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The Group achieved a revenue of S$0.7 million for the financial year 2017 ("FY2017"), which saw a decrease of about 32% comparing the corresponding last financial year. The drop in sales was mainly derived from the slower F&B sales activities for Mulligan's. The outlet saw a decline on the tourist arrival and patronage in the reported year possibly affected by the economical, weather climate and the death of King Bhumibol Adulyadej. The F&B industry is facing slow business trends due to mourning of the late Monarch during the year. Clubs and pubs operations in all venues particularly the tourist sites were demanded to mute on music and songs by the authorities. This has negatively affected sales activity to the outlet's operation. With such regular authority control, operations are indirectly facing difficulty in rolling out marketing and promotion activities. F&B activities are anticipated to improve moderately for the coming months. Trading activities for the year has also contributed to the drop in sales due to the economic slowdown. The club operations continuously work to maintain the Mulligan's brand and concept to sustain sales activities. The management will work strategically with operations to manage the business performance for the Mulligans' outlet.
Miscellaneous income consisting of interest income and other related miscellaneous income dropped by 52% to S$0.02 million in FY2017 mainly due to reversal of related expenses that occurred in FY2016.
Cost & Expenses
Inventories and consumables usage saw a decrease of 47% to S$0.26 million in FY2017. The decrease was mainly due to the lower sales activity for the group in FY2017. Advertising, media and entertainment expenses dropped by 69% to S$0.01 million in FY2017 mainly due to lesser advertising and marketing activities and cost control effort by the operations on such related expenses. Employee benefits saw a decrease of 14% to S$0.8 million in FY2017 mainly due to related cost structure deployment and provisions in the reported year. Amortisation and depreciation decreased by 71% to less than S$0.01 million in FY2017 due to lesser depreciation charges incurred for the year.
The Group saw rental on operating lease increased by 6% to S$0.23 million in FY2017 mainly incurred for rental expenses of head office premises and operations facilities for the year. Legal and professional fees increased by 26% to S$0.33 million in FY2017 as there were more related payout for business consulting and advisory services in the reported year. The Group has taken consistent and effective measures in reducing related cost and expenditures to the business and operations in the reported year. Other operating expenses in FY2017 saw an increase of 19% to S$0.22 million mainly due to the processing and lodgment fee of the right issues exercise incurred in the reported year.
Total expenses in FY2017 dropped by 13% to S$1.85 million mainly due to an effective operations structure and collective effort in reducing and controlling all related expenses. With the drop in sales activities and contained cost structure for the year, the Group registered a loss of S$1.14 million in FY2017 which saw an increase of 7% as compared to the last financial year.
Statement of Financial Position and Statement of Cash Flows
The group's current assets as at 31 July 2017 was S$2.43 million. Non-current assets was stated at approximately S$0.01 million as at 31 July 2017 comprising property, plant and equipment maintained after taking into account of amortisation and depreciation in FY2017.
Cash and cash equivalents increased to S$2.21 as at 31 July 2017 million mainly due to the cash proceeds from the right issues and placement of new shares.
Trade and other receivables decreased to S$0.06 million as at 31 July 2017 due to decrease in other receivables. Other current assets which include security deposit and prepayment remained the same as prior year. Inventory amount increased to S$0.01 million as at 31 July 2017 due to lower sale activities in the reported financial year.
Trade and other payables increased to S$0.34 million as at 31 July 2017. Trade and other payables include trade suppliers' payables, payables to contractors and services, and provisions and accrual in the reported year. The Group has cleared and settled all outstanding loans and has no outstanding loan and non-current liabilities as at 31 July 2017.
The Group generated negative net cash in operating activities of S$1.27 million for FY2017 mainly due to lower sales activities and payment from the outlet operations. Cash flows from investing activities amounting to S$0.02 million for FY2017 was mainly for operations equipment incurred for the outlet concept and the exchange translation of the related entity. Cash flows from financing activities amounted to S$3.41 million for FY2017 due to receive of proceeds from rights issue and placement of shares. Cash and cash equivalents stood at S$2.21 million as at 31 July 2017.
The Group maintained in a positive equity position of S$2.1 million as at 31 July 2017, as compared to a negative equity of S$0.16 million as at 31 July 2016, mainly due to the completion of rights issue and placement of new shares in FY2017.
The Company had on 25 April 2017 announced the completion of the share consolidation of every fifty (50) existing ordinary shares in the capital of the Company into one (1) ordinary share. The Company had on 24 January 2017 announced the proposed the proposed renounceable non-underwritten rights cum warrants issue. The Company updated and announced on 5 June 2017 that 122,399,992 Right Shares and 122,399,992 Warrants were allotted and issued respectively. As per announcement dated 14 July 2017, the Company further completed the placement of 10,420,000 new ordinary shares in the capital of the Company at S$0.048 for each subscription Share. The directors will continue to explore on various fund raising activities and transactions with interested parties to better position the assets and structure of the Group.
The Group continues to remain cautious about the outlook and condition of the overall business environment. The Board is mindful of the intense competition of the industry and will continue to explore business opportunities including fund raising exercise to position and transform its business profile and strategic direction.
The Company announced on 30 August 2017 that the Shareholders through an Extraordinary General Meeting had approved all resolutions on matters related to (1) the proposed acquisition of 100% of the entire issued and paid up share capital of E-Holidays Co.,Ltd.; (2) the proposed diversification of the business of the Group to include the Travel Businesses; (3) the proposed diversification of the business of the Group to include the Fintech Businesses; (4) the proposed diversification of the business of the Group to include the Fund Management Businesses. The Company has further announced on 11 September 2017 the completion on the acquisition of the entire issued and paid up share capital of E-Holidays Co., Ltd.
The Group will update on any further developments on the matter accordingly.