22 September 2021
Quantum Blockchain
Technologies plc
("Quantum Blockchain Technologies",
“the Group” or "the Company")
INTERIM
RESULTS
For the 6 Months
Ended 30 June 2021
Quantum Blockchain Technologies plc (AIM: QBT) announces its
unaudited Interim Results for the 6 months ended 30 June 2021.
HIGHLIGHTS
-
Raised £1.7million through two equity placings
-
Received shareholder approval to commence new blockchain &
cryptocurrencies strategy
-
Appointed sector expert to create new optimisations for mining
Bitcoin
POST PERIOD HIGHLIGHTS
-
Created several specialist working groups to investigate
multiple approach solutions
-
Commenced work on D-Wave Systems quantum cloud service
-
Achieved first speed improvement in mining Bitcoin
For further information please
contact:
Quantum Blockchain Technologies
Plc
Francesco Gardin, CEO and Executive Chairman |
+39 335 296573 |
SP Angel Corporate Finance
(Nominated Adviser & Broker)
Jeff Keating |
+44 (0)20 3470 0470 |
Leander (Financial PR)
Christian Taylor-Wilkinson |
+44 (0) 7795 168 157 |
About Quantum Blockchain Technologies Plc
QBT (AIM: QBT) is an AIM listed investment company which has
recently realigned its strategic focus to technology related
investments, with special regard to Quantum computing, Blockchain,
Cryptocurrencies and AI sectors. The Company has commenced an
aggressive R&D and investment programme in the dynamic world of
Blockchain Technology, which includes cryptocurrency mining and
other advanced blockchain applications.
For further information, please
visit, www.quantumblockchaintechnologies.co.uk
Chairman’s
Statement
Overview
The early months of 2021 marked a distinct change of direction
for our company, reflected in a change of name from Clear Leisure
to Quantum Blockchain Technologies Plc (QBT) and more practically,
a new foundation on which the Company’s future will be built.
In February 2021, the Company
raised £680,000 and £1,000,000 (both amounts before expenses) via
two equity placings, respectively at 0.6p and 1p per new ordinary
share of 0.25 pence each in the
Company (“Ordinary Shares”). These new funds facilitated the launch
of the new Investment Strategy focused on the development of an
innovative and disruptive technology for Blockchain, Cryptocurrency
and Quantum Computing.
The new strategy was approved by shareholders on 6 May 2021, at a General Meeting where the
Company received approval for the following:
-
To amend the Company’s Investing Policy with a focus on
Blockchain, Cryptocurrency, Quantum Computing and Artificial
Intelligence.
-
To change the Company’s name from Clear Leisure Plc to Quantum
Blockchain Technologies plc.
-
To authorise the granting of options to the CEO and current and
future management team of the Company.
-
To grant authorities to the directors to issue shares in the
Company.
In June 2021, the Company formally
announced the launch and current progress status of its new
in-house Research & Development (“R&D”)
programme in respect of advanced proprietary techniques for
Bitcoin mining. The Company further announced the appointment of a
UK based, international cryptography expert, whose specialism is
cryptocurrency mining blockchain optimisations. As part of the
appointment, the consultant was awarded share options over
10,000,000 new Ordinary Shares at an exercise price of 5p each,
which can be exercised between 15 February
2022 and 15 August 2022.
The aim of the R&D programme is to develop Bitcoin mining
tools and techniques which will significantly outperform existing
mining equipment, both in speed and energy consumption. While the
Board is aware this is an ambitious project, given the radically
advanced technologies and methodologies being used, it believes
that the goal is achievable.
Legacy Assets
In May 2021, the Company reported
in respect of the Sipiem S.p.A. (“Sipiem”) legal claim, that
the Court of Venice appointed
independent expert had filed his report on the economic merit of
the damages suffered by Sipiem and valued up to an amount of €7.8
million, subject to the Judge ruling that the conduct of Sipiem’s
former board and internal audit committee was unlawful. However, at
the hearing, the Company was informed that as one of the defendants
had sadly passed away, it was required to take a few additional
mandatory procedural steps, and this inevitably delayed the
proceedings. The Court of Venice
has re-scheduled the hearing for 10 November
2021 at which time the Judge will receive the parties’
comments on the report of the independent expert.
At the beginning of the year, the Company was notified that the
Bologna Court elected to continue the €1.03 million legal claim
against the previous management of Sosushi Srl, through an
arbitration process (formally started on 18
January 2021), which will provide a legally binding decision
on the matter.
On 20 January 2021, the Company
(at the conclusion of the mandatory public bidding process), was
assigned a legal claim against the former management of
Mediapolis S.A. and its internal audit committee, for a
consideration of €50,000, which will be deducted from the amount
still receivable from the Mediapolis Bankruptcy procedure.
As announced in June, the Company increased its stake in
Forcrowd Srl (“ForCrowd”) from 20% to 41.17% for a
consideration of €34,000; having taken advantage of a special
situation that had arisen amongst previous minority shareholders.
ForCrowd also launched a new crowdfunding campaign in 2021 that has
already received pre-launch investment commitments, enhancing the
probability of a successful conclusion.
PBV Monitor srl (“PBV”), is focusing on the efficient
marketing of its data intelligence service to law firms and
in-house legal counsels, whilst consolidating its editorial
partnerships in Italy (to print
and sell sectorial printed directories) and establish new
relationships, especially in the USA. PBV also expects that, in the light of
the general improvement of the Covid-19 pandemic in Europe, it will re-launch its industry award
events for the legal sector later in 2021. The next step in the
roadmap for PBV is the soft launch of its new legal networking
platform.
Geosim Systems Ltd (“Geosim”) is also moving forward, and
it is currently completing the first Phase in the development of a
3D Reality Model for a major North American airport
Financial Review
The Group reported a total comprehensive loss for the period to
30 June 2021 of €1.1 million
(30 June 2020: loss €363,000). The
operating loss for the period was €714,000 (30 June 2020: operating loss €228,000). At
30 June 2021, the Group improved the
net liabilities to €1.4 million, compared to negative €1.9 million
at 30 June 2020. The Net Current
Assets of the Group also improved during the period under review,
to €6.1 million, compared to €2.1 million at 30 June 2020.
Post 30 June
2021 Events
In July, the Company announced the agreement to use the Leap™
quantum cloud service from D-Wave Systems Inc (“D-Wave”); marking
an important step forward in the R&D programme.
Subsequently, in August, the Company provided an update on the
status and findings of its R&D project as follows:
-
Creation of the R&D team,
comprising 13 sector experts
-
Formation of working groups for:
-
Quantum Computing
-
Cryptographic Optimisation
-
Deep Learning and Artificial
Intelligence (“AI”)
-
FPGA / ASIC Design
-
Algebraic and Boolean Equation
Reduction
-
BTC Large Big Data
-
High performance computing
architectures
The initial findings of the new R&D work have been very
encouraging, with a 9.56% speed improvement already achieved as
compared to the standard Bitcoin mining algorithm on the same type
of machine. The Company is currently investigating other
optimisations for Bitcoin mining, based on its innovative approach
(people and technology), which it believes will deliver further and
radical speed improvements which the Company is planning to file
under an international patent.
In the early stages of the AI Deep-Learning tests to optimise
the Bitcoin mining algorithm, QBT’s AI system autonomously
generated one of the already existing optimisation provided to the
Company by its expert. This first result strongly supports the AI
Deep Learning strategy adopted by the Company.
The Company has also started to implement the first set of
optimisations on FPGA, expecting early completed versions of the
FPGA to be ready by the end of October
2021, while the optimisations covered by the above-mentioned
patent are due by December 2021. ASIC
development work is expected to start in parallel in October 2021.
Based on the performance achieved by the FPGA chip, it may be
decided to use it as the Company’s first mining engine.
QBT’s Quantum Computing team has now started working on the
D-wave Quantum computer, programming the quantum processor, whilst
the Company completed the design of the new IT infrastructure. This
new infrastructure includes a 128 core Machine Learning workstation
and an initial one Petabyte memory expandable unit, in order to
host the proprietary enriched Bitcoin mining “BTC Large Big
Data”.
Outlook
The Board remains committed to return value to its stakeholders,
over the next 24 months, by:
-
Positioning the Company in the Quantum Computing, Blockchain and
Cryptocurrency sectors, both via new investment activity and its
in-house R&D projects.
-
Realisation of its legacy assets, for which positive outcomes
are expected from the legal claims being pursued by the
Company.
-
Further reduction of the debt position (if and when the
conditions are deemed appropriate).
The Board maintains a positive outlook with regards to the
Company’s new investment strategy focused on Quantum Computing,
Blockchain and Cryptocurrency in combination with its existing
technology investments and remaining legal claims which, the
Company believes, are drawing towards a positive conclusion.
Francesco
Gardin
Quantum Blockchain Technologies
PLC
CEO and Chairman
GROUP STATEMENT OF COMPREHENSIVE
INCOME
FOR THE PERIOD ENDED 30 JUNE 2021
|
Note |
Six
months to 30 June 2021
Unaudited |
Six
months to 30 June 2020
Unaudited |
Year
ended 31 December 2020
Audited |
Continuing operations |
|
€’000 |
€’000 |
€’000 |
Revenue |
|
6 |
32 |
12 |
Cost of
sales |
|
- |
- |
- |
|
|
6 |
32 |
12 |
Administrative expenses |
|
(720) |
(260) |
(1,123) |
Other
operating income |
|
- |
- |
24 |
Operating loss |
|
(714) |
(228) |
(1,087) |
Other
gains and losses |
|
- |
6 |
- |
Finance
charges |
|
(392) |
(141) |
(121) |
Loss
before tax |
|
(1,106) |
(363) |
(1,208) |
Taxation |
|
- |
- |
- |
Loss
for the period attributable to owners of the parent |
|
(1,106) |
(363) |
(1,208) |
Other comprehensive loss: |
|
|
|
|
Loss on
translation of overseas subsidiaries |
|
- |
- |
- |
TOTAL
COMPREHENSIVE LOSS FOR THE PERIOD ATTRIBUTABLE TO OWNERS OF THE
PARENT |
|
(1,106) |
(363) |
(1,208) |
Earnings per share: |
|
|
|
|
Basic and
diluted loss per share |
3 |
(€0.13) |
(€0.001) |
(€0.182) |
|
|
|
|
|
|
|
|
|
|
GROUP STATEMENTS OF
FINANCIAL POSITION
AT 30 JUNE 2021
|
Note |
As at
30 June
2021
€’000
(Unaudited) |
As at
30 June
2020
€’000
(Unaudited)
(Restated) |
As at
31 December 2020
€’000
(Audited) |
Non-current assets |
|
|
|
|
Investments |
|
1,014 |
1,114 |
980 |
Total non-current assets |
|
1,014 |
1,114 |
980 |
|
|
|
|
|
Current assets |
|
|
|
|
Trade and other receivables |
|
5,315 |
6,627 |
5,191 |
Cash and cash equivalents |
|
1,083 |
1 |
- |
Total current assets |
|
6,398 |
6,628 |
5,191 |
|
|
|
|
|
Current liabilities |
|
|
|
|
Trade and other payables |
|
(265) |
(490) |
(334) |
Borrowings |
|
- |
(3,910) |
- |
Derivative financial
instruments |
|
- |
(121) |
- |
Total current
liabilities |
|
(265) |
(4,521) |
(334) |
|
|
|
|
|
Net current assets |
|
6,133 |
2,107 |
4,857 |
|
|
|
|
|
Total assets less current
liabilities |
|
7,147 |
3,221 |
5,837 |
|
|
|
|
|
Non-current liabilities |
|
|
|
|
Borrowings |
|
(8,606) |
(5,213) |
(8,212) |
Total non-current
liabilities |
|
(8,606) |
(5,213) |
(8,212) |
|
|
|
|
|
Total liabilities |
|
(8,871) |
(9,734) |
(8,545) |
|
|
|
|
|
Net liabilities |
|
(1,459) |
(1,992) |
(2,375) |
|
|
|
|
|
Equity |
|
|
|
|
Share capital |
|
8,080 |
7,397 |
7,397 |
Share premium account |
|
48,463 |
47,124 |
47,124 |
Other reserves |
|
8,787 |
8,376 |
8,787 |
Retained losses |
|
(66,789) |
(64,889) |
(65,683) |
Equity attributable to
owners of the Company |
|
(1,459) |
(1,992) |
(2,375) |
Total equity |
|
(1,459) |
(1,992) |
(2,375) |
GROUP AUDITED STATEMENT OF CHANGES IN
EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2020
Group |
Share
capital
€’000 |
Share
premium
account
€’000 |
Other
reserves
€’000 |
Retained losses
€’000 |
Total
equity
€’000 |
|
|
|
|
|
|
At 1
January 2020 |
7,397 |
47,124 |
8,376 |
(64,526) |
(1,629) |
Total
comprehensive loss for the year |
- |
- |
- |
(1,208) |
(1,208) |
Lapsed
share options |
- |
- |
(51) |
51 |
- |
Equity
portion of convertible loan notes |
- |
- |
462 |
- |
462 |
At 31 December
2020 |
7,397 |
47,124 |
8,787 |
(65,683) |
(2,375) |
GROUP UNAUDITED
STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTHS
TO 30 JUNE 2020
Group |
Share
capital
€’000 |
Share
premium
account
€’000 |
Other
reserves
€’000 |
Retained losses
(restated)
€’000 |
Total
equity
(restated)
€’000 |
|
|
|
|
|
|
At 1 January 2020 |
7,397 |
47,124 |
8,376 |
(64,526) |
(1,629) |
Total
comprehensive loss for the period |
- |
- |
- |
(363) |
(363) |
At 30
June 2020 |
7,397 |
47,124 |
8,376 |
(64,889) |
(1,992) |
|
|
|
|
|
|
GROUP UNAUDITED
STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTHS
TO 30 JUNE 2021
Group |
Share
capital
€’000 |
Share
premium
account
€’000 |
Other
reserves
€’000 |
Retained losses
€’000 |
Total
equity
€’000 |
|
|
|
|
|
|
At 1 January 2021 |
7,397 |
47,124 |
8,787 |
(65,683) |
(2,375) |
Issue of
share capital |
683 |
1,339 |
- |
- |
2,022 |
Total
comprehensive loss for the period |
- |
- |
- |
(1,106) |
(1,106) |
At 30
June 2021 |
8,080 |
48,463 |
8,787 |
(66,789) |
(1,459) |
|
|
|
|
|
|
GROUP UNAUDITED STATEMENT OF CASH
FLOWS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
|
|
Six months to 30
June 2021
Unaudited
€’000 |
Six months to 30
June 2020
Unaudited
€’000 |
Year ended 31
December 2020
Audited
€’000 |
|
|
|
|
|
Cash used in operations |
|
|
|
|
Loss before tax |
|
(1,106) |
(363) |
(1,208) |
Fair value changes |
|
248 |
6 |
- |
Impairment of investments |
|
- |
- |
89 |
Other gains |
|
- |
- |
50 |
Finance charges |
|
146 |
141 |
247 |
Decrease/(increase) in
receivables |
|
(124) |
(23) |
1,417 |
(Decrease)/increase in payables |
|
(69) |
93 |
(61) |
Decrease in derivatives |
|
- |
- |
(121) |
|
|
|
|
|
Net cash (outflow)/inflow from
operating activities |
|
(905) |
(146) |
413 |
|
|
|
|
|
Cash flows from
investing activities |
|
|
|
|
Purchase of
investments |
|
(34) |
- |
(2) |
Proceeds from issues
of new ordinary shares (net of expenses) |
|
2,022 |
- |
- |
Net cash inflow from investing
activities |
|
1,988 |
- |
(2) |
|
|
|
|
|
Cash flows from financing
activities |
|
|
|
|
New borrowings |
|
- |
150 |
150 |
Repayment from
borrowings |
|
- |
(3) |
(561) |
Net cash
inflow/(outflow) from financing activities |
|
- |
147 |
(411) |
|
|
|
|
|
Net increase in cash for the
period |
|
1,083 |
1 |
- |
Cash and cash
equivalents at beginning of year |
|
- |
- |
- |
|
|
|
|
|
Cash and cash equivalents at end
of period |
|
1,083 |
1 |
- |
|
|
|
|
|
NOTES TO THE FINANCIAL STATEMENTS
-
General Information
Quantum Blockchain Technologies plc is a company incorporated
and domiciled in England and
Wales. The Company’s ordinary
shares are traded on the AIM market of the London Stock Exchange.
The address of the registered office is 22 Great James Street,
London, WC1N 3ES.
The principal activity of the Group is that of an investment
company pursuing a strategy to create a portfolio of companies.
2. Accounting policies
The principal accounting policies are summarised below. They
have all been applied consistently throughout the period covered by
these consolidated financial statements.
Basis of preparation
The interim financial statements of Quantum Blockchain
Technologies Plc are unaudited consolidated financial statements
for the six months ended 30 June 2021
which have been prepared in accordance with UK adopted
International accounting standards. They include unaudited
comparatives for the six months ended 30
June 2020 together with audited comparatives for the year
ended 31 December 2020.
The interim financial statements do not constitute statutory
accounts within the meaning of section 434 of the Companies Act
2006. The statutory accounts for the year ended 31 December 2020 have been reported on by the
company’s auditors and have been filed with the Registrar of
Companies. The report of the auditors was qualified in respect of
the valuation of the investment in Geosim Systems Ltd, and the
omission of Mediapolis Investment S.A. from the consolidated
accounts. The report of the auditor also contained an
emphasis of matter paragraph in respect of a material uncertainty
regarding going concern. Aside from the limitation of scope
relating to Geosim Systems Ltd and Mediapolis Investment S.A, the
auditor’s report did not contain any statement under section 498 of
the Companies Act 2006.
The interim financial statements for the period ended
30 June 2020 have been restated for
the adjustment made in respect of Zero Coupon Bonds and Other
Convertible Loans, further details of which can be found in the
financial statements for the year ended 31
December 2020.
The interim consolidated financial statements for the six months
ended 30 June 2021 have been prepared
on the basis of accounting policies expected to be adopted for the
year ended 31 December 2021, which
are consistent with the year ended 31
December 2020 except as stated below:
Going concern
The Group’s activities generated a loss of €1,106,000
(June 2020: €363,000) and had net
current assets of €6,133,000 as at 30 June
2021. The Group’s operational existence is still dependent
on the ability to raise further funding either through an equity
placing on AIM, or through other external sources, to support the
on-going working capital requirements.
After making due enquiries, the Directors have formed a
judgement that there is a reasonable expectation that the Group can
secure further adequate resources to continue in operational
existence for the foreseeable future and that adequate arrangements
will be in place to enable the settlement of their financial
commitments, as and when they fall due.
For this reason, the Directors continue to adopt the going
concern basis in preparing the interim accounts. Whilst there are
inherent uncertainties in relation to future events, and therefore
no certainty over the outcome of the matters described, the
Directors consider that, based upon financial projections and
dependant on the success of their efforts to complete these
activities, the Group will be a going concern for the next twelve
months. If it is not possible for the Directors to realise their
plans, over which there is significant uncertainty, the carrying
value of the assets of the Group is likely to be impaired.
In relation to the impact of COVID-19 on the Company, the
Company's employees can carry out their duties remotely, via the
network infrastructure in place. As a result, there was no
disruption to the operational activities of the Company during the
COVID-19 social distancing and working from home restrictions. All
key business functions continue to operate at normal capacity.
Notwithstanding the above, the Directors note the material
uncertainty in relation to the Group being unable to realise its
assets and discharge its liabilities in the normal course of
business.
Risks and uncertainties
The Board continuously assesses and monitors the key risks of
the business. The key risks that could affect the Company’s
medium-term performance and the factors that mitigate those risks
have not substantially changed from those set out in the Company’s
2020 Annual Report and Financial Statements, a copy of which is
available on the Company’s website:
www.quantumblockchaintechnologies.com. The key financial risks
are liquidity and credit risk.
Critical accounting estimates
The preparation of interim financial statements requires
management to make estimates and assumptions that affect the
reported amounts of assets and liabilities at the end of the
reporting period. Significant items subject to such estimates are
set out in note 3 of the Company’s 2020 Annual Report and Financial
Statements. The nature and amounts of such estimates have not
changed significantly during the interim period.
3. Loss per share
The basic earnings per share is calculated by dividing the
earnings attributable to ordinary shareholders by the weighted
average number of ordinary shares outstanding during the period.
Diluted earnings per share is computed using the same weighted
average number of shares during the period adjusted for the
dilutive effect of share warrants and convertible loans outstanding
during the period.
The profit and weighted average number of shares used in the
calculation are set out below:
|
Six
months to 30 June 2021 |
Six
months to 30 June 2020 |
Six
months to
31 December 2020 |
|
|
(Unaudited) |
(Unaudited) |
(Audited) |
|
€’000 |
€’000 |
€’000 |
|
Loss/profit
attributable to owners of the parent company: |
|
|
|
|
Basic earnings |
(1,106) |
(363) |
(1,208) |
|
Diluted earnings |
(1,106) |
(363) |
(1,208) |
|
Basic weighted average
number of ordinary shares (000’s) |
836,537 |
618,891 |
662,371 |
|
Diluted weighted
average number of ordinary shares (000’s) |
836,537 |
618,891 |
662,371 |
|
Basic and fully
diluted earnings per share: |
|
|
|
|
Basic earnings per
share |
(€0.13) |
(€0.001) |
(€0.182) |
|
Diluted earnings per
share |
(€0.13) |
(€0.001) |
(€0.182) |
|
IAS 33 requires presentation of diluted earnings per share when
a company could be called upon to issue shares that would decrease
earnings per share or increase net loss per share. For a loss
making company with outstanding share options and warrants, net
loss per share would only be increased by the exercise of
out-of-the money options and warrants, so no adjustment has been
made to diluted earnings per share for out-of-the money options and
warrants in the comparatives.
4. Investment Policy
The Company intends on identifying and investing in investment
opportunities which it believes show excellent growth potential on
a stand-alone basis and which would add value to the Company's
portfolio of investments through the expertise of the Board or
through the provision of ongoing funding.
It is the intention of the Company that the majority of
investments will be made in unlisted companies; however, pre-IPO
and listed companies may, from time to time, be considered on a
selective basis.
The Company believes that the collective experience of the Board
together with its extensive network of contacts will assist them in
the identification, evaluation, and funding of investment targets.
When necessary other external professionals will be engaged to
assist in the due diligence of prospective targets. The Board will
also consider, as it sees fit, appointing additional directors
and/or key employees with relevant experience as part of any
specific investment.
The Company may offer shares as well as cash by way of
consideration for prospective investments, thereby helping to
preserve the Company's cash for working capital. The Company may,
in appropriate circumstances, issue debt securities or borrow money
to complete an investment.
5. Copies of Interim Accounts
Copies of the interim results are available at the Group’s
website at www.quantumblockchaintechnologies.co.uk.
Copies may also be obtained from the Group´s registered office:
Quantum Blockchain Technologies PLC, 22 Great James Street London
WC1N 3ES.