Siab Holdings Berhad (0241) recently shared their financial results for the first quarter of 2024. Here’s a breakdown of how the company performed.

Revenue and Gross Profit. For the first quarter of 2024, Siab Holdings Berhad made RM26.26 million in revenue. This is quite a drop from the RM36.84 million they made in the same period last year. The main reason for this decrease is that their ongoing construction projects didn’t progress as quickly as before​​.

However, despite the lower revenue, they managed to turn things around in terms of profit. They reported a gross profit of RM2.17 million, a big improvement from the gross loss of RM0.20 million reported in the first quarter of 2023. This means they are managing their costs better and becoming more efficient​​.

Profitability. The company made a small profit before tax (PBT) of RM0.11 this quarter, a significant improvement from the loss before tax of RM2.31 million in the same period last year. After taxes, their net profit (PAT) was also RM0.11 million, compared to a net loss (LAT) of RM2.33 million last year. This shift back to profitability shows they are managing their projects and costs much better​​.

Assets and Liabilities. As of 31 March 2024, Siab Holdings Berhad had total assets worth RM163.13 million, slightly down from RM168.10 million last year. Non-current assets (like property and equipment) stayed steady, but current assets (like cash and receivables) dipped a bit, mainly because they had less cash on hand, dropping from RM20.72 million to RM16.97 million​​.

Their total equity (the value of the company after all debts are paid) fell from RM52.11 million to RM43.60 million, largely because of accumulated losses. Liabilities (what the company owes) increased a bit, mostly due to higher trade and other payables​​.

Cash Flow. For the first quarter of 2024, the company’s cash flow from operations was a net outflow of RM1.04 million, better than the RM3.52 million outflow in the same period last year. This improvement comes from better management of their working capital. Investing activities brought in RM62,000, while financing activities led to a net outflow of RM2.63 million, mainly due to loan repayments​​.

Looking Ahead. The construction industry in Malaysia is projected to grow by 6.8% to RM60.49 billion in 2024. Siab Holdings Berhad has a solid order book worth RM314.48 million, which bodes well for future revenue. They plan to keep bidding for new projects and focus on managing costs and operational efficiency​​. Moreover, Siab had just recently acquired Taghill Sdn. Bhd., a construction company that would create significant synergy in construction projects uptake, which they also bring along RM1.1 billion in projects to Siab.

Conclusion

Siab Holdings Berhad’s first quarter of 2024 shows a company turning challenges into opportunities. They have managed to improve profitability despite lower revenues, thanks to better cost management and project execution. With a strong order book and a focus on efficiency, the company looks set to continue this positive trend. Also, there are rumours where a very significant property developer in Malaysia is buying into Siab. We may see more from this going forward.