We are now in the busiest part of earnings season. Some companies are reporting good news, and some are disappointing us with bad news. Still more companies are falling somewhere in between; here’s a look two companies that have recently reported mixed results.
First up is Kimly Ltd (SGX: 1D0).
Kimly is one of the largest traditional coffee shop operators in Singapore. It currently operates a chain of 67 food outlets and 129 food stalls under various brands island-wide. It was listed on the Catalist Board of the Singapore Exchange Securities Trading Limited on 20 March 2017.
For the quarter ended 31 December 2018, Kimly reported that revenue grew by 5.0% year on year to S$52.6 million. Gross profit improved by 4.4% year on year to S$10.6 million, mainly due to the growth in revenue. Yet, net profit attributable to shareholders for the quarter fell by 8.2% year on year to S$5.3 million, driven mainly by higher selling, distribution, and administrative expenses. Similarly, Kimly’s earnings per share (EPS) also fell by 8.0% to 0.46 Singapore cents. Kimly had no borrowings as of 31 December 2018, while its cash and bank balances stood at S$91.1 million.
Going forward, Kimly expects to remain profitable in 2019 thanks to the various initiatives it has in place, which include expanding its portfolio of coffee shops and product offerings, streamlining outlet operations, and further optimising its central kitchen.
Singapore Technologies Engineering Ltd (SGX: S63), or STE, is the second company we’re looking at today. STE is a conglomerate with business interest in various sectors, namely aerospace, electronics, land systems, marine, and others.
For the year ended 31 December 2018, STE reported that revenue grew by 2.7% year on year to S$6.7 billion. Similarly, earnings before interest and taxes (EBIT) for the year improved by 5.0% year on year to S$570.3 million. Yet, profit attributable to shareholders for the year declined by 1.7% year on year to S$494.2 million. Similarly, earnings per share (EPS) fell from 16.13 Singapore cents last year to 15.85 Singapore cents in 2018. The weaker profit was due to one-off charges. Excluding such charges, net profit would have increased by 9% year on year.
The engineering conglomerate’s order book stood at S$13.2 billion at the end of the year, with S$4.9 billion of its order book to be delivered in 2019. The company also proposed a final dividend of S$0.10 per share. Together with the interim dividend of S$0.05 per share, shareholders will receive a total dividend of S$0.15 per share for 2018.
STE’s president and CEO, Vincent Chong, commented:
“The Group delivered a resilient set of results and maintained the momentum for new contracts. Excluding one-off charges mainly incurred to rationalise our portfolio, the underlying operating performance of our business sectors remained strong.
We continue to invest in growth initiatives and capabilities including data analytics and cybersecurity to drive long-term sustainable growth, backed by a healthy level of order book that provides revenue visibility for the next few years.”
Click here now for your FREE subscription to Take Stock Singapore, The Motley Fool’s free investing newsletter. Written by David Kuo, Take Stock Singapore tells you exactly what’s happening in today’s markets, and shows how you can GROW your wealth in the years ahead.
The Motley Fool’s purpose is to help the world invest, better. Like us on Facebook to keep up-to-date with our latest news and articles.
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.