Dear Shareholders,

On behalf of the Board of Directors (the “Board”) of mDR Limited (the “Company”, and together with its subsidiaries, the “Group”), I am pleased to present to you our annual report for the financial year ended 31 December 2020.

FY2020 has been a very challenging year. The COVID-19 pandemic caused an unprecedented crisis globally and has affected economies worldwide. Singapore’s economy contracted by 5.4% in 2020 on a year-on-year (“YoY”) basis (2019: growth of 0.7%). The Group’s performance and profitability in FY2020 was affected by, inter alia, a decline in revenue, termination of the M1 distribution business, and Tsinghua’s bond default. FY2020 revenue declined because of the temporary closure of certain business divisions during the Circuit-Breaker (“CB”) period in Singapore and the Movement Control Order (“MCO”) period in Malaysia, and the dampening of consumer sentiments and limited visitor arrivals and tourism receipts arising from COVID-19 related travel restrictions. Government support measures, rental assistance and/or rental subsidies from the malls, and the support of our stakeholders, however helped us to navigate through what was otherwise a difficult year.


A summary of the Group’s financial performance in FY2020 is set out below.

The Group’s YoY revenue decreased by $92.89m to $192.80m (FY2019: $285.69m). The net loss of the Group was due to the impairment of financial assets and loss allowance for trade receivables in relation to the coupon payment of Tsinghua’s debt security; and impairment for right of use assets (leases of non-performing outlets).

Revenue from the After Market Solutions (“AMS”) division decreased YoY by 13% from $19.86m to $17.33m, primarily due to lower repair volumes.

Revenue contribution from the Distribution Management Solutions (“DMS”) division decreased YoY by $88.80m to $164.25m (FY2019: $253.05m) mainly due to lower sales volume generated from the retail operations because of temporary business closures during the CB period and the cessation of the M1 distribution business.

Revenue for the Group’s Digital Inkjet Printing for Out-Of-Home Advertising Solutions (“DPAS”) division was $3.30m — 43% lower than the 2019 revenue of $5.79m partly due to lower sales mainly arising from the temporary closure of Pixio’s operations during Malaysia’s MCO period.

Investment division’s revenue increased by 13% to $7.92m (FY2019: $6.99m), primarily due to increase in coupon interest income from investment in bonds by $1.10m. As at 31 December 2020, MDR has a portfolio of approximately $120.10m of equities and debt securities (before loss allowance on investment in debt securities) assets, generating dividend and coupon payments. The Group’s investment portfolio in equities registered a negative total return of 6.92% in 2020. During the same period, the STI and FTSE ST Catalist’s total return (inclusive of dividend) was a loss of 8.0% and a gain of 17.38% respectively.

The Group’s net tangible assets as at 31 December 2020 was $127.34m (31 December 2019: $152.34m). Cash and cash equivalents of the Group as at 31 December 2020 increased and was $12.32m (31 December 2019: $7.13m).


Singapore Operations

The Group is one of the largest distributor, retailer and aftermarket service provider of mobile phones. The Company is Samsung’s authorised aftermarket services provider for mobile phones and other consumer electronic goods. The AMS division manages and operates Samsung’s 4 service centres — at Plaza Singapura, VivoCity, Westgate and Causeway Point. Group’s DMS division currently operates an island-wide network of 9 Singtel retail outlets (including 2 franchised outlets), 3 Handphoneshop (HPS) stores offering lifestyle goods and accessories, 3 Samsung concept stores at Plaza Singapura, VivoCity and Westgate, and 1 VT Cosmetics store at Plaza Singapura.

Group’s investment business pertains to investments in equity, debt securities, and loans. Of the Company’s total investments of $115.55m (as at 17 March 2021) after impairment of bonds, $106.04m is classified under non-current assets. These investments are held for the long term to generate investment returns/income (interest, dividends and capital gains).

Malaysia Operations

The DPAS operations in Malaysia under Pixio uses state of the art colour-management systems and latest machinery and offers a range of large format digital printing solutions. Pixio’s clientele include several well-known MNCs.

Malaysia implemented stricter measures to contain the resurgence in COVID-19 infections in early-2021 which is likely to slow down the pace of the economic recovery from the pandemic. As DPAS is dependent on the advertising expenditure of its clients which would be affected by a slowdown in the economy, the division is expected to be impacted by the economic slowdown.

The Group remains cautious and is committed to exercising cost discipline in its businesses and strengthening its revenue streams in the long term. We will channelise our resources and efforts in FY2021 towards making a turnaround to profitability.


The COVID-19 crisis is still ongoing. The development of the vaccines and ongoing immunisation efforts are expected to spur the global economic recovery. While new variants and waves of the COVID-19 virus may continue to pose uncertainties, several economies have started showing signs of gradual recovery.

The Investment division is progressively reallocating its investment mix, with a view to hold up to 100% equities in the investment portfolio. Dividend income will continue to be the main source of revenue for the division, though such income for FY2021 may be lower than prior years, as businesses are expected to be conservative in dividend payouts. Real estate is still looking overvalued. We expect to add real estate assets in the future when prices and valuations are attractive.

DMS’s retail and distribution performance is expected to be modest as the consumer goods sector is unlikely to return to pre-COVID-19 levels with weaker consumer spending due to the economic downturn and limited visitor arrivals and tourism receipts. DMS restructured its business operations in the 4th quarter of 2020 with the cessation of M1’s distribution business and will continue to exercise financial prudence through a tight rein on costs. The division will capitalise on its business relationship with its business partners and principals to grow the business.


We are pleased to share that we achieved 51st rank (out of 577 SGX listed companies) in the corporate governance ranking in the Singapore Governance and Transparency Index 2020, which puts us ahead of even some of the STI constituents.

In view of the challenging and uncertain business environment, the Group’s Executive Directors and senior management voluntarily have taken a 10% salary cut effective from October 2020. The Company’s independent directors (other than those appointed in September 2020) have also taken an approximately 25% cut in Directors’ fees effective from October 2020. All Executive Directors and Department Heads have also foregone their bonuses for FY2020.


The Company has a dividend policy of declaring at least 50% of its full year profits as dividend. In view of the impairments and loss allowance made for FY2020, the Company is unable to declare a final dividend for FY2020. We have paid dividend consecutively since the financial results for the full year ended 31 December 2015. While we are dissatisfied by FY2020’s performance, we remain committed to achieve better performance and dividend payment in the future.


Since its introduction in March 2019, we have been holding management conference calls with shareholders/analysts/media. These briefings have helped us to gather valuable feedback and maintain regular communication with our investors. We welcome all shareholders to join us in our earnings calls and at the upcoming AGM to share their views and feedback.


On behalf of the Board and management, I express my sincere thanks to all our business associates, shareholders and customers for their support. I also extend my appreciation to fellow Directors, management and employees of the Group for their efforts that helped the Group to navigate through a difficult year. We look forward to a bright and successful year ahead.

Edward Lee
Executive Chairman
31 March 2021