Full Year Unaudited Financial Statement Announcement For the Year Ended 30 June 2014

Financials Archive

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Consolidated Income Statement

Consolidated Statement of Comprehensive Income

Balance Sheet

Review of Performance

Turnover

During the fourth quarter ended 30 June 2014, the Group posted a 28% increase in turnover to S$11.19 million, from S$8.74 million in the last corresponding quarter. Revenue from scrap metal ("scrap") division grew by S$3.06 million to S$5.31 million with higher trading volume, whereas lime revenue declined by S$0.60 million to S$5.88 million as demand went down.

For the full year ended 30 June 2014, the Group's turnover rose by 7% from S$30.82 million to S$32.88 million, as lime revenue increased in overall by S$2.18 million to S$25.08 million, whereas scrap revenue decreased by S$0.11 million to S$7.8 million.

Earnings from business operations

The Group incurred an operational loss of S$0.17 million during this fourth quarter, consisting of expenditure of S$0.09 million from the property development ("development") division, a loss from scrap business of S$0.05 million due to higher operating expenses, and a loss from lime business of S$0.03 million resulting from S$0.55 million in impairment on the fair value of investment in Lion Corporation Berhad ("LCB").

In the last corresponding quarter, earnings from business operations amounted to S$0.19 million, of which S$0.17 million and S$0.05 million were derived from lime and scrap respectively, slightly offset by S$0.03 million in development expenditure.

Despite an increase in lime earnings by S$0.38 million to S$2.01 million, a loss from scrap business of S$0.22 million and development expenditure of S$0.23 million were incurred, thereby reducing the Group's earnings from business operations for the full year by S$0.22 million to S$1.56 million.

In the last financial year, earnings from lime and scrap businesses amounted to S$1.63 million and S$0.18 million respectively, whereas S$0.03 million was incurred for development expenses. These gave rise to S$1.78 million in the Group's earnings from business operations. 

Net Earnings

During this fourth quarter, an impairment of S$0.11 million in the investment in Mindax Limited, in addition to that for LCB, resulted in a 41% increase in other expenses of the Group to S$1.78 million. This, coupled with the rise in purchases of inventories, total expenses went up by 33% to S$11.68 million. As a result of tax adjustments, income tax expense increased by 30% to S$0.27 million. Consequently, the Group recorded a net loss of S$0.61 million. If not for the total impairments of S$0.66 million, net earnings would have been S$0.05 million. During the last corresponding quarter, net earnings would have been S$0.28 million instead of a net loss of S$0.10 million, if not for an impairment of S$0.38 million.

On a full-year basis, net earnings of the Group would amount to S$2.49 million, if total impairments of S$0.66 million were not included. Whereas, last financial year's net earnings would have been S$2.16 million, if S$0.38 million in impairment was not accounted for. 

Cash Flows and Financial Position

The Group continues to maintain a healthy liquidity position, with a working capital of S$63.53 million as at 30 June 2014, compared with S$78.43 million as at 30 June 2013. Cash balance of the Group went down from S$66.45 million to S$48.97 million as at 30 June 2014, largely attributable to S$17.67 million in final settlement for the land cost by the development division, which in turn resulted in trade and other payables decreasing from S$21.89 million to S$3.91 million.

As at 30 June 2014, the acquisition cost of land of S$35.17 million was recorded as development property for sale, giving rise to a fall in other current assets from S$36.09 million to S$0.24 million, and also S$16.09 million in net cash deployed in operating activities.

Trade and other receivables of the Group increased from S$11.06 million as at 30 June 2013 to S$12.32 million as at 30 June 2014, and inventories went up from S$5.25 million to S$6.28 million. The impairments brought about a reduction in the Group's available-for-sale financial assets from S$5.35 million to S$2.91 million.

Dividend

The Board is pleased to propose a first and final dividend of 0.1 cent per ordinary share (tax-exempt one-tier) for the financial year ended 30 June 2014. 

Commentary On Current Year Prospects

Intense competition in the marketplace and subdued industry outlook are expected to put further pressure on the Group's businesses. In the meantime, the Group will continue to explore ways to enhance its revenue streams.