FINANCIAL STATEMENTS AND RELATED ANNOUNCEMENTS:: SECOND QUARTER RESULTS

NSL LTD

(Reg. no.: 196100107C)

Second Quarter Financial Statements Announcement

The figures have not been audited

PART I - INFORMATION REQUIRED FOR ANNOUNCEMENTS OF QUARTERLY (Q1, Q2 & Q3), HALF-YEAR AND FULL YEAR RESULTS

1(a) An income statement (for the group) together with a comparative statement for the corresponding period of the immediately preceding financial year

THE GROUP

Quarter ended 30 June 6 months ended 30 June

(restated)	(restated)
Continuing ope rations
Sales	83,519	84,555	(1)	169,623	167,832	1
Cost of sales	(75,946)	(68,480)	11	(153,120)	(138,005)	11
Gross profit	(2)	7,573	16,075	(53)	16,503	29,827	(45)
Other income	(3)	4,249	1,632	160	6,789	4,766	42
Other gains and losses	(4)	(6)	381	n/m	2,970	418	n/m
Distribution costs	(5)	(3,059)	(4,094)	(25)	(6,260)	(7,885)	(21)
Administrative expenses	(7,511)	(8,280)	(9)	(15,293)	(16,146)	(5)
Finance costs	(6)	(172)	(455)	(62)	(481)	(790)	(39)
Share of results of associated companies, net of tax	(7)	(111)	(179)	(38)	(545)	135	n/m
Profit before income tax	(1)	963	5,080	(81)	3,683	10,325	(64)
Income tax expense	(8)	(200)	(2,157)	(91)	(548)	(2,629)	(79)
Profit from continuing operations	763	2,923	(74)	3,135	7,696	(59)
Discontinue d opera tions
Profit from discontinued operations	(9)	-	4,345	n/m	-	8,045	n/m
Total profit for the financial period	763	7,268	(90)	3,135	15,741	(80)
Profit attributable to equity holders of the Company:

Note 2017 2016 Change 2017 2016 Change S$'000 S$'000 % S$'000 S$'000 %

- from continuing operations 983 2,668 (63) 3,568 7,301 (51)

(Loss) / profit attributable to non-controlling interest:
- from continuing operations	(220)	255	n/m	(433)	395	n/m
- from discontinued operations	-	380	n/m	-	611	n/m
(220)	635	(135)	(433)	1,006	n/m

- from discontinued operations - 3,965 n/m - 7,434 n/m 983 6,633 (85) 3,568 14,735 (76)

Basic and fully diluted earnings per share (cents)

- from continuing operations	0.26	0.71	(63)	0.96	1.95	(51)
- from discontinued operations	-	1.06	n/m	-	1.99	n/m

n/m: not meaningful

Notes to the Group's Income Statement

1. Profit before taxation from Continuing Operations is arrived at after crediting / (charging) the following items:

   THE GROUP

   Quarter ended 30 June	6 months ended 30 June
   2017 2016	2017 2016
   S$'000 S$'000 Note (restated)	S$'000 S$'000 (restated)
   Dividend income	1,909 1	1,909 1,481
   Interest income	1,136 1,130	2,724 2,174
   Amortisation of intangible assets	(i) (149) (46)	(296) (95)
   Depreciation of property, plant and equipment
   and investment properties	(ii) (3,094) (2,746)	(6,227) (5,500)
   Allowance for stocks obsolescence	- (68)	- (68)
   Write down of inventories, net	(ii) (209) (28)	(570) (99)
   Write back / (allowance) for impairment of trade
   receivables and bad debts written off, net	99 (48)	278 (22)
   Amortisation of deferred income	68 48	114 96

2. Increase was attributable to amortization of intangible assets arising from the acquisition of subsidiary CNC Petroleum Pte. Ltd. ("CNC") in August 2016.

3. Mainly arose from higher depreciation recorded by Precast & PBU division.

4. Increase in 1H-2017 was attributable to write-down of inventories in the Precast and PBU division.

5. Gross profit

   The decrease was due mainly to significantly lower gross profit margin for Precast operation in Singapore, Malaysia and Dubai.

6. Other income

   The increase in other income in 2Q-2017 and 1H-2017 was due mainly to higher dividend income from an available-for-sale financial asset.

7. Other gains and losses

   Quarter ended 30 June

   T HE GROUP

   6 months ended

   30 June

   2017 S$'000	2016 S$'000	2017 S$'000	2016 S$'000
   (restated) (restated)
   Fair value gains on derivative financial instruments	1	(211)	7	(58)
   Currency exchange (losses) / gains - net	(620)	33	(743)	(168)
   Insurance claim	1,049	-	1,049	-
   Investment properties - Gain on disposal	73	-	3,579	-
   Property, plant and equipment - Gain on disposal and write-off, net	12	781	10	776
   - Allowance for impairment, net	(373)	(6)	(758)	-

   Others	(148) (216)	(174) (132)
   (6) 381	2,970 418

   Notes to the Group's Income Statement (continued)

8. Distribution costs

   The decrease was attributable to lower staff costs in the Precast & PBU division.

9. Finance costs

   The decrease in finance costs in 2Q-2017 and 1H-2017 were attributable to a reduction in Group borrowings.

10. Share of results of associated companies, net of tax

    The lower loss in share of results of associated companies in 2Q-2017 was due mainly to PEINER SMAG Lifting Technologies GmbH ("PSLT"), of which the Company owns 33.33% non-controlling equity stake. Share of losses from associated companies in 1H-2017 related to half year losses suffered by PSLT and Malaysian associate Southern Rubber Works Sdn Bhd.

11. Income tax expense

    Quarter ended 30 June

    THE GROUP

    6 months ended 30 June

    Continuing Operations	2017 2016 S$'000 S$'000 (restated)	2017 2016 S$'000 S$'000 (restated)
    Taxation (charge) / credit for the financial period comprises:
    - Current period taxation	(i)	(200) (1,505)	(163) (2,001)
    - Under provision in respect of prior years	(ii)	- (652)	(385) (628)
    (200) (2,157)	(548) (2,629)

12. Tax expenses were lower as compare to the corresponding periods last year mainly due to lower profit before tax. The effective tax rate of the Group in 1H-2017 was lower than the Singapore corporate tax rate due mainly to gain from divestment of investment property not subjected to tax.

13. Under-provision in respect of prior years in 1H-2017 due mainly to deferred tax liabilities of the Company not recognised in FY2016.

Notes to the Group's Income Statement (continued)

14. Profit from discontinued operations

An analysis of the results of discontinued operations is as follows:

Quarter ended 30 June	6 months ended 30 June
2017 2016	2017 2016
S$'000 S$'000	S$'000 S$'000
(restated)	(restated)
Sales	- 25,809	- 50,912
Net expenses	- (20,633)	- (41,303)
Share of results of associated companies, net of tax	- (22)	- (68)
Profit before tax from discontinued operations	- 5,154	- 9,541
Income tax expense	- (817)	- (1,504)
Profit after tax from discontinued operations	- 4,337	- 8,037
Exceptional gains on disposal of subsidiaries	- 8	- 8
Profit after tax from discontinued operations	- 4,345	- 8,045
*Breakdown of profit from discontinued operations
Quarter ended 30 June	6 months ended 30 June
2017 2016	2017 2016
S$'000 S$'000	S$'000 S$'000
(restated)	(restated)
Dry Mix operations	- 4,337	- 8,037
Exceptional gain on disposal
- Lime business	- 8	- 8
- 4,345	- 8,045

a) The disposal of dry mix business in Singapore, Hong Kong, China and Malaysia was completed on 14 December 2016.

The dry mix division was a separate major line of business of the Group. In accordance with FRS 105, Non-current Assets Held for Sale and Discontinued Operations, results of the dry mix business were disclosed as part of discontinued operations in FY2016.