Raffles Education says no merit to tycoon Oei Hong Leong's EGM request; posts $16.4m full-year loss

Mr Oei Hong Leong (left) is seeking once again to remove Raffles Education Corp founder Chew Hua Seng as chairman and chief executive officer.
Mr Oei Hong Leong (left) is seeking once again to remove Raffles Education Corp founder Chew Hua Seng as chairman and chief executive officer.PHOTOS: SHIN MIN DAILY NEWS

SINGAPORE - Raffles Education Corp's board of directors will not be convening an extraordinary general meeting (EGM) for shareholders to vote on Mr Oei Hong Leong's proposed resolutions.

Among other things, the billionaire had again sought to remove Raffles Education founder Chew Hua Seng as chairman and chief executive officer, in an EGM requisition notice sent by him and his firm, Oei Hong Leong Art Museum, last week.

In a bourse filing late Wednesday night (Aug 26), Raffles Education said it obtained legal advice on the contents of the notice, and was advised that the request is without merit.

In particular, the board was advised that based on the provisions of the Companies Act and Raffles Education's Memorandum and Articles of Association, each of the proposed resolutions as currently framed in the notice concerned subject matters falling outside the province of the shareholders at the general meeting.

Also, the notice was issued after the decisions of the Court of Appeal and the High Court of Singapore to dismiss Mr Oei and his firm's lawsuit against Mr Chew on an alleged handwritten agreement that was referred to in the EGM requisition notice, under the sixth resolution.

"In the circumstances", the board is not required to convene an EGM for the purposes of voting on the proposed resolutions, Raffles Education said.

Separately, the private education provider fell into the red with a net loss of $16.4 million for the 12 months ended June 30, versus a net profit of $40.2 million in the previous fiscal year.

The "challenging" global education environment, currency volatility, increasing competition and the coronavirus outbreak continued to weigh on the group's performance.

In particular, its recruitment and retention of foreign students since January this year have taken a hit from the border restrictions and lockdowns implemented in response to the pandemic. This uncertainty will continue to have an impact on the group, Raffles Education said on Thursday.

 
 
 

Loss per share stood at 1.19 cents for the 2020 financial year, compared with earnings per share of 2.92 cents a year ago.

Revenue inched up by 3 per cent to $100.5 million, from $97.9 million, largely thanks to higher revenue from South-east Asia. It was offset by lower revenue from Australia due to the sale of an investment property in New South Wales last November.

No dividend was declared for the year, "due to the Covid-19 pandemic and on a prudence basis", Raffles Education said. There was also no dividend declared for financial year 2019.

Mainboard-listed Raffles Education's shares gained 0.2 cent or 1.9 per cent to finish at 11 cents on Wednesday.