Megachem Limited Annual Report 2015 38 Non-trade amount due to related party, which consist of short term loan from director, decreased by S$0.2 million to S$0.7 million as at 31 December 2015 after partial repayments were made. Other payables decreased by S$0.8 million mainly due to final payments made for the purchase of industrial land in Malaysia. Advance payments from customers, mainly from South America customers, and accrued operating expenses each fell by S$0.6 million. The decrease in advance payments from customers was largely due to reduced sales to that market in FY 2015. Borrowings Strong cash generated from operating activities were utilized to reduce trade borrowings of S$3.5 million and short term bank loans of S$1.1 million. This was offset by new long term loan drawn to finance purchase of land in Malaysia. As a result, total borrowings declined by S$3.6 million or 16.7% to S$18.3 million as at 31 December 2015. Consequentially, our gearing ratio was reduced to 0.43. Net asset value Net asset value per share increased from 31.45 cents as at 31 December 2014 to 31.65 cents as at 31 December 2015 primarily due to total comprehensive income for the current year of S$1.6 million offset by dividend payment to shareholders of S$1.3 million. 3. CASH FLOW Overall cash and cash equivalents increased by S$2.1 million from S$9.0 million as at 31 December 2014 to S$11.1 million as at 31 December 2015. S$7.0 million was generated from operating activities and dividends totaled S$2.3 million were received. These were substantially used to reduce overall short term borrowings of S$4.8 million, finance capital expenditure of S$1.3 million and to meet our dividends obligations of S$1.3 million. Operating and Financial Review
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