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Full Year Financial Statements Announcement for the 12 months ended 31 December 2017

Financials Archive

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An income statement and statement of comprehensive income, or a statement of comprehensive income, for the group, together with a comparative statement for the corresponding period of the immediately preceding financial year.

Consolidated Income Statement

Statement Of Comprehensive Income For Half Year Ended 31 December 2017

Statement Of Comprehensive Income For Full Year Ended 31 December 2017

Balance Sheet

Review of Performance

The Group's revenue decreased by S$1.6 million or 8% from S$20.6 million for the financial year ended 31 December 2016 ("FY2016") to S$19 million for the financial year ended 31 December 2017 ("FY2017"). The decrease was mainly due to lower revenue from the imaging business partially offset by an increase in revenue from the wellness business.

Other income decreased by S$486,000 or 61% in FY2017 mainly due to lower sub-lease income and grant income.

Consumables expense decreased by S$171,000 or 7% in line with the decrease in revenue. Personnel expense decreased by S$855,000 or 7% mainly due to manpower rationalisation. Depreciation expense decreased by S$104,000 or 7% as a result of fixed assets being fully depreciated. Maintenance of equipment expenses increased by S$132,000 or 19% due to the expiry of the warranty period of equipment acquired in previous years. Finance costs decreased by S$56,000 or 40% mainly due to the settlement of hire purchase liabilities and bank loans. The increase in other operating expenses of S$230,000 or 9% was mainly due to expenses incurred in relation to the proposed acquisition of LuyeEllium Healthcare Co., Ltd of S$598,000. The impairment of S$1.5 million in FY2017 relates mainly to the property, plant and equipment of the imaging business. The share of results of associate increased by S$33,000 or 11% due to its lower tax expense as a result of overprovision of income tax in previous years. The Group's tax credit in FY2016 was due to the recognition of deferred tax assets of the Group's unutilised capital allowances and unabsorbed tax losses. No deferred tax asset was recognised in FY2017.

As a result of the lower revenue from imaging business, lower other income, expenses incurred for the proposed acquisition of LuyeEllium, impairment of property, plant and equipment, and the nonrecognition of deferred tax assets, the Group recorded a loss of S$4.2 million for FY2017 compared to a loss of S$1.6 million for FY2016.

Non-Current Assets

Non-current assets decreased from S$11.6 million as at 31 December 2016 to S$9.4 million as at 31 December 2017. Property, plant and equipment decreased from S$7.7 million as at 31 December 2016 to S$5.4 million as at 31 December 2017 due to impairment and depreciation.

Current Assets

Current assets decreased from S$9.6 million as at 31 December 2016 to S$6.4 million as at 31 December 2017. Cash pledged as security increased from S$454,000 as at 31 December 2016 to S$932,000 due to additional health screening contracts secured. Cash and cash equivalents decreased from S$6.9 million as at 31 December 2016 to S$3.2 million as at 31 December 2017 due to the factors in the review of cash flow below.

Current Liabilities

Current liabilities decreased from S$6.3 million as at 31 December 2016 to S$5.9 million as at 31 December 2017. The increase in trade payables from S$1.1 million as at 31 December 2016 to S$1.6 million as at 31 December 2017 was mainly due to outstanding payments for capital expenditure. The increase in other payables and accruals from S$1.7 million as at 31 December 2016 to S$2 million as at 31 December 2017 was mainly due to fees payable for the proposed acquisition of LuyeEllium. The increase in deferred income from S$955,000 as at 31 December 2016 to S$1.2 million as at 31 December 2017 was due to higher level of outstanding customer packages. The Group settled the put option liabilities in FY2017. Loans and borrowing and obligations under finance leases decreased from S$1.5 million as at 31 December 2016 to S$0.8 million as at 31 December 2017 due to repayments of such loans and borrowings and obligations under finance leases.

Net Current Assets

As a result of the lower current assets, net current assets decreased from S$3.3 million as at 31 December 2016 to S$0.5 million as at 31 December 2017.

Non-Current Liabilities

Non-current liabilities decreased from S$1.5 million as at 31 December 2016 to S$0.7 million as at 31 December 2017 due to repayments of loans and borrowings and obligations under finance leases.

Cash Flow

The cash outflow from operating activities in FY2017 was S$1.1 million compared to a cash inflow of S$1.2 million in FY2016 mainly due to a higher operating loss, lower changes in working capital and the payment of expenses relating to the proposed acquisition of LuyeEllium. The cash outflow from investing activities of $546,000 in FY2017 compared to an outflow of S$260,000 in FY2016 mainly due to the payment for the purchase of non-controlling interests' stakes. The cash outflow from financing activities was S$2 million in FY2017 compared to an inflow of S$0.5 million in FY2016 mainly due to the private placement in FY2016. As a result, cash and short-term deposits decreased from S$6.9 million as at the end of FY2016 to S$3.2 million as at 31 December 2017.

Commentary

In FY2017, the Group started a program to review its businesses to meet competitive challenges and to contribute to the Group's strategic goals. The market condition of the Group continues to be competitive. The Group is committed to deliver improvements in its businesses, implement cost control measures and strengthen its balance sheet. It will also explore value-adding investment opportunities.

In respect of the proposed acquisition of the entire share capital of LuyeEllium Healthcare Co., Ltd, (the "Proposed Acquisition"), the Company and the vendors had mutually agreed to extend the long-stop date to 31 August 2018, as announced by the Company on 28 February 2018. The Company will release further announcements in compliance with the requirements of the Catalist Rules, as and when there are material updates or developments in respect of the Proposed Acquisition.