SINGAPORE (Nov 5): OKP Holdings announced 3Q18 earnings increased 9.3% to $0.81 million, compared to $0.74 million in 3Q17.
However, earnings for 9M18 was 65% lower at $3.76 million, compared to $10.7 million in 9M17, mainly due to a decrease in revenue for the period.
During the quarter, the group’s revenue dropped by 20.0% to $21.7 million from $27.1 million a year ago, mainly due to a decrease in revenue from the group’s construction and maintenance segments, but was partially offset by higher rental income.
The decrease construction revenue was largely attributable to lower revenue recognised from a few construction projects which were reaching completion and a newly-awarded construction project in 3Q18.
The decrease in maintenance revenue was mainly due to lower revenue from a few maintenance projects which were reaching completion and a few newly-awarded maintenance projects during 3Q18.
With cost of sales dropping 25.3% y-o-y to $18.3 million, gross profit came up 28.3% higher at $3.42 million from $2.66 million last year.
Finance expenses saw a significant increase to $296,000 from $20,000 in the previous year.
As at Sept 30, the group’s cash and cash equivalents stood at $73.5 million.
Or Toh Wat, group managing director of OKP, says, “The construction sector will continue to experience headwinds given the challenging operating environment due to keen competition, rising business and operation costs as well as manpower shortage.”
“The group remains cautiously optimistic on near-term prospects as we stay focused on our core business, supported by a pipeline of projects. At the same time, we will continue to seek suitable opportunities to diversify our earnings beyond construction, both within Singapore and overseas,” he adds.
Shares in OKP last traded at 19 cents on Monday.
