Reading time ( words)
For the financial year ended 31 December 2016, Singapore-based EMS firm Venture Corp. Ltd registered a 8.2% year-on-year increase in revenue to S$2.87 billion ($2.04 billion). For the three months ended 31 December 2016, group revenue increased by 23.1% year-on-year to S$854.6 million. Compared to the prior quarter, revenue for the reported quarter rose by 21.1%. New product/program introduction by customers and revenue growth from customers won in recent years contributed to the improvement in revenue for the reported quarter.
For the 12 months ended 31 December 2016, the group recorded profit before tax of S$215.9 million, an increase of 18.8% year-on-year. Including tax incentives granted to the subsidiaries of the group, an income tax expense of S$35.2 million was recorded for the year. Net profit (profit attributable to owners of the company) rose by 17.3% to S$180.7 million for the financial year ended 31 December 2016. The group recorded a net profit of S$54.1 million for the quarter ended 31 December 2016, an improvement of 20.6% year-on-year and 14% quarter-on-quarter. The improvement in profitability was driven by revenue growth, value creation, as well as improvements in operational excellence across the group’s facilities and its entire value-chain. The group registered net margin of 6.3% for the full year (FY 2015: 5.8%) and 6.3% for the reported quarter (4Q 2015: 6.5%). Diluted earnings per share for FY 2016 was 64.8 cents (FY 2015: 55.6 cents) and 19.3 cents (4Q 2015: 16.2 cents) for the quarter ended 31 December 2016.
Financial Position and Cashflow
During the year, Venture generated cash from operations of S$265.7 million (FY 2015: S$260.1 million). Compared to FY 2015, the group registered an increase in working capital position arising from higher balances in trade receivables and inventories. The increase in receivables was derived from the higher revenue recorded during the reported quarter. The increase in inventories is primarily to meet customers’ requirements and programs. As at the end of the financial year, the Group had cash and bank balances of S$499.7 million (FY 2015: S$459.3 million) and remained net cash positive at S$407.1 million (FY 2015: S$324.2 million).
As at 31 December 2016, equity attributable to owners of the company was S$1,960.1 million (FY 2015: S$1,893.2 million) and net asset value per share was S$7.03 (FY 2015: S$6.85).
The Board of Directors has recommended a final dividend of 50 cents per share on a one-tier tax-exempt basis for the financial year ended 31 December 2016. Subject to the approval of shareholders at the Annual General Meeting to be held on 27 April 2017, the proposed dividend will be paid on 25 May 2017.
The industry continues to undergo rapid change and transformation in a dynamic, highly competitive and globalized world. Amid all these, the group remains steadfast in strengthening its Clusters of Excellence and deepening its partnerships for value creation with leaders in technology domains of interests.
Venture will continue to augment its solid customer base, forging new complementary and collaborative alliances through its well-regarded engineering and manufacturing capabilities. Venture’s entrepreneurial spirit coupled with its set of core values will continue to provide unparalleled dedication and energy to render strong support to all its business partners and clients.
Venture will also continue to invest in growing its core groups of management, technical and professional talents to realize its mission to be a leading global provider of technology services, products and solutions.