Kingsmen Creatives (5MZ) H1 2024 earnings summary

Executive summary

• H1 2024 revenue rose 20.6% YoY to S$173.385m; profit attributable to equity holders more than doubled to S$1.256m, while operating cash flow reached S$9.610m.

• Growth across all four operating segments was partly offset by higher employee costs and lower gross margin; other income included a S$2.076m gain on disposal of assets held for sale.

Financial highlights

• Revenue increased 20.6% YoY to S$173.385m from S$143.8m; gross profit rose 15.0% to S$37.662m from S$32.8m.

• Profit before tax climbed to S$4.017m from S$0.840m; profit net of tax was S$3.522m versus S$0.240m, and profit attributable to equity holders was S$1.256m versus S$0.600m.

• Other income increased 117.6% to S$3.312m, including a S$2.076m gain from disposal of assets classified as held for sale.

• Employee benefits expense rose 14.2% to S$29.836m; other expenses increased 1.8% to S$5.691m, including S$0.585m impairment loss on doubtful receivables.

Outlook and guidance

• As at 31 July 2024, secured contracts totalled S$367m, of which S$290m was expected to be recognised in 2024.

• Management expects a robust second half, supported by demand for differentiated customer experiences and a strong contract pipeline; results were in line with prospect commentary disclosed on 22 February 2024.

• Selective project acceptance, cost control, margin focus and client readiness remain priorities; no H1 dividend was declared or recommended, with cash retained for business operations.