SINGAPORE - Yangzijiang Shipbuilding Holdings reported its fourth quarter net profit leapt to 607.8 million yuan (S$124.5 million) from 41.5 million yuan a year ago on the back of a big cut in expenses and a jump in other income.
Expenses for the three months to Dec 31, 2016, fell 46 per cent to 324.7 million yuan in the quarter and other income surged 674 per cent to 306.4 million yuan from 39.6 million yuan.
The company said that other income jumped to RMB904 million in FY2016 from RMB271 million in FY2015, mainly due to the recognition of RMB660 million advance payment from the previous ship owners of the terminated shipbuilding contracts.
As for expenses, Yangzijiang said the absence of the impairment provision made in Q42015 in relation to a jack up drilling rig led to a 27 per cent decrease in administrative expenses in FY2016. Finance costs decreased by 14 per cent as compared to last year as group reduced the size of borrowings.
Revenue for fourth quarter rose 76 per cent to 5.5 billion yuan from 3.1 billion yuana year ago.
The shipbuilding business contributed 3.98 billion yuan in the quarter during which nine vessels were delivered according to schedule compared to six in Q42015.
For the full year, net profit fell 29 per cent to 1.8 billion yuan on the back of a 6 per cent drop in revenue to 15 billion yuan.
Revenue from shipbuilding business, making up 70 per cent of the total revenue, declined by 14 per cent to 10.5 billion yuan for the full year. This was due to the relatively smaller size and the lower contract value of the vessels delivered in FY2016, despite the total number of vessels delivered rising to 39 from 36 vessels in FY2015.
Earnings per share for the full year stood at 45.73 yuan cents from 64.19 yuan cents a year ago.
A final dividend per share of 4 Singapore cents has been proposed, lower than 2015's 4.5 cents.