ORIENT TELECOMS PLC

Interim / Quarterly Report • Nov 14, 2023

National Storage Mechanism | Additional information

RNS Number : 3720T

Orient Telecoms PLC

14 November 2023

ORIENT TELECOMS PLC

("ORIENT" or the "Company")

HALF YEAR REPORT ENDED 30 SEPTEMBER 2023

ORIENT is an information technology company that offers managed services as its core business, which include managed services in machine-to-machine networking, solutions for internet of things (IOT), cyber security, big data solutions as well as full spectrum of other managed services, announces its half year report ended 30 September 2023

The interim report and accounts is available on the Company's website at: www.orient-telecoms.com 

For more information please contact: 

Orient Telecoms plc
Sayed Mustafa Ali	mustafa@orient-telecoms.com

Director's Statement

I am pleased to present the interim financial statements for Orient Telecoms Plc and its subsidiary undertaking, collectively referred to as "the Group," covering the six-month period ending on September 30, 2023.

Within this financial reporting period, the Group has recorded a net profit of £14,870, resulting in an earnings per share of 0.14 pence.

Introduction

Orient Telecoms Plc has continued to operate as a sophisticated fully managed overlay network service provider in the South East Asia Region during the past six months. This operational paradigm has conferred distinct advantages, reducing the imperative for substantial capital investments in proprietary network infrastructure, setting us apart from conventional telecommunications companies. Notably, the region has been characterized by an atmosphere of heightened anticipation and enthusiasm concerning the comprehensive deployment and expansion of 5G infrastructure and services by various cellular telecommunication operators.

Opportunities in 5G Infrastructure

The widespread rollout of 5G networks in our region has created exciting business opportunities for Orient Telecoms. Our Board is actively working on strategies to expand our range of managed services in line with the growing use of 5G technology. The increasing need for faster internet, driven by data-hungry apps, makes us a valuable provider of complete solutions. This lets telecom companies and businesses focus on what they do best while we handle their internet and tech needs.

Enhancing Services and Technology

Orient Telecoms has continued to exhibit an unwavering commitment to bolstering our product suite and managed service offerings. Our accomplished technology team is dedicated to the conception and implementation of a bespoke operating system engineered to optimize service management and operational efficacy for our esteemed clientele.

Exploration of Artificial Intelligence (AI)

In consonance with evolving market dynamics, Orient Telecoms has embarked on a definitive expedition into the realm of AI-driven applications, poised to augment our extant service offerings. Preliminary negotiations with prospective collaborators for AI-centric projects are already underway, underscoring our relentless pursuit of innovation.

Marketing and Sales Initiatives

Throughout this reporting period, our organizational focus has remained steadfast on refining our marketing endeavours, characterized by an accentuated emphasis on digital marketing initiatives. Furthermore, we have augmentatively expanded our sales personnel roster, in a concerted effort to broaden our outreach and fortify our market presence.

Operational Excellence

Our main goal is to provide services that match what our customers need. We are strongly committed to making sure our customer support is top-notch, so the quality of our service always meets and often exceeds what our customers expect.

Outlook  

Based on how well we've been doing and our strong predictions, Orient Telecoms expects to have a successful financial year ending in March 2024.

Responsibility Statement

The Board of Directors at Orient Telecoms Plc takes full responsibility for carefully preparing the interim financial statements. We follow the rules set by the United Kingdom's Financial Conduct Authority (DTR) and International Accounting Standard 34 on Interim Financial Reporting (IAS 34), which is accepted by the European Union.

We hereby affirm that, to the best of our knowledge and expertise, the interim financial statements have been meticulously and diligently crafted in strict compliance with IAS 34, as enshrined by the European Union. These financial statements encompass a thorough, objective assessment of requisite information, as prescribed by DTR 4.2.7 and DTR 4.2.8, specifically including an elucidation of pivotal events that have transpired during the initial half of the fiscal year and their consequential ramifications on the interim financial statements.

Furthermore, the document provides a comprehensive overview of the principal risks and uncertainties foreseen in the latter half of the financial period. It also undertakes an in-depth analysis of significant related-party transactions in the initial six months, accompanied by any noteworthy modifications relative to the related-party transactions delineated in the antecedent annual report.

Sayed Mustafa Ali

Director

			6 months period ended		6 months period ended
			30-Sep-23		30-Sep-22
	Notes		£		£
			(Unaudited)		(Unaudited)
INCOME	4		212,120		188,039
DIRECT COST			(20,940)		(25,081)
GROSS PROFIT			191,180		162,958
Administrative expenses			(173,255)		(186,481)
OPERATING (LOSS)/PROFIT			17,925		(23,523)
Other income			1,713		1,637
Finance income			1,351		708
Finance cost			(6,119)		(9,503)
OPERATING (LOSS)/PROFIT BEFORE TAXATION			14,870		(30,681)
Income tax expense			-		-
(LOSS)/PROFIT FOR THE PERIOD ATTRIBUTABLE TO EQUITY HOLDERS			14,870		(30,681)
OTHER COMPREHENSIVE INCOME
Items that will or may be reclassified to profit or loss:
Translation of foreign operation			-		-
TOTAL COMPREHENSIVE (LOSS)/INCOME FOR THE PERIOD			14,870		(30,681)
Basic and diluted profit per share (pence)	5		0.14		(0.31)

CONDENSED CONSOLIDATED STATEMENT OF COMPREHESIVE INCOME

FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2023

			As at		As at		As at
			30-Sep-23		31-Mar-23
			£		£
	Notes		(Unaudited)		(Audited)
ASSETS
NON-CURRENT ASSETS
Right-of-use assets	6		142,193		198,762
CURRENT ASSETS
Bank	7		263,148		329,792
Trade and other receivables	8		360,411		275,612
			623,559		605,404
CURRENT LIABILITIES
Trade and other payables	9		68,377		59,118
Lease liability	10		47,865		98,650
			116,242		157,768
NET ASSETS			649,510		646,398
EQUITY ATTRIBUTABLE TO EQUITY HOLDERS OF THE COMPANY
Share capital	11		1,000,000		1,000,000
Translation reserve			(20,011)		(13,132)
Accumulated losses			(431,339)		(446,209)
			548,650		540,659
NON- CURRENT LIABILITIES
Lease liabilities	10		100,860		105,739
			100,860		105,739
TOTAL EQUITY AND NON -CURRENT LIABILITIES			649,510		646,398

CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

AS AT 30 SEPTEMBER 2023

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2023

		6 months period ended		6 months period ended
		30-Sep-23		30-Sep-22
		£		£
		(Unaudited)		(Unaudited)
Cash flow from operating activities
(Loss)/Profit before tax		14,870		(30,681)
Adjustment for:
Translation of foreign operation		(6,880)
Unrealised exchange loss				26,993
Depreciation of right-of-use-assets		56,569		52,493
Finance income		(1,351)		(708)
Interest on lease liabilities		6,119		8,393
		69,327		56,490
Changes in working capital
(Increase)/Decrease in trade and other receivables		(84,799)		(20,095)
Increase/(Decrease) in trade and other payables		9,259		(20,682)
Cash flow from operations		(6,213)		15,713
Interest received		1,351		708
Net cash flow generated from operating activities		(4,862)		16,421
Net cash flow generated from/(used in) operating activities
Interest paid		(6,119)		(8,393)
Repayment on lease liability		(55,663)		(49,585)
Net cash flow used in financing activities		(61,782)		(57,978)
Net movement in cash and cash equivalents		(66,644)		(41,557)
Cash and cash equivalents at beginning of period		329,792		466,623
Exchange gain on cash and cash equivalents		-		-
Cash and cash equivalents at end of period		263,148		425,066

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2023

Period from 1 April 2023 to 30 September 2023 (Unaudited)

		Share capital		Translation reserve		Accumulated losses		Total
		£		£		£		£
As at 1 April 2023		1,000,000		(13,132)		(446,209)		540,659
Profit for the period		-		-		14,870		14,870
Translation of foreign operation		-		(6,879)		-		(6,879)
Total comprehensive income for the period		-		(6,879)		14,870		7,991
As at 30 September 2023		1,000,000		(20,011)		(431,339)		548,650

Period from 1 April 2022 to 30 September 2022 (Unaudited)

		Share capital		Translation reserve		Accumulated losses		Total
		£		£		£		£
As at 1 April 2022		1,000,000		(16,737)		(486,528)		496,735
Loss for the year		-		-		(30,681)		(30,681)
Translation of foreign operation		-		26,995		-		26,995
Total comprehensive income for the year		-		26,995		(30,681)		(3,686)
As at 30 September 2022		1,000,000		10,258		(517,209)		493,049

Period from 1 April 2022 to 31 March 2023 (Audited)

		Share capital		Translation reserve		Accumulated losses		Total
		£		£		£		£
As at 1 April 2022		1,000,000		(16,737)		(486,528)		496,735
Profit for the year		-		-		40,319		40,319
Translation of foreign operation		-		3,605		-		3,605
Total comprehensive income for the year		-		3,605		40,319		43,924
As at 31 March 2023		1,000,000		(13,132)		(446,209)		540,659

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENT

FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2023 (continued)

1.   GENERAL INFORMATION

The Company was incorporated in England and Wales on 26 February 2016, as a public company limited by shares under the Act. The principal legislation under which the Company operates is the Act. The registered office of the Company is at the offices of London Registrar, Suite A, 6 Honduras St, London EC1Y 0TH United Kingdom.

Shares of the Company are traded on London Stock Exchange's main market for listed securities since 2017.

2.   ACCOUNTING POLICIES

Basis of preparation

The consolidated financial information for the period ended 30 September 2023 have been prepared in accordance with IAS 34, Interim Financial Reporting. The condensed financial information is unaudited and does not constitute statutory financial statements. The comparative interim financial information covers the period from 1 April 2023 to 30 September 2023.

The principal accounting policies used in preparing the interim financial statements are the same as those applied in the Company's financial statements as at and for the year ended 31 March 2023, which have been prepared in accordance with International Financial Reporting Standards as adopted by the UK ("IFRS") issued by the International Accounting Standards Board ("IASB"), including related interpretations issued by the International Financial Reporting Interpretations Committee ("IFRIC"). The auditors' report on those accounts was unqualified and unmodified.

The condensed financial information is presented in British Pound Sterling ("£").

Going concern

These interim financial statements have been prepared on a going concern basis.

The COVID-19 pandemic lock downs in Malaysia which was implemented in March 2020 have since been removed as the country have reached its targeted immunization and with the easing of restriction businesses are moving towards normalisation. Hence, the Board sees significant opening up more opportunities for businesses.

The Company is already in an active discussion with some of the potential clients to secure new business in the forthcoming year.

The Company has enough cash balances to run its operations for next 24 months. The Company relies on outsourcing companies to perform its international service maintenance which helps the company to manage its cost better and also keep the lowest possible headcount on the payroll.

3.   CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

The preparation of unaudited interim financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expenses for the current and its corresponding financial period under review. Actual results may differ from these estimates.

In preparing the unaudited interim financial statements, the significant judgements made by the management in applying the Company's accounting policies and the sources of estimates uncertainty were consistent as those applied to the 2023 Audited Financial Statements.

There were no changes in estimates of amounts of the Company that may have a material effect on financial period ended 30 September 2023.

4.   REVENUE

Revenue represents the fair value of the consideration received or receivable for communication services. Revenue is recognised when it is probable that the economic benefits associated with a transaction will flow to the Company and the amount of revenue and associated costs can be measured reliably and over the period to which the charges relate.

		6 months period ended		6 months period ended
		30-Sep-23		30-Sep-22
Revenue		212,120		188,039
		212,120		188,039

Revenue is derived solely from Malaysia, Singapore and Thailand. Revenue excludes value added tax and other sales taxes.

5.   PROFIT PER SHARE

Basic profit per ordinary share is calculated by dividing the loss attributable to equity holders of the company by the weighted average number of ordinary shares in issue during the period. Diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares outstanding to assume conversion of all dilutive potential ordinary shares. There are currently no dilutive potential ordinary shares.

Profit per share attributed to ordinary shareholders:

		6 months period ended	Year ended	6 months period ended
		30-Sep-23	31-Mar-2023	31-Sep-22
(Loss)/Profit for the period (£)		14,870	40,319	(30,681)
Weighted average number of shares (Unit)		10,000,000	10,000,000	10,000,000
Basic and diluted profit per share (pence)		0.14	0.40	(0.31)

6.   RIGHT-OF-USE

	6 months period ended		Year ended		6 months period ended
	30-Sep-23		31-Mar-2023		30-Sep-2022
	£		£		£
Cost
Balance at beginning of period	472,598		472,598		467,262
Addition during the period	-		-		-
Exchange difference	-		-		31,988
At end of period	472,598		472,598		499,250
Accumulated depreciation
Balance at beginning of period	273,836		177,822		172,486
Charges for the period	56,569		96,014		52,493
Exchange difference	-		-		-
Balance at end of period	330,405		273,836		236,786
Net book value	142,193		198,762		262,464

The Group subsidiary leased an office which the subsidiary has entered into a non-cancellable operating lease agreement. The lease is for a period of 60 months operating lease agreement with an option to renew the lease for a further 12 months.

7.   BANK

Cash and Cash equivalents are denominated in the following currencies:

		6 months period ended		Year ended		6 months period ended
		30-Sep-23		31-Mar-23		30-Sep-2022
		£		£		£
Great Britain Pound		38,423		14,520		25,163
Singapore Dollar		20,579		20,858		21,391
United States Dollar		48,374		35,410		31,334
Malaysia Ringgit		155,772		259,005		347,178
		263,148		329,792		425,066

8.   TRADE AND OTHER RECEIVABLES

		6 months period ended		Year		6 months period ended
		30-Sep-23		31-Mar-23		30-Sep-22
		£	£		£
Trade receivables		189,580		142,599		73,263
Prepayment and Deposit		37,092		32,981		55,702
Other receivables		133,739		100,032		17,065
		360,411		275,612		146,030

9.   TRADE AND OTHER PAYABLES

	6 months		Year		6 months
	period ended		ended		period ended
	30-Sep-23		31-Mar-23		30-Sep-22
	£		£
Amount due to directors	12,068		4,830		3,185
Trade creditors	-		-		3,865
Accruals	24,433		34,108		21,339
Contract liability	-		4,125		-
Other payables	31,876		16,055		46,752
	68,377		59,118		75,141

10. LEASE LIABILITIES

Lease liabilities are payable as follow:

		6 months		Year		6 months
		period ended		ended	period ended
		30-Sep-23		31-Mar-23	30-Sep-22
		£		£		£
Less than one year		47,865		98,650		100,657
More than one year		100,860		105,739		164,713
		148,725		204,389		265,370

11. SHARE CAPITAL

		Number of		£
		ordinary shares
Paid up:
10,000,000 ordinary shares at ₤0.10 each		10,000,000		1,000,000

At 30 September 2023, the total issued ordinary share of the Company were 10,000,000.

12. SEASONAL OR CYCLICAL FACTORS

There are no seasonal factors that materially affect the Group's operation.

13. RELATED PARTY TRANSACTIONS

		6 months		6 months
		period ended		period ended
		30-Sep-23		30-Sept-22
		£		£
Amount due to directors
- Sayed Mustafa Ali		1,251		1,250
- Wong Chee Keong		1,817		1,935
- Michael Goh Seng Kim		9,000		-
		12,068		3,185

The amount due to related party is interest-free and they are payable on demand.

14. SUBSEQUENT EVENT

On 18 October 2023, The Board of Director approved to appoint Kirubarharan Ponnia as a Non-Executive Director. Following his appointment, Kirubarharan will become a member of the Audit Committee and the Nomination Committee.

Subsequently, The Company announced the resignation of Michael Goh Seng Kim as a Non-executive director of the company with effective from 19 October 2023.

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