NEWS RELEASE
TECKWAH TURNS IN $4.9 MILLION NET PROFIT AFTER TAX
Contributions generated by print related business and newly acquired logistics business
SINGAPORE, 23 February 2005 – Main board listed value chain services provider,
Teckwah Industrial Co., Ltd (“Teckwah” or “the Group”) today announced revenues of
$145.7 million and net profit after tax of $4.9 million for the financial year ended 31
December 2004.
Relative to its performance in the previous financial year, revenue for the year rose 20% .
Pretax profits were also higher rising from $5.6 million in FY2003 to $8.6 million in FY2004
due to the inclusion of an extraordinary gain of $3.2 million arising from the sale of the
Group’s flagship building, TIC Tech Centre. In FY2004 net profit after tax declined 7%
compared to $5.3 million in the previous financial year.
Contributing to Teckwah’s performance for the year under review were the revenue
contributions from its print related business and the recognition of one quarter’s revenues
from its newly acquired logistics business – JNE Logistics Singapore Pte Ltd (“JNE”).
Revenues from the print related business and JNE amounted to $136.5 million and $2.8
million in FY2004 respectively. The Group’s performance was however affected by the loss
incurred by its online business, Teckwah Online (“TWO”), due to the start-up costs and the
prolonged negotiations of good contents for Noribox, its new digital distribution platform.
By segmental analysis, contribution from the print related business continues to dominate
accounting for about 94% of the Group’s aggregate revenue. The balance comprises
contributions from the non print business which include revenue streams from JNE and
TWO. In FY2004, non print business revenues rose 76% to $8.6 million.
Geographically, Singapore remained the largest revenue generator accounting for 67% of
Teckwah’s total revenue. This is followed by revenue contributions from the People’s
Republic of China (“China”) that accounted for about 21% of the Group’s revenues. The
balance comprises contributions from other countries including Malaysia, Indonesia and
Thailand. With the exception of Japan which is a newly established operation, all overseas
offices operated profitably.
Teckwah Industrial Corporation Ltd
25 Pandan Crescent #05-15
TIC Tech Centre Singapore 128477
Tel 65 6872 8181 Fax 65 68728199
www.teckwah.com.sg
a Singapore Quality Class company
The Group’s cash flow from operations, prior to working capital adjustments amounted to
approximately $12 million. However, reflecting the Group’s move to reduce its debt, net cash
flow from operations was reduced to a negative $5.3 million due to the prepayment of trade
payables that allowed the Group to enjoy pre-payment discounts and at the same time
mitigate foreign exchange risks. Furthermore, the Group also made an advance payment for
the royalty fees relating to contents and technology licensing costs incurred by TWO.
The sale of the building and used machineries in FY2004 generated cash amounting to $49
million. Of this total, $21 million and $7 million were deployed to repay bank borrowings
and purchase new machinery and equipment. Another $2.0 million was used to acquire JNE.
Taking into account the above deployment of funds, the Group ended the year with a net
positive cash flow balance of $4 million and correspondingly its gearing also declined
significantly from 0.34 in FY2003 to 0.06 in FY2004.
Commenting on the performance of Teckwah in FY2004, Mr Thomas Chua – Chairman and
CEO said: “Having divested our flagship building and reduced our debt, Teckwah is now
armed with a strong balance sheet that will enable us to drive our business forward. We will
now be able to divert our resources to investments that are synergistic with the ability to yield
good returns for the Group.”
On the business outlook for FY2005, Teckwah is optimistic about the prospects from both the
print related and the logistics business. In particular would be the recognition of the full
year’s contribution from JNE. On the other hand the Group feels that the challenge will likely
arise from its online business. Having invested FY2004 to set up the infrastructure and lay the
ground work for TWO and Noribox, both are now recognized names in the regional markets
where they operate. Nonetheless, the Group still needs time to adapt its present online
business model to suit the needs of different markets in the region.
Commenting on the Group’s strategy for its online business, Mr Thomas Chua – Chairman
and CEO said: “In the new financial year, we will be expanding our current business model
from a B2B to a B2C platform. Both TWO and Noribox have the abilities to transcend from
their current B2B platforms into B2C platforms. With this move, we will be able to realize
more opportunities for our online business across the region.”
To commemorate the 10th anniversary of Teckwah’s public listed status and reward
shareholders for their confidence and support over the years, the Board recommends a first
and final ordinary dividend of 6% plus a special dividend of 4% for the financial year ended
31 December 2004, subject to the approval of the shareholders at the forthcoming Annual
General Meeting.
Teckwah Industrial Corporation Ltd
25 Pandan Crescent #05-15
TIC Tech Centre Singapore 128477
Tel 65 6872 8181 Fax 65 68728199
www.teckwah.com.sg
a Singapore Quality Class company
About Teckwah Industrial Corporation Ltd
Teckwah was established in 1968 as a producer of packaging boxes. Over the years, the
Group’s businesses have evolved into an integrated value chain service provider. The Group
currently employs more than 1,000 employees. Singapore serves as the business and
operational headquarters for the Group. The Group’s network spans many countries across
Asia Pacific including Malaysia, China, Korea, Taiwan, Thailand, Japan, Australia and New
Zealand.
The shares of Teckwah are quoted on the mainboard of the Singapore Exchange Securities
Trading Limited.
For more information please visit: www.teckwah.com.sg
For enquiry please contact:
Tan Peck Hwa
Asia Business Channels Pte Ltd
Tel: 6749 8871 / 9635 4996
email: tphcomms@singnet.com.sg
.
Teckwah Industrial Corporation Ltd
25 Pandan Crescent #05-15
TIC Tech Centre Singapore 128477
Tel 65 6872 8181 Fax 65 68728199
www.teckwah.com.sg
a Singapore Quality Class company