First Quarter Financial Statement And Dividend Announcement
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|Cost of Sales||(26,899)||(25,120)||7|
|Other gains/(loss) - net||2,379||(567)||NM|
|- Other operating||(6,246)||(10,872)||(43)|
|Share of loss of associated companies||(114)||(7)||1529|
|Share of loss of a joint venture||(14)||(42)||(67)|
|Profit/(Loss) before income tax||2,084||(4,793)||NM|
|Income tax expense||(668)||(250)||167|
|Other comprehensive loss:|
|Items that may be subsequently reclassified to profit or loss:|
|Currency translation differences arising from consolidation - losses||(94)||(1,202)||(92)|
|Fair value losses on cash flow hedges||(16)||(72)||(78)|
|Total comprehensive income/(loss)||1,306||(6,317)||NM|
|Profit/(Loss) attributable to:|
|Equity holders of the Company||1,504||(3,610)||NM|
|Total comprehensive (loss)/income attributable to:|
|Equity holders of the Company||1,408||(4,884)||NM|
|Denotes: NM - not meaningful|
Notes to the statement of comprehensive income
|Profit/(loss) after income tax was stated after (charging)/crediting:-|
|Depreciation of property, plant and equipment||(7,812)||(7,705)||1|
|Currency exchange gain/(loss) - net||499||(807)||NM|
|Gain on disposal of property, plant and equipment||1,281||28||4475|
|Gain on disposal of a subsidiary||322||-||NM|
|Fair value gain/(loss) on financial assets at fair value through profit or loss||23||(101)||NM|
|Impairment loss on trade receivables||(18)||(4,900)||(100)|
|Write-back of impairment loss on trade receivables||136||200||(32)|
|Over provision in prior years' current income tax||-||166||(100)|
|Over/(under) provision in prior years' deferred tax||14||(62)||NM|
|Denotes: NM - not meaningful|
|Cash and cash equivalents||18,515||14,258|
|Financial assets at fair value through profit or loss||422||399|
|Trade and other receivables||55,388||53,927|
|Other current assets||3,063||2,203|
|Assets of disposal group classified as held for sale||-||1,265|
|Investment in associated companies||3,440||3,531|
|Investment in a joint venture||2,071||2,059|
|Investment in subsidiaries||-||-|
|Property, plant and equipment||389,199||393,571|
|Deferred income tax assets||155||134|
|Trade and other payables||54,542||48,812|
|Current income tax liabilities||1,781||1,455|
|Derivative financial instruments||20||12|
|Liabilities directly associated with disposal|
|group classified as held for sale||-||5,492|
|Derivative financial instruments||18||10|
|Deferred income tax liabilities||26,460||26,376|
|Capital and reserves attributable to equity holders of the Company|
Review on Group's Financial Results
3 Months ended 30 September 2016 (1QFY2017) vs 3 Months ended 30 September 2015 (1QFY2016)
|Heavy Lift and Haulage||27,415||31,056||(12)|
Revenue was S$34.4 million in 1QFY2017, an increase of S$1.3 million or 4% from S$33.1 million in 1QFY2016. The increase was mainly attributed to the increase in contributions from Engineering Services and Trading segments.
Heavy Lift and Haulage segment revenue decreased by S$3.7 million or 12% from S$31.1 million to S$27.4 million, mainly due to fewer projects executed in India and Thailand.
Marine Transportation segment revenue decreased by S$0.2 million or 20% from S$1.1 million to S$0.9 million, mainly due to fewer chartering jobs secured as a result of the downturn in the marine and offshore industry.
Engineering Services segment revenue increased by S$4.7 million or 522% from S$0.9 million to S$5.6 million, mainly due to an increase in progress from a project in the Middle East.
Trading segment revenue increased by S$0.4 million or 574% from S$0.1 million to S$0.5 million, mainly due to a crane sold in 1QFY2017.
Gross Profit was S$7.5 million in 1QFY2017, a decrease of S$0.5 million or 6% from S$8.0 million in 1QFY2016. Gross Profit Margin was also lower at 22% in 1QFY2017 as compared to 24% in 1QFY2016. This was mainly due to higher costs incurred for an Engineering Services project.
Other Gains/(Loss)-net recorded a gain of S$2.4 million in 1QFY2017 as compared to a loss of S$0.6 million in 1QFY2016. This was mainly attributable to gain on disposal of plant and equipment of S$1.3 million, operational exchange gain of S$0.5 million and gain from the disposal of a subsidiary of S$0.3 million in 1QFY2017, as compared to operational exchange loss of S$0.6 million which was offset by a marginal gain on disposal of plant and equipment of S$0.03 million in 1QFY2016.
Other Operating Expenses were S$6.2 million in 1QFY2017, a decrease of S$4.7 million or 43% from S$10.9 million in 1QFY2016. This was mainly due to a lower impairment loss on trade receivables of S$0.02 million in 1QFY2017 as compared to S$4.9 million in 1QFY2016.
Finance Expenses were S$1.0 million in 1QFY2017, an increase of S$0.1 million or 15% from S$0.9 million in 1QFY2016. This was mainly due to higher interest expense of S$1.0 million in 1QFY2017 as compared to S$0.7 million in 1QFY2016. However, the increase in interest expense was offset by higher currency translation loss of S$0.2 million relating to foreign currency denominated borrowings in 1QFY2016 as compared to S$0.04 million in 1QFY2017.
|Profit/(Loss) before Income Tax||1QFY2017
|Heavy Lift and Haulage||3,055||1,672||83|
Loss before Income Tax was S$2.1 million in 1QFY2017 as compared to a loss before income tax of S$4.8 million in 1QFY2016.
Profit before income tax from Heavy Lift and Haulage segment increased by S$1.4 million or 83%, from S$1.7 million in 1QFY2016 to S$3.1 million in 1QFY2017. The increase was mainly due to operational exchange gain of S$0.5 million in 1QFY2017 as compared to operational exchange loss of S$0.6 million and impairment loss on trade receivables of S$0.8 million in 1QFY2016.
Loss before income tax from Marine Transportation segment decreased by S$2.3 million or 93%, from S$2.5 million in 1QFY2016 to S$0.2 million in 1QFY2017. This was mainly due to gain on disposal of plant and equipment of S$0.9 million which was offset by a lower impairment loss on trade receivables of S$0.02 million in 1QFY2017 as compared to impairment loss on trade receivables of S$1.1 million in 1QFY2016.
Loss before income tax from Engineering Services segment decreased by S$3.0 million or 76% from S$4.0 million in 1QFY2016 to S$1.0 million in 1QFY2017, due to impairment loss on trade receivable of S$3.0 million in 1QFY2016.
Profit before income tax from Trading segment increased by S$0.1 million or 341% from S$0.04 million in 1QFY2016 to S$0.2 million in 1QFY2017, mainly due to sale of a crane in 1QFY2017.
Review of Statements of Financial Position and Cash Flows
Cash and cash equivalents per consolidated statement of cash flow increased by S$4.2 million from S$11.2 million as at 30 June 2016 to S$15.4 million as at 30 September 2016 mainly due to net cash inflow from operating activities and investing activities of S$11.1 million and S$0.3 million respectively. This was offset by the net cash outflow from financing activities of S$7.2 million.
As a result of the improved cash and financial position of the Group, the Group's net current liabilities position of S$7.3 million as at 30 June 2016 was reduced to S$6.7 million as at 30 September 2016. The Group had sufficient undrawn financing facilities committed from large reputable financial institutions to meet its commitments as well as to repay debts as and when they fall due for the next twelve months from 30 September 2016.
Inventories increased by S$0.6 million from S$1.4 million as at 30 June 2016 to S$2.0 million as at 30 September 2016 mainly due to the purchase of equipment in 1QFY2017.
Other current assets increased by S$0.9 million from S$2.2 million as at 30 June 2016 to S$3.1 million as at 30 September 2016 mainly due to the increase in prepayments for insurance premium.
Trade and other payables increased by S$5.7 million from S$48.8 million as at 30 June 2016 to S$54.5 million as at 30 September 2016. The increase was mainly attributable to amounts payable for the construction of workers' dormitory at No.15 Pandan Crescent; and amounts due to suppliers for Engineering Services project in the Middle East.
Current income tax liabilities increased by S$0.3 million from S$1.5 million as at 30 June 2016 to S$1.8 million as at 30 September 2016 mainly due to provision for income tax for current period.
Total borrowings decreased by S$3.8 million from S$136.0 million as at 30 June 2016 to S$132.2 million as at 30 September 2016 mainly due to repayments made during the current period.
Commentary On Current Year Prospects
The operating environment continues to be challenging and competitive amid the slowdown in demand in the key markets we operate in. The Group expects that the on-going public sector infrastructure development in Singapore will support the impetus for heavy lift and haulage services.
Meanwhile, the Group will continue to effectively manage operating costs and business risks to remain competitive. It will also continue to explore strategic collaborations and leverage on its capabilities and track record as a one-stop integrated heavy lift specialist and service provider to target complex and high value projects to grow the business.