Lian Beng reported FY10 net profit grew by 41.3% yoy to $24.04m while revenue was up 12% to $345.71m. The better earnings were driven by a broad-based performance across its construction, property development and ready-mixed concrete divisions. Notably, GPM was higher at 13% compared to 12% previously. Due to the repayment of some of its loans, net gearing also decreased sharply to 0.17, compared to 0.67 in FY09. As at end-May 2010, cash and cash equivalents increased nearly 3x to to $70.8m.
In view of its strong cashflow, Lian Beng is declaring a first & final cash dividend of 0.4 cent per share, and a special dividend of 0.4 cent per share. This represents a dividend payout ratio of 17% or yield of 2.7%. YTD, Lian Beng was awarded 5 building contracts worth about $530m for the construction of private residential developments.
The addition of these contracts, coupled with the $88m condominium contract at Spottiswoode Park Road secured at the beginning of FY11 brings its total order book to $846m. The stock currently trades at 6.5x FY10 PER.
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