Group Operational Review

The Group’s performance in 2021 was much improved following a difficult year in 2020, with Vedder and Deco Group both delivering a net profit for the year. Depa Interiors’ results were also significantly improved on 2020 with some project extensions during the latter part of the year negatively impacting its results.

During 2021 Depa’s board authorised management to discontinue the financial support that it had extended to support the restructuring of Design Studio Group (“DSG”). Following this decision by Depa and subsequent actions taken by the board of directors of DSG, on 19 November 2021, the Singapore High Court issued a winding up order in respect of Design Studio Group Limited and appointed liquidators to assume control of DSG. The appointment of the liquidators resulted in Depa’s loss of control of DSG. As a consequence, Depa derecognised the assets and liabilities of DSG as of this date and recorded a corresponding gain on the deconsolidation of DSG.

Following the progress made during 2019 and 2020 on the Group’s non-core asset disposal plan, Depa successfully disposed of two non-core assets; an equity investment and an investment in an associate.

Depa’s strategic review, completed in 2020, identified the Kingdom of Saudi Arabia as a key growth market for the Depa Interiors, Deco and Carrara businesses. Increased focus on this market has resulted in the Group securing a number of new wins in Saudi Arabia, with Depa Interiors and Deco securing a number of notable projects towards the end of 2021. Subsequent to year end, the Group entered into a definitive subscription agreement with the Public Investment Fund (“PIF”), whereby PIF made a cash investment of AED 150 million in Depa in return for the allotment of 750 million new Class A shares. The transaction provides Depa with the support of a strategic partner in Saudi Arabia as the Group aims to continue its growth in this market. The increased liquidity resulting from the transaction will also allow Depa to better execute its expansion plans, particularly in Saudi Arabia. The proceeds will also be used to recapitalise the business and provide additional working capital with which Depa can more comfortably deliver both its existing projects and future projects.

Mr. Kevin Lewis