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Tuesday, September 01, 2009

Koh Brothers business model fundamentally strong

I myself have invested in Koh Brothers because in my opinion, the company is seen by the government as a trusted partner. One of the many projects other than those for HDB is in fact for the coming Marina Integrated Resort. If I remember correctly, Koh Brothers was mentioned in this year's National Day Rally by PM Lee Hsien Loong. I foresee more big projects from the government.

Stay invested!

Koh Brothers wins $58.9m HDB contract
Business Times - 01 Sep 2009
Firm will pursue public infrastructure and govt building contracts, says CEO


CONSTRUCTION company Koh Brothers Group has clinched a $58.9 million contract from the Housing and Development Board (HDB) to build the second part of Punggol Waterway - a 4.2km waterway that will be connected to Sungei Punggol.

In January, Koh Brothers won a $144.6 million contract from the HDB for the construction of the first part of the waterway.

The latest contract brings Koh Brothers' order book to more than $579 million.

Construction of the second part of the waterway is set to start this month and is expected to be completed by the end of next year. Other ancillary works are expected to be completed by the fourth quarter of 2011.

The latest deal is not expected to have a positive material impact on the group's financial performance for the year ending Dec 31, 2009.

Chief executive Francis Koh said that the company will continue to pursue public infrastructure and government building projects over private construction projects.

'Our past record shows that public projects carry more certainty in terms of payment compared with private projects,' said Mr Koh.

Koh Brothers announced last month that net profit surged to $4.4 million in the first half of the year ended June 30, 2009, from $0.5 million for the corresponding period a year earlier. The improvement was on the back of a 17 per cent increase in revenue to $138.6 million.

The group attributed the higher revenue to the good performance of its construction and real estate divisions.

A construction, property development and specialist engineering solutions provider, Koh Brothers now has 'more than 40 subsidiaries, joint-venture and associated companies spread over Singapore, China, Indonesia, Malaysia and Vietnam'.

Koh Brothers shares closed down 1.8 per cent yesterday at 27 cents.

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