TIDMKOOV
RNS Number : 7168Z
Koovs PLC
19 December 2017
19 December 2017
Interim Results for the six months ended 30 September 2017
Koovs plc ("Koovs" or the "Company")
Focus on high quality sales delivering continued margin
improvement
Koovs plc (AIM: KOOV), ("Koovs" or the "Company") the
fashion-forward business focused on the young Indian e-commerce
market, today announces its interim results for the six months to
30 September 2017.
Business Highlights
-- Gross Sales* at GBP7.9m for the period (H1 FY17: GBP7.9m); in
line with India's ecommerce market which was flat, impacted by
Demonetisation, the introduction of the Goods and Services Tax, and
heavy discounting and marketing expenditure by sector peers
-- Quality of sales improved with markdown sales reduced to 20%
of Sales (H1 FY17: 29%) in a market driven by high discounting
-- Trading Margin increased significantly to 18% (H1 FY17: 2%)
-- Average Order Value increased by 21% GBP17.00 (H1 FY17: GBP14.70)
-- Brand awareness increased to 21% (March 2017: 15%)
-- Sales and increase in brand awareness with significantly reduced marketing spend
-- International distribution agreements with Souq.com in Middle East and Simply Be in UK
-- Recent Forrester survey for customer experience ranked
KOOVS.COM No.1 for "Best Customer Experience" among online-only
retailers in India
-- Social media presence grew by 29% to 2.2 million followers (H1 FY17: 1.7m)
Financial Overview
-- Group Revenues at GBP3.9m for the period (H1 FY17: GBP4.0m)
-- Group gross margin improved from -20% to 0% (H1 FY17: -20%)
-- Operating costs reduced by 9% to GBP7.7m (H1 FY17: GBP8.4m)
-- Loss for the period reduced by 15% to GBP7.8m (H1 FY17: GBP9.1m)
-- Cash utilised in the period reduced by 44% to GBP6.8m (H1
FY17: GBP12.2m - included a GBP3.2m media prepayment)
-- Funding of GBP8.9m received in the period through the issuance of 6% convertible loan notes
* Gross Sales (Gross Order Value) order value placed through the
KOOVS.COM website including taxes
Trading Update & Outlook
With modest additional marketing spend, the important month of
November delivered a significant year on year improvement across
key metrics, with Sales up by 17% to GBP1.7m and website traffic up
43%. However, marketing expenditure is currently significantly down
due to the ongoing funding requirements of the Group, which the
Company expects to affect FY18 sales overall. Additional marketing
expenditure is conditional upon the timing of closure of the
funding programme announced in July 2017, which the Company
continues to expect to close shortly.
Koovs remains well placed to maximise the future growth of the
Indian ecommerce market and expects the market to return to growth
in the next financial year.
Mary Turner, CEO, said:
"I am pleased with the progress we have made in our business
fundamentals. Year on year Trading Margin has been improved from 2%
to 18% and Brand Awareness is up from 15% to 21%. In addition,
Koovs is now ranked No1 for customer experience by Forrester
Research and has the highest Net Promotor Score in the fashion
vertical (RedSeer) ahead of Amazon and Flipkart.
"It has been a challenging year generally for the market,
however with these strong business fundamentals, Koovs is well
positioned to capitalise further on the growth opportunity."
Definitions
Sales (Gross order value): Total value of orders placed by
consumers on the KOOVS.COM website for products supplied by the
Group.
Performance marketing: Pay per click marketing e.g. Google, Facebook
Trading margin: Implied retail gross margin that would be
reported in the companies accounts if Koovs India were able to ship
products directly to the end consumer
Notes:
Gross Order Value is the value of the orders placed on
KOOVS.COM. Group Revenues are after returns, tax and the discount
paid to Marble E-Retail Pvt Ltd. to cover delivery, warehousing and
customer care. Marble is used by Koovs in compliance with India's
foreign direct investment rules to deliver and provide customer
support for the goods purchased on KOOVS.COM.
Sterling equivalent of Indian Rupee values at exchange rates
ruling in the relevant period or on the relevant date.
The information presented in this report has not been audited by
the Company's auditors.
Notes to Editors
The Company is headquartered in London, where the majority of
its design and buying team is based, with all other operational
functions based in India.
For further information,
please contact:
Koovs plc Tel: +44 (0) 20 7151
Mary Turner/Rob Pursell 0170
Peel Hunt LLP
Dan Webster / George Tel: +44 (0) 20 7418
Sellar / 8900
Jock Maxwell Macdonald
(ECM)
Media Enquiries - Headland
Lucy Legh / Rob Walker Tel: +44 (0) 20 3805
/ Charlie Twigg 4822
The information contained within this announcement is deemed by
the Group to constitute inside information as stipulated under the
Market Abuse Regulations (EU) No. 596/2014 ("MAR"). Upon the
publication of this announcement via a Regulatory Information
Service ("RIS"), this inside information is now considered to be in
the public domain.
CHAIRMAN'S STATEMENT FOR THE SIX MONTHS TO 30 SEPTEMBER 2017
Koovs occupies a market leading position within India's
e-commerce market, which is forecast to grow five-fold to $3.5
billion over the next few years.
While the short-term disruption created by demonetisation and
the introduction of India's Goods and Services Tax caused the
Indian online fashion market to remain flat in the current
financial year, I am more excited than ever about the company's
long-term growth prospects.
Koovs is in the right place at the right time, underlined by the
fundamental demographic and macroeconomic progress India will make
over the coming years and the remarkable digital transformation it
is undergoing.
In the six months to 30 September 2017 we have continued to
build on the key strengths of the business in its brand, products
and customer service. It is a credit to the team that in a flat
market with high levels of discounting we have been able to
increase our brand awareness and customer satisfaction at the same
time as substantially increasing our margins.
Koovs remains well placed to maximise the future growth of the
Indian ecommerce market and deliver its strategic objectives set
out in the Annual report dated March 2017.
Fund raising
During the period GBP8.9m out of a total possible GBP18.9m of
convertible loan notes has been raised as part of the funding
programme announced in July 2017.
The Company remains in advanced negotiations and expects to
announce the successful conclusion of this additional funding in
due course.
Outlook
We expect the market to return to growth in the next financial
year. As such we intend to remain resolutely focused on our
strategy in order to capitalise on the opportunity represented by
the ecommerce market in India.
Waheed Alli
Chairman
19 December 2017
INTERIM REVIEW
Strategy
Koovs' commercial strategy and goal to become India's number one
international fashion destination is aimed at rapidly building
scale in the business. We will do this by following the strategic
objectives detailed in the latest annual report for the year to
March 2017 and listed below.
Ø Expand product range
Ø Engage customer though content
Ø Amplify the brand
Ø Extend territories
We will provide the most engaging customer experience through
fashion and lifestyle related content and develop a seamless
experience across web, mobile and tablet.
Further, we will become the undisputed brand for affordable
international style for the fashion lover in India by amplifying
our voice to become "famous for fashion" through extensive and
targeted marketing campaigns across multiple channels in India's
major cities.
Trading performance [and KPIs]
Sales generated on the KOOVS.COM website during the six months
to 30 September 2017 were in line with H1 FY17 at GBP7.9m (INR
651.7m). An improved product offering with more efficient buying
has increased full price and promotional sales by 11% to GBP6.3m
(INR 522.2m), and reduced markdown sales by 31% to GBP1.6m (INR
129.5m).
With more focus on profitable sales the trading margin (for
sales generated on Koovs.com) for the six months to 30 September
2017 was 18.4%, an increase from 1.6% in H1 FY16. Allowing for the
discount on wholesale sales to Marble, to cover delivery and
warehousing costs, the gross margin for the Group for the six
months to 30 September 2017 was -0.3%, a significant improvement
from -20.1% in H1 FY16
Marketing activities in the period delivered strong results:
-- With a limited increase in costs (GBP0.3m) brand marketing
programs lifted Koovs' brand awareness from 13% at the end of last
financial year to 21% by 30 September 2017.
-- Performance marketing (pay per click) efficiency also
improved. With improved bidding strategies, and supported by the
increased brand awareness, average cost per order reduced by
36%.
Other costs in the period were in line with last year. During
the six months to 30 September 2017 a number of cost saving
initiatives were introduced. Key amongst these were the full
outsourcing of warehouse operations as well as a restructuring
which reduced staff numbers by 21%. The full financial impact of
these initiatives will be seen in the second half of the year.
Customer satisfaction has continued to improve with two surveys
published in November showing Koovs has the highest customer
satisfaction ratings in the online fashion sector. A widely
reported survey by Forrester had Koovs rated higher than all
competitors including Amazon and Flipkart. This was also
corroborated by a separate survey conducted by Redseer consulting
on behalf of the Company.
Over the period, compared with the previous period, we have
achieved the following:
H1 FY18 H1 FY17 %
------------------ -------- -------- -----
Visits to
Koovs.com
site 32.1m 38.0m -15%
------------------ -------- -------- -----
Active customers 446,000 431,000 +4%
------------------ -------- -------- -----
Social Followers 2.2m 1.7m +29%
------------------ -------- -------- -----
Financial results, cash flow and funds
Revenue in the period, representing the wholesale price of
products sold was GBP3.94m / INR 328.7m (Six months to 30 September
2016: GBP3.99m / INR 366.7m). Gross loss in the period was
GBP0.012m / INR 1.1m (Six months to September 2016: GBP0.80m / INR
73.7m). Gross loss % in the period was -0.3% (Six months to
September 2016 -20.1%).
After cost of sales and overhead costs, the net loss before tax
in the period was in line with expectations at GBP7.77m / INR
647.4m (Six months to 30 September 2016: GBP9.09m / INR 835.2m).
The reduction in net loss resulted from the improvement in gross
loss together with reduced operating expenses due to increased
efficiencies in marketing spend.
At 1 April 2017, including both short- and long-term deposits,
the business had access to GBP7.47m / INR 606.0m (2016: GBP2.54m /
INR 241.5m) for the purposes of funding the business.
During the period, GBP6.77m / INR 564.4m (Six months to 30
September 2016: GBP12.16m / INR 1,118.2m) was utilised in funding
losses and additional working capital. GBP8.90m (GBP9.3m in
cashflow due to movement in exchange rates) / INR 779.6m of
additional funds was raised in the period through the issuance of
convertible loan notes.
At 30 September 2017, including both short- and long-term
deposits, the business had access to INR 802.9m / GBP9.16m (30
September 2016: INR 667.9m /GBP7.74m) for the purposes of funding
the business. The funds are held in term deposits or current
accounts, mainly in India. Additionally, GBP5.90m (INR 516.8m) of
marketing funds have been prepaid to secure significantly reduced
media rates, and been recorded in the Statement of Financial
Position under "Trade receivables, other receivables, prepayments
and other assets".
Principal risks and uncertainties
The Company's business activities, together with the factors
likely to affect its future development, financial position,
financial risk management objectives, details of its financial
instruments and its exposures to price, credit, liquidity and cash
flow risk are described in the Chairman's Statement and the
Strategic Report published in the annual report for the period
ended 31 March 2017.
The board considers the principal risks and uncertainties facing
the Group to be unchanged from those set out in the Annual Report
and Accounts for the period ended 31 March 2017, summarised as
follows:
-- Funding risk, including the ability of the Board to secure
the funding required to implement its plans - see note 1.2
below;
-- Market and economic risks, including the economic climate and competition in India;
-- Financial risks, including interest rate and currency risk;
-- Technological risk;
-- Warehouse disruption; and
-- Reliance on key personnel.
These are set out in detail in the Group's Annual Report and
Accounts for the period ended 31 March 2017, a copy of which is
available on the Group's website.
Capital Raising
In July 2017 the Board announced its intention to raise up to
GBP18.9m in convertible loan notes. As at the date of this report
GBP8.9m has been raised (Note 7) and the Company remains in
advanced negotiations and expects to announce the successful
conclusion of additional funding in due course.
On behalf of the board of directors
Mary Turner Robert Pursell
Director Director
19 December 2017 19 December 2017
Consolidated Income Statement
for the six month period to 30 September 2017
MEMORANDUM
Notes 1 April 1 April 1 April
2017 to 2016 to 2017 to 1 April
30 Sept 30 Sept 30 Sept 2016 to
2017 2016 2017 30 Sept
Unaudited Unaudited 2016
INR million INR million GBP000 GBP000
Revenue 3 328.7 366.7 3,944 3,989
Cost of sales (329.8) (440.4) (3,956) (4,791)
----------- ----------- -------- --------
Gross loss (1.1) (73.7) (12) (802)
Operating
expenses (638.8) (776.7) (7,664) (8,449)
Operating
loss (639.9) (850.4) (7,676) (9,251)
Finance income 9.2 19.1 110 208
Finance expense (16.7) (3.9) (200) (42)
Loss for
the period
before tax (647.4) (835.2) (7,767) (9,085)
Tax expense 4 - - - -
Loss for
the period (647.4) (835.2) (7,767) (9,085)
----------- ----------- -------- --------
Loss attributable
to:
Equity holders
of the Company (647.4) (806.4) (7,767) (8,772)
Non-controlling
interests - (28.8) - (313)
----------- ----------- -------- --------
Loss for
the period (647.4) (835.2) (7,767) (9,085)
----------- ----------- -------- --------
Loss per
share
Basic and
diluted 5 INR(3.7) INR(5.7) (4.4)p (6.2)p
All results relate to continuing operations.
Consolidated Statement of Comprehensive Income
for the six month period to 30 September 2017
MEMORANDUM
1 April 1 April 1 April 1 April
2017 to 2016 to 2017 to 2016 to
30 Sept 30 Sept 30 Sept 30 Sept
2017 2016 2017 2016
Unaudited Unaudited
INR million INR million GBP000 GBP000
Loss for the
period (647.4) (835.2) (7,767) (9,085)
----------------------- ----------- --------------- ---------- --------
Other comprehensive
income
Items that
may be reclassified
to income
statement
in subsequent
periods:
Currency translation
differences
from operations
denominated
in currencies
other than
Rupee - equity
holders of
the parent,
net of tax 1.7 (11.0) 21 (120)
Items that
will not be
reclassified
to income
statement
in subsequent
periods:
Re-measurement - - - -
of defined
benefits plan,
net of tax
----------------------- ----------- --------------- ---------- --------
Other comprehensive
income, net
of tax 1.7 (11.0) 21 (120)
----------- --------------- ---------- --------
Total comprehensive
loss for the
period (645.7) (846.2) (7,747) (9,205)
----------- --------------- ---------- --------
Total comprehensive
loss attributable
to:
Equity holders
of the Company (645.7) (817.4) (7,747) (8,892)
Non-controlling
interests - (28.8) - (313)
----------- --------------- ---------- --------
Total loss
recognised
in the period (645.7) (846.2) (7,747) (9,205)
----------- --------------- ---------- --------
All results relate to continuing operations.
Consolidated Statement of Financial Position
at 30 September 2017
MEMORANDUM
30 September 31 March 30 September 31 March
2017 2017 2017 2017
Unaudited audited
INR million INR million GBP000 GBP000
Non-current
assets
Intangible
assets 627.9 627.5 7,166 7,736
Property, plant
& equipment 22.2 18.5 254 228
Non-current
financial assets 6.8 8.7 78 107
------------ -----------
Total non-current
assets 657.0 654.7 7,498 8,071
------------ ----------- ------------ --------
Current assets
Inventories 219.5 187.9 2,505 2,316
Trade receivables,
other receivables,
prepayments
and other assets 662.2 710.8 7,557 8,762
Bank deposits 327.0 445.5 3,732 5,492
Cash and cash
equivalents 493.0 200.5 5,626 2,472
------------ ----------- ------------ --------
Total current
assets 1,701.6 1,544.7 19,420 19,042
------------ ----------- ------------ --------
Total assets 2,358.6 2,199.4 26,918 27,113
------------ ----------- ------------ --------
Non-current
liabilities
Loans and Borrowings (603.2) - (6,884)
Other Long-term
liabilities (13.5) (11.7) (155) (144)
------------ -----------
Total non-current
liabilities (616.7) (11.7) (7,039) (144)
------------ ----------- ------------ --------
Current liabilities
Bank short-term
borrowing (23.9) (48.7) (273) (600)
Trade and other
payables (337.7) (310.2) (3,854) (3,824)
------------ -----------
Total current
liabilities (361.6) (358.9) (4,127) (4,424)
------------ ----------- ------------ --------
Total liabilities (978.3) (370.6) (11,166) (4,568)
------------ ----------- ------------ --------
NET ASSETS 1,380.2 1,828.8 15,753 22,545
------------ ----------- ------------ --------
Capital and
reserves
Equity share
capital 168.0 168.0 1,754 2,071
Share premium
reserve 6,196.6 6,196.5 64,236 76,388
Convertible
debt option 170.7 - 2,072 -
Other reserves 20.3 (7.8) 231 (97)
Retained earnings (5,175.3) (4,527.9) (52,540) (55,817)
TOTAL EQUITY 1,380.2 1,828.8 15,753 22,545
------------ ----------- ------------ --------
All results relate to continuing operations.
Consolidated Statement of Cash Flows
for the six month period to 30 September 2017
MEMORANDUM
1 April 1 April 1 April 1 April
2017 to 2016 to 2016 to 2016 to
30 Sept 30 Sept 30 Sept 30 Sept
2017 2016 2017 2016
Unaudited Unaudited
INR million INR million GBP000 GBP000
Operating activities
Loss for the period (647.4) (835.2) (7,767) (9,085)
Adjustments to
reconcile
profit for the period
to net cash flow
from operating
activities
Depreciation and
amortisation 5.6 6.8 67 73
Share based payments 25.1 12.6 301 138
Other non-cash items 0.2 1.1 3 12
Interest income
and finance expense 7.5 (15.2) 90 (166)
Working capital
adjustments:
(Increase)/ Decrease
in inventories (31.5) 3.0 (378) 33
Decrease/(Increase)
in trade and other
receivables 48.6 (363.9) 583 (3,959)
Increase in trade
and other payables 27.5 72.6 330 790
------------------------ ------------------------ -------------------- --------------------
Cash flows from
operations (564.4) (1,118.2) (6,771) (12,164)
Income tax paid - - - -
------------------------ ------------------------ -------------------- --------------------
Net cash out flow
from operating
activities (564.4) (1,118.2) (6,771) (12,164)
------------------------ ------------------------ -------------------- --------------------
Investing activities
Acquisition of
remaining
shares in Koovs
India - (869.7) - (9,039)
Withdrawals: original
maturity greater
than 12 months 1.9 - 22 -
Deposits: original
maturity less than
12months 118.5 (372.2) 1,422 (4,049)
Purchase of plant
and equipment (4.5) (32.8) (54) (357)
Purchase of intangible
assets (2.8) (0.5) (34) (5)
Interest income
received 9.2 14.4 110 157
------------------------ ------------------------
Net cash in/(out)
flow from investing
activities 122.3 (1,260.8) 1,467 (13,293)
------------------------ ------------------------ -------------------- --------------------
Financing activities
Proceeds from issue
of shares - 2,534.0 - 26,200
Costs of share issues - (53.3) - (581)
Proceeds from
Convertible
Loan 773.9 - 9,284 -
Repayment of
short-term
borrowings (24.8) (29.9) (297) (325)
Interest and finance
expense (1.0) (3.2) (11) (35)
Net cash in flow
from financing
activities 748.1 2,447.6 8,976 25,259
------------------------ ------------------------ -------------------- --------------------
Net change in cash
and cash equivalents 306.1 68.6 3,672 (198)
Cash and cash
equivalents
at start of period 151.8 127.6 1,821 1,340
Exchange differences 11.2 (14.3) 134 966
------------------------ ------------------------ -------------------- --------------------
Cash and cash
equivalents
at end of period 469.1 181.9 5,628 (2,108)
------------------------ ------------------------ -------------------- --------------------
Notes
1. Basis of preparation and accounting policies
1.1. Basis of preparation
These interim consolidated financial statements have been
prepared using accounting policies based on International Financial
Reporting Standards (IFRS and IFRIC Interpretations) issued by the
International Accounting Standards Board ("IASB") as adopted for
use in the EU. They do not include all disclosures that would
otherwise be required in a complete set of financial statements and
should be read in conjunction with the 31st March 2017 Annual
Report. The financial information for the half years ended 30th
September 2017 and 30th September 2016 does not constitute
statutory accounts within the meaning of Section 434 (3) of the
Companies Act 2006 and both periods are unaudited.
The annual financial statements of Koovs plc are prepared in
accordance with IFRS as adopted by the European Union. The
comparative financial information for the year ended 31st March
2017 included within this report does not constitute the full
statutory Annual Report for that period. The statutory Annual
Report and Financial Statements for 2017 have been filed with the
Registrar of Companies. The Independent Auditors' Report on the
Annual Report and Financial Statements for the year ended 31st
March 2017 was unqualified, but did include a reference to the
uncertainty surrounding going concern, to which the auditors drew
attention by way of emphasis and did not contain a statement under
498(2) - (3) of the Companies Act 2006.
Going Concern for the six-month period to 30th September 2017 is
considered in note 1.2.
The same accounting policies, presentation and methods of
computation are followed in these interim consolidated financial
statements as were applied in the Group's 31st March 2017 annual
audited financial statements. In addition, the IASB have issued a
number of IFRS and IFRIC amendments or interpretations since the
last Annual Report was published. The directors have not yet
considered whether any of these will have a material impact on the
Group. The Board of Directors approved this interim report on 22nd
December 2017.
1.2. Going concern
This Interim Report has been prepared on the assumption that the
business is a going concern.
The Company's business activities, together with the factors
likely to affect its future development, financial position,
financial risk management objectives, details of its financial
instruments and its exposures to price, credit, liquidity and cash
flow risk are described in the Chairman's Statement and the
Strategic Report set out in the Annual Report for the year ended 31
March 2017.
In May 2017 the Board announced its intention to raise up to
GBP18.9m in convertible loan notes. As at the date of this report
GBP8.9m has been raised (Note 7) and the Company remains in
advanced negotiations and expects to announce the successful
conclusion of this additional funding in due course.
The directors have concluded that as the additional funding has
not been contractually secured at the date of this report, there
exists a material uncertainly which may cast doubt as to the Groups
ability to continue as a going concern.
However, given the existing negotiations and the Company's track
record of raising funding when required, the directors believe the
Group will to continue as a going concern for the foreseeable
future. The interim financial statements do not include the
adjustments that would be required if the Group were unable to
continue as a going concern.
1.3. Reporting currency
To assist UK-based readers of the accounts, translations into
Sterling have be supplied on a memorandum basis to allow a clear
understanding of the results and financial position of the
business. The memorandum information does not form part of the
financial reporting of the Group representing, as they do, simple
translations of the Rupee information. The exchange rates used are
shown in the table below.
6 Months 6 months Year to
to 30 Sept to 30 31 Mar
2017 Sept 2016 2017
INR/GBP INR/GBP INR/GBP
Balance Sheet 87.6 86.3 81.1
Trading statements 83.4 91.9 87.7
2. Revenue
All of the Group's revenue is generated by the Group's
subsidiary in India through its operations as a supplier of branded
fashion products. The chief operating decision maker is the Chief
Executive Officer who makes resource allocation decisions based on
Group management accounts and operating reports for the entire
Group. The Group therefore represents a single cash generating unit
and a single operating segment.
All of the Group's revenue in both periods was generated in the
Republic of India.
3. Taxation
No income tax liability arose during the six months to 30
September 2017 and 2016, or the year ended 31 March 2017. There is
no tax charge or credit relating to items charged or credited to
other comprehensive income.
4. Earnings Per Share
Basic earnings per share is calculated by dividing the earnings
attributable to the owners of the Parent Company by the weighted
average number of ordinary shares in issue during the period.
Diluted earnings per share is calculated by amending the weighted
average number of ordinary shares in issue during the period for
the effect of dilutive share options in issue.
6 months 6 months
to to
30 Sept 30 Sept
2017 2016
Unaudited Unaudited
Weighted average shares in
issue for basic earnings per
share 175,383,691 142,630,139
Effect of convertible loan
notes 22,250,000 -
------------------------ ------------------------
Weighted average shares in
issue for diluted earnings
per share 197,633,691 142,630,139
------------------------ ------------------------
Earnings attributable to the
owners of the Parent (INR million) (647.4) (806.4)
------------------------ ------------------------
Basic loss per share (Rupees) (3.7) (5.7)
Memorandum basic loss per share
(pence) (4.4) (6.2)
The effect of the share options in issue and the convertible
loan notes are anti-dilutive and therefore no adjustment has been
made to the weighted average shares in issue when calculating
diluted earnings per share.
6. Cash and bank deposits
Cash and bank deposits MEMORANDUM
30 Sept 30 Sept 30 30
2017 2016 Sept Sept
Unaudited Unaudited 2017 2016
INRm INRm GBP000 GBP000
Current assets:
Bank deposits with
an original maturity
of more than 12
months 1.0 - 11 -
Bank deposits with
an original maturity
of not more than
12 months 326.0 477.3 3,721 5,532
Cash at bank and
in hand 493.0 204.7 5,626 2,373
----------- ----------- ------- -------
820.0 682.0 9,358 7,905
Non-current assets:
Security deposits 6.8 8.7 78 100
Bank overdrafts (23.9) (22.8) (273) (265)
----------- ----------- ------- -------
Total net cash
and bank deposits 802.9 667.9 9,164 7,740
----------- ----------- ------- -------
MEMORANDUM
30 Sept 30 Sept 30 30
2017 2016 Sept Sept
Unaudited Unaudited 2017 2016
INRm INRm GBP000 GBP000
Cash and cash equivalents
Cash at bank and
in hand 493.0 204.7 5,626 2,373
Bank overdrafts (23.9) (22.8) (273) (265)
----------- ----------- ------- -------
Total cash and
cash equivalents 469.1 181.9 5,353 2,108
----------- ----------- ------- -------
Cash and cash equivalents comprise cash in hand and cash held in
bank accounts from which deposits can be drawn without any
substantial delay and which have not been deposited under any
agreement for a fixed term, net of any bank overdrafts which are
utilised for operational cash flow purposes.
7. Convertible Loan Note
On the 18(th) August 2017, the Company issued a 6% convertible
loan note at a nominal value of GBP8.9m.
The value of the liability component and the equity conversion
component were determined at the date the instrument was issued.
The fair value of the liability, including non-current borrowings,
at inception was calculated using an assumed market interest rate
of 22.5% for an instrument without a conversion option.
A Summary of the key terms of the loan notes is as follows
Term 24 months from completion of the
issue of the Convertible Loan Notes
----------------- ------------------------------------------------------------------
Conversion The Convertible Loan Notes can be
Price converted into Koovs Ordinary Shares
at a conversion price of GBP0.40
per share
----------------- ------------------------------------------------------------------
Redemption The Convertible Loan Notes can be
redeemed:
* at the election of the noteholders following a
material breach by the Company of the terms of the
Convertible Loan Note instrument;
* automatically on the occurrence of certain insolvency
events; and
* otherwise, automatically at the end of the two year
term
----------------- ------------------------------------------------------------------
Conversion The Convertible Loan Notes can be
Rights fully converted at any time by the
debenture holder giving to the Company
3 months' prior written notice
----------------- ------------------------------------------------------------------
Security All amounts falling due under the
Convertible Loan Notes will be secured
by a debenture constituting a first-ranking
fixed and floating charge over all
the assets of the Company (the "Debenture")
----------------- ------------------------------------------------------------------
Coupon & Payment 3-month sterling LIBOR + 6% per
annum, calculated monthly and rolled
up (but not compounded) with payment
at the end of the Term unless previously
converted, in which case accrued
interest is paid in kind in Ordinary
Shares at the Conversion Price or
at the point of conversion.
----------------- ------------------------------------------------------------------
Conversion The Company will have the right
by the Company to require the holder to convert
the Convertible Loan Notes into
equity at the Conversion Price if:
a) During the Term the 3-month volume
weighted average price of Koovs
Ordinary Shares is equal to, or
in excess of, GBP0.75; or
b) At the end of the Term if the
5-day volume weighted average price
of Koovs Ordinary Shares is equal
to, or in excess of, GBP0.45.
----------------- ------------------------------------------------------------------
"Most Favoured Following the issue of the Convertible
Nation" basis Loan Notes, if the Company proposes
to issue any convertible debt securities
or instruments ("New Convertibles")
on terms as to either the Coupon
or the Conversion Price that are
more favourable to subscribers of
the New Convertibles than to the
holders of the Convertible Loan
Notes, the holders of the Convertible
Loan Notes shall have the right
to require the Company to amend
the terms of the Convertible Loan
Notes so as to be at least equivalent
in those aspects to the New Convertibles
subject in all cases to all requisite
approvals from shareholders and
regulatory authorities.
----------------- ------------------------------------------------------------------
8. Cautionary statement
This document contains certain forward-looking statements
relating to Koovs plc ('the Company'). The Company considers any
statements that are not historical facts as "forward-looking
statements". They relate to events and trends that are subject to
risk and uncertainty that may cause actual results and the
financial performance of the Company to differ materially from
those contained in any forward-looking statement. These statements
are made by the directors in good faith based on information
available to them and such statements should be treated with
caution due to the inherent uncertainties, including both economic
and business risk factors, underlying any such forward-looking
information.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR BVLLFDLFBFBF
(END) Dow Jones Newswires
December 19, 2017 02:00 ET (07:00 GMT)
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