TIDMCUSH
RNS Number : 6888F
CRUSHMETRIC Group Limited
11 July 2023
11 July 2023
CRUSHMETRIC Group Limited
(the "Company" or the "Group")
Final audited results for the year ended 31 December 20 22
CRUSHMETRIC Group Limited (AQSE: CUSH), the AQUIS Stock Exchange
quoted consumer design and production group, presents its audited
consolidated financial statements for the year ended 31 December 20
22 .
Key financial highlights:
-- Revenue for the year ended 31 December 2022: HK$10,826,825 (2021: HK$4,939,527)
-- Loss for the year: HK$5,848,042 (Loss for 2021: HK$9,455,585)
-- The basic loss per share for the year: HK$0.06 (Loss per share for 2021: HK$0.06)
-- The Group's cash position as at 31 December 2022: HK$128,658 (2021: HK$ 435,836 )
Chairman's Statement
I am pleased to report the 20 22 financial year results for
CRUSHMETRIC Group Limited.
The Company formerly engaged in TCM healthcare and skincare
products in the past years. The incidence of Covid forced a change
in focus and therefore, during 2022, the nature of the Company's
operations and its principal activities have 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 that is designed and invented by the artist
and co-founder of CRUSHMETRIC Limited, Noah Deledda. 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.
COVID-19
The continued outbreak of COVID-19 created a certain level of
unpredictable challenges to our Hong Kong and China office during
the year. However, since we have concentrated our resources in our
product sales and our sales are mainly generated from our online
platforms, this has resulted in the business being well placed to
deliver services and products to its customers without significant
disruption and with no increase in operational risk.
Review of significant activities
(i) Convertible Bond
On 19 July 2021, the Group entered into an extension agreement
for the Convertible Bond. The maturity date extended to 19 January
2023 and the coupon rate adjusted to seven-point five percent
(7.5%) per annum for the period from 20 July 2021 to 19 April 2022
and eight-point five percent (8.5%) per annum for the period from
20 April 2022 to 19 January 2023. All other terms remain unchanged.
This Convertible Bond was further extended to 19 July 2024. Please
refer to Note 29 in the non-statutory group financial statements
for details.
(ii) Executive Distribution Rights and Business Restructuring
In March 2022, the Company's wholly-owned subsidiary, MiLOC
Biotechnology Limited, was granted the exclusive distribution
rights by CRUSHMETRIC Limited ("CRUSHMETRIC") to distribute
CRUSHMETRIC's designer products including but not limited to the
CRUSHMETRIC SwitchPen in all online and offline platforms.
In June 2022, the Company announced plans to restructure the
business of the Group. Due to the Covid-19 pandemic in Hong Kong,
following the suspension of the Traditional Chinese Medicine Centre
("TCM Centre") since October 2021, the Company decided to
officially close the TCM Centre. The Company believes that by
closing the TCM Centre, it can better utilise the capital resources
of the Company and focus on more profitable business lines
including, but not limited to, the sale and distribution of
designer products under the CRUSHMETRIC brand. The Company has
shifted more resources to the business of CRUSHMETRIC SwitchPen,
through online (currently mainly through www.crushmetric.com ) and
offline platforms.
In November 2022, the Company changed its name from MiLOC Group
Limited to CRUSHMETRIC Group Limited, to better reflect the change
in the Company's new strategy. The Chinese name was removed until
the Company decided a suitable one. The ISIN of the Company remains
unchanged as "KYG613521031". The Ticker symbol was changed to
"CUSH". The Corporate website address of the Company was changed
from www.miloc.com to www.crushmetricgroup.com .
In December 2022, the Company completed the acquisition of
CRUSHMETRIC Limited. It has completed the allotments and issue of
153,486,965 new Ordinary Shares (the consideration shares) to the
former owners of CRUSHMETRIC Limited, ONG Ban Poh Michael (Chief
Executive Officer and Executive Director of the Company) ; Noah
Deledda and Lim Yi Shenn. After the share allotment, together with
the shareholding through Megasia International Limited, Mr. Ong
holds a total of 80,993,808 Ordinary Shares in the Company,
representing 33.7% of the issued shares. Mr. Deledda holds a total
of 69,683,082 Ordinary Shares in the Company, representing 29% of
the issued shares. Together with the shares previously owned, Mr.
Lim holds a total of 20,713,824 Ordinary Shares in the Company,
which represents 8.63% of the issued share capital.
(iii) Legal Proceeding of a fellow subsidiary - Star Collaboration (Guangzhou) Limited
There were five litigations and legal proceedings in one of the
Group's subsidiaries, Star Collaboration (Guangzhou) Limited ("Star
C"), where the Group holds 57% shares of this subsidiary. Details
as below:
Distributor Disputes
1. In 2021, a distributor of Star C failed to comply with the
distribution agreement, there was approximately RMB2,500,000
(Approximately GBP286,000) in outstanding debts due from this
distributor; the Civil Judgement is that the distributor should
return the amount to Star C. Status: The Company has appointed a
lawyer to follow up the outstanding debt.
2. In 2021, there was approximately RMB1,500,000 (equivalent to
approximately GBP166,000) sales under the sales agreement with
another distributor in dispute with Star C in relation to unit
price of product per item. Star C has received the result from the
Civil Judgement that it has to return such amount to the
distributor. The Company is currently negotiating the payment terms
with this distributor.
Supplier Disputes
1 and 2. One of its suppliers commenced two legal proceedings,
claiming a total of approximately RMB1,748,000 (equivalent to
approximately GBP202,470) in trade payables from the Company, that
are in dispute. Status: Star C and the supplier have signed a
settlement agreement for one of the legal proceedings, whereby Star
C has paid a total of approximately RMB500,000 (equivalent to
approximately GBP60,714) by April 2023. Star C has also signed a
settlement agreement with this supplier in May 2023 in full and
final settlement of the second legal proceeding, whereby Star C
will pay a total of approximately RMB600,000 (equivalent to
approximately GBP68,600).
3. Star C and Star C's immediate holding company (Richmond Group
Limited which is 57% held by the Company), has been notified by
another supplier of the commencement of a legal proceeding, seeking
RMB1,783,000 (approximately GBP216,500) in trade payables from the
Company, that are in dispute with regard to the amount. Status:
Star C and the supplier have signed a settlement agreement that
Star C only needs to settle a total of RMB600,000 (equivalent to
approximately GBP65,000) by monthly instalments.
(iv) Private Placings
In 2022, the Group raised approximately HK$1.59 million through
private placings. The proceeds of these subscriptions have been
used for general working capital purposes (please refer to Note 20
in the non-statutory financial statements for details of private
placings).
F inancial review
(i) Revenue , gross profit and other revenue
The launch of the CRUSHMETRIC SwitchPens contributed a
significant increase in sales during the year. The Group's audited
revenue for the year ended 31 December 2022 amounted to
HK$10,826,825 which represented a 119.2% increase as compared to
the year ended 31 December 2021. It included sale of products
(mainly from CRUSHMETRIC SwitchPens in 2022) that amounted to
approximately HK$10,826,000 (2021: approximately HK$2,955,000 of
healthcare and skincare products ). There was no revenue generated
from clinic operations in current year (20 21 : approximately HK$
1,985 ,000).
The Group's gross profit and gross profit margin for the year
ended 31 December 2022 amounted to HK$4,404,354 and 41 % (gross
loss and gross loss margin 2021: HK$213,597 and 4%) respectively.
The Group's other revenue for the year ended 31 December 202 2
amounted to HK$ 1,646, 139, a de crease of 34 % compared to the
year ended 31 December 20 21 because of payable amount written off
last year .
(ii) Operating expenses
The Group's distribution costs for the year ended 31 December 20
22 amounted to HK$ 393,306 which de creased by 2.3 % as compared to
the year ended 31 December 20 21 . The Group's administrative
expenses for the year ended 31 December 202 2 were approximately
HK$11,050,000 compared to approximately HK$ 11,254 ,000 for the
year ended 31 December 20 21 , a decrease of 1.8 %.
(iii) Profit and profit per share
The Group's loss for the year amounted to HK$5, 848 , 042 ( Loss
for 20 21 : HK$9,455,585). As a result, the Group's basic loss per
share for the year was HK$0. 06 ( Loss per share for 20 21 : HK$0.
06 ).
The Directors do not recommend the payment of a dividend.
(iv) Balance sheet items
The Group's tangible fixed assets as at 31 December 202 2
amounted to HK$ 221,258 which mainly comprised leasehold
improvements, furniture and fixtures and office equipment. A n in
crease of approximately HK$ 167 ,000 over the balance as at 31
December 20 21, was mainly due to the acquisition of a subsidiary
during the year .
The Group's other intangible assets as at 31 December 20 22
amounted to HK$ Nil which represented a decrease of HK$2,857,142
compared to HK$ 2,857,142 as at 31 December 20 21 due to fully
amortisation for the year.
The Group's goodwill as at 31 December 2022 was valued at
HK$293,993,592 with an increase of approximately HK$293,994,000
compared with HK$Nil as at 31 December 2021 due to acquisition of a
subsidiary during the year.
The Group's right-of-use assets and Lease
liabilities-right-of-use assets as at 31 December 202 2 amounted to
HK$ 370,640 and HK$ 391,180 respectively which represented a n in
crease of approximately HK$ 185 ,000 and a n in crease of
approximately HK 42 ,000 respectively as compared to the year ended
20 21 . The in crease was due to the new lease agreement signed
during the year.
The Group's inventories as at 31 December 202 2 amounted to
HK$341,561 with a n in crease of approximately HK$ 342 ,000 over
the balance as at 31 December 202 1 . This was mainly due to
purchase of inventories during the year .
The Group's other receivables and prepayments as at 31 December
202 2 amounted to HK$1,162,149 with a n in crease of approximately
HK$ 186,000 over the balance as at 31 December 20 21 .
The Group's trade payables as at 31 December 202 2 amounted to
HK$4,319,057 with a decrease of HK$ 516 ,000 over the balance as at
31 December 20 21 .
The Group's cash and cash equivalents de creased from HK$435,836
as at 31 December 20 21 to HK$128,658 as at 31 December 202 2 . For
details of these movements, please refer to the Group's cash flow
statement included in the non-statutory group financial
statements.
Outlook
The Company has changed its principal activities and
restructured its business during the year 2022. Despite the
continuous impact of Covid-19 in 2022, the Company has transformed
its business to a consumer product Group that sells various
innovative products to the market.
In the coming year, the Group will continue to focus on
promoting and generate more sales from our online distribution of
the CRUSHMETRIC series of products, including but not limited to
the CRUSHMETRIC SwitchPens and the Autohedron Chairs which were
launched. The Group will also continue to focus on R&D and
launch the CRUSHMETRIC tumbler 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 year, 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.
Ivor Colin Shrago
Chairman
10 July 2023
The audit opinion contains the following statement:
"Material uncertainty related to going concern
We draw attention to note 3 in the financial statements, which
explains, amongst other matters, that the Group is reliant on
trading materially in line with projections and, should it fail to
do so, on further support from shareholders, in particular the
Directors who have agreed not to recall their loans in a manner
that would prejudice the going concern of the Group and who have
confirmed their ongoing support to the Group's business activities
for the forthcoming twelve months. As stated in note 3, these
events or conditions, along with the other matters as set forth in
note 3, indicate that a material uncertainty exists that may cast
significant doubt on the Group's ability to continue as a going
concern. Our opinion is not modified in respect of this
matter."
The financial information in this announcement is derived from
the Group's audited consolidated financial statements for the year
ended 31 December 20 22 which are available at the Company's
website www.crushmetricgroup.com.
The Directors of the Company accept responsibility for the
contents of this announcement.
For further information, please contact:-
Crushmetric
ONG Ban Poh Michael - Chief Executive
Officer Tel: +852 2110 4221
Lo King Yu Lilian - Acting Chief Financial
Officer
AQUIS Exchange Corporate Adviser
PETERHOUSE CAPITAL LIMITED Tel: +44 (0) 20 7469
Guy Miller / Mark Anwyl 0930
CRUSHMETRIC Group Limited
Consolidated Statement of Profit or Loss and Other Comprehensive
Income
For the year ended December 20 22
20 22 20 21*
From continuing operations in 2022 HK$ HK$
------------ --------------
Revenue 10,826,825 4,939,527
------------ --------------
Cost of sales (6,422,471) (4,101,932)
------------ --------------
Impairment loss on invent ory - (1,051,552)
------------ --------------
Gross profit / (loss) 4,404,354 (213,957)
------------ --------------
Other revenue 1,646,139 2,497,506
------------ --------------
Distribution costs (393,306) (402,676)
------------ --------------
Administrative expenses (11,049,827) (1 1,253,978 )
------------ --------------
Foreign exchange gain/( los s), net (266,084) 460,283
------------ --------------
Adjusted Operating ( loss )/profit (5,658,724) (8,912,822)
------------ --------------
Impairment loss for intangible asset and goodwill - -
------------ --------------
Impairment loss on trade receivable (45,759) (143,550)
------------ --------------
Operating ( loss )/profit (5,704,483) (9,056,372)
------------ --------------
Loss on disposal of subsidiaries - -
------------ --------------
Finance costs ( 86,398) ( 399,673)
------------ --------------
Interest income 433 460
------------ --------------
(Loss)/profit before taxation (5,790,448) (9,455,585)
------------ --------------
Taxation (57,594) -
------------ --------------
(Loss)/profit for the for year (5,848,042) (9,455,585)
------------ --------------
Other comprehensive income / (loss)
------------ --------------
Exchange differences arising from translation 1,010,343 (280,737)
------------ --------------
Total comprehensive result for the year (4,837,699) (9,736,322)
------------ --------------
(Loss)/profit for the year attributable to:
------------ --------------
The equity holders of the parent entity (5,595,532) (5,216,634)
------------ --------------
Non-controlling interests (252,510) ( 4,238,951)
------------ --------------
(Loss)/profit for the for year (5,848,042) (9,455,585)
------------ --------------
Total comprehensive (loss)/profit for the year attributable to:
------------ --------------
The equity holders of the parent entity (4,585,189) (5,497,371)
------------ --------------
Non-controlling interests (252,510) ( 4,238,951 )
------------ --------------
(4,837,699) (9,736,322)
---------------------------------------------------------------- ------------ --------------
(Loss)/profit per share - from continuing operations (HK$)
------------ --------------
Basic (0.06) (0.06)
----------------------------------------------------------------- ------------ --------------
*Balances in 2021 relate to discontinued operations
CRUSHMETRIC Group Limited
Consolidated Statement of Financial Position
As of 31 December 20 22
As at 31 December 20 22 As at 31 December 20 21
HK$ HK$
----------------------- -----------------------
Assets
----------------------- -----------------------
Non-current assets
----------------------- -----------------------
Fixed assets 221,258 53,872
----------------------- -----------------------
Other intangible assets - 2,857,142
----------------------- -----------------------
Goodwill 293,993,592 -
----------------------- -----------------------
Right-of-use assets 370,640 185,826
----------------------- -----------------------
294,585,490 3,096,840
----------------------------------------- ----------------------- -----------------------
Current assets
----------------------- -----------------------
Inventories 341,561 -
----------------------- -----------------------
Trade receivables 757,271 495,904
----------------------- -----------------------
Other receivables and prepayments 1,162,149 976,100
----------------------- -----------------------
Cash and cash equivalents 128,658 435,836
----------------------- -----------------------
2,389,639 1,907,840
----------------------------------------- ----------------------- -----------------------
Total assets 296,975,129 5,004,680
----------------------- -----------------------
Equity and liabilities
----------------------- -----------------------
Equity
----------------------- -----------------------
Share capital 1,870,234 666,358
----------------------- -----------------------
Share premium 392,450,040 96,546,867
----------------------- -----------------------
Retained earnings (141,569,009) (136,983,820)
----------------------- -----------------------
Equity attributable to the parent entity 252,751,265 (39,770,595)
----------------------- -----------------------
Non-controlling interests (541,646) (289,136)
----------------------- -----------------------
Total equity 252,209,619 (40,059,731)
----------------------- -----------------------
Liabilities
----------------------- -----------------------
Current liabilities
----------------------- -----------------------
Trade payables 4,319,057 4,835,437
----------------------- -----------------------
Other payables and accruals 31,961,020 30,824,176
----------------------- -----------------------
Taxation payable 57,594 -
----------------------- -----------------------
Amounts due to d irectors 2,930,515 3,899,385
----------------------- -----------------------
Lease liabilities - right-of-use assets 275,620 348,808
----------------------- -----------------------
Borrowings 5,106,144 5,156,605
----------------------- -----------------------
44,649,950 45,064,411
----------------------------------------- ----------------------- -----------------------
Non-c urrent liabilities
----------------------- -----------------------
Lease liabilities - right-of-use assets 115,560 -
----------------------- -----------------------
Total liabilities 44,765,510 45,064,411
----------------------- -----------------------
Total equity and liabilities 296,975,129 5,004,680
-------------------------------------------- ----------------------- -----------------------
CRUSHMETRIC Group Limited
Consolidated Statement of Cash Flows
For the year ended 31 December 20 22
As at 31 December As at 31 December
20 22 20 21
HK$ HK$
----------------- -----------------
OPERATING ACTIVITIES
----------------- -----------------
Cash used in operations (1,078,397) (188,879)
----------------- -----------------
INVESTING ACTIVITIES
----------------- -----------------
Purchase of fixed assets (4,253) -
----------------- -----------------
Interest received 433 460
----------------- -----------------
Acquisition of subsidiaries, net of cash acquired 3,185 -
----------------- -----------------
Net cash used in investing activities (635) 460
----------------- -----------------
FINANCING ACTIVITIES
----------------- -----------------
Issuance of shares 1,590,000 3,647,884
----------------- -----------------
Proceed received for incorporation of a subsidiary - -
----------------- -----------------
Repayment on leases ( 555,778 ) ( 2,708,303 )
----------------- -----------------
Interest paid (283,751) (548,809)
----------------- -----------------
N et cash generated from financing activities 750,471 390,772
----------------- -----------------
Net (decrease)/ increase in cash and cash equivalents (328,561) 202,353
----------------- -----------------
Cash and cash equivalents at beginning of year 435,836 234,118
----------------- -----------------
Effects of currency translation on cash and cash equivalents 21,383 (635)
----------------- -----------------
Cash and cash equivalents at end of year 128,658 435,836
----------------- -----------------
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July 11, 2023 09:18 ET (13:18 GMT)
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