Boustead Projects, a leading provider of smart eco-sustainable real estate solutions has reported a loss of $2.2 million for the 1HFY2021 ended Sept 30 compared to the earnings of $9.6 million a year ago.
The loss was mainly due to the design-and-build segment, and was partially offset by the higher profit from the real estate segment.
The loss translates to loss per share of 0.7 cents for the 1HFY2021 compared to the 3.1 cents the year before.
Revenue for the six-month period fell 44% y-o-y to $87.7 million due to delayed design-and-build revenue recognition due to the circuit breaker measures and phased resumption of construction activities.
The design-and-build segment was further affected by lower margins on current projects and lower quantum of cost savings from previously completed projects.
Gross profit plunged 71% y-o-y to $6.3 million due to a result of overall gross margin compression to 7% for the 1HFY2021 compared to 14% the year before.
The lower overall gross margin compression is mainly due to lower margins on current projects and delayed recognition of design-and-build revenue.
Share of loss of associated companies and joint ventures for the half-year period fell 64% y-o-y to $0.6 million mainly due to an improvement in the ongoing asset stabilization of ALICE@Mediapolis, and partly offset by the commencement of asset stabilization of 6 Tampines Industrial Avenue 5.
Total loss stood at $2.3 million from the $9.6 million in 1HFY2020.
As at Sept 30, cash and cash equivalents stood at $116.0 million.
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Thomas Chu, managing director of Boustead Projects, says the losses were “limited” to the $2.3 million due to the implementation of “numerous mitigation measures to address the pandemic and with the assistance of government support and relief measures, along with our more stable real estate business”.
“Despite the challenging conditions, our real estate team worked relentlessly to secure new key tenants for our leasehold properties –both already completed and those still under construction –leasing up a respectable 39,600 square metres of net lettable area in recent months,” he says.
“Barring unforeseen circumstances and any further major disruptions caused by the pandemic, we expect the progressive ramp-up of our Singapore projects and the strong progress of our real estate business to help drive us into a profitable position for FY2021. We are also still continuing to advance efforts on multiple fronts to unlock the value of our leasehold portfolio,” he adds.
Boustead says its current order backlog plus the total value of new orders secured since the end of 1HFY2021 stands at a “healthy level” of some $447 million. The bulk of them are expected to be recognised over FY2021 and FY2022.
Shares in Boustead Projects closed 2 cents lower or 2.7% down at 72 cents on Nov 12.
