Crushmetric Group Ld: Interim results for six months ended 30 June 2023
02/10/2023 07:00
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RNS Number : 2145O CRUSHMETRIC Group Limited 02 October 2023
2 October 2023
CRUSHMETRIC Group Limited
("CRUSHMETRIC", the "Group" or the "Company")
Interim results for the six months ended 30 June 2023
Chief Executive Officer's Statement
CRUSHMETRIC Group Limited (AQUIS: CUSH), the consumer design and production
group announces the results of the Company and its subsidiaries for the six
month period ended 30 June 2023.
The Company was formerly engaged in TCM healthcare, as well as the production
and sale of skincare products. The board took the view that the Company
would have to change focus in the light of the Covid pandemic. Thus during
2022, the nature of the Company's operations and its principal activities were
changed to acting as the holding company of a group engaged in (i) design and
production that integrates shape changing technology ("CRUSH") into a
catalogue of products designed and invented by the artist and co-founder of
CRUSHMETRIC Limited, Noah Deledda, and his team. This technology is built on
his own series of dented aluminium can sculptures and (ii) the sale and
distribution of the CRUSHMETRIC products through online and offline channels
worldwide.
This announcement contains inside information as defined in Article 7 of the
Market Abuse Regulation No. 596/2014 and is disclosed in accordance with the
Company's obligations under Article 17 of those Regulations.
Financial highlights
· Revenue for the six months ended 30 June 2023: HK$1,040,509 (30 June
2022: HK$7,969,835)
· Gross profit for the six months ended 30 June 2023: HK$728,143 (30 June
2022: HK$3,781,756)
· Loss for the six months ended 30 June 2023: HK$3,813,095 (30 June 2022:
HK$908,874)
· The basic and diluted loss per share for the six months ended 30 June 2023:
HK$0.02 (30 June 2022: HK$0.01)
· The Group's cash position as at 30 June 2023: HK$1,450,559 (30 June 2022:
HK$333,150)
Review of significant activities
(a) CONVERTIBLE BONDS
(i) Renewal of Convertible Bond 1: Principal Amount USD650,000
On 29 June 2023, the Group entered into an extension agreement for the
Convertible Bond. The maturity date has been extended to 19 July 2024 and the
Coupon payment of the CB will be adjusted to six percent (6%) per annum
payable in cash plus three percent (3%) per annum payable in Ordinary Shares
of the Group for the first nine months from 20 January 2023 to 19 October 2023
and the Coupon payment of the CB will be six percent (6%) per annum payable in
cash plus four percent (4%) per annum payable in Ordinary Shares of the Group
for the period from 20 October 2023 to 19 July 2024. All other terms remain
unchanged.
(ii) Convertible Bond 2: Principal Amount SGD250,000
On 24 February 2023, the Group entered into an agreement to issue an unsecured
convertible bond ("the Bond") to Future Vision Pte. Ltd ("Future"). Future has
agreed to subscribe in cash for the Bond for a principal amount of SGD$250,000
(approximately £150,820). The Bond has a coupon of ten percent (10%) per
annum.
The Bond, at the election of Future may be converted into ordinary shares of
the Group ("Underlying shares") or will otherwise be redeemable at maturity on
23(rd) February 2026. The Bond shall be convertible into the Underlying Shares
at an Exchange Price which is calculated at a GBP 0.2 per share where 50% of
the Bond can be converted within the first year and the rest can be converted
on the Maturity Date at the discretion of Future.
(iii) Convertible Bond 3: Principal Amount USD1,000,000
On 11 April 2023, the Group entered into an agreement with Sky Solar HK
Investments Limited ("Sky") to issue an unsecured convertible bond ("the
Bond") to Sky. Sky agreed to subscribe in cash for the Bond for a principal
amount of USD$1,000,000 (approximately £790,400). The bond has a coupon of
ten percent (10%) per annum.
The Bond, at the election of Sky, may be converted into ordinary shares of the
Group ("Underlying shares") or will otherwise be redeemable three years from
the date of receipt of the Principal Amount. The Bond shall be convertible
into the Underlying Shares at an Exchange Price which is calculated at a GBP
0.2 per share where 50% of the Bond can be converted within the first year,
25% of the Bond can be converted in the second year and the rest of 25% can be
converted on the Maturity Date at the discretion of Sky.
(b) CHANGE OF WORKING ADDRESS
On 23 April 2023, one of the Group's subsidiaries, CRUSHMETRIC eCommerce (HK)
Limited entered into a tenancy agreement for a fixed term of two years for a
new office located in Hong Kong from which the Group will henceforth carry on
its business.
Financial review
(i) Income statement items
The Group's revenue for the six months ended 30 June 2023 amounted to
HK$1,040,509, a decrease of HK$6,929,326 or 86.94% as compared to the six
months ended 30 June 2022. This was attributable to decreased revenue
generated from sales of CRUSHMETRIC SwitchPens by approximately HK$5,626,000.
The Group's gross profits and gross profit margin for the six months ended 30
June 2023 amounted to HK$728,143 and 69.98% (30 June 2022: HK$3,781,756 and
47.45%) respectively.
The Group's distribution costs for the six months ended 30 June 2023 amounted
to HK$111,552, a decrease of HK$102,640 or 47.92% as compared to the same
period in 2022. The Group's administrative expenses for the six months ended
30 June 2023 amounted to HK$4,224,302, a decrease of HK$320,487 or 8.21% as
compared to the six months ended 30 June 2022.
The Finance Costs for the six months ended 30 June 2023 amounted to
HK$502,141, this was related to the interest expenses for the convertible
bond.
The unaudited net loss for the period ended 30 June 2023 shows an increase of
HK$2,904,221 and 319.54% compared to the same period in 2022. This was
attributable to the decrease of sales and increase of administrative expenses
by the Group during the period.
The Directors do not recommend the payment of a dividend in respect of the
period.
The interim results have not been reviewed by the Company's auditor.
(ii) Balance sheet items
The Group's tangible fixed assets mainly comprised office equipment, decreased
in amount by HK$144,031 as at 30 June 2023, compared to the same period in
2022, mainly due to the depreciation in value of office equipment.
The Group's inventories as at 30 June 2023 amounted to HK$317,424 with a
decrease of HK$78,084 over the balance as at 30 June 2022.
The Group's other receivables and prepayments as at 30 June 2022 decreased by
HK$149,971 or 7.17% compared to the same period in 2021.
The Group's trade payables as at 30 June 2023 amounted to HK$3,502,655 with a
decrease of HK$4,846,272 over the balance as at 30 June 2022, this was mainly
due to the acquisition of a vendor in December 2022.
The Group's cash and cash equivalents increased by HK$1,117,409 as at 30 June
2023 compared to 30 June 2022.
Outlook
The Company has transformed its business to a consumer product Group that is
focused on selling various innovative products to the market.
We've faced a decrease in sales in the first half years as the Company has
dedicated more resources for new product research and preparation. We took
some time in searching for social media and marketing partners better suited
to the marketing and distribution online, of the CRUSHMETRIC series of
products through both our own website as well as Amazon and other marketing
partners. We believe these partnerships will help the Company reach out to a
more targeted audience and customers that will result in increased revenue in
the second half of the coming year.
The launch of our new product - the Tumbler, was delayed but we are confident
that it will be launched by the end of the year and we expect this to result
improved sales and better returns. The Group will continue to focus on
promoting and generating more sales from the CRUSHMETRIC series of products
which we have launched; together with the Tumbler to be launched soon.
The Board will continue to take all reasonable efforts to ensure that
sufficient working capital is maintained. The Board's objective is the same as
previous years, which is to protect and safeguard as well as improve the
business, to minimise cost and generate more sales income through online
products.
On behalf of the Board of Directors, I would like to thank our management and
staff for the great loyalty and dedication they continue to show through these
delicate times. I would also like to extend our utmost appreciation to all our
partners, shareholders, customers, business associates and suppliers, for
their continued support.
The Directors of the Company accept responsibility for the contents of this
announcement.
Ivor Colin Shrago
Chairman
For further information, please contact:-
CRUSHMETRIC Group Limited Tel: +852 2110 4221
ONG Ban Poh Michael - Chief Executive Officer
Lilian Lo - Acting Chief Financial Officer
Aquis Growth Market Corporate Adviser Tel: +44 (0)20 7469 0930
PETERHOUSE CAPITAL LIMITED
Guy Miller
Mark Anwyl
CRUSHMETRIC Group Limited
Consolidated Statement of Comprehensive Income
For the six months ended 30 June 2023
The Group
Unaudited Unaudited Audited
6 months ended 30 June 2023 6 months ended 30 June 2022 Year ended 31 December 2022
HK$ HK$ HK$
From continuing operations
Revenue 1,040,509 7,969,835 10,826,825
Cost of sales (312,366) (4,188,079) (6,422,471)
Impairment loss on inventory - - -,
Gross profit 728,143 3,781,756 4,404,354
Other revenue 679,246 125,108 1,646,139
Distribution costs (111,552) (214,192) (393,306)
Administrative expenses (4,224,302) (3,903,815) (11,049,827)
Foreign exchange gains/(losses), net (386,192) (117,317) (266,084)
Operating loss (3,314,657) (328,460) (5,658,724)
Impairment loss on trade receivable - (24,830) (45,759)
Finance costs (502,141) (555,945) (86,398)
Interest income 3,703 361 433
Loss before taxation (3,813,095) (908,874) (5,790,448)
Taxation - - (57,594)
Loss for the period/year (3,813,095) (908,874) (5,848,042)
Other comprehensive income
Exchange differences arising from translation 485,461 550,758 1,010,343
Total comprehensive result for the period/year (3,327,634) (358,116)
(4,837,699)
Loss for the period/year attributable to:
Equity holders of the parent entity (3,913,831) (904,339) (5,595,532)
Non-controlling interests 100,736 (4,535) (252,510)
(3,813,095) (908,874) (5,848,042)
Total comprehensive loss for the period/year attributable to:
Equity holders of the parent entity (3,428,370) (353,581) (4,585,189)
Non-controlling interests 100,736 (4,535) (252,510)
(3,327,634) (358,116) (4,837,699)
Loss per share - from continuing operations (HK$)
Basic and diluted (0.02) (0.01) (0.06)
Loss per share - from continuing operations
The calculation of basic loss per share is based on the consolidated loss
attributable to the equity holders of the parent entity of HK$3,913,831 (For
the six months ended 30 June 2022: Loss of HK$904,339; For the 12 months ended
31 December 2022: Loss of HK$5,595,532) and the weighted average number of
ordinary shares of 239,933,283 (For the six months ended 30 June 2022 weighted
average number of ordinary shares of 85,606,051; For the 12 months ended 31
December 2022: 89,655,922) in issue during the period.
CRUSHMETRIC Group Limited
Consolidated Statement of Financial Position
As at 30 June 2023
Unaudited Unaudited Audited
As at 30 June 2023 As at 30 June 2022 As at 31
December
2022
HK$ HK$ HK$
Assets
Non-current assets
Fixed assets 185,391 41,360 221,258
Other intangible assets - 2,678,572 -
Right-of-use assets 199,389 266,793 370,640
Goodwill 293,993,592 - 293,993,592
294,378,372 2,986,725 294,585,490
Current assets
Inventories 317,424 395,508 341,561
Trade receivables 904,977 2,051,407 757,271
Other receivables and prepayments 1,197,284 1,940,336 1,162,149
Cash and cash equivalents 1,450,559 333,150 128,658
3,870,244 4,720,401 2,389,639
Total assets 298,248,616 7,707,126 296,975,129
Equity and liabilities
Equity
Share capital 1,870,234 668,509 1,870,234
Share premium 392,450,040 97,084,716 392,450,040
Reserve (144,997,379) (137,337,401) (141,569,009)
Equity attributable to the parent entity 249,322,895 (39,584,176) 252,751,265
Non-controlling interest (440,910) (293,671) (541,646)
Total equity 248,881,985 (39,877,847) 252,209,619
Liabilities
Current liabilities
Trade payables 3,502,655 8,348,927 4,319,057
Other payables and accruals 28,174,956 29,911,001 31,961,020
Taxation payable 57,594 - 57,594
Amount due to directors 2,927,984 3,448,023 2,930,515
Lease liabilities 204,648 453,305 275,620
Borrowings 14,498,794 5,423,717 5,106,144
49,366,631 47,584,973 44,649,950
Non-Current liabilities
Lease liabilities - - 115,560
Total liabilities 49,366,631 47,584,973 44,765,510
Total equity and liabilities 298,248,616 7,707,126 296,975,129
The Group's consolidated financial statements for the six months ended 30 June
2022 and 2023 disclosed above have neither been audited nor reviewed by the
Company's auditors.
The same accounting policies and methods of computation as included in the
Group's consolidated financial statements for the year ended 31 December 2022
have been adopted in the preparation of the Group's unaudited consolidated
financial statements for the six months ended 30 June 2023.
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