Investors are always on the lookout for growth, as this usually forms the primary reason for investing (the other primary reason being yield). Growth does not always occur in a smooth, straight line, though. Some companies may experience bouts of weakness before they manage to grow again, while others may see “lumpy” growth due to economic or industry factors.
In the current tepid economic environment, characterised by an ongoing trade war and slowing global growth, many companies struggle to grow as they are beset by weak demand and higher costs. Having said that, here are four companies which managed to report growth in both top and bottom lines for their latest quarter.
Mindchamps Preschool Ltd
Mindchamps Preschool Ltd (SGX: CNE) reported a 66% year-on-year jump in revenue to S$10 million in its first quarter of 2019 (Q1 2019). Net profit soared 34% year-on-year to S$426,000. The increase in the top line was due to higher levels of school fees from an increased number of enrolled students, post Mindchamps’ acquisition of preschool centres. There was also an increase in non-recurring franchise income and higher royalty income from franchisee-owned franchisee-operated centres.
As a recap, Mindchamps runs premium range preschools in Singapore with a market share of 38.5%. The group also has a presence in Australia, Abu Dhabi, Philippines, Vietnam, Myanmar and Malaysia.
VICOM Limited (SGX: V01) is a leading provider of technical testing and inspection services in Singapore with two main divisions: vehicle testing and non-vehicle testing. For its Q1 2019 earnings, VICOM reported a 4.1% year-on-year increase in revenue to S$25.5 million, while net profit attributable to shareholders rose 4.8% year-on-year to S$7.3 million. Better business volumes drove the increase in revenue and net profit in its vehicle inspection division, which was offset by weaker results from its non-vehicle testing division.
Sheng Siong Group Ltd
Sheng Siong Group Ltd (SGX: OV8) is a supermarket chain with outlets located mainly in the heartland areas of Singapore. In addition, the group has also opened one outlet in Kunming, China, with a second outlet slated to be opened by the end of Q2 2019 in the same city.
Sheng Siong reported good growth in its Q1 2019 earnings, with revenue rising 10.1% year-on-year to S$251.4 million. Net profit increased by 6% year-on-year to S$19.4 million. The increase in revenue was driven by ten new store openings but was offset by negative same-store-sales growth (which shrank 1%).
Singapore Technologies Engineering Ltd
Singapore Technologies Engineering Ltd (SGX: S63), or STE for short, is an engineering firm which has four main business arms: Aerospace, Electronics, Land Systems, and Marine. In its recent Q1 2019 earnings, STE reported a 5.1% year-on-year improvement in revenue to S$1.73 billion, while net profit attributable to shareholders increased by 11.4% year-on-year to S$131.1 million. It was a mixed performance across STE’s divisions as both Aerospace and Land Systems divisions grew revenue year-on-year, while the Electronics and Marine businesses didn’t post any growth.
As at 31 March 2019, STE had a record order book of S$14.1 billion, of which S$4.2 billion is expected to be delivered during the remainder of 2019.
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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. The Motley Fool Singapore has recommended shares of Sheng Siong Group Ltd and VICOM Limited. Motley Fool Singapore contributor Royston Yang owns shares in VICOM Limited.