SINGAPORE (April 12): Lian Beng, the construction and property group, posted a 83.5% fall in 3Q17 earnings to $2.9 million from a year ago.
This came on the back of a 64.3% fall in revenue to $36.2 million, dragged down by lower sales from the construction segment and ready-mixed concrete segment.
For the 9M17 ended Feb, earnings fell 70.7% to $21.2 million. Revenue fell 57.4% to $156.2 million.
Gross profit decreased marginally to $39.4 million in 9M17 from $42.9 million in 9M16 mainly due to the higher profit recognition from the construction division.
9M17 share of results of associates and joint ventures also declined $49.1 million to $14.2 million mainly due to the completion of some property development projects such as NEWest and the Midtown and Midtown Residences in the last financial year.
Other operating expenses increased $8.2 million to $11.3 million in 9M17 mainly due to increase in unrealised exchange loss which arose from the revaluation of loans denominated in foreign currency to finance investments in the United Kingdom and impairment loss on investment securities arising from the valuation of the shares of Centurion Corporation.
To date, the group’s construction order book stands at $597 million, offering steady flow of activity through FY2020.
Looking ahead, Lian Beng says its investment projects have made good progress.
For its joint hotel development in Leeds, UK, global hotel operator Hilton has signed a franchise agreement to manage the 192-bedroom facility. Operations are expected to start in late 2019.
Meanwhile, the Chinese government will establish a new special economic zone (SEZ) in the province of Hebei’s Xiongxian, Anxin and Rongcheng cities, next to its joint development project in Gaobeidian.
“As Gaobeidian sits near this NSEZ, we believe the NSEZ will offer a positive and favourable impact on our development project there,” says Lian Beng’s Executive Chairman Ong Pang Aik.
Shares of Lian Beng closed 4 cents higher at 64 cents.
