EX-99.1 2 ex99-1.htm

 

Exhibit 99.1

 

SAG Holdings Limited and Subsidiaries

 

Summary of Consolidated Financial and Other Data

 

   Six Months ended June 30, 
   2024   2023 
   $’000   $’000 
     
Revenues   27,900    31,034 
Income from operations   1,799    1,658 
Net income   1,676    1,351 
           
Net income per share   0.19    0.15 
Number of shares outstanding (’000)   9,000    9,000 

 

●Revenue decreased by approximately $3.1 million or 10.1% to approximately 27.9 million for the six months ended June 30, 2024 from approximately $31.0 million for the six months ended June 30, 2023.
●Income from operations increased by approximately $0.1 million to approximately $1.8 million for the six months ended June 30, 2024 from approximately $1.7 million for the six months ended June 30, 2023.
●Net income was approximately $1.7 million for the six months ended June 30, 2024 as compared approximately $1.4 million for the six months ended June 30, 2023.
●Net income per share was $0.19 as of June 30, 2024, compared to $0.15 as of June 30, 2023.

 

Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

For the six months ended June 30, 2024 and 2023, our net revenue amounted to approximately $27.9 million and approximately $31.0 million, respectively, of which On-Highway Business accounted for approximately $12.4 million for the six months ended June 30, 2024 and approximately $13.9 million for the six months ended June 30, 2023, Off-Highway Business accounted for approximately $15.5 million for the six months ended June 30, 2024 and approximately $17.1 million for the six months ended June 30, 2023, and services (in the form of shipping charges) accounted for approximately $0.03 million for the six months ended June 30, 2024 and approximately $0.04 million for the six months ended June 30, 2023.

 

Our net income amounted to approximately $1.7 million and $1.4 million for the six months ended June 30, 2024 and 2023, respectively.

 

Revenue

 

As set forth in the following table, during the six months ended June 30, 2024 and 2023, our revenue was derived from the sale of products in our On-Highway Business serving the automotive sector, our Off-Highway Business serving the industrial sector, and in the provision of services (in the form of shipping charges):

 

   Six Months ended June 30, 
   2024   2023 
   $’000   %   $’000   % 
         
Revenue                    
On-Highway   12,373    44.3    13,880    44.7 
Off-Highway   15,499    55.6    17,115    55.2 
Services (shipping charges)   28    0.1    39    0.1 
                     
Total   27,900    100.0    31,034    100.0 

 

 
 

 

Our total revenue decreased by approximately $3.1 million or 10.1% to approximately $31.0 million for the six months ended June 30, 2024, from approximately $31.0 million for the six months ended June 30, 2023. Such decrease was mainly attributable to the decreased demand in our Off-Highway Business and On-Highway Business of approximately $1.6 million and approximately $1.5 million. Such decrease was mainly due to the decrease in oversea sales.

 

The total revenue of our On-Highway Business decreased by approximately $1.5 million to approximately $12.4 million for the six months ended June 30, 2024 from approximately $13.9 million for the six months ended June 30, 2023. Such decrease was mainly due to the decrease in oversea sales.

 

The total revenue for our Off-Highway Business decreased by approximately $1.7 million to approximately $15.5 million for the six months ended June 30, 2024, from approximately $17.1 million for the six months ended June 30, 2023. Such decrease was mainly due to the decrease in oversea sales.

 

For the six months ended June 30, 2024 and 2023, our net income amounted to approximately $1.7 million and $1.4 million, respectively. The net income for the six months ended June 30, 2024 was mainly due to the increase in gross profit margin.

 

For the six months ended June 30, 2024 and 2023, approximately 37.3% and 45.8% of our total revenue, respectively, was generated from our customers located in Singapore and approximately 10.9% and 9.2% of our total revenue, respectively, was generated from customers located in the Middle East. For the same periods, our revenue generated from customers located in other countries accounted for approximately 51.8% and 45.0% of our total revenue, respectively.

 

Revenue by geographical locations

 

During the six months ended June 30, 2024 and 2023, the customers for our On-Highway Business products and Off-Highway Business products were mainly located in Singapore and the Middle East. The following table sets out a breakdown of our revenue by geographic location of our customers for the six months ended June 30, 2024 and 2023:

 

   Six Months ended June 30, 
   2024   2023 
   $’000   %   $’000   % 
         
Singapore                    
On-Highway   2,971    10.6    5,040    16.3 
Off-Highway   7,446    26.7    9,159    29.5 
                     
Total   10,417    37.3    14,199    45.8 

 

   Six months ended June 30, 
   2024   2023 
   $’000   %   $’000   % 
         
Middle East                    
On-Highway   3,027    10.8    2,508    8.1 
Off-Highway   26    0.1    342    1.1 
                     
Total   3,053    10.9    2,850    9.2 

 

 
 

 

   Six Months ended June 30, 
   2024   2023 
   $’000   %   $’000   % 
         
Other Countries(1), individually less than 5%                    
On-Highway   6,302    22.6    6,632    20.4 
Off-Highway   8,100    29.0    7,314    24.5 
Services (shipping charges)   28    0.2    39    0.1 
                     
Total   14,430    51.8    13,985    45.0 

 

  (1) “Other Countries” means Malaysia, Indonesia, Thailand, Hong Kong, Taiwan, Vietnam, Philippines, South Korea, Japan, Australia, India, Pakistan, Sri Lanka, African and Latin America.

 

Singapore

 

The revenue in Singapore decreased by approximately $3.8 million, the six months ended June 30, 2024, as compared to the corresponding period ended June 30, 2023, which was primarily attributable to the decrease in demand from local customers.

 

The revenue for our On-Highway Business decreased by approximately $2.1 million, for the six months ended June 30, 2024, as compared to the corresponding period ended June 30, 2023, which was primarily attributable to the decrease in demand from local customers.

 

The revenue for our Off-Highway Business decreased by approximately $1.7 million, for the six months ended June 30, 2024, as compared to the corresponding period ended June 30, 2023, which was primarily attributable to the decrease in demand from the local customers.

 

Middle East

 

The increase in revenue in the Middle East by approximately $0.2 million for the six months ended June 30, 2024, as compared to the corresponding period ended June 30, 2023, which was primarily attributable to the increase in sale orders from our customers.

 

The revenue for our On-Highway Business increased by approximately $0.5 million for the six months ended June 30, 2024, as compared to the corresponding period ended June 30, 2023, which was primarily attributable to the increase in sale orders.

 

The revenue for our Off-Highway Business decreased by approximately $0.3 million for the six months ended June 30, 2024, as compared to the corresponding period ended June 30, 2023, which was primarily attributable to the reduced sale orders.

 

Other Countries

 

Revenues from other countries increased by approximately $0.4 million, which was primarily due to higher demand from new and recurring customers among various countries.

 

The revenue for On-Highway Business decreased by approximately $0.3 million, for the six months ended June 30, 2024, as compared to the corresponding period ended June 30, 2023, which was primarily attributable to the decrease in demand from our customers from Malaysia, Indonesia, Hong Kong, Taiwan, South Korea, Australia and India.

 

The revenue for our Off-Highway Business increased by approximately $0.7 million, for the six months ended June 30, 2024, as compared to the corresponding period ended June 30, 2023, which was primarily attributable to the increase in demand from our customers from Malaysia, Indonesia, Thailand, Vietnam, Philippines, Japan, Australia, Pakistan, Sri Lanka, African and Latin America.

 

 
 

 

Cost of revenues

 

During the six months ended June 30, 2024 and 2023, our Group’s cost of revenues was mainly comprised of purchasing finished products for resale. For the six months ended June 30, 2024 and 2023, our cost of revenues decreased by approximately $3.3 million, or 13.1%, from approximately $25.4 million for the six months ended June 30, 2023 to $22.1 million for the six months ended June 30, 2024. This decrease was primarily attributable to the decrease in sales in our Off-Highway Business and On-Highway Business.

 

   Six Months ended June 30, 
   2024   2023 
   $’000   %   $’000   % 
         
On-Highway   9,788    44.3    11,311    44.5 
Off-Highway   12,315    55.7    14,111    55.5 
                     
Total   22,103    100.0    25,422    100.0 

 

Gross profit and gross profit margin

 

The table below sets forth our Group’s gross profit and gross profit margin by business sector during the six months ended June 30, 2024 and 2023:

 

   Six Months ended June 30, 
   2024   2023 
  

Gross

Profit

  

Gross

Margin

  

Gross

Profit

  

Gross

Margin

 
   $’000   %   $’000   % 
         
On-Highway   2,586    20.9    2,570    18.5 
Off-Highway   3,183    20.5    3,003    17.5 
Services (shipping charges)   28    100.0    39    100.0 
                     
Total   5,797    20.8    5,612    18.1 

 

Our total gross profit amounted to approximately $5.8 million and approximately $5.6 million for the six months ended June 30, 2024 and 2023, respectively. Our overall gross profit margins were approximately 20.8% and 18.1% for the six months ended June 30, 2024 and 2023, respectively. Our total gross profit increased slightly increased during the six months ended June 30, 2024 and 2023, which was generally due to procurement sourcing networks during the period.

 

Selling and distribution expenses

 

Our selling and distribution expenses mainly included promotion and marketing expenses and transportation expenses for inbound and outbound shipments. The following table sets forth the breakdown of our selling and distribution expenses for the six months ended June 30, 2024 and 2023:

 

   Six Months ended June 30, 
   2024   2023 
   $’000   $’000 
         
Promotion and marketing expenses   380    309 
Transportation expenses   304    388 
           
Total   684    697 

 

 
 

 

Our selling and distribution expenses remained stable at approximately $0.7 million for the six months ended June 30, 2024 and 2023, respectively.

 

Administrative expenses

 

The following table sets forth the breakdown of our administrative expenses for the six months ended June 30, 2024 and 2023:

 

   Six Months ended June 30, 
   2024   2023 
   $’000   %   $’000   % 
         
Staff costs   2,368    71.4    2,235    68.6 
Depreciation   224    6.8    126    3.9 
Property and related expenses   286    8.6    283    8.7 
Miscellaneous expenses   404    12.2    516    15.8 
Legal and professional fees   28    0.8    90    2.8 
Office supplies and upkeep expenses   4    0.2    7    0.2 
                     
Total   3,314    100.0    3,257    100.0 

 

Our administrative expenses remained the same at approximately $3.3 million for the six months ended June 30, 2024 and 2023, respectively.

 

Staff costs mainly represented the salaries, employee benefits and retirement benefit costs to our employees and directors’ remuneration. The staff costs of our Group had increased to approximately $2.4 million for the six months ended June 30, 2024 from approximately $2.2 million for the six months ended June 30, 2023.

 

Depreciation expense is charged on our property, plant and equipment, which included (i) leasehold buildings; (ii) right-of-use assets; (iii) tools and equipment; (iv) furniture and fittings; (v) computer equipment; and (vi) motor vehicles.

 

Property and related expenses mainly represented property tax and related expenses in Singapore.

 

Miscellaneous expenses were mainly comprised of insurance expenses, office supplies, legal and professional fees, charitable donations, and other miscellaneous expenses.

 

Other Income (Expense), Net

 

The following table sets forth the breakdown of our other income (expense) for the six months ended June 30, 2024 and 2023:

 

   Six Months ended June 30, 
   2024   2023 
   $’000   $’000 
         
Interest income   3    * 
Interest expense   (521)   (489)
Government grant   45    66 
Disposal of property and equipment   (3)   - 
Foreign exchange gain   372    266 
Other income   91    90 
           
Total   (13)   (67)

 

 
 

 

Interest expenses remained the same at approximately $0.5 million for the six months ended June 30, 2024 and 2023 from our bank loans and financing facilities.

 

We reported approximately $0.4 million of net foreign exchange gain for the six months ended June 30, 2024 and approximately $0.3 million of net foreign exchange gain for the six months ended June 30, 2023.

 

Income Tax Expenses

 

During the six months ended June 30, 2024 and 2023, our income tax expense was comprised of our current tax expense and deferred tax for the period.

 

For the six months ended June 30, 2024, our income tax expense was approximately $0.1 million and our effective tax rate was 6.2% due to decreased non-deductible expenses. Such increase in income tax expense was generally in line with the increase in our operating profit for the period.

 

For the six months ended June 30, 2023, our income tax expense was approximately $0.2 million and our effective tax rate was 15.1% due to decreased non-deductible expenses. Such increase in income tax expense was generally in line with the increase in our operating profit for the period.

 

Net Income

 

As a result of the foregoing, our net income amounted to approximately $1.7 million and $1.4 million for the six months ended June 30, 2024 and 2023, respectively.

 

Liquidity and Capital Resources

 

Our liquidity and working capital requirements primarily related to our operating expenses. Historically, we have met our working capital and other liquidity requirements primarily through a combination of cash generated from our operations and loans from banking facilities. Going forward, we expect to fund our working capital and other liquidity requirements from various sources, including but not limited to cash generated from our operations, loans from banking facilities, the net proceeds from this offering and other equity and debt financings as and when appropriate.

 

Cash flows

 

The following table summarizes our cash flows for the six months ended June 30, 2024 and 2023:

 

   Six Months ended June 30, 
   2024   2023 
   $’000   $’000 
         
Cash and cash equivalents as at beginning of the period   987    1,287 
           
Net cash provided by operating activities   1,162    311 
Net cash used in investing activity   (945)   (138)
Net cash provided by (used in) financing activities   140    (80)
Effect on exchange rate change on cash, cash equivalents and restricted cash   (210)   (56)
           
Net change in cash and cash equivalents   147    37 
           
Cash and cash equivalents as at end of the period   1,134    1,324 

 

 
 

 

Cash flows from operating activities

 

For the six months ended June 30, 2024, our net cash provided by operating activities was approximately $1.2 million, which primarily consisted of our net income of approximately $1.7 million, adding back (i) the non-cash depreciation of property, plant and equipment and right-of-use assets of approximately $0.2 million, and (ii) the decrease in inventories of approximately $1.1 million, (iii) the increase in tax provision of approximately $0.04 million, the increase in deposits, prepayments and other receivables of approximately $0.1 million and was partially offset (a) the increase in accounts receivable of approximately $1.8 million, (b) the decrease in accounts payables and accrued liabilities, and customer deposits of approximately $0.2 million.

 

For the six months ended June 30, 2023, our net cash provided by operating activities was approximately $0.3 million, which primarily consisted of our net income of approximately $1.4 million, adding back (i) the non-cash depreciation of property, plant and equipment and right-of-use assets of approximately $0.1 million, and (ii) the decrease in inventories of approximately $0.8 million, (iii) the increase in tax provision of approximately $0.1 million, and was partially offset (a) the increase in accounts receivable of approximately $1.1 million, (b) the decrease in accounts payables and accrued liabilities, and customer deposits of approximately $0.9 million, and (c) the amounts due to related parties of approximately $0.09 million.

 

Cash flows from investing activity

 

For the six months ended June 30, 2024, our net cash used in investing activities was approximately $0.9 million, which was primarily consisting of the purchase of property, plant and equipment of approximately $0.9 million.

 

For the six months ended June 30, 2023, our net cash used in investing activities was approximately $0.1 million, which was primarily consisting of the purchase of property, plant and equipment of approximately $0.1 million.

 

Cash flows from financing activities

 

Our cash flows used in financing activities primarily consists of interest paid, proceeds from loans, repayment of loans, payment for interest portion of lease liabilities and payment for capital portion of lease liabilities.

 

For the six months ended June 30, 2024, our net cash generated from financing activities of approximately $0.1 million, which mainly consisted of the proceeds from bank loans of approximately $1.6 million, the repayment of lease liabilities of approximately $0.2 million and the dividend payment of $1.3 million.

 

For the six months ended June 30, 2023, our net cash used in financing activities of approximately $0.008 million, which mainly consisted of the proceeds from bank loans of approximately $0.1 million, the repayment of lease liabilities of approximately $0.1 million.

 

 
 

 

About SAG Holdings Limited

 

SAG Holdings is a leading Singapore-based distributor dedicated to supplying high-quality spare parts across a wide range of industries.

 

On-Highway Division: We provide an extensive range of genuine OEM and aftermarket parts for passenger vehicles, trucks, and buses. Our offerings include parts from manufacturers’ brands, trusted third-party labels, and our in-house brands.

 

Off-Highway Division: Catering to industries like construction, marine, power generation, mining, and transportation, we offer specialized spare parts focusing on filtration systems, lubricants, batteries, and internal combustion engine components.

 

Our unwavering commitment to quality ensures customers experience maximum uptime, enhanced performance, and reduced total cost of ownership throughout the lifecycle of their machines. For more information, visit https://www.sag.sg.

 

Safe Harbor Statement

 

This press release contains forward-looking statements that reflect our current expectations and views of future events. Known and unknown risks, uncertainties and other factors, including those listed under “Risk Factors” in the registration statement on Form F-1 related to the Offering, may cause our actual results, performance or achievements to be materially different from those expressed or implied by the forward-looking statements. You can identify some of these forward-looking statements by words or phrases such as “may,” “will,” “expect,” “anticipate,” “aim,” “estimate,” “intend,” “plan,” “believe,” “is/are likely to,” “potential,” “continue” or other similar expressions. We have based these forward-looking statements largely on our current expectations and projections about future events that we believe may affect our financial condition, results of operations, business strategy and financial needs. These forward-looking statements involve various risks and uncertainties. Except as required by law, we undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events. We qualify all of our forward-looking statements by these cautionary statements.

 

Contact:

 

SAG Holdings Limited Contact:

Ivy Lee

Chief Financial Officer

Telephone +65 6383 7540

ivy.lee@soonaik.com