Annual Report 2011 - Food Junction

92
Notes to the Financial Statements (cont’d)
31 December 2011
28. Capital management
The primary objective of the Group’s capital management is to ensure that it maintains a strong credit
rating and healthy capital ratios in order to support its business and maximise shareholder value.
The Group manages its capital structure from various sources of funds to finance its overall operations
and support its business growth. No changes were made in the objectives during the year ended 31
December 2011 and period ended 31 December 2010.
The Group monitors capital using return on equity. Return on equity is derived using profit for the
financial year attributable to owners of the parent over the equity attributable to owners of the
Company. Equity comprises issued capital (net of Treasury shares), accumulated profits and translation
reserve. The return on equity for the period ended 31 December 2011 is 2.7% (2010: 8.5%).
29. Events occurring after the reporting period
(a) Arbitration against China Pub Food and Beverage Management Co., Ltd
Annual Report
The Company’s wholly owned subsidiary companies, Maibo Restaurant Management (Shanghai)
Co., Limited and Malone’s Limited (collectively, the “Claimants”) had on 30 June 2011, applied
(the “Application”) to China International Economic Trade Arbitration Commission (“CIETAC”),
Shanghai Sub-Commission in the People’s Republic of China for arbitration of a claim against
China Pub Food and Beverage Management Co., Ltd (the “Respondent”) for an aggregate sum of
approximately RMB 4.78 million for the following:
(a) Breach of (i) a General (Area Developer) Licence and Management Agreement; (ii) a Unit
Licence and Management Agreement; and (iii) a Trademark Licence Agreement dated 12
September 2007 and supplemental agreements in relation thereto dated 17 September
2008; and
(b) Breach of intellectual property rights of the Claimants.
The arbitration is still ongoing as at 15 March 2012.
(b) Incorporation of new subsidiary companies
The Company has incorporated the following subsidiary companies as part of its ongoing
business development.
(i) Entities directly wholly-owned by Lifestyle Dining Pte. Ltd.
Name: The Boxing Crab Pte. Ltd.
Principal activity: Sale of food and beverages
Issued share capital: $200,000 comprising 200,000 ordinary shares
Place of incorporation: Singapore
Name: Wan Style Pte. Ltd.
Principal activity: Investment holding
Issued share capital: $1,000 comprising 1,000 ordinary shares
Place of incorporation: Singapore
(ii) Entity directly wholly-owned by Wan Style Pte. Ltd.
Name: Wan Style (Singapore) Pte. Ltd.
Principal activity: Sale of food and beverages
Issued share capital: $200,000 comprising 200,000 ordinary shares
Place of incorporation: Singapore
(iii) Entity directly wholly-owned by Food Junction International Pte. Ltd.
Name: Food Junction (China) Pte. Ltd.
Principal activity: Investment holding
Issued share capital: $1,000 comprising 1,000 ordinary shares
Place of incorporation: Singapore