Operation Review
Extracted from Annual Report 2011
Financial Highlights
The Group revenue for FY2011 was US$107.0 million, a decrease of 8.7% from US$117.1 million in FY2010. This was mainly due to lower contribution from non-recurring and non-chartering income and the Group deconsolidated the revenue from a subsidiary which the Group has divested its 80.1% interest in third quarter of FY2010. Cost of sales and servicing was US$51.7 million in the same period, a decrease of 28.6% compared to US$72.4 million a year before. This was due mainly to a decrease in non-recurring procurement activities and deduction in operation cost as a result of the divested subsidiary. Gross profit increased 23.7% to US$55.3 million due to the increased demand for our liftboats.
The Group reported other income of US$12.2 million. This was mainly derived from the disposal of one unit of the Group's multi-purpose self-propelled jack-up rig.
Finance income increased from US$390,000 to US$2.0 million in the corresponding period due mainly to increase in interest income from bank deposits and loan to joint ventures.
The share of results of joint ventures increased from US$6.8 million to US$9.5 million due mainly to the increased contributions from both the Group's joint ventures in Australia and the company that owns the Group's first multi-purpose, self-propelled jack-up rig.
Charter income derived from Singapore-flagged vessels are exempt from tax under Section 13A of the Income Tax Act of Singapore. FY2011 income tax expense of US$2.89 million relates to the corporate tax expense and withholding tax expense incurred by vessels operating in certain overseas waters.
As a result of the above, the Group's net profit increased by 44.6% over the year to US$58.1 million.
On a per share basis, diluted earnings per share amounted to 7.32 US cents, a 1.73 US cents increase compared to 5.59 US cents in FY2010. Net asset value as of financial year ended 31 December 2011 amounted to 37.60 US cents, a 8.17 US cents increase compared with 29.43 US cents a year before.
Business Segments
Analysing our revenue according to business segments, we witnessed a 26.4% decrease in revenue from offshore logistic support services over the year; from US$88.2 million in FY2010 to US$65.0 million in FY2011. Revenue from the service rigs segment increased 45.6% from US$28.9 million in FY2010 to US$42.0 million in FY2011. Over the year in review 2011, offshore logistic support services remained our larger business segment, comprising 60.7% of group revenue while the service rigs segment contributed 39.3%.
Geographical Segments
In terms of geographical segments, our revenue contributions in FY2011 were relatively well spreadout, reducing geographical market risk. Singapore contributed 27.1% or US$29.0 million to Group revenue; Australia, 36.0% or US$38.5 million; Far East and ASEAN countries, 34.9% or US$37.3 million; and Other Countries, 2.0% or US$2.1 million.