SINGAPORE (Feb 22): United Engineers posts a 36% drop in earnings to $89.6 million for the full year ended December, from $140.6 million a year ago.
This was due to the absence of contributions from discontinued operations, which accounted for earnings of $113.2 million a year ago.
Excluding discontinued operations, UE’s earnings would have more than trebled from $27.4 million a year ago.
FY17 revenue increased 12% to $539.4 million, from $479.7 million a year ago.
This was mainly due to higher revenue from property development, which was partially offset by lower revenue from other business divisions.
Gross profit grew 2% to $197.8 million in FY17.
Interest income increased 20% to $3.1 million in FY17, mainly due to higher interest income from fixed deposits.
Other income increased 171% to $70.2 million in FY17, from $25.9 million a year ago, on the back of revaluation gains of $44.4 million from the group’s investment properties and a $16.8 million reduction in the provision for rental support for UE Bizhub East.
Finance costs decreased 41% to $21.2 million in FY 17, from $35.7 million a year ago, mainly due to lower borrowings.
Other expenses fell 43% to $16.7 million in FY17, from $29.5 million a year ago, mainly due to the absence of revaluation deficit on certain investment properties and lower impairment loss in relation to certain overseas development projects.
Share of profit from equity-accounted associates and joint ventures dropped by 34% to $1.9 million in FY17, mainly due to lower contribution from a joint venture in Singapore arising from revaluation deficit from its investment property.
Income tax expense increased 122% to $19.5 million in FY17, from $8.8 million a year ago, mainly due to higher profit in FY17 and under-provision of prior years’ income tax.
As at end December, cash and cash equivalents stood at $384.7 million.
Looking ahead, UE says the strengthening global economic will continue to bode well for Singapore’s property market.
It adds that it intends to embark on asset enhancement initiatives for its investment properties in Singapore and may make selective acquisitions if such opportunities arise.
In China, UE says the property market may continue to see sustainable growth in the longer term despite property cooling measures which have brought about a relative slowdown in activity.
Shares of United Engineers closed flat at $2.56 on Thursday.
