SINGAPORE (May 5): Hupsteel has reversed out of the red in the third quarter ended March with earnings of $243,000, from a net loss of $372,000 a year ago.
Revenue in 3Q dipped 4% to $11.5 million, compared to $12.0 million a year ago.
This was mainly due to the lower sale of steel products to the marine and oil & gas sectors due to the sustained global slump in demand.
Despite the decline in revenue, gross profit climbed 11% y-o-y to $3.2 million, from $2.9 million a year ago, on the back of a 3.8-percentage-point improvement in gross profit margin to 28.1%.
Staff costs fell 20% to $1.4 million, from $1.7 million a year ago, due to lower provision for staff incentives and the implementation of manpower cost cutting measures in addition to lower headcount.
Cash and cash equivalents stood at $55.3 million as at March 31, 2017.
Looking ahead, Hupsteel says the mid-term outlook for structural steel products, pipes and fittings remains uncertain.
It adds that its margins will be affected by any sudden strengthening of the US dollar.
In a filing to SGX, Hupsteel says it is “looking to navigate out of the current depressing conditions on the back of its strong balance sheet.”
Shares of Hupsteel closed 1 cent higher at 68 cents.
