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Venture Corporation Ltd Reported A 72.2% Increase In Net Profit In Its Latest Earnings Update

Last week, Venture Corporation Ltd (SGX: V03) announced its 2018 first quarter earnings update. As a quick introduction, Venture is an electronics manufacturing services provider with expertise in a wide range of activities.

Here are nine things investors should know about the company’s latest results:

1. Revenue for the quarter increased by 1.5% year-on-year to S$856.0 million.

2. Profit before tax shot up by 64.4% to S$98.6 million; the company’s profit before tax margin in the reporting quarter increased significantly from 7.1% a year ago to 11.5%.

3. Profit attributable to shareholders did even better, increasing by 72.2% to S$83.7 million.

4. Venture’s diluted earnings per share (EPS) was subsequently up by 67.4% year-on-year to 28.8 cents.

5. As of 31 March 2018, the company had S$765.3 million in cash on the balance sheet and just S$40.7 million in total debt. This gives it a net cash position of S$724.6 million, up from S$399.6 million as of 31 March 2017.

6. Operating cash flow for 2018’s first quarter was S$38.2 million, up from just S$7.0 million a year ago. The improvement in operating cash flow was mainly due to growth in Venture’s profitability.

7. The company’s working capital increased by S$19.0 million sequentially to S$899.8 million, mainly due to higher inventories and a decrease in trade payables, offset partially by lower trade receivables.

8. As of 31 March 2018, Venture’s book value was at S$2.25 billion, up 13.3% from S$1.99 billion a year ago. Consequently, Venture’s book value per share rose 10.4% from S$7.11 to S$7.85.

9. In its earnings update, Venture provided the following outlook statement:

“In spite of the weakened US dollar and heightened uncertainty due to geo-political environment, the Group managed to report a creditable set of results in the first quarter of 2018.

The Group remains steadfast in execution along several key initiatives. Venture continues to leverage its core capabilities in engineering, advanced manufacturing and supply chain management to drive operational excellence and deep value creation. Venture plans to grow its pool of strategic partnerships and its technological diversity with expansion into new and adjacent ecosystems. Excellent execution of these ongoing and new initiatives will support the Group’s endeavor to build sustainable growth and performance.”

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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 Lawrence Nga doesn’t own shares in any companies mentioned.