Financial Statement for the First Quarter and Three months Ended 31 March 2018

Financials Archive

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Profit & Loss

  First quarter ended 31 March
Revenue 40,673 29,512 37.8
Cost of sales (36,962) (24,651) 49.9
Gross profit 3,711 4,861 (23.7)
Other operating income 582 749 (22.3)
Other expense 110 (187) N.M
Administrative costs (2,073) (2,015) 2.9
Other operating costs (4,353) (4,688) (7.1)
Finance costs (615) (112) 449.1
Share of results of joint ventures 733 622 17.8
Share of results of associates 86 5,781 (98.5)
(Loss)/profit before taxation (1,819) 5,011 N.M
Income tax expense (46) (14) 228.6
(Loss)/profit for the period (1,865) 4,997 N.M
Other comprehensive income:  
Items that may be reclassified subsequently to profit or loss  
Foreign currency translation gain/(loss) 513 (402) N.M
Other comprehensive income for the year 513 (402) N.M
Total comprehensive income for the year (1,352) 4,595 N.M
(Loss)/profit attributable to:  
  Equity holders of the Company (1,598) 4,850 N.M
  Non-controlling interests (267) 147 N.M
  (1,865) 4,997 N.M
Total comprehensive income attributable to:  
  Equity holders of the Company (1,084) 4,526 N.M
  Non-controlling interests (268) 69 N.M
  (1,352) 4,595 N.M

N.M - Not meaningful

Balance Sheet

Non-current assets    
Property, plant and equipment 37,620 38,816 42,979
Intangible assets 119 119 419
Investments in subsidiaries - - -
Investments in associates 16,231 16,145 10,162
Investment in a joint ventures 2,707 2,003 -
Deferred tax assets - - 424
Trade receivables 8,146 6,073 7,355
Loans to associates - - 20,136
Loans to a joint venture 25,455 24,537 20,525
  90,278 87,693 102,000
Current assets      
Trade receivables 28,154 26,109 38,157
Loans to an associate 13,490 13,490 -
Amounts due from subsidiaries - - -
Contract assets 20,790 27,604 17,975
Development property 104,912 104,705 -
Properties held for sale 1,159 1,057 9,463
Investment securities 13 - -
Inventories 8,172 6,093 7,343
Other receivables 5,426 5,763 2,458
Pledged deposits 5,084 4,962 4,657
Cash and bank balances 28,296 30,435 58,730
Income tax recoverable 7 510 -
  215,503 220,728 138,783
Total assets 305,781 308,421 240,783
Current liabilities      
Amounts due to subsidiaries - - -
Contract liabilities 20,047 15,068 29,359
Trade and other payables 35,949 42,179 44,372
Deferred income 170 168 162
Other liabilities 4,514 4,209 2,142
Loans and borrowings 1,647 1,607 3,201
Income tax payable 682 1,026 4,679
  63,009 64,257 83,915
Net current assets 152,494 156,471 54,868
Non-current liabilities    
Trade and other payables 3,783 3,447 5,699
Deferred income 2,912 2,929 2,992
Deferred tax liabilities 245 308 239
Loans and borrowings 99,132 99,428 14,710
  106,072 106,112 23,640
Total liabilities 169,081 170,369 107,555
Net assets 136,700 138,052 133,228
Equity attributable to equity holders of the Company    
Share capital 49,082 49,082 43,967
Treasury shares (566) (566) (69)
Retained earnings 87,146 88,744 85,590
Foreign currency translation reserve 876 362 -
  136,538 137,622 129,488
Non-controlling interests 162 430 3,740
Total equity 136,700 138,052 133,228

Review of Performance

Income Statement Review – First Quarter 2018 ("1Q2018") vs First Quarter 2017 ("1Q2017")

The Group achieved revenue of S$40.7 million in 1Q2018 which was an improvement of S$11.2 million or 37.8% over S$29.5 million achieved in 1Q2017. The increase was underpinned by higher revenue from the Specialised Engineering Segment which mitigated the impact of lower revenue from the General Construction Segment and the Property Development Segment which did not register any sales this quarter as all development units were sold.

Gross profit margin was reduced from 16.5% to 9.1% as in this current quarter due to different project mix and generally more competitive margins.

Other operating income decreased by 22.3% due to lower interest and equipment rental income over the two quarters in comparison. Other expense which comprised foreign exchange differences and fair value gain or loss on derivatives amounted to a gain of S$0.1 million in 1Q2018 as compared to a loss of 0.2 million in 1Q2017.

Administrative costs increased marginally by 2.9% over the two quarters in comparison. Other operating costs were down by 7.1% as an allowance for inventory obsolescence of S$0.3 million was made in 1Q2017.

Finance cost increased by S$0.5 million as interest was incurred on the term loan obtained from the bank to finance for the purchase of Goh & Goh Building.

Share of results of joint ventures of S$0.7 million was mainly from the progressive recognition of income from the sale of condominium units of The Wisteria.

Share of results of associates for the period was considerably reduced as the profits from the sale of Lake Life Executive Condominium were almost entirely recognised in the last financial year.

The Group had a loss attributable to equity holders of the Company of S$1.6 million for 1Q2018.

Statement of Financial Position and Cash Flow Review

The Group's total assets decreased from S$308.4 million to S$305.8 million and total liabilities decreased from S$170.4 million to S$169.1 million.

Contract assets decreased by S$6.8 million as revenue recognised on contracts with customers were billed subsequent to the last financial year end. Consequently the current and non-current trade receivables which includes retention receivables, also increased.

Contract liabilities increased by S$5.0 million as there were excess of progress billings over revenue recognised on other projects.

Current trade and other payables decreased by S$6.2 million following payment settlement to suppliers and subcontractors subsequent to the last financial year end.

In the current quarter, the Group used S$0.2 million in operations. Net cash used in operating activities amounted to S$1.1 million after interest and income tax payments. The Group had also extended a further loan of S$0.8 million a joint venture for its property development project. Repayment of bank borrowings and finance leases amounted to S$0.4 million. As a result, cash and cash equivalents decreased by S$2.3 million for the current quarter.

The Group's cash position remained healthy at S$28.3 million as at 31 March 2018.


On 13 April 2018, the Ministry of Trade and Industry announced that based on advance estimates, the Singapore economy grew by 4.3 per cent on a year-on-year basis in the first quarter of 2018, higher than the 3.6 per cent growth in the fourth quarter of last year. The construction sector contracted by 4.4 per cent on a year-on-year basis in the first quarter, extending the 5.0 per cent decline in the previous quarter. The weak performance of the sector was due to a fall in both private sector and public sector construction activities.

The industry outlook remains challenging in the next 12 months with increasing competition, labour shortages and rising business costs. Although the construction demand is expected to improve due to the anticipated increase in public sector projects, the construction sector currently remains weak. With intense competition, tenders will continue to be challenging in the near term and bid prices will remain competitive at compressed margins.

The Group will continue to focus on its core businesses by leveraging its strong track record in building construction and civil engineering to secure more projects, as well as enhancing cost effectiveness and efficiency optimisation in the management of on-going projects.

On the re-development of Goh & Goh Building, the Group is still in discussions with the relevant authorities to optimise the potential of the development site. The Wisteria, a mixed development project under joint venture arrangement, is expected to obtain its Temporary Occupancy Permit ("TOP") in 2018.

The Group will continue to explore business opportunities both locally and in the region to maintain and sustain its long term growth.

As at the date of this announcement, the Group has an order book of approximately S$184 million in respect of construction projects, predominantly in Singapore and Malaysia.