Financials

CONDENSED INTERIM FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED 30 JUNE 2024

Financials Archive

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Condensed Interim Consolidated Statement Of Comprehensive Income

Condensed Interim Statements Of Financial Position

Review Of The Performance

Financial Performance of the Group (1H2024 vs 1H2023)

Electrical and Technical Supply

For 1H2024, revenue from the Electrical and Technical Supply Division increased by $2.6 million as compared to 1H2023 as the industry continues to recover in the level of activities, with the resumption of operations by shipyards in Singapore and in the region.

Security

The Security Division comprises Infrared and Thermal Sensing Technology and Cyber Security businesses. Revenue from this division decreased by $1.6 million mainly due to decrease in revenue of $1.5 million from Cyber Security and decreased in revenue of $0.1 million from Infrared and Thermal Sensing Technology.

Integration Engineering

The decrease in revenue for the Integration Engineering Division by $0.6 million is attributed to decrease in recognition of project revenue.

Gross profit

The Group's overall gross profit remains comparatively unchanged for 1H2024 as compared to 1H2023, decreasing marginally by $92k from $11.9 million in 1H2023 to $11.8 million in 1H2024.

Other operating income

Other operating income increased by $0.17 million from $0.52 million in 1H2023 to $0.70 million in 1H2024 mainly due to higher foreign exchange gain.

Operating expenses

Selling & Distribution expenses increased by $0.7 million, from $6.8 million in 1H2023 to $7.5 million in 1H2024, mainly due to increase in personnel related and research and development costs offset by a lower write-down of inventory.

Both administrative expenses and finance cost remain comparatively unchanged.

Share of results of joint ventures

The increase in share of profits of joint ventures was due to higher profits recorded by the Group's joint ventures for 1H2024.

Share of results of associated companies

The decrease in share of losses of associated company was due to lower losses incurred by the Group's associated companies for 1H2024.

Net profit for the period

The Group registered a lower net profit of $0.5 million mainly due to increase in selling and distribution expenses.

Financial Position of the Group

Inventories

Inventories increased by $5.4 million from $30.7 million as at FY2023 to $36.1 million as at 1H2024, mainly due to increase in Electrical and Technical Supply of $5.7 million; offset by decrease in Integration Engineering Division $0.3 million.

Trade receivables

Trade receivables decreased by $1.2 million from $16.3 million as at FY2023 to $15.0 million as at 1H2024. This is mainly due to decrease in Electrical and Technical Supply by $1.2 million as a result of faster collection.

Trade payables

Trade payables increased by $2.6 million from $5.5 million as at FY2023 to $8.2 million as at 1H2024 as a result of higher purchases.

Borrowings

Overall increase in total bank borrowings (current and non-current) of $2.7 million mainly due to working capital loan net drawdown of $3.5 million offset by repayment of term loan of $0.8 million.

Cash flow review (1H2024 vs 1H2023)

As a result of higher working capital requirements, cash used in operating activities for 1H2024 was $1.9 million, as compared to net cash from operating activities of $3.8 million in 1H2023.

The net cash flows used in investing activities for 1H2024 was $0.5 million, mainly due to development costs incurred and purchase of property, plant and equipment offset against dividend received from joint venture.

The net cash from financing activities was mainly due to net drawdown of short-term borrowings of $3.5 million offset against dividend paid to shareholders $2.1 million for 1H2024 and repayment of bank borrowings $0.8 million.

Commentary

Outlook

The Maritime industry continues to adapt to disruptions from geopolitical tensions, trade policies and IMO (International Maritime Organisation) regulations, which have highlighted the need for more resilient supply chains. Maritime routes and trade flows continue to be impacted by changing geopolitical landscapes, including the Middle-East conflicts, and shifting alliances.

The integration of digital technologies, such as AI, IoT, and blockchain, is enhancing operational efficiency, safety, and transparency in maritime. However, increasing cyber-attacks on critical infrastructures mandates that it is critical for transportation and shipping organisations to strengthen their defences. This creates opportunities for our Cyber-Security Division.

The drive towards the Green Sustainability and Decarbonization in the shipping industry has seen new regulatory requirements that impact our businesses but at the same time present new opportunities for us to pursue. Our initiatives include but are not limited to Green LED retrofitting, Vessel Electrification, Green Energy storage and GRE piping solutions.

The maritime industry is poised for growth and transformation as it navigates these challenges and opportunities.