Directors Report

The Directors present their Report with the financial statements of the Company for year ended 31 December 2019.

Results and dividends

The results for the year are set out in the Statement of Comprehensive Income on page 16. The Directors do not recommend the payment of a dividend on the Ordinary Shares.

Company objective

The Company's primary objective is that of securing the best possible value for the shareholders, consistent with achieving both capital growth and income for shareholders. The Company intends to undertake one or more acquisitions of business (either shares or assets) which operate in or own Western F&B eatery franchises in South East Asia and/or the Far East.

The Company will retain flexibility between: (i) establishing a new franchise in a new region, in which case it would purchase the franchise and then build a management team to operate the franchise; or (ii) purchasing an established franchise and seeking to grow this both within its established region and in other regions in Asia.

The Company's business risk

An explanation of the Company's financial risk management objectives, policies and strategies is set out in note 11 and the Operating and Financial Review. 

Key events

On 19 February 2019, The Company agreed to enter into non-binding conditional heads of terms with Typical Dutch N.V. ("TDNV") under which it was proposed that DaVictus acquire the intellectual property rights in a restaurant concept currently owned by TDNV, including their recipes, collection of Cuban/Havana graphics for a restaurant concept branded as HAVANA Rolled Cigar Music Café (or simply "the HAVANA").

Directors

The Directors who served the Company during the year and their beneficial interest in the Ordinary Shares of the Company at 31 December 2019 were as follows:

Directors' interest

As at 31 December 2019, Robert Pincock, one of our directors, owns 1,250,000 ordinary shares, which represents an 10.29 % interest.

Substantial shareholders

The Company has been notified of the following interests of 3 per cent or more in its issued share capital as at 20 May 2020

Capital and returns management

The investment size for acquisition will be dependent on the franchise name and type of franchise agreement, with each opportunity being evaluated on a case-by-case basis. The Directors believe that, following an acquisition, further equity capital raisings may be required by the Company for working capital purposes as the Company pursues its objectives.

The Company expects that any returns for Shareholders would derive primarily from capital appreciation of the Ordinary Shares and any dividends paid pursuant to the Company's dividend policy.

Dividend policy

The Directors recognise the importance of dividends to investors and, as the Company's business matures, will keep under review the desirability of paying dividends. Future income generated by the Company is likely to be re-invested in the Company to implement its strategy. In view of this, it is unlikely that the Board will recommend a dividend in the early years following Admission. There are no fixed dates for dividend payments by the Company and no dividends have been paid to date, although should the Company be in a position to declare a dividend in the future it will consider this at that time.

Going concern

As described in the note 2 (c), the financial statement have been prepared on a going concern basis, which assumes that the Company will continue to be able to meet its liabilities as they fall due for the foreseeable future.

In addition to the already known effects of the COVID-19 outbreak and resulting government measures, the macroeconomic uncertainty causes disruption to economic activity, and it is unknown what the longer term impact on our business may be. The COVID-19 virus can evolve in various directions. Management seeks to obtain the best possible information to enable us to assess these risks and implement appropriate measures to respond.

However with all those risks and impact above, The Company have taken and will take a number of measures to monitor and prevent the effects of the COVID-19 virus. This includes safety and health measures for our people (ie social distancing and working from home), securing the supply of materials that are essential to our production process, securing additional financing from directors to support continuity of our operations and communication to our key stakeholders.

In addition, as a F&B franchiser, the company assists franchisees to adopt the new normal of post-COVID-19 customer behavior to restaurant guideline such as

·    Exploration of take-out, drive-through & delivery options

·    Increased domestic/local sourcing for supply chain

·    New & expanded sanitization practices in the preparing and handling food

·    Simplifying the operation and SKUs reduces sourcing risks and is simply easier to manage

The Company will not pay any dividends this year. Based on the facts and circumstances known at this moment and the possible scenarios about how the COVID-19 virus and resulting government measures could evolve, management has determined that the use of the going concern assumption is warranted, but that there is a material uncertainty resulting from COVID-19 and the reliance support of the directors that may cast significant doubt upon the entity's ability to continue as a going concern and, therefore, that it may be unable to realize its assets and discharge its liabilities in the normal course of business. Based on the circumstances described above, the financial statements are prepared on the assumption that the entity is a going concern.

Corporate governance

There is no applicable regime of corporate governance to which the directors of a Jersey company must adhere over and above the general fiduciary duties and duties of care, skill and diligence imposed on such directors under Jersey law.

The Company has not yet adopted a corporate governance structure as it is still in an early stage of development. Neither the diversity policy was adopted by the Company.

However, the board has developed corporate governance process as discussed below. These processes have been determined with reference to the Quoted Companies Alliance revised Corporate Governance Code for Small and Mid-Size Quoted Companies ('the QCA Code'), which the Company intends to adopt in the future following an acquisition.

(1)    Structure and process. The Company is young and not yet fully active in its chosen business. Governance is achieved by the Directors acting together in approving all activity and by accounting and financial control being in the hands of the Directors acting alongside third party service providers.

(2)    Responsibility and accountability. Although the team is small, roles are clearly defined. The Board is chaired by a seasoned Non-Executive Chairman who is not the chief executive, and the Board also benefits from having a second seasoned Non-Executive Director who is independent.

(3)    Board balance and size.  Because of its small size and low level of commercial activity, the Company is well managed under a Board of three Directors, none of whom works elsewhere with the others or worked previously with the others and all of whom have individual professional standing.

(4)    Board skills and capabilities. Robert Pincock has directly relevant and current knowledge of running businesses in the Company's chosen sector and geographical markets. The other two Directors have extensive financial and governance experience, one with particular knowledge of the London markets and one with particular knowledge of South East Asian markets.

(5)    Performance and development. Each year the board conducts a review of the performance of the Directors and of Board committees, and make a formal consideration as to the need for change.

(6)    Information and support. The Directors share and discuss all relevant information and draw upon external advice as required.

(7)    Cost-effective and value-added. Recognising the early stage of development, the Directors do not intend to formalise a review of this until after the Company makes its first acquisition.

(8)    Vision and strategy. The Directors set out their clear vision in the Admission prospectus. No changes have been made since then.

(9)    Risk management and internal control. These matters fall into the remit of the Company's Audit and Remuneration Committees.

(10)  daVictus held Annual General Meeting on 1 August  2019 with engagement with shareholder who attended to vote for the given resolutions and approved those resolutions including the adoption of audited account 2018, re-appointment of director and auditor.

(11)  Stakeholder and social responsibility. The Directors are mindful of the impact of the Company on wider society and will ensure a formal corporate and social responsibility regime is put in place following the Company's first acquisition.

At a general meeting at which a director retires by rotation, the Company may fill the vacancy and, if it does not do so, the retiring director shall be, if willing, deemed reappointed. A Director who retires at an annual general meeting may, if willing to act, be reappointed. If he is not reappointed (or deemed reappointed by the Company failing to fill the vacancy), he may retain office until the meeting appoints someone in his place or, if it does not do so, until the end of the meeting.

Following the Company's first acquisition, the Company may seek to transfer from a Standard Listing to either a Premium Listing or other appropriate listing venue, based on the track record of the company or business it acquires, subject to fulfilling the relevant eligibility criteria at the time. If the Company is successful in obtaining a Premium Listing, further rules will apply to the Company under the Listing Rules and Disclosure and Transparency Rules and the Company will be obliged to comply with EU's Market Abuse Regulation ("MAR).

The Company has established the following committees:

Audit committee

The audit committee, which currently comprises Malcolm Groat (as chair) and Hadi Majid, has the primary responsibility for monitoring the quality of internal control and ensuring that the financial performance of the Company is properly measured and reported on and for reviewing reports from the Company's auditors relating to the Company's accounting and internal controls. The committee is also responsible for making recommendations to the Board on the appointment of auditors and the audit fee and for ensuring the financial performance of the Company is properly monitored and reported. The audit committee will meet not less than three times a year.

Remuneration committee

The remuneration committee, which currently comprises Hadi Majid (as chair) and Malcolm Groat, is responsible for the review and recommendation of the scale and structure of remuneration for senior management, including any bonus arrangements or the award of share options with due regard to the interests of the Shareholders and the performance of the Company.

Nomination committee

The Company does not have a nomination committee as the Board does not consider it appropriate to establish such a committee at this stage of the Company's development. Decisions which would usually be taken by the nomination committee will be taken by the Board as a whole.

Auditors

The auditors, Crowe U.K. LLP, have expressed their willingness to continue in office and a resolution to reappoint them will be proposed at the Annual General Meeting.

Statement of Directors' responsibilities

The Directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.

Company law requires financial statements to be prepared for each financial year in accordance with one of the prescribed generally accepted accounting principles. Under that law the directors have elected to prepare the financial statements in accordance with International Financial Reporting Standards (IFRSs') as adopted by the EU and applicable law.

The directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

-     select suitable accounting policies and then apply them consistently;

-     make judgments and accounting estimates that are reasonable and prudent;

-    state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements;

-     prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

The directors are responsible for keeping proper accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies (Jersey) Law 1991. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The directors are responsible for keeping proper accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The maintenance and integrity of the daVictus plc website is the responsibility of the Directors.

Legislation in Jersey or the United Kingdom governing the preparation and dissemination of the accounts and the other information included in annual reports may differ from legislation in other jurisdictions.The Directors confirm, to the best of their knowledge that:

·    the financial statements, prepared in accordance with the applicable set of accounting standards, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Company; and

·    the management report includes a fair review of the development and performance of the business and the position of the Company, together with a description of the principal risks and uncertainties that it faces.

Statement as to Disclosure of Information to Auditors

The Directors confirm that:

·    there is no relevant audit information of which the Company's statutory auditor is unaware; and

each Director has taken all the necessary steps he ought to have taken as a Director in order to make himself aware of any relevant audit information and to establish that the Company's statutory auditor is aware of that information.

Subsequent events

On 19 February 2020, a prospectus relating to: (i) the Company's conditional acquisition by way of a reverse takeover of the intellectual property rights in a restaurant concept owned by Typical Dutch N.V. ("TDNV");   (ii) the placing of 900,000 new ordinary shares of no par value at 15 pence per share; and (iii) the admission of 12,150,00 ordinary shares of no par value to the Official List (by way of Standard Listing under Chapter 14 of the Listing Rules) and to trading on the London Stock Exchange's Main Market for listed securities ("Admission") was approved by the Financial Conduct Authority.

On 26 March 2020, the Company announced that it has signed a Memorandum of Understanding (MOU) with Asia Food Venture Sdn Bhd (AFV) to appoint the first franchisee of its premium dining restaurant concept in Kuala Lumpur, Malaysia.

On 6 May 2020 , the Company newly incorporated Havana Dining Ltd, incorporated in British Virgin Island, for the purpose of business operations as a wholly-owned subsidiary of the Company including running of the day-to-day operations.

Furthermore, The COVID-19 outbreak has developed rapidly in 2020, with a significant number of infections. Measures taken by various governments to contain the virus have affected economic activity in overall. The Company have taken a number of measures to monitor and prevent the effects of the COVID-19 virus such safety and health measures for our people, such as social distancing and working from home. At this stage, the impact on our business and results is limited. We will continue to follow the various national policies and advice and in parallel will do our utmost to continue our operations in the best and safest way possible without jeopardizing the health of our people.

This responsibility statement was approved by the Board of Directors on 19 June 2020 and is signed on its behalf by;

………………………………………….

Robert Pincock

Director

19 June 2020