Lincotrade & Associates Holdings Limited: 6M2026 Financial Analysis and Investor Insights

Lincotrade & Associates Holdings Limited has released its unaudited condensed interim financial statements for the six months ended 31 December 2025 (referred to as 6M2026). This analysis reviews the Group’s financial performance, dividend announcement, and corporate developments to provide clarity for investors and market watchers.

Key Financial Metrics and Performance Summary

*The previous half-year (Jan-Jun 2025) is not disclosed; only 6M2025 (Jul-Dec 2024) is available for YoY comparison.

Key Drivers Behind Financial Performance

• Revenue: Rose by 58.2% YoY, mainly due to significant increases in the commercial (+66.0%, S\$19.1m) and residential (+166.0%, S\$2.9m) segments, attributable to higher work completion rates on ongoing projects. The showflat segment declined due to intensified competition.
• Gross Profit & Margin: Gross profit nearly doubled (+94%), and gross margin improved from 12.2% to 15.0% due to higher-margin commercial projects and better cost controls, especially at the PRC subsidiary.
• Net Profit: Surged by 400.6% YoY, reflecting strong operational leverage, higher revenue, and margin expansion.
• EPS: Increased by 428.6% YoY, aligned with the surge in profitability and a slight increase in share base from a placement.
• Dividend: The Board declared an interim, tax-exempt cash dividend of 0.88 Singapore cents per share (S\$0.0088), compared to nil in the prior year. The dividend will be paid on 30 March 2026, with a record date of 19 March 2026.

Balance Sheet and Cash Flow Highlights

• Net Asset Value (NAV): Increased to 9.47 cents per share from 7.21 cents, reflecting the strong profit and new capital from the share placement.
• Cash & Cash Equivalents: Rose by S\$3.2m during the period, ending at S\$11.4m, mainly due to net cash from financing activities (share placement and bank facilities), partially offset by investments in plant, equipment, and an associate.
• Contract Assets: Increased due to lower billings on ongoing projects, suggesting a robust pipeline but also a timing difference in cash conversion.
• Debt and Leverage: The Group’s borrowings increased (total financial liabilities rose to S\$23.3m), with bills payable and revolving credit facilities utilized to support working capital and asset purchases.

Corporate Actions and Strategic Developments

• Share Placement: On 2 December 2025, 10 million new ordinary shares were issued at S\$0.22 each, raising S\$2.1m in gross proceeds. The placement increased the share base to 182,027,726 shares.
• Investment in Linc Venture: The Group acquired a 30% stake in Linc Venture, a Malaysian property development and investment holding company. Linc Venture secured land in Kuala Lumpur for a residential project, with launch expected in 1H2026 and completion in 2029.
• Tuas Factory Expansion: The Group is finalizing additions and alterations to its new factory, including a 204-bed dormitory, expected to reduce worker accommodation costs and provide potential rental income. A lease extension to March 2026 for its existing premises has been obtained to facilitate the transition.
• Dividend Policy: A significant interim dividend was declared, reflecting confidence in the Group’s cash flow and earnings visibility.

Exceptional Items and Related Party Transactions

• Exceptional Expenses: The only notable exceptional item was a S\$13,000 loss on disposal of plant and equipment. There were no large one-off gains or losses.
• Related Party Transactions: Minor motor vehicle expenses (S\$74,000) were incurred with related parties, on agreed terms.

Industry Trends and Outlook

Singapore’s Building and Construction Authority projects total construction demand to remain robust, between S\$47–53 billion in 2026. The Group’s order book stood at S\$117.2 million as of 31 December 2025, to be fulfilled over the next two years. Management remains positive but cautious, citing inflationary pressures, rising labor and material costs, geopolitical uncertainties, and stricter foreign worker policies as risks. The Group’s expansion (Tuas Factory, investment in Linc Venture) positions it for longer-term growth, but close attention to cost control and project execution will remain critical.

Chairman’s Statement

The statement’s tone is confident, reflecting strong performance and prudent expansion:

We, Tan Kok Heng and Soh Loong Chow Jackie, being the directors of the Company, do hereby confirm on behalf of the Board that, to the best of our knowledge, nothing has come to the attention of the Board which may render the unaudited financial results for the 6-month period ended 31 December 2025 set out above to be false or misleading in any material aspect.

Conclusion and Recommendation

Overall, Lincotrade & Associates delivered a strong set of results for 6M2026. The Group achieved record revenue, margin expansion, and profit, supported by a healthy order book and a robust construction sector outlook. The interim dividend signals management’s confidence in cash flows and project pipeline. The main risks are rising costs and execution on large ongoing projects and new ventures.

• If you are currently holding the stock: The outlook remains positive, with strong earnings momentum, a solid order book, and prudent capital management. Consider holding your position, but monitor cost pressures and project execution risks, especially as the Group expands into new areas (property development, Tuas Factory utilization).
• If you are not holding the stock: The recent financial performance and sector outlook make Lincotrade an attractive candidate for further research. Potential investors may consider accumulating on pullbacks, particularly if the Group continues to demonstrate cost control and successful execution of its expansion initiatives.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. All investment decisions should be based on individual risk tolerance, research, and consultation with a licensed financial adviser. The author is not responsible for any losses arising from actions taken based on the above analysis.

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