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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Aseana Properties Limited | LSE:ASPL | London | Ordinary Share | JE00B1RZDJ41 | ORD USD0.05 |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 0.12 | 0.11 | 0.13 | 0.12 | 0.115 | 0.115 | 0.00 | 08:00:03 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Real Estate Agents & Mgrs | 11.95M | -15.87M | -0.0799 | -1.50 | 23.84M |
From May 2019 to May 2024
TIDMASPL
RNS Number : 2855Z
Aseana Properties Limited
31 August 2018
31 August 2018
Aseana Properties Limited
("Aseana", the "Company" or, the "Group")
Half-Year Results for the Six Months Ended 30 June 2018
Aseana Properties Limited (LSE: ASPL), a property developer investing in Malaysia and Vietnam, listed on the Main Market of the London Stock Exchange, announces its unaudited half-year results for the six-month period ended 30 June 2018.
Operational highlights:
-- On 23 April 2018, Aseana announced that at the General Meeting, shareholders approved the continuation of the Company to December 2019 and also approved the amendment of the Management Agreement to adopt a revised fee structure. The revised fee structure better aligns the Manager's interests with those of shareholders by incentivising the Manager to maximise sales proceeds and achieve the current disposal schedule for realisation of the Company's remaining assets.
-- On 26 June 2018, the Manager entered into an agreement to divest a plot of land ("PT2 land") at International Healthcare Park ("IHP") for a consideration of VND150.0 billion (approximately US$6.6 million). The completion of this transaction is subject to regulatory approval being obtained from local authorities.
-- During the period under review, three units were sold at SENI Mont' Kiara ("SENI"); only one penthouse remains available for sale.
Hot Features
Premium
-- The Harbour Mall Sandakan ("HMS") has achieved an occupancy of 72% to date.
-- Four Points by Sheraton Sandakan Hotel ("FPSS") achieved an average occupancy rate of approximately 37% for the period to 30 June 2018 and 40% to date.
-- The RuMa Hotel and Residences ("The RuMa") has achieved approximately 56% sales based on sale and purchase agreements signed.
-- The City International Hospital ("CIH") has shown improvement in its operational performance, with both outpatient and inpatient volumes increasing by approximately 30% as compared to same period in 2017.
Financial highlights:
-- The Group adopted International Accounting Standard IFRS 15 Revenue from Contracts with Customers with a date of initial application of 1 Jan 2018. As a result, the Group changed its accounting policy for revenue recognition. The Group applied IFRS 15 by recognising the cumulative effect of initially applying IFRS 15 as an adjustment to the opening balance of equity as at 1 January 2017. Adjustments to revenue are made for property development activities of serviced residences for The RuMa, where no revenue was previously recognised under IFRIC 15 - Agreements for Construction of Real Estate, which prescribes that revenue be recognised only when the properties are completed and occupancy permits are issued (see note 2 and note 13).
-- Revenue of US$15.9 million for the six-month period ended 30 June 2018 (H1 2017 (restated): US$17.1 million)
-- Loss before tax for the six-month period ended 30 June 2018 of US$4.1 million (H1 2017 (restated): profit of US$0.2 million)
-- Loss after tax for the six-month period ended 30 June 2018 of US$4.6 million (H1 2017 (restated): loss of US$0.7 million)
-- Consolidated comprehensive loss of US$4.8 million for the six-month period ended 30 June 2018 (H1 2017 (restated): income of US$4.3 million)
-- Net asset value of US$138.9 million at 30 June 2018 (31 December 2017 (unaudited) (restated): US$142.3 million) or US$0.699 per share (31 December 2017 (unaudited) (restated): US$0.716 per share)
-- Realisable net asset value of US$183.1 million at 30 June 2018 (31 December 2017 (unaudited) (restated): US$182.0 million) or US$0.922 per share (31 December 2017(unaudited) (restated): US$0.916 per share)
Commenting on the results, Mohammed Azlan Hashim, Chairman of Aseana, said:
"The Board and the Manager remain committed to ensuring that the remaining assets of the Company are realised with optimum values in a timely manner. Although no major asset sales were recorded during the first half of the year, further progress has been made in the sale of the remaining units at SENI Mont' Kiara and the Manager has also entered into an agreement to dispose of a plot of land at IHP. Nevertheless, the Board and the Manager remain focused to ensure the Group's portfolio progresses with the recovery and growth of the economy in Malaysia and Vietnam."
The Group has also published its Quarterly Investment Update (including updates on projects and RNAV figures) for the period to 30 June 2018, which can be obtained on its website at www.aseanaproperties.com/quarterly.htm.
For further information:
Aseana Properties Limited Tel: 00 603 6411 6388 Chan Chee Kian Email: cheekian.chan@ireka.com.my N+1 Singer Tel: 020 7496 3000 James Maxwell / James Moat (Corporate Finance) Sam Greatrex (Sales) Tavistock Tel: 020 7920 3150 Jeremy Carey / Kirsty Allan Email: jeremy.carey@tavistock.co.uk
Notes to Editors:
London-listed Aseana Properties Limited (LSE: ASPL) is a property developer with investments in Malaysia and Vietnam.
Ireka Development Management Sdn Bhd ("IDM") is the exclusive Development Manager for Aseana. It is a wholly-owned subsidiary of Ireka Corporation Berhad, a company listed on the Bursa Malaysia since 1993, which has over 51 years' experience in construction and property development. IDM is responsible for the day-to-day management of Aseana's property portfolio and the divestment of existing properties.
CHAIRMAN'S STATEMENT
Introduction
I am pleased to report on the half-year results for Aseana Properties and its group of companies for the six months ended 30 June 2018.
The global economy has been volatile throughout the first half of 2018. Trade tensions between the US and China remain the primary reason for the market instability. However, oil prices have been on an upward trend in 2018 as a result of restrictions in oil production, bringing it to its highest price since 2014. This bodes well for Malaysia as an oil exporting nation, mitigating some of the global economic risk.
The Malaysian economy has remained buoyant in the first half of 2018 despite growth being recorded at a slower pace compared to the same period last year. The 14(th) General Election ("GE14") which took place on 9 May 2018 has caused uncertainties in the nation's economic policies. Investor confidence was shaken following the announcement by the new government that the national debt amounts to US$1 trillion. However, the government is positive that foreign investment will return once it has announced new economic policies and measures in the short-term. Consumer spending is expected to increase following the abolition of the Goods and Services Tax ("GST") on 1 June 2018 and the reintroduction of the Sales and Services Tax ("SST") from September 2018. In a bid to bring down the debt level, the government is reviewing mega infrastructure projects such as the Kuala Lumpur-Singapore High Speed Rail, the Klang Valley Mass Rapid Transit Line 3 and the East-Coast Rail Link. To date, the implementation of these projects has been put on hold until further notice. These government initiatives are expected to maintain Malaysia's positive economic growth trajectory.
Meanwhile, economic growth in Vietnam remains strong with second quarter Gross Domestic Product ("GDP") growth of 6.79%, bringing the total GDP growth to 7.08% for the first half of 2018. Among the fastest-growing economies in the world, Vietnam has been propelled by thriving exports, a surge in Foreign Direct Investment (FDI) and a buoyant tourism sector. However, it is expected that the country's economy may slow down amid rising trade tensions between the world's two economic powerhouses coupled with the easing in China's growth. In addition, discontent among Vietnamese citizens is also on the rise due to the proposed special economic zone for Chinese businesses, as well as the cyber security legislation that is believed to be restricting online freedom.
Results
For the six months ended 30 June 2018, the Group recorded unaudited revenue of US$15.9 million (H1 2017 (restated): US$17.1 million), which was attributable to the sale of completed units in SENI Mont' Kiara of US$4.3 million and adjustments to revenue for sale of residences in The RuMa of US$11.6 million, upon the adoption of International Accounting Standard IFRS 15 with effect from 1 January 2018. Previously, the Group adopted IFRIC 15 - Agreements for Construction of Real Estate which prescribes that revenue be recognised only when the properties are completed and occupancy permits are issued. No major asset sales were recorded during this period.
The Group recorded an unaudited loss before tax for the period of US$4.1 million (H1 2017 (restated): profit of US$0.2 million), mainly due to operating losses and financing costs of US$2.1 million for City International Hospital, US$0.8 million for Four Points by Sheraton Sandakan Hotel and Harbour Mall Sandakan, and pre-opening losses of US$1.4 million for The RuMa Hotel.
The Group's unaudited loss after tax for the six-months ended 30 June 2018 stood at US$4.6 million (H1 2017 (restated): loss of US$0.7 million). The Group's unaudited consolidated comprehensive loss for the period of US$4.8 million (H1 2017 (restated): income of US$4.3 million) has included a foreign currency translation loss of US$0.1 million (H1 2017 (restated): gain of US$5.0 million).
Unaudited net asset value for the Group for the six-months ended 30 June 2018 decreased to US$138.9 million (31 December 2017 (unaudited) (restated): US$142.3 million) due to losses incurred during the period. The unaudited net asset value for the Group translates to US$0.699 per voting share (31 December 2017 (unaudited) (restated): US$0.716 per voting share). Meanwhile, unaudited realisable net asset value for the Group stood at US$183.1 million as at 30 June 2018 (31 December 2017 (unaudited) (restated): US$182.0 million). This is equivalent to US$0.922 per voting share (31 December 2017 (unaudited) (restated): US$0.916 per voting share).
Review of Activities and Property Portfolio
Sales status (based on Sales and Purchase agreements signed):
Projects % sales % sales as
as at at
15 August 31 December
2018 2017
-------------------------------- ----------- -------------
SENI Mont' Kiara
* proceeds received 98.9% 98.2%
* pending completion 1.0% 1.00%
The RuMa Hotel and Residences 56.0% 56.9%
-------------------------------- ----------- -------------
Malaysia
The property market remains weak in the wake of the formation of a new government after the defeat of the previous coalition government who has ruled for over 60 years. Uncertainties in the global and local economic conditions added to the lacklustre performance of the property market in Malaysia. The sale of properties at The RuMa is slow and registered sales have dropped slightly to 56.0% due to termination of a few contracted sales by the developer due to payment default of the buyers. Construction is expected to complete by September 2018 followed by immediate handover of units to buyers. The RuMa Hotel is expected to commence operation in October 2018. The Manager continues to actively market the balance of unsold units to potential buyers in Singapore, Taiwan and Hong Kong.
Sabah experienced an increase in the number of tourists in the first six months of 2018 compared to the same period in 2017. Sabah had a total of 1.89 million international and Malaysian tourists from January to June of 2018, with those from China being Sabah's largest group of visitors, with a total of 300,103. However, travel outside of Kota Kinabalu, the capital of Sabah, is still affected by adverse travel advisory notices for eastern Sabah from countries such as Australia, New Zealand, Canada and the United Kingdom. These continue to place a negative effect to the performance of FPSS. Occupancy at FPSS for the first six months of the year stood at 37% while occupancy at HMS stands at 72% to date.
Vietnam
CIH's performance has shown encouraging improvements to date. The operation of the angiographic intervention services which commenced in April has brought commendable improvements to the overall patient volume of the hospital. As at 30 June 2018, CIH had registered 6,612 in-patient days (30 June 2017: 4,970), equivalent to a daily average of 37 in-patient days (30 June 2017: 27.46), with average revenue per in-patient day of US$458 (30 June 2017: US$390). Outpatients visits as at 30 June 2018 had reached 31,230 visits (30 June 2017: 23,685), equivalent to an average of 234 outpatients daily (30 June 2017: 177), which generated average revenue per visit of US$78.5 (30 June 2017: US$74.0).
Divestment Update
The Directors have previously highlighted the impact of difficult prevailing property market conditions in both Malaysia and Vietnam on the speed of asset disposals.
Despite a general improvement in sentiment, the Malaysian property market remains soft and is in a period of adjustment following the nation's General Election on 9 May 2018, which resulted in a change of government formed by a new coalition of political parties. This represents a watershed moment for Malaysia, having been ruled by the same coalition government since it gained independence in 1957. As a result, in the short term, investors, especially overseas investors, are still adopting a "wait-and-see" approach over the outlook for the property market.
On the Seafront Resort and Residential Development, Kota Kinabalu, discussion with the China-based buyer is at advanced stage. Meanwhile, the Development Manager has also initiated discussion with a Singapore based property developer.
In Vietnam, whilst the economy continues to grow at a robust pace with inflation remaining in check, the anti-China protests in June 2018, sparked by the designation of special economic zones with long land leases, has created renewed uncertainties among Chinese investors looking to invest in Vietnam.
On the progress of disposal, discussions with the China-based healthcare group and the Vietnam-based healthcare investor are still on-going.
Separately, the Manager entered into an agreement on 26 June 2018 to divest a plot of land at the International Healthcare Park (Lot PT2, Vietnam) for a consideration of approximately VND150.0 billion (approximately US$6.6 million). The completion of this transaction is subject to regulatory approval being obtained from local authorities.
On 3 July 2018, the Board of Directors released an announcement highlighting the revised disposal schedule for the Company's remaining assets. While discussions are still on-going for City International Hospital and Seafront Resort and Residential Development, Kota Kinabalu, current market conditions have meant that the Company has been unable to achieve its original target of selling by June 2018 and has therefore provided a revised timeline for the sale to take place in Q4 2018.
MOHAMMED AZLAN HASHIM
Chairman
31 August 2018
DEVELOPMENT MANAGER'S REVIEW
Malaysia Economic Update
The Malaysian economy remained resilient on the back of solid fundamentals despite the growing need to improve on its current fiscal condition. Growth is expected to trend lower, compared to the robust growth recorded last year, due to uncertainties over economic policies introduced by the new government. Malaysia's GDP grew at 4.5 % for the second quarter of 2018 and 4.9% for the first half of 2018 respectively. Despite moderated growth, the pace of growth remains sturdy as domestic market continues to be the key economic driver coupled with positive spill overs from the external sector. In addition, GDP growth has been supported by private consumption on the back of improving consumer sentiment following the announcement of the abolition of the Goods and Services Tax and the introduction of fuel subsidies by the new government. Standard & Poor's and Fitch Ratings have reaffirmed Malaysia's sovereign credit rating at investment-grade A-, while Moody's rated Malaysia at A3 with stable outlook, indicating robust external position and above-average growth performance which mitigate risks inherent from uplifted debt burden and unstable fiscal policy due to ongoing political transition. Meanwhile, the Ringgit depreciated against the US Dollar by 4.57% to RM4.04/US$1.00 in Q2 2018 due to weakened international investors' sentiment arising from the uncertain local political climate.
Malaysia's central bank, Bank Negara Malaysia left its benchmark interest rate unchanged at 3.25% in its first policy meeting under a new governor in July 2018. This is on the back of sustained positive growth driven by both domestic and external demand despite overhang uncertainties such as the implications of the GE14 in May. In addition, the GST abolishment, which became effective on 1 June 2018 is seen to be providing a boost to private consumption in the short term until the Sales and Services Tax is introduced on 1 September 2018 at 10% and 6% respectively. In tandem with the GST abolishment and the government's measure to cut back on spending to rein in government's debt, the nation's inflation outlook is expected to remain benign underpinned by sustained domestic demand. According to the Department of Statistics Malaysia, Malaysia's Consumer Price Index ("CPI") which measures inflation, grew 0.8% year-on-year in June, the lowest in 40 months following the GST abolishment as well as discounted prices by retailers and price control due to the festive period.
Against the nation's positive domestic economic outlook and upbeat labour market, Malaysian consumer confidence escalated to its highest level in 21 years in the second quarter of 2018. The Malaysian Consumer Sentiment Index rebounded above the 100-point optimism threshold to reach 132.9 points, the highest level since Q2 1997. Consumers' optimism has been underpinned by the recent change in the country's political landscape, GST abolishment and the consumers' expectations of an improvement in the economic welfare. Similarly, businesses have also been bullish on the economy in Q2 2018 as evidenced by the strong rebound in the Malaysian Business Conditions Index ("BCI"). BCI in the second quarter of the year reached 116.3 points, the highest level over the last 13 quarters, driven primarily by new domestic orders, higher investments and higher expected production and export sales in the coming months.
Malaysia has been one of the main beneficiaries of inward Foreign Direct Investment ("FDI") in the region. Malaysia's FDI in 2018 is expected to remain moderate in tandem with the escalating global trade tensions and the uncertainties surrounding the policy reforms under the new government. While businesses have shown more positive confidence following the results of the GE14, efforts to address the fiscal position of the country, such as the review of several landmark infrastructure projects namely the East-Coast Rail Link, the Kuala Lumpur-Singapore High Speed Rail and the Klang Valley Mass Rapid Transit Line 3, coupled with the change in tax regime, may dampen investors' confidence in the short-term. Nevertheless, on-going reforms coupled with the right policies will steer the nation's economy in the right direction and will lead to an overall improvement in the investment climate over the medium to long-term.
Overview of Property Market in Klang Valley, Malaysia
Offices
* One new office building: (i) Tower 6 @ SkyPark,
Cyberjaya was completed in Q2 2018, increasing the
total supply of office space in the Klang Valley by
0.178 million sq ft to 119.456 million sq ft. Overall
occupancy rate remained stable in Q2 2018 at 77% (Q1
2018: 77%).
* Market rentals declined marginally by 0.7% q-o-q,
whilst market prices remained stable in all
submarkets. Rental yields remained between 5.5% and
8.0%.
* En-bloc transactions during the quarter: (i) Wisma
UOA Pantai @ Off Jalan Pantai Baharu (Secondary A
5-storeys) was sold at RM120.0 million (US$30.4
million) or RM727 psf (US$184 psf).
* 13.332 million sq. ft. of office spaces are expected
to be completed within the next two years. Office
sector will continue to remain slow due to supply
demand imbalance and weak market sentiment.
Retail
* Market prices and market rentals for retail centres
in Klang Valley were generally stable in Q2 2018 and
short-term market prospect remained lacklustre.
* One new retail centre was completed during Q2 2018:
(i) DirectD Digital Mall, Jalan Avenue 1A, Kajang,
increasing the total supply of retail centre by 0.039
million sq ft to 67.23 million sq ft.
* Average occupancy rate in Klang Valley increased
marginally by 0.5% to 76.8% in Q2 2018 (Q1 2018:
76.3%).
* No retail centres transactions recorded during the
quarter.
Residential
* 19 projects with 10,798 units of condominium in Klang
Valley were completed in Q2 2018.
* 14 projects with 6,102 units were launched in Q2
2018.
* Market rental rates for condominiums were under
downward pressure due to ample supply, whilst market
prices for condominiums declined slightly, but
remained stable in the price range.
* Selected new launches: (i) SO Kuala Lumpur (144
units), launched in May 2018 with an average price
between RM2,300 psf (US$582 psf) and RM2,500 psf
(US$633 psf) achieved 20% take-up rate; (ii) Ara tre
Residences @ Ara Damansara - Blocks A, B & C (727
units), launched in May 2018 with an average price
between RM704 psf (US$178 psf) and RM736 psf (US$186
psf) is 60% sold.
Hospitality
* In Q2 2018, the average daily room rate for hotels in
selected competitive set to Four Points by Sheraton
Sandakan (inclusive of FPSS) increased by 0.2% to
RM187 (US$47) per room per night compared to Q2 2017.
* Average occupancy rate for hotels in selected
competitive set decreased by 4.4% to 30.2% in Q2 2018
compared to the same period in 2017.
* Sabah welcomed 1.89 million International and
Malaysian tourists in the first 6 months of 2018, an
increase of 5.35% compared to the same period in
2017.
Source: Bank Negara Malaysia website, Jones Lang Wootton Q2 report, MIER, various publications
Exchange rate - 30 June 2018: US$1:RM4.0371
Vietnam Economic Update
The Vietnamese economy is currently expanding at a rapid pace, with GDP growth of 7.08% in the first half of 2018, the highest first half result since 2011. This affirmed the Vietnamese government's prompt and effective efforts in building up the confidence of both domestic and foreign investors which has helped to stabilise the nation's macroeconomy and reduce the unemployment rate. GDP growth was 6.79% in Q2 2018 on the back of vigorous manufacturing and export expansion, rising domestic consumption and strong investment, fuelled by foreign direct investment. The World Bank has revised Vietnam's GDP growth rate upward to 6.80% for the whole of 2018 from its previous forecast of 6.50%. In addition, Fitch Ratings raised Vietnam's long-term-foreign-currency issuer rating to "BB" from "BB-", with stable outlook in May 2018. This reflects the country's improving policy-making aimed at strengthening macroeconomic performance. However, Vietnam's economy is still facing numerous challenges which include the need for state enterprise reform, negative debt and an increase in global protectionism. Trade war between Vietnam's two largest trading partners, the US and China, could lead to negative spill-over effects on the country's economic growth.
Meanwhile, Vietnam's average Consumer Price Index ("CPI") for the first six months of 2018 rose 3.29% year-on-year. In June alone, the index increased 0.61% against May and was up 4.67% as compared to June 2017. The increase was due to a surge in global fuel prices, adjustments to medical services prices and school fees, as well as increase in construction material prices due to higher demand and growths in cement and steel prices. In a bid to keep the nation's inflation in check, the Vietnamese government has implemented a new policy since July 2018, whereby citizens of the country will now enjoy lower prices for certain health services and the government has also assured that there will not be further increases in electricity tariffs for the rest of the year. According to the National Assembly of Vietnam, inflation is forecast not exceed 4.0% in 2018.
The recent anti-China protest in June 2018, sparked by the designation of special economic zones with long leases, has created renewed uncertainties among Chinese investors looking to invest in Vietnam. This unrest may spill-over to harm ethnic ties, diplomatic relations and foreign investment. Nevertheless, on the back of strong growth momentum, Vietnam's FDI in the first half of the year reached US$20.33 billion, an uplift of 5.7% compared to the same period in 2017. Vietnam has long attracted large FDI inflows especially for labour-intensive export-oriented manufacturing. Countries such as Japan, Korea and Singapore remain to be the top three investors of the country. Manufacturing-processing industry continued to attract the most FDI in Vietnam in the first six months of 2018, with US$7.91 billion, accounting for 38.9% of the total registered FDI. It was followed by real estate, with US$5.54 billion, and the wholesale and retail sector with US$1.50 billion, making up 27.3% and 7.4% percent of the total, respectively.
The country's first-half exports rose 16.0% from the same period last year to US$113.93 billion, while imports increased 10.0% to US$111.22 billion, resulting in a US$2.71 billion surplus for the period as compared to a deficit of US$3.5 billion during the same period last year. The key drivers behind export growth were mobile phones, computers and electronic equipment, which accounted for 38.4% of total export value, rose by 18% year-on-year. Meanwhile, import growth was driven by a 38.8% increase in gasoline and a 17.1% increase in textiles.
In the meantime, Vietnam recorded 7.89 million of international tourist arrivals in the first half of the year, an increase of 27.2% year-on-year. This is attributed to the Vietnamese government's continued initiatives in the tourism sector, particularly in organising tourism promotion activities for international markets. Vietnam first offered visa waivers to citizens from five European countries, namely United Kingdom, France, Germany, Spain and Italy in July 2015, a policy that has been extended for a period of three years to 30 June 2021.
Overview of Property Market in Vietnam
Offices
* No new supply of office stock in Q2 2018.
* Average rental rate for Grade A increased by 7.1%
q-o-q and 17.1% y-o-y, whilst Grade B rose 0.7% q-o-q
and 7.3% y-o-y to US$42.5 and US$22.5 psm per month
respectively, driven by limited remaining space and
higher demand.
* Vacancy rate for Grade A dropped by 1.3% q-o-q and
0.6% y-o-y, whilst Grade B increased slightly by 0.4%
q-o-q but decreased 1.2% y-o-y to 4.7% and 2.9%
respectively, amid limited office supply and rapid
absorption of the market.
Retail
* No new supply of retail stock in the review quarter.
* In Q2 2018, average rental rate for department stores
remained unchanged at US$96.7 psm per month; whilst
rate for shopping centres increased by 9.1% y-o-y to
US$141.2 psm per month and retail podium rose by 1.8%
y-o-y to US$84.6 psm per month, due to limited
available space and unchanged tenant mix.
* Overall vacancy rate was 8.8%, a slight decrease of
0.7% q-o-q but an increase of 0.8% y-o-y, due to
improvement in occupancy for retail podium and no new
retail stock.
Residential
* 18 new condominium projects from 1 Luxury Grade (40
units), 7 High-end Grade (3,300 units), 9 Mid-end
Grade (2,567 units), and 1 Affordable Grade (202
units) were launched in Q2 2018, a decrease of 36%
q-o-q and y-o-y. Asking price for each segment: -
o Grade Luxury: Between US$3,843 psm to US$5,104 psm;
o Grade High-end: Between US$1,940 psm to US$1,994 psm;
o Grade Mid-end: Between US$1,150 psm to US$1,138 psm; and
o Grade Affordable: Between US$720 psm to US$780 psm.
* Condominium transaction volume was registered at
6,977 units in Q2 2018, a decrease of 25% q-o-q and
29% y-o-y.
Hospitality
* Overall, the hotel stock was slightly down by 2%
y-o-y to 16,250 rooms due to the closure of four
3-star projects.
* Average occupancy rate was at 67%, the highest in the
last 5 years during low season. Average room rate was
stable q-o-q and increased by 7% y-o-y at US$ per
room per night due to significant growth of
international arrivals.
* One new Grade A serviced apartment project (243
units) was launched in Q2 2018. Average rental rate
of Grade A serviced apartment decreased 4.5% q-o-q,
whilst Grade B was stable, but up 4.0% and 6.8% y-o-y
respectively, to US$37.57 psm per month for Grade A
and US$32.34 psm per month for Grade B. Occupancy
rate for Grade A serviced apartment decreased 7.9%
q-o-q and 7.7% y-o-y to 87.4%, whilst Grade B
remained unchanged at 92.2%.
Source: General Statistics Office of Vietnam, Savills, CBRE, various publications
Exchange rate - 30 June 2018: US$1:VND22,955
LAI VOON HON
President
Ireka Development Management Sdn. Bhd.
Development Manager
31 August 2018
PROPERTY PORTFOLIO AS AT 30 JUNE 2018
Project Type Effective Approximate
Ownership Gross
Floor Approximate
Area Land Area Scheduled
(sq m) (sq m) completion
-------------------------- --------------------- ----------- ------------ ------------ --------------------------
Completed projects
----------------------------------------------------------------------------------------------------------------------
Phase 1: Completed
in April 2011
SENI Mont' Kiara Phase 2: Completed
Kuala Lumpur, Malaysia Luxury condominiums 100.0% 225,000 36,000 in October 2011
-------------------------- --------------------- ----------- ------------ ------------ --------------------------
Retail lots: Completed
in 2009
Sandakan Harbour Retail mall: Completed
Square Retail lots, in March 2012
Sandakan, Sabah, hotel and retail Hotel: Completed in
Malaysia mall 100.0% 126,000 48,000 May 2012
-------------------------- --------------------- ----------- ------------ ------------ --------------------------
Phase 1: City
International
Hospital, International
Healthcare Park,
Ho Chi Minh City, Private general Completed in March
Vietnam hospital 72.4%* 48,000 25,000 2013
-------------------------- --------------------- ----------- ------------ ------------ --------------------------
Project under development
----------------------------------------------------------------------------------------------------------------------
The RuMa Hotel and Luxury residential
Residences tower and bespoke
Kuala Lumpur, Malaysia hotel 70.0% 40,000 4,000 Third quarter of 2018
-------------------------- --------------------- ----------- ------------ ------------ --------------------------
Undeveloped projects
----------------------------------------------------------------------------------------------------------------------
Other developments
in International
Healthcare Park, Commercial
Ho Chi Minh City, and residential
Vietnam (formerly development
International Hi-Tech with healthcare
Healthcare Park) theme 72.4%* 972,000 351,000 n/a
-------------------------- --------------------- ----------- ------------ ------------ --------------------------
Kota Kinabalu Seafront (i) Boutique 100.0% n/a 327,000 n/a
resort & residences resort hotel
Kota Kinabalu, Sabah, and resort 80.0%
Malaysia villas
(ii) Resort
homes
-------------------------- --------------------- ----------- ------------ ------------ --------------------------
Divested projects
----------------------------------------------------------------------------------------------------------------------
Tiffani by i-ZEN Completed in August
Kuala Lumpur, Malaysia Luxury condominiums 100.0% 81,000 15,000 2009
-------------------------- --------------------- ----------- ------------ ------------ --------------------------
Office suites,
1 Mont' Kiara by office tower
i-ZEN and retail Completed in November
Kuala Lumpur, Malaysia mall 100.0% 96,000 14,000 2010
-------------------------- --------------------- ----------- ------------ ------------ --------------------------
Waterside Estates
Ho Chi Minh City, Villa and high-rise
Vietnam apartments 55.0% 94,000 57,000 n/a
-------------------------- --------------------- ----------- ------------ ------------ --------------------------
Kuala Lumpur Sentral Office towers: Completed
Office Towers & Office towers in December 2012
Hotel Kuala Lumpur, and a business Hotel: Completed in
Malaysia hotel 40.0% 107,000 8,000 January 2013
-------------------------- --------------------- ----------- ------------ ------------ --------------------------
Business-class
Aloft Kuala Lumpur hotel
Sentral Hotel Kuala (a Starwood Completed in January
Lumpur, Malaysia Hotel) 100.0% 28,000 5,000 2013
-------------------------- --------------------- ----------- ------------ ------------ --------------------------
Listed equity investment Listed equity 6.9% n/a n/a Effective ownership
in Nam Long Investment investment as at FY2015 before
Corporation, an full disposal in November
established developer 2016
in
Ho Chi Minh City,
Vietnam
-------------------------- --------------------- ----------- ------------ ------------ --------------------------
*Shareholding as at 30 June 2018
n/a: Not available / not applicable
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
SIX MONTHSED 30 JUNE 2018
Unaudited Unaudited Audited
Six months Six months Year
Notes ended ended ended
30 June 30 June 31 December
2018 2017 2017
Continuing activities US$'000 US$'000 US$'000
Restated* Restated*
------------------------------------- ------ ---------------------- ----------------- -------------------
Revenue 3 15,879 17,068 38,017
Cost of sales 5 (13,476) (11,409) (26,385)
------------------------------------- ------ ---------------------- ----------------- -------------------
Gross profit 2,403 5,659 11,632
Other income 8,299 6,202 14,176
Administrative expenses (479) (537) (927)
Foreign exchange gain 6 104 1,233 3,419
Management fees (1,036) (1,534) (3,128)
Marketing expenses (373) (170) (496)
Other operating expenses (10,607) (8,288) (18,417)
------------------------------------- ------ ---------------------- ----------------- -------------------
Operating (loss)/profit (1,689) 2,565 6,259
---------------------- ----------------- -------------------
Finance income 362 52 392
Finance costs (2,776) (2,377) (5,744)
---------------------- ----------------- -------------------
Net finance costs (2,414) (2,325) (5,352)
Net (loss)/profit before taxation (4,103) 240 907
Taxation 7 (518) (954) (1,945)
------------------------------------- ------ ---------------------- ----------------- -------------------
Loss for the period/year (4,621) (714) (1,038)
------------------------------------- ------ ---------------------- ----------------- -------------------
Other comprehensive (loss)/ income, net of tax
Items that are or may be reclassified subsequently to profit or loss
Foreign currency translation differences
for foreign operations (135) 4,983 10,079
Fair value adjustment in relation
to available-for-sale investments - - -
------------------------------------- ------ ---------------------- ----------------- -------------------
Total other comprehensive
(loss)/income for the period/year (135) 4,983 10,079
Total comprehensive (loss)/income
for the period/year (4,756) 4,269 9,041
------------------------------------- ------------------------------ ----------------- -------------------
Loss attributable to:
Equity holders of the parent (3,327) 570 (791)
Non-controlling interests (1,294) (1,284) (247)
------------------------------------- ------------------------------ ----------------- -------------------
Total (4,621) (714) (1,038)
------------------------------------- ------------------------------ ----------------- -------------------
Total comprehensive (loss)/income
attributable to:
Equity holders of the parent (3,373) 5,159 8,911
Non-controlling interests (1,383) (890) 130
------------------------------------- ------ ---------------------- ----------------- -------------------
Total (4,756) 4,269 9,041
------------------------------------- ------ ---------------------- ----------------- -------------------
(Loss)/Earnings per share
Basic and diluted (US cents) 8 (1.67) 0.29 (0.40)
------------------------------------- ------ ---------------------- ----------------- -------------------
* See Note 13
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2018
Unaudited Unaudited Audited
------------------------------- ------
As at As at As at
30 June 30 June 31 December
-------------------------------
2018 2017 2017
US$'000 US$'000 US$'000
Notes Restated* Restated*
------------------------------- ------ ---------- ------------ -------------
Non-current assets
Property, plant and equipment 615 701 663
Intangible assets 4,159 5,602 4,201
Deferred tax assets 5,356 2,059 4,268
------------------------------- ------ ---------- ------------ -------------
Total non-current assets 10,130 8,362 9,132
------------------------------- ------ ---------- ------------ -------------
Current assets
Inventories 259,910 239,661 252,549
Trade and other receivables 12,002 11,429 11,012
Prepayments 487 381 293
Current tax assets 487 814 372
Cash and cash equivalents 9,173 18,006 25,984
------------------------------- ------ ---------- ------------ -------------
Total current assets 282,059 270,291 290,210
------------------------------- ------ ---------- ------------ -------------
TOTAL ASSETS 292,189 278,653 299,342
------------------------------- ------ ---------- ------------ -------------
Equity
Share capital 10,601 10,601 10,601
Share premium 208,925 208,925 208,925
Capital redemption reserve 1,899 1,899 1,899
Translation reserve (20,920) (25,987) (20,874)
Accumulated losses (61,624) (57,427) (58,294)
------------------------------- ------ ---------- ------------ -------------
Shareholders' equity 138,881 138,011 142,257
Non-controlling interests (2,567) (1,870) (1,250)
------------------------------- ------ ---------- ------------ -------------
Total equity 136,314 136,141 141,007
------------------------------- ------ ---------- ------------ -------------
Non-current liabilities
Loans and borrowings 9 40,618 44,245 54,572
Total non-current liabilities 40,618 44,245 54,572
------------------------------- ------ ---------- ------------ -------------
Current liabilities
Trade and other payables 59,578 43,548 48,993
Amount due to non-controlling
interests 13,400 12,984 13,400
Loans and borrowings 9 12,982 10,814 12,882
Medium term notes 10 24,562 27,720 24,324
Current tax liabilities 4,735 3,201 4,164
------------------------------- ------ ---------- ------------ -------------
Total current liabilities 115,257 98,267 103,763
------------------------------- ------ ---------- ------------ -------------
Total liabilities 155,875 142,512 158,335
------------------------------- ------ ---------- ------------ -------------
TOTAL EQUITY AND LIABILITIES 292,189 278,653 299,342
------------------------------- ------ ---------- ------------ -------------
* See Note 13.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the PERIOD ended 30 JuNE 2018 - Unaudited
Total Equity
Attributable
to Equity
Redeemable Capital Fair Holders Non-
Ordinary Management Share Redemption Translation Value Accumulated of the Controlling
Shares Shares Premium Reserve Reserve Reserve Losses Parent Interests Total Equity
US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
----------------- ------------ ------------------- --------- ------------ ------------- --------- ------------- ------------- ------------- ----------------
1 January 2018 10,601 - 208,925 1,899 (20,874) - (58,294) 142,257 (1,250) 141,007
Purchase of own
shares - - - - - - - - - -
Changes in
ownership
interests in
subsidiaries - - - - - - (3) (3) 3 -
Non-controlling
interests
contribution - - - - - - - - 63 63
------------ ------------------- --------- ------------ ------------- --------- ------------- ------------- ------------- ----------------
Loss for the
period - - - - - - (3,327) (3,327) (1,294) (4,621)
Total other
comprehensive
loss - - - - (46) - - (46) (89) (135)
------------ ------------------- --------- ------------ ------------- --------- ------------- ------------- ------------- ----------------
Total
comprehensive
loss - - - - (46) - (3,327) (3,373) (1,383) (4,756)
Shareholders'
equity
at 30 June 2018 10,601 - 208,925 1,899 (20,920) - (61,624) 138,881 (2,567) 136,314
================= ============ =================== ========= ============ ============= ========= ============= ============= ============= ================
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the PERIOD ended 30 JuNE 2017 - Unaudited
Total Equity
Attributable
to Equity
Redeemable Capital Fair Holders Non-
Ordinary Management Share Redemption Translation Value Accumulated of the Controlling
Shares Shares Premium Reserve Reserve Reserve Losses Parent Interests Total Equity
US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
----------------- ------------ ----------- --------- ------------ ------------- --------- ------------- ------------- ------------- --------------------
1 January 2017 10,601 - 218,926 1,899 (29,142) - (58,922) 143,362 (1,148) 142,214
Impact of change
in
accounting
policy* - - - - (1,434) - 935 (499) - (499)
----------------- ------------ ----------- --------- ------------ ------------- --------- ------------- ------------- ------------- --------------------
Adjusted balance
at
1 January 2017 10,601 - 218,926 1,899 (30,576) - (57,987) 142,863 (1,148) 141,715
Purchase of own
shares - - (10,001) - - - - (10,001) - (10,001)
Changes in
ownership
interests in
subsidiaries - - - - - - (10) (10) 10 -
Non-controlling
interests
contribution - - - - - - - - 158 158
------------ ----------- --------- ------------ ------------- --------- ------------- ------------- ------------- --------------------
Loss for the
period - - - - - - 570 570 (1,284) (714)
Total other
comprehensive
income - - - - 4,589 - - 4,589 394 4,983
------------ ----------- --------- ------------ ------------- --------- ------------- ------------- ------------- --------------------
Total
comprehensive
income - - - - 4,589 - 570 5,159 (890) 4,269
Shareholders'
equity
at 30 June 2017 10,601 - 208,925 1,899 (25,987) - (57,427) 138,011 (1,870) 136,141
================= ============ =========== ========= ============ ============= ========= ============= ============= ============= ====================
* The Group has applied IFRS 15 using the cumulative effect method as an adjustment to the opening balance of equity at 1 January 2017.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 31 DECEMBER 2017 - audited
Total Equity
Attributable
to Equity
Redeemable Capital Fair Holders Non-
Ordinary Management Share Redemption Translation Value Accumulated of the Controlling
Shares Shares Premium Reserve Reserve Reserve Losses Parent Interests Total Equity
US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
----------------- ------------ ----------- --------- ------------ ------------- --------- ------------- ------------- ------------- --------------------
1 January 2017 10,601 - 218,926 1,899 (29,142) - (58,922) 143,362 (1,148) 142,214
Impact of change
in
accounting
policy* - - - - (1,434) - 935 (499) - (499)
Adjusted balance
at
1 January 2017 10,601 - 218,926 1,899 (30,576) - (57,987) 142,863 (1,148) 141,715
Purchase of own
shares - - (10,001) - - - - (10,001) - (10,001)
Changes in
ownership
interests in
subsidiaries - - - - - - 484 484 (484) -
Non-controlling
interests
contribution - - - - - - - - 252 252
------------ ----------- --------- ------------ ------------- --------- ------------- ------------- ------------- --------------------
Loss for the
year - - - - - - (791) (791) (247) (1,038)
Total other
comprehensive
income - - - - 9,702 - - 9,702 377 10,079
------------ ----------- --------- ------------ ------------- --------- ------------- ------------- ------------- --------------------
Total
comprehensive
income - - - - 9,702 - (791) 8,911 130 9,041
Shareholders'
equity
at 31 December
2017 10,601 - 208,925 1,899 (20,874) - (58,294) 142,257 (1,250) 141,007
================= ============ =========== ========= ============ ============= ========= ============= ============= ============= ====================
*The Group has applied IFRS 15 using the cumulative effect method as an adjustment to the opening balance of equity at 1 January 2017.
CONSOLIDATED STATEMENT OF CASH FLOWS
SIX MONTHSED 30 JUNE 2018
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2018 2017 2017
US$'000 US$'000 US$'000
Restated* Restated*
-------------------------------------------------------- -------------- ----------- -------------------------
Cash Flows from Operating Activities
Net (loss)/profit before taxation (4,103) 240 907
Finance income (362) (52) (392)
Finance costs 2,776 2,377 5,744
Unrealised foreign exchange gain (84) (1,261) (2,973)
Write down/Impairment of goodwill 42 1,479 2,880
Depreciation of property, plant
and equipment 41 43 84
Operating (loss)/profit before changes
in working capital (1,690) 2,826 6,250
Changes in working capital:
(Increase)/Decrease in inventories (7,803) 8,224 5,871
(Increase)/Decrease in trade and
other receivables and prepayments (1,170) 383 1,499
Increase/(Decrease) in trade and
other payables 10,488 (9,318) (4,664)
-------------------------------------------------------- -------------- ----------- -----------------------
Cash (used in)/from operations (175) 2,115 8,956
Interest paid (2,776) (2,377) (5,744)
Tax paid (1,107) (455) (2,606)
-------------------------------------------------------- -------------- ----------- -----------------------
Net cash (used in) /from operating
activities (4,058) (717) 606
-------------------------------------------------------- -------------- ----------- -----------------------
Cash Flows From Investing Activities
Proceeds from disposal of available-for-sale
Investments (iii) - 893 893
Proceeds from disposal of property,
plant and
equipment - - (5)
Proceeds from disposal of an indirectly
held
subsidiary - - 800
Finance income received 362 52 392
-------------------------------------------------------- -------------- ----------- -----------------------
Net cash from investing activities 362 945 2,080
-------------------------------------------------------- -------------- ----------- -----------------------
*See Note 13
CONSOLIDATED STATEMENT OF CASH FLOWS (CONT'D)
SIX MONTHSED 30 JUNE 2018
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
June 30 June 31 December
2018 2017 2017
US$'000 US$'000 US$'000
-------------------------------------------------------- -------------- ----------- -------------------------
Cash Flows From Financing Activities
Advances from non-controlling interests 19 205 327
Issuance of ordinary shares of subsidiaries
to non-controlling interests (ii) 63 158 252
Purchase of own shares - (10,001) (10,001)
Repayment of loans and borrowings (15,798) (2,345) (14,773)
Repayment of medium term notes - - (4,615)
Drawdown of loans and borrowings 2,598 176 25,038
Net decrease in pledged deposits
for loans and borrowings and Medium
Term Notes 13,700 2,129 7,923
Deposits subject to restriction
in use (iv) - (186) (13,867)
-------------------------------------------------------- -------------- ----------- -------------------------
Net cash from/(used in) financing
activities 582 (9,864) (9,716)
-------------------------------------------------------- -------------- ----------- -------------------------
Net changes in cash and cash equivalents
during the period/year (3,114) (9,636) (7,030)
Effect of changes in exchange rates 154 506 (315)
Cash and cash equivalents at the
beginning of the period/year (i) 9,294 16,639 16,639
-------------------------------------------------------- -------------- ----------- -------------------------
Cash and cash equivalents at the
end of the period/year (i) 6,334 7,509 9,294
-------------------------------------------------------- -------------- ----------- -------------------------
(i) Cash and Cash Equivalents
Cash and cash equivalents included in the consolidated statement
of cash flows comprise the following consolidated statement of financial
position amounts:
Cash and bank balances 2,973 5,940 10,343
Short term bank deposits 6,200 12,066 15,641
-------------------------------------------------------- -------------- ----------- -------------------------
9,173 18,006 25,984
Less: Deposits subject to restriction
in use (iv) - - (13,867)
Less: Deposits pledged (v) (2,839) (10,497) (2,823)
-------------------------------------------------------- -------------- ----------- -------------------------
Cash and cash equivalents 6,334 7,509 9,294
-------------------------------------------------------- -------------- ----------- -------------------------
(ii) During the financial period/year, US$63,000 (30 June 2017: US$158,000; 31 December 2017: US$252,000) of ordinary shares of subsidiaries were issued to non-controlling shareholders, of which was satisfied via cash consideration.
(iii) In 2016, the Group disposed the entire balance representing 9,784,653 shares in Nam Long for a consideration of US$9,848,000 of which US$8,955,000 was received in 2016. The balance consideration of US$893,000 was received during the financial year 2017.
(iv) Included in short term bank deposits on 30 June 2018 is nil balance (31 December 2017: US$13,867,000), a term loan granted to City International Hospital Company Ltd ("CIH") by Vietbank where utilisation is restricted solely for the purpose of refinancing the existing syndicated term loan under CIH.
(v) Included in short term bank deposits, cash and bank balance is US$2,839,000 (31 December 2017: US$2,823,000) pledged for loans and borrowings and Medium Term Notes of the Group.
The notes to the financial statements form an integral part of the financial statements.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHSED 30 JUNE 2018
1 General Information
The principal activities of the Group are development of upscale residential and hospitality projects, sale of development land and operation and sale of hotel, mall and hospital in Malaysia and Vietnam.
2 Summary of Significant Accounting Policies
2.1 Basis of Preparation
The interim condensed consolidated financial statements for the six months ended 30 June 2018 has been prepared in accordance with IAS 34, Interim Financial Reporting.
The interim condensed consolidated financial statements should be read in conjunction with the annual financial statements for the year ended 31 December 2017 which has been prepared in accordance with IFRS.
Taxes on income in the interim period are accrued using the tax rate that would be applicable to expected total annual earnings.
The interim results have not been audited nor reviewed and do not constitute statutory financial statements.
The preparation of financial statements in conformity with IFRS requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Although these estimates are based on management's best knowledge of the amount, event or actions, actual results ultimately may differ from those estimates.
Except for the changes below, the accounting policies applied are consistent with those of the annual financial statements for the year ended 31 December 2017 as described in those annual financial statements.
The Group adopted International Accounting Standard IFRS 15 Revenue from Contracts with Customers with a date of initial application of 1 Jan 2018. As a result, the Group changed its accounting policy for revenue recognition. The Group applied IFRS 15 by recognising the cumulative effect of initially applying IFRS 15 as an adjustment to the opening balance of equity as at 1 January 2017. Adjustments to revenue are made for property development activities of serviced residences for The RuMa, where no revenue was previously recognised under IFRIC 15 - Agreements for Construction of Real Estate, which prescribes that revenue be recognised only when the properties are completed and occupancy permits are issued.
The interim report and financial statements were approved by the Board of Directors on 30 August 2018.
3 SegmentAL Information
The Group's assets and business activities are managed by Ireka Development Management Sdn. Bhd. ("IDM") as the Development Manager under a management agreement dated 27 March 2007.
Segmental information represents the level at which financial information is reported to the Executive Management of IDM, being the chief operating decision maker as defined in IFRS 8. The Executive Management consists of the Chief Executive Officer, the Chief Financial Officer, Chief Operating Officer and Chief Investment Officer of IDM. The management determines the operating segments based on reports reviewed and used by the Executive Management for strategic decision making and resource allocation. For management purposes, the Group is organised into project units.
The Group's reportable operating segments are as follows:
(i) Investment Holding Companies - investing activities;
(ii) Ireka Land Sdn. Bhd. - develops Tiffani ("Tiffani") by i-ZEN;
(iii) ICSD Ventures Sdn. Bhd. - owns and operates Harbour Mall Sandakan ("HMS") and Four Points by Sheraton Sandakan Hotel ("FPSS");
(iv) Amatir Resources Sdn. Bhd. - develops SENI Mont' Kiara ("SENI");
(v) Urban DNA Sdn. Bhd.- develops The RuMa Hotel and Residences ("The Ruma"); and
(vi) Hoa Lam-Shangri-La Healthcare Group - master developer of International Healthcare Park ("IHP"); owns and operates the City International Hospital ("CIH").
Other non-reportable segments comprise the Group's other development projects. None of these segments meets any of the quantitative thresholds for determining reportable segments in 2018 and 2017.
Information regarding the operations of each reportable segment is included below. The Executive Management monitors the operating results of each segment for the purpose of performance assessments and making decisions on resource allocation. Performance is based on segment gross profit/(loss) and profit/(loss) before taxation, which the Executive Management believes are the most relevant in evaluating the results relative to other entities in the industry. Segment assets presented inclusive of inter-segment balances and inter-segment pricing is determined on an arm's length basis.
The Group's revenue generating development projects are in Malaysia and Vietnam.
Operating Segments - ended 30 June 2018- Unaudited
Hoa
Investment Ireka Land ICSD Amatir Urban Lam-Shangri-La
Holding Sdn. Bhd. Ventures Resources DNA Healthcare
Companies Sdn. Bhd. Sdn. Bhd. Sdn. Bhd. Group Total
US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
--------------- ------------- ------------- -------------- -------------- ------------ --------------- --------
Segment
(loss)/profit
before
taxation (896) (34) (753) 777 569 (810) (1,147)
=============== ============= ============= ============== ============== ============ =============== ========
Included in
the measure of
segment
profit/(loss)
are:
Revenue - - - 4,322 11,557 - 15,879
Revenue from
hotel
operations - - 1,859 - - - 1,859
Revenue from
mall
operations - - 865 - - - 865
Revenue from
hospital
operations - - - - - 5,192 5,192
Cost of
acquisition
written
down # - - - (775) - - (775)
Impairment of
goodwill - - - (42) - - (42)
Marketing
expenses - - - - (373) - (373)
Expenses from
hotel
operations - - (2,189) - - - (2,189)
Expenses from
mall
operations - - (711) - - - (711)
Expenses from
hospital
operations - - - - - 5,615 5,615
Depreciation
of property,
plant and
equipment - - - - - (40) (40)
Finance costs - - (782) - - (1,971) (2,753)
Finance income 1 51 5 9 296 362
=============== ============= ============= ============== ============== ============ =============== ========
Segment assets 461 803 83,775 9,747 93,006 90,163 277,955
Included in the measure
of segment assets are:
Addition to non-current
assets other than financial
instruments and deferred
tax assets - - - - - - -
============================== ==== ==== ======= ====== ======= ======= ========
# Cost of acquisition relates to the fair value adjustment
in relation to the inventories upon the acquisition
of certain subsidiaries of the Group. The cost of
acquisition written down is charged to profit or loss
as part of cost of sales upon the sales of these inventories.
Reconciliation of reportable segment revenues, profit or loss, assets and liabilities and other material items
Profit or loss US$'000 ------------------------------------ -------- Total loss for reportable segments (1,147) Other non-reportable segments (2,933) Depreciation - Finance costs (23) Finance income - Consolidated loss before taxation (4,103) ==================================== ========
Operating Segments - ended 30 June 2017 - Unaudited
Hoa
Investment Ireka Land ICSD Amatir Urban Lam-Shangri-La
Holding Sdn. Bhd. Ventures Resources DNA Healthcare
Companies Sdn. Bhd. Sdn. Bhd. Sdn. Bhd. Group Total
US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
Restated Restated
--------------- ------------- ------------- ------------- ------------- ------------ --------------- ----------
Segment
(loss)/profit
before
taxation 226 (141) (961) 273 2,846 (1,947) 296
=============== ============= ============= ============= ============= ============ =============== ==========
Included in
the measure of
segment
profit/(loss)
are:
Revenue - - - 4,002 7,689 5,377 17,068
Revenue from
hotel
operations - - 1,777 - - - 1,777
Revenue from
mall
operations - - 667 - - - 667
Revenue from
hospital
operations - - - - - 3,503 3,503
Cost of
acquisition
written
down # - - - (807) - - (807)
Impairment of
goodwill - - - (44) - (1,435) (1,479)
Marketing
expenses - - - (6) (164) - (170)
Expenses from
hotel
operations - - (1,917) - - - (1,917)
Expenses from
mall
operations - - (782) - - - (782)
Expenses from
hospital
operations - - - - - 4,869 4,869
Depreciation
of property,
plant and
equipment - - - - - (43) (43)
Finance costs - - (729) - - (1,648) (2,377)
Finance income 8 1 2 8 13 20 52
=============== ============= ============= ============= ============= ============ =============== ==========
Segment assets 1,202 1,910 79,310 16,393 65,918 94,988 259,721
Included in the measure
of segment assets are:
Addition to non-current
assets other than
financial
instruments and deferred
tax assets - - - - - - -
========================== ====== ====== ======= ======= ======= ======= ========
Reconciliation of reportable segment revenues, profit or loss, assets and liabilities and other material items
Profit or loss US$'000
Restated
-------------------------------------- ----------
Total profit for reportable segments 296
Other non-reportable segments (56)
Depreciation -
Finance costs -
Finance income -
Consolidated profit before taxation 240
====================================== ==========
Operating Segments - ended 31 December 2017 - Audited
Hoa Lam
Investment Ireka Land ICSD Ventures Amatir Urban Shangri-La
Holding Sdn. Bhd. Sdn. Bhd. Resources DNA Healthcare
Companies Sdn. Bhd. Sdn. Bhd. Group Total
US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
Restated Restated
---------------- ------------- ------------- ---------------- ------------ ------------ ------------ ----------
Segment profit/
(loss) before
taxation 1,077 (432) (1,554) 193 4,505 (2,852) 937
================ ============= ============= ================ ============ ============ ============ ==========
Included in the
measure
of segment
profit/ (loss)
are:
Revenue - 935 - 5,031 18,919 13,132 38,017
Other income
from hotel
operations - - 3,842 - - - 3,842
Other income
from mall
operations - - 1,440 - - - 1,440
Other income
from hospital
operations - - - - - 8,234 8,234
Disposal of
intangible
assets - - - (53) - (2,827) (2,880)
Marketing
expenses - - - (8) (488) - (496)
Expenses from
hotel
operations - - (3,939) - - - (3,939)
Expenses from
mall
operations - - (1,488) - - - (1,488)
Expenses from
hospital
operations - - - - - (10,491) (10,491)
Depreciation of
property,
plant and
equipment - - - - - (84) (84)
Finance costs - - (1,713) - - (4,031) (5,744)
Finance income 6 2 236 12 23 113 392
Segment assets 735 523 83,525 15,438 80,023 104,829 285,073
================ ============= ============= ================ ============ ============ ============ ==========
Reconciliation of reportable segment revenues, profit or loss, assets and liabilities and other material items
Profit or loss US$'000
Restated
-------------------------------------- ---------------------
Total profit for reportable segments 937
Other non-reportable segments (30)
Consolidated profit before taxation 907
====================================== =====================
30 June 2018 - Unaudited Addition to
non-current
US$'000 Revenue Depreciation Finance costs Finance income Segment assets assets
------------------------- -------- ------------- -------------- --------------- ------------------ -------------
Total reportable segment 15,879 (40) (2,753) 362 277,955 -
Other non-reportable
segments - (1) (23) - 14,234 -
------------------------- -------- ------------- -------------- --------------- ------------------ -------------
Consolidated total 15,879 (41) (2,776) 362 292,189 -
========================= ======== ============= ============== =============== ================== =============
30 June 2017 -
Unaudited Addition to
non-current
US$'000 Revenue Depreciation Finance costs Finance income Segment assets assets
Restated Restated
----------------------- --------- ------------- -------------- --------------- ------------------- -------------
Total reportable
segment 17,068 (43) (2,377) 52 259,721 -
Other non-reportable
segments - - - - 18,932 -
----------------------- --------- ------------- -------------- --------------- ------------------- -------------
Consolidated total 17,068 (43) (2,377) 52 278,653 -
======================= ========= ============= ============== =============== =================== =============
31 December 2017- Audited Addition to
non-current
US$'000 Revenue Depreciation Finance costs Finance income Segment assets assets
Restated Restated
--------------------------- --------- ------------- -------------- --------------- --------------- -------------
Total reportable segment 38,017 (84) (5,744) 392 285,073 -
Other non-reportable
segments - - - - 14,269 5
--------------------------- --------- ------------- -------------- --------------- --------------- -------------
Consolidated total 38,017 (84) (5,744) 392 299,342 5
=========================== ========= ============= ============== =============== =============== =============
Geographical Information - ended 30 June 2018 - Unaudited
Malaysia Vietnam Consolidated
US$'000 US$'000 US$'000
-------------------- --------- -------- -------------
Revenue 15,879 - 15,879
Non-current assets 6,000 4,130 10,130
==================== ========= ======== =============
Geographical Information - ended 30 June 2017 - Unaudited
Malaysia Vietnam Consolidated
US$'000 US$'000 US$'000
-------------------- --------- -------- -------------
Revenue (Restated) 11,691 5,377 17,068
Non-current assets 2,751 5,611 8,362
==================== ========= ======== =============
Included in the revenue of the Group for financial period ended 30 June 2017 is proceeds for the sale of a plot of land (D2) at International Healthcare Park.
For the financial period ended 30 June 2017, one customer exceeded 10% of the Group's total revenue as follows:
US$'000 Segments
---------------------------- -------------- -------------------
Tien Phat Consultancy Ho Lam Shangri-La
Investment Company Limited 5,377 Healthcare Group
============================ ============== ===================
Geographical Information - ended 31 December 2017 - Unaudited
Malaysia Vietnam Consolidated
US$'000 US$'000 US$'000
-------------------- --------- -------- -------------
Revenue (Restated) 24,885 13,132 38,017
Non-current assets 4,954 4,178 9,132
==================== ========= ======== =============
Included in the revenue of the Group for the financial year ended 31 December 2017 is revenue from the sale of two plots of land (Lots D2 and D3) at the International Healthcare Park ("IHP").
For the year ended 31 December 2017, two customers exceeded 10% of the Group's total revenue as follows:
US$'000 Segments
---------------------------- -------------- -------------------
Tien Phat Consultancy Ho Lam Shangri-La
Investment Company Limited 5,399 Healthcare Group
Tri Hanh Consultancy Ho Lam Shangri-La
Co, Ltd 7,733 Healthcare Group
============================ ============== ===================
4 Seasonality
The Group's business operations are not materially affected by seasonal factors for the period
under review.
5 Cost of Sales
Unaudited Unaudited Unaudited
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2018 2017 2017
US$'000 US$'000 US$'000
Restated Restated
Direct costs attributable to:
Completed units 12,659 7,419 18,214
Sales of land held for property
development - 2,511 5,291
Impairment of inventory 42 - -
Impairment of intangible assets 775 1,479 2,880
--------------------------------- ----------- ----------- --------------------
13,476 11,409 26,385
--------------------------------- ----------- ----------- --------------------
Included in the cost of sales of the Group for the financial period ended 30 June 2017 and financial year ended 31 December 2017 is cost of sales related to sale of two plot of lands (Lots D2 and D3) at the International Healthcare Park.
6 Foreign exchange GAIN
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2018 2017 2017
US$'000 US$'000 US$'000
--------------------------------------- ----------- ----------- -------------
Foreign exchange gain comprises:
Realised foreign exchange gain/(loss) 22 (28) 446
Unrealised foreign exchange gain 82 1,261 2,973
104 1,233 3,419
--------------------------------------- ----------- ----------- -------------
7 Taxation
Unaudited Unaudited Unaudited
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2018 2017 2017
US$'000 US$'000 US$'000
Restated Restated
--------------------------------------- ----------- ----------- --------------
Current tax expense 1,624 1,311 4,590
Deferred tax credit (1,106) (357) (2,645)
--------------------------------------- ----------- ----------- --------------
Total tax expense for the period/year 518 954 1,945
--------------------------------------- ----------- ----------- --------------
The numerical reconciliation between the income tax expense and the product of accounting results multiplied by the applicable tax rate is computed as follows:
Unaudited Unaudited Unaudited
Six months Six months Year
ended ended Ended
30 June 30 June 31 December
2018 2017 2017
US$'000 US$'000 US$'000
Restated Restated
--------------------------------------- ----------- ----------- -------------
Net (loss)/profit before taxation (4,103) 240 907
--------------------------------------- ----------- ----------- -------------
Income tax at a rate of 24% (30
June 2017: 24%; 31 December 2017:
24%) (985) 58 218
Add :
Tax effect of expenses not deductible
in determining taxable profit 1,295 1,391 592
Current year losses and other tax
benefits for which no deferred
tax asset was recognised 2,027 1,939 1,742
Tax effect of different tax rates
in subsidiaries 221 634 590
Less :
Tax effect of income not taxable
in determining taxable profit (2,121) (3,068) (671)
(Under)/Over provision in respect
of prior period/year 81 - (526)
--------------------------------------- ----------- ----------- -------------
Total tax expense for the period/year 518 954 1,945
--------------------------------------- ----------- ----------- -------------
The applicable corporate tax rate in Malaysia is 24%.
The Company is treated as a tax resident of Jersey for the purpose of Jersey tax laws and is subject to a tax rate of 0%.
The applicable corporate tax rates in Singapore and Vietnam are 17% and 20% respectively.
A subsidiary of the Group, CIH is granted preferential corporate tax rate of 10% for the results of the hospital operations. The preferential income tax is given by the government of Vietnam due to the subsidiary's involvement in the healthcare industry.
A Goods and Services Tax was introduced in Jersey in May 2008. The Company has been registered as an International Services Entity so it does not have to charge or pay local GST. The cost for this registration is GBP200 per annum.
The Directors intend to conduct the Group's affairs such that the central management and control is not exercised in the United Kingdom and so that neither the Company nor any of its subsidiaries carries on any trade in the United Kingdom. The Company and its subsidiaries will thus not be residents in the United Kingdom for taxation purposes. On this basis, they will not be liable for United Kingdom taxation on their income and gains other than income derived from a United Kingdom source.
8 (LOSS)/EARNINGS Per Share
Basic and diluted (loss)/earnings per ordinary share
The calculation of basic and diluted (loss)/earnings per ordinary share for the period/year ended was based on the (loss)/profit attributable to equity holders of the parent and a weighted average number of ordinary shares outstanding, calculated as below:
Unaudited Unaudited Unaudited
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2018 2017 2017
Restated Restated
----------------------------------- ------------------- ----------------- -------------
(Loss)/earnings attributable
to equity holders of the parent
(US$'000) (3,327) 570 (791)
Weighted average number of shares 198,691,000 199,019,784 199,019,784
(Loss)/earnings per share
Basic and diluted (US cents) (1.67) 0.29 (0.40)
----------------------------------- ------------------- ----------------- -------------
Weighted average number of ordinary shares
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2018 2017 2017
----------------------------- ---------------------- ------------------------- --------------
Issued ordinary shares at 1
January 198,691,000 212,025,002 212,025,002
Effect of share buy back - (13,005,218) (13,005,218)
Weighted average number of
ordinary shares at 198,691,000 199,019,784 199,019,784
----------------------------- ---------------------- ------------------------- --------------
9 Loans and Borrowings
Unaudited Unaudited Audited
As at As at As at
30 June 30 June 31 December
2018 2017 2017
US$'000 US$'000 US$'000
--------------------------- ---------- ---------- -------------
Non-current
Bank loans 40,618 44,245 54,572
Finance lease liabilities - - -
--------------------------- ---------- ---------- -------------
40,618 44,245 54,572
--------------------------- ---------- ---------- -------------
Current
Bank loans 12,982 10,814 12,882
Finance lease liabilities - - -
--------------------------- ---------- ---------- -------------
12,982 10,814 12,882
--------------------------- ---------- ---------- -------------
53,600 55,059 67,454
--------------------------- ---------- ---------- -------------
The effective interest rates on the bank loans and finance lease arrangement for the period ranged from 5.25% to 12.50% (30 June 2017: 5.00% to 12.50%; 31 December 2017: 5.35% to 10.50%) per annum and 2.50% (30 June 2017: 2.50%; 31 December 2017: 2.50%) per annum respectively.
Borrowings are denominated in Malaysian Ringgit, United States Dollars and Vietnamese Dong.
Bank loans are repayable by monthly, quarterly or semi-annually instalments.
Bank loans are secured by land held for property development, work-in-progress, operating assets of the Group, pledged deposits and some by the corporate guarantee of the Company.
Reconciliation of movement of loans and borrowings to cash flows arising from financing activities:
As at Foreign
1 January Drawdown Repayment exchange As at 30
2018 of loan of loan movements June 2018
Unaudited US$'000 US$'000 US$'000 US$'000 US$'000
--------------------------- ----------- --------- ---------- ----------- -----------
Bank loans 67,454 2,598 (15,798) (654) 53,600
Finance lease liabilities - - - - -
----------- --------- ---------- ----------- -----------
Total 67,454 2,598 (15,798) (654) 53,600
=========== ========= ========== =========== ===========
As at Foreign
1 January Drawdown Repayment exchange As at 30
2017 of loan of loan movements June 2017
Unaudited US$'000 US$'000 US$'000 US$'000 US$'000
--------------------------- ----------- --------- ---------- ----------- -----------
Bank loans 57,209 176 (2,342) 16 55,059
Finance lease liabilities 3 - (3) - -
----------- --------- ---------- ----------- -----------
Total 57,212 176 (2,345) 16 55,059
=========== ========= ========== =========== ===========
As at Foreign As at 31
1 January Drawdown Repayment exchange December
2017 of loan of loan movements 2017
Audited US$'000 US$'000 US$'000 US$'000 US$'000
--------------------------- ----------- --------- ---------- ----------- ----------
Bank loans 57,209 25,038 (14,770) (23) 67,454
Finance lease liabilities 3 - (3) - -
----------- --------- ---------- ----------- ----------
Total 57,212 25,038 (14,773) (23) 67,454
=========== ========= ========== =========== ==========
10 Medium Term Notes
Unaudited Unaudited Audited
As at As at As at
30 June 30 June 31 December
2018 2017 2017
US$'000 US$'000 US$'000
----------------------------------- ---------- ---------- ------------
Outstanding medium term notes 24,770 27,948 24,710
Net transaction costs (208) (228) (386)
Less:
Repayment due within twelve
months* (24,562) (27,720) (24,324)
----------------------------------- ---------- ---------- ------------
Repayment due after twelve months - - -
----------------------------------- ---------- ---------- ------------
Reconciliation of movement of medium term notes to cash flows arising from financing activities:
As at Foreign
1 January Drawdown Repayment exchange As at 30
2018 of loan of loan movements June 2018
Unaudited US$'000 US$'000 US$'000 US$'000 US$'000
--------------------- ----------- --------- ---------- ----------- -----------
Medium Term Notes 24,324 - - 238 24,562
----------- --------- ---------- ----------- -----------
As at Foreign
1 January Drawdown Repayment exchange As at 30
2017 of loan of loan movements June 2017
Unaudited US$'000 US$'000 US$'000 US$'000 US$'000
--------------------- ----------- --------- ---------- ----------- -----------
Medium Term Notes 26,343 - - 1,377 27,720
----------- --------- ---------- ----------- -----------
As at Foreign As at 31
1 January Drawdown Repayment exchange December
2017 of loan of loan movements 2017
Audited US$'000 US$'000 US$'000 US$'000 US$'000
--------------------- ----------- --------- ---------- ----------- ----------
Medium Term Notes 26,343 - (4,615) 2,596 24,324
----------- --------- ---------- ----------- ----------
* Includes net transaction costs in relation to medium term notes due within twelve months
US$0.21 million. (30 June 2017: US$0.23million; 31 December 2017: US$0.39 million)
The medium term notes ("MTNs") were issued pursuant to a programme with a tenure of ten (10) years from the first issue date of the notes. The MTNs were issued by a subsidiary, to fund two development projects known as Sandakan Harbour Square and Aloft Kuala Lumpur Sentral ("AKLS") in Malaysia.
In 2016, the Group completed the sale of the AKLS and US$97.59 million (RM394.0 million) of MTN associated with the AKLS (Series 3) and the Four Points Sheraton Sandakan (Series 2) were repaid on 19 August 2016. The charges in relation to AKLS were also discharged following the completion of the sales.
In 2017, Silver Sparrow Berhad ("SSB") obtained consent from the lenders to utilise proceeds of US$4.95 (RM20 million) million in the Sales Proceeds Account and Debt Service Reserve Account to partially redeem the MTNs on 28 November 2017. SSB also secured a "roll-over" for the remaining MTNs of US$24.77mil (RM100million) which was due on 8 December 2017 (now extended to 10 December 2018). The MTNs are rated AAA.
No repayments were made in the current financial period.
The weighted average interest rate of the MTN was 6.00% per annum at the statement of financial position date. The effective interest rates of the MTN and their outstanding amounts are as follows:
Interest rate
Maturity Dates % per annum US$'000
---------------------- ------------------ -------------- -----------
Series 1 Tranche FGI 10 December 2018 6.00 10,651
Series 1 Tranche BG 10 December 2018 6.00 14,119
24,770
----------------------------------------- -------------- -----------
The medium term notes are secured by way of:
(i) bank guarantee from two financial institutions in respect of the BG Tranches;
(ii) financial guarantee insurance policy from Danajamin Nasional Berhad ("Danajamin") in respect to the FG Tranches;
(iii) a first fixed and floating charge over the present and future assets and properties of Silver Sparrow Berhad and ICSD Ventures Sdn. Bhd. by way of a debenture;
(iv) a third party first legal fixed charge over ICSD Ventures Sdn. Bhd.'s assets and
land;
(v) a corporate guarantee by Aseana Properties Limited;
(vi) letter of undertaking from Aseana Properties Limited to provide financial and other forms of support to ICSD Ventures Sdn. Bhd. to finance any cost overruns associated with the development of the Sandakan Harbour Square;
(vii) assignment of all its present and future rights, interest and benefits under the ICSD Ventures Sdn. Bhd.'s Put Option Agreements in favor of Danajamin, Malayan Banking Berhad and OCBC Bank (Malaysia) Berhad (collectively as "the guarantors") where once exercised, the sale and purchase of HMS and FPSS shall take place in accordance with the provision of the Put Option Agreement; and the
proceeds from HMS and FPSS will be utilised to repay the MTNs;
(viii) assignment over the disbursement account, revenue account, operating account, sale proceed account, debt service reserve account and sinking fund account of Silver Sparrow Berhad; revenue account of ICSD Venture Sdn. Bhd. and escrow account of Ireka Land Sdn. Bhd.;
(ix) assignment of all ICSD Ventures Sdn. Bhd's present and future rights, title, interest and benefits in and under the insurance policies; and
(x) a first legal charge over all the shares of Silver Sparrow Berhad, ICSD Ventures Sdn. Bhd. and any dividends, distributions and entitlements.
11 Related Party Transactions
Transactions between the Group with Ireka Corporation Berhad ("ICB") and its group of companies are classified as related party transactions based on ICB's 23.07% shareholding in the Company.
Related parties also include key management personnel defined as those persons having authority and responsibility for planning, directing and controlling the activities of the Group either directly or indirectly. The key management personnel include all the Directors of the Group, and certain members of senior management of the Group.
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2018 2017 2017
US$'000 US$'000 US$'000
------------------------------------- ----------- ----------- -------------
ICB Group of Companies
Accounting and financial reporting
services fee charged by an ICB
subsidiary 25 25 50
Advance payment (from)/to the
contractors of an ICB subsidiary (860) 943 732
Construction progress claims
charged by an ICB subsidiary 18,365 6,751 21,099
Management fees charged by an
ICB subsidiary 1,036 1,534 3,129
Marketing commission charged
by an ICB subsidiary 33 53 114
Project staff costs reimbursed
to an ICB subsidiary 155 155 311
Rental expenses charge by an
ICB subsidiary - - 4
Rental expenses paid on behalf
of ICB 389 253 516
Secretarial and administrative
services fee charged by an ICB
subsidiary 25 25 50
Key management personnel
Remuneration of key management
personnel - Directors' fees 101 135 235
Remuneration of key management
personnel - Salaries 70 70 143
------------------------------------- ----------- ----------- -------------
Transactions between the Group and other significant related parties are as follows:
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2018 2017 2017
US$'000 US$'000 US$'000
--------------------------------- ----------- ----------- -------------
Non-controlling interests
Advances - non-interest bearing 19 205 327
The above transactions have been entered into in the normal course of business and have been established under negotiated terms.
The outstanding amounts due from/ (to) ICB and its group of companies as at 30 June 2018, 30 June 2017 and 31 December 2017 are as follows:
Unaudited Unaudited Audited
As at As at As at
30 June 30 June 31 December
2018 2018 2017
Note US$'000 US$'000 US$'000
----------------------------------- -------- ---------- ---------- -------------
Amount due from an ICB subsidiary
for advance payment to its
contractors (ii) 3,164 3,993 3,993
Amount due from/(to) an ICB
subsidiary for construction
progress claims charged (i) 3,414 (20) (2,046)
Amount due from an ICB subsidiary
for acquisition of SENI Mont'
Kiara units (i) 1,957 2,012 1,952
Amount due to an ICB subsidiary
for management fees (ii) (275) - -
Amount due to an ICB subsidiary
for marketing commissions (ii) (5) (28) (15)
Amount due to ICB subsidiary
for reimbursement of project
staff costs (ii) (42) (26) (55)
Amount due to an ICB subsidiary
for rental expenses (ii) (2) - (5)
Amount due from ICB for rental
expenses paid on behalf (ii) 429 328 137
Amount due to an ICB subsidiary
for staff cost paid on behalf (ii) - - (4)
----------------------------------- -------- ---------- ---------- -------------
(i) These amounts are trade in nature and subject to normal trade terms.
(ii) These amounts are non-trade in nature and are unsecured, interest-free and repayable on demand.
The outstanding amounts due from/ (to) the other significant related parties as at 30 June 2018, 30 June 2017 and 31 December 2017 are as follows:
Unaudited Unaudited Audited
As at As at As at
30 June 30 June 31 December
2018 2017 2017
US$'000 US$'000 US$'000
--------------------------------- ---------- ---------- -------------
Non-controlling interests
Advances - non-interest bearing (13,413) (12,984) (13,400)
--------------------------------- ---------- ---------- -------------
Transactions between the parent company and its subsidiaries are eliminated in these consolidated financial statements.
12 Dividends
The Company has not paid or declared any dividends during the financial period ended 30 June 2018.
13 COMPARATIVES FIGURES
The following comparative figures of the Group have been restated arising from the adoption of International Accounting Standard IFRS 15 Revenue from Contracts with Customers released in April 2016 and effective for periods beginning on or after 1 January 2018. The Group has changed its revenue recognition accounting policy with a date of initial application of 1 January 2018.
Adjustment to revenue are made for property development activities of serviced residences under The RuMa where no revenue was recognised as per IFRIC 15 - Agreements for Construction of Real Estate, which prescribes that revenue be recognised only when the properties are completed and occupancy permits are issued.
Consolidated Statement of Comprehensive Unaudited Effect
Income for the period ended 30 Previously of adoption Unaudited
June 2017 Reported of IFRS As Restated
Amounts 15 Amounts
US$'000 US$'000 US$'000
Revenue 9,379 7,689 17,068
Cost of sales (7,242) (4,167) (11,409)
Taxation 271 (1,225) (954)
Loss for the period (3,553) 2,839 (714)
Exchange differences on translating
foreign operations 3,082 1,901 4,983
Total comprehensive income for
the period (471) 4,740 4,269
Loss for the period attributable
to the equity holders of the company (1,418) 1,988 570
Consolidated Statement of Financial Unaudited Effect
Position as at 30 June 2017 Previously of adoption Unaudited
Reported of IFRS As Restated
Amounts 15 Amounts
US$'000 US$'000 US$'000
Inventories 255,759 (16,098) 239,661
Exchange fluctuation reserve (26,036) 49 (25,987)
Accumulated losses (60,350) 2,923 (57,427)
Non-controlling interest (3,141) 1,271 (1,870)
Trade and other payables 64,604 (21,056) 43,548
Current tax liabilities 2,486 715 3,201
Shareholders' equity 135,039 2,972 138,011
Consolidated Statement of Cash Unaudited Effect
Flows Previously of adoption Unaudited
as at 30 June 2017 Reported of IFRS As Restated
Amounts 15 Amounts
US$'000 US$'000 US$'000
Operating (loss)/profit before
changes in working capital (696) 3,522 2,826
Consolidated Statement of Comprehensive Audited Effect
Income for the period ended 31 Previously of adoption Unaudited
December 2017 Reported of IFRS As Restated
Amounts 15 Amounts
US$'000 US$'000 US$'000
Revenue 19,098 18,919 38,017
Cost of sales (13,383) (13,002) (26,385)
Taxation (863) (1,082) (1,945)
Loss for the period (5,874) 4,836 (1,038)
Exchange differences on translating
foreign operations 7,863 2,216 10,079
Total comprehensive income for
the period 1,989 7,052 9,041
Loss for the period attributable
to the equity holders of the company (4,176) 3,385 (791)
Consolidated Statement of Financial Audited Effect
Position as at 31 December 2017 Previously of adoption Unaudited
Reported of IFRS As Restated
Amounts 15 Amounts
US$'000 US$'000 US$'000
Inventories 278,879 (26,330) 252,549
Exchange fluctuation reserve (21,141) 267 (20,874)
Accumulated losses (62,614) 4,320 (58,294)
Non-controlling interest (3,216) 1,966 (1,250)
Trade and other payables 83,040 (34,047) 48,993
Current tax liabilities 3,000 1,164 4,164
Shareholders' equity 137,670 4,587 142,257
Consolidated Statement of Cash Audited Effect
Flows Previously of adoption Unaudited
as at 31 December 2017 Reported of IFRS As Restated
Amounts 15 Amounts
US$'000 US$'000 US$'000
Operating profit before changes
in working capital 332 5,918 6,250
Cash generated from operations
(before interest and tax paid) 8,911 45 8,956
Net cash from operating activities 561 45 606
Effect of changes in exchange
rates (270) (45) (315)
14 EVENT AFTER THE STATEMENT OF FINANCIAL POSITION DATE
Subsequent to 30 June 2018, following the recent capital calls, Aseana increased its equity interest in Shangri-La Healthcare Investment Pte Ltd ("SHIPL") to 81.59% arising from an issue of new shares in the subsidiary for cash consideration of US$132,624. Consequently, the Company's effective equity interest in Hoa Lam - Shangri-La Healthcare Ltd Liability Co and City International Hospital Co Ltd, subsidiaries of SHIPL, increased to 72.41%.
Subsequent to 30 June 2018, Aseana disposed of a plot of land in International Healthcare Park through disposal of its entire interest in Hoa Lam Shangri-La Limited Liability Co 7 ("HLSL7"). The gross transaction value is approximately US$6,580,395 (VND150 billion). The completion of this transaction is subject to regulatory approval being obtained from local authorities.
15 Interim Statement
Copies of this interim statement are available on the Company's website www.aseanaproperties.com or from the Company's registered office at 12 Castle Street, St. Helier, Jersey, JE2 3RT, Channel Islands.
Principal Risks and Uncertainties
The Board has overall responsibility for risk management and internal control. The following have been identified previously as the areas of principal risk and uncertainty facing the Company, and they remain relevant in the second half of the year.
-- Economic -- Strategic -- Regulatory -- Law and regulations -- Tax regimes -- Management and control -- Operational -- Financial -- Going concern
For greater detail, please refer to page 16 of the Company's Annual Report for 2017, a copy of which is available on the Company's website www.aseanaproperties.com.
RESPONSIBILITY STATEMENT
The Directors of the Company confirm that to the best of their knowledge that:
a) The condensed consolidated financial statements have been prepared in accordance with IAS 34 (Interim Financial Reporting);
b) The interim management report includes a fair review of the information required by DTR 4.2.7R (indication of important events during the first six months and description of principal risks and uncertainties for the remaining six months of the year); and
c) The interim management report includes a fair review of the information required by DTR 4.2.8R (disclosure of related party transactions and changes therein).
On behalf of the Board
Mohammed Azlan Hashim
Director
31 August 2018
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
END
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