BRC Asia has reported earnings of $39.8 million for the 1HFY2022 ended March, 108% higher than net profit of $19.2 million in the same period the year before.
Earnings per share (EPS) for the period stood at 14.65 cents, higher than the 8.08 cents in the 1HFY2021.
Revenue for the half-year period increased by 61% y-o-y to $793.3 million in line with the higher deliveries and higher steel prices.
Volume growth was driven by the low base due to the shutdown of the construction sector during the circuit breaker period in 2020.
Steel prices have increased by at least 40% during the comparative growth, which contributed to the significant revenue growth.
During the same period, the group’s gross profit increased by 73% y-o-y to $68.8 million, with net profit margin of 5.0%, 1.1 percentage points higher y-o-y.
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A net reversal of $1.8 million was made in the 1HFY2022 out of the recorded provision for onerous contracts of $46.1 million at the beginning of the financial period. The reversal of provision for onerous contracts were attributed to reversal of provisions made as at Sept 30, 2021 for deliveries in 1H FY2022, partly offset by additional provisions for deliveries beyond March 31.
For the 1HFY2022, BRC declared a dividend of six cents for the period, up two cents from the four cents per share in the 1HFY2021.
As at end-March, cash and cash equivalents stood at $140.0 million.
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"This is a good set of half-year results, and we would like to thank shareholders for their continuing support by locking in an interim dividend of six cents for 1HFY2022,” says Seah Kiin Peng, CEO of the group.
“The local construction sector has continued to recover well amidst Singapore's resolute re-opening, and while we can expect stability on this front, external factors are weighing downs the pace of the sector's recovery somewhat. Covid-19 spikes in China and its strict Covid strategy have caused global supply chain disruptions through lockdowns and port traffic delays,” he continues.
“The ongoing Russia-Ukraine conflict is also adding a layer of uncertainty in the markets, particularly on commodities and energy. Nevertheless, we should expect these macro issues to sort themselves out in the next 12 months. For BRC, our focus is on the fine-tuning of our processes and products through further mechanisation and digitisation to better serve our customers with our just-in-time total reinforcing steel solutions."
As at March 31, the group’s order book stood at $1.0 billion, to be delivered progressively in the next five years.
Shares in BRC Asia closed 2 cents higher or 1.23% up at $1.65 on May 11.
