8088 INVESTMENT HOLDINGS LIMITED （ 滙 友 資 本 控 股 有 限 公 司 ）*
(Incorporated in the Cayman Islands with limited liability)
(Stock Code: 8088)Hong Kong Exchanges and Clearing Limited and the Exchange 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.
This Announcement, for which the Directors of AID Partners Capital Holdings Limited collectively and individually accept full responsibility, includes particulars given in compliance with the GEM Listing Rules for the purpose of giving information with regard to AID Partners Capital Holdings Limited. The Directors of AID Partners Capital Holdings Limited, having made all reasonable enquiries, confirm that, to the best of their knowledge and belief (i) the information contained in this Announcement is accurate and complete in all material respects and not misleading or deceptive; and (ii) there are no other matters the omission of which would make any statement in this Announcement misleading.
* For identification purposes only
ABOUT AID PARTNERS CAPITAL HOLDINGS LIMITEDAID Partners Capital Holdings Limited ('AID Partners' or the 'Company' and, together with its subsidiaries, the 'Group') is an independent asset management group listed on the Hong Kong Stock Exchange's GEM board (HK GEM 8088).
The Group is engaged in the businesses of asset management and strategic investment.
During the nine months under review, the Group has continued to expand in the businesses of asset management and strategic investment. Our asset management business represents fund management business under AID Partners Asset Management Limited. Our strategic investment business represents the business of, among others, HMV Ideal Limited ('HMV Ideal') and its subsidiaries (the 'HMV Ideal Group'), Complete Star Limited ('CSL') and its subsidiary (the 'CSL Group') and Honestway Global Group Limited ('HGGL') and its subsidiaries (the 'HGGL Group').
Business Review
HMV Ideal Group currently operates a HMV retail store in Central. Since the acquisition of HMV Ideal in February 2014, the Group has been capitalising on the 'HMV' brand and continue to build an integrated online and offline business ecology in the entertainment and lifestyle sectors. Consistent with this strategy, on 28 August 2015, the Group announced the acquisition of the rights to use the name 'HMV', the various HMV trade marks and the trade mark applications and the HMV domain names for the purposes of conducting the retailing business of 'HMV' in the People's Republic of China (the 'PRC'), Hong Kong and Singapore (the 'HMV IP Rights') (the 'HMV Acquisition'). The HMV Acquisition has been approved in the extraordinary general meeting held on 3 November 2015 and its completion is expected to fall on a date on or around 30 November 2015.
The HMV Acquisition will further put the Group in a favourable position to continue to develop and enhance its existing businesses, realise synergies, and to facilitate the roll-out of other business initiatives that are complementary to the Group's strategies. The HMV Acquisition will allow the Group to consolidate the market presence of 'HMV' in Hong Kong, hence enhancing the brand value 'HMV', and gain immediate access to a well- established retail network in Hong Kong, a market in which the 'HMV' brand has over twenty
(20) years of operating history and the assignment of the HMV IP Rights will provide the Group with opportunities to open additional stores in Hong Kong, other regions within the PRC and Singapore, as well as to explore other forms of business which might be beneficial for and complementary to the Group's 'pan-entertainment' platform.
On 2 April 2015, the Group expanded its footprint into mobile-online games industry in the PRC by completing the acquisition of 70% equity interests in the HGGL Group. The HGGL Group is principally engaged in the development, distribution and operation of mobile games. The acquisition is in line with the Group's strategy and can add value to existing investments of the Group, namely, the mobile game franchise 'Star Girl' operates by the CSL Group.
On 6 July 2015, the Group and Hong Kong HNA Holding Group Co. Limited ('HK HNA Holding') entered into a subscription agreement, pursuant to which the Group has conditionally agreed to issue, and HK HNA Holding has agreed to subscribe for, the convertible bond in the aggregate amount of HK$140 million (the '2015 Convertible Bond'). The issue of the convertible bond was completed on 20 July 2015.
On 11 August 2015, the Group completed the placing of 4,005,392,000 new shares (the 'Placing') at the Placing price of HK$0.22 per share and the total net proceeds from the Placing are approximately HK$855 million.
The issue of the 2015 Convertible Bond and the Placing enhanced the capital base and strengthened the financial position of the Company, hence enabling the continuous expansion of the existing business of the Company as well as financing new strategic investments of the Company as and when they arise. Specifically, the proceeds from the 2015 Convertible Bond and the Placing are primarily used as the investment capital for the strategic investment business of the Group, which may complement with or have synergetic value to the Group's existing investments, including, among others, (a) building the 'pan-entertainment platform' and an integrated online to offline ('O2O') ecosystem of music, video, entertainment and lifestyle; (b) the investment capital of the strategic investment opportunities to be identified;
(c) the development, investment and expansion of its asset management business and related financial platform; and (d) general working capital of the Group.
Financial Review
Revenue in the first nine months of 2015 increased to HK$82.0 million from HK$24.8 million in the corresponding period of last year. The increase in revenue was driven by the continuous improvement in the operation of the HMV retail store in Central which generated more retail sales and food and beverage income this year. The newly acquired businesses - the CSL Group in October 2014 and the HGGL Group in April 2015 - also contributed HK$13.4 million in the first nine months of 2015 and HK$32.7 million since the acquisition date up to 30 September 2015, respectively.
Total operating expenses (being distribution and selling expenses, administrative expenses and other operating expenses) in the first nine months were HK$125.3 million as compared to HK$83.9 million in the corresponding period of last year. In line with the Group's strategy, the increase in total operating expenses was mainly due to the continuous expansion of the existing business and operation of the Group and the expenses incurred by the newly acquired businesses, plus the amortisation expense of HK$23.3 million relating to the acquisitions of the HMV Ideal Group, the CSL Group and the HGGL Group.
As a result, the Group reported a loss attributable to owners of the Company in the first nine months of 2015 of HK$104.0 million as compared to a loss of HK$70.8 million in the corresponding period of last year. Excluding non-operating and one-off items (being expenses incurred for, among other things, share-based payment expense, loss on financial liabilities at fair value through profit or loss, depreciation of fixed assets, amortisation of intangible assets and finance costs), loss attributable to owners of the Company was HK$47.2 million (2014: HK$36.1 million) as to support our acquisition and expansion strategy in the nine months ended 30 September 2015.
We will continue to monitor our businesses and will focus our resources to achieve our strategy of (a) building the 'pan-entertainment platform' and an integrated online to offline ecosystem of music, video, entertainment and lifestyle; (b) investing in strategic investment opportunities; and (c) developing, investing and expanding its asset management business and related financial platform, in order to enhance the return to its shareholders.
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