Transmit Entertainment Limited 傳遞娛樂有限公司 (Incorporated in the Cayman Islands with Limited Liability) (Stock Code: 1326)
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Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement. Transmit Entertainment Limited 傳遞娛樂有限公司 (Incorporated in the Cayman Islands with limited liability) (Stock code: 1326) FINAL RESULTS ANNOUNCEMENT FOR THE YEAR ENDED 30 JUNE 2020 FINANCIAL HIGHLIGHTS • The Group recorded revenue of approximately HK$465.5 million for the year ended 30 June 2020, representing a decrease of approximately HK$202.6 million or 30.3% when compared to the corresponding period of last year while revenue in Hong Kong recorded a year-on-year decrease of approximately HK$118.2 million or 43.6%. • The Group reported a loss attributable to owners of the Company of approximately HK$126.6 million for the year ended 30 June 2020 as compared to a loss of approximately HK$35.5 million for the corresponding period of last year while the loss of the film exhibition segment in Hong Kong recorded a year-on-year increase of approximately HK$93.9 million or 286.5%. • The Group’s total assets and net assets as at 30 June 2020 were approximately HK$1,784.2 million and HK$205.6 million respectively. • The Group’s proportion of revenue from mainland China increased by 7.3 percentage points year-on-year during the year ended 30 June 2020 from approximately 57.3% of last year to approximately 64.6% of which new business in relation to internet celebrity and fan-driven economy accounted for 4.0% of the total revenue of the Group. • The pan entertainment and other businesses recorded revenue of approximately HK$ 18.5 million during the year ended 30 June 2020, representing an increase of approximately 97.5% from approximately HK$9.4 million as compared to last year. • The profit of the film, TV series and variety show production and distribution segment during the year ended 30 June 2020 increased by approximately 20.6% to approximately HK$61.1 million from approximately HK$50.7 million of last year. – 1 – RESULTS FOR THE YEAR ENDED 30 JUNE 2020 CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME For the year ended 30 June 2020 2020 2019 NOTES HK$’000 HK$’000 Revenue 3 465,534 668,130 Cost of sales (291,830) (405,843) Gross profit 173,704 262,287 Other gains and losses 5 (580) 21,055 Other income 5 42,348 11,347 Selling and distribution expenses (181,793) (207,271) Administrative expenses (60,997) (67,316) Net foreign exchange loss (2,210) (226) Impairment loss on property, plant and equipment 10 (2,189) – Impairment loss on interests in associates 14 – (16,317) Impairment loss on trade receivables under expected credit loss model 16 (2,998) – Impairment loss on right-of-use assets 11 (28,895) – Fair value change on contingent consideration payable (6,161) (20,511) Finance costs 6 (57,630) (11,630) Share of results of associates 14 (855) (1,484) Share of results of a joint venture (6) 97 Loss before tax (128,262) (29,969) Income tax credit (expense) 7 885 (5,719) Loss for the year 8 (127,377) (35,688) – 2 – 2020 2019 NOTE HK$’000 HK$’000 Other comprehensive (expense) income for the year Items that may be reclassified subsequently to profit or loss Reclassification adjustments upon disposal of a subsidiary included in profit or loss – 165 Reclassification adjustments upon disposal of an associate included in profit or loss (321) – Share of exchange difference of a joint venture arising on translating foreign operation – (133) Share of exchange difference of an associate arising on translating foreign operation – 305 Exchange difference arising on translating foreign operation (1,144) 5,266 (1,465) 5,603 Total comprehensive expenses for the year (128,842) (30,085) Loss for the year attributable to: – Owners of the Company (126,598) (35,504) – Non-controlling interests (779) (184) (127,377) (35,688) Total comprehensive expenses for the year attributable to: – Owners of the Company (128,063) (29,901) – Non-controlling interests (779) (184) (128,842) (30,085) Loss per share 9 Basic (HK cents) (4.88) (1.37) – 3 – CONSOLIDATED STATEMENT OF FINANCIAL POSITION At 30 June 2020 2020 2019 NOTES HK$’000 HK$’000 Non-current assets Property, plant and equipment 10 74,689 88,281 Right-of-use assets 11 668,311 – Goodwill 12 448,173 411,876 Intangible assets 13 102,416 5,600 Interests in associates 14 – 8,418 Interest in a joint venture 163 169 Rental deposits 14,878 30,358 Deferred tax assets 297 161 1,308,927 544,863 Current assets Film and television rights 15 – 4,787 Film and television series production in progress 15 163,736 134,203 Inventories 1,249 685 Trade and other receivables 16 126,281 162,719 Contract assets 16,599 – Rental deposits 13,389 19,163 Tax recoverable – 713 Financial assets at fair value through profit or loss 7,040 – Restricted bank balances 13,098 – Pledged bank deposits 21,667 664 Bank balances and cash 112,263 122,035 475,322 444,969 – 4 – 2020 2019 NOTES HK$’000 HK$’000 Current liabilities Trade and other payables 17 215,806 219,555 Contract liabilities 60,695 46,562 Tax payable 5,713 5,585 Bank and other borrowings 18 22,000 65,220 Loans from related companies 19 30,303 64,274 Amount due to a controlling shareholder 27,500 – Bonds payable 22,000 – Amount due to a joint venture 385 385 Contingent consideration payable 145,262 139,235 Lease liabilities 20 71,962 – 601,626 540,816 Net current liabilities (126,304) (95,847) Total assets less current liabilities 1,182,623 449,016 Non-current liabilities Deposits received 17 383 950 Bonds payable 29,500 22,000 Bank and other borrowings 18 45,000 – Loan from a related company 19 89,721 161,695 Contingent consideration payable 103,693 178,155 Deferred tax liabilities 23,231 – Lease liabilities 20 685,490 – 977,018 362,800 Net assets 205,605 86,216 Capital and reserves Share capital 21 6,489 6,489 Reserves (44,373) 83,690 (Deficit in shareholder’s equity) equity attributable to owners of the Company (37,884) 90,179 Perpetual bonds 24 204,600 – Non-controlling interests 38,889 (3,963) Total equity 205,605 86,216 – 5 – CONSOLIDATED STATEMENT OF CHANGES IN EQUITY For the year ended 30 June 2020 Attributable to owners of the Company Non- Share Share Other Exchange Accumulated Perpetual controlling capital premium reserve reserve losses Sub-total bonds interests Total HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 (Note i) (Note ii) At 1 July 2018 6,489 521,046 10 (3,607) (403,858) 120,080 – (3,779) 116,301 Loss for the year – – – – (35,504) (35,504) – (184) (35,688) Reclassification adjustments upon disposal of a subsidiary included in profit or loss – – – 165 – 165 – – 165 Share of exchange difference of a joint venture arising on translating foreign operation – – – (133) – (133) – – (133) Share of exchange difference of an associate arising on translating foreign operation – – – 305 – 305 – – 305 Exchange difference arising on translating foreign operation – – – 5,266 – 5,266 – – 5,266 Total comprehensive income (expense) for the year – – – 5,603 (35,504) (29,901) – (184) (30,085) At 30 June 2019 6,489 521,046 10 1,996 (439,362) 90,179 – (3,963) 86,216 Loss for the year – – – – (126,598) (126,598) – (779) (127,377) Reclassification adjustments upon disposal of an associate included in profit or loss (note 14) – – – (321) – (321) – – (321) Exchange difference arising on translating foreign operation – – – (1,144) – (1,144) – – (1,144) Total comprehensive expense for the year – – – (1,465) (126,598) (128,063) – (779) (128,842) Capital contribution from non-controlling interest of a subsidiary – – – – – – – 5,390 5,390 Acquisition of a subsidiary (note 22) – – – – – – – 34,278 34,278 Disposal of subsidiaries – – – – – – – 3,963 3,963 Issuance of perpetual capital securities by subsidiaries (note 24) – – – – – – 204,600 – 204,600 At 30 June 2020 6,489 521,046 10 531 (565,960) (37,884) 204,600 38,889 205,605 – 6 – Notes: (i) Other reserve represents the difference between the aggregate nominal value of the respective share capital of the companies now comprising the subsidiaries of the Company over the nominal value of the shares of the Company issued pursuant to the group reorganisation completed on 5 October 2012 (the “Reorganisation”) to rationalise the structure of the Group in preparation for the listing of the Company’s shares on GEM of The Stock Exchange of Hong Kong Limited (the “Stock Exchange”). (ii) On 29 June 2020, two wholly-owned subsidiaries of the Company issued perpetual bonds (the “issuers”) amounted to RMB31,000,000 (equivalent to HK$34,100,000) and RMB155,000,000 (equivalent to HK$170,500,000), respectively to Guangzhou Puji Real Estate Agency Co. Limited, a related company in which Mr. Zhang Liang, Johnson, the Chairman and an executive director of the Company, has controlling interest, and the perpetual bonds are redeemable at the issuer’ option on or after 28 June 2025. Interests are payable annually in arrears at a fixed rate of 4.5% per annum, which may be deferred at the issuers’ discretion and in which event, the Company and the issuers will not declare or pay any interests or redeem, reduce, cancel or buy back or otherwise acquire any of the Company’s and/or the issuer’s securities of lower or equal rank.