AP Oil International (5AU) H1 2023 earnings summary

Executive summary

• H1 2023 revenue fell 33% YoY to S$20.75m; profit after tax declined 90% to S$107k, mainly reflecting lower revenue and gross profit.

• Market demand and selling-price pressure made conditions challenging; management expects the environment to persist through year-end and is pursuing new business opportunities.

Financial highlights

• Gross profit decreased 30% YoY to S$3.283m; profit before tax fell 91% to S$110k.

• Interest income rose to S$312k from S$60k, supported by higher bank fixed-deposit rates; finance costs fell 25% to S$71k after bank loans were fully repaid in October 2022.

• Adjusted for the S$63k Vietnam agreement surplus recorded in other gains, reported profit before tax was S$110k; the surplus was recognized on receipt of the refunded deposit and interest.

Outlook and guidance

• Challenging market conditions from lower demand and selling-price pressure are expected to persist through year-end.

• Management continues to seek new business opportunities, supported by a healthy balance sheet; no significant variance from the previously disclosed prospects statement was reported.