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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Grand Vision Media Holdings Plc | LSE:GVMH | London | Ordinary Share | GB00BDHBGL97 | ORD 10P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 1.50 | 1.00 | 2.00 | 1.50 | 1.50 | 1.50 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Offices-holdng Companies,nec | 4.24M | -5.72M | -0.0594 | -0.25 | 1.44M |
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TIDMGVMH
London, 30 April 2019
Grand Vision Media Holdings plc
( "GVMH" or the "Company")
Final results
The CEO's Report
In the year to 31 December 2018, The Company made a total comprehensive loss in
the period of HK$ 32,291K which was mainly due to the costs relating to the
acquisition of GVC Holdings Limited and admission to trading on the main
market.
Cash in hand at the period end was HK$ 2,552K.
Background
The Company successfully completed the acquisition of GVC Holdings Limited
("GVC") on 19 June 2018, and Jonathan Lo was appointed to the Board as Chief
Executive Officer. The Company changed its name to Grand Vision Media Holdings
Plc and raised GBP1,010,000 by the issue of new shares. The new combined group
(the "Group") is now focussed on the development of the GVC business.
This exciting achievement will provide the resources and profile to build out
the business by furthering our penetration of the Chinese market and enhancing
our products and services.
As an integrated out-door digital media company we are deploying innovative
display and marketing technologies at strategic, high-traffic locations. Our
glasses-free 3D technology in digital out-of-home media is enabling advertisers
to engage with affluent consumers with a new visual experience. Our "space
management" approach utilising the cinema space for events and exhibitions
offers a total solution to our advertisers, with the potential of direct
conversion to sales.
The digital out of home (OOH) advertising market is growing, and will continue
to grow in the foreseeable future, and we want to be at the forefront of that
growth by providing our customers ( both domestic Chinese companies and
international brands) with the ability to reach Chinese as they become more
affluent and seek access to quality products and services. Our network now
covers over consumers locations covering provinces in China and we strive to
continue our expansion in China and beyond.
Summary of Trading Results
GVMH Consolidated Results
The accounts for GVMH for the 12 months ended 31 December 2018 have been
prepared under the reverse acquisition accounting principle. Revenue in the
period was HKD18,026K. The group had a loss before tax of HKD 33,063K. The
expenses in the period included the costs of the reverse takeover transaction.
GVMH Results for the 12 Months to 31 December 2018
Revenue in the period was HKD18,026K (2017 : HKD9,514K), representing an
increase of 89%. This was mainly as a result of the increased locations in the
period resulting in more advertising revenue as well as the growth in digital
marketing and ecommerce. The number of panels increased to over 180,
representing a growth of over 55% 2017. We also had an increase in advertising
revenue from overseas clients as we appoint strategic partners in countries
like Japan and Korea. GVC had a loss before tax in the period of HKD 15,886K
(H1 2017 : HKD11,814K).
Outlook
The digital signage market globally is expected to reach almost $30bn by 2024,
compared to approximately $15bn in 2015*. We believe that this growth will be
driven not only by new, higher resolution displays and new types of technology,
but also by interacting digital displays with customers' smart phones. We
believe that we are well placed to benefit from this growth and will continue
to develop our business in line with our strategy.
Two significant trends that are benefitting our growth are outbound travel and
the Chinese appetite for foreign products. The Group is well positioned to
take advantage of this trend, acquiring many international brands and travel
destinations as direct customers.
Principal Risks and Uncertainties
The Directors consider the following risk factors to be of relevance to the
Group's activities. It should be noted that the list is not exhaustive and that
other risk factors not presently known or currently deemed immaterial may
apply. The risk factors are summarised below:
i. Development Risk
The Group's development will be, in part, dependent on the ability of the
Directors to continue to expand the current business and identify suitable
investment opportunities and to implement the Group's strategy. There is no
assurance that the Group will be successful in the expansion of the business,
which is dependent on raising sufficient capital.
ii. Sector Risk
The OOH media sector is subject to competition from other marketing channels
and technologies, particularly the impact of digital marketing.
We also compete with other OOH media locations, such as traffic hubs, elevators
and other locations, which are more established.
There is a risk of 3D technology not being well received, given that it is a
new media platform in the OOH sector.The Company is continuously looking for
new and innovative platforms to differentiate itself, and there is no guarantee
that these new platforms will be effective.
iii. Political and Regulatory Risk
Furthermore, prior to distributing advertisements for certain commodities,
advertising distributors and advertisers are obligated to ensure compliance to
relevant regulations.Violation of these regulations may result in penalties,
including fines, confiscation of advertising income, orders to cease
dissemination of the advertisements and orders to publish an advertisement
correcting the misleading information. In circumstances involving serious
violations, the SAIC or its local branches may revoke violators' licenses or
permits for advertising business operations. In addition, advertisers,
advertising operators or advertising distributors may be subject to civil
liability if they infringe on the legal rights and interests of third parties
in the course of their advertising business. TheGroup has implemented
procedures to ensure the content of our advertisement are properly reviewed and
the advertisement would only be published upon the receipt of content approval
from the relevant administrative authorities. However, the Group can provide no
assurance that all the content of the advertisements is true and in full
compliance with applicable laws.
In the event that theGroup was in violation of such regulations the business,
financial condition, results of operations and the prospects of theGroup could
be materially and adversely affected.
iv. Environmental Risks and Hazards
All phases of the Group's operations are subject to environmental regulation in
the areas in which it operates. Environmental legislation is evolving in a
manner that may require stricter standards and enforcement, increased fines and
penalties for non-compliance, more stringent environmental assessments of
proposed projects and a heightened degree of responsibility for companies and
their officers, directors and employees.
There is no assurance that existing or future environmental regulation will not
materially adversely affect the Group's business, financial condition and
results of operations. Environmental hazards may exist on the properties on
which the Group holds interests that are unknown to the Group at present. The
Board manages this risk by working with environmental consultants and by
engaging with the relevant governmental departments and other concerned
stakeholders.
v. Internal Control and Financial Risk Management
The Board has overall responsibility for the Group's systems of internal
control and for reviewing their effectiveness. The Group maintains systems
which are designed to provide reasonable but not absolute assurance against
material loss and to manage rather than eliminate risk.
The key features of the Group's systems of internal control are as follows:
o Management structure with clearly identified responsibilities;
o Production of timely and comprehensive historical management information
presented to the Board;
o Detailed budgeting and forecasting;
o Day to day hands on involvement of the Executive Directors and Senior
Management; and
o Regular board and meetings and discussions with the Non-executive directors.
The Group's activities expose it to several financial risks including cash flow
risk, liquidity risk and foreign currency risk.
vi. Environmental Policy
The Group is aware of the potential impact that its subsidiary and associate
companies may have on the environment. The Group ensures that it complies with
all local regulatory requirements and seeks to implement a best practice
approach to managing environmental aspects.
vii. Health and Safety
The Group's aim is to achieve and maintain a high standard of workplace safety.
In order to achieve this objective, the Group provides ongoing training and
support to employees and sets demanding standards for workplace safety.
viii. Financing Risk
The development of the Group's business may depend upon the Group's ability to
obtain financing primarily through the raising of new equity capital or debt.
The Group's ability to raise further funds may be affected by the success of
existing and acquired investments. The Group may not be successful in procuring
the requisite funds on terms which are acceptable to it (or at all) and, if
such funding is unavailable, the Group may be required to reduce the scope of
its investments or the anticipated expansion. Further, Shareholders' holdings
of Ordinary Shares may be materially diluted if debt financing is not
available.
ix. Credit Risk
The Group does not have bank loans or other borrowings except for shareholder
loans.The Group has benefitted from further shareholder loans, although there
is no guarantee that these will continue in the future. We have reviewed the
accounts receivable and have made adequate provisions as appropriate.
x. Liquidity Risk
The Directors have reviewed the working capital forecasts for the Group and
believe that there is sufficient working capital to fund the business as it
progresses to break even. The group is reliant on raising new capital for
expansion, which is not guaranteed.
xi. Market Risk
The group's investments is in its subsidiary, GVC Holdings Ltd. The shares are
not readily tradable.
xii. Capital Risk
The Group manages its capital resources to ensure that entities in the Group
will be able to continue as a going concern, while maximising shareholder
return.
The capital structure of the Group consists of equity attributable to
shareholders, comprising issued share capital and reserves. The availability of
new capital will depend on many factors including a positive operating
environment, positive stock market conditions, the Group's track record, and
the experience of management. There are no externally imposed capital
requirements.The Directors are confident that adequate cash resources exist or
will be made available to finance operations but controls over expenditure are
carefully managed.
Going Concern
The day to day working capital requirements and investment objectives are met
by existing cash resources and the issue of equity. At 31 December 2018 the
Group had cash balance of HKD2,552k. The Group's forecasts and projections,
taking into account reasonably possible changes in the level of overhead costs,
show that the company should be able to operate within its available cash
resources but only with shareholder help. The directors have, at the time of
approving the financial statements, a reasonable expectation that the Group has
adequate resources to continue in existence for the foreseeable future. They
therefore continue to adopt the going concern basis of accounting in preparing
the financial statements.
On behalf of the board
Jonathan Lo
Chief Executive Officer
30 April 2019
The full accounts are published below and will be posted on the Company's
website and to shareholders this week.
For more information:
Grand Vision Media Holdings plc http://gvmh.co.uk/
Edward Kwan-Mang Ng, Director Tel: +44 (0) 20 7866 2145
or info@gvmh.co.uk
Alfred Henry Corporate Finance Ltd
Nick Michaels / Jon Isaacs Tel: +44 (0) 20 3772 0021
or enquiries@alfredhenry.com
GRAND VISION MEDIA HOLDINGS PLC
(Formerly SIMIAN GLOBAL PLC)
DIRECTORS' REPORT AND FINANCIAL STATEMENTS
FOR THE YEARED 31 DECEMBER 2018
COMPANY INFORMATION
Directors and Advisers
Directors: Edward Kwan-Mang NG- Executive Director
Ajay Kumar Rajpal - Non-Executive
Director
Jonathan Yat Pang Lo - Chief Executive
Officer
Company Number: 10028625
Company Secretary International Registrars Limited
Finsgate
5-7 Cranwood Street
London
EC1V9EE
Registered Address: Finsgate
5-7 Cranwood Street
London
EC2M 7LD
Principal Banker: Metro Bank
227 Tottenham Court Road
London
W1T 7QF
Financial Adviser: Alfred Henry Corporate Finance Limited
Finsgate
5-7 Cranwood Street
London
EC1V 9EE
Auditors: Jeffreys Henry LLP
Finsgate
5-7 Cranwood Street
London
EC1V 9EE
Legal Adviser to the Company: Bracher Rawlins
77 Kingsway
London
WC2B 6SR
Registrar: SLC Registrars Limited
Ashley Park House
42-50 Hersham Road
Walton-on-Thames
Surrey
KT12 1RZ
GRAND VISION MEDIA HOLDINGS PLC
CONTENTS
Strategic review report 4
Directors' report 8
Independent auditors' report 13
Statement of comprehensive income 19
Statement of financial position 20
Statement of cash flows 21
Statement of changes in equity 23
Notes to the financial statements 24
STRATEGIC REVIEW REPORT
FOR THE YEARED 31 DECEMBER 2018
The CEO Report
In the year to 31 December 2018, The Company made a total comprehensive loss in
the period of HK$ 32,291K which was mainly due to the costs relating to the
acquisition of GVC Holdings Limited and admission to trading on the main
market.
Cash in hand at the period end was HK$ 2,552K.
Background
The Company successfully completed the acquisition of GVC Holdings Limited
("GVC") on 19 June 2018, and Jonathan Lo was appointed to the Board as Chief
Executive Officer. The Company changed its name to Grand Vision Media Holdings
Plc and raised GBP1,010,000 by the issue of new shares. The new combined group
(the "Group") is now focussed on the development of the GVC business.
This exciting achievement will provide the resources and profile to build out
the business by furthering our penetration of the Chinese market and enhancing
our products and services.
As an integrated out-door digital media company we are deploying innovative
display and marketing technologies at strategic, high-traffic locations. Our
glasses-free 3D technology in digital out-of-home media is enabling advertisers
to engage with affluent consumers with a new visual experience. Our "space
management" approach utilising the cinema space for events and exhibitions
offers a total solution to our advertisers, with the potential of direct
conversion to sales.
The digital out of home (OOH) advertising market is growing, and will continue
to grow in the foreseeable future, and we want to be at the forefront of that
growth by providing our customers ( both domestic Chinese companies and
international brands) with the ability to reach Chinese as they become more
affluent and seek access to quality products and services. Our network now
covers over consumers locations covering provinces in China and we strive to
continue our expansion in China and beyond.
Summary of Trading Results
GVMH Consolidated Results
The accounts for GVMH for the 12 months ended 31 December 2018 have been
prepared under the reverse acquisition accounting principle. Revenue in the
period was HKD18,026K. The group had a loss before tax of HKD 33,063K. The
expenses in the period included the costs of the reverse takeover transaction.
GVMH Results for the 12 Months to 31 December 2018
Revenue in the period was HKD18,026K (2017 : HKD9,514K), representing an
increase of 89%. This was mainly as a result of the increased locations in the
period resulting in more advertising revenue as well as the growth in digital
marketing and ecommerce. The number of panels increased to over 180,
representing a growth of over 55% 2017. We also had an increase in advertising
revenue from overseas clients as we appoint strategic partners in countries
like Japan and Korea. GVC had a loss before tax in the period of HKD 15,886K
(H1 2017 : HKD11,814K).
Outlook
The digital signage market globally is expected to reach almost $30bn by 2024,
compared to approximately $15bn in 2015*. We believe that this growth will be
driven not only by new, higher resolution displays and new types of technology,
but also by interacting digital displays with customers' smart phones. We
believe that we are well placed to benefit from this growth and will continue
to develop our business in line with our strategy.
Two significant trends that are benefitting our growth are outbound travel and
the Chinese appetite for foreign products. The Group is well positioned to
take advantage of this trend, acquiring many international brands and travel
destinations as direct customers.
Principal Risks and Uncertainties
The Directors consider the following risk factors to be of relevance to the
Group's activities. It should be noted that the list is not exhaustive and that
other risk factors not presently known or currently deemed immaterial may
apply. The risk factors are summarised below:
xiii. Development Risk
The Group's development will be, in part, dependent on the ability of the
Directors to continue to expand the current business and identify suitable
investment opportunities and to implement the Group's strategy. There is no
assurance that the Group will be successful in the expansion of the business,
which is dependent on raising sufficient capital.
xiv. Sector Risk
The OOH media sector is subject to competition from other marketing channels
and technologies, particularly the impact of digital marketing.
We also compete with other OOH media locations, such as traffic hubs, elevators
and other locations, which are more established.
There is a risk of 3D technology not being well received, given that it is a
new media platform in the OOH sector.The Company is continuously looking for
new and innovative platforms to differentiate itself, and there is no guarantee
that these new platforms will be effective.
xv. Political and Regulatory Risk
Furthermore, prior to distributing advertisements for certain commodities,
advertising distributors and advertisers are obligated to ensure compliance to
relevant regulations.Violation of these regulations may result in penalties,
including fines, confiscation of advertising income, orders to cease
dissemination of the advertisements and orders to publish an advertisement
correcting the misleading information. In
circumstances involving serious violations, the SAIC or its local branches may
revoke violators' licenses or permits for advertising business operations. In
addition, advertisers, advertising operators or advertising distributors may be
subject to civil liability if they infringe on the legal rights and interests
of third parties in the course of their advertising business. TheGroup has
implemented procedures to ensure the content of our advertisement are properly
reviewed and the advertisement would only be published upon the receipt of
content approval from the relevant administrative authorities. However, the
Group can provide no assurance that all the content of the advertisements is
true and in full compliance with applicable laws.
In the event that theGroup was in violation of such regulations the business,
financial condition, results of operations and the prospects of theGroup could
be materially and adversely affected.
xvi. Environmental Risks and Hazards
All phases of the Group's operations are subject to environmental regulation in
the areas in which it operates. Environmental legislation is evolving in a
manner that may require stricter standards and enforcement, increased fines and
penalties for non-compliance, more stringent environmental assessments of
proposed projects and a heightened degree of responsibility for companies and
their officers, directors and employees.
There is no assurance that existing or future environmental regulation will not
materially adversely affect the Group's business, financial condition and
results of operations. Environmental hazards may exist on the properties on
which the Group holds interests that are unknown to the Group at present. The
Board manages this risk by working with environmental consultants and by
engaging with the relevant governmental departments and other concerned
stakeholders.
xvii. Internal Control and Financial Risk Management
The Board has overall responsibility for the Group's systems of internal
control and for reviewing their effectiveness. The Group maintains systems
which are designed to provide reasonable but not absolute assurance against
material loss and to manage rather than eliminate risk.
The key features of the Group's systems of internal control are as follows:
o Management structure with clearly identified responsibilities;
o Production of timely and comprehensive historical management information
presented to the Board;
o Detailed budgeting and forecasting;
o Day to day hands on involvement of the Executive Directors and Senior
Management; and
o Regular board and meetings and discussions with the Non-executive directors.
The Group's activities expose it to several financial risks including cash flow
risk, liquidity risk and foreign currency risk.
xviii. Environmental Policy
The Group is aware of the potential impact that its subsidiary and associate
companies may have on the environment. The Group ensures that it complies with
all local regulatory requirements and seeks to implement a best practice
approach to managing environmental aspects.
xix. Health and Safety
The Group's aim is to achieve and maintain a high standard of workplace safety.
In order to achieve this objective, the Group provides ongoing training and
support to employees and sets demanding standards for workplace safety.
xx. Financing Risk
The development of the Group's business may depend upon the Group's ability to
obtain financing primarily through the raising of new equity capital or debt.
The Group's ability to raise further funds may be affected by the success of
existing and acquired investments. The Group may not be successful in procuring
the requisite funds on terms which are acceptable to it (or at all) and, if
such funding is unavailable, the Group may be required to reduce the scope of
its investments or the anticipated expansion. Further, Shareholders' holdings
of Ordinary Shares may be materially diluted if debt financing is not
available.
xxi. Credit Risk
The Group does not have bank loans or other borrowings except for shareholder
loans.The Group has benefitted from further shareholder loans, although there
is no guarantee that these will continue in the future. We have reviewed the
accounts receivable and have made adequate provisions as appropriate.
xxii. Liquidity Risk
The Directors have reviewed the working capital forecasts for the Group and
believe that there is sufficient working capital to fund the business as it
progresses to break even. The group is reliant on raising new capital for
expansion, which is not guaranteed.
xxiii. Market Risk
The group's investments is in its subsidiary, GVC Holdings Ltd. The shares are
not readily tradable.
xxiv. Capital Risk
The Group manages its capital resources to ensure that entities in the Group
will be able to continue as a going concern, while maximising shareholder
return.
The capital structure of the Group consists of equity attributable to
shareholders, comprising issued share capital and reserves. The availability of
new capital will depend on many factors including a positive operating
environment, positive stock market conditions, the Group's track record, and
the experience of management. There are no externally imposed capital
requirements.The Directors are confident that adequate cash resources exist or
will be made available to finance operations but controls over expenditure are
carefully managed.
Going Concern
The day to day working capital requirements and investment objectives are met
by existing cash resources and the issue of equity. At 31 December 2018 the
Group had cash balance of HKD2,552k. The Group's forecasts and projections,
taking into account reasonably possible changes in the level of overhead costs,
show that the company should be able to operate within its available cash
resources but only with shareholder help. The directors have, at the time of
approving the financial statements, a reasonable expectation that the Group has
adequate resources to continue in existence for the foreseeable future. They
therefore continue to adopt the going concern basis of accounting in preparing
the financial statements.
On behalf of the board
Jonathan Lo
Chief Executive Officer
30 April 2019
DIRECTORS' REPORT
FOR THE YEARED 31 DECEMBER 2018
The directors present their report together with the accounts of Grand Vision
Media Holdings Plc (the company) and its subsidiary undertakings (together 'the
group') for the year ended 31 December 2018.
Investing Policy
The company was established as a mean to make an acquisition in the technology,
media and telecommunications sector via a reverse takeover. The reverse
takeover was completed in June 2018.
Results and dividends
The trading results for the year are set out in the consolidated statement of
comprehensive income and the company's financial position at the end of the
year.
The directors have not recommended a dividend.
Strategic Report
In accordance with section 414C(11) of the Companies Act 2006 the company
chooses to report the review of the business, the future outlook and the risks
and uncertainties faced by the company in the Strategic Report.
Directors
The following directors have held office during the period:
Edward Kwan-Mang Ng
Ajay Kumar Rajpal
Jonathan Yat Pang Lo (appointed 18 June 2018)
Directors' interests
At the date of this report the directors held the following beneficial interest
in the ordinary share capital and share options of the company:
Director Beneficial Shareholding Beneficial Percentage of
(Held through Cyber Lion Shareholding the Company's
Limited) ordinary Share
Capita
Edward Kwan-Mang 3,664,000 3.81%
Ng
Ajay Kumar Rajpal 3,664,000 3.81%
Jonathan Yat Pang 22,438,842 23.3%
Lo
Substantial Interests
The company has been informed of the following shareholdings that represent 3%
or more of the issued ordinary shares of the company as at 31 December 2018.
Investor Shareholding
(Ordinary shares of 10p) Percentage of the
Company's ordinary
Share Capita
Jonathan Lo 22,438,842 23.3%
Pentwood Limited 12,439,779 12.92%
Stephen lo 12,439,779 12.92%
Magic Carpet 8,064,486 8.38%
Cyber Lion Ltd 7,328,000 7.61%
Timenow Ltd 4,499,016 4.67%
Vaiatrax Holdings Ltd 3,936,639 4.09%
Tamperzem Holding Ltd 3,374,262 3.50%
Dividends
No dividends will be distributed for the current period.
Financial risk and management of capital
The major balances and financial risks to which the company is exposed to and
the controls in place to minimise those risks are disclosed in Note 18.
A description of how the company manages its capital is also disclosed in Note
17.
The Board considers and reviews these risks on a strategic and day-to-day basis
in order to minimise any potential exposure.
Financial instruments
The company has not entered into any financial instruments to hedge against
interest rate or exchange rate risk.
Auditors
Jeffreys Henry LLP were appointed auditors to the company and in accordance
with section 485 of the Companies Act 2006, a resolution proposing that they be
re-appointed will be put at a General Meeting.
Statement of directors' responsibilities
The directors are responsible for preparing the Directors' Report and the
financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare Group and parent company
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 group and company and of the group's profit or loss for that
period. In preparing these financial statements, the directors are required to:
· select suitable accounting policies and then apply them consistently;
· make judgements and accounting estimates that are reasonable and
prudent;
· state whether they have been prepared in accordance with IFRS as adopted
by the European Union
· prepare the financial statements on the going concern basis unless it is
inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are
sufficient to show and explain the company's transactions and disclose with
reasonable accuracy at any time the financial position of the group and
company. They are also responsible for safeguarding the assets of the group and
company and hence for taking reasonable steps for the prevention and detection
of fraud and other irregularities.
The Directors are responsible for the maintenance and integrity of the
corporate and financial information included on the Company's website.
Corporate Governance
The Board recognizes that good standards of corporate governance help the
Company to achieve its strategic goals and is vital for the success of the
Company. The Company adopts proper standards of corporate governance and
follows the principles of best practice set out in Corporate Governance Code
(2016) , as far as is appropriate for the size and nature of the Company and
the Group. These principles are disclosed on our website in the Corporate
Governance section
Application of principles of good governance by to board of directors
The board currently comprises the three directors: Edward Kwan-Mang Ng, Ajay
Kumar Rajpal and Jonathan Yat Pang Lo.
There are regular board meetings each year and other meetings are held as
required to direct the overall Company strategy and operations. Board meetings
follow a formal agenda covering matters specifically reserved for decision by
the board. These cover key areas of the company's affairs including overall
strategy, acquisition policy, approval of budgets, major capital expenditure
and significant transactions and financing issues.
The board undertakes a formal annual evaluation of its own performance and that
of its committees and individual directors, through discussions and one-to-one
reviews with the chairman and the senior independent director.
Directors' Remuneration Report
The information included in this section is not subject to audit other than
where specifically indicated.
The remuneration committee consists of Andrew Monk and George Roach. This
committee's primary function is to review the performance of executive
directors and senior employees and set their remuneration and other terms of
employment.
2018 2017
Director Options Options
Edward Ng 3,000,000 -
Ajay Rajpal 3,000,000 -
Jonathan Lo 6,000,000 -
Totals 12,000,000 -
The Company has one executive director.
The remuneration policy
It is the aim of the committee to remunerate executive directors competitively
and to reward performance. The remuneration committee determines the company's
policy for the remuneration of executive directors, having regard to the UK
Corporate Governance Code and its provisions on directors' remuneration.
Service agreements and terms of appointment
The directors have service contracts with the company.
Directors' interests
The directors' interests in the share capital of the company are set out in the
Directors' report.
Directors' emoluments
Salaries and Fees Group Company
2018 2017 2018 2017
HK$'000 HK$'000 HK$'000 HK$'000
Edward Ng 286 - 286 -
Ajay Rajpal 286 - 286 -
Jonathan Lo 863 - 245 -
1,435 - 817 -
No pension contributions were made by the company on behalf of its directors
apart for Jonathan Lo of HKD18K.
Approval by shareholders
At the next annual general meeting of the company a resolution approving this
report is to be proposed as an ordinary resolution.
This report was approved by the board on 30th April 2019.
Statement of disclosure to auditors
Each person who is a Director at the date of approval of this Annual Report
confirms that:
· So far as the Directors are aware, there is no relevant audit
information of which the Company's auditors are unaware; and
· Each Director has taken all the steps that he ought to have taken as
Director in order to make himself aware of any relevant audit information and
to establish that the Company's auditors are aware of that information.
· Each Director is aware of and concurs with the information included in
the Strategic Report.
Post Balance Sheet Events
Further information on events after the reporting date is set out in note 23.
Branches Outside the UK
The Group head office is in Hong Kong and the subsidiaries are located in Hong
Kong and China.
The Directors' have chosen to produce a Strategic Report that discloses a fair
review of the Group's business, the key performances metrics that the Directors
review along with a review of the key risks to the business.
In accordance with Section 414C (1) of the Companies Act 2006, the group
chooses to report the review of the business, the future outlook and the risks
and uncertainties faced by the Company in The Strategic Report on page 4.
On behalf of the board
__________________
Jonathan Lo
Director
30 April 2019
INDEPENT AUDITOR'S REPORT
TO THE MEMBERS OF GRAND VISION MEDIA HOLDINGS PLC
Opinion
We have audited the financial statements of Grand Vision Media Holdings Plc
(the 'parent company') and its subsidiaries (the 'group') for the year ended 31
December 2018 which comprise the consolidated statement of comprehensive
income, the consolidated and company statements of financial position, the
consolidated and company statements of cash flows, the consolidated and company
statements of changes in equity and notes to the financial statements,
including a summary of significant accounting policies.
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 affairs as at 31 December 2018 and of the
group's loss for the year then ended;
· the group financial statements have been properly prepared in accordance
with IFRSs as adopted by the European Union;
· the parent company financial 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 Act 2006; and
· the financial statements have been prepared in accordance with the
requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing
(UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards
are further described in the Auditor's responsibilities for the audit of the
financial statements section of our report. We are independent of the company
in accordance with the ethical requirements that are relevant to our audit of
the financial statements in the UK, including the FRC's Ethical Standard as
applied to listed entities, and we have fulfilled our other ethical
responsibilities in accordance with these requirements. We believe that the
audit evidence we have obtained is sufficient and appropriate to provide a
basis for our opinion.
Material uncertainty related to going concern
We draw attention to note 2.3 in the financial statements, which explains that
the Group has incurred significant operating losses and negative cash flows
from operations. The Group forecasts include additional funding requirements
upon which the Group is dependent. The directors are satisfied that these
funding requirements will be met. These events or conditions, along with other
matters as set out in note 2.3 indicate that a material uncertainty exists that
may cast doubt on the Group's ability to continue as a going concern. Our
opinion is not modified in respect of this matter.
Key audit matters
Key audit matters are those matters that, in our professional judgment, were of
most significance in our audit of the financial statements of the current
period and include the most significant assessed risks of material misstatement
(whether or not due to fraud) we identified, including those which had the
greatest effect on: the overall audit strategy, the allocation of resources in
the audit; and directing the efforts of the engagement team. These matters were
addressed in the context of our audit of the financial statements as a whole,
and in forming our opinion thereon, and we do not provide a separate opinion on
these matters. This is not a complete list of all risks identified by our
audit.
· Accounting for the reverse acquisitionGoing concern issues
· Carrying value of investments and recoverability of intercompany loans
· Accounting for the reverse acquisition
These are explained in more detail below:
Key audit matter How our audit addressed the key audit
matter
Possible impairment of long-term investment We have reviewed the consolidated
and loans to subsidiaries (Parent) financials of the subsidiary and having
During the year the Company had Investment reviewed the performance to date the
in subsidiary of HK$114,572K and Loans of subsidiary is profit making and is
HK$ 11,412k. continuing to grow.
The directors have assessed whether the We reviewed the latest management
investment and loans shows any indicators of accounts post year end for the
impairment. subsidiary. We have reviewed the long
term cashflow forecasts prepared and
understood and assessed the methodology
used by the directors in this analysis
and determined it to be reasonable.
We tested management's assumption that no
impairment existed by carrying out
sensitivity analysis through changing the
assumptions used and re- running the cash
flow forecast.
Going concern assumption Our audit procedures:
· We obtained and reviewed the
The Group is dependent upon its ability to directors' assessment, including
generate sufficient cash flows to meet challenging the liquidity position;
continued operational costs and hence · We agreed the assumed cash flows to
continue trading. the business plan, walked through the
Although the current loss-making status is business planning process and tested the
as expected due its relative newness, given central assumptions and external data;
the scale of cash outflows, the Group needs · We audited the key assumptions;
to be generating sufficient revenues to · We assessed the sensitivities of the
sustain its position. The going concern underlying assumptions.
assumptions is dependent on future growth of
the current business. No future capital
raises were being considered to maintain the
business.
Accounting for the reverse acquisition of We evaluated management's assessment that
GVC Holdings Limited it is the shareholders of GVC Holdings
Limited.
On 19 June 2018, Grand Vision Media Plc, a
cash shell acquired GVC Holdings Limited, We evaluated the methodology and tested
which operates as out-of-home media group as the mathematical accuracy of the
a reverse takeover under AIM rules. The calculations of the Group for the deemed
total consideration for the acquisition of consideration paid in the form of shares
the entire issued share capital of GVC to GVC Holdings Limited shareholders. We
Holdings Limited was through the issuance of corroborated the underlying information
shares. inputs, including the share prices,
exchange ratios with independent data
As the legal subsidiary is reversed into the sources and we checked the contractual
Company, which originally was a publicly agreements.
listed cash shell company, this transaction
cannot be considered a business combination, We obtained the signed contractual
as the Company, the accounting acquire does agreements relating to the reverse
not meet the definition of a business, under acquisition and read significant contract
IFRS 3 'Business Combinations'. terms relevant to the accounting and
disclosures in the financial statements.
However, the accounting for such capital
transaction should be treated as a We substantively tested journal entries
share-based payment transaction and and supporting workings and evidence
therefore accounted for under IFRS 2 relating to the accounting for the
'Share-based payment'. exchange of shares and internal
restructuring steps, agreeing them to the
contracts and to the terms of the scheme
of arrangement.
We evaluated the capital and equity
movements of both Grand Vision Media
Holdings Plc and GVC Holdings Limited,
for accuracy by comparison to the terms
of the scheme of arrangement.
Our application of materiality
The scope of our audit was influenced by our application of materiality. We set
certain quantitative thresholds for materiality. These, together with
qualitative considerations, helped us to determine the scope of our audit and
the nature, timing and extent of our audit procedures on the individual
financial statement line items and disclosures and in evaluating the effect of
misstatements, both individually and in aggregate on the financial statements
as a whole.
Based on our professional judgment, we determined materiality for the financial
statements as a whole as follows:
Group financial statements Company financial statements
Overall materiality HKD 1,512,000. HKD 1,154,000.
How we determined it 5% of Net Loss. 1% of gross assets
Rationale for We believe that loss before We believe that gross asset
benchmark applied tax is a primary measure used values are a representation of
by shareholders in assessing the size of the Company and is
the performance of the Group a generally accepted auditing
whilst gross asset values and benchmark.
revenue are a representation
of the size of the Group; all
are generally accepted
auditing benchmarks.
For each component in the scope of our Group audit, we allocated a materiality
that is less than our overall Group materiality. The range of materiality
allocated across components was between HK$75,000 and HK$388,000.
We agreed with the Audit Committee that we would report to them misstatements
identified during our audit above HK$30,000 as well as misstatements below
those amounts that, in our view, warranted reporting for qualitative reasons.
An overview of the scope of our audit
As part of designing our audit, we determined materiality and assessed the
risks of material misstatement in the financial statements. In particular, we
looked at where the directors made subjective judgments, for example in respect
of significant accounting estimates that involved making assumptions and
considering future events that are inherently uncertain. As in all of our
audits we also addressed the risk of management override of internal controls,
including evaluating whether there was evidence of bias by the directors that
represented a risk of material misstatement due to fraud.
How we tailored the audit scope
We tailored the scope of our audit to ensure that we performed enough work to
be able to give an opinion on the financial statements as a whole, taking into
account the structure of the Group and the Company, the accounting processes
and controls, and the industry in which they operate.
The Group financial statements are a consolidation of 8 reporting units,
comprising the Group's operating businesses and holding companies.
We performed audits of the complete financial information of Grand Vision Media
Holdings Plc, and GVC Holdings Ltd reporting units, which were individually
financially significant and accounted for 100% of the Group's revenue and 100%
of the Group's absolute profit before tax (i.e. the sum of the numerical values
without regard to whether they were profits or losses for the relevant
reporting units). We also performed specified audit procedures over goodwill
and other intangible assets, as well as certain account balances and
transaction classes that we regarded as material to the Group at 8 reporting
units.
Other information
The directors are responsible for the other information. The other information
comprises the information included in the annual report, other than the
financial statements and our auditor's report thereon. Our opinion on the
financial statements does not cover the other information and, except to the
extent otherwise explicitly stated in our report, we do not express any form of
assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is
to read the other information and, in doing so, consider whether the other
information is materially inconsistent with the financial statements or our
knowledge obtained in the audit or otherwise appears to be materially
misstated. If we identify such material inconsistencies or apparent material
misstatements, we are required to determine whether there is a material
misstatement in the financial statements or a material misstatement of the
other information. If, based on the work we have performed, we conclude that
there is a material misstatement of this other information, we are required to
report that fact. We have nothing to report in this regard.
Opinion on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
· the information given in the strategic report and the directors' report
for the financial year for which the financial statements are prepared is
consistent with the financial statements; and
· the strategic report and the directors' report have been prepared in
accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the group and parent company
and its environment obtained in the course of the audit, we have not identified
material misstatements in the strategic report or the directors' report.
We have nothing to report in respect of the following matters in relation to
which the Companies Act 2006 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 our audit have not been received from branches not visited
by us; or
· the parent company financial statements [and the part of the directors'
remuneration report to be audited] 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.
Responsibilities of directors
As explained more fully in the directors' responsibilities statement [set out
on page xx], the directors are responsible for the preparation of the financial
statements and for being satisfied that they give a true and fair view, and for
such internal control as the directors determine is necessary to enable the
preparation of financial statements that are free from material misstatement,
whether due to fraud or error.
Matters on which we are required to report by exception
In preparing the financial statements, the directors are responsible for
assessing the group's and parent company's ability to continue as a going
concern, disclosing, as applicable, matters related to going concern and using
the going concern basis of accounting unless the directors either intend to
liquidate the group or the parent company or to cease operations, or have no
realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial
statements as a whole are free from material misstatement, whether due to fraud
or error, and to issue an auditor's report that includes our opinion.
Reasonable assurance is a high level of assurance but is not a guarantee that
an audit conducted in accordance with ISAs (UK) will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and
are considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on
the basis of these financial statements.
A further description of our responsibilities for the audit of the financial
statements is located on the Financial Reporting Council's website at:
www.frc.org.uk/auditorsresponsibilities. This description forms part of our
auditor's report.
Other matters which we are required to address
The non-audit services prohibited by the FRC's Ethical Standard were not
provided to the group or the parent company and we remain independent of the
group and the parent company in conducting our audit.
Our audit opinion is consistent with the additional report to the audit
committee.
Use of this report
This report is made solely to the company's members, as a body, in accordance
with Chapter 3 of Part 16 of the Companies Act 2006. 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 auditor's 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.
Sanjay Parmar (Senior Statutory Auditor)
For and on behalf of Jeffreys Henry LLP (Statutory Auditors)
Finsgate
5-7 Cranwood Street
London EC1V 9EE
30 April 2019
Statements of Comprehensive Income
Group Group Company Company
For the For the For the year For the year
year year
ended ended ended ended
31 December 31 December 31 December 31 December
2018 2017 2018 2017
Note HK$'000 HK$'000 HK$'000 HK$'000
Revenue 4 18,026 9,514 - -
Cost of sales (12,140) (4,460) - -
Gross profit 5,886 5,054 - -
Other income 4 79 62 - -
5,965 5,116 - -
Administrative expenses 6 (38,711) (16,634) (12,258) (2,917)
(Loss)/profit for the period (32,746) (11,518) (12,258) (2,917)
from operations
Finance costs 5 (316) (296) - -
(Loss)/profit for the period (33,062) (11,814) (12,258) (2,917)
before tax
Income tax expense 7 - - - -
(Loss)/profit for the period (33,062) (11,814) (12,258) (2,917)
Other comprehensive income
(loss)/income
Items that are or may be - - - -
reclassified subsequently to
profit or loss
Exchange differences arising on 772 127 672 -
translation of foreign
operations
Total comprehensive (loss)/ (32,290) (11,687) (11,586) (2,917)
income for the period
(Loss)/ profit attributable to
Equity holders of parent (33,069) (11,784) (11,586) (2,917)
company
Non-controlling interests 7 (30) - -
(33,062) (11,814) (11,586) (2,917)
Total comprehensive (loss) / income
attributable to:
Equity holders of the parent (33,297) (11,657) (11,586) (2,917)
company
Non-controlling interests 7 (30) - -
(32,290) (11,687) (11,586) (2,917)
Earnings/(loss) per shares - 8 (0.34) (944) (0.12) (0.48)
Basic and diluted HK$
Statements of financial position
Group Group Company Company
As at As at As at As at
31 December 31 December 31 December 31 December
2018 2017 2018 2017
Notes HK$'000 HK$'000 HK$'000 HK$'000
Assets
Non-current assets
Property, plant and equipment 9 2,183 6,165 - -
Investment in Subsidiaries - - 114,572 -
Total non-current assets 2,183 6,165 114,572 -
Current assets
Inventories 10 1,707 2,826 - -
Trade and other receivables 11 5,104 3,821 48 -
Deposits and prepayments 11 1,036 672 - -
Amount due from subsidiaries 11 - - 11,412 2,637
Cash and cash equivalents 12 2,552 1,136 783 2,785
Total current assets 10,399 8,455 12,243 5,422
Total assets 12,582 14,620 126,815 5,422
Equity and liabilities
Equity
Share capital 17 96,017 97 96,017 6,572
Share premium 44,106 18,707 44,106 2,706
Group Re-organization Reserve (96,631) (9,060) - -
Capital Contribution arising - 844 - -
from Shareholder's Loan
Other Reserves 1,447 - 1,447 -
Exchange Reserves 449 133 - -
Accumulated deficit (54,215) (21,918) (15,571) (3,985)
Equity attributable to owners (3,676) (11,197) 125,999 5,292
of the parent
Non-controlling interests (3,410) (3,417) - -
Total equity (12,237) (14,614) 125,999 5,292
Liabilities
Non-current liabilities
Shareholder loans 16 8,676 5,860 - -
Total non-current liabilities 8,676 5,860 - -
Current liabilities
Trade and other payables 13 15,728 7,601 816 130
Convertible bonds 15 - 11,670 - -
Amount due to a director 304 55 - -
Deposits received 111 4,048 - -
Total current liabilities 16,143 23,374 816 130
Total liabilities 24,819 29,234 816 130
Total equity and liabilities 12,582 14,620 126,815 5,422
Approved by the Board and authorised for issue on 30 April 2019
Jonathan Lo
Director
? Company Registration No. 10028625
Statements of Changes in Equity
Attributable to the Company
Share Share Group Other Capital Retained Total Non-controlling Total
capital premium reorganisation reserves contribution earnings interests equity
reserve reserves
HK$'000 HK$'000 HK$'000 HK$'000 HK$'000 HK$'000 HK$'000 HK$'000 HK$'000
Balance at 1 1,162 (1,068) 94 - 94
January 2017
(Loss) for the - - - - - (2,917) (2,917) - (4,079)
year
Other - - - - - - - - -
comprehensive
income
Total 1,162 - - - - (3,985) (2,823) - (2,823)
comprehensive
income
Acquisition of - - - - - - - - -
subsidiaries with
non-controlling
interests
Issue of share 5,409 2,706 - - - - 8,115 - 8,116
capital
Balance at 31 6,571 2,706 - - - (3,985) 5,292 - 5,292
December 2017
Change in equity
for 2018
(Loss) for the - - - 1,447 - (12,258) (10,811) - (10,811)
year
Other - - - - - 672 672 - 672
comprehensive
income
Total - - - 1,447 - (11,586) (10,139) - (10,139)
comprehensive
income
Issue of share 89,446 41,400 - - - - 130,846 - 130,846
capital
Balance at 31 96,017 44,106 - 1,447 - (15,571) 125,999 - 125,999
December 2018
The reorganisation reserve before 1 January 2017 primarily arises from the 100%
merger of GV Communication Limited on 1 November 2015 whereby the excess of the
fair value of the issued ordinary shares over the book value of the net assets
was transferred to this reserve.
Statements of Changes in Equity
Attributable to the Group
Share Share Reverse Other Exchange Capital Retained Total Non-controlling Total
capital premium Acquisition reserve reserve contribution earnings interests equity
reserve reserves
HK$'000 HK$'000 HK$'000 HK$'000 HK$'000 HK$'000 HK$'000 HK$'000 HK$'000 HK$'000
GVC
Balance at 1 97 18,707 (9,060) - 5 844 (10,134) 459 (3,388) (2,928)
January 2017
(Loss) for the - - - - - - (11,784) (11,784) (29) (11,814)
period
Other - - - - 127 - - 127 - 127
comprehensive
income
Total - - - - 127 - (11,784) (11,784) (29) (11,687)
comprehensive
income
Balance at 31 97 18,707 (9,060) - 132 844 (21,918) (11,197) (3,417) (14,614)
December 2017
GVMH PLC
Balance at 19 99,782 45,835 - - - - (21,918) 123,699 - 123,699
June 2018
Capital - 844 - - (844) - - - -
Contribution
Share issue (3,765) - - - - - - (3,765) - (3,765)
Share Premium - (1,729) - - - - - (1,729) - (1,729)
Re-Organization - - (97,475) - - - - (97,475) - (97,475)
Reserve
Exchange - - - - 449 - - 449 - 449
Reserve
Share based - - - 1,447 - - - 1,447 - 1,447
payment
Non-Controlling - - - - - - - - 7 7
Interest
Loss for the - - - - - - (32,297) (32,297) - (32,297)
period
Balance at 31 96,017 44,106 (96,631) 1,447 449 - (54,215) (8,827) (3,410) (12,237)
December 2018
Share capital is the amount subscribed for shares at nominal value.
The share premium has arisen on the issue of shares at a premium to their
nominal value.
Share-based payments reserve relate to the charge for share-based payments in
accordance with IFRS 2.
Retained earnings represent the cumulative loss of the Group attributable to
equity shareholders.
The reverse acquisition reserve arose in June 2018 on the reverse acquisition
by GVC.
Statements of Cash flows
Group Group Company For Company
For the For the the year For the year
year year
ended ended ended ended
31 December 31 December 31 December 31 December
2018 2017 2018 2017
HK$'000 HK$'000 HK$'000 HK$'000
Operating activities
(Loss)/ profit before taxation (33,062) (11,814) (12,258) (2,917)
Adjustments for:
Depreciation 3,982 6,972 - 970
Loss on disposal of property, plant - 5 - -
and equipment
Share based payment 1,447 - 1,447 -
Premium on reverse acquisition 5,259
Cyber Lion Limited - Non Cash success 7,024 - 7,024 -
fee
Finance costs 316 291 - 364
Capitalisation of shareholders' loan - - - 51
Share of non-controlling interests - - - (2,399)
Merger of subsidiaries - - - (9,041)
Operating loss before changes in (15,034) (4,546) (3,787) (12,972)
working capital
Increase/(decrease) in inventories 1,119 (2,422) - -
Increase in trade and other 1,270 (2,299) (8,823) (1,119)
receivables
Decrease/ (increase) in amount due 257 - - 11,946
from related companies
Decrease/ (increase) in deposits and 7,857 4,247 - (799)
prepayments
Increase in convertible bonds - 11,670 - -
Increase in trade and other payables 2,848 (6,025) 688 2,705
Cash generated from/(used in) (17,397) 625 (11,922) (239)
operating activities
Investing activities
Payment for purchase of property, (47) (245) - (2,543)
plant and equipment
Acquisition net of bank balance 6,032
Net cash (outflow)/ inflow from 5,985 (245) - (2,543)
investing activities
Financing activities
Net proceeds from issue of shares 6,714 - 6,714 -
Net proceeds from share premium 3,357 - 3,357 -
(Repayment of) /proceeds from 2,500 500 - 3,600
shareholder loans
Net cash generated from Financing 12,571 500 10,071 3,600
activities
Net increase/(decrease) in cash and 1,159 880 (1,851) 818
cash equivalents
Cash and cash equivalents at 1 1,136 129 2,785 2
January
Effect of foreign exchange rate 257 127 (151) 12
changes
Cash and cash equivalents at 31 2,552 1,136 783 832
December
Represented by:
Bank balance and cash 2,552 1,136 783 832
Notes to the financial statements
1. Reporting entities
The Company is a UK incorporated entity with a registered number of
10028625. GVMH's head office is in Honk Kong from where it is managed. These
consolidated financial statements comprise GVMH and its subsidiaries. GVMH and
its subsidiaries are primarily involved in social media marketing.
2. Accounting policies
2.1. Statement of compliance
The consolidated financial statements have been prepared in accordance with
International Financial Reporting Standards ("IFRS") as adopted by the EU.
2.2. Basis of preparation of the financial statements
The consolidated financial statements consolidate those of the Company and its
subsidiaries (together the "Group" or "Grand Vision Media Holdings Plc"). The
consolidated financial statements of the Group and the individual financial
statements of the Company are prepared in accordance with applicable UK law and
International Financial Reporting Standards ("IFRS") as adopted by the European
Union and as applied in accordance with the provisions of the Companies Act
2006. The Directors consider that the financial information presented in these
Financial Statements represents fairly the financial position, operations and
cash flows for the period, in conformity with IFRS.
The consolidated financial statements include the financial statements of the
Company and its subsidiaries and associated undertakings. All of the
subsidiaries have the same reporting date of 31 December.
2.3. Application of new and revised International Financial Reporting
Standards (IFRSs)
Changes in accounting policies and disclosures
(a) New and amended standards adopted by the Group
The Group has applied any applicable new standards, amendments to standards and
interpretations that are mandatory for the financial year beginning on or after
1 January 2018 including IFRS 15 and IFRS 9.
The nature and impact of amendment is described below:
IFRS 15 Revenue from Contracts with Customers
IFRS 15 supersedes 1AS 11 Construction Contracts, lAS 18 Revenue and related
Interpretations and it applies, with limited exceptions, to all revenue arising
from contracts with its customers. IFRS 15 establishes a five-step model to
account for revenue arising from contracts with customers and requires that
revenue be recognised at an amount that reflects the consideration to which an
entity expects to be entitled in exchange for transferring goods or services to
a customer.
IFRS 15 requires entities to exercise judgement, taking into consideration all
of the relevant facts and circumstances when applying each step of the model to
contracts with their customers. The standard also specifies the accounting for
the incremental costs of obtaining a contract and the costs directly related to
fulfilling a contract. In addition, the standard requires extensive
disclosures.
The major sources of revenue of the Group arc provision of services. Under IFRS
15, revenue is recognised for each of the performance obligations when control
over a good or service is transferred to a customer. The directors of the Group
have assessed each type of the performance obligations and consider that the
performance obligations are similar to the previous identification of separate
revenue components under IAS 18 Revenue. Furthermore, IFRS 15 requires the
transaction price to be allocated to each performance obligation on a relative
standalone selling price basis, which may affect the timing and amounts of
revenue recognition, and results in more disclosures in the consolidated
financial statements. However, the directors of the Group consider that the
adoption of IFRS 15 do not have a material impact on the timing and amounts of
revenue recognised based on the previous business model of the Group.
(b) New, amended standards, interpretations not adopted by the Group
A number of new standards, amendments to standards and interpretations to
existing standards have been published that are mandatory for the Group's
accounting periods beginning after 1 January 2018, or later periods, where the
Group intends to adopt these standards, if applicable, when they become
effective. The Group has disclosed below those standards that are likely to be
applicable to the Group and is currently assessing the impact of these
standards.
* IFRS 16 Lease, effective date 1 January 2019 sets out the principles
for the recognition, measurement, presentation and disclosure of leases for
both parties to a contract, i.e. the customer ('lessee') and the supplier
('lessor'). IFRS 16 completes the IASB's project to improve the financial
reporting of leases and replaces the previous leases Standard, IAS 17 Leases,
and related Interpretations.
* IFRIC 23 "Uncertainty over Income Tax Treatments", effective date 1
January 2019 clarifies application of recognition and measurement requirements
in IAS 12 Income Taxes when there is uncertainty over income tax treatments.
Management has not yet fully assessed the impact of these standards but does
not believe they will have a material impact on the financial statements.
New and revised IFRSs in issue but not yet effective
GVMH PLC and its subsidiaries has not applied the following new and revised
IFRSs that have been issued but are not yet effective:
Application date of
Reference Title Summary standard (Periods
commencing on or after)
IFRS 2 Leases Original issue 01 January 2019
IFRS 9 Prepayment features 01 January 2019
with Negative
Compensation
IFRS 11 Joint Arrangements Annual Improvements 01 January 2019
2015-2017 Cycle
IAS 12 Income Taxes Annual Improvements 01 January 2019
2015-2017 Cycle
IAS 19 Plan Amendment, 01 January 2019
Curtailment or
settlement
IAS 23 Borrowing Costs Annual Improvements 01 January 2019
2015-2017 Cycle
IAS 28 Long term interests 01 January 2019
in associates and
joint ventures
Foreign currency
The functional currency of the Group is Hong Kong Dollars (HKD), its
subsidiaries are also in HKD. The presentational currency of the Group is HKD
because a significant amount of its transactions are in HKD.
Transactions entered by the Group's entities in a currency other than the
reporting currency are recorded at the rates ruling when the transaction occur.
Foreign currency monetary assets and liabilities are translated at the rates
ruling at the statement of financial position date. Exchange differences
arising on the re-translation of outstanding monetary assets and liabilities
are also recognised in the income statement.
Going concern
The Group meets its day to day working capital requirement through use of cash
reserves and existing shareholder loans. The Directors have considered the
applicable of the going concern basis in the preparation of the financial
statements. This included the review of internal budgets and financial results
which show, taking into account reasonable provide chance in the financial
performance that the Group should be able to operate within the level of its
current funding arrangement. The Directors have reasonable expectation that the
Group has adequate resources to continue operation for the foreseeable future
for the reason they have adopted to going concern basis in the preparation of
financial statement.
The Group incurred a loss of HK 32,290,000 for the year ended 31 December 2018.
This condition indicates the existence of a material uncertainty which may cast
significant doubt on the Company's ability to continue as a going concern.
Therefore, the Company may be unable to realise its assets. The financial
statements do not include any adjustments that would result if the Group was
unable to continue as a going concern.
2.4. Subsidiaries and non-controlling interests and GVMH PLC and its
subsidiaries reorganisation accounting
Subsidiaries are all entities over which Grand Vision Media Holdings Plc has
the power to govern the financial and operating policies generally accompanying
a shareholding of more than one half of the voting rights. The existence and
effect of potential voting rights that are currently exercisable or convertible
are considered when assessing whether the Group controls another entity.
Subsidiaries are fully consolidated from the date on which control is
transferred to the Company. They are de-consolidated from the date that control
ceases.
In June 2018, Grand Vision Media Holdings Plc ("Company") acquired the entire
issued share capital of GVC Holdings Limited ("legal subsidiary") in exchange
of issuance of shares to GVC Holdings Limited. As the legal subsidiary is
reversed into the Company (the legal parent), which originally was a publicly
listed cash shell company, this transaction cannot be considered a business
combination, as the Company, the accounting acquiree does not meet the
definition of a business, under IFRS 3 'Business Combinations'. However, the
accounting for such capital transaction should be treated as a share- based
payment transaction and therefore accounted for under IFRS 2 'Share-based
payment'. Any difference in the fair value of the shares deemed to have been
issued by the GVC Holdings Limited (accounting acquirer) and the fair value of
Grand Vision Media Holdings PLC's (the accounting acquiree) identifiable net
assets represents a service received by the accounting acquirer.
Although the consolidated financial information has been issued in the name of
Grand Vision Media Holdings PLC, the legal parent, it represents in substance
continuation of the financial information of the legal subsidiary.
The assets and liabilities of the legal subsidiary are recognized and measured
in the Group financial statements at the pre-combination carrying amounts and
not re-stated at fair value.
The retained earnings and other reserves balances recognized in the Group
financial statements reflect the retained earnings and other reserves balances
of the legal subsidiary immediately before the business combination and the
results of the period from June 2018 to the date of the business combination
are those of the legal subsidiary only.
The equity structure (share capital and share premium) appearing in the Group
financial statements reflects the equity structure of Grand Vision Media
Holdings PLC the legal parent. This includes the shares issued in order to
effect the business combination.
2.5. Available-for-sale investments
Available-for-sale investments represent an investment in the securities. At
the end of each reporting period the fair value is remeasured, with any
resultant gain or loss being recognised in other comprehensive income and
accumulated separately in equity in the fair value reserve. As an exception to
this, investments in equity securities that do not have a quoted price in an
active market for an identical instrument and whose fair value cannot otherwise
be reliably measured are recognised in the statement of financial position at
cost less impairment losses. Dividend income from equity securities and
interest income from debt securities calculated using the effective interest
method are recognised in profit or loss in accordance with the policies.
Foreign exchange gains and losses resulting from changes in the amortised cost
of debt securities are also recognised in profit or loss.
When the investments are derecognised or impaired, the cumulative gain or loss
recognised in equity is reclassified to profit or loss. Investments are
recognised/derecognised on the date GVMH PLC and its subsidiaries commits to
purchase/sell the investments or they expire.
2.6. Property, plant and equipment
The property, plant and equipment are stated at cost less accumulated
depreciation and impairment losses. Gains or losses arising from the retirement
or disposal of an item of property, plant and equipment are determined as the
difference between the net disposal proceeds and the carrying amount of the
item and are recognised in profit or loss on the date of retirement or
disposal.
Depreciation is calculated to write off the cost of items of property, plant
and equipment, less their estimated residual value, if any, using the
straight-line method over their estimated useful lives as follows:
Display panels and CMS 30% - 33.33%
Computer equipment 30% - 33.33%
Furniture's and fixtures 30% - 33.33%
Leasehold improvements 30% - 50%
Both the useful life of an asset and its residual value, if any, are reviewed
annually.
The carrying value of the property, plant and equipment is compared to the
higher of value in use and the fair value less costs to sell. If the carrying
value exceeds the higher of the value in use and fair value less the costs to
sell the asset, then the asset is impaired and its value reduced by recognising
an impairment provision.
2.7. Impairment of non-financial assets, other than inventories
At the end of each reporting period, property, plant and equipment and
investments in a subsidiary are reviewed to determine whether there is any
indication that those assets have suffered an impairment loss. If there is an
indication of possible impairment, the recoverable amount of any affected asset
(or GVC Holdings Ltd and its subsidiaries of related assets) is estimated and
compared with its carrying amount. If an estimated recoverable amount is lower,
the carrying amount is reduced to its estimated recoverable amount, and an
impairment loss is recognised immediately in profit or loss.
If an impairment loss subsequently reverses, the carrying amount of the asset
(or GVC Holdings Ltd and its subsidiaries of related assets) is increased to
the revised estimate of its recoverable amount, but not in excess of the amount
that would have been determined had no impairment loss been recognised for the
asset (GVC Holdings Ltd and its subsidiaries of related assets) in prior years.
A reversal of an impairment loss is recognised immediately in profit or loss.
2.8. Inventories
Inventories are valued at the lower of cost and net realisable value. Cost is
calculated using the weighted average cost formula and comprises all costs of
purchase, costs of conversion and other costs incurred in bringing the
inventories to their present location and condition. Net realisable value is
the estimated selling price in the ordinary course of business less the
estimated costs to completion and the estimated costs necessary to make the
sale.
When inventories are sold, the carrying amount of those inventories is
recognised as an expense in the period in which the related revenue is
recognised. The amount of any write-down of inventories to net realisable value
and all losses of inventories are recognised as an expense in the period the
write down or loss occurs. The amount of any reversal of any write-down of
inventories is recognised as a reduction in the amount of inventories
recognised as an expense in the period in which the reversal occurs.
2.9. Trade and other receivables
The Group classifies all its financial assets as trade and other receivables.
The classification depends on the purpose for which the financial assets
were acquired.
Trade receivables and other receivables that have fixed or determinable
payments that are not quoted in an active market are classified as loans and
receivables financial assets. Loans and receivables financial assets are
measured at amortised cost using the effective interest method, less any
impairment loss.
The Group's loans and receivables financial assets comprise other receivables
(excluding prepayments) and cash and cash equivalents included in the Statement
of Financial Position.
2.10. Cash and cash equivalents
Cash and cash equivalents comprise cash and bank balance. Bank overdrafts that
are repayable on demand and form an integral part of GVMH PLC's cash management
are also included as a component of cash and cash equivalents for the purpose
of the consolidated cash flow statement.
2.11. Trade and other payables
Trade and other payables are initially recognised at fair value. They are
subsequently measured at amortised cost using the effective interest method
unless the effect of discounting would be immaterial, in which case they are
stated at cost.
2.12. Shareholders loan
Shareholders loans are initially recognised at fair value. They are
subsequently measured at amortised cost using the effective interest method.
The difference between the fair value and the carrying amortised cost (i.e. the
effective interest portion) is first recognized in equity as capital
contribution reserve.
2.13. Employee benefits
Short-term benefits
Wages, salaries, paid annual leave and sick leave, bonuses and non-monetary
benefits are accrued in the period in which the associated services are
rendered by employees of the Group.
2.14. Taxation
(i) Current tax
The tax currently payable is based on taxable profit for the period. Taxable
profit differs from 'profit before tax' as reported in the statement of profit
or loss because of items of income or expense that are taxable or deductible in
other periods and items that are never taxable or deductible. Grand Vision
Media Holding Plc's current tax is calculated using rates that have been
enacted during the reporting period
(ii) Deferred tax
Deferred tax assets and liabilities are recognised where the carrying amount of
an asset or liability in the statement of financial position differs from its
tax base, except for differences arising on:
* the initial recognition of goodwill;
* 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 or taxable profit; and
* investments in subsidiaries where the Group is able to control the
timing of the reversal of the difference and it is probable that the difference
will not reverse in the foreseeable future.
Recognition of deferred tax assets is restricted to those instances where it is
probable that taxable profit will be available against which the difference can
be utilised.
The amount of the asset or liability is determined using tax rates that have
been enacted or substantially enacted by the balance sheet date and are
expected to apply when the deferred tax liabilities or assets are settled or recovered. Deferred tax balances are not discounted. Deferred tax assets and liabilities are offset when the Group has a legally enforceable right to offset current tax assets and liabilities. The Group is entitled to a tax deduction on the exercise of certain employee share options. A share-based payment expense is recorded in the income statement over the period from the grant date to the vesting date of the relevant options. As there is a temporary difference between the accounting and tax bases, a deferred tax asset may be recorded. The deferred tax asset arising on share option awards is calculated as the estimated amount of tax deduction to be obtained in the future (based on the Group's share price at the balance sheet date) pro-rated to the extent that the services of the employee have been rendered over the vesting period. If this amount exceeds the cumulative amount of the remuneration expense at the statutory rate, the excess is recorded directly in equity, against retained earnings. Similarly, current tax relief in excess of the cumulative amount of the Share-based payments expense at the statutory rate is also recorded in retained earnings. 2.15. Provision and contingent liabilities Provisions are recognised for other liabilities of uncertain timing or amount when GVMH PLC and its subsidiaries or GVMH PLC has a legal or constructive obligation arising as a result of a past event, it is probable that an outflow of economic benefits will be required to settle the obligation and a reliable estimate can be made. Where the time value of money is material, provisions are stated at the present value of the expenditure expected to settle the obligation. Where it is not probable that an outflow of economic benefits will be required, or the amount cannot be estimated reliably, the obligation is disclosed as a contingent liability, unless the probability of outflow of economic benefits is remote. Possible obligations, whose existence will only be confirmed by the occurrence or non-occurrence of one or more future events are also disclosed as contingent liabilities unless the probability of outflow of economic benefits is remote. 2.16. Revenue recognition After the adoption of IFRS 15, the company recognise revenue from contracts with customers when (or as) the company satisfies a performance obligation by transferring a promised good or service (i.e. an asset) to a customer. An asset is transferred When (or as) the customer obtains control of that asset. When (or as) a performance obligation is satisfied, the company recognises as revenue the amount of the transaction price (which includes estimates of variable consideration that are constrained in accordance with IFRS 15) that is allocated to that performance obligation. Further details of the company's revenue and other income recognition policies are as follows: (i) Service income is recognised as income on a straight-line based over the term, unless another systematic basis is more representative of the time pattern of the user's benefit. (ii) Barter revenueis recognised only when the goods or services being exchanged are of a dissimilar nature. Barter revenue is measured at the fair value of goods or services rendered, adjusted by the amount of cash or cash equivalents received or paid. If the fair value of the goods or services rendered cannot be relaibly measured, the revenue is measured at the fair value of the goods or services received, again adjusted by the amount of cash or cash equivalents received (iii) Interest income is recognised on a time-proportion basis using the effective interest method. When a loan and receivable is impaired, the group reduces the carrying amount to its recoverable amount, being the estimated future cash flow discounted at the original effective interest rate of the instrument, and continues unwinding the discount as interest income. Interest income on impaired loan and receivables is recognised using the original effective interest rate. 2.17. Translation of foreign currencies Foreign currency transactions during the year are translated at the foreign exchange rates ruling at the transaction dates. Monetary assets and liabilities denominated in foreign currencies are translated at the foreign exchange rates ruling at the end of the reporting period. Exchange gains and losses are recognised in profit or loss. Non-monetary assets and liabilities that are measured in terms of historical cost in a foreign currency are translated using the foreign exchange rates ruling at the transaction dates. Non-monetary assets and liabilities denominated in foreign currencies that are stated at fair value are translated using the foreign exchange rates ruling at the dates the fair value was measured. The results of foreign operations are translated into Hong Kong dollars at the exchange rates approximating the foreign exchange rates ruling at the dates of the transactions. Statement of financial position items, including goodwill arising on consolidation of foreign operations, are translated into Hong Kong dollars at the closing foreign exchange rates at the end of the reporting period. The resulting exchange differences are recognised in other comprehensive income and accumulated separately in equity in the exchange reserve. On disposal of a foreign operation, the cumulative amount of the exchange differences relating to that foreign operation is reclassified from equity to profit or loss when the profit or loss on disposal is recognised. 2.18. Borrowing costs Borrowing costs represented a notional interest on shareholders' loan, which is accrued on time proportion basis taking into account of the shareholder loan outstanding and the interest applicable. 2.19. Cash and cash equivalents Cash and cash equivalents include cash in hand and deposits held on call, together with other short term highly liquid investments which are not subject to significant changes in value and have original maturities of less than three months. Bank overdrafts are shown within borrowings in current liabilities on the Statement of Financial Position. 2.20. Related parties a) A person, or a close member of that person's family, is related to GVMH PLC and its subsidiaries if that person: (i) has control or joint control over GVMH PLC and its subsidiaries; (ii) has significant influence over GVMH PLC and its subsidiaries; or (iii) is a member of the key management personnel of GVMH PLC and its subsidiaries or GVMH PLC and its subsidiaries' parent. b) An entity is related to GVMH PLC and its subsidiaries if any of the following conditions applies: (i) The entity and GVMH PLC and its subsidiaries are members of the same GVMH PLC and its subsidiaries (which means that each parent, subsidiary and fellow subsidiary is related to the others). (ii) One entity is an associate or joint venture of the other entity (or an associate or joint venture of a member of a GVMH PLC and its subsidiaries of which the other entity is a member). (iii) Both entities are joint ventures of the same third party. (iv) One entity is a joint venture of a third entity and the other entity is an associate of the third entity. (v) The entity is a post-employment benefit plan for the benefit of employees of either GVMH PLC and its subsidiaries or an entity related to GVMH PLC and its subsidiaries. (vi) The entity is controlled or jointly controlled by a person identified in (a). (vii) A person identified in (a)(i) has significant influence over the entity or is a member of the key management personnel of the entity (or of a parent of the entity). (viii) The entity, or any member of a GVMH PLC and its subsidiaries of which it is a part, provides key management personnel services to GVMH PLC and its subsidiaries or to GVMH PLC and its subsidiaries' parent Close members of the family of a person are those family members who may be expected to influence, or be influenced by, that person in their dealings with the entity. Operating leases All leases are treated as operating leases. Where the Group is a lessee, payments on operating lease agreements are recognised as an expense on a straight-line basis over the lease term. Associated costs, such as maintenance and insurance, are expensed as incurred. 2.21. Segmental analysis GVMH PLC has two segments of advertising and digital marketing and operates in People's Republic of China. 3. Summary of Critical Accounting Estimates and judgements The preparation of financial information in conformity with IFRS requires the use of certain critical accounting estimates. It also requires the Directors to exercise their judgement in the process of applying the accounting policies which are detailed above. These judgements are continually evaluated by the Directors and management and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The key estimates and underlying assumptions concerning the future and other key sources of estimation uncertainty at the statement of financial position date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial period are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods. The estimates and judgements which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities, as well as the recognition of revenue, within the next financial year are discussed below: * Recognising appropriate revenue in line with performance obligations
Management identifies the performance obligations associated with each contract
and then exercises judgement to establish an appropriate percentage of the
total transaction price to recognise once each identified performance
obligation is successfully completed.
* Useful lives of depreciable assets
Management reviews the useful lives and residual value of depreciable assets at
each reporting date to ensure that the useful lives represent a reasonable
estimate of likely period of benefit to the Group. Tangible fixed assets are
depreciated over their useful lives taking into account of residual values,
where appropriate. The actual lives of the assets and residual values are
assessed annually and may vary depending on a number of factors. In
re-assessing asset lives, factors such as technological innovation, product
life cycles and maintenance programmes are taken into account. Residual value
assessments consider issues such as future market conditions, the remaining
life of the asset and projected disposal values.
4. Revenue
Analysis of GVMH PLC and its subsidiaries' revenue is as follows:
Year ended Year ended Year ended Year ended
31 December 31 December 31 31 December
2018 2017 December 2017
2018
HK$'000 HK$'000 HK$'000 HK$'000
Revenue
Advertising fee income 8,985 5,106 - -
Digital marketing income 8,575 4,365
Other 466 43
18,026 9,514
Other income
Other income 79 62 - -
79 62 - -
18,105 9,576 - -
5. Finance costs
Year ended Year ended Year Year ended
ended
31 31 December 31 31 December
December 2017 December 2017
2018 2018
HK$'000 HK$'000 HK$'000 HK$'000
Finance costs
Interest on shareholder loans 316 296 - -
6. Administrative expenses
Year ended Year ended Year Year ended
ended
31 31 December 31 31 December
December 2017 December 2017
2018 2018
HK$'000 HK$'000 HK$'000 HK$'000
Audit fees 417 260 165 -
Business development and marketing 464 470 42 -
Depreciation 3,982 4,364 - -
Premium on reverse 5,259 - - -
RTO, Legal and professional fee 9,672 272 14,488 2,149
Office rental 2,124 2,233 47 107
Overseas travelling 786 516 219 -
Other 7,061 2,358 1,739 661
Administrative expenses 29,765 10,473 16,700 2,917
Directors fees and emoluments 1,435 618 816 -
Wages and Salaries 7,511 5,543 - -
38,711 16,634 17,516 2,917
Employee numbers No. No. No. No.
Management 5 5 3 2
Operations 30 27 - -
35 32 3 2
7. Income tax expense
No Hong Kong profits tax provision made in the accounts as GVMH PLC and its
subsidiaries' do not have any assessable profits for the period.
Reconciliation between tax expenses and accounting profit at applicable tax
rates of 16.5%:
Year ended Year ended Year Year ended
ended
31 31 December 31 31
December 2017 December December
2018 2018 2017
HK$'000 HK$'000 HK$'000 HK$'000
(Loss) / profit before tax (33,062) (11,814) (17516) (2,917)
Notional tax on (loss) / profit (5,455) (1,949) (36,328) (583)
before taxation, calculated at the
rates applicable to (loss) / profit
in the countries concerned
Tax effect of non-taxable income - - - -
Tax effect of not recognised tax 5,455 1,949 3,328 583
loss
Actual tax expenses - - - -
GVMH PLC and its subsidiaries' has not recognised deferred tax assets of
HK$2,559,994 in respect of accelerated depreciation over capital allowances. No
deferred tax asset has been recognised on the accumulated tax losses of
HK$15,515,116 as the availability of future taxable profits against which the
assets can be utilised is uncertain at 31 December 2018.
The tax losses can be carried forward to offset against the taxable profits of
subsequent years for up to five years from the year in which they were incurred
or there is no restriction on their expiry, depending on the tax jurisdiction
concerned.
8. Earnings/ (Loss) per share
The calculation of basic earnings per share is based on GVMH PLC and its
subsidiaries' loss attributable to shareholders of GVMH PLC and weighted
average number of shares in issue during the year, details are as follows:
From
Year ended Year ended Year ended Year ended
31 31 December 31 December 31 December
December 2017 2018 2017
2018
HK$'000 HK$'000 HK$'000 HK$'000
Profit/loss attributable to (33,069) (11,784) (11,586) (2,917)
GVMH PLC
Weighted average number of 96,287,079 12,486 96,287,079 6,103,507
shares
Basic and diluted loss per (0.34) (944) (0.12) (0.48)
share HK$
There were no potential dilutive ordinary shares in existence during the period
ended 31 December 2018 or the years ended 31 December 2017, and hence diluted
earnings per share is the same as the basic earnings per share.
9. Property, plant and equipment
Displays Computer Furniture, Leasehold Total
panels and equipment fixtures & improvement
CMS equipment
HK$'000 HK$'000 HK$'000 HK$'000 HK$'000
Cost
At 31 December 2017 16,405 246 296 82 17,029
Additions during the year - 43 5 - 48
2018
Disposals during the year (127) (1) - - (128)
2018
At 31 December 2018 16,278 288 301 82 16,949
Accumulated depreciation
At 31 December 2017 10,331 185 292 56 10,864
Charge for the year 2018 3,923 35 4 20 3,982
Written back on disposal (80) - - - (80)
At 31 December 2018 14,173 220 296 76 14,765
Net carrying amount
At 31 December 2018 2,105 68 5 6 2,183
At 31 December 2017 6,075 61 4 26 6,166
10. Inventories
As at As at As at As at
31 December 31 December 31 December 31 December
2018 2017 2018 2017
Inventories HK$'000 HK$'000 HK$'000 HK$'000
Goods 537 589 - -
Online resources 1,170 2,237
1,707 2,826 - -
As at 31 December 2018, provision for impairment on goods of HK$205,000 for the
group has been made.
11. Trade and other receivables
Note: Amounts due from related companies is unsecured, interest-free and
repayable on demand.
Receivable that were not impaired was as follows:
As at As at As at As at
31 December 31 31 31 December
2018 December December 2017
2017 2018
HK$'000 HK$'000 HK$'000 HK$'000
Prepayments 1,036 672 - -
Amount due from Subsidiaries 11,412 2,637
Neither past due or nor impaired 5,104 3,821 48 -
6,140 4,493 11,460 2,637
12. Cash and cash equivalents
As at As at As at As at
31 December 31 31 31 December
2018 December December 2017
2017 2018
Cash and cash equivalents HK$'000 HK$'000 HK$'000 HK$'000
Cash at bank and in hand 2,552 1,136 783 2,785
2,552 1,136 783 2,785
13. Trade and other payables
As at As at As at As at
31 December 2018 31 31 31 December
December December 2017
2017 2018
Trade and other payables HK$'000 HK$'000 HK$'000 HK$'000
Trade payable 10,577 7,601 816 130
Other payables 5,151 - - -
Total trade and other payables 15,728 7,601 816 130
14. Share based payments
The Group has a share ownership compensation scheme for Directors and Senior
employees of the Group. In accordance with the provisions of the plan,
Directors and Senior employees may be granted options to purchase ordinary
shares in the Company.
The company issued options on 12,000,000 ordinary shares on 19 June 2018. The
options vest annually over a 3 year period to 31 December 2020 and can be
exercised at 15p per share during this period .
The fair value of equity-based share options granted is estimated at the date
of grant using the Black-Scholes pricing model, taking into account the terms
and conditions upon which the options have been granted. The calculated fair
value of share options charged to the Group and Company financial statements in
the year is HK$ 1,446,658.
The following are the inputs to the model for the options granted during the
prior year:
Share
Options
2018
Exercise price 0.15p
Share price at date of grant 0.15p
Risk free rate 1.04%
Volatility 50%
Expected Life 3 Years
Fair Value 0.03626798
15. Convertible bonds
On 24 January 2017, the GVC holding's Limited issued convertible bonds with an
aggregate principal amount of US$1,500,000. As of 31 December 2017, the
aggregate amount received was US$1,500,000. The maturity date should be on 31
March 2018. The bonds were convertible at the option of the bondholders into
ordinary shares on the basis of 8.3%.
During the year on 9 May 2018, the convertible bonds were automatically
converted to the fully paid Conversion Shares (1,134 Ordinary Shares).
16. Shareholder loans
As at As at As at As at
31 December 31 31 31 December
2018 December December 2017
2017 2018
Shareholders' loan HK$'000 HK$'000 HK$'000 HK$'000
Shareholders' loan at fair value 8,750 6,250 - -
Capital contribution reserve (390) (686) - -
arising from effective interest
portion
Accrued effective interest paid 316 296 - -
to shareholders
Shareholder's loan at amortised 8,676 5,860 - -
cost
The shareholders' loan is unsecured, interest-free and repayable on demand.
As the shareholders' loan is unsecured, interest-free and repayable on demand,
the directors assumes that the shareholder's loan is expected to repay in year
2019 and the available market interest rate for shareholder's loan of the same
kind is at the best landing rate in Hong Kong plus 1% per annum which is also
used to calculate the effective interest portion of such.
17. Share Capital
(a) Issued share capital
Allotted, Number of Share Capital Share Share Share Premium
called up and shares Capital Premium
fully paid
ordinary
shares of 10p
each
GBP HK$ GBP HK$
Balance at 31 6,230,000 623,000 6,578,413 256,500 2,713,727
December 2017
After 90,057,079 9,005,708 89,438,773 4,166,454 41,391,838
Acquisition
Share 19 June
2018
Balance at 31 96,287,079 9,628,708 96,017,186 4,422,954 44,105,565
December 2018
(b) Capital management
GVMH PLC and its subsidiaries' objective when managing capital are to safeguard
GVMH PLC and its subsidiaries' ability to continue as a going concern, so that
it can continue to provide returns for shareholders and benefit for other
stakeholders, and to provide an adequate return to shareholders.
GVMH PLC and its subsidiaries' manages the capital structure and makes
adjustments to it in the light of changes in economic conditions and the risk
characteristics of the underlying assets. In order to maintain or adjust the
capital structure, GVMH PLC and its subsidiaries' may adjust the amount of
dividends paid to shareholders, return capital to shareholders, issue new
shares, or sell assets to reduce debt. No changes were made in the objectives,
policies and processes during the year/period of 2017 and 2018.
GVMH PLC and its subsidiaries' monitors' capital using a gearing ratio, which
are calculated by dividing consolidated debts by consolidated total
shareholder's equity. The Group's policy is to keep the gearing ratio at a
reasonable level. The Group's gearing ratio was 122%, and 120% as 31 December
2018 and 2017 respectively.
18. Financial instruments
GVMH PLC and its subsidiaries has classified its financial assets in the
following categories:
As at As at As at As at
31 December 31 December 31 December 31 December
2018 2017 2018 2017
Loans and receivables HK$'000 HK$'000 HK$'000 HK$'000
Accounts and other receivables 5,104 3,821 48 -
Amounts due from related - - 11,412 2,637
companies
Deposits and prepayments 1,036 672 - -
Cash and cash equivalents 2,552 1,136 783 2,785
Loans and receivables 8,692 5,629 12,243 5,422
As at As at As at As at
31 December 31 December 31 December 31 December
2018 2017 2018 2017
Financial liabilities at HK$'000 HK$'000 HK$'000 HK$'000
amortised cost
Trade and other payables 15,728 7,601 816 130
Deposits received 111 4,048 - -
Shareholders' loan 8,676 5,860 - -
Convertible bonds - 11,670 - -
Amount due to a director 304 55 - -
Financial liabilities at 24,819 29,234 816 130
amortised cost
GVMH PLC and its subsidiaries are exposed to credit risk, liquidity risk and
market risk arising in the normal course of its business and financial
instruments. GVMH PLC and its subsidiaries' and GVMH PLC's risk management
objectives, policies and processes mainly focus on minimising the potential
adverse effects of these risks on its financial performance and position by
closely monitoring the individual exposure.
(a) Credit risk
GVMH PLC and its subsidiaries are exposed to credit risk on financial assets,
mainly attributable to trade and other receivables. It sets credit limits on
each individual customer and prior approval is required for any transaction
exceeding that limit. The customer with sound payment history would accumulate
a higher credit limit. In addition, the overseas customers would normally be
required to transact with GVMH PLC and its subsidiaries' and GVMH PLC by letter
of credit in order to minimise GVMH PLC and its subsidiaries' credit risk
exposure.
At 31 December 2018, GVMH PLC and its subsidiaries has no concentration of risk
and the maximum exposure to credit risk is represented by the carrying amount
of each financial asset.
(b) Liquidity risk
GVMH PLC and its subsidiaries is exposed to liquidity risk on financial
liabilities. It manages its funds conservatively by maintaining a comfortable
level of cash and cash equivalents in order to meet continuous operational
need. Various banking facilities and credit lines have also been arranged with
different banks in order to fund any emergency liquidity requirements.
Liquidity risk Not later than Later than one Carrying
one month month and not amount
later than 5
years
As at 31 December 2018
Trade and other 15,728 - 10,577
payables
Deposits received 111 - 111
Shareholders' loan - 8,676 8,676
Amount due to Director 304 - 304
16,143 8,676 24,819
As at 31 December 2017
Trade and other 7,601 - 7,601
payables
Deposits received 4,048 - 4,048
Shareholders' loan - 5,860 5,860
Amount due to Director 55 - 55
Convertible bonds 11,670 11,670
23,374 5,860 29,234
GVMH PLC
As at 31 December 2018
Trade and other (816) - (816)
payables
(816) - (816)
As at 31 December 2017
Trade and other (130) - (130)
payables
(130) - (130)
(c) Interest rate risk
The Group has no exposure on fair value interest rate risk. It also has
exposure on cash flow interest rate risk which is mainly arising from its
deposits with banks.
GVMH PLC and its subsidiaries mainly holds fixed deposits with banks with
maturity within 3 months and the exposure is considered not significant. In
consequence, no material exposure on fair value interest rate risk is expected.
Even that, GVMH PLC closely monitors the fair value fluctuation of the
investments and disposes of them in case of significant increase in interest
rate is foreseen.
Sensitivity analysis
At 31 December 2018, if interest rates as that date had been 100 basis points
lower/higher with all other variables held constant, GVMH PLC loss for the year
would have been HK$25,090 (2017: HK$1,288) higher/lower.
(d) Currency risk
GVMH PLC and its subsidiaries purchases and sells in various foreign
currencies, mainly US dollars and RMB that expose it to currency risk arising
from such purchases and sales and the resulting receivables and the payables.
GVMH PLC and its subsidiaries closely and continuously monitors the exposure on
currency risk. Since HK dollars are pegged to US dollars, there is no
significant exposure expected on US dollars transactions and balances.
In respect of purchases and payables, GVMH PLC and its subsidiaries controls
its volume of purchase orders to a tolerable level and avoids concentrating the
purchases in a single foreign currency by diversifying such foreign currency
risk exposure.
In respect of sales and receivables, GVMH PLC and its subsidiaries sets a
prudent credit limit to individual customers who transact with it in other
foreign currencies. The directors' approval is required on the exposure to an
individual customer or transaction that exceeds the limit.
19. Capital commitments
Capital commitments outstanding at the end of the reporting period not provided
for in the financial statements were as follows:
As at As at As at As at
31 31 December 31 December 31 December
December 2017 2018 2017
2018
Capital commitments HK$'000 HK$'000 HK$'000 HK$'000
Contracted for - - - -
Authorised but not contracted - - - -
for
Capital commitments - - - -
20. Operating lease commitments
At the end of the reporting period, the total future minimum lease payments
under non-cancellable operating leases are payable as follows:
As at As at As at As at
31 31 December 31 December 31 December
December 2017 2018 2017
2018
Operating lease commitments HK$'000 HK$'000 HK$'000 HK$'000
Within 1 year 1,568 1,123 - -
After 1 year but within 5 41 644 - -
years
Operating lease commitments 1,609 1,767 - -
21. Contingent liabilities
At 31 December 2018, GVMH PLC and its subsidiaries did not have any significant
contingent liabilities.
22. Material related party transactions
Save as those transactions and balances disclosed elsewhere in these financial
statements with sharholders abd director and Cyber Lion Limited a company
controlled by Edward Ng and Ajay Rajpal, GVMH PLC and its subsidiaries had no
material transactions with related parties.
23. Non-adjusting events after the reporting period
At 31 December 2018, GVMH PLC and its subsidiaries did not have material
non-adjusting events after the report period that have significant impact on
the financial position and operation of the Group.
24. List of subsidiaries
Proportion of ownership interest
Name of GVMH Place of Particulars GVMH PLC and Held by Held by the Principal
PLC incorporation of issued subsidiaries GVMH PLC subsidiary activities
/ operation and paid up effective
capital interest
GVC Holdings BVI/Hong Kong US$13,620 100% 100% 100% Investment
Ltd holdings
Billion Wise BVI / Hong US$10,862 100.0% - 100% Investment
Investment Ltd Kong holdings
Founding Hong Kong HK$10,000 70.0% - 70% Social Media
Technology Marketing
(Int'l) Ltd
Grand Vision BVI / Hong US$10,843 79.9% - 79.9% Investment
Communication Kong holdings
Ltd
Grand Vision Hong Kong HK$1,000,000 79.9% 79.9% Advertising
Media Limited -
Grand Vision Hong Kong HK$7,824,268 100.0% 100.0% 3D panel
Media Network - advertising
Limited
Grand Vision PRC/Hong Kong RMB832,987 79.9% 79.9% Advertising
Media -
(Technology)
(Shenzhen) Ltd
Ying Hong Kong HK$4,900,000 55.0% 55% Social Media
Interactive - Marketing
Marketing
Services Ltd
*?????? PRC RBM5,874,000 100.0% 100.0% 3D panel
?????? - advertising
As at 31 December 2018 the following list contains only the particulars of
subsidiaries which principally affected the results, assets or liabilities of
GVMH PLC and its subsidiaries.
*not audited by IBC CPA Ltd
25. Control
At 31 December 2018, there is no one controlling party.
END
(END) Dow Jones Newswires
May 03, 2019 08:28 ET (12:28 GMT)
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