SINGAPORE (Feb 22): Soilbuild Construction Group reported $3.5 million in earnings for 4Q16, down 37.6% from its net profit of $5.6 million in 4Q15.
Revenue for the quarter fell 8.8% to $89.4 million from $98 million a year ago, with major revenue contributors being its projects for Jalan Lam Huat, Yishun HDB, Sembawang HDB, Ang Mo Kio HDB, Goodwood Grand, and the development of a hospice at Thomson Road.
Gross profit declined 33.6% to $5.3 million from $8 million in 4Q15, such that gross profit margin in 4Q fell to 6% from 8.2% in the previous year.
This was mainly due to higher revenue recognised during the quarter for HDB projects in Singapore where gross profit margins were relatively lower, in line with the progress of the ongoing projects – as well as an increase in construction cost for certain projects.
Soilbuild’s construction projects in Myanmar contributed gross profit of $1.8 million during the quarter, which represents a higher profit margin than those in the local market.
Consequently, the group posted a 36% decline in FY16 earnings to $11.9 million from $18.6 million in FY15, although revenue for the year grew 21.7% to $399.6 million from $328.3 million in FY15.
The higher FY16 revenue was contributed by the progressive revenue contributions from its on-going local building projects, in addition to progressive revenue contribution from its construction contracts in Myanmar and the local civil works contracts.
In a Wednesday filing to the SGX, executive director Ho Toon Bah notes a challenging local market, but says the group will continue to focus on productivity to enhance its competitiveness as well as put effort in cost management.
Soilbuild has recommended a final dividend of 0.5 cent, and a special dividend of 0.75 cent to reward shareholders – bringing the full year cash dividend for FY16 to 1.75 cent.
Shares of Soilbuild closed flat at 22 cents on Wednesday.
