Yongnam reports 2018 net loss widened on project provisions and lower revenue

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Yongnam Holdings reported on Thursday its 2018 net loss widened to S$51.02 million from a net loss of S$16.96 million a year earlier amid provisions on projects and lower revenue.

Revenue for the year ended 31 December fell 47.4 percent on-year to S$161.45 million, it said in a filing to SGX after the market close on Thursday.

The company said it also made provisions on expectation of lower negotiated variation orders for two structural steelworks projects and lower project margins for Thomson MRT projects.

“Yongnam continued to face a challenging business and operating environment in 2018, which impacted our financial performance and resulted in provisions in negotiated variation orders and lower margins,” Seow Soon Yong, CEO of Yongnam, said in the statement.

“Besides managing costs and improving operating efficiencies, Yongnam also actively pitched for new projects which enabled the group to end 2018 with a substantially stronger order book of S$366 million compared to a year ago,” he said. “These projects included supply contracts for infrastructural developments in the State of Victoria which marked our first foray into Australia.”

The structural steelworks segment saw revenue fall 58.4 percent on-year to S$81.7 million for the year, mainly on the substantial completion of Senoko Food Hub and Jewel Changi Airport project at end-2017, the filing said.

The specialist civil engineering segment posted a 27.8 percent fall in revenue to S$64.3 million for 2018, on lower contributions from the Thomson MRT project and the completion of certain MTR projects in Hong Kong.

Design and build projects revenue fell 44.2 percent on-year to S$11.1 million for the year, mainly on the substantial completion of a project for light industrial developments at Kallang Junction in Singapore at end-2017, the filing said.

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