Page 23 - cosmosteel

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A REVIEW
OF FY2013
CosmoSteel delivered record
For the 12 months ended 30
September 2013 (“FY2013”),
CosmoSteel recorded a slightly
higher revenueof S$155.7million
despiteanincreasinglychallenging
businesslandscape.Theimproved
revenuewas underpinned by the
Group’s strength in the Energy
and Marine industries.
The Group’s earnings fell 42.4%
to S$6.4 million in FY2013 from
S$11.1 million in the preceding
financial year (“FY2012”).Thiswas
mainly attributable to its strategy
to expand into the upstream
oil and gas value chain and its
participation in a competitive
project which contributed a
significant21.2%orS$33.3million
to the Group’s revenue.
As a result, the Group’s gross
profit and gross profit margins
cameunderpressure–decreasing
to S$29.2 million and 18.8% in
FY2013 fromS$33.2million and
21.4% in FY2012 respectively.
operating & financial review
GROUP
FY2013
S$’000
FY2012
S$’000
Change
%
Revenue
155,712
155,024
0.4
Cost of sales
(126,514)
(121,850)
3.8
Gross profit
29,198
33,174
(12.0)
Other Items of Income
Financial Income
25
22
13.6
Other Items of Expense
Financial Expense
(1,356)
(1,395)
(2.8)
Distribution Costs
(10,070)
(9,329)
7.9
Administrative Expenses
(9,977)
(10,441)
(4.4)
Other Credits/ (Charges)
(559)
1,396
(140.0)
Profit Before Tax from Continuing Operations
7,261
13,427
(45.9)
Income Tax Expense
(897)
(2,371)
(62.2)
Profit from Continuing Operations, Net of Tax
6,364
11,056
(42.4)
Financial expense hovered at the
S$1.4 million mark in FY2013,
while distribution costs went up
7.9% to S$10.1 million, mainly
due to higher manpower costs
and marketing expenditure.
Administrative expenses came
down to S$10.0 mi l l ion in
FY2013, a reduction of S$0.4
million or 4.4% from FY2012,
primarily due to a decrease in
the provision of remuneration
payable to directors based on
profit sharing arrangements
under their service agreements.
The Group also recorded a
charge of S$0.6 mi ll ion in
FY2013, a reversal from the
credit of S$1.4million in FY2012,
which resulted mainly from
both realised and unrealised
foreign currency gains.