- Revenue declined from $78.7million to $73.8million.
- Net profit after tax declined from $3.7million to $1.9million
- Operations generated cash flow of $5.4million
- Cash within the Group is in excess of $22.5million
- Gearing stood at 0.03 times
SINGAPORE,
11 August 2008 -
Main board listed Teckwah Industrial Corporation Limited(“Teckwah” or “the Group”)
today announced revenues of $73.8million (1H FY2007: $78.7million) and net profit after tax of $1.9million (1H FY2007: $ 3.7million} for the first six-months ended 30 June 2008.
The performance of the Group in the first half of the current financial year saw the impacts of the global economic slow down and increase in production and operating costs as a result of inflation.
Both the Print and Non-Print business reported lower sales performance due to weaker demand and global consolidation initiatives by certain customers. Sales revenue from Print business declined by 5% to $61.3million while Non-Print business declined by 12% to $12.4million respectively. Geographically, sales contribution to the Group from the Singapore operations dropped from 58.9% to 52.3% while the China operations increased its contribution from 23.7% to 27.4 %.
The Group’s pretax operating profit declined from $4.8million (1H FY2007) to $2.5million mainly due to the lower sales and the higher cost of raw materials during the period under review, coupled with the weakness of the US Dollar versus the other operating currencies of the Group which resulted in a foreign exchange loss of $0.5million.
Notwithstanding the lower performance, the Group maintained its healthy cash-flow and strong balance sheet. As at 30 June 2008, cash balance stood at approximately $22.5 million. Operating activities generated cash inflow of $5.4million compared to $7.2million generated during the same period in the last financial year. Supported by its strong cash position, the Group has very little borrowings with a gearing of 0.03 times.
Commenting on Teckwah’s interim financial performance, Mr Thomas Chua – Chairman and Managing Director said: “Business conditions are very challenging in the first half of this year. Our strong balance sheet and healthy cash flow have kept us in good stead. In our acquisition path to supplement organic growth, we have looked out for potential targets in the supply chain and logistics sector but we have not made any offer yet as we expect the tough operating conditions to continue into the second half of the year. Within our organisation we adopt a cautious business approach."
For the second half of FY2008, the Group expects that its performance will be on par with that of the first six months of the current financial year and that it will continue to operate profitably in FY2008.
“In the second half of this year we expect some new customers to come on board and some projects that have been delayed will be turned on. Together, these developments will help bolster the performance of the Group in the second half of FY2008,” Mr Thomas Chua added when commenting about his expectations for Teckwah.
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