KUALA LUMPUR (Aug 19): Ho Hup Construction Company Bhd saw its net profit fall 16.8% on-year to RM14.18 million in the second quarter ended June 30, 2015 (2QFY15), from RM17.04 million, as some of its construction projects near completion.

Hence, earnings per share for 2QFY15 fell to 3.84 sen, from 6.66 sen previously, according to its quarterly report to Bursa Malaysia today.

Its construction division incurred a net loss of RM850,000 in 2QFY15, against a net profit of RM5 million a year ago, as its Kem Askar Johor and Karbala project in Iraq are reaching completion and so resulted in lower revenue.

A gratuity payment of RM1.3 million for retired directors was also a factor that dragged its performance, it added.

Meanwhile, its latest quarterly revenue came in at RM61.64 million, down 30.4% from RM88.53 million last year.

In the six-month period (1HFY15), Ho Hup’s net profit rose 20.9% to RM34.28 million, from RM28.36 million a year ago, although revenue fell 12.5% to RM149.60 million, from RM170.95 million in 1HFY14.

Notably, Ho Hup had eliminated its accumulated losses to a positive accumulated profits position of RM7.09 million, as at June 30.

Moving forward, the group said its property division will still be a growth segment, as it had recorded significant market traction in some of its projects.

Furthermore, Ho Hup believes its entrance into the Kota Kinabalu property market via its acquisition of a 70% equity interest in Golden Wave Sdn Bhd, is expected to contribute positively to the group in FY16.

Ho Hup (fundamental: 1.9; valuation: 1.5) rose two sen or 2.26% to 90.5 sen today, for a market capitalisation of RM312.3 million.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)