Boustead Singapore 2025 AGM: Record Profits, Special Dividend, and Strategic Moves Set to Reshape the Group

Key Highlights from Boustead Singapore Limited’s 2025 Annual General Meeting

Boustead Singapore Limited’s (SGX:F9D) Annual General Meeting (AGM), held on July 25, 2025, delivered a trove of critical updates that could significantly impact shareholder value and the Group’s future trajectory. Here’s a comprehensive breakdown of the key announcements, financial results, and strategic developments that retail investors need to know.

1. Financial Performance: Record Profits, Cash Position and Special Dividend

• Revenue: Declined in FY2025, mainly due to lower order backlogs in the Real Estate Solutions and Energy Engineering divisions, but was partly offset by higher revenue from Geospatial and Healthcare.
• Net Profit: Improved, driven by higher gross margins and a significant one-off gain from transferring the fund management business to Unified Industrial (UIB).
• Cash Position: The Group remains highly cash-rich, with a net cash position of S\$326 million after paying S\$78 million to acquire Boustead Projects shares from non-controlling shareholders.
• Total Dividend: Board proposed a final dividend of 4.0 cents per share and a special dividend of 2.0 cents per share, in addition to an interim dividend of 1.5 cents already paid, bringing the total to 7.5 cents per share for FY2025.
• Earnings Per Share: Rose to 19.6 cents from 13.4 cents in FY2024.
• Return on Equity: Increased to 16% from 13%.
• Engineering Orders: Rose to S\$377 million, the second highest in five years.

Investor Takeaway: A special dividend, significant cash reserves, and improved profitability signal strong shareholder returns and confidence from the Board.

2. Divisional Performance & Strategic Updates

Energy Engineering Division

• Revenue and operating profit declined in FY2025 due to a poor order intake the previous year, but new orders—especially a large ethylene cracker project in the U.S.—have improved the outlook.
• Order book is healthier for the next year, but margins are under pressure due to lower-margin contracts.
• Long-term demand for heat transfer equipment is expected to rise due to global underinvestment in hydrocarbons and ongoing energy needs for sectors that cannot be electrified.
• Strategic focus remains on sales, new product development (e.g., reformers), lean project execution, and building aftermarket capabilities. Critically, management vows not to bid for projects with razor-thin margins or high risk.

Geospatial Division

• Largest revenue contributor (42% of Group revenue) with modest growth (4%) but record operating profit due to a high mix of high-margin products and improved managed services.
• Facing near-term headwinds from government budget constraints and currency translation losses, but long-term prospects are strong due to GIS technology becoming mainstream and growing integration needs.
• Plans to invest in upskilling staff and expanding the partner ecosystem to address these opportunities.
• Notably, a partnership with Deloitte on GISflow for government agencies demonstrates the division’s innovation edge.

Real Estate Solutions Division

• Order backlog from pre-pandemic years has been cleared; focus has shifted to replenishing the order book amid fierce competition and unstable project pipelines.
• Over 50% of new contracts in FY2025 were secured outside Singapore, notably in Malaysia (data centre project).
• Strategic merger of fund management with UIB created a new industrial platform with US\$3.5 billion in AUM, providing diversification, expanded capital access, and potential new exit strategies for stabilised assets (including possible REIT listing).
• One-off profit from transferring fund management to UIB, but profit was dragged down by a S\$7 million JTC penalty (now being appealed after a replacement anchor tenant was secured).
• Management is exploring options for the COMO Orchard Hotel, including sale or syndication, but no deal has materialised.

Healthcare Division

• Revenues grew, led by BMEC’s Southeast Asian operations, but the division posted a S\$1.3 million operating loss due to a S\$2.0 million loss from Beijing Pukang, its Chinese associate.
• Core BMEC business returned to profitability, with strong demand for rehabilitation and aging care solutions, especially in Southeast Asia.
• Key growth drivers: Wound Care Solutions (notably, supplying Sengkang General Hospital); Sports Science & Rehab business (hydrotherapy pools, national sports initiatives); smart solutions with AI and robotics (e.g., AI-enhanced EksoNR exoskeleton).
• Beijing Pukang is localising offerings in China in response to tighter regulations and is targeting a turnaround with new product launches and clinical partnerships.
• Healthcare is highlighted as a long-term “sunrise sector” with demographic tailwinds.

3. Strategic Corporate Developments & Shareholder Questions

• Unified Industrial (UIB) Platform: Boustead Projects owns 20.1% of UIB and has minority but critical rights over business decisions; future REIT listing is an option, with Boustead Projects able to inject stabilised assets for capital recycling.
• COMO Orchard Hotel: Management plans to stabilise and eventually syndicate or sell this non-core asset.
• Geospatial Division IPO: Management does not see the business as mature enough for a public listing and notes that Esri Inc. consent would be required. Main barriers are market awareness and talent retention.
• Dividend Policy: No fixed payout ratio due to lumpy project-based revenues in key divisions, but the Group strives to pay up to 50% of net profit and has a strong dividend track record; higher dividends in FY2025 are due to strong cash position and capital recycling plans.
• Potential for Corporate Social Responsibility: While there is interest, the Board emphasised its primary duty is to shareholders, so large-scale philanthropic projects are not on the near-term horizon.

4. Resolutions and Voting Results

• All resolutions, including adoption of financial statements, dividends, director re-elections, auditor reappointment, share issue authority, share buy-back mandate, and scrip dividend scheme, were overwhelmingly approved by shareholders (most above 99% in favour).
• Notably, special and final dividends were both approved—representing a substantial payout for shareholders in FY2025.

5. Price-Sensitive & Shareholder-Relevant Insights

• Special Dividend & High Total Payout: Unusually high payout for FY2025 could drive share price re-rating.
• Potential REIT Listing: Board is reviewing strategic options for UIB, including a REIT, which could unlock value from stabilised industrial assets.
• Strong Cash Position: Net cash of S\$326 million provides a buffer for future investment, M&A, or further capital returns.
• Turnaround in Healthcare and New Orders in Key Divisions: Indicate improving fundamentals, though margin pressure is a risk.
• One-off Penalty Provision: Impacted FY2025 profit, but management is seeking a waiver after securing a replacement tenant.

Investor Watch: The combination of a special dividend, a robust cash position, strategic asset recycling (REIT potential), and improving performance in core divisions present potential catalysts for Boustead Singapore’s share price in the coming quarters. Investors should monitor further announcements regarding the UIB platform and the outcome of the JTC penalty waiver.

Disclaimer: This article is for informational purposes only and does not constitute investment advice or a recommendation to buy or sell any securities. Readers should conduct their own research or consult a professional advisor before making investment decisions.

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