Financial Statements And Related Announcement - Third Quarter Results
Financials Archive
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Consolidated Statement of Comprehensive Income
Q3 2020 |
Q3 2019 |
Inc/(dec) |
|
S$'000 |
S$'000 |
% |
|
| Revenue | 4,980 |
5,479 |
(9.1) |
| Cost of Sales | (2,288) |
(2,699) |
(15.2) |
| Gross profit | 2,692 |
2,780 |
(3.0) |
| Other Items of Income: | |||
| Interest Income | 33 |
23 |
43.5 |
| Other Gains | (112) |
36 |
(411.1) |
| Other Items of Expense: | |||
| Technical Support Expenses | (1,024) |
(1,178) |
(13.1) |
| Distribution Costs | (350) |
(436) |
(19.7) |
| Administrative Expenses | (485) |
(562) |
(13.7) |
| Other Losses | (644) |
187 |
(444.4) |
| Finance Costs | (28) |
(33) |
(15.1) |
| Profit Before Income Tax | 82 |
817 |
(90.2) |
| Income Tax Expenses | (86) |
112 |
(176.8) |
| (Loss)/Profit, Net of Tax | (4) |
929 |
(100.4) |
| (Loss)/Profit, Net of Tax Attributable to: | |||
| Owners of the Company | (176) |
936 |
(118.8) |
| Non-Controlling Interest | 172 |
(7) |
(2,557.1) |
| (Loss)/Profit, Net of Tax | (4) |
929 |
(100.4) |
2020 |
2019 |
Inc/(dec) |
|
S$'000 |
S$'000 |
% |
|
| Revenue | 15,753 |
17,286 |
(8.9) |
| Cost of Sales | (7,705) |
(8,234) |
(6.4) |
| Gross profit | 8,048 |
9,052 |
(11.1) |
| Other Items of Income: | |||
| Interest Income | 114 |
71 |
60.6 |
| Other Gains | 111 |
502 |
(77.9) |
| Other Items of Expense: | |||
| Technical Support Expenses | (3,036) |
(3,356) |
(9.5) |
| Distribution Costs | (1,026) |
(1,284) |
(20.1) |
| Administrative Expenses | (1,558) |
(1,733) |
(10.1) |
| Other Losses | (2,178) |
(86) |
2,432.6 |
| Finance Costs | (93) |
(100) |
(7.0) |
| Profit Before Income Tax | 382 |
3,066 |
(87.5) |
| Income Tax Expenses | (435) |
(208) |
109.1 |
| (Loss)/Profit, Net of Tax | (53) |
2,858 |
(101.9) |
| (Loss)/Profit, Net of Tax Attributable to: | |||
| Owners of the Company | (616) |
2,587 |
(123.8) |
| Non-Controlling Interest | 563 |
271 |
107.7 |
| (Loss)/Profit, Net of Tax | (53) |
2,858 |
(101.9) |
Consolidated Statement of Comprehensive Income/(Expense)
Q3 2020 |
Q3 2019 |
Inc/(dec) |
|
S$'000 |
S$'000 |
% |
|
| (Loss)/Profit, Net of Tax | (4) |
929 |
(100.4) |
| Other Comprehensive (Expenses)/Income: | |||
| Item that may be reclassified subsequently to profit or loss: | |||
| Exchange Differences on Translating Foreign Operations, Net of Tax |
371 |
198 |
(87.4) |
| Total Comprehensive(Expenses)/Income for the period | 367 |
1,127 |
(68.3) |
| Total Comprehensive Income/(Expenses) for the period Attributable to: |
|||
| Owners of the Company | 154 |
1,110 |
(86.0) |
| Non-Controlling interest | 213 |
17 |
1152.9 |
| Total Comprehensive(Expenses)/Income for the period | 367 |
1,127 |
(68.3) |
2020 |
2019 |
Inc/(dec) |
|
S$'000 |
S$'000 |
% |
|
| (Loss)/Profit, Net of Tax | (53) |
2,858 |
(101.9) |
| Other Comprehensive (Expenses)/Income: | |||
| Item that may be reclassified subsequently to profit or loss: | |||
| Exchange Differences on Translating Foreign Operations, Net of Tax |
9 |
120 |
(92.5) |
| Total Comprehensive(Expenses)/Income for the period | (44) |
2,978 |
(101.5) |
| Total Comprehensive Income/(Expenses) for the period Attributable to: |
|||
| Owners of the Company | (607) |
2,702 |
(122.5) |
| Non-Controlling interest | 563 |
276 |
103.9 |
| Total Comprehensive(Expenses)/Income for the period | (44) |
2,978 |
(101.5) |
Balance Sheet
Group |
Group |
|
As at |
As at |
|
30/9/2020 |
31/12/2019 |
|
S$'000 |
S$'000 |
|
| ASSETS | ||
| Non-Current Assets | ||
| Plant and Equipment | 1,740 |
1,690 |
| Investment Property | 2,301 |
2,301 |
| Intangible Assets | 10,867 |
10,888 |
| Investments in Subsidiaries | - |
- |
| Other Financial Assets | 9,891 |
12,073 |
| Deferred Tax assets | 1,268 |
1,362 |
| Trade and Other Receivables | 599 |
599 |
| Total Non-Current Assets | 26,666 |
28,913 |
| Current assets | ||
| Inventories | 4 |
4 |
| Trade and Other Receivables | 9,766 |
11,861 |
| Other Assets | 2,259 |
3,073 |
| Cash and Cash Equivalents | 12,124 |
10,173 |
| Total Current Assets | 24,153 |
25,111 |
| Total Assets | 50,819 |
54,024 |
| EQUITY AND LIABILITIES | ||
| Equity | ||
| Share Capital | 31,948 |
31,948 |
| Retained Earnings | 16,033 |
17,048 |
| Foreign Currency Translation Reserve | (8,233) |
(8,242) |
| Equity, Attributable to Owners of the Parent | 39,748 |
40,754 |
| Non-Controlling Interest | 4,897 |
4,655 |
| Total Equity | 44,645 |
45,409 |
| Non-Current Liabilities | ||
| Lease Liabilities | 137 |
- |
| Total Non-Current Liabilities | 137 |
- |
| Current Liabilities | ||
| Income Tax Payables | 270 |
344 |
| Trade and Other Payables | 2,766 |
4,615 |
| Other Liabilities | 1,878 |
1,931 |
| Lease Liabilities | 127 |
73 |
| Borrowings | 996 |
1,652 |
| Total Current Liabilities | 6,037 |
8,615 |
| Total Liabilities | 6,174 |
8,615 |
| Total Equity and Liabilities | 50,819 |
54,024 |
Review of results for the third quarter ended 30 September 2020 as compared to corresponding quarter ended 30 September 2019
Group Revenue
The Group recorded consolidated revenue of S$4.98 million for the quarter ended 30 September 2020 (“Q3 2020”), a decrease of 9.1% against the revenue achieved in the corresponding quarter ended 30 September 2019 (“Q3 2019”). The decline in Group revenue for Q3 2020 is attributable to lower revenue recorded by GlobeOSS.
GlobeOSS recorded revenue of S$1.968 million in Q3 2020, a decrease of 31.5% from the S$2.874 million recorded in Q3 2019. This decline in revenue was due to lower revenues from system sale contracts.
In contrast, Unifiedcomms posted revenue of S$3.012 million in Q3 2020, an increase of 15.6% from the S$2.605 million recorded in Q3 2019. This improvement in revenue was driven by higher revenues from both system sale and managed service contracts.
The Group’s sales mix in Q3 2020 showed an increase in the proportionate contribution of revenue of a recurring nature, with revenue from managed service contracts representing 77.4% of the Group’s total revenue in Q3 2020 as compared to 66.8% in Q3 2019. The shift in the Group’s sales mix in Q3 2020 is mainly attributable to a 38.4% drop in system sale contract revenue contribution from GlobeOSS from S$1.820 million in Q3 2019 to S$1.122 million in the current quarter.
Group Gross Profit and Gross Profit Margins
With the lower revenue achieved in Q3 2020, the Group recorded gross profit of S$2.692 million, a decrease of 3.2% from the S$2.780 million realised in Q3 2019. This impact was partly mitigated by higher gross profit margin of 54.1% in Q3 2020 against 50.7% in Q3 2019. This improvement in gross profit margin is mainly attributable to the lower proportionate contribution to system sale contract revenues by GlobeOSS, which generally deliver lower gross profit margin as a result of its typically higher third party cost.
In addition, gross profit margin recorded by the Group on its managed service contract revenues also increased to 52% in Q3 2020 from 49.4% in Q3 2019. This increase in managed service gross profit margin was mainly due to lower third-party cost being incurred on certain contracts.
Interest Income
The Group recorded higher interest income of S$0.033 million as compared to S$0.023 million recorded in Q3 2019, in line with higher bank balances in current reporting quarter.
Other gains
The Group had not recorded any other gain in Q3 2020, as compared to other gain of S$0.036 million in Q3 2019 mainly due to foreign exchange loss of S$0.15 million in current quarter as a result of unfavourable exchange movements of USD against SGD in Q3 2020.
Other Items of Expense
The Group recorded total expenses of S$2.531 million in Q3 2020, 26.4% higher than the S$2.002 million incurred in Q3 2019. This is mainly attributable to a fair value loss of $0.643 million assessed on the Group’s venture investment portfolio in the current quarter, as certain investees' businesses and capital raising activities were severely impacted by the CoViD-19 pandemic.
The increase in other losses resulting from the above fair value loss was partly mitigated by lower expenses recorded in overall operating expenses as a result of lower payroll related cost, stemming from CoViD 19 related government subsidy allowances received, and a reduction in administrative expenses.
Group Net Profit and EBITDA
The Group recorded a net loss of S$0.004 million and lower EBITDA of S$0.397 million in Q3 2020, as compared to S$0.929 million in net profit and S$1.115 million in EBITDA recorded by the Group in Q3 2019. The net loss and lower EBITDA recorded in Q3 2020 are mainly attributable to the flow-down effects of the lower revenue, lower other income and higher other losses due to fair value losses on the Group's venture investments.
Detailed Segmental Breakdown of Group Revenue and Gross Profit
The detailed segmental breakdown of the Group’s revenue and gross profit for Q3 2020, together with comparative results for Q3 2019 is provided below:
Table 8.1: Group consolidated revenue as analysed by business unit for the quarter ended 30 September
Q3 2020
S$'000 |
Sales mix
% |
Q3 2019
S$'000 |
Sales mix
% |
|
| Unifiedcomms | 3,012 |
60.5 |
2,605 |
47.5 |
| GlobeOSS | 1,968 |
39.5 |
2,874 |
52.5 |
| Captii Ventures | - |
- |
- |
- |
| Others | - |
- |
- |
- |
| Total | 4,980 |
100.0 |
5,479 |
100.0 |
Unifiedcomms - Segment for content-driven mobile VAS, messaging and signaling systems, solutions and managed services.
GlobeOSS - Segment for mobile network operation support systems, solutions and managed services.
Others - Segment for operational headquarters of the Group and investment holding.
Table 8.2: Group consolidated revenue as analysed by geographical segment for the quarter ended 30 September
| External Sales | Q3 2020
|
|||
Unifiedcomms
S$'000 |
GlobeOSS
S$'000 |
Others
S$'000 |
Group
S$'000 |
|
| South East Asia (SEA) | 2,800 |
1,968 |
- |
4,768 |
| South Asia (SA) | 73 |
- |
- |
73 |
| Middle East & Africa (MEA) | 139 |
- |
- |
139 |
| Others | - |
- |
- |
- |
| Total | 3,012 |
1,968 |
- |
4,980 |
| External Sales | Q3 2019
|
|||
Unifiedcomms
S$'000 |
GlobeOSS
S$'000 |
Others
S$'000 |
Group
S$'000 |
|
| SEA | 2,339 |
2,873 |
- |
5,212 |
| SA | 138 |
- |
- |
138 |
| MEA | 128 |
- |
- |
128 |
| Others | - |
1 |
- |
1 |
| Total | 2,605 |
2,874 |
- |
5,479 |
Table 8.3: Group consolidated revenue as analysed by contract type for the quarter ended 30 September
| External Sales | Q3 2020
|
Q3 2019 |
||||
System Sale(1) |
Managed Service(2) |
Group |
System Sale(1) |
Managed Service(2) |
Group |
|
| Revenue | 1,122 |
3,858 |
4,980 |
1,820 |
3,659 |
5,479 |
| Gross Profit | 684 |
2,008 |
2,692 |
973 |
1,807 |
2,780 |
| Gross Profit (%) | 61.0% |
52.0% |
54.1% |
53.5% |
49.4% |
50.7% |
(1) System Sale - this refers to contracts that involve the outright purchase by customers of systems comprising the Group's products and technologies, and where these systems are in turn delivered as turnkey solutions. The scope of work for a system sale contract includes system design, implementation, testing and commissioning services.
(2) Managed Service - this refers to contracts that involve the provision of both systems comprising the Group's products and technologies as well as the Group's professional services, on a recurring, revenue sharing, software-as-a-service, pay-per-use or monthly or quarterly fixed and variable fee basis. Also treated as a managed service contract are system maintenance and technical support contracts with existing customers of the Group.
Review of results for the nine months ended 30 September 2020 as compared to corresponding financial period ended 30 September 2019
Group Revenue
The Group recorded consolidated revenue of S$15.753 million for the nine months ended 30 September 2020 (“9M 2020”), a decrease of 8.9% against the revenue achieved in the corresponding period ended 30 September 2019 (“9M 2019”). The decline in Group revenue for 9M 2020 is mainly attributable to lower revenue recorded by Unifiedcomms.
Unifiedcomms recorded revenue of S$8.679 million in 9M 2020, a decrease of 14.4% from the S$10.135 million recorded in 9M 2019. This decline in revenue was due to lower revenues from system sale contracts.
GlobeOSS recorded revenue of S$7.074 million in 9M 2020, marginal decrease of 1.1% from the S$7.151 million recorded in 9M 2019.
The Group’s sales mix in 9M 2020 showed an increase in the proportionate contribution of revenue of a recurring nature, with revenue from managed service contracts representing 74% of the Group’s total revenue in 9M 2020 as compared to 59.7% in 9M 2019. The shift in the Group’s sales mix in 9M 2020 is mainly attributable to a 41.3% drop in system sales contract revenue contribution from Unifiedcomms and GlobeOSS, which declined from S$6.967 million in 9M 2019 to S$4.090 million.
Gross Profit and Gross Profit Margins
With the lower revenue achieved in 9M 2020, the Group recorded lower gross profit of S$8.048 million, a decrease of 11.1% from the S$9.052 million realised in 9M 2019. In addition, gross profit margin declined from 52.4% in 9M 2019 to 51.1% in 9M 2020. The decline in gross profit margin is mainly attributable to the lower proportionate contribution to system sale contract revenues by Unifiedcomms, which generally deliver higher gross profit margin. As a result, gross profit margin on the Group's system sale contract revenues decreased from 55.7% in 9M 2019 to 53.2% in 9M 2020.
The Group recorded gross profit margin on its managed service contract revenues of 50.4% in 9M 2020, marginally higher against 50.1% recorded in 9M 2019.
Interest Income
The Group recorded higher interest income of S$0.114 million as compared to S$0.071 million recorded in 9M 2019, in line with higher bank balances in current reporting period.
Other gains
The Group recorded other gains of S$0.111 million in 9M 2020, 78% lower than the S$0.502 million recorded in 9M 2019. This was mainly due to an absence of fair value gain on the Group’s venture investment portfolio.
Other Items of Expense
The Group recorded total expenses of S$7.891 million in 9M 2020, 20.3% higher than the S$6.559 million incurred in 9M 2019. This is mainly attributable to a fair value loss of $2.17 million assessed on the Group’s venture investment portfolio in the current quarter, as certain investees‘ businesses and capital raising activities were severely impacted by the CoViD-19 pandemic.
The increase in other losses resulting from the above fair value loss was partly mitigated by lower expenses recorded in overall operating expenses as a result of lower payroll related cost, stemming from CoViD 19 related government subsidy allowances received, a reduction in headcounts and an absence of foreign exchange loss.
Net Profit and EBITDA
The Group recorded a net loss of S$0.053 million and EBITDA of S$1.285 million in 9M 2020 as compared to S$2.858 million in net profit and S$3.963 million in EBITDA recorded by the Group in 9M 2019. The net loss and lower EBITDA recorded in 9M 2020 are mainly attributable to the flow-down effects of the lower revenue, gross profit margin, other income and higher other losses due to fair value losses on the Group's venture investments.
Detailed Segmental Breakdown of Group Revenue and Gross Profit
The detailed segmental breakdown of the Group’s revenue and gross profit for 9M 2020, together with comparative results for 9M 2019 is provided below:
Table 8.4: Group revenue as analysed by business unit for the nine months ended 30 September
2020
S$'000 |
Sales mix
% |
2019
S$'000 |
Sales mix
% |
|
| Unifiedcomms | 8,679 |
55.1 |
10,135 |
58.6 |
| GlobeOSS | 7,074 |
44.9 |
7,151 |
41.4 |
| Captii Ventures | - |
- |
- |
- |
| Others | - |
- |
- |
- |
| Total | 15,753 |
100.0 |
17,286 |
100.0 |
Unifiedcomms - Segment for content-driven mobile VAS, messaging and signaling systems, solutions and managed services.
GlobeOSS - Segment for mobile network operation support systems, solutions and managed services.
Captii Ventures - Segment for strategic investment in early and late-stage technology ventures.
Others - Segment for operational headquarters of the Group and investment holding.
Table 8.5: Group revenue as analysed by geographical segment for the nine months ended 30 September
| External Sales | 2020
|
|||
Unifiedcomms
S$'000 |
GlobeOSS
S$'000 |
Others
S$'000 |
Group
S$'000 |
|
| South East Asia (SEA) | 7,974 |
7,070 |
- |
15,044 |
| South Asia (SA) | 266 |
- |
- |
266 |
| Middle East & Africa (MEA) | 439 |
- |
- |
439 |
| Others | - |
4 |
- |
4 |
| Total | 8,679 |
7,074 |
- |
15,753 |
| External Sales | 2019
|
|||
Unifiedcomms
S$'000 |
GlobeOSS
S$'000 |
Others
S$'000 |
Group
S$'000 |
|
| SEA | 9,357 |
7,147 |
- |
16,504 |
| SA | 426 |
- |
- |
426 |
| MEA | 352 |
- |
- |
352 |
| Others | - |
4 |
- |
4 |
| Total | 10,135 |
7,151 |
- |
17,286 |
Table 8.6: Group revenue as analysed by contract type for the quarter ended 30 September
| External Sales | 2020
|
2019 |
||||
System Sale(1) |
Managed Service(2) |
Group |
System Sale(1) |
Managed Service(2) |
Group |
|
| Revenue | 4,090 |
11,663 |
15,753 |
6,967 |
10,319 |
17,286 |
| Gross Profit | 2,175 |
5,873 |
8,048 |
3,881 |
5,171 |
9,052 |
| Gross Profit (%) | 53.2% |
50.4% |
51.1% |
55.7% |
50.1% |
52.4% |
(1) System Sale - this refers to contracts that involve the outright purchase by customers of systems comprising the Group's products and technologies, and where these systems are in turn delivered as turnkey solutions. The scope of work for a system sale contract includes system design, implementation, testing and commissioning services.
(2) Managed Service - this refers to contracts that involve the provision of both systems comprising the Group's products and technologies as well as the Group's professional services, on a recurring, revenue sharing, software-as-a-service, pay-per-use or monthly or quarterly fixed and variable fee basis. Also treated as a managed service contract are system maintenance and technical support contracts with existing customers of the Group.
Review of the Group's financial position as at 30 September 2020 as compared to the Group's financial position as at 31 December 2019
Non-cash current assets of the Group decreased from S$14.938 million as at 31 December 2019 to S$12.029 million as at 30 September 2020. This 19.5% decrease in non-cash current assets was mainly due to a decrease in trade and other receivables as a result of lower revenue recorded and collection received.
Total non-current assets of the Group decreased from S$28.913 million as at 31 December 2019 to S$26.666 million as at 30 September 2020 representing a decrease of 7.8%. This decrease was mainly due to a reduction in fair value of S$2.17 million in the Group’s venture investment portfolio recorded as other financial assets. The fair value movements assessed on the Group’s venture investment portfolio, which are unrealised, is a result of changes in estimated fair valuation of the Group’s venture investments as certain investees of the Group's venture investment portfolio were impacted by the CoViD-19 pandemic on both their businesses and capital raising activities.
Total liabilities of the Group decreased from S$8.615 million as at 31 December 2019 to S$6.174 million as at 30 September 2020. This 28.3% decrease in total liabilities is attributable to a decrease in trade and other payables and borrowings, following repayments in the reporting period.
Review of the Group’s cash flow for the quarter and nine months ended 30 September 2020 as compared to the corresponding period ended 30 September 2019
The Group’s net cash flow from operations for Q3 2020 was S$0.859 million, as compared to S$1.381 million for Q3 2019, a decrease of 37.8%. This decrease was primarily due to a unfavourable change in working capital of S$0.181 million for Q3 2020, in contrast with the favourable working capital change of S$0.266 million for Q3 2019, which was due to higher repayment to trade payables.
The Group’s net cash flow from operations for 9M 2020 was S$4.469 million, as compared to S$1.614 million for 9M 2019, an increase of 176.9%. This significant increase was primarily due to a favourable change in working capital of S$1.010 million for 9M 2020, in contrast with the unfavourable working capital change of S$1.883 million for 9M 2019, which was contributed by higher collection from trade receivables.
The Group’s net cash flow used in investing activities for Q3 2020 was S$0.09 million, as compared to S$0.835 million for Q3 2019. The lower net cash used in investing activities was mainly due to the absence of venture investments and lower investment in plant and equipment in Q3 2020, as compared to Q3 2019.
The Group’s net cash flow used in investing activities for 9M 2020 was S$0.463 million, as compared to S$1.116 million for 9M 2019. The lower net cash used in investing activities was mainly due to the lower volume of venture investments made in 9M 2020, as compared to 9M 2019.
The Group’s net cash flow used in financing activities for Q3 2020 was S$0.418 million, as compared to S$0.76 million for Q3 2019. This decrease was mainly due to i) Absence of dividend payout to Non-Controlling Interest in Q3 2020; and ii) Withdrawal of restricted deposits placed as performance bond.
The Group’s net cash flow used in financing activities for 9M 2020 was S$1.244 million, as compared to S$0.962 million for 9M 2019. This increase was mainly due to i) Higher dividend payout to Non-Controlling Interest; and ii) Leases repayment.
Commentary
The CoViD-19 pandemic has resulted in many countries in our Group’s regions of focus continuing to impose movement and travel restrictions. Such restrictions have adversely affected many businesses that are prohibited to trade, or that have been asked to significantly alter the scope of their operations within government-prescribed safety limits. The uncertainty of economic recovery from the shock caused by COVID-19 and the prospect of a protracted economic slowdown globally, especially in the Group’s regions of focus, have weighed on the minds of management and the directors of the Group when considering the outlook for the remainder of financial year.
The impact of CoViD-19 on Unifiedcomms and GlobeOSS has fortunately been minimal in the year to-date. This is because these businesses operate primarily in the field of telecommunications, an essential service in any economy today. In addition, Unifiedcomms and GlobeOSS businesses have been made capable of fully-functioning under a work-from-home mode of operation, well ahead of movement control restrictions or lockdown orders being enforced. The Group’s primary customers in the Unifiedcomms and GlobeOSS businesses are telecommunications network operators and service providers that have continued to operate normally throughout CoViD-19 restrictions, albeit remotely and through digital engagement, rather than face-to-face interaction. Contracts in-hand continue to be progressed and management of the Group are hopeful that new projects and initiatives requiring our products and services, will continue to be pursued by customers in the months ahead. The possibility remains however, that larger system sale contracts that have yet to be committed this year, may be deferred by customers to next year, or even abandoned entirely if macroeconic and industry conditions deteriorate significantly. Some managed service contracts of the Group which are impacted by government restrictions or directives arising from CoViD-19 policy measures, may meanwhile continue to show weaker performance than before.
At Captii Ventures, the Group’ venture investment business, the climate for either business development or funding has become more challenging since the CoViD-19 pandemic set in. As a result, certain investees in the Group's venture investment portfolio have been affected with dampened valuations in the year to-date, culminating in a fair value loss of S$2.17 million being recorded in 9M 2020. If the adverse microeconomic and funding environment persists to the end of the year, other investees in the venture investment portfolio may face difficulty in raising further capital, while those that successfully raise may be faced with further dampened valuations. Management has taken active, early measures to perform impact assessment as well as in assisting investees to plan and manage through a more hostile environment for both business and funding. Investment management activities to assist investees and protect our investments will be the priority at Captii Ventures for the remainder of the year.
Against this negative macroeconomic backdrop for the future, the Group remains optimistic and will continue to work closely with customers and investees, to minimise the negative impact of CoViD-19-related developments on Group financial performance. Management of the Group has in recent months taken an active and measured approach to managing risks to protect the Group’s people and assets, and will sustain these efforts until the pandemic resolves.
Management will further the work it has been doing to strengthen the Group’s managed service contract portfolio and will invest even more selectively in the venture investment business. Demand for internet-driven application services for enterprises, in the broad domain of fintech, as well as in internet and handset-app delivered digital media, have been heightened in the current environment. These areas will continue to be the focus for the Group's venture investment activities, and is expected to complement the organic growth strategies of the Unifiedcomms and GlobeOSS businesses.