A new subsidiary of Catalist-listed GKE Corporation Limited has entered into an agreement to be one of Singapore Telecommunications &rsquo (Singtel) distributors in Singapore.

 

Under the agreement, GKE Retails will own and operate nine Singtel Exclusive Retailer outlets in Singapore to provide lifestyle products, along with Singtel-related products and services, which include mobile handsets and accessories, broadband solutions, Singtel TV and smart home solutions. 

 

GKE has partnered with an undisclosed &ldquo experienced dealer&rdquo who specialises in retailing and consumer services. This partner has operated through his own outlets &ldquo in the past few years&rdquo , says GKE CEO and executive director Neo Cheow Hui. 

 

Neo refers to this dealer as &ldquo the JVP&rdquo . GKE will own 60% of GKE Retails, with the JVP holding the remaining 40%.

 

GKE Retails will acquire five retail outlets, including the lease of premises owned and managed by the former distributor along with four retail outlets owned and operated by the JVP. 

 

GKE Retails will own and operate nine retail outlets in Singapore to conduct retailing and consumer services business and also oversee another seven retail outlets that are owned and operated by independent dealers under the dealership arrangement.

 

The move follows shareholder approval on Jan 27 for GKE to diversify into the sales and distribution of telecommunications mobile handsets and accessories business in Singapore. GKE incorporated GKE Retails on Jan 15.

 

This expands GKE&rsquo s operations from integrated warehousing and logistics solutions in China and agriculture in Singapore. 

 

The group does not expect this new business to have a material impact on its financial results for the financial year ending May 31.

 

GKE Corp has reported record interim earnings of $4.41 million for its 1HFY2025 ended Nov 30, up 132.5% over the year-earlier period. Revenue was up 13.8% to $63.16 million. The company attributes the better bottom line to better operational performance of its warehouses. 

 

In addition, GKE booked a one-off gain of $1.1 million from the sale of its mining rights and its related equity investment in China.

 

The company plans to pay an interim dividend of 0.05 cents per share. " We are delighted to share the fruits of our focused efforts with our key stakeholders, who have placed their trust and support in us," says CEO Neo Cheow Hui.

 

Following the divestment of the mining rights, GKE maintains a presence in China with its ready-mixed concrete plant. It says it " remains vigilant in conducting its infrastructural materials and services business in China, focusing on cost efficiency as the economy gradually recovers."

 

The warehousing and logistics business, here in Singapore, has maintained a moderate level of growth and stability. 

 

Last October, the company set up a wholly-owned unit to explore overseas opportunities.

 

More recently, on Jan 9, GKE announced plans to diversify into the mobile handsets distribution business. This move requires shareholders' approval and an EGM will be called.

 

&ldquo We believe that it is timely for us to embark on new business opportunities to diversify our business and broaden our earnings base, leveraging the sound foundation of our core operations and strategic investments," says Neo.

 

" While these initiatives offer attractive long-term growth potential that could in turn enhance shareholders&rsquo value and returns, we maintain our prudence in pursuing these viable business opportunities to safeguard the interest of our key stakeholders," he adds.

 

Logistics and building materials firm GKE Corp is seeking shareholders' approval to diversify into a new business of distributing mobile handsets, and will do so by buying over the distribution business of an existing player.

 

Together with a partner, GKE will then run the distribution business via their venture, where GKE will hold 60% and the partner the remaining 40%.

 

According to GKE in an EGM circular, the joint venture company " intends" to work with one of the key telcos here to set up a chain of retail shops for this. It has already identified certain locations and is in talks with the telco, which was not named.

 

GKE says the new handset distribution is meant to complement its current business so long as it " remains viable" . The company says this move will give it " better prospects of profitability and ensure long term growth."

 

While this new distribution business will start in Singapore, GKE says it has regional ambitions " if and when" suitable opportunities come about. It will also be open to distributing other products and not just handsets.

 

While GKE continues to run its warehouses, it has previously expanded into the production of ready-mixed concrete in China. 

 

On Jan 2, the company announced it is booking a one-off disposal gain from the divestment of rights to a limestone mine in China, which it bought back in May 2019, GKE paid RMB5.05 million for the rights to mine for 9.5 years.

 

Gains from this sale, plus improvements in other areas will lead to a " significant" increase for its 1HFY2025 earnings for the period ended November 2024, the company says.

 

GKE expects to report its 1HFY2025 results on or before Jan 14. The EGM will be held on Jan 27.