Nordic Group has reported earnings of $6.1 million in its 2HFY2021 ended Dec 31 2021, a 63.1% jump from the $3.6 million posted in the year before.
This follows a 12.8% rise in revenue to $58.9 million in 2HFY2021, amid a higher take up for its PS and MS segments.
For FY2021 ended Dec 31 2021, the company – which provides a range of system integration solutions and repair and maintenance works – posted earnings of $13.9 million, a 153.1% surge from the $5.5 million in FY2020.
On a fully diluted basis, this translates to earnings per share of 3.6 cents, up 157.1% from 1.4 cents in FY2020.
With this, net asset value per share stood at 25.2 cents in Dec 31 2021, compared to 22.8 cents at the end of the previous year.
To mark its jump in earnings, Nordic Group has declared a dividend payout of 0.76 cents per share. Of this, 0.608 cents is an interim dividend while 0.152 cents is a special dividend.
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This brings the total dividend payout for FY2021 to 1.74 cents per ordinary share, which is 3.2x over FY2020’s dividend payout of 0.549 cents per share.
Based on Feb 18’s closing price of 39.5 cents, the dividend yield is 4.41% while the dividend payout is at 50% of the net profit for FY2021.
The group’s dividend policy is to pay out 40% of its net profit as dividends; however, it is paying an additional 10% in special dividends for FY2021 due to its strong financial performance.
Revenue for the year rose by 27.6% to $103.1 million, thanks to the resumption of business activities to pre-pandemic levels.
Key contributions came from a 22.9% increase in the group’s project services (PS) segment to $48.4 million and a 31.9% rise in the maintenance services (MS) segment to $54.7 million.
Cost of sales correspondingly edged up to $103.1 million, from $80.8 million.
Gross profit came in 54.8% higher at $27.8 million in FY2021. As such, gross profit margin increased to 27.0% from 22.8% in FY2020 on the back of higher revenue from the recovery of business activities affected by Covid-19.
Excluding the government rebates and grants such as the wage credit scheme, jobs support scheme, foreign workers levy rebate and foreign worker levy waiver, the gross profit margins were 24.5% for FY2021 and 15.8% for FY2020.
Other income and gains decreased to $1.6 million in FY2021 from $3.8 million in the year before, mainly due to the absence of a write-back for payables and lower government grants.
In this time, administrative expenses softened by $0.4 million to $13.3 million thanks to cost savings from the restructuring of some business units as well as lower depreciation expenses.
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Similarly, interest expenses edged down by $0.4 million to $0.6 million due to lower interest rates during FY2021.
As at Dec 31 2021, cash and cash equivalents stood at $75.3 million up from $57.5 million in the year before.
Nordic Group clinched around $141.7 million worth of contracts in FY2021, bringing its outstanding order book to $166 million on Dec 31 2021. This is expected to generate sustained revenue streams up to FY2024.
The PS segment accounts for approximately $60.4 million of the combined order book, while the MS segment contributed some $105.6 million.
Going forward, the group is optimistic of continuing to deliver value to its shareholders with the contract wins it has secured and its prudent cost and risk management initiative. Opportunities also come from its acquisition of Starburst Holdings and other M&As it is looking into.
As at 10.10am on Feb 22, shares in Nordic Group were up a cent or 2.56% at 40 cents.
Cover image: Nordic Group
