KUALA LUMPUR (Feb 28): Kelington Group Bhd posted a record-high profit for the fourth quarter ended Dec 31, 2023 (4QFY2023) as its gross profit margin rose to 18% from 12% a year ago due to shifts in revenue composition and favourable project mix.

Net profit surged by 96.5% to RM35.73 million from RM18.19 million in 4QFY2022, its bourse filing on Wednesday showed. Its quarterly revenue increased by 12.1% to RM478.26 million from RM426.72 million.

It declared a dividend of 2.5 sen per share for the quarter under review, taking the total dividends declared to four sen in FY2023, compared with 2.5 sen in FY2022.

On a segmental basis, Kelington's process engineering division experienced a significant increase of 142% in revenue to RM32.4 million due to a project awarded in 2022.

Revenue for its industrial gases division surged by 51% to RM30.9 million owing to consistent demand for liquid carbon dioxide from both local and export markets.

Its general contracting division also posted a significant increase in revenue of 30% to RM127.2 million due to the positive operating conditions in Singapore.

For the full year, the group’s net profit jumped by 84.1% to RM102.65 million from RM55.75 million, while revenue increased by 26.2% to RM1.61 billion from RM1.28 billion. Its gearing ratio was also reduced to 0.56 times from 1.01 times due to debt repayments in Malaysia and Singapore and the proactive utilisation of working capital.

Looking ahead, the group’s chief executive officer Raymond Gan said the group is well-positioned for continuous growth with several key developments.

He said the group had secured new contracts totalling RM1.1 billion in 2023, bringing the total order book to RM2.8 billion, of which RM1.3 billion remains outstanding. In addition, the group also bagged a major contract of RM143 million in January 2024 to perform the construction and commissioning of a gas hookup system in Shanghai, China.

“The industrial gas division's outlook remains positive as our second liquid carbon dioxide (LCO2) plant in Kerteh is scheduled to commence operation in the first quarter of 2024. This will more than double our production capacity and meet the increasing demand for LCO2 from export markets.

“Additionally, the commencement of our second on-site gas supply scheme in 2QFY2024, providing hydrogen, nitrogen, and oxygen to an optoelectronics semiconductor giant in Kulim, Kedah, will further strengthen the group's earnings visibility over the next 10 years,” he added in a statement.

At Wednesday’s market close, the counter was lower six sen or 2.43% at RM2.41, valuing the group at RM1.57 billion.

The group's shares have rallied since November last year, hitting a three-year high of RM2.47 on Tuesday (Feb 27). The counter has risen 23 sen or 10.6% since the start of 2024 and gained 90 sen or 59.6% over the past year.