Koh Brothers Group suffers 33% revenue crash

Construction, real estate business are getting weak.

According to a release, Koh Brothers Group Limited announced net profit attributable to equity holders of the Company of S$13.2 million for the nine months ended September 30, 2012 (“9M2012”).

Net Profit for the previous corresponding financial period was S$18.6 million.

The lower Net Profit was mainly due to a 33.0% decrease in revenue to S$183.5 million for 9M2012, due mainly to lower revenue recognition from the Group’s construction and real estate business divisions.

In addition, the impact of the adoption of INT FRS 115 amounting to an increase in profit of S$9.7 million was reflected in 3Q2011.

Mr. Francis Koh, Managing Director and Group CEO of Koh Brothers, commented: “While issues such as weaknesses in the global economy, lower construction activity forecasts as well as the Government’s ongoing efforts to cool Singapore’s property sector have inevitably affected earnings growth, we were successful in our cost management strategies, keeping margins at healthy levels.

2012 continues to be an exciting year of developments for Koh Brothers. We’ve made new partnerships with Japan’s Okumura Corporation and UES Holdings, part of the UE group, and together, we will continue to look for opportunities in the private and public sector. We’re also pleased to have secured contract wins for the Jurong Water Reclamation Plant and the Changi retention pond, an endorsement of our strong track record in the specialised area of water reclamation, flood alleviation and drainage projects.

In property development, the launch of our Parc Olympia development has been well-received. We had also carried out a strategic investment through the proposed acquisition of Metax Engineering Corporation Ltd, which we trust will serve to augment the Group’s engineering capabilities and expand into the water and wastewater sector.”