Sin Heng Heavy Machinery Limited

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Financials
Third Quarter Results Financial Statement And Related Announcement
Financials Archive

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Profit & Loss

 

Review of Performance

Income Statement

Revenue

The Group registered total revenue of S$22.8m for 3rd Quarter ended 30 September 2018 ("3Q FY2018") which was 20.0% higher than that of 3rd Quarter ended 30 September 2017 ("3Q FY2017"). Total revenue of S$66.5m for 9M FY2018 was 9.4% higher as compared to 9M FY2017, mainly due to higher trading revenue and lower rental revenue.

Revenue from Equipment Rental business decreased by 21.8% to S$9.7m in 3Q FY2018 and 10.6% to S$31.3m in 9M FY2018 as compared to the corresponding periods in FY2017 respectively, mainly due to lower rental of fleets and decrease in rental rates.

Revenue from Trading business increased by 98.2% to S$13.1m in 3Q FY2018 and 36.7% to S$35.2m in 9M FY2018 as compared to the corresponding periods in FY2017 respectively, mainly due to an increase in number of cranes delivered in 3Q FY2018.

In 9M FY2018, there was a reclassification of servicing income from "Other Operating Income" to "Revenue." Comparative figures for 9M FY2017, were reclassified accordingly.

Gross Profit

The Group registered total gross profit of S$3.6m in 3Q FY2018, which was 20.2% lower than 3Q FY2017. Total gross profit for 9M FY2018 was S$11.7m and 10.6% lower as compared to 9M FY2017.

Gross profit from Equipment Rental business decreased by 37.3% to S$2.4m in 3Q FY2018 and 13.8% to S$8.5m in 9M FY2018 as compared to the corresponding periods in FY2017, mainly due to lower rental revenue and rental rates.

Gross profit from Trading business increased by 62.9% to S$1.3m in 3Q FY2018 and decreased by 1.2% to S$3.3m in 9M FY2018 as compared to the corresponding periods in FY2017, mainly due to an increase in number of cranes delivered in 3Q FY2018.

Net Profit / (Loss)

The Group registered net loss of S$2.76m in 9M FY2018. This was mainly due to the net impact of the following:

  1. lower gross profit generated from equipment rental revenue and trading revenue;

  2. realised and unrealised foreign exchange loss in 3Q FY2018;

  3. higher provision for doubtful debts made in 3Q FY2018;

  4. Inventory written off in 3Q FY2018;

  5. Property, plant and equipment written off in 3Q FY2018;

  6. lower selling and administrative expenses.

  7. higher income tax expenses as a result of income tax adjustments;

Statement Of Financial Position

Current assets
As at 30 September 2018, current assets amounted to S$63.5m or 35.4% of total assets. Current assets comprised mainly cash and bank balances, trade and other receivables and inventories. Total current assets increased by S$4.4m as compared to 31 December 2017 mainly due to increase in trade and other receivables and inventories.

Non-current assets
As at 30 September 2018, non-current assets amounted to S$116.0m or 64.6% of total assets. Non-current assets comprised mainly property, plant and equipment. Total non-current assets decreased by S$17.9m mainly due to a decrease in rental fleet and depreciation charged for the period.

Current liabilities
As at 30 September 2018, current liabilities amounted to S$34.4m or 56.7% of total liabilities. Current liabilities comprised mainly bills payable, trade and other payables, current portion of bank loans and finance leases. Total current liabilities decreased by S$2.1m as compared to 31 December 2017, mainly due to repayment of bank loans, decrease in trade payables and increase in bills payable.

Non-current liabilities
As at 30 September 2018, non-current liabilities amounted to approximately S$26.3m or 43.3% of total liabilities. Non-current liabilities comprised mainly non-current portion of finance leases and deferred tax. Total non-current liabilities decreased by S$8.6m as compared to 31 December 2017, mainly due to repayment of bank loans and finance leases.

Working Capital
As at 30 September 2018, the Group registered a positive working capital of S$29.1m as compared to S$22.6m as at 31 December 2017.

Equity
As at 30 Septenber 2018, the Group's equity decreased by S$2.8m to S$118.8m as compared to S$121.6m as at 31 December 2017, mainly due to total comprehensive loss recorded for 9M FY2018.

Commentary On Current Year Prospects

The Group expects the business environment to remain competitive and continues to manage costs.

Balance Sheet

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