SHS Holdings (566) H2 2023 earnings summary

Executive summary

• FY2023 revenue declined 5.8% to S$82.2m, with lower Engineering & Construction sales partly offset by growth in Solar Energy and Corrosion Prevention; attributable profit was S$2.5m.

• Solar Energy was the strongest growth segment, while fewer Engineering & Construction projects and margin pressure in Corrosion Prevention weighed on results.

Financial highlights

• Revenue was S$82.204m vs S$87.222m; gross profit S$12.934m vs S$19.065m; profit before tax S$3.366m vs S$5.748m.

• Profit after tax was S$2.762m vs S$5.634m; profit attributable to owners was S$2.495m vs S$5.056m.

• Other income rose to S$3.207m from S$2.447m, mainly reflecting S$1.786m interest income; finance costs increased to S$1.099m from S$0.689m.

Outlook and guidance

• Singapore construction demand is expected to remain robust, supporting steel engineering prospects; priorities include completing projects and building the Design Studio order book.

• Solar demand is expected to benefit from regional energy transition and volatile Singapore wholesale electricity prices; near-term commitments to new solar development projects remain cautious.

• Corrosion Prevention will manage orders prudently to protect margins amid rising costs and intense competition; overall decisions remain cautious given economic and geopolitical uncertainty.