Interim / Quarterly Report • Sep 29, 2021
Interim / Quarterly Report
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and its Subsidiary Corporations Consolidated Statement of Comprehensive Income Interim Report For the six months financial period ended 30 June 2021
| For the financial period from 1 January 2021 to |
For the financial period from 1 January 2020 to |
||
|---|---|---|---|
| Note | 30 June 2021 | 30 June 2020 | |
| (Unaudited) | |||
| \$ | \$ | ||
| Revenue | 3 | 17,104,383 | 14,476,747 |
| Other income | 4 | 1,349,516 | 3,962,884 |
| Raw materials and consumables | (10,948,784) | (11,186,963) | |
| Farm and production personnel expenses | (4,515,204) | (4,355,891) | |
| Fair value (loss)/gain on biological assets | (50,649) | 4,994,230 | |
| Fish mortalities | (1,254,897) | (636,982) | |
| Depreciation expenses | (1,863,043) | (1,681,272) | |
| Amortisation expenses | (282,150) | (260,722) | |
| Administrative expenses | (3,074,426) | (3,075,984) | |
| Distribution expenses | (1,241,063) | (1,146,299) | |
| Finance expenses | 7 | (1,241,896) | (721,082) |
| (Loss)/profit before tax | 5 | (6,018,213) | 368,666 |
| Income tax credit | 8 | - | 63,417 |
| Net (loss)/profit for the financial year | (6,018,213) | 432,083 | |
| Other comprehensive loss: Items that may be reclassified subsequently to profit or loss: |
|||
| - Currency translation loss on translating foreign operations |
(502,400) | (123,358) | |
| Total comprehensive (loss)/income for the financial year |
(6,520,613) | 308,725 | |
| (Loss)/income attributable to: | |||
| Owners of the Company | (6,420,460) | 432,083 | |
| Non-controlling interests | 402,247 | - | |
| (6,018,213) | 432,083 | ||
| Total comprehensive (loss)/income attributable to: | |||
| Owners of the Company | (6,922,860) | 308,725 | |
| Non-controlling interests | 402,247 | - | |
| (6,520,613) | 308,725 |
| Group | ||||
|---|---|---|---|---|
| Note | 30 June 2021 | 31 December 2020 | ||
| \$ | \$ | |||
| ASSETS | ||||
| Current assets | ||||
| Cash and cash equivalents | 9 | 27,354,041 | 29,327,259 | |
| Trade and other receivables | 10 | 6,861,056 | 6,408,439 | |
| Inventories | 11 | 3,096,347 | 1,966,222 | |
| Biological assets | 12 | 22,886,826 | 21,883,238 | |
| 60,198,270 | 59,585,158 | |||
| Non-current assets | ||||
| Plant and equipment | 13 | 27,523,071 | 24,916,033 | |
| Intangible assets | 15 | 13,957,533 | 14,239,683 | |
| Biological assets | 12 | 1,162,866 | 1,049,366 | |
| Other assets | - | 330,108 | ||
| Deferred income tax assets | 20 | 2,697,033 | 2,604,377 | |
| 45,340,503 | 43,139,567 | |||
| Total assets | 105,538,773 | 102,724,725 | ||
| LIABILITIES | ||||
| Current liabilities | ||||
| Trade and other payables | 16 | 9,549,495 | 20,496,590 | |
| Employee benefits | 564,931 | 525,210 | ||
| Borrowings | 17 | 35,858,182 | 17,410,568 | |
| Deferred capital grants | 18 | 75,290 | 127,999 | |
| 46,047,898 | 38,560,367 | |||
| Non-current liabilities | ||||
| Employee benefits | 112,415 | 112,854 | ||
| Borrowings | 17 | 26,630,009 | 24,945,798 | |
| Deferred capital grants | 18 | 5,129,724 | 5,244,249 | |
| Provision for reinstatement | 19 | 55,980 | 55,980 | |
| Deferred income tax liabilities | 20 | 4,050,756 | 3,958,100 | |
| 35,978,884 | 34,316,981 | |||
| Total liabilities | 82,026,782 | 72,877,348 | ||
| Net assets | 23,511,991 | 29,847,377 | ||
| EQUITY | ||||
| Share capital | 21 | 105,154,252 | 105,154,252 | |
| Other reserves | 22 | (326,470) | 79,024 | |
| Accumulated losses | (85,735,353) | (79,403,214) | ||
| Non-controlling interests | 4,419,562 | 4,017,315 | ||
| Total equity | 23,511,991 | 29,847,377 |
| Attributable to equity holders of the Group | ||||||
|---|---|---|---|---|---|---|
| Share capital | Other reserves | Accumulated losses |
Total | Non-controlling interests |
Total equity |
|
| \$ | \$ | \$ | \$ | \$ | \$ | |
| 30 June 2021 | ||||||
| Balance at 1 January 2021 | 105,154,252 | 79,024 | (79,403,214) | 25,830,062 | 4,017,315 | 29,847,377 |
| Total comprehensive loss for the period: | ||||||
| Loss for the period | - | - | (6,420,460) | (6,420,460) | 402,247 | (6,018,213) |
| Other comprehensive loss | - | (502,400) | - | (502,400) | - | (502,400) |
| - | (502,400) | (6,420,460) | (6,922,860) | 402,247 | (6,520,613) | |
| Transactions with owners, recognised directly in equity: | ||||||
| Employee share option scheme | - | 96,906 | 88,321 | 185,227 | - | 185,227 |
| - | 96,906 | 88,321 | 185,227 | - | 185,227 | |
| Balance at 30 June 2021 | 105,154,252 | (326,470) | (85,735,353) | 19,092,429 | 4,419,562 | 23,511,991 |
| 30 June 2020 (Unaudited) |
||||||
| Balance at 1 January 2020 | 105,259,252 | 4,735,231 | (71,199,601) | 38,794,882 | - | 38,794,882 |
| Total comprehensive income/(loss) for the year: |
||||||
| Profit for the year |
- | - | 432,083 | 432,083 | - | 432,083 |
| Other comprehensive loss | - | (123,358) | - | (123,358) | - | (123,358) |
| - | (123,358) | 432,083 | 308,725 | - | 308,725 | |
| Transactions with owners, recognised directly in equity: | ||||||
| Cancellation of new shares |
(105,000) | - | - | (105,000) | - | (105,000) |
| Employee share option scheme | - | (78,029) | 302,815 | 224,786 | - | 224,786 |
| Balance at 30 June 2020 | 105,154,252 | 4,533,844 | (70,464,703) | 39,223,393 | 39,223,393 |
| For the financial period from 1 January 2021 to 30 June 2021 |
For the financial period from 1 January 2020 to 30 June 2020 (Unaudited) |
|
|---|---|---|
| \$ | \$ | |
| Cash flows from operating activities | ||
| (Loss)/profit before tax | (6,018,213) | 368,666 |
| Adjustments for: | ||
| - Fair value adjustment on biological assets | 50,649 | (4,994,230) |
| - Amortisation of government grant - Depreciation of |
(167,234) | (63,962) |
| - plant and equipment and right-of-use assets |
1,809,154 | 1,649,666 |
| - biological assets |
53,889 | 31,606 |
| - Amortisation of intangible assets | 282,150 | 260,722 |
| - Employee share option expenses | 185,226 | 224,786 |
| - Interest expense | 1,241,896 | 721,082 |
| - Interest income | (53,090) | (17,898) |
| - Provision for employee benefits | 16,340 | 986 |
| - Gain on bargain purchase | - | (1,283,470) |
| (2,599,233) | (3,102,046) | |
| Changes in working capital: | ||
| - Biological assets | (686,228) | 81,542 |
| - Inventories | (1,119,604) | (547,475) |
| - Trade and other receivables | (49,271) | (914,599) |
| - Trade and other payables | 114,141 | 128,681 |
| Cash used in operations, representing cash used in operating activities |
(4,340,195) | (4,353,897) |
| Cash flows from investing activities | ||
| Acquisition of a subsidiary, net of cash acquired | - | (3,637,400) |
| Additions to property, plant and equipment | (3,828,203) | (1,438,913) |
| Interest income received | 53,090 | 17,898 |
| Net cash used in investing activities | (3,775,113) | (5,058,415) |
| For the financial period from 1 January 2021 to 30 June 2021 |
For the financial period from 1 January 2020 to 30 June 2020 (Unaudited) |
|
|---|---|---|
| \$ | \$ | |
| Cash flows from financing activities | ||
| Payment from cancellation of ordinary shares | - | (105,000) |
| Proceeds from borrowings | 9,381,634 | 7,172,431 |
| Principal payment of lease liabilities | (643,842) | (365,579) |
| Decrease in fixed deposit pledged | - | 5,132,530 |
| Interest paid | (1,241,896) | (721,082) |
| Proceeds from capital grants | - | 4,547,400 |
| Redemption of redeemable convertible preference shares |
(1,234,223) | - |
| Net cash provided by financing activities | 6,261,673 | 15,660,700 |
| Net (decrease)/increase in cash and cash equivalents | (1,853,635) | 6,248,388 |
| Cash and cash equivalents | ||
| Beginning of the financial period | 29,327,259 | 22,043,889 |
| Effects of currency translation on cash and cash | ||
| Equivalents | (119,583) | (282,113) |
| End of the financial period | 27,354,041 | 28,010,164 |
| Non-cash changes | |||||
|---|---|---|---|---|---|
| 1 January 2021 \$ |
Financing cash flows 1 \$ |
Addition during the period \$ |
Foreign exchange movement \$ |
30 June 2021 \$ |
|
| Loans and borrowings Lease |
38,828,283 | 12,621,634 | 6,516,275 | 1,298,482 | 59,264,674 |
| liabilities | 3,528,083 | (643,842) | 252,401 | 86,875 | 3,223,517 |
| Non-cash changes | |||||
| 1 January 2020 \$ |
Financing cash flows 1 \$ |
Addition during the period \$ |
Foreign exchange movement \$ |
30 June 2020 \$ |
|
| Loans and borrowings Lease |
20,381,924 | 7,172,431 | - | 159,524 | 27,713,879 |
| liabilities | 3,475,063 | (365,579) | 107,750 | 543,251 | 3,760,485 |
1 The cash flows comprise the net amount of proceeds from borrowings and repayments of borrowings in the consolidated statement of cash flows.
These notes form an integral part of and should be read in conjunction with the accompanying financial statements.
Barramundi Group Ltd. (formerly known as Barramundi Group Pte. Ltd.) ("the Company") is incorporated and domiciled in Singapore. The address of its registered office is 35 Fishery Port Road, 116 New Fish Merchant Building, Singapore 619742. These condensed consolidated interim financial statements as at and for the six months ended 30 June 2021 comprise the Company and its subsidiary corporations (together referred to as "the Group").
With effect from 6 August 2021, the name of the Company was changed from Barramundi Group Pte. Ltd. to Barramundi Group Ltd.. On 12 August 2021, the Company was listed on Euronext Growth Oslo.
The principal activities of the Company are those of commercial farming, distribution and sale of sea water barramundi.
The Company's immediate holding corporation is Barramundi Asia Holdings Pte. Ltd., incorporated in Singapore. The ultimate holding corporation is Commonwealth Harvests Pte. Ltd., incorporated in Singapore. Subsequent to the listing of the Company on 12 August 2021, Barramundi Asia Holdings Pte. Ltd. and Commonwealth Harvests Pte. Ltd. ceased to be the immediate and ultimate holding corporation of the Company and Group respectively.
On 30 January 2020, the World Health Organisation declared the outbreak a Public Health Emergency of International Concern. The outbreak was subsequently characterised as a pandemic on 11 March 2020.
In response to the pandemic, governments from different countries around the world have implemented containment measures to varying degrees in a bid to curb the spread of the virus. As a result, there has been disruption to global trade due to restrictions for cross-border movement, production stoppages, workplace closures, movement controls and other measures imposed by the various governments. The Group's significant operations are Singapore and Australia, all of which have been affected by the spread of COVID-19 in 2021.
Set out below is the impact of COVID-19 on the Group's financial performance reflected in this set of financial statements for the period ended 30 June 2021:
Continuous assessment is made for each reporting period on whether there is any indication that the Group's assets and liabilities may be impacted adversely. If any such indication of uncertainties exists, an estimate is made of the fair value of the account balances.
The interim financial information has been prepared in accordance with Singapore Financial Reporting Standards (International) ("SFRS(I)") 1-34 Interim Financial Reporting, and should be read in conjunction with the Group's last annual consolidated financial statements as at and for the financial year ended 31 December 2020. SFRS(I)s comprise Standards and Interpretations that are equivalent to international Financial Reporting Standards (IFRS Standards) issued by the International Accounting Standards Board (IASB). The accounting policies and basis of preparation adopted in the preparation of this unaudited interim financial information is consistent with those adopted in the annual consolidated financial statements for the financial year ended 31 December 2020 except for the changes in accounting policies made thereafter in adopting the new and revised Singapore Financial Reporting Standards (International) ("SFRS(I)s"), which became effective for the first time for the current period's financial information, as further detailed below. The financial information of the subsidiary corporations is prepared for the same reporting period as the Company, using consistent accounting policies. The results of subsidiary corporations are consolidated from the date on which the Group obtains control. The interim financial information is presented in Singapore Dollars ("\$"). The financial information herein contains condensed consolidated interim financial information and selected explanatory notes. The notes include explanations of events and transactions that are significant to an understanding of the changes in financial position and performance of the Group since the 2020 annual consolidated financial statements. The condensed consolidated interim financial statements and notes thereon do not include all of the information required for a full set of financial statements prepared in accordance with SFRS(I)s. The financial information relating to the financial year ended 31 December 2020 that is included in this unaudited interim financial information as comparative information does not constitute the Company's statutory annual consolidated financial statements for that year but is derived from those financial statements. The financial information relating to the financial period ended 30 June 2020 that is included in this unaudited interim financial information as comparative information has not been reviewed or audited.
The interim financial information has been prepared on a going concern basis which contemplates that the Group will be able to pay its debts as and when they fall due and payable and realise its assets and extinguish its liabilities in the ordinary course of business and at the amounts included in the financial statements.
During the financial period ended 30 June 2021, the Group recorded a net loss before tax of \$6,018,213 and net cash used in operating activities of \$4,340,197. The Group's financial results were impacted by biological asset losses of approximately \$8.6 million (AUD\$9.1 million) due to the outbreak of an algae bloom in the previous financial year. These events and conditions indicate the existence of material uncertainties that may cast significant doubt on the Group's ability to continue as a going concern.
To ensure sufficient and adequacy of funds to meet its debt obligations and working capital, management had cleared out certain financial liabilities and in August 2021 successfully fundraised \$18,225,000 (Note 27) by way of issuing ordinary shares and a listing on Euronext Growth Oslo. Management has prepared and presented a 12 months cash flow forecast to the Board of Directors which demonstrates that the Group will have sufficient funds available to continue as a going concern for at least the next 12 months.
Accordingly, the directors believe the use of the going concern assumption in preparing this interim financial information is appropriate.
On 1 January 2021, the Company has adopted the new or amended SFRS(I) and Interpretations of SFRS(I) ("INT SFRS(I)") that are mandatory for application for the financial year. Changes to the Company's accounting policies have been made as required, in accordance with the transitional provisions in the respective SFRS(I) and INT SFRS(I).
The adoption of these new or amended SFRS(I) and INT SFRS(I) did not result in substantial changes to the Company's accounting policies and had no material effect on the amounts reported for the current or prior financial years.
Revenue is measured based on the consideration to which the Group expects to be entitled in exchange for transferring promised goods or services to a customer, excluding amounts collected on behalf of third parties.
Revenue is recognised when the Group satisfies a performance obligation by transferring promised goods or services to the customer, which is when the customer obtains control of the goods or services. A performance obligation may be satisfied at a point in time or over time. The amount of revenue recognised is the amount allocated to the satisfied performance obligation.
Revenue from sale of goods and services in the ordinary course of business is recognised at a point in time when the Group satisfies its performance obligation (PO) by transferring the control of the promised goods or services to the customer, which is when the goods are delivered to the destination specified by the customer, typically based on incoterms specified in the contract. The amount of revenue recognised is the amount of the transaction price allocated to the satisfied PO.
The transaction price is allocated to each PO in the contract on the basis of the relative stand-alone selling prices of the promised goods or services. The individual standalone selling price of a good or service that has not previously been sold on a stand-alone basis, or has a highly variable selling price, is determined based on the residual portion of the transaction price after allocating the transaction price to goods and/or services with observable stand-alone selling prices. A discount or variable consideration is allocated to one or more, but not all, of the performance obligations if it relates specifically to those performance obligations.
Interest income, including income arising from financial instruments, is recognised using the effective interest method.
Grants from the government are recognised as a receivable at their fair value when there is reasonable assurance that the grant will be received and the Group will comply with all the attached conditions.
Government grants receivable are recognised as income over the periods necessary to match them with the related costs which they are intended to compensate, on a systematic basis. Government grants relating to expenses are shown separately as other income.
Government grants relating to assets are presented in the balance sheet as deferred income and is amortised to profit or loss over the expected useful life of the relevant asset by equal annual instalments.
Subsidiary corporations
(i) Consolidation
Subsidiary corporations are all entities (including structured entities) over which the Group has control. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Subsidiary corporations are fully consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date on that control ceases.
In preparing the consolidated financial statements, transactions, balances and unrealised gains on transactions between group entities are eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment indicator of the transferred asset. Accounting policies of subsidiary corporations have been changed where necessary to ensure consistency with the policies adopted by the Group.
Non-controlling interests comprise the portion of a subsidiary corporation's net results of operations and its net assets, which is attributable to the interests that are not owned directly or indirectly by the equity holders of the Company. They are shown separately in the consolidated statement of comprehensive income, statement of changes in equity, and balance sheet. Total comprehensive income is attributed to the non-controlling interests based on their respective interests in a subsidiary, even if this results in the non-controlling interests having a deficit balance.
The acquisition method of accounting is used to account for business combinations entered into by the Group.
The consideration transferred for the acquisition of a subsidiary corporation or business comprises the fair value of the assets transferred, the liabilities incurred and the equity interests issued by the Group. The consideration transferred also includes any contingent consideration arrangement and any pre-existing equity interest in the subsidiary measured at their fair values at the acquisition date.
Acquisition-related costs are expensed as incurred.
Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are, with limited exceptions, measured initially at their fair values at the acquisition date.
On an acquisition-by-acquisition basis, the Group recognises any non-controlling interest in the acquiree at the date of acquisition either at fair value or at the non-controlling interest's proportionate share of the acquiree's identifiable net assets.
The excess of (a) the consideration transferred, the amount of any non-controlling interest in the acquiree and the acquisition-date fair value of any previous equity interest in the acquiree over the (b) fair value of the identifiable net assets acquired is recorded as goodwill. Please refer to the paragraph "Intangible assets – Goodwill" for the subsequent accounting policy on goodwill.
When a change in the Group's ownership interest in a subsidiary corporation results in a loss of control over the subsidiary corporation, the assets and liabilities of the subsidiary corporation including any goodwill are derecognised. Amounts previously recognised in other comprehensive income in respect of that entity are also reclassified to profit or loss or transferred directly to retained earnings if required by a specific Standard.
Any retained equity interest in the entity is remeasured at fair value. The difference between the carrying amount of the retained interest at the date when control is lost and its fair value is recognised in profit or loss.
Please refer to the paragraph "Investments in subsidiary corporations" for the accounting policy on investments in subsidiary corporations in the separate financial statements of the Company.
Leasehold property is initially recognised at cost. It is subsequently carried at the revalued amount less accumulated depreciation and accumulated impairment losses.
Leasehold property is revalued by independent professional valuers on a triennial basis and whenever their carrying amounts are likely to differ materially from their revalued amounts. When an asset is revalued, any accumulated depreciation at the date of revaluation is eliminated against the gross carrying amount of the asset. The net amount is then restated to the revalued amount of the asset.
Increases in carrying amounts arising from revaluation, including currency translation differences, are recognised in other comprehensive income and accumulated in equity, unless they reverse a revaluation decrease of the same asset previously recognised in profit or loss. In this case, the increase is recognised in profit or loss. Decreases in carrying amounts are recognised in other comprehensive income to the extent of any credit balance existing in the equity in respect of that asset and reduces the amount accumulated in equity. All other decreases in carrying amounts are recognised in profit or loss.
(ii) Other property, plant and equipment
All other items of property, plant and equipment are initially recognised at cost and subsequently carried at cost less accumulated depreciation and accumulated impairment losses.
(iii) Components of costs
The cost of an item of property, plant and equipment initially recognised includes its purchase price and any cost that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.
(b) Depreciation
Depreciation on property, plant and equipment is calculated using the straight-line method to allocate their depreciable amounts over their estimated useful lives as follows:
| Useful lives | |
|---|---|
| Leasehold improvements | 5 - 20 years |
| Plant, equipment and boats | 3 - 20 years |
| Nets, cages and moorings | 10 - 40 years |
| Office and computer equipment | 3 - 10 years |
| Motor vehicles | 5 years |
| Leasehold land, sea and buildings | 2 - 30 years |
| Leasehold property | 30 years |
The residual values, estimated useful lives and depreciation method of property, plant and equipment are reviewed, and adjusted as appropriate, at each balance sheet date. The effects of any revision are recognised in profit or loss when the changes arise.
Fully depreciated property, plant and equipment are retained in the financial statements until they are no longer in use.
Subsequent expenditure relating to property, plant and equipment that has already been recognised is added to the carrying amount of the asset only when it is probable that future economic benefits associated with the item will flow to the entity and the cost of the item can be measured reliably. All other repair and maintenance expenses are recognised in profit or loss when incurred.
On disposal of an item of property, plant and equipment, the difference between the disposal proceeds and its carrying amount is recognised in profit or loss within "administrative expenses". Any amount in revaluation reserve relating to that item is transferred to accumulated losses directly.
Goodwill on acquisitions of subsidiary corporations and businesses, represents the excess of (i) the sum of the consideration transferred, the amount of any non-controlling interest in the acquiree and the acquisition-date fair value of any previous equity interest in the acquiree over (ii) the fair value of the identifiable net assets acquired. Goodwill on subsidiary corporations is recognised separately as intangible assets and carried at cost less accumulated impairment losses.
Gains and losses on the disposal of subsidiary corporations include the carrying amount of goodwill relating to the entity sold.
Trademarks acquired from business acquisition are capitalised at fair value at the date of acquisition. After initial recognisiton, the acquired trademarks are carried at cost less accumulated amortisation and any accumulated impairment losses. These costs are amortised to profit or loss using the straight-line method over 12.4 years, which is the shorter of their estimated useful lives and periods of contractual rights.
The amortisation period and amortisation method of intangible assets other than goodwill are reviewed at least at each balance sheet date. The effects of any revision are recognised in profit or loss when the changes arise.
Club memberships relate to the entrance fees paid for the right to use the facilities of the clubs. Club membership is measured on initial recognition at cost. The cost of club memberships is the fair value as at the date of acquisition. Subsequent to recognition, club memberships are carried at cost less any accumulated impairment losses.
Club memberships with indefinite useful lives are tested for impairment annually, or more frequently if the events and circumstances indicate that the carrying value may be impaired either individually or at the cash-generating unit level. Such club memberships are not amortised. The useful life of a club membership with an indefinite useful life is reviewed annually to determine whether the useful life assessment continues to be supportable. If not, the change in useful life from indefinite to finite is made on a prospective basis.
Gains or losses arises from de-recognition of club memberships are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognised in profit or loss when the asset is derecognised.
Borrowing costs are recognised in profit or loss using the effective interest method.
Investments in subsidiary corporations are carried at cost less accumulated impairment losses in the Company's balance sheet. On disposal of such investments, the difference between disposal proceeds and the carrying amounts of the investments are recognised in profit or loss.
(a) Goodwill
Goodwill recognised separately as an intangible asset is tested for impairment annually and whenever there is indication that the goodwill may be impaired.
For the purpose of impairment testing of goodwill, goodwill is allocated to each of the Group's cash-generating-units ("CGU") expected to benefit from synergies arising from the business combination.
An impairment loss is recognised when the carrying amount of a CGU, including the goodwill, exceeds the recoverable amount of the CGU. The recoverable amount of a CGU is the higher of the CGU's fair value less cost to sell and value-in-use.
The total impairment loss of a CGU is allocated first to reduce the carrying amount of goodwill allocated to the CGU and then to the other assets of the CGU pro-rata on the basis of the carrying amount of each asset in the CGU.
An impairment loss on goodwill is recognised as an expense and is not reversed in a subsequent period.
(b) Intangible assets
Property, plant and equipment Investments in subsidiary corporations
Intangible assets, property, plant and equipment and investments in subsidiary corporations are tested for impairment whenever there is any objective evidence or indication that these assets may be impaired.
For the purpose of impairment testing, the recoverable amount (i.e. the higher of the fair value less cost to sell and the value-in-use) is determined on an individual asset basis unless the asset does not generate cash inflows that are largely independent of those from other assets. If this is the case, the recoverable amount is determined for the cash-generating units ("CGU") to which the asset belongs.
If the recoverable amount of the asset (or CGU) is estimated to be less than its carrying amount, the carrying amount of the asset (or CGU) is reduced to its recoverable amount.
The difference between the carrying amount and recoverable amount is recognised as an impairment loss in profit or loss.
An impairment loss for an asset is reversed if, and only if, there has been a change in the estimates used to determine the asset's recoverable amount since the last impairment loss was recognised. The carrying amount of this asset is increased to its revised recoverable amount, provided that this amount does not exceed the carrying amount that would have been determined (net of accumulated depreciation) had no impairment loss been recognised for the asset in prior years.
A reversal of impairment loss for an asset other than goodwill is recognised in profit or loss.
The Group classifies and measures its financial assets at amortised cost. The classification depends on the Group's business model for managing the financial assets as well as the contractual terms of the cash flows of the financial assets.
Financial assets with embedded derivatives are considered in their entirety when determining whether their cash flows are solely payment of principal and interest.
The Group reclassifies debt instruments when and only when its business model for managing those assets changes.
At initial recognition, the Group measures a financial asset at its fair value plus, transaction costs that are directly attributable to the acquisition of the financial asset.
Debt instruments mainly comprise of cash and cash equivalents and trade and other receivables.
The following is the prescribed subsequent measurement category, depending on the Group's business model in managing the assets and the cash flow characteristics of the assets.
Debt instruments that are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interest are measured at amortised cost. A gain or loss on a debt instrument that is subsequently measured at amortised cost and is not part of a hedging relationship is recognised in profit or loss when the asset is derecognised or impaired. Interest income from these financial assets is recognised using the effective interest rate method.
The Group assesses on a forward-looking basis the expected credit losses associated with its debt financial assets carried at amortised cost. The impairment methodology applied depends on whether there has been a significant increase in credit risk. Note 10 details how the Group determines whether there has been a significant increase in credit risk.
For trade receivables, the Group applies the simplified approach permitted by SFRS(I) 9, which requires expected lifetime losses to be recognised from initial recognition of the receivables.
For cash and bank deposits and other receivables, the general 3 stage approach is applied. Credit loss allowance is based on 12-months expected credit loss if there is no significant increase in credit risk since initial recognition of the assets. If there is a significant increase in credit risk since initial recognition, lifetime expected credit loss will be calculated and recognised.
Regular way purchases and sales of financial assets are recognised on trade date – the date on which the Group commits to purchase or sell the asset.
Financial assets are derecognised when the rights to receive cash flows from the financial assets have expired or have been transferred and the Group has transferred substantially all risks and rewards of ownership.
On disposal of a debt instrument, the difference between the carrying amount and the sale proceeds is recognised in profit or loss. Any amount previously recognised in other comprehensive income relating to that asset is reclassified to profit or loss.
On disposal of an equity investment, the difference between the carrying amount and sales proceed is recognised in profit or loss if there was no election made to recognise fair value changes in other comprehensive income. If there was an election made, any difference between the carrying amount and sales proceed amount would be recognised in other comprehensive income and transferred to retained profits along with the amount previously recognised in other comprehensive income relating to that asset.
Financial assets and liabilities are offset and the net amount reported in the balance sheet when there is a legally enforceable right to offset and there is an intention to settle on a net basis or realise the asset and settle the liability simultaneously.
Borrowings are presented as current liabilities unless the Group has an unconditional right to defer settlement for at least 12 months after the reporting date, in which case they are presented as non-current liabilities.
Borrowings are initially recognised at fair value (net of transaction costs) and subsequently carried at amortised cost. Any difference between the proceeds (net of transaction costs) and the redemption value is recognised in profit or loss over the period of the borrowings using the effective interest method.
The total proceeds from convertible loans issued are allocated to the liability component and the equity component, which are separately presented on the balance sheet.
The liability component is recognised initially at its fair value, determined using a market interest rate for equivalent non-convertible loans. It is subsequently carried at amortised cost using the effective interest method until the liability is extinguished on conversion or redemption of the bonds.
The difference between the total proceeds and the liability component is allocated to the conversion option (equity component), which is presented in equity net of any deferred tax effect. The carrying amount of the conversion option is not adjusted in subsequent periods. When the conversion option is exercised, its carrying amount is transferred to the share capital. When the conversion option lapses, its carrying amount is transferred to retained profits.
Trade and other payables represent liabilities for goods and services provided to the Group prior to the end of financial year which are unpaid. They are classified as current liabilities if payment is due within one year or less (or in the normal operating cycle of the business if longer). Otherwise, they are presented as non-current liabilities.
Trade and other payables are initially recognised at fair value, and subsequently carried at amortised cost using the effective interest method.
Preference shares capital which are mandatory redeemable on a specific date are classified as financial liabilities. The dividends on these preference shares are recognised as finance expenses.
At the inception of the contract, the Group assesses if the contract contains a lease. A contract contains a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. Reassessment is only required when the terms and conditions of the contract are changed.
• Right-of-use assets
The Group recognises a right-of-use asset and lease liability at the date which the underlying asset is available for use. Right-of-use assets are measured at cost which comprises the initial measurement of lease liabilities adjusted for any lease payments made at or before the commencement date and lease incentive received. Any initial direct costs that would not have been incurred if the lease had not been obtained are added to the carrying amount of the right-of-use assets.
These right-of-use assets are subsequently depreciated using the straight-line method from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term.
Right-of-use assets are presented within "Property, plant and equipment".
• Lease liabilities
The initial measurement of a lease liability is measured at the present value of the lease payments discounted using the implicit rate in the lease, if the rate can be readily determined. If that rate cannot be readily determined, the Group shall use its incremental borrowing rate.
Lease payments include the following:
When the Group is the lessee: (continued)
• Lease liabilities (continued)
Lease liability is measured at amortised cost using the effective interest method. Lease liability shall be remeasured when:
Lease liability is remeasured with a corresponding adjustment to the right-of-use assets, or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.
• Short-term and low-value leases
The Group has elected to not recognise right-of-use assets and lease liabilities for short-term leases that have lease terms of 12 months or less and leases of low value leases. Lease payments relating to these leases are expensed to profit or loss on a straight-line basis over the lease term.
Inventories are carried at the lower of cost and net realisable value. Cost is determined using the first-in, first-out method. The cost of inventories includes all costs of purchase, costs of conversion and other costs incurred in bringing the inventories to their present location and condition. Net realisable value is the estimated selling price in the ordinary course of business, less the estimated costs of completion and applicable variable selling expenses. The amount of any write-down of inventories to net realizable value shall be recognised as an expense in the period the write-down occurs. The amount of any reversal of write-down of inventories, arising from an increase in net realizable value, shall be recognised as a reduction in the amount of inventories recognised or an expense in the period in which the reversal occurs.
The Group's biological assets comprise of a) live fish that are divided into two main groups, depending on the stage of the life cycle and b) broodstock. At the earlier stage of the life cycle, the fish are classified in group (1) immature fish in land nursery at cost. During this stage, the fish are kept on shore. When the fish are large enough for release to sea, they are classified in group (2) fish at sea. Fish at sea can be further divided into mature fish at sea at fair value and immature fish at sea at cost. The Group considers live fish weighing more than 500grams to have an active and established market. These fish are classified as mature fish at sea at fair value, while fish that have not yet achieved this weight are classified as immature fish at sea at cost.
Mature live fish at sea at fair value are carried at fair value less estimated point-of-sale costs (harvesting costs and transport costs). The Group estimates the fair value of live fish based on the biomass at sea for each location and observed market prices for harvested fish at the balance sheet date in the respective markets in which the Group operates. The observed market prices are based on historical selling prices. The adjustment for point-of-sale costs is based on the Group's historical costs per location. The difference between the fair values of the biological assets and the carrying amounts at the end of the period is recognised as a fair value adjustment in profit or loss.
Immature live fish at sea at cost could have production cost per kilogram (kg) higher than market prices per kg for harvested fish. If this is the case the fish is carried at the higher of the two if it is reasonable that the production cost will be fully covered through further farming and later sale. If further growth and sale is not expected to cover the cost of production, the fish is carried at the estimated value based on market prices.
The income or loss which will be recognised on sale may differ materially from that implied by the fair value adjustment at the end of a period. The fair value adjustment on biological assets has no cash impact and does not affect the results of operations before unrealised fair value adjustments.
Write-downs of biological assets occur due to mortality, which are expensed to profit or loss.
Broodstock is stated at cost less accumulated depreciation and any impairment losses. Broodstock is depreciated on a straight-line basis over their estimated useful lives of 9 years.
Current income tax for current and prior periods is recognised at the amount expected to be paid to or recovered from the tax authorities, using the tax rates and tax laws that have been enacted or substantively enacted by the balance sheet date. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation and considers whether it is probable that a tax authority will accept an uncertain tax treatment. The Group measures its tax balances either based on the most likely amount or the expected value, depending on which method provides a better prediction of the resolution of the uncertainty.
Deferred income tax is recognised for all temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements except when the deferred income tax arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and affects neither accounting nor taxable profit or loss at the time of the transaction.
A deferred income tax liability is recognised on temporary differences arising on investments in subsidiaries, associates and joint ventures, except where the Group is able to control the timing of the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future.
A deferred income tax asset is recognised to the extent that it is probable that future taxable profit will be available against which the deductible temporary differences and tax losses can be utilised.
Deferred income tax is measured:
Current and deferred income taxes are recognised as income or expense in profit or loss, except to the extent that the tax arises from a business combination or a transaction which is recognised directly in equity. Deferred tax arising from a business combination is adjusted against goodwill on acquisition.
Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events, it is more likely than not that an outflow of resources will be required to settle the obligation and the amount has been reliably estimated. Provisions are not recognised for future operating losses.
A provision is made using best estimates of the amount required in settlement and where the effect of the time value of money is material, the amount recognised is the present value of the expenditures expected to be required to settle the obligation using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the obligation. The increase in the provision due to passage of time is recognised in the statement of comprehensive income as finance expense.
Changes in the estimated timing or amount of the expenditure or discount rate are recognised in profit or loss when the changes arise.
Employee benefits are recognised as an expense, unless the cost qualifies to be capitalised as an asset.
Defined contribution plans are post-employment benefit plans under which the Group pays fixed contributions into separate entities such as the Central Provident Fund on a mandatory, contractual or voluntary basis. The Group has no further payment obligations once the contributions have been paid.
The Group operates an equity-settled, share-based compensation plan. The value of the employee services received in exchange for the grant of options is recognised as an expense with a corresponding increase in the share option reserve over the vesting period. The total amount to be recognised over the vesting period is determined by reference to the fair value of the options granted on grant date. Non-market vesting conditions are included in the estimation of the number of shares under options that are expected to become exercisable on the vesting date.
At each balance sheet date, the Group revises its estimates of the number of shares under options that are expected to become exercisable on the vesting date and recognise the impact of the revision of the estimates in profit or loss, with a corresponding adjustment to the share option reserve over the remaining vesting period.
When the options are exercised, the proceeds received (net of transaction costs) and the related balance previously recognised in the share option reserve are credited to the share capital account, when new ordinary shares are issued, or to the "treasury shares" account, when treasury shares are re-issued to the employees.
Employee entitlements to annual leave are recognised when they accrue to employees. A provision is made for the estimated liability for annual leave as a result of services rendered by employees up to the balance sheet date.
Items included in the financial statements of each entity in the Group are measured using the currency of the primary economic environment in which the entity operates ("functional currency"). The financial statements are presented in Singapore Dollars ("\$"), which is the functional currency of the Company.
Transactions in a currency other than the functional currency ("foreign currency") are translated into the functional currency using the exchange rates at the dates of the transactions. Currency exchange differences resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies at the closing rates at the balance sheet date are recognised in profit or loss. Monetary items include primarily financial assets (other than equity investments), contract assets and financial liabilities. However, in the consolidated financial statements, currency translation differences arising from borrowings in foreign currencies and other currency instruments designated and qualifying as net investment hedges and net investment in foreign operations, are recognised in other comprehensive income and accumulated in the currency translation reserve.
When a foreign operation is disposed of or any loan forming part of the net investment of the foreign operation is repaid, a proportionate share of the accumulated currency translation differences is reclassified to profit or loss, as part of the gain or loss on disposal.
Foreign exchange gains and losses that relate to borrowings are presented in the income statement within "finance expense". All other foreign exchange gains and losses impacting profit or loss are presented in the income statement within "administrative expenses".
Non-monetary items measured at fair values in foreign currencies are translated using the exchange rates at the date when the fair values are determined.
The results and financial position of all the Group entities (none of which has the currency of a hyperinflationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows:
Goodwill and fair value adjustments arising on the acquisition of foreign operations are treated as assets and liabilities of the foreign operations and translated at the closing rates at the reporting date.
For the purpose of presentation in the consolidated statement of cash flows, cash and cash equivalents include cash on hand, deposits with financial institutions which are subject to an insignificant risk of change in value, and bank overdrafts. Bank overdrafts are presented as current borrowings on the balance sheet. For cash subjected to restriction, assessment is made on the economic substance of the restriction and whether they meet the definition of cash and cash equivalents.
Ordinary shares are classified as equity. Incremental costs directly attributable to the issuance of new ordinary shares are deducted against the share capital account.
Preference share capital is classified as equity if it is non-redeemable, or redeemable only at the Company's option, and any dividends are discretionary. Discretionary dividends thereon are recognised as distributions within equity upon approval by the Company's shareholders.
Preference share capital is classified as a financial liability if it is redeemable on a specific date or at the option of the shareholders, or if dividend payments are not discretionary. Non-discretionary dividends thereon are recognised as interest expense in profit or loss as accrued.
Revenue represents sales of goods and services and is recognised at a point in time.
| For the financial period from 1 January 2021 to 30 June 2021 \$ |
For the financial period from 1 January 2020 to 30 June 2020 (Unaudited) \$ |
|
|---|---|---|
| Sales of goods | 17,104,383 | 14,476,747 |
| For the financial period from 1 January 2021 to 30 June 2021 \$ |
For the financial period from 1 January 2020 to 30 June 2020 (Unaudited) \$ |
|
|---|---|---|
| Interest income from bank deposits Amortisation of capital grants Insurance claim funds Grants received (1) Net foreign exchange gain Gain on bargain purchase Others |
53,090 167,234 5,357 233,812 875,074 - 14,949 |
17,898 63,962 399 786,506 1,795,456 1,283,470 15,193 |
| 1,349,516 | 3,962,884 |
(1) Grant income of \$142,287 (30.6.2020: 398,309) was recognised during the financial period under the Jobs Support Scheme (the "JSS"). The JSS is a temporary scheme introduced in the Singapore Budget 2020 to help enterprises retain local employees. Under the JSS, employers will receive cash grants in relation to the gross monthly wages of eligible employees.
For the financial period ended 30 June 2020, grant income of \$268,742 was recognised during the financial year under the Jobkeeper Grant. The Jobkeeper Grant is a program introduced in Australia, which broadly comprises a wage subsidy to help businesses keep staff employed. Under the Jobkeeper Grant, eligible employers will receive cash grants in relation to the wages of eligible employees.
The Group's loss before income tax is arrived at after charging the following:
| For the financial period from 1 January 2021 to 30 June 2021 |
For the financial period from 1 January 2020 to 30 June 2020 (Unaudited) |
|
|---|---|---|
| \$ | \$ | |
| Employee compensation (Note 6) | 7,126,919 | 5,964,526 |
| Advertisement and promotion | 510,839 | 302,711 |
| Legal and professional fees | 350,320 | 262,860 |
| For the financial period from 1 January 2021 to 30 June 2021 \$ |
For the financial period from 1 January 2020 to 30 June 2020 (Unaudited) \$ |
|
|---|---|---|
| Wages and salaries | 5,777,263 | 4,669,513 |
| Employer's contribution to defined contribution plans | 125,511 | 223,517 |
| Share-based payments | 185,226 | 224,786 |
| Other benefits | 1,038,919 7,126,919 |
846,710 5,964,526 |
| For the financial period from 1 January 2021 to 30 June 2021 \$ |
For the financial period from 1 January 2020 to 30 June 2020 (Unaudited) \$ |
|
|---|---|---|
| Interest expenses: | 632,446 | 422,449 |
| - Bank borrowings | 76,436 | 48,433 |
| - Lease liabilities | 533,014 | 250,200 |
| - Convertible loans | 1,241,896 | 721,082 |
| For the | For the | |
|---|---|---|
| financial | financial | |
| period from | period from | |
| 1 January 2021 | 1 January 2020 | |
| to | to | |
| 30 June 2021 | 30 June 2020 | |
| (Unaudited) | ||
| \$ | \$ | |
| Current income tax credit | - | 63,417 |
| 30 June 2021 \$ |
31 December 2020 \$ |
|---|---|
| 14,346,839 | 13,360,354 |
| 13,007,202 | 15,966,905 |
| 27,354,041 | 29,327,259 |
Bank deposits are pledged in relation to the security granted for certain borrowings.
| 30 June 2021 |
31 December 2020 |
|
|---|---|---|
| \$ | \$ | |
| Current | ||
| Trade receivables: | ||
| - Non-related parties | 3,882,420 | 3,783,009 |
| - Affiliated company of the Group | 37,108 | 69,281 |
| 3,919,528 | 3,852,290 | |
| Less: Loss allowance | (123,846) | (91,683) |
| 3,795,682 | 3,760,607 | |
| Other receivables- Non-related parties | 573,024 | 467,784 |
| Advances to customers | 9,418 | 11,932 |
| Deposits | 597,158 | 613,661 |
| Prepayments | 1,167,567 | 1,554,455 |
| Deferred expenses | 718,207 | - |
| 6,861,056 | 6,408,439 |
During the financial period ended 30 June 2021 and financial year ended 31 December 2020, the Group had recognised a loss allowance of \$32,163 and \$91,683 respectively against trade receivables. There is no utilisation of loss allowance for the financial period ended 30 June 2021 and financial year ended 31 December 2020.
In assessing the loss allowance for trade receivables, the Group has applied the expected credit loss model under the financial reporting standard on financial instruments. The methodology applied for impairment loss is the simplified approach to measuring expected credit loss (ECL) which uses a lifetime expected loss allowance for all trade receivables. The expected lifetime losses are recognised from initial recognition of these assets. These assets are grouped based on shared credit risk characteristics and days past due for measuring the expected credit losses. The allowance matrix is based on its historical observed default rates (over period of 36 months) over the expected life of the trade receivables and is adjusted for forward-looking estimates. At each balance sheet date, the historical observed default rates are updated and changes in the forwardlooking estimates are analysed.
At each balance sheet date, an evaluation is made whether there is a significant change on credit risk by comparing the debtor's credit risk at initial recognition (based on the original, unmodified cash flows) with the credit risk at the balance sheet date (based on the modified cash flows). Adjustment to the loss allowance is made for any increase or decrease in credit risk.
Trade receivables are written off when there is no reasonable expectation of recovery, such as a debtor failing to engage in a repayment plan with the Group and the Company. The Management considers a financial asset as default if the counterparty fails to make contractual payments within 90 days when they fall due, and writes off the financial asset when a debtor fails to make contractual payments greater than 120 days past due. Where receivables are written off, the company continues to engage in enforcement activity to attempt to recover the receivables due. Where recoveries are made, these are recognised in profit or loss.
| 30 June 2021 \$ |
31 December 2021 \$ |
|
|---|---|---|
| Finished goods | 2,633,389 | 1,693,446 |
| Feed and medication | 462,958 | 272,776 |
| 3,096,347 | 1,966,222 |
The cost of inventories recognised as an expense and included in "raw materials and consumables" amounted to \$9,697,048 (31 December 2020: \$12,052,277).
There is no write down of inventories during the financial period ended 30 June 2021 and financial year ended 31 December 2020.
| 30 June 2021 \$ |
31 December 2020 \$ |
|
|---|---|---|
| Mature fish at sea at fair value | 22,886,826 | 21,873,722 |
| Immature fish at sea at cost | 435,363 | 222,887 |
| Immature fish in nursery at cost | 53,892 | 108,495 |
| Broodstock | 673,611 | 727,500 |
| 24,049,692 | 22,932,604 |
Biological assets are presented in the balance sheet as follows:
| \$ | \$ | |
|---|---|---|
| Current | 22,886,826 | 21,883,238 |
| Non-current | 1,162,866 | 1,049,366 |
| Total | 24,049,692 | 22,932,604 |
| At the beginning of the year | 22,932,605 | 16,661,855 |
|---|---|---|
| Acquisition via business combination | - | 812,995 |
| Fish mortalities | (1,254,897) | (2,511,709) |
| Cost of fingerlings, feed and medication | 6,622,657 | 11,345,571 |
| Cost of fish harvested | (4,735,421) | (8,514,959) |
| Fair value adjustment on biological assets | (50,649) | 4,256,197 |
| Exchange rate movement | 535,397 | 882,654 |
| At the end of the year | 24,049,692 | 22,932,604 |
At 30 June 2021, the Group held 2,228,132kg (31 December 2020: 2,278,757kg) of fish in cages at sea.
| 30 June 2021 \$ |
31 December 2020 \$ |
|
|---|---|---|
| Cost | ||
| Beginning of financial year | 970,000 | - |
| Acquisition through business combinations | - | 970,000 |
| End of financial year | 970,000 | 970,000 |
| Accumulated depreciation Beginning of financial year |
242,500 | - |
| Acquisition through business combinations | - | 157,005 |
| Depreciation charge | 53,889 | 85,495 |
| End of financial year | 296,389 | 242,500 |
| Book value | ||
| End of financial year | 673,611 | 727,500 |
Refer to fair value measure Note 25 for disclosure on fair value measurement.
| Leasehold improvements |
Plant equipment and boats |
Nets, cages and moorings |
Office and computer equipment |
Motor Vehicles |
Leasehold land, sea and buildings \$ |
Leasehold property \$ |
Capital work in progress |
Total | |
|---|---|---|---|---|---|---|---|---|---|
| 30 June 2021 | \$ | \$ | \$ | \$ | \$ | \$ | \$ | ||
| Cost | |||||||||
| Balance at 1 January | |||||||||
| 2021 | 2,764,532 | 34,178,172 | 2,811,885 | 382,963 | 409,046 | 3,166,776 | 5,800,000 | 2,025,431 | 51,538,805 |
| Additions | - | 1,771,465 | 16,062 | 15,904 | 35,575 | 778,685 | - | 1,462,913 | 4,080,604 |
| Transfer from capital work | |||||||||
| in progress | - | 551,171 | - | - | - | 155,971 | - | (707,142) | - |
| Written-off | - | - | - | - | - | (16,476) | - | - | (16,476) |
| Exchange differences | - | 797,718 | - | - | - | 74,020 | - | - | 871,738 |
| Balance at 30 June 2021 | 2,764,532 | 37,298,526 | 2,827,947 | 398,867 | 444,621 | 4,158,976 | 5,800,000 | 2,781,202 | 56,474,671 |
| Accumulated depreciation and impairment Balance at 1 January |
|||||||||
| 2021 | 774,341 | 22,359,048 | 1,656,875 | 357,509 | 385,411 | 923,874 | 165,714 | - | 26,622,772 |
| Depreciation charge | 127,688 | 1,122,662 | 85,600 | 10,350 | 10,297 | 369,702 | 82,855 | - | 1,809,154 |
| Written-off | - | - | - | - | - | (16,476) | - | - | (16,476) |
| Exchange differences | - | 510,569 | - | - | - | 25,581 | - | - | 536,150 |
| Balance at 30 June 2021 | 902,029 | 23,992,279 | 1,742,475 | 367,859 | 395,708 | 1,302,681 | 248,569 | - | 28,951,600 |
| Net book value | |||||||||
| Balance at 30 June 2021 | 1,862,503 | 13,306,247 | 1,085,472 | 31,008 | 48,913 | 2,856,295 | 5,551,431 | 2,781,202 | 27,523,071 |
| Leasehold improvements |
Plant equipment and boats |
Nets, cages and moorings |
Office and computer equipment |
Motor Vehicles |
Leasehold land, sea and buildings |
Leasehold property |
Capital work in progress |
Total | |
|---|---|---|---|---|---|---|---|---|---|
| \$ | \$ | \$ | \$ | \$ | \$ | \$ | \$ | \$ | |
| Group | |||||||||
| 31 December 2020 | |||||||||
| Cost | |||||||||
| Balance at 1 January 2020 | 2,735,160 | 26,184,099 | 2,865,429 | 195,139 | 58,000 | 1,934,495 | - | 1,695,306 | 35,667,628 |
| Additions Acquisitions through |
29,372 | 2,636,841 | 27,090 | 8,879 | 15,328 | 1,171,710 | - | 907,951 | 4,797,171 |
| business combinations Transfer from capital work |
- | 3,637,350 | - | 296,898 | 335,718 | 376,857 | 5,800,000 | - | 10,446,823 |
| in progress | - | 596,914 | - | - | - | - | - | (596,914) | - |
| Written-off | - | (202,728) | (80,634) | (117,953) | - | (426,884) | - | - | (828,199) |
| Exchange differences | - | 1,325,696 | - | - | - | 110,598 | - | 19,088 | 1,455,382 |
| Balance at 31 December 2020 |
2,764,532 | 34,178,172 | 2,811,885 | 382,963 | 409,046 | 3,166,776 | 5,800,000 | 2,025,431 | 51,538,805 |
| Accumulated depreciation and impairment |
|||||||||
| Balance at 1 January 2020 |
520,195 | 16,441,888 | 1,557,945 | 145,019 | 37,838 | 610,735 | - | - | 19,313,620 |
| Depreciation charge Acquisitions through |
254,146 | 1,867,680 | 179,089 | 65,275 | 23,060 | 661,879 | 165,714 | - | 3,216,843 |
| business combinations | - | 3,356,421 | - | 257,975 | 324,513 | 42,316 | - | - | 3,981,225 |
| Written-off | - | (176,177) | (80,159) | (110,760) | - | (426,884) | - | - | (793,980) |
| Exchange differences | - | 869,236 | - | - | - | 35,828 | - | - | 905,064 |
| Balance at 31 December 2020 |
774,341 | 22,359,048 | 1,656,875 | 357,509 | 385,411 | 923,874 | 165,714 | - | 26,622,772 |
| Net book value Balance at 31 December 2020 |
1,990,191 | 11,819,124 | 1,155,010 | 25,454 | 23,635 | 2,242,902 | 5,634,286 | 2,025,431 | 24,916,033 |
Nature of the Group's leasing activities
The Group leases several assets including leasehold land, sea and buildings, and motor vehicles for the purpose of commercial farming and back office operations. The leases have varying terms and are renegotiated upon renewal.
The Group leases plant and equipment for the purpose of daily operation. The leases have varying terms and are renegotiated upon renewal.
Right-of-use assets classified within property, plant and equipment
| 30 June 2021 \$ |
31 December 2020 \$ |
|
|---|---|---|
| Leasehold land, sea and buildings | 2,147,006 | 2,242,911 |
| Plant equipment and boats | 1,168,867 | 1,292,469 |
| Motor vehicles | 32,610 | - |
| 3,348,483 | 3,535,380 | |
| 30 June 2021 \$ |
31 December 2020 \$ |
||
|---|---|---|---|
| Leasehold land, sea and buildings | 360,724 | 661,867 | |
| Plant equipment and boats | 131,469 | 358,005 | |
| Motor vehicles | 2,965 | - | |
| 495,158 | 1,019,872 |
| 30 June 2021 \$ |
31 December 2020 \$ |
||
|---|---|---|---|
| Interest expense on lease liabilities | 76,436 | 306,207 | |
| (d) | Lease expense not capitalised in lease liabilities | ||
| 30 June 2021 \$ |
31 December 2020 \$ |
Lease expenses - short-term leases 22,160 86,167
Extension options
The leases for certain leasehold land, sea and buildings contain extension periods, for which the related lease payments had not been included in lease liabilities as the Group is not reasonably certain to exercise these extension options. The Group negotiates extension options to optimise operational flexibility in terms of managing the assets used in the Group's operations. The majority of the extension options are exercisable by the Group and not by the lessor.
| Protocol asset \$ |
Club membership \$ |
Goodwill \$ |
Trademark \$ |
Total \$ |
|
|---|---|---|---|---|---|
| Group 30 June 2021 Cost Balance at |
|||||
| 1 January 2021 and 30 June 2021 |
600,000 | 15,300 | 8,726,194 | 6,104,904 | 15,446,398 |
| Accumulated amortisation Balance at |
|||||
| 1 January 2021 Amortisation charge |
192,860 42,857 |
- - |
- - |
1,013,855 239,293 |
1,206,715 282,150 |
| Balance at 30 June 2021 |
235,717 | - | - | 1,253,148 | 1,488,865 |
| Carrying amounts Balance at |
|||||
| 30 June 2021 | 364,283 | 15,300 | 8,726,194 | 4,851,756 | 13,957,533 |
| Protocol asset \$ |
Club membership \$ |
Goodwill \$ |
Trademark \$ |
Total \$ |
|
|---|---|---|---|---|---|
| Group | |||||
| 31 December 2020 | |||||
| Cost | |||||
| Balance at | |||||
| 1 January 2020 | - | 15,300 | 2,240,496 | 4,424,904 | 6,680,700 |
| Acquisition through | |||||
| business | |||||
| combinations | 600,000 | - | 6,485,698 | 1,680,000 | 8,765,698 |
| Balance at | |||||
| 31 December 2020 | 600,000 | 15,300 | 8,726,194 | 6,104,904 | 15,446,398 |
| Accumulated amortisation and impairment |
|||||
| Balance at 1 January 2020 Acquisition through business |
- | - | - | 535,269 | 535,269 |
| combinations | 128,574 | - | - | - | 128,574 |
| Amortisation charge | 64,286 | - | - | 478,586 | 542,872 |
| Balance at | 192,860 | - | - | ||
| 31 December 2020 | 1,013,855 | 1,206,715 | |||
| Carrying amounts Balance at |
|||||
| 31 December 2020 | 407,140 | 15,300 | 8,726,194 | 5,091,049 | 14,239,683 |
The useful life of the club membership is indefinite.
Goodwill of S\$2,240,496 and S\$6,485,698 belong to cash generating units ("CGUs") of Marine Produce Australia Pty Ltd and its subsidiary corporations and Barramundi Group Ltd (formerly known as Barramundi Group Pte. Ltd.) and Allegro Aqua Pte. Ltd. respectively. The Directors and management have considered and assessed reasonably possible changes for the key assumptions used for impairment assessment and have not identified any instances that could cause the carrying amount of the CGUs to exceed its recoverable amount. There are no internal and external triggering events that indicate an impairment of goodwill.
| 30 June 2021 \$ |
31 December 2020 \$ |
|
|---|---|---|
| Trade payables | ||
| - Non-related parties | 5,367,133 | 5,833,558 |
| - Affiliated companies of the Group | 86,323 | 187,319 |
| 5,453,456 | 6,020,877 | |
| Other payables – Non-related parties | 1,432,282 | 12,243,545 |
| Advances | 12,821 | 18,633 |
| Accruals | 2,650,936 | 2,213,535 |
| 9,549,495 | 20,496,590 |
Trade payables are normally settled on 30 to 90 days terms.
The carrying amounts of trade and other payables approximate their fair values.
For the financial year ended 31 December 2020, included in other payables are redeemable convertible preference shares of \$8,430,000. During the financial period ended 30 June 2021, \$1,234,000 was redeemed, \$6,186,000 was converted to convertible loans and remaining of \$1,072,000 was payable to preference shareholders.
| 30 June 2021 |
31 December 2020 |
|
|---|---|---|
| \$ | \$ | |
| Non-current liabilities: | ||
| Secured bank loans | 24,905,862 | 22,863,487 |
| Lease liabilities | 1,724,147 | 2,082,311 |
| 26,630,009 | 24,945,798 | |
| Current liabilities: | ||
| Secured bank loans | 4,962,359 | 6,581,144 |
| Lease liabilities | 1,499,370 | 1,445,772 |
| Convertible loans | 29,396,453 | 9,383,652 |
| 35,858,182 | 17,410,568 | |
| 62,488,191 | 42,356,366 |
Terms and conditions of outstanding loans and borrowings are as follows:
| 30 June 2021 | 31 December 2020 | ||||||
|---|---|---|---|---|---|---|---|
| Currency | Nominal interest rate |
Year of maturity |
Face value | Carrying | amount Face value | Carrying amount |
|
| Group | |||||||
| Secured | ABS SIBOR | ||||||
| bank loans | SGD | + 2% | 2025 | 5,000,000 | 5,000,000 | 5,000,000 | 5,000,000 |
| Secured | ABS SIBOR | ||||||
| bank loans | SGD | + 3% | 2023 | 5,000,000 | 5,245,000 | 5,000,000 | 5,245,000 |
| Secured | ABS SIBOR | ||||||
| bank loans | SGD | + 1.75% | 2023 | 4,000,000 | 3,615,000 | 4,000,000 | 4,000,000 |
| Money | |||||||
| Market | |||||||
| Line | SGD | Floating rate | - | 2,000,000 | 1,400,000 | 2,000,000 | 2,000,000 |
| Money | |||||||
| Market | ABS SIBOR | ||||||
| Line | SGD | + 2% | - | 1,000,000 | 1,000,000 | 1,000,000 | 1,000,000 |
| Third party | |||||||
| loan | SGD | 4% | 2023 | 2,000,000 | 2,000,000 | 2,000,000 | 2,000,000 |
| Secured | BBSY + | ||||||
| bank loans | AUD | 3.55% | 2027 | 4,600,000 | 4,396,489 | 5,150,000 | 5,014,489 |
| Factoring | |||||||
| facility | AUD | 5.38% | 2021 | 3,000,000 | 562,609 | 3,000,000 | 1,219,708 |
| Equipment | |||||||
| financing | AUD | 4.41–5.51% | 2024 | 6,622,763 | 4,874,279 | 4,870,339 | 4,274,024 |
| Convertible | 2020, | ||||||
| loans | SGD | 10%, 15% | 2021 | 29,396,453 | 29,396,453 | 9,383,652 | 9,383,652 |
| Factoring | ABS SIBOR | ||||||
| facility | SGD | + 3% | - | 3,000,000 | 234,046 | - | - |
The secured bank loans of the Group are secured over the following:
The loans were issued in October 2020, February 2021 and May 2021 and mature in October 2021 and August 2021 respectively.
The loans are unsecured and the principal and accrued interest are convertible, at the option of the lenders, into ordinary shares of the Company 7 days before any loan redemption period or at the maturity of the loans at a 20% discount of the latest fundraise. Interest of 10%, 15% per annum is payable quarterly in arrears and interest-free.
The convertible loans are regarded as derivative financial liabilities as they do not meet the "fixedfor-fixed" criterion.
The loans were issued in May and October 2020 and mature in May and October 2021 respectively.
The loans are unsecured and the principal and accrued interest are convertible, at the option of the lenders, into ordinary shares of the Company 7 days before any loan redemption period or at the maturity of the loans at a 20% discount of the latest fundraise. Interest of 10% and 15% per annum is payable quarterly in arrears.
The convertible loans are regarded as derivative financial liabilities as they do not meet the "fixedfor-fixed" criterion.
Refer to fair value measure Note 25 for disclosure on fair value measurement.
| 30 June 2021 \$ |
31 December 2020 \$ |
|
|---|---|---|
| Beginning of financial year | 5,372,248 | 437,037 |
| Grants received | - | 5,063,134 |
| Amortisation of deferred capital grants | (167,234) | (127,923) |
| End of financial year | 5,205,014 | 5,372,248 |
Deferred capital grants relate to government grants received for the acquisition of plant and equipment to promote productivity and innovation. There are no unfulfilled conditions or contingencies attached to these grants.
Deferred capital grants are presented in the balance sheet as follows:
| \$ | \$ | |
|---|---|---|
| Current | 75,290 | 127,999 |
| Non-current | 4,050,756 | 3,958,100 |
| Total | 5,205,014 | 5,372,248 |
Provision for reinstatement costs relates to the estimated costs of reinstating leased premises to its original condition upon vacating the premises at the end of the lease term.
Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current income tax assets against current income tax liabilities and when the deferred income taxes relate to the same taxation authority.
The amounts, determined after appropriate offsetting, are shown on the balance sheet as follows:
| 30 June 2021 \$ |
31 December 2020 \$ |
|
|---|---|---|
| (2,697,033) | (2,604,377) | |
| 4,050,756 | 3,958,100 | |
| 1,353,723 | 1,353,723 | |
| 30 June 2021 Number of shares |
31 December 2020 Number of shares |
30 June 2021 \$ |
31 December 2020 \$ |
|
|---|---|---|---|---|
| Group and Company | ||||
| Issued and paid up capital End of financial period /year |
16,069,228 | 241,038,420 | 105,154,252 | 105,154,252 |
The holders of ordinary shares are entitled to receive dividends as and when declared by the Company. All ordinary shares carry one vote per share without restriction.
The following table shows a reconciliation from the beginning balances to the ending balances for share capital:
| 30 June 2021 Number of shares |
31 December 2020 Number of shares |
30 June 2021 \$ |
31 December 2020 \$ |
|
|---|---|---|---|---|
| Group and Company | ||||
| Fully paid up ordinary shares Beginning of financial |
||||
| period /year | 241,038,420 | 241,238,420 | 105,154,252 | 105,259,252 |
| Share consolidation (a) | (224,969,207) | - | - | - |
| Cancellation of shares | - | (200,000) | - | (105,000) |
| End of financial period /year | 16,069,213 | 241,038,420 | 105,154,252 | 105,154,252 |
(a) On 5 April 2021, the Company completed a shares consolidation of every fifteen existing ordinary shares in the capital of the Company into one ordinary share (the "Share Consolidation").
The Group's objectives when managing capital are to safeguard its ability to continue as a going concern and to maintain an optimal capital structure in order to finance its operations, support business growth and maximise shareholder value.
Management reviews the capital structure on a regular basis. As part of this review, management considers the cost of capital and the risk associated with each class of capital. To maintain or adjust the capital structure, Group companies may issue new shares, return capital to shareholders, make dividend payments, increase/decrease shareholders' loans or increase/reduce bank borrowings.
The Group's overall strategy remains unchanged from the previous financial period.
Composition:
| 30 June 2021 |
31 December 2020 |
|
|---|---|---|
| \$ | \$ | |
| Equity reserve (Note (a)) | 2,854,500 | 2,854,500 |
| Employee share option reserve (Note (b)) | 1,972,960 | 1,876,054 |
| Currency translation reserve (Note (c)) | (1,561,367) | (1,058,967) |
| Capital reserve (Note(d)) | (3,592,563) | (3,592,563) |
| (326,470) | 79,024 |
(a) Equity reserve (continued)
The number and weighted-average exercise prices of warrants are as follows:
| Weighted average exercise price 30 June 2021 |
Number of options 30 June 2021 |
Weighted average exercise price 31 December 2020 |
Number of options 31 December 2020 |
|
|---|---|---|---|---|
| Beginning of the period/year | \$0.55 | 31,409,633 | \$0.55 | 31,409,633 |
| Share consolidation | NA | (29,315,657) | NA | - |
| End of the period/year | \$0.55 | 2,093,976 | \$0.55 | 31,409,633 |
| Exercisable at the end of the | ||||
| period/year | \$0.55 | 31,409,633 | \$0.55 | 31,409,633 |
Under the terms of the issuance of warrants in 2018, holders of the warrants are entitled to purchase shares at \$0.55 per share, at any time within a period of 3 years from the issue of the warrants. The fair value of the warrants has been measured using the residual method. All warrants are held by shareholders of the Company.
| 30 June 2021 \$ |
31 December 2020 \$ |
|
|---|---|---|
| Beginning of financial period/year | 1,876,054 | 2,143,928 |
| Vested during the period/year | 185,227 | 337,757 |
| Cancelled during the period/year | (88,321) | (605,631) |
| End of financial period/year | 1,972,960 | 1,876,054 |
Employee share option reserve represents the equity-settled share options granted to employees. The reserve made up of the cumulative value of services received from employees recorded over the vesting period commencing from the grant date of equity-settled share options, and is reduced by the expiry or exercise of the share options
The foreign currency translation reserve comprises all foreign exchange differences arising from the translation of the financial statements of foreign operations whose functional currencies are different from the functional currency of the Company.
Capital reserve represents excess of deemed consideration received by equity owners of the Company resulting from deemed disposal of interests in a subsidiary corporation.
Capital commitments
| Group | ||
|---|---|---|
| 30 June 2021 \$ |
31 December 2020 \$ |
|
| 773,724 | 109,279 | |
| For the financial period from 1 January 2021 to 30 June 2021 \$ |
For the financial period from 1 January 2020 to 30 June 2020 \$ |
|
|---|---|---|
| Management fee to ultimate holding corporation | 62,500 | 62,500 |
Outstanding balances as at 30 June 2021 and 30 June 2020 are unsecured and receivable/payable within 12 months from the end of the reporting period and are disclosed in Notes 10 and 16 to financial statements respectively.
| 30 June 2021 \$ |
30 June 2020 \$ |
|
|---|---|---|
| Salaries and bonuses | 744,070 | 496,033 |
| Employer's contribution to Central Provident Fund | 6,010 | 1,868 |
| Share-based payments | 185,227 | 224,786 |
| 935,307 | 722,687 |
The table below analyses recurring non-financial assets and financial instruments carried at fair value, by the levels in the fair value hierarchy based on the inputs to valuations techniques. The different levels have been defined as follows:
| Level 1 \$ |
Level 2 \$ |
Level 3 \$ |
Total \$ |
|
|---|---|---|---|---|
| 30 June 2021 | ||||
| Derivative financial instruments | ||||
| Convertible loans | - | 29,396,453 | - | 29,396,453 |
| Non-financial assets | ||||
| Consumable biological assets | - | 24,049,692 | - | 24,049,692 |
| 31 December 2020 | ||||
| Derivative financial instruments | ||||
| Convertible loans | - | 9,383,652 | - | 9,383,652 |
| Non-financial assets | ||||
| Consumable biological assets | - | 22,932,604 | - | 22,932,604 |
The following table summarises the quantitative information about the significant inputs used in Level 2 fair value measurements:
| Type | Input |
|---|---|
| Consumable biological | Based on closing biomass at observable market prices less costs to sell. |
| assets | Observable market prices are based on historical selling prices. |
| Consumable biological assets at the end of the financial period are valued | |
| based on historical selling price less costs to sell. |
Below are the mandatory standards and amendments and interpretations to existing standards that have been published and are relevant for the Group's accounting periods beginning on or after 1 July 2021 and which the Group has not early adopted.
Effective for annual periods beginning on or after 1 January 2022
Effective for annual periods beginning on or after 1 January 2023
• Amendments to SFRS(I) 10 and SFRS(I) 28 Sale or Contribution of Assets between an Investor and its Associate or Joint Venture
* The mandatory effective date of this Amendment had been revised from 1 January 2016 to a date to be determined by the Accounting Standards Council Singapore ("ASC") in December 2015 via Amendments to Effective Date of Amendments to FRS 110 and FRS 28.
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