Financial Statements And Related Announcement - Full Yearly Results 2024

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• CONDENSED INTERIM CONSOLIDATED STATEMENT OF PROFIT OR LOSS
  

  Notes:
  (1) 2HY2024 : 6 months ended 30 June 2024
  (2) 2HY2023 : 6 months ended 30 June 2023
  (3) FY2024 : 12 months ended 30 June 2024
  (4) FY2023 : 12 months ended 30 June 2023
  (5) n.m.: not meaningful.

• CONDENSED INTERIM CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
  
• CONDENSED INTERIM STATEMENTS OF FINANCIAL POSITION
  
• FINANCIAL PERFORMANCE REVIEW

  Comparing 2HY2024 to 2HY2023

  Revenue

  Revenue decreased by S$2.4 million or 6.9% to S$32.2 million for the financial period from 1 January 2024 to 30 June 2024 ("2HY2024") from S$34.6 million for the financial period from 1 January 2023 to 30 June 2023 ("2HY2023").

  • Marine & Offshore Segment revenue decreased by 6.5% or S$2.2 million in 2HY2024 as compared to 2HY2023 due to the decrease in revenue contribution from the mooring and rigging business.
  • Revenue contribution from Property Segment decreased by 28.9% or S$0.2 million in 2HY2024 as compared to 2HY2023. The decrease was mainly due to the decrease in renovation projects, and this had also contributed to the decrease in cost of sales for this segment.

  Gross profit

  The Group's gross profit of S$11.9 million in 2HY2024 was a decrease of S$0.4 million or 3.7% compared to 2HY2023. The Group's gross profit margin increased to 36.9% in 2HY2024 as compared to 35.6% in 2HY2023.

  • Marine & Offshore Segment contributed gross profit of S$11.5 million to the Group in 2HY2024 as compared to S$11.9 million in 2HY2023. The gross profit margin increased to 36.1% in 2HY2024 from 35.2% in 2HY2023, mainly due to the higher gross profit margin from the mooring and rigging business.
  • Property Segment contributed gross profit of S$0.4 million to the Group in 2HY2023, of which S$0.3 million was contributed by the Group's property consultancy business.

  Other operating income

  Other operating income decreased by S$155,000 to S$52,000 in 2HY2024 from S$207,000 in 2HY2023 mainly due to lower foreign exchange gain.

  Distribution expenses

  Distribution expenses decreased by S$31,000 or 4.2% to S$702,000 in 2HY2024 from S$733,000 in 2HY2023 due to lower freight costs as a result of easing in supply chain disruptions.

  Administrative expenses

  Administrative expenses increased by S$0.5 million or 7.7% to S$6.9 million in 2HY2024 from S$6.4 million in 2HY2023, mainly due to higher manpower costs, driven by necessary salary adjustments to enhance our competitiveness in the market.

  Other operating expenses

  Other operating expenses increased by S$0.3 million or 17.1% to S$2.5 million in 2HY2024 from S$2.2 million in 2HY2023. The increase was mainly due to (i) increase in depreciation of property, plant and equipment by S$0.1 million and (ii) increase in foreign exchange loss by S$0.2 million.

  Finance income

  Finance income, comprising mainly interest income from bank deposits, remained insignificant for 2HY2024.

  Finance costs

  Finance costs decreased marginally by S$12,000 or 1.9% in 2HY2024.

  Income tax expense

  In 2HY2024, the Group incurred an income tax expense of S$0.4 million as compared to S$0.5 million in 2HY2023.

  Profit for the year

  Combining the profit before tax of S$1.3 million for the Marine & Offshore Segment and the unallocated head office expenses of S$0.1 million, the Group's profit before tax was S$1.2 million in 2HY2024 as compared to a profit before tax of S$2.7 million in 2HY2023. Overall, the Group reported profit after taxation of S$0.8 million for 2HY2024 (2HY2023: S$2.1 million).

  Comparing FY2024 to FY2023

  Revenue

  Revenue decreased by S$10.3 million or 14.6% to S$60.4 million for FY2024 from S$70.7 million for FY2023.

  • Marine & Offshore Segment revenue decreased by S$4.5 million or 6.9% in FY2024 as compared to FY2023. The decrease was mainly attributable to decreased revenue contribution from the mooring and rigging business.
  • Revenue contribution from Property Segment decreased by S$5.8 million or 84.1% in FY2024 as compared to FY2023. The decrease was mainly due to the absence of sale of a semi- detached landed property. This had also contributed to the decrease in cost of sales for this segment.

  Gross profit

  The Group's gross profit of S$22.5 million in FY2024 decreased by S$1.1 million or 4.5% from S$23.6 million in FY2023. The Group's gross profit margin improved to 37.3% in FY2024 as compared to 33.4% in FY2023.

  • Marine & Offshore Segment contributed gross profit of S$21.7 million to the Group in FY2024 as compared to S$22.5 million in FY2023. The gross profit margin increased to 36.6% in FY2024 from 35.4% in FY2023, mainly due to higher gross profit margin from the mooring and rigging business.
  • Property Segment contributed gross profit of S$0.8 million to the Group in FY2024, mainly from Group's property consultancy business.

  Other operating income

  Other operating income increased by S$0.2 million or 60.0% to S$0.6 million in FY2024 from S$0.4 million in FY2023. The increase was mainly due to the gain on disposal of asset held for sale.

  Distribution expenses

  Distribution expenses decreased by S$0.1 million or 5.6% to S$1.5 million in FY2024 from S$1.6 million in FY2023 due to lower freight costs as a result of easing in supply chain disruptions.

  Administrative expenses

  Administrative expenses increased by S$0.7 million or 5.3% to S$14.0 million in FY2024 from S$13.3 million in FY2023. The increase was mainly due to (i) increase in manpower costs by S$0.3 million, driven by necessary salary adjustments to enhance hiring competitiveness in the market and (ii) increase in insurance premium by S$0.2 million and (iii) increase in professional fees by S$0.2 million.

  Other operating expenses

  Other operating expenses increased by S$0.3 million or 7.9% to S$4.8 million in FY2024 from S$4.5 million in FY2023. The increase was mainly due to (i) increase in depreciation of property, plant and equipment by S$0.2 million and (ii) increase in foreign exchange loss by S$0.1 million.

  Finance income

  Finance income, comprising mainly interest income from bank deposits, remained insignificant for FY2024.

  Finance costs

  Finance costs increased by S$0.1 million or 4.8% to S$1.3 million in FY2024 from S$1.2 million in FY2023 due to higher interest rates in FY2024 compared to FY2023.

  Income tax expense

  In FY2024, the Group incurred an income tax expense of S$0.7 million as compared to S$0.6 million in FY2023.

  Profit for the year

  Combining the profit before tax of S$2.3 million for the Marine & Offshore Segment, loss before tax of S$0.3 million for the Property Segment and the unallocated head office expenses of S$0.4 million, the Group's profit before tax was S$1.6 million in FY2024 as compared to a profit before tax of S$3.5 million in FY2023. After accounting for income tax expense of S$0.7 million in FY2024, the Group's profit for FY2024 was S$0.9 million as compared to a profit of S$2.8 million in FY2023.

• FINANCIAL POSITION REVIEW

  Non-current assets

  Non-current assets increased by S$0.4 million to S$15.1 million as at 30 June 2024 from S$14.7 million as at 30 June 2023. The increase was mainly due to the following:

  • Property, plant and equipment increased by S$0.2 million, due to the acquisition of plant and equipment of S$2.2 million partially offset by depreciation of property, plant and equipment of S$2.0 million; and
  • Other investment increased by S$0.4 million due to purchase of keyman insurance.

  The increase stated above was partially offset by a decrease in trade and other receivables by S$0.2 million due to monthly repayments from the global settlement of a legal suit.

  Current assets

  Current assets decreased by S$2.1 million from S$42.4 million as at 30 June 2023 to S$40.3 million as at 30 June 2024. The decrease was mainly due to the following:

  • Trade and other receivables decreased by S$0.5 million, which is in line with the decrease in Marine & Offshore Segment revenue in FY2024;
  • Assets held for sale decreased by S$0.6 million as at 30 June 2024 following the disposal of a leasehold property owned by TEHO Water & Envirotec Pte Ltd in FY2024; and
  • Cash and cash equivalents decreased by S$1.5 million from S$8.1 million as at 30 June 2023 to S$6.6 million as at 30 June 2024. Please refer to the "Cash Flows Review" section below for details.

  The decrease stated above was partially offset by the increase in inventory by S$0.5 million from S$22.9 million as at 30 June 2023 to S$23.4 million as at 30 June 2024. This increase was attributed to proactive measures taken in anticipation of extended lead times for the supply of inventory within the Marine & Offshore Segment.

  Non-current liabilities

  Non-current liabilities decreased by S$1.4 million to S$7.5 million as at 30 June 2024 from S$8.9 million as at 30 June 2023. The decrease was mainly due to the following:

  • Loans and borrowings decreased by S$1.3 million as a result of repayment of term loans and lease liabilities; and
  • Deferred grant income decreased by $0.1 million arising from the amortisation of grant received over the useful life of the process improvement projects for the mooring and rigging business.

  Current liabilities

  Current liabilities decreased by S$0.8 million to S$24.3 million as at 30 June 2024 from S$25.1 million as at 30 June 2023. The decrease was mainly due to the following:

  • Current portion of loans and borrowings decreased by S$0.9 million, as a result of repayment of term loans and lease liabilities;
  • Trade and other payables decreased by S$0.5 million due to slowdown in purchase of goods in June 2024 in order to maintain inventories at the optimum level; and
  • Current tax liabilities decreased by S$0.2 million due to lower profit for the year.

  The decrease stated above was partially offset by the increase in contract liabilities by S$0.8 million attributed from higher advance payments from customers.
  
  Shareholders' equity

  As a result of the above, total equity of the Group increased by S$0.5 million to S$23.6 million as at 30 June 2024 from S$23.1 million as at 30 June 2023.

• CASH FLOWS REVIEW

  The Group's net cash flows generated from operating activities was S$4.0 million in FY2024 compared to S$12.5 million in FY2023. The decrease was mainly due to higher inventory levels in Marine & Offshore Segment's business and absence of sale proceeds from development properties.

  Net cash flows used in investing activities amounted to S$0.1 million in FY2024 was mainly due to (i) capital expenditure on the acquisition of property, plant and equipment of S$0.5 million and (ii) purchase of keyman insurance of S$0.4 million; partially offset by proceeds from disposal of asset held for sale of S$0.8 million.

  Net cash flows used in financing activities amounted to S$5.4 million in FY2024 was mainly due to dividend payment of S$0.2 million, interest payment of S$1.3 million, repayment of loans and borrowings of S$22.1 million, and payment of lease liabilities of S$1.0 million; partially offset by proceeds from the drawdown of loans and borrowings of S$19.2 million.

  As at 30 June 2024, the Group has cash and cash equivalents of S$6.6 million as compared to S$8.1 million as at 30 June 2023.

• COMMENTARY

  Amid the challenging and difficult environment, the Group was able to achieve positive operating results for FY2024. Overall, we remain cautious while prioritising costs and operational efficiencies to safeguard our financial health and position our Group for sustained growth in the coming year.