Tiong Woon net profit up 46% to S$13.4m in 1H2014

Stronger gross profit despite lower turnover.

Singapore Exchange Mainboard-Listed Tiong Woon Corporation Holding Ltd (Tiong Woon or the Group) reported a net profit attributable to equity holders of S$13.4 million on S$89.0 million of turnover for the six months ended 31 December 2013 (1H2014). This is a 46% increase from S$9.1 million.

The 10% decrease in turnover in 1H2014 was mainly due to lower contributions from Engineering Services and Trading divisions, the firm said.

Despite a lower turnover, gross profit for 1H2014 increased by 15% from S$28.0 million to S$32.1million. Gross profit margin for 1H2014 was stronger at 36% compared to 28% in the same corresponding period. The stronger gross profit margin was due to a 20% decrease in cost of sales achieved by the Group.

Commenting on the results, Mr. Ang Kah Hong, Tiong Woon’s Group Chairman and Managing Director said: “We have maintained a steady momentum over the past quarters and achieved continued improvement in margins. In the light of the challenging business environment, we will remain vigilant in growing our core businesses and strive for greater improvements in operational efficiency, cost control and financial management. Tiong Woon will continue to maintain its competitive edge by focussing on staff training and labour productivity improvement measures.”

For its outlook, the Group expects demand for heavy lift and haulage from the oil and gas, and petrochemical industries to be resilient in the region.

In Singapore, the Group’s heavy lift and haulage businesses will be supported by the strong pipeline of public and private sector housing, petrochemicals and infrastructure projects. In other ASEAN countries and the Middle East, the Group will also focus on oil & gas and petrochemical, infrastructure development and construction opportunities. The Group will forge strategic alliances and cooperation with international contractors and industry players to jointly participate in the bidding for projects.

While there are ample business opportunities, it is anticipated that labour and other operating costs continue to be on the rise. To improve productivity and operational efficiency, the Group will continue to upgrade the skills of its workforce. The Group will stay competitive by making continued improvements in operational efficiency, cost control and prudent financial management. It will continue to invest in higher capacity and specialised equipment, so as to widen the range of service offerings to its clients and stay ahead of competition.

The Group will continue to leverage on its competitive strength as a one-stop integrated services provider in project management for heavy lift and haulage, marine transportation and engineering services.

In anticipation of the increased operational needs of the Group’s future expansion, the Group will invest and redevelop it’s headquarter premises at 15 Pandan Crescent in Singapore.