Interim results for six months ended 30 June 2023

CRUSHMETRIC Group Limited
02 October 2023
 

2 October 2023

 

 

CRUSHMETRIC Group Limited

("CRUSHMETRIC", the "Group" or the "Company")

 

Interim results for the six months ended 30 June 2023

 

 

Chief Executive Officer's Statement

 

CRUSHMETRIC Group Limited (AQUIS: CUSH), the consumer design and production group announces the results of the Company and its subsidiaries for the six month period ended 30 June 2023.

 

The Company was formerly engaged in TCM healthcare, as well as the production and sale of skincare products.  The board took the view that the Company would have to change focus in the light of the Covid pandemic.  Thus during 2022, the nature of the Company's operations and its principal activities were changed to acting as the holding company of a group engaged in (i) design and production that integrates shape changing technology ("CRUSH") into a catalogue of products designed and invented by the artist and co-founder of CRUSHMETRIC Limited, Noah Deledda, and his team. This technology is built on his own series of dented aluminium can sculptures and (ii) the sale and distribution of the CRUSHMETRIC products through online and offline channels worldwide.

 

This announcement contains inside information as defined in Article 7 of the Market Abuse Regulation No. 596/2014 and is disclosed in accordance with the Company's obligations under Article 17 of those Regulations.

 

 

Financial highlights

 

·  Revenue for the six months ended 30 June 2023: HK$1,040,509 (30 June 2022: HK$7,969,835)

·  Gross profit for the six months ended 30 June 2023: HK$728,143 (30 June 2022: HK$3,781,756)

·  Loss for the six months ended 30 June 2023: HK$3,813,095 (30 June 2022: HK$908,874)

· The basic and diluted loss per share for the six months ended 30 June 2023: HK$0.02 (30 June 2022: HK$0.01)

·  The Group's cash position as at 30 June 2023: HK$1,450,559 (30 June 2022: HK$333,150)

 

 

Review of significant activities

 

(a)  CONVERTIBLE BONDS

 

(i)   Renewal of Convertible Bond 1: Principal Amount USD650,000

 

On 29 June 2023, the Group entered into an extension agreement for the Convertible Bond. The maturity date has been extended to 19 July 2024 and the Coupon payment of the CB will be adjusted to six percent (6%) per annum payable in cash plus three percent (3%) per annum payable in Ordinary Shares of the Group for the first nine months from 20 January 2023 to 19 October 2023 and the Coupon payment of the CB will be six percent (6%) per annum payable in cash plus four percent (4%) per annum payable in Ordinary Shares of the Group for the period from 20 October 2023 to 19 July 2024. All other terms remain unchanged.

 

(ii)  Convertible Bond 2: Principal Amount SGD250,000

On 24 February 2023, the Group entered into an agreement to issue an unsecured convertible bond ("the Bond") to Future Vision Pte. Ltd ("Future"). Future has agreed to subscribe in cash for the Bond for a principal amount of SGD$250,000 (approximately £150,820). The Bond has a coupon of ten percent (10%) per annum.

 

The Bond, at the election of Future may be converted into ordinary shares of the Group ("Underlying shares") or will otherwise be redeemable at maturity on 23rd February 2026. The Bond shall be convertible into the Underlying Shares at an Exchange Price which is calculated at a GBP 0.2 per share where 50% of the Bond can be converted within the first year and the rest can be converted on the Maturity Date at the discretion of Future.

 

(iii) Convertible Bond 3: Principal Amount USD1,000,000

 

On 11 April 2023, the Group entered into an agreement with Sky Solar HK Investments Limited ("Sky") to issue an unsecured convertible bond ("the Bond") to Sky. Sky agreed to subscribe in cash for the Bond for a principal amount of USD$1,000,000 (approximately £790,400). The bond has a coupon of ten percent (10%) per annum.

 

The Bond, at the election of Sky, may be converted into ordinary shares of the Group ("Underlying shares") or will otherwise be redeemable three years from the date of receipt of the Principal Amount. The Bond shall be convertible into the Underlying Shares at an Exchange Price which is calculated at a GBP 0.2 per share where 50% of the Bond can be converted within the first year, 25% of the Bond can be converted in the second year and the rest of 25% can be converted on the Maturity Date at the discretion of Sky.

 

(b)  CHANGE OF WORKING ADDRESS

On 23 April 2023, one of the Group's subsidiaries, CRUSHMETRIC eCommerce (HK) Limited entered into a tenancy agreement for a fixed term of two years for a new office located in Hong Kong from which the Group will henceforth carry on its business.

 

 

Financial review

 

(i) Income statement items

 

The Group's revenue for the six months ended 30 June 2023 amounted to HK$1,040,509, a decrease of HK$6,929,326 or 86.94% as compared to the six months ended 30 June 2022. This was attributable to decreased revenue generated from sales of CRUSHMETRIC SwitchPens by approximately HK$5,626,000. The Group's gross profits and gross profit margin for the six months ended 30 June 2023 amounted to HK$728,143 and 69.98% (30 June 2022: HK$3,781,756 and 47.45%) respectively.

 

The Group's distribution costs for the six months ended 30 June 2023 amounted to HK$111,552, a decrease of HK$102,640 or 47.92% as compared to the same period in 2022. The Group's administrative expenses for the six months ended 30 June 2023 amounted to HK$4,224,302, a decrease of HK$320,487 or 8.21% as compared to the six months ended 30 June 2022.

 

The Finance Costs for the six months ended 30 June 2023 amounted to HK$502,141, this was related to the interest expenses for the convertible bond.

 

The unaudited net loss for the period ended 30 June 2023 shows an increase of HK$2,904,221 and 319.54% compared to the same period in 2022. This was attributable to the decrease of sales and increase of administrative expenses by the Group during the period.

 

The Directors do not recommend the payment of a dividend in respect of the period.

 

The interim results have not been reviewed by the Company's auditor.

 

 

(ii) Balance sheet items

 

The Group's tangible fixed assets mainly comprised office equipment, decreased in amount by HK$144,031 as at 30 June 2023, compared to the same period in 2022, mainly due to the depreciation in value of office equipment.

 

The Group's inventories as at 30 June 2023 amounted to HK$317,424 with a decrease of HK$78,084 over the balance as at 30 June 2022.

The Group's other receivables and prepayments as at 30 June 2022 decreased by HK$149,971 or 7.17% compared to the same period in 2021.

 

The Group's trade payables as at 30 June 2023 amounted to HK$3,502,655 with a decrease of HK$4,846,272 over the balance as at 30 June 2022, this was mainly due to the acquisition of a vendor in December 2022.

 

The Group's cash and cash equivalents increased by HK$1,117,409 as at 30 June 2023 compared to 30 June 2022.

 

 

Outlook

 

The Company has transformed its business to a consumer product Group that is focused on selling various innovative products to the market.

 

We've faced a decrease in sales in the first half years as the Company has dedicated more resources for new product research and preparation. We took some time in searching for social media and marketing partners better suited to the marketing and distribution online, of the CRUSHMETRIC series of products through both our own website as well as Amazon and other marketing partners. We believe these partnerships will help the Company reach out to a more targeted audience and customers that will result in increased revenue in the second half of the coming year.

 

The launch of our new product - the Tumbler, was delayed but we are confident that it will be launched by the end of the year and we expect this to result improved sales and better returns. The Group will continue to focus on promoting and generating more sales from the CRUSHMETRIC series of products which we have launched; together with the Tumbler to be launched soon.

 

The Board will continue to take all reasonable efforts to ensure that sufficient working capital is maintained. The Board's objective is the same as previous years, which is to protect and safeguard as well as improve the business, to minimise cost and generate more sales income through online products.

 

On behalf of the Board of Directors, I would like to thank our management and staff for the great loyalty and dedication they continue to show through these delicate times. I would also like to extend our utmost appreciation to all our partners, shareholders, customers, business associates and suppliers, for their continued support.   

 

The Directors of the Company accept responsibility for the contents of this announcement.

 

Ivor Colin Shrago

Chairman

 

 

 

For further information, please contact:-

 

CRUSHMETRIC Group Limited

ONG Ban Poh Michael - Chief Executive Officer

Lilian Lo - Acting Chief Financial Officer

 

Tel: +852 2110 4221

 

Aquis Growth Market Corporate Adviser

PETERHOUSE CAPITAL LIMITED

Guy Miller

Mark Anwyl

Tel: +44 (0)20 7469 0930 

 

CRUSHMETRIC Group Limited

Consolidated Statement of Comprehensive Income

For the six months ended 30 June 2023

 

 

 

The Group

 

 

 

Unaudited

 

Unaudited

 

Audited

 

 

6 months ended 30 June 2023

 

6 months ended 30 June 2022

 

Year ended 31 December 2022

 

 

HK$

 

HK$

 

HK$

From continuing operations

 

 

 

 

 

 


 


 




Revenue

 

1,040,509

 

7,969,835


10,826,825

Cost of sales

 

(312,366)

 

(4,188,079)


(6,422,471)

Impairment loss on inventory

 

-

 

-


-,


 


 




 

 


 




Gross profit

 

728,143

 

3,781,756


4,404,354


 


 




Other revenue

 

679,246

 

125,108


1,646,139

Distribution costs

 

(111,552)

 

(214,192)


(393,306)

Administrative expenses

 

(4,224,302)

 

(3,903,815)


(11,049,827)

Foreign exchange gains/(losses), net

 

(386,192)


(117,317)


(266,084)

 

 


 




 

 


 




Operating loss

 

(3,314,657)

 

(328,460)


(5,658,724)

 

 


 




Impairment loss on trade receivable

 

-

 

(24,830)


(45,759)

Finance costs

 

(502,141)

 

(555,945)


(86,398)

Interest income

 

3,703

 

361


433

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss before taxation


(3,813,095)


(908,874)


(5,790,448)

Taxation


-


-


(57,594)

 

 

 

 

 

 

 








Loss for the period/year


(3,813,095)


(908,874)


(5,848,042)


 


 




Other comprehensive income

 

 

 




Exchange differences arising from translation

 

485,461

 

550,758


1,010,343

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total comprehensive result for the period/year

 

(3,327,634)

 

(358,116)


 

(4,837,699)

 

 


 




 

 


 




Loss for the period/year attributable to:

 


 




Equity holders of the parent entity

 

(3,913,831)

 

(904,339)


(5,595,532)

Non-controlling interests

 

100,736

 

(4,535)


(252,510)


 


 




 

 

(3,813,095)

 

(908,874)


(5,848,042)

 

 


 




Total comprehensive loss for the period/year attributable to:

 


 




Equity holders of the parent entity

 

(3,428,370)

 

(353,581)


(4,585,189)

Non-controlling interests

 

100,736

 

(4,535)


(252,510)

 

 


 




 

 

 

 

 

 

 

(3,327,634)

(358,116)

(4,837,699)

 







Loss per share - from continuing operations (HK$)







Basic and diluted


(0.02)


(0.01)


(0.06)



Loss per share - from continuing operations

 

The calculation of basic loss per share is based on the consolidated loss attributable to the equity holders of the parent entity of HK$3,913,831 (For the six months ended 30 June 2022: Loss of HK$904,339; For the 12 months ended 31 December 2022: Loss of HK$5,595,532) and the weighted average number of ordinary shares of 239,933,283 (For the six months ended 30 June 2022 weighted average number of ordinary shares of 85,606,051; For the 12 months ended 31 December 2022: 89,655,922) in issue during the period.

 

 

 

 

 

CRUSHMETRIC Group Limited

Consolidated Statement of Financial Position

As at 30 June 2023

 

 

Unaudited

As at 30 June 2023

 

Unaudited

As at 30 June 2022

 

 

Audited

As at 31

December

 2022

 

 

HK$

 

HK$

 

HK$

Assets

 


 




Non-current assets

 


 




Fixed assets

 

185,391

 

41,360


221,258

Other intangible assets

 

-

 

2,678,572


-

Right-of-use assets

 

199,389

 

266,793


370,640

Goodwill

 

293,993,592

 

-


293,993,592

 

 

 

 

 

 

 

 

 

 

 

 

 


 

 

294,378,372

 

2,986,725

 

294,585,490

 

 


 


 

 

 

 


 


 

 

Current assets

 


 


 

 

Inventories

 

317,424

 

395,508


341,561

Trade receivables

 

904,977

 

2,051,407


757,271

Other receivables and prepayments

 

1,197,284

 

1,940,336


1,162,149

Cash and cash equivalents

 

1,450,559

 

333,150


128,658

 

 


 



 





 

3,870,244

 

4,720,401


2,389,639

 

 


 


 

 


 


Total assets

 

298,248,616

 

7,707,126

 

296,975,129


 


 

 


 


 


 

 

Equity and liabilities

 


 


 

 

Equity

 


 


 

 

Share capital

 

1,870,234

 

668,509


1,870,234

Share premium

 

392,450,040

 

97,084,716


392,450,040

Reserve

 

(144,997,379)

 

(137,337,401)


(141,569,009)

 

 


 




 

 


 




Equity attributable to the parent entity

 

249,322,895

 

(39,584,176)


252,751,265

Non-controlling interest

 

(440,910)

 

(293,671)


(541,646)

 

 


 




 

 


 




Total equity

 

248,881,985

 

(39,877,847)

 

252,209,619

 

 


 

 

 

 

 


 


 

 

Liabilities

 


 


 

 

Current liabilities

 


 


 

 

Trade payables

 

3,502,655

 

8,348,927


4,319,057

Other payables and accruals

 

28,174,956

 

29,911,001


31,961,020

Taxation payable

 

57,594

 

-


57,594

Amount due to directors

 

2,927,984

 

3,448,023


2,930,515

Lease liabilities

 

204,648

 

453,305


275,620

Borrowings

 

14,498,794

 

5,423,717


5,106,144


 





 

49,366,631

 

47,584,973


44,649,950

Non-Current liabilities

 


 




Lease liabilities

 

-

 

-


115,560


 


 



 

 


 



Total liabilities

 

49,366,631

 

47,584,973


44,765,510


 


 



 

 


 

 


Total equity and liabilities

 

298,248,616

 

7,707,126

 

296,975,129

 

 

 



The Group's consolidated financial statements for the six months ended 30 June 2022 and 2023 disclosed above have neither been audited nor reviewed by the Company's auditors.

 

The same accounting policies and methods of computation as included in the Group's consolidated financial statements for the year ended 31 December 2022 have been adopted in the preparation of the Group's unaudited consolidated financial statements for the six months ended 30 June 2023.

 

 

 

 

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