SINGAPORE (Nov 7): Thakral Corporation saw its earnings surge more than seven-fold to $1.7 million for the 3Q19 ended September, from $222,000 a year ago.
Earnings per share (EPS) jumped to 1.31 cents for 3Q19, compared to EPS of 0.17 cent in 3Q18.
3Q19 revenue fell 28% to $27.7 million, on the back of China’s ongoing trade row with the US, the fallout in China of a key Japanese brand, and continuing unrest in Hong Kong.
This was partially mitigated by higher revenue from its Investment Division, which rose 24% to $9.6 million during the quarter.
Despite the drop in revenue, the group posted 8% higher gross profit of $12.0 million in 3Q19, as cost of sales was slashed by 42% to $15.7 million.
The improvement in its 3Q19 bottom-line was boosted by a 46% drop in administrative expenses to $2.4 million, largely attributable to lower staff costs as a result of an adjustment in bonus accruals.
The group also saw a $0.5 million gain in 3Q19 from share of profit of associate and joint ventures, mainly due to the group’s Japanese property investments under TPG as well as the GemLife joint venture for the development and management of retirement resorts in Australia.
The earnings surge in 3Q19 brings Thakral’s 9M19 earnings to $4.5 million, some 6% higher than a year ago.
The group registered 19% lower 9M19 gross profit of $29.3 million, as revenue dropped 36% to $78.1 million during the period.
The improved earnings in 9M19 were driven by a $3.4 million gain on disposal of its office building in Osaka, Japan.
In addition, the group in 9M19 also saw lower administrative expenses, lower valuation losses on investment properties, as well as higher share of profit of associate and joint ventures.
As at end-September, cash and cash equivalents stood at $16.2 million.
The board has declared a second interim dividend of 2 cents per share, payable on Nov 29.
“Our strong portfolio of investments especially in Japan and Australia, which helped mitigate the impact of severe headwinds over the past months, will remain our key growth driver in the coming months,” says Natarajan Subramaniam, independent non-executive chairman and lead independent director of Thakral.
“Our focus will be on growing sustainable income from our real estate investments,” he adds.
Shares in Thakral closed flat at 47 cents on Thursday.
