Enviro-Hub Holdings Ltd

 

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Full Year Results Financial Statement And Related Announcement

Financials Archive

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Unaudited Full Year Financial Statements Announcement

Consolidated Statement Of Comprehensive Income For The Fourth Quarter And Year Ended 31 December 2016

Balance Sheet

Review Of Performance

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

Comparing 31 December 2016 with 31 December 2015 figures:

  1. The decrease in property, plant and equipment was due mainly to depreciation in FY2016.

  2. The decrease in investment properties was attributed mainly to fair value losses from strata industrial units held at 63 Hillview Avenue, Lam Soon Industrial Building and the reclass of two strata industrial units to assets held for sale. The decrease was partially offset by the fair value gain from PoMo, the commercial building at 1 Selegie Road.

  3. Current and non-current trade and other receivables was lower due mainly to lower construction related receivables recorded by Leong Hin Builders Pte Ltd relating to the joint operation with SB Procurement Pte Ltd (as announced via SGXNET on 18 May 2014) for the construction of a 7-storey multi-user general industrial development located at 60 Jalan Lam Huat, Singapore, as receivables were collected.The slower piling business at the back of fewer on-going piling projects during FY2016 also contributed to the lower trade and other receivables.

  4. The decrease in inventories was due mainly to reduced level of materials held by the recycling business.

  5. The decrease in cash and cash equivalents was mainly due to repayment of loans and loan interest payments, the decrease was partially offset with net operations receipts, proceeds from other investment, disposal of plant and equipments and loans received from related party and related company.

  6. QF 1 Pte Ltd is a wholly owned subsidiary of the Group's 51% owned subsidiary, EH Property & Investments Pte Ltd, had entered into a sales and purchase agreement to dispose two strata industrial units at 63 Hilview Avenue during 4Q 2016. As a result these properties has been reclassified into assets held for sales.

  7. The increase in short term loans and borrowings and decrease in long term loans and borrowings were due mainly to the reclassification of $30 million term loan between current and non-current liabilities that is due in 3Q2017. The increase in short term loans and borrowings was offset by repayment of trust receipts whereas the decrease of long term loans and borrowings was further reduced by repayment of loans during the financial year.

  8. Trade and other payables were higher due mainly to loan proceeds received from related party and related company.

  9. As at 31 December 2016, the Group's current liabilities exceeded its current assets by $57.4 million. Notwithstanding this, the financial statements of the Group have been prepared on a going concern basis because the Board of Directors, having assessed the financial position and funding options of the Group, believes that the Group has adequate resources to continue as a going concern for the foreseeable future. The liquidity requirements of the Group are expected to be met from cash inflows from operating activities, proceed from disposal of other investments, and continued financial support from the major shareholder of the Company.The Group will monitor and manage financial position closely in meeting its commitments when fall due.

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

Comparing FY2016/4Q 2016 figures with FY2015/4Q 2015 figures:

  1. For FY2016,revenue decreased by $10.3 million or 9% from $114.1 million to $103.9 million. The decrease in revenue was due mainly to the drop in trading of low margin recycling materials and slower piling business. However,the decrease was partially negated by higher revenue recorded from the Group's joint operation with SB Procurement Pte Ltd(as announced via SGXNET on 18 May 2014) under the construction business. Revenue from the joint operation was first recognised in 2Q 2015.

    For 4Q 2016, revenue decreased by $4.5 million or 16% from $28.9 million to $24.4 million due mainly to lower sales from low margin recycling materials.

  2. Gross profit for FY2016 improved by $6.2 million or 41% from $15.1 million to $21.3 million, which was attributed mainly to the property investments and management, construction businesses. Gross profit from property investments and management was higher due mainly to property tax refund in respect of prior year during 1Q2016, reduction in property tax expenses and improved in occupancy rates during FY2016 while the higher gross profit achieved by construction business is contributed by the joint operation with SB Procurement Pte Ltd(as announced via SGXNET on 18 May 2014), where revenue from the joint operation was first recognised from 2Q2015. The gross profit was further lifted by reduced gross loss incurred by the piling business as compared to FY2015.

    For 4Q2016,the increase in gross profit was attributed mainly to improved revenue and lower operating costs recorded by the property investments and management business.The increase was further attributed by higher sales margin secured by recycling businesses.

  3. Other income for FY2016 was decreased as compared to FY2015 mainly due to lower fair value gain from investment properties, the decrease was partially negated by gain on disposal of other investment and higher gain on disposal of plant and equipment.

    For 4Q 2016 was decreased as compared to 4Q 2015 was attributable mainly to the lower fair value gain from investment properties.

  4. The increase in other expenses for FY2016/4Q2016 was due mainly to fair value loss suffered from strata industrial units held at 63 Hillview Avenue, Lam Soon Industrial Building. This is partially negated by lower impairment losses on property, plant and machinery, the absence of impairment losses on other assets and intangible assets in the current financial year.

  5. For FY2016/4Q2016, general and administrative expenses were lower due to the absence of expenses related to proposed acquisitions in 2015, which were aborted (as announced via SGXNET on 3 November 2015), and general reduction in expenses.

  6. Selling and distribution expenses and finance costs for FY2016/4Q 2016 were generally comparable to FY2015/4Q 2015.

SEGMENT RESULTS

Comparing FY2016/4Q 2016 figures with FY2015/4Q 2015 figures:

  1. Revenue
    Trading of e-waste / metals business segment contributed $9.9 million or 10% and $23.2 million or 20% of the Group's revenue for FY2016 and FY2015,respectively. The decrease was due mainly to the reduction in sales of low margin materials in FY2016.

    Recycling and refining of metals business segment, which comprised the recycling, extraction and refining of Platinum Group Metals(PGM)and copper, contributed $33.0 millionor 32% and $36.1 million or 32% of the Group's revenue for FY2016 and FY2015, respectively. A slight decrease in revenue was due mainly to lower local sales in FY2016.

    Property investments and management business segment contributed $19.6 million or 19% and $18.5 million or 16% of the Group's revenue for FY2016 and FY2015, respectively. The increase was attributed to the improve of occupancy rates of strata industrial units held at 63 Hillview Avenue, Lam Soon Industrial Building and 1 Selegie Road, PoMo.

    Piling contract, construction, and rental and servicing of machinery business segment contributed $40.7 million or 39% and $35.8 million or 31% of the Group's revenue for FY2016 and FY2015, respectively. The increase was attributed to revenue contribution from the joint operation with SB Procurement Pte Ltd (as announced via SGXNET on 18 May 2014) for the construction of a 7-storey multi-user general industrial development located at 60 Jalan Lam Huat, Singapore, but was offset by the slowdown in piling business.

    Plastic to fuel refining business segment had not commenced operation.

  2. Profitability
    The trading of e-waste / metals and recycling and refining of metals business segments had improved from segmental profit of $0.9 million to $3.6 million. The improved performancewas attributed to better margins achieved, gain on disposal of plant and equipment and decrease in operating expenses during FY2016.

    Segment results from the property investments and management business segment decreased significantly from $20.2 million to $1.3 million due mainly to fair value loss suffered from the Group's strata industrial units held at 63 Hillview Avenue, Lam Soon Industrial Building, and a lower fair value gain on investment properties at 1 Selegie Road, PoMo was recognised in the current financial year.

    Segment results from the piling contract, construction, and rental and servicing of machinery business segment increased from $0.1 million to $2.7 million due mainly to higher revenue recorded from the Group's joint operation with SB Procurement Pte Ltd (as announced via SGXNET on 18 May 2014).

    The PTF refining business segment record a small losses of $0.5 million in FY2016 compare to $12.3 million in FY2015 due to absence of impairment losses on property, plant and equipment,intangible assets and other assets resulted from delay in the commencement of PTF refining mass production due to the slump in oil prices and instability of the globaleconomy in FY2015.

CONSOLIDATED STATEMENT OF CASH FLOWS

Comparing FY2016/4Q 2016 figures with FY2015/4Q 2015 figures:

  1. Net cash inflows from operating activities was higher in FY2016 compared to FY2015 due to improved performance achieved by the Group and changes in working capital.

    For 4Q 2016, net cash inflows from operating activities were relatively stable.

  2. Cash inflows from investing activities were higher in FY2016/4Q2016 compared to FY2015/4Q2015 due mainly to higher proceeds from disposal of property, plant and equipments, proceeds and deposit received from disposal of other investments.

  3. For 4Q 2016/FY2016, the increase in net cash outflows from financing activities was attributed to higher repayment of loans and borrowings and interest expenses.

Commentary On Current Year Prospects

Under the current uncertain economic environment, the Group will continue to control operating costs, improve productivity and rationalise its operations.