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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Mobilityone Limited | LSE:MBO | London | Ordinary Share | JE00B1Z48326 | ORD 2.5P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 5.00 | 4.50 | 5.50 | 5.00 | 5.00 | 5.00 | 2,311 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
Business Services, Nec | 233.76M | 24k | 0.0002 | 250.00 | 5.31M |
TIDMMBO
RNS Number : 7950J
MobilityOne Limited
30 June 2017
30 June 2017
MobilityOne Limited
("MobilityOne", "Company" or the "Group")
Audited results for the year ended 31 December 2016
MobilityOne (AIM: MBO), the e-commerce infrastructure payment solutions and platform provider with its main operations in Malaysia, announces its full year results for the year ended 31 December 2016.
A copy of the annual report and audited financial statements, along with notice of the Company's annual general meeting, to be held at 9.00 a.m. Malaysia time on 25 July 2017 at B-10-8, Level 10, Megan Avenue II, Jalan Yap Kwan Seng, 50450 Kuala Lumpur, Malaysia, is being posted to shareholders today and will be available shortly on the Company's website, www.mobilityone.com.my.
For further information, please contact:
MobilityOne Limited +6 03 8996 3600 Dato' Hussian A. Rahman, CEO www.mobilityone.com.my har@mobilityone.com.my Allenby Capital Limited (Nominated Adviser and Broker) +44 20 3328 5656 Nick Athanas/James Reeve/Richard Short
About the Group:
MobilityOne provides e-commerce infrastructure payment solutions and platforms through its proprietary technology solutions, marketed under the brands MoCS and ABOSSE.
The Group has developed an end-to-end e-commerce solution which connects various service providers across several industries such as banking, telecommunication and transportation through multiple distribution devices including EDC terminals, mobile devices, automated teller machines ("ATM") and internet banking.
The Group's technology platform is flexible, scalable and designed to facilitate cash, debit card and credit card transactions from multiple devices while controlling and monitoring the distribution of different products and services.
For more information, refer to our website at www.mobilityone.com.my
Chairman's Statement
For the year ended 31 December 2016
Introduction
The Directors are pleased to present the audited consolidated financial statements for MobilityOne Limited for the year ended 31 December 2016.
The revenue of the Group decreased by 5.26% to GBP61.73 million (2015 revenue: GBP65.16 million) after several years of positive growth due to a slight reduction of demand for the Group's mobile phone prepaid airtime reload and bill payment business via the Group's existing banking channels (ie, mobile banking, internet banking and ATMs) and payment terminal base in Malaysia. However, the Group reported a higher profit after tax of GBP0.31 million in 2016 (2015 profit after tax: GBP0.16 million) coming as a result of higher margins.
The contribution from the Group's operations in the Philippines remained insignificant with a small revenue contribution through the provision of an e-payment solution.
MobilityOne Sdn Bhd ("MobilityOne Malaysia"), the Company's wholly-owned subsidiary operating in Malaysia, acquired a 50% equity interest in Unique Change Sdn Bhd ("UC") as the Group's associate company in 2016. UC provides international remittance services from Malaysia, mainly to Bangladesh, Nepal and Indonesia. It currently holds a remittance business license issued by the Central Bank of Malaysia and has 6 outlets in Malaysia. The Directors believe that there is good growth potential for UC as currently there are more than 2.0 million foreign workers in Malaysia who have the need to send money back to their home countries.
As at 31 December 2016, the Group had cash and cash equivalents of GBP1.96 million (31 December 2015: cash and cash equivalents of GBP2.22 million) and the secured loans and borrowings from financial institutions totaled GBP2.80 million (31 December 2015: GBP1.88 million).
Current trading and outlook
The Directors expect that the trading performance of the Group will be positive as the prepaid airtime reload and bill payment business in Malaysia is expected to continue its growth. In addition, the Group continues to explore business opportunities and to enhance its product offering for future growth.
In April 2017, MobilityOne Malaysia signed a partnership agreement with Mobility i Tap Pay (Bangladesh) Limited ("MiTBL") for the provision of a mobile financial services platform for Meghna Bank Ltd ("Meghna") in Bangladesh. Meghna is a commercial bank which has more than 30 branches in Bangladesh. MiTBL has given MobilityOne Malaysia an option to acquire 55% of the enlarged share capital of MiTBL for 100 Taka (equivalent to GBP1) within 5 years. The partnership will enable the Group to expand its services into Bangladesh in the future by working with MiTBL which has a good business network to open up new business opportunities in Bangladesh.
In addition, as recently announced, MobilityOne Malaysia has obtained the approval from the Central Bank of Malaysia to issue e-Money for general retail purposes via prepaid card and mobile application. e-Money is a type of payment instrument where it contains monetary value that has been paid in advance by the end users to the e-Money issuer to make payments to purchase goods from merchants such as retail outlets. When the end users pay using e-Money, the amounts are automatically deducted from their e-Money balance. The approval has also been given to allow the e-Money to be used for mobile remittance services by the Group's 50% owned associate company, UC. The e-Money business division will complement the Group's expanding network reach as e-Money provides an alternative payment method without the need for cash handling. At the same time, the Group will generate revenue from e-Money transactions. Moreover, the e-Money issuing capability can further strengthen the Group's plans to be a significant player in the fintech industry in Malaysia. In the next few months, the Group will progress the implementation of the e-Money business and expects to launch the business in the 1(st) half of 2018.
.............................................
Abu Bakar bin Mohd Taib
Chairman
Date: 30 June 2017
Report of the Directors
For the year ended 31 December 2016
The Directors are pleased to submit their report together with the financial statements of the Company and the Group for the year ended 31 December 2016.
PRINCIPAL ACTIVITY
The principal activity of the Group in the year under review was mainly in the business of providing e-commerce infrastructure payment solutions and platforms.
KEY PERFORMANCE INDICATORS
Year ended Year ended 31.12.2016 31.12.2015 GBP GBP Revenue 61,734,675 65,161,080 Operating profit 557,444 345,606 Profit before tax 381,165 192,320 Net profit for the year 314,977 163,220
KEY RISKS AND UNCERTANTIES
Operational risks
The Group is not insulated from general business risk as well as certain risks inherent in the industry in which the Group operates. In particular, this includes technological changes, unfavourable changes in Government and international policies, the introduction of new and superior technology or products and services by competitors and changes in the general economic, business and credit conditions.
Dependency on Distributorship Agreements
The Group relies on various telecommunication companies to provide the telecommunication products. As a result, the Group's business may be materially and adversely affected if one or more of these telecommunication companies cut or reduce drastically the supply of their products. The Group has distributorship agreements with telecommunication companies such as DiGi Telecommunications Sdn. Bhd., Celcom (M) Berhad and Maxis Communication Berhad, which are subject to periodic renewal.
Rapid technological changes/product changes in the e-commerce industry
If the Group is unable to keep pace with rapid technological development in the e-commerce industry it may adversely affect the Group's revenues and profits. The e-commerce industry is characterised by rapid technological changes due to changing market trends, evolving industry standards, new technologies and emerging competition. Future success will be dependent upon the Group's ability to enhance its existing technology solutions and introduce new products and services to respond to the constantly changing technological environment. The timely development of new and enhanced services or products is a complex and uncertain process.
Demand of products and services
The Group's future results depend on the overall demand for its products and services. Uncertainty in the economic environment may cause some business to curtail or eliminate spending on payment technology. In addition, the Group may experience hesitancy on the part of existing and potential customers to commit to continuing with its new services.
KEY RISKS AND UNCERTANTIES (CONT'D)
Financial risks
Please refer to Note 3.
REVIEW OF BUSINESS
The results for the year and financial position of the Company and the Group are as shown in the Chairman's statement.
RESULTS AND DIVIDS
The consolidated total comprehensive profit for the year ended 31 December 2016 was GBP419,903 (2015:GBP58,603) which has been transferred to reserves. No dividends will be distributed for the year ended 31 December 2016.
DIRECTORS
The Directors during the year under review were:
Abu Bakar bin Mohd Taib (Non-Executive Chairman)
Dato' Hussian @ Rizal bin A. Rahman (Chief Executive Officer)
Derrick Chia Kah Wai (Technical Director)
Seah Boon Chin (Non-Executive Director)
The beneficial interests of the Directors holding office at 31 December 2016 in the ordinary shares of the Company, were as follows:
Ordinary shares of 2.5p each
Interest at 31.12.16 % of issued capital Abu Bakar bin Mohd Nil Nil Taib Dato' Hussian @ Rizal bin A. Rahman 53,465,724 50.30 Derrick Chia Kah Wai Nil Nil Seah Boon Chin Nil Nil
The wife of Derrick Chia Kah Wai holds 1,943,000 ordinary shares in the Company, which is 1.83% of the Company's issued capital.
The Directors also held the following ordinary shares under options:
Interest at 31.12.16 Abu Bakar bin Mohd Taib 500,000 Dato' Hussian @ Rizal bin A. Rahman 800,000 Derrick Chia Kah Wai 2,000,000 Seah Boon Chin 2,000,000
The options were granted on 5 December 2014 at an exercise price of 2.5p. The period of the options is ten years.
The Directors' remuneration of the Group is disclosed in Note 4.
SUBSTANTIAL SHAREHOLDERS
As at 23 June 2017, the Company had been notified of the following beneficial interests in 3% or more of the issued share capital pursuant to Part VI of Article 110 of the Companies (Jersey) Law 1991:
Ordinary 2.5p shares
Number of ordinary % of issued capital shares Dato' Hussian @ Rizal bin A. Rahman 53,465,724 50.30 Thornbeam Limited 16,048,922 15.10 Estate of Dato' Shamsir bin Omar 9,131,677 8.59 Perbadanan Nasional Berhad 4,690,000 4.41
PUBLICATION OF ACCOUNTS ON COMPANY WEBSITE
Financial statements are published on the Company's website, which can be found at www.mobilityone.com.my. The maintenance and integrity of the website is the responsibility of the Directors. The Directors' responsibility also extends to the financial statements contained therein.
INDEMNITY OF OFFICERS
The Group does not have the insurance cover against legal action bought against its Directors and officers.
GROUP'S POLICY ON PAYMENT OF CREDITORS
It is the Group's normal practice to make payments to suppliers in accordance with agreed terms provided that the supplier has performed in accordance with the relevant terms and conditions.
EMPLOYEE INVOLVEMENT
The Group places considerable value on the involvement of the employees and has continued to keep them informed on matters affecting the Group. This is achieved through formal and informal meetings.
GOING CONCERN
These financial statements have been prepared on the assumption that the Group is a going concern. Further information is given in Note 2 of the financial statements.
SIGNIFICANT EVENTS
There was no significant event during the financial year.
STATEMENT OF DIRECTORS' RESPONSIBILITIES
The Directors are responsible for preparing the Directors' Report and financial statements in accordance with applicable law and regulations.
Company law requires the Directors to prepare financial statements for each financial year. Under that law the Directors have elected to prepare the financial statements in accordance with International Financial Reporting Standards (IFRS) as adopted for use in the European Union. Under Company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and the Group and of the profit or loss of the Group for that period. In preparing these financial statements, the Directors are required to:
- select suitable accounting policies and then apply them consistently; - make judgments and estimates that are reasonable and prudent;
- prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business for the foreseeable future; and
- state that the financial statements comply with International Financial Reporting Standards (IFRS) as adopted by the European Union.
The Directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the Company and the Group and to enable them to ensure that the financial statements comply with Article 110 of the Companies (Jersey) Law 1991. They are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS
So far as the Directors are aware, there is no relevant audit information of which the Company and Group's auditors are unaware, and each Director has taken all the steps that he ought to have taken as a Director in order to make himself aware of any relevant audit information and to establish that the Company and Group's auditors are aware of that information.
AUDITORS
Jeffreys Henry LLP have expressed their willingness to continue in office as auditors to the Company. A resolution proposing that Jeffreys Henry LLP be re-appointed will be put to the forthcoming Annual General Meeting.
ON BEHALF OF THE BOARD:
............................................................................
Dato' Hussian @ Rizal bin A. Rahman
Chief Executive Officer
Date: 30 June 2017
Board of Directors
Abu Bakar bin Mohd Taib
(Non-Executive Chairman)
Abu Bakar bin Mohd Taib, a Malaysian aged 64, has previously worked for several listed companies and financial institutions in Malaysia including Nestle (Malaysia) Berhad, Bank Bumiputera Malaysia Berhad (now part of CIMB Bank Berhad) and United Malayan Banking Berhad (now part of RHB Bank Berhad). He was mainly involved in corporate communications and corporate affairs until 2004. Since 2005 he has been the director of several companies that are principally involved in timber related activities in Malaysia. He obtained a Master of Business Administration in Marketing and Finance from West Coast University (USA) and a Bachelor of Science in Business Administration from California State University (USA).
Dato' Hussian @ Rizal bin A. Rahman
(Chief Executive Officer)
Dato' Hussian @ Rizal bin A. Rahman, a Malaysian aged 55, is the Chief Executive Officer of the Group. He has extensive experience in the IT and telecommunications industries in Malaysia and is responsible for the development of the Group's overall management, particularly in setting the Group's business direction and strategies. He is currently a Non-Executive Director of TFP Solutions Berhad which is listed on the ACE Market of Bursa Malaysia Securities Berhad (Malaysia Stock Exchange). He obtained a certified Master of Business Administration from the Oxford Association of Management, England.
Derrick Chia Kah Wai
(Technical Director)
Derrick Chia Kah Wai, a Malaysian aged 46, is the Technical Director of the Group. He began his career as a programmer in 1994, he then joined GHL Systems Berhad in January 1998 as a Software Engineer and was promoted to Software Development Manager in December 1999. He obtained his Bachelor Degree in Commerce, majoring in Management Information System from University of British Columbia, Canada. He joined the Group in May 2005 and is responsible for the Group's R&D team which include the architectural design of its technology platform.
Seah Boon Chin
(Non-Executive Director)
Seah Boon Chin, a Malaysian aged 45, began his career in 1995 as a senior officer with a financial institution in Malaysia and worked in the Corporate Finance Department of several established financial institutions in Malaysia and Singapore including CIMB Investment Bank Berhad and Public Investment Bank Berhad. He is currently the Head of Corporate Finance with TA Securities Holdings Berhad in Malaysia and a Non-Executive Director of All Asia Asset Capital Limited, which is listed on AIM of the London Stock Exchange. He obtained his Bachelor Degree in Commerce (Honours) with Distinction from McMaster University, Canada.
Report of the Independent Auditors to the Members of
MobilityOne Limited
We have audited the financial statements of MobilityOne Limited for the year ended 31 December 2016 which comprise the Consolidated Income Statement, Consolidated Statement of Comprehensive Income, Consolidated Statement of Changes in Equity, Consolidated Statement of Financial Position, Company Statement of Financial Position, Consolidated Statement of Cash Flows, Company Statement of Cash Flows and the related notes. The financial reporting framework that has been applied in their preparation is applicable law and International Financial Reporting Standards (IFRSs) as adopted by the European Union and, as regards the parent Company nancial statements, as applied in accordance with the provisions of the Companies (Jersey) Law 1991.
This report is made solely to the Company's members, as a body, in accordance with Article 113A of the Companies (Jersey) Law 1991. Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an auditors' report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members as a body, for our audit work, for this report, or for the opinions we have formed.
Respective responsibilities of Directors and Auditors
As explained more fully in the Directors' Responsibilities Statement set out on page 5, the directors are responsible for the preparation of the nancial statements and for being satis ed that they give a true and fair view. Our responsibility is to audit and express an opinion on the nancial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing Practices Board's Ethical Standards for Auditors.
Scope of the audit of the financial statements
An audit involves obtaining evidence about the amounts and disclosures in the nancial statements sufficient to give reasonable assurance that the nancial statements are free from material misstatement, whether caused by fraud or error. This includes an assessment of: whether the accounting policies are appropriate to the Group's and the parent Company's circumstances and have been consistently applied and adequately disclosed; the reasonableness of signi cant accounting estimates made by the directors; and the overall presentation of the nancial statements.
In addition, we read all the financial and non-financial information in the Chairman's Statement and Directors' Report to identify material inconsistencies with the audited financial statements and to identify any information that is apparently materially incorrect based on, or materially inconsistent with, the knowledge acquired by us in the course of performing the audit. If we become aware of any apparent material misstatements or inconsistencies we consider the implications for our report.
Opinion on the financial statements
In our opinion:
- the financial statements give a true and fair view of the state of the Group's and of the parent Company's state of affairs as at 31 December 2016 and of the Group's profit and the Group's and parent Company's cash flow for the year then ended 31 December 2016; - the Group nancial statements have been properly prepared in accordance with IFRSs as adopted by the European Union; and - the parent Company nancial statements have been properly prepared in accordance with IFRSs as adopted by the European Union and as applied in accordance with the provisions of the Companies (Jersey) Law 1991; and - the financial statements have been prepared in accordance with the requirement of the Companies (Jersey) Law 1991.
Opinion on other matter
In our opinion, based on the work undertaken in the course of our audit, the information given in the Chairman's Statement and the Report of the Directors for the financial year for which the Group's financial statements are prepared is consistent with the financial statements, and the Chairman's Statement and the Report of the Directors has been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have not identified any material mistatatements in the Chairman's Statement and the Report of the Directors.
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters where Companies (Jersey) Law 1991 requires us to report to you if, in our opinion:
- adequate accounting records have not been kept by the Parent Company, or returns adequate for audit have not been received from branches not visited by us; or - the financial statements are not in agreement with the accounting records and returns; or - certain disclosures of Directors' remuneration specified by law are not made; or - we have not received all the information and explanations we require for our audit.
Sanjay Parmar
Senior Statutory Auditor
For and on behalf of Jeffreys Henry LLP
Finsgate
5-7 Cranwood Street
London
EC1V 9EE
United Kingdom
Date: 30 June 2017
Consolidated Income Statement
For the year ended 31 December 2016
2016 2015 Note GBP GBP Revenue 5 61,734,675 65,161,080 Cost of sales (56,795,647) (61,008,206) -------------- -------------- GROSS PROFIT 4,939,028 4,152,874 Other operating income 136,382 71,408 Administration expenses (4,002,159) (3,228,126) Other operating expenses 7 (515,807) (650,550) -------------- -------------- OPERATING PROFIT 557,444 345,606 Finance costs 6 (176,279) (153,286) -------------- -------------- PROFIT BEFORE TAX 7 381,165 192,320 Discontinued operations, - - net of tax Tax 8 (66,188) (29,100) -------------- -------------- PROFIT FOR THE YEAR 314,977 163,220 ============== ============== Attributable to: Owners of the parent 315,352 165,678 Non-controlling interests (375) (2,458) -------------- -------------- 314,977 163,220 ============== ============== BASIC EARNINGS PER SHARE 10 Continuing operations (pence) 0.297 0.156 Discontinued operations - - (pence) -------------- -------------- 0.297 0.156 -------------- -------------- DILUTED EARNINGS PER SHARE 10 Continuing operations (pence) 0.270 0.142 Discontinued operations - - (pence) -------------- -------------- 0.270 0.142 -------------- --------------
Consolidated Statement of Comprehensive Income
For the year ended 31 December 2016
2016 2015 GBP GBP PROFIT FOR THE YEAR 314,977 163,220 OTHER COMPREHENSIVE PROFIT/(LOSS) Foreign currency translation 104,926 (104,617) -------- ---------- TOTAL COMPREHENSIVE PROFIT 419,903 58,603 ======== ========== Total comprehensive profit attributable to: Owners of the parent 420,453 61,061 Non-controlling interests (550) (2,458) -------- ---------- 419,903 58,603 ======== ==========
Consolidated Statement Of Changes in Equity
For The Year Ended 31 December 2016
Non-Distributable Distributable ------------------------------------ -------------- Reverse Foreign Non- Currency controlling Interests Share Share Acquisition Translation Accumulated Total Total Capital Premium Reserve Reserve Losses Equity GBP GBP GBP GBP GBP GBP GBP GBP As at 1 January 2015 2,657,470 909,472 708,951 793,863 (3,867,475) 1,202,281 (3,165) 1,199,116 ---------- -------- ------------ ------------ -------------- ---------- ---------------- ---------- Comprehensive profit/(loss) Profit/(loss) for the year - - - - 165,678 165,678 (2,458) 163,220 Foreign currency translation - - - (104,617) - (104,617) - (104,617) ---------- -------- ------------ ------------ -------------- ---------- ---------------- ---------- Total comprehensive profit for the year - - - (104,617) 165,678 61,061 (2,458) 58,603 At 31 December 2015 2,657,470 909,472 708,951 689,246 (3,701,797) 1,263,342 (5,623) 1,257,719 ========== ======== ============ ============ ============== ========== ================ ========== Non-Distributable Distributable ------------------------------------ -------------- Reverse Foreign Non- Currency controlling
Interests Share Share Acquisition Translation Accumulated Total Total Capital Premium Reserve Reserve Losses Equity GBP GBP GBP GBP GBP GBP GBP GBP As at 1 January 2016 2,657,470 909,472 708,951 689,246 (3,701,797) 1,263,342 (5,623) 1,257,719 ---------- -------- ------------ ------------ -------------- ---------- ---------------- ---------- Comprehensive profit/(loss) Profit/(loss) for the year - - - - 315,352 315,352 (375) 314,977 Foreign currency translation - - - 105,101 - 105,101 (175) 104,926 ---------- -------- ------------ ------------ -------------- ---------- ---------------- ---------- Total comprehensive profit for the year - - - 105,101 315,352 420,453 (550) 419,903 At 31 December 2016 2,657,470 909,472 708,951 794,347 (3,386,445) 1,683,795 (6,173) 1,677,622 ========== ======== ============ ============ ============== ========== ================ ==========
Share capital is the amount subscribed for shares at nominal value.
Share premium represents the excess of the amount subscribed for share capital over the nominal value of the respective shares net of share issue expenses.
The reverse acquisition reserve relates to the adjustment required by accounting for the reverse acquisition in accordance with IFRS 3.
The Company's assets and liabilities stated in the Statement of Financial Position were translated into Pound Sterling (GBP) using the closing rate as at the Statement of Financial Position date and the Income Statements were translated into GBP using the average rate for that period. All resulting exchange differences are taken to the foreign currency translation reserve within equity.
Retained earnings represent the cumulative earnings of the Group attributable to equity shareholders.
Non-controlling interests represent the share of ownership of subsidiary companies outside the Group.
Company Statement Of Changes in Equity
For The Year Ended 31 December 2016
Non-Distributable ----------------------------------------------- Share Share Accumulated Capital Premium Losses Total GBP GBP GBP GBP As at 1 January 2016 2,657,470 909,472 (1,185,189) 2,381,753 Loss for the year - - (92,465) (92,465) At 31 December 2016 2,657,470 909,472 (1,277,654) 2,289,288 ========== ========= ============ ========== As at 1 January 2015 2,657,470 909,472 (927,342) 2,639,600 Loss for the year - - (257,847) (257,847) At 31 December 2015 2,657,470 909,472 (1,185,189) 2,381,753 ========== ========= ============ ==========
Consolidated Statement of Financial Position
As at 31 December 2016
2016 2015 Note GBP GBP ASSETS Non-current assets Intangible assets 11 - 54,291 Property, plant and equipment 12 507,151 497,567 507,151 551,858 ------------ ------------ Current assets Inventories 14 1,101,772 1,063,008 Trade and other receivables 16 2,922,999 3,347,788 Cash and cash equivalents 17 1,955,270 2,216,715 Tax recoverable 45,222 3,016 ------------ ------------ 6,025,263 6,630,527 ------------ ------------ TOTAL ASSETS 6,532,414 7,182,385 SHAREHOLDERS' EQUITY Equity attributable to owners of the parent: Called up share capital 18 2,657,470 2,657,470 Share premium 19 909,472 909,472 Reverse acquisition reserve 20 708,951 708,951 Foreign currency translation reserve 21 794,347 689,246 Retained earnings 22 (3,386,445) (3,701,797) Shareholders' equity 1,683,795 1,263,342 Non-controlling interests (6,173) (5,623) ------------ ------------ TOTAL EQUITY 1,677,622 1,257,719 ------------ ------------ 2016 2015 Note GBP GBP LIABILITIES Non-current liability Loans and borrowings - secured 23 323,726 296,692 -------- -------- Current liabilities Trade and other payables 25 2,101,229 3,927,768 Amount due to Directors 26 113,501 118,603 Loans and borrowings - secured 23 2,316,336 1,581,603 4,531,066 5,627,974 Total liabilities 4,854,792 5,924,666 ---------- ---------- TOTAL EQUITY AND LIABILITIES 6,532,414 7,182,385 ========== ==========
The financial statements were approved and authorised by the Board of Directors on 30 June 2017 and were signed on its behalf by:
............................................................................
Dato' Hussian @ Rizal bin A. Rahman
Chief Executive Officer
Company Statement of Financial Position
As at 31 December 2016
2016 2015 Note GBP GBP ASSETS Non-current asset Investment in subsidiary companies 13 1,976,338 1,976,338 ------------ ------------ Current assets Trade and other receivables 16 1,068,386 536,982 Cash and cash equivalents 17 2,010 2,018 ------------ ------------ 1,070,396 539,000 ------------ ------------ TOTAL ASSETS 3,046,734 2,515,338 ============ ============ SHAREHOLDERS' EQUITY Equity attributable to owners of the parent: Called up share capital 18 2,657,470 2,657,470 Share premium 19 909,472 909,472 Retained earnings 22 (1,277,654) (1,185,189) ------------ ------------ TOTAL EQUITY 2,289,288 2,381,753 ============ ============ Current liabilities Trade and other payables 25 646,511 20,490 Amount due to Directors 26 110,935 113,095 ---------- ---------- TOTAL LIABILITIES 757,446 133,585 ---------- ---------- TOTAL EQUITY AND LIABILITIES 3,046,734 2,515,338 ========== ==========
The financial statements were approved and authorised by the Board of Directors on 30 June 2017 and were signed on its behalf by:
............................................................................
Dato' Hussian @ Rizal bin A. Rahman
Chief Executive Officer
Consolidated Statement of Cash Flows
For the year ended 31 December 2016
2016 2015 Note GBP GBP Cash flow from/(used in) operating activities Cash flow from/(used in) operations 27 (792,145) 1,972,724 Interest paid (176,279) (153,286) Interest received 46,872 51,395 Tax paid (108,394) (44,948) Tax refund - 434 ----------- ----------- Net cash generated from /(used in) operating activities (1,029,946) 1,826,319 ----------- ----------- Cash flow from investing activities Purchase of property, plant and equipment 12 (23,871) (111,191) Net cash outflow for disposal of subsidiary company - - Net cash inflow for acquisition of subsidiary company - - Net cash used in investing activities (23,871) (111,191) Cash flows from financing activities Repayment of letter credit - (159,305) Net change of banker acceptance 23 763,946 (779,272)
Repayment of finance lease payables (35,962) (114,717) Repayment of term loan (33,783) (46,355) Net cash from/(used in) financing activities 761,767 (1,099,649) ----------- ----------- Increase in cash and cash equivalents (292,050) 615,479 Effect of foreign exchange rate changes 30,605 (7,019) Cash and cash equivalents at beginning of year 2,216,715 1,608,255 ----------- ----------- Cash and cash equivalents at end of year 17 1,955,270 2,216,715 =========== ===========
Company Statement of Cash Flows
For the year ended 31 December 2016
2016 2015 Note GBP GBP Cash flow from operating activities Cash depleted in operations 27 (8) - ----- ----- Cash flow from financing activities Proceeds from issuance of shares - - ----- ----- Decrease in cash and cash equivalents (8) - Effect of foreign exchange rate changes - - Cash and cash equivalents at beginning of year 2,018 2,018 ----- ----- Cash and cash equivalents at end of year 17 2,010 2,018 ===== =====
Notes to the Financial Statements
For the year ended 31 December 2016
1. GENERAL INFORMATION
The principal activity of the Company is investment holding. The principal activities of the subsidiary companies are set out in Note 13 to the financial statements. There were no significant changes in the nature of these activities during the year.
The Company is incorporated in Jersey, the Channel Islands under the Companies (Jersey) Law 1991 and is listed on AIM. The registered office is located at Queensway House, Hilgrove Street, St Helier, Jersey JE1 1ES, Channel Islands. The consolidated financial statements for the year ended 31 December 2016 comprise the results of the Company and its subsidiary companies undertakings. The Company's shares are traded on AIM of the London Stock Exchange.
MobilityOne Limited is the holding company of an established group of companies ("Group") based in Malaysia which is in the business of providing e-commerce infrastructure payment solutions and platforms through their proprietary technology solutions, which are marketed under the brands MoCS(TM) and ABOSSE(TM) .
The Group has developed an end-to-end e-commerce solution which connects various service providers across several industries such as banking, telecommunication and transportation through multiple distribution devices such as EDC terminals, short messaging services, Automated Teller Machine and Internet banking.
The Group's technology platform is flexible, scalable and has been designed to facilitate cash, debit card and credit card transactions (according to the device) from multiple devices while controlling and monitoring the distribution of different products and services.
2. ACCOUNTING POLICIES
Basis of preparation
These financial statements have been prepared in accordance with International Financial Reporting Standards (IFRSs and IFRIC interpretations) issued by the International Accounting Standards Board (IASB), as adopted by the European Union, and with those parts of the Companies (Jersey) Law 1991 applicable to companies preparing their financial statements under IFRS. The financial statements have been prepared under the historical cost convention.
Going Concern
The Group's business activities, together with the factors likely to affect its future development, performance and position, are set out in Chairman's statement on page 2. The financial position of the Group, its cash flows, liquidity position and borrowing facilities are described in the financial statements and associated notes. In addition, Note 3 to the financial statements includes the Group's objectives, policies and processes for managing its capital; its financial risk management objectives; details of its financial instruments and hedging activities; and its exposures to credit risk and liquidity risk.
In order to assess the going concern of the Group, the Directors have prepared cashflow forecasts for companies within the Group. These cashflow forecasts show the Group expect an increase in revenue and will have sufficient headroom over available banking facilities. The Group has obtained banking facilities sufficient to facilitate the growth forecast in future periods. No matters have been drawn to the Directors' attention to suggest that future renewals may not be forthcoming on acceptable terms.
In addition, the controlling shareholder has also undertaken to provide support to enable the Group to meet its debts as and when they fall due.
2. ACCOUNTING POLICIES (Continued)
Going Concern (continued)
After making enquiries, the Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the financial statements.
The financial statement does not include any adjustments that would result if the forecast were not achieved and shareholder support was withdrawn.
Estimation uncertainty and critical judgements
The significant areas of estimation uncertainty and critical judgements in applying accounting policies that have the most significant effect on the amount amortisation in the financial statements are as follows:
(i) Depreciation of property, plant and equipment
The costs of property, plant and equipment of the Group are depreciated on a straight-line basis over the useful lives of the assets. Management estimates the useful lives of the property, plant and equipment to be within 3 to 50 years. These are common life expectancies applied in the industry. Changes in the expected level of usage and technological developments could impact the economic useful lives and the residual values of these assets, therefore future depreciation charges could be revised. The carrying amounts of the Group's property, plant and equipment as at 31 December 2016 are disclosed in Note 12 to the financial statements.
(ii) Amortisation of intangible assets
Software is amortised over its estimated useful life. Management estimated the useful life of this asset to be within 10 years. Changes in the expected level of usage and technological development could impact the economic useful life therefore future amortisation could be revised.
The research and development costs are amortised on a straight-line basis over the life span of the developed assets. Management estimated the useful life of these assets to be within 5 years. Changes in the technological developments could impact the economic useful life and the residual values of these assets, therefore future amortisation charges could be revised.
The carrying amounts of the Group's intangible assets as at 31 December 2016 are disclosed in Note 11 to the financial statements.
However, if the projected sales do not materialise there is a risk that the value of the intangible assets shown above would be impaired.
2. ACCOUNTING POLICIES (Continued)
Estimation uncertainty and critical judgements (continued)
(iii) Impairment of goodwill on consolidation
The Group determines whether goodwill is impaired at least on an annual basis. This requires an estimation of the value-in-use of the cash generating units ("CGU") to which goodwill is allocated. Estimating a value-in-use amount requires management to make an estimation of the expected future cash flows from the CGU and also to choose a suitable discount rate in order to calculate the present value of those cash flows.
The Group's cash flow projections include estimates of sales. However, if the projected sales do not materialise there is a risk that the value of goodwill would be impaired.
The Directors have carried out a detailed impairment review in respect of goodwill. The Group assesses at each reporting date whether there is an indication that an asset may be impaired, by considering the cash flows forecasts. The cash flow projections are based on the assumption that the Group can realise projected sales. A prudent approach has been applied with no residual value being factored. At the period end, based on these assumptions, there was indication of impairment of the value of goodwill and of development costs.
The carrying amount of the Group's goodwill on consolidation as at 31 December 2016 is disclosed in the Note 11 to the financial statements.
(iv) Going concern
The Group determines whether it has sufficient resources in order to continue its activities by reference to budget together with current and forecast liquidity. This requires on estimate of the availability of such funding which is critically dependent on external borrowings support from the majority shareholders of the Group and, to an extent, macro-economic factors.
IFRS AND IAS UPDATE FOR 31 DECEMBER 2016 ACCOUNTS
Changes in accounting policies and disclosures
During the financial year, the Group has adopted the following new and amended IFRS and IFRIC interpretations that are mandatory for current financial year:
Amendments of Defined Benefit Plans: Employee IFRS 119 Contributions Annual Improvements of IFRS 2010 - 2012 Cycle Annual Improvements of IFRS 2011 - 2013 Cycle Amendments to Recoverable Amount Disclosures IFRS 136 for Non-Financial Assets Amendments to Novation of Derivatives and IFRS 139 Continuation of Hedge Accounting IC Interpretation Levies 21
The impact of adopting the above amendments had no material impact on the financial statements of the Group.
Standards, interpretations and amendments to published standards that are not yet effective
The following standards, amendments and interpretations applicable to the Group are in issue but are not yet effective and have not been early adopted in these financial statements. They may result in consequential changes to the accounting policies and other note disclosures. We do not expect the impact of such changes on the financial statements to be material. These are outlined in the table below:
Effective dates for Financial periods Beginning on or after IFRS 14 Regulator Deferral 1 January Account 2016 Amendments Accounting for Acquisitions 1 January to IFRS 11 of Interests in Joint 2016 Operations Amendments Disclosure Initiative 1 January to IFRS 101 2016 Amendments Clarification of Acceptable 1 January to IFRS 116 Methods of 2016 And IFRS 138 Depreciation and Amortisation Amendments Agriculture: Bearer 1 January to IFRS 116 Plants 2016 and IFRS 141 Amendments Equity Method in Separate 1 January to IFRS 127 Financial Statements 2016 Annual Improvements of IFRSs 2012 1 January - 2014 Cycle 2016 Amendments Investment Entities: 1 January to IFRS 10, Applying the Consolidation 2016 IFRS 12 and Exception IFRS 128 IFRS 9 Financial Instruments 1 January (IFRS 9 Issued by IASB 2018 in July 2014) IFRS 15 Revenue from Contracts 1 January with Customers 2018 Amendments Sale or Contribution To be announced to IFRS 10 of Assets between an IFRS 128 Investor and its Associate or Joint Venture
The Directors anticipate that the adoption of these standards and the interpretations in future periods will have no material impact on the financial statements of the Group.
Basis of consolidation
The consolidated financial statements incorporate the financial statements of the Company and entities controlled by the Company (its subsidiary companies) made up to 31 December each year. Control is achieved where the Company has the power to govern the financial and operating policies of an investee entity so as to obtain benefits from its activities.
Transactions, balances and unrealised gains on transactions between Group companies are eliminated. Unrealised losses are also eliminated but considered an impairment indicator of the asset transferred. Accounting policies of its subsidiary companies have been changed (where necessary) to ensure consistency with the policies adopted by the Group.
(i) Subsidiary companies
Subsidiary companies are entities over which the Group has the ability to control the financial and operating policies so as to obtain benefits from their activities. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group has such power over another entity.
In the Company's separate financial statements, investments in subsidiary companies are stated at cost less impairment losses. On disposal of such investments, the difference between net disposal proceeds and their carrying amounts is included in profit or loss.
(ii) Basis of consolidation
On 22 June 2007 MobilityOne Limited acquired the entire issued share capital of MobilityOne Sdn. Bhd. By way of a share for share exchange, under IFRS this transaction meets the criteria of a Reverse Acquisition. The consolidated accounts have therefore been presented under the Reverse Acquisition Accounting principles of IFRS 3 and show comparatives for MobilityOne Sdn. Bhd. For financial reporting purposes, MobilityOne Sdn. Bhd. (the legal subsidiary company) is the acquirer and MobilityOne Limited (the legal parent company) is the acquiree.
No goodwill has been recorded and the difference between the parent Company's cost of investment and MobilityOne Sdn. Bhd.'s share capital and share premium is presented as a reverse acquisition reserve within equity on consolidation.
The consolidated financial statements incorporate the financial statements of the Company and all entities controlled by it after eliminating internal transactions. Control is achieved where the Group has the power to govern the financial and operating policies of a Group undertaking so as to obtain economic benefits from its activities. Undertakings' results are adjusted, where appropriate, to conform to Group accounting policies.
Subsidiary companies are consolidated from the date of acquisition, being the date on which the Group obtains control, and continue to be consolidated until the date that such control ceases. In preparing the consolidated financial statements, intra-group balances, transactions and unrealised gains or losses are eliminated in full. Uniform accounting policies are adopted in the consolidated financial statements for like transactions and events in similar circumstances.
The share capital in the consolidated statement of changes in equity for both the current and comparative period uses a historic exchange rate to determine the equity value.
As permitted by and in accordance with Article 110 of the Companies (Jersey) Law 1991, a separate income statement of MobilityOne Limited, is not presented.
Revenue recognition
Revenue is recognised when it is probable that economic benefits associated with the transaction will flow to the Group and the amount of the revenue can be measured reliably.
(i) Revenue from trading activities
Revenue in respect of using the Group's e-Channel platform arises from the sales of prepaid credit, sales commissions received and fees per transaction charged to customers. Revenue for sales of prepaid credit is deferred until such time as the products and services are delivered to end users. Sales commissions and transaction fees are received from various product and services providers and are recognised when the services are rendered and transactions are completed.
Revenue from solution sales and consultancy comprise sales of software solutions, hardware equipment, consultancy fees and maintenance and support services. For sales of hardware equipment, revenue is recognised when the significant risks associated with the equipment are transferred to customers or the expiry of the right of return. For all other related sales, revenue is recognised upon delivery to customers and over the period in which services are expected to be provided to customers.
Revenue from remittance comprises transaction service fees charged to customers/senders. Transaction fees are received from senders and are recognised when the services are rendered and transactions are completed.
(ii) Interest income
Interest income is recognised on a time proportion basis that takes into account the effective yield on the asset.
(iii) Rental income
Rental income is recognised on an accrual basis.
Employee benefits
(i) Short term employee benefits
Wages, salaries, bonuses and social security contributions are recognised as an expense in the period in which the associated services are rendered by employees of the Group. Short term accumulating compensated absences such as paid annual leave are recognised when services are rendered by employees that increase their entitlement to future compensation absences. Short term non-accumulating compensated absences such as sick and medical leave are recognised when the absences occur.
The expected cost of accumulating compensated absences is measured as the additional amount expected to be paid as a result of the unused entitlement that has accumulated at the Statement of Financial Position date.
(ii) Defined contribution plans
As required by law, companies in Malaysia make contributions to the state pension scheme, the Employees Provident Fund ("EPF"). Such contributions are recognised as an expense in the income statement in the period to which they relate. The other subsidiary companies also make contribution to their respective countries' statutory pension schemes.
Finance leases
Assets financed by leasing arrangements, which give rights approximating to ownership, are treated as if they had been purchased outright and are recognised and depreciated over the shorter of the estimated useful life of the assets and the period of the leases. The capital element of future rentals is treated as a liability and the interest element is charged against profits in proportion to the balances outstanding. The rental costs of all other leased assets are charged against profits on a straight-line basis over the lease term.
Operating leases
Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases (net of incentives received from the lessor) are charged to the income statement.
Functional currency translation
(i) Functional and presentation currency
Items included in the financial statements of each of the Group's entities are measured using the currency of the primary economic environment in which the entity operates (the functional currency). The functional currency of the Group is Ringgit Malaysia (RM). The consolidated financial statements are presented in Pound Sterling (GBP), which is the Company's presentational currency as this is the currency used in the country in which the entity is listed.
Assets and liabilities are translated into Pound Sterling (GBP) at foreign exchange rates ruling at the Statement of Financial Position date. Results and cash flows are translated into Pound Sterling (GBP) using average rates of exchange for the period.
(ii) Transactions and balances
Foreign currency transactions are translated into the functional currency using exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the income statement.
(ii) Transactions and balances (Continued)
The financial information set out below has been translated at the following rates:
Exchange rate (RM: GBP) At Statement of Financial Average Position for year date Year ended 31 December 2016 5.51 5.61 Year ended 31 December 2015 6.36 5.97
Taxation
Taxation on the income statement for the financial period comprises current and deferred tax. Current tax is the expected amount of taxes payable in respect of the taxable profit for the financial period and is measured using the tax rates that have been enacted at the Statement of Financial Position date.
Deferred tax is recognised on the liability method for all temporary differences between the carrying amount of an asset or liability in the Statement of Financial Position and its tax base at the Statement of Financial Position date. Deferred tax liabilities are recognised for all taxable temporary differences and deferred tax assets are recognised for all deductible temporary differences, unused tax losses and unused tax credits to the extent that it is probable that future taxable profit will be available against which the deductible temporary differences, unused tax losses and unused tax credits can be recognised. Deferred tax is not recognised if the temporary difference arises from goodwill or negative goodwill or from the initial recognition of an asset or liability in a transaction which is not a business combination and at the time of the transaction, affects neither accounting profit nor taxable profit.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the period when the asset is recognised or the liability is settled, based on the tax rates that have been enacted or substantively enacted by the Statement of Financial Position date. The carrying amount of a deferred tax asset is reviewed at each Statement of Financial Position date and is reduced to the extent that it becomes probable that sufficient future taxable profit will be available.
Deferred tax is recognised in the income statement, except when it arises from a transaction which is recognised directly in equity, in which case the deferred tax is also charged or credited directly in equity, or when it arises from a business combination that is an acquisition, in which case the deferred tax is included in the resulting goodwill or negative goodwill.
Intangible assets
(i) Research and development costs
All research costs are recognized in the income statement as incurred.
Expenditure incurred on projects to develop new products is recognised and deferred only when the Group can demonstrate the technical feasibility of completing the intangible asset so that it will be available for use or sale, its intention to complete and its ability to use or sell the asset, how the asset will generate future economic benefits, the availability of resources to complete the project and the ability to measure reliably the expenditure during the development. Product development expenditures which do not meet these criteria are expensed when incurred.
Development costs, considered to have finite useful lives, are stated at cost less any impairment losses and are amortised through other operating expenses in the income statement using the straight-line basis over the commercial lives of the underlying products not exceeding five years. Impairment is assessed whenever there is an indication of impairment and the amortisation period and method are also reviewed at least at each Statement of Financial Position date.
(i) Goodwill on consolidation
Goodwill acquired in a business combination is initially measured at cost, representing the excess of the purchase price over the Group's interest in the net fair value of the identifiable assets, liabilities and contingent liabilities.
Following the initial recognition, goodwill is measured at cost less accumulated impairment losses. Goodwill is not amortised but instead, it is reviewed for impairment annually or more frequent when there is objective evidence that the carrying value may be impaired, in accordance with the accounting policy disclosed in impairment of assets.
Gains or losses on the disposal of an entity include the carrying amount of goodwill relating to the entity sold.
(iii) Software
Software which forms an integral part of the related hardware is capitalised with that hardware and included within property, plant and equipment. Software which are not an integral part of the related hardware are capitalised as intangible assets.
Acquired computer software licenses are capitalised on the basis of the costs incurred to acquired and bring to use the specific software. These costs are amortised over their estimated useful life of 10 years.
Impairment of assets
The carrying amounts of assets are reviewed at each reporting date to determine whether there is any indication of impairment.
If any such indication exists then the asset's recoverable amount is estimated. For goodwill that has an indefinite useful life, recoverable amount is estimated at each reporting date or more frequently when indications of impairment are identified.
An impairment loss is recognized if the carrying amount of an asset or its cash-generating unit exceeds its recoverable amount unless the asset is carried at a revalued amount, in which case the impairment loss is recognised directly against any revaluation surplus for the asset to the extent that the impairment loss does not exceed the amount in the revaluation surplus for that same asset. A cash-generating unit is the smallest identifiable asset group that generates cash flows that are largely independent from other assets and groups. Impairment losses are recognized in the income statement in the period in which it arises. Impairment losses recognised in respect of cash-generating units are allocated first to reduce the carrying amount of any goodwill allocated to the units and then to reduce the carrying amount of the other assets in the unit (group of units) on a pro rata basis.
The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset.
Impairment loss on goodwill is not reversed in a subsequent period. An impairment loss for an asset other than goodwill is reversed if, and only if, there has been a change in the estimates used to determine the asset's recoverable amount since the last impairment loss was recognised. The carrying amount of an asset other than goodwill is increased to its revised recoverable amount, provided that this amount does not exceed the carrying amount that would have been determined (net of amortisation or depreciation) had no impairment loss been recognized for the asset in prior years. A reversal of impairment loss for an asset other than goodwill is recognized in the income statement unless the asset is carried at revalued amount, in which case, such reversal is treated as a revaluation increase.
Property, plant and equipment
(a) Recognition and measurement
Property, plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses.
Cost includes expenditures that are directly attributable to the acquisition of the asset. The cost of self-constructed assets includes the cost of materials and direct labour, any other costs directly attributable to bringing the asset to working condition for its intended use, and the costs of dismantling and removing the items and restoring the site on which they are located. Purchased software that is integral to the functionality of the related equipment is capitalised as part of that equipment.
The cost of property, plant and equipment recognised as a result of a business combination is based on fair value at acquisition date. The fair value of property is the estimated amount for which a property could be exchanged on the date of valuation between a willing buyer and a willing seller in an arm's length transaction after proper marketing wherein the parties had each acted knowledgeably, prudently and without compulsion. The fair value of other items of plant and equipment is based on the quoted market prices for similar items.
When significant parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment.
(b) Subsequent costs
The cost of replacing part of an item of property, plant and equipment is recognised in the carrying amount of the item if it is probable that the future economic benefits embodied within the part will flow to the Group and its cost can be measured reliably. The costs of the day-to-day servicing of property, plant and equipment are recognised in the income statement as incurred.
(c) Depreciation
Depreciation is recognised in the income statement on a straight-line basis over the estimated useful lives of property, plant and equipment. Leased assets are depreciated over the shorter of the lease term and their useful lives. Property, plant and equipment under construction are not depreciated until the assets are ready for their intended use.
The estimated useful lives for the current and comparative periods are as follows:
Building 50 years Motor vehicles 5 years Leasehold improvement 10 years Electronic Data Capture 10 years equipment Computer equipment 3 to 5 years Computer software 10 years Furniture and fittings 10 years Office equipment 10 years Renovation 10 years
The depreciable amount is determined after deducting the residual value.
Depreciation methods, useful lives and residual values are reassessed at each financial period end.
Upon disposal of an asset, the difference between the net disposal proceeds and the carrying amount of the assets is charged or credited to the income statement. On disposal of a revalued asset, the attributable revaluation surplus remaining in the revaluation reserve is transferred to the distribution reserve.
Investments
Investments in subsidiary companies are stated at cost less any provision for impairment.
Inventories
Inventories are valued at the lower of cost and net realisable value and are determined on the first-in-first-out method, after making due allowance for obsolete and slow moving items. Net realisable value is based on estimated selling price in the ordinary course of business less the costs of completion and selling expenses.
Trade and other receivables
Trade and other receivables are recognised initially at fair value and subsequently measured at their cost when the contractual right to receive cash or other financial assets from another entity is established.
A provision for doubtful debts is made when there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of the receivables. Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganisation and default or delinquency in payments are considered indicators that a trade and other receivables are impaired.
Cash and cash equivalents
Cash and cash equivalents include cash in hand, deposits held at call with banks, other short-term highly liquid investments with original maturities of three months or less which have an insignificant risk of changes in value and bank overdrafts. For the purpose of Statement of Cash Flows, cash and cash equivalents are presented net of bank overdrafts.
Trade and other payables
Trade and other payables are recognised initially at fair value of the consideration to be paid in the future for goods and services received.
Borrowing costs
Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are recognised as part of the cost of those assets, until such time as the assets are substantially ready for their intended use or sale.
When the borrowings are made specifically for the purpose of obtaining a qualifying asset, the amount of borrowing costs eligible for capitalisation is the actual borrowing costs incurred on that borrowing during the period less any investment income on the temporary investment of funds drawndown from those borrowings.
When the borrowings are made generally, and used for the purpose of obtaining a qualifying asset, the borrowing costs eligible for capitalization are determined by applying a capitalization rate which is weighted on the borrowing costs applicable to the Group's borrowings that are outstanding during the financial period, other than borrowings made specifically for the purpose of acquiring another qualifying asset.
Borrowing costs which are not eligible for capitalization are recognised as an expense in the profit or loss in the period in which they are incurred.
Equity instruments
Instruments that evidence a residual interest in the assets of the Group after deducting all of its liabilities are classified as equity instruments. Issued equity instruments are recorded at proceeds received net of direct issue costs.
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or
options are shown in equity as a deduction, net of value added tax, from the proceeds.
Financial instruments
Financial instruments carried on the Statement of Financial Position include cash and bank balances, deposits, investments, receivables, payables and borrowings. Financial instruments are recognised in the Statement of Financial Position when the Group has become a party to the contractual provisions of the instrument.
Financial instruments are classified as liabilities or equity in accordance with the substance of the contractual arrangement. Interest, dividends and gains and losses relating to a financial instrument classified as a liability, are reported as an expense or income. Distributions to holders of financial instruments classified as equity are charged directly to equity. Financial instruments are offset when the Group has a legally enforceable right to offset and intends to settle either on a net basis or to realise the asset and settle the liability simultaneously.
The particular recognition method adopted for financial instruments recognised on the Statement of Financial Position is disclosed in the individual accounting policy statements associated with each item.
Share based payments
Charges for employees services received in exchange for share based payments have been made for all options granted in accordance with IFRS 2 "Share Based Payments" options granted under the Group's employee share scheme are equity settled. The fair value of such options has been calculated using a Black-scholes model, based upon publicly available market data, and is charged to the profit or loss over the vesting period.
Segment reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision makers are responsible for allocating resources and assessing performance of the operating segments and make overall strategic decisions. The Group's operating
segments are organised and managed separately according to the nature of the products and services provided, with each segment representing a strategic business unit that offers different products and serves different markets.
3. FINANCIAL INSTRUMENTS (a) Financial risk management objectives and policies
The Group and the Company's financial risk management policy is to ensure that adequate financial resources are available for the development of the Group and of the Company's operations whilst managing its financial risks, including interest rate risk, credit risk, foreign currency exchange risk, liquidity and cash flow risk and capital risk. The Group and the Company operates within clearly defined guidelines that are approved by the Board and the Group's policy is not to engage in speculative transactions.
(b) Interest rate risk
Cash flow interest rate risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes in market interest rates. Fair value interest rate risk is the risk that the value of a financial instrument will fluctuate due to changes in market interest rates. As the Group has no significant interest-bearing financial assets, the Group's income and operating cash flows are substantially independent of changes in market interest rates.
The Group's interest rate risk arises primarily from interest-bearing borrowings. Borrowings at floating rates expose the Group to cash flow interest rate risk. Borrowings obtained at fixed rates expose the Group to fair value interest rate risk.
The following tables set out the carrying amounts, the effective interest rates as at the Statement of Financial Position date and the remaining maturities of the Group's financial instruments that are exposed to interest rate risk:
Effective Interest Within More than At 31 December Note Rate 1 year 1-2 2-3 3-4 years 4-5 5 years Total 2016 years years years % GBP GBP GBP GBP GBP GBP GBP Fixed rate: Fixed deposits 17 2.95-3.20 1,590,201 - - - - - 1,590,201 Finance leases 24 2.42-3.50 13,619 14,103 27,056 - - 3,539 58,317 ========== ============ ========= ========= ========== ======== ========== ============ Floating rate: Bankers' acceptance 23 2.50 (2,297,268) - - - - - (2,297,268) Term loan 23 4.60 (5,449) (6,091) (14,110) - (258,827) (284,477) At 31 December 2015 Fixed rate: Fixed deposits 17 2.95-3.20 1,280,186 - - - - - 1,280,186 Finance leases 24 2.42-3.50 (43,741) (11,803) (12,222) (9,004) (7,278) (10,231) (94,279) ========== ============ ========= ========= ========== ======== ========== ============ Floating rate: Bankers' (1,533,322 (1,533,322 acceptance 23 2.50 ) - - - - - ) (4,538 Term loan 23 4.60 ) (4,769) (5,325) (5,882) (5,882) (224,298) (250,694)
Sensitivity analysis for interest rate risk
The interest rate profile of the Group's significant interest-bearing financial instruments, based on carrying amounts as at the end of the reporting period was:
Group 2016 2015 GBP GBP Floating rate instruments Financial liabilities (Note 23) 2,581,745 1,784,016
Interest rate risk sensitivity analysis
(i) Fair value sensitivity analysis for fixed rate instruments
The Group does not account for any fixed rate financial assets and liabilities at fair value through profit or loss, and the Company does not designate derivatives as hedging instruments under a fair value hedged accounting model. Therefore, a change in interest rates at the end of the reporting period would not affect profit or loss.
(ii) Cash flow sensitivity analysis for variable rate instruments
A change of 100 basis points (bp) in interest rates at the end of the reporting period would have increased/(decreased) post-tax profit by the amounts shown below. This analysis assumes that all other variables, in particular foreign currency rates, remained constant.
Group Profit or loss 100 bp 100 bp Increase Decrease GBP GBP 2016 Floating rate instruments (20,578) 20,578 2015 Floating rate instruments (13,376) 13,376 (c) Credit risk
The Group's and the Company's exposure to credit risk arises mainly from receivables. Receivables are monitored on an ongoing basis via management reporting procedure and action is taken to recover debts when due. At each Statement of Financial Position date, there was no significant concentration of credit risk. The maximum exposure to credit risk for the Group and the Company is the carrying amount of the financial assets shown in the Statement of Financial Position.
(d) Foreign currency exchange risk
The Group and the Company do not have significant foreign currency risk at the end of reporting date.
(e) Liquidity and cash flow risks
The Group and the Company seeks to achieve a flexible and cost effective borrowing structure to ensure that the projected net borrowing needs are covered by available committed facilities. Debt maturities are structured in such a way to ensure that the amount of debt maturing in any one year is within the Group's and the Company's ability to repay and/or refinance.
The Group and the Company also maintains a certain level of cash and cash convertible investments to meet its working capital requirements.
The table below summarises the maturity profile of the Group's and the Company's liabilities at the reporting date based on contractual undiscounted repayment obligations.
On demand On demand On demand or within one to over one year five five Total year year 2016 GBP GBP GBP GBP Group Financial liabilities Trade and other payables 2,101,229 - - 2,101,229 Amount due to Directors 113,501 - - 113,501 Loans and borrowings 2,802,957 - - 2,802,957 ------------ ---------- ---------- ------------ Total undiscounted financial liabilities 5,017,587 - - 5,017,687 ============ ========== ========== ============ 2015 GBP GBP GBP GBP Group Financial liabilities Trade and other payables 3,927,768 - - 3,927,768 Amount due to Directors 118,603 - - 118,603 Loans and borrowings 1,581,603 286,460 10,232 1,878,295 ------------ ---------- ---------- ------------ Total undiscounted financial liabilities 5,627,974 286,460 10,232 5,924,666 ============ ========== ========== ============ 2016 Company Financial liabilities Trade and other payables 646,511 - - 646,511 Amount due to Directors 110,935 - - 110,935 Loans and borrowings - - - - Total undiscounted financial liabilities 757,446 - - 757,446 ============ ========== ========== ============ 2015 Company Financial liabilities Trade and other payables 20,490 - - 20,490 Amount due to Directors 113,095 - - 113,095 ------------ ---------- ---------- ------------ Total undiscounted financial liabilities 133,585 - - 133,585 ============ ========== ========== ============ (f) Fair Values
The carrying amounts of financial assets and liabilities of the Group at the reporting date approximated their fair value except as set out below:
Group Carrying amount Fair value GBP GBP 2016 Financial lease liabilities (Note 24) 58,317 64,404 ========= ======== 2015 Financial lease liabilities (Note 24) 94,279 102,699
The carrying amounts of financial assets and financial liabilities other than the above are reasonable approximation of fair value due to their short term nature.
The carrying amounts of the current portion of borrowing is reasonable approximation of fair value due to the insignificant impact of discounting.
(g) Capital risk
The Group's and the Company's objectives when managing capital are to safeguard the Group's and the Company's ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital. In order to maintain or adjust the capital structure, the Group and the Company may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.
4. EMPLOYEES AND DIRECTORS Group 2016 2015 GBP GBP EMPLOYEES Wages, salaries and bonuses 474,336 432,790 Social security contribution 3,887 15,033 Contribution to defined contribution plan 38,787 39,691 Other staff related expenses 13,126 2,601 -------- -------- Continuing operations 530,136 490,115 ======== ======== DIRECTORS Fees 108,838 92,309 Wages, salaries and bonuses 118,037 78,065
Social security contribution 222 60 Contribution to defined contribution plan 12,578 8,918 -------- -------- Continuing operations 239,675 179,352 ======== ========
The number of employees (excluding Directors) of the Group and of the Company at the end of the financial year were 58 (2015: 70) and Nil (2015: Nil) respectively.
The details of remuneration received and receivables by the Directors of the Group during the financial year are as follows:
Defined Group Salaries Social security contribution 2016 Fees and allowances Bonuses contribution plan Total GBP GBP GBP GBP GBP GBP Company's Directors: Dato' Hussian @ Rizal bin A. Rahman 36,000 57,767 - 111 6,932 100,810 Derrick Chia Kah Wai 24,000 53,670 - 111 5,646 83,427 Seah Boon Chin 36,000 6600 - - - 42,600 Subsidiary companies' Directors: Tengku Muhaini Binti Sultan Hj. Ahmad Shah 6,419 - - - - 6,419 Abu Bakar bin Mohd Taib 6,419 - - - - 6,419 -------- ---------------- -------- ---------------- -------------- -------- 108,838 118,037 - 222 12,578 239,675 ======== ================ ======== ================ ============== ======== Group 2015 Company's Directors: Dato' Hussian @ Rizal bin A. Rahman 20,235 34,604 - 30 3,946 58,815 Derrick Chia Kah Wai 24,000 43,461 - 30 4,973 72,464 Seah Boon Chin 36,000 - - - 36,000 Subsidiary companies' Directors: Tengku Muhaini Binti Sultan Hj. Ahmad Shah 6,037 - - - - 6,037 Abu Bakar bin Mohd Taib 6,037 - - - - 6,037 -------- ---------------- -------- ---------------- -------------- -------- 92,309 78,065 - 60 8,919 179,353 ======== ================ ======== ================ ============== ======== 5. OPERATING SEGMENTS
The information reported to the Group's chief operating decision maker to make decisions about resources to be allocated and for assessing their performance is based on the nature of the products and services, and has two reportable operating segments as follows:
(a) Telecommunication services and electronic commerce solutions; and (b) Hardware
Except as above, no other operating segment has been aggregated to form the above reportable operating segments.
Measurement of Reportable Segments
Segment information is prepared in conformity with the accounting policies adopted for preparing and presenting the consolidated financial statements.
No segment assets and capital expenditure are presented as they are mostly unallocated items which comprise corporate assets and liabilities.
No geographical segment information is presented as the Group mainly trades and provides services in only one region - the Far-East.
Discontinued Continuing operations operations Telecommunication Telecommunication services services and electronic and electronic Group commerce commerce Hardware Elimination Total solutions solutions 2016 GBP GBP GBP GBP GBP ============================= =================== ================== =========== ============== =========== Segment revenue: Sales to external customers - 60,190,920 1,543,755 - 61,734,675 - 60,190,920 1,543,755 - 61,734,675 ================================================= ================== =========== ============== =========== Profit before tax - 381,165 - - 381,165 Tax - (66,188) - - (66,188) ----------------------------- ------------------- ------------------ ----------- -------------- ----------- Profit for the year - 314,977 - - 314,977 ============================= =================== ================== =========== ============== =========== Non-cash expenses/(income)* Depreciation of property, plant and equipment - 88,608 - - 88,608 Amortisation of development costs - 54,291 - - 54,291 Impairment loss on goodwill - 142,899 - - 142,899 --------------------------------- -------- ---------
*The disclosure for non-cash expenses has not been split according to the different segments as the cost to obtain such information is excessive and provides very little by way of information.
Discontinued Continuing operations operations Telecommunication Telecommunication services services and electronic and electronic Group commerce commerce Hardware Elimination Total solutions solutions 2015 GBP GBP GBP GBP GBP ============================= =================== ================== =========== ============== =========== Segment revenue: Sales to external customers - 63,493,735 1,667,345 - 65,161,080 - 63,493,735 1,667,345 - 65,161,080 ================================================= ================== =========== ============== =========== Profit before tax - 187,399 4,921 - 192,320 Tax - (28,355) (745) - (29,100) ----------------------------- ------------------- ------------------ ----------- -------------- ----------- Profit for the year - 159,044 4,176 - 163,220 ============================= =================== ================== =========== ============== =========== Non-cash expenses/(income)* Depreciation of property, plant and equipment - 104,749 - - 104,749 Amortisation of development costs - 91,317 - - 91,317 Impairment loss on goodwill 366,591 - - 366,591 - 562,657 - - 562,657 --------------------------------- -------- ---------------------- ---------
*The disclosure for non-cash expenses has not been split according to the different segments as the cost to obtain such information is excessive and provides very little by way of information.
6. FINANCE COSTS Group 2016 2015 GBP GBP Bankers' acceptance interest 147,826 120,418 Finance lease interest 3,957 8,994 Bank guarantee interest 865 769 Bank overdraft 8,666 8,666 Loan from a Director - - Letters of credit 215 - Term loan 14,750 14,439 -------- -------- 176,279 153,286 -------- -------- 7. PROFIT BEFORE TAX
Profit before tax is stated after charging/(crediting):
Group 2016 2015 Note GBP GBP Auditors' remuneration * Statutory audit - Current year 27,755 15,841 - Under/(Over) provided 2,908 8,241 ----------------------------------------- ----- --------- ----------------- Amortisation of intangible 11 assets - - Amortisation of development costs 11 54,291 115,449 Bad debts - 15,781 Property, plant and equipment written off 12 531 3,716 Impairment loss on goodwill 11 - 366,591 Impairment loss on investment - - Directors' remuneration 4 226,874 179,352 ----------------------------------------- ----- --------- ----------------- Depreciation 12 88,608 104,749 Inventories written off 1,701 - Rental of premises and equipment - 37,302 Other income (10,780) (16,225) Interest income (46,872) (42,630) Rental income - (1,391) Gain on foreign exchange - - realised (1,154) (9,826) 8. TAX Group 2016 2015 GBP GBP Current tax expense: Jersey corporation tax - - for the year Foreign tax 38,654 25,273 Under/(Over) provision in prior year: 27,534 Foreign tax 3,827 ------- ------- 66,188 29,100
A reconciliation of income tax expense applicable to profit before tax at the statutory income tax rate to income tax expense at the effective income tax rate of the Group is as follows:
Group 2016 2015 GBP GBP Profit before taxation from continuing operations 381,165 192,320 Loss before taxation from discontinuing operations - ---------- ---------- 381,165 192,320 ---------- ---------- Taxation at Malaysian statutory tax rate of 24% (2015: 24%) 133,938 48,080 Effect of different tax rates in other countries (375) (51,800) Effect of expenses not deductible for tax 58,595 187,670 Income not taxable for tax purpose (203,992) (146,276) Income exempted under pioneer status - 19,310 Deferred tax assets not recognised during the year 50,488 (31,711) Overprovision of tax expense in prior year 27,534 3,827 ---------- ---------- Tax expense for the year 66,188 29,100
As at 31 December 2016, the unrecognised deferred tax assets of the Group are as follows:
Group 2016 2015 GBP GBP Unabsorbed tax losses 1,193 5,283 Unabsorbed capital allowances 8,136 - Taxable temporary difference (9,239) 4,389 Foreign currency translation - - -------- ------ - 9,672 ======== ======
The potential net deferred tax assets amounting to GBP9,329 (2015: GBP9,672) has not been recognised in the financial statements because it is not probable that future taxable profit will be available against which the subsidiary company can utilise the benefits.
The availability of the unused tax losses and unabsorbed capital allowances for offsetting against future taxable profits of the subsidiary company is subject to no substantial changes in shareholdings of the subsidiary company under Section 44(5A) and (5B) of Income Tax Act, 1967.
9. LOSS OF COMPANY
The profit or loss of the Company is not presented as part of these financial statements. The Company's loss for the financial year was GBP92,465 (2015: GBP257,847).
10. EARNINGS PER SHARE Group 2016 2015 GBP GBP Profit/(loss) attributable to owners of the Parent for the computation of basic earnings/(loss) per share Profit from continuing operations 315,352 165,678 Issued ordinary shares at 1 January 106,298,780 106,298,780 Effect of ordinary shares issued - - during the period ------------ ------------ Weighted average number of shares at 31 December 106,298,780 106,298,780 ============ ============ Fully diluted weighted average number of shares at 31 December 116,898,780 116,898,780 ============ ============ Basic Earnings Per Share Continuing operations (pence) 0.297 0.156 Discontinued operations (pence) - - ------------ ------------ 0.396 0.156 ============ ============ Diluted Earnings Per Share Continuing operations (pence) 0.270 0.142 Discontinued operations (pence) - - ------------ ------------ 0.270 0.142 ============ ============
The basic earnings per share is calculated by dividing the profit of GBP315,352 (2015: profit of GBP165,678) attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the year, which is 106,298,780 (2015: 106,298,780).
The diluted earnings per share is calculated using the weighted average number of shares adjusted to assume the exercise of outstanding dilutive share options.
11. INTANGIBLE ASSETS Group Software Goodwill Development Total 31 December 2016 on consolidation costs GBP GBP GBP GBP Cost At 1 January 2016 518,811 1,076,904 962,300 2,558,015 Foreign exchange differences - - - - ---------- ------------------ ------------ ---------- At 31 December 2016 518,811 1,076,904 962,300 2,558,015 ========== ================== ============ ========== Accumulated amortisation and impairment loss At 1 January 2016 518,811 1,076,904 908,009 2,503,724 Amortisation charge for the year - - 54,291 54,291 Impairment loss for - - - - the year Foreign exchange differences ---------- ------------------ ------------ ---------- At 31 December 2016 518,811 1,076,904 962,300 2,558,015 ========== ================== ============ ========== Net Carrying Amount At 31 December 2016 - - - - ========== ================== ============ ========== - 31 December 2015 Cost At 1 January 2015 701,510 1,257,918 962,300 2,921,728 Foreign exchange differences (182,699) (181,014) - (363,713) ---------- ------------------ ------------ ---------- At 31 December 2015 518,811 1,076,904 962,300 2,558,015 ========== ================== ============ ========== Accumulated amortisation and impairment loss At 1 January 2015 701,510 855,692 798,690 2,355,892 Amortisation charge for the year - - 115,449 115,449 Impairment loss for
the year - 366,591 - 366,591 Foreign exchange differences (182,699) (145,379) (6,130) (334,208) ---------- ------------------ ------------ ---------- At 31 December 2015 518,811 1,076,904 908,009 2,503,724 ========== ================== ============ ========== Net Carrying Amount At 31 December 2015 - - 54,291 54,291 ========== ================== ============ ==========
The Group assesses at each reporting date whether there is an indication that an asset may be impaired, by considering the net present value of discounted cash flows forecasts. If an indication exists an impairment review is carried out.
Goodwill on consolidation
(a) Impairment testing for goodwill on consolidation
Goodwill on consolidation has been allocated for impairment testing purposes to the individual entities which is also the cash-generating units ("CGU") identified.
(b) Key assumptions used to determine recoverable amount
The recoverable amount of a CGU is determined based on value in use calculations using cash flow projections based on financial budgets approved by the Directors covering 5 years period. The projections are based on the assumption that the Group can recognise projected sales which grow at 10% per annum which is based on expected clientele over time. A prudent approach has been applied with no residual value being factored into these calculations. If the projected sales do not materialise there is a risk that the total value of the intangible assets shown above would be impaired. A pre-tax discount rate of 8.50% per annum was applied to the cash flow projections, after taking into consideration the Group's cost of borrowings, the expected rate of return and various risks relating to the CGU. The directors have relied on past experience and all external evidence available in determining the assumptions.
During the financial year, the Group impairment loss amounting to NIL (2015: GBP366,591) in respect of the goodwill on consolidation. A significant proportion of goodwill on consolidation relates to the acquisition of Netoss Sdn. Bhd. which is a CGU and has a carrying amount of NIL (2015: NIL). Its recoverable amount has been determined based on value in use using cash flow projections and key assumptions as described in (b) above.
Development costs
Development costs will not be amortised if the product is still in its development phase. The amortisation of the development costs is over 5 years period, which in the opinion of the Directors is adequate.
12. PROPERTY, PLANT AND EQUIPMENT Building Motor Leasehold Electronic Computer Computer Furniture Office Renovation Group vehicles improvement Data equipment software and equipment Capture fittings Total equipment 31 December GBP GBP GBP GBP GBP GBP GBP GBP GBP GBP 2016 COST At 1 January 2016 336,158 189,160 9,532 152,220 212,794 31,347 71,625 30,082 61,883 1,094,801 Additions - - - 5,140 15,933 183 1,042 1,573 - 23,871 Written off (531) (531) Foreign exchange differences 51,745 29,118 1,335 23,432 32,585 4,825 11,023 4,631 9,525 168,219 ---------- ---------- At 31 December 2016 387,903 218,278 10,867 180,792 260,781 36,355 83,690 36,286 71,408 1,286,360 ---------- ---------- DEPRECIATION At 1 January 2016 8,215 147,910 2,581 130,481 175,816 21,249 52,892 22,972 35,118 597,234 Depreciation charge for the year 6,640 20,182 1,031 31,753 15,889 2,329 5,013 1,573 4,198 88,608 Written off Foreign exchange differences 7,119 23,121 (5,399) 20,641 27,257 3,312 8,244 3,592 5,480 93,367 ---------- ---------- At 31 December 2016 21,974 191,213 (1,787) 182,875 218,962 26,890 66,149 28,137 44,796 779,209 ---------- ---------- NET CARRYING AMOUNT At 31 December 2016 365,929 27,065 12,654 (2,083) 41,819 9,465 17,541 8,149 26,612 507,151 ========== ========== ============= =========== =========== ========== =========== =========== ============ ========== Building Motor Leasehold Electronic Computer Computer Furniture Office Renovation Group vehicles improvement Data equipment software and equipment Capture fittings Total equipment 31 December GBP GBP GBP GBP GBP GBP GBP GBP GBP GBP 2015 COST At 1 January 2015 330,765 220,955 9,494 177,807 218,798 36,615 77,090 30,178 47,181 1,148,883 Additions 52,989 - - - 23,666 - 8,797 4,247 21,492 111,191 Written off - - - - - - (3,716) - - (3,716) Foreign exchange differences (47,596) (31,795) 38 (25,587) (29,670) (5,268) (10,546) (4,343) (6,790) (161,557) ---------- ---------- At 31 December 2015 336,158 189,160 9,532 152,220 212,794 31,347 71,625 30,082 61,883 1,094,801 ---------- ---------- DEPRECIATION At 1 January 2015 2,756 151,693 1,621 104,884 187,730 21,918 56,225 23,809 35,313 585,949 Depreciation charge for the year 6,233 19,211 1,623 43,318 15,164 2,646 8,594 2,757 5,203 104,749 Written off Foreign exchange differences (774) (22,994) (663) (17,721) (27,078) (3,315) (11,927) (3,594) (5,398) (93,464) ---------- ---------- At 31 December 2015 8,215 147,910 2,581 130,481 175,816 21,249 52,892 22,972 35,118 597,234 ---------- ---------- NET CARRYING AMOUNT At 31 December 2015 327,943 41,250 6,951 21,739 36,978 10,098 18,733 7,110 26,765 497,567 ========== ========== ============= =========== =========== ========== =========== =========== ============ ==========
(a) Cash payments of GBP23,871 (2015: GBP111,191) were made by the Group to purchase property, plant and equipment.
(b) Included in property, plant and equipment of the Group are motor vehicles with net carrying amounts of GBP27,065 (2015: GBP41,250) held under finance leases arrangements.
13. INVESTMENT IN SUBSIDIARY COMPANIES Company 2016 2015 GBP GBP COST At 1 January 1,976,338 1,976,338 Less: Impairment loss during the financial year - - ---------- ---------- At 31 December 1,976,338 1,976,338 ========== ===========
Details of the subsidiary companies are as follows:
Effective Ownership of Ordinary Shares Name of Subsidiary Country Interest Principal Activities of ** Companies Incorporation 2016 2015 % % Provision of e-Channel products and services, technology managed services and MobilityOne solution sales Sdn. Bhd. Malaysia 100 100 and consultancy Direct subsidiary companies of MobilityOne Sdn. Bhd. Provision of
Netoss Sdn. solution sales Bhd. Malaysia 100 100 and services MobilityOne Ventures Sdn. Bhd. Malaysia 100 100 Dormant
Details of the subsidiary companies are as follows: (Continued)
Effective Ownership of Ordinary Shares Name of Subsidiary Country Interest Principal Activities of ** Companies Incorporation 2016 2015 % % Direct subsidiary companies of MobilityOne Sdn. Bhd. (Continued) Provision of IT systems and solutions and to establish MobilityOne a multi-channel Philippines, electronic service Inc* Philippines 95 95 bureau Provision of One Tranzact electronic payment Sdn. Bhd. Malaysia 100 100 and product fulfillment * Audited by firm of auditors other than UHY. ** All the above subsidiary undertakings are included in the consolidated financial statements. 14. INVENTORIES Group 2016 2015 GBP GBP At lower of cost and net realisable value: Airtime 1,101,772 1,063,008 ========== ========== 15. INVESMENT IN ASSOCIATE COMPANY
During the financial year, the Company acquired 50% of the issued and paid-up share capital of Unique Change Sdn. Bhd.
Country Effective Principal Name of Company of Interest Activities Incorporation 2016 2015 Unique Change Malaysia 50% - Provider for Sdn. Bhd. International remittance services
The associate company is not material individually to the financial position, financial performance and cash flows of the Group.
16. TRADE AND OTHER RECEIVABLES Group Company 2016 2015 2016 2015 GBP GBP GBP GBP Trade receivables * Third parties 2,024,291 2,697,809 - - Other receivables * Deposits 281,969 31,684 - - * Prepayments 3,838 70,237 - - * Sundry receivables 609,110 548,058 - - 3,791 - - - * Staff advances * Amount due from subsidiary company - - 1,068,386 536,982 ------------ ------------ ------------ ---------- 898,708 649,979 1,068,386 536,982 Total trade and other receivables 2,922,999 3,347,788 1,068,386 536,982
(a) The Group's and the Company's normal trade credit terms range from 30 to 60 days (2015: 30 to 60 days). Other credit terms are assessed and approved on a case to case basis.
Ageing analysis
An ageing analysis of trade receivables that are neither individually nor collectively considered to be impaired is as follows:
Group 2016 2015 GBP GBP Neither past due nor impaired 1,448,176 1,048,743 ---------- ---------- 1 to 2 months past due 1,116,372 737,550 3 to 12 months past due (540,256) 911,516 ---------- ---------- 576,116 1,649,066 ---------- ---------- 2,024,292 2,697,809 ========== ==========
(a) The Group's and the Company's normal trade credit terms range from 30 to 60 days (2015: 30 to 60 days). Other credit terms are assessed and approved on a case to case basis.
Receivables that were neither past due nor impaired relate to a wide range of customers for whom there was no recent history of default.
Receivables that were past due but not impaired relate to a number of independent customers that have a good track record with the Group. Based on past experience, management believes that no impairment allowance is necessary in respect of these balances as there has not been a significant change in credit quality and the balances are still considered fully recoverable.
(b) Related party balances
The amount due from subsidiary companies is unsecured, non-interest bearing and is repayable on demand.
17. CASH AND CASH EQUIVALENTS Group Company 2016 2015 2016 2015 GBP GBP GBP GBP Cash in hand and at banks 527,964 936,529 2,010 2,018 Fixed deposits with licensed bank 1,590,201 1,280,186 - - ------------ ------------ ------ ------ Cash and bank balances 2,118,165 2,216,715 2,010 2,018 Less : Bank overdraft (Note 23) (162,895) - - - Cash and cash equivalents 1,955,270 2,216,715 2,010 2,018
(a) The above fixed deposits have been pledged to licensed banks as securities for credit facilities granted to the Group as disclosed in Note 23 to the financial statements.
(b) The Group's effective interest rates and maturities of deposits are range from 2.95% - 3.20% (2015: 2.95% - 3.20%) and from 1 month to 12 months (2015: 1 month to 12 months) respectively.
18. CALLED UP SHARE CAPITAL Number of ordinary shares of GBP0.025 Amount each 2016 2015 2016 2015 GBP GBP Authorised in MobilityOne Limited At 1 January/31 December 400,000,000 400,000,000 10,000,000 10,000,000 ============ ============ =========== =========== Issued and fully paid in MobilityOne Limited At 1 January 106,298,780 106,298,780 2,657,470 2,657,470 At 31 December 106,298,780 106,298,780 2,657,470 2,657,470 ============ ============ =========== =========== 19. COMPANY EQUITY INSTRUMENTS Share Share Retained capital premium earnings Total GBP GBP GBP GBP At 1 January 2016 2,657,470 909,472 (1,185,189) 2,381,753 Loss for the year - - (92,465) (92,465) ---------- --------- ------------- ---------- At 31 December 2016 2,657,470 909,472 (1,277,654) 2,289,288 ========== ========= ============= ========== Share Share Retained capital premium earnings Total GBP GBP GBP GBP At 1 January 2015 2,657,470 909,472 (927,342) 2,639,600 Loss for the year - - (257,847) (257,847) ---------- --------- ------------- ---------- At 31 December 2015 2,657,470 909,472 (1,185,189) 2,381,753 ========== ========= ============= ========== 20. REVERSE ACQUISITION RESERVE
The acquisition of MobilityOne Sdn. Bhd. by MobilityOne Limited, which was affected through a share exchange, was completed on 5 July 2007 and resulted in MobilityOne Sdn. Bhd. becoming a wholly owned subsidiary of MobilityOne Limited. Pursuant to a share swap agreement dated 22 June 2007 the entire issued and paid-up share capital of MobilityOne Sdn. Bhd. was transferred to MobilityOne Limited by its owners. The consideration to the owners was the transfer of 178,800,024 existing ordinary shares and the allotment and issuance by MobilityOne Limited to the owners of 81,637,200 ordinary shares of 2.5p each. The acquisition was completed on 5 July 2007. Total cost of investment by MobilityOne Limited is GBP2,040,930, the difference between cost of investment and MobilityOne Sdn. Bhd. share capital of GBP708,951 has been treated as a reverse acquisition reserve.
21. FOREIGN CURRENCY TRANSLATION RESERVE
The subsidiary companies' assets and liabilities stated in the Statement of Financial Position were translated into Sterling Pound (GBP) using the closing rate as at the Statement of Financial Position date and the Income Statements were translated into GBP using the average rate for that period. All resulting exchange differences are taken to the foreign currency translation reserve within equity.
2016 2015 GBP GBP At 1 January 689,246 793,863 Currency translation differences during the year 105,101 (104,617) At 31 December 794,347 689,246 ======== ==========
The foreign currency translation reserve is used to record exchange differences arising from the translation of the financial statements of foreign operations whose functional currencies are different from that of the Group's presentation currency. It is also used to record the exchange differences arising from monetary items which form part of the Group's net investment in foreign operations, where the monetary item is denominated in either the functional currency of the reporting entity or the foreign operation.
22. RETAINED EARNINGS
Retained earnings represents the cumulative earnings of the Group attributable to equity shareholders.
Group Company 2016 2015 2016 2015 GBP GBP GBP GBP At 1 January (3,701,797) (3,867,475) (1,185,189) (927,342) Profit/(loss) for the year 315,352 165,678 (92,465) (257,847) At 31 December (3,386,445) (3,701,797) (1,277,654) (1,185,189) ============ ============ ============ ============ 23. FINANCIAL LIABILITIES - LOANS AND BORROWINGS Group 2016 2015 Non-current GBP GBP Secured: Finance lease payables (Note 24) 44,698 50,538 Term loan 279,028 246,154 323,726 296,692 ========== ========== Current Secured: Bankers' acceptance 2,297,268 1,533,322 Finance lease payables (Note 24) 13,619 43,741 Term loan 5,449 4,540 2,316,336 1,581,603 ========== ========== Total Borrowings Secured: Bankers' acceptance 2,297,268 1,533,322 Finance lease payables (Note 24) 58,317 94,279 Term loan 284,477 250,694 2,640,062 1,878,295 ========== ==========
The bankers' acceptance and bank overdraft secured by the following:
(a) pledged of fixed deposits of a subsidiary company (Note 17); (b) personal guarantee by Dato' Hussian @ Rizal bin A. Rahm, a Director of the Company; and (c) corporate guarantee by the Company.
The term loan is secured by the following:
(a) Charge over the Company's building (Note 12); and
(b) joint and several guaranteed by Dato' Hussian @ Rizal bin A. Rahman and Derrick Chia Kah Wai, the Directors of the Company.
The effective interest rates of the Group for the above facilities other than finance leases are as follows:
Group 2016 2015 % % Bankers' acceptance 6.6-6.9 6.5-6.9 Bank overdraft 8.85 8.85 Term loan 4.60 4.60
The maturity of borrowings (excluding finance leases) is as follows:
Group 2016 2015 GBP GBP Within one year 2,465,612 1,533,322 Between one to two years 6,092 17,173 Between two to three years 14,109 51,518 Between three and four years - - Between four to five years - - More than five years 258,827 182,003 2,744,640 1,784,016
Other information on financial risks of borrowings are disclosed in Note 3.
24. FINANCE LEASE PAYABLES Group 2016 2015 GBP GBP Minimum lease payments: Not later than 1 year 15,946 46,887 Later than 1 year but not later than 2 years 15,753 13,819 Later than 2 years but not later than 5 years 20,538 23,596 Later than 5 years 12,167 18,398 -------- -------- 64,404 102,700 Less: Future finance charges (6,087) (8,421) -------- -------- Present value of finance lease liabilities 58,317 94,279 ======== ======== Present value of minimum lease payments: Not later than 1 year 13,619 43,741 Later than 1 year but not later than 2 years 14,103 11,803 Later than 2 years but not later than 5 years 27,056 28,503 Later than 5 years 3,539 10,232 58,317 94,279 ======== ======== Analysed as: Due within 12 months (Note 20) 13,619 43,741 Due after 12 months (Note 20) 44,698 50,538 -------- -------- 58,317 94,279 ======== ========
The Group has finance lease contracts for certain motor vehicles as disclosed on Note 12(b).
Other information on financial risks of finance lease payables are disclosed in Note 3.
25. TRADE AND OTHER PAYABLES Group Company 2016 2015 2016 2015 GBP GBP GBP GBP Trade payables * Third parties 81,334 157,856 - - Other payables * Deposits 46,143 62,548 - - * Accruals 969,583 1,949,383 1,155 - * Sundry payables 1,004,169 1,757,981 645,356 20,490 2,019,895 3,769,912 646,511 20,490 Total trade and other payables 2,101,229 3,927,768 646,511 20,490 Add: Amount due to Directors (Note 26) 113,501 118,603 110,935 113,095 Add: Loans and borrowings (Note 23) 2,802,956 1,878,295 - - Total financial liabilities carried at amortised costs 5,017,686 5,924,666 757,446 133,585 (a) The Group's normal trade credit terms range from 30 to 90 days (2015: 30 to 90 days).
(b) Other payables are non-interest bearing. Other payables are normally settled on an average terms of 60 days (2015: 60 days).
26. AMOUNT DUE TO DIRECTORS Group Company 2016 2015 2016 2015 GBP GBP GBP GBP Dato' Hussian @ Rizal bin A. Rahman 40,301 82,977 37,735 77,469 Derrick Chia Kah Wai 30,600 14,813 30,600 14,813 Seah Boon Chin 42,600 20,813 42,600 20,813 113,501 118,603 110,935 113,095
These are unsecured, interest free and repayable on demand.
27. RECONCILIATION OF PROFIT BEFORE TAX TO CASH GENERATED FROM OPERATIONS Group 2016 2015 GBP GBP Cash flow from operating activities Profit before tax * Continuing 381,165 192,320 * Discontinued operation - - ------------ ------------ 381,165 192,320 ------------ ------------ Adjustments for: Depreciation of property, plant and equipment - 104,749 Amortisation of intangible assets - - Amortisation of development costs 54,291 115,449 Property, plant and equipment written off 88,608 3,716 Impairment loss on goodwill - 366,591 Interest expenses 176,279 153,286 Inventories written off 1,701 Interest income (46,872) (51,395) ------------ ------------ Operating profit before working capital changes 655,172 884,716 (Increase)/Decrease in inventories (40,465) (517,210) Increase in receivables 424,789 (1,024,537) Increase/(Decrease) in amount due to Directors (5,102) 45,180 (Decrease)/Increase in payables (1,826,539) 2,584,575 Cash generated from/(used in) operations (792,145) 1,972,724 Company 2016 2015 GBP GBP Cash flow from operating activities Loss before tax (92,465) (257,847) (Increase)/ in trade and other receivable (531,404) - Increase/(Decrease) in payables 626,021 (8,600) Increase/(Decrease) in amount due to Directors (2,160) 46,366 Decrease in amount due from subsidiary company - 220,081 ------------ ------------ Cash depleted in operations (8) - 28. RELATED PARTY TRANSACTIONS
At the Statement of Financial Position date, the Group owed the Directors GBP2,566 (2015: GBP118,603), the Company owed the Directors GBP109,200 (2015: GBP113,095), MobilityOne Sdn. Bhd. owed the Company GBP448,685 (2015: GBP393,418), Netoss Sdn. Bhd. owed MobilityOne Sdn. Bhd. GBP819,715 (2015: GBP493,000), MobilityOne Ventures Sdn .Bhd. owed MobilityOne Sdn. Bhd. GBP6,130 (2015: GBP4,725) and MobilityOne Sdn. Bhd. owed One Trazact Sdn. Bhd. GBP616,215 (2015: GBP82,674), and Netoss Sdn. Bhd. owed LMS Technology Distribution Sdn. Bhd., a company related to a Director, GBP14,831 (2015: NIL). The amounts owing to or from the subsidiary companies and related parties are repayable on demand and are interest free.
29. ULTIMATE CONTROLLING PARTY
In the opinion of the Directors, as at 31 December 2016, the ultimate controlling party in the Company is Dato's Hussain @ Rizal bin A. Rahman by virtue of his shareholding.
30. CONTINGENT LIABILITIES
Save as disclosed below, the Group has no contingent liabilities arising in respect of legal claims arising from the ordinary course of business and it is not anticipated that any material liabilities will arise from the contingent liabilities other than those provided for.
Group 2016 2015 GBP GBP Limited of guarantees Corporate guarantee given to a licensed bank by the Company for credit facilities granted to a subsidiary company 2,460,162 4,377,560 Amount utilised Banker's guarantees in favour of third parties 55,041 890,595 31. SHARE BASED PAYMENTS
During the year ended 31 December 2016, the Company did not grant any new share option to directors and employees of the Group. No charge was made for the share options of 10,600,000 shares in 2014 as it was not considered to be material.
The fair value of the share options granted in 2014 was calculated using Black-Scholes model assuming the inputs shown below:
Grant date 5 December 2014 Share price at grant date 1.5p Exercise price 2.5p Option life in years 10 years Risk free rate 4.24% Expected volatility 40% Expected dividend yield 0% Fair value of options 1p
No option has been exercised or lapsed.
32. SUBSEQUENT EVENTS
On 10 April 2017, the wholly-owned subsidiary, MobilityOne Malaysia signed a partnership agreement with Mobility i Tap Pay (Bangladesh) Limited and on 26 June 2017 MobilityOne Malaysia obtained approval from the Central Bank of Malaysia to issue e-Money for general retail purposes via prepaid card or mobile applications. Refer to the Chairman's Statement on page 2 of these financial statements for further details.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR OKKDBQBKDPAN
(END) Dow Jones Newswires
June 30, 2017 10:31 ET (14:31 GMT)
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