BRC Asia (SGX:BEC)'s 9MFY24 financial performance fell short of our expectations, with revenue at S$1,140m (-3.1% y-o-y) and core net profit (excluding an S$16.5m gain from the disposal of its Maldives associate) at S$56.1m (+15.0% y-o-y), representing 65.8% and 63.3% of our full-year estimates respectively.
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9MFY24 results below our expectations, dragged by a soft quarter.
The weaker-than-expected 9MFY24 results were largely due to a soft 3QFY24, with revenue and core net profit declining to S$381.7m (-17.0% y-o-y) and S$17.6m (-22.0% y-o-y) respectively. This was primarily due to slower project execution and deliveries, as delays across both the private and public sectors came on a shortage of engineering resources and delays in inspection processes.
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Short-term outlook shows promising signs of recovery.
In early-4QFY24, BRC Asia observed encouraging signs of operational improvements, marked by a gradual alleviation of labour shortages. This has helped projects gain momentum, with increased movement in project executions leading to improved project offtake rates.
Coupled with a backlog of delayed projects and a robust pipeline, we reckon that this would lead to stronger earnings growth moving into 4QFY24.
Robust growth in Singapore’s construction sector…
Read more at SGinvestors.io.
Above is an excerpt from a report by UOB Kay Hian Research. Clients of UOB Kay Hian may be the first to access the full PDF report @ https://www.utrade.com.sg/.
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