Lian Beng's first-half profit drops 13.2% to $16.7 million on higher marketing costs

HIGHER marketing and sales costs for its property projects have put a drag on construction firm Lian Beng Group's first-half profit.

It posted a 13.2 per cent drop in net profit to $16.7 million dollars for the six months ended on November 30.

This was despite revenue jumping by 39.6 per cent to $328.1 million dollars, thanks to growth across all its business segments.

Cost of sales, however, went up by 40.4 per cent to $286.8 million from $204.3 million.

Lian Beng is cautiously optimistic about the outlook of the construction industry, after the Building and Construction Authority (BCA) raised its forecast for this year's total construction demand.

"With the upward revision of Singapore's construction demand from between $22 billion and $30 billion to between $31 billion and $38 billion for 2014, we would be able to seize the potential opportunities to tender and secure for more public and private sector projects ," said Mr Ong Pang Aik, executive chairman at Lian Beng.

Earnings per share for the six months ended Nov 30 stood at 3.15 cents, down from 3.63 cents in the same period a year ago.

The net asset value per share as of Nov 30 is 51.13 cents, up from 49.2 cents as of May 31.

Shares of Lian Beng, which reported its earnings after markets closed, ended one cent lower at 54.5 cents.