Boustead Singapore profits up 9% in H2

Its revenue was driven by successful conversion of order backlogs.

Boustead Singapore Limited total profit rose 9% YoY to $26.2m in H2 FY2020 from $24m in 2019, according to a filing. Its revenue jumped 61% to $434.5m over the same period.

Boustead’s chairman and CEO Wong Fong Fui said that the record revenue was driven by successful conversion of order backlogs at both energy-related engineering and real estate solutions, as well as the continued growth of geospatial technology, and healthcare technology.

The company notes that its revenue growth outpaced profit growth, mainly as a result of gross margin pressure, other losses largely due to fair value losses on investment securities, higher administrative, finance and income tax expenses, and impairment losses related to the end of legacy projects.

Its energy-related engineering division secured record orders and contributed to almost three quarters of the $396m in new contracts secured by the group in FY2020. It also benefited from converting its healthy order backlog to grow revenue by 41% YoY to $144.5m with most of the improvement coming from the downstream oil and gas business.

Meanwhile, the real estate solutions division raised revenue by 82% YoY to a new division record of $426.2m. The geospatial technology division rode on steadfast demand for geospatial technology across Australia and South East Asia to expand revenue by 12% YoY to a new division record of $137.3m.

In addition, its healthcare technology division’s revenue improved by 60% YoY to $18.2m, with growth registered across various business lines in rehabilitative care, sleep care, and sports science.

Boustead adds that it delivered steady profitability from its core businesses and maintained a strong cash position with the board proposing a final cash dividend of 2 cents per share, taking the total dividend proposed for FY2020 to 3 cents per share.

Furthermore, the group’s net asset value per share rose to 70.3 cents at the end of FY2020 from 68.2 cents at the end of FY2019, factoring in the allotment of new shares pursuant to the scrip dividend scheme and the purchase of treasury shares.

The groups’ net cash position was also boosted to $162.7m, translating to a net cash per share position of 33.4 cents. In addition, the group held $49.5m in investment securities, of which about 37% of the amount is highly liquid.