26.05.2011

Tat Hong up 18%

Singapore based crane and equipment sales and rental company Tat Hong has reported an 18 percent rise in revenues for its full year, while profits fell 30 percent.

Revenues for the 12 months to the end of March were $584.2 million 18 percent higher than last year, at the same time pre-tax profits fell 30 percent to $40.6 million.

The company is made up of four divisions – Distribution is the largest and posted sales of $272.4 million, an increase of 22 percent on the prior year, thanks to higher excavator sales in Singapore, Indonesia and Vietnam- Australia was flat after a strong start to the year.

Mobile (wheeled and crawler) crane rental is the second largest sector, but represents almost half of the groups profits. Revenues climbed 12 percent to $184.9 million, thanks to strong improvements in Australia and Hong Kong weighed down by falls in Singapore and Malaysia.

General rental, which includes aerial lifts and telehandlers, fell three percent to $69.7 million due to a poor start to the year, a strong upturn in Australia saw the fourth quarter improve 12 percent.

Finally tower crane revenues leapt 70 percent to $57.2 million thanks mostly to acquisitions and fleet expansions the company made in China through Beijing Tat Hong Zhaomao Equipment Rental, Sichuan Tat Hong Yuan Zheng Machinery and China Nuclear Huaxing Tathong Machinery. Rapidly rising costs in China and heavy completion also depressed profits within the tower crane division.

Tat Hong chief executive Roland Ng said: “As earlier predicted, our last quarter was a bumpy journey as we faced spill over effects from the Australia flood in the second half. Despite our top line improvement and better performance from three out of our four core business segments, net profit attributable to shareholders was mainly impacted by staff costs and other non-operating costs. The group’s operational bottom line is still growing, evidenced by the 11.7 percent increase in operational net profit with the exclusion of one-off items.

“Looking ahead, our Crane Rental division should continue to perform well, in line with improved sentiments from some of our key regional markets and Australia. Although our distribution division has sustained its growth momentum throughout FY2011, we maintain our cautious outlook in view of possible delays in order deliveries stemming from the Japan tsunami disaster. We remain hopeful of a brighter outlook in 2012 should market conditions remain unaffected by any sudden adverse natural or economic occurrences.