DATAPULSE TECHNOLOGY LIMITED ANNUAL REPORT 2021
CONTENTS
01 CHAIRMAN'S STATEMENT
- REVIEW OF OPERATIONS AND FINANCIAL PERFORMANCE
- FINANCIAL HIGHLIGHTS
- BOARD OF DIRECTORS
- FINANCIAL CONTENTS
2021 ANNUAL REPORT | DATAPULSE TECHNOLOGY LIMITED | 01 | |
CHAIRMAN'S
STATEMENT
Dear Shareholders,
On behalf of the Board of Directors of Datapulse Technology Limited (the "Company", together with its subsidiaries, collectively the "Group"), I am pleased to present to you the Annual Report for the financial year ended 31 July 2021 ("FY2021").
FY2021 continues to be a challenging year for the Group. Since the outbreak of the COVID-19 pandemic more than a year ago, the situation remains uncertain amid rising concerns over the Delta variant of the virus. Despite the ongoing vaccination programmes around the world, many countries are still struggling to control the pandemic with continued lockdowns or tighter restrictions imposed.
Amid tighter social-distancing restrictions and minimal inbound tourism in Seoul, South Korea, we swiftly pivoted our hotel Travelodge Myeongdong City-Hall ("TLMC") into a residential style accommodation since November 2020, focusing on the domestic long stay segment. Our change in business strategy successfully enabled the Group to come out with a reduced loss. TLMC consistently outperforms the neighbouring hotels within the vicinity. With the change to the residential style accommodation, we were also able to further streamline operating costs by reducing the manning level at the hotel, taking into account that room services are no longer provided during this period.
With regards to the Group's 2 minority hotel investments, the hotel located in Singapore is currently undergoing renovations which is expected to be completed by the first quarter of 2022. The hotel located in Myeongdong Euljiro was converted into a COVID-19 quarantine facility since July 2021 and is expected to continue operating in the same manner over the next few months, depending on the COVID-19 situation in Seoul.
The cost-containment measures at the corporate level continue to be in place which includes reduced Directors' fees for FY2021 and reduced compensation packages for management staff.
DIVIDEND
Given the Group's current loss position for FY2021 and the uncertainty surrounding COVID-19, the Group has to take on a prudent approach with regards to cost containment measures and conserving cash to fund its operations. The Board is not recommending the payment of a dividend for FY2021.
02 | DATAPULSE TECHNOLOGY LIMITED | 2021 ANNUAL REPORT | |
CHAIRMAN'S
STATEMENT
BUSINESS OUTLOOK
The Group's hotel operations in Seoul, South Korea is expected to improve over the next reporting period. The Korean government has announced the lifting of stringent anti-coronavirus curbs on social gatherings, as the country prepares to switch to a "living with COVID-19" strategy amid rising vaccination levels. International travel will also likely pick up as border restrictions ease over time. As a start, people vaccinated against Covid-19 will be able to travel between Singapore and South Korea without quarantine from 15 November 2021.
In the interim, the Group will continue to closely monitor the situation in Seoul and optimise its hotel operations to maximise hotel revenue when the market picks up. Proactive cost management initiatives continue to be in place such as shortened work hours, headcount reductions and tapping on government subsidies related to payroll and business operations, to mitigate the impact of COVID-19.
Looking ahead, the Group will actively seek and evaluate investment opportunities in spite of the COVID-19 pandemic. We believe the COVID-19 situation will continue to improve and it may be an opportune time to acquire undervalued businesses and assets with strong recovery potential. We will look into leveraging on our expertise and resources in the hospitality sector to achieve our investment objectives.
APPRECIATION
On behalf of the Board of Directors, I would like to extend my sincere appreciation to our shareholders, business partners, and all our stakeholders for their support in this challenging times. I would also like to thank our management team for their hard work and dedication throughout the year as they continue to ride through the COVID-19 crisis together with the Group.
AW CHEOK HUAT
NON-INDEPENDENT
NON-EXECUTIVE CHAIRMAN
2021 ANNUAL REPORT | DATAPULSE TECHNOLOGY LIMITED | 03 | |
REVIEW OF OPERATIONS
AND FINANCIAL PERFORMANCE
REVIEW OF OPERATIONS AND FINANCIAL PERFORMANCE
FINANCIAL PERFORMANCE
The Group's revenue is contributed by 3 business segments; namely the hotel operations, asset management and investment trading segments.
The Group recorded total revenue of $1.0 million in year ended 31 July 2021 ("FY2021"). The hotel operations business contributed $0.6 million, while asset management fees and investment income each contributed $0.2 million.
Hotel operations revenue decreased from $1.9 million in year ended 31 July 2020 ("FY2020") to $0.6 million in FY2021 as the COVID-19 cases in Seoul, South Korea, remain high throughout the financial year with minimal inbound tourism. In the short to mid-term, the hotel will continue to focus on offering residential style accommodation for long stay guests as the Group closely monitors the COVID-19 situation. Asset management fees decreased from $0.5 million in FY2020 to $0.2 million in FY2021 due to the apportionment of income earned for FY2020 and FY2021.
Other income for the Group amounted to $0.7 million for FY2021, consisting mainly of interest income from banks and grant income.
The decrease in staff costs from $1.9 million in FY2020 to $1.3 million in FY2021 was mainly due to the reduction in hotel head counts and reduced compensation for management at the corporate office. Depreciation cost of $1.3 million for FY2021 came mainly from depreciation charge on the freehold building, renovation works and right-of-use assets. Finance costs of $0.9 million was mainly from the interest expense arising from term loan facility obtained for the acquisition of TLMC.
Hotel operating costs decreased from $1.3 million in FY2020 to $0.3 million in FY2021 as the hotel was temporarily closed since May 2020 and converted into the residential style accommodation which incurred significantly lower operating costs.
Other operating expenses decreased from $2.1 million in FY2020 to $1.5 million in FY2021 mainly due to cost savings from professional fees incurred by the Group as there were no new hotel acquisitions in the year and operations has scaled down significantly.
Tax expense of $0.1 million relates to the recognition of tax liabilities for certain subsidiaries in the Group.
As a result of the above, the Group's loss attributable to shareholders was $3.7 million in FY2021 against a loss of $5.8 million in FY2020. This $3.7 million loss included a one-off impairment loss of $1.9 million on TLMC arising from the impact of COVID-19 on the global hospitality sector.
FINANCIAL POSITION
Property, plant and equipment increased from $44.2 million as at 31 July 2020 to $46.1 million as at 31 July 2021 due to foreign exchange movement and capitalised renovation costs for TLMC of approximately $2.9 million, which was partially offset by depreciation charge of $1.0 million.
Right-of-use assets of $0.1 million as at 31 July 2021 mainly relates to the Group's office lease.
Investment securities of $3.1 million as at 31 July 2021 relate to a 15% minority interest in a hotel in Seoul, South Korea, and a 5% minority interest in a hotel in Singapore.
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Datapulse Technology Ltd. published this content on 25 October 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 25 October 2021 02:13:01 UTC.
