SINGAPORE (Aug 24): Steel stockist HupSteel has announced its FY17 earnings of $720,000 as compared to a loss of $19.1 million in FY16.
Full year revenue and rental income came in at $49.6 million, 12% lower compared to $56.4 million a year ago.
HupSteel says the weaker topline reflected the continued state of soft demand and weak market as oil prices crumbled over last year, dragging many shipyards and offshore marine businesses into severe financial difficulties.
However, HupSteel says it steered away from businesses in distress and competed intensely for orders which enabled it to report a gross profit of $13.4 million for the full year compared to a gross profit of $2.8 million a year ago.
Meanwhile, lower sales volume transacted throughout the financial year led to lower expenses of $4.9 million compared to $11.4 million a year ago.
In addition, staff costs decreased to $6.6 million from $7.8 million as the group implemented cost-cutting measures in addition to minimising provision for incentives.
In its outlook, HupSteel says it does not expect demand to improve in the near term despite the local economy showing signs of growth, while turnover for the next few quarters is likely to remain stable and flat.
The group also expects competition to remain intense as overall demand is still soft and uncertain.
Hence, the group is looking to reorganise itself to better respond by managing its costs, stocking the right items for sale and looking for collaboration opportunities.
HupSteel has declared a full year dividend of 1 cent.
Shares in HupSteel last traded 2 cents higher at 81 cents on Thursday.
