TIDMWPHO

RNS Number : 7413D

Windar Photonics PLC

30 June 2021

30 June 2021

Windar Photonics plc

("Windar" or the "Company")

Final Results and Notice of AGM

Windar Photonics plc (AIM:WPHO), the technology group that has developed a cost efficient and innovative LiDAR wind sensor for use on electricity generating wind turbines, is pleased to announce its final audited results for the year ended 31 December 2020 ("FY20").

Notice of Annual General Meeting

The Company is pleased to confirm that its Annual General Meetings ("AGM") will be held at the offices of West Hill Corporate Finance Ltd, 85 Gresham Street, London, EC2V 7NQ at 1.00 p.m. on 26 July 2021.

In light of the Coronavirus (COVID-19) pandemic and the restrictions imposed by the UK Government, the Company will convene the AGM with the minimum necessary quorum of two shareholders (which the Company will facilitate), and further shareholders will not be permitted to attend the AGM in person. The Company will include all valid proxy votes (whether submitted electronically or in hard copy form) in its polls at the AGM and the Chair of the meeting will call for a poll on each resolution. The Company accordingly requests that shareholders submit their proxy votes in respect of the resolutions as set out in the Notice of the AGM, electronically or by post in advance, in accordance with the instructions set out in the Notice of the AGM.

Shareholders should submit their votes via proxy as early as possible, and shareholders are requested to appoint the Chairman of the meeting as their proxy. If a shareholder appoints someone else as their proxy, that proxy will not be able to attend the AGM in person or cast the shareholder's vote.

Copies of the Annual Report and Accounts for the year ended 31 December 2020 and the Notice of the Annual General Meeting are available from the Company's website - www.windarphotonics.com

Copies of the Annual Report and Accounts for FY20 and the Notice of the Annual General Meeting will be posted to shareholders today and will be available from the Company's website - www.windarphotonics.com

Related Party Opinion

Jørgen Korsgaard Jensen, Chief Executive Officer of the Company, has agreed to provide a letter of support to the Company up to a value of EUR1,000,000 for a period of 12 months from the date of publication of the FY20 final audited results (the "Letter of Support"). If the Company requires to utilise the funds available under the Letter of Support, the funds will be provided on an interest free basis.

The provision of this letter of support to the Company is deemed to be a related party transaction for the purposes of the AIM Rules for Companies. The independent Directors consider, having consulted with the Company's nominated adviser, Cenkos Securities plc, that the terms of the letter of support are fair and reasonable insofar as the Shareholders are concernced.

For further information, please contact:

 
 Windar Photonics plc                       Tel: +45 24234930 
 Jørgen Korsgaard Jensen, CEO 
 
 Cenkos Securities plc (Nomad & Broker) 
 Neil McDonald / Pete Lynch                 Tel: 0131 220 6939 
 

About Windar:

Windar Photonics is a technology group that develops cost-efficient and innovative Light Detection and Ranging ("LiDAR") optimization systems for use on electricity generating wind turbines. LiDAR wind sensors in general are designed to remotely measure wind speed and direction.

http://investor.windarphotonics.com

Chairman's Statement

Despite a positive start the year with the receipt of the first volume order from the OEM market for the Company's LiDAR wind sensor, the onset of the COVID-19 pandemic had a significant impact on the ability of the Company to deliver orders during the year. Notwithstanding the impact of the global pandemic, the Company generated revenue of EUR1.3 million, an increase of 13% compared to 2019 (EUR1.2 million). Coupled with the implementation of cost saving initiatives throughout the Company, the EBITDA loss was reduced by 61% to EUR1.1 million (2019: loss of EUR2.8 million).

Total orders received and scheduled for delivery in 2020 amounted to EUR2.9 million. However, primarily due to the impact of the pandemic delivery of orders amounting to EUR1.6 million were postponed and rescheduled for delivery in 2021.

The retro-fit market operations were particularly adversely impacted by the onset of the pandemic due to project delays and travel restrictions. However important customer trials under our distribution agreement with Vestas were initiated and finalized in 2020 with very encouraging results Management expect to see the first volume orders and deliveries through this channel to be realised in 2021.

Our continued drive to optimize the cost base of our products has resulted in the Company successfully completing our new OneUnit platform which means the complete with electronic box has been eliminated. All optical and electronic parts now fully integrated in our optical head. With this platform now fully developed, our average production costs going into 2021 are estimated to have reduced by close to 21% compared the average costs at the beginning of 2020. Besides the cost saving the new platform enables a substantial simplification of the installation process of our products bringing additional cost savings to our end users.

Within the various other ongoing development projects good progress has been achieved in 2021. In previous years, the Company was focused on expanding our wind measurements data capabilities beyond the measurement of wind speed and wind direction to include wind turbulence and wake data which today are fully integrated in the entire project range. Going forward and based on new software developments the Company will also be integrating rain intensity data in our product range.

Financial Overview

Revenue during the year increased by 13% to EUR1.3 million (2019: EUR1.2 million). Gross profit was up 28% (2019: (47%)) to EUR0.7 million (2019: EUR0.5 million).

Net loss for the year before taxes decreased to EUR1.6 million from EUR3.3 million in 2019, which included depreciation, amortisation and warrant costs of EUR0.3 million (2019: EUR0.3 million).

The Group held cash balances at the end of the year of EUR0.6 million (2019: EUR0.8 million).

Trade receivables were EUR0.4 million (2019: EUR0.1 million), reflecting that most of the revenue recognized in 2020 was delivered during the last quarter of the year.

The Group has capitalised its continued cost of investment in technology during the year. This amounts to EUR0.5 million in 2020 (2019: EUR0.5 million) before grants of EUR0.2 million (2019: EUR0.1 million).

During the year, the Group raised EUR1.0 million before expenses through the issue of share capital.

Outlook

Even though there remain significant project and delivery delays in the first part of 2021 due to aftermath of the global pandemic, the Board expects to see a substantial revenue increase in 2021. This expectation is based on the orderbook at the start of the year which contained a number of orders initially scheduled for delivery in 2020. In addition, the Board expects to receive new orders and has strong expectations for initial volume orders/deliveries under our distribution agreement with Vestas.

Despite the overall encouraging developments, the Group's cash flow position is constantly being monitored with respect to eventual consequences of customer payments and project delays. However, management believe that there are a number of actions available to them in order to manage the cash position if needed.

Positively, the total order inflow in 2020 has been encouraging at EUR2.9 million which approximately represents the annual break even fix point in the Group. Given the order back-log carried into 2021, orders received and expected new orders the Board believes the Group is in a good position moving forward.

Finally, I would like to take the opportunity to thank the management and staff for their efforts in 2020.

BY ORDER OF THE BOARD ON June 30, 2021

Johan Blach Petersen

Chairman

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE YEARED 31 DECEMBER 2020

 
 
                                               Year ended                 Year ended 
                                              31 December                31 December 
                                                     2020                       2019 
                                                      EUR                        EUR 
 
  Revenue from contracts with customers         1,333,956                  1,177,897 
 Cost of goods sold                             (632,586)                  (629,560) 
  Gross profit                                    701,370                    548,337 
 
 Administrative expenses                      (2,183,141)                (3,680,990) 
  Other operating income                           32,196                     32,145 
------------------------------------------ 
  Loss from operations                        (1,449,575)                (3,100,508) 
 
 Finance expenses                               (143,110)                  (190,889) 
  Loss before taxation                        (1,592,685)                (3,291,397) 
 
  Taxation                                        252,517                    212,488 
  Loss for the year attributable to 
   the ordinary equity holders of Windar 
   Photonics Plc                               (1,340,168                (3,078,909) 
 
  Other comprehensive income 
  Items that will or may be reclassified 
   to profit or loss: 
  Exchange gains/(losses) arising 
   on translation of foreign operations            22,585                    (3,085) 
------------------------------------------ 
 Total comprehensive loss for the 
  year attributable to the ordinary 
  equity holders of Windar Photonics 
  Plc                                         (1,317,583)                (3,075,824) 
                                            =============  ========================= 
 
 Loss per share attributable to the 
  ordinary equity holders of Windar 
  Photonics Plc 
  Basic and diluted, cents per share                (2.7)                      (6.7) 
==========================================  =============  ========================= 
 

All activities relate to continuing operations

CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2020

 
 
                                                31 December    31 December 
                                                       2020           2019 
                                                        EUR            EUR 
 
 Assets 
 Non-current assets 
 Intangible assets                                1,205,243      1,192,607 
 Property, plant & equipment                         27,698         61,800 
 Deposits                                            25,382         24,980 
 Total non-current assets                         1,258,323      1,279,387 
--------------------------------------------  -------------  ------------- 
 
  Current assets 
  Inventory                                         636,785      1,019,564 
  Trade receivables                                 429,241        111,703 
   Other receivables                                220,047         84,305 
    Tax credit receivables                          253,030        212,428 
  Prepayments                                        14,195         44,857 
  Restricted cash and cash equivalents                    -              - 
  Cash and cash equivalents                         626,361        763,024 
  Total current assets                            2,179,659      2,235,881 
--------------------------------------------  -------------  ------------- 
 
  Total assets                                    3,437,982      3,515,268 
--------------------------------------------  -------------  ------------- 
 
  Equity 
  Share capital                                     675,664        608,689 
  Share premium                                  14,502,837     13,692,119 
  Merger reserve                                  2,910,866      2,910,866 
  Foreign currency reserve                            3,955       (18,630) 
  Retained earnings                            (17,651,945)   (16,338,796) 
  Total equity                                      441,377        854,248 
--------------------------------------------  -------------  ------------- 
 
  Non-current liabilities 
  Warranty provisions                                38,493         61,170 
  Loans                                           1,719,825          5,174 
--------------------------------------------  -------------  ------------- 
  Total non-current liabilities                   1,758,318         66,344 
 
  Current liabilities 
  Trade payables                                    726,007      1,045,792 
  Other payables and accruals                       274,202        211,879 
  Contract liabilities                              215,905         69,954 
  Invoice discounting                                     -          1,992 
  Loans                                              22,173      1,265,059 
                                              -------------  ------------- 
  Total current liabilities                       1,238,287      2,594,676 
 
  Total liabilities                               2,996,605      2,661,020 
--------------------------------------------  -------------  ------------- 
 
  Total equity and liabilities                    3,437,982      3,515,268 
--------------------------------------------  -------------  ------------- 
 

The financial statements were approved and authorised for issue by the Board of Directors on June 30 2021 and were signed below on its behalf by:

Jørgen Korsgaard Jensen, Director

Company number: 09024532

COMPANY STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2020

 
 
                                    31 December    31 December 
                                           2020           2019 
                                            EUR            EUR 
 
  Assets 
 Non-current assets 
 Investments in subsidiaries            142,497        519,897 
  Total non-current assets              142,497        519,897 
--------------------------------  -------------  ------------- 
 
  Current assets 
  Other receivables                      11,295         11,790 
  Prepayments                                 -         26,599 
  Intragroup receivables                  2,074         43,088 
  Cash and cash equivalents             543,247        521,713 
  Total current assets                  556,616        603,190 
--------------------------------  -------------  ------------- 
 
  Total assets                          699,113      1,123,087 
--------------------------------  -------------  ------------- 
 
 
  Equity 
  Share capital                         675,664        608,689 
  Share premium                      14,502,837     13,692,119 
  Merger reserve                        658,279        658,279 
  Foreign currency reserve                    -        (7,746) 
  Retained earnings                (15,395,399)   (14,046,739) 
  Total equity                          441,381        904,602 
--------------------------------  -------------  ------------- 
 
 
  Current liabilities 
  Trade payables                        233,648        198,485 
  Other payables and accruals            24,084         20,000 
  Total liabilities                     257,732        218,485 
--------------------------------  -------------  ------------- 
 
  Total equity and liabilities          699,113      1,123,087 
--------------------------------  -------------  ------------- 
 
 

The financial statements were approved and authorised for issue by the Board of Directors on June 30 2021 and were signed below on its behalf by:

Jørgen Korsgaard Jensen, Director

Company number: 09024532

CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEARED 31 DECEMBER 2020

 
 
                                            Year ended     Year ended 
                                           31 December    31 December 
                                                  2020           2019 
                                                   EUR            EUR 
 
  Loss for the period before taxation      (1,592,685)    (3,291,397) 
 
  Adjustments for: 
  Finance expenses                             143,110        190,889 
  Amortisation                                 286,903        267,317 
  Depreciation                                  38,752         52,411 
  Received tax credit                          212,864        120,186 
  Foreign exchange losses                       22,691          3,085 
  Share option and warrant costs                27,020         27,868 
---------------------------------------  -------------  ------------- 
                                             (861,345)    (2,629,641) 
 
  Movements in working capital 
  Changes in inventory                         382,779      (292,565) 
  Changes in receivables                     (453,281)        144,164 
  Changes in prepayments                        30,663         38,905 
  Changes in deposits                            (401)         21,305 
  Changes in trade payables                  (319,788)        552,426 
  Changes in contract liabilities              145,951       (13,214) 
  Changes in warranty provisions              (22,677)       (17,252) 
  Changes in other payables and 
   provisions                                   62,321        447,972 
  Cash flow from operations                (1,035,778)    (1,747,900) 
---------------------------------------  -------------  ------------- 
 
  Investing activities 
  Payments for intangible assets             (469,362)      (528,278) 
  Payments for tangible assets                 (4,449)        (3,427) 
  Grants received                              174,713         50,824 
---------------------------------------  -------------  ------------- 
  Cash flow from investing activities        (299,098)      (480,881) 
---------------------------------------  -------------  ------------- 
 
  Financing activities 
  Proceeds from issue of share 
   capital                                     975,214      1,315,342 
  Costs associated with the issue 
   of share capital                           (97,521)      (133,827) 
  Proceeds from new long term 
   loans                                       402,447              - 
  Reduction from invoice discounting           (1,992)        (8,743) 
  (Decrease)/Increase in restricted 
   cash balances                                     -        158,138 
  Repayment of loans                           (5,171)        (5,240) 
  Interest paid                               (74,357)       (55,878) 
  Cash flow from financing activities        1,198,620      1,269,792 
---------------------------------------  -------------  ------------- 
 
  Net increase/(decrease) in cash 
   and cash equivalents                      (136,256)      (958,989) 
  Exchange differences                           (407)            210 
 Cash and cash equivalents at 
  the beginning of the year                    763,024      1,721,803 
 
  Cash and cash equivalents at 
   the end of the year                         626,361        763,024 
---------------------------------------  -------------  ------------- 
 
 

COMPANY STATEMENT OF CASH FLOWS FOR THE YEARED 31 DECEMBER 2020

 
 
                                            Year ended     Year ended 
                                           31 December    31 December 
                                                  2020           2019 
                                                   EUR            EUR 
 
  Loss for the period before taxation      (1,367,934)   (12,183,497) 
 
  Adjustments for: 
  Finance Income                              (16,946)       (30,953) 
  Write down of investment in 
   subsidiary                                1,116,716     11,887,213 
  Share option and warrant costs                27,020         27,868 
---------------------------------------  -------------  ------------- 
                                             (241,144)      (299,369) 
 
  Movements in working capital 
  Changes in receivables                           495            913 
  Changes in prepayments                        26,599        (2,743) 
  Changes in loans to subsidiary 
   entity                                       61,161        962,489 
  Changes in trade payables                     35,163        130,795 
  Changes in other payables and 
   provisions                                    4,084              - 
  Cash flow from operations                  (113,642)        792,085 
---------------------------------------  -------------  ------------- 
 
 Investing activities 
  Additional investment in subsidiary 
   undertaking                               (739,317)    (1,673,427) 
  Cash flow from investing activities        (739,317)    (1,673,427) 
---------------------------------------  -------------  ------------- 
 
  Financing activities 
  Proceeds from issue of share 
   capital                                     975,214      1,315,342 
  Costs associated with the issue 
   of share capital                           (97,521)      (133,827) 
  Currency losses during the year              (3,200)              - 
  Cash flow from financing activities          874,493      1,181,515 
---------------------------------------  -------------  ------------- 
 
 Net decrease in cash and cash 
  equivalents                                   21,534        300,173 
 Cash and cash equivalents at 
  the beginning of the year                    521,713        221,540 
 
  Cash and cash equivalents at 
   the end of the year                         543,247        521,713 
---------------------------------------  -------------  ------------- 
 
 

CONSOLIDATED AND COMPANY STATEMENTS OF CHANGES IN EQUITY FOR THE YEARED 31 DECEMBER 2020

 
                           Share                Share      Merger     Foreign      Accumulated            Total 
                         Capital              Premium     reserve    currency           Losses 
                                                                      reserve 
                             EUR                  EUR         EUR         EUR              EUR              EUR 
---------------------  ---------  -------------------  ----------  ----------  ---------------  --------------- 
 Group 
 
 At 1 January 2019       560,859           12,558,434   2,910,866    (21,715)     (13,287,758)        2,720,686 
 
 New shares issued        47,830            1,267,512           -           -                -        1,315,342 
 Costs associated 
  with capital raise           -            (133,827)           -           -                -        (133,827) 
 
 Share option and 
  warrant costs                -                    -           -           -           27,870           27,870 
                       ---------  -------------------  ----------  ----------  ---------------  --------------- 
 Transaction with 
  owners                  47,830            1,133,685           -           -           27,870        1,209,385 
                       ---------  -------------------  ----------  ----------  ---------------  --------------- 
 
 Loss for the year             -                    -           -           -      (3,078,909)      (3,078,909) 
 Other comprehensive 
  gains                        -                    -           -       3,085                -            3,085 
                       ---------  -------------------  ----------  ----------  ---------------  --------------- 
 Total comprehensive 
  loss                         -                    -           -       3,085      (3,078,909)      (3,075,824) 
                       ---------  -------------------  ----------  ----------  ---------------  --------------- 
 
 At 31 December 
  2019                   608,689           13,692,119   2,910,866    (18,630)     (16,338,797)          854,247 
 
 New shares issued        66,975              908,239           -           -                -          975,214 
 Costs associated 
  with capital raise           -             (97,521)           -           -                -         (97,521) 
 Share option and 
  warrant costs                -                    -           -           -           27,020           27,020 
                       ---------  -------------------  ----------  ----------  ---------------  --------------- 
 Transaction with 
  owners                  66,975              810,718           -           -           27,020          904,713 
                       ---------  -------------------  ----------  ----------  ---------------  --------------- 
 
 Loss for the year             -                    -           -           -      (1,340,168)      (1,340,168) 
 Other comprehensive 
  gains/(loss)                 -                    -           -      22,585                -           22,585 
---------------------  ---------  -------------------  ----------  ----------  ---------------  --------------- 
 Total comprehensive 
  loss                         -                    -           -      22,585      (1,340,168)      (1,317,583) 
---------------------  ---------  -------------------  ----------  ----------  ---------------  --------------- 
 At 31 December 
  2020                   675,664           14,502,837   2,910,866       3,955     (17,651,945)          441,377 
---------------------  ---------  -------------------  ----------  ----------  ---------------  --------------- 
 
 Company 
 
 At 1 January 2019       560,859           12,558,434     658,279     (7,746)      (1,891,110)       11,878,716 
 
 New shares issued        47,830            1,267,512           -           -                -        1,315,342 
 Costs associated 
  with capital raise           -            (133,827)           -           -                -        (133,827) 
 Share option and 
  warrant costs                -                    -           -           -           27,868           27,868 
                       ---------  -------------------  ----------  ----------  ---------------  --------------- 
 Transaction with 
  owners                  47,830            1,133,685           -           -           27,868        1,209,383 
                       ---------  -------------------  ----------  ----------  ---------------  --------------- 
 
 Loss for the year             -                    -           -           -     (12,183,497)     (12,183,497) 
                       ---------  -------------------  ----------  ----------  ---------------  --------------- 
 Total comprehensive 
  loss                         -                    -           -           -     (12,183,497)     (12,183,497) 
                       ---------  -------------------  ----------  ----------  ---------------  --------------- 
 
 At 31 December 
  2019                   608,689           13,692,119     658,279     (7,746)     (14,046,739)          904,602 
 
 New shares issued        66,975              908,239           -           -                -          975,214 
 Costs associated 
  with capital raise           -             (97,521)           -           -                -         (97,521) 
 Share option and 
  warrant costs                -                    -           -           -           27,020           27,020 
                       ---------  -------------------  ----------  ----------  ---------------  --------------- 
 Transaction with 
  owners                  66,975              810,718           -           -           27,020          904,713 
                       ---------  -------------------  ----------  ----------  ---------------  --------------- 
 
 Loss for the year             -                    -           -           -      (1,367,934)      (1,367,934) 
---------------------  ---------  -------------------  ----------  ----------  ---------------  --------------- 
 Total comprehensive 
  loss                         -                    -           -           -      (1,367,934)      (1,367,934) 
---------------------  ---------  -------------------  ----------  ----------  ---------------  --------------- 
 At 31 December 
  2020                   675,664           14,502,837     658,279     (7,746)     (15,387,653)          441,381 
---------------------  ---------  -------------------  ----------  ----------  ---------------  --------------- 
 

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARED 31 DECEMBER 2020

   1.    General information 

The Company is a public limited company domiciled in the United Kingdom and incorporated under registered number 09024532 in England and Wales. The Company's registered office is 3 More London Riverside, London, SE1 2AQ.

The Group was formed when the Company acquired on 29 August 2014 the entire share capital of Windar Photonics A/S, a company registered in Denmark through the issue of Ordinary Shares.

   2.    Adoption of new and revised International Financial Reporting Standards 

New and amended standards adopted by the Group

There are no IFRSs or IFRIC interpretations that are effective for the first time for the financial year

beginning on or after 1 January 2020 that would be expected to have a material impact on the Group.

The new IFRSs adopted during the year areas as follows:

 
             Amendments to References to the Conceptual Framework in IFRS 
              Standards 
             Amendments to IFRS 3         Definition of a Business 
             Amendments to IFRS 9, IAS    Interest Rate Benchmark Reform 
              39 and IRFS 7 
             Amendments to IAS 1 & IAS    Definition of Material 
              8 
             IFRS 16                      Covid-19-Related Rent Concessions 
 

The adoption of the new and amendments to IFRSs did not have any significant impact on the financial

statements of the Group and the Company.

The following standards, amendments and interpretations applicable to the Group are in issue but are not

yet effective and have not been early adopted in these financial statements. They may result in

consequential changes to the accounting policies and other note disclosures. We do not expect the impact

of such changes on the financial statements to be material. These are outlined in the table below:

 
                                                             Effective dates 
                                                               for financial 
                                                             periods beginning 
                                                                on or after 
                                                          --------------------- 
 IFRS 17               Insurance Contracts                   1 January 2023 
 Amendments to         Classification of Liabilities         1 January 2022 
  IAS 1                 as Current or Non-current 
 Annual Improvements   Amendments to IFRS 1                  1 January 2022 
  to IFRS Standards     Amendments to IFRS 9 
  2018-2020             Amendments to IFRS 16 
                        Amendments to IAS 41 
 Amendments to         Business Combinations - Reference     1 January 2022 
  IFRS 3                to the Conceptual Framework 
 Amendments to         Property, Plant and Equipment         1 January 2022 
  IAS 16                - Proceeds before Intended Use 
 Amendments to         Onerous Contracts - Cost of           1 January 2022 
  IAS 37                Fulfilling 
 Amendments to         Sale or Contribution of Assets        Deferred until 
  IFRS 10 and IAS       between an Investor and its          further notice 
  28                    Associate or Joint Venture 
 
 

The Directors anticipate that the adoption of these standards and the interpretations in future periods will

have no material impact on the financial statements of the Group.

   3.    Going Concern 

The consolidated financial statements have been prepared assuming the Group will continue as a going concern. Under the going concern assumption, an entity is anticipated to continue in business for the foreseeable future with neither the intention nor the necessity of liquidation, ceasing trading or seeking protection from creditors pursuant to laws or regulations.

Based on the Group's latest trading expectations and associated cash flow forecasts, the directors have considered the cash requirements of the Group. The directors are confident that based on the Group's forecasts and projections, taking account of possible changes in trading performance is appropriate to continue to adopt the going concern basis of accounting in preparing these financial statements.

However, Management has noticed the risk of non-payments from customer receivables and the potential for future projects/customer delivery schedules to be delayed due to the general COVID-19 pandemic, which could have a material impact on the outlooking cash flow forecasts.

In the event, for the reasons stated above the timing of the forecast revenue and customer payments were not to be achieved in the periods expected, the Group may need to seek additional funding to cover those periods where there might be a potential shortfall. However, in order to cover any such eventual shortfalls a major shareholder of the Company has already committed to supporting the Company if required for at least 12 months from the date that these financial statements are signed.

Due to primarily the above stated uncertainties regarding the COVID-19 situation, Management highlight the very high levels of uncertainties, which indicates the existence of a material uncertainty which may cast significant doubt about the Group's ability to continue as a going concern and therefore it may be unable to realise its assets and discharge its liabilities in the normal course of business. The financial statements do not include the adjustments that would result if the Group was unable to continue as a going concern.

   4.    Accounting policies 

Basis of preparation

The consolidated financial statements comprise the consolidated financial information of the Group as at 31 December 2020 and are prepared under the historic cost convention, except for the following:

   --      share based payments and share option and warrant costs 

The financial statements have been prepared in accordance with International Financial Reporting Standards, International Accounting Standards and Interpretations (collectively "IFRSs") issued by the International Accounting Standards Board (IASB) as adopted by the European Union ("adopted IFRSs").

The acquisition of the subsidiary in 2014 was deemed to be a business combination under common control as the ultimate control before and after the acquisition was the same. As a result, the transaction is outside the scope of IFRS 3 and has been included under the principles of merger accounting by reference to UK GAAP.

   5.    Revenue 
 
 Revenue from contracts with customers:      Year ended     Year ended 
                                            31 December    31 December 
                                                   2020           2019 
                                                    EUR            EUR 
 Sale of product and installation             1,325,951      1,129,255 
 Rendering of services                            8,005         48,642 
                                          -------------  ------------- 
 
 Revenue                                      1,333,956      1,177,897 
                                          =============  ============= 
 

Disaggregation of revenue

The disaggregation of revenue from contracts with customers is as follows:

 
                            Year ended     Year ended 
                           31 December    31 December 
                                  2020           2019 
                                   EUR            EUR 
 WindEye(TM)                   770,531      1,070,231 
 WindVision(TM)                555,420         59,018 
                         -------------  ------------- 
 Rendering of services           8,005         48,648 
                         -------------  ------------- 
 
 Revenue                     1,333,956      1,177,897 
                         =============  ============= 
 

Contract liabilities of EUR215,905 (2019: EUR69,954) relates to performance obligation under contracts that have not yet been completed and are expected to be met in 2021.

   6.    Loss from operations 
 
 Loss from operations 
  is stated after: 
                                             Year ended          Year ended 
                                       31 December 2020    31 December 2019 
                                                    EUR                 EUR 
 Staff costs                                  1,263,759           1,579,160 
 Expensed research 
  and development costs                         489,375             488,593 
 Amortisation(1)                                286,903             267,317 
 Depreciation                                    38,752              52,411 
 Lease payments                                 115,350             131,989 
 Other Operating Income                        (32,196)            (32,145) 
 Remuneration received 
  by the Group's auditor 
  or associates of 
  the Group's auditor: 
       - Audit of parent 
        company                                   5.133               5,460 
       - Audit of consolidated 
        financial statements 
        - Taxation compliance                    18,120              19,185 
        services 
        Other auditors:                             830               7,357 
       - Audit of overseas 
        subsidiaries                             18,803              21,430 
       -Adjustment to prior 
        year audit of consolidated 
        financial statements                     35,715              42,899 
 
 

(1) Amortisation charges on the Group's intangible assets are recognised in the administrative expenses line item in the consolidated statement of comprehensive income.

   7.    Segment information 

Operation segments are reported as reported to the chief operation decision maker.

The Group has one reportable segment being the sale of LiDAR Wind Measurement and therefore segmental results and assets are disclosed in the consolidated income statement and consolidated statement of financial position.

In 2020, four customers accounted for more than 10 per cent of the revenue each (2019: three customers). The total amount of revenue from these customers amounted to EUR1,076,841, 81 per cent of the total revenue (2019: EUR1,028,380 or 88 per cent of the revenue)

Revenue by geographical location of customer:

 
                                   Year                        Year 
                                  ended                       ended 
                            31 December                 31 December 
                                   2020                        2019 
                                    EUR                         EUR 
 Europe                         119,340                     256,501 
 Americas                        54,218                           - 
 China                        1,128,722                     919,658 
 Asia (excluding China)          31,676                       1,738 
 Revenue                      1,333,956                   1,177,897 
------------------------  -------------  -------------------------- 
 

Geographical information

The parent company is based in the United Kingdom. The information for the geographical area of non-current assets is presented for the most significant area where the Group has operations being Denmark.

 
            As at 31 December   As at 31 December 
                         2020                2019 
                          EUR                 EUR 
 
 Denmak             1,248,460           1,270,753 
                    1,248,460           1,270,753 
           ------------------  ------------------ 
 
 

Non-current assets for this purpose consist of property, plant and equipment and intangible assets.

   8.    Directors and employees 
 
                                     2020                 2019 
                                  Average   Year end   Average   Year end 
 Number of employees excluding 
  directors 
 Sales and Services                     7          6         8          8 
 Research and development              10         10        11         11 
 Production                             2          2         3          3 
 Administration                         3          3         3          3 
                                 --------  ---------  --------  --------- 
 
                                       22         21        25         25 
                                 ========  =========  ========  ========= 
 
 
 
 Group                              2020        2019 
                                     EUR         EUR 
 Staff costs 
 Wages and salaries            1,190,757   1,465,035 
 Social security costs            45,982      86,257 
                              ----------  ---------- 
                               1,236,739   1,551,292 
 
 Warrant and Option costs         27,020      27,868 
                              ----------  ---------- 
 
                               1,263,759   1,579,160 
                              ==========  ========== 
 
 
                                    2020        2019 
   Company 
                                     EUR         EUR 
 Staff costs 
 Wages and fees                   25,760      40,448 
                                  25,760      40,448 
 
 Warrant and Option costs         27,020      27,868 
                              ----------  ---------- 
 
                                  52,780      68,316 
                              ==========  ========== 
 

The Company has 3 employees (2019: 4), all being the Directors of the Company.

Key management personnel compensation

Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of Group, and are considered to be directors of the company.

The value of all elements of remuneration received by key management in the year was as follows:

 
                            Wages and   Fair value       Pension       Total 
                             salaries    of warrant    contributions 
                             and fees      costs 
                                  EUR           EUR              EUR      EUR 
 Year ended 31 December 
  2020 
 Directors                     25,760             -                -   25,760 
                           ==========  ============  ===============  ======= 
 
 Year ended 31 December 
  2019 
 Directors                     40,448             -                -   40,448 
                           ==========  ============  ===============  ======= 
 
   9.             Finance income and expense 
 
 
 Finance expense 
                                                             Year              Year 
                                                            ended             ended 
                                                      31 December       31 December 
                                                             2020              2019 
                                                              EUR               EUR 
 Foreign exchange losses                                 (32,746)        (39,124) 
 Interest expense on financial liabilities 
  measured at amortised cost                            (110,364)         (151,765) 
 Finance expense                                        (143,110)         (190,889) 
-------------------------------------------------  --------------  ---------------- 
 
 

10. Income tax

 
                                                      Year ended     Year ended 
                                                     31 December    31 December 
                                                            2020           2019 
 (a)    The tax credit for the year:                         EUR            EUR 
        UK Corporation tax                                     -              - 
  Foreign tax credit                                   (252,517)      (212,488) 
                                                   -------------  ------------- 
 
 (b)    Tax reconciliation 
  Loss on ordinary activities before 
   tax                                               (1,592,685)    (3,291,397) 
                                                   =============  ============= 
 
  Loss on ordinary activities at the 
   UK standard rate of corporation tax 
   19% (2019: 19%)                                     (302,610)      (625,365) 
        Effects of: 
  Expenses non-deductible for tax purposes              (35,103)          3,108 
        Adjustment to not recognized deferred          (137,902)              - 
         taxes in previous periods 
  Unrecognised tax losses                                263,464        533,772 
  Different tax rates applied in overseas 
   jurisdictions                                        (54,860)      (125,599) 
  Exchange rate differences                               14,494          1,596 
 ------------------------------------------------  -------------  ------------- 
  Tax credit for the year                              (252,517)      (212,488) 
 ------------------------------------------------  -------------  ------------- 
 

The tax credit is recognised as 22 per cent. (2019: 22 per cent) of the company's deficit that relates to research and development costs. Companies in Denmark, who conduct research and development and accordingly experience deficits can apply to the Danish tax authorities for a payment equal to 22 per cent. (2019; 22 per cent) of deficits relating to research and development costs up to DKK 25 million.

(c) Deferred tax - Group

In view of the tax losses carried forward and other timing differences there is a deferred tax asset of approximately EUR2,829,139 (2019: EUR2,549,025) which has not been recognised in these Financial Statements, given uncertainty around timing and availability of sufficient taxable profits in the relevant Company.

(d) Deferred tax - Company

In view of the tax losses carried forward and other differences there is a deferred tax asset of approximately EUR338,140 (2019: EUR281,199) which has not been recognised in these Financial Statements, given uncertainty around timing and availability of future profit against which the losses will be able to be used.

All taxes recognized in the statement of Comprehensive income are denominated in DKK.

11. Loss per share

The loss and weighted average number of ordinary shares used in the calculation of basic loss per share are as follows:

 
                                               Year ended     Year ended 
                                               31 December    31 December 
                                                  2020           2019 
                                                  EUR            EUR 
 Loss for the year                             (1,317,583)    (3,078,909) 
                                             -------------  ------------- 
 
 Weighted average number of ordinary 
  shares for the purpose of basic earnings 
  per share                                     49,819,356     45,614,917 
 Basic loss and diluted, cents per share             (2.7)          (6.7) 
                                             -------------  ------------- 
 

There is no dilutive effect of the warrants (note 25) as the dilution would reduce the loss per share.

12. Dividends

No dividends were proposed by the Group during the period under review (2019: EURNil).

13. Investment in Subsidiaries

 
                                         EUR 
 Company 
 At 1 January 2020                   519,897 
 Capital contribution 
  in the year                        739,316 
  Write down investment 
   in subsidiary                 (1,116,716) 
                               ------------- 
 As at 31 December 
  2020                               142,497 
                               ------------- 
 

The subsidiaries of Windar Photonics Plc are included in these financial statements in accordance with the merger accounting as set out in the basis of preparation and basis of consolidation in notes 4 and 5, are as follows:

 
 Name                    Country        Ownership      Registered Office      Nature of business 
                     of incorporation 
 Windar Photonics        Denmark                       Helgeshoej Allé          Develop and 
  A/S                                      100%        16-18,2630 Taastrup,        commercialise 
                                                                    Denmark         wind turbine 
                                                                                      technology 
 Windar Photonics         China           100%      Room 403-03, Building          Commercialise 
  (Shanghai) Co.                         indirect    #2, No. 38 Debao               wind turbine 
  Ltd.                                               Road, Pudong, Shanghai           technology 
 

The Company owns 100 per cent. of the issued share capital of Windar Photonics A/S (comprising A Shares of DKK 5,737,800 of 1 DKK each and B Shares of DKK 3,642,592 of 1 DKK each) with CVR number 32157688.

Windar Photonics A/S was incorporated on 28 December 2008 in Denmark and acquired by the Company in August 2014. During the year the Company invested the funds received from the share placing into its main trading subsidiary, Windar Photonics A/S, and a total transfer of funds of EUR678,156 was made during the year. A further waiver of intercompany receivable due from Windar Photonics A/S of EUR739,317 was made during the year and treated as capital contribution.

Windar Photonics A/S owns 100 per cent. of the issued common stock of Windar Photonics (Shanghai) Co.,Ltd. Windar Photonics (Shanghai) Co. Ltd. was incorporated on 18 May 2016 in China with a registered capital of USD 200,000 of which USD 200,000 is paid in as per 31 December 2020.

14. Intangible assets

 
                                       Development 
                                          projects 
 Group                                         EUR 
 Cost 
----------------------------------    ------------ 
 At 1 January 2019                       2,989,095 
------------------------------------  ------------ 
 Additions - internally developed          528,277 
 Grants received                          (50,824) 
 Exchange differences                      (1,190) 
 At 31 December 2019                     3,465,358 
------------------------------------  ------------ 
 Additions - internally developed          469,362 
 Grants received                         (174,713) 
 Exchange differences                       14,759 
------------------------------------  ------------ 
 At 31 December 2020                     3,774,766 
------------------------------------  ------------ 
 Accumulated amortisation 
 At 1 January 2019                       2,006,207 
------------------------------------  ------------ 
 Charge for the year                       267,317 
 Exchange differences                        (773) 
------------------------------------  ------------ 
 At 31 December 2019                     2,272,751 
------------------------------------  ------------ 
 Charge for the year                       286,903 
 Exchange differences                        9,869 
------------------------------------  ------------ 
 At 31 December 2020                     2,569,523 
------------------------------------  ------------ 
 Net carrying value 
----------------------------------    ------------ 
 At 1 January 2019                         982,888 
------------------------------------  ------------ 
 At 31 December 2019                     1,192,607 
------------------------------------  ------------ 
 At 31 December 2020                     1,205,243 
------------------------------------  ------------ 
 

The Group has received public Research and Development Grants of EUR174,713 (2019: EUR50,824) in respect of the capitalised research and development. At the end of the year 3 development projects are ongoing which are supported by public Research and Development Grants and outstanding grants which can be claimed in the coming two years amount to EUR669,605 (2019: EUR508,722, which could be claimed in the following 3 years).

The company's development projects relate to the development of improved performance and functionality, improved components etc. in the company's products.

Measurement of the development projects are based on realization of the company's business plan and budgets,

particularly realization of expected growth in revenue.

15. Property, plant & equipment

 
                                Plant and 
                                equipment 
 Group                                EUR 
 Cost 
--------------------------    ----------- 
 At 1 January 2019                218,341 
----------------------------  ----------- 
 Additions                          3,427 
 Disposed                               - 
 Exchange differences                (79) 
 At 31 December 2019              221,689 
 Additions                          4,449 
 Disposed                               - 
 Exchange differences                 771 
----------------------------  ----------- 
 At 31 December 2020              226,909 
----------------------------  ----------- 
 Accumulated depreciation 
 At 1 January 2019                107,553 
----------------------------  ----------- 
 Charge for the year               52,411 
 Disposed                               - 
 Exchange differences                (75) 
 At 31 December 2019              159,889 
 Charge for the year               38,752 
 Disposed                               - 
 Exchange differences                 570 
----------------------------  ----------- 
 At 31 December 2020              199,211 
----------------------------  ----------- 
 Net carrying value 
--------------------------    ----------- 
 At 1 January 2019                110,788 
----------------------------  ----------- 
 At 31 December 2019               61,800 
----------------------------  ----------- 
 At 31 December 2020               27,698 
----------------------------  ----------- 
 

16. Inventory

 
                                Group 
                        As at          As at 
                      31 December    31 December 
                         2020           2019 
                              EUR            EUR 
 Raw material              16,145        417,481 
 Work in progress         181,598        392,374 
 Finished goods           439,042        209,709 
------------------  -------------  ------------- 
 Inventory                636,785      1,019,564 
------------------  -------------  ------------- 
 
 

The cost of inventory sold and recognised as an expense during the year was EUR655,086 (2019: EUR639,555).

17. Trade and other receivables

 
                                                 Group                        Company 
                                             As at          As at          As at          As at 
                                       31 December    31 December    31 December    31 December 
                                              2020           2019           2020           2019 
                                               EUR            EUR            EUR            EUR 
 Trade receivables                       1,301,858        623,458              -              - 
-----------------------------------  -------------  -------------  -------------  ------------- 
 Less; provision for impairment 
  of trade receivables                   (872,617)      (511,755)              -              - 
 Trade receivables - net                   429,241        111,703              -              - 
 Receivables from related 
  parties                                        -              -          2,074         43,088 
-----------------------------------  -------------  -------------  -------------  ------------- 
 
 Total financial assets other 
  than cash and cash equivalents 
  classified at amortised costs            429,241        111,703          2,074         43,088 
-----------------------------------  -------------  -------------  -------------  ------------- 
 
 
 Tax receivables                           253,030        212,428              -              - 
 
 Other receivables                         220,047         84,305         11,295         11,790 
 Total other receivables                   473,077        296,733         11,295         11,790 
 Total trade and other receivables         902,318        408,436         13,369         54,878 
-----------------------------------  -------------  -------------  -------------  ------------- 
 
 Classified as follows: 
 Current Portion                           902,318        408,436         13,369         54,878 
-----------------------------------  -------------  -------------  -------------  ------------- 
 
 

The carrying value of trade and other receivables classified at amortised cost approximates fair valu e.

 
 
   More than   More than   More than   Total 
     30 days     60 days    120 days 
    past due    past due    past due 
         EUR         EUR         EUR     EUR 
 

Gross carrying amount 1,210 - 904,645 905,855

Loss provision - - (872,617) (872,617)

Net carrying amount 1,210 - 32,028 33,238

Trade and other receivables represent financial assets and are considered for impairment on an expected credit loss model. These assets have historically had immaterial levels of bad debt and are with credit worthy customers, and as the Group trades with a concentrated number of customers and utilises export credit facilities the Group has reviewed trade receivables on an individual basis. Additionally, the Group continues to trade with the same customers and therefore the future expected credit losses have been considered in line with the past performance of the customers in the recovery of their receivables. The implementation of IFRS 9 has therefore not resulted in a change to the impairment provision in the current or prior year.

The Group applies the IFRS 9 simplified approach to measuring expected credit losses using a lifetime expected credit loss provision for trade receivables. The expected loss rates are based on the Group's historical credit losses experienced over the three year period prior to the period end. The historical loss rates are then adjusted for current and forward-looking information on factors affecting the Group's customers including the area of operations of

those debtors and the advancing market for wind power and the Group's products. The assessment of the expected credit risk for the year has not increased, when looking at the factors affecting the risk noted above.

There is no material difference between the net book value and the fair values of trade and other receivables due to their short-term nature.

Other classes of financial assets included within trade and other receivables do not contain impaired assets.

Of the net trade receivables EURNil (2019: EUR49,750) was pledged as security for the invoice discounting facility. The Group is committed to underwrite any of the debts transferred and therefore continues to recognise the debts sold within trade receivables until the debtors repay or default. Since the trade receivables continue to be recognised, the business model of the Group is not affected. The proceeds from transferring the debts of are included in other financial liabilities until the debts are collected or the Group makes good any losses incurred by the service provider.

18. Cash and cash equivalents

For the purpose of the cash flow statement, cash and cash equivalents comprise the following balances with original maturity less than 90 days:

 
 
                            Group                        Company 
                        As at          As at          As at          As at 
                  31 December    31 December    31 December    31 December 
                         2020           2019           2020           2019 
                          EUR            EUR            EUR            EUR 
                -------------  -------------  -------------  ------------- 
 
 Cash at bank         626,361        763,024        543,247        521,713 
                -------------  -------------  -------------  ------------- 
 

The Group has restricted cash balances of EUR33,672 (2019: EUR 360,000) but a provision of the full amount was made in 2019 and carried over into 2020. The restricted cash balances relate to transactions entered into between the Group and external financial parties. When EKF has credit approved a customer EKF, issues a non-recourse payment guarantee to an external financial party typically of 80% to 90% of the face value of the transaction. Upon shipment of the products, the Group then sells the invoice to the external financial party at face value subject to depositing and pledging a cash amount equal to the difference between the face value of the invoice and the EKF guarantee. When the customer pays typically one year later, the full invoice amount to the financial party, the deposit is paid in full to the Group.

19. Notes supporting statement of cash flows

 
                                 Non-current     Current loans 
                                   loans and    and borrowings         Invoice         Total 
                                  borrowings               EUR     discounting           EUR 
                                         EUR                               EUR 
 As at 1 January 2019              1,135,744             5,240          10,735     1,151,719 
 Repayment of loans                        -           (5,240)               -       (5,240) 
 Repayment of Invoice 
  Discounting                                                          (8,743)       (8,743) 
 Accrued interests on 
  non-current loans                  135,011                 -                       135,011 
 Loans and borrowings 
  classified as non-current 
  in previous period becoming 
  current in this period         (1,265,059)         1,265,059               -             - 
 Foreign exchange rate 
  differences                          (522)                 -               -         (522) 
 
 
   As at 31 December 2019              5,174         1,265,059           1,992     1,272,225 
------------------------------  ------------  ----------------  --------------  ------------ 
 
 Repayment of loans                        -           (5,171)               -       (5,171) 
 Repayment of Invoice 
  Discounting                              -                 -         (1,992)       (1,992) 
 Loans and borrowings 
  classified as non-current 
  in previous period becoming 
  current in this period            (22,128)            22,128               -             - 
 Accrued interests on 
  non-current loans                   68,753                 -               -        68,753 
 Loans and borrowings 
  classified as current 
  in previous period becoming 
  non-current in this period       1,262,084       (1,262,084)               -             - 
 New long term borrowings 
  in the period                      402,447                 -               -       402,447 
 Foreign exchange rate 
  differences                          3,495             2,241               -         5,736 
------------------------------  ------------  ----------------  --------------  ------------ 
 
 As at 31 December 2020            1,719,825            22,173               -     1,741,998 
------------------------------  ------------  ----------------  --------------  ------------ 
 

20. Trade and other payables

 
                                                          Group                                      Company 
                                        As at                                      As at          As at          As at 
                                  31 December                                31 December    31 December    31 December 
                                         2020                                       2019           2020           2019 
                                          EUR                                        EUR            EUR            EUR 
 Invoice discounting                        -                                      1,992              -              - 
 Trade payables                       726,007                                  1,045,792        233,648        198,485 
 Other payables and accruals          274,202                                    211,879         24,084         20,000 
 Current portion of Nordea 
  and Growth Fund loans                22,173                                  1,265,059              -              - 
 Total financial liabilities, 
 excluding 'non-current' loans                                                 2,524,722 
 and borrowings classified          1,022,382                                                   257,732        218,485 
 as financial liabilities 
 measured 
 at amortised cost 
------------------------------  -------------  -----------------------------------------  -------------  ------------- 
 Contract liabilities                 215,905                                     69,954              -              - 
------------------------------  -------------  -----------------------------------------  -------------  ------------- 
 Total trade and other 
  payables                          1,238,287                                  2,594,676        257,732        218,485 
------------------------------  -------------  -----------------------------------------  -------------  ------------- 
 
 Classified as follows: 
 Current Portion                    1,238,287                                  2,594,676        257,732        218,485 
------------------------------  -------------  -----------------------------------------  -------------  ------------- 
 
 

The invoice discounting arrangement was secured upon the trade debtors to which the arrangement relates.

There is no material difference between the net book value and the fair values of current trade and other payables due to their short-term nature.

21. Borrowings

The carrying value and fair value of the Group's borrowings are as follows:

 
                                                       Group 
                                                 Carrying and Fair 
                                                       value 
                                                   As at          As at 
                                             31 December    31 December 
                                                    2020           2019 
 Loans                                               EUR            EUR 
 Growth Fund                                   1,736,802      1,259,499 
 Current portion of Growth Fund                 (16,977)    (1,259,499) 
 Nordea Ejendomme                                  5,196         10,734 
 Current portion of Nordea Loan                  (5,196)       (5, 560) 
-----------------------------------------  -------------  ------------- 
 Total non-current financial liabilities 
  measured at amortised costs                  1,719,825          5,174 
-----------------------------------------  -------------  ------------- 
 

The Growth Fund borrowing from the Danish public institution, Vækstfonden, initially bore interest at a fixed annual rate of 12 per cent with a full bullet repayment in June 2020. As announced in 2020 terms for the borrowing was renewed during the year whereafter the interest rate was reduced to 7 percent p.a. and the loan to be repaid in quarterly instalments over the period from 1 January, 2022 until 1 October, 2026. A new Covid-19 loan was further obtained during the year from Vækstfonden which carries an interest rate of CIBOR plus 5 percent p.a. and to be repaid in quarterly instalments over the period from 1 October 2021 until 1 October 2026.

In relation with the changes to the existing Growth Fund borrowing and the new offered loan, the lender now has security of the assets of Windar Photonics A/S, subsidiary undertaking, to an amount of DKK12.6m. In relation to the additional Covid-19 loan the following terms and conditions are in place:

   --      There is an early exit fee set at a maximum DKK600k 

-- No dividends or corporate bond interest will be paid. D ividend distributions from Windar Photonics A/S to Windar Photonics PLC has been restricted until full repayment of the borrowing to the Growth Fund.

-- No payment of inter-company debts from Windar Photonics A/S. Windar Photonics PLC has entered into an agreement to resign from repayments of any outstanding amounts owned by Windar Photonics A/S to Windar Photonics PLC until full repayment of the borrowing to the Growth Fund.

-- The loan is secured up to a value of DKK12.6m on certain assets of Windar Photonics A/S, subsidiary undertaking.

The loan from Nordea Ejendomme is in respect of amounts included in the fitting out of the offices in Denmark. The loan is repayable over the 6 years and matures in November 2021 and carries a fixed interest rate of 6 per cent.

Both loans are denominated in Danish Kroner.

The Company had no borrowings.

 
 
 
 

22. Share capital

On 3 January and 8 January 2020 the company issued 1,166,363 ordinary shares of 1 pence each for a cash consideration at GBP0.275 per share. On 23 December 2020 the company issued 4,844,444 ordinary shares of 1 pence each for a cash consideration of GBP0.1125 per share. On 12 December 2019 the company issued 4,076,348 ordinary shares of 1 pence each for cash consideration at GBP0.275 per share.

 
                                   Authorised        EUR   Authorised       EUR 
 
                                         2020       2020         2019      2019 
 
 Shares at beginning 
  of reporting period              48,584,717    608,689   44,508,369   560,859 
-------------------------------  ------------  ---------  -----------  -------- 
 Issue of share capital             6,010,807     66,975    4,076,348    47,830 
-------------------------------  ------------  ---------  -----------  -------- 
 Shares at end of reporting 
  period                           54,595,524    675,664   48,584,717   608,689 
-------------------------------  ------------  ---------  -----------  -------- 
 
 
 
                               Number of                   Number of 
                           shares issued               shares issued 
                               and fully                   and fully 
                                    paid        EUR             paid        EUR 
                                    2020       2020             2019       2019 
 
 Shares at 1 January 
  2019                        48,584,717    608,689       44,508,369    560,859 
-----------------------  ---------------  ---------  ---------------  --------- 
 
 Issue of shares for 
  cash                         6,010,807     66,975        4,076,348     47,830 
 
 Shares at 31 December 
  2019                        54,595,524    675,664       48,584,717    608,689 
-----------------------  ---------------  ---------  ---------------  --------- 
 

At 31 December 2020 the share capital comprises 54,595,524 shares of 1 pence each.

Warrants and share options

Warrants and share options are granted to Directors and employees.

No new share options or warrants were granted in 2020

Share options issued in 2017 and 2019 are valued using the Black-Scholes pricing model and no performance conditions are included in the fair value calculations. The options were issued at a strike price of GBP1 a third vesting on each anniversary for the first three years whereafter the options have a 10-year life. The price of the share at the time of issue was GBP0.88. The risk-free rate was 1.15%. The expected volatility is based on historical volatility of the AIM market over the last two years and is estimated to be 40%.

The average share price during the year was 22.42 pence (2019: 50.00 pence). At the year end the Company had the following warrants and options outstanding:

 
                                                 Number of 
                                                  warrants 
                                                and options 
                                           -------------------- 
                   At                                        At 
               31 December                          31 December      Exercise 
                                                                        price 
                  2019       Granted      Lapsed           2020   (GBP pence)     Exercise date 
 
                                                                                    31/12/19 to 
   Warrants      1,520,956         -           -      1,520,956         39.07          31/12/21 
                                                                                    16/11/18 to 
    Options        557,500         -           -        557,500        100.00          01/03/32 
                 2,078,456         -           -      2,078,456 
===========  =============  ========  ==========  ============= 
 
 The number of options and warrants exercisable at 31 December 
  2020 is warrants 1,520,956 (2019: 1,520,956) and options 
  460,000 (2019: 241,666). 
 
  The weighted average remaining contractual life for the options 
  outstanding as at 31 December 2020 is 9.76 years (2019: 10.76 
  years). 
  The warrants have a remaining life of one year (2019: 2 years). 
 
 
 

23. Reserves

The following describes the nature and purpose of each reserve within equity

 
 Reserve                    Description and purpose 
 
 Share premium              Amount subscribed for share capital 
                             in excess of nominal value. 
 Merger reserve - Group     Represents the difference between 
                             the consideration paid for the 
                             acquisition of Windar Photonics 
                             A/S by the Company and the net 
                             book value of the assets and 
                             liabilities acquired. 
 Merger reserve - Company   Represents the difference between 
                             the fair value and the nominal 
                             value of the shares issued for 
                             the acquisition of Windar Photonics 
                             A/S. 
 Foreign currency reserve   Gains and losses on the retranslating 
                             the net assets from the functional 
                             currencies to the reporting currency 
                             of EUR. 
 Retained earnings          All other net gains and losses 
                             and transactions with owners 
                             (e.g. dividends) not recognised 
                             elsewhere. 
 

24. Operating Leases

The total future value of the minimum lease payment is due as follows:

 
                                    2020     2019 
                                     EUR      EUR 
 Not later than one year          41,879   75,967 
 Later than one year and not           -        - 
  later than five years 
                                  41,879   75,967 
                                 -------  ------- 
 
 

All leasing commitments are in respect of property and cars leased by the Group. The terms of property leases vary from country to country, although they all tend to be tenant repairing with rent reviews once a year. The Company has not entered any leases in 2020 with maturity longer than 6 months.

25. Warranty provision

 
                                          2020      2019 
                                           EUR       EUR 
 Provision at the beginning 
  of reporting period                   61,170    78,422 
 Provision charged to the profit 
  and loss account                    (22,500)   (9,995) 
 Utilised in year                            -   (7,240) 
 Foreign exchange rate movements         (177)      (17) 
                                     ---------  -------- 
                                        38,493    61,170 
                                     ---------  -------- 
 

The Group typically provides a two-year warranty period to customers on products sold. Warranty expenses/(income) charged to the Statement of Comprehensive Income amounted to EUR(22,500) (2019: (EUR9,995)) corresponding to a warranty cost percentage of Nil % (2019: 0.4%) relative to the prior two years revenue. However, d ue to the early business stage of the Group and the uncertainty following this the Group has adopted a policy to accrue a 4% provision based on the prior two years deliveries calculated with the cost of goods sold at the end of the period.

26. Related Party Transactions

Jørgen Korsgaard Jensen and Johan Blach Petersen are directors and shareholders of Wavetouch Denmark A/S (Wavetouch) and OPDI Technologies A/S (OPDI). Wavetouch has during the year rented office space from Windar Photonics A/S, the amount payable during the year to Windar was EUR32,196 (2019: EUR32,145). There were amounts outstanding at the year end to Wavetouch EUR(23,630) (2019: EUR167,527). At the end of the year there were amounts outstanding to OPDI of EUR Nil (2019: EUR nil). At the end of the year there were amounts outstanding to Directors of EUR 65,696 (2019: EUR 39,936).

Intercompany transactions

 
 At 31 December 2020 there exist an intercompany loan between 
  Windar Photonics PLC and its subsidiary Windar Photonics 
  A/S. 
  Windar Photonics PLC has a receivable at EUR 2,074 (2019: 
  EUR43,088). Interest added during 2020 amounts to EUR20,147 
  (2019: EUR35,396). 
  The interest rate for 2020 is Bank of England base rate 
  + 2.5% p.a. (2019: Base rate 0.75% + 2.5% p.a.). 
 

27. Controlling Parties

There is no ultimate controlling party of the Company.

28. Post balance sheet events and outstanding lawsuits

No major post balance sheet events have happened in 2021.

At the end of 2020 the Company had one outstanding lawsuit regarding a dispute with a previous supplier. The company disputes the claim of approximately EUR22,000 made against the company.

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END

FR URRBRABUNOAR

(END) Dow Jones Newswires

June 30, 2021 13:15 ET (17:15 GMT)

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