Financials

Full Year Results Financial Statement And Related Announcement


Financials Archive

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Income Statement

Balance Sheet

Review of Performance

Income Statement

In the twelve months financial year ended 31 March 2017 ("FY2017"), the Group registered a turnover of US$0.6 million. This represents a decline of 77% or US$2.1 million as compared to US$2.7 million for the comparative twelve months financial year ended 31 March 2016 ("FY2016"). The decline was mainly due to weak demand in the products and commodities of the Group as compared to FY2016. Gross profits for FY2017 remains as US$0.1 million compared to FY2016 of US$0.4 million.The turnover reported for FY2017 was from the Group's systems segment.

Other income was US$0.4 million for FY2017 as compared to US$1.1 million in FY2016. The decrease of US$0.7 million in FY2017 was due to lesser write back of trade and other payables and gain on expiration of warrants in FY2016.

Marketing and distribution expenses decreased by 63% from US$0.2 million in FY2016 to US$0.1 million in FY2017. Administration expenses decreased by 19% from US$2.1 million in FY2016 to US$1.7 million in FY2017 mainly due to reduction in staff incentive expenses and operating cost for the Group's systems segment. Finance costs remains unchanged at US$0.01 million for FY2017 and FY2016. Other charges decreased from US$1.0 million in FY2016 to US$0.8 million in FY2017 mainly due a decrease of exchange losses arising from the US dollar.

Balance Sheet

Non-current assets increased by 120% from US$12.3 million as at 31 March 2016 to US$27.1 million as at 31 March 2017. The increase is mainly due to the amounts owing from WE Components Group ("WEC") being formalised to a convertible loan and direct loan which was assigned to Jubilee Industries Holdings Ltd. ("JIH") from the sale of the former group of companies. This increase is offset by the investment in JIH for the latter's share of loss of US$1.0 million

Current assets as at 31 March 2017 comprised trade and other receivables, other assets, income tax receivable and cash and cash equivalents. Total current assets amounted to US$13.8 million as at 31 March 2017 as compared to US$28.9 million as at 31 March 2016. This is a decrease of US$15.1 million and is mainly attributable to the amount owing from WEC being formalised to a convertible loan and direct loan as mentioned above.

Current liabilities as at 31 March 2017 comprised income tax payable, trade and other payables and other financial liabilities. Total current liabilities amounted to US$3.3 million as at 31 March 2017 as compared to US$3.9 million as at 31 March 2016. The decrease of US$0.6 million is mainly due to an decrease in trade and other payables which is aligned to the decrease in expenses.

Non-current liabilities comprised deferred tax liabilities and other financial liabilities. Total non-current liabilities increased by 167% from US$1.6 million as at 31 March 2016 to US$4.4 million as at 31 March 2017. The increase is mainly due to the convertible loans obtained from Singapore Rixin Zhonghe Investment Pte. Ltd. in support of the new Corporate Accretion Services business focusing on education and financial technology sectors.

The Group had working capital of US$10.1 million as at 31 March 2017 as compared to US$25.0 million as at 31 March 2016. The decrease is in cash and cash equivalents and other receivables being formalised to a convertible loan and direct loan.

Cash Flow Statement

Net cash flow generated from operating activities for FY2017 was US$6.4 million, comprising operating loss before working capital changes of US$1.3 million and cash generated from operations of US$7.7 million. The working capital inflow was mainly due to the decrease in trade and other receivables of US$8.2 million. This decrease is offset by the decrease of trade and other payables of US$0.6 million. Net cash used in investing activities for FY2017 of US$0.002 million was mainly due to purchase of intangible assets. Cash used in financing activities is US$12.6 million mainly due to the convertible loan and direct loan mentioned above. The Group's cash and cash equivalent was US$3.2 million as at 31 March 2017 as compared to US$9.9 million as of 31 March 2016, a net decrease of US$6.7 million.

Commentary

The landscape of the Group's regional resources business has been challenging given the current climate of the economy. Due to this situation, the Group noted the need to explore new businesses for additional and viable streams of income. As such, the Group is venturing into the provision of Corporate Accretion Services focusing on the education and financial technology (i.e. crowdfunding and e-wallet) business. Showing support of the new business, an investor provided funding of S$4 million to the Company through a convertible loan. The Group noted that the operating environment would be challenging going forward and will explore opportunities to broaden the Group's reach in commodities and the new Corporate Accretion Services business. The Group will remain vigilant on cost, credit and cash management in response to the volatile operating environment as it carries out its expansion strategies.