TIDMHNG
RNS Number : 5450U
Hawkwing PLC
06 April 2021
6 April 2021
Hawkwing plc
("Hawkwing", or the "Company")
2020 Final Results
Hawkwing plc (LSE: HNG) announces its audited financial results
for the year ended 31 December 2020.
Financial Highlights
-- Operating loss from continuing operations of GBP0.34 million (2019 loss: GBP0.35 million)
-- Loss before tax of GBP0.34 million (2019 loss: GBP0.35 million)
-- Loss per share from continuing operations of GBP0.019 (2019 loss: GBP0.049)
Other Highlights
-- Moved listing from AIM to the Standard Segment of the
Official List ("Standard List") on 30 September 2020
-- Raised GBP1.29 million, before expenses, as part of move to
the Standard List by placing 43,116,659 at 3p a share
-- Completed a 20:1 share consolidation
Keith Sadler, Senior Independent Non-Executive Director,
commented: " During the year, we successfully completed our move to
the Standard List; raising GBP1.29 million, which strengthened the
Company's balance sheet and helped us to pursue our acquisition
strategy.
"Whilst maintaining our commitment to prudent cost control, we
have been actively searching for acquisition targets and continue
to assess a number of potential opportunities. We are targeting
businesses with the prospects of being profitable and cash
generative across various sectors including digital marketing,
medical applications, business and financial services.
"On behalf of the Board, I would like to thank all our
shareholders for their continued support and we look forward to
updating the market on our progress."
This announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014.
Enquiries:
Hawkwing plc
Keith Sadler Senior Independent Non-Executive
Director +44 20 7618 9100
-----------------
Beaumont Cornish (Financial Adviser)
Roland Cornish and James Biddle +44 20 7628 3396
-----------------
Luther Pendragon
Harry Chathli, Alexis Gore +44 20 7618 9100
-----------------
About Hawkwing plc
Hawkwing is a Standard List Cash Shell. It intends to pursue a
reverse takeover transaction, with the aim of delivering
shareholder value. The board intends to seek a business with the
prospects of being profitable and cash generative. For more
information, please visit www.hawkwing.co
STRATEGIC REPORT
2020 Full Year Results
The Company's headline results are set out as follows:
HEADLINE RESULTS Year ended
31 December Year ended
2020 31 December
2019
GBP000 GBP000
Revenue - -
Operating loss (340) (351)
Headline EBITDA(1) (235) (731)
Loss before tax (340) (351)
Loss per share (GBP)(2) (0.019) (0.049)
1. Headline EBITDA is operating loss adjusted to remove the
impact of exceptional income/costs
2. 2019 loss per share has been adjusted to reflect the share
consolidation during the year
BALANCE SHEET
31 December 31 December
2020 2019
GBP000 GBP000
Current assets
Trade and other receivables 43 63
Cash and cash equivalents 1,060 171
Current liabilities
Trade and other payables (32) (93)
Net assets 1,071 141
Principal Activities And Business Review
As a cash shell, the principal activity of the business in the
year has been to identify potential acquisition opportunities.
During the first half of 2020 the Company reviewed its AIM listing
and decided that a listing on the Standard List and trading on the
London Stock Exchange's Main Market would be more appropriate as a
Cash Shell and will increase the Company's ability to identify and
complete an acquisition. The move to the Standard List was
completed on 30 September 2020 and the Company's balance sheet was
strengthened with a fundraising of GBP1.29 million, before
costs.
The Company's strategy is to consider opportunities with an
initial focus on acquiring one or more companies in industries such
as digital marketing, medical applications, business and financial
services and the sports sector. These businesses will provide
specialised, mission-critical technology solutions for specific
industries as opposed to being applicable across different sectors.
The Company's focus is on identifying and acquiring businesses with
the prospects of being profitable and cash generative. Finding a
suitable acquisition has been, and will continue to be, impacted by
COVID-19 restrictions. Nevertheless, the Board continues to review
potential targets and will update shareholders when appropriate.
Whilst an acquisition is being sought, the Board intends to keep
costs to a minimum to preserve cash. The Non-Executive directors
have therefore waived their fees since 1 January 2019.
PRINCIPAL RISKS AND UNCERTAINIES
The management of the Company and the execution of the Company's
strategies are subject to certain risks; however, the Company's
current operations are such that most risks are negligible. The key
business risks are shown below.
Identifying suitable acquisition opportunities
The success of the Company's business strategy is dependent on
its ability to identify sufficient suitable acquisition
opportunities. The Company cannot estimate how long it will take to
identify suitable acquisition opportunities or whether it will be
able to identify any suitable acquisition opportunities at all
within one year after the date of admission. If the Company fails
to complete a proposed acquisition (for example, because it has
been outbid by a competitor) it may be left with substantial
unrecovered transaction costs, potentially including fees, legal
costs, accounting costs, due diligence, or other expenses to allow
it to pursue further opportunities. Furthermore, even if an
agreement is reached relating to a proposed acquisition, the
Company may fail to complete such acquisition for reasons beyond
its control. Any such event will result in a loss to the Company of
the related costs incurred, which could materially adversely affect
subsequent attempts to identify and acquire another target
business. In the event that an acquisition has not been announced
within 12 months of Admission the Board will ask Shareholders t o
approve to continue pursuing an acquisition for a further 12
months
Risk management
The risks that the Company faces have been considered and
policies have been implemented to best deal with each risk. The
most significant risks are set out as follows:
Credit risk
The Company has no trade receivable balances and only minor
other receivables and thus there is no significant current risk of
non-payment.
Liquidity risk
The Company is currently being maintained as a Cash Shell and
the Board intends to complete a reverse takeover as soon as
practicable. During this time, the Board will keep costs to a
minimum in order to preserve cash.
Currency risk
The Company's only current exposure to currency risk is with
regard to amounts held in foreign currency bank accounts. The
non-sterling cash balances at 31 December 2020 were US$130 (2019:
US$12,064).
COVID-19
Trading conditions are likely to remain dynamic amid social and
market uncertainty related to the Covid-19 pandemic and accordingly
it is not possible to quantify with any certainty the impact of the
Covid-19 pandemic on the Company. The Company continues to monitor
the situation however, the full impact of the Covid-19 pandemic on
the Company will depend on a variety of factors including the
length of time the restrictions on social movement are in place and
the extent to which further measures are required. The Company is
of the opinion that the operations and business model of the
Company should be able to accommodate a relatively high degree of
variability.
Key Performance Indicators (" KPI's")
Following the divestment of all its investments in group
undertakings, the Company no longer has any operational businesses
using KPIs. As a result, performance against KPIs is not presented
within these financial statements.
The Company's immediate future performance criteria relate to a
successful future acquisition/reverse takeover.
Environmental policy
The Company is committed to minimising the environmental impact
of the activity of its employees through the application of modern
working practices and to reduce business miles travelled.
Employees
The Company is an Equal Opportunities Employer and no job
applicant or employee receives less favourable treatment on the
grounds of age, sex, marital status, sexual orientation, race,
colour, religion or belief.
It is the policy of the Company that individuals with
disabilities, whether registered or not should receive full and
fair consideration for all job vacancies for which they are
suitable applicants. Employees who become disabled during their
working life will be retained in employment whenever possible and
will be given help with any rehabilitation and retraining.
Corporate and social responsibility
The Board recognises the growing awareness of social,
environmental and ethical matters and it endeavours to take account
of the interest of the Company's stakeholders when operating the
business.
Human rights
Whilst the Company does not have a specific human rights policy,
it takes seriously the responsibility to respect human rights.
Fairness and integrity are an important part of the way the
business is run and employees are encouraged to raise any concerns
in this area to management at the earliest opportunity.
Anti-corruption and anti-bribery
The Company takes seriously the risks of its operations
associated to corruption and fraud. The Company has implemented up
to date internal control procedures to mitigate the risks of
corruption and fraud and the Board acknowledges its responsibility
for maintaining these improved processes.
Engagement with employees
The Company currently does not have any employees (other than
directors) or customers but recognizes that the long-term success
of the business relies on effective engagement with customers and
employees.
Engagement with suppliers
The Company's only suppliers currently are those supplying
professional services. The Company manages relationships with
suppliers as closely as possible to ensure the services provided
meet the Company's high standards.
Engagement with shareholders
The Board recognises the importance of effective communication
with its shareholders. A range of corporate information is
available on the Company's website, and this statement and the
information within the Company's Annual Report provide details to
stakeholders on how the Company is governed. Company performance is
communicated to its shareholders and the market in its results
announcements, with further trading updates made where required and
appropriate.
Events since the year end
There have been no events since the year end.
Section 172 Statement
The Directors set out their statement of compliance with s172
(1) of the Companies Act 2006 which should be read in conjunction
with the rest of the annual report.
The Directors of the Company have a duty to promote the success
of the Company. A director of the Company must act in the way they
consider, in good faith, to promote the success of the Company for
the benefit of its members and in doing so have regards (amongst
other matters) to:
-- The likely consequence of any decision in the long term;
-- The interest of the Company's employees;
-- The need to foster the Company's business relationships with
suppliers, customers and others;
-- The impact of the Company's operations on the community and the environment;
-- The desirability of the Company to maintain a reputation for
highest standards of business conduct; and
-- The need to act fairly between members of the Company.
The Directors are committed to developing and maintaining a
governance framework that is appropriate to the business and
supports effective decision making coupled with robust oversight of
risk and internal controls.
Dividend
The Board is not in a position to propose a final dividend for
the year (2019: GBPnil).
Cash flow and net debt
The Company's cash balance as at 31 December 2020 was GBP1.1
million (2019: GBP0.2 million) and it had no debt as at 31 December
2020.
Approved by the Board of Directors and signed on its behalf
by:
Dwight Mighty
Director
Extracted from directors' responsibilities statement pursuant to
the Disclosure and Transparency Rules
Each of the Directors; being Keith Sadler; Ken Wotton; Ian
Robinson and Dwight Mighty (all Non-Executive) confirm that, to the
best of each person's knowledge:
a. the financial statements, prepared in accordance with the
applicable set of accounting standards, give a true and fair review
of the assets, liabilities, financial position and profit or loss
of the Company; and
b. the Strategic Report contained in the Annual Report includes
a fair review of the development and performance of the business
and the position of the Company, together with a description of the
principal risks and uncertainties that it faces.
The directors are responsible for the maintenance and integrity
of the corporate and financial information included on the Hawkwing
plc website. Legislation in the United Kingdom governing the
preparation and dissemination of financial statements may differ
from legislation in other jurisdictions.
By order of the Board
Keith Sadler
Senior Independent Non-Executive Director
Condensed Income statement
Income Statement
For the year ended 31 December 2020
2020 2019
Note GBP000 GBP000
Administrative expenses (340) (367)
Other income - 16
Operating loss 3 (340) (351)
Headline EBITDA (235) (731)
Exceptional (costs)/income 3 (105) 380
Operating loss
(340) (351)
Loss before taxation (340) (351)
Taxation 4 - 1
Loss for the year (340) (350)
Loss per share from continuing operations:
Basic 2 (0.019) (0.049)
Diluted 2 (0.019) (0.049)
No statement of Comprehensive Income has been produced as all
items pass through the Income Statement
Condensed Balance Sheet
As at 31 December 2020
2020 2019
Note GBP000 GBP000
Current assets
Trade and other receivables 43 63
Cash and cash equivalents 1,060 171
__________ __________
Total current assets 1,103 234
Current liabilities
Trade and other payables (32) (93)
Net assets 1,071 141
========== ==========
Equity
Share capital 5 3,731 2,869
Share premium 30,056 29,648
Merger reserve 251 251
Retained earnings (32,967) (32,627)
Total equity 1,071 141
========== ==========
Condensed Statement of Changes in Equity
For the year ended 31 December 2020 and 2019
Share Capital Share Merger Retained Total
Premium Reserve Earnings
GBP000 GBP000 GBP000 GBP000 GBP000
Balance at 1 January 2019 2,869 29,648 251 (32,277) 491
--------------- ------------- ---------- ----------- --------
Total comprehensive loss
for the year - - - (350) (350)
Balance at 31 December
2019 2,869 29,648 251 (32,627) 141
Issue of share capital 862 408 - - 1,270
Total comprehensive loss
for the year - - - (340) (340)
Balance at 31 December
2020 3,731 30,056 251 (32,967) 1,071
=============== ============= ========== =========== ========
Condensed Statement of Cash Flows
For the year ended 31 December 2020
2020 2019
Note GBP000 GBP000
Net cash flows used in operating activities 6 (338) (468)
Financing activities
Net proceeds on issue of shares 1,227 -
Net increase/(decrease) in cash and cash equivalents 889 (468)
Cash and cash equivalents at beginning of the year 171 639
Cash and cash equivalents at end of the year 1,060 171
Principal accounting polices
General information
Hawkwing PLC (the "Company") is incorporated and domiciled in
the United Kingdom under the Companies Act. The Company is a public
limited company, and the registered office address is: The Walbrook
Building, 25 Walbrook, London, England, EC4N 8AF. The Company's
principal activity is set out as part of the Strategic Report.
The accounting policies set out below have, unless otherwise
stated, been applied consistently to all periods presented in the
financial statements. Judgements made by the Directors in the
application of these accounting policies that have a significant
effect on the financial statements together with estimates with
significant risk of material adjustment in the next year. The
results shown for the year ended 31 December 2020 and 31 December
2019 are audited. The financial information contained in this
announcement does not constitute statutory accounts within the
meaning of Section 434 of the Companies Act 2006. Statutory
accounts of the Company in respect of the financial year ended 31
December 2020 were approved by the Board of directors on 6 April
2021 and will be delivered to the Registrar of Companies in due
course. The report of the auditors on those accounts was
unqualified and did not contain an emphasis of matter paragraph nor
any statement under Section 498 of the Companies Act 2006.
Basis of preparation
The financial statements have been prepared in accordance with
International Accounting Standards in conformity with the
requirements of the Companies Act 2006. The financial statements
have been prepared under the historical cost convention.
Functional, presentational and foreign currency translation
The functional currency of the Company is Pound Sterling, and
the presentational currency of the Company has been changed from US
Dollars to Sterling in 2020. All comparative figures have been
converted to Sterling. This represents a change in the Company's
accounting policy but no amendments, other than retranslation
adjustments, are required to the reported figures as a result of
this change. Transactions in currencies other than the Company's
functional and presentational currency are recorded at the rate of
exchange at the date of the transaction or, if hedged, at the
forward contract rate.
Standards and interpretations not yet applied
The following relevant new standards, amendments to standards
and interpretations have been issued, but are not effective for the
financial year beginning on 1 January 2020 as adopted by the
European Union, and have not been early adopted:
IFRS 17 Insurance Contracts (effective 1 January 2021). The
application of IFRS 17 would have no impact on the financial
reporting of the Company.
Application of new standards in issue
For the preparation of these financial statements, the following
new or amended standards have been adopted for the financial year
beginning 1 January 2020:
Amendments to References to the Conceptual Framework in IFRS
Standards (effective 1 January 2020).
Amendment to IFRS 3 Business Combinations (effective 1 January
2020)
Amendments to IAS 1 and IAS 8: Definition of Material (effective
1 January 2020)
The adoption and implementation of these new or amended
standards have had no impact on the Company's financial
statements.
PRINCIPAL ACCOUNTING POLICIES (cont'd)
Going concern
The Company raised GBP1.29 million, before costs, in September
2020 and has GBP1.06 million in cash on its balance sheet at the
year end. The Company has minimal ongoing costs which reflect the
costs of administrating its listing on the London Stock
Exchange.
Whilst COVID-19 has logistically increased the difficulty in the
Company's ability to complete an acquisition, based on the current
cash availability and predicted expenditure levels, the directors
believe the Company's resources are sufficient to continue
operating throughout the course of this uncertain period. The
Directors have considered the additional risks and uncertainty
caused by the pandemic and taken actions to minimize the impact by
preparing forecasts and projections for the period until April
2022, with prudent assumptions. These forecasts confirm that the
company has the ability to meet its obligations as they fall due.
The Directors will continue, on an ongoing basis, to review the
Company's options including raising additional funding.
1. Segmental analysis
The Company's single reportable segment is that of its
activities as an investment holding company. This activity takes
place wholly in the United Kingdom.
2. Loss per share attributable to ordinary shareholders
2020 2019
per share per share
GBP GBP
Basic loss per share (0.019) (0.049)
Diluted loss per share (0.019) (0.049)
The loss attributable to ordinary shareholders and weighted
average number of ordinary shares for calculating diluted earnings
per ordinary share are identical to those used for basic loss per
ordinary share for the years ended 31 December 2019 and 2020. All
share options formerly in issue had expired.
The calculation of loss per share is based on the following
data:
2020 2019
GBP000 GBP000
Loss for the purposes of basic earnings
per share being net loss attributable
to owners of the Company (340) (350)
Number of Shares
Weighted average number of shares
in issue: 18,127,232 7,171,360
There were no shares with a dilutive, or potentially dilutive,
impact (2019: nil).
3. Operating loss
The following are included in operating loss for the year:
2020 2019
GBP000 GBP000
Exceptional costs/(income) (see
analysis below) 105 (380)
Staff costs 18 421
Auditor's remuneration 33 30
Lease payments 2 3
Foreign exchange losses - 25
The exceptional costs/(income) relate to:
2020 2019
GBP000 GBP000
Costs relating to the move to the LSE
Standard List 105 -
Loan arrangement costs* - 35
Legal and professional costs ** - 184
Exceptional staff costs *** - 216
Reversal of impairment on intercompany
loans **** - (815)
------- -------
Exceptional costs/(income) as above 105 (380)
======= =======
* The arrangement costs represent fees paid by the Company
in respect of the borrowing arrangements of its former
subsidiary undertakings.
** In 2019 were incurred in relation to the disposal of
the Company's subsidiary undertakings.
*** Exceptional staff costs relate to the advance payment
of an employment contract notice period.
**** The impairment reversal on intercompany loans relates
to amounts owed by former subsidiary undertakings written
off prior to disposal.
4. Tax
2020 2019
GBP000 GBP000
Current taxation - (2)
UK corporation tax - -
Adjustments in respect of prior year
------- -------
- (2)
======= =======
Tax charge for the year
The charge for the year can be reconciled to the income
statement as follows:
2020 2019
GBP000 GBP000
Loss before tax (340) (351)
Tax credit at the UK corporation
tax rate of 19% (2019: 19%) (65) (66)
Effects of:
Expenses not deductible for
tax purposes - 42
Non-taxable income - (161)
Losses not recognised in deferred
tax 65 185
Adjustment in respect of prior
years - 2
Tax charge for the year - 2
========== =======
The Company has tax losses carried forward of GBP1,284,693
(2019: GBP944,234) in respect of which no deferred tax asset has
been recognised due to uncertainty of the Company's expected future
profitability.
5. Share capital
The issued share capital of the Company is as follows:
Share Capital Share Capital
Ordinary Deferred
Shares Shares
---------------------------- --------------
GBP000' GBP000's
At 1 January 2019 2,869 -
At 31 December 2019 2,869 -
Sub division and issue of
shares on 29 June 2020 (2,725) 2,725
143 2,725
Ordinary shares issued on
30 September 2020 862
Expenses deducted on issue
of share capital
---------------------------- --------------
Share capital as at 31 December
2020 1,006 2,725
============================ ==============
5. Share capital (continued)
The movement in share capital is set out below.
Number Number
Ordinary Deferred
Shares Shares
------------------------------- ----------------------------
Ordinary shares of GBP0.001
each
At 1 January 2019 143,427,199
At 31 December 2019 143,427,199 -
Issue of shares on 29 June
at GBP0.02 1
Sub division of shares on
29 June 2020 (136,255,840)
into ordinary shares of GBP0.02
Issue of deferred shares
on 29 June 2020 143,427,200
at GBP0.019 per share
7,171,360 143,427,200
Issued during the year
Ordinary share issued on
30 September 2020 43,116,659
------------------------------- ----------------------------
Share capital as at 31 December
2020 50,288,019 143,427,200
=============================== ============================
On the 29 June 2020 the Company completed a 20:1 share
consolidation.
On 30 September 2020 the Company moved to the Standard Segment
of the Official List and raised GBP1.293 million by placing
43,116,659 at 3p per share.
The ordinary shares confer the right to receive a dividend, the
right to one vote per share and the right to participate in a
distribution on a winding up of the Company or a return of
capital.
The deferred shares confer no rights to receive a dividend or
other distribution, no right to participate in income or profit and
no right to receive notice or speak or vote at a general meeting.
They solely confer the right on the return of capital after the
nominal value together with the GBP100,000,000 has been paid to the
ordinary shareholders.
6. Notes of Cash Flow Statement
2020 2019
GBP000 GBP000
Loss for the year (340) (350)
Adjustments for:
Income tax expense - (1)
Expenses paid with the issue of shares 43 -
Operating cash flows before movements
in working capital (297) (351)
Decrease in receivables 20 122
Decrease in payables (61) (239)
Cash used in operating activities (338) (468)
Income taxes - -
Net cash flows used in operating activities (338) (468)
======= =======
6. Notes of Cash Flow Statement (continued)
Cash and cash equivalents comprise cash and short-term bank
deposits with an original maturity of three months or less. The
carrying amount of these assets is approximately equal to their
fair value.
The Company's net cash has moved as follows during the year:
1 January Cash flow Non-cash 31 December
2020 Movements 2020
GBP000 GBP000 GBP000 GBP000
----------- ----------- ----------- -------------
Cash and bank balances 171 889 - 1,060
7. Annual report and accounts
The Company will shortly be publishing its annual report and
accounts including a notice of AGM. These will be made available on
the Company's investor relations website at www.hawkwing.co . The
AGM is to be held at 2-6 Boundary Row, London SE1 8HP at 11 a.m. on
29 April 2021.
COVID-19 arrangements
Further to the UK Government's instructions at the time of
writing, and to minimise public health risks, we strongly recommend
that shareholders do not physically attend the AGM, and instead
follow the voting guidelines below. Further details of the UK
Government's regulations relating to COVID-19 can be found at
www.gov.uk/coronavirus.
The AGM will be convened with the minimum necessary quorum of
two shareholders (which will be facilitated by the Company) and
will be held at 2-6 Boundary Row, London SE1 8HP. This address is
being provided solely for information purposes in order to ensure
that the AGM is properly notified and shareholders are reminded
that they are strongly advised not attend in person.
The board of directors (the "Board") requests that shareholders
vote on the resolutions being put to the AGM by appointing the
Chairman of the AGM as a proxy and giving voting instructions in
advance, either through the CREST system or by using the enclosed
Form of Proxy.
At the meeting itself, voting on all resolutions will be
conducted by way of a poll rather than on a show of hands. The
Company believes that this is the best and fairest way to ensure
that the votes of all shareholders can be taken into account,
whilst also preventing the Company and shareholders potentially
breaching any applicable COVID-19 regulations.
The Board understands that the AGM also serves as a forum for
shareholders to raise questions and comments. Therefore, if
shareholders do have any questions or comments relating to the
business of the meeting that they would like to ask the Board then
they are asked to submit those questions in writing via email to
AGM21@hawkwing.co by no later than 11.00 a.m. on 30 April 2021. The
Board will endeavour to publish answers to any frequently asked
questions on the Company's website as soon as practicable after the
AGM. Only questions from registered shareholders of the Company
will be accepted.
.
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END
FR XQLFBFZLFBBF
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April 06, 2021 09:15 ET (13:15 GMT)
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