This article first appeared in The Edge Financial Daily, on March 2, 2016.
Key Alliance Group Bhd (-ve)
Shares for Key Alliance Group (KGROUP) (fundamental: 0.95/3; valuation: 0.3/3) closed unchanged at 6.5 sen yesterday, after posting wider losses for its fourth quarter ended Dec 31, 2015 (4QFY15) on Monday.
For its 4QFY15, net loss widened to RM3.5 million from RM3 million a year ago, owing to increased cost of sales from the weaker ringgit.
KGROUP also registered impairment loss on receivable of RM350,000, goodwill impairment of RM650,000, share issuance scheme expense of RM1.03 million and impairment on slow moving stocks of RM820,000 million. In comparison, impairments and fair value adjustments totalled RM1.1 million in 4QFY14.
Revenue, meanwhile, more than halved to RM10 million from RM22 million a year ago, mainly due to lower contributions from both the ICT services and kitchen appliances services segments.
For the full year, revenue fell 31.4% y-y to RM39.5 million, while net loss totalled RM8.5 million, from RM4.6 million a year ago.
On Monday, KGROUP also announced that Fatfish Medialab Pte Ltd (FMPL), its incubator partner in Singapore, sold its investee Kensington Ventures Pte Ltd to iCandy Interactive Ltd via a share-swap deal. FMPL is an accelerator specialising in the incubation of mobile applications, e-commerce and fintech areas.
KGROUP holds an indirect stake in FMPL through its 33.43% stake in Fatfish Capital Ltd (FCL) (as stated in its annual report 2014), which holds a 100% of FMPL. The remaining interest in FCL is held by Australian Stock Exchange-listed Fatfish Internet Group.
In the share swap deal, FMPL received five million shares of iCandy Interactive Ltd, which is principally involved in investing in prospective mobile interactive entertainment studios in the Asian region. iCandy was listed on the Australian Stock Exchange on 4 February 2016.
After the requisite allocation period, FMPL will be the shareholder of five million ordinary fully paid shares of iCandy at the initial public offering price of AU$0.20. iCandy currently has 229.3 million shares outstanding.
