Unless otherwise stated, the abbreviations and definitions used throughout this Announcement shall have the same meanings as those previously defined in the Company’s Announcement dated 21 June 2023 (Reference Number: GA1-20062023-00025) in relation to the Disposal (“Announcement1”).

Further to the Announcement1, the Board wishes to provide the following additional information on the Disposal:

1.            Detailed Basis and Justification for the Disposal Consideration

The Disposal Consideration of RM17,597,330.00 was determined at a willing buyer-willing seller basis after arm’s length negotiations by reference to the unaudited net assets (“NA”) of SBG Group as at 30 April 2023 amounting to RM58,657,764.08.

The Board also compared the price-to-earnings multiple (“PE multiple”) of SBG Group with that of the Company and other selected comparable companies which are currently listed on Bursa Securities under ‘Consumer Products and Services’ sector and are principally engaged in the marketing and distribution of fashionable products such as bags, footwear and accessories (collectively, “Comparable Companies”). The other selected Comparable Companies are Padini Holdings Berhad, MESB Berhad and Carlo Rino Group Berhad. The following was noted by the Board:

(i)  the PE Multiple of SBG Group is 9.52 times (computed based on SBG Group’s net profit attributable to owners of the Company (“PATAMI”) for the trailing 12-month period ended 31 March 2023);

(ii)  the PE Multiple of Bonia is 6.88 times and the range of PE Multiple of Comparable Companies is 6.06 times to 15.66 times (computed based on PATAMI of respective companies for the trailing 12-month period ended 31 March 2023 or 31 December 2022, where applicable); and

(iii)  the median PE Multiple of Comparable Companies is 8.79 times.

Hence, the Disposal Consideration which is equivalent to 30% of the unaudited NA of SBG Group as at 30 April 2023 was concluded at premium of PE Multiple of Bonia and median of range of PE Multiple of Comparable Companies, respectively.

2.            Intended application of the Sale Proceeds

The sale proceeds of RM17,597,330.00 from the Disposal will be utilised in the following manner:

The renovation cost relates to the opening of new BONIA and Braun Buffel boutiques at selected prime location.

The general corporate and working capital requirements of the Group includes, but not limited to, day-to-day operating expenses, advertisement and marketing expenses and purchase of inventories in relation to the Group’s business. The breakdown given above is in line with the growth strategy of the Group. The actual amount to be utilised by each component may differ subject to the operating requirements at the time of utilisation.

Pending utilisation, the proceeds received will be placed in interest-bearing deposits with financial institutions to earn interest income.

This Announcement is dated 23 June 2023.