Hong Leong Asia posts 56% jump in full-year profit on strong China operations

Hong Leong Asia’s foray into China is paying off for the company.

Its China operations and building materials unit both helped to boost its full-year net profit to S$95.4 million, up 56 percent on year.

Revenue rose 30 percent to S$3.2 billion.

Hong Long’s share of profit from associates increased to S$25.4 million in 2007, a turnaround from the loss in 2006 of S$500,000.

Most of the contribution come from its Malaysian associate Tasek Corporation.

As at 31 December 2007, the group’s net gearing ratio was 21 percent as compared to 17 percent of the previous year due to higher borrowings in the China operations.

On its outlook, Hong Leong says it expects to remain profitable, barring unforeseen circumstances.

It is citing the expected economic growth rate in China of about 8 percent to 10 percent and the continuing growth momentum of property development and construction sectors in Singapore.

Hong Leong’s building materials unit is expected to benefit from strong demand for ready-mixed concrete from the construction industry. – CNA/ch

Source : Channel NewsAsia – 28 Feb 2008

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