REG - 4GLOBAL PLC - Final Results for the Year Ended 31 March 2022
07/07/2022 07:16
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RNS Number : 6029R 4GLOBAL PLC 07 July 2022
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS STIPULATED UNDER THE UK
VERSION OF THE MARKET ABUSE REGULATION NO 596/2014 WHICH IS PART OF ENGLISH
LAW BY VIRTUE OF THE EUROPEAN (WITHDRAWAL) ACT 2018, AS AMENDED. ON
PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY INFORMATION SERVICE, THIS
INFORMATION IS CONSIDERED TO BE IN THE PUBLIC DOMAIN.
7 July 2022
4GLOBAL PLC
("4GLOBAL" or the "Company")
Final Results
4GLOBAL, a UK-based data, services and software company focused on major
sporting events and the promotion and measurement of physical activity, is
pleased to announce its audited final results for the year ended 31 March
2022.
Headline results for the year to 31 March 2022
Audited Audited Change %
2022 2021
£'000 £'000
Revenue 3,640 2,679 35.9
Gross profit 2,616 1,827 43.1
Adjusted profit from operations (Note 1) 573 559 2.6
Operating profit before government grant income 573 504 13.6
(Loss)/profit before tax (1,889) 372
Net cash 3,051 775
Note 1: Adjusted profit is defined as statutory (loss)/profit from operations
before depreciation, share based payment expense and exceptional items. See
note 8.
Financial highlights
• Substantial revenue growth reflects successful shift into recurring
subscription income (43% compared to 28% last year). Subscription revenues
were up by 105% in the year whilst consultancy revenues were also up by 8.9%.
• Loss before tax includes £2,072k of exceptional one-off items relating to the
IPO as well as share based payments costs relating to share options granted at
IPO of £170k which are unlikely to recur.
• Year ended with a strong balance sheet to support further rapid growth
• Successful AIM IPO raised £3.2m net of expenses and brought on board
excellent supportive shareholders.
Operational highlights
• Significant progress made in all three growth pillars - international
expansion, "land and expand" and acquisitions.
• Demand for the group's products in Europe and North America continues to grow
along with the data integrations we have started in these market places which
will allow us to develop revenue generating opportunities.
• Since IPO 4GLOBAL had landed a significant number of new clients and expanded
on several key client relationships.
• 4GLOBAL has developed a strong acquisition deal pipeline and is in active
discussions with several potential complementary targets although no
agreements have yet been reached.
• Updated and released editions of both our social value calculator ("SVC")
which helps clients evaluate the social value created from investment in sport
and physical activity and CitiHub which brings together participation data
from active people in a city to help officials plan investment and
intervention to increase activity levels.
• Continued to build the team with new high quality appointments including the
appointment of a Chief Customer Officer in March 2022. The team has been
expanded as we scale up our offering and focus on our ambition to become the
world's leading data and insight company in sports and health data.
Eloy Mazon, Chief Executive Officer of 4GLOBAL commented:
"This has been a transformative year for the Company following the successful
AIM IPO and fundraising. The IPO has raised our profile and led to the rapid
growth of our customer and data bases. With the many opportunities available
to us and a great team in place, I look forward with confidence to further
significant growth in the current year."
For further information please contact:
4GLOBAL c/o IFC Advisory
Eloy Mazon (CEO)
Spark Advisory Partners - Nominated Adviser 0203 368 3554
Neil Baldwin
Oberon Capital - Broker 0203 179 5300
Michael Seabrook, Adam Pollock, Chris Crawford
IFC Advisory 0203 934 6630
Graham Herring / Zach Cohen 07793 839 024
A copy of these results is available on the Company's website www.4global.com
(http://www.4global.com/) . In addition the Report & Accounts will be
available on the Company's website shortly and will be sent to shareholders by
9(th) August 2022.
CHAIRMAN'S STATEMENT
As this is my first statement for the Group as Chairman after our successful
IPO on AIM, I am pleased to announce our results for the year ended 31 March
2022. The Group has had a busy time since joining AIM on 7 December 2021,
however, this has been built on a number of years of developing the business
model and product platforms. The success of the business is down to the team,
which is led by Eloy Mazon, who founded the business, but also all of the
staff and management who continue to develop and push the business forward.
Results
The results for the year ended 31 March 2022 have been prepared as if 4GLOBAL
PLC has been in existence since 1 April 2020 to allow comparative information
to be available. Revenue for the year ended 31 March 2022 was £3.6m up 35.9%
on the previous year. This increase was driven by project set up revenues
within our subscription revenue stream. Subscription (recurring revenues)
revenue increased by 36.0%.
Our alternative reporting (excluding, inter alia, the IPO costs) results for
the year ended 31 March 2022 was an operating profit of £573,299 (2021:
£559,018) an increase of 2.6%. This improvement is after investing in new
hires and setting up the PLC Board.
Board and People
I would like to thank my fellow Board members for the guidance and
contribution to the successful IPO and our results for the year. We have an
ambitious growth strategy for the business and the insight from the Board will
ensure we execute the strategy positively. Also, I have to thank our
colleagues within the business for their hard work and professionalism and
their vital support in delivering these results but setting the platform for
the future.
Annual General Meeting
The Annual General Meeting will be held at 10:00am on Thursday 8 September
2022 at the Company's offices, 5th Floor, Building 7 Chiswick Park, 566
Chiswick High Road, Chiswick, London, W4 5YG.
Outlook
The Company has many opportunities in the coming 12 to 24 months in both
sports consultancy services and also our subscriptions led revenue streams. We
will continue to expand with our land and expand strategy and develop new
products as well as look for acquisition possibilities. The Board is confident
about the Group's current prospects.
Ian James
Chairman
6 July 2022
CHIEF EXECUTIVE'S STATEMENT
The successful IPO earlier this financial year marked a new and exciting
chapter for 4GLOBAL.
This achievement was made possible thanks to the enormous efforts of everyone
at 4GLOBAL over the years during which we have established an incredible
reputation in our sector worldwide and developed best-in-class data and
insight products and services that are recognised as having transformed our
customers' businesses.
A key priority for us over the years has been to ensure that 4GLOBAL was built
on a robust foundation with solid business principles around revenue and cash
generation, profitability and sustainable growth. This is now reflected in our
strong balance sheet and financial position.
From day one we set out to build a reputation in the market of "always
delivering on our promises" and I am very pleased that in my first statement
as CEO of an AIM quoted company, we have stayed true to this objective by
delivering and exceeding on market expectations.
Our growth strategy is underpinned by three pillars; international expansion,
"land & expand" clients and acquisition strategy. Significant progress has
been made in this financial year against each of these pillars.
1) International expansion - our international expansion is in full execution
mode. Going into our final quarter of the financial year (January to March
2022) we saw strong demand for our data & insight products in the European
and North American market which were ahead of management's expectations. In
addition to strong demand, data acquisition in those regions is ahead of plan
thus strengthening our market position and allowing us a quicker penetration
of these markets.
2) "Land and expand" clients - since the IPO we have landed a significant
number of new clients and expanded on several client relationships which we
already had in the UK, European, Middle East and North American markets. The
current need for data and insight to navigate complex strategic, operational
and investment challenges has generated strong demand for our data and insight
products and services and this has been reflected in the revenue growth
compared to last year.
3) Acquisition strategy - we have a strong deal pipeline and we are in active
conversations with several potential targets although no agreements have yet
been reached. We are confident that we have identified strong candidates that
will be complementary to the overall value and growth of 4GLOBAL.
Overall, excellent progress has been made in executing our strategy and we are
pleased with the results it is generating.
During the financial year we released updated editions of both our social
value calculator (SVC) and CitiHub. Existing clients have migrated and new
clients are being on-boarded onto the new platforms.
We have also been working on new revenue streams around data products that
will expand our ability to grow faster and in a sustainable way.
Finally, we extended our operations to the North American Market, establishing
4GLOBAL Inc in the USA and a permanent presence with the opening of an office
in Miami, Florida.
Summary and Outlook
We completed our first year as an AIM quoted company and in a strong financial
position - profitable, cash generative and with a sound balance sheet - an
excellent foundation on which to build in the current financial year.
Demand for our data and insight products continues to grow. The many
significant challenges faced in our sector due to the uncertain global
economic outlook, will, we believe, drive our customers to seek ever more
business-critical insight and that is the very strong message we are getting
from our customers.
We are encouraged by the prospects for the rest of the financial year and
beyond as we seek to increase our penetration in the European and North
American markets and develop new revenue streams associated with our data.
I would like to thank all our staff for their efforts in 2021/22 to realise
the true potential of 4GLOBAL and growth capabilities.
Eloy Mazon
6 July 2022
FINANCIAL REVIEW
This is the first annual report and accounts for the Group which was
successfully listed on AIM on 7 December 2021. The Group uses a number of key
indicators to monitor the Group's performance. The Group was founded in 2002
as a consultancy business and has migrated to a sports participation data
analytical business. The presentation of the financial numbers has been made
as if the Group had been incorporated from 1 April 2020 to allow the Board of
Directors to present the financial performance of the Group on a comparable
basis. The results for the year ended 31 March 2022 are presented on this
basis and on a Headline Results basis as follows:
Reconciliation of statutory to Headline profit before taxation
Year ended 31 March 2022 Year ended 31 March 2021
£ £
Statutory (loss)/profit before taxation (1,888,693) 356,526
Separately disclosed items
Depreciation 196,756 142,147
Share based payment expense 169,550 33,063
Exceptional items 2,071,781 -
Finance cost (net) 23,905 27,282
Headline profit before taxation 573,299 559,018
Group revenue, for the year ended 31 March 2022, has increased by 35.9% to
£3.6m from £2.7m. Gross profit has increased from £1.8m to £2.6m, up
43.1%.
The Group analyses revenue into two streams of consultancy and subscription
revenues. Consultancy revenues constitute services provided to clients for
major sporting events and Subscription revenues is made of two elements; one
is fees from setting up a client on a product platform, Project Set Up ("PSU")
fees. The second is a licence fee for the use of the platform and any advice
fees for analysis requested by the client.
The aim of the Group is to migrate the revenues to a majority recurring
subscription revenue basis. The revenue split as follows:
Analysis of revenue by category Year ended 31 March Year ended 31 March 2021
2022
£ % £ %
Consultancy 2,087,249 57% 1,919,719 72%
Subscriptions 1,552,681 43% 759,055 28%
3,639,930 2,678,774
This reflects the Group's move to generating more subscription revenues and
the growth rate in subscription revenues was 105%, however, the Group still
increased its consultancy revenues by 8.9%. Subscription revenue constituted
56.6% (2021: 85.1%) of the total of Subscription revenue, which reflected a
greater amount of PSU during the year ended 31 March 2022.
To arrive at a Headline profit before tax the Directors feel it appropriate to
make the financial numbers comparable at an earnings before interest, tax,
depreciation and amortisation, share based payment expense and exceptional
items.
At the time of the IPO a new share option scheme was implemented a total of
1,755,072 options were issued at 91p and 550,800 options were issued at 35.6p.
A net charge of £169,550 (2021: £33,063) has been taken to the share based
payment reserve on the balance sheet.
The exceptional items include:
Year ended Year ended
31 March 2022 31 March 2021
(Restated)
£ £
IPO costs 874,650 -
Cash settlement of historic option contracts 1,114,080 -
Legal settlement of contract dispute 70,000 -
Pension contributions for prior years 13,051 12,272
Total exceptional items 2,071,781 12,272
Exceptional Items includes the IPO costs incurred at the time of the Group's
IPO on 7 December 2021 of £0.9m (2021: £nil).
The Group had issued share options to individuals during 2020. The options
represented 38% of the then issued share capital of 4GLOBAL Consulting Ltd and
were to reward these individuals for the work and development of that company
that they had made over previous years. The potential overhang and dilutive
effect of these options on the issued share capital, after taking advice, was
seen as detrimental to the company's prospects of completing a successful IPO.
The individuals agreed to waive their options for a cash settlement of £1.0m
in addition a provision was made for employers' National Insurance
contributions.
The directors have identified two amounts as exceptional because of their
nature and relating to events in previous periods. One is a legal dispute with
a client which has been settled post the year end and the other is provision
for adjustments to pension contribution that have an impact on the previous
year's results. This has affected the opening reserves for the 1 April 2020
and a charge being made in the accounts for the year ended 31 March 2021 and a
charge in the year ended 31 March 2022. The total provision for the three
years is £41,509. A provision of £13,052 has been made in this current
reporting year and prior year adjustment of £12,272 made in the year ended 31
March 2021. The opening reserves for the year ended 31 March 2021 have been
adjusted by the prior adjustment by £16,184.
The Headline Adjusted Profit from Operations is £573,299 (2021: £559,018) an
increase of 2.6%.
The prior year benefitted from a grant under the CJRS and CBIL arrangements
introduced by the British Government of £54,959. Excluding this amount the
Headline Adjusted Profit from Operations would be an increase of 13.7%.
The Group has also increased its cost base as a result of being a PLC and
appointing a board of directors and other associated costs.
Tax
The Group benefits from research and development expenditure for which the
Group can claim enhanced rebates of 230% of the expenditure incurred. There is
therefore a tax credit to the Income Statement for the year ended 31 March
2022.
Earnings per share
The statutory loss per share for the year ended 31 March 2022 is a loss of 7.1
pence (2021: profit of 370 pence). As the Group produced a statutory loss for
the year there is no diluted earnings per share (2021: profit of 338 pence).
Cash Flow
The Group utilised £1,053,912 (2021: generated £584,685) from operations in
the year. This was after the settlement of exceptional items which included
IPO costs of £874,650 and the cash settlement of share options £1.1m.
The Company successfully listed on AIM on 7 December 2021 and raised £3.4m,
before expenses, from the issue of shares in the Company.
As at 31 March 2022 the Group held cash and cash equivalents of £3.1m.
Statement of financial position
The Group's statement of financial position is in a very healthy position. Net
assets totalled £3.5m. Most of the statement of financial position is made up
of liquid assets of trade receivables and cash and cash equivalents. Working
capital was £3.1m.
Keith Sadler
Chief Financial Officer
6 July 2022
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the year ended 31 March 2022
Note Year ended 31 March 2022 Year ended 31 March 2021
£ £
(Restated)
Revenue 6 3,639,930 2,678,774
Cost of sales (1,024,175) (851,346)
Gross profit 2,615,755 1,827,428
Administrative expenses (2,043,103) (1,323,369)
Other operating income 7 647 54,959
Analysed as:
Adjusted profit from operations(1) 573,299 559,018
Depreciation (196,756) (142,147)
Share based payment expense (169,550) (33,063)
Exceptional items 8 (2,071,782) -
Prior year adjustment 8 - (12,272)
(Loss)/profit from operations 8 (1,864,789) 371,536
Finance income 73 41
Finance cost 11 (23,977) (27,323)
(Loss)/profit before tax 3 (1,888,693) 344,254
Tax credit 12 242,581 39,525
(Loss)/profit for the year (1,646,112) 383,779
Other comprehensive income
Exchange differences on translation of foreign operations (11,058) (16,277)
Other comprehensive income for the year (11,058) (16,277)
Total comprehensive (loss)/income for the year (1,657,170) 367,502
Total comprehensive (loss)/income attributable to:
Owners of the Parent Company (1,657,170) 367,502
Basic (loss)/profit £ per share 13 (7.1)p 370p
Diluted (loss)/profit £ per share 13 (7.1)p 338p
Note 1. Adjusted profit from operations is calculated as earnings before
interest, taxation, depreciation, amortisation of intangible assets and right
of use charge, any impairment costs relating to non-current assets, share
based payments and exceptional items.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Note As at As at
31 March 2022 31 March 2021
(Restated)
£ £
Assets
Non-current assets
Property, plant and equipment 14 28,870 10,689
Right-of-use assets 14 382,490 274,381
411,360 285,070
Current assets
Trade and other receivables 15 1,764,482 1,896,559
Cash and cash equivalents 16 3,050,948 775,342
4,815,430 2,671,901
Total assets 5,226,790 2,956,971
Equity and Liabilities
Equity
Share capital 17 263,451 1,097
Capital redemption reserve - 105
Share premium 19 3,390,330 894,491
Merger reserve 676,310 -
Share option reserve 18,19 139,080 31,773
Share warrant reserve 188,266 -
Currency translation reserve (32,323) (21,265)
Retained earnings 19 (1,121,325) 485,206
Total equity 3,503,789 1,391,407
Non-current liabilities
Borrowings 21 158,823 273,458
Lease liability 22 - 147,273
158,823 420,731
Current liabilities
Borrowings 21 121,814 45,833
Trade and other payables 20 1,088,553 964,597
Lease liability 22 353,811 134,403
Total current liabilities 1,564,178 1,144,833
Total liabilities 1,723,001 1,565,564
Total equity and liabilities 5,226,790 2,956,971
CONSOLIDATED STATEMENT OF CASH FLOWS
Note Year ended 31 March 2022 Year ended 31 March 2021
(restated)
£ £
Cash flows from operating activities
(Loss)/profit before income tax for year (1,888,693) 344,254
Adjustments to reconcile (loss)/profit before tax to net cash flows:
Depreciation of tangible assets 14 196,723 142,127
Loss on disposal of fixed assets (9,894) -
Other income - (7,117)
Finance income - (41)
Finance cost 11 23,977 23,417
Equity-settled share-based expense/warrants 8 169,550 33,063
Decrease/(increase) in trade and other receivables 390,838 460,523
(Decrease)/increase in trade and other payables 63,587 (545,201)
Tax received - 133,660
Net cash flows - operating activities (1,053,912) 584,685
Cash flows from investing activities
Purchase of tangible assets 14 (23,773) (4,936)
Interest received 73 41
Net cash - investing activities (23,700) (4,895)
Cash flows from financing activities
Issue of ordinary share capital 3,612,662 -
Proceeds from borrowings - 250,000
Repayment of borrowings (41,168) -
Payments for shares bought back - (50,000)
Lease liability principal payment 22 (186,470) (129,895)
Interest elements of lease payments (10,780) (13,705)
Interest paid (9,445) (83)
Net cash flows - financing activities 3,364,799 56,317
Net increase in cash 2,287,187 636,107
Effects of exchange rate changes on cash (11,581) (15,930)
Cash at beginning of year 775,342 155,165
Cash at the end of year 16 3,050,948 775,342
Comprising:
Cash and cash equivalents 3,050,948 775,342
Cash at end of year 16 3,050,948 775,342
NOTES TO THE FINANCIAL STATEMENTS
1. Corporate information
4Global PLC is a public limited company incorporated and domiciled in England
and Wales. The registered office address and principal place of business is
located at 5(th) Floor, Building 7 Chiswick Park, 566 Chiswick High Road,
London, W4 5YG. The Company was incorporated on 22 July 2021.
The 4GLOBAL Group's principal activity is the provision of advisory services
in the sporting sector at a local, national and international level.
2. Basis of preparation
The financial statements have been prepared in accordance with the
requirements of the AIM Rules for Companies, UK Adopted International
Accounting Standards. This is the first time the 4GLOBAL Group has prepared
financial information under UK Adopted International Accounting Standards.
The financial statements have been prepared on the historical cost basis,
unless accounting standards require an alternative measurement basis. Where
there are assets and liabilities calculated on a different basis, this fact is
disclosed in either the relevant accounting policy or in the notes to the
financial information.
The preparation of the financial statements in compliance with UK Adopted
International Accounting Standards requires the use of certain critical
accounting estimates and judgements. It also requires management to exercise
judgement of the most appropriate application in applying the 4GLOBAL Group's
accounting policies. The areas where significant judgements and estimates have
been made in preparing the financial information and their effect are
disclosed in Note 4.
3. Going concern
The financial statements have been prepared on the going concern basis. The
Group made a loss for the year to 31 March 2022, which was due to exceptional
costs incurred in the IPO process. At the adjusted profit line the business is
profitable. The Group has cash resources of £3.1m. The Directors have
reviewed the 4GLOBAL Group's overall position and outlook and are of the
opinion that the 4GLOBAL Group is sufficiently well funded to be able to
operate as a going concern for at least the next twelve months from the date
of approval of these financial statements.
4. Critical accounting judgements and key sources of estimation uncertainty
The preparation of financial statements in conformity with UK Adopted
International Accounting Standards requires management to make estimates and
judgements that affect the reported amounts of assets and liabilities as well
as the disclosure of contingent assets and liabilities at the year-end date
and the reported amounts of revenues and expenses during the reporting year.
Estimates and judgements are continually evaluated and are based on historical
experience and other factors, including expectations of future events that are
believed to be reasonable under the circumstances. The significant judgements
made by management in applying the 4GLOBAL Group's accounting policies and the
key sources of estimation uncertainty were:
4.1 Consultancy revenue
For contracts spanning the year end the 4GLOBAL Group uses judgement
determining the amount of revenue to recognise in each period. This requires
estimation of the stage of completion of the project, taking into account time
spent during the period and the likely time required to complete the project.
4.2 Bad debts
The group currently calculates a "bad debt" provision on trade receivables and
contract assets which are past due date and are not specifically provided for.
Under IFRS 9 this assessment is required to be calculated based on a forward
looking expected credit loss ('ECL') model, for which a simplified approach
will be applied. The method uses historic customer data, alongside future
economic conditions to calculate expected loss on receivables. See Note 15.
4.3 Legal claims
The provision for legal claims is an estimate of the potential amount that may
be due when the Group is in dispute with another party. An estimation is made
after taking advice from legal advisers.
4.4 Deferred tax
Deferred tax assets and liabilities are recognised where the carrying amount
of an asset or liability in the combined statement of financial position
differs from its tax base.
Recognition of deferred tax assets is restricted to those instances where it
is probable that taxable profit will be available against which the difference
can be utilised.
4.5 Share options and warrants
Where equity settled share options are awarded to employees, the fair value of
the options at the date of grant is charged to the consolidated statement of
comprehensive income over the vesting period as an employment expense.
The fair value of the options is measured at the grant date and spread over
the vesting period. The fair value is measured based on an option pricing
model taking into account the terms and conditions upon which the instruments
were granted.
The Company has issued warrants to certain advisers at the time of the group's
IPO. The fair value of the services provided is charged to the statement of
comprehensive income.
5. Summary of significant accounting policies
5.1 Basis of consolidation
The financial statements incorporate the financial information of the 4GLOBAL
Group. Control is achieved when a company is exposed, or has rights, to
variable returns from its involvement with the entity and has the ability to
affect those returns through its power over the entity. Where necessary,
adjustments are made to the financial information of subsidiaries to bring the
accounting policies used into line with those used by other members of the
4GLOBAL Group. All significant inter-company transactions and balances between
4GLOBAL Group entities are eliminated on consolidation.
Subsidiary companies
4GLOBAL PLC's subsidiaries are as follows:
Proportion of
Country of Nature of voting rights and
Name of company incorporation business Interest shares held
4GLOBAL Consulting Ltd ("4GLOBAL Consulting") England and Wales Provision of data and consultancy services to the sports participation market 100% 100%
4GLOBAL Inc USA Provision of data and consultancy services to the sports participation market 100% 100%
4Global Danismanlik Ve Yazilim Hiz. LTD.STI ("4Global Turkey") Turkey Provision of services on behalf of parent 100% 100%
The registered office address and principal place of business of 4GLOBAL
Consulting is 5(th) Floor, Building 7, Chiswick Business Park, 566 Chiswick
High Road, London, W4 5YG.
4GLOBAL Inc is currently dormant. It is anticipated to begin trading in the
early part of the financial year ending 31 March 2023.
The registered office address and principal place of business of 4Global
Turkey is Istasyon Yolu Sok. No: 3 Altintepe, Maltepe, Istanbul.
The Company's subsidiary in Turkey has a year end of 31 December which was set
when the company was set up and is a normal year end for Turkish companies.
The preparation of the financial information for the Group accounts has
therefore been based on the management accounts for that company to 31 March.
The Group is liaising with local advisers to attempt to amend the year end to
31 March.
In applying merger accounting when preparing these Consolidated Financial
Statements, to the extent
the carrying value of the assets and liabilities acquired under merger
accounting is different to the cost of investment, the difference is recorded
in equity within the merger reserve. Under merger accounting the results of
the Group entities are combined from the beginning of the comparative period
before the merger occurred. Comparatives are restated on a combined basis and
adjustments made as necessary to achieve consistency of accounting principles.
5.2 Revenue
Consultancy services
Consultancy services are provided under fixed-price contracts and contracts
specifying an hourly fee. Revenue from providing services is recognised based
on the actual service provided to the end of the reporting period as a
proportion of the total services to be provided because the customer receives
and uses the benefits simultaneously. This is determined based on the actual
hours spent relative to the total expected hours.
In the case of fixed-price contracts, the customer pays the fixed amount based
on a payment schedule. If the services rendered exceed the payment, a contract
asset is recognised. If the payments exceed the services provided then a
contract liability is recognised.
If the contract includes an hourly fee, revenue is recognised in the amount to
which the 4GLOBAL Group has a right to invoice. Customers are invoiced on a
monthly basis and consideration is payable when invoiced.
Subscriptions
Subscriptions for access to the Datahub are provided under fixed-price
contracts. Customers pay in advance on a monthly, quarterly or annual basis
and consideration is payable when invoiced. Where access to the Datahub has
been invoiced but not paid at the end of the reporting period, a contract
liability is recognised in respect of the services not yet provided. Revenue
is recognised on a straight-line basis over the term of the subscription.
5.3 Government grants
Grants from the government are recognised at their fair value where there is a
reasonable assurance that the grant will be received and the 4GLOBAL Group
will comply with all attached conditions. Grants are recognised in other
operating income in the statement of comprehensive income.
5.4 Research expenditure
The Group undertakes research into future development of products and
platforms utilising the data sources that the Group curates. This is
separately identified and recorded. The Group makes a claim for enhanced tax
relief on this expenditure through HMRC. The expenditure is separately
identified in the income statement notes.
5.5 Foreign currency translation
Functional and presentational currency
Items included in the financial statements of each of the 4GLOBAL Group's
entities are measured using the currency of the primary economic environment
in which the entity operates ('the functional currency'). The financial
statements are presented in pounds sterling, which is 4Global Group's
functional and presentation currency.
Transactions and balances
Foreign currency transactions are translated into the functional currency
using the spot exchange rates at the dates of the transactions.
At each year end foreign currency monetary items are translated using the
closing rate. Non‑monetary items measured at historical cost are translated
using the exchange rate at the date of the transaction and non‑monetary
items measured at fair value are measured using the exchange rate when fair
value was determined.
Foreign exchange gains and losses resulting from the settlement of
transactions and from the translation at year‑end exchange rates of monetary
assets and liabilities denominated in foreign currencies are recognised in the
statement of comprehensive income.
Foreign exchange gains and losses that relate to borrowings and cash and cash
equivalents are presented in the statement of comprehensive income within
'administrative expenses'. All other foreign exchange gains and losses are
presented in the statement of comprehensive income under the heading to which
they relate.
4GLOBAL Group Companies
The results and financial position of foreign operations (none of which has
the currency of a hyperinflationary economy) that have a functional currency
different from the presentation currency are translated into the presentation
currency as follows:
· assets and liabilities for each balance sheet presented are
translated at the closing rate at the date of that balance sheet
· income and expenses for each statement of profit or loss and
statement of comprehensive income are translated at monthly exchange rates
throughout the period, and
· all resulting exchange differences are recognised in other
comprehensive income.
Taxation
Taxation expense for the year comprises current and deferred tax recognised in
the reporting year. Tax is recognised in the statement of comprehensive
income.
Current tax
Current tax is the amount of tax payable in respect of the taxable profit for
the year or prior years. Tax is calculated on the basis of tax rates and laws
that have been enacted or substantively enacted by the year end.
Management periodically evaluates positions taken in tax returns with respect
to situations in which applicable tax regulation is subject to interpretation.
It establishes provisions where appropriate on the basis of amounts expected
to be paid to the tax authorities.
Deferred tax
Deferred tax is the tax expected to be payable or recoverable on differences
between the carrying amounts of assets and liabilities in the financial
statements and the corresponding tax bases used in the computation of taxable
profit or loss.
Deferred tax assets are recognised for deductible temporary differences that
exist only where it is probable that taxable profits will be generated against
which the carrying value of the deferred tax asset can be recovered.
Deferred tax liabilities are recognised for all taxable temporary differences
except in respect of taxable temporary differences associated with investments
in subsidiaries, associates and interests in joint operations where the timing
of the reversal of the temporary difference can be controlled and it is
probable that the temporary difference will not reverse in the foreseeable
future.
A deferred tax asset or liability is not recognised if a temporary difference
arises on initial recognition of an asset or liability in a transaction that
is not a business combination and, at the time of the transaction, affects
neither the accounting profit nor taxable profit or loss.
5.6 Share-based payments
The 4GLOBAL Group measures the fair value of equity-settled transactions with
employees and Directors at the grant date of the equity instruments. The fair
value is calculated using an appropriate valuation model and requires
assumptions regarding dividend yields, risk-free interest rates, share price
volatility and expected life of an employee or Director share option. The
arising expense is charged to the statement of comprehensive income on a
straight-line basis over the expected vesting period.
5.7 Warrants
The 4GLOBAL Group issued warrant certificate to advisers at the time of the
IPO and measures the fair value of the equity settled transactions with the
advisers at the grant date of the warrant instruments. The fair value is
calculated using an appropriate valuation model and requires assumptions
regarding dividend yields, risk-free interest rates, share price volatility
and expected life of the warrant. The resulting amount is charged to the share
premium account and credited to the share warrant reserve.
5.8 Property plant and equipment
Property, plant and equipment is recorded at cost less accumulated
depreciation and accumulated impairment losses. The initial cost of an asset
comprises its purchase price and any costs attributable to bringing the asset
into the location and condition necessary for it to be capable of operating in
the manner intended by management. Expenditures for routine maintenance and
repairs are expensed as incurred, while additions and improvements are
capitalised. A right-of-use asset is recognised at the commencement date of
the lease. The right-of-use asset is measured at cost, which comprises the
initial amount of the lease liability, adjusted for, as applicable, any lease
payments made at or before the commencement date, any initial direct costs
incurred and an estimate of costs expected to be incurred for restoring the
site or asset.
Property, plant and equipment is depreciated using the straight-line method
over the estimated useful lives or, in the case of certain leased right-of-use
assets, the shorter of the expected lease term and estimated useful life:
§ Office equipment - 4 years
§ Land and buildings - over the term of the lease
An item of property, plant and equipment is derecognised upon disposal or when
no further economic benefits are expected to arise from the use of that asset.
Any gain or loss arising on de-recognition of the asset is included in the
statement of comprehensive income when the asset is derecognised.
5.9 Leasing
The 4GLOBAL Group applies a single recognition and measurement approach for
all leases except for short-term leases and leases of low-value assets. At
commencement of a lease, the 4GLOBAL Group as lessee recognises a liability to
make lease payments and an asset representing the right to use the underlying
asset during the lease term. The amount of the lease liability recognised is
on a discounted basis. The discount rates used on transition were incremental
borrowing rates as appropriate for each lease based on factors such as the
lease term and payment terms. Where the rate implicit in the lease cannot
readily be determined the 4GLOBAL Group used the 4GLOBAL Group's incremental
borrowing rate. The 4GLOBAL Group does not have any leases where the 4GLOBAL
Group is a lessor.
The 4GLOBAL Group takes advantage of the practical expedient which allows an
exemption from recognition for leases with terms of 12 months or less and low
value leases.
5.10 Cash and cash equivalents
Cash and cash equivalents includes cash in hand, deposits held at call with
banks and other short-term highly liquid investments in debt securities with
original maturities of three months or less.
5.11 Financial instruments
A financial instrument is any contract that gives rise to a financial asset of
one entity and a financial liability or equity instrument of another entity.
Financial instruments are classified into one of the categories discussed
below in accordance with IFRS 9, with reference to the business model for that
instrument and the contractual cash flow characteristics.
Financial assets and liabilities are offset and the net amount reported in the
financial statements if there is a currently enforceable legal right to offset
the recognised amounts and there is an intention to settle on a net basis, or
to realise the assets and settle the liabilities simultaneously.
The accounting policy for each category is as follows:
Financial assets
Financial assets comprise cash and cash equivalents and receivables.
Receivables primarily consist of trade and other receivables. These assets are
non-derivative financial assets with fixed or determinable payments that are
not quoted in an active market. These assets are initially recognised at
transaction price plus transaction costs that are directly attributable to
their acquisition or issue and are subsequently carried at amortised cost
using the effective interest rate method, adjusted for change in expected
credit losses.
Impairment of financial assets
The IFRS 9 impairment model requires the recognition of 'expected credit
losses'. Therefore, it is not necessary for a credit event to have occurred
before credit losses are recognised. The impairment model applies to the
4GLOBAL Group's financial assets.
For trade receivables the 4GLOBAL Group has applied the simplified approach
permitted by IFRS 9 in calculating expected credit losses. This approach
requires expected lifetime losses to be recognised from initial recognition of
the receivables.
Financial liabilities
Financial liabilities include trade and other payables, borrowings and lease
liabilities.
Trade and other payables
Trade and other payables are initially recognised at fair value and
subsequently carried at amortised cost using the effective interest method.
Lease liabilities
Lease liabilities are recognised at the present value of future lease payments
and subsequently carried at amortised cost using the effective interest
method.
Borrowings
Borrowings are initially recognised at fair value and subsequently carried at
amortised cost using the effective interest method.
Derecognition
A financial liability is derecognised when the obligation under the liability
is discharged, cancelled, or expires. When an existing financial liability is
replaced by another from the same lender on substantially different terms or
the terms of an existing liability are substantially modified, such an
exchange is treated as the de-recognition of the original liability and the
recognition of a new liability. When the modification is not substantial the
difference between the carrying amount of the liability before the
modification and the present value of the cash flows after modification is
recognised in profit or loss.
Classification of financial instruments issued by the 4GLOBAL Group
Financial instruments issued by the 4GLOBAL Group are treated as equity only
to the extent that they meet the following two conditions:
• they include no contractual obligations upon the 4GLOBAL Group to deliver
cash or other financial assets or to exchange financial assets or financial
liabilities with another party under conditions that are potentially
unfavourable to the Group; and
• where the instrument will or may be settled in the 4GLOBAL Group's own
equity instruments, it is either a non-derivative that includes no obligation
to deliver a variable number of the 4GLOBAL Group's own equity instruments or
is a derivative that will be settled by the 4GLOBAL Group exchanging a fixed
amount of cash or other financial assets for a fixed number of its own equity
instruments.
5.12 Related party transactions
The 4GLOBAL Group discloses transactions with related parties which are not
wholly owned within the same group. It does not disclose transactions with
members of the same group that are wholly owned. Transactions of a similar
nature are aggregated unless, in the opinion of the Directors separate
disclosure is necessary to understand the effect of the transactions on the
financial statements.
Mr Mazon, through a controlled company, EMH Limited, invoiced the Group during
the year ended 31 March 2022 £87,062 for professional and consultancy
services (31 March 2021 £137,940). £4,840 was outstanding at 31 March 2022
(31 March 2021, £4,840). Mrs E Mazon, trading as Family Paws, invoiced the
Group for secretarial and coaching services during the year £15,000 (312
March 2021 £Nil). £Nil was outstanding at 31 March 2022 (31 March 2021
£Nil).
A loan of £50,400 was made by Mr Eloy Mazon. The loan was drawn down between
December 2013 and September 2014 and bears interest at 5% plus the Bank of
England base rate, which has been accrued with the loan. The balance
outstanding at 31 March 2022 was £70,805 (2021: £69,293). After the year end
the loan was repaid to Mr Mazon.
Mr James, through a controlled company, Fluency Media Limited, invoiced the
Group during the year ended 31 March 2022 £168,000 including VAT (31 March
2021 £46,800). £Nil was outstanding at 31 March 2022 (31 March 2021 £Nil).
Mr James received £620,000 for the settlement of the surrender of share
options he held over the share capital of 4GLOBAL Consulting Ltd, this was
settled at the time of the company's IPO.
During the year ended 31 March 2021, the 4GLOBAL Group incurred charges of
£100,000 from a company controlled by a director of the 4GLOBAL Group, in
relation to share issuance costs. The amount was settled during the year ended
31 March 2022. The amount outstanding at the year ended 31 March 2021 was
shown in other payables.
5.13 Standards, amendments and interpretations to existing standards that are not
yet effective and have not been early adopted by the 4GLOBAL Group
The following standards and interpretations relevant to the Group are in issue
but are not yet effective and have not been applied in the financial
statements.
• IAS 1 Presentation of liabilities as current or non-current
• IAS 1 Disclosure of accounting policies
• IAS 8 definition of accounting estimates
• Interest rate benchmark reform - IFRSs 7,9 and 16
The above standards are not expected to materially impact the Group.
5.14 Segment information
The chief operation decision-maker ("CODM") is considered to be the Board of
Directors of the Group. The CODM allocates resources and assesses the
performance of the business and other activities at the operating segment
level.
The CODM has determined that the 4GLOBAL Group has one operating segment, the
provision of advisory services to the sporting industry at a local, national
and international level.
6. Analysis of revenue
Analysis of revenue by category Year ended 31 March 2022 Year ended 31 March 2021
£ £
Consultancy 2,087,249 1,919,719
Subscriptions 1,552,681 759,055
3,639,930 2,678,774
Analysis of revenue by geography Year ended 31 March 2022 Year ended 31 March 2021
£ £
Europe 2,351,970 1,569,280
South America 890,608 358,413
Middle East 362,383 727,508
Other 34,969 23,573
3,639,930 2,678,774
During the year ended 2022, the 4GLOBAL Group had two customers whose revenues
accounted for more than 10%, making up 14.7% and 14.2% respectively.
During the year ended 2021, the 4GLOBAL Group had two customers whose revenues
accounted for more than 10%, making up 27% and 13% respectively.
The 4GLOBAL Group has determined that the 4GLOBAL Group has one operating
segment and therefore all revenue above is attributable to that segment.
Outstanding balances at year end are unsecured, interest free and settlement
occurs in cash.
Included within trade and other receivables are contract assets as follows:
As at 31 March 2022 2021
£ £
Contract assets 463,931 79,460
Contract assets are included within "Trade and other receivables" on the face
of the statement of financial position. They arise when the Group has
performed services in accordance with the agreement with the relevant client
and has obtained right to consideration for these services but such income has
not been invoiced at the balance sheet date. Significant changes in contract
assets have arisen due to timing differences in the issue of invoices between
periods.
Included within trade and other payables are contract liabilities as follows:
As at 31 March 2022 2021
£ £
Contract liabilities (216,696) (208,215)
All contract liabilities are recognised as revenue in the subsequent reporting
period.
7. Other operating income
Other operating income comprises:
2022 2021
£ £
Government grants - CJRS - 47,842
Government grants - CBILS BIP - 7,117
Business Interruption receipt 647 -
647 54,959
During the year to March 2021, the 4GLOBAL Group was able to utilise the
Coronavirus Job Retention Scheme ("CJRS"), the government's support measure
for organisations throughout the pandemic. It offered grants of up to 80% of
wages, up to a maximum of £2,500 per month plus national insurance and auto
enrolled pension contributions, to cover the salary costs of those employees
that had been furloughed.
Additionally, the 4GLOBAL Group took a loan under the Coronavirus Business
Interruption Loan Scheme ("CBILS") (see note 21). Under the scheme, the
government made a Business Interruption Payment ("BIP") to cover the interest
charge for the first 12 months of the loan term.
8. Profit from operations and auditor's remuneration
Profit from operations is stated after charging/(crediting):
31 March 2022 2021
£ £
Fees payable to the company's auditors:
- Audit fees 47,500 -
- Other services - reporting
accountant services at the IPO
125,500 -
Depreciation of property, plant and equipment 5,833 4,937
Depreciation of right-of-use assets 190,890 137,190
Research expenditure 640,342 592,440
Equity settled share-based expense 169,550 33,063
Net loss on foreign currency translation 11,581 27,239
Short-term lease expense - 25,291
1,191,196 820,160
The Alternative Performance Measures used by management are shown below:
31 March 2022 2021
£ £
(Loss)/profit from operations (1,864,789) 383,808
Depreciation and amortisation expense 196,756 142,147
Share based option charge 169,550 33,063
Exceptional items 2,071,782 -
Prior year adjustment - 12,272
Adjusted EBITDA 573,299 559,018
Exceptional items which have been identified because of their size or the
nature of the expense being one-off in nature are as follows:
31 March 2022 2021
£ £
IPO costs 874,650 -
Cash settlement of historic option contracts 1,114,080 -
Legal settlement of contract dispute 70,000 -
Provision for adjustment to pension contributions 13,052 12,272
Total exceptional items 2,071,782 12,272
The prior year adjustment relates to a provision for adjustments to pension
contribution that have an impact on the previous year's results. This has
affected the opening reserves for the year 1 April 2020 and a charge being
made in the accounts for the year ended 31 March 2021 and a charge in the year
ended 31 March 2022. The total provision for the three years is £41,509. A
provision of £13,052 has been made in this current reporting year and prior
year adjustment of £12,272 made in the year ended 31 March 2021. The opening
reserves for the year ended 31 March 2021 have been adjusted by the prior
adjustment by £16,184.
9. Employees
Staff costs, including Directors' remuneration, were as follows:
31 March 2022 2021
£ £
Wages and salaries 1,401,895 888,936
Social security costs 275,425 102,769
Pension costs 35,501 22,845
Share based payment expense 169,550 33,063
Cash settlement of share options 1,000,000 -
Employee benefits 23,604 4,038
2,905,975 1,051,651
The average number of employees, including the Directors, during the year was
as follows:
31 March 2022 2021
Number Number
Directors 3 2
Administrative staff 2 2
Technical staff 23 21
28 25
10. Directors' remuneration
The Directors' aggregate remuneration in respect of qualifying services were:
Salary Pension Benefits Bonus Total Remuneration 2022 Total Remuneration 2021
£ £
E Mazon 131,665 3,016 20,698 - 155,379 -
K Sadler 96,667 2,900 - 12,500 112,067 -
I James 28,748 1,175 - 12,500 42,423 -
S Clarke 27,500 604 - - 28,104 -
A Orlando 19,122 - - - 19,122 -
R Taylor 20,000 400 - - 20,400 -
During the year, the 4GLOBAL Group made payments for consultancy services to
companies controlled by certain of the Directors of the 4GLOBAL Group. The
amounts invoiced and the amounts outstanding at the end of each year are: as
follows:
31 March 2022 2021
£ £
Invoices in year 260,800 175,433
Outstanding at year end 4,840 4,840
The remuneration of the highest paid Director was as follows:
31 March 2022 2021
£ £
Wages and salaries 28,748 118,831
Bonus 12,500 -
Social security costs 87,784 14,220
Cash settlement of share options 620,000 -
Pension costs 1,175 2,800
Employee benefits - 2,817
Share-based payments charges 43,155 12,016
793,362 150,684
Key management compensation is shown in the table below which includes the
directors. The Board was established during the financial year ended 31 March
2022.
Key management compensation is equal to Directors' renumeration.
31 March 2022 2021
£ £
Wages and salaries 544,102 201,270
Social security costs 206,440 25,351
Cash settlement of share options 1,000,000 -
Pension costs 15,055 5,624
Benefits 20,698 -
Bonus 25,000 -
Fees 85,241 78,138
1,896,536 310,383
11. Finance income and costs
31 March 2022 2021
£ £
Lease liability interest 10,780 13,705
Interest on Shareholder loan 2,512 2,595
Interest on CBILS loan 7,153 7,117
Interest on Grant 647 -
Bank Interest 2,885 3,906
Finance cost recognised in the income statement recognised 23,977 23,417
12. Taxation
31 March 2022 2021
£ £
Current tax credit
UK Corporation tax (193,004) (42,790)
Adjustments in respect of prior periods (43,459) -
Foreign tax on income for the year 5,445 4,007
Total current tax (231,018) (38,783)
Deferred tax credit
Movement on temporary differences (11,563) (742)
Income tax credit (242,581) (39,525)
Factors affecting tax credit for the year
The tax credit for the year can be reconciled to the loss per the statement of
comprehensive income as follows:
31 March 2022 2021
£ £
(Loss)/profit before tax (1,888,693) 383,808
(Loss)/profit before tax multiplied by the
UK corporate tax rate of 19% (358,852) 67,740
Effects of:
Amounts not taxable/deductible for tax purposes 72,112 14,665
Depreciation - plant and machinery super-deduction (1,357) 601
Enhanced research and development relief (98,804) (122,713)
Higher rate taxes on overseas earnings 1,247 182
Losses carried forward 178,956 -
Deferred tax on share options 3,568 -
Deferred tax on right of use asset 7,170 -
Deferred tax at higher rate (3,162) -
Adjustments in respect of prior periods (43,459) -
Income tax credit (242,581) (39,525)
Factors affecting future tax charges
An increase in the UK corporation tax rate from 19% to 25% for the financial
year beginning 1 April 2023 was substantively enacted on 24 May 2021. As IFRS
requires deferred tax to be measured at tax rates that have been subsequently
enacted at the reporting date, the Group's deferred tax balances have been
re-measured accordingly and the impact has been reflected within the
consolidated financial statements.
The following deferred tax assets have been recognised:
31 March 2022 2021
£ £
At beginning of period 30,564 29,822
Movement on temporary timing differences 12,822 742
At end of period 43,386 30,564
The above deferred tax assets comprise temporary differences on the following
items:
31 March 2022 2021
£ £
Staff costs 30,564 30,564
Share based payments 15,199 -
Right of use asset (7,170) -
Pensions deductible as paid 7,887 -
Interest on shareholder loan 4,067 -
Accelerated capital allowances (7,161) -
Deferred tax asset 43,386 30,564
The deferred tax asset on share options is expected to unwind within one year.
13. Earnings per share
31 March 2022 2021
(Restated)
Net (loss)/profit attributable to ordinary shareholders (£) (1,646,112) 383,779
Basic weighted average number of shares in issue (Number) 23,314,706 103,805
Basic (loss)/profit per share (pence per share) (7.1)p 370p
As at 31 March 2022 2021
Net (loss)/profit attributable to ordinary shareholders (£) (1,646,112) 383,779
Diluted weighted average number of shares in issue (Number) 24,165,128 113,678
Diluted (loss)/profit per share (pence per share) (7.1)p 338p
To prepare the company for its listing a 200:1 share split took place during
the year which increased the number of shares in issue. This increase in the
share capital increased the number of shares in issue at that time from
109,692 shares at the beginning of the year to 21,938,400 at the time of the
share split. This materially affected the calculation for earnings per share.
Weighted average number of shares used as the denominator
As at the year ended 31 March 2022 2021
Shares in issue at 1 April 109,692 103,805
Share for share exchange 200:1 21,938,400
-
Weighted number of shares issued in the year 1,376,306 -
The weighted average number of shares used as the denominator in basic 23,314,706 103,805
earnings per share
Adjustments for calculation of diluted earnings per share:
Options 720,190 9,873
Warrants 130,232 -
24,165,128 113,678
IAS 33 contains a requirement to restate the average number of shares in issue
in prior periods for events that change the number of shares without a
corresponding change in resources. For this purpose, it has been assumed that
the share split from £1.00 per share to £0.01 per share took place prior to
1 April 2020.
14. Property, plant and equipment
Land and buildings Office equipment Total
£ £ £
Cost
At 1 April 2019 - 44,691 44,691
Additions in year - 1,544 1,544
Disposals in year - (1,025) (1,025)
ar
Exchange differences - (76) (76)
As at 31 March 2020 - 45,134 45,134
Additions in year 411,571 4,936 416,507
Exchange differences - (595) (595)
As at 31 March 2021 411,571 49,475 461,046
Disposal of lease (411,571) - (411,571)
Additions in year 470,487 23,773 494,260
Exchange differences - (710) (710)
As at 31 March 2022 470,487 72,538 543,025
Depreciation
At 1 April 2019 - 25,499 25,499
Charge for year - 8,673 8,673
Exchange differences - (75) (75)
As at 31 March 2020 - 34,097 34,097
Charge for year 137,190 4,937 142,127
Exchange differences - (248) (248)
As at 31 March 2021 137,190 38,786 175,976
Charge for year 190,890 5,833 196,723
Disposal of lease (240,083) (240,083)
Exchange differences - (951) (951)
As at 31 March 2022 87,997 43,668 131,665
Net book value
As at 31 March 2020 - 11,037 11,037
Net book value
As at 31 March 2021 274,381 10,689 285,070
Net book value
As at 31 March 2022 382,490 28,870 411,360
Right of use assets included in the above comprise all land and buildings
assets. From 31 December 2021 the Group signed a new lease and surrendered its
existing lease in the same building with the same landlord. There were no
costs to the surrender.
15. Trade and other receivables
As at the year ended 31 March 2022 2021
£ £
Current
Trade receivables 753,245 450,080
Contract assets 459,086 79,460
Other receivables 259,475 118,298
Issue of share capital - 1,161,978
Current tax receivables 249,290 56,179
Deferred tax receivables 43,386 30,564
1,764,482 1,896,559
Trade receivables do not contain a significant financing component. These
financial assets have been reviewed at each year end the following provision
for expected credit losses is considered necessary:
As at the year ended 31 March 2022 2021
£ £
Gross carrying amount - trade receivables 766,186 452,792
Loss allowance (12,941) (2,712)
753,245 450,080
The loss allowances for trade receivables as at 31 March reconcile to the
opening loss allowances as follows:
2022 2021
£ £
Opening loss allowance at 1 April 2,712 57,079
Increase in loss allowance recognised in profit or loss 10,229 4,051
Increase in loss allowance relating to VAT - 452
Receivables written off during the year as uncollectible - (58,870)
Closing loss allowance at 31 March 12,941 2,712
Other receivables include amounts due for sales taxes, prepayments and
security deposits held for leases.
The maximum exposure to credit risk at the reporting date is the carrying
value of each class of receivable mentioned above. The 4GLOBAL Group does not
hold any collateral as security.
16. Cash and cash equivalents
As at the year ended 31 March 2022 2021
£ £
Cash at bank and on hand 3,050,948 775,342
Cash at bank and on hand does not earn interest.
17. Issued share capital
The allotted, called up and fully paid share capital was as follows:
As at the year ended 31 March 2022 2021
No. No.
£1.00 A Ordinary shares
As at 1 April - 420
Redesignated as Ordinary shares - (420)
As at 31 March - -
Fully paid A Ordinary shares carry one vote per share and the right to
dividends and to distributions on winding up.
As at the year ended 31 March 2022 2021
No. No.
£1.00 B Ordinary shares
As at 1 April - 400
Redesignated as Ordinary shares - (400)
As at 31 March - -
Fully paid B Ordinary shares carry one vote per share and the right to
dividends and to distributions on winding up.
As at the year ended 31 March 2022 2021
No. No.
£1.00 C Ordinary shares
As at 1 April - 105
Repurchased - (105)
As at 31 March - -
Fully paid C Ordinary shares carry one vote per share and the right to
dividends and to distributions on winding up.
On 26 November 2020 all the C ordinary shares were cancelled.
As at the year ended 31 March 2022 2021
No. No.
£1.00 D Ordinary shares
As at 1 April - 75
Redesignated as Ordinary shares - (75)
As at 31 March - -
Fully paid D Ordinary shares carry one vote per share and the right to
dividends and to distributions on winding up.
As at the year ended 31 March 2022 2021
No. No.
£1.00 E Ordinary shares
As at 1 April - 50
Redesignated as Ordinary shares - (50)
At 31 March - -
Fully paid E Ordinary shares carry one vote per share and the right to
dividends and to distributions on winding up.
2022 2022 2021
No. £ No.
£0.01 Ordinary shares
As at 1 April 109,692 1,097 -
Redesignated from other share classes - 945
Subdivision of shares - 93,555
Issue of shares - 15,192
Share transfer on PLC incorporation 21,828,708 218,288 -
Issued on IPO 4,406,594 44,066 -
As at 31 March 26,344,994 263,451 109,692
Fully paid ordinary shares carry one vote per share and the right to dividends
and to distributions on winding up.
The issued share capital as at 1 April 2021 was the share capital for 4GLOBAL
Consulting Limited which was exchanged for shares in the 4GLOBAL PLC on 11
November 2021.
The Company undertook an IPO on 7 December and issued 4,406,594 shares to
shareholders.
On 15 February 2021, all the A Ordinary Shares, B Ordinary Shares, D Ordinary
Shares and E Ordinary Shares were reclassified as Ordinary Shares of £1 each.
On 8 March 2021, the 945 Ordinary Shares of £1 Nominal Value were subdivided
into 94,500 Ordinary Shares of £0.01 Nominal Value.
On 22 March 2021, 1,686 £0.01 Ordinary Shares were issued for £4.76 per
share following the exercise of share options. Additionally, a further 13,506
£0.01 Ordinary Shares were issued for £85.44 per share.
18. Equity share-based payments
The 4GLOBAL Group bears the expense of equity settled share options granted to
employees and consultants of the 4GLOBAL Group. Share options were awarded
over the shares in 4GLOBAL Consulting Limited to Ian James and Utku
Toprakseven. Ian James was appointed a director of 4GLOBAL Consulting Limited
on 11 February 2021 and Utku Toprakseven on 1 April 2015.
The movements of share options during the year were as follows:
Number of Share options Weighted average share price
As at 1 April 2020 -
4GLOBAL Consulting Limited
Granted during the year 45,954
Exercised during the year (1,686)
Outstanding as at 31 March 2021 44,268 £8.98
Cash settled during the year (44,268)
Outstanding as at 31 March 2022 - £-
Options outstanding at 31 March 2021 had an exercise price of £4.76-£72.62.
The options vest upon certain conditions including a change in ownership of
4GLOBAL PLC.
The number of options exercisable as at 31 March 2022 is nil.
On 22 March 2021 1,686 options were exercised at an exercise price of £4.76.
The Directors waived the vesting requirement of a change in ownership of
4GLOBAL Consulting Limited to allow the exercise. The weighted average share
price at 22 March 2021 was £85.44 per share.
On 7 December 2022 to assist in the IPO the existing options were settled for
a cash amount of £1,000,000.
Number of Share options Weighted average share price
4GLOBAL PLC
Outstanding as at 31 March 2021 - -
Granted during the year 2,305,872 78p
Exercised during the year - -
Outstanding as at 31 March 2022 2,305,872 78p
Options outstanding at 31 March 2022 had an exercise price of 35.6p - 91.0p.
The number of options exercisable as at 31 March 2022 is nil.
The vesting period ranges from 31 March 2023 to 7 December 2024.
The fair value of share options was estimated using the Black-Scholes
option-pricing model. The estimated fair values of options granted are based
on the following weighted average assumptions:
As at the year ended 31 March 2022 2021
Weighted average fair value (£ per option) £0.42 £1.38
Weighted average remaining contractual life 9.7 0.5
The estimated fair values of options granted are based on the following
weighted average assumptions:
As at 31 March 2022 2021
Weighted average share price at date of grant 78p £8.83
Weighted average exercise price 78p £8.83
Expected life (years) 5 0.5
Expected volatility (%) 44.0 59.47
Risk free interest rate (%) 0.76 (0.014)
The volatility assumption, measured at the standard deviation of expected
share price returns, is based on the volatility of a comparable listed
company. The charge for equity-settled share-based payments in the relevant
years is shown in Note 8.
19. Reserves
Share premium
Share premium records the amount above the nominal value received for shares
sold, less transaction costs.
Share option reserve
The share-based payment reserve arises on share options issued by the 4GLOBAL
Group to employees of the 4GLOBAL Group.
Merger reserve
The merger reserve arose on the group reconstruction when a share for share
reconstruction took place and is the difference between the issue price and
the nominal value of shares issued as consideration for the acquisition of
subsidiary undertaking.
Warrant reserve
The warrant reserve arises on the warrants issued by the 4GLOBAL Group to
certain advisers of the 4GLOBAL Group.
Capital redemption reserve
The capital redemption reserve arises on the repurchase of shares.
Currency translation reserve
The currency translation reserve arises on the currency translation of
subsidiaries where the functional currency differs from the functional
currency of the 4GLOBAL Group.
Retained earnings
The retained earnings reserve represents gains and losses recognised in the
consolidated statement of comprehensive income.
20. Trade and other payables
As at 31 March 2022 2021
£ £
Current (Restated)
Trade payables 204,113 82,598
Contract liabilities 216,696 208,215
Payroll taxes, pension & social security 268,398 250,916
Other payables 399,347 422,868
1,088,554 964,597
The carrying values of the trade and other payables approximate to their fair
value as at the year-end date. Other payables include accruals for general
expenses incurred in the normal course of business that are expected to be
settled within 12 months.
21. Borrowings
As at 31 March 2022 2021
£ £
Non-current
Borrowings 158,823 273,458
Current
Borrowings 121,814 45,833
Borrowings includes a loan obtained in May 2020 under the Coronavirus Business
Interruption Loan Scheme ("CBILS") of £250,000. The loan is repayable in
monthly instalments by April 2026. The rate of interest applicable to the loan
is 3.05% plus the Bank of England base rate. Under the scheme, the government
has given a grant of the amounts of interest that would arise on the loan for
the first 12 months (see note 7). This amount has been recognised in Other
Operating Income. The Company has granted a fixed and floating charge over its
assets in respect of this loan. A partial guarantee has been provided by the
government.
Borrowings also includes a loan of £50,400 from Eloy Mazon, a director and
shareholder of the Company. The loan was drawn down between December 2013 and
September 2014 and bears interest at 5% plus the Bank of England base rate,
which has been accrued with the loan. Interest is charged on the capital and
outstanding interest. The balance outstanding at 31 March 2022 was £70,804.63
(2021: £69,293.43). The loan is repayable on demand. The loan was repaid in
June 2022.
The carrying value of borrowings approximates to their fair value as at the
year-end date.
22. Lease liabilities
2022 2021
£ £
As at 1 April 281,676 -
Additions 439,987 411,571
Interest expense 10,780 13,705
Payment of interest (10,780) (13,705)
Payment of principal (186,470) (129,895)
Disposal (181,382) -
As at 31 March 353,811 281,676
The 4GLOBAL Group has lease contracts for land and buildings. The 4GLOBAL
Group does not have any leases where the 4GLOBAL Group is a lessor. The
weighted average remaining term of all leases is disclosed below. The lease
agreements do not impose any covenants other than the security interests in
the leased assets that are held by the lessor. Leased assets may not be used
as security for borrowing purposes. The land and buildings leases have been
discounted at the 4GLOBAL Group's incremental borrowing rate of 4.1%.
The 4GLOBAL Group has identified four leases with lease terms of 12 months or
less. The 4GLOBAL Group applies the short-term lease recognition exemption for
these leases. The expense recognised in respect of these leases is disclosed
in Note 8.
2022 2021
£ £
Maturity analysis of leases
Current 353,811 134,403
1 to 2 years - 147,273
353,811 281,676
As at As at
31 March 2022 31 March 2021
Years years
Weighted average remaining term 1 2
23. Financial instruments
The 4GLOBAL Group's treasury policy is to avoid transactions of a speculative
nature. In the course of trade the 4GLOBAL Group is exposed to a number of
financial risks that can be categorised as market, credit and liquidity risks.
The Board has identified the risks within each category and considers the
impact on the activities of the 4GLOBAL Group as part of their regular meeting
routine.
Principal financial instruments
The principal financial instruments used by the 4GLOBAL Group, from which
financial instrument risk arises, are as follows:
Trade and other receivables
Cash and cash equivalents
Trade and other payables
Borrowings
Lease liabilities
A summary of the financial instruments held by category is provided below:
As at 31 March 2022 As at 31 March 2021
£ £
Financial assets at amortised cost
Cash and cash equivalents 3,050,948 775,342
Trade and other receivables 1,012,720 1,730,356
Total financial assets 4,063,668 2,505,698
The fair value of short-term deposits and other financial assets approximates
to the carrying amount.
2022 2021
Financial liabilities at amortised cost Restated
Borrowings 280,637 319,291
Trade and other payables 588,535 505,466
Lease liabilities 353,811 281,676
1,222,983 1,106,433
The Directors consider that the carrying amounts of all financial assets and
financial liabilities recognised in the financial information approximate
their fair values (due to their nature and short times to maturity).
Currency risk
The 4GLOBAL Group's financial risk management objective is broadly to seek to
make neither profit nor loss from exposure to currency or interest rate risks.
The 4GLOBAL Group is exposed to transactional foreign exchange risk and takes
profits and losses as they arise, as in the opinion of the Directors, the cost
of hedging against fluctuations would be greater than the related benefit from
doing so.
The 4GLOBAL Group has no trade and other payables denominated in the
currencies other than pounds sterling.
The trade and other receivables balances held by the 4GLOBAL Group in
currencies other than pounds sterling are as follows:
As at 31 March 2022 As at 31 March 2021
£ £
Euro 1,241 1,115
New Zealand Dollar 11,425 -
Saudi Arabian Riyal - 34,631
United States Dollar 70,653 -
83,319 35,746
The cash balances held by the 4GLOBAL Group in currencies other than pounds
sterling are as follows:
As at 31 March 2022 As at 31 March 2021
£ £
Saudi Arabian Riyal 10,655 423,294
Euro 14,182 -
US Dollar 3,339 -
Turkish Lira 18,974 17,546
47,150 440,840
Foreign currency sensitivity analysis
A 10% movement in the relevant foreign currency exchange rates would
increase/(decrease) net assets as shown below. This analysis assumes that all
other variables, in particular interest rates, remain constant.
TRY USD EUR NZD
As at 31 March 2020 £ £ £ £
Effect on net assets:
GBP strengthened by 10% (931) (2,603) (10,287) (14,228)
GBP weakened by 10% 1,138 3,181 12,573 17,390
TRY SAR
As at 31 March 2021 £ £
Effect on net assets:
GBP strengthened by 10% (1,595) (41,630)
GBP weakened by 10% 1,950 50,881
TRY USD EUR SAR
As at 31 March 2022 £ £ £ £
Effect on net assets:
GBP strengthened by 10% (1,725) (295) (1,321) (975)
GBP weakened by 10% 2,108 381 1,537 1,176
Credit risk
Credit risk is the risk that a customer or counterparty to a financial
instrument will fail to perform or fail to pay amounts due causing financial
loss to the 4GLOBAL Group. Credit risk within the 4GLOBAL Group arises from
cash and cash equivalents, and trade and other receivables. The maximum
exposure to credit risk is the carrying amount of these financial instruments.
The 4GLOBAL Group is subject to concentrations of credit risk from cash
deposits in excess of insured limits. The 4GLOBAL Group places its cash in
financial institutions which are considered high quality financial
institutions by management. At times, such cash deposits may be in excess of
insured limits. The 4GLOBAL Group does not enter into any derivatives to
manage credit risk.
The 4GLOBAL Group calculates expected loss allowances based on the maximum
contractual year over which the 4GLOBAL Group is exposed to credit risk.
Financial assets are considered to be credit-impaired when there is reasonable
and supportable evidence that one or more events that have a detrimental
impact on the estimated future cash flows of the financial asset have
occurred. The 4GLOBAL Group also applies a rebuttable presumption that an
asset is credit-impaired when contractual payments are more than 30 days past
due. The 4GLOBAL Group has made an assessment of whether trade receivables are
credit-impaired as each of the years in question. The 4GLOBAL Group has taken
into account the current financial position of counterparties and expected
future cash flows together with actual and forecast financial information, in
order to estimate the probability of default of each of these financial assets
as well as the loss upon default. No provision for expected credit losses has
been made.
The contractual cash flows on these financial assets have not been modified or
renegotiated in the current or prior year.
If there is evidence that there is no reasonable expectation of recovery and
the counterparty is in severe financial difficulties, the financial asset will
be written off.
The following table provides an analysis of trade receivables that were due,
but not impaired, at each financial year end. The Group believes that the
balances are ultimately recoverable based on a review of past impairment
history and the current financial status of customers.
As at 31 March 2022 As at 31 March 2021
£ £
Current 1 - 30 days 412,666 292,901
30 - 60 days 162,935 136,627
61 - 90 days 110,483 2,379
91 + days 80,102 20,884
Provision for impairment of trade receivables (12,941) (2,260)
Total trade receivables - net 753,245 450,531
The Directors are unaware of any factors affecting the recoverability of
outstanding balances at 31 December 2021 and, consequently, no further
provisions have been made for bad and doubtful debts.
The allowance for bad debts has been calculated using a 12-month lifetime
expected credit loss model, as set out below, in accordance with IFRS 9.
As at 31 March 2022 As at 31 March 2021
£ % £ £ % £
Current 1 - 30 days 412,666 292,901
31 - 60 days 162,935 136,627
61 - 90 days 110,483 2,379
91 + days 80,102 16% (12,941) 20,884 11% (2,260)
Credit Quality of Financial Assets
As at 31 March 2022 As at 31 March 2021
Past due not impaired £ £
Current 412,666 292,901
31 - 90 days 273,418 139,006
Over 91 days - no impairment 67,161 18,624
Total past due not impaired 753,245 450,531
Liquidity risk
The 4GLOBAL Group is exposed to liquidity risk as part of its normal trading
cycle. The 4GLOBAL Group's policies ensure sufficient liquidity is available
to meet foreseeable needs through the preparation of short and long-term
forecasts. The 4GLOBAL Group's requirements are constant throughout the year
and relate largely to working capital which is managed through the use of
surplus cash.
The table below summarises the maturity profile of the 4GLOBAL Group's
financial liabilities, based on contractual, undiscounted payments:
Less than 1 year 2 to 5 years More than 5 years Total
Year ended 31 March 2021 £ £ £ £
Borrowings 45,833 269,291 4,167 319,291
Trade and other payables 505,466 - - 505,466
Lease liabilities 134,403 147,273 - 281,676
685,702 416,564 4,167 1,106,433
Less than 1 year More than 5 years
2 to 5 years Total
Year ended 31 March 2022 £ £ £ £
Borrowings 121,814 158,823 - 280,637
Trade and other payables 588,535 - - 588,535
Lease liabilities 353,811 - - 353,811
1,064,160 158,823 - 1,222,983
Capital risk
The Directors define capital as the total equity of the company. The
Directors' objectives when managing capital are to safeguard the 4GLOBAL
Group's ability to continue as a going concern in order to provide returns for
stockholders and benefits for other stakeholders and to maintain an optimal
structure to reduce the cost of capital. In order to maintain an optimal
capital structure, the Directors may adjust the amount of dividends paid to
stockholders, return capital to stockholders and issue new stock to reduce
debt.
24. Net funds reconciliation
As at 31 March 2022 As at 31 March 2021
£ £
Cash and cash equivalents 3,050,948 775,342
Borrowings - repayable within one year 121,814 45,833
Borrowings - repayable after one year 158,823 273,458
Net funds 3,331,585 1,094,633
Cash and liquid investments 3,050,948 775,342
Gross debt - variable interest rates 280,637 319,291
Net funds 3,331,585 1,094,633
25. Commitments
The 4GLOBAL Group has not identified any lease contracts that have not yet
commenced as at the end of each year. Consequently, the 4GLOBAL Group has not
identified any material commitments.
26. Ultimate controlling party
As at 31 March 2022, the ultimate controlling party of the 4GLOBAL Group is
Eloy Mazon by virtue of his 50.5% shareholding in 4GLOBAL PLC.
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. END FR DZGGNGVDGZZZRecent news on 4Global
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