SINGAPORE (May 23): Hiap Seng Engineering announced a loss of $1.8 million for 4Q ended March, which brought the group’s FY17 earnings down 26.9% to $3.8 million.
Revenue for the quarter fell 37% to $35 million, mainly due to lower recognition of project revenue.
As such, FY17 revenue fell 5.6% to $158.5 million with revenue from the compression & process equipment fabrication segment falling to $8.18 million from $24.3 million a year ago.
This was partially offset by slightly higher revenue from the plant construction & maintenance segment, which increased to $150.3 million from $143.6 million in the previous financial year.
Due to lower revenue and higher operating costs, gross profit fell to $2.8 million in 4Q17 from $6.4 million in 4Q16, whereas FY17 gross profit decreased to $19.2 million in FY17 from $23.5 million in FY16 for the same reasons.
Administrative costs grew to $4.8 million from $4 million as a result of an amortisation of intangible assets of $1.7 million over the recent quarter.
Amortisation of intangible assets recorded was $1.9 million for the full year, such that the group’s administrative costs increased to $18.3 million for FY17 from $17.8 million a year ago.
As at May 23, the group’s outstanding order book stands at $108 million.
The directors of Hiap Seng Engineering remain cautiously optimistic about the group’s performance for the current financial year ending March 31, 2018, in spite of the intense competitive market conditions of the oil & gas industry.
The group will continue to further control costs and take steps to improve productivity and look for other business opportunities, it adds.
Shares of Hiap Seng Engineering closed 1.35% lower at 15 cents on Tuesday.
