TIDMWSL
RNS Number : 9009A
Worldsec Limited
27 September 2022
WORLDSEC LIMITED
Interim Report for the six months ended 30 June 2022
Worldsec Limited
Interim Report for the six months ended 30 June 2022
The board (the "Board") of directors of Worldsec Limited (the
"Company") hereby submits the interim report on the Company and its
subsidiaries (the "Group") for the six months ended 30 June 2022
(the "Interim Report").
For the period under review, the Group recorded a net loss of
US$526,000 (equivalent to basic and diluted loss per share of 0.62
US cent) against a net profit of US$7,000 (equivalent to basic and
diluted earnings per share of 0.01 US cent) for the corresponding
six months in 2021. The loss reflected a negative change in the
fair value of the Group's financial assets that was recognised
through the profit and loss account under International Financial
Reporting Standard 9.
During the period under review, the Group expanded its
investment portfolio with two new investments in the technology
sector:
(i) an investment through the subscription of the Class A
Participating Shares (the "VS Class A Shares") of VS SPC Limited
("VS SPC") established by LQ Pacific Partners Limited, in VS SPC,
the sole underlying investment asset of which is an equity interest
in Animoca Brands Corporation Limited ("Animoca"). The Animoca
group is principally engaged in the development and publication of
a broad portfolio of products that includes blockchain games.
(ii) an investment through the subscription of the Class A
Participating Shares (the "Hermitage Class A Shares") of the
Hermitage Galaxy Fund SPC attributable to the Hermitage Fund Twelve
SP (the "Hermitage Fund Twelve") established by Hermitage Capital
HK Limited, in the Hermitage Fund Twelve, the sole underlying
investment asset of which is an equity interest in Innovution
Holdings Ltd. ("Innovution"). The Innovusion group is principally
engaged in the development of image-grade light detection and
ranging ("LiDAR") sensor systems for the autonomous vehicle and
advance driver-assistance system markets.
At the date of the Interim Report, the investment portfolio of
the Group comprises a total of nine investments:
ICBC Specialised Ship Leasing Investment Fund (the "ICBC Ship
Fund")
The Group's investment in the ICBC Ship Fund, which is involved
in marine vessel leasing, continued to provide a stable return
through monthly dividend income generating revenue amounting to
US$48,000 for the six months ended 30 June 2022.
Animoca through VS SPC
Through the VS Class A Shares, the Group holds an investment in
VS SPC, the sole underlying investment asset of which is an equity
interest in Animoca.
Incorporated in Australia, Animoca is an unlisted holding
company of a technology group that uses gamification, blockchain
and artificial intelligence technologies to develop and publish a
broad portfolio of products that includes, notably among others,
The Sandbox, a decentralised gaming virtual world. Other key
business units of the Animoca group consist of GAMEE, nWay,
Blowfish Studios, Grease Monkey Games, REVV Motorsport, TOWER,
Quidd, Lympo, and Forj. Animoca is also an active investor in
crypto and blockchain-related projects with a broad portfolio of
more than 340 investments that includes OpenSea, a leading
non-fungible token marketplace.
Against the backdrop of a crypto downturn that saw the total
market value of cryptocurrencies losing trillion of US dollars
since late last year, the Animoca group continues to make
significant progress. According to an investor update published by
Animoca, unaudited bookings and income of the Animoca group
amounted to A$213 million (equivalent to US$148 million) for the
three months ended December 31 2021 and A$827 million (equivalent
to US$573 million) for the four months ended April 30 2022. As at
April 30 2022, the investment portfolio of Animoca was valued at
over A$2.2 billion (equivalent to US$1.5 billion). The Animoca
group also held digital assets in the form of various
cryptocurrencies and stablecoins totalling A$304 million
(equivalent to US$211 million) as well as other digital assets
including third party tokens totalling A$952 million (equivalent to
US$659 million).
Other recent business and management highlights of the Animoca
group include:
- the acquisition of Grease Monkey Games, Darewise, Eden Games,
Notre Game, Be Media and TinyTap to strengthen and expand its
gaming and Web3 capabilities;
- the development of significant partnerships with Yuga Labs,
Brinc, OneFootball, Planet Hollywood, Cube Entertainment and
Untamed Planet;
- the expansion of its presence in Japan through the
establishment of a strategic subsidiary, Animoca Brands KK;
- the participation in the distribution of security tokens to
professional investors in the first private security token offering
arranged by a digital asset broker licensed by the Securities and
Futures Commission in Hong Kong; and
- the appointment of a number of senior management personnel
including the chief business officer to lead mergers and
acquisitions and business development, a co-chief operating officer
to take charge of scaling initiatives and the chief financial
officer to oversee strategic financial planning.
In addition, The Sandbox, held through a major subsidiary of
Animoca that operates a decentralised gaming virtual world and that
has been ranked as one of the 2022 TIME100 Most Influential
Companies, has in recent months attracted a number of well-known
partners that include PwC Hong Kong, Warner Music Group, Ocean
Park, HSBC, MTR, Standard Chartered, PCCW-HKT, TIMEPieces, Planet
Hollywood, Playboy and Paris Hilton to enter its metaverse.
Meantime, notwithstanding the backdrop of the crypto downturn,
Animoca continues to close fund raising deals successfully. In July
2022, it raised another US$75 million at a valuation of US$5.9
billion in the second tranche of the funding round previously
announced in January 2022, which was extended to accommodate due
diligence process. In September 2022, Animoca issued convertible
notes to a small number of institutional investors, including
existing investors and a strategic consortium of new investors,
raising a further US$110 million to continue to fund acquisitions,
investments, product development and intellectual property
licensing. The conversion price, set at A$4.50 per share, valued
Animoca at a valuation similar to that of the previous funding
round. The consortium of new investors, formed by Temasek, Boyu
Capital and GGV Capital, will provide strategic advice and
perspectives to Animoca on organisational capabilities that will
include input on business and capital plans.
Innovusion through the Hermitage Fund Twelve
Through the Hermitage Class A Shares, the Group holds an
investment in the Hermitage Fund Twelve, the sole underlying
investment asset of which is an equity interest in Innovusion.
Innovusion is an unlisted holding company of a technology group
that is principally engaged in the development of image grade LiDAR
sensor systems for the autonomous vehicle and advance
driver-assistance system markets.
Over the years since founding in 2016, the Innovusion group has
successfully developed a portfolio of LiDAR products that includes,
among others, Falcon. A robust LiDAR with long-distance capability
of a detecting range of 500 metres, high angular resolution and
ease of customerisation and integration, Falcon has been selected
by Nio Inc. ("Nio"), one of Innovusion shareholders, to be
incorporated as the standard configuration for the ET7 model, the
new smart electric flagship sedan of Nio. Delivery of the first
batch of ET7s commenced in March 2022, signifying the beginning of
the mass production by the Innovusion group of Falcon that was
required for the assembly process to meet the March 2022 delivery
timeline. By the end of June 2022, more than 6,900 ET7 sedans had
been delivered. Riding on the strong demand for the ET7 model and
notwithstanding the supply chain challenges, the Innovusion group
managed to achieve rapid growth in revenue starting from a low
base. Constrained by the supply of casting parts, however, delivery
of ET7s slowed down in July 2022 but that was followed by a rebound
in August 2022. Furthermore, the ET7 model, having received
approval for sale in Europe, will become available in Norway,
Germany, the Netherlands, Denmark and Sweden before the end of the
year.
Apart from ET7, Falcon has also been selected to be incorporated
as the standard configuration for the two latest models of Nio,
ES7, a smart electric sport utility vehicle the shipment of which
commenced at the end of August 2022, and ET5, a mid-size smart
electric sedan the shipment of which is slated to commence in
September 2022. To cope with the anticipated business from Nio, a
second production line in Suzhou in the Jiangsu Province in China
is currently under construction and is expected to start production
in the fourth quarter of 2022.
As a leading developer of LiDAR sensor systems, the Innovusion
group continues to secure cooperation agreements with automotive
original equipment manufacturers and other partners. In May 2022,
Innovusion formed a strategic alliance with an autonomous
technology firm, TuSimple, to focus on exploring the integration of
the LiDARs of the Innovusion group into the self-driving trucks of
TuSimple under the unmanned port logistics and urban freight
transport scenarios with a view to accelerating the development and
large-scale adoption of driverless technology for heavy truck
freight in China.
With the rapid growth in revenue achieved by the Innovusion
group, Innovusion is in the process of preparing and working on the
Series D round of financing.
ByteDance through the Asset Management Master Fund SPC (the
"Homaer Fund")
Through the Unicorn Equity Investment Portfolio Class A Shares
of the Homaer Fund, the Group holds an investment in the Homaer
Fund, the sole underlying investment asset of which is an equity
interest in ByteDance Ltd. ("ByteDance").
ByteDance is an unlisted holding company of a technology group
that operates a series of mobile application platforms powered by
artificial intelligence across cultures and geographies. The
ByteDance group has a portfolio of products that is available in
over 150 markets and 75 languages and that includes Douyin,
Toutiao, TikTok, Xigua Video, Helo, Lark and BytePlus.
Following ByteDance's reorganisation of its group business into
six units, the Douyin business unit becomes responsible for the
overall development of the domestic information and services of the
ByteDance group that include Douyin, news aggregator Toutiao and
Xigua Video, among others. In addition, a number of the major
subsidiaries of ByteDance have also been renamed under Douyin. This
appears to reflect what might be an attempt on the part of the
ByteDance group to distinguish and delineate its domestic Douyin
business from its overseas activities in order to achieve
flexibility for any future corporate exercise under an increasingly
complex international regulatory environment.
Meantime, with over 600 million daily active users and through
the use of short videos and livestreaming, Douyin has developed a
highly popular e-commerce ecosystem. Since the proposal in April
2021 of the concept of interest e-commerce that utilises
algorithm-based interest recommendation technology to connect
consumers with merchandise, Douyin had achieved strong growth in
online sales reporting a 320% surge in gross merchandise value
selling more than 10 billion items of products in the twelve months
through to April 2022. TikTok, the international version of Douyin,
has also been working to integrate the e-commerce feature into its
short video sharing platform. TikTok Shop was initially launched in
Indonesia and the United Kingdom in early 2021 and has subsequently
been expanded to Vietnam, Thailand, Philippines, Malaysia and
Singapore. Tiktok, however, appears to have decided to stop
expanding the shopping feature for the European and North American
markets after experiencing cultural conflicts, low traffic and
insufficient sales in the United Kingdom. On the other hand, TikTok
is testing a shopping-specific feed in Indonesia and has recently
launched new online shopping campaigns in Malaysia and
Singapore.
To expand its portfolio of hardware, platforms and content for
the metaverse, ByteDance acquired Beijing PoliQ Technology Ltd.
("PoliQ") in June 2022. PoliQ, a Chinese virtual reality startup
that has developed a two-dimensional virtual character
customisation system, would be integrated into Pico Interactive,
Inc., a virtualisation solution provider and equipment manufacturer
that was acquired by ByteDance in August 2021. Earlier in the year,
ByteDance also announced a partnership with Qualcomm to collaborate
on extended reality hardware, software and technology.
In August 2022, ByteDance's healthcare unit, Xiaohe Health
Technology (Hong Kong) Limited, completed the acquisition of the
remaining 69.5% equity interest to take full control of Beijing
Amcare Medical Management Co. Ltd. ("Amcare") for about US$1.5
billion as part of the ByteDance group's continued expansion into
the health technology sector. Amcare, one of the largest private
hospital chains in China, was founded in 2006 and offers
comprehensive services in obstetrics, gynecology, pediatrics,
assisted reproduction, postpartum rehabilitation, postpartum
recuperation and medical beauty. It has a total of seven women's
and children's hospitals, two outpatient centres and five
post-partum confinement centres covering the Beijing-Tianjin-Hebei,
Yangtze River Delta and Pearl River Delta regions in China.
While ByteDance is not among the most valuable global brands, it
was ranked as the number one Chinese Global Brand Builder on the
2022 Kantar BrandZ list and has over the years demonstrated notable
success in the brand building of Douyin and TikTok.
Dingdong (Cayman) Limited ("Dingdong")
Following the distribution of the American depositary shares of
Dingdong (the "Dingdong ADS") by Cambium Grove Growth Opps IV
Limited ("Cambium Opps") to the holders of the Class B Ordinary
Shares of Cambium Opps upon the expiry of the lock-up period
associated with initial public offering of Dingdong, the Group
directly holds its investment in the the Dingdong ADS.
Listed on the New York Stock Exchange, Dingdong is the holding
company of an on-demand e-commerce group that operates a mobile
application platform, Dingdong Fresh, providing users with fresh
produce, meat, seafood, prepared food and other food products
supported by a self-operated frontline fulfillment grid. The
operations of the Dingdong group cover 28 cities across China
including Beijing, Shanghai, Shenzhen and Guangzhou.
According to the unaudited financial information published by
Dingdong, the Dingdong group achieved revenue of RMB5.4 billion and
RMB6.6 billion for the first and second quarters of 2022,
representing year-on-year growth of 43.1% and 42.8% respectively.
The strong revenue growth was primarily driven by an increase in
the number of orders and an increase in the average order value.
Consequent of Dingdong's shift in strategy in the latter part of
last year to focus on developing product capabilities and improving
operation efficiency, gross profit margin rose and f ulfillment
expenses as a percentage of revenue fell leading to a sharp drop in
net loss from RMB2.0 billion and RMB1.1 billion in the third and
fourth quarters of 2021 to RMB477 million and RMB35 million in the
first and second quarters of 2022 respectively. The Dingdong group
was also able to generate positive cash flows from operating
activities amounting to RMB218 million during the three months
through to June 2022.
With rapidly improving financial performance and outlook and
having been selected by the local government as one of the
essential entities to ensure delivery of daily supplies when a
city-wide COVID-19 lockdown was imposed in Shanghai earlier in the
year, the Dingdong group managed to gain increased support and
secure increased credit limits from banking institutions. This was
reflected by an increase of RMB878 million in short term borrowings
to RMB4.1 billion during the second quarter of 2022.
In a move to prioritise markets with good profit potential,
Dingdong has recently decided to discontinue its services in a
number of lower-tier Chinese cities. This is consistent with
Dingdong's strategic focus on developing product capabilities and
improving operation efficiency which has since having been
implemented in the latter part of last year led to remarkable
results as evidenced by the sharp sequential narrowing in non-GAAP
net loss margin from 31.9%, 18.9%, 7.8% to 0.3% in the four
quarters through to June 2022. The Dingdong group appears to have
found the path to profitability and expects to achieve a
single-month non-GAAP breakeven by the end of the year.
Originating from China and listed in the United States, Dingdong
is one of many such companies that has been identified by the U.S.
Securities and Exchange Commission (the "Commission-Identified
Companies") under the Holding Foreign Companies Accountable Act
(the "HFCAA") with a potential risk of delisting should the
inspection requirement for the auditor it retains not be met for
three consecutive years. Coupled with the continued repricing that
the Chinese technology stocks have been undergoing, and
notwithstanding the rapidly improving financial performance and
outlook of the Dingdong group, the price of the Dingdong ADS has
remained under pressure. An impairment in the carrying value of the
Group's investment in the Dingdong ADS has accordingly been
recognised in the interim financial statements of the Group for the
six months ended 30 June 2022.
Subsequently, in August 2022, the Chinese authorities and the
Public Company Accounting Oversight Board of the United States (the
"U.S, PCAOB") reached a statement of protocol regarding the
cooperation on auditor inspections and investigations. A framework
to enable the U.S. PCAOB to inspect and investigate audit firms
based in China has been established. This could provide the basis
and opportunity for the Commission-Identified Companies to fulfill
the auditor inspection requirement under the HFCAA leading
eventually to the removal of an overhang that has been a major drag
on the share price of such companies.
Velocity Mobile Limited ("Velocity")
Velocity, an unlisted investee company of the Group, is the
holding company of a technology group that operates a lifestyle
mobile e-commerce platform targeting premium consumers with
services focusing on the sectors of high-end travel, experiences
and luxury goods.
Having effectively minimised the early shock and negative impact
of the COVID-19 pandemic, the Velocity group has resumed its growth
trajectory. The proprietary concierge automation software, Gravity,
continues to improve operation efficiency and productivity. This
has driven transactional gross profit per Velocity Black user to a
record high. Velocity Black, the consumer product of the Velocity
group, continues to attract new members and there is a waiting list
for the membership. Likewise, the number of users under Velocity
for Business, the enterprise product of the Velocity group,
continues to grow as contracts that have been entered into
following delays because of the COVID-19 pandemic are making
meaningful contribution. To better capitalise on the growing user
base that has a high elastic capacity to spend and to inspire
spending, the Velocity group plans to increase investments in
content, implement innovative content interfaces and integrate
additional third-party API (Application Programming Interface)
libraries into its system and platform. It has also launched a
fully integrated SDK (Software Development Kit) product with a
financial
technology customer, enabling other companies to integrate the
capabilities of the Velocity group into their own mobile
experience.
Oasis Education Group Limited ("Oasis Group")
Oasis Group is a 50% joint venture of the Group. The operating
subsidiary of Oasis Group, Oasis Education Consulting (Shenzhen)
Company Limited ("Oasis Shenzhen", ( ) ), provides consulting and
support services to the Huizhou Kindergarten in the Guangdong
Province in China.
In the summer of 2022, the Huizhou Kindergarten graduated 56
pupils. Since then, it has attracted a record number of new pupils
to enrol thus bringing the total pupil enrolment to more than 300.
The increase in total pupil enrolment is expected to have a
positive impact on the cash flow position of the Huizhou
Kindergarten.
In an effort to encourage pupils to participate in sufficient
physical activities and develop healthy physical activity habits,
the Huizhou Kindergarten has recently renovated its outdoor
playground.
Agrios Global Holdings Ltd. ("Agrios")
Agrios, an investee company of the Group previously listed on
the Canadian Securities Exchange, used to be the holding company of
a data analytics driven agriculture technology and service group
that owned, leased and managed properties and equipment for
eco-sustainable agronomy and provided advisory services for
aeroponic cultivation to the cannabis industry.
As mentioned in the Company's 2021 Annual Report, a group of
Asian-based Agrios shareholders applied in January 2022 to a
Canadian court to appoint three new directors to the board of
Agrios (the "New Agrios Directors"). The New Agrios Directors have
subsequently instructed a Canadian law firm to write to and notify
the British Columbia Securities Commission (the "BCSC") that there
might have been misconduct on the part of the previous Agrios
board. In response having taken into account of the situation, the
BCSC has indicated that consideration may be given to the
re-listing of Agrios shares on the Canadian Securities Exchange
depending on the outcome of any further development.
Investigations into the affairs of the Agrios group by the New
Agrios Directors and the group of Asian-based Agrios shareholders
suggested that the previous Agrios board might have improperly
transferred almost all of the Agrios group's assets to the former
chief executive officer of Agrios leaving the Agrios group in a
dire financial position.
In September 2022, a lawsuit was filed by a U.S. law firm on
behalf of Agrios in Washington in the United States where the
cultivation and processing facility of the Agrios group was
previously located. The lawsuit alleges breaches of fiduciary duty
against Agrios's former chairman and chief executive officer for
unlawfully taking the Agrios group's property and business, which
was worth in excess of US$30 million.
The Group's investment in Agrios had been completely written off
in its financial statements for the year ended 31 December
2020.
Ayondo Ltd. ("Ayondo")
Ayondo, an investee company of the Group previously listed on
the Catalist of the Singapore Exchange, used to be the holding
company of a financial technology group that focused on social
trading activities.
As mentioned in the Company's 2021 Annual Report, subsequent to
the delisting of Ayondo shares from the Catalist of the Singapore
Exchange, the directors of Ayondo filed an application with the
High Court of the Republic of Singapore to wind up Ayondo and
liquidators were appointed on 28 January 2022 to pursue the winding
up proceedings. According to the notice issued by the liquidators
on 24 February 2022, the assets of Ayondo were insufficient to
repay liabilities and as such there would not be any surplus assets
available for Ayondo shareholders.
The Group's investment in Ayondo had been completely written off
in its financial statements for the year ended 31 December
2020.
PROSPECTS
Following more than two years of the COVID-19 pandemic which has
caused huge disruptions in global trades, the world economy is
again facing major difficulties. The start of the Russia-Ukraine
war in February this year has amplified the supply chain problems
and, subsequently, the emergence of high inflation, rising interest
rates and worsening geopolitics means that world economic growth in
2022 will be substantially reduced from that of last year. The 2022
global growth estimate by the International Monetary Fund has been
revised downward by some 27% from 4.4% at the beginning of the year
to the latest level of 3.2%, down substantially from 6.1% in 2021.
Higher energy and food prices have taken a toll on the living
standards particularly of the middle and low income groups.
With growing wariness of risks such as high inflation, rising
interest rates and increasing financing costs as well as uncertain
economic outlook, many private equity firms have adopted a more
cautious stance and approach in their due diligence and valuation
processes when making new investment decisions. According to one of
the industry sources, the number of private equity transactions
declined by about 26% in the first half of 2022, as compared to the
previous corresponding period, and the slowdown is expected to
continue in the second half of the year. However, given the ample
amount of dry powder that has been accumulated and is readily
deployable, private equity activities are expected to recover
markedly once inflation is brought under control and economic
outlook improves. Sector-wise, information technology, especially
software and services, remains the top industry choice followed by
healthcare, consumer and industrials.
Unlike the governments of other major economies which have been
facing rising inflation and where government budget has been
stretched by the COVID-19 pandemic, the Chinese government, with
the fiscal wherewithal under a relatively tame inflationary
environment, has recently launched stimulus measures totalling one
trillion Renminbi to boost domestic economic activities in the wake
of the renewed lockdowns following fresh outbreaks of the Omicron
variants in various areas across the country. Through the channels
of state banks, provincial governments and energy firms, these
targeted stimulus measures aim to provide support particularly to
the infrastructure, property and private business sectors. Among
the Group's underlying investment assets, ByteDance, Innovusion,
Dingdong and Oasis Group are expected to benefit from these
measures as their operations are mainly China-focused. Meantime,
the ICBC Ship Fund will continue to provide stable dividend income
to the Group, while Velocity and Animoca are expected to further
develop their business through the expansion in its user base and
its crypto and blockchain-related investments respectively.
However, due to the unstable investment environment worldwide,
apart from the stable dividend income from the ICBC Ship Fund and
any movements in fair value, the underlying investment assets of
the Group are unlikely to make any contributions to the Group's
results in any meaning way in the near term.
By order of the Board
Alastair GUNN-FORBES
Non-Executive Chairman
27 September 2022
PRINCIPAL RISKS AND UNCERTAINTIES
The Group is exposed to a number of principal risks and
uncertainties that could materially and adversely affect its
performance for the remaining six months of the year ending 31
December 2022 and beyond. Such risks and uncertainties, the
directors believe, remain largely unchanged from those, including,
in particular, target market risk, key person risk, operational
risks and financial risks, set out on pages 13 and 14 of the
Company's 2021 Annual Report.
RESPONSIBILITY STATEMENT
The Board, comprising Alastair GUNN-FORBES, Henry Ying Chew
CHEONG, Ernest Chiu Shun SHE, Mark Chung FONG, Martyn Stuart WELLS
and Stephen Lister d'Anyers WILLIS, confirms to the best of its
knowledge and understanding that:
(a) the unaudited consolidated financial statements of the Group
for the six months ended 30 June 2022 have been prepared in
accordance with International Accounting Standard 34 as adopted by
the European Union and give a true and fair view of its assets,
liabilities and financial position at that date and its financial
performance for the period then ended; and
(b) the Interim Report includes a fair review of the
information, such as important events and related party
transactions that took place during the six months ended 30 June
2022, that is required by Disclosure Guidance and Transparency
Rules 4.2.7R and 4.2.8R.
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE
INCOME
FOR THE SIX MONTHSED 30 JUNE 2022
Unaudited
Six months ended
Notes 30.6.2022 30.6.2021
US$'000 US$'000
Revenue 4 59 50
Other income, gains and losses, net 5 (278) 242
Staff costs 7 (131) (149)
Other expenses (173) (128)
Finance costs 8 (2) (4)
Share of losses of a joint venture (1) (4)
---------- ------------
(Loss)/profit before income tax expense (526) 7
Income tax expense 9 - -
---------- ------------
(Loss)/profit for the period (526) 7
========== ============
Other comprehensive income, net of income tax
Exchange differences on translating foreign operations - -
Other comprehensive income for the period,
net of income tax - -
---------- ------------
Total comprehensive (loss)/income for the period (526) 7
========== ============
(Loss)/profit for the period attributable to:
Owners of the Company (526) 7
========== ============
Total comprehensive (loss)/income for the period attributable to:
Owners of the Company (526) 7
========== ============
(Loss)/earnings per share - basic 10 US(0.62) US0.01 cent
cent
========== ============
(Loss)/earnings per share - diluted 10 US(0.62) US0.01 cent
cent
ce
cent
========== ============
The accompanying notes form an integral part of these interim
financial statements.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AT 30 JUNE 2022
Unaudited Audited
As at As at
Notes 30.6.2022 31.12.2021
US$'000 US$'000
Non-current assets
Right-of-use assets 79 111
Interest in a joint venture 99 100
Financial assets at fair value through profit or loss 4,506 3,849
4,684 4,060
---------- -----------
Current assets
Other receivables 24 114
Deposits and prepayments 27 26
Financial assets at fair value through profit or loss 267 624
Amount due from a joint venture 257 257
Cash and cash equivalents 702 1,513
---------- -----------
1,277 2,534
---------- -----------
Current liabilities
Other payables and accruals 91 163
Lease liabilities 66 64
---------- -----------
157 227
---------- -----------
Net current assets 1,120 2,307
---------- -----------
Non-current liabilities
Lease liabilities 18 55
---------- -----------
Net assets 5,786 6,312
========== ===========
Capital and reserves
Share capital 11 85 85
Reserves 5,701 6,227
---------- -----------
Total equity 5,786 6,312
========== ===========
The accompanying notes form an integral part of these interim
financial statements.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTHSED 30 JUNE 2022
Foreign
Contri- Share currency Accumu-
Share Share buted option translation Special lated
capital premium surplus reserve reserve reserve losses Total
US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
Balance as
at 1 January
2021 85 7,524 9,646 249 (17) 625 (12,447) 5,665
Loss and total
comprehensive
loss for the
period - - - - - - 7 7
Balance as
at 30 June
2021 (Unaudited) 85 7,524 9,646 249 (17) 625 (12,440) 5,672
======= ======= ======= ======= =========== ======= ======== =======
Balance as at 1 January
2022 85 7,524 9,646 249 (6) 625 (11,811) 6,312
Profit and total comprehensive
income for the period - - - - - - (526) (526)
Balance as at 30 June
2022 (Unaudited) 85 7,524 9,646 249 (6) 625 (12,337) 5,786
=== ====== ====== === === === ======== =====
The accompanying notes form an integral part of these interim
financial statements.
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE SIX MONTHSED 30 JUNE 2022
Unaudited
Six months ended
30.6.2022 30.6.2021
US$'000 US$'000
Cash flows from operating activities
(Loss)/profit for the period (526) 7
Adjustments for:
Depreciation of right-of-use assets 32 32
Interest expense 2 4
Share of losses of a joint venture 1 4
Loss/(gain)on disposal of financial assets at fair value through 20 (38)
profit or loss 270 (207)
Change in fair value of financial assets at fair value through profit or loss
---------- ----------
Operating loss before working capital changes (201) (198)
(Increase)/decrease in deposits and prepayments (1) 1
Decrease in other receivables 90 144
Decrease in other payables and accruals (72) (100)
---------- ----------
Net cash used in operating activities (184) (153)
---------- ----------
Cash flows from investing activities
Investment in financial assets at fair value through
profit or loss (1,188) (752)
Proceeds from disposal of financial assets at fair value through
profit or loss 598 809
Net cash (used in) / from investing activities (590) 57
---------- ----------
Cash flows from financing activities
Repayment of principal portion of lease liabilities (35) (33)
Repayment of interest portion of lease liabilities (2) (4)
---------- ----------
Net cash used in financing activities (37) (37)
---------- ----------
Net decrease in cash and cash equivalents (811) (133)
Cash and cash equivalents at beginning of the period 1,513 1,194
Effects of exchange rate changes - -
Cash and cash equivalents at end of the period
Cash and bank balances 702 1,061
========== ==========
The accompanying notes form an integral part of these interim
financial statements.
NOTES TO THE INTERIM FINANCIAL STATEMENTS
FOR THE SIX MONTHSED 30 JUNE 2022
1. GENERAL INFORMATION
The Company is an exempted company incorporated in Bermuda and
has a premium listing on the Main Market of the London Stock
Exchange. The addresses of the registered office and principal
place of business of the Company are disclosed in the corporate
information in the Interim Report.
2. BASIS OF PREPARATION
This unaudited consolidated financial statements of the Company
and its subsidiaries (the "Group") for the six months ended 30 June
2022 (the "Interim Financial Statements") have been prepared in
accordance with International Accounting Standard 34 ("IAS 34")
issued by the International Accounting Standards Board as adopted
by the European Union (the "EU").
The Interim Financial Statements do not include all of the
information required in annual financial statements in accordance
with International Financial Reporting Standards ("IFRS"),
International Accounting Standards ("IAS"), Interpretations adopted
by the EU, Interpretations adopted by the International Financial
Reporting Interpretations Committee and Interpretations adopted by
the Standing Interpretations Committee (collectively referred to as
"IFRSs"), and should be read in conjunction with the annual
financial statements of the Group for the year ended 31 December
2021. The Interim Financial Statements have neither been audited
nor reviewed by the Group's auditor.
Save for the adoption of the amendments to IFRSs as described in
note 3 to the Interim Financial Statements, which became effective
for the Group's financial year that began on 1 January 2022, the
accounting policies adopted in the Interim Financial Statements
were consistent with those used in the preparation of the Group's
annual financial statements for the year ended 31 December
2021.
The Interim Financial Statements have been prepared on a going
concern basis using the historical cost conversion, except for
certain financial instruments which were stated at fair value as
appropriate.
The preparation of the Interim Financial Statements in
conformity with IAS 34 as adopted by the EU required management to
make judgments, estimates and assumptions that could affect the
application of accounting policies and reported amounts of assets,
liabilities, income and expenses on a year to date basis. Actual
results might differ from these estimates.
3. ADOPTION OF NEW AND REVISED IFRSs
The Group has applied the same accounting policies in the
Interim Financial Statements as in its annual financial statements
for the year ended 31 December 2021, except that it has adopted the
following amendments to IFRSs:
Amendments to IFRS Standards Annual Improvements to IFRS Standards
2018-2020
Amendments to IFRS 3 Reference to the Conceptual Framework
Amendments to IAS 16 Property, Plant and Equipment: Proceeds
before Intended Use
Amendments to IAS 37 Onerous Contracts - Costs of Fulfilling
a Contract
The application of the above amendments to IFRSs in the current
interim period had no material effect on the amounts reported
and/or disclosures set out in the Interim Financial Statements.
NOTES TO THE INTERIM FINANCIAL STATEMENTS
FOR THE SIX MONTHSED 30 JUNE 2022
4. REVENUE
The Group's revenue represented dividend income from financial
assets at fair value through profit or loss for the periods ended
30 June 2022 and 2021, an analysis of which is as follows:
Unaudited
Six months ended
30.6.2022 30.6.2021
US$'000 US$'000
Dividend income from financial assets
at fair value through profit or loss 59 50
========== ==========
5. OTHER INCOME , GAINS AND LOSSES , NET
Unaudited
Six months ended
30.6.2022 30.6.2021
US$'000 US$'000
(Loss)/gain on disposal of financial
assets at fair value through profit
or loss (20) 38
Change in fair value of financial
assets at fair value through profit
or loss (270) 207
Foreign exchange gain/(loss), net 6 (3)
Other 6 -
---------- ----------
(278) 242
========== ==========
6. BUSINESS AND GEOGRAPHICAL SEGMENTS
No business and geographical segment analyses are presented for
the periods ended 30 June 2022 and 2021 as the major operations and
revenue of the Group arose from Hong Kong. The Board considers that
most of the Group's non-current assets (other than the financial
instruments) were located in Hong Kong.
7. STAFF COSTS
The aggregate staff costs (including directors' remuneration)
of the Group were as follows:
Unaudited
Six months ended
30.6.2022 30.6.2021
US$'000 US$'000
Wages and salaries 128 146
Contributions to pension and provident
fund 3 3
----------- ----------
131 149
=========== ==========
NOTES TO THE INTERIM FINANCIAL STATEMENTS
FOR THE SIX MONTHSED 30 JUNE 2022
7. STAFF COSTS (CONTINUED)
Key management personnel of the Company are the directors
only.
The directors' remuneration was as
follows:
Unaudited
Six months ended
30.6.2022 30.6.2021
US$'000 US$'000
Directors' fees 36 42
Other remuneration including contributions - -
to pension and provident fund
36 42
========== ==========
8. FINANCE COSTS
Unaudited
Six months ended
30.6.2022 30.6.2021
US$'000 US$'000
Interest on lease liabilities 2 4
========== ==========
9. INCOME TAX EXPENSE
No provision for taxation has been made as the Group did not
generate any assessable profits for United Kingdom Corporation Tax,
Hong Kong Profits Tax or tax in other jurisdictions during the
periods ended 30 June 2022 and 2021.
10. (LOSS)/EARNINGS PER SHARE
The (loss)/earnings and weighted average number of ordinary
shares used in the calculation of basic and diluted (loss)/earnings
per share were as follows.
Unaudited
Six months ended
30.6.2022 30.6.2021
(Loss)/earnings for the period attributable
to owners of the Company (US$'000) (526) 7
============ ============
Weighted average number of ordinary
shares for the purposes of basic and
diluted (loss)/earnings per share 85,101,870 85,101,870
Effect of potential dilutive ordinary
shares:
* Share options - 2,050,000
------------ ------------
85,101,870 87,151,870
============ ============
(Loss)/earnings per share - basic US(0.62) US0.01 cent
cent
============ ============
(Loss)/earnings per share - diluted US(0.62) US0.01 cent
cent
============ ============
NOTES TO THE INTERIM FINANCIAL STATEMENTS
FOR THE SIX MONTHSED 30 JUNE 2022
10. (LOSS)/EARNINGS PER SHARE (CONTINUED)
Diluted loss per share was the same as basic loss per share for
the six months ended 30 June 2022 as the impact of the potential
dilutive ordinary shares outstanding had an anti-dilutive effect on
the basic loss per share presented for the six months ended 30 June
2022.
11. SHARE CAPITAL
Number of Total value
shares US$'000
Authorised:
Ordinary shares of US$0.001 each
As at 1 January 2021, 31 December
2021, 1 January 2022 and
30 June 2022 60,000,000,000 60,000
================ ============
Called up, issued and fully paid:
Ordinary shares of US$0.001 each
As at 1 January 2021, 31 December
2021, and 1 January 2022 and 30 June
2022 85,101,870 85
================ ============
12. RELATED PARTY TRANSACTIONS
Other than the compensation of key management personnel
disclosed below, the Group did not have any related party
transactions during the six months ended 30 June 2022 and 2021.
Compensation of key management personnel
The remuneration of directors is set out in note 7 to the
Interim Financial Statements.
13. CONTINGENT LIABILITIES
The Group had no material contingent liabilities at 30 June 2022
and 31 December 2021.
14. INTERIM REPORT
The Interim Report was approved and authorised for issue by the
Board on 27 September 2022.
CORPORATE INFORMATION
Board of Directors
Non-Executive Chairman
Alastair GUNN-FORBES*
Executive Directors
Henry Ying Chew CHEONG (Deputy Chairman)
Ernest Chiu Shun SHE
Non-Executive Directors
Mark Chung FONG*
Martyn Stuart WELLS*
Stephen Lister d'Anyers WILLIS*
* independent
Company Secretary
Vistra Company Secretaries Limited
First Floor, Templeback, 10 Temple Back, Bristol BS1 6FL, United
Kingdom
Assistant Company Secretary
Ocorian Services (Bermuda) Limited
Victoria Place, 5th Floor, 31 Victoria Street, Hamilton HM 10,
Bermuda
Registered Office Address
Victoria Place, 5th Floor, 31 Victoria Street, Hamilton HM 10,
Bermuda
Registration Number
EC21466 Bermuda
Principal Banker
The Hongkong and Shanghai Banking Corporation Limited
1 Queen's Road, Central, Hong Kong
External Auditor
BDO Limited
25(th) Floor, Wing On Centre, 111 Connaught Road Central, Hong
Kong
Principal Share Registrar and Transfer Office
Ocorian Management (Bermuda) Limited
Victoria Place, 5th Floor, 31 Victoria Street, Hamilton HM 10,
Bermuda
International Branch Registrar
Link Market Services (Jersey) Limited
12 Castle Street, St Helier, Jersey, JE2 3RT, Channel
Islands
United Kingdom Transfer Agent
Link Group
10(th) Floor, Central Square, 29 Wellington Street, Leeds, LS1
4DL, United Kingdom
Investor Relations
For further information about Worldsec Limited, please
contact:
Henry Ying Chew CHEONG, Executive Director
Worldsec Group
Unit 607, 6th Floor, FWD Financial Centre, 308 Des Voeux Road
Street, Central, Sheung Wan, Hong Kong
enquiry@worldsec.com
Company's Website
http://www.worldsec.com
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END
IR BKOBBABKDACB
(END) Dow Jones Newswires
September 27, 2022 12:38 ET (16:38 GMT)
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