REG - MOH Nippon PLC - Interim Results
20/12/2024 09:45
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RNS Number : 9363Q MOH Nippon PLC 20 December 2024
MOH Nippon Plc
("MOH Nippon" or the "Company")
Unaudited Interim Report for the six months ended 30 September 2024
London, 20 December 2024 - MOH Nippon Plc (LSE: MOH), a crowdfunding services provider for real estate investment in Japan, today announces its unaudited consolidated interim results for the six months ended 30 September 2024.
Financial highlights for the period
· Revenue of JPY 4,009m (Sep 2023: JPY 4,930m)
· Profit before taxes of JPY 235m (Sep 2023: JPY 2,156m)
· While the Group's profit before tax declined from JPY 2.2
billion in the six months ended 30 September 2023 to JPY 235 million in the
six months ended 30 September 2024, the reduction is primarily due to
non-recurring expenses of JPY 1.3 billion share-based payment charge from the
recent listing and JPY 83 million reverse acquisition costs. As these expenses
are not expected to recur, the underlying business performance remains strong.
Strategic and operational highlights for the period and post period end
· Achieved readmission to the Official List of the Financial
Conduct Authority and to trading on the London Stock Exchange's Main Market
for listed securities following the reverse takeover of Minnadeooyasan-Hanbai
Co. Ltd, an established crowdfunding services provider in the real estate
market in Japan.
· Suspension of business operations in July 2024 for a period
of 30 days reduced crowdfunding services revenue by 39% compared to the
corresponding period in 2023.
· Despite the operational suspension, the operating margin
remained resilient, decreasing only marginally from 42% for the six months
ended 30 September 2023 to 41% for the same period in 2024.
· Initiated efforts to explore new real estate development
opportunities beyond the Japanese market.
Hoken Yanase, CEO of MOH Nippon, commented:
"The year to date has seen considerable developments and growth for MOH
Nippon. After the Company's readmission to the Official List of the Financial
Conduct Authority and to trading on the London Stock Exchange's Main Market
for listed securities in August, we have been making progress on many fronts".
"We are pleased with the rate of progress we have achieved in the short time
since readmission, including the successful launch of MINNADEOOYASAN
Soemon-cho by private MINNADEOOYASAN brand/platform. During the second half
of the year, we are looking to explore new real estate development
opportunities in Canada".
The unaudited interim report for the six months ended 30 September 2024 is
available on the Company's website at: www.mohnippon.com and in hard copy
form at the Company's registered office at 71-75 Shelton Street, Covent
Garden, London, United Kingdom, WC2H 9JQ.
It is also available for inspection at:
www.fca.org.uk/markets/primary-markets/regulatory-disclosures/national-storage-mechanism
(https://urldefense.proofpoint.com/v2/url?u=http-3A__www.fca.org.uk_markets_primary-2Dmarkets_regulatory-2Ddisclosures_national-2Dstorage-2Dmechanism&d=DwMGaQ&c=euGZstcaTDllvimEN8b7jXrwqOf-v5A_CdpgnVfiiMM&r=7Um2a7LLyUH5SxHgl6zdagatUzGQxXwYgU_CeVAgL9Q&m=kR_Hjjn07Jsd47IiTGeyUKC3Q2HOmc2k-HnXXjfJDbg&s=z7lAUYO9aq6HBtuB_Hq8I10m4igZv3uixdkqQJaliao&e=)
.
This announcement contains inside information for the purposes of Article 7 of
Regulation 2014/596/EU which is part of domestic UK law pursuant to the Market
Abuse (Amendment) (EU Exit) regulations (SI 2019/310).
The directors of the Company accept responsibility for the content of this
announcement.
Enquiries:
MOH Nippon Plc
Hoken Yanase, Chief Executive Officer Via Gracechurch Group
Frankie Leung, Chief Financial Officer Via Gracechurch Group
Cairn Financial Advisers LLP (Nominated Adviser and Broker)
Emily Staples +44 (0)20 7213 0897
Jo Turner +44 (0)20 7213 0885
Gracechurch Group
Harry Chathli, Claire Norbury +44 (0)20 4582 3500
Caution regarding forward looking statements
Certain statements in this announcement, are, or may be deemed to be, forward
looking statements. Forward looking statements are identified by their use of
terms and phrases such as ''believe'', ''could'', "should" ''envisage'',
''estimate'', ''intend'', ''may'', ''plan'', ''potentially'', "expect",
''will'' or the negative of those, variations or comparable expressions,
including references to assumptions. These forward-looking statements are not
based on historical facts but rather on the Directors' current expectations
and assumptions regarding the Group's future growth, results of operations,
performance, future capital and other expenditures (including the amount,
nature and sources of funding thereof), competitive advantages, business
prospects and opportunities. Such forward looking statements reflect the
Directors' current beliefs and assumptions and are based on information
currently available to the Directors.
About MOH Nippon Plc
MOH Nippon was established as 'Bowen Fintech Plc' and listed on the Official
List of the Financial Conduct Authority as a special purpose acquisition
company to acquire businesses in the technology innovations market, with a
focus on companies that own products or applications that are relevant to the
financial services sector. On 19 August 2024, it acquired, via a reverse
takeover, 97.41% of Minnadeooyasan-Hanbai Co. Ltd, an established crowdfunding
services provider in the real estate market in Japan, from Kyosei Bank Co. Ltd
("KBC"), representing KBC's entire shareholding in MOH. KBC, an investment
holding company with a group of over 50 companies providing services in
various sectors, owns 80.69% of the issued share capital of MOH Nippon Plc and
is a related party of MOH.
Chief Executive Officer's Statement and Interim Management Report
Introduction & Overview
I am delighted to present MOH Nippon's interim results for the six months
ended 30 September 2024, which has been a period of strong operational and
strategic progress for the Company and its subsidiary (together the "Group").
These results, our first as a public company, follow our successful
readmission to the Official List of the Financial Conduct Authority and to
trading on the London Stock Exchange's Main Market for listed securities
("Readmission") in August 2024 as a result of the reverse takeover of
Minnadeooyasan-Hanbai Co. Ltd ("MOH"). The Board believes that the acquisition
of MOH ("Acquisition") will give the Company exposure to the growing land
development and commercialisation business in Japan and internationally as
well as having a secure revenue stream from its historic expertise of
crowdfunding for Toshi-Souken Invest Bank Inc ("TSIB") a related party. The
directors of the Company ("Directors") believe that the business of MOH meets
a number of objectives which they initially set out at the time of the
Company's initial public offering in October 2022 including having a strong
balance sheet and a profitable and cash generative business which is not in
need of external capital for growth.
The Directors believe that the Acquisition and Readmission will enhance the
MOH brand and profile both in Japan and internationally, enable access to
additional real estate portfolios internationally, thus diversifying risk, and
provide access to fresh equity capital in the future to accelerate its growth
strategy, particularly in the area of technology-related real estate such as
cold-chain logistics.
To unlock this opportunity, the Group continues to pursue its strategy, with a
mission and values aligned to deliver this.
Mission:
The Company aims to eliminate future uncertainties and provide genuine asset
management solutions in real estate that bring peace of mind, while delivering
new social value to the world. MOH Nippon envisions becoming a global leader
in real estate crowdfunding and innovation-driven project financing.
By advocating and practicing the principles of a symbiotic economy, the
Directors believe that the Company is creating a market focused on
upward-trending income gains. Through the innovative asset management approach
of areal estate crowdfunding platform of the "MINNADEOOYASAN (Everyone's
Landlord) Series," which elevates real estate to a higher dimension, the
Company is shaping a new future in asset management.
Strategy
To date, MOH has been engaged in crowdfunding activities for real estate
projects in Japan from Japanese investors. Over the past three years (from
April 2020 until March 2023), the amount of capital raised has grown at a
compound annual growth rate of approximately 43 per cent. The Directors intend
to grow the business of the Group by:
(a) continuing to capitalise in the growth of the crowdfunding sector in Japan
with the provision of real estate investment opportunities to investors
through its proprietary pipeline and joint business with Toshi Souken Invest
Fund Inc . ("TSIF") and TSIB, (both related parties, being owned by KBC).
Development plans are underway for future projects including refrigerated
logistics infrastructure, a state-of-the-art medical centre, a cultural park,
and an entertainment hotel; and
(b) as a stand-alone business, MOH intends to establish an industrial real
estate cold-chain logistics business using an innovative freezing technology
(HybridIce) owned by the KBC group company, FrostiX Co., Ltd.
In an investment environment where interest rates have been extremely low for
a long time in Japan, and interest income has been almost non-existent,
alternative value-added, dividend paying proprietary funds are expected to
become increasingly attractive and the Directors believe that MOH is well
placed to capitalise on this, given the brand recognition and longevity of its
operations.
It is anticipated that in the short to medium term. MOH will continue to
generate the majority of its revenue from the current split of operations,
being crowd funding and the commercialisation work performed on real estate
purchases and sales. Over time, MOH intends to acquire more development
projects on its own, with a focus on those outside of Japan, where it will
focus on technology driven commercial projects (particularly cold-chain
logistics) with the intention of this revenue stream becoming more
significant.
There is no current intention to engage in crowdfunding activities in the UK
unless there is an opportunistic bolt-on business available for the Group to
acquire. MOH is currently only licensed to engage in crowdfunding activities
in Japan where the market is still experiencing growth. However, MOH does
intend to diversify its interest in cold-chain logistic facilities in the
ASEAN countries in the short-term, and into Europe and North America in the
medium term as part of its growth strategy.
Operational update
Following the successful Readmission in August 2024, MOH has experienced a
period of significant change. As outlined in the Company's prospectus dated 31
July 2024, MOH's operations were suspended for 30 days, leading to a 39%
decline in crowdfunding services revenue from JPY 3.1 billion for the six
months ended 30 September 2023 to JPY 1.9 billion for the six months ended 30
September 2024. Despite this temporary disruption, the Group's operating
margin saw only a slight decline, from 42% to 41% over the same periods.
Although the recovery in crowdfunding operations has been gradual, this
segment remains MOH's core and stable revenue driver. Management is confident
that operations will normalise and achieve targeted performance in the coming
months.
MOH continues its collaboration with TSIB on various joint real estate
development projects. Construction on the Toretore Marche project, a
commercial development project in Ise City, Mie Prefecture, which commenced in
August 2023, has progressed more slowly than anticipated. The Directors expect
this project to be completed by the financial year ending 31 March 2026.
Additionally, MOH made an initial investment of JPY 1.5 billion in a real
estate development project with TSIB in Saipan in July 2024. In September
2024, MOH successfully completed a joint real estate development project, the
Soemon-cho project, with TSIB in Osaka, Japan, generating revenue of JPY 2.1
billion. MOH offered the "MINNADEOOYASAN Soemon-cho" product for the
Soemon-cho project exclusively to existing investors through private
MINNADEOOYSAN, a platform for existing customers only. The use of the
"MINNADEOOYASAN Soemon-cho" product, a promotion strategy product, , saved
substantial advertising expenses as compared to offering investment products
to the public. The Group remains focused on identifying and pursuing new real
estate development opportunities in other countries.
The Directors continue to see significant opportunity for further organic
growth as they look ahead supplemented by selective acquisitions. In the near
term the Group remains focused on driving organic revenues, improving margins
and delivering attractive free cash flow.
Principal Risks and Uncertainties
The principal risks and uncertainties of the Group for the remaining 6 months
of the annual reporting period are described below. The Directors monitor and
update their assessment of principal risks and uncertainties on an ongoing
basis in the context of economic landscape and global geo-political events.
The current expectation is that the principal risks and uncertainties as
outlined above will remain prevalent for the remainder of the year.
Foreign currency exchange risks
MOH is based in Japan and reports in Japanese Yen and hence rate fluctuations
could negatively affect the cash flow, financial condition and results of
operations.
Global economic factors
Factors such as inflation, interest rates, legislative changes, political
decisions, industrial disruption both domestically in Japan and globally, may
have an impact on the Group's operating costs or the ability to attract
investors to invest in real estate projects.
Regulatory risks
The operating entity currently holds a licence from the Governor of Tokyo
under the Act on Specified Joint Real Estate Ventures (1994) (Japan) ("FTK
Act"), to conduct business as an agent or intermediary for the purposes of
facilitating the pooling of capital, via a joint venture vehicle, where
returns generated from real estate activity are then distributed to
participants. MOH acts as a crowdfunding services provider. The regulatory
environment surrounding the crowdfunding industry is susceptible to change and
the regulation in respect of the crowdfunding industry is continuously
evolving. Any change in the laws and/or regulations affecting the Group and
the KBC group, both in the UK or in Japan, may have a material adverse effect
on the ability of the Group to carry on its business and on the value of the
Company's share price.
Technological risks
The Group needs to continuously develop and redesign its technology in order
to remain competitive. If the competitors develop more advanced technologies,
the Group may be required to devote substantial resources to the development
of more advanced technologies to remain competitive. In doing so, the Group
faces an ongoing risk that failures may occur which result in service
interruptions or other negative consequences.
Financial overview
Financial presentation of the MOH Nippon Plc Group results - Reverse
acquisition accounting
On 19 August 2024, Bowen Fintech Plc ("Bowen") (renamed MOH Nippon Plc),
completed the acquisition of MOH from KBC to create the MOH Nippon Plc group.
The MOH Nippon group of companies includes 100% shareholding in MOH Nippon Plc
and the 97.41% shareholding in MOH.
Prior to the acquisition, Bowen had 55,000,000 ordinary shares in issue and
was established as a Special Purpose Acquisition Vehicle (SPAC) company on the
Official List of the Financial Conduct Authority. On acquisition, MOH Nippon
issued 229,779,093 new ordinary shares to KBC. Post combination, KBC held
80.69% of the Company's enlarged share capital.
On consolidation and presentation of the Group's financial position,
performance and cash flows, MOH was treated as the accounting acquirer, and
the legal parent company MOH Nippon Plc, was treated as the accounting
subsidiary, as if MOH had acquired MOH Nippon. As a result, and unlike a
traditional acquisition, the value of JPY 6,551 million (£34.5 million)
ascribed to MOH will not be capitalised as a non-current asset, but instead
recorded as shareholders' equity in the consolidated balance sheet.
The Statement of Financial Position at 30 September 2024 shows the acquisition
of MOH Nippon by MOH, which occurred on 19 August 2024. The Income Statement,
Statement of Financial Position and Statement of Cashflows shows, for the six
months ended 30 September 2024, the results of MOH with the inclusion of MOH
Nippon from 19 August 2024. The Income Statements, Statements of Financial
Position and Statements of Cashflows at 30 September 2023 and 31 March 2024
are those of MOH on a standalone basis.
In addition, the accounting for the reverse acquisition itself is deemed to be
the issue of shares to the original Bowen Fintech Plc shareholders by MOH and
this is accounted for as a share-based paymentwhich gives rise to a non-cash
charge in the income statement of JPY 1,344 million (£6.9 million), which is
included within the reverse acquisition reserve.
The Reverse Acquisition Accountingis described in more detail in note 5 to
these interim financial statements.
Revenues - in the six months ended 30 September 2024, the Group recorded
revenues of JPY 4,009 million (JPY 4,930 million in the six months ended 30
September 2023 and JPY 11,107 million for the year ended 31 March 2024).
Cost of sales - include land development costs and building construction
costs. These totalled JPY 1,800 million (JPY 30 million in the six months
ended 30 September 2023 and JPY 2,648 million for the year ended 31 March
2024).
Gross profit - for the six months ended 30 September 2024, the Company
reported a gross profit of JPY 2,209 million versus JPY 4,900 million for the
six months ended 30 September 2023 and a profit of JPY 8,459 million for the
year ended 31 March 2024.
Administration expenses - include staff costs, property costs, marketing, and
legal and professional costs. These totalled JPY 546 million in the six months
ended 30 September 2024 versus JPY 2,796 million (six months ended 30
September 2023) and JPY 5,335 million (year ended 31 March 2024), which
comprises all the MOH operating costs, with MOH Nippon's corporate costs
included from 19 August 2024 onwards.
Since 20 May 2024, MOH has terminated the employment agreements of staff who
were employed by MOH but seconded to KBC group companies. In the meantime,
these employees have entered into formal employment agreements directly with
KBC group companies which they are working for. This transition has
contributed to a reduction in personnel costs.
During the interim period, MOH launched the "MINNADEOOYASAN Soemon-cho"
product (a new method used by MOH to sell to existing investors) through the
private MINNADEOOYASAN platform/brand. Since this was offered exclusively to
the existing investors, there was no need for advertising, resulting in a
significant reduction in advertising costs.
Operating profit - is gross margin less operating costs, depreciation and
amortisation. The operating profit for the six months ended 30 September 2024
was JPY 1,662 million versus JPY 2,156 million for the six months ended 30
September 2023, and JPY 3,174 million for the year ended 31 March 2024.
Despite the temporary disruption of the business suspension in June 2024, the
Group's operating margin declined slightly from 42% for the six months ended
30 September 2023 to 41% for the for the six months ended 30 September 2024.
One-off and non-cash items - The Group's non-recurring and non-cash items
below Operating Profit are detailed as follows:
§ Reverse acquisition share-based payment and RTO costs - a JPY 1,344
million share-based payment charge reflecting the net cost of MOH acquiring
Bowen. This is a non-cash cost. In the six months ended 30 September 2024, the
Group incurred JPY 83 million of advisers' costs. (See note 5.) These costs
are non-recurring.
Interest expense on our leased assets - MOH has Right of Use leases on various
equipment. The finance charge on these leased assets of JPY 1.2 million is a
fair valuation charge to unwind the respective balance sheet lease
liabilities. The charge has increased from JPY 272,000 in September 2023, due
to the lease of a new office property.
Profit before tax - While the Group's profit before tax declined from JPY 2.2
billion in the six months ended 30 September 2023 to JPY 235 million in the
six months ended 30 September 2024, the reduction is primarily due to
non-recurring expenses of JPY 1.3 billion share-based payment charge from the
recent listing and JPY 83 million reverse acquisition costs. As these expenses
are not expected to recur, the underlying business performance remains strong,
Non-Current Assets - in the six months ended 30 September 2024, the Group
continued to invest in non-current assets, increasing property, plant and
equipment by JPY 1.4 million, and increased the Right of Use asset (and
associated lease liability) due to a lease variation on the business property
and entering a new small equipment lease.
Current Assets - increased mainly due to an increase of deposits and
receivables. Deposits to TSIB, a related party, increased to JPY 4.5 billion
due to the acquisition of the Soemon-cho property and the development of the
Saipan project.
Receivables from TSIF increased as a result of MOH and TSIB jointly selling
real estate to TSIF, with both parties recognising real estate sales revenue
receivable from TSIF. The receivables from TSIB and TSIF as a result of the
Soemon-cho property project have been settled on 16 December, 2024.
Cash balances at 30 September 2024 were JPY 890 million. The decrease is due
to the deposit paid to TSIB for the acquisition of the Soemon-cho property and
the development of the Saipan project.
Current Liabilities - Trade and other payables increased due to an increase in
payables to related parties and an increase in lease liabilities from lease
additions during the period.
Non-current liabilities - increased liability due to lease additions during
the period.
Net assets - at 30 September 2024 were JPY 6,703 million.
Shareholders' Equity - Share Capital, Share premium and the Merger Relief
Reserve total JPY 6,913 million at 30 September 2024 following the acquisition
of MOH by MOH Nippon Plc; the Reverse Acquisition Reserve of JPY (4,784)
million (which is the consolidation reserve created on the reverse acquisition
of combining MOH Nippon Plc and MOH); Foreign exchange translation and other
reserves of JPY 3 million; Non-controlling interest of JPY 169 million and
Retained earnings of JPY 4,402 million.
Cash outflows from operating activities - for the six months ended 30
September 2024 there were JPY 6,905 million outflows versus inflows of JPY
1,771 million for the six months ended 30 September 2023 and JPY 6,419 million
for the year ended 31 March 2024. The main cash outflows include amounts owed
from related parties, people, advisers and utility costs.
Investing activities - in the six months ended 30 September 2024, inflows from
investing activities totalled JPY 534 million, mainly from the cash acquired
in the Acquisition (6 months to 30 September 2023: outflows of JPY 11
million).
Financing activities - in the six months ended 30 September 2024, inflows from
financing activities totalled JPY 7.7 million, from loan interest income from
TSIB, a related company (6 months to 30 September 2023: nil).
Related Party Transactions
All related party transactions which have taken place in the first six months
of the current financial year are in the ordinary course of business and have
been conducted on normal commercial terms. Details of the material related
party transactions are summarised in note 10.
There were no changes in the related party transactions described in the last
annual report that could have a material effect on the financial position or
performance of the Company for the first six months of the current financial
year.
STATEMENT OF DIRECTORS' RESPONSIBILITIES
The Directors whose names and functions are as follows:
Mr Nigel Andrew Collins (Non-Executive Chairman)
Mr Hoken Yanase (Chief Executive Officer)
Mr Hiromitsu Sakai (Chief Operating Officer)
Mr Tak Chee (Frankie) Leung (Chief Financial Officer)
Mr Kazuo Ichimura (Non-Executive Director)
Mr Allan John Rowley (Non-Executive Director)
are responsible for preparing the Interim Report and Financial Statements in
accordance with applicable laws and regulations. As required by DTR 4.2.10R,
each member of the Board confirms that to the best of their knowledge:
· the consolidated set of financial statements has been
prepared in accordance with IAS 34 'Interim Financial Reporting' as adopted by
the UK and as issued by the International Accounting Standards Board (IASB)
and gives a true and fair view of the assets, liabilities, financial position
and profit or loss of the Company and MOH as a whole as required by DTR
4.2.4R;
· the interim management report includes a fair review of
the information required by DTR 4.2.7R (indication of important events during
the first six months and their impact on the consolidated financial statements
and description of principal risks and uncertainties for the remaining six
months of the year);
· the interim management report includes a fair review of
the information required by DTR 4.2.8R (disclosure of related party
transactions and changes therein); and
The Company is responsible for all information drawn up and made public in
accordance with DTR 4.2.11R
The Directors are also responsible for keeping records and underlying
documentation that are sufficient to show and explain the Company's
transactions and enable the financial position of the Company to be determined
with reasonable accuracy at any time. They are also responsible for
safeguarding the assets of the Company and hence for taking reasonable steps
to prevent and detect fraud and other irregularities.
Signed on behalf of the Board by:
Hoken Yanase
Director
20 December 2024
CONSOLIDATED INCOME STATEMENT
For the six-month period ended 30 September 2024
Six months to 30 September 2024 Six months to 30 September 2023
Year ended
31 March 2024
Unaudited Unaudited
Unaudited
Note JPY '000 JPY '000 JPY '000
Revenue 6 4,009,091 4,929,821 11,106,750
Cost of sales 6 (1,800,000) (30,330) (2,647,845)
Gross Profit
2,209,091 4,899,491 8,458,905
Administration expenses (546,285) (2,795,856) (5,334,698)
Depreciation and amortisation (17,195) (9,793) (18,828)
Other income/ (expense), net 16,853 62,529 68,751
Operating profit 1,662,464 2,156,371 3,174,130
Share-based payment charge as a result of listing (1,344,441) - -
Reverse acquisition costs (82,918) - -
Loss from retirement of property - - (436)
Profit before tax 235,105 2,156,371 3,173,694
Income tax (681,069) (664,356) (1,096,888)
(Loss)/profit for the period (445,964) 1,492,015 2,076,806
Allocation of (Loss)/profit for the period
Shareholders of the Company (470,197) 1,492,015 2,076,806
Non-controlling interest 24,233 - -
(Loss)/profit for the period (445,964) 1,492,015 2,076,806
Basic (loss)/ earnings per share (1.9373) 4.5496 6.3328
Diluted (loss)/ earnings per share (1.9373) 4.4360 6.1746
CONSOLIDATED STATEMENT OF OTHER COMPREHENSIVE INCOME
Six months to 30 September 2024 Six months to 30 September 2023 Year ended
31 March 2024
Unaudited Unaudited Unaudited
JPY '000 JPY '000 JPY '000
(Loss)/profit for the period (445,964) 1,492,015 2,076,806
Exchange gains arising on translation of
Foreign operations 3,200 - -
Total comprehensive (loss)/income for the period, net of tax (442,764) 1,492,015 2,076,806
Attributable to shareholders of the Company (466,997) 1,492,015 2,076,806
Attributable to non-controlling interest 24,233 - -
(442,764) 1,492,015 2,076,806
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30 September 2024
As at 30 September 2024 As at 30 September 2023 As at 31 March 2024
Unaudited Unaudited Unaudited
Note JPY '000 JPY '000 JPY '000
Non-current assets
Property, plant and equipment 11,346 10,247 10,198
Other non-current assets 8 1,094,931 1,849,338 1,337,789
Deferred tax 105,112 - 105,112
Total non-current assets 1,211,389 1,859,585 1,453,099
Current assets
Trade and other receivables 272,051 401,365 768,203
Amounts due from related parties 9,086,735 2,412,590 753,517
Cash and cash equivalents 890,286 2,109,025 7,250,522
Total current assets 10,249,072 4,922,980 8,772,242
Current liabilities
Trade and other payables 872,996 1,614,102 2,031,461
Amounts due to related parties 3,803,834 131,344 2,593,738
Lease liabilities 36,643 12,594 7,576
Total current liabilities 4,713,473 1,758,040 4,632,775
Non-current liabilities
Deferred tax liabilities - 12,945 -
Lease liabilities 44,184 18,924 15,119
Total non-current liabilities 44,184 31,869 15,119
6,702,804 4,992,656 5,577,447
Net assets
Shareholders' Equity
Share capital 9 541,295 439,253 439,253
Share premium 256,990 - -
Other reserves 1,333,630 136,247 136,247
Retained earnings 4,402,200 4,417,156 5,001,947
6,534,115 4,992,656 5,577,447
Non-controlling interest 168,689 - -
Total Equity 6,702,804 4,992,656 5,577,447
The financial information on pages 9 to 24 were approved and authorised for
issue by the Board of Directors on 20 December 2024 and were signed on its
behalf by:
Frankie Leung
Director
Company number: 13349097
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (UNAUDITED)
For the six months ended 30 September 2024
Other components of equity Reverse acquisition reserve FX translation reserve Total other reserves Non-controlling interest
Share Capital Share Premium Merger relief reserve Retained earnings Equity attributable to owners of the parent
Total equity
Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited
JPY '000 JPY '000 JPY '000 JPY '000 JPY '000 JPY '000 JPY '000 JPY '000 JPY '000 JPY '000 JPY '000
Balance at 31 March 2023* 436,753 138,747 - - - 138,747 2,925,141 3,500,641 - 3,500,641
Total comprehensive income - - - - - - 1,492,015 1,492,015 - 1,492,015
Balance at 30 September 2023* 436,753 138,747 - - - 138,747 4,417,156 4,992,656 - 4,992,656
Total comprehensive income - - - - - - 584,791 584,791 - 584,791
Balance at 31 March 2024* 436,753 138,747 - - - 138,747 5,001,947 5,577,447 5,577,447
Recognition of non-controlling interest** - (12,315) (2,526) - - (14,841) (129,550) (144,391) 144,391 -
-
Recognition of PLC net assets at acquisition date ** - - 223,679 - - 223,679 - 223,679 - 223,679
-
Issue of shares for acquisition of subsidiary (Note 9) - - (6,114,547) 6,114,547 - - - - - -
-
Recapitalisation on reverse takeover** (235,164) - - (361,596) - (65) 65 -
104,542 256,990 (126,432)
Share-based payment charge** - - - 1,344,441 - - 1,344,441 - 1,344,441 - 1,344,441
Exchange differences relating to translation of foreign currency subsidiary - - - - 3,200 3,200 - 3,200 - 3,200
-
Loss for the period - - - - - - - (470,197) (470,197) 24,233 (445,964)
Balance at 30 September 2024 541,295 256,990 - (4,784,117) 6,114,547 3,200 1,333,630 4,402,200 6,534,115 168,689 6,702,804
* The share capital of the comparatives has been restated to reflect the
nominal value per share of the legal parent, MOH Nippon.
**See note 5 for further details on the movement in reserves for the reverse
acquisition transaction.
CONSOLIDATED CASH FLOW STATEMENT
For the six months ended 30 September 2024
Six months to 30 September 2024 Six months to 30 September 2023 Year ended
31 March 2024
Unaudited Unaudited
Unaudited
JPY '000 JPY '000 JPY '000
Cash flows from operating activities
Profit for the period 235,105 2,156,371 3,173,694
Adjustments for:
Finance income (7,726) - -
Depreciation and amortization 17,195 9,792 18,828
Share based payments 1,344,441 - -
Lease finance charge 1,215 272 501
Tax payments (681,068) (664,356) (1,214,945)
Operating cash flow before working capital 909,162 1,502,079 1,978,078
movements
Decrease/(increase) in trade and other receivables 504,452 (149,721) (599,018)
(Increase)/decrease in amounts due from related parties (8,333,218) 33,855 1,692,928
(Decrease)/increase in trade and other payables (excluding share issue costs) (1,195,615) 761,136 1,260,958
Increase/(decrease) in amounts due to related parties 1,210,096 (376,443) 2,085,950
Net cash flows from operating activities (6,905,123) 1,770,906 6,418,896
Cash flows from investing activities
Guarantee deposits 300,000 (94) 500,100
Purchase of property, plant and equipment (1,415) (2,525) (17,420)
ROU asset/liability (17,153) (8,613) (405)
Cash acquired on reverse acquisition 252,529 - -
Net cash inflows from investing activities 533,961 (11,232) 482,275
Cash flows from financing activities
Interest received 7,726 - -
Net cash inflows from financing activities 7,726 - -
Net increase in cash and cash equivalents (6,363,436) 1,759,674 6,901,171
Effect of foreign exchange differences 3,200
Cash and cash equivalents at beginning of period 7,250,522 349,351 349,351
Cash and cash equivalents at end of period 890,286 2,109,025 7,250,522
NOTES TO THE INTERIM FINANCIAL STATEMENTS
For the six-months ended 30 September 2024
1. About MOH Nippon Plc
MOH Nippon Plc, formerly Bowen Fintech Plc, is a public limited company
incorporated in England and Wales and domiciled in the United Kingdom (company
number: 13349097). It is a public company listed on the Official List of the
Financial Conduct Authority and which is admitted to trading on the Main
Market for listed securities of the London Stock Exchange. The registered
address is 71-75 Shelton Street, Covent Garden, London, United Kingdom, WC2H
9JQ.
In the period up to 19 August 2024, the activity of the Company was the
pursuit of opportunities for investment in the technology innovation market.
On 19 August 2024, the Company completed the acquisition of MOH through the
issuing of 229,779,093 new ordinary shares.
These consolidated interim financial statements ("interim financial
statements") as at and for the six months ended 30 September 2024 comprise the
Company and its subsidiary (together referred to as the "Group").
The companies in the Group at 30 September 2024 are:
Entity Shareholding
MOH Nippon Plc (formerly Bowen Fintech Plc)
Minnadeooyasan-Hanbai Co. Ltd 97.41% subsidiary of MOH Nippon Plc
2. Basis of preparation
These interim financial statements and accompanying notes have neither been
audited nor reviewed by the auditor, do not constitute statutory accounts
within the meaning of Section 434 of the Companies Act 2006 and do not include
all the information and disclosures required in annual statutory financial
statements. They should be read in conjunction with the Company's Annual
Report and Accounts for the year ended 30 April 2024, which are available on
the Company's website-www.mohnippon.com (http://www.mohnippon.com) . Those
statutory accounts were approved by the Board of Directors on 22 August 2024
and have been filed with Companies House. The report of the auditors in those
accounts was unqualified.
The comparative interim information for Minnadeooyasan-Hanbai Co. is available
from the Bowen Fintech Plc Prospectus dated 31 July 2024 (which is available
on the Group's website). Detailed financial information for MOH can be found
at www.minnadeooyasan.co.jp (http://www.minnadeooyasan.co.jp) . Although the
accounts for the year ended 31 March 2024 were audited, this is the first set
of consolidated accounts being prepared after the reverse acquisition and some
comparative balances were restated. Hence, the accounts for comparatives have
been shown as 'Unaudited'.
These interim financial statements were approved by the Board of Directors on
20 December 2024.
3. Accounting policies
The financial statements are presented in Japanese Yen which is the functional
currency of the operating company MOH and all values are rounded to thousands
of Japanese Yen (JPY).
Details of significant accounting policies are set out
below.
Reverse Takeover of Bowen Fintech Plc and creation of the MOH Nippon Plc group of companies
On 19 August 2024, the Company, then named Bowen Fintech Plc, became the legal
parent of Minnadeooyasan-Hanbai Co. Ltd. These interim financial statements
are presented as proforma to present the substance of a reverse takeover
transaction.
Bowen Fintech Plc was renamed MOH Nippon Plc.
The results for the six months ended, and as at 30 September 2024, are those
of Minnadeooyasan-Hanbai Co. Ltd from 1 April 2024 to 30 September 2024 with
the inclusion of the Bowen Fintech Plc at the acquisition date of 19 August
2024 through to 30 September 2024.
The comparative results for the six months ended, and as at 30 September 2023,
and also for, and as at 31 March 2024, represent the position of MOH prior to
the reverse acquisition.
This transaction is to be deemed outside the scope of IFRS 3 (Revised 2008)
and not considered a business combination because the Directors have made a
judgement that, prior to the transaction, Bowen Fintech Plc was not a business
under the definition of IFRS 3 Appendix A and the application guidance in IFRS
3.B7-B12 due to that Company being a company that had no processes or
capability for outputs (IFRS 3.B7). On this basis, the Directors have
developed an accounting policy for this transaction, applying the principles
set out in IAS 8.10-12, in that the policy adopted is:
§ relevant to the users of the financial information;
§ more representative of the financial position;
§ performance and cash flows of the Group;
§ reflects the economic substance of the transaction, not merely the legal
form; and
§ free from bias, prudent and complete in all material aspects.
The accounting policy adopted by the Directors applies the principles of IFRS
3 in identifying the accounting acquirer (Minnadeooyasan-Hanbai Co. Ltd) and
the presentation of the consolidated financial statements of the legal
acquirer (Bowen Fintech Plc) as a continuation of the accounting acquirer's
financial statements (Minnadeooyasan-Hanbai Co. Ltd).
This policy reflects the commercial substance of this transaction as:
§ the original majority shareholders of the Minnadeooyasan-Hanbai Co. Ltd
(KBC) is the most significant shareholder after the business combination and
readmission to the Official List of the Financial Conduct Authority and to
trading on the Main Market for listed securities of the London Stock Exchange
("Readmission"), owning 80.69 per cent. of the issued share capital; and
§ the executive management team of MOH became the executive management of MOH
Nippon Plc.
Accordingly, the following accounting treatment and terminology has been
applied in respect of the reverse acquisition:
§ the assets and liabilities of the legal subsidiary Minnadeooyasan-Hanbai
Co. Ltd are recognised and measured in the Group financial statements at the
pre-combination carrying amounts, without remeasurement to fair value;
§ the retained earnings and other equity balances recognised in the Group
financial statements reflect the retained earnings and other equity balances
of the Minnadeooyasan-Hanbai Co. Ltd immediately before the business
combination; and
§ the results of the period from 1 April 2024 to 19 August 2024 are those
of the Minnadeooyasan-Hanbai Co. Ltd only.
However, in the Group interim financial statements:
§ the equity structure presented, reflects the equity structure of the
legal parent (Bowen Fintech Plc), including the equity instruments issued
under the share-for-share exchange to effect the business combination; and
§ the cost of the combination has been determined from the perspective of
Minnadeooyasan-Hanbai Co. Ltd.
Transaction costs of equity transactions relating to the issue and Readmission
of the Company's ordinary shares, are accounted for as a deduction from equity
where they relate to the issue of new ordinary shares, and listing costs are
charged to the consolidated statement of comprehensive income. See note 5 for
further explanation.
Basis of consolidation
The consolidated financial statements incorporate the financial statements of
the Company and entities controlled by the Company (its subsidiary
undertaking). Where necessary, adjustments are made to the financial
statements of the subsidiary to bring its accounting policies in line with
those of the Group. All intra-Group transactions, balances, income and
expenses are eliminated on consolidation.
Subsidiaries are entities controlled by the Group. The Group "controls" an
entity when it is exposed to, or has rights to, variable returns from its
involvement with the entity and has the ability to affect those returns
through its power over the entity. The financial statements of the subsidiary
are included in the consolidated financial statements from the date on which
control commences until the date on which control ceases.
Non-controlling interests are measured initially at their proportionate share
of the legal acquiree's identifiable net assets at the date of acquisition.
Going concern
These consolidated unaudited interim financial statements have been prepared
on a going concern basis, which assumes that the Group will continue in
operational existence for the foreseeable future.
In assessing whether the going concern assumption is appropriate, the
Directors have taken into account all relevant information about the current
and future position of the Group, including the current level of resources.
At 30 September 2024 the Group had JPY 890 million of cash and net assets of
JPY 6,703 million.
Having prepared budgets and cash flow forecasts covering the going concern
period which have been stress tested, the Directors believe the Group has
sufficient resources to meet its obligations for a period of at least 12
months from the date of approval of these financial statements.
Taking these matters into consideration, the Directors consider that the
continued adoption of the going concern basis is appropriate having prepared
cash flow forecasts for the coming 12 months. The financial statements do not
reflect any adjustments that would be required if they were not prepared under
a going concern basis.
Revenue and cost of sales recognition
Revenue is recognised in accordance with the requirements of IFRS 15 'Revenue
from Contracts with Customers'.
MOH recognises revenue at the amount to which it expects to be entitled when
control of the real estate or services is transferred to its customers.
Control is generally transferred when MOH has a present right to payment and
title and the significant risks and rewards of ownership of products or
services are transferred to its customers.
MOH's main business activity is operating as a funding platform that
facilitates and arranges real estate crowdfunding in Japan. MOH's revenue
consists of fundraising commission fee and income from real estate joint
development. For the fundraising commission fee, control is transferred when
customers sign the agreement, and funds are subsequently transferred by the
customers. For revenue from real estate joint development, control is
transferred on the effective date of the transaction contract for real estate.
Payments for fundraising commission fee and real estate joint development
business are collected within a short period following the transfer of control
or the commencement of the delivery of services, as applicable.
Cost of sales related to delivered real estate, including land development
costs, and building construction costs are recognised as cost of sales as
incurred.
Financial instruments
Financial assets and liabilities are recognised in the statement of financial
position when the Group becomes a party to the contractual provisions of the
instrument. The Group's financial instruments comprise cash, trade and other
receivables, trade and other payables, and lease liabilities.
Trade and other receivables
Trade and other receivables are initially measured at fair value, net of
direct transaction costs and subsequently measured at amortised cost or fair
value, depending on the classification of the financial assets.
The cost is reduced by impairment losses. Any interest income, foreign
exchange gains and losses and impairment are recognised in profit or loss. Any
gain or loss on derecognition is recognised in profit or loss.
The Group will write-off financial assets, either in their entirety or a
portion thereof, if there is no reasonable expectation of its recovery. A
write-off constitutes a derecognition of a financial asset.
Cash and cash equivalents
The Group manages short-term liquidity through the holding of cash. Only
deposits that are readily convertible into cash with maturities of three
months or less from inception, with no penalty of lost interest, which are
subject to an insignificant risk of changes in value, are shown as cash and
cash equivalents.
Impairment of financial assets
An impairment loss is recognised for the expected credit losses on trade
receivables and other financial assets when there is an increased probability
that the counterparty will be unable to settle an instrument's contractual
cash flows on the contractual due dates, a reduction in the amounts expected
to be recovered, or both. For trade receivables, the Group has applied the
simplified approach in IFRS 9 to measure the loss allowance at lifetime ECL.
The probability of default and expected amounts recoverable are assessed using
reasonable and supportable past and forward-looking information that is
available without undue cost or effort.
Financial liabilities and equity
Financial liabilities are contractual obligations that requires an entity to
deliver cash, another financial asset, or exchange financial instruments under
potentially unfavourable conditions.
Trade and other payables
Trade and other payables are initially measured at fair value, net of direct
transaction costs and subsequently measured at amortised cost.
Equity
An equity instrument is any contract that evidences a residual interest in the
assets of the Company after deducting all of its liabilities. Equity
instruments issued by the Company are recorded at fair value on initial
recognition net of transaction costs.
Equity comprises the following:
§ Called up share capital represents the nominal value of the equity
shares.
§ Merger Relief Reserve is a statutory, non-distributable reserve arising
when conditions set out in section 612 of the Companies Act 2006 occur and
relate to the share-premium from shares issued to acquire
Minnadeooyasan-Hanbai Co. Ltd.
§ Retained earnings/ losses represents accumulated net gains and losses
from incorporation recognised in the Statement of Comprehensive Income.
§ Reverse Acquisition Reserve includes the accumulated losses incurred
prior to the reverse acquisition and the share capital and share premium of
Bowen Fintech Plc (renamed MOH Nippon Plc) at acquisition; the value of the
shares issued to acquire all of the share capital of Minnadeooyasan-Hanbai Co.
Ltd; as well as the reverse acquisition share-based payment expense.
§ Non-controlling Interest represents the accumulated net gains and losses
of Minnadeooyasan-Hanbai Co. Ltd. attributable to the minority shareholders.
Right of use leases
Right of use assets
The Group recognises right-of-use assets at the commencement date of the lease
(i.e. the date the underlying asset is available for use). Right-of-use assets
are measured at cost, less any accumulated depreciation and impairment losses,
and adjusted for any remeasurement of lease liabilities. The cost of
right-of-use assets includes the amount of lease liabilities recognised,
initial direct costs incurred, and lease payments made at or before the
commencement date less any lease incentives received.
Depreciation of Right Of Use Assets
The right-of-use asset is depreciated on a straight-line basis over the
shorter of the lease term and the estimated useful lives of the assets. Term
used for the reporting period, is as below-
§ Leasehold property - 3 to 9 years
§ Leased plant and equipment - over 5 to 6 years
In addition, the right-of-use asset is periodically reduced by impairment
losses, if any, and adjusted for certain remeasurements of the lease
liability.
Lease liabilities
At the commencement date of the lease, the Group recognises lease liabilities
measured at the present value of lease payments to be made over the lease
term. The lease payments include fixed payments (including in substance fixed
payments) less any lease incentives receivable, variable lease payments that
depend on an index or a rate and amounts expected to be paid under residual
value guarantees.
In calculating the present value of lease payments, the Group uses the
incremental borrowing rate at the lease commencement date. After the
commencement date, the amount of lease liabilities is increased to reflect the
accretion of interest and reduced for the lease payments made. The carrying
amount of lease liabilities is remeasured if there is a modification, a change
in the lease term, a change in the lease payments (e.g. changes to future
payments resulting from a change in an index or rate used to determine such
lease payments) or a change in the assessment of an option to purchase the
underlying asset.
Lease payments are allocated between principal and finance cost. The finance
cost is charged to profit or loss over the lease period.
Short-term leases and leases of low-value assets
The Group has elected not to recognise right-of-use assets and lease
liabilities for leases of low-value assets and short-term leases (of less than
12 months) (including IT equipment). The Group recognises the lease payments
associated with these leases as an expense on a straight-line basis over the
lease term.
Property, plant and equipment
Recognition and measurement
Property, plant and equipment are measured at cost, which includes capitalised
borrowing costs, less accumulated depreciation and any accumulated impairment
losses. If significant parts of an item of property, plant and equipment have
different useful lives, then they are accounted for as separate items (major
components) of property, plant and equipment.
Any gain or loss on disposal of an item of property, plant and equipment is
recognised in profit or loss.
Depreciation
Depreciation is calculated to write off the cost of items of property, plant
and equipment less their estimated residual values using the straight-line
method over their estimated useful lives and is generally recognised in profit
or loss.
The estimated useful lives of property, plant and equipment for current and
comparative periods are as follows:
§ Buildings - 47 years
§ Plant and equipment - 10 years
§ Furniture and fixtures - 3 to 15 years
Non-current assets are reviewed for impairment whenever events or changes in
circumstances indicate that the carrying amount may not be recoverable. An
impairment loss is recognised for the amount by which the asset's carrying
value exceeds its recoverable amount. The recoverable amount is the higher of
an asset's fair value less costs to sell and value in use. Value in use is
based on the present value of the future cash flows relating to the asset and
is determined over periods which are deemed to appropriately reflect the
minimum expected period that the cash generating unit will operate for.
4. Use of judgements and estimates
In preparing the interim financial statements, management has made judgements
and estimates that affect the application of the Group's accounting policies
and the reported amounts of assets, liabilities, income, expenses,
shareholders' equity and reserves. Actual results may differ from these
estimates. Estimates and underlying assumptions are reviewed on an ongoing
basis. Revisions to estimates are recognised prospectively.
In the process of applying the Group's accounting policies, management has
made the following judgements, which have the most significant effect on the
amounts recognised in the interim financial statements:
Reverse Acquisition Accounting
The MOH Nippon Plc Group of companies was formed by Minnadeooyasan-Hanbai Co.
Ltd reverse-acquiring Bowen Fintech Plc (a "reverse takeover") on 19 August
2024. Bowen Fintech Plc was then renamed MOH Nippon Plc. The board used
judgment in applying Reverse Acquisition Accounting principles and used
significant estimates and assumptions as to the share price to value the
consideration shares issued by Bowen Fintech Plc to the owners of
Minnadeooyasan-Hanbai Co. Ltd. Further details are in note 5.
5. Reverse Acquisition of Minnadeooyasan-Hanbai Co. Ltd
On 19 August 2024, Bowen Fintech Plc (subsequently renamed MOH Nippon Plc)
acquired through a share for share exchange, 97.41% of the share capital of
Minnadeooyasan-Hanbai Co. Ltd, whose primary business activity revolves around
serving as a funding platform that facilitates and arranges real estate
crowdfunding activities in Japan.
Although the transaction resulted in MOH becoming a subsidiary of the Company,
the transaction constitutes a reverse acquisition, as the previous
shareholders of Minnadeooyasan-Hanbai Co. Ltd own a substantial majority of
the ordinary shares of the Company and the executive management of
Minnadeooyasan-Hanbai Co. Ltd became the executive management of Bowen Fintech
Plc (renamed MOH Nippon Plc).
In substance, the shareholders of Minnadeooyasan-Hanbai Co. Ltd acquired a
controlling interest in Bowen Fintech Plc and the transaction has therefore
been accounted for as a reverse acquisition. As Bowen Fintech Plc's activities
prior to the acquisition were purely the maintenance of its listing, managing
cash payments to suppliers towards completion of the reverse acquisition and
satisfying filing obligations, it did not meet the definition of a business in
accordance with IFRS 3.
Accordingly, this reverse acquisition does not constitute a business
combination and was accounted for in accordance with IFRS 2 "Share-based
Payments" and associated IFRIC guidance.
Although, the reverse acquisition is not a business combination, the Company
has become a legal parent and is required to apply IFRS 10 and prepare
consolidated financial statements. The Directors have prepared these financial
statements using the reverse acquisition methodology, but rather than
recognising goodwill, the difference between the equity value given up by the
Minnadeooyasan-Hanbai Co. Ltd's shareholders and the share of the fair value
of net assets gained by the Minnadeooyasan-Hanbai Co. Ltd shareholders is
charged to the statement of comprehensive income as a cost of lising on
reverse acquisition.
In accordance with reverse acquisition accounting principles, these
consolidated financial statements represent a continuation of the consolidated
statements of Minnadeooyasan-Hanbai Co. Ltd and include:
a. the assets and liabilities of Minnadeooyasan-Hanbai Co.
Ltd at their pre- acquisition carrying value amounts and the results for the
periods presented; and
b. the assets and liabilities of the Company as at 19 August
2024 and its results from the date of the reverse acquisition (19 August 2024)
to 30 September 2024.
On 19 August 2024, Bowen Fintech Plc (renamed MOH Nippon Plc) issued
229,779,093 ordinary shares to acquire 97.41% of the share capital of
Minnadeooyasan-Hanbai Co. Ltd at a deemed issue price of £0.15 per share.
On consolidation and presentation of the Group's financial position,
performance and cash flows, Minnadeooyasan-Hanbai Co. Ltd, was treated as the
accounting acquirer, and the legal parent company Bowen Fintech Plc (renamed
MOH Nippon Plc), was treated as the accounting acquiree.
The fair value of the ordinary shares deemed to have been issued by
Minnadeooyasan-Hanbai Co. Ltd was calculated at JPY 1,568 million (£8.25
million) based on an assessment of the purchase consideration for a 100%
holding of Bowen Fintech Plc (renamed MOH Nippon Plc) on 19 August 2024.
The fair value of the net assets of Bowen Fintech Plc (renamed MOH Nippon Plc)
at acquisition was as follows:
JPY '000s
Cash and equivalents 252,529
Other assets 11,235
Accounts payable and other liabilities (40,084)
Net assets 223,680
The difference between the deemed cost JPY 1,568 million and the fair value of
the net assets assumed per above of JPY 223.68 million resulted in JPY 1,344
million being expensed to the income statement with a corresponding credit to
the reverse acquisition reserve in accordance with IFRS 2, Share Based
Payments, reflecting the economic cost to Minnadeooyasan-Hanbai Co. Ltd
shareholders of forming a quoted entity.
The professional fees incurred by the Group for the reverse acquisition
transaction, in the period were JPY 83 million, and they were expensed to the
income statement.
The ReverseAcquisition Reservewhich arose from the reverse takeover is made up
as follows:
Reverse
Acquisition Reserve
Note JPY '000s
Pre-acquisition total net assets of Bowen Fintech Plc 1 223,680
Investment in Minnadeooyasan-Hanbai Co. Ltd 2 (6,551,300)
Charge
Reverse acquisition expense 3 1,344,441
Recapitalisation of Bowen Fintech share capital at acquisition, to share 4 (104,541)
capital of MOH Nippon Plc
Recapitalisation of Bowen Fintech share premium at acquisition, to Share 5 (256,990)
premium
Recapitalisation of ordinary share capital of MOH less Non-controlling 6 94,975
interest
Recapitalisation of preference share capital of MOH less Non-controlling 7 2,435
interest
Recapitalisation of other components of equity of MOH less Non-controlling 8 463,183
interest
(4,784,117)
1. Recognition of pre-acquisition equity of Bowen Fintech Plc
(renamed as MOH Nippon Plc) as at 19 August 2024.
2. The value of the ordinary shares issued by the Company in
exchange for 97.41% share capital of Minnadeooyasan-Hanbai Co. Ltd.
3. The reverse acquisition expense represents the difference
between the value of the equity issued by the Company, and the deemed
consideration given by Minnadeooyasan-Hanbai Co. Ltd to acquire the Company.
4. Recapitalisation of share capital of Bowen Fintech Plc
(renamed as MOH Nippon Plc), before the issue of new ordinary shares-
55,000,000 ordinary shares @ £0.01 per share, equivalent to JPY 104.541
million.
5. Recapitalisation of share premium of Bowen Fintech Plc
(renamed as MOH Nippon Plc), before the issue of new ordinary shares-
£1,352,043, equivalent to JPY 256.990 million.
6. Recapitalisation of ordinary share capital of
Minnadeooyasan-Hanbai Co. Ltd, excluding the share of non-controlling
interest.
7. Recapitalisation of preference share capital of
Minnadeooyasan-Hanbai Co. Ltd, excluding the share of non-controlling
interest.
8. Recapitalisation of other components of equity of
Minnadeooyasan-Hanbai Co. Ltd, excluding the share of non-controlling
interest.
6. Revenue and cost of sales
The Group recorded revenue in the 6 months ended 30 September 2024 of JPY
4,009 million (6 months ended 30 September 2023: JPY 4,930 million; year ended
31 March 2024: JPY 11,107 million). All revenue was generated in Japan.
Six months to 30 September 2024 Six months to 30 September 2023 Year ended
31 March 2024
Unaudited Unaudited Unaudited
JPY '000 JPY '000 JPY '000
Revenues
Service over time
Revenues from commission 1,909,091 3,113,571 7,404,500
Service at a point in time
Revenues from real estate business JV 2,100,000 1,816,250 3,702,250
Total revenue 4,009,091 4,929,821 11,106,750
Cost of revenues
Purchases-Real estate business (1,800,000) (30,330) (2,647,845)
Total COS (1,800,000) (30,330) (2,647,845)
Gross Profit 2,209,091 4,899,491 8,458,905
7. (Loss)/Earnings per share
Six months to 30 September 2024 Six months to 30 September 2023 Year ended
31 March 2024
Unaudited Unaudited Unaudited
JPY '000 JPY '000 JPY '000
(Loss)/ Income after tax attributable to equity holders (470,197) 1,492,015 2,076,806
Basic weighted average number of common shares outstanding 242,703 327,945 327,945
Diluted weighted average number of common shares outstanding 242,703 336,345 336,345
Basic (loss)/earnings per share (1.9373) 4.5496 6.3328
Diluted (loss)/earnings per share (1.9373) 4.4360 6.1746
Basic earnings per share is calculated by dividing the loss/profit after tax
attributable to the owners of the Parent company, by the weighted average
number of ordinary shares in issue during the year. Diluted earnings per share
is calculated by adjusting the weighted average number of ordinary shares
outstanding to assume conversion of all potential dilutive ordinary shares.
The calculation of earnings per share is based on the following earnings and
number of ordinary shares.
In calculating the weighted average number of ordinary shares outstanding (the
denominator of the earnings per share calculation) during the period in which
the reverse acquisition occurs:
§ The number of ordinary shares outstanding from the beginning of that
period to the acquisition date shall be computed, on the basis of the weighted
average number of ordinary shares of the legal acquiree (accounting acquirer)
outstanding during the period multiplied by the exchange ratio established in
the merger agreement; and
§ The number of ordinary shares outstanding from the acquisition date to
the end of that period shall be the actual number of ordinary shares of the
legal acquirer (the accounting acquiree) outstanding during that period.
The basic earnings per share for each comparative period beforethe acquisition
date presented in the consolidated financial statements following a reverse
acquisition shall be calculated by dividing:
§ the profit or loss of the legal acquiree attributable to ordinary
shareholders in each of those periods by
§ the legal acquiree's historical weighted average number of ordinary
shares outstanding multiplied by the exchange ratio established in the
acquisition agreement.
The weighted average number of ordinary shares for the purpose of calculating
the basic and diluted measures is the same.
8. Other non-current assets
As at 30 September 2024 As at 30 September 2023 As at
31 March 2024
JPY '000 JPY '000 JPY '000
Unaudited Unaudited Unaudited
Right of use assets 80,868 31,586 22,745
Software 2,895 6,390 3,876
Contribution 130 130 130
Guarantee deposits 1,002,163 1,802,357 1,302,163
Membership rights 8,875 8,875 8,875
1,094,931 1,849,338 1,337,789
9. Share capital
As at
Common Stock Share Capital
JPY '000
30 September 2023 229,779,093 436,753
31 March 2024 229,779,093 436,753
30 September 2024 284,779,093 541,295
10. Related party transactions
TSIB (Toshi-Souken Invest Bank Inc)
TSIB is a wholly owned subsidiary of Kyosei Bank Co., Ltd who is the majority
shareholder of the MOH Group.
Transactions entered into with TSIB, along with balances owed from and to the
related party are as below-
As at 30 September 2024 As at 30 September 2023 As at
31 March 2024
Unaudited Unaudited Unaudited
JPY '000 JPY '000 JPY '000
Transactions during the period
Commission income 1,909,091 3,113,571 7,404,500
Real estate sales - 1,816,250 3,702,250
Guarantee deposit - - 1,000,000
Payments for real estate joint development 4,500,000 - -
Reimbursed expenses 52,342 140,309 1,512,750
Loan 3,007,726 - -
Capital loan - - 5,078,000
Total 9,469,159 5,070,130 18,697,500
Balances outstanding at each period end
Balance owed by the related party 6,618,324 2,350,919 674,094
Balance owed to the related party 3,803,526 130,330 2,591,603
In September 2024, MOH disposed of the Soemon-cho project, a joint real estate
development project in Osaka, Japan with TISB to TSIF (both KBC group
companies and therefore related parties), and generated a revenue of
commission income from TSIB of JPY2.1 billion. A receivable of JPY1.9 billion
is included in "Amounts due from related parties" at 30 September 2024.
In June 2024, MOH loaned JPY3 billion to TSIB at an interest rate of 1.59% per
annum. TSIB repaid the loan with interest in August 2024. Interest income of
JPY7.7 million was earned for the six months ended 30 September 2024.
In July 2024, MOH made a deposit of JPY1.5 billion to TSIB for the initial
investment in a real estate development project with TSIB in Saipan. In August
2024, MOH made a deposit of JPY3 billion to TSIB for the Soemon-cho project in
Osaka, Japan. These deposits of JPY4.5 billion are included in "Amounts due
from related parties" at 30 September 2024.
Reimbursed expenses represent transactions between MOH and TSIB in relation to
shared services.
TSIF (Toshi-Souken Invest Fund Inc)
TSIF is a wholly owned subsidiary of TSIB, which is the subsidiary of Kyosei
Bank Co., Ltd ("KBC") which is the majority shareholder of the MOH group of
companies.
Transactions entered into with TSIF, along with balances owed from and to the
related party are as below-
As at 30 September 2024 As at 30 September 2023 As at
31 March 2024
JPY '000 JPY '000 JPY '000
Transactions during the period
Real estate sales 2,100,000 - -
Reimbursed expenses 338,478 333,439 746,259
2,438,478 333,439 746,259
Balances outstanding at each period end
Balance owed by the related party 2,464,097 60,822 66,067
Balance owed to the related party 245 245 216
In September 2024, MOH disposed of the Soemon-cho project, a joint real estate
development project in Osaka, Japan with TISB to TSIF, and generated a revenue
for real estate sales of JPY2.1 billion. A receivable of JPY2.1 billion is
included in "Amounts due from related parties" at 30 September 2024.
Reimbursed expenses represent transactions between MOH and TSIF in relation to
shared services.
KBC (Kyosei Bank Co., Ltd)
Kyosei Bank Co., Ltd is the majority shareholder of the MOH group of
companies.
Transactions entered into with KBC, along with balances owed from and to the
related party are as below-
As at 30 September 2024 As at 30 September 2023 As at
31 March 2024
JPY '000 JPY '000 JPY '000
Transactions during the period
Reimbursed expenses 13,950 54,708 79,507
Loans borrowed - 40,000 40,000
Capital loan - - 72,838
13,950 94,708 192,345
Balances outstanding at each period end
Balance owed by the related party 4,315 850 13,355
Balance owed to the related party 63 769 1,919
Reimbursed expenses represent transactions between MOH and KBC in relation to
shared services.
11. Commitments and Contingencies
At 30 September 2024 the Group had no commitments and contingencies to report.
12. Subsequent events
On 30 September 2024, the Company announced a change of accounting reference
date- The accounting reference period ending 30 April 2025 was shortened so as
at to end on 31 March 2025.
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