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Second Quarter Financial Statement and Dividend Announcement for the period ended 30 June 2019

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Second Quarter Financial Statement and Dividend Announcement for the period ended 30 June 2019

Consolidated statement of profit or loss
For the second quarter ended 30 June 2019

Statements of financial position
As at 30 June 2019

Group Financial Performance

The Group’s income is primarily derived from the realisation and/or revaluation of its investments.

2Q2019

For the three months ended 30 June 2019, the Group reported losses and total comprehensive deficit attributable to shareholders of S$2.36 million mainly attributed to:

(i) Fair value loss on equity investments at FVTPL (after adjusting for dividends from subsidiary of S$0.44 million) of S$2.12 million.
(ii) Operating expenses of S$1.23 million.

The losses were offset partially by:

(iii) Other operating income of S$0.75 million
(iv) Interest income of S$0.21 million arising from the loan granted to a portfolio company.

Net Asset Value ("NAV")

The Group’s NAV as at 30 June 2019 was S$123.11 million (representing a NAV of S$0.51 per share), an increase of S$8.44 million from the NAV of S$114.67 million (S$0.47 per share) as at 31 December 2018.

The increase in the Group’s NAV of S$8.44 million was largely due to fair value gains on equity investments at FVTPL (after adjusting for dividends from subsidiary) of S$11.21 million which was partially offset by dividend payment of S$2.42 million for FY2018.

Commentary

Principal international economic organisations have been downgrading forecasts in recent months, with the World Bank being the latest to lower its global economic growth forecast in 2019 to 2.6 per cent, down from its earlier projection of 2.9 per cent. The downgrade in global growth forecast reflects falling business confidence, the slowest pace of global trade growth since 2008 and sluggish growth in emerging and developing economies.

The Southeast Asian region has seen increased levels of interest from private equity and venture capital investors, especially from Chinese investors for tech start-ups as they eye opportunities arising from the region’s consumers going online. Coupled with the growing amount of dry powder, the maturing investor landscape inevitably leads to stiffer competition, higher valuations and active value creation in investment portfolios.

TIH possesses expert knowledge in corporate finance and a vast network of strategic relationships in Greater China and Southeast Asia. These will enable the Company to tap attractive opportunities for venture capital investments and long-term investments. Amidst the challenging operating environment, TIH will leverage on the uncertainty in the financial markets and continue to actively seek special situations, corporates deleveraging and non-core secondary assets at attractive valuations.

The Group’s wholly-owned subsidiary TIH Investment Management Pte. Ltd. (“TIHIM”), which has a Capital Markets Services License from the Monetary Authority of Singapore, will continue to actively engage in discussions to raise non-dilutive capital in bespoke funds that target specific opportunities. This will build up the Group’s recurring income base and tap the deep bench of proven expertise and experience assembled at TIHIM.