OPP.L Regulatory News (OPP)

RNS Number : 3972T

Origo Partners PLC

28 September 2010

 

28 September

Origo Partners plc

 

("Origo" or the "Group")

Interim Financial Report for the six months ended 30 June, 2010

 

Highlights for the six months ended 30 June, 2010 ("the Period"):

 

- Revenues of US$1.4 million (30 June 2009: US$2.3 million)

- Operating loss of US$1.0 million (30 June 2009: US$1.5 million)

- Total administrative expenses of US$1.7 million (30 June 2009: US$2.7 million)

- Profit before tax of US$2.0 million (30 June 2009 loss before tax: US$3.5 million)

- Net asset value of US$162.5 million (31 December 2009: US$132.0 million)

- Net asset value per share of US$0.55 (31 December 2009: US$0.61)

- Follow-on investments of US$1.5 million in five existing portfolio companies

- Total investments of US$4.3 million in three new portfolio companies

- Ending cash position of US$47.4 million

 

Chief Executive's Statement

Following the creation of Origo Partners in December 2009 through the successful merger of Origo Sino India ("OSI") and Origo Resource Partners ("ORP"), the reshaped Company has already achieved a great deal in its first six months.

 

During the Period we raised US$30 million (before expenses) in new funds to enable us to capture a number of significant investment opportunities which we had already identified, made approximately US$11.6 million of investments to five new portfolio companies to date and launched our first Renminbi ("RMB") denominated fund in conjunction with a Chinese municipal government. At the time of our successful placing in June 2010 we announced that we had short-listed 6 investment opportunities and I am pleased to say that, to date, we have completed four of these investments.

 

We continue to broaden and deepen our investment portfolio in areas where we see strong long-term growth trends as well as in sectors where the Chinese government is actively seeking to support sustainable development. As a result, we continue to focus on the natural resource sector (including water), renewable energy, clean-technologies and investments in the agricultural and soft commodities sectors.

The supply of commodities such as coal, iron ore and copper is fundamentally constrained and as a result Origo's strategy is concentrated on the discovery and development of new resources which are well positioned to meet expected demand from China. In June, at the time of our successful Placing, we had identified four highly prospective opportunities in the Mongolian resource sector and to date we have already committed US$4.3 million dollars in new investments in mining exploration companies in Mongolia with prospects in coal, iron ore, copper and gold.

We also announced in September, after the Period end, the creation of a new joint venture with a Mongolian partner to provide corporate finance advisory services primarily to companies active in or seeking to enter the Mongolian natural resources sector. The joint venture, Resource Investment Capital Ltd ("ResCap"), will seek to foster long-term, senior-level relationships with clients and position itself as an independent advisor on strategic transactions such as mergers, acquisitions, restructurings, capital raising solutions and other financial matters. Following its formation in August 2010, ResCap completed its first transaction in September.

 

The Government of China is determined to reduce its dependency on international energy supplies and as such is supporting the development of new, more efficient and environmentally friendly energy technologies. As such, our investments in clean-technologies have been specifically targeted to benefit from this trend. In June, we identified investment opportunities in the Chinese clean-technologies and agriculture sectors amounting to approximately US$20 million. To date we have committed up to approximately US$7.3 million in two investments in a producer of lithium-ion batteries for vehicles and a business which recycles plastic and tyres into fuel oil and other products.

 

Our investments in the TMT sector continue to perform well on the back of increased spending from Chinese consumers. In particular, the internet security business Rising, in which we have a 2% stake and iFensi, a leading Chinese online entertainment information provider of which Origo owns approximately 14%, are both benefitting from the growth of a new Chinese middle class. However, we continue to see stronger growth potential in other sectors. As a previously announced, we intend to selectively realize the value in our TMT portfolio when appropriate in order to free up cash to invest in further clean-technology and natural resource opportunities.

We continue to actively seek funds for our planned RMB denominated China Sustainable Development Fund in conjunction with the Xinxiang Municipal Government. We have already set aside US$10 million to seed the fund with the Xinxiang Government also expected to provide initial funding of US$18 million. The new fund will enable us to begin a new phase in our asset management business.

 

Portfolio review

During the Period there have been a number of significant developments within the Group's 22 investee companies.

 

In December 2009, Halosource Inc. ("Halosource") successfully raised US$10 million from new investors to fund the further commercialisation of its patented water purification technology. The business continues to develop and recently announced a partnership to develop an emergency response point-of-use drinking water purification device with a company that supplies nongovernmental organisations such as Oxfam.

 

In March 2010 Possibility Space Inc. ("PSI") raised up to US$1.5m from a new investor to help fund the development of its online computer gaming business and in May 2010, Fans Media Ltd. ("Fans Media") announced the formation of SF Fans Ltd. ("SF Fans"), a new joint venture with SK Telecom, South Korea's largest telecom service provider. Buoyed by continued domestic Chinese consumption and the rapid expansion of the online gaming market we expect PSI and Fans Media to continue to develop their businesses.

 

In April 2010, Aqualyng Holding A/S, the desalination business in which Origo holds a stake, concluded a joint venture agreement with Beijing Enterprises Water Group Limited ("BEWGL"), one of China's leading water treatment groups with over 60 water plants across China. BEWGL is majority owned by Beijing Enterprises Holdings Limited, the Hong Kong listed commercial vehicle of the Municipal Government of Beijing. Aqualyng is currently building a large scale desalination plant outside of Beijing that is expected to come online in 2011, helping to address the critical water shortages in Northern China. We expect the launch of the desalination plant will be a tipping point in Aqualyng's business as it is also actively planning for more desalination operations in China in conjunction with BEWGL.

 

R.M. Williams Agricultural Holdings Pty Ltd ("RMWAH"), the Australian agricultural company focused on acquiring, developing and operating prime farmland, continues to benefit from demand for soft commodities and is performing ahead of expectations. In May, RMWAH raised US$45 million in further equity funding and a further US$5 million post the end of the Period. These fundraisings will enable RMWAH to expand significantly in order to take advantage of rapidly increasing global meat prices in developed and emerging economies and the rising demand from Asia for high-quality meat.

 

In June 2010, we strengthened our presence in Mongolia by completing investments in two Mongolian based mineral exploration companies. Bumbat Consolidated Ltd ("BCL") and Huremtiin Hyar LLC ("HH" or also known as "Universal Minerals") both have exploration licenses in areas where significant mineral occurrences have already been identified and are led by teams with experience in identifying and developing Mongolian mineral assets. Given its proximity to Chinese markets, Mongolia continues to be a territory of strong interest for us and we continue to build our presence there utilising the combined technical and commercial skills of the team of geologists and private equity professionals we, uniquely in our industry, have on the ground.

 

Also in June 2010, we invested US$3 million in Jinan Eco-Energy Technology Co. Ltd, since renamed NiuTech Energy, a Chinese provider and operator of recycling systems for waste plastic and scrap-tyres, to acquire an 11.8% equity stake. Under the terms of the transaction we maintain an option to invest an additional US$3.65 million for a fully- diluted equity interest of 20%. NiuTech Energy operates a plant in Taiwan and is co-developing two further plants in China and Germany using its proprietary technology. Origo's investment will help NiuTech Energy's experienced management team fund the continued growth of its business. By dealing both with a global environmental waste problem and producing fuel oil and other by-products which are commercially competitive, NiuTech is providing a technology and service that we believe is sustainable and highly profitable at current and projected oil prices.

 

In August 2010, after the Period, we announced the acquisition of a 16.5% stake in Unipower Battery Ltd ("Unipower") for an aggregate amount of US$4.3 million. Unipower is a new venture established to provide lithium-ion batteries and related materials to China's burgeoning electric vehicle market. The Company is in the process of being spun out from the Huanyu Group, one of the largest privately held rechargeable battery manufacturers in China. As a spin out from an established market player, Unipower benefits from a combination of years of R&D, a large number of patents, highly trained employees and management and a strong portfolio of customers that is already enabling it to make in-roads in the Chinese electric vehicle market.

 

Also in September, after the Period, we announced the acquisition of a 25% stake in Kincora Ltd, owner of the Bronze Fox copper-gold prospect ("Bronze Fox") in Mongolia for US$3 million. While Bronze Fox is still very much an early stage exploration asset, it benefits from being situated close to the Chinese border in a known copper belt, and has access to both power and transport infrastructure. We have also acquired an option to take a majority 75% equity stake in Kincora, subject to a drilling program administered by Origo's own team of geologists.

 

In September, we announced the disposal of our stake in E-Bill China Holding Ltd ("E-Bill"), a Chinese electronic payment services provider. The stake, acquired for US$2 million, will be sold back to E-Bill's founding shareholder for US$2.8 million in cash - a 1.4x cash to cash return on the cost of the investment.

 

Financial performance

Origo recorded a profit before tax of US$2.0 million for the Period, an increase of 158% compared to a loss of US$3.5 million in the first half of 2009. This significant increase in profitability was due to an increase in investment income. Post the merger of OSI and ORP, the Company's other administration expenses remained broadly in line, rising from US$2.1 million in same period in 2009 to US$2.2 million for the Period, while the total administration expenses falling 36% to US$1.7 million primarily due to the reversal of US$1.2 million of share based payments.

 

The Directors' estimate of the fair value of Origo's portfolio of investments at 30 June 2010 was US$113.4 million, compared to US$105.7 million at the end of 31 December 2009 following the completion of the merger of ORP and OSI. The increase is due primarily to new investments made totalling US$5.8 million and an increase in the value of Origo's investment in RMWAH by US$3 million.

 

At the end of the Period, the Group had net cash and cash equivalents of US$47.4 million, compared to US$25 million in the same Period of 2009. The increase is primarily as a result of the US$30 million placing, before expenses, in June 2010.

 

The Group recorded a net asset value per share at the end of the Period of US$0.55 compared to US$0.61 at 31 December 2009. The decline in the net asset value per share is a result of the placing of 82,200,000 new shares in June 2010 to raise $30 million before expenses, which was undertaken at a small discount to the prevailing market price on that day.

 

Revenues declined by 39% from US$2.3 million to US$1.4 million, primarily as a result of the anticipated loss of fund management fees following the merger of ORP and OSI.

 

Strategy and outlook

The Chinese economy continues to perform very well with GDP growing in excess of 10% in the second quarter of 2010. Whilst we expect this growth rate to moderate in the second half of the year as a result of Government initiatives to moderate growth, we are still expecting GDP growth of around 8.5% for the remainder of the year. As a result we maintain our positive outlook for both the Chinese economy and the Company's prospects.

 

We see most growth potential in the natural resource and clean-technology sectors and we will continue to target investments in these two areas through our growing presence in Mongolia and our plans for a new RMB fund focussed on the clean-technology sector.

 

Our growing portfolio of investments in Mongolia as well as the launch of ResCap will provide us with a solid platform to develop a leading position in what we expect to be one of the most significant destinations for international investment in natural resources over the next few years. There remain significant challenges to operating in Mongolia, however, with a strong team on the ground I believe we are well placed to capture opportunities as they arise.

 

Following the signing of a Memorandum of Understanding with the Xinxiang Municipal Government earlier in the year, we are now finalising the details of the RMB fund and expect to begin raising external capital in the next few months.

 

To further these aims we plan to realise funds from selected portfolio companies, particularly in the TMT sector, in order to fund new investments.

 

 

 

Further information:

 

Origo Partners plc Chris Rynning (chris@origoplc.com) Niklas Ponnert (niklas@origoplc.com)	+86 1390 124 6417   +86 1351 106 1672
Nominated Adviser and Broker Liberum Capital Limited Simon Atkinson / Ellen Francis	+44 (0)20 3100 2222
Public Relations Aura Financial Andy Mills / Nina Legge	+44 (0)20 7321 0000

 

 

 

 

 

 

 

 

Origo PartnersPlc 

Condensed Consolidated Statement of Comprehensive Income

For the six months ended 30 June 2010

		(Unaudited) six months ended 30 June 2010		(Unaudited) six months ended 30 June 2009
	Notes	US$'000			US$'000
Revenue	3	1,417			2,334
Cost of sales	3	(740)			(1,163)
Gross profit		677			1,171
Distribution costs		(3)			(24)
Share-based payments	4	461			(631)
Other administrative expenses	4	(2,173)			(2,049)
Total administrative expenses	4	(1,712)			(2,680)
Loss from operations		(1,038)			(1,533)
Investment income/(loss)	7	2,296			(712)
Including:
- Share of losses of associates		(68)			(29)
Foreign exchange losses		(283)			(1,529)
Finance income		1,060			335
Finance costs		(41)			(25)
Other income		-			1
Profit /(loss) before tax		1,994			(3,463)
Income tax		-			-
Profit /(loss) after tax		1,994			(3,463)
Other comprehensive income
Exchange differences on translating foreign operations		5			(83)
Exchange differences on change in presentation currency		-			8,640
Available-for-sale financial assets		-			(208)
Other comprehensive income for the period, net of tax		5			8,349
Total comprehensive income for the period		1,999			4,886
Profit /(loss) after tax
Attributable to:
- Owners of the parent		2,020			(3,416)
- Non-controlling interests		(26)			(47)
		1,994			(3,463)
Total comprehensive income
Attributable to:
- Owners of the parent		2,025			4,933
- Non-controlling interests		(26)			(47)
		1,999			4,886
Basic and diluted earnings/(loss) per share	8	0.90cents			(3.55)cents

 

The accompanying notes form an integral part of these financial statements.

Condensed Consolidated Statement of Financial Position

As at 30 June 2010

 

Assets	Notes	(Unaudited) 30 June 2010 US$'000	(Unaudited) 30 June 2009 US$'000	(Audited) 31 December 2009 US$'000
Non-current assets
Property, plant and equipment (PPE)		63	79	71
Intangible assets		15	17	16
Investments at fair value through profit or loss	9	94,310	31,883	86,929
Loans	11	18,989	4,412	18,644
Available for sale investments	13	49	49	49
Investments in associates	10	21	58	67
Other investments		15	8	8
		113,462	36,506	105,784
Current assets
Inventories		52	53	51
Trade and other receivables	12	4,711	3,417	3,680
Cash and bank balances		47,437	21,804	24,994
		52,200	25,274	28,725
Total assets		165,662	61,780	134,509
Current liabilities
Trade and other payables	14	3,206	696	2,522
Total liabilities		3,206	696	2,522
Total net assets		162,456	61,084	131,987
Equity attributable to equity holders of the parent
Issued capital	15	47	14	35
Share premium		119,261	45,539	89,785
Share-based payment reserve		5,409	5,362	6,427
Retained earnings		40,941	(3,478)	38,921
Warrant reserve		-	6,849	-
Translation reserve		(1,495)	7,281	(1,500)
Other reserve		(1,432)	(262)	(1,432)
		162,731	61,305	132,236
Non-controlling interests		(275)	(221)	(249)
Total equity		162,456	61,084	131,987
Total equity and liabilities		165,662	61,780	134,509

 

The accompanying notes form an integral part of these financial statements.

 

Condensed Consolidated Statement of Cash Flows

For the six months ended 30 June 2010

 

	(Unaudited)	(Unaudited)
	Six months ended	Six months ended
	30 June 2010	30 June 2009
	US$'000	US$'000
Profit/(loss) after tax	1,994	(3,463)
Adjustments for:
Depreciation	12	11
Share-based payments	(461)	631
Unrealised (gains)/losses on fair value change of FVTPL	(2,364)	922
Realised gain on disposal of an investment	-	(239)
Share of losses of associates	68	29
Foreign exchange losses	283	789
Finance income	(1,060)	(183)
Operating loss before changes in working capital and provisions	(1,528)	(1,503)
Increase in trade and other receivables	(1,032)	(412)
Increase/(decrease) in trade and other payables	684	(17)
(Increase)/decrease in inventories	(1)	5
Net cash outflow from operations	(1,877)	(1,927)
Investing activities
Purchases of property, plant and equipment	3	(30)
Decrease in intangible assets	1	-
Investments of financial instruments	(5,411)	(2,855)
Proceeds from disposals of investments	-	4,874
Finance income received	-	195
Net cash flows used in investing activities	(5,407)	2,184
Financing activities
Issue of ordinary shares	29,488	-
Net cash flows used in financing activities	29,488	-
Increase in cash and cash equivalents	22,204	257
Net foreign exchange differences	239	2,563
Cash and cash equivalents at beginning of period	24,994	18,984
Cash and cash equivalents at end of period	47,437	21,804

 

 

The accompanying notes form an integral part of these financial statements.

 

Condensed Consolidated Statement of Changes in Equity

For the six months ended 30 June 2010

 

Attributable to equity holders of the parent

	Issued capital US$'000	Share premium US$'000	Share- based payment reserve US$'000	Retained earnings US$'000	Warrant reserve US$'000	Other reserve US$'000	Translation reserve US$'000	Total US$'000	Non- controlling interests US$'000	Total equity US$'000
At 1 January 2010	35	89,785	6,427	38,921	-	(1,432)	(1,500)	132,236	(249)	131,987
Profit for the period	-	-	-	2,020	-	-	-	2,020	(26)	1,994
Other comprehensive income	-	-	-	-	-	-	5	5	-	5
Total comprehensive income	-	-	-	2,020	-	-	5	2,025	(26)	1,999
Proceeds from share issues for cash	12	29,476	-	-	-	-	-	29,488	-	29,488
Share-based payment expense	-	-	(1,018)	-	-	-	-	(1,018)	-	(1,018)
At 30 June 2010	47	119,261	5,409	40,941	-	(1,432)	(1,495)	162,731	(275)	162,456

 

For the six months ended 30 June 2009

 

Attributable to equity holders of the parent

	Issued capital US$'000	Share premium US$'000	Share- based payment reserve US$'000	Retained earnings US$'000	Warrant reserve US$'000	Other reserve US$'000	Translation reserve US$'000	Total US$'000	Non- controlling interests US$'000	Total equity US$'000
At 1 January 2009	14	45,539	4,731	(62)	6,849	(54)	(1,276)	55,741	(174)	55,567
Loss for the period	-	-	-	(3,416)	-	-	-	(3,416)	(47)	(3,463)
Other comprehensive income	-	-	-	-	-	(208)	8,557	8,349	-	8,349
Total comprehensive income	-	-	-	(3,416)	-	(208)	8,557	4,933	(47)	4,886
Share-based payment expense	-	-	631	-	-	-	-	631	-	631
At 30 June 2009	14	45,539	5,362	(3,478)	6,849	(262)	7,281	61,305	(221)	61,084

 

 

 

 

The accompanying notes form an integral part of these financial statements.

 

 

Notes to the Interim Condensed Consolidated Financial Statements

For the six months ended 30 June 2010

 

1 General information

 

Origo Partners Plc is a limited liability company incorporated and domiciled in the Isle of Man whose shares are publicly traded on the AIM market of the London Stock Exchange.

 

The Company and its subsidiaries are collectively referred to as the Group.

 

The principal activities of the Group are described in note 6.

 

These interim condensed consolidated financial statements have been approved and authorised for issue by the Company's board of directors on 27 September 2010.

 

2 Basis of preparation and significant accounting policies

 

2.1 Basis of preparation

 

These interim condensed consolidated financial statements have been prepared in accordance with International Accounting Standard 34 "Interim Financial Reporting".

 

These interim condensed consolidated financial statements do not include all the information and disclosures required in the annual financial statements, and should be read in conjunction with the Group's annual financial statements for the year ended 31 December 2009.

 

2.2 Significant accounting policies

 

The accounting policies adopted in the preparation of the interim condensed consolidated financial statements are consistent with those followed in the preparation of the Group's annual financial statements for the year ended 31 December 2009, except for the adoption of new standards and interpretations as of 1 January 2010, noted below:

 

Amendment to IFRS 2 Share-based Payment - Group Cash-settled Share-based Payment Transactions

 

The standard has been amended to clarify the accounting for group cash-settled share-based payment transactions. This amendment also supersedes IFRIC 8 and IFRIC 11. The adoption of this amendment did not have any impact on the financial position or performance of the Group.

 

IFRS 3 Business Combinations (Revised) and IAS 27 Consolidated and Separate Financial Statements (Amended)

 

The Group applies the revised standards from 1 January 2010. IFRS 3 (Revised) introduces significant changes in the accounting for business combinations occurring after this date. Changes affect the valuation of non-controlling interest, the accounting for transaction costs, the initial recognition and subsequent measurement of a contingent consideration and business combinations achieved in stages. These changes also impact the amount of goodwill recognised, the reported results in the period that an acquisition occurs and future reported results.

IAS 27 (Amended) requires that a change in the ownership interest of a subsidiary (without loss of control) is accounted for as a transaction with owners in their capacity as owners. Therefore, such transactions will no longer give rise to goodwill, nor will they give rise to gains or losses. Furthermore, the amended standard changes the accounting for losses incurred by the subsidiary as well as the loss of control of a subsidiary. The changes by IFRS 3 (Revised) and IAS 27 (Amended) affect future acquisitions or loss of control of subsidiaries and transactions with non-controlling interests.

The change in accounting policy was applied prospectively and had no material impact on the financial position or performance of the Group.

 

 

Notes to the Interim Condensed Consolidated Financial Statements (Continued)

For the six months ended 30 June 2010

 

2 Basis of preparation and significant accounting policies (Continued)

 

2.2 Significant accounting policies (Continued)

 

Amendment to IAS 39 Financial Instruments: Recognition and Measurement - Eligible Hedged Items

The amendment addresses the designation of a one-sided risk in a hedged item, and the designation of inflation as a hedged risk or portion in particular situations. The amendment had no effect on the financial position nor performance of the Group.

 

IFRIC 17 Distribution of Non-cash Assets to Owners

This interpretation provides guidance on accounting for arrangements whereby an entity distributes noncash assets to shareholders either as a distribution of reserves or as dividends. The interpretation had no effect on the financial position nor performance of the Group.

 

The Group has not early adopted any other standard, interpretation or amendment that was issued but is not yet effective.

 

2.3 Changes in significant accounting estimates

 

In the current period, the Company used Black-Scholes option pricing model to calculate the fair value of upper share rights ("USR") in which the volatility assumption was estimated based on source data from Bloomberg. To be consistent with the volatility assumption being used, the Company adopted the same source data to estimate the volatility assumption used in calculating the fair value of the equity-settled share option scheme as at 30 June 2010, which had used volatility assumptions estimated based on source data from Yahoo Finance prior to 2010. This change in accounting estimate results in an increase in net profit for the period and a corresponding decrease in the share-based payment reserve of US$ 1,231,000 but has no impact to the net assets of the Group.  Please refer to note 16 for further details.

 

Notes to the Interim Condensed Consolidated Financial Statements (Continued)

For the six months ended 30 June 2010

 

3 Revenue and cost of sales

 

	(Unaudited) Six months ended 30 June 2010 US$'000	(Unaudited) Six months ended 30 June 2009 US$'000
Revenue
Consulting services	1,077	1,671
Fund consulting	-	468
Furniture trading	340	195
Total	1,417	2,334
Cost of sales
Consulting services	367	1,005
Furniture trading	336	130
Business tax	37	28
Total	740	1,163

 

4 Administrative expenses

 

	(Unaudited) Six months ended 30 June 2010 US$'000		(Unaudited) Six months ended 30 June 2009 US$'000
Employee expenses	959		1,015
Professional fees	622		435
Including:
- Audit fees	2		44
Share-based payments	(461)		631
Depreciation expenses	12		11
Acquisition cost	15		-
Others	565		588
Total	1,712		2,680

 

 

 

Notes to the Interim Condensed Consolidated Financial Statements (Continued)

For the six months ended 30 June 2010

 

5 Directors' remuneration

 

				(Unaudited) Six months ended 30 June 2009 30US US$'000	(Unaudited) Six months  ended 30 June 2009 US$'000
Directors' emoluments				403	421
Share-based payments				(353)	374
				50	795

 

Directors' remuneration for the six months ended 30 June 2010 and number of options held were as follows:

 

Name	Salaries* US$'000			Director Fee*US$'000	Share-based payments**US$'000	TotalUS$'000	Number of options
Mr. Wang Chao Yong	75			-	(112)	(37)	4,000,000
Mr. Chris A Rynning	137			-	75	212	1,000,000
Mr. Niklas Ponnert	113			-	(304)	(191)	2,800,000
Mr. Christopher Jemmett		-	39		(6)	33		100,000
Mr. Dipankar Basu	-			39	(6)	33	100,000
	325			78	(353)	50	8,000,000

 

Directors' remuneration for the six months ended 30 June 2009 and number of options held were as follows:

Name	Salaries*US$'000	Director Fee*US$'000	Share-based payments**US$'000	TotalUS$'000	Number of options
Mr. Wang Chao Yong	80	-	140	220	4,000,000
Mr. Chris A Rynning	145	-	35	180	1,000,000
Mr. Niklas Ponnert	118	-	191	309	2,800,000
Mr. Christopher Jemmett	-	39	4	43	100,000
Mr. Dipankar Basu	-	39	4	43	100,000
	343	78	374	795	8,000,000

 

 

* Short term employee benefits

** Share-based payments refer to expenses arising from the Company's share option scheme (note 16).

 

 

 

 

 

Notes to the Interim Condensed Consolidated Financial Statements (Continued)

For the six months ended 30 June 2010

 

6 Operating segment information

 

The Group's primary reporting format for reporting segment information is by operating segment based on the nature of its business which was private equity investments, fund consulting, consulting services, and furniture trading for the six months ended 30 June 2010 and 2009.

 

The Group mainly had five geographical segments based on the location of assets. The segments are defined as Isle of Man, Guernsey, Malaysia, China and others.

 

For the six months ended 30 June 2010 (Unaudited)

 

	Private equity investments	Fund consulting	Consulting services	Furniture trading	Total
	US$'000	US$'000	US$'000	US$'000	US$'000
Revenue
External	-	-	1,077	340	1,417
Finance income	1,060	-	-	-	1,060
Total revenue	1,060	-	1,077	340	2,477
Expenses
Cost of sales	(126)	-	(278)	(336)	(740)
Operation expenses	(1,215)	-	(868)	(93)	(2,176)
Share-based payments	276	-	185	-	461
Finance costs	(40)	-	-	(1)	(41)
Other
Investment income/(loss)	2,364	-	(68)	-	2,296
Other income	-	-	-	-	-
Foreign exchange losses	(283)	-	-	-	(283)
Total profit / (loss) after tax	2,036	-	48	(90)	1,994
Statement of financial position
Assets	165,166	3	186	307	165,662
(Liabilities)	(2,836)	-	(348)	(22)	(3,206)
Net assets	162,330	3	(162)	285	162,456

 

For the six months ended 30 June 2010 (Unaudited)

 

	Isle of ManUS$'000	GuernseyUS$'000	MalaysiaUS$'000	ChinaUS$'000	OthersUS$'000	TotalUS$'000
External revenue	996	-	-	81	340	1,417
Non-current assets	-	-	36	63	15	114

 

Notes to the Interim Condensed Consolidated Financial Statements (Continued)

For the six months ended 30 June 2010

 

6 Operating segment information (Continued)

For the six months ended 30 June 2009 (Unaudited)

 

	Private equity investments		Fund consulting		Consulting services		Furniture trading		Total
	US$'000		US$'000		US$'000		US$'000		US$'000
Revenue
External		-		-		2,139		195		2,334
Finance income		335		-		-		-		335
Total revenue		335		-		2,139		195		2,669
Expenses
Cost of sales		(309)		-		(723)		(131)		(1,163)
Operation expenses		(1,096)		-		(756)		(221)		(2,073)
Share-based payments		(379)		-		(252)		-		(631)
Finance costs		(19)		-		(2)		(4)		(25)
Other
Investment loss		(683)		-		(29)		-		(712)
Other income		1		-		-		-		1
Foreign exchange losses		(1,486)		-		(41)		(2)		(1,529)
Total (loss)/profit before and after tax		(3,636)		-		336		(163)		(3,463)
Statement of financial position
Assets		61,016		1		604		159		61,780
(Liabilities)		(290)		-		(385)		(21)		(696)
Net assets		60,726		1		219		138		61,084

 

For the six months ended 30 June 2009 (Unaudited)

 

	Isle of Man US$'000	Guernsey US$'000	Malaysia US$'000	China US$'000	Others US$'000	Total US$'000
External Revenue	2,116	-	-	31	187	2,334
Non-current assets	-	-	66	79	17	162

 

7 Investment income/ (loss)

		(Unaudited) six months ended 30 June 2010 US$'000	(Unaudited) Six months ended 30 June 2009 US$'000
Unrealised gains/(losses) on fair value change of FVTPL using estimation techniques*		2,364	(922)
Realised gain on disposal of an investment**		-	239
Share of losses of associates		(68)	(29)
Total		2,296	(712)

 

* FVTPL refers to fair value through profit or loss

** The amount represents realised gain from the disposal of Fomento International Ltd amounted to US$239,000.

 

Notes to the Interim Condensed Consolidated Financial Statements (Continued)

For the six months ended 30 June 2010

8 Earnings/ (loss) per share

Numerator		(Unaudited) Six months ended 30 June 2010 US$'000	(Unaudited) Six months ended 30 June 2009 US$'000
Profit/ (loss) for the period		1,994	(3,463)
Earnings/ (loss) used in basic and diluted earnings or loss per share		1,994	(3,463)
Denominator	(Unaudited) 30 June 2010 Number of shares		(Unaudited) 30 June 2009 Number of shares
Weighted average number of shares used in basic EPS/(LPS)	221,654,998		97,547,877
Weighted average number of shares used in diluted EPS/(LPS)	222,601,098		97,547,877
Basic and diluted EPS/(LPS)	0.90cents		(3.55)cents

 

 

9 Investments at fair value through profit or loss

 

As at 30 June 2010 (Unaudited)

Name*	Country of incorporation	Fair Value hierarchy level	Proportion of ownership interest	Cost US$'000	Fair value US$'000
IRCA Holdings Ltd	British Virgin Islands	3	49.1%	9,505	9,505
Possibility Space Incorporated**	British Virgin Islands	3	46.9%	1,834	1,433
Roshini International Bio-Energy Corporation	British Virgin Islands	3	35.9%	17,050	-
China Commodities Absolute Return Ltd	Isle of Man	3	27.3%	400	394
R.M.Williams Agricultural Holdings Pty Ltd	Australia	3	20.1%	20,000	24,662
Gobi Coal & Energy Ltd	British Virgin Islands	3	19.6%	14,708	26,337
HaloSource Inc	USA	3	16.5%	10,000	10,000
Fans Media Co., Ltd	British Virgin Islands	3	14.3%	2,360	2,360
Achieve Stars Development Ltd	British Virgin Islands	3	11.8%	3,000	3,000
Bumbat Consolidated Ltd	British Virgin Islands	3	11.3%	1,000	1,000
Huremtiin Hyar LLC	Mongolia	3	10.0%	300	300
Staur Aqua AS	Norway	3	9.2%	719	667
E-Bill (China) Holding Ltd	Cayman Islands	3	7.1%	2,000	2,000
Bach Technology AS	Norway	3	3.3%	60	171
Rising Technology Corporation Ltd	British Virgin Islands	3	2.0%	7,000	12,456
Kooky Panda Ltd	Cayman Islands	3	1.2%	25	25
Total				89,961	94,310

 

* There are no significant restrictions that will have an impact on transfer of these investments.

** Share swap between Possibility Space Incorporated (USA) and Possibility Space Incorporated (BVI) in February 2010.

 

 

 

Notes to the Interim Condensed Consolidated Financial Statements (Continued)

For the six months ended 30 June 2010

 

9 Investments at fair value through profit or loss (Continued)

 

In accordance with IFRS 7: Financial Instruments: Disclosures, financial instruments recognised at fair value are required to be analysed between those whose fair value is based on:

 

a) Quoted prices in active markets for identical assets or liabilities (Level 1);

b) Those involving inputs other than quoted prices included in level 1 that are observable for the asset or liability, either directly (as prices) or indirectly (derived from prices) (Level 2); and

c) Those with inputs for the asset or liability that are not based on observable market data (unobservable inputs) (Level 3).

 

During the period, there were no transfers between Levels.

 

Statement of changes in investments at fair value through profit or loss based on level 3:

 

	(Unaudited) Six month ended 30 June 2010 US$'000
Opening balance	86,929
Purchases	4,359
Movement in unrealised gains on investments	3,022
- In profit or loss	3,022
Closing balance	94,310

 

 

 

Notes to the Interim Condensed Consolidated Financial Statements (Continued)

For the six months ended 30 June 2010

 

9 Investments at fair value through profit or loss (Continued)

 

 

As at 30 June 2009 (Unaudited)

Name	Country of incorporation	Fair value hierarchy level	Proportion of ownership interest	Cost	Fair value
				US$'000	US$'000
IRCA Holdings Ltd	British Virgin Islands	3	17.3%	1,000	1,000
Roshini International Bio-Energy Corporation	British Virgin Islands	3	15.9%	-	3,580
Possibility Space Incorporated	USA	3	15.8%	1,775	1,774
Fans Media Co., Ltd	British Virgin Islands	3	14.3%	2,360	2,362
R.M. Williams Agricultural Holdings Pty Ltd	Australia	3	7.5%	4,000	5,565
E-Bill (China) Holding Ltd	Cayman Islands	3	7.1%	2,000	2,000
HaloSource Inc	USA	3	4.8%	3,000	2,999
Bach Technology AS	Norway	3	4.4%	60	172
Rising Technology Corporation Ltd	British Virgin Islands	3	2.0%	7,000	12,431
Total				21,195	31,883

 

As at 31 December 2009 (Audited)

Name	Country of incorporation	Fair Value hierarchy level	Proportion of ownership interest	Cost US$'000	Fair value US$'000
IRCA Holdings Ltd	British Virgin Islands	3	49.1%	9,505	9,505
Possibility Space Incorporated	USA	3	45.0%	1,775	1,428
Roshini International Bio-Energy Corporation	British Virgin Islands	3	35.9%	17,050	-
China Commodities Absolute Return Ltd	Isle of Man	3	27.3%	400	381
R.M.Williams Agricultural Holdings Pty Ltd	Australia	3	21.1%	20,000	21,500
Gobi Coal & Energy Ltd	British Virgin Islands	3	20.8%	14,708	26,337
HaloSource Inc	USA	3	16.6%	10,000	10,000
Fans Media Co., Ltd	British Virgin Islands	3	14.3%	2,360	2,360
Staur Aqua AS	Norway	3	9.2%	719	746
E-Bill (China) Holding Ltd	Cayman Islands	3	7.1%	2,000	2,000
Bach Technology AS	Norway	3	4.4%	60	191
Rising Technology Corporation Ltd	British Virgin Islands	3	2.0%	7,000	12,456
Kooky Panda Ltd	Cayman Islands	3	1.2%	25	25
Total				85,602	86,929

 

 

 

 

Notes to the Interim Condensed Consolidated Financial Statements (Continued)

For the six months ended 30 June 2010

 

10 Investments in associates

 

The following entities meet the definition of an associate and have been accounted for in the consolidated financial statements on an equity basis:

 

As at 30 June 2010 (Unaudited)

 

Name	Country of incorporation	Proportion of voting rights held
Dragon Ports Ltd ("DP")	British Virgin Islands	44.7% (Owned by Ascend Ventures Ltd)

 

Aggregated amounts relating to the associate for the six months ended 30 June 2010 are as follows:

	US$'000
Total assets	1,178
Total liabilities	645
Revenue	218
Loss	(153)

 

As at 30 June 2009 (Unaudited)

 

Name	Country of incorporation	Proportion of voting rights held
Dragon Ports Ltd ("DP")	British Virgin Islands	45% (Owned by Ascend Ventures Ltd)
OS Consulting Ltd ("OS")	Malaysia	19.9% (Owned by Ascend Ventures Ltd)

 

Aggregated amounts relating to associates for the six months ended 30 June 2009 are as follows:

	DP	OS
	US$'000	US$'000
Total assets	1,334	534
Total liabilities	723	125
Revenue	615	-
Loss	(65)	-

 

 

 

Notes to the Interim Condensed Consolidated Financial Statements (Continued)

For the six months ended 30 June 2010

 

10 Investments in associates (Continued)

As at 31 December 2009 (Audited)

 

Name	Country of incorporation	Proportion of voting rights held
Dragon Ports Ltd ("DP")*	British Virgin Islands	42.5% (Owned by Ascend Ventures Ltd)

 

* The investment in OS Consulting Ltd ("OS") had been reclassified from investments in associates to other investments at the end of 2009.

 

Aggregated amounts relating to the associate for the year ended 31 December 2009 are as follows:

	US$'000
Total assets	1,220
Total liabilities	592
Revenue	1,045
Loss	(369)

 

11 Loans

The Group has entered into convertible credit agreements and has the right to convert the outstanding principal balance of relevant loans into borrower's shares according to certain conversion conditions, and loan agreements with certain investee companies as set forth in the table below.

As at 30 June 2010 (Unaudited)
Borrower			Loan principal	Fair value
			US$'000	US$'000
Convertible credit agreements*
Roshini International Bio-Energy Corporation			60	60
Dragon Ports Ltd			173	173
R.M.Williams Agricultural Holdings Pty Ltd			3,090	2,857
Staur Aqua AS			3,228	3,180
IRCA Holdings Ltd			10,145	10,145
Sub-total			16,696	16,415
			Loan principal	Amortised cost
Borrower			US$'000	US$'000
Loan agreements*
China Silvertone Investment Co Ltd			478	478
IRCA Holdings Ltd			2,158	2,096
Sub-total			2,636	2,574
Total			19,332	18,989

 

* Loans in relation to convertible credit agreements are measured at fair value. Loans in relation to loan agreements are measured at amortised cost using the effective interest rate method less any identified impairment losses.

Notes to the Interim Condensed Consolidated Financial Statements (Continued)

For the six months ended 30 June 2010

 

11 Loans (Continued)

As at 30 June 2009 (Unaudited)
			Loan principal	Fair value
Borrower			US$'000	US$'000
Convertible credit agreements
Dragon Ports Ltd			266	2,66
Possibility Space Incorporated			1,500	1,500
Sub-total			1,766	1,766
Borrower			Loan principal US$'000	Amortised cost US$'000
Loan agreements
China Silvertone Investment Co Ltd			478	478
IRCA Holdings Ltd			2,075	2,168
Sub-total			2,553	2,646
Total			4,319	4,412
As at 31 December 2009 (Audited)
Borrower			Loan principal	Fair value
			US$'000	US$'000
Convertible credit agreements
Dragon Ports Ltd			173	173
Possibility Space Incorporated			270	270
R.M.Williams Agricultural Holdings Pty Ltd			3,090	3,066
Staur Aqua AS			3,008	3,335
IRCA Holdings Ltd			9,045	9,045
Sub-total			15,586	15,889
			Loan principal	Amortised cost
Borrower			US$'000	US$'000
Loan agreements
Possibility Space Incorporated			125	125
China Silvertone Investment Co Ltd			478	478
IRCA Holdings Ltd			2,144	2,152
Sub-total			2,747	2,755
Total			18,333	18,644

 

Statement of changes in loans:

	(Unaudited) Six months ended 30 June 2010 US$'000
Opening balance	18,644
Addition	1,389
Repayment	(650)
Net exchange differences	(394)
Closing balance	18,989

Notes to the Interim Condensed Consolidated Financial Statements (Continued)

For the six months ended 30 June 2010

 

12 Trade and other receivables

	(Unaudited) 30 June 2010 US$'000	(Unaudited) 30 June 2009 US$'000	(Audited) 31 December 2009 US$'000
Trade debtors	459	548	427
Other debtors	3,991	2,622	3,101
Prepayments	261	247	152
Total	4,711	3,417	3,680

 

 

 

 

 

 

 

 

 

 

 

13 Available for sale investments

 

	Level	(Unaudited) 30 June 2010 US$'000	(Unaudited) 30 June 2009 US$'000	(Audited) 31 December 2009 US$'000
WeKa Entertainment SA*	3	49	49	49
Total		49	49	49

 

* Available for sale investments comprise a 0.25% shareholding in WeKa Entertainment SA (formerly Cafe.com SA) held by the subsidiary, Ascend Ventures Ltd, whose fair value is assessed at price of recent investment.

 

Statement of changes in available for sale investments based on level 3:

 

	(Unaudited) Six months ended 30 June 2010 US$'000   US$'000
Opening balance	49
Movement in unrealised gains on investments	-
- In other comprehensive income	-
Closing balance	49

 

14 Trade and other payables - current

 

	(Unaudited) 30 June 2010 US$'000	(Unaudited) 30 June 2009 US$'000	(Audited) 31 December 2009 US$'000
Trade payables	77	176	67
Other payables	3,129	520	2,455
Total	3,206	696	2,522

 

 

 

Notes to the Interim Condensed Consolidated Financial Statements (Continued)

For the six months ended 30 June 2010

 

15 Issued capital

 

	(Unaudited) 30 June 2010		(Unaudited) 30 June 2009		(Audited) 31 December 2009
Authorized	Number of shares	£'000	Number of shares	£'000	Number of shares	£'000
Ordinary shares of £ 0.0001 each	500,000,000	50	500,000,000	50	500,000,000	50
Issued and fully paid	Number of shares	US$'000	Number of shares	US$'000	Number of shares	US$'000
At beginning of the period	220,019,881	35	97,547,877	14	97,547,877	14
Issued on 14 December 2009*	-	-	-	-	122,472,004	20
Issued in March 2010 on exercise of ORP warrants **	190,287	-	-	-	-	-
Issued on 17 June 2010 on placing for cash***	82,200,000	12	-	-	-	-
Translation difference on change in presentation currency	-	-	-	-	-	1
At end of the period/year	302,410,168	47	97,547,877	14	220,019,881	35
Warrants
At beginning of the period/year****	-	-	25,673,238	-	25,673,238	-
Expired during the period/year****	-	-	-	-	(25,673,238)	-
At end of the period/year	-	-	25,673,238	-	-	-

 

* 122,472,004 ordinary shares were issued to Origo Resource Partners Ltd ("ORP") Shareholders on 14 December 2009 in consideration for the merger with ORP.

 

** 190,287 ordinary shares were allotted to ORP warrant holders in March 2010. 67,960 warrants were exercised before 15 January 2010 at the exercise price of 120 pence each. In accordance with the amendment to the Company's Re-Admission Document, approved at the Extraordinary General Meeting held on 11 December 2009, these ordinary shares were acquired by OPP for a consideration of 2.8 shares OPP shares for each ORP share.

 

*** 82,200,000 ordinary shares were issued to both existing and new shareholders of the Company on 17 June 2010 by way of placing at a price of 25 pence per share.

 

**** On Admission to AIM market of the London Stock Exchange on 21 December 2006, the Company issued 25,673,238 warrants entitling each warrant holder to exercise warrants held at six monthly intervals during the period of 3 years from the date of Admission, or subject to certain exception where a surplus would be available for distribution among the holders of ordinary shares, on the winding up of the Company. No warrants have been exercised since issuance and all warrants expired on 21 December 2009.

 

 

Notes to the Interim Condensed Consolidated Financial Statements (Continued)

For the six months ended 30 June 2010

 

16 Share option scheme

 

The following table illustrates the number ("No.") and weighted average exercise prices ("WAEP") of, and movements in, share options during the six months ended 30 June 2010 and 2009 and year ended 31 December 2009.

	(Unaudited) 30 June 2010		(Unaudited) 30 June 2009		(Audited) 31 December 2009
	No.	WAEP	No.	WAEP	No.	WAEP
Outstanding at 1 January	11,451,932	53.44p	10,951,932	53.15p	10,951,932	53.15p
Granted during the period/year	-	-	500,000	59.85p	500,000	59.85p
Forfeited during the period/year	-	-	-	-	-	-
Exercised during the period/year	-	-	-	-	-	-
Expired during the period/year	-	-	-	-	-	-
Outstanding at the end of the period/year	11,451,932	53.44p	11,451,932	53.44p	11,451,932	53.44p
Exercisable at the end of the period/year	7,643,595	-	5,835,262	-	7,643,595	-

 

Outstanding options include 6,800,000, 3,500,000 and 500,000 equity-settled options granted on 6 October 2006, 13 March 2008, and 06 February 2009 respectively to certain directors and employees of the Company and 651,932 equity-settled options granted on 21 December 2006 to Seymour Pierce Ltd, the Company's former nominated adviser. The Company did not enter into any share-based transactions with parties other than employees during the six months ended 30 June 2010, 2009, 2008 and 2007, except as described above.

 

 On 16 October 2009, 4,847,099 of upper share rights ("USR") were granted to certain directors, executives and key employees under the Company's joint share ownership scheme ("JSOS"). The exercise price of the USR granted is 15.50 pence compounded at 3.5% per annum over the period from the grant date to the exercise date of USR. The fair value of the USRs is estimated at the end of each reporting period using the Black-Scholes option pricing model. The contractual life of each USR granted is 10 years.

 

The following table lists the inputs to the model used to calculate the fair value of USRs for the period.

 

Weighted average share price (pence)			29.65
Exercise price (pence)			15.50
Expected weighted average mature life (years)			2
Expected volatility (%)			36.78
Expected dividend growth rate (%)			-
Risk-free interest rate (%)			5

 

The volatility assumption, measured at the standard deviation of expected share price returns, was based on a statistical analysis of the Company's daily share prices from 21 December 2006 to 30 June 2010 using source data from Bloomberg.

 

The carrying amount of the liability relating to the USR as at 30 June 2010 is US$556,000 and the expense recognised as share-based payments during the period is US$556,000.

 

 

 

Notes to the Interim Condensed Consolidated Financial Statements (Continued)

For the six months ended 30 June 2010

 

17 Related party transactions

Identification of related parties

The Group has a related party relationship with its subsidiaries, associates and key management personnel. Transactions between the Company and its subsidiaries have been eliminated on consolidation and are not disclosed in this note.

Transactions with key management personnel

The Group's key management personnel are the Executive and Non-executive directors as identified in note 5. Other than as disclosed above, there were no other significant transactions with key management personnel during the period.

Trading transactions

The following table provides the total amount of significant transactions and outstanding balances which have been entered into with related parties during the six months ended 30 June 2010, the six months ended 30 June 2009 and the year ended 31 December 2009.

	(Unaudited) 3 June 2010 US$'000	(Unaudited) 30 June 2009 US$'000	(Audited) 31 December 2009 US$'000
Amounts owed by related parties*
ChinaEquity International Holding Company Ltd**	(1,274)	580	-
Origo Resource Partners Ltd***	-	1	-
OS Consulting Ltd	105	105	105
Origo Advisers Ltd****	3	-	160
GLG Partners LP*****	89	167	77
Sales to related parties
GLG Partners LP*****	1,044	1,524	2,554
Origo Resource Partners Ltd ***	-	501	-
Origo Advisers Ltd****	-	501	621
Purchases from related parties
Li Yi Fei******	240	678	1,001

* The amounts are unsecured, non-interest bearing and have no fixed terms of repayment. In the opinion of the directors, the Company will demand the amounts within 12 months from the reporting date. Accordingly, the amounts are shown as current.

** Mr. Wang Chao Yong is the Executive Chairman of OPP and Chairman of ChinaEquity International Holding Company Ltd.

*** The Company provided consultancy services to ORP through a sub-consultancy arrangement with Origo Advisers Ltd ("OAL"), a company controlled by entities whose ultimate beneficiaries include two Directors of the Company (Mr. Rynning and Mr. Ponnert). Mr. Rynning and Mr. Ponnert also serve on the Board of ORP. The consultancy arrangement between ORP and OAL was terminated upon the completion of merger with ORP on 14 December 2009.

**** Amounts disclosed relate to services provided.

***** Funds managed by GLG Partners LP controlled 17.7% of the outstanding share capital of the Company as at 30 June 2010. The Company provides research and analysis services to GLG Partners LP under a consultancy agreement. The amounts of transactions and outstanding balances relate to research services provided.

****** Ms. Li Yi Fei is the spouse of Mr. Wang Chao Yong, the Executive Chairman of the Company. Ms. Li Yi Fei provided research and analysis services to the Company in relation to the consultancy agreement with GLG.

 

Notes to the Interim Condensed Consolidated Financial Statements (Continued)

For the six months ended 30 June 2010

 

18 Commitments and contingencies

 

·; In accordance with the Subordinated Shareholders' Loan Facility Agreement (the "Agreement") with Staur Aqua AS, the Group had committed up to a further NOK2.5 million (US$386,700) at the period end (31 December 2009: NOK4.8 million (US$835,000)) in the form of a loan to Staur Aqua AS should it be requested by Staur Aqua AS in the commitment period (ending on 3 July 2012) and subject to Staur Aqua AS satisfying the conditions set out in the Agreement.

 

·; In May 2010, the Company arranged an irrevocable Standby Letter of Credit ("L/C") with Standard Chartered Bank (Hong Kong) Limited for an aggregate amount up to US$3 million to secure the credit facilities granted by ABSA Bank Ltd to IRCA Holdings Ltd. The L/C will expire on 30 November 2010.

 

There were no other contracted commitments or contingent assets or liabilities at 30 June 2010 (31 December 2009: none) that have not been disclosed in the interim condensed consolidated financial statements.

 

19 Events after the reporting period

 

·; In August 2010, the Group made a further loan of NOK1,039,893 to Staur Aqua AS under the Subordinated Shareholders' Loan Facility Agreement.

 

·; In August 2010, the Company entered into an agreement to acquire an equity interest of approximately 16.5% in Unipower Battery Ltd. ("Unipower") for an aggregate amount of US$4.3 million. Unipower is a new venture established to provide lithium-ion batteries and related materials to China's burgeoning electric vehicle market.

 

·; In September 2010, the Company established Resource Investment Capital Ltd. ("ResCap") with Monnis International Co. Ltd. ("Monnis"), one of Mongolia's largest industrial holding companies. ResCap will provide corporate finance advisory services primarily to companies active in or seeking to enter the Mongolian natural resources sector. On a fully-diluted basis, the Company owns 35% equity interest in ResCap.

 

·; In September 2010, the Company entered into an agreement to acquire an equity interest of 25% in Kincora Ltd ("Kincora"), owner of the Bronze Fox copper-gold prospect ("Bronze Fox") in Mongolia for US$3 million. Kincora, which is a BVI registered copper and gold exploration company, owns a 100% interest in Bronze Fox through a wholly-owned Mongolian subsidiary. The Company has also been granted an exclusive option, exercisable prior to 30 June 2011, to increase its shareholding to 75% for an additional consideration of US$12 million.

 

·; In September 2010, the Company announced the sale of its 7.1% stake in E-Bill China Holding Ltd ("E-Bill"), a Chinese electronic payment services provider. The stake, acquired for US$2 million, will be sold back to E-Bill's founding shareholder for US$2.8 million in cash - a 1.4x cash to cash return on the cost of the investment.

Directors, Advisors and Other Information

 

 

Directors	Wang Chao Yong, Executive Chairman
	Chris Rynning, Chief Executive Officer
	Niklas Ponnert, Chief Financial Officer
	Christopher Jemmett, Non Executive Director
	Dipankar Basu, Non Executive Director
Country of incorporation of parent company	Isle of Man
Secretary	Sandra Georgeson
Company number	005681V
Auditors	Ernst & Young LLC
	Rose House, 51-59 Circular Road
	Douglas
	Isle of Man IM1 1AZ, United Kingdom
Nominated adviser	Liberum Capital Ltd.
	Ropemaker Place, Level 12
	25 Ropemaker Street
	London, EC2Y 9AR
Solicitors to the company	Charles Russell LLP
	8-10 New Fetter Lane
	London,EC4A 1RS
Public relations advisers	Aura Financial LLP
	The Economist Plaza,
	7th Floor,
	27 St James's Street,
	London SW1A 1HA
Broker	Liberum Capital Ltd.
	Ropemaker Place, Level 12
	25 Ropemaker Street
	London, EC2Y 9AR