Riding construction boom, Koh Brothers reverses into black with $18.6 million net profit attributable to shareholders

 

For FY2025 ended Dec 31, construction and engineering solutions provider Koh Brothers reported $18.6 million in net profit attributable to shareholders, in contrast to the loss of $5.5 million for the previous year. The company had a strong showing for 2HFY2025, with net profit attributable to shareholders increasing by 824% y-o-y to nearly $16 million from $1.7 million.

With Singapore&rsquo s construction sector booming, revenue surged 38.2% y-o-y to reach $329.4 million. Combined with higher gross profit margin contribution from the construction and building materials division, as well as the real estate division, the company reversed into the black.

Koh Brothers is proposing a final dividend of 0.3 cents and a special dividend of 0.6 cents. Together with the interim dividend of 0.1 cents declared for 1HFY2025, total distributions will be one cent per share for the year.

On a segmental basis, revenue for the construction and building materials division jump 43% y-o-y to nearly $321 million real estate revenue plunged nearly 51% y-o-y to $5.2 million and leisure and hospitality revenue declined by 10% to below $3.3 million.

The completion of the disposal of a plot of land in Johor, Malaysia led to other gains jumping 310% y-o-y from $3.4 million in FY2024 to $14 million in FY2025. This was partially offsetted with some offset from fair value loss on investment properties and unrealised foreign exchange loss on trade receivables and cash and bank balances arising primarily from the weakening of the United States dollar against the Malaysia Ringgit under the bio-refinery and renewable energy segment.

The company increased its cash and cash equivalents by 60% y-o-y to more than $114 million with net gearing ratio at 0.09 times as at Dec 31, 2025. Net asset value per share stood at 68.6 cents as at the end of the current reporting period, compared to 63.01 cents one year earlier.

Koh Brothers&rsquo order book stands at $1.1 billion. The company notes the Building and Construction Authority&rsquo s projection that the total value of construction contracts is expected to range between  $47 billion and $53 billion  in nominal terms in 2026. This will be supported by the awarding of additional construction packages for Changi Terminal 5 Development, Marina Bay Sands Integrated Resort expansion, New Tengah General & Community Hospital, Downtown Line 2 and Thomson-East Coast Line Extensions, with construction demand projected to reach an average of between $39 billion and $46 billion per year from 2027 to 2030.

In a statement, the company says that it is strategically positioned to continue leveraging its established track record, extensive experience, and expertise to tender for more construction projects. &ldquo The Group is well-positioned to capture opportunities arising from sustained public and private sector construction demand,&rdquo says executive chairman and Group CEO Francis Koh.

The company also expects that the private residential market to remain &ldquo challenging&rdquo and it will maintain a &ldquo cautious&rdquo approach and exercise selectivity in replenishing its land bank.

Shares in the counter closed at 33 cents on Feb 13, unchanged from the previous trading day.