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Full Year Financial Statement And Dividend Announcement For The Period Ended 30/06/2004

PART I - INFORMATION REQUIRED FOR ANNOUNCEMENTS OF QUARTERLY (Q1, Q2 & Q3), HALF-YEAR AND FULL YEAR RESULTS

1(a) An income statement (for the group) together with a comparative statement for the corresponding period of the immediately preceding financial year.

Note:

Net profit for the year was stated after crediting/ (charging):-



1(b)(i) A balance sheet (for the issuer and group), together with a comparative statement as at the end of the immediately preceding financial year.




1(b)(ii) Aggregate amount of group's borrowings and debt securities.
Amount repayable in one year or less, or on demand

As at 30/06/04		As at 30/06/03
Secured	Unsecured	Secured	Unsecured
$'000 6,714	$'000 24,462	$'000 12,647	$'000 -



Amount repayable after one year



As at 30/06/04		As at 30/06/03
Secured	Unsecured	Secured	Unsecured
$'000 11,181	$'000 -	$'000 16,451	$'000 -



Details of any collateral
The Group's borrowings are secured by way of:
? Corporate guarantee from the Company and certain subsidiaries of the Group
? Legal mortgage of the Group's leasehold property
? Legal mortgages over certain vessels of subsidiaries
? Legal mortgages over certain plant and machineries of subsidiaries
? Assignment of certain charter income of subsidiaries
? Assignment of insurance of certain vessels of subsidiaries

On 18 December 2003, the Company offered 5,850,000 options to eligible employees and non-executive directors of the Group (collectively the "Grantees") under the ASL Employee Share Option Scheme (the "Scheme") to subscribe for and be allotted an aggregate of 5,850,000 ordinary shares of $0.10 each in the Company at an exercise price of $0.55 per share. The options are exercisable in accordance with the following vesting schedule:- ? Approximately 40% of options on or after 18 December 2004;
? Approximately 30% of options on or after 18 December 2005; and
? Approximately 30% of options on or after 18 December 2006


Acceptance of the offer of options closed on 17 January 2004 and a total of 5,500,000 options have been accepted by the Grantees and are exercisable as follows:- ? 2,200,000 options on or after 18 December 2004;
? 1,669,000 options on or after 18 December 2005; and
? 1,631,000 options on or after 18 December 2006.


Since the date of grant to the end of the financial year, 500,000 options were cancelled due to resignation of staff.

On 29 June 2004, the Company issued 20,080,000 new ordinary shares of $0.10 par value at an issue price of $0.50 each in the capital of the Company in consideration for the subscription of 10,040,000 new ordinary shares of $1.00 each at par in the capital of ASL Energy Pte Ltd pursuant to a sale and purchase agreement entered into amongst the Company, its jointly-controlled entity, ASL Energy Pte Ltd and others. The new ordinary shares issued by the Company were issued to Oriental Minerals Corporation as part of the purchase consideration for the acquisition of 50.2% equity interest in Pan Assets International Limited.

The figures have not been audited or reviewed by the auditors.

Not applicable.

The financial statements for the year ended 30 June 2003 were previously prepared in accordance with Singapore Statements of Accounting Standards ("SAS"). The financial statements for the year ended 30 June 2004 are prepared in accordance with Singapore Financial Reporting Standards ("FRS") including related Interpretations promulgated by the Council on Corporate Disclosure and Governance. With the adoption of FRS 17 in the current year, upfront lump sum payments made in respect of a long-term land lease are now accounted for as prepayments of operating leases.

The transition from SAS to FRS did not give rise to any adjustments to the opening balances of accumulated profits of the prior years and current period except for the reclassification of leasehold land and land use rights from property, plant and equipment to lease prepayments in accordance with FRS 17.

Note to item 6 (i):
The calculation of basic earnings per ordinary share of the Group is based on net profit for the year attributable to ordinary shareholders amounting to $9,944,390 (2003: $9,089,508) and the weighted average of 198,055,014 (2003:168,833,333) ordinary shares in issue during the year.

Note to item 6 (ii):
The calculation of fully diluted earnings per ordinary share of the Group is based on net profit for the year attributable to ordinary shareholders amounting to $9,944,390 (2003: $9,089,508) and the weighted average of 198,247,146 (2003:168,833,333) ordinary shares in issue during the year.

(a) current financial period reported on; and
(b) immediately preceding financial year.

Note:

The calculation of net asset value of the Group and of the Company is based on 218,080,000 (2003: 198,000,000) ordinary shares in issue as at end of the respective financial years.

(a) any significant factors that affected the turnover, costs, and earnings of the group for the current financial period reported on, including (where applicable) seasonal or cyclical factors; and

(b) any material factors that affected the cash flow, working capital, assets or liabilities of the group during the current financial period reported on.

REVIEW OF OPERATING PERFORMANCE FOR THE FULL YEAR ENDED 30 JUNE 2004

Revenue
Group revenue increased by 49.8% from $78.9 million in financial year ended 30 June 2003 ("FY2003") to $118.3 million for financial year ended 30 June 2004 ("FY2004"), mainly attributable to the increase in revenue from shipbuilding operations by 63.6% and shiprepairs and other marine related services by 95.4%.

Revenue from shipbuilding operations increased by $22.4 million from $35.1 million in FY2003 to $57.5 million in FY2004. The higher revenue was attributable to the recognition of revenue for the construction of 13 tugboats and 33 barges in FY2004, compared to 9 tugboats and 24 barges in FY2003. The average unit revenue recognized in FY2004 for tugboats increased by about 28% owing to the recognition of revenue for six Azimuth Stern Drive tugboats which generally have a higher contract value. Included in the 33 barges, proportionate revenue of approximately $3.8m on 13 barges built for its jointly-controlled entity, ASL Energy Pte Ltd ("ASL Energy") was recognized based on the 50% interest held by third party.

Revenue from shiprepairs and other marine related services for FY2004 was $27.5 million, an increase of $13.4 million compared to FY2003. The increase was mainly due to trading sales of vessels, cranes, winches and scrap metal of approximately $10.2 million in FY2004 as compared to $1.6 million in FY2003. In addition, there were more shiprepairs jobs undertaken during the financial year.

Revenue from shipchartering and rental operations increased by $3.5 million from $29.7 million in FY2003 to $33.2 million in FY2004. The higher revenue earned in FY2004 was mainly due to the coal shipping contract secured with its jointly-controlled entity, ASL Energy which commenced in September 2003. This contract is to support the $127 million contract that ASL Energy secured to transport coal in Indonesia waters for a period of 5 years.

Gross profit and gross profit margin
For FY2004, overall gross profit was $14.5 million, an increase of 3.7% compared to FY2003. Overall, gross profit margin decreased from 17.7% to 12.3% due to the higher proportion of shipbuilding revenue, which generally has the lowest margin and the lower gross profit margins from shiprepairs and shipchartering operations.

Gross profit from shipbuilding operations was $3.3 million for FY2004, an increase of $1.1 million compared to FY2003. The gross profit margin was 5.7% in FY2004 as compared to 6.2% in FY2003. The gross loss of $0.1 million noted in the first half of FY2004 was offset by the recognition of the more profitable projects in the second half of FY2004.

The gross profit margin from shiprepairs and other marine related services decreased from 39.9% in FY2003 to 23.5% in FY2004 despite the increase in gross profit from $5.6 million to $6.4 million. The lower margin was attributed to substantially higher proportion of trading sales of vessels, cranes, and equipments which generally yields a lower gross profit margin Further, the Group has taken on several shiprepair jobs involving ship-plate replacement, these jobs generally has lower gross profit margins but provide the Group with metal scraps which translates into other income for the Group when sold.

Gross profit from shipchartering and rental operations was $4.8 million, a decrease of $1.4 million as compared to $6.2 million in FY2003. Gross profit margin for shipchartering and rental operations declined from 20.8% in FY2003 to 14.3% in FY2004. The gross profit margin for the second half of FY2004 recovered to approximately 20.0%, mitigating the substantially lower gross profit margin of 8.6% for the first half of FY2004. The overall lower gross profit margin was mainly attributable to the lower utilisation of the Group's vessels, higher repair and improvement costs, higher third parties vessels charter costs and one-off mobilization costs incurred in mobilizing the fleet of vessels deployed for the coal transporting business in first half of FY2004.


Other income
Other income increased by $2.1 million from $2.4 million in FY2003 to $4.5 million in FY2004. Other income in FY2004 comprised mainly gain on disposal of plant and equipment of $1.3 million, miscellaneous income of $1.9 million, write back of allowance for doubtful trade receivables of $0.7 million and foreign exchange gain of $0.6 million. Miscellaneous income comprised mainly insurance compensation of $0.4 million, sale of metal scraps of $0.9 million, commission and management fee received from ASL Energy of $0.3 million.

Miscellaneous income increased by $1.1 million from $0.8 million in FY2003 mainly due to higher level of scrap sales and the fees charged to ASL Energy during the financial year under review. In addition, the Group achieved a foreign exchange gain of $0.6 million and a write back of net allowance for doubtful trade receivables of $0.7 million in FY2004 as compared to a foreign exchange loss of $0.4 million and a net provision made for doubtful trade receivables of $0.4 million in FY2003.

Administrative expenses
Administrative expenses were $5.3 million in FY2004 compared to $3.6 million in FY2003. The increase was mainly attributable to higher bank charges of $0.2 million, depreciation of $0.1 million, salaries and related costs of $1.1 million.

In line with the increased business activities, bank charges and depreciation increased due to higher utilization of trade finance facilities and additions of computers and peripherals as well as office renovation undertaken during FY2004. In addition, salaries and related costs increased owing to the increase in headcount and salaries costs.

Other operating expenses
Other operating expenses were $0.1 million in FY2004 compared to $1.1 million in FY2003. The other operating expenses in FY2004 mainly comprised impairment loss of $82,000. In FY2003, the other operating expenses mainly comprised foreign exchange loss of $0.4 million and net allowance for doubtful trade receivables of $0.4 million.

Finance costs
Finance costs were $1.3 million in FY2004 compared to $1.2 million in FY2003. The increase was due to higher utilization of trade finance facilities in line with the increase in business activities during the financial year under review. The finance costs were incurred substantially from term loan meant for our operational needs.

Profit before taxation
The Group achieved a profit before taxation of $12.5 million and $10.5 million for FY2004 and FY2003 respectively. The increase of $2.0 million or 18.7% was due to improvement in gross profit, higher other income, lower other operating expenses and share of profits in jointly-controlled entity.

Income tax expense
The Group's taxation charge in FY2004 was $2.5 million compared to $1.4 million in FY2003, an increase of $1.1 million or 77.0%. The Group's effective tax rate was 19.3% for FY2004 compared to 15.7% for FY2003 as there was higher non tax exempt shipping income profit that cannot be offset against the exempt income losses.

Operating cashflow
Net cash inflow from operating activities increased by $13.8 million from $3.0 million in FY2003 to $16.8 million in FY2004. This was mainly due to the higher amounts of advance payment received from certain customers in accordance with agreed milestones.


REVIEW OF FINANCIAL POSITIONS AS AT 30 JUNE 2004 AND 30 JUNE 2003

Non-current assets
Non-current assets comprised mainly property, plant and equipment which are stated at cost less depreciation and impairment loss, lease prepayments less amortisation and interest in a jointly-controlled entity. Property, plant and equipment increased by $9.2 million to $64.9 million as at 30 June 2004 from $55.7 million as at 30 June 2003. The increase was due to acquisition of vessels, plant and equipment of $21.4 million partially offset by disposal of vessels and plant and equipment of net book value totalling $5.7 million, impairment loss of $0.1 million and depreciation charge for the year of $6.4 million. In FY2004, the Group also invested $14.0 million in a jointly-controlled entity which was offset by unrealised gain from sale of vessels to the jointly-controlled entity.

Current assets
Current assets comprised inventories, construction work-in-progress, trade and other receivables, amount due from jointly-controlled entity as well as cash and cash equivalents.

Current assets increased by $24.1 million to $80.3 million as at 30 June 2004 from $56.2 million as at 30 June 2003. The increase was mainly due to the increase in inventories, trade and other receivables, amount due from jointly-controlled entity and cash and cash equivalents partially offset by decrease in construction work-in-progress. Inventories increased by $8.6 million mainly due to stock-up of steel plates for its existing projects on hand. Trade receivables and other receivables increased by $2.3 million and $1.7 million respectively. The increase in trade receivables was due to the overall increase in revenue. Debtors' turnover improved from 124 days in FY2003 to 100 days in FY2004 due to tighter credit control policy that resulted in improved collection from customers. Other receivables comprising deposits, prepayments and other debtors increased from $0.9 million to $2.6 million mainly due to downpayment for the purchase of machineries of $1.9 million. Amount due from jointly-controlled entity of $8.0 million mainly comprised billings for shipbuilding and shiprepairs projects as well as chartering of vessels to the jointly-controlled entity. The increase of cash and cash equivalents by $5.4 million to $15.3 million as at 30 June 2004 was due to improved collection from customers and higher amounts of advance payment received from certain customers in accordance with agreed milestones. As at 30 June 2004, there were higher contract value projects in construction work in progress as compared to FY2003. However, this was offset by higher advance billings made for these projects in accordance with the agreed milestone. As such, the net construction work in progress reflected a decrease of $1.8 million as compared to FY 2003.

Current liabilities
Current liabilities comprised bank overdraft, trade and other payables, progress billings in excess of construction work-in-progress, trust receipts, current portions of interest-bearing borrowings and finance lease liabilities and current tax payable.

Current liabilities increased by $33.4 million to $78.8 million as at 30 June 2004 from $45.4 million as at 30 June 2003. Trade and other payables, progress billings in excess of construction work-in-progress, trust receipts and current portions of interest-bearing borrowings increased by $3.9 million, $10.2 million, $16.0 million and $2.7 million respectively.

The increase in trade and other payables and trust receipts of $3.9 million and $16.0 million respectively was in line with the increased level of business activities. Progress billings in excess of construction work-in-progress increased due to advance billings made for tugboats in accordance with agreed milestones. The increase in current portions of interest-bearing borrowings by $2.7 million was due to commencement of repayments for term loans amounting to $10.5 million and addition of new term loans amounted to $6.2 million secured in FY2004 of which $2.1 million are repayable within the next 12 months partially offset by redemption of term loans in FY2004.

Non-current liabilities
Non-current liabilities comprised interest-bearing borrowings, finance lease liabilities and deferred tax liabilities. Non-current liabilities decreased by $4.8 million to $14.5 million as at 30 June 2004 from $19.3 million as at 30 June 2003. The decrease was mainly due to repayment of interest-bearing borrowings and finance lease liabilities, the redemption of loans partially offset by the additional drawdown during the financial year under review.

Share capital and reserves
Shareholder's equity, comprising share capital, share premium, capital reserve, exchange translation reserve and accumulated profits, increased by $18.0 million or 35.9% to $68.1 million as at 30 June 2004 from $50.1 million as at 30 June 2003. This was mainly due to the issuance of 20.1 million new ordinary shares of $0.10 each at a premium of $0.40 per share for net proceeds of $10.0 million, issuance of 49,500,000 warrants at an issue price of $0.025 per warrant for net proceeds of $0.7 million and net profits of $9.9 million earned by the Group during the year set off against the first and final tax exempt dividend of $2.8 million paid for FY2003.

Overall, there is no variance between the actual results for FY2004 and the prospect statement indicated in the announcements made on 18 September 2003 and 19 February 2004.

Industry Outlook
The local marine industry is expected to continue its positive industry outlook.

Together with the Group's strong order books, the Group expects to achieve revenue and profit growth for FY2005, barring the adverse impacts that may be caused by further increases in insurance premium and prices of steel and fuel.

Shipyard Operations
As at 30 June 2004, the Group has an outstanding order book for shipbuilding of approximately $158.9 million. Approximately 68% of these projects are expected to be recognised within the financial year ending 30 June 2005 ("FY2005"), with the balance to be substantially recognised in the financial year ending 30 June 2006 ("FY2006"). Overall, revenue and gross profit margin for shipbuilding, shiprepairs and other marine related services in FY2005 are expected to be higher as vessels with higher contract value and margins are expected to be delivered in FY2005 as compared to FY2004 and the additional revenue and margin contribution from shiprepairs and other marine related services in FY2005 with the commencement of operation of the 5,000 dwt floating dock facility in the second half of FY2005.

Further, to expand our shipbuilding and shiprepair capability to build and repair larger vessels, the Group is building a 240m x 60m x 11m graving dry dock in our Batam yard. The graving dry dock is expected to be completed and operational in the first half of FY2006.

Shipchartering Operations
As at 30 June 2004, the Group has an outstanding order book for shipchartering of approximately $36.7 million. In addition, a substantial portion of shipchartering revenue is short-term and ad-hoc in nature.

From 1 July 2003 to 30 June 2004, the Group has taken delivery of 3 tugboats and 12 barges worth an aggregate $11.9 million.

Further, the Group is in active discussion with various parties to form strategic alliances/joint ventures to take advantage of the booming shipchartering market in the region.

Jointly-controlled Entity Operations
ASL Energy has taken delivery of 12 tugboats and 17 barges worth an aggregate $22.2 million. In line with the expedited deliveries of the many vessels to ASL Energy, most of the third parties vessels charter have been retired and margin is expected to further improve.

On the Indonesian coal concession, the first shipment of coal from our Tabang coal concession is expected to leave Tabang by the end of the first half of FY2005. However, as production of coal would take some time to reach its optimum capacity, the guaranteed minimal operating cashflow for FY2005 of US$2.3 million would be the likely gross profit contribution expected for the coal mining and marketing business.

For the medium to longer term, the 65,000 dwt floating terminal is only expected to be completed and operational by the end of the first half of FY2006. This strategic investment serves to further strengthen our foothold in the Indonesian coal industry and thereby securing continuity to the operations.

Based on the generally more positive business environment and the Group's outstanding order books, the Group is optimistic that the revenue and profit after tax for the Group for FY2005 will be comparatively higher than that of FY2004.

(a) Current Financial Period Reported On
Any dividend recommended for the current financial period reported on? Yes



Name of Dividend	First & Final
Dividend Type	Cash
Dividend Amount per Share (in cents)	1.4 cents per ordinary share (one-tier tax)
Optional:- Dividend Rate (in %)
Par value of shares	$0.10
Tax Rate	0%



(b) Corresponding Period of the Immediately Preceding Financial Year
Any dividend declared for the corresponding period of the immediately preceding financial year? Yes



Name of Dividend	First & Final
Dividend Type	Cash
Dividend Amount per Share (in cents)	1.4 cents per ordinary share (one-tier tax)
Optional:- Dividend Rate (in %)
Par value of shares	$0.10
Tax Rate	0%



(c) Date payable

To be advised at a later date.


(d) Books closure date
To be advised at a later date.

Not applicable.

The Directors believe it could be inaccurate to analyse the segment assets by geographical segment because certain vessels cannot be meaningfully allocated to the different geographical areas. For the charter services, charterers of the Group's vessels have the discretion to operate within a wide trading area and are not constrained by a specific sea route.

Please refer to item 8.

Total Annual Dividend (Refer to Para 16 of Appendix 7.2 for the required details)

	Latest Full Year ($'000)	Previous Full Year ($'000)
Ordinary	3,053	2,772
Preference	0	0
Total:	3,053	2,772