BRC Asia reported higher 1QFY24 revenue (+17.0% y-o-y) of S$399.2m and net profit of S$17.1m (+46.5% y-o-y), slightly above our expectations. The outperformance was largely driven by the ongoing recovery in domestic construction demand coupled with the absence of Singapore’s Heightened Safety period.
Despite 1QFY24 being a seasonally slow quarter, BRC Asia (SGX:BEC) reported higher
1QFY24 revenue (+17.0% y-o-y) and gross profit (+51.3% y-o-y), forming 24.4% and 25.5% of our full-year forecasts respectively.
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The strong top-and bottom line growths were largely due to a low base in 1QFY23 from Singapore’s Heightened Safety period depressing delivery volumes while also driven by the ongoing recovery in domestic construction demand.
Margin expansion.
BRC Asia's 1QFY24 gross (+2.0ppt y-o-y) and net margins (+0.9ppt y-o-y) expanded respectively which we reckon was driven by higher volumes and utilisation rate coupled with some net reversal of provision for onerous contracts due to moderating steel prices.
As a recap, BRC Asia still had around S$13.5m of provisions on its balance sheet at end-4QFY23.
Orderbook strong via dominant market share.
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