3 Questions About Centurion Corp Ltd’s Business Answered

Year-to-date, shares of Centurion Corp Ltd (SGX: OU8) have grown more than 70%. In comparison, the Straits Times Index (SGX: ^STI) has risen by a smaller magnitude of 20% during the same time frame.

More important than the share price movement, however, is the business fundamentals. With that, here are three things that you might be interested to know about Centurion Corp’s business right now.

What is the business about?

Centurion Corp, which was listed in 1995, is one of Singapore’s largest owner-operator of workers accommodation assets in Singapore and Malaysia. It also owns and operates student accommodation assets in Singapore, Australia, the United Kingdom and the United States.

Its workers accommodation assets are managed under the Westlite brand while the student accommodation assets are managed under the dwell brand.

The company expects to increase its overall portfolio of workers and student accommodation assets from around 61,608 beds, as of 30 September 2017, to about 66,148 beds by the end of next year.

On top of the accommodation business, Centurion Corp also operates a storage disc manufacturing business.

How did the company perform in its latest quarter?

For the third quarter ended 30 September 2017, revenue grew 15% year-on-year to S$32.3 million, but net profit fell 20% to S$6.1 million.

The revenue growth was mainly due to contributions from ASPRI-Westlite Papan, which obtained its temporary occupation permit in May last year, and has since recorded an average occupancy of over 95%. Also, higher occupancy at Westlite Woodlands and six operating workers accommodation assets in Malaysia contributed to the rise in quarterly revenue.

The fall in the bottom line was on the back of non-recurring professional fees paid out in preparation for the dual primary listing of the firm’s ordinary shares on the Hong Kong stock exchange.

What is the latest development surrounding the company?

With regards to the dual listing of its shares in Hong Kong, yesterday, the firm announced that the public offer portion of its shares offering on the country’s stock exchange was about 18.8 times subscribed while the placement portion was oversubscribed. A total of 36 million shares were offered, representing approximately 4.5% of the enlarged share capital of the firm.

The offer price was at HK$3.18 per share, and the shares started trading today at 9.30 am. The stock is currently (at 11.11 am) selling at HK$3.28 apiece under the code 6090.

Wong Kok Hoe, chairman and non-executive director of Centurion Corp, said:

“We are pleased with the positive responses from both the institutional and retail investors during the Share Offer, reflecting investors’ confidence in our business model, quality of our assets and management, and development prospects.

Looking ahead, we will continue to selectively explore opportunities to grow our accommodation business through targeted and strategic expansion in existing and new markets, joint ventures and asset light strategies, including establishing and providing investment, asset and property management services.”

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Sudhan P doesn’t own shares in any companies mentioned.