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Full Year 2017 Financial Statements and Dividend Announcement

Financials Archive

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Profit & Loss

Balance Sheet

Review of Performance

4th Quarter 2017 (4Q 2017) vs. 4th Quarter 2016 (4Q 2016)

Profit & Loss Statement

IMAS's 4Q 2017 revenue was S$406.5 million as compared to S$382.4 million in 4Q 2016. Higher revenue was mainly due to higher trucks and heavy duty equipment sales, vehicle servicing and car rental related income. The Group (excluding IMAS) registered lower revenue of S$40.3 million as compared to S$45.4 million in the previous period and was mainly due to absence of factory sales in the current period as compared to S$4.1 million in 4Q 2016. The Consolidated Group revenue was S$446.8 million, 4% higher than 4Q 2016's S$427.8 million.

IMAS's 4Q 2017 cost of sales was S$321.6 million as compared to S$309.7 million in 4Q 2016. The Group's (excluding IMAS) cost of sales was S$33.5 million as compared to S$33.4 million in 4Q 2016. In line with the revenue, the Consolidated Group's cost of sales increased from S$343.1 million in 4Q 2016 to 4Q 2017's S$355.1 million. The Consolidated Group's cost of sales to revenue ratio was 0.79 in 4Q 2017 as compared to 0.80 in 4Q 2016. The Consolidated Group's gross profit was S$91.7 million in 4Q 2017 as compared to S$84.7 million in 4Q 2016 and was in line with higher revenue.

IMAS's 4Q 2017 "other income" was S$75.7 million as compared to S$26.5 million in 4Q 2016 and was mainly due to higher fair value revaluation gain on the investment properties of S$54.4 million as compared to S$14.6 million in the previous period. The Group's (excluding IMAS) "other income" was S$0.8 million income as compared to S$224.9 million income in 4Q 2016 and was mainly due to the gain from divestment of the Shanghai Lao Xi Men Project in the previous period. The Consolidated Group's "other income" was S$20.5 million in 4Q 2017 as compared to 4Q 2016's S$236.8 million. The IMAS's fair value revaluation gain on its investment properties was not taken into the Consolidated Group as the Group adopts cost method for its investment properties.

IMAS's 4Q 2017 "general and administrative expenses" was S$37.6 million as compared to S$37.7 million in 4Q 2016. The Group's (excluding IMAS) "general and administrative expenses" was S$7.6 million as compared to 4Q 2016's S$9.1 million and was mainly due to lower manpower costs. The Consolidated Group's "general and administrative expenses" was S$50.7 million as compared to 4Q 2016's S$52.2 million.

IMAS's 4Q 2017 "other operating expenses" was S$32.9 million as compared to 4Q 2016's S$33.6 million and was mainly due to lower manpower costs. The Group's (excluding IMAS) "other operating expenses" was S$6.7 million as compared to 4Q 2016's S$21.6 million and was mainly due to the write off of goodwill and assets of S$15.2 million in the previous period. The Consolidated Group's "other operating expenses" was S$39.6 million as compared to 4Q 2016's S$88.7 million which included a write off of associates of S$33.5 million.

The Consolidated Group's 4Q 2017 "share of associated companies' result" was S$12.7 million loss as compared to 4Q 2016's S$7.7 million loss and was mainly due to higher losses from the automotive associated companies.

IMAS's 4Q 2017 "finance costs" was S$24.4 million as compared to 4Q 2016's S$22.2 million and the Group's (excluding IMAS) "finance costs" was S$9.6 million as compared to 4Q 2016's S$11.1 million. The Consolidated Group's "finance costs" was S$34.0 million as compared to S$33.3 million in 4Q 2016.

IMAS's 4Q 2017's net profit was S$44.0 million as compared to S$9.3 million net loss in 4Q 2016 and was mainly due to fair value revaluation gain from its investment properties. The Group's (excluding IMAS) was a net loss of S$21.6 million as compared to S$187.0 million profit in 4Q 2016 and was mainly due to S$220.6 million gain from divestment of the Shanghai Lao Xi Men Project. The Consolidated Group's net loss attributable to equity holders of the Company was S$33.1 million for 4Q 2017 as compared to 4Q 2016's profit of S$144.7 million.

12 Months 2017 (FY 2017) vs. 12 Months 2016 (FY 2016)

Profit & Loss Statement

IMAS's FY 2017 revenue was S$1,593.7 million as compared to FY 2016's S$1,555.3 million. Higher revenue was mainly due to higher trucks and heavy duty equipment sales, financial services and car rental related income. The Group (excluding IMAS) registered lower revenue of S$158.9 million as compared to FY 2016's S$160.5 million and was mainly due to absence of factory sales but was partially mitigated by higher revenue from utilities and resort segment. The Consolidated Group revenue was S$1,752.6 million, representing 2% higher than FY 2016's S$1,715.8 million.

IMAS's FY 2017 cost of sales was S$1,276.6 million as compared to FY 2016's S$1,279.7 million. The Group's (excluding IMAS) cost of sales was S$132.6 million as compared to FY 2016's S$128.3 million. The Consolidated Group's cost of sales was S$1,409.2 million, lower than FY 2016's S$1,408.0 million. The Consolidated Group's cost of sales to revenue ratio was 0.80 in FY 2017 as compared to 0.82 in FY 2016. Accordingly and in line with higher revenue, the Consolidated Group registered higher gross profit of S$343.3 million in FY 2017 as compared to S$307.8 million in FY 2016.

IMAS's FY 2017 "other income" was S$121.1 million as compared to FY 2016's S$63.4 million and was mainly due to higher interest income and fair value revaluation gain on its investment properties as compared to the previous period. The Group's (excluding IMAS) "other income" was S$7.1 million expenses as compared to FY 2016's S$235.0 million income and was mainly due to foreign currency translation losses on the USD remittance from the divestment of the Shanghai Lao Xi Men Project and the S$220.6 million gain from divestment of the Shanghai Lao Xi Men Project in FY 2016.

Accordingly, the Consolidated Group's "other income" was S$58.6 million in FY 2017 which was lower than FY 2016's S$281.7 million. The IMAS's fair value revaluation gain on its investment properties was not taken into the Consolidated Group's as the Group adopts cost method for its investment properties.

IMAS's FY 2017 "general and administrative expenses" was S$145.4 million as compared to S$132.4 million in FY 2016 and was mainly due to higher provision for doubtful debts. The Group's (excluding IMAS) "general and administrative expenses" was S$19.8 million as compared to FY 2016's S$22.1 million was mainly due to lower manpower related costs. The Consolidated Group's "general and administrative expenses" was S$186.7 million as compared to FY 2016's S$175.3 million.

IMAS's FY 2017 "other operating expenses" was S$129.7 million as compared to FY 2016's S$132.3 million. Lower expenses were mainly due to lower manpower costs and partially offset by impairment loss on foreclosed assets. The Group's (excluding IMAS) "other operating expenses" was S$25.4 million as compared to S$38.5 million in FY 2016 and was mainly due to write off of goodwill and assets in the previous period. The Consolidated Group's "other operating expenses" was S$155.1 million as compared to FY 2016's S$204.3 million and was mainly due to the impairment on investment in associated companies of S$33.5 million in the previous period.

The Consolidated Group's FY 2017 "share of associate's results" was S$56.3 million loss as compared to FY 2016's S$13.7 million loss and was mainly due to higher losses from automotive associated companies.

IMAS's FY 2017 "finance costs" was S$91.9 million as compared to S$83.5 million in FY 2016 and the Group's (excluding IMAS) "finance costs" was S$36.8 million as compared to S$49.2 million in FY 2016. The Consolidated Group's "finance costs" was S$128.7 million as compared to S$132.7 million in FY 2016 and was mainly due to repayment of external bank borrowings and redemption of bond of the Company's 2017 EMTN.

IMAS's FY 2017 net loss was S$6.8 million as compared to S$32.2 million in FY's 2016 and was mainly due to higher fair value revaluation gain on its investment properties but was offset by higher losses from the associated companies. The Group's (excluding IMAS) net loss was S$76.6 million as compared to S$140.8 million profit in FY 2016 and was mainly due to S$220.6 million gain from divestment of the Shanghai Lao Xi Men Project in FY 2016. The Consolidated Group's net loss attributable to equity holders of the Company was S$135.7 million in FY 2017 as compared to FY 2016's net profit of S$72.2 million.

Balance Sheet

The Group's total assets of S$4,514.7 million, as at 31 December 2017, were S$245.5 million lower than as at the previous year end. Other non-current assets decreased by S$2.6 million mainly due to the decline in value of the Group's quoted equity investments. Current assets decreased by S$181.7 million to S$2,111.9 million and was mainly due to decrease in cash and bank balances after repayment of bank borrowings and redemption of 2017 / 2018 EMTNs during the period under review.

The Group' total liabilities of S$2,800.4 million, as at 31 December 2017, were S$93.0 million lower than the previous year-end and was mainly due to the redemption of the Company's EMTN. The Group's borrowings and debt securities as at 31 December 2017 were S$2.3 billion of which S$1.0 billion relates to IMAS' car rental and financial services business.

Cash Flow Statement

Net cash used in operating activities was S$11.9 million as compared to S$57.5 million in the previous period.

Net cash used in investing activities was S$156.0 million and was mainly due to capital expenditure.

Net cash generated from financing activities was S$12.1 million mainly from the proceeds from bank borrowings.

Commentary On Current Year Prospects

While IMAS's truck and heavy duty equipment, financial services, car rental, and spare parts and servicing businesses have all registered good growth, improved contributions from passenger vehicle sales segment is expected to improve only towards 2nd half of 2018 and into Year 2019 in line with the timing of new product launches.

We are repositioning our industrial parks business to higher value added business activities. Strong tourist arrival into Bintan will continue to be the key growth factor and the Group will leverage on this momentum to accelerate commercial land sales in Bintan.