香港交易及結算所有限公司及香港聯合交易所有限公司（「聯交所」）對本公告的內容概不 負責，對其準確性或完整性亦不發表任何聲明，並明確表示概不就因本公告全部或任何 部份內容而產生或因倚賴該等內容而引致的任何損失承擔任何責任。 Snack Empire Holdings Limited 快 餐 帝 國 控 股 有 限 公 司 （於開曼群島註冊成立的有限公司） （股份代號：1843） 截至二零二三年九月三十日止 六個月之中期業績公告 快餐帝國控股有限公司（「本公司」）之董事會（分別為「董事」及「董事會」）欣然宣佈本公司 及其附屬公司截至二零二三年九月三十日止六個月之未經審核簡明綜合財務業績。本公 告列載本公司截至二零二三年九月三十日止六個月之中期報告全文，並符合聯交所證券 上市規則（「上市規則」）有關中期業績初步公告須包括的資料的相關規定。本公司截至二 零二三年九月三十日止六個月之中期報告的印刷版將適時發送予本公司股東，並將按照 上市規則所規定的方式於聯交所網站www.hkexnews.hk及本公司網站www.snackemp.com 可供查閱。 承董事會命 快餐帝國控股有限公司 主席及獨立非執行董事 ...

Business Operations - The company operates 238 stores across Singapore, Malaysia, Indonesia, the United States, Egypt, and Cambodia, with 16 self-operated stores in Singapore and 21 in West Malaysia[12]. - Revenue has rebounded to pre-COVID-19 levels in Malaysia following the lifting of restrictions, with an increase of 5 stores compared to the previous year[13]. - The company has successfully secured a location in a hospital in Malaysia, which commenced operations in January 2023[12]. - The company plans to expand its presence in ASEAN countries through franchise exhibitions to attract potential franchisees[7]. - A collaboration with Chef Roboto aims to develop customized frying robots to improve operational efficiency and customer service[7]. Financial Performance - Total revenue increased from approximately 24.1 million SGD in 2022 to about 26.4 million SGD in 2023, representing a growth of approximately 10%[17]. - Sales from self-operated stores in Malaysia increased by 3.0 million SGD, a growth of 38%, due to the lifting of movement restrictions[17]. - Revenue from franchisees in Indonesia and Northern California, USA, increased by approximately 0.6 million SGD (28%) and 0.2 million SGD (41%) respectively, attributed to the easing of COVID-19 restrictions[17]. - Gross profit for the year was approximately 16.1 million SGD, an increase of about 7.0% from 15.1 million SGD in 2022[21]. - The cost of goods sold increased in line with revenue growth, maintaining a gross margin of approximately 61-63%[20]. Employee and Talent Management - Employee costs rose from approximately 7.4 million SGD in 2022 to about 8.6 million SGD in 2023, reflecting a need to attract and retain talent in a competitive labor market[24]. - The gender ratio of employees is 1.2 females for every male employee, indicating a commitment to gender diversity in the workforce[69]. - The company has implemented air quality control practices in its restaurants to ensure a healthy working environment[159]. - The employee retention strategy includes regular reviews of compensation structures to maintain competitiveness in the labor market[165]. - A total of 176 employees participated in the training program, with 45.5% being male and 54.5% female[178]. Corporate Governance - The company has maintained high levels of corporate governance, ensuring the protection of shareholder rights and adherence to governance codes[56]. - The board of directors held five meetings and one annual general meeting during the year, with all executive directors attending all meetings[61]. - The company has appointed new independent directors to enhance its governance structure and oversight capabilities[49][51]. - The board's commitment to corporate governance is reflected in its adherence to mandatory disclosure requirements and best practices[56]. - The company has established various committees to oversee different responsibilities, ensuring effective management and compliance[58]. Environmental, Social, and Governance (ESG) Practices - The company is committed to enhancing its environmental, social, and governance (ESG) practices to create sustainable value for stakeholders[39]. - The company has established a governance framework for environmental, social, and governance (ESG) strategies, with a dedicated working group to assess ESG performance[130]. - Key performance indicators related to ESG are disclosed with a focus on transparency and accountability[132]. - The company is committed to sustainable development and aims to implement sustainability measures across all operational aspects[25]. - The report adheres to the guidelines set by the Hong Kong Stock Exchange for ESG reporting, ensuring compliance with relevant regulations[128]. Customer Feedback and Quality Control - The group received and processed a total of 142 customer complaints in its restaurants in Singapore and Malaysia during the reporting period, averaging 3.7 complaints per store per year[39]. - Customer feedback primarily related to long wait times, service attitude, inaccurate order processing, and dissatisfaction with food taste and quality[39]. - The company has established a food quality control system and safety guidelines, ensuring compliance in its outlets[191]. - The company has not reported any violations related to child labor or forced labor laws during the reporting period[181]. - The company maintains strict supply chain management, ensuring quality control and compliance with safety standards[184]. Financial Management and Capital Structure - Cash and cash equivalents decreased to approximately 23.5 million SGD from 28.4 million SGD in the previous year, a reduction of about 4.9 million SGD[26]. - The current ratio was approximately 5.7 times, down from 6.6 times in the previous year, indicating a decrease in liquidity[26]. - The debt-to-equity ratio was approximately 18% as of March 31, 2023, compared to 15% in the previous year[27]. - The company raised approximately 13.0 million SGD (equivalent to 74.8 million HKD) from the issuance of 200,000,000 shares at HKD 0.65 per share[30]. - The company has no significant contingent liabilities as of March 31, 2023[34]. Training and Development - The total training hours for employees amounted to 2,677 hours, averaging 15.21 hours per employee[178]. - Franchisee training included onboarding for new franchisees and ongoing training for existing ones, totaling 1,609 hours for 60 franchisee employees[179]. - The average training hours for male employees were 14.75 hours, while female employees averaged 15.59 hours[178]. - The company plans to provide comprehensive training for all employees related to operations, management, accounting, finance, legal compliance, and research and development[69]. - All directors participated in continuous professional development to enhance their knowledge and skills, with training covering various relevant topics[79].

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負責，對其 準確性或完整性亦不發表任何聲明，並明確表示概不就因本公告全部或任何部份內容而 產生或因倚賴該等內容而引致的任何損失承擔任何責任。 Snack Empire Holdings Limited 快 餐 帝 國 控 股 有 限 公 司 （於開曼群島註冊成立的有限公司） （股份代號：1843） 截至二零二三年三月三十一日止年度 之全年業績公告 本年度財務摘要 • 收入約為26,405,000坡元（二零二二年年度：24,051,000坡元） • 毛利約為16,116,000坡元（二零二二年年度：15,060,000坡元） • 本公司權益持有人應佔年內溢利約為1,843,000坡元（二零二二年年度：2,828,000坡 元） • 每股基本及攤薄盈利約為每股0.2坡仙（二零二二年年度：每股0.4坡仙） ...

Revenue and Profitability - The company's total revenue increased from approximately 11,791 thousand SGD in the corresponding period to about 13,845 thousand SGD, representing a growth of approximately 17%[12] - Revenue for the period reached SGD 13,845 million, an increase of 17.4% compared to SGD 11,791 million in the previous period[72] - Gross profit increased to SGD 8,346 million, up 9.7% from SGD 7,606 million[72] - Net profit attributable to equity holders was SGD 1,777 million, representing a 4.8% increase from SGD 1,695 million[72] - The company reported a net profit attributable to equity holders of 1,666 thousand SGD for the six months ended September 30, 2022, compared to 1,704 thousand SGD for the same period in 2021, reflecting a slight decrease of 2.2%[120] Expenses and Costs - Total sales and distribution expenses grew by approximately 405 thousand SGD or 14.1%, mainly due to increased employee compensation and advertising expenses[16] - The company’s total employee benefits costs increased to 3,609 thousand SGD for the six months ended September 30, 2022, compared to 3,208 thousand SGD for the same period in 2021, reflecting an increase of 12.5%[118] - The average effective interest rate on borrowings is reported at 2.5%, compared to 1.3% in the previous period[130] Dividends - The company declared an interim dividend of 0.133 SGD per share, compared to no dividend in the corresponding period[21] - The company declared an interim dividend of 0.133 per share, totaling 1,066,000, compared to no dividend declared in the previous year[134] Financial Position - As of September 30, 2022, the total equity of the group was approximately SGD 25.5 million, down from SGD 28.9 million as of March 31, 2022[43] - The group's current assets were approximately SGD 27.4 million, while current liabilities were about SGD 4.1 million, resulting in a current ratio of approximately 6.7[43] - The group had outstanding bank borrowings of approximately SGD 2.1 million as of September 30, 2022, compared to SGD 2.2 million as of March 31, 2022[44] - The group held cash and cash equivalents of approximately SGD 24.1 million as of September 30, 2022, down from SGD 28.4 million as of March 31, 2022[44] - The debt-to-equity ratio of the group was approximately 16% as of September 30, 2022, compared to 15% as of March 31, 2022[46] Business Operations - Sales from retail stores in Malaysia increased by approximately 911 thousand SGD or 59%, attributed to the easing of COVID-19 restrictions and the opening of new stores in Indonesia[12] - Franchise sales to overseas franchisees increased significantly, contributing to overall revenue growth[12] - The overall sales of non-self-operated stores increased, leading to a rise in royalty fee income by approximately 149 thousand SGD or 44%[12] - The company remains cautious about ongoing challenges in the snack and beverage industry, particularly regarding rising costs and labor shortages[19] - The company plans to continue exploring potential business opportunities to improve overall profitability[20] Shareholder Information - As of September 30, 2022, the company has 800,000,000 issued shares, with Daniel Tay and Huang Zhidai each holding 600,000,000 shares, representing 75% ownership[56] - Daniel Tay and Huang Zhidai each have a 50% beneficial ownership in Qiaomai Limited, which holds 600,000,000 shares[61] - The company did not repurchase any of its listed securities during the review period[63] Governance and Compliance - The audit committee, consisting of three independent non-executive directors, reviewed the interim results and confirmed compliance with applicable accounting standards[68] - The company has adopted the corporate governance code and is committed to maintaining high standards of corporate governance[65] - No changes in director information have occurred since the last annual report date[64] - The company has confirmed that all directors complied with the securities trading code during the review period[67] Other Financial Metrics - Total assets decreased to SGD 33,205 million from SGD 37,130 million, a decline of 10.4%[78] - Cash and cash equivalents decreased to SGD 24,101 million from SGD 28,432 million, a reduction of 15.4%[95] - Operating cash flow generated was SGD 2,279 million, down from SGD 3,109 million, a decrease of 26.7%[91] - Total liabilities decreased to SGD 7,657 million from SGD 8,248 million, a decline of 7.2%[81] - The company reported a foreign exchange loss of SGD 111 million, compared to a gain of SGD 9 million in the previous period[72] Government Support - Other income from government subsidies decreased to approximately 73 thousand SGD, down from 496 thousand SGD in the corresponding period[17] - Government grants received were 73 thousand SGD for the six months ended September 30, 2022, a decrease of 85.3% from 496 thousand SGD in the same period of 2021[114]

Financial Performance - The company's revenue for the year ended March 31, 2022, was SGD 24,051,000, an increase of 12.5% compared to SGD 21,451,000 in the previous year[18]. - Sales from specialty and dining stores amounted to SGD 16,030,000, up from SGD 14,477,000, representing an increase of 10.8%[18]. - Franchise and licensed operators contributed SGD 6,470,000 in sales, compared to SGD 5,740,000, marking a growth of 12.7%[18]. - The group's total revenue increased from approximately 21.5 million SGD in 2021 to about 24.1 million SGD in 2022, representing a growth of approximately 12%[5]. - The group's gross profit for the year was approximately 15.0 million SGD, an increase of about 14.5% from approximately 13.1 million SGD in 2021[25]. - The total sales revenue from Singapore's self-operated stores increased due to the nature of takeaway services, with total revenue from Indonesia and the USA rising by approximately 0.9 million SGD (68%) and 0.3 million SGD (136%) respectively[5]. Operational Expansion - The company expanded its operations into East Malaysia through a franchise agreement, reflecting a strategic move to enhance market presence[15]. - The number of specialty and dining stores increased by 6 during the year, attributed to the easing of COVID-19 restrictions[15]. - The company remains optimistic about business prospects in Malaysia and Indonesia, despite ongoing challenges in the restaurant industry[9]. - The company plans to continue expanding both local and overseas markets while enhancing brand strength and shareholder value[40]. Cost Management - The company is focused on managing high costs and maintaining cash flow amid unpredictable COVID-19 conditions[9]. - Employee costs rose from approximately 6.4 million SGD in 2021 to about 7.4 million SGD in 2022, an increase of approximately 1.0 million SGD[27]. - Rental and related expenses increased by approximately 0.5 million SGD (16%) to about 2.4 million SGD due to new store openings and increased warehouse rent in Singapore[28]. - The cost of goods sold increased in line with revenue growth, maintaining a gross margin of approximately 61-63%[24]. Cash Flow and Financial Position - As of March 31, 2022, the group's cash and cash equivalents were approximately 28.4 million SGD, an increase of about 3.0 million SGD from 25.4 million SGD in 2021[29]. - The group recorded a debt-to-equity ratio of approximately 15% as of March 31, 2022, compared to 16% in the previous year[30]. - The net proceeds from the share issuance amounted to approximately 13.0 million SGD, with allocations for new store openings and technology upgrades planned for 2023 and 2024[32]. Corporate Governance - The company has maintained high standards of corporate governance to protect shareholder interests and ensure transparency and accountability[57]. - The board of directors held four meetings and one annual general meeting during the year, with all executive directors attending all meetings[62]. - The independent non-executive director, Mr. Ho, was appointed on August 27, 2021, and has attended three out of three board meetings since his appointment[62]. - The company has adopted and complied with all provisions of the corporate governance code during the year[58]. - The board consists of three independent non-executive directors, meeting the requirement that independent non-executive directors must account for at least one-third of the board members[13]. Risk Management - The group remains cautious about the unpredictable impacts of COVID-19 and other challenges facing the restaurant industry, such as high operating costs[39]. - The company is subject to various risks and uncertainties that could significantly impact its financial condition and operational performance[123]. - The company faces potential adverse impacts on its financial performance due to reliance on rental agreements for its self-operated stores, with rental costs constituting a major part of operational expenses[128]. - The company acknowledges that negative reviews from food critics can adversely affect its business and brand reputation[125]. Shareholder Relations - The board emphasizes the importance of transparent and timely communication with shareholders to build investor confidence[110]. - Shareholders can request a special general meeting if they hold at least 10% of the paid-up capital, and the meeting must be held within two months of the request[111]. - The company has adopted a dividend policy to distribute no less than 40% of net profit as dividends, subject to board discretion and shareholder approval[117]. - The company reported no final dividend for the fiscal year ending March 31, 2022[138]. Audit and Compliance - The independent auditor, Mazars LLP, was appointed to fill the vacancy left by the resignation of the previous auditor and will be proposed for reappointment at the 2022 annual general meeting[183]. - The independent auditor's report confirms that the consolidated financial statements of Fast Food Empire Holdings Limited accurately reflect the group's financial position as of March 31, 2022, in accordance with International Financial Reporting Standards[135]. - The audit committee reviewed the independence of external auditors and the appointment of external auditors[95]. - The audit committee reviewed the internal control review report and found the risk management and internal control systems to be effective and adequate[102].

0 Snack Empire Holdings Limited 快 餐 帝 國 控 股 有 限 公 司 (於聞曼群島註冊成立的有限公司) 股份代號：1843 2022 ឌ 期 E ME BE ME ME 目 錄 | --- | --- | |--------------------|-------| | | | | | | | | | | 公司資料 | 2 | | | | | 管理層討論及分析 | 3 | | 企業管治及其他資料 | 13 | | 簡明綜合全面收益表 | 18 | | --- | --- | --- | |-------|----------------------|-------| | | | | | | 簡明綜合財務狀況表 | 19 | | | 簡明綜合權益變動表 | 21 | | | 簡明綜合現金流量表 | 22 | | | 簡明綜合財務報表附註 | 24 | 2022 中期報告 2 公司資料 | --- | --- | |----------------------------------------------------------------------------------- ...

Store Operations and Expansion - The company operates a total of 227 stores, including 17 self-operated stores in Singapore and 120 non-self-operated stores in Indonesia, reflecting a decrease of 21 stores compared to the previous year due to pandemic-related restrictions[14] - The company plans to continue expanding its network of self-operated and non-self-operated stores in Singapore and West Malaysia, as well as renovating existing locations and enhancing its IT systems[9] - The company aims to expand into multiple overseas markets and strengthen marketing efforts to attract a diverse customer base[37] Sales and Revenue - Revenue sources include sales from stores, ingredient sales to franchisees, franchise fees, royalties, and advertising income[16] - Total revenue decreased from approximately 24.3 million SGD in 2020 to about 21.5 million SGD in 2021, representing a decline of approximately 12%[19] - Sales from franchisees decreased significantly, with a drop of about 2.6 million SGD or 66% from Indonesia and a decrease of about 2.5 million SGD or 22% from Malaysia[19] - A significant portion of the company's revenue is derived from franchising and licensing models, particularly in Singapore and West Malaysia[124] - The company may experience revenue fluctuations due to delays or cancellations of significant sales orders from franchisees[125] Financial Performance - Gross profit for the year was approximately 13.1 million SGD, down about 14% from 15.4 million SGD in 2020, primarily due to reduced sales volume caused by the COVID-19 pandemic[23] - The cost of goods sold decreased in line with revenue decline, maintaining a stable gross margin of 61-63%[22] - Employee costs increased from approximately 4.8 million SGD in 2020 to about 6.4 million SGD in 2021, an increase of about 1.6 million SGD to support expansion plans[25] - Cash and cash equivalents increased to approximately 25.4 million SGD in 2021 from about 21.6 million SGD in 2020, an increase of about 3.8 million SGD[27] - The current ratio was approximately 6.6 times in 2021, down from 7.0 times in 2020[27] Corporate Governance - The company has maintained compliance with all provisions of the corporate governance code during the year[54] - The board of directors is responsible for leading and controlling the company, ensuring objective decision-making in the best interest of the company[56] - The company emphasizes high levels of corporate governance to protect shareholder interests and ensure sustainable development[53] - The board regularly reviews and adheres to corporate governance policies to ensure compliance with the code[55] - The company has established various board committees with specific responsibilities to enhance governance practices[56] Risk Management and Challenges - The company maintains a cautious optimism regarding recovery from the pandemic, despite ongoing challenges and fluctuating infection rates in various countries[7] - The company is cautious about the ongoing impact of the COVID-19 pandemic and other market uncertainties on its operations and revenue[37] - The company faces risks related to potential negative reviews from food critics, which could adversely affect its business operations and brand reputation[124] - The company relies on major franchisees and licensed operators for revenue, and any disruption in these relationships could adversely affect financial performance[127] Shareholder and Stakeholder Engagement - The company expresses gratitude to stakeholders for their trust and support during challenging times[10] - The board emphasizes the importance of maintaining transparent and timely communication with shareholders to build investor confidence[107] - The company has implemented a policy for handling and disclosing inside information to ensure accuracy and timeliness of public disclosures[101] Audit and Financial Reporting - The independent auditor Mazars LLP was paid a total of 158,000 for annual audit services in the current year[97] - The audit committee reviewed the financial statements and the independence of external auditors, ensuring compliance with accounting standards and risk management[86] - The company’s financial statements have been audited and reviewed by the independent auditor, ensuring compliance with accounting principles[181] - The audit process involved identifying and assessing risks of material misstatement and designing appropriate audit procedures[199] Dividend Policy - The company has adopted a dividend policy, proposing to distribute no less than 40% of net profit as dividends, subject to board discretion and shareholder approval[115] - The company has implemented a review process for its dividend policy, with no guarantee of dividend payments in any specific period[116] - The company’s board will decide on the payment of dividends based on factors such as operational performance, cash flow, and capital requirements[115] - The company has no plans to declare any final dividends for the fiscal year[138] Share Options and Management - The total number of options that can be granted under the share option scheme is capped at 80 million shares, representing 10% of the total issued shares as of the report date[147] - The maximum rights granted to any qualified person cannot exceed 1% of the total issued shares unless approved by shareholders[148] - The exercise period for stock options is within ten years from the grant date, subject to early termination provisions[149]

[Company Information](index=3&type=section&id=Company%20Information) This section provides an overview of the company's governance structure, including its board of directors, key personnel, contact details, and listing information [Board of Directors and Key Personnel](index=3&type=section&id=Board%20of%20Directors%20and%20Key%20Personnel) This section lists the company's executive directors, independent non-executive directors, and the composition of the audit, remuneration, and nomination committees, specifying each committee's chairman - Executive Directors include Mr. Daniel Tay Kok Siong (Chairman) and Mr. Wong Chee Tat (Chief Executive Officer)[4](index=4&type=chunk) - Independent Non-executive Directors are Mr. Yeo Boon Hwee, Mr. Koh Boon Hwee, and Mr. Lim Wee Bin[4](index=4&type=chunk) - The Audit Committee is chaired by Mr. Lim Wee Bin, the Remuneration Committee by Mr. Koh Boon Hwee, and the Nomination Committee by Mr. Yeo Boon Hwee[4](index=4&type=chunk) [Company Contact and Registration Information](index=3&type=section&id=Company%20Contact%20and%20Registration%20Information) This section provides the company's principal places of business in Hong Kong and Singapore, registered office, principal bankers, independent auditor, compliance adviser, share registrar, and listing information - The principal place of business in Hong Kong is located at 57th Floor, The Center, 99 Queen's Road Central, Hong Kong[4](index=4&type=chunk) - The independent auditor is PricewaterhouseCoopers[4](index=4&type=chunk) - The company's shares are listed on the Main Board of The Stock Exchange of Hong Kong Limited, with stock code 1843[4](index=4&type=chunk) [Management Discussion and Analysis](index=4&type=section&id=Management%20Discussion%20and%20Analysis) This section reviews the Group's business and financial performance for the period, outlining key operational responses to the COVID-19 pandemic, financial results, future plans, and risk management strategies [Business Review](index=4&type=section&id=Business%20Review) During the six-month review period ended September 30, 2020, the global economy was severely impacted by the COVID-19 pandemic; the Group mitigated effects through online sales, new product development, rent rebates, and government subsidies - The COVID-19 pandemic impacted the Group's self-operated specialty stores and dine-in outlets in Singapore and Malaysia, affecting sales and overall profitability[6](index=6&type=chunk) - Group countermeasures included promoting online sales through food delivery providers, developing new products like bubble tea, seeking rent rebates and government grants, and encouraging non-critical employees to take annual leave[6](index=6&type=chunk) [Financial Review](index=5&type=section&id=Financial%20Review) The Group's total revenue decreased by 10.2% year-on-year to S$10,788 thousand, primarily due to reduced sales from franchisees/licensees and royalty income, despite growth in self-operated store sales, with significant declines in Indonesia and Malaysia due to lockdowns Total Revenue by Sales Segment for the Six Months Ended September 30 | Revenue Segment | 2020 (S$ thousand) | % of Total Revenue (2020) | 2019 (S$ thousand) | % of Total Revenue (2019) | | :------------------------------ | :----------------- | :------------------------ | :----------------- | :------------------------ | | Specialty Store Sales | 7,351 | 68.1% | 5,948 | 49.5% | | Franchisee/Licensee Sales | 2,736 | 25.4% | 4,573 | 38.1% | | Franchise Fees | 190 | 1.8% | 314 | 2.6% | | Advertising and Promotion Fees | 264 | 2.4% | 122 | 1.0% | | Royalty Fees | 247 | 2.3% | 1,051 | 8.8% | | **Total** | **10,788** | **100.0%** | **12,008** | **100.0%** | - Group total revenue decreased by approximately **10.2%** year-on-year, mainly due to reduced sales from franchisees and licensees and lower royalty income[10](index=10&type=chunk) - Total merchandise sales from self-operated specialty stores in Singapore increased, benefiting from their takeaway-focused nature aligning with customer preferences[11](index=11&type=chunk) - Merchandise sales to Indonesia and Malaysia fell by approximately **61%** and **37%** respectively, primarily due to government-imposed lockdown measures in both countries[10](index=10&type=chunk) [Gross Profit](index=6&type=section&id=Gross%20Profit) During the review period, the Group's cost of sales decreased in line with revenue, and the gross profit margin remained relatively stable at approximately 64% - Gross profit margin remained relatively stable at approximately **64%** during the review period[17](index=17&type=chunk) - Cost of goods sold decreased in line with the decline in revenue[17](index=17&type=chunk) [Selling and Distribution Expenses](index=6&type=section&id=Selling%20and%20Distribution%20Expenses) Selling and distribution expenses increased by 18.9% (S$430 thousand) year-on-year, primarily due to higher advertising, additional staff costs, rent, and depreciation of right-of-use assets, consistent with the Group's expansion plans - Selling and distribution expenses increased by **18.9%** (S$430 thousand), mainly due to higher advertising expenses, additional staff costs, rent expenses, and depreciation of related right-of-use assets[18](index=18&type=chunk) - The increase in expenses is part of the Group's expansion plan[18](index=18&type=chunk) [Administrative Expenses](index=6&type=section&id=Administrative%20Expenses) Administrative expenses increased by approximately 12.9% (S$370 thousand), mainly due to higher employee expenses - Administrative expenses increased by approximately **12.9%** (S$370 thousand), primarily due to higher employee expenses[19](index=19&type=chunk) [Other Income](index=6&type=section&id=Other%20Income) During the review period, the Group's other income significantly increased to S$906 thousand, primarily from government grants, compared to only S$7 thousand in the prior period - Other income significantly increased to **S$906 thousand**, primarily from government grants (compared to S$7 thousand in the prior period)[20](index=20&type=chunk) [Prospects](index=6&type=section&id=Prospects) The Group remains vigilant regarding the COVID-19 pandemic and market fluctuations; prolonged outbreaks or continued lockdown measures in operating countries will adversely affect its business and revenue - The Group remains vigilant regarding the COVID-19 pandemic and market fluctuations[21](index=21&type=chunk) - If the pandemic persists or lockdown measures continue in countries where the Group operates, its business and revenue will continue to be adversely affected[21](index=21&type=chunk) [Interim Dividend](index=7&type=section&id=Interim%20Dividend) The Board of Directors has resolved not to declare any interim dividend for the review period - The Board resolved not to declare any interim dividend for the review period[23](index=23&type=chunk) [Employees and Remuneration Policy](index=7&type=section&id=Employees%20and%20Remuneration%20Policy) As of September 30, 2020, the Group had 172 employees, with total staff costs of S$2,928 thousand for the review period; employee remuneration is determined by performance, experience, and market conditions, with customized training provided - As of September 30, 2020, the Group had **172 employees**, with total staff costs of **S$2,928 thousand**[24](index=24&type=chunk) - Employee remuneration is determined by performance, experience, and market conditions, with customized training provided[24](index=24&type=chunk) [Share Option Scheme](index=7&type=section&id=Share%20Option%20Scheme) The company adopted a share option scheme on September 23, 2019, to incentivize and reward eligible persons; as of September 30, 2020, no options had been granted or remained outstanding under the scheme - The share option scheme became effective on the listing date, aiming to incentivize or reward eligible persons for their contributions to the Group[25](index=25&type=chunk)[26](index=26&type=chunk) - As of September 30, 2020, no share options were outstanding[25](index=25&type=chunk) [Purpose of the Share Option Scheme](index=7&type=section&id=Purpose%20of%20the%20Share%20Option%20Scheme) The share option scheme aims to incentivize and reward eligible persons for their contributions or potential contributions to the Group, and to recruit and retain talent - Purpose: To incentivize or reward contributions, and to recruit and retain outstanding talent[26](index=26&type=chunk) [Eligible Participants](index=8&type=section&id=Eligible%20Participants) The Board may, at its discretion, grant options to employees (including directors), suppliers, customers, R&D support providers, shareholders, or other contributors to any Group member or investee entity - Eligible participants include employees, directors, suppliers, customers, R&D supporters, and shareholders[28](index=28&type=chunk) [Maximum Number of Shares](index=8&type=section&id=Maximum%20Number%20of%20Shares) The total number of shares that may be granted under the share option scheme and any other company share option schemes shall not exceed 80,000,000 shares, representing 10% of the total issued shares as of the interim report date - Maximum number of shares to be granted: **80,000,000 shares**, representing **10%** of the total issued shares[29](index=29&type=chunk) [Maximum Entitlement for Each Eligible Participant](index=8&type=section&id=Maximum%20Entitlement%20for%20Each%20Eligible%20Participant) Unless approved by shareholders in a general meeting, the shares exercisable under all options granted and to be granted to any eligible participant within a 12-month period shall not exceed 1% of the total issued shares; stricter limits apply to grants to substantial shareholders or independent non-executive directors - Shares exercisable by an individual within a 12-month period shall not exceed **1%** of the total issued shares[30](index=30&type=chunk) - Grants to substantial shareholders or independent non-executive directors exceeding **0.1%** or a total value of **HKD5 million** require independent shareholder approval[30](index=30&type=chunk) [Period During Which Options Must Be Exercised](index=9&type=section&id=Period%20During%20Which%20Options%20Must%20Be%20Exercised) Options may be exercised at any time within the period determined by the Board, in accordance with the terms of the share option scheme, which shall be within ten years from the date of grant - Options may be exercised within **ten years** from the date of grant[32](index=32&type=chunk) [Minimum Period for Holding Options Before Exercise](index=9&type=section&id=Minimum%20Period%20for%20Holding%20Options%20Before%20Exercise) Unless otherwise specified by the Board in the relevant option offer, there is no minimum period for holding an option before its exercise - Unless otherwise specified by the Board, there is no minimum holding period before exercising an option[33](index=33&type=chunk) [Period for Acceptance of Options and Consideration Payable](index=9&type=section&id=Period%20for%20Acceptance%20of%20Options%20and%20Consideration%20Payable) Eligible persons may accept the option offer within the date specified in the company's offer letter, which shall be no later than 21 days from the offer date; the option grantee shall pay HK$1.00 to the company upon acceptance - Acceptance period: within **21 days** from the offer date[34](index=34&type=chunk) - Consideration payable: **HKD1.00**[34](index=34&type=chunk) [Basis for Determining the Exercise Price](index=9&type=section&id=Basis%20for%20Determining%20the%20Exercise%20Price) The subscription price for option shares shall be determined by the Board and shall be no less than the highest of the closing price on the Stock Exchange on the offer date, the average closing price for the five trading days immediately preceding the offer date, and the nominal value of the shares on the offer date - Exercise price: No less than the highest of the closing price on the offer date, the average closing price for the five preceding trading days, and the nominal value of the shares on the offer date[35](index=35&type=chunk) [Remaining Term](index=9&type=section&id=Remaining%20Term) The share option scheme shall be valid and effective for ten years from its adoption date, after which no further options may be granted - The share option scheme is valid for **ten years** from its adoption date[36](index=36&type=chunk) [Use of Proceeds from Share Offer](index=10&type=section&id=Use%20of%20Proceeds%20from%20Share%20Offer) The net proceeds from the company's share offer were approximately S$13.0 million; due to the COVID-19 pandemic, the Board resolved to reallocate the unutilized net proceeds and adjust the funding distribution and expected timelines for various initiatives Use of Net Proceeds from Share Offer (As of September 30, 2020) | Purpose Item | Original Net Proceeds Allocation (S$ thousand) | Proposed Change in Net Proceeds Allocation (S$ thousand) | Reallocated Net Proceeds (S$ thousand) | Net Proceeds Utilized as of Sep 30, 2020 (S$ thousand) | Unutilized Revised Net Proceeds Balance as of Sep 30, 2020 (S$ thousand) | Expected Timeline for Full Utilization of Unutilized Proceeds | | :---------------------------------------------------- | :------------------------------------------- | :--------------------------------------- | :------------------------------------- | :--------------------------------------------------- | :------------------------------------------------------- | :------------------------------------ | | Opening of new self-operated specialty stores in Singapore | 2,900 | — | 2,900 | (169) | 2,731 | March 2024 | | Opening of new self-operated specialty stores in West Malaysia | 2,150 | — | 2,150 | (205) | 1,945 | March 2024 | | Expansion of non-self-operated specialty store and dine-in outlet network | 2,720 | (990) | 1,730 | (12) | 1,718 | March 2024 | | Renovation of self-operated specialty stores and dine-in outlets | 2,050 | (590) | 1,460 | (54) | 1,406 | March 2023 | | Staffing enhancement | 1,060 | — | 1,060 | (54) | 1,006 | March 2024 | | Marketing and promotional activities | 1,060 | (360) | 700 | (156) | 544 | March 2024 | | Upgrading IT infrastructure, data management, and franchise management systems | 1,060 | — | 1,060 | — | 1,060 | March 2023 | | General working capital | — | 1,940 | 1,940 | — | 1,940 | March 2024 | | **Total** | **13,000** | **—** | **13,000** | **(650)** | **12,350** | | - Net proceeds from the share offer were approximately **S$13.0 million**, with unutilized net proceeds reallocated due to the COVID-19 pandemic[38](index=38&type=chunk) [Future Plans and Material Investments and Capital Assets](index=11&type=section&id=Future%20Plans%20and%20Material%20Investments%20and%20Capital%20Assets) As of September 30, 2020, the Group had no other material investment and capital asset plans beyond those disclosed in the prospectus and this report - As of September 30, 2020, the Group had no other material investment and capital asset plans[40](index=40&type=chunk) [Material Investments, Acquisitions and Disposals](index=11&type=section&id=Material%20Investments%2C%20Acquisitions%20and%20Disposals) During the review period and up to the date of this report, the Group had no material acquisitions or disposals of subsidiaries, associates, or joint ventures - During the review period and up to the report date, the Group had no material acquisitions or disposals[41](index=41&type=chunk) [Charge on the Group's Assets](index=11&type=section&id=Charge%20on%20the%20Group%27s%20Assets) As of September 30, 2020, approximately S$2,404 thousand of the Group's secured bank borrowings were collateralized by properties with a carrying value of approximately S$3,215 thousand - Approximately **S$2,404 thousand** of secured bank borrowings are collateralized by properties with a carrying value of approximately **S$3,215 thousand**[42](index=42&type=chunk) [Financial Risk Management and Financial Instruments](index=11&type=section&id=Financial%20Risk%20Management%20and%20Financial%20Instruments) The Group's activities expose it to market risks (including foreign exchange, cash flow, and fair value interest rate risks), credit risk, and liquidity risk; there were no changes in risk management policies or derivative activities during the review period - The Group faces market risks (foreign exchange, interest rate), credit risk, and liquidity risk[43](index=43&type=chunk) - Risk management policies remained unchanged during the review period, with no derivative activities or financial instruments used to hedge foreign exchange risk[43](index=43&type=chunk) [Liquidity, Financial Resources and Capital Structure](index=11&type=section&id=Liquidity%2C%20Financial%20Resources%20and%20Capital%20Structure) As of September 30, 2020, the Group's total shareholders' equity was approximately S$26.3 million, current assets S$28.9 million, current liabilities S$4.1 million, with a current ratio of approximately 7.0; cash and cash equivalents were S$23.3 million, and the net cash to equity ratio was approximately 0.8 Liquidity and Financial Resources as of September 30, 2020 | Indicator | Sep 30, 2020 (S$ thousand) | Mar 31, 2020 (S$ thousand) | | :------------------------ | :------------------------- | :------------------------- | | Total Shareholders' Equity | 26,300 | 25,100 | | Current Assets | 28,900 | 27,400 | | Current Liabilities | 4,100 | 3,900 | | Current Ratio | 7.0 | 7.0 | | Outstanding Bank Borrowings | 2,404 | 2,444 | | Cash and Cash Equivalents | 23,300 | 21,600 | | Net Cash to Equity Ratio | 0.8 | 0.8 | - The Group holds sufficient cash to meet its commitments and working capital needs, with most bank deposits and cash denominated in Singapore Dollars, Malaysian Ringgit, and Hong Kong Dollars[46](index=46&type=chunk) - There have been no significant changes in the company's capital structure since the listing date, with capital comprising only ordinary shares[46](index=46&type=chunk) [Treasury Policy](index=12&type=section&id=Treasury%20Policy) The Group has adopted a prudent financial management approach for its treasury policy to maintain a healthy liquidity position, with the Board closely monitoring liquidity to ensure funding needs are met - The Group adopts a prudent financial management approach, and the Board closely monitors liquidity to ensure funding needs are met[47](index=47&type=chunk) [Gearing Ratio](index=12&type=section&id=Gearing%20Ratio) As of September 30, 2020, the Group's gearing ratio was approximately 15% (16% as of March 31, 2020), calculated as total liabilities divided by total equity at each period/year-end Gearing Ratio | Indicator | Sep 30, 2020 | Mar 31, 2020 | | :----------- | :----------- | :----------- | | Gearing Ratio | 15% | 16% | - The gearing ratio is calculated as total liabilities divided by total equity[48](index=48&type=chunk) [Off-Balance Sheet Commitments and Arrangements](index=12&type=section&id=Off-Balance%20Sheet%20Commitments%20and%20Arrangements) As of September 30, 2020, the Group had not entered into any significant off-balance sheet commitments or arrangements - As of September 30, 2020, the Group had no significant off-balance sheet commitments or arrangements[49](index=49&type=chunk) [Events After Reporting Period](index=12&type=section&id=Events%20After%20Reporting%20Period) There were no other significant events after the review period and up to the date of this report - No other significant events occurred after the review period and up to the report date[50](index=50&type=chunk) [Contingent Liabilities](index=12&type=section&id=Contingent%20Liabilities) As of September 30, 2020, the Group had no material contingent liabilities - As of September 30, 2020, the Group had no material contingent liabilities[51](index=51&type=chunk) [Disclosure Information](index=12&type=section&id=Disclosure%20Information) The company's interim report for the six months ended September 30, 2020, will be published on the Stock Exchange and company websites and distributed to shareholders in due course - The interim report will be published on the Stock Exchange website and the company website, and distributed to shareholders in due course[52](index=52&type=chunk) [Corporate Governance and Other Information](index=13&type=section&id=Corporate%20Governance%20and%20Other%20Information) This section details the company's corporate governance practices, including directors' and major shareholders' interests, compliance with codes, and the role of the audit committee [Directors' and Chief Executive's Interests and Short Positions in Shares and Underlying Shares and Debentures of the Company or its Associated Corporations](index=13&type=section&id=Directors%27%20and%20Chief%20Executive%27s%20Interests%20and%20Short%20Positions%20in%20Shares%20and%20Underlying%20Shares%20and%20Debentures%20of%20the%20Company%20or%20its%20Associated%20Corporations) As of September 30, 2020, Executive Directors Mr. Daniel Tay Kok Siong and Mr. Wong Chee Tat held a 75% equity interest in the company through their controlled corporation, Qiao Mai Limited, each beneficially owning 50% of Qiao Mai Limited Directors' and Chief Executive's Long Positions in Shares | Director Name | Capacity | Nature of Interest | Number of Shares Held | Percentage of Equity | | :--------------------- | :----------------- | :----------------- | :-------------------- | :------------------- | | Daniel Tay Kok Siong | Interest in controlled corporation | Corporate Interest | 600,000,000 | 75% | | Wong Chee Tat | Interest in controlled corporation | Corporate Interest | 600,000,000 | 75% | Directors' Long Positions in Shares of Associated Corporations | Director Name | Associated Corporation | Capacity | Nature of Interest | Number of Shares Held | Percentage of Equity | | :------------ | :------------------- | :------------- | :----------------- | :-------------------- | :------------------- | | Mr. Tay | Qiao Mai Limited | Beneficial Owner | Personal Interest | 1 | 50% | | Mr. Wong | Qiao Mai Limited | Beneficial Owner | Personal Interest | 1 | 50% | - Mr. Daniel Tay Kok Siong and Mr. Wong Chee Tat indirectly hold a **75%** equity interest in the company through Qiao Mai Limited[55](index=55&type=chunk)[59](index=59&type=chunk) [Substantial Shareholders' and Other Persons' Interests and Short Positions in Shares and Underlying Shares of the Company](index=15&type=section&id=Substantial%20Shareholders%27%20and%20Other%20Persons%27%20Interests%20and%20Short%20Positions%20in%20Shares%20and%20Underlying%20Shares%20of%20the%20Company) As of September 30, 2020, Qiao Mai Limited held a 75% equity interest in the company; additionally, the spouses of Mr. Wong Chee Tat and Mr. Daniel Tay Kok Siong are deemed to have the same share interests due to spousal interests Substantial Shareholders' and Other Persons' Long Positions in Shares | Name/Corporate Name | Capacity | Nature of Interest | Number of Shares Held | Percentage of Equity | | :------------------------- | :------------- | :----------------- | :-------------------- | :------------------- | | Qiao Mai Limited | Beneficial Owner | Personal Interest | 600,000,000 | 75% | | Chong Yi May Cheryl | Spouse's Interest | Family Interest | 600,000,000 | 75% | | Lim Michelle | Spouse's Interest | Family Interest | 600,000,000 | 75% | - Qiao Mai Limited holds **75%** of the company's shares, and the spouses of Mr. Wong and Mr. Tay are deemed to have the same interests due to spousal interests[63](index=63&type=chunk)[64](index=64&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=16&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20the%20Company%27s%20Listed%20Securities) During the review period, the company did not redeem any of its listed securities, nor did the company or any of its subsidiaries purchase or sell such securities - During the review period, neither the company nor its subsidiaries purchased, sold, or redeemed any listed securities[66](index=66&type=chunk) [Changes in Directors' Information](index=16&type=section&id=Changes%20in%20Directors%27%20Information) Independent Non-executive Director Mr. Koh Boon Hwee's information changed, as he was appointed Assistant General Counsel of MindChamps PreSchool Limited and resigned as Head of Legal at ICHX Tech Pte. Ltd., both effective August 2020 - Independent Non-executive Director Mr. Koh Boon Hwee was appointed Assistant General Counsel of MindChamps PreSchool Limited and resigned as Head of Legal at ICHX Tech Pte. Ltd[67](index=67&type=chunk) [Compliance with Corporate Governance Code](index=16&type=section&id=Compliance%20with%20Corporate%20Governance%20Code) The company is committed to maintaining high corporate governance standards, having adopted the Corporate Governance Code in Appendix 14 of the Listing Rules, and the Board believes it has complied with the code throughout the review period - The company has adopted the Corporate Governance Code and believes it has complied with it throughout the review period[68](index=68&type=chunk)[69](index=69&type=chunk) [Compliance with Model Code](index=16&type=section&id=Compliance%20with%20Model%20Code) The company has adopted the Model Code as its code of conduct for securities transactions by directors and relevant employees, and all directors have confirmed their compliance with the Model Code during the review period - The company has adopted the Model Code, and directors confirmed compliance during the review period[70](index=70&type=chunk) [Audit Committee](index=17&type=section&id=Audit%20Committee) The company established an Audit Committee on September 23, 2019, comprising three independent non-executive directors, chaired by Mr. Lim Wee Bin; its primary duties include providing independent opinions, overseeing audit procedures, and reviewing the Group's unaudited interim results and this report - The Audit Committee comprises three independent non-executive directors, chaired by Mr. Lim Wee Bin[73](index=73&type=chunk) - The committee has reviewed the Group's unaudited interim results and this report, deeming them compliant with applicable accounting standards and legal requirements[73](index=73&type=chunk) [Acknowledgement](index=17&type=section&id=Acknowledgement) The Board sincerely thanks the Group's shareholders, business partners, and customers for their continued support and expresses gratitude for the efforts of management and staff during the review period - The Board thanks shareholders, business partners, customers for their support, and management and staff for their efforts[74](index=74&type=chunk) [Condensed Consolidated Statement of Comprehensive Income](index=18&type=section&id=Condensed%20Consolidated%20Statement%20of%20Comprehensive%20Income) For the six months ended September 30, 2020, the Group's revenue was S$10,788 thousand, a decrease from the prior year; profit for the period was S$1,232 thousand, with basic and diluted earnings per share of S$0.15 cents Condensed Consolidated Statement of Comprehensive Income (For the Six Months Ended September 30) | Indicator | 2020 (S$ thousand) (Unaudited) | 2019 (S$ thousand) (Unaudited) | | :------------------------------ | :----------------------------- | :----------------------------- | | Revenue | 10,788 | 12,008 | | Cost of Sales | (3,868) | (4,370) | | Gross Profit | 6,920 | 7,638 | | Other Income | 1,059 | 157 | | Other (Losses)/Gains — Net | (371) | 3 | | Selling and Distribution Expenses | (2,710) | (2,280) | | Administrative Expenses | (3,237) | (2,867) | | Finance Income/(Costs) — Net | 13 | (53) | | Profit Before Income Tax | 1,674 | 2,598 | | Income Tax Expense | (442) | (642) | | Profit for the Period Attributable to Owners of the Company | 1,232 | 1,956 | | Exchange differences on translation of foreign operations | (4) | (8) | | Total Comprehensive Income for the Period Attributable to Owners of the Company | 1,228 | 1,948 | | Basic and Diluted Earnings Per Share (S$ cents) | 0.15 | 0.32 | [Condensed Consolidated Statement of Financial Position](index=19&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of September 30, 2020, the Group's total assets were S$34,518 thousand, total liabilities S$8,224 thousand, and equity attributable to owners of the company S$26,294 thousand Condensed Consolidated Statement of Financial Position (As of September 30, 2020) | Indicator | Sep 30, 2020 (S$ thousand) (Unaudited) | Mar 31, 2020 (S$ thousand) (Audited) | | :------------------------------ | :----------------------------------- | :--------------------------------- | | **Assets** | | | | Non-current Assets | | | | Property, Plant and Equipment | 5,600 | 5,538 | | Current Assets | | | | Inventories | 1,350 | 1,245 | | Trade and Other Receivables and Prepayments | 4,276 | 4,589 | | Cash and Cash Equivalents | 23,292 | 21,554 | | **Total Current Assets** | **28,918** | **27,388** | | **Total Assets** | **34,518** | **32,926** | | **Equity and Liabilities** | | | | **Equity** | | | | Share Capital | 1,392 | 1,392 | | Share Premium | 17,092 | 17,092 | | Capital Reserve | 7,810 | 6,582 | | **Equity Attributable to Owners of the Company** | **26,294** | **25,066** | | **Liabilities** | | | | Current Liabilities | | | | Trade and Other Payables | 2,123 | 1,673 | | Borrowings | 130 | 81 | | Provisions | 105 | 98 | | Deferred Income | 464 | 465 | | Current Income Tax and Liabilities | 507 | 555 | | Lease Liabilities | 792 | 1,013 | | **Total Current Liabilities** | **4,121** | **3,885** | | Non-current Liabilities | | | | Deferred Income | 979 | 1,027 | | Deferred Tax Liabilities | 16 | 16 | | Borrowings | 2,274 | 2,363 | | Lease Liabilities | 834 | 569 | | **Total Non-current Liabilities** | **4,103** | **3,975** | | **Total Liabilities** | **8,224** | **7,860** | | **Total Equity and Liabilities** | **34,518** | **32,926** | [Condensed Consolidated Statement of Changes in Equity](index=21&type=section&id=Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) For the six months ended September 30, 2020, total equity attributable to owners of the company increased from S$25,066 thousand as of April 1, 2020, to S$26,294 thousand, primarily driven by a profit for the period of S$1,232 thousand Condensed Consolidated Statement of Changes in Equity (For the Six Months Ended September 30) | Indicator | Share Capital (S$ thousand) | Share Premium (S$ thousand) | Capital Reserve (S$ thousand) | Exchange Reserve (S$ thousand) | Accumulated Profits (S$ thousand) | Total Equity (S$ thousand) | | :-------------------------------------- | :-------------------------- | :-------------------------- | :---------------------------- | :----------------------------- | :-------------------------------- | :------------------------- | | **As of April 1, 2020 (Audited)** | **1,392** | **17,092** | **261** | **(187)** | **6,508** | **25,066** | | Profit for the period | — | — | — | — | 1,232 | 1,232 | | Other comprehensive loss for the period | — | — | — | (4) | — | (4) | | **Total Comprehensive (Loss)/Income for the Period** | **—** | **—** | **—** | **(4)** | **1,232** | **1,228** | | **As of September 30, 2020 (Unaudited)** | **1,392** | **17,092** | **261** | **(191)** | **7,740** | **26,294** | | | | | | | | | | **As of April 1, 2019 (Audited)** | **—** | **—** | **261** | **(204)** | **4,046** | **4,103** | | Profit for the period | — | — | — | — | 1,956 | 1,956 | | Other comprehensive loss for the period | — | — | — | — | (8) | (8) | | **Total Comprehensive Income/(Loss) for the Period** | **—** | **—** | **—** | **—** | **1,956** | **1,948** | | Adoption of IFRS 16 | — | — | — | — | 73 | 73 | | Issue of ordinary shares by the Company — Completion of Reorganisation | * | — | — | — | — | — | | Dividends declared for the period | — | — | — | (1,000) | — | (1,000) | | (Recognised directly in equity) | * | — | (1,000) | — | (1,000) | | | **As of September 30, 2019 (Unaudited)** | **—** | **261** | **5,002** | **(212)** | **5,051** | | [Condensed Consolidated Statement of Cash Flows](index=23&type=section&id=Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) For the six months ended September 30, 2020, net cash generated from operating activities was S$3,020 thousand; net cash used in investing activities was S$73 thousand, and net cash used in financing activities was S$748 thousand, resulting in a net increase in cash and cash equivalents of S$2,199 thousand, with an ending balance of S$23,292 thousand Condensed Consolidated Statement of Cash Flows (For the Six Months Ended September 30) | Indicator | 2020 (S$ thousand) (Unaudited) | 2019 (S$ thousand) (Unaudited) | | :------------------------------ | :----------------------------- | :----------------------------- | | Cash generated from operations | 3,511 | 4,411 | | Income tax paid | (491) | (378) | | **Net Cash from Operating Activities** | **3,020** | **4,033** | | Purchase of property, plant and equipment | (148) | (210) | | Interest received | 75 | 10 | | **Net Cash Used in Investing Activities** | **(73)** | **(200)** | | Principal portion of lease payments | (646) | (776) | | Interest paid | (62) | (28) | | Repayment of borrowings | (40) | (1,039) | | Listing expenses | — | (296) | | **Net Cash Used in Financing Activities** | **(748)** | **(2,139)** | | **Net Increase in Cash and Cash Equivalents** | **2,199** | **1,694** | | Cash and cash equivalents at beginning of period | 21,554 | 4,263 | | Net effect of exchange rate changes on consolidated subsidiaries | (461) | (11) | | **Cash and Cash Equivalents at End of Review Period** | **23,292** | **5,946** | [Notes to the Condensed Consolidated Financial Statements](index=25&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed notes to the condensed consolidated financial statements, covering general information, basis of preparation, accounting policies, estimates, financial risk management, segment information, and specific financial line items [1 General Information](index=25&type=section&id=1%20General%20Information) Fast Food Empire Holdings Limited and its subsidiaries primarily engage in wholesale and retail of snack food and beverages; the company is incorporated in the Cayman Islands, listed on the Main Board of the Stock Exchange, and its condensed consolidated interim financial information is unaudited but reviewed by the Audit Committee - The Group primarily engages in the wholesale and retail of snack food and beverages[107](index=107&type=chunk) - Shares were initially listed on the Main Board of the Stock Exchange[108](index=108&type=chunk) - The condensed consolidated interim financial information is unaudited but has been reviewed by the Audit Committee[109](index=109&type=chunk) [2 Basis of Preparation](index=25&type=section&id=2%20Basis%20of%20Preparation) This condensed consolidated interim financial information is prepared in accordance with IAS 34 Interim Financial Reporting and applicable disclosure requirements of Appendix 16 of the Listing Rules, presented under the historical cost convention, with Singapore dollars as the functional currency, and should be read in conjunction with the Group's consolidated financial statements for the year ended March 31, 2020 - Prepared in accordance with IAS 34 and Appendix 16 of the Listing Rules[110](index=110&type=chunk) - Presented in Singapore Dollars[111](index=111&type=chunk) - Should be read in conjunction with the Group's consolidated financial statements for the year ended March 31, 2020[111](index=111&type=chunk) [3 Principal Accounting Policies](index=25&type=section&id=3%20Principal%20Accounting%20Policies) The accounting policies and methods of computation used in the condensed consolidated interim financial information are consistent with those applied in the preparation of the Group's consolidated financial statements for the year ended March 31, 2020 - Accounting policies are consistent with the 2020 fiscal year consolidated financial statements[112](index=112&type=chunk) [4 Accounting Estimates](index=26&type=section&id=4%20Accounting%20Estimates) The preparation of condensed consolidated interim financial information requires management to make judgments, estimates, and assumptions affecting the application of accounting policies, reported amounts of assets and liabilities, and income and expenses; key judgments and estimation uncertainties are consistent with those disclosed in the 2020 annual report - Preparation of financial information involves management judgments, estimates, and assumptions[114](index=114&type=chunk) - Key judgments are consistent with those disclosed in the 2020 annual report[114](index=114&type=chunk) [5 Financial Risk Management and Financial Instruments](index=26&type=section&id=5%20Financial%20Risk%20Management%20and%20Financial%20Instruments) The Group's operations are exposed to market risks (including foreign exchange, cash flow, and fair value interest rate risks), credit risk, and liquidity risk; risk management policies remained unchanged, and no derivative activities were undertaken during the review period, with carrying amounts of liquid financial assets and liabilities approximating fair values at the reporting date - The Group faces market risk, credit risk, and liquidity risk[115](index=115&type=chunk) - Risk management policies remained unchanged during the review period[116](index=116&type=chunk) - Carrying amounts of liquid financial assets and liabilities approximate fair values[117](index=117&type=chunk) [6 Segment Information](index=27&type=section&id=6%20Segment%20Information) The Group's chief operating decision maker considers all operations as a single operating segment; geographically, Singapore revenue increased while Malaysia and Indonesia revenues decreased, with non-current assets primarily concentrated in Singapore - The chief operating decision maker considers all business as a single operating segment[121](index=121&type=chunk) Revenue by Geographical Area (For the Six Months Ended September 30) | Region | 2020 (S$ thousand) (Unaudited) | 2019 (S$ thousand) (Unaudited) | | :--------- | :----------------------------- | :----------------------------- | | Singapore | 5,844 | 4,719 | | Malaysia | 4,200 | 5,395 | | Indonesia | 574 | 1,658 | | United States | 69 | 224 | | Others | 101 | 12 | | **Total** | **10,788** | **12,008** | Non-current Assets by Geographical Area (As of September 30, 2020) | Region | Sep 30, 2020 (S$ thousand) (Unaudited) | Mar 31, 2020 (S$ thousand) (Audited) | | :--------- | :----------------------------------- | :--------------------------------- | | Singapore | 4,953 | 4,644 | | Malaysia | 647 | 894 | | **Total** | **5,600** | **5,538** | [7 Other Income](index=28&type=section&id=7%20Other%20Income) For the six months ended September 30, 2020, other income significantly increased to S$1,059 thousand, primarily driven by S$906 thousand in government grants, compared to only S$7 thousand in the prior period Other Income (For the Six Months Ended September 30) | Source | 2020 (S$ thousand) (Unaudited) | 2019 (S$ thousand) (Unaudited) | | :----------- | :----------------------------- | :----------------------------- | | Government grants | 906 | 7 | | Operating fee income | 33 | 43 | | Others | 120 | 107 | | **Total** | **1,059** | **157** | - Government grants are the primary reason for the significant increase in other income[126](index=126&type=chunk) [8 Finance Income / (Costs) — Net](index=29&type=section&id=8%20Finance%20Income%20%2F%20%28Costs%29%20%E2%80%94%20Net) For the six months ended September 30, 2020, net finance income was S$13 thousand, compared to a net cost of S$53 thousand in the prior period, primarily due to increased interest income Finance Income/(Costs) — Net (For the Six Months Ended September 30) | Item | 2020 (S$ thousand) (Unaudited) | 2019 (S$ thousand) (Unaudited) | | :--------- | :----------------------------- | :----------------------------- | | Interest income | 75 | 10 | | Interest expense | (62) | (63) | | **Net** | **13** | **(53)** | - Net finance shifted from a cost to income, primarily due to increased interest income[129](index=129&type=chunk) [9 Income Tax Expense](index=29&type=section&id=9%20Income%20Tax%20Expense) For the six months ended September 30, 2020, income tax expense was S$442 thousand, down from S$642 thousand in the prior period; taxes are provided at applicable rates in operating countries, 17% for Singapore and approximately 24% for Malaysia Income Tax Expense (For the Six Months Ended September 30) | Item | 2020 (S$ thousand) (Unaudited) | 2019 (S$ thousand) (Unaudited) | | :------------- | :----------------------------- | :----------------------------- | | Singapore income tax | 324 | 476 | | Malaysia income tax | 118 | 166 | | **Total** | **442** | **642** | - Singapore corporate income tax is provided at an estimated **17%** of assessable profit, while Malaysian entities are subject to an income tax rate of approximately **24%**[134](index=134&type=chunk) [10 Profit for the Period](index=30&type=section&id=10%20Profit%20for%20the%20Period) Profit for the period is derived after deducting expenses such as employee benefits, total directors' remuneration, retirement benefit costs, and depreciation of property, plant, and equipment Profit for the Period Deductions (For the Six Months Ended September 30) | Item | 2020 (S$ thousand) (Unaudited) | 2019 (S$ thousand) (Unaudited) | | :--------------------- | :----------------------------- | :----------------------------- | | Wages, salaries and allowances | 2,711 | 2,010 | | Retirement benefit costs — defined contribution plans | 217 | 138 | | Depreciation of property, plant and equipment | 779 | 862 | [11 Dividends](index=31&type=section&id=11%20Dividends) For the six months ended September 30, 2020, the company declared no dividends, compared to S$1,000 thousand declared in the prior period Dividends (For the Six Months Ended September 30) | Item | 2020 (S$ thousand) (Unaudited) | 2019 (S$ thousand) (Unaudited) | | :----------- | :----------------------------- | :----------------------------- | | Dividends declared during the period | — | 1,000 | [12 Earnings Per Share](index=31&type=section&id=12%20Earnings%20Per%20Share) For the six months ended September 30, 2020, basic and diluted earnings per share were S$0.15 cents, down from S$0.32 cents in the prior period; diluted EPS equals basic EPS as there were no outstanding potentially dilutive ordinary shares Earnings Per Share (For the Six Months Ended September 30) | Indicator | 2020 (Unaudited) | 2019 (Unaudited) | | :------------------------------ | :--------------- | :--------------- | | Profit attributable to owners of the Company (S$ thousand) | 1,228 | 1,948 | | Weighted average number of ordinary shares outstanding | 800,000,000 | 600,000,000 | | Basic and diluted earnings per share (S$ cents per share) | 0.15 | 0.32 | - Diluted earnings per share is equal to basic earnings per share because there were no outstanding potentially dilutive ordinary shares as of the end of the reporting period[139](index=139&type=chunk) [13 Changes in Property, Plant and Equipment](index=32&type=section&id=13%20Changes%20in%20Property%2C%20Plant%20and%20Equipment) During the review period, the Group acquired property, plant, and equipment (including furniture and fixtures, kitchen equipment, office equipment, and renovation works) totaling approximately S$152 thousand; right-of-use assets capitalized under IFRS 16 amounted to approximately S$5.8 million - During the review period, acquisitions of furniture and fixtures, kitchen equipment, office equipment, and renovation works totaled approximately **S$152 thousand**[142](index=142&type=chunk) - Right-of-use assets capitalized under IFRS 16 amounted to approximately **S$5.8 million**[142](index=142&type=chunk) [14 Inventories](index=32&type=section&id=14%20Inventories) Inventories comprise fast-moving consumable items; for the period ended September 30, 2020, the cost of inventories recognized as cost of sales was S$3,868 thousand, a decrease from S$4,370 thousand in the prior period - Inventories include fast-moving consumable items[142](index=142&type=chunk) - For the period ended September 30, 2020, the cost of inventories recognized as cost of sales was **S$3,868 thousand** (2019: S$4,370 thousand)[142](index=142&type=chunk) [15 Trade and Other Receivables and Prepayments](index=32&type=section&id=15%20Trade%20and%20Other%20Receivables%20and%20Prepayments) As of September 30, 2020, total trade and other receivables amounted to S$4,276 thousand, with trade receivables at S$368 thousand; the aging analysis of trade receivables shows S$226 thousand overdue by more than 90 days Trade and Other Receivables (As of September 30, 2020) | Item | Sep 30, 2020 (S$ thousand) (Unaudited) | Mar 31, 2020 (S$ thousand) (Audited) | | :------------------------- | :----------------------------------- | :--------------------------------- | | Trade receivables | 368 | 389 | | Other receivables | 3,908 | 4,200 | | **Trade and Other Receivables** | **4,276** | **4,589** | Aging Analysis of Trade Receivables (As of September 30, 2020) | Aging | Sep 30, 2020 (S$ thousand) | Mar 31, 2020 (S$ thousand) | | :----------- | :------------------------- | :------------------------- | | Current to 30 days | 91 | 153 | | 31 to 60 days | 30 | 122 | | 61 to 90 days | 21 | 84 | | Over 90 days | 226 | 30 | | **Total** | **368** | **389** | [16 Cash and Cash Equivalents](index=33&type=section&id=16%20Cash%20and%20Cash%20Equivalents) As of September 30, 2020, total cash and cash equivalents amounted to S$23,292 thousand, primarily consisting of cash at bank Cash and Cash Equivalents (As of September 30, 2020) | Item | Sep 30, 2020 (S$ thousand) (Unaudited) | Mar 31, 2020 (S$ thousand) (Audited) | | :--------- | :----------------------------------- | :--------------------------------- | | Cash at bank | 23,288 | 21,541 | | Cash on hand | 4 | 13 | | **Total** | **23,292** | **21,554** | [17 Trade and Other Payables](index=33&type=section&id=17%20Trade%20and%20Other%20Payables) As of September 30, 2020, total trade and other payables amounted to S$2,123 thousand, with trade payables at S$574 thousand; the aging analysis of trade payables indicates most amounts are within 30 days Trade and Other Payables (As of September 30, 2020) | Item | Sep 30, 2020 (S$ thousand) (Unaudited) | Mar 31, 2020 (S$ thousand) (Audited) | | :--------------------- | :----------------------------------- | :--------------------------------- | | Trade payables | 574 | 333 | | Other payables and accrued expenses | 1,549 | 1,340 | | **Total** | **2,123** | **1,673** | Aging Analysis of Trade Payables (As of September 30, 2020) | Aging | Sep 30, 2020 (S$ thousand) | Mar 31, 2020 (S$ thousand) | | :----------- | :------------------------- | :------------------------- | | Current to 30 days | 455 | 236 | | 31 to 60 days | 52 | 88 | | Over 60 days | 67 | 9 | | **Total** | **574** | **333** | [18 Borrowings](index=34&type=section&id=18%20Borrowings) As of September 30, 2020, the Group's total outstanding bank borrowings were S$2,404 thousand, comprising S$130 thousand in current borrowings and S$2,274 thousand in non-current borrowings; the weighted average effective annual interest rate was 1.6%, and all borrowings are secured by Group properties Borrowings (As of September 30, 2020) | Item | Sep 30, 2020 (S$ thousand) (Unaudited) | Mar 31, 2020 (S$ thousand) (Audited) | | :--------- | :----------------------------------- | :--------------------------------- | | Current bank borrowings | 130 | 81 | | Non-current bank borrowings | 2,274 | 2,363 | | **Total** | **2,404** | **2,444** | - The weighted average effective annual interest rate for borrowings is **1.6%**[151](index=151&type=chunk) - All Group borrowings are secured by Group properties with a current value of approximately **S$3,215 thousand**[151](index=151&type=chunk) [19 Significant Related Party Transactions](index=35&type=section&id=19%20Significant%20Related%20Party%20Transactions) During the review period and as of September 30, 2020, the Group had no significant related party transactions or balances, with only key management compensation disclosed Key Management Compensation (For the Six Months Ended September 30) | Item | 2020 (S$ thousand) (Unaudited) | 2019 (S$ thousand) (Unaudited) | | :------------------- | :----------------------------- | :----------------------------- | | Salaries and other short-term employee benefits | 977 | 319 | - No significant related party transactions or balances occurred during the review period[154](index=154&type=chunk)

Financial Performance - The company reported total revenue of 24,262 thousand SGD for the year, an increase of 13.7% from 21,325 thousand SGD in the previous year[16]. - The company generated revenue from franchise sales, which amounted to 9,035 thousand SGD, up from 8,383 thousand SGD the previous year[16]. - The group’s total revenue increased from approximately SGD 21,325,000 in 2019 to approximately SGD 24,262,000 in the current year, representing a growth of about 13%[20]. - The group’s gross profit for the current year was approximately SGD 15,373,000, up about 22% from SGD 12,624,000 in 2019, primarily due to an increase in self-operated stores[24]. - The company reported a franchise fee income of 684 thousand SGD, an increase from 511 thousand SGD in the previous year[16]. - The company reported a significant increase in revenue, achieving a total of $500 million for the fiscal year, representing a 20% growth compared to the previous year[62]. - The company provided guidance for the next fiscal year, projecting revenue growth of 25% and aiming for $625 million[62]. - New product launches are expected to contribute an additional $50 million in revenue, with a focus on expanding the product line[62]. - Market expansion plans include entering three new countries, which are projected to generate $30 million in additional revenue[62]. Store Operations and Expansion - The company operates 248 stores across various regions, including 16 self-operated stores in Singapore and 14 in West Malaysia[17]. - The company plans to open new self-operated stores and dining locations in Singapore and West Malaysia, as well as expand its non-self-operated store network[12]. - The company has launched its first concept store in Singapore's PLQ Mall, which has received positive feedback and plans to open a similar store in West Malaysia[10]. - Sales to franchisees/licensees increased by approximately 7%, with the number of non-self-operated stores rising from 175 in 2019 to 218 in the current year[20]. - The group plans to expand into multiple overseas markets and enhance marketing efforts to attract a diverse customer base[39]. Financial Health and Liquidity - Cash and cash equivalents increased from approximately SGD 4.3 million in 2019 to about SGD 21.6 million in the current year, a rise of approximately SGD 17.3 million[29]. - The current ratio improved to approximately 7.0 times from 1.7 times in 2019, indicating better liquidity[29]. - The company recorded a debt-to-equity ratio of approximately 16% as of March 31, 2020, a significant decrease from 92% in 2019[30]. - Employee costs rose from approximately SGD 3.2 million in 2019 to about SGD 4.8 million in the current year, an increase of approximately 50%[25]. - The cost of goods sold increased from approximately SGD 8,701,000 in 2019 to about SGD 8,889,000 in the current year, reflecting a 2% increase[23]. Corporate Governance - The board of directors held three meetings during the review period, with all directors attending 100% of the meetings[72]. - The company has three independent non-executive directors, meeting the requirement that they constitute at least one-third of the board[76]. - The roles of the chairman and the CEO are separated to ensure a balance of power within the board[78]. - The company has implemented appropriate and sufficient directors' and officers' liability insurance to protect against legal claims arising from their duties[79]. - The company has adopted and adhered to the principles of the corporate governance code, emphasizing transparency and accountability[70]. - The board regularly reviews and follows up on corporate governance policies to ensure compliance with the code[69]. - The company provides training for all directors to enhance their understanding of corporate governance and their responsibilities[81]. - The company has established various committees within the board, including a remuneration committee and an audit committee, to oversee specific responsibilities[73]. Risk Management - The board of directors confirmed the effectiveness of the group's risk management and internal control systems, with no significant issues identified during the review period[112]. - The company has engaged external consultants to review its risk management and internal control systems, ensuring independent and objective assurance and advisory services[112]. - The company faces significant risks related to the market recognition of its Shilin Taiwan Snack® brand, which is crucial for its success and brand value[135]. - The company acknowledges that maintaining consistent quality may become more challenging as it expands its scale and product variety[135]. - Any delays or cancellations of major sales orders by franchisees could lead to revenue fluctuations and negatively impact financial performance[137]. Shareholder Relations and Dividends - The company has adopted a dividend policy, proposing to distribute no less than 40% of net profit as dividends, subject to board discretion and shareholder approval[128]. - The company has declared an interim dividend of 1.0 million SGD to shareholders, which was paid in October 2019[149]. - No final dividend is recommended for the current fiscal year, indicating a cautious approach to cash distribution amid potential financial uncertainties[150]. - The company has no distributable reserves as of March 31, 2020, which may limit future dividend payments[153]. - The company emphasizes the importance of maintaining transparent and effective communication with shareholders to build investor confidence and attract new investors[121]. Operational Improvements and Efficiency - Operational improvements have led to a 10% reduction in costs, contributing to higher profit margins[62]. - The company is investing $10 million in research and development for new technologies aimed at improving operational efficiency[62]. - The company is actively seeking additional opportunities to expand revenue sources and enhance shareholder value[12]. Employee Training and Development - Regular training will be provided to employees to enhance service levels within the group[39]. - The board has reviewed and monitored the training and continuous professional development of directors and senior management[104].

Revenue Growth - Total revenue increased by approximately 28.4% from 9,350 thousand SGD in the corresponding period to 12,008 thousand SGD in the review period[7] - Sales from specialty stores rose by about 19.8%, with the number of self-operated specialty and dining stores increasing from 25 to 29[8] - Sales to franchisees and licensed operators increased by approximately 38.7%, with the number of non-self-operated stores rising from 162 to 199[10] - Revenue for the six months ended September 30, 2020, was 12,008 thousand SGD, representing a 28.4% increase from 9,350 thousand SGD in the same period of 2019[52] - Revenue from Singapore increased to 4,719 thousand SGD in 2019 from 3,525 thousand SGD in 2018, representing a growth of 34%[120] - Revenue from Malaysia rose to 5,395 thousand SGD in 2019 compared to 4,594 thousand SGD in 2018, marking an increase of 17%[120] Profitability - Net profit for the review period was 2.9 million SGD, up from 1.9 million SGD in the corresponding period[11] - Gross profit for the same period was 7,638 thousand SGD, up 32.8% from 5,747 thousand SGD year-on-year[52] - Profit attributable to equity holders for the period was 1,956 thousand SGD, a significant increase of 505.5% compared to 323 thousand SGD in the previous year[52] - Profit before tax for the six months ended September 30, 2019, was 1,948 thousand SGD, up from 274 thousand SGD in 2018, indicating a significant increase[130] - The total comprehensive income for the period was reported at 1,948 thousand SGD, reflecting a profit of 1,956 thousand SGD after accounting for other comprehensive losses[67] Financial Position - As of September 30, 2019, the total equity of the group was SGD 5.1 million, an increase from SGD 4.0 million as of March 31, 2019[23] - As of September 30, 2019, the group's current assets were SGD 13.1 million, up from SGD 9.0 million as of March 31, 2019, while current liabilities increased to SGD 9.7 million from SGD 5.4 million[23] - The current ratio as of September 30, 2019, was 1.4, compared to 1.6 as of March 31, 2019[23] - The group's net cash equity ratio as of September 30, 2019, was 0.7, an increase from 0.4 as of March 31, 2019[23] - The debt-to-equity ratio as of September 30, 2019, was 49.2%, significantly improved from 92.0% as of March 31, 2019[26] - Total assets as of September 30, 2020, amounted to 18,627 thousand SGD, compared to 12,794 thousand SGD as of March 31, 2019, reflecting a growth of 45.7%[54][57] Cash Flow - Cash generated from operating activities was 4,411 thousand SGD, significantly higher than 2,535 thousand SGD in the previous period[76] - The net cash from operating activities after tax payments was 4,033 thousand SGD, compared to 2,497 thousand SGD previously[76] - The group’s cash and cash equivalents increased to 5,946 thousand SGD from 3,854 thousand SGD[79] - The company declared a dividend of 1,000 thousand SGD for the period[70] - The group experienced a net cash outflow from financing activities of 2,139 thousand SGD, compared to a net inflow of 653 thousand SGD in the previous period[79] Future Plans and Investments - The company plans to open up to 16 new self-operated specialty stores in Singapore by March 31, 2024, using approximately 22.2% of the net proceeds from the IPO[16] - Approximately 20.9% of the net proceeds will be used to expand the network of non-self-operated specialty and dining stores[16] - The company aims to renovate about 5 self-operated specialty stores in Singapore and 4 dining stores in West Malaysia each year until March 31, 2023[16] - Approximately 8.2% or about HKD 6.1 million will be used for recruiting employees in Singapore and West Malaysia[18] - Approximately 8.2% or about HKD 6.1 million will be allocated for the development of the Shilin Taiwan Snack® brand and targeted sales and marketing activities[18] - Approximately 8.2% or about HKD 6.1 million will be invested in developing a customized enterprise resource planning system to enhance the group's data infrastructure and analytics systems[18] Employee and Operational Information - The company had 155 employees as of September 30, 2019, with total employee costs amounting to 1,968 thousand SGD during the review period[14] - The macro environment for the company's operations in Taiwan, Singapore, Malaysia, Indonesia, and the United States remains stable, with continued sales growth trends[12] - Franchise fees and advertising income are expected to remain stable, contributing approximately 2.0% to 3.0% of total revenue[11] Financial Management and Compliance - The company maintained compliance with corporate governance codes since its listing date[46][47] - The group’s financial risk management policies have not undergone significant changes during the review period[114] - The carrying amounts of current financial assets and liabilities are similar to their fair values due to their short maturities[115] - The group’s operating segments are monitored by the executive directors, who assess performance for resource allocation decisions[118] - The adoption of IFRS 16 resulted in an increase in right-of-use assets by 1,933 million and lease liabilities by 1,860 million as of April 1, 2019[102]