SINGAPORE (May 10): Keong Hong Holdings, the construction group and property and hotel investor and developer, reported 2Q earnings of $2.195 million, down 55.5% from a year ago.
This was due to higher cost of sales and lower net gains from JVs and associates.
2Q revenue rose 41.5% to $43.5 million, mainly due to higher revenue contribution from the construction of Seaside Residences condominium at Siglap and Pullman Maamutaa resort in Maldives.
The increase in revenue was also aided by the construction of National Skin Centre and The Antares condominium at Mattar Road, which started in 1H2019.
However, cost of sales rose a steeper 51.8% to $37.8 million which brought 2Q gross profit to $5.7 million.
Gross profit margin came in at 13.2%.
For 2Q19, net gain from JVs and associates halved to $1.2 million from $2.4 million in 2Q18.
For 1H19, earnings came in at $6.15 million, 8.1% lower compared to a year ago. Revenue came in 7.2% higher at $76.7 million.
As at March 31, Keong Hong’s construction order book stood at $293 million.
In its outlook statement, the group expects headwinds for 2019 in the form of volatile oil prices, rising interest rates and higher material costs, despite a growth of 1.4% in the construction sector in the 1Q19 and an improvement in private sector construction activities.
Locally, Seaside Residences has attained sales of more than 89% to date while the 265-unit Antares condominium at Mattar Road will be launched in July.
With the impending completion of Pullman Maldives Maamutaa Resort, Keong Hong says it is actively seeking hotel development and investment projects, both in Singapore and in overseas markets which it has identified.
The group is recommending an interim dividend of 0.5 cent, compared to 0.25 cent a year ago.
NAV per share of Keong Hong stood at 93.6 cents as at end of March.
Shares in Keong Hong closed 0.5 cent higher at 49 cents on Friday.
