Lian Beng: Announced 1H12 results, which was broadly in line, although bottom-line surprised a bit on the upside. 1H12 Rev at $237.7m, -4.7% YOY, while Net Profit at $30.1m, +33.4% YOY. Gross Margins was pretty stabe at 15.2% vs 15.6% yoy.
Overall, the slight decline in rev at 1H12 was mainly due to lower rev recorded from construction projects in 2Q12, while strong bottom-line, was boosted due to recognition of income from sale of investment ppty at New Industrial Road in 1Q12.
Going forward, grp remains confident and will continue to focus on its core construction business and remain active in tendering for new projects in the public and private sectors.
We note that grp’s orderbook stands at $772m, underpinning earnings visibility till FY15, while at current price, valuations are compelling, with grp trading at an annualized 3.1x FY12E P/E vs historical average of 5.6x,Balance sheet remains healthy with a low net gearing of 5%.
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