TIDMAAA
RNS Number : 4562J
All Asia Asset Capital Limited
28 June 2017
Press Release 28 June 2017
All Asia Asset Capital Limited
("All Asia Asset Capital", "AAA" or the "Company")
Results for the year ended 31 December 2016
All Asia Asset Capital (AIM: AAA), an investment company focused
on investing in the growing markets of the Asia Pacific region,
today announces its results for the year ended 31 December
2016.
All Asia Asset Capital Limited
Robert Berkeley, Executive Chairman and
Finance Director
Tel: +44 (0) 207 621 8910
Tel: +852 3756 0124
www.aaacap.com
Allenby Capital Limited
(Nominated Adviser and Broker)
Nick Athanas / Alex Brearley / Nick Naylor
Tel: +44 (0) 203 328 5656
www.allenbycapital.com
About AAA
AAA is an investment company that has been established as a
platform for investors looking to access growing markets in the
Asia-Pacific region. The Company invests in a portfolio of
companies with at least a majority of operations (or early-stage
companies that intend to have at least a majority of their
operations) in the Asia-Pacific region in industries with high
growth potential including, but not limited to: agriculture,
forestry and plantations, mining, natural resources, property,
and/or technology. AAA is publicly quoted and its shares are traded
on the AIM Market, which is operated by the London Stock
Exchange.
CHAIRMAN'S STATEMENT
I am pleased to present the results of All Asia Asset Capital
Limited (the "Company") together with its subsidiaries (the
"Group") for the year ending 31 December 2016.
Business Review
Between October 2013 and July 2014, the Company invested a total
of US$1,800,000 in cash to acquire the Company's stake in Andaman
Power & Utilities Co., Ltd. ("APU") (equivalent to
approximately GBP1,415,000 at current exchange rates). In addition,
in July 2014 the Company issued 11,000,000 new shares in AAA to the
Purchaser as part consideration for the acquisition of shares in
APU. The value attributed to AAA's investment in APU in the
Company's interim results for the period ended 30 June 2016,
announced by the Company on 16 September 2016, was GBP4,338,000,
which was based on an independent valuation report that was
commissioned by the Company.
In September 2016 and previously, the Company announced that APU
had become majority owned by United Power of Asia Public Company
Limited ("UPA"), a public listed company in Thailand, and that APU
was moving forward to further developments of 200 Megawatt plants
in the region. On 15 December 2016, the Company further announced
that it had become apparent to the Board that, due to the actions
of third parties, APU's effective economic interest in the project
company which intended to construct and operate the proposed power
plant project was likely to be substantially diluted. At that point
in time, the Board estimated that it was likely that AAA's
effective interest in the Proposed Power Plant Project would be
reduced to a level in the region of 0.07%. The Company highlighted
that these events would likely lead to a very substantial decrease
value in the Company's seven per cent interest in APU.
The Board investigated the above events and sought to take
further steps to clarify the situation. Following these actions, on
6 February 2017, the Board received an initial approach regarding
the purchase of 100% of the issued share capital of AAA's
subsidiary, Energy Central Limited ("Energy Central") for a cash
consideration of Thai Baht 34,889,000, which is equivalent of
approximately GBP0.8m at current exchange rates. Energy Central's
sole asset was the Company's interest in APU.
Subsequently the Company entered into a conditional sale and
purchase agreement with Chakris Kajkumjohndej (the "Purchaser") for
the disposal of Energy Central (the "Disposal"). Following the
approval of the Disposal by shareholders of AAA in a general
meeting held on 24 March 2017, full payment has been received and
the Disposal was subsequently completed. As part of the disposal,
the Company released the Purchaser and Mr. Upakit Pachariyangkun
from any and all claims, demands, obligations, liabilities, or
causes of action which the Company has or shall have in relation to
the purchase of APU's shares and potential damage to the Company
due to the action(s) of those persons or the majority
shareholder(s) of APU.
The consideration for the sale of Energy Central was determined
after arm's length negotiations between the Company and the
Purchaser. In the context of the difficulties described above, the
Directors considered that the consideration was fair and reasonable
and that pursuing the disposal was in the best interests of the
Company and its shareholders as a whole. The Directors believe that
this was especially the case when compared with alternative courses
of action, such as pursuing formal legal claims against the
original sellers of the shares in APU, given the likely timeframe
for the pursuit of any such legal claims and the uncertainly
regarding the likelihood of a superior outcome from any such
litigation.
With regard the Companies other investment, AAA still holds a
minority investment representing a 7% interest in Myanmar Allure
Group Co., Ltd. ("MAG"). During the year MAG continued operating
the Allure Resort, a combined hotel, resort and gaming facilities
located in Tachileik province, Myanmar, in the vicinity of the
Thailand-Myanmar Mae Sai border.
MAG is continuing to search for a partner and partnership
opportunities together with other entities who have a gaming
background, with a view to potentially having a partner co-invest
in new building development. During this time, MAG plan to continue
to improve their operations' performance and capacity utilisation
by maximising their existing resources.
The Company announced on 2 November 2016 that it was seeking to
take steps to actively realise the Company's investment in MAG. At
this stage the Company has not engaged in any advanced discussions
with third parties in respect of realising AAA's interest in
MAG.
In December 2016, the Company signed an agreement with Nature
Cove Holdings Limited, through which the Company was provided with
a convertible loan of GBP100,000 in cash provided by a shareholder
of the Company, in order to provide a short-term financing for the
Company. This loan was subsequently repaid in June 2017 and no
conversion of the loan's principal amount or interest into new
ordinary shares in the capital of the Company took place during the
term of the loan.
Financial Results
During the 12 months ended 31 December 2016, the Company made a
net loss of GBP0.5 million before taking into account the
impairment on the Company's investment in APU (2015: net loss of
GBP0.3 million). An impairment charge of GBP3.8 million was
incurred in the 12 months ended 31 December 2016 reflecting the
situation encountered with APU as detailed above and the subsequent
sale by AAA of its interest in APU for approximately GBP0.8m.
During the 12 months ended 31 December 2016, the majority of the
assets of the Group consisted of its two investments in APU and MAG
which, as at 31 December 2016, had a carrying value of GBP2.4
million in AAA's balance sheet. AAA's investments in APU and MAG
have been attributed fair values of GBP0.8 million and GBP1.59
million respectively as at 31 December 2016. The valuation on APU
takes into consideration, retrospectively, the sale of Energy
Central Limited that took place post year end.
As at 31 December 2016 the net assets of the Group were GBP2.12
million (31 December 2015: net assets of GBP5.68 million) and the
Group had cash and cash equivalents of GBP0.04 million (31 December
2015: cash and cash equivalents of GBP0.19 million). Further
details on the methodology for valuing the investments is contained
in note 7 to the financial statements. The Company's cash position
has improved since 31 December 2016 as a result of the cash
consideration received from the sale of Energy Central Limited.
Board Changes
On 21 April 2017 the Company announced that Mr. Paniti
Junhasavasdikul would step down as an executive director and
general counsel of the Company as of 30 April 2017. We extend our
gratitude to him for his diligence, commitment and contribution to
the Company during his tenure of office and we wish him the best
for his future endeavours.
The Company believes that it is very important that they
identify the right candidate to replace Paniti Junhasavasdikul who
possesses the skills and experience that match the strategic
direction of the business. The Company will provide an update on
their plans for the board once they have further assessed the
strategic direction of the Group following the sale of Energy
Central.
The Company announced on 2 November 2016 that they were
considering a proposal to amend the existing investing policy of
the Company and it was noted that this change in investing policy
would be subject to approval of shareholders. The Company intends
to re-assess this proposal once they have appointed a new Chief
Executive Officer.
Economic Outlook
With the Company's investee company, MAG, being located in
Myanmar is it important that we consider the current economic
climate. In a recent report, the World bank commented that
Myanmar's economy will grow by an average of 7.1% per year in the
next three years, as inflation pressures are expected to ease up
and private and public investments in infrastructure services and
non-commodity sectors, such as light manufacturing and hospitality,
are forecasted to rise. Given that MAG's focus is on the local
tourism and hospitality sector, this should be a positive
trend.
Appreciation
I would like to thank all the hard work of my fellow Board
members and staff, our advisers and of course our shareholders for
their continuing support for AAA. I sincerely hope that the Company
will continue to enjoy such support towards the development of the
Group in the years to come.
Robert Anthony Rowland Berkeley
Chairman
London, 28 June 2017
DIRECTORS' REPORT
The directors of the Company (the "Directors") present their
report and the audited financial statements for the year ended 31
December 2016.
Principal activity and investing policy3
All Asia Asset Capital Limited ("AAA" or "Company") is an
investment company incorporated in the British Virgin Islands on 14
September 2012. The Company has been established as a platform for
investors looking to access growing markets in the Asia Pacific
region. Its main country of operation is in Hong Kong.
The investment objective of the Company is to invest in a
portfolio of companies with at least the majority of their
operations (or early stage companies that intend to have at least
the majority of their operations) in the Asia Pacific region with
an expected initial focus on: Malaysia, Thailand, Indonesia and
Myanmar. The Directors intend to invest in companies that operate
(or early stage companies that intend to operate) in industries
with high growth potential including, but not limited to:
agriculture, forestry and plantations, mining, natural resources,
property and/or technology.
Review of business
As at 31 December 2016, the Company held two investments in its
portfolio.
Andaman Power and Utility Company Limited
Until 11 May 2017, All Asia Asset Capital Limited held a 7 per
cent. stake in Andaman Power and Utility Company Limited ("APU"), a
company based in Thailand and Myanmar, which operates in the
development of utility plants and the provision of electricity.
In September 2016 and previously, the Company announced that APU
had become majority owned by United Power of Asia Public Company
Limited ("UPA"), a public listed company in Thailand, and that APU
was moving forward to further developments of 200 Megawatt plants
in the region. On 15 December 2016, the Company further announced
that it had become apparent to the Board that, due to the actions
of third parties, APU's effective economic interest in the project
company which intended to construct and operate the proposed power
plant project was likely to be substantially diluted. At that point
in time, the Board estimated that it was likely that AAA's
effective interest in the Proposed Power Plant Project would be
reduced to a level in the region of 0.07%. The Company highlighted
that these events would likely lead to a very substantial decrease
value in the Company's seven per cent interest in APU.
The Board investigated the above events and sought to take
further steps to clarify the situation. Following these actions, on
6 February 2017, the Board received an initial approach regarding
the purchase of 100% of the issued share capital of AAA's
subsidiary, Energy Central Limited ("Energy Central"), for a cash
consideration of Thai Baht 34,889,000, which is equivalent of
GBP0.8m at current exchange rates. Energy Central's sole asset was
the Company's interest in APU.
The Company entered into a conditional sale and purchase
agreement with Chakris Kajkumjohndej (the "Purchaser") for the
disposal of Energy Central (the "Disposal"). Following the approval
of the Disposal by shareholders, full payment has been received and
the Disposal was completed. As part of the disposal, the Company
released the Purchaser and Mr. Upakit Pachariyangkun from any and
all claims, demands, obligations, liabilities, or causes of action
which the Company has or shall have in relation to the purchase of
APU's shares and potential damage to the Company due to the
action(s) of those persons or the majority shareholder(s) of
APU.
Myanmar Allure Group Company Limited
All Asia Asset Capital currently holds 7 per cent. stake in
Myanmar Allure Group Co., Ltd. ("MAG"). MAG is a privately held
company based in Thailand and Myanmar, which operates in the
hospitality and entertainment business.
MAG owns and operates the Allure Resort, a combined hotel,
resort and gaming facilities located in Tachileik province,
Myanmar, in the vicinity of the Thailand-Myanmar Mae Sai border.
The resort is situated in an 11-acre plot and is easily accessible
from Chiang Rai, Thailand and located within 5 minutes walk from
the border. It offers a variety of entertainment including gaming,
shopping and cultural sightseeing. MAG is continuing to search for
a partner and partnership opportunities together with other
entities who have a gaming background, with a view to potentially
having a partner co-invest in the new building development. During
this time, MAG plan to continue to improve their operations'
performance and capacity utilisation by maximising their existing
resources.
Capital Resources and Financing Structure
During the year ended 31 December 2015 the Company continued
utilising proceeds raised through two subscriptions with certain of
the Company's existing shareholders of the Company in April 2015
and May 2015 in which the Company raised approximately GBP490,000
by issuing 2,965,000 new ordinary shares in the Company of no par
value each at a price of 16.5 pence per share. No equity finance
was raised in 2016, although in December 2016, the Company signed
an agreement with Nature Cove Holdings Limited, through which the
Company was provided with a convertible loan of GBP100,000 in cash
provided by a shareholder of the Company, in order to provide a
short-term financing for the Company. This loan was subsequently
repaid in June 2017 and no conversion of the loan's principal
amount or interest into new ordinary shares in the capital of the
Company took place during the term of the loan.
International Financial Reporting Standards
The consolidated financial statements for the year ended 31
December 2016 together with comparative figures from the year ended
31 December 2015 have been prepared by using International
Financial Reporting Standards (IFRSs).
Results and dividends
The reported loss for the year was GBP4.35 million mainly
attributable to the impairment on AAA's investment in APU and
administrative expenses. Further details are set out in the
consolidated statement of profit or loss. No dividend has been paid
or proposed for the period.
Directors and their interests
The following Directors who served during the year ended 31
December 2016, together with their beneficial interests in the
ordinary share capital of the Company at the date of admission of
the Company to trading on AIM of London Stock Exchange are as
follows:
Shares Shares % at 31
held at held at December
2 May 2013 31 December 2016
Directors Position 2016
----------------------- -------------------------- ----------- ------------ ---------
Robert Anthony Rowland Executive Chairman
Berkeley and Finance Director 14,914,575 14,914,575 7.01%
Paniti Junhasavasdikul
(1) Executive Director - - -
Wai Tak Jonathan Chu Executive Director - - -
(Dominic) Seah Boon Independent Non-Executive
Chin Director - - -
Notes:
(1) Appointed on 9 September 2016 and resigned on 30 April
2017
Substantial interests
As at 31 December 2016, save for the Directors listed above, the
Directors were aware of the following interests amounting to 3% or
more of the ordinary share capital of the Company.
Percentage
Shareholder Number of Shares Shareholding
W B Nominees Limited 37,371,384 17.56%
Vidacos Nominees Limited 36,523,193 17.16%
Euroclear Nominees Limited 30,004,150 14.10%
Mr Robert John Sali 16,666,667 7.83%
Mr Blake Gordon Olafson 15,000,000 7.05%
Oxbow Enterprise Limited 14,914,575 7.01%
Chakris Kajkumjohndej 11,000,000 5.17%
The Bank of New York (Nominees
Limited) 7,881,001 3.70%
Chiefland Trading Limited 7,333,334 3.45%
Directors' Responsibilities Statement
The Directors are responsible for the preparation of
consolidated financial statements for each financial year. The
consolidated financial statements must give a true and fair view of
the state of affairs of the Company and its subsidiaries (the
"Group"), and the Group's profit and loss for that period.
When preparing consolidated financial statements, the Directors
are required to:
-- Select suitable accounting policies and apply them consistently
-- Make judgments and estimates that are reasonable
-- State whether they adhered to applicable accounting standards
subject to any material departures disclosed and explained in the
consolidated financial statements
-- Prepare the consolidated financial statements on a going
concern basis, unless it is inappropriate to presume that the
Company will continue in business
The Directors must keep proper accounting records, which
disclose, with reasonable accuracy at any time, the financial
position of the Group and the Company. The Directors must ensure
that the consolidated financial statements comply with applicable
laws and follow International Financial Reporting Standards. The
Directors must also safeguard the assets of the Group and the
Company, and take reasonable steps to prevent and detect fraud or
other irregularities.
Website publication
The Directors are responsible for ensuring the annual report and
the financial statements are made available on a website. Financial
statements are published on the Company's website in accordance
with AIM Rules. The maintenance and integrity of information
presented in the Company's website is the responsibility of the
Directors, therefore the Directors' responsibility also extends to
the ongoing integrity of the financial statements contained
therein.
Auditors
Elite Partners CPA Limited was appointed auditors at the
conclusion of the Company's annual general meeting held on 18 July
2016. A resolution to re-appoint Elite Partners CPA Limited as the
Company's auditors will be proposed at the forthcoming Annual
General Meeting.
Approved by the Board and signed on behalf of the Board.
Robert Anthony Rowland Berkeley
Chairman
London, 28 June 2017
CORPORATE GOVERNANCE STATEMENT
Board of Directors
During the year ended 31 December 2016, the following persons
served as directors of the Company:
Executive Directors:
Robert Anthony Rowland Berkeley
Paniti Junhasavasdikul (appointed on 9 September 2016)
Wai Tak Jonathan Chu
Independent Non-Executive Director:
(Dominic) Seah Boon Chin
The Directors are not related to each other.
Responsibilities of the Board
The Directors are responsible for the overall management and
control of the Company as well as identifying investment
opportunities, managing the investment/acquisition process and
monitoring the investee companies' operating performance. The
Directors will review the operations of the Company at regular
board meetings and it is currently intended that the Board will
meet at least four times a year and at other times as and when
required.
The Directors recognise the importance of sound corporate
governance commensurate with the size of the Company and the
interests of Shareholders and intend that, following Admission, the
Company will comply with the main provisions of the Corporate
Governance Guidelines for Smaller Quoted Companies published by the
Quoted Companies Alliance to the extent that they believe it is
appropriate in light of the size, stage of development and
resources of the Company.
Board Committee
As there is currently only one independent non-executive
director of the Company, being Dominic Seah Boon Chin, the Board
has not established remuneration, nomination and audit committees.
Until the appointment of a further independent non-executive
director, Dominic Seah Boon Chin will be responsible for the
Company's remuneration policy and the Board as a whole will monitor
the performance of the Board and plans for succession and the
functions usually carried out by a nominations committee. Until an
audit committee is appointed, the Board as a whole will be
responsible for reviewing and monitoring internal financial control
systems and risk management systems on which the Company is
reliant, considering annual and interim accounts and audit reports,
considering the appointment and remuneration of the Company's
auditor and monitoring and reviewing annually their independence,
objectivity, effectiveness and qualifications
INVESTING POLICY
(Adopted at the Annual General Meeting of the Company on 10
December 2013)
The Company intends to invest in companies with at least the
majority of their operations (or early stage companies that intend
to have at least the majority of their operations) in the Asia
Pacific region. The Company intends to invest in a portfolio of
companies with an initial focus on companies that operate (or early
stage companies that intend to operate) in industries with likely
high growth potential including, but not limited to: agriculture,
forestry and plantation, mining, natural resources, property and/or
technology.
The Directors intend to source and identify potential
investments in line with the Investing Policy through their own
research and network of contacts and possibly strategic
partnerships with other companies or persons who can assist the
Company in sourcing and identifying potential investments.
Investments are expected to be mainly in the form of equity
although investments may be by way of debt, convertible securities
or investments in specific projects. In the case of equity
investments, the Directors intend typically to take minority
positions (with suitable minority protection rights), primarily in
unquoted companies. Investments will therefore typically be of a
passive nature. However, whilst the Directors intend that typical
investments will constitute minority positions in investee
companies, should the Company make majority investments, the
Company may seek participation in the management or board of
directors of such an entity with a view to seeking to improve the
performance and growth of the business.
There is no limit on the size of an investment in a project. The
Directors expect that each investment will typically yield a
targeted internal rate of return of at least 20 to 30 per cent. per
annum. It is likely that a substantial portion of the Company's
financial resources will be invested in a small number of
companies, however the Company has not excluded the possibility of
making just one investment. Depending on the size of investments,
they may be deemed to be reverse takeovers for the purposes of the
AIM Rules, which would require Shareholder approval and
re-admission of the Company, as enlarged by the acquisition, to
trading on AIM.
In addition to paying the costs of the Company's ongoing
expenses, the Company's cash resources will primarily be used to
identify, evaluate and select suitable investment opportunities and
to make investments, either in part or in full, as applicable. The
Directors consider that as investments are made, or promising new
investment opportunities arise, further funding of the Company will
be required and they anticipate further equity fundraisings by the
Company. Subject to prevailing authorities to issue new Ordinary
Shares or, if required, with Shareholder approval, new Ordinary
Shares may be used as consideration, in whole or in part, for
investments. The Company will not be subject to any borrowing or
leverage limits. In order to mitigate investment risk, the
Directors intend to carry out a thorough due diligence process in
evaluating each potential investment including: site visits,
analysis of financial, legal and operational aspects of each
investment opportunity, meetings with management, risk analysis,
review of corporate governance and anti-corruption procedures and
the seeking of third party expert opinions and valuation reports
where the Directors see fit.
The Directors will apply investment criteria including: the
potential for capital growth and/or the potential for profit
generation with a view to receiving dividend income over time, high
attractiveness to potential buyers of the company in question in
order to facilitate exits and a strong and experienced management
team.
Given the time frame to fully maximise the value of an
investment, the Board expects that investments will be held for the
medium to long term, although short-term disposals of assets cannot
be ruled out in exceptional or opportunistic circumstances. The
Directors intend to re-invest the proceeds of disposals in
accordance with the Company's Investing Policy unless, at the
relevant time, the Directors believe that there are no suitable
investment opportunities in which case the Directors will consider
returning the proceeds to Shareholders in a tax efficient
manner.
Cash held by the Company pending investment, reinvestment or
distribution will be managed by the Company and placed in bank
deposits or in capital guaranteed schemes offered by major global
financial institutions, in order to protect the capital value of
the Company's cash assets. The Company may, where appropriate, also
enter into agreements or contracts in order to hedge against
interest rate or currency risks. Investments are expected to be
held by the Company or a subsidiary to be incorporated for the
purpose of holding an investment.
Any material change to the Company's Investing Policy will only
be made following the approval by ordinary resolution of
Shareholders in general meeting. In addition, if the Company has
not substantially implemented its Investing Policy within 18 months
of Admission, the Company will seek the approval of Shareholders at
its next annual general meeting for its Investing Policy and on
annual bases thereafter until such time that its Investing Policy
has been substantially implemented. If it appears unlikely that the
Company's Investing Policy can be implemented at any time, the
Directors will consider returning remaining funds to
Shareholders.
The Directors will review the Investing Policy on an annual
basis and will implement any non-material changes or variations as
they consider fit. Details of any such non-material changes or
variations will be announced as appropriate. Any material change or
variation of the Investing Policy will be subject to the prior
approval of Shareholders
BOARD OF DIRECTORS
Robert Berkeley (Executive Chairman and Finance Director)
Robert qualified as a chartered accountant with Arthur Andersen
and Co in 1990 and has had a successful career in senior management
within the retail, construction, headhunting and financial services
sectors. In 1999, he was appointed to Harvey Nash Plc's European
Management Board, significantly developing the business across
Europe, as well as placing senior executives within major
international organisations. Since 2009, Robert has successfully
established Vantage FX UK Trading Limited, an FSA regulated online
forex broker based in London, a significant player in the FX market
across Europe with strong growth year on year. Robert is currently
the Managing Director of Vantage FX UK Trading Limited. Robert's
position as Executive Chairman and Finance Director is on a part
time basis.
Paniti Junhasavasdikul (Chief Executive Officer)
Mr. Junhasavasdikul has 20 years of legal, interim management
and private equity experience. He has worked as a lawyer in various
transactions and investments ranging from start-ups, M&A,
special situation investments, debt trades, turnarounds, disputes
and corporate governance. He was a co-founder of FBLP Legal Co.,
Ltd where he was a partner from 2000 to 2007 before the practice
was merged with DFDL International Law Offices where he was an
equity partner between 2007 to 2010, based in the CLMV (Cambodia,
Laos, Myanmar and Vietnam) countries. Paniti was a member of the
International Advisory Council of International and Executive Legal
Education (IELE), Berkeley Law, University of California between
2009 and 2014. He graduated with an LLB from Chulalongkorn
University, Faculty of Law in 1992 and received an LLM from
University of California, Berkeley in 1995. He is a member of the
Thai Bar Association and the Law Society of Thailand.
Mr. Junhasavasdikul was appointed to the board of AAA on 9
September 2016 and subsequently resigned on 30 April 2017.
Wai Tak Jonathan Chu
Jonathan has over twenty years of experience in property
investment and asset management, investor relations and corporate
finance mostly in Hong Kong. He was a Senior Property Manager at
Hon Kwok Land Investments Co. Ltd., a property developer company
listed on the main board of the Hong Kong Stock Exchange, from
September 1988 to April 2004. He was a consultant with Ketchum
Newscan Public Relations Limited in Hong Kong from December 2009 to
February 2011. He was an Investor Relations Manager at Zhengye
International Holdings Co. Ltd. from June 2012 to October 2013 and
an Investor Relations Manager at Modern (HR) Limited from August
2011 to April 2012, both companies listed on the main board of the
Hong Kong Stock Exchange. Jonathan received his BA (Hons) in
Economics and Social Studies from the University of Manchester and
a Master of Science in Financial Engineering from the City
University of Hong Kong.
Dominic Seah Boon Chin (Independent Non-Executive Director)
Dominic began his career in 1995 as a senior officer at Chung
Khiaw Bank (Malaysia) Bhd. (now known as United Overseas Bank
(Malaysia) Berhad). From 1997 to January 2007, he worked in several
established financial institutions in Malaysia and Singapore,
including CIMB Investment Bank Berhad, Affin Investment Bank Berhad
and Public Investment Bank Berhad, mainly focused in corporate
finance. Subsequently he joined MobilityOne Limited (which is
quoted on AIM) as its corporate finance director and has been a
non-executive director there since November 2011. He is currently
the head of corporate finance at TA Securities Holdings Berhad, a
stockbroking firm in Malaysia. He obtained his Bachelor of Commerce
(Honours) degree with distinction from McMaster University,
Canada.
INDEPENT AUDITOR'S REPORT
TO THE MEMBERS OF ALL ASIA ASSET CAPITAL LIMITED
(Incorporated in the British Virgin Islands with limited
liability)
Opinion
We have audited the consolidated financial statements of All
Asia Asset Capital Limited (the "Company") and its subsidiaries
(collectively referred to as the "Group") set out on pages 21 to
57, which comprise the consolidated statement of financial position
as at 31 December 2016, and the consolidated statement of profit or
loss and other comprehensive income, the consolidated statement of
changes in equity and the consolidated statement of cash flows for
the year then ended, and notes to the consolidated financial
statements, including a summary of significant accounting
policies.
In our opinion, the consolidated financial statements present
fairly, in all materials respects the consolidated financial
position of the Group as at 31 December 2016, and of its
consolidated financial performance and its consolidated cash flows
for the year then ended in accordance with International Financial
Reporting Standards ("IFRSs") issued by the International
Accounting Standards Board ("IASB").
Basis for Opinion
We conducted our audit in accordance with International
Standards on Auditing ("ISAs") issued by the International
Federation of Accountants ("IFAC"). Our responsibilities under
those standards are further described in the Auditor's
Responsibilities for the Audit of the Consolidated Financial
Statements section of our report. We are independent of the Group
in accordance with the International Ethics Standards Board for
Accountants' "Code of Ethics for Professional Accountants" (the
"Code") and we have fulfilled our other ethical responsibilities in
accordance with these requirements and the Code. We believe that
the audit evidence we have obtained is sufficient and appropriate
to provide a basis for our opinion.
Key Audit Matters
Key audit matters are the matters that, in our professional
judgment, were of most significance in our audit of the
consolidated financial statements for the year ended 31 December
2016. These matters were addressed in the context of our audit of
the consolidated financial statements as a whole, and in forming
our opinion thereon, and we do not provide a separate opinion on
these matters.
TO THE MEMBERS OF ALL ASIA ASSET CAPITAL LIMITED
(Incorporated in British Virgin Islands with limited
liability)
Key audit matter How the matter was addressed
in our audit
----------------------------------------------- -------------------------------------------------------------
Valuation of the Group's available-for-sale
financial assets measured at
fair value categorised as level
3 of fair value hierarchy
----------------------------------------------- -------------------------------------------------------------
As at 31 December 2016, the Group's Our major audit procedures
available-for-sale financial in relation to this matter
assets of approximately GBP2.42 included the following:
million were investments in unlisted * We evaluated the competence, capabilities and
equity securities whose fair independence of the Group's external valuer;
value measurements were categorised
as level 3 in the fair value
hierarchy defined in IFRS 13. * We assessed the appropriateness for the selection of
the discounted cash flow model as the valuation
The valuation of the available-for-sale technique used by management based on the market
financial assets involved high practice and our knowledge of the nature of the
degree of estimation uncertainty, financial assets;
subjectivity and management judgement.
We have identified the fair value * We evaluated the judgement made by management in
measurement of the Group's available-for-sale determining the key assumptions, including credit
financial assets as a key audit spread rate and volatility, by comparing the
matter because the fair value supporting documentation to external market analysis.
of which were derived from valuation We also performed an independent sensitivity analysis
techniques that include inputs to evaluate those assumptions applied to the
for assets that are not based valuation model for calculating the fair value of the
on observable market date and financial assets; and
high degree of management judgement
was required in determining the
assumptions to use in arriving * We checked the mathematical accuracy of the
at the unobservable inputs. discounted cash flow model prepared by management via
reperformance.
----------------------------------------------- -------------------------------------------------------------
Information other than the Consolidated Financial Statements and
Auditor's Report Thereon
The directors are responsible for the other information. The
other information comprises the information included in the annual
report, but does not include the consolidated financial statements
and our auditor's report thereon.
Our opinion on the consolidated financial statements does not
cover the other information and we do not express any form of
assurance conclusion thereon.
In connection with our audit of the consolidated financial
statements, our responsibility is to read the other information
and, in doing so, consider whether the other information is
materially inconsistent with the consolidated financial statements
or our knowledge obtained in the audit or otherwise appears to be
materially misstated. 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.
TO THE MEMBERS OF ALL ASIA ASSET CAPITAL LIMITED
(Incorporated in British Virgin Islands with limited
liability)
Responsibilities of Directors and Those Charged with Governance
for the Consolidated Financial Statements
The directors are responsible for the preparation and fair
presentation of the consolidated financial statements in accordance
with IFRSs issued by the IFAC, and for such internal control as the
directors determine is necessary to enable the preparation of
consolidated financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, the
directors are responsible for assessing the Group'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 to cease operations, or have no realistic alternative but
to do so.
The directors are also responsible for overseeing the Group's
financial reporting process.
Auditor's Responsibilities for the Audit of the Consolidated
Financial Statements
Our objectives are to obtain reasonable assurance about whether
the consolidated 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 solely to you, as a
body, in accordance with our agreed terms of engagement, and for no
other purpose. We do not assume responsibility towards or accept
liability to any other person for the contents of this report.
Reasonable assurance is a high level of assurance, but is not a
guarantee that an audit conducted in accordance with ISAs 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 consolidated financial statements.
As part of an audit in accordance with ISAs, we exercise
professional judgment and maintain professional scepticism
throughout the audit. We also:
-- Identify and assess the risks of material misstatement of the
consolidated financial statements, whether due to fraud or error,
design and perform audit procedures responsive to those risks, and
obtain audit evidence that is sufficient and appropriate to provide
a basis for our opinion. The risk of not detecting a material
misstatement resulting from fraud is higher than for one resulting
from error, as fraud may involve collusion, forgery, intentional
omissions, misrepresentations, or the override of internal
control.
-- Obtain an understanding of internal control relevant to the
audit in order to design audit procedures that are appropriate in
the circumstances, but not for the purpose of expressing an opinion
on the effectiveness of the Group's internal control.
-- Evaluate the appropriateness of accounting policies used and
the reasonableness of accounting estimates and related disclosures
made by the directors.
-- Conclude on the appropriateness of the directors' use of the
going concern basis of accounting and, based on the audit evidence
obtained, whether a material uncertainty exists related to events
or conditions that may cast significant doubt on the Group's
ability to continue as a going concern. If we conclude that a
material uncertainty exists, we are required to draw attention in
our auditor's report to the related disclosures in the consolidated
financial statements or, if such disclosures are inadequate, to
modify our opinion. Our conclusions are based on the audit evidence
obtained up to the date of our auditor's report. However, future
events or conditions may cause the Group to cease to continue as a
going concern.
INDEPENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ALL ASIA ASSET CAPITAL LIMITED
(Incorporated in British Virgin Islands with limited
liability)
Auditor's Responsibilities for the Audit of the Consolidated
Financial Statements (continued)
-- Evaluate the overall presentation, structure and content of
the consolidated financial statements, including the disclosures,
and whether the consolidated financial statements represent the
underlying transactions and events in a manner that achieves fair
presentation.
-- Obtain sufficient appropriate audit evidence regarding the
financial information of the entities or business activities within
the Group to express an opinion on the consolidated financial
statements. We are responsible for the direction, supervision and
performance of the group audit. We remain solely responsible for
our audit opinion.
We communicate with the audit committee regarding, among other
matters, the planned scope and timing of the audit and significant
audit findings, including any significant deficiencies in internal
control that we identify during our audit.
We also provide the audit committee with a statement that we
have complied with relevant ethical requirements regarding
independence, and to communicate with them all relationships and
other matters that may reasonably be thought to bear on our
independence, and where applicable, related safeguards.
From the matters communicated with the audit committee, we
determine those matters that were of most significance in the audit
of the consolidated financial statements of the current period and
are therefore the key audit matters. We describe these matters in
our auditor's report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare
circumstances, we determine that a matter should not be
communicated in our report because the adverse consequences of
doing so would reasonably be expected to outweigh the public
interest benefits of such communication.
The engagement partner on the audit resulting in the independent
auditor's report is Yip Kai Yin with Practising Certificate number
P05131.
Elite Partners CPA Limited
Certified Public Accountants
10/F., 8 Observatory Road,
Tsim Sha Tsui, Kowloon,
Hong Kong
28 June 2017
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
FOR THE YEARED 31 DECEMBER 2016
Notes 2016 2015
----------- ---------
GBP GBP
Other income 5 377 6,101
Impairment of available-for-sale
financial assets (3,881,471) -
Change in fair value of
convertible loan designated
at fair value through profit
or loss (220,243) -
Administrative expenses (250,096) (307,247)
----------- ---------
Loss before tax 6 (4,351,433) (301,146)
Income tax 8 - -
----------- ---------
Loss for the year (4,351,433) (301,146)
----------- ---------
Loss per ordinary share
(in pence)
- Basic 9(a) (2.04) (0.14)
----------- ---------
- Diluted 9(b) (2.04) (0.14)
----------- ---------
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE
INCOME FOR THE YEARED 31 DECEMBER 2016
Notes 2016 2015
----------- ---------
GBP GBP
Loss for the year (4,351,433) (301,146)
Other comprehensive income:
Items that may reclassified
subsequently to profit
or loss
Fair value (loss)/ gain
on available-for-sale financial
assets (3,941,228) 33,104
Reclassification adjustment
relating to impairment
of available-for-sale financial
assets during the year 3,881,471 -
Exchange difference on
translating financial statements
of foreign subsidiaries 858,489 255,870
----------- ---------
Other comprehensive income,
net of tax 798,732 288,974
----------- ---------
Total comprehensive expense
for the year (3,552,701) (12,172)
----------- ---------
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2016
As at As at
Notes 31 Dec 2016 31 Dec 2015
GBP GBP
ASSETS
Non-current assets
Property, plant and equipment 11 10,276 12,919
Available-for-sale financial
assets 13 2,416,336 5,490,437
----------- ------------------
2,426,612 5,503,356
----------- ------------------
Current assets
Prepayments and deposits 8,932 4,830
Cash and bank balances 14 44,648 186,783
----------- ------------------
Total current assets 53,580 191,613
-----------
Total assets 2,480,192 5,694,969
----------- ------------------
CAPITAL AND RESERVES
Share capital 15 6,284,194 6,284,194
Reserves 17 (4,158,176) (605,475)
-----------
Total equity 2,126,018 5,678,719
----------- ------------------
LIABILITIES
Current liabilities
Other payables and accruals 18 33,931 16,250
----------- ------------------
Non-current liabilities
Convertible loan 20 320,243 -
----------- ------------------
Total liabilities 354,174 16,250
----------- ------------------
Total equity and liabilities 2,480,192 5,694,969
----------- ------------------
Net current assets 19,649 175,363
----------- ------------------
Total assets less current
liabilities 2,446,261 5,678,719
----------- ------------------
Net assets 2,126,018 5,678,719
----------- ------------------
Approved by the board of directors on 28 June 2017
Wai Tak Jonathan Chu Robert Anthony Rowland Berkeley
Director Director
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEARED 31 DECEMBER 2016
Fair Share
Share value option Exchange Accumulated
capital reserve reserve reserve loss Total
------------ ----------- ----------- ----------- ------------ --------------
GBP GBP GBP GBP GBP GBP
At 1January
2015 5,794,969 147,675 180,051 345,234 (1,130,337) 5,337,592
Loss for the
year - - - - (301,146) (301,146)
Other comprehensive
income:
Loss on fair
value change
on available-
for-sale financial
assets - 33,104 - - - 33,104
Exchange difference
on translating
of financial
statement of
overseas subsidiaries - - - 255,870 - 255,870
------------ ----------- ----------- ----------- ------------ --------------
Total comprehensive
income for
the year - 33,104 - 255,870 (301,146) (12,172)
Issuance of
shares 489,225 - - - - 489,225
Lapse of share
option - - (135,926) - - (135,926)
------------ ----------- ----------- ----------- ------------ --------------
As at 31 Dec
2015 and 1
Jan 2016 6,284,194 180,779 44,125 601,104 (1,431,483) 5,678,719
Loss for the
year - - - - (4,351,433) (4,351,433)
Other comprehensive
income:
Loss on fair
value change
on available-
for-sale financial
assets - (4,169,030) - - - (4,169,030)
Reclassification
adjustment
relating
to impairments
of available-for-sale
investment
during the
year - 3,881,471 - - - 3,881,471
Exchange difference
on translating
of financial
statement of
overseas subsidiaries - - - 1,086,291 - 1,086,291
------------ ----------- ----------- ----------- ------------ --------------
Total comprehensive
income for
the year - (287,559) - 1,086,291 (4,351,433) (3,552,701)
------------ ----------- ----------- ----------- ------------ --------------
As at 31 December
2016 6,284,194 (106,780) 44,125 1,687,395 (5,782,916) 2,126,018
------------ ----------- ----------- ----------- ------------ --------------
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEARED 31 DECEMBER 2016
2016 2015
----------- ----------------
GBP GBP
Operating activities
Loss before taxation (4,351,433) (301,146)
Adjustments for:
Bank interest income (3) (6)
Depreciation of property, plant and equipment 2,979 2,786
Impairment loss on available-for-sale financial
assets 3,881,471 -
Change in fair value of convertible loans
designated at fair value through profit
or loss 220,243 -
Reversal of equity-settled share-based
payments - (135,926)
----------- ----------------
Operating loss before working capital changes (276,743) (434,292)
(Increase)/ Decrease in prepayments and
deposits (4,102) 10,722
Increase/ (Decrease) in other payables
and accruals 17,681 (329,822)
----------- ----------------
Cash used in operations (233,164) (753,392)
Interest received 3 6
----------- ----------------
Net cash used in operating activities (233,161) (753,386)
----------- ----------------
Investing activities
Purchase of property, plant and equipment - (810)
----------- ----------------
Net cash used in investing activities - (810)
----------- ----------------
Financing activities
Issuance of share capital - 489,225
Proceeds from issue of convertible loans 100,000 -
----------- ----------------
Net cash generated from financing activities 100,000 489,225
----------- ----------------
Net decrease in cash and cash equivalents (133,161) (264,971)
Effect of foreign exchange rate changes,
net (8,974) (641)
Cash and cash equivalents at the beginning
of the year 186,783 452,395
----------- ----------------
Cash and cash equivalents at the end of
the year 44,648 186,783
----------- ----------------
Analysis of balances of cash and cash equivalents
Cash and bank balances 44,648 186,783
----------- ----------------
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARED 31 DECEMBER 2016
1. GENERAL INFORMATION
The Company was incorporated in the British Virgin Islands on 14
September 2012 with limited liability and had obtained the
admission by the London Stock Exchange to be traded in AIM market
on 2 May 2013. The registered office of the Company is located at
Commerce House, Wickhams Cay 1, P.O. Box 3140, Road Town, Tortola,
British Virgin Islands and the operating office is located at Unit
2302, 23/F., New World Tower 1, 18 Queen's Road Central, Central,
Hong Kong.
The principal activity of the Company and its subsidiaries
(collectively referred as to the "Group") is to invest in growing
markets of Asia Pacific.
The consolidated financial statements are presented in Great
British Pounds ("GBP"), which is the same as the functional
currency of the Company, and all value is round to the nearest GBP.
It is prepared on historical cost basis except for
available-for-sale financial assets and the share-based payment
that are stated at fair value.
2. APPLICATION OF NEW AND REVISED INTERNATIONAL FINANCIAL REPORTING STANDARDS ("IFRSs")
2.1 Amendments to IFRSs that are mandatorily effective for the current year
In the current year, the Group has applied a number of
amendments to IFRSs issued by the International Accounting
Standards Board ("IASB") that are mandatorily effective for an
accounting period that begins on or after 1 January 2016. These
amendments have been applied by the Group for the first time in the
current year unless otherwise specified. The impact of these
amendments are described below.
Amendments to IAS 1 Disclosure Initiative
The amendments clarify that an entity need not provide a
specific disclosure required by a IFRS if the information resulting
from that disclosure is not material (even if the IFRS contains a
list of specific requirements or describes them as minimum
requirements). The amendments also give guidance on the bases of
aggregating and disaggregating information for disclosure purposes.
The amendments emphasise that an entity should consider whether to
provide additional disclosures when compliance with the specific
requirements in IFRSs is insufficient to enable users of financial
statements to understand the impact of particular transactions,
other events and conditions on the entity's financial position and
financial performance.
The application of these amendments has not resulted in any
impact on the financial performance or financial position of the
Group.
2.2 New and revised IFRSs that are not mandatorily effective for the current year
The Group has not applied any of the following new and revised
IFRSs that have been issued but are not yet mandatorily
effective:
IFRS 9 Financial Instruments(1)
IFRS 15 Revenue from Contracts with Customers(1)
IFRS 16 Leases(2)
IFRS 17 Insurance Contracts(6)
IFRIC 22 Foreign Currency Transactions and Advance
Consideration(1)
IFRIC 23 Uncertainty over Income Tax Treatments(2)
Amendments to IFRS 2 Classification and Measurement of Share-based Payment
Transactions(1)
Amendments to IFRS 4 Applying IFRS 9 Financial Instruments with IFRS 4
Insurance Contracts(1)
Amendments to IFRS15 Clarifications to IFRS 15 Revenue from Contracts with
Customers(1)
Amendments to IFRS 10 Sale or Contribution of Assets between an Investor and its
and IAS 28 Associate or Joint Venture(3)
Amendments to IAS 7 Disclosure Initiative(4)
Amendments to IAS 12 Recognition of Deferred Tax Assets for Unrealised Losses(4)
Amendments to IAS 40 Transfers of Investment Property(1)
Amendments to IFRSs Annual Improvements to IFRSs 2014-2016 Cycle(5)
(1) Effective for annual periods beginning on or after 1 January
2018
(2) Effective for annual periods beginning on or after 1 January
2019
(3) Effective for annual periods beginning on or after a date to
be determined
(4) Effective for annual periods beginning on or after 1 January
2017
(5) Effective for annual periods beginning on or after 1 January
2017 or 1 January 2018, as appropriate
(6) Effective for annual periods beginning on or after 1 January
2021
IFRS 9 Financial Instruments
IFRS 9 has introduced new requirements for a) classification and
measurement of financial assets, b) impairment of financial assets
and c) general hedge accounting.
Specifically, with regard to the classification and measurement
of financial assets, IFRS 9 requires all recognised financial
assets that are within the scope of IFRS 9 to be subsequently
measured at amortised cost or fair value. Debt investments that are
held within a business model whose objective is to collect the
contractual cash flows, and that have contractual cash flows that
are solely payments of principal and interest on the principal
outstanding are generally measured at amortised cost at the end of
each of the subsequent accounting periods. Debt investments that
are held within a business model whose objective is achieved both
by collecting contractual cash flows and selling financial assets,
and that have contractual terms that are solely payments of
principal and interest on the principal amount outstanding, are
generally measured at fair value through other comprehensive income
(FVTOCI). All other debt investments and equity investments are
measured at their fair value at the end of subsequent accounting
periods. Further, under IFRS 9, entities may make an irrevocable
election to present subsequent changes in the fair value of an
equity investment (that is not held for trading nor contingent
consideration recognised by an acquirer in a business combination
to which IFRS 3 applies) in other comprehensive income, with only
dividend income generally recognised in profit or loss and that
cumulative fair value changes will not be reclassified to profit or
loss upon derecognition of the investment.
2.2 New and revised IFRSs that are not mandatorily effective for the current year
IFRS 9 Financial Instruments (continued)
With regard to the measurement of financial liabilities
designated as at fair value through profit or loss, IFRS 9 requires
that the amount of change in the fair value of a financial
liability that is attributable to changes in the credit risk of
that liability is presented in other comprehensive income, unless
the recognition of such changes in other comprehensive income would
create or enlarge an accounting mismatch in profit or loss. Changes
in fair value attributable to a financial liability's credit risk
are not subsequently reclassified to profit or loss. Under IAS 39,
the entire amount of the change in the fair value of the financial
liability designated as fair value through profit or loss is
presented in profit or loss.
With regard to impairment of financial assets, IFRS 9 has
adopted an expected credit loss model, as opposed to an incurred
credit loss model required under IAS 39. In general, the expected
credit loss model requires an entity to assess the change in credit
risk of the financial asset since initial recognition at each
reporting date and to recognise the expected credit loss depending
on the degree of the change in credit risk.
With regard to the general hedge accounting requirements, IFRS 9
retains the three types of hedge accounting mechanisms currently
available in IAS 39. Under IFRS 9, greater flexibility has been
introduced to the types of transactions eligible for hedge
accounting, specifically broadening the types of instruments that
qualify for hedging instruments and the types of risk components of
non-financial items that are eligible for hedge accounting. In
addition, the effectiveness test has been overhauled and replaced
with the principle of an 'economic relationship'. Retrospective
assessment of hedge effectiveness is also no longer required.
Enhanced disclosure requirements about an entity's risk management
activities have also been introduced.
The Group is still in the process of assessing the impact of
IFRS 9. The directors of the Company believe that it is impractical
to disclose the impact in these consolidated financial statements
until the Group has completed the assessment.
Amendments to IAS 7 Disclosure Initiative
The amendments require an entity to make disclosures that enable
users of financial statements to evaluate changes in liabilities
arising from financing activities. The directors of the Company do
not anticipate that the application of these amendments will have a
material impact on the Group's consolidated financial
statements.
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The consolidated financial statements have been prepared on a
going concern basis. The preparation of these financial statements
in conformity with IFRSs requires the use of certain critical
accounting estimates. It also requires the directors of the Company
to exercise judgment in the process of applying the Group's
accounting policies. The areas involving a higher degree of
judgment or complexity, or areas where assumptions and estimates
are significant to these financial statements are disclosed in Note
4.
(a) Basis of consolidation
The consolidated financial statements incorporate the financial
statements of the Company and entities controlled by the Company
and its subsidiaries. Control is achieved when the Company:
has power over the investee;
is exposed, or has rights, to variable returns from its
involvement with the investee; and
has the ability to use its power to affect its returns.
The Group reassesses whether or not it controls an investee if
facts and circumstances indicate that there are changes to one or
more of the three elements of control listed above.
Consolidation of a subsidiary begins when the Group obtains
control over the subsidiary and ceases when the Group loses control
of the subsidiary. Specifically, income and expenses of a
subsidiary acquired or disposed of during the year are included in
the consolidated statement of profit or loss from the date the
Group gains control until the date when the Group ceases to control
the subsidiary.
Profit or loss and each component of other comprehensive income
are attributed to the owners of the Company and to the
non-controlling interests. Total comprehensive income of
subsidiaries is attributed to the owners of the Company and to the
non-controlling interests even if this results in the
non-controlling interests having a deficit balance.
Where necessary, adjustments are made to the financial
statements of subsidiaries to bring their accounting policies into
line with those used by the members of the Group.
All intra-group transactions, balance, income and expenses are
eliminated in full on consolidation.
The Group does not have any non-controlling interest during the
year.
(b) Segment reporting
For the purpose of IFRS 8 "Operating Segments" the Company
currently has one segment being "Investment sector". No further
operating segment financial information is therefore disclosed.
(c) Property, plant and equipment
Items of property, plant and equipment are measured at cost less
accumulated depreciation and any accumulated impairment losses.
Depreciation is charged so as to allocate the cost of assets
less their residual values over their estimated useful lives, using
the straight-line method. The following annual rates are used for
the depreciation of property, plant and equipment:
Furniture and fixture 20%
Office equipment 30%
If there is an indication that there has been a significant
change in the depreciation rate, useful life or residual value of
an asset, the depreciation of that asset is revised prospectively
to reflect the new expectations.
An asset's carrying amount is written down immediately to its
recoverable amount if the asset's carrying amount is greater than
its estimated recoverable amount.
(d) Cash and cash equivalents
Cash and cash equivalents include cash on hand and other
short-term highly liquid investments with original maturities of
three months or less. Bank overdraft is shown within borrowings in
current liabilities on the consolidated statement of financial
position.
(e) Financial instruments
Financial assets and financial liabilities are recognised when a
group entity becomes a party to the contractual provisions of the
instrument.
Financial assets and financial liabilities are initially
measured at fair value. Transaction costs that are directly
attributable to the acquisition or issue of financial assets and
financial liabilities (other than financial assets and financial
liabilities at fair value through profit or loss) are added to or
deducted from the fair value of the financial assets or financial
liabilities, as appropriate, on initial recognition. Transaction
costs directly attributable to the acquisition of financial assets
or financial liabilities at fair value through profit or loss are
recognised immediately in profit or loss.
Financial assets
Financial assets are classified into the following specified
categories: "available-for-sale" (AFS) financial assets and "loans
and receivables". The classification depends on the nature and
purpose of the financial assets and is determined at the time of
initial recognition. All regular way purchases or sales of
financial assets are recognised and derecognised on a trade date
basis. Regular way purchases or sales are purchases or sales of
financial assets that require delivery of assets within the time
frame established by regulation or convention in the
marketplace.
Effective interest method
The effective interest method is a method of calculating the
amortised cost of a debt instrument and of allocating interest
income over the relevant period. The effective interest rate is the
rate that exactly discounts estimated future cash receipts
(including all fees on points paid or received that form an
integral part of the effective interest rate, transaction costs and
other premiums or discounts) through the expected life of the debt
instrument, or, where appropriate, a shorter period to the net
carrying amount of initial recognition.
Income is recognised on an effective interest basis for
debt.
Available-for-sale financial assets ("AFS financial assets")
AFS financial assets are non-derivatives that are either
designated as available-for-sale or are not classified as (a) loans
and receivables, (b) held-to-maturity investments or (c) financial
assets at FVTPL.
AFS financial assets are measured at fair value at the end of
each reporting period. Changes in fair value are recognised in
other comprehensive income and accumulated under the heading of
available-for-sale investments revaluation reserve. Where the
financial asset is disposed of or is determined to be impaired, the
cumulative gain or loss previously accumulated in the
available-for-sale investments revaluation reserve is reclassified
to profit or loss (see the accounting policy in respect of
impairment loss on financial assets below).
Loans and receivables
Loans and receivables are non-derivative financial assets with
fixed or determinable payments that are not quoted in an active
market. Loans and receivables (including deposits and other
receivables, cash and cash equivalents) are measured at amortised
cost using the effective interest method, less any impairment.
Interest income is recognised by applying the effective interest
rate, except for short-term receivables when the recognition of
interest would be immaterial.
Impairment of financial assets
Financial assets are assessed for indicators of impairment at
the end of each reporting period. Financial assets are considered
to be impaired when there is objective evidence that, as a result
of one or more events that occurred after the initial recognition
of the financial asset, the estimated future cash flows of the
investment have been affected.
For AFS equity investments, a significant or prolonged decline
in the fair value of the security below its costs is considered to
be objective evidence of impairment.
For all other financial assets, objective evidence of impairment
could include:
-- significant financial difficulty of the issuer or counterparty; or
-- breach of contract, such as a default or delinquency in interest or principal payments; or
-- it becoming probable that the borrower will enter bankruptcy
or financial re-organisation; or
-- the disappearance of an active market for that financial
asset because of financial difficulties.
For financial assets carried at amortised cost, the amount of
the impairment loss recognised is the difference between the
asset's carrying amount and the present value of estimated future
cash flows, discounted at the financial asset's original effective
interest rate.
The carrying amount of the financial asset is reduced by the
impairment loss directly for all financial assets, where the
carrying amount is reduced through the use of an allowance account.
Changes in the carrying amount of the allowance account are
recognised in profit or loss.
For financial assets measured at amortised cost, if, in a
subsequent period, the amount of the impairment loss decreases and
the decrease can be related objectively to an event occurring after
the impairment was recognised, the previously recognised impairment
loss is reversed through profit or loss to the extent that the
carrying amount of the investment at the date the impairment is
revered does not exceed what the amortised cost would have been had
the impairment not been recognised.
When an AFS financial asset is considered to be impaired,
cumulative gains or losses previously recognised in other
comprehensive income are reclassified to profit or loss in the
period.
In respect of AFS equity investments, impairment losses
previously recognised in profit or loss are not reversed through
profit or loss. Any increase in fair value subsequent to an
impairment loss is recognised in other comprehensive income and
accumulated under the heading of available-for-sale investments
revaluation reserve. In respect of AFS debt investments, impairment
losses are subsequently reversed through profit or loss if an
increase in the fair value of the investment can be objectively
related to an event occurring after the recognition of the
impairment loss.
Financial liabilities and equity instruments
Debt and equity instruments issued by the Group are classified
as either financial liabilities or as equity in accordance with the
substance of the contractual arrangements and the definitions of a
financial liability and an equity instrument.
Equity instruments
An equity instrument is any contract that evidences a residual
interest in the assets of an entity after deducting all of its
liabilities. Equity instruments issued by the Group are recognised
at the proceeds received, net of direct issue costs.
Repurchase of the Company's own equity instruments is recognised
and deducted directly in equity. No gain or loss is recognised in
profit or loss on the purchase, sale, issue or cancellation of the
Company's own equity instruments.
Financial liabilities at fair value through profit or loss
("FVTPL")
Financial liabilities are classified as at FVTPL when the
financial liability is either held for trading or it is designated
as at FVTPL on initial recognition.
A financial liability is classified as held for trading if:
-- it has been acquired principally for the purpose of repurchasing in the near term; or
-- on initial recognition it is part of a portfolio of
identified financial instruments that the Group manages together
and has a recent actual pattern of short-term profit-taking; or
-- it is a derivative that is not designated and effective as a hedging instrument.
Financial liabilities at fair value through profit or loss
("FVTPL") (continued)
A financial liability other than a financial liability held for
trading may be designated as at FVTPL upon initial recognition
if:
-- such designation eliminates or significantly reduces a
measurement or recognition inconsistency that would otherwise
arise; or
-- the financial liability forms part of a group of financial
assets or financial liabilities or both, which is managed and its
performance is evaluated on a fair value basis, in accordance with
the Group's documented risk management or investment strategy, and
information about the grouping is provided internally on that
basis; or
-- it forms part of a contract containing one or more embedded
derivatives, and IAS 39 Financial Instruments: Recognition and
Measurement permits the entire combined contract (asset or
liability) to be designated as at FVTPL.
Financial liabilities at FVTPL are stated at fair value, with
any gains or losses arising on re-measurement recognised in profit
or loss. The net gain or loss recognised in profit or loss
incorporates any interest paid on the financial liability and is
included in the "other gain and losses" line item in the
consolidated income statement.
Other financial liabilities
Other financial liabilities (including other payables and
others) are subsequently measured at amortised cost using the
effective interest method.
Convertible loan designated at fair value through profit or
loss
The convertible loan includes a liability component and a
conversion option. The conversion option that will not be settled
by the exchange of a fixed amount of cash for a fixed number of the
Company's own equity instruments is treated as a derivative.
Derivatives embedded in a financial instrument are treated as
separate derivatives when their economic risks and characteristics
are not closely related to those of the host contract (the
liability component) and the host contract is not carried at fair
value through profit or loss.
The convertible loan (including the liability component and the
conversion option) as a whole is designated as a financial
liability at fair value through profit or loss on initial
recognition. In subsequent periods, the entire convertible loan is
measured at fair value, with changes in fair value recognised
directly in profit or loss in the period in which they arise.
Transaction costs that are directly attributable to the issue of
the convertible bond designated as financial liabilities at fair
value through profit or loss are recognised immediately in profit
or loss.
Effective interest method
The effective interest method is a method of calculating the
amortised cost of a financial liability and of allocating interest
expense over the relevant period. The effective interest rate is
the rate that exactly discounts estimated future cash payments
(including all fees and points paid or received that form an
integral part of the effective interest rate, transaction costs and
other premiums or discounts) through the expected life of the
financial liability, or, where appropriate, a shorter period to the
net carrying amount on initial recognition.
Interest expense is recognised on an effective interest basis
except for those financial liabilities designated at FVTPL.
Derecognition
The Group de-recognises a financial asset only when the
contractual rights to the cash flows from the asset expire, or when
it transfers the financial asset and substantially all the risks
and rewards of ownership of the asset to another entity. If the
Group neither transfers nor retains substantially all the risks and
rewards of ownership and continues to control the transferred
asset, the Group continues to recognise the asset to the extent of
its continuing involvement and recognises an associated liability.
If the Group retains substantially all the risks and rewards of
ownership of a transferred financial asset, the Group continues to
recognise the financial asset and also recognises a collateralised
borrowing for the proceeds received.
On de-recognition of a financial asset in its entirety, the
difference between the asset's carrying amount and the sum of the
consideration received and receivable and the cumulative gain or
loss that had been recognised in other comprehensive income and
accumulated in equity is recognised in profit or loss.
On de-recognition of a financial asset other than in its
entirety, the Group allocates the previous carrying amount of the
financial asset between the part it continues to recognise, and the
part it no longer recognises on the basis of the relative fair
values of those parts on the date of the transfer. The difference
between the carrying amount allocated to the part that is no longer
recognised and the sum of the consideration received for the part
no longer recognised and any cumulative gain or loss allocated to
it that had been recognised in other comprehensive income is
recognised in profit or loss. A cumulative gain or loss that had
been recognised in other comprehensive income is allocated between
the part that continues to be recognised and the part that is no
longer recognised on the basis of the relative fair values of those
parts.
The Group de-recognises financial liabilities when, and only
when, the Group's obligations are discharged, cancelled or they
expire. The difference between the carrying amount of the financial
liability derecognised and the consideration paid and payable is
recognised in profit or loss.
(f) Current assets and current liabilities
Current assets are expected to be realised within twelve months
of the date of the reporting period or in the normal course of the
Group's operating cycle. Current liabilities are expected to be
settled within twelve months of the date of the reporting period or
in the normal course of the Group's operating cycle.
(g) Foreign currency translation
(i) Functional and presentation currency
Items included in the financial statements of each of the group
entities are measured using the currency in accordance to the
location where shares of the Company are traded (the functional
currency). These consolidated financial statements are presented in
Great British Pound ("GBP"), which is the Company's functional and
the Group's presentation currency.
(ii) Transactions and balances
Foreign currency transactions are translated into the functional
currency using the exchange rates prevailing at the dates of the
transactions. Foreign exchange gains and losses resulting from the
settlement of such transactions and from the translation at
year-end exchange rates of monetary assets and liabilities
denominated in foreign currencies are recognised in profit or
loss.
(h) Revenue recognition
Revenue is recognised when it is probable that the economic
benefits will flow to the Group and the revenue and costs, if
applicable, can be measured reliably, the Group did not generate
any gain or loss on disposal of available-for-sale financial assets
the reporting period whereas interest income is recognised on a
time-proportion basis using the effective interest method.
(i) Provisions
Provisions are recognised when the Group has a present
obligation (legal or constructive) as a result of a past event, and
it is probable that the Group will be required to settle that
obligation, and reliable estimate can be made of the amount of the
obligation. Provisions are measured at the Group;s best estimate of
the expenditure required to settle the present obligation at the
end of the reporting period, and are discounted to present value
where the effect of the time value of money is material.
(j) Leasing
Leases are classified as finance leases whenever the terms of
the lease transfer substantially all the risks and rewards of
ownership to the lessee. All other leases are classified as
operating leases.
Rental payable under operating leases are recognised as an
expenses on a straight-line basis over the lease term, except where
another systematic basis is more representative of the time pattern
in which economic benefits from the leased asset are consumed.
(k) Share-based payment transactions
The fair value of services received determined by reference to
the fair value of share warrants and options granted under the
share warrants and share award scheme of the Company on the grant
date is expensed on the year of grant.
At the end of each reporting period, the Group revises its
estimates of the number of options that are expected to ultimately
vest. The impact of the revision of the estimates during the
vesting period, if any, is recognised in profit or loss such that
cumulative expenses reflects the revised estimate, with a
corresponding adjustment to equity. At the time when the share
options are exercised, forfeited after the vesting date or are
still not exercised at the expiry date, the amount previously
recognised will continue to be held in equity.
(l) Retirement benefit cost
Payments to retirement benefits plans and government-managed
retirement benefits schemes are recognised as an expense when
employees have rendered service entitling them to the
contributions.
(m) Taxation
Income tax expense represents the sum of the tax currently
payable and deferred tax.
The tax currently payable is based on taxable profit for the
year. Taxable profit differs from profit as reported in the
statement of income and retained earnings because of items of
income or expense that are taxable or deductible in other years and
items that are never taxable or deductible. The Group's liability
for current tax is calculated using tax rates that have been
enacted or substantively enacted by the end of the reporting
period.
Deferred tax is recognised on temporary differences between the
carrying amounts of assets and liabilities in the consolidated
financial statements and the corresponding tax bases using in the
computation of taxable profit. Deferred tax liabilities are
generally recognised for all taxable temporary differences.
Deferred tax assets are generally recognised for all deductible
temporary differences to the extent that is probable that taxable
profit will be available against which those deductible temporary
differences can be utilised. Such deferred tax assets and
liabilities are not recognised if the temporary difference arises
from goodwill or from the initial recognition (other than in
business combination) of other assets and liabilities in a
transaction that affects neither the taxable profit nor the
accounting profit.
The carrying amount of deferred tax assets is reviewed at the
reporting date and reduced to the extent that it is no longer
probable that sufficient taxable profits will be available to allow
all or part of the asset to be recovered.
Deferred tax assets and liabilities are measured at the tax
rates that are expected to apply in the period in which the
liability is settled or the asset realised, based on tax rates (and
tax laws) that have been enacted or substantively enacted at the
reporting date. The measurement of deferred tax liabilities and
assets reflects the tax consequences that would follow from the
manner in which the Group expects, at the reporting date, to
recover or settle the carrying amount of its assets and
liabilities. However, the measurement of deferred tax liabilities
associated with an investment property measured at fair value does
not exceed the amount of tax that would be payable on its sale to
an unrelated market participant at fair value at the reporting
date. Deferred tax is recognised in profit or loss, except when it
relates to items that are recognised in other comprehensive income
or directly in equity, in which case the deferred tax is also
recognised in other comprehensive income or directly in equity
respectively.
(n) Impairment of assets
Assets that have an indefinite useful life are not subject to
amortisation, which are at least tested annually for impairment and
are reviewed for impairment whenever events or changes in
circumstances indicate that the carrying amount may not be
recoverable. Assets that are subject to amortisation are reviewed
for impairment whenever events or changes in circumstances indicate
that the carrying amount may not be recoverable. An impairment loss
is recognised for the amount by which the asset's carrying amount
exceeds its recoverable amount. The recoverable amount is the
higher of an asset's fair value less costs to sell and value in
use. For the purposes of assessing impairment assets are grouped at
the lower levels for which there are separately identifiable cash
flow (cash-generating units).
(o) Contingent liabilities and contingent assets
A contingent liability is a possible obligation that arises from
past events and whose existence will only be confirmed by the
occurrence or non-occurrence of one or more uncertain future events
not wholly within the control of the Group. It can also be a
present obligation arising from past events that is not recognised
because it is not probable that outflow of economic resources will
be required or the amount of obligation cannot be measured
reliably. A contingent liability is not recognised but is disclosed
in the notes to the financial statements. When a change in the
probability of an outflow occurs so that outflow is probable, they
will then be recognised as a provision.
A contingent asset is a possible asset that arises from past
events and whose existence will be confirmed only by the occurrence
or non-occurrence of one or more uncertain future events not wholly
within control of the Group. A contingent asset is not recognised
but is disclosed in the notes to the financial statements when an
inflow of economic benefits is probable. When inflow is virtually
certain, an asset is recognised.
(p) Related parties
For the purpose of these financial statements, related party
includes a person and entity as defined below:
(a) A person or a close member of that person's family is
related to the Group if that person:
(i) has control or joint control over the Group;
(ii) has significant influence over the Group; or
(iii) is a member of the key management personnel of the Group or the Group's parent.
(b) An entity is related to the Group if any of the following
conditions applies:
(i) the entity and the Group are members of the same group
(which means that each parent, subsidiary and fellow subsidiary is
related to the others).
(ii) either entity is an associate or joint venture of the other
entity (or of a member of a group of which the other entity is a
member).
(iii) both entities are joint ventures of a third entity.
(iv) either 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 the Group or an entity related to the Group.
If the reporting entity is itself such a plan, the sponsoring
employers are also related to the plan.
(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 member if the key management personnel of the
entity (or of a parent of the entity).
(viii) Close members of the family of a person are those family
members who may be expected to influence or be influenced
management personnel of the entity (or of a parent of the
entity).
4. CRITICAL ACCOUNTING ESTIMATES AND JUDGMENTS
Estimates and judgments are continually evaluated and are based
on historical experience and other factors, including expectations
of future events that are believed to be reasonable under the
circumstances.
The Group makes estimates and assumptions concerning the future.
The resulting accounting estimates will, by definition, seldom
equal the related actual results. The estimates and assumptions
that have a significant risk of causing a material adjustment to
the carrying amounts of assets and liabilities within the next
financial year are discussed below.
Valuation of financial instruments
The Group uses valuation techniques that include inputs that are
not based on observable market data to estimate the fair value of
certain types of financial instruments. Notes 13 provide
information the estimation of the fair value of financial
instruments.
The directors of the Company believe that the chosen valuation
techniques used are appropriate in determining the fair value of
financial instruments.
5. OTHER INCOME
Other income represents the bank interest income and foreign
exchange gain incurred during the year, as presented below:
2016 2015
GBP GBP
Bank interest income 3 6
Foreign exchange gain 374 4,541
Sundry income - 1,554
---- -----
377 6,101
---- -----
6. LOSS BEFORE TAX
Loss before tax arrived at after charging/ (crediting):
2016 2015
GBP GBP
Auditors' remuneration 20,491 17,249
Depreciation of property, plant
and equipment 2,979 2,786
Foreign exchange loss 1,196 5,947
Operating lease payment in respect
of office premises 7,984 34,129
Staff costs (including directors'
remuneration)
- Fees 20,625 22,500
- Salaries and other benefits 73,410 140,411
- Retirement scheme contribution 2,901 2,981
- Reversal of share-based
payment - (135,926)
------ ----------
Total staff costs 96,936 29,966
------ ----------
7. DIRECTORS' REMUNERATION
During the year, no emoluments were paid by the Group to the
Directors as an inducement to join or upon joining the Group or as
compensation for loss of office.
For the year ended 31 December 2016:
Salaries Share- Retirement
and other based scheme
Fees benefits payment contribution Total
GBP GBP GBP GBP GBP
Executive directors
Mr. Robert Anthony Rowland
Berkeley - 11,430 - - 11,430
Mr. Wai Tak Jonathan
Chu - 6,843 - 342 7,185
Mr. Paniti Junhasavasdiku
(iii) - 26,133 - - 26,133
------ --------- ------- ------------ ------
- 44,406 - 342 44,748
------ --------- ------- ------------ ------
Independent non-executive
director
Mr. Seah Boon Chin 20,625 - - - 20,625
------ --------- ------- ------------ ------
20,625 44,406 - 342 65,373
------ --------- ------- ------------ ------
For the year ended 31 December 2015:
Salaries Share- Retirement
and other based scheme
Fee benefits payment contribution Total
GBP GBP GBP GBP GBP
Executive directors
Dr. Sri Hartati
Kurniawan
(i) - 74,536 (120,031) 886 (44,609)
Mr. Robert Anthony
Rowland Berkeley - 12,000 (15,895) - (3,895)
Mr. Wai Tak Jonathan
Chu - 7,088 - 454 7,542
Mr. Akekachat
Leelapanyalert
(ii) - 3,000 - - 3,000
---------------- ------------------------ ----------------- -------------- -----------------
- 96,624 (135,926) 1,340 (37,962)
---------------- ------------------------ ----------------- -------------- -----------------
Independent
non-executive
director
Mr. Seah Boon Chin 22,500 - - - 22,500
---------------- ------------------------ ----------------- -------------- -----------------
22,500 96,624 (135,926) 1,340 (15,462)
---------------- ------------------------ ----------------- -------------- -----------------
Notes:
(i) Dr. Sri Hartati Kurniawan resigned on 20 July 2015.
(ii) Mr. Akekachat Leelapanyalert was appointed on 1 August 2014
and resigned on 25 March 2015.
(iii) Mr.Paniti Junhasavasdiku was appointed on 9 September 2016.
8. INCOME TAX
2016 2015
---- ----
GBP GBP
Current income tax - -
---- ----
i) Pursuant to the rules and regulations of the BVI, the Company
is not subject to any income tax in the BVI.
ii) No provision for Hong Kong profits tax has been made for
subsidiary incorporated in Hong Kong as the subsidiary did not have
any assessable profits subject to Hong Kong profits tax during the
years ended 31 December 2016 and 2015.
Tax charge for the year is reconciled to loss before taxation as
follows:
2016 2015
----------- ----------
GBP GBP
Loss before taxation (4,351,433) (301,146)
----------- ----------
Tax at the application income tax rate (717,986) (49,689)
Tax effect of expenses not deductible 717,986 49,689
----------- ----------
Tax charge and effective tax rate for the year - -
----------- ----------
9. LOSS PER SHARE
The calculation of basic loss per share is based on the loss
attributable to owners of the Company and the weighted average
number of ordinary shares in issue during the year.
(a) Basic loss per share
During the year ended 31 December 2016, the calculation of basic
loss per share amount is based on the net loss for the year of
GBP4,351,433 (2015: GBP301,146) attributable to the equity holders
of the Company, and weighted average of 212,826,072 (2015:
211,853,195) ordinary shares in issued during the year.
(b) Diluted loss per share
No adjustment has been made to the basic loss per share
presented for the year ended 31 December 2016 and 2015 in respect
of a dilution as the impact of the convertible loan and share
options outstanding (2015: share options outstanding) had an
anti-dilutive effect on the basic loss per share presented.
10. DIVID
No dividend has been paid or declared by the Company during the
year ended 31 December 2016 (2015: nil).
11. PROPERTY, PLANT AND EQUIPMENT
Furniture Office
and fixture equipment Total
GBP GBP GBP
At cost:
At 1 January 2015 325 17,008 17,333
Additions 344 466 810
Exchange realignment 27 122 149
----------- --------- ------
At 31 December 2015
and 1 January 2016 696 17,596 18,292
Additions - - -
Exchange realignment 139 551 690
----------- --------- ------
At 31 December 2016 835 18,147 18,982
----------- --------- ------
Accumulated depreciation:
At 1 January 2015 101 2,430 2,531
Charge for the year 98 2,688 2,786
Exchange realignment 7 49 56
----------- --------- ------
At 31 December 2015
and 1 January 2016 206 5,167 5,373
Charge for the year 152 2,827 2,979
Exchange realignment 57 297 354
----------- --------- ------
At 31 December 2016 415 8,291 8,706
Net carrying value:
At 31 December 2016 420 9,856 10,276
----------- --------- ------
At 31 December 2015 490 12,429 12,919
----------- --------- ------
12. SUBSIDIARIES
Particulars of the subsidiaries of the Company are as
follows:
Name of subsidiaries Place of incorporation Issued/Paid-up Effective interest Principal
share/registered held by the Company activities
capital
Direct Indirect
All Asia Asset Energy British Virgin Ordinary Investment
Limited Islands Share US$1 100% - holding
Administrative
All Asia Assets Ordinary supporting
(Hong Kong) Limited Hong Kong Shares 100% - services
HK$100
Energy Central Limited British Virgin Ordinary - 100% Investment
Share holding
Islands US$1
Fortune House Group British Virgin Ordinary - 100% Investment
Limited Share holding
Islands US$1
13. AVAILABLE-FOR-SALE FINANCIAL ASSETS
Available-for-sale financial assets comprise of:
2016 2015
GBP GBP
Unlisted equity securities,
at cost 4,702,021 4,702,021
Add: fair value adjustment (3,988,251) 180,779
exchange realignment 1,702,566 607,637
----------- ---------
2,416,336 5,490,437
----------- ---------
The unlisted equity securities are measured at fair value and
are classified as Level 3 fair value measurement. Fair value is
estimated using Discounted Cash Flow ("DCF") method. Details of
which the model's parameters adopted were shown in corresponding
note to each category of available-for-sale financial assets.
The details of movement in available-for-sale financial assets
have been set out as follow:
Place of Fair value Exchange At fair
Incorporation At cost adjustment difference value
GBP GBP GBP GBP
Andaman Power
and Utility Co.,
Limited (a) Thailand 3,462,095 (3,883,191) 1,249,230 828,134
Myanmar Allure
Group Company
Limited (b) Myanmar 1,239,926 (105,060) 453,336 1,588,202
--------- ----------- ---------- ---------
4,702,021 (3,988,251) 1,702,566 2,416,336
--------- ----------- ---------- ---------
As at 31 December 2015
Place of Fair value Exchange At fair
Incorporation At cost adjustment difference value
GBP GBP GBP GBP
Andaman Power
and Utility
Co.,
Limited (a) Thailand 3,462,095 (1,720) 464,744 3,925,119
Myanmar Allure
Group Company
Limited (b) Myanmar 1,239,926 182,499 142,893 1,565,318
--------- ---------- ---------- ---------
4,702,021 180,779 607,637 5,490,437
--------- ---------- ---------- ---------
Notes:
(a) As at 31 December 2016, the Group owns 7% interest of
Andaman Power and Utility Co., Limited ("APU"). APU has obtained
the rights to develop and operate a 500MW combined-cycle power
plant construction project in Shan Province of Myanmar. In the
opinion of the directors, the Group has not been in a position to
exercise any significant influence over the financial and operating
policies of APU. Accordingly, APU has been accounted for as an
available-for-sale financial asset.
As at 31 December 2016, the fair value of approximately
US$1,022,000 (equivalent to GBP828,134) (2015: US$5,810,000
(equivalent to GBP3,925,119) was derived by an independent
professional valuer using a DCF method. In determining the fair
value, a risk-adjusted discount rate of 31.74% was being used.
Subsequent to the end of the reporting period, on 3 May 2017,
the Group disposed all interests in APU through a disposal of the
entire issued capital of Energy Central Limited for a consideration
of Thai Baht 34,889,000 settled in cash.
(b) As at 31 December 2016, the Group owns 7% equity interest of
Myanmar Allure Group Company Limited ("MAG"). MAG, a private
company with limited liability, owns and operates a resort hotel in
Tachileik, Shan Province of Myanmar. In the opinion of the
directors, the Group has not been in a position to exercise any
significant influence over the financial and operating policies of
MAG. Accordingly, MAG has been accounted for as an
available-for-sale financial asset.
As at 31 December 2016, a fair value of approximately
US$1,960,000 (equivalent to GBP1,588,202) (2015: US$2,317,000
(equivalent to GBP1,565,318) was derived by an independent
professional valuer using a DCF method. In determining the fair
value, a risk-adjusted discount rate of 32.22% was being used.
14. CASH AND BANK BALANCE
2016 2015
------ -------
GBP GBP
Cash and bank
balance 44,648 186,783
------ -------
At 31 December 2016, bank balances carry interest at market rate
of 0.05% (2015: 0.05%) per annum. The bank balances are deposited
with creditworthy banks of high credit rating.
15. SHARE CAPITAL
Number of
ordinary shares
of GBP0.10each GBP
Authorised
At 31 December 2015 and 2016 1,000,000,000 N/A
--------------- ---------
Issued
As at 1 January 2015 209,861,072 5,794,969
Issue of shares under subscription
of share(i) 2,000,000 330,000
Issue of shares under subscription
of share(ii) 965,000 159,225
--------------- ---------
At 31 December 2015, 1 January
2016 and 31 December 2016 212,826,072 6,284,194
--------------- ---------
Notes:
(i) On 7 May 2015, 2,000,000 ordinary shares of 16.5 pence each
in the Company were issued at subscription price of 16.5 pence per
share by subscription of share. The net proceeds of GBP330,000 was
intended to fund further investment opportunities of the Group and
general working capital of the Group.
(ii) On 27 May 2015, 965,000 ordinary shares of 16.5 pence each
in the Company were issued at subscription price of 16.5 pence
share by subscription of share. The net proceeds of GBP159,225 was
intended to fund further investment opportunities of the Group and
general working capital of the Group.
All the shares issued were ranked pari passu in all respects
with the existing ordinary shares of the Company.
16. WARRANTS AND SHARE APPRECIATION AWARDS
The Group has issued or generated one-off warrants and share
appreciation awards (the "Awards") to the executive directors of
the Company during the Reporting Period.
Warrants
On 25 April 2013, the Company has issued one-off warrants to the
executive directors of the Company which given the right to
subscribe for new Ordinary Shares of the Company at 3 pence per
ordinary share and are exercisable 2 years after the date of grant
and will lapse if not exercised within 5 years from the date of
grant. There are no performance conditions that are required to be
satisfied in order for the Warrants to become exercisable.
2016 2015
Weighted Weighted
average average
exercise exercise
price price
No. of per share No. of per share
share (pence) share (pence)
Outstanding at 1 January 4,176,082 3 12,528,247 3
Lapsed during the year - - (8,352,165) 3
--------------------------- --------- --------- ----------- ---------
Outstanding at 31 December 4,176,082 3 4,176,082 3
--------------------------- --------- --------- ----------- ---------
Exercisable at 31 December 4,176,082 - 4,176,082 -
--------------------------- --------- --------- ----------- ---------
The exercisable period of warrants of the Company are as
follows:
2016 2015
Weighted Weighted
average average
exercise exercise
price price
per share per share
No. of (pence) No. of (pence)
24 April 2015 - 24 April
2018 4,176,082 3 4,176,082 3
--------- --------- --------- ---------
The fair value of the warrants is initially recognised on the
grant date was GBP133,839. The fair value was estimated by the
directors with reference to a valuation report issued by an
independent valuer the Black-Scholes option pricing model by
Bloomberg and taking into account the terms and conditions upon
which the warrants granted.
On 20 July 2015, one of the executive directors, Dr. Sri Hartati
Kurniawan resigned from her office and the 8,352,165 of warrants
granted to her lapsed accordingly.
Share Appreciation Awards
On 25 April 2013, the Company issued one-off share appreciation
awards ("the Awards") to the executive directors which are spilt
into five tranches with different exercise timeframe. The Awards
are given the rights to receive the new Ordinary Shares of the
Company based on the performance of the Company which are measured
by the share price of the Company of each tranche. The Awards will
become exercisable in respect of that number of Ordinary Shares
subject to the relevant tranche and the Awards are exercisable for
two years from the date upon which the relevant performance
condition is satisfied and are not exercisable during the close
period. Where a Performance Condition is not satisfied within the
relevant measurement period, the relevant tranche shall lapse and
not carry over. The Company does not intend to grant further share
appreciation awards.
2016 2015
Outstanding at 1 January 1,789,749 26,846,240
Lapsed during the year - (25,056,491)
--------- ------------
Outstanding as at 31 December 1,789,749 1,789,749
--------- ------------
Exercisable as at 31 December - -
--------- ------------
The performance condition and exercise period of share awards
are as follow:
Share price Measurement period
------------ ------------------------------
22.8 pence Any 12 month period before 31
December 2017
The fair value of the Awards is initially recognised on the
grant date was GBP66,218. The fair value was estimated by the
directors with reference to a valuation report issued by an
independent valuer using Black-Scholes option pricing model and
taking into account the terms and conditions upon which the
warrants granted.
On 20 July 2015, one of the executive directors, Dr. Sri Hartati
Kurniawan resigned from her office and the 8,352,165 of Awards
granted to her lapsed accordingly.
17. RESERVES
Fair Share
value option Exchange Accumulated
reserve reserve reserve loss Total
GBP GBP GBP GBP GBP
At 1 January 2015 147,675 180,051 345,234 (1,130,337) (457,377)
Loss for the period - - - (301,146) (301,146)
Other comprehensive
income:
Fair value change
on available for-sale
financial assets 33,104 - - - 33,104
Exchange difference
on
translating financial
statements of
overseas subsidiaries - - 255,870 - 255,870
----------- ---------- ------------- ------------------- ------------------
Total comprehensive
income for the
year 33,104 - 255,870 (301,146) (12,172)
Lapse of share
options - (135,926) - - (135,926)
----------- ---------- ------------- ------------------- ------------------
At 31 December
2015 and 1 January
2016 180,779 44,125 601,104 (1,431,483) (605,475)
----------- ---------- ------------- ------------------- ------------------
Loss for the year - - - (4,351,433) (4,351,433)
Other comprehensive
income:
Fair value change
on available-for-sale
financial assets (4,169,030) - - - (4,169,030)
Exchange difference
on translating
financial statements
of overseas subsidiaries - - 1,086,291 - 1,086,291
Reclassification
adjustment relating
to impairments
of available-for-sale
investment during
the year 3,881,471 3,881,471
----------- ---------- ------------- ------------------- ------------------
Total comprehensive
income for the
year (287,559) - 1,086,291 (4,351,433) (3,552,701)
Lapse of share
options - - - - -
----------- ---------- ------------- ------------------- ------------------
As at 31 December
2016 (106,780) 44,125 1,687,395 (5,782,916) (4,158,176)
----------- ---------- ------------- ------------------- ------------------
Nature and purpose of the reserves
(i) Fair Value reserve
The fair value reserve comprises the change in fair value of
available-for-sale financial assets as at the end of each reporting
period. The amount will be reclassified to profit or loss as
realised gain on disposal of available-for-sale financial assets
when the available-for-sale financial assets have been
disposed.
(ii) Share options reserve
Share options reserve comprises the fair value of warrants and
the Awards granted which are yet to be exercised, the amount will
transferred to share capital account when the related warrants and
Awards are exercised or to retained profits should the related
warrants and Awards expire or be forfeited.
(iii) Exchange reserve
The exchange fluctuation reserve comprises all foreign exchange
difference arising from translation of financial statements of the
overseas subsidiaries.
18. OTHER PAYABLES AND ACCRUALS
2016 2015
GBP GBP
Accruals expenses 33,931 16,250
------ ------
19. OPERATING LEASES ARRANGEMENT
The Group leases certain of its office property under operating
lease arrangements. Leases for properties are negotiated for terms
ranging from one to two years.
As at the year ended of 31 December 2016, the Group had the
following total future minimum lease payments payable under
non-cancellable operating lease:
2016 2015
GBP GBP
Not later than one year - 9,548
Later than one year - -
---- -----
- 9,548
---- -----
20. CONVERTIBLE LOAN
The Company issued a two years convertible bond with principal
amount of GBP100,000, bearing interest rate at 15% per annum, to
Nature Cove Holdings Limited ("Nature Cove") on 1 December 2016.
The convertible loan entitled Nature Cove to convert them into
ordinary shares of the Company at any time between the date of
issue of the convertible loan and the date of maturity on 1
December 2018 at the lower of conversion price of GBP 0.03 per
ordinary share or the market price. If the convertible loan has not
been converted, they will be redeemed on 1 December 2018 at the
principal amount outstanding plus accrued interest.
The convertible loan contains a liability component and a
conversion option derivative. The convertible loan was designated
at fair value through profit or loss entirely and measured at fair
value with changes in fair value recognised in profit or loss.
The movements of the convertible loan notes are set out
below:
Total
GBP
At 1 January 2016 -
Issued during the year 100,000
Change in fair value 220,243
At 31 December 2016 320,243
-------
The following assumptions were used to calculate the fair values
of the embedded derivatives:
Valuation date 2016
Spot price GBP0.095
Conversion price GBP0.030
Time to maturity 1.9 year
Risk-free rate 0.0844%
Volatility 81%
The monte carlo simulation model has been used to estimate the
fair value of the embedded derivatives. The variables and
assumptions used in computing the fair value of the embedded
derivatives are based on the directors' best estimate. Changes in
variables and assumptions may result in changes in the fair value
of the embedded derivatives.
21. RELATED PARTY TRANSACTIONS
Compensation of key management personnel of the Group
2016 2015
GBP GBP
Short term employee benefits 65,031 119,124
Past-employment benefit 342 1,340
Equity-settled share option expenses - (135,926)
------ --------------
65,373 (15,462)
------ --------------
22. CAPITAL RISK MANGEMENT
The Group manages its capital to that entities in the Group will
be able to continue a going concern while maximising the return to
shareholders through the optimisation of the debt and equity
balance.
The capital structure of the Group consists of cash and cash
equivalents and equity attributable to shareholders of the Company,
comprising issued share capital and reserves.
The directors of the Company review the capital structure by
considering the cost of capital and the risks associated with
capital. In view of this, the Group will balance its overall
capital structure through new shares issues as well as issue of new
debt.
23. FINANCIAL RISK MANAGEMENT OBJECTIVE AND POLICIES
The Group's major financial instruments include equity
investment, other payables and bank and cash balances. Detail
instruments are disclosed in the respective notes. The risks
associated with these financial instruments and the policies
applied by the Group to mitigate these risks are set out below.
Management monitors these exposures to ensure appropriate measures
are implemented in a timely and effective manner.
Foreign currency risk
The Group has no significant assets and liabilities which
denominated in the currency other than functional currency of the
group entities. The Group currently does not have a foreign
currency hedging policy. However, the management monitors foreign
exchange exposure and will consider hedging significant currency
exposure should the need arises. Accordingly, no sensitivity
analysis presented.
Interest rate risk
The Group's cash flow interest rate risk is mainly concentrated
on the bank balances carried at floating interest rate. The Group
currently does not have a hedge policy against the interest rate
exposure. However, the management monitors interest rate exposure
and will consider the hedging significant interest rate exposure as
needed.
The directors consider that the Group's exposure to interest
rate risk of bank balances, which are short term in nature, is
insignificant, accordingly no sensitivity analysis is
presented.
Credit risk
The Group's maximum exposure to credit risk is represented by
total financial assets held by the Group. The Group does not hold
any collateral during the reporting period.
Cash and bank deposits are placed with financial institutions
with sound credit ratings and the directors of the Company do not
expect any counterparty failing to meet its obligation.
The Group does not provide any financial guarantees which would
expose the Group to credit risk.
Liquidity risk
Liquidity risk is the risk that the Group are unable to meet
their payment obligations associated with its financial liabilities
when they fall due. The Group manages liquidity risk by maintaining
adequate reserves, as well as continuously monitoring cash flow
forecast and actual cash flows.
In managing the liquidity risk, the Group monitors and maintains
a level of cash and cash equivalents that is adequate in discretion
of the directors of the Company. In formulating their strategy, the
directors of the Company would consider the financing of the
Group's operations and the effects of fluctuation in operating and
investing cash flows. As at 31 December 2016, the liquidity of the
Group is primarily dependent on its ability to maintain adequate
cash flows from operations and to raise funds through issue of
convertible loans to meet its obligations and investment project
opportunities as they fall due or arise.
The maturity profile of the Group's financial liabilities as at
the end of the year is as follows:
Weighted
average
effective - Total
interest Less than More than undiscounted carrying
rate 1 year 1 year cash flows amount
--------- --------- --------- ------------ --------
% GBP GBP GBP GBP
At 31 December 2016
Accruals and other
payables N/A 33,931 - 33,931 33,931
Convertible loan 15% 15,000 100,000 115,000 320,243
--------- --------- ------------ --------
48,931 100,000 148,931 354,174
--------- --------- ------------ --------
At 31 December 2015
Accruals and other
payables N/A 16,250 - - 16,250
--------- --------- --------- ------------ --------
Fair values on financial instruments
(i) Financial instruments carried at fair value on a recurring basis
The following table presents the carrying amount of financial
instruments measured at fair value at 31 December 2016 across the
three levels of the fair value hierarchy defined in IFRS 13 Fair
Value Measurements, with the fair value of each financial
instrument categorised in its entirely based on the lowest level of
input that is significant to the fair value measurement. The levels
are defined as follows:
- Level 1 (highest level): fair value measurements are those
derived from quoted price (unadjusted) in active markets for
identical asset or liabilities;
- Level 2: fair value measurements are those derived from inputs
other than quoted prices included within Level 1 that are
observable for asset or liability, either directly (i.e. as prices)
or indirectly (i.e. derived from prices); and
- Level 3 (lowest level): fair value measures are those derived
from valuation techniques that include inputs for assets or
liability that are not based on observable market data
(unobservable inputs).
As at 31 December 2016, the Group had following financial
instrument carried at fair value all of which are based on the
level 3.
2016 2015
--------- ---------
GBP GBP
Financial assets:
Available-for-sale financial assets 2,416,336 5,490,437
--------- ---------
Financial liabilities
Convertible loan 320,243 -
--------- ---------
(i) Financial instruments carried at fair value on a recurring basis (continued)
Level 3 movement tables
For the year ended 31 December 2016
Available-
for-sale
financial Convertible
asset loan Total
----------- ----------- -----------
GBP GBP GBP
At the beginning of the year 5,490,437 - 5,490,437
Total gains or losses
in profit or loss (3,881,471) (220,243) (4,101,714)
in other comprehensive income (287,559) - (287,559)
Issue (100,000) (100,000)
Exchange realignment 1,094,929 1,094,929
----------- ----------- -----------
At the end of the year 2,416,336 (320,243) 2,096,093
----------- ----------- -----------
For the year ended 31 December 2015
Available-
for-sale
financial
asset
----------
GBP
At the beginning of the year 5,200,876
Total gains or losses
in profit or loss -
in other comprehensive income 33,104
Purchase -
Exchange realignment 256,457
----------
At the end of the year 5,490,437
----------
(i) Financial instruments carried at fair value on a recurring basis (continued)
The following table gives information about how the fair values
of the Group's available-for-sale financial assets are determined
(in particular, the valuation technique(s) and inputs used).
2016 2015 Valuation Significant Range Relationship
technique(s) unobservable of unobservable
inputs inputs to
fair value
GBP GBP
Financial
assets
The higher
the free cash
Available-for-sale flow, the
financial Discounted Free cash higher the
assets 2,416,336 5,490,437 cash flow flow N/A fair value
Discount The higher
rate the discount
rate, the
31.74% lower the
to 31.22% fair value
Discount 11.73% The higher
for lack to 15.03% the discount
of marketability for lack of
marketability,
the lower
fair value
Financial
liabilities
Monte
Carlo The higher
simulation the volatility,
Convertible pricing the higher
loan 320,243 - model Volatility 81% the fair value
(ii) Fair Value of Financial instruments carried at other than fair value
The carrying amounts of the Group's financial instruments
carried at cost or amortised cost are not materially different from
their fair value as at 31 December 2016 and 2015 due to their
short-term maturities.
2016
Carrying
amount Fair value
---------------------- ------------------------
GBP GBP
Bank and cash balances 44,648 44,648
Deposits 8,932 8,932
Accruals and other payable (33,931) (33,931)
---------------------- ------------------------
2015
Carrying
amount Fair value
--------------------------- ---------------------------
GBP GBP
Bank and cash balances 186,783 186,783
Deposits 4,830 4,830
Accruals and other payable (16,250) (16,250)
--------------------------- ---------------------------
Estimation of fair value
Fair value for unquoted equity investments are estimated using
the discount cash flow valuation techniques.
Classification and fair value of financial assets and
liabilities
The carrying amounts of each of the categories of financial
instruments are as at the end of the reporting period are as
follows:
2016 2015
GBP GBP
Financial assets
Available-for-sales financial assets 2,416,336 5,490,437
Loan and receivables 2,683 2,683
--------- ---------
2,419,019 5,493,120
--------- ---------
Financial liabilities
Amortised cost 33,931 16,250
Designated at FVTPL 223,708 -
257,528 16,250
--------- ---------
24. SUBSEQUENT EVENT
On 6 February 2017, the Board received an initial approach
regarding the purchase of 100% of the issued share capital of AAA's
subsidiary, Energy Central Limited ("Energy Central"), for a cash
consideration of Thai Baht 34,889,000, which is equivalent of
approximately GBP0.8m. Energy Central's sole asset was the
Company's interest in APU. The Company entered into a conditional
sale and purchase agreement with Chakris Kajkumjohndej (the
"Purchaser") for the disposal of Energy Central (the "Disposal").
Following the approval of the Disposal by shareholders, the
Disposal was completed and full payment has been received.
On 21 April 2017 the Company announced that Mr. Paniti
Junhasavasdikul has tendered his resignation and his resignation
become effective on 30 April 2017.
25. AUTHORISATION FOR ISSUE OF CONSOLIDATED FINANCIAL STATEMENTS
The consolidated financial statements were approved and
authorised for issue by the board of directors on 28 June 2017.
------ Ends ------
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR UWSURBSANUAR
(END) Dow Jones Newswires
June 28, 2017 09:06 ET (13:06 GMT)
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