39 Annual Report 2024 OPERATIONS AND FINANCIAL OVERVIEW TURNOVER In FY2024, revenue grew 18.8% year-on-year to S$861.2 million from S$725.1 million in the previous corresponding period (“FY2023”), mainly driven by the Electrification and Automation business segments. The Electrification business segment continues to lead the growth in revenue, growing 30.0% or S$100.2 million year-on-year to S$434.8 million in FY2024. This was mainly attributed to growth in the data centre, power, utility, and energy storage markets fuelled by rising demand for power distribution and electrical control systems in the USA and Australia/New Zealand region. The Automation business segment posted a revenue growth of 14.3% year-on-year or S$24.4 million, mainly attributed to higher revenue contributions from the Americas and Asia Pacific regions. EARNINGS In line with higher revenue, Group’s gross profit increased by S$41.3 million or 20.7% year-on-year to S$241.2 million. Group’s gross margin remained relatively stable at 28.0%, compared to 27.6% in FY2023. The Group’s operating expenses for FY2024 rose by 15.8% or S$25.5 million to S$187.0 million, mainly due to higher personnel costs of S$12.9 million, higher depreciation expenses of S$3.8 million, and increased professional fees and computer expenses of S$1.5 million. Despite the increase in operating expenses, the Group’s operating profit and EBITDA in FY2024 grew significantly by 41.3% and 29.1% year-on-year respectively, driven by improved operating leverage with growth in revenue. Interest expenses were 15.9% lower year-on-year, decreasing from S$10.7 million in FY2023 to S$9.0 million in FY2024, due to improvement in working capital management. As a result, the Group’s net profit for FY2024 increased by 63.2% to S$36.8 million from S$22.5 million in FY2023. The net profit margin increased by 1.2 percentage point (“pp”), from 3.1% to 4.3%. Including the exceptional item of US$8.0 million (S$10.4 million) arising from the arbitration settlement, the Group’s net profit after exceptional item in FY2024 grew by 16.9% to S$26.3 million. PERFORMANCE OF BUSINESS SEGMENTS On the back of the electrification megatrend, the Electrification business segment is the largest revenue contributor, contributing 50.5% of revenue. This is followed by the Communications business segment and Automation business segment that contributed 26.9% and 22.6% of revenue respectively. The acquisition of Carlton Staffing, RFC and Linked Group Services during the year have also contributed to revenue. Electrification revenue improved by 30.0% in FY2024 to S$434.8 million, mainly attributed to significant contributions from major contracts secured in FY2023 and new projects secured in FY2024. The segment’s EBITDA grew by 44.0%, rising from S$29.7 million in FY2023 to S$42.7 million in FY2024. This increase was due to higher revenue achieved with stable gross margins and hence, the EBITDA margin improved from 8.9% in FY2023 to 9.8% in FY2024. The Communications segment saw a modest revenue growth of 5.2%, increasing from S$220.5 million in FY2023 to S$232.0 million in FY2024. This growth was mainly driven by revenue contributions from newly acquired subsidiaries, which added S$7.2 million. Despite the revenue growth, the segment’s EBITDA decreased by 7.8% from S$27.8 million in FY2023 to S$25.6 million in FY2024. This decline was due to an unfavourable sales mix at lower gross margins for International Communications businesses. The Automation segment experienced revenue growth of 14.3%, increasing from S$170.0 million in FY2023 to S$194.4 million in FY2024. This growth was mainly due to higher revenue contributions from the Americas and Asia Pacific regions. The segment’s EBITDA improved significantly, increasing from S$6.2 million in FY2023 to S$13.8 million in FY2024. This improvement was mainly attributed to a favourable sales mix at higher gross margins and the absence of cost overruns incurred for some projects in FY2023. Hence, the EBITDA margin increased by 3.5 pp, from 3.6% in FY2023 to 7.1% in FY2024.
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