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Vietnam Infrastr Ltd (VNI)

  Print      Mail a friend       Annual reports

Friday 16 March, 2012

Vietnam Infrastr Ltd

Interim Results

RNS Number : 5443Z
Vietnam Infrastructure Limited
16 March 2012
 



Vietnam Infrastructure Limited

 

Interim results for the six months ended 31 December 2011

 

Vietnam Infrastructure Limited (the "Company" or "VNI") (VNI.L), the first publicly traded fund to focus on infrastructure assets in Vietnam, today announces its interim results for the six months ended 31 December 2011 ("the Period").

 

Financial highlights

 

·      Net loss for the Period of USD16.8 million (HY10: USD26.7 million net loss).

·      Net loss per share of USD0.04 for the Period (HY10: USD0.07 net loss per share).

·      Cash and cash equivalents as at 31 December 2011 of USD57.1 million.

·      Net asset value at 31 December 2011 of USD182.6 million representing USD0.46 per share.

 

Operational highlights

 

·      VNI secured its first tenant at the Ba Thien II Industrial Park, just outside Hanoi, and commenced land-levelling in December.

·      South East Asia Telecommunications Holdings (SEATH), a fully owned subsidiary of VNI, gained controlling stakes in three portfolio companies and began the consolidation of these assets.

·      Nam Viet Oil, Vietnam's only private condensate refinery in which VNI holds a 23% stake, began building a retail distribution network in the Mekong Delta area with the aim of expanding its customer base.

 

Commenting, Paul Cheng, Chairman of Vietnam Infrastructure Limited, said:

"The macro economic conditions in Vietnam continue to present a challenging environment for investment activity.  Having said this, currency stabilisation and decelerating inflation in the second half of 2011, driven by Vietnam's new monetary policies, give us cause for some optimism.  Against this difficult backdrop, we are actively looking to diversify the scope of our investments, particularly in agribusiness, and hope to capitalise on the very attractive valuations of high quality distressed assets."

 

Notes to Editors:

 

VinaCapital is the leading investment management and real estate development firm in Vietnam, with a diversified portfolio of USD1.6 billion in assets under management. VinaCapital was founded in 2003 and boasts a team of managing directors who bring extensive international finance and investment experience to the firm. Our mission is to produce superior returns for investors by using our experience and knowledge to identify the key trends and opportunities that emerge as Vietnam continues to develop its economy. To achieve this, VinaCapital has industry-leading asset class teams covering capital markets, private equity, fixed income, venture capital, real estate and infrastructure.


VinaCapital manages three closed-end funds trading on the AIM Market of the London Stock Exchange. These funds are: VinaCapital Vietnam Opportunity Fund Limited (VOF), VinaLand Limited (VNL), and Vietnam Infrastructure Limited (VNI). VinaCapital also co-manages the USD32 million DFJ VinaCapital L.P. technology venture capital fund with Draper Fisher Jurvetson.


VinaCapital has offices in Ho Chi Minh City, Hanoi, Danang, Nha Trang, Phnom Penh (Cambodia) and Singapore. More information about VinaCapital is available at
www.vinacapital.com

 

More information on Vietnam Infrastructure Limited is available at www.vinacapital.com/vni

 

Enquiries:

 

David Dropsey
VinaCapital Investment Management Limited
Investor Relations/Communications
+84 8 821 9930
david.dropsey@vinacapital.com

 

Philip Secrett

Grant Thornton Corporate Finance, Nominated Adviser

+44 (0)20 7583 5100

philip.j.secrett@uk.gt.com

 
Hiroshi Funaki
LCF Edmond de Rothschild Securities, Broker
+44 20 7845 5960
funds@lcfr.co.uk


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

Mark Walters
FTI Consulting, Public Relations (Hong Kong)
+852 3716 9802
mark.walters@fticonsulting.com


Andrew Walton
FTI Consulting, Public Relations (London)
+44 (0)20 7269 7204
andrew.walton@fticonsulting.com

 

 

Chairman's Statement

 

Dear Shareholders,

 

We are pleased to present the interim results of Vietnam Infrastructure Limited (AIM: VNI) for the six month period ended 31 December 2011.

 

During the final six months of 2011, Vietnam's economic growth slowed to finish the year at 5.9 percent. More importantly though, inflation growth fell substantially, ending 2011 at 18.1 percent year on year, a result of tightening monetary policy, put in place during the middle of the year. Additionally, the Vietnam Dong (VND) remained very stable throughout this period, finishing December with an open market rate of VND21,300. However, despite these promising economic conditions, the Vietnam Index fell dramatically to close the year at a multi-year low of 350 points. For all of 2011, the VN Index lost 32.8 percent in USD terms.

 

VNI saw its net asset value decline 8.5 percent to USD183 million (USD0.46 per share) at 31 December 2011, from USD200 million (USD0.50 per share) at 30 June 2011. The loss was due primarily to the performance of listed holdings in the portfolio.

 

During the six months ended 31 December 2011, operational highlights included VNI securing its first tenant at the Ba Thien II Industrial Park, just outside Hanoi, and commenced land-levelling in December. Vietnam's only private condensate refinery, Nam Viet Oil, expanded its customer base from pure wholesale, to industrial and retail customers by building a retail distribution network in the Mekong Delta area. Additionally, Vietnam's largest private independent BTS provider, South East Asia Telecommunications Holdings (SEATH), a fully owned subsidiary of VNI, gained controlling stakes in three portfolio companies and began the consolidation of these assets.

 

For all of 2012, Vietnam's domestic economy will be dominated by the effects of monetary policy aimed at fighting inflation. We have already seen it take shape within a stabilized currency and decelerating rate on CPI during the final half of 2011. In fact, if the government's "crawling peg" policy continues to succeed, the need for future currency devaluation should be minor.

With this expected, improved landscape, we believe Vietnam can achieve GDP growth of 6 percent, lower inflation in the 10 to 12 percent range, and lending rates from the current 20 to 22 percent range to fall to the mid-teen levels. This will ultimately lead to lower borrowing costs and reduce interest expense pressure for companies.

 

For VNI in 2012, we look to continue developing infrastructure dependent land projects, such as industrial parks, as well as, expanding our BTS business through merger and acquisition activity. We will continue to look at pre-listing or listed agribusiness as a way to diversify the scope of our investments. VNI remains well placed to continue acquiring high potential distressed assets at very attractive valuations.

 

At 31 December 2011, VNI's shares traded at USD0.20, representing a 56.5 percent discount to NAV which the Board noted was achieved on very low trading volumes. However, over the last month, the share price for VNI has increased to approximately USD0.26, reducing the discount to 43.5 percent, as trading volumes have improved.  The Board sees this as a positive sign and will continue to monitor the situation.  Further action will be considered if there is not a continual closing of the discount over the next several months.

The Board welcomes shareholder feedback, and we hope to be in touch with many of you over the coming year. Thank you for your continued support.

 

Paul Cheng

Chairman

Vietnam Infrastructure Limited

16 March 2012

 

 

 

 

 

 

 

 

 

 

 

Condensed Interim Consolidated Statement of Financial Position

 

 

 

 

 

 

 

 

 


Condensed Interim Consolidated Statement of Changes in Equity

 

 


 

 

Equity attributable to equity shareholders of the parent

Non-controlling interests

 

Total

equity


 

Share capital

Additional paid-in capital

 

Treasury shares

 

Translation reserve

 

Other reserves

 

Accumulated loss




USD'000

USD'000

USD'000

USD'000

     USD'000

USD'000

USD'000

USD'000










Balance at 1 July 2010

 4,021

346,157

(635)

(378)

60

(92,216)

624

257,633

Loss for the period from 1 July 2010 to 31 December 2010

-

-

-

-

 

-

(26,567)

(99)

 

(26,666)

Other comprehensive income/(loss)









Foreign exchange difference from translations of foreign operations

 

 

-

 

 

-

 

-

 

(831)

 

-

 

-

 

681

 

 

(150)


───────

───────

───────

───────

───────

───────

─────

─────

Total other comprehensive income/(loss)

-

-

-

(831)

-

-

681

 

(150)


───────

───────

───────

──────

──────

──────

──────

──────

Total comprehensive

  income/(loss)

-

───────

-

───────

-

───────

(831)

──────

 -

──────

(26,567)

──────

582

─────────

 

(26,816)

─────

Balance at 31 December 2010

 

4,021

═══════

346,157

═══════

(635)

═══════

(1,209)

══════

60

═════

(118,783)

══════

1,206

═════

230,817

══════

Balance at 1 July 2011

4,021

346,157

(635)

(1,614)

 

47

(148,417)

4,522

 

204,081

Acquisition of subsidiary

-

-

-

-

-

-

3,471

3,471

Adjustments related to non controlling interests

-

-

-

-

-

-

1,674

1,674

Loss for the period from 1 July 2011 to 31 December 2011

-

-

-

-

-

(16,384)

(378)

 

(16,762)

Other comprehensive income









Foreign exchange difference from translations of foreign operations

 

-

-

-

(608)

-

-

346

 

 

(262)


───────

───────

───────

──────

──────

──────

──────

──────

Total other comprehensive income/(loss)

-

-

-

(608)

-

-

346

 

(262)


───────

───────

───────

──────

──────

──────

──────

──────

Total comprehensive loss

-

-

-

(608)

 

-

(16,384)

(32)

 

(17,024)


───────

───────

───────

──────

──────

──────

──────

──────

Balance at 31 December 2011

4,021

346,157

(635)

(2,222)

 

47

(164,801)

9,635

 

192,202


═════

═════

═════

═════

════

═════

═════

═════


Condensed Interim Consolidated Statement of Income

 


Note

Six month period ended



31 December 2011

31 December 2010

 

 


USD'000

USD'000

Revenue


2,917

-

Cost of sales


(608)

-



───────

────────

Gross profit


2,309

-



───────

────────





Net changes in fair value of financial assets at fair value through profit or loss

15

                (11,325)

(23,766)

Loss on fair value adjustment of investment properties


(1,297)

-

Administration expenses

16

(3,033)

(3,758)

Impairment of prepayments for acquisitions of investments


(959)

-



───────

────────

Loss from operating activities


(14,305)

(27,524)



───────

────────





Financial income

17

2,922

2,797

Financial expenses


(1,305)

-

Foreign exchange losses


(558)

(998)

Share of loss from associates, net


(1,406)

(941)



───────

───────



(347)

858



───────

───────

Loss before tax from operations


(14,652)

(26,666)

Income tax expense

18

(2,110)

-



───────

───────

Loss from operations


(16,762)

(26,666)



═══════

═══════





Attributable to equity shareholders of the parent


(16,384)

(26,567)

Attributable to non-controlling interests


(378)

(99)



──────

──────

Loss for the period


(16,762)

(26,666)



══════

══════





Loss per share

- basic and diluted (USD per share)

19(a)(b)

(0.04)

(0.07)



─────

─────









































 

 

 

 

Condensed Interim Consolidated Statement of Comprehensive Income

 



Six month period ended



31 December 2011

31 December 2010

 

 


USD'000

USD'000

Loss for the period


(16,762)

(26,666)





Other comprehensive loss




Foreign exchange differences from translations of    foreign operations


(262)

(150)



───────

───────

Other comprehensive loss for the period


(262)

(150)



───────

───────

Total comprehensive loss for the period


(17,024)

(26,816)



═══════

═══════





Attributable to equity shareholders of the parent


(16,992)

(27,398)

Attributable to non-controlling interests


(32)

582



───────

───────



(17,024)

(26,816)



══════

══════

 


Condensed Interim Consolidated Statement of Cash Flows

 

 


Six month period ended


31 December 2011

31 December 2010


USD'000

USD'000

Operating activities



Net loss before tax

(16,762)

(26,666)

Adjustments for:



Loss on fair value adjustment of financial assets at fair value through profit or loss

10,793

21,225

Net loss from realisation of financial assets at fair value through profit or loss

532

2,791

Loss on fair value adjustments of investment properties

1,297

-

Allowance for impairment of prepayments for acquisitions of investments

959

-

Share of loss from associates, net

1,406

941

Unrealised foreign exchange gain/(loss)

5,452

(2,795)

Interest and dividend income

(2,922)

(2,797)

 

──────

──────

Net profit/(loss) before changes in working capital

755

(7,301)

Change in prepayments

-

2,256

Change in short - term investments

(433)

5,123

Change in trade and other receivables

(2,859)

(2,960)

Change in trade and other payables

3,221

980

 

──────

──────

 Net cash inflow/(outflow) from operating activities

684

(1,902)


──────

──────

Investing activities



Interest received

2,253

2,222

Dividends received

1,279

760

Deposit for acquisition of investment

(3,471)

(882)

Investment in associates

(350)

(399)

Acquisition of financial assets

(3,399)

(13,552)

Acquisition of investment properties

(5,320)

-

Acquisition of subsidiary, net of cash

(4,289)

-

Acquisition of property, plant and equipment

(256)

-

Proceeds from disposals of financial assets

2,842

8,388

 

──────

───────

 Net cash outflow from investing activities

(10,711)

(3,463)


──────

───────

Financing activities



Loan proceeds from banks

746

-

Loan repayments to banks

(1,000)

-


──────

───────

Net cash outflow from financing activities

(254)

-


──────

──────

Net decrease in cash and cash equivalents

  for the period

(10,281)

(5,365)

Foreign currency translation differences

(36)

(113)

Cash and cash equivalents at the beginning of the period

67,391

79,938


──────

─────

Cash and cash equivalents at end of the period

57,074

74,460


═══════

══════


Notes to the Condensed Interim Consolidated Financial Statements

 

1.  GENERAL INFORMATION

 

Vietnam Infrastructure 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 Company's principal activity is to invest in a diversified portfolio of entities owning infrastructure projects and assets in Vietnam and the surrounding Asian countries. The Company mainly invests and holds equity, debt instruments in unquoted companies that themselves hold, develop or operate infrastructure assets. The Company may also invest in entities whose shares or other instruments are listed on a stock exchange, or traded on the OTC markets. The Company also may invest in other funds that invest in infrastructure. The Company is listed on the AIM Market of the London Stock Exchange under the ticker symbol VNI.

 

The condensed interim consolidated financial statements for the six months ended 31 December 2011 were approved for issue by the Company's Board of Directors on 14 March 2012.

 

2.  BASIS OF PREPARATION

 

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

 

These condensed interim consolidated financial statements are for the six months period ended 31 December 2011. 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 financial statements which are prepared in accordance with International Financial Reporting Standards ("IFRS"). 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 2011.

 

3.  ACCOUNTING POLICIES

 

These condensed interim 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 financial statements for the year ended 30 June 2011.

 

The AIM Rules for Companies require comparative figures for the balance sheet for the corresponding period end in the preceding financial year which differs to IAS 34 which requires comparative figures for the balance sheet for the immediately preceding financial year end.  The Group continues to elect to report in accordance with IAS 34 and as such has agreed with the London Stock Exchange a derogation from the above requirement of the AIM Rules for Companies in order to comply with IAS 34.

 

4.  ESTIMATES

 

When preparing the condensed interim consolidated financial statements, the Group 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.

 

Information about significant judgements, estimates and assumptions that have the most effect on recognition and measurement of assets, liabilities, income and expenses were the same as those that applied to the last annual financial statements for the year ended 30 June 2011.

 

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 energy, property and infrastructure developers, telecommunications, transportation and logistics, general infrastructure, environment and others.

 

Each of the operating segments are managed and monitored separately by the Investment Manager as each requires different resources and approaches. The Investment Manager assesses segment profit or loss using a measure of operating profit or loss from the investment assets. Although IFRS 8 requires measurement of segmental profit or loss, the majority of expenses are common to all segments therefore cannot be individually allocated. There have been no changes from prior periods in the measurement methods used to determine reported segment profit or loss.

 

 

5.  SEGMENT ANALYSIS (CONTINUED)

 


 

As at 31 December 2011


 

 

Energy

Property and infrastructure developers

 

Telecom-munications

 

Transportation and logistics

 

General

infrastructure

 

 

Environment

 

 

Others

Cash and others

 

 

Total


USD'000

USD'000

USD'000

USD'000

USD'000

USD'000

USD'000

USD'000

USD'000





















Vietnam










Financial assets at fair value through profit or loss










-    Held for trading

16,480

2,900

978

7,854

4,176

-

7,475

-

39,863

-    Designated at fair  value through profit or loss

10,566

-

-

11,665

-

-

-

-

22,231

Investment properties

-

22,237

30,207

-

-

-

-

-

52,444

Prepayment for acquisitions of investments

-

9,490

-

-

-

-

-

-

9,490

Investment in associates

2,979

-

6,163

-

-

2,476

-

-

11,618

Other assets

-

-

1,151

-

-

-

-

10,806

11,957

Cash and cash equivalents

-

-

-

-

-

-

-

51,857

51,857











Outside Vietnam










Cash and cash equivalents

-

-

-

-

-

-

-

5,217

5,217


─────

─────

─────

─────

─────

─────

─────

────

────

Total assets

30,025

34,627

38,499

19,519

4,176

2,476

7,475

67,880

204,677


─────

─────

─────

─────

─────

─────

─────

────

────

Segment information can be analysed as follows for the reporting periods under review:

 






                        






As at 30 June 2011





 

 

 

Energy

 

Property and infrastructure developers

 

 

Telecom-munications

 

Transportation and logistics

 

 

General

 infrastructure

 

 

 

Environment

 

 

 

Others

 

 

Cash and others

 

 

 

Total


USD'000

USD'000

USD'000

USD'000

USD'000

USD'000

USD'000

USD'000

USD'000











Vietnam










Financial assets at fair value through profit or loss










Held for trading

30,900

5,660

1,245

9,514

5,120

-

5,662

-

58,101

Designated at fair  value through profit or loss

  1,393

  -

-

13,243

 -

 -

193

-

14,829

Investment properties

  -

20,883

12,543

-

 -

 -

  -

 -

33,426

Prepayment for acquisitions

  of investments

  -

10,267

146

-

 -

 -

  -

 -

10,413

Investment in associates

3,049

  -

16,637

-

 -

4,200

  -

 -

23,886

Other assets

  -

901

2,979

-

 -

 -

  -

1,532

5,412

Cash and cash equivalents

-

-

-

-

-

-

-

62,832

62,832











Outside Vietnam










Cash and cash equivalents

  -

  -

-

-

 -

 -

  -

4,559

4,559


─────

─────

─────

─────

─────

─────

─────

─────

─────

Total assets

35,342

37,711

33,550

22,757

5,120

4,200

5,855

68,923

213,458


─────

─────

─────

─────

─────

─────

─────

─────

─────

  























Six month period ended 31 December 2011



 

 

 Energy

 

Property and infrastructure developers

 

 Telecom-munications

 

Transporta-tion and logistics

 

 General

infrastructure

 

 

 Environment

 

 

 Others

 

 

 Total


 USD'000

 USD'000

 USD'000

 USD'000

 USD'000

 USD'000

 USD'000

 USD'000

 Vietnam









 Net changes in fair value of financial assets at fair value through profit or loss









-   Held for trading 

(3,139)

(1,159)

(267)

(1,667)

(1,117)

 - 

(1,154)

(8,503)

-   Designated at fair  value through profit or loss

(1,050)

-

-

(1,578)

-

 - 

(194)

(2,822)

Foreign exchange losses

(30)

(36)

(244)

-

-

 - 

-

(310)

Financial income - Dividend income

682

114

141

303

170

 - 

140

1,550

Loss on fair value adjustment of investment properties

-

(1,297)

-

-

-

-

-

(1,297)

Share of profit/(loss) of associates, net

-

-

667

-

-

(2,073)

-

(1,406)

Revenue

-

-

2,917

-

-

-

-

2,917

Cost of sales

-

-

(608)

-

-

-

-

(608)

Income tax expense

-

(2,110)

-

-

-

-

-

(2,110)

Other expenses

-

(959)

-

-

-

-

-

(959)

Financial expenses

-

-

(1,305)

-

-

-

-

(1,305)


─────

─────

─────

─────

─────

─────

─────

─────

Total 

(3,537)

(5,447)

1,301

(2,942)

(947)

(2,073) 

(1,208)

(14,853)


─────

─────

─────

─────

─────

─────

─────

─────

Unallocated









 Administration expenses








(3,033)

    Financial income - Interest income








1,372

Foreign exchange losses 








(248)









─────

Net loss for the period








(16,762)









═════

 




Six month period ended 31 December 2010




 

 

Energy

Property and infrastructure developers

 

Telecom-munications

Transporta

-tion and logistics

 

General

infrastructure

 

 

Environment

 

 

Others

 

 

Total


USD'000

USD'000

USD'000

USD'000

USD'000

USD'000

USD'000

USD'000

Vietnam









Net changes in fair value of financial assets at fair value through profit or loss









 -Held for trading

 (5,151)

  (5,915)

  (1,223)

  (1,930)

  (5,563)

 - 

(68)

(19,850)

 -Designated at fair value through profit or loss

  (64)

 -

 -

  (3,845)

 -

  -

(7)

(3,916)

Foreign exchange losses

 (16)

  (221)

 -

 (13)

 -

 -

 -

(250)

Financial income - Dividend income

 707

 185

82

42

 514

 - 

 -

 1,530

Share of profit/(loss) of associates, net

-

 -

459

 -

 -

(1,400)

 -

(941)


─────

─────

─────

─────

─────

─────

─────

─────

 Total

  (4,524)

  (5,951)

  (682)

  (5,746)

  (5,049)

(1,400)

(75)

 (23,427)


─────

─────

─────

─────

─────

─────

─────

─────

Unallocated









Administration expenses








(3,758)

Financial income - Interest income








1,267

Foreign exchange losses








(748)









─────

Net loss for the period








(26,666)









═════

 

 

 

 

 

 

6.  ACQUISITION OF A SUBSIDIARY

 

Acquisition of controlling interest in VNC- 55 Infrastructure Investment Joint Stock Company ("VNC - 55")

 

At 30 June 2011, the Group held a 40% equity interest in VNC-55 which was previously an associate. The principal activity of this company is to build and lease out base transceiver station towers to local mobile telephone operators. On 24 December 2011, the Group acquired a further 20% equity interest for USD4.3 million. The additional stake brought the Group's total interest in the entity to 60% at the reporting date.

 

The acquisition date fair value of the equity interest in VNC-55 held by the Group immediately before the acquisition date was USD9.8 million. There was no gain or loss as a result of re-measuring to fair value of the equity interest in the 40% held by the Group before the date of additional acquisition because its re-measured fair value was equal to its carrying value as at the date immediately before the additional investment. There is no goodwill recognised on the consolidated financial statements because the consideration paid and acquisition-date fair value of the Group's previously held equity interest in VNC-55 is equal to the fair value of the Group's share of the identifiable net assets of VNC-55 at the date of acquisition.

 

7.  INVESTMENT PROPERTIES

 

31 December 2011

30 June 2011

USD'000

USD'000



33,426

3,538

4,289

10,019

-

7,426

16,285

4,784

(1,297)

8,331

(259)

(672)

─────

52,444

═════

─────

33,426

═════

 

(*) Included in the additions of USD16.285 million is USD11.5 million in respect of the acquisition of a controlling interest in VNC-55 in December 2011.

 

8.  PREPAYMENT FOR ACQUISITIONS OF INVESTMENTS

 

31 December 2011

30 June 2011

USD'000

USD'000



8,520

8,520

1,531

1,531

398

362

────

10,449

────

10,413

(959)

-

────

9,490

════

─────

10,413

═════

 

9.  INVESTMENT IN ASSOCIATES

 

31 December 2011

30 June 2011

USD'000

USD'000



25,286

30,624

 350

1,418

(9,776)

(6,548)

(837)

638

(245)

(846)

(3,160)

(1,400)

─────

11,618

═════

─────

23,886

═════

 

(*) As at 31 December 2011 and 30 June 2011, an allowance of USD1.40 million has been made against the investment in Vietstar Joint Stock Company following its breach of loan covenants. The project is in default, but the banks have given management an opportunity to implement a turnaround plan.

 

An additional allowance of USD1.76 million as at 31 December 2011 has been made against the investment in the Mobile Infrastructure Development Co., Ltd. pending the negotiation of settlement of legal action against the local shareholder.

 

10.  TRADE AND OTHER RECEIVABLES


31 December 2011

30 June 2011


USD'000

USD'000




Interest receivable (*)

11,102

10,875

Dividends receivable

271

2,813

Deposit for acquisition of investment (**)

3,471

-

Trade and other receivables (***)

5,430

-


────

────


20,274

13,688

Allowance for impairment of receivables

(9,965)

(9,965)

Closing balance

 

────

10,309

════

────

3,723

════

 

As trade and other receivables are short-term in nature, their carrying values are considered a reasonable approximation of their fair values at the reporting date.

 

(*) Included in interest receivables is an amount of USD9.96 million representing receivables of interest from Thai Thinh Corporation which was fully provided for as at 30 June 2011.

 

(**) The deposit of USD3.47 million relates to a partial prepayment of the total amount required to acquire the remaining interest in VNC-55 of USD8.6 million (Note 23)

 

(***) Included in trade and other receivables of USD5.43 million is USD2.48 million arising from the new subsidiary, VNC-55, acquired during the period.

 

11.  FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS

 

31 December 2011

30 June 2011

 

USD'000

USD'000

Financial assets held for trading

 

 

Financial assets at fair value through profit or loss:

Ordinary shares - listed

36,714

44,574

Ordinary shares - unlisted based on fair values using quoted market prices

10,569

10,225

Corporate bonds                                                

3,149

3,302

Financial assets designated at fair value through profit or loss:

 

 

Ordinary shares - unlisted based on fair values using valuation techniques

11,662

14,829

 

Closing balance

─────

62,094

═════

─────

72,930

═════

 

12.  CASH AND CASH EQUIVALENTS


31 December 2011

30 June 2011


USD'000

 USD'000


 

 

Cash at banks

8,461

17,970

Cash equivalents

48,613

49,421

Closing balance

 

──────

57,074

══════

─────

67,391

═════

 

13.  BORROWINGS


31 December 2011

30 June 2011


USD'000

USD'000

Non-current



Bank borrowings (*)

130

1,130

           Less: Current portion of long-term borrowings

(130)

(821)


─────

────


-

309

Current



Bank borrowings (*)

885

184

Current portion of long-term borrowings

130

821

Others

570

525


─────

────


1,585

1,530


─────

────

 Total borrowings

1,585

1,839


═════

════

(*) Details of the borrowings at the reporting date are as follows:

Lender

Amount

USD'000

Loan

period

(months)

 Repayment terms

Annual interest rate (%)

 






 

 

BIDV - Thang Long branch

130

54

Quarterly instalment, full repayment in 2012

19

 

Lien Viet bank

247

12

Full repayment by 31 December 2012

20

 

Techcombank

- Tan Binh branch

638

24

Fully repaid by 30 May 2012

19

 

Others

570

12

Due by 30 June 2012

19.8

 


────





1,585

 


════

 

 

14.  PAYABLES TO RELATED PARTIES


31 December 2011

30 June 2011


 USD'000

USD'000




Payable to VinaCapital Investment Management Ltd:

-  management fee

320

2,154

-  other payables

45

44

Payables to other related parties

73

65

Payables to shareholders

6

6


────

────

Closing balance

 

444

════

2,269

════

 

As payables to related parties are short-term in nature, their carrying values are considered a reasonable approximation of their fair values at the reporting date.

 

15.  NET CHANGES IN FAIR VALUE OF FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS

 

Six month period ended

 

31 December

2011

31 December

2010

 

USD'000

USD'000

 

 

 

Unrealised losses based on fair values using :

-   market price

(9,101)

(15,295)

-   valuation techniques

-

(3,396)

Losses from realisation of financial assets

(532)

(2,541)

Unrealised losses on foreign exchange translation

(1,692)

(2,534)

 

Closing balance

─────

(11,325)

═════

─────

(23,766)

═════

 

16.  ADMINISTRATION EXPENSES

 

Six month period ended

 

31 December

2011

31 December

2010

 

USD'000

USD'000

 

 

 

Management fees (*)

1,995

2,414

Professional fees

268

559

Custodian fees

99

150

Directors' fees

73

65

General administration expenses

598

215

Other expenses

-

355

 

────

3,033

════

────

3,758

════

 

(*) Total management fees for the period amounted to USD1,944,574 (31 December 2010: USD 413,963), with USD319,657 (31 December 2010: USD808,599) in outstanding accrued fees due to the investment manager, VinaCapital Investment Management Limited, as at the reporting date.

 

The investment manager receives a management fee based on the gross asset value of the Group, payable monthly in arrears, at an annual rate of 2%. It is also entitled to a performance fee equal to 20% of the realised returns over an annualised compounding hurdle rate of 8%. There was no performance fee payable for the six month period ended 31 December 2011 and 31 December 2010.

 

17.  FINANCIAL INCOME

 

Six month period ended

 

31 December

2011

31 December

2010

 

USD'000

USD'000

 

 

 

Interest income

1,372

1,267

Dividend income

1,550

1,530

 

─────

2,922

═════

─────

2,797

═════

 

18.  INCOME TAX EXPENSE AND DEFERRED TAX LIABILITY

 

Income tax expense

 

Six month period ended

 

31 December

2011

31 December 2010

 

USD'000

USD'000

 

 

 

Group loss before tax

(14,652)

(26,666)

 

──────

─────

Group loss multiplied by applicable tax rate (0%)

-

-

Current income tax expenses on Vietnamese subsidiaries

(27)

-

Deferred income tax expense

(2,083)

-

 

──────

─────

Closing balance

(2,110)

-

 

══════

═════

 

Deferred tax liabilities

 

As at 31 December 2011, the deferred tax liability of USD2.083 million arose from revaluation gains recognised by the Group on investment properties.

 

19.  EARNINGS PER SHARE

 

(a) Basic

 

Basic earnings per share is calculated by dividing the loss attributable to shareholders of the Group by the weighted average number of ordinary shares on issue during the period.

 


Six month period ended


31 December 2011

31 December 2010

Loss attributable to equity holders of the Group (USD'000)

(16,384)

(26,567)

Weighted average number of ordinary shares on issue

401,169,300

401,169,300

Basic loss per share (USD per share)

(0.04)

───────

(0.07)

────────

 

 (b) Diluted

 

Diluted loss 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 potentially dilutive ordinary shares. Therefore, diluted loss per share is equal to basic loss per share.

 

(c) Net asset value per share

 

Net asset value (NAV) per share is calculated by dividing the net asset value attributable to ordinary shareholders of the Company by the number of outstanding ordinary shares as at the reporting date.  Net asset value is determined as total assets less total liabilities and non-controlling interest.

 

 

Six month period ended

 

31 December 2011

31 December 2010

Net asset value (USD'000)

182,567

199,559

Number of outstanding ordinary shares on issue

401,169,300

401,169,300

Net asset value per share (USD per share)

0.46

0.50

 

───────

───────

 

20.  FAIR VALUE HIERARCHY

 

The following table presents financial assets measured at fair value by valuation method. The different levels have been defined as below:

 

-   Level 1: quoted prices (unadjusted) in active markets for identical assets;

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

-   Level 3: inputs for the assets that are not based on observable market data (unobservable inputs).

 

There are no financial liabilities of the Group which were measured using the fair valuation method as at 31 December 2011 and 30 June 2011.

 

The level within which the financial asset is classified is determined based on the lowest level of significant input to the fair value measurement.

 

The financial assets measured at fair value in the statement of financial position are grouped into the fair value hierarchy as follows:

 


Level 1

Level 2

Level 3

Total


USD'000

USD'000

USD'000

USD'000

30 June 2011





Financial assets in Vietnam





  Ordinary share - listed

44,574

-

-

44,574

  Ordinary share - unlisted

-

10,225

14,829

25,054

  Corporate bonds

-

-

3,302

3,302


─────

44,574

═════

─────

10,225

═════

─────

18,131

═════

─────

72,930

═════

 

31 December 2011





Financial assets in Vietnam





  Ordinary share - listed

36,714

-

-

36,714

  Ordinary share - unlisted

-

10,569

11,662

22,231

  Corporate bonds

-

-

3,149

3,149


─────

36,714

═════

─────

10,569

═════

─────

14,811

═════

─────

62,094

═════

 

During the period ended 31 December 2011, there were no reclassifications of financial assets and no transfers between levels of fair value hierarchy used in measuring the fair value of financial assets.

 

21.  FINANCIAL RISK MANAGEMENT

 

The Group's activities expose it to a variety of financial risks: market risk (including currency risk, fair value interest rate risk, cash flow interest rate risk and price risk), credit risk and liquidity risk.

 

The interim condensed consolidated financial statements do not include all financial risk management information and disclosure required in the annual financial statements, and should be read in conjunction with the Group's annual financial statements as at 30 June 2011.

 

There have been no changes in the risk management department since year end and or in any risk management policies.

 

22.  SEASONALITY

 

The Group's management believes that the impact of seasonality on the interim financial information is not material.

 

23.  SUBSEQUENT EVENT

 

Subsequent to the period end, the Group acquired an additional stake in VNC - 55 for USD8.72 million. This brings its total interest in this entity to 100%.

 

24.  COMMITMENTS

 

As at 31 December 2011, the Group was committed under non-cancellable lease agreements for the following amounts:

 


31 December 2011


USD'000



Within the next year

1,388

Within two to five years

5,195

Over five years

3,522

Total

 

 

────────

10,105

════════

 

 

 

 

 

 

 

 

 

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
END
 
 
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