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The Group's revenue was S$14.8 million for HY2018 representing a decrease of 11.2% or S$1.9 million from HY2017 revenue of S$16.7 million.
Project Sales showed a decline of 6.4% or S$0.3 million from S$4.8 million in HY2017 to S$4.5 million in HY2018. There are sales cycles with Project Sales Segment and the group is experiencing various tender stages for all our markets. Project Management and Maintenance Services showed a decline of 13.1% from S$11.9 million in HY2017 to S$10.3 million in HY2018, a decrease of S$1.6 million.
Although, the Group had secured approximately S$34.5 million in contracts in the first half of 2018, these new projects only commence in mid-May and the initial revenue contributions from these contracts were unable to cover the operating costs for the period, resulting in the loss. Revenue contributions from these projects are expected to increase in 2HY2018.
The Group's revenue decreased 11.2% from S$16.7 million in HY2017 to S$14.8 million in HY2018.
Project Sales revenue was S$4.5 million decreased by 6.4% or S$0.3 million from the previous period (S$4.8 million). Projects sales segment are currently at the tender stage for all our markets.
Revenue contribution from Project Management and Maintenance Services decreased by 13.1% or S$1.6 million, due mainly to delay by customer till midMay 2018 in the implementation of the project leading to this reduction in revenue in this segment.
The Group posted a gross profit of S$2.3 million in HY2018, representing a decrease of 58.1% from S$5.4 million reported in HY2017.
Gross profit from Project Sales decreased by 80.9% from S$1.4 million in HY2017 to S$0.3 million in HY2018. There were some delays in mobilisation of projects and as these projects have now started we will expect improvement in the 2HY2018.
Gross profit from Project Management and Maintenance Services decreased by 49.8% from S$4.0 million in HY2017 to S$2.0 million in HY2018. This was attributable to the lower revenue generated resulting from the delay in implementation of the project where direct and fixed cost had been incurred.
Equipment and consumables
Equipment and consumables increased by 11.2% from S$11.5 million in HY2017 to S$12.8 million in HY2018. The increase was incurred to meet projects commencement for the period.
Freight charges increased by 80.0% from S$40,000 in HY2017 to S$72,000 in HY2018. The increase due mainly to more overseas projects instead of local projects in the Project Sales segment.
Commission and consultancy
Commission and consultancy increased from S$10,000 in HY2017 to S$0.3 million in HY2018. The increase is in line with increased overseas project completions as mentioned in the previous paragraph.
Changes in inventories and contract work-in-progress
Changes in inventories and contract work-in-progress increased by 116.8% from S$0.2 million in HY2017 to S$0.5 million in HY2018. The increase reflects our expectation that more projects will be completed in the second half of the financial year.
With lesser deposits placed with financial institutions, interest income from bank deposits decreased from S$16,000 in HY2017 to S$13,000 in HY2018.
Other gain/ (losses) - net
Other gains/ (losses) decreased by 398.5% from a loss of S$0.1 million in HY2017 to a gain of S$0.4 million in HY2018. This was due to higher foreign exchange gains.
Distribution and marketing expenses
Distribution and marketing expenses decreased by 13.0% from S$23,000 in HY2017 to S$20,000 in HY2018.
Administrative expenses decreased by 3.2% from S$4.6 million in HY2017 to $4.5 million in HY2018. This was mostly due to a decrease in manpower based on the expected requirement for the financial year to cater for the project management services which is labour intensive.
Finance expenses decreased by 50.0% from S$128,000 in HY2017 to S$64,000 in HY2018. This was due to a decrease in borrowings at the beginning of the year.
Cash and cash equivalent
Cash and cash equivalents increased from S$7.4 million as at 31 December 2017 to S$9.6 million as at 30 June 2018. Please refer to paragraph (e) under the Statement of Cash Flow.
Trade and other receivables
Trade and other receivables decreased by S$10.7 million from S$42.8 million as at 31 December 2017 to S$32.1 million as at 30 June 2018. This is due to more effective collection of outstanding debts during the financial period.
Inventories increased marginally from S$348,000 as at 31 December 2017 to S$466,000 as at 30 June 2018 due to increase in materials stocked for project implementation in 2HFY2018.
Property, plant and equipment
Property, plant and equipment decreased by S$0.1 million from S$1.9 million as at 31 December 2017 to S$1.8 million as at 30 June 2018. This decrease was due to the purchase of plant and equipment totaling S$0.2 million which was offset by depreciation of S$0.3 million.
Trade and other payables
Trade and other payables decreased by S$6.4 million from S$13.9 million as at 31 December 2017 to S$7.4 million as at 30 June 2018. This is in accordance to agreed payment terms.
Current and non-current borrowings
Current and non-current borrowings decreased by S$0.5 million from S$20.6 million as at 31 December 2017 to S$20.1 million as at 30 June 2018, as a result of the Group's repayment of borrowings relating to project financing.
The Group recorded cash and cash equivalent of S$9.6 million at the end of HY2018. This was an increase of S$2.2 million from S$7.4 million as at the end of FY2017.
The Group's net cash provided by operating activities in HY2018 was S$3.0 million. Operating cash flow before working capital changes of S$1.3 million was mainly offset by changes in receivables of S$10.7 million and changes in payables of S$6.4 million.
The Group's net cash used in investing activities in HY2018 was S$13,000 for the purchase of office and site equipment.
The Group's net cash used in financing activities in HY2018 amounted to S$0.1 million, which was due to:-
The outstanding order book (contracts signed) as at 30 June 2018 is S$78.9 million. The majority of the Group's outstanding order book is in the Singapore, Vietnam and Myanmar, the Group's key markets.
The Group remains committed to seeking opportunities for continued growth and to building recurring and sustainable revenues in the existing key markets of Singapore, Myanmar and Vietnam.