TIDMSYME
RNS Number : 5147N
Supply @ME Capital PLC
30 September 2021
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS STIPULATED
UNDER THE UK VERSION OF THE MARKET ABUSE REGULATION NO 596/2014
WHICH IS PART OF ENGLISH LAW BY VIRTUE OF THE EUROPEAN UNION
(WITHDRAWAL) ACT 2018, AS AMED. ON PUBLICATION OF THIS ANNOUNCEMENT
VIA A REGULATORY INFORMATION SERVICE, THIS INFORMATION IS
CONSIDERED TO BE IN THE PUBLIC DOMAIN.
30 September 2021
Supply@ME Capital plc
(The "Company" or "SYME")
Interim results for the six months ended 30 June 2021
Supply@ME Capital plc, the fintech business which provides an
innovative Platform for use by manufacturing and trading companies
to access Inventory Monetisation(c) solutions enabling their
businesses to generate cashflow, announces its results for the
half-year ended 30 June 2021.
Highlights
-- Post-tax loss of GBP1.9mn (2020: GBP2.8mn) as a result of
continued investment in technology, operations and hiring new
senior team members.
-- Revenue of GBP271,000 generated from "Captive" inventory
monetisation stream, primarily from due diligence fees charged by
Italian subsidiary. The same revenue trend observed in the prior
year is expected (first half dedicated to preliminary analysis with
related outcomes underpinning revenues in the second part of the
year). The revenue guidance in the RNS of 31 August 2021 is
confirmed.
-- Captive business origination pipeline valued at GBP1.5bn,
across 126 prospective clients (being the potential value of
inventory to be monetised over the Platform).
-- Total Investment Advisory origination pipeline valued at GBP750mn.
Interim results do not incorporate acquisition of TradeFlow
Capital Management, which completed on 01 July 2021.
Financial Summary
H1 2021 H1 2020
Unaudited Unaudited and restated
Revenue GBP271,000 -
--------------- ------------------------
Gross loss (GBP131,000) (GBP238,000)
--------------- ------------------------
Loss after tax (GBP1,889,000) (GBP2,777,000)
--------------- ------------------------
Loss per share (pence) (0.01) (0.01)
--------------- ------------------------
Alessandro Zamboni, CEO, Supply@ME Capital Plc , said:
"The first half of 2021 was challenging for the entire world,
not least for Supply@ME. However, despite being in its infancy, the
business has remained steady throughout a global pandemic. We
significantly expanded our team - which now includes some of the
foremost talent in banking and inventory funding - and we have
built an unparalleled inventory monetisation platform that is a
genuine alternative to traditional finance.
"While our efforts have not necessarily been borne out in this
set of numbers, we have built a strong pipeline of new business,
some of which we expect to come into play by year-end. We are
poised to seize the multitude of opportunities available to us,
including the first monetisation transactions on our platform, and
more. I am very proud of the team for what they have achieved in
the first half of this year and look forward to the exciting times
ahead."
Notes
Supply@ME Capital PLC and its operating subsidiaries (together
the "Group") provide an innovative fintech platform (the
"Platform") for use by manufacturing and trading companies to
access inventory trade solutions enabling their businesses to
generate cashflow, via a non-credit approach and without incurring
debt. This is achieved by their existing eligible inventory being
added to the Platform and then monetised via purchase by third
party Inventory Funders. The inventory to be monetised can include
warehouse goods waiting to be sold to end-customers or
goods/commodities that are part of a typical import/export
transaction. SYME announced in August 2021 the launch of the Global
Inventory Monetisation Fund ("Fund") which will be focused on both
inventory in transit monetisation and warehouse goods monetisation.
This Fund will be focused on creditworthy companies and not those
in distress or otherwise seeking to monetise illiquid
inventories.
Contacts
Alessandro Zamboni, CEO, Supply@ME Capital plc,
investors@supplymecapital.com
Paul Vann, Walbrook PR Limited, +44 (0)20 7933 8780;
paul.vann@walbrookpr.com
Brian Norris, Cicero/AMO, +44 (0)20 7947 5317
brian.norris@cicero-group.com
SUPPLY@ME CAPITAL PLC
UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE 6 MONTH PERIODED 30 JUNE 2021
Chief Executive Report
Business model summary
Supply@ME Capital PLC (the "Company" or "SYME") and its
operating subsidiaries (together the "Group") provide an innovative
fintech platform (the "Platform") for use by manufacturing and
trading companies to access inventory trade solutions, enabling
their businesses to generate cashflow via a non-credit approach,
without incurring debt. This is achieved by client companies
existing eligible inventory being added to the Platform and then
monetised via purchase by third-party Inventory Funders ("IM
Transactions"). The inventory to be monetised can include
warehoused goods waiting to be sold to end-customers or
goods/commodities that are part of a typical import/export
transaction. On 09 August 2021, SYME announced the launch of the
Global Inventory Monetisation Fund ("Fund") which will be focused
on both inventory in transit monetisation and warehoused goods
monetisation. This Fund will be available to creditworthy companies
and not those in distress or otherwise seeking to monetise illiquid
inventories.
As outlined in the company's RNS announcement of 31 August 2021,
following the acquisition of TradeFlow Capital Management Pte. Ltd
("TradeFlow") and the launch of the Fund, the Group is now focused
on establishing and growing the following active, and future,
revenue streams:
-- Investment Advisory ("IA"): this is the revenue stream
currently being generated by TradeFlow in its capacity as
investment advisor to its well-established funds, as well as its
anticipated role as investment advisor to the Fund going
forward.
This stream is expected to generate recurring revenues of
approximately 1.25% of Assets Under Management for which TradeFlow
acts as advisor. Additionally, TradeFlow could receive a further
performance incentive fee of up to 15% of the profits generated by
the Fund, based on performance.
-- "Captive" inventory monetisation platform servicing ("C.IM"):
this is revenue generated through the use of the Platform to
facilitate inventory monetisation ("IM") transactions performed by
the Fund and its Inventory Funders. This revenue is generated by
the Group's Supply@ME operating subsidiaries, and in the future is
expected to be supplemented by Tijara Pte Ltd, a technology
subsidiary company of TradeFlow. Revenue will be earned in relation
to the following activities:
o origination and due diligence (pre-IM); and
o monitoring, controlling and reporting (post-IM).
This stream is expected to generate revenues of approximately
1-3% of the gross value of the inventories monetised (purchase
price plus VAT).
-- "White Label" inventory monetisation platform servicing
("WL.IM"): this is the revenue to be generated through the use of
the Platform by third parties who choose to employ the self-funding
model.
This stream is expected to generate recurring
software-as-a-service revenues of approximately 0.5-1.5% of the
value of each Inventory Monetisation transaction (the amount of
funding provided).
Inventory funding programme, boosting the IA and C.IM revenue
streams
The Group's Platform can be used in conjunction with several
funding routes to facilitate IM Transactions for client companies
with eligible inventories.
Following the recent launch of the Fund, the promotion of the
inventory funding activities is managed directly by the Fund and
TradeFlow, with the support of regulated introducers and
distributors. As a result of these activities, the Company
announced via RNS on 09 August 2021 that TradeFlow' funds received
an Investment Grade final rating from a leading ratings agency for
its 4-year Senior Note. Leveraging the global investor network of
the Group, the funds have secured investors subscribing for the
full, initial $40m issuance.
In order to support the IM transactions and mitigate the
potential funding concentration risk, the Fund is liaising with
over 12 Institutional Investors and family offices which have
demonstrated interest in being the Inventory Funder for the initial
IM Transactions. These initial transactions will involve inventory
warehoused in Italy, as well as in the UK and UK common law
geographies.
With reference to the Fintech Bank initiative (referenced in the
RNS of 29 June 2021), on 10 August 2021 decree no.114 of the
Italian Ministry of Economy and Finance of 25 May 2021, was issued.
This decree contained Regulations requiring the registration of
non-possessing personal pledges to be kept exclusively
electronically. This regulation, following international market
practices, aims to align the transparency of collateralised
inventories to improve inventory funding transactions, and also
strengthen the legal enforceability of the latter collaterals.
This key regulatory change impacted the current structuring
activities of the Italian IM Transactions, and there is now the
opportunity to furhter improve the security package. As a result,
SYME and the Fintech bank are discussing, together with a leading
Italian company which specialises in trade insurance and financial
guarantees, how to create an inventory funding format that is both
scalable and replicable. As a result, it is highly likely that an
extension to the expiry date within the current term sheet will be
agreed by both Parties. At the same time the Captive Bank project
is progressing and the Company will update the market in due course
with further developments.
The Shariah compliant version of the Platform is progressing
well with its funding specialist and a dedicated announcement
regarding this initiative is expected shortly.
Self-funding programme, boosting the White Label (WL.IM) revenue
streams
During H1 2021, the Group invested in developing the integrated
capabilities to enable it to offer its White Label inventory
monetisation platform service. SYME's operating subsidiaries, both
in the UK and in Italy, are in discussions with potential IM
funders and origination partners. An increase in WL.IM requests
from local Italian Banks or banking service providers is also
expected as a result of the Italian decree referred to in the
section above.
Client Company origination continues to remain strong
In line with the Company's trading update published on 31 August
2021, the Company continues to see clear and growing demand for the
Group's Platform to facilitate the inventory monetisation service.
As a result of the Fund, the Company has now been able to extend
its client base to cover both warehoused goods and those subject to
import/ export trade transactions.
As stated in the recent trading update, the total IA pipeline
was GBP750m while the C.IM pipeline was approximately GBP1.5bn
across 126 clients, the majority of which are based in Europe. The
Company recently appointed a new Head of Origination, Ms Nicola
Bonini, whose focus is to help identify and grow the number of UK
client companies interested in using the Group's Platform to
facilitate IM transactions.
The recent trading update defined the C-.IM "pipeline" as client
companies for which due diligence is completed or underway and/ or
eligible prospects which show an interest in the inventory
monetisation services and with which the Group is working in the
pre-analysis phase. The monetary value above represents the
potential value of inventory to be monetised by these client
companies rather than the pipeline revenue expected to be earned by
the Group. However, this does provide a good indicator of the level
of demand for the Group's current and future services.
These pipeline numbers does not include any client companies
that have been lost due to either failing to meet eligibility
criteria or delays in obtaining securitisation funding. Some of
these lost client companies can be expected to be re-onboarded once
the first inventory monetisation has been completed.
The geographical and sectoral analysis remains in line with the
update published on the 31 August 2021.
Other operational considerations
New geographies: US and Asia-Pacific (APAC)
US: The Group sees a large market for inventory-based
transactions in the US and, as such, has engaged one of its
accounting advisors to assess the US GAAP compliance of the
existing IM Transaction structure. In parallel, The Trade Advisory
and Mr. Anthony Brown remain in discussion with potential Inventory
Funders and client companies interested in the inventory
monetisation service in the US.
APAC: Leveraging the support of ARC Group (as per the RNS of 02
September 2021), the Company has commenced discussions for a pilot
a IM Transaction in the region.
Digital workplaces and Platform management
As a result of the acquisition of TradeFlow, the Group now has
staff based in London, Milan and Singapore. The Group's operational
teams have been working closely together since the acquisition to
identify synergies between the two business models. In particular
the ICT and digital platform teams are working closely together on
a daily basis to drive improvements to the Platform by:
-- leveraging the existing software modules (including CRM and
trading) and technologies (including cloud environments and
artificial intelligence) to build an integrated digital
environment;
-- developing a version of the Platform able to be delivered "as
a service", in preparation for potential requests linked to
white-label agreements with Banks; and
-- exploring further partnerships/ strategic acquisitions with
technology vendors (in particular, in the space of the Internet of
Things and inventory management optimisation).
In addition, the Company has recently appointed Mr Mark Kavanagh
as Group General Head of Operations and Transformation who will
lead on Platform developments.
Public relations activities
Since June 2020, in addition to Walbrook Financial PR the
Company engaged Cicero/AMO as full-service communications and
market research partner.
Cicero/AMO supports with formal financial markets reporting and
the wider marketing and brand development activities of the Group.
In this regard, the Company is preparing a marketing and awareness
campaign in the UK to further promote the use of the Platform to
facilitate IM Transactions to potential client companies, including
a digital on-boarding experience for the service via an application
to the Global Inventory Monetisation Fund.
New Chairman appointment
In July the Company engaged Nurole Ltd in respect of the
recruitment of a new Chair. The process is in its final stages and
the Board expects to update the market by the end of October.
Future prospects
Recent developments in the inventory trade solutions space,
including new entrants; discussions around the trade finance
eco-system; and the sector's digitalisation priorities, will
support the growth of interest in the Group's unique service
offering. The Group's progress will reinforce inventory as a viable
asset class and the Board is confident it will attract funding form
multiple investment structures.
In addition, we are expecting further growth within inventory
management industry. Supply chain disruption wrought by the
Covid-19 pandemic, which has intensified during this interim
reporting period, has increasingly seen CFOs and other responsible
members of senior management proactively to reshape their supply
chain policies. For the first time in two decades companies are
moving away from the "just in time" to the "just in case" model of
stocking goods. Technology to cater to these needs, such as
optimisation software and RFID technologies, are in growing
demand.
The above landscape provides the Group with many opportunities
and supports the assumptions underpinning the revenue guidance
published by the Company in the last trading update RNS on 31
August 2021.
Finally, the Group expects to continue its positive progress in
the coming months on key initiatives underway, a number of which
have not been included in the Trading Update announced on 31
August, including the Shariah funding stream.
Financial performance
The Group's main focus during the six-month period to 30 June
2021 has been on the activities described throughout this report.
Now, the Group is in a strong position to move forward with each of
the revenue streams outlined. Reaching this point has required
significant investment in the Group's resources and infrastructure.
Therefore the Group recorded both a gross loss of GBP131,000 and an
overall loss after tax of GBP1,889,000 for the current period, down
from a gross loss of GBP238,000 and an overall loss after tax of
GBP2,777,000 during the comparative period in 2020.
As the completion of the TradeFlow acquisition took place on 01
July 2021, the results presented in these unaudited condensed
consolidated interim financial statements for the six-month period
ended 30 June 2021 do not include the results of TradeFlow.
TradeFlow's results will be consolidated by the Group from the date
of acquisition.
The Group's revenue for the six-month period ended 30 June 2021
of GBP271,000 was generated from the C.IM revenue stream, as
described, and relates to due diligence fees charged to client
companies by the Group's Italian operating subsidiary. In line with
IFRS 15 the Group recognised these revenues when the due diligence
services have been delivered and the Group's performance obligation
has been satisfied. Of this revenue recognised in H1 2021,
GBP182,000 (67%) relate to balances that had been recognised as
deferred income as at 31 December 2020.
Management expects the same revenue trend to occur in 2021 as
was observed in the prior year. This trend saw the first half of
the year dedicated to managing the preliminary analysis of client
companies and the outcome of this analysis is expected to generate
C.IM revenues in the second part of the year, in line with our
Trading Update issued on 31 August 2021.
The revenue for the comparative six-month period ended 30 June
2020 has been restated in line with IAS 8 (Accounting Policies,
Changes in Accounting Estimates and Errors) to ensure the Group's
revenue recognition accounting policies have been applied
consistently and correctly over the two six-month periods
presented, and are in line with those applied in the 2020 Audited
Annual Financial Statements. As a result, the revenue for the
comparative six-month period ended 30 June 2020 has been restated
from GBP368,000 to nil.
During the preparation of the interim financial statements for
the six-month period ended 30 June 2020, revenue had been
recognised when the due diligence services had been delivered by
the Group. However, on closer analysis of the Group's older
contracts (those which had been agreed pre-June 2020), it was
determined that these agreements identified the performance
obligation as the use of the Group's Platform for the first time by
the client company in order to facilitate an inventory monetisation
transaction. In addition, the amounts paid by client companies
before 30 June 2020 were refundable under certain circumstances and
up to the point when the Platform was able to be used for the first
time by the client companies. As this performance obligation has
not yet been satisfied by the Group, the amounts received did not
meet the revenue recognition criteria in IFRS 15 and as such these
amounts were removed from revenue and instead recognised as
deferred income on the balance sheet as at 30 June 2020. There was
also a corresponding opening balance sheet adjustment as at 01
January 2020 that needed to be made.
Further details on the prior period restatements can be found in
Note 20 to the unaudited interim financial statements.
As announced on 16 June 2021, the Company entered into a
subscription agreement with Negma Group Limited for an initial
tranche of Convertible Loan Notes with a par value of GBP5,600,000
and for which the Group received GBP5,000,000 in cash. The interest
expense recognised in relation to these Convertible Loan Notes in
the six-month period ended 30 June 2021 was GBP190,000. As at 30
June 2021, the full amount of these Convertible Loan Notes remains
outstanding. Further details are set out in Note 4 to the interim
financial statements.
As at 30 June 2021, the Group had recognised deferred income on
its balance sheet of GBP397,000 (31 December 2020: GBP1,131,000).
GBP182,000 of revenue recognised in the six-month period ended 30
June 2021 had previously been recognised as deferred income as at
31 December 2020.
The remaining decrease in the deferred income as at 30 June 2021
relates to a reclassification of such amounts to "other payables"
on the balance sheet. This is due to a change in management
assessment, based on the current information available, that
completion of the underlying performance obligation by the Group is
no longer probable. In particular, some of these amounts have been
requested to be refunded by the client companies during the
six-month period ended 30 June 2021. The majority of these refunds
were due for repayment as at 30 June 2021 and therefore have been
reclassified to "other payables". Management are confident that
some of these client companies will return following the first
inventory monetisation transactions being executed on the
Platform.
During the six-month period ended 30 June 2021, the Group
continued to invest in product development to enhance the operation
of the Platform and to ensure compliance with legal, regulatory and
accounting requirements. These costs have continued to be
capitalised as intangible assets, with additions in the six-month
period ended 30 June 2021 of GBP529,000. This compares to
GBP459,000 in the six-month period ended 30 June 2020.
Directors' Responsibility Statement
The Directors are responsible for preparing the interim
financial statements in accordance with applicable law and
regulations. A list of current directors is maintained on the
Group's website: https://www.supplymecapital.com.
The Directors confirm that, to the best of their knowledge, the
interim financial statements have been prepared in accordance with
IAS 34 as adopted by the European Union, and give a true and fair
view of the assets, liabilities, financial position and profit or
loss of the Company, or the undertakings included in the
consolidation as a whole as required by DTR 4.2.4 R.
The Directors further confirm that the interim financial
statements include a fair review of the information required by DTR
4.2.7R and DTR 4.2.8R.
In accordance with the FSA's Disclosure and Transparency Rule
4.2.9(2), the Directors confirm that these interim condensed
consolidated financial statements have not been audited or reviewed
by auditors pursuant to the Auditing Practices Board guidance on
Review of Interim Financial Information.
The Directors have shared all the relevant working papers with
their advisers.
By Order of the Board
Alessandro Zamboni
Chief Executive Officer
SUPPLY@ME CAPITAL PLC
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE
INCOME
FOR THE 6 MONTH PERIODED 30 JUNE 2021
6 months 6 months
to to
30 June 2021 30 June 2020
as restated
Unaudited Unaudited
Notes GBP '000 GBP '000
Revenue 5 271 -
Cost of sales (402) (238)
Gross loss (131) (238)
Administrative expenses (1,370) (1,229)
Exceptional costs 6 - (1,369)
Operating loss (1,501) (2,836)
Finance costs (192) -
Loss before tax (1,693) (2,836)
Taxation 7 (196) 59
Loss for the period (1,889) (2,777)
=============== ===============
Other comprehensive income
Foreign operations FX translation (21) (18)
Total comprehensive profit / (loss)
for the period (1,910) (2,795)
=============== ===============
Loss per share (pence) 9 (0.01) (0.01)
The above condensed consolidated statement of comprehensive
income should be read in conjunction with the accompanying
notes.
SUPPLY@ME CAPITAL PLC
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2021
30 June 2021 31 December
Unaudited 2020
Audited
Notes GBP '000 GBP '000
Non-current assets
Intangible assets 10 1,532 1,236
Tangible assets 5 2
Deferred tax asset 209 422
Total non-current assets 1,746 1,660
Current assets
Trade and other receivables 11 629 1,113
Cash and cash equivalents 4,201 552
----------------- --------------
Total current assets 4,830 1,665
----------------- --------------
Total assets 6,576 3,325
Current liabilities
Trade and other payables 12 3,303 3,395
Derivative financial instruments 24 24
Convertible loan notes 13 5,190 -
----------------- --------------
Total current liabilities 8,517 3,419
----------------- --------------
Net current assets/(liabilities) (3,687) (1,754)
Non-current liabilities
Provisions 14 344 358
Total non-current liabilities 344 358
Net liabilities (2,285) (452)
================= ==============
Equity attributable to owners of the
parent
Share capital 15 5,420 5,420
Share premium 11,820 11,820
Other reserves (13,992) (13,986)
Retained losses (5,533) (3,706)
----------------- --------------
Total equity (2,285) (452)
================= ==============
The above condensed consolidated statement of financial position
should be read in conjunction with the accompanying notes.
SUPPLY@ME CAPITAL PLC
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN
EQUITY
FOR THE 6 MONTH PERIODED 30 JUNE 2020
Merger Reverse Foreign
Share Share Other relief takeover currency Retained
capital premium reserves reserve reserve reserves earnings Total
as as as as as as as as
restated restated restated restated restated restated restated restated
GBP '000 GBP '000 GBP '000 GBP '000 GBP '000 GBP '000 GBP '000 GBP '000
B/f as at 1
January 2020 148 - - - - 3 (708) (557)
FX translation - - - - - - (43) (43)
B/f as at 1
January 2020
post FX
translation 148 - - - - 3 (751) (600)
Loss for the 6
months - - - - - - (2,777) (2,777)
FX translation
differences - - - - - (18) - (18)
----------- ----------- ----------- ----------- ----------- ---------- ----------- -----------
Total
comprehensive
profit for
the year - - - - - (18) (2,777) (2,795)
Transfer to
reverse
takeover
reserve (148) - - - 148 - - -
Recognition of
Plc equity at
acquisition 4,767 9,597 - - (13,505) - - 859
Reverse
takeover of
Supply@ME
S.r.l. 646 - - 223,832 (224,478) - - -
Issue of
shares for
cash 7 2,234 - - - - - 2,241
Cost of share
issues - (11) - - - - - (11)
Legal reserve
movement - - 12 - - - - 12
C/f as at 30
June 2020 5,420 11,820 12 223,832 (237,835) (15) (3,528) (294)
=========== =========== =========== =========== =========== ========== =========== ===========
The above condensed consolidated statement of changes in equity
should be read in conjunction with the accompany notes.
SUPPLY@ME CAPITAL PLC
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE
INCOME
FOR THE 6 MONTH PERIODED 30 JUNE 2021
Merger Reverse Foreign
Share Share Other relief takeover currency Retained
capital premium reserves reserve reserve reserves earnings Total
GBP '000 GBP '000 GBP '000 GBP '000 GBP '000 GBP '000 GBP '000 GBP '000
B/f as at 1
January 2021 5,420 11,820 4 223,832 (237,835) 13 (3,706) (452)
FX translation - - - - - - 62 62
B/f as at 1
January 2021
post FX
translation 5,420 11,820 4 223,832 (237,835) 13 (3,644) (390)
Loss for the 6
months - - - - - - (1,889) (1,889)
FX translation
differences - - - - - (21) - (21)
----------- ------------ ----------- ----------- ----------- ----------- ----------- ---------
Total
comprehensive
profit for
the year - - - - - (21) (1,889) (1,910)
Legal reserve
movement - - 15 - - - - 15
C/f as at 30
June 2021 5,420 11,820 19 223,832 (237,835) (8) (5,533) (2,285)
=========== ============ =========== =========== =========== =========== =========== =========
The above condensed consolidated statement of changes in equity
should be read in conjunction with the accompany notes.
SUPPLY@ME CAPITAL PLC
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE 6 MONTH PERIODED 30 JUNE 2021
6 months 6 months
to to
30 June 2021 30 June 2020
Unaudited Unaudited
as restated
GBP '000 GBP '000
Cash flows from operating activities
Loss before income tax (1,693) (2,836)
FX translation of foreign entities (1) (3)
Amortisation and depreciation 179 99
Deemed cost of listing - 1,369
Increase in provisions 3 87
Decrease / (increase) in trade receivables 526 -
Increase / (decrease) in trade payables 116 357
Other decreases / (increases) in net
working capital (139) (318)
-------------- --------------
Cash flows from operations (1,009) (1,245)
Convertible loan notes interest expense 190 -
Income taxes paid - -
-------------- --------------
Net cash flows from operating activities (819) (1,245)
Cash flows from investing activities
Cash from Abal plc - 91
Purchase of tangible assets (3) (2)
Purchase of intangible assets (529) (459)
-------------- --------------
Cash flows from investing activities (532) (370)
Cash flows from financing activities
Convertible loan notes 5,000 -
Proceeds from other loan facilities - 125
Net proceeds from issue of shares - 2,230
Cash flows from financing activities 5,000 2,355
Net movement in cash and cash equivalents 3,649 740
Cash and cash equivalents as at 1 January 552 152
Cash and cash equivalents as at 30
June 4,201 892
============== ==============
The above unaudited condensed consolidated statement of cash
flows should be read in conjunction with the accompanying
notes.
SUPPLY@ME CAPITAL PLC
NOTES TO THE UNAUDITED INTERIM FINANCIAL STATEMENTS
FOR THE 6 MONTH PERIODED 30 JUNE 2021
1. Company information
Supply@ME Capital plc is a public limited liability company
incorporated in England and Wales. The address of its registered
office 27/28 Eastcastle Street, London, W1W 8DH, United Kingdom.
Supply@ME Capital's shares are listed on the London Stock
Exchange.
The unaudited Interim Financial Statements have been approved
for issue by the Board of Directors on 29 September 2021.
2. Basis of preparation
Accounting convention
This unaudited interim financial report for the half-year
reporting period ended 30 June 2021 has been prepared in accordance
with Accounting Standard IAS 34 Interim Financial Reporting.
The interim report does not include all the notes of the type
normally included in an annual financial report. Accordingly, this
report is to be read in conjunction with the annual report for the
year ended 31 December 2020 and any public announcements made by
Supply@ME Capital Plc during the interim reporting period.
The accounting policies adopted are consistent with those of the
previous financial year and corresponding interim reporting period,
with the exception of the restatements that have been made to the
corresponding interim reporting period (refer to Notes 20 for
further details) and the estimation of income tax (refer to note 7
for further details).
New and amended standards adopted by the group
A number of new or amended standards became applicable for the
current reporting period. The group did not have to change its
accounting policies or make retrospective adjustments as a result
of adopting any new or amended standards in the current interim
reporting period.
3. Going Concern
At the 30 June 2021 the Group had cash balances of GBP4,201,000
(31 December 2020: GBP552,000) and net current liabilities of
GBP3,687,000 (31 December 2020: net current liabilities
GBP1,754,000). The Group has posted a loss for the six-month period
after tax of GBP1,889,000 (2019: loss GBP2,777,000) and retained
losses were GBP5,533,000 (31 December 2020: losses
GBP3,706,000).
The current liabilities as at 30 June 2021 of GBP8,517,000
included GBP5,190,000 relating to the outstanding balance of
Convertible Loan Notes which the Group issued on 16 June 2021. As
outlined in the Note 16 ("events occurring after the reporting
period") GBP3,584,000 of this balance has converted into new
ordinary shares in the Company at the request of the Convertible
Loan Note holder following the period end date, but prior to the
issue of these interim accounts. The remaining GBP2,016,000 is
expected to be repaid in cash following the issue of these interim
financial statements as a result of the new funding facility
announced by the Company on 29 September 2021. In addition to the
above, GBP397,000 included within current liabilities is in
relation to deferred income held on the balance sheet as at 30 June
2021 and a further GBP411,000 relates to refundable client deposits
which are expected to be returned to the customers following 30
June 2021.
On 1 July 2021 the Company completed the acquisition of the
entire share capital of TradeFlow Capital Management Pte. Limited
("TradeFlow") by way of cash and share consideration. As such from
this date TradeFlow became a fully owned subsidiary of the Company
and will form part of the Group's consolidated financial
performance and position going forward. TradeFlow is an established
business which is expected to contribute positive revenue streams
to the Group going forward.
Taking into account the factors above and in order to consider
their assessment of the Group as a going concern, the Directors
have reviewed the forecast cashflows for the next 12 months. The
cashflow forecasts take into account that the Group meets its day
to day working capital requirement through its cash resources and
are based on the enlarged group, including TradeFlow. The Directors
have prepared the forecast using their best estimates, information
and judgement at this time including the new funding facility that
has been secured by the Company which was announced on 29 September
2021 and expected cashflows arising from TradeFlow's investment
advisory services ("IA" revenue stream) as well as from the use of
the Group's innovative Platform to facilitate inventory
monetisation transactions ("C.IM" revenue stream). This reflects
the fact that the Directors expect the Group to fully
operationalise the business model in the near future.
Despite the facts outlined above, there is currently an absence
of a historical track record relating to inventory monetisation
transactions being facilitated by the Group's Platform, the Group
generating the full range of fees from the use of its Platform and
the Group being cash flow positive. As such the Directors have
prudently identified uncertainty in the cash flow model. This
uncertainty arises with respect to both the future timing and
growth rates of the forecast cashflows arising from the Group's
multiple revenue streams referred to above. In this regard, if
these future revenues are not secured as the Directors envisage, it
is possible that the Group will have a shortfall in cash and
require additional funding during the forecast period. On the basis
of the above, the Directors believe there is a material uncertainty
in relation to its going concern status.
The Directors do however remain confident in the business model
and believe the Group could be managed in a way to allow it to meet
its ongoing commitments and obligations through mitigating actions
including cost saving measures and securing alternative sources of
funding should this be required. As such the Directors consider it
appropriate to prepare these interim financial statements on a
going concern basis and have not included the adjustments that
would result if the Company and Group were unable to continue as a
going concern.
4. Significant changes in the current reporting period
On 16 June 2021, the group entered a subscription agreement with
Negma Group Ltd for the issue of an initial tranche of GBP5,600,000
of convertible loan notes. As at 30 June 2021, the group has
received cash of GBP5,000,000.
The difference between the par value of the convertible loan
notes and the cash received is the effective interest charged in
relation to these instruments. The total interest of GBP600,000 has
being accrued by management using their best estimate as to the
dates at which Negma Group Ltd would require the Company to convert
the loan notes into ordinary shares. As at 30 June 2021, the Group
had recognised an interest cost of GBP190,000 in relation to the
convertible loan notes, with the remaining interest charge expected
to be recognised before the end the financial year.
Note 16 ("Events occurring after the reporting period") contains
details of the convertible loan note conversion to ordinary shares
in the period between 30 June 2021 and the date at which these
interim financial statements have been issued. These are also
summarised below:
-- On 6 July 2021 the Company made an application for admission
to trading of 164,705,882 New Ordinary Shares as conversion of
GBP560,000 (10%) of the convertible loan notes.
-- On 28 July 2021 the Company made an application for admission
to trading of 315,000,000 New Ordinary Shares as conversion of
GBP1,008,000 (18%) of the convertible loan notes.
-- On 2 September 2021 the Company made an application for
admission to trading of 840,000,000 New Ordinary Shares as
conversion of GBP2,016,000 (36%) of the convertible loan notes.
5. Revenue and operating segments
For the current six-month period there is one continuing class
of business, being the investment in the financial technological
sector. Given that there is only one continuing class of business,
operating within Italy no further segmental information has been
provided.
6. Exceptional costs
6 months 6 months
to to
30 June 2021 30 June 2020
GBP '000 GBP '000
Deemed cost of listing - 1,369
============== ==============
The prior year exceptional cost relates to the reverse
acquisition of Supply@ME S.r.l. and has been accounted for under
IFRS 2 Share Based Payments. Under IFRS 2, the deemed cost of
obtaining the listing was expensed to profit and loss.
7. Taxation
Income tax expense for the period to 30 June 2021 primarily
represents the movement in the deferred tax assets during the
six-month period ended 30 June 2021. The deferred tax asset
movement largely relates to the decrease in deferred income which
has been described in Note 12 ("Trade and other payables"). As this
movement resulted from amounts being recognised as revenue in the
current interim period, or amounts no longer expected to be
recognised as revenue in the future, the deferred tax asset has
been adjusted and the balance as at 30 June 2021 is GBP209,000
compared to GBP422,000 as at 31 December 2020.
To date any accumulated tax losses resulting from net losses in
the consolidated financial statement have not been recognised in
the balance sheet given the Group does not have a track record of
generating profits against which these accumulated losses could be
offset.
8. Dividends
During the half-year to 30 June 2021 the Group did not pay a
dividend (2020: no dividend).
The Directors do not foresee a dividend being payable in the
next financial year as the Group will be concentrating on growing
its market share and enhancing its technology and capabilities.
9. Earnings per share
The calculation of the Basic earnings per share (EPS) is based
on the loss attributable to equity holders of the parent for the
period of GBP1,910,000 (2020: loss of GBP2,795,000 divided by the
weighted average number of ordinary shares in issue of
32,754,944,590 (2020: 21,389,239,785). The basic EPS from
continuing operations is (0.01) pence (2020: (0.01)).
10. Intangible assets
Capitalised internally developed platform costs
GBP'000
Cost
At 1 January 2020 606
Additions 459
------------------------------------------------
At 30 June 2020 1,065
Additions 568
------------------------------------------------
At 31 December 2020 1,633
Foreign exchange translation (75)
------------------------------------------------
At 1 January 2021 1,558
Additions 529
At 30 June 2021 2,087
------------------------------------------------
Accumulated amortisation
At 1 January 2020 194
Amortisation charge 99
------------------------------------------------
At 30 June 2020 293
Amortisation charge 104
------------------------------------------------
At 31 December 2020 397
Foreign exchange translation (18)
------------------------------------------------
At 1 January 2021 379
Amortisation charge 176
At 30 June 2021 555
------------------------------------------------
Carrying amount
At 30 June 2021 1,532
================================================
At 31 December 2020 1,236
================================================
At 30 June 2020 772
================================================
11. Trade and other receivables
30 June 31 December
2021 2020
GBP '000 GBP '000
Trade receivables 4 489
Other receivables 403 601
Prepayments 222 23
--------- ------------
629 1,113
========= ============
12. Trade and other payables
30 June 31 December
2021 2020
GBP '000 GBP '000
Banks loans and overdrafts 22 22
Trade payables 1,134 1,062
Other payables 851 271
Social security and other taxes 755 792
Accruals and deferred income 541 1,248
--------- ------------
3,303 3,395
========= ============
Included within accruals and deferred income as at 30 June 2021
is deferred income of GBP397,000 (31 December 2020: GBP1,131,000).
The decreased in deferred income over the current interim period is
a result of:
-- GBP182,000 being recognised as revenue in the six-month
period ended 30 June 2021 in line with the due diligence
performance obligations having been satisfied during this time;
and
-- A number of refunds having been requested from client
companies during the six-month period ended 30 June 2021 in
connection with the Group's older contracts that allowed for this.
The majority of these refunds were due for repayment as at 30 June
2021 and were recorded within other payables on the balance sheet.
Management are confident that some of these client companies are
likely to return following the first inventory monetisation
transactions being executed on the Platform.
13. Convertible loan notes
30 June 31 December
2021 2020
GBP '000 GBP '000
Convertible loan notes 5,190 -
========= ============
As set out in note 4 ("Significant changes in the current
reporting period") on 16 June 2021, the Group issued GBP5,600,000
of convertible loan notes at an effective interest rate of 12%. As
at 30 June 2021, the Group has received GBP5,000,000 in cash and
recognised accrued income of GBP190,000, based on the expected rate
of conversion. Further details are disclosed in note 4.
14. Provisions
Provision Provision
for risks for VAT
Post-employment and and
benefits charges penalties Total
GBP'000 GBP'000 GBP'000 GBP'000
Carrying
amount at
31 December
2020 32 40 286 358
FX
translation (1) (2) (14) (17)
--------------------------- --------------------- --------------------- -------------------
Carrying
amount at 1
January
2021 31 38 272 341
Released to - - - -
profit and
loss
Provided for
in the
half-year 3 - - 3
--------------------------- --------------------- --------------------- -------------------
Carrying
amount at
30 June
2021 34 38 272 344
=========================== ===================== ===================== ===================
15. Share capital
Allotted, called up and fully paid shares
30 June 2021 31 December 2020
No. GBP No. GBP '000
'000
Ordinary
shares of
GBP0.00002
each 32,754,944,590 655 32,754,944,590 655
Deferred
shares of
GBP0.04
each 63,084,290 2,523 63,084,290 2,523
2018
deferred
shares of
GBP0.009998
each 224,193,710 2,242 224,193,710 2,242
-------------------------- ------------------ -------------------------- --------------------
Total 33,042,222,590 5,420 33,042,222,590 5,420
========================== ================== ========================== ====================
16. Events occurring after the reporting period
On 1 July 2021 , the Group completed the acquisition of the
entire issued share capital of TradeFlow Capital Management Pte.
Ltd ("TradeFlow"). TradeFlow is a leading Singapore-based
FinTech-powered commodities trade enabler focused on SMEs.
TradeFlow was valued at approximately GBP31 million by an
independent valuation company. The Parties agreed that the
transaction price will be settled in cash (through an initial
payment of GBP4,000,000) and the issue of 813 million New Ordinary
shares, which were admitted to trading on 7 July 2021. The impact
of the business combination will be accounted for in line with IFRS
3 (Business Combinations) as part of the Group's consolidated
financial statements for the year ended 31 December 2021.
On 6 July 2021 , the Group has made an application for admission
to trading of 1,477,705,882 New Ordinary Shares, which were then
admitted to trading on 7 July 2021. 813 million of these New
Ordinary Shares were issued as consideration to the TradeFlow
sellers (as detailed above). The remaining New Ordinary Shares were
issued for the following purposes:
-- 500 million New Ordinary Shares as consideration to
intermediaries and introducers which support the deal;
-- 164,705,882 New Ordinary Shares as conversion of GBP560,000
(10%) of the convertible loan notes issued and subscribed by Negma
Group.
On 22 July 2021 , Dominic White, the previous Non-Executive
Chairman, informed the Board of his decision to step down as a
Director of the Company in order to focus on his other business
interests.
On the same date, the Company announced the appointment of Mr
David Bull to the Board as a Non-Executive Director with
responsibility for the Audit Committee.
On 28 July 2021, the Group has made an application to the London
Stock Exchange for admission to trading of 315,000,000 New Ordinary
Shares as a result of the conversion GBP1,008,0000 (18%) of the
convertible loan notes issued and subscribed by Negma Group. These
shares were admitted to trading on 29 July 2021.
On 30 July 2021 , the Group held the 2020 AGM during which Tom
James and John Collis were appointed to the Board as new Executive
Directors with responsibility for leading the TradeFlow
business.
On 9 August 2021, the Group announced that it has agreed with
Apex Group to launch a comprehensive inventory monetisation fund,
comprising four components ("the funds"):
-- two funds focussed on "inventory in-transit" monetisation
(import/export transactions), advised by TradeFlow.
-- two new funds, focussed on "warehoused goods monetisation".
These funds will also be advised by TradeFlow and will be focused
on UK, UK Common law (including MENA region) and Italian
monetisation transactions.
In addition, TradeFlow Capital funds received an Investment
Grade final rating from a leading ratings agency for its 4-year
Senior Note. Leveraging the global investor network of the Group,
the funds have already secured investors subscribing for the full,
initial $40m issuance.
On 2 September 2021 , the Company announced the signing of a
term sheet for a short-term loan facility and made a further
application for admission to trading of 840,000,000 New Ordinary
Shares as a result of the conversion GBP2,016,0000 (36%) of the
convertible loan notes issued and subscribed by Negma Group to be
allotted to Negma Group. These shares were admitted to trading on 3
September 2021.
On 29 September 2021, the Company announced the finalisation of
its new funding facility with Mercator Capital Management Fund LP
("Mercator") and its intention to repay the remaining outstanding
balance of the GBP2,016,000 with Negma Group as cash using the
proceeds of the new funding facility.
The new funding facility consisted of a short-term loan with the
following key terms:
-- Initial draw down of GBP5 million, with a further GBP2
million available within 60 days subject to certain conditions
precedent;
-- 12 month term, with an interest rate of 10%; and
-- Warrants will be issued representing 20% of both tranches.
The warrants will have a term of 3 years from issue and an exercise
price of 130% of the lowest closing VWAP over the ten trading days
immediately preceding the issue of the warrants.
The short-term loan note facility will be linked to a
Convertible Loan Note facility (CLN), which can be used should SYME
elect not to repay any of the interest or principal relating to the
short-term loan notes in cash (for example, if the Company decides
to preserve cash for working capital requirements or to facilitate
further new strategic initiatives). The CLN facility is for the
same aggregate value as the short-term loan facility including
interest (GBP7.7 million) and can be drawn in tranches equal to the
monthly loan repayments. The CLN contains the following key
terms:
-- Issued at par value;
-- 12 month term with a conversion price of 85% of the lowest 10
day closing VWAP prior to the issue of the conversion notice.
Mercator can convert CLNs on request once issued. The Company can
elect to repay in cash any CLNs which are not subject to any
conversion requests at 105% of the outstanding nominal value;
-- Any CLNs outstanding on the first anniversary of issue will
automatically convert into Ordinary Shares; and
-- Warrants will be issued for 20% of each tranche. The warrants
will have a term of 3 years from issue and an exercise price of
130% of the lowest closing VWAP over the ten trading days
immediately preceding the request to issue a new tranche.
The Company has given Mercator customary warranties in respect
of certain commercial matters. The Company has also agreed not to
undertake certain matters without the Investor's consent (not to be
unreasonably withheld, delayed or conditioned), including
undertaking further indebtedness, charging its assets and issuing
shares (subject to certain exemptions, including share issues to
employees, directors and their related parties).
17. Related party transactions
During the six-month period to 30 June 2021, the following are
treated as related parties:
Alessandro Zamboni
Alessandro Zamboni is the Sole Director of The AvantGarde Group
S.p.A as well as holding numerous directorships across companies
(including AZ company S.r.l - a private limited company) that are
related parties.
Following historical transactions with AZ company S.r.l the
Group has an amount payable of GBP63,000 to this related party.
The AvantGarde Group S.p.A
The AvantGarde Group currently holds 36.0% the shares in
Supply@ME Capital plc (as at 30 June 2021: 38.9%).
As announced in the RNS issued on 24 December 2020, 1AF2 S.r.l.
and the AvantGarde Group S.p.A (TAG) previously merged together.
Alessandro Zamboni was also a Director of 1AF2 S.r.l. During the
six-month period ended 30 June 2021, GBP167,000 of the Group's
revenue related to client companies originated by TAG (previously
1AF2 S.r.l) and for which the Group charged due diligence fees to
TAG. This revenue was recognised in line with the Group's revenue
recognition policy.
The TAG Group includes RegTech Open Project S.p.A, regulatory
technology company focussed on the development of an integrated
risk management platform for Banks, Insurance Companies and Large
Corporations.
Following the reverse takeover in March 2020, the Company
entered into a Master Service Agreement with TAG in respect of
certain shared service to be provided to the Group. During the
current six-month period, the Group paid GBP50,000 to TAG in
respect of this agreement.
Following the above and historical transactions with TAG and its
subsidiaries the Group has an amount payable of GBP273,000.
Trumar Capital LLC
The beneficial owner of Trumar Capital LLC is Dominic White, the
previous Non-Executive Chairman of SYME.
Eight Capital Partners Plc
Dominic White, the previous Non-Executive Chairman, is a
director of Eight Capital Partners PLC. Trumar Capital owns 29.9%
of Eight Capital Partners Plc. Following the reverse takeover in
March 2020, the Company entered into a Master Service Agreement
with Eight Capital Partners Plc in respect of certain shared
service to be provided to the Group. During the current six-month
period, the Group paid GBP36,000 to Eight Capital Partners Plc in
respect of this agreement. There are no balances outstanding as at
30 June 2021.
Dominic White
Dominic White holds directorships across these companies that
are therefore related parties (Truman Capital LLC, iWEP Ltd, iWolf
Ltd, White Amba Investments LLP and Eight Capital Partners
Plc).
18. Financial instruments
Financial assets at amortised cost
Carrying value Fair value
31 31
30 June December 30 June December
2021 2020 2021 2020
GBP'000 GBP'000 GBP'000 GBP'000
Cash and
cash
equivalents 4,201 552 4,201 552
Trade
receivables 4 489 4 489
Other
receivables 403 601 403 601
---------------------- --------------------- ---------------------- ---------------------
4,608 1,642 4,608 1,642
====================== ===================== ====================== =====================
Valuation methods and assumptions:
The directors believe that the fair value of all financial
assets at amortised cost approximate to their carrying values.
Financial liabilities at amortised cost
Carrying value Fair value
31 31
30 June December 30 June December
2021 2020 2021 2020
GBP'000 GBP'000 GBP'000 GBP'000
Bank loans
and
overdrafts 22 22 22 22
Trade
payables 1,134 1,062 1,134 1,062
Other
payables 854 271 854 271
Convertible
loan notes 5,190 - 5,190 -
---------------------- --------------------- ---------------------- ---------------------
7,200 1,355 7,200 1,355
====================== ===================== ====================== =====================
Valuation methods and assumptions:
The directors believe that the fair value of all financial
liabilities at amortised cost approximate to their carrying
values.
Financial liabilities at fair value through profit and loss
Fair value
30 June 2021 31 December 2020
GBP'000 GBP'000
Derivative financial instruments 24 24
24 24
======================== ============================
Valuation methods and assumptions:
Further information relating to the valuation of the derivative
financial instruments is available in note 22 of the annual
financial statements for the year ended 31 December 2020.
19. Financial risk management
Note 22 to the annual financial statements for the year ended 31
December 2020 include the Group's objectives, policies and
processes for managing its capital; its financial risk management
objectives; details of its financial instruments and its exposure
to interest rate risk, credit risk, foreign exchange risk and
liquidity risk.
20. Prior period adjustment in respect of the six-month period
to 30 June 2020
Changes to the income statement
As
previously As
Notes reported Adjustment restated
GBP'000 GBP'000 GBP'000
Revenue (i) 368 (368) -
Cost of sales (ii) - (238) (238)
Administrative
expenses (ii) (1,112) (117) (1,229)
Exceptional costs (1,369) - (1,369)
Taxation (i)(ii) (29) 88 59
---------------------- ---------------------- --------------------
Loss for the year (2,142) (635) (2,777)
---------------------- ---------------------- --------------------
Loss per share (pence) (0.01) - (0.01)
---------------------- ---------------------- --------------------
Changes to the statement of changes in equity
As
previously As
Notes reported Adjustment restated
GBP'000 GBP'000 GBP'000
Share capital 5,420 - 5,420
Share premium (iii) 11,485 335 11,820
Other reserves (iii) 50 (38) 12
Merger relief
reserve (iii) 223,831 1 223,832
Reverse
takeover
reserve (iii) (237,875) 41 (237,834)
Foreign
exchange
reserve (iii) 2 (17) (15)
Retained
earnings (i)(ii) (1,911) (1,617) (3,528)
---------------------- ---------------------- ---------------------
Net assets / (liabilities) 1,002 (1,295) (293)
====================== ====================== =====================
Notes to the changes
All of the restatements referred to below were made in order to
ensure the comparative figures for six-months ended 30 June 2020
were presented using consistent accounting policies as applied in
the annual audited financial statements for the year ended 31
December 2020.
(i) Decrease in revenue
The revenue for the comparative six-month period ended 30 June
2020 has been restated from GBP368,000 to nil. During the
preparation of the interim financial statements for the six-month
period ended 30 June 2020, revenue had been recognised in line with
when the due diligence services had been delivered by the Group,
however on closer analysis of the Group's older contracts (those
which had been agreed pre June 2020), it was determined that these
agreements identified the performance obligation as the use of the
Group's Platform for the first time by the client company in order
to facilitate an inventory monetisation transaction. In addition,
the amounts paid by the client companies pre 30 June 2020 were
refundable under certain circumstances and up to the point when the
Platform was able to be used for the first time by the client
companies. As this performance obligation has not yet been
satisfied by the Group, the amounts received did not meet the
revenue recognition criteria in IFRS 15 and as such these amounts
were removed from revenue and instead recognised as deferred income
on the balance sheet as at 30 June 2020. There was also a
corresponding opening balance sheet adjustment as at 1 January 2020
of GBP981,000 for the same reason. The associated impact on
taxation has also been recognised.
(ii) Increase in and reclassification of costs
Costs for the six-month period ended 30 June 2020 have also been
restated and increased by GBP355,000 (this included the cumulative
impact across the cost of sales and administrative expenses shown
in the table above). This increase was principally a result of the
restatement of GBP335,000 of legal costs which had previously been
deducted from share premium. Further details are provided in point
(iii) below.
In addition, GBP20,000 of additional costs were identified as
relating to the period ended 30 June 2020 and have now been
recognised. This primarily relates to the capitalisation of costs
in accordance with IAS 38 and the associated amortisation charge.
During the production of the 2020 annual report and accounts there
were some adjustments made to amounts that have previously been
capitalised. These corresponding adjustments have been reflected in
the restated administration expenses for 30 June 2020.
The associated impact of these changes on taxation has also been
recognised.
In addition to the restatement referred to above, GBP238,000 of
costs have been reclassified from administration expenses to costs
of sales to ensure consistency with the cost of sales accounting
policy applied in the annual audited financial statements for the
year ended 31 December 2020.
(iii) Restatement of reverse acquisition
During the preparation of the annual financial statements for
the year ended 31 December 2020, the treatment of the reverse
acquisition of Supply@ME S.r.l. was amended. The principal change
was the accounting for legal costs that were incurred in connection
with the reverse acquisition and the issue of new ordinary shares
that took place in March 2020. These costs were initially accounted
for as part of share premium based on an analysis undertaken by
management at the time as to the portion of the costs that related
to the issue of the new ordinary shares. However, during the
preparation of the 2020 annual financial statements, it was
determined that this split was not in line with IAS 32 and as such
GBP335,000 of legal costs were restated to be included as
administrative expenses rather than deducted from share
premium.
The changes in respect of other reserves, merger relief reserve,
reverse takeover reserve and foreign exchange reserve related to
errors in the foreign exchange translation on consolidation of the
subsidiary company. The net impact of these changes is a GBP13,000
increase in net liabilities which have been reflected in the annual
audited financial statements for the year ended 31 December
2020.
Cautionary Statement
These Interim Results have been prepared in accordance with the
requirements of English Company Law and the liabilities of the
Directors in connection with these Interim Results shall be subject
to the limitations and restrictions provided by such law.
These Interim Results are prepared for and addressed only to the
Group's shareholders as a whole and to no other person. The Group,
its Directors, employees, agents, or advisers do not accept or
assume responsibility to any other person to whom these Interim
Results are shown or into whose hands it may come, and any such
responsibility or liability is expressly disclaimed.
These Interim Results contain forward looking statements, which
are unavoidably subject to risk and uncertainty because they relate
to events and depend upon circumstances that will occur in the
future. It is believed that the expectations set out in these
forward-looking statements are reasonable, but they may be affected
by a wide range of variables which could cause future outcomes to
differ from those foreseen. All statements in these Interim Results
are based upon information known to the Group at the date of this
report. Except as required by law, the Group undertakes no
obligation to publicly update or revise any forward-looking
statement, whether as a result of new information, future events or
otherwise.
, the news service of the London Stock Exchange. RNS is approved by
the Financial Conduct Authority to act as a Primary Information
Provider in the United Kingdom. Terms and conditions relating to
the use and distribution of this information may apply. For further
information, please contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
IR WPUWGBUPGUAU
(END) Dow Jones Newswires
September 30, 2021 02:00 ET (06:00 GMT)
Abal (LSE:ABAL)
Historical Stock Chart
From Mar 2024 to Apr 2024
Abal (LSE:ABAL)
Historical Stock Chart
From Apr 2023 to Apr 2024
