Lincotrade and Associates Holdings BFT , formerly Fabchem China, has reported a loss of $9.5 million for the 1HFY2023 ended Dec 31, 2022, down from the $251,000 in earnings in the same period the year before.
The loss was mainly due to the surge in other losses, which includes the one-off non-cash reverse takeover (RTO) expense of around $10.8 million. The amount comprises $9.6 million in RTO expenses and $1.2 million in share-based payments to the group’s sponsor and arranger. Lincotrade, an interior fitting out service provider, began trading on the Catalist board in August 2022 after the $25 million RTO by Fabchem China, which was an explosives maker.
Loss before tax stood at $9.0 million. Excluding the RTO expenses, the group actually registered a profit before tax of $1.7 million.
During the period, the group’s revenue surged by 119.3% y-o-y to $40.9 million. The higher revenue was due to higher revenue recognised for the commercial and showflat segments but partly offset by lower revenue from the residential segment.
Cost of sales, too, surged by 123.8% y-o-y to $36.6 million in tandem with the higher revenue.
Gross profit grew by 87.4% y-o-y to $4.3 million although gross profit margin (GPM) fell 1.8 percentage points y-o-y to 10.5% in the 1HFY2023. The lower gross profit margin was mainly due to the lower gross profit margin for the residential and showflats segments, partially offset by the higher gross profit margin from the commercial segment. The higher proportion of revenue from showflats also lowered the group’s overall GPM.
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Interest income surged six times to $12,000 from $2,000 in the same period the year before mainly from the fixed deposits placed with banks.
Other income and gains fell by 71.0% y-o-y to $29,000 as government grants decreased during the period.
Administrative expenses increased by 77.3% y-o-y to $1.5 million due to higher employee benefits.
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Other expenses increased by 36.5% y-o-y to $804,000 mainly due to higher transportation expenses and utilities expenses in line with the revenue increase.
Loss per share stood at 5.87 cents on a diluted basis.
As at Dec 31, 2022, cash and cash equivalents stood at $12.2 million.
No dividend was declared for the period.
Shares in Lincotrade closed flat at 13 cents on Feb 13
