REVENUE BY ACTIVITIES
REVENUE BY GEOGRAPHY
Consolidated Statement of Profit or Loss
Revenue
For the financial year ended 31 December 2022 ("FY2022"), the Group recorded a revenue of S$328.4 million, an increase of S$55.2 million or 20.2% compared to S$273.2 million for the previous corresponding financial year ended 31 December 2021 (“FY2021”). Although some projects were put on hold, the Group’s diversified capabilities and portfolios have enabled it to secure new opportunities that emerged which contributed positively to its revenue.
The Exhibitions, Thematic & Attractions division registered a revenue of S$141.6 million in FY2022, an increase of S$32.8 million or 30.1% from S$108.8 million recorded in FY2021. The increase in revenue was mainly due to the return of physical trade shows, conferences and events as travel restrictions and social distancing requirements due to the COVID-19 pandemic eased.
The Retail & Corporate Interiors division recorded a revenue of S$164.4 million in FY2022, an increase of S$16.0 million or 10.8% compared to S$148.4 million in FY2021. The division saw a pick up in the volume of projects as clients accelerated their business plans to refresh or launch new concepts to engage their audiences in the new environment.
The Research & Design division achieved a revenue of S$14.6 million in FY2022, an increase of S$1.6 million or 12.4% from S$13.0 million in FY2021. The division pushed hard, and through its innovative design solutions offered to clients, managed to capitalise on opportunities in the market and saw numerous projects proceeding or completed as planned.
The Experiential Marketing division registered a revenue of S$7.7 million in FY2022, an increase of S$4.8 million or 165.0% compared to S$2.9 million in FY2021. The increase in revenue was mainly due to the resumption of face-to-face brand activation events and conferences that contributed to the multiple projects the division secured and delivered.
Gross Profit
Gross profit in FY2022 increased by S$11.4 million or 19.4% to S$70.3 million compared to S$58.9 million recorded in FY2021. The increase was mainly a result of higher revenue registered. Gross profit margin remained stable at 21.4% in FY2022 compared to 21.6% in FY2021.
Other Items Of Income
Interest income increased by S$196,000 or 73.1% from S$268,000 in FY2021 to S$464,000 in FY2022. The increase was mainly due to higher fixed deposit interest rates offered by banks.
Other income decreased by S$2.9 million or 32.8% from S$9.0 million recorded in FY2021 to S$6.1 million in FY2022. The decrease was mainly due to an absence of a gain on disposal of assets classified as held for sale (which was completed during FY2021) and lower grants, subsidies and rebates (arising largely from the Jobs Support Scheme), and partially offset by higher gain on lease modifications (arising largely from a change in the lease terms of premises for an experiential and themed attraction business), rental income, write-back of impairment loss on doubtful trade receivables and write-off of trade and other payables.
Other Items Of Expense
Depreciation of property, plant and equipment was S$2.7 million in FY2022, a decrease of S$0.3 million or 9.9% from S$3.0 million in FY2021. The decrease was mainly due to fully depreciated assets, of which no further depreciation charge was recorded.
Employee benefits expense increased by S$6.8 million or 14.2% from S$48.3 million in FY2021 to S$55.1 million in FY2022. The increase was mainly due to costs resulting from increased headcount, salary adjustments effected in line with market conditions and higher performance linked incentives recorded.
Other expenses stood at S$13.2 million in FY2022, a decrease of S$0.7 million or 4.8% compared to S$13.9 million in FY2021. The decrease was mainly due to cost containment measures implemented and lower impairment loss recognised on doubtful trade receivables, which were partially offset by the recognition of bad non-trade debt written off and impairment loss on investments in associates. The impairment loss on doubtful trade receivables mainly pertains to final account claims and retention sums and the bad non-trade debt written off pertains to a loan made to a joint venture for working capital purpose, and were made in consideration of the difficulty encountered in the recovery of the balances. The impairment loss on investments in associates was recognised after a review of the assets and the assumptions used in the assessment of their carrying values.
Interest expense increased by S$0.1 million or 13.3% from S$0.9 million in FY2021 to S$1.0 million in FY2022. The increase in interest expense was mainly due to higher interest rates charged on the loans and borrowings, and partially offset by a lower amount of loans and borrowings outstanding.
Share Of Result Of Joint Venture
Share of profit of joint venture in FY2022 was not recognised after taking into account the Group’s cumulative share of the unrecognised losses as at 31 December 2021.
Share Of Results Of Associates
Share of results of associates changed by S$2.0 million from a loss of S$1.1 million in FY2021 to a profit of S$0.9 million in FY2022. The change was mainly due to compensation income received by an associate from the failure of a client to fulfil its contractual obligations.
Income Tax Expense
Income tax expense increased by S$0.4 million or 38.3% from S$1.2 million in FY2021 to S$1.6 million in FY2022. The increase was mainly due to the provision of income tax by profitable entities of the Group, and partially offset by the recognition of deferred tax assets arising largely from tax losses of entities of the Group.
Profit Net Of Tax Attributable To Equity Holders Of The Company
Based on the above, profit net of tax attributable to equity holders of the Company increased by S$3.6 million or 361.9% from S$1.0 million in FY2021 to S$4.6 million in FY2022.
REVIEW OF FINANCIAL POSITION
Non-current Assets
Non-current assets amounted to S$60.7 million as at 31 December 2022, representing a decrease of S$4.6 million from S$65.3 million as at 31 December 2021. The decrease was mainly due to lower land use rights, property, plant and equipment, other investments and right-of-use assets of S$0.4 million, S$2.7 million, S$1.4 million and S$0.3 million respectively, and partially offset by higher deferred tax assets of S$0.3 million.
The decrease in land use rights was mainly due to the amortisation charge for the year.
The decrease in property, plant and equipment was mainly due to the depreciation charge for the year and impairment loss on experiential and themed attraction asset (after a review of the asset and the assumptions used in the assessment of its carrying value), and partially offset by addition of assets for the year.
The decrease in other investments was mainly due to the disposal of the investment in quoted warrants during the year and the recognition of a decline in the fair value of the investment in quoted equity shares based on quoted market price as at 31 December 2022.
The decrease in right-of-use assets was mainly due to the depreciation charge for the year and impairment loss on the lease of premises for an experiential and themed attraction business (after a review of the asset and the assumptions used in the assessment of its carrying value), and partially offset by addition of assets for the year.
The increase in deferred tax assets was mainly due to the recognition arising largely from tax losses of entities of the Group for the year.
Current Assets
Current assets amounted to S$206.3 million as at 31 December 2022, representing an increase of S$21.2 million from S$185.1 million as at 31 December 2021. The increase was mainly due to higher contract assets, trade and other receivables and other assets of S$12.7 million, S$13.3 million and S$0.6 million espectively, and partially offset by lower cash and cash equivalents of S$5.2 million.
The increase in contract assets was mainly due to the longer duration taken to perform and complete the works and the subsequent approval by, and invoicing to, clients due to the pandemic.
Trade and other receivables comprise of trade receivables and other receivables of S$79.5 million (2021: S$63.3 million) and S$8.1 million (2021: S$11.0 million) respectively. The increase in trade receivables of S$16.2 million was in line with the level of business activities during the year. The decrease in other receivables of S$2.9 million was mainly due to lower loans receivable from joint venture and associates and miscellaneous receivables of S$1.3 million and S$1.7 million respectively, and partially offset by higher deposits of S$0.3 million.
The increase in other assets was mainly due to more prepayments made and was in line with the business activities during the year due to the pandemic.
The decrease in cash and cash equivalents was mainly attributable to the cash outflows from investing and financing activities, and partially offset by the cash inflows from operating activities.
Non-current Liabilities
Non-current liabilities amounted to S$19.3 million as at 31 December 2022, representing a decrease of S$5.5 million from S$24.8 million as at 31 December 2021. The decrease was mainly due to lower other financial liabilities of S$5.5 million.
Other financial liabilities comprise of loans and borrowings and lease liabilities of S$16.4 million (2021: S$18.7 million) and S$1.5 million (2021: S$4.7 million) respectively. The decrease in loans and borrowings of S$2.3 million and lease liabilities of S$3.2 million was mainly due to amounts reclassified from non-current to current as they become due and repayable within the next 12 months from 31 December 2022, and additionally for lease liabilities, due to the derecognition resulting from the lease modification arising from a change in the lease terms of premises for an experiential and themed attraction business. The decrease in lease liabilities was partially offset by new lease liabilities taken out.
Current Liabilities
Current liabilities amounted to S$138.9 million as at 31 December 2022, representing an increase of S$22.4 million from S$116.5 million as at 31 December 2021. The increase was mainly due to higher trade and other payables of S$23.3 million, and partially offset by lower other financial liabilities and other liabilities of S$0.4 million and S$0.7 million respectively.
Trade and other payables comprise of trade payables and other payables of S$97.5 million (2021: S$75.4 million) and S$17.4 million (2021: S$16.2 million) respectively. The increase in trade payables of S$22.1 million was in line with the level of business activities during the year. The increase in other payables of S$1.2 million was mainly due to higher provision for unutilised leave and accrued operating expenses of S$0.2 million and S$1.2 million respectively, and partially offset by lower miscellaneous payables of S$0.2 million.
Other financial liabilities comprise of loans and borrowings and lease liabilities of S$9.4 million (2021: S$10.1 million) and S$2.4 million (2021: S$2.1 million) respectively. The decrease in loans and borrowings of S$0.7 million and increase in lease liabilities of S$0.3 million was mainly due to new amounts taken out, repayments of matured amounts and amounts reclassified from non-current to current as they become due and repayable within the next 12 months from 31 December 2022.
Other liabilities comprise of deferred income of S$3.8 million (2021: S$4.5 million) and the decrease was due to derecognition of amounts as the projects commenced and works are performed during the year.
REVIEW OF CASH FLOW POSITION
Net cash from operating activities of S$4.3 million in FY2022 arose mainly from profit before tax of S$5.7 million and adjusted for a net increase in non-cash flow items of S$5.5 million (largely from bad non-trade debt written off, depreciation of property, plant and equipment, depreciation of right-of-use assets and gain on lease modifications) and cash outflow from a net increase in working capital requirements of S$4.9 million (largely from movements in contract assets, trade and other receivables and trade and other payables), and partially offset by income taxes paid of S$1.7 million.
Net cash used in investing activities of S$1.5 million in FY2022 arose mainly from purchase of property, plant and equipment of S$1.8 million, and partially offset by proceeds from disposal of other investment of S$0.3 million.
Net cash used in financing activities of S$6.3 million in FY2022 arose mainly from net repayment of loans and borrowings of S$2.8 million and repayment of lease liabilities of S$3.5 million.
Based on the above, the Group had a net decrease in cash and cash equivalents of S$3.5 million in FY2022 and the cash and cash equivalents stood at S$75.1 million as at 31 December 2022.
