The construction sector in Singapore saw worsening debt payment behaviour in the last quarter of 2018, with only 25 per cent of construction debt paid on time, compared with 36 per cent in the preceding quarter, according to a report by Experian’s DP Information Group (DP Info).
The report—which analysed the payment patterns of more than 120,000 companies in Singapore across the retail, wholesale, construction, hospitality, information and communications, manufacturing, services and transport sectors—found that the construction sector was the hardest hit with a significant increase in days turned cash (DTC) delinquent payments.
The percentage of delinquent debt over 90 days for the sector was at 35 per cent, nearly double the 18 per cent for the previous quarter.
Singapore’s construction sector has been weak in activities in recent years, due to lower-than-anticipated construction demand for both the private and public sectors. Despite an upturn of 23 per cent in construction demand in 2018, driven mainly by public sector projects, smaller local players are still expected to face challenges with their smaller profit margins.
Payment behaviour in other sectors has been largely stable towards the end of 2018, although some uncertainties in the business environment are expected to persist in 2019. — Construction+ Online
