Investor Relations

Tye Soon is listed on the Main Board of the Singapore Exchange. For our shareholders and partners, we would like to provide an easy access to relevant information concerning our Group in this page.  We hope the information will give you a better understanding of our group.

The Group’s Performance

The Group managed to retain some stability and maintained its level of business in a challenging year, registering a slight increase in turnover of $0.4 million to $201.4 million. Total margins decreased by $1.1 million as the increase in margins from the slightly higher turnover was offset by a decline in the gross margin rate. Overall operating expenses decreased by $1.2 million during the year.

Group profitability, however, was affected by the substantial decrease in other income by $2.4 million. As announced previously, the Group had entered into a sale and leaseback arrangement for the property in Jurong East in Singapore in FY12. The leaseback period ended on 30 January 2015. The sale and leaseback transaction involved a deferred income of $4.5 million to be amortised over a three-year leaseback period. The amortization at the rate of $1.5 million per year ended on 30 January 2015. The amount of deferred income recognized in FY15 was therefore $1.4 million less than in FY14. As the Group also decided not to remain as the master lessee for the premises at the time of the expiry of the original leaseback period, the Group’s rental income from sub-lessees ceased. In comparison with FY14, rental income decreased by $1.1 million in FY15.

As a result, profit from operations (PBIT) decreased from $5.7 million to $3.3 million, and profit before tax decreased from $4.0 million to $1.1 million.

Details relating to the performance of the business are set out in the Business Review section of this Annual Report.

Current Year Prospects

The broader economic outlook does not appear helpful as the IMF has recently announced yet another downgrade to global growth. Despite this backdrop, the Group is confident that its business will remain resilient as the wide overseas distribution network built over the years provides a robust platform from which to build itself from the current level. The Group’s operational performance in the current year will largely ride on the continuing performance in Malaysia and South Korea, as well as depend on the recoveries in Singapore and Australia.

A substantial level of resources has been committed to build and operate the distribution network. The Group is conscious of the need to balance its profitability objectives against continuing development, which invariably involves start-up costs to some extent. The Group will review its cost base and various aspects of its business to achieve a higher level of operational efficiency, trimming and containing costs wherever feasible.

It was first announced on 17 March 2015 that the Group had entered into a put and call option agreement to sell its properties at Waterloo Centre in Singapore. The call option was exercised by the purchaser on 30 September 2015 and completion took place on 1 March 2016. The gain from this sale amounted to $7.9 million. Based on this gain as well as the expected improvement in operational profit, the Group’s profitability is expected to improve.

The Way Forward

The Group remains focused in pursuing its strategic business direction in expanding its geographical footprint in Asia. Partnering principals mostly from Europe, Japan and Korea, a key element of the Group’s strategy would be to make available one of the largest portfolio of top-tier global brands of automotive parts to customers located throughout Asia.

chairman

Mr Ong Hock Siang,
Chairman, Tye Soon Limited