SINGAPORE (Feb 13): Chip Eng Seng announced that its 4Q17 earnings has dropped by 2.4% to $14.5 million, compared to $14.9 million in 4Q16.
Revenue increased by 2.4% to $256.1 million from $250.0 million a year ago, mainly due to the increase in revenue from the group’s property development and hospitality sectors, but was partially offset by a decrease in revenue from its construction as well as property investment & other segments.
The group’s property development segment saw a 31.4% increase in revenue to $194.0 million, due to the progressive recognition of High Park Residences and Grandeur Park Residences. A pick-up in sales at Fulcrum along Fort Road and the progressive handover of townhouses of Williamsons Estate in Doncaster, Melbourne, also helped contribute to the stronger topline.
Revenue from the hospitality division almost doubled to $13.7 million, due to contribution from the Group’s newest hospitality offering in Maldives, Grand Park Kodhipparu Resort. Overall topline was also boosted by improved occupancy at the Group’s Singapore-based hotel, Park Hotel Alexandra.
Construction revenue was 49.6% lower at $46.6 million, as new projects secured were not sufficient to replenish the construction order book, as well as lower contributions from Tampines N6C1A/1B and the absence of takings from Bukit Batok N1C13 & N2C23 and Sembawang N1C10. This was however partially mitigated by healthy contributions from the group’s two Bidadari projects.
The group’s property investment & others division was 36.8% lower at $1.8 million, mainly attributed to the divestment of the Group’s office building at 420 St Kilda Road in Melbourne, Australia.
Cost of sales declined by 0.1% to $204.0 million from $204.3 million last year, bringing gross profit to $52.1 million, 14% higher than $45.7 million a year ago.
Other income declined by 89.3% to $0.91 million from $8.50 million last year.
During the quarter, the group recorded a gain in share of results of associates of $390,000 compared to a loss of $7,000 in the previous year.
The group declared a first & final cash dividend of 4.0 cents per share, which will be payable on or about May 23.
Looking forward, the group will continue to look for opportunities to further replenish its land bank in Singapore.
In Australia, the group will continue to participate in new public housing tenders, as well as non-housing public projects.
Shares in Chip Eng Seng closed 2 cents higher at 95 cents on Tuesday.
