第99.1展示文本

管理層討論和分析
財務狀況和經營業績的結果

本管理層討論與分析旨在爲您提供關於截至2023年和2024年6月30日的我們的財務狀況和經營業績的敘述性解釋。本部分應與我們未經審計的簡明合併財務報表及本中期報告中的相關附註一起閱讀。我們還建議您閱讀我們2023財年的管理層討論與分析以及審計的合併財務報表及附註，這些內容包含在我們於2023年12月31日結束之前申報給美國證券交易委員會的招股書中，招股書於2024年10月17日提交。

在本報告中，如在本報告中使用，除非上下文另有說明，「Springview」，「公司」，「我們」，「我們」或「我們」 指的是SpringView Holdings Ltd及其子公司和其他合併實體的業務總稱。對「美元」和「US$」的引用是指美元，美國的法定貨幣。對「S$」的引用是指新加坡元，新加坡的法定貨幣。對「SEC」的引用是指證券和交易委員會。

所有基本報表均按照美國通用會計準則或U.S. GAAP進行編制。我們對本管理層討論和分析中包含的部分數字進行了四捨五入調整。因此，部分表格中顯示的數字總額可能不是前面數字的算術聚合。本討論包含涉及風險、不確定性和假設的前瞻性聲明。由於各種因素，我們的實際結果可能與這些前瞻性聲明中預期的結果有實質性不同。

概述

我們公司通過間接完全擁有的子公司Springview Enterprises Pte. Ltd.（「Springview Singapore」）在新加坡設計和建造住宅和商業建築。

我們的項目涵蓋四種主要工作類型：(i) 新建 施工， (ii) 重建， (iii) 添加和改裝 (A&A)，以及 (iv) 其他施工服務。對於新建施工，現有房屋將被拆除並重新建造。我們的重建工作涉及對房屋的部分實質性更換。對於A&A工作，我們專注於對現有建築結構進行輕微修改以滿足現有建築的要求。我們還提供其他施工服務，例如爲客戶進行翻新和設計諮詢。通過與客戶的對話，以了解他們的願景和預算限制，我們幫助他們制定出可行的設計概念。

我們的項目可以通過(a)設計施工模式或(b)施工模式開展。當我們擔任設計施工角色時，我們提供設計意見並且擔任主要承包商。對於施工模式，我們僅擔任承包商角色。對於設計施工角色，我們與相關建築公司合作，提供量身定製的解決方案，包括概念設計圖紙和詳細實施計劃，然後通過我們經驗豐富的設計團隊和施工團隊的共同努力來執行。對於承包商角色，我們基於團隊經驗和與建築師和分包商的現有關係，爲客戶提供質量施工工作。

憑藉自2002年迄今的相當悠久運營歷史，我們相信通過與客戶建立良好關係，在繁忙的新加坡房地產開發市場樹立了積極的聲譽，從而獲得了老客戶的推薦。我們的運營團隊負責處理諮詢和反饋，與分包商合作解決項目中出現的任何問題。我們認爲通過電話和即時通訊進行有效溝通可以確保快速解決問題。反過來，我們認爲我們對高質量服務的承諾和解決客戶反饋對於擴大我們的市場份額和確保公司整體業務成功至關重要。

影響我們財務狀況和運營結果的因素

我們的經營業績受到並將繼續受到多種因素的影響，包括以下所列因素:

我們在一個競爭激烈的行業板塊中運營，我們的競爭對手可能在獲得合同方面更加成功

我們在施工行業面臨着激烈的競爭，某些競爭對手可能擁有更多的財力和人力資源，更強大的業績記錄和更加 established的聲譽，從而讓他們在尋找新客戶和業務機會方面具有優勢。此外，我們的競爭對手可能會在定價政策上更有侵略性，或者提供額外的服務來在我們參與的招標中獲得合同。我們相信我們在市場上已建立起了良好的聲譽和顯著的品牌，爲高質量項目的完成以及我們與客戶、分包商、供應商和外部顧問的牢固關係，連同這些關係作爲可靠的新項目推薦來源，都將幫助我們在市場上保持競爭力並有效地獲得新客戶。但是，如果我們無法保持按時向客戶交付高質量項目的聲譽，可能會導致我們無法成功競爭我們的競爭對手，且可能會對我們的業務和運營結果產生不利影響。

由於我們業務的性質，我們的營業收入和盈利能力是不可預測的

我們的施工項目營業收入具有非經常性質，且以項目爲基礎，這導致我們的營業收入和盈利在不同時期出現不可預測性。我們根據已完成工作的比例確認進行中合同的營業收入，某些進行中合同可能持續一年以上，這類項目的營業收入可能在不同財政年度中確認。根據我們進行中合同的完成階段，某財政期間確認的營業收入和盈利可能會波動，因此，短期財務狀態的結果可能不代表我們業務未來的財務表現和前景。爲了確保營業收入增長，我們不斷通過參與招標和從各種渠道尋求推薦積極構建合同儲備。然而，並不能保證我們能夠成功地獲得新項目來替代已完成的項目，或者持續獲得具有更高或可比合同價值和利潤率的項目，這可能對我們的業務和運營結果產生重大不利影響。

通常，我們依賴承包商和供應商履行其義務，以完成我們的項目並滿足客戶的要求

提供施工服務是非常苛刻的，並需要我們的公司有效地協調和利用內部和外部資源，後者主要涉及分包商和供應商。我們依賴於分包商和供應商爲我們提供我們委託他們提供的建築材料和通風工作等質量產品或服務，以履行我們向客戶交付基於合同工作範圍和設計的完工項目的承包責任。雖然我們已經與幾家可靠的供應商和分包商建立並保持了良好的關係和融洽，他們一直按時向我們提供優質產品和服務，但不能保證他們將來會繼續提供符合我們質量和時間要求的產品和服務。此外，儘管我們公司已經盡最大努力對我們的項目中參與的分包商進行篩選，評估其能力基於包括業績記錄、聲譽和價格競爭力在內的幾個因素，我們仍然承擔着與分包商不符合要求或未履約的某些風險，因爲分包商與我們的客戶沒有直接的合同關係。此外，我們與分包商或供應商沒有任何長期協議，因此不能保證我們能以符合我們預算的合理費率從現有的分包商或供應商那裏採購類似的安排，或者如果發生這樣的事件，我們可以成功地與其他提供者合作，這可能導致我們的業務和經營業績受到重大和不利影響。

我們受制於幾個宏觀經濟、監管、社會以及其他我們無法控制的因素

我們在新加坡的建築和主要的A＆A行業中進行業務，受到宏觀經濟、監管、社會和政治等多種因素的影響，這些因素超出了我們公司的控制範圍。我們依賴新加坡繼續成爲一個穩定而具吸引力的居住地，因爲我們的大多數客戶都是尋求建造符合他們願望的物業的住宅業主。我們在新加坡的目標客戶群體增長可能會受到該國政治和社會穩定性、與稅收和移民相關的關鍵政策和法規以及整體商業和市場情緒等因素的影響，所有這些都超出了我們的控制。此外，我們的業務還會受通貨膨脹和利率環境的影響。截至招股說明書日期，我們已經看到通脹對我們業務的影響。例如，由於通貨膨脹的影響，我們看到建築材料的價格和勞工工資上漲。未來如果通脹壓力加劇，我們的項目成本可能會進一步提高。我們無法保證我們能夠將這些成本上漲的結果有效地轉嫁給客戶。利率上升還可能導致我們業務的借款成本增加。不能保證我們無法預測超出我們控制範圍的這些因素是否會發展成爲可能對我們未來業務運營產生不利和重大影響的方式。

運營結果

截至2023年和2024年6月30日的六個月

以下表格詳細列出了我們未經審計的綜合經營成果，包括絕對金額和截至2023年和2024年6月30日的淨收入百分比。這些信息應與我們未經審計的基本報表和相關說明一起閱讀。任何時期的經營成果未必能反映將來任何時期可能出現的結果。

2023年和2024年截至6月30日六個月的比較

營業收入

我們主要通過施工項目獲取營業收入，主要涵蓋以下幾大類工作：(i) 新建築、(ii) 改建、(iii) 增加和改建（A&A），以及(iv) 其他一般承包服務，如翻新和設計諮詢。由於我們的業務特性，我們的大部分營業收入來自具有不同合同規模的獨立項目，是一次性收入。我們根據施工項目的完成程度和實際成本相對於項目總估算成本的爲基礎，通過輸入法識別並逐步確認我們的營業收入。

下表列明瞭我們按營業收入類別和期間指示的營業收入。

截至2023年6月30日和2024年，涉及新建施工項目的項目佔我們營業收入的最大比例，分別佔總營業收入的約31.4%和95.4%。重建工作的營業收入分別佔截至2023年和2024年6月30日的總營業收入約24.7%和0%，而A＆A工作的營業收入分別佔總營業收入的約30.6%和4.6%。

Our total revenue increased by S$1,586,391, or 47.0%, from S$3,374,927 for the six months ended June 30, 2023, to S$4,961,318 ($3,657,710) for the six months ended June 30, 2024. This increase is primarily driven by an increase in revenue recognized from new construction work of S$3,672,875, or 346%, from S$1,061,220 for the six months ended June 30, 2023 to S$4,734,096 ($3,490,192) for the six months ended June 30, 2024. This substantial increase is primarily attributed to two factors: First, we initiated a major new construction project with a contract sum of S$2.9 million in the first two quarters of 2024, which generated approximately S$0.9 million in revenue. Second, we ramped up work on three existing sizeable projects that started in the second half of 2023. These projects are worth up to S$7.4 million in total, with S$3.2 million revenue recognized in the first half of 2024.

Revenue recognized from reconstruction work declined by S$835,098, or 100%, from S$835,098 for the six months ended June 30, 2023 to S$0 ($0) for the six months ended June 30, 2024. This decline resulted from the completion of the last project in August and November 2023, with no new reconstruction projects initiated in the subsequent period. Similarly, revenue recognized from A&A work declined by S$804,050 or 78%, from S$1,031,272 for the six months ended June 30, 2023 to S$227,222 ($167,518) for the six months ended June 30, 2024, due to more work was performed in the earlier period with two major projects done to near completion in December 2023, and no new A&A work initiated in the subsequent period. Additionally, our other general contracting services also decreased by 447,337, or 100%, from S$447,337 for the six months ended June 30, 2023 to S$0 (US$0) for the six months ended June 30, 2024, primarily due to the absence of new design consultancy services in the first two quarters of 2024.

All of our revenue is derived from projects contracted with residential customers for the six months ended June 30, 2024. Revenue from commercial customers decreased by S$1,223,723, or 100% from S$1,223,723 for the six months ended June 30, 2023 to nil for the six months ended June 30, 2024. This decrease is primarily due to no revenue being recognized for this project in the first half of 2024, and the absence of design consultancy services during this period. Revenue from residential customers increased by S$2,810,114, or 130.6% from S$2,151,204 for the six months ended June 30, 2023 to S$4,951,318 for the six months ended June 30, 2024. This increase is primarily due to more revenue being recognized for the new construction projects in the first half of 2024.

Cost of revenue

The cost of revenue primarily consisted of subcontracting costs, material costs, labor costs, equipment rental and site costs and other direct costs incurred in contract performance. The total cost of revenue increased by S$1,154,878, or 46.6%, from S$2,477,512 for the six months ended June 30, 2023, to S$3,632,390 ($2,677,964) for the six months ended June 30, 2024. The approximately 93.9% overall increase in cost of revenue was in line with our increase in revenue, and primarily driven by a higher subcontracting cost incurred, which increased by S$ 808,542, or 93.9%, from S$860,651 for the six months ended June 30, 2023 to S$1,669,193 ($1,230,605) for the six months ended June 30, 2024. This increase was primarily driven by our strategic decision to secure and execute larger projects, which necessitated higher engagement with subcontractors. The larger projects with higher contract sums required more specialized subcontractor services, resulting in a significant increase in subcontracting expenses.

On the other hand, material costs showed a modest increase, rising by S$139,678, from S$642,743 to S$782,421 ($576,836). This 21.7% increase can be attributed to the procurement of higher-quality materials to meet the specifications of our larger projects, although the increase was contained through better pricing negotiations with suppliers. Labor costs increased by S$139,255, from S$522,256 to S$661,511 ($487,696), reflecting a 26.7% increment. This increase was largely due to higher number of workers. Lastly, equipment rental and site costs also rose slightly by S$34,548, from S$144,526 to S$179,074 ($34,548), representing an 23.9% increment, driven by the need for additional equipment to support our expanding project portfolio. These increases reflect our strategic investments in quality materials, skilled labor, and necessary equipment to meet project demands.

Gross Profit

For the six months ended June 30, 2023 and 2024, our gross profits were S$897,415 and S$1,328,928 ($979,746), respectively, and our gross profit margins were approximately 26.6% and 26.8%, respectively. Our gross profit increased by S$431,513, or approximately 48.1% primarily due to the significant increase in revenue recognized due to the larger projects that we worked on for the six months ended June 30, 2024.

General and Administrative Expenses

The following table sets forth a breakdown of our general and administrative expenses for the periods indicated.

General and administrative expenses consisted primarily of staff expenses, depreciation and amortization, operating lease expenses, medical and insurance, transport and entertainment, professional fees, provision for fines and charges and other miscellaneous expenses. General and administrative expenses increased by S$382,577 or approximately 66.9%, from S$571,798 for the six months ended June 30, 2023, to S$954,366 ($703,602) for the six months ended June 30, 2024, mainly due to an increase in professional fees resulted from incurrence of accounting, auditing in connection with the preparation and audit of financial statements under US GAAP. Additionally, staff expenses increased by S$40,255, or approximately 11.9%, from S$339,352 to S$379,607 ($279,864), mainly due to the increased number of employees from 63 to 74 to support our business and operation expansion. Lease expenses increased by S$16,000 or approximately 25.0% from S$63,916 to S$79,916 ($58,918) due to the new staff accommodation.

Interest Expenses, Net

Interest expenses, net mainly included accrued interest from loans and borrowings, lease liabilities and amount due to a related party. Interest expenses, net increased by S$25,565, or approximately 90.3% from S$28,309 for the six months ended June 30, 2023, to S$53,874 ($39,718) for the six months ended June 30, 2024. The increase was mainly due to an increased in amount borrowed from loans and borrowings from S$28,309 for the six months ended June 30, 2023 to S$49,015 (US$36,136) for the six months ended June 30, 2024

Other Income

Other income primarily consisted of government grants and other miscellaneous income. Other income decreased by S$781 or approximately 21.9% from S$3,570 for the six months ended June 30, 2023, to S$2,789 (US$2,056) for the six months ended June 30, 2024. This decline was primarily due to a reduction in government support.

Income Tax Expense

Our income tax expenses were S$35,128 and S$76,053 ($56,070) for the six months ended June 30, 2023 and 2024, respectively. We incurred higher income tax expenses for the six months ended June 30, 2024 which is in line with our higher income before income taxes provision resulting primarily from higher revenue and gross profit recognized for the period.

Net Income

As a result of the foregoing, our profit for the year decreased by S$18,335, or approximately 6.9%, from S$265,759 for the six months ended June 30, 2023, to S$247,424 ($182,412) for the six months ended June 30, 2024.

Earnings Per Share

Our earnings per share decreased by approximately S$0.002, or 19.4%, from approximately S$0.013 for the six months ended June 30, 2023 to approximately S$0.012 ($0.009) for the six months ended June 30, 2024. The computation of earnings per share is based on 20,000,000 of the total issued and outstanding shares of our Class A Shares and Class B Shares, retrospectively after a reorganization of our company.

Liquidity and Capital Resources

As of December 31, 2023 and June 30, 2024, our cash balances amounted to approximately S698,106 and S$153,914 ($113,472), respectively, and our current assets were S$6,048,082 and S$5,590,235 ($4,121,377), respectively, and our current liabilities were S$3,363,968 and S$2,966,337 ($2,186,919), respectively. For the six months ended June 30, 2023 and 2024, we generated profit of S$265,759 and S$247,424 ($182,412), respectively.

On October 17, 2024, we completed the initial public offering (the “IPO”) by issuing 1,500,000 Class A Ordinary Shares at a public offering price of $4.00 per share, for aggregate gross proceeds of approximately $6.0 million. The net proceeds to the Company from the IPO, after deducting the underwriting discount, the underwriters’ fees and expenses, and the Company’s estimated offering expenses, were approximately $5.2 million.

Cash Flows Analysis

For the six months ended June 30, 2024 and 2023

The following table sets forth a summary of our cash flows for the periods indicated.

Operating Activities

Changes in cash flow from operating activities from the six months ended June 30, 2023 to the month ended June 30, 2024

We had net cash used in operating activities of S$186,104 ($137,205) for the six months ended June 30, 2024, compared to net cash used in operating activities of S$106,977 for the six months ended June 30, 2023. The increase in cash flow used in operating activities for six months ended June 30, 2024, is primarily a result of:

Investing Activities

For the six months ended June 30, 2023 and 2024, no investing activities occurred.

Financing Activities

For the six months ended June 30, 2023, net cash used in financing activities was S$127,032 which was primarily consisted of proceeds from loans and borrowings of S$300,000 and offset by repayment of loans and borrowings of S$195,589, repayment of amount due to a related party of S$202,715 and payment for finance lease obligations of S$28,728.

For the six months ended June 30, 2024, net cash provided by financing activities was S$358,089 ($263,999) which was primarily consisted of consisted of proceeds from loans and borrowings of S$319,713 ($235,708) and offset by repayment of loans and borrowings of S$233,756 ($172,336) and payment of offering cost of S$435,297 ($320,921).

Contingencies

In the normal course of business, our company is subject to contingencies, including legal proceedings and claims arising out of the business that relate to a wide range of matters, such as government investigations and tax matters. Our company recognizes its liability for such contingency if it determines it is probable that a loss has occurred, and a reasonable estimate of the loss can be made. Our company may consider many factors in making these assessments including historical and the specific facts and circumstances of each matter.

As of June 30, 2024 and December 31, 2023, our company is subject to legal proceeding from a charge by Ministry of Manpower for an offence under Section 12(1) of the Workplace Safety and Health Act for failure to take measure to ensure the safety of its employees at work in one of its construction projects in 2019 which resulted in injuries to one worker and one fatality. Our company has claimed trial to this charge. For the same incident, our company was also charged under Section 5 of the Building Control Act for carrying out building work that was not approved by the Commissioner of Building Control. Additionally, our company is also subject to a claim from an employee of a subcontractor for a construction project for damages arising out of injuries and loss suffered as a result of work accident at the project site. The claimant seeks to hold our company and the subcontractor jointly and severally liable for the claim.

As of June 30, 2024 and December 31, 2023, our company’s accrued provision for the legal proceedings was S$385,000 ($283,840) and $385,000, respectively. For the six months ended June 30, 2023 and 2024, our company’s provision for estimated litigation loss was nil and nil, respectively

Capital Expenditures

No capital expenditures were incurred for the six months ended June 30, 2023 and 2024, as there were no purchases of property, plant, or equipment.

Off-Balance Sheet Commitments and Arrangements

We have not entered into any off-balance sheet financial guarantees or other off-balance sheet commitments to guarantee the payment obligations of any third parties. We have not entered into any derivative contracts that are indexed to our shares and classified as shareholder’s deficit/(equity) or that are not reflected in our consolidated financial statements. Furthermore, we do not have any retained or contingent interest in assets transferred to an unconsolidated entity that serves as credit, liquidity or market risk support to such entity. We do not have any variable interest in any unconsolidated entity that provides financing, liquidity, market risk or credit support to us or engages in leasing, hedging or product development services with us.

Contractual Obligations

For the six months ended June 30, 2024

The following table sets forth certain contractual obligations as of June 30, 2024 and the timing and effect that such obligations are expected to have on our liquidity and capital requirements in future periods:

Concentration of Credit Risk

Financial instruments that potentially subject our company to the concentration of credit risks consist of cash, accounts receivable and amounts due from a related party. The maximum exposures of such assets to credit risks are their carrying amounts as of the balance sheet dates. Our company deposits its cash with financial institutions located in Singapore. As of December 31, 2023 and June 30, 2024, S$698,106 and S$153,914 ($113,472) were deposited with financial institutions located in Singapore. The Deposit Protection Scheme introduced by the Singapore Government insured each depositor at one bank for a maximum amount of S$75,000. Our company believes that no significant credit risk exists as these financial institutions have high credit quality and our company has not incurred any losses related to such deposits.

For the credit risk related to accounts receivable, our company performs periodic credit evaluations of its customers’ financial condition and generally does not require collateral. Our company determines its allowance for credit losses for account receivable using an aging schedule. Our company estimates the credit loss rates based on historical loss information, aging of receivables and management’s judgements, including current and reasonable and supportable forecasted economic conditions compared to the economic conditions using the historical information. The management believes that its contract acceptance, billing and collection policies are adequate in minimizing material credit risk. Application of progress payment of contract work is made on a regular basis. Our company seeks to maintain strict control over its outstanding receivables.

Credit risk on amounts due from a related party is not significant as the timing of payment is controlled by common director and shareholders taking into account cash flow requirements of our company and there has been no significant increase in the risk of default nor impairment recognized on the amounts due from a related party since initial recognition.

Currency risk

Our company’s operating activities are transacted in S$. Foreign exchange risk may arise from future commercial transactions, and from fluctuations and the degree of volatility of foreign exchange rates between $ and S$.

Concentration of Customers

For the six months ended June 30, 2023, four customers accounted for approximately 23%, 18%, 17% and 16% of the company’s total revenue. For the six months ended June 30, 2024, four customers accounted for approximately 28%, 24%, 18% and 13% of the company’s total revenue.

As of December 31, 2023, three customers accounted for approximately 12%, 23% and 65% of the total accounts receivable. As of June 30, 2024, three customers accounted for approximately 45%, 44% and 11% of the total accounts receivable.

Concentration of Vendors

For the six months ended June 30, 2023 and 2024, our company did not have significant suppliers or subcontractors accounting for more than 10% of total purchases.

The table below sets out the suppliers or subcontractors who accounted for 10% or more of our company’s total accounts payable as of December 31, 2023 and June 30, 2024.

Critical Accounting Policies and Use of Estimates

Our consolidated financial statements included elsewhere in this prospectus have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the periods presented. Out of our significant accounting policies, which are described in Note 3 — Summary of Significant Accounting Policies of our consolidated financial statements included elsewhere in this Form F-1, certain accounting policies are deemed “critical”, as they require management’s highest degree of judgement, estimates and assumptions. Management bases its estimates on historical experience and on various other assumptions believed to be reasonable. Authoritative pronouncements, historical experience and information, information that is currently available to our company and assumptions that our company believes to be reasonable under the circumstances are used as the basis for making estimates and judgements. Actual results may differ from these estimates.

Revenue Recognition

Our company adopted Accounting Standards Codification 606, Revenue from Contracts with Customers (“ASC 606”), on January 1, 2021 using the modified retrospective approach. Our company’s accounting for revenue recognition remains substantially unchanged prior to adoption of ASC 606. The effect from the adoption of ASC 606 was not material to our company’s consolidated financial statements.

Our company recognizes revenue to depict the transfer of promised goods or services (that is, an asset) to customers in an amount that reflects the consideration to which our company expects to receive in exchange for those services. The following five steps defined under ASC 606 are applied to achieve the core principle of revenue standard:

Our company generates revenue mainly from construction projects with the following major categories of works: (i) new construction, (ii) reconstruction, (iii) A&A, and (iv) other general contracting services, such as renovation and design consultation. For new construction, the existing house will be demolished, and a new house will be rebuilt. Reconstruction works involve replacement of substantial part of the house. For A&A works, minor modifications are made to existing structures within the existing building requirements while other general contracting services include renovation and design consultation services.

Our company assessed that the four major categories of revenue share the substantially the same characteristics and nature of terms in our contracts with customers and follows the same pattern of transfer of promised services to customers, and thus apply the same revenue recognition policies to all our revenue.

Our company enters into construction contracts with customers that create enforceable rights and obligations and for which it is probable that our company will collect the consideration to which it will be entitled as services are transferred to the customers. It is standard practice for our company to have the agreements with our customers in writing. All the agreements have commercial substance, as each contract with the customer has payment terms specified based upon fulfilment of certain conditions and agreed methods charged on monthly basis. Our company will submit monthly progress claim to the customer, and after our company receives the interim progress certificate certified by the appointed quantity surveyor, our company will issue a sales invoice to the customer. As our company’s customers are required to pay at different billing stages over the contract period, such progress payments limit our company’s exposure to credit risk. Our company also reasonably expects that the effects on the financial statements of applying ASC 606 to the portfolio of contracts would not differ materially from applying ASC 606 to the individual contracts within that portfolio.

Our company is responsible for a series of work including but not limited to those stated under the scope of work, which can include the design of the project, obtaining the relevant permits and approvals from authorities, engineering, site clearance, procurement of materials, construction and interior fitting-out/installation as part of the contract. Our company believes these services are not distinct as they are highly interrelated and the contract includes a significant service of integrating the various services into the combined work the customer is contracting for, which is the completed property. The contracts may include retentions paid at the end of the project as a warranty to ensure our company meets the contract requirements. However, since the customer does not have the option to separately purchase the warranty and there are no additional services to the customer during the retention period, such warranty is not recognized as a separate performance obligation. Our company has concluded that the promises to be delivered on the construction contract would be one single performance obligation, and therefore no allocation of the transaction price is required.

Our company’s contracts with each customer are with fixed price and provide for milestone billings based upon the attainment of specific project objectives to ensure our company meets the contractual requirements. The contract does not have variable consideration. However, the contract subject to modification in the form of unpriced or pending change orders or claims that either increase or decrease the contract price. Contract modification is accounted for as part of the existing contract as the remaining work is not distinct and form part of a single performance obligation that is partially satisfied at the date of the contract modification. The impact of contract modification has on the contract price and our company’s measure of progress towards complete satisfaction of the performance obligation is recognized as a cumulative catch-up adjustment to revenue at the date of contract modification.

Our company is not required to assess whether a contract contains a significant financing component if our company expects, at contract inception, that the period between payment by the customers and the transfer of promised services to the customers will be less than one year. Further, our company believes that with its monthly progress billings there is no financing component in its contracts. There are no non-cash and payable consideration for any services provided by our company.

Critical Accounting Estimates

Our company recognizes revenue based on our company’s actual contract costs incurred to the satisfaction of a performance obligation relative to the total estimated costs for the satisfaction of that performance obligations. This input method faithfully depicts the transfer of value to the customer when our company is satisfying a performance obligation that includes several interrelated tasks or activities for a combined output that requires our company to coordinate the work of subcontracts and employees. The critical estimate is the total estimated costs, which includes labor, materials, overhead, and subcontractor expenses. Accurate estimates are vital to avoid cost overruns and ensure profitability and is crucial to the revenue recognition based on the calculation of percentage of completion. To ensure the reasonableness of the total estimated cost, we usually rely on historical data, industry benchmarks, and professional expertise to develop these estimates on individual project level. Regular reviews and adjustments are necessary as new information becomes available throughout the project lifecycle. The following describes how we apply the key assumptions:

Project Scope: Changes in the project scope can affect cost estimates and, consequently, the completion percentage.

Schedule Variability: Delays or accelerations in project timelines can impact the percentage of completion.

Cost Overruns and Underruns: Unexpected increases or decreases in costs can skew percentage calculations. Regularly updating estimates is critical.

Forecasting Future Costs: Accurate forecasting of remaining costs is crucial. This may involve historical data, industry standards, and professional judgment based on project specifics and conditions.

Contract costs typically include direct labor, subcontract, professional costs, material and indirect costs related to contract performance. Changes in estimated costs to complete these obligations result in adjustments to revenue on a cumulative catch-up basis, which causes the effect of revised estimates to be recognized in the current period. No significant changes to estimated costs has occurred and there is no material impact on its revenue recognition for the six months ended June 30, 2023 and 2024.

When the current estimates of the total amount of consideration expected to be received in exchange for transferring promised goods or services to the customer, and contract costs indicate a loss, a provision for the entire loss on the contract is made as soon as the loss become evident. An adjustment is also made to reflect the effects of the customer’s credit risk. The loss on a contract is reported as an additional contract cost (an operating expenses), and not as a reduction of revenue or a non-operating expense. The total loss on contracts is negligible for the six months ended June 30, 2023 and 2024.

Our company recognizes revenue over time for all projects throughout the contract period.

Recently Issued Accounting Pronouncements

Our company considers the applicability and impact of all accounting standards updates (“ASUs”). Management periodically reviews new accounting standards that are issued. Under the Jumpstart Our Business Startups Act of 2012, as amended (the “JOBS Act”), our company meets the definition of an emerging growth company and has elected the extended transition period for complying with new or revised accounting standards, which delays the adoption of these accounting standards until they would apply to private companies.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which updates reportable segment disclosure requirements and is intended to improve disclosures about a public entity’s reportable segments and addresses requests from investors and other allocators of capital for additional, more detailed information about a reportable segment’s expenses. The amendments are effective for fiscal years beginning after December 15, 2023 and for interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. The amendments should be applied retrospectively to all prior periods presented in the financial statements. Our company is currently evaluating this ASU to determine its impact on our company’s disclosures.

Except as mentioned above, our company does not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on our company’s consolidated balance sheets, statements of operations and comprehensive income and statements of cash flows.

SPRINGVIEW HOLDINGS LTD

INDEX TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS

SPRINGVIEW HOLDINGS LTD

CONDENSED CONSOLIDATED BALANCE SHEETS

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

SPRINGVIEW HOLDINGS LTD
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

SPRINGVIEW HOLDINGS LTD
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ (DEFICIT)/ EQUITY

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

SPRINGVIEW HOLDINGS LTD

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

SPRINGVIEW HOLDINGS LTD
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED JUNE 30, 2023 and 2024

Note 1 — NATURE OF BUSINESS AND ORGANIZATION

Springview Holdings Ltd (the “Company” or “Springview (Cayman)”) is a holding company incorporated on September 27, 2023 in Cayman Islands while Springview (BVI) Ltd was incorporated on October 11, 2023 in the BVI with the Company being the sole shareholder of Springview (BVI) Ltd. The Company conducts its business primarily through its indirect wholly-owned subsidiary in Singapore, Springview Enterprises Pte. Ltd., providing four main types of works: (i) new construction, (ii) reconstruction, (iii) Additions and Alterations (A&A), and (iv) other general contracting services. For new construction, the existing house will be demolished, and a new house will be rebuilt. Reconstruction works involve replacement of substantial part of the house. For A&A works, minor modifications are made to existing structures within the existing building requirements while other general contracting services include renovation and design consultation services. The Company is a holding company with no business operation.

As at June 30, 2024, subsidiary of the Company includes the following entity:

Pursuant to a group reorganization (the “Reorganization”) to rationalize the structure of the Company and its subsidiary in preparation for the listing of the Company’s shares, the Company became the holding company on December 1, 2023. The Company and its subsidiary were under common control of the shareholders and their entire equity interests were also ultimately held by the shareholders immediately prior to the Reorganization, which have been accounted for as reorganization of entities under common control at carrying value. The consolidated financial statements are prepared on the basis as if the reorganization became effective as of the beginning of the first period presented in the accompanying consolidated financial statements of the Company.

Note 2 — LIQUIDITY

In assessing the Company’s liquidity, the Company monitors and analyzes its cash balances and its operating and capital expenditure commitments. The Company’s liquidity needs are to meet its working capital requirements, operating expenses and capital expenditure obligations.

As of December 31, 2023 and June 30, 2024, the Company’s cash balances amounted to approximately S$698,106 and S$153,914 ($113,472) respectively. For the six months ended June 30, 2023 and 2024, we generated profit of S$265,759 and S$247,424 ($182,412), respectively. In addition to cash in bank, the Company has other current assets mainly composed of accounts receivable, accounts receivable due from a related party, contract assets and amounts due from a related party amounting to approximately S$5,273,727 and S$ 5,424,959 ($3,999,527) as of December 31, 2023 and June 30, 2024. All of them are short-term in nature and can be collected back within the Company’s operating cycles to support the Company’s liquidity needs.

On October 17, 2024, the Company completed its initial public offering (the “IPO”) by issuing 1,500,000 Class A Ordinary Shares at a public offering price of $4.00 per share, for aggregate gross proceeds of approximately $6.0 million. The net proceeds to the Company from the IPO, after deducting the underwriting discount, the underwriters’ fees and expenses, and the Company’s estimated offering expenses, were approximately $5.2 million.

SPRINGVIEW HOLDINGS LTD
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 2 — LIQUIDITY (cont.)

Based on the management’s assessment of the future liquidity and performance of the Company and its available sources of financing, the Company believes that the current cash and cash flows generated from the Company’s future operating and financing activities will be sufficient to meet the cash requirements to fund planned operations and other commitments for at least the next twelve months from the date of the issuance of the consolidated financial statements.

Note 3 — Summary of Significant Accounting Policies

Basis of presentation

The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”).

Principles of consolidation

The consolidated financial statements include the financial statements of the Company and its subsidiary. All inter-company transactions and balances between the Company and its subsidiary have been eliminated upon consolidation. Subsidiaries are those entities in which the Company, directly or indirectly, controls more than one half of the voting power; or has the power to govern the financial and operating policies to appoint or remove the majority of the members of the board of directors, or to cast a majority of votes at the meeting of directors.

Risks and uncertainties

The main operations of the Company are in Singapore. Accordingly, the Company’s business, financial condition, and results of operations may be influenced by political, economic, and legal environments in Singapore, as well as by the general state of the economy in Singapore. The Company’s results may be adversely affected by changes in the political, regulatory and social conditions in Singapore. The Company believes that it is following existing laws and regulations including its organization and structure disclosed in Note 1, such experience may not be indicative of future results.

Use of estimates and assumptions

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the periods presented. On an ongoing basis, management evaluates estimates, including but not limited to, those related to allowance for credit losses, determination of the useful lives of property and equipment, impairment of long-lived assets, right-of-use assets, financing lease liabilities, revenue recognition, allowance for deferred tax assets and contingencies. Management bases its estimates on historical experience and on various other assumptions believed to be reasonable. As a result, management makes judgments regarding the carrying values of the Company’s assets and liabilities that are not readily apparent from other sources. Authoritative pronouncements, historical experience and information, information that is currently available to the Company and assumptions that the Company believes to be reasonable under the circumstances are used as the basis for making estimates and judgements. Actual results may differ from these estimates.

SPRINGVIEW HOLDINGS LTD
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 3 — Summary of Significant Accounting Policies (cont.)

Foreign currency translation

The accompanying consolidated financial statements are presented in the Singapore Dollars (“S$”), which is the reporting currency of the Company. The functional currency of the Company in the Cayman Islands is United States Dollars (“$”), its subsidiaries which are incorporated in British Virgin Islands and Singapore are United States Dollars (“$”) and Singapore Dollars (“S$”) respectively, which are their respective local currencies based on the criteria of ASC 830, “Foreign Currency Matters”.

In the consolidated financial statements of the Company, transactions in currencies other than the functional currency are measured and recorded in the functional currency using the exchange rate in effect at the date of the transaction. At the balance sheet date, monetary assets and liabilities that are denominated in currencies other than the functional currency are translated into the functional currency using the exchange rate at the balance sheet date.

Convenience translation

Translations of amounts in the consolidated balance sheet, consolidated statements of income and comprehensive income and consolidated statements of cash flows from S$ into $ as of and for the six months ended June 30, 2024 are solely for the convenience of the reader and were calculated at the noon buying rate of $1 = S$1.3564, as published in H.10 statistical release of the United States Federal Reserve Board. No representation is made that the S$ amounts could have been, or could be, converted, realized or settled into $ at such rate or at any other rate.

Cash

Cash consists of demand deposit placed with commercial banks, which is unrestricted as to withdrawal and use and have original maturities of less than three months. Cash balances in bank accounts in Singapore with maximum amount of S$75,000 are insured under the Deposit Protection Scheme introduced by the Singapore government. Management believes that the commercial banks are of high credit quality and continually monitors the credit worthiness of these commercial banks.

Accounts receivable, net

On January 1, 2022, the Company adopted ASU 2016-13 Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which replaces the incurred loss methodology with an expected loss methodology that is referred to as the current expected credit loss (“CECL”) methodology, which requires consideration of a broader range of information to estimate credit losses over the lifetime of the asset, including current conditions and reasonable and supportable forecasts in addition to historical loss information, to determine expected credit losses and applies to the measurement of impairment on financial assets measured at amortized cost, which includes trade receivable. Therefore, estimates of expected credit losses on trade receivables over their life will be required to be recorded at inception, based on historical information, current conditions, and reasonable and supportable forecasts.

Under ASU 2016-13, the Company has exposure to credit losses for financial assets, which include accounts receivable. The Company considered various factors, including nature, historical collection experience, the age of the accounts receivable balances, credit quality and specific risk characteristics of its customers, current economic conditions, forward-looking information including economic, regulatory, technological, environmental factors (such as industry prospects, GDP, employment, etc.), reversion period, and qualitative and quantitative adjustments to develop an estimate of credit losses. The Company has adopted the loss rate method to calculate the credit loss and considered the reverent factors of the historical and future conditions of the Company to make reasonable estimation of the risk rate.

Financial assets are presented as net of the allowance for credit losses in the consolidated balance sheets. The measurement of the allowance for credit losses is recognized through current expected credit loss expense. Current expected credit loss expense is included as a component of general and administrative expenses in the consolidated statements of income and comprehensive income. Write-offs are recorded in the period in which the asset is deemed. to be uncollectible. As of December 31, 2023 and June 30, 2024, the allowance for credit losses of accounts receivable was S$30,916 and S$19,735 ($14,550), respectively.

SPRINGVIEW HOLDINGS LTD
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 3 — Summary of Significant Accounting Policies (cont.)

Other assets

Other assets, current and non-current, primarily consist of prepaid expenses, advance to suppliers and deposits for leases and tenders. These amounts bear no interest. Management reviews its prepayments, advances and refundable deposits placed with counterparties on a regular basis to determine if the allowance is adequate and adjusts the allowance when necessary. As of June 30, 2024, no allowance was deemed necessary. Management believes that these counterparties are of high credit quality and continually monitors the credit worthiness of these counterparties.

Deferred offering costs

Deferred offering costs consist of legal, underwriting fees and other costs incurred through the balance sheet date that are directly related to the proposed public offering. These costs, together with the underwriting discounts and commissions. will be charged to additional paid-in capital upon completion of the proposed public offering. Should the proposed public offering prove to be unsuccessful, these deferred costs, as well as additional expenses to be incurred, will be charged to operations. As of December 31, 2023 and June 30, 2024, the Company has incurred S$324,955 and S$559,727 ($412,656) of deferred offering costs, respectively.

Property and equipment, net

Property and equipment are stated at cost, less accumulated depreciation, and impairment loss, if applicable. Depreciation is computed using the straight-line method after consideration of the estimated useful lives. The estimated useful lives are as follows:

The cost and related accumulated depreciation of assets sold or otherwise retired are eliminated from the accounts and any gain or loss is included in the consolidated statements of income and comprehensive income. Expenditures for maintenance and repairs are charged to earnings as incurred, while additions, renewals and betterment, which are expected to extend the useful life of assets, are capitalized. The Company also re-evaluates the periods of depreciation to determine whether subsequent events and circumstances warrant revised estimates of useful lives.

Impairment for long-lived assets

The Company’s long-lived assets with finite lives, including property and equipment, net are reviewed for impairment whenever events or changes in circumstances (such as a significant adverse change to market conditions that will impact the future use of the assets) indicate that the carrying value of an asset may not be recoverable. The Company assesses the recoverability of the assets based on the undiscounted future cash flows the assets are expected to generate and recognizes an impairment loss when estimated undiscounted future cash flows expected to result from the use of the asset plus net proceeds expected from disposition of the asset, if any, are less than the carrying value of the asset. If an impairment is identified, the Company will reduce the carrying amount of the asset to its estimated fair value based on a discounted cash flows approach or, when available and appropriate, to comparable market values. For the six months ended June 30, 2024, no impairment of long-lived assets was recognized.

Fair value measurement

Accounting guidance defines fair value as the exchange price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Company considers the principal or most advantageous market in which it would transact, and it considers assumptions that market participants would use when pricing the asset or liability.

SPRINGVIEW HOLDINGS LTD
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 3 — Summary of Significant Accounting Policies (cont.)

Accounting guidance establishes a three-level fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The three levels of inputs that may be used to measure fair value are as follows:

The Company considers the carrying value of its financial assets and liabilities, which consist of cash, accounts receivable, contract assets and contract liabilities, prepayments and other current assets, amounts due from related parties, accounts payable, lease liabilities — current, income tax payable, other payables and accruals approximate the fair value of the respective assets and liabilities as of December 31, 2023 and June 30, 2024 due to their short-term nature.

Contract assets and contract liabilities

Construction projects with performance obligations recognized over time that have revenue recognized to date in excess of cumulative billings are reported on the Company’s consolidated balance sheets as “contract assets”. Contract retentions, included in contract assets, represent amounts withheld by clients, in accordance with underlying contract terms until certain conditions are met. Provisions for estimated losses of contract assets on uncompleted contracts are made in the period in which such losses are determined. The majority of these amounts are expected to be billed and collected from clients within twelve months and are classified as current assets.

Contract liabilities on uncompleted construction contracts represent the amounts of cash collected from clients, billings to clients on contracts in advance of work performed and revenue recognized and provisions for losses. The majority of these amounts are expected to be earned within twelve months and are classified as current liabilities.

Leases

The Company accounts for leases under ASC 842. The Company determines if an arrangement is a lease at inception. A lease is classified at the inception date as either a finance lease or an operating lease. As the lessee, a lease is a finance lease when the lease meets any of the following criteria at lease commencement:

SPRINGVIEW HOLDINGS LTD
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 3 — Summary of Significant Accounting Policies (cont.)

Leases that do not meet any of the above criteria are accounted for as operating leases.

The Company entered into lease agreements as lessee to lease motor vehicles, office equipment and buildings from third parties.

The Company accounts for those motor vehicle and office equipment leases in accordance with ASC 842. The two primary accounting provisions the Company uses to classify transactions as financing leases or operating leases are (i) the lease transfers ownership of the underlying asset to the lessee by the end of the lease term and (ii) the lease term is for 75% or more of the remaining economic life of the underlying asset unless the commencement date falls within the last 25% of the economic life of the underlying asset. The motor vehicle and office equipment leases contain one of the two terms, and the Company believes that the motor vehicle and office equipment leases should be classified as finance leases.

The Company accounts for those building leases in accordance with ASC 842. The Company believes that the building leases agreements do not contain nor meet any of the five primary accounting provisions the Company uses to classify transactions as financing leases. The building leases are classified as operating leases.

Finance lease assets and operating leases are included in right-of-use (“ROU”) assets, and finance lease liabilities are included in current and non-current finance lease liabilities, while operating lease liabilities are included in current and non-current operating lease liabilities, in the Company’s consolidated balance sheets. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Finance and operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term.

When determining the lease term, the Company includes options to extend or terminate the lease when it is reasonably certain that it will exercise that option. The Company used the rate implicit in the lease, if available, or the incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments.

The Company elected the practical expedients under ASC 842 that does not require the Company to reassess: (1) whether any expired or existing contracts are, or contain, leases, (2) lease classification for any expired or existing leases and (3) initial direct costs for any expired or existing leases. For lease terms of twelve months or fewer, the Company elected not to recognize lease assets and liabilities on its consolidated balance sheets.

The Company reviews the impairment of its ROU assets consistent with the approach applied for its other long-lived assets. The Company reviews the recoverability of its long-lived assets when events or changes in circumstances occur that indicate that the carrying value of the asset may not be recoverable. The assessment of possible impairment is based on its ability to recover the carrying value of the asset from the expected undiscounted future pre-tax cash flows of the related operations. For the six months ended June 30, 2023 and 2024, the Company did not recognize impairment loss on its finance and operating lease ROU assets.

Revenue recognition

The Company adopted Accounting Standards Codification 606, Revenue from Contracts with Customers (“ASC 606”), on January 1, 2021 using the modified retrospective approach. The Company’s accounting for revenue recognition remains substantially unchanged prior to adoption of ASC 606. The effect from the adoption of ASC 606 was not material to the Company’s consolidated financial statements.

The Company recognizes revenue to depict the transfer of promised goods or services (that is, an asset) to customers in an amount that reflects the consideration to which the Company expects to receive in exchange for those services. The following five steps defined under ASC 606 are applied to achieve the core principle of revenue standard:

SPRINGVIEW HOLDINGS LTD
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 3 — Summary of Significant Accounting Policies (cont.)

The Company generates revenue mainly from construction projects with the following major categories of works: (i) new construction, (ii) reconstruction, (iii) A&A, and (iv) other general contracting services, such as renovation and design consultation. For new construction, the existing house will be demolished, and a new house will be rebuilt. Reconstruction works involve replacement of substantial part of the house. For A&A works, minor modifications are made to existing structures within the existing building requirements while other general contracting services include renovation and design consultation services.

The following table shows the Company’s revenue by revenue categories for the periods indicated.

The Company assessed that the four major categories of revenue share the substantially the same characteristics and nature of terms in its contracts with customers and follows the same pattern of transfer of promised services to customers, and thus apply the same revenue recognition policies to all its revenue.

The Company enters into construction contracts with customers that create enforceable rights and obligations and for which it is probable that the Company will collect the consideration to which it will be entitled as services are transferred to the customers. It is standard practice for the Company to have the agreements with the Company’s customers in writing. All the agreements have commercial substance, as each contract with the customer has payment terms specified based upon fulfilment of certain conditions and agreed methods charged on monthly basis. The Company will submit monthly progress claim to its customer, and after the Company receives the interim progress certificate from the customer, the Company will issue a tax invoice to the customer. As the Company’s customers are required to pay at different billing stages over the contract period, such progress payments limit the Company’s exposure to credit risk. The company also reasonably expects that the effects on the financial statements of applying ASC 606 to the portfolio of contracts would not differ materially from applying ASC 606 to the individual contracts within that portfolio.

The Company is responsible for a series of work including but not limited to those stated under the scope of work, which can include the design of the project, obtaining the relevant permits and approvals from authorities, engineering, site clearance, procurement of materials, construction and interior fitting-out/installation as part of the contract. The Company believes these services are not distinct as they are highly interrelated and the contract includes a significant service of integrating the various services into the combined work the customer is contracting for, which is the completed property. The contracts may include retentions paid at the end of the project as a warranty to ensure the Company meets the contract requirements. However, since the customer does not have the option to separately purchase the warranty and there are no additional services to the customer during the retention period, such warranty is not recognized as a separate performance obligation. The Company has concluded that the promises to be delivered on the construction contract would be one single performance obligation, and therefore no allocation of the transaction price is required.

The Company’s contracts with each customer are with fixed price and provide for milestone billings based upon the attainment of specific project objectives to ensure the Company meets the contractual requirements. The contract does not have variable consideration. However, the contract subject to modification in the form of unpriced or pending change orders or claims that either increase or decrease the contract price. Contract modification is accounted for as part of the existing contract as the remaining work is not distinct and form part of a single performance obligation that is partially satisfied at the date of the contract modification. The impact of contract modification has on the contract price and the Company’s measure of progress towards complete satisfaction of the performance obligation is recognized as a cumulative catch-up adjustment to revenue at the date of contract modification.

SPRINGVIEW HOLDINGS LTD
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 3 — Summary of Significant Accounting Policies (cont.)

The Company is not required to assess whether a contract contains a significant financing component if the Company expects, at contract inception, that the period between payment by the customers and the transfer of promised services to the customers will be less than one year. Further, the Company believes that with its monthly progress billings there is no financing component in its contracts. There are no non-cash and payable consideration for any services provided by the Company.

The Company recognizes revenue based on the Company’s actual contract costs incurred to the satisfaction of a performance obligation relative to the total estimated costs for the satisfaction of that performance obligation. This input method faithfully depicts the transfer of value to the customer when the Company is satisfying a performance obligation that includes several interrelated tasks or activities for a combined output that requires the Company to coordinate the work of subcontracts and employees. Contract costs typically include direct labor, subcontract, professional costs, material and indirect costs related to contract performance. Changes in estimated costs to complete these obligations result in adjustments to revenue on a cumulative catch-up basis, which causes the effect of revised estimates to be recognized in the current period. No significant changes to estimated costs have occurred and there is no material impact on its revenue recognition for the years ended December 31, 2023 and for the six months ended June 30, 2023 and 2024.

When the current estimates of the total amount of consideration expected to be received in exchange for transferring promised goods or services to the customer, and contract costs indicate a loss, a provision for the entire loss on the contract is made as soon as the loss become evident. An adjustment is also made to reflect the effects of the customer’s credit risk. The loss on a contract is reported as an additional contract cost (an operating expenses), and not as a reduction of revenue or a non-operating expense. The total loss on contracts is negligible for the years ended December 31, 2023 and for the six months ended June 30, 2023 and 2024.

The Company recognizes revenue over time for all projects throughout the contract period.

Warranty

The Company generally provides limited warranties for work performed under its contracts. At the time a sale is recognized, the Company records estimated future warranty costs under ASC 460. At completion, costs for warranties are estimated and these warranties are not service warranties separately sold by the Company. The estimated claim rates of warranty are based on actual warranty experience or Company’s best estimate. There were no such reserves for the six months ended June 30, 2023 and 2024 because the Company’s historical warranty expenses were immaterial to the Company’s consolidated financial statements.

Cost of revenue

Cost of revenue for construction contracts primarily consisted of material costs, subcontracting costs, direct labor costs, rental of equipment and other expenses incurred in contract performance. These costs are expenses as incurred.

Borrowing costs

All borrowing costs are recognized in interest expenses in the consolidated statement of income and comprehensive income in the period in which they are incurred.

General and administrative expenses

General and administrative expenses consist primarily of motor vehicle running expenses, travelling and entertainment and general administrative expenses such as of staff costs, rental expenses, depreciation, legal and professional fees and other miscellaneous administrative expenses.

SPRINGVIEW HOLDINGS LTD
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 3 — Summary of Significant Accounting Policies (cont.)

Employee benefit

Defined contribution plan

The Company participates in the national pension schemes as defined by the laws of Singapore’s jurisdictions in which it has operations. Contributions to defined contribution pension schemes are recognized as an expense in the period in which the related service is performed.

Government grants

Government grants are compensation for expenses already incurred or for the purpose of giving immediate financial support to the Company. The government evaluates the Company’s eligibility for the grants on a consistent basis, and then makes the payment. Therefore, there are no restrictions on the grants.

Government grants are recognized when received and all the conditions for their receipt have been met and are recorded as part of “other income”. The total grants received from the Singapore Government were S$4,296 and S$2,784 ($2,052) for the year ended December 31, 2023 and for the six months ended June 30, 2024, respectively.

Income taxes

The Company accounts for income taxes under ASC 740. The charge for taxation is based on the results for the fiscal year as adjusted for items, which are non-assessable or disallowed. It is calculated using tax rates that have been enacted or substantively enacted by the balance sheet date.

Deferred taxes are accounted for using the asset and liability method in respect of temporary differences arising from differences between the carrying amount of assets and liabilities in the consolidated financial statements and the corresponding tax basis used in the computation of assessable tax profit. In principle, deferred tax liabilities are recognized for all taxable temporary differences. Deferred tax assets are recognized to the extent that it is probable that taxable profit will be available against which deductible temporary differences can be utilized. Deferred tax is calculated using tax rates that are expected to apply to the period when the asset is realized or the liability is settled. Deferred tax is charged or credited in the income statement, except when it is related to items credited or charged directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Current income taxes are provided for in accordance with the laws of the relevant taxing authorities.

An uncertain tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded. Penalties and interest incurred related to underpayment of income tax are classified as income tax expense in the period incurred. No penalties and interest incurred related to underpayment of income tax for the six months ended June 30, 2024. The Company had no uncertain tax positions as of December 31, 2023 and June 30, 2024. The Company does not expect that its assessment regarding unrecognized tax positions will materially change over the next 12 months.

As of June 30, 2024, the tax years ended December 31, 2020 through 2023 for the Company’s Singapore subsidiary remain open for statutory examination by Singapore tax authorities.

Related parties’ transactions

Parties, which can be a corporation or individual, are considered to be related if the Company has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Companies are also considered to be related if they are subject to common control or common significant influence, such as a family member or relative, shareholder, or a related corporation.

SPRINGVIEW HOLDINGS LTD
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 3 — Summary of Significant Accounting Policies (cont.)

Commitments and contingencies

In the normal course of business, the Company is subject to contingencies, including legal proceedings and claims arising out of the business that relate to a wide range of matters, such as government investigations and tax matters. The Company recognizes its liability for such contingency if it determines it is probable that a loss has occurred, and a reasonable estimate of the loss can be made. The Company may consider many factors in making these assessments including historical and the specific facts and circumstances of each matter. As of December 31, 2023 and June 30, 2024, the Company’s accrued provision for its ongoing litigation matters was S$385,000 and S$385,000 ($291,821) respectively in its consolidated financial statements. For more information see “Note 15 — Commitments and Contingencies”.

Earnings per share

The Company computes earnings per share (“EPS”) in accordance with ASC 260, “Earnings per Share”. ASC 260 requires companies to present basic and diluted EPS. Basic EPS is measured as net income divided by the weighted average number of ordinary shares outstanding for the period. Diluted EPS presents the diluted effect on a per share basis of the potential ordinary shares (e.g., convertible securities, options and warrants) as if they had been converted at the beginning of the periods presented, or issuance date, if later. Potential ordinary shares that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS. As of December 31, 2023 and June 30, 2024, there were no dilutive shares.

Segment reporting

ASC 280, “Segment Reporting”, establishes standards for reporting information about operating segments on a basis consistent with the Company’s internal organizational structure as well as information about geographical areas, business segments and major customers in consolidated financial statements for detailing the Company’s business segments. Based on the criteria established by ASC 280, the Company’s chief operating decision maker (“CODM”) has been identified as the Chief Executive Officer, who reviews consolidated results when making decisions about allocating resources and assessing performance of the Company. As a whole and hence, the Company has only one reportable segment. The Company does not distinguish between markets or segments for the purpose of internal reporting. As the Company’s long-lived assets are located in Singapore, no geographical segments are presented.

Significant Risks

Currency risk

The Company’s operating activities are transacted in S$. Foreign exchange risk may arise from future commercial transactions, and from fluctuations and the degree of volatility of foreign exchange rates between $ and S$.

Concentration and Credit Risk

Financial instruments that potentially subject the Company to the concentration of credit risks consist of cash, accounts receivable, and amounts due from a related party. The maximum exposures of such assets to credit risks are their carrying amounts as of the balance sheet dates. The Company deposits its cash with financial institutions located in Singapore. As of December 31, 2023 and June 30, 2024, S$698,106 and S$153,914 ($113,472)(unaudited) were deposited with financial institutions located in Singapore, respectively. The Deposit Protection Scheme introduced by the Singapore Government insured each depositor at one bank for a maximum amount of S$75,000. The Company believes that no significant credit risk exists as these financial institutions have high credit quality and the Company has not incurred any losses related to such deposits.

For the credit risk related to accounts receivable, the Company performs periodic credit evaluations of its customers’ financial condition and generally does not require collateral. The Company determines its allowance for credit losses for account receivable using an aging schedule. The Company estimates the credit loss rates based on historical loss information, aging of receivables and management’s judgements, including current, reasonable and supportable. forecasted economic conditions compared to the economic conditions using the historical information. The management believes that its contract acceptance, billing and collection policies are adequate in minimizing material credit risk. Application of progress payment of contract works is made on a regular basis. The Company seeks to maintain strict control over its outstanding receivables.

SPRINGVIEW HOLDINGS LTD
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 3 — Summary of Significant Accounting Policies (cont.)

Credit risk on amounts due from a related party is not significant as the timing of payment is controlled by common director and shareholders taking into account cash flow requirements of the Company and there has been no significant increase in the risk of default nor impairment recognized on the amounts due from a related party since initial recognition.

For the six months ended June 30, 2023, four customers accounted for approximately 23%, 18%, 17% and 16% of the Company’s total revenue. For the six months ended June 30, 2024, four customers accounted for approximately 28%, 24%, 18% and 13% of the Company’s total revenue.

As of December 31, 2023, three customers accounted for approximately 12%, 23% and 65% of the total accounts receivable. As of June 30, 2023, one customer accounted for 100% of the total accounts receivable. As of June 30, 2024, three customers accounted for approximately 45%, 44% and 11% of the total accounts receivable.

For the six months ended June 30, 2023 and 2024, the Company did not have significant suppliers or subcontractors accounting for more than 10% of total purchases.

The table below sets out the suppliers or subcontractors who accounted for 10% or more of the Company’s total accounts payable as of December 31, 2023 and June 30, 2024.

Interest rate risk

Fluctuations in market interest rates may negatively affect the Company’s financial condition and results of operations. The Company is exposed to floating interest rate on cash deposit and floating rate borrowings, and risks due to changes in interest rates is not material. The Company has not used any derivative financial instruments to manage interest rate exposure.

Recently issued accounting pronouncements

The Company considers the applicability and impact of all accounting standards updates (“ASUs”). Management periodically reviews new accounting standards that are issued. Under the Jumpstart Our Business Startups Act of 2012, as amended (the “JOBS Act”), the Company meets the definition of an emerging growth company and has elected the extended transition period for complying with new or revised accounting standards, which delays the adoption of these accounting standards until they would apply to private companies.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which updates reportable segment disclosure requirements and is intended to improve disclosures about a public entity’s reportable segments and addresses requests from investors and other allocators of capital for additional, more detailed information about a reportable segment’s expenses. The amendments are effective for fiscal year beginning after December 15, 2023 and for interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. The amendments should be applied retrospectively to all prior periods presented in the financial statements. The Company is currently evaluating this ASU to determine its impact on the Company’s disclosures. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”). ASU 2023-09 enhances the transparency and decision usefulness of the annual income tax disclosures. The two primary enhancements include disaggregating existing income tax disclosures related to the effective tax rate reconciliation and income taxes paid. The standard is effective for fiscal years beginning after December 15, 2024. Early adoption is permitted for annual financial statements that have not yet been issued or made available for issuance. The amendments in ASU 2023-09 should be applied on a prospective basis; however, retrospective application in all prior periods presented in the annual financial statements is permitted. The adoption of ASU 2023-09 is not expected to have a material effect on the Company’s consolidated financial statements.

Except as mentioned above, the Company does not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on the Company’s consolidated balance sheets, statements of income and comprehensive income and statements of cash flows.

SPRINGVIEW HOLDINGS LTD
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 3 — Summary of Significant Accounting Policies (cont.)

Except as mentioned above, the Company does not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on the Company’s consolidated balance sheets, statements of income and comprehensive income and statements of cash flows.

Note 4 — ACCOUNTS RECEIVABLE, NET

Accounts receivable, net consisted of the following:

Movements of allowance for credit losses are as follows:

SPRINGVIEW HOLDINGS LTD
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 5 — CONTRACT ASSETS/(LIABILITIES)

Contract assets consisted of the following:

All contract assets recognized are current with billings expected within the next twelve months.

Movement of the allowance for contract assets were as follows:

Contract liabilities consisted of the following:

Contract liabilities related to contracts are balances due to customers under contracts. These arise if a particular milestone payment exceeds the revenue recognized to date under the cost-to-cost method. All contract liabilities recognized are current with revenue expected to be recognized within the next twelve months.

The movement in contract liabilities is as follows:

SPRINGVIEW HOLDINGS LTD
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 6 — OTHER ASSETS

Other assets — current consisted of the following:

Other assets — non-current consisted of the following:

Short-term deposits include deposits for tenders while long-term deposits primarily include deposits for leases.

Note 7 — PROPERTY AND EQUIPMENT, NET

Property and equipment, net, consist of the following:

Depreciation expenses of owned assets for the year ended December 31, 2023 and for the six months ended June 30, 2024 amounted to S$4,619 and S$2,158 ($1,591), respectively.

No impairment loss had been recognized during the year ended December 31, 2023 and for the six months ended June 30, 2024.

SPRINGVIEW HOLDINGS LTD
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 8 — LEASES

Finance leases as lessee

As of December 31, 2023 and June 30, 2024, the Company has finance leases on its consolidated balance sheets for hire purchase of motor vehicle and lease of office equipment.

The following table shows finance lease liabilities and the associated financial statement line items:

As of December 31, 2023 and June 30, 2024, “Right-of-use assets, net” consisted of the following:

Information related to finance lease activities during the periods are as follows:

SPRINGVIEW HOLDINGS LTD
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 8 — LEASES (cont.)

Future finance lease payments as of June 30, 2024 (unaudited) are detailed as follows:

The following table shows the weighted-average lease terms and discount rates for finance leases:

Operating leases as lessee

As of December 31, 2023 and June 30, 2024, the Company has operating leases on its consolidated balance sheets rentals of leasehold buildings.

The following table shows operating lease liabilities and the associated financial statement line items:

As of December 31, 2023and June 30, 2024, “Right-of-use assets, net” consisted of the following:

SPRINGVIEW HOLDINGS LTD
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 8 — LEASES (cont.)

Information related to operating lease activities during the periods are as follows:

Future operating lease payments as of June 30, 2024 are detailed as follows:

The following table shows the weighted-average lease terms and discount rates for operating leases:

SPRINGVIEW HOLDINGS LTD
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 9 — LOANS AND BORROWINGS

Long-term and short-term loans and borrowings are as follows:

Bank borrowings comprised of the following:

For the year ended December 31, 2023 and the six months ended June 30, 2024, the effective interest rate of the Company’s loans and borrowings ranges from 2.75% to 8.80%, and 4.88% to 8.80%,respectively.

Interest expenses arising from the Company’s loans and borrowings for the year ended December 31, 2023 and the six months ended June 30, 2024 amounted to S$65,085 and S$ 43,257 ($ 31,891 ), respectively.

All loans and borrowings are secured over the joint and several personal guarantees from Ms. Siew Yian Lee and Mr. Heng Kong Chuan, the director and shareholders of the Company.

SPRINGVIEW HOLDINGS LTD
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 9 — LOANS AND BORROWINGS (cont.)

The maturity dates for the Company’s outstanding loans and borrowings as of June 30, 2024 are as follows:

Note 10 — OTHER PAYABLES AND ACCRUALS

The components of other payables and accruals are as follows:

Accrued expenses mainly consisted of staff expenses and professional service fees and costs incurred for operating activities which are yet to bill. Other payables included the provision for legal claims amounting to S$385,000 and S$385,000 ($283,840) as of December 31, 2023 and June 30, 2024 respectively. For more information see “Note 15 — Commitments and Contingencies”.

SPRINGVIEW HOLDINGS LTD
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 11 — OTHER INCOME

Note 12 — INCOME TAXES

Income tax

Cayman Islands

The Company is incorporated in the Cayman Islands and is not subject to tax on income or capital gains under current Cayman Islands law. In addition, upon payments of dividends by the Company entities to their shareholders, no Cayman Islands withholding tax will be imposed. Accordingly, the Company does not accrue for taxes.

British Virgin Islands (“BVI”)

Under the current laws of the BVI, the Company’s subsidiary incorporated in BVI is not subject to tax on income or capital gains. Additionally, upon payments of dividends by the BVI company to its respective shareholders, no BVI withholding tax will be imposed.

Singapore

The Company’s main operating subsidiary is incorporated in Singapore and is subject to income taxes on the taxable income as reported in its statutory financial statements adjusted in accordance with relevant tax laws and regulations of Singapore. The applicable tax rate is 17% in Singapore, with 75% of the first S$10,000 taxable income and 50% of the next S$190,000 taxable income exempted from income tax.

SPRINGVIEW HOLDINGS LTD
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 12 — INCOME TAXES (cont.)

The following table reconciles Singapore statutory rates to the Company’s effective tax rate:

The Company measures deferred tax assets and liabilities based on the difference between the financial statement and tax bases of assets and liabilities at the applicable tax rates. Components of the Company’s deferred tax asset and liability are as follows: