News

First Quarter Financial Statement And Dividend Announcement For The Period Ended 31/03/2004

BackMay 12, 2004
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$'000)
      Group
      (S$'000)
      % Increase/ (Decrease)
      Jan-Mar
      2004
      Jan-Mar
      2003
      Revenue
      37,025
      29,387
      26.0
      Costs and expenses
      Changes in inventories of finished goods
      (1,189)
      341
      ) 26.6
      Raw materials and consumables used
      (16,805)
      (14,557)
      		 )
      Staff costs
      (3,195)
      (2,903)
      10.1
      Depreciation and amortisation expenses
      (371)
      (311)
      19.3
      Foreign exchange loss
      (752)
      (74)
      NM
      Other operating expenses (Note 1)
      (8,887)
      (7,503)
      18.4
      Other income
      76
      136
      (44.1)
      Total costs and expenses
      (31,123)
      (24,871)
      25.1
      Profit from operating activities
      5,902
      4,516
      30.7
      Finance costs
      -
      (5)
      NM
      Share of loss of an associated company
      (36)
      (53)
      (32.1)
      Profit from ordinary activities before taxation and minority interests
      5,866
      4,458
      31.6
      Taxation
      (1,341)
      (1,025)
      30.8
      Minority interests, net of taxation
      (587)
      (511)
      14.9
      Net profit for the period
      3,938
      2,922
      34.8


      NM- Not meaningful

      Note 1: Included in other operating expenses is a provision for doubtful debts of S$700,000 (2003:S$377,000)





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
      Group
      Company
      Company
      31/03/2004
      31/12/2003
      31/03/2004
      31/12/2003
      (S$'000)
      (S$'000)
      (S$'000)
      (S$'000)
      Assets Less Liabilities
      Non-Current Assets
      Fixed assets
      13,206
      13,459
      -
      -
      Investments in subsidiary companies
      -
      -
      12,519
      12,519
      Investment in an associated company
      1,106
      1,142
      1,082
      1,082
      Deferred tax assets
      652
      922
      -
      -
      Intangible asset
      34
      39
      -
      -
      14,998
      15,562
      13,601
      13,601
      Current Assets
      Cash and bank balances
      17,328
      11,825
      415
      30
      Trade receivables
      20,077
      20,591
      -
      -
      Prepayments, other deposits and other receivables
      2,847
      2,370
      12
      16
      Amounts due from subsidiary companies (non-trade)
      -
      -
      18,104
      18,118
      Amount due from an associated company (non-trade)
      309
      188
      309
      188
      Inventories
      22,064
      23,633
      -
      -
      62,625
      58,607
      18,840
      18,352
      Current Liabilities
      Trade payables
      (7,541)
      (7,920)
      -
      -
      Other payables
      (2,521)
      (3,379)
      (379)
      (234)
      Amount due to an associated company (trade)
      -
      (37)
      -
      -
      Provision for taxation
      (2,448)
      (2,045)
      -
      -
      (12,510)
      (13,381)
      (379)
      (234)
      Net Current Assets
      50,115
      45,226
      18,461
      18,118
      Non-Current Liabilities
      Deferred tax liabilities
      (506)
      (509)
      -
      -
      (506)
      (509)
      -
      -
      Net Assets
      64,607
      60,279
      32,062
      31,719
      Equity
      Share capital
      17,305
      17,200
      17,305
      17,200
      Reserves
      43,874
      39,802
      14,757
      14,519
      61,179
      57,002
      32,062
      31,719
      Minority interests
      3,428
      3,277
      -
      -
      64,607
      60,279
      32,062
      31,719




1(b)(ii) Aggregate amount of group's borrowings and debt securities.
      Amount repayable in one year or less, or on demand
      As at 31/03/2004
      As at 31/12/2003
      Secured
      Unsecured
      Secured
      Unsecured
      (S$'000)
      0
      S$'000
      0
      (S$'000)
      0
      (S$'000)
      0


      Amount repayable after one year
      As at 31/03/2004
      As at 31/12/2003
      Secured
      Unsecured
      Secured
      Unsecured
      (S$'000)
      0
      (S$'000)
      0
      (S$'000)
      0
      (S$'000)
      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.
      31/03/2004
      31/03/2003
      (S$'000)
      (S$'000)
      Cash flows from operating activities:
      Profit from ordinary activities before taxation and minority interests
      5,866
      4,458
      Adjustments for:
      Amortisation of goodwill
      5
      5
      Depreciation of fixed assets
      366
      306
      Exchange realignment
      (98)
      75
      (Gain)/ loss on disposal of fixed assets
      (9)
      133
      Interest income
      (1)
      (1)
      Interest expenses
      -
      5
      Share of loss of an associated company
      36
      53
      Operating income before reinvestment in working capital
      6,165
      5,034
      Decrease/(increase) in receivables
      37
      (2,073)
      Decrease/(increase) in inventories
      1,569
      (354)
      Decrease in payables
      (1,274)
      (1,467)
      Cash generated from operations
      6,497
      1,140
      Income taxes paid
      (668)
      (843)
      Net cash generated from operating activities
      5,829
      297
      Cash flows from investing activities:
      Interest income received
      1
      1
      Purchase of fixed assets
      (161)
      (1,469)
      Proceeds from sale of fixed assets
      9
      -
      Net cash used in investing activities
      (151)
      (1,468)
      Cash flows from financing activities:
      Interest expenses paid
      -
      (5)
      Dividends paid to minority shareholder of subsidiary company
      (407)
      -
      Repayment of interest-bearing borrowings
      -
      (2)
      Loan to an associated company
      (126)
      -
      Proceeds from issuance of shares
      358
      -
      Net cash used in financing activities
      (175)
      (7)
      Net increase/(decrease) in cash and cash equivalents
      5,503
      (1,178)
      Cash and cash equivalents at beginning of the period
      11,825
      8,122
      Cash and cash equivalents at end of the period
      17,328
      6,944


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
      Foreign Currency Translation Reserve
      Revenue Reserve
      Total
      (S$'000)
      (S$'000)
      (S$'000)
      (S$'000)
      (S$'000)
      The Group
      Balance as at 01/01/2003
      17,200
      6,086
      (53)
      27,109
      50,342
      Net profit for the period
      -
      -
      -
      2,922
      2,922
      Movements during the period
      -
      -
      109
      -
      109
      Balance as at 31/03/2003
      17,200
      6,086
      56
      30,031
      53,373
      Balance as at 01/01/2004
      17,200
      6,086
      (202)
      33,918
      57,002
      Net profit for the period
      -
      -
      -
      3,938
      3,938
      Movements during the period
      -
      -
      (119)
      -
      (119)
      Issuance of ordinary shares
      105
      253
      -
      -
      358
      Balance as at 31/03/2004
      17,305
      6,339
      (321)
      37,856
      61,179
      The Company
      Balance as at 01/01/2003
      17,200
      6,086
      -
      12,057
      35,343
      Net profit for the period
      -
      -
      -
      66
      66
      Balance as at 31/03/2003
      17,200
      6,086
      -
      12,123
      35,409
      Balance as at 01/01/2004
      17,200
      6,086
      -
      8,433
      31,719
      Net (loss) for the period
      -
      -
      -
      (15)
      (15)
      Issuance of ordinary shares
      105
      253
      -
      -
      358
      Balance as at 31/03/2004
      17,305
      6,339
      -
      8,418
      32,062


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 for 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.
      The issued and paid-up capital of the Company increased from S$17,200,000 as at 01 January 2004 to S$17,305,500 as at 31 March 2004. The increase was due to new ordinary shares of S$0.05 each allotted and issued pursuant to the exercise of options granted under the Food Empire Holdings Limited Share Option Scheme (the "Option Scheme").

      As at 31 March 2004, options to subscribe for a total of 15,255,000 ordinary shares were outstanding under the Option Scheme. As at 31 March 2003, options to subscribe for a total of 17,385,000 ordinary shares were outstanding under the Option Scheme.
      Balance
      as at
      01-Jan-04
      No of options granted
      during the period
      No of options exercised during the period
      Balance
      as at 31-Mar-04
      Exercise price
      per share
      Exercise
      Period
      2002 Options
      16,065,000
      -
      (2,110,000)
      13,955,000
      0.17
      		 14 March 2004 to 13 March 2012
      2002 Options
      800,000
      -
      -
      800,000
      0.17
      		 14 March 2004 to 13 March 2007
      2003 Options
      500,000
      -
      -
      500,000
      0.27
      		 04 June 2005 to 13 March 2012
      17,365,000
      -
      (2,110,000)
      15,255,000
2. Whether the figures have been audited or reviewed and in accordance with
      which auditing standard or practice.

      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 a 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.
      The Group has applied the same accounting policies and methods of computation in the financial statements for the current financial period compared with the audited financial statements as at 31 December 2003.


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.
      Not applicable.


6. Earnings per ordinary share of the group for the current financial period reported
      on and the corresponding period of the immediately preceding financial year,
      after deducting any provision for preference dividends.
      Group Figures
      Group Figures
      31/03/2004
      31/03/2003
      Earnings per share
      (i) Based on existing issued share capital (cents)
      1.14
      0.85
      (ii) On a fully diluted basis (cents)
      1.12
      0.83

      Earnings per ordinary share on existing issued share capital is computed based on weighted average number of 344,297,582 ordinary shares during the year.(31/03/2003:344,000,000)

      Earnings per ordinary share on a fully diluted basis is computed based on weighted average number of 352,734,997 ordinary shares during the year adjusted to assume conversion of all potential dilution.(31/03/2003:350,734,730)


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 financial period reported on; and
      (b) immediately preceding financial year.

      Group
      Group
      Company
      Company
      31/03/2004
      31/12/2003
      31/03/2004
      31/12/2003
      Net asset value per ordinary share (cents)
      17.68
      16.57
      9.26
      9.22
8. A review of the performance of the group, to the extent necessary for a reasonable
      understanding of the group's business. It must include a discussion of the
      following:-

      (a) 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; and

      (b) any material factors that affected the cash flow, working capital, assets or
      liabilities of the group during the current financial period reported on.


      First quarter 2004 ('1Q04') versus first quarter 2003 ('1Q03')

      For the quarter ended 31 March 2004, Group Revenue recorded a growth of 26.0% to S$37.0 million and Group Net Profit after Tax grew 34.8% to S$3.9 million as a result of stronger sales in the key markets of Russia, Eastern Europe & Central Asia.

      Revenue

      Table: Geographical Analysis
      1Q04
      1Q03
      % increase/
      (decrease)
      (S$'000)
      (S$'000)
      Russia
      22,227
      17,999
      23.5
      Eastern Europe & Central Asia
      12,228
      8,176
      49.6
      Others
      2,570
      3,212
      (20.0)
      Total
      37,025
      29,387
      26.0

      Revenue from Russia increased 23.5% to S$22.2 million while Eastern Europe & Central Asia sales rose 49.6% to S$12.2 million in 1Q04 as compared to 1Q03. The improvement in these core markets was due to strategic reinforcements of the Group's overseas operations and continued investments in building brand awareness and distribution network expansion.

      Revenue from Other Markets declined 20.0% to S$2.6 million due to the cessation of frozen seafood trading under a subsidiary.

      Russia contributed 60.0% to Group Revenue, followed by Eastern Europe & Central Asia with 33.0%. Revenue from Other Markets made up the balance 7.0%.

      Table: Product Analysis
      1Q04
      1Q03
      % increase/
      (decrease)
      (S$'000)
      (S$'000)
      Beverages
      33,870
      26,479
      27.9
      Non-Beverages
      3,155
      2,908
      8.5
      Total
      37,025
      29,387
      26.0

      Revenue from the Beverages segment grew 27.9% to S$33.9 million due mainly to higher demand for coffee-based products. The Non-Beverages category was boosted by broad-based sales growth that led to revenue improving 8.5% to $3.2 million.

      Beverages segment remained the core business with a 91.5% contribution to Group Revenue.

      Net Profit After Tax

      Net Profit After Tax ('PAT') increased 34.8% to S$3.9 million on the back of higher revenue and improved operating margins.

      Foreign exchange loss for 1Q04 was S$0.8 million versus a loss of S$0.1 million for 1Q03 with the weakening of the US$.

      Cash Flow Statement

      Following higher operating profits and reduced inventory levels, the Group's net cash position increased by S$5.5 million to S$17.3 million in 1Q04. The Group received proceeds of S$0.4 million from the exercise of share options under the Food Empire Holdings Limited Share Option Scheme.


9. Where a forecast, or a prospect statement, has been previously disclosed to
      shareholders, any variance between it and the actual results.
      Not applicable.


10. A commentary at the date of the announcement of the significant trends and
      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 Group expects market conditions to remain competitive and foreign currency fluctuations will remain a key consideration. The Group will continue to invest in brand building and distribution network expansion to improve its market share.


11. Dividend
      (a) Current Financial Period Reported On

      Any dividend declared for the current financial period reported on? None
      (b) Corresponding Period of the Immediately Preceding Financial Year

      Any dividend declared for the corresponding period of the immediately preceding financial year? None

      (c) Date payable
        Not applicable.


      (d) Books closure date
        Not applicable.


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.
      Not applicable.


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.
      Not applicable.


15. A breakdown of sales.
      Not applicable.


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 ()
      Previous Full Year ()
      Ordinary
      0
      0
      Preference
      0
      0
      Total:
      0
      0




BY ORDER OF THE BOARD

Tan San-Ju
Company Secretary
12/05/2004