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Email This Print ThisOperations Review
Extracted from Annual Report 2016

MARINE, OFFSHORE SUPPLY AND LOGISTICS

Marine, offshore supply and logistics business remains the backbone of Sinwa's business. Currently, our geographical presence includes Singapore, the People's Republic of China (including Hong Kong), Thailand and Australia. Amidst a sluggish economic environment, we continue to position ourselves as a distinct player in marine and offshore supply industry by providing our clients efficient services and one-stop solutions for all their shipping needs. Our comprehensive suite of services include agency, logistics and warehousing services which go hand in hand with our proven reputation for timeliness, reliability and quality. Through this, we have gained the continuous support from many of our clients, converting them into our long-term customers.

In recent years, we have expanded our area of operations through leveraging on our established brand name and identifying viable opportunities which add value to our business. In Thailand, we built a strong base working closely with one of our major oil and gas customers. We aim to further capitalise on the resilience in the growing offshore market there.

With a wealth of experience of over 50 years, our marine, offshore supply and logistics business continue to remain the key driver in our revenue growth.

FINANCIAL PERFORMANCE

REVENUE

The Group's revenue decreased 8.6% y-o-y to $152.2 million for FY2016, mainly due to slower demand from the marine offshore supply business both in Singapore and Australia.

MARINE AND OFFSHORE SUPPLY

Marine and Offshore Supply revenue for the Group decreased 8.6% y-o-y from $162.2 million in FY2015 to $148.2 million in FY2016. Revenue from our Agency and logistics decreased 6.0% y-o-y from $4.1 million in FY2015 to $3.8 million in FY2016 with profit for the year from this segment remaining relatively stable at about $0.6 million for FY2016.

PROFITABILITY

Overall gross profit decreased 6.3% to $37.0 million in FY2016 correspondingly with lower revenue.

FINANCIAL POSITION 2016 2015
Trade receivables turnover days 87 96
Inventory turnover days 14 14
Current asset/Current liabilities 2.02 2.49
Gearing Ratio (Total Borrowings/Total Equity) 0.07 0.03

In FY2016, the Group's trade receivables turnover days was reduced to 87 as compared to 96 in FY2015, as the Group improved its trade receivables management. Inventory turnover days are comparable to the previous year. The Group's current ratio was 2.02 times for FY2016 as compared to 2.49 times for FY2015 mainly due to the one-off allowance of impairment on asset held for sale and lower receivables and payables. The Group's gearing ratio was 0.07 times as a result of the Group's efforts to maintain a strong balance sheet in light of strong cashflow from opertations.