Financials

Full Year Results Financial Statement And Related Announcement

Financials Archive

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Consolidated Income Statement

Income Statement

Consolidated Statement of Other Comprehensive Income

Income Statement

Review Of Performance

INCOME STATEMENT – Comparing 4Q2016 to 4Q2015

The Group's revenue increased by 12.3% from US$222.9 million to US$250.2 million, and gross profit increased by 11.6% from US$13.2 million to US$14.8 million, which were due to higher sales from the Hong Kong and Singapore business units arising from stronger demand.

Other income increased by 64.1% from US$117,000 to US$192,000 mainly due to income received in 4Q2016 following the divestment of the non-core research and development division in FY2014.

Sales and distribution costs increased by 8.0% from US$7.3 million to US$7.9 million, and general and administrative expenses increased by 13.7% from US$3.3 million to US$3.7 million. These were mainly due to net foreign exchange loss arising from the translation of balances denominated in foreign currencies into functional currency and higher staff costs.

Included in other expenses was net write-back of allowance for doubtful trade debts of US$0.5 million in 4Q2016 due to the recovery of trade debts, and net allowance for doubtful trade debts of US$O.B million in 4Q2015.

Interest expense increased by 49.2% from US$0.5 million to US$O.8 million mainly due to higher borrowings arising from the increase in working capital requirements.

Overall, the Group reported an increase in profit after taxation by 128.2% from US$1.1 million to US$2.6 million.

CASHFLOW – Comparing 4Q2016 to 4Q2015

The Group's net cash flows generated from operating activities was US$3.8 million compared to net cash flows used in operating activities of US$3.4 million in 4Q2015, mainly due to higher collection from trade debtors.

The Group's net cash flows used in investing activities was US$1.1 million compared to US$0.1 million in 4Q2015, mainly due to the purchase of computers and furniture and fittings by US$0.9 million to support the business growth.

The Group's net cash inflows generated from financing activities was US$6.2 million compared to US$6.4 million in 4Q2015, mainly due to the increase in interest-bearing loans and borrowings by US$0.5 million and proceeds from issuance of ordinary shares of US$5.7 million.

INCOME STATEMENT – Comparing FY2016 to FY2015

The Group's revenue increased by 19.3% from US$828.3 million to US$988.2 million, and gross profit increased by 15.4% from US$47.7 million to US$55.1 million, which were due to higher sales arising from stronger demand in FY2016.

Other income decreased by 18.7% from US$0.7 million to US$0.5 million mainly due the decrease in income received in FY2016 that relates to the divestment of the non-core research and development division in FY2014.

Sales and distribution costs increased by 11.6% from US$26.7 million to US$29.8 million, and general and administrative expenses increased by 18.1% from US$13.3 million to US$15.7 million. These were mainly due to net foreign exchange loss arising from the translation of balances denominated in foreign currency into functional currency, higher rental and staff costs.

Included in other expenses was net write-back of allowance for doubtful trade debts of US$0.8 million in FY2016 due to the recovery of trade debts, and net allowance for doubtful trade debts of US$1.1 million in FY2015.

Interest expense increased by 38.4% from US$1.8 million to US$2.5 million mainly due to higher borrowings arising from the increase in working capital needs.

Overall, the Group reported an increase in profit after taxation by 62.0% from US$4.4 million to US$7.1 million.

CASH FLOW AND FINANCIAL POSITION – Comparing FY2016 to FY2015

The Group's net cash flows used in operating activities was US$20.4 million compared to US$16.3 million in FY2015, mainly due to the increase in the requirement for working capital by US$28.8 million.

The Group's trade debtors increased from US$135.2 million to US$154.2 million as at 31 December 2016. Stock increased from US$111.6 million to US$131.6 million as at 31 December 2016. The increases in trade debtors and stock were due mainly to the increase in sales.

Trade creditors and accruals increased from US$93.1 million to US$100.1 million as at 31 December 2016 due to higher purchase of stock.

Interest-bearing loans and borrowings increased from US$99.4 million to US$123.5 million as at 31 December 2016 to fund the working capital requirements.

The Group's cash and short term deposits was US$16.6 million as at 31 December 2016 as compared to US$10.7 million as at 31 December 2015.

Overall, shareholders' equity increased to US$68.3 million from US$57.2 million as at 31 December 2015, mainly due to the profit for the year of US$7.1 million and issuance of new shares of US$5.8 million. This was partially offset by the payment of dividends of US$1.9 million during the year.

Commentary

The market outlook for 2017 remains challenging, but in respect of the electronics industry, we continue to see opportunities coming from infrastructure projects by governments in China, India and the emerging markets we operate in. The recent Consumer Electronics Show held in Las Vegas in January 2017 showcased many exciting developments, which will fuel demand for solutions and applications especially in the Internet of Things. The Group will continue to explore partnerships and expand our product portfolio to enhance our position in the market. While we work on capturing these business opportunities, the Group remains focused at driving sustainable growth.

Balance Sheet

Balance Sheet