Jade Road Investments : 2021 Annual Report (English Version)

Jade Road Investments Limited

Annual Report 2021

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Contents

	Page
Company Information	3
Company Description and Investing Policy	4
Chairman's Statement	6
Biographies of Directors and Senior Management	15
Directors' Report	17
Corporate Governance Statement	22
Independent Auditor's Report	32
Consolidated Statement of Comprehensive Income	38
Consolidated Statement of Changes in Equity	39
Consolidated Statement of Financial Position	40
Consolidated Cash Flow Statement	41
Notes to the Financial Statements	43

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Company Information

Directors	Depositary Interest Registrars
Mr. John Croft	Computer Investor Services PLC
-	Executive Chairman	The Pavilions
Hugh Viscount Trenchard	Bridgwater Road
-	Non-executive Director	Bristol BS99 6ZY
Dr. Lee George Lam
-	Non-executive Director	Registered Agent
Mr. Stuart Crocker	Conyers Trust Company (BVI) Limited
-	Non-executive Director	Commence House, Wickhams Cay 1
Mr. John Batchelor	PO Box 3140
-	Non-executive Director	Road Town, Tortola
		British Virgin Islands VG1110
Investment Manager
Harmony Capital Investors Limited	Nominated Adviser
Intertrust Corporate Services (Cayman)	WH Ireland Limited
Limited, 190 Elgin Avenue, George Town	24 Martin Lane
Grand Cayman KY1-9005 Cayman Islands	London EC4R 0DR
Key Personnel of Investment Manager	Broker
Harmony Capital Investors Limited	Hybridan LLP
Mr. Suresh Withana	1 Poultry,
-	Co-founder, Managing Partner	London
		EC2R 8EJ
Registered Office
Commence House, Wickhams Cay 1	Auditors
PO Box 3140	PKF Littlejohn LLP
Road Town, Tortola	15 Westferry Circus
British Virgin Islands VG1110	London E14 4HD
Company Secretary	Legal Advisers
Conyers Trust Company (BVI) Limited	Locke Lord (UK) LLP
Commence House, Wickhams Cay 1	Second Floor
PO Box 3140	201 Bishopsgate
Road Town, Tortola,	London EC2M 3AB
British Virgin Islands VG1110
		Conyers Dill & Pearman
Principal Place of Business	Romasco Place, Wickhams Cay 1
29/F, Infinitus Plaza	PO Box 3140
199 Des Voeux Road Central, Hong Kong	Road Town, Tortola
		British Virgin Islands VG1110
Registrars
Computershare Investor Services (BVI)	Website
Limited, Woodbourne Hall PO Box 3162 Road	www.jaderoadinvestments.com
Town, Tortola, British Virgin Islands
		Stock Code
		AIM: JADE
		Frankfurt: 1CP1

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Company Description & Investing Policy

Jade Road Investments Limited ("Jade Road" or the "Company") is focused on providing growth capital and financing to emerging and established Small and Medium Enterprises ("SMEs") throughout Asia, well-diversified by national geographies, instruments and asset classes. This vital segment of the economy is underserved by the traditional banking industry and capital markets due to regulatory and structural reasons. The Company is focused on providing shareholders with attractive uncorrelated risk-adjusted returns over the short and longer-term from a diversified portfolio of pan-Asian investments.

Jade Road Investments Limited is an investment company holding portfolio investments while Harmony Capital Investors Limited acts as its external Investment Manager.

Our common stock is publicly traded on the Alternative Investment Market ("AIM") market of the London Stock Exchange, under the ticker symbol "JADE". The Board of Jade Road Investments works together with Harmony Capital Investors Limited ("Harmony Capital") to execute our investment strategy. Ultimate authority for investment decisions vests with the Board.

Investing Policy

The Investment Manager of the Company has the flexibility to invest across Asia, across sectors and across the capital structure of companies. Furthermore, given the long-term nature of the Company's investment horizon, a more flexible Investing Policy should enable the Investment Manager to navigate changes in the relative attractiveness of various financing asset classes in Asia through economic cycles and, potentially, geopolitical shifts which may increase the sovereign risk associated with specific countries relative to others within the region.

The investing policy of Jade Road is the following:

1. The Company has an indefinite life and is targeting both capital gains and income distributions for its Shareholders over time.
2. The Company will provide equity and credit funding to companies, principally in the Pan-Asia region or with a connection to Asia. It will seek to do this by:
3. 1. providing funding directly to companies via the provision of loans or other credit instruments, which may be secured against assets of the borrower or its affiliates;
   2. providing funding to companies to accelerate their growth, expand the scale of their business and/or to consolidate their organisational structure in preparation for a public listing. Investments could be in the form of structured equity, debt, and hybrid debt securities;
   3. providing growth, development, and acquisition capital in the form of equity or quasi-equity to companies within growth industries;

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1. 1. providing funding to transactions structured around significant corporate events such as recapitalisations, debt restructurings, buybacks of shares, asset spin-offs, and corporate reorganisations;
   2. investing in publicly traded or over-the-counter traded equity or credit securities, such as preferred stock, common stock, high yield bonds, senior loans, warrants, where the market is mispricing a company's securities and thereby offering an attractive risk-adjusted return due to one-off or short-term factors;
   3. investing (in addition to securing co-investment rights for the Company) as a limited partner or shareholder in third party managed vehicles which have a strategy to provide credit and/or equity funding to companies in a specific industry; and
   4. the Company will be sector agnostic in its investment activities.
2. New investments will be managed actively, including through appropriate investor protections which will be negotiated on each transaction as appropriate and relevant.
3. The Company will consider using debt to finance transactions on a case-by-case basis and may assume debt on its own balance sheet when appropriate to enhance returns to Shareholders and/or to bridge the financing needs of its investment pipeline.
4. The Company may decide to dispose of or exit, partially or fully, existing investments in the Company's portfolio where appropriate and based on the recommendations of the Investment Manager.

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