NSL (N02) H1 2024 earnings summary

Executive summary

• Revenue for 1H 2024 declined 28% year-over-year to S$123.1 million, mainly due to lower sales in the Precast & PBU division, especially in Finland and Malaysia.

• Profit before tax dropped 53% to S$4.8 million, impacted by a S$4.0 million goodwill impairment in the PBU division and lower operating profits.

• Profit attributable to equity holders fell 67% to S$2.3 million; EPS decreased to 0.62 cents from 1.89 cents.

• Environmental Services division showed strong growth, offsetting some declines in other segments.

• No interim dividend declared for 1H 2024; S$7.5 million in dividends paid relating to the previous year.

Financial highlights

• Gross profit margin improved to 20% from 18% despite lower sales, driven by Environmental Services.

• Operating cash flow was S$9.0 million, down from S$12.4 million in 1H 2023, mainly due to lower profits.

• Net cash outflow for the period was S$3.0 million, with cash and cash equivalents at S$94.6 million as of 30 June 2024.

• Net asset value per share was S$0.72 at 30 June 2024, down from S$0.73 at year-end 2023.

Outlook and guidance

• Precast business in Singapore, Malaysia, and Dubai continues to execute secured projects, but PBU in Finland faces a depressed housing market.

• Environmental Services expected to remain stable, though scheduled maintenance by a key customer may impact industrial wastewater business in 2H 2024.

• The Group is broadening its customer base to mitigate risks in Environmental Services.

• On 23 July 2024, a pre-conditional mandatory general offer for all shares was announced by YTL Cement Berhad.