This article first appeared in The Edge Financial Daily on November 24, 2017

KUALA LUMPUR: Sarawak-based marine engineering and infrastructure specialist Hock Seng Lee Bhd (HSL) reported a 32% year-on-year (y-o-y) decline in net profit in its third financial quarter ended Sept 30, 2017 (3QFY17) to RM11.06 million from RM16.34 million, as its construction segment reported lower revenue and profit margin.

Quarterly revenue dropped 7% y-o-y to RM126.33 million from RM136.03 million, due to timing of the progress claims as major contract works were at their initial stages of execution, its Bursa Malaysia filing yesterday showed.

Construction made up 78% of the group’s revenue, while property developement made up the remainder 22%.

For the first nine months of FY17 (9MFY17) HSL’s net profit fell 29% y-o-y to RM31.86 million from RM44.68 million, while revenue declined 12% to RM337.9 million from RM385.34 million.

It completed RM287 million worth of projects in 9MFY17.

In a statement, HSL said it had RM2.7 billion worth of works unbilled as at Sept 30, having added some RM586 million in new projects over the 9MFY17 period. This, it said, gives it half a billion ringgit more in outstanding revenue compared with the end of 9MFY16.

HSL managing director Datuk Paul Yu Chee Hoe said the group has had a good quarter in terms of procurement and productivity.

Group net profit before tax for the current quarter reached RM15.11 million, up 18% from RM12.78 million in 2QFY17.