FINANCIAL PERFORMANCE
In FY2014, the Group recorded S$35.4 million full year profit
after tax and non-controlling interests. Revenue and operating
profit after tax and non-controlling interest for our continuing
operations were S$433.8 million and S$35.4 million respectively.
[For FY2013 it was S$416.0 million and S$30.4 million
respectively.]
The gross margin in FY2014 improved to 29% compared to 27%
for FY2013 for continuing operations of the Group. The Group
received orders of S$461.6 million in FY2014 and ended the
year with an outstanding order balance of S$255.0 million for
continuing operations.
The Group in FY2014 generated net cash from operating
activities of S$10.7 million, representing 30.5% of profit after tax
in FY2014, the Group now has a net cash of S$23.4 million at the
end of FY2014.
In FY2014, the continuing operations in the geographical
regions of Asia-Pacific, the Americas and Europe/Middle East/
Africa contributed 39.1%, 50.7% and 10.2% to revenue and
54.7%, 41.3% and 4.0% to profit after tax and non-controlling
interests respectively.
BUSINESS OVERVIEW
CSE will continue to operate and enhance its businesses
in Asia-Pacific, Middle East, Africa, Europe, Mexico and
the United States of America. CSE will organically grow its
engineering integration services business, providing solution/
service to customers in oil and gas (78%), mining and minerals
(10%) and infrastructure (utilities and transportation) (12%)
industries. CSE, with a team of 1,383 staff, operates a network
of 30 offices in 17 countries. CSE operates in three business
segments: automation (75%), telecommunications (24%) and
environmental (1%).
With a net cash position at end of FY2014, the Group will
be able to continue its current strategy of geographical
expansion and addition of complementary capabilities through
acquisitions.
OUTLOOK
Major oil and gas companies have announced in recent weeks
a reduction in their capital expenditure and deferral of some
of their planned projects. Hence, the Group expects to face
increased competition for greenfield projects in the oil and gas
industry. However, the market continues to provide pockets of
opportunities for the Group’s businesses in 2015.
The Group has a robust order book of S$255.0m, and expects
to win more orders from its existing customers. In addition, the
Group will continue to focus on cash generation and look for
new growth prospects.
Overall, businesses of our major subsidiaries should remain
resilient. The Group is on track to deliver its medium growth
projectory through a combination of organic growth via
meeting its existing customer needs together with a focused
plan to make acquisitions to close the product, services and
geographic gaps in our current business portfolio.
SHARING WITH SHAREHOLDERS
As part of sharing with our shareholders, the Board of Directors
shall be recommending a final dividend for FY2014 of S$0.015
per share payable on 20 May 2015, subject to shareholders
approval at the AGM on 16 April 2015. Total dividend for
FY2014 is S$0.0275 as CSE has previously declared an interim
dividend of S$0.0125 (paid in August 2014).
AWARDS
On 15th July 2014, CSE was the Gold winner of the Best
Managed Board Award for companies with a market
capitalization of S$300 million to less than S$1 billion, awarded
by the Singapore Corporate Awards.
COMMUNITY SUPPORT
During FY2014, CSE donated to several charitable organisations
which represent a broad spectrum of disadvantaged people
across the various age groups.
Employees including management in CSE Global (Australia)
volunteered their time at the Scitech in addition to continuing
their annual sponsorship. Scitech is a not-for-profit organisation
whose mission is to increase awareness, interest, capability and
participation by all Western Australians in science, technology,
engineering and mathematics.
CSE Asia also contributed to POSB Passion Run for Kids 2014
and Singapore Association of the Visually Handicapped.
CSE WI, our US subsidiary, held their annual Charity Tennis
Tournament with all proceeds going to Texas Children Hospital.
CSE has utilised the Tertiary Institutions Bursary Fund to provide
12 bursaries to students of Singapore Polytechnic and 14
bursaries to students of National University of Singapore and
Nanyang Technology University.
APPRECIATION
On behalf of the Board of Directors, we wish to thank our
employees for their dedication, passion and contribution
towards the Group’s success. Our appreciation also goes to our
customers, business associates as well as our shareholders for
their continuing support in the past year.
We are pleased to report a 16.4%growth in profit to S$35.4 million for CSE in 2014. We also record a strong
order intake of S$461.6 million in 2014, a 27.3%growth over 2013. The focus onmeeting the needs of our
existing customers and on operational effectiveness and efficiencies are beginning to bear fruit. Going
forward, CSEwill continue to support its existing customers and take the pockets of opportunities
that exist in its current markets. CSE is nowa leaner and nimbler organisation providing engineering
integration solution/service to clients in the Oil & Gas, Mining &Minerals and Infrastructure (Utilities
and Transportation) industries in Asia-Pacific, Middle East, Africa, Europe, Mexico and the United States of
America. With a robust order book and a net cash position at the end 2014, CSE iswell positioned to face the
challenges ahead. Our operations remain resilient.
5
ANNUAL REPORT 2014
