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VinaLand Limited   -  VNL   

Interim results

Released 13:22 27-Mar-2019

RNS Number : 1808U
VinaLand Limited
27 March 2019
 

27 March 2019

VinaLand Limited                                       

Interim results for the six months ended 31 December 2018

VinaLand Limited ("the Company" or "VNL"), the AIM-quoted investment vehicle established to target strategic segments within Vietnam's emerging real estate market, today announces its interim results for the six months ended 31 December 2018 ("the Period").

Financial highlights:

·             Net Asset Value ("NAV") of USD0.5 million (30 June 2018: USD46.9 million); and,

·             NAV per share of USD0.0036 (30 June 2018: USD0.286).

Operational highlights:

During the Period, VNL completed its last four divestments as below:

·    196 HVT project in July 2018, resulting in net proceeds of USD2.8 million.

·    SGPY project in July 2018, resulting in net proceeds of USD0.3 million. 

·    Green Park Estate project in November 2018, resulting in net proceeds of USD35.3 million.

·    Garland project in November 2018, with final return from development of USD0.9 million.

About VinaCapital

Founded in 2003, VinaCapital is a leading investment and asset management firm headquartered in Vietnam, with a diversified portfolio of USD1.8 billion in assets under management. The firm has two closed-ended funds that trade on the London Stock Exchange: the VinaCapital Vietnam Opportunity Fund Limited, which trades on the Main Market, and VinaLand Limited which trades on AIM. VinaCapital also manages the Forum One - VCG Partners Vietnam Fund, one of Vietnam's largest open-ended UCITS-compliant funds, the Vietnam Equity Special Access Fund, numerous segregated accounts, and two domestic funds. VinaCapital also has joint ventures with Draper Fisher Jurvetson in venture capital, and Warburg Pincus in hospitality and lodging. VinaCapital's expertise spans a full range of asset classes including capital markets, private equity, real estate, venture capital, and fixed income.

For more information about VinaCapital, please visit www.vinacapital.com

The financial statements will be posted to shareholders and are available on the Company's website at https://vnl.vinacapital.com/       .

 

Enquiries:

Michael Truong / Joel Weiden
VinaCapital Investment Management Limited
Investor Relations / Communications
+84 28 3821 9930

michael.truong@vinacapital.com / joel.weiden@vinacapital.com  
 

Philip Secrett
Grant Thornton UK LLP, Nominated Adviser
+44 (0)20 7383 5100

philip.j.secrett@uk.gt.com 
 

David Benda / Hugh Jonathan
Numis Securities Limited, Broker
+44 (0)20 7260 1000

funds@numis.com

 

 

Chairman's Statement

 

Dear Shareholders,

 

I am pleased to report that VinaLand Limited (the "Company", "VNL") has completely divested all of its assets and distributed most of the divestment proceeds to shareholders during the interim period from 1 July 2018 to 31 December 2018.

 

Project divestments

 

During the period the Company completed the last four disposals as follows:

 

·    196 HVT project (July 2018): the Company disposed of its entire stake in the 196 HVT project at a total valuation of 22.1%, above the 31 March 2018 unaudited net asset value and 28.0% below the net asset value at the time of the 2016 EGM, including adjustments for additional investments over this period. This transaction resulted in net cash proceeds of USD2.8 million to VNL.

·    SGPY project (July 2018): the Company divested its entire stake in this project which resulted in net cash proceeds of USD0.3 million to VNL, equal to both the 31 March 2018 unaudited net asset value and the net asset value at the time of the 2016 EGM (including adjustments for additional investments over this period).

·    Green Park Estate project (November 2018): the Company disposed of its entire stake in this project for net cash proceeds of approximately USD35.3 million, which includes the repayment of shareholder loans, resulting in an IRR of 0.9% to the Company. The total valuation is recorded at 22.5% above the 30 September 2018 unaudited net asset value and 14.8% above the unaudited net asset value at the time of VNL's extraordinary meeting in November 2016. Both figures include adjustments for additional investments up to the date of exit.

·    Garland project (November 2018): the Company received the final return from the development of Garland project (located in Ho Chi Minh City) with net proceeds of USD0.9 million to VNL, which is equal to the 30 September 2018 unaudited net asset value and 37.8% below the net asset value at the time of the 2016 EGM including adjustments for additional investments over this period. 

 

Following the completion of the disposal of 196 HVT and SGPY projects in July 2018 and in accordance with paragraph 5.6 of the AIM Note for Investing Companies (which forms part of the AIM Rules), the Company announced that it had disposed of substantially all of its assets and entered a period of 12 months to begin an orderly wind up of the fund and cancellation of the Company's shares from trading on AIM.  If the wind up is not fulfilled in the 12 month period the Company's shares will be suspended from trading on AIM in July 2019.

 

AGM                              

 

The Company held its Annual General Meeting ("AGM") on 14 December 2018, which included a resolution for the cancellation of the quotation of VNL shares from trading on AIM (the "Delisting Resolution"). However, the Delisting Resolution was not passed. Consequently, trading in VNL shares on AIM was not cancelled and the Company will continue to remain listed on AIM.

 

 

Shareholder distributions and share repurchases

Following the disposal of all projects in the portfolio, the Company distributed most of its distributable funds to shareholders in December 2018 via a return of capital of approximately USD45.45 million, representing USD0.31 per ordinary share.  In addition to the return of capital, the Company also repurchased (via ongoing share buybacks) a further 16.8 million ordinary shares, which have been cancelled.

 

During this 6-month period, USD50.2 million in total was distributed using these two methods.

 

Since the commencement of the share buyback programme, the Company has cancelled 353.3 million shares, representing 70.7% of the Company's total issued shares.   

 

Fund performance

 

The NAV per share (reviewed by the auditors) was USD0.0036 at 31 December 2018, after taking into account the provision made for the Company's final commitments, including the operating and liquidation costs until the winding up of the Company.

 

On behalf of the Board, I appreciate your continued support.

 

 

Michel Casselman

Chairman

VinaLand Limited

27 March 2019
 

 

CONDENSED INTERIM CONSOLIDATED BALANCE SHEET

 

 

 

31 December 2018

30 June

2018

 

Note

USD'000

USD'000

 

 

 

 

ASSETS

 

 

 

 

 

 

 

Current

 

 

 

Trade and other receivables

7

317

3,468

Receivables from and advances to related parties

 

-

100

Short-term investments

 

34

34

Cash and cash equivalents

8

5,752

29,079

 

 

───────

───────

Total current assets

 

6,103

32,681

 

 

 

 

Assets classified as held for sale

9

-

 30,308

 

Total assets

 

───────

     6,103

 ═══════

───────

62,989

══════

 

 

 

31 December 2018

30 June

2018

 

Note

USD'000

USD'000

 

 

 

 

EQUITY AND LIABILITIES

 

 

 

 

 

 

 

EQUITY

 

 

 

Equity attributable to equity shareholders of the parent

 

 

 

Share capital

10

1,466

1,634

Additional paid-in capital

11

68,258

118,422

Equity reserve

 

76,454

76,283

Translation reserve

 

(37)

(4,327)

Accumulated losses

 

(145,616)

   (145,324)

 

 

───────

───────

 

 

525

 46,688

Non-controlling interests

 

-

243

 

Total equity

 

───────

525

───────

───────

46,931

───────

LIABILITIES

 

 

 

 

 

 

 

Current

 

 

 

Trade and other payables

12

1,849

3,166

Payables to related parties

19

3,729

12,591

 

 

───────

───────

Total current liabilities

 

5,578

15,757

 

 

 

 

Liabilities classified as held for sale

9

-

301

 

Total liabilities

 

───────

5,578

───────

16,058

 

Total equity and liabilities

 

───────

6,103

───────

62,989

 

 

═══════

═══════

Net assets per share attributable to equity

 shareholders of the parent (USD per share)

 

17(c)

0.004

  0.286

 

 

═══════

═══════

 

 

CONDENSED INTERIM CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

 

 

 

 

Equity attributable to equity shareholders of the Company

 

 

 

 

 

Share

capital

 

Additional paid-in capital

 

 

Equity reserve

 

 

Translation reserve

 

 

Accumulated losses

Total equity attributable to owners of the Company

 

Non-

controlling interests

 

 

Total
equity

 

 

 

USD'000

USD'000

USD'000

USD'000

USD'000

USD'000

USD'000

USD'000

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at 1 July 2018

1,634

118,422

76,283

(4,327)

(145,324)

46,688

243

46,931

 

 

Loss for the period

-

-

-

-

(292)

(292)

 -

(292)

 

 

Currency translation

-

-

-

(282)

-

(282)

-

(282)

 

Reclassification of currency translation reserve on disposal of subsidiaries

-

-

-

4,572

-

4,572

-

4,572

 

 

 

─────

─────

─────

─────

──────

─────

───────

──────

 

 

Total comprehensive income

 

-

─────

-

─────

-

─────

4,290 

─────

(292)

──────

3,998

─────

 -

──────

3,998

──────

 

 

Transactions with owners in their

 capacity as owners:

 

 

 

 

 

 

 

 

 

 

Repurchases and cancellation of shares

(168)

(4,712)

171

-

-

(4,709)

-

(4,709)

 

Distributions to shareholders (Note 11)

-

(45,452)

-

-

-

(45,452)

-

(45,452)

 

 

Distributions to non-controlling interests

-

-

-

-

-

-

(243)

(243)

 

 

 

─────

───────

──────

──────

──────

──────

──────

──────

 

 

Balance at 31 December 2018

1,466

68,258

76,454

(37)

(145,616)

525

-

525

 

 

 

═════

═══════

══════

══════

══════

══════

══════

══════

 

                         

 

 

 

 

 

            Equity attributable to equity shareholders of the Company

 

 

 

 

 

Share

capital

 

Additional paid-in capital

 

 

Equity reserve

 

 

Other reserve

 

 

Translation reserve

 

 

Accumulated losses

Total equity attributable to owners of the Company

 

Non-

controlling interests

 

 

Total
equity

 

USD'000

USD'000

USD'000

USD'000

USD'000

USD'000

USD'000

USD'000

USD'000

 

 

 

 

 

 

 

 

 

 

Balance at 1 July 2017

2,580

332,803

65,166

 

(10)

(45,443)

(113,612)

241,484

74,867

316,351

Loss for the period

-

-

-

-

-

(19,398)

(19,398)

730

(18,668)

Currency translation

-

-

-

-

338

-

338

89

427

Reclassification of currency translation reserve on disposal of subsidiaries

-

-

-

-

20,107

-

20,107

3,183

23,290

 

─────

─────

─────

─────

─────

──────

─────

──────

─────

Total comprehensive income

 

-

─────

-

─────

-

─────

-  
 
─────

20,445 

─────

(19,398)

──────

1,047 

─────

4,002

─────

5,049

─────

Transactions with owners in their

 capacity as owners:

 

 

 

 

 

 

 

 

 

Repurchases and cancellation of shares

(772)

(72,523)

10,527

-

-

-

(62,768)

-

(62,768)

Distributions to shareholders

-

(60,433)

-

-

-

-

(60,433)

-

(60,433)

Disposals of subsidiaries

-

-

-

10

-

-

10

(52,578)

(52,568)

Capital contributions to subsidiaries

-

-

-

-

-

-

-

2,759

2,759

Distributions to non-controlling interests

-

-

-

-

-

-

-

(19,133)

(19,133)

 

─────

───────

──────

──────

──────

──────

──────

──────

──────

Balance at 31 December 2017

1,808

199,847

75,693

-

(24,998)

(133,010)

119,340

9,917

129,257

 

 

═════

═══════

══════

══════

══════

══════

══════

══════

══════

                             

 

CONDENSED INTERIM CONSOLIDATED INCOME STATEMENT

 

 

 

Six months ended

 

 

31 December 2018

31 December 2017

 

Note

USD'000

USD'000

 

 

 

 

Revenue

 

-

30

Cost of sales

 

-

(102)

 

 

──────

──────

Gross loss

 

-

(72)

 

 

 

 

Net gain on fair value adjustments of investment properties

 

 

 

-

 

3,547

Net gain on fair value adjustment of investment properties classified as held for sale

 

 

 

 

2,623 

Selling and administration expenses

13

(2,890)

(2,435)

Net gains/(losses) on disposals of investments

14

4,157

(20,097)

Finance income

 

131

545

Finance expenses

 

(113)

(580)

Share of losses of associates, net

 

(558)

(295)

Other income

 

960

195

Other expenses

 

(14)

(488)

 

 

──────

──────

Income/(loss) from operations before income tax

 

1,673

(17,057)

Income tax

15

(1,965)

(1,611)

 

 

──────

──────

Loss from operations

 

(292)

(18,668)

 

 

 

 

Attributable to equity shareholders of the Company

 

                   (292)

               (19,398)

Attributable to non-controlling interests

 

                         -

                     730 

 

 

──────

──────

Net loss for the period

 

                    (292)

               (18,668)

 

 

══════

══════

Loss per share

-  basic and diluted (USD per share)

 

17(a)

 

                   (0.00)

 

                   (0.08)

 

 

──────

──────

 

 

CONDENSED INTERIM CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

 

 

 

Six months ended

 

 

31 December 2018

31 December 2017

 

 

USD'000

USD'000

 

 

 

 

Net loss for the period

 

(292) 

(18,668) 

 

 

 

 

Other comprehensive income

 

 

 

 

 

 

 

Items that may be reclassified subsequently to profit or loss:

 

 

 

Reclassification of currency translation reserve on

 disposal of investments

 

 

4,572

 

23,290

Exchange differences on translating foreign operations

 

 (282)

427

 

 

──────

──────

 

 

 

 

Other comprehensive income for the period

 

4,290

23,717

 

 

──────

──────

Total comprehensive income for the period

 

3,998

5,049

 

 

════

════

 

 

 

 

Attributable to equity shareholders of the Company

 

3,998  

1,047  

Attributable to non-controlling interests

 

-

                    4,002

 

 

────

3,998   

════

────

  5,049   

════

 

 

 

 

 

CONDENSED INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS

 

 

 

Six months ended

 

 

 

31 December

2018

31 December

2017

 

Note

USD'000

USD'000

Operating activities

 

 

 

Net operating profit/(loss) before tax

 

1,673

(17,057)

 

Adjustments for:

 

 

 

 

Depreciation and amortisation

 

-

8

 

Net gain on fair value adjustments of investment properties

 

-

(3,547)

 

Net gain on fair value adjustments of investment properties

   classified as held for sales

 

 

-

 

(2,623)

 

Losses on sales of subsidiaries

14

670

20,168

 

Gains on sales of assets classified as held for sales

14

(4,827)

(71)

 

Share of losses of associates, net

 

558

295

 

Unrealised foreign exchange losses

 

30

7

 

Interest expense

 

76

570

 

Interest income

 

(123)

(374)

 

 

Net loss before changes in working capital

 

──────

(1,943)

──────

(2,624)

 

 

 

 

Change in trade receivables and other current assets

 

3,400

(5,368)

Change in trade payables and other current liabilities

 

(9,140)

 61,540

 

Net cash (outflow)/inflow from operating activities

 

──────

(7,683)

──────

──────

53,548

──────

Investing activities

 

 

 

Interest received

 

123

365

Purchases of investment properties and prepayments for     acquisitions of investments

 

 

-

 

(8,646)

(Net payments)/proceeds from sales of subsidiaries

 

(135)

51,543

Proceeds from disposals of assets classified as held for sale

 

34,848

2,987

Investments in associates

 

-

(11,186)

 

Net cash inflow from investing activities

 

──────

34,836  

──────

──────

35,063

──────

           

 

 

 

 

 

 

 

Six months ended

 

 

 

31 December

2018

31 December

2017

 

 

Note

USD'000

USD'000

 

 

 

 

 

Financing activities

 

 

 

Additional capital contributions from non-controlling interests

 

-

2,759

Ordinary shares acquired by the Company

10

(4,709)

(62,768)

Distributions to shareholders

11

(45,452)

(60,433)

Distributions to non-controlling interests

 

(243)

(19,133)

Interest paid

 

(76)

(571)

Net cash outflow to financing activities

 

──────

(50,480)

──────

──────

(140,146)

──────

Net changes in cash and cash equivalents for the period

 

(23,327)

(51,535)

Cash and cash equivalents at the beginning of the period

 

29,079

88,919

Cash and cash equivalents classified as held for sale

 

-

952

Exchange differences on cash and cash equivalents

 

-

5

 

Cash and cash equivalents at the end of the period

 

8

──────

5,752

══════

──────

38,341

══════

 

During the period, major non-cash transactions included capital gains tax of USD2.0 million (six months ended 31 December 2017: USD10.1 million) realised on the disposals of investments. The tax amounts due were withheld from disposal proceeds by the acquirers of investments and remitted to the tax authorities.  As a result, these amounts are excluded from proceeds from disposal of subsidiaries included in the condensed interim consolidated statement of cash flows.

 

 

NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

 

1          GENERAL INFORMATION

 

VinaLand Limited ("the Company") is a limited liability company incorporated in the Cayman Islands. The registered office of the Company is PO Box 309GT, Ugland House, South Church Street, George Town, Grand Cayman, Cayman Islands. The original objective of the Company was to focus on key growth segments within Vietnam's emerging real estate market, namely residential, office, retail, industrial and leisure projects in Vietnam and the surrounding countries in Asia. The Company is listed on the AIM Market of the London Stock Exchange under the ticker symbol VNL.

 

At the Extraordinary General Meeting ("EGM") held on 21 November 2012 the shareholders approved a proposal that the Company make no new investments and dispose of a portion of its investments in a controlled and orderly manner so as to maximise returns to shareholders. At the subsequent EGM held on 18 November 2016 this strategy was expanded to include the disposal of all remaining investments. The key changes impacting these financial statements are summarised as follows:

 

·      The new strategy involves the orderly sell down of investments in conjunction with ongoing development of selected projects to maximise returns to shareholders. All projects will be realised over a period of approximately three years and the proceeds collected, less operating costs, disposal and alignment fees, will be returned to shareholders.

 

·      The Third Amended and Restated Investment Management Agreement ("the Third Amended Management Agreement") introduces a new fee structure composed of disposal and alignment fees, prepayment advances and a retention account to ensure that the Investment Manager is incentivised to meet the investing policy (Note 19).

 

On 23 July 2018, the Company announced that it had disposed of substantially all of its assets. In accordance with paragraph 5.6 of the AIM Note for Investing Companies, which forms part of the AIM Rules, the Company has 12 months to begin an orderly wind up of the Company and cancellation of its shares from trading on AIM, ultimately resulting in a voluntary liquidation. If this is not fulfilled, the Company's shares will be suspended from trading on AIM in July 2019.

 

The condensed interim consolidated financial statements for the six months ended 31 December 2018 were approved for issue by the Company's Board of Directors on 26 March 2019.

 

These condensed interim consolidated financial statements have been reviewed, not audited.

 

2          BASIS OF PREPARATION

 

The Company and its subsidiaries herein are referred to as the Group.

 

These condensed interim consolidated financial statements are for the six months ended 31 December 2018. They have been prepared in accordance with International Accounting Standard 34, "Interim Financial Reporting" as issued by the International Accounting Standards Board ("IASB"). They do not include all of the information required in the annual consolidated financial statements which are prepared in accordance with International Financial Reporting Standards ("IFRSs"). Accordingly, these financial statements are to be read in conjunction with the annual consolidated financial statements of the Group for the year ended 30 June 2018, which have been prepared in accordance with IFRSs.

 

 

 

 

Going concern

 

On 23 July 2018, the Company announced that it had disposed of substantially all of its assets. In accordance with paragraph 5.6 of the AIM Note for Investing Companies, which forms part of the AIM Rules, the Company has 12 months to begin an orderly wind up of the Company and cancellation of its shares from trading on AIM, ultimately resulting in a voluntary liquidation. If this is not fulfilled, the Company's shares will be suspended from trading on AIM in July 2019. As a consequence, these condensed interim consolidated financial statements have been prepared using the liquidation basis, as the going concern basis is no longer considered appropriate.

 

3          ACCOUNTING POLICIES

 

These condensed interim consolidated financial statements (the "interim financial statements") have been prepared in accordance with the accounting policies, methods of computation and presentation adopted in the last annual consolidated financial statements for the year ended 30 June 2018.

 

4          CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

 

When preparing the condensed interim consolidated financial statements, management undertakes a number of judgements, estimates and assumptions about recognition and measurement of assets, liabilities, income and expenses. The actual results may differ from the judgements, estimates and assumptions made by management, and may not equal the estimated results.

 

There are no significant accounting estimates in the condensed interim consolidated financial statements for the six months ended 31 December 2018.

 

5          SEGMENT ANALYSIS

 

In identifying its operating segments, management generally follows the Group's sectors of investment which are based on internal management reporting information for the Investment Manager's management, monitoring of investments and decision making. The operating segments by investment portfolio include commercial, residential and office buildings, hospitality, mixed-use segments and cash and short-term investments.

 

Detail of activities undertaken by each segment and how each segment is managed and monitored, can be found in Note 4 to the annual consolidated financial statements of the Group for the year ended 30 June 2018.

 

There is no measure of segment liabilities regularly reported to the Investment Manager; therefore, liabilities are not disclosed in the sector analysis. Segment information can be analysed as follows for the reporting periods under review:

 

 

 

 

 

(a)        Condensed Interim Consolidated Income Statement

 

 

Six months ended 31 December 2018

 

 

Commercial

Residential and office buildings

 

Mixed use

 

Total

 

 

USD'000

USD'000

USD'000

USD'000

 

 

 

 

 

 

 

Revenue

-

-

-

-

 

Cost of sales

-

-

-

-

 

 

─────

─────

─────

─────

 

Gross profit

-

-

-

-

 

Net gain/(loss) on disposals of investments

4,827

-

(670)

4,157

 

Finance income

-

71

60

131

 

Share of losses of associates, net

-

-

(558)

(558)

 

Other income

-

882

78

960

 

 

─────

─────

─────

─────

 

Total profit/(loss) before unallocatable expenses

 

4,827

 

953

 

(1,090)

 

4,690

 

Selling and administration expenses

 

 

 

(2,890)

 

Finance expenses

 

 

 

(113)

 

Other expenses

 

 

 

(14)

 

 

Profit before tax

 

 

 

─────

1,673

 

Income tax

 

 

 

  (1,965)

 

 

Net loss for the period

 

 

 

─────

(292)

═════

 

 

 

 

 

 

Six months ended 31 December 2017

 

 

 

Commercial

Residential and office buildings

 

 

Hospitality

 

 

Mixed use

 

 

Total

 

USD'000

USD'000

USD'000

USD'000

USD'000

 

 

 

 

 

 

Revenue

-

15

-

15

30

Cost of sales

-

(94)

-

(8)

(102)

 

──────

──────

─────

─────

──────

Gross (loss)/profit

-

(79)

-

7

(72)

Net loss on disposals of investments

-

(10,826)

-

(9,271)

(20,097)

Finance income

16

229

-

300

545

Net gain/(loss) on fair value adjustments of investment properties

 

-

 

3,923

 

-

(376)

 

3,547

Net (loss)/gain on fair value adjustment of investment properties classified as held for sale

 

 

(27)

 

 

2,650

 

 

-

 

 

-

 

 

2,623

Share of losses of associates, net

(295)

-

-

-

(295)

Other income

-

124

69

2

195

 

──────

──────

─────

─────

──────

Total (loss)/profit before unallocatable expenses

 

(306)

 

(3,979)

 

69

 

(9,338)

 

(13,554)

Selling and administration expenses

 

 

 

 

(2,435)

Finance expenses

 

 

 

 

(580)

Other expenses

 

 

 

 

(488)

 

Loss before tax

 

 

 

 

─────

(17,057)

Income tax

 

 

 

 

  (1,611)

 

Net loss for the period

 

 

 

 

─────

(18,668)

═════

 

 

 

 

(b)        Condensed Interim Consolidated Balance Sheet

 

 

As at 31 December 2018

 

 

 

Commercial

Residential and office buildings

 

Mixed

use

 

Cash and deposits

 

 

Total

 

USD'000

USD'000

USD'000

USD'000

USD'000

 

 

 

 

 

 

Trade, tax and other receivables

-

317

-

-

317

Short-term investments

-

-

-

34

34

Cash and cash equivalents

-

-

-

5,752

5,752

 

Total assets

──────

-

══════

───────

317

═══════

───────

-

═══════

──────

5,786

══════

───────

6,103

═══════

Total assets include:

-   Addition to non-current assets (other than financial instruments and deferred tax assets)

-

-

-

-

-

 

 

As at 30 June 2018

 

 

 

Commercial

Residential and office buildings

 

Mixed

use

 

Cash and deposits

 

 

Total

 

USD'000

USD'000

USD'000

USD'000

USD'000

 

 

 

 

 

 

Trade, tax and other receivables

-

424

3,144

-

3,568

Short-term investments

-

-

-

34

34

Cash and cash equivalents

-

-

-

29,079

29,079

Assets classified as held for sale

29,555

-

753

-

30,308

 

Total assets

─────

29,555

═════

────

424

════

────

3,897

════

─────

29,113

═════

─────

62,989

═════

Total assets include:

-   Addition to non-current assets (other than financial instruments and deferred tax assets)

10,722

13,019

78

-

23,819

 

           

 

 

6          SUBSIDIARIES

 

The Group had the following principal subsidiaries which are held through special purpose vehicles established outside of Vietnam at 31 December 2018 and 30 June 2018:

 

 

 

31 December 2018

 

30 June 2018

 

 

Name

Country of incorporation and place of business

Percentage interest held by the Group

Percentage interest held by non-controlling interests

 

Percentage interest held by the Group

Percentage interest held by non-controlling interests

 

Nature of business

 

 

 

 

 

 

 

 

Dien Phuoc Long Real Estate Company Limited

Vietnam

100.0%

-

 

100.0%

-

Property investment

VinaCapital Commercial Center Limited (Vietnam)

Vietnam

-

-

 

38.2%

61.8%

Property investment

SIH Real Estate Limited Company (Vietnam)

Vietnam

-

-

 

75.0%

25.0%

Property investment

 

 

 

 

 

 

All subsidiaries are included in the consolidated financial statements. The proportion of the voting rights in the subsidiary undertakings held directly by the Group does not differ from the proportion of ordinary shares held. The Group further does not have any shareholding in the preference shares of subsidiary undertakings included in the Group.

 

During the period, the Group sold several subsidiaries, details of which are provided on the following pages. The assets and liabilities held by the subsidiaries sold were as follows:

 

 

 

As at the date of disposal

 

 

USD'000

Current assets

 

 

        Assets classified as held for sale

 

753

 

 

──────

Total current assets

 

753

Current liabilities

 

 

        Trade payables

 

(529)

        Liabilities classified as held for sale

 

(301)

 

 

──────

Total current liabilities

 

(830)

 

 

──────

Net liabilities at the date when subsidiaries were sold

 

(77)

 

 

──────

Net liabilities attributable to the Company

 

(77)

Net liabilities attributable to non-controlling interests

 

-

 

 

──────

Total consideration

 

607

 

 

──────

Consideration received from sales of subsidiaries

607

Less: Cash and cash equivalents of disposed subsidiaries

(742)

 

 

──────

Cash paid due to loss of control of subsidiaries

(135)

 

══════

       

 

Details of the losses from sales of subsidiaries are as follows:

 

 

Period ended

31 December 2018

 

 

USD'000

 

 

 

Total consideration

 

607

Carrying amount of net liabilities sold attributable to the Company

 

(77)

 

 

──────

Gain on sales of subsidiaries before reclassification of currency translation reserve

684

Reclassification of currency translation reserve

 

(1,354)

 

 

──────

Loss on sales of subsidiaries

 

(670)

 

 

──────

       
 

 

 

 

Sale of VinaCapital Commercial Center Limited

 

During the period the Group sold its 38.2% equity interest in VinaCapital Commercial Center Limited for a total consideration of USD0.6 million. The book value of the net assets at the sale date was USD0.2 million and the reclassification of translation reserve on disposal was USD0.8 million, resulting in a loss of USD0.4 million.

 

Sale of SIH Real Estate Limited Company

 

During the period the Group sold its 75% equity interest in SIH Real Estate Limited Company for  a total consideration of USD1.0. The book value of the net liabilities at the sale date was USD0.2 million and the reclassification of translation reserve on disposal was USD0.5 million, resulting in a loss of USD0.3 million.

 

7          TRADE AND OTHER RECEIVABLES

 

 

31 December 2018

30 June

2018

 

USD'000

USD'000

 

 

 

Receivables from disposals of subsidiaries (*)

150

3,143

Short-term loan receivable from third parties

-

263

Other receivables

167

 62

 

───

317 

═══

──────

 3,468

══════

 

(*)   Receivables from disposals of subsidiaries represent the final settlements upon completion of the transfer of ownership of subsidiaries to the buyers in accordance with the relevant sale and purchase agreements.

 

All current trade and other receivables are short-term in nature and their carrying values, after allowances for impairment, approximate their fair values at the date of the condensed interim consolidated balance sheet.

 

 

 

 

8          CASH AND CASH EQUIVALENTS

 

 

31 December

2018

30 June

2018

 

USD'000

USD'000

 

 

 

Cash at banks

2,952

29,035

Cash equivalents

2,800

44

 

──────

──────

 

5,752

29,079

 

══════

══════

 

Cash equivalents include short-term highly liquid investments with original maturities of three months or less.

 

As at 31 December 2018, cash and cash equivalents held at the Company level amounted to USD4.8 million (as at 30 June 2018: USD27.8 million). The remaining balance of cash and cash equivalents is held by subsidiaries in Vietnam. Cash held in Vietnam is subject to restrictions imposed by co-investors and the Vietnamese government and it cannot be transferred out of Vietnam unless those restrictions are satisfied.

 

In accordance with the Third Amended Management Agreement, 20% of any disposal fee payable to the Investment Manager is to be deposited into a separate bank account under the Company's name ("the Retention Account"). These funds will be distributed upon the performance of certain milestones by the Manager. The Company has no specific rights to these funds. Included in cash and cash equivalents as at 31 December 2018 was USD3.6 million transferred into the Retention Account (as at 30 June 2018: USD1.2 million).

 

9          ASSETS AND LIABILITIES CLASSIFIED AS HELD FOR SALE

 

            As at 31 December 2018, the Group had no assets and liabilities classified as held for sales.

 

For the comparative balance sheet date:

 

 

30 June 2018

 

 

 

 

Attributable to

 

 

Assets classified as held for sale

Liabilities classified as held for sale

Net assets classified as held for sale

Non-controlling interests

Equity shareholders of the parent

 

USD'000

USD'000

USD'000

USD'000

USD'000

 

 

 

 

 

 

Thang Loi Textile Garment Joint Stock Company

 

29,555

 

-

 

29,555

-

 

29,555

VinaCapital Commercial Center Limited (Vietnam)

 

726

 

(274)

 

452

 

243

 

209

SIH Real Estate Limited Company (Vietnam)

 

27

 

(27)

 

-

 

-

 

-

 

─────

30,308

═════

───

(301)

 ═══

─────

30,007 ═════

───

243

 ═══

─────

29,764

═════

 

 

 

 

 

 

It is the Group's view that all of its assets and liabilities classified as held for sales are in Level 3 of the fair value hierarchy. The major classes of assets and liabilities and their movements during the period/year are as follows:

 

 

 

1 July

2018

Change in carrying amount

 

 

Disposals

 

31 December 2018

 

USD'000

USD'000

USD'000

USD'000

Assets classified as held for sale

 

 

 

 

Trade and other receivables

11

-

(11)

-

Cash and cash equivalents

742

-

(742)

-

Investments in associates

29,555

(558)

(28,997)

-

 

─────

─────

──────

─────

 

30,308

(558)

(29,750)

-

 

─────

─────

──────

─────

Liabilities classified as held for sale

 

 

 

 

Trade and other payables

301

-

(301)

-

 

─────

─────

──────

─────

 

301

-

(301)

-

 

─────

──────

──────

─────

Net assets classified as held for sale

30,007

═════

(558)

══════

(29,449)

══════

-

═════

           

 

For the comparative year:

 

 

 

 

1 July 2017

Change in carrying amount

 

 

Transferred in

 

 

Disposals

 

 

30 June 2018

 

USD'000

USD'000

USD'000

USD'000

USD'000

Assets classified as held for sale

 

 

 

 

 

Investment properties

287,058

8,474

-

(295,532)

-

Property, plant and equipment (net of accumulated depreciation)

 

11

 

(1)

 

-

 

(10)

 

-

Prepayment for acquisitions

3,077

(10)

-

(3,067)

-

Other non-current assets

14

-

-

(14)

-

Other current assets

4

10

-

(14)

-

Inventories

29,584

8

-

(29,592)

-

Trade and other receivables

1,645

(131)

11

(1,514)

11

Cash and cash equivalents

4,283

(715)

742

(3,568)

742

Investments in associates

4,287

35

29,555

(4,322)

29,555

 

──────

────

─────

──────

─────

 

329,963

7,670

30,308

(337,633)

30,308

 

──────

────

────

──────

─────

Liabilities classified as held for sale

 

 

 

 

 

Long-term borrowings and debts

78,247

2,742

-

(80,989)

-

Short-term borrowings and debts

18,828

1,114

-

(19,942)

-

Accruals and other current liabilities

35

247

-

(282)

-

Trade and other payables

27,405

4,994

301

(32,399)

301

 

──────

──────

─────

──────

─────

 

124,515

9,097

301

(133,612)

301

 

──────

──────

─────

──────

─────

Net assets classified as held for sale

205,448

══════

(1,427)

══════

30,007

 ═════

(204,021)

══════

30,007

═════

             

 

 

 

10         SHARE CAPITAL

 

 

31 December 2018

 

30 June 2018

 

Number of shares

 

 

USD'000

 

Number of shares

 

USD'000

Authorised:

Ordinary shares of USD0.01 each

 

500,000,000

──────────

 5,000

─────

 

500,000,000

──────────

 5,000

─────

 

 

 

 

 

 

Issued and fully paid:

 

 

 

 

 

Opening balance (1 July 2018/ 1 July 2017)

163,399,888

1,634

 

257,987,620

2,580

Shares purchased and cancelled

(16,780,000)

(168)

 

(94,587,732)

(946)

 

Closing balance

──────────

146,619,888

══════════

─────

1,466

═════

 

──────────

163,399,888

══════════

─────

1,634

═════

 

The Company considers investors holding more than a 10% beneficial interest in the ordinary shares of the Company as major shareholders. As at 31 December 2018, there were three investors that held more than 10% of the ordinary shares of the Company (30 June 2018: four).

 

During the period, the Company purchased and cancelled 16,780,000 of its ordinary shares (year ended 30 June 2018: 94,587,732 shares) for a total cash consideration of USD4.7 million (year ended 30 June 2018: USD73.0 million) at an average cost USD0.28 per share (year ended 30 June 2018: USD0.772 per share). The difference between the cost of the shares repurchased and their net asset value has been recorded in an equity reserve.

 

11         ADDITIONAL PAID-IN CAPITAL

 

Additional paid-in capital represents the excess of consideration received over the par value of shares issued.

 

 

31 December 2018

30 June

2018

 

USD'000

USD'000

 

 

 

Opening balance (1 July 2018/1 July 2017)

118,422

332,803

Shares repurchased and cancelled

(4,712)

(83,146)

Distributions to shareholders

(45,452)

(131,235)

 

Closing balance

───────

68,258

═══════

───────

118,422

═══════

 

On 16 November 2018, the Company announced that it would make a distribution of capital from its additional paid-in capital of USD45.5 million or 31 cents per ordinary share. As at 31 December 2018, this amount had been fully distributed.

 

 

 

 

 

12         CURRENT TRADE AND OTHER PAYABLES

 

 

31 December 2018

30 June 2018

 

USD'000

USD'000

 

 

 

Professional fees

1,844

3,154

Other payables

5

12

 

─────

           1,849

═════

──────

3,166

══════

 

All trade and other payables are short-term in nature. Their carrying values approximate their fair values as at the date of the condensed interim consolidated balance sheet.

 

13         SELLING AND ADMINISTRATION EXPENSES

 

 

Six months ended

 

31 December 2018

31 December

2017

 

USD'000

USD'000

 

 

 

Disposal and alignment fees under the Third Amended and Restated Investment Management Agreement (Note 19)

1,145

938

Professional fees (*)

1,336

1,002

General and administration expenses (**)

225

                    202

Staff costs (**)

-

                    251

Others (**)

184

                      42

 

─────

2,890

═════

─────

2,435

═════

                           

(*)   These expenses primarily relate to the operating activities of the Company such as legal and professional fees, audit fees, valuation fees, fund administrative and custodian fees, directors fees.

 

(**)  These expenses primarily relate to the operating activities of the Group's subsidiaries.

 

14         NET GAINS/(LOSSES) ON DISPOSALS OF INVESTMENTS

 

 

 

Six months ended

 

31 December

2018

31 December

2017

 

USD'000

USD'000

 

 

 

Losses on sales of subsidiaries (Note 6)

(670)

(20,168)

Gains on sales of assets classified as held for sale

4,827

71

 

──────

4,157

══════

──────

(20,097)

══════

 

 

 

 

 

15         INCOME TAX

 

VinaLand Limited is domiciled in the Cayman Islands. Under the current laws of the Cayman Islands, there are no income, corporation, capital gains or other taxes payable by the Company.

 

A number of subsidiaries are established in Vietnam and Singapore and are subject to corporate income tax in those countries. Deferred tax assets/liabilities of these subsidiaries are estimated based on the tax legislation of each jurisdiction and included in the deferred income tax assets/liabilities on the balance sheet.

 

As is the case with many other developing countries, Vietnam is in the process of implementing comprehensive tax regulations. As a result, the administration of tax regulations by government agencies may be subject to considerable discretion, and in many areas, the legal framework is uncertain and subject to interpretation. The Group has provided for all taxes expected to be payable by it under the current tax regulations in Vietnam. There is, however, an ongoing risk that government agencies might seek to impose additional taxes on the Group based on different interpretations of the regulations or through the retrospective application of new regulations.

 

On 19 June 2014, the Vietnamese National Assembly approved a new corporate income tax law. Under the new law, the standard corporate income tax was reduced from 25% to 22% effective 1 January 2015. A further reduction in tax rate to 20% became effective on 1 January 2016. No provision has been made for corporate income tax payable by the Vietnamese subsidiaries for the period because these subsidiaries do not have taxable income in Vietnam (period from 1 July 2017 to 31 December 2017

 

The relationship between the expected tax expense based on the applicable tax rate of 0% and the tax expense actually recognised in the condensed interim consolidated income statement can be reconciled as follows:

 

 

Six months ended

 

31 December 2018

31 December 2017

 

USD'000

 USD'000

 

 

 

Current income tax

 

 

Group's gain/(loss) before tax           

1,673

(17,057)

Group's gain multiplied by applicable tax rate (0%)

-

-

Capital gains tax

(1,965)

(11,485)

 

──────

──────

Total current tax expense

(1,965)

(11,485)

 

──────

──────

Deferred income tax

 

 

Decrease in deferred tax assets

-

-

Decrease in deferred tax liabilities

-

9,874

 

─────

─────

Total deferred income tax income

-

9,874

 

─────

─────

Tax expense

(1,965)

(1,611)

 

═════

═════

 

 

 

 

 

16         DEFERRED INCOME TAX

 

Deferred income tax assets relating to the accumulated tax losses of the Group's subsidiaries subject to corporate income tax in Vietnam have not been recognised due to uncertainties as to the timing of their recoverability. Estimated tax losses available for offset against future taxable income are as follows:

 

Years of expiration                                                                                                                

 

 

31 December 2018

30 June 2018

 

USD'000

USD'000

 

 

 

2019

-

13

2020

-

1,699

2021

-

210

2022

-

2,416

2023

-

550

 

─────

─────

 

-

4,888

 

═════

═════

 

17         LOSS AND NET ASSET VALUE PER SHARE

 

(a)        Basic

 

 

Six months ended

 

31 December

2018

31 December

2017

 

 

 

Net loss attributable to owners of the Company

 

 

 from continuing and total operations (USD'000)

(292)

(19,398)

Weighted average number of ordinary shares in issue

160,035,463

248,348,242

Basic loss per share from continuing and total

 

 

 operations (USD per share)  

(0.00)

(0.08)

 

──────────

──────────

 

(b)        Diluted

 

Diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares outstanding to assume conversion of all dilutive potential ordinary shares. The Group has no category of potential dilutive ordinary shares. Therefore, diluted earnings per share is equal to basic earnings per share.

 

(c)        Net asset value per share

 

 

31 December

2018

30 June

2018

 

 

 

Net asset value (USD'000)

525

46,931

Number of outstanding ordinary shares in issue

146,619,888

163,399,888

Net asset value per share (USD/share)

0.004

0.286

 

──────────

──────────

 

 

 

 

 

18         COMMITMENTS

 

As at 31 December 2018, the Group was not committed to any lease agreements (as at 30 June 2018: USD5,742).

 

19         RELATED PARTY TRANSACTIONS AND BALANCES

 

Management, disposal and alignment fees

 

The Group is managed by VinaCapital Investment Management Limited (the "Investment Manager"), an investment management company incorporated in the Cayman Islands.

 

Under the Third Amended and Restated Investment Management Agreement effective from 14 December 2016, no further management fees shall be charged by the Investment Manager to the Company (30 June 2017: nil). The Investment Manager receives a disposal fee and an alignment fee. The disposal fee is calculated at the rate of 3.00% of distributable funds realised in the year starting 22 November 2016, 2.75% in the second year and 2.25% in the third year. The alignment fee is calculated on distributions to shareholders over USD265.0 million during the 3-year period starting 22 November 2016. The Investment Manager will receive 10% of distributions over USD265.0 million and up to USD279.0 million, 15% of distributions over USD279.0 million, and up to USD313.0 million, and 20% of distributions over USD313.0 million. A non-refundable monthly advance of USD200,000 in the year starting 22 November 2016, USD150,000 in the second year, and USD100,000 in the third year, will be paid to the Investment Manager. These advances will be offset against disposal fees and alignment fees. During the period advances of USD0.8 million (30 June 2018: USD2.0 million) were paid and net off with disposal and alignment fees payable to the Investment Manager.

 

Details of disposal fees and alignment fees accrued at the balance date were as follows:

 

 

31 December 2018

30 June 2018

 

USD'000

USD'000

 

 

 

Disposal fees accrued

1

2,995

Disposal fees payable

1,887

733

Alignment fees accrued

37

7,766

Alignment fees payable

1,752

532

 

─────

─────

Total fees accrued/payables at period/year end

3,677

12,026

Advance payments to be offset against fees payable

-

-

 

─────

─────

Total disposal and alignment fees payable (*)

3,677

12,026

 

═════

═════

 

 

 

 

 

 

31 December 2018

30 June 2018

 

USD'000

USD'000

 

 

 

Opening balance (1 July 2018/1 July 2017)

12,026

11,538

Charge for the period/year (Note 13)

1,145

4,083

Amounts settled

(9,494)

(3,595)

 

Closing balance

──────

3,677

══════

──────

12,026

══════

 

Details of payables to related parties at the date of the condensed interim consolidated balance sheet are as below:

 

 

 

 

31 December 2018

30 June

2018

 

Relationship

Balances

USD'000

USD'000

 

 

 

 

 

 

VinaCapital Investment

 Management Ltd.

Investment Manager

Accrued disposal  and alignment fees

38

10,761

 

 

 

Disposal and alignment fees payable

3,639

1,265

 

 

 

 

 

 

 

VinaCapital Vietnam

 Opportunity Fund Limited ("VOF")

Under common management

Disposals of real estate projects

52

565

 

 

──────

──────

 

 

 

 

3,729

12,591

 

 

 

 

══════

══════

 

             

 

Advances to related parties as at 31 December 2018 were the non-refundable advances described under the section "Disposal fee and alignment fee" above.

 

 

 

 

 

The interests of the related parties in the shares, underlying shares and debentures of the Company are as follows:

 

 

As at

 

31 December

2018

30 June

2018

 

Number of shares

 

 

Asia Investment and Finance Ltd

30,376,000

-

Vietnam Investment Partners Ltd

22,286,457

22,286,457

VinaCapital Group Limited

608,553

608,553

 

─────────

─────────

 

 (*)   In accordance with the Second Amended and Restated Investment Management Agreement, the Investment Manager was required to use 50% of the realisation fee arising from the contracted divestment proceeds collected to make market purchases of the Company's ordinary shares within three months of the receipt of the realisation fee. The shares acquired are subject to lockups of between one and two year from the date of acquisition. As at 31 December 2018, there were no ordinary shares under lockup (as at 30 June 2018: 7,039,279 ordinary shares).

 

20         FINANCIAL RISK MANAGEMENT

 

(a)        Financial risk factors

 

The Group holds a diversified property portfolio in Vietnam. As a result the Group is exposed to a variety of financial risks: market risk (including price risk, currency risk and interest rate risk); credit risk; and liquidity risk. The Group's overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Group's financial performance. The Group's risk management is coordinated by its Investment Manager who manages the distribution of the assets to achieve the investment objectives.

 

The condensed interim consolidated financial statements do not include all financial risk management information and disclosures required in the annual consolidated financial statements, and should be read in conjunction with the Group's annual consolidated financial statements as at 30 June 2018. There have been no major changes in the risk management department of the Investment Manager and risk management policies since the most recent year end.

 

(b)        Fair value estimation

 

The table below analyses financial instruments carried at fair value by valuation method. The different levels have been defined as follows:

 

·      Quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1);

·      Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices) (Level 2); and

·      Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) (Level 3).

 

 

 

 

 

The following table presents the Group's assets and liabilities that are measured at fair value at 31 December 2018:

 

 

Level 1

Level 2

Level 3

Total

As at 31 December 2018

USD'000

USD'000

USD'000

USD'000

 

 

 

 

 

- Disposal fee and alignment fee

-

-

(3,677)

(3,677)

 

══════

══════

══════

══════

 

 

 

 

 

 

Level 1

Level 2

Level 3

Total

 

As at 30 June 2018

USD'000

USD'000

USD'000

USD'000

 

 

 

 

 

 

 

- Disposal fee and alignment fee

-

-

(12,026)

(12,026)

 

══════

══════

══════

══════

 

There were no significant transfers between levels during the period (year ended 30 June 2018: none).

 

 


This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
 
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