KUALA LUMPUR (May 28): Engineering and construction services provider Kimlun Corp Bhd’s net profit for the first quarter ended March 31, 2015 (1QFY15) was down 25.6% to RM14.12 million or 4.7 sen per share, from RM18.97 million or 7.02 sen per share a year ago, primarily because its 1QFY14 saw gains from the disposal of land.
Its revenue for the quarter under review had also dipped 3.2% to RM322.17 million in 1QFY15 from RM332.69 million in 1QFY14.
In a filing with Bursa Malaysia, Kimlun (fundamental: 1.3; valuation: 2.4) said its 1QFY14 saw higher revenue and profit mainly due to the disposal of a few parcels of land.
If the contribution of the disposals are removed, the group would have achieved a growth in revenue and gross profit of 12.6% and 34.6% respectively, in the current quarter compared to 1QFY14, it said.
The construction division’s revenue, which improved by 14% with a few large projects secured, continued to be the main revenue contributor to the group — making up 84% of the current quarter’s revenue.
On prospects, Kimlun said its construction and manufacturing balance order books are approximately RM1.01 billion and RM0.23 billion (RM230 million) respectively, as at March 31.
“The balance order book[s], together, with the estimated unbilled property sales value of RM73 million from the Hyve (a SOHO development in Cyberjaya) on a 75% take-up rate, provides a good earnings visibility to the group,” it added.
The company is optimistic that the construction sector of Malaysia and Singapore will continue to be vibrant in 2015, thus order book replenishment prospects remain encouraging.
Kimlun shares closed unchanged at RM1.28 today, with a market capitalisation of RM384.72 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.)