Gross profit margin rose by 4.0 percentage points y-o-y to 48.3%, compared against FY2025’s figure of 44.3%. On the other hand, revenue increased by 5% y-o-y to $46.5 million, slightly behind the analysts’ FY2026 forecasts at 96%.
From the analysts’ perspective, Reclaims Global remains in a strong financial position, with net assets rising to $47.2 million at the end of FY2026 and a net cash position of $27.9 million, with no borrowings.
“It declared a final and special dividend of 1 cent per share, bringing total FY2026 dividends to 2.5 cents per share and a payout ratio of 54%, compared to just 28% back in FY2025. Supported by its strong balance sheet, we expect dividend payouts to remain robust going forward,” the team predicts.
The UOB KayHian team also points out that while the surge in diesel prices is expected to raise costs for the company, particularly in its logistics and leasing segments, the management indicated around 40%-60% of the increase will be passed on to customers, helping to mitigate the overall impact.
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Meanwhile, Singapore’s ongoing construction upcycle, which the medium term demand is projected to be around $39-$46 billion annually from 2027 to 2030, should translate into sustained demand for Reclaims Global’s business segment, according to both Tang and Mo.
Some of the key projects ahead include the ongoing and upcoming phases of the Changi Airport Terminal 5 (T5) development, the anticipated award of the main contract for the Marina Bay Sands Integrated Resort expansion, and several other large-scale projects.
“In 4QFY2025, Reclaims Global secured several contracts, including a $15.5 million contract for the provision of labour and machinery for earthworks and disposal works, as well as a mix of public and private sector contracts valued at $3.1 million, covering demolition, reinstatement, and related construction activities. These contracts, with durations ranging from 1-12 months, are expected to contribute positively to its FY2027 earnings,” adds the team.
At the same time, both Tang and Mo predict that the recent venture in property-related investments by the company could see potential capital appreciation and rental income, while strengthening the group’s asset base and providing optionality for future growth.
As such, the UOB KayHian team is maintaining a “buy” call with a slightly lower target price of 27 cents, from the previous 28 cents, after lowering their earnings forecast. At 27 cents, it implies a 22.7% upside and the target price is pegged to 12 times FY2027 P/E ratio, which is in line with the company’s mean historical P/E ratio.
“We believe Reclaims Global’s current valuation of 9.7 times FY2027 P/E ratio is undervalued, given its high ROE of around 17%, driven by strong construction industry tailwinds and strong balance sheet with net cash of $27.9 million, which is around 28% of its market capitalisation,” the team concludes.
As at 11.26am, shares in Reclaims Global are trading flat at 22 cents.
