SINGAPORE (March 7): XMH Holdings posted a 23.2% decline in earnings to $0.77 million for the 3Q ended Jan 31, 2017, compared to earnings of $1.0 million a year ago.
Revenue fell 27.5% to $19.5 million in 3Q17, from $26.9 million a year ago.
This was mainly due to a decrease in revenue recorded in its project business segment, which was affected by weak market sentiment and saw smaller contract value awarded.
Gross profit fell 32.9% to $4.7 million in 3Q on the back of a 2-percentage-point decline in gross profit margin to 24.1%.
In a filing to SGX on Tuesday, XMH says the lower margin was due to “intense competition across all business segments”.
Other income increased to $1.5 million in 3Q, from $0.4 million a year ago.
This was mainly due to a $1.1 million gain on disposal of fixed assets and rental income of around $0.35 million from the sub-letting of its new factory building in Tuas, and partially offset by lower government grants and other income received compared to the same period last year.
Cash and cash equivalents stood at $18.9 million as at Jan 31, 2017.
“In light of the weak market sentiments, we remain prudent and seek to enhance resilience by building on our synergies and adhering to strict cost control measures,” says Elvin Tan Tin Yeow, XMH’s chairman and managing director.
Looking ahead, the group says reduced capital expenditure and consolidation remain the ongoing theme with the offshore marine markets expecting a prolonged downturn..
“Our focus is to reduce business risks and fortify our position pending improvement in the markets that the group operates in,” Tan adds.
Shares of XMH closed flat at 29 cents on Tuesday.
