设计都会(01545) - 2023 - 中期财报

Company Information This section provides fundamental details of Design Metropolis Limited, covering its board, committees, key personnel, registered office, and auditors - The Board of Directors includes executive, non-executive, and independent non-executive directors, with Mr. Ruan Youren serving as Chairman and CEO[3] - The company has an Audit Committee, Remuneration Committee, and Nomination Committee, all with independent non-executive director participation[3] - The company's registered office is in the Cayman Islands, with its principal place of business and headquarters in Singapore, and a principal place of business in Hong Kong[3][4] - The auditor is Ernst & Young LLP, Singapore[3] Management Discussion and Analysis This section reviews the Group's business performance, financial condition, and outlook for the six months ended June 30, 2023, noting revenue growth but a significant decline in profit before tax due to margin compression and increased expenses Key Financial Data for H1 2023 | Metric | 2023年6月30日 (S$ thousand) | 2022年6月30日 (S$ thousand) | Change | | :--- | :--- | :--- | :--- | | Revenue | 46,300 | 44,700 | 3.7% Increase | | Profit Before Tax | 1,100 | 2,500 | (56.0%) Decrease | | Gross Margin | 27.6% | 29.5% | (1.9%) Decrease | | Profit for the Period | 700 | 1,900 | (60.9%) Decrease | Business Review The Group's revenue for the six months ended June 30, 2023, increased by 3.7% to approximately S$46.3 million, but profit before tax significantly declined by 58.3% due to reduced gross margin in US furniture sales and higher selling expenses | Metric | 2023年6月30日 (S$ thousand) | 2022年6月30日 (S$ thousand) | Change | | :--- | :--- | :--- | :--- | | Revenue | 46,300 | 44,700 | 3.7% Increase | | Profit Before Tax | 1,100 | 2,500 | (56.0%) Decrease | - The decrease in profit before tax was primarily due to reduced gross margin in the US furniture sales segment and increased selling and distribution expenses[5] US Furniture Sales US Furniture Sales revenue increased from S$30.6 million to S$31.0 million, but faced challenges from high interest rates and elevated inventory, leading to profit compression and reduced profitability | Metric | 2023年6月30日 (S$ thousand) | 2022年6月30日 (S$ thousand) | | :--- | :--- | :--- | | Revenue | 31,000 | 30,600 | - The segment faced challenges including exceptionally high interest rates and abnormally high post-pandemic inventory, resulting in profit compression and reduced profitability in H1 FY2023[5] Furniture Sales Furniture Sales revenue increased by 19.9% to S$12.9 million, driven by strong performance of 'Lifestorey' and 'Marquis' brands and successful European imports, though the 'OM' mass market segment faced slower demand and competition | Metric | 2023年6月30日 (S$ thousand) | 2022年6月30日 (S$ thousand) | Change | | :--- | :--- | :--- | :--- | | Revenue | 12,900 | 10,700 | 19.9% Increase | - The 'Lifestorey' and 'Marquis' brands performed well, benefiting from successful curation of European imported furniture brands[7] - The mass market segment under the 'OM' brand continued to be negatively impacted by slowing consumer demand and intense competition from e-commerce retailers[7] Interior Design Interior Design revenue decreased by 25.2% to S$2.5 million, primarily due to fewer projects in Singapore and Malaysia and the disposal of subsidiary Nobel Design Sdn Bhd | Metric | 2023年6月30日 (S$ thousand) | 2022年6月30日 (S$ thousand) | Change | | :--- | :--- | :--- | :--- | | Revenue | 2,500 | 3,300 | (25.2%) Decrease | - The decrease in revenue was mainly attributable to fewer projects in Singapore and Malaysia and the disposal of a subsidiary, Nobel Design Sdn Bhd[8] Outlook Management anticipates challenges in the US market in H2 2023, focusing on inventory management and luxury market expansion, with the interior design business expected to contribute positively US Furniture Sales Outlook The US market is expected to face challenges in H2 2023, including inflation, rising interest rates, recession risks, and geopolitical tensions, with a focus on inventory reduction potentially impacting gross margin and financial performance - The US market is expected to face challenges in H2 FY2023, with rising inflation, increasing interest rates, heightened recession risks, and geopolitical tensions between the US and China impacting consumer sentiment and demand[11] - The Group will continue to focus on reducing inventory in this segment, which may negatively impact its gross margin and financial performance in H2 FY2023[11] Furniture Sales Outlook Despite global economic slowdown, the Group will continue to nurture new brands and products, evaluate mass market performance, and plans to expand showrooms in FY2024 to gain greater market share in the luxury segment - The Group will continue to focus on nurturing new brands and products, and evaluating the performance of the mass market segment[12] - The Group will continue to focus on the luxury market and expand its product range in H2 FY2023[12] - Discussions are underway with a renowned fashion furniture brand, with plans to expand showrooms in FY2024 to gain greater market share if successful[12] Interior Design Outlook The Interior Design segment is expected to contribute positively to the Group in H2 2023, leveraging existing projects, a loyal customer base, and design strengths, focusing on developer show units and residential projects for high-net-worth individuals - This business segment is expected to make a positive contribution to the Group in H2 FY2023, leveraging existing projects and a loyal customer base[13] - The interior design team will focus not only on designing new show units for developers but also on residential projects for high-net-worth individuals[13] Financial Review The Group's revenue grew 3.7% to S$46.3 million, but gross margin fell to 27.6%, and profit for the period decreased by 60.9% to S$0.7 million; liquidity is strong, no interim dividend was declared, and listing proceeds are fully utilized Overall Financial Review The Group's revenue grew 3.7% to S$46.3 million, but gross margin decreased from 29.5% to 27.6%, and profit for the period fell 60.9% to S$0.7 million, mainly due to reduced profitability in US furniture sales and higher selling expenses | Metric | 2023年6月30日 (S$ thousand) | 2022年6月30日 (S$ thousand) | Change | | :--- | :--- | :--- | :--- | | Revenue | 46,300 | 44,700 | 3.7% Increase | | Gross Margin | 27.6% | 29.5% | (1.9%) Decrease | | Profit | 700 | 1,900 | (60.9%) Decrease | - The decrease in gross margin was primarily due to reduced profitability in the Group's US furniture sales segment[14] - The decrease in profit was mainly due to reduced profitability in the Group's US furniture sales segment and increased selling and distribution expenses[14] Liquidity, Financial Resources, and Capital Structure As of June 30, 2023, the Group's total borrowings were S$47 thousand, with cash and cash equivalents totaling S$24.3 million; the current ratio was 3.2 and debt-to-equity ratio was 0.1%, with the Board deeming working capital sufficient | Metric | 2023年6月30日 (S$ thousand) | 2022年12月31日 (S$ thousand) | | :--- | :--- | :--- | | Total Borrowings | 47 | 55 | | Total Cash and Cash Equivalents | 24,300 | 20,900 | | Total Current Assets | 75,600 | 77,300 | | Total Current Liabilities | 23,800 | 25,200 | | Current Ratio | 3.2 | 3.1 | | Debt-to-Equity Ratio | 0.1% | 0.1% | - The Board believes the Group's working capital is sufficient to fund its operations and future development plans[18] Foreign Currency Risk The Group's reporting currency is SGD, with sales in USD and SGD, and purchases in USD and EUR, making it susceptible to exchange rate fluctuations against SGD for USD, EUR, and HKD, with no hedging agreements currently in place - The Group is exposed to currency exchange rate fluctuations of USD, EUR, and HKD against SGD[25] - The Group has not entered into any agreements to hedge exchange rate risks related to any foreign currencies[25] Employees and Remuneration Policy As of June 30, 2023, the Group had 130 full-time employees with staff costs of approximately S$4.4 million, offering competitive remuneration, participating in national pension schemes, and providing internal training programs | Metric | 2023年6月30日 | | :--- | :--- | | Number of Full-time Employees | 130 | | Staff Costs (S$ thousand) | 4,400 | - The Group provides employees with competitive salaries, allowances, and performance bonuses based on individual performance, contribution to the Group's performance, and relevant work experience[26] - The Group participates in Singapore's national pension scheme, contributing to the Central Provident Fund, and offers internal training programs[26] Group Pledged Assets As of June 30, 2023, the Group had unutilized bank facilities totaling S$4.8 million, with approximately S$2.5 million secured by debentures creating fixed and floating charges over all existing and future properties and assets of subsidiary Buylateral Group Pte. Ltd | Metric | 2023年6月30日 (S$ thousand) | 2022年12月31日 (S$ thousand) | | :--- | :--- | :--- | | Unutilized Bank Facilities | 4,800 | 5,400 | - Approximately S$2.5 million was secured by debentures creating fixed and floating charges over all existing and future properties and assets of subsidiary Buylateral Group Pte. Ltd[27] Future Plans for Material Investments and Capital Assets As of June 30, 2023, the Group had no other future plans for material investments and capital assets - As of June 30, 2023, the Group had no other plans for material investments and capital assets[28] Material Investments, Acquisitions, and Disposals For the period ended June 30, 2023, the Group had no material investments, acquisitions, or disposals of assets, subsidiaries, associates, or joint ventures - For the period ended June 30, 2023, the Group had no material investments, acquisitions, or disposals of assets, subsidiaries, associates, or joint ventures[29] Interim Dividend The Board resolved not to declare any interim dividend for the period ended June 30, 2023 - The Board resolved not to declare any interim dividend for the period ended June 30, 2023[31] Use of Net Proceeds from Listing The Company's shares were listed on the HKEX on April 25, 2019, with net proceeds of HK$105.2 million (approximately S$18.2 million) fully utilized by December 31, 2022 - The net proceeds from the listing, totaling HK$105.2 million (approximately S$18.2 million), were fully utilized by December 31, 2022[32] Purchase, Sale or Redemption of the Company's Listed Securities For the period ended June 30, 2023, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities - For the period ended June 30, 2023, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[33] Events After Reporting Period No significant subsequent events occurred after the reporting period and up to the date of this report - No significant subsequent events occurred after the reporting period and up to the date of this report[34] Financial Statements This section presents the interim condensed consolidated financial statements for the six months ended June 30, 2023, including statements of profit or loss, financial position, changes in equity, and cash flows Interim Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income For the six months ended June 30, 2023, the Group reported revenue of S$46,345 thousand, gross profit of S$12,809 thousand, profit before tax of S$1,061 thousand, and profit for the period of S$733 thousand, with basic and diluted earnings per share attributable to owners of the Company at 0.03 cents Interim Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (For the six months ended June 30) | Metric | 2023年 (S$ thousand) | 2022年 (S$ thousand) | Change | | :--- | :--- | :--- | :--- | | Revenue | 46,345 | 44,698 | 3.7% Increase | | Cost of Sales | (33,536) | (31,498) | 6.5% Increase | | Gross Profit | 12,809 | 13,200 | (3.0%) Decrease | | Profit Before Tax | 1,061 | 2,545 | (58.3%) Decrease | | Profit for the Period | 733 | 1,873 | (60.9%) Decrease | | Earnings Per Share Attributable to Owners of the Company (cents) | 0.03 | 0.08 | (62.5%) Decrease | Interim Condensed Consolidated Statement of Financial Position As of June 30, 2023, the Group's total non-current assets were S$15,174 thousand, total current assets were S$75,610 thousand, total current liabilities were S$23,844 thousand, and net assets were S$54,845 thousand Interim Condensed Consolidated Statement of Financial Position (As at June 30) | Metric | 2023年 (S$ thousand) | 2022年 (S$ thousand) | Change | | :--- | :--- | :--- | :--- | | Total Non-current Assets | 15,174 | 16,389 | (7.4%) Decrease | | Total Current Assets | 75,610 | 77,264 | (2.1%) Decrease | | Inventories | 37,824 | 43,471 | (13.0%) Decrease | | Cash and Cash Equivalents | 24,292 | 20,874 | 16.4% Increase | | Total Current Liabilities | 23,844 | 25,195 | (5.4%) Decrease | | Net Assets | 54,845 | 55,136 | (0.5%) Decrease | Interim Condensed Consolidated Statement of Changes in Equity For the six months ended June 30, 2023, total equity attributable to owners of the Company was S$52,600 thousand, non-controlling interests were S$2,245 thousand, and total equity was S$54,845 thousand; total comprehensive income for the period was S$1,015 thousand, with dividends paid of S$1,306 thousand Interim Condensed Consolidated Statement of Changes in Equity (For the six months ended June 30) | Metric | 2023年6月30日 (S$ thousand) | 2022年1月1日 (S$ thousand) | | :--- | :--- | :--- | | Total Equity Attributable to Owners of the Company | 52,600 | 52,075 | | Non-controlling Interests | 2,245 | 2,855 | | Total Equity | 54,845 | 54,930 | | Total Comprehensive Income for the Period | 1,015 | 2,750 | | Dividends | (1,306) | (3,533) | Interim Condensed Consolidated Statement of Cash Flows For the six months ended June 30, 2023, net cash flow from operating activities was S$5,805 thousand, net cash used in investing activities was S$(2,170) thousand, net cash used in financing activities was S$(1,980) thousand, and cash and cash equivalents at period-end were S$14,668 thousand Interim Condensed Consolidated Statement of Cash Flows (For the six months ended June 30) | Metric | 2023年 (S$ thousand) | 2022年 (S$ thousand) | Change | | :--- | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | 5,805 | (10,086) | Switched from outflow to inflow | | Net Cash Flow (Used in)/from Investing Activities | (2,170) | 6,627 | Switched from inflow to outflow | | Net Cash Flow Used in Financing Activities | (1,980) | (2,159) | Outflow decreased | | Cash and Cash Equivalents at End of Period | 14,668 | 14,304 | 2.5% Increase | Notes to the Interim Condensed Consolidated Financial Statements This section provides detailed notes to the interim condensed consolidated financial statements, covering company information, accounting policies, judgments and estimates, financial risk management, segment information, revenue, profit before tax, income tax, dividends, earnings per share, balance sheet items, and cash flow notes, offering context and specific explanations for financial data Company Information (Note 1) The Company was incorporated in the Cayman Islands on March 29, 2018, primarily engaged in interior design, furniture sales (including project sales), and US furniture sales - The Company is an investment holding company, with principal activities including interior design, furniture sales (including project sales), and US furniture sales[55] Summary of Significant Accounting Policies (Note 2) The interim condensed consolidated financial statements are prepared in accordance with IAS 34, consistent with 2022 annual financial statements, with no material impact from newly adopted standards - The interim financial statements are prepared in accordance with International Accounting Standard 34 'Interim Financial Reporting'[56] - The accounting policies are consistent with those adopted in the 2022 annual consolidated financial statements, and newly adopted standards have no impact on the interim condensed consolidated financial statements[57][58] Significant Accounting Judgments and Estimates (Note 3) Preparing interim condensed consolidated financial statements requires management judgments, estimates, and assumptions, where uncertainties may lead to significant adjustments to the carrying amounts of affected assets or liabilities in future periods - The preparation of interim condensed consolidated financial statements requires management to make judgments, estimates, and assumptions, and these uncertainties may lead to significant adjustments to the carrying amounts of affected assets or liabilities in future periods[59] Financial Risk Management (Note 4) The Group's activities expose it to credit, foreign exchange, liquidity, and capital risks, with no changes to its financial risk management policies since the financial year ended December 31, 2022 - The Group's activities expose it to credit risk, foreign exchange risk, liquidity risk, and capital risk[61] - There have been no changes to the Group's financial risk management policies since the financial year ended December 31, 2022[62] Segment Information (Note 5) The Group reports across four operating segments: Interior Design, Furniture Sales, US Furniture Sales, and Corporate; for the six months ended June 30, 2023, US Furniture Sales had the highest revenue but lower segment results, with primary operations in Singapore and the US - The Group has four reportable operating segments: Interior Design, Furniture Sales, US Furniture Sales, and Corporate[67] Segment Revenue (For the six months ended June 30, 2023) | Segment | Revenue (S$ thousand) | | :--- | :--- | | Interior Design | 2,490 | | Furniture Sales | 12,856 | | US Furniture Sales | 30,999 | | Corporate | – | | Total | 46,345 | Segment Results (For the six months ended June 30, 2023) | Segment | Results (S$ thousand) | | :--- | :--- | | Interior Design | 315 | | Furniture Sales | 1,613 | | US Furniture Sales | 41 | | Corporate | (908) | | Total | 1,061 | - The Group's operating segments operate in Singapore (Interior Design and Furniture Sales) and the United States (US Furniture Sales)[71][72] Revenue (Note 6) Revenue represents the net invoiced value of goods sold and services rendered after deducting provisions for returns and trade discounts; for the six months ended June 30, 2023, revenue from goods sold was S$43,855 thousand and service income was S$2,490 thousand, primarily from Singapore and US markets Disaggregated Revenue Information (For the six months ended June 30, 2023) | Type of Goods or Services | Revenue (S$ thousand) | | :--- | :--- | | Sale of goods | 43,855 | | Service income — Interior design | 2,490 | | Total revenue from contracts with customers | 46,345 | Revenue by Geographical Market (For the six months ended June 30, 2023) | Geographical Market | Revenue (S$ thousand) | | :--- | :--- | | Singapore | 15,346 | | United States | 30,999 | | Total revenue from contracts with customers | 46,345 | Profit Before Tax (Note 7) The Group's profit before tax is stated after deducting or crediting various expenses, including cost of goods sold of S$32,302 thousand, cost of services provided of S$1,234 thousand, depreciation of S$452 thousand, amortization of right-of-use assets of S$1,625 thousand, and employee benefit expenses of S$4,434 thousand Key Deductions/Credits in Profit Before Tax (For the six months ended June 30) | Item | 2023年 (S$ thousand) | | :--- | :--- | | Cost of goods sold | 32,302 | | Cost of services provided | 1,234 | | Depreciation | 452 | | Amortisation of right-of-use assets | 1,625 | | Employee benefit expenses | 4,434 | | Net provision for write-down of inventories to net realisable value | 65 | | Net provision for expected credit losses on trade receivables | 180 | Income Tax (Note 8) For the six months ended June 30, 2023, income tax expense primarily originated from Singapore, with an expense of S$338 thousand for the period, resulting in a total income tax expense of S$328 thousand Income Tax Expense (For the six months ended June 30) | Item | 2023年 (S$ thousand) | | :--- | :--- | | Current — Singapore: Expense for the period | 338 | | Current — Singapore: Over-provision in prior years | (10) | | Total | 328 | Dividends (Note 9) The Board resolved not to declare any interim dividend for the period ended June 30, 2023 - The Board resolved not to declare any interim dividend for the period ended June 30, 2023[84] Earnings Per Share Attributable to Owners of the Company (Note 10) Basic earnings per share of 0.03 cents is calculated based on profit for the period attributable to owners of the Company of S$656 thousand and the weighted average of 2,000,000,000 ordinary shares outstanding during the period Earnings Per Share (For the six months ended June 30) | Metric | 2023年 | | :--- | :--- | | Profit for the period attributable to owners of the Company (S$ thousand) | 656 | | Weighted average number of ordinary shares outstanding (shares) | 2,000,000,000 | | Basic and diluted earnings per share (cents) | 0.03 | Property, Plant and Equipment (Note 11) For the six months ended June 30, 2023, the Group purchased assets at a cost of approximately S$687 thousand, a significant increase compared to the same period last year Additions to Property, Plant and Equipment (For the six months ended June 30) | Metric | 2023年 (S$ thousand) | 2022年 (S$ thousand) | | :--- | :--- | :--- | | Cost of assets purchased | 687 | 73 | Right-of-Use Assets (Note 12) For the six months ended June 30, 2023, the Group entered into new leases, recognizing right-of-use assets and lease liabilities of approximately S$87 thousand Additions to Right-of-Use Assets and Lease Liabilities (For the six months ended June 30) | Metric | 2023年 (S$ thousand) | 2022年 (S$ thousand) | | :--- | :--- | :--- | | New right-of-use assets | 87 | 1,600 | | New lease liabilities | 87 | 1,600 | Inventories (Note 13) As of June 30, 2023, the Group's total inventories were S$37,824 thousand, a decrease from S$43,471 thousand on December 31, 2022, primarily comprising merchandise and goods in transit Composition of Inventories (As at June 30) | Item | 2023年 (S$ thousand) | 2022年 (S$ thousand) | | :--- | :--- | :--- | | Merchandise | 33,647 | 38,210 | | Goods in transit | 4,177 | 5,261 | | Total | 37,824 | 43,471 | Trade Receivables (Note 14) As of June 30, 2023, net trade receivables were S$10,256 thousand, with the highest proportion aged within one month; the Group maintains strict control over all outstanding receivables, with an expected credit loss provision of S$614 thousand Trade Receivables (As at June 30) | Metric | 2023年 (S$ thousand) | 2022年 (S$ thousand) | | :--- | :--- | :--- | | Trade receivables | 10,870 | 10,642 | | Provision for expected credit losses | (614) | (463) | | Net | 10,256 | 10,179 | Ageing Analysis of Trade Receivables (As at June 30) | Ageing | 2023年 (S$ thousand) | | :--- | :--- | | Within 1 month | 7,559 | | 1 to 2 months | 2,419 | | 2 to 3 months | 43 | | Over 3 months | 235 | - The Group seeks to maintain strict control over all its outstanding receivables and implements credit monitoring to minimize credit risk[93] Cash and Cash Equivalents (Note 15) As of June 30, 2023, the Group's total cash and cash equivalents were S$24,292 thousand, primarily comprising cash and bank balances of S$14,668 thousand and fixed deposits of S$9,624 thousand Composition of Cash and Cash Equivalents (As at June 30) | Item | 2023年 (S$ thousand) | 2022年 (S$ thousand) | | :--- | :--- | :--- | | Cash and bank balances | 14,668 | 12,971 | | Fixed deposits | 9,624 | 7,903 | | Total | 24,292 | 20,874 | Trade Payables (Note 16) As of June 30, 2023, the Group's total trade payables were S$3,231 thousand, primarily aged within one month, unsecured, and interest-free Ageing Analysis of Trade Payables (As at June 30) | Ageing | 2023年 (S$ thousand) | 2022年 (S$ thousand) | | :--- | :--- | :--- | | Within 1 month | 2,720 | 2,861 | | 1 to 2 months | 279 | 350 | | 2 to 3 months | 39 | 144 | | Over 3 months | 193 | 161 | | Total | 3,231 | 3,516 | - The Group's trade payables are unsecured, interest-free, and generally settled on average credit terms of 30 to 60 days[99] Other Payables and Accrued Expenses (Note 17) As of June 30, 2023, total other payables and accrued expenses were S$8,100 thousand, primarily comprising accrued expenses of S$4,870 thousand and customer sales return estimates of S$1,278 thousand Composition of Other Payables and Accrued Expenses (As at June 30) | Item | 2023年 (S$ thousand) | 2022年 (S$ thousand) | | :--- | :--- | :--- | | Accrued expenses | 4,870 | 6,175 | | Customer sales return estimates | 1,278 | 2,231 | | Other payables | 646 | 430 | | Dividends payable | 1,306 | – | | Total | 8,100 | 8,836 | Share Capital (Note 18) As of June 30, 2023, the Company's issued and fully paid share capital comprised 2,000,000,000 shares with a total par value of S$3,453 thousand; the 2022 final dividend of 0.38 HK cents per share was approved by shareholders and paid on June 21, 2023 Issued Share Capital (As at June 30) | Metric | 2023年 (S$ thousand) | 2022年 (S$ thousand) | | :--- | :--- | :--- | | Issued share capital | 3,453 | 3,453 | | Share premium | 9,977 | 11,283 | - The 2022 final dividend of 0.38 HK cents per share was approved by shareholders on June 21, 2023, and fully paid out from the share premium account in accordance with the Articles of Association and the Companies Act of the Cayman Islands[104] Notes to the Consolidated Statement of Cash Flows (Note 19) This note details cash flows for property, plant, and equipment additions, with S$667 thousand invested in H1 2023; financing activities saw a decrease of S$8 thousand in borrowings and S$1,577 thousand in lease liabilities Cash for Additions to Property, Plant and Equipment (For the six months ended June 30) | Metric | 2023年 (S$ thousand) | 2022年 (S$ thousand) | | :--- | :--- | :--- | | Cash invested in property, plant and equipment | 667 | 73 | Changes in Financing Activities Assets and Liabilities (January 1 to June 30, 2023) | Item | Changes in cash flows from financing activities (S$ thousand) | | :--- | :--- | | Borrowings | (8) | | Lease liabilities | (1,577) | Other Information This section discloses directors' and substantial shareholders' interests, share option scheme, competing interests, corporate governance practices, and interim results review; directors and substantial shareholders hold significant shares, the share option scheme is adopted but ungranted, the company complies with corporate governance code, and interim results have been reviewed Directors' and Chief Executive's Interests in Shares, Underlying Shares and Debentures of the Company and its Associated Corporations As of June 30, 2023, Mr. Ruan Youren and Ms. Wee Ai Quey held 45% of the Company's shares through controlled corporations, while Mr. Gao Quantai held 30% directly and through controlled corporations Directors' Shareholdings (As at June 30, 2023) | Director's Name | Nature of Interest | Number of Shares Held | Approximate Percentage | | :--- | :--- | :--- | :--- | | Mr. Ruan Youren | Interest in controlled corporation | 900,000,000 | 45% | | Ms. Wee Ai Quey | Interest in controlled corporation | 900,000,000 | 45% | | Mr. Gao Quantai | Beneficial owner and interest in controlled corporation | 600,000,000 | 30% | - Mr. Ruan Youren and Ms. Wee Ai Quey are both deemed to have interests in the shares held by Nobel Design International Limited[110] - Mr. Gao Quantai directly holds 300,000,000 shares and is deemed to have an interest in the shares held by St. Louis Holdings Pte. Ltd[110] Substantial Shareholders' Interests and Short Positions in Shares and Underlying Shares As of June 30, 2023, except for directors, Nobel Design International Limited held 45% of shares, St. Louis Holdings Pte. Ltd. held 15%, and several spouses of directors were also deemed to have relevant interests Substantial Shareholders' Shareholdings (As at June 30, 2023) | Name/Designation | Capacity/Nature of Interest | Number of Shares Held | Approximate Percentage | | :--- | :--- | :--- | :--- | | Nobel Design International Limited | Beneficial owner | 900,000,000 | 45% | | Ms. Beh Pur-Lin Elaine | Interest of spouse | 900,000,000 | 45% | | Mr. Tan Thiam Siew | Interest of spouse | 900,000,000 | 45% | | St. Louis Holdings Pte. Ltd. | Beneficial owner | 300,000,000 | 15% | | Ms. Sng Su Ying Marian | Interest of spouse | 600,000,000 | 30% | - Ms. Beh Pur-Lin Elaine, spouse of Mr. Ruan Youren; Mr. Tan Thiam Siew, spouse of Ms. Wee Ai Quey; and Ms. Sng Su Ying Marian, spouse of Mr. Gao Quantai, are all deemed to have relevant interests under the Securities and Futures Ordinance[112][120] Directors' Rights to Acquire Securities Since the Company's incorporation, no rights have been granted to any director, their spouses, or children under 18 to acquire benefits through purchasing shares or debentures of the Company or any other body corporate - Since the Company's incorporation, no rights have been granted to any director, their respective spouses, or children under 18, enabling them to obtain benefits by acquiring shares or debentures of the Company or any other body corporate[116] Share Option Scheme The Company adopted a share option scheme on March 28, 2019, to reward contributors to the Group; as of this report date, 200,000,000 shares, representing 10% of the Company's issued shares, remain unexercised under the scheme - The Company adopted a share option scheme on March 28, 2019, to reward and incentivize individuals who have contributed to the Group[117] - As of the date of this report, 200,000,000 shares, representing 10% of the Company's issued shares, remain unexercised under the share option scheme[117] Competing Interests As of the date of this report, no director, controlling shareholder, or their respective associates had any interest in any business that directly or indirectly competes or may compete with the Group's business - As of the date of this report, no director, controlling shareholder, or their respective associates had any interest in any business that directly or indirectly competes or may compete with the Group's business[118] Corporate Governance The Company adopted the Corporate Governance Code in Appendix 14 of the Listing Rules and, except for the unseparated roles of Chairman and CEO, complied with applicable code provisions; the Board believes Mr. Ruan Youren's dual role is in the Group's best interest, with sufficient non-executive and independent non-executive directors to balance power - The Company has adopted the principles and code provisions of the Corporate Governance Code set out in Appendix 14 of the Listing Rules as the basis for its corporate governance practices[119] - The Board believes that for the six months ended June 30, 2023, the Company has complied with the applicable code provisions of the Corporate Governance Code, except for code provision C.2.1 (which states that the roles of chairman and chief executive should be separate)[122] - The Board believes that Mr. Ruan Youren's dual role is in the best interests of the Group, and with a majority of non-executive directors and independent non-executive directors providing independent judgment, his dual role will not impair the balance of power and authority of the Board[122] Standard Securities Dealing Code The Company adopted the Standard Securities Dealing Code for directors of listed issuers in Appendix 10 of the Listing Rules, and established written guidelines for employees with inside information that are no less stringent than the Code; no directors were found to have breached the Code upon inquiry - The Company has adopted the Standard Securities Dealing Code for directors of listed issuers as set out in Appendix 10 of the Listing Rules[123] - The Company has also established written guidelines for employees who may possess unpublished inside information regarding securities dealings, with these guidelines being no less stringent than the Standard Code[123] - As of June 30, 2023, based on specific inquiries made by the Company to all directors, no director was found to have breached the Standard Code[124] Review of Interim Results The Audit Committee has reviewed the unaudited financial information in this report, but the Company's auditors have not yet audited or reviewed it - The Audit Committee has reviewed the unaudited financial information in this report[126] - The Company's auditors have not yet audited or reviewed the unaudited financial information in this report[126]