Lian Beng's revenue for second quarter down 35%

Construction group Lian Beng posted lower sales for the second quarter due to a poor showing from its construction and ready-mixed concrete segment.

Revenue for the three months to Nov 30 was $130 million, down 35 per cent from the same period a year earlier. Net profit dipped 2.8 per cent to $22.9 million.

The results were "in line with the cautious market outlook previously announced", said the company.

Earnings per share for the quarter was 4.53 cents, up from 4.5 cents a year earlier. Net asset value per share was 98.9 cents as at Nov 30, up from 91 cents as of May 31 last year.

Revenue for the half year dropped 27.7 per cent to $265.6 million from a year earlier but earnings jumped 55.4 per cent to $55.1 million, thanks to higher share of profits from associates and joint ventures. These include three residential property development projects, one industrial development project and office unit strata sales of Prudential Tower.

Lian Beng declared an interim dividend of one cent per share. "Our strong results have enabled us to reach a healthy cash level of $198.7 million as at Nov 30, 2015, which allows us to continue to explore opportunities - local and overseas - to further expand our business," said executive chairman Ong Pang Aik.

The company said: "The construction industry outlook is expected to remain challenging in the next 12 months with labour cost remaining high due to higher foreign worker levies."

But it is "cautiously optimistic", citing the existing pipeline of construction projects worth $350 million as of last Nov 30, which will provide it with a sustainable flow of activities through the next financial year.

Lian Beng shares closed flat at 49.5 cents yesterday, before the results were announced.

This article was first published on January 14, 2016.
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