TIDMASLR
RNS Number : 2707X
Asimilar Group PLC
30 April 2021
The information contained in this announcement is deemed by the
Company to constitute inside information as stipulated under the EU
Market Abuse Regulation (596/2014). Upon publication of the
announcement via a regulatory information service, this information
is considered to be in the public domain.
ASIMILAR GROUP PLC ('ASIMILAR' OR 'THE COMPANY' OR "THE
GROUP")
Final Results
Asimilar Group plc (AIM: ASLR), the AIM quoted investment
company focused on technology opportunities in the fields of big
data, machine learning, telematics and the Internet of Things (IoT)
, announces its audited Final Results for the year ended 30
September 2020.
Annual Reports and Accounts
The Group's Annual Report and Accounts for the year to 30
September 2020 will be posted to shareholders shortly.
Contacts
Asimilar Group plc
John Taylor, Non-Executive via Buchanan
Chairman
Cairn Financial Advisers LLP
Sandy Jamieson / Liam Murray Tel: +44 20 7213 0880
Peterhouse Capital Limited
Duncan Vasey / Lucy Williams Tel: + 44 20 7220 9797
Buchanan Communications Limited
Richard Oldworth / Chris Lane Tel: +44 (0) 20 7466 5000
Introduction
I am pleased to present the annual report and consolidated
financial statements for Asimilar Group plc ("Asimilar", "the
Group", or "the Company"), for the financial year ended 30
September 2020.
Technology is at the foundation of our investment criteria. We
invest in businesses that develop purpose-built technology and
operational expertise with potential to scale and generate positive
returns for shareholders. We back founders that have a dedicated
passion and competency for creating and engineering premium
customer experiences through technology, content and product
innovation.
As an investment business we evaluate a significant pipeline of
potential investment opportunities based on the principles of our
stated investment criteria. Before investing, the board always
evaluates the opportunities diligently and takes valued input from
key shareholders and our investor partners on the value potential
of the investment opportunities.
As a board we take active positions within our investment
companies so that we can partner and support our investee founders
and boards proactively, in their strategy and business plan
execution, thereby seeking to grow and optimise our investments for
shareholders. As an investment business, we are dependent on the
investee companies successfully executing their business plans and
managing a positive exit for our investment and investors, which
sometimes take longer than initially envisaged.
The board has evaluated a number of options to maintain positive
momentum and capitalise on new opportunities in the market that we
believe are in the best interests of shareholders.
Investment Strategy
On 2 October 2019, we announced that the board had conducted a
review of the Company's investment strategy and that the board had
decided that, in the light of the current market conditions and
pipeline opportunities, within the scope of its current investment
strategy it should give particular focus to technology
opportunities in the fields of big data, machine learning,
telematics and the internet of things (IoT).
Financial Review
Total comprehensive income for the year was GBP392,329 (2019:
loss GBP731,784). Unrealised losses on investments were
GBP1,778,363 (2019: loss GBP52,930) and realised gains on
investments were GBP5,728 (2019 impairment loss: GBP446,973). Cash
at the bank at the year-end was GBP709,819 (2019: GBP242,415).
As at 30 September 2020, total assets were GBP12,547,890 (2019:
GBP2,995,972) and the net fair value of investments held was
GBP8,794,403 (2019: GBP2,684,091). Total net assets were
GBP10,591,255 (2019: GBP2,968,527) which represents 11.60 (2019:
5.69) pence per share.
Other income received during the year was GBP1,140,000 of Mesh
Holdings Plc shares received in exchange for Asimilar's option to
invest in Sentiance NV.
The fair value gain on asset acquisition of GBP1,649,436
represents the difference between fair value of assets and
liabilities acquired on acquisition of Intrinsic Capital (Jersey)
Limited and the consideration paid (further detail is provided in
note 5 of the financial statements).
Simplestream Limited ("Simplestream")
Simplestream create Next Generation TV services for broadcast,
sport and media brands. The company is a market leader for its
Live2VOD and Hybrid TV solutions, including Sports Video Platform,
Cloud TV and Telco TV solutions. Clients include: A&E Networks;
AMC Networks; Nova TV Sony Traceplay; QVC TV; Box Nation; Little
Dot Studios and At The Races amongst others.
Simplestream's cloud based Media Manager platform provides
broadcasters and rights owners with an end-to-end technology
services eco-system, with a full range of multi-platform TV and
video distribution products including: low latency online
simulcasts of TV channels, real-time sports highlights clipping,
broadcaster catch-up services, social video syndication and
subscriber management services.
Simplestream's technology platform also provides multi-channel,
multi-territory frontend templated applications for a complete
range of connected devices including mobiles, tablets, connected
TVs and fast growing over the top (OTT) platforms such as Amazon
Fire TV, Apple TV and Roku. In the UK, Simplestream's "Hybrid TV"
solution is used by leading broadcasters to power "catchup"
services on Freeview, Freesat, YouView and EETV.
Simplestream delivers services across Europe, the US, Africa and
the Far East with further international expansion planned for
2021.
In September 2020 the company raised GBP275,856 under the UK
government supported Future Funds Convertible Loan Scheme. Asimilar
invested GBP21,000 as part of this fund raise.
At 30 September 2020 Asimilar held 9,943 (2019: 9,943) shares in
Simplestream, which represents 6.34% (2018: 6.34%) on a fully
diluted basis.
Gfinity plc ("Gfinity")
Gfinity is a world-leading esports solutions provider. It
focuses on designing, developing and delivering esports solutions
for e-games publishers, rights holders and brands. It has contracts
and partnership arrangements with EA Games, Microsoft, FIFA,
Formula 1 and Indycar.
During the year the company embarked on a major restructuring
program to reduce overhead costs by over 60%. In April 2020 it
successfully raised GBP2.25m. It also agreed a number of deals
including the launch of Virtual Grand Prix series with Formula 1
and a 5 Year partnership with Abu Dhabi Motorsport Management.
Gfinity achieved growth of 641% in monthly users on its Digital
Media Platform over a 12 month period to June 2020.
At 30 September 2020 Asimilar held 400,000 (2019: 400,000)
shares in Gfinity which represent 0.05% (2019: 0.08%) on a fully
diluted basis.
AudioBoom plc ("AudioBoom")
AudioBoom is one of the world's leading spoken-word audio or
podcasting platforms for hosting, distributing and monetising
content that enables the creation, broadcast and syndication of
audio content across multiple networks and geographies.
On 10 February 2020 AudioBoom announced a strategic review and a
Formal Sales Process (FSP) under the City Code on Takeovers and
Mergers. On 14 October 2020 the company announced a fundraise of
GBP3.15m and an end to the strategic review and FSP. The board
considered that "in light of the very encouraging growth and
resilience to global events" to focus on organic growth.
At 30 September 2020 Asimilar held 53,400 (2019: 53,400) shares
in AudioBoom which represents 0.34% (2019: 0.38%) on a fully
diluted basis.
Magic Media Works Ltd ("Magic Media")
Magic Media is a music entertainment technology business. The
company's mission is to bring families together through shared
music entertainment experiences, making every home a connected
home.
ROXi, which was launched by Magic Media in 2017 is the world's
first 'made for TV' music entertainment product, delivering music
entertainment experiences that allow consumers to listen, sing,
dance and play together at home.
ROXi is backed by celebrity curators Kylie Minogue, Robbie
Williams and Sheryl Crow, ROXi delivers its unique interactive
experience through the stylish ROXi Console, as well as through
major Smart TV and Pay TV platforms, including Sky .
Offering unlimited music, karaoke-style singing, global radio
access, an ambient sound machine and ROXi's unique music trivia
game, Name That Tune, ROXi is highly differentiated and popular
with its target market of older, family consumers. The company has
global rights agreements with the major labels (Universal Music
Group, Sony Music Group, Warner Music Group) and major independents
including Merlin Music, providing customers with one year's access
to a premium music catalogue of over 55 million music tracks.
In addition to effortless media discovery and consumption,
ROXi's vision is to create experiences that bring people together
around music, and support activity beyond simply listening to
music, with a clearly differentiated software and hardware
offering. ROXi has built a multi-territory media platform with
localisation available for language, search, catalogue and playlist
curation.
The company strengthened its board through the appointment of
Rupert Howell (ex-MD, ITV plc) as independent Non- Executive
Chairman and Serene Sass (ex-Warner Music) and Carol Weatherall
(ex-eVentures) as independent Non-Executive Directors.
In March 2020 the company launched a new funding raise to
support expansion in the UK and internationally. This round was
over-subscribed and over GBP2.0 million was raised.
On 8 September 2020 Sky Q launched the ROXi music service
bringing entertaining mix of unlimited music, music games, radio
and karaoke to the living room, all in one place.
The partnership means that the ROXi music entertainment
experience will be available on the Sky Q Pay TV platform, without
the need for any additional hardware.
The launch of "ROXi on Sky Q" is part of a wider strategy to
provide the ROXi experience on all major Smart TV and Pay TV
platforms, with Sky being the first European rollout partner.
On 7 December 2020 Asimilar invested a further GBP298,204 in
Magic Media via a subscription to 298,204 loan notes of GBP1.00
each. Interest will be paid on the loan notes at 5%, payable
annually in arrears on the anniversary of the loan note
subscription. The loan notes expire on 31 January 2026. Should
Magic Media not be in a position to satisfy the interest payment in
cash it can elect to satisfy the interest through the issuance of
further loan notes or shares to the loan note holder.
Each loan note has a warrant attached which gives the holder the
right to subscribe for a share in Magic Media at GBP1 per share at
any time during the life of the loan note. The exercise of the
warrants can be carried out by offsetting the exercise subscription
due against the outstanding loan amount, effectively resulting in a
cashless exercise. The subscription forms part of a wider equity
and loan note fundraise of up to GBP13m by Magic Media which was
led by Sun Capital Partners. The equity subscription was carried
out at GBP1.00 per share. The fundraise is being conducted in two
rounds: the first at GBP1.00 per share; and the second, to be
conducted in early 2021, at GBP1.10 per share. Asimilar has the
right, but not the obligation, to retain its equity position in the
second round of financing.
At September 2020 Asimilar held 1,646,682 shares which
represents 7.4% (2019: 7.4%) of the fully diluted share capital.
Asimilar also holds GBP500,000 of convertible loan notes and has
options over a further 95,000 ordinary shares in Magic Media.
Sparkledun Limited ("Sparkeldun")
Sparkledun is a private company which, through its trading
subsidiary, Fast to Fibre Limited ("Fast to Fibre"), has rights to
exploit a patented process for the extraction of the inner core of
telecoms and power cables, allowing the insertion of fibre optic
without the need for excavation or other disruptive techniques.
The Fast to Fibre commercial proposition is to reduce the cost
of fibre optic deployment particularly in difficult to access areas
such as urban and city centres, thereby increasing the pace of
adoption in line with government targets around the world to
provide ultra-fast internet access. Fast to Fibre has successfully
completed several trials in a variety of geographical locations and
complex situations and is now progressing a number of major
commercial opportunities in the UK, Europe, North America and
India.
At 30 September 2020 Asimilar held 3,260 ordinary shares of
GBP1.00 each in the issued share capital of Sparkeldun, which
represents 1.88% of its issued share capital.
SeeQuestor Limited ("SeeQuestor")
SeeQuestor brings together leaders in cyber security and
computer vision to deliver an Artificial Intelligence ("AI") tool
to comb through some of the estimated 1.5 trillion hours of CCTV
footage produced per year, harnessing what the Directors believe to
be world leading AI technology and affordable supercomputing to
turn terabytes of video into actionable intelligence.
SeeQuestor has two main products available: SeeQuestor
'Post-Event' which allows teams to comb through archives of video
footage to find persons of interest or vehicles, helping to solve
investigations in a fraction of the time that would otherwise be
needed; and SeeQuestor 'iCCTV' which monitors surveillance cameras
in real-time. Use cases range from homeland security to smart
cities, airports, industrial and mining operations.
The SeeQuestor 'Post-Event' product has been used successfully
to solve crimes by 20 police forces in the UK and overseas. Having
successfully completed a number of pilots in the field through
2019, SeeQuestor 'iCCTV' is now being deployed at scale to secure
sensitive events and sites in several countries.
On 27 February 2020, Asimilar held 47,018 ordinary shares of 1
pence each in the capital of SeeQuestor representing approximately
4.7 per cent of the issued share capital of SeeQuestor.
On 9 November 2020, Intrinsic Capital (Jersey) Limited, a 100%
subsidiary of Asimilar, invested a further GBP250,000 for 16,892
new equity shares.
0n 31 December 2020 Intrinsic Capital (Jersey), invested a
further GBP250,000 for new equity shares and was also granted a 1
for 1 warrant to subscribe for further new ordinary shares in
SeeQuestor. These warrants will also apply to the previous
investment of GBP250,000 on 9 November 2020. The warrants are
exercisable from the date of grant until 31 December 2021 and will
exercise at a discount to the subscription price of this investment
round.
Intrinsic Capital (Jersey) Limited
On 30 August 2020 Asimilar acquired Intrinsic Capital (Jersey)
Limited ("ICJL") to allow Asimilar to manage its portfolio with the
benefit of the more benign capital gains tax regime available in
Jersey in respect of some of its current and future
investments.
In addition, ICJL was a party to an investment agreement with
Dev Clever Holdings Plc ("Dev Clever"), as announced by Dev Clever
on 13 May 2020, giving ICJL a right to subscribe for up to
100,000,000 ordinary shares in Dev Clever at a price of 10 pence
per Dev Clever share (the "Dev Clever Investment Agreement") and,
following the exercise of all of these subscription rights, ICJL
would be entitled to exercise a warrant to subscribe for up to
50,000,000 additional Dev Clever shares at a price of 25 pence per
Dev Clever Share (the "Dev Clever Warrant").
At the date of acquisition ICJL had exercised part of the option
and invested GBP250,000 for 2,500,000 of DevClever shares.
Under the terms of the acquisition agreement of ICJL, the
Company acquired the entire issued share capital of ICJL in return
for the issuance of 1,000,000 new Asimilar ordinary shares credited
as fully paid ("Consideration Shares"). In addition Mark Horrocks,
the sole owner of ICJL, was granted warrants to subscribe for up to
9,000,000 Asimilar ordinary shares in 2 tranches of up to 4,500,000
warrants per tranche. Each tranche will be exercisable for two
years after the relevant price criteria in Dev Clever having been
reached. The relevant price criteria are the mid-market closing
price of Dev Clever Shares for a period of five consecutive
Business Days being or exceeding (i) 28 pence; and (ii) 55 pence
respectively. The number of warrants which Mr Horrocks will be able
to exercise will be proportional to the number of shares in Dev
Clever subscribed for by the Company or ICJL pursuant to the Dev
Clever Investment Agreement at the date of exercise of such
warrants.
Dev Clever Holdings Plc ("DevClever")
Dev Clever Holdings Plc, together with its wholly owned
subsidiary DevClever Limited, is a software and technology group
based in Tamworth, United Kingdom, specialising in the use of
lightweight integrations of cloud-based gamification and VR
technologies to deliver rich customer engagement experiences across
both the commercial and education sectors. In January 2019, Dev
Clever listed on the Standard List of the London Stock
Exchange.
On 3 September 2020, ICJL exercised its right to subscribe for
17,500,000 shares in the capital of Dev Clever at a price of 10
pence per Dev Clever share for an aggregate subscription amount of
GBP1.75 million in accordance with the terms of the amended Dev
Clever Investment Agreement.
On 1 December 2020 ICJL announced its intention to exercise the
second tranche of the Dev Clever option. This became unconditional
on 26 January 2021 resulting in a further investment of
GBP2,000,000 for 20m new shares.
On 25 February 2021 the Company announced that it had assigned
the right to subscribe for 30m shares in Dev Clever to Sitius
Limited (Sitius") for a cash consideration of GBP3m. In addition,
ICJL assigned some 15m of the warrants to subscribe for new Dev
Clever shares at 25p each to Sitius for a further cash
consideration of GBP500k. Asimilar also announced on 1 March 2021
of ICJL's intention to use the proceeds from this assignment to
complete its subscription for a further 30m shares in Dev Clever at
10p per share which was completed on 18 March 2021.
Asimilar now has an interest in 70 million ordinary shares in
Dev Clever representing approximately 12.2 per cent. of Dev
Clever's issued share capital. In addition to the 70 million
ordinary shares, Asimilar retains a warrant to subscribe for 35
million new ordinary shares in Dev Clever at 25 pence per Dev
Clever share.
The interest in Dev Clever is held via Asimilar's wholly owned
subsidiary, Intrisic Capital (Jersey) Limited.
On 29 March 2021, the Company announced that the mid-market
closing price of shares in Dev Clever had exceeded 28 pence for a
period of five consecutive Business Days. Therefore 70 per cent of
the first tranche of 4,500,000 warrants (equating to 3,150,000
warrants) issued to Mark Horrocks had vested. The 3,150,000
warrants are exercisable at 0.01 pence per Asimilar ordinary share
until 29 March 2023.
Mesh Holdings Plc ("MESH")
MESH is an unlisted investment business, that aims to incubate
emerging technology brands. On 3 August 2020 Asimilar announced
that it had reached an agreement with MESH whereby the Company
received a consideration of 24 million MESH shares in return for
the assignment of Asimilar's right to subscribe for up to 32% of
the share capital of Sentiance N.V. ("Sentiance").
MESH has a number of technology investments including Sentiance.
Asimilar's holding of 24m shares accounts for 8.89 of MESH's issued
share capital as at 30 September 2020.
Sentiance is an emerging and leading organisation within
behavioural, ethical artificial intelligence and machine learning
with its "Motion Intelligence" and "Behavioural Change Platform"
technologies. Sentiance has announced new partnerships, extended
partnerships and contracts with well- known international
businesses, including several within the Fortune 500.
On 15 February 2021 MESH announced that it had entered into a
definitive sale and purchase agreement together with AAQUA BV to
acquire 100% of Sentiance. On completion MESH would own 80% of
Sentiance on a fully diluted basis with the remaining 20% owned by
AAQUA BV. On 9 March 2021, MESH announced that the terms of the
sale and purchase agreement has been amended and that AAQUA BV
would now acquire a significant majority equity holding in
Sentiance, rather than the 20% envisaged under the agreement, and
that completion of the agreement is expected by 31 March 2021.
At 30 September 2020 the MESH holding represent 8.89% of its
issued share capital
COVID -19 statement
The global outbreak of coronavirus COVID-19 during the year
continues to impact on the markets and business activity. The board
has been in discussions, where possible, with its investee
companies to better understand the impact on their business and
actions taken to protect the businesses.
Our investee companies have carried out risk assessments and
successfully implemented a number of actions to protect their
workers, and businesses:
- Working from home arrangements
- Furlough arrangements
- Bounce back loans
- Future fund loans
- CBIL
Share issue
On 11 October 2019, Asimilar successfully raised GBP500,000
before costs by a placing of 20,000,000 new ordinary shares. Under
the placing each placee received one warrant for every two placing
shares. The warrants were exercisable at 6.00p per share at any
time from the date of admission of the placing shares up to 30
October 2020. A further 2,500,000 warrants exercisable on the same
terms were also issued in lieu of fees payable to an
introducer.
On 23 December 2019 Asimilar completed tranche two of the
October 2019 fundraise whereby a further GBP250,000 was raised
through the issue of 10,000,000 million new shares at price of
2.50p per share and one warrant for every two placing shares was
issued. The warrants were exercisable up to 31 October 2020.
On 20 January 2020 Asimilar completed another fundraise of
GBP1,850,000 before costs by the placing of 11,562,500 new ordinary
shares at 16.00p. Under the placing each place also received one
warrant for every placing share. The warrants are exercisable at
30.00p per share at any time from the grant to 31 March 2021. On 31
March 2021 the Company announced that it had agreed to extend the
final exercise date of the warrants from 5pm on 31 March 2021 to
5pm on 9 April 2021.
On 21 January 2020 Asimilar raised GBP83,333.35 via the issue of
1,666,667 new ordinary shares as a result of the exercise of
options at 5.00p per share.
On 24 January 2020 Asimilar raised GBP4,000,000 before costs by
a placing of 10,000,000 new ordinary shares at a placing price of
40.00p per share. Under the placing each place received one warrant
for every placing share. The warrants are exercisable at 130.00p
per share at any time from the date of grant to 31 December 2021,
with an accelerated exercise provision in the event that the mid-
market price of Asimilar's ordinary shares reaches 280.00p per
ordinary share for five consecutive days. The warrants will be
required to be exercised within 21 calendar days of such an
event.
On 1 September 2020 Asimilar issued 1,000,000 shares at 28.00p
per new ordinary shares as part of the consideration for the
acquisition of Intrinsic Capital (Jersey) Limited.
On 22 September 2020 Asimilar raised GBP60,000 via the issue of
1,000,000 new ordinary shares as result of exercise of options at
6.00p per share.
Post Year End Transactions
Sentiance loan of EUR3m was assigned to Mesh Holdings Plc on 30
November 2020 for a cash consideration of EUR3m.
Donald Stewart stepped down from the board on 26 October
2020.
GBP2m was invested into Dev Clever via ICJL announced on 2
November 2020 and completed on 26 January 2021 when it became
unconditional. On 27 January 2021 agreement was reached with Dev
Clever to accelerate the option rights in return for the award of
50,000,000 warrants immediately rather than at the conclusion of
the completion of all further options to subscribe in Dev
Clever.
On 25 February 2021 the Group announced that it had assigned the
right to subscribe for 30m shares in Dev Clever to Sitius Limited
("Sitius") for a cash consideration of GBP3m. In addition, ICJL
assigned some 15m of the warrants to subscribe for new Dev Clever
shares at 25p each to Sitius for a further cash consideration of
GBP500k. Asimilar also announced on 1 March 2021 of ICJL's
intention to use the proceeds from this assignment to complete its
subscription for a further 30m shares in Dev Clever at 10p per
share which was completed on 18 March 2021.
Asimilar now has an interest in 70 million ordinary shares in
Dev Clever representing approximately 12.2 per cent. of Dev
Clever's issued share capital. In addition to the 70 million
ordinary shares, Asimilar retains a warrant to subscribe for 35
million new ordinary shares in Dev Clever at 25 pence per Dev
Clever share.
On 9 November 2020 ICJL invested GBP250,000 in SeeQuestor.
On 7 December 2020 Asimilar made a further investment in Magic
Media of GBP298,204 provided by way of a convertible loan note as
part of a GBP13m raise by Magic Media.
On 31 December 2020 ICJL invested further GBP250,000 in
SeeQuestor increasing the Group's holding to 80,802 shares and
under the terms of the investment Asimilar is was granted a one for
one warrant exercisable by 31 December 2021 at a discount to the
equity subscription price.
Investment Strategy
Our vision is to be a successful and profitable investment
company focusing on technology, travel, leisure and media sectors
with a particular focus in the fields of big data, machine
learning, telematics and the internet of things (IoT). We will
achieve this by identifying early stage or turnaround opportunities
that require investment and or have the potential for a reverse
takeover. We will invest in to businesses with content and delivery
capability that engage customers, monetise the user experience and
have potential to scale.
The Company's investing policy is to invest into businesses
which have some or all of the following characteristics:
-- strong management with a proven track record;
-- ready for investment without the need for material re-structuring by the Company;
-- generating positive cash flows or imminently likely to do so;
-- via an injection of new finances or specialist management,
the Company can enhance the prospects and therefore the future
value of the investment;
-- able to benefit from the directors' existing network of contacts; and
-- the potential to deliver significant returns for the Company.
Whilst the directors will be principally focused on making an
investment in private businesses, they would not rule out
investment in listed businesses if this presents, in their
judgement, the best opportunity for shareholders.
The Company intends to be an active investor in situations where
the Company can make a clear contribution to the progress and
development of the investment. In respect of other, more
substantial investment opportunities, the directors expect that the
Company will be more of a passive investor.
The directors believe that their broad collective experience
together with their extensive network of contacts will assist them
in the identification, evaluation and funding of appropriate
investment opportunities. When necessary, other external
professionals will be engaged to assist in the due diligence on
prospective targets and their management teams.
There will be no limit on the number of projects into which the
Company may invest, and the Company's financial resources may be
invested in a number of propositions or in just one investment,
which may be deemed to be a reverse takeover pursuant to Rule 14 of
the AIM Rules. Where the Company builds a portfolio of related
assets it is possible that there may be cross-holdings between such
assets. The Company does not currently intend to fund any
investments with debt or other borrowings but may do so if
appropriate.
The Company's primary objective is that of securing for the
shareholders the best possible value consistent with achieving,
over time, both capital growth and income for shareholders through
developing profitability coupled with dividend payments on a
sustainable basis.
Outlook
The Board will continue to pursue and evaluate opportunities
that meet the investment criteria.
I would like to thank our shareholders and advisors for sharing
our vision and supporting the board.
John Taylor
Chairman
Date: 30 April 2021
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEARED 30 SEPTEMBER 2020
2020 2019
Notes GBP GBP
Revenue 6 14,000 14,000
Other income 6 1,140,000 -
Administrative expenses (1,043,099) (246,306)
Fair value gain on asset acquisition 5 1,694,436 -
Gains from remeasurement of derivative
financial liabilities 17 436,500 -
Realised gains/(losses) on investment disposals 5,728 (446,974)
Remeasurement to fair value of investments
in financial assets 13,14 (1,778,363) (52,930)
------------------ ---------------------
OPERATING PROFIT/(LOSS) BEFORE FINANCING
ACTIVITIES 469,202 ( 732,210)
Finance income 7 49,945 426
Finance cost 7 (126,818) -
------------------ ---------------------
PROFIT / (LOSS) BEFORE TAX 8 392,329 (731,784)
Tax charge 11 - -
------------------ ---------------------
PROFIT / (LOSS) AFTER TAX 392,329 (731,784)
------------------ ---------------------
Earnings / Loss per share (pence per share)
Basic earnings / (loss) 12 0.41p (1.40)p
========= =========
Diluted earnings / (loss) 12 0.28p (1.40)p
========= =========
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
FOR THE YEARED 30 SEPTEMBER 2020
2020 2019
Notes GBP GBP
ASSETS
Non-current assets
Investments in financial
assets held at fair value 13 5,771,908 2,684,091
-------------------- --------------------
5,771,908 2,684,091
-------------------- --------------------
Current assets
Investments in financial
assets held at fair value 13 3,022,495 -
Financial assets held at
amortised cost 13 2,771,426 -
Trade and other receivables 15 182,242 69,466
Cash and cash equivalents 709,819 242,415
-------------------- --------------------
6,685,982 311,881
-------------------- --------------------
TOTAL ASSETS 12,457,890 2,995,972
========== ==========
EQUITY AND LIABILITIES
Current liabilities
Trade and other payables 16 197,135 27,445
Derivative financial liabilities
held at fair value 17 1,669,500 -
-------------------- --------------------
Total liabilities 1,866,635 27,445
-------------------- --------------------
Equity
Share capital 18 5,213,277 5,207,754
Share premium account 18 14,327,636 7,864,973
Merger relief reserve 18 279,900 -
Warrant reserve 18 157,813 -
Retained earnings 18 (9,387,371) (10,104,200)
--------------------- ---------------------
Total equity 10,591,255 2,968,527
--------------------- ---------------------
TOTAL EQUITY AND LIABILITIES 12,457,890 2,995,972
========== ==========
The financial statements were approved and authorised for issue
by the board of directors on 30 April 2021 and were signed below on
its behalf by
John Taylor
Chairman
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEARED 30 SEPTEMBER 2020
Share Merger
Share Premium Relief Retained Warrant
Capital Account Reserve Earnings Reserve Total
GBP GBP GBP GBP
At 1 October
2018 5,206,954 7,574,273 - (9,372,416) - 3,408,811
Total
comprehensive
expenses for
the
year - (731,784) - (731,784)
Transactions
with
owners
Shares issued 800 299,200 - - - 300,000
Cost of new
issue - (8,500) - - - (8,500)
----------------- ------------------ ------------------ -------------------- -------------------- ------------------
At 1 October
2019 5,207,754 7,864,973 - (10,104,200) - 2,968,527
Total
comprehensive
expense for
the
year - - - 392,329 - 392,329
Share based
payments - - - 324,500 - 324,500
Issue of
warrants - - - - 157,813 157,813
Transactions
with
owners
Shares issued 5,523 6,580,097 279,900 - - 6,865,520
Cost of new
issue - (117,434) - - - (117,434)
----------------- ------------------ ------------------- -------------------- -------------------- ------------------
At 30
September
2020 5,213,277 14,327,636 279,900 (9,387,371) 157,813 10,591,255
========= ========== ========== =========== ========== =========
Share capital
Represents the par value of shares in issue.
Share premium
Represents amounts subscribed for share capital in excess of its
nominal value, net of directly attributable issue costs.
Merger relief reserve
Represents premium on shares issued in connection with the
acquisition of Intrinsic Capital Jersey Limited, recognised in
accordance with S162 of the Companies Act 2006.
Retained earnings
Represents accumulated losses to date.
Warrant reserve
Represents the fair value of placing warrants issued.
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEARED 30 SEPTEMBER 2020
2020 2019
GBP GBP
Operating activities
Profit / (Loss) for the year 392,329 (731,784)
Adjustments for:
(Increase) / decrease in trade
and other receivables (112,776) 17,520
Decrease in trade and other
payables (80,310) (5,249)
Net finance (cost) / income (42,655) 426
Unrealised losses on remeasurement
to fair value 1,364,364 52,930
Impairment of investments - 446,974
Fair value gain on asset acquisition (1,694,436) -
Share based payments 324,500 -
Other income (non-cash transaction) (1,140,000) -
------------------- -------------------
Net cash generated / (used)
in activities (988,984) (219,183)
------------------- -------------------
Investing activities
Payments to acquire investments (2,453,901) (100,000)
Loans advanced (2,722,422) -
Finance income received 941 (426)
------------------- -------------------
Net cash used in investing activities (5,175,382) (100,426)
------------------- -------------------
Financing activities
Net proceeds from issue of shares 6,625,899 291,500
Cash arising on acquisition
of ICJL 5,871 -
------------------ ------------------
Net cash generated from financing
activities 6,631,770 291,500
------------------- -------------------
Net increase / (decrease) in
cash and cash equivalents 467,404 (28,109)
Cash and cash equivalents at
the start of the year 242,415 270,524
------------------ ------------------
Cash and cash equivalents at
the end of the year 709,819 242,415
------------------ ------------------
Cash and cash equivalents consist
of:
Cash and cash equivalents 709,819 242,415
========= =========
The Group had no debt in either period, therefore no net debt
reconciliation has been presented.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARED 30 SEPTEMBER 2020
1. GENERAL INFORMATION
Asimilar Group Plc is a public limited company which is listed
on the Alternative Investment Market (AIM) and incorporated and
domiciled in the UK. The address of its registered office is 4 More
London Riverside, London, SE1 2AU.
2. ACCOUNTING POLICIES
2.1 Basis of preparation
The consolidated financial statements have been prepared in
accordance with EU endorsed International Accounting Standards and
International Financial Reporting Standards (collectively "IFRS")
and the requirements of the Companies Act 2006 applicable to
companies reporting under IFRS.
The consolidated financial statements have been prepared under
the historical cost convention, as modified by the revaluation of
financial assets and financial liabilities (including derivative
instruments) at fair value through profit or loss.
The preparation of financial statements requires the use of
certain critical accounting estimates. It also requires management
to exercise its judgement in the process of applying the group's
accounting policies. The areas involving a higher degree of
judgement or complexity, or areas where assumptions and estimates
are significant to the consolidated financial statements, are
disclosed in Note 3.
2.2 Changes in accounting policies and disclosures
(a) New standards, amendments and interpretations adopted by the
Group
The group has applied the following standards and amendments for
the first time for its annual reporting period commencing 1 October
2019:
-- Prepayment Features with Negative Compensation - Amendments to IFRS 9;
-- Long-term Interests in Associates and Joint Ventures - Amendments to IAS 28;
-- Plan Amendments, Curtailment or Settlement - Amendments to IAS 19;
-- Annual improvements to IFRS Standards 2018-2020 Cycle;
-- Interpretation 23 'Uncertainty over Income Tax Treatments; and
(b) New standards, amendments and interpretations not yet
adopted
A number of new standards and amendments to standards and
interpretations are effective for annual periods beginning after 1
January 2020 and have not been applied in preparing these
consolidated financial statements. None of these is expected to
have a significant effect on the consolidated financial statements
of the Group. There are no other IFRSs or IFRIC interpretations
that are not yet effective that would be expected to have a
material impact on the Company.
2.3 Going Concern
The Group had net assets of GBP10,591,255 as at 30 September
2020 (2019: net assets GBP2,968,527) and generated income after tax
of GBP392,329 (2019 loss after tax: GBP731,784) in the reporting
period.
After taking into account anticipated operational costs,
expected cash outflows and funds arising from the exercise of
warrants as part of a cash flow forecast prepared to June 2022, the
directors are confident that the Group will remain in operational
existence for the foreseeable future and that the going concern
basis of preparation is appropriate to the Group's financial
statements.
2.4 Consolidation
(a) Subsidiaries
Subsidiaries are all entities (including structured entities)
over which the group has control. The group controls an entity when
it is exposed to, or has rights to, variable returns from its
involvement with the entity and has the ability to affect those
returns through its power over the entity. Subsidiaries are fully
consolidated from the date on which control is transferred to the
Group. They are deconsolidated from the date that control
ceases.
The Group considers whether acquisitions meet the criteria of a
business combination in determining whether to apply the criteria
of IFRS 3: Business Combinations. Where such criteria are not met
(as in the case of the acquisition of Intrinsic Capital (Jersey)
Limited during the year), the consideration payable and assets and
liabilities are ascribed a fair value in accordance with IFRS 9:
Financial Instruments and IFRS 13: Fair Value Measurement. The
reasons difference arising on such a transaction are considered and
recognised in accordance with the relevant standard. Differences in
fair value arising from an exchange of financial instruments
conducted on an arm's length basis are recognised as 'Day One gains
or losses' in the income statement.
Acquisition-related costs are recognised as part of the carrying
value of the relevant asset's initially recognised cost.
Contingent consideration is classified either as equity or as a
financial liability. Amounts classified as a financial liability
are subsequently remeasured to fair value, with changes in fair
value recognised in profit or loss.
Inter-company transactions, balances and unrealised gains on
transactions between group companies are eliminated. Unrealised
losses are also eliminated. When necessary, amounts reported by
subsidiaries have been adjusted to conform with the group's
accounting policies.
2.5 Foreign Currency Translation
(a) Functional and Presentation Currency
Items included in the financial statements of each of the
Group's entities are measured using the currency of the primary
economic environment in which the entity operates ("functional
currency").
The consolidated financial statements are presented in Pounds
Sterling (GBP), which is the Company's functional and the Group's
presentation currency.
(b) Transactions and Balances
Foreign currency transactions are translated into the functional
currency using the exchange rates prevailing at the dates of the
transactions or valuation where items are re-measured. Foreign
exchange gains and losses resulting from the settlement of such
transactions and from the translation at year-end exchange rates of
monetary assets and liabilities denominated in foreign currencies
are recognised in the income statement, except when deferred in
other comprehensive income as qualifying cash flow hedges and
qualifying net investment hedges. Foreign exchange gains and losses
that relate to borrowings and cash and cash equivalents are
presented in the income statement within 'finance income or costs'.
All other foreign exchange gains and losses are presented in the
income statement within 'Other (losses)/gains - net'.
Translation differences on non-monetary financial assets and
liabilities such as equities held at fair value through profit or
loss are recognised in profit or loss as part of the fair value
gain or loss.
2.6 Revenue
Revenue is recognised when revenue and associated costs can be
measured reliably and future economic benefits are probable.
Revenue is measured at fair value of consideration received or
receivable for services provided in the normal course of business,
net of discounts, VAT and other sales related taxes.
The company only has one class of business, investment holdings
and management, and therefore no segmental information has been
presented.
2.7 Interest income
Interest income is accrued on a time apportioned basis, by
reference to the principal outstanding and at the effective
interest rate applicable.
2.8 Taxation
The tax expense represents the sum of the current tax expense
and deferred tax expense.
The tax currently payable is based on taxable profit for the
year. Taxable profit differs from accounting profit as reported in
the Statement of Comprehensive Income because it excludes items of
income or expense that are taxable or deductible in other years and
further excludes items that are never taxable or deductible. The
Group's liability to current tax is measured using tax rates that
have been enacted or substantively enacted by the reporting
date.
Deferred tax is the tax expected to be payable or recoverable on
differences between the carrying amounts of assets and liabilities
in the financial statements and the corresponding tax bases used in
the computation of taxable profit and is accounted for using the
balance sheet liability method. Deferred tax liabilities are
generally recognised for all taxable temporary differences and
deferred tax assets are recognised to the extent that it is
probable that future taxable profits will be available against
which deductible temporary differences can be utilised.
Such assets and liabilities are not recognised if the temporary
difference arises from goodwill or if the initial liabilities in a
transaction that affect either the taxable profit or the accounting
profit.
The carrying amount of deferred tax assets is reviewed at each
reporting date and reduced to the extent that it is no longer
probable that sufficient future taxable profits will be available
to allow all or part of the asset to be recovered.
Deferred tax is calculated at the rates that are expected to
apply in the period when the liability is settled or the asset is
realised. Deferred tax is charged or credited in the income
statement, except when it relates to items charged or credited
directly to equity, in which case the deferred tax is also dealt
with in equity.
2.9 Financial assets
(a) Classification
The Group classifies its financial assets in the following
categories: at amortised cost including trade receivables and other
financial assets at amortised cost and at fair value through profit
or loss. The classification depends on the purpose for which the
financial assets were acquired. Management determines the
classification of its financial assets at initial recognition. No
financial assets are held at fair value through OCI.
Trade receivables and other non interest bearing receivables
Trade and other non interest bearing receivables are recognised
initially at the amount of consideration that is unconditional,
unless they contain significant financing components, in which case
they are recognised at fair value. The group holds the trade
receivables with the objective of collecting the contractual cash
flows, and so it measures them subsequently at amortised cost using
the effective interest method.
The Group's accounting policy is to recognise trade receivables
within current assets.
i) Fair values of trade receivables
Due to the short-term nature of the current receivables, their
carrying amount is considered to be the same as their fair
value.
(ii) Impairment and risk exposure
Information about the impairment of trade receivables and the
group's exposure to credit risk, foreign currency risk and interest
rate risk can be found in note 4.
Other financial assets at amortised cost
(i) Classification of financial assets at amortised cost
The group classifies its financial assets at amortised cost only
if both of the following criteria are met:
-- the asset is held within a business model whose objective is
to collect the contractual cash flows; and
-- the contractual terms give rise to cash flows that are solely
payments of principle and interest.
(ii) Other receivables
-- These amounts generally arise from transactions outside the
usual operating activities of the group. Interest could be charged
at commercial rates where the terms of repayment exceed six months.
Collateral is not normally obtained. The non-current other
receivables are due and repayable within three years from the end
of the reporting period.
-- Due to the short-term nature of the other current
receivables, their carrying amount is considered to be the same as
their fair value. For the majority of the non-current receivables,
the fair values are also not significantly different from their
carrying amounts
(iii) Fair values of other financial assets at amortised
cost
-- Note 4 sets out information about the impairment of financial
assets at amortised cost and the group's exposure to credit risk
and foreign currency risk.
Financial Assets at Fair Value Through Profit or Loss
(i) Classification of financial assets at fair value through
profit or loss
The group classifies the following financial assets at fair
value through profit or loss (FVPL):
-- Equity investments for which the entity has not elected to
recognise fair value gains and losses through OCI.
-- Derivative financial assets such as options over counterparty equity instruments.
(ii)Fair value, impairment and risk exposure
Information about the methods and assumptions used in
determining fair value is provided in note 3. For information about
the methods and assumptions used in determining fair value refer to
note 3.
Offsetting Financial Instruments
Financial assets and liabilities are offset and the net amount
reported in the Statement of Financial Position when there is a
legally enforceable right to offset the recognised amounts and
there is an intention to settle on a net basis or realise the asset
and settle the liability simultaneously. The legally enforceable
right must not be contingent on future events and must be
enforceable in the normal course of business and in the event of
default, insolvency or bankruptcy of the company or the
counterparty.
Derivative Financial Instruments that do not qualify for hedge
accounting
Derivatives are initially recognised at fair value on the date a
derivative contract is entered into and are subsequently remeasured
at their fair value.
The Group's derivatives do not qualify for hedge accounting.
Changes in the fair value of any derivative instrument that does
not qualify for hedge accounting are recognised immediately in
profit or loss and are included in other gains/(losses).
Cash and cash equivalents
Cash and cash equivalents include cash in hand, deposits held at
call with banks and other short term deposits with maturities of
three months or less.
Derivative financial liabilities
Derivative financial liabilities constitute warrants over the
parent company's own equity, they are are initially recognised at
fair value on the date a derivative contract is entered into and
are subsequently remeasured at their fair value.
Information about the methods and assumptions used in
determining fair value is provided in note 3.
Trade and other receivables
Trade and other non-interest bearing receivables are initially
recognised at cost and are subsequently measured at amortised cost
using the effective interest method, less provision for impairment.
A provision for impairment of trade receivables is established when
there is objective and probable evidence that it is uncertain if
the amount due can be collected. Movement in the provision charged
or credited in the period is recognised in the income
statement.
The Group discounts some of its trade receivables. The
accounting policy is to continue to recognise the trade receivables
within current assets and to record cash advances as borrowings
within current liabilities.
Trade and other payables
Trade and other payables are not interest bearing and are
initially recognised at cost and are subsequently measured at
amortised cost using the effective interest method.
Equity instruments
Equity instruments issued by the Group are recorded at the
proceeds received, net of direct issue costs.
2.10 Share based payments
The Company issues equity-settled options and warrants to
certain employees and financing parties and these are measured at
fair value at the date of grant by reference to the fair value of
the equity instruments granted. The fair value determined at the
grant date of equity-settled share-based payments is expensed on a
straight-line basis over the vesting period (or immediately if
there is no such period), based on the Company's estimate of the
number of instruments that will eventually vest with a
corresponding adjustment to equity. Fair value is measured by use
of an appropriate option pricing model. The expected life use in
the model has been adjusted based on management's best estimates,
for the effect of non-transferability, exercise restrictions, and
behavioral considerations.
Non-vesting and market vesting conditions are taken into account
when estimating the fair value of the option at grant date. Service
and non-market vesting conditions are taken into account by
adjusting the number of options expected to vest at each reporting
date.
2.11 Earnings per share
Basic earnings per share is calculated by dividing:
-- the profit attributable to owners of the company, excluding
any costs of servicing equity other than ordinary shares;
-- by the weighted average number of ordinary shares outstanding
during the financial year, adjusted for bonus elements in ordinary
shares issued during the year and excluding treasury shares (note
12).
Diluted earnings per share adjusts the figures used in the
determination of basic earnings per share to take into account:
-- the after-income tax effect of interest and other financing
costs associated with dilutive potential ordinary shares; and
-- the weighted average number of additional ordinary shares
that would have been outstanding, assuming the conversion of all
dilutive potential ordinary shares
3. Critical accounting judgements and key sources of estimation
uncertainty
Estimates and judgements are continually evaluated and are based
on historical experience, internal controls, advice from external
experts and other factors, including expectations of future events
that are believed to be reasonable under circumstances. The
following estimates are considered integral to the Group's reported
financial information:
Investment valuation
The Group has a number of level 3 investments whereby their
valuation is determined in whole or in part using valuation
techniques based on assumptions that are not supported by prices
from observable market transactions in the same instrument and not
based on available observable data.
Valuation of Unlisted equity investments
Management determines the fair value of unlisted equity
investments primarily by reference to the prevailing price of
further investment when conducted on an arm's length basis. This is
determined by reference to relevant historical fund raising prices
and relevant post balance sheet events where it can be explicitly
demonstrated that the conditions existed at the Group's balance
sheet date. Management also exercises its own professional
judgement in conducting these desktop valuations. At the balance
sheet date the aggregate fair value of investments valued in this
manner was GBP7,098,593 (see note 14 for further analysis).
Mesh Holdings Plc ("MESH") equity investment
On 3 August 2020 the company acquired 24 million shares in MESH
(8.9% of its share capital). The fair value of the shareholding at
the balance sheet date of GBP1,130,000 was determined through an
external valuation conducted by an independent 3(rd) party. The
valuation was derived by using a net asset valuation basis using
publicly available data and the Directors' assessment of key asset
and liability valuations associated with MESH. This included an
assessment of the fair value of Sentiance N.V., subscription rights
over which were transferred to MESH in exchange for the shares
acquired by the Group. At the date of exchange, the value of an
8.9% holding in MESH was assessed as GBP1,140,000 (see note 6).
Derivative assets - Dev Clever Holdings Plc
The fair value of derivative financial assets at the balance
sheet date of GBP2,920,000 has been determined through a 3(rd)
party actuarial valuation based on an adjusted binomial model based
on the "binomial" or "lattice" option pricing method. The
significant inputs into the model were a weighted average share
price of GBP0.078 at year end date, volatility of 114% , dividend
yield of 0%, the assumption that warrants are subscribed for when
100% in the money, and an annual risk-free interest rate equal to
the yield on zero coupon yield curve of UK gilts at the issue
dates. The volatility measured at the standard deviation of
continuously compounded share returns is based on statistical
analysis of DevClever's daily share prices over the last year.
Derivative liabilities - ICJL consideration warrants
The fair value of derivative liabilities at the balance sheet
date of GBP1,669,500 has been determined through a 3(rd) party
actuarial valuation using a Monte Carlo model that is consistent
with the mathematics underlying the Black-Scholes methodology. The
significant inputs into the model were a weighted average share
price of GBP0.245 at year end date, volatility of 95%, dividend
yield of 0%, the assumption that warrants are subscribed for when
in the money, and an annual risk-free interest rate equal to the
yield on zero coupon yield curve of UK gilts at the issue dates.
The volatility measured at the standard deviation of continuously
compounded share returns is based on statistical analysis of daily
share prices over the last year relevant to the instrument (namely
that of the Group and reference holding, Dev Clever Holdings
Plc).
Valuation of Share based payments
The fair value of share based payments at the grant date of
GBP324,500 has been determined through an actuarial valuation using
an adjusted binomial model. The significant inputs into the model
were a weighted average share price of GBP0.09 at the grant date,
the exercise price shown above, average volatility of 94%, dividend
yield of 0%, the assumption that warrants are subscribed for when
100% in the money, and an annual risk-free interest rate equal to
the yield on zero coupon yield curve of UK gilts at the issue
dates. The volatility measured at the standard deviation of
continuously compounded share returns is based on statistical
analysis of daily share prices over the twelve months prior to
grant.
4. Financial Risk Management
Financial Risk Factors
The Group's activities expose it to a variety of financial
risks: market risk (including currency risk, fair value interest
rate risk, cash flow interest rate risk and price risk), credit
risk and liquidity risk. The Group's overall risk management
programme focuses on the unpredictability of financial markets and
seeks to minimise potential adverse effects on the Group's
financial performance.
Risk management is carried out under policies approved by the
Board of Directors. The Board provides principles for overall risk
management, as well as policies covering specific areas, such as
foreign exchange risk, interest rate risk, credit risk, use of
derivative financial instruments and non-derivative financial
instruments, and investment of excess liquidity.
(i) Derivatives
Derivatives held by the company are for speculative investment
and not for economic hedging purposes. They are classified as 'held
for trading' for accounting purposes and are accounted for at fair
value through profit or loss.
They are presented as current assets or liabilities to the
extent that they are expected to be settled within 12 months after
the end of the reporting period.
information about the derivatives used by the group is provided
in notes 13 and 17.
(ii) Fair value measurement
For information about the methods and assumptions used in
determining the fair value of derivatives, refer to note 3.
(a) Market Risk
(i) Foreign Exchange Risk
The Group has a small exposure to currency risk in relation to
the loan to Sentiance N.V. denominated in euros amounting to
GBP2,771,426 (EUR3,054,000). The directors do not consider the size
of the foreign currency position to be sufficient to warrant
hedging, the balance was subsequently settled in full post year
end. A change of 100 basis points in the Euro to sterling exchange
rate increases or decreases equity and profit or loss by
GBP27,714.
(ii) Price Risk
The Group is exposed to equity securities price risk because of
investments held by the Group, classified on the consolidated
Statement of Financial Position at fair value through profit or
loss. The Group is not exposed to commodity price risk.
Sensitivity analysis
The table below summarises the impact of increases/decreases in
the equity investment portfolio on the Group's post-tax profit for
the year and on total equity. The analysis is based on the
assumption that the equity investments had increased/decreased by
5%, with all other variables held constant. Where option pricing
models with unobservable inputs have been used to derive fair
values, the impact of changes in the most significant input
assumption has been demonstrated.
Level 3 Investments in equity instruments
Impact on post-tax Impact on total
profit equity
2020 2019 2020 2019
GBP'000 GBP'000 GBP'000 GBP'000
Financial assets at fair value
through profit or loss - increase
5% 205,930 159,720 205,930 159,720
Financial assets at fair value
through profit or loss - decrease
5% (205,930) (159,720) (205,930) (159,720)
Impact on post-tax Impact on total
profit equity
Derivative assets - Dev Clever 2020 2019 2020 2019
warrants
GBP'000 GBP'000 GBP'000 GBP'000
Derivative assets at fair value
through profit or loss - increase
10% 180,000 - 180,000 -
Derivative assets at fair value
through profit or loss - decrease
10% (140,000) - (140,000) -
Dev Clever warrants change in
subscription behaviour (default
is to subscribe at 100% in the
money)
Subscribe at 20% in the money (850,000) - (850,000) -
Returns maximisation* 550,000 - 550,000 -
Financial liabilities - consideration
warrants
Financial liabilities at fair
value through profit or loss
- increase volatilities of reference
companies by 10% 225,000 - 225,000 -
Financial liabilities at fair
value through profit or loss
- decrease volatilities of reference
companies by 10% (198,000) - (198,000) -
*Assumes the warrant holder tries to maximise returns in a
financially optimal way, which generally means they will not
exercise until almost the subscription deadline.
Post-tax profit for the year would increase/decrease as a result
of gains/losses on equity securities and derivative financial
instruments classified as at fair value through profit or loss.
(iii) Interest Rate Risk
The Group currently funds its operations through the use of
equity. Cash at bank which is denominated in sterling, is held at
variable rates. At the year end, the Group's financial liabilities
did not suffer interest and thus were not subject to interest rate
risk. It is unlikely that interest rates would decrease by as much
as 1% as they are currently less than 1%. Any decrease in interest
rate to a minimum of 0% would have an insignificant impact on the
interest income received by the Group.
No Cashflow interest rate risk arises from the loan to Sentiance
N.V. of GBP2,771,426 as the loan carries a fixed interest rate, and
the group has no variable interest rate borrowings.
(b) Credit Risk
(i) Risk Management
Credit risk is mitigated by the Group via managing and analysing
the credit risk for each new debtor before terms and conditions are
offered. Credit risk arises from cash and cash equivalents,
derivative financial instruments and deposits with banks and
financial institutions, as well as credit exposures to outstanding
receivables and committed transactions. For banks and financial
institutions, only independently rated parties with a minimum
rating of "A" are accepted.
The Group's debt investment carried at amortised cost of
GBP2,771,426 is subject to the expected credit loss model. As the
loan was repaid in full after the year end (and was expected to be
at the balance sheet date) the Group has assessed the 12 month
expected credit loss provision to be GBPnil.
While cash and cash equivalents are also subject to the
impairment requirements of IFRS 9, the identified impairment loss
was immaterial.
(c) Liquidity Risk
The principal risk to which the Group is exposed is liquidity
risk. The nature of the Group's activities means it finances its
operations through retained earnings and the issue of new shares to
investors. The principal cash requirements are in relation to the
Group's investing policy and meeting working capital requirements.
The Group seeks to manage liquidity through planning, forecasting,
and careful cash management.
Capital Risk Management
The Group's main objective when managing capital is to protect
returns to shareholders by ensuring the Group will continue to
invest and trade profitably in the foreseeable future. The Group
also aims to maximise its capital structure of equity so as to
minimise its cost of capital. The Group expects its current and
projected capital resources to be sufficient to cover its existing
liabilities.
The Group's capital structure is derived solely from the issue
of Ordinary and Deferred Shares.
The Group has not made any changes to its capital management
during the year.
5. ACQUISITION OF SUBSIDIARY
On 30 August 2020 Asimilar acquired Intrinsic Capital (Jersey)
Limited ("ICJL") to allow Asimilar to manage its portfolio with the
benefit of the more benign capital gains tax regime available in
Jersey in respect of some of its current and future
investments.
ICJL was a party to an investment agreement with Dev Clever
Holdings Plc ("Dev Clever"), as announced by Dev Clever on 13 May
2020, giving ICJL a right to subscribe for up to 100,000,000
ordinary shares in Dev Clever at a price of 10 pence per Dev Clever
share (the "Dev Clever Investment Agreement") and, following the
exercise of all of these subscription rights, ICJL would be
entitled to exercise a warrant to subscribe for up to 50,000,000
additional Dev Clever shares at a price of 25 pence per Dev Clever
Share (the "Dev Clever Warrant"). At the date of acquisition ICJL
had exercised part of the option and invested GBP250,000 for
2,500,000 of DevClever shares.
In line with the Group's accounting policies, the acquisition of
ICJL has been accounted for as an exchange of financial assets on
an arm's length basis in accordance with IFRSs 9 and 13, because
ICJL was not considered to meet the criteria of a business at the
acquisition date. The fair value of consideration paid for the ICJL
assets and liabilities is broken down as follows:
GBP
Issue of 1,000,000 Asimilar
ordinary shares at 28p 280,000
9,000,0000 Asimilar share
warrants 2,106,000
Legal fees 11,400
-----------------
. 2,397,400
========
Under the terms of the acquisition agreement of ICJL, the
Company acquired the entire issued share capital of ICJL in return
for the issuance of 1,000,000 new Asimilar ordinary shares credited
as fully paid ("Consideration Shares"). In addition Mark Horrocks,
the sole owner of ICJL, was granted warrants to subscribe for up to
9,000,000 Asimilar ordinary shares in 2 tranches of up to 4,500,000
warrants per tranche. Each tranche will be exercisable for two
years after the relevant price criteria in Dev Clever having been
reached. The relevant price criteria are the mid-market closing
price of Dev Clever Shares for a period of five consecutive
Business Days being or exceeding (i) 28 pence; and (ii) 55 pence
respectively. The warrants expire on 31 August 2030 or 2 years from
date of vesting if earlier. The number of warrants which Mr
Horrocks will be able to exercise, will be proportional to the
number of shares in Dev Clever subscribed for by the Company or
ICJL pursuant to the Dev Clever Investment Agreement at the date of
exercise of such warrants.
The following table summarises the fair value of the
identifiable assets and liabilities assumed of ICJL at the date of
acquisition.
Fair value Fair value Previous
recognised adjustments carrying
on acquisition value
GBP GBP GBP
Book value of assets and
liabilities acquired (85,664) - (85,664)
Dev Clever Options 2,177,500 2,177,500 -
Dev Clever Warrants 2,000,000 2,000,000 -
----------------- ----------------- -----------------
4,091,836 4,177,500 (85,664)
======== ======== ========
The Group performed an exercise to identify the fair value of
assets and liabilities exchanged and as a result of this exercise
the Dev Clever options and warrants held by ICJL were recognised as
derivative financial assets. The fair value of these derivative
assets was determined via an actuarial valuation, the valuation of
these assets is detailed in note 3
A fair value exchange gain has arisen on the acquisition as the
fair value of identifiable assets and liabilities acquired was
higher than the consideration transferred. The Directors have
considered the commercial context of the transaction and have
deemed it appropriate to recognise this gain in the income
statement on the date of the acquisition of ICJL.
GBP
Fair value of assets and
liabilities acquired 4,091,836
Less: Total consideration
transferred (2,397,400)
-----------------
Fair value gain on asset
acquisition . 1,694,436
========
In accordance with IFRS 9, the gain has been recorded as income
in the consolidated statement of comprehensive income. The
directors do not consider the transaction or the revaluation of the
assets held by ICJL to give rise to a current or deferred tax
liability, as the entity not subject to a 0% corporate tax
rate.
6. REVENUE AND OTHER INCOME 2020 2019
GBP GBP
Revenue: Management fees 14,000 14,000
Other income: Gain on sale of investment 1,140,000 -
========= =========
The Company only has one class of business, investment holdings
and management, and therefore no segmental information has been
presented.
Other income relates to the exchange of subscription rights over
shares in Sentiance NV for 8.9% of the share capital of Mesh
Holdings Plc. A fair value of GBP1,140,000 was ascribed to the
exchange at the date of the transaction. No cash or other services
were exchanged as part of the transaction.
7. FINANCE INCOME AND COSTS 2020 2019
GBP GBP
Bank and other interest received 49,945 426
------------------ ------------------
49,945 426
========= =========
Other interest payable 7,318 -
Share based payment (Note 19) 119,500 -
----------------- -----------------
126,818 -
======== ========
8. PROFIT / (LOSS) FOR THE YEAR BEFORE 2020 2019
TAX
GBP GBP
Profit / (Loss) for the year is stated
after charging:
Auditors' remuneration
- audit of the Group and Parent Company's
financial statements 22,200 13,000
- taxation service (2019 only) - 950
- interim financial statement review
services 1,950 1,250
-reporting accountant services 28,500 -
Foreign exchange gains 330,819 -
========= ==========
9. DIRECTORS' EMOLUMENTS 2020 2019
GBP GBP
Aggregate emoluments including
benefits in kind, by director,
are as follows:-
Simon Robinson (resigned 3/12/2019) 35,577 35,000
Sean Nicolson (resigned 3/12/2019) 28,461 24,000
Sohail Bhatti 111,000 54,742
John Taylor 132,000 -
Donald Stewart 112,000 -
------------------ -----------------
Aggregate emoluments 419,038 113,742
========= =========
Warrants granted to directors during the year are disclosed in
the Remuneration Report. These have been accounted for in
accordance with IFRS2 Share based payments. See note 19 for details
of expenditure relating to share based payment transactions
recognised during the year.
Director Grant date Number Exercise Vesting Expiry
price date date
(p)
John Taylor 03/12/2019 2,000,000 10p 03/12/2019 03/12/2022
Donald Stewart 03/12/2019 2,000,000 10p 03/12/2019 03/12/2022
Sohail Bhatti 03/12/2019 1,000,000 10p 03/12/2019 03/12/2022
The number of directors for whom retirement benefits are
accruing under defined contribution schemes was nil (2019: Nil).
The total contributions payable during the year amounted to GBPNil
(2019: GBP Nil).
Warrants held by directors who held office at the relevant
balance sheet date are detailed below:
2020 2019
Number Number
Directors who resigned during the
year
Simon Robinson - exercise price 13p,
expired 31 October 2019 - 980,000
Simon Robinson - exercise price 5p,
expires 31 May 2022 - 2,000,000
Sean Nicolson - exercise price 5p,
expires 31 May 2022 - 1,000,000
----------------------- -----------------------
- 3,980,000
Current directors
Sohail Bhatti - exercise price 5p,
expires 31 May 2022 2,000,000 2,000,000
Sohail Bhatti - exercise price 10p, 1,000,000 -
expires 3 December 2022
John Taylor - exercise price 10p, 2,000,000 -
expires 3 December 2022
Donald Stewart 2,000,000 -
----------------- ---------------
7,000,000 5,980,000
========= =========
10. STAFF COSTS 2020 2019
Number Number
The average monthly number of employees
(including directors)
during the year was
Administration 3 3
======== ========
GBP GBP
Employment costs
Wages and salaries 214,038 104,000
Social security costs 20,872 8,824
Warrants granted (Note 19) 205,000 -
--------------- ---------------
439,910 112,824
========= =========
11. TAXATION 2020 2019
GBP GBP
11(a) Current year tax
UK corporation tax (note 11(b)) - -
======= ========
11(b) Factors affecting the tax charge for the
year
Profit / (Loss) on ordinary activities before
taxation 392,329 (731,784)
--------------- -------------
Profit/(loss) on ordinary activities before
taxation multiplied by the main
rate of UK corporation tax 19% (2019: 19%) 74,542 (139,039)
--------------- -------------
Effects of:
Non deductible expenses in subsidiary 86,623 -
Gain on acquisition of assets and liabilities (321,942) -
of ICJL
Fair value uplift adjustment in subsidiary 238,925 -
Capital gains difference at 19% 201,368 -
Net tax adjustments and transfer (35,001) -
Non deductible expenses (160,428) 97,268
Deferred tax not recognised (84,087) 41,771
--------------- ---------------
Current tax charge - -
========= ========
The Company has unutilised losses carried forward of
GBP1,123,285 (2019: GBP1,700,063). No deferred tax asset has been
recognised relating to these losses as the timing and level of
future profits remains uncertain.
Intrinsic Capital (Jersey) Limited has no tax charge for the
current year and is considered outside the scope of UK corporation
tax.
12. EARNINGS / (LOSS) PER SHARE
The calculations of loss per share are based on the following
losses and number of shares.
2020 2019
Basic Diluted Basic Diluted
Profit / (Loss) for the financial
year 392,329 392,329 (731,784) (731,784)
---------------- ----------------- --------------- --------------
Weighted average number of
shares for
basic and diluted loss per
share 95,478,966 139,211,257 49,355,416 49,355,416
========== ========== ========= ========
IAS 33 requires presentation of diluted EPS when a company could
be called upon to issue shares that would decrease earnings per
share, or increase the loss per share. For a loss-making Company
with outstanding share options, net loss per share would be
decreased by the exercise of options. Therefore for 2019, per
IAS33:36 the antidilutive potential ordinary shares are disregarded
in the calculation of diluted EPS.
13 FINANCIAL ASSETS
(a) Summary of financial assets
2020 2019
GBP GBP
Non-Current
Investments designated at
fair value through profit
or loss (see (b)) 5,771,908 2,684,091
---------------------- ----------------------
5,771,908 2,684,091
Current
Investments designated at 3,022,495 -
fair value through profit
or loss (see movement analysis
in (c))
Financial assets (loans) (see 2,771,425 -
(c)) carried at amortised
cost
Trade receivables carried
at amotised cost (Note 15) 152,750 61,833
---------------------- -----------------
5,946,670 -
=========== ===========
11,718,578 2,745,924
=========== ===========
(b) Analysis of movement of
non-current investments
Financial assets designated
at fair value through profit
or loss
Non - Current
Fair value of investments
brought forward 2,684,091 3,083,995
Purchases during the year 3,381,180 100,000
Net unrealised (loss) in fair
value (520,863) (499,904)
Arising through acquisition
of ICJL:
- Equity investments 227,500 -
---------------------- -------------------
Fair value of investments
carried forward 5,771,908 2,684,091
=========== ===========
(c) Analysis of movement of 2020 2019
current financial assets
GBP GBP
Financial assets designated
as held at fair value through
profit or loss
Current
Fair value of investments - -
brought forward
Purchases during the year 102,495 -
Arising through acquisition
of ICJL:
- Equity investments (Dev 2,000,000 -
Clever options - Note 3)
- Warrants (Dev Clever warrants 2,177,500 -
- Note 3)
- net unrealized (loss) in
fair value (1,257,500)
---------------------- -------------------
Fair value of investments 3,022,495 -
carried forward
=========== ===========
As at 30 September 2020 the fair value of options and warrants
over shares in Dev Clever Holdings Plc was GBP2,920,000 (2019:
GBPnil). See note 3 for valuation details.
Financial assets held at amortised cost
The investment held at amortised cost constitutes an arm's
length interest bearing short term loan of GBP2,771,426 (2019:
GBPnil) at an annual interest rate of 3% that was repaid in full on
30 November 2020.
Details of the investments held are given in the Chairman's
statement
14. FAIR VALUE OF FINANCIAL INSTRUMENTS
IFRS 9 requires the Group to classify financial instruments at
fair value using a fair value hierarchy that reflects
the significance of the inputs used in making the measurement,
the fair value hierarchy has the following levels:
-- quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1);
-- inputs other than quoted prices included within Level 1 that
are observable for the asset or liability, either directly (that
is, as prices) or indirectly (that is, derived from prices) (Level
2);
-- inputs for the asset or liability that are not based on
observable market data (that is, unobservable inputs) (Level
3).
(a) Financial instruments classified as level 1
The fair value of financial instruments traded in active markets
is based on quoted market prices at the end of the reporting
period. A market is regarded as active if quoted prices are readily
and regularly available from an exchange, dealer, broker, industry
group, pricing service or regulatory agency, and those prices
represent actual and regularly occurring market transactions on an
arm's length basis. The quoted market price used for financial
assets held by the Group is the current bid price. These
instruments are included in Level 1. Instruments included in Level
1 comprise equity investments classified as trading securities or
available-for-sale.
(b) Financial instruments classified as level 2
The fair value of financial instruments that are not traded in
an active market (for example, over-the-counter derivatives) is
determined by using valuation techniques. These valuation
techniques maximise the use of observable market data where it is
available and rely as little possible on entity-specific estimates.
If all significant inputs required to fair value an instrument are
observable, the instrument is included in Level 2.
If one or more of the significant inputs is not based on
observable market data, the instrument is included in Level 3.
Specific valuation techniques used to value financial
instruments include:
-- quoted market prices or dealer quotes for similar instruments;
-- the fair value of interest rate swaps is calculated as the
present value of the estimated future cash flows based on
observable yield curves;
-- the fair value of forward foreign exchange contracts is
determined using forward exchange rates at the end of the reporting
period, with the resulting value discounted back to present
value;
-- other techniques, such as discounted cash flow analysis, are
used to determine fair value for the remaining financial
instruments.
The group holds no financial instruments classified as level
2.
(c) Financial instruments classified as level 3
The fair value of financial instruments that are not traded in
an active market (for example, over-the-counter derivatives) and
determined by using valuation techniques. which require significant
adjustment based on unobservable inputs are included in level
3.
The determination of what constitutes observable requires
judgement by the Group. The Group considers observable data to be
market data that is readily available, regularly distributed or
updated, reliable and verifiable, not proprietary, and provided by
independent sources that are actively involved in the relevant
market.
For financial instruments classified as level 3 the Group uses a
combination of internal and external valuations. Where management
determines an external valuation is appropriate the group engages
with professional service providers. Specific valuation techniques
include:
-- Market approach (utilising EBITDA or Revenue multiples,
industry value benchmarks and available market prices
approaches);
-- Net asset approach;
-- Income approach (utilising Discounted Cash Flow, Replacement Cost and Net Asset approaches);
-- Desktop valuations based on price of a recent transaction
when transaction price/cost is considered indicative of fair value;
and
-- Actuarial valuations using Monte Carlo, Black Scholes and adjusted binomial models.
The following table presents the Group's assets that are
measured at fair value at 30 September 2020:
Level 1 Level 3 Total
GBP GBP GBP
Held at fair value
At 1 October 2018 160,045 2,923,950 3,083,995
Additions during the year - 100,000 100,000
Revaluation (52,930) (446,974) (499,904)
---------------------- ---------------------- ----------------------
At 1 October 2019 107,115 2,576,976 2,684,091
Additions during the year 1,792,495 1,691,180 3,483,675
Arising through acquisition
of ICJL:
-equity investments 227,500 - 227,500
-Warrants - 2,000,000 2,000,000
-options - 2,177,500 2,177,500
Revaluation recognised in
statement of comprehensive
income (431,300) (1,347,063) (1,778,363)
------------------ ------------------ -----------------
At 30 September 2020 1,695,810 7,098,593 8,794,403
----------------- ------------------ -----------------
Net book value
At 30 September 2020 1,695,810 7,098,593 8,794,403
=========== =========== ==========
At 30 September 2019 107,115 2,576,976 2,684,091
=========== =========== ===========
The following table presents the Group's financial liabilities
that are measured at fair value at 30 September 2020:
Level 1 Level 3 Total
Held at fair value
At 1 October 2018 and 2019 - - -
Derivatives over own equity
issued in the year - 2,106,000 2,106,000
Fair value adjustment - (436,500) (436,500)
---------------------- ---------------------- ----------------------
At 30 September 2020 - 1,669,500 1,669,500
------------- ------------------ --------------
There were no transfers between levels during the year.
Refer to note 3 for further details of specific level 3
valuations performed during the year.
Refer to note 4 for sensitivity analysis on changes to financial
instruments carried at fair value.
15. TRADE AND OTHER RECEIVABLES 2020 2019
GBP GBP
Trade receivables 15,000 27,600
Prepayments and accrued
income 29,493 7,633
Other receivables 137,750 34,233
--------------- ---------------
182,243 69,466
======== ========
The directors consider the carrying value of trade and other
receivables to equal their fair value. No interest is charged on
receivables.
The directors consider trade receivables held at amortised cost
to have no significant financing element, and the effect of
discounting to be immaterial.
16. TRADE AND OTHER PAYABLES 2020 2019
GBP GBP
Trade payables 57,917 5,877
Accruals and deferred income 135,046 18,420
Other taxes and social
security 4,173 3,148
--------------- ---------------
197,136 27,445
======== ========
The directors consider the carrying value of trade and other
payables to equal their fair value.
17. DERIVATIVE FINANCIAL LIABILITIES 2020 2019
GBP GBP
Derivative liabilities 1,669,500 -
======== ========
On 30 August 2020 as part of the consideration advanced for the
acquisition of ICJL Asimilar Group Plc granted warrants to
subscribe for up to 9,000,000 ASIMILAR ordinary shares in 2
tranches of up to 4,500,000 warrants per tranche. The warrants
represent derivatives over own equity and have been recognised as
derivative financial liabilities.
Refer to note 3 for further details regarding the valuation of
derivative financial liabilities.
Refer to note 4 for sensitivity analysis on changes to financial
liabilities carried at fair value.
The fair value of the warrants on issue as at 30 August 2020 was
GBP2,106,000 (as outlined in note 5). The change in the fair value
of the warrants from GBP2,106,000 to GBP1,669,500 as at 30
September 2020 represents a fair value gain to the Group of
GBP436,500 which has been recognised in the income statement.
The change in fair value primarily arose as a result of
fluctuations in the share prices of referenced equity instruments
within the consideration warrants between the issue ate of 30
August 2020 and 30 September 2020.
18. SHARE CAPITAL 2020 2019
GBP GBP
Issued and fully paid
As at 1 October 2019 5,207,754 5,206,954
Issue of 55,229,167 (2019: 8,000,000)
Ordinary shares of 0.01p each 5,523 800
------------------ ------------------
At 30 September 2020 5,213,277 5,207,754
=========== ===========
The Company has the following classes
of share capital
Ordinary shares 107,361,443 (2019: 52,132,276
of 0.01p) shares of 0.01p each 10,736 5,213
A deferred shares (44,132,276 shares
of 9.99p each) 4,408,815 4,408,815
Deferred shares (8,819,181 shares of
9p each) 793,726 793,726
---------------------- ----------------------
5,213,277 5,207,745
========= =========
Share Premium
As at 1 October 7,864,973 7,574,273
Shares issued during the year (net of
costs) 6,462,663 290,700
------------------ ------------------
At 30 September 14,327,636 7,864,973
========= =========
Share transaction history
During the year ended 30 September 2020 the following share
transactions took place.
On 2 October 2019 the Asimilar Group Plc issued 30,000,000 new
ordinary shares of 0.01p each at 2.50p per share. Each placee also
received one warrant for every two shares subscribed for at an
exercise price of 6.00p exercisable from date of issue to 31
October 2020. As the placing price was at a discount to the
prevailing share price at the date of issue, no value has been
attributed to the bundled warrant.
On 20 January 2020 Asimilar Group Plc issues 11,562,500 new
ordinary shares of 0.01p each at a price of 16.00p per share. Each
place also received one warrant for each share subscribed for at an
exercise price of 30.00p exercisable from date of issue to31 March
2021. The exercise price of the bundled ordinary shares and
warrants was at a premium to the prevailing share price, the
premium amounted to in aggregate GBP57,813, this is considered to
be the intrinsic value of the issued warrants and has been credited
to warrant reserve.
On 21 January 2020 on exercise of a warrant Asimilar Group Plc
issued 1,666,667 shares for 5.00p each.
On 24 January 2020 Asimilar Group Plc issued 10,000,000 new
ordinary shares of 0.01p each at 40.00p per share. Each place also
received one warrant for every share subscribed for at an exercise
price of 130.00p exercisable from date of issue to 31 December
2021. The exercise price of the bundled ordinary shares and
warrants was at a premium to the prevailing share price, the
premium amounted to in aggregate GBP100,000, this is considered to
be the intrinsic value of the issued warrants and has been credited
to warrant reserve.
On 1 September 2020 Asimilar Group Plc issued 1,000,000 new
ordinary shares as part of the consideration of Intrinsic Capital
Jersey Limited at 28p per share. The excess of this issue over the
nominal value of the shares has been recognised within a merger
reserve according to S612 of the Companies Act 2006.
On 22 September 2020 on exercise of a warrant, Asimilar Group
Plc issued 1,000,000 shares for 6.00p each
The ordinary shares have full voting rights, priority dividend
rights and priority in the case of winding up.
The deferred shares of 9.99p each have no voting rights and
shareholders are not entitled to any dividend, and only receive the
nominal amount paid up on their share after there has been a
distributed GBP1,000,000 to the holders of the ordinary shares. The
deferred shares shall not entitle the holders thereof to any
further or other right of participation in the assets of the
Company.
The A deferred shares have no voting rights and shareholders are
not entitled to any dividend, Holders of A deferred shares shall be
entitled to the amount paid up or credited as paid up on the A
deferred shares to be paid out of the assets of the Company
available for distribution among the members, after payment, to the
holders of deferred Shares of the amounts paid up thereon. The
holders of the A deferred shares shall not be entitled to any other
or further right to participate in the assets of the Company.
Warrants
Warrant number Exercise price Vest date Expiry date
pence
As at 1 October
2019
5,890,000 13p 17/11/2016 31/10/2019
2,000,000 5p 05/02/2019 21/02/2022
5,000,000 5p 07/05/2019 31/05/2022
--------------------
12,890,000
Weighted average
price 9 p
Lapsed (5,890,000) 13p 17/11/2016 31/10/2019
Exercised (166,667) 5p 05/02/2019 21/02/2022
(1,500,000) 5p 07/05/2019 31/05/2022
(1,000,000) 6p 10/10/2019 31/10/2020
--------------------
(2,666,667)
Weighted average
price 5p
Issued 17,500,000 6p 01/10/2019 31/10/2020
11,562,000 30p 14/01/2020 31/03/2021
10,000,000 130p 24/01/2020 31/12/2021
--------------------
39,062,000
Weighted average
price 45p
Granted 5,000,000 10p 03/12/2019 31/12/2022
3,500,000 60 06/10/2020 31/12/2020
4,500,000 0.01p 31/08/2020 31/12/2025*
4,500,000 0.01p 31/08/2020 31/12/2025**
--------------------
17,500,000
Weighted average
price 15p
--------------------
60,895,8333
============
As at 30 September 1,833,333 5p 05/02/2019 22/02/2022
2020 3,500,000 5p 07/05/2019 31/05/2022
5,000,000 10p 03/12/2019 31/12/2022
16,500,000 6p 01/10/2019 31/10/2020
11,562,500 30p 14/01/2020 31/03/2021
10,000,000 130p 24/01/2020 31/12/2020
3,500,000 60p 06/10/2020 31/12/2020
9,000,000 0.01 31/08/2020 31/12/2025
--------------------
60,895,833
============
Weighted average
price 33p
* Exercisable in the event mid market price of DevClever
Holdings Plc is or exceeds 28p for at least 5 consecutive business
days
** Exercisable in the event mid market price of DevClever
Holdings Plc is or exceeds 55p for at least 5 consecutive business
days
Of the 60,895,833 outstanding warrants (2019: 12,890,000
warrants), 48,395,833 warrants (2019: 12,890,000) were
exercisable.
Warrants exercised in 2020 resulted in 2,666,667 shares (2019:
Nil shares) being issued at a weighted average price of GBP0.054
each (2019: GBPnil each). The related weighted average share price
at the time of exercise was GBP0.34 (2019: GBPnil) per share. The
related transaction costs, amounting to GBPnil (2019: GBPnil), have
been netted off against the proceeds received.
In addition to warrants bundled with the fresh issue of shares
during private placings, the company entered into the following
transactions where warrants were issued:
On the 1 November 2019 Asimilar Group Plc issued 5,000,000
warrants to company Directors with an exercise price of 10.00p and
a vesting date of 3 December 2019. The fair value at the grant date
of these warrants has been determined through an actuarial
valuation using an adjusted binomial model. The aggregate fair
value of the warrants of GBP205,000 has been expensed as directors
remuneration in accordance with IFRS 2 share based payments and the
Group's accounting policy outlined in note 2.10. These share based
payments are also disclosed in note 19 and the directors
remuneration report.
On 12 March 2020 Asimilar Group Plc issued 3,500,000 warrants
with an exercise price of 60.00p and a vesting date of 1 October
2020 for GBPnil consideration. The warrants were issued as
compensation to potential investors due to cancellation of a
private placing. The fair value of these warrants has been
determined through an actuarial valuation using an adjusted
binomial model. The aggregate fair value of the warrants of
GBP119,500 has been expensed as finance costs.
On 30 August 2020 as part consideration for the acquisition of
ICJL Asimilar Group Plc granted warrants to subscribe for up to
9,000,000 Asimilar ordinary shares in 2 tranches of up to 4,500,000
warrants per tranche. These were granted to Mark Horrocks and have
been disclosed in the Directors remuneration report. The warrants
represent derivatives over own equity and have been recognised as
derivative financial liabilities. At the balance sheet date the
aggregate fair value of these warrants of GBP1,669,500 has been
determined through a 3(rd) party actuarial valuation using a Monte
Carlo model that is consistent with the mathematics underlying the
Black Scholes formula.
Warrant Reserve
2020 2019
GBP GBP
As at 1 October - -
Premium attributable to bundled warrants 157,813 -
issued as part of private placing (warrant
reserve)
------------------ ------------------
At 30 September 157,813 -
=========== ===========
19. SHARE BASED PAYMENTS
On the 1 November 2019 Asimilar Group Plc issued 5,000,000
warrants to company Directors with an exercise price of 10.00p and
a vesting date of 3 December 2019. The fair value at the grant date
of these warrants has been determined through an actuarial
valuation using an adjusted binomial model. The aggregate fair
value of the warrants of GBP205,000 has been expensed as directors
remuneration in accordance with IFRS 2 Share Based payments and the
Group's accounting policy outlined in note 2.10.
On 12 March 2020 Asimilar Group Plc issued 3,500,000 warrants
with an exercise price of 60.00p and a vesting date of 1 October
2020 for nil consideration. The warrants were issued as
compensation to potential investors due to cancellation of a
private placing. The fair value of these warrants has been
determined through an actuarial valuation using an adjusted
binomial model. The aggregate fair value of the warrants of
GBP119,500 has been expensed as finance costs.
The fair value of warrants granted during the period, determined
using the adjusted binomial model, was GBP0.041 per warrant . The
significant inputs into the model were a weighted average share
price of GBP0.09 at the grant date, the exercise price shown above,
volatility of 94% , dividend yield of 0% , the assumption that
warrants are subscribed for when 100% in the money, and an annual
risk-free interest rate equal to the yield on zero coupon yield
curve of UK gilts at the issue dates. The volatility measured at
the standard deviation of continuously compounded share returns is
based on statistical analysis of daily share prices over the last
year.
These share based payments are also disclosed in the directors
remuneration report.
The total value of share based payments recognised as
expenditure during the year was GBP324,500 (2019: GBPNil). This
amount has also been credited to equity in accordance with the
provisions of IFRS 2: Share Based Payments.
20. ULTIMATE CONTROLLING PARTY
The Group is admitted to AIM and there is no individual
controlling party. The Directors' Report provides details of those
shareholders with an individual holding exceeding 3% of issued
share capital.
21. RELATED PARTY DISCLOSURES
Directors' remuneration is shown in Note 9. There were no key
management personnel other than the Directors (2019: none).
On acquisition of Intrinsic Capital (Jersey) Limited had a
liability to Mark Horrocks of GBP319,036. GBP250,000 was paid back
on 9 September 2020. The balance still outstanding at 30 September
2020 was GBP69,036 (2019: GBPnil).
During the year Kepstorn Solicitors provided legal and advisory
service to the Asimilar Group Plc. Donald Stewart is a partner in
the firm. Total of service provided amounted to GBP125,340. (2019:
GBPnil). These were fully paid during the year. There were no
outstanding amounts at the year end.
There were no other transactions falling within the scope of IAS
24 Related Party Disclosures.
22. POST BALANCE SHEET EVENTS
On 20 October 2020 Asimilar Group Plc granted Mark Horrocks
director warrants to subscribe for 1,000,000 new ordinary shares at
30p. The warrants expire on 21 October 2023.
On 28 October Asimilar Group Plc issued 350,000 new ordinary
shares as a result of an exercise of warrants at 5p.
On 30 November 2020 Asimilar Group Plc assigned its Sentiance
Loan of EUR3,000,000 to MESH Holdings Plc and received the full
amount in settlement.
On 7 December 2020 Asimilar Group Plc invested further
GBP298,204 in Magic Media Works Limited by way of Loan Notes of
GBP1.00 each Interest will be paid on the loan notes at 5%, payable
annually in arrears on the anniversary of the loan note
subscription. The loan notes expire on 31 January 2026. Should MMW
not be in a position to satisfy the interest payment in cash it can
elect to satisfy the interest through the issuance of further loan
notes or shares to the loan note holder.
Each loan note has a warrant attached which gives the holder the
right to subscribe for a share in Magic Media Works Limited ("MMW")
at GBP1 per share at any time during the life of the loan note. The
exercise of the warrants can be carried out by offsetting the
exercise subscription due against the outstanding loan amount,
effectively resulting in a cashless exercise. The subscription
forms part of a wider equity and loan note fundraise of up to
GBP13m by MMW which is being led by Sun Capital Partners. The
equity subscription is being carried out at GBP1.00 per share. The
fundraise will be conducted in two rounds: the first at GBP1.00 per
share; and the second, to be conducted in early 2021, at GBP1.10
per share. Asimilar has the right, but not the obligation, to
retain its equity position in the second round of financing.
On 19 January 2021 Asimilar Group Plc issued 400,000 new
ordinary shares as a result of an exercise of warrants at 5p.
On 22 January 2021 Asimilar Group Plc issued 666,667 new
ordinary shares as a result of an exercise of warrants at 5p.
On 23 February 2021 Asimilar Group Plc issued 281,250 new
ordinary shares as a result of an exercise of warrants at 30p.
The Group made the following investments through its 100%
subsidiary Intrinsic Capital Jersey Limited (ICJL):
On 9 November 2020 ICJL invested GBP250,000 in SeeQuestor
Limited for 16,892 ordinary shares
On 1 December ICJL announce the exercise of the tranche 2 of the
DevClever option for 20,000,000 shares at 10p.
On 31 December 2020 ICJL invested a further GBP250,000 in
SeeQuestor Limited for 16,892 ordinary shares. ICJL was also
granted a 1 for 1 warrant to subscribe for further new ordinary
shares in SeeQuestor. These warrants will also apply to the
previous investment of GBP250,000 announced on 9 November 2020. The
warrants are exercisable from the date of grant until 31 December
2021 and will exercise at a discount to the subscription price of
this investment round.
On 26 January the tranche 2 investment in Dev Clever option
announced on 1 December 2020 became unconditional. ICJL now owns
40,000,000 shares in Dev Clver.
On 25 February 2021 ICJL, assigned its right to subscribe for up
to 30 million ordinary shares in Dev Clever at 10 pence per share
("Subscription Rights") to Sitius Limited ("Sitius"). Sitius is an
investment vehicle wholly owned by Dr David von Rosen. The
consideration for the assignment is GBP3 million in cash.
In addition, ICJL transferred a warrant to subscribe for 15
million new ordinary shares of Dev Clever at 25 pence per Dev
Clever share to Sitius for a consideration of GBP500,000 in cash.
ICJL retains a warrant to subscribe for 35 million new ordinary
shares in Dec Clever at 25 pence per Dev Clever Share.
On 17 March Dev Clver published its prospectus, resulting in the
completion of the final investment of GBP3,000,000 via the exercise
of the option to acquire a further 30,000,000 shares. ICJL now hold
70,000,000 shares and 35,000,000 warrants exercisable at 25p.
On 29 March 2021, the Company announced that the mid-market
closing price of shares in Dev Clever had exceeded 28 pence for a
period of five consecutive Business Days. Therefore 70 per cent of
the first tranche of 4,500,000 warrants (equating to 3,150,000
warrants) issued to Mark Horrocks had vested. The 3,150,000
warrants are exercisable at 0.01 pence per Asimilar ordinary share
until 29 March 2023.
2020 2019
Notes GBP GBP
ASSETS
Non-current assets
Investments in financial
assets IV 5,489,308 2,684,091
-------------------- --------------------
5,489,308 2,684,091
-------------------- --------------------
Current assets
Investments in financial
assets IV 102,494 -
Investments in financial
assets held at amortised
cost 2,771,426 -
Receivable from group companies 3,140,000 -
IV /
Trade and other receivables VI 181,528 69,466
Cash and cash equivalents 703,963 242,415
-------------------- --------------------
6,899,411 311,881
-------------------- --------------------
TOTAL ASSETS 12,388,719 2,995,972
========== ==========
EQUITY AND LIABILITIES
Current liabilities
Trade and other payables VII 108,989 27,445
-------------------- --------------------
Derivative financial liabilities VIII 1,669,500 -
-------------------- --------------------
Total liabilities 1,778,489 27,445
-------------------- --------------------
Equity
Share capital IX 5,213,277 5,207,754
Share premium account 14,327,636 7,864,973
Merger relief reserve 279,900 -
Warrant reserve 157,813 -
Retained earnings (9,368,396) (10,104,200)
--------------------- ---------------------
Total equity 10,610,230 2,968,527
--------------------- ---------------------
TOTAL EQUITY AND LIABILITIES 12,388,719 2,995,972
========== ==========
The profit for the parent company for the year was GBP411,304
(2019 - loss GBP731,784)
The financial statements were approved and authorised for issue
by the board of directors on 30 April 20121 and were signed below
on its behalf by
John Taylor
Chairman
COMPANY STATEMENT OF CASH FLOWS
FOR THE YEARED 30 SEPTEMBER 2020
2020 2019
GBP GBP
Operating activities
Profit / (Loss) for the year 411,304 (731,784)
Adjustments for:
(Increase) / decrease in trade
and other receivables (112,061) 17,520
Increase / (decrease) in trade
and other payables 81,579 (5,249)
Net finance(income) / cost (49,004) 426
Derivative fair value movement (436,500) -
Unrealised gains on remeasurement
to fair value 83,365 52,930
Impairment of investments - 446,974
Share based payments 324,500 -
Other income (non-cash transaction) (1,140,000) -
------------------- -------------------
Net cash used in operating activities (836,817) (219,183)
------------------- -------------------
Investing activities
Payments to acquire investments (606,026) (100,000)
Loans made (2,722,422) -
Payments to group companies (2,000,000)
Net finance income 914 (426)
------------------- -------------------
Net cash used in investing activities (5,327,534) (100,426)
------------------- -------------------
Financing activities
Net proceeds from issue of shares 6,625,899 291,500
------------------ ------------------
Net cash generated from financing
activities 6,625,899 291,500
------------------- -------------------
Net increase / (decrease) in
cash and cash equivalents 461,548 (28,109)
Cash and cash equivalents at
the start of the year 242,415 270,524
------------------ ------------------
Cash and cash equivalents at
the end of the year 703,963 242,415
------------------ ------------------
Cash and cash equivalents consist
of:
Cash and cash equivalents 703,963 242,415
========= =========
The Company had no debt in either period, therefore no debt net
reconciliation has been presented.
NOTES FORMING PART OF THE COMPANY FINANCIAL STATEMENTS
FOR THE YEARED 30 SEPTEMBER 2020
I. GENERAL INFORMATION
Asimilar Group Plc is a public limited company which is listed
on the Alternative Investment Market (AIM) and incorporated and
domiciled in the UK. The address of its registered office is 4 More
London Riverside, London, SE1 2AU.
II. ACCOUNTING POLICIES
The separate financial statements of the Company are presented
as required by the Companies Act 2006.
As permitted by the Act the separate financial statements have
been prepared in accordance with International Financial Reporting
Standards as adopted by the European Union. The principal
accounting policies adopted are the same as those set out in note 4
to the consolidated financial statements except as noted below:
Valuation of investments
Investments in subsidiaries are stated at cost less any
provision for impairment in value.
III. INCOME FOR THE FINANCIAL PERIOD
The Company has taken advantage of the exemption allowed under
s408 of the Companies Act 2006 and has not presented its own profit
and loss account in these financial statements. The Company's
Income for the year was GBP411,305 (2019: Loss of GBP731,784).
All staff employed under Asimilar Group Plc and staff numbers
are shown in note 6. Total staff costs total GBP439,910 (2019:
GBP112,824).
IV FINACIAL INSTRUMENTS
2020 2019
GBP GBP
Non-Current
Investments in financial assets
designated at fair value through
profit or loss (see below
for movement analysis) 3,091,908 2,684,091
Investments in subsidiary 2,397,400 -
at cost (note V)
---------------------- ----------------------
5,489,308 2,684,091
Current
Investments designated at 102,494 -
fair value through profit
or loss
Financial assets carried at 2,771,426 -
amortised cost - loans
Financial assets carried at
amortised cost - amounts owed
by group undertakings 3,140,000
Trade receivables carried
at amortised cost 152,035 61,833
---------------------- ----------------------
6,165,955 61,833
=========== ===========
11,655,263 2,745,924
=========== ===========
Financial assets designated
at fair value through profit
or loss
Non - Current
Fair value of investments
brought forward 2,684,091 3,083,995
Purchases during the year 1,611,180 100,000
Net unrealised loss in fair
value (83,363) (499,904)
Disposals (1,140,000) -
Realised gain on disposal 20,000 -
---------------------- -----------------
Fair value of investments
carried forward 3,091,908 2,684,091
=========== ===========
The financial asset held at amortised cost constitutes an arm's
length interest bearing short term loan of GBP2,771,426 (2019:
GBPnil) that was repaid in full shortly after the year end and an
intra group loan of GBP3,140,000.
Details of the investments held are given in the Chairman's
statement.
V. FIXED ASSET INVESTMENTS IN SUBSIDIARY
2020
GBP
Total cost of investment as at 30 2,397,400
September 2020 (additions) _________
On 30 August 2020 Asimilar acquired the entire ordinary share
capital of Intrinsic Capital (Jersey) Limited ("ICJL"). The
consideration paid was a fresh issue of 1,000,000 Asimilar ordinary
shares and warrants to subscribe for up to 9,000,000 ASIMILAR
ordinary shares in 2 tranches of up to 4,500,000 warrants per
tranche. No balance existed prior to 30 August 2020, therefore no
previous movement analysis is presented.
Refer to note 5 for further details regarding the acquired
subsidiary and corresponding treatment in the consolidated
financial statements.
At year end the Company had the following wholly owned
subsidiary:
Intrinsic Capital (Jersey) Limited 100%
Registered Office: 2nd Floor, The Le Gallais Building, 54 Bath
Street, St Helier, Jersey, JE1 1FW, Channel Islands
VI. TRADE AND OTHER RECEIVABLES 2020 2019
GBP GBP
Trade receivables Note IV 15,000 27,600
Prepayments and accrued
income 29,493 7,633
Other receivables Note IV 137,035 34,233
------------------- -----------------
181,528 69,466
Amounts due from subsidiary 3,140,000 -
undertakings
------------------- -----------------
3,321,528 69,466
========= ========
VII. TRADE AND OTHER PAYABLES 2020 2019
GBP GBP
Trade payables 57,915 5,877
Accruals and deferred income 46,901 18,420
Other taxes and social
security 4,173 3,148
--------------- ---------------
108,989 27,445
======== ========
VIII. DERIVATIVE FINANCIAL LIABILITIES 2020 2019
GBP GBP
Derivative liabilities (see note 1,669,500 -
14(c) for movement analysis)
======== ========
On 30 August 2020 as part consideration for the acquisition of
ICJL Asimilar Group Plc granted warrants to subscribe for up to
9,000,000 ASIMILAR ordinary shares in 2 tranches of up to 4,500,000
warrants per tranche. The warrants represent derivatives over own
equity and have been recognised as derivative financial
liabilities.
Refer to note 3 for further details regarding the valuation of
derivative financial liabilities.
Refer to note 4 for sensitivity analysis on changes to financial
liabilities carried at fair value.
The fair value of the warrants on issue as at 30 August 2020 was
GBP2,106,000 (as outlined in note 5). The change in the fair value
of the warrants from GBP2,106,000 to GBP1,669,500 as at 30
September 2020 represents a fair value gain to the Company of
GBP436,500 which has been recognised in the income statement.
IX SHARE CAPITAL
Details of share capital are shown in note 18.
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