Interim Report Released for six months ended 31 Dec 2019

CSM Group Limited

Interim Financial Report

For the six months ended 31 December 2018

CSM Group Limited
Interim Financial Report
For the six months ended 31 December 2018



2
Contents

Directors’ Report 3
Statement of Comprehensive Income 5
Statement of Changes in Equity 6
Statement of Financial Position 7
Statement of Cash Flows 8
Notes to the Financial Statements 9
Company Directory 14

CSM Group Limited
Directors’ Report
For the six months ended 31 December 2018



3

Dear Shareholders

Following the decision to cease operations of its wholly owned subsidiary China Scrap Metal Resources Pty
Ltd (“CSM Pty”), CSM Group Limited (the “Company”) has now completed the winding down of that
business and its subsidiary company (CSM Pty) was de-registered on 6 November 2018.

The financial results reflect the decision to minimise costs, wind down and exit the Australian operation.

As cash has been realised from the sale of inventory, property, plant and equipment, and local liabilities
satisfied, surplus funds have been transferred to the parent company, CSM Group. All funds that were held
in Australia are now held in CSM Group.

Transfer from foreign currency translation reserve on wind up of subsidiary
Included in the net loss attributable to shareholders is a classification adjustment of $697,000. Accounting
standards require that on the wind up of a foreign subsidiary, the cumulative amount of exchange
differences recognised in equity (in the foreign currency translation reserve) be reclassified from equity to
profit or loss. This adjustment has no impact on net tangible asset backing or cash reserves. Further details
are provided in the notes to the financial statements.

Functional Currency
The Company advised in its 2018 Annual Report that the functional currency changed from USD to NZD
with effect from 1st April 2018.

Presentation Currency
Now that the Australian subsidiary, CSM Pty, has been fully disposed and the corporate entity de-registered
the Directors advise that the Company has adopted New Zealand Dollars as its presentation currency.
Details about the impact of the change in presentation currency are set out in the notes to the financial
statements.

Future Options
The Company is now a listed shell, with considerable cash resources and no debt. The Company has no
term liabilities, and will have limited ongoing liabilities, most of which are associated with maintaining a
listing on the NZAX market.

The options the directors are pursuing for CSM Group include:
• finding a business operation to invest in;
• undertaking a reverse listing of a business seeking a stock exchange listing.

At this time the Company has no particular announcement to make regarding progress with those options
suffice to say they are being actively developed.

CSM Group Limited
Directors’ Report
For the six months ended 31 December 2018



4

Result
The financial result for the Group for the six months ended 31st December 2018 is a loss of NZD
$1,022,000.


Dated: 26 April 2019



Director Director

CSM Group Limited
Statement of Comprehensive Income
For the six months ended 31 December 2018


These interim financial statements have not been audited, nor reviewed by the auditor. The accompanying notes
form part of these interim financial statements and should be read in conjunction with them.


5




6 mths ended6 mths ended
31 Dec 201831 Dec 2017
(unaudited)(restated)
Note
NZ$'000NZ$'000
Revenue--
Other income--
Administrative expenses1(323)(306)
Operating loss(323)(306)
Finance income1511
Exchange loss(82)(48)
Loss before income tax(390)(342)
Income tax expense--
Loss from continuing operations
(390)(342)
Discontinued operations
Gain (loss) from discontinued operations (net of tax)266(58)
Transfer from foreign currency translation reserve on wind up of subsidiary(697)-
Net loss attributable to shareholders(1,022)(400)
Other comprehensive income
Items that may be reclassified subsequently to profit of loss
Exchange differences on translation of overseas subsidiaries-2
Exchange difference on change in presentation currency-107
Other comprehensive income for the period, net of tax-109
Total comprehensive loss for the year attributable to shareholders(1,022)(291)
Total comprehensive loss for the year attributable to shareholders
Continuing operations(390)(233)
Discontinued operations(631)(58)
(1,022)(291)
Earnings (loss) per share from continuing operations:
- basic and diluted loss per share (cents)3(0.094)(0.056)
Earnings (loss) per share from continuing and discontinued operations:
- basic and diluted loss per share (cents)3(0.246)(0.070)

CSM Group Limited
Statement of Changes in Equity
For the six months ended 31 December 2018


These interim financial statements have not been audited, nor reviewed by the auditor. The accompanying notes
form part of these interim financial statements and should be read in conjunction with them.


6






Share ForeignAccumulatedTotal
capitalcurrencylossesequity
translation
reserve
NZ$'000NZ$'000NZ$'000NZ$'000
Balance at 1 July 2018 (restated)44,919(697)(41,578)2,644
Loss attributable to shareholders-697(1,022)(325)
Exchange differences on translating overseas operations ----
Exchange differences on change in presentation currency----
Other comprehensive income----
Total comprehensive loss for the period-697(1,022)(325)
Balance at 31 December 2018 (unaudited)44,919-(42,600)2,319
Balance at 1 July 2017 (restated)44,165(647)(40,125)3,393
Loss attributable to shareholders--(400)(400)
Foreign currency translation-1-1
Exchange differences on change in presentation currency1,425(21)(1,297)107
Other comprehensive income----
Total comprehensive loss for the period1,425(19)(1,697)(291)
Balance at 31 December 2017 (restated)45,590(667)(41,822)3,102

CSM Group Limited
Statement of Financial Position
As at 31 December 2018


These interim financial statements have not been audited, nor reviewed by the auditor. The accompanying notes
form part of these interim financial statements and should be read in conjunction with them.


7



For and on behalf of the Board:

Director Director

Dated: 26 April 2019

31 Dec 201830 Jun 201830 Jun 2017
(unaudited)(restated)(restated)
Note
NZ$'000NZ$'000NZ$'000
ASSETS
Current assets
Cash and cash equivalents2,1352,4522,676
Trade and other receivables51120132
Inventory--311
Taxation receivable234246238
Total current assets2,4202,8183,357
Non-current assets
Property, plant and equipment 475
Total non-current assets--475
Total assets2,4202,8183,832
LIABILITIES
Current liabilities
Trade payables and other liabilities100174439
Total current liabilities100174439
Total liabilities100174439
Net assets
2,3192,6443,393
EQUITY
Share capital44,91944,91944,165
Foreign currency translation reserve-(697)(647)
Accumulated losses(42,600)(41,578)(40,125)
Total equity
2,3192,6443,393
Net tangible assets per share (cents per share):40.56 0.64

CSM Group Limited
Statement of Cash Flows
For the six months ended 31 December 2018


These interim financial statements have not been audited, nor reviewed by the auditor. The accompanying notes
form part of these interim financial statements and should be read in conjunction with them.


8







6 mths ended6 mths ended
31 Dec 201831 Dec 2017
(unaudited)(restated)
NoteNZ$'000NZ$'000
Cash flows from operating activities
Receipts of loan receivables
--
Receipts from customers
-582
interest received
1514
Payments to suppliers and employees
(289)(853)
Income tax refunded (paid)
40(3)
Net cash outflows from operating activities
6
(235)(261)
Cash flow from investing activities
Disposal of property, plan and equipment
-508
Income taxes paid--
Net cash inflows (outflows) from investing activities-508
Net increase/(decrease) in cash and cash equivalents(235)247
Cash and cash equivalents at the beginning of the period2,4522,676
Effect of exchange rate changes(82)81
Cash and cash equivalents at the end of the period
2,1353,005

CSM Group Limited
Condensed Notes to the Interim Financial Statements
For the six months ended 31 December 2018

9
A General Information
These unaudited interim financial statements are for CSM Group Limited (the Company) and its
subsidiary, China Scrap Metal Resources Pty Limited (CSM Pty) (together, the Group). The results of
CSM Pty are included until the date of its voluntary liquidation on 6 November 2018.

The Group was engaged in a business operation in Australia of processing scrap metals for export sale to
Chinese markets. The Company made the decision to cease the scrap metal operations of CSM Pty
during the year ended 30 June 2017 and CSM Pty was subsequently voluntarily wound up.

CSM Group Limited, is a limited liability company incorporated and domiciled in New Zealand. The
address of its registered office is 44a Orakei Road, Remuera, Auckland 1050.

There are no seasonal or cyclical influences on these interim results.

B Summary of Significant Accounting Policies

Basis of preparation
These unaudited interim financial statements for the six months ended 31 December 2018 have been
prepared in accordance New Zealand Generally Accepted Accounting Practice (“NZ GAAP”), with
New Zealand Equivalent to International Accounting Standard 34: Interim Financial Reporting (“NZ IAS
34”) and International Accounting Standard 34: Interim Financial Reporting (“IAS 34”).and with the
requirements of the Financial Markets Conduct Act 2013 and the NZAX Listing Rules. These unaudited
interim financial statements do not include all of the notes of the type normally included in an annual
financial report. Accordingly, this report should be read in conjunction with the financial statements
included in the annual report for the year ended 30 June 2018 which have been prepared in accordance
with New Zealand equivalents to International Financial Reporting Standards (“NZ IFRS”) and
International Financial Reporting Standards (“IFRS”).

The financial statements are presented in New Zealand dollars rounded, where necessary, to the nearest
thousand dollars.

The interim financial statements are unaudited.

Accounting Standards
Apart from the change in presentation currency noted below, the accounting policies have been applied on
a basis consistent with those used in the audited financial statements for the year ended 30 June 2018.
Those accounting policies are set out in the 2018 Annual Report.

Change in Presentation Currency
The Company advised in its 2018 Annual Report that the functional currency changed from USD to NZD
with effect from 1st April 2018.

Now that the Australian subsidiary, CSM Pty, has been fully disposed and the corporate entity de-
registered the Directors advise that the Company has adopted New Zealand dollars as its presentation
currency.

The choice of presentation currency is an accounting policy and any change is applied retrospectively.
The effect is the financial statements are treated as if the new presentation currency has always been the
presentation currency, with the comparatives restated in the new presentation currency.

IAS 1: Presentation of Financial Statements requires the financial statements to include a Statement of
Financial Position as at the beginning of the preceding period when an accounting policy has been applied
retrospectively, as has been the case with this change in accounting policy. The Statement of Financial
Position therefore includes the restated comparatives as at 30 June 2017.

CSM Group Limited
Condensed Notes to the Interim Financial Statements
For the six months ended 31 December 2018

10

For the comparative period from 1 July 2017 through to 1 April 2018 the Company’s functional currency
was USD while the new presentation currency is NZD. The comparatives in the financial statements have
therefore been restated into NZD. Items in the Statement of Financial Position are translated using the
NZD/USD exchange rate at the applicable balance date. Items in the Statement of Comprehensive
Income and the Statement of Cash Flows are translated using the average exchange rate during the
applicable period. On translation into the presentation currency, the effect on equity of foreign currency
movements between the opening and closing dates of the comparative period is shown in Other
Comprehensive Income and in the Statement of Movements in Equity as exchange differences in change
of presentation currency. This adjustment has no impact on net assets or cash reserves.

From 1 April 2018 the Company’s functional currency and presentation currency were both NZD and from
this date there were no further exchange variances relating to the change of presentation currency.

Transfer from foreign currency translation reserve on wind up of subsidiary
Included in the net loss attributable to shareholders is a classification adjustment of $697,000. Whilst
operations at CSM Pty ceased in the prior year, legal de-registration of CSM Pty took place on
6 November 2018. The accounting standards require that upon liquidation of a foreign subsidiary, which is
the legal de-registration of CSM Pty, the cumulative amount of exchange differences recognised in equity
(in the foreign currency translation reserve) be reclassified from equity to profit or loss. This adjustment
has no impact on net tangible asset backing or cash reserves.

Going concern
Prior to its voluntarily liquidated, CSM Pty’s surplus cash was repatriated to the Company and is held on
deposit.

The Company is now a listed shell, with cash resources and no debt. The Company has limited financial
obligations and these are composed largely of costs associated with maintaining a listing on the NZAX.

In adopting the going concern basis of accounting, the Directors have considered that the Company has
sufficient cash funds to continue operations through the next 12 months and in several accounting periods
at the current and expected cash burn rate without recourse to shareholders or external funding.

There are several options for the Company and these will be investigated and discussed with
the shareholders at the appropriate time. These options include realistic alternatives of the business
finding another operation to invest in or a reverse listing of a company seeking a stock exchange listing or
following a special resolution of shareholders the Company could also be voluntarily wound up and the net
proceeds, post liquidation, returned to the shareholders. No decisions on these options or any others have
been made and they will follow discussions with shareholders.

At the date of these financial statements, the Directors have not made the decision to liquidate the
Company.

Having considered all the factors for the Company, in balance, the Directors have adopted the going
concern basis in preparing the financial statements. These financial statements do not include any
adjustments that would result if the Company was unable to continue as going concern.


These unaudited interim financial statements have been approved for issue by the Board of Directors on
26 April 2019.

CSM Group Limited
Condensed Notes to the Interim Financial Statements
For the six months ended 31 December 2018

11
1 Administrative expenses


2 Gain from discontinued operations
The gain from discontinued operations includes the release of a $50,000 accrual relating to premises
costs.

3 Earnings per share




At 31 December 2018, there were no financial instruments that carried any shareholder dilution rights that
were considered to be dilutive (31 December 2017: none).
6 mths ended6 mths ended
31 Dec 201831 Dec 2017
(unaudited)(unaudited)
NZD$'000NZD$'000
Directors fees(182)(179)
Audit costs(64)(25)
Other expenses(78)(102)
(323)(306)
6 mths ended6 mths ended
31 Dec 201831 Dec 2017
(unaudited)(restated)
Basic earnings/(loss) per share (NZ cents):
From continuing operations(0.094)(0.057)
From discontinued operations(0.152)(0.014)
Total basic earnings/(loss) per share(0.246)(0.070)
Diluted earnings/(loss) per share (NZ cents):
From continuing operations(0.094)(0.057)
From discontinued operations(0.152)(0.014)
Total diluted earnings/(loss) per share(0.246)(0.070)
6 mths ended6 mths ended
31 Dec 201831 Dec 2017
Loss from continuing operations (NZ$)(390,317)(234,773)
Loss from discontinued operations (NZ$)(631,489)(56,542)
(1,021,805)(291,315)
414,550,000414,550,000
The losses and weighted average number of ordinary shares used in the calculation of loss
per share are as follows:
Weighted average number of ordinary shares used in the
calculation of basic and diluted earnings per share

CSM Group Limited
Condensed Notes to the Interim Financial Statements
For the six months ended 31 December 2018

12
4 Net tangible asset backing



5 Segment information
The Group has identified its operating segments based on the internal reports reviewed and used by the
Board of Directors in assessing performance and in determining the allocation of resources. The Group
was organised into the following main operating segments:
• CSM Pty - includes the previous business operation in Australia involved in the processing of scrap
metal for export sale to Chinese markets.
• Holding company NZ - includes holding company costs and head office charges.
Revenue has been allocated based on the country where the sale is generated. Expenses are allocated
based on the country where the expense is incurred.
Total assets and liabilities are allocated based upon the location of the reporting entity to which they
relate.






31 Dec 201830 Jun 2018
(unaudited)(restated)
Net tangible assets (NZ$)2,319,396 2,644,135
Issued shares at balance date414,550,000 414,550,000
Net tangible asses per share (NZ cents)0.56 0.64
HoldingCSM PtyTotalHoldingCSM PtyTotal
Company NZCompany NZ
(unaudited)(unaudited)(unaudited)(restated)(restated)(restated)
NZ$'000NZ$'000NZ$'000NZ$'000NZ$'000NZ$'000
Total inter-segment revenue------
Total external revenue----554-
Total EBITDA(323)11(312)(306)(154)306
Finance income15-1511211
Impairment reduction---(48)73(48)
-5454---
-(697)(697)---
Exchange gain/(loss)(82)-(82)-20-
Net loss for the period(390)(631)(1,022)(342)(58)(400)
Six month period ended 31 December Six month period ended 31 December 2017
Gain (loss) from discontinued operations
(net of tax)
Transfer from foreign currency translation
reserve on wind up of subsidiary
HoldingCSM LtdTotalHoldingCSM LtdTotal
Company NZAustralianCompany NZAustralian
(unaudited)(unaudited)(unaudited)(restated)(restated)(restated)
NZ$'000NZ$'000NZ$'000NZ$'000NZ$'000NZ$'000
Total segment assets2,420-2,4202,798 19 2,818
Total segment liabilities100-100119 54 174
31 December 201830 June 2018

CSM Group Limited
Condensed Notes to the Interim Financial Statements
For the six months ended 31 December 2018

13
6 Reconciliation of loss after taxation with cash flow from operating activities




7 Subsidiaries
On 6 November 2018 CSM Group Limited’s 100% owned subsidiary, CSM Pty Limited, was voluntarily
liquidated. CSM Group Limited has no other subsidiaries.

8 Contingent liabilities
There are no contingent liabilities as at 31 December 2018 (30 June 2018: nil).

9 Commitments
The Group had no commitments for future capital expenditure as at 31 December 2018 (30 June 2018:
nil).

10 Events subsequent to interim balance date
There have been no significant events after balance date.

6 mths ended
6 mths ended
31 Dec 2018
31 Dec 2017
(unaudited)
(unaudited)
NZD$'000
NZD$'000
Net loss after taxation
(1,022)
(400)
Adjustments for:
Income tax expense (benefit) in profit or loss
-
-
Impairment reduction
-
(20)
Effect of foreign exchange rates
82
34
Transfer from foreign currency translation reserve on wind up of subsidiary
697
-
Other non-cash adjustments
-
(21)
Movements in working capital
Decrease / (increase) in trade and other receivables
42
69
Decrease / (increase) in inventories
-
321
Decrease / (increase) in trade and other payables
(73)
(241)
Income taxes received (paid)
40
(3)
Net cash outflows from operating activities
(235)
(261)

CSM Group Limited
Company Directory


14


Directors
R Gower
S Joyce
P Li
Z Shi

Registered Office
c/- Roger Gower & Associates
44A Orakei Road, Remuera 1050
New Zealand

Postal Address
c/- Roger Gower & Associates
44A Orakei Road, Remuera 1050
New Zealand

Bankers
ASB Bank Limited
PO Box 35
Shortland Street
Auckland 1140

Auditor
PricewaterhouseCoopers
188 Quay Street
Auckland
New Zealand

Share Registry
Link Market Services
Level 11, Deloitte Centre
80 Queen Street
Auckland 1010

PO Box 91976
Auckland 1142
New Zealand