Dyna-Mac swings to 1H21 net profit, expects to remain a going concern

Dyna-Mac Holdings reported Wednesday it swung to a first half net profit attributable to equity holders of S$2.49 million from a year-ago loss of S$14.22 million on more progress on projects during the period, compared with a production stand-down in the second quarter of 2020.

Revenue for the January-to-June period more than doubled to S$106.36 million from S$51.35 million in the year-ago period, the company said in filing to SGX.

Remains a going-concern

“Although the group expects the overall operating environment to remain challenging in the next twelve months amidst the Covid-19 pandemic, the group expects to secure additional contracts over the course of the year ahead,” Dyna-Mac said in the statement, adding the group believes it can continue as a going-concern for the foreseeable future.

“The group will continue to be able to utilise its existing credit facilities despite breaching loan covenants for certain facilities as management are in ongoing discussions with its bankers,” the company added, noting the banks have not requested early repayment of its bank loan or withdrawn its credit facilities. One bank has agreed to waive the non-compliance of the covenants on a subsidiary, it said.

The net order book was at S$328 million as of end-June, compared with S$204.02 million in the year-ago period, including a major order of around S$197 million, the company said. Completions and deliveries extend through 2023, it said.

Dyna-Mac added it obtained a new order of S$114 million after the end of the financial period.

Outlook

The company issued a cautious outlook, citing the impact from the Covid-19 pandemic.

“With the border controls and strict Covid-19 restrictions, we continue to face challenges in terms of supply chains and movement of people. To mitigate the shortfall of manpower, the group is widening its search for skilled labours from the region in addition to training our workers to be multi-skilled,” Dyna-Mac said.