REG - Jade Road Investmnts - INTERIM RESULTS FOR SIX MONTHS ENDED 30 JUNE 2023
29/09/2023 07:00
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RNS Number : 1453O Jade Road Investments Limited 29 September 2023
29 September 2023
JADE ROAD INVESTMENTS LIMITED
("Jade Road Investments", "JADE", the "Company" or the "Group")
INTERIM CONSOLIDATED RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2023
Jade Road Investments Limited (AIM: JADE), the London quoted pan-Asian
diversified investment vehicle focused on providing shareholders with
attractive uncorrelated, risk-adjusted long-term returns, is pleased to
announce its interim results for the six months ended 30 June 2023.
Financial Highlights:
· Total income decreased to US$0.59 million and was derived from interest
income as dividend income from investees, as opposed to interest income from
Jade's own cash (H1 2022: US$1.56 million).
· Net loss of $ 1.4 million (H1 2022: US$ 1.02 million profit).
· Consolidated basic / diluted loss per share of US$ 0.75 cents (H1 2022:
profit per share US$ 0.88 cents).
· Consolidated NAV at 30 June 2023 increased by 3% to US$ 15.46
million/GBP 12.69 million (31 December 2022: US$15.13 million/GBP 12.4
million).
· NAV per share at 30 June 2023 US$ 0.05 (GBP 0.04) (31 December 2022:
US$0.13 / GBP 0.11 ).
· Period end cash position of US$ 0.1 million (31 December 2022 : US$ 0.3
million).
Investment and Operational Highlights:
· Future Metal Holdings Limited ("Future Metal")
o Pursuant to its latest Investment Policy, the Company has been actively
seeking divestment opportunities for this asset.
o In August 2023, the Quarry successfully renewed its mining licence for
another two years, which extended the validity period to August 2025. As the
Quarry's mining zone covers secondary forestland for public welfare and
farming land, the mining zone is narrowed down from 2.3 square kilometres to
1.7 square kilometres. However, the mineral reserves of the Quarry have not
been negatively impacted.
o As of the release of this interim report, the Company is finalising the
share purchase agreement and other transaction documents with the local buyer.
· Meize Energy Industries Holdings Limited ("Meize")
o The Company is seeking a full divestment concerning the remaining Series B
preferred shares it holds after the successful completion of the partial
divestment in August 2022
o As of Q2 2023, as customer contracts were secured, Meize's Xinjiang Plant
produced 840 wind turbines and its Inner Mongolia Plant produced 360 wind
turbines.
o Based on Meize's management team's estimation, the total output value of
Meize would amount to USD21.0MM by the end of 2023.
· DocDoc Pte Ltd ("DocDoc")
o DocDoc is an asset-light and intellectual property-heavy pan-Asian
insurance fintech company.
o DocDoc's management team aims to generate SGD5MM from gross insurance
premiums in Singapore by the end of 2023, which would be first revenues for
the business.
· Outlook:
o Future investments will be made in asset backed income-generating
investments as the Company disposes of all of its legacy Asia-based assets and
your Board hopes to be able to make further announcements on this in the near
future.
FOR FURTHER INFORMATION, PLEASE CONTACT:
Jade Road Investments Limited +44 (0) 778 531 5588
John Croft
WH Ireland Limited - Nominated Adviser +44 (0) 20 7220 1666
James Joyce
Andrew de Andrade
Hybridan LLP - Corporate Broker +44 (0) 203 764 2341
Claire Noyce
Lionsgate Communications - Communications Adviser +44 (0) 779 189 2509
Jonathan Charles
About Jade Road Investments
Jade Road Investments Limited is quoted on the AIM Market of the London Stock
Exchange and is committed to providing shareholders with attractive
uncorrelated, risk-adjusted long-term returns from a combination of realising
sustainable capital growth and delivering dividend income.
The Company is focused on asset-backed and revenue-generating investment
opportunities which will provide more certainty when predicting future cash
flow. This allows the Company to plan an appropriate dividend policy in due
course. It is believed that this will allow for the optimal delivery of
shareholder value in the form of the payment of a safe, consistent dividend
yield at an attractive spread to other yielding options, while growing the
underlying capital base of the Company.
The Company's investment manager, Harmony Global Partners Limited ("Harmony
Capital"), will advise the Board and the Company on the orderly disposal of
the legacy portfolios and advise on any proposed new investments to be made in
accordance with the Company's new Investment Policy recently approved by
shareholders.
Harmony Capital shall, subject to the overall supervision and control of the
Board, also undertake general administrative, investor relations, marketing,
portfolio management and risk management functions for the Company.
Chairman's Statement
As mentioned in my statement in our 2022 Annual Results, 2023 is a year of
ongoing transition for the Company as it moves away from its previous focus on
Asia to a more geographically diverse investment strategy characterised by
investing in a portfolio of high yielding assets with a low correlation to
most markets or major asset classes.
In February of this year, the Company announced the completion of an equity
fundraise which was underwritten in its entirety by Heirloom Investment
Management LLC ("HIM"). The gross placing amount for this fundraise was
$1,750,000.
In line with its new amended investment strategy, the Company then announced
in April that it had invested USD500,000 in Heirloom Investment Fund SPC -
Heirloom Fixed Return Fund SP, managed by HIM.
The new fund is geographically diverse with low correlation to most markets or
major asset classes, such as equities, fixed income and real estate. Current
themes include asset-backed lending, equipment leasing, agriculture (farm
business), niche real estate (US single family rental), infrastructure,
litigation finance and music royalties.
An important element of transitioning the Company away from its previous Asian
focus is to actively seek buyers for its legacy assets. In order to support
this, the remuneration fee structure for the Company's Investment Manager
Harmony Capital has been changed to comprise of a sharply reduced fixed annual
management fee of US$350k, alongside an incentive fee structure for asset
disposals. Incentive fees in this regard are only payable after a minimum net
sales value of US$6m has been reached.
Progress on asset disposals has inevitably been slow, given their common
characteristics of being essentially private equity in nature. However, the
Investment Management team have been working closely with all our major assets
with a view to finding suitable exits, and I am hopeful that announcements on
some core asset disposals can be made during this year.
An equity fundraise of $1,050,000 was also completed in September 2023 with
new shares placed at a significant premium to the Company's then share price.
Finally, on behalf of the board, I would like to extend my thanks to all of
our shareholders for your continued support.
The principal assets as of 30 June 2023 are detailed below:
Principal assets Effective interest % Instrument type Valuation at 31 December 2022 Credit income US$ million Cash receipts Equity investment/ other movement US$ million Fair value adjustment US$ million Provision Valuation at 30 June 2023
US$ million US$ million US$ million US$ million
Future Metal Holdings Limited 84.8 Structured Equity 5.3 0.3 - - - 5.3
(0.3)
Meize Energy Industrial Holdings Ltd 6.3 Redeemable convertible preference shares 8.8 - - - - 8.8
-
DocDoc Pte Ltd - Convertible Bond 2.8 0.1 - - - 2.8
(0.1)
Infinity Capital Group - Secured Loan Notes 1.4 0.2 - - - 1.4
(0.2)
Heirloom Investments - - - 0.5 - - 0.5
-
Project Nicklaus - 1.8 - - - (0.1) 1.7
-
Corporate debt - (3.9) - - - - (3.9)
-
Other liabilities - (1.4) - - 0.2 - (1.2)
-
Cash 0.3 - 1.7 (1.9) - - 0.1
Total Net Asset Value 15.1 0.6 2.2 (1.7) (0.1) (0.6) 15.5
Future Metal Holdings Limited ("FMH")
Our largest asset by value is the dolomite quarry project ("Quarry") in China,
Future Metal Holdings Limited ("FMHL"), which was previously known as Hong
Kong Mining Holdings. The Company has an 85% shareholding in FMHL.
JADE has been exploring the option of a partial or full exit of this
investment by actively engaging with interested parties on the ground in the
Shanxi Province as well as with brokers in Mainland China, Hong Kong and
Singapore.
Including loan disbursements provided by the Company to FMHL and its
subsidiaries and accrued PIK interest, the estimated fair value of the
Company's investment is US$ 5.3 million as of 30 June 2023. Due to the
potential exit of this investment, in order to be prudent, the company has
decided to apply a 100% provision against the income expected from FMHL.
Meize Energy Industries Holdings Limited ("Meize")
Swift Wealth Investments Limited, a 100% (2019: 100%) owned subsidiary of the
Company incorporated in the British Virgin Islands, held a 7.2% stake in Meize
through a redeemable preference share structure.
Meize is a privately owned company that designs and manufactures blades for
both onshore and offshore wind turbines.
In June 2022, the Company entered into a share purchase agreement for 112,500
shares of the Series B Preferred Equity in Meize for consideration of USD1.2
million. The transaction price implies a valuation of USD10.0 million for the
Company's investment in Meize.
The partial divestment was completed by the end of August 2022. The Company
held approximately 6.3% interest in Meize post this divestment.
As of 30 June 2023, the Company's interest in Meize had a fair value of US$
8.8 million based on an implied valuation following the divestment of 112,500
shares.
DocDoc Pte Ltd. ("DocDoc")
DocDoc is a Singapore-headquartered online network of over 23,000 doctors, 600
clinics, and 100 hospitals serving a wide array of specialities. It uses
artificial intelligence, cutting-edge clinical informatics, and proprietary
data to connect patients to doctors which fit their needs at an affordable
price.
DocDoc pivoted its business model to become a "Neo Insurer" and attempts to
partner with insurance companies to enhance their policy offerings. DocDoc is
working to offer fully-digitised insurance products to consumers or
businesses, exclusively through digital channels, with end-to-end digital
service delivery. These offerings will include quoting, binding, issuing of
policies, documentation, proof of insurance, electronic billing, payment and
real time policy management all digitally.
As of 30 June 2023, the carrying value of the Convertible Bond was US$ 2.8
million. An annual coupon of 8% (4.0% cash and 4% Payment-in-Kind was
converted to 8% Payment-in-Kind).
In order to be prudent, the company has decided to apply a 100% provision to
the income expected from DocDoc.
Infinity Capital Group Limited ("ICG")
Ultimate Prosperity Limited, a 100% owned subsidiary of the Company
incorporated in the British Virgin Islands, holds a Secured Loan to ICG.
ICG develops premium residential projects in Hirafu Village, a world-class ski
village in Niseko, Japan - one of the most popular winter travel destinations
in the world.
As the COVID-19 pandemic continues to impact Japan and the Hokkaido region,
ICG has been working closely with the local management to monitor the domestic
property market and the local market's response to the pandemic, including
construction project planning and potential movements in property prices.
As of 30 June 2023, the carrying value of the Secured Loan was US$ 1.4
million. The Company has decided to escalate its efforts to ensure an exit
from this position including taking legal action while also pursuing
consensual avenues. Due to the planned exit of this investment, in order to be
prudent, the company has decided to apply a 100% provision against the income
expected from ICG.
John Croft
Chairman
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Six months ended Year ended
30 June 30 June 31 December
2023 2022 2022
Note Unaudited Unaudited Audited
US$000 US$000 US$000
Income from unquoted financial assets 588 580 1,174
Finance income from loans - 679 1,359
Gain on disposal - 300 300
Gross portfolio income 4 588 1,559 2,833
Fair value changes on financial assets at fair value through profit or (loss) (101) 737 (47,409)
Investment provisions 4 (588) (3) (6,003)
Net portfolio income/(loss) 4 (101) 2,293 (50,579)
Management fees 13 (376) (674) (1,200)
Incentive fees - - 158
Administrative expenses (639) (344) (763)
Operating profit/(loss) (1,116) 1,275 (52,384)
Finance expense (273) (259) (520)
Profit/(loss) before taxation (1,389) 1,016 (52,904)
Taxation 5 - - -
(1,389) 1,016 (52,904)
Profit/(loss) and total comprehensive expense for the period
Earnings per share 7
Basic (0.75) cents 0.88 cents (45.89) cents
Diluted (0.75) cents 0.76 cents (45.89) cents
The results above relate to continuing operations.
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Note 30 June
2023 30 June 31 December
Unaudited 2022 2022
US$000 Unaudited Audited
US$000 US$000
Assets
Unquoted financial assets at fair value through profit or loss 8 18,708 67,344 18,227
Loans and other receivables 9 1,721 6,347 1,769
Cash and cash equivalents 100 437 321
Total assets 20,529 74,128 20,317
Liabilities
Other payables and accruals 1,209 1,257 1,334
Current liabilities 1,209 1,257 1,334
Loans & borrowings 10 3,873 3,827 3,859
Total liabilities 5,082 5,084 5,193
Net assets 15,447 69,044 15,124
Equity and reserves
Share capital 11 150,615 148,903 148,903
Treasury share reserve 11 (615) (615) (615)
Share based payment reserve 2,936 2,936 2,936
Accumulated losses (137,489) (82,180) (136,100)
Total equity and reserves attributable to owners of the parent 15,447 69,044 15,124
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Share Treasury share reserve Share Accumulated losses Total
capital US$'000 based US$000 US$000
US$000 payment
reserve
US$000
Group balance at 1 January 2022 148,903 (615) 2,936 (83,196) 68,028
Profit for the period - - - 1,016 1,016
Other comprehensive income - - - - -
Total comprehensive income for the period - - - 1,016 1,016
Group balance at 30 June 2022 148,903 (615) 2,936 (82,180) 69,044
Loss for the period - - - (53,920) (53,920)
Other comprehensive income - - - - -
Total comprehensive income for the period - - - (53,920) (53,920)
Group balance at 31 December 2022 and 1 January 2023 148,903 (615) 2,936 (136,100) 15,124
Loss and total comprehensive expense for the period - - - (1,389) (1,389)
Total comprehensive income for the period - - - (1,389) (1,389)
Issue of shares net of issue costs 1,712 - - 1,712
Group balance at 30 June 2023 150,615 (615) 2,936 (137,489) 15,447
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
Six months ended Year ended
30-Jun 30-Jun 31 December
2023 2022 2022
Unaudited Unaudited Audited
US$'000 US$'000 US$'000
Cash flow from operating activities
(Loss) / Profit before taxation (1,389) 1,016 (52,904)
Adjustments for:
Finance income - (679) (1,359)
Finance expense 273 259 520
Exchange loss 84 29 83
Fair value changes on unquoted financial assets at fair value through profit 19 (2,043) 47,074
or loss
Share-based expenses - - -
Fair value changes on loans and receivables at fair value through profit or - 679 5,059
loss
Realised (gain) on disposal of investments - (300) (300)
Increase/(Decrease) in other receivables (35) (21) 28
Increase/(Decrease) in other payables and accruals (127) 247
325
Net cash used in operating activities (1,175) (812) (1,477)
Cash flow from investing activities
Sale proceeds of unquoted financial assets at fair value through profit or - 400 1,200
loss
Purchase of unquoted financial assets at fair value through profit and loss (500) - -
Net cash generated from investing activities (500) 400 1,200
Issue of Shares 1,712 - -
Payment of interest on loans and borrowings (259) - (228)
Net cash generated used in financing activities 1,453 - (228)
Net (decrease) in cash & cash equivalents during the period (222) (412) (505)
Cash and cash equivalents and net debt at the beginning of the period 321 848 848
Foreign exchange on cash balances 1 1 (22)
Cash & cash equivalents and net debt at the end of the period 100 437 321
NOTES TO THE FINANCIAL INFORMATION
1. CORPORATE INFORMATION
The Company is a limited company incorporated in the British Virgin Islands
("BVI") under the BVI Business Companies Act 2004 on 18 January 2008. The
address of the registered office is Commerce House, Wickhams Cay 1, P.O. Box
3140, Road Town, Tortola, British Virgin Islands VG 1110 and its principal
place of business is 19/F., CMA Building, 64 Connaught Road Central, Central,
Hong Kong.
The Company is quoted on the AIM Market of the London Stock Exchange (code:
JADE) and the Quotation Board of the Open Market of the Frankfurt Stock
Exchange (code: 1CP1).
The principal activity of the Company is investment holding. The Company is
principally engaged in investing primarily in unlisted assets in the areas of
mining, power generation, health technology, telecommunications, media and
technology ("TMT"), and financial services or listed assets driven by
corporate events such as mergers and acquisitions, pre-IPO, or re-structuring
of state-owned assets.
The condensed consolidated interim financial information was approved for
issue on 29 September 2023.
2. BASIS OF PREPARATION
The condensed consolidated interim financial information has been prepared in
accordance with International Accounting Standard ("IAS") 34 "Interim
Financial Reporting" and presented in US Dollars.
3. PRINCIPAL ACCOUNTING POLICIES
The condensed consolidated interim financial information has been prepared on
the historical cost convention, as modified by the revaluation of certain
financial assets and financial liabilities at fair value through the income
statement.
The accounting policies and methods of computation used in the condensed
consolidated financial information for the six months ended 30 June 2023 are
the same as those followed in the preparation of the Group's annual financial
statements for the year ended 31 December 2022 and are those the Group expects
to apply into financial statements for the year ending 31 December 2023. There
was no impact on the Company's accounting policies as a result of any new or
amended standards which became applicable for the current accounting period.
The seasonality or cyclicality of operations does not impact the interim
financial information.
4. SEGMENT INFORMATION
The operating segment has been determined and reviewed by the Board to be used
to make strategic decisions. The Board considers there to be a single business
segment, being that of investing activity.
The reportable operating segment derives its revenue primarily from debt
investment in several companies and unquoted investments.
The Board assesses the performance of the operating segments based on a
measure of adjusted Earnings Before Interest, Taxes, Depreciation and
Amortisation ("EBITDA"). This measurement basis excludes the effects of
non-recurring expenditure from the operating segments such as restructuring
costs. The measure also excludes the effects of equity-settled share-based
payments and unrealised gains/losses on financial instruments.
The segment information provided to the Board for the reportable segment for
the periods are as follows:
Six months ended Year ended
30 June 30 June 31 December 2022
2023 2022
US$000 US$000 US$000
Income on unquoted financial assets 588 580 1,174
Financial income on loans & receivables - 679 1,359
Gain on disposal - 300 300
Gross portfolio income 588 1,559 2,833
Expected credit loss provision (588) (3) (6,003)
Foreign exchange (101) (84) (113)
Equity fair value adjustments - 821 (47,296)
Portfolio income through profit or loss (101) 2,293 (50,579)
Net assets:
FMHL 5,252 50,666 5,270
Meize 8,800 8,801 8,801
Other - - -
DocDoc 2,806 2,696 2,806
ICG 1,335 1,515 1,335
Infinity TNP - 3,650 -
Heirloom Investment Fund 500 - -
Other 15 16 15
Unquoted assets at fair value through profit or loss 18,708 67,344 18,227
Loans and other receivables at fair value through the profit or loss (third 1,721 6,347 1,769
party)
Cash 100 437 321
Liabilities (5,082) (5,084) (5,193)
Net assets 15,447 69,044 15,124
The impact of fair value changes on the investments in the portfolio are as
follows:
Six months ended Year ended
30 June 30 June 31 December 2022
2023 2022
US$000 US$000 US$000
Income on unquoted financial assets through profit or loss 588 580 1,174
Equity fair value adjustments:
- FMHL - (45,146)
- Meize - 1,500 1,500
- DocDoc - - -
- Infinity Capital Group - - -
- Infinity TNP - - (3,650)
- 1,500 (47,296)
Realised Gain - - 300
Expected credit loss provision:
- ICG (112) (3) (363)
- FMHL (300) - (581)
- DocDco (176) - -
Foreign exchange on unquoted financial assets at fair value through profit or (19) (34) (8)
loss
Total fair value changes on financial assets at fair value through profit or (19) 2,043 (46,774)
loss
5. TAXATION
The Company is incorporated in the BVI and Hong Kong. The Company is not
subject to any income tax in the BVI. The Company does not engage in any
business activities or generate income in Hong Kong; therefore it is not
subject to taxation in Hong Kong.
6. DIVIDEND
The Board does not recommend the payment of an interim dividend in respect of
the six months ended 30 June 2023 (30 June 2022: Nil).
7. EARNINGS PER SHARE
The calculation of the basic and diluted earnings per share attributable to
owners of the Group is based on the following:
Six months ended Year ended
30 June 30 June 31 December
2023 2022 2022
US$000 US$000 US$000
Numerator
Basic/Diluted: Net (loss) / profit (1,389) 1,016 (52,904)
Number of shares
'000 '000 '000
Denominator
Basic: Weighted average shares 185,008 115,278 115,278
Dilutive effect of warrants - 17,568 -
Diluted: Adjusted weighted average shares 185,008 132,846 115,278
Earnings per share
Basic (cents) (0.75) 0.88 (45.89)
Diluted (cents) (0.75) 0.76 (45.89)
For the year ended 31 December 2022 and the period ending 30 June 2023, the
warrants issued to the Investment Manager were anti-dilutive and therefore
there is no impact on the weighted average shares in issue. 1,002,333 warrants
were issued during the current period ending 30 June 2023.
8. UNQUOTED FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR
LOSS
30 June 30 June 31 December
2023 2022 2022
US$000 US$000 US$000
At the beginning of the period 18,227 66,202 66,202
Fair value changes through profit and loss 569 2,045 (46,131)
Expected credit loss provision through profit and loss (588) (3) (944)
Realised gain - - 300
Disposals - (900) (1,200)
Additional investment 500 - -
At the end of the period 18,708 67,344 18,227
On 5 April 2023, the Company invested $500,000 in Heirloom Investment Fund SPC
which provides a diversified portfolio of asset backed and / or income
producing investments target to deliver a risk-adjusted return over the long
term across geographically diverse assets. The investment is expected to
provide a fixed yield of 6% per annum, contingent on the performance of the
underlying investments.
9. LOANS AND OTHER RECEIVABLES AT FAIR VALUE THROUGH PROFIT OR
LOSS
30 June 30 June 31 December
2023 2022 2022
US$000 US$000 US$000
At the beginning of the period 1,769 5,556 5,556
Additions - Meize consideration - 800 -
Fair value changes through profit and loss (48) (688) (87)
Expected credit loss provision through profit and loss - - (5,059)
Finance income on loans - 679 1,359
At the end of the period 1,721 6,347 1,769
Note 30 June 30 June 31 December
2023 2022 2022
US$000 US$000 US$000
Due in respect of Meize divestment - 800 -
Other receivables 1,721 5,547 1,769
Total loans and borrowings 1,721 6,347 1,769
Loans represent the Convertible Bond issued by Fook Lam Moon Holdings plus
accrued interest. The Group has assessed the recoverability of Loans in
accordance with its policy, and at year-end 31 December 21 applied a 100%
provision against this investment such that the carrying value of the
Convertible Bond was US$0.0m. The circumstances remain unchanged as at 30 June
2023. No bond interest receivable has been recognised during the period.
The breakdown of Loans is as follows:
30 June 30 June 31 December
2023 2022 2022
US$000 US$000 US$000
Loan principal 26,500 26,500 26,500
Accrued PIK interest 2,248 1,966 2,248
Accrued interest payable in cash 3,070 2,672 3,070
Fair Value Adjustments - Principal (26,500) (26,500) (26,500)
Fair Value Adjustments - Accrued Interest (5,318) (4,638) (5,318)
Net loans receivable - - -
10. LOANS AND BORROWINGS
30 June 30 June 31 December
2023 2022 2022
US$000 US$000 US$000
Corporate debt 3,873 3,827 3,859
Total loans and borrowings 3,873 3,827 3,859
The movement in loans and borrowings is as follows:
30 June 30 June 31 December
2023 2022 2022
US$000 US$000 US$000
Opening balance 3,859 3,568 3,568
Borrowing costs amortised - 31 52
Interest expense accrued 273 228 467
Payment of interest liability (259) - (228)
Closing balance 3,873 3,827 3,859
11. SHARE CAPITAL
Number of Amount
Shares US$000
Issued share capital excluding treasure shares at 31 December 2022 115,277,869 148,288
Shares issues in the period 201,996,350 1,712
Issued share capital excluding treasure shares at 30 June 2023 317,274,219 150,000
Consisting of:
Authorised, called-up and fully paid ordinary shares of no-par value each at 319,922,023 150,615
30 June 2023
Authorised, called-up and fully paid ordinary shares of no-par value held as (2,647,804) (615)
treasury shares by the Company at 30 June 2023
(i) Under the BVI corporate laws and regulations, there is no
concept of "share premium", and all proceeds from the sale of no-par value
equity shares are deemed to be share capital of the Company.
12. FINANCIAL INSTRUMENTS
Financial assets
As at As at As at
30 June 30 June 31 December
2023 2022 2022
US$'000 US$'000 US$'000
Unquoted financial assets at fair value 18,708 67,344 18,227
Other receivables at fair value 1,659 6,291 1,738
Cash and cash equivalents at amortised cost 100 437 321
Financial assets 20,467 74,073 20,286
Financial liabilities
As at As at As at
30 June 30 June 31 December
2023 2022 2022
US$'000 US$'000 US$'000
Other payables and accruals at amortised cost 1,209 1,257 1,334
Corporate debt at amortised cost 3,873 3,827 3,859
Financial liabilities 5,082 5,084 5,193
The corporate debt reached maturity in October 2022. The Company has not yet
realized sufficient funds from its current program of legacy asset disposals
to redeem these bonds. In December 2022 the Company agreed an extended
maturity of the loan notes issued to 31 December 2023 and an increased
interest rate of 15% from December 2022. The interest rate payable on the
principal amount of the loan notes will increase to 16% per annum where
US$1.8m or more of the principal amount remains outstanding by 30 June 2023.
The interest payment due on 30 June 2023 was not made and the Company agreed
with bondholders to increase the interest rate between 1 July 2023 and 14
August 2023 to 18%. As the interest payment was not made by 14 August 2023,
the interest rate will continue at 18% until such payment is made.
Financial assets at fair value through profit or loss
The following table provides an analysis of financial instruments that are
measured subsequent to initial recognition at fair value, grouped into Level
1, 2 or 3 based on the degree to which the fair value is observable:
Note As at As at As at
30 June 2023 30 June 31 December
US$000 2022 2022
US$000 US$000
Level 3
Unquoted financial assets at fair value 8 18,708 67,344 18,227
Other receivables at fair value 9,14 1,721 6,291 1,769
20,429 73,635 19,996
There is no transfer between levels in the current period. Carrying values of
all financial assets and liabilities are approximate to fair values. The value
of level 3 investments has been determined using the yield capitalisation
(discounted cash flow) method.
13. RELATED PARTY TRANSACTIONS
During the period under review, the Group entered into the following
transactions with related parties and connected parties:
Notes 30 June 30 June 31 December
2023 2022 2022
US$000 US$000 US$000
Remuneration payable to Directors 183 117 260
Harmony Capital
Management fee (i) 376 674 1,200
Incentive fee - - (158)
Amount due to Harmony Capital at period end 910 1,089 1,234
(i) Harmony Capital has been appointed as the Investment Manager of
the Group. In prior years the management fee. was calculated and paid
bi-annually in advance calculated at a rate of 0.875% of the net asset value
of the Company's portfolio of assets at 30 June and 31 December in each
calendar year. A new management fee was agreed in April 2023 reducing the
annual management fee to $350,000 per annum and amending the incentive
structure to encourage an orderly realization of value from the Company's
existing portfolio.
14. EVENTS AFTER THE REPORTING PERIOD
On 26 July 2023 agreement was reached with the bondholders to waive rights to
accelerate the US$10,000,000 12.5% fixed secured bond instrument resulting
from the non-payment of interest due on Friday 14 July 2023. Interest will
accrue on the bonds at an interest rate between 1 July 2023 and 14 August 2023
to 18%. As the interest payment was not made by 14 August 2023, the interest
rate will continue at 18% until such payment is made.
15. COPIES OF THE INTERIM REPORT
The interim report is available for download from
www.jaderoadinvestments.com.
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