| • From day one, the entire range of ISOTeam's business has required lots of labour doing work that induces lots of perspiration and expends lots of physical energy. A chunk of that work is about to be assigned to drones. • Autonomous drones will buzz up and down HDB or private building facades and structures, spraying paint or carrying out inspection work which will require AI and video analytics . Dozens of workers per block will no longer be required -- and ditto for scaffolding, which is just as costly an expense.  Photos: Company• ISOTeam has plenty of work left that needs hands and legs -- landscaping and greenery projects, upgrading of hawker centres, etc. ISOTeam has a long track record of doing work primarily for the HDB and town councils and other public sector agencies. • Read more about the company in the SGX Research article below featuring ISOTeam's CEO .... |
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A firm can harness tech tools to boost efficiency, but also needs a dedicated, trained workforce to flourish, says Anthony Koh, CEO of building maintenance and upgrading specialist ISOTeam. For people who live in Housing Development Board (HDB) flats in Singapore, drones may soon become a common sight. ISOTeam, which specialises in maintaining and upgrading buildings, has been using drones for façade inspections since 2021. The company is also exploring ways to deploy drone technology in other areas of its operations. |
After several iterations, ISOTeam expects to have a prototype ready for testing by the end of 2024.
“Using AI-empowered drones for painting will not only be safer and more environmentally-friendly, but also require less equipment and labour. Ultimately, this will allow our firm to improve our efficiency in terms of time and cost across our repair and redecoration operations,” Koh says.
He adds that, with the drones and other technologies, the company can take on more work in Singapore’s expanding market. “Unlike demand for construction, which fluctuates, the need to maintain and upgrade buildings is everlasting, especially in Singapore where buildings that are painted must be repainted at least once every five years and have its façade inspected every seven years.”
“The market for maintenance and upgrading is also growing every year, because even if Singapore is not adding new buildings to its urban landscape, there are more buildings that are getting older each year and need some work. That’s the beauty of being in our sector, compared to construction.”
Making staff a priority too
As ISOTeam incorporates drones and other technologies in its operations, it is upskilling staff to keep pace with the advancements. Koh elaborates: “To me, there’s no firm or organisation that can go on by itself without its people. I believe in investing in our people, and our company culture is all about sharing and upgrading ourselves.”
| “The market for maintenance and upgrading is also growing every year, because even if Singapore is not adding new buildings to its urban landscape, there are more buildings that are getting older each year and need some work. That’s the beauty of being in our sector, compared to construction.” -- CEO Anthony Koh |
“Although it does take time and money to train staff, it’s worth it. When our employees are equipped with new skills, we can deploy them to various business segments and divisions, giving us more flexibility. They can also find more opportunities for career progression in our many business units, so it benefits everyone.”
He highlights one of the company’s group general managers, who climbed the ranks from site supervisor to project manager to project director before taking on his current role, where he heads two business units. “There are many potential career paths for staff. In fact, most of our senior management have been with the firm for 15 to 20 years.”
If the employees eventually leave the firm, the effort spent on their professional development can pay off in other ways. Koh explains: “They leave us on very good terms, and some of them end up starting their own businesses and becoming our suppliers and subcontractors. In this way, we get more vendors that support us too.”
Even during the Covid-19 pandemic, when the company’s projects ground to a halt, it did not retrench a single worker, and paid its staff their full salaries. He says: “Some people said I was stupid and should have shut the firm temporarily, but I disagreed. It wouldn’t have been fair to the workers, who helped grow the business, when the pandemic was not their fault.”
ISOTeam’s loyalty to its employees through the pandemic has strengthened reciprocal bonds, with many of them telling Koh that they will work even harder for the firm. “In the end, every organisation depends on the people in it, so you should take good care of your staff,” he advises.
Giving back and going overseas
|
Stock price |
3.7 c |
|
52-week range |
3.3 – 7.3c |
|
Market cap |
S$23 m |
|
P/B |
0.6 x |
|
ROE |
5.8% |
|
PE ratio |
9.7 |
|
Dividend yield |
-- |
|
Source: SGX |
|
Koh adds that his guiding philosophy in business is a Chinese proverb that translates to ‘when you drink water, think of the source’, and encourages people to remember and be appreciative of those who support them. “I came from a very humble family and this was one of the many things that my father taught me.”
Another lesson was to share blessings and give back to society. ISOTeam does so by painting the homes of about 150 disadvantaged families each year free of charge, with staff making a day of it by bringing their children along, to join them in tidying up and cleaning the homes, among other tasks.
In keeping with this spirit of giving back, ISOTeam announced its intention to not only resume dividend payment but to raise its dividend policy from 20% to at least 25% of net profit after tax for FY2024 and at least 30% for FY2025. This was intended to thank shareholders for their support during the Covid-19 years when the company was unable to pay dividends as its performance was badly affected.
| Moving forward, Koh believes that the company, which has completed more than 860 projects involving over 7,200 buildings in Singapore since it was founded in 1998, will keep going from strength to strength. In December 2022, the company conducted a strategic business review, which led to the divestment of non-core segments and a renewed focus on its bread-and-butter Addition and Alteration, as well as Repairs and Redecoration capabilities. The move enabled ISOTeam to make a strong comeback as its order book recovered to pre-Covid 19 levels with better margins across all new contracts secured. As at 31 December 2023, ISOTeam’s order book stood at S$182.4 million. “At the same time, we are looking at potential regional opportunities in Southeast Asia where many of our workers are from. We see that many of our skills sets are needed and would be useful in those countries too,” he notes. “However, we lack local knowledge and so we are actively looking for partners who can contribute their knowledge and expertise about those markets’ business environment and policies. We want to make sure that we are fully informed and prepared before we go into those markets.” Collaborating with other local firms in the same sector to tackle larger projects is a possibility too. As Koh puts it: “The maintenance and upgrading segment is big enough for every industry player to have a decent slice of the pie without having to engage in price wars that are detrimental to all of us. Instead, we should work together to enhance professionalism and join forces to secure more business and upgrade the sector together. I think that’s more important as it will raise the profile of our industry in the long run, which will then help in attracting and retaining talent.” |
About ISOTeam Ltd.
Founded in 1998 and listed on Catalist of the Singapore Exchange Securities Trading Limited on 12 July 2013, ISOTeam Ltd. is an established and eco-conscious player in Singapore’s building maintenance and estate upgrading industry with more than 20 years of Repairs & Redecoration (R&R) and Addition & Alteration (A&A) experience. ISOTeam has successfully undertaken more than 860 refurbishment and upgrading projects for over 7,200 buildings and counting since inception. ISOTeam’s major customers include town councils, government bodies, and private sector building owners.
The company’s website is https://www.isoteam.com.sg.
About kopi-C: the Company brew
This article was first published in kopi-C, a regular column by SGX Research in collaboration with Beansprout (https://growbeansprout.com), a MAS-licensed investment advisory platform, that features C-level executives of leading companies listed on SGX. These interviews are profiles of senior management aimed at helping investors better understand the individuals who run these corporations. Written by Feng Zengkun.
See also: ISOTeam: Here's how profits will return from this year
