Venture Corp more than doubled its earnings in the fourth quarter, thanks to higher research and development (R&D) turnover.
Net profit surged 164.5 per cent to $143 million, while revenue in the three months to Dec 31 was up 27.1 per cent to $1.086 billion over the same period a year earlier. This was Venture's third straight quarter of revenue above $1 billion.
Net profit margins in the fourth quarter were 13.2 per cent, or 12.1 per cent if a one-off gain on disposal of an associate was excluded.
Fourth-quarter earnings included a $11.3 million gain on the disposal of an associate. Excluding this gain, net profit was up 143.4 per cent to $131.7 million.
Chief financial officer Alvin Ng told a results briefing last night: "R&D revenue this quarter was significantly higher, partly because of the milestones we had achieved.
"R&D is definitely a premium service. This explains why the fourth-quarter margin is on the high side."
Full-year net profit jumped 106.3 per cent to $372.8 million, beating street estimates, while revenue hit a record $4 billion, up 39.3 per cent from 2016.
AT A GLANCE
REVENUE: $4 billion (+39.3%)
NET PROFIT: $372.8 million (+106.3%)
DIVIDEND PER SHARE: 60 cents (+20%)
A big boost came from Venture's "test and measurement/medical and life science/others" segment, where turnover jumped 83.9 per cent to $2.29 billion.
Once again, chief executive Wong Ngit Liong declined to reveal the identities of Venture's largest customers, except to say that it has "well over a hundred" customers.
"A big chunk of our customers are growing and they contribute 75 per cent of our revenue," he said.
A final dividend of 60 cents was declared, up 20 per cent from 50 cents in the same period a year earlier.
Venture had net cash of $752.4 million at the end of last year, up from $499.7 at the end of 2016.
Mr Ng said: "Venture is still very hungry for growth. The next leg of development will be an ongoing, multi-year transformation. It will entail more intensive preparation and investment in the development of new engineering and advanced manufacturing capabilities."
Fourth-quarter earnings per share were 49.5 cents, up from 19.3 cents in the same period a year earlier. Full-year earnings per share were $1.30, up from 64.8 cents in 2016.
Net asset value per share was $7.609 as of Dec 31, up from $7.031 at the end of 2016.
Venture shares closed up 46 cents to $27.56 yesterday before the results were released.