TIDMWSL
RNS Number : 0431O
Worldsec Limited
28 September 2023
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WORLDSEC LIMITED
Interim Report for the six months ended 30 June 2 023
Worldsec Limited
Interim Report for the six months ended 30 June 2023
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 2023
(the "Interim Report") .
For the period under review, the Group recorded an unaudited net
profit of US$717,000 (equivalent to basic and diluted earnings per
share of 0.84 US cent) against an unaudited net loss of US$526,000
(equivalent to basic and diluted loss per share of 0.62 US cent)
for the corresponding six months in 2022. This turn from loss to
profit reflected mainly the gain of US$917,000 (subject to audit)
arising from the disposal of the Group's entire investment in
Velocity Mobile Limited ("Velocity"), while at the same time there
was also a small positive change in the fair value of its financial
assets against a negative change during the previous corresponding
period .
The cash proceeds from the Velocity disposal, which were the
main reason behind the increase in the cash and cash equivalents
balance from US$526,000 at the beginning of the period under review
to US$1.25 million by the end of the period under review, are
intended to be used for general working capital and to fund future
investment acquisitions.
After the Group's disposal of its entire investment in Velocity,
at the date of the Interim Report, the investment portfolio of the
Group comprises a total of six 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 202 3 .
Animoca Brands Corporation Limited (" Animoca") through VS SPC
Limited ("VS SPC")
The Group holds an investment in the Class A Participating
Shares of 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 ("AI") 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 Animoca Brands
KK, GAMEE, nWay, Blowfish Studios, Grease Monkey Games, Darewise
Entertainment, Quidd, Lympo, Forj, Pixowl, Helix Accelerator, Eden
Games, Life Beyond Studios, Notre Game, TinyTap, Be., Anichess,
Gryfyn , Pixelynx and WePlay Media. Animoca is also an active
investor in crypto, blockchain-related and Web3 projects with a
broad and growing portfolio of over 450 investments that includes
OpenSea, a leading non-fungible token ("NFT") marketplace, Axie
Infinity, a popular Pokemon-inspired blockchain-based video game,
and Dapper Labs, the developer of CryptoKitties.
2022 was a trying year with major market events such as the
collapse of Terra, one of the largest stablecoin ecosystems, and
FTX, one of the largest cryptocurrency exchange platforms, which
devolved into a frighteningly bearish market for crypto assets. The
commencement of 2023, however, appeared to have brought a renewed
sense of optimism. Being a global leader in the crypto and NFT
industries, Animoca benefited from the price recoveries of major
cryptocurrencies and NFTs significantly. According to the Animoca's
11 May 2023 investor update, the Animoca group held on the 30 April
2023 cash and stablecoins totalling US$194 million, liquid digital
assets of US$566 million and off-balance sheet token reserves
related to majority-owned Web3 subsidiaries of US$2.7 billion. The
corresponding comparable figures at the end of December 2022 were
US$191 million, US$469 million and US$1.6 billion respectively.
Other highlights of the recent development and events of the
Animoca group include the following:
-- The Animoca group led OP3N's US$28 million Series A round of
funding at $100 million valuation in March 2023. OP3N aims to
bridge the gap between the Web2 and Web3 technologies by utilising
blockchain and decentralised technologies to build a cohesive
consumer-friendly Web3 platform. With the newly raised funds, OP3N
plans to further develop its comprehensive Web3 AI-powered chat,
Superapp. Superapp will have the ability to include audio, video
and mixed media contents to on-chain interactions, acting as a
one-stop for all communication, connection and commerce.
-- Animoca Brands KK, a strategic subsidiary of Animoca,
invested JPYen150 million in LMI, a company that provides various
consulting solutions for physical and virtual retailers. The
investment will help LMI accelerate its growth and expand its reach
in the retail media sector in Japan.
-- Following the acquisition of Tiny Tap in 2022, the Animoca
group continued to expand in the edtech sector by leveraging on
Tiny Tap's established Web2 code-free platform which enables
educators and publishers to create and share interactive
educational contents and to receive a revenue share when those
contents are used by learners. According to the latest available
figures, Tiny Tap's educational game library holds more than
250,000 activities created by educators and publishers including
Sesame Street and Oxford University Press, serving around 9.2
million registered members with contents created by over 100,000
content creators. In April 2023, Tiny Tap raised US$8.5 million
from investors including Sequoia Capital, Liberity City Ventures,
Shima Capital and others with a view to accelerating its
development in the Web3 space. In May 2023, both Animoca and Tiny
Tap committed to contribute to the Global Educators Fund, a US$10
million grant fund set up by Open Campus Protocol, to supplement
standard education curricula through the use of the Web3
technologies and communities. Open Campus is a community-led
protocol for educators, content creators, parents and students and
its vision is to leverage Web3 to create a modern, global and
inclusive educational space where educators, content creators,
parents and students can collaborate. In August 2023, Tiny Tap,
Open Campus and Code Green announced the formation of a strategic
partnership to help promote children's learning about climate
change by leveraging the power of tokenised educational contents,
interactive gaming and blockchain technologies. Code Green, a
partner to the United Nation's effort to combat climate change and
desertification, is a trail-blasing Web3 organisation driven by a
commitment to the planet's health.
-- Web3 financial super app and ecosystem, hi, and the Animoca
group forged a strategic partnership through a memorandum of
understanding, aiming to enhance the practicality of fungible
tokens and NFTs within their respective ecosystems. This
collaboration involves an investment of US$30 million by the
Animoca group in hi, along with joint efforts on various Web3
initiatives.
-- Anichess, a subsidiary of Animoca, successfully raised $1.5
million in an oversubscribed seed round of funding. The raised
capital would enable Anichess to fund the continued and further
development of its groundbreaking decentralised chess game, its
team expansion and its community growth.
-- In September 2023, the Animoca group received binding
commitments for a funding round to accelerate the development of
its Mocaverse project. Led by CMCC Global and supported by Kingsway
Capital, Liberty City Ventures, Koda Capital and others, the
funding of US$20 million was raised by Animoca via the issue of
Simple Agreements for Future Equity ("SAFE") and the grant of a
free-attaching utility token warrant on a 1:1 dollar basis. The
SAFE will be automatically converted into ordinary shares of
Animoca after six months. The number of new shares to be issued, at
AUD4.50 per share, will be determined by the AUD:USD exchange rate
at the time of settlement. The Mocaverse project is designed to
bring together all the Animoca group companies, employees, partners
and its portfolio investment companies under an ecosystem where all
participants get to connect, learn, interact and grow together.
-- Animoca has received prestigious recognitions from the crypto
and Web3 industries, among which include the following:
-- Fortune Crypto 40 ranked Animoca as a top venture capital
firm in the blockchain space with a focus on NFTs and gaming in
April 2023.
-- nft now, a Web3 digital media platform that empowers culture
creators, honored Animoca as one of the 2023 NFT100, a list of
influential creators and community leaders in the Web3
industry.
-- Mr. Yat SIU, the co-founder and executive chairman of Animoca
was selected by the Hong Kong Special Administrative Region
Government to join its task force to promote development and to
make recommendations concerning the responsible and sustainable
advancement of the Web3 technologies in Hong Kong.
Innovusion Holdings Ltd. (" Innovusion") through the Hermitage
Fund Twelve SP (the " Hermitage Fund Twelve")
The Group holds an investment in the Class A Participating
Shares of the Hermitage Galaxy Fund SPC attributable to 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 specialises in the development of image-grade light detection
and ranging ("LiDAR") sensor systems for the autonomous vehicle and
advance driver-assistance system markets. The Innovusion group has
developed a product portfolio that includes both long-range
front-view LiDAR sensors and mid-to-short range side-view LiDAR
sensors.
Since March 2022, the LiDAR sensors of the Innovusion group have
been used in many of the NIO's vehicles including the ET5, ET7,
ES6, ES7/EL7, ES8 and EC6 models. According to the LiDAR for
Automotive Report by Yole Group, an independent market research
firm, Innovusion led the L2 (partial driving automation) and L3
(conditional driving automation) markets in 2022 with a 27% market
share. All the NIO's NT2.0 platform-based vehicles are now equipped
with Falcon, the image-grade, ultra-long-range front-view LiDAR
sensor of the Innovusion group, as part of the standard
configuration.
Innovusion's strategic partnerships with several commercial
vehicle firms, including TuSimple, EaseControl Autonomous, Waytous
Technologies, Zhiji Tech and DeepWay, have solidified the Falcon
platform's central role in the commercial vehicle market. In March
2023, Innovusion obtained ISO 26262 certification for automotive
functional safety from DEKRA Certification. This certification is
pivotal in supporting the advancement of high-quality autonomous
driving industry practices, covering all aspects from design and
development to verification, production and operation.
In another recent development, Innovusion joined forces with
Wideye, a subsidiary of the AGC Group specialising in optical
sensor integration, to devise a groundbreaking LiDAR solution for
vehicles. This partnership is centered around the enabling of the
practical and aesthetically pleasing installation of LiDAR systems
behind windshields, a crucial advancement as the demand for
integrated LiDAR sensors surges in line with mass production
expansion.
Aiming for further growth, Innovusion has initiated an
application for an initial public offering on Nasdaq. This proposed
offering would involve the issue of up to 21.4 million Innovusion
shares for investors, as outlined in a 10 August 2023 announcement
on the China Securities Regulatory Commission website.
ByteDance Ltd. (" ByteDance") through the Homaer Asset
Management Master Fund SPC (the "Homaer Fund")
The Group holds an investment in the Unicorn Equity Investment
Portfolio Class A Shares of the Homaer Fund , the sole underlying
investment asset of which is an equity interest in ByteDance.
ByteDance is an unlisted holding company of a technology group
that operates a series of mobile application platforms powered by
AI 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 , among others, Douyin, Toutiao,
TikTok, Xigua Video and Helo.
The overseas business of the ByteDance group has shown robust
growth, outpacing the strong but slowing growth rate achieved by
its domestic operations as a result of the effect of a rapidly
growing base. The robust growth in overseas revenue has primarily
been contributed by TikTok, complemented by other international
ventures such as those in the video game and enterprise software
sectors.
TikTok has recently announced substantial investment plans for
Indonesia and other Southeast Asia countries given its strong
market presence in the region. Indonesia, in particular, has
emerged as a pivotal market for TikTok Shop with a large user base
actively participating in in-app shopping. TikTok has also been
reported to be in early-stage discussions with Indonesian
regulators about acquiring a payment license, a move that could
enhance its competitive position in Southeast Asian e-commerce.
While TikTok Shop has flourished in Southeast Asia, it faces
challenges in gaining widespread adoption in the West. As a
consequence, TikTok is refocusing its international expansion
efforts on markets, including the UK, US and Southeast Asia, where
its e-commerce service has been established. TikTok is also
introducing the "Trendy Beat" as part of the "Project S" to drive
e-commerce sales. This feature offers popular items from the videos
on TikTok to be sold by ByteDance through a Singapore-registered
company and shipped from China, allowing the ByteDance group to
capture the proceeds from the sales made through this TikTok
feature.
Meantime, AI has emerged as a prominent trend attracting
significant attention across the technology landscape. As reported
by the Financial Times, Baidu, ByteDance, Tencent and Alibaba have
been actively engaged in the acquisition of high-performance Nvidia
chips, essential for the development of generative AI systems.
These companies have collectively placed orders amounting to US$5
billion, driven by concerns of potential new export controls by the
United States. Beyond this, ByteDance continues to expand its
robotics capability, with a view to capitalising on the synergy
between large language model integration and robotics applications.
Spearheading the development in robotics and AI within the
ByteDance group, the Byte Robotics team, an integral part of the
Byte AI Lab, is tasked with the mission that includes refining and
optimising robots for e-commerce operations and streamlining
processes such as sorting, packaging and consumer delivery.
In August 2023, the ByteDance group introduced a new product
named Dou Bao, offering text and image-based conversational AI
capabilities akin to ChatGPT. Dou Bao aims to tap into the
burgeoning market of AI-generated contents, expected to exceed a
trillion US dollars in value over the next decade. It features
various AI personas for diverse purposes, including chatting,
writing and English learning, enabling users to engage in
multilingual conversations and create contents.
Following a wave of layoffs last year and a 32-month regulatory
scrutiny period, China's major technology companies are resuming
their expansion initiatives. Premier Li Qiang, in July 2023,
expressed the Government's commitment to addressing the concerns
and challenges faced by Internet companies while improving relevant
policies and measures to foster healthy and regulated development
within the Internet economy. This improvement in the operating
environment would enable the ByteDance group to refocus on pursuing
its growth trajectory.
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 a fresh grocery 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 with about
60 regional processing centres and about 1,100 frontline
fulfillment stations on leased properties . The operations of the
Dingdong group cover around 25 cities across China including
Beijing, Shanghai, Shenzhen and Guangzhou.
According to unaudited financial information released by
Dingdong, the Dingdong group reported revenue of RMB5.0 billion for
the first quarter of 2023 and RMB4.8 billion for the second quarter
of 2023, representing year-on-year decline of 8.2% and 27%
respectively. The decline in revenue, particularly during the
second quarter of 2023, reflected the high base effects of the
strong performance recorded in the same periods in the previous
year when pandemic-related restrictions significantly impacted
various regions across China, thus driving up demand for online
grocery shopping. Revenue was also adversely affected by the
Dingdong group's strategic decision to withdraw operations from
several cities where attaining profitability in the short term
would be difficult. Nevertheless, and notwithstanding the
normalised post-pandemic operating environment, the Dingdong group
continued to demonstrate resilience by achieving non-GAAP net
income of RMB 6.1 million and RMB 7.5 million during the first and
second quarters of 2023 respectively. This marked three consecutive
quarters of non-GAAP profitability since the fourth quarter of
2022, reflecting primarily the success of the Dingdong group in
achieving continued improvement in product development capabilities
and frontline fulfillment labour efficiencies.
In a strategic move to restructure its position across the
national market, the Dingdong group has, as mentioned earlier,
withdrawn operations from several cities with poor short-term
profit visibility while placing notable emphasis on the East China
region where operational and financial performance has shown
promising and propitious prospects. According to the second quarter
2023 financial results released by Dingdong, Shanghai has achieved
overall profitability since the first quarter of 2022. Furthermore,
both the Jiangsu and Zhejiang Provinces have displayed commendable
performance by maintaining three consecutive quarters of
profitability since the fourth quarter of 2022. In the context of
mature market growth, both of the provinces have recorded
double-digit year-on-year growth in daily order volume per station.
This underscores the success of the Dingdong group's strategy to
place emphasis on these two provinces to stimulate order volume.
Nonetheless, there remains potential for further improvement in
terms of order penetration and daily order volume per station in
the Jiangsu and Zhejiang Provinces when compared to the performance
metrics observed in Shanghai.
Dingdong has also outlined plans to bolster its operational
capabilities in both North and South China. These forthcoming
initiatives align with the commitment of the Dingdong group to
expanding its footprint and achieving sustainable growth in diverse
regional markets across China.
For the remaining quarters and for the full year of 2023,
Dingdong is confident on the ability of the Dingdong group to
continue to achieve non-GAAP profitability.
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.
Following the graduation of 138 pupils in the summer of 2023,
the Huizhou Kindergarten enrolled 79 new pupils for the academic
term that commenced in September 2023 and its total pupil enrolment
stood at 257.
With the steadily improving cash flow on the back of a stable
operational performance and after repaying RMB400,000 in December
2021, the Huizhou Kindergarten made another repayment of RMB600,000
to Oasis Shenzhen in April 2023 to retire part of its borrowings
which were related to the set-up costs incurred at the time when
the kindergarten was established.
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 established a leading position in the digital concierge
market with a rapidly growing track record, the Velocity group
attracted the attention and interest that eventually led to a
takeover offer to acquire the entire issued share capital of
Velocity by Capital One Financial Corporation ("Capital One"), one
of the largest retail banks in the United States specialising in
credit cards, automobile loans and savings accounts. The
acquisition was completed in June 2023. Under the takeover offer
from Capital One, the Group disposed of its entire investment in
Velocity. Almost all of the proceeds from the Velocity disposal had
been received before 30 June 2023. The balance, subject to any
downward-only adjustment Capital One is entitled to deduct, will be
settled in the first quarter/half of 2024.
The gain of US$917,000 (subject to audit) arising from the
disposal of the Group's entire investment in Velocity was the major
factor that contributed to the turn from loss to profit reported by
the Group during the period under review. The cash proceeds from
the Velocity disposal are intended to be used for general working
capital and to fund future investment acquisitions.
PROSPECTS
Global trade returned to growth in the first three months of
2023 after two consecutive quarterly decline in the second half of
2022. According to the Global Trade Update by the United Nations
Conference on Trade and Development in June 2023, trade of goods
and services in seasonally adjusted values was estimated to have
risen by 1.9% and 2.9% respectively in the first quarter of 2023
when compared to the fourth quarter of 2022. However, the rebound
appeared to have started fading in the second quarter of 2023 and
global trade growth for the rest of 2023 is expected to remain
weak. This unfavourable outlook is echoed in the World Economic
Outlook Update by the International Monetary Fund which projects
global economic growth to fall from 3.5% in 2022 to 3.0% in 2023.
Continued uncertainties over the path of interest rates, inflation,
geopolitics and the uncompromising war between Russia and Ukraine
are the major negative factors of concern. Although the headline
inflation is estimated by the International Monetary Fund to fall
from 8.7% in 2022 to 6.8% in 2023 and 5.2% in 2024, it is still
well above the core target of 2% set by the major developed
economies indicating that interest rates will likely remain at high
levels for a longer period of time.
The recent adoption of the narrative of "de-risking" rather than
"decoupling" by the West in their political and economic approach
towards China appears that the West have taken a more moderate
stance. However, in practice, to implement "de-risking" could take
different forms. Some countries will focus on political issues
under the national security banner while others will be more
concerned about economic matters such as the diversification of
supply chains and the resistance to economic coercion. Without a
clear and generally recognised definition of "de-risking", such an
approach will be subject to different interpretations by different
countries, thereby creating divergence and not consensus in
"de-risking" policies and measures, hence adding to further
uncertainties. Nonetheless, the "de-risking" strategy of the West
towards China, so far as China is concerned, is likely to be no
more than a "selective decoupling of choice" and the ultimate
objective of the West in containing China's development is expected
to remain unchanged. In the absence of geopolitical harmony, there
will be structural changes to global trade that would not be
conducive to economic growth across the globe.
The private equity market in the first half of 2023 remained
challenging under the backdrop of the uncertainties surrounding the
global economic outlook that continued to weigh on investment
sentiment. The abrupt end of the low interest rate era experienced
in the last 15 years has put pressure on the financial system
worldwide, especially on the banking sector. Corporations have not
only encountered difficulties in obtaining new fundings but are
also facing problems in their refinancing negotiations as banks
tighten their lending policies. The real estate and the technology
sectors are among the most affected. Likewise, fundings from the
public markets through initial public offerings and issuance of
bonds and leveraged loans also showed significant decline. As these
traditional sources of fundings become less accessible, private
equity firms, with their unprecedented dry powder reserves of over
US$3.5 trillion that continues to drive competition for quality
investments, are presented with opportunities to negotiate deals at
lower valuations. Nevertheless, given the cautious investment
sentiment, deal volume in the first half of 2023 declined by 4%
from the relatively subdued levels recorded in the second half of
2022 but still remained above the pre-pandemic 2019 levels
according to PWC's 2023 Mid-Year Update on Global M&A Industry
Trends.
Following the uplift of the COVID-19 lockdown measures at the
beginning of 2023, China's economy was expected to recover
strongly. But the recovery fell short of the bullish expectation as
the initial momentum lost steam on the back of weakening domestic
and external demand. Latest figures, however, indicate that the
slowdown in economic growth seems to be stablising under policy
support notwithstanding the persistent woes of the real estate
sector. As the majority of the investments and underlying
investment assets of the Group are largely China-focused, their
near-term prospects do not appear to be particularly promising in
that they are unlikely to produce any meaningful contributions to
the Group's results in the near term. Nonetheless, the Board
remains confident on the long-term potential of these investments
and underlying investment assets which are well-placed to benefit
from the strength of China's economy in the long term. Meantime,
the disposal of the Group's entire investment in Velocity has
provided the Group with additional wherewithal which will be used
for general working capital purposes and to fund future investment
opportunities as and when they are identified.
By order of the Board
Alastair GUNN-FORBES
Non-Executive Chairman
28 September 2023
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 2023 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 14 and 15 of the
Company's 2022 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 2023 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
2023, 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 2023
Unaudited
Six months ended
Notes 30.6.2023 30.6.2022
US$'000 US$'000
Revenue 4 48 59
Other income, gains and losses, net 5 941 (278)
Staff costs 7 (132) (131)
Other expenses (136) ( 173 )
Finance costs 8 (1) (2)
Share of losses of a joint venture (3) (1)
)
)
---------- --------------
Profit/(loss) before income tax expense 717 (526)
Income tax expense 9 - -
---------- --------------
Profit/(loss) for the period 717 (526)
========== ==============
Other comprehensive income, net of income tax
Exchange differences on translating foreign operations - -
Other comprehensive income for the period,
net of income tax - -
---------- --------------
Total comprehensive income/(loss) for the period 717 (526)
========== ==============
Profit/(loss) for the period attributable to:
Owners of the Company 717 (526)
========== ==============
Total comprehensive income/(loss) for the period attributable to:
Owners of the Company 717 (526)
========== ==============
Earnings/(Loss) per share - basic 10 US0.84 US(0.62) cent
cent
========== ==============
Earnings/(Loss) per share - diluted 10 US0.84 US(0.62) cent
cent
cue
cent
========== ==============
The accompanying notes form an integral part of these interim
financial statements.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AT 30 JUNE 2023
Unaudited Audited
As at As at
Notes 30.6.2023 31.12.2022
US$'000 US$'000
Non-current assets
Interest in a joint venture 68 71
Financial assets at f air value through profit or loss 4,128 4,409
Right-of-use assets 16 48
4,212 4,528
---------- -----------
Current assets
Other receivables 321 223
Deposits and prepayments 27 26
Financial assets at f air value through profit or loss 161 97
Amount due from a joint venture 257 257
Cash and cash equivalents 1,247 526
---------- -----------
2,013 1,129
---------- -----------
C urrent liabilities
Other payables and accruals 44 160
Lease liabilities 18 55
---------- -----------
62 215
---------- -----------
Net current assets 1,951 914
---------- -----------
Non-c urrent liabilities
Lease liabilities - -
---------- -----------
Net assets 6,163 5,442
========== ===========
Capital and reserves
Share capital 11 85 85
Reserves 6,078 5,357
---------- -----------
Total equity 6,163 5,442
========== ===========
The accompanying notes form an integral part of these interim
financial statements.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTHSED 30 JUNE 2023
Foreign
Contri- Share currency Accumu-
Share Share buted option translation Special lated
capital premium surplus reserve reserve reserve losses Total
US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
Balance as
at 1 January
2022 85 7,524 9,646 249 (6) 625 (11,811) 6,312
Loss and total
comprehensive
loss for the
period - - - - - - (526) (526)
Balance as ( 12
at 30 June 7 , , 337
2022 (Unaudited) 85 524 9,646 249 (6) 625 ) 5, 786
======= ======= ======= ======= =========== ======= ======== =======
Balance as
at 1 January
2023 85 7,524 9,646 249 (33) 625 (12,654) 5,442
Profit and
total comprehensive
income for
the period 717 717
Recognition
of share-based
payments - - - - - - 4 4
Balance as
at 30 June
2023 (Unaudited) 85 7,524 9,646 249 (33) 625 (11,933) 6,163
==== ======= ======= === ==== === ======== =====
The accompanying notes form an integral part of these interim
financial statements.
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE SIX MONTHSED 30 JUNE 2023
Unaudited
Six months ended
30.6.2023 30.6.2022
US$'000 US$'000
C ash flows from operating activities
Profit/(loss) for the period 717 (526)
Adjustments for:
Bank interest income (1) -
Depreciation of right-of-use assets 32 32
Interest on lease liabilities 1 2
3 1
Share of losses of a joint venture
(Gain)/loss on disposal of financial assets at fair value through (917) 20
profit or loss
Change in fair value of financial assets at fair value through profit or loss (26) 270
---------- ----------
Operating loss before working capital changes (191) (201 )
(Increase) in deposits and prepayments (1) (1)
(Increase)/decrease in other receivables (98) 90
(Decrease) in other payables and accruals (116) (72)
---------- ----------
Net cash used in operating activities (406) (184)
---------- ----------
C ash flows from investing activities
Bank interest income received 1 -
Investment in financial assets at fair value through profit and loss (83) (1,188)
Proceeds from disposal of financial assets at fair value through
profit or loss 1,247 598
Net cash from/(used in) investing activities 1,165 (590)
---------- ----------
C ash flows from financing activities
Repayment of principal portion of lease liabilities (37) (35)
Repayment of interest portion of lease liabilities (1) (2)
---------- ----------
Net cash used in financing activities (38) (37)
---------- ----------
N et decrease in cash and cash equivalents 721 (811)
C ash and cash equivalents at beginning of the period 526 1,513
Effects of exchange rate changes - -
C ash and cash equivalents at end of the period
Cash and bank balances 1,247 702
========== ==========
The accompanying notes form an integral part of these interim
financial statements.
NOTES TO THE INTERIM FINANCIAL STATEMENTS
FOR THE SIX MONTHSED 30 JUNE 2023
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
2023 (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
2022. 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 2023, 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
2022.
The Interim Financial Statements have been prepared on a going
concern basis using the historical cost convention, 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 2022, except that it has adopted the
following amendments to IFRSs:
Amendments to IAS 1 Disclosure of Accounting Policies
and
IFRS Practice Statement
2
Amendments to IAS 8 Definition of Accounting Estimates
Amendments to IAS 12 Deferred tax related to assets and liabilities
arising from a single transaction
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 2023 and 2022, an analysis of which is as follows:
Unaudited
Six months ended
30.6.2023 30.6.2022
US$'000 US$'000
Dividend income from financial assets
at fair value through profit or loss 48 59
========== ==========
5. OTHER INCOME, GAINS AND LOSSES, NET
Unaudited
Six months ended
30.6.2022 30.6.2022
US$'000 US$'000
Gain/(loss) on disposal of financial
assets at fair value through profit
or loss 917 (20)
Change in fair value of financial
assets at fair value through profit
or loss 26 (270)
Interest Income
Foreign exchange (loss)/gain, net 1 -
Other (3) 6
- 6
---------- ----------
941 (278)
========== ==========
6. BUSINESS AND GEOGRAPHICAL SEGMENTS
No business and geographical segment analyses are presented for
the periods ended 30 June 2023 and 2022 as the major operations and
revenue of the Group arose from Hong Kong. The Board considers that
most of the Group's non-current assets (other than the financial
instruments) were located in Hong Kong.
7. STAFF COSTS
The aggregate staff costs (including directors' remuneration)
of the Group were as follows:
Unaudited
Six months ended
30.6.2023 30.6.2022
US$'000 US$'000
Wages and salaries 129 128
Contributions to pension and provident
fund 3 3
----------- ----------
132 131
=========== ==========
NOTES TO THE INTERIM FINANCIAL STATEMENTS
FOR THE SIX MONTHSED 30 JUNE 2023
7. STAFF COSTS (CONTINUED)
Key management personnel of the Company are the directors
only.
The directors' remuneration was as
follows:
Unaudited
Six months ended
30.6.2023 30.6.2022
US$'000 US$'000
Directors' fees 38 36
Other remuneration including contributions
to pension and provident fund - -
38 36
========== ==========
8. FINANCE COSTS
Unaudited
Six months ended
30.6.2023 30.6.2022
US$'000 US$'000
Interest on lease liabilities 1 2
========== ==========
9. INCOME TAX EXPENSE
No provision for taxation has been made as the Group did not
generate any assessable profits for United Kingdom Corporation Tax,
Hong Kong Profit s Tax or tax in other jurisdictions during the
periods ended 30 June 2023 and 2022.
10. EARNINGS/(LOSS) PER SHARE
The earnings/(loss) and weighted average number of ordinary
shares used in the calculation of basic and diluted earnings/(loss)
per share were as follows.
Unaudited
Six months ended
30.6.2023 30.6.2022
Earnings/(loss) for the period attributable
to owners of the Company (US$'000) 717 (526)
============= =============
Weighted average number of ordinary
shares for the purposes of basic and
diluted earnings/(loss) per share 85,101,870 85,101,870
Effect of potential dilutive ordinary
shares: - -
* Share options
------------- -------------
85,101,870 87,151,870
============= =============
Earnings/(loss) per share - basic US0.84 cent US(0.62)
cent
============= =============
Earnings/(loss) per share - diluted US0.84 cent US(0.62)
cent
============= =============
NOTES TO THE INTERIM FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2022
10. EARNINGS/(LOSS) PER SHARE (CONTINUED)
Diluted earnings/(loss) per share was the same as basic
earnings/(loss) per share for the six months ended 30 June 2023 and
2022 as the impact of the potential dilutive ordinary shares
outstanding had an anti-dilutive effect on the basic
earnings/(loss) per share presented for the six months ended 30
June 2023 and 2022.
11. SHARE CAPITAL
Number of Total value
shares US$'000
Authorised:
Ordinary shares of US$0.001 each
As at 1 January 2022, 31 December
2022, 1 January 2023 and
30 June 2023 60,000,000,000 60,000
================= ============
Called up, issued and fully paid:
Ordinary shares of US$0.001 each
As at 1 January 2022, 31 December
2022, and 1 January 2023 and 30 June
2023 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 2023 and 2022.
Compensation of key management personnel
The remuneration of directors is set out in note 7 to the
Interim Financial Statements.
13. SHARE_BASED PAYMENTS
The Company operates an equity-settled share-based remuneration
scheme for the employees and directors.
On 20 February 2023, the Company granted 350,000 share options
to Mr. Willis to subscribe on a one for one basis new ordinary
shares of US$0.001 each in the share capital of the Company at an
exercise price of US$0.034 per share under the scheme. The share
options vested six months from the date of grant and were then
exercisable within a period of 9.5 years.
The following table discloses the movement of the outstanding
share options under the scheme during the period ended 30 June
2023.
NOTES TO THE INTERIM FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2022
13. SHARE_BASED PAYMENTS (CONTINUED)
Number of options
-------------------------------------------------------------------------------
Exercise
Balance Granted Exercised Forfeited Lapsed Balance price
at during during during during at per
Exercisable 1 January the the the the 30 June share
Grantee period 2023 year year year year 2023 (US$)
----------- -------------- ----------- -------- ---------- ---------- -------- ----------- ---------
20 August
2023 to
19 February
2033 - 350,000 350,000 0.034
29 November
2019 to
28 May
2029
1,750,000 - - - - 1,750,000 0.034
1 June
2016 to
30 November
Directors 2025 2,500,000 - - - - 2,500,000 0.122
29 November
2019 to
28
May 2029
300,000 - - - - 300,000 0.034
1 June
2016 to
30 November
Employees 2025 450,000 - - - - 450,000 0.122
----------- -------- ---------- ---------- -------- -----------
5,000,000 350,000 - - - 5,350,000
=========== ======== ========== ========== ======== ===========
The fair value of the share options granted under the scheme
during the period ended 30 June 2023 was determined at the grant
date to be US$5,000.
The share-based payment expenses of US$4,000 was charged to the
profit or loss account for the Group during the period ended 30
June 2023.
No share option was exercised, expired or lapsed under the
scheme during the period ended 30 June 2023.
14. CONTINGENT LIABILITIES
The Group had no material contingent liabilities at 30 June 2023
and 31 December 2022.
15. INTERIM REPORT
The Interim Report was approved and authorised for issue by the
Board on 28 September 2023.
CORPORATE INFORMATION
Board of D irectors
Non-Executive Chairman
Alastair GUNN-FORBES*
Executive D irector s
Henry Ying Chew CHEONG (Deputy Chairman)
Ernest Chiu Shun SHE
Non- E xecutive D irectors
Mark Chung FONG*
Martyn Stuart WELLS*
Stephen Lister d'Anyers WILLIS*
* independent
Company S ecretary
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 O ffice A ddress
Victoria Place, 5th Floor, 31 Victoria Street, Hamilton HM 10,
Bermuda
Registration N umber
EC21466 Bermuda
Principal B anker
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 S hare R egistrar and T ransfer O ffice
Ocorian Management (Bermuda) Limited
Victoria Place, 5th Floor, 31 Victoria Street, Hamilton HM 10,
Bermuda
International B ranch R egistrar
Link Market Services (Jersey) Limited
12 Castle Street, St Helier, Jersey, JE2 3RT, Channel
Islands
United Kingdom T ransfer A gent
Link Group
10(th) Floor, Central Square, 29 Wellington Street, Leeds, LS1
4DL, United Kingdom
Investor R elations
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
Central, Sheung Wan, Hong Kon g
enquiry@worldsec.com
Company's Website
http://www.worldsec.com
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END
IR NKFBNNBKDKCB
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September 28, 2023 09:33 ET (13:33 GMT)
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