FRENCKEN GROUP LIMITED
ANNUAL REPORT 2015
80
NOTES TO FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2015 (CONT’D)
13 PROPERTY, PLANT AND EQUIPMENT (CONT’D)
During the year, the Group carried out a review of the recoverable amount of its property, plant and equipment. The
review led to the recognition of an impairment loss of $18,000 (2014 : $Nil) that has been recognised in the income
statement and included in the line item other operating expense.
Included in additions are plant and machinery acquired under finance leases amounting to $51,000 (2014 : $29,000).
The carrying amounts of plant and equipment, and motor vehicles held under finance leases are $794,000 (2014 :
$1,115,000) and $118,000 (2014 : $231,000) respectively.
Bank borrowings are secured on certain freehold land and buildings, machineries and other fixed assets of the Group
with carrying amounts of $8,790,000 (2014 : $15,327,000), $4,661,000 (2014 : $1,097,000) and $205,000 (2014 :
$Nil) respectively (Note 26).
14 SUBSIDIARIES
The Company
2015
$’000
2014
$’000
Equity investment
124,647
122,597
Equity contributions to subsidiaries
2,582
2,404
Advances to subsidiary
-
10,000
127,229
135,001
During the year, the Company capitalised the advances to subsidiary to share capital. The advances to subsidiary in
last year, which formed part of the net investment in subsidiaries, was unsecured, interest-free and are not expected
to be repaid in the foreseeable future, and are classified in equity of the subsidiaries.
The Company’s equity contributions to subsidiaries during the financial year are in respect of its share options granted
to the eligible employees (including executive directors) of the Group and credited to share option reserve.
On 28 January 2014, the Group’s subsidiary company, Frencken Europe B.V. acquired 100% equity interest in NTZ
International Holding B.V. (“NTZ”) for a cash consideration of $4,356,000 (net of escrow amount of $520,000).
The fair value of identifiable net assets of the NTZ at the date of acquisition amounted to $2,043,000, resulting in
goodwill of $2,313,000. Details of identifiable net assets acquired were disclosed in Note 22.
The details of the subsidiaries are as follows:
Name of subsidiary
Country of
incorporation/
place of
business
Effective equity interest
held by the Group
Principal activities
Company
Subsidiary
2015
%
2014
%
2015
%
2014
%
Precico Singapore
Pte Ltd
(6)
Singapore
100
100
-
-
Sales and servicing of
tools
