United Engineers posts 165% jump in Q2 profit to $40.8 million

SINGAPORE - Higher revenue recognition from its property developments and contributions from automative unit WBL Group lifted United Engineers' (UE) quarterly earnings.

But there are dark clouds ahead in the Singapore and China property markets, prompting the firm to say it will be more cautious in the segment.

Net profit jumped 165 per cent for the second quarter ended on June 30 to $40.8 million, as revenue soared more than four times to a whopping $1.22 billion.

Full revenue recognition from the property sales at Austville Residences, as well as progressive revenue recognition of Eight Riversuites boosted revenue of the property development business.

Net profit for the half year stood at $48.5 million, 112 per cent higher than the same period a year ago, as revenue hiked 345 per cent to $1.96 billion

UE corporate office chairman Norman Ip said in a statement on Thursday: "The group has been enhancing and unlocking value of the enlarged operations as well as growing its core businesses, following the successful integration with the WBL Group.

"We believe that we will be able to capitalise on the resources and geographical presence of the enlarged Group to expand its core businesses for the next phase of growth."

But things are not always going to be smooth-sailing in the days ahead, as the company said the property sector cooling measures in Singapore and China "will continue to affect sales."

"As such, the group will remain cautious in bidding for new land sites in Singapore and China," the firm said in a statement.

Earnings per share was 6.4 cents in the quarter, up from 4.1 cents in the same period a year ago.

Net asset value per share is $2.79 at the end of June, dipping from $2.84 at the end of December.

UE shares closed down a cent to $2.27 on Thursday. It reported its earnings after markets closed.