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GSH Green & Smart Holdings Plc

2.85
0.00 (0.00%)
28 Mar 2024 - Closed
Delayed by 15 minutes
Share Name Share Symbol Market Type Share ISIN Share Description
Green & Smart Holdings Plc LSE:GSH London Ordinary Share JE00BYTQ7945 ORD NPV
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  0.00 0.00% 2.85 2.70 3.00 0.00 00:00:00
Industry Sector Turnover Profit EPS - Basic PE Ratio Market Cap
0 0 N/A 0

Green & Smart Holdings plc Half Year Results (8150I)

22/06/2017 7:01am

UK Regulatory


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RNS Number : 8150I

Green & Smart Holdings plc

22 June 2017

The information contained within this announcement is deemed by the Group to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement via a Regulatory Information Service ("RIS"), this inside information is now considered to be in the public domain.

22 June 2017

Green & Smart Holdings plc

("Green & Smart" or "the Group")

Half Year Results for the Six Months ended 31 March 2017

Green & Smart Holdings plc (AIM: GSH), a renewable energy company generating power from biogas captured through the treatment of palm oil mill effluent ("POME") in Malaysia, announces its interim results for the six months ended 31 March 2017.

Financial Summary*

   --       Revenue increased 18% to RM25.8m (H1 2016: RM21.8m) 
   --       Gross profit was RM6.9m (H1 2016: RM6.7m) 
   --       Profit before tax was RM3.8m (H1 2016: RM4.8m) 

-- Raised RM6m through the issue of new ordinary shares to Malaysian Technology Development Corporation Sdn Bhd

-- Cash, cash equivalents and receivables at 31 March 2017 were RM76.22m (30 September 2016: RM58.65m)

-- Post period, arranged a 12 month debt facility of c. RM1.4m and raised up to GBP0.6m (c. RM2.9m) by way of a private placement

Operational Summary

Green & Smart Projects

-- Received a certificate of initial operation date ("IOD") from the authorities for first fully-owned biogas power plant at Kahang and, post period, received the formal certificate of commercial operation date ("COD"), which allows the Group to sell power to the national utility at the full tariff rate

-- The Group's second wholly-owned biogas power plant, the 2.0MW Malpom plant, has now been commissioned following completion of construction and installation of the biogas system

Megagreen Energy ("MGE") & Concord Green Energy ("CGE") Projects

-- Completed construction of two biogas power plants (Labis, Johor and Maran, Pahang) owned by Megagreen Energy Sdn Bhd under Phase 2 MGE contracts

-- Work commenced on four CGE greenfield biogas-based power generation plants being constructed within the sites of four specified palm oil mills owned by Felda Palm Industries Sdn Bhd

-- Green & Smart remains in discussions with CGE in relation to its pipeline of brownfield sites

Mr. Saravanan Rasaratnam, Chief Executive Officer of Green & Smart, said:

"During the first half of the year, the Group continued to execute on its strategy to generate power from biogas captured through the treatment of POME in Malaysia. The Group advanced its projects under EPCC contracts resulting in higher revenues than in the equivalent period last year. Our first fully-owned biogas power plant, Kahang, is now able to sell power to the national utility at the full tariff rate and our second fully-owned plant, Malpom, has now been commissioned.

"We continue to make progress with the development of our pipeline of wholly-owned and associated projects. Green & Smart anticipates the completion of more EPCC contracts in the second half and our fully-owned biogas power plants will continue to provide power to the grid. We remain one of the few fully-integrated providers and operators of biogas plants in Malaysia at a time when government regulation requires all palm oil mill operators to install biogas plants to capture greenhouse gases in the form of methane that would otherwise be released into the atmosphere. As a result, the Board looks to the future with confidence."

* The financial information in this announcement for the comparative period for the six months ended 31 March 2016 covers an accounting period prior to the listing of the Group on AIM and completion of the Group reorganisation, on 6 May 2016, comprising the acquisition by Green & Smart Holdings plc of Green & Smart Sdn Bhd, Green & Smart Ventures Sdn Bhd and 51% of the share capital of Our Energy Group (M) Sdn Bhd to form the Green & Smart group of companies as it is currently constituted and the admission to trading on AIM of the share capital of Green & Smart Holdings plc.

Enquiries

 
 Green & Smart Holdings plc 
 Saravanan Rasaratnam, Chief Executive 
  Officer 
  Navindran Balakrishnan, Chief Operations 
  Officer                                     +603 2095 0024 
 
 Cantor Fitzgerald Europe (Nominated 
  Adviser and Broker) 
 Andrew Craig, Richard Salmond                +44 20 7894 7000 
 
 Luther Pendragon Ltd 
 Harry Chathli, Claire Norbury, 
  Alexis Gore                                 +44 20 7618 9100 
 

Operational Summary

Green & Smart designs and builds biogas power generation plants. The plants capture greenhouse gasses from palm oil mill waste in Malaysia, which in turn is converted to electricity typically to be sold under 16-year electricity Feed-in-Tariffs ("FiT"). The Group works with major crude palm oil producers, including the world's largest producer Felda Global Ventures Holdings Berhad, and operates two business models: build, own, operate ("BOO") and that of engineering, procurement, construction & commissioning ("EPCC") contractor for third parties.

Fully-owned Plants - BOO

Green & Smart has established a pipeline of projects that it will build, own and operate. Through the BOO structure, the Group builds, owns and operates biogas power plants situated on land within or in close proximity to palm oil mills. As the mill operators generate palm oil mill effluent ("POME") from their palm processing mills on a continuous basis, Green & Smart's biogas operations are built to ensure that they can treat the POME and capture methane from which to generate electricity also on a continuous basis. Under this model, the Group contracts with mill owners to finance and build plants for the generation and sale of electricity to electric utilities - Tenaga Nasional Berhad ("TNB"), a government-controlled company and largest electric utility in Malaysia, or Sabah Electricity Sdn Bhd ("SESB"), the local utility in the Sabah state of Malaysia - under the FiT regime using waste from the mills made available by the mill owners.

During the period, the Group's first fully-owned plant, the 2.0MW Kahang biogas plant located in the state of Johor, received a certificate of initial operation date ("IOD") from the authorities and, post period, it received the formal certificate of commercial operation date ("COD"). As a result, the Group is now selling power generated by the Kahang plant to the national utility at the full tariff rate.

At the Group's second fully-owned plant, the 2.0MW Malpom plant located in Nibong Tebal, Penang, Green & Smart completed construction and installation of the biogas system, and commenced commissioning. Post period, as announced today, the Group completed the commissioning of the plant, and live testing of power generation from the plant will now be undertaken by the Sustainable Energy Development Authority of Malaysian ("SEDA") and TNB. Green & Smart will commence recording revenues as power generated for transmission over the national grid during the testing period will be sold to TNB. The Group anticipates testing to be completed by the end of July 2017 when the plant will become fully operational at headline capacity.

Also during the period, the Group advanced the Minyak (2.7MW), Liziz (2.8MW) and Milik Mestika (2.9MW) projects, including expanding the palm oil mill effluent capture facilities.

In addition, work is scheduled to commence shortly on the Dupont (1.0MMW) and Veetar (2.0MW) plants.

EPCC & Associated Companies

The Associated Companies have been established to own biogas power plants at palm oil mills owned by large palm oil businesses under a build-partially own-operate structure. Through its equity stakes in the Associated Companies, the Group has an ongoing interest in the performance of the plants in addition to revenue from the initial EPCC contracts for building the biogas power plants to be owned by these Associated Companies.

Megagreen Energy

During the period, the Group completed the construction, under EPCC contract with Megagreen, of plants at Labis (1.0MW) in Johor and Maran (1.0MW) in Pahang ("MGE Phase 2 projects").

Green & Smart understands that Megagreen continued to progress application for the IODs for the three plants that the Group completed in the prior financial year - at Kilang Sawit Nasaruddin (1.0MW) in Bota, Perak; Kilang Sawit Sg Melikai (1.0MW) in Mersing, Johor; and Kilang Sawit Seberang (2.0MW), Perak ("MGE Phase 1 projects") - which will start to generate revenue when the IOD is received.

MGE's five FiT-approved biogas power plants, which are installed alongside mills owned by FELCRA Berhad, have a total installed capacity of 6.0MW. The Group will receive revenue from the sale of power generated by these plants as a result of its equity stake in MGE.

Concord Green Energy

The Group commenced work, under its EPCC contract with CGE, on four greenfield biogas-based power generation plants to be constructed within the sites of four specified palm oil mills owned by Felda Palm Industries Sdn Bhd. The Group expects to complete the CGE plants by year-end 2017 with the process of applying for IOD and COD on these plants by CGE to follow.

Green & Smart remains in discussions with CGE in relation to its pipeline of brownfield sites and will provide further updates as appropriate.

Management Titles

The Board of Green & Smart has resolved to amend the job titles of the key management personnel to bring the descriptions in line with industry norms and to better reflect the roles currently being performed by the individuals. Henceforth, Mr. Saravanan Rasaratnam (formerly Group Managing Director) has assumed the title of Chief Executive Officer; Mr. Navindran Balakrishnan (formerly Group Executive Director) has assumed the title of Chief Operations Officer; Mr. Sivadas Kumar (formerly Chief Executive Officer) has assumed the title of Chief Financial Officer; and Mr. Thannimalai Renganathan (formerly Chief Operations Officer) has assumed the title of Chief Technical Officer.

Dividend Policy

To date, the earnings of the Group have been reinvested in the business to fund the Green & Smart's ongoing growth strategy. However, as a result of its mature pipeline of projects, anticipated cash generation from its fully-owned plants connected to the grid and completion of further EPCC contracts, the directors of Green & Smart (the "Directors") believe that it will be commercially prudent for the Group to consider the implementation of a progressive dividend policy targeting a maiden dividend for the financial year ending 30 September 2018.

Financial Review

Revenues for the six months ended 31 March 2017 increased by 18% to RM25.8m compared with RM21.8m for the first half of the 2016 financial year. The revenue recognised for the six months ended 31 March 2017 was generated primarily through the provision of EPCC services to its Associated Companies, but the Group also derived revenue from the sale of power from its fully-owned Kahang biogas power plant.

Operating profit was RM3.8m compared with RM4.8m for the first half of the prior year and, due to the Group's BioNexus Status that exempts it from tax, profit before tax was RM3.8m (H1 2016: RM4.8m) and profit after tax was also RM3.8m.

On a consolidated level, the Group's earnings per share for the six month period ended 31 March 2017 was RM0.013, based on the weighted number of ordinary shares (H1 2016: RM0.017) (see Note 11 to the financial statements).

In December 2016, the Group received a further investment of RM6m (c. GBP1.14m at RM5.25 to 1GBP conversion rate) through the issue of new ordinary shares to the Malaysian Technology Development Corporation Sdn Bhd, a company wholly-owned by the sovereign wealth fund of the Government of Malaysia that was established to promote and support the commercialisation of technology in Malaysia. Cash, cash equivalents and receivables at 31 March 2017 were RM76.22m (30 September 2016: RM58.65m).

At 31 March 2017, the Group had debtors of RM75.1m in the form of its partners, MGE and CGE. As previously stated, the Directors of Green & Smart are actively monitoring the MGE and CGE receivables. Further payments of RM5.5m were received from these parties during the period and a further RM0.7m was received post the period end. As a shareholder in both MGE and CGE, the Directors of Green & Smart are monitoring the position closely including the recent external funding that each of these groups have been awarded and entered into, aside from their existing cash resources, which totals RM84.2m from Malaysian government and established private financial institutional sources, to be drawn down in 2017 and 2018.

Having reviewed the third-party funding arrangements now in place for both MGE and CGE and having received assurances from the management of MGE in relation to the timing of payments, the Directors consider the amounts owing to be recoverable in full and that the outstanding receivable position will be progressively rectified.

Post period, the Group entered into a 12-month loan of approximately RM1.4m. Additionally, the Group successfully raised up to GBP552,759 by way of a private placement of 6,141,772 shares.

Outlook

The Group continues to make progress with the development of its pipeline of wholly-owned and associated projects. Green & Smart anticipates completion of more EPCC contracts in the second half and the Group's fully-owned biogas power plants will continue to provide power to the grid.

The Group has a significant market share of contracts awarded to a biogas-to-power company generating power from biogas captured through the treatment of palm oil mill effluent in Malaysia to date. The maintenance of this leading position is very much dependent on the availability of adequate funding and financing and accordingly the Group is focused on securing long-term financing facilities from local finance providers that are becoming increasingly familiar with both Green & Smart and also the generation of biogas from POME to generate electricity. The Group continues to be selective in seeking to win both BOO and EPCC contracts in Malaysia that meet with its strict operational and financial evaluation criteria on a project-by-project basis.

The Group is also evaluating additional opportunities in neighbouring Indonesia. The Directors estimate there are approximately 1,000 palm oil processing mills in Indonesia and the Directors will apply their normal operational and financial selection criteria in terms of the partners with whom they will seek to contract for biogas plants. Any projects entered into by Green & Smart in Indonesia are expected to be denominated in US$ and works would be sub-contracted locally with established engineering firms. Indonesia represents a valuable and additive market opportunity to the Group's main area of focus in Malaysia.

The aforementioned drivers provide the Board with confidence in delivering sustained, long-term growth and shareholder value. The Directors believe that, with recurring revenue streams and a strong market position, it will be commercially prudent for the Group to consider the implementation of a progressive dividend policy targeting a maiden dividend for the financial year ending 30 September 2018.

GREEN AND SMART HOLDINGS PLC

CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

For the six months ended 31 March

 
                                                                          Audited 
                                                                             Year 
                                            Unaudited     Unaudited         ended 
                                          31-Mar-2017   31-Mar-2016   30-Sep-2016 
                                 Note          RM'000        RM'000        RM'000 
 ASSETS 
 NON-CURRENT ASSETS 
 Intangible assets                                927           982           954 
 Investment in associates                          26           400            26 
 Property, plant and 
  equipment                       14           32,966        17,332        27,700 
 Total non-current 
  assets                                       33,919        18,714        28,680 
                                         ------------  ------------  ------------ 
 
 CURRENT ASSETS 
 Trade and other receivables                    2,638        27,492         1,071 
 Amount owing by contract 
  customers                       15              551             -           551 
 Amount owing by related 
  parties                         16           75,707             -        55,422 
 Cash and cash equivalents        12              515         5,183         2,153 
 Total current assets                          79,411        32,675        59,197 
                                         ------------  ------------  ------------ 
 
 Total assets                                 113,330        51,389        87,877 
                                         ============  ============  ============ 
 
 EQUITY 
 Stated capital                   13           41,142         9,000        35,142 
 Foreign translation 
  reserve                                     (3,169)             -       (2,657) 
 Retained profit                               16,826         8,849        13,007 
 Merger reserve                               (4,028)             -       (4,028) 
                                         ------------  ------------  ------------ 
 Total shareholders' 
  equity                                       50,771        17,849        41,464 
 Non-controlling interests                         47                          47 
 Total equity                                  50,818        17,849        41,511 
                                         ------------  ------------  ------------ 
 
 CURRENT LIABILITIES 
 Trade and other payables         17           50,420        21,045        34,676 
 Amount owing to contract 
  customers                          15           150         2,553           150 
 Short-term borrowings                          1,941         9,397         1,930 
 Total current liabilities                     52,511        32,995        36,756 
                                         ------------  ------------  ------------ 
 
 NON-CURRENT LIABILITY 
 Government grant income                          130             -           136 
 Long term borrowings                           8,508             -         8,578 
 Amount owing to directors                      1,363           545           896 
 Total non-current 
  liabilities                                  10,001           545         9,610 
                                         ------------  ------------  ------------ 
 
 Total liabilities                             62,512        33,540        46,366 
                                         ------------  ------------  ------------ 
 
 Total liabilities 
  and equity                                  113,330        51,389        87,877 
                                         ============  ============  ============ 
 

GREEN AND SMART HOLDINGS PLC

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

For the six months ended 31 March

 
                                                                    Audited 
                                                                       Year 
                                                                      ended 
                                      31-Mar-2017   31-Mar-2016   30-Sep-16 
                               Note        RM'000        RM'000      RM'000 
 
 Revenue                                   25,797        21,780      67,375 
 Cost of sales                           (18,920)      (15,108)    (50,318) 
                                     ------------  ------------  ---------- 
 Gross profit                               6,877         6,672      17,057 
 
 Other income                                  20            12         197 
 Less: operating expenses 
 Listing costs                                  -             -     (1,936) 
 Administrative expenses                  (3,058)       (1,863)     (5,070) 
 Other expenses                               (9)             -       (119) 
                                     ------------  ------------  ---------- 
                                          (3,067)       (1,863)     (7,125) 
 
 Operating profit                           3,830         4,821      10,129 
 
 Finance cost                                (11)             -        (45) 
 Share of result in 
  associate undertakings, 
  net of tax                                    -             -       (156) 
 Profit before taxation                     3,819         4,821       9,928 
 
 Income tax expense             10              -             -           - 
                                     ------------  ------------  ---------- 
 Profit for the year 
  after tax                                 3,819         4,821       9,928 
                                     ------------  ------------  ---------- 
 
 Other comprehensive 
  income 
 Items that may be 
  reclassified subsequently 
  to profit or loss: 
 Exchange difference 
  on translation of 
  foreign operations                        (512)             -     (2,657) 
 Total comprehensive 
  income                                    3,307         4,821       7,271 
                                     ============  ============  ========== 
 
 Profit for the year 
  attributable to:- 
 - Owners of the company                    3,819         4,821       9,929 
 - Non-controlling 
  interest                                      -             -         (1) 
                                            3,819         4,821       9,928 
                                     ============  ============  ========== 
 
 Total comprehensive 
  income attributable 
  to:- 
 - Owners of the company                    3,307         4,821       7,272 
 - Non-controlling 
  interest                                      -             -         (1) 
                                            3,307         4,821       7,271 
                                     ============  ============  ========== 
 Earnings per share: 
 Basic (RM, cents)              11           1.35          1.74        3.59 
 Diluted (RM, cents)            11           1.34          1.74        3.58 
                                     ============  ============  ========== 
 

GREEN AND SMART HOLDINGS PLC

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the six months ended 31 March

 
 
                     Note 
                                                                             Attributable 
                                             Foreign                            to owners 
                               Stated    translation     Merger   Retained         of the   Non-controlling      Total 
                              Capital        reserve    reserve    Profits        company          interest     equity 
                               RM'000         RM'000     RM'000     RM'000         RM'000            RM'000     RM'000 
 
 Balance as at 1 
  October 2015                      -              -      5,041      3,078          8,119                48      8,167 
 Profit for the year                -              -          -      9,929          9,929               (1)      9,928 
 Other 
 comprehensive 
 income 
 Translation of foreign 
  operations                        -        (2,657)          -          -        (2,657)                 -    (2,657) 
                                                                 ---------                 ---------------- 
 Total comprehensive 
  income                            -        (2,657)      5,041     13,007         15,391                47     15,438 
                            ---------  -------------  ---------  ---------  -------------  ----------------  --------- 
 
 Transactions with 
  owners 
 Issuance of shares 
  on group reconstruction      13,069              -    (9,069)          -          4,000                        4,000 
 Issuance of placing 
  shares                       22,073              -          -          -         22,073                 -     22,073 
 Balance at 30 September 
  2016                         35,142        (2,657)    (4,028)     13,007         41,464                47     41,511 
                            ---------  -------------  ---------  ---------  -------------  ----------------  --------- 
 
 Profit for the year                -              -          -      3,819          3,819                 -      3,819 
 Other 
 comprehensive 
 income 
 Translation of foreign 
  operations                        -          (512)          -          -          (512)                 -      (512) 
                                       ------------- 
 Total comprehensive 
  income                            -          (512)          -      3,819          3,307                 -      3,307 
                            ---------  -------------  ---------  ---------  -------------  ----------------  --------- 
 
 Transactions with 
  owners 
 Issuance of placing 
  shares                        6,000              -          -          -          6,000                        6,000 
 Balance at 31 March 
  2017                         41,142        (3,169)    (4,028)     16,826         50,771                47     50,818 
                            ---------  -------------  ---------  ---------  -------------  ----------------  --------- 
 
 
 GREEN AND SMART HOLDINGS PLC 
  CONDENSED CONSOLIDATED STATEMENT OF CASH FLOW 
  For the six months ended 31 March 
                                            Unaudited     Unaudited      Audited 
                                                                            Year 
                                                                           ended 
                                  Note    31-Mar-2017   31-Mar-2016    30-Sep-16 
                                               RM'000        RM'000       RM'000 
 CASH FLOW FROM OPERATING 
  ACTIVITIES 
 Profit before taxation                         3,819         4,821        9,928 
 Adjustments for : 
 Amortisation of intangible 
  assets                                           27            27           55 
 Depreciation of plant 
  and equipment                                   383            21          147 
 Government grant income                          (6)           (6)         (13) 
 Share of loss of associate                         -             -          156 
 Interest expenses                                  8             -            9 
 Cash flow from operating 
  activities before working 
  capital changes                               4,231         4,863       10,282 
 Decrease/(increase) in 
  trade and other receivables                 (1,567)      (15,586)        1,180 
 Increase in trade and 
  other payables                               15,757         7,152       14,219 
 (Increase)/decrease in 
  amount owing by/to contract 
  customers                                         -       (5,548)      (2,072) 
 (Increase)/decrease in 
  amount owing by related 
  parties                                    (20,285)             -     (43,215) 
                                         ------------  ------------  ----------- 
 
 Cash flow used in/(from) 
  operating activities                        (1,864)       (9,119)     (19,606) 
 Interest paid                                    (8)             -          (9) 
 NET CASH FLOW USED IN/ 
  (FROM) OPERATING ACTIVITIES                 (1,872)       (9,119)     (19,615) 
                                         ------------  ------------  ----------- 
 
 CASH FLOW FOR INVESTING 
  ACTIVITIES 
 Purchase of plant and 
  equipment                                   (5,375)         (214)     (15,260) 
 NET CASH FLOW USED IN 
  INVESTING ACTIVITIES                        (5,375)         (214)     (15,260) 
                                         ------------  ------------  ----------- 
 
 CASH FLOW FOR FINANCING 
  ACTIVITIES 
 Issuance of new ordinary 
  shares                                        6,000         4,000       19,416 
 Issuance of redeemable 
  convertible preference 
  shares                                                          -        4,000 
 Prepaid listing expenses                           -       (2,549)            - 
 Drawdown of term loans                             -           902        1,921 
 Repayment of term loans                        (391)             -        (507) 
 NET CASH FLOW FROM FINANCING 
  ACTIVITIES                                    5,609         2,353       24,830 
                                         ------------  ------------  ----------- 
 
 Net (decrease)/increase 
  in cash and cash equivalents                (1,638)       (6,980)     (10,045) 
 Cash and cash equivalents 
  at the beginning of the 
  year                                          2,153        12,163       12,198 
 Cash and cash equivalents 
  at the end of the year                          515         5,183        2,153 
                                         ------------  ------------  ----------- 
 

GREEN AND SMART HOLDINGS PLC

NOTES TO THE FINANCIAL STATEMENT

For the six months ended 31 March

   1.             GENERAL INFORMATION 

Green & Smart Holdings Plc was incorporated as a public limited company in Jersey with its registered office at 12 Castle Street, St. Helier, Jersey JE2 3RT, Channel Islands. The Company has its primary listing on the AIM market, London Stock Exchange.

Green & Smart Sdn. Bhd. is a company involved in research and development, provision of professional engineering consultancy and process design services in the area of industrial biotechnology, pollution control and renewable energy; and engineering, procurement and construction of various waste treatment plants/systems; and development, commercialisation, operation and maintenance of renewable energy plants. The Company was incorporated and domiciled in Malaysia.

The financial information is presented in RM (Ringgit Malaysia) which is the currency of the primary economic environment in which the Group operates. All values are rounded to the nearest thousand ringgit ("RM'000") except where otherwise indicated.

   2.             basis of preparation 

The consolidated financial information for the six months period ended 31 March 2017 and 31 March 2016 has been prepared in accordance with IAS 34, Interim Financial Reporting. The consolidated financial information is unaudited and does not constitute statutory financial statements. The interim financial information has been prepared on a historical cost basis, and fair value method will be used if it is relevant.

The principal accounting policies used in preparing the interim results are the same as those applied in the Group's financial statements as at and for the year ended 30 September 2016, which have been prepared in accordance with International Financial Reporting Standards as adopted by the EU ("IFRS") issued by the International Accounting Standards Board ("IASB"), including related interpretations issued by the International Financial Reporting Interpretations Committee ("IFRIC"). The auditors' report on those accounts was unqualified but did not contain an emphasis of matters paragraph in respect of the recoverability of amounts owing by related parties and going concern.

A copy of the audited consolidated financial statements for the year ended 30 September 2016 is available on the Company's website.

The interim report for the six months ended 31 March 2017 was approved by the Directors on 21 June 2017.

Going Concern

The interim financial information has been prepared on the going concern basis, which assumes that the Group will continue to be able to meet its liabilities as they fall due for the foreseeable future. At 31 March 2017, the Group was owed RM75.1m by MGE and CGE. As previously stated, the directors of Green & Smart are actively monitoring the MGE and CGE receivables. The Group is a shareholder in each of MGE and CGE and exercises significant influence over those entities. During the period, the Group received RM5.5m from these parties. Post period end, the Group has received a further RM0.7m.

As a shareholder in both MGE and CGE, the Directors of Green & Smart are monitoring the position closely including the recent external funding that each of these groups have been awarded and entered into, aside from their existing cash resources, which totals RM84.2m from Malaysian government and established private financial institutional sources, to be drawn down in 2017 and 2018.

Having reviewed the third-party funding arrangements now in place for both MGE and CGE and having received assurances from the management of MGE in relation to the timing of payments, the directors consider the amounts owing to be recoverable in full and that the outstanding receivable position will be progressively rectified.

   3.             SEASONAL OR CYCLICAL FACTORS 

There are no seasonal factors that materially affect the operations of any company in the Group.

   4.             ITEMS OF AN UNUSUAL NATURE 

There were no other unusual items affecting assets, liabilities, equity, net income or cash flows due to their nature, size or incidence for the financial period ended 31 March 2017.

   5.             MATERIAL CHANGES IN ACCOUNTING ESTIMATES 

The preparation of unaudited interim financial report requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expenses for the current and its corresponding financial period under review. Actual results may differ from these estimates.

In preparing the unaudited interim financial report, the significant judgements made by the management in applying the Group's accounting policies and the sources of estimates uncertainty were consistent as those applied to the 2016 Audited Financial Statements.

There were no changes in estimates of amounts of the Group that may have a material effect on financial period ended 31 March 2017.

   6.             DIVIDS 

No interim dividend was recommended by the directors during the financial period under review.

   7.             GEOGRAPHICAL SEGMENTS 

Operating segments are prepared in a manner consistent with the internal reporting provided to the management by its chief operating decision maker in order to allocate resources to segments and to assess their performance. Currently Green & Smart Sdn Bhd operates under one operating segment providing consulting and contract services to customers in the renewable energy sector and those requiring waste water treatment.

Information on geographical segments is not presented as Green & Smart Sdn Bhd operates wholly in Malaysia where all of its assets and liabilities are located.

   8.             SUBSEQUENT EVENTS 

Post period, the Group entered into a 12-month loan of approximately RM1.4m. Additionally, the Group successfully raised GBP552,759 by way of a private placement of 6,141,772 shares.

   9.             CHANGES IN CONTINGENT LIABILITIES AND CONTINGENT ASSETS 

There were no major contingent liabilities and contingent assets that had arisen during the interim financial period as at 31 March 2017.

   10.          TAXATION 

Green & Smart Sdn Bhd, was granted BioNexus Status by the Government Of Malaysia, resulting in its being entitled to tax exemption on its statutory business income derived from approved activities over five consecutive years of assessment commencing from the first year in which it generates statutory income from relevant approved activities. Except for this, the average corporate tax rate for the Subsidiaries is 24%.

   11.          EARNINGS PER SHARE 

The financial information represents the financial information of Green & Smart Holdings plc. Following the group reorganisation, whereby Green & Smart Holdings Plc became the new parent company of the Group. Accordingly, earnings per share has been included based on the relevant number of shares in Green & Smart Holdings Plc following the group reorganisation. The calculation of earnings per share is based on the following earnings and number of shares:

 
                                                                  Audited 
                                                                     Year 
                                Unaudited       Unaudited           ended 
                                31-Mar-17       31-Mar-16       30-Sep-16 
 
 Profit after taxation 
  (RM' 000)                         3,819           4,821           9,929 
 
 Weighted average shares 
  in issue for basic 
  earnings per share          282,875,148     276,666,667     276,666,667 
 
 Adjustments for: 
 Warrant instruments            1,383,333               -         536,702 
 Weighted average shares 
  in issue for diluted 
  earnings per share          284,258,481     276,666,667     277,203,369 
 
 Basic earnings per 
  share (RM - cent)                  1.35            1.74            3.59 
                           --------------  --------------  -------------- 
 
 Diluted earnings per 
  share (RM - cent)                  1.34            1.74            3.58 
                           --------------  --------------  -------------- 
 
 

Diluted EPS amounts are calculated by dividing the profit or loss for the period/year attributable to equity holders of the Group by the weighted average number of ordinary shares outstanding during the period/year plus the weighted average number of ordinary shares that would be issued on conversion of all the dilutive potential ordinary shares into ordinary shares.

In the six months ended 31 March 2016, a proforma earnings per share figure was presented based on the number of shares in issue on admission to AIM. Weighted average shares in issue for the year ended 30 September 2016 has been re-presented to show the information on a comparable basis.

   12.          CASH AND BANK BALANCES 

For the purpose of the statements of cash flows, cash and cash equivalents comprise the following: -

 
                                                Audited 
                     Unaudited   Unaudited   Year ended 
                     31-Mar-17   31-Mar-16    30-Sep-16 
                       RM' 000     RM' 000      RM' 000 
 Deposits with 
  licensed banks             -           -            - 
 Cash and bank 
  balances                 515       5,183        2,153 
 
 
 Cash and cash 
  equivalents              515       5,183        2,153 
                   -----------  ----------  ----------- 
 
   13.          STATED CAPITAL 
 
 
                                  31 March 2017 
                                  No. of   RM'000 
                                  shares 
 Issued and Fully Paid-Up 
 
 As at 1 October 2016        276,666,667   35,142 
 Issue of new shares          10,761,367    6,000 
 
 
 31 March 2017               287,428,034   41,142 
 
 

On 16 December 2016, pursuant to the execution of an Investment Agreement dated the same day, MTDC subscribed for an addition 6,000,000 units of Redeemable Convertible Preference Shares of RM0.10 each at an issue price of RM1.00 each in Green & Smart Sdn Bhd. This thus resulted in the creation of a Share Premium of RM5.4 million in the books of Green & Smart Sdn Bhd

MTDC initially acquired 6,000,000 redeemable convertible preference shares of RM0.10 each at an issue price of RM1.00 each ("RCPS") in a wholly-owned subsidiary of the Company, Green & Smart Sdn Bhd. Following the issue, the RCPS were converted into 10,761,367 new ordinary shares in the Company pursuant to a share swap agreement also dated 19 December 2016 entered into between the Company, Green & Smart Ventures Sdn Bhd and MTDC.

The Company had issued 10,761,367 new ordinary shares ("Subscription Shares") at a subscription price of 10.62 pence per Subscription Share (the "Subscription"), being the closing price on 16 December 2016. On admission, the Subscription Shares ranked pari passu in all respects with the existing ordinary shares. Following admission, MTDC holds 19,476,367 shares in the Company, amounting to 6.78% of the enlarged issued share capital of the Company.

   14.          PROPERTY, PLANT AND EQUIPMENT 
 
 
 
                                                                Capital 
                                                                   Work 
                        Furniture                    Office          in   Industrial      Motor 
                       & Fittings   Renovation    Equipment    Progress     Building    Vehicle     Total 
                           RM'000       RM'000       RM'000      RM'000       RM'000     RM'000    RM'000 
 At Cost 
 At 1 October 
  2015                         75          124           25      11,542            -          -    11,766 
 Addition                                  141           72       5,391                             5,604 
 At 31 March 
  2016                         75          265           97      16,933            -          -    17,370 
                     ------------  -----------  -----------  ----------  -----------  ---------  -------- 
 Less: Accumulated 
  Depreciation 
 At 1 October 
  2015                          3            4            9           -            -                   16 
 Addition                       5           10            7                                            22 
 At 31 March 
  2016                          8           14           16           -            -          -        38 
                     ------------  -----------  -----------  ----------  -----------  ---------  -------- 
 Carrying Amount 
 At 31 March 
  2016                         67          251           81      16,933            -          -    17,332 
                     ------------  -----------  -----------  ----------  -----------  ---------  -------- 
 
 
 
 
                                                                Capital 
                                                                   Work 
                        Furniture                    Office          in   Industrial      Motor 
                       & Fittings   Renovation    Equipment    Progress     Building    Vehicle     Total 
                           RM'000       RM'000       RM'000      RM'000       RM'000     RM'000    RM'000 
 At Cost 
 At 1 October 
  2015                         75          124           25      11,542            -          -    11,766 
 Addition                      88          332          116      14,829            -        732    16,097 
 At 30 September 
  2016                        163          456          141      26,371            -        732    27,863 
                     ------------  -----------  -----------  ----------  -----------  ---------  -------- 
 Less: Accumulated 
  Depreciation 
 At 1 October 
  2015                          3            4            9           -            -                   16 
 Addition                      12           31           17           -            -         87       147 
 At 30 September 
  2016                         15           35           26           -            -         87       163 
                     ------------  -----------  -----------  ----------  -----------  ---------  -------- 
 Carrying Amount 
 at 30 September 
  2016                        148          421          115      26,371            -        645    27,700 
                     ------------  -----------  -----------  ----------  -----------  ---------  -------- 
 
 
                                                                Capital 
                                                                   Work 
                        Furniture                    Office          in   Industrial      Motor 
                       & Fittings   Renovation    Equipment    Progress     Building    Vehicle     Total 
                           RM'000       RM'000       RM'000      RM'000       RM'000     RM'000    RM'000 
 At Cost 
 At 1 October 
  2016                        163          456          141      26,371            -        732    27,863 
 Addition                       -            9           17       5,550            -          -     5,576 
 Less : Reclass 
  to Industrial 
  Building                      -            -            -    (21,217)       21,217          -         - 
 At 31 March 
  2017                        163          465          158      10,704       21,217        732    33,439 
                     ------------  -----------  -----------  ----------  -----------  ---------  -------- 
 Less: Accumulated 
  Depreciation 
 At 1 October 
  2016                         15           35           26           -            -         87       163 
 Addition                       9           23           13           -          265          -       310 
 At 31 March 
  2017                         24           58           39           -          265         87       473 
                     ------------  -----------  -----------  ----------  -----------  ---------  -------- 
 Carrying Amount 
 At 31 March 
  2017                        139          407          119      10,704       20,952        645    32,966 
                     ------------  -----------  -----------  ----------  -----------  ---------  -------- 
 
   15.          AMOUNT OWING BY / TO CONTRACT CUSTOMERS 
 
                                                                Audited 
                                                                   Year 
                                  Unaudited     Unaudited         ended 
                                31-Mar-2017   31-Mar-2016   30-Sep-2016 
                                     RM'000        RM'000        RM'000 
 Aggregate cost incurred 
  to date                            83,145        29,261        63,918 
 Add: attributable 
  profits                            28,729        12,870        22,159 
                             --------------  ------------  ------------ 
                                    111,874        42,131        86,077 
 Less: progress billings          (111,473)      (44,684)      (85,676) 
                                        401       (2,553)           401 
                             --------------  ------------  ------------ 
 Represented by: 
 Amounts owing by contract 
  customers                             551             -           551 
 Amounts owing to contract 
  customers                           (150)       (2,553)         (150) 
 
   16.          AMOUNTS OWING BY RELATED PARTIES 
 
                                                             Audited 
                                                                Year 
                               Unaudited     Unaudited         ended 
                             31-Mar-2017   31-Mar-2016   30-Sep-2016 
                                  RM'000        RM'000        RM'000 
 
 Amounts owing by 
  associated undertakings         75,135             -        55,290 
 Amounts owing by 
  related parties                    537             -            97 
 Amounts owing by 
  directors                           35             -            35 
                                  75,707             -        55,422 
                            ------------  ------------  ------------ 
 

Amounts owing by associated undertakings comprise uncollected balances due from Megagreen Energy and Concord Green Energy. The group is a shareholder in each of Megagreen Energy and Concord Green Energy and exercises significant influence over those entities and the directors consider the amounts owing to be recoverable in full.

   17.          TRADE AND OTHER PAYABLES 
 
                                                      Audited 
                                                         Year 
                        Unaudited     Unaudited         ended 
                      31-Mar-2017   31-Mar-2016   30-Sep-2016 
                           RM'000        RM'000        RM'000 
 Trade payable             34,220         6,200        33,857 
 Other payable and 
  accruals                 16,200        14,845           819 
 
                           50,420        21,045        34,676 
                     ------------  ------------  ------------ 
 

The normal credit terms granted to the Group by the suppliers are 90 days (2016: 90 days) from invoice date.

This information is provided by RNS

The company news service from the London Stock Exchange

END

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