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Financial Statements

Second Quarter and First Half Financial Statements and Dividend Announcement

Financials Archive

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Statement of comprehensive income

  Group Group
  2QFY2018
S$'000
2QFY2017
S$'000
Increase/ (Decrease)
%
1HY2018
S$'000
2HY2017
S$'000
Increase/ (Decrease)
%
Revenue 28,200 31,257 (10) 51,685 65,646 (21)
Cost of sales (20,333) (22,475) (10) (38,568) (49,374) (22)
Gross profit 7,867 8,782 (10) 13,117 16,272 (19)
Other income 495 312 59 639 539 19
Other gains - net 81 1,811 (96) 102 3,974 (97)
Expenses            
- Administrative (345) (311) 11 (661) (727) (9)
- Other operating (6,299) (6,439) (2) (11,962) (12,685) (6)
- Finance (787) (1,041) (24) (1,589) (2,047) (22)
Share of loss of associated companies (106) (45) 136 (99) (159) (38)
Share of profit/(loss) of a joint venture 12 (45) NM 7 (59) NM
Profit/(Loss) before income tax 918 3,024 (70) (446) 5,108 NM
Income tax expense (490) (1,015) (52) (705) (1,683) (58)
Total profit/(loss) 428 2,009 (79) (1,151) 3,425 NM
Other comprehensive income/(loss):
Items that may be subsequently reclassified
to profit or loss:
Currency translation differences arising from
consolidation - gain/(loss) 665 (203) NM 1,197 (297) NM
Fair value gain on cash flow hedges 6 29 (79) 14 13 8
  671 (174) NM 1,211 (284) NM
Total comprehensive income 1,099 1,835 (40) 60 3,141 (98)
Profit/(Loss) attributable to:
Equity holders of the Company 520 1,816 (71) (917) 3,320 NM
Non-controlling interest (92) 193 NM (234) 105 NM
  428 2,009 (79) (1,151) 3,425 NM
Total comprehensive income/(loss) attributable to:
Equity holders of the Company 1,186 1,633 (27) 269 3,041 (91)
Non-controlling interest (87) 202 NM (209) 100 NM
  1,099 1,835 (40) 60 3,141 (98)
Denotes: NM - not meaningful

Note to the Statement of Comprehensive Income

  Group
  2QFY2018
S$'000
2QFY2017
S$'000
Increase/ (Decrease)
%
1HFY2018
S$'000
1HFY2017
S$'000
Increase/ (Decrease)
%
Profit/(Loss) after income tax was stated after crediting/(charging):
Depreciation of property, plant and equipment (7,598) (7,824) (3) (15,321) (15,636) (2)
Currency exchange (loss)/gain - net (165) 1,563 NM (591) 2,062 NM
Gain on disposal of property, plant and equipment 678 140 384 1,073 1,421 (24)
(Loss)/Gain on disposal of a subsidiary (461) - NM (461) 322 NM
Fair value gain/(loss) on financial assets at fair value through profit or loss 50 (17) NM 107 6 1683
Impairment loss on trade receivables - - NM - (18) (100)
Write-back of impairment loss on trade receivables 163 396 (59) 206 532 (61)
Interest income 9 26 (65) 14 37 (62)
Interest expense (806) (916) (12) (1,613) (1,883) (14)
Under provision in prior years' current income tax (10) (25) (60) (10) (25) (60)
Over provision in prior years' deferred tax - - NM 4 14 (71)
Denotes: NM - not meaningful

Balance Sheet

  Group
  As at
31/12/2017
S$'000
As at
30/06/2017
S$'000
ASSETS    
Current assets    
Cash and cash equivalents 9,166 10,879
Financial assets at fair value through profit or loss 568 462
Trade and other receivables 42,749 42,835
Tax recoverable 79 53
Inventories 1,456 1,510
Other current assets 1,958 1,843
  55,976 57,582
     
Non-current assets    
Other receivables - -
Investment in associated companies 2,965 3,121
Investment in a joint venture 2,022 2,074
Investment in subsidiaries - -
Property, plant and equipment 365,863 380,236
Deferred income tax assets 478 491
  371,328 385,922
Total assets 427,304 443,504
     
LIABILITIES    
Current liabilities    
Trade and other payables 34,055 42,370
Current income tax liabilities 1,338 1,708
Borrowings 25,642 29,871
Derivative financial instruments 2 12
  61,037 73,961
     
Non-current liabilities    
Borrowings 92,254 95,305
Derivative financial instruments - 4
Deferred income tax liabilities 26,808 26,646
  119,062 121,955
Total liabilities 180,099 195,916
NET ASSETS 247,205 247,588
     
EQUITY    
Capital and reserves attributable to    
equity holders of the Company    
Share capital 87,340 87,340
Other reserves (3,014) (4,200)
Retained earnings 162,657 163,574
  246,983 246,714
Non-controlling interest 222 874
Total equity 247,205 247,588

Review on Group's Financial Results

3 Months ended 31 December 2017 (2QFY2018) vs 3 Months ended 31 December 2016 (2QFY2017)

Revenue 2QFY2018
S$'000
2QFY2017
S$'000
Increase/ (Decrease)
%
1HFY2018
S$'000
1HFY2017
S$'000
Increase/ (Decrease)
%
Heavy Lift and Haulage 25,010 25,545 (2) 47,804 52,960 (10)
Marine Transportation 593 1,118 (47) 968 1,975 (51)
Engineering Services 681 3,420 (80) 920 9,066 (90)
Trading 1,916 1,174 63 1,993 1,645 21
  28,200 31,257 (10) 51,685 65,646 (21)

Revenue was S$28.2 million in 2QFY2018, a decrease of S$3.1 million or 10% from S$31.3 million in 2QFY2017. The decrease was mainly attributed to the decrease in contributions from the Engineering Services segment.

Heavy Lift and Haulage segment revenue decreased by S$0.5 million or 2% from S$25.5 million in 2QFY2017 to S$25.0 million in 2QFY2018. There were fewer projects executed in Singapore and the Middle East but there was increase in projects from Malaysia in 2QFY2018.

Marine Transportation segment revenue decreased by S$0.5 million or 47% from S$1.1 million in 2QFY2017 to S$0.6 million in 2QFY2018, mainly due to fewer and shorter chartering jobs secured as a result of the downturn in the offshore and marine industry.

Engineering Services segment revenue decreased by S$2.7 million or 80% from S$3.4 million in 2QFY2017 to S$0.7 million in 2QFY2018, mainly due to the substantial completion of a project in the Middle East. There were also contributions from certain projects in Singapore and Vietnam in 2QFY2017 but none in 2QFY2018.

Trading segment revenue increased by S$0.7 million or 63% from S$1.2 million in 2QFY2017 to S$1.9 million in 2QFY2018, mainly due to more equipment sold in 2QFY2018.

Gross Profit was S$7.9 million in 2QFY2018, a decrease of S$0.9 million or 10% from S$8.8 million in 2QFY2017 due to lower revenue. Gross Profit Margin was consistent at 28% for both 2QFY2018 and 2QFY2017.

Other income was S$0.5 million in 2QFY2018, an increase of S$0.2 million or 59% from S$0.3 million in 2QFY2017, mainly due to higher insurance claims received.

Other Gains -net was S$0.1 million in 2QFY2018, a decrease of S$1.7 million or 96% from S$1.8 million in 2QFY2017. This was mainly attributable to gain on disposal of plant and equipment of S$0.7 million which was offset by loss on disposal of a subsidiary of S$0.5 million and operational exchange loss of S$0.2 million in 2QFY2018 as compared to operational exchange gain of S$1.7 million and gain on disposal of plant and equipment of S$0.1 million 2QFY2017.

Administrative Expenses were S$0.4 million in 2QFY2018, an increase of S$0.1 million or 11% from S$0.3 million in 2QFY2017, mainly due to higher professional fees incurred.

Finance Expenses were S$0.8 million in 2QFY2018, a decrease of S$0.2 million or 24% from S$1.0 million in 2QFY2017, mainly due to the lower bank borrowings.

Profit/(Loss) before Income Tax 2QFY2018
S$'000
2QFY2017
S$'000
Increase/ (Decrease)
%
1HFY2018
S$'000
1HFY2017
S$'000
Increase/ (Decrease)
%
Heavy Lift and Haulage 1,732 3,411 (49) 1,277 6,466 (80)
Marine Transportation (488) (856) (43) (963) (1,026) (6)
Engineering (397) 377 NM (856) (587) 46
Trading 71 92 (23) 96 255 (62)
  918 3,024 (70) (446) 5,108 NM

Profit before Income Tax was S$0.9 million in 2QFY2018, a decrease of S$2.1 million or 70%, from S$3.0 million in 2QFY2017.

Heavy Lift and Haulage segment recorded a profit before income tax of S$1.7 million in 2QFY2018, a decrease of S$1.7 million or 49%, from S$3.4 million in 2QFY2017, mainly due to exchange loss of S$0.1 million which was offset by write-back of impairment loss on trade receivables of S$0.1 million in 2QFY2018 as compared to exchange gain of S$1.4 million and write-back of impairment loss on trade receivables of S$0.4 million in 2QFY2017.

Marine Transportation segment incurred a loss before income tax of S$0.5 million in 2QFY2018, a decrease of S$0.4 million or 43%, from S$0.9 million in 2QFY2017, mainly due to exchange gain of S$0.1 million and write-back of impairment loss on trade receivables of S$0.1 million in 2QFY2018 as compared to exchange loss of S$0.1 million in 2QFY2017.

Engineering Services segment registered a loss before income tax of S$0.4 million in 2QFY2018 as compared to a profit before income tax of S$0.4 million in 2QFY2017. This was mainly attributable to loss on disposal of a subsidiary of S$0.5 million in 2QFY2018. There were higher margins generated from the completion of certain projects in Singapore and Vietnam in 2QFY2017.

Trading segment reported a profit before income tax of S$0.1 million in both 2QFY2018 and 2QFY2017.

The effective tax rate of the Group was higher, mainly due to losses incurred by overseas subsidiaries which cannot be offset against profit earned by other entities in the Group.

Review of Statements of Financial Position and Cash Flows

Cash and cash equivalents per consolidated statement of cash flow increased by S$0.5 million from S$8.4 million as at 30 June 2017 to S$8.9 million as at 31 December 2017 mainly due to net cash inflows from operating activities and investing activities of S$10.6 million and S$1.0 million respectively. This was offset by the net cash outflow from financing activities of S$11.2 million. Net cash outflow from financing activities of S$11.2 million resulted mainly from the repayment of borrowings of S$19.5 million offset by proceeds from borrowings of S$9.9 million.

As at 31 December 2017, the Group was in a net current liabilities position of S$5.1 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 31 December 2017.

Total trade and other payables decreased by S$8.3 million from S$42.4 million as at 30 June 2017 to S$34.1 million as at 31 December 2017. The decrease was mainly due to payments to creditors for purchases of equipment and services; and payment to the main contractor for the redevelopment of its premises at 15 Pandan Crescent.

Total borrowings decreased by S$7.3 million from S$125.2 million as at 30 June 2017 to S$117.9 million as at 31 December 2017, mainly due to repayment of bank borrowings.

Current income tax liabilities decreased by S$0.4 million from S$1.7 million as at 30 June 2017 to S$1.3 million as at 31 December 2017, mainly due to payment of income tax 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 provide support for more business opportunities.

The Group remains committed to effectively manage 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.

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