SINGAPORE (July 7): Boustead Singapore, the engineering services and geo-spatial technology group saw its earnings rise 11% to $18.5 million for 2H20 ended March, from the $16.6 million posted in 2H19.
The group, however, saw earnings for FY20 fall 5% to $30.9 million compared to the $32.5 million reported in FY19.
The fall in earnings was due to the absence of a $5.9 million pre-tax gain on the sale of 25 Changi North Rise registered in the previous year. The drop was also attributable to gross margin pressure, fair value losses on investment securities, as well as higher administrative, finance and income tax expenses, and impairment losses related to the end of legacy projects.
Excluding the impairment losses and gain on the sale of 25 Changi North Rise, the group says net profit for 2H20 and FY20 would have been 48% and 34% higher y-o-y respectively.
This brings the group’s earnings per share for 2H20 to 3.8 cents, up 12% y-o-y.
Correspondingly, earnings per share for FY20 fell 5% y-o-y to 6.3 cents.
Revenue for 2H20 surged 61% y-o-y to $434.5 million, and rose 54% y-o-y to $726.6 million for FY20. Revenue growth outpaced profit growth, mainly attributable to a result of gross margin pressure.
The group’s Real Estate Solutions Division (Boustead Projects) was the largest revenue contributor, with a 93% y-o-y increase to $269.5 million for 2H20, from its order backlog of design-and-build projects.
Its Energy-Related Engineering Division posted a 32% rise in revenue to $78.7 million, while revenue from its Healthcare Technology division climbed 25% to $9.5 million.
Revenue for its Geo-Spatial Technology Division increased 24% to $76.5 million.
Boustead’s net asset value (NAV) per share rose to 70.3 cents for FY20, from 68.2 cents in FY19. The increase factored in the allotment of new shares following the Scrip Dividend Scheme and the purchase of treasury shares.
In FY20, the group was awarded some $396 million in new contracts. The group further secured $128 million in new contracts in FY21, bringing its current order book backlog of $775 million.
As at end March, cash and cash equivalents stood at $281.7 million.
Boustead has proposed a final dividend of 2 cents per share for the period. This brings the total dividend for FY20 to 3 cents per share.
“We achieved a commendable set of results for FY2020 under what has been overall a very tough business environment,” says Wong Fong Fui, chairman and group CEO of Boustead.
“The global COVID-19 pandemic, demand deficit and the various other prevailing geo-economic and geo-political headwinds present extreme uncertainties to short-term business development prospects. Nonetheless, we will continue to fortify our stable financial position to weather the highly challenging global landscape,” he adds.
“We are aiming to deliver steady results for FY2021. However, our ability to do so will largely depend on how well we are able to operate under the uncertainties and difficult conditions caused by the pandemic. This is well illustrated by the lockdowns that have occurred in all of our geographic areas of operation, which we expect will affect our financial performance in the first half of FY2021, as well as by Boustead Projects’ delayed design-and-build projects,” concludes Wong.
Shares in Boustead Singapore closed 0.5 cent down, or 0.8% down, at 64.5 cents on Tuesday, prior to the announcement.
