Friday, August 29, 2014

Sim Lian

Sim Lian: FY14 net profit inched up 2% to $171.0m on revenue of $714.7m (-4%). The slight dip in revenue was due to a 14% decline in revenue from the group’s property division segment to $506.7m, as it saw reduced contribution from Waterview and several completed property development projects. This was partially offset by increase in revenue contribution from Centrale 8 At Tampines and Parc Vera project which is at the peak of the construction cycle. The construction division fared better with revenue rising 34% to $172.4m, due to an increase in percentage of work done. While margins were aided by an 8% drop in raw materials and consumables costs to $481.9m, fairvalue losses of $15.5m for the group’s investment properties versus fairvalue gains of $1.6m from the previous year, weighed on the group’s bottom-line. Going forward, Sim Lian guides that with the past rounds of property cooling measures and the loan restrictions measures, the group expects the operating environment for private residential property market to continue to be challenging. The group aims to seek strategic investment opportunities for its continued growth and is focused on building a stable base of recurring income to smoothen its fluctuating profits from the property development division. The group has declared a first and final dividend of 4.6¢ per share (FY13: 4.6¢).

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