KSH reported that its 3QFY17 PATMI decreased 34% YoY to S$9.1m mainly due to lower contributions from the construction segment and weaker share of results of associates over the quarter, partially offset by higher share of results from joint ventures which saw a profit boost from High Park Residences.

In terms of the topline, revenues over the quarter similarly decreased 35% to S$34.5m due to weaker construction numbers. We deem this set of results to be broadly within expectations and note that the group’s order book stands at a reasonably healthy S$225m.

KSH continues to enjoy a robust balance sheet with cash equivalents of S$148.9m and is in a net cash position.

Management indicates that they are on the lookout for opportunities to replenish their land-bank and will also work closely with its overseas partners to uncover yield-accretive projects and developments. Maintain BUY with an unchanged fair value estimate of S$0.61.

Source: OCBC Research - 13 Feb 2017