ISOTeam

ISOTeam: 1HFY14 net profit grew 61.4% y/y to $2.1m, on the back of a 44.4% spike in revenue to $31.9m, boosted by contributions on the completion of five repair and redecoration projects which propped the segment up 86% to $21.4m. Gross margins were slightly trimmed to 16.8% (-0.9ppts) as scale economies was not optimised from the lower revenue contribution of its addition and alteration segment. Order book of $84.6m will be progressively delivered over the next two years. The group see healthy demand for its services from on-going government initiatives to renew and rejuvenate middle-aged and mature estates, but highlight rising cost pressures from labour and cost of materials. Counter trades at 1HFY14 annualized P/E of 10.6x.