ASL Marine Reports Loss of S$13 million During Third Quarter

Group revenue of $35.9 million for the 3 months ended 30 September 2020 (“1Q FY2021”) was $5.6 million (13.5%) lower compared to the corresponding period in FY2020 (“1Q FY2020”).

Shipbuilding revenue increased by $1.6 million to $3.4 million in 1Q FY2021 as compared to last corresponding period. The revenue in 1Q FY2021 was attributable to higher percentage of progressive recognition from the construction of tugs based on POC method. In 1Q FY2020, the construction progress of tugs was slow, pending activation of project financing lines from the banks.

Shiprepair, conversion and engineering services revenue increased by $2.6 million (18.0%) to $17.1 million in 1Q FY2021 mainly due to reversal of accrued discounts for prior years’ completed projects and more orders of dredge components and spare parts in the current quarter under review.

Charter revenue decreased by $9.3 million (43.3%) to $12.2 million in 1Q FY2021 mainly due to lower utilisation of the vessels (1Q FY2021: 26%; 1Q FY2020: 56%).

This was due to:
(i) Lower charter income from OSVs in 1Q FY2021 mainly owing to early termination of one OSV and two chemical tankers in 2Q FY2020 and 4Q FY2020 respectively; and

(ii) Certain of the key marine transportation for local infrastructure projects being affected by temporary suspension consequent to the movements restriction during the Circuit Breaker Period in Singapore. These projects progressively resumed its operations in September 2020.

There were lower trade sales and other services rendered which comprised bunker sales, agency and management fees and ad-hoc marine-related services.

Shipbuilding The gross profit in 1Q FY2021 was comparable to last corresponding quarter. The higher gross profit margin of 10.9% recorded in 1Q FY2020 was partly due to the reversal of accrued costs for prior years’ completed projects.

Shiprepair, conversion and engineering services

In line with the increase in revenue in 1Q FY2021, gross profit increased by $1.0 million to $2.2 million (GPM: 12.5%) in 1Q FY2021 mainly due to reversal of accrued discounts for prior years’ completed projects and higher revenue contribution derived from supply of dredge components and spare parts. The margin in 1Q FY2020 was lower partly due to credit notes issued to certain customers.

Gross loss and gross loss margin for charter in 1Q FY2021 were attributable to lower revenue contribution from OSV, Tug boats and Barges which were insufficient to cover the fixed operating costs of the chartering fleet.

The Group recorded a higher loss before tax of $13.0 million in 1Q FY2021 (1Q FY2020: $6.3 million) mainly due to higher gross loss and impairment losses on financial assets, coupled with lower other operating income.

OPERATION CASH FLOWS

The Group recorded a lower net cash inflow from operating activities of $1.9 million in 1Q FY2021 (1Q FY2020: $17.1 million) mainly due to lower earnings, lower progressive billings received, higher purchase of inventories and prepayments as well as lower receipts from customers.

The net cash outflow from investing activities of $1.4 million in 1Q FY2021 (1Q FY2020: inflow of $1.2 million) was mainly attributed to absence of proceeds from disposal of a subsidiary, lower net proceeds from disposal of assets classified as held for sale, partially offset by lower purchase of property, plant and equipment. The lower net cash outflow from financing activities of $6.6 million in 1Q FY2021 (1Q FY2020: $15.2 million) was mainly due to lower repayments on interest-bearing loans and borrowings and interest paid, lower cash balances being restricted in shipbuilding project accounts, partially offset by higher net repayments on trust receipts and absence of net proceeds from issuance of rights warrants.
Source: ASL Marine