KUALA LUMPUR (Oct 27): Genting Bhd chairman Tan Sri Lim Kok Thay's 28.49%-owned Grand Banks Yachts Ltd said on Thursday (Oct 27) the yacht manufacturer's business momentum is expected to accelerate after achieving an all-time high net order book value.

The manufacturer of luxury recreational motor yachts, whose manufacturing yard is located in Pasir Gudang, Johor, reported that its net order book swelled to a record high of S$191.8 million (about RM641.7 million) at the company’s first quarter ending Sept 30, 2022 (1QFY23).

Grand Bank Yachts had accomplished a net order book value of S$182.9 million for its financial year ending June 30, 2022 (FY22) compared with S$116.9 million a year earlier (FY21) and S$48.9 million in FY20.

"Barring unforeseen circumstances, business momentum is expected to accelerate, as the group plans to increase its headcount to accelerate the production schedule," the group said in its latest corporate presentation, which was filed with the Singapore Exchange on Thursday, in conjunction with the company's annual general meeting.

Based on its financial review, the group said there were 31 new boat orders recorded in FY22 and seven new boat orders recorded in 1QFY23.

The company added in its outlook that demand for luxury yachts will remain strong as the pandemic has raised the appeal of sailing.

“The group will continue to develop bigger, sleeker yachts with greater fuel efficiency,” it said.

Notably, Grand Banks Yachts debuted the Grand Banks 85 model in March 2022, its largest yacht to date.

Nonetheless, the group warned of possible higher operating costs in the near term amid increased costs of energy and raw materials as well as rising labour costs. It is also monitoring the impact of rising interest rates on customer sentiment.

According to Grand Banks Yachts’s 2022 annual report, Lim is the largest shareholder with 52,609,994 shares as on Sept 16, 2022. The second largest shareholder is Citibank Nominees Singapore Pte Ltd, which has a 21.56% stake in the group.

The company returned to the black in 1QFY23 with a net profit of S$1.1 million, from a net loss of S$4.2 million a year ago (1QFY22). The financial turnaround was supported by higher revenue of S$22.4 million in 1QFY23, which nearly doubled from the S$11.5 million in 1QFY22.

Grand Banks Yachts had struggled with lower revenue in FY22, amounting to S$75.2 million compared with S$96.1 million in FY21, as the group only had less than 10 months of production due to the movement control orders imposed by the Malaysian government to contain the spread of Covid-19.

Thankfully, the absence of lower-margin trade-in boat orders lifted the group’s gross profit margin to 26.6% in FY2022 from 21.5% a year ago, it said. Grand Banks Yachts recorded a net profit of S$4 million in FY22 compared with S$4.2 million in FY21.