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Lincotrade & Associates Holdings sinks into the red in FY2023 with loss of $8.74 million

Lincotrade & Associates Holdings reports loss of $8.74 million for FY2023, mostly attributed to one-off expenses.

Mainboard-listed integrated interior fitting-out solutions specialist Lincotrade & Associates Holdings BFT has reported a loss of $8.74 million for FY2023 ended June 30, the group’s full year first financial statement following the reverse takeover (RTO) of Fabchem China Limited on Aug 3 last year.

The group’s losses relate mainly to the deemed one-off non-cash RTO expenses of approximately $9.6 million, the share-based payment to the sponsor and arranger of approximately $1.2 million in aggregate as well as the expenses incurred by the group relating to the RTO exercise of approximately $196,000.

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As a result, losses per share came in at 5.24 cents, as compared to earnings per share of 0.55 cents in FY2022.

Despite Lincotrade’s losses, revenue increased 78% y-o-y to $69.9 million, propelled by higher revenue contribution from the group’s commercial and showflats business segments, but partially offset by lower revenue contribution from the residential segment.

Revenue from commercial and showflats segments increased by approximately 58.7% and 357.3% respectively, mainly due to higher percentage of completion for some of the group’s larger commercial and showflats projects. Revenue from the residential segment declined by about 29.0%, as most residential projects on hand were substantially completed during FY2022.

In line with the increase in revenue, cost of sales increased by 81.1% y-o-y to $69.9 million. Hence, , Lincotrade’s gross profit increased by approximately 55.0% to about $7.3 million in FY2023.

However, the group’s gross profit margin dipped 1.5 percentage points (ppt) to 10.4% in FY2023 from 11.9% the previous year, mainly due to the higher proportion of revenue contribution from the showflats business segment, which registered lower gross margin in FY2023.

Excluding the one-off non-cash RTO expenses, Lincotrade has recorded an adjusted profit before tax of approximately $2.8 million for FY2023, representing a growth of 168.2% as compared to FY2022.

Cash and cash equivalents as at June 30 stood at around $12.7 million.

Lincotrade’s order book as at June 30 stands at approximately $58.0 million which will be fulfilled during the next two years.

With an aim to expand its order book with a healthy pipeline of new projects, the group continues to proactively tender for new projects in Singapore, particularly those that are larger in terms of scale and contract value. It has already secured an asset enhancement initiative (AEI) in January worth $35.0 million - its single largest contract - for an integrated development in Singapore.

The group did not declare any dividends for the final year ended June.

Commenting on its FY2023 results, managing director of Lincotrade, Tan Jit Meng said: “FY2023 marks a new milestone in Lincotrade’s history as we completed our RTO and transition into a listed company in our corporate journey. We look back on a strong first year of listing with good performance across the group, both operationally and financially, which reflects our core competencies in project management and execution.”

“With diversity in our business model that has three different business categories, Lincotrade

is well-positioned to continue our momentum of organic growth that aligns, and we aim to

supplement that growth with a disciplined financial approach. The positive outlook of Singapore’s construction market reaffirms Lincotrade’s positive trajectory and reinforces our belief in our ability to achieve a stronger growth profile ahead,” adds Tan.

As at 3:30pm, shares in Lincotrade are trading at 29 cents on Aug 30.

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