Final Results
Not for Distribution, directly or indirectly, in or into the United States or any jurisdiction in which such distribution would be unlawful.
12 March 2020
Symphony International Holdings Limited
Financial Results for the year ended 31 December 2019
Symphony International Holdings Limited ("Symphony" or the "Company") announces results for the year ended 31 December 2019 . The condensed financial statements of the Company has not been audited or reviewed by the auditors of the Company.
Introduction
The Company is an investment company initially incorporated as a limited liability company under the laws of the British Virgin Islands on 5 January 2004. The Company voluntarily re-registered itself as a BVI Business Company on 17 November 2006. The Company's investment objectives are to increase the aggregate net asset value of the Company ("NAV") calculated in accordance with the Company's policies through strategic longer-term investments in consumer-related businesses, primarily in the healthcare, hospitality, lifestyle (including branded real estate developments), logistics and education sectors predominantly in Asia and through investments in special situations and structured transactions, which have the potential to generate attractive returns and to enhance the NAV.
The Company was admitted to the Official List of the UK Listing Authority on 3 August 2007 under Chapter 14 of the UK Listing Rules and its securities were admitted to trading on the London Stock Exchange's main market for listed securities on the same date.
As at 31 December 2019 , the issued share capital of the Company was US$409.70 million (31 December 2018 : US$409.70 million) consisting of 513,366,198 (31 December 2018 : 513,366,198) ordinary shares.
Symphony's Investment Manager is Symphony Asia Holdings Pte. Ltd. ("SAHPL" or the "Investment Manager"). The Company has an Investment Management Agreement with SAHPL as the Investment Manager.
Net Asset Value
Symphony's NAV is the sum of its cash and cash equivalents, temporary investments, the fair value of unrealised investments (including investments in subsidiaries, associates and joint ventures) and any other assets, less any other liabilities. The unaudited financial statements contained herein may not account for the fair value of certain unrealised investments. Accordingly, Symphony's NAV may not be comparable to the net asset value in the unaudited financial statements. The primary measure of SIHL's financial performance and the performance of its subsidiaries will be the change in Symphony's NAV per share resulting from changes in the fair value of investments.
The NAV attributable to the ordinary shares on 31 December 2019 was US$ 0.9805 per share. This represents a 2.2% increase over the NAV per share of US$ 0.9598 at 31 December 2018.
Chairmen's Statement
2019 turned out to be a busy year for us in terms of new investments. We saw several attractive opportunities and made six new investments, as described below.
This time last year, we were beginning to see the effects of less accommodative monetary policy and weaker investor sentiment that had impacted market valuations. The expected continued unwinding of the unprecedented monetary easing that has lasted more than a decade surprisingly did not happen. Instead, we saw central banks across the world cut interest rates aggressively in 2019 to counter weaker growth and escalating trade tensions. Financial markets have been buoyed as a result.
Despite the current historically low interest rates, further cuts and other stimulus are likely on the horizon due to a sluggish recovery and, more recently, the growing impact of the coronavirus, Covid-19. With the current level of global supply chain integration and interdependencies, the full impact of the Covid-19 is almost impossible to determine across industries, as something like this has no precedent. We expect some of our investments, particularly those with exposure to hospitality, food and beverage and trade, to be significantly affected in the short to medium term.
We also see certain other risks to the global economy, including but not limited to further US-China decoupling despite the recent trade accords, the ongoing negotiations of the UK-EU trading relationship, the potential escalation of tensions in the Middle East and the emergence of inflationary pressures that could hinder accommodative policies. Although these risks may impact financial markets, we believe, nevertheless, that the continued long-term strengthening of Asian economies and related integration will continue to provide relatively more longer-term investment opportunities and better risk adjusted returns than other regions.
Despite the uncertain global outlook and market volatility during 2019, we are pleased to report that Symphony's key measure of performance, Net Asset Value ("NAV") and NAV per share, improved. NAV and NAV per share increased by 2.2% to US$503.37 million and US$0.98 per share at 31 December 2019 from US$492.71 million and US$0.96 per share a year earlier, respectively. Symphony paid a dividend of US$17.97 million or 3.5 cents per share during 2019, which brings cumulative dividend paid since 2014 to 43.85 cents or approximately US$266.69 million. Excluding dividends during 2019, NAV and NAV per share would have increased by 5.8%. The growth in NAV during 2019 was predominantly due to an increase in value of Minor International Pcl ("MINT") and an interest in a property joint venture in Japan, which were partially offset by a cumulative net decline in the value of other investments.
During 2019, through proprietary relationships, we expanded and diversified our portfolio with the addition of six new investments. Together with follow-on investments, Symphony deployed US$90.67 million during the year.
Symphony's new investments include interests in two established businesses; Indo Trans Logistics Corporation ("ITL"), the largest independent integrated logistics company in Vietnam and ASG Hospital Private Limited ("ASG"), a full-service eye-healthcare provider with 33 clinics predominantly in India. The remaining four investments include interests in more early stage businesses; Smarten Spaces Pte. Ltd. ("Smarten"), a software-as-a-service ("SaaS") company providing solutions for space management in commercial and industrial properties, Soothe Healthcare Private Limited ("Soothe"), a manufacturer and distributor operating in the fast growing feminine hygiene market segment in India under the Pariz and Paree brands, Good Capital Partners and Good Capital Fund I (collectively "Good Capital"), the general partner and its related technology start-up fund and Creative Technology Solutions DMCC ("CTS"), a company that provides technology solutions to K12 schools and universities in the UAE and the Kingdom of Saudi Arabia. With these additional investments, Symphony offers its shareholders a strong diversified portfolio of attractive businesses with exposure to fast growing markets.
In addition to new investments, we also made some partial and full exits. During the first quarter of 2019, Symphony sold part of its interest in the Liaigre Group to facilitate a new strategic investor. The sale of shares was completed at a premium to our cost of the investment. We also generated liquidity through the sale of MINT shares during the 2019 financial year that provided net proceeds of US$19.31 million and was completed at 5.4 times the original cost of investment and a net annualised return of 16.7% over a period of approximately 14-years. In December 2019, we announced an agreement for the partial sale of land in Hirafu Village, Niseko, Hokkaido, Japan through a joint venture in which Symphony holds a 37.5% interest. As a result and based on a third party valuation, the fair value of Symphony's interest in the joint venture increased at 31 December 2019, which implies an annualised return of 27.2% and 3.7 times the original cost of the investment. In January 2020, we announced our full exit from our investment in IHH Healthcare Berhad ("IHH"). We originally made the investment in IHH in 2012 and exited our interest through a series of partial sales that began in 2015. Our investment in IHH generated an annualised return of 11.2% over a period of eight years and 1.8 times the original cost of investment. Although our investment horizon is longer than typical private equity style investments, the continuous ability to generate attractive risk adjusted returns as investments mature reaffirms Symphony's investment thesis and strategy.
During FY2019, we made a decision to reclassify our reporting segments to better reflect the composition of our portfolio. In the hospitality segment, our primary investment is MINT, which continued to grow its business following the acquisition of the NH Hotel Group SA ("NH Group") in 2018. The number of hotel and restaurants in MINT's portfolio that are owned and managed grew to 535 and 2,377 at 31 December 2019 from 513 and 2,270 a year earlier, respectively. Most notably during the year, MINT initiated an asset rotation program that involved the sale and lease back of three properties in Portugal, which were part of the 14-property Tivoli portfolio acquired in 2016, that generated gross sale proceeds of €313 million. Aside from strengthening MINT's balance sheet, the proceeds from the sale approximately amount to the capital deployed by MINT in 2016 to acquire all 14 Tivoli properties. MINT has stated it will continue to explore asset enhancement and rotation initiatives, which will unlock further value.
The lifestyle and real estate segment grew as a percentage of Symphony's NAV to 33.0% at 31 December 2019 from 27.4% a year earlier. The relative increase in this segment as a percentage of NAV is predominantly due to the revaluation of Symphony's interest in the joint venture in Niseko following an agreement for the partial sale of land. The transaction for the sale is scheduled to close in April 2020. In addition to the sale of land, the joint venture in Niseko will, through a separate participation structure, co-develop another part of the land with Hanwha Hotels and Resorts, which will allow us to unlock further value in the years to come.
Our other investments in the lifestyle and real estate segment benefited from strengthening local currencies, particularly in Thailand. Symphony's two investments in Bangkok, Thailand include Minuet Limited ("Minuet"), which owns approximately 40 hectares of land for sale and / or development, and SG Land Limited, which owns the lease rights for two centrally located commercial buildings. Both investments benefited from an appreciation of the Thai baht against the US dollar, Symphony's reporting currency, by 8.1% during 2019. In Malaysia, Symphony made follow-on investments in the joint venture developing the One & Only branded hotel and private villa development in Desaru, Malaysia. The hotel is scheduled to open in late March 2020 and Villa sales will commence shortly thereafter.
Our new logistics investment, ITL, is focused on long-term growth through organic and inorganic expansion in order to diversify its business mix and increase scale. US-China trade tensions have however created headwinds for ITL due to considerable aviation capacity moving from China to Vietnam. Although ITL is gaining market share, the business is seeing some pressure on yields. While we expect some further disruption to volumes due to Covid-19, the long-term prospects for this sector in Vietnam remain extremely attractive.
The composition of the lifestyle segment includes our investments in the Liaigre Group, Chanintr Living ("Chanintr") and the Wine Connection Group ("WCG"). The performance in this segment has been mixed over the course of 2019. The Liaigre Group, a luxury furniture brand that is synonymous with discreet luxury, has been impacted by ongoing underperformance of showrooms in Europe. However, we continue to see strength in the interior architecture business and demand from Asia. In November 2019, Liaigre opened a well-received flagship showroom in Shanghai, China, which will help improve brand exposure in the region. Chanintr, a business that predominantly distributes high-end US and European furniture through retail showrooms and interior design projects for residential and hotel developments, continues to benefit from growing demand in Thailand. In addition to working closely with developers on providing turnkey solutions for end-buyers, Chanintr is also seeing growth from the office market segment as corporate clients upgrade their workplaces.
WCG operates 82 wine shops and wine themed restaurants in Thailand, Singapore, Malaysia and South Korea. We continue to see weakness in the casual dining restaurant space in WCG's core markets, which include Thailand and Singapore. We mentioned in our past shareholder updates that the founder of WCG returned as group CEO in Q3 2019 to reinvigorate operations through a number of new initiatives. We are seeing some positive signs, but we expect the impact of Covid-19 to dampen any immediate recovery.
The healthcare segment includes our investments in IHH, ASG and Soothe. As mentioned earlier, we exited the remaining shares held in IHH in January 2020, which generated attractive risk-adjusted returns. We are working with our co-investors in the ASG investment, completed in November 2019, to assist management with realising administrative and operational efficiencies as well as exploring brownfield expansion opportunities. These initiatives will gradually add value and support additional scale for the business. The investment in Soothe was fully completed in August and has been growing sales rapidly through targeted marketing campaigns and expanded distribution.
WCIB International Co. Ltd ("WCIB"), which operates Wellington College International Bangkok and CTS comprise the education segment. WCIB is currently in its second year of operations and we are pleased that it has achieved its target student intake. We expect the school to continue to ramp-up operations in tandem with the construction of facilities for higher academic years. The investment in CTS was completed in June 2019 and its business is to provide technology solutions to K-12 schools and more recently, through an expanded product offering, universities.
We have grouped our special situations and other investments in a separate category for reporting purposes. Aside from a structured loan that generates an attractive yield, this segment includes two new investments; Smarten and Good Capital. Symphony rarely invests in early stage businesses unless there is strong conviction among the investment management team to do so. Smarten is one of those businesses. Smarten continues to attract large corporate clients that typically choose to extend roll-out of its SaaS offering across organisations. We continue to support management to help scale its client base. Similarly, we have a strong conviction regarding the investment in Good Capital, which was made to gain a small exposure to the burgeoning technology sector in India. The promotors of Good Capital have developed an extensive network in the technology start-up ecosystem in India and have a strong track record for generating attractive returns. Our special situations investments broaden our portfolio to include exposure to more innovative companies emerging in Asia.
Despite the extraordinary market environment, we feel our portfolio is well positioned for long-term growth, offering our shareholders broad exposure to attractive markets, particularly in Asia. We continue to explore new opportunities that can further enhance Symphony's portfolio and provide incremental returns in the years ahead. We would like to thank our shareholders and business partners for their continued support.
Georges Gagnebin
Chairman, Symphony International Holdings Limited
Anil Thadani
Chairman, Symphony Asia Holdings Pte. Ltd.
11 March 2020
Investment Manager's Report
This "Investment Manager's Report" should be read in conjunction with the financial statements and related notes of the Company. The financial statements of the Company were prepared in accordance with the International Financial Reporting Standards ("IFRS") and are presented in U.S. dollars. The Company reports on each financial year that ends on 31 December. In addition to the Company's annual reporting, NAV and NAV per share are reported on a quarterly basis being the periods ended 31 March, 30 June, 30 September and 31 December. The Company's NAV reported quarterly is based on the sum of cash and cash equivalents, temporary investments, the fair value of unrealised investments (including investments in unconsolidated subsidiaries, associates and joint ventures) and any other assets, less any other liabilities. The financial results presented herein include activity for the period from 1 January 2019 through 31 December 2019, referred to as "the year ended 31 December 2019".
Our Business
Symphony is an investment company incorporated under the laws of the British Virgin Islands. The Company's shares were listed on the London Stock Exchange on 3 August 2007. Symphony's investment objective is to create value for shareholders through longer term strategic investments in high growth innovative consumer businesses, primarily in the healthcare, hospitality and lifestyle sectors (including education and branded real estate developments), which are expected to be fast growing sectors in Asia, as well as through investments in special situations and structured transactions.
Symphony's Investment Manager is Symphony Asia Holdings Pte. Ltd. ("SAHPL"). The Company entered into an Investment Management Agreement with SAHPL as the Investment Manager. Symphony Capital Partners Limited ("SCPL") is a service provider to the Investment Manager.
SAHPL's licence for carrying on fund management in Singapore is restricted to serving only accredited investors and/or institutional investors. Symphony is an accredited investor.
Investments
At 31 December 2019, the total amount invested by Symphony since admission to the Official List of the London Stock Exchange in August 2007 was US$544.17 million (2018: US$453.50 million). SIHL's total cost of investments after taking into account shareholder loan repayments, redemptions, partial realisations and the cost of fully realised investments was US$161.61 million at 31 December 2019, up from US$118.55 million a year earlier. The change is due to (i) the partial realisation of MINT shares that generated net proceeds for US$19.31 million, which increased cumulative proceeds in excess of total cost for this investment to US$83.86 million at 31 December 2019, (ii) the partial realisation of IHH shares that generated net proceeds of US$6.65 million, which brought cumulative proceeds to US$31.87 million in excess of total cost at 31 December 2019, (iii) partial realisations, redemptions and shareholder principal loan repayments related to unlisted investment of US$21.75 million and (iv) new investments of US$90.67 million and other minor movements of US$0.10 million that increased cost.
As at 31 December 2019, the healthcare, hospitality, lifestyle, lifestyle/real estate, logistics, education and other sector investments accounted for -5.5%, -51.9%, 53.2%, 56.7%, 26.4%, 11.6% and 9.4% (2018 restated on the same basis: -21.1%, -54.4%, 82.7%, 67.6%, 0.0%, 13.1% and 12.1%) of total cost of investments, respectively. The negative net cost in the healthcare and hospitality sectors is due to partial realisations related to certain investments that have generated proceeds in excess of cost for that sector.
The fair value of investments, excluding temporary investments (but including other investments), held by Symphony was approximately US$588.70 million at 31 December 2019 up from US$502.69 million a year earlier. This change is comprised of an increase in the value of investments by US$43.05 million, new investments of US$90.67 million and realisations (including redemptions and shareholder loan principal repayments) of US$47.72 million.
As at 31 December 2019, we had the following investments:
Minor International Public Company Limited
Minor International Public Company Limited ("MINT") is a diversified consumer business and is one of the largest hospitality and restaurant companies in the Asia-Pacific region. Anil Thadani (a Director of the Company) currently serves on MINT's board of directors. Sunil Chandiramani (a Director of the Company) currently serves as an advisor to MINT's board of directors. MINT is a company that is incorporated under the laws of Thailand and is listed on the Stock Exchange of Thailand.
MINT owns 379 hotels and manages 156 other hotels and serviced suites with 78,360 rooms. MINT owns and manages hotels in 57 countries predominantly under its own brand names that include Anantara, Oaks, NH Collection, NH Hotels, nhow, Elewana, AVANI, Per AQUUM and Tivoli.
As at 31 December 2019, MINT also owned and operated 2,377 restaurants (comprising 1,198 equity-owned outlets and 1,179 franchised outlets) under the brands The Pizza Company, Swensen's, Sizzler, Dairy Queen, Burger King, Beijing Riverside, Thai Express, Bonchon, Benihana and The Coffee Club amongst others. Approximately two-thirds of these outlets are in Thailand with the remaining number in other Asian countries, the Middle East and the United Kingdom. MINT's operations also include contract manufacturing and an international lifestyle consumer brand distribution business in Thailand focusing on fashion, cosmetics through retail (485 outlets), wholesale and direct marketing channels under brands that include Anello, Bossini, Brooks Brothers, Esprit, Charles & Keith, Zwilling J.A. Henckels and Bodum amongst others.
MINT reported core revenue, earnings before interest, tax, depreciation and amortisation ("EBITDA") and net profit growth (before non-recurring items) of 57%, 42% and 23% in 2019 year-over-year, respectively. The growth in revenue was predominantly driven by the full year consolidation of the NH Hotel Group S.A. ("NH Group") and improved revenue from all business groups. The slower growth in EBITDA is a result of structurally lower profitability margins from the consolidated NH Group and margin pressure on the restaurant and lifestyle businesses due to weaker domestic consumption.
MINT's hotel and mixed-use business had core revenues (excluding non-recurring items) of THB94.2 billion during 2019, which is 86% higher than the same period a year earlier. The growth is primarily from the full year consolidation of the NH Group and to a lesser extent, organic growth and income from mixed-use businesses, which includes real estate sales and Anantara Vacation Club.
At the end of 2019, MINT's total number of restaurants reached 2,377 comprising 1,198 equity-owned outlets and 1,179 franchised outlets. Approximately 66% were in Thailand with the remaining number in 25 other countries in Asia, Oceania, Middle East, Europe, Canada and Mexico. Approximately 107 restaurants were added during 2019. Due to a challenging market, average same-store-sales growth declined by 3% (in a local currency basis) however total revenue (including share of profit and other income) grew by 3% during the same period.
The retail trading and contract manufacturing businesses grew revenue (including share of profit and other income) by 12% with revenues of THB5.0 billion during 2019.
Symphony's gross and net investment cost in MINT was approximately US$74.02 million and (US$83.86 million) (2018: US$74.02 million and (US$64.55 million)), respectively, at 31 December 2019. The negative net cost is due to the proceeds from partial realisations being in excess of cost for this investment. On the same date, the fair value of Symphony's investment in MINT was US$277.83 million, which is up from US$257.79 million a year earlier. The change in value of approximately US$20.04 million was due to the sale of 15.0 million shares during the year that generated proceeds of US$19.31 million, which was more than offset by an increase in the share price by 5.1% and an appreciation in the onshore Thai baht by 7.9% during the same period. The annualised return and times the original cost of investment on the partial sale of shares in 2019 was 16.7% and 5.4 times, respectively.
Minuet Limited
Minuet Ltd ("Minuet") is a joint venture between the Company and an established Thai partner. The Company has a direct 49% interest in the venture and is considering several development and/or sale options for the land owned by Minuet, which is located in close proximity to central Bangkok, Thailand. As at 31 December 2019, Minuet held approximately 252 rai (40 hectares) of land in Bangkok, Thailand.
The Company initially invested approximately US$78.30 million by way of an equity investment and interest-bearing shareholder loans. Since the initial investment by the Company, Minuet has received proceeds from rental income and partial land sales. As at 31 December 2019, the Company's investment cost (net of shareholder loan repayments) was approximately US$32.12 million (31 December 2018: US$32.12 million). The fair value of the Company's interest in Minuet on the same date was US$80.29 million (31 December 2018: US$73.55 million) based on an independent third party valuation of the land plus the net value of the other assets and liabilities of Minuet. The change in value of Symphony's interest by US$6.73 million is predominantly due to an 8.1% appreciation in the Thai baht and other minor movements in the net assets of Minuet.
IHH Healthcare Berhad
IHH Healthcare Berhad ("IHH") is one of the largest healthcare providers in the world by market capitalisation. Its portfolio of healthcare assets includes Parkway Holdings Limited, Pantai Holdings Berhad, International Medical University ("IMU"), Acibadem Saglik Yatirimlari Holding A.S. ("Acibadem") and Fortis Healthcare Limited ("Fortis"). IHH has a broad footprint of assets in Asia as well as Turkey, Abu Dhabi, Central and Eastern Europe that employs 55,000 people and operates over 15,000 licensed beds in 80 hospitals in ten countries worldwide.
IHH reported revenue and EBITDA growth of 29% and 34%, respectively, in 2019 year-over-year. On a constant currency basis and excluding the impact from MFRS 16 Leases, revenue and EBITDA increased by 22% and 13% during the same period, respectively. The growth is due to the continuous ramp up of Gleneagles Hong Kong Hospital and Acibadem Altunizade Hospital (both opened in March 2017), as well as contribution from the increased capacity at Acibadem Maslak Hospital (expansion completed in Oct 2018). The acquisition of Amanjaya (acquired in October 2018), and Fortis (acquired in November 2018) also contributed to the increase in revenue and EBITDA.
Parkway Pantai saw in-patient admissions increase by 2.1% and 7.2% in Singapore and Malaysia in 2019, respectively, compared to a year earlier. Average revenue per inpatient admission also increased by 4.5% in Singapore and 6.6% in Malaysia during the same period. On a constant currency basis and excluding the effects of adopting MFRS 16 Leases, Parkway Pantai's revenue and EBITDA increased by 43% and 29% in 2019 year-over-year, respectively.
Acibadem saw admissions decrease by 3.5% due to fewer local patients at non-Istanbul hospitals however, revenue per inpatient grew by 17.9% in 2019 compared to a year earlier. On a constant currency basis and excluding the effects of adopting MFRS 16 Leases, Acibadem's revenue and EBITDA increased by 18% and 30% in 2019 year-over-year, respectively.
The Company's gross and net investment cost in IHH was US$50.11 million and (US$31.87 million) (31 December 2018: US$50.11 million and (US$25.22 million), respectively at 31 December 2019. The negative net cost at 31 December 2019 is due to proceeds from partial realisations being in excess of cost for this investment. The fair value on the same date was US$4.66 million (31 December 2018: US$11.04 million). The change in value is predominantly due to the sale of 5.0 million shares that generated net proceeds of US$6.65 million, which was marginally offset by a strengthening in the share price of IHH by 1.9% and an appreciation of the Malaysian ringgit by 1.0%. Subsequent to 31 December 2019, Symphony fully exited its residual interest in IHH of 3.49 million shares that generated net proceeds of US$4.65 million. Over a holding period of approximately 8-years, Symphony generated an annual compounded return rate of 11.2% and 1.8 times the cost of investment.
Liaigre Group
The Liaigre Group ("Liaigre") was founded in 1985 in Paris and is a brand synonymous with discreet luxury, and has become one of the most sought-after luxury furniture brands, renowned for its minimalistic design style. Liaigre has a strong intellectual property portfolio and provides a range of bespoke furniture, lighting, fabric & leather, and accessories. In addition to operating a network of 26 showrooms in 11 countries across Europe, the US and Asia, Liaigre undertakes exclusive interior architecture projects for select yachts, hotels, and restaurants and private residences.
Liaigre continued to expand its operations in Asia with the opening of a new flagship showroom in Shanghai, which brings the total number of showrooms in the region to four. Despite group sales in 2019 being at the same level as 2018 due to the underperformance of showrooms in Europe, Asia continues to see strength in demand, particularly in the interior architecture business. Sales in Asia rose by 166% in 2019 and is becoming a more material part of the overall group. However, the overall business continues to underperform, and we are working with our partners and management to address operational shortcomings.
During the first quarter of 2019, Symphony sold part of its interest in the Liaigre Group to facilitate a new strategic investor. The sale of shares was completed at a premium to the cost of the investment. The new strategic investor also provided new capital to facilitate expanding Liaigre into new complementary businesses to fully realise the brand's potential. Due to the underperformance of the business to date, the fair value of Symphony's investment as at 31 December 2019 is below the initial cost.
Symphony, together with Navis Capital Partners and management, acquired Liaigre in June 2016 for an undisclosed sum. Symphony's investment cost is more than 5% of NAV and due to strategic concerns, specific valuation information has not been disclosed publicly.
Property Joint Venture in Malaysia
The Company has a 49% interest in a property joint venture in Malaysia with an affiliate of Destination Resorts and Hotels Sdn Bhd, a hotel and destination resort investment subsidiary of Khazanah Nasional Berhad, the investment arm of the Government of Malaysia. The joint venture is developing a beachfront country club and private villas on the south-eastern coast of Malaysia.
The development scheduled to be launched in late March 2020 with the opening of the hotel that has 46 club suites. The private villa sales will commence shortly thereafter and will comprise 52 villas when fully developed. As mentioned in earlier investor communications, the project has experienced delays and required additional investment due to rectification costs. During 2019, an arbitration proceeding initiated by the previous hotel management company for the loss of their management contract resulted in the joint venture being liable to pay a material sum. However, the arbitrator rejected the previous manager's claim for the loss of future royalties. As a result, the joint venture expects to achieve cost savings from the effective buyout of the previous management contract due to significantly reduced royalties payable to the new hotel management company.
The Company invested approximately US$29.05 million in January 2012 for its interest in Desaru and since made follow-on investments amounting to US$18.55 million. Based on an independent third party valuation, the investment was valued at US$33.53 million at 31 December 2019 (31 December 2018: US$33.58 million).
Indo Trans Logistics Corporation
Indo Trans Logistics Corporation ("ITL") was founded in 2000 as a freight-forwarding company and has since grown to become Vietnam's largest independent integrated logistics company with a network that is spread across Vietnam, Cambodia, Laos, Myanmar, and Thailand. ITL has grown to national champion status in Vietnam with over 2,000 employees across its business units and joint ventures.
The Company acquired a significant minority interest in Indo Trans Logistics Corporation ("ITL") in June 2019 for US$42.64 million. In accordance with the Company's investment policies, investments held less than 12-months are valued at cost.
Subsequent to the 2019 financial year, South Logistics Joint Stock Company ("SoTrans"), a listed operator of ports and other logistics infrastructure in which ITL owns a 42% interest announced that ITL has indicated its intent to acquire the majority of the remaining shares in SoTrans. This acquisition is expected to enable ITL to grow its freight forwarding and contract logistics businesses, and reduce its reliance on the air cargo business. The investment manager is working with ITL's management to secure debt funding related to this transaction.
Other Investments
In addition to the investments above, Symphony has 11 additional non-material investments, at 31 December 2019. Pending investment in suitable opportunities, Symphony has placed funds in certain temporary investments.
Capitalisation and NAV
As at 31 December 2019, the Company had US$409.70 million (31 December 2018: US$409.70 million) in issued share capital and its NAV was approximately US$503.37 million (31 December 2018: US$492.71 million). Symphony's NAV is the sum of its cash and cash equivalents, temporary investments, the fair value of unrealised investments (including investments in subsidiaries, associates and joint ventures) and any other assets, less any other liabilities. The unaudited financial statements contained herein may not account for the fair value of certain unrealised investments. Accordingly, Symphony's NAV may not be comparable to the net asset value in the unaudited financial statements. The primary measure of SIHL's financial performance and the performance of its subsidiaries will be the change in Symphony's NAV per share resulting from changes in the fair value of investments.
Symphony was admitted to the Official List of the London Stock Exchange ("LSE") on 3 August 2007 under Chapter 14 of the Listing Manual of the LSE. The proceeds from the IPO amounted to US$190 million before issue expenses pursuant to which 190.0 million new shares were issued in the IPO. In addition to these 190.0 million shares and 94.9 million shares pre-IPO, a further 53.4 million shares were issued comprising of the subscription of 13.2 million shares by investors and SIHL's investment manager, the issue of 33.1 million bonus shares, and the issue of 7.1 million shares to SIHL's investment manager credited as fully paid raising the total number of issued shares to 338.3 million.
The Company issued 4,119,490 shares, 2,059,745 shares, 2,059,745 shares and 2,059,745 shares on 6 August 2010, 21 October 2010, 4 August 2011 and 23 October 2012, respectively, credited as fully paid, to the Investment Manager, Symphony Investment Managers Limited. The shares were issued as part of the contractual arrangements with the Investment Manager.
On 4 October 2012, SIHL announced a fully underwritten 0.481 for 1 rights issue at US$0.60 per new share to raise proceeds of approximately US$100 million (US$93 million net of expenses) through the issue of 166,665,997 million new shares, fully paid, that commenced trading on the London Stock Exchange on 22 October 2012.
As part of the contractual arrangements with the Investment Manager in the Investment Management Agreement, as amended, the Investment Manager was granted 82,782,691 and 41,666,500 share options to subscribe for ordinary shares at an exercise price of US$1.00 and US$0.60 on 3 August 2008 and 22 October 2012, respectively. The share options vest in equal tranches over a five-year period from the date of grant. As at 31 December 2018, 41,666,500 share options with an exercise price of US$0.60 had been exercised and all the 82,782,691 options had lapsed and expired. There were no share options outstanding at 31 December 2019.
During 2017, 43,525,000 shares were bought back and cancelled, as part of a share buyback programme announced on 16 January 2017. Together with the shares issued to the Investment Manager, the shares issued pursuant to the rights issue, shares issued pursuant to the exercise of options and shares cancelled pursuant to the share buyback programme, the Company's fully paid issued share capital was 513.4 million shares at 31 December 2019 (2018: 513.4 million shares).
Revenue and Other Operating Income
Management concluded during 2014 that the Company meets the definition of an investment entity and adopted IFRS 10, IFRS 12 and IAS 27 standards where subsidiaries are de-consolidated and their fair value is measured through profit or loss. As a result, revenue, such as dividend income, from underlying investments in subsidiaries is no longer consolidated.
During 2019, Symphony recognised other operating income of US$784,000, which mainly comprised interest income from bank deposits, loan interest and dividends from unconsolidated subsidiaries (predominantly relating to intercompany transactions). This compares to other operating income of US$26.14 million in 2018 that comprised the same items.
Expenses
Other Operating Expenses
Other operating expenses include fees for professional services, interest expense, insurance, communication, travel, Directors' fees and other miscellaneous expenses and costs incurred for analysis of proposed deals. For the year ended 31 December 2019, other operating expenses amounted to US$3.16 million which included non-cash foreign exchange losses of US$0.53 million. Excluding the foreign exchange losses and interest expense related to bank borrowings, other operating expenses were US$1.23 million in 2019, which compares to US$1.17 million of operating expenses on the same basis in 2018.
Management Fee
The management fee amounted to US$11.84 million for the year ended 31 December 2019 (2018: US$12.25 million). The management fee was calculated on the basis of 2.25% of NAV (with a floor and cap of US$8 million and US$15 million per annum, respectively) pursuant to the Investment Management Agreement.
Share-based Payment Transactions
Under the terms of the Investment Management and Advisory Agreement, the Investment Manager was granted share options to subscribe for shares of the Company. On 3 August 2008, the Investment Manager was granted 82,782,691 share options to subscribe for shares at US$1.00 each and on 22 October 2012, the Investment Manager was granted 41,666,500 share options to subscribe for shares at US$0.60 each. The share options vest in five equal tranches over a period of five years. All the share options were fully vested and expensed at 31 December 2017. During the year ended 31 December 2018, the 82,782,691 share options granted on 3 August 2008 that were exercisable on or before 2 August 2018 have lapsed unexercised. These lapsed options cannot be reissued to the Investment Manager.
Liquidity and Capital Resources
At 31 December 2019, Symphony's cash balance was US$7.67 million (2018: US$11.54 million). Symphony's primary uses of cash are to fund investments, pay expenses and to make distributions to shareholders, as declared by our board of directors. Symphony can generate additional cash from time-to-time from the sale of listed securities that are liquid and amount to US$282,494,000 (2018: US$268,832,000) and which are held through intermediate holding companies. Taking into account current market conditions, it is expected that Symphony has sufficient liquidity and capital resources for its operations. The primary sources of liquidity are capital contributions received in connection with the initial public offering of shares, related transactions and a rights issue (See description under "Capitalisation and NAV"), in addition to cash from investments that it receives from time to time and bank facilities.
This cash from investments is in the form of dividends on equity investments, payments of interest and principal on fixed income investments and cash consideration received in connection with the disposal of investments. Temporary investments made in connection with Symphony's cash management activities provide a more regular source of cash than less liquid longer-term and opportunistic investments, but generate lower expected returns. Other than amounts that are used to pay expenses, or used to make distributions to our shareholders, any returns generated by investments are reinvested in accordance with Symphony's investment policies and procedures. Symphony may enter into one or more credit facilities and/or utilise other financial instruments from time to time with the objective of increasing the amount of cash that Symphony has available for working capital or for making opportunistic or temporary investments. At 31 December 2019, the Company had total interest-bearing borrowings of US$72.88 million (2018: US$5.33 million), which consists of US$5.43 million (2018: US$5.33 million) associated with a property related investment in Niseko, Hokkaido, Japan and bank debt of US$67.45 million (2018: Nil). The bank debt is secured by listed securities held by the Company.
Principal Risks
The Company's and the Company's investment management team's past performance is not necessarily indicative of the Company's future performance and any unrealised values of investments presented in this document may not be realised in the future.
The Company is not structured as a typical private equity vehicle (it is structured as a permanent capital vehicle), and thus may not have a comparable investment strategy. The investment opportunities for the Company are more likely to be as a long-term strategic partner in investments, which may be less liquid and which are less likely to increase in value in the short term.
The Company's organisational, ownership and investment structure may create certain conflicts of interests (for example in respect of the directorships, shareholdings or interests, including in portfolio companies that some of the Directors and members of the Company's investment management team may have). In addition, neither the Investment Manager nor any of its affiliates owes the Company's shareholders any fiduciary duties under the Investment Management Agreement between, inter alia, the Company and the Investment Manager. The Company cannot assume that any of the foregoing will not result in a conflict of interest that will have a material adverse effect on the business, financial condition and results of operations.
The Company is highly dependent on the Investment Manager, the Key Persons (as defined in the Investment Management Agreement) and the other members of the Company's investment management team and the Company cannot assure shareholders that it will have continued access to them or their undivided attention, which could affect the Company's ability to achieve its investment objectives.
The Investment Manager's remuneration is based on the Company's NAV (subject to minimum and maximum amounts) and is payable even if the NAV does not increase, which could create an incentive for the Investment Manager to increase or maintain the NAV in the short term (rather than the long-term) to the potential detriment of Shareholders.
The Company's investment policies contain no requirements for investment diversification and its investments could therefore be concentrated in a relatively small number of portfolio companies in the Healthcare, Hospitality, Lifestyle (including branded real estate developments), logistics and education sectors predominantly in Asia.
The Company has made, and may continue to make, investments in companies in emerging markets, which exposes it to additional risks (including, but not limited to, the possibility of exchange control regulations, political and social instability, nationalisation or expropriation of assets, the imposition of taxes, higher rates of inflation, difficulty in enforcing contractual obligations, fewer investor protections and greater price volatility) not typically associated with investing in companies that are based in developed markets.
Furthermore, the Company has made, and may continue to make, investments in portfolio companies that are susceptible to economic recessions or downturns. Such economic recessions or downturns may also affect the Company's ability to obtain funding for additional investments.
The Company's investments include investments in companies that it does not control and/or made with other co-investors for financial or strategic reasons. Such investments may involve risks not present in investments where the Company has full control or where a third party is not involved. For example, there may be a possibility that a co-investor may have financial difficulties or become bankrupt or may at any time have economic or business interests or goals which are inconsistent with those of the Company or may be in a position to take or prevent actions in a manner inconsistent with the Company's objectives. The Company may also be liable in certain circumstances for the actions of a co-investor with which it is associated. In addition, the Company holds a non-controlling interest in certain investments, and therefore, may have a limited ability to protect its position in such investments.
A number of the Company's investments are currently, and likely to continue to be, illiquid and/ or may require a long-term commitment of capital. The Company's investments may also be subject to legal and other restrictions on resale. The illiquidity of these investments may make it difficult to sell investments if the need arises.
The Company's real estate related investments may be subject to the risks inherent in the ownership and operation of real estate businesses and assets. A downturn in the real estate sector or a materialization of any of the risks inherent in the real estate business and assets could materially adversely affect the Company's real estate investments. The Company's portfolio companies also anticipate selling a significant proportion of development properties prior to completion. Any delay in the completion of these projects may result in purchasers terminating off-plan sale agreements and claiming refunds, damages and/or compensation.
The Company is exposed to foreign exchange risk when investments and/ or transactions are denominated in currencies other than the U.S. dollar, which could lead to significant changes in the net asset value that the Company reports from one quarter to another.
The Company's investment policies and procedures (which incorporate the Company's investment strategy) provide that the Investment Manager should review the Company's investment policies and procedures on a regular basis and, if necessary, propose changes to the Board when it believes that those changes would further assist the Company in achieving its objective of building a strong investment base and creating long term value for its Shareholders. The decision to make any changes to the Company's investment policy and strategy, material or otherwise, rests with the Board in conjunction with the Investment Manager and Shareholders have no prior right of approval for material changes to the Company's investment policy.
Investments in connection with special situations and structured transactions typically have shorter operating histories, narrower product lines and smaller market shares than larger businesses, which tend to render them more vulnerable to competitors' actions and market conditions, as well as general economic downturns. Investments that fall into this category tend to have relatively short holding periods and entail little or no participation in the board of the company in which such investments may be made. Special situations and structured transactions in the form of fixed debt investments also carry an additional risk that an increase in interest rates could decrease their value.
The Company's current investment policies and procedures provide that it may invest an amount of no more than 30% of its total assets in special situations and structured transactions which, although they are not typical longer-term investments, have the potential to generate attractive returns and enhance the Company's net asset value. Following the Company's investment, it may be that the proportion of its total assets invested in longer-term investments falls below 70% and the proportion of its total assets invested in special situations and structured transactions exceeds 30% due to changes in the valuations of the assets, over which the Company has no control.
Pending the making of investments, the Company's capital will need to be temporarily invested in liquid investments and managed by a third-party investment manager of international repute or held on deposit with commercial banks before they are invested. The returns that temporary investments are expected to generate and the interest that the Company will earn on deposits with commercial banks will be substantially lower than the returns that it anticipates receiving from its longer-term investments or special situations and structured transactions.
In addition, while the Company's temporary investments will be relatively conservative compared to its longer- term investments or special situations and structured transactions, they are nevertheless subject to the risks associated with any investment, which could result in the loss of all or a portion of the capital invested.
The Investment Manager has identified but has not yet contracted to make further potential investments. The Company cannot guarantee shareholders that any or all of these prospective investments will take place in the future.
The market price of the Company's shares may fluctuate significantly and shareholders may not be able to resell their shares at or above the price at which they purchased them.
The Company's shares are currently trading, and have in the past traded, and could in the future trade, at a discount to NAV for a variety of reasons, including due to market conditions. The only way for shareholders to realise their investment is to sell their shares for cash. Accordingly, in the event that a shareholder requires immediate liquidity, or otherwise seeks to realise the value of his investment through a sale, the amount received by the shareholder upon such sale may be less than the underlying NAV of the shares sold.
ANIL THADANI
Chairman, Symphony Asia Holdings Pte. Ltd.
11 March 2020
Symphony International Holdings Limited
Unaudited condensed statement of financial position
As at 31 December 2019
|
|
Note |
2019 |
2018 |
|
|
|
US$'000 |
US$'000 |
|
Non-current assets |
|
|
|
|
Financial assets at fair value through profit or loss |
9 |
569,339 |
486,790 |
|
|
|
569,339 |
486,790 |
|
Current assets |
|
|
|
|
Other receivables and prepayments |
|
69 |
72 |
|
Cash and cash equivalents |
|
7,671 |
11,538 |
|
|
|
7,740 |
11,610 |
|
Total assets |
|
577,079 |
498,400 |
|
|
|
|
|
|
Equity attributable to equity holders |
|
|
|
|
Share capital |
|
409,704 |
409,704 |
|
Accumulated profits |
|
93,945 |
83,001 |
|
Total equity carried forward |
|
503,649 |
492,705 |
|
|
|
|
|
|
Current liabilities |
|
|
|
|
Interest-bearing borrowings |
|
72,879 |
5,327 |
|
Other payables |
|
551 |
368 |
|
Bank overdraft |
|
- |
* |
|
Total liabilities |
|
73,430 |
5,695 |
|
Total equity and liabilities |
|
577,079 |
498,400 |
* Less than US$1,000
Symphony International Holdings Limited
Unaudited condensed statement of comprehensive income
For the financial year ended 31 December 2019
|
|
Note |
2019 |
2018 |
|
|
|
US$'000 |
US$'000 |
|
|
|
|
|
|
Other operating income |
7 |
784 |
26,142 |
|
Other operating expenses |
8 |
(3,156) |
(4,157) |
|
Management fees |
|
(11,839) |
(12,248) |
|
(Loss)/Profit before investment results and income tax |
|
(14,211) |
9,737 |
|
Loss on disposal of financial assets at fair value through profit or loss |
|
(410) |
(19) |
|
Fair value changes in financial assets at fair value |
9 |
43,533 |
(79,234) |
|
Profit/ (Loss) before income tax |
|
28,912 |
(69,516) |
|
Income tax expense |
|
* |
- |
|
Profit/(Loss) for the year |
|
28,912 |
(69,516) |
|
Other comprehensive income for the year, net of tax |
|
- |
- |
|
Total comprehensive income for the year |
|
28,912 |
(69,516) |
|
|
|
|
|
|
Earnings per share: |
|
|
|
|
|
|
US Cents |
US Cents |
|
|
|
|
|
|
Basic |
11 |
5.63 |
(13.99) |
|
Diluted |
|
5.63 |
(13.99) |
Symphony International Holdings Limited
Unaudited condensed statement of changes in equity
For the financial year ended 31 December 2019
|
|
Share |
Equity compensation reserve |
Accumulated profits |
Total |
|
|
US$'000 |
US$'000 |
US$'000 |
US$'000 |
|
|
|
|
|
|
|
At 1 January 2018 |
382,797 |
62,298 |
173,577 |
618,672 |
|
|
|
|
|
|
|
Total comprehensive income for the year |
- |
- |
(69,516) |
(69,516) |
|
|
|
|
|
|
|
Transactions with owners of the Company, recognised directly in equity |
|
|
|
|
|
Contributions by and distributions to owners |
|
|
|
|
|
Issuance of shares |
15,087 |
- |
- |
15,087 |
|
Share options lapsed during the year |
- |
(50,478) |
50,478 |
- |
|
Exercise of share options |
11,820 |
(11,820) |
- |
- |
|
Dividend paid of US$ 0.12 per share |
- |
- |
(71,538) |
(71,538) |
|
Total transaction with owners of the Company |
26,907 |
(62,298) |
(21,060) |
(56,451) |
|
|
|
|
|
|
|
At 31 December 2018 |
409,704 |
- |
83,001 |
492,705 |
|
|
|
|
|
|
|
At 1 January 2019 |
409,704 |
- |
83,001 |
492,705 |
|
|
|
|
|
|
|
Total comprehensive income for the year |
- |
- |
28,912 |
28,912 |
|
|
|
|
|
|
|
Transactions with owners of the Company, recognised directly in equity |
|
|
|
|
|
Contributions by and distributions to owners |
|
|
|
|
|
Dividend paid of US$ 0.035 per share |
- |
- |
(17,968) |
(17,968) |
|
Total transaction with owners of the Company |
- |
- |
(17,968) |
(17,968) |
|
|
|
|
|
|
|
At 31 December 2019 |
409,704 |
- |
93,945 |
503,649 |
Symphony International Holdings Limited
Unaudited condensed statement of cash flows
For the financial year ended 31 December 2019
|
|
|
2019 |
2018 |
|
|
|
US$'000 |
US$'000 |
|
Cash flows from operating activities |
|
|
|
|
P rofit/ (Loss) before income tax |
|
28,912 |
(69,516) |
|
Adjustments for: |
|
|
|
|
Dividend income |
|
(231) |
(25,841) |
|
Exchange loss, net |
|
534 |
2,785 |
|
Interest income |
|
(553) |
(301) |
|
Interest expense |
|
1,389 |
199 |
|
Loss on disposal of financial assets at fair value through profit or loss |
|
410 |
19 |
|
Fair value changes in financial assets at fair value through profit or loss |
|
(43,533) |
79,234 |
|
|
|
(13,072) |
(13,421) |
|
Changes in: |
|
|
|
|
- Other receivables and prepayments |
|
* |
16 |
|
- O ther payables |
|
60 |
(20) |
|
|
|
(13,012) |
(13,425) |
|
Interest received (net of withholding tax) |
|
682 |
290 |
|
Net cash used in operating activities |
|
(12,330) |
(13,135) |
|
|
|
|
|
|
Cash flows from investing activity |
|
|
|
|
Net proceeds (provided to)/received from unconsolidated subsidiaries |
|
(48,460) |
65,602 |
|
Net proceeds received from financial assets at fair value through profit and loss |
|
8,654 |
- |
|
Net cash (used in)/from investing activity |
|
(39,806) |
65,602 |
|
|
|
|
|
|
Cash flows from financing activities |
|
|
|
|
Proceeds from issuance of shares |
|
- |
15,087 |
|
Interest paid |
|
(1,268) |
(199) |
|
Dividend paid |
|
(17,968) |
(71,538) |
|
Proceeds from borrowings |
|
67,483 |
34 |
|
Net cash from/(used in) financing activities |
|
48,247 |
(56,616) |
|
|
|
|
|
|
Net decrease in cash and cash equivalents |
|
(3,889) |
(4,149) |
|
Cash and cash equivalents at 1 January |
|
11,538 |
15,689 |
|
Effect of exchange rate fluctuations |
|
22 |
(2) |
|
Cash and cash equivalents at 31 December |
|
7,671 |
11,538 |
* Less than US$1,000
|
Significant non-cash transactions
During the financial year ended 31 December 2019, the Company received dividends of $231,000 ( 2018 : $ 25,841,000 ) from its unconsolidated subsidiaries of which $231,000 ( 2018 : $ 25,841,000 ) was set off against the non-trade amounts due to the unconsolidated subsidiaries.
During the financial year ended 31 December 2018, the Company declared dividends of $71,538,000 of which $1,509,000 was offset against the amount due from the Investment Manager from the exercise of share options. |
Symphony International Holdings Limited
Notes to the unaudited condensed financial statements
For the financial year ended 31 December 2019
These notes form an integral part of the unaudited condensed financial statements
1 Reporting entity
Symphony International Holdings Limited (the "Company") is a company domiciled in the British Virgin Islands.
2 Statement of compliance
The accounting policies applied by the Company in these condensed financial statements are the same as those applied by the Company in its financial statements as at and for the year ended
31 December 2018, except for the adoption of the following new accounting standards and interpretations effective for annual periods beginning on 1 January
2019
:
· IFRS 16 Leases
· IFRIC 23 Uncertainty over Income Tax Treatment
· Amendments to IAS 28 Long-term Interests in Associates and Joint Ventures
· Amendments to IFRS 9 Prepayment Features with Negative Compensation
· Amendments to IFRS 3 and 11 Previously Held Interest in a Joint Operation
· Amendments to IAS 12 Income Tax Consequences of Payments on Financial Instruments Classified as Equity
· Amendments to IAS 23 Borrowing Costs Eligible for Capitalisation
· Amendments to IAS 19 Plan Amendment, Curtailment or Settlement
The application of the above standards and interpretations did not have a material effect on the financial statements.
These unaudited condensed financial statements were approved by the Board of Directors on 11 March 2020.
3 Basis of preparation
The financial statements have been prepared on a fair value basis, except for certain items which are measured on a historical cost basis. The financial statements are presented in thousands of United States dollars (US$'000), which is the Company's functional currency, unless otherwise stated.
4 Going concern
As at 31 December 2019, the Company's current liabilities exceeded its current assets by US$65,690,000. The Company, through its intermediate holding companies, holds listed securities amounting to US$282,494,000 (2018: US$268,832,000). These listed securities are liquid and can therefore be sold from time-to-time to generate additional cash to settle any existing and ongoing liabilities of the Company. The directors are therefore confident that the use of the going concern assumption for the preparation of these unaudited condensed financial statements for the year ended 31 December 2019 remains appropriate.
5 Estimates and judgement
The preparation of these unaudited condensed financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates.
In preparing these unaudited condensed financial statements, the significant judgements made by management in applying the Company's accounting policies and the key sources of estimation uncertainty were the same as those that applied to the financial statements as at and for the year ended 31 December 2018.
6 Financial risk management
The Company's financial risk management objectives and policies are consistent with those disclosed in the financial statements as at and for the year ended 31 December 2018 .
7 Other operating income
|
|
|
2019 |
2018 |
|
|
|
US$'000 |
US$'000 |
|
|
|
|
|
|
Dividend received |
|
231 |
25,841 |
|
Interest income |
|
553 |
301 |
|
Other income |
|
* |
- |
|
|
|
784 |
26,142 |
* Less than US$1,000
8 Other operating expenses
|
|
|
2019 |
2018 |
|
|
|
US$'000 |
US$'000 |
|
|
|
|
|
|
Exchange loss, net |
|
534 |
2,785 |
|
Non-executive director remuneration |
|
384 |
386 |
|
General operating expenses |
|
2,238 |
986 |
|
|
|
3,156 |
4,157 |
9 Financial assets at fair value through profit or loss
During the financial year ended 31 December 2019 , the Company recognised changes in the financial assets at fair value through profit and loss of a gain of US$43,533,000 (31 December 2018 : loss of US$ 79,234,000 ).
10 Financial instruments
Carrying amounts versus fair values
The fair values of financial assets and financial liabilities, together with the carrying amounts in the unaudited condensed statement of financial position, are as follows. It does not include fair value information for financial assets and financial liabilities not measured at fair value if the carrying amount is a reasonable approximation of fair value.
|
|
Carrying amount |
|
|||
|
|
Fair value through |
Amortised cost |
Other financial liabilities |
Total |
Fair value |
|
|
US$'000 |
US$'000 |
US$'000 |
US$'000 |
US$'000 |
|
31 December 2019 |
|
|
|
|
|
|
Financial assets measured at fair value |
|
|
|
|
|
|
Financial assets at fair value through profit or loss |
569,339 |
- |
- |
569,339 |
569,339 |
|
Financial assets not measured |
|
|
|
|
|
|
Other receivables1 |
- |
11 |
- |
11 |
|
|
Cash and cash equivalents |
- |
7,671 |
- |
7,671 |
|
|
|
569,339 |
7,682 |
- |
577,021 |
|
|
Financial liabilities not measured at fair value |
|
|
|
|
|
|
Other payables |
- |
- |
(551) |
(551) |
|
|
Interest-bearing borrowings |
- |
- |
(72,879) |
(72,879) |
|
|
|
- |
- |
(73,430) |
(73,430) |
|
|
31 December 2018 |
|
|
|
|
|
|
Financial assets measured at fair value |
|
|
|
|
|
|
Financial assets at fair value through profit or loss |
486,790 |
- |
- |
486,790 |
486,790 |
|
Financial assets not measured |
|
|
|
|
|
|
Other receivables1 |
- |
12 |
- |
12 |
|
|
Cash and cash equivalents |
- |
11,538 |
- |
11,538 |
|
|
|
486,790 |
11,550 |
- |
498,340 |
|
|
Financial liabilities not measured at fair value |
|
|
|
|
|
|
Other payables |
- |
- |
(368) |
(368) |
|
|
Interest-bearing borrowings |
- |
- |
(5,327) |
(5,327) |
|
|
Bank overdraft |
- |
- |
* |
* |
|
|
|
- |
- |
(5,695) |
(5,695) |
|
1 Excludes prepayments
* Less than US$1,000
Quoted investments
Fair value is based on quoted market bid prices at the reporting date without any deduction for transaction costs.
Unquoted investments
The fair value of unquoted equity investments including joint ventures and associates are measured with reference to the enterprise value at which the portfolio company could be sold in an orderly disposition over a reasonable period of time between willing parties other than in a forced or liquidation sale, and is determined by using valuation techniques such as (a) market multiple approach that uses a specific financial or operational measure that is believed to be customary in the relevant industry, (b) price of recent investment, or offers for investment, for the portfolio company's securities, (c) current value of publicly traded comparable companies, (d) comparable recent arms' length transactions between knowledgeable parties, and (e) discounted cash flows analysis.
Other financial assets and liabilities
The notional amounts of financial assets and liabilities with a maturity of less than one year or which reprice frequently (including other receivables, cash and cash equivalents, other payables, interest-bearing borrowings and bank overdraft) are assumed to approximate their fair values because of the short period to maturity/repricing.
The objective of valuation techniques is to arrive at a fair value measurement that reflects the price that would be received to sell the asset or paid to transfer the liability in an orderly transaction between market participants at the measurement date.
Fair value hierarchy for financial instruments
The table below analyses financial instruments carried at fair value, by valuation method. The different levels have been defined as follows:
· Level 1: Inputs that are quoted market prices (unadjusted) in active markets for identical instruments.
· Level 2: Inputs other than quoted prices included within Level 1 that are observable, either directly (i.e. as prices) or indirectly (i.e. derived from prices). This category includes instruments valued using: quoted market prices in active markets for similar instruments; quoted prices for identical or similar instruments in markets that are considered less than active; or other valuation techniques in which all significant inputs are directly or indirectly observable from market data.
· Level 3: Inputs that are unobservable. This category includes all instruments for which the valuation technique includes input not based on observable data and the unobservable inputs have a significant effect on the instruments' valuation. This category includes instruments that are valued based on quoted prices for similar instruments but for which significant unobservable adjustments or assumptions are required to reflect differences between instruments.
|
|
Level 1 |
Level 2 |
Level 3 |
Total |
|
|
US$'000 |
US$'000 |
US$'000 |
US$'000 |
|
31 December 2019 |
|
|
|
|
|
Financial assets at fair value through profit or loss |
- |
- |
569,339 |
569,339 |
|
|
|
|
|
|
|
31 December 2018 |
|
|
|
|
|
Financial assets at fair value through profit or loss |
- |
- |
486,790 |
486,790 |
Significant unobservable inputs used in measuring fair value
This table below sets out information about significant unobservable inputs used at 31 December 2019 in measuring the underlying investments of the financial assets categorised as Level 3 in the fair value hierarchy excluding investments purchased during the year that are valued at transaction prices as they are reasonable approximation of fair values and ultimate investments in listed entities.
|
Desription |
Fair value at 31 December 2019 |
Fair value at 31 December 2018 |
Valuation technique |
Unobservable input |
Range (Weighted average) |
Sensitivity to changes in |
|
US$'000 |
US$'000 |
|||||
|
|
|
|
|
|
|
|
|
Rental properties |
8,804 |
10,531 |
Income approach |
Rental growth rate Occupancy rate
Discount rate |
0%-6 % ( 2018 : 0%-6 %) 80%-90% ( 2018 : 80%-87 %) 13%-13.5% ( 2018 : 13%-13.5%) |
The estimated fair value would increase if the rental growth rate and occupancy rate were higher and the discount rate was lower. |
|
|
|
|
|
|
|
|
|
Land related investments |
137,044 |
107,659 |
Comparable valuation method |
Price per square meter for comparable land |
US$76 to US$4,143 per square meter ( 2018 : US$73 to US$4,102 per square meter) |
The estimated fair value would increase if the price per square meter was higher. |
|
|
|
|
|
|
|
|
|
Operating business |
33,415 |
68,609 |
Enterprise value using comparable traded multiples or adjusted net tangible asset value |
EBITDA multiple (times) |
3.0x to 19.4x, median 9.1x ( 2018 : 4.1x to 19.7x, median 10.7x) |
The estimated fair value would increase if the EBITDA multiple was higher. |
|
|
|
|
|
|
|
|
|
|
|
|
Discount for lack of marketability |
25% ( 2018 : 20%) |
The estimated fair value would increase if the discount for lack of marketability was lower. |
|
|
|
|
|
|
|
|
|
|
|
|
|
Discount to tangible assets for lack of liquidity |
25% to 100%, ( 2018 : Nil) |
The estimated fair value would increase if the discount was lower. |
|
|
|
|
|
|
Price of recent transaction |
Nil (2018: N/A) |
N/A |
|
|
|
|
|
|
|
|
|
Greenfield business held for more than 12-months |
23,484 |
16,042 |
Discounted cashflow method |
Revenue growth
Expense ratio
Weighted average cost of capital ("WACC")
|
3.8%-56.0 % ( 2018 : 3.8%-172.2%) 73.7%-102.5 % ( 2018 : 73.7%-193.5 %) 10.7% ( 2018 : 11.5%) |
The estimated fair value would increase if the revenue growth increases, expenses ratio decreases, and WACC was lower. |
The rental growth rate represents the growth in rental income during the leasehold period while the occupancy rates represent the percentage of the building that is expected to be occupied during the leasehold period. Management adopts a valuation report produced by an independent valuer that determines the rental growth rate and occupancy rate after considering the current market conditions and comparable occupancy rates for similar buildings in the same area.
The discount rate is related to the current yield on long-term government bonds plus a risk premium to reflect the additional risk of investing in the subject properties. Management adopt a valuation report produced by an independent valuer that determines the discount based on the independent valuers judgement after considering current market rates.
The comparable recent sales represent the recent sales prices of properties that are similar to the Group's properties, which are in the same area. Management adopt a valuation report produced by an independent valuer to determine the value per square meter based on the average recent sales prices.
The EBITDA multiple represents the amount that market participants would use when pricing investments. The EBITDA multiple is selected from comparable public companies with similar business as the underlying investment. Management obtains the average EBITDA multiple from the comparable companies and applies the multiple to the EBITDA of the underlying investment. The amount is further discounted for considerations such as lack of marketability.
The discount for lack of marketability represents the discount applied to the comparable market multiples to reflect the illiquidity of the investee relative to the comparable peer group. Management determines the discount for lack of marketability based on its judgement after considering market liquidity conditions and company-specific factors.
Where an EBITDA multiple is not available, the net tangible assets may be used as a proxy for fair value of an underlying investment. In such instances, a discount to certain tangible assets, including inventory, trade receivables and fixed assets are taken for lack of liquidity to arrive at an adjusted net tangible asset value.
Price of recent transaction is not disclosed due to strategic concerns.
The revenue growth represents the growth in sales of the underlying business and is based on the operating management team's judgement on the change of various revenue drivers related to the business from year-to-year. The expense ratio is based on the judgement of the operating management team after evaluating the expense ratio of comparable businesses and is a key component in deriving EBITDA and free cash flow for the greenfield business. The free cashflow is discounted at the weighted average cost of capital to derive the enterprise value of the greenfield business. Net debt is then deducted to arrive at an equity value for the business. Weighted cost of capital is derived after adopting independent market quotes or reputable published research-based inputs for the risk-free rate, market risk premium, small cap premium and cost of debt.
The investment entity approach requires the presentation and fair value measurement of immediate investments; the shares of intermediate holding companies are not listed. However, ultimate investments in listed entities amounting to US$282,494,000 ( 2018 : US$ 268,832,000 ) are held through intermediate holding companies; the value of these companies are mainly determined by the fair values of the ultimate investments.
Level 3 valuations
The following table shows a reconciliation from the beginning balances to the ending balances for fair value measurements in Level 3 of the fair value hierarchy.
|
|
2019 |
2018 |
|
|
Financial assets at fair value through profit or loss |
|
|
|
US$'000 |
US$'000 |
|
|
|
|
|
Balance at 1 January |
486,790 |
608,456 |
|
Fair value changes in profit or loss |
43,533 |
(79,234) |
|
Net payment to/(repayment from) unconsolidated subsidiaries |
39,547 |
(42,443) |
|
Disposal |
(531) |
11 |
|
Balance at 31 December |
569,339 |
486,790 |
Sensitivity analysis
Although the Company believes that its estimates of fair value are appropriate, the use of different methodologies or assumptions could lead to different measurements of fair value. For fair value measurements in Level 3 assets, changing one or more of the assumptions used to reasonably possible alternative assumptions would have the following effects on the profit or loss:
|
|
‹----- 31 December 2019 -----› |
‹----- 31 December 2018 -----› |
||
|
|
Effect on profit or loss |
Effect on profit or loss |
||
|
|
Favourable |
(Unfavourable) |
Favourable |
(Unfavourable) |
|
|
US$'000 |
US$'000 |
US$'000 |
US$'000 |
|
|
|
|
|
|
|
Level 3 assets |
38,607 |
(41,458) |
36,341 |
(32,752) |
The favourable and unfavourable effects of using reasonably possible alternative assumptions have been calculated by recalibrating the valuation model using a range of different values.
For rental properties, the projected rental rates and occupancy levels were increased by 5% for the favourable scenario and reduced by 5% for the unfavourable scenario. The discount rate used to calculate the present value of future cash flows was also decreased by 1% for the favourable case and increased by 1% for the unfavourable case compared to the discount rate used in the year-end valuation.
For land related investments (except those held for less than 12-months where cost approximates fair value), which are valued on comparable transaction basis by third party valuation consultants, the fair value of the land is increased by 15% in the favourable scenario and reduced by 15% in the unfavourable scenario.
For operating businesses (except those where a last transacted price exists within the past 12-months that provides the basis for fair value) that are valued on a trading comparable basis using enterprise value to earnings before interest, tax, depreciation and amortisation ("EBITDA"), EBITDA is increased by 15% and decreased by 15% in the favourable and unfavourable scenarios. Similarly, where adjusted net tangible assets are used, the value is increased by 15% and decreased by 15% in the favourable and unfavourable scenarios.
For greenfield businesses (except those where a last transacted price exists within the past 12-months) that are valued using a discounted cashflow, the revenue growth rate is increased by 1%, the expense ratio rate is decreased by 5% and the WACC is reduced by 1% in the favourable scenario. Conversely, in the unfavourable scenario, the revenue growth rate is reduced by 1%, the expense ratio rate is increased by 5% and the WACC is increased by 1%.
11 Earnings per share
|
|
|
2019 |
2018 |
|
|
|
US$'000 |
US$'000 |
|
Basic and diluted earnings per share are based on: |
|
|
|
|
P rofit/(loss) for the year attributable to equity holders of the Company |
|
28,912 |
(69,516) |
Basic and diluted earnings per share
|
|
|
Number of shares 2019 |
Number of shares 2018 |
|
|
|
|
|
|
Issued ordinary shares at 1 January |
|
513,366,198 |
488,221,592 |
|
Shares issued |
|
- |
25,144,606 |
|
Issued ordinary shares at 31 December |
|
513,366,198 |
513,366,198 |
|
|
|
|
|
|
Weighted average number of shares (basic and diluted) |
|
513,366,198 |
496,728,851 |
12 Operating segments
The Company has investment segments, as described below. Investment segments are reported to the Board of Directors of Symphony Asia Holdings Pte. Ltd., the Investment Manager, who review this information on a regular basis.
For the year ending 31 December 2019, the Company has revised its reportable segments. The following summarises the changes made to the reporting business segments:
a. The segment formerly described as 'Lifestyle/education' has been split into separate segments as 'Lifestyle' and 'Education'.
b. Following a review by management, certain investments that were previously included under the 'Cash and temporary investments' have been separated into a new 'Other' category, which now also includes special situations type investments.
c. A new segment, 'Logistics' has been created which includes the Company's new investment in Indo Trans Logistics Corporation (ITL).
The change in segment reporting has no impact on the net profit or loss of the Company. To enable comparisons with prior period performance and position, segment information for the year ended 31 December 2018 has been restated.
Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis.
Business activities which do not meet the definition of an operating segment have been reported in the reconciliations of total reportable segment amounts to the financial statements.
The following summary describes the investments in each of the Company's reportable segments.
|
|
|
|
Healthcare |
Includes an investment in IHH Healthcare Bhd (IHH), ASG Hospital Private Limited (ASG) and Soothe Healthcare Private Limited (Soothe) |
|
|
|
|
Hospitality |
Includes investment in Minor International Public Company Limited (MINT) |
|
|
|
|
Lifestyle |
Includes investments in Chanintr Living Ltd. (Chanintr), the Wine Connection Group (WCG) and Liaigre Group (Liaigre) |
|
|
|
|
Lifestyle/Real Estate |
Includes investments in Minuet Ltd, SG Land Co. Ltd., a property joint venture in Niseko, Hokkaido, Japan and Desaru Peace Holdings Sdn Bhd |
|
|
|
|
Education |
Includes WCIB International Co. Ltd. (WCIB) and Creative Technology Solutions DMCC (CTS) |
|
|
|
|
Logistics |
Indo Trans Logistics Corporation |
|
|
|
|
Other |
Includes Smarten Spaces Pte. Ltd. ("Smarten"), Good Capital Partners and Good Capital Fund I (collectively, Good Capital), structured investments and a global listed portfolio |
|
|
|
|
Cash and temporary investments |
Includes government securities or other investment grade securities, liquid investments which are managed by third party investment managers of international repute, and deposits placed with commercial banks |
|
|
|
Information on reportable segments
|
|
Healthcare |
Hospitality |
Education |
Lifestyle |
Lifestyle/ real estate |
Logistics |
Cash and temporary investments |
Others |
Total |
|
|
US$'000 |
US$'000 |
US$'000 |
US$'000 |
US$'000 |
US$'000 |
US$'000 |
US$'000 |
US$'000 |
|
31 December 2019 |
|
|
|
|
|
|
|
|
|
|
Investment income |
|
|
|
|
|
|
|
|
|
|
- Dividend income |
- |
- |
- |
- |
- |
- |
231 |
- |
231 |
|
- Interest income |
- |
- |
- |
- |
24 |
378 |
151 |
- |
553 |
|
- Fair value changes of financial assets at fair value through profit or loss |
219 |
42,018 |
5,770 |
(22,232) |
17,396 |
(281) |
(152) |
795 |
43,533 |
|
|
219 |
42,018 |
5,770 |
(22,232) |
17,420 |
97 |
230 |
795 |
44,317 |
|
Investment expenses - Exchange loss, net |
95 |
* |
1 |
(1,058) |
411 |
* |
16 |
1 |
(534) |
|
|
95 |
* |
1 |
(1,058) |
411 |
* |
16 |
1 |
(534) |
|
|
|
|
|
|
|
|
|
|
|
|
Net investment results |
314 |
42,018 |
5,771 |
(23,290) |
17,831 |
97 |
246 |
796 |
43,783 |
|
|
|
|
|
|
|
|
|
|
|
|
31 December 2018 (restated) |
|
|
|
|
|
|
|
|
|
|
Investment income |
|
|
|
|
|
|
|
|
|
|
- Dividend income |
- |
25,841 |
- |
- |
- |
- |
- |
- |
25,841 |
|
- Interest income |
- |
- |
- |
- |
24 |
- |
277 |
- |
301 |
|
|
- |
25,841 |
- |
- |
24 |
- |
277 |
- |
26,142 |
|
Investment expenses - Exchange loss, net |
186 |
* |
* |
(2,447) |
(483) |
- |
(41) |
* |
(2,785) |
|
- Loss on disposal of financial assets at fair value through profit or loss |
- |
- |
- |
- |
- |
- |
(19) |
- |
(19) |
|
- Fair value changes of financial assets at fair value through profit or loss |
410 |
(94,793) |
(488) |
10,022 |
5,899 |
- |
(32) |
(252) |
(79,234) |
|
|
596 |
(94,793) |
(488) |
7,575 |
5,416 |
- |
(92) |
(252) |
(82,038) |
|
|
|
|
|
|
|
|
|
|
|
|
Net investment results |
596 |
(68,952) |
(488) |
7,575 |
5,440 |
- |
185 |
(252) |
(55,896) |
|
|
|
|
|
|
|
|
|
|
|
|
31 December 2019 |
|
|
|
|
|
|
|
|
|
|
Segment assets |
28,301 |
278,019 |
25,086 |
33,415 |
145,848 |
42,641 |
7,681 |
16,019 |
577,010 |
|
|
|
|
|
|
|
|
|
|
|
|
Segment liabilities |
- |
- |
- |
- |
5,428 |
- |
67,451 |
- |
72,879 |
|
|
|
|
|
|
|
|
|
|
|
|
31 December 2018 (restated) |
|
|
|
|
|
|
|
|
|
|
Segment assets |
11,399 |
257,951 |
16,042 |
68,609 |
118,191 |
- |
11,694 |
14,442 |
498,328 |
|
|
|
|
|
|
|
|
|
|
|
|
Segment liabilities |
- |
- |
- |
|
5,327 |
- |
- |
- |
5,327 |
* Less than US$1,000
The reportable operating segments derive their revenue primarily by achieving returns, consisting of dividend income, interest income and appreciation in fair value. The Company does not monitor the performance of the investments by measure of profit or loss.
Reconciliations of reportable segment profit or loss and assets
|
|
|
31 December 2019 |
31 December 2018 |
|
|
|
US$'000 |
US$'000 |
|
|
|
|
Restated |
|
Profit or loss |
|
|
|
|
Net investments results |
|
42,987 |
(55,644) |
|
Net investment results for other segments |
|
796 |
(252) |
|
Unallocated amounts: |
|
|
|
|
- Management fees |
|
(11,839) |
(12,248) |
|
- Non-executive director remuneration |
|
(384) |
(386) |
|
- Other corporate expenses |
|
(2,648) |
(986) |
|
Profit/ ( l oss) for the year |
|
28,912 |
(69,516) |
|
|
|
|
|
|
Assets |
|
|
|
|
Total assets for reportable segments |
|
560,991 |
483,886 |
|
Assets for other segments |
|
16,019 |
14,442 |
|
Other assets |
|
69 |
72 |
|
Total assets |
|
577,079 |
498,400 |
|
|
|
|
|
|
Liabilities |
|
|
|
|
Total liabilities for reportable segments |
|
72,879 |
5,327 |
|
Other payables |
|
551 |
368 |
|
Bank overdraft |
|
- |
* |
|
Total liabilities |
|
73,430 |
5,695 |
13 Significant related party transactions
For the purposes of these condensed financial statements, parties are considered to be related to the Company if the Company has the ability, directly or indirectly, to control the party or exercise significant influence over the party in making financial and operating decisions, or vice versa, or where the Company and the party are subject to common control or common significant influence. Related parties may be individuals or entities.
Dividend income
During the financial year ended 31 December 2019 , the Company recognised dividend income from its unconsolidated subsidiaries amounting to US$231,000 ( 2018 : US$ 25,841,000 ).
Key management personnel compensation
Key management personnel of the Company are those persons having the authority and responsibility for planning, directing and controlling the activities of the Company.
During the financial year, directors' fees amounting to US$384,000 ( 2018 : US$ 386,000 ) were declared as payable to five directors ( 2018 : four directors) of the Company. The remaining two directors of the Company are also directors of the Investment Manager who provides management and administrative services to the Company on an exclusive and discretionary basis. No remuneration has been paid to these directors as the cost of their services form part of the Investment Manager's remuneration.
Other related party transactions
During the financial year ended 31 December 2019 , the Company recognised interest income from its unconsolidated subsidiaries totalling US$402,000 (31 December 2018 : US$ 24,000 ).
Pursuant to the Investment Management Agreement, the Investment Manager will provide investment management and advisory services exclusively to the Company. Details of the remuneration of the Investment Manager are disclosed in the financial statements as at and for the year ended 31 December 2018 . During the financial year ended 31 December 2019 , management fee amounting to US$11,839,000 (31 December 2018 : US$ 12,248,000 ) paid/payable to the Investment Manager has been recognised in the condensed financial statements.
Pursuant to the Investment Management Agreement and on 3 August 2008 , the Company granted 82,782,691 share options to subscribe for ordinary shares with an exercise price of US$1.00 to the Investment Manager, which had been previously deferred. These share options fully vested in five tranches over a period of five years and were exercisable on or before 2 August 2018 and lapsed unexercised. These lapsed options cannot be reissued to the Investment Manager.
On 22 October 2012 and pursuant to the Investment Management Agreement, the Company granted to the Investment Manager 41,666,500 share options to subscribe for ordinary shares with an exercise price of US$0.60 that have fully vested in five equal tranches over a period of five years and which have an expiration on the tenth anniversary of the date of grant. The Investment Manager exercised share options amounting to 4,054,970, 4,278,330, 4,538,197, 742,616, 621,902 , 2,285,879 , 2,514,465 and 22,630,141 on 5 May 2014, 10 June 2014, 14 April 2015, 28 June 2016, 26 June 2017 , 3 November 2017 , 20 June 2018 and 23 August 2018 , respectively, at the exercise price of US$0.60 per share. There were no share options outstanding as at 31 December 2019.
As at 31 December 2019 and 31 December 2018 , the Investment Manager had not been issued any management shares.
Other than as disclosed elsewhere in the condensed unaudited financial statements, there were no other significant related party transactions during the years ended 31 December
2019
and
31 December
2018
.
14 Commitments
In September 2008, the Company entered into a loan agreement with a joint venture, held via its unconsolidated subsidiary, to grant loans totaling US$4,700,000 (THB140,000,000). As at
31 December 2019
, US$4,000,000 (THB120,000,000) (
2018
: US$
3,700,000
(THB
120,000,000)
) has been drawn down. The Company is committed to grant the remaining loan amounting to US$673,000 (THB20,000,000) (2018: US$619,000 (THB20,000,000)), subject to terms set out in the agreement.
Symphony entered into agreements in September 2019 for an investment in ASG Hospital Private Limited ("ASG"). As part of the agreement, Symphony will subscribe to a second tranche of securities in ASG during the 2020 financial year at a cost of less than 1% of NAV.
In November 2019, Symphony entered to agreements to subscribe to shares in Smarten Spaces Pte. Ltd. ("Smarten") As part of the agreements, Symphony will subscribe to a second tranche of shares in Smarten during the 2020 financial year at a cost of less than 1% of NAV.
Symphony has a committed to subscribe to Good Capital Fund I for an amount less than 1% of NAV. Approximately 40% of this commitment had been funded at 31 December 2019 with 60% of the commitment subject to be called.
In the general interests of the Company and its unconsolidated subsidiaries, it is the Company's current policy to provide such financial and other support to its group of companies to enable them to continue to trade and to meet liabilities as they fall due.
15 Subsequent events
In January 2020, Symphony fully exited its investment in IHH Healthcare Berhad with the sale of 3.5 million shares that generated net proceeds of US$4.6 million.
As at 6 March 2020, Symphony sold approximately 12.5 million shares of MINT that generated proceeds of approximately US$11.4 million.
IMPORTANT INFORMATION
This document is not for release, publication or distribution, in whole or in part, directly or indirectly, in or into the United States or any other jurisdiction into which the publication or distribution would be unlawful. These materials do not constitute an offer to sell or issue or the solicitation of an offer to buy or acquire securities in the United States or any other jurisdiction in which such offer or solicitation would be unlawful. THE securities referred to in this document have not been and will not be registered under the securities laws of such jurisdictions and may not be sold, resold, taken up, transferred, delivered or distributed, directly or indirectly, within such jurisdictions.
No representation or warranty is made by the Company or its Investment Manager as to the accuracy or completeness of the information contained in this document and no liability will be accepted for any loss whatsoever arising in connection with such information.
This Document contains (or may contain) certain forward-looking statements with respect to certain of the Company's current expectations and projections about future events. These statements, which sometimes use words such as "anticipate", "believe", "could", "estimate", "expect", "intend", "may", "plan", "potential", "should", "will" and "would" or the negative of those terms or other comparable terminology, are based on the Company's beliefs, assumptions and expectations of its future performance, taking into account all information currently available to it at the date of this document. These beliefs, assumptions and expectations can change as a result of many possible events or factors, not all of which are known to the Company at the date of this announcement or are within its control. If a change occurs, the Company's business, financial condition and results of operations may vary materially from those expressed in its forward-looking statements. Neither the Company nor its Investment Manager undertake to update any such forward looking statements
Statements contained in this DOCUMENT regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. The information contained in this document is subject to change without notice and, except as required by applicable law, neither the Company nor THE INVESTMENT MANAGER assumes any responsibility or obligation to update publicly or review any of the forward-looking statements contained herein. You should not place undue reliance on forward-looking statements, which speak only as of the date of this announcement.
This document is for information purposes only and does not constitute an invitation or offer to underwrite, subscribe for or otherwise acquire or dispose of any securities of the Company in any jurisdiction. All investments are subject to risk. Past performance is no guarantee of future returns. Shareholders and prospective investors are advised to seek expert legal, financial, tax and other professional advice before making any investment decisions.
This DOCUMENT is not an offer of securities for sale into the United States. The Company's securities have not been, and will not be, registered under the United States Securities Act of 1933 and may not be offered or sold in the United States absent registration or an exemption from registration. There will be no public offer of securities in the United States .
Neither the content of the Company's website (or any other website) nor the content of any website accessible from hyperlinks on the Company's website (or any other website) is incorporated into, or forms part of, this DOCUMENT.
The Company and the Investment Manager are not associated or affiliated with any other fund managers whose names include "Symphony", including, without limitation, Symphony Financial Partners Co., Ltd.
End of Announcement
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
COMPANIES COVERED:
Latest directors dealings
- 1 hour ago Rathbones Group
- 1 hour ago Quartix Technologies
- 2 hours ago C&C Group (CDI)
- 2 hours ago Aquila Energy Efficiency Trust (EUR)
- 3 hours ago Cranswick