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TRIO INDUSTRIAL ELECTRONICS GROUP LIMITED
致豐工業電子集團有限公司
(Incorporated in Hong Kong with limited liability)
(Stock Code: 1710)
CHANGE IN USE OF PROCEEDS FROM THE LISTING
References are made to the prospectus of Trio Industrial Electronics Group Limited (the "Company", together with its subsidiaries, the "Group") dated 13 November 2017 (the "Prospectus") in relation to the listing of the shares of the Company on the Main Board of The Stock Exchange of Hong Kong Limited (the "Listing"), and the interim report of the Company for the six months ended 30 June 2019 dated 26 August 2019 (the "2019 Interim Report"). Unless otherwise defined, capitalised terms used in this announcement shall have the same meanings as those defined in the Prospectus and the 2019 Interim Report.
The board (the "Board") of directors (the "Directors") would like to announce that the Board has resolved to change the use of net proceeds from the Listing.
USE OF PROCEEDS
The actual net proceeds from the Listing, after deducting the listing-related expenses, were HK$110.0 million (the "Net Proceeds").
It was disclosed in the section headed "Future Plans and Use of Proceeds" in the Prospectus that the Company intended to use the Net Proceeds (or adjusted on a pro-rata basis according to the Net Proceeds) for the following purposes:
- approximately HK$81.7 million (or approximately 74.8% of the Net Proceeds) will be used to further enhance the production efficiency and expand the production capacity, including the development of a new production base and the upgrading of existing production facilities;
- approximately HK$11.2 million (or approximately 10.3% of the Net Proceeds) will be used to establish offices in Dublin, Ireland and Paris, France;
- approximately HK$11.2 million (or approximately 10.3% of the Net Proceeds) will be used to establish the strategic talent centre (the "STC") in Guangzhou City, Guangdong Province, the People's Republic of China (the "PRC") and to recruit high calibre personnel such as engineers, IT technicians, procurement specialists, accountants and internal auditors; and
- the balance to be used for working capital and other general corporate purposes.
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As at the date of this announcement, the Net Proceeds utilised were as follows:
Planned use of | Amount | Remaining | |||
the Net Proceeds | utilised up to | balance as at | |||
as stated in | the date of this | the date of this | |||
the Prospectus | announcement | announcement | |||
HK$'million | HK$'million | HK$'million | |||
Development of new production base | 77.8 | 20.8 | 57.0 | ||
Upgrading of existing production facilities | 4.5 | 4.1 | 0.4 | ||
Establishment of offices in Dublin, | |||||
Ireland and Paris, France | 11.3 | 3.0 | 8.3 | ||
Establishment of the STC in Guangzhou City, | |||||
Guangdong Province, the PRC | 11.3 | 2.6 | 8.7 | ||
Working capital and other general corporate | |||||
purposes | 5.1 | 5.1 | - | ||
110.0 | 35.6 | 74.4 | |||
CHANGE IN USE OF PROCEEDS
The Group has already utilised part of the Net Proceeds to establish offices in Dublin, Ireland and the STC in the PRC. As disclosed in the 2019 Interim Report, the Company has decided to stabilise its business operations in Ireland and Germany and defer the establishment of an office in Paris, France. Nevertheless, the Group sees the need to pursue many more important developments in the areas of procurement, production and assembly, warehousing and after sales services to serve the customers in Europe. This is consistent with the Group's business strategy as stated in the Prospectus to continue expanding our customer base in this region. Hence, the Board has resolved to change the use of approximately HK$13.3 million (see table below) of the remaining unutilised Net Proceeds for business developments and operations in Europe, including but not limited to payments of staff costs, rent, utility expenses, purchase of machineries and equipment. The proposed change of use of the unutilised Net Proceeds (the "Proposed Change") is summarised as follows:
Planned use of | Amount | Remaining | Revised | |||||
the Net Proceeds | utilised up to | balance as at | allocation of | |||||
as stated in | the date of this | the date of this | unutilised | |||||
the Prospectus | announcement | announcement | Net Proceeds | |||||
HK$'million | HK$'million | HK$'million | HK$'million | |||||
Development of new production base | 77.8 | 20.8 | 57.0 | 57.0 | ||||
Upgrading of existing production | ||||||||
facilities | 4.5 | 4.1 | 0.4 | 0.4 | ||||
Establishment of offices in Dublin, | ||||||||
Ireland and Paris, France | 11.3 | 3.0 | 8.3 | - | ||||
Establishment of the STC in | ||||||||
Guangzhou City, Guangdong | ||||||||
Province, the PRC | 11.3 | 2.6 | 8.7 | 3.7 | ||||
Working capital and other | ||||||||
general corporate purposes | 5.1 | 5.1 | - | - | ||||
Business developments and | ||||||||
operations in Europe | - | - | - | 13.3 | ||||
110.0 | 35.6 | 74.4 | 74.4 | |||||
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The Board considers that the Proposed Change is in line with the current business development of the Group and allows the Group to deploy its financial resources more effectively and is hence in the interests of the Company and its shareholders as a whole.
By order of the Board
Trio Industrial Electronics Group Limited
Lai Yiu Wah
Chairman and executive Director
Hong Kong, 25 October 2019
As at the date of this announcement, the Board comprises Mr. Lai Yiu Wah, Mr. Tai Leung Lam, Mr. Joseph Mac Carthy and Mr. Georges René Gener as executive Directors, Mr. Fung Chun Chung, Mr. Cheung Kin Wing and Mr. Wong Raymond Fook Lam as independent non-executive Directors.
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