BreadTalk - Annual Report 2014

D I R E C TO R S R E P O R T
The directors are pleased to present their report to the members together with the audited consolidated financial statements
of BreadTalk Group Limited (the Company) and its subsidiaries (collectively, the Group) and the balance sheet and
statement of changes in equity of the Company for the financial year ended 31 December 2014.
I N D E X
P A G E
DIRECTORS
The directors of the Company in office at the date of this report are:
45 52 53 55 56
Directors
Report
Statement by
Directors
Independent
Auditors Report
Consolidated
Statement of
Comprehensive
Income
Balance Sheets
Consolidated
Cash Flow
Statement
Notes to
the Financial
Statements
167
Proxy
Form
Statistics of
Shareholdings
Arrangements to enable directors to acquire shares and debentures
Notice of
General Meeting
Directors interests in shares and debentures

The following directors, who held office at the end of the financial year, had, according to the register of directors shareholdings
required to be kept under section 164 of the Singapore Companies Act, Chapter 50, an interest in shares of the Company as
stated below:

Name of Director
Direct interest
As at 1
January
2014
Deemed interest
As at 31
December
As at 21
2014
January 2015
As at 1 As at 31
January December
As at 21
2014
2014
January 2015
The Company
(Ordinary shares)

Dr George Quek Meng Tong
95,673,470
95,687,660
95,687,660

Katherine Lee Lih Leng
52,400,830
52,415,020
52,415,020

Ong Kian Min
120,000
120,000
120,000

Tan Khee Giap

20,000

(Conditional award of restricted shares)
44 BreadTalk Group Limited ANNUAL REPORT 2014
(Chairman)
(Deputy Chairman)
Except as disclosed in this report, neither at the end of nor at any time during the financial year was the Company a party to
any arrangement whose objects are, or one of whose object is, to enable the directors of the Company to acquire benefits by
means of the acquisition of shares or debentures of the Company or any other body corporate.
58 62 65 158 160
Statements
of Changes in
Equity

Ong Kian Min
Chan Soo Sen
Dr Tan Khee Giap
14,190
14,190
14,190
14,190

20,000
20,000
BreadTalk Group Limited ANNUAL REPORT 2014
45
Directors interests in shares and debentures (contd)
Share Option and Share Plans (contd)
By virtue of Section 7 of the Companies Act, Chapter 50, Dr George Quek Meng Tong and Katherine Lee Lih Leng are deemed
to be interested in the shares held by the Company in its subsidiaries.
(a) The BreadTalk Group Limited Employees Share Option Scheme (contd)
Except as disclosed in this report, no other director who held office at the end of the financial year had interest in shares or
debentures of the Company, or of related corporations, either at the beginning of the financial year, or date of appointment or
the end of the financial year or on 21 January 2015.
Directors contractual benefits
Except as disclosed in the financial statements, since the end of previous financial year, no director of the Company has received
or become entitled to receive a benefit by reason of a contract made by the Company or a related corporation with the
director, or with a firm of which the director is a member, or with a company in which the director has a substantial financial
interest.
Share Option and Share Plans
The Company has a Share Option Scheme and a Restricted Share Grant Plan which are administered by the Remuneration
Committee comprising three Directors namely Messrs Chan Soo Sen (Chairman), Ong Kian Min (Member) and Dr Tan Khee
Giap (Member). Details of the Share Option Scheme and the Restricted Share Grant Plan are as follows:
(a)
The BreadTalk Group Limited Employees Share Option Scheme
The BreadTalk Group Limited Employees Share Option Scheme (ESOS) was approved at an Extraordinary General
Meeting held on 30 April 2003. The following persons are eligible to participate in the ESOS at the absolute discretion of
the Remuneration Committee:
Size of ESOS
The total number of new shares over which options may be granted pursuant to the ESOS shall not exceed fifteen per
cent (15%) of the issued share capital of the Company on the date preceding the grant of an option.
The aggregate number of Shares available to eligible Controlling Shareholders and their Associates under the ESOS shall
not exceed twenty five per cent (25%) of the Shares available under the ESOS. In addition, the number of Shares
available to each Controlling Shareholder or his Associate shall not exceed ten per cent (10%) of the Shares available
under the ESOS.
Grant of ESOS
Acceptance of ESOS
Options may be granted from time to time during the year when the ESOS is in force, except that options shall be
granted on or after the second market day on which an announcement of any matter involving unpublished price sensitive
information is released.
The grant of an option shall be accepted not more than 30 days from the offering date of that option and accompanied
by payment to the Company of a nominal consideration of $1 or such other amount as required by the Remuneration
Committee.
Since the commencement of the ESOS up to the end of the financial year, there were no options granted to any person.
Any options granted under the ESOS do not entitle the holders of the options, by virtue of such holdings, to any right to
participate in any share issue of any other company.
(i) Employees and Directors

Employees, executive directors and non-executive directors of the Group who are not on probation and have
attained the age of 21 years on or before the Offering Date.
(b) The BreadTalk Restricted Share Grant Plan

The BreadTalk Restricted Share Grant Plan (RSG Plan) was approved at an Extraordinary General Meeting held on 28
April 2008.
(ii) Controlling Shareholders and their Associates

Controlling Shareholders or their Associates whose participation and actual number of shares issued to them must
be approved by independent shareholders in general meeting.
The RSG Plan is centred on the accomplishment of specific pre-determined performance objectives and service conditions,
which is the prerequisite for the contingent award of fully paid Shares (Award). The reward structure allows the
Company to target specific performance objectives and incentivise the Participants to put in their best efforts to achieve
these targets.
47
(b) The BreadTalk Restricted Share Grant Plan (contd)
(b) The BreadTalk Restricted Share Grant Plan (contd)
Eligibility
Grant of RSG Plan
The following persons shall be eligible to participate in the RSG Plan subject to the absolute discretion of the
Remuneration Committee:
The grant of Awards under the RSG Plan may be made from time to time during the year when the RSG Plan is in force.
While Awards may be granted at any time in the year, it is anticipated that Awards under the RSG Plan would be made
once a year, after the Companys annual general meeting. It will be administered by the Remuneration Committee.
Share Awards and Vesting
(ii)
Directors
The final number of restricted shares awarded will depend on the achievement of pre-determined targets over a one year
period. On meeting the performance conditions for the performance period, one-third of the restricted shares will vest.
The balance will vest equally over the subsequent two years with fulfilment of service requirements.
Executive and non-executive directors of the Company and its subsidiaries, provided always that any of the aforesaid
persons:
The details of the restricted shares awarded under the RSG Plan since its commencement up to 31 December 2014 are
as follows:
- have attained the age of twenty-one (21) years on or before the Award Date; and
- are not undischarged bankrupts.
(i)
Employees

Employees who are confirmed in their employment with the Company or any subsidiary, or employees of associated
companies who hold such rank as may be designated by the Committee from time to time and who, in the opinion of
the Committee, have contributed or will contribute to the success of the Group; and
Controlling Shareholders and their Associates within the above categories are eligible to participate in the RSG
Plan. Participation in the RSG Plan by Controlling Shareholders or their Associates must be approved by the independent
shareholders. A separate resolution shall be passed for each such Participant and to approve the number of Shares to
be awarded to the Participant and the terms of such Award.
There shall be no restriction on the eligibility of any Participant to participate in any other share option or share incentive
schemes implemented or to be implemented by the Company or another company within the Group.
Size of RSG Plan
The aggregate number of Shares available to eligible Controlling Shareholders and their Associates under the RSG Plan
shall not exceed twenty five per cent (25%) of the Shares available under the RSG Plan. In addition, the number of Shares
available to each Controlling Shareholder or his Associate shall not exceed ten per cent (10%) of the Shares available
under the RSG Plan.
The aggregate number of Shares to be awarded pursuant to the RSG Plan when added to the number of Shares issued
and issuable in respect of such other Shares issued and/or issuable under such other share-based incentive schemes of
the Company, including but not limited to the ESOS, shall not exceed fifteen per cent (15%) of the total issued share
capital excluding treasury shares of the Company on the day preceding the relevant Award Date.
Aggregate
Aggregate conditional

conditional Aggregate Aggregate restricted

restricted conditional conditional shares Aggregate

Conditional
shares
restricted
restricted
vested and conditional

restricted awarded shares shares released
restricted
shares
since
lapsed since vested and
since
shares

granted
commence- commence- released commence- outstanding

during the
ment of the ment of the
during the ment of the at end of the
Name of Participant
year
Plan
Plan
year
Plan
year

(a)
(b)
(c) (a)-(b)-(c)
Directors of the
Company

Dr George Quek
Meng Tong (1)

179,200

14,190 179,200
Katherine Lee
Lih Leng (1)

154,000

14,190 154,000

Associate of a
Controlling
Shareholder

Frankie Quek Swee
Heng (2)
58,000 183,000

74,070 111,800 71,200

49
Auditor

Aggregate

Aggregate
conditional

conditional Aggregate Aggregate restricted

restricted conditional conditional shares Aggregate

Conditional
shares
restricted
restricted
vested and conditional

restricted
awarded
shares
shares
released
restricted

shares
since
lapsed since vested and
since
shares

granted
commence- commence- released commence- outstanding

during the
ment of the ment of the
during the ment of the at end of the
Name of Participant
year
Plan
Plan
year
Plan
year

(a)
(b)
(c)
(a)-(b)-(c)
Ernst & Young LLP have expressed their willingness to accept re-appointment as auditor.
Participants who
received 5% or more of
the total grants available

Director
Oh Eng Lock (3)

65,000
1,607,430
Cheng William
20,000
321,200
Jenson Ong Chin
Hock
22,000
88,600
Lawrence Yeo Kia
Yeow
40,000
131,000
Other participants
109,000
1,547,400

314,000
4,211,830
563,654
43,500
1,478,740
265,560
128,690
55,640
18,250
53,400
35,200

161,640
30,340
103,340
50,740
1,140,470
80,260
245,290
161,640
861,534
3,433,910
616,280
(1) Also a controlling shareholder of the Company

(2) Associate of Dr George Quek Meng Tong, a controlling shareholder of the Company
(3) This includes a total of 781,666 shares and 488,764 shares that were released via the issuance of treasury shares in
On behalf of the board of directors:

Director
Singapore
30 March 2015
relation to a sign-on bonus as well as award of service equity granted to Mr. Oh Eng Lock.
With the Remuneration Committees approval on the achievement of the performance targets for the performance
period from FY2011 to FY2013, a total of 399,830 restricted shares were released via the issuance of treasury shares.
Audit Committee
The Audit Committee performed the functions specified in the Companies Act. The functions performed are detailed in the
Report on Corporate Governance.
51
S T AT E M E N T B Y D I R E C T O R S
We, Dr George Quek Meng Tong and Katherine Lee Lih Leng, being two of the directors of BreadTalk Group Limited, do
hereby state that, in the opinion of the directors,
(i)

the accompanying balance sheets, consolidated statement of comprehensive income, statements of changes in equity, and
consolidated cash flow statement together with notes thereto are drawn up so as to give a true and fair view of the state
of affairs of the Group and of the Company as at 31 December 2014 and the results of the business, changes in equity
and cash flows of the Group and the changes in equity of the Company for the year ended on that date, and
(ii) at the date of this statement, there are reasonable grounds to believe that the Company will be able to pay its debts as

and when they fall due.
On behalf of the board of directors:
I N D E P E N D E N T A U D I TO R S R E P O R T
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2014
Independent auditors report to the members of BreadTalk Group Limited

Report on the financial statements
We have audited the accompanying consolidated financial statements of BreadTalk Group Limited (the Company) and its
subsidiaries (the Group) set out on pages 55 to 157, which comprise the balance sheets of the Group and the Company
as at 31 December 2014, the statements of changes in equity of the Group and the Company, consolidated statement of
comprehensive income and consolidated cash flow statement of the Group for the year then ended, and a summary of
significant accounting policies and other explanatory information.
Managements responsibility for the financial statements
Management is responsible for the preparation of financial statements that give a true and fair view in accordance with the
provisions of the Singapore Companies Act, Chapter 50 (the Act) and Singapore Financial Reporting Standards, and for
devising and maintaining a system of internal accounting controls sufficient to provide a reasonable assurance that assets are
safeguarded against loss from unauthorised use or disposition; and transactions are properly authorised and that they are
recorded as necessary to permit the preparation of true and fair profit and loss accounts and balance sheets and to maintain
accountability of assets.
Auditors responsibility

Director

Director
Singapore
30 March 2015
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in
accordance with Singapore Standards on Auditing. Those standards require that we comply with ethical requirements and
plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material
misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements.
The procedures selected depend on the auditors judgment, including the assessment of the risks of material misstatement of
the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control
relevant to the entitys preparation of financial statements that give a true and fair view in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entitys
internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of
accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
53
I N D E P E N D E N T A U D I TO R S R E P O R T
Independent auditors report to the members of BreadTalk Group Limited

Opinion
In our opinion, the consolidated financial statements of the Group and the balance sheet and statement of changes in equity of
the Company are properly drawn up in accordance with the provisions of the Act and Singapore Financial Reporting Standards
so as to give a true and fair view of the state of affairs of the Group and of the Company as at 31 December 2014 and the
results, changes in equity and cash flows of the Group and the changes in equity of the Company for the year ended on that
date.
Report on other legal and regulatory requirements
In our opinion, the accounting and other records required by the Act to be kept by the Company and by those subsidiaries
incorporated in Singapore of which we are the auditors have been properly kept in accordance with the provisions of the Act.
Ernst & Young LLP

Public Accountants and
Chartered Accountants
Singapore
30 March 2015
C O N S O L I D AT E D S T AT E M E N T O F C O M P R E H E N S I V E I N C O M E
FOR THE YEAR ENDED 31 DECEMBER 2014

Notes 2014 2013

$000
$000

Revenue
3 589,644 536,530
Cost of sales
(279,018)
(251,973)

Gross profit 310,626 284,557
Other operating income
4
18,300
11,899
Interest income
5
2,058
1,316
Distribution and selling expenses
(233,005)
(209,937)
Administrative expenses
(70,998)
(63,596)
Interest expense
5
(3,728)
(2,675)

Profit before tax and share of results of associates and joint

ventures 23,253 21,564
Share of results of associates
(1,085)
231
Share of results of joint ventures
645
595

Profit before taxation
6 22,813 22,390
Income tax expense
8
(6,760)
(6,251)

Profit for the year 16,053 16,139

Profit attributable to:
Owners of the Company
12,194
13,600
Non-controlling interests
3,859
2,539

16,053
16,139

Other comprehensive income:
Items that may be reclassified subsequently to profit or loss
Net fair value loss on available-for-sale financial assets
(111)
(103)
Foreign currency translation
1,643
1,421

Other comprehensive income for the year, net of tax 1,532 1,318

Total comprehensive income for the year
17,585
17,457

Total comprehensive income attributable to:
Owners of the Company
13,726
14,918
3,859
2,539

17,585
17,457

Earnings per share (cents)
Basic
9
4.33
4.83

Diluted
9
4.32
4.82

The accompanying accounting policies and explanatory notes form an integral part of the financial statements.
55
BALANCE SHEETS
A S AT 3 1 D E C E M B E R 2 0 1 4
BALANCE SHEETS
A S AT 3 1 D E C E M B E R 2 0 1 4

Notes Group Company

2014 2013
2014 2013

$000
$000
$000
$000
Non-current assets
Property, plant and equipment
10
220,670 225,860
Investment property
11
23,153

Intangible assets
12
7,691
7,772
Investment securities
13
77,182
59,799
Investment in subsidiaries
14

Investment in associates
15
3,033
4,568
Investment in joint ventures
16
8,235
3,638
Other receivables
18
2,350
3,277
Fixed deposit
20

10,671
Deferred tax assets
8
4,970
4,287

347,284 319,872

Current assets
75,560

24,170

74,115
23,657
67
99,730
97,839
Inventories
17
10,629 10,004
Trade and other receivables
18
54,494
49,145
Prepayments
5,783 6,395
Tax recoverable
8
6
Due from related corporations
19
1,885
959
Amounts due from minority
shareholders of subsidiaries
(non-trade)
24
518
395
Cash and cash equivalents
20
95,452
79,420
Assets of disposal group classified
as held for sale
21

2,056

168,769 148,380

Current liabilities
1,854
968
120 86

26,412
16,753
Trade and other payables

22
Other liabilities
23
Provision
23
Due to related corporations
19
Loan from a minority shareholder of
a subsidiary
24
Short-term loans
25
Current portion of long-term loans
26
Tax payable

3,047

9,214
31,433
27,021
97,675
65,226
11,681
5,162
102,589
59,531
10,223
3,901
1,430
3,280
22
32,103
2,669
5,793
22
27,457
200
32,367
43,965
6,825
200
9,746
20,554
6,458

4,032

3,135
40,867
39,076

263,101 213,202

Notes Group Company

2014 2013
2014 2013

$000
$000
$000
$000
Net current liabilities
(94,332) (64,822)
(9,434) (12,055)

Non-current liabilities

Other liabilities
23
12,626
10,297


a subsidiary
24
476

Long-term loans
26
121,487 138,216
47,158
49,048
Deferred tax liabilities
8
2,619
2,554
167

137,208 151,067
47,325 49,048

Net assets
115,744 103,983
42,971 36,736

Equity attributable to owners of the Company

Share capital
27
33,303
33,303
33,303
33,303
Treasury shares
27
(3)
(187)
(3)
(187)
Accumulated profits
28
64,515
57,499
9,008
3,159
Other reserves
28
4,687
3,338
663
461

102,502 93,953
42,971 36,736
13,242
10,030

Total Equity
115,744 103,983
42,971 36,736

57

59
Attributable to owners of the Company
Others
Transfer of statutory reserves

(107)
107

At 31 December 2014
33,303
(3)
64,515
2,864
2,309

356
(1,149)
307
102,502
13,242 115,744

Premium

paid

Fair
Share
on

value
based acquisition

Accu- Statutory Trans- adjust- compen- of non-
Non-con2014
Share Treasury mulated reserve
lation
ment
sation controlling Capital
trolling Total
Group
capital shares profits
fund
reserve reserve reserve interests
reserve Total interests equity

$000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000

(Note 27) (Note 27) (Note 28) (Note 28) (Note 28) (Note 28) (Note 28) (Note 28) (Note 28)
S T AT E M E N T S O F C H A N G E S I N E Q U I T Y
At 1 January 2014
33,303
(187)
57,499
2,757
666
111
286
(657)
175
93,953
10,030 103,983
Profit for the year

12,194

12,194
3,859
16,053

Other comprehensive income
Net fair value loss on available for-sale financial assets

(111)

(111)

(111)

1,643

1,643

1,643
Other comprehensive income for
the year, net of tax

1,643
(111)

1,532

1,532
Total comprehensive income for
the year

12,194
1,643 (111)

13,726 3,859 17,585

Contributions by and distributions
to owners
Share-based payments

650 (1) 305
955 955
Dividends paid (Note 36)

(5,071)

(5,071)
(155)
(5,226)
Dividends payable

(984)
(984)
Treasury shares transferred on
vesting of restricted share grant

103

(235)

132

Purchase of treasury shares

(569)

(569)

(569)

Total contributions by and
distributions to owners

184
(5,071)

70

132
(4,685) (1,139)
(5,824)

Changes in ownership interests in
a subsidiary
Acquisition of non-controlling
interests without a change in control

(492)

(492)
492

Total transactions with owners in
their capacity as owners

184
(5,071)

70
(492)
132
(5,177)
(647)
(5,824)

Premium

paid

Fair
Share
on

value
based acquisition

Non-con2014
lation
ment
trolling Total
Group
fund

$000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000

60
Attributable to owners of the Company
At 1 January 2013
33,303
(406)
47,559
2,757
(755)
214
379
(657)
156
82,550
8,475
91,025
Profit for the year

13,600

13,600
2,539
16,139

Net fair value loss on available for-sale financial assets

(103)

(103)

(103)

1,421

1,421

1,421
Other comprehensive income for
the year, net of tax

1,421
(103)

1,318

1,318
Total comprehensive income for

the year

13,600
1,421 (103)

14,918 2,539 17,457

Contributions by and

145 145
145

(3,660)

(3,660)

(3,660)
Dividends payable

(984)
(984)
Treasury shares transferred on
vesting of restricted share

grant

219
(238) 19

Total transactions with owners in
their capacity as owners

219
(3,660)

(93)

19
(3,515)
(984)
(4,499)

At 31 December 2013
33,303
(187)
57,499
2,757
666
111
286
(657)
175
93,953
10,030 103,983

Premium

paid

Fair
Share
on

value
based acquisition

Non-con2013
lation
ment
trolling Total
Group
fund

$000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000


Share based

compen
Share
Treasury
Accumulated
sation
Capital
Total

capital
shares
profits
reserve
reserve
equity

$000 $000 $000 $000 $000 $000

(Note 27)
(Note 27)
(Note 28)
(Note 28)
(Note 28)
2013
Company
1 January 2013
Profit for the year
Total comprehensive income

for the year
At 31 December 2013
1 January 2014
Profit for the year

for the year
33,303

33,303
33,303

(406)

(187)
(187)

(5,127)
11,946
11,946
Treasury shares transferred
on vesting of restricted
share grant

219

(3,660)
Total transactions with

owners in their capacity as
owners

219
(3,660)
3,159
379

156

28,305
11,946

11,946
145

145
(238)

19

(3,660)
19
(3,515)
(93)
286
175
36,736
2014
Company
3,159
10,920
286

175

36,736
10,920
10,920

10,920

650 (1) 305 955
share grant

103

(235)
132

(569)

(569)

(5,071)

(5,071)

Total transactions with
owners in their capacity as
owners

184
(5,071)
70
132
(4,685)

At 31 December 2014
33,303
(3)
9,008
356
307
42,971

(1) Refers to 488,764 treasury shares released to Mr. Oh Eng Lock, the Group Chief Executive Officer, as an award of service
quality.
61
C O N S O L I D AT E D C A S H F L O W S T AT E M E N T

Notes 2014 2013

$000
$000

Cash flows from operating activities
22,813
22,390
Adjustments for:
Amortisation of intangible assets
12
442
489
Depreciation of property, plant and equipment
10
45,495
38,849
Gain on disposal of intangible assets

(11)
Gain on disposal of property, plant and equipment
(1,001)
(111)
Gain on a disposal of a joint venture
(27)
Write back of provision for reinstatement cost

(92)
(394)
Impairment loss on investment securities
13
75
Impairment loss on property, plant and equipment

10

824
Impairment of trade receivables
137
197
Impairment of other receivables

26
Impairment of amount due from joint venture
52
607
Other receivables written off
111
Interest expense
3,728
2,675
Interest income
(2,058)
(1,316)
Property, plant and equipment written off
3,135
743
Share based payment expenses
955
146
Share of results of associates
1,085
(231)
Share of results of joint ventures
(645)
(595)
Write-off of inventories
12
Dividend income from unquoted investment equity

(411)
Unrealised exchange loss / (gain), net

437
(1,115)
Operating cash flows before working capital changes 74,243 63,173
Increase in:
Inventories
(637)
(992)
(3,323)
(8,319)
Prepayments
612
(71)
Amount due from joint ventures (trade)
(139)
278
Increase in:
(600)
10,400
Other liabilities
9,734
14,019
Amount due to a joint venture (trade)
364
496

Cash flows generated from operations
80,254
78,984
Tax paid
(6,929)
(7,545)
Net cash flows from operating activities 73,325 71,439


Notes 2014 2013

$000
$000

Cash flows from investing activities
Interest income received
578
2,070
Purchase of property, plant and equipment
A
(47,482)
(106,441)
Additions to intangible assets
(337)
(219)
Purchase of investment property
(23,153)
Cash paid for reinstatement expenses

(792)
(375)
Proceeds from disposal of property, plant and equipment
4,549
271
Proceeds from disposal of assets of disposal group classified as
held for sale
2,056
Proceeds from disposal of a joint venture

27
Amount due from joint ventures (non-trade)

(138)
(138)
Amount due to joint ventures (non-trade)
(11)
Loan to a joint venture

(55)
Amount due to an associate (non-trade)
904
1,193
Investment in a joint venture
(5,044)
Investment in associates

(2,910)
Purchase of investment securities
(17,569)
(14,020)
Loan to an investee
(4,485)
Repayment of loan to an investee

3,788
Dividends received from an associate

450
Dividends received from a joint venture

334
208
Dividends received from unquoted investment equity
411
Cash under asset held for sale

21

(4)

Net cash flows used in investing activities
(85,914) (120,420)

Cash flows from financing activities
Interest paid
(3,728)
(2,675)
Dividends paid to shareholders of the Company
(5,071)
(3,660)
Dividends paid to minority shareholders of a subsidiary
(1,139)
(984)
(569)
Proceeds from long-term loans

40,739
73,831
Repayment of long-term loans
(18,691)
(32,314)
Proceeds from short-term loans
30,758
34,159
Repayment of short-term loans
(24,259)
(3,223)
Loan due to a minority shareholder
476
Repayment of amount due to landlord

(14)

Net cash flows from financing activities 18,516 65,120

Net increase/(decrease) in cash and cash equivalents
5,927 16,139
Effect of exchange rate changes on cash and cash equivalents
(984)
(964)
Cash and cash equivalents at the beginning of the year 79,420 64,245
Reclassification of long term fixed deposit due within 12 months
11,089

Cash and cash equivalents at the end of the year
20 95,452 79,420

63
N O T E S T O T H E F I N A N C I A L S T AT E M E N T S
Note A. Purchase of property, plant and equipment
1. General
During the year, the Group acquired property, plant and equipment with an aggregate cost of approximately $43,629,000 (2013:
$107,751,000). The additions were by way of cash payments of $30,705,000 (2013: $90,392,000), increase in provision for
reinstatement costs of $2,169,000 (2013: $2,926,000), in amount payable to other creditors of $9,334,000 (2013: $11,302,000
and accruals of $1,421,000 (2013: $3,131,000).
1.1 Corporate information
Cash outflow for the year also include payments in respect of property, plant and equipment acquired in the previous years of
$16,777,000 (2013: $16,049,000).
BreadTalk Group Limited (the Company) is a limited liability company incorporated and domiciled in the Republic of
Singapore and is listed on the Singapore Exchange Securities Trading Limited (SGX-ST).
The registered office and principal place of business of the Company is located at Breadtalk IHQ, 30 Tai Seng Street, #0901 Singapore 534013.
The principal activity of the Company is that of investment holding and provision of management services. The principal
activities of the subsidiaries are disclosed in Note 14 to the financial statements.
Related corporations comprise companies within the BreadTalk Group Limited group of companies, and include associates
and joint ventures.
2.
Summary of significant accounting policies
2.1 Basis of preparation and fundamental accounting assumption

As at 31 December 2014, the Groups and Companys current liabilities exceeded their current assets by $94,332,000
(2013: $64,822,000) and $9,434,000 (2013: $12,055,000) respectively. The ability of the Group to continue as a going
concern is dependent on the Groups ability to generate positive cash flows. In the opinion of the directors, the Group is
able to continue as a going concern despite its net current liabilities position as the directors are of the view that the
Group will be able to continue to generate net cash inflows from its operating activities for a period of 12 months from
the date these financial statements were approved and to enable it to meet its financial obligations as and when they fall
due. In addition, the Group has sufficient unutilised banking facilities available for future use should the need arise.
The consolidated financial statements of the Group and the balance sheet and statement of changes in equity of the
Company have been prepared in accordance with Singapore Financial Reporting Standards (FRS).
The financial statements have been prepared on the historical cost basis except as disclosed in the accounting
policies below.
The financial statements are presented in Singapore Dollars (SGD or $) and all values are rounded to the nearest
thousand ($000) except when otherwise indicated.
65
2. Summary of significant accounting policies (contd)
2.2 Changes in accounting policies
2.3 Standards issued but not yet effective (contd)
With the exception of FRS 115, the directors expect that the adoption of the other standards above will have no material
impact on the financial statements in the period of initial application.
FRS 115 was issued in November 2014 and establishes a new five-step model that will apply to revenue arising from
contracts with customers. Under FRS 115, revenue is recognised at an amount that reflects the consideration to which an
entity expects to be entitled in exchange for transferring goods or services to a customer. The principles in FRS 115
provide a more structured approach to measuring and recognising revenue. The new revenue standard is applicable to
all entities and will supersede all current revenue recognition requirements under FRS. Either a full or modified retrospective
application is required for annual periods beginning on or after 1 January 2017 with early adoption permitted. The Group
is currently assessing the impact of FRS 115 and plans to adopt the new standard on the required effective date.
The accounting policies adopted are consistent with those of the previous financial year except in the current financial
year, the Group has adopted all the new and revised standards which are effective for annual financial periods beginning
on or after 1 January 2014. The adoption of these standards did not have any effect on the financial performance or
position of the Group and the Company.
2.3 Standards issued but not yet effective

The Group has not adopted the following standards that have been issued but not yet effective:

Description

Amendments to FRS 19 Defined Benefit Plans: Employee
Contributions

Improvements to FRSs (January 2014)

(a) Amendments to FRS 102 Share Based Payment

(b) Amendments to FRS 103 Business Combinations

(c) Amendments to FRS 108 Operating Segments

(d) Amendments to FRS 16 Property, Plant and Equipment and
FRS 38 Intangible Assets

(e) Amendments to FRS 24 Related Party Disclosures

Improvements to FRSs (February 2014)

(a) Amendments to FRS 103 Business Combinations

(b) Amendments to FRS 113 Fair Value Measurement

(c) Amendments to FRS 40 Investment Property

Amendments to FRS 27 Equity Method in Separate Financial Statements

Amendments to FRS 16 and FRS 38: Clarification of Acceptable
Methods of Depreciation and Amortisation

Amendments to FRS 111: Accounting for Acquisitions of Interests
in Joint Operations

Improvements to FRSs (November 2014)

(a) FRS 105 Non-current Assets Held for Sale and Discontinued
Operations

(b) FRS 107 Financial Instruments: Disclosures

(c) FRS 19 Employee Benefits

(d) FRS 34 Interim Financial Reporting

Amendments to FRS 110 & FRS 28 Sale or Contribution of Assets
between an Investor and its Associate or Joint Venture

Amendments to FRS 1: Disclosure Initiative

Amendments to FRS 110, FRS 112 and FRS 28: Investment
Entities: Applying the Consolidation Exception

FRS 115 Revenue from Contracts with Customers

FRS 109 Financial Instruments

Effective for
annual periods
beginning on or
after
1 July 2014
1 July 2014
1 July 2014
1 July 2014
1 July 2014
1 July 2014
1 July 2014
1 July 2014
1 July 2014
1 January 2016
1 January 2016
1 January 2016
1 January 2016
1 January 2016
1 January 2016
1 January 2016
2.4 Significant accounting estimates and judgements

The preparation of the Groups consolidated financial statements requires management to make judgements, estimates
and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the disclosure of
contingent liabilities at the end of each reporting period. However, uncertainty about these assumptions and estimates
could result in outcomes that could require a material adjustment to the carrying amount of the asset or liability affected
in the future periods.
Judgements made in applying accounting policies
In the process of applying the Groups accounting policies, management has made the following judgements, apart from
those involving estimations, which have the most significant effect on the amounts recognised in the consolidated financial
statements:
(a)
Impairment of available-for-sale investments and held-to-maturity investments

The Group records impairment charges on available-for-sale equity investments when there has been a significant or
prolonged decline in the fair value below their cost. The determination of what is significant or prolonged requires
judgement. In making this judgement, the Group evaluates, among other factors, historical share price movements and
the duration and extent to which the fair value of an investment is less than its cost.
The Group assesses whether there is an indication that held-to-maturity investments may be impaired. In the
assessment, the Group evaluates, among other factors, the cash flow projections and value of the related secured
property.

1 January 2016
1 January 2016
1 January 2016
1 January 2017
1 January 2018
67
2.4 Significant accounting estimates and judgements (contd)
2.4 Significant accounting estimates and judgements (contd)
(b)
Income taxes

The Group has exposure to income taxes in numerous jurisdictions. Significant judgement is involved in determining
the Group-wide provision for income taxes. There are certain transactions and computations for which the ultimate
tax determination is uncertain during the ordinary course of business. The Group recognises liabilities for expected
tax issues based on estimates of whether additional taxes will be due. Where the final tax outcome of these matters
is different from the amounts that were initially recognised, such differences will impact the income tax and deferred
tax provisions in the period in which such determination is made. The carrying amount of the Groups tax payable
and deferred tax liabilities at 31 December 2014 were approximately $6,825,000 (2013: $6,458,000) and $2,619,000
(2013: $2,554,000) respectively. The carrying amount of the Groups tax recoverable and deferred tax assets at 31
December 2014 was $8,000 (2013: $6,000) and $4,970,000 (2013: $4,287,000) respectively.
A subsidiary, BreadTalk Pte Ltd obtained the Development and Expansion Incentive (DEI) which entitles the qualifying
income of the company earned up to the financial year ended 31 December 2018 to be subject to the concessionary
tax rate of 10%. Judgement is involved when determining the amount of qualifying income for the year.

Key sources of estimation uncertainty
The key assumptions concerning the future and other key sources of estimation uncertainty at the end of the reporting
period are discussed below. The Group based its assumptions and estimates on parameters available when the financial
statements were prepared. Existing circumstances and assumptions about future developments, however, may change due
to market changes or circumstances arising beyond the control of the Group. Such changes are reflected in the assumptions
when they occur.
(a)
Impairment of goodwill

(b)
Valuation and estimated useful life of brand value arising from acquisition of a subsidiary, Topwin Investment Holding
Pte Ltd (Topwin)
Brand value arising from the acquisition of Topwin was separately identified and recognised by management using the
relief from royalty method. The premise of this valuation method is the assumption that the Group would be
compelled to pay the rightful owner of the brand name if the Group did not have the legal right to utilise the brand
name. The ownership of the brand therefore relieves the Group from making such royalty payments. This requires an
estimation of the royalty payments including initial fees and continuing royalty payments based on a percentage of
projected revenue.The basis used to determine the revenue projections is the revenue for each food court of Topwin
achieved in the financial year ended 31 December 2004 projected into the future. The useful life of the brand value is
estimated by the directors to be 15 years as this is the length of time that they expect the benefits of the brand
to flow to the Group. Amortisation of the brand amounted to $213,000 (2013: $214,000) for the financial year ended
31 December 2014 and the carrying amount of the brand value at 31 December 2014 was $1,066,000 (2013:
$1,279,000). More details are given in Note 12.
(c)
Provision for reinstatement cost

The Group recognises provision for reinstatement cost when the Group entered into a lease agreement for the
premises. In determining the amount of the provision for reinstatement cost, estimates are made in relation to the
expected cost to reinstate the premises back to its original form after the expiration of the lease terms. The carrying
amount of the provision for reinstatement cost as at 31 December 2014 was $11,681,000 (2013: $10,223,000). If the
estimated provision had been 5% higher/lower than managements estimate, the carrying amount of the provision
would have been $584,000 (2013: $511,000) higher/lower.
The Group determines whether goodwill is impaired at least on an annual basis. This requires an estimation of the
value in use of the cash-generating units to which the goodwill are allocated. Estimating the value in use requires the
Group to make an estimate of the expected future cash flows from the cash-generating unit and also to choose a
suitable discount rate in order to calculate the present value of those cash flows. The carrying amount of the Groups
goodwill at 31 December 2014 was $5,846,000 (2013: $5,846,000). More details are given in Note 12.
69
2.5 Foreign currency
2.6 Basis of consolidation and business combinations
The financial statements are presented in Singapore Dollars, which is also the Companys functional currency. Each entity
in the Group determines its own functional currency and items included in the financial statements of each entity are
measured using that functional currency.
(a)
Transactions and balances
Transactions in foreign currencies are measured in the respective functional currencies of the Company and its
subsidiaries and are recorded on initial recognition in the functional currencies at exchange rates approximating those
ruling at the transaction dates. Monetary assets and liabilities denominated in foreign currencies are translated at the
rate of exchange ruling at the balance sheet date. Non-monetary items that are measured in terms of historical
cost in a foreign currency are translated using the exchange rates as at the dates of the initial transactions. Non monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when
the fair value was measured.
Exchange differences arising on the settlement of monetary items or on translating monetary items at the end of the
reporting period are recognised in profit or loss.
(b)
Consolidated financial statements
For consolidation purpose, the assets and liabilities of foreign operations are translated into SGD at the rate of
exchange ruling at the balance sheet date and their profit or loss are translated at the exchange rates prevailing at the
date of the transactions. The exchange differences arising on the translation are recognised in other comprehensive
income. On disposal of a foreign operation, the component of other comprehensive income relating to that particular
foreign operation is recognised in profit or loss.
(a) Basis of consolidation
The consolidated financial statements comprise the financial statements of the Company and its subsidiaries as at the
end of the reporting period. The financial statements of the subsidiaries used in the preparation of the consolidated
financial statements are prepared for the same reporting date as the Company. Consistent accounting policies are
applied to like transactions and events in similar circumstances.
All intra-group balances, income and expenses and unrealised gains and losses resulting from intra-group transactions
and dividends are eliminated in full.
Subsidiaries are consolidated from the date of acquisition, being the date on which the Group obtains control, and
continue to be consolidated until the date that such control ceases.
Losses within a subsidiary are attributed to the non-controlling interest even if that results in a deficit balance.
A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction.
If the Group loses control over a subsidiary, it:

De-recognises the assets (including goodwill) and liabilities of the subsidiary at their carrying amounts at the date
when control is lost;
De-recognises the carrying amount of any non-controlling interest;
De-recognises the cumulative translation differences recorded in equity;
Recognises the fair value of the consideration received;
Recognises the fair value of any investment retained;
Recognises any surplus or deficit in profit or loss;
Re-classifies the Groups share of components previously recognised in other comprehensive income to profit or
loss or retained earnings, as appropriate.
(b) Business combinations and goodwill
Business combinations are accounted for by applying the acquisition method. Identifiable assets acquired and liabilities
assumed in a business combination are measured initially at their fair values at the acquisition date. Acquisition related costs are recognised as expenses in the periods in which the costs are incurred and the services are received.
Any contingent consideration to be transferred by the acquirer will be recognised at fair value at the acquisition
date. Subsequent changes to the fair value of the contingent consideration which is deemed to be an asset or liability,
will be recognised in profit or loss.
71
2.6 Basis of consolidation and business combinations (contd)
2.8 Subsidiaries
A subsidiary is an investee that is controlled by the Group. The Group controls an investee when it is exposed, or has
rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its
power over the investee.
In the Companys separate financial statements, investments in subsidiaries are accounted for at cost less impairment
losses.
(b) Business combinations and goodwill (contd)
The Group elects for each individual business combination, whether non-controlling interest in the acquiree (if any),
that are present ownership interests and entitle their holders to a proportionate share of net assets in the event of
liquidation, is recognised on the acquisition date at fair value, or at the non-controlling interests proportionate share
of the acquirees identifiable net assets. Other components of non-controlling interests are measured at their
acquisition date fair value, unless another measurement basis is required by another FRS.
Any excess of the sum of the fair value of the consideration transferred in the business combination, the amount of
non-controlling interest in the acquiree (if any), and the fair value of the Groups previously held equity interest in the
acquiree (if any), over the net fair value of the acquirees identifiable assets and liabilities is recorded as goodwill. In
instances where the latter amount exceeds the former, the excess is recognised as gain on bargain purchase in profit
or loss on the acquisition date.
Goodwill is initially measured at cost. Following initial recognition, goodwill is measured at cost less any accumulated
impairment losses.
For the purpose of impairment testing, goodwill acquired in a business combination is, from the acquisition date,
allocated to the Groups cash-generating units that are expected to benefit from the synergies of the combination,
irrespective of whether other assets or liabilities of the acquiree are assigned to those units.
The cash-generating units to which goodwill have been allocated is tested for impairment annually and whenever
there is an indication that the cash-generating unit may be impaired. Impairment is determined for goodwill by
assessing the recoverable amount of each cash-generating unit (or group of cash-generating units) to which the
goodwill relates.
2.9 Joint arrangements

A joint arrangement is a contractual arrangement whereby two or more parties have joint control. Joint control is the
contractually agreed sharing of control of an arrangement, which exists only when decisions about the relevant activities
require the unanimous consent of the parties sharing control.
A joint arrangement is classified either as joint operation or joint venture, based on the rights and obligations of the
parties to the arrangement.
To the extent the joint arrangement provides the Group with rights to the assets and obligations for the liabilities relating
to the arrangement, the arrangement is a joint operation. To the extent the joint arrangement provides the Group with
rights to the net assets of the arrangement, the arrangement is a joint venture.
(a)
Joint operations
The Group recognises in relation to its interest in a joint operation,
(a) its assets, including its share of any assets held jointly;
2.7 Transactions with non-controlling interests
(b) its liabilities, including its share of any liabilities incurred jointly;
Non-controlling interests represent the equity in subsidiaries not attributable, directly or indirectly, to owners of
the Company.
(c) its revenue from the sale of its share of the output arising from the joint operation;
Changes in the Company ownership interest in a subsidiary that do not result in a loss of control are accounted for as
equity transactions. In such circumstances, the carrying amounts of the controlling and non-controlling interests are
adjusted to reflect the changes in their relative interests in the subsidiary. Any difference between the amount by which
the non-controlling interest is adjusted and the fair value of the consideration paid or received is recognised directly in
equity and attributable to owners of the Company.
(d) its share of the revenue from the sale of the output by the joint operation; and

(e) its expenses, including its share of any expenses incurred jointly.
The Group accounts for the assets, liabilities, revenues and expenses relating to its interest in a joint operation in
accordance with the accounting policies applicable to the particular assets, liabilities, revenues and expenses.
(b)
Joint ventures
The Group recognises its interest in a joint venture as an investment and accounts for the investment using the equity
method. The accounting policy for investment in joint venture is set out in Note 2.10.
73
2.10 Associates and joint ventures

An associate is an entity over which the Group has the power to participate in the financial and operating policy decisions
of the investee but does not have control or joint control of those policies.
The Group account for its investments in associates and joint ventures using the equity method from the date on which
it becomes an associate or joint venture.
On acquisition of the investment, any excess of the cost of the investment over the Groups share of the net fair value of
the investees identifiable assets and liabilities is accounted as goodwill and is included in the carrying amount of the
investment. Any excess of the Groups share of the net fair value of the investees identifiable assets and liabilities over the
cost of the investment is included as income in the determination of the entitys share of the associate or joint ventures
profit or loss in the period in which the investment is acquired.
Under the equity method, the investment in associates or joint ventures are carried in the balance sheet at cost plus postacquisition changes in the Groups share of net assets of the associates or joint ventures. The profit or loss reflects the
share of results of the operations of the associates or joint ventures. Distributions received from joint ventures or
associates reduce the carrying amount of the investment.Where there has been a change recognised in other comprehensive
income by the associates or joint venture, the Group recognises its share of such changes in other comprehensive income.
Unrealised gains and losses resulting from transactions between the Group and associate or joint venture are eliminated
to the extent of the interest in the associates or joint ventures.
When the Groups share of losses in an associate or joint venture equals or exceeds its interest in the associate or joint
venture, the Group does not recognise further losses, unless it has incurred obligations or made payments on behalf of
the associate or joint venture.
After application of the equity method, the Group determines whether it is necessary to recognise an additional
impairment loss on the Groups investment in associate or joint ventures. The Group determines at the end of each
reporting period whether there is any objective evidence that the investment in the associate or joint venture is impaired.
If this is the case, the Group calculates the amount of impairment as the difference between the recoverable amount of
the associate or joint venture and its carrying value and recognises the amount in profit or loss.
The financial statements of the associates and joint ventures are prepared as the same reporting date as the Company.
Where necessary, adjustments are made to bring the accounting policies in line with those of the Group.
2.11 Property, plant and equipment

All items of property, plant and equipment are initially recorded at cost. Subsequent to recognition, property, plant and
equipment other than freehold land and buildings are measured at cost less accumulated depreciation and any
accumulated impairment losses. The cost includes the cost of replacing part of the property, plant and equipment and
borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying property,
plant and equipment. The accounting policy for borrowing costs is set out in Note 2.21. The cost of an item of property,
plant and equipment is recognised as an asset if, and only if, it is probable that future economic benefits associated with
the item will flow to the Group and the cost of the item can be measured reliably.
Subsequent to recognition, property, plant and equipment are stated at cost less accumulated depreciation and any
accumulated impairment losses. When significant parts of property, plant and equipment are required to be replaced
in intervals, the Group recognises such parts as individual assets with specific useful lives and depreciation, respectively.
Likewise, when a major inspection is performed, its cost is recognised in the carrying amount of the plant and equipment
as a replacement if the recognition criteria are satisfied. All other repair and maintenance costs are recognised in profit or
loss as incurred.
Depreciation of an asset begins when it is available for use and is computed on a straight-line basis over the estimated
useful life of the asset as follows:
Leasehold property
Leasehold land
Machinery and equipment
Electrical works
Furniture and fittings
Office equipment
Renovation
Motor vehicles
Assets under construction included in plant and equipment are not depreciated as these assets are not yet available
for use.
The carrying values of property, plant and equipment are reviewed for impairment when events or changes in circumstances
indicate that the carrying value may not be recoverable.
The residual values, useful life and depreciation method are reviewed at each financial year-end to ensure that the amount,
method and period of depreciation are consistent with previous estimates and the expected pattern of consumption of
the future economic benefits embodied in the items of property, plant and equipment.
An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are
expected from its use or disposal. Any gain or loss arising on derecognition of the asset is included in profit or loss in the
year the asset is derecognised.
20 57 years
57 years
5 - 20 years
5 - 6 years
5 - 6 years
3 - 6 years
2 - 6 years
5 - 6 years
75
2.12 Investment properties
2.13 Intangible assets (contd)
Investment properties are properties that are either owned by the Group or leased under a finance lease that are held
to earn rentals or for capital appreciation, or both, rather than for use in the production or supply of goods or services,
or for administrative purposes, or in the ordinary course of business. Investment properties comprise completed
investment properties and properties that are being constructed or developed for future use as investment properties.
Properties held under operating leases are classified as investment properties when the definition of an investment
property is met.
(a)
Trade mark
Investment properties are initially measured at cost, including transaction costs. The cost of investment properties are
recognised as assets if, and only if, it is probable that future economic benefits associated with the property will flow to
the Group and the cost of the property can be measured reliably.
Costs relating to master franchise fees paid are capitalised and amortised on a straight-line basis over the lease/
franchise period ranging from 4 to 20 years.
Subsequent to initial recognition, investment properties are stated at cost less accumulated depreciation and any
accumulated impairment losses.
Costs relating to territory reservation fees are capitalised and amortised on a straight line basis over the useful life
of 6 years.
Depreciation of investment properties begin when they are available for use and are computed on a straight-line basis
over the estimated useful life of the asset. The useful life of the investment property is 47 years.
Investment properties are derecognised when either they have been disposed of or when the investment property is
permanently withdrawn from use and no future economic benefit is expected from its disposal. Any gains or losses on
the retirement or disposal of an investment property are recognised in profit or loss in the year of retirement or disposal.
2.13 Intangible assets

Intangible assets acquired separately are measured initially at cost. Following initial acquisition, intangible assets are carried
at cost less any accumulated amortisation and any accumulated impairment losses. Internally generated intangible assets,
excluding capitalised development costs, are not capitalised and expenditure is reflected in profit or loss in the year in
which the expenditure is incurred.
The useful lives of intangible assets are assessed as either finite or indefinite.
Intangible assets with finite useful lives are amortised over the estimated useful lives and assessed for impairment whenever
there is an indication that the intangible asset may be impaired. The amortisation period and the amortisation method
are reviewed at least at each financial year-end. Changes in the expected useful life or the expected pattern of consumption
of future economic benefits embodied in the asset is accounted for by changing the amortisation period or method, as
appropriate, and are treated as changes in accounting estimates.
Intangible assets with indefinite useful lives or not yet available for use are tested for impairment annually, or more
frequently if the events and circumstances indicate that the carrying value may be impaired either individually or at the
cash-generating unit level. Such intangible assets are not amortised. The useful life of an intangible asset with an indefinite
useful life is reviewed annually to determine whether the useful life assessment continues to be supportable. If not, the
change in useful life from indefinite to finite is made on a prospective basis.
Gains or losses arising from de-recognition of an intangible asset are measured as the difference between the net disposal
proceeds and the carrying amount of the asset and are recognised in profit or loss when the asset is derecognised.
Costs relating to trade mark are capitalised and amortised on a straight-line basis over its estimated finite useful life
of 5 years.
(b)
Franchise rights
(c)
Location premium

Consideration paid to previous tenants to vacate premises in order to secure the lease arrangement are amortised
on a straight-line basis over the new lease agreement period of 4 years.
(d)
Brand value

Brand value was acquired through a business combination. The useful life of the brand is assessed to be finite and
estimated to be 15 years because this is the length of time that the management expects the economic benefits of
the brand to flow to the Group.
Brand value is amortised on a straight-line basis over its estimated economic useful life.
2.14 Impairment of non-financial assets

The Group assesses at each reporting date whether there is an indication that an asset may be impaired. If any
indication exists, or when an annual impairment testing for an asset is required, the Group makes an estimate of the
assets recoverable amount.
An assets recoverable amount is the higher of an assets or cash-generating units fair value less costs to sell and
its value in use and is determined for an individual asset, unless the asset does not generate cash inflows that are largely
independent of those from other assets or groups of assets. Where the carrying amount of an asset or cash-generating
unit exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.
Impairment losses of continuing operations are recognised in profit or loss.
A previously recognised impairment loss is reversed only if there has been a change in the estimates used to determine
the assets recoverable amount since the last impairment loss was recognised. If that is the case, the carrying amount
of the asset is increased to its recoverable amount. That increase cannot exceed the carrying amount that would have
been determined net of depreciation, had no impairment loss been recognised previously. Such reversal is recognised in
profit or loss.
77
2.15 Financial instruments
2.15 Financial Instruments (contd)
(a)
Financial assets
(a)
Financial assets (contd)
Initial recognition and measurement
(iii)
Available-for-sale financial assets (contd)
Financial assets are recognised when, and only when, the Group becomes a party to the contractual provisions of
the financial instrument. The Group determines the classification of its financial assets at initial recognition.
When financial assets are recognised initially, they are measured at fair value, plus, in the case of financial assets not
at fair value through profit or loss, directly attributable transaction costs.
After initial recognition, available-for-sale financial assets are subsequently measured at fair value. Any gains
or losses from changes in fair value of the financial assets are recognised in other comprehensive income,
except that impairment losses, foreign exchange gains and losses on monetary instruments and interest
calculated using the effective interest method are recognised in profit or loss. The cumulative gain or loss
previously recognised in other comprehensive income is reclassified from equity to profit or loss as a
reclassification adjustment when the financial asset is derecognised.
Investments in equity instruments whose fair value cannot be reliably measured are measured at cost less
impairment loss.
Subsequent measurement

The subsequent measurement of financial assets depends on their classification as follows:
(i)
Loans and receivables
Derecognition
Non-derivative financial assets with fixed or determinable payments that are not quoted in an active market
are classified as loans and receivables. Subsequent to initial recognition, loans and receivables are measured at
amortised cost using the effective interest method, less impairment. Gains and losses are recognised in profit
or loss when the loans and receivables are derecognised or impaired, and through the amortisation process.
A financial asset is derecognised where the contractual right to receive cash flows from the asset has
expired. On derecognition of a financial asset in its entirety, the difference between the carrying amount and
the sum of the consideration received and any cumulative gain or loss that had been recognised in other
comprehensive income is recognised in profit or loss.
(ii)
Held-to-maturity investments
(b)
Financial liabilities
Initial recognition and measurement
Non-derivative financial assets with fixed or determinable payments and fixed maturity are classified as
held-to-maturity when the Group has the positive intention and ability to hold the investment to maturity.
Subsequent to initial recognition, held-to-maturity investments are measured at amortised cost using the
effective interest method, less impairment. Gains and losses are recognised in profit or loss when the held-tomaturity investments are derecognised or impaired, and through the amortisation process.
(iii)
Available-for-sale financial assets

Available-for-sale financial assets include equity and debt securities. Equity investments classified as availablefor-sale are those, which are neither classified as held for trading nor designated at fair value through profit or
loss. Debt securities in this category are those which are intended to be held for an indefinite period of time
and which may be sold in response to needs for liquidity or in response to changes in market conditions.

All financial liabilities are recognised initially at fair value plus in the case of financial liabilities not at fair value through

profit or loss, directly attributable transaction costs.

Subsequent measurement

After initial recognition, financial liabilities that are not carried at fair value through profit or loss are subsequently
measured at amortised cost using the effective interest method. Gains and losses are recognised in profit or loss when
the liabilities are derecognised, and through the amortisation process.
Derecognition

Financial liabilities are recognised when, and only when, the Group becomes a party to the contractual provisions of the
financial instrument. The Group determines the classification of its financial liabilities at initial recognition.
A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expired. When
an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms
of an existing liability are substantially modified, such an exchange or modification is treated as a derecognition of
the original liability and the recognition of a new liability, and the difference in the respective carrying amounts is
recognised in profit or loss.
79
2.16 Impairment of financial assets
2.16 Impairment of financial assets (contd)
(c)
The Group assesses at each balance sheet date whether there is any objective evidence that a financial asset is impaired.
(a)
Financial assets carried at amortised cost

For financial assets carried at amortised cost, the Group first assesses whether objective evidence of impairment
exists individually for financial assets that are individually significant, or collectively for financial assets that are not
individually significant. If the Group determines that no objective evidence of impairment exists for an individually
assessed financial asset, whether significant or not, it includes the asset in a group of financial assets with similar credit
risk characteristics and collectively assesses them for impairment. Assets that are individually assessed for impairment
and for which an impairment loss is, or continues to be recognised are not included in a collective assessment of
impairment.
If there is objective evidence that an impairment loss on financial assets carried at amortised cost has been incurred,
the amount of the loss is measured as the difference between the assets carrying amount and the present value of
estimated future cash flows discounted at the financial assets original effective interest rate. If a loan has a variable
interest rate, the discount rate for measuring any impairment loss is the current effective interest rate. The carrying
amount of the asset is reduced through the use of an allowance account. The impairment loss is recognised in profit
or loss.
When the asset becomes uncollectible, the carrying amount of the impaired financial asset is reduced directly or if an
amount was charged to the allowance account, the amount charged to the allowance account is written off against
the carrying value of the financial asset.
To determine whether there is objective evidence that an impairment loss on financial assets has been incurred, the
Group considers factors such as the probability of insolvency or significant financial difficulties of the debtor and
default or significant delay in payments.
If in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively
to an event occurring after the impairment was recognised, the previously recognised impairment loss is reversed
to the extent that the carrying amount of the asset does not exceed its amortised cost at the reversal date. The
amount of reversal is recognised in profit or loss.
(b)
Financial assets carried at cost

If there is objective evidence (such as significant adverse changes in the business environment where the issuer
operates, probability of insolvency or significant financial difficulties of the issuer) that an impairment loss on financial
asset carried at cost has been incurred, the amount of the loss is measured as the difference between the assets
carrying amount and the present value of estimated future cash flows discounted at the current market rate of return
for a similar financial asset. Such impairment losses are not reversed in subsequent periods.
In the case of equity instruments classified as available-for sale, objective evidence of impairment include (i) significant
financial difficulty of the issuer or obligor, (ii) information about significant changes with an adverse effect that have
taken place in the technological, market, economic or legal environment in which the issuer operates, and indicates
that the cost of the investment in equity instrument may not be recovered; and (iii) a significant or prolonged decline
in the fair value of the investment below its costs. Significant is to be evaluated against the original cost of the
investment and prolonged against the period in which the fair value has been below its original cost.
If an available-for-sale financial asset is impaired, an amount comprising the difference between its acquisition cost (net
of any principal repayment and amortisation) and its current fair value, less any impairment loss previously recognised
in profit or loss, is transferred from other comprehensive income and recognised in profit or loss.
Reversals of impairment losses in respect of equity instruments are not recognised in profit or loss; increase in their
fair value after impairment are recognised directly in other comprehensive income.
2.17 Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and at bank and unpledged short-term fixed deposits.
2.18 Inventories

Inventories comprise raw materials, consumables, semi-finished goods, finished goods and base inventories.
Inventories are valued at the lower of cost and net realisable value. Costs comprise purchase costs accounted for on a
weighted average cost basis. In the case of semi-finished goods, costs also include an appropriate share of production
overheads based on normal operating capacity.
Base inventory, comprising mainly cutlery and dining utensils, are written down to 50% of the original cost and all further
replacement costs incurred in maintaining the base inventory is expensed.
Where necessary, allowance is provided for damaged, obsolete and slow moving items to adjust the carrying value of
inventories to the lower cost and net realisable value.
Net realisable value is the estimated selling price in the ordinary course of business, less estimated costs of completion
and the estimated costs necessary to make the sale.
81
2.19 Provisions
2.22 Leases (contd)
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is
probable that an outflow of resources embodying economic benefits will be required to settle the obligation and the
amount of the obligation can be estimated reliably.
(a)
As lessee (contd)
Provisions are reviewed at each balance sheet date and adjusted to reflect the current best estimate. If it is no longer
probable that an outflow of resources embodying economic benefits will be required to settle the obligation, the provision
is reversed. If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that
reflects, where appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to
the passage of time is recognised as a finance cost.
2.20 Financial guarantee

A financial guarantee contract is a contract that requires the issuer to make specified payments to reimburse the holder
for a loss it incurs because a specified debtor fails to make payment when due in accordance with the terms of a debt
instrument.
Financial guarantees are recognised initially as a liability at fair value, adjusted for transaction costs that are directly
attributable to the issuance of the guarantee. Subsequent to initial recognition, financial guarantees are recognised as
income in profit or loss over the period of the guarantee. If it is probable that the liability will be higher than the amount
initially recognised less amortisation, the liability is recorded at the higher amount with the difference charged to profit
or loss.
2.21 Borrowing costs

Borrowing costs are capitalised as part of the cost of a qualifying asset if they are directly attributable to the acquisition,
construction or production of that asset.
Capitalisation of borrowing costs commences when the activities to prepare the asset for its intended use or sale
are in progress and the expenditures and borrowing costs are incurred. Borrowing costs are capitalised until the assets
are substantially completed for their intended use or sale. All other borrowing costs are expensed in the period they occur.
Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds.
2.22 Leases
(a)
As lessee

Finance leases, which transfer to the Group substantially all the risks and rewards incidental to ownership of the
leased item, are capitalised at the inception of the lease at the fair value of the leased asset or, if lower, at the present
value of the minimum lease payments. Any initial direct costs are also added to the amount capitalised. Lease
payments are apportioned between the finance charges and reduction of the lease liability so as to achieve a constant
rate of interest on the remaining balance of the liability. Finance charges are charged to profit or loss. Contingent
rents, if any, are charged as expenses in the periods in which they are incurred.
Capitalised leased assets are depreciated over the shorter of the estimated useful life of the asset and the lease term,
if there is no reasonable certainty that the Group will obtain ownership by the end of the lease term.
Operating lease payments are recognised as an expense in profit or loss on a straight-line basis over the lease term.
The aggregate benefit of incentives provided by the lessor is recognised as a reduction of rental expense over the
lease term on a straight-line basis.
(b)
As lessor

Leases where the Group retains substantially all the risks and rewards of ownership of the asset are classified as
operating leases. Initial direct costs incurred in negotiating an operating lease are added to the carrying amount of the
leased asset and recognised over the lease term on the same bases as rental income. The accounting policy for rental
income is set out in Note 2.25(g). Contingent rents are recognised as revenue in the period in which they are earned.
2.23 Employee benefits

(a)
Defined contribution plans

The Group participates in the national pension schemes as defined by the laws of the countries in which it has
operations. Contributions to national pension schemes are recognised as an expense in the period in which the
related services are performed.
Singapore

The Group makes contributions to the Central Provident Fund (CPF) scheme in Singapore, a defined contribution
pension scheme. The Group makes monthly contributions based on stipulated contribution rates.
Peoples Republic of China (PRC)

Subsidiaries incorporated and operating in the PRC are required to provide certain staff pension benefits to
their employees under existing PRC regulations. Contributions are provided at rates stipulated by PRC regulations
and are contributed to a pension fund managed by government agencies, which are responsible for administering
these amounts for the subsidiaries PRC employees.
Hong Kong

Subsidiaries incorporated and operating in Hong Kong pay contributions to publicly or privately administered pension
insurance plans on a mandatory basis. The subsidiaries have no further payment obligations once the contributions
have been paid. The contributions are not reduced by contributions forfeited by those employees who leave the
scheme prior to vesting fully in the contributions. Prepaid contributions are recognised as an asset to the extent that
a cash refund or a reduction in the future payments is available.
83
2.23 Employee benefits (contd)
2.25 Revenue
(b)
Employee leave entitlement
Employee entitlements to annual leave are recognized as a liability when they accrue to the employees.The estimated
liability for leave is recognised for services rendered by employees up to balance sheet date.
(c)
The BreadTalk Restricted Share Grant Plan (RSG Plan)

Employees receive remuneration under the RSG Plan in the form of fully-paid shares (Awards) of the Company as
consideration for services rendered. The cost of these equity-settled transactions with employees is measured by
reference to the fair value of the Awards at the date on which the Awards are granted. The cumulative expense
recognized at each reporting date until the vesting date reflects the Companys best estimate of the number of
Awards that will ultimately vest. The charge or credit to profit or loss for a period represents the movement in
cumulative expense recognised as at the beginning and end of that period.
In the Companys separate financial statements, the fair value of the Awards granted to employees of its subsidiaries
is recognised as an increase in the cost of the Companys investment in subsidiaries, with a corresponding increase
in equity.
2.24 Non-current assets held for sale

Non-current assets and disposal groups classified as held for sale are measured at the lower of their carrying amount and
fair value less costs to sell. Non-current assets and disposal groups are classified as held for sale if their carrying amounts
will be recovered principally through a sale transaction rather than through continuing use. This condition is regarded as
met only when the sale is highly probable and the asset or disposal group is available for immediate sale in its present
condition. Management must be committed to the sale, which should be expected to qualify for recognition as a completed
sale within one year from the date of classification.
Property, plant and equipment and intangible assets once classified as held for sale are not depreciated or amortised.
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue
can be reliably measured, regardless of when the payment is made. Revenue is measured at the fair value of consideration
received or receivable, taking into account contractually defined terms of payment and excluding taxes or duty. The Group
assesses its revenue arrangements to determine if it is acting as principal or agent. The Group has concluded that it is
acting as a principal in all of its revenue arrangements. The following specific recognition criteria must also be met before
revenue is recognised:
(a)
Bakery sales, restaurant sales and sales to franchisee

Revenue from the sale of goods is recognised upon the transfer of significant risk and rewards of ownership of
the goods to the customer, usually on delivery of goods. Revenue is not recognised to the extent where there are
significant uncertainties regarding recovery of the consideration due, associated costs or the possible return of goods.
(b)
Franchise income

Initial franchise income is recognised upon the grant of rights, completion of the designated phases of the franchise

setup and transfer of know-how to the franchisee in accordance with the terms stated in the franchise agreement.

Recurring franchise income is recognised on a periodic basis as a percentage of the franchisees revenue in accordance

with terms as stated in the franchise agreement.
(c)
Food court revenue

Fixed rental income from the sub-lease of food courts is recognised as income in profit or loss on a straight line basis
over the lease term.The variable portion of the rental income which is computed based on a percentage of the food
court tenants gross sales is recognised when such sales are earned.
Revenue from the sale of food and beverage is recognised upon delivery and acceptance by customers, net of
sale discounts.
(d)
Management fee

Management fee is recognised on an accrual basis.
(e)
Interest income

Interest income is recognised as interest accrues (using the effective interest method) unless collectability is in doubt.
85
2.25 Revenue (contd)
2.27 Taxes (contd)
(f)
Dividend income

Dividend income is recognised when the Groups right to receive payment is established.
(b)
Deferred tax
(g)
Rental income

Rental income arising from operating leases is accounted for on a straight-line basis over the lease terms. The
aggregate costs of incentives provided to lessees are recognised as a reduction of rental income over the lease term
on a straight-line basis.
2.26 Government grants

Government grants are recognised at their fair value where there is reasonable assurance that the grant will be received
and all attaching conditions will be complied with. When the grant relates to an expense item, it is recognised in profit or
loss over the period necessary to match them on a systematic basis to the costs that it is intended to compensate. Where
the grant relates to an asset, the fair value is recognised as deferred capital grant on the balance sheet and is amortised
to profit or loss over the expected useful life of the relevant asset by equal annual instalments.
2.27 Taxes
(a)
Current income tax

Current income tax assets and liabilities for the current and prior periods are measured at the amount expected to
be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are
those that are enacted or substantively enacted by the balance sheet date, in the countries where the Group
operates and generates taxable income.
Current taxes are recognised in profit or loss except to the extent that the tax relates to items recognised outside
profit or loss, either in other comprehensive income or directly in equity. Management periodically evaluates positions
taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and
establishes provisions where appropriate.
Deferred income tax is provided using the liability method on temporary differences at the balance sheet date
between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes.
Deferred tax liabilities are recognised for all taxable temporary differences, except:

Where the deferred income tax liability arises from the initial recognition of goodwill or of an asset or liability in
a transaction that is not a business combination and, at the time of the transaction, affects neither accounting
profit nor taxable profit or loss; and

In respect of taxable temporary differences associated with investments in subsidiaries, associates and interests
in joint ventures, where the timing of the reversal of the temporary differences can be controlled and it is
probable that the temporary differences will not reverse in the foreseeable future.

Deferred income tax assets are recognised for all deductible temporary differences, carry forward of unused tax credits
and unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible
temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilised except:

Where the deferred income tax asset relating to the deductible temporary difference arises from the initial
recognition of an asset or liability in a transaction that is not a business combination and, at the time of the
transaction, affects neither the accounting profit nor taxable profit or loss; and

In respect of deductible temporary differences associated with investments in subsidiaries, associates and interests
in joint ventures, deferred income tax assets are recognised only to the extent that it is probable that the
temporary differences will reverse in the foreseeable future and taxable profit will be available against which the
temporary differences can be utilised.
87
2.27 Taxes (contd)
2.28 Segment reporting
(b)
Deferred tax (contd)
The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it
is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax
asset to be utilised. Unrecognised deferred income tax assets are reassessed at each balance sheet date and are
recognised to the extent that it has become probable that future taxable profit will allow the deferred tax asset to
be utilised.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the
asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively
enacted at the balance sheet date.
Deferred income tax is recognised in profit or loss. Deferred income tax relating to items recognised outside profit
or loss is recognised outside profit or loss. Deferred tax items are recognised in correlation to the underlying
transaction either in other comprehensive income or directly in equity and deferred tax arising from a business
combination is adjusted against goodwill on acquisition.
Deferred tax assets and deferred tax liabilities are offset, if a legally enforceable right exists to set off current tax assets
against current income tax liabilities and the deferred taxes relate to the same taxable entity and the same taxation
authority.
Tax benefits acquired as part of a business combination, but not satisfying the criteria for separate recognition at that
date, would be recognised subsequently if new information about the facts and circumstances changed. The
adjustment would either be treated as a reduction to goodwill (as long as it does not exceed goodwill) if it was
incurred during the measurement period or in profit or loss.
(c)
Sales tax

Revenues, expenses and assets are recognised net of the amount of sales tax except:

Where the sales tax incurred on a purchase of assets or services is not recoverable from the taxation authority,
in which case the sales tax is recognised as part of the cost of acquisition of the asset or as part of the expense
item as applicable; and

Receivables and payables that are stated with the amount of sales tax included.
The net amount of sales tax recoverable from, or payable to, the taxation authority is included as part of receivables
or payables in the balance sheet.
For management purposes, the Group is organised into operating segments based on their products and services which
are independently managed by the respective segment managers responsible for the performance of the respective
segments under their charge. The segment managers report directly to the management of the Company who regularly
review the segment results in order to allocate resources to the segments and to assess the segment performance.
Additional disclosures on each of these segments are shown in Note 34, including the factors used to identify the
reportable segments and the measurement basis of segment information.
2.29 Share capital and share issue expenses

Proceeds from issuance of ordinary shares are recognised as share capital in equity. Incremental costs directly attributable
to the issuance of ordinary shares are deducted against share capital.
2.30 Treasury shares

The Groups own equity instruments, which are reacquired (treasury shares) are recognised at cost and deducted from
equity. No gain or loss is recognised in profit or loss on the purchase, sale, issue or cancellation of the Groups own equity
instruments. Any difference between the carrying amount of treasury shares and the consideration received, if reissued, is
recognised directly in equity. Voting rights related to treasury shares are nullified for the Group and no dividends are
allocated to them respectively.
2.31 Contingencies

A contingent liability is:

(a) a possible obligation that arises from past events and whose existence will be confirmed only by the occurrence or

non-occurrence of one or more uncertain future events not wholly within the control of the Group; or

(b) a present obligation that arises from past events but is not recognised because:

(i) It is not probable that an outflow of resources embodying economic benefits will be required to settle the
obligation; or

(ii) The amount of the obligation cannot be measured with sufficient reliability.
A contingent asset is a possible asset that arises from past events and whose existence will be confirmed only by the
occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Group.
Contingent liabilities and assets are not recognised on the balance sheet of the Group, except for contingent liabilities
assumed in a business combination that are present obligations and which the fair values can be reliably determined.
89
4. Other operating income (contd)
2.32 Transfers between levels of the fair value hierarchy
(2) The Special Employment Credit (SEC) was introduced as a budget initiative in the financial year 2011 and was

further enhanced in financial year 2012 to cover a wider range of employees and enabling more employers to benefit
from the Scheme. The enhanced Scheme is for 5 years and will expire on 31 December 2016.
Transfers between levels of the fair value hierarchy are deemed to have occurred on the date of the event or change in
circumstances that caused the transfers.
3. Revenue

Group

2014 2013

$000 $000

Bakery sales
252,297 230,021

Restaurant sales
130,735 122,203

Sales to franchisee
27,824
28,624

Franchise income
13,913
12,675

Food court income
164,875 143,007

589,644 536,530

4. Other operating income

Group

2014 2013

$000 $000

Management fee income
7,491
6,954

Income from mall operation
769
223

Government grant (1)
1,367 1,683

Grant income from Special Employment Credit (2)
327 147

Wage credit scheme (3)
790

PIC Bonus (4)
90

Income from expired food court stored value cards
54
64

Sponsorship income
555
585

Sundry sales

143

Rental income
2,014
418

Gain on disposal of a joint venture
27

Gain on disposal of intangible assets (Note 12)

11

Gain on disposal of property, plant and equipment
1,001
111

Foreign exchange gain
851
148

Write back of provision for reinstatement cost
92
394

Compensation received from vendor
726

Waiver of debt by vendor
170

Dividend received from unquoted equity instruments
411

Miscellaneous income
1,565
1,018

18,300 11,899
(1) Government grant in relation to business expansion activities undertaken by certain subsidiaries in the PRC.
Under this Scheme, for each Singaporean employee who is aged 50 and above and who earns up to $3,000 per
month, the Company will receive an 8% Special Employment Credit based on that employees salary.The Scheme has
2 payouts in March and September. The Group received $327,000 (2013: $147,000) during the year.
(3) The Wage Credit Scheme (WCS) was introduced as a budget initiative in the financial year 2014 to help businesses

which may face rising wage costs in a tight labour market. The Government will co-fund 40% of wage increases to
Singaporean employees earning a gross monthly wage of $4,000 for the financial year 2014 to 2015 and 20% co funding in the financial years of 2016 and 2017.
(4) Introduces in the Singapore Budget 2013, the PIC Bonus (PIC) scheme helps business defray rising operating costs

such as wages and rentals and encourages businesses to undertake improvements in productivity and innovation.
PIC gives a dollar-for-dollar matching cash bonus for the financial year 2012 to 2014, subject to an overall cap of
$15,000 for all 3 financial years combined.
5. Interest income and interest expense
Group

2014 2013

$000 $000

Interest income from:

- loans and receivables
927
758

- held-to-maturity financial assets
1,131
558

2,058 1,316

Interest expense on:

- Term loans
(3,728)
(2,675)

91
6. Profit before taxation
7. Employee benefits
Group

2014 2013

$000 $000

Staff costs (including directors)

Salaries and bonuses
115,653 104,971

Central Provident Fund and other pension contributions
13,931
14,103

Sales incentives and commission
3,428
2,908

Share-based payment (RSG Plan)
1,093
217

Other personnel benefits
27,762
20,439

161,867 142,638

RSG Plan
This is determined after charging the following:
Group

2014 2013

$000 $000

Audit fees to:

- auditors of the Company
294
281

- other auditors
199
166

Non-audit fees to:

- auditors of the Company
30
27

- other auditors
56
4

Amortisation of intangible assets (Note 12)
442
489

Impairment of loans and receivables

- trade receivables (Note 18)
137
197

- other receivables (Note 18)

26

- amount due from joint venture (Note 19)
52
607

Directors fees
168
168

Depreciation of property, plant and equipment (Note 10)
45,495
38,849

Employee benefits (Note 7)
161,867 142,638

Operating lease expenses

- fixed portion
116,613 101,795

- variable portion
12,808
13,007

Property, plant and equipment written off
3,135
743

Impairment loss on property, plant and equipment (Note 10)

824

Write-off of inventories (Note 17)
12

Impairment loss on quoted equity instruments
75

Other receivables write off
111
Under the RSG Plan, directors and employees receive remuneration in the form of fully-paid shares of the Company
as consideration for services rendered. Restricted shares are granted conditionally and the final number of restricted shares
awarded will depend on the achievement of pre-determined targets over a one year period. On meeting the performance
conditions for the performance period, one-third of the restricted shares will vest. The balance will vest equally over the
subsequent two years with the fulfilment of service requirements.
The fair value of the restricted shares granted is estimated based on the market price of the shares on grant date less the
present value of expected future dividends during the vesting period.
During the year, 314,000 (2013: 253,000) restricted shares were granted. The number of restricted shares outstanding at
year end is 616,280 (2013: 710,050) shares.
8. Income tax expense

Major components of income tax expense were:
Group

2014

$000

Current tax

- Current year
6,585

- Over provision in prior year
(82)

Deferred tax

- Origination and reversal of temporary differences
(665)

- Under/(over) provision in prior year
188

Withholding tax
734

Taxation expense
6,760

2013
$000
7,152
(114)
(988)
(215)
416
6,251
93
8. Income tax expense (contd)
A reconciliation between the tax expense and the product of accounting profit multiplied by the applicable tax rate for
the year ended 31 December is as follows:
Group

2014
2013

$000
$000

22,813
22,390

Tax at the domestic rates applicable to profits in the countries

where the Group operates (1)
4,128 4,015

Tax effect of:

Expenses not deductible for tax purposes
2,583
1,797

Depreciation not deductible for tax purposes
1,649
1,453

Income not subject to taxation
(811)
(583)

Share of results of associates and joint ventures
259
337

Tax savings arising from development and expansion
incentive (2)
(181)

(Over)/under provision in prior years

- Current tax
(82)
(114)

- Deferred tax
188
(215)

Withholding tax expense
734
416

Effect of partial tax exemption and tax relief
(168)
(140)

Deferred tax assets not recognised
631
582

Benefits from previously unrecognised temporary differences
(1,170)
(541)

Tax savings from enhanced deductions (3)
(922) (759)

Tax losses which cannot be carried forward

(3)
Others
(78)
6

Taxation expense
6,760
6,251

(1) This is prepared by aggregating separate reconciliations for each national jurisdiction.

(2) In February 2004, the Economic Development Board granted the Development and Expansion Incentive under the

International Headquarters (IHQ-DEI) Award to a subsidiary. Subject to certain conditions, the subsidiary enjoys
a concessionary tax rate of 10% on its qualifying income for a period of 5 years commencing 1 January 2003 and was
subsequently extended for 5 more years and expired as of 31 December 2012. On 19 December 2014, the subsidiary
was granted an extension of the DEI for another 5 years commencing 1 January 2013.
Deferred income tax as at 31 December relates to the following:
Group Company
Balance sheet Profit or loss Balance sheet

2014 2013 2014 2013 2014 2013

$000 $000 $000 $000 $000 $000

Deferred tax liabilities:

Differences in depreciation for tax
purposes
(2,232) (2,174) (58) (428) (167)

Dividend income

168

Other items
(387) (380)
(6)
220

(2,619) (2,554) (167)

Deferred tax assets:
Provisions
1,619 1,508 36 163

Differences in depreciation for tax purposes
429
922 (533)
72

(15)

Unutilised capital allowances
1,886
473 1,389
416

56

Unutilised tax losses
476
851 (375)
499

Other items
560 533 25 93 26

4,970 4,287

67

Deferred income tax
477 (1,203)

Unrecognised tax losses, capital allowances and other temporary differences

As at 31 December 2014, the Group has tax losses of approximately $29,412,000 (2013: $30,138,000), unutilised capital

allowances of approximately $320,000 (2013: $1,201,000) and other temporary differences of approximately $2,368,000

(2013: $1,827,000) that are available for offset against future taxable profits, for which no deferred tax assets are recognised

on these amounts due to uncertainty of their utilisation. The comparative figures have been adjusted based on the latest

tax submissions and finalisation of certain years of tax assessments. The utilisation of the tax losses is subject to the

agreement of the tax authorities and compliance with certain provisions of the tax legislation of the respective countries

in which the companies operate. As at 31 December 2014, $19,263,000 (2013: $15,285,000) of the unrecognised tax

losses will expire between 1 and 5 years.

(3) In Budget 2010, the Minister for Finance of Singapore introduced a new broad-based tax scheme to encourage

businesses to invest in productivity and innovation. The scheme enhances existing tax measures that encourage
productivity and innovative activities and consolidates them into a single scheme, known as the Productivity and
Innovation scheme (PIC). The PIC is available for Year of Assessment (YA) 2011 to YA 2015.
95
10. Property, plant and equipment (contd)
Unrecognised temporary differences relating to investments in subsidiaries
At the balance sheet date, no deferred tax liability (2013: $Nil) has been recognised for taxes that would be payable on
the undistributed earnings of certain of the Groups subsidiaries as the Group has determined that undistributed earnings
of these subsidiaries will not be distributed in the foreseeable future.
Such temporary differences for which no deferred tax liability has been recognised aggregate to $26,605,000 (2013:
$24,218,000). The deferred tax liability is estimated to be $1,330,000 (2013: $1,211,000).
Tax consequences of proposed dividends
There are no income tax consequences attached to the dividends to the shareholders proposed by the Company but
not recognised as a liability in the financial statements (Note 36).

Machinery
Leasehold Leasehold
and
Electrical
Furniture
Office
property
land
equipment
works
and fittings equipment
Group $000
$000
$000
$000
$000
$000
Cost

As at 1.1.2013 3,493
7,503
36,170
32,581
34,652
8,329
Additions 4,228
12,531
15,149
15,415
11,618
2,780

Reclassifications(2) 45,224

933
3,139
2,315
(196)

Write offs

(3,502)
(2,147)
(1,876)
(401)
Disposals

(700)
(298)
(193)
(84)

Attributable to assets
held for sale(3)

(1,555)

(174)
(219)
Translation
difference 228
85
612
207
295
116

As at 31.12.2013
and 1.1.2014 53,173
20,119
47,107
48,897
46,637
10,325
Additions 2,603
1,053
6,647
7,143
7,231
1,271

Reclassifications(2)

435
159
365
42

Write offs

(2,216)
(2,641)
(2,335)
(240)
Disposals

(1,381)
(276)
(298)
(407)
Translation
difference 145
104
697
665
1,056
157

As at 31.12.2014 55,921
21,276
51,289
53,947
52,656
11,148

Accumulated
depreciation and
impairment
losses

As at 1.1.2013 1,137
17
20,138
16,017
18,176
5,153

Charge for the year 652
233
6,140
6,918
6,838
1,569

Reclassifications

197
1,028
33
(138)

Write offs

(3,320)
(2,001)
(1,777)
(386)
Disposals

(633)
(290)
(116)
(80)

Impairment loss for
the year

552
100
37
28

Attributable to assets
held for sale(3)

(1,145)

(106)
(176)
Translation
difference
82
2
280
160
247
93

As at 31.12.2013
and 1.1.2014 1,871
252
22,209
21,932
23,332
6,063

Charge for the year 1,049
392
6,750
7,982
7,480
1,844

Reclassifications

41

(41)

Write offs

(1,664)
(2,184)
(1,794)
(165)
Disposals

(766)
(83)
(196)
(213)
Translation
difference
60
7
382
393
627
104

As at 31.12.2014 2,980
651
26,911
28,081
29,449
7,592

Net carrying
amount

As at 31.12.2013 51,302
19,867
24,898
26,965
23,305
4,262

As at 31.12.2014 52,941
20,625
24,378
25,866
23,207
3,556

9. Earnings per share

Basic earnings per share are calculated by dividing the Groups profit for the year attributable to owners of the Company
by the weighted average number of ordinary shares outstanding during the financial year.
Diluted earnings per share are calculated by dividing the Groups profit for the year attributable to owners of the
Company by the weighted average number of ordinary shares outstanding during the financial year plus the weighted
average number of ordinary shares that would be issued on the conversion of all the dilutive potential ordinary shares
into ordinary shares.

These profit and share data are presented in the table below:
Group

2014
2013

$000
$000

Profit for the year attributable to owners of the Company
12,194
13,600

No. of
No. of

shares
shares

000
000

Weighted average number of ordinary shares for basic
earnings per share computation *
281,890 281,362

Effects of dilution:

- Restricted shares granted conditionally under the
BreadTalk Restricted Share Grant Plan
616
877

Weighted average number of ordinary shares for diluted
earnings per share computation *
282,506 282,239

The weighted average number of shares takes into account the weighted average effect of changes in treasury shares
transactions during the year.
97

Motor Construction

Renovation (1) vehicles -in-progress Total
Group
$000 $000 $000 $000
Cost

As at 1.1.2013
78,027
1,446
54,032
256,233

Additions
33,727
457
11,846
107,751

5,342
(56,757)

Write offs
(3,445)
(136)

(11,507)
Disposals
(321)
(52)

(1,648)

Attributable to assets held for sale(3)
(1,882)
(127) (3,957)

Translation difference
2,613
32
384
4,572

As at 31.12.2013 and 1.1.2014
114,061
1,747
9,378
351,444

Additions
14,922
908
1,851
43,629

7,172
(8,173)

Write offs
(4,188)

(11,620)
Disposals
(2,345)
(383)

(5,090)

2,483
42
42
5,391

As at 31.12.2014
132,105
2,314
3,098
383,754

Accumulated depreciation and
impairment losses

As at 1.1.2013
37,368
819

98,825

Charge for the year
16,285
214

38,849

Reclassifications
(1,120)

Write offs
(3,158)
(122)

(10,764)
Disposals
(317)
(52)

(1,488)

Impairment loss for the year
107

824

Attributable to assets held for sale(3)
(1,379)

(2,806)

1,262
18

2,144

As at 31.12.2013 and 1.1.2014
49,048
877

125,584

Charge for the year
19,672
326

45,495

Reclassifications

Write offs
(2,678)

(8,485)
Disposals
(842)
(294)

(2,394)

1,291
20

2,884

As at 31.12.2014
66,491
929

163,084

(1) Additions to renovation during the year include provision for reinstatement costs of $2,169,000 (2013: $2,926,000).
(2) Reclassifications mainly relate to the reclassification of construction in progress to the respective property, plant and

equipment category upon completion of construction.
(3) Assets held for sale are detailed in Note 21 to the financial statements.
Assets written off
Property, plant and equipment written off during the year arose mainly due to the refurbishment/closure of certain bakery
outlets and food courts. The amount written off represents the total carrying value of the property, plant and equipment
attributable to the bakery outlets and food courts at the date of refurbishment/closure.
There is no residual value for the assets written off.
Assets pledged as security
The Group has the following assets pledged to secure the Groups bank loans (Note 26).

Leasehold land

Leasehold property

Impairment of assets
Group
and Company

2014 2013
$000 $000
18,246
50,667
17,514
48,955
68,913 66,469
In 2013, impairment loss of $824,000 was recognised in Administrative expenses in profit or loss during the year
comprised impairment loss on property, plant and equipment of restaurants and certain food stalls which have been
persistently incurring losses, and of restaurants closed during the year.
Capitalisation of borrowing costs
The Groups leasehold property includes borrowing costs arising from bank loans borrowed specifically for the purpose
of the construction of leasehold property. The borrowing costs capitalised as cost of property, plant and equipment in
2013 year amounted to $145,000.

Net carrying amount

As at 31.12.2013
65,013
870
9,378
225,860

As at 31.12.2014
65,614
1,385
3,098
220,670

99

Leasehold Leasehold Machinery & Electrical

property
land
equipment
works

Furniture
and
fittings

$000
$000
$000
$000
$000
Company
Cost

As at 1.1.2013

5,147

22
20
Additions 4,228
12,531
297
1,970
703

Reclassifications
45,224

Write offs

(3)

As at 31.12.2013 and
1.1.2014
49,452
17,678
297
1,989
723
Additions 2,602
1,053
43
126
441

As at 31.12.2014
52,054
18,731
340
2,115
1,164

Accumulated depreciation

As at 1.1.2013

22
17

Charge for the year
497
164
29
172
62

Write offs

(3)

As at 31.12.2013 and
1.1.2014
497
164
29
191
79

Charge for the year
890
321
66
412
215

As at 31.12.2014
1,387
485
95
603
294

Net carrying amount

As at 31.12.2013
48,955
17,514
268
1,798
644

As at 31.12.2014
50,667
18,246
245
1,512
870

Office
property

Renovation

$000 $000
Company
Cost

As at 1.1.2013
313

Additions 925
4,486

Reclassifications

Write offs

As at 31.12.2013 and 1.1.2014
1,238
4,486
Additions 339
75

As at 31.12.2014
1,577
4,561


As at 1.1.2013
181

Charge for the year
171
436

Write offs

As at 31.12.2013 and 1.1.2014
352
436

Charge for the year
419
911

As at 31.12.2014
771
1,347

Net carrying amount

As at 31.12.2013
886
4,050

As at 31.12.2014
806
3,214

Construction-
in-progress
Totals
$000
$000
39,004
6,220
(45,224)

44,506
31,360
(3)
75,863
4,679
80,542
220
1,531
(3)
1,748
3,234
4,982
74,115
75,560
BreadTalk Group Limited ANNUAL REPORT 2014 101
11. Investment property
12. Intangible assets

Investment

property

$000
Group
Cost

As at 1.1.2013, 31.12.2013 and
1.1.2014

Additions
23,153

As at 31.12.2014
23,153

As at 1.1.2013, 31.12.2013 and
1.1.2014

Charge for the year

Group

Brand
Trade
Franchise
Location

Goodwill
value
mark
rights
premium
Total

$000 $000 $000 $000 $000 $000
As at 31.12.2014

Net carrying amount
As at 31.12.2013
As at 31.12.2014

To explain no depreciation
23,153
The Group has no restrictions on the realisability of its investment property and no contractual obligations to purchase,
construct or develop investment property or for repairs, maintenance or enhancements.
Acquisition of property
On 31 July 2014, the Group entered into several sales and purchase agreements to acquire an office space in Shanghai,
The Peoples Republic of China, and has since completed the transaction and taken over the premises on 10 October
2014. The property is mortgaged to secure bank loans of $10,780,000 (2013: Nil) (Note 25).
The investment property held by the Group as at 31 December is as follows:

Unexpired lease
Description and Location
Existing Use
Tenure
term

18 units office space located in
Vacant
Leasehold
47 years
Xuhui district, Shanghai, The
Peoples Republic of China
Cost

As at 1.1.2013
6,173
3,209
932
2,216
505
13,035

Additions
91 128 219

Disposal

(878) (878)

1 29 30

As at 31.12.2013 and

1.1.2014
6,173
3,209
1,024
1,495
505
12,406
Additions

286
51

337

Write off
(50) (50)

17 22 39

As at 31.12.2014
6,173
3,209
1,327
1,518
505
12,732

Accumulated amortisation
and impairment losses

As at 1.1.2013
327
1,716
792
1,164
505
4,504

Amortisation
214 50 225 489

Disposal

(362) (362)

3 3

As at 31.12.2013 and
1.1.2014
327
1,930
842
1,030
505
4,634

Amortisation
213 72 157 442

Write off
(50) (50)

2 13 15

As at 31.12.2014
327
2,143
916
1,150
505
5,041

Net carrying amount

As at 31.12.2013
5,846
1,279
182
465

7,772

As at 31.12.2014
5,846
1,066
411
368

7,691

Brand value, trade mark, franchise rights and location premium are determined to have finite useful lives and are amortised on a

straight-line basis over their respective estimated economic useful lives and assessed for impairment whenever there is an indication

that the intangible assets may be impaired. Brand value, trade mark and franchise rights have remaining useful lives of 5 years (2013:

6 years), 1 to 5 years (2013: 1 to 5 years) and 1 to 6 years (2013: 1 to 6 years) as at 31 December 2014 respectively.

Amortisation expense is included in Administrative expenses in profit of loss.
In 2013, the Group disposed of franchise rights with a net carrying amount of $516,000 in conjunction with its investment in an
associate Carl Karcher Enterprise (Cayman) Ltd.
12. Intangible assets (contd)
12. Intangible assets (contd)
Impairment testing of goodwill
Goodwill arising from the acquisition of Topwin Investment Holding Pte Ltd and its subsidiaries in 2005 was allocated
to 2 cash-generating units (CGU), which represent the 2 geographical segments (i.e. Shanghai and Beijing segments) in
which the acquired food courts are located. The food courts located in the same geographical segment are managed by
the same management team.
Goodwill on the acquisition of MWA Pte Ltd in December 2007 was primarily attributable to the food court operations
at Wisma Atria, Singapore.
The carrying amounts of goodwill allocated to each CGU are as follows:

Pre-tax
Pre-tax

Carrying
Carrying
discount
discount

amount as amount as
rate
rate

at 31.12.14 at 31.12.13
2014
2013

$000
$000

Shanghai segment
3,569
3,569
13.8%
13.0%

Beijing segment
1,009
1,009
13.8%
13.0%

Food court operation at Wisma Atria,
Singapore
1,268
1,268
9.7%
10.0%

5,846
5,846

The recoverable amount is determined based on a value in use calculation using the cash flow projections based on

financial budgets approved by management covering a three-year period. The discount rates applied to the cash flow

projections are derived from cost of capital plus a reasonable risk premium at the date of assessment of the respective

cash generating units.
Sensitivity to changes in assumptions

With regards to the assessment of value in use for the CGUs, management believes that no reasonably possible changes
in any of the above key assumptions would cause the carrying value of the unit to materiality exceed its recoverable
amount.
13. Investment securities

Group

2014 2013

$000 $000


- Equity instruments (quoted), at fair value
239
425

- Equity instruments (unquoted), at cost
34,515
34,150

- Redeemable preference shares (unquoted), at cost
5,067
*

39,821 34,575


- 8% SGD junior bonds due on 29 January 2016 (unquoted)
7,224
7,224

- 3% SGD junior bonds due on 31 December 2016 (unquoted)
18,000
18,000

- 5% SGD junior bonds due on 31 March 2018 (unquoted)
12,137

37,361 25,224

77,182 59,799

* less than $1,000

8% SGD junior bonds and redeemable preference shares

The junior bonds are secured by a mortgage over the Katong Mall property, assignment of rental proceeds of the
property and debentures of Pre 1 Investments Pte Ltd. The payments of the principal and interest on the junior bonds are
subordinated to the payments of principal and interest on the bank borrowings obtained for the purchase of the
Katong Mall.
Key assumptions used in the value in use calculations

The calculations of value in use for the CGUs are most sensitive to the following assumptions:
Budgeted gross margins Gross margins are based on budget approved by management.
Growth rates The forecasted growth rates are based on published industry research and do not exceed the long-term
average growth rate for the industries relevant to the CGUs.
The junior bonds mature in 2015 and will bear interest, payable semi-annually in arrears, at 8% per annum from 29 January
2012 to but excluding the maturity date of the junior bonds, subject to the extinguishment of unpaid interest.
Pre-tax discount rates Discount rates represent the current market assessment of the risks specific to each CGU,
regarding the time value of money and individual risks of the underlying assets which have not been incorporated in the
cash flow estimates. The discount rate calculation is based on the specific circumstances of the Group and its cashgenerating units and derived from its weighted average cost of capital (WACC).The WACC takes into account both debt
and equity. The cost of equity is derived from the expected return on investment by the Groups investors. The cost of
debt is based on the interest bearing borrowings the Group is obliged to service. Segmentspecific risk is incorporated
by applying individual beta factors. The beta factors are evaluated annually based on publicly available market data.
In 2014, the junior bonds holders agreed to extend the maturity by 1 year ending on 29 January 2016.
13. Investment securities (contd)
14. Investment in subsidiaries
3% SGD junior bonds
On 10 February 2012, IPPL had completed the subscription of $18,000,000 in principal amount of junior bonds and
was issued 72 ordinary shares of $1.00 per ordinary share in the share capital of Perennial (Chijmes) Pte Ltd (PCPL).
IPPLs investment in ordinary shares of PCPL is classified as an investment in associate (Note 15).
The junior bonds are expected to mature in 2016 and will bear interest semi-annually in arrears, at minimum 3% per
annum from 1 January 2013.
In 2013, it was agreed among the shareholders of PCPL to waive the coupon payment on the junior bonds for the period
June 2013 to December 2014.

Company
2014 2013
$000 $000

Unquoted equity shares at cost 28,864
28,489

Share based compensation reserve
606
468

Impairment losses:

- Unquoted shares (note d) (5,300)
(5,300)

24,170 23,657

5% SGD junior bonds
On 31 March 2014, IPPL had completed the subscription of $12,137,000 in principal amount of junior bonds and was
issued 121,370 redeemable preference shares of $41.75 per share (aggregate issue price of $5,067,000) and 121,370
ordinary shares of $0.15 per ordinary share ($18,000) in the share capital of Perennial Somerset Investors Pte Ltd
(PSIPL).
The junior bonds are expected to mature in 2018 and will bear interest semi-annually in arrears, at minimum 5% per
annum from 31 March 2014.
Equity instruments (unquoted)
On 15 April 2013, the Company together with a consortium of investors, entered into a joint venture agreement to
invest in Perennial Tongzhou Holdings Pte Ltd (PTHD) for the subscription of ordinary shares of PTHD. The Companys
subscription of 14,520 ordinary shares for a cash consideration of $14,520,000 represents a 5.86% equity interest in
PTHD. As at 31 December 2014, the Company has paid approximately 97% of the subscription amount of $14,020,000.
On 30 September 2012, IPPL together with a consortium of investors, entered into a joint venture agreement to invest in
Perennial Tongzhou Development Pte Ltd (PTD) for the subscription of ordinary shares of PTD. IPPLs subscription of
20,130 ordinary shares for a cash consideration of $20,130,000 represents a 5.72% equity interest in PTD.
Investments pledged as security
The Groups investments in unquoted equity instruments of $25,215,000 (2013: $20,130,000) and junior bonds of
$37,361,000 (2013: $25,224,000) have been pledged as security for bank loans (Note 25).
Impairment losses
During the financial year, the Group recognised impairment loss of $75,000 (2013: Nil) for quoted equity instruments as
there was significant decline in the fair value of the investments below their costs.
On 12 March 2014, the shareholders of PTD agreed to an additional capital injection in PTD, of which IPPLs proportionate
share of the capital call was $347,000. 347,000 shares was allocated to IPPL on 14 March 2014.
a. Composition of the Group
The Groups has the following investment in subsidiaries:

Proportion of

Country of ownership

Name
incorporation Principal activities interest

2014 2013

% %

Held by the Company

BreadTalk Pte Ltd (1)
Singapore Bakers and
100 100

manufacturers of and

dealers in bread, flour

and biscuits

Together Inc. Pte Ltd (3)
Singapore Investment holding
100 100

BreadTalk International Pte Ltd (3) Singapore Investment holding
100 100

Topwin Investment Holding Pte Ltd (3)
100 100

Star Food Pte Ltd (3)
100 100

Imagine IHQ Pte Ltd (3)
100 100

Imagine Properties Pte Ltd (1)
100 100
14. Investment in subsidiaries (contd)

Proportion of


Name
incorporation Principal activities interest

2014 2013

% %

Held through BreadTalk

Pte Ltd

Taster Food Pte Ltd (1)
Singapore
Operators of food and
70
70

drinks outlets, eating

houses and restaurants

Thye Moh Chan Pte. Ltd. (3)
Singapore
Wholesale of
100
100

confectionery and

bakery products

Queens Coffee Pte Ltd (3)
Singapore
Processing, sale and
100
100

distribution of premium
coffee beans and tea
dust; and distribution of

related processing

equipment

Held through Taster

Food Pte Ltd

Taster Food International
Singapore
Investment holding
90
90

Pte Ltd (3) (11) (13)

Proportion of

Name incorporation Principal activities interest

2014 2013

% %


International Pte Ltd

Shanghai BreadTalk Co., Ltd (2)
Peoples
Bakers and
100
100

Republic of

China

and biscuits

Held through Taster

Food International Pte
Ltd

Taster Food (Thailand)

Thailand
Co. Limited (8)(11) (14)
Held through Together

Inc. Pte Ltd

Ramen Play Pte Ltd (3)

Operators of restaurants

Singapore

49
49
85
85

Shanghai BreadTalk
Peoples
Management of food
100
100

Gourmet Co., Ltd (2)
Republic of
and beverage,

China manufacture and retail

of bakery, confectionery

products

Beijing BreadTalk
Peoples
Management of food
100
100

Restaurant Management
Republic of
and beverage,

Co., Ltd (2)
China
manufacture and retail


products

BreadTalk (Thailand)
Thailand Management of food
49 (15) 49(11)

and beverage,

Company Limited (10)

(Note (e))

products

BreadTalk Corporation
Thailand Investment Holding
49 (16)
(10)

(Thailand) Co., Ltd.,

(Note (e))

ML Breadworks Sdn Bhd (4)
Malaysia
Bakers and
90
90



and biscuits

Held through Shanghai

BreadTalk Co. Ltd.

Shanghai Ramen Play
Peoples
30
30

Co., Ltd (5) (17)
Republic of China

Proportion of


2014 2013

% %

Held through Beijing

BreadTalk Restaurant

Management Co. Ltd

Beijing BreadTalk Co.,Ltd (2)
Peoples
Manufacture and sale of
100
100

Republic of
bakery and

China
confectionery products


(Thailand) Co. Ltd

BreadTalk Corporation

(Thailand) Co., Ltd., (10)

(Note (e))
Thailand
Investment Holding
50.9 (16)


Corporation (Thailand)

Co. Ltd

BreadTalk (Thailand)
Thailand
Management of food
51 (15) 49 (11)
(10)

Company Limited
and beverage,

(Note (e))



products

Held through Topwin

Investment Holding Pte Ltd

Food Republic

(Shanghai) Co., Ltd (2)
Peoples
Food court operator
100
100

Republic of

China

Proportion of


2014 2013

% %

Held through Topwin

Investment Holding Pte

Ltd

Megabite (S) Pte Ltd (3)
Singapore
Investment holding
100 100

Megabite Eatery (M) Sdn
Malaysia
Operator of food and
100
100
Bhd (4)
beverage outlets

Food Republic Taiwan
Taiwan
Food court operator
90
90
Co., Ltd (9)

Beijing Da Shi Dai Food
Peoples
Food court operator

and Beverage Co., Ltd (2)
Republic of

China

Megabite Hong Kong
Hong Kong
Investment holding and
Limited (6) Food court operator

Food Republic Pte Ltd (1)

FR International Holdings
Pte Ltd . (3) (Note (f))
100
100
85
85
Singapore

Food court operator
100
100
Singapore
Investment Holding
100
FR (Thailand) Co., Ltd (10) (11)

Thailand

Held through Food
Republic (Shanghai)
Co. Ltd.

Chongqing Food
Peoples
Republic Food &
Republic of
Beverage Management
China
Co., Ltd (5)

Food court operator
49
49
100
100

Food court operator

Food Republic (Chengdu)

Co., Ltd (5)

Peoples
Republic of
China
Food court operator

Food Republic Hangzhou

F&B Co.,Ltd (5)

Peoples
Republic of
China
Food court operator

Shanghai Ramen Play

Co., Ltd (5)(17)

Shanghai Food Court

F&B Management Ltd.
Co (5) (Note (f))
Peoples
Republic of
China
Peoples
Republic of
China

100
beverage outlets

Peoples
Republic of
China

beverage outlets
Shanghai Food Union

F&B Management Ltd.
Co. (5) (Note (f))
100
100

100
100

30
30
100

Proportion of


2014 2013

% %

Held through Megabite

Hong Kong Limited

BreadTalk Concept Hong Kong
Hong Kong
Management of food
100
100
Limited (6)
and beverage,



products

Food Republic Shenzhen
Peoples
Food court operator
100
100

F&B Management
Republic of

Co.,Ltd (7)
China

Food Republic
Guangzhou F&B
Management Co., Ltd (7)
Held through Megabite

(S) Pte Ltd

MWA Pte Ltd (12)

Food Art Pte Ltd (3)

Held through Star Food

Pte Ltd

Shanghai Star Food F&B


Beijing Star Food F&B


Peoples
Republic of
China
Food court operator

Singapore

Singapore

Peoples
Republic of
China
Peoples
Republic of
China
Dormant

Dormant
75
75
100 100
100 100
Investment holding

(1) Audited by Ernst & Young LLP, Singapore

(2) Audited by member firms of Ernst & Young Global in the respective countries

(3) Audited by TY Teoh International, Singapore

(4) Audited by TY Teoh International, Malaysia

(5) .Audited by Shanghai Xin Gao Xin Certified Public Accountants Co., Ltd, Peoples Republic of China

(6) Audited by S.F. Kwok & Co. Certified Public Accountants, Hong Kong

(7) Audited by Guang Dong Zhihe Certified Public Accountants, Peoples Republic of China

(8) Audited by Phattarakit Aupliting Office Co.,Ltd, Thailand

(9) Audited by KPMG, Taiwan

(10) Audited by Tree Sun Co., Ltd, Thailand

(11) Considered a subsidiary of the Company as the Company has voting control at general meetings and Board

meetings
(12) MWA Pte Ltd is the process of striking off and unaudited financial statements have been used for the preparation

of the consolidated financial statements as it is not significant to the Group.
(13) The Group holds 63% ownership interest in Taster Food International Pte Ltd in 2014 and 2013 and accounted for

it as a subsidiary
(14) The Group holds 31% ownership interest in Taster Food (Thailand) Co., Ltd in 2014 and 2013 and accounted for it

as a subsidiary
(15) The Group holds 100% ownership interest in BreadTalk (Thailand) Co., Ltd in 2014 through BreadTalk International

Pte Ltd and BreadTalk Corporation (Thailand) Co. Ltd. (2013: 49%) and accounted for it as a subsidiary
(16) The Group holds 99.9% ownership interest in BreadTalk Corporation (Thailand) Co., Ltd in 2014 through BreadTalk

International Pte Ltd and BreadTalk (Thailand) Co. Ltd. (2013: NIL%) and accounted for it as a subsidiary
(17) The Group holds 60% ownership interest in Shanghai Ramen Play Co., Ltd through Shanghai BreadTalk Co. Ltd. and

Food Republic (Shanghai) Co. Ltd. and accounted for it as a subsidiary
100
100
100
100
(b) Interests in subsidiaries with material non-controlling interests (NCI)
The Group has the following subsidiaries that have NCI that are material to the Group.
Dormant

Proportion of

ownership
Profit
Accumulated

interest held
allocated to
NCI at the

by non-
NCI during
end of
Dividends

Name of
Principal place of
controlling
the reporting
reporting
paid to
Subsidiary
business interest period period NCI

$000 $000 $000

31 December
2014:

Taster Food Pte Ltd
Singapore
30%
4,469
14,686
984

31 December
2013:

Taster Food Pte Ltd
Singapore
30%
3,432
11,201
984

There are no significant restrictions on the Groups ability to use or access assets and settle liabilities of the subsidiary
with material non-controlling interests.
(c)
Summarised financial information about subsidiaries with material NCI
(c)
Summarised financial information about subsidiaries with material NCI (contd)
Other summarised information
Summarised financial information including goodwill on acquisition and consolidation adjustments but before
intercompany eliminations of subsidiaries with material non-controlling interests are as follows:
Summarised balance sheets

Taster Food Pte Ltd

As at
As at

31 December
31 December

2014
2013

$000
$000

Current
Assets
51,164
38,582
Liabilities
(23,097)
(23,225)

Net current assets
28,067
15,357

Non-current
Assets
18,723
20,375
Liabilities
(1,665)
(1,261)

Net non-current assets
17,058
19,114

Net assets
45,125
34,471

Summarised statement of comprehensive income

Taster Food Pte Ltd

2014
2013

$000
$000

Revenue
105,687
92,663
16,840
12,610
Income tax expense
(3,214)
(2,147)

Profit after tax continuing operations
13,626
10,463

13,626
10,463


Taster Food Pte Ltd

2014
2013

$000
$000
Net cash flows from
operations
20,495
17,642

Acquisition of significant
property, plant and
equipment
(4,118)
(12,765)

(d)
Impairment testing of investment in subsidiaries

In 2013, management performed an impairment test for the investment in Star Food Pte Ltd as the subsidiary had
been making losses. An impairment loss of $200,000 was recognised for the year ended 31 December 2013.
(e)
Acquisition of non-controlling interests

On 1 July 2014, BreadTalk Corporation (Thailand) Co., Ltd.,(BTC), a 99.9% owned subsidiary of the Company,
acquired an additional 51.0% equity interest in BreadTalk Thailand Co., Ltd (BTTH) from its non-controlling interests
for a cash consideration of $39. As a result of this acquisition, BTTH became a wholly owned subsidiary. The carrying
value of net liabilities of BTTH as at 30 June 2014 was $824,000 and the deficit in carrying value of the additional
interest acquired was $492,000. The cumulative amount of $492,000 of the consideration and the deficit in the
carrying value of the additional interest acquired has been recognised as Premium paid on acquisition of noncontrolling interests within equity.
The following summarises the effect to the change in the Groups ownership interest in BTTH on the equity
attributable to owners of the Company:

Consideration paid for acquisition of non-controlling interests
Increase in equity attributable to non-controlling interests

Decrease in equity attributable to owners of the Company

* less than $1,000
$000
*
492
492
15. Investment in associates (contd)
(f)
Incorporation of new subsidiaries
BreadTalk Corporation (Thailand) Co., Ltd.,(BTC)

Name Country of Proportion of

incorporation Principal activities ownership interest

2014 2013

%
%

Held through subsidiaries

Perennial (Chijmes) Pte Ltd
Singapore
Investment holding
29
29
(PCPL) (1)
BTC was incorporated on 6 February 2014 with a share capital of Baht 100,000. BTC was acquired by BreadTalk
International Pte Ltd and BreadTalk (Thailand) Company Limited on July 2014 and become a 99.9% subsidiary.
Shanghai Food Court F&B Management Ltd. Co (SHFC)

SHFC was incorporated as a wholly-owned subsidiary of Food Republic (Shanghai) Co., Ltd on 31 March 2014 with
a share capital of RMB100,000.
Shanghai Food Union F&B Management Ltd. Co. (SHFU)

SHFU was incorporated as a wholly-owned subsidiary of Food Republic (Shanghai) Co., Ltd on 22 May 2014 with a
share capital of RMB100,000.
FR International Holdings Pte Ltd (FRI)

FRI was incorporated as a wholly-owned subsidiary of Topwin Investment Pte Ltd on 25 November 2014 with a share
capital of $2.
15. Investment in associates

The Groups material investments in associates are summarised below:
Group

2014

$000

Carl Karcher Enterprises (Cayman) Ltd
1,617

Other associates
1,416

At end of year
3,033

2013
$000
2,870
1,698
4,568
Details of the associates are as follows:
JBT (China) Pte Ltd

Singapore
Investment holding
30
(JBTC) (2)
30

Tate Projects Pte. Ltd. (3)
Singapore
General building contractor
25

Carl Karcher Enterprises
Cayman
Investment holding
40

(Cayman) Ltd (CKEC) (4) islands

Held by PCPL

Pre 8 Investments Pte Ltd (1)
Singapore
Operators of commercial
100

malls

Held by JBTC

JBT (Shanghai) Co., Ltd (5)
Peoples
100

Republic of

China
25

Held by CKEC

Carl Karcher Enterprises (HK)
Hong Kong
Investment holding
100
Limited (4)

CKE (Shanghai) F&B

Management Limited (4)

(1)
(2)
(3)
(4)

(5)

Peoples Operators of restaurants

Republic of
China
100
40
100
100
100
100
Audited by KPMG LLP, Singapore

Audited by Deloitte LLP, Singapore
Audited by Leethen & Associates, Singapore
Audited by KPMG, Huazhen, Peoples Replublic of China
Audited by Shanghai Xin Gao Xin Certified Public Accountants Co., Ltd, Peoples Republic of China
The activities of the associates are strategic to the Groups activities.The Group has not recognised losses relating to PCPL
where its share of losses exceeds the Groups interest in the associate. The Groups cumulative share of unrecognised
losses as at 31 December 2014 was $2,371,000 (2013: $1,180,000) and for the year was $1,914,000 (2013: $353,000).
The Group has no obligation in respect of these losses.
Dividends of $450,000 (2013: NIL) were received from an associate that is not individually material to the Group. All
associates are not restricted by regulatory requirements on the distribution of dividends.

CKEC

2014

$000

Revenue
5,134

Profit or loss after tax from continuing operations
(3,164)

(17)

3,181

Aggregate information about the Groups investments in associates that are not individually material are as follows:

Group

2014
2013

$000
$000

168
409


8

168
417

The summarised financial information in respect of CKEC, based on its FRS financial statements and reconciliation with

the carrying amount of the investment in the consolidated financial statements are as follows:

Summarised balance sheet
CKEC

2014

$000

Current assets
2,583

Non-current assets
2,061

Total assets
4,644

Current liabilities
(1,224)

(32)

Total liabilities
(1,256)

Net assets
3,388

Proportion of the Groups ownership
40%

Groups share of net assets
1,355

Exchange differences
278

Other adjustments
(16)

Carrying amount of the investment
1,617

2013
$000
6,484
105
6,589
(146)
(9)
(155)
6,432
40%
2,573
17
280
2,870
2013
$000
(482)
1
(481)
16. Investment in joint ventures

The Groups material investments in joint ventures are summarised below:
Group

2014

$000

BTM (Thailand) Co., Ltd
3,047

Shanghai ABPan Co., Ltd
3,702

Other joint ventures
1,147

Exchange difference
339

At end of year
8,235

2013
$000
2,773
773
92
3,638
Details of the joint ventures are as follows:

Country of Proportion of

Name
incorporation
Principal activities ownership interest

2014
2013

%
%

Held through subsidiaries

Shanghai Hong Bu Rang
Peoples
Dormant

50

Food & Beverage
Republic of

Management Co., Ltd (1) China

Apex Excellent Sdn Bhd (2)
Malaysia
Food court operator
50
50

Street Food Pte Ltd (3)
Singapore
Dormant
50
50

Shanghai ABPan Co., Ltd (4)
Peoples
Manufacture and sale of
50
50

(SHAB)
Republic of
frozen dough

China

BTM (Thailand) Co., Ltd (5)
Thailand
Management of food and
50

beverage, manufacture

and retail of bakery,

confectionery products
16. Investment in joint ventures (contd)

(1)
(2)
(3)
(4)
(5)
16. Investment in joint ventures (contd)
Audited by Shanghai Xin Gao Xin Certified Public Accountants Co., Ltd, Peoples Republic of China
Audited by TY Teoh International, Malaysia
Audited by TY Teoh International, Singapore
Audited by Ernst & Young Hua Ming LLP, Peoples Republic of China
Audited by Pricewaterhousecoopers ABAS Ltd, Thailand
(a)
Divestment in Shanghai Hong Bu Rang Food & Beverage Management Co., Ltd (SHBR)

The Group sold off its interest in SHBR during the financial year for a cash consideration of $27,000 and correspondingly
recognised a gain on disposal of joint venture of $27,000.
(b)
New joint venture

On 4 August 2014, a wholly owned subsidiary, BreadTalk (Thailand) Company Limited (BTTH) was allotted
2,032,614 shares in the capital of BTM (Thailand) Co., Ltd (BTM) at an investment cost of $4,008,000
(THB101,631,000). The consideration was satisfied by the sale of the business and assets of BreadTalk outlets of
BTTH. Accordingly, the Group recorded a disposal of the property, plant and equipment with a net carrying amount
of $2,268,000 and recognised the Groups 50% portion of the net gain in profit or loss of $865,000 on the disposal
of property, plant and equipment.
(c)
Additional interest in the joint venture Shanghai ABPan Co., Ltd (SHAB)

During the year, SHAB increased its share capital to $6,571,000. Proportionate to its shareholdings of 50% in SHAB,
a wholly owned subsidiary, Shanghai BreadTalk Co. Ltd injected additional share capital of $1,036,000.

The activities of the joint ventures are strategic to the Groups activities.The Group jointly controls the joint ventures with
other partners under contractual agreement that requires unanimous consent fo all major decisions over the relevant
activities.
Dividends of $334,000 (2013: $208,000) were received from SHAB. All joint ventures are not restricted by regulatory
requirements on the distribution of dividends.
Aggregate information about the Groups investments in joint ventures that are not individually material are as follows:
Group

2014

$000

217


217

2013
$000
265
265
The summarised financial information in respect of SHAB and BTM, based on its FRS financial statements and reconciliation
with the carrying amount of the investment in the consolidated financial statements are as follows:
Summarised balance sheet
SHAB BTM

2014
2013
2014 2013

$000 $000
$000 $000

3,169
2,062
3,197

Trade receivables
-
-
515

Other current assets
4,328
3,164
102

Current assets
7,497
5,226
3,814

Non-current assets
2,400
2,415
4,966

Total assets
9,897
7,641
8,780

Current liabilities
(1,690) (2,095)
(536)


Total liabilities
(1,690) (2,095)
(536)

Net assets
8,207
5,546
8,244

Proportion of the Groups ownership
50%
50%
50%

Groups share of net assets
4,104
2,773
4,122

Other adjustments
(47)

(1,075)

Exchange difference
(355)

Carrying amount of the investment
3,702
2,773
3,047

SHAB BTM

2014
2013
2014 2013

$000 $000
$000 $000

Revenue
11,641 9,950
2,078

Operating expenses
(10,579) (9,068)
(2,021)

Interest expense
(4)
(3)
-

Profit before tax
1,058
879
57

Income tax expense
(259)
(220)
-

Profit after tax
799
659
57

-
-
-

799
659
57
17. Inventories
18. Trade and other receivables (contd)
Group

2014
2013

$000
$000

Balance sheet:

Raw materials and consumables, at cost
9,647
9,012

Semi-finished goods
490
571

Finished goods
461
366

Base inventories (1)
31 55

Total inventories at lower of cost and net realisable value
10,629 10,004

(1) This is stated after writing down 50% of the original cost of base inventories.

Other receivables (current) include initial fee receivable of $4,770,000 (2013: $5,992,000) from food atrium stall
tenants.The initial fee receivable is a contribution from tenants mainly for renovation costs of the leased food atrium stalls.
Other receivables (non-current) include the following:
Group

2014
2013

$000
$000

Profit or loss:

Inventories recognised as an expense in cost of sales
147,670 137,190

Inclusive of the following charge:

- Write-off of inventories
12

18. Trade and other receivables
Group Company

2014
2013
2014
2013

$000
$000
$000
$000

Trade receivables
9,443
9,944

Other receivables
9,984
9,461
1,694
734

Interest receivable
1,160
606

Deposits
33,907 29,134
160 234

54,494 49,145
1,854
968

Other receivables (non-current)
2,350
3,277

Financial assets
56,844
52,422
1,854
968

Current
54,494 49,145
Non-current
2,350 3,277

56,844 52,422


(a) In FY2013, a subsidiary, BreadTalk Pte Ltd (BTPL) entered into an agreement to subscribe for non-convertible notes
of $550,000 in a private limited company incorporated in Singapore.The non-convertible notes carry a fixed interest
of 1.93% per annum. The notes and related accrued interest is payable in September 2016.

(b) In FY2013 BTPL also entered into an agreement to subscribe for convertible notes of 900,000 at a total issue price
of $900,000 in a private limited company incorporated in Singapore. The convertible notes carry a fixed interest of
1.93% per annum. The notes mature and accrued interest is payable in September 2016. The notes provide BTPL the
rights to convert outstanding amounts of the notes and interest by the allotment of such number of shares in the
company at the conversion rate of $1 to 1 share such that BTPL shall own 60% of the enlarged issued capital of the
company.

Trade receivables
Trade receivables are non-interest bearing and are generally on 15 to 60 days terms (2013: 15 to 60 days). They are
recognised at their original invoice amounts which represents their fair values on initial recognition.
Trade receivables denominated in foreign currencies at 31 December are as follows:-

United States Dollar

Group
2014 2013
$000 $000
599
852
1,854 968

1,854
968
Receivables that are past due but not impaired
Other receivables that are past due but not impaired
The Group has trade receivables amounting to $2,974,000 (2013: $1,862,000) that are past due at the balance sheet date
but not impaired. These receivables are unsecured and the analysis of their aging at the balance sheet date is as follows:
The Group has other receivables amounting to $906,000 (2013: $2,300,000) that are past due at the balance sheet date
but not impaired. These receivables are unsecured and the analysis of their aging at the balance sheet date is as follows:
Group

2014
2013

$000
$000

Trade receivables past due:
Lesser than 30 days
2,044
653
30 to 60 days
116
551
61 to 90 days
78
296
91 to 120 days
143
253
More than 120 days
593
109

2,974
1,862

Receivables that are impaired / partially impaired
Group

2014

$000

Other receivables past due:
Lesser than 30 days
574
30 to 60 days
184
61 to 90 days
18
91 to 120 days
5
More than 120 days
125

906

Other receivables that are impaired / partially impaired
The Groups trade receivables that are impaired at the balance sheet date and the movement of the allowance accounts
used to record the impairment are as follows:
Group

Individually impaired

2014
2013

$000
$000

Trade receivables nominal amounts
334
197

Less: Allowance for impairment
(334)
(197)

Movement in allowance accounts:

At 1 January
197
152

Charge during the year
137
197

Written off during the year

(152)

At 31 December
334
197

Trade receivables that are individually determined to be impaired at the balance sheet date relate to debtors that are in

financial difficulties and have defaulted on payments. These receivables are not secured by any collateral or credit

enhancements.

Other receivables
Other receivables (current) are non-interest bearing and are generally on 0 to 60 days terms (2013: 0 to 60 days).
2013
$000
1,041
586
19
31
623
2,300
The Groups other receivables that are impaired at the balance sheet date and the movement of the allowance accounts
used to record the impairment are as follows:
Group


2014
2013

$000
$000

Other receivables nominal amounts
5
45

(5)
(45)


At 1 January
45
34


26

Written off during the year
(40)
(14)


(1)

At 31 December
5
45

Other receivables that are individually determined to be impaired at the balance sheet date relate to debtors that are in
financial difficulties and have defaulted on payments. These receivables are not secured by any collateral or credit
enhancements.
19. Due from/to related corporations
19. Due from/to related corporations (contd)
Company

2014
2013

$000
$000

Non-current

Amounts due from:

Loan to subsidiary
1,200
1,200

Less: Impairment losses
(1,200) (1,200)

Receivables that are impaired at the balance sheet date and the movement of the allowance accounts used to record the

impairment are as follows:
Group


2014
2013

$000
$000

Amount due from joint venture (non-trade) nominal amounts
659
607

(659)
(607)


At 1 January
607

52
607

At 31 December
659
607

Receivables that are individually determined to be impaired at the balance sheet date relate to debtors that are in financial

difficulties and have defaulted on payments. These receivables are not secured by any collateral or credit enhancements.
The loan to subsidiary is quasi-capital in nature, non-interest bearing and has no fixed terms of repayment.

Group Company

2014
2013
2014
2013

$000
$000
$000
$000

Current

Amounts due from:

Subsidiaries (non-trade)

26,412 16,753

Associate (non-trade)
4

Joint ventures (trade)
143
4

Joint ventures (non-trade)
1,738
955

1,885
959
26,412 16,753

Amounts due to:

Subsidiaries (non-trade)

32,103 27,457

Associate (non-trade)
2,101
1,193

Joint ventures (trade)
2,707
2,343

Joint ventures (non-trade)
354
365

5,162
3,901
32,103 27,457

The amounts due from/to related corporations (current) are to be settled in cash, unsecured, non-interest bearing and

generally on 30 to 60 days term except for:

(i) loans to subsidiaries of $15,777,000 (2013: $8,782,000) which are repayable on demand;
(ii) loan to a joint venture of $697,000 (2013: Nil) which is repayable on demand;

(ii) loan from a subsidiary of $10,091,000 (2013: $10,275,000) which bears an effective interest rate of 0.85% (2013: NIL)
per annum and is repayable on demand;

(iii) loan from a subsidiary of $20,325,000 (2013: $15,584,000) which bears an effective interest rate of 1.5% (2013: 1.5%)
per annum and is repayable on demand.
Receivables that are past due but not impaired
Group

2014
2013

$000
$000

Amounts due from joint ventures (non-trade)

Lesser than 30 days
8
47

30 to 60 days
7

61 to 90 days
8

91 to 120 days
7

More than 120 days
43
777

Total as at 31 December
73
824

Company

2014
2013

$000
$000

Amounts due from subsidiaries (non-trade)

Lesser than 30 days
1,099
279

30 to 60 days
1,279
225

61 to 90 days
1,048

91 to 120 days
1,300

More than 120 days
2,156
5,901

6,882
6,405
20. Cash and cash equivalents, and fixed deposit
21. Assets of disposal group classified as held for sale (contd)
(a)
Balance sheet disclosures:
Group Company

2014
2013
2014
2013

$000
$000
$000
$000

Fixed deposits (current)
11,089
6

Cash on hand and at bank

84,363
79,414
3,047
9,214

95,452 79,420
3,047
9,214

Fixed deposits of the Group have a maturity period of between 1 to 9 months (2013: 1 month) with effective interest
rates of 0.05% to 4.46% (2013: 0.05% to 0.4%) per annum.
The assets classified as held for sale as at 31 December are as follows:
Cash and cash equivalents denominated in foreign currencies at 31 December are as follows:
Group Company

2014
2013
2014
2013

$000
$000
$000
$000

271
271

32

(b)
Fixed deposit (no-current)
The fixed deposit in 2013 had a maturity period of 2 years with an effective interest rate of 4.46% per annum.
21. Assets of disposal group classified as held for sale

In 2013, in conjunction with the Groups investment in Carl Karcher Enterprises (Cayman) Ltd (CKEC) (Note 15),
a wholly-owned subsidiary, Shanghai Star Food F&B Management Co., Ltd signed an Asset Purchase Agreement with
CKE (Shanghai) F&B Management Limited (a wholly-owned subsidiary of CKEC) to sell certain of its assets. The
consideration for the assets is subject to adjustment based on the variation of the book value of the assets at the dates
of transfer which is expected to occur in the next twelve months.
As at 31 December 2013, the related assets have been presented in the balance sheet as Assets of disposal group
classified as held for sale and the carrying amount for these assets is $2,056,000.The asset transfer was completed during
the year.
Group

2014

$000

Assets:

Property, plant and equipment

Inventories

Other receivables

Cash and short-term deposits

Assets of disposal group classified as held for sale

22. Trade and other payables
2013
$000
1,151
481
420
4
2,056
Group Company

2014
2013
2014
2013

$000
$000
$000
$000


Trade payables
24,985
26,100

Other payables

- Other creditors
16,141
19,886
141
412

- Payable for purchase of property,
plant and equipment
9,334
13,646

1,188

- Sales collection on behalf of
tenants
19,365 18,957

Deposits
24,671 21,624 1,052 732

Dividend payable
984
984

95,480 101,197
1,193
2,332

Non-financial liabilities

GST payable
2,195
1,392
237
337

97,675 102,589
1,430
2,669

The deposits refer to deposits from food court tenants and franchisees and stored value card deposits. Dividend is

payable to minority shareholders of a subsidiary.
22. Trade and other payables (contd)
23. Other liabilities and provision (contd)
Trade payables/other payables
These amounts are non-interest bearing. Trade payables are normally settled on 0 to 60 days terms (2013: 0 to 60 days
terms) while other payables have an average term of 0 to 90 days term (2013: 0 to 90 days terms), except for retention
sums which have repayment terms of up to 1 year.
Trade payables denominated in foreign currencies as at 31 December are as follows:
Group Company

2014
2013
2014
2013

$000
$000
$000
$000

At 1 January
10,223
7,977
22
Additions
2,169 2,926
22
Utilisation
(792) (375)

Provision no longer required
(92)
(394)

Exchange differences
173
89

11,681
10,223
22
22

Group

2014
2013

$000
$000

127
234
Others
54

23. Other liabilities and provision
Group Company

2014
2013
2014
2013

$000
$000
$000
$000

Other liabilities:

Current:

Accrued operating expenses
33,580
28,318
1,478
2,428

Accrued property, plant and equipment
1,421
3,131
1,226
2,789

Financial guarantees

576
576

35,001
31,449
3,280
5,793

Deferred revenue (current)
28,196
24,952

Deferred rent (current)
2,029
3,130

30,225 28,082

Deferred rent (non-current)
12,626
10,297

Non-financial liabilities
42,851
38,379

Current
65,226 59,531 3,280 5,793
Non-current
12,626 10,297

77,852 69,828
3,280
5,793
Provision for reinstatement costs
Provision for reinstatement costs is recognised when the Group entered into a lease agreement for the premises. It
includes the estimated cost of demolishing and removing all the leasehold improvements made by the Group to the
premises. The premises shall be reinstated to the condition set up in the lease agreements upon the expiration of the
lease agreements. During the year, the Group incurred reinstatement costs for certain closed outlets and an excess
provision of $92,000 (2013: $394,000) was reversed.
24. Due from/(to) minority shareholders of subsidiaries

The amounts due from and loan from minority shareholders of subsidiaries are to be settled in cash, unsecured, noninterest bearing and repayable on demand.
25. Short-term loans

Group

2014

$000

Bank loans

- Singapore Dollar
11,640

- Hong Kong Dollar
-

- Chinese Yuan
10,780

- Malaysia Ringgit
265

- New Taiwan Dollar
4,962

- Thailand Baht
4,720

32,367
2013
$000
2,640
491
115
3,638
2,862
9,746
25. Short-term loans (contd)
26. Long-term loans (contd)
The effective interests on these short-term loans range from 1.63% to 4.79% (2013: 1.63% to 4.79%) per annum. The
interest rates of these floating rate loans are repriced from time to time at the discretion of the respective banks.
Note 1 the term loans are secured by a charge over the Companys leasehold land and property. The loans mature in
2028. They include the following financial covenants which require the Group to maintain:
The bank loans are revolving term loans of 1 to 12 months months (2013: 1 to 12 months).
- a gearing ratio not exceeding 4.0 times
Short term loans of $Nil (2013: $491,000) are secured by continuing guarantees by the Company and certain subsidiaries
of the Group. All other short term loans are secured by continuing guarantees by the Company.
Note 2 the term loan is secured by a charge over the Companys leasehold land and property.The loans mature in 2020.
They include the following financial covenants which require the Group to maintain:
Short term loan of $10,780,000 (2013: $NIL) is secured by a charge over the subsidiarys investment property and
continuing guarantee by the Company (Note 11).
- a gearing ratio not exceeding 4.0 times
Note 3 the term loans are secured by a charge over a subsidiarys machineries and equipment. The loans mature
in 2019.
Note 4 the loan is secured by a charge over the Companys leasehold land and property and continuing guarantee by
the Company. It includes a financial covenant which requires the Group to maintain:
- a net worth exceeding the loan covenants granted; and

- a gearing ratio not exceeding 4.0 times.
Note 5 the loan is secured by certain investment securities by a subsidiary. It includes a financial covenant which requires
the Group to maintain:
- a net worth exceeding the loan covenants granted

- a gearing ratio not exceeding 4.0 times; and
- EBITDA exceeding the loan covenants granted
All other term loans are secured by continuing guarantees by the Company.
All the loans are floating rate loans with effective interest rates ranging from 1.5% to 6.88% (2013: 1.25% to 6.88%) per
annum. The interest rates of these floating rate loans are repriced from time to time at the discretion of the
respective banks.
26. Long-term loans

Group Company

Term loans Maturity
2014
2013
2014
2013
$000 $000 $000 $000

Singapore Dollar
2015 - 2019
42,118
40,900

Singapore Dollar
Note 1
47,614
48,381
47,614 48,431

Singapore Dollar
2020 (Note 2)
3,576
3,802
3,576
3,752

Singapore Dollar
2019 (Note 3)
3,334

Singapore Dollar
2019 (Note 4)
13,068
13,068

Singapore Dollar
2016 - 2019 (Note 5)
43,778
32,167

Hong Kong Dollar
2017
1,014
2,435

Chinese Yuan
2015 2016
1,769
2,542

Malaysia Ringgit
2015 2017
1,309
1,044

New Taiwan Dollar
2016
3,758
7,100

Thailand Baht
2014 2018
4,114
7,331

Current portion
Non-current
portion

165,452 158,770
51,190
52,183
43,965
20,554
4,032
3,135
121,487
138,216
47,158
49,048
51,190
52,183
165,452 158,770
27. Share capital and treasury shares
28. Accumulated profits and other reserves
(a)
Share capital
Accumulated profits

Group and Company
2014
2013

Number of
Number of

shares
$000 shares $000

Issued and fully paid ordinary
shares

At beginning and end of the year
281,893,238
33,303 281,893,238 33,303

The holders of ordinary shares (except treasury shares) are entitled to receive dividends as and when declared by
the Company. All ordinary shares carry one vote per share without restrictions.The ordinary shares have no par value.
Included in the Groups accumulated profits is an amount of $1,432,000 (2013: $1,432,000) which is not distributable
by way of dividends. The amount arose from the waiver of inter-company debt in the subsidiary, Beijing BreadTalk
Restaurant Management Co., Ltd, which was recognised as capital reserve in accordance with local accounting convention.
Other reserves
(b)
Treasury shares

Group and Company
2014
2013

Number of
Number of

shares
$000 shares $000

At beginning of the year
381,624
(187)
829,614
(406)
Acquired during the financial
483,000
(569)

year
(861,534) (1) 753 (447,990) 219
share grant

At end of the year
3,090
(3)
381,624
(187)

Treasury shares relate to ordinary shares of the Company that is held by the Company.
The Company acquired 483,000 (2013: Nil) shares in the Company through purchases on the Singapore Exchange
during the financial year. The total amount paid to acquire the shares was $569,000 (2013: $Nil) and this was
presented as a component within shareholders equity.
Group Company

Note
2014
2013
2014
2013

$000
$000
$000
$000

Statutory reserve fund
(a)
2,864
2,757

Translation reserve
(b)
2,309
666

Fair value adjustment reserve
(c)

111

Share-based compensation
reserve
356
286
356
286

Capital reserve
(d)
307
175
307
175

Premium on acquisition of non controlling interests
(e)
(1,149)
(657)

4,687
3,338
663
461

(a)
Statutory reserve fund

In accordance with the Foreign Enterprise Law applicable to subsidiaries in the Peoples Republic of China (PRC),
the subsidiaries are required to make appropriation to a Statutory Reserve Fund (SRF). At least 10% of the
statutory after tax profits as determined in accordance with the applicable PRC accounting standards and regulations
must be allocated to the SRF until the cumulative total of the SRF reaches 50% of the subsidiaries registered capital.
Subject to the approval from the relevant PRC authorities, the SRF may be used to offset any accumulated losses or
increase the registered capital of the subsidiaries. The SRF is not available for dividend distribution to shareholders.
(b)
Translation reserve
The foreign currency translation reserve is used to record exchange differences arising from the translation of the
financial statements of foreign operations whose functional currencies are different from that of the Groups presentation
currency.
The Company reissued 861,534 (2013: 447,990) treasury shares pursuant to its restricted share grant at a weighted
average share price of approximately $0.87 (2013: $0.49) each.

(1) Includes 488,767 treasury shares released to Mr Ong Eng Lock, the Gropu Chief Executive Officer, as an award of

service quality.
28. Accumulated profits and other reserves (contd)
29. Commitments and contingencies
(c)
Fair value adjustment reserve
(a)
Commitments
Fair value adjustment reserve represents the cumulative fair value changes, net of tax, of available-for-sale financial
assets until they are disposed of or impaired.
Expenditure contracted for as at the balance sheet date but not recognised in the financial statements is as follows:
Group

2014
2013

$000
$000

Net loss on available-for-sale financial assets:

- Net loss on fair value changes during the financial year
(111)
103

(d)
Capital reserve
Capital reserve mainly arises from the gain or loss arising from purchase, sale, issue or cancellation of treasury shares.
No dividend may be paid and no other distribution (whether in cash or otherwise) of the Companys assets (including
any distribution of assets to members on a winding up) may be made in respect of this reserve.
(e)
Premium on acquisition of non-controlling interests
Group

2014
2013

$000
$000

At 1 January
657
657
Decrease in equity attributable to non-controlling interests (Note 14)
492

At 31 December
1,149
657
Group Company

2014
2013
2014
2013

$000
$000
$000
$000

Commitment in respect of
property, plant and equipment
369
4,529

237

Commitment in respect of
investment securities
500
500

(b)
Contracted operating lease commitments

The Group has various operating lease agreements for equipment, office, central kitchen, food court and retail outlet
premises. These non-cancellable leases have remaining non-cancellable lease terms of between less than 1 year and 9
years. Most leases contain renewable options. Some of the leases contain escalation clauses and provide for contingent
rentals based on percentages of sales derived from assets held under operating leases. Lease terms do not contain
restrictions on the Groups activities concerning dividends, additional debt or further leasing.
Future minimum lease payments payable under non-cancellable operating leases as at 31 December are as follows:
Group

2014
2013

$000
$000

Not later than one year
125,833 90,633
Later than one year but not later than five years
261,606 210,440
Later than five years
35,111 27,189

422,550 328,262
29. Commitments and contingencies (contd)
30. Related party disclosures
(c)
Operating lease
(a)
Sale and purchase of goods and services
The Group has entered into non-cancellable operating leases to sublease its food court and retail outlet premises.
The Company has non-cancellable operating leases for its leasehold property. Future sublease rental receivable as at
31 December is as follows:
In addition to those related party information disclosed elsewhere in the financial statements, the following significant
transactions between the Group and related parties took place during the year on terms agreed between the parties:
Group Company

2014
2013
2014
2013

$000
$000
$000
$000

Not later than one year
72,107
56,966
5,868
3,144
Later than one year but not
later than five years
43,005
51,321
5,288
5,100
Over five years

83

115,112 108,287
11,156
8,327

(d)
Corporate guarantees
As at 31 December 2014, the Company has given corporate guarantees to financial institutions in connection with
banking facilities provided to its subsidiaries of which $148,305,000 (2013: $130,860,000) of the banking facilities
have been utilised as at year end.
(e)
Undertakings

3% SGD junior bonds

In conjunction with the investment in junior bonds by the subsidiary, Imagine Properties Pte Ltd (IPPL) (Note 13),
the Company, together with the other investors of the junior bonds, had executed a Sponsors Undertaking on 30
January 2012 whereby IPPL undertakes to pay all cost overruns in connection to the additions and alterations works
to be undertaken on Chijmes. As at 31 December 2014, there were no contingent liabilities resulting from the
aforesaid undertaking.
Group

2014
2013

$000
$000

Income

Management fee income from a joint venture
782
792
Franchise fee income from a joint venture
125
Rental and miscellaneous income from a joint venture

125
Rental and miscellaneous income from a party related to

a director of the Company
230
314
Sales of goods to a joint venture and an associate
688
721
Purchase of goods from a joint venture
11,641
9,950

Expenses

Rental expense to a joint venture
93
324
Logistics service fee paid/payable to a company related to
a director of the Company
1,872
1,958
Royalty fees to minority shareholders
3,346
2,795
Purchase of goods from a party related to a director of
the Company

85
Design fee paid/payable to minority shareholders of
subsidiaries
47
Repair and maintenance fees to an associate

367
Miscellaneous expense

99

Others

Franchise fee to non-controlling interests
52
128
Purchase of furniture and fittings from a company related
to a director of the Company
492
769
Purchase of furniture and fittings from minority shareholders of
subsidiaries
232
Purchase of plant and equipment from an associate

10,885 11,065
Sale of plant and equipment to a joint venture
2,268
30. Related party disclosures (contd)
31. Financial risk management objectives and policies
Company

2014
2013

$000
$000

Income

Management fee income from a subsidiary
13,407 11,821
Dividend income from subsidiaries
13,711 12,075
Training fee income from subsidiaries
269
212
Rental income from subsidiaries
4,707
2,443

Expense

Purchase of goods from subsidiaries

10
Interest expense payable to a subsidiary
367
243
Miscellaneous expense payable to a subsidiary
113
71
Miscellaneous expense payable to an associate
7
10

Others

Purchase of plant and equipment from an associate
19
4,672

(b)
Compensation of key management personnel

Group

2014
2013

$000
$000

Salaries and bonus
6,061
7,082
Central Provident Fund contributions and other
pension contributions
338
329
Share-based payment (RSG Plan)
500
215
Directors fees
168
168
Other personnel expenses
1,225
1,106

Total compensation paid to key management
personnel
8,292
8,900

Comprise amounts paid to:

Directors of the Company
1,166
1,560
Directors of a subsidiary
784
1,546
Other key management personnel
6,342
5,794

8,292
8,900
The Group and the Company is exposed to financial risks arising from its operations and the use of financial instruments.
The key financial risks include interest rate risk, foreign currency risk, credit risk, liquidity risk and market price risk. The
Audit Committee provides independent oversight to the effectiveness of the risk management process. It is, and has been
throughout the current and previous financial year, the Groups policy that no trading in derivatives for speculative
purposes shall be undertaken.
The following sections provide details regarding the Groups and Companys exposure to the above-mentioned financial
risks and the objectives, policies and processes for the management of these risks.
There has been no change to the Groups exposure to these financial risks or the manner in which it manages and
measures the risks.
The Groups and Companys principal financial instruments comprise bank loans and cash and short term deposits. The
main purpose of these financial instruments is to raise finance for the Groups and Companys operations.The Group and
Company has various other financial assets and liabilities such as trade and other receivables, trade and other payables
and related company balances, which arise directly from its operations.
(a) Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of the Groups and the Companys financial
instruments will fluctuate because of changes in market interest rates.

The Groups and the Companys exposure to interest rates risk arises primarily from its investment portfolio in fixed
deposits and its debt obligations. The Group does not use derivative financial instruments to hedge its investment
portfolio. The Group obtains additional financing through bank borrowings. The Groups policy is to obtain the most
favourable interest rates available without increasing its foreign exchange exposure.
Surplus funds are placed with reputable banks.

Sensitivity analysis for interest rate risk

Group

Effect on profit before tax
100 basis
100 basis

points
points
increase
decrease

$000
$000
2014

- Singapore dollar interest rates
(1,651)
1,651
- Chinese Yuan interest rates
(19)
19
- Hong Kong dollar interest rates
(10)
10
- New Taiwan dollar interest rates
(87)
87
- Malaysia Ringgit interest rates
(16)
16
- Thailand Baht interest rates
(88)
88

31. Financial risk management objectives and policies (contd)
(a) Interest rate risk (contd)

Group

100 basis
100 basis

points
points
increase
decrease

$000
$000

2013

- Singapore dollar interest rates
(1,410)
1,410
- Chinese Yuan interest rates
81
(81)
- Hong Kong dollar interest rates
(29)
29
- New Taiwan dollar interest rates
(107)
107
- Malaysia Ringgit interest rates
(12)
12
- Thailand Baht interest rates
(102)
102

(b) Foreign currency risk

The Group has transactional currency exposures arising from sales, purchases and borrowings that are denominated
in a currency other than the respective functional currencies of Group entities, primarily SGD, Chinese Yuan (CNY)
and Hong Kong Dollar (HKD).The foreign currencies in which these transactions are denominated are mainly United
States dollars (USD), HKD, CNY and SGD.
The Group is also exposed to currency translation risk arising from its net investments in foreign operations, in
Malaysia, the PRC, Hong Kong and Thailand. The Groups net investments in these countries are not hedged as
currency positions in Malaysia Ringgit, CNY, HKD and Thailand Baht are considered to be long-term in nature.
Sensitivity analysis for foreign currency risk
The following table demonstrates the sensitivity of the Groups profit before tax to a reasonably possible change in
the USD, HKD, CNY and SGD exchange rates against the respective functional currencies of the Group entities, with
all other variables held constant.
(b) Foreign currency risk (contd)
Group

2014 2013
$000 $000
Against SGD:

USD - strengthened 6% (2013: 6%)
130
56

- weakened 6% (2013: 6%)
(130)
(56)

CNY - strengthened 5% (2013: 5%)
440
363

- weakened 5% (2013: 5%)
(440)
(363)

Against CNY:

SGD - strengthened 5% (2013: 5%)
(38)
(21)

- weakened 5% (2013: 5%)
38
21

HKD - strengthened 5% (2013: 5%)
(46)
(52)

- weakened 5% (2013: 5%)
46
52

Against HKD

(203)
(124)

- weakened 5% (2013: 5%)
203
124

Against Thailand Baht

- weakened 5% (2013: 5%)

Against New Taiwan Dollar
78
(78)
SGD

83
(83)
- strengthened 5% (2013: 5%)

- weakened 5% (2013: 5%)
(c)
Credit risk
Excessive risk concentration
Credit risk is the risk of loss that may arise on outstanding financial instruments should a counterparty default on its
obligations. The Groups and the Companys exposure to credit risk arises primarily from trade and other receivables.
For other financial assets (including investment securities, cash and cash equivalents), the Group and the Company
minimise credit risk by dealing exclusively with high credit rating counterparties.
The Group trades only with recognised and creditworthy third parties. It is the Groups policy that all customers who
wish to trade on credit terms are subject to credit verification procedures. In addition, receivable balances are
monitored on an ongoing basis with the result that the Groups exposure to bad debts is not significant.
Exposure to credit risk
At the balance sheet date, the Groups and the Companys maximum exposure to credit risk is represented by:
the carrying amount of each class of financial assets recognised in the balance sheets; and
an amount of $148,305,000 (2013: $130,860,000) relating to corporate guarantees provided by the Company

to financial institutions on its subsidiaries borrowings and other banking facilities.
In order to avoid excessive concentration of risk, the Groups policies and procedures include specific guidelines to focus
on maintaining a diversified portfolio. Identified concentrations of credit risks are controlled and managed accordingly.
Financial assets that are neither past due nor impaired
Trade and other receivables that are neither past due nor impaired are creditworthy debtors with good payment record
with the Group. Cash and cash equivalents are placed with or entered into with reputable financial institutions or
companies with high credit ratings and no history of default.
Financial assets that are either past due or impaired
Information regarding financial assets that are either past due or impaired is disclosed in Notes 18 and 19 above.
Credit risk concentration profile
The Group determines concentrations of credit risk by monitoring the country profile of its trade receivables, other
receivables and deposits on an on-going basis. The credit risk concentration profile of the Groups trade receivables,
other receivables and deposits at the balance sheet date is as follows:

Group
2014 2013

% of

$000
total
$000

By country:
Singapore
22,320
39%
20,509
Peoples Republic of China
22,686
39%
20,190
Hong Kong
7,230
13%
5,349
Malaysia
619
1%
504
Indonesia
533
1%
667
The Philippines
492
1%
1,223
Thailand
1,341
2%
1,717
Taiwan
2,022
3%
1,863
Others
298
1%
400

57,541
100%
52,422
% of
total
Concentration arise when a number of outer parties are engaged in similar business activities, or activities in the same
geographical region, or have economic features that would cause their ability to meet contractual obligations to be
similarly affected by changes in economic, political or other conditions. Concentrations indicate the relative sensitivity of
the Groups performance to developments affecting a particular industry.
(d) Liquidity risk

Liquidity risk is the risk that the Group or the Company will encounter difficulty in meeting financial obligations due to
shortage of funds. The Groups and the Companys exposure to liquidity risk arises primarily from mismatches of the
maturities of financial assets and liabilities.The Groups and the Companys objective is to maintain a balance between
continuity of funding and flexibility through the use of stand-by credit facilities.
The Group monitors and maintains a level of cash and cash equivalents deemed adequate by the management to
finance the operations of the Group.
Short-term funding may be obtained from short-term loans where necessary.
39%
39%
10%
1%
1%
2%
3%
4%
1%
100%

The table below shows the contractual expiry by maturity of the Companys contingent liabilities. The maximum amount of the financial guarantee contracts are allocated to the earliest
period in which the guarantee could be called.

2014
2013

1 year or
1 to 5
1 year or
1 to 5

less
years
Total
less
years
Total
Company $000
$000 $000 $000
$000
$000

Financial guarantees 87,044 61,261 148,305 41,692 89,168
130,860

2014
2013

1 year or
1 to 5
Over 5
1 year or
1 to 5
Over 5

less
years
years
Total
less
years
years
Total
Company
$000 $000 $000 $000
$000
$000 $000 $000
Financial assets :

Other receivables
1,854

1,854
968

968

Amounts due from related corporations
26,412

26,412
16,753

16,753

Cash on hand and at bank
3,047

3,047
9,214

9,214

Total net undiscounted financial
assets
31,313

31,313 26,935
26,935

Financial liabilities :

Other payables
1,193

1,193
2,332

2,332

Other liabilities
3,280

3,280
5,793

5,793

Amounts due to related corporations
32,494

32,494
27,691

27,691

Loans and borrowings
4,094
21,727
30,361
56,182
3,178
14,841
39,636
57,655

liabilities
41,061
21,727 30,361
93,149
38,994
14,841 39,636 93,471

liabilities
(9,748)
(21,727) (30,361)
(61,836)
(12,059)
(14,841) (39,636) (66,536)
(d)
Liquidity risk (contd)


(d) Liquidity risk (contd)

The table below summarises the maturity profile of the Groups and the Companys financial assets and financial liabilities at the balance sheet date based on contractual

undiscounted payments:

2014
2013

1 year or
1 to 5
Over 5
1 year or
1 to 5
Over 5

less
years
years
Total
less
years
years
Total
Group
$000 $000 $000 $000
$000
$000 $000 $000
Financial assets :

Investment securities

80,945

80,945

60,427

60,427

54,494
2,420

56,914
49,145
3,281

52,426

1,885

1,885
959

959

Amounts due from minority
shareholders of subsidiaries
518

518
395

395

Cash and fixed deposits
95,452

95,452
79,420
11,504

90,924

Total undiscounted financial assets
152,349 83,365
235,714 129,919
75,212
205,131

Financial liabilities :

95,480

95,480
101,197

101,197

Other liabilities
35,001

35,001
31,449

31,449

5,162

5,162
3,901

3,901

Loans and borrowings
45,895
135,660
30,839
212,394
30,430
110,405
40,059
180,894

Total undiscounted financial
liabilities
181,538
135,660
30,839 348,037 166,977 110,405
40,059
317,441

liabilities
(29,189)
(52,295)
(30,839)
(112,323) (37,058) (35,193)
(40,059)
(112,310)
33. Fair value of assets and liabilities
Fair value hierarchy
The Group categories fair value measurements using a fair value hierarchy that is dependent on the valuation inputs used
as follows:
(e) Market price risk
Market price risk is the risk that the fair value or future cash flows of the Groups financial instruments will fluctuate
because of changes in market prices (other than interest or exchange rates). The Group is exposed to equity price
risk arising from its investment in quoted equity instrument. This instrument is quoted on the SGX-ST in Singapore
and is classified as available-for-sale financial asset. The Group does not have exposure to commodity price risk.
Sensitivity analysis for equity price risk

At the balance sheet date, if the share price had been 15% (2013: 15%) higher/lower with all other variables held
constant, the effect on the Groups profit before tax would be $36,000 (2013: $64,000) higher/lower, arising as a
result of an increase/decrease in the fair value of equity instruments classified as available-for-sale.

- Level 1 Quoted prices (unadjusted) in active market for identical assets or liabilities that the Group can access at
the measurement date,

- Level 2 Inputs other that quoted prices included within Level 1 that are observable for the asset or liability, either
directly or indirectly, and

- Level 3 Unobservable inputs for the asset or liability.
32. Financial instruments
Fair value measurements that use inputs of different hierarchy levels are categorised in its entirety in the same level of the
fair value hierarchy as the lowest level input that is significant to the entire measurement.
(a)
Assets and liabilities measured at fair value
The carrying amount by category of financial assets and liabilities are as follows:
Group Company

2014
2013
2014
2013

$000
$000
$000
$000

Loans and receivables

(Note 18)
56,844
52,422
1,854
968

1,885
959
26,412 16,753

Amounts due from minority shareholders of subsidiaries
(non-trade)
518
395

Cash and fixed deposits
95,452
90,091
3,047
9,214

Total
154,699 143,867
31,313 26,935


Investment securities (Note 13)
39,821
34,575


Investment securities (Note 13)
37,361
25,224

Financial liabilities carried at
amortised cost

Trade and other payables (Note 22)
95,480 101,197
1,193
2,332

Other liabilities (Note 23)
35,001
31,449
3,280
5,793

5,162
3,901
32,103 27,457

Short term loans
32,367
9,746

Long term loans (Note 26)
165,452 158,770
51,190 52,183

a subsidiary
676
200

Total
334,138 305,263
87,766 87,765
The following table shows an analysis of each class of assets and liabilities measured at fair value by level at the end
of the reporting period:

Group

Quoted
prices in active markets

for identical instruments

(Level 1)

2014 2013

$000
$000

Recurring fair value measurements

Financial assets:

Available-for-sale financial assets (Note 13)

- Equity instruments (quoted)
239
425

At 31 December
239
425

Level 1 fair value

Equity securities (quoted) (Note 13): Fair value is determined by direct reference to their bid price quotations in an active
market at the end of the reporting period.
33. Fair value of assets and liabilities (contd)
33. Fair value of assets and liabilities (contd)
(b)
Assets and liabilities not carried at fair value but for which fair value is disclosed
(b)
Assets and liabilities not carried at fair value but for which fair value is disclosed (contd)

Determination of fair value
The following table shows an analysis of the Groups assets and liabilities not measured at fair value at 31 December
2014 but for which fair value is disclosed:

Group

2014

$000

Fair value measurements at the end

of the reporting period

Significant

observable

inputs other
Significant

than quoted
unobservable Carrying

prices
inputs
amount

(Level 2)
(Level 3)
Assets

Investment in junior bonds (Note 13)

38,520
37,361

2,186
2,350
Investment property
23,199

23,135

Liabilities

Loan from a minority shareholder of a
subsidiary

444
476

Assets
Fixed deposit (non-current)
Group
2013
$000
Fair value
measurements at the
end of the reporting
period
Significant
unobservable Carrying
inputs amount
(Level 3)

25,852
25,244
2,907
3,277
10,232
10,671

Investment in junior bonds, other receivables (non-current), fixed deposits and loan from minority shareholder of
a subsidiary
Fair value is estimated by discounting expected future cash flows at market incremental lending rate for similar types
of borrowing or leasing arrangements at the balance sheet date.
Investment property
The valuation of commercial instrument property is based on comparable market transactions that consider sales of
similar properties that have been transacted in the open market.
(c)
Fair value of financial instruments by classes that are not carried at fair value and whose carrying amounts are not
reasonable approximation of fair value
The fair value of financial assets and liabilities by classes that are not carried at fair value and whose carrying amounts
are not reasonable approximation of fair value are as follows:

Carrying amount

2014 2013

$000 $000
Group

Financial assets:
Equity instruments (unquoted),
at cost
39,582 34,150
37,361 25,244
Other receivables
2,350 3,277
Fixed deposit
10,671

Financial liabilities:
Loan from a minority shareholder of a subsidiary
476

Fair value
2014
2013
$000
$000
*
38,520
2,186

*
25,852
2,907
10,232
444
* Investment in equity instruments (unquoted) at cost

Fair value information has not been disclosed for the Groups investments in equity instruments that are carried at
cost because fair value cannot be measured reliably.These equity instruments represent ordinary shares in companies
that are not quoted on any market. The Group does not intend to dispose of these investments in the foreseeable
future.
34. Capital management
35. Segment information
Capital includes debt and equity items as disclosed in the table below.
The primary objective of the Groups capital management is to ensure that it maintains a strong credit rating and healthy
capital ratios in order to support business and maximise shareholder value.
The Group manages its capital structure and makes adjustments to it, in the light of changes in economic conditions.
To maintain or adjust the capital structure, the Group may adjust the dividend payment to shareholders, return capital to
shareholders or issue new shares. No changes were made in the objectives, policies or processes during the year ended
31 December 2014 and 2013.
As disclosed in Note 28, subsidiaries of the Group operating in the PRC are required by the Foreign Enterprise Law of
the PRC to contribute to and maintain a non-distributable statutory reserve fund whose utilisation is subject to approval
by the relevant PRC authorities. This externally imposed capital requirement has been complied with by the respective
subsidiaries for the financial year ended 31 December 2014 and 2013.
The Group monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. The Groups
policy is to keep the gearing ratio between 60% and 80%.The Group includes within net debt, loans and borrowings, trade
and other payables, amounts due to related corporations, less cash and short-term deposits. Capital includes equity
attributable to the owners of the Company less the fair value adjustment reserve and restricted statutory reserve fund.
For management purposes, the Group is organised into business units based on their products and services, and has three
reportable operating segments as follows:

(a) The bakery segment is in the business of manufacturing and retailing of all kinds of food, bakery and confectionary
products including franchising.

(b) The food court segment is involved in the management and operation of food courts and food and drinks outlets.
(c) The restaurant segment is in the business of operating food and drinks outlets, eating houses and restaurants.
Except as indicated above, no operating segments have been aggregated to form the above reportable operating
segments.
Management monitors the operating results of its business units separately for the purpose of making decisions about
resource allocation and performance assessment. Segment performance is evaluated based on operating profit
or loss.
Transactions between operating segments are generally based on terms determined on commercial basis.
Group

2014
2013

$000
$000

Loans and borrowings (1) 198,495 168,716

97,675 102,589

5,162
3,901

Less: Cash and cash equivalents
(95,452) (79,420)

Net debt
205,880 195,786

Equity attributable to the owners of the Company
102,502 93,953

Less: - Fair value adjustment reserve

(111)
- Statutory reserve fund
(2,864) (2,757)

Total capital
99,638 91,085

Capital and net debt
305,518 286,871

Gearing ratio
67%
68%

(1) including bank loans and loans from minority shareholders of subsidiaries

35. Segment information (contd)

Food

Bakery
Restaurant
court
2014
operations (1) operations operations Investment Others (2) Elimination Group

$000 $000 $000 $000 $000 $000
$000

Revenue

External sales
294,128
130,735
164,781

589,644

Inter-segment sales
(Note A)
406
4
3,428

(3,838)

Total revenue
294,534
130,739
168,209

(3,838) 589,644

Results

Profit from operations 7,225
12,718
5,527
338
(885)

24,923

Interest income
798
346
521
1,133
12
(752)
2,058

Interest expense
(911)
(168)
(844)
(1,285)
(1,256)
736
(3,728)

Share of associates
results

(1,252)

167

(1,085)

Share of joint
ventures results
442

203

645

Segment profit/(loss)
7,554
11,644
5,407
186
(1,962)
(16)
22,813

Tax expense
(6,760)

Profit for the year 16,053

Assets and
liabilities

Segment assets
(Note A)
196,148
81,300
127,036
102,256
107,945
(103,610) 511,075

Tax recoverable
8

Deferred tax assets
4,970

Total assets
516,053

Segment liabilities
(Note A)
160,014
61,304
116,122
77,857
79,226
(103,658) 390,865

Tax payable
6,825

2,619

Total liabilities
400,309

Other information

Investment in
associates

3,033

3,033

Investment in joint
ventures
7,188

820

227

8,235

Additions to non current assets
(Note B)
19,619
6,942
12,725
23,153
4,680

67,119

Depreciation and
amortisation
15,747
8,321
18,626

3,243

45,937

Other non-cash
(income)/
expenses
(Note C)
(89)
1,434
926

954

3,225

Food

Bakery
Restaurant
court
2013
operations (1) operations operations Investment Others (2) Elimination Group

$000 $000 $000 $000 $000 $000
$000

Revenue

External sales
271,320
122,203
143,007

536,530

Inter-segment sales
(Note A)
375
2
3,045

(3,422)

Total revenue
271,695
122,205
146,052

(3,422)
536,530

Results

Profit from operations 11,145
9,019
4,873
(22)
(2,092)

22,923

Interest income
615
280
331
558
45
(513)
1,316

Interest expense (487) (52) (884)
(992) (773) 513
(2,675)

Share of associates
results

(193)

424

231

Share of joint
ventures results
329

266

595

Segment profit/(loss) 11,602
9,054
4,586
(456)
(2,396)

22,390

Tax expense
(6,251)

Profit for the year
16,139

Assets and
liabilities

Segment assets
(Note A)
152,040
76,681
147,344
60,177
99,675
(71,958)
463,959

Tax recoverable
6

Deferred tax assets
4,287

Total assets
468,252

Segment liabilities
(Note A)
111,901
38,795
133,654
59,057
86,578
(74,728)
355,257

Tax payable
6,458

2,554

Total liabilities
364,269

Other information

Investment in
associates

2,869

1,699

4,568

Investment in joint

ventures 2,773 638 227
3,638

Additions to non current assets

(Note B)
30,564 17,711 28,299 31,396

107,970

Depreciation and
amortisation
12,791
8,313
16,696

1,538

39,338

Other non-cash
(income)/
expenses
(Note C)
143
406
1,070

183

1,802

36. Dividends
Notes:
(A) Inter-segment sales, assets and liabilities are eliminated on consolidation.

Dividends paid during the year:

Dividends on ordinary shares

Final exempt (one-tier) ordinary dividend for 2013 of 1.3
cents per share (2013: dividend for 2012 of 0.8 cent per share)

Interim exempt (one-tier) dividend for 2014 of 0.5 cent per
share (2013: 0.5 cent per share)

Proposed but not recognised as a liability as at 31 December:

Dividends on ordinary shares, subject to shareholders
approval at the Annual General Meeting:

First and final exempt (one-tier) ordinary dividend for 2014
of 1.0 cent per share (2013: 1.3 cent per share)

(B) Additions to non-current assets consist of additions to property, plant and equipment, investment property and
intangible assets.

(C) Other non-cash (income)/expenses consist of:
impairment/(write-back of impairment) of property, plant and equipment, intangible assets, investment in associate,
receivables, amount due from associates and joint ventures, and provision for reinstatement cost;
write off of property, plant and equipment, bad debts and inventories;
(gain)/loss on disposals of property, plant and equipment and intangible assets;
share based payment expenses; and
unrealised foreign exchange (gain)/loss.
Geographical information
Revenue and non-current assets information based on the geographical location of customers and assets respectively are
as follows:

External sales
Non-current assets (3)

2014
2013
2014 2013

$000
$000
$000 $000

Singapore
296,212 270,569
144,438 145,680

Mainland China
186,201
172,652
76,382 53,102

Hong Kong
67,130
53,141
13,878 12,188

Rest of the world
40,101
40,168
16,816 22,662

Total
589,644
536,530
251,514 233,632

(1) Bakery operations comprise operation of bakery retail outlets as well as that operated through franchising.

(2) The business segment Others comprises the corporate services, treasury functions, investment holding activities

and dormant associated company.
(3) Non-current assets information presented above consist of property, plant and equipment, investment property and

intangible assets.
Group and Company

2014 2013
$000 $000
3,662
2,252
1,409
1,408
5,071 3,660
2,800
3,700
2,800 3,700
37. Events subsequent to the balance sheet date

Investment in commercial and retail property trust in Singapore
On 29 January 2015, the subsidiary, Imagine Properties Pte Ltd, executed a letter of participation to subscribe for
$20,072,000 in principal amount of junior bonds and ordinary shares of Perennial 8 Shenton Investors Pte Ltd in relation
to the investment in a commercial and retail property trust in Singapore.
Capital call
On 10 February 2015, the shareholders of CKEC unanimously agreed to increase the companys share capital by
USD 6,000,000. Proportionate to its shareholdings of 40% in CKEC, a wholly owned subsidiary, Star Food Pte Ltd is
committed to inject additional capital of USD2,400,000 upon call.
38. Authorisation of financial statements

The financial statements for the year ended 31 December 2014 were authorised for issue in accordance with a resolution
of the directors on 30 March 2015.
S TAT I S T I C S O F S H A R E H O L D I N G S
As at 19 March 2015
Issued and fully Paid-up Capital
33,303,000
(excluding treasury share)
281,890,148
Number of Treasury Shares held
3,090
Substantial Shareholders
Class of Shares
Ordinary
Voting Right
One vote per share
(as recorded in the Register of Substantial Shareholders as at 19 March 2015 )
Based on information available to the Company as at 19 March 2015 approximately 30.05% of the Companys shares are held
in the hands of public. Accordingly, the Compay has complied with the Rule 723 of the Listing Mannual of SGX-ST.
Number of Ordinary Shares in Issue
Substantial Direct Interest Deemed Interest

Shareholders
Number of Shares
%
Number of Shares
%
Distribution of Shareholdings

Size of Shareholdings
1 - 99
No. of
Shareholders
100 - 1,000
1,001 - 10,000
287
No. of Shares
0.37
221
N.M
13.36
227,144
0.08
1,335
62.12
6,819,647
2.42
10,001 - 1,000,000
501
23.31
26,257,582
9.31
18
0.84
248,585,554
88.19
2,149
100.00
281,890,148
100.00
1,000,001 a nd above
Total
George Quek Meng Tong(1)
95,687,660
33.95%
52,415,020
18.59%
Katherine Lee Lih Leng(1)
52,415,020
18.59%
95,687,660
33.95%
Primacy Investment Limited
31,037,900
11.01%
Paradice Investment Management LLC
14,116,924
5.01%
(1) Katherine Lee Lih Leng is the spouse of George Quek Meng Tong. Saved as disclosed above, there are no family relationship
among our Directors and Substantial Shareholders.
Twenty Largest Shareholders

No. Name
No. of Shares
1.
CITIBANK NOMINEES SINGAPORE PTE LTD
37,851,477
13.43
2.
KATHERINE LEE LIH LENG
32,542,245
11.54
3.
DBS VICKERS SECURITIES (SINGAPORE) PTE LTD
31,032,200
11.01
4.
UNITED OVERSEAS BANK NOMINEES (PRIVATE) LIMITED
29,076,714
10.31
5.
MAYBANK NOMINEES (SINGAPORE) PRIVATE LIMITED
26,030,000
9.23
6.
HONG LEONG FINANCE NOMINEES PTE LTD
18,520,600
6.57
7.
RAFFLES NOMINEES (PTE) LIMITED
17,190,300
6.10
8.
GEORGE QUEK MENG TONG
13,634,885
4.84
9.
HL BANK NOMINEES (SINGAPORE) PTE LTD
9,180,000
3.26
10. PHILLIP SECURITIES PTE LTD
7,169,300
2.54
11. DBS NOMINEES (PRIVATE) LIMITED
6,776,800
2.40
12. SBS NOMINEES PRIVATE LIMITED
5,000,000
1.77
13. DBSN SERVICES PTE. LTD.
4,186,383
1.49
14. HSBC (SINGAPORE) NOMINEES PTE LTD
3,324,750
1.18
15. PARAMOUNT ASSETS INVESTMENTS PTE LTD
2,552,000
0.91
16. BANK OF SINGAPORE NOMINEES PTE. LTD.
1,630,000
0.58
17. UOB KAY HIAN PRIVATE LIMITED
1,488,700
0.53
18. LIOW SIEW PIENG
1,399,200
0.50
19. MAYBANK KIM ENG SECURITIES PTE. LTD.
875,180
0.31
20. LEE PINEAPPLE COMPANY PTE LTD
800,000
0.28
250,260,734
88.78

Total:
N OT I C E O F A N N U A L G E N E R A L M E E T I N G
NOTICE IS HEREBY GIVEN that the Annual General Meeting of BreadTalk Group Limited (the Company) will be held at 30
Tai Seng Street, #09-01 BreadTalk IHQ, Singapore 534013 on Wednesday, 22 April 2015 at 9.30 a.m. for the following purposes:
To receive and adopt the Directors Report and the Audited Financial Statements of the Company for the year ended 31
December 2014 together with the Auditors Report thereon.

2.

(Resolution 2)
3.

To re-elect the following Directors retiring pursuant to Article 104 of the Companys Articles of Association:
Ms Katherine Lee Lih Leng
(Resolution 3)
Mr Ong Kian Min
(Resolution 4)
Mr Ong Kian Min will, upon re-election as an Independent Director of the Company, remain as the Lead Independent
Non-executive Director, Chairman of the Audit and Nominating Committees and a member of the Remuneration
Committee. Mr Ong will be considered independent for the purposes of Rule 704(8) of Listing Manual of the Singapore
Exchange Securities Trading Limited.
4. To approve the payment of Directors fees of S$172,950 for the year ended 31 December 2014 (2013: S$168,000).

(Resolution 5)
5. To re-appoint Messrs Ernst & Young LLP as the Auditors of the Company and to authorise the Directors of the Company

to fix their remuneration.

(Resolution 6)

6.
To transact any other ordinary business which may properly be transacted at an Annual General Meeting.
AS SPECIAL BUSINESS
To consider and if thought fit, to pass the following resolutions as Ordinary Resolutions, with or without any modifications:

7.
Authority to issue shares
That pursuant to Section 161 of the Companies Act, Cap. 50 and Rule 806 of the Listing Manual of the Singapore
Exchange Securities Trading Limited (SGX-ST), the Directors of the Company be authorised and empowered to:
(a) (i) issue shares in the Company (shares) whether by way of rights, bonus or otherwise; and/or
(ii) make or grant offers, agreements or options (collectively, Instruments) that might or would require shares to be
issued, including but not limited to the creation and issue of (as well as adjustments to) options, warrants,
debentures or other instruments convertible into shares,
provided that:
(Resolution 1)
To declare a final dividend of 1.0 cent per share tax exempt (one-tier) for the year ended 31 December 2014
(2013: 1.3 cents).
at any time and upon such terms and conditions and for such purposes and to such persons as the Directors of the
Company may in their absolute discretion deem fit; and

(b) (notwithstanding the authority conferred by this Resolution may have ceased to be in force) issue shares in pursuance of
any Instruments made or granted by the Directors of the Company while this Resolution was in force,
AS ORDINARY BUSINESS
1.

(1)

the aggregate number of shares (including shares to be issued in pursuance of the Instruments, made or granted pursuant
to this Resolution) to be issued pursuant to this Resolution shall not exceed fifty per centum (50%) of the total number
of issued shares (excluding treasury shares) in the capital of the Company (as calculated in accordance with sub-paragraph
(2) below), of which the aggregate number of shares to be issued other than on a pro rata basis to shareholders of the
Company shall not exceed twenty per centum (20%) of the total number of issued shares (excluding treasury shares) in
the capital of the Company (as calculated in accordance with sub-paragraph (2) below);

(2)

(subject to such calculation as may be prescribed by the SGX-ST) for the purpose of determining the aggregate number
of shares that may be issued under sub-paragraph (1) above, the total number of issued shares (excluding treasury shares)
shall be based on the total number of issued shares (excluding treasury shares) in the capital of the Company at the time
of the passing of this Resolution, after adjusting for:
(a) new shares arising from the conversion or exercise of any convertible securities;

(b) new shares arising from exercising share options or vesting of share awards which are outstanding or subsisting at the
time of the passing of this Resolution; and

(c) any subsequent bonus issue, consolidation or subdivision of shares;

(3) in exercising the authority conferred by this Resolution, the Company shall comply with the provisions of the Listing
Manual of the SGX-ST for the time being in force (unless such compliance has been waived by the SGX-ST) and the
Articles of Association of the Company; and

(4) unless revoked or varied by the Company in a general meeting, such authority shall continue in force until the conclusion
of the next Annual General Meeting of the Company or the date by which the next Annual General Meeting of the
Company is required by law to be held, whichever is earlier.

[See Explanatory Note (i)]
8.
Authority to issue shares under the BreadTalk Group Limited Employees Share Option Scheme
That pursuant to Section 161 of the Companies Act, Cap. 50, the Directors of the Company be authorised and empowered
to offer and grant options under the prevailing BreadTalk Group Limited Employees Share Option Scheme (the
Scheme) and to issue from time to time such number of shares in the capital of the Company as may be required
to be issued pursuant to the exercise of options granted by the Company under the Scheme, whether granted during the
subsistence of this authority or otherwise, provided always that the aggregate number of additional ordinary shares to be
issued pursuant to the Scheme, the BreadTalk Group Restricted Share Grant Plan and any other share based schemes
(Resolution 7)

(if applicable) shall not exceed fifteen per centum (15%) of the total number of issued shares (excluding treasury shares)
in the capital of the Company from time to time and that such authority shall, unless revoked or varied by the Company
in a general meeting, continue in force until the conclusion of the next Annual General Meeting of the Company or the
date by which the next Annual General Meeting of the Company is required by law to be held, whichever is earlier.
[See Explanatory Note (ii)]
9.
Authority to issue shares under the BreadTalk Group Limited Restricted Share Grant Plan
(Resolution 8)
That pursuant to Section 161 of the Companies Act, Cap. 50, the Directors of the Company be authorised and empowered
to offer and grant awards in accordance with the provisions of the BreadTalk Group Limited Restricted Share Grant Plan
(the Plan) and to allot and/or issue from time to time such number of fully-paid shares as may be required to be allotted
and/or issued pursuant to the vesting of the awards under the Plan, provided always that the aggregate number of new
ordinary shares to be allotted and/or issued pursuant to the Plan, the Scheme and any other share based schemes
(if applicable), which the Company may have in place, shall not exceed fifteen per centum (15%) of the total issued shares
excluding treasury shares in the capital of the Company from time to time and that such authority shall, unless revoked or
varied by the Company in a general meeting, continue in force until the conclusion of the next Annual General Meeting of
the Company or the date by which the next Annual General Meeting of the Company is required by law to be held,
whichever is earlier.
time to time (whether by way of market purchases or off-market purchases on an equal access scheme) of up to ten per
centum (10%) of the total number of issued shares (excluding treasury shares) in the capital of the Company (as
ascertained as at the date of Annual General Meeting of the Company) at the price of up to but not exceeding the
Maximum Price as defined in paragraph 3.4 of the Appendix to the Annual Report to Shareholder dated 7 April 2015, in
accordance with the terms of the Share Purchase Mandate set out in the Appendix, and this mandate shall, unless revoked
or varied by the Company in a general meeting, continue in force until the conclusion of the next Annual General Meeting
of the Company or the date by which the next Annual General Meeting of the Company is required by law to be held,
whichever is earlier.
[See Explanatory Note (v)]
(Resolution 11)
By Order of the Board
Cho Form Po
Company Secretary
Singapore
Date: 7 April 2015
[See Explanatory Note (iii)]
(Resolution 9)
10. Authority to grant awards to Participants pursuant to the Rules of, and issue shares under, the Plan
Explanatory Notes:
That, contingent upon the passing of Resolution 9, in order to reward, retain and motivate employees who had met
specific performance objectives set by the Company, the Directors of the Company be authorised and empowered to
grant awards in accordance with the provisions of the Plan to the following participants of the Plan (the Participants)
and to issue shares in the Company to the Participants of awards granted by the Company under the Plan, provided
always that the aggregate number of shares available to Controlling Shareholders and their associates under the Plan shall
not exceed twenty five per centum (25%) of all the shares available under the Plan and that the number of shares available
to each Controlling Shareholder or his associate shall not exceed ten per centum (10%) of all the shares available under
the Plan. Such authority shall, unless revoked or varied by the Company in a general meeting, continue in force until the
conclusion of the Companys next Annual General Meeting or the date by which the next Annual General Meeting of the
Company is required by law to be held, whichever is earlier.
(i)

The Ordinary Resolution 7 in item 7 above, if passed, will empower the Directors of the Company, effective until
the conclusion of the next Annual General Meeting of the Company, or the date by which the next Annual General
Meeting of the Company is required by law to be held or such authority is varied or revoked by the Company in
a general meeting, whichever is the earlier, to issue shares, make or grant Instruments convertible into shares and to
issue shares pursuant to such Instruments, up to a number not exceeding, in total, 50% of the total number of issued
shares (excluding treasury shares) in the capital of the Company, of which up to 20% may be issued other than on a
pro-rata basis to shareholders.
Name of Participant
For determining the aggregate number of shares that may be issued, the total number of issued shares (excluding
treasury shares) will be calculated based on the total number of issued shares (excluding treasury shares) in the
capital of the Company at the time this Ordinary Resolution is passed after adjusting for new shares arising from
the conversion or exercise of any convertible securities or share options or vesting of share awards which are
outstanding or subsisting at the time when this Ordinary Resolution is passed and any subsequent bonus issue,
consolidation or subdivision of shares.
(ii)

The Ordinary Resolution 8 in item 8 above, if passed, will empower the Directors of the Company, from the date of
this Meeting until the next Annual General Meeting of the Company, or the date by which the next Annual General
Meeting of the Company is required by law to be held or such authority is varied or revoked by the Company in a
general meeting, whichever is the earlier, to issue shares in the Company pursuant to the exercise of options granted
or to be granted under the Scheme up to a number not exceeding in total (for the entire duration of the Scheme)
15% of the total number of issued shares excluding treasury shares in the capital of the Company from time to time,
No. of shares to be awarded
Associate of Controlling Shareholders
Mr Frankie Quek Swee Heng
58,000
[See Explanatory Note (iv)]
(Resolution 10)

11. Renewal of Share Purchase Mandate

That for the purposes of Sections 76C and 76E of the Companies Act, Cap. 50, the Directors of the Company be and
are hereby authorised to make purchases or otherwise acquire issued shares in the capital of the Company from

and the aggregate number of ordinary shares which may be issued pursuant to the Scheme, the Plan and any other
share based schemes (if applicable) is limited to 15% of the total issued share capital of the Company excluding
treasury shares from time to time. Resolution 8 is independent from Resolution 9 and the passing of Resolution 8 is
not contingent on the passing of Resolution 9.
(iii)

The Ordinary Resolution 9 in item 9 above, if passed, will empower the Directors of the Company from the date
of the above Meeting until the next Annual General Meeting, to offer and grant awards under the Plan in accordance
with the provisions of the Plan and to issue from time to time such number of fully-paid shares as may be required
to be issued pursuant to the vesting of the awards under the Plan subject to the maximum number of shares
prescribed under the terms and conditions of the Plan. The aggregate number of ordinary shares which may be issued
pursuant to the Scheme, the Plan and any other share based schemes (if applicable) is limited to 15% of the total
issued share capital of the Company excluding treasury shares from time to time. Resolution 9 is independent from
Resolution 8 and the passing of Resolution 9 is not contingent on the passing of Resolution 8.
(iv)

The Ordinary Resolution 10 in item 10 above, if passed, will empower the Directors of the Company to issue shares
in the Company to the associate of Controlling Shareholders, granted by the Company under the Plan. Resolution 10
is contingent on the passing of Resolution 9. Shareholders who are eligible to participate in the Plan shall abstain from
voting on Resolution 10.
As at the Latest Practicable Date prior to the printing of this Notice of Annual General Meeting (i.e. 19 March 2015),
the number of shares granted in respect of the Plan since its commencement date are as follows:

Name

Aggregate Number of
Restricted Shares Granted
Aggregate Number of
Restricted Shares Vested
179,200
179,200
154,000
154,000
Frankie Quek Swee Heng
183,000
111,800
Other Participants*
3,695,630
2,988,910
TOTAL
4,211,830
3,433,910

* None of the Other Participants is either a controlling shareholder of the Company or an associate of a controlling
shareholder of the Company.

The Directors confirm that, as at the Latest Practicable Date (i.e. 19 March 2015):

(a) the aggregate number of shares issued under the Plan do not exceed 15% of the total issued shares (excluding
treasury shares) in the capital of the Company;

(b) the aggregate number of shares granted to controlling shareholders and their associates does not exceed 25% of the
shares available under the Plan; and
The rationale for Resolution 10
Mr Frankie Quek Swee Heng (Frankie Quek), CEO, Asean Region, holds an aggregate of 0.02% of the Companys
shareholding (direct and deemed interests). He is involved in the formulation and implementation of the expansion plans
of the Group in the Asean Region. With his business acumen and extensive knowledge of the local food and beverage
industry, he is assisting the Chairman, Dr George Quek Meng Tong, in overseeing the growth and expansion as well as
daily operations of the Group, focusing on the Groups expansion into the Asean Region. Frankie Quek has been based in
Shanghai since 2005 where he has been overseeing the growing bakery and food court operations in Shanghai and
Beijing. His expertise has further led to the successful expansion of the BreadTalk brand name to many Asean Cities
through a franchise model system managed by the in house franchise team. The Company therefore believes that he has
the potential and ability to contribute to the further success of the Group.
By allowing him to participate in the Plan, the Company will have an additional tool to craft a more balanced and
innovative remuneration package that will link his total remuneration to the performance of the Group. Frankie Quek will
also be able to share in any future appreciation of the Companys share price that is commensurate with the Companys
future growth through an increase in his shareholdings to a more significant level.
The Directors are of the view that the remuneration package of Frankie Quek is fair given his contributions to the Group.
The extension of the Plan to Frankie Quek is consistent with the Companys objectives to motivate its employees to
achieve and maintain a high level of performance and contribution which is vital to the success of the Company.
As the Plan serves as recognition of the past contributions of those eligible to participate in the Plan, as well as to secure
future contributions for the Company and the Group from them, the Directors consider it important that Frankie Quek
should be included in the Plan. The Directors consider it crucial for the Company to provide sufficient incentives which
will instill a sense of commitment to the Group.
The participation of and grant of Awards to Frankie Quek under the Plan has been approved in principle by shareholders
when they approved the Plan at the Extraordinary General Meeting held on 28 April 2008. Resolution 10 seeks for the
above stated reasons, shareholders approval for the Directors decision to grant 58,000 shares to Frankie Quek in
accordance with the Plan.
(v)

The Ordinary Resolution 11 proposed in item 11 above, if passed, will empower the Directors of the Company
effective until the conclusion of the next Annual General Meeting of the Company or the date by which the next Annual
General Meeting of the Company is required by law to be held, whichever is the earlier, to repurchase ordinary shares
of the Company by way of market purchases or off-market purchases of up to 10% of the total number of issued shares
(excluding treasury shares) in the capital of the Company at the Maximum Price as defined in Paragraph 3.4 to the
Appendix.The rationale for, the authority and limitation on, the sources of funds to be used for the purchase or acquisition
including the amount of financing and the financial effects of the purchase or acquisition of ordinary shares by the
Company pursuant to the Share Purchase Mandate on the audited consolidated financial accounts of the Group for the
financial year ended 31 December 2014 are set out in greater detail in the Appendix.

(c) number of shares granted to each controlling shareholder or his or her associate respectively does not exceed 10%
of the shares available under the Plan.
IMPORTANT:
BREADTALK GROUP LIMITED

Company Registration No. 200302045G
(Incorporated In Singapore)
PROXY FORM
Notes
(Please see notes overleaf before completing this Form)
1.

A Member entitled to attend and vote at the Annual General Meeting (the Meeting) is entitled to appoint proxies to
attend and vote in his/her stead. A proxy need not be a Member of the Company.
I/We,
2.

The instrument appointing a proxy must be deposited at the Registered Office of the Company at 30 Tai Seng Street,
#09-01 Breadtalk IHQ, Singapore 534013 not less than 48 hours before the time appointed for holding the Meeting.
1.

For investors who have used their CPF monies to buy BreadTalk
Group Limiteds shares, this Report is forwarded to them at
the request of the CPF Approved Nominees and is sent solely
FOR INFORMATION ONLY.
2.

This Proxy Form is not valid for use by CPF investors and shall be
ineffective for all intents and purposes if used or purported to be
used by them.
3.

CPF investors who wish to attend the Meeting as an observer must

submit their requests through their CPF Approved Nominees within
the time frame specified. If they also wish to vote, they must submit
their voting instructions to the CPF Approved Nominees within the
time frame specified to enable them to vote on their behalf.
of
being a member/members of BREADTALK GROUP LIMITED (the Company), hereby appoint:
Name
Proportion of Shareholdings
NRIC/Passport No.
No. of Shares
Personal data privacy:
Address
By submitting an instrument appointing a proxy(ies) and/or representative(s) to attend, speak and vote at the AGM and/
or any adjournment thereof, a member of the Company (i) consents to the collection, use and disclosure of the members
personal data by the Company (or its agents) for the purpose of the processing and administration by the Company (or its
agents) of proxies and representatives appointed for the AGM (including any adjournment thereof) and the preparation and
compilation of the attendance lists, minutes and other documents relating to the AGM (including any adjournment thereof),
and in order for the Company (or its agents) to comply with any applicable laws, listing rules, regulations and/or guidelines
(collectively, the Purposes), (ii) warrants that where the member discloses the personal data of the members proxy(ies)
and/or representative(s) to the Company (or its agents), the member has obtained the prior consent of such proxy(ies) and/or
representative(s) for the collection, use and disclosure by the Company (or its agents) of the personal data of such proxy(ies)
and/or representative(s) for the Purposes, and (iii) agrees that the member will indemnify the Company in respect of any
penalties, liabilities, claims, demands, losses and damages as a result of the members breach of warranty.
and/or (delete as appropriate)

Name
Proportion of Shareholdings
NRIC/Passport No.
No. of Shares
Address
or failing him/her, the Chairman of the Meeting as my/our proxy/proxies to vote for me/us on my/our behalf at the Annual General Meeting
(the Meeting) of the Company to be held on Wednesday, 22 April 2015 at 9.30 a.m. at 30 Tai Seng Street, #09-01 BreadTalk IHQ,
Singapore 534013 and at any adjournment thereof. I/We direct my/our proxy/proxies to vote for or against the Resolutions proposed at
the Meeting as indicated hereunder. If no specific direction as to voting is given or in the event of any other matter arising at the Meeting
and at any adjournment thereof, the proxy/proxies will vote or abstain from voting at his/her discretion. The authority herein includes the
right to demand or to join in demanding a poll and to vote on a poll.
(Please indicate your vote For or Against with a tick [] within the box provided.)
No.
Resolutions relating to:
Directors Report and Audited Financial Statements for the year ended 31 December 2014.
For
Payment of proposed final dividend.
Re-election of Ms Katherine Lee Lih Leng as a Director.
4
5
Re-election of Mr Ong Kian Min as a Director.

Approval of Directors fees amounting to S$172,950/- for the year ended 31 December 2014.
Re-appointment of Messrs Ernst & Young LLP as Auditors.
Authority to issue new shares.
Authority to issue shares under the BreadTalk Group Limited Employees Share Option Scheme.
9

10
11
Authority to issue shares under the BreadTalk Group Limited Restricted Share Grant Plan
(the Plan).
Share award under the Plan to Mr Frankie Quek Swee Heng.
Renewal of Share Purchase Mandate.
Against
Dated this_____________________day of_____________________2015

Total number of Shares in:

Signature of Shareholder(s)
or, Common Seal of Corporate Shareholder

No. of Shares
(a) CDP Register

(b) Register of Members
PERSONAL DATA PRIVACY:

By submitting an instrument appointing a proxy(ies) and/or representative(s), the member accepts and agrees to the personal data privacy
terms set out in the Notice of Annual General Meeting dated 7 April 2015.
Notes:
1.

Please insert the total number of Shares held by you. If you have Shares entered against your name in the Depository Register (as
defined in Section 130A of the Companies Act, Chapter 50 of Singapore), you should insert that number of Shares. If you have Shares
registered in your name in the Register of Members, you should insert that number of Shares. If you have Shares entered against your
name in the Depository Register and Shares registered in your name in the Register of Members, you should insert the aggregate
number of Shares entered against your name in the Depository Register and registered in your name in the Register of Members. If
no number is inserted, the instrument appointing a proxy or proxies shall be deemed to relate to all the Shares held by you.
2.

A member of the Company entitled to attend and vote at a meeting of the Company is entitled to appoint proxies to attend and vote
in his/her stead. A proxy need not be a member of the Company.
3.

Where a member appoints more than one proxy, the appointments shall be invalid unless he/she specifies the proportion of his/her
shareholding to be represented by each proxy. If no proportion or number of shares is specified, the first named proxy may be treated
as representing 100% of the shareholding and any second named proxy as an alternate to the first named.
4.

The instrument appointing a proxy or proxies must be deposited at the Registered Office of the Company at 30 Tai Seng Street, #09-01
BreadTalk IHQ, Singapore 534013 not less than 48 hours before the time appointed for the holding of the Meeting.
5.

The instrument appointing a proxy or proxies must be executed under the hand of the appointor or of his attorney duly authorised in
writing. Where the instrument appointing a proxy or proxies is executed by a corporation, it must be executed either under its seal
or under the hand of an officer or attorney duly authorised or in such manner as appropriate under applicable laws. Where the original
instrument appointing a proxy or proxies is executed by an attorney on behalf of the appointor, the original power of attorney or other
authority, if any, under which the instrument of proxy is signed or a duly certified copy of that power of attorney or other authority
(failing previous registration with the Company) shall be attached to the original instrument of proxy and must be left at the Registered
Office, not less than 48 hours before the time appointed for the holding of the Meeting or the adjourned Meeting at which it is to be
used failing which the instrument may be treated as invalid.
6.

A corporation which is a member may authorise by resolution of its directors or other governing body such person as it thinks fit to
act as its representative at the Meeting, in accordance with Section 179 of the Companies Act, Chapter 50 of Singapore. The Company
shall be entitled to treat an original certificate under the seal of the corporation as conclusive evidence of the appointment or
revocation of appointment of a representative.
General:
The Company shall be entitled to reject the instrument appointing a proxy or proxies if it is incomplete, improperly completed or illegible
or where the true intentions of the appointor are not ascertainable from the instructions of the appointor specified in the instrument
appointing a proxy or proxies. In addition, in the case of Shares entered in the Depository Register, the Company shall reject any instrument
appointing a proxy or proxies lodged if the member, being the appointor, is not shown to have Shares entered against his name in the
Depository Register as at 48 hours before the time appointed for holding of the Meeting, as certified by The Central Depository (Pte)
Limited to the Company.

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D I R E C TO R S R E P O R T

Arrangements to enable directors to acquire shares and debentures

Directors interests in shares and debentures

44 BreadTalk Group Limited ANNUAL REPORT 2014

Dr George Quek Meng Tong

BreadTalk Group Limited ANNUAL REPORT 2014

Directors interests in shares and debentures (contd)

Share Option and Share Plans (contd)

The BreadTalk Group Limited Employees Share Option Scheme

(i) Employees and Directors

(b) The BreadTalk Restricted Share Grant Plan

(ii) Controlling Shareholders and their Associates

46 BreadTalk Group Limited ANNUAL REPORT 2014

BreadTalk Group Limited ANNUAL REPORT 2014

Share Option and Share Plans (contd)

Share Option and Share Plans (contd)

(b) The BreadTalk Restricted Share Grant Plan (contd)

(b) The BreadTalk Restricted Share Grant Plan (contd)

Grant of RSG Plan

Share Awards and Vesting

Size of RSG Plan

48 BreadTalk Group Limited ANNUAL REPORT 2014

BreadTalk Group Limited ANNUAL REPORT 2014

Share Option and Share Plans (contd)

Dr George Quek Meng Tong

Oh Eng Lock (3)

(1) Also a controlling shareholder of the Company

On behalf of the board of directors:

Katherine Lee Lih Leng

50 BreadTalk Group Limited ANNUAL REPORT 2014

BreadTalk Group Limited ANNUAL REPORT 2014

On behalf of the board of directors:

Independent auditors report to the members of BreadTalk Group Limited

Dr George Quek Meng Tong

Katherine Lee Lih Leng

52 BreadTalk Group Limited ANNUAL REPORT 2014

BreadTalk Group Limited ANNUAL REPORT 2014

Independent auditors report to the members of BreadTalk Group Limited

Ernst & Young LLP

54 BreadTalk Group Limited ANNUAL REPORT 2014

BreadTalk Group Limited ANNUAL REPORT 2014

Trade and other payables

Loan from a minority shareholder of

56 BreadTalk Group Limited ANNUAL REPORT 2014

BreadTalk Group Limited ANNUAL REPORT 2014

58 BreadTalk Group Limited ANNUAL REPORT 2014

Attributable to owners of the Company

Purchase of treasury shares

Attributable to owners of the Company

Total comprehensive income

Total comprehensive income

Total transactions with

Purchase of treasury shares

BreadTalk Group Limited ANNUAL REPORT 2014

Write back of provision for reinstatement cost

Impairment loss on property, plant and equipment

Dividend income from unquoted investment equity

Unrealised exchange loss / (gain), net

Cash paid for reinstatement expenses