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ANNAIK LIMITED
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RESPONSE TO QUERIES RAISED BY THE SINGAPORE EXCHANGE
SECURITIES TRADING LIMITED ("SGX.ST")
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In response to the queries raised by the Singapore Exchange Securities Trading Limited ("SGX.ST") on 14 August 2007, the Directors of AnnAik Limited ("the Company") wish to provide the following information:-
a) Please provide reasons for the 21.9% or S$2.895m increase in Trade Receivables as at 30 June 2007 when revenue for the period increased by only 3.25% or S$1.03m. Please also disclose whether the debts are collectible.
The trade receivables as at 30 June 2007 is higher than the balance as at 30 June 2006 by 21.9% or S$2.895m primarily because of more project sales which generally have longer credit period and higher credit sales recognized in June 07. All the Company's trade debts at 30 June 2007 are collectible.
b) Please provide details and reasons for the increase in Other Receivables from S$4.1889m to S$6.452m as at 30 June 2007.
The increase in other receivables from $4.1889m to $6.452m as at 30 June 2007 was due mainly to advance payments made for purchase of machineries and equipment for our new manufacturing plant in China.
c) We note that the Group's administrative expenses increased mainly due to higher staff expenses. Please quantify and provide reasons for the increase in staff expenses when revenue increased only marginally.Group's administrative expenses for the first six months this year increased because of higher staff expenses. The higher staff expenses were attributed mainly to an increase in staff strength & higher payroll costs including bonuses (amount $643,000); higher share-based expenses resulting from grant of employee share options (amount $123,000) and staff training expenses (amount $50,000).
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