United Engineers' net profit up 38% to $141m in Q4

Thanks to the divestment gains from the disposal of tech and environment business.

United Engineers' enjoyed a considerable uptick in its bottom line in 4Q16, boosted by the divestment gains from the disposal of its technology and environmental engineering businesses including Multi-Fineline Electronix, Inc., UES Holdings Pte. Ltd., and other non-core business.

According to the group, it recorded attributable profit from discontinued operations of $113.2 million including approximately $123 million from the said divestment.

However, revenue from continuing operations comprising Property Rental & Hospitality, Property Development, Engineering & Distribution, as well as Manufacturing, decreased 44% to $479.7m mainly due to lower revenue from the property development business following the completion of Eight Riversuites.

Here's how United Engineers' segments performed: 

Property Rental & Hospitality revenue decreased 3% to $135.2 million. Excluding one-off items, operating profit before interest increased 4% to $69.0 million.

Revenue in Property Development segment decreased 82% to $70.8 million mainly due to lower revenue recognition from Eight Riversuites. Operating loss before interest was $23.2 million in 2016 compared with an operating profit before interest of $18.4 million in 2015 mainly due to lower revenue and profit in Singapore operations as well as higher impairment and operating expenses incurred by operations in China.

Engineering & Distribution revenue decreased 11% to $136.9 million mainly due to lower contribution from O’Connor’s, the Group’s systems integration business. Operating profit before interest increased 63% to $9.1 million mainly due to higher profit contributions from the distribution businesses and lower losses recorded by the systems integration businesses.

In the Manufacturing segment, revenue decreased 7% to $89.5 million. Operating profit before interest was $6.7 million in 2016 compared with an operating loss before interest of $4.6 million in 2015 mainly due to improved manufacturing efficiency and cost control in its operations in China.