Aug 26, 2010

Sim Lian's full-year net profit surges 170%

By Esther Teo

SIM Lian Group has reported a 170 per cent surge in full-year net profit to $104.4 million, buoyed mainly by a strong residential property market that boosted its property development division.

Revenue for the year ended June 30 jumped 32 per cent to $760 million, mainly owing to revenue recognition from residential projects such as Parc Lumiere and Rochelle at Newton, it said in a statement yesterday.

The property division alone contributed $582.1 million to revenue - 47 per cent more than last year's $394.9 million. The construction division contributed revenue of $153.7 million - down 3.3 per cent year-on-year.

Sim Lian said the group will remain selective in all tenders to ensure that construction jobs are secured with 'reasonable prices and margins'.

It added that its development projects are expected to contribute positively to its performance in the current financial year.

Full-year earnings per share increased to 18.4 cents from 6.8 cents year-on-year, while net asset value a share was 55.04 cents, up from 38.07 cents. The group recommended a dividend of 3.7 cents a share.

Sim Lian shares remained unchanged at 52 cents yesterday.

The group also proposed a bonus issue yesterday on the basis of one bonus share for every two existing ordinary shares held by shareholders.

Sim Lian said that up to 284 million new bonus shares will be issued at no cost to shareholders and be ranked equally with the 568 million existing shares. But the bonus shares will not be entitled to the final cash dividend of the past financial year.

Sim Lian said the proposed issue will increase its issued share capital base, reflecting expansion, and recognise shareholders' continued support.

'If completed, (it) will also increase the accessibility of an investment in the company to more investors, thereby encouraging trading liquidity of the shares in the market,' Sim Lian said.