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Financials

Financial Statements For The Second Half Year And Full Year Ended 31 December 2025

Financials Archive

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CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

CONDENSED INTERIM BALANCE SHEETS

Review of Performance

Review of Statement of Comprehensive Income

Revenue

The Group's total revenue decreased by $7.15 million or 13%, from $53.49 million in FY2024 to $46.34 million in FY2025. The reduction primarily reflected softer activity levels and project timing differences across the Group's business segments during the year, as customers remained cautious in project commencement and maintenance spending.

The decline was recorded across all three business segments:

• Marine segment - decreased by $3.57 million;
• Offshore & Engineering ("O&E") segment - decreased by $2.20 million; and
• Energy Services segment - decreased by $1.38 million.

Revenue for 2HY2025 decreased by $6.70 million or 24%, from $28.03 million in 2HY2024 to $21.33 million, mainly reflecting lower new build deliveries and business services activities during the period.

Offshore & Engineering ("O&E") segment

Revenue from the O&E segment represented 6% of total revenue in FY2025 (FY2024: 10%).

Revenue from the O&E segment decreased to $3.02 million in FY2025, from $5.22 million in FY2024, a decline of $2.20 million or 42%, mainly due to:

• Absence of charter income of $0.72 million in FY2025; and
• Revenue of $0.98 million recognised in FY2024 from a China subsidiary as a result of internal restructuring compared to $68,000 in FY2025.

Partially offset by:

• An increased revenue contribution of $0.22 million from precision engineering activities.

This also explains the variation in the O&E segment revenue in 2HY2025 compared to 2HY2024.

Marine segment

Revenue from the Marine segment represented 50% of total revenue in FY2025 (FY2024: 50%).

The revenue from the Marine segment decreased to $23.12 million in FY2025, from $26.69 million in FY2024, mainly reflecting lower activity levels and delivery timing across propulsion equipment and related services during the year. This was mainly attributable to:

• Lower deliveries of new-build propellers of approximately $1.78 million;
• $1.28 million reduction from MRO services; and
• $0.51 million decline from shipyard activities.

This also explains the variation in the Marine segment revenue in 2HY2025 compared to 2HY2024.

Energy Services segment

Revenue from the Energy Services segment represented 44% of total revenue for FY2025 (FY2024: 40%).

Revenue decreased to $20.21 million in FY2025, from $21.59 million in FY2024, a decrease of $1.38 million or 6%, mainly due to:

• Lower contribution from a certain trading-related order, which was $1.57 million in FY2025, down from $4.46 million in FY2024; and

Offset with

• Higher revenue from waste treatment and collection activities of approximately $1.51 million.

In 2HY2025, the revenue recognition of the trading-related order of $1.07 million (2HY2024: Nil) helped offset the decline in revenue from the waste treatment and collection activities.

Cost of sales, gross profit ("GP") and gross profit margin

The Group's total cost of sales (COGS) in FY2025 decreased by $1.66 million, from $37.67 million in FY2024 to $36.01 million, in line with the lower activity across the segments. Consequently, gross profit decreased by $5.48 million, from $15.82 million in FY2024 to $10.34 million in FY2025, and gross profit margin fell from 30% to 22%.

The following factors contributed to the change in gross profit:

Offshore & Engineering ("O&E") segment: COGS was $4.33 million (FY2024: $5.39 million), resulting in a gross loss of $1.31 million (FY2024: $0.18 million). No charter income was recognised during FY2025, while fixed depreciation and vessel upkeep costs continued to be incurred. In addition, vessel recovery-related costs were recognised during the year, which are not expected to arise in the ordinary course of operations. These were partially mitigated by positive contributions from precision engineering activities.

This also accounts for the variation in the O&E segment's gross loss between 2HY2025 and 2HY2024.

Marine segment: COGS in FY2025 was $16.03 million (FY2024: $14.40 million), generating gross profit of $7.09 million (FY2024: $12.28 million) and a GP margin of 31%. The decline was mainly due to lower deliveries of new-build propellers, lower MRO services, and a decrease in shipyard activities.

This also explains the variation in the Marine segment's gross profit between 2HY2025 and 2HY2024.

Energy Services segment: In FY2025, COGS was $15.65 million (FY2024: $17.87 million), resulting in a gross profit of $4.56 million (FY2024: $3.71 million) and a GP margin of 23% (FY2024: 17%). The increase in gross profit and gross profit margin in FY2025 was largely attributable to stronger margins from by-product sales.

In 2HY2025, gross profit declined to $1.98 million (2HY2024: $2.84 million), with a GP margin of 20% (2HY2024: 27%), mainly due to lower waste treatment and collection activities.

Administrative expenses

Administrative expenses increased by $0.92 million or 9% to $10.87 million in FY2025 (FY2024: $9.95 million), and by $0.68 million or 14% to $5.60 million in 2HY2025 (2HY2024: $4.92 million). The increase was mainly due to higher headcount costs and professional fees incurred in the Marine segment, supporting the ongoing transformation of the propulsion business.

Finance expenses

Finance expenses decreased by $2.07 million or 32% to $4.34 million in FY2025 (FY2024: $6.41 million), mainly attributable to lower outstanding borrowings following scheduled principal repayments and improved borrowing rates during the year.

This also explains the fluctuation in finance expenses in 2HY2025 compared to 2HY2024.

Share of loss of associated companies

The Group and the Company's share of losses in its associated company have exceeded its carrying amount as at FY2023. Accordingly, no further share of losses was recognised in FY2025.

(Loss)/profit before income tax

Consequent to the above, the Group recorded a loss before income tax of $4.07 million in FY2025, compared to a profit before income tax of $2.79 million in FY2024. The loss was mainly attributable to lower activity levels and project timing differences across the business segments, as well as certain non-recurring items recognised during the year, including impairments and vessel recovery-related costs, which are not expected to arise in the ordinary course of operations.

For 2HY2025, the Group reported a loss before income tax of $3.57 million, compared to a profit before income tax of $3.15 million in 2HY2024.

Review of Balance Sheet

Current assets

As at 31 December 2025, the Group's current assets stood at $92.40 million, representing a decrease of $8.95 million, or 9%, from $101.35 million as at 31 December 2024.

The decrease was mainly attributable to:

• Cash and cash equivalents: decreased by $2.30 million, from $10.16 million to $7.86 million, consistent with the net cash outflows explained in the Review of Condensed Interim Consolidated Statement of Cash Flows.
• Trade and other receivables: decreased by $4.09 million, from $14.41 million to $10.32 million, mainly due to higher collections, the write-off of $1.33 million relating to a customer in the Offshore & Engineering segment following its compulsory liquidation (previously recognised a loss allowance in 1HY2025), and the overall decline in revenue across all business segments, which led to a lower level of receivables at year-end.
• Inventories: declined by $1.40 million, from $5.02 million to $3.62 million, reflecting a lower volume of secured and ongoing orders for new-build propellers in the Marine segment.
• Contract assets: reduced by $1.16 million, from $1.21 million to $54,000, following the billing and collection in January 2025 of work completed in 4Q2024.
• Assets of disposal group classified as held-for-sale: remained unchanged at $70.54 million.

Non-current assets

As at 31 December 2025, the Group's non-current assets stood at $67.93 million, representing a decrease of $6.49 million, or 9%, from $74.42 million as at 31 December 2024:

The decrease was mainly attributable to:

• Property, plant, and equipment (PPE) and deposit for purchase of PPE: net decrease of $7.20 million in PPE, from $68.08 million to $60.88 million, as detailed in Part E, Note 12. This was partially offset by an increase in deposits for PPE from $1.44 million to $2.15 million, for capital investments in the Marine segment.
• Financial assets, at FVOCI: recorded a fair value gain of $5,000.
• Other non-current assets: comprising goodwill and investment in an associated company, remained unchanged during FY2025.

Current liabilities

As at 31 December 2025, the Group's current liabilities stood at $84.19 million, representing a decrease of $3.04 million, or 3%, from $87.24 million as at 31 December 2024.

The reduction was primarily due to:

• Trade and other payables: decreased by $1.02 million, from $9.66 million to $8.64 million, primarily due to settlement of outstanding payables and lower expense accruals from reduced business activity.
• Contract liabilities: reduced by $0.65 million, from $2.66 million to $2.01 million, mainly due to the recognition of revenue from previously billed contract advances in the Marine segment.
• Borrowings:: decreased by $0.38 million, from $7.70 million to $7.31 million, primarily due to the full repayment of unsecured loans, partially offset by new secured borrowings under lease liabilities (hire purchase) and higher utilisation of trade financing facilities.
• Current income tax liabilities: reduced from $0.47 million to $4,000, following tax payments and the under-provision of $4,000 in FY2025 payable in 1Q2026. No current provision for FY2025 as the Group has unutilised tax losses and capital allowances to offset taxable income.
• Liabilities directly associated with disposal group classified as held-for-sale: decreased by $0.52 million, from $66.75 million to $66.23 million, mainly relating to lease liabilities on leasehold land.

Non-current liabilities

As at 31 December 2025, the Group's non-current liabilities stood at $44.73 million, representing a decrease of $8.89 million, or 17%, from $53.62 million as at 31 December 2024.

The decrease was mainly attributable to:

• Borrowings: decreased by $8.63 million, from $51.54 million to $42.90 million, following scheduled repayments of long-term loans and lease liabilities.
• Deferred income tax liabilities: reduced by $0.26 million, from $2.08 million to $1.82 million, reflecting the movement of temporary differences and tax depreciation on certain assets.

Review of Condensed Interim Statement of Cash Flows

For FY2025, the Group's cash and cash equivalents decreased by $2.32 million, closing at $7.32 million (FY2024: $9.64 million). The movement mainly reflected financing and investing outflows, while operating activities continued to generate positive cash inflows during the year.

• Operating activities: Net cash provided by operating activities amounted to $13.91 million in FY2025, compared with $17.79 million in FY2024. The decrease was mainly attributable to the Group's net loss of $3.61 million, along with non-cash adjustments such as depreciation, impairment losses, and interest expenses. Movements in working capital, including trade receivables, inventories, and contract assets, contributed positively to cash. Net payments of income tax of $0.27 million partially offset cash inflows from operations.
• Investing activities: Net cash used in investing activities totalled $1.84 million in FY2025, mainly due to purchases of PPE of $3.25 million, partially offset by proceeds from the disposal of PPE of $1.40 million. In contrast, FY2024 recorded a net cash inflow of $0.17 million, supported by asset-related government grants of $1.05 million and final-tranche proceeds of $1.03 million from the disposal of Vac-Tech, partially offset by purchases of PPE of $2.24 million.
• Financing activities: Net cash used in financing activities was $14.38 million in FY2025, compared to $18.27 million in FY2024. The decrease in cash outflow was mainly due to lower repayments of bank borrowings and lease liabilities, as well as reduced interest payments arising from lower outstanding loan balances and improved borrowing rates.

Commentary

During FY2025, business conditions were uneven amid geopolitical uncertainties and cost volatility, which influenced customer procurement behaviour across the Group's operating segments. The Group's performance for the year was affected by certain one-off items, including a debt impairment, impairment loss on a vessel and expenses relating to vessel recovery. Excluding these items, operating activity across the segments reflected softer demand and project timing differences, as customers remained cautious in project commencement and maintenance spending. Management expects overall business conditions for the next 12 months to remain challenging, with performance influenced by market demand and movements in materials and operating costs.

Offshore & Engineering (O&E).

The segment remains focused on engineering, inspection and maintenance services for offshore structures, with operations primarily based in Singapore. Following the streamlining of activities to its core service areas, the Group is undertaking measured efforts to enhance sales in selected precision engineering works where margins are relatively favourable. Contribution from this segment is expected to remain modest in the near term, given its current operational scope.

Marine.

Deliveries of new-build propellers contributed to activity levels during the year, although order visibility remains uneven and may fluctuate with broader market conditions and project timing.

Demand for repair and maintenance activities may continue to be influenced by yard utilisation patterns and docking schedules in Singapore, including industry consolidation and prioritisation of higher-value projects, which may affect the timing of discretionary repair scopes. The Group continues to align its service offerings with customers' maintenance planning cycles, and activity levels are expected to remain dependent on vessel operating requirements and class maintenance cycles.

Energy Services.

Waste collection activities and waste-to-by-product recovery remain the primary drivers of the segment and are expected to provide steady contributions, although revenue may vary between reporting periods depending on the timing of orders fulfilled. Operational focus will remain on improving plant efficiency, managing disposal costs and optimising by-product recovery to enhance margins.

Group priorities.

The Group remains committed to prudent cost management, operational efficiency and active engagement with customers and partners to secure sustainable revenue streams.