OPERATIONS
& FINANCIAL REVIEW
Despite revenue from only one
business segment, GKE managed
to narrow its net loss attributable to
owners of the Company to S$3.8
million in FY2015, from S$5.9 million
in FY2014. This was on the back of
a 15.4% year-on-year increase in
revenue to S$36.2 million. Revenue
growth was mainly due to an
increase in the volume handled by
its local transportation services and
higher revenue generated from its
warehouses at 30 Pioneer Road, 6
Pioneer Walk and Yangshan, China.
Coupled with better cost
management, gross profit increased
by 44.6% year-on-year to S$9.2
million in FY2015, and gross profit
margin improved from 20.4% in
FY2014 to 25.5% in FY2015.
Operating expenses increased by
1.5% year-on-year to S$14.3 million
in FY2015, mainly due to higher
finance costs from higher borrowings
for working capital purposes, and a
one-off expense relating to the legal
dispute over the proposed acquisition
of Uniplas (Shanghai) Co., Ltd which
resulted in higher administrative
expenses. These were partially
offset by lower other expenses as
there were fewer acquisitions and
corporate activities during the year.
In FY2015, finance costs increased
by 32.8% year-on-year to S$1.8
million due to higher borrowings for
its working capital.
Share of results of associates
dipped by 97.6% year-on-year from
S$0.3 million in FY2014 to S$7,000
in FY2015. This was attributed to
lower profit contribution from GKE
Metal Logistics Pte Ltd, owing to
a weaker commodity market, and
share of losses from Maoming. Share
of results of joint venture represents
the share of losses from Steadfast.
The Group’s loss before tax was
40.3% lower at S$4.1 million in
FY2015.
Tax expenses increased by 127.6%
year-on-year from S$0.3 million
in FY2014 to S$0.6 million in
FY2015. This was mainly due to
non-deductible tax depreciation
charges as well as the Singapore
government’s phasing out of the
industrial building allowance.
Consequently, net loss attributable to
owners of the Company narrowed by
35.4% year-on-year to S$3.8 million
in FY2015. This was driven by higher
revenue contribution, improved gross
margin as well as lower legal and
professional fees in relation to the
Group’s acquisition and corporate
activities.
FINANCIAL POSITION
The Group’s equity attributable to
owners of the Company improved
from S$67.5 million as at end
FY2014 to S$77.8 million as at
end FY2015. This mainly arose
from the share issuance in relation
to the Rights Issue in April 2015.
Based on the total number of issued
shares excluding treasury shares of
641,125,290 shares, the Group’s net
asset value per share was 12.14
Singapore cents as at end FY2015.
Property, plant and equipment
declined from S$121.3 million to
S$115.4 million as at end FY2015,
due to the disposal of crane
equipment in GKEMS following
the cessation of the crane service
operations. This was partially offset
with the purchase of fixed assets
15
GKE CORPORATION LIMITED
ANNUAL REPORT 2015
