Koh Brothers Group Limited - Which property is undertaking the asset enhancement exercise?

8/12/2014 – A tight labour market and strict ruling by the Building and Construction Authority has alarmed Koh Brothers Group Limited.

It also worries about the falling prices of property caused by property cooling measures.

Managing Director and Group CEO, Mr Francis Koh, says the company will assess its internal procedures to reduce costs from improvements in construction methods to increase productivity and cut manpower needs.

He also adds, Koh Brothers will search for projects in Singapore and other countries to grow its business since the company have strong balance sheet and cash.

The owner of the Alocassia Apartments just announced earnings for Q3 FY14:

Revenue: -7% to S$82.2 mln
Profit: +3% to S$7.1 mln
Cash flow from operations: (S$29.3 mln) vs S$14.1 mln
Order book: Not disclosed

Sales dropped 7% to S$82.2 mln due to less revenue generated from Construction and Building Materials but net profit climbed 3% to S$7.1 mln in the quarter.

Allowance for trade receivables impairment has led to a rise in distribution costs to S$5.8 mln.

However, profit sharing from its ventured companies recorded a loss of S$1.2 mln due to lower contribution from a property that is undertaking an asset enhancement exercise.

The company increased its borrowings for development projects and secured against properties, plant and machinery, motor vehicles and fixed deposits.

Its total cash balance added up to S$63.9 mln was driven by its financing activities after deducting funds for development properties and buying land for a new joint venture project.

Investor Central. Asian insights for global investors. We ask the tough questions of Asian companies which global investors need answers to.

Question

1. What is its order book?

And in what time frame will the orders be delivered?

Question

2. Which property is undertaking the asset enhancement exercise?

Its share of earnings from joint ventures was a negative S$1.2 mln, compared to last year, when it made S$590,000.

The company says the loss was caused by lower contribution from a property, which is going through an asset enhancement exercise.

However, it did not state which property is undertaking the exercise.

Question

3. What are the initiatives to enhance the asset?

We would like to know what are the initiatives to enhance the value of its property?

If it is renovating the property, which part of the property is renovated?

What will it look like once it is completed?
Total number of questions in the full story: 12)

We have invited the company to an on-camera interview, and/or to reply to our questions in writing.

At the time of publication we have not received a reply (which is why you are seeing this message).

We will update this report if we do.

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