REG - MobilityOne Limited - Half-year Report
30/09/2022 07:00
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RNS Number : 2609B MobilityOne Limited 30 September 2022
30 September 2022
MobilityOne Limited
("MobilityOne", the "Company" or the "Group")
Unaudited interim results for the six months ended 30 June 2022
MobilityOne (AIM: MBO), the e-commerce infrastructure payment solutions and
platform provider, announces its unaudited interim results for the six months
ended 30 June 2022.
Highlights:
· Revenue decreased by 13.2% to £113.4 million (H1 2021:
£130.7 million) due to lower sales for the Group's mobile phone prepaid
airtime reload and bill payment business in Malaysia;
· Profit after tax of £0.34 million (H1 2021: profit after
tax of £1.01 million);
· Cash and cash equivalents (including fixed deposits) at
30 June 2022 of £4.72 million (30 June 2021: £4.52 million); and
· The Group is cautious on the outlook for the remainder of
2022, taking into consideration the current business and operational landscape
of rising inflation and interest rates as well as higher administrative
expenses notwithstanding that the e-payments industry is expected to continue
to grow in Malaysia.
For further information, contact:
MobilityOne
Limited +6
03 89963600
Dato' Hussian A. Rahman,
CEO
www.mobilityone.com.my
har@mobilityone.com.my
Allenby Capital Limited
(Nominated Adviser and
Broker)
+44 20 3328 5656
Nick Athanas / Vivek Bhardwaj
About the Group:
MobilityOne provides e-commerce infrastructure payment solutions and platforms
through its proprietary technology solutions. The Group has developed an
end-to-end e-commerce solution which connects various service providers across
several industries such as banking, telecommunication and transportation
through multiple distribution devices including EDC terminals, mobile devices,
automated teller machines ("ATM") and internet banking. The Group's technology
platform is flexible, scalable and designed to facilitate cash, debit card and
credit card transactions from multiple devices while controlling and
monitoring the distribution of different products and services.
For more information, refer to our website at www.mobilityone.com.my
(http://www.mobilityone.com.my)
Chairman's statement
The Group's revenue decreased by 13.2% to £113.4 million (H1 2021: revenue of
£130.7 million) in the first six months of 2022. This was as a result of
lower sales from the Group's products and services, namely the mobile phone
prepaid airtime reload and bill payment business through the Group's banking
channels (i.e. mobile banking and internet banking) with 10 banks and third
parties' e-wallet applications. The Malaysian market accounted for almost the
Group's entire revenue for the first six months of 2022. As a consequence of
the reduction of revenue, coupled with higher administrative expenses, the
Group registered a lower profit after tax of £0.34 million in the first six
months of 2022 (H1 2021: profit after tax of £1.01 million).
The Group's other businesses (i.e., the international remittance services and
e-money in Malaysia and e-payment solutions activities in the Philippines and
Brunei) continued to remain small in the first six months of 2022.
As at 30 June 2022, the Group had cash and cash equivalents (including fixed
deposits) of £4.72 million (30 June 2021: cash and cash equivalents of £4.52
million) while the secured loans and borrowings from financial institutions
increased to £2.89 million (30 June 2021: £2.06 million).
Current trading and outlook
The Group's business activities are predominately concentrated in Malaysia.
Other than the Group's core mobile phone prepaid airtime reload and bill
payment business, the Group's international remittance and e-money businesses
are expected to remain insignificant in 2022. This is also expected to be the
case for the e-payment solutions activities in the Philippines and Brunei.
On 1 June 2022 the Company announced that its wholly-owned subsidiary in
Malaysia, MobilityOne Sdn Bhd, had received a license from MasterCard
Asia/Pacific Pte Ltd ("MasterCard") and approval from the Central Bank of
Malaysia to issue MasterCard prepaid cards. In line with announced
expectations, the Group has commenced the issuance of MasterCard prepaid cards
in Malaysia on a small scale to complement the Group's existing e-wallet and
is part of the Group's end-to-end payment ecosystem.
However, the Central Bank of Malaysia has not yet given its decision, the
timings of which continue to remain uncertain, for the Group to expand its
money transfer business via the Society for Worldwide Interbank Financial
Telecommunication ("SWIFT") network. Nevertheless, the Group is currently
working closely with a bank in Malaysia on the integration process while
waiting for the Central Bank of Malaysia's approval.
On 11 October 2021, the Group entered into a joint venture cum shareholders
agreement with One M Tech Pty Ltd to explore e-commerce and e-payment business
opportunities in Australia. As there have been no developments or progress
made by the joint venture partner, the Group has today given a notice to the
joint venture partner to terminate the agreement. While this joint venture cum
shareholders agreement was previously envisaged to not contribute any material
revenue or earnings to the Group, should a viable new opportunity arise, the
Group will reassess exploring potential business expansion in Australia again
in the future.
In order for the Group to expand its business in the UK, M-One Tech Limited,
the Company's wholly-owned subsidiary in the UK, continues to progress its
work in respect of re-submit an application to the Financial Conduct Authority
(the "FCA"), the financial regulatory body in the UK, for authorisation as an
electronic money institution to provide e-money services in the UK (together
the "FCA Application"). While it was originally the Group's intention to
re-submit the FCA Application by September 2022, as most recently announced by
the Group on 29 June 2022, the Group now intends to re-submit the revised FCA
Application reflecting the FCA's feedback in the fourth quarter of 2022.
Notwithstanding that the e-payments industry is expected to continue to grow
in Malaysia in the long-term and that the Group will continue to invest and
enhance its research and development as the backbone to support the business
expansion and technology advancement, the Group is cautious on the outlook for
the remainder of 2022. This cautious view takes into consideration the current
business and operational landscape which comprises rising inflation and
interest rates as well as higher administrative expenses. Rising
administrative expenses include higher staff costs, higher infrastructure and
marketing costs as well as other related expenses. As a result, in order to
maintain or grow the Group's business, it is the Board's view that the Group's
gross profit margin for its products and services are likely to also be
impacted. For future growth, the Group will also consider partnerships with
parties in complementary businesses to explore new business opportunities.
Abu Bakar bin Mohd Taib (Chairman)
30 September 2022
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE SIX MONTHS PERIOD ENDED 30 JUNE 2022
Six months Six months Financial year
Ended Ended Ended
30 June 2022 30 June 2021 31 Dec 2021
Unaudited Unaudited Audited
CONTINUING OPERATIONS £ £ £
Revenue 113,355,113 130,710,091 255,707,270
Cost of sales (107,103,390) (123,637,568) (242,050,541)
GROSS PROFIT 6,251,723 7,072,523 13,656,729
Other operating income 92,839 91,793 155,832
Administration expenses (5,549,417) (5,403,641) (11,256,000)
Other operating expenses (209,083) (314,042) (411,740)
Net loss on financial instruments - - (13,366)
OPERATING PROFIT 586,062 1,446,633 2,131,455
Finance costs (63,501) (58,603) (115,620)
PROFIT BEFORE TAX 522,561 1,388,030 2,015,835
Tax (184,356) (374,862) (507,582)
PROFIT FROM CONTINUING OPERATIONS
338,205 1,013,168 1,508,253
Attributable to:
Owners of the parent 338,842 1,013,868 1,524,429
Non-controlling interest (637) (700) (16,176)
338,205 1,013,168 1,508,253
EARNINGS PER SHARE
Basic earnings per share (pence) 0.319 0.954 1.434
Diluted earnings per share (pence) 0.301 0.882 1.341
PROFIT FOR THE PERIOD/YEAR 338,205 1,013,168 1,508,253
OTHER COMPREHENSIVE PROFIT/(LOSS)
Foreign currency translation 296,985 (30,164) (44,254)
TOTAL COMPREHENSIVE PROFIT FOR THE PERIOD/YEAR
635,190 983,004 1,463,999
Total comprehensive profit attributable to:
Owners of the parent 636,224 962,256 1,458,754
Non-controlling interest (1,034) 20,748 5,245
635,190 983,004 1,463,999
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2022
At At At
30 June 2022 30 June 2021 31 Dec 2021
Unaudited Unaudited Audited
£ £ £
Assets
Non-current assets
Intangible assets 421,863 598,367 433,844
Property, plant and equipment 1,180,684 991,405 950,664
Right-of-use assets 191,759 218,708 155,660
Other investment 12,144 - -
1,806,450 1,808,480 1,540,168
Current assets
Inventories 3,162,123 2,485,534 3,118,571
Trade receivables 2,087,657 1,651,637 2,299,267
Other receivables 927,759 837,538 878,431
Tax recoverable 169,179 - 53,010
Fixed deposits 1,603,471 1,471,568 1,508,388
Cash and cash equivalents 3,114,703 3,050,103 3,157,136
11,064,892 9,496,380 11,014,803
Total Assets 12,871,342 11,304,860 12,554,971
Shareholders' equity
Equity attributable to equity holders of the Company
Called up share capital 2,657,470 2,657,470 2,657,470
Share premium 909,472 909,472 909,472
Reverse acquisition reserve 708,951 708,951 708,951
Foreign currency translation reserve 990,089 706,770 692,707
Accumulated profit/ (losses) 221,219 (628,184) (117,623)
Shareholders' equity 5,487,201 4,354,479 4,850,977
Non-controlling interest (8,263) 8,274 (7,229)
Total Equity 5,478,938 4,362,753 4,843,748
Liabilities
Non-current liabilities
Loans and borrowings - secured 225,171 226,161 217,881
Lease liabilities 74,047 76,386 83,501
Deferred tax liabilities 44,782 55,204 42,570
344,000 357,751 343,952
Current liabilities
Trade payables 947,062 1,030,890 1,195,283
Other payables 3,116,652 3,195,262 4,008,268
Amount due to directors 176,457 140,878 124,426
Loans and borrowings - secured 2,668,243 1,830,684 1,958,841
Lease liabilities 108,810 124,358 71,988
Tax payables 31,180 262,284 8,465
7,048,404 6,584,356 7,367,271
Total Liabilities 7,392,404 6,942,107 7,711,223
Total Equity and Liabilities 12,871,342 11,304,860 12,554,971
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2022
Non-Distributable Distributable
Foreign
Reverse Currency Non-
Share Share Acquisition Translation Accumulated Controlling Total
Capital Premium Reserve Reserve Losses Total Interest Equity
£ £ £ £ £ £ £ £
As at 1 January 2021 2,657,470 909,472 708,951 758,382 (1,642,052) 3,392,223 (12,474) 3,379,749
Foreign currency translation - - - (51,612) - (51,612) 21,448 (30,164)
Profit for the period - - - - 1,013,868 1,013,868 (700) 1,013,168
As at 30 June 2021 2,657,470 909,472 708,951 706,770 (628,184) 4,354,479 8,274 4,362,753
As at 1 July 2021 2,657,470 909,472 708,951 706,770 (628,184) 4,354,479 8,274 4,362,753
Foreign currency translation - - - (14,063) - (14,063) (27) (14,090)
Profit/(Loss) for the period - - - - 510,561 510,561 (15,476) 495,085
As at 31 Dec 2021 2,657,470 909,472 708,951 692,707 (117,623) 4,850,977 (7,229) 4,843,748
As at 1 January 2022 2,657,470 909,472 708,951 692,707 (117,623) 4,850,977 (7,229) 4,843,748
Foreign currency translation - - - 297,382 - 297,382 (397) 296,985
Profit for the period - - - - 338,842 338,842 (637) 338,205
As at 30 June 2022 2,657,470 909,472 708,951 990,089 221,219 5,487,201 (8,263) 5,478,938
Share capital is the amount subscribed for shares at nominal value.
Share premium represents the excess of the amount subscribed for share capital
over the nominal value of the respective shares net of share issue expenses.
The reverse acquisition reserve relates to the adjustment required by
accounting for the reverse acquisition in accordance with IFRS 3.
The Company's assets and liabilities stated in the Statement of Financial
Position were translated into Pound Sterling (£) using the closing rate as at
the Statement of Financial Position date and the income statements were
translated into £ using the average rate for that period. All resulting
exchange differences are taken to the foreign currency translation reserve
within equity.
Retained earnings represent the cumulative earnings of the Group attributable
to equity shareholders.
Non-controlling interests represent the share of ownership of subsidiary
companies outside the Group.
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2022
Six months Six months Financial year
Ended Ended ended
30 June 2022 30 June 2021 31 Dec 2021
Unaudited Unaudited Audited
£ £ £
Cash flows (used in)/from operating activities
Cash (used in)/generated from operations (205,386) 2,011,004 2,409,305
Interest paid (63,501) (58,630) (115,620)
Interest received 11,221 12,568 12,867
Tax paid (287,340) (242,859) (723,469)
Tax refund 5,470 - -
Net cash (used in)/generated from operating activities (539,536) 1,722,083 1,583,083
Cash flows (used in) investing activities
Purchase of property, plant and equipment (306,614) (1,692) (34,866)
Addition in right-of-use assets - - (5,690)
Net cash outflow for acquisition of subsidiary company - (408,722) (376,517)
Repayment from associate company - - 221,583
Addition in non-controlling interests - - 21,310
Proceeds from disposal of property, plant & equipment 8,370 - -
Net cash (used in) investing activities (298,244) (410,414) (174,180)
Cash flows from/(used in) financing activities
Net change of banker acceptance 607,556 (1,136,798) (1,202,597)
Repayment of lease liabilities (53,825) (71,214) (122,576)
Repayment of term loan (4,038) (6,685) (8,734)
Net cash from/(used in) financing activities 549,693 (1,214,697) (1,333,907)
(Decrease)/Increase in cash and cash equivalents (288,087) 96,972 74,996
Effect of foreign exchange rate changes 340,737 6,823 172,652
Cash and cash equivalents at beginning of period/year 4,665,524 4,417,876
4,417,876
Cash and cash equivalents at end of period/year 4,718,174 4,521,671 4,665,524
NOTES TO THE INTERIM FINANCIAL STATEMENTS
1. Basis of preparation
The Group's interim financial statements for the six months ended 30 June 2022
were authorised for issue by the Board of Directors on 30 September 2022.
The interim financial statements are unaudited and have been prepared in
accordance with International Financial Reporting Standards (IFRSs and IFRIC
interpretations) issued by the International Accounting Standards Board
(IASB), as adopted by the European Union, and with those parts of the
Companies (Jersey) Law 1991 applicable to companies preparing their financial
statements under IFRS. It has been prepared in accordance with IAS 34 "Interim
Financial Reporting" and does not include all of the information required for
full annual financial statements. The financial statements have been prepared
under the historical cost convention.
Full details of the accounting policies adopted, which are consistent with
those disclosed in the Company's 2021 Annual Report, will be included in the
audited financial statements for the year ending 31 December 2022.
2. Basis of consolidation
The consolidated statement of comprehensive income and statement of financial
position include financial statements of the Company and its subsidiaries made
up to 30 June 2022.
3. Nature of financial information
The unaudited interim financial information for the six months ended 30 June
2022 does not constitute statutory accounts under the meaning of Section 435
of the Companies Act 2006. The comparative figures for the year ended 31
December 2021 are extracted from the audited statutory financial statements.
Full audited financial statements of the Group in respect of that financial
year prepared in accordance with IFRS, which we received an unqualified audit
opinion, have been delivered to the Registrar of Companies.
4. Functional and presentation currency
(i) Functional and presentation currency
Items included in the financial statements of each of the Group's entities are
measured using the currency of the primary economic environment in which the
entity operates (the functional currency). The functional currency of the
Group is Ringgit Malaysia (RM). The consolidated financial statements are
presented in Pound Sterling (£), which is the Company's presentational
currency as this is the currency used in the country in which the entity is
listed.
Assets and liabilities are translated into Pound Sterling (£) at foreign
exchange rates ruling at the Statement of Financial Position date. Results and
cash flows are translated into Pound Sterling (£) using average rates of
exchange for the period.
(ii) Transactions and balances
Foreign currency transactions are translated into the functional currency
using exchange rates prevailing at the dates of the transactions. Foreign
exchange gains and losses resulting from the settlement of such transactions
and from the translation at year/period-end exchange rates of monetary assets
and liabilities denominated in foreign currencies are recognised in the
statement of comprehensive income.
The financial information set out below has been
translated at the following rates:
Exchange rate (RM: £)
At Statement of Financial Position date Average for year/
Period
Period ended 30 June 2022 5.35 5.54
Period ended 30 June 2021 5.74 5.69
Year ended 31 December 2021 5.63 5.70
5. Segmental analysis
The Group has three operating segments as follows:
(a) Telecommunication services and electronic commerce solutions;
(b) Hardware; and
(c) Remittance services
No segmental analysis of assets and capital expenditure are presented as they
are mostly unallocated items which comprise corporate assets and liabilities.
No geographical segment information is presented as more than 95% of the
Group's revenue was generated in Malaysia.
Telecommunication services and electronic commerce solutions
Remittance
Group Hardware services Elimination Total
6months ended 30 June 2022 £ £ £ £ £
Segment revenue:
Sales to external customers 112,494,543 959,051 56,692 (155,173) 113,355,113
112,494,543 959,051 56,692 (155,173) 113,355,113
Profit before tax 522,561 - - - 522,561
Tax (184,356) - - (184,356)
Profit for the period 338,205 - - - 338,205
Non-cash expenses/(income)*
Depreciation of property, plant and equipment 132,115 - - - 132,115
Amortisation of intangible assets 33,384 - - - 33,384
Amortisation of right-of-use assets 43,584 - - - 43,584
209,083 - - - 209,083
Group
6months ended 30 June 2021
Segment revenue:
Sales to external customers 129,559,457 1,297,991 - (147,357) 130,710,091
129,559,457 1,297,991 - (147,357) 130,710,091
Profit before tax 1,388,030 - - - 1,388,030
Tax (374,862) - - - (374,862)
Profit for the period 1,013,168 - - - 1,013,168
Non-cash expenses/(income)*
Depreciation of property, plant and equipment 109,577 - - - 109,577
Amortisation of intangible assets 32,488 - - - 32,488
Amortisation of right-of-use assets 60,111 - - - 60,111
202,176 - - - 202,176
Group
Financial year ended 31 Dec 2021
Segment revenue:
Sales to external customers 252,841,803 3,248,248 - (382,781) 255,707,270
252,841,803 3,248,248 - (382,781) 255,707,270
Profit before tax 2,015,835 - - - 2,015,835
Tax (507,582) - - - (507,582)
Profit for the period 1,508,253 - - - 1,508,253
Non-cash expenses/(income)*
Depreciation of property, plant and equipment 243,980 - - - 243,980
Amortisation of intangible assets 64,864 - - - 64,864
Amortisation of right-of-use assets 104,169 - - - 104,169
Bad debt written off 36,339 - - - 36,339
Inventories written off 182 - - - 182
449,534 - - - 449,534
*The disclosure for non-cash expenses has not been split according to the
different segments as the cost to obtain such information is excessive and
provides very little by way of information.
*The disclosure for non-cash expenses has not been split according to the
different segments as the cost to obtain such information is excessive and
provides very little by way of information.
6. Taxation
Taxation on the income statement for the financial period comprises current
and deferred tax. Current tax is the expected amount of taxes payable in
respect of the taxable profit for the financial period and is measured using
the tax rates that have been enacted at the Statement of Financial Position
date.
Deferred tax is recognised on the liability method for all temporary
differences between the carrying amount of an asset or liability in the
Statement of Financial Position and its tax base at the Statement of Financial
Position date. Deferred tax liabilities are recognised for all taxable
temporary differences and deferred tax assets are recognised for all
deductible temporary differences, unused tax losses and unused tax credits to
the extent that it is probable that future taxable profit will be available
against which the deductible temporary differences, unused tax losses and
unused tax credits can be utilised. Deferred tax is not recognised if the
temporary difference arises from goodwill or negative goodwill or from the
initial recognition of an asset or liability in a transaction which is not a
business combination and at the time of the transaction, affects neither
accounting profit nor taxable profit.
Deferred tax assets and liabilities are measured at the tax rates that are
expected to apply to the period when the asset is realised or the liability is
settled, based on the tax rates that have been enacted or substantively
enacted by the Statement of Financial Position date. The carrying amount of a
deferred tax asset is reviewed at each Statement of Financial Position date
and is reduced to the extent that it becomes probable that sufficient future
taxable profit will be available.
Deferred tax is recognised in the income statement, except when it arises from
atransaction which is recognised directly in equity, in which case the
deferred tax is also charged or credited directly in equity, or when it arises
from a business combination that is an acquisition, in which case the deferred
tax is included in the resulting goodwill or negative goodwill.
7. Earnings per share
The basic earnings per share is calculated by dividing the profit in the six
month period ended 30 June 2022 of £338,842 (30 June 2021: profit of
£1,013,868 and year ended 31 December 2021: profit of £1,524,429)
attributable to owners of the parent by the number of ordinary shares
outstanding at 30 June 2022 of 106,298,780 (30 June 2021: 106,298,780 and 31
December 2021: 106,298,780).
The diluted earnings per share for the six month period ended 30 June 2022 is
calculated using the number of shares adjusted to assume the exercise of all
dilutive potential ordinary shares of 112,567,904 (ie, on 5 December 2014, the
Company granted share options of 10,600,000 shares at 2.5p to directors and
certain employees of the Group. Share options of 2,000,000 shares had lapsed
due to resignation of employees and no option has been exercised).
*The disclosure for non-cash expenses has not been split according to the
different segments as the cost to obtain such information is excessive and
provides very little by way of information.
6. Taxation
Taxation on the income statement for the financial period comprises current
and deferred tax. Current tax is the expected amount of taxes payable in
respect of the taxable profit for the financial period and is measured using
the tax rates that have been enacted at the Statement of Financial Position
date.
Deferred tax is recognised on the liability method for all temporary
differences between the carrying amount of an asset or liability in the
Statement of Financial Position and its tax base at the Statement of Financial
Position date. Deferred tax liabilities are recognised for all taxable
temporary differences and deferred tax assets are recognised for all
deductible temporary differences, unused tax losses and unused tax credits to
the extent that it is probable that future taxable profit will be available
against which the deductible temporary differences, unused tax losses and
unused tax credits can be utilised. Deferred tax is not recognised if the
temporary difference arises from goodwill or negative goodwill or from the
initial recognition of an asset or liability in a transaction which is not a
business combination and at the time of the transaction, affects neither
accounting profit nor taxable profit.
Deferred tax assets and liabilities are measured at the tax rates that are
expected to apply to the period when the asset is realised or the liability is
settled, based on the tax rates that have been enacted or substantively
enacted by the Statement of Financial Position date. The carrying amount of a
deferred tax asset is reviewed at each Statement of Financial Position date
and is reduced to the extent that it becomes probable that sufficient future
taxable profit will be available.
Deferred tax is recognised in the income statement, except when it arises from
a transaction which is recognised directly in equity, in which case the
deferred tax is also charged or credited directly in equity, or when it arises
from a business combination that is an acquisition, in which case the deferred
tax is included in the resulting goodwill or negative goodwill.
7.
Earnings per share
The basic earnings per share is calculated by dividing the profit in the six
month period ended 30 June 2022 of £338,842 (30 June 2021: profit of
£1,013,868 and year ended 31 December 2021: profit of £1,524,429)
attributable to owners of the parent by the number of ordinary shares
outstanding at 30 June 2022 of 106,298,780 (30 June 2021: 106,298,780 and 31
December 2021: 106,298,780).
The diluted earnings per share for the six month period ended 30 June 2022 is
calculated using the number of shares adjusted to assume the exercise of all
dilutive potential ordinary shares of 112,567,904 (ie, on 5 December 2014, the
Company granted share options of 10,600,000 shares at 2.5p to directors and
certain employees of the Group. Share options of 2,000,000 shares had lapsed
due to resignation of employees and no option has been exercised).
8. Reconciliation of profit before tax to cash generated from operations
Six months Six months Financial year
ended Ended ended
30 June 2022 30 June 2021 31 Dec 2021
Unaudited Unaudited Audited
£ £ £
Cash flow from operating activities
Profit before tax 522,561 1,388,030 2,015,835
Adjustments for:
Amortisation of intangible assets 33,384 32,488 64,864
Amortisation of right-of-use assets 43,584 60,111 104,169
Bad debt written off - - 36,339
Deposit written off - - 8,683
Depreciation of property, plant and equipment 132,115 109,577 243,980
Gain on disposal of property, plant & equipment (8,090) - -
Impairment loss on goodwill - - 99,939
Interest expenses 63,501 58,630 115,620
Inventories written off - - 182
Interest income (11,221) (12,567) (12,867)
Waiver of debts - - (99,025)
Operating profit before 775,834 1,636,269 2,577,719
working capital changes
(Increase)/Decrease in inventories (43,552) 1,143,696 499,324
(Increase)/Decrease in receivables 150,139 (116,884) (848,771)
Increase in amount due to Directors & - - 13,435
Shareholder
Amount due to/by related company 52,030 59,310 -
Increase in payables (1,139,837) (711,387) 167,598
Cash generated from operations (205,386) 2,011,004 2,409,305
9. Contingent liabilities
In the period under review, corporate guarantees of RM27.0 million (£5.04
million) (H1 2021: RM21.1 million (£3.68 million) were given to a licensed
bank by the Company for credit facilities granted to a subsidiary company.
10. Significant accounting policies
The interim consolidated financial statements have been prepared applying the
same accounting policies that were applied in the preparation of the Company's
published consolidated financial statements for the year ended 31 December
2021 except for the adoption of new and amended reporting standards, which are
effective for periods commencing on or after 1 January 2022. Various
amendments to standards and interpretations of standards are effective for
periods commencing on or after 1 January 2022 as detailed in the 2021 Annual
Report, none of which have any impact on reported results.
Amortisation of intangible assets
Software is amortised over its estimated useful life. Management estimated the
useful life of this asset to be within 10 years. Changes in the expected level
of usage and technological development could impact the economic useful life
therefore future amortisation could be revised.
The Group determines whether goodwill is impaired at least on an annual basis.
This requires an estimation of the value-in-use of the cash generating units
("CGU") to which goodwill is allocated. Estimating a value-in-use amount
requires management to make an estimation of the expected future cash flows
from the CGU and also to choose a suitable discount rate in order to calculate
the present value of those cash flows.
The research and development costs are amortised on a straight-line basis over
the life span of the developed assets. Management estimated the useful life of
these assets to be within 5 years. Changes in the technological developments
could impact the economic useful life and the residual values of these assets,
therefore future amortisation charges could be revised.
Impairment of goodwill on consolidation
The Group's cash flow projections include estimates of sales. However, if the
projected sales do not materialise there is a risk that the value of goodwill
would be impaired.
The Directors have carried out a detailed impairment review in respect of
goodwill. The Group assesses at each reporting date whether there is an
indication that an asset may be impaired, by considering cash flows forecasts.
The cash flow projections are based on the assumption that the Group can
realise projected sales. A prudent approach has been applied with no residual
value being factored. At the period end, based on these assumptions there was
no indication of impairment of the value of goodwill or of development costs.
Research and development costs
All research costs are recognised in the income statement as incurred.
Expenditure incurred on projects to develop new products is capitalised and
deferred only when the Group can demonstrate the technical feasibility of
completing the intangible asset so that it will be available for use or sale,
its intention to complete and its ability to use or sell the asset, how the
asset will generate future economic benefits, the availability of resources to
complete the project and the ability to measure reliably the expenditure
during the development. Product development expenditures which do not meet
these criteria are expensed when incurred.
Development costs, considered to have finite useful lives, are stated at cost
less any impairment losses and are amortised through other operating expenses
in the income statement using the straight-line basis over the commercial
lives of the underlying products not exceeding 5 years. Impairment is assessed
whenever there is an indication of impairment and the amortisation period and
method are also reviewed at least at each Statement of Financial Position
date.
11. Dividends
The Company has not proposed or declared an interim dividend.
9.
Contingent liabilities
In the period under review, corporate guarantees of RM27.0 million (£5.04
million) (H1 2021: RM21.1 million (£3.68 million) were given to a licensed
bank by the Company for credit facilities granted to a subsidiary company.
10.
Significant accounting policies
The interim consolidated financial statements have been prepared applying the
same accounting policies that were applied in the preparation of the Company's
published consolidated financial statements for the year ended 31 December
2021 except for the adoption of new and amended reporting standards, which are
effective for periods commencing on or after 1 January 2022. Various
amendments to standards and interpretations of standards are effective for
periods commencing on or after 1 January 2022 as detailed in the 2021 Annual
Report, none of which have any impact on reported results.
Amortisation of intangible assets
Software is amortised over its estimated useful life. Management estimated the
useful life of this asset to be within 10 years. Changes in the expected level
of usage and technological development could impact the economic useful life
therefore future amortisation could be revised.
The Group determines whether goodwill is impaired at least on an annual basis.
This requires an estimation of the value-in-use of the cash generating units
("CGU") to which goodwill is allocated. Estimating a value-in-use amount
requires management to make an estimation of the expected future cash flows
from the CGU and also to choose a suitable discount rate in order to calculate
the present value of those cash flows.
The research and development costs are amortised on a straight-line basis over
the life span of the developed assets. Management estimated the useful life of
these assets to be within 5 years. Changes in the technological developments
could impact the economic useful life and the residual values of these assets,
therefore future amortisation charges could be revised.
Impairment of goodwill on consolidation
The Group's cash flow projections include estimates of sales. However, if the
projected sales do not materialise there is a risk that the value of goodwill
would be impaired.
The Directors have carried out a detailed impairment review in respect of
goodwill. The Group assesses at each reporting date whether there is an
indication that an asset may be impaired, by considering cash flows forecasts.
The cash flow projections are based on the assumption that the Group can
realise projected sales. A prudent approach has been applied with no residual
value being factored. At the period end, based on these assumptions there was
no indication of impairment of the value of goodwill or of development costs.
Research and development costs
All research costs are recognised in the income statement as incurred.
Expenditure incurred on projects to develop new products is capitalised and
deferred only when the Group can demonstrate the technical feasibility of
completing the intangible asset so that it will be available for use or sale,
its intention to complete and its ability to use or sell the asset, how the
asset will generate future economic benefits, the availability of resources to
complete the project and the ability to measure reliably the expenditure
during the development. Product development expenditures which do not meet
these criteria are expensed when incurred.
Development costs, considered to have finite useful lives, are stated at cost
less any impairment losses and are amortised through other operating expenses
in the income statement using the straight-line basis over the commercial
lives of the underlying products not exceeding 5 years. Impairment is assessed
whenever there is an indication of impairment and the amortisation period and
method are also reviewed at least at each Statement of Financial Position
date.
11.
Dividends
The Company has not proposed or declared an interim dividend.
12. Interim report
This interim financial statement will, in accordance with Rule 26 of the AIM
Rules for Companies, be available shortly on the Company's website at
www.mobilityone.com.my (http://www.mobilityone.com.my) .
-Ends-
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