12 Nov 2012 07:00
12 November 2012
New Trend Lifestyle Group plc - ("NTLG" or "The Company")
Further Expansion into Mainland China
New Trend Lifestyle Group plc (AIM: NTLG), the Singapore-based Feng Shui products and services group, is pleased to announce that New Trend Lifestyle (Shenzhen) Ltd ("NTLSZ"), its wholly-owned subsidiary based in China, has entered into a licensing agreement with Guangzhou Yuanzhongxiu Commodity Information Consulting Co., Ltd ("GYCIC"). The estimated annual income from licence payments alone is expected to be RMB1.2 million. In addition there will be the proceeds from sale of proprietary NTL products.
The principal terms of the licensing agreement are:
·; NTLSZ will lend RMB3.0 million to GYCIC ("the Loan") to provide working capital to establish NTL products and services in the five shops in Guangzhou, China that are operated by GYCIC.
·; Term of the Loan will be two years.
·; GYCIC will pay NTLSZ royalty fees of RMB100k per month for 16 months from commencement of the Loan.
·; The Loan will be secured on the assets of GYCIC.
·; At any time between 1st January 2014 and 30th June 2014, NTLSZ will have the option, at its sole discretion, to call upon 50% of the total issued and unissued share capital of GYCIC, in satisfaction of the Loan.
·; During the same period, and at its sole discretion, NTLSZ shall have the right to acquire the remaining 50% of the total issued and unissued share capital of GYCIC for a consideration in cash or in NTLG shares at their then-current mid-market price.
·; The total consideration will be four times the net profit of GYCIC in 2013 having added back licence fees for the year amounting to RMB 1.2 million.
Lawrence Cheung, finance director of NTLG commented:
"This agreement, which follows the opening in September of two shops in Shenzhen, gives us a firm foothold in south China and is another successful step in NTLG's strategy of continuously developing its place in the lucrative China market as a whole.
"Guangzhou is the biggest city in South China with a population of around 13 million. It is a leading commercial and manufacturing region - recently named one of the country's 'Megacities'. Its culture is similar to that of Hong Kong, another area with many followers of Feng Shui. However, related products and services are somewhat limited in the south of China and NTL is positioning itself to satisfy the so-far-unmet need for them."
-ends-
Indicative exchange rate at 1st November 2012:CNY (RMB or ¥) to GBP (£): 9.678
For further information:
NTLG Company
Investor Relations Department: IR@ntlglobal.com
NTL SZ. Tel: (86)755 2237 5082
Lawrence Cheung, Finance Director
Non-executive Chairman, Robert Goddard: Contact via Newgate Threadneedle,
Zeus Capital (NOMAD and broker)
Ross Andrews, Andrew Jones- Corporate Finance. Tel +44 (0)161 831 1512
John Goold - Institutional Sales. Tel: +44 (0)20 7016 8925
Newgate Threadneedle Tel: +44 (0)20 7653 9850
Graham Herring, Alex White, Heather Armstrong.
About New Trend Lifestyle
The Company was established in 2005 by Master Hillary Phang. NTL's Feng Shui services include building and office design consultancy, astrology readings, marriage matching, aura readings and business talks and seminars for large corporations. These have recently been complemented by Tarot Cards readings and an on-line dating service using Feng Shui principles.
NTL is one of the leading branded Feng Shui consultancies in Asia, selling its services to a mixture of high profile businessmen, political figures, business enterprises and the general public. It provides lifestyle guidance to customers, which leads to the provision of a number of products and services.
Feng Shui is endemic in Chinese communities throughout the world and influences many aspects of personal, business and even Government activities and is the basis on which the Company has created a profitable business with a strong brand and deep-seated cultural drivers.