Annual Report 2024

09 SUSTAINABILITY REPORT 2024

65 INDEPENDENT AUDITORS' REPORT

74 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

131 STATISTICS OF SHAREHOLDINGS

Dear Shareholders,

On behalf of the Board of Directors (the "Board") of Datapulse Technology Limited (the "Company", together with its subsidiaries, collectively the "Group"), I am pleased to present the Annual Report for the financial year ended 31 July 2024 ("FY2024").

I am glad to report that this year marks a significant turnaround for the Group as we have successfully emerged from a loss-making position. The resilience and dedication of our team have allowed us to navigate the challenges of recent years, particularly those posed by the COVID-19 pandemic, which directly affected our hospitality assets, including our wholly-owned hotel, Travelodge Myeongdong City-Hall ("TLMC") in Seoul, South Korea. We also hold a 15% stake in another hotel investment in Seoul, Travelodge Myeongdong Euljiro ("TLME"), and a 5% stake in Travelodge Harbourfront Singapore ("TLHS").

Nonetheless, we remain committed to protecting shareholder value, as I am the largest shareholder and hold the majority of the stake.

BUSINESS OUTLOOK

The hospitality industry in South Korea has demonstrated promising growth, driven by an increase in international tourism and a rising demand for leisure and travel experiences. Additionally, the domestic market continues to evolve, with local hotel guests increasingly interested in diverse and unique offerings.

However, the Group faces ongoing challenges, including foreign exchange risks, rising labour costs, inflationary pressures, competition from neighbouring countries, and geopolitical uncertainties that may affect South Korea's tourism sector. In response, the Group will maintain its focus on enhancing hotel revenue while actively implementing strategies to manage cost pressures without compromising the quality of services provided to our guests. Furthermore, we are committed to exploring opportunities beyond the hospitality sector to diversify our revenue streams and improve overall returns.

For FY2024, the Group reported increased revenue of $6.2 million compared to $4.5 million in the previous year. We remain in a healthy financial position with minimal bank borrowings and net cash of $14.2 million as at the end of FY2024.

DIVIDEND

Given that the Group has recently emerged from a loss-making position in FY2024, it continues to be mindful of the need to conserve cash to fund its operations and to take advantage of any opportunities that may arise. The Board is not recommending the payment of a dividend for FY2024.

APPRECIATION

On behalf of the Board of Directors, I would also like to extend my sincere appreciation to our directors, our shareholders, business partners, and all our stakeholders for their support. I would also like to thank our management team for their hard work and dedication.

ANG KONG MENG

EXECUTIVE CHAIRMAN AND CEO

FINANCIAL PERFORMANCE

The Group's revenue is contributed by 3 business segments; namely the hotel operations, asset management and investment trading segments.

The Group recorded total revenue of $6.2 million in FY2024. The hotel operations business contributed $6.0 million through the Group's hotel namely Travelodge Myeongdong City-Hall ("TLMC"), while asset management fees and investment income contributed a total of $0.2 million.

Hotel operations revenue increased from $4.1 million in year ended 31 July 2023 ("FY2023") to $6.0 million in FY2024, reflecting a stronger recovery in South Korea's hospitality industry driven by factor such as increase in international tourists subsequent to the relaxation of travel measures. The average daily rate ("ADR") has increased 59% year on year ("yoy"), while revenue per available room ("RevPar") has also increased by 59% compared to FY2023.

Asset management fees were derived from managing a hotel asset. The revenue from asset management fees decreased from $0.35 million in FY2023 to $0.20 million in FY2024 primarily attributed to the expiration of the asset management agreement on 31 December 2023.

Revenue from investments increased from $0.05 million in FY2023 to $0.07 million in FY2024, attributed to dividend income and gains from disposal of investments in debt and equity securities.

The increase in other income from $0.3 million in FY2023 to $0.4 million in FY2024 was mainly due to higher interest income earned from fixed deposits.

Staff costs remained at $1.5 million for both FY2024 and FY2023.

The increase in hotel operation expenses from $2.0 million in FY2023 to $2.5 million in FY2024 was mainly due to higher hotel operating activities, which corresponded with the increase in hotel operations revenue for FY2024.

The depreciation charge primarily arose from the Group's freehold building and associated renovation works. Depreciation remained at $0.6 million for both FY2024 and FY2023.

The decrease in finance cost was mainly due to the monthly repayment of bank loans.

The reversal of impairment of freehold building of $2.9 million in FY2024, compared to impairment loss of $0.9 million in FY2023 is primarily attributed to a favorable independent valuation of the freehold building.

The increase in other operating expenses from $1.0 million in FY2023 to $1.2 million in FY2024 was mainly due to the increase in professional and compliance fees.

The increase in tax credits from $0.2 million to $0.9 million was mainly due to the reversal of a $0.5 million income tax provision for the prior year as the obligation had lapsed, and recognition of $0.4 million in deferred tax assets resulting from previously unrecognized tax losses.

Based on the above, the Group's profit attributable to owner of the Company was $4.5 million in FY2024 as compared to a loss of $1.2 million in FY2023.

Review of Financial Position

The property, plant and equipment increase from $37.9 million as at 31 July 2023 to $38.1 million as at 31 July 2024 due to foreign exchange movement arising from the appreciation of SGD against KRW, reversal of impairment of freehold building and depreciation charged during the year.

Rights of use assets of $0.1 million as at 31 July 2024 mainly relates to the Singapore's office lease.

Long-term investment securities consist of a 15% minority interest in a hotel in Seoul, South Korea and a 5% minority interest in a hotel in Singapore. The increase from $4.2 million as at 31 July 2023 to $4.3 million as at 31 July 2024 was mainly due to additional investment, which were partially offset by adjustments for fair value changes in the investments.

Long-term receivables of $6.3 million as at 31 July 2024 pertain to shareholder loans extended to two investee companies, in which the Group holds a 15% interest and 5% interest, respectively.

The decrease in current trade and other receivables from $0.3 million as at 31 July 2023 to $0.2 million as at 31 July 2024 was mainly due to timing of receipts for trade receivables and maturing fixed deposits placed with banks.

Short-term investment securities relate to quoted investments held for trading and carried at fair value through profit or loss. The decrease from $0.5 million as at 31 July 2023 to $nil as at 31 July 2024 was mainly due to the disposal of these quoted investments during the year.

The decrease in share capital from $35.0 million as at 31 July 2023 to $34.7 million as at 31 July 2024 was attributable to the purchase and cancellation of ordinary shares during the year.

The decrease in trade and other payables from $0.8 million as at 31 July 2023 to $0.7 million as at 31 July 2024 was mainly due to payments made during the year.

The decrease in loan and borrowing was mainly due to the monthly principal repayments during the year.

Review of Cash Flow

Net cash generated from operating activities of $1.4 million for FY2024, was in line with the operating profit and the proceeds from the disposal of quoted investments during the year.

Net cash generated from investing activities of $0.4 million for FY2024, resulted from interest received on fixed deposits. This was partially offset by a capital injection into an investee company where the Group holds a minority interest and the purchase of plant and equipment.

Net cash used in financing activities of $0.9 million for FY2024, resulted from shares buy back, the repayment of bank loans and lease liabilities.

As a result of the above, the Group's cash and bank balances increased from $13.4 million as at 31 July 2023 to $14.2 million as at 31 July 2024.