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First Quarter Financial Statement And Dividend Announcement

Financials Archive

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  Group
  1QFY2019
S$'000
1QFY2018
S$'000
Increase/ (Decrease)
%
Revenue 28,455 23,485 21
Cost of sales (19,336) (18,235) 6
Gross profit 9,119 5,250 74
Other income 114 144 (21)
Other (loss)/gains - net (1,241) 21 NM
Expenses      
- Administrative (342) (316) 8
- Other operating (5,587) (5,663) (1)
- Finance (792) (802) (1)
Share of profit of associated companies 207 7 NM
Share of loss of a joint venture (2) (5) (60)
Profit/(Loss) before income tax 1,476 (1,364) NM
Income tax expense (310) (215) 44
Total profit/(loss) 1,166 (1,579) NM
Other comprehensive income/(loss):      
Items that may be subsequently reclassified to profit or loss:      
Currency translation differences arising from consolidation      
- Gains/(Losses) (162) 532 NM
Fair value gains/(losses) on cash flow hedges (1) 8 NM
  (163) 540 NM
Total comprehensive (loss)/income 1,003 (1,039) NM
(Loss)/Profit attributable to:      
Equity holders of the Company 1,176) (1,437) NM
Non-controlling interest (10) (142) (93)
  1,166 (1,579) NM
Total comprehensive (loss)/income attributable to:      
Equity holders of the Company 1,024 (917) NM
Non-controlling interest (21) (122) (83)
  1,003 (1,039) NM
Denotes: NM - not meaningful

Note to the Statement of Comprehensive Income

  Group
  1QFY2019
S$'000
1QFY2018
S$'000
Increase/ (Decrease)
%
Profit/(Loss) after income tax was stated after crediting/(charging)/:
Depreciation of property, plant and equipment (7,465) (7,723) (3)
Currency exchange loss - net (1,268) (426) 198
Gain on disposal of property, plant and equipment 107 395 (73)
Fair value (loss) / gain on financial assets at fair value through profit or loss (77) 57 NM
Impairment written back on trade receivables 47 43 9
Interest income 8 5 60
Interest expense (795) (807) (1)
Over provision in prior years' deferred tax - 4 (100)
Denotes: NM - not meaningful

Balance Sheet

  Group
  As at
30/09/2018
S$'000
As at
30/06/2018
S$'000
ASSETS    
Current assets    
Cash and cash equivalents 9,158 8,502
Financial assets at fair value through profit or loss 410 488
Trade and other receivables 49,537 42,937
Tax recoverable 57 67
Inventories 1,358 1,347
Other current assets 2,300 1,199
Derivative financial instruments 1 2
  62,821 54,542
     
Non-current assets    
Other receivables - -
Investment in associated companies 2,885 2,676
Investment in a joint venture 2,064 2,060
Investment in subsidiaries - -
Property, plant and equipment 353,785 353,239
Deferred income tax assets 536 578
  359,270 358,553
Total assets 422,091 413,095
     
LIABILITIES    
Current liabilities    
Trade and other payables 31,738 29,030
Current income tax liabilities 1,050 1,075
Borrowings 30,632 21,456
  63,420 51,561
     
Non-current liabilities    
Borrowings 81,225 85,263
Deferred income tax liabilities 26,710 26,538
  107,935 111,801
Total liabilities 171,355 163,362
NET ASSETS 250,736 249,733
     
EQUITY    
Capital and reserves attributable to    
equity holders of the Company    
Share capital 87,340 87,340
Other reserves (2,726) (2,574)
Retained earnings 165,945 164,769
  250,559 249,535
Non-controlling interest 177 198
Total equity 250,736 249,733

Review on Group's Financial Results

3 Months ended 30 September 2018 (1QFY2019) vs 3 Months ended 30 September 2017 (1QFY2018)

Revenue 1QFY2019
S$'000
1QFY2018
S$'000
Increase/ (Decrease)
%
Heavy Lift and Haulage 27,442 22,794 20
Marine Transportation 1,002 375 167
Engineering Services - 239 (100)
Trading 11 77 (86)
  23,485 23,485 21

Revenue was S$28.5 million in 1QFY2019, an increase of S$5.0 million or 21% from S$23.5 million in 1QFY2018. The increase was mainly attributable to the increase in contribution from Heavy Lift and Haulage segment.

Heavy Lift and Haulage segment revenue increased by S$4.6 million or 20% from S$22.8 million in 1QFY2018 to S$27.4 million in 1QFY2019, mainly due to more projects executed in Singapore and Brunei.

Marine Transportation segment revenue increased by S$0.6 million or 167% from S$0.4 million in 1QFY2018 to S$1.0 million in 1QFY2019, mainly due to more chartering jobs secured in Malaysia.

Engineering Services segment revenue decreased by S$0.2 million or 100% from S$0.2 million in 1QFY2018 to S$Nil in 1QFY2019, due to the completion of the engineering project in the Middle East and the disposal of an engineering services subsidiary in FY2018.

Trading segment revenue remained low at below S$0.1 million for both 1QFY2019 and 1QFY2018 as there was no equipment sold during these quarters.

Gross Profit was S$9.1 million in 1QFY2019, an increase of S$3.8 million or 74% from S$5.3 million in 1QFY2018. Gross Profit Margin was higher at 32% in 1QFY2019 as compared to 22% in 1QFY2018. The increase in gross profit was mainly due to higher turnover from the Heavy Lift and Haulage segment and improved performance from the Marine Transportation segment.

Other (Losses)/Gains - net recorded a loss of S$1.2 million in 1QFY2019 as compared to a gain of S$0.02 million in 1QFY2018. This was mainly attributable to operational exchange loss of S$1.3 million which was offset by gain on disposal of property, plant and equipment of S$0.1 million in 1QFY2019, as compared to gain on disposal of property, plant and equipment of S$0.4 million which was offset by operational exchange loss of S$0.4 million in 1QFY2018.

Share of Profit of Associated Companies was S$0.2 million in 1QFY2019 as compared to S$0.01 million in 1QFY2018, mainly due to improved performance by the associated companies in 1QFY2019.

Profit/(Loss) before Income Tax 1QFY2019
S$'000
1QFY2018
S$'000
Increase/ (Decrease)
%
Heavy Lift and Haulage 1,797 (455) NM
Marine Transportation (310) (475) (35)
Engineering Services - (459) (100)
Trading (11) 25 NM
  1,476 (1,364) NM

Profit before Income Tax was S$1.5 million in 1QFY2019 as compared to a loss before income tax of S$1.4 million in 1QFY2018.

Heavy Lift and Haulage segment recorded a profit before income tax of S$1.8 million in 1QFY2019 as compared to a loss before income tax of S$0.5 million in 1QFY2018, mainly due to higher turnover in 1QFY2019.

Marine Transportation segment incurred a loss before income tax of S$0.3 million in 1QFY2019. The loss was reduced by S$0.2 million or 35%, from S$0.5 million in 1QFY2018, mainly due to higher turnover in 1QFY2019.

Engineering Services segment reported a loss before income tax of S$0.5 million in 1QFY2018 as compared to S$Nil in 1QFY2019, due to the completion of the engineering project in the Middle East and the disposal of an engineering services subsidiary in FY2018.

Trading segment registered a loss before income tax of S$0.01 million in 1QFY2019 as compared to a profit before income tax of S$0.02 million in 1QFY2018, mainly due to lower sales in 1QFY2019.

Review of Statements of Financial Position and Cash Flows

Cash and cash equivalents per consolidated statement of cash flow increased by S$0.7 million from S$8.5 million as at 30 June 2018 to S$9.2 million as at 30 September 2018 mainly due to net cash inflows from operating activities and financing activities of S$5.3 million and S$4.3 million respectively. This was offset by the net cash outflow from investing activities of S$8.9 million. Net cash outflow from investing activities of S$8.9 million resulted mainly from the purchase of property, plant and equipment of S$9.6 million offset by proceeds from disposal of property, plant and equipment of S$0.7 million. Net cash inflow from financing activities of S$4.3 million resulted mainly from the proceeds from borrowings of S$11.2 million offset by the repayment of borrowings of S$6.1 million.

As at 30 September 2018, the Group was in a net current liabilities position of S$0.6 million, mainly due to bills payables to bank for the purchase of major equipment amounted to S$9.0 million. 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 2018.

Trade and other receivables increased by S$6.6 million from S$42.9 million as at 30 June 2018 to S$49.5 million as at 30 September 2018. This was mainly attributable to the higher turnover recorded in this quarter.

Other current assets increased by S$1.1 million from S$1.2 million as at 30 June 2018 to S$2.3 million as at 30 September 2018, mainly due to the increase in prepayments for insurance premium.

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 provide support for more business opportunities.

The Group remains committed to effectively managing operating costs and business risks to stay competitive. It will 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.