VISION INVESTMENTS LTD RELEASED ITS FINANCIAL STATEMENTS FOR LAST FINANCIAL YEAR

Vision Investments Limited has released the Group Financial Statements for the year ended March 31, this year.

This includes the financials of the fully owned subsidiary in Papua New Guinea – Vision Homecentres Limited.

The company said in a statement that the release of the statement was delayed due to the delay in the preparation and the audit of the financial statements caused by the disruptions to day to day operations by the COVID-19 pandemic post balance date. However, the delay is within the extended time provided by South Pacific Stock Exchange(SPX).

Key highlights:

■When comparing the operating results with the previous year, it must be borne in mind that the previous year included a significant one-off increase in revenue and margin contributions relating to the Governments Home Care Scheme, which provided assistance to communities impacted by natural disasters. This benefitted the retail operations of the Company in the period May to August 2018.

■As noted in the half year financial statements market announcement in November 2019, the trading conditions during the year was subdued.

■The increase in the import duty on a range of white goods and motor vehicles half way in the year, eventually flowed through in the form of higher retail prices in these categories, which also dampened consumer demand.

■As per requirement in the accounting standards IFRS9 -Financial Instruments, an additional provision of $1.2 million was taken to allow for future potential losses in the Hire Purchase loan book of customers impacted by COVID-19 economic crisis.

■Borrowing costs increased due to additional interest costs on new borrowing to acquire a large commercial property and due to increase in the bank interest rate by 1 per cent in May 2019.

■Taking the above commentary into consideration, the Group posted profit after tax and other comprehensive income of $16.0m(2019: $23.9m) on total sales revenue of $181.6m (2019: $196.3m).

■Earnings per share was 15 cents per share compared to 23 cents per share last year.

■Total assets slightly decreased by $5.5m to $221.2m, mainly due to the decrease in the HP loan book, commensurate with the reduced revenue levels.

■The total shareholder equity increased by 6 per cent to $99.6m.

■The net debt to total capital gearing is at a comfortable 35 per cent.

■The company subsidiary in PNG, Vision Homecentres Limited incurred a loss in the year and continues to struggle in a muted economy.

■As stabilising the retail operation will take time in an economy further disrupted by the COVID-19 pandemic, consideration is now being given to reduce the scale of the business and to breakeven in the short term. This is a key area for management focus.

■During the year on November 29, 2019, the directors declared an interim dividend of 4 cents per ordinary share amounting to a dividend payment of $4,150,777.

With the economic disruptions caused by the COVID-19pandemic and in order to preserve cash reserves, the directors resolved to temporarily withhold dividend payments to shareholders as per the market announcement made on April 24, 2020.

This decision will be reviewed over the next year.

The COVID-19 pandemic has caused widespread economic disruption in Fiji. The company too is experiencing a decline in sales due to these disruptions.

The focus of the company is also to maintain sales with due consideration to the economic circumstances and in line with the Government efforts to stimulate the economy. The announcement in the recent Government budget to significantly reduce import duties on a range of goods including white goods and motor vehicles, presents an additional challenge for the company to maintain margin contributions through significant increase in sales volumes.

Of particular concern is the hardships caused to some of our HP customers due to the COVID-19 economic crisis and their ability to service their loan obligations.

As per the hardship provisions in the Consumer Credit Act, practical assistance has been extended to these customers to assist them navigate through this difficult period.