Investor Relations

Inter Far East Energy Corporation Public Company Limited

Management Discussion & Analysis

Financial Analysis

The separate financial statement for the year 2013 has net profit amount 102.84 Million Baht, declined of 65.87 Million Baht or 39.04% comparing with last year. Caused by revenue from sales and service declined of 31.29 Million Baht or 4.76%, gross profit margin declined of 26.15 Million Baht or 7.95%, selling and administrative expenses declined of 10.30 Million Baht or 4.50% and Income from sale of business declined of 94.38 Million Baht.

The consolidated financial statement for the year 2013 has net profit amount 28.01 Million Baht less than the separate financial statement amount of 74.83 Million Baht caused by loss from subsidiary "Inter Far East Engineering Energy Co., Ltd." detail as followings:

  1. Consultants fee for investment in power generation from renewable energy amount 33.25 Million Baht.
  2. Administrative expenses amount 30.70 Million Baht.
  3. Financial cost amount 12.04 Million Baht.

Financial Status Analysis

Assets

Current Assets

Unit: Million Baht

Description Consolidated Separate Financial Statement
2013 2013 2012 2011
Amount % Amount % Amount % Amount %
Cash and cash equivalents
640.72
59%
359.57
24%
50.89
13%
175.91
33%
Current investments
 
 
 
 
 
 
5.00
1%
Trade accounts receivable
147.19
14%
144.74
10%
167.95
42%
145.22
27%
Other receivables
107.12
10%
91.41
6%
4.05
1%
 
 
Short - term loan to subsidiary
 
0%
727
48%
 
 
 
 
Inventories
100.85
9%
100.85
7%
96.17
24%
68.33
13%
Other current assets
0.20
0.02%
0.20
0.01%
0.16
0%
5.85
1%
Investments and loan to subsidiary held for sale
 
 
 
 
 
 
135.62
25%
Land held for sale
81.12
8%
81.12
5%
81.12
20%
 
 
Total current assets
1,077.20
100%
1,504.89
100%
400.34
100%
535.93
100%

As of the end of 31st December 2013, the company has total current assets of THB 1,504.89 million, increase from the previous year of THB 1,104.55 million or 275.90% with part of the decrease attributing to:

  • Cash and cash equivalents increase THB 308.68 million from increase in share capital amount THB 295.68 million.
  • Trade account receivable decrease THB 23.21 million.
  • Other receivable of the end of 31st December 2013 has total THB 91.41 million increase amount THB 87.36 million by deposits as advances amount THB 50 million, Prepaid expenses - increase share capital amount THB 18.57 million, Other receivable - Consultants fee for investment amount THB 15.51 million and other amount THB 3.28 million.
  • Short - term loan to Inter Far East Energy Co., Ltd. (subsidiary) amount THB 727 million. For acquisition of business "Green Energy Technology In (Thailand) Co., Ltd." amount THB 87.46 million activities Power generation and distribution, "Clean City Co., Ltd." amount THB 150 million activities community waste management., Administrative expense, consultants fee for investment and financial costs amount THB 72 million, short- term loan to subsidiary amount THB 95 million, deposit of investment and other amount THB 55 million.
  • Inventory increase amount THB 4.68 million for service customer.

Non - Current Assets

Unit : Million Baht

Description Consolidated Separate Financial Statement
2013 2013 2012 2011
Amount % Amount % Amount % Amount %
Trade accounts receivable - long-term portion
50.45
6%
50.45
12%
108.12
21%
95.00
18%
Deposits pledged as collateral
47.29
6%
36.99
9%
20.77
4%
26.04
5%
Other long-term investments
2.58
0.32%
2.58
1%
31.17
6%
30.24
6%
Investment in subsidiary
 
 
1.00
0.24%
 
 
 
 
Property,plant and equipment
452.40
56%
222.54
53%
249.37
48%
234.79
43%
Investment  properties
67.20
8%
64.13
15%
62.36
12%
145.08
27%
Intangible assets
2.63
0.33%
1.59
0%
2.13
0.41%
 
 
Goodwill
135.49
17%
 
 
 
 
 
 
Deferred income tax assets
31.00
4%
31
7%
31.21
6%
 
 
Other non-current assets
14.33
2%
10.81
3%
10.80
2%
11.07
2%
Total non-current assets
803.37
100%
421.09
100%
515.93
100%
542.22
100%

As of the end of 31st December 2013, the company has total non - current assets of THB 421.09 million, an decrease from the previous year of THB 94.84 million or 18.38% with part of the decrease attributing to:

  • Trade accounts receivable - long-term portion amount THB 50.45 million decrease from last year amount THB 57.67 million.
  • Property, plant and equipment decrease amount THB 26.83 million caused by decline from photocopiers for lease.

Acquisition of business has goodwill in consolidate financial statement is as follows:

Unit : Million Baht

Green Energy Technology In (Thailand) Co., Ltd.
Net assets acquired
49.29
Cash considerations for acquisition
(87.46)
Goodwill
38.17
Cash considerations for acquisition
87.46
Less Cash and cash equivalents of the acquired subsidiary
(3.61)
Cash considerations for acquisition, net
83.85

Unit : Million Baht

Clean City Co., Ltd.
Net assets acquired
52.69
Cash considerations for acquisition
(150.00)
Goodwill
97.31
Cash considerations for acquisition
150.00
Less Cash and cash equivalents of the acquired subsidiary
(0.18)
Cash considerations for acquisition, net
149.82

Liabilities

Unit : Million Baht

Description Consolidated Separate Financial Statement
2013 2013 2012 2011
Amount % Amount % Amount % Amount %
Short-term loans from financial institutions
180.57
53%
180.57
58%
104.28
47%
92.01
20%
Trade accounts payable
22.48
7%
22.48
7%
18.79
8%
12.25
3%
Other payables
41.67
12%
38.57
12%
40.68
18%
32.28
7%
Current portion of long-term loans from financial institutions
5.22
2%
 
 
 
 
106.86
23%
Short-term loans from other persons
2.10
1%
 
 
 
 
 
 
Advance received from sale ob business
 
 
 
 
 
 
100.00
22%
Advance received under the agreement to sale of the property
45.00
13%
45.00
14%
25.00
11%
 
 
Accrued income tax
 
 
 
 
9.21
4%
10.42
2%
Other current liabilities
4.63
1%
2.20
1%
4.82
2%
4.61
1%
Liabilities under finance lease agreements
15.58
5%
 
 
 
 
 
 
Retirement benefit obligations
23.03
7%
22.03
7%
21.05
9%
19.04
4%
Total liabilities
340.28
100%
310.85
100%
223.83
100%
462.35
100%

As of the end of 31st December 2013, the company has a total liabilities of THB 310.85 million, an increase from the previous year of THB 87.02 million or 38.88% with part of the decrease attributing to:

  • Short-term loans from financial institutions increase amount THB 76.29 million.

Advance received under the agreement to sale of the property

During the year 2013, the Company entered into the memorandum to the sale agreement of land to extend the transferring date. The counterparties agreed to extend the transferring date and the settlement date of the remaining amount of selling price to the date that the trespassers moved out from such land. In addition, the Company received the additional advance amounting to Baht 20 million during the year 2013. Resulting the Company received advance received under the agreement to sale of the property totally Baht 45 million, which presented in Current Liabilities.

Shareholders' Equity

Unit : Million Baht

Description Consolidated Separate Financial Statement
2013 2013 2012 2011
Amount % Amount % Amount % Amount %
Share capital
 
 
 
 
 
 
 
 
Share capital
 
 
 
 
 
 
 
 
   Authorised share capital
 
 
 
 
 
 
 
 
   1,376,300,733 ordinary shares (2012: 407,792,810 ordinary shares) of Baht 1 each
1,376.30
 
1,376.30
 
407.79
 
407.79
 
Issued and paid up share capital
 
 
 
 
 
 
 
 
   747,533,822 ordinary shares (2012: 407,792,810 ordinary shares) of Baht 1 each
747.53
40%
747.53
39%
407.79
45%
407.79
38%
Treasury stock
 
 
 
 
 
 
(6.59)
-1%
Premium on treasury stock
16.11
1%
16.11
1%
16.11
2%
 
0%
Premium on share capital
503.81
27%
503.81
26%
 
0%
 
0%
Retained earnings Appropriated for legal reserve & other reserve
39.72
2%
39.72
2%
34.59
4%
26.09
2%
Capital reserve for treasury stock
 
 
 
 
 
0%
6.59
1%
Unappropriated
182.16
10%
256.99
13%
186.87
20%
124.00
12%
Other components of equity
50.95
3%
50.95
3%
47.07
5%
57.91
5%
Total shareholders' equity
1,540.29
82%
1,615.12
84%
692.44
76%
615.80
57%
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
1,880.56
100%
1,925.97
100%
916.27
100%
1,078.15
100%

Increase of the registered share capital of the Company

At the Extraordinary General Shareholders Meeting No. 1/2013 on 28 August 2013, the shareholders had a resolution to approve the increase of the registered share capital of the Company from Baht 407,792,810 to Baht 1,376,300,733 by issuing 968,507,923 ordinary shares at a par value of Baht 1.00. The allocations of the increase of share capital are as follows:

  1. Allocate up to 203,896,405 newly issued ordinary shares to be offered to the Company's existing shareholders (Right Offering) at a subscription ratio of 2 existing shares to 1 newly issued ordinary share at the offering price of Baht 2.00 per share.

    In September 2013, the Company received the subscription of 197.38 million shares at Baht 2.00 per share totalling Baht 394.76 million, which recorded as share capital of Baht 197.38 million and premium on share capital of Baht 197.38 million. The Company registered the increased share capital with the Ministry of Commerce on 27 September 2013.
  2. Allocate up to 305,844,607 newly issued ordinary shares to be offered to the Private Placement. The offering price is Baht 3.25 per share.

    At the Board of Directors' Meeting held on 12 November 2013, the Board of Directors had the resolution to approve the private placement offering No. 1 of 142.36 million shares at offering price of Baht 3.25 per share, totalling Baht 462.66 million, which recorded as share capital of Baht 142.36 million and premium on share capital of Baht 306.42 million, (net of transaction costs amounting to Baht 13.88 million). The Company registered the increased share capital with the Ministry of Commerce on 3 December 2013.
  3. Allocate of newly issued shares for accommodating the exercise of warrants allocated for the existing shareholders in proportion to their shareholdings (IFEC-W1) in the amount up to 458,766,911 shares at the exercise price of Baht 1.00 per share to the existing shareholders and Private Placement. The subscription ratio is 2 existing shares to 1 unit of IFEC-W1 at the offering price Baht 0.00.

As at 31 December 2013, the authorised share capital is Baht 1,376.30 million divided into 1,376,300,733 ordinary shares of Baht 1 each (2012: Baht 407.79 million divided into 407,792,810 ordinary shares of Baht 1 each). The issued and paid-up share capital is Baht 747.53 million divided into 747,533,822 ordinary shares of Baht 1 each (2012: Baht 407.79 million divided into 407,792,810 ordinary shares of Baht 1 each).

Increase of the registered share capital

Month / Year Description Share Offering price Amount
Sep-13
Rights Offering
197.38
2.00
394.76
Nov-13
PP # 1
142.36
3.25
462.66
Total  
339.74
 
857.42
Cost  
 
 
13.88
Net  
 
 
843.54
Premium on share capital  
 
 
503.81