中国新零售供应链(03928) - 2023 - 中期业绩

Financial Statements Interim Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income For the six months ended March 31, 2023, the Group achieved a turnaround to a profit of approximately SGD 0.3 million, compared to a loss of SGD 2.8 million in the prior year, driven by significant gross profit growth and increased other income. Performance Overview for H1 FY2023 vs H1 FY2022 | Indicator | Six Months Ended March 31, 2023 (SGD) | Six Months Ended March 31, 2022 (SGD) | | :--- | :--- | :--- | | Total Revenue | 31,885,141 | 30,744,905 | | Gross Profit | 1,786,156 | 641,341 | | Profit/(Loss) Before Tax | 27,111 | (2,795,857) | | Profit/(Loss) for the Period | 280,252 | (2,835,155) | | Basic and Diluted Earnings/(Loss) Per Share (SGD cents) | 0.06 | (0.59) | Interim Condensed Consolidated Statement of Financial Position As of March 31, 2023, total assets decreased to SGD 65.4 million from SGD 73.4 million due to reductions in non-current and contract assets, while net assets (total equity) slightly increased to SGD 29.3 million from SGD 29.0 million, indicating a stable capital structure. Financial Position Summary | Indicator | March 31, 2023 (SGD) | September 30, 2022 (SGD) | | :--- | :--- | :--- | | Non-current Assets | 27,711,605 | 31,947,656 | | Current Assets | 37,680,575 | 41,492,247 | | Total Assets | 65,392,180 | 73,439,903 | | Current Liabilities | 26,936,453 | 30,222,725 | | Non-current Liabilities | 9,179,358 | 14,221,061 | | Total Liabilities | 36,115,811 | 44,443,786 | | Net Assets | 29,276,369 | 28,996,117 | Management Discussion and Analysis Business Review and Outlook Despite an uncertain short-term economic outlook in Singapore, the construction sector showed strong 8.5% year-on-year growth in Q1 2023, with government projections for 2023 construction contract values between SGD 27 billion and SGD 32 billion, primarily driven by public housing and infrastructure projects. - Singapore's construction sector grew 8.5% year-on-year in Q1 2023, driven by increased public and private sector output[3] - The Building and Construction Authority forecasts 2023 construction contract values between SGD 27 billion and SGD 32 billion, with the public sector accounting for 60% of total demand, supported by public housing and infrastructure[4] - The Group maintains a cautious yet optimistic outlook, facing challenges from competition, geopolitical tensions, high interest rates, and inflationary pressures on raw materials and labor costs[5] Financial Review The Group's financial performance significantly improved in the first half of the fiscal year, achieving a turnaround to profitability with total revenue growing 3.9% to SGD 31.9 million, gross profit substantially increasing to SGD 1.8 million, and gross margin rising from 2.1% to 5.6%, primarily due to improved project cost overruns, property sale gains, and effective administrative expense control. Revenue Total revenue increased 3.9% year-on-year from SGD 30.7 million to SGD 31.9 million, primarily driven by the construction services segment due to increased activity following the easing of COVID-19 restrictions in Singapore, with construction services accounting for 99.1% of total revenue while property investment income remained stable. Total Revenue by Segment | Segment | H1 FY2023 Revenue (million SGD) | % of Total Revenue | H1 FY2022 Revenue (million SGD) | % of Total Revenue | | :--- | :--- | :--- | :--- | :--- | | Construction Services | 31.6 | 99.1% | 30.4 | 99.0% | | Property Investment | 0.3 | 0.9% | 0.3 | 1.0% | | Total | 31.9 | 100.0% | 30.7 | 100.0% | Gross Profit and Gross Margin The Group's gross profit significantly increased from SGD 0.6 million in the prior year to SGD 1.8 million, with the gross margin improving from 2.1% to 5.6%, primarily due to reduced COVID-19 related costs and improved project cost overruns. - Gross profit increased by SGD 1.2 million year-on-year, with gross margin rising from 2.1% to 5.6%[128] - The improvement in gross profit is mainly attributed to reduced COVID-19 related costs, leading to better control over project cost overruns[128] Other Income, Gains and Losses Other income decreased by SGD 0.4 million due to the cessation of government COVID-19 related subsidies, but net other gains significantly increased by SGD 1.1 million to SGD 1.4 million, primarily from a SGD 2.3 million net gain on the disposal of property, plant, and equipment, partially offset by exchange losses and losses from the disposal of a joint venture investment property. - Other income decreased by approximately SGD 0.4 million due to reduced government subsidies[129] - Net other gains increased by SGD 1.1 million, primarily from a SGD 2.3 million gain on property disposal[131] Expenses and Taxation Administrative expenses decreased by SGD 1.2 million to SGD 2.8 million year-on-year, mainly due to lower professional fees, machinery and vehicle expenses, and administrative staff costs, while income tax shifted from an expense to a credit of approximately SGD 0.3 million due to the refund of over-provisioned taxes from prior years. - Administrative expenses decreased by SGD 1.2 million, from SGD 4.0 million to SGD 2.8 million[134] - Income tax shifted from an expense of approximately SGD 0.04 million to a credit of approximately SGD 0.3 million, primarily due to prior year tax adjustments[138] Profit/(Loss) for the Period and Dividends The Group successfully turned around from a net loss of approximately SGD 2.8 million in the prior year to a net profit of approximately SGD 0.3 million, with the Board resolving not to declare an interim dividend for the first half of the fiscal year. - The Group turned from a net loss of SGD 2.8 million in H1 FY2022 to a net profit of SGD 0.3 million in H1 FY2023[139] - The Board does not recommend the payment of an interim dividend[140] Liquidity, Financial Resources and Capital Structure The Group maintains prudent financial management, with bank balances and cash of approximately SGD 8.8 million and total borrowings of approximately SGD 19.2 million as of March 31, 2023, while the gearing ratio significantly decreased from 87.6% to 65.7% primarily due to reduced bank borrowings, with certain assets pledged for bank financing. Key Capital Structure Indicators | Indicator | March 31, 2023 | September 30, 2022 | | :--- | :--- | :--- | | Bank Balances and Cash | Approx. SGD 8.8 million | Approx. SGD 9.0 million | | Total Borrowings | Approx. SGD 19.2 million | Approx. SGD 25.4 million | | Gearing Ratio | 65.7% | 87.6% | - The decrease in gearing ratio is primarily due to reduced bank borrowings, including those held under joint ventures[145] - The Group has pledged bank deposits, owner-occupied properties, investment properties, and investment properties held under joint ventures to secure bank financing, with a total carrying value of pledged assets exceeding SGD 21.9 million[146] Significant Investments The Group's significant investments primarily comprise investment properties held directly and through joint ventures, aiming to build a portfolio that provides stable recurring income and capital appreciation potential, though a net loss of SGD 0.3 million was recorded from the disposal of a joint venture investment property during the period. - The Group's investment strategy focuses on building an investment property portfolio to stabilize rental income, diversify construction industry risks, and achieve capital appreciation[105] Fair Value of Significant Investment Properties (as of March 31, 2023) | Investment Type | Fair Value (SGD) | | :--- | :--- | | Investment Properties | 10,213,000 | | Investment Properties Held Under Joint Ventures (Group's Share) | 4,440,000 | - During the reporting period, the Group disposed of a joint venture investment property for SGD 1.2 million, recording a loss of SGD 0.3 million[103] Other Matters This section covers employee information, use of IPO proceeds, and corporate governance, noting 197 employees at period-end, delayed utilization of some IPO proceeds due to economic uncertainty and a cautious approach, and compliance with corporate governance codes. Employees and Remuneration Policy As of March 31, 2023, the Group employed 197 staff, a slight decrease from 204 in the prior year, with total staff costs for the first half of the fiscal year amounting to approximately SGD 3.9 million, and remuneration policies are regularly reviewed to ensure market competitiveness for talent attraction and retention. Employees and Costs | Indicator | March 31, 2023 | March 31, 2022 | | :--- | :--- | :--- | | Number of Employees | 197 | Approx. 204 | | Total Staff Costs (H1) | Approx. SGD 3.9 million | Approx. SGD 4.2 million | Use of Net Proceeds from Share Offer Of the approximately HKD 86.3 million net proceeds from the IPO, HKD 66.4 million has been utilized as planned, with the remaining HKD 19.9 million (originally for BIM systems and investment property acquisition) unutilized due to economic uncertainty, a cautious financial approach, and the need for more time to select suppliers and suitable properties, with the balance expected to be utilized by September 30, 2023. Summary of Proceeds Utilization (million HKD) | Purpose | Planned Use | Amount Utilized | Unutilized Portion | | :--- | :--- | :--- | :--- | | Investment in Building Information Modeling and Enterprise Resource Planning Systems | 5.3 | 0 | 5.3 | | Acquisition of Investment Properties | 14.6 | 0 | 14.6 | | Total Unutilized | | | 19.9 | - Reasons for delayed utilization of proceeds include: (a) a cautious approach to cash preservation amidst the pandemic and economic slowdown; (b) requiring more time to screen suitable system suppliers; (c) needing more time to identify appropriate investment properties[115] Notes to the Financial Statements Company Information, Basis of Preparation and Accounting Policies The Company is an investment holding company incorporated in the Cayman Islands, with its subsidiaries primarily engaged in construction services and property investment in Singapore, and these unaudited interim condensed consolidated financial statements are prepared in accordance with International Accounting Standard 34 "Interim Financial Reporting," with consistent accounting policies from the previous audited financial statements. - The Company is an investment holding company, primarily engaged in construction services and property investment in Singapore[92] - The interim financial statements are prepared in accordance with International Accounting Standard 34 "Interim Financial Reporting"[16] Revenue and Segment Information The Group operates in two segments: construction services and property investment, with construction services being the core revenue source, accounting for over 99% of total revenue and primarily comprising civil engineering and building construction, while property investment provides stable rental income, with all operations and assets located in Singapore. Segment Results (Six Months Ended March 31) | Segment | 2023 (SGD) | 2022 (SGD) | | :--- | :--- | :--- | | Segment Revenue | | | | Construction Services | 31,608,291 | 30,452,505 | | Property Investment | 276,850 | 292,400 | | Segment Results (Gross Profit) | | | | Construction Services | 1,567,778 | 417,999 | | Property Investment | 218,378 | 223,342 | - The Group primarily operates in Singapore, with all revenue and non-current assets for the period originating from Singapore[88] Details of Assets and Liabilities This section details key balance sheet items, showing property, plant, and equipment with a net book value of SGD 10.7 million, investment properties and investment properties held under joint ventures totaling SGD 14.6 million in fair value, and decreases in trade receivables, contract assets, bank borrowings, and lease liabilities. Property, Plant and Equipment As of March 31, 2023, the net book value of property, plant, and equipment was SGD 10.7 million, a decrease from SGD 13.4 million as of September 30, 2022, primarily due to asset disposals and depreciation during the period. Net Book Value of Property, Plant and Equipment | Item | March 31, 2023 (SGD) | September 30, 2022 (SGD) | | :--- | :--- | :--- | | Net Book Value | 10,704,429 | 13,438,698 | Investment Properties The fair value of investment properties held directly by the Group remained stable at SGD 10.2 million, while the Group's share of investment properties held under joint ventures decreased from SGD 5.9 million to SGD 4.4 million due to the disposal of a property. Fair Value of Investment Properties | Item | March 31, 2023 (SGD) | September 30, 2022 (SGD) | | :--- | :--- | :--- | | Investment Properties | 10,213,000 | 10,213,000 | | Investment Properties Held Under Joint Ventures | 4,440,000 | 5,945,000 | Trade Receivables and Contract Assets Trade receivables decreased from SGD 8.3 million to SGD 5.9 million, and contract assets (primarily for completed but unbilled work and retention sums) also decreased from SGD 21.7 million to SGD 19.2 million, reflecting project progress and collection status. Receivables and Contract Assets | Item | March 31, 2023 (SGD) | September 30, 2022 (SGD) | | :--- | :--- | :--- | | Trade Receivables | 5,868,909 | 8,263,952 | | Contract Assets | 19,155,202 | 21,692,831 | Bank Borrowings and Lease Liabilities The Group's total bank borrowings (including bank overdrafts and joint venture borrowings) significantly decreased from SGD 22.8 million to SGD 17.2 million, and total lease liabilities also fell from SGD 2.6 million to SGD 2.1 million, indicating a reduction in the Group's overall debt level. Borrowings and Liabilities | Item | March 31, 2023 (SGD) | September 30, 2022 (SGD) | | :--- | :--- | :--- | | Bank Overdrafts and Bank Borrowings | 17,173,522 | 22,786,276 | | Lease Liabilities | 2,056,050 | 2,626,907 | Share Capital, Dividends and Earnings Per Share As of the period end, the company's issued share capital comprised 480 million ordinary shares with a total par value of HKD 4.8 million, consistent with the beginning of the period, with no dividends declared for the reporting period, and basic and diluted earnings per share significantly turning around to 0.06 SGD cents from a loss of 0.59 SGD cents in the prior year. - No dividends were declared by the company for the six months ended March 31, 2023[40] Earnings Per Share Calculation | Indicator | Six Months Ended March 31, 2023 | Six Months Ended March 31, 2022 | | :--- | :--- | :--- | | Profit/(Loss) for the Period Attributable to Owners of the Company (SGD) | 280,252 | (2,835,155) | | Weighted Average Number of Ordinary Shares in Issue | 480,000,000 | 480,000,000 | | Basic and Diluted Earnings/(Loss) Per Share (SGD cents) | 0.06 | (0.59) |