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Financials

Unaudited Financial Statements and Related Announcement for the First Quarter and Three Months ended 30 September 2017

Financials Archive

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Consolidated Statement of Comprehensive Income

Profit & Loss

Balance Sheet

Balance Sheet

Review of Performance

STATEMENT OF COMPREHENSIVE INCOME

1QFY2018 vs 1QFY2017

Revenue

1QFY2018 vs 1QFY2017

The Group posted revenue of approximately S$3.47 million in 1QFY2018 as compared to S$15.47 million in the previous corresponding period in 1QFY2017. The revenue derived in this quarter came solely from property investment which increased by 26.8% as compared to the corresponding period in 1QFY2017. No revenue was reported in this quarter from the property development segment and construction services segment.

Gross Profit ("GP") / Gross Profit Margin ("GPM")

1QFY2018 vs 1QFY2017

As a result of lower revenue reported, the Group recorded gross profit of approximately S$1.95 million in 1QFY2018, as compared to S$4.14 million in 1QFY2017. Comparatively, the gross profit margin of 56.2% from the property investment segment in 1QFY2018 is much higher than that of 26.8% achieved in 1QFY2017 due to higher occupancy in the Group's investment properties.

Other income

1QFY2018 vs 1QFY2017

Other income for 1QFY2018 was higher at approximately S$1.67 million as compared to S$0.07 million in 1QFY2017. The increase was largely attributed to one-off income derived from the sale of assets held for sale.

General and Administrative Expenses

1QFY2018 vs 1QFY2017

General and administrative expenses for the period decreased from approximately S$3.03 million in 1QFY2017 to S$2.08 million in 1QFY2018. The factors contributing to the reduction were largely due to lower bank charges, depreciation of fixed assets, property tax and staff and related costs. The overall reduction in general and administrative expenses was partially offset by increase in other expenses which, amongst others, higher professional fees and leasing commissions.

Finance Costs

1QFY2018 vs 1QFY2017

Finance costs decreased by 40.1% from approximately S$3.09 million in 1QFY2017 to S$1.85 million in 1QFY2019. The decrease was due mainly to lower outstanding bank loans.

Share of profits of associate

1QFY2018 vs 1QFY2017

There was no share of profits of associate for 1QFY2018 as the investments in associate has been classified as assets held for sale and the Group no longer equity account for the said investment.

Income Tax

1QFY2018 vs 1QFY2017

There was no income tax for the said quarter.

Loss for the period, net of tax

1QFY2018 vs 1QFY2017

As a result of the foregoing, the Group registered a lower net loss of approximately S$0.31 million in 1QFY2018 as compared to a loss of S$1.89 million in 1QFY2017.

STATEMENT OF FINANCIAL POSITION

As at 30 September 2017, total current assets stood at approximately S$146.90 million as compared to S$173.60 million as at 30 June 2017. The reduction in total current assets was attributed largely to completed properties held for sale, cash and cash equivalents and assets held for sale. The latter reflects the selling price of the Group's investments in PAL.

Total non-current assets increased to approximately S$151.78 million as at 30 September 2017 as compared to approximately S$142.85 million as at 30 June 2017. The increment was attributed solely to an increase in investment properties from approximately S$129.58 million to approximately S$138.64 million.

As at 30 September 2017, total current liabilities reduced to approximately S$141.66 million as compared to approximately S$164.83 million as at 30 June 2017. This was a result of repayment in bank loans and a reduction in total trade and other payables. In addition, the reduction in current liabilities was also due to a re-classification of a bank loan from current liabilities to non-current liabilities. The overall reduction in current liabilities was partially offset by the additional loan from third party taken up during the period under review and a re-classification of loan from controlling interests from non-current liabilities to current liabilities.

Total non-current liabilities increased to approximately S$69.63 million as at 30 September 2017 as compared to approximately S$63.93 million as at 30 June 2017. The increase was mainly due to a reclassification of a bank loan from current liabilities to non-current liabilities.

STATEMENT OF CASH FLOWS

Net cash outflow/inflow from operating activities

For the financial period 3 months ended 30 September 2017, the Group generated net cash outflow from operating activities of approximately S$8.11 million as compared to a net cash inflow of approximately S$5.31 million in 1QFY2017. The net cash outflow was primarily due to repayment in trade and other payables and income tax paid.

Net cash inflow/outflow in investing activities

The Group recorded net cash inflow of approximately S$8.81 million for 1QFY2018 from investing activities as compared to net cash outflow of approximately S$17.40 million in the corresponding period last year. The net cash inflow in 1QFY2018 related mainly to the proceeds received from the disposal of assets held for sale.

Net cash outflow from financing activities

The Group recorded net cash outflow of approximately S$5.29 million from financing activities in 1QFY2018 as compared to a net cash outflow of S$7.92 million in the corresponding period last year. The net cash outflow was largely due to the repayment of bank loans.

As a result of the above, the Group recorded a net decrease in cash and cash equivalents of approximately S$4.60 million in 1QFY2018.

Cash and cash equivalents as at 30 September 2017 stood at (including bank overdraft and fixed deposits pledged that totalled approximately S$3.72 million) approximately S$6.19 million.

Commentary

Notwithstanding the current state of the industrial real estate market in Singapore, the Group has started looking for attractive industrial land for development opportunities. Given its success in Addition & Alteration ("A&A") works and rental income from its Kim Yam Road, Herencia property, the Group will continue to look out for opportunities to undertake A&A to similar buildings to generate a recurrent income stream. The Group will also be tapping on its business networks to pursue overseas businesses in the region.

The Group owns a diverse portfolio of development and investment properties as well as fixed assets. As part of its continuous review, the Group is assessing the relevance of the properties and fixed assets against its overall strategies. The Group may monetise some of these assets through sales so as to further strengthen the financial strength of the Group as it explores new business opportunities.

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