45
BAKERTECHNOLOGYLIMITED
ANNUALREPORT2013
Financial Review
reap
Income Statement
2013
2012
Changes
$'000
$'000
%
Revenue
83,299
98,244
-15%
Cost of goods sold
(59,531)
(73,160)
-19%
Gross profits
23,768
25,084
-5%
Other operating income / (expenses), net
1,871
(173)
NM
Administrative expenses
(7,813)
(9,708)
-20%
Finance costs
(8)
(122)
-93%
Share of results of associates
(495)
587
NM
Gainondisposal of associates
8,757
10,894
-20%
Recognitionof deferredgain fromdisposal of subsidiary (PPLH)
-
58,237
NM
Profit before tax
26,080
84,799
-69%
Income tax expenses
(3,707)
(3,208)
16%
Profit after tax
22,373
81,591
-73%
Gross ProfitMargin
29% 26%
The 15% reduction inGroup revenuewasmainly attributable to the slowdown of order intake from July 2012 to June 2013,
and lower contribution from newer projects secured in FY2013. Despite the reduction in revenue, gross profit decreased by
only 5%due to bettermargins resulting from improvements in production efficiency.
Pre-tax profit was significantly lower compared to FY2012mainly due to lower investment gains in FY2013. In FY2013, the
Group recorded a gain of $8.8million on the disposal of its stake in Discovery Offshore S.A. In comparison, FY2012 pre-tax
profit included the recognition of a deferred gain of $58.2million from the sale of the stake in PPL Holdings Pte Ltd (‘PPLH”),
and a $10.9million gainon disposal of York Transport Equipment (Asia) Pte Ltd (“York”).
The decrease in pre-tax profit was partially offset by a reduction in administrative expenses, mainly due to lower payroll
costs and lower legal fees due to the conclusion of the legal suit inMay 2012. The Group’s key operating subsidiary in the
marineoffshore segment, SeaDeep,maintained its healthy contribution to theGroup’s earnings, contributingpre-tax profit of
$20.3million. Thiswas amarginal increase from$20.0million in 2012.
Other operating incomewasboostedbya foreignexchangegainof $1.6milliondue to the strengtheningof both theUSdollar
and the Euro against the Singapore dollar.
The Group’s effective tax rate for FY2013was 14% compared to 4% in FY2012. These rates were lower than the statutory
income tax rateof 17% inSingapore, as the substantial gains from thedisposalsof subsidiary / associateswere capital innature
and thus not subjected to tax.
As a result of the above factors, theGroup’s net profit reduced73% to$22.4million in FY2013. Basic earnings per sharewere
2.7 cents for FY2013, compared to 11.5 cents in FY2012. Fully diluted earnings per sharewere 2.4 cents, after adjusting for
the dilutive effect of approximately 145millionwarrants outstanding.
