Financial Performance - Total consolidated revenue for the year ended December 31, 2023, was $425.772 million, with significant contributions from Thailand ($166.925 million) and ROW ($200.198 million)[139]. - Total net sales for 2023 were $425.8 million, a decrease of $8.1 million or 1.9% from $433.9 million in 2022[191]. - Operating profit for 2023 was $1.5 million, representing a decrease of $6.5 million or 80.8% from $8.1 million in 2022[200]. - Revenue from the North Asia region decreased by $18.7 million or 24% from $77.3 million in 2022 to $58.6 million in 2023[198]. - Revenue from the Thailand region decreased by $4.9 million or 3% from $171.8 million in 2022 to $166.9 million in 2023[198]. - Revenue from the ROW region increased by $15.5 million or 8% from $184.7 million in 2022 to $200.2 million in 2023[198]. - Gross profit decreased by $2.3 million or 7% from $32.5 million in 2022 to $30.2 million in 2023, with a gross profit margin of 7.1%[199]. - Finance costs increased by $0.9 million or 53% from $1.7 million in 2022 to $2.5 million in 2023[202]. - The impairment loss on financial and contract assets increased from $0.5 million in 2022 to $4.6 million in 2023[201]. - Income tax expense was $0.2 million in 2023, compared to $2.8 million in 2022, due to increased deferred tax assets[205]. Revenue Breakdown - Revenue from power cable products in 2023 was $221.075 million, a decrease from $182.171 million in 2022[139][140]. - Enameled wire revenue in 2023 was $137.441 million, compared to $178.124 million in 2022, indicating a decline in sales[139][140]. - Revenue for the year ended December 31, 2022, was $433.9 million, a decrease of $42.8 million or 9.0% from $476.7 million in 2021[207]. - Revenue from the North Asia region decreased by $30 million, or 28%, from $107 million in 2021 to $77.3 million in 2022, primarily due to decreased sales volume[212]. - Revenue from the Thailand region decreased by $25.9 million, or 13%, from $197.8 million in 2021 to $171.8 million in 2022, attributed to decreased sales to the public sector and currency depreciation[212]. Capital Expenditures - In 2023, total capital expenditures amounted to $4.3 million, primarily for the purchase of production machinery and equipment in North Asia[132]. - The company expects capital expenditures in 2024 to be $0.7 million, contingent on market conditions, funded by operational cash flow[133]. Market and Customer Insights - APWC operates through three reporting segments: Thailand, North Asia, and ROW, with a focus on manufacturing and distributing enameled wire, power cable, and telecommunications products[138]. - The company’s major customers include appliance component manufacturers and electrical contracting firms, indicating a diverse customer base[136]. - The company anticipates modest demand for medium and high voltage power cables due to ongoing infrastructure projects in Singapore[163]. - Political instability in Thailand has impacted infrastructure development, affecting local sales and prompting the company to seek overseas markets[181]. Supply Chain and Production - The price of the company's products is heavily influenced by copper prices, which are based on the average prevailing international spot market prices on the LME[165]. - The company maintains a few weeks supply of copper rods and cathodes and has long-term contracts with suppliers to mitigate supply risks[167]. - The company produces armored and unarmored low-voltage power cables with voltage capacities ranging from 300 volts to 1 kilovolt[159]. - Telecommunications cables manufactured by the company include copper-based and fiber optic cables, with capacities ranging from 25 to 3,000 pairs of 0.4 mm-diameter wires to 10 to 600 pairs of 0.9 mm-diameter wires[161]. - The wire and cable industry in the Asia Pacific region is highly competitive, with the company being one of the five largest producers in Thailand[175]. - The company has diversified its copper purchases among several suppliers to ensure advantageous pricing[168]. Employee and Management Information - As of December 31, 2023, the company employed a total of 1,210 employees, with administrative and management personnel accounting for 15.5%[251]. - The aggregate compensation for all directors and senior management members in 2023 was approximately $2 million[246]. - Each independent director received an annual fee of $30,000, while other directors received $20,000, plus reimbursement for travel expenses[246]. - The company has never experienced a strike or disruption due to labor disputes, indicating satisfactory employee relations[254]. - The company’s employee distribution by region as of December 31, 2023, was 63.6% in Thailand, 18.6% in North Asia, and 17.8% in ROW[251]. Shareholder and Dividend Information - The company has not paid dividends since 2019, with future dividend payments dependent on distributions from subsidiaries[137]. - The company has not paid any dividends since 2019, and does not anticipate paying dividends in 2024 due to funding needs and business performance[267]. - The rights offering in January 2022 raised gross proceeds of approximately $8.3 million, resulting in an increase of issued and outstanding shares from 13,819,669 to 20,616,227[275]. - The total number of Common Shares issued as of December 31, 2023, was 20,627,327, with 20,616,227 shares outstanding[272]. - Holders of Common Shares are entitled to one vote per share, with no cumulative voting rights, and must pay all calls or sums due to vote[281][286]. Related Party Transactions - APWC engages in transactions with PEWC, including the purchase of copper rod at prices based on the LME spot price plus an agreed premium[320]. - In 2023, there were no material changes to the Composite Services Agreement between APWC and PEWC[321]. - APWC has the right to distribute wire or cable products manufactured by PEWC in all current and future markets where it develops distribution capabilities[322]. - PEWC agrees to provide APWC with certain services and technology related to wire and cable product design and manufacturing[324]. Tax and Regulatory Information - The summary discusses U.S. federal income tax and Bermuda tax consequences related to the acquisition, ownership, and disposition of Common Shares[328]. - There is no comprehensive income tax treaty between the United States and Bermuda, which may affect tax consequences[329]. - Special tax rules may apply to certain classes of holders, including dealers in securities and tax-exempt organizations[331].
Asia Pacific Wire & Cable(APWC) - 2023 Q4 - Annual Report