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Latest Financial Announcement

FINANCIAL STATEMENTS AND DIVIDEND ANNOUNCEMENT FOR THE FINANCIAL PERIOD ENDED 30 JUNE 2018

Financials Archive

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Income Statement

Balance Sheet

Review of Performance

Statement of Comprehensive Income Review

Revenue

Revenue decreased by $5.4 million or 21.1% from $25.6 million in 3QFY2017 to $20.2 million in 3QFY2018. The decrease was mainly due to decrease in revenue from customers in the Energy Sector. There was an increase in revenue of $12.4 million or 23.1% from $53.8 million in FY2017 to $66.2 million in FY2018 year on year. Revenue from Energy Sector had increased by $15.6 million or 39.8% from $39.0 million in FY2017 to $54.6 million in FY2018. On the other hand, revenue from Marine Sector had decreased by $1.9 million or 40.3% from $4.7 million in FY2017 to $2.8 million in FY2018 and revenue from Trading Sector had decreased by $2.1 million or 23.7% from $9.2 million in FY2017 to $7.1 million in FY2018.

Geographically, year on year, revenue had increased in all markets with the exception of Singapore, Indonesia, Middle East and Europe. Singapore was the main contributor at 32.2% of the revenue generated in FY2018.

Gross Profit and Gross Profit Margin

Despite of the decrease in revenue, gross profit had increased by $0.4 million or 11.7% from $3.1 million in 3QFY2017 to $3.5 million in 3QFY2018. Gross profit margin increased by 5.1 percentage point from 12.3% in 3QFY2017 to 17.4% in 3QFY2018. Likewise, year on year, gross profit had increased by $1.3 million or 14.2% from $8.8 million in FY2017 to $10.1 million in FY2018 while gross profit margin had decreased by 1.1 percentage points from 16.4% in FY2017 to 15.3% in FY2018.

Financial Income and Expense

Financial income had increased by $78 thousand and $69 thousand quarter on quarter and year on year respectively from interest earned on an equity-linked structured investment.

Financial expense had increased by $0.1 million or 89.7% from $0.1 million in 3QFY2017 to $0.2 million in 3QFY2018 mainly due to interest paid on higher borrowings. Similarly, financial expense had increased by $0.1 million or 32.8% from $0.3 million in FY2017 to $0.4 million in FY2018 as per the reason contributing to the quarter on quarter decline.

Operating Expenses

Distribution costs had decreased by $0.2 million or 14.3% from $1.3 million in 3QFY2017 to $1.1 million in 3QFY2018 mainly from decrease in employee benefits expenses. Year on year, distribution costs had decreased by $0.7 million or 14.5% from $4.2 million in FY2017 to $3.5 million in FY2018 mainly from decreases in entertainment expense and employee benefits expenses.

Administrative expenses had decreased by $0.2 million or 12.8% from $1.6 million in 3QFY2017 to $1.4 million in 3QFY2018 mainly from lower employee benefits expenses. The decrease had resulted from lower employee benefits expenses which also accounted for the year on year decrease in administrative costs of $0.8 million or 15.9% from $5.1 million in FY2017 to $4.3 million in FY2018.

Depreciation expense had decreased by $0.2 million or 11.8% from $1.5 million in 3QFY2017 to $1.3 million in 3QFY2018 mainly from lower depreciation on properties, which also resulted in the year on year decrease of $0.4 million or 8.8% from $4.5 million in FY2017 to $4.1 million in FY2018.

Other Credits /(Charges)

Other charges had increased by $0.5 million or 54.1% from $1.0 million in 3QFY2017 to $1.5 million in 3QFY2018 mainly from additional provision for slow moving inventories, partly offset with foreign exchange gain. Year on year, other charges had increased by $0.3 million or 18.4% from $1.7 million in FY2017 to $2.0 million in FY2018 mainly due to foreign exchange loss.

Loss Before Income Tax

Loss before income tax had decreased by $0.4 million or 17.2% from $2.3 million in 3QFY2017 to $1.9 million in 3QFY2018. Year on year, the resulting loss due to the aforementioned reasons was $4.2 million in FY2018 as compared to a loss before income tax of $7.0 million in FY2017.

Other Comprehensive Income/ (Loss)

Other comprehensive loss had decreased by approximately $1.3 million, quarter on quarter and year on year, mainly from the loss on deemed disposal of property. The warehouse located at 90 Second Lok Yang Road (“Property”) was demolished in May 2017 for the construction and development of a warehouse at the Property.

Statement of Financial Position Review

Non-Current Assets

Non-current assets had increased by $2.9 million or 11.7% from $24.3 million as at 30 September 2017 to $27.2 million as at 30 June 2018 mainly due to the construction costs of warehouse located at 90 Second Lok Yang Road, offset by depreciation charged in the current financial period.

Current Assets

Current assets had decreased by $4.2 million or 3.5% from $119.3 million as at 30 September 2017 to $115.1 million as at 30 June 2018. The decrease was mainly due to decrease in cash and cash equivalents, partly offset with increase in inventories and trade and other receivables. Inventories increased by $2.8 million or 4.08% from $68.9 million as at 30 September 2017 to $71.7 million as at 30 June 2018. Trade and other receivables increased by $3.9 million or 14.4% from $27.0 million as at 30 September 2017 to $30.9 million as at 30 June 2018.

Meanwhile, cash and cash equivalents had decreased by $9.1 million or 43.0% from $21.3 million as at 30 September 2017 to $12.2 million as at 30 June 2018.

Non-Current Liabilities

Non-current liabilities had decreased by $1.0 million or 33.7% from $2.9 million as at 30 September 2017 to $1.9 million as at 30 June 2018 from repayment of bank borrowings.

Current Liabilities

Current liabilities had increased by $3.8 million or 10.3% from $37.1 million as at 30 September 2017 to $40.9 million as at 30 June 2018, mainly due to increase in trade and other payables. Trade and other payables had increased by $7.6 million or 145.9% from $5.2 million as at 30 September 2017 to $12.8 million as at 30 June 2018. Other financial liabilities, which consist of short-term borrowings and current portion of long-term borrowings and finance leases, had decreased by $3.1 million or 10.3% from $30.6 million as at 30 September 2017 to $27.5 million as at 30 June 2018.

Equity

Total equity decreased by $4.1 million or 4.0% from $103.6 million as at 30 September 2017 to $99.5 million as at 30 June 2018 mainly from the loss incurred up to 3QY2018.

Statement of Cash Flows Review

Cash Flows (Used in) /From Operating Activities

Cash from operating activities had decreased by $6.0 million from $8.2 million in 3QFY2017 to $2.2 million mainly from the working capital changes. Year on year, cash from operating activities had decreased by $14.6 million from an inflow of $8.1 million in FY2017 to an outflow of $6.5 million in FY2018 as per the reason contributing to the quarter on quarter decrease.

Cash Flows Used In Investing Activities

Cash used in investing activities had increased by $0.8 million from $0.1 million in 3QFY2017 to $0.9 million in 3QFY2018 mainly from the capital expenditure in 3QFY2018. Year on year, cash used in investing activities had increased by $6.9 million from $0.3 million in FY2017 to $7.2 million in FY2018 as per the reason contributing to the quarter on quarter decrease.

Cash Flows (Used In)/ From Financing Activities

Cash used in financing activities had decreased by $0.1 million from $1.7 million in 3QFY2017 to $1.6 million in 3QFY2018 mainly from lower repayment of bank borrowings and increase in cash pledged for bank facilities to secure the issuance of bank guarantees. Year on year, cash used in financing activities had decreased by $10.1 million from an outflow of $6.9 million in FY2017 to an inflow of $3.2 million in FY2018 from the increase in new bank borrowings.

Commentary

We expect to close the current financial year ending 30 September 2018 with a loss.

Despite signs of recovery, the oil and gas sector still faces a number of supply-related challenges. Volatility is also likely to continue in market fundamentals, thus we expect generation of revenue to remain challenging. Gross profit margin is expected to continue to come under pressure due to the competitive conditions.

We will continue to manage our cost more effectively and actively identify new potential markets and suitable opportunities for growth.