mDR Limited undergoes restructuring and pay cuts

mDR Limited undergoes restructuring and pay cuts 1
mDR Limited is one of the largest distributors and retailers of telecommunication products and services, and after-market services provider in Singapore.

SINGAPORE: mDR  Limited  has notified the Singapore Exchange that its four business segments have resumed operations amid restructuring and salary cuts.

MDR’s business segments including After Market Services (AMS), Distribution Management  Solutions  (DMS),  Digital  Inkjet  Printing  for  Out-Of-Home  Advertising  Solutions  (DPAS) and Investment, some of which were temporarily closed during the Circuit Breaker Period in Singapore, are fully operational since June 2020.

Upon  the  cessation  of  the  M1  distributorship  from  19  September  20201,  Group’s  subsidiary,  HandphoneShop Pte Ltd (HPL) embarked on the rationalisation of its Retail network.

Of HPL’s total 8 stores, HPL has closed 4 stores and is currently in the process of closing an additional 5th store by October-end.

HPL has converted the rest of the 3 stores to multi-brand concept stores offering  mobile  devices,  gadgets  and  accessories.  In  addition  to  the  rationalisation  of  the  retail  network, the MDR Limited’s Singapore operations have undertaken a restructuring exercise in line with the business requirements.

DPAS division in Malaysia has also carried a restructuring exercise as per operational and business requirements and implemented salary cuts of 10%-20%. 

In  view  of  the  current  challenging  and  uncertain  business  environment,  the  Group’s  Executive  Directors and senior management have voluntarily taken a 10% salary cut effective from October 2020. 

The  Company’s  independent  directors  (other  than  those  recently  appointed  in  September  2020)  have  also  voluntarily  taken  an  approximately  25%  cut  in  Directors’  fees  effective  from  October 2020. 

Financial assessments and impact The resumption of the business and operations of the various business divisions has resulted in improved  sales  and  revenue  in  Q3-20  compared  to  Q2-20. 

On  a  Year-on-Year  basis,  Group’s  revenue for the period ended 30 September 2020 (based on preliminary review and estimates of the unaudited management accounts), is approximately 34.4% lower than the corresponding period in  FY2019,  due  to,  inter  alia,  a  decline  in  sales  from  the  above-mentioned  temporary  closure  of  business operations of certain divisions during the CB Period / MCO Period, subdued demand from domestic  customers,  and  significant  decrease  in  tourists. 

Various  support  measures  from  the  Singapore Government such as Wage credit, Job Support Scheme, rental assistance and/or rental subsidies from the malls, and the various cost-control measures undertaken by the Group, have however helped in mitigating the impact on the Group’s financial performance. Barring any unforeseen circumstances, the Group expects an overall decline in revenue and net income  for  FY2020. 

However,  the  Group’s  financial  position  is  expected  to  be  stable  taking  into  account the net asset value and cash and bank balances available to the Group. 

MDR Limited will continue to monitor the evolving situation amid the COVID-19 outbreak and will make   the   appropriate   announcement   to   keep   shareholders   updated   on   any   material   developments,” a news release said.

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