TIDMSIHL
RNS Number : 5793N
Symphony International Holdings Ltd
26 September 2023
Not for Distribution, directly or indirectly, in or into the
United States or any jurisdiction in which such distribution would
be unlawful.
26 September 2023
Symphony International Holdings Limited
Interim Financial Results for the six-month period ended 30 June
2023
Symphony International Holdings Limited ("SIHL", the "Company"
or "Symphony") announces the interim results for the six months
ended 30 June 2023 . The condensed interim financial statements of
the Company and its subsidiaries have been prepared in accordance
with IAS 34 Interim Financial Reporting and have not been audited
or reviewed by the auditors of the Company.
Introduction
The Company is an investment company initially incorporated as a
limited liability company under the laws of the British Virgin
Islands on 5 January 2004. The Company voluntarily re-registered
itself as a BVI Business Company on 17 November 2006. The Company's
investment objectives are to increase the aggregate net asset value
of the Company ("NAV") calculated in accordance with the Company's
policies through strategic longer-term investments in
consumer-related businesses, primarily in the healthcare,
hospitality, lifestyle (including branded real estate
developments), logistics and education sectors, and through
investments in special situations and structured transactions,
which have the potential to generate attractive returns and to
enhance the NAV.
The Company was admitted to the Official List of the UK Listing
Authority on 3 August 2007 under Chapter 14 of the UK Listing Rules
and its securities were admitted to trading on the London Stock
Exchange's main market for listed securities on the same date.
Symphony's Investment Manager is Symphony Asia Holdings Pte.
Ltd. (the "Investment Manager" or "SAHPL"). The Company has entered
into an Investment Management Agreement with the Investment
Manager. SAHPL's licence for carrying on fund management in
Singapore is restricted to serving only accredited investors and/or
institutional investors. Symphony is an accredited investor.
As at 30 June 2023 , the issued share capital of the Company was
US$409.70 million (31 December 2022 : US$ 409.70 million)
consisting of 513,366,198 (31 December 2022 : 513,366,198) ordinary
shares.
Net Asset Value
Symphony's NAV is the sum of its cash and cash equivalents,
temporary investments, the fair value of unrealised investments
(including investments in subsidiaries, associates and joint
ventures) and any other assets, less any other liabilities. The
unaudited financial statements contained herein may not account for
the fair value of certain unrealised investments. Accordingly,
Symphony's NAV may not be comparable to the net asset value in the
unaudited financial statements. The primary measure of SIHL's
financial performance and the performance of its subsidiaries will
be the change in Symphony's NAV per share resulting from changes in
the fair value of investments.
The NAV attributable to the ordinary shares on 30 June 2023 was
US$0.79 (30 June 2022 : US$0.94) per share. This represented a
18.74% decrease over the NAV per share of US$0.97 at 31 December
2022. The change in NAV from 31 December 2022 to 30 June 2023 is
due to (i) a decrease in the value of an unlisted investment in the
logistics sector due to a slowdown in global trade and (ii)
dividends payable following a dividend announcement on 29 June
2023, which were
partially offset by other movements in the value of investments
and proceeds received from partial realisations and dividends.
Portfolio Overview
The following is an overview of the Company's portfolio as at 30
June 2023 :
HOSPITALITY
Minor International Public Company Limited ("MINT") is a global
company focused on three core businesses: hospitality, restaurants
and lifestyle brands distribution. MINT is a hotel owner, operator
and investor with a portfolio of over 530 hotels under the
Anantara, Avani, Oaks, Tivoli, NH Collection, NH, nhow, Elewana,
Marriott, Four Seasons, St. Regis and Radisson Blu brands in 55
countries across Asia Pacific, the Middle East, Africa, the Indian
Ocean, Europe, South and North America. MINT is also one of Asia's
largest restaurant companies with over 2,500 outlets system-wide in
23 countries under The Pizza Company, The Coffee Club, Riverside,
Benihana, Thai Express, Bonchon, Swensen's, Sizzler, Dairy Queen,
Burger King, Coffee Journey and GAGA brands. MINT is one of
Thailand's largest distributors of lifestyle brands and contract
manufacturers. Its brands include Anello, BergHOFF, Bossini,
Charles & Keith, Joseph Joseph, Zwilling J.A. Henckels and
Minor Smart Kids.
As at 30 June 2023 , the Company's gross cost in MINT was
approximately US$82.82 million (31 December 2022 : US$82.82
million). The net cost on the same date, after deducting partial
realisations and dividends received was (US$243.37 million) (31
December 2022 : (US$234.50 million)). The negative net investment
cost is due to the proceeds from partial realisations and dividends
being in excess of cost for this investment.
As at 30 June 2023 , the market value of the Company's
investment in MINT was US$59.46 million (31 December 2022 :
US$65.67 million) . The change in value since 31 December 2022 is
due to (i) the sale of 6.30 million shares and 9.99 million
warrants that cumulatively generated net proceeds of US$8.86
million and (ii) a depreciation in the onshore Thai baht rate by
2.46%, which was partially offset by an increase in the share price
of MINT by 6.20% during the same period.
HEALTHCARE
ASG Hospital Private Limited ("ASG") is a full-service
eye-healthcare provider with operations in India, Africa, and
Nepal. ASG was co-founded in Rajasthan, India in 2005 by Dr. Arun
Singhvi and Dr. Shilpi Gang. ASG's operations have since grown to
145 clinics, which offer a full range of eye-healthcare services,
including outpatient consultation and a full suite of inpatient
procedures (cataract, retina surgeries, Lasik, glaucoma, cornea and
other complicated eye surgeries). ASG also operates an optical and
pharmacy business, which is located within clinics. Symphony
invested in ASG in tranches from October 2019 through to July 2020
and subsequently acquired secondary shares in October 2021. In
2022, Symphony sold approximately a third of its shares at 2.4
times its cost of shares sold. Symphony held an 8.62% interest in
ASG as at 30 June 2023.
Symphony's gross and net investment cost in ASG was US$20.67
million and US$3.65 million at 30 June 2023 (31 December 2022:
US$20.67 million and US$3.65 million), respectively. The fair value
of Symphony's investment at 30 June 2023 was US$31.04 million (31
December 2022: US$28.33 million). The difference in value is due to
changes in certain assumptions used in the valuation for this
investment.
Soothe Healthcare Pvt. Ltd. ("Soothe") was founded in 2012 and
operates within the fast-growing consumer healthcare products
market segment in India. With growing disposable income, the demand
for consumer healthcare products is expected to grow rapidly over
the coming decades. Soothe's core product portfolio includes
feminine hygiene and diaper products. Symphony completed an initial
equity investment in Soothe in August 2019 and subsequently made
investments through convertible notes and securities from 2020 to
2023.
Symphony's gross and net investment cost in Soothe was US$13.42
million at 30 June 2023 (31 December 2022: US$12.75 million).
During the six-month period ended 30 June 2023, Symphony subscribed
to new securities at a cost of US$0.67 million, which formed part
of a larger capital raising. The fair value of Symphony's
investment at 30 June 2023 was US$19.54 million, which compares to
US$23.38 million at 31 December 2022. The difference in value is
due to changes in certain assumptions used in the valuation for
this investment.
LIFESTYLE
The Liaigre Group ("Liaigre") was founded in 1985 in Paris and
is a brand synonymous with discreet luxury, and has become one of
the most sought-after luxury furniture brands, renowned for its
minimalistic design style. Liaigre has a strong intellectual
property portfolio and provides a range of bespoke furniture,
lighting, fabric & leather, and accessories. In addition to
operating a network of 24 showrooms across Europe, the US and Asia,
Liaigre undertakes exclusive interior architecture projects for
select yachts, hotels, and restaurants and private residences.
Symphony's gross investment cost in Liaigre was US$79.68 million
at 30 June 2023 (31 December 2022: US$79.68 million). The net cost
on the same date, after deducting partial realisations, was
US$67.63 million (31 December 2022: US$67.63 million). The fair
value of Symphony's investment at 30 June 2023 was US$43.5 million
(31 December 2022: US$41.86 million). The change in fair value from
31 December 2022 is due to a decrease in trailing earnings before
interest, tax, depreciation and amortisation ("EBITDA") , which was
more than offset by an increase in comparable company multiples
used to value the business.
CHANINTR ("Chanintr") Chanintr is a luxury lifestyle company,
based in Thailand, which primarily distributes high-end U.S. and
European furniture and household accessory brands, including
Liaigre, Barbara Barry, Baker, Herman Miller, Marquee, Minotti,
Bulthaup kitchens amongst others. Chanintr also provides Furniture,
Fixtures & Equipment solutions for real estate and hotel
projects. In 2019, Chanintr launched a new program called Chanintr
Residences which will showcase custom-designed luxury residences as
turnkey projects.
Wine Connection Group ("WCG") is Southeast Asia's leading wine
themed Food and Beverage chain with outlets in Singapore and
Thailand. Founded in 1998, WCG has developed an expertise in
offering affordable, high quality and exclusive wines from around
the world through owned F&B outlets. Symphony invested in WCG
in 2014.
The sale of this business has been completed and work is ongoing
to determine whether conditions for incremental contingent sale
proceeds have been met.
LIFESTYLE/REAL ESTATE
Minuet Ltd ("Minuet") is a joint venture between the Company and
an established Thai partner. The Company has a direct 49% interest
in the venture and is considering several development and/or sale
options for the land owned by Minuet, which is located in close
proximity to central Bangkok, Thailand. As at 30 June 2023, Minuet
held approximately 186.75 rai (29.88 hectares) of land in Bangkok,
Thailand.
The Company initially invested approximately US$78.30 million by
way of an equity investment and interest-bearing shareholder loans.
Since the initial investment by the Company, Minuet has received
proceeds from rental income and partial land sales. As at 30 June
2023, the Company's investment cost (net of shareholder loan
repayments) was approximately US$13.13 million (31 December 2022:
US$13.13 million). The fair value of the Company's interest in
Minuet on the same date was US$59.94 million (31 December 2022:
US$61.09 million) based on an independent third-party valuation of
the land plus the net value of the other assets and liabilities of
Minuet. The change in value of Symphony's interest is predominantly
due to a depreciation in the offshore Thai baht rate by 1.96%.
SG Land Co. Ltd. ("SG Land") is a joint venture company that
owns the leasehold rights for two office buildings in downtown
Bangkok - SG Tower and Millennia Tower. The properties deliver an
attractive yield and the related leases are set to expire between
October 2023 to November 2025. The Company holds a 49.9% interest
in the venture.
Niseko Property Joint Venture ("Niseko JV") is a property
development venture that acquired land in Niseko, Hokkaido, Japan.
Symphony has a 37.5% interest in this venture, which it acquired
for a total investment of US$10.2 million and has to date received
distributions of US$16.7 million that relate to the partial sale of
land held by the venture. The Niseko JV sold 31% of the development
site to Hanwha Hotels & Resorts with a further 39% to a new
joint venture company that is equally held and being co-developed
by the Niseko JV and Hanwha Hotels & Resorts. The Niseko JV
continues to effectively hold approximately 50% of the development
site, of which one third is held for future development and/or
sale.
Desaru property joint venture in Malaysia ("Desaru") is a
property joint venture in Malaysia with an affiliate of Destination
Resorts and Hotels Sdn Bhd, a hotel and destination resort
investment subsidiary of Khazanah Nasional Berhad, the investment
arm of the Government of Malaysia. The joint venture has developed
a beachfront resort with private villas for sale on the
south-eastern coast of Malaysia and that are branded and managed by
One&Only Resorts ("O&O"). The hotel operations were
officially launched in September 2020. The Company has a 49% equity
interest in the joint venture.
Symphony invested approximately US$58.78 million in the joint
venture at 30 June 2023 (31 December 2022: US$58.78 million). The
fair value for this investment on the same date was US$27.54
million based on a discounted cashflow model and independent
third-party valuation of the land. This compares to US$30.50
million at 31 December 2022. The difference in value is due to
changes in certain assumptions used in the valuation for this
investment.
Isprava Vesta Private Limited ("Isprava") is a company that
designs, builds and sells branded villas in non-urban markets in
India such as Alibagh, Goa and Kasauli. The company is also in the
business of renting luxury holiday homes under the brand name of
"Lohono Stays" and includes both homes constructed and sold by
Isprava and third-party homes in India and overseas. Symphony made
an investment in Isprava in January 2023.
EDUCATION
WCIB International Co. Ltd. ("WCIB") is a joint venture that
developed and operates Wellington College International Bangkok,
the fifth international addition to the Wellington College family
of schools. WCIB operates a co-educational school that will
ultimately cater to over 1,500 students aged 2-18 years of age when
all phases are fully complete. WCIB commenced operations in August
2018 with inaugural students attending Nursery to Year 6. Symphony
initially invested in the joint venture in January 2017 and has
made subsequent investments with its partners to facilitate ongoing
development of the school and support working capital
requirements.
Creative Technology Solutions DMCC ("CTS") is a UAE-based
company that provides technology solutions to K12 schools in the
UAE and the Kingdom of Saudi Arabia ("KSA"). The company was
founded in 2013 to provide customized IT solutions to the education
sector, including hardware, software and training. Symphony made
its investment in CTS in June 2019. Symphony entered into binding
agreements and completed the sale of its interest in this business
in Q3 2023. Excluding contingent proceeds, the sale generated a net
return per annum and times the original cost of investment (taking
into account dividend distributions) of approximately 23.1% and 2.4
times, respectively.
LOGISTICS
Indo Trans Logistics Corporation ("ITL") was founded in 2000 as
a freight-forwarding company and has since grown to become
Vietnam's largest independent integrated logistics company with a
network that is spread across Vietnam, Cambodia, Laos, Myanmar, and
Thailand. ITL has grown to national champion status in Vietnam.
The Company acquired a significant minority interest in ITL in
June 2019 for US$42.64 million and had a net cost of US$35.28
million (31 December 2022: US$42.14 million) at 30 June 2023.
During the first half of 2023, Symphony completed the sale of a
small number of shares to a strategic Asian logistics company as
part of a larger secondary offering mentioned in earlier updates.
The gross and net sale consideration received was 5.5 times and 4.6
times Symphony's cost of shares sold, respectively.
The fair value for Symphony's interest in ITL at 30 June 2023
was US$63.60 million. The change in value from US$152.25 million at
31 December 2022 is predominantly due to a decline in trailing
EBITDA and the median comparable company market multiple used to
value this business. The weakness in these parameters is reflective
of an overall slowing down in global trade that is expected to
continue at least through 2023.
NEW ECONOMY
In November 2019, Symphony invested in Smarten Spaces Pte. Ltd.
("Smarten"), a Singapore based SaaS (Software-as-a-Service) company
that provides software solutions for space management in commercial
and industrial properties. Smarten was founded in 2017 by Dinesh
Malkani and offers an end-to-end solution for workplace flexibility
on a single technology platform, to help businesses navigate the
new hybrid workplace. The SaaS technology includes four key aspects
- Desk Management, Workforce Rostering, Demand & Supply,
Expenses & Chargeback, and Asset Management; bringing together
key workforce and workplace considerations for a future-ready
solution. Subsequent to 30 June 2023, Symphony completed a
follow-on investment in Smarten.
In September 2020, Symphony invested in August Jewellery Private
Limited ("Melorra"), a Bangalore based omni-channel fast fashion
Indian jewellery company that introduces a fresh collection of 75
new designs every Friday, resulting in over 300 new designs per
month. Founded by Saroja Yeramilli in January 2015, Melorra adopts
a minimal inventory model that uses 3-D printing technology to
achieve just-in-time manufacturing to bring products to market
efficiently. The company also operates experience centres across
India.
Good Capital is majority owned by brothers Rohan and Arjun
Malhotra who founded Investopad in 2014 by investing their own
capital into building substantial infrastructure across India
(Delhi, Bangalore and Gurgaon) and creating a thriving ecosystem of
technology startups. Symphony announced its investment in July
2019, and at 30 June 2023 had a stake in the General Partner, Good
Capital Partners ("GCP") and its first fund, Good Capital Fund I
("GCF"). Subsequent to 30 June 2023, Symphony funded capital calls
related to GCF and Good Capital Fund II.
In August 2021, Symphony invested in Catbus Infolabs Private
Limited ("Blowhorn"), the owner of the Blowhorn platform. Blowhorn
is a same-day intra-city last-mile logistics provider headquartered
in Bangalore, India. The company provides seamless transportation,
warehousing, and a fully technologically integrated system to
manage the end-to-end supply chain process through an asset-light
transportation and distributed micro-warehousing network.
In September 2021, Symphony invested in Kieraya Furnishing
Solutions Private Limited ("Furlenco") a Bangalore based online
residential furniture business. Founded by Ajith Karimpana in
October 2012, Furlenco has a subscription-based furniture rental
business; a refurbished & recycled furniture business; an
appliance subscription service and Prava, which sells high-end
retail furniture.
In September 2021, Symphony invested in Meesho Inc. ("Meesho"),
a Bangalore based social e-commerce platform for
micro-entrepreneurs and Medium and Small Enterprises ("MSME") to
sell to the next 500 million Indians coming online. Founded by
Vidit Aatrey and Sanjeev Barnwal in March 2016, Meesho aims to
enable small businesses, including individual entrepreneurs, to
succeed online by bringing a range of products and new customers
onto the Meesho platform. Meesho started as a reseller-focused
platform enabling millions to sell online and has now become a
single ecosystem connecting sellers to consumers and
entrepreneurs.
In September 2021, Symphony invested in SolarSquare Energy
Private Limited ("Solar Square") a rooftop solar power company that
focuses on residential homes, primarily standalone houses, gated
societies, and small commercial centres. Solar Square was founded
by Neeraj Jain and Nikhil Nahar in 2015; they have since been
joined by Shreya Mishra to refocus the company on the consumer
space. The company aims to make clean energy affordable and
accessible and become the trusted brand in the space.
In December 2022, Symphony invested in MAVI Holding Pte. Ltd.
("MAVI"), a B2B insurance and warranty programme administration
services company headquartered in Singapore with operations in
India, Thailand, and Singapore. Mavi is an early-stage start-up
business with a goal to develop insurance products that are
accessible, competitively priced, and tailored for the Asian
markets. The company will provide insurance and warranty programme
management services and partner with insurance and carriers in the
region to bring these products to market.
Cash and cash equivalents
Symphony has placed funds in certain temporary investments. As
at 30 June 2023 , cash and cash equivalents amounted to US$16.76
million (31 December 2022 : US$18.57 million).
Outlook
The first half of 2023 was generally positive for risk assets
across most markets. However, inflation and the ability of the US
Federal Reserve to steer a soft landing with higher interest rates
remain key concerns. The weakening global demand is expected to
continue in the short term to weigh on most Asian economies and
subdue growth that will affect some businesses. However, the
fundamental long-term growth drivers in Asia remain intact.
Principal Risks
Some of the risks that the Company is exposed to are described
below.
The Company's and the Company's investment management team's
past performance is not necessarily indicative of the Company's
future performance and any unrealised values of investments
presented in this document may not be realised in the future.
The Company is not structured as a typical private equity
vehicle (it is structured as a permanent capital vehicle), and thus
may not have a comparable investment strategy. The investment
opportunities for the Company are more likely to be as a long-term
strategic partner in investments, which may be less liquid, and
which are less likely to increase in value in the short term.
The Company's organisational, ownership and investment structure
may create certain conflicts of interests (for example in respect
of the directorships, shareholdings or interests, including in
portfolio companies that some of the Directors and members of the
Company's investment management team may have). In addition,
neither the Investment Manager nor any of its affiliates owes the
Company's shareholders any fiduciary duties under the Investment
Management Agreement between, inter alia, the Company and the
Investment Manager. The Company cannot assume that any of the
foregoing will not result in a conflict of interest that will have
a material adverse effect on the business, financial condition and
results of operations.
The Company is highly dependent on the Investment Manager, the
Key Persons (as defined in the Investment Management Agreement) and
the other members of the Company's investment management team and
the Company cannot assure shareholders that it will have continued
access to them or their undivided attention, which could affect the
Company's ability to achieve its investment objectives.
The Investment Manager's remuneration is based on the Company's
NAV (subject to minimum and maximum amounts) and is payable even if
the NAV does not increase, which could create an incentive for the
Investment Manager to increase or maintain the NAV in the short
term (rather than the long-term) to the potential detriment of
Shareholders.
The Company's investment policies contain no requirements for
investment diversification and its investments could therefore be
concentrated in a relatively small number of portfolio companies in
the Healthcare, Hospitality, Lifestyle (including branded real
estate developments), logistics and education sectors predominantly
in Asia.
The Company has made, and may continue to make, investments in
companies in emerging markets, which exposes it to additional risks
(including, but not limited to, the possibility of exchange control
regulations, political and social instability, nationalisation or
expropriation of assets, the imposition of taxes, higher rates of
inflation, difficulty in enforcing contractual obligations, fewer
investor protections and greater price volatility) not typically
associated with investing in companies that are based in developed
markets.
Furthermore, the Company has made, and may continue to make,
investments in portfolio companies that are susceptible to economic
recessions or downturns. Such economic recessions or downturns may
also affect the Company's ability to obtain funding for additional
investments.
The Company's investments include investments in companies that
it does not control and/or made with other co-investors for
financial or strategic reasons. Such investments may involve risks
not present in investments where the Company has full control or
where a third party is not involved. For example, there may be a
possibility that a co-investor may have financial difficulties or
become bankrupt or may at any time have economic or business
interests or goals which are inconsistent with those of the Company
or may be in a position to take or prevent actions in a manner
inconsistent with the Company's objectives. The Company may also be
liable in certain circumstances for the actions of a co-investor
with which it is associated. In addition, the Company holds a
non-controlling interest in certain investments, and therefore, may
have a limited ability to protect its position in such
investments.
A number of the Company's investments are currently, and likely
to continue to be, illiquid and/ or may require a long-term
commitment of capital. The Company's investments may also be
subject to legal and other restrictions on resale. The illiquidity
of these investments may make it difficult to sell investments if
the need arises.
The Company's real estate related investments may be subject to
the risks inherent in the ownership and operation of real estate
businesses and assets. A downturn in the real estate sector or a
materialization of any of the risks inherent in the real estate
business and assets could materially adversely affect the Company's
real estate investments. The Company's portfolio companies also
anticipate selling a significant proportion of development
properties prior to completion. Any delay in the completion of
these projects may result in purchasers terminating off-plan sale
agreements and claiming refunds, damages and/or compensation.
The Company is exposed to foreign exchange risk when investments
and/ or transactions are denominated in currencies other than the
U.S. dollar, which could lead to significant changes in the net
asset value that the Company reports from one quarter to
another.
The Company's investment policies and procedures (which
incorporate the Company's investment strategy) provide that the
Investment Manager should review the Company's investment policies
and procedures on a regular basis and, if necessary, propose
changes to the Board when it believes that those changes would
further assist the Company in achieving its objective of building a
strong investment base and creating long term value for its
Shareholders. The decision to make any changes to the Company's
investment policy and strategy, material or otherwise, rests with
the Board in conjunction with the Investment Manager and
Shareholders have no prior right of approval for material changes
to the Company's investment policy.
Investments in connection with special situations and structured
transactions typically have shorter operating histories, narrower
product lines and smaller market shares than larger businesses,
which tend to render them more vulnerable to competitors' actions
and market conditions, as well as general economic downturns.
Investments that fall into this category tend to have relatively
short holding periods and entail little or no participation in the
board of the company in which such investments may be made. Special
situations and structured transactions in the form of fixed debt
investments also carry an additional risk that an increase in
interest rates could decrease their value.
The Company's current investment policies and procedures provide
that it may invest an amount of no more than 30% of its total
assets in special situations and structured transactions which,
although they are not typical longer-term investments, have the
potential to generate attractive returns and enhance the Company's
net asset value. Following the Company's investment, it may be that
the proportion of its total assets invested in longer-term
investments falls below 70% and the proportion of its total assets
invested in special situations and structured transactions exceeds
30% due to changes in the valuations of the assets, over which the
Company has no control.
Pending the making of investments, the Company's capital will
need to be temporarily invested in liquid investments and managed
by a third-party investment manager of international repute or held
on deposit with commercial banks before they are invested. The
returns that temporary investments are expected to generate and the
interest that the Company will earn on deposits with commercial
banks will be substantially lower than the returns that it
anticipates receiving from its longer-term investments or special
situations and structured transactions.
In addition, while the Company's temporary investments will be
relatively conservative compared to its longer-term investments or
special situations and structured transactions, they are
nevertheless subject to the risks associated with any investment,
which could result in the loss of all or a portion of the capital
invested.
The Investment Manager has identified but has not yet contracted
to make further potential investments. The Company cannot guarantee
shareholders that any or all of these prospective investments will
take place in the future.
The market price of the Company's shares may fluctuate
significantly and shareholders may not be able to resell their
shares at or above the price at which they purchased them.
The Company's shares are currently trading, and have in the past
traded, and could in the future trade, at a discount to NAV for a
variety of reasons, including due to market conditions. The only
way for shareholders to realise their investment is to sell their
shares for cash. Accordingly, in the event that a shareholder
requires immediate liquidity, or otherwise seeks to realise the
value of his investment through a sale, the amount received by the
shareholder upon such sale may be less than the underlying NAV of
the shares sold.
The Company could be materially adversely affected by the
widespread outbreak of infectious disease or other public health
crises (or by the fear or imminent threat thereof), including the
current COVID-19 pandemic. Public health crises such as SARS,
H1N1/09 flu, avian flu, Ebola, and the current COVID-19 pandemic,
together with any related containment or other remedial measures
undertaken or imposed, could have a material and adverse effect on
the Company including by (i) disrupting or otherwise materially
adversely affecting the human capital, business operations or
financial resources of the Company, the Company's portfolio
companies, the Investment Manager or service providers and (ii)
adversely affect the ability, or the willingness, of a party to
perform its obligations under its contracts and lead to uncertainty
over whether such failure to perform (or delay in performing) might
be excused under so-called "material adverse change," force majeure
and similar provisions in such contracts that could cause a
material impact to the Company, the Company's portfolio companies,
the Investment Manager or service providers and (iii) severely
disrupting global, national and/or regional economies and financial
markets and precipitating an economic downturn or recession that
could materially adversely affect the value and performance of the
Company's shares.
Our business could be materially affected by conditions in the
global capital markets and the economy generally. Geopolitical
issues, including the recent Russian invasion of Ukraine and
related international response measures may have a negative impact
on regional and global economic conditions, as a result of
disruptions in foreign currency markets and increased energy and
commodity prices. This could in turn have a spill-over effect on
our portfolio companies, such as reducing demand for products or
services offered by our portfolio companies and/or cause for
example, higher operating and financing costs.
Directors' Responsibility Statement
We, the directors of Symphony International Holdings Limited,
confirm that to the best of our knowledge:
(a) the condensed interim financial statements, which have been
prepared in accordance with IAS 34 - Interim Financial Reporting,
give a true and fair view of the assets, liabilities, financial
position and profit or loss of the Company as required by DTR
4.2.4R ; and
(b) the interim financial results include a fair review of information required by:
(i) DTR 4.2.7R of the Disclosure and Transparency Rules, being
an indication of important events that have occurred during the
first six months of the financial year and their impact on the
financial statements, and a description of the principal risks and
uncertainties for the remaining six months of the year; and
(ii) DTR 4.2.8R of the Disclosure and Transparency Rules, being
related party transactions that have taken place in the first six
months of the current financial year and that have materially
affected the financial position or performance of the Company
during that period, and any changes in the related party
transactions described in the last annual report that could do
so.
For and on behalf of the Board of Directors
Georges Gagnebin
Chairman, Symphony International Holdings Limited
Anil Thadani
Chairman, Symphony Asia Holdings Pte. Ltd.
Director, Symphony International Holdings Limited
Symphony International Holdings Limited
Condensed statement of financial position
As at 30 June 2023
30 June 31 December
Note 2023 2022
US$'000 US$'000
Non-current assets
Financial assets at fair value through
profit or loss 7 399,756 478,226
Prepayments * *
---------- --------------
399,756 478,226
---------- --------------
Current assets
Other receivables and prepayments 83 82
Cash and cash equivalents 16,764 18,573
---------- --------------
16,847 18,655
---------- --------------
Total assets 416,603 496,881
========== ==============
Equity attributable to equity holders
of the Company
Share capital 409,704 409,704
Accumulated (losses)/profits (6,379) 86,758
---------- --------------
Total equity 403,325 496,462
---------- --------------
Current liabilities
Other payables 13,278 419
Total liabilities 13,278 419
---------- --------------
Total equity and liabilities 416,603 496,881
========== ==============
* Less than US$1,000
Symphony International Holdings Limited
Condensed statement of comprehensive income
Period from 1 January 2023 to 30 June 2023
6 months 6 months
ended ended
30 June 30 June
Note 2023 2022
US$'000 US$'000
Other operating income 288 8,507
Other operating expenses (2,054) (5,497)
Management fees (5,320) (5,404)
Loss before investment results and
income tax (7,086) (2,394)
Fair value changes in financial assets
at fair value through profit or loss 7 (73,217) (3,991)
Loss before income tax (80,303) (6,385)
Income tax expense - -
----------- -----------
Loss for the period (80,303) (6,385)
Other comprehensive income for the
period,
net of tax - -
----------- -----------
Total comprehensive income for the
period (80,303) (6,385)
Earnings per share:
US Cents US Cents
Basic 8 (15.64) (1.24)
=========== ===========
Diluted (15.64) (1.24)
=========== ===========
Symphony International Holdings Limited
Condensed statement of changes in equity
Period from 1 January 2023 to 30 June 2023
Share Total
capital Accumulated profits equity
US$'000 US$'000 US$'000
At 1 January 2022 409,704 79,151 488,855
Total comprehensive income for the period - (6,385) (6,385)
-------- -------------------
Transactions with owners of the Company, recognised directly in equity
Contributions by and distributions to owners
-------- ------------------- -------
Forfeiture of dividend paid in prior years - 15 15
-------- ------------------- -------
Total transactions with owners of the Company - 15 15
At 30 June 2022 409,704 72,781 482,485
======== =================== =======
Symphony International Holdings Limited
Condensed statement of changes in equity
Period from 1 January 2023 to 30 June 2023
Share Accumulated Total
capital profits/(losses) equity
US$'000 US$'000 US$'000
At 1 January 2023 409,704 86,758 496,462
Total comprehensive income for the period - (80,303) (80,303)
-------- -----------------
Transactions with owners of the Company, recognised directly in equity
Contributions by and distributions to owners
-------- ----------------- --------
Dividends declared of US$0.025 per share - (12,834) (12,834)
-------- ----------------- --------
Total transactions with owners of the Company - (12,834) (12,834)
At 30 June 2023 409,704 (6,379) 403,325
======== ================= ========
Symphony International Holdings Limited
Condensed statement of cash flows
Period from 1 January 2023 to 30 June 2023
6 months 6 months
ended ended
30 June 30 June
2023 2022
US$'000 US$'000
Cash flows from operating activities
Loss before income tax (80,303) (6,385)
Adjustments for:
Dividend income - (8,505)
Exchange loss 1,460 5,017
Interest income (288) (2)
Interest expense 1 -
Write-off of amount due from unconsolidated
subsidiary - 12
Fair value changes in financial assets
at fair value through profit or loss 73,217 3,991
(5,913) (5,872)
Changes in:
* Other receivables and prepayments 39 40
* Other payables 22 52
(5,852) (5,780)
Interest received 249 *
Net cash used in operating activities (5,603) (5,780)
-------- --------
Cash flows from investing activity
Net proceeds received from unconsolidated
subsidiaries 3,797 7,326
Net cash from investing activity 3,797 7,326
-------- --------
Cash flows from financing activities
Interest paid (1) -
Forfeiture of dividend paid in prior
years - 15
Net cash (used in)/from financing
activities (1) 15
-------- --------
Net (decrease)/increase in cash and
cash equivalents (1,807) 1,561
Cash and cash equivalents at beginning
of period 18,573 8,357
Effect of exchange rate fluctuations (2) (3)
-------- --------
Cash and cash equivalents at end
of the period 16,764 9,915
======== ========
* Less than US$1,000
Symphony International Holdings Limited
Notes to the condensed interim financial statements
Period from 1 January 2023 to 30 June 2023
These notes form an integral part of the condensed interim
financial statements.
1 REPORTING ENTITY
Symphony International Holdings Limited (the "Company") is a
company domiciled in the British Virgin Islands.
The financial statements of the Company as at and for the year
ended 31 December 2022 are available upon request from the
Company's registered office at Vistra Corporate Services Centre,
Wickhams Cay II, Road Town, Tortola VG1110 British Virgin
Islands.
2 STATEMENT OF COMPLIANCE
These condensed interim financial statements have been prepared
in accordance with IAS 34 Interim Financial Reporting. They do not
include all of the information required for full annual financial
statements, and should be read in conjunction with the financial
statements of the Company as at and for the year ended 31 December
2022 .
These condensed interim financial statements were approved by
the Board of Directors on 22 September 2023.
3 SIGNIFICANT ACCOUNTING POLICIES
The accounting policies applied by the Company in these
condensed interim financial statements are the same as those
applied by the Company in its financial statements as at and for
the year ended 31 December 2022 . The Company qualifies as an
investment entity, as a result of which all immediate investments
are carried at fair value through profit or loss.
4 Estimates
The preparation of interim financial statements in conformity
with International Financial Reporting Standards requires
management to make judgements, estimates and assumptions that
affect the application of accounting policies and the reported
amounts of assets and liabilities, income and expense. Actual
results may differ from these estimates.
In preparing these condensed interim financial statements, the
significant judgements made by management in applying the Company's
accounting policies and the key sources of estimation uncertainty
were the same as those that applied to the condensed financial
statements as at and for the year ended 31 December 2022 .
Uncertain economic environment
The uncertain economic environment has increased the estimation
uncertainty in developing significant accounting estimates,
predominantly related to financial assets at fair value through
profit or loss ('FVTPL').
The estimation uncertainty is associated with:
-- the extent and duration of the expected economic downturn and
subsequent recovery. This includes the impacts on liquidity,
increasing unemployment, declines in consumer spending and
forecasts for key economic factors;
-- the extent and duration of the disruption to business arising
from the expected economic downturn; and
-- the effectiveness of government and central bank measures
that have and will be put in place to support businesses and
consumers through this disruption and economic downturn.
The Company has developed accounting estimates based on
forecasts of economic conditions which reflect expectations and
assumptions as at 30 June 2023 about future events that management
believes are reasonable in the circumstances.
There is a considerable degree of judgement involved in
preparing forecasts. The underlying assumptions are also subject to
uncertainties which are often outside the control of the Company.
Accordingly, actual economic conditions are likely to be different
from those forecast since anticipated events frequently do not
occur as expected, and the effect of those differences may
significantly impact accounting estimates included in these
condensed financial statements.
The impact of the uncertain economic environment on financial
assets at FVTPL is discussed further in Note 7.
5 financial risk management
The Company's financial risk management objectives and policies
are consistent with those disclosed in the financial statements as
at and for the year ended 31 December 2022 .
6 Financial assets at fair value through profit or loss
During the financial period ended on 30 June 2023 :
i. The Company recognised a fair value loss in financial assets
at FVTPL of US$73,217,000 (30 June 2022: US$3,991,000).
ii. During the six-month period ended 30 June 2023 , the
Company's wholly owned subsidiary, Symphony (Mint) Investment
Limited, sold approximately 6.30 million shares and 9.99 million
warrants held in Minor International PCL in the market through a
series of transactions.
iii. On 13 January 2023, the Company's wholly owned subsidiary,
Symphony Luxre Holdings Pte. Ltd., subscribed to securities in
Isprava Vesta Private Limited. The associated cost from this
investment was less than 5% of NAV.
iv. On 15 March 2023, the Company's wholly owned subsidiary,
Symphony Assure Pte. Ltd., subscribed to securities in Mavi Holding
Pte. Ltd. The associated cost from this investment was less than 1%
of NAV.
v. On 26 April 2023, the Company's wholly owned subsidiary,
Symphony Logistics Pte. Ltd. sold some shares in Indo Trans
Logistics Corporation that generated net proceeds equivalent to
less than 2% of NAV.
vi. On 26 June 2023, the Company's wholly owned subsidiary,
Britten Holdings Pte. Ltd., subscribed to additional compulsory
convertible preference shares in Soothe Healthcare Private Limited.
The associated cost for the additional investment was less than 1%
of NAV.
7 financial instruments
Accounting classification and fair values
The carrying amounts and fair values of financial assets and
financial liabilities are as follows. It does not include fair
value information for financial assets and financial liabilities
not measured at fair value if the carrying amount is a reasonable
approximation of fair value.
Carrying amount
------------------------------------------------------
Fair value
through Other
profit Amortised financial
or loss cost liabilities Total Fair value
US$'000 US$'000 US$'000 US$'000 US$'000
30 June 2023
Financial assets
measured at fair
value
Financial assets
at fair value through
profit or loss 399,756 - - 399,756 399,756
Financial assets
not measured at fair
value
Other receivables(1) - 46 - 46
Cash and cash equivalents - 16,764 - 16,764
------------------- --------- ------------ --------
399,756 16,810 - 416,566
=================== ========= ============ ========
Financial liabilities
not measured at fair
value
Other payables - - (13,278) (13,278)
=================== ========= ============ ========
(1) Excludes prepayments
Carrying amount
--------------------------------------------
Fair value
through Other
profit Amortised financial
or loss cost liabilities Total Fair value
US$'000 US$'000 US$'000 US$'000 US$'000
31 December 2022
Financial assets
measured at fair
value
Financial assets
at fair value through
profit or loss 478,226 - - 478,226 478,226
Financial assets
not measured at fair
value
Other receivables(1) - 7 - 7
Cash and cash equivalents - 18,573 - 18,573
478,226 18,580 - 496,806
========== ========= ============ =======
Financial liabilities
not measured at fair
value
Other payables - - (419) (419)
---------- --------- ------------ -------
(1) Excludes prepayments
Fair value
The financial assets at fair value through profit or loss are
measured using the adjusted net asset value method, which is based
on the fair value of the underlying investments. The fair values of
the underlying investments are determined based on the following
methods:
i) for quoted equity investments, based on quoted market bid
prices at the financial reporting date without any deduction for
transaction costs;
ii) for unquoted investments, with reference to the enterprise
value at which the portfolio company could be sold in an orderly
disposition over a reasonable period of time between willing
parties other than in a forced or liquidation sale, and is
determined by using valuation techniques such as (a) market
multiple approach that uses a specific financial or operational
measure that is believed to be customary in the relevant industry,
(b) price of recent investment, or offers for investment, for the
portfolio company's securities, (c) current value of publicly
traded comparable companies, (d) comparable recent arms' length
transactions between knowledgeable parties, and (e) discounted cash
flows analysis; and
iii) for financial assets and liabilities with a maturity of
less than one year or which reprice frequently (including other
receivables, cash and cash equivalents, and other payables) the
notional amounts are assumed to approximate their fair values
because of the short period to maturity/repricing.
The objective of valuation techniques is to arrive at a fair
value measurement that reflects the price that would be received to
sell the asset or paid to transfer the liability in an orderly
transaction between market participants at the measurement
date.
Fair value hierarchy for financial instruments
The table below analyses financial instruments carried at fair
value, by valuation method. The different levels have been defined
as follows:
-- Level 1: Inputs that are quoted market prices (unadjusted) in
active markets for identical instruments.
-- Level 2: Inputs other than quoted prices included within
Level 1 that are observable, either directly (i.e. as prices) or
indirectly (i.e. derived from prices). This category includes
instruments valued using: quoted market prices in active markets
for similar instruments; quoted prices for identical or similar
instruments in markets that are not considered active; or other
valuation techniques in which all significant inputs are directly
or indirectly observable from market data.
-- Level 3: Inputs that are unobservable. This category includes
all instruments for which the valuation technique includes input
not based on observable data and the unobservable inputs have a
significant effect on the instruments' valuation. This category
includes instruments that are valued based on quoted prices for
similar instruments but for which significant unobservable
adjustments or assumptions are required to reflect differences
between instruments.
Level 1 Level 2 Level 3 Total
US$'000 US$'000 US$'000 US$'000
30 June 2023
Financial assets at fair
value through profit or
loss - - 399,756 399,756
31 December 2022
Financial assets at fair
value through profit or
loss - - 478,226 478,226
========== ========== ========== ==========
The fair value hierarchy table excludes financial assets and
financial liabilities such as cash and cash equivalents, other
receivables and other payables because their carrying amounts
approximate their fair values due to their short-term period to
maturity/repricing.
Level 3 valuations
The following table shows a reconciliation from the beginning
balances to the ending balances for fair value measurements in
Level 3 of the fair value hierarchy.
30 June 31 December
2023 2022
Financial assets at
fair value through
profit or loss
US$'000 US$'000
Balance at 1 January 478,226 480,755
Fair value changes in profit or loss (73,217) 8,902
Net repayment from unconsolidated subsidiaries (5,253) (12,942)
Net additions - 1,511
Balance at 30 June/31 December 399,756 478,226
=========== ==============
Significant unobservable inputs used in measuring fair value
This table below sets out information about significant
unobservable inputs used at 30 June 2023 in measuring the
underlying investments of the financial assets categorised as Level
3 in the fair value hierarchy excluding investments purchased
during the year that are valued at transaction prices as they are
reasonable approximation of fair values and ultimate investments in
listed entities.
Fair
value Fair value
at 30 at Sensitivity
June 31 December to changes in
2023 2022 Valuation Unobservable Range (Weighted significant unobservable
Description US$'000 US$'000 technique input average) inputs
------------- -------- ------------ --------------- --------------- --------------- -------------------------
-0.4% -
11.6%
(Dec 2022
:
- 0.7%
- 2.0 %)
Rental growth
rate 1.6% - 46
%
(Dec 2022 The estimated
Occupancy : 15% - fair value would
rate 51 %) increase if the
rental growth
13% rate and occupancy
(Dec 2022 rate were higher
Rental Discount : 13% - and the discount
properties 1,914 2,429 Income approach rate 13.5%) rate was lower.
US$ 256
to US$6,403
per square
meter
Price per (Dec 2022 The estimated
square : US$379 fair value would
Comparable meter to US$7,032 increase if the
Land related valuation for comparable per square price per square
investments 57,671 59,941 method land meter) meter was higher.
------------- -------- ------------ --------------- --------------- --------------- -------------------------
Fair
value Fair value
at 30 at Sensitivity
June 31 December to changes in
2023 2022 Valuation Unobservable Range (Weighted significant unobservable
Description US$'000 US$'000 technique input average) inputs
------------ -------- ------------ ----------------- ------------------ --------------- ------------------------
Earnings 1.3x -
before interest, 42.2x ,
tax, depreciation median 9.0x The estimated
Enterprise and amortisation (Dec 2022 fair value would
value using ('EBITDA') : 0.3x - increase if the
Operating comparable multiple 33.4x , EBITDA multiple
business 210,393 292,350 traded multiples (times) median 7.7x) was higher.
Revenue 0.2x - The estimated
multiple 9.9x fair value would
(times) (Dec 2022 increase if the
: 0.6x - revenue multiple
12.5x , was higher
median 5.9x)
Discount 25% The estimated
for lack fair value would
of marketability increase if the
('DLOM') discount for
lack of marketability
was lower.
(Dec 2022
: 25.0 %)
Option pricing Volatility 29,3% - The estimated
model* 63,3% fair value would
increase or decrease
if the volatility
was higher depending
on factors specific
to the investment.
(Dec 2022
:
23.4% -
54.2%)
Risk-free 4.1 % - The estimated
rate 6.7% fair value would
increase or decrease
if risk-free
rate was lower
depending on
factors specific
to the investment
(Dec 2022
:
4.5 % -
7.0%)
The estimated
fair value would
increase if the
Greenfield revenue growth
business increases, expense
held for Discounted ratio decreases,
more than cash flow Revenue and WACC was
12-months 41,312 41,325 method growth 2.8% - 26.9% lower.
(Dec 2022
: 1.0 %
- 26.9%)
----------------- ------------------------
Expense 57.9% -
ratio 74,0%
(Dec 2022
: 57.9 %
- 87.8%)
Weighted 12.8% -
average 15.9%
cost of
capital
('WACC')
(Dec 2022
: 14.7 %
- 16.3%)
------------ -------- ------------ ----------------- ------------------ --------------- ------------------------
* The option pricing model is used as a secondary valuation
technique for certain investments to allocate equity value where
the capital structure of the investment consists of instruments
with significantly different rights/terms.
The rental growth rate represents the growth in rental income
during the leasehold period while the occupancy rates represent the
percentage of the building that is expected to be occupied during
the leasehold period. Management adopt a valuation report produced
by an independent valuer that determines the rental growth rate and
occupancy rate after considering the current market conditions and
comparable occupancy rates for similar buildings in the same
area.
The discount rate is related to the current yield on long-term
government bonds plus a risk premium to reflect the additional risk
of investing in the subject properties. Management adopts a
valuation report produced by an independent valuer that determines
the discount based on the independent valuer's judgement after
considering current market rates.
The comparable recent sales represent the recent sales prices of
properties that are similar to the investee companies' properties,
which are in the same area. Management adopts a valuation report
produced by an independent valuer to determine the value per square
meter based on the average recent sales prices.
During the year ended 31 December 2022, an investment that was
previously valued using comparable recent sales was valued using
the discounted cash flow method due to changes in the operations
and future earnings potential of the underlying investee
company.
The EBITDA multiple represents the amount that market
participants would use when pricing investments. The EBITDA
multiple is selected from comparable public companies with similar
business as the underlying investment. Management obtains the
median EBITDA multiple from the comparable companies and applies
the multiple to the EBITDA of the underlying investment. In some
instances, Management obtains the lower quartile multiple from
comparable companies and applies the multiple to the EBITDA of the
underlying investment. The amount is further discounted for
considerations such as lack of marketability.
The revenue multiple represents the amount that market
participants would use when pricing investments. The revenue
multiple is selected from comparable public companies with similar
business as the underlying investment. Management obtains the
median revenue multiple from the comparable companies and applies
the multiple to the revenue of the underlying investment. The
amount is further discounted for considerations such as lack of
marketability.
The discount for lack of marketability represents the discount
applied to the comparable market multiples to reflect the
illiquidity of the investee relative to the comparable peer group.
Management determines the discount for lack of marketability based
on its judgement after considering market liquidity conditions and
company-specific factors.
During the year ended 31 December 2022, two investments that
were previously valued using the EBITDA multiple technique were
valued using the price of recent investment for the investee
company's securities as there were recent transactions in the
secondary market which reflects more accurately the value of the
underlying investment.
During the period ended 30 June 2023, an investment that was
valued using the EBITDA multiple technique was valued using the
price of recent investment for the investee company's securities in
the current period as there were recent transactions in the
secondary market.
The option pricing model uses distribution allocation for each
equity instrument at different valuation breakpoints, taking into
consideration the different rights/terms of each instrument. An
option pricing computation is done using a Black Scholes Model at
different valuation breakpoints (strikes) using market volatility
and risk-free rate parameters. Where a recent transaction price for
an identical or similar instrument is available, it is used as the
basis for fair value.
During the year ended 31 December 2022, one investment that
previously used a recent transaction price as the basis for fair
value in the option pricing model had used the revenue multiple
technique as the basis for fair value as there was no recent
transaction.
The revenue growth represents the growth in sales of the
underlying business and is based on the operating management team's
judgement on the change of various revenue drivers related to the
business from year-to-year. The expense ratio is based on the
judgement of the operating management team after evaluating the
expense ratio of comparable businesses and is a key component in
deriving EBITDA and free cash flow for the greenfield business. The
free cashflow is discounted at the WACC to derive the enterprise
value of the greenfield business. Net debt is then deducted to
arrive at an equity value for the business. WACC is derived after
adopting independent market quotes or reputable published
research-based inputs for the risk-free rate, market risk premium,
small cap premium and cost of debt.
The investment entity approach requires the presentation and
fair value measurement of immediate investments; the shares of
intermediate holding companies are not listed. However, ultimate
investments in listed entities amounting to US$59,464,000 (31
December 2022 : US$65,666,000) are held through intermediate
holding companies; the value of these companies are mainly
determined by the fair values of the ultimate investments.
Sensitivity analysis
Although the Company believes that its estimates of fair value
are appropriate, the use of different methodologies or assumptions
could lead to different measurements of fair value. For fair value
measurements in Level 3 assets, changing one or more of the
assumptions used to reasonably possible alternative assumptions
would have the following effects on the profit or loss by the
amounts shown below. The effect of the uncertain economic
environment has meant that the range of reasonably possible changes
is wider than in periods of stability .
-------- 30 June 2023 -------- 30 June 2022
-------- --------
Effect on profit or Effect on profit or
loss loss
Favourable (Unfavourable) Favourable (Unfavourable)
US$'000 US$'000 US$'000 US$'000
Level 3 assets 101,233 (64,126) 44,445 (45,309)
============= ================= ============= =================
The favourable and unfavourable effects of using reasonably
possible alternative assumptions have been calculated by
recalibrating the valuation model using a range of different
values.
For rental properties, the projected rental rates and occupancy
levels were increased by 10% (30 June 2022 : 10%) for the
favourable scenario and reduced by 10% (30 June 2022 : 10%) for the
unfavourable scenario. The discount rate used to calculate the
present value of future cash flows was also decreased by 2% (30
June 2022 : 2%) for the favourable case and increased by 2% (30
June 2022 : 2%) for the unfavourable case compared to the discount
rate used in the valuation as at 30 June 2023 .
For land related investments (except those held for less than
12-months where cost represents the most reliable estimate of fair
value in the absence of significant developments since the
transaction), which are valued on comparable transaction basis by
third party valuation consultants, the fair value of the land is
increased by 20% (30 June 2022 : 20%) in the favourable scenario
and reduced by 20% (30 June 2022 : 20%) in the unfavourable
scenario.
For operating businesses (except those where a last transacted
price exists within the past 12-months that provides the basis for
fair value) that are valued on a trading comparable basis using
enterprise value to revenue or EBITDA, the revenue or EBITDA is
increased by 20% (30 June 2022 : 20%) and decreased by 20% (30 June
2022 : 20%), and DLOM is decreased by 5% (30 June 2022: 5%) and
increased by 5% (30 June 2022: 5%) in the favourable and
unfavourable scenarios respectively.
In the option pricing model sensitivity analysis, the change in
risk-free rate and volatility results in different outcomes for
each investment. An increase in risk-free rate and volatility may
have a favourable or unfavourable impact and vice versa. This is a
result of multiple factors including cumulative impact of two
variables (risk-free rate, volatility) being changed simultaneously
after taking into account variations in investment specific input
variables, such as time to expiry, capital structure and the
liquidation preference related to securities. The volatility is
adjusted by 10% (30 June 2022: 10%) and the risk-free rate is
adjusted by 2% (30 June 2022: 2%) to arrive at the favourable and
unfavourable scenario depending on factors specific to each
investment.
For greenfield businesses (except those where a last transacted
price exists within the past 12-months) that are valued using a
discounted cashflow, the revenue growth rate is increased by 2% (30
June 2022 : 2%), the expense ratio rate is decreased by 10% (30
June 2022 : 10%) and the WACC is reduced by 2% (30 June 2022 : 2%)
in the favourable scenario. Conversely, in the unfavourable
scenario, the revenue growth rate is reduced by 2% (30 June 2022 :
2%), the expense ratio rate is increased by 10% (30 June 2022 :
10%) and the WACC is increased by 2% (30 June 2022 : 2%).
8 earnings PER SHARE
6 months 6 months
ended ended
30 June 30 June
2023 2022
US$'000 US$'000
Basic and diluted earnings per share
are based on:
Loss for the period attributable
to ordinary shareholders (80,303) (6,385)
============= =============
Basic and diluted earnings per share
Number Number
of shares of shares
30 June 30 June
2023 2022
Issued ordinary shares at 1 January
and 30 June 513,366,198 513,366,198
============= =============
Weighted average number of shares
(basic and diluted) 513,366,198 513,366,198
============= =============
At 30 June 2023 and 30 June 2022 , there were no outstanding
share options to subscribe for ordinary shares of no par value.
9 Operating segments
The Company has investment segments, as described below.
Investment segments are reported to the Board of Directors of
Symphony Asia Holdings Pte. Ltd., the Investment Manager, who
review this information on a regular basis.
Segment results, assets and liabilities include items directly
attributable to a segment as well as those that can be allocated on
a reasonable basis.
Business activities which do not meet the definition of an
operating segment have been reported in the reconciliations of
total reportable segment amounts to the financial statements.
The following summary describes the investments in each of the
Company's reportable segments.
Healthcare Includes investments in ASG Hospital
Private Limited (ASG) and Soothe Healthcare
Private Limited (Soothe)
Hospitality Minor International Public Company
Limited (MINT)
Education Includes investments in WCIB International
Co. Ltd. (WCIB) and Creative Technology
Solutions DMCC (CTS)
Lifestyle Includes investments in Chanintr Living
Ltd. (Chanintr), the Wine Connection
Group (WCG) and Liaigre Group (Liaigre)
Lifestyle/Real Estate Includes investments in Minuet Ltd.,
SG Land Co. Ltd., a property joint
venture in Niseko, Hokkaido, Japan,
Desaru Peace Holdings Sdn Bhd and Isprava
Vesta Private Limited (Isprava)
Logistics In Do Trans Logistics Corporation (ITL)
Includes Smarten Spaces Pte. Ltd. (Smarten),
New Economy Good Capital Partners and Good Capital
Fund I (collectively, Good Capital),
August Jewellery Private Limited (Melorra),
Kieraya Furnishing Solutions Private
Limited (Furlenco), Catbus Infolabs
Private Limited (Blowhorn), Meesho
Inc. (Meesho), SolarSquare Energy Private
Limited (Solar Square), Mavi Holding
Pte. Ltd. (Mavi) and Epic Games
Cash and temporary investments Includes government securities or other
investment grade securities, liquid
investments which are managed by third
party investment managers of international
repute, and deposits placed with commercial
banks
The reportable operating segments derive their revenue primarily
by achieving returns, consisting of dividend income, interest
income and appreciation in fair value. The Company does not monitor
the performance of the investments by measure of profit or
loss.
Information regarding the results of each reportable segment is
included below:
Lifestyle/ Cash and Logistics
real temporary US$'000
Healthcare Hospitality Education Lifestyle estate Logistics investments New Economy Total
US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
6 months ended 30
June 2023
Investment income
* Interest income - - - - - - 288 - 288
- - - - - - 288 - 288
------------- -------------- ------------ ------------ ------------- ------------ -------------- --------------- ----------
Investment expenses
* Exchange loss (1) * (1) 741 (2,190) (1) (5) (3) (1,460)
* Fair value changes of financial assets at FVTPL (1,822) 3,038 5,194 6,738 (3,363) (81,807) - (1,195) (73,217)
(1,823) 3,038 5,193 7,479 (5,553) (81,808) (5) (1,198) (74,677)
------------- -------------- ------------ ------------ ------------- ------------ -------------- --------------- ----------
Net investment results (1,823) 3,038 5,193 7,479 (5,553) (81,808) 283 (1,198) (74,389)
============= ============== ============ ============ ============= ============ ============== =============== ==========
6 months ended 30
June 2022
Investment income
* Dividend income - - - - 7,495 - 1,010 - 8,505
* Interest income - - - - - - 2 - 2
- - - - 7,495 - 1,012 - 8,507
------------- -------------- ------------ ------------ ------------- ------------ -------------- --------------- ----------
Investment expenses
* Exchange loss (3) * (3) (3,263) (1,757) (1) 15 (5) (5,017)
* Fair value changes of financial assets at FVTPL 22,847 8,652 (6,162) (4,901) (14,721) (12,999) (1,011) 4,304 (3,991)
------------- -------------- ------------ ------------ ------------- ------------ -------------- --------------- ----------
22,844 8,652 (6,165) (8,164) (16,478) (13,000) (996) 4,299 (9,008)
------------- -------------- ------------ ------------ ------------- ------------ -------------- --------------- ----------
Net investment results 22,844 8,652 (6,165) (8,164) (8,983) (13,000) 16 4,299 (501)
============= ============== ============ ============ ============= ============ ============== =============== ==========
* Less than US$1,000
Lifestyle/ Cash and Logistics
real temporary US$'000
Healthcare Hospitality Education Lifestyle estate Logistics investments New Economy Total
US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
30 June 2023
Segment
assets 50,975 60,309 17,379 63,569 97,069 63,602 16,764 46,853 416,520
============= ============== ============ ============ ============= ============ ============== =============== ==========
Segment
liabilities - - - - - - - - -
============= ============== ============ ============ ============= ============ ============== =============== ==========
31 December
2022
Segment
assets 52,117 66,135 12,185 56,031 92,870 152,262 18,574 46,625 496,799
============= ============== ============ ============ ============= ============ ============== =============== ==========
Segment
liabilities - - - - - - - - -
============= ============== ============ ============ ============= ============ ============== =============== ==========
Reconciliations of reportable segment profit or loss, assets and
liabilities
30 June 30 June
2023 2022
US$'000 US$'000
Profit or loss
Net investments results (74,389) (501)
Unallocated amounts:
* Other corporate expenses (5,914) (5,884)
----------- ----------
Loss for the period (80,303) (6,385)
=========== ==========
Assets
Total assets for reportable segments 416,520 482,824
Other assets 83 31
----------- ----------
Total assets 416,603 482,855
=========== ==========
Liabilities
Total liabilities for reportable segments - -
Other payables 13,278 370
Total liabilities 13,278 370
=========== ==========
10 Significant Related Party Transactions
For the purposes of these condensed interim financial
statements, parties are considered to be related to the Company if
the Company has the ability, directly or indirectly, to control the
party or exercise significant influence over the party in making
financial and operating decisions, or vice versa, or where the
Company and the party are subject to common control or common
significant influence. Related parties may be individuals or
entities.
Dividend income
During the financial period ended 30 June 2023 , the Company
recognised dividend income from its unconsolidated subsidiaries
amounting to US$Nil (30 June 2022 : US$8,505,000).
Key management personnel compensation
Key management personnel of the Company are those persons having
the authority and responsibility for planning, directing and
controlling the activities of the Company. The directors of the
Company are considered as key management personnel.
During the financial period ended 30 June 2023 , directors' fees
amounting to US$186,000 (30 June 2022 : US$198,000) were declared
as payable to four directors of the Company. The remaining two
directors of the Company are also directors of the Investment
Manager who provides management and administrative services to the
Company on an exclusive and discretionary basis. No remuneration
has been paid to these two directors as the cost of their services
form part of the Investment Manager's remuneration.
Other related party transactions
Pursuant to the Investment Management Agreement, the Investment
Manager will provide investment management and advisory services
exclusively to the Company. Details of the remuneration of the
Investment Manager are disclosed in the financial statements as at
and for the year ended 31 December 2022 . During the financial
period ended 30 June 2023 , management fee amounting to
US$5,320,000 (30 June 2022 : US$5,404,000) paid/payable to the
Investment Manager has been recognised in the condensed interim
financial statements.
Other than as disclosed elsewhere in the condensed interim
financial statements, there were no other significant related party
transactions during the 6 months periods ended 30 June 2023 and 30
June 2022 .
11 commitments
In September 2008, the Company entered into a loan agreement
with a joint venture, held via its unconsolidated subsidiary, to
grant loans totalling US$ 3,968,000 (THB140,000,000) . As at 30
June 2023 , US$3,401,000 (THB 120,000,000 ) (30 June 2022 : US$
3,399,000 ( THB120,000,000)) has been drawn down. The Company is
committed to grant the remaining loan amounting to US$567,000 (THB
20,000,000 ) (30 June 2022 : US$ 567,000 (THB 20,000,000)), subject
to terms set out in the agreement.
In July 2019, the Company committed to subscribe to Good Capital
Fund I for an amount less than 1% of the net asset value as at 30
June 2023. Approximately 78.08% of this commitment has been funded
at 30 June 2023 with 21.92% of the commitment subject to be
called.
In March 2023, the Company committed to subscribe to Good
Capital Fund II for an amount less than 2% of net asset value at 30
June 2023. None of this commitment was funded as at 30 June
2023.
The Company committed to incremental funding in Mavi Holding
Pte. Ltd. that is subject to certain milestones being achieved. The
total remaining contingent commitment amounts aggregate to less
than 1% of the net asset value as at 30 June 2023
In the general interests of the Company and its unconsolidated
subsidiaries, it is the Company's current policy to provide such
financial and other support to its group of companies to enable
them to continue to trade and to meet liabilities as they fall
due.
12 Subsequent events
Subsequent to 30 June 2023,
-- Symphony completed a follow-on investment in Mavi Holding
Pte. Ltd. The total consideration was less than 1% of NAV.
-- Symphony completed a follow-on investment in Smarten Spaces
Pte. Ltd. The total consideration was less than 1% of NAV.
-- Symphony funded capital calls related to Good Capital Fund I
and Good Capital Fund II. The total consideration was less than 1%
of NAV.
-- Symphony paid out ordinary dividends of US$ 0.025 per share
declared during the period ended 30 June 2023, resulting in a total
cash pay out of US$12,834,000 to shareholders of the Company.
-- Symphony received part of the proceeds related to the sale of
Creative Technology Solutions DMCC. The consideration was less than
1% of NAV
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END
IR NKPBKABKDQCB
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