Tat Hong was pretty badly affected by the global economic slowdown for FY 2010, as can be seen from the recently released FY 2010 results in which revenue fell significantly, and where net profit attributable to shareholders plunged even more. Amid a difficult year though, there were some bright spots emerging for the Group; and hopefully for FY 2011, as the economy turns up, their business should also improve. One positive point is that they have managed to continue to pay out twice-yearly dividends, though of course these are greatly reduced as compared to prior years such as FY 2008 and FY 2009. Part of the reason is also because of the enlarged equity base due to the issuance of the RCPS (which are also entitled to all dividend declarations). My analysis will take on the usual 3 parts, with Part 1 covering the financial statements, Part 2 covering the various business divisions and margins for each division, and then part 3 touching on prospects and plans as well as covering a little on Tat Hong’s crane fleet in terms of crawler and tower cranes. Income Statement Review The Cash Flow analysis shows a positive operating cash inflow of S$29.3 million for FY 2010, and this was a significant improvement from the S$8.8 million cash inflow registered in FY 2009. The reason was that the increase in inventories was not as high as for FY 2009, which resulted in lower negative working capital changes being reflected. Read more...