Part 2 of this analysis takes a closer and in-depth look into Tat Hong’s business divisions, in terms of revenue performance, gross margin as well as proportion to total revenues. Take note though that FY 2010 is a year of the economic downturn and so the figures shown will probably be depressed and not reflecting normal economic conditions.

Business Unit Revenue Analysis


For 4Q 2010, crawler crane rental took up 32.2% of revenues, down from 34.9% a year back. The division also saw a 9.4% increase in revenues. The dip in proportional contribution can be attributed to higher equipment sales as enquiries increased post-crisis. Indeed, sale of cranes jumped 68% to S$50.2 million from S$29.7 million a year ago, and this division took up 38.3% of revenues for 4Q 2010, much higher than the 26.9% a year ago. Tower crane rentals also saw increased business year on year, as revenues increased 34% to S$8.5 million. Though this division only contributed 6.5% of total revenues for 4Q 2010, it is expected that with the new JV and business expansion which the Group is undertaking, this contribution is set to rise further in future periods. Spare parts and general equipment hire saw dips due to reasons as lined out in the financial statements announcement, but should see more pick up once the Australian side gets going with their economic boosting plans, amid progress on oil and gas projects picking up steam once again. Recall that Tat Hong owns 70% of Tutt Bryant which is their Australian subsidiary, and Tutt Bryant had also reported muted numbers as a result of the ongoing financial crisis. Read more…