Centurion profit down 58% on absence of one-off gain but earnings from core operations up 66%

SINGAPORE - Mainboard-listed Centurion Corporation announced on Monday that its net profit for the first quarter fell 58 per cent to $9.4 million from the year-ago period's $22.63 million, which included a one-off gain of $17.3 million from the sale of industrial factory units.

However, revenue for the three months to March 31, 2015, increased 44 per cent to $25.3 million. This growth was mainly driven by its accommodation business, which saw a 56 per cent or $8.5 million increase in revenue.

The firm said successful expansion into the student accommodation business in Australia and the UK in February and September respectively last year accounted for 64 per cent, or about $5.5 million, of revenue growth.

Centurion said the strong contribution of the new student accommodation assets signifies the success of its strategy to expand its earnings base beyond the workers accommodation business.

Net profit from its core business operations jumped 66 per cent to $9.2 million in the first quarter.

Finance costs increased by $1.8 million, mainly due to additional interest costs incurred for the financing of the newly acquired student accommodation portfolio in the UK, as well as the bank facility fee incurred in financing the development of ASPRI-Westlite Dormitory - Papan.

Looking ahead, Centurion said its accommodation business remains positive, supported by stable demand for both its workers and student accommodation across Singapore, Malaysia, Australia and the UK.

With Westlite Tampoi in Malaysia commencing operations in January 2015 and the expected completion of Westlite Woodlands with 4,100 beds in Q3 2015, Centurion said it is on track to achieve continued growth in its core business in 2015.

It will also "selectively explore opportunities in both existing and new markets to further grow its accommodation business."

In a separate announcement on Monday, Centurion also announced steps "to strengthen its board with new expertise and greater independence".

Mr David Loh Kim Kang and Mr Han Seng Juan will join Centurion's board of directors as non-executive directors. Mr Loh and Mr Han are the group's controlling shareholders and hold an aggregate 55.34 per cent stake in the company.

At the same time, Mr Kong Chee Min, Centurion's CEO, and Mr Tony Bin, executive director of the group's accommodation business, will step down from the board and remain in the executive management team.

Centurion said the the changes are a move towards separating the management from the board, which will now comprise three non-executive directors and two independent directors.