6-K
ASIA PACIFIC WIRE & CABLE CORP LTD (APWC)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 6-K
REPORT OFFOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of: November 2021
Commission File Number: 1-14542
ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED
(Translation of registrant’s name into English)
15/Fl. B,No. 77, Sec. 2, Dunhua South Road, Taipei, 106, Taiwan, Republic of China
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F ☒ Form 40-F ☐
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ☐
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ☐
This Report on Form 6-K consists of (i) the Registrant’s press release issued on November 16, 2021, a copy of which is attached hereto as Exhibit 99.1 and is incorporated herein by reference; and (ii) the Registrant’s Unaudited Condensed Consolidated Interim Financial Statements for the six-month periods ended June 30, 2021 and 2020 and as of June 30, 2021 and December 31, 2020, respectively, which are attached hereto as Exhibit 99.2.
EXHIBIT INDEX
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| ASIA PACIFIC WIRE & CABLECORPORATION LIMITED | ||
|---|---|---|
| (Registrant) | ||
| Date: November 19, 2021 | By: | /s/ Ivan Hsia |
| Ivan Hsia | ||
| Chief Financial Officer |
EX-99.1
Exhibit 99.1
Asia Pacific Wire & Cable Corporation Ltd. Reports Second Quarter 2021 Financial Results
TAIPEI, Taiwan, November 16, 2021 (GLOBE NEWSWIRE) — Asia Pacific Wire & Cable Corporation Limited (NASDAQ: APWC) (“APWC” or the “Company”), a leading manufacturer of wire and cable products for the telecommunications and electric-power industries in the Asia-Pacific region, today announced the Company’s financial results for the six months ended June 30, 2021. Unless otherwise indicated, all data are reported in U.S. Dollars at the exchange rate prevailing on the date of the event or result reported.
First Six Months 2021 Financial Results (Ended June 30, 2021), and 2020 comparative results
| First 6 Months 2021 | First 6 Months 2020 | CHANGE | |||||||
|---|---|---|---|---|---|---|---|---|---|
| Revenues | $ | 225.3 million | $ | 127.6 million | 76.5 | % | |||
| Operating Profit | $ | 5.0 million | $ | 0.3 million | 1780.3 | % | |||
| Net (Loss) | $ | (0.1) million | $ | (1.2) million | 90.2 | % | |||
| EPS^(1)^ | $ | (0.01 | ) | $ | (0.09 | ) | 88.9 | % | |
| ^(1)^ | The calculation of the earnings per share is based on 13,819,669 and 13,819,669 basic and diluted weighted<br>average common shares issued and outstanding for the six months ended June 30, 2021 and 2020, respectively. | ||||||||
| --- | --- |
First Six Months2021 Results
Revenues for the six months ended June 30, 2021, were $225.3 million, an increase of 76.5% from $127.6 million for the six months ended June 30, 2020. The increase was primarily attributable to revenue increases in the Company’s Thailand, North Asia, and Rest of World (“ROW”) regions. Net revenue in the Company’s Thailand region increased by 58.0%, primarily attributable to increases in copper prices and due to lower sales in the first half of 2020 because of the pandemic. Revenues in the Company’s North Asia region increased by 83.8%, primarily attributable to increases in copper prices and due to lower sales in the first half of 2020 because of the pandemic. Revenues in the Company’s Rest of World (“ROW”) region increased by 102.8%, primarily due to deferral of orders in Singapore (which had a lockdown from March to June 2020) and stricter border control in Australia. The Company’s North Asia region includes China and Hong Kong; the Thailand region consists of operations and sales within Thailand; the ROW region includes Singapore, Australia and the other markets where APWC has operations or sales outside of the Thailand region and North Asia region.
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Operating profit (loss) for the six months ended June 30, 2021 increased to $5.0 million from $0.3 million for the six months ended June 30, 2020. Operating profit margin increased from 0.2% in 2020 to 2.2% in 2021. In the Thailand region, operating profit (loss) margin increased slightly year over year from 3.7% to 3.9%. Revenue increased by 58%, but operating profit remained low because the Thailand region provided a $2.2 million allowance for diminution in the value of inventories in 2021. In the North Asia region, operating profit (loss) margin decreased slightly from 3.0% in 2020 to 2.7% for the same period in 2021, primarily attributable to copper price fluctuations. The ROW region’s operating profit (loss) margin increased from (4.1)% in 2020 to 1.3% in 2021, primarily attributable to decreased competition due to COVID-19.
Selling, general and administrative expenses for the six months ended June 30, 2021 were $13.0 million, compared to $11.8 million reported for the six months ended June 30, 2020. Net income (loss) attributable to APWC shareholders was $(0.1) million for the first six months of 2021, compared to $(1.2) million for the same period in 2020. The increase in net income was primarily due to an increase in gross profit. The weighted average number of shares issued and outstanding was 13.82 million for the six months ended June 30, 2021 and 2020.
Financial Condition
APWC reported $39.0 million in cash and cash equivalents as of June 30, 2021, compared to cash and cash equivalents of $52.2 million as of December 31, 2020.
Current assets totaled $306.6 million as of June 30, 2021, compared to $263.7 million as of December 31, 2020. Working capital was $168.9 million as of June 30, 2021, as compared to $174.3 million as of June 30, 2020. Short term bank loans were $56.2 million at June 30, 2021, an increase from $10.1 million at the end of 2020. The Company had $3.5 million in long-term debt outstanding at June 30, 2021, compared to $3.7 million in long-term debt as of December 31, 2020. Shareholder’s equity attributable to APWC was $152.6 million as of June 30, 2021, compared to $157.9 million as of December 31, 2020.
APWC reported $46.3 million in cash used in operations during the six months ended June 30, 2021, compared to cash generated from operations of $10.8 million in the corresponding period in 2020. The increase in cash used in operations in 2021 was primarily attributable to recovery of economy, which led to an increase in purchases of materials and copper prices. The Company reported $1.9 million in cash outflows from investing activities during the six months ended June 30, 2021, compared to $15.7 million in cash outflows in the same period of 2020. The decrease in cash used for investing activities was attributable primarily to decrease in purchase of investment properties and short-term bank deposits in 2021. APWC reported $38.7 million in cash inflows from financing activities during the first six months of 2021, compared to $5.6 million in cash inflows from financing activities in the same period of 2020. The increase in cash inflows in 2021 was primarily attributable to an increase in borrowings.
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We encourage shareholders to visit the Company’s website for further information (www.apwcc.com). Information on the Company’s website or any other website does not constitute a portion of this release.
About Asia Pacific Wire & CableCorporation Limited
Asia Pacific Wire & Cable Corporation is a holding company incorporated in Bermuda with principal executive offices in Taiwan that operates our business through operating subsidiaries. Through our subsidiaries, our Company is principally engaged in the manufacture and distribution (in descending order of sales) of enameled wire, power cable, and telecommunications products in Thailand, Singapore, Australia, the People’s Republic of China (the “PRC”), Hong Kong and certain other markets in the Asia Pacific region. Our Company also engages in the distribution of certain wire and cable products manufactured by our controlling shareholder, Pacific Electric Wire & Cable Company (a Taiwanese company), and third parties. Our Company also provides project engineering services in the supply, delivery and installation of power cable. Our Company’s major customers include government organizations, electric contracting firms, electrical dealers, and wire and cable factories. In 2020, the Thailand market accounted for approximately 46% of sales, the Rest of World (“ROW”) market (which refers to Australia, Singapore and certain other markets in the Asia Pacific region) accounted for approximately 31% of sales, and the North Asia market (which refers to PRC and Hong Kong) accounted for approximately 23% of sales.
Safe Harbor Statement
This release contains certain “forward-looking statements” relating to the Company, its business, and its subsidiary companies. These forward-looking statements are often identified by the use of forward-looking terminology such as “believes”, “anticipates”, “expects”, “estimates”, “intends”, “plans” or similar expressions. Such forward looking statements involve known and unknown risks and uncertainties that may cause actual results to be materially different from those described herein as believed, anticipated, expected, estimated, intended or planned. Investors should not place undue reliance on
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these forward-looking statements, which speak only as of the date of this press release. The Company’s actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in the Company’s periodic reports that are filed with the Securities and Exchange Commission and available on its website (www.sec.gov). All forward-looking statements attributable to the Company or to persons acting on its behalf are expressly qualified in their entirety by these factors other than as required under the securities laws. The Company does not assume a duty to update these forward-looking statements.
Contact:
Investor Relations Contact:
Skyline Corporate Communications Group, LLC
Lisa Gray, Senior Account Manager
One Rockefeller Plaza, 11th Floor
New York, NY 10020
Office: (646) 893-5835
Email: lisa@skylineccg.com
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ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED AND SUBSIDIARIES
CONSOLIDATED INCOME STATEMENTS
(Amounts in thousands of U.S. Dollars, except share data)
| For the six monthsended June 30, | ||||||
|---|---|---|---|---|---|---|
| 2021(Unaudited) | 2020(Unaudited) | |||||
| Revenue | $ | 225,282 | $ | 127,614 | ||
| Cost of sales | (207,414 | ) | (115,544 | ) | ||
| Gross profit | 17,868 | 12,070 | ||||
| Other operating income | 238 | 262 | ||||
| Selling, general and administrative expenses | (13,025 | ) | (11,844 | ) | ||
| Other operating expenses | (117 | ) | (224 | ) | ||
| Operating profit | 4,964 | 264 | ||||
| Finance costs | (583 | ) | (370 | ) | ||
| Finance income | 76 | 178 | ||||
| Share of loss of associates | (1 | ) | (1 | ) | ||
| Exchange loss | (2,776 | ) | 145 | |||
| Other income | 731 | 584 | ||||
| Other expense | (1 | ) | — | |||
| Profit before tax | 2,410 | 800 | ||||
| Income tax expense | (1,738 | ) | (1,134 | ) | ||
| Profit/(loss) for the period | $ | 672 | $ | (334 | ) | |
| Attributable to: | ||||||
| Equity holders of the parent | $ | (116 | ) | $ | (1,180 | ) |
| Non-controlling interests | $ | 788 | $ | 846 | ||
| Basic and diluted loss per share | $ | (0.01 | ) | $ | (0.09 | ) |
| Basic and diluted weighted average common shares outstanding | 13,819,669 | 13,819,669 |
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ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Amounts in thousands of U.S. Dollars, except share data)
| For the six months | ||||||
|---|---|---|---|---|---|---|
| ended June 30, | ||||||
| 2021 | 2020 | |||||
| (Unaudited) | (Unaudited) | |||||
| Profit/(loss) for the period | $ | 672 | $ | (334 | ) | |
| Other comprehensive loss | ||||||
| Other comprehensive loss to be reclassified to profit or loss in subsequent periods: | ||||||
| Exchange differences on translation of foreign operations, net of tax of nil | (10,072 | ) | (6,919 | ) | ||
| (10,072 | ) | (6,919 | ) | |||
| Other comprehensive income/(loss) not to be reclassified to profit or loss in subsequent<br>periods: | ||||||
| Changes in the fair value of equity instruments measured at fair value through other comprehensive<br>income/(loss) | 645 | (1,069 | ) | |||
| Income tax effect | (129 | ) | 214 | |||
| 516 | (855 | ) | ||||
| Re-measuring income on defined benefit plans | 244 | 134 | ||||
| Income tax effect | (49 | ) | (26 | ) | ||
| 195 | 108 | |||||
| Other comprehensive loss for the period, net of tax | (9,361 | ) | (7,666 | ) | ||
| Total comprehensive loss for the period, net of tax | (8,689 | ) | (8,000 | ) | ||
| Attributable to: | ||||||
| Equity holders of the parent | (5,219 | ) | (6,096 | ) | ||
| Non-controlling interests | (3,470 | ) | (1,904 | ) | ||
| $ | (8,689 | ) | $ | (8,000 | ) |
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ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands of U.S. Dollars, except share data)
| As ofJune 30, 2021(Unaudited) | As ofDecember 31, 2020(Audited) | |||
|---|---|---|---|---|
| Assets | ||||
| Current assets | ||||
| Cash and cash equivalents | $ | 39,014 | $ | 52,237 |
| Financial assets at fair value through profit or loss | 441 | — | ||
| Trade receivables | 98,012 | 82,071 | ||
| Other receivables | 3,472 | 6,192 | ||
| Contract assets | 9,286 | 10,245 | ||
| Due from related parties | 11,983 | 10,982 | ||
| Inventories | 133,297 | 96,371 | ||
| Prepayments | 5,759 | 4,055 | ||
| Other current assets | 5,357 | 1,546 | ||
| 306,621 | 263,699 | |||
| Non-current assets | ||||
| Financial assets at fair value through other comprehensive income | 2,866 | 2,271 | ||
| Property, plant and equipment | 53,331 | 54,700 | ||
| Right of use assets | 3,023 | 3,248 | ||
| Investment properties | 6,108 | 6,378 | ||
| Intangible assets | 148 | 180 | ||
| Investments in associates | 870 | 930 | ||
| Deferred tax assets | 3,961 | 3,889 | ||
| Other non-current assets | 3,564 | 2,824 | ||
| 73,871 | 74,420 | |||
| Total assets | $ | 380,492 | $ | 338,119 |
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ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands of U.S. Dollars, except share data)
| As ofJune 30, 2021(Unaudited) | As ofDecember 31, 2020(Audited) | |||||
|---|---|---|---|---|---|---|
| Liabilities | ||||||
| Current liabilities | ||||||
| Interest-bearing loans and borrowings | $ | 56,193 | $ | 10,131 | ||
| Trade and other payables | 38,077 | 27,370 | ||||
| Due to related parties | 6,541 | 10,620 | ||||
| Accruals | 20,397 | 21,361 | ||||
| Current tax liabilities | 3,205 | 3,567 | ||||
| Employee benefit liabilities | 1,918 | 1,950 | ||||
| Lease liabilities | 449 | 551 | ||||
| Other current liabilities | 10,907 | 7,826 | ||||
| 137,687 | 83,376 | |||||
| Non-current liabilities | ||||||
| Interest-bearing loans and borrowings | 3,493 | 3,650 | ||||
| Employee benefit liabilities | 9,580 | 10,027 | ||||
| Lease liabilities | 1,675 | 1,783 | ||||
| Deferred tax liabilities | 4,686 | 4,408 | ||||
| 19,434 | 19,868 | |||||
| Total liabilities | 157,121 | 103,244 | ||||
| Equity | ||||||
| Issued capital | 138 | 138 | ||||
| Additional paid-in capital | 110,416 | 110,416 | ||||
| Treasury shares | (38 | ) | (38 | ) | ||
| Retained earnings | 52,716 | 52,832 | ||||
| Other components of equity | (10,591 | ) | (5,488 | ) | ||
| Equity attributable to equity holders of the parent | 152,641 | 157,860 | ||||
| Non-controlling interests | 70,730 | 77,015 | ||||
| Total equity | $ | 223,371 | $ | 234,875 | ||
| Total liabilities and equity | $ | 380,492 | $ | 338,119 |
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ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands of U.S. Dollars)
| For the six months ended June 30, | ||||||
|---|---|---|---|---|---|---|
| 2021 | 2020 | |||||
| (Unaudited) | (Unaudited) | |||||
| Operating activities: | ||||||
| Profit before tax | 2,410 | 800 | ||||
| Adjustments to reconcile profit before tax to net cash provided by operating activities: | ||||||
| Depreciation | 2,659 | 2,577 | ||||
| Impairment of property, plant and equipment | 28 | — | ||||
| Amortization of intangible assets | 27 | 29 | ||||
| Gain on disposal of property, plant and equipment | (114 | ) | (43 | ) | ||
| Adjustment for gain on fair value of derivatives | (458 | ) | (25 | ) | ||
| Finance income | (76 | ) | (178 | ) | ||
| Finance costs | 583 | 370 | ||||
| Share of loss of associates | 1 | 1 | ||||
| Impairment for trade receivables | 89 | 223 | ||||
| Reversal of impairment for trade receivables for related parties | (4 | ) | (7 | ) | ||
| Reversal of impairment for other receivable | — | (111 | ) | |||
| Impairment of inventories | 2,584 | 982 | ||||
| Unrealized foreign exchange difference, net | 2,037 | 111 | ||||
| Changes in operating assets and liabilities | ||||||
| Trade and other receivable, net | (19,022 | ) | 22,042 | |||
| Contract assets | 791 | 2,886 | ||||
| Inventories | (44,828 | ) | (22,667 | ) | ||
| Prepayment and other current assets | (5,858 | ) | (3,427 | ) | ||
| Amounts due to/from related parties | 731 | 633 | ||||
| Other non-current assets | (283 | ) | (80 | ) | ||
| Trade and other payables, accruals, other current liabilities and | ||||||
| other non-current liabilities | 15,016 | 7,215 | ||||
| Net cash flows (used in) provided by operating activities | **** | (43,687 | ) | **** | 11,331 | **** |
| Interest received | 84 | 1,032 | ||||
| Interest paid | (485 | ) | (296 | ) | ||
| Income tax paid | (2,168 | ) | (1,220 | ) | ||
| Net cash (used in) provided by operating activities | **** | (46,256 | ) | **** | 10,847 | **** |
| Investing activities: | ||||||
| Purchases of property, plant and equipment | (4,226 | ) | (3,892 | ) | ||
| Purchases of intangible assets | (1 | ) | (55 | ) | ||
| Purchases of investment properties | — | (4,865 | ) | |||
| Purchases of long-term bank deposits | (39 | ) | (604 | ) | ||
| Purchases of short-term bank deposits | (1,281 | ) | (6,388 | ) | ||
| Proceeds from disposal of property, plant and equipment | 133 | 64 | ||||
| Proceeds from maturities of short-term bank deposits | 3,509 | — | ||||
| Net cash used in investing activities | **** | (1,905 | ) | **** | (15,740 | ) |
| Financing activities: | ||||||
| Dividend paid to non-controlling shareholders of<br>subsidiaries | (2,815 | ) | (1,207 | ) | ||
| Repayments of borrowings | (2,817 | ) | (2,297 | ) | ||
| Repayments of borrowings—related parties | (6,000 | ) | — | |||
| Proceeds from borrowings | 50,650 | 9,340 | ||||
| Principal elements of lease payments | (316 | ) | (274 | ) | ||
| Net cash provided by financing activities | **** | 38,702 | **** | **** | 5,562 | **** |
| Effect of exchange rate | (3,764 | ) | (1,421 | ) | ||
| Net decrease in cash and cash equivalents | (13,223 | ) | (752 | ) | ||
| Cash and cash equivalents at beginning of year | 52,237 | 53,673 | ||||
| Cash and cash equivalents at end of period | **** | 39,014 | **** | **** | 52,921 | **** |
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EX-99.2
Exhibit 99.2
ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED
Unaudited Condensed Consolidated Interim Financial Statements
As of June 30, 2021 and December 31, 2020
For the Six-Month Periods Ended June 30, 2021 and 2020
1
INDEX TO UNAUDITED CONDENSED INTERIM FINANCIAL STATEMENTS
CONTENTS
| Unaudited Condensed Consolidated interim income statements | 3 |
|---|---|
| Unaudited Condensed Consolidated interim statements of comprehensive income | 4 |
| Unaudited Condensed Consolidated interim balance sheets | 5 |
| Unaudited Condensed Consolidated interim statements of changes in equity | 6 |
| Unaudited Condensed Consolidated interim statements of cash flows | 7 |
| Notes to the unaudited condensed consolidated interim financial statements | 8 |
| 1. | Principal activities and corporate information |
| --- | --- |
| 2. | Basis of preparation |
| --- | --- |
| 2.1 | Basis of preparation |
| --- | --- |
| 2.2 | New standards, interpretations and amendments adopted by the Company |
| --- | --- |
| 3. | Significant changes in the current reporting period |
| --- | --- |
| 4. | Segment information |
| --- | --- |
| 5. | Income tax |
| --- | --- |
| 6. | Financial assets and financial liabilities |
| --- | --- |
| 7. | Inventories |
| --- | --- |
| 8. | Property, plant and equipment |
| --- | --- |
| 9. | Other current liabilities |
| --- | --- |
| 10. | Related party transactions |
| --- | --- |
| 11. | Subsequent event |
| --- | --- |
| 12. | Approval of the financial statements |
| --- | --- |
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ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED
UNAUDITED CONDENSED CONSOLIDATED INTERIM INCOME STATEMENTS
For the six-months ended June 30, 2021 and 2020
| 2021 | 2020 | ||||||
|---|---|---|---|---|---|---|---|
| Note | US’000 | US’000 | |||||
| Revenue | 4 | (e) | |||||
| Cost of sales | 7 | ) | ) | ||||
| Gross profit | |||||||
| Other operating income | |||||||
| Selling, general and administrative expenses | ) | ) | |||||
| Other operating expenses | ) | ) | |||||
| Operating profit | |||||||
| Finance costs | ) | ) | |||||
| Finance income | |||||||
| Share of loss of associates | ) | ) | |||||
| Exchange (loss)/gain | ) | ||||||
| Other income | |||||||
| Other expense | ) | ||||||
| Profit before tax | |||||||
| Income tax expense | 5 | ) | ) | ||||
| Profit/ (loss) for the period | ) | ||||||
| Attributable to: | |||||||
| Equity holders of the parent | ) | ) | |||||
| Non-controlling interests | |||||||
| ) | |||||||
| Loss per share | |||||||
| Basic and diluted loss for the period attributable to equity holders of the parent | ) | ) |
All values are in US Dollars.
The accompanying notes are an integral part of these unaudited consolidated financial statements.
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ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED
UNAUDITED CONDENSED CONSOLIDATED INTERIM STATEMENTS OF COMPREHENSIVE INCOME
For the six-months ended June 30, 2021 and 2020
| 2021 | 2020 | |||||
|---|---|---|---|---|---|---|
| US’000 | US’000 | |||||
| Profit/ (loss) for the period | **** | **** | ||||
| Other comprehensive income/(loss) | ||||||
| Other comprehensive income /(loss) to be reclassified to profit or loss in subsequent<br>periods: | ||||||
| Exchange differences on translation of foreign operations, net of tax of 0 | ) | ) | ||||
| Other comprehensive income/(loss) not to be reclassified to profit or loss in subsequent<br>periods: | ||||||
| Changes in the fair value of equity instruments measured at fair value through other comprehensive<br>income/(loss) | 6 | (d) | ) | |||
| Income tax effect | 5 | ) | ||||
| Other comprehensive income from equity instruments measured at fair value, net of tax | ) | |||||
| Re-measuring income on defined benefit plans | ||||||
| Income tax effect | 5 | ) | ) | |||
| Defined benefit pension plan, net of tax | ||||||
| Other comprehensive loss for the period, net of tax | **** | **** | ||||
| Total comprehensive loss for the period, net of tax | **** | **** | ||||
| Attributable to: | ||||||
| Equity holders of the parent | ||||||
| Non-controlling interests | ||||||
| **** | **** |
All values are in US Dollars.
The accompanying notes are an integral part of these unaudited consolidated financial statements.
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ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED
UNAUDITED CONDENSED CONSOLIDATED INTERIM BALANCE SHEETS
| As of | |||||||
|---|---|---|---|---|---|---|---|
| 30-Jun-21 | 31-Dec-20 | ||||||
| Note | US’000 | US’000 | |||||
| Assets | |||||||
| Current assets | |||||||
| Cash and cash equivalents | |||||||
| Financial assets at fair value through profit or loss | 6 | ||||||
| Trade receivables | |||||||
| Other receivables | |||||||
| Contract assets | |||||||
| Due from related parties | 10 | ||||||
| Inventories | 7 | ||||||
| Prepayments | |||||||
| Other current assets | |||||||
| Non-current assets | |||||||
| Financial assets at fair value through other comprehensive income | 6 | ||||||
| Property, plant and equipment | 8 | ||||||
| Right of use assets | |||||||
| Investment properties | |||||||
| Intangible assets | |||||||
| Investments in associates | |||||||
| Deferred tax assets | |||||||
| Other non-current assets | |||||||
| Total assets | **** | **** | |||||
| Liabilities | |||||||
| Current liabilities | |||||||
| Interest-bearing loans and borrowings | 6 | (b) | |||||
| Trade and other payables | |||||||
| Due to related parties | 10 | ||||||
| Accruals | |||||||
| Current tax liabilities | |||||||
| Employee benefit liabilities | |||||||
| Lease liabilities | 6 | (d) | |||||
| Other current liabilities | 9 | ||||||
| Non-current liabilities | |||||||
| Interest-bearing loans and borrowings | 6 | (b) | |||||
| Employee benefit liabilities | |||||||
| Lease liabilities | 6 | (d) | |||||
| Deferred tax liabilities | |||||||
| Total liabilities | **** | **** | |||||
| Equity | |||||||
| Issued capital | |||||||
| Additional paid-in capital | |||||||
| Treasury shares | ) | ) | |||||
| Retained earnings | |||||||
| Other components of equity | ) | ) | |||||
| Equity attributable to equity holders of the parent | **** | **** | |||||
| Non-controlling interests | |||||||
| Total equity | **** | **** | |||||
| Total liabilities and equity | **** | **** |
All values are in US Dollars.
The accompanying notes are an integral part of these unaudited consolidated financial statements.
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ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED
UNAUDITED CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN EQUITY
| Attributable to the equity holders of the parent | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Issuedcapital | Additionalpaid-incapital | Treasuryshares | Retainedearnings | Remeasurementofdefinedbenefit plans | Financialassets atFVOCIreserve | Foreigncurrencytranslationreserve | Total | Non-controllinginterests | Totalequity | ||
| Note | US’000 | US’000 | US’000 | US’000 | US’000 | US’000 | US’000 | US’000 | US’000 | US’000 | |
| Balance at January 1, 2020 | |||||||||||
| Profit (loss) for the half-year | |||||||||||
| Other comprehensive income/(loss) | |||||||||||
| Total comprehensive income/(loss) | |||||||||||
| Dividend paid | |||||||||||
| Balance at June 30, 2020 | |||||||||||
| Balance at January 1, 2021 | |||||||||||
| Profit (loss) for the half-year | |||||||||||
| Other comprehensive income/(loss) | |||||||||||
| Total comprehensive income/(loss) | |||||||||||
| Dividends paid | |||||||||||
| Balance at June 30, 2021 |
All values are in US Dollars.
The accompanying notes are an integral part of these unaudited consolidated financial statements.
6
ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED
UNAUDITED CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS
For the six-months ended June 30, 2021 and 2020
| 2021 | 2020 | |||||
|---|---|---|---|---|---|---|
| Note | US’000 | US’000 | ||||
| Operating activities: | ||||||
| Profit before tax | ||||||
| Adjustments to reconcile profit before tax to net cash provided by operating activities: | ||||||
| Depreciation | 8 | |||||
| Impairment of property, plant and equipment | 8 | |||||
| Amortization of intangible assets | ||||||
| Gain on disposal of property, plant and equipment | ) | ) | ||||
| Adjustment for gain on fair value of derivatives | ) | ) | ||||
| Finance income | ) | ) | ||||
| Finance costs | ||||||
| Share of loss of associates | ||||||
| Impairment for trade receivables | ||||||
| Reversal of impairment for trade receivables for related parties | ) | ) | ||||
| Reversal of impairment for other receivable | ) | |||||
| Impairment of inventories | 7 | |||||
| Unrealized foreign exchange difference, net | ||||||
| Changes in operating assets and liabilities | ||||||
| Trade and other receivable, net | ) | |||||
| Contract assets | ||||||
| Inventories | ) | ) | ||||
| Prepayment and other current assets | ) | ) | ||||
| Amounts due to/from related parties | ||||||
| Other non-current assets | ) | ) | ||||
| Trade and other payables, accruals, other current liabilities and | ||||||
| other non-current liabilities | ||||||
| Net cash flows (used in) provided by operating activities | ) | **** | ||||
| Interest received | ||||||
| Interest paid | ) | ) | ||||
| Income tax paid | ) | ) | ||||
| Net cash (used in) provided by operating activities | ) | **** | ||||
| Investing activities: | ||||||
| Purchases of property, plant and equipment | ) | ) | ||||
| Purchases of intangible assets | ) | ) | ||||
| Purchases of investment properties | ) | |||||
| Purchases of long-term bank deposits | ) | ) | ||||
| Purchases of short-term bank deposits | ) | ) | ||||
| Proceeds from disposal of property, plant and equipment | ||||||
| Proceeds from maturities of short-term bank deposits | ||||||
| Net cash used in investing activities | ) | ) | ||||
| Financing activities: | ||||||
| Dividend paid to non-controlling shareholders of<br>subsidiaries | ) | ) | ||||
| Repayments of borrowings | ) | ) | ||||
| Repayments of borrowings - related parties | ) | |||||
| Proceeds from borrowings | ||||||
| Principal elements of lease payments | ) | ) | ||||
| Net cash provided by financing activities | **** | **** | ||||
| Effect of exchange rate | ) | ) | ||||
| Net decrease in cash and cash equivalents | ) | ) | ||||
| Cash and cash equivalents at beginning of year | ||||||
| Cash and cash equivalents at end of period | **** | **** |
All values are in US Dollars.
The accompanying notes are an integral part of these unaudited consolidated financial statements.
7
ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
| 1. | PRINCIPAL ACTIVITIES AND CORPORATE INFORMATION |
|---|
Asia Pacific Wire & Cable Corporation Limited (“APWC”), which is a subsidiary of Pacific Electric Wire & Cable Co., Ltd. (“PEWC”), a Taiwanese company, was incorporated as an exempted company in Bermuda on September 19, 1996 under the Companies Act 1981 of Bermuda (as amended) for the purpose of acting as a holding company. APWC is principally engaged in owning operating companies engaged in the power cable, telecommunication cable, enameled wire and electronic cable industry. APWC’s registered office is located at Victoria Place, 5th Floor, 31 Victoria Street, Hamilton HM 10, Bermuda. APWC’s executive business office is presently located in Taipei, Taiwan.
APWC’s operating subsidiaries (the “Operating Subsidiaries”) are engaged in the manufacturing and distribution of telecommunications, power cable and enameled wire products in Singapore, Thailand, Australia, the People’s Republic of China (“PRC”) and other markets in the Asia Pacific region. Major customers of the Operating Subsidiaries include government organizations, electric contracting firms, electrical dealers, and wire and cable factories. The Operating Subsidiaries also engage in the distribution of certain wire and cable products manufactured by PEWC and third parties. The Operating Subsidiaries also provides project engineering services in supply, delivery and installation (the “SDI”) of power cable to certain of its customers.
APWC is listed and traded its common shares on the Nasdaq Capital Market.
| 2. | BASIS OF PREPARATION |
|---|---|
| 2.1 | The unaudited condensed consolidated interim financial statements as of June 30, 2021 and for the<br>six months ended June 30, 2021 and 2020 are prepared in accordance with Accounting Standard IAS 34 Interim Financial Reporting. |
| --- | --- |
The unaudited condensed consolidated interim financial statements are presented in U.S. dollars and all values are rounded to the nearest thousand (US$’000), except when otherwise indicated.
The unaudited condensed consolidated interim financial statements do not include all the information and disclosures required in the annual financial statements, and should be read in conjunction with the annual consolidated financial statements of APWC and its subsidiaries (collectively as the “Company”) for the year ended December 31, 2020. Selected explanatory notes are included to explain events and transactions that are significant to an understanding of the changes in the Company’s financial position and performance since the last annual financial statements.
| 2.2 | New standards, interpretations and amendments adopted by the Company |
|---|
The accounting policies adopted in the preparation of the unaudited condensed consolidated interim financial statements are consistent with those followed in the preparation of the Company’s annual consolidated financial statements for the year ended December 31, 2020, except for the adoption of new standards effective as of January 1, 2021. The Company has not early adopted any standards, interpretation or amendments that has been issued but is not yet effective.
Several amendments apply for the first time in 2021, but have an immaterial impact on the unaudited condensed consolidated interim financial statements of the Company.
Interest rate benchmark reform Phase 2 – Amendments to IFRS 9, IAS 37, IFRS 7, IFRS 4 and IFRS16
The amendments provide practical reliefs related to modifications of financial instruments and lease contracts or hedging relationships triggered by a replacement of benchmark interest rate in a contract with a new alternative benchmark rate. The amendments had no impact on the unaudited condensed consolidated interim financial statements of the Company. The Company intends to use the practical expedients in future periods if they become applicable.
8
ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
| 2.2 | New standards, interpretations and amendments adopted by the Company (continued) |
|---|
Several amendments are effective for annual reporting periods beginning on or after January 1, 2022, but none of these are expected to have a material impact on its consolidated financial statements.
Reference to the conceptual framework: Amendments to IFRS 3
The amendments are intended to update IFRS 3 refers to the Conceptual Framework issued in March 2018 instead of the 1989 Framework, and add an exception for the recognition of liabilities and contingent liabilities within the scope of IAS 37 Provision, Contingent Liabilities and Contingent Assets and Interpretation 21 Levies. The amendments also confirm that contingent assets should not be recognized at the acquisition date. The Company does not expect the amendments to have an impact on its consolidated financial statements.
Property, plant and equipment: proceeds before intended use – Amendments to IAS 16
On May 14, 2020, the IASB issued Property, Plant and Equipment: Proceeds before Intended Use, which prohibits entities deducting from the cost of an item of property, plant and equipment, any proceeds from selling items produced while bringing that asset to the location and condition necessary for it to be capable of operating in the manner intended by management. Instead, an entity recognizes the proceeds from selling such items, and the costs of producing those items, in profit or loss.
The Company does not expect the amendments to have an impact on its consolidated financial statements.
Onerous contracts – Amendments to IAS 37
On May 14, 2020, the IASB issued amendments to IAS 37 to specify which costs an entity needs to include when assessing whether a contract is onerous or loss-making. The amendments apply a “directly related cost approach”. The costs that related directly to a contract to provide goods or services include both incremental costs and allocation of costs directly related to contract activities. General and administrative costs do not relate directly to a contract and excluded unless they are explicitly chargeable to the counterparty under the contract. The amendments apply to contracts for which the entity has not yet fulfilled all its obligations at the beginning of the annual reporting period in which the entity first applies the amendments. Comparatives are not restated. The Company will apply these amendments to contacts for which the Company has not yet fulfilled all its obligations at the beginning of the annual reporting period in which it first applies the amendments.
The Company does not expect the amendments to have a material impact on its consolidated financial statements**.**
9
ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
| 3. | SIGNIFICANT CHANGES IN THE CURRENT REPORTING PERIOD |
|---|
Our manufacturing and production have been affected by the outbreak of COVID-19. COVID-19 has affected and disrupted our operations and the operations of our suppliers, customers, and other business partners, including as a result of travel restrictions, business shutdowns, and other COVID-19 containment measures. A slowdown in economic activity as a result of COVID-19 has also resulted in, and could continue to result in, a reduction in demand for our products.
Our China production facilities had been operating back to normal production levels in the first half of 2021. Although our production in China has recovered, there can be no assurance that it will not decrease again as a result of COVID-19.
With the introduction of Stabilization Phase of Transition to COVID-19 Resilience by Singapore government and updates to border measures which effective from 26 October 2021 onwards we are in the opinion that these soften measures in response to COVID-19 could have a positive impact on our business, financial condition or results of operations. However, we cannot predict whether the Singapore government will again institute measures requiring businesses to close or reduce on-site staff, or if it will institute other measures in response to COVID-19 that could have a material adverse effect on our business, financial condition or results of operations. COVID-19 has had, and is expected to continue to have, a negative impact on our business in Singapore. In addition, COVID-19 has delayed the fulfillment of contracts with our customers, causing negative impacts on our cash flow and liquidity. If we are not able to expand or extend lines of credit from banks, we may negotiate business terms with our suppliers to meet our liquidity needs in Singapore, which could cause an increase in financing costs.
The business operation in Australia has experienced certain degree of impact from global pandemic of COVID-19. Two of the biggest states in the country has locked down a few times during the year, undoubtedly there are interruption in business operation in those areas leading to reduction in sales volume and business confidence. Fortunately, our factory operation in Brisbane, Queensland has been classified as essential business which allows us to continue to operate during the lockdown stage. The business in Queensland has not been adversely affected due to border closure between states, shortage of supply of imported cables, and demand from existing building infrastructure and projects. However, ongoing increase in freight costs, continue rising of material costs due to shortage and shipping issue, would certainly add pressure to our cashflow and business operation and pose challenges to the already competitive market environment.
The impact of COVID-19 is constantly changing. Our operations in Thailand could be materially and adversely affected if an outbreak recurs in these regions. Although we are monitoring the situation, the extent to which COVID-19 impacts our business will depend on future developments, which are uncertain and unpredictable in nature.
We are facing increased operational challenges as we take measures to support and protect employee health and safety as a result of COVID-19. For example, in order to protect the employees from COVID-19, the Company has taken measures to protect its employees, including temperature checks before entering the workplace, mandatory mask-wearing, social distancing, and work from home. We have also implemented staggered work hours to lower the risk that our employees might get infected on public transportations if they commute during peak hours. In particular, our remote work arrangements, coupled with stay-at-home orders and quarantines, pose challenges to our employees and our IT systems, and the extension of remote work arrangements could increase operational risk, including cyber security and IT systems management risks, and impair our ability to manage our business. The increased operational challenges could have a material and adverse effect on our business, financial conditions, and results of operations. In addition, Copper prices have risen by more than 20% from the end of 2020 to the end of October 2021, which has the effect of the value of our inventory.
10
ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
COVID-19 has also adversely impacted the recoverability of certain of our assets. COVID-19 is expected to continue to impact the recoverability of the Company’s assets and lead to further impairment charges in the future.
| 4. | SEGMENT INFORMATION |
|---|---|
| 4(a) | Basis of segments |
| --- | --- |
Each segment engages in business activities which generate revenues and incur expenses. Based upon the information provided to the Company’s chief operating decision maker (“CODM”) to make decisions on resource allocation and operating performance evaluation, the Company has determined that it has three reportable segments.
The Company organizes its business segments along reporting lines and has three operating segments, consisting of the North Asia region, the Thailand region and the Rest of the World (“ROW”) region. The Company considers the economic characteristics similarity in determining the reportable segments.
As the three operating segments exceed the quantitative thresholds, they are also reportable segments. The accounting policies for segment information, including transactions entered between segments are generally the same as those described in the summary of significant accounting policies.
Inter-segment revenues are eliminated upon consolidation and reflected in the “adjustments and eliminations” column. All other adjustments and eliminations are part of detailed reconciliations presented further below.
| 4(b) | Information about reportable segments | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Period ended June 30, 2021 | North Asia | Thailand | ROW | Totalsegments | Corporateexpenseadjustmentsandeliminations | Consolidated | ||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| US’000 | US’000 | US’000 | US’000 | US’000 | US’000 | |||||||
| Revenues | ||||||||||||
| External customers | ||||||||||||
| Inter-segment | ) | |||||||||||
| Segment operating profit (loss) | ) | |||||||||||
| Depreciation and amortization (Included depreciation from right of use assets) | ) | ) | ) | ) | ) | ) | ||||||
| Depreciation from right of use assets | ) | ) | ) | ) | ) | |||||||
| Impairment of property, plant and equipment | ) | ) | ) | |||||||||
| Interest income | ||||||||||||
| Interest expense | ) | ) | ) | ) | ) | ) | ||||||
| Income tax (expense)/benefit | ) | ) | ) | ) | ) | |||||||
| Other disclosures | ||||||||||||
| Capital expenditure |
All values are in US Dollars.
11
ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
| 4. | SEGMENT INFORMATION (continued) | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 4(b) | Information about reportable segments (continued) | |||||||||||
| --- | --- | |||||||||||
| Period ended June 30, 2020 | North Asia | Thailand | ROW | Totalsegments | Corporateexpenseadjustmentsandeliminations | Consolidated | ||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| US’000 | US’000 | US’000 | US’000 | US’000 | US’000 | |||||||
| Revenues | ||||||||||||
| External customers | ||||||||||||
| Inter-segment | ||||||||||||
| Segment operating profit (loss) | ) | ) | ||||||||||
| Depreciation and amortization(Included depreciation from right of use assets) | ) | ) | ) | ) | ) | ) | ||||||
| Depreciation from right of use assets | ) | ) | ) | ) | ) | |||||||
| Impairment of property, plant and equipment | ||||||||||||
| Interest income | ||||||||||||
| Interest expense | ) | ) | ) | ) | ) | |||||||
| Income tax (expense)/benefit | ) | ) | ) | ) | ) | ) | ||||||
| Other disclosures | ||||||||||||
| Capital expenditure |
All values are in US Dollars.
| Adjustments | and eliminations |
|---|
Corporate expenses, gain on disposal of investment, and share of gain (loss) of associates are not allocated to individual segments as the underlying instruments are managed on a group basis.
12
ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
| 4. | SEGMENT INFORMATION (continued) | |||
|---|---|---|---|---|
| 4(c) | Reconciliation of segment operating profit (loss) | |||
| --- | --- | |||
| For six-monthsended June 30 | ||||
| --- | --- | --- | --- | --- |
| 2021 | 2020 | |||
| US’000 | US’000 | |||
| Segment operating profit | ||||
| Corporate expense | ) | ) | ||
| Other operating income | ||||
| Other operating expenses | ) | ) | ||
| Operating profit | ||||
| Finance costs | ) | ) | ||
| Finance income | ||||
| Share of loss of associates | ) | ) | ||
| Exchange (loss) / gain | ) | |||
| Other income | ||||
| Other expense | ) | |||
| Profit before tax |
All values are in US Dollars.
| 4(d) | Segment assets and liabilities | |||||
|---|---|---|---|---|---|---|
| NorthAsia | Thailand | ROW | Totalsegments | Corporateadjustmentsandeliminations | Consolidated | |
| --- | --- | --- | --- | --- | --- | --- |
| US’000 | US’000 | US’000 | US’000 | US’000 | US’000 | |
| As of June 30, 2021 | ||||||
| Total assets | ||||||
| Total liabilities | ||||||
| As of December 31, 2020 | ||||||
| Total assets | ||||||
| Total liabilities |
All values are in US Dollars.
| Reconciliation | of assets: | |
|---|---|---|
| As of June 30, | As of December 31, | |
| --- | --- | --- |
| 2021 | 2020 | |
| US’000 | US’000 | |
| Segment operating assets | ||
| Corporate and other assets | ||
| Investment in associates | ||
| Deferred tax assets | ||
| Total assets |
All values are in US Dollars.
13
ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
| 4. | SEGMENT INFORMATION (continued) |
|---|---|
| 4(d) | Segment assets and liabilities (continued) |
| --- | --- |
Reconciliation of liabilities:
| As of June 30, 2021 | As of December 31,2020 | |
|---|---|---|
| US’000 | US’000 | |
| Segment operating liabilities | ||
| Corporate liabilities | ||
| Deferred tax liabilities | ||
| Total liabilities |
All values are in US Dollars.
| 4(e) | Disaggregated revenues and geographical information |
|---|
(i)Revenue from external customers is summarized as the following major categories:
.
| Period ended of June 30, 2021 | NorthAsia | Thailand | ROW | Totalsegments | Corporateexpenseadjustmentsandeliminations | Consolidated |
|---|---|---|---|---|---|---|
| US’000 | US’000 | US’000 | US’000 | US’000 | US’000 | |
| Revenue from external customers | ||||||
| Power | ||||||
| Enamel | ||||||
| Others* | ||||||
| Timing of revenue recognition | ||||||
| At a point in time | ||||||
| Over time | ||||||
All values are in US Dollars.
| * | include revenues from SDI service contracts (which amounted to US$11.6 million in 2021, and sale of other<br>wires and cables products |
|---|
14
ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
| 4. | SEGMENT INFORMATION (continued) |
|---|---|
| 4(e) | Disaggregated revenues and geographical information (continued) |
| --- | --- |
(i)Revenue from external customers is summarized as the following major categories (continued):
| Period ended June 30, 2020 | NorthAsia | Thailand | ROW | Totalsegments | Corporateexpenseadjustmentsandeliminations | Consolidated |
|---|---|---|---|---|---|---|
| US’000 | US’000 | US’000 | US’000 | US’000 | US’000 | |
| Revenue from external customers | ||||||
| Power | ||||||
| Enamel | ||||||
| Others* | ||||||
| Timing of revenue recognition | ||||||
| At a point in time | ||||||
| Over time | ||||||
All values are in US Dollars.
| * | include revenues from SDI service contracts (which amounted to US$0.04 million in 2020 fabrication service<br>contracts, and sale of other wires and cables products.) |
|---|
15
ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
| 4. | SEGMENT INFORMATION (continued) |
|---|---|
| 4(e) | Disaggregated revenues and geographical information (continued) |
| --- | --- |
(ii) Revenue from external customers is attributed to individual countries based on the customer’s country of Domicile and is summarized as follows:
| For six-months ended June 30 | ||
|---|---|---|
| 2021 | 2020 | |
| US’000 | US’000 | |
| Revenues from external customers | ||
| Thailand | ||
| Singapore | ||
| Australia | ||
| China | ||
| India | ||
| Southeast Asia | ||
| Northeast Asia | ||
All values are in US Dollars.
Countries in the Southeast Asia region include Cambodia, Vietnam, Indonesia, Brunei, Laos, Malaysia and Myanmar; countries in the Northeast Asia region include Japan and South Korea.
| 4(f) | Non-current assets information |
|---|
The total non-current assets other than financial instruments and deferred tax assets broken down by the country of domicile are summarized as follow:
| As of June 30, | As of December 31, | |
|---|---|---|
| 2021 | 2020 | |
| US’000 | US’000 | |
| Non-current assets by area: | ||
| Thailand | ||
| Singapore | ||
| China | ||
| Australia | ||
| Others | ||
| Total non-current assets |
All values are in US Dollars.
16
ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
| 5. | INCOME TAX |
|---|
The Company calculated the period income tax expense using the tax rate that would be applicable to the expected total annual earnings. The major components of income tax expenses in the unaudited condensed consolidated interim financial statements are:
| For the six monthsended June 30 | ||||
|---|---|---|---|---|
| 2021 | 2020 | |||
| US’000 | US’000 | |||
| Consolidated income statements | ||||
| Current income tax: | ||||
| Current income tax charge | ||||
| Total current income tax | ||||
| Deferred tax expenses/(benefits): | ||||
| Relating to origination and reversal of temporary differences | ) | ) | ||
| Total deferred tax expenses/(benefits) | ) | ) | ||
| Income tax expense reported in the income statement | **** | **** | ||
| Consolidated statements of comprehensive income | ||||
| Deferred tax related to items recognized in other comprehensive income during the year: | ||||
| Change in the fair value of equity instrument measured at fair value through other comprehensive<br>income | ||||
| Recognized during the year | ) | |||
| Net income (loss) on actuarial gains and losses | ||||
| Recognized during the year | ||||
| Income tax benefits charged to other comprehensive (loss) income | **** | ) |
All values are in US Dollars.
17
ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
| 6. | FINANCIAL ASSETS AND FINANCIAL LIABILITIES | |
|---|---|---|
| 6(a) | Other financial assets and liabilities | |
| --- | --- | |
| As of June 30, | As of December 31, | |
| --- | --- | --- |
| 2021 | 2020 | |
| US’000 | US’000 | |
| Financial assets at fair value through other comprehensive income | ||
| Equity instrument (Note 6(d)) | ||
| Financial assets at fair value through profit or loss | ||
| Foreign exchange forward contracts (Note 6(c)) | ||
All values are in US Dollars.
| (i) | Financial assets and liabilities at fair value through profit or loss |
|---|
Financial assets and liabilities at fair value through profit or loss reflect the changes in fair value of those foreign exchange forward contracts that are not designated in hedge relationships, but are intended to reduce the level of foreign currency risk for expected sales and purchase transactions.
| (ii) | Financial assets at fair value through other comprehensive income - unquoted equity instrument |
|---|
On January 1, 2018, the date of initial application of IFRS 9, the Company elected to reclassify its unquoted equity instrument in Thai Metal Processing Co., Ltd (“TMP”), which is engaged in the fabrication of copper rods, from financial assets – available-for-sale to financial assets at fair value through other comprehensive income due to the investment being hold as a long-term strategic investment and not expected to be sold in the short to medium term.
18
ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
| 6. | FINANCIAL ASSETS AND FINANCIAL LIABILITIES (continued) |
|---|
6(b) Interest-bearing loans and borrowings
Under the line of credit arrangements for debt with the Company’s banks, the Company may borrow up to approximately $264,150 and $264,162 as of June 30, 2021 and December 31, 2020, respectively, on such terms as the Company and the banks may mutually agree upon. These arrangements do not have termination dates but are reviewed annually for renewal. As of June 30, 2021 and December 31, 2020, the unused portion of the credit lines was approximately $144,932 and $200,340, respectively, which included unused letters of credit amounting to $61,484 and $95,034, respectively.
Letters of credit are issued by the Company in the ordinary course of business through major financial institutions as required by certain vendor contracts. As of June 30, 2021 and December 31, 2020, the Company had open letters of credit amounting to $56,843 and $18,077, respectively. Liabilities relating to the opened letters of credit are included in current liabilities.
Interest bearing loans and borrowings are including current portion $56,193 and $10,131 as of June 30, 2021 and December 31, 2020, respectively.
| As of June 30, 2021 | As of December 31, 2020 | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Interestrate | Maturity Local currency | Interestrate | Maturity | Local<br><br><br>currency | ||||||||||
| % | ‘000 | US’000 | % | ‘000 | US’000 | |||||||||
| Interest-bearing loans and borrowings | ||||||||||||||
| Bank loans | 3.07 | Mar.2045 | AUD$ | 4,797 | 3.07 | Mar. 2045 | AUD$ | 4,883 | ||||||
| Bank loans | 3.85 ~ 5.0 | Jul. 2022 | RMB$ | 48,000 | 4.5 ~4.9 | Jun. 2021 | RMB$ | 17,800 | ||||||
| Trust receipt | 0.68 ~ 3.0 | Jun. 2022 | THB$ | 1,412,297 | 0.9 ~ 1.0 | Mar. 2021 | THB$ | 74,176 | ||||||
| Trust receipt | 1.99 | Oct. 2021 | SGD$ | 5,812 | 2.32 | Apr. 2021 | SGD$ | 6,332 | ||||||
| Total |
All values are in US Dollars.
19
ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
| 6. | FINANCIAL ASSETS AND FINANCIAL LIABILITIES (continued) |
|---|
6(c) Hedging activities and derivatives
(i) Commodity price risk **** ****
The Company purchases copper on an ongoing basis as its operating activities require a continuous supply of copper for manufacturing products. To reduce the exposures to copper shortage, the Company enters into purchase contracts with commitment of monthly minimum purchase at market prices for selected operating units. The majority of these transactions take the form of contracts that are entered into and continue to be held for the purpose of receipt or delivery of the copper based on the Company’s expected purchase, sale or usage requirements. Such purchase commitment contracts are not deemed financial instruments or derivatives. To date, these contract positions have not had a material effect on the Company’s financial position, results of operations, and cash flow.
(ii) Foreign currency risk
The Company enters into foreign exchange forward contracts with the intention to reduce the foreign exchange risk of expected sales and purchase transactions. These contracts are entered into the periods consistent with foreign currency exposure of the underlying transaction, generally from one to 12 months. These contracts are not designated in hedge relationships, and are measured at fair value through profit or loss.
As of June 30, 2021 and December 31, 2020, the Company had outstanding forward contracts with notional amounts of $12 million and $0 million, respectively. The outstanding forward contracts at June 30, 2021 and December 31, 2020 mature between August 10 and December 15, 2021, respectively.
The forward contract balance varies with the expected foreign currency transactions and changes in foreign exchange rate.
| As of June 30, 2021 | As ofDecember 31,2020 | |||
|---|---|---|---|---|
| Assets | Liabilities | Assets | Liabilities | |
| US’000 | US’000 | US’000 | US’000 | |
| Foreign currency forward contracts | ||||
| Fair value |
All values are in US Dollars.
20
ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
| 6. | FINANCIAL ASSETS AND FINANCIAL LIABILITIES (continued) |
|---|
6(d) Fair values
Set out below is a comparison of the carrying amounts and fair value of the Company’s financial instruments that are carried in the financial statements:
| Carrying amount | Fair value | |||
|---|---|---|---|---|
| As of June 30, | As of December 31, | As of June 30, | As of December 31, | |
| 2021 | 2020 | 2021 | 2020 | |
| US’000 | US’000 | US’000 | US’000 | |
| Financial assets-current | ||||
| Financial assets at amortized cost | ||||
| Cash and cash equivalents | ||||
| Financial assets at fair value through profit or loss | ||||
| Trade receivables | ||||
| Other receivables | ||||
| Due from related parties | ||||
| Financialassets-non-current | ||||
| Financial assets at fair value through other comprehensive income | ||||
| Financial assets at amortized cost | ||||
| Long-term bank deposits* | ||||
| Total | ||||
| Financial liabilities-current | ||||
| Liabilities at amortized cost | ||||
| Interest-bearing loans and borrowings | ||||
| Trade and other payables | ||||
| Due to related parties | ||||
| Lease liabilities | ||||
| Financialliabilities-non-current | ||||
| Liabilities at amortized cost | ||||
| Interest-bearing loans and borrowings | ||||
| Lease liabilities | ||||
| Total |
All values are in US Dollars.
(i) Methods and assumptions used to estimate fair value
The fair value of the financial assets and liabilities is included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. The following methods and assumptions were used to estimate the fair values:
| • | Cash and cash equivalents, trade receivables, other receivables, due from related parties, trade and other<br>payables, due to related parties, and financial lease liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments. |
|---|
21
ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
| 6. | FINANCIAL ASSETS AND FINANCIAL LIABILITIES (continued) |
|---|
(i) Methods and assumptions used to estimate fair value (continued)
| • | Fixed-rate and variable-rate receivables are evaluated by the Company based on parameters such as interest<br>rates, specific country risk factors, individual creditworthiness of the customer and the risk characteristics of the financed project. Based on this evaluation, allowances were provided to account for the expected losses of these receivables. As of<br>June 30, 2021 and December 31, 2020, the carrying amounts of such receivables, net of allowances, were not materially different from their calculated fair values. |
|---|---|
| • | Fixed rate long-term bank deposits and fixed rate and variable-rate borrowings are evaluated using discounted<br>cash flows and the market rates or current rates for deposits of similar remaining maturities. |
| --- | --- |
| • | Fair value of financial liabilities at fair value through profit or loss—derivatives is derived<br>from inputs other than quoted prices that are observable for the asset or liability. |
| --- | --- |
| • | Fair value of interest-bearing borrowings and loans are determined by using discounted cash flow method with<br>discount rate that reflects the issuer’s borrowing rate as of the end of the reporting period. The non-performance risk as of June 30, 2021 was assessed to be insignificant. |
| --- | --- |
(ii) Description of significant unobservable inputs to valuation
| Valuationtechnique | Significantunobservableinputs | Liquiditydiscount<br>(2021and2020) | Sensitivity of the input to<br>fair value | ||||||
|---|---|---|---|---|---|---|---|---|---|
| As ofJune 30,<br><br><br>2021 | |||||||||
| Financial asset | |||||||||
| Unquoted equity instrument | Market<br>Approach<br>Method | Liquidity<br>Discount | 30% | 5%decreasein thediscountwouldincreasein fairvalue by204 | 5%<br>decrease<br>in the<br>discount<br>would<br>increase<br>in fair<br>value by<br>$162 |
All values are in US Dollars.
The Company estimates the fair value of investment in equity instrument by using the market approach (market comparatives approach). The key in this method is the selection of quoted comparable companies and accommodate adjustments to bring the accounts of different companies into a broadly consistent framework for analysis. Then, select appropriate Indicators of Value. The followings should be taken into account:
| • | Enterprise Value (EV) versus Market Capitalization; |
|---|---|
| • | Earnings-based: EBITDA +/or EBIT versus Net Earnings +/or Net Cash Flow |
| --- | --- |
| • | Balance Sheet based: Net Total Assets versus Shareholders Funds |
| --- | --- |
Discount for the lack of liquidity to reflect the lesser liquidity of this equity instrument compared with those of its comparable public company peers. The Company assessed the discount for the lack of liquidity to be 30 percent on the basis of relevant studies applicable in the region and industry as well as on the specific facts and circumstances of the equity instrument. The equity instrument’s finance performance is characterized by stable, consistent growth and profitability. The Company believes the liquidity discount of 30% would be appropriate.
22
ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
| 6. | FINANCIAL ASSETS AND FINANCIAL LIABILITIES (continued) |
|---|
(ii) Description of significant unobservable inputs to valuation (continued)
The Company carries the equity instrument as financial assets at fair value through other comprehensive income classified as level 3 within the fair value hierarchy. A reconciliation of the beginning and closing balances is summarized below:
| 2021 | 2020 | |||
|---|---|---|---|---|
| US’000 | US’000 | |||
| At January 1 | **** | **** | ||
| Re-measurement financial assets to fair value, recognized<br>in other comprehensive income/(loss) | ) | |||
| Exchange difference on translation | ) | ) | ||
| At June 30 | **** | **** |
All values are in US Dollars.
| 7. | INVENTORIES | |
|---|---|---|
| As of June 30,2021 | As of December 31,2020 | |
| --- | --- | --- |
| US’000 | US’000 | |
| Raw materials and supplies | ||
| Work in progress | ||
| Finished goods | ||
| Total inventories at the lower of cost and net realizable value |
All values are in US Dollars.
Inventories recognized as an expense during June 30, 2021 and 2020 amounted to $204,830, and $114,562 respectively.
For June 30, 2021 and 2020, the Company recognized allowance for inventory of $2,584 and $982 as an expense in cost of sales for inventories carried at net realizable value.
23
ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
| 8. | PROPERTY, PLANT AND EQUIPMENT | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Land | Buildings | Buildingimprovement | Machinery andequipment | Motor vehicleand other asset | Officeequipment | Construction inprogress | Total | |||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| US’000 | US’000 | US’000 | US’000 | US’000 | US’000 | US’000 | US’000 | |||||||||
| Cost | ||||||||||||||||
| At January 1, 2021 | **** | **** | **** | **** | **** | **** | **** | **** | ||||||||
| Additions | ||||||||||||||||
| Disposals | ) | ) | ) | ) | ||||||||||||
| Transfer | ) | |||||||||||||||
| Exchange differences | ) | ) | ) | ) | ) | ) | ) | ) | ||||||||
| At June 30, 2021 | **** | **** | **** | **** | **** | **** | **** | **** | ||||||||
| Depreciation/Impairment | ||||||||||||||||
| At January 1, 2021 | **** | ) | ) | ) | ) | ) | **** | ) | ||||||||
| Depreciation charge for the period | ) | ) | ) | ) | ) | ) | ||||||||||
| Impairment | ) | ) | ||||||||||||||
| Disposals | ||||||||||||||||
| Transfer | ) | ) | ||||||||||||||
| Exchange differences | ||||||||||||||||
| At June 30, 2021 | **** | ) | ) | ) | ) | ) | **** | ) | ||||||||
| Net book value | ||||||||||||||||
| At June 30, 2021 | **** | **** | **** | **** | **** | **** | **** | **** | ||||||||
| At January 1, 2021 | **** | **** | **** | **** | **** | **** | **** | **** |
All values are in US Dollars.
24
ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
| 9. | OTHER CURRENT LIABILITIES | |
|---|---|---|
| As of | ||
| --- | --- | --- |
| June 30, 2021 | December 31, 2020 | |
| US’000 | US’000 | |
| Contract liabilities | ||
| Dividend payable | ||
| Onerous contracts provisions | ||
| Other current liabilities | ||
| Total |
All values are in US Dollars.
Other current liabilities include undue value added tax, unpaid withholding tax, and other miscellaneous liabilities.
Onerous contracts provisions
| 2021 | 2020 | |||
|---|---|---|---|---|
| US’000 | US’000 | |||
| At January 1 | ||||
| Recognized | ||||
| Reversed | ) | ) | ||
| Exchange differences | ) | ) | ||
| At June 30 | **** | **** |
All values are in US Dollars.
25
ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
| 10. | RELATED PARTY TRANSACTIONS |
|---|
The related parties are defined as affiliates of the Company; entities for which investments are accounted for by the equity method by the Company; the principal owners of the Company; its management; members of the immediate families of the principal owners of the Company and its management.
Moon View Venture Limited (“Moon View”), PEWC, Singapore Branch, PEWC Singapore Co. (Pte) Ltd., and PEWC (HK) are controlled by PEWC. Moon View is the immediate holding company of the Company. Italian-Thai Development Public Company Limited (“Italian-Thai”) is the non-controlling shareholder of one of the Company’s operating subsidiaries in Thailand. SPHC is one of the Company’s equity investees. Fujikura Limited is a non-controlling shareholder of one of the Company’s operating subsidiaries in Thailand.
| 10(a) | Outstanding balance with related parties |
|---|
The following table provided the total amount of outstanding balance at June 30, 2021 and December 31, 2020.
| Amounts due from related parties | Amounts due to related parties | |||
|---|---|---|---|---|
| As of | As of | |||
| June 30, 2021 | December 31, 2020 | June 30, 2021 | December 31, 2020 | |
| US’000 | US’000 | US’000 | US’000 | |
| The ultimate parent company | ||||
| PEWC | ||||
| PEWC, Singapore Branch | ||||
| PEWC Singapore Co.<br><br><br>(Pte) Ltd. | ||||
| PEWC (HK) | ||||
| Associate | ||||
| SPHC | ||||
| Non-controlling shareholder of subsidiary | ||||
| Italian-Thai and its affiliates | ||||
| Others | ||||
| Total |
All values are in US Dollars.
As of December 31, 2020, the interest rates on the balance due to PEWC Singapore Co. (Pte) Ltd. range from 1.23% to 2.90%. In December 2020, this loan was repaid in full to PEWC Singapore Co. (Pte) Ltd.
In August 2020, APWC procured a total of $6 million secured loan by a pledge of the Company’s 98.3% ownership stake in Sigma Cable. This loan is a straight loan with a fixed interest rate of 3% per annum. In June 2021, the loan was repaid in full to PEWC.
26
ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
| 10. | RELATED PARTY TRANSACTIONS (continued) |
|---|---|
| 10(b) | Transactions with related parties |
| --- | --- |
The transactions undertaken with related parties are summarized as follows:
| For the period ended June 30, | |||
|---|---|---|---|
| 2021 | 2020 | ||
| US’000 | US’000 | ||
| The ultimate parent company | |||
| PEWC | Purchases | ||
| Sales | |||
| Management fee paid | |||
| Information technology service fee paid | |||
| Interest expenses paid | |||
| PEWC Singapore Co. (Pte) Ltd. | Interest expenses paid | ||
| PEWC (HK) | Sales | ||
| Service fee paid | |||
| Non-controlling shareholder of subsidiary | |||
| Italian Thai and its affiliates | Sales | ||
| Construction of factory building<br>expenses |
All values are in US Dollars.
10(c) Compensation of key management personnel of the Company
| For the period ended June 30, | ||
|---|---|---|
| 2021 | 2020 | |
| US’000 | US’000 | |
| Short-term employee benefits | ||
| Post-employment benefits | ||
| Total compensation paid to key management personnel |
All values are in US Dollars.
The amounts disclosed in the table were recognized as expenses during the reporting periods.
27
ASIA PACIFIC WIRE & CABLE CORPORATION LIMITED
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
| 11. | SUBSEQUENT EVENT |
|---|
Onerous contracts
The LME copper price rose sharply from US$9,385/ton on June 30, 2021 to US$9,955/ton on Oct 29, 2021, additional unrealized loss of US$ 1.4 million was recognized in the second half of 2021 for our Singapore subsidiary.
Other than the above events, the Company is not aware of any matter or circumstance that has significantly affected or may significantly affect the operations of the Company, the results of those operations, or the state of affairs of the Company.
| 12. | APPROVAL OF THE FINANCIAL STATEMENTS |
|---|
The financial statements were approved and authorized for issuance by the board of directors on November 8, 2021.
28