17:00 Fri 22 Sep 2017
Adamas Fin Asia Ltd - Interim Results For Six Months End 30 June 2017
(AIM: ADAM)
("
Interim Consolidated Results for the six months ended
Repositioning to deliver long-term capital and income growth
· Net loss of
· Unrealised fair value gain on asset portfolio of
· Consolidated loss per share of
· Consolidated NAV at
· Major disposal of legacy asset generating over
· Appointment of
· Shareholder approval of changes to Investing Policy
Chairman of
"As mentioned at the time of our 2016 final results in June, we have plans to strengthen the Board with some new key appointments. I was therefore delighted to announce the appointment of Hugh,
"I am confident, with our new strategy and Investment Manager in place, that we will be able to announce further progress during the remainder of 2017."
Enquiries:
|
+44 (0) 1825 830587 |
|
||||
|
|
|
||||
Nominated Adviser |
|
|
||||
|
|
+44 (0) 113 394 6600 |
||||
|
|
|
||||
|
Broker finnCap Limited |
+44 (0) 20 7220 0500 |
||||
|
|
|
||||
|
|
|
||||
|
|
|
||||
|
Public Relations Advisers |
|
||||
|
|
+44 (0) 20 7466 5000 |
||||
About
ADAM is a
ADAM aims to provide uncorrelated returns through a combination of capital growth and dividend income from a broad spectrum of national geographies and asset classes.
The Company's recently appointed investment manager
Chairman's Statement
The first half of 2017 can be characterised as one of significant change for the Company, which included the disposal of the
Financial results for the period continued to show losses driven primarily by operating costs, with net portfolio asset valuations remaining broadly neutral.
The major changes in portfolio asset valuations as compared with
· The disposal of the
· Post the period end, the Company announced the disposal of the interest in Global Pharm for a cash consideration of
· As at
The principal assets as at
Current portfolio
Principal Assets |
Effective Interest |
Instrument type |
Valuation as at US$ million |
|
|
|
|
|
|
|
|
Global Pharm Holdings Group Inc. |
- |
Redeemable convertible bond |
15.6 |
|
|
|
|
|
- |
Interest bearing loan |
11.5 |
|
|
|
|
|
10.95% |
Structured equity |
8.7 |
|
|
|
|
|
7.9% |
Redeemable convertible preference shares
|
8.2
|
GCCF Investment Fund
Listed Securities
Other Investments |
-
-
-
|
|
2.7
3.4
10.2 |
Cash |
- |
|
15.0 |
|
|
|
|
|
|
|
75.4 |
Investment Manager Appointment
During the reporting period, we announced the appointment of a new, highly-experienced Investment Manager,
Mr. Withana was most recently Global Head of Special Situations and Co-Head of Asia at
In addition to the appointment of a new Investment Manager, the shareholders recently approved amendments to the Investing Policy which is intended to broaden ADAM's activities and provide more flexibility for the Manager to build a portfolio of investments producing income and capital gains. These two significant recent changes have provided us with a much firmer and more positive platform from which to grow the business.
Board Appointment
As mentioned at the time of our 2016 final results, we also have plans to strengthen the Board with some key new appointments. I was therefore delighted to have been able to announce the appointment of Hugh, Viscount Trenchard to the Board shortly after our final results announcement. Hugh brings a wealth of experience of the region and a wide network of contacts, as well as insights that will help shape the Company's investment strategy and development in the future.
Outlook
Our objectives are now clearly focused on providing our shareholders with access to income generating and capital growth opportunities throughout Asia. With a new Investment Manager in place, I am confident we can build a strong and diverse pan-Asian focused portfolio, whilst generating cash from the sale of legacy holdings.
Asset disposals announced during 2017 will, subject to completion of the Global Pharm disposal, generate in excess of
John Croft
Chairman
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
|
|
|
|
Six months ended |
|
Year ended |
|
||
|
|
Note |
|
30 June 2017 Unaudited |
|
Unaudited |
|
31 December 2016 Audited |
|
|
|
|
|
|
|
|
|
|
|
Realised gain on disposal of investments |
|
|
|
- |
|
5 |
|
5 |
|
Fair value changes on financial assets at fair value through profit or loss |
|
|
|
337 |
|
280 |
|
(34,094) |
|
Loan Written Off |
|
|
|
- |
|
- |
|
(2,238) |
|
Administrative expenses |
|
|
|
(1,435) |
|
(1,075) |
|
(1,948) |
|
|
|
|
|
|
|
|
|
|
|
Operating Loss |
|
|
|
(1,098) |
|
(790) |
|
(38,275) |
|
|
|
|
|
|
|
|
|
|
|
Net finance income / (expense) |
|
|
|
40 |
|
136 |
|
(18) |
|
Dividend income |
|
|
|
- |
|
200 |
|
911 |
|
Other income |
|
|
|
28 |
|
- |
|
220 |
|
|
|
|
|
|
|
|
|
|
|
Loss before taxation |
|
|
|
(1,030) |
|
(454) |
|
(37,162) |
|
Taxation |
|
5 |
|
- |
|
- |
|
- |
|
|
|
|
|
|
|
|
|
|
|
Loss for the period |
|
|
|
(1,030) |
|
(454) |
|
(37,162) |
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive loss for the period |
|
|
|
(1,030) |
|
(454) |
|
(37,162) |
|
|
|
|
|
|
|
|
|
|
|
Loss per share |
|
7 |
|
|
|
|
|
|
|
Basic |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The results above relate to continuing operations.
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
|
|
Note |
|
30 June 2017 Unaudited |
|
30 June 2016 Unaudited |
|
31 December 2016 Audited |
|
Assets |
|
|
|
|
|
|
|
|
|
Unquoted financial assets at fair value through profit or loss |
|
8 |
|
60,344 |
|
110,091 |
|
75,044 |
|
Loans and other receivables |
|
|
|
1,455 |
|
3,749 |
|
1,514 |
|
Cash and cash equivalents |
|
|
|
15,025 |
|
869 |
|
1,308 |
|
Total assets |
|
|
|
76,824 |
|
114,709 |
|
77,866 |
|
|
|
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
|
|
|
Loan payables and interest payables |
|
|
|
- |
|
- |
|
|
|
Other payables and accruals |
|
|
|
65 |
|
211 |
|
77 |
|
Total liabilities |
|
|
|
65 |
|
211 |
|
77 |
|
|
|
|
|
|
|
|
|
|
|
Net assets |
|
|
|
76,759 |
|
114,498 |
|
77,789 |
|
|
|
|
|
|
|
|
|
|
|
Equity and reserves |
|
|
|
|
|
|
|
|
|
Share capital |
|
9 |
|
129,543 |
|
129,543 |
|
129,543 |
|
Share based payment reserve |
|
|
|
- |
|
1 |
|
- |
|
Accumulated losses |
|
|
|
(52,784) |
|
(15,046) |
|
(51,754) |
|
Total equity and reserves attributable to owners of the parent |
|
|
|
76,759 |
|
114,498 |
|
77,789 |
|
|
|
|
|
|
|
|
|
|
|
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
|
|
Share capital |
|
Share based payment reserve |
|
Foreign translation reserve |
|
Accumulated losses |
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Group balance at |
|
129,543 |
|
1 |
|
- |
|
(14,592) |
|
114,952 |
|
Loss for the period |
|
- |
|
- |
|
- |
|
(454) |
|
(454) |
|
Other comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive expense for the period |
|
- |
|
- |
|
- |
|
(454) |
|
(454) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Group balance at |
|
129,543 |
|
1 |
|
- |
|
(15,046) |
|
114,498 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss for the period |
|
- |
|
- |
|
- |
|
(36,708) |
|
(36,708) |
|
Other comprehensive income |
|
- |
|
- |
|
- |
|
- |
|
- |
|
Total comprehensive expense for the period |
|
- |
|
- |
|
- |
|
(36,708) |
|
(36,708) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Share-based payments |
|
- |
|
(1) |
|
- |
|
- |
|
(1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Group balance at |
|
129,543 |
|
- |
|
- |
|
(51,754) |
|
77,789 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss for the period |
|
- |
|
- |
|
- |
|
(1,030) |
|
(1,030) |
|
Other comprehensive income |
|
- |
|
- |
|
- |
|
- |
|
- |
|
Total comprehensive expense for the period |
|
- |
|
- |
|
- |
|
(1,030) |
|
(1,030) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Group balance at |
|
129,543 |
|
- |
|
- |
|
(52,784) |
|
76,759 |
|
|
|
|
|
|
|
|
|
|
|
|
|
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
|
|
Six months ended |
|
Year ended |
|
||
|
|
30-Jun 2017 Unaudited US$'000 |
|
30-Jun 2016 Unaudited US$'000 |
|
31 December 2016 Audited US$'000 |
|
Cash flow from operating activities |
|
|
|
|
|
|
|
Loss before taxation |
|
(1,030) |
|
(454) |
|
(37,162) |
|
Adjustments for: |
|
|
|
|
|
|
|
Dividend Income |
|
- |
|
(200) |
|
(911) |
|
Net finance (income) / expense |
|
(40) |
|
(136) |
|
18 |
|
Loan Written Off |
|
- |
|
- |
|
2,238 |
|
Fair value changes on unquoted financial assets at fair value through profit or loss |
|
(337) |
|
(280) |
|
34,094 |
|
Realised gain on disposal of investment |
|
- |
|
(5) |
|
(5) |
|
Share-based expenses |
|
- |
|
- |
|
(1) |
|
Decrease in other receivables |
|
(12) |
|
65 |
|
(12) |
|
(Decrease)/ increase in other payables and accruals |
|
99 |
|
(52) |
|
(186) |
|
|
|
|
|
|
|
|
|
Net cash used in operating activities |
|
(1,320) |
|
(1,062) |
|
(1,927) |
|
|
|
|
|
|
|
|
|
Cash flow from investing activities |
|
|
|
|
|
|
|
Dividend income received |
|
- |
|
200 |
|
1,611 |
|
Proceed received from unquoted financial assets at fair value through profit or loss |
|
15,001 |
|
3,263 |
|
756 |
|
Purchase of unquoted financial assets at fair value through profit and loss |
|
- |
|
(2,560) |
|
(2,560) |
|
Loans granted |
|
36 |
|
- |
|
- |
|
Proceeds from repayment of loan granted |
|
- |
|
- |
|
2,400 |
|
|
|
|
|
|
|
|
|
Net cash generated from investing activities |
|
15,037 |
|
903 |
|
2,207 |
|
|
|
|
|
|
|
|
|
Cash flows from financing activities |
|
|
|
|
|
|
|
Net finance income received |
|
- |
|
(216) |
|
(216) |
|
Loans repaid |
|
- |
|
(2,400) |
|
(2,400) |
|
Net proceeds from issue of shares |
|
- |
|
- |
|
- |
|
|
|
|
|
|
|
|
|
Net cash used in financing activity |
|
- |
|
(2,616) |
|
(2,616) |
|
Net (decrease)/ increase in cash & cash equivalents during the period |
|
13,717 |
|
(2,775) |
|
(2,336) |
|
Cash & cash equivalents at the beginning of the period |
|
1,308 |
|
3,644 |
|
3,644 |
|
Cash & cash equivalents at the end of the period |
|
15,025 |
|
869 |
|
1,308 |
|
Notes to the financial information
1. CORPORATE INFORMATION
The Company is a limited company incorporated in the British Virgin Islands ("BVI") under the BVI Business Companies Act 2004 on
The Company is quoted on the AIM Market of the
The principal activity of the Company is investment holding. The Group is principally engaged in investing primarily in unlisted assets in the areas of luxury resorts real estate, pharmaceutical, mining, power generation, telecommunications, media and technology ("TMT"), and financial services or listed assets driven by corporate events such as mergers and acquisitions, pre-IPO, or re-structuring of state-owned assets.
The condensed consolidated interim financial information was approved for issue on
2. BASIS OF PREPARATION
The condensed consolidated interim financial information has been prepared in accordance with International Accounting Standard ("IAS") 34 "Interim Financial Reporting".
3. PRINCIPAL ACCOUNTING POLICIES
The condensed consolidated interim financial information has been prepared on the historical cost convention, as modified by revaluation of certain financial assets and financial liabilities at fair value through the income statement.
The accounting policies and methods of computation used in the condensed consolidated financial information for the six months ended
The seasonality or cyclicality of operations does not impact on the interim financial information.
4. SEGMENT INFORMATION
The operating segment has been determined and reviewed by the Board to be used to make strategic decisions. The Board considers there to be a single business segment, being that of investing activity, which is reportable in two cash generating units.
The reportable operating segment derives its revenue primarily from debt investment in several companies and unquoted investments.
The Board assesses the performance of the operating segments based on a measure of adjusted Earnings Before Interest, Taxes, Depreciation and Amortisation ("EBITDA"). This measurement basis excludes the effects of non-recurring expenditure from the operating segments such as restructuring costs. The measure also excludes the effects of equity-settled share-based payments and unrealised gains/losses on financial instruments.
The segment information provided to the
|
|
|
BVI |
||||
|
|
|
Six months ended |
||||
|
|
|
|
|
|
|
31 Dec 2016 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- |
|
Realised gain on disposal of investments |
|
0 |
|
5 |
|
5 |
|
Fair value changes on financial assets at fair value through profit or loss |
|
337 |
|
280 |
|
(34,094) |
|
Financial income |
|
40 |
|
136 |
|
80 |
|
Dividend income |
|
- |
|
200 |
|
911 |
|
Other income |
|
28 |
|
- |
|
220 |
|
|
|
|
|
|
|
|
Note: There is no activity for the business segment in HK.
5. TAXATION
No charge to taxation arises for the six months ended 30 June 2017 and 2016 as there were no taxable profits in either period.
Tax reconciliation:
|
Six months ended |
|
Year ended |
|
||
|
30 June 2017 US$000 |
|
30 June 2016 US$000 |
|
31 December 2016 US$000 |
|
|
|
|
|
|
|
|
Loss before taxation |
(1,030) |
|
(454) |
|
(37,162) |
|
|
|
|
|
|
|
|
Effective tax charge at 16.5% (2015:16.5%) |
(170) |
|
(221) |
|
(6,132) |
|
Effect of: |
|
|
|
|
|
|
Differences in overseas taxation rates |
170 |
|
221 |
|
6,132 |
|
|
|
|
|
|
|
|
Effective tax rate |
- |
|
- |
|
- |
|
|
|
|
|
|
|
|
The effective tax charge is calculated based on the rate of corporate tax in Hong Kong. As at 30 June 2017, the Group has no unused tax losses (30 June 2016: Nil) available for offset against future profits.
6. DIVIDEND
The Board does not recommend the payment of an interim dividend in respect of the six months ended 30 June 2017 (30 June 2016: Nil).
7. LOSS PER SHARE
The calculation of the basic and diluted loss per share attributable to owners of the Group is based on the following:
|
Six months ended |
Year ended |
||
|
30 June 2017 US$000 |
30 June 2016 US$000 |
31 December 2016 US$000 |
|
Numerator |
|
|
|
|
Basic / Diluted: |
Net Gain/ (loss) |
(1,030) |
(454) |
(37,162) |
|
|
|
|
|
|
Number of shares |
|||
|
'000 |
'000 |
'000 |
|
Denominator |
|
|
|
|
Basic: |
Weighted average shares |
191,967 |
191,967 |
191,967 |
|
Effect of diluted securities: |
|
|
|
|
Share options |
- |
150 |
- |
|
Warrant |
- |
- |
- |
|
|
|
|
|
Diluted: |
Adjusted weighted average shares |
191,967 |
192,117 |
191,967 |
For the six months ended 30 June 2017 and 2016, the share options are anti-dilutive and therefore the weighted average shares in issue are 191,967,084 and 191,967,084 respectively.
8. UNQUOTED FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS
|
30 June 2017 US$000 |
|
30 June 2016 US$000 |
|
31 December 2016 US$000 |
|
|
|
|
|
|
|
|
At the beginning of the period |
75,044 |
|
110,593 |
|
110,593 |
|
Fair value changes through profit and loss |
337 |
|
280 |
|
(34,094) |
|
Addition |
- |
|
2,560 |
|
2,480 |
|
Disposals |
(15,037) |
|
(3,342) |
|
(3,935) |
|
|
|
|
|
|
|
|
At the end of the period |
60,344 |
|
110,091 |
|
75,044 |
|
|
|
|
|
|
|
|
9. SHARE CAPITAL
|
Number of Shares |
|
Amount US$000 |
|
|
|
|
|
|
Authorised, called-up and fully paid ordinary shares of no par value each at 31 December 2016 and 30 June 2017 |
191,967,084 |
|
129,543 |
|
|
|
|
|
|
Under the BVI corporate laws and regulations, there is no concept of "share premium", and all proceeds from the sale of no par value equity shares is deemed to be share capital of the Company.
10. FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS
The following table provides an analysis of financial instruments that are measured subsequent to initial recognition at fair value, grouped into Level 1, 2 or 3 based on the degree to which the fair value is observable:
l Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets or liabilities;
l Level 2 fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the assets or liability, either directly or indirectly; and
l Level 3 fair value measurements are those derived from inputs that are not based on observable market data.
|
As at 30 June 2017 US$000 |
|
As at 30 June 2016 US$000 |
|
As at 31 December 2016 US$000 |
|
|
|
|
|
|
|
|
Level 3 |
|
|
|
|
|
|
Unquoted financial assets at fair value through profit or loss (note 8) |
60,344 |
|
110,091 |
|
75,044 |
|
|
|
|
|
|
|
|
|
60,344 |
|
110,091 |
|
75,044 |
|
There is no transfer between levels in the current period. Carrying values of all financial assets and liabilities are approximate to fair values. The value of level 3 investments has been determined using the yield capitalisation (discounted cash flow) method.
11. RELATED PARTY TRANSACTIONS
During the period under review, the Group entered into the following transactions with related parties and connected parties:
|
Note |
30 June 2017 US$000 |
30 June 2016 US$000 |
31 December 2016 US$000 |
Amount due to Directors |
(i) |
|
|
|
- John Croft |
|
12 |
7 |
- |
- Ernest Wong Yiu Kit |
|
3 |
2 |
2 |
- Conor MacNamara |
|
6 |
3 |
3 |
|
|
|
|
|
Amount due from |
|
|
|
|
Adamas Global Alternative Investment Management Inc. |
|
309 |
49 |
292 |
|
|
|
|
|
Period-end balance arising from sales/ purchases of services |
|
|
|
|
Management fee to Investment Manager |
(ii) |
735 |
609 |
1,182 |
(i) The amounts due thereto are unsecured, interest free and have no fixed term of repayment. There are no other contracts of significance in which any director has or had a material interest during the current period.
(ii) Adamas Global Alternative Investment Management Inc. was the Investment Manager of the Group until 1 May 2017. The management fee which is calculated and paid bi-annually in advance calculated at an annual rate of 1% of the higher of the net asset value of the Company's portfolio of assets or market capitalisation.
(iii) Harmony Capital Investors Limited is the current Investment Manager of the Group and the appointment starts from 1 May 2017. The management fee which is calculated and paid bi-annually in advance calculated at an annual rate of 1.75% of the net asset value of the Company's portfolio of assets. Management fees of US$235,000 and US$500,000 were incurred for Harmony Capital and Adamas Global Alternative Investment Management Inc. respectively during the reporting period.
12. COPIES OF THE INTERIM REPORT
The interim report is available for download from www.adamasfinance.com.
This information is provided by RNS
The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of...
FOR OUR FULL DISCLAIMER CLICK HERE