Aussino

Aussino widened its losses to $13.2m in FY12 from $5.3m the previous year on a 10% drop in revenue due to higher rental and labour costs, which rendered its stores in China unprofitable. The group closed more than 20 stores and cunters in China and ended its retail operations in HK and Korea, as well as incurred a $1.4m goodwill impairment charge for its ladies fashion business in Australia. Moving ahead, it will be adapting its business strategy to focus on distributorship and group sales in China. As of Jun 12, NAV stands at 2.8¢ per share, a sharp drop from 7.4¢ in FY11. However, there is no relevance in looking at past Aussino’s performance anymore as the company is disposing its existing business to its parent and acquiring the energy business unit of Max Myanmar (owned by U Zaw Zaw) via a reverse takeover for $70m. Max Myanmar currently operates 21 petrol kiosks stations across key cities in Myanmar, storage facilities and an oil trading business and reported a $5.2m profit in FY12. Bear in mind that the proposed acquisition and RTO deal is still in progress pending approvals from shareholders and SGX and U Zaw Zaw is on the US sanctions list.