42
TELECHOICE INTERNATIONAL LIMITED
2015 ANNUAL REPORT
GROUP FINANCIAL
REVIEW
1.3 Other income
Other income comprises of interest, subsidy, rebates and rental income.
Higher other income in FY2015 was from government grants for the wage credit and temporary employment credit scheme.
There was also higher interest income arising from changes in amortised costs of long term receivables.
1.4 Total expenses
In $ million
FY2015
FY2014
Change (%)
Cost of sales
537.6
474.3
13%
Selling and marketing expenses
11.3
10.2
11%
Administrative expenses
18.1
19.0
-5%
Other expenses
1.1
1.7
-35%
Finance costs
1.0
1.1
-9%
Total expenses
569.1
506.3
12%
Included in total expenses:
Staff costs
45.4
42.2
8%
Depreciation and amortisation
2.9
3.4
-15%
Total expenses, including cost of sales, amounted to $569.1 million in FY2015, an increase of 12% or $62.8 million compared
to FY2014. Increase in total expenses by 12% is in line with the increase in revenue of 12%.
Cost of sales
comprises of cost of equipment sold, carrier costs and commissions, costs of cabling and installation, network
expenses, depreciation and amortisation and attributable direct overheads. Cost of sales increased by 13% or $63.3 million
over FY2014 due to increase in revenue in FY2015.
Selling and marketing expenses
increased by 11% or $1.1 million over FY2014 due to higher payroll cost and expenses relating
to the new master distributorship for prepaid cards.
Administrative expenses
were 5% or $0.9 million lower than the previous financial year mainly from lower payroll cost, lower
rental expenses and lower amortisation of computer software.
Other expenses
decreased by 35% or $0.6 million over FY2014 due to amortisation of intangible assets for S & I Systems Pte
Ltd (“
S&I
”) being fully amortised in October 2015 and foreign exchange gain. In FY2014, there were also property, plant and
equipment written off.
Finance costs
decreased by 9% or $0.1 million over FY2014 due to the absence of interest accretion from discounting dividend
payable to the selling shareholder of NxGen Communications Pte Ltd (“
NxGen
”).
Staff costs
increased by 8% to $45.4 million were mainly due to increase in headcount to support the retail and prepaid card
operations in Singapore and public sector projects for the ICT business.
Depreciation and amortisation cost
decreased by 15% or $0.5 million. Lower depreciation in FY2015 was due to certain assets
being fully depreciated. Lower amortisation in FY2015 was due to the ePlanet ecommerce portal having been fully amortised
in FY2014 and the intangible assets of S&I being fully amortised in October 2015.
