Design Studio

Design Studio: 2Q14 net profit +50.7% y/y to $4.0m on higher gross profit (+21.4% y/y to $8.2m) achieved against 26.6% decrease in overall revenue to $32.6. Revenue from hospitality and commercial project halved to $14.8m, from distribution project shrank 86.0% to $35,000, offset by 20.8% rise in residential property projects to $17.7m.GPM +10ppt to 25.2% on higher margin projects and cost efficiencies. Order book is at record high $337.1m as at 7 Aug, but management expects operating environment to be challenging given property cooling measures in Singapore, China and Malaysia. Trades at 7.5x annualized 1H14 P/E and 1.1x P/BV