TIDMECOB
RNS Number : 5907Q
Eco Buildings Group PLC
19 October 2023
AIM: ECOB 19 October 2023
Eco Buildings Group PLC
("Eco Buildings" or the "Company")
Interim Results for the six months ended 30 June 2023
Eco Buildings Group PLC (AIM: ECOB), announces its unaudited
interim results for the six months ended 30 June 2023 (the "Interim
Results").
As a result of the publication of the Interim Results, the
Company's ordinary shares of 1 pence each will resume trading on
the AIM Market of the London Stock Exchange with effect from 7.30
am on 3 October 2023.
Operational Highlights
-- Acquisition of Eco Buildings Group Ltd completed on the 2
June 2023 following the general meeting held on the 26 May 2023.
The acquisition was classified as a Reverse Takeover under the AIM
rules and as such required approval from shareholders at a General
Meeting.
-- Share reorganisation completed on the 2 June 2023, with the
shares of Fox Marble Holdings Plc. readmitted to AIM under a new
ticker symbol ECOB. Fox Marble Holdings plc name was changed to Eco
Buildings Group Plc.
-- Placing completed raising GBP2.7 million before expenses via
the issue of shares in Eco Buildings Group Plc at 55p per
share.
-- 8,232,857 preference shares issued to holders of record in
Fox Marble Holdings Plc on the 1 June 2023, which will allow them
to participate in the net proceeds arising from a successful
conclusion to the current arbitration case being pursued against
the republic of Kosovo.
-- Factory commission of Eco Buildings Group factory producing
GFRG panelling significantly underway in Durres. The factory is
expected to be fully commissioned during Q4 2023, with commercial
production beginning shortly after.
Financial Highlights
-- The transaction to acquire Eco Buildings Group Ltd has been
accounted for using the acquisition method of accounting in
accordance with IFRS 3, which requires the identification of the
acquirer and the acquiree for accounting purposes. Based on the
assessment of the indicators under IFRS 3 and consideration of all
pertinent facts and circumstances, Eco Buildings' management
determined that Eco Buildings Group Limited (since renamed Eco
Buildings Operations Limited) is the acquirer for accounting
purposes and as such, the merger will be accounted for as a reverse
acquisition. As a result, the financial statements of Eco Buildings
Group Plc in subsequent filings will represent the historical
financial statements of Eco Buildings Group Ltd.
-- Losses for the half year were EUR0.9 million (H1 2022: EUR0.6
million), due to costs incurred as part of the RTO process, offset
by strict measures to control expenditure.
Operational Update
Eco Buildings Group Acquisition and Reverse Takeover
On the 2 June 2023 the Company completed the acquisition of the
entire share capital of Eco Buildings Group Limited, a company that
will operate in the prefabricated modular housing sector.
Eco Buildings Group Ltd had acquired proven and innovative
prefabricated modular technology which has been in development and
commercial use since 2006. Based on this technology, Eco Buildings'
management team has utilised its network, in the Balkans and
initially secured two contracts in Albania that are expected to
generate sales revenue of up to EUR114 million in total for the
first three years following the commissioning of the factory. Eco
Buildings' technology system is not subject to patent protection
and embodies know how and process innovations that have been
developed using its system.
The Directors believe Eco Buildings' range of modular housing
products provide a solution for the construction of both affordable
and high-end housing, with Eco Buildings' products being up to 50%
cheaper, two-thirds lighter and five times faster to build than
conventionally built homes. Eco Buildings' vision is to alleviate
the global housing deficit in a sustainable and profitable way.
The Directors believe that the Company's existing building
products and operations should deliver revenue synergies when
combined with Eco Buildings. These include the supply of processed
dimensional marble from its existing quarries for use within Eco
Buildings' modular housing projects.
The Acquisition constituted a reverse takeover by the Company
under 26 May 2023.
The transaction to acquire Eco Buildings Group Ltd has been
accounted for using the acquisition method of accounting in
accordance with IFRS 3, which requires the identification of the
acquirer and the acquiree for accounting purposes. Based on the
assessment of the indicators under IFRS 3 and consideration of all
pertinent facts and circumstances, Eco Buildings' management
determined that Eco Buildings Group Limited (since renamed Eco
Buildings Operations Limited) is the acquirer for accounting
purposes and as such, the transaction will be accounted for as a
reverse acquisition under IFRS 3. As a result, the financial
statements of Eco Buildings Group Plc in subsequent filings will
represent the historical financial statements of Eco Buildings
Group Ltd.
Share Reorganisation
At close of business on 11 April 2022, the date prior to which
trading in its Existing Ordinary Shares on AIM was suspended, the
Company had 417,333,753 Existing Ordinary Shares which had a
mid-market closing price of 1.085 pence per share.
On the 2 June 2023 each Ordinary Share in the issued share
capital of the Company at the 1 June 2023 was sub-divided into 13
Sub-divided Shares, following which 113,974 Sub-divided Shares were
issued at nominal value. Following the Sub-divided Share Issuance,
every 659 Sub-divided Shares was consolidated into one
Post-Consolidation Ordinary Share and then each Post-Consolidation
Share was sub-divided into one New Ordinary Share with a nominal
value of 1p and one New Deferred Share with a nominal value of
50p.
The New Ordinary Shares have the same rights as the previous
Ordinary Shares including voting, dividend, return of capital and
other rights.
The New Deferred Shares do not have any voting rights and do not
carry any entitlement to attend general meetings of the Company;
nor will they be admitted to AIM or any other market.
The Share Reorganisation resulted in the Company having
8,232,857 New Ordinary Shares and 8,232,857 New Deferred Shares
being in issue immediately following the Share Reorganisation.
Operating Update
Factory
Eco Buildings Group Limited (ECOB) is pleased to confirm that
the recommissioning of the plant and machinery from Dubai at the
new factory in Durres is progressing according to plan.
The main components of the production line have now been
assembled and fixed in place in the factory.
This includes the following which are all assembled and fixed in
place:
-- the main press mould, its framework, its surrounding equipment platforms and gantries;
-- the CNC saw table, the caddy on which the saw travels down
the saw table and the multi-directional CNC saw unit itself;
-- the gypsum powder bulk silo, the weighing hopper it loads
into and the mixer hopper for the slurry which our wall product is
moulded from; and
-- the dust extraction towers and blower motors.
Sales and Marketing
The Group has been successful in securing sales contracts with
the following construction companies:
-- Andrra Invest LLC A Kosovan company specialising in
construction of residential and non-residential projects. Its
activities include project management and development as well as
marketing already finished construction sites. One of the best
known completed projects is Andrra Residence in the capital
Pristina, which is a high rise residential and business building
complex.
-- Egeu Stone LLC A well-recognised construction company in
Albania, which has won 9 public tenders and has completed over 25
diverse construction projects in Albania, including multistorey
residential dwellings, hotels and other commercial and industrial
buildings, schools and public spaces.
Both sales agreements follow the same framework and involve the
targeted production of between 350 and 450 residential units per
year with sizes ranging from 120 square metres to 150 square
metres.
The Company has received details of the first project to be
undertaken under the Andrra Invest contract. The construction of a
model home on site is being completed using existing stock of walls
shipped from the UAE site to the specifications laid out by Andrra,
whilst the commissioning process at the factory is ongoing.
Arbitration Proceedings
On 28 April 2023, the Company entered into a deed of assignment
with Fox Marble SPV, a wholly owned subsidiary of the Company
pursuant to which the net proceeds arising from the Kosovo Dispute
will be paid to Fox Marble SPV. The deed of assignment also
includes an indemnity from Fox Marble SPV to the Company for all
costs and liabilities that may arise in respect of the Kosovo
Dispute. Pursuant to this deed, Fox Marble SPV issued 8,232,857
shares of GBP0.01 each to the Company.
Pursuant to the Bonus Issue, every shareholder of the Company as
at the 1 June 2023 will receive 1 New Preference Share. The New
Preference Shares shall entitle the holders thereof to receive a
preferential dividend equal to the net proceeds of any successful
arbitration. In the event that the Arbitration is not successful,
no amount shall be payable to the holders of the Preference Shares
by the Company.
This announcement contains inside information for the purposes
of Article 7 of EU regulation 596/2014.
For more information on Eco Buildings please visit www.eco-buildingsplc.com or contact:
Eco Buildings Group plc
Sanjay Bowry, Chief Executive Officer
Tel: +44 (0)20 7380 0999
Fiona Hadfield, Finance Director
Tel: +44 (0)20 7380 0999
Spark Advisory Partners Limited (Nominated Adviser)
Matt Davis / James Keeshan
Tel: +44 (0)20 3368 3550
Tavira Securities Limited (Broker)
Oliver Stansfield/Jonathan Evans
+44 (0)203 192 1739
ECO BUILDINGS GROUP PLC
Condensed unaudited consolidated income statement and statement
of comprehensive income
Six months Six months For the
ended 30 ended 30 year ended
Note June June 2022
2023 2023 Unaudited
Unaudited Unaudited
EUR'000s
EUR'000s EUR'000s
------------------------------------ ------- ----------- ----------- ------------
Revenue 32 - -
Cost of Sales (4) - -
----------- ----------- ------------
Gross Profit 28 - -
=========== =========== ============
Administrative and other operating
expenses (132) (63) (242)
Charge on conversion of Pre (749) - -
IPO loan instrument
Operating loss (854) (63) (242)
=========== =========== ============
Net finance (costs)/income 4 (53) (19) (92)
Loss before taxation (907) (82) (334)
=========== =========== ============
Taxation - - -
Loss for the period (907) (82) (334)
=========== =========== ============
Other comprehensive income - - -
Total comprehensive loss
for the period attributable
to owners of the parent company (907) (82) (334)
=========== =========== ============
Loss per share
Basic loss per share 7 EUR0.016 EUR0.0015 EUR0.0061
Diluted loss per share 7 EUR0.016 EUR0.0015 EUR0.0061
ECO BUILDINGS GROUP PLC
Condensed unaudited consolidated statement of financial
position
Notes As at As at 31 As at 30
30 June December June 2022
2023 2022 Unaudited
Unaudited Unaudited
EUR'000s
EUR'000s EUR'000s
---------------------------------- ------ ----------- ----------- -----------
Assets
Non-current assets
Intangible assets 5 4,246 - -
Property, plant and equipment 6 5,639 1,341 906
-----------
Total non-current assets 9,885 1,341 906
=========== =========== ===========
Current assets
Trade and other receivables 2,543 90 187
Inventories 2,392 - -
Cash and cash equivalents 638 10 167
----------- ----------- -----------
Total current assets 5,573 100 354
----------- ----------- -----------
Total assets 15,458 1,441 1,260
=========== =========== ===========
Current liabilities
Trade and other payables 2,447 15
Borrowings 7 - 728 611
----------- ----------- -----------
Total current liabilities 2,447 743 611
=========== =========== ===========
Non-current liabilities
Deferred tax liability 85 - -
Lease Commitments 351 265 -
Borrowings 7 5,430 767 731
----------- ----------- -----------
Total non-current liabilities 5,866 1,032 731
----------- ----------- -----------
Total liabilities 8,313 1,775 1,342
=========== =========== ===========
Net assets/(loss) 7,145 (334) (82)
===========
Equity
Share capital 8 5,772 1 1
Share premium 8 4,446 - -
Retained loss (1,241) (335) (83)
Other reserves (1,832) - -
----------- ----------- -----------
Total equity/(loss) attributable
to owners of the parent
company 7,145 (334) (82)
=========== =========== ===========
ECO BUILDINGS GROUP PLC
Condensed consolidated statement of cash flows
Six months Six months Year
ended ended ended 31
30 June 30 June December
2023 2022 2022
Notes Unaudited Unaudited EUR'000s
EUR'000s EUR'000s
--------------------------------- -------- ----------- ----------- ----------
Cash flows from operating
activities
Loss before taxation (907) (82) (334)
Adjustment for:
Net finance costs/(income) 53 19 92
Operating loss for the period (854) (63) (242)
=========== =========== ==========
Adjustment for:
Amortisation 8 - -
Depreciation 6 128 - 32
Charge on conversion of Pre 794 - -
IPO loan instrument
Changes in working capital: =
Increase in receivables (1,109) (188) (89)
Decrease in inventories 166 - -
Increase in trade and other payables 685 - 14
-----------
Net cash used in operating activities (182) (251) (286)
=========== =========== ==========
Cash flow from investing
activities
Expenditure on property,
plant and equipment 6 (220) (175) (372)
Expenditure on rights of use
assets (41) - (68)
Net cash outflow from investing
activities (261) (175) (439)
=========== =========== ==========
Cash flows from financing
activities
Proceeds from issue of shares 8 1,153 - -
Drawdown or (Repayment) of debt (145) 592 735
Interest paid (37) - -
Net cash inflow from financing
activities 971 592 735
=========== =========== ==========
Net increase/(decrease) in cash
and cash equivalents 528 167 10
Foreign exchange difference arising - -
on translation
Cash and cash equivalents 10 - -
at beginning of
Period
Cash and cash equivalents
at end of period 638 167 10
ECO BUILDINGS GROUP PLC
Condensed consolidated statement of changes in equity
Share Share Share Other Profit Total
capital premium based reserve and loss
payment reserve
reserve
EUR'000s EUR'000s EUR'000s EUR'000s EUR'000s
EUR'000s
-------------------------- ---------- ---------- ---------- ---------- ---------- ----------
As at 1 January
2022 1 - - - - 1
---------- ---------- ---------- ---------- ---------- ----------
Total comprehensive
loss for the period (82) (82)
As at 30 June 2022 1 - - - (82) (81)
========== ========== ========== ========== ========== ==========
Total comprehensive
loss for the period (253) (253)
As at 31 December
2022 1 - - - (335) (334)
-------------------------- ---------- ---------- ---------- ---------- ---------- ----------
Total comprehensive
loss for the period (907) (907)
Transactions with
owners
Share based transactions
RTO transaction 5,772 4,446 - (1,832) - 8,386
As at 30 June 2023 5,773 4,446 - (1,832) (1,242) 7,145
========================== ========== ========== ========== ========== ========== ==========
Notes to the condensed consolidated financial statements for the
period ended 30 June 2023
1) General information
The principal activity of Eco Buildings Group plc and its
subsidiary and associate companies (collectively "Fox Marble Group"
or "Group") is the exploitation of quarry reserves in the Republic
of Kosovo and the Republic of North Macedonia.
Eco Buildings Group plc is the Group's ultimate Parent Company
("the parent company"). It is incorporated in England and Wales and
domiciled in England. The address of its registered office is 160
Camden High Street, London, NW1 0NE. Eco Buildings Group plc shares
are admitted to trading on the London Stock Exchange's AIM
market.
2) Basis of preparation
The results presented in this report are unaudited and they have
been prepared in accordance with the principles of International
Financial Reporting Standards ("IFRS") as adopted by the European
Union that are applicable to the financial statements for the year
ending 31 December 2022.
The accounting policies applied in these results are consistent
with those applied in the Group's Annual Report and Accounts for
the year ended 31 December 2022 and those expected to be applicable
to the financial statements for the year ending 31 D ecember
2023.
This half yearly report does not constitute statutory accounts
within the meaning of Section 434 of the Companies Act 2006.
Statutory accounts for Eco Buildings Group plc for the year ended
31 December 2022 were approved by the Board on 16 October 2023 and
have been filed with the Registrar of Companies. The report of the
auditors on those accounts was unqualified and did not contain a
statement under Section 498 (2) or (3) of the Companies Act 2006.
These condensed interim financial statements for the six months
ended 30 June 2021 have been prepared in accordance IAS 34,
'Interim financial reporting', as adopted by the European Union.
The condensed interim financial statements should be read in
conjunction with the annual financial statements for the year ended
31 December 2022, which have been prepared in accordance with IFRS
as adopted by the European Union. The Annual Report and Accounts
2022 for the Group are available at www.eco-buildingsplc.com
During 2023 the Company completed the acquisition of Eco
Buildings Group Ltd, as described further in Note 9.
The transaction will be accounted for using the acquisition
method of accounting in accordance with IFRS 3, which requires the
identification of the acquirer and the acquiree for accounting
purposes. Based on the assessment of the indicators under IFRS 3
and consideration of all pertinent facts and circumstances, Eco
Buildings' management determined that Eco Buildings Group Limited
(since renamed Eco Buildings Operations Limited) is the acquirer
for accounting purposes and as such, the transaction will be
accounted for as a reverse acquisition.
Consolidated financial statements prepared following a reverse
acquisition are issued under the name of the legal parent
(accounting acquiree - Eco Buildings Group PLC(formerly Fox Marble
Holdings PLC)) but described in the notes as a continuation of the
financial statements of the legal subsidiary (accounting acquirer -
Eco Buildings Operations Ltd (formerly Eco Buildings Group Ltd) ),
with one adjustment, which is to adjust retroactively the
accounting acquirer's legal capital to reflect the legal capital of
the accounting acquiree. That adjustment is required to reflect the
capital of the legal parent. Comparative information presented in
those consolidated financial statements also is retroactively
adjusted to reflect the legal capital of the legal parent.
As a result, the financial statements of Eco Buildings Group Plc
in subsequent filings will represent the historical financial
statements of Eco Buildings Operations Limited.
Because the consolidated financial statements represent the
continuation of the financial statements of Eco Buildings
Operations Limited except for its capital structure, the
consolidated financial statements reflect: (a) the assets and
liabilities of the Eco Buildings Operations Limited (the accounting
acquirer) recognised and measured at their pre-combination carrying
amounts. (b) the assets and liabilities of the Eco Buildings Group
PLC recognised and measured in accordance with this IFRS. (c) the
retained earnings and other equity balances of the Eco Buildings
Operations Limited (accounting acquirer) before the business
combination. (d) the amount recognised as issued equity interests
in the consolidated financial statements determined by adding the
issued equity interest of the legal subsidiary (the accounting
acquirer) outstanding immediately before the business combination
to the fair value of the legal parent, Eco Buildings Group PLC,
(accounting acquiree). However, the equity structure (ie the number
and type of equity interests issued) reflects the equity structure
of the legal parent, Eco Buildings Group PLC, (the accounting
acquiree), including the equity interests the legal parent issued
to effect the combination. Accordingly, the equity structure of the
legal subsidiary, Eco Buildings Operations Limited (the accounting
acquirer) is restated using the exchange ratio established in the
acquisition agreement to reflect the number of shares of the legal
parent (the accounting acquiree) issued in the reverse
acquisition.
3) Going concern
The Directors have reviewed detailed projected cash flow
forecasts and are of the opinion that it is appropriate to prepare
this report on a going concern basis. In making this assessment
they have considered:
a) the current working capital position and operational requirements;
b) the proposed business plan for the combined entity including
commissioning of the new GFRG factory in Albania;
c) the timing and expected start of revenues under the contracts
for construction secured by Eco Buildings with Andrra Invest LLC
and Egeu Stone LLC.
d) the timing of expected sales receipts and completion of other
existing orders, as well as collection of outstanding debtors;
e) the sensitivities of forecast sales figures over the next two years;
f) the timing and magnitude of planned capital expenditure
including expansion of production facilities at the GFRG factory in
Albania; and
g) the level of indebtedness of the company and timing of when
such liabilities may fall due, and accordingly the working capital
position over the next 18 months.
The forecasts assume that the Company will execute a new
business plan for the combined entity, as described in the
strategic report. It further assumes that production at the Fox
Marble factory will continue to operate in good order. The forecast
assumes existing contracts held by the Company will be fulfilled on
a timely basis. Furthermore, the forecasts assume that sales of
block marble will resume as the global effect of the pandemic
recedes. Further the Company is anticipating significant growth in
revenue through the realisation of existing sale contracts and
offtake agreements as well as from newly generated sales.
There are several scenarios which management have considered
that could impact the financial performance of the Company. These
include:
a) The business plan for the combined entity, including planned
capital and strategic expansions could be delayed or result in
further losses for the group;
b) Receipts of outstanding amounts due under the placing
completed in June 2023 could be delayed;
c) Commissioning of the new factory in Albania could be delayed;
levels of production at the factory could be lower than
expected;
d) Levels of production at the quarries can be impacted by
unforeseen delays due to inclement weather or equipment failure;
lower than expected quality of material being produced, and the
continuing effects of the pandemic;
e) Costs of production and construction could be higher than
planned, or there could be unforeseen additional costs;
f) Fulfilment of the Company's order book could be delayed, or
the payment of amounts due under such contracts could be delayed;
and
g) The resumption of block sales to the international block market may be slower than expected.
If the cash receipts from sales are lower than anticipated the
Company has identified that it has available to it several other
contingent actions, that it can take to mitigate the impact of
potential downside scenarios. These include seeking additional
financing, leveraging existing sale agreements, reviewing planned
capital expenditure, reducing overheads and further renegotiation
of the terms on its existing debt obligations.
In conclusion having regard to the existing and future working
capital position and projected sales, the Directors are of the
opinion that the application of the going concern basis is
appropriate.
4) Loss per share
Six months Six months
ended ended Year ended
30 June 30 June 31 December
2023 2022 2022
EUR'000s EUR'000s EUR'000
(1) (2) (2)
---------------------------------- ----------- ----------- -------------
Loss for the period used
for the calculation of basic
LPS (907) (82) (334)
Number of shares
Weighted average number of
ordinary shares for the purpose
of basic LPS 57,132,992 54,545,455 54,545,455
Effect of potentially dilutive - - -
ordinary shares
Weighted average number of
ordinary shares for the purpose
of diluted LPS 57,132,992 54,545,455 54,545,455
Loss per share:
Basic EUR0.016 EUR0.0015 EUR0.0061
Diluted EUR0.016 EUR0.0015 EUR0.0061
Basic earnings per share is calculated by dividing the loss
attributable to owners of the Company by the weighted average
number of ordinary shares in issue during the year.
(1) Pursuant to IAS 33.20 and in conjunction with IAS 33.64 the
share consolidation that occurred in June 2023, as disclosed in
note 29, changes the average number of shares without a concomitant
change in the level of resources. The number of common shares in
issue prior to the share reorganisation in June 2023 is adjusted in
accordance with the change in the number of ordinary shares as if
the share reorganisation had occurred at the beginning of the
period under review.
(2) Earnings per share for the periods ended 30 June 2022 and 31
December 2022 weighted average number of shares of former Eco
Buildings Operations Limited have been adjusted by the exchange
ratio of 1:54,545 to provide comparability in accordance with IFRS
3 - Business Combinations.
5) Intangible assets
Goodwill Mining Capitalised Total
rights exploration
and licences and evaluation
expenditure
--------------------------------- --------- -------------- ---------------- ------
Cost
As at 31 December 2021, 30 June - - - -
2022 and 31 December 2022
Arising on acquisition 1,563 - - 1,563
Acquired 85 2,533 74 2,692
As at 30 June 2023 1,648 2,533 74 4,255
--------- -------------- ---------------- ------
Depreciation
As at 31 December 2021, 30 June - - - -
2022 and 31 December 2022
Charge for the period - 5 3 8
As at 30 June 2023 - 5 3 8
--------- -------------- ---------------- ------
Net book value
--------- -------------- ---------------- ------
As at 30 June 2023 1,648 2,528 71 4,246
========= ============== ================ ======
As at 31 December 2022 - - - -
As at 30 June 2022 - - - -
6) Property, plant and equipment
GFRG Factory Land Marble Rights Quarry Office Total
Plant Factory of use Plant equipment
and machinery Plant assets and machinery and leasehold
and machinery improvements
EUR'000s EUR'000s EUR'000s EUR'000s
EUR'000s EUR.000
--------------- --------------- ---------- --------------- --------- --------------- --------------- ----------
Cost
As at 31
December
2021
Additions 906 - - - - - 906
As at 30
June 2022 906 - - - - - 906
Additions 145 - - 322 - - 467
As at 31
December
2022 1,051 - - 322 - - 1,373
Additions 220 - - - - - 220
Arising on
acquisition - 160 2,881 95 1,069 1 4,206
--------------- ---------- --------------- --------- --------------- --------------- ----------
As at 30
June 2023 1,271 160 2,881 417 1,069 1 5,799
--------------- ---------- --------------- --------- --------------- --------------- ----------
Depreciation
As at 31 - - - - - - -
December
2021 and
30 June 2022
Charge for
the period - - - 32 - - 32
As at 31
December
2022 - - - 32 - - 32
Charge for
the period - - 70 56 2 - 128
As at 30
June 2023 - - 70 88 2 - 161
--------------- ---------- --------------- --------- --------------- --------------- ----------
Net book
value
--------------- ---------- --------------- --------- --------------- --------------- ----------
As at 30
June 2023 1,271 160 2,811 328 1,067 1 5,639
=============== ========== =============== ========= =============== =============== ==========
As at 31
December
2022 1,051 - - 290 - - 1,341
As at 30
June 2022 906 - - - - - 906
7) Borrowings
30 June 31 December 30 June
2023 2022 2022
EUR'000s EUR'000s EUR'000s
------------------------- ---------- ------------ ----------
Current liabilities
Convertible loan note - 728 611
728 611
========== ============ ==========
Non-Current liabilities
Convertible loan note 5,431 767 731
5,431 767 731
========== ============ ==========
On 3 March 2022 the Company entered into an agreement to acquire
operational assets from Gulf Wall FZO, a company registered in
Dubai, United Arab Emirates. The consideration for this purchase
was the issue of shares in Eco Buildings Group Ltd and the issue of
$1,000,000 (GBP759,763) loan note. The terms of the loan note were
agreed on 7 September 2022. The loan note has a four-year term and
an interest rate of 2%. As at 30 June 2023 the loan note held at
amortised cost had a balance of EUR818,272.Between 6 May 2022 and
31 December 2022, Eco Buildings Group Limited issued GBP645,000 of
unsecured convertible loan notes. The loan notes were novated into
Fox Marble Holdings PLC as part of the RTO transaction and were
converted to shares on 50% discount on re-admission of the Eco
Buildings Group Plc. (formerly Fox Marble Holdings PLC) to AIM.
Eco Buildings Group PLC (formerly Fox Marble Holdings PLC held
the following debt at the acquisition date of the 2nd June
2023.
a. Series 11 Loan Note
On 27 May 2020 Eco Buildings Group PLC reached agreement with
the holders of the Series 3, 4, 6, 7, 8, 9 and 10 loan note holders
to reschedule the terms of the loan notes.
The existing loan notes were cancelled and replaced by the
Series 11 Loan Note. The Series 11 Loan Note has an interest rate
of 2% per annum. The Loan note is due for conversion or repayment
on the 1 December 2026 with a conversion price of 5p.
On the 2 June 2023, effective on readmission, the term of the
loan note was varied to change the conversion price to 80p per
share based on the post consolidation share capital of the
Company.
As at 30 June 2023, the Series 11 Loan Note held at amortised
cost had a balance of EUR2,525,616. The Stockholders' option to
convert the loan has been treated as an embedded derivative and
measured at fair value. The fair value has been assessed using a
Black Scholes methodology . The derivative is classified as a level
3 derivative on the basis that the valuation includes one or more
significant inputs not based on observable market data.
The Directors consider that the carrying amount of borrowings
approximates their fair value at 30 June 2023.
b. Gulf Loan Note
As consideration for the acquisition of Gulf Marble Investments
Limited Eco Buildings has issued an Unsecured Convertible Loan Note
('Gulf Loan Note') in the amount of EUR1,785,000. Under the terms
of the Loan Note, the holder may elect to convert at a conversion
price of 130% of the 3-month volume weighted average share price.
The Loan Note was repayable from 1 October 2020. The Loan Note
carries an interest rate of Libor plus 1.5% payable annually in
arrears.
As at 30 June 2023, the Gulf Loan Note held at amortised cost
had a balance of EUR1,939,473. The Stockholders' option to convert
the loan has been treated as an embedded derivative and measured at
fair value. As at 31 30 June 2023, the derivative had a value of
EUR123. The fair value has been assessed using a Black Scholes
methodology . The derivative is classified as a level 3 derivative
on the basis that the valuation includes one or more significant
inputs not based on observable market data.
Subsequent to year end the term of the loan note was varied to
extend the repayment date to 1 January 2025 in return for an
increase in the principal of EUR100,000.
c. Other Borrowings held at amortised cost
In September 2019, the Company entered a short-term borrowing
arrangement with a value of GBP345,000. The interest rate was 1%
per calendar month with a repayment date of the 31 March 2020. On
the 27 May 2020 holders of GBP225,000 of these borrowings agreed to
exchange them with Series 11 Loan notes as described above. The
term of the remaining borrowings amounting to GBP120,000 were
varied to extend the repayment date to 2 June
2023. As at 30 June 2023, these loans had been fully repaid.
8) Share capital
In accordance with IFRS 3 - Business Combinations, as applied to
a reverse acquisition, the share capital in the consolidated
accounts of Eco Buildings Group PLC reflects the share capital of
the legal acquirer, Eco Buildings Group PLC, with the difference
between share capital of the legal acquirer and the accounting
acquirer, Eco Buildings Operations Limited (formerly Eco Buildings
Group Ltd), being aggregated and shown as part of retained earnings
and other reserves.
30 June 31 December Share Share Share premium Share
2023 2022 capital capital 30 June premium
Number Number 30 June 31 December 2023 31 December
2023 2022 2022
EUR'000 EUR'000 EUR'000
EUR'000
--------------- ----------- ------------ --------- ------------- -------------- -------------
Issued, called up and fully paid
Ordinary shares of GBP0.01 each
At start of
the period 54,545,455 54,545,455 1 1 - -
Issued in the
year 15,524,625 - 815 - 4,446 -
At end of the
period 70,070,080 54,545,455 816 1 4,446 -
Issued, called up and fully paid
Preference shares of GBP0.01 each
At start of - - - - - -
the period
Issued in the
year 8,232,857 - 95 - - -
At end of the
period 8,232,857 - 95 - - -
Issued, called up and fully paid
Deferred shares of GBP0.50 each
At start of - - - - - -
the period
Issued in the
year 8,232,857 - 4,861 - - -
At end of the
period 8,232,857 - 4,861 - - -
5,772 1 4,446 -
On the 2 June 2023 each Ordinary Share in the issued share
capital of the Eco Buildings Group PLC at the 1 June 2023 was
sub-divided into 13 Sub-divided Shares, following which 113,974
Sub-divided Shares were issued at nominal value. Following the
Sub-divided Share Issuance, every 659 Sub-divided Shares was
consolidated into one Post-Consolidation Ordinary Share and then
each Post-Consolidation Share was sub-divided into one New Ordinary
Share with a nominal value of 1p and one New Deferred Share with a
nominal value of 50p.
The New Ordinary Shares have the same rights as the previous
Ordinary Shares including voting, dividend, return of capital and
other rights.
The New Deferred Shares do not have any voting rights and do not
carry any entitlement to attend general meetings of the Company;
nor will they be admitted to AIM or any other market.
The Share Reorganisation resulted in the Company having
8,232,857 New Ordinary Shares and 8,232,857 New Deferred Shares
being in issue immediately following the Share Reorganisation.
Issue of Shares
On the 2 June 2023, following the share reorganisation described
above the Company issued in aggregate 61,837,223 new ordinary
shares representing the total of the Placing Shares, the
Consideration Shares and the CLN Shares)
Name Number of ordinary issue price ISSUE Date
share
Placing Shares 4,946,313 55p 2 June 2023
Consideration
shares 54,545,455 55p 2 June 2023
CLN Shares 2,345,455 27.5p 2 June 2023
The Placing shares were issued as part of placing to raise
GBP2.7 million prior to expense at a placing price of 55p.
Consideration shares were issued in settlement of the
consideration price for the acquisition of Eco Buildings Group Ltd
.
CLN Shares were issued as settlement of the Convertible Loan
Notes totalling GBP645,000 novated into the Company as part of the
Acquisition of Eco Buildings Group Limited as noted above
9) Acquisition of Eco Buildings Group Limited
On 28 April 2023, the Company entered into an acquisition
agreement pursuant to which it agreed to purchase the entire issued
share capital of Eco Buildings in exchange for shares in the
Company. The aggregate total consideration to be paid by the
Company for the shares in Eco Buildings is to be satisfied at by
the issue of 54,545,455 Shares in the enlarged group.
On the 2 June 2023 the Company completed the acquisition of 100%
of the issued share capital of Eco Buildings Group Ltd.
The Acquisition constituted a reverse takeover by the Company
under the AIM Rules and was, therefore, subject to the approval of
Shareholders at the General Meeting.
% Ownership Date acquired/ Registered Place Principal
Incorporated Office of incorporation activity
Eco Buildings 100% 3 August 160 Camden England Operating
Group Limited 2012 High Street & Wales Company
NW1 0NE
Eco Buildings 100% 11 December Rruga "Frosina Albania Operating
Group Albania 2012 Plaku", pall. Company
Sh.P.K 21,
hyrja 13,
Kati 1, Tirana
The transaction has been accounted for using the acquisition
method of accounting in accordance with IFRS 3, which requires the
identification of the acquirer and the acquiree for accounting
purposes. Based on the assessment of the indicators under IFRS 3
and consideration of all pertinent facts and circumstances, Eco
Buildings' management determined that Eco Buildings Group Limited
(since renamed Eco Buildings Operations Limited) is the acquirer
for accounting purposes and as such, the merger will be accounted
for as a reverse acquisition. As a result, the financial statements
of Eco Buildings Group Plc in subsequent filings will represent the
historical financial statements of Eco Buildings Operations
Limited.
The IFRS 3 acquisition method of accounting applies the fair
value concepts defined in IFRS 13 - Fair Value Measurement ("IFRS
13") and requires, among other things, the assets acquired and the
liabilities assumed in a business combination to be recognized by
the acquirer at their fair values as of the acquisition date, with
certain exceptions. As a result, the acquisition method of
accounting has been applied and the assets and liabilities of Eco
Buildings Group PLC (formerly Fox Marble Holdings PLC) have been
recorded at their respective fair values, with limited exceptions
as permitted by IFRS 3.
Computation of consideration
Eco Buildings Group Ltd shareholders received 54,545 Eco
Buildings Group plc (formerly Fox Marble Holdings PLC) ordinary
shares for each Eco Buildings Operations Ltd (formally Eco
Buildings Group PLC) ordinary share held immediately prior to the
acquisition as consideration in connection with the merger, which
represented 54,545,455 shares. However, as required by IFRS 3, the
consideration transferred is calculated as if Eco Buildings
Operations Limited, as the accounting acquirer, issued shares to
the shareholders of the accounting acquiree, Eco Buildings Group
plc. The value of the consideration transferred has been measured
based on the issue price shares of 55 pence per share on 2 June
2023. The number of Eco Buildings Operations Limited shares that
Eco Buildings Operations Limited is deemed to issue to Eco
Buildings Group Plc shareholders under reverse acquisition
accounting provides the former Eco Buildings Group Plc shareholders
with the same ownership in the combined group as obtained in the
acquisition.
Provisional
fair value
EUR'000
--------------------------------------------------- ------------
Fair value of consideration issued
Deemed consideration 5,262
5,262
The assets and liabilities recognised as a result Provisional
of the acquisition are as follows: fair value
EUR
----------------------------------------------------- ------------
Net assets acquired 3,699
Goodwill arising on acquisition 1,563
The excess of the consideration transferred over the fair value
of Eco Buildings Group PLC's assets acquired and liabilities
assumed has been recorded as goodwill. Eco Building Operations
Limited (formerly Eco Buildings Group Limited) 's assets and
liabilities together with its operations will continue to be
recorded at their pre-acquisition historical carrying values for
all periods presented in the consolidated financial statements of
Eco Buildings Group PLC. Following the completion of the
transaction, the earnings of the combined group reflect the impacts
of purchase accounting adjustments, including changes in
amortization and depreciation expense for acquired assets.
As permitted by IFRS 3 Business Combinations, the business
combination is accounted for using provisional amounts. Any
adjustments to the provisional amounts will be made within the
measurement period to reflect new information obtained about fact
and circumstances that were in existence at the acquisition date.
The measurement period cannot exceed one year from the acquisition
date.
The acquired business contributed a net loss of EUR816 to the
group for the period from 2 June 2023 to 30 June 2023. If the
business had been acquired at 1 January 2023 the impact on revenue
would be EUR143k and the net loss would have been EUR105k.
The Interim Results for the six months ended 30 June 2023 are
available at www.eco-buildingsplc.com
Caution regarding forward looking statements
Certain statements in this announcement, are, or may be deemed
to be, forward looking statements. Forward looking statements are
identi ed by their use of terms and phrases such as "believe",
"could", "should" "envisage", "estimate", "intend", "may", "plan",
"potentially", "expect", "will" or the negative of those,
variations or comparable expressions, including references to
assumptions. These forward-looking statements are not based on
historical facts but rather on the Directors' current expectations
and assumptions regarding the Company's future growth, results of
operations, performance, future capital and other expenditures
(including the amount, nature and sources of funding thereof),
competitive advantages, business prospects and opportunities. Such
forward looking statements re ect the Directors' current beliefs
and assumptions and are based on information currently available to
the Directors
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END
IR DVLFFXBLZFBF
(END) Dow Jones Newswires
October 19, 2023 02:00 ET (06:00 GMT)
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