SINGAPORE (Dec 16): Lifebrandz reported losses for 1Q ended Oct widened to $1.06 million from $0.53 million a year ago on higher total expenses as a result of business expansion.
Revenue more than doubled to $1.14 million mainly due to revenue contribution from subsidiary, e-Holidays Co, which accounted for approximately 73% of the group revenue.
Revenue from the F&B segment was contributed by two F&B outlets, which are Mulligans Pattaya and Hashida Sushi.
However, total expenses more than doubled to $2.3 million as a result of increased operating costs and related employee expenses, which was directly attributed to higher sales activities and business expansion.
Separately, LifeBrandz announced it is undertaking a rights issue to raise $1.5 million to finance the expansion of its F&B business and for working capital purposes.
In particular, it wants to use $0.9 million to fund the opening of the second new Hashida Sushi restaurant in San Francisco by the first quarter of 2019 as well as two more new Hashida Sushi restaurants in the near future.
LifeBrandz is selling up to approximately 325.9 million new shares at 0.7 cent each on the basis of one rights share for every two existing shares held by shareholders.
The rights issue price represents a discount of 46.2% to its Friday closing price of 1.3 cents.
Assuming maximum subscription, the rights issue will raise net proceeds of $2.18 million, after deducting the professional fees and related expenses of about $0.1 million.
The rights shares will also represent about 33.3% of LifeBrandz’s enlarged share capital.
Meanwhile, LifeBrandz also announced adjustments to the existing warrants announced last January.
Holders of its existing 195.1 million warrants will now receive an additional 0.1404 warrant for every one existing warrant held.
The exercise price of each existing warrant will be reduced to 3.5 cents from 4 cents.
Each additional warrant will carry the right to subscribe for one additional share.
The actual additional warrants to be issued will depend on the number of existing warrants accepted under the rights issue.
Upon the exercise of the additional warrants, LifeBrandz could issue up to 27.4 million additional new shares.
