Dale Capital Group Limited (DCPL.mu) Q32022 Interim Report
The Directors highlight that the Quarterly Results for the Dale Capital Group for the quarter ending February 2022 should take the following key facts into account:
(1) In the past 5 years the group implemented a Prime Strategy of focusing in on the Mauritius Food and Food Security Sector.
(2) The nature of these investments was “early stage” or “venture capital” projects.
(3) The Corona-Virus Pandemic, and its consequences forced Mauritius into closing its borders in February /March 2020 and this lockdown was terminated in February 2022.
(4) The impact of the lockdown severely impacted all the group’s investments, resulting in mothballing/temporarily closing all operations.
(5) In November 2020, the board decided to change its investment strategy and commence with a significant process of transition and re-engineering which process its planned for completion between September 2022 and December 2022.
(6) This transition resulted in commentary in announcements published with the Audited Results for the year ending February 2021 and subsequent Cautionary announcements made during 2022, including:
a. “That its majority owned subsidiary, St. Felix Brands Limited (the company) has entered into a management agreement with Maxima 5 Capital Partners (Mauritius) Limited (the “Manager”) to provide management services for its subsidiaries, including an intent to acquire a majority equity ownership in the company and subsidiaries.”
b. The directors have deemed it appropriate and advisable to change the financial year end of Dale from 28 February to 30 June.
(7) The directors wish to confirm that the transaction to exit as majority owner of these investments has been finalized, subject to certain conditions precedent (CP’s). The effective date of the transaction is 1st July 2022 with CP completion deadlines being 15th July 2022.
(8) The board has previously announced that the Financial Year End for the Company has been changed to 30th June and the Audited results for the period 1st March 2021 to 30th June 2022, together with the annual report will be published by 30th September 2022.
(9) Further announcements will be made after 17th July 2022, to further comment on the Group’s new strategy and transition, which as has been previously stated, will continue as a Private Equity Investment Holding Group including a new sector of Fintech.
(10) Directors Commentary on Results
a. Profit for the Quarter to February 2022 ($1 307 322) (Primarily due to the sale of asset $1 270 261 ) (The said investment was impaired by a similar amount earlier in the financial year)
b. Loss for the 12 months to February 2022. (- $761 875)
(The profit & loss account is in line with director forecasts in the light of the inactivity in trading in subsidiaries and significant holding costs, in spite of low levels of revenue.) (60% reduction in revenue to previous 12 months)
c. Total Assets for the 12 months ending February 2022 $ 6 383 626 (2021 $ 8 999 225) (sale of significant asset at a loss of approx. $2.4m)
d. Total Equity in February 2022 ($ 4 319 513) (2021 $ 6 796 945) (as per (10)c. above
Whilst management have been successful in significantly reducing operating expenses (for the company by approximately 70%) across the group, lack of revenue due to mothballing of operations, coupled with high-level of holding costs has severely and adversely impacted the group.
Illiquidity and inability to raise new capital resulted in sale of assets at the worst possible time, and loss on sale of assets amounted to $2.5m A concomitant benefit however has seen a reduction in institutional debt which effects will be reflected in the results to June 2022.
The Directors inform shareholders and the public that the previous cautionary statements are extended until further notice.