Half-year Report

London, 30 September 2019

GRAND VISION MEDIA HOLDINGS PLC (“GVMH” or the “Company”)

HALF YEARLY REPORT FOR THE SIX MONTHS ENDED 30 JUNE 2019

The CEO’s Report

Overview

General market conditions for the advertising sector were tough in the first six months, primarily caused by the concern of the economic impact and extended timeline of the trade war between US and China.

In the past six months, we have expanded both our network and our presence in the region.  We concluded our partnership agreement with Dadi Cinemas and rolled out our glasses free 3D panels to further twenty cinemas.  We also secured the right to be their sales partner for their cinema advertising assets.

We also signed with strategic partners in Japan and Korea to strengthen our sales presence in those regions, in line with our strategy to capture a larger share of marketing budget targeted at Chinese outbound tourism.

We have also started a pilot project with CJ CGV Cinemas in Korea.  This is a significant development that confirms our cinema-centric model has an appeal that is not unique in China.  We may consider develop similar partnerships in the wider region.

Summary of Trading Results

GVMH Consolidated Results for the 6 Months to 30 June 2019

Revenue in the period was HKD7,886K. The Company had a loss before tax of HKD8,164K. The expenses in the period included listing costs amounting to HKD115K.

GVC Holdings Ltd (“GVCH”) Results for the 6 Months to 30 June 2019

Revenue in the period was HKD7,886K (H1 2018 : HKD7,415K), representing an increase of 6% compared to the same period last year. Despite a tight market, we have been able to deliver more integrated campaigns and marketing events to supplement the traditional OOH advertising revenue.  Revenue from social media marketing also grew by over 10 percent to HKD 2,600K.  GVCH had a loss before tax in the period of HKD7,111K (H1 2018: HKD6,745K).

Outlook

The Successful pilot in Korea with CJ CGV cinemas is a significant development for the Group. As a result, we are in the planning stage of a bigger roll out with the CJ CGV cinemas in Korea. This also encourages us to evaluate the possibility of expanding our network to other Asian countries.

To respond to the changes in the market dynamics, we are making some re-alignment of our strategy to ensure a broad coverage in China whilst focussing in the top ten to fifteen cities in China while enlarging our network through representing other advertising assets within cinemas.  We shall relocate our own glasses free 3D panels to these cities with an aim to achieve a bigger critical mass in those cities. In addition to strengthening existing overseas partnerships, we are in discussions with partners in Asian countries such as Singapore and Thailand.

The luxury goods segment in China continues to grow and we are planning to work with a leading distributor / buying office of luxury fashion brands in China to boost our market access and industry insights, allowing us to better serve clients in this sector. Through this partnership we hope to provide both on-line and off-line marketing services to luxury fashion brands seeking to establish themselves in China.

Responsibility Statement

We confirm that to the best of our knowledge:

a. the condensed set of financial statements has been prepared in accordance with IAS 34 ‘Interim Financial Reporting’;

b. the interim management report includes a fair review of the information required by DTR 4.2.7R (indication of important events during the first six months and description of principal risks and uncertainties for the remaining six months of the year; and,

c. the interim management report includes a fair review of the information required by DTR 4.2.8R (disclosure of related parties’ transactions and changes therein).

Cautionary statement

This Interim Management Report (IMR) has been prepared solely to provide additional information to shareholders to assess the Company’s strategies and the potential for those strategies to succeed. The IMR should not be relied on by any other party or for any other purpose.

The condensed accounts have not been reviewed by the auditors.

Jonathan Lo
Chief Executive Officer

Date : 27 September 2019

Interim Condensed Statement of Comprehensive Income

	Notes	GVMH 6 months Ended 30 June 2019	GVMH 6 months Ended 30 June 2018	GVMH Year End 31 December 2018
		HK$’000	HK$’000	HK$’000
Turnover		7,886	7,415	18,026
Cost of Sales		(6,571)	(4,166)	(12,140)
Gross Profit		1,315	3,249	5,886
Other Income / Expenditure		167	62	79
Administrative expenses		(3,413)	(8,263)	(20,524)
Depreciation		(1,708)	(2,008)	(3,982)
Admission costs		(4,451)	(8,385)	(8,946)
Premium on reverse acquisition		-	(5,259)	(5,259)
Operating Loss		(8,090)	(20,604)	(32,746)
Finance Cost		(74)	(141)	(316)
Loss before taxation		(8,164)	(20,745)	(33,062)
Tax on loss on ordinary activities		-	-	-
Loss after taxation		(8,164)	(20,745)	(33,062)
Exchange difference arising on Translation		(955)	-	772
Loss and total comprehensive loss for the period		(9,119)	(20,745)	(32,290)
(Loss)/profit attributable to:
Equity holders of the Company		(8,348)	(20,699)	(33,069)
Non-controlling interests		184	(46)	7
		(8,164)	(20,745)	(33,062)
Total comprehensive (loss)/income attributable to:
Equity holders of the Company		(9,303)	(20,699)	(33,297)
Non-controlling interests		184	(46)	7
		(9,119)	(20,745)	(33,290)
Basic and diluted earnings per share (HK$)	5	(0.085)	(1.56)	(0.34)

Interim Condensed Statement of Changes in Equity

GVMH PLC	Share  Capital	Share Premium	Group Reorganization Reserve	Capital Contribution arising from shareholders loan	Exchange Reserve	Non-Controlling Interest	Retained Earnings	Total Equity
	HK$’000	HK$’000	HK$’000	HK$’000	HK$’000	HK$’000	HK$’000	HK$’000
Balance at 19 June 2018	99,782	45,835	-	-	-	-	(21,918)	123,699
Re-Organization Reserve	-	-	(96,631)	-	-	-	-	(96,631)
Capital Contribution	-	-	-	844	-	-	-	844
Exchange Reserve	-	-	-	-	(222)	-	-	(222)
Non-Controlling Interest	-	-	-	-	-	(3,464)	-	(3,464)
Loss for the period	-	-	-	-	-	-	(20,699)	(20,699)
Balance at 30 June 2018	99,782	45,835	(96,631)	844	(222)	(3,464)	(42,617)	3,527
Share issue	(3,765)	-	-	-	-	-	-	(3,765)
Share Premium	-	(1,729)	-	-	-	-	-	(1,729)
Capital Contribution	-	-	-	(844)	-	-	-	(844)
Exchange Reserve	-	-	-	-	2,118	-	-	2,118
Non-Controlling Interest	-	-	-	-	-	54	-	54
Loss for the Period	-	-	-	-	-	-	(11,598)	(11,598)
Balance at 31 December 2018	96,017	44,106	(96,631)	-	1,896	(3,410)	(54,215)	(12,237)
Re-Organization Reserve	-	-	4,461	-	-	-	-	4,461
Capital Contribution	-	-	-	844	-	-	-	844
Exchange Reserve	-	-	-	-	927	-	(296)	631
Non-Controlling Interest	-	-	-	-	-	184	-	184
Loss for the period	-	-	-	-	-	-	(9,303)	(9,303)
Balance at 30 June 2019	96,017	44,106	(92,170)	844	2,823	(3,226)	(63,814)	(15,420)

Share capital is the amount subscribed for shares at nominal value.

The share premium has arisen on the issue of shares at a premium to their nominal value.

Retained losses represent the cumulative loss of the Company attributable to equity shareholders.

Interim Condensed Statement of the Financial Position

	Notes	GVMH 30 June 2019	GVMH 30 June 2018	GVMH 31 December 2018
		HK$’000	HK$’000	HK$’000
Assets
Non-Current Assets
Property, plant and equipment		488	4,192	2,183
Investment in Subsidiary		-	-	-
Total Non-Current Asset		488	4,192	2,183
Current assets
Inventories		994	2,403	1,707
Trade and Other Receivables		6,890	6,083	5,104
Deposits and Pre-Payments		360	871	1,036
Cash and Cash Equivalents		2,752	8,692	2,552
Total Current Assets		10,996	18,049	10,399
Total Assets		11,484	22,241	12,582
Equity and Liabilities
Share Capital	6	96,017	99,782	96,017
Share Premium Account	6	44,106	45,835	44,106
Group Re-organization Reserve		(92,170)	(96,631)	(96,631)
Capital Contribution arising from Shareholder’s Loan		844	844	-
Exchange Reverses		2,823	(222)	1,896
Non-Controlling Interest		(3,226)	(3,464)	(3,410)
Retained Earnings		(63,814)	(42,617)	(54,215)
Total Equity		(15,420)	3,527	(12,237)
Liabilities
Non-Current Liabilities
Shareholders loan		13,779	8,502	8,676
Total Non-Current Liabilities		13,779	8,502	8,676
Current Liabilities
Trade and Other Payables		12,399	9,759	15,728
Amount Due to Directors		551	71	304
Deposits Received		175	382	111
Total Current Liability		13,126	10,212	16,143
Total Liabilities		26,904	18,714	24,819
Total Equity and Liabilities		11,484	22,241	12,582

Interim Condensed Cash Flow Statement

	Notes	GVMH 6 Months ended 30 June 2019		GVMH 6 Months ended 30 June 2018	GVMH For the year ended 31 December 2018
		HK$’000		HK$’000	HK$’000
Cash flows from operating activities
Operating loss		(8,164)		(20,745)	(33,062)
Add: Depreciation		1,708		2,008	3,982
Add: Finance Cost on Shareholders loan		74		141	316
Add: Non Cash Successful fee		-		6,972	7,024
Add: Share based payment					1,447
Add: Premium on reverse acquisition				5,259	5,259
Changes in working capital
(Increase) / decrease in inventories		712		403	1,119
(Increase) / decrease in receivables		(1,787)		120	1,270
Decrease in deposits and prepayments		677		-	7,857
Increase / (decrease) in payables		2,133		(5,432)	2,848
(Increase)/Decrease in amount due from related companies		-		-	257
Net cash flow from operating activities		(4,647)		(11,274)	(17,397)
Investing Activities
Payments for Purchase of Property, Plant and equity			(12)	(34)	(47)
Acquisition Net of Bank Balance				6,032	6,032
Net cash flow from investing activities			(12)	5,998	5,985
Cash flows from financing activities:
(Repayment of) / proceeds from Shareholder loans			5,029	2,500	2,500
Net proceeds from issue of shares		6	-	6,978	6,714
Net proceeds from share premium			-	3,489	3,357
Net cash flow from financing activities			5,029	12,967	12,571
Net cash flow for the period			370	7,691	1,159
Opening Cash and cash equivalents			2,552	1,136	1,136
Effect on Foreign exchange rate changes			(170)	(135)	257
Closing Cash and cash equivalents			2,752	8,692	2,552

Notes to the Interim Condensed Financial Statements

1.         General Information

GRAND VISION MEDIA HOLDINGS PLC (‘the Company’) is an investment company incorporated in the United Kingdom. Details of the registered office, the officers and advisers to the Company are presented on the Directors and Advisers page at the end of this report.  The information within these interim condensed financial statements and accompanying notes must be read in conjunction with the audited annual financial statements that have been prepared for the period ended 31 December 2018.   

2.         Basis of Preparation

These unaudited condensed consolidated interim financial statements for the six months ended 30 June 2019 were approved by the board and authorised for issue on 27 September 2019. 

The basis of preparation and accounting policies set out in the Annual Report and Accounts for the period ended 31 December 2018 have been applied in the preparation of these condensed interim financial statements.  These interim financial statements have been prepared in accordance with the recognition and measurement principles of the International Financial Reporting Standards (“IFRS”) as endorsed by the EU that are expected to be applicable to the financial statements for the year ending 31 December 2019 and on the basis of the accounting policies expected to be used in those financial statements. 

The figures for the six months ended 30 June 2019 and 30 June 2018 are unaudited and do not constitute full accounts. The comparative figures for the period ended 31 December 2018 are extracts from the 2018 audited accounts.  The independent auditor’s report on the 2018 accounts was not qualified.

The assets and liabilities of the legal subsidiary, GVC Holdings Limited are recognized and measured in the Group financial statements at the pre-combination carrying amounts, without restatement of fair value. The retained earnings and other equity balances recognized in the Group financial statements reflect the retained earnings and other equity balances of Grand Vision Media Holdings plc immediately before the reverse and the results of the period from 1 January 2018 to 30 June 2018 and post reverse.

Standards and Interpretations adopted with no material effect on financial statements

In the current year, the Group, for the first time, has applied IFRS 16 Leases. IFRS 16 introduces new or amended requirements with respect to lease accounting. It introduces significant changes to the lessee accounting by removing the distinction between operating and finance leases and requiring the recognition of a right-of-use asset and a lease liability at the lease commencement for all leases, except for short-term leases and leases of low value assets. In contrast to lessee accounting, the requirements for lessor accounting have remained largely unchanged. The impact of the adoption of IFRS 16 on the Group’s consolidated financial statements is described below. The Group has applied IFRS 16 using the Modified retrospective approach.

There are no other IFRS or IFRIC interpretations that are not yet effective that would be expected to have material impact on the Group.

3.         Segmental Reporting

In the opinion of the Directors, the Company has one class of business, being that of social media marketing and operates in the Peoples Republic of China.

4.         Company Result for the period

The Company has elected to take the exemption under section 408 of the Companies Act 2006 not to present the parent Company income statement account.

The operating loss of the Company for the six months ended 30 June 2019 was HK$ 1,052,293 (2018:
loss of HK$ 874,844, year ended 31 December 2018: HK$ 10,810,849). The current period operating loss incorporated the following main items:

	GVMH 30 June 2019	GVMH 30 June 2018	GVMH 31 December 2018
	(Unaudited)	(Unaudited)	(Audited)
	HK$’000	HK$‘000	HK$‘000
Accounting and administration fees	79	9	165
Employment expenses	732	8	816
Rent fees	-	3	47
Legal and professional fees	49	5	147
Listing costs	115	831	9,082
Other expenses	77	19	554
Total	1,052	875	10,811

5.         Earnings per Share

Earnings per share data is based on the Company result for the six months and the weighted average number of shares in issue.

Basic loss per share is calculated by dividing the loss attributable to equity shareholders by the weighted average number of ordinary shares in issue during the period:

	GVMH 30 June 2019 (Unaudited)	GVMH 30 June 2018 (Unaudited)	GVMH 31 December 2018 (Audited)
	HK$	HK$	HK$
Loss after tax	(8,348,000)	(20,699,000)	(33,069,000)
Weighted average number of ordinary shares in issue	96,287,079	13,234,439	96,287,079
Basic and diluted loss per share	(0.089)	(1.56)	(0.34)

Basic and diluted earnings per share are the same, since where a loss is incurred the effect of outstanding share options and warrants is considered anti-dilutive and is ignored for the purpose of the loss per share calculation. There were no potential dilutive shares in issue during the period.

6.         Share Capital

Ordinary shares are classified as equity. Proceeds from issuance of ordinary shares are classified as equity. Incremental costs directly attributable to the issuance of new ordinary shares are deducted against share capital.

Allotted, called up and fully paid ordinary  shares of 10p each	Number of shares	Share Capital	Share Capital	Share Premium	Share Premium
		£	HK$	£	HK$
Balance at 26 February 2016	50,000,000	50,000	518,150	-	-
Balance at 30 June 2016	50,000,000	50,000	518,150	-	-
Share issue – 2 August 2016	60,000,000	60,000	621,780	-	-
Consolidate shares – 3 August 2016	(108,900,000)	-	-	-	-
Balance at 31 December 2016	1,100,000	110,000	1,139,930	-	-
Share issue – 10 January 2017	5,130,000	513,000	5,316,219	257,000	2,663,291
Balance at 30 June 2018	6,230,000	623,000	6,456,149	257,000	2,663,291
After Acquisition Share 19 June 2018	90,057,079	9,005,708	93,326,151	4,502,854	46,663,075
Balance at 31 December 2018	96,287,079	9,628,708	99,782,300	4,759,854	49,326,366
Balance at 30 June 2019	96,287,079	9,628,708	99,782,300	4,759,854	49,326,366

7          Events Subsequent to 30 June 2019

On 19 July 2019, GVMH issued convertible loan notes of £670k.

8            Reverse Acquisition

The reverse acquisition occurred just prior to the period end 30 June 2018 and the consolidated numbers of GVC Holdings Limited are presented below for illustration purposes only:

Income statement

	GVCH 6 months Ended 30 June 2019		GVCH 6 months Ended 30 June 2018
	HK$’000		HK$’000
Turnover	7,886		7,415
Cost of Sales	(6,571)		(4,166)
Gross Profit	1,315		3,249
Other Income / Expenditure	168		62
Administrative expenses	(6,813)		(7,907)
EBITDA	(5,330)		(4,596)
Finance Cost	(73)		(141)
Depreciation	(1,708)		(2,008)
Loss before taxation	(7,111)		(6,745)
Tax on loss on ordinary activities	-		-
Loss after taxation	(7,111)		(6,745)
Exchange difference arising on Translation	(495)
Loss and total comprehensive loss for the period	(7,606)		(6,745)
(Loss)/profit attributable to:
Equity holders of the Company	(7,294)		(6,699)
Non-controlling interests	183		(47)
	(7,111)		(6,745)
Total comprehensive (loss)/income attributable to:
Equity holders of the Company	(7,789)		(6,699)
Non-controlling interests	183		(47)
	(7,606)		(6,745)
Basic and diluted earnings per share (HK$)	(588)		(540)

Balance Sheet	GVCH 30 June 2019		GVCH 30 June 2018
	HK$’000		HK$’000
Assets
Non-Current Assets
Property, plant and equipment	488		4,192
Investment in Subsidiary	-		-
Total Non-Current Asset	488		4,192
Current assets
Inventories	994		2,403
Trade and Other Receivables	6,890		3,845
Deposits and Pre-Payments	313		803
Cash and Cash Equivalents	2,681		2,660
Total Current Assets	10,878		9,711
Total Assets	11,366		13,903
Equity and Liabilities
Share Capital	106		106
Share Premium Account	30,368		30,368
Group Re-organization Reserve	(9,059)		(9,059)
Capital Contribution arising from Shareholder’s Loan	844		844
Exchange Reverses	597		(77)
Non-Controlling Interest	(3,226)		(3,464)
Retained Earnings	(45,590)		(28,617)
Total Equity	(25,960)		(9,899)
Liabilities
Non-Current Liabilities
Shareholders loan	12,750		8,501
Total Non-Current Liabilities	12,750		8,501
Current Liabilities
Trade and Other Payables	11,129		9,216
Amount due to GVMH	12,720		5,632
Amount Due to Directors	552		71
Deposits Received	175		382
Total Current Liability	24,576		15,301
Total Liabilities	37,326		23,802
Total Equity and Liabilities	11,366		13,903

9.         Reports          

This interim condensed financial statements will be available shortly on the Company website at www.gvmh.co.uk

For more information:

Grand Vision Media Holdings plc	http://gvmh.co.uk/
Edward Kwan-Mang Ng, Director	Tel: [phone] or [e-mail]
Alfred Henry Corporate Finance Ltd
Nick Michaels / Jon Isaacs	Tel: [phone] or [e-mail]

- ENDS -