OKP Holdings (5CF) H2 2023 earnings summary

Executive summary

• FY2023 revenue rose 36.3% to S$160.4m; attributable profit rebounded to S$44.6m from a S$1.0m loss in FY2022, supported by stronger construction and maintenance activity and other gains.

• Five public-sector contracts worth S$322.5m were secured in FY2023; the S$518.6m construction order book provides project visibility through 2027.

Financial highlights

• Gross profit rose 128.5% to S$24.7m from S$10.8m; gross margin improved 6.2 percentage points to 15.4%.

• Profit before taxation was S$51.1m versus S$0.5m in FY2022; net profit was S$47.4m and attributable profit was S$44.6m.

• Other gains increased to S$46.9m from S$3.0m, including interest income, an arbitral award related to the Contract 449A worksite incident and investment-property fair value gains.

• 2H2023 revenue rose 41.1% YoY to S$90.4m; attributable net profit was S$9.0m versus a S$2.2m loss in 2H2022.

Outlook and guidance

• Cautiously optimistic on construction in 2024, with priorities including prudent tendering, project execution, risk management, compliance and productivity.

• BCA forecast 2024 construction demand of S$32bn–S$38bn, including S$18bn–S$21bn from the public sector; public-sector demand of S$19bn–S$23bn annually was projected for 2025–2028.

• Strategic partnerships are a priority to expand property development and investment and strengthen recurring income.