Extracted from Annual Report 2017
Recap of Financial Year ended 31 December 2017
Ongoing weakness in worldwide demand for personal computer and hard disk drive products continued to weigh on the Group's business turnover in financial year ended 31 December 2017. The Group's core Electronics & Precision Engineering customer segment registered lower customer order level during the financial year. Consequently, segment results also decreased following lower contribution from weak sales.
For FY2017, the Group recorded total business turnover of $8.2 million, a decrease of 32.8% compared to $12.2 million reported in the previous financial year. For FY2017, the Group recorded a gross loss of $1.0 million, compared with gross profit of $0.2 million achieved in the previous year, due to low sales and fixed overheads which included additional depreciation of the newly completed Tuas South factory.
Other major items include increase in other operating expenses, including a $5.6 million fair value assessment loss in relation to the Group's buildings at Penjuru and Tuas South, which was partially offset by Asset Revaluation Reserve (for details please refer to Statement of Financial Position and relevant notes), as well as increase in administrative expenses by 47.7% to $5.8 million from $3.9 million in FY2016, mainly due to an exchange loss of $1.6 million arising partly from products and purchases transacted in United States Dollar currency and partly from translation of United States Dollar currency balances to Singapore Dollar currency for financial reporting purposes.
At the pre-tax level, the Group's continuing operations reported a loss of $10.5 million, compared with a loss of $2.5 million in FY2016.
Electronics & Precision Engineering
This segment comprises mainly of component manufacturers for the Electronics, Personal Computers, Hard Disk Drive and Consumer Products industries.
Revenue from this segment decreased by 34.1% to $7.5 million for the year ended 31 December 2017. The Group recorded lower total sales orders from this segment due to ongoing weakness in worldwide personal computer and hard disk drive shipment. Segment results also decreased due to lower contribution from weak sales.
Construction & Infrastructure
This segment comprises mainly of fabricators, contractors and stockists who serve the construction, civil engineering and infrastructure building industries.
Revenue from this segment decreased by 16.0% to $0.7 million during the year. In FY2017, the Group continued to face intense price competition in this segment. The lower segment sales, coupled with rising raw material cost, resulted in lower contribution margin hence lower segment results.