Hiap Seng Engineering

Hiap Seng Engineering: Group's 4QFY13 net loss of $4.5m doubled y/y from $2.2m, mainly due to cost increases in labour and materials, as well as a reversal from a previous gain on equity of $2.8m which the group previously recognized in 1QFY13 from the step acquisition of its Thai subsidiary. The group reported FY13 earnings of $7.5m (+76.1%), as a result of higher recognition of project revenue and contributions by two new subsidiaries in Thailand and Malaysia. Management's indication of the outlook in the oil & gas and petrochemical industries remains positive, but increasing costs from keen competition and rising labour remains in focus. Hiap Seng has an outstanding order book of $256m. A final dividend of 0.5¢ per share was declared, bringing its total FY13 dividends to 1.0¢. At last closing price of $0.3350, Hiap Seng trades at 13.5x trailing P/E, 1.3x P/B and historical dividend yield of 3%.