Fiscal Year 2020 Highlights:
- Revenues from the Company's investment in restaurant operations (
HFL Limited ) of$3.11 million for the year (FY2019:$2.0 million for the seven months from HFL's acquisition onNovember 30, 2018 to year end); - A loss before tax from continuing operations of
$4.07 million for the year (FY2019: loss of$3.56 million ), which includes impairment losses of$0.77 million recognized on HFL's assets due to the uncertain operating environment following the outbreak of COVID-19; - A loss attributable to shareholders of the Company from continuing operations amounting to
$3.41 million (FY2019: loss of$3.35 million ); - A share of loss of an associate of
$1.22 million for the year, representing results from the Company's primary investment in financial services throughSunwah Kingsway Capital Limited (FY2019: a share of loss of an associate of$1.01 million ); - Cost of sales for
Sunwah International's Restaurant Operations investment,HFL Limited , of$0.95 million (FY2019:$0.58 million from date of acquisition onNovember 30, 2018 to year end); - Selling, general and administrative expenses of
$3.82 million in FY2020 withHFL Limited accounting for approximately$2.89 million , including depreciation and amortization (FY2019:$2.87 million total with$1.83 million from the operation of HFL).
"
With respect to
In terms of the year ahead,
Financial Overview:
In accordance with the Company's refocused investments,
Financial Services Division – This division comprises the results from the Company's remaining interest (26.05%) in Sunwah Kingsway Capital Holdings Limited, its former principal subsidiary and now main investment interest (now accounted for as an associate under the equity method of accounting).
FY2020 highlights:- A loss on the partial disposal of
$438,000 in FY2020, representing the results of the partial disposal of SWK inDecember 2019 . This corresponds with a gain on the partial disposal of$83,000 in FY2019 in respect of a debt settlement transaction in which the Group settled debentures and a loan by transferring shares of SWK inJuly 2018 ; - A loss on the deemed partial disposal of SWK amounting to
$119,000 (FY2019:$117,000 ) in relation to a scrip dividend arrangement wherein the Company elected to receive a cash dividend, which resulted in further dilution of its interest in SWK from 26.47% to 26.05% (FY2019: 28.36% to 27.90%); - Share of losses totaling
$1.22 million , which compares year-over-year with$1.01 million ; - SWK's FY2020 declines in comparison with FY2019 are mainly the result of a decrease in commission and fee income and the impairment losses on financial instruments amid the region's social unrest in Fiscal 2020, geopolitical tensions between the
U.S. andChina affecting global markets, and fallout from the COVID-19 pandemic during the latter four months of the year. - Restaurant Operations – This division encompasses
Sunwah International's activities in the restaurant business following its acquisition ofHFL Limited , an Asian food and beverage company operating a premium Chinese seafood restaurant in Hong Kong. FY2020 highlights: - A loss of
$1.48 million for the year (FY2019: a loss of$0.74 million ), which comprises$0.77 million in impairment charges on HFL's assets due to the uncertain operating environment following the outbreak of COVID-19; - Revenues for the year of
$3.11 million (FY2019:$2.0 million from HFL's acquisition onNovember 30, 2018 to year end); - Cost of sales of
$0.95 million for the year, representing the cost of inventories used (FY2019:$0.56 million for the seven months from HFL's acquisition to year-end); - General, selling and administration expenses of
$2.11 million for the year (FY2019:$1.62 million for the seven months from HFL's acquisition to year end), which includes staff costs (wages and allowances, pension costs, employee benefits etc.) of approximately$1.41 million for the year (FY2019:$0.97 million from HFL's acquisition in November through year end); - Depreciation and amortization amounted to
$0.78 million for the year, against$0.21 million in FY2019. Following the adoption of IFRS 16 "Leases" for FY2020, the Group recognized a right-of-use asset and a corresponding lease liability with respect to its restaurant lease. Depreciation of right-of-use assets amounted toUS$0.44 million in FY2020 and are recognized and included in the depreciation and amortization expenses while the related property lease payments amounting toUS$0.26 million were included in the general, selling and distribution expenses in FY2019. - Strategic Investments and other activities – This division includes strategic investments, proprietary investments and other activities of the Group. FY2020 highlights:
- A net loss of
$0.82 million in FY2020 (FY2019: loss of$1.78 million ); - A net fair value gain of
$81,000 on financial assets at fair value through profit or loss, which compares with a loss of$632,000 in FY2019; - Selling, general and administrative expenses of
$0.93 million for the year against$1.04 million for FY2019. - Discontinued Operations of Technology Products and Services – This division includes the operations of
Pop Electronic Products Limited andDacEasy (H.K.) Limited , two technology investments the Company recently divested itself of in Q4 FY2019. This segment is included in the Company's results for year-over-year comparison purposes. - A loss of
$54,000 was recorded in Fiscal 2019 (FY2020: N/A).
Future Prospects
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Forward-Looking Statements
This press release announcing the financial results for
This press release contains certain statements that reflect management's expectations and objectives for the Company's future performance, opportunities and growth, which statements constitute "forward–looking information" and "forward-looking statements" (collectively "forward-looking information") under applicable securities laws. Such statements, other than statements of historical fact, are predictive in nature or depend on future events or conditions. Forward-looking information involves estimates, assumptions, judgments and uncertainties. These statements may be identified by the use of forward–looking terminology such as "may", "will", "should", "anticipate", "expect", "believe", "predict", "estimate", "continue", "intend", "plan" and variations of these words or other similar expressions. Specifically, this press release includes forward-looking information in respect of
Except as required by applicable law, management and the board of directors of the Company (the "Board of Directors") undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
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