[Credit Update] Koh Brothers: Improved FY25 Credit Metrics

 |   14 May 2026  |    6 views

Company at a Glance

What the company does:

Koh Brothers Group Ltd is a Singapore-listed group mainly involved in engineering & construction, building materials, bio-refinery and renewable energy (via Oiltek), real estate, and hospitality. Its core business is engineering & construction through Koh Brothers Eco Engineering and Koh Brothers Building & Civil Engineering Contractor, which undertakes civil infrastructure, water treatment, tunnelling and public-sector building projects in Singapore. Major ongoing projects include Changi Airport Terminal 5 intra-terminal tunnels, the Lorong Halus Bus Depot, and the Tuas Water Reclamation Plant.


Main income source:

KBGL’s income is primarily from Construction & Building Materials. In FY25, this segment generated S$321.0mn revenue out of total group revenue of S$329.4mn (97.4% of group revenue).


What Supports the Credit Profile

FY25 profit turned around mainly due to stronger core construction performance, supported by one-off disposal gains.

Revenue rose 38.2% YoY to S$329.4mn, while gross profit more than doubled 103% YoY to S$39.1mn, with gross margin improving to 11.9% from 8.1%. FY25 margin recovery likely reflects improved project execution and project mix relative to prior years, after FY23 profitability was pressured by prolonged construction periods and elevated material, manpower and subcontractor costs. In addition, reported profitability was further supported by higher other gains of S$14.0mn (FY24: S$3.4mn), largely due to a one-off land disposal gain in Johor.

FactsheetsSource: Koh Brothers Presentation Slides


Changi T5 and Lorong Halus are now the main backlog drivers

FY25 construction order book rose to S$1.126bn (+35.8% YoY), driven increasingly by new large-scale projects. Key projects include the S$999.1mn Changi Airport T5 intra-terminal tunnel (2.3% complete) and the S$313.9mn Lorong Halus Bus Depot (2.9% complete), which should provide stronger medium-term revenue visibility.


Credit metrics strengthened

Net gearing declined from 0.54x in FY23 to 0.09x in FY25, while net debt / EBITDA improved significantly from 7.09x in FY24 to 0.56x in FY25 as EBITDA recovered and net debt reduced. Interest coverage also strengthened to 5.22x from near-breakeven levels, indicating operating earnings are now far better positioned to support debt obligations.


Main Areas to Monitor:

1) FY25 profitability improved sharply, but part of the earnings was supported by non-core gains including land disposal. The key forward question is whether core construction margins can sustain earnings as one-off gains fade.


Financial Position

FactsheetsSource: Koh Brothers Presentation Slides


Koh Brothers SGD Bond Opportunities

Factsheets* YTM/YTC shown are indicative only and subject to market conditions, price fluctuations, and final trade execution. For bond pricing, further information, and available offerings, please contact bonds@phillip.com.sg


Our Credit View

Koh Brothers’ credit profile improved in FY25, supported by stronger construction execution and stronger credit metrics. However, key watchpoints remain the sustainability of core earnings beyond one-off gains.


Related Articles

[Credit Update] Seatrium Ltd: Post-Merger Recovery Strengthens

Seatrium is an engineering, procurement and construction (EPC) contractor for offshore energy infrastructure.

 |   14 May 2026

[Credit Update] Global Resource Construction Ltd (GRC Group): Scale Expansion Through Acquisition with Visible Order Book Support

Global Resource Construction Ltd. is a Singapore-based, construction-led group spanning building construction, civil infrastructure, environmental engineering, prefabrication and procurement.

 |   08 May 2026

[Credit Update] Perennial Holdings: Strong Healthcare-Led Growth Amid Tight Debt Servicing Capacity

Perennial Holdings (PREHSP) is a Singapore-based real estate and healthcare platform with operations across China, Singapore, Malaysia, and Ghana, with China remaining its core market.

 |   08 May 2026

Recent Articles

[Credit Update] Seatrium Ltd: Post-Merger Recovery Strengthens

Seatrium is an engineering, procurement and construction (EPC) contractor for offshore energy infrastructure.

 |   14 May 2026

[Credit Update] Global Resource Construction Ltd (GRC Group): Scale Expansion Through Acquisition with Visible Order Book Support

Global Resource Construction Ltd. is a Singapore-based, construction-led group spanning building construction, civil infrastructure, environmental engineering, prefabrication and procurement.

 |   08 May 2026

[Credit Update] Perennial Holdings: Strong Healthcare-Led Growth Amid Tight Debt Servicing Capacity

Perennial Holdings (PREHSP) is a Singapore-based real estate and healthcare platform with operations across China, Singapore, Malaysia, and Ghana, with China remaining its core market.

 |   08 May 2026

Disclaimers

These commentaries are intended for general circulation. It does not have regard to the specific investment objectives, financial situation and particular needs of any person who may receive this document. Accordingly, no warranty whatsoever is given and no liability whatsoever is accepted for any loss arising whether directly or indirectly as a result of any person acting based on this information. Opinions expressed in these commentaries are subject to change without notice. Investments are subject to investment risks including the possible loss of the principal amount invested. The value of the units and the income from them may fall as well as rise. Past performance figures as well as any projection or forecast used in these commentaries are not necessarily indicative of future or likely performance. Phillip Securities Pte Ltd (PSPL), its directors, connected persons or employees may from time to time have an interest in the financial instruments mentioned in these commentaries. Investors may wish to seek advice from a financial adviser before investing. In the event that investors choose not to seek advice from a financial adviser, they should consider whether the investment is suitable for them.

The information contained in these commentaries has been obtained from public sources which PSPL has no reason to believe are unreliable and any analysis, forecasts, projections, expectations and opinions (collectively the "Research") contained in these commentaries are based on such information and are expressions of belief only. PSPL has not verified this information and no representation or warranty, express or implied, is made that such information or Research is accurate, complete or verified or should be relied upon as such. Any such information or Research contained in these commentaries are subject to change, and PSPL shall not have any responsibility to maintain the information or Research made available or to supply any corrections, updates or releases in connection therewith. In no event will PSPL be liable for any special, indirect, incidental or consequential damages which may be incurred from the use of the information or Research made available, even if it has been advised of the possibility of such damages. The companies and their employees mentioned in these commentaries cannot be held liable for any errors, inaccuracies and/or omissions howsoever caused. Any opinion or advice herein is made on a general basis and is subject to change without notice. The information provided in these commentaries may contain optimistic statements regarding future events or future financial performance of countries, markets or companies. You must make your own financial assessment of the relevance, accuracy and adequacy of the information provided in these commentaries.

Views and any strategies described in these commentaries may not be suitable for all investors. Opinions expressed herein may differ from the opinions expressed by other units of PSPL or its connected persons and associates. Any reference to or discussion of investment products or commodities in these commentaries is purely for illustrative purposes only and must not be construed as a recommendation, an offer or solicitation for the subscription, purchase or sale of the investment products or commodities mentioned.

IMPORTANT INFORMATION

This material is provided by Phillip Capital Management (S) Ltd (“PCM”) for general information only and does not constitute a recommendation, an offer to sell, or a solicitation of any offer to invest in any of the exchange-traded fund (“ETF”) or the unit trust (“Products”) mentioned herein. It does not have any regard to your specific investment objectives, financial situation and any of your particular needs. You should read the Prospectus and the accompanying Product Highlights Sheet (“PHS”) for key features, key risks and other important information of the Products and obtain advice from a financial adviser (“FA“) pursuant to a separate engagement before making a commitment to invest in the Products. In the event that you choose not to obtain advice from a FA, you should assess whether the Products are suitable for you before proceeding to invest. A copy of the Prospectus and PHS are available from PCM, any of its Participating Dealers (“PDs“) for the ETF, or any of its authorised distributors for the unit trust managed by PCM.  

An ETF is not like a typical unit trust as the units of the ETF (the “Units“) are to be listed and traded like any share on the Singapore Exchange Securities Trading Limited (“SGX-ST”). Listing on the SGX-ST does not guarantee a liquid market for the Units which may be traded at prices above or below its NAV or may be suspended or delisted. Investors may buy or sell the Units on SGX-ST when it is listed. Investors cannot create or redeem Units directly with PCM and have no rights to request PCM to redeem or purchase their Units. Creation and redemption of Units are through PDs if investors are clients of the PDs, who have no obligation to agree to create or redeem Units on behalf of any investor and may impose terms and conditions in connection with such creation or redemption orders. Please refer to the Prospectus of the ETF for more details.  

Investments are subject to investment risks including the possible loss of the principal amount invested. The purchase of a unit in a fund is not the same as placing your money on deposit with a bank or deposit-taking company. There is no guarantee as to the amount of capital invested or return received. The value of the units and the income accruing to the units may fall or rise. Past performance is not necessarily indicative of the future or likely performance of the Products. There can be no assurance that investment objectives will be achieved.  

Where applicable, fund(s) may invest in financial derivatives and/or participate in securities lending and repurchase transactions for the purpose of hedging and/or efficient portfolio management, subject to the relevant regulatory requirements. PCM reserves the discretion to determine if currency exposure should be hedged actively, passively or not at all, in the best interest of the Products.  

The regular dividend distributions, out of either income and/or capital, are not guaranteed and subject to PCM’s discretion. Past payout yields and payments do not represent future payout yields and payments. Such dividend distributions will reduce the available capital for reinvestment and may result in an immediate decrease in the net asset value (“NAV”) of the Products. Please refer to <www.phillipfunds.com> for more information in relation to the dividend distributions.  

The information provided herein may be obtained or compiled from public and/or third party sources that PCM has no reason to believe are unreliable. Any opinion or view herein is an expression of belief of the individual author or the indicated source (as applicable) only. PCM makes no representation or warranty that such information is accurate, complete, verified or should be relied upon as such. The information does not constitute, and should not be used as a substitute for tax, legal or investment advice.  

The information herein are not for any person in any jurisdiction or country where such distribution or availability for use would contravene any applicable law or regulation or would subject PCM to any registration or licensing requirement in such jurisdiction or country. The Products is not offered to U.S. Persons. PhillipCapital Group of Companies, including PCM, their affiliates and/or their officers, directors and/or employees may own or have positions in the Products. Any member of the PhillipCapital Group of Companies may have acted upon or used the information, analyses and opinions herein before they have been published. 

This advertisement has not been reviewed by the Monetary Authority of Singapore.  

 

Phillip Capital Management (S) Ltd (Co. Reg. No. 199905233W)  
250 North Bridge Road #06-00, Raffles City Tower ,Singapore 179101 
Tel: (65) 6230 8133 Fax: (65) 65383066 www.phillipfunds.com

?>