CFA Society Singapore
SINGAPORE (Feb 4): No Signboard Holdings has admitted to breaching two Catalist board listing rules on Jan 31 following a query from Singapore Exchange (SGX).
The seafood restaurant chain operator last Thursday triggered a query from SGX for unusual price movements after its shares jumped 24.0% to 15 cents, with close to 1.4 million shares changing hands by midday on Jan 31.
Shortly after, No Signboard called for a trading halt pending an announcement.
In a late night announcement on Sunday, Feb 3, No Signboard says the company’s chairman and CEO, Lim Yong Sim, had instructed its broker, UOB Kay Hian, to queue for the purchase of the company’s shares at a price of up to 14 cents following the approval of the share buyback mandate by the shareholders at its annual general meeting in the morning of Jan 31.
The share purchases at up to 14 cents exceeded the 5% cap above the average closing price of 12.26 cents for the last five days, breaching the share price cap.
No Signboard says this was an “honest mistake” by Lim as he did not notice that the share purchase price had exceeded the permitted 5% cap.
The shares purchase transaction was also undertaken just a day before the company’s 1Q19 results were announced on Feb 1, which is within the dealing restriction period, or black-out period.
The company says this was because it had not held its Audit Committee and Board meetings to approve the release of its 1Q results at the time of the shares purchase.
RHT Capital, the sponsor of the company, has “taken note of the breaches” and directed Lim to attend the necessary directors' trainings to re-familiarise himself with the listing rules and other relevant regulatory requirements.
It has also asked the company to develop a comprehensive internal policy and procedure on share buyback.
It adds that no share buyback shall be conducted by the company until the policy is approved by the board and properly implemented.
In its announcement, No Signboard says SGX Regulation (SGX RegCo) has directed the sponsor to ensure that directors familiarise themselves to ensure compliance with the listing rules.
SGX RegCo has also ordered that the sponsor assess and be satisfied that the company has sufficient systems, procedures and controls to comply with the rules.
For the 1Q19 ended December, No Signboard sank deeper into the red with losses of $0.6 million, some 37.8% more than losses of $0.4 million recorded a year ago.
1Q19 revenue fell 16.1% to $5.6 million, from $6.7 million a year ago.
The decline was mainly due to loss of revenue from the closure of a seafood restaurant outlet for a month to carry out major repair works, a drop of average spending per customer in the restaurant business, as well as the termination of non-performing sales contracts of customers in the entertainment establishments as part of the beer business restructuring exercise.
No Signboard on Feb 3 requested for the lifting of the trading halt.