REG - Aquis Exchange PLC - Interim Results
22/09/2022 07:00
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RNS Number : 2239A Aquis Exchange PLC 22 September 2022
22 September 2022
Aquis Exchange PLC
("Aquis", the "Company" or the "Group")
Interim results for the six months ended 30 June 2022
Continued revenue growth and investment in the future
Aquis Exchange PLC (AQX.L), the exchange services group, is pleased to
announce its unaudited results for the six months ended 30 June 2022.
Highlights:
All three divisions were profitable in the period.
· Net Revenue (1) increased 21% to £8.3 million (1H21: £6.9 million)
· EBITDA at £1.4 million (1H21: £1.6 million) following a significant
investment in technology and development headcount to drive future growth
· Pre-tax profit of £0.7 million (1H21: £1.0 million)
· Cash and cash equivalents at 30 June 2022 of £13.3 million (30 June 2021:
£13.9 million)
· Membership of Aquis Exchange (AQX) grew to 42 (1H21: 39), with a small decline
in average monthly usage reflecting more volatile market conditions
· Market share of all pan-European trading ended the period at 5.20% in 2Q22
(4Q21: 5.35%)
· 12 new admissions to Aquis Stock Exchange (AQSE) completed during 1H22 (1H21:
14))
· Signature of a new significant multi-year technology licence contract
· Aquis Matching Pool (AMP) successfully launched following the asset purchase
from UBS on 4 April 2022, with average monthly market share of c. 0.5% added
to the Group total share
Post-period highlights:
· Currently tracking in line with market expectations for the full year
· Signature of an additional new significant multi-year technology licence
contract
Alasdair Haynes, Chief Executive Officer of Aquis, commented:
"Our revenues have continued to increase, reflecting the strong momentum
across the Group. This growth has been driven by increased contributions from
the principal business divisions: pan-European secondary trading, technology
sales, primary issuers and data revenues. The continued strength of our
offering in this division is demonstrated by our finishing with 5.20% of all
pan-European secondary trading by the end of 2Q22. We are also particularly
encouraged by the number of new significant technology licenses that continue
to be signed as this growing division becomes an increasingly material and
important part of our business.
Aquis also successfully completed the asset purchase of the Aquis Matching
Pool from UBS and is now able to offer a full product suite to its customers.
We will continue to enhance this area and look forward to offering further
product innovation in this space to enable clients to execute the trading
strategies they wish.
While we anticipate the prevailing economic uncertainty will continue to
impact market participants in the short to medium term, we have demonstrated
we have the right model, team, technology and vision to deliver shareholder
value and look to the future with confidence."
An overview of the results from Alasdair Haynes, CEO, is available to view on
this link:
https://www.brrmedia.co.uk/broadcasts-embed/
(https://www.brrmedia.co.uk/broadcasts-embed/632b0819c058677fd8212758/aquis-exchange-plc-half-year-results-highlights/?popup=true)
The Group will be hosting webinars for analysts and retail investors today at
9.30 and 14.30 respectively.
If you would like to register for the analyst webinar, please
contact aquis@almapr.co.uk (mailto:aquis@almapr.co.uk) . Investors who
would like to attend the retail investor webinar can sign up to Investor Meet
Company for free and add themselves to the meeting
via https://www.investormeetcompany.com/aquis-exchange-plc/register-investor
(https://www.investormeetcompany.com/aquis-exchange-plc/register-investor) .
Investors who have already registered will be automatically invited.
(1) Net revenue of £8.3m comprises revenues of £7.9m and impairment
credit of £0.4m
Enquiries:
Aquis Exchange PLC Tel: +44 (0) 20 3597 6321
Alasdair Haynes, CEO
Richard Fisher, CFO
Andrea Lee
VSA Capital Limited (AQSE Corporate Adviser) Tel: +44(0)20 3005 5000
Andrew Raca
Pascal Wiese
Alma PR (Financial PR Adviser) Tel: +44 (0) 20 3405 0209
Caroline Forde
Kieran Breheny
Lily Soares Smith
Pippa Crabtree
Liberum Capital Limited (Nominated Adviser and Joint Broker) Tel: +44 (0) 20 3100 2000
Chris Clarke
Clayton Bush
Edward Thomas
Kane Collings
Canaccord Genuity Limited (Joint Broker) Tel: +44 (0) 20 7523 8000
Emma Gabriel
Patrick Dolaghan
Notes to Editors
About Aquis Exchange PLC
Aquis Exchange PLC and its subsidiaries are an exchange services group, which
operate a pan-European cash equities trading businesses (Aquis Exchange), a
growth and regulated primary market (Aquis Stock Exchange/AQSE) and
develop/license exchange software to third parties (Aquis Technologies).
Aquis Exchange is authorised and regulated by the UK Financial Conduct
Authority and France's Autorité des Marchés Financiers to operate
Multilateral Trading Facility businesses in the UK/Switzerland and in EU27
respectively. Aquis Exchange operates lit and dark order books, covering 16
European markets. For its lit books, Aquis Exchange uses a subscription
pricing model which works by charging users according to the message traffic
they generate, rather than a percentage of the value of each stock that they
trade and does not allow aggressive non-client proprietary trading, which has
resulted in lower market impact and signalling risk on Aquis Exchange than
other trading venues in Europe.
Aquis Stock Exchange (AQSE) is a stock market providing primary and secondary
markets for equity and debt products. It is authorised as a Recognised
Investment Exchange, which allows it to operate a regulated listings venue.
The AQSE Growth Market is divided into two segments 'Access' and 'Apex', with
different levels of admission criteria. The Access market focuses on earlier
stage growth companies, while Apex is the intended market for larger, more
established businesses.
Aquis Technologies is the software and technology division of Aquis Exchange
PLC. It creates and licenses cutting-edge, cost-effective matching engine and
trade surveillance technology for banks, brokers, investment firms and
exchanges.
Aquis Exchange PLC is quoted on the Aquis Stock Exchange and on the
Alternative Investment Market of the LSE (AIM) market. For more information,
please go to www.aquis.eu (http://www.aquis.eu/) .
Chief Executive Officer's Report
The six months to 30 June 2022 has been another strong period of growth as
we build on the revenues achieved during 2021. In addition, we have made good
operational progress in all areas to help drive us towards our long-term
goals. The fact that we have achieved all this amidst the continued
challenging economic circumstances demonstrates our strong operational
resilience and the continued demand for our unique offering.
We are very pleased to have acquired and smoothly integrated the Aquis
Matching Pool ("AMP") into our suite of product offerings.
Operational Review
Aquis continued to develop its three divisions throughout the period:
· Aquis Exchange (AQX): its pan-European lit equities market; which
now includes its dark pool vehicle AMP;
· Aquis Stock Exchange (AQSE): a primary listings market for small
and mid-cap companies;
· Aquis Technologies: a multi-asset class technology licensing
service to an international client base
The Group's Market Data income stream (generated through the sale of AQX and
AQSE data) has continued to grow during the period.
This has enabled us to continue our strong growth as synergies are developed
and the business potential is harnessed.
In the last six months we have accelerated our planned investment in key
business areas such as growing our technology development team. This
investment both allows us to maintain our internally used Aquis technology set
and will help drive the ongoing growth in our technology licencing business.
The Exchanges
The performance of both Aquis Exchange and Aquis Stock Exchange has progressed
well. Exchange revenue increased by £0.5m (10%) from £4.9 million to £5.4
million and the number of Members grew from 39 to 42. Aquis Exchange Members
decreased their trading volumes in the period, with an 8% softening in the
average monthly usage in terms of chargeable orders (2Q 2022 vs 4Q 2021),
reflecting the prevailing volatile market conditions. Despite this reduction
the number of monthly subscriptions slightly rose. On average, there were nine
Members using the top three (four post new top tier in May) subscription
pricing tiers and 24 in the other five tiers, with nine liquidity providers.
Issuer revenue increased, reaching £0.4million as the number of admissions on
AQSE grew year-on-year.
As the business moves forward, we anticipate AQSE and AQX will become
increasingly integrated, allowing Members to benefit from the breadth of the
Group's offering.
Aquis Exchange
Continued revenue growth in the core business despite tough market conditions
Aquis Exchange (AQX) is the Group's pan-European lit secondary trading
equities market. It comprises the UK MTF (AQXE) and the French MTF serving EU
markets (AQEU).
Aquis Exchange's market share of all pan-European trading had declined during
the end of 2021 and start of 2022 but has averaged in excess of this level
during the period since the half year close, reflecting an improved
performance and also the inclusion of market share from AMP. Total market
share was 5.2% by close of 2Q22 (5.35% 4Q21, 5.77% 2Q21).
Aquis Matching Pool: Following the acquisition of the UBS MTF, Aquis is
pleased to note the seamless transition of activity with the number of members
and levels of trading experienced to date post acquisition consistent on that
previously seen, with Management confident that future opportunities to grow
from this current base are available through 2022 and beyond.
Aquis Exchange currently has an offering
in excess of 2,100 stocks and ETFs across 16 European markets with
the Czech market added in the period. A significant proportion of Exchange
activity is now being executed on AQEU, the Group's French MTF serving EU
markets.
Available liquidity on the exchange was at 23% in 1H22 (22% in 1H21) and it is
expected this will continue to underpin future anticipated growth.
The recognition that Aquis Exchange's toxicity is materially lower than its
competitors continues to grow amongst investment managers and the wider
market. With several market drivers pushing market participants
towards lower toxicity, the opportunity for Aquis Exchange to attract a wider membership from across Europe and
to facilitate increased trading volumes remains significant.
Aquis Stock Exchange (AQSE)
Momentum building despite difficult market conditions
AQSE is a modern market for modern businesses, bringing positive disruption
and competition to the listed SME sector. As one of the only two existing
options for growing SMEs looking to IPO in the UK, Aquis' vision is for AQSE
to become the home for quality growth businesses, applying core Aquis values
such as transparency and innovation.
12 admissions were completed during 1H22 (joint with our principal competitor)
compared to 14 during 1H21. All were well supported and there is a very strong
pipeline of high growth and 'new economy' businesses in conversation with AQSE
regarding IPO.
Revenue growth coupled with achieving the targeted cost synergies and savings
has significantly reduced the loss generated by AQSE such that the division is
currently forecast to at least break even for the financial year 2022.
Aquis Technologies
Progress made on a number of projects
Aquis licenses its leading exchange-related technology through its Aquis
Technologies division. Aquis Technologies creates and licenses technology for
high volume, low latency trading platforms, complex connectivity solutions
and real-time trade monitoring and surveillance systems for banks, brokers, investment firms and exchanges.
Aquis recognises license revenue on completion of project delivery in
accordance with IFRS accounting statutes, which can lead to lumpy revenue
recognition, period on period. During 1H22 significant progress was made on a
number of projects; and Aquis notes one new contract has been signed in the
period, and a further one prior to this results announcement however, there
were no completed projects during the period, consistent on 1H21. As a result,
Aquis Technologies' revenue (net of provision releases) is below that
recognised in 2H21, but remains significantly above that recognised in 1H21,
increasing to £1.1m (1H21: £0.6m) net of provisions.
The successful exchange cloud technology Proof of Concept (PoC) completed in
2021 has continued to demonstrate the quality of the Aquis Technologies
offering and has resulted in a number of new exchange platform prospects. The
investment we have made in the first half of 2022 has allowed us to further
develop our innovative technology which is at the core of Aquis Technologies,
and we will be focused on furthering the growth of the Technologies division,
developing its products and services to help its clients with the challenges
they face and ensuring the high-performance systems continue to be enhanced.
Aquis Market Data
Aquis generates revenue from the sale of data derived from AQX (AQXE &
AQEU) and AQSE to non-Member market participants.
Revenue from market data vendors increased significantly by £0.3m, 29%, to
£1.4m for the six-month period compared to the 2021 equivalent, with
continued growth in both terminal use and non-display licences across the
period.
Financial Review
Net revenue increased 21% to £8.3m (1H21: £6.9m) and
the EBITDA profit for the half year was £1.4m, broadly in line with the
EBITDA profit of £1.6m generated in 1H21. This EBITDA profit and the profit
before tax of £0.7m includes £0.4m of income recognised from an impairment
credit per IFRS 9 consistent with the 1H21 impairment credit. The EBITDA has
remained broadly consistent as the Group made some controlled increases in
costs during both in 1H 2022 and the back end of last year as it continued to
invest in personnel and technological resources. The Group will continue to
invest in the future to maintain the business' growth momentum.
The Group's cash and cash equivalents as at 30 June 2022 were £13.3 million
(30 June 2021: £13.9 million).
Summary and Outlook
Our strategic goal remains to become one of the leading exchange groups
through delivering best-in-class trading opportunities, underpinned by our
commitment to first class client service, transparency, simplicity and
best-in-class technology. To this end, our investment in R&D will help
improve the trading experience for clients, as well as improving our market
position and providing further growth and value creation for shareholders. We
continue to make significant investment in our technology, sales and marketing
activities, in particular in cloud technology, to support our long-term growth
aspirations across all activities.
Alongside this we are working to enhance our software licensing activities and build presence internationally.
We are pleased to have made significant progress on a number of material
technology contracts post-period end that will support the second half
performance and into FY23, as this growing division becomes an increasingly
important part of our business.
Looking forward, our focus continues to be on executing on our core growth
strategy; increasing trading volumes and improving fundraising prospects for
small and mid-cap companies. Notwithstanding the macroeconomic uncertainty,
current trading is tracking in line with market expectations for the full
year.
We have built good momentum over the past few years, despite facing numerous
challenges along the way. This demonstrated the strength of our team and our
offering, and I am excited to see what we can achieve across the next six
months.
Alasdair Haynes
Chief Executive Officer
AQUIS EXCHANGE PLC
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE SIX MONTHS
ENDED 30 JUNE 2022
6 months ended 30/06/2022 Year ended 31/12/2021 6 months ended 30/06/2021
Note £'000 £'000 £'000
Income Statement
Revenue 3 7,849 17,182 6,687
Impairment credit/(charge) 4 425 (972) 178
Administrative expenses (6,912) (11,930) (5,299)
Operating profit 1,362 4,280 1,566
Investment income 5 4 - -
Depreciation and amortisation 7,8 (632) (1,032) (543)
Net finance costs 18 (35) (26) (15)
Profit before taxation 699 3,222 1,008
Income tax - - -
Deferred tax - 1,089 -
Profit after taxation 699 4,311 1,008
Other comprehensive income
Items that may be reclassified subsequently to
profit or loss:
Foreign exchange differences on translation of foreign operations, net of tax 17 (42) 77 4
Other comprehensive loss for the year (42) 77 4
Total comprehensive profit for the year 657 4,388 1,012
Earnings per share (pence) 6
Basic
Ordinary shares 3 16 4
Diluted
Ordinary shares 2 15 3
The consolidated statement of comprehensive income has been prepared on the
basis that all operations are continuing operations.
AQUIS EXCHANGE PLC
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2022
6 months ended 30/06/2022 Year ended 31/12/2021 6 months ended 30/06/2021
Note £'000 £'000 £'000
Assets
Non-current assets
Goodwill 7 83 83 83
Intangible assets 7 772 754 792
Property, plant and equipment 8 4,263 4,146 1,488
Deferred tax asset 10 1,292 1,292 204
Trade and other receivables 9 4,714 2,745 915
11,124 9,020 3,482
Current assets
Trade and other receivables 9 2,786 3,769 3,523
Cash and cash equivalents 13,320 14,046 13,860
16,106 17,815 17,383
Total assets 27,230 26,835 20,085
Liabilities
Current liabilities
Trade and other payables 11 4,453 3,783 2,792
Non-current liabilities
Lease liabilities 18 3,214 3,423 953
Total liabilities 7,667 7,206 3,745
Net assets 19,563 19,629 17,120
Equity
Called up share capital 12 2,751 2,751 2,749
Share premium account 13 11,780 11,771 11,738
Other reserves 14 1,860 1,118 1,055
Treasury shares 16 (3,001) (1,527) (561)
Retained earnings 15 6,137 5,438 2,135
Foreign currency translation reserve 17 36 78 4
Total equity 19,563 19,629 17,120
The notes to the financial statements on pages 6 to 16 form an integral part
of these financial statements. The interim financial statements were approved
by the board of directors and authorised for issue on 22 September 2022 and
are signed on its behalf by:
R Fisher A Haynes
Director Director
AQUIS EXCHANGE PLC
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE SIX MONTHS ENDED
30 JUNE 2022
Note Share Capital Share Premium Other Reserves Retained Earnings Foreign Currency Translation Reserve Total
Treasury Shares
£'000 £'000 £'000 £'000 £'000 £'000
£'000
Balance at 1 January 2021 2,717 10,892 761 15,008
(490) 1,127 1
Profit for the 6-month period ended 30/06/2021 1,008 1,008
Issue of new shares 32 846 878
Movement in share option reserve 294 294
Movement in treasury shares (71)
(71)
Foreign exchange differences on translation of foreign operations 3
3
Balance at 30 June 2021 2,749 11,738 1,055 2,135 4 17,120
(561)
Profit for the 6 month period ended 3,303 3,303
31/12/2021
Issue of new shares 2 33 35
Movement in share option reserve 63 63
Movement in Treasury Shares (966) (966)
Foreign exchange differences on 74
translation of foreign operations 74
Balance at 31 December 2021 2,751 11,771 1,118 (1,527) 5,438 78 19,629
Profit for the 6-month period ended 699 699
30/06/2022
Issue of new shares 12,13 9 9
Movement in share option reserve 14 742 742
Movement in treasury shares 16 (1,474)
(1,474)
Foreign exchange differences on translation of foreign operations 17 (42)
(42)
Balance at 30 June 2022 2,751 11,780 1,860 19,563
(3,001) 6,137 36
AQUIS EXCHANGE PLC
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE SIX MONTHS ENDED 30
JUNE 2022
Note 6 months ended 30/06/2022 Year ended 31/12/2021 6 months ended 30/06/2021
£'000 £'000 £'000
Cash flows from operating activities
Cash generated/absorbed by operations 19 1,066 3,157 1,215
Tax refunded - - -
Finance expense on lease liabilities 18 35 (26) (15)
Net cash inflow from operating activities 1,101 3,131 1,200
Investing Activities
Recognition of intangible assets 7 (281) (350) (154)
Purchase of property, plant and equipment 8 (478) (320) (163)
Interest received 5 4 - -
Net cash used in / generated by investing activities (755) (670) (388)
Financing Activities
Proceeds from share issue 12,13 9 913 878
Purchase of treasury shares 16 (1,000) (1,100) (71)
Principal portion of lease liability 18 (39) (573) (101)
Net cash (used in)/ generated by financing activities (1,030) (760) 777
Net increase/(decrease) in cash and cash equivalents (684) 1,701 1,589
Cash and cash equivalents at the beginning of the period 14,046 12,268 12,268
Effect of exchange rate changes on cash and cash equivalents (42) 77 3
Cash and cash equivalents at the end of the period 13,320 14,046 13,860
AQUIS EXCHANGE PLC
NOTES TO THE FINANCIAL STATEMENTS
1. Basis of preparation of half-year report
This condensed consolidated interim financial report for the half-year
reporting period beginning 1 January 2022 and ending 30 June 2022 ("interim
period") has been prepared in accordance with Accounting Standard IAS 34
Interim Financial Reporting.
The interim report does not include all the notes of the type normally
included in an annual financial report. Accordingly, this report is to be read
in conjunction with the annual report for the year ended 31 December 2021 and
any public announcements made by Aquis Exchange PLC ("Aquis" or the "Company")
during the interim reporting period.
The accounting policies adopted are consistent with those of the previous
financial year and corresponding interim reporting period.
2. Significant changes in the current reporting period
The financial position and performance of the Group was not affected by any
specific events and transactions during the six months to 30 June 2022.
However, it is worth noting the following:
· On 4 April 2022, the group assumed the business activities of UBS
MTF, the non-displayed matching pool. This initiative represented a
significant extension of the equities trading services the group offers its
clients and complements its existing suite of lit liquidity pools and range of
order types.
3. Revenue
An analysis of the Group's revenue is as follows:
6 months ended 30/06/2022 Year ended 31/12/2021 6 months ended 30/06/2021
£'000 £'000 £'000
Exchange Fees 5,387 9,766 4,899
Licence Fees 662 4,405 379
Issuer Fees 424 2,319 340
Data Vendor Fees 1,376 692 1,069
7,849 17,182 6,687
AQUIS EXCHANGE PLC
NOTES TO THE FINANCIAL STATEMENTS (continued)
4. Expected credit loss
The expected credit loss on licensing contract assets has been calculated in
accordance with IFRS 9:
£'000
As at 31/12/2020 508
Expected credit loss reversal for the period (178)
As at 30/06/2021 330
Expected credit loss charge for the period 1,150
As at 31/12/2021 1,480
Expected credit loss reversal for the period (425)
As at 30/06/2022 1,055
5. Investment income
6 months ended 30/06/2022 Year ended 31/12/2021 6 months ended 30/06/2021
£'000 £'000 £'000
Interest income on bank deposits 4 0 0
6. Earnings per share
6 months ended 30/06/2022 Year ended 31/12/2021 6 months ended 30/06/2021
Number of Shares ('000)
Weighted average number of ordinary shares for basic earnings per share 27,509 27,340 27,197
Weighted average number of ordinary shares for diluted earnings per share 28,431 28,457 28,638
Earnings (£'000)
Profit for the period from continued operations 699 4,311 1,008
Basic and diluted earnings per share (pence)
Basic earnings per ordinary share 3 16 4
Diluted earnings per ordinary share 2 15 3
AQUIS EXCHANGE PLC
NOTES TO THE FINANCIAL STATEMENTS (continued)
7. Intangible assets
Group Developed Trading Platforms Other Intangibles
Goodwill
£'000 £'000
£'000
Cost
As at 31/12/2020 2,698 - 83
Additions- internally generated 154 - -
As at 30/06/2021 2,852 - 83
Additions - internally generated 159 37 0
As at 31/12/2021 3,011 37 83
Additions 282 - -
As at 30/06/2022 3,293 37 83
Accumulated amortisation and impairment
As at 31/12/2020 1,782 - -
Charge for the period 278 - -
As at 30/06/2021 2,060 - -
Charge for the period 226 - -
As at 31/12/2021 2,286 8
Charge for the period 258 6 -
As at 30/06/2022 2,544 14 -
Carrying amount
As at 31/12/2020 916 - 83
As at 30/06/2021 792 - 83
As at 31/12/2021 725 29 83
As at 30/06/2022 749 23 83
AQUIS EXCHANGE PLC
NOTES TO THE FINANCIAL STATEMENTS (continued)
8. Property, plant and equipment
Fixtures, fittings and equipment Computer Equipment Right of Use Asset Total
£'000 £'000 £'000 £'000
Cost
As at 31/12/2020 252 2,211 1,444 3,907
Additions & disposals - 163 - 163
As at 30/06/2021 252 2,374 1,444 4,070
Additions & disposals 72 15 2,795 2,882
As at 31/12/2021 324 2,389 4,329 6,952
Additions & disposals 168 312 - 480
As at 30/06/2022 492 2,701 4,239 7,432
Accumulated depreciation and impairment
As at 31/12/2020 178 1,804 346 2,328
Charge for the period 25 142 87 254
As at 30/06/2021 203 1,946 433 2,582
Charge for the period 27 129 68 224
As at 31/12/2021 230 2,075 501 2,806
Charge for the period 38 152 173 363
As at 30/06/2022 268 2,227 674 3,169
Carrying amount
As at 31/12/2020 74 407 1,098 1,579
As at 30/06/2021 49 428 1,011 1,488
As at 31/12/2021 94 314 3,738 4,146
As at 30/06/2022 224 474 3,565 4,263
AQUIS EXCHANGE PLC
NOTES TO THE FINANCIAL STATEMENTS (continued)
9. Trade and other receivables
Current
As at 30/06/2022 As at 31/12/2021 As at 30/06/2021
£'000 £'000 £'000
Trade receivables net of impairment 2,096 2,997 2,918
Prepayments 683 433 598
Other receivables 7 339 7
2,786 3,769 3,523
Non-Current
As at 30/06/2022 As at 31/12/2021 As at 30/06/2021
£'000 £'000 £'000
Trade receivables net of impairment 4,079 2,416 690
Other receivables 635 329 225
4,714 2,745 915
Trade receivables are stated net of any credit impairment provision as set out
previously in Note 3 in accordance with IFRS 9, as illustrated below:
As at 30/06/2022 As at 31/12/2021 As at 30/06/2021
£'000 £'000 £'000
Gross trade receivables 7,311 6,940 3,957
Expected credit losses on contract assets (1,055) (1,527) (349)
Provisions against trade receivables (81) - -
Trade receivables net of impairment 6,175 5,413 3,608
Impairment includes the expected credit loss on licencing contract assets
stated in Note 4.
AQUIS EXCHANGE PLC
NOTES TO THE FINANCIAL STATEMENTS (continued)
10. Deferred tax asset
A deferred tax asset was recognised in the year ended 31 December 2020, due to
the Group becoming profitable for the first time. The Group is expected to
continue to be profitable in future years, with the value of the deferred tax
asset to be reassessed annually at year end.
As at 30/06/2022 As at 31/12/2021 As at 30/06/2021
£'000 £'000 £'000
Deferred tax asset 1,292 1,292 204
11. Trade and other payables
As at 30/06/2022 As at 31/12/2021 As at 30/06/2021
Trade payables 499 171 264
Accruals 1,048 1,811 1,028
Social security and other taxation 782 507 190
Deferred revenue 1,604 883 935
Short term lease liabilities 435 208 -
Other payables 85 203 375
4,453 3,783 2,792
12. Called up share capital
As at 30/06/2022 As at 31/12/2021 As at 30/06/2021
£'000 £'000 £'000
Ordinary share capital
Issued and fully paid
27,149,559 Ordinary shares of 10p each 2,751 2,717 2,717
Issue of new shares following exercise of 323,267 EMI share options - - 32
Issue of new shares following exercise of 20,137 EMI share options - 34 -
Ordinary share capital 2,751 2,751 2,749
AQUIS EXCHANGE PLC
NOTES TO THE FINANCIAL STATEMENTS (continued)
13. Share premium account
As at 30/06/2022 As at 31/12/2021 As at 30/06/2021
£'000 £'000 £'000
Share premium
At beginning of year 11,771 10,892 10,892
Issue of new shares following exercise of 323,267 EMI share options - - 846
Issue of new shares following exercise of 20,137 EMI share options - 879 -
Issue of new shares following exercise of 2,666 EMI share options 9 - -
Share premium 11,780 11,771 11,738
14. Other Reserves
£'000
As at 31/12/2020 761
Share-based payment expense for the 6-month period ended 30/06/2021 294
As at 31/06/2021 1,055
Share-based payment expense for the 6-month period ended 31/12/2021 63
As at 31/12/2021 1,118
Share-based payment expense for the 6-month period ended 30/06/2022 742
As at 30/06/2022 1,860
The reserves relating to share-based payments reflects the estimated value of
the approved employee share option schemes, which include the EMI, CSOP, PPO
and Restricted Share options. The valuation of the options granted is
estimated using a US binomial or Black Scholes model. Also included in the
share-based payment reserve are the treasury shares purchased by the Trust
under the Share Incentive Plan.
AQUIS EXCHANGE PLC
NOTES TO THE FINANCIAL STATEMENTS (continued)
15. Retained earnings
£'000
As at 31/12/2020 1,127
Profit for the 6-month period ended 30/06/2021 1,009
As at 31/06/2021 2,136
Profit for the 6-month period ended 30/12/2021 3,302
As at 31/12/2021 5,438
Profit for the 6-month period ended 30/06/2022 699
As at 30/06/2022 6,137
16. Treasury shares
Treasury shares are purchased by a Trust under the Employee Share Plans. The
Trust is consolidated within the Group financial statements and the value of
the shares held at the balance sheet date is shown below.
As at 30/06/2022 As at 31/12/2021 As at 30/06/2021
£'000 £'000 £'000
Share premium
At beginning of period 1,527 561 490
Purchase of treasury shares 1,474 966 71
Treasury shares at close of period 3,001 1,527 561
17. Foreign currency translation reserve
The translation of the European subsidiary into the functional currency of the
group results in foreign exchange differences that have been recognised in
Other Comprehensive Income ('OCI') for the group which have been accumulated
in a separate component of equity as illustrated below.
6 months ended 30/06/2022 Year ended 31/12/2021 6 months ended 30/06/2021
£'000 £'000 £'000
At the beginning of the year/period 78 4 1
Foreign exchange differences on translation of foreign operations recognised (42) 74 3
in OCI
At the end of the year/period 36 78 4
AQUIS EXCHANGE PLC
NOTES TO THE FINANCIAL STATEMENTS (continued)
18. IFRS 16 Leases
The impact on the Groups assets and liabilities, and the related effects on
profit and loss, of the Groups leasing activities
(the Group as a lessee) are detailed below.
Right of Use Asset
Property
£'000
Carrying amount at 1 January 2021 1,098
Depreciation for the period (87)
Carrying amount at 30 June 2021 1,011
Depreciation for the period (67)
Additions 3,758
Disposals (964)
Carrying amount at 31 December 2021 3,738
Depreciation for the period (173)
Carrying amount at 30 June 2022 3,565
Of which are:
Current 341
Non-current 3,224
3,565
Rent deposit asset
Rent deposit asset
£'000
Carrying amount at 1 January 2021 229
Finance income on rent deposit asset for the period 3
Carrying amount at 30 June 2021 232
Finance income on rent deposit asset for the period 6
Additions 374
Carrying amount at 31 December 2021 612
Finance income on rent deposit asset for the period 22
Carrying amount at 30 June 2022 634
Of which are:
Current 284
Non-current 350
634
AQUIS EXCHANGE PLC
NOTES TO THE FINANCIAL STATEMENTS (continued)
Lease liability
Lease liability
£'000
Carrying amount at 1 January 2021 1,190
Finance expense on lease liability for the period 18
Lease payments made during the period (116)
Carrying amount at 30 June 2021 1,092
Finance expense on lease liability for the period 17
Lease payments made during the period (114)
Reduction in assumed lease liability (926)
Additions 3,563
Carrying amount at 31 December 2021 3,631
Finance expense on lease liability for the period 57
Lease payments made during the period (39)
Carrying amount at 30 June 2022 3,649
Of which are:
Current 435
Non-current 3,214
Net finance expense on leases
6months ended 30/06/2022 Year ended 31/12/2021 6 months ended 30/06/2021
£'000 £'000 £'000
Finance expense on lease liability 57 35 18
Finance income on rent deposit asset (22) (9) (3)
Net finance expense relating to leases 35 26 15
The finance income and finance expense arising from the Groups leasing
activities as a lessee have been shown net where applicable
as is permitted by IAS 32 where criteria for offsetting have been met.
Amounts recognised in profit and loss
6 months ended 30/06/2022 Year ended 31/12/2021 6 months ended 30/06/2021
£'000 £'000 £'000
Depreciation expense on right-of-use assets (173) (149) (87)
Finance expense on lease liability (57) (35) (18)
Finance income on rent deposit asset 22 9 3
Net impact of leases on profit or loss (208) (175) (102)
Net finance expense on leases
6 months ended 30/06/2022 Year ended 31/12/2021 6 months ended 30/06/2021
£'000 £'000 £'000
Finance expense on lease liability 57 35 18
Finance income on rent deposit asset (22) (9) (3)
Net finance expense relating to leases 35 26 15
The finance income and finance expense arising from the Groups leasing
activities as a lessee have been shown net where applicable
as is permitted by IAS 32 where criteria for offsetting have been met.
Amounts recognised in profit and loss
6 months ended 30/06/2022 Year ended 31/12/2021 6 months ended 30/06/2021
£'000 £'000 £'000
Depreciation expense on right-of-use assets (173) (149) (87)
Finance expense on lease liability (57) (35) (18)
Finance income on rent deposit asset 22 9 3
Net impact of leases on profit or loss (208) (175) (102)
AQUIS EXCHANGE PLC
NOTES TO THE FINANCIAL STATEMENTS (continued)
The total cash outflow for leases amounted to £39k in the 6 months to 30(th)
June 2022.
19. Cash generated from operations
6 months ended 30/06/2022 Year ended 31/12/2021 6 months ended 30/06/2021
£'000 £'000 £'000
Profit after tax 699 4,311 1,008
Adjustments for:
Deferred tax - (1,089) -
Investment revenue (4) - -
Amortisation and impairment of intangible assets 264 506 278
Depreciation of property, plant and equipment 369 519 254
Equity settled share-based payment expense 289 572 294
Other (gains)/losses (26) 325 39
Movement in working capital:
Increase in trade and other receivables (986) (2,750) (674)
Increase in trade and other payables 461 764 16
Cash generated/ (absorbed) by operations 1,066 3,158 1,215
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