News

Full Year Financial Statement And Dividend Announcement

BackFeb 25, 2003

PART I - INFORMATION REQUIRED FOR ANNOUNCEMENTS OF QUARTERLY (Q1, Q2 & Q3), HALF-YEAR AND FULL YEAR RESULTS

    1(a) An income statement (for the group) together with a comparative statement for the corresponding period of the immediately preceding financial year



       

      Group
      S$'000s
      Group
      S$'000s
      % Increase/ (Decrease)
      Company
      S$'000s
      Company
      S$'000s
      % Increase/ (Decrease)
      31/12/2002
      31/12/2001
      31/12/2002
      31/12/2001
      Revenues
      112,090
      84,223
      33.09
      15,695
      6,849
      129.16
      Costs and expenses
      Changes in inventories in finished goods
      (6,029)
      (6,865)
      (12.18)
      0
      0
      -
      Raw materials and consumables used
      57,775
      46,250
      24.92
      0
      0
      -
      Depreciation and amortisation expenses
      1,007
      786
      28.12
      0
      0
      -
      Impairment loss (Note 1)
      137
      1,204
      (88.62)
      630
      444
      41.89
      Foreign exchange loss/(gain)
      1,739
      (1,290)
      (234.81)
      54
      (42)
      (228.57)
      Other operating expenses (include staff costs)
      37,852
      28,036
      35.01
      447
      2,379
      (81.21)
      Other (revenue)/expenses
      (596)
      (151)
      294.70
      25
      (24)
      (204.17)
      Total costs and expenses
      91,885
      67,970
      35.18
      1,156
      2,757
      (58.07)
      Profit from operating activities
      20,205
      16,253
      24.32
      14,539
      4,092
      255.30
      Finance costs
      (53)
      (22)
      140.91
      0
      0
      -
      Share of loss of unconsolidated associates
      (231)
      (154)
      50.00
      0
      0
      -
      Profit from ordinary activities before taxation
      19,921
      16,077
      23.91
      14,539
      4,092
      255.30
      Taxation
      (3,583)
      (3,666)
      (2.26)
      (3,377)
      (1,494)
      126.04
      Minority interests
      (1,544)
      (1,435)
      7.60
      0
      0
      -
      Net profit for the year
      14,794
      10,976
      34.78
      11,162
      2,598
      329.64

      Note 1: Impairment losses for the Group arose from the downward valuation of properties, and for the Company, it related to the provision for diminution in value of investments in the subsidiary and associated companies.

    1(b)(i) A balance sheet (for the issuer and group), together with a comparative statement as at the end of the immediately preceding financial year



       

      Group
      Company
      2002
      (S$'000)
      2001
      (S$'000)
      2002
      (S$'000)
      2001
      (S$'000)
      Assets Less Liabilities
      Non Current Assets
      Fixed assets
      11,994
      9,253
      -
      -
      Investments in subsidiary companies
      -
      -
      12,676
      12,936
      Investment in associated company
      448
      679
      428
      834
      Deferred tax assets
      218
      -
      -
      -
      Intangible assets
      59
      79
      -
      -
      12,719
      10,011
      13,104
      13,770
      Current assets
      Cash and bank balances
      8,122
      8,536
      47
      582
      Fixed deposits
      -
      293
      -
      -
      Other financial asset
      -
      500
      -
      500
      Trade receivables
      15,880
      8,981
      -
      -
      Other receivables
      3,840
      3,412
      108
      111
      Amount due from subsidiary companies
      -
      -
      21,306
      10,470
      Amount due from associated company
      991
      852
      991
      852
      Inventories
      29,221
      21,146
      -
      -
      58,054
      43,720
      22,452
      12,515
      Current liabilities
      Trade payables
      (10,619)
      (5,183)
      -
      -
      Bills Payable
      (167)
      (219)
      -
      -
      Other payables
      (4,210)
      (3,776)
      ( 211)
      (154)
      Term loan, secured
      -
      (40)
      -
      -
      Finance lease liabilities
      (7)
      -
      -
      -
      Provision for taxation
      (2,599)
      (3,582)
      (2)
      (2)
      (17,602)
      (12,800)
      (213)
      (156)
      Net current assets
      40,452
      30,920
      22,239
      12,359
      Non-Current Liabilities
      Term loan, secured
      -
      (437)
      -
      -
      Finance lease liabilities
      (28)
      -
      -
      -
      Deferred liabilities
      (306)
      (366)
      -
      -
      (334)
      (803)
      -
      -
      Net assets
      52,837
      40,128
      35,343
      26,129
      Equity
      Share capital
      17,200
      17,200
      17,200
      17,200
      Reserves
      33,142
      20,720
      18,143
      8,929
      50,342
      37,920
      35,343
      26,129
      Minority interests
      2,495
      2,208
      -
      -
      52,837
      40,128
      35,343
      26,129



       

    1(b)(ii) Aggregate amount of group's borrowings and debt securities


      Amount repayable in one year or less, or on demand

      As at 31/12/2002
      As at 31/12/2001
      Secured
      Unsecured
      Secured
      Unsecured
      0
      S$174,333.00
      S$39,752.00
      S$219,203.00



      Amount repayable after one year

      As at 31/12/2002
      As at 31/12/2001
      Secured
      Unsecured
      Secured
      Unsecured
      0
      S$27,541.00
      S$436,833.00
      0



      Details of any collateral

      NIL

    1(c) A cash flow statement (for the group), together with a comparative statement for the corresponding period of the immediately preceding financial year



       

      31/12/2002
      31/12/2001
      S$'000
      S$'000
      Cash flows from operating activities:
      Profit from ordinary activities before taxation and minority interests
      19,921
      16,077
      Adjustments For:
      Amortisation of goodwill
      20
      20
      Depreciation of fixed assets
      1,004
      766
      Exchange realignment
      (295)
      211
      Loss on disposal of fixed assets
      24
      107
      Interest income
      (32)
      (84)
      Interest expense
      53
      22
      Impairment loss on fixed assets
      137
      1,204
      Preliminary expense written off
      -
      20
      Share of results of associated company
      231
      154
      Gain on liquidation/disposal of subsidiary companies
      (445)
      -
      Capital reserve written off
      (16)
      -
      Operating income before reinvestment in working capital
      20,602
      18,497
      Increase in receivables
      (7,327)
      (2,409)
      Increase in inventories
      (8,075)
      (8,692)
      Increase in payables
      6,946
      263
      Cash generated from operations
      12,146
      7,659
      Income taxes paid
      (4,844)
      (3,485)
      Net cash generated from operating activities
      7,302
      4,174
      Cash flows from investing activities
      Purchase of other financial asset
      -
      (500)
      Interest received
      32
      84
      Purchase of shares in an associated company
      -
      (834)
      Acquisition of additional interest in a subsidiary company
      -
      (469)
      Dividends paid to minority shareholders of subsidiary companies
      (1,257)
      (292)
      Proceeds from disposal of fixed assets
      18
      168
      Purchase of fixed assets
      (4,037)
      (3,232)
      Proceeds from issuance of shares to minority shareholder of a subsidiary company
      -
      130
      Net cash inflow from disposal of a subsidiary company
      6
      130
      Proceeds on maturity of other financial asset
      500
      -
      Net cash used in investing activities
      (4,738)
      (4,815)
      Cash flows from financing acitivites
      Interest paid
      (53)
      (22)
      Dividends paid to shareholders of the Company
      (1,948)
      (1,298)
      Repayment of interest-bearing borrowings
      (1,131)
      61
      Proceeds from term loan
      -
      477
      Loan to associated company
      (139)
      (852)
      Net cash used in financing acitivities
      (3,271)
      (1,634)
      Net decrease in cash and cash equivalents
      (707)
      (2,275)
      Cash and cash equivalents at beginning of the year
      8,829
      11,104
      Cash and cash equivalents at end of the year
      8,122
      8,829



       

    1(d)(i) A statement (for the issuer and group) showing either (i) all changes in equity or (ii) changes in equity other than those arising from capitalisation issues and distributions to shareholders, together with a comparative statement for the corresponding period of the immediately preceding financial year



       

      Share Capital
      Share Premium
      Capital Reserve
      Foreign CurrencyTranslation Reserve
      RevenueReserve
      Total
      $'000s
      $'000s
      $'000s
      $'000s
      $'000s
      $'000s
      The Group
      Balance as at 1/1/2001
      17,200
      6,086
      16
      68
      3,287
      26,657
      Movements during the year
      -
      -
      -
      287
      -
      287
      Effect of change in accounting policy on proposed dividend
      -
      -
      -
      -
      1,299
      1,299
      Balance at beginning of the year as restated
      17,200
      6,086
      16
      355
      4,586
      28,243
      Net profit for the year
      -
      -
      -
      -
      10,976
      10,976
      Dividend on ordinary shares
      -
      -
      -
      -
      (1,299)
      (1,299)
      Balance as at 31/12/2001
      17,200
      6,086
      16
      355
      14,263
      37,920
      Movements during the year
      -
      -
      (16)
      (408)
      -
      (424)
      Net profit for the year
      -
      -
      -
      -
      14,794
      14,794
      Dividend on ordinary shares
      -
      -
      -
      -
      (1,948)
      (1,948)
      Balance as at 31/12/2002
      17,200
      6,086
      0
      (53)
      27,109
      50,342
      The Company
      Balance as at 1/1/2001
      17,200
      6,086
      0
      0
      245
      23,531
      Effect of change in accounting policy on proposed dividend
      -
      -
      -
      -
      1,299
      1,299
      Balance at beginning of the year as restated
      17,200
      6,086
      0
      -
      1,544
      24,830
      Net profit for the year
      -
      -
      -
      -
      2,598
      2,598
      Dividend on ordinary shares
      -
      -
      -
      -
      (1,299)
      (1,299)
      Balance as at 31/12/2001
      17,200
      6,086
      0
      0
      2,843
      26,129
      Net profit for the year
      -
      -
      -
      -
      11,162
      11,162
      Dividend on ordinary shares
      -
      -
      -
      -
      (1,948)
      (1,948)
      Balance as at 31/12/2002
      17,200
      6,086
      0
      0
      12,057
      35,343



       

    1(d)(ii) Details of any changes in the company's share capital arising from rights issue, bonus issue, share buy-backs, exercise of share options or warrants, conversion of other issues of equity securities, issue of shares or cash or as consideration for acquisition or for any other purpose since the end of the previous period reported on. State also the number of shares that may be issued on conversion of all the outstanding convertibles as at the end of the current financial period reported on and as at the end of the corresponding period of the immediately preceding financial year


      There was no change in the company's share capital during the financial year.

      As at 31 December 2002, there were unexercised options for 17,720,000 of unissued ordinary shares of the Company under the Food Empire Share Option Scheme (31 December 2001: Nil).

    2. Whether the figures have been audited, or reviewed and in accordance with which standard (e.g. the Singapore Standard on Auditing 910 (Engagements to Review Financial Statements), or an equivalent standard)


      The figures are unaudited and were not reviewed by the auditors.

    3. Where the figures have been audited or reviewed, the auditors' report (including any qualifications or emphasis of matter)


      Not applicable.

    4. Whether the same accounting policies and methods of computation as in the issuer's most recently audited annual financial statements have been applied


      Except as disclosed in paragraph 5 below, the Group has applied the same accounting policies and methods of computation in the financial statements for the current financial year compared with the audited financial statements as at 31st December 2001.

    5. If there are any changes in the accounting policies and methods of computation, including any required by an accounting standard, what has changed, as well as the reasons for, and the effect of, the change


      In compliance with the new Singapore Statements of Accounting Standard ("SAS"), the Group has adopted the standard SAS 12 (Revised) Income Taxes.

      There is no impact on the adoption of the standard to the financial statements.

    6. Earnings per ordinary share of the group for the current period reported on and the corresponding period of the immediately preceding financial year, after deducting any provision for preference dividends



       

      Group Figures
      Group Figures
      31/12/2002
      31/12/2001
      Earnings per share
      (i) Based on existing issued share capital (cents)
      4.30
      3.19
      (ii) On a fully diluted basis (cents)
      4.22
      3.19



       

    7. Net asset value (for the issuer and group) per ordinary share based on issued share capital of the issuer at the end of the (a) current period reported on and (b) immediately preceding financial year



       

      Group
      Group
      Company
      Company
      31/12/2002
      31/12/2001
      31/12/2002
      31/12/2001
      Net asset backing per ordinary share (cents)
      14.63
      11.02
      10.27
      7.60



       

    8. A review of the performance of the group, to the extent necessary for a reasonable understanding of the group's business. The review must discuss any significant factors that affected the turnover, costs, and earnings of the group for the current financial period reported on, including (where applicable) seasonal or cyclical factors. It must also discuss any material factors that affected the cash flow, working capital, assets or liabilities of the group during the current financial period reported on


      The Group enjoyed another year of good growth in FY2002 with revenue increased by 33.1% to S$112.1 million compared to the previous year. This was achieved through stronger sales across all major markets, namely Russia, Eastern Europe and Central Asia.

         

      The Group performed well in FY2002 in spite of the world economic slowdown and a very competitive market environment. In FY2002, the Group improved its sales to key markets mainly due to the better market penetration on the back of the strong brand names that the Group has built up over the years. The strong brand management provided the Group with good consumer loyalty that enabled the Group to maintain its margins and market share under such a competitive environment. In FY2002, the Group continued with its intensive advertising and promotional activities. This, coupled with the launch of a wide array of new products and a multiple brand distribution strategy, contributed to the overall good performance.

      Beverage products remain our major selling items, contributing about 89.5% of the Group's total revenue. Other products, comprising frozen food, candy and snacks recorded combined revenue of about S$11.8 million in FY2002.

      Our key market in Russia consists of 54.5% of the Group's total revenue, whilst Eastern Europe and Central Asia made up 32.9%. Other markets include Vietnam, the PRC, Western Europe, Middle East and USA which collectively contributed S$14.1 million or 12.6% of the Group's revenue.

      The Group's Profit Before Tax increased by 23.9% to S$19.9 million as compared to the previous year. In FY2002, the Group managed to contain the cost of raw materials at about the same level and achieved notable improvement in operational efficiencies. However, the Group has incurred higher overseas office expenses in the expansion of our distribution network in the key markets. Advertisement and promotional expenses have also gone up along with our brand management program of maintaining strong brand names and introduction of new products. In addition, the Group incurred an exchange loss of S$1.7 million as compared to a gain of S$1.3 million in the previous year. This lead to the lower percentage increase in the Group's Profit Before Tax as compared to the percentage increase in revenue.

      The foreign exchange loss was due to the weakening of the US dollar against the Singapore dollar. Given the substantial natural hedge, the Group does not see a need to adopt other hedging instruments.

      Net Profit After Tax and Minority Interests increased by 34.8% to S$14.8 million. The increase is due to tax reliefs and reduction in tax rate.

    9. Where a forecast, or a prospect statement, has been previously disclosed to shareholders, any variance between it and the actual results


      The results of the Group for the year under review are consistent with the prospect statement contained in the announcement on the Half Year Financial Statements released on 20 August 2002.

    10. A commentary at the date of the announcement of the competitive conditions of the industry in which the group operates and any known factors or events that may affect the group in the next reporting period and the next 12 months


      The markets which the Group operates in will continue to be competitive in the coming year. The Group will continue to invest in brand building through advertisement and promotion, product quality and packaging designs to gain consumer loyalty and build on its competitive strength.

      As the bulk of the Group's turnover comes from overseas, its profitability will continue to be affected by foreign currency fluctuations. Other than the above mentioned, the Group is not aware of any material factors or events that may affect the Group in the next reporting period and the next 12 months.

      Barring unforeseen circumstances and the uncertainties in the global economy, the Directors expect the Group to maintain a steady performance in FY2003.

    11. Dividend


      (a) Current Financial Period Reported On

      Any dividend declared for the current financial period reported on? Yes

      Name of Dividend
      First & Final
      Special Dividend
      Dividend Type
      Cash
      Cash
      Dividend Rate 0.5 cents per ordinary share (less tax) 0.75 cents per ordinary share (less tax)
      Par value of shares
      $0.05
      $0.05
      Tax Rate
      22%
      22%



      (b) Corresponding Period of the Immediately Preceding Financial Year

      Any dividend declared for the corresponding period of the immediately preceding financial year? Yes

      Name of Dividend
      First & Final
      Special Dividend
      Dividend Type
      Cash
      Cash
      Dividend Rate 0.5 cents per ordinary share (less tax) 0.25 cents per ordinary share (less tax)
      Par value of shares
      $0.05
      $0.05
      Tax Rate
      24.5%
      24.5%



      (c) Date payable

      The proposed First & Final and Special Dividends, if approved at the Annual General Meeting, will be paid at a date to be announced.


      (d) Books closure date

      Notice will be given at a later date on the closure of Share Transfer Books and the Register of Members to determine the shareholders' entitlements to the proposed First & Final and Special Dividends.

    12. If no dividend has been declared/recommended, a statement to that effect


      Not applicable


PART II - ADDITIONAL INFORMATION REQUIRED FOR FULL YEAR ANNOUNCEMENT
(This part is not applicable to Q1, Q2, Q3 or Half Year Results)


       

    13. Segmented revenue and results for business or geographical segments (of the group) in the form presented in the issuer's most recently audited annual financial statements, with comparative information for the immediately preceding year



       

      By Product
      2002
      Beverages
      Others
      Elimination
      Total
      (S$'000)
      (S$'000)
      (S$'000)
      (S$'000)
      Segment revenue from external customers
      100,312
      11,778
      -
      112,090
      Inter segment revenue
      98,651
      52,345
      (150,996)
      -
      Total revenue
      198,963
      64,123
      (150,996)
      112,090
      Segment results
      19,632
      19,009
      (18,436)
      20,205
      Finance Costs
      (53)
      Share of loss of associated company
      (231)
      Profit from operating activities before taxation and minority interests
      19,921
      Taxation
      (3,583)
      Minority interests, net of taxes
      (1,544)
      Net profit for the year
      14,794
      By Product
      2001
      Beverages
      Others
      Elimination
      Total
      (S$'000)
      (S$'000)
      (S$'000)
      (S$'000)
      Segment revenue from external customers
      79,294
      4,929
      -
      84,223
      Inter segment revenue
      102,632
      30,256
      (132,888)
      -
      Total revenue
      181,926
      35,185
      (132,888)
      84,223
      Segment results
      13,096
      9,818
      (6,661)
      16,253
      Finance Costs
      (22)
      Share of loss of associated company
      (154)
      Profit from operating activities before taxation and minority interests
      16,077
      Taxation
      (3,666)
      Minority interests, net of taxes
      (1,435)
      Net profit for the year
      10,976
      By Country 2002
      Russia
      Eastern Europe & Central Asia
      Others
      Elimination
      Total
      (S$'000)
      (S$'000)
      (S$'000)
      (S$'000)
      (S$'000)
      Segment revenue from external customers
      61,097
      36,864
      14,129
      -
      112,090
      Inter segment revenue
      150,996
      (150,996)
      -
      Total Revenue
      61,097
      36,864
      165,125
      (150,996)
      112,090


       

      By Country 2001
      Russia
      Eastern Europe & Central Asia
      Others
      Elimination
      Total
      (S$'000)
      (S$'000)
      (S$'000)
      (S$'000)
      (S$'000)
      Segment revenue from external customers
      48,212
      28,015
      7,996
      -
      84,223
      Inter segment revenue
      132,888
      (132,888)
      -
      Total Revenue
      48,212
      28,015
      140,884
      (132,888)
      84,223



       

    14. In the review of performance, the factors leading to any material changes in contributions to turnover and earnings by the business or geographical segments


      Included in paragraph 8 above.

    15. A breakdown of sales



       

      Group
      S$'000
      %
      31/12/2002
      31/12/2001
      Change
      (S$'000)
      (S$'000)
      Sales reported for first half year
      44,313
      33,430
      32.55
      Operating profit after tax before deducting minority interests reported for first half financial year
      5,430
      4,353
      24.74
      Sales reported for second half year
      67,777
      50,793
      33.44
      Operating profit after tax before deducting minority interests reported for second half financial year
      10,908
      8,058
      35.37



       

    16. A breakdown of the total annual dividend (in dollar value) for the issuer's latest full year and its previous full year


      Total Annual Dividend (Refer to Para 16 of Appendix 7.2 for the required details)

      Latest Full Year (S$)
      Previous Full Year (S$)
      Ordinary
      3,354,000
      1,947,900
      Preference
      0
      0
      Total:
      3,354,000
      1,947,900


       


       

BY ORDER OF THE BOARD

Loh Shu Chun
Company Secretary
25/02/2003