90
HG METAL MANUFACTURING LIMITED
ANNUAL REPORT 2014
NOTES TO THE
FINANCIAL STATEMENTS
for the financial year ended 31 December 2014
13.
INVESTMENT IN ASSOCIATES (CONT’D)
Name of associates
Principal activities
Country of
incorporation/
business
Proportion
of ownership
interest
2014 2013
% %
Held by the Company
POS-SEA Pte Ltd
(1)
Commission agent for
procurement of steel
products and materials
Singapore
32.45 32.45
Held by HG Metal Pte Ltd
BRC Asia Limited
(2)
Prefabrication and trading
of steel reinforcement
products and
manufacture and sale of
wire mesh fences
Singapore
22.46 23.58
(1)
Audited by Lee Seng Chan & Co, Singapore.
(2)
Audited by Ernst & Young LLP, Singapore.
During the year, the Company recognised an impairment loss of $645,000 (2013: Nil) on its
investment in associate (POS-SEA Pte Ltd) where its share of losses exceeds the Group’s interest
in this associate.
Dividends of $3,582,000 (2013: $3,160,000) and $61,000 (2013: $62,000) were received from BRC
Asia Limited and POS-SEA Pte Ltd respectively.
Dilution of interest in BRC Asia Limited (“BRC”)
During the financial year, BRC allotted and issued 44,493,000 (2013: $38,406,000) new ordinary
shares in the adoption of the BRC Share Option Scheme 2011 and grant of share options to the
executive directors and confirmed employees. As a result, the Group’s equity interest in BRC
decreased from 23.58% to 22.46% (2013: from 24.61% to 23.58%) and the financial effect of the
dilution of interest was approximately $194,000 (2013: $322,000).
