http://www.businesstimes.com.sg/arch...oject-20140509

Published May 09, 2014

Chip Eng Seng Q1 profit soars on property project

By raphael lim

[email protected]


CONSTRUCTION and property group Chip Eng Seng's first-quarter net profit more than quadrupled year-on-year, mainly from higher revenue in its property development division.

Net profit for the period ended March 31, 2014, was $21.6 million or 3.35 cents per share, up from $4.67 million or 0.72 cent per share a year ago.

The group's net profit margin was 10.9 per cent for the quarter, higher than the 3.6 per cent in Q1, 2013.

First-quarter revenue rose 51.7 per cent year-on-year to $197.8 million, due mainly to higher revenue from the property development segment.

The property development division posted the largest rise, with a near doubling of revenue to $125.1 million, from $64.2 million in the year-ago period.

Chip Eng Seng said the increase was due to revenue recognised from a completed commercial project known as 100 Pasir Panjang.

Its construction division also recorded a 9.6 per cent increase in revenue to $71.7 million.

Helping the bottomline as well was significantly lower marketing and distribution expenses.

The group spent $0.8 million on marketing and distribution in the quarter, compared to $8.5 million in the year-ago period.

The higher expenses last year was attributed to sales commission incurred for two newly launched development projects, Alexandra Central and Tower Melbourne, said the group.

Net asset value per share for the group was 81.39 cents as at end-March, up from 77.12 cents at end-December.

Chip Eng Seng said in a statement: "Moving forward, the group will continue to participate in land tenders for property developments in Singapore and will continue to look for opportunities to replenish its land bank in Singapore and the surrounding region."

No dividend was declared.

The counter closed half a cent higher at 72.5 cents yesterday, before the results were announced.