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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Vinaland Limited | LSE:VNL | London | Ordinary Share | KYG936361016 | ORD USD0.01 |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 0.0055 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From May 2019 to May 2024
TIDMVNL
RNS Number : 1808U
VinaLand Limited
27 March 2019
27 March 2019
VinaLand Limited
Interim results for the six months ended 31 December 2018
VinaLand Limited ("the Company" or "VNL"), the AIM-quoted investment vehicle established to target strategic segments within Vietnam's emerging real estate market, today announces its interim results for the six months ended 31 December 2018 ("the Period").
Financial highlights:
Hot Features
Premium
-- Net Asset Value ("NAV") of USD0.5 million (30 June 2018: USD46.9 million); and,
-- NAV per share of USD0.0036 (30 June 2018: USD0.286).
Operational highlights:
During the Period, VNL completed its last four divestments as below:
-- 196 HVT project in July 2018, resulting in net proceeds of USD2.8 million. -- SGPY project in July 2018, resulting in net proceeds of USD0.3 million. -- Green Park Estate project in November 2018, resulting in net proceeds of USD35.3 million. -- Garland project in November 2018, with final return from development of USD0.9 million.
About VinaCapital
Founded in 2003, VinaCapital is a leading investment and asset management firm headquartered in Vietnam, with a diversified portfolio of USD1.8 billion in assets under management. The firm has two closed-ended funds that trade on the London Stock Exchange: the VinaCapital Vietnam Opportunity Fund Limited, which trades on the Main Market, and VinaLand Limited which trades on AIM. VinaCapital also manages the Forum One - VCG Partners Vietnam Fund, one of Vietnam's largest open-ended UCITS-compliant funds, the Vietnam Equity Special Access Fund, numerous segregated accounts, and two domestic funds. VinaCapital also has joint ventures with Draper Fisher Jurvetson in venture capital, and Warburg Pincus in hospitality and lodging. VinaCapital's expertise spans a full range of asset classes including capital markets, private equity, real estate, venture capital, and fixed income.
For more information about VinaCapital, please visit www.vinacapital.com
The financial statements will be posted to shareholders and are available on the Company's website at
https://vnl.vinacapital.com/ .
Enquiries:
Michael Truong / Joel Weiden
VinaCapital Investment Management Limited
Investor Relations / Communications
+84 28 3821 9930
michael.truong@vinacapital.com / joel.weiden@vinacapital.com
Philip Secrett
Grant Thornton UK LLP, Nominated Adviser
+44 (0)20 7383 5100
philip.j.secrett@uk.gt.com
David Benda / Hugh Jonathan
Numis Securities Limited, Broker
+44 (0)20 7260 1000
funds@numis.com
Chairman's Statement
Dear Shareholders,
I am pleased to report that VinaLand Limited (the "Company", "VNL") has completely divested all of its assets and distributed most of the divestment proceeds to shareholders during the interim period from 1 July 2018 to 31 December 2018.
Project divestments
During the period the Company completed the last four disposals as follows:
-- 196 HVT project (July 2018): the Company disposed of its entire stake in the 196 HVT project at a total valuation of 22.1%, above the 31 March 2018 unaudited net asset value and 28.0% below the net asset value at the time of the 2016 EGM, including adjustments for additional investments over this period. This transaction resulted in net cash proceeds of USD2.8 million to VNL.
-- SGPY project (July 2018): the Company divested its entire stake in this project which resulted in net cash proceeds of USD0.3 million to VNL, equal to both the 31 March 2018 unaudited net asset value and the net asset value at the time of the 2016 EGM (including adjustments for additional investments over this period).
-- Green Park Estate project (November 2018): the Company disposed of its entire stake in this project for net cash proceeds of approximately USD35.3 million, which includes the repayment of shareholder loans, resulting in an IRR of 0.9% to the Company. The total valuation is recorded at 22.5% above the 30 September 2018 unaudited net asset value and 14.8% above the unaudited net asset value at the time of VNL's extraordinary meeting in November 2016. Both figures include adjustments for additional investments up to the date of exit.
-- Garland project (November 2018): the Company received the final return from the development of Garland project (located in Ho Chi Minh City) with net proceeds of USD0.9 million to VNL, which is equal to the 30 September 2018 unaudited net asset value and 37.8% below the net asset value at the time of the 2016 EGM including adjustments for additional investments over this period.
Following the completion of the disposal of 196 HVT and SGPY projects in July 2018 and in accordance with paragraph 5.6 of the AIM Note for Investing Companies (which forms part of the AIM Rules), the Company announced that it had disposed of substantially all of its assets and entered a period of 12 months to begin an orderly wind up of the fund and cancellation of the Company's shares from trading on AIM. If the wind up is not fulfilled in the 12 month period the Company's shares will be suspended from trading on AIM in July 2019.
AGM
The Company held its Annual General Meeting ("AGM") on 14 December 2018, which included a resolution for the cancellation of the quotation of VNL shares from trading on AIM (the "Delisting Resolution"). However, the Delisting Resolution was not passed. Consequently, trading in VNL shares on AIM was not cancelled and the Company will continue to remain listed on AIM.
Shareholder distributions and share repurchases
Following the disposal of all projects in the portfolio, the Company distributed most of its distributable funds to shareholders in December 2018 via a return of capital of approximately USD45.45 million, representing USD0.31 per ordinary share. In addition to the return of capital, the Company also repurchased (via ongoing share buybacks) a further 16.8 million ordinary shares, which have been cancelled.
During this 6-month period, USD50.2 million in total was distributed using these two methods.
Since the commencement of the share buyback programme, the Company has cancelled 353.3 million shares, representing 70.7% of the Company's total issued shares.
Fund performance
The NAV per share (reviewed by the auditors) was USD0.0036 at 31 December 2018, after taking into account the provision made for the Company's final commitments, including the operating and liquidation costs until the winding up of the Company.
On behalf of the Board, I appreciate your continued support.
Michel Casselman
Chairman
VinaLand Limited
27 March 2019
CONDENSED INTERIM CONSOLIDATED BALANCE SHEET
31 December 30 June
2018 2018
Note USD'000 USD'000
ASSETS
Current
Trade and other receivables 7 317 3,468
Receivables from and advances to
related parties - 100
Short-term investments 34 34
Cash and cash equivalents 8 5,752 29,079
-------------- --------------
Total current assets 6,103 32,681
Assets classified as held for sale 9 - 30,308
-------------- --------------
Total assets 6,103 62,989
31 December 30 June
2018 2018
Note USD'000 USD'000
EQUITY AND LIABILITIES
EQUITY
Equity attributable to equity shareholders
of the parent
Share capital 10 1,466 1,634
Additional paid-in capital 11 68,258 118,422
Equity reserve 76,454 76,283
Translation reserve (37) (4,327)
Accumulated losses (145,616) (145,324)
-------------- --------------
525 46,688
Non-controlling interests - 243
-------------- --------------
525 46,931
Total equity -------------- --------------
LIABILITIES
Current
Trade and other payables 12 1,849 3,166
Payables to related parties 19 3,729 12,591
-------------- --------------
Total current liabilities 5,578 15,757
Liabilities classified as held for
sale 9 - 301
-------------- --------------
Total liabilities 5,578 16,058
-------------- --------------
Total equity and liabilities 6,103 62,989
Net assets per share attributable to
equity
shareholders of the parent (USD per
share) 17(c) 0.004 0.286
CONDENSED INTERIM CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Equity attributable to equity shareholders of the Company
Total equity
attributable
Additional to owners Non-
Share paid-in Equity Translation Accumulated of the controlling Total
capital capital reserve reserve losses Company interests equity
USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000
Balance at 1 July
2018 1,634 118,422 76,283 (4,327) (145,324) 46,688 243 46,931
Loss for the period - - - - (292) (292) - (292)
Currency
translation - - - (282) - (282) - (282)
Reclassification
of currency
translation
reserve on
disposal of
subsidiaries - - - 4,572 - 4,572 - 4,572
---------- ---------- ---------- ---------- ------------ ---------- -------------- ------------
Total comprehensive - - - 4,290 (292) 3,998 - 3,998
income ---------- ---------- ---------- ---------- ------------ ---------- ------------ ------------
Transactions with
owners in their
capacity as owners:
Repurchases and
cancellation of
shares (168) (4,712) 171 - - (4,709) - (4,709)
Distributions to
shareholders (Note
11) - (45,452) - - - (45,452) - (45,452)
Distributions to
non-controlling
interests - - - - - - (243) (243)
---------- -------------- ------------ ------------ ------------ ------------ ------------ ------------
Balance at 31
December 2018 1,466 68,258 76,454 (37) (145,616) 525 - 525
Equity attributable to equity shareholders of the Company
Total equity
attributable
Additional to owners Non-
Share paid-in Equity Other Translation Accumulated of the controlling Total
capital capital reserve reserve reserve losses Company interests equity
USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000
Balance at 1 July
2017 2,580 332,803 65,166 (10) (45,443) (113,612) 241,484 74,867 316,351
Loss for the period - - - - - (19,398) (19,398) 730 (18,668)
Currency translation - - - - 338 - 338 89 427
Reclassification of
currency
translation
reserve on
disposal
of subsidiaries - - - - 20,107 - 20,107 3,183 23,290
---------- ---------- ---------- ---------- ---------- ------------ ---------- ------------ ----------
Total comprehensive - - - - 20,445 (19,398) 1,047 4,002 5,049
income ---------- ---------- ---------- ---------- ---------- ------------ ---------- ---------- ----------
Transactions with
owners
in their
capacity as owners:
Repurchases and
cancellation
of shares (772) (72,523) 10,527 - - - (62,768) - (62,768)
Distributions to
shareholders - (60,433) - - - - (60,433) - (60,433)
Disposals of
subsidiaries - - - 10 - - 10 (52,578) (52,568)
Capital
contributions to
subsidiaries - - - - - - - 2,759 2,759
Distributions to
non-controlling
interests - - - - - - - (19,133) (19,133)
---------- -------------- ------------ ------------ ------------ ------------ ------------ ------------ ------------
Balance at 31
December 2017 1,808 199,847 75,693 - (24,998) (133,010) 119,340 9,917 129,257
CONDENSED INTERIM CONSOLIDATED INCOME STATEMENT
Six months ended
----------------------------
31 December 31 December
2018 2017
Note USD'000 USD'000
Revenue - 30
Cost of sales - (102)
------------ ------------
Gross loss - (72)
Net gain on fair value adjustments
of investment properties - 3,547
Net gain on fair value adjustment
of investment properties classified
as held for sale - 2,623
Selling and administration expenses 13 (2,890) (2,435)
Net gains/(losses) on disposals of
investments 14 4,157 (20,097)
Finance income 131 545
Finance expenses (113) (580)
Share of losses of associates, net (558) (295)
Other income 960 195
Other expenses (14) (488)
------------ ------------
Income/(loss) from operations before
income tax 1,673 (17,057)
Income tax 15 (1,965) (1,611)
------------ ------------
Loss from operations (292) (18,668)
Attributable to equity shareholders
of the Company (292) (19,398)
Attributable to non-controlling interests - 730
------------ ------------
Net loss for the period (292) (18,668)
Loss per share
* basic and diluted (USD per share) 17(a) (0.00) (0.08)
------------ ------------
CONDENSED INTERIM CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Six months ended
----------------------------
31 December 31 December
2018 2017
USD'000 USD'000
Net loss for the period (292) (18,668)
Other comprehensive income
Items that may be reclassified subsequently
to profit or loss:
Reclassification of currency translation
reserve on
disposal of investments 4,572 23,290
Exchange differences on translating foreign
operations (282) 427
------------ ------------
Other comprehensive income for the period 4,290 23,717
------------ ------------
Total comprehensive income for the period 3,998 5,049
Attributable to equity shareholders of
the Company 3,998 1,047
Attributable to non-controlling interests - 4,002
------------ ------------
3,998 5,049
CONDENSED INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS
Six months ended
--------------------------------
31 December 31 December
2018 2017
Note USD'000 USD'000
Operating activities
Net operating profit/(loss) before tax 1,673 (17,057)
Adjustments for:
Depreciation and amortisation - 8
Net gain on fair value adjustments of
investment properties - (3,547)
Net gain on fair value adjustments of
investment properties
classified as held for sales - (2,623)
Losses on sales of subsidiaries 14 670 20,168
Gains on sales of assets classified
as held for sales 14 (4,827) (71)
Share of losses of associates, net 558 295
Unrealised foreign exchange losses 30 7
Interest expense 76 570
Interest income (123) (374)
------------ ------------
Net loss before changes in working capital (1,943) (2,624)
Change in trade receivables and other
current assets 3,400 (5,368)
Change in trade payables and other current
liabilities (9,140) 61,540
------------ ------------
Net cash (outflow)/inflow from operating (7,683) 53,548
activities ------------ ------------
Investing activities
Interest received 123 365
Purchases of investment properties and
prepayments for acquisitions of investments - (8,646)
(Net payments)/proceeds from sales of
subsidiaries (135) 51,543
Proceeds from disposals of assets classified
as held for sale 34,848 2,987
Investments in associates - (11,186)
------------ ------------
34,836 35,063
Net cash inflow from investing activities ------------ ------------
Six months ended
------------------------------
31 December 31 December
2018 2017
Note USD'000 USD'000
Financing activities
Additional capital contributions from
non-controlling interests - 2,759
Ordinary shares acquired by the Company 10 (4,709) (62,768)
Distributions to shareholders 11 (45,452) (60,433)
Distributions to non-controlling interests (243) (19,133)
Interest paid (76) (571)
------------ ------------
(50,480) (140,146)
Net cash outflow to financing activities ------------ ------------
Net changes in cash and cash equivalents
for the period (23,327) (51,535)
Cash and cash equivalents at the beginning
of the period 29,079 88,919
Cash and cash equivalents classified
as held for sale - 952
Exchange differences on cash and cash
equivalents - 5
Cash and cash equivalents at the end ------------ ------------
of the period 8 5,752 38,341
During the period, major non-cash transactions included capital gains tax of USD2.0 million (six months ended 31 December 2017: USD10.1 million) realised on the disposals of investments. The tax amounts due were withheld from disposal proceeds by the acquirers of investments and remitted to the tax authorities. As a result, these amounts are excluded from proceeds from disposal of subsidiaries included in the condensed interim consolidated statement of cash flows.
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
1 GENERAL INFORMATION
VinaLand Limited ("the Company") is a limited liability company incorporated in the Cayman Islands. The registered office of the Company is PO Box 309GT, Ugland House, South Church Street, George Town, Grand Cayman, Cayman Islands. The original objective of the Company was to focus on key growth segments within Vietnam's emerging real estate market, namely residential, office, retail, industrial and leisure projects in Vietnam and the surrounding countries in Asia. The Company is listed on the AIM Market of the London Stock Exchange under the ticker symbol VNL.
At the Extraordinary General Meeting ("EGM") held on 21 November 2012 the shareholders approved a proposal that the Company make no new investments and dispose of a portion of its investments in a controlled and orderly manner so as to maximise returns to shareholders. At the subsequent EGM held on 18 November 2016 this strategy was expanded to include the disposal of all remaining investments. The key changes impacting these financial statements are summarised as follows:
-- The new strategy involves the orderly sell down of investments in conjunction with ongoing development of selected projects to maximise returns to shareholders. All projects will be realised over a period of approximately three years and the proceeds collected, less operating costs, disposal and alignment fees, will be returned to shareholders.
-- The Third Amended and Restated Investment Management Agreement ("the Third Amended Management Agreement") introduces a new fee structure composed of disposal and alignment fees, prepayment advances and a retention account to ensure that the Investment Manager is incentivised to meet the investing policy (Note 19).
On 23 July 2018, the Company announced that it had disposed of substantially all of its assets. In accordance with paragraph 5.6 of the AIM Note for Investing Companies, which forms part of the AIM Rules, the Company has 12 months to begin an orderly wind up of the Company and cancellation of its shares from trading on AIM, ultimately resulting in a voluntary liquidation. If this is not fulfilled, the Company's shares will be suspended from trading on AIM in July 2019.
The condensed interim consolidated financial statements for the six months ended 31 December 2018 were approved for issue by the Company's Board of Directors on 26 March 2019.
These condensed interim consolidated financial statements have been reviewed, not audited.
2 BASIS OF PREPARATION
The Company and its subsidiaries herein are referred to as the Group.
These condensed interim consolidated financial statements are for the six months ended 31 December 2018. They have been prepared in accordance with International Accounting Standard 34, "Interim Financial Reporting" as issued by the International Accounting Standards Board ("IASB"). They do not include all of the information required in the annual consolidated financial statements which are prepared in accordance with International Financial Reporting Standards ("IFRSs"). Accordingly, these financial statements are to be read in conjunction with the annual consolidated financial statements of the Group for the year ended 30 June 2018, which have been prepared in accordance with IFRSs.
Going concern
On 23 July 2018, the Company announced that it had disposed of substantially all of its assets. In accordance with paragraph 5.6 of the AIM Note for Investing Companies, which forms part of the AIM Rules, the Company has 12 months to begin an orderly wind up of the Company and cancellation of its shares from trading on AIM, ultimately resulting in a voluntary liquidation. If this is not fulfilled, the Company's shares will be suspended from trading on AIM in July 2019. As a consequence, these condensed interim consolidated financial statements have been prepared using the liquidation basis, as the going concern basis is no longer considered appropriate.
3 ACCOUNTING POLICIES
These condensed interim consolidated financial statements (the "interim financial statements") have been prepared in accordance with the accounting policies, methods of computation and presentation adopted in the last annual consolidated financial statements for the year ended 30 June 2018.
4 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS
When preparing the condensed interim consolidated financial statements, management undertakes a number of judgements, estimates and assumptions about recognition and measurement of assets, liabilities, income and expenses. The actual results may differ from the judgements, estimates and assumptions made by management, and may not equal the estimated results.
There are no significant accounting estimates in the condensed interim consolidated financial statements for the six months ended 31 December 2018.
5 SEGMENT ANALYSIS
In identifying its operating segments, management generally follows the Group's sectors of investment which are based on internal management reporting information for the Investment Manager's management, monitoring of investments and decision making. The operating segments by investment portfolio include commercial, residential and office buildings, hospitality, mixed-use segments and cash and short-term investments.
Detail of activities undertaken by each segment and how each segment is managed and monitored, can be found in Note 4 to the annual consolidated financial statements of the Group for the year ended 30 June 2018.
There is no measure of segment liabilities regularly reported to the Investment Manager; therefore, liabilities are not disclosed in the sector analysis. Segment information can be analysed as follows for the reporting periods under review:
(a) Condensed Interim Consolidated Income Statement
Six months ended 31 December 2018
Commercial Residential and office buildings Mixed use Total
USD'000 USD'000 USD'000 USD'000
Revenue - - - -
Cost of sales - - - -
---------- ---------- ---------- ----------
Gross profit - - - -
Net gain/(loss) on disposals of
investments 4,827 - (670) 4,157
Finance income - 71 60 131
Share of losses of associates, net - - (558) (558)
Other income - 882 78 960
---------- ---------- ---------- ----------
Total profit/(loss) before
unallocatable expenses 4,827 953 (1,090) 4,690
Selling and administration expenses (2,890)
Finance expenses (113)
Other expenses (14)
----------
Profit before tax 1,673
Income tax (1,965)
----------
Net loss for the period (292)
Six months ended 31 December 2017
---------------------------------------------------------------------------------------
Commercial Residential and office Hospitality Mixed use Total
buildings
USD'000 USD'000 USD'000 USD'000 USD'000
Revenue - 15 - 15 30
Cost of sales - (94) - (8) (102)
------------ ------------ ---------- ---------- ------------
Gross (loss)/profit - (79) - 7 (72)
Net loss on disposals of
investments - (10,826) - (9,271) (20,097)
Finance income 16 229 - 300 545
Net gain/(loss) on fair
value adjustments of
investment properties - 3,923 - (376) 3,547
Net (loss)/gain on fair
value adjustment of
investment properties
classified as held for
sale (27) 2,650 - - 2,623
Share of losses of
associates, net (295) - - - (295)
Other income - 124 69 2 195
------------ ------------ ---------- ---------- ------------
Total (loss)/profit before
unallocatable expenses (306) (3,979) 69 (9,338) (13,554)
Selling and administration
expenses (2,435)
Finance expenses (580)
Other expenses (488)
----------
Loss before tax (17,057)
Income tax (1,611)
----------
Net loss for the period (18,668)
(b) Condensed Interim Consolidated Balance Sheet
As at 31 December 2018
--------------------------------------------------------------------------------
Commercial Residential Mixed Cash and Total
and office use deposits
buildings
USD'000 USD'000 USD'000 USD'000 USD'000
Trade, tax and other receivables - 317 - - 317
Short-term investments - - - 34 34
Cash and cash equivalents - - - 5,752 5,752
------------ -------------- -------------- ------------ --------------
Total assets - 317 - 5,786 6,103
Total assets include:
* Addition to non-current assets (other than financial
instruments and deferred tax assets) - - - - -
As at 30 June 2018
---------------------------------------------------------------
Commercial Residential Mixed Cash and Total
and office use deposits
buildings
USD'000 USD'000 USD'000 USD'000 USD'000
Trade, tax and other receivables - 424 3,144 - 3,568
Short-term investments - - - 34 34
Cash and cash equivalents - - - 29,079 29,079
Assets classified as held for sale 29,555 - 753 - 30,308
---------- -------- -------- ---------- ----------
Total assets 29,555 424 3,897 29,113 62,989
Total assets include:
* Addition to non-current assets (other than financial
instruments and deferred tax assets) 10,722 13,019 78 - 23,819
6 SUBSIDIARIES
The Group had the following principal subsidiaries which are held through special purpose vehicles established outside of Vietnam at 31 December 2018 and 30 June 2018:
31 December 2018 30 June 2018
------------------------------ ------------------------------
Percentage Percentage
Country Percentage interest held Percentage interest held
of incorporation interest by interest by
and place held by non-controlling held by non-controlling Nature of
Name of business the Group interests the Group interests business
Dien Phuoc Long
Real Estate Property
Company Limited Vietnam 100.0% - 100.0% - investment
VinaCapital
Commercial
Center
Limited Property
(Vietnam) Vietnam - - 38.2% 61.8% investment
SIH Real Estate
Limited
Company Property
(Vietnam) Vietnam - - 75.0% 25.0% investment
All subsidiaries are included in the consolidated financial statements. The proportion of the voting rights in the subsidiary undertakings held directly by the Group does not differ from the proportion of ordinary shares held. The Group further does not have any shareholding in the preference shares of subsidiary undertakings included in the Group.
During the period, the Group sold several subsidiaries, details of which are provided on the following pages. The assets and liabilities held by the subsidiaries sold were as follows:
As at the date
of disposal
USD'000
Current assets
Assets classified as held for sale 753
------------
Total current assets 753
Current liabilities
Trade payables (529)
Liabilities classified as held for sale (301)
------------
Total current liabilities (830)
------------
Net liabilities at the date when subsidiaries
were sold (77)
------------
Net liabilities attributable to the Company (77)
Net liabilities attributable to non-controlling
interests -
------------
Total consideration 607
------------
Consideration received from sales of subsidiaries 607
Less: Cash and cash equivalents of disposed subsidiaries (742)
------------
Cash paid due to loss of control of subsidiaries (135)
Details of the losses from sales of subsidiaries are as follows:
Period ended
31 December 2018
USD'000
Total consideration 607
Carrying amount of net liabilities sold attributable
to the Company (77)
------------
Gain on sales of subsidiaries before reclassification
of currency translation reserve 684
Reclassification of currency translation
reserve (1,354)
------------
Loss on sales of subsidiaries (670)
------------
Sale of VinaCapital Commercial Center Limited
During the period the Group sold its 38.2% equity interest in VinaCapital Commercial Center Limited for a total consideration of USD0.6 million. The book value of the net assets at the sale date was USD0.2 million and the reclassification of translation reserve on disposal was USD0.8 million, resulting in a loss of USD0.4 million.
Sale of SIH Real Estate Limited Company
During the period the Group sold its 75% equity interest in SIH Real Estate Limited Company for a total consideration of USD1.0. The book value of the net liabilities at the sale date was USD0.2 million and the reclassification of translation reserve on disposal was USD0.5 million, resulting in a loss of USD0.3 million.
7 TRADE AND OTHER RECEIVABLES
31 December 30 June
2018 2018
USD'000 USD'000
Receivables from disposals of subsidiaries
(*) 150 3,143
Short-term loan receivable from third
parties - 263
Other receivables 167 62
------ ------------
317 3,468
(*) Receivables from disposals of subsidiaries represent the final settlements upon completion of the transfer of ownership of subsidiaries to the buyers in accordance with the relevant sale and purchase agreements.
All current trade and other receivables are short-term in nature and their carrying values, after allowances for impairment, approximate their fair values at the date of the condensed interim consolidated balance sheet.
8 CASH AND CASH EQUIVALENTS
31 December 30 June
2018 2018
USD'000 USD'000
Cash at banks 2,952 29,035
Cash equivalents 2,800 44
------------ ------------
5,752 29,079
Cash equivalents include short-term highly liquid investments with original maturities of three months or less.
As at 31 December 2018, cash and cash equivalents held at the Company level amounted to USD4.8 million (as at 30 June 2018: USD27.8 million). The remaining balance of cash and cash equivalents is held by subsidiaries in Vietnam. Cash held in Vietnam is subject to restrictions imposed by co-investors and the Vietnamese government and it cannot be transferred out of Vietnam unless those restrictions are satisfied.
In accordance with the Third Amended Management Agreement, 20% of any disposal fee payable to the Investment Manager is to be deposited into a separate bank account under the Company's name ("the Retention Account"). These funds will be distributed upon the performance of certain milestones by the Manager. The Company has no specific rights to these funds. Included in cash and cash equivalents as at 31 December 2018 was USD3.6 million transferred into the Retention Account (as at 30 June 2018: USD1.2 million).
9 ASSETS AND LIABILITIES CLASSIFIED AS HELD FOR SALE
As at 31 December 2018, the Group had no assets and liabilities classified as held for sales.
For the comparative balance sheet date:
30 June 2018
--------------------------------------------------------------------------------
Attributable to
Assets Liabilities Net assets Non-controlling Equity shareholders
classified classified classified interests of the parent
as held as held as held
for sale for sale for sale
USD'000 USD'000 USD'000 USD'000 USD'000
Thang Loi Textile
Garment Joint Stock
Company 29,555 - 29,555 - 29,555
VinaCapital Commercial
Center Limited (Vietnam) 726 (274) 452 243 209
SIH Real Estate
Limited Company
(Vietnam) 27 (27) - - -
---------- ------ ---------- ------ ----------
30,308 (301) 30,007 243 29,764
It is the Group's view that all of its assets and liabilities classified as held for sales are in Level 3 of the fair value hierarchy. The major classes of assets and liabilities and their movements during the period/year are as follows:
Change
1 July in carrying 31 December
2018 amount Disposals 2018
USD'000 USD'000 USD'000 USD'000
Assets classified as held
for sale
Trade and other receivables 11 - (11) -
Cash and cash equivalents 742 - (742) -
Investments in associates 29,555 (558) (28,997) -
---------- ---------- ------------ ----------
30,308 (558) (29,750) -
---------- ---------- ------------ ----------
Liabilities classified
as held for sale
Trade and other payables 301 - (301) -
---------- ---------- ------------ ----------
301 - (301) -
---------- ------------ ------------ ----------
Net assets classified as
held for sale 30,007 (558) (29,449) -
For the comparative year:
Change
in carrying
1 July amount Transferred Disposals 30 June
2017 in 2018
USD'000 USD'000 USD'000 USD'000 USD'000
Assets classified
as held for sale
Investment properties 287,058 8,474 - (295,532) -
Property, plant and
equipment (net of
accumulated depreciation) 11 (1) - (10) -
Prepayment for acquisitions 3,077 (10) - (3,067) -
Other non-current
assets 14 - - (14) -
Other current assets 4 10 - (14) -
Inventories 29,584 8 - (29,592) -
Trade and other receivables 1,645 (131) 11 (1,514) 11
Cash and cash equivalents 4,283 (715) 742 (3,568) 742
Investments in associates 4,287 35 29,555 (4,322) 29,555
------------ -------- ---------- ------------ ----------
329,963 7,670 30,308 (337,633) 30,308
------------ -------- -------- ------------ ----------
Liabilities classified
as held for sale
Long-term borrowings
and debts 78,247 2,742 - (80,989) -
Short-term borrowings
and debts 18,828 1,114 - (19,942) -
Accruals and other
current liabilities 35 247 - (282) -
Trade and other payables 27,405 4,994 301 (32,399) 301
------------ ------------ ---------- ------------ ----------
124,515 9,097 301 (133,612) 301
------------ ------------ ---------- ------------ ----------
Net assets classified
as held for sale 205,448 (1,427) 30,007 (204,021) 30,007
10 SHARE CAPITAL
31 December 2018 30 June 2018
-------------------------------------- -------------------------------------
Number of Number of
shares USD'000 shares USD'000
Authorised:
Ordinary shares of USD0.01 500,000,000 5,000 500,000,000 5,000
each -------------------- ---------- -------------------- ----------
Issued and fully paid:
Opening balance (1 July
2018/ 1 July 2017) 163,399,888 1,634 257,987,620 2,580
Shares purchased and
cancelled (16,780,000) (168) (94,587,732) (946)
-------------------- ---------- -------------------- ----------
Closing balance 146,619,888 1,466 163,399,888 1,634
The Company considers investors holding more than a 10% beneficial interest in the ordinary shares of the Company as major shareholders. As at 31 December 2018, there were three investors that held more than 10% of the ordinary shares of the Company (30 June 2018: four).
During the period, the Company purchased and cancelled 16,780,000 of its ordinary shares (year ended 30 June 2018: 94,587,732 shares) for a total cash consideration of USD4.7 million (year ended 30 June 2018: USD73.0 million) at an average cost USD0.28 per share (year ended 30 June 2018: USD0.772 per share). The difference between the cost of the shares repurchased and their net asset value has been recorded in an equity reserve.
11 ADDITIONAL PAID-IN CAPITAL
Additional paid-in capital represents the excess of consideration received over the par value of shares issued.
31 December 30 June
2018 2018
USD'000 USD'000
Opening balance (1 July 2018/1 July
2017) 118,422 332,803
Shares repurchased and cancelled (4,712) (83,146)
Distributions to shareholders (45,452) (131,235)
-------------- --------------
Closing balance 68,258 118,422
On 16 November 2018, the Company announced that it would make a distribution of capital from its additional paid-in capital of USD45.5 million or 31 cents per ordinary share. As at 31 December 2018, this amount had been fully distributed.
12 CURRENT TRADE AND OTHER PAYABLES
31 December 30 June 2018
2018
USD'000 USD'000
Professional fees 1,844 3,154
Other payables 5 12
---------- ------------
1,849 3,166
All trade and other payables are short-term in nature. Their carrying values approximate their fair values as at the date of the condensed interim consolidated balance sheet.
13 SELLING AND ADMINISTRATION EXPENSES
Six months ended
--------------------------
31 December 31 December
2018 2017
USD'000 USD'000
Disposal and alignment fees under
the Third Amended and Restated Investment
Management Agreement (Note 19) 1,145 938
Professional fees (*) 1,336 1,002
General and administration expenses
(**) 225 202
Staff costs (**) - 251
Others (**) 184 42
---------- ----------
2,890 2,435
(*) These expenses primarily relate to the operating activities of the Company such as legal and professional fees, audit fees, valuation fees, fund administrative and custodian fees, directors fees.
(**) These expenses primarily relate to the operating activities of the Group's subsidiaries.
14 NET GAINS/(LOSSES) ON DISPOSALS OF INVESTMENTS
Six months ended
----------------------------
31 December 31 December
2018 2017
USD'000 USD'000
Losses on sales of subsidiaries (Note
6) (670) (20,168)
Gains on sales of assets classified
as held for sale 4,827 71
------------ ------------
4,157 (20,097)
15 INCOME TAX
VinaLand Limited is domiciled in the Cayman Islands. Under the current laws of the Cayman Islands, there are no income, corporation, capital gains or other taxes payable by the Company.
A number of subsidiaries are established in Vietnam and Singapore and are subject to corporate income tax in those countries. Deferred tax assets/liabilities of these subsidiaries are estimated based on the tax legislation of each jurisdiction and included in the deferred income tax assets/liabilities on the balance sheet.
As is the case with many other developing countries, Vietnam is in the process of implementing comprehensive tax regulations. As a result, the administration of tax regulations by government agencies may be subject to considerable discretion, and in many areas, the legal framework is uncertain and subject to interpretation. The Group has provided for all taxes expected to be payable by it under the current tax regulations in Vietnam. There is, however, an ongoing risk that government agencies might seek to impose additional taxes on the Group based on different interpretations of the regulations or through the retrospective application of new regulations.
On 19 June 2014, the Vietnamese National Assembly approved a new corporate income tax law. Under the new law, the standard corporate income tax was reduced from 25% to 22% effective 1 January 2015. A further reduction in tax rate to 20% became effective on 1 January 2016. No provision has been made for corporate income tax payable by the Vietnamese subsidiaries for the period because these subsidiaries do not have taxable income in Vietnam (period from 1 July 2017 to 31 December 2017: nil).
The relationship between the expected tax expense based on the applicable tax rate of 0% and the tax expense actually recognised in the condensed interim consolidated income statement can be reconciled as follows:
Six months ended
----------------------------
31 December 31 December
2018 2017
USD'000 USD'000
Current income tax
Group's gain/(loss) before tax 1,673 (17,057)
Group's gain multiplied by applicable - -
tax rate (0%)
Capital gains tax (1,965) (11,485)
------------ ------------
Total current tax expense (1,965) (11,485)
------------ ------------
Deferred income tax
Decrease in deferred tax assets - -
Decrease in deferred tax liabilities - 9,874
---------- ----------
Total deferred income tax income - 9,874
---------- ----------
Tax expense (1,965) (1,611)
16 DEFERRED INCOME TAX
Deferred income tax assets relating to the accumulated tax losses of the Group's subsidiaries subject to corporate income tax in Vietnam have not been recognised due to uncertainties as to the timing of their recoverability. Estimated tax losses available for offset against future taxable income are as follows:
Years of expiration
31 December 30 June 2018
2018
USD'000 USD'000
2019 - 13
2020 - 1,699
2021 - 210
2022 - 2,416
2023 - 550
---------- ----------
- 4,888
17 LOSS AND NET ASSET VALUE PER SHARE
(a) Basic
Six months ended
--------------------------------------------
31 December 31 December
2018 2017
Net loss attributable to owners of the Company
from continuing and total operations (USD'000) (292) (19,398)
Weighted average number of ordinary shares in issue 160,035,463 248,348,242
Basic loss per share from continuing and total
operations (USD per share) (0.00) (0.08)
-------------------- --------------------
(b) Diluted
Diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares outstanding to assume conversion of all dilutive potential ordinary shares. The Group has no category of potential dilutive ordinary shares. Therefore, diluted earnings per share is equal to basic earnings per share.
(c) Net asset value per share
31 December 30 June
2018 2018
Net asset value (USD'000) 525 46,931
Number of outstanding ordinary shares in issue 146,619,888 163,399,888
Net asset value per share (USD/share) 0.004 0.286
-------------------- --------------------
18 COMMITMENTS
As at 31 December 2018, the Group was not committed to any lease agreements (as at 30 June 2018: USD5,742).
19 RELATED PARTY TRANSACTIONS AND BALANCES
Management, disposal and alignment fees
The Group is managed by VinaCapital Investment Management Limited (the "Investment Manager"), an investment management company incorporated in the Cayman Islands.
Under the Third Amended and Restated Investment Management Agreement effective from 14 December 2016, no further management fees shall be charged by the Investment Manager to the Company (30 June 2017: nil). The Investment Manager receives a disposal fee and an alignment fee. The disposal fee is calculated at the rate of 3.00% of distributable funds realised in the year starting 22 November 2016, 2.75% in the second year and 2.25% in the third year. The alignment fee is calculated on distributions to shareholders over USD265.0 million during the 3-year period starting 22 November 2016. The Investment Manager will receive 10% of distributions over USD265.0 million and up to USD279.0 million, 15% of distributions over USD279.0 million, and up to USD313.0 million, and 20% of distributions over USD313.0 million. A non-refundable monthly advance of USD200,000 in the year starting 22 November 2016, USD150,000 in the second year, and USD100,000 in the third year, will be paid to the Investment Manager. These advances will be offset against disposal fees and alignment fees. During the period advances of USD0.8 million (30 June 2018: USD2.0 million) were paid and net off with disposal and alignment fees payable to the Investment Manager.
Details of disposal fees and alignment fees accrued at the balance date were as follows:
31 December 2018 30 June 2018
USD'000 USD'000
Disposal fees accrued 1 2,995
Disposal fees payable 1,887 733
Alignment fees accrued 37 7,766
Alignment fees payable 1,752 532
---------- ----------
Total fees accrued/payables at period/year end 3,677 12,026
Advance payments to be offset against fees payable - -
---------- ----------
Total disposal and alignment fees payable (*) 3,677 12,026
(*) Movement in accrual/payable disposal and alignment fees during the period/year were as follows:
31 December 2018 30 June 2018
USD'000 USD'000
Opening balance (1 July 2018/1 July 2017) 12,026 11,538
Charge for the period/year (Note 13) 1,145 4,083
Amounts settled (9,494) (3,595)
------------ ------------
Closing balance 3,677 12,026
Details of payables to related parties at the date of the condensed interim consolidated balance sheet are as below:
31 December 30 June
2018 2018
Relationship Balances USD'000 USD'000
Accrued disposal
VinaCapital Investment Investment and alignment
Management Ltd. Manager fees 38 10,761
Disposal and
alignment
fees payable 3,639 1,265
VinaCapital Vietnam Disposals
Opportunity Fund Under common of real estate
Limited ("VOF") management projects 52 565
------------ ------------
3,729 12,591
Advances to related parties as at 31 December 2018 were the non-refundable advances described under the section "Disposal fee and alignment fee" above.
The interests of the related parties in the shares, underlying shares and debentures of the Company are as follows:
As at
----------------------------------------
31 December 30 June
2018 2018
Number of shares
Asia Investment and Finance Ltd 30,376,000 -
Vietnam Investment Partners Ltd 22,286,457 22,286,457
VinaCapital Group Limited 608,553 608,553
------------------ ------------------
(*) In accordance with the Second Amended and Restated Investment Management Agreement, the Investment Manager was required to use 50% of the realisation fee arising from the contracted divestment proceeds collected to make market purchases of the Company's ordinary shares within three months of the receipt of the realisation fee. The shares acquired are subject to lockups of between one and two year from the date of acquisition. As at 31 December 2018, there were no ordinary shares under lockup (as at 30 June 2018: 7,039,279 ordinary shares).
20 FINANCIAL RISK MANAGEMENT (a) Financial risk factors
The Group holds a diversified property portfolio in Vietnam. As a result the Group is exposed to a variety of financial risks: market risk (including price risk, currency risk and interest rate risk); credit risk; and liquidity risk. The Group's overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Group's financial performance. The Group's risk management is coordinated by its Investment Manager who manages the distribution of the assets to achieve the investment objectives.
The condensed interim consolidated financial statements do not include all financial risk management information and disclosures required in the annual consolidated financial statements, and should be read in conjunction with the Group's annual consolidated financial statements as at 30 June 2018. There have been no major changes in the risk management department of the Investment Manager and risk management policies since the most recent year end.
(b) Fair value estimation
The table below analyses financial instruments carried at fair value by valuation method. The different levels have been defined as follows:
-- Quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1);
-- Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices) (Level 2); and
-- Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) (Level 3).
The following table presents the Group's assets and liabilities that are measured at fair value at 31 December 2018:
Level 1 Level 2 Level 3 Total
As at 31 December 2018 USD'000 USD'000 USD'000 USD'000
* Disposal fee and alignment fee - - (3,677) (3,677)
Level 1 Level 2 Level 3 Total
As at 30 June 2018 USD'000 USD'000 USD'000 USD'000
* Disposal fee and alignment fee - - (12,026) (12,026)
There were no significant transfers between levels during the period (year ended 30 June 2018: none).
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
END
IR UBVRRKAAOUAR
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