REG - Aquis Exchange PLC - Results for the year ended 31 December 2024
14/04/2025 07:00
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RNS Number : 8608E Aquis Exchange PLC 14 April 2025
14 April 2025
Aquis Exchange PLC
("Aquis", the "Company" or the "Group")
Results for the year ended 31 December 2024
Aquis, the creator and facilitator of next generation financial markets, is
pleased to announce its audited results for the year ended 31 December 2024.
Financial highlights:
FY24 (£m) FY23 (£m)
Gross revenue 23.8 23.7
Net revenue 20.1 22.7
Adjusted profit before tax* 1.1 5.2
(Loss) / profit before tax (2.2) 5.2
Basic (Loss) / Earnings per share (p) (9)p 19p
Cash and cash equivalents 13.7 14.8
*Alternative performance measures have been used to ensure comparability of
financial information between reporting periods. Costs related to the
Recommended Offer (defined below) have been treated as exceptional items as
they are neither related to the ongoing activities of the Group, nor are they
repeatable expenditures.
Business highlights:
- Aquis continued to execute its ambitious long-term strategy,
achieving key milestones in all divisions, despite continuing macroeconomic
challenges.
- Aquis Markets launched conditional orders early in 2024, with
subsequent fast growth in use of the product helping to increase market share
to 5.22% (HY24: 5.20%).
- Aquis Technologies saw continued interest from a diverse mix of
prospective clients in the division's pioneering exchange technology, with one
new contract signed and strong growth in the division's contract pipeline to
stand at record levels.
- Aquis Data saw further strong growth in market data revenues,
following a full year of member data fees and the onboarding of five new
clients.
- Aquis Stock Exchange delivered positive growth in trading volumes
along with the highest levels of secondary fundraising since acquisition,
despite the continuing UK-wide depressed levels of primary listings.
Recommended Cash Offer for Aquis by SIX Exchange Group AG
On 11 November 2024, the boards of SIX Exchange Group AG ("SIX") and Aquis
were pleased to announce that they had reached agreement on the terms of a
recommended cash offer to be made by SIX for the entire issued and to be
issued ordinary share capital of Aquis (the "Recommended Offer"), to be
implemented by way of a court-sanctioned scheme of arrangement under Part 26
of the Companies Act 2006 (the "Scheme").
As previously announced, the requisite majorities of Aquis shareholders voted
in favour of the Scheme and approved all shareholder resolutions relating to
the Recommended Offer at a Court Meeting and General Meeting held on 20
December 2024.
The Scheme remains subject to the satisfaction (or waiver, where applicable)
of certain conditions, including the receipt of certain regulatory approvals
and subsequent sanction of the Scheme by the High Court of Justice; full
details of the conditions can be found in Part III of the Scheme Document.
Presently, Aquis has obtained all of the approvals required to satisfy the
antitrust conditions. The remaining conditions, which relate to regulatory
approvals, are expected to be satisfied in Q2 2025, and the Scheme remains
expected to become effective in Q2 2025 and, in any event, prior to 11
November 2025.
David Stevens, CEO, Aquis Exchange PLC, said:
"2024 was a year of strategic progress for Aquis across the Group, with a
slight increase in gross revenue despite continued economic headwinds
throughout the year.
"The Group benefits from the diversified product offerings of its four
divisions, with growth in the Markets and Data divisions offsetting a flat
year for the Aquis Stock Exchange and a decline in revenues for the
Technologies division following a strong 2023.
"I am proud of the achievements of our team across market share, technology
innovations, new contracts and strengthening of the primary market. The
Recommended Offer represents an exciting next step in Aquis' journey and an
opportunity to accelerate our development. I remain confident in Aquis'
ability to create and facilitate better markets for a modern economy."
Enquiries:
Aquis Exchange PLC Tel: +44 (0)20 3597 6329
David Stevens, CEO investorrelations@aquis.eu
Richard Fisher, CFO and COO
Adele Gilbert, Chief Communications Officer
Investec Bank plc (Nominated Adviser and Broker) Tel: +44 (0)20 7597 5970
David Anderson
St John Hunter
Canaccord Genuity Limited (Joint Broker) Tel: +44 (0) 20 7523 8000
Emma Gabriel
George Grainger
VSA Capital Limited (AQSE Corporate Adviser) Tel: +44 (0 )20 3005 5000
Andrew Raca
MHP Group (Financial PR Adviser) Tel: +44 (0) 20 3128 8000
Eleni Menikou Aquis@mhpgroup.com
Finn Taylor
About Aquis Exchange PLC
Aquis Exchange PLC ("Aquis") is Europe's challenger exchange, creating better
markets for a modern economy. Aquis has market-leading technology and
innovative rules for trading, and offer primary listings and secondary trading
of equities, along with global licensing of proprietary technology.
Aquis consists of four divisions:
Aquis Markets operates lit and dark order books, covering 16 European markets.
For its lit books, Aquis 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.
Aquis Technologies is the software and technology division of Aquis. It
focuses on building better markets via the creation and licensing of
cutting-edge, cost-effective exchange infrastructure technology and services,
including matching engine and trade surveillance solutions.
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'; the
Access market focuses on earlier stage growth companies, while Apex is the
intended market for larger, more established businesses.
Aquis Data generates revenue from the sale of data derived from Aquis Markets
and Aquis Stock Exchange to market participants.
Aquis is authorised and regulated by the UK Financial Conduct Authority and
France's Autorité de contrôle prudentiel et de résolution and L'Autorité
des marchés financiers to operate Multilateral Trading Facility businesses in
the UK & Switzerland markets and in EU27 markets respectively. Aquis
Exchange PLC is quoted on the Aquis Stock Exchange and on the AIM Market (AIM)
of the LSE. For more information, please go to www.aquis.eu.
Chair's Statement
It was with great pleasure that I assumed the role of Chair of Aquis Exchange
PLC (AQXE) in 2024, and I am pleased to be reporting a year of strategic
progress.
Thank you to my predecessor, Glenn Collinson, for his prior leadership of the
Board.
During 2024, Aquis benefited from the diversified nature of its businesses,
with key milestones reached across all divisions and significant progress made
towards strategic objectives, despite the continued challenges of the economic
and markets backdrop. Overall, gross revenue remained flat at £23.8m, with
net revenues decreasing due to increased credit provisions against two
technology contracts as well as the non-renewal of a contract with a start-up
exchange, as previously communicated.
Overview
2024 was an important year for Aquis, as we continued to facilitate and
operate better markets for a modern economy in the UK and across Europe. The
Group continued to make progress, underpinned by strategic development in each
of our four business activities: Markets, Technology, Data and the Aquis Stock
Exchange. The strategic progress of the business is particularly noteworthy
given the difficult conditions which the economic and markets environments
have faced since 2021, which showed little improvement over the period.
Gross revenue for the year was broadly flat with a 0.3% increase on 2023 to
£23.8m and adjusted profit before tax falling to £1.1m. Building on 2023
performance, strategic milestones were met across all divisions and revenue
was particularly strong in Aquis Markets, with increasing contributions from
the Aquis dark pool (AMP) and the new conditional order type, as well as
increased revenue from market data following a full year of charging members.
We continued to develop our presence in Europe and enhance client
relationships within the EU 27 markets.
Board and Governance
Jonathan Clelland retired from the Board in April 2024, as planned and
previously announced in the 2023 report. Glenn Collinson stepped down from the
Board for personal reasons in November 2024, at which point I was appointed to
the position of Chair. Following this change, I stepped down from the Audit,
Risk & Compliance Committee and Ruth Wandhöfer joined the Nominations and
Remuneration Committee.
In February 2025, Chief Executive Alasdair Haynes made the decision to step
away from full-time running of the business due to health reasons. I would
like to take this opportunity to thank Alasdair for the enthusiasm and vision
with which he founded Aquis and led the company for 13 years, and I am
delighted to have Alasdair remaining with Aquis as the Group President and on
the Board as a Non-Executive Director. The Board was pleased to appoint David
Stevens, the Group's prior Chief Operating Officer (COO), into the CEO role
and to see the positive reception by the broader business. In addition to his
role as Chief Financial Officer, Richard Fisher has assumed the role of COO.
We believe the Board is scaled appropriately to meet the opportunities ahead,
however, we will continue to monitor closely the skills and experience of the
Board to ensure that we are able to steer the business to continue to deliver
on all aspects of its strategy.
Culture, Stakeholder Engagement and Section 172 Duties
The Board continued its engagement with key stakeholders, particularly
focusing on employees and shareholders.
Executive management meet with the key shareholders at appropriate times
during the year and provide feedback to the Board, and I, and previously Glenn
Collinson, and the Chair of the Nomination & Remuneration Committee
continued, where possible, to engage with shareholders through one-on-one
meetings. Shareholders have been appreciative of these meetings and feedback
is provided to the Board in both written and verbal updates.
The Group promotes a positive and inclusive culture. Team meetings and Group
briefings are held on a regular basis to ensure all personnel are informed of
the Group's performance and key strategic objectives and goals. Staff are
encouraged to contribute to a monthly employee engagement pulse survey, which
allows employees to provide feedback in confidence, the results of which were
consistently positive during the year. The Executive team develops an action
plan to address the key areas highlighted with particular emphasis on our core
values, listed later in this report, and on investing further in employee
training and career development.
Environment, Social and Corporate Responsibility
From the outset, Aquis has been committed to improving the efficiency of
markets through transparency and innovation. In addition, we aim to stimulate
growth in the economy by listening to the needs of issuers and creating a
supportive, fair and low-cost environment for capital raisers to list
instruments, particularly for innovative young companies. These initiatives
have wide corporate and social benefits in addition to helping to build Aquis'
business.
We continue to make progress on our ESG plans by measuring our carbon
footprint and have set a target to reduce our environmental impact. In
addition, we continued our financial literacy community project and increased
our staff engagement efforts, reflecting the continued growth of the
organisation. Details of these initiatives and workplace culture award
recognition are set out in the Strategic Report.
Our Board in 2025 comprises three women and five men. We will continue to
build the best teams at Aquis irrespective of peoples' gender, religion,
ethnicity or any other factor that is not relevant to the job in hand. We use
the Gender Pay Gap measure as an objective way of measuring the level of
female seniority in the company. We remain committed to further improving the
measure of female seniority; in 2024 this was 16% on base salary and 19% on
base salary plus annual bonus, an improvement on 20% and 23% respectively last
year. Our target remains to be materially better than the average in UK
financial services (25.1%) on this measure.
The Recommended Offer
On 11 November 2024, we were pleased to announce that Aquis had reached
agreement with SIX Exchange Group AG ("SIX") on the terms of a recommended
cash offer to be made by SIX to acquire the whole of the issued and to be
issued share capital of Aquis (the "Recommended Offer"), to be implemented by
way of a court-sanctioned scheme of arrangement under Part 26 of the Companies
Act 2006 (the "Scheme").
The requisite majorities of Aquis shareholders voted in favour of the Scheme
and approved all shareholder resolutions relating to the Recommended Offer at
a Court Meeting and General Meeting held on 20 December 2024.
The Scheme remains subject to the satisfaction (or waiver, where applicable)
of certain conditions, including the receipt of certain regulatory approvals
and subsequent sanction of the Scheme by the High Court of Justice; full
details of the conditions can be found in Part III of the Scheme Document.
Presently, Aquis has obtained all of the approvals required to satisfy the
antitrust conditions. The remaining conditions, which relate to regulatory
approvals, are expected to be satisfied in Q2 2025, and the Scheme remains
expected to become effective in Q2 2025 and, in any event, prior to 11
November 2025.
Following satisfaction of the outstanding regulatory conditions, an updated
timeline with expected principal dates will be notified to shareholders by
announcement through the Regulatory Information Service.
The Scheme Document can be viewed at
www.aquis.eu/investors/offer-documentation.
Our focus for the year ahead
We are confident that we have the resources and technology to support further
growth across all our business activities and we will continue to invest in
order to maintain this trajectory.
Deirdre Somers
Chair
Chief Executive's Report
Overview
2024 was a year of strategic progress for Aquis with gross revenues of
£23.8m, a 0.3% increase on 2023.
This was achieved despite continuing economic headwinds throughout the year,
and factors like political change (both in the UK and abroad), interest and
inflation rates impacting on market conditions and primary market issuances.
Adjusted profit before tax decreased by £4.1m to £1.1m due to the previously
announced increased credit provisions against two technology contracts as well
as the non-renewal of a contract with a start-up exchange.
However, the Group benefited from the diversified product offerings of its
four divisions, with growth in the Markets and Data divisions offsetting a
flat year for the Aquis Stock Exchange and a decline in revenues for the
Technologies division following a strong 2023 and the adjustment in ECL
provisions. All four divisions made significant progress against the strategy
over the period, and I am pleased with the trajectory of each and continued
strength of our principal business activities.
The Group's balance sheet remains strong and the business is well-capitalised
for future opportunities.
Aquis Markets
Over the period, the secondary market multilateral trading facility ("MTF")
platforms operated by the Group in London and Paris continued to grow despite
challenging economic and regulatory conditions, underpinning the resilience of
the subscription model. Divisional revenue increased to £11.8m, up 7.8%.
Aquis had a 5.11% share of total trading on exchange in 2024, and ended
December with a market share of 5.22%: a 0.25% increase year-on-year.
In early 2024, we launched conditional orders and subsequently saw significant
growth in this product over the course of the year. It now has 10 users and
set an all time record average daily value in November 2024 of €72m.
Throughout the year, we made enhancements to the existing Auction on Demand
product and continued to see high trading volumes in the Market at Close
('MaC'), with a new record MaC ADV of €769m set in June 2024.
An increase to the MTF stock universe now allows clients to trade more than
6,500 stocks and ETFs across 16 European markets, and members are also now
able to use OptimX blotter scraping functionality.
Aquis Technologies
Aquis Technologies, where Aquis licenses its leading exchange related
technology to a variety of international financial services clients across
different asset classes, saw a decline in net revenue over the period by 74.9%
(to £1.6m) following a strong 2023, due to increased credit provisions
against two technology contracts as well as the non-renewal of a contract with
a start-up exchange. In accordance with Aquis' accounting policies, management
increased its ECL provisions in respect of two existing technology clients,
reflecting a heightened credit risk.
Aquis remains focused on diversifying its technology client mix and there was
strong growth in the division's contract pipeline over the period - increasing
materially to stand at record levels. The division's client profile continues
to strengthen, with more than half of the prospects being national exchanges
or central banks. The division signed one new contract during the period,
renewed one contract and saw one non-renewal of an existing contract.
The profile and awareness of Aquis Technologies also continues to rise, and
the division was awarded Best Matching Engine for Exchanges and Electronic
Trading Venues at the 2024 TradingTech Insight Awards (both Europe and US).
Post-period end, Aquis Technologies was pleased to reach the 'design study'
stage for a national exchange group, for which it has been participating in an
RFP process for provision of exchange technology across multiple markets since
early 2024. This stage of the RFP process is exploratory, and involves such
activities as identifying scope of work, exploring and testing hardware
requirements, IT system integration architecture and software capability.
Aquis Data
Data revenues increased by 33.3% to reach £5.0m (2023: £3.7m), reflecting a
full year of charging member data fees along with the addition of five new
customers. The Group continues to benefit from increased recognition of the
quality and competitive price of Aquis market data, and we expect that it will
continue to make a significant contribution.
In addition to the contribution data brings to the Group results, management
believe in the medium-term it will increase further in importance when
consolidated tapes for the UK and Europe are implemented.
Implementation timetables from 2026 have been announced and it is widely
recognised and accepted that introducing consolidated tapes for equities
should improve the quality and pricing of market data and lead to a fairer
distribution of data fees across the various European trading venues.
Aquis Stock Exchange (AQSE)
The IPO market remained subdued over the period, with low admission numbers on
all UK markets. However, we are pleased to have welcomed three new issuers to
the Aquis Stock Exchange in 2024, and to see five issuers graduating from
Access to Apex after achieving the requisite size and corporate governance
requirements.
Many of the improvements we have made over the past three years to aid access
and liquidity on the exchange are beginning to bear fruit. £118m was raised
by issuers over the year (an increase of 27% on the £93m raised in 2023, with
22 fundraises exceeding £1m and a 39% increase in the total value of further
issues - a record year for AQSE since acquisition.
There was also an improvement in trading, with a 21% increase in the value of
trading to over £177m.
We continue to be enthused by the opportunity to build a pan-European,
technology-driven listing exchange for growth companies and believe we will be
well positioned when market conditions start to improve.
Further Investment in Research and Development (R&D)
The Group continued to invest in R&D throughout 2024 in order to maintain
and enhance the quality of our technology and its ability to deliver new
products and platform enhancements to our clients.
Our proven trading platform has been developed in-house and is based on
proprietary technology, which does not rely on third party software suppliers.
I believe this commitment to continued investment in R&D gives us a
significant competitive advantage on functionality, price and ability to
deliver. The organisation of Aquis' technology department ensures expeditious
product development and, together with Aquis' further investment, will allow
the Group to react quickly to dynamic market conditions. We intend to continue
to work on further developments which will foster future growth.
Resources
During 2024, we continued to invest in personnel resources across a number of
departments with headcount across the London and Paris offices increasing by
19% to 88 (FY23: 74). We intend to further strengthen our team, particularly
in support of technology development and infrastructure.
The Recommended Offer
On 11 November 2024, the boards of SIX and Aquis were pleased to announce that
they had reached agreement on the terms of the Recommended Offer. The Aquis
Directors have concluded that the terms of the Recommended Offer provide Aquis
shareholders with an attractive opportunity to accelerate and de-risk future
value creation, and thus, the Aquis Directors recommended unanimously in
favour of the Scheme.
The Scheme, and resolutions related to the Recommended Offer, were approved by
the requisite majorities of Aquis shareholders at the Court Meeting and
General Meeting held on 20 December 2024.
The Scheme remains subject to the satisfaction (or waiver, where applicable)
of certain conditions, including the receipt of certain regulatory approvals
and subsequent sanction of the Scheme by the High Court of Justice; full
details of the conditions can be found in Part III of the Scheme Document.
Presently, Aquis has obtained all of the approvals required to satisfy the
antitrust conditions. The remaining conditions, which relate to regulatory
approvals, are expected to be satisfied in Q2 2025, and the Scheme remains
expected to become effective in Q2 2025 and, in any event, prior to 11
November 2025.
Outlook
2024 was an important year for Aquis, and despite difficult conditions I am
proud of the achievements of our team across market share, technology
innovations, new contracts and strengthening of the primary market.
We remain confident in Aquis' unique proposition and our ability to create and
facilitate better markets for a modern economy. We will also continue to
promote the Aquis values of transparency, fairness and simplicity, enabling
our end customers to get better performance and results.
Our principal aim in the near future is to deliver the completion of the
Recommended Offer.
Our highly capable and experienced management team remains focused on serving
our clients as we capitalize on the opportunities ahead.
David Stevens
Chief Executive Officer
Financial Review
2024 saw broadly flat gross revenues, with the company benefitting from the
diversified product offerings between divisions. The breakdown of revenues is
as follows:
2024 2023 YoY Growth
£ £ %
Revenue analysed by division
Markets 11,775,892 10,919,263 7.8%
Technology 5,264,639 7,298,157 -27.9%
Stock Exchange 1,768,077 1,771,284 -0.2%
Market Data 4,963,407 3,722,237 33.3%
23,772,015 23,710,941 0.3%
The Group generated an Adjusted Profit Before Tax of £1.1m compared to £5.2m
in the previous year.
A reduction in Adjusted PBT is explained by increases in Expected Credit Loss
provisions against Contract Assets and Trade Receivables balances by £3.7m
and £0.6m, respectively. Of these amounts, £3.0m of Contract Asset and
£0.6m of Trade Receivable impairments reflected a heightened risk of default
for two existing technology customers.
Adjusted Profit Before Tax excludes exceptional costs of £3.3m incurred for
the Recommended Offer, and have been included in the Loss Before Tax of
(£2.2m) (2023: Profit of £5.2m).
The Loss Before Tax includes amortisation charges to internally generated
intangible assets, as well as depreciation and finance charges, which reflect
the accounting treatment of leases under IFRS 16 and other tangible fixed
assets. The total depreciation and amortisation cost to the Group increased by
£0.3m to £1.7m (2023: £1.4m) because of continuing investment in the
Group's technological capabilities.
The Group generated an income tax charge of £235k (2023: credit of £8k)
which was a result of taxable profits provided in the foreign subsidiary.
There was no change in the amount of net deferred tax asset (2023: increase of
£191k).
Net assets of the Group as at 31 December 2024 were £25.8m (31 December 2023:
£28.4m), largely reflecting cash out flows for exceptional costs and an
increase in ECL provisions against Contract Assets and Trade Receivables.
Revenue from licensing technology contracts is subject to a provision under
IFRS 9 for Expected Credit Losses. For 2024 the application of IFRS 9 resulted
in a net impairment provision charge of £3.7m (2023: £1.0m) recognised in
the Income Statement, including an increase in provisions against two existing
customers for £3.0m.
Trade receivables balances contained provisions of £0.8m in the year, of
which £0.7m related to balances outstanding by the same two technology
customers, for which a charge of £0.6m was recognised in the year.
Balance sheet liabilities included provisions of £0.3m recognised in 2024 for
disputes with two data vendors over historical fees.
The lease liabilities arising from the Group's office leases are paid over the
lease term, and attract a finance expense amounting to £84k for 2024. The
associated right of use assets are depreciated on a straight-line basis over
the life of the lease, and attract a depreciation charge of £383k for 2024.
The Group's cash and cash equivalents as at 31 December 2024 decreased to
£13.7m (2023: £14.8m), including payment of exceptional costs amounting to
£3.0m. The continued growth (when exceptional costs are excluded)
demonstrates the robust cash generation of continuing business activities in
the Group. Over the year the Group purchased £1.5m of treasury shares used to
service employee share schemes.
Regulatory capital
The Group is required to maintain sufficient capital to meet the regulatory
obligations for all entities. These are calculated and updated annually. At 31
December 2024, the Company ICARA requirement (based on the 2023 published
financial Annual Report and Accounts) amounted to £6.2m (2023 £5.2m) and
AQSE's FRR amounted to £2.5m (2023 £2.1m). The individual entities of the
Group meet the respective FCA and ACPR capital adequacy requirements with
plenty of headroom for further investment in business operations.
Future development of the business
In order to support its long-term vision and in order to strategically
position for continued growth, Aquis has invested significantly in its
business differentiators, R&D in the technology platform, brand and
personnel resources. The Group is cognisant of the importance of such
investments to maintain innovation and strong quality delivery and the Board
considers that its investments have contributed to the Group's ability to gain
new clients, broaden its customer base and increase revenue.
The Group recognises the importance of continuing to enhance productivity, and
the commitment to future investment, both technically and in terms of resource
training and development. The Group has established both short and long-term
incentive plans based on performance for all employees, which are set out in
more detail in the Report of the Nomination and Remuneration Committee and
aligns the employees' interests with the long-term strategic objectives of the
Group.
Aquis Stock Exchange
During 2024, the Group has continued to invest in AQSE, building market
presence and brand whilst also benefitting from synergies across the Group's
exchange memberships, data offering and use of technology.
Alternative Performance Measures (APMs)
This report contains certain financial measures (APMs) that are not defined or
recognised under IFRS but have been presented to provide readers with a
complete set of financial information which would allow a user of this Annual
Report and Accounts to better understand and compare the financial performance
of the Group.
Net Revenue
Net Revenue is the revenue that is generated and offset against the Expected
Credit Loss (ECL) movement of contract asset balances (note that this does not
include the ECL movement on trade receivable balances).
Each contract asset balance is assessed against the expected ability of a
customer to satisfy open balances in future periods. On inception of new
Technology licences a contract asset is recognised, alongside a day-1 ECL
provision. In this scenario, the Net Revenue from this customer would be the
Licence Fee (see Note 10 for details of performance obligations for technology
contracts) offset against ECL provision (see Note 11 for impairment analysis).
For extant technology contracts, as the contract asset balance is reduced by
cash receipts from the customer, the associated ECL provision is reduced; in
this scenario the release of the ECL balance is shown as Net Revenue.
The excerpt below demonstrates the effect of Net Revenues from Aquis
Technologies (see Note 6for a full analysis of segment performance).
Group and Company
2024 2023
£ £
Revenue from technology customers 5,264,639 7,298,157
Net ECL Charge (3,685,326) (1,016,223)
Net Revenue 1,579,313 6,281,934
Adjusted EBITDA (before exceptionals) and Adjusted Profit Before Tax
Adjusted EBITDA is the earnings before interest, taxation, depreciation, and
amortisation excluding material non-recurring "Recommended Offer" costs.
Similarly, Adjusted Profit Before Tax is the profit before tax excluding
material non-recurring Offer costs.
The Directors use these metrics to assess Group performance to show the
underlying economic performance year-on-year. Offer costs are treated as
exceptional items as they are neither related to the ongoing activities of the
Group, nor are they repeatable expenditures.
Recommended Offer costs include staff costs, in addition to the various legal
and professional fees paid for the necessary professional services. In 2024,
the Adjusted EBITDA of the Group was £2.2m (2023: £6.3m) and the Adjusted
PBT was £1.1m (2023: £5.2m).
The following reconciliation demonstrates the impact of excluding Exceptional
Recommended Offer costs from Adjusted EBITDA and Adjusted PBT.
Adjusted EBITDA Group
2024 2023
£ £
EBITDA (1,182,818) 6,270,252
Add back Exceptional Recommended Offer costs 3,343,863 -
Adjusted EBITDA 2,161,045 6,270,252
Adjusted PBT Group
2024 2023
£ £
Loss before tax (2,226,649) 5,194,887
Add back Exceptional Recommended Offer costs 3,343,863 -
Adjusted profit before tax 1,117,214 5,194,887
Consolidated statement of comprehensive income
For the year ended 31 December 2024
Group Company
2024 2023 2024 2023
Notes £ £ £ £
Profit and loss
Revenue 10 23,772,015 23,710,941 11,680,818 13,147,339
Impairment charge on contract assets 11 (3,685,326) (1,016,223) (3,685,326) (1,016,223)
Impairment charge on trade and other receivables 11 (702,437) (79,395) (601,598) (59,608)
Other (losses) / gains 12 (138,437) 51,407 (138,437) 51,407
Operating expenses 12 (17,084,770) (16,396,478) (6,022,669) (6,874,123)
Exceptional Recommended Offer costs 13 (3,343,863) - (3,319,520) -
Earnings before interest, taxation, depreciation and amortisation (1,182,818) 6,270,252 (2,086,732) 5,248,792
Depreciation and amortisation 12 (1,660,998) (1,372,565) (1,590,993) (1,299,276)
Finance expense 12, 28 (84,256) (103,249) (71,705) (88,571)
Finance income 12 701,423 400,449 300,861 127,447
(Loss) / profit before taxation (2,226,649) 5,194,887 (3,448,569) 3,988,392
Income tax (charge)/credit 16 (235,291) 7,789 - 49,837
(Loss) / profit for the year (2,461,940) 5,202,676 (3,448,569) 4,038,229
Other comprehensive income
Items that may be subsequently reclassified to profit or loss:
Foreign exchange differences on translation of foreign operations (212,740) (120,961) - -
Other comprehensive income for the year (212,740) (120,961) - -
Total comprehensive (loss) / income for the year (2,674,680) 5,081,715 (3,448,569) 4,038,229
Earnings per share (pence) Basic
Ordinary shares 17 (9) 19 (13) 15
Diluted
Ordinary shares 17 (9) 19 (12) 14
Consolidated statement of financial position
As at 31 December 2024
Group Company
2024 2023 2024 2023
Notes £ £ £ £
Non-current assets
Goodwill 18 83,481 83,481 - -
Intangible assets 18 2,417,524 1,501,885 2,417,524 1,501,885
Property, plant and equipment 19 3,290,675 3,818,841 2,892,632 3,350,793
Investment in subsidiaries 20 - - 6,884,202 6,884,202
Investments 21 1,176,021 591,945 1,176,021 591,945
Investment in trusts 22 - - 5,702,768 4,389,445
Deferred tax asset 15 1,785,331 1,785,331 1,506,022 1,506,022
Trade and other receivables 23 3,169,367 5,811,089 3,158,605 5,795,918
11,922,399 13,592,572 23,737,774 24,020,210
Current assets
Trade and other receivables 23 7,653,949 6,894,936 8,422,762 6,736,943
Derivative financial instruments 5 - 51,407 - 51,407
Cash and cash equivalents 25 13,699,076 14,765,910 5,745,324 6,356,259
Total assets 33,275,424 35,304,825 37,905,860 37,164,819
Current liabilities
Provisions 26 343,784 - 343,784 -
Derivative financial instruments 5 3,219 - 3,219 -
Trade and other payables 27 5,083,208 4,471,470 6,454,845 3,665,932
Net current assets 15,922,814 17,240,783 7,366,238 9,478,677
Non-current liabilities
Lease liabilities 28 2,037,577 2,457,105 1,734,788 2,100,483
2,037,577 2,457,105 1,734,788 2,100,483
Total liabilities 7,467,788 6,928,575 8,536,636 5,766,415
Net total assets 25,807,636 28,376,250 29,369,224 31,398,404
Equity
Called up share capital 29 2,760,253 2,751,678 2,760,253 2,751,678
Share premium account 33 12,098,734 11,809,757 12,098,734 11,809,757
Other reserves 34 3,863,426 2,741,589 3,863,426 2,741,589
Treasury Shares 30 (5,702,768) (4,389,445) - -
Retained earnings 13,057,567 15,519,507 10,646,811 14,095,380
Foreign currency translation reserve (269,576) (56,836) - -
Total equity 25,807,636 28,376,250 29,369,224 31,398,404
David Stevens Richard Fisher
CEO CFO
Statement of changes in equity
For the year ended 31 December 2024
Group Notes Share Capital Share Premium Share Based Payment Reserve Retained Earnings Treasury Shares Foreign Currency Translation Total
Reserve
Balance at 1 January 2023 2,750,945 11,785,045 1,813,119 10,316,831 (3,350,325) 64,125 23,379,740
Profit for the year - - - 5,202,676 - 5,202,676
Foreign exchange differences on translation of foreign operations - - - - - (120,961) (120,961)
Total comprehensive income for the year - - - 5,202,676 - (120,961) 5,081,715
Issue of new shares 29, 33 733 24,712 - - - - 25,445
Movement in share based payment reserve 34 - - 928,470 - - - 928,470
Movement in treasury shares 30 - - - - (1,039,120) - (1,039,120)
Balance at 31 December 2023 2,751,678 11,809,757 2,741,589 15,519,507 (4,389,445) (56,836) 28,376,250
Balance at 1 January 2024 2,751,678 11,809,757 2,741,589 15,519,507 (4,389,445) (56,836) 28,376,250
Loss for the year - - - (2,461,940) - - (2,461,940)
Foreign exchange differences on translation of foreign operations - - - - - (212,740) (212,740)
Total comprehensive loss for the year - - - (2,461,940) - (212,740) (2,674,680)
Issue of new shares 29, 33 8,575 288,977 - - - - 297,552
Movement in share based payment reserve 34 - - 1,121,837 - - - 1,121,837
Movement in treasury shares 30 - - - - (1,313,323) - (1,313,323)
Balance at 31 December 2024 2,760,253 12,098,734 3,863,426 13,057,567 (5,702,768) (269,576) 25,807,636
For the year ended 31 December 2024
Company Notes Share capital Share premium Share Based Retained Earnings Total
Payment Reserve
Balance at 1 January 2023 2,750,945 11,785,045 1,813,119 10,057,151 26,406,260
Profit and total comprehensive income for the year - - - 4,038,229 4,038,229
Issue of new shares 29,33 733 24,712 - - 25,445
Movement in share based payment reserve 34 - - 928,470 - 928,470
Balance at 31 December 2023 2,751,678 11,809,757 2,741,589 14,095,380 31,398,404
Balance at 1 January 2024 2,751,678 11,809,757 2,741,589 14,095,380 31,398,404
Loss and total comprehensive loss for the year - - - (3,448,569) (3,448,569)
Issue of new shares 29, 33 8,575 288,977 - - 297,552
Movement in share based payment reserve 34 - - 1,121,837 - 1,121,837
Balance at 31 December 2024 2,760,253 12,098,734 3,863,426 10,646,811 29,369,224
Statement of cash flows
For the year ended 31 December 2024
Group Company
2024 2023 2024 2023
Notes £ £ £ £
Net cash flows from operating activities 31 2,525,063 4,103,719 3,133,650 4,340,136
Investing activities
Recognition of intangible assets 18 (1,744,353) (1,081,918) (1,744,353) (1,081,918)
Purchase of property, plant and equipment 19 (387,929) (411,316) (387,929) (409,731)
Recovery of deposit on leases 28 442,254 - 437,400 -
Investment acquisitions 21 (584,076) (591,945) (584,076) (591,945)
Interest received 651,009 384,712 208,701 112,154
Loans made to EBTs - - (1,534,480) (1,196,309)
Net cash used in investing activities (1,623,095) (1,700,467) (3,604,737) (3,167,749)
Financing activities
Issue of new shares 29, 33 297,552 25,445 297,552 25,445
Principal portion of lease liability 5, 28 (519,134) (516,482) (437,400) (437,400)
Purchase of treasury shares (1,534,480) (1,196,309) - -
Net cash used in financing activities (1,756,062) (1,687,346) (139,848) (411,955)
Net (decrease)/increase in cash and cash equivalents (854,094) 715,906 (610,935) 760,432
Cash and cash equivalents at the beginning of the year 14,765,910 14,170,965 6,356,259 5,595,827
Effect of exchange rate changes on cash and cash equivalents (212,740) (120,961) - -
Cash and cash equivalents at the end of the year 13,699,076 14,765,910 5,745,324 6,356,259
Notes to the Financial Statements
1. Significant Changes in The Reporting Period
The following events and transactions had an impact on the financial position
and performance of the Group and/or Company during the period:
Following the Offer to acquire Aquis by SIX Group, the Group has incurred
material expenditure on the deal. These costs were presented as exceptional
items in the Financial Statements, resulting in the use of alternative
performance measures. Details of these costs have been outlined in Note 13.
2. Basis of preparation and accounting policies
Company information
Aquis Exchange PLC is a public limited company which is incorporated and
domiciled in the United Kingdom. Its registered office is located at 63 Queen
Victoria Street, London, EC4N 4UA. The Company Number is 07909192.
Accounting convention
The Group's consolidated and the Company's financial statements are prepared
in accordance with UK- adopted international accounting standards and the
Companies Act 2006 requirements.
The financial statements have been prepared on the historical cost basis as
modified by the revaluation of financial instruments carried at fair value
through profit and loss.
The principal accounting policies applied in the preparation of these
financial statements are set out below. These policies have been consistently
applied to all the years presented, unless otherwise stated.
Going concern
At the time of approving the financial statements, the Directors have a
reasonable expectation that the Group has adequate resources to continue in
operational existence for the foreseeable future and thus continue to adopt
the going concern basis of accounting in preparing the financial statements.
In the year there has been material expenditure on deal related costs, see
note 13, related to the offer to acquire Aquis by SIX Group. While the quantum
of these costs has been material they have been treated as exceptional because
they will not repeat in subsequent years. The underlying activities of the
group remain profitable in 2024. The Group, at and after the balance sheet
date, maintains sufficient liquidity to meet its regulatory commitments in the
UK and France. Therefore, the directors are confident there is no risk to the
going concern of the Group and Company.
Taking the above into account, the principal risks discussed in the Strategic
Report section of the Annual Report, the financial risks and mitigating
actions taken by management (see Note 5), and the Group's current financial
position, the Directors do not foresee any material uncertainty in the Group's
ability to continue as a going concern over a period of at least 12 months
from the date of approval of these financial statements and hence the
financial statements have been prepared on a going concern basis.
Consolidation
In preparing these financial statements, the group has applied the
consolidation principles in IFRS 10, Consolidated Financial Statements. This
requires the Group to consolidate subsidiary entities it controls. Control is
determined based on the ability to direct the activities of the entity that
significantly affect its returns.
The Group assesses control on a continuing basis and includes entities it
controls as of the end of the reporting period.
The financial statements of the consolidated entities are prepared using
consistent accounting policies and are presented as if they were a single
economic entity. Intercompany transactions, balances, and unrealised gains and
losses on transactions between consolidated entities are eliminated in full.
The Group consolidated financial statements also include treasury shares and
cash held by two separate trusts ("the Trusts") that administers the Company's
employee share incentive plan and also hold shares purchased by the Group in
preparation for future settlement of employee share awards made to date. The
Trusts have been consolidated based on the IFRS 10 criteria for control over
the Trust being met:
• The Trusts were established to (i) facilitate the acquisition and
holding of shares under the Aquis Exchange PLC Share Incentive Plan and (ii)
facilitate the acquisition and holding of shares under all other Aquis
Exchange share plans.
• The activities of the Trusts are limited by the agreements in place;
and
• The Trusts do not have any assets outside of the partnership share
money received and the shares purchased. The use of any shares or cash that
remain in the Trust funds once the trustee no longer holds any shares relating
to the SIP, RSP or PPO, is directed by the Company. The Trust itself has no
rights to any dividends.
Accounting Policies
Revenue
Revenue comprises amounts derived from the provision of services which fall
within the Company's ordinary activities. It represents amounts receivable for
subscription fees, the licensing of software, the provision of data to
third-party vendors, and fees relating to listings on the Aquis Stock Exchange
("AQSE"), all of which are net of value added tax. Revenue is recognised once
the performance obligations for each activity have been satisfied.
All the revenue streams are generated by contracts with customers and revenue
is therefore recognised in accordance with IFRS 15.
Revenue from exchange subscription-based services is recognised over time when
the services are rendered.
Revenue from licensing contracts is assessed for each contract and split into
five Performance Obligations (see Note 10 for further details on 'POs' and
Note 4 for Judgements and estimates):
• Project Implementation / Design fees (PO1) recognised over time as
the obligations are met;
• Licencing fees (PO2) recognised at a point in time when the licence
is transferred to the customer;
• Maintenance fees (PO3) recognised over time as the obligations are
met;
• Live services fees (PO4) recognised over time as the obligations are
met;
• Hosting fees (PO5) recognised over time as the obligations are met.
Revenue from the provision of data to third-party vendors is comprised of the
annual fees paid by the redistributors, member firms and multi-media firms for
access to real time and/or end of day data and is recognised over time. An
additional monthly fee is received based on the number of users the vendors
provide the data to each month. This additional monthly fee is variable and is
based on usage for the prior month. The fee is charged in arrears and is
recognised in the month it is incurred.
Revenue from AQSE issuer fees is comprised of initial application and
admission fees, annual fees, and further issue fees, these are all recognised
over time under IFRS 15 except further issue fees which are recognised at a
point in time.
Application and admission fees are charged upfront to prospective companies
admitted to AQSE markets. These are recognised monthly over the average
expected life of company admission periods (further details about this
estimate are set out in the following section).
Annual fees are paid upfront annually by companies with securities listed on
AQSE and are recognised over the year.
Further issue fees are incurred by existing issuers who have already
contributed an application and admission fee and are recognised at a point in
time on the date the new security is available for trade on AQSE.
Estimated listing period for Aquis Stock Exchange securities
In recognising application and admission fees, the Company determines the
expected length of time each new security will be listed on AQSE. The estimate
is based on historical analysis of listing durations in respect of the
companies listed on AQSE. The length of time a security remains listed
incorporates significant uncertainty as it is based on factors outside the
control of the Company and which are inherently difficult to predict.
Based on the available information and incorporating management's predictions,
it is currently estimated that an average security will remain listed for a
period of 9 years. Application and admission fees are recognised monthly over
a period of time.
It is estimated that a one year increase/ decrease in the deferral period
would cause an £10k decrease / £8k increase in annual revenue released
respectively. The estimated listing periods will be reassessed at each
reporting date to ensure they reflect the best estimates of the Group.
Intangible assets other than goodwill
Internally generated intangible assets
Internally developed intangible assets arising from the capitalisation of
Development expenditures, product analysis, quality assurance, and website
development costs are recognised in the financial statements when all of the
following criteria are met:
• The technical feasibility of completing the intangible asset so that
it will be available for use or sale is established;
• There is an intention to complete the intangible asset and use or
sell it;
• The Group has the ability to use or sell the intangible asset;
• The existence of a market for the output of the intangible asset or
the intangible asset itself or, if it is to be used internally, the usefulness
of the intangible asset can be demonstrated;
• Adequate technical, financial and other resources are available to
complete the development and to use or sell the intangible asset; and
• The Group has the ability to measure reliably the expenditure
attributable to the intangible asset during its development.
Where the above criteria are not met, costs incurred in research and
development are recognised in the Statement of Comprehensive Income as
incurred. Research costs are expensed as incurred.
Amortisation is recognised in order to write off the cost or valuation of the
assets, less their residual values over their useful lives. The development of
trading platforms has been amortised over 3 years on a straight-line basis
reflecting management's estimate of the useful life of the technology, the
rationale of which is discussed in Note 4.
Other intangibles
Website technology and communication licences represent externally acquired
intangible assets and are recognised in the financial statements as the Group
receives the right to control and use the product over a period of time.
Website technology represents external development costs to design the Group's
website. Communication licences relate to licences that transfer the right to
obtain a benefit from intellectual property. Amortisation on these assets is
recognised over 3 years on a straight-line basis which represents the
estimated useful life of both types of asset.
The price of and acquisition costs incurred when obtaining customer lists and
IP Addresses is capitalised in line with IAS 38. Management expects that
future economic benefits are attributable to the entity over an indefinite
term for these assets. Therefore, the useful economic life is considered
indefinite and no annual amortisation is recognised. These assets are
subsequently recognised as cost less impairment, and at each balance sheet
date Management conducts and impairment review which is at a minimum annually.
Business Combination
Business combinations are accounted for using the acquisition method. The cost
of an acquisition is measured as the aggregate of the consideration
transferred, which is measured at fair value.
Acquisition-related costs are expensed as incurred and recognised as
non-underlying transaction costs in the income statement.
Goodwill
The acquisition of AQSE gave rise to goodwill in the consolidated financial
statements. Goodwill is initially measured at cost, being the excess of the
aggregate of the consideration transferred over the net identifiable assets
acquired and liabilities assumed. Goodwill is assessed for impairment
annually, with any impairment charge recognised in the Statement of
Comprehensive Income. Note 18 provides further detail on the impairment
assessment for goodwill as at 31 December 2024.
Property, plant and equipment (excluding right-of-use assets)
All property, plant and equipment are stated at historical cost less
depreciation or impairment. Historical cost includes expenditure that is
directly attributable to the acquisition of the items.
Subsequent expenditure is included in the asset's carrying amount or is
recognised as a separate asset, as appropriate, only when it is probable that
future economic benefits associated with the item will flow to the Group and
the cost of the item can be measured reliably. All other repair and
maintenance costs are charged to the income statement during the financial
period in which they are incurred.
Depreciation is recognised so as to write off the cost or valuation of assets,
less their residual values, over their useful lives on the following basis:
• Fixtures, fittings and equipment: 5 years straight line.
• Computer equipment: 3 - 7 years straight line.
Impairment of tangible and intangible assets
At each reporting end date, the Group reviews the carrying amounts of its
tangible and intangible assets to determine whether there is any indication
that those assets have suffered an impairment loss. If any such indication
exists, the recoverable amount of the asset is estimated in order to determine
the extent of the impairment loss (if any). Where it is not possible to
estimate the recoverable amount of an individual asset, the Group estimates
the recoverable amount of the cash-generating unit to which the asset belongs.
The recoverable amount is the higher of fair value less costs to sell and
value in use. In assessing value in use, the estimated future cash flows are
discounted to their present value using a pre-tax discount rate that reflects
current market assessments of the time value of money and the risks specific
to the asset for which the estimates of future cash flows have not been
adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated
to be less than its carrying amount, the carrying amount of the asset (or
cash- generating unit) is reduced to its recoverable amount. An impairment
loss is recognised immediately in profit or loss, unless the relevant asset is
carried at a revalued amount, in which case the impairment loss is treated as
a revaluation decrease.
Cash and cash equivalents
Cash and cash equivalents include cash at bank.
The Group and Company as regulated bodies are required to maintain liquid cash
assets as part of their prudential reporting responsibilities to external
regulators. During the financial year ended 31 December 2024 the Group was
required to maintain £7,970k of available cash assets as part of its
liquidity requirements (Company £4,709k). Further details of the Group's risk
management approach to regulatory capital commitments are included in Note 5.
Financial assets
Trade and other receivables
Trade receivables are amounts due from customers for services performed in the
ordinary course of business. Other receivables are defined as amounts due that
are outside the ordinary course of business. If collection is expected in one
year or less (or in the normal operating cycle of the business if longer) they
are classified as current assets. Otherwise they are presented as non-current
assets.
Contract assets
Contract assets are recognised for licensing fees recognised at inception of a
licensing contract but not yet billed under IFRS 15. Contract assets are
initially measured at fair value and subsequently measured at amortised cost
and are stated net of any expected credit loss provision ("ECL") recognised in
accordance with IFRS 9, as detailed in Note 11. Contract assets are presented
on the Statement of Financial Position as trade receivables. The right to
consideration becomes unconditional once the customer has been billed.
Investments
Investments in equity instruments at fair value through other comprehensive
income (FVTOCI) are initially measured at fair value plus transaction costs.
Subsequently, they are measured at fair value with gains and losses arising
from changes in fair value recognised in other comprehensive income and
accumulated in the revaluation reserve. The cumulative gain or loss is not
reclassified to profit or
loss on disposal of the equity investments, instead, it is transferred to
retained earnings. Dividends on these investments in equity instruments are
recognised in profit or loss as other income when the Group's right to receive
payments is established, unless the dividends clearly represent a recovery of
part of the cost of the investment.
Rent deposit asset
Under IFRS 16 a rent deposit is accounted for as a financial asset if the
collateral provided to the lessor is not a payment relating to the right to
use the underlying assets and hence is not a lease payment as defined.
Further disclosures are provided in Note 28.
Impairment of financial assets
The Group has considered the impact of the application of an expected credit
loss model when calculating impairment losses on current and non- current
contract assets and other financial assets at amortised cost (presented within
trade and other receivables). In applying IFRS 9 the Group must consider the
probability of a default occurring over the contractual life of its trade
receivables and contract asset balances on initial recognition of those
assets.
Note 11 details the Group's credit risk assessment procedures.
Financial liabilities
After initial recognition all financial liabilities are subsequently measured
at amortised cost using the effective interest method. The effective interest
method is a method of calculating the amortised cost of a financial liability
and of allocating interest expense over the relevant period. The effective
interest rate is the rate that exactly discounts estimated future cash
payments (including all fees and points paid or received that form an integral
part of the effective interest rate, transaction costs and other premiums or
discounts) through the expected life of the financial liability, or (where
appropriate) a shorter period, to the amortised cost of a financial liability.
In 2024 the Group did not hold any financial liabilities beyond Trade and
other payables and the lease liabilities recognised under IFRS 16 as described
in the "Leases" sub-section below.
Trade and other payables
Trade payables are obligations to pay for goods or services that have been
acquired in the ordinary course of business from suppliers. Accounts payable
are classified as current liabilities if payment is due within one year or
less (or in the normal operating cycle of the business if longer). If not,
they are presented as non-current liabilities. Trade and other payables are
not interest bearing and are initially recognised at fair value.
Financial assets at fair value through profit or loss
Financial assets at fair value through profit or loss are carried at fair
value with net changes in fair value reflected in the income statement. This
category includes derivative instruments.
Equity instruments
Ordinary shares are classified as equity. Incremental costs directly
attributable to the issue of new ordinary shares or options are charged
against the share premium account.
Earnings per share
The earnings per share (EPS) calculations are based on basic earnings per
ordinary share as well as diluted earnings per ordinary share. The basic EPS
is calculated by dividing the profit after tax of the Group by the weighted
average number of ordinary shares that were in issue during the year. The
diluted EPS takes into account the dilution effects which would arise on
conversion of all outstanding share options and share awards under the
Enterprise Management Incentive (EMI) scheme.
Taxation
The tax expense/(credit) represents the sum of the tax currently
payable/(repayable) and movements in deferred tax balances.
A R&D tax credit is claimed annually from HMRC based on the employee costs
involved in developing Aquis' systems and technology. R&D tax credits are
offset against taxable profits or, when the company is in a tax loss position
claimed as a cash credit.
Current tax
The current income tax charge/(credit) is calculated on the basis of the tax
laws enacted or substantively enacted at the balance sheet date in the country
where the company operates and generates taxable income. 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 income tax is recognised, using the liability method, on temporary
differences arising between the tax bases of assets and liabilities and their
carrying amounts in the financial statements. Deferred income tax is
determined using tax rates (and laws) that have been enacted or substantially
enacted by the balance sheet date and are expected to apply when the related
deferred income tax asset is realised, or the deferred income tax liability is
settled.
Deferred income tax assets are recognised only to the extent that it is
probable that future measurable taxable profit will be available against which
the temporary differences can be utilised.
Deferred income tax assets and liabilities (Note 15) are offset when there is
a legally enforceable right to offset current tax assets against current tax
liabilities and when the deferred income taxes assets and liabilities relate
to income taxes levied by the same taxation authority on either the same
taxable entity or different taxable entities where there is an intention to
settle the balances on a net basis
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an
expense, unless those costs are required to be recognised as part of the cost
of group developed trading platforms.
The cost of any unused holiday entitlement is recognised in the period in
which the employee's services are received.
Termination benefits are recognised as an expense when the Group is
demonstrably committed to terminate the employment of an employee or to
provide termination benefits, as set out within IAS 19.
Retirement benefits
Pension obligations
The Group has no further payment obligations once the contributions have been
paid. The contributions are recognised as an employee benefit expense when
they are due. Prepaid contributions are recognised as an asset to the extent
that a cash refund or a reduction in the future payments is available.
Share-based payments
EMI Options
Equity-settled share-based payments are measured at fair value at the date of
grant. The fair value determined at the grant date is expensed on a
straight-line basis over the vesting period, based on the estimate of shares
that will eventually vest. A corresponding adjustment is made to equity.
When the terms and conditions of equity-settled share- based payments at the
time they were granted are subsequently modified, the fair value of the share-
based payment under the original terms and conditions and under the modified
terms and conditions are both determined at the date of the modification.
Any excess of the modified fair value over the original fair value is
recognised over the remaining vesting period in addition to the grant date
fair value of the original share-based payment. The share-based payment
expense is adjusted if the modified fair value is less than the original fair
value. Cancellations or settlements (including those resulting from employee
redundancies) are treated as an acceleration of vesting and the amount that
would have been recognised over the remaining vesting period is recognised
immediately.
Employee share incentive plan
Shares purchased under the share incentive plan are recognised as share-based
payments under IFRS 2. Partnership shares are purchased by employees and
matching shares are those purchased by Aquis at a ratio of 2:1. The shares are
held in a trust ("the Trust"), with matching shares required to be held for
three years before being transferred to the employee. The fair value of
matching shares are recognised in the share-based payment reserve.
Partnership shares vest immediately while matching shares will vest over the
three-year holding period. The market value of shares when they are purchased
is assumed to approximate the fair value of the shares.
The cash transferred to the Trust is recognised as an investment in the
Company's accounts. In line with IFRS 10 guidance, the Trust is consolidated
in the Group accounts with the fair value of the shares held in the trust
recognised as a debit entry within equity.
Restricted share plan
The Restricted share plan is a share based scheme awarded to staff and has a
vesting period of three years after grant subject to continued employment.
Similar to share-based payments they are measured at fair value determined at
the grant date. The fair value is expensed on a straight-line basis over the
vesting period, with the corresponding adjustment being made to reserves.
Company Share Option Plan
The company share option plan is a share based scheme awarded to staff and has
a vesting period of three years subject to continued employment. Similar to
share-based payments they are measured at fair value determined at the grant
date. The fair value is expensed on a straight-line basis over the vesting
period, with the corresponding adjustment being made to reserves.
Premium Priced Options Plan
The PPO scheme is an option based share scheme and has a vesting period of
three years after the grant date subject to continued employment. Similar to
share-based payments they are measured at fair value determined at the grant
date. The fair value is expensed on a straight-line basis over the vesting
period, with the corresponding adjustment being made to reserves.
Leases - as a lessee
The Group assesses whether a contract is or contains a lease at inception of
the contract. The Group recognises a right of use asset and a corresponding
lease liability with respect to all lease arrangements in which it is the
lessee, except for short-term leases (defined as leases with a lease term of
12 months or less) and leases of low value assets (such as tablets and
personal computers, small items of office furniture and telephones). For these
leases, the Group recognises the lease payments as an operating expense on a
straight-line basis over the term of the lease unless another systematic basis
is more representative of the time pattern in which economic benefits from the
leased assets are consumed.
The lease liability is initially measured at the present value of the lease
payments that are not paid at the commencement date, discounted by using the
rate implicit in the lease. Lease payments included in the measurement of the
lease liability comprise:
• Fixed lease payments (including in-substance fixed payments), less
any lease incentives receivable;
• Variable lease payments that depend on an index or rate, initially
measured using the index or rate at the commencement date;
• The amount expected to be payable by the lessee under residual value
guarantees;
• The exercise price of purchase options, if the lessee is reasonably
certain to exercise the options; and
• Payments of penalties for terminating the lease, if the lease term
reflects the exercise of an option to terminate the lease.
The lease liability is presented as a separate line in the consolidated
statement of financial position and is subsequently measured by increasing the
carrying amount to reflect interest on the lease liability (using the
effective interest method) and by reducing the carrying amount to reflect the
lease payments made. The Group remeasures the lease liability (and makes a
corresponding adjustment to the related right-of-use asset) whenever:
• The lease term has changed or there is a significant event or change
in circumstances resulting in a change in the assessment of exercise of a
purchase option, in which case the lease liability is remeasured by
discounting the revised lease payments using a revised discount rate.
• The lease payments change due to changes in an index or rate or a
change in expected payment under a guaranteed residual value, in which cases
the lease liability is remeasured by discounting the revised lease payments
using an unchanged discount rate (unless the lease payments change is due to a
change in a floating interest rate, in which case a revised discount rate is
used).
• A lease contract is modified and the lease modification is not
accounted for as a separate lease, in which case the lease liability is
remeasured based on the lease term of the modified lease by discounting the
revised lease payments using a revised discount rate at the effective date of
the modification.
The right-of-use assets comprise the initial measurement of the corresponding
lease liability, lease payments made at or before the commencement day, less
any lease incentives received and any initial direct costs. They are
subsequently measured at cost less accumulated depreciation and impairment
losses. The right-of-use assets are included in property, plant and equipment
in the consolidated statement of financial position and are depreciated over
the term of the lease. The Group applies IAS 36 to determine whether a
right-of-use asset is impaired and accounts for any identified impairment loss
as described in the 'Impairment of tangible and intangible assets' policy.
Variable rents that do not depend on an index or rate are not included in the
measurement of the lease liability and the right-of-use asset.
Foreign exchange
Functional and presentation currency
Items included in the financial statements of the Group are measured using the
currency of the primary economic environment in which the entity operates. The
financial statements are presented in UK Pound Sterling (£), which is the
Group's functional and presentational currency.
Transactions and balances
Foreign currency transactions are translated into the functional currency
using the exchange rates prevailing at the dates of the transactions. Foreign
exchange gains and losses resulting from the settlement of such transactions
and from the translation of monetary assets and liabilities denominated in
foreign currencies at year end exchange rates are recognised in profit or
loss.
All foreign exchange gains and losses recognised in the income statement are
presented net within 'operating expenses'. For the purpose of presenting
consolidated financial statements, the assets and liabilities of the Group's
foreign operations are translated at exchange rates prevailing on the
reporting date. Income and expense items are translated at the average
exchange rates for the period, unless exchange rates fluctuate significantly
during that period, in which case the exchange rates at the date of
transactions are used. Exchange differences arising, if any, are recognised in
other comprehensive income and accumulated in a foreign exchange translation
reserve.
On disposal of a foreign operation, exchange differences previously recognised
in other comprehensive income are reclassified to the income statement.
Foreign currency contracts used to manage foreign currency risk are accounted
for as derivatives as described above under "Financial instruments at fair
value through profit or loss".
Provisions
Provisions are recognised when the company has a present legal or constructive
obligation arising as a result of a past event, it is probable that an outflow
of economic benefits will be required to settle the obligation and a reliable
estimate can be made. All provisions are expected to be settled within a year
and thus the present value of amounts is materially consistent with the
undiscounted amount of future expected cash outflows.
Classification of costs as exceptional
The classification of certain costs as exceptional (see note 13) has a
significant impact on the calculation of certain alternative performance
measures. The classification of such costs as exceptional was determined
because they were not incurred in the normal course of business. Such costs
are not repeatable and their exclusion from the underlying business
performance was deemed necessary to avoid distortion in the underlying
performance of the Group.
Valuation of derivatives
The company uses foreign currency forwards to manage its exposure to exchange
rate fluctuations. Although in the current period the reported value is
immaterial, there is potential for changes based on large currency or relative
interest rate shifts. As such, they are a source of estimation uncertainty.
Note 24 provides additional information on the fair value of derivatives.
3. Adoption of new and revised standards and changes in accounting policies
New IFRS Standards that are effective for the current year
The following amended standards are effective as of 2024. These have not
impacted the current year financial statements.
Amendments to IAS 1 Presentation of Financial Statements Classification of Liabilities as Current or Non-current (Issued January 2020)
and Non-current Liabilities with Covenants (Issued October 2022)
Amendments to IFRS 16 Leases Lease Liability in a Sale and Leaseback (Issued September 2022)
Amendments to IAS 7 Statement of Cash Flows and IFRS 7 and IFRS 9 Financial Supplier Finance Arrangements (Issued May 2023)
Instruments
Standards which are in issue but not yet effective
At the date of authorisation of these financial statements, the following
Standards and Interpretations, which have not yet been applied in these
financial statements, were in issue. The Directors do not expect that the
adoption of the Standards listed below will have any impact on the financial
statements of the Group in future periods:
Amendments to IAS 21 The Effects of Changes in Foreign Exchange Rates: Lack of Exchangeability
(Issued August 2023) - effective 1 January 2025
Amendments to IFRS 9 and IFRS 7 Amendments to the Classification and Measurement of Financial Instruments
(Issued May 2024) - effective 1 January 2026
IFRS 18 Presentation and disclosure in Financial Statements effective 1 January 2027
IFRS 19 Subsidiaries without Public Accountability: Disclosures effective 1 January
2027
4. Critical accounting estimates and judgements
In applying the Group's accounting policies, which are described in Note 2,
the Directors are required to make judgements, estimates and assumptions about
the carrying amount of assets and liabilities that are not readily apparent
from other sources. Management has shown these matters as judgements where
they relate to a significant policy and the judgement has a material impact on
the reported balance. The estimates and associated assumptions are based on
historical experience and other factors that are considered to be relevant.
Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis.
Revisions to accounting estimates are recognised in the period in which the
estimate is revised if the revision affects only that period, or in the period
of the revision and future periods if the revision affects both current and
future periods.
Critical judgements
The following are the critical judgements, apart from those involving
estimations (which are presented separately below), that the Directors have
madein the process of applying the Group's accounting policies and that have
the most significant effect on the amounts recognised in financial statements.
Judgements in relation to performance obligations
In making their judgement, the Directors considered the detailed criteria for
the recognition of revenue set out in IFRS 15, and in particular, whether
revenue is recognised at a point in time or over time. Following an assessment
of the technology licensing contract portfolio, and the obligations that Aquis
has under each contract, the Directors are satisfied that obligations
contained therein be split into the following performance obligations, and
that the revenue from each licensing contract should be assessed individually.
The identified performance obligations and the timing of revenue recognition
on delivering the licence contracts as follows:
• Implementation/ project fees: these are upfront, non-refundable fees
that a customer pays in order to obtain the user agreement. Even if the user
acceptance certificate is never issued, the implementation fee cannot be
reclaimed and so the revenue is guaranteed and can be recognised from the time
of invoice as Aquis becomes unconditionally entitled to payment but in
practice recognition will often be deferred until the work is completed.
• Licensing fees: The customer is liable to pay the monthly licensing
fee from the date of signing the user acceptance agreement (contract inception
date). At this point in time Aquis has fulfilled its promise to deliver the
licence (i.e. the system has been deployed in the client's production
environment) and this performance obligation is fulfilled. Management uses
judgement when assessing the recoverability of the licencing fees, and
recognises them only when their collection is assumed to be highly probable.
This assessment takes into consideration the current status of the client's
business, including whether the exchange system is active with products/
securities added and members trading on it. The licensing fees are recognised
at a point in time, which occurs after the contract is signed and once Aquis
is satisfied that receiving the licencing fees is highly probable.
• Maintenance fees: fees to maintain the system are recognised over
the course of the licensing contract as Aquis fulfils its performance
obligation to maintain the system. Management have estimated a fixed annual
amount per contract, which reflects the time spent supporting the client's
platform and upgrading the software in accordance with the contractual terms.
• Live services: fees charged to support infrastructure, operations,
and first-line market surveillance as part of running regulatory grade
exchanges. These services are recognised over time when Aquis provides the
service.
• Hosting: these fees are charged for the use of Aquis' hardware on a
monthly basis. These services are recognised over time as the customer
requires.
Changes in identification of performance obligations could impact the timing
of revenue recognition for licensing contract assets and is thus a critical
accounting judgement.
Capitalisation of internally generated intangible assets resulting from
Research and Development
Internally generated intangible assets are capitalised when, in management's
judgement, the criteria for capitalisation under IAS 38 (listed in Note 2)
have been met. The direct costs incurred in the research and development of
Aquis' exchange platform and associated technology and systems are
capitalised. Management reviews the time spent by the development team in
developing and maintaining the systems used internally by Aquis when
determining the amount to be capitalised within each period.
Critical accounting estimates
The key assumptions concerning the future, and other key sources of estimation
uncertainty at the reporting date that may have a significant risk of causing
a material adjustment to the carrying amounts of assets and liabilities within
the next financial year, are discussed below.
Estimating the useful life of intangible assets
The expected useful life of most intangible asset is estimated to be 3 years,
but some intangible assets are considered to have an indefinite useful
economic life. In making this judgement management have taken into account
product upgrade cycles, the pace of change of regulation as well as
benchmarking against other companies with internal systems and technology
research and development. Intangible assets with indefinite lives are reviewed
for indicators of impairment at the end of each accounting period.
Expected credit loss of contract assets
An impairment for the expected credit loss of contract assets that arise as a
result of applying IFRS 15 to licensing revenue is required under IFRS 9. This
impairment is an accounting estimate which is calculated based on the
Directors' best estimates of the probability of default and loss given
default. The quantification of the assumptions and stresses for the year are
disclosed in Note 11 of the financial statements.
In arriving at these estimates, the Directors have assessed the range of
possible outcomes using reasonable and supportable forward-looking
information, which is based on assumptions for the future movement of
different economic drivers and how these drivers will affect each other.
Aquis' assessment of the credit risk associated with a licensing customer is
conducted at inception of the contract (but before the user agreement is
signed) and includes factors that are specific to the customer, general
economic conditions and an assessment of both the current as well as the
forecast direction of these conditions.
The credit risk assessment is conducted by means of a take-on assessment which
comprises of a series of relevant criteria for a licensing contract that are
scored according to the specific circumstances of the customer, with scores
for each parameter typically ranging from 1-5. The assessment evaluates the
following:
• Level of funding;
• Regulatory approvals;
• Market, industry and business model;
• Macro-economic forecasts;
• Corporate governance/ Group management;
• Whether the client is revenue generating;
• Level of client profitability;
• Contract length and the associated range of economic scenarios
therein;
• Payment history; and
• External credit ratings.
The above assessment will determine the customer category upon inception of
the contract, and the inputs to the expected credit loss model is determined
thereon.
The credit risk assessment and associated inputs to the expected credit loss
model (probability of default and loss given default) are critical assessments
that could impact both the provision for expected credit losses as well as the
movement in the provision reflected in the income statement.
Deferred tax asset
Deferred tax assets (Note 15) are recognised to the extent that their
utilisation is probable. The utilisation of deferred tax assets will depend on
whether it is possible to generate sufficient taxable income in the respective
tax type and jurisdiction. A total net deferred tax asset is recognised in the
current period, since profitability is expected to continue for at least the
next 3 years. The deferred tax asset is calculated based on expected
profitability over this period as Aquis is a high growth company and there is
considerable uncertainty in estimating financial performance beyond this
length of time.
Various factors are used to assess the probability of the future utilisation
of deferred tax assets, including, operational plans and loss-carry forward
periods. To reflect the uncertainty in the accuracy of business forecasts, the
model uses modest growth rates and applies a probability weighting to each
type of revenue.
Share-based payments
The US binomial model and Black Scholes model are used to estimate the fair
value of the EMI, CSOP, RSP and PPO options. The resulting fair values are
recognised over the vesting period as an expense in the Income Statement, with
the corresponding amounts recognised as equity in the balance sheet. The model
requires the following inputs: grant date, exercise price, expiry, expected
life of options, expected volatility, and the risk-free interest rate. The
expected life and expected volatility require the use of estimates. Volatility
is estimated based on the historical average for the available data up to the
grant date, while the expected life of the options is based on management's
judgement of when the options will be exercised, which is assumed to be an
average of 3-5 years.
5. Financial risk management
The Group seeks to protect its financial performance and the value of its
business from exposure to adverse changes in capital commitments, as well as
credit, liquidity and foreign exchange risks.
The Group's financial risk management approach is not speculative. The Group's
Audit, Risk and Compliance Committee provides assurance that the governance
and operational controls are effective to manage risks within the
Board-approved risk appetite, supporting a robust Group risk management
framework.
The Group's objectives when managing these risks are detailed below.
Capital risk management and capital commitments
Risk description Risk management approach
There is a risk that Group entities may not maintain sufficient capital to Group's objectives when managing capital are to safeguard the Group's ability
meet their obligations. The Group comprises regulated entities. It considers to continue as a going concern so that it can provide returns for shareholders
that increases in the capital requirements of its regulated companies, or a and benefits for other stakeholders.
scarcity of equity (driven by its own performance or financial market
conditions) either separately or in combination are the principal risks to
managing its capital.
The Group has mitigated the level of risk significantly by ensuring that, as
set out within the risk description, each entity in the Group maintains a
level of capital that is well in excess of regulatory requirements.
AQXE has a total capital regulatory requirement of £6.2m as at 31 December Maintaining a strong capital structure is a key priority for the Group. If
2024, with available capital of £24.9m, reflecting a surplus of £18.7m, or there was an erosion of capital for any reason the Group may issue new shares
301%. The total regulatory requirement is set as the total capital ratio plus or sell assets to ensure capital adequacy requirements continue to be met. The
Pillar 2 add on. directors have assessed the impact of a 10% fall in the Group's available
capital and concluded the impact not to be material.
Within the AQSE subsidiary the capital regulatory minima are set by the FCA
through the Financial Resource Requirement (FRR) which is currently set at The Group continuously monitors its level of capital in order to ensure it
£2.5m. Financial resources available (representing net assets) were £4.8m at remains compliant with regulatory capital requirements and performs monthly
31 December 2023, reflecting a £2.4m headroom above regulatory minima. and quarterly reporting on capital balances and associated headroom. Proposed
investment requirements, capital expenditure and potentially increasing
capital resources through equity or debt issuance are assessed annually as
part of the budgeting process, as well as on an ad-hoc basis as required.
Credit risk
Risk description Risk management approach
The Group's credit risk relates to its customers being unable to meet their The Directors make a judgement on the credit quality of the Group's customers
obligations to the Group either in part or in full. based upon the customers' financial position, the recurring nature of billing
and collection arrangements and, historically, a low incidence of default.
Aquis' assessment of the credit risk associated with a licensing customer is
conducted at inception of the contract (but before the user agreement is
signed) and includes factors that are specific to the customer, general
economic conditions and an assessment of both the current as well as the
forecast direction of these conditions. Based on this assessment, the
prospective customer is assigned to a customer category with an appropriate
risk rating.
Aquis' credit risk management processes are applied to all trade receivables
and are calculated using a lifetime ECL method, as detailed in Note 11. The
Directors have stress tested the current approach to managing this risk and
believe it to be appropriate.
If 10% of trade receivables outstanding from 31 December 2024 were to default,
the hypothetical impairment charge would be £388k. This is compared to
recognised provisions of £778k.
Liquidity Risk
Risk description Risk management approach
The Group's operations are exposed to liquidity risk to the extent that they The Group maintains sufficient liquid resources to meet its financial
are unable to meet their daily payment obligations. obligations as and when they become due in the ordinary course of business.
Management monitors forecasts of the Group's cash flow quarterly through an
assessment of cash resources that are in excess of regulatory capital
requirements. The Group is solvent with net current assets in excess of £15.9
million (2023: £17.2 million), with the majority of the debtor's book being
short term in nature. The Group is also funded entirely by equity, with no
external debt funding obligations to be met. The Directors have stress tested
the current approach to managing this risk and believe it to be appropriate.
If group net assets were to fall by 10% there would still be a significant
surplus to meet the Group's liabilities as they fall due.
Interest Rate Risk
Risk description Risk management approach
The Group is not materially exposed to market risk including interest rate Bank deposits are primarily placed for one week at a time. The Directors have
(see below for FX risk). stress tested the current approach to managing this risk and believe it to be
appropriate. The only adverse impact would be if interest rates were to fall
and reduce interest income on bank deposits. As at 31 December 2024 total
interest income on deposits was £0.6 million (2023: £0.4 million).
There is no negative exposure to interest rate changes since the Group and
Company have no external debt obligations, and the interest rate on the lease
liability is the rate implicit in the lease and as such is not subject to
change over the term of the lease.
FX Risk
Risk description Risk management approach
The Group operates in the UK and Europe, with Sterling as its principal Foreign exchange risk has previously arisen on foreign currency denominated
currency of operation. The Group invoices its customers primarily in GBP, but costs within Aquis Exchange PLC or through the translation of GBP denominated
some contracts have been structured using USD and as such foreign exchange balances within Aquis Exchange SAS. At the end of 2022 Aquis entered into a
risk arises from invoicing in USD. The Group incurs the majority of expenses USD denominated technology contract and hence opened a USD account which holds
in GBP, but some costs are denominated in USD and EUR. a low level of USD at the year end £0.03 million (2023: £0.17 million). The
contract delivers USD cash flows which are managed by use of USD forward
strips.
The value of the USD denominated contract is considered material to Group and
Company's balance sheet. However, the foreign exchange exposure for costs
invoiced in other currencies is considered immaterial. As at the year end at 31 December 2024 the value of the FX forward was out of
the money at £3,219 (2023: in the money at £51,407). The Directors performed
stress testing on the cost base of the group in non-functional currencies and
concluded that an adverse movement of 10% versus GBP would not render a
An immaterial amount of cash held by Aquis Exchange Europe SAS is held in a material impact.
euro denominated bank account and an immaterial amount of USD held by Aquis
Exchange PLC, with the remaining cash held in Sterling denominated bank
accounts.
The statement of financial position is analysed below:
Group Amortised Fair Value through P&L Fair Value through OCI Non-financial instruments Total in the Statement of Financial Position
Cost
31 December 2024
Trade and other receivables 9,347,423 - - 1,475,893 10,823,316
Cash and bank balances 13,699,076 - - - 13,699,076
Investments - - 1,176,021 - 1,176,021
Provisions - - - (343,784) (343,784)
Trade and other payables (3,375,472) - - (1,195,747) (4,571,219)
Lease Liabilities (2,549,566) - - - (2,549,566)
Derivatives - (3,219) - - (3,219)
31 December 2023
Trade and other receivables 11,513,884 - - 1,192,141 12,706,025
Cash and bank balances 14,765,910 - - - 14,765,910
Investments - - 591,945 - 591,945
Trade and other payables (2,632,181) - - (1,311,950) (3,944,131)
Lease Liabilities (2,984,444) - - - (2,984,444)
Derivatives - 51,407 - - 51,407
Company Amortised Fair Value through P&L Fair Value through OCI Non-financial instruments Total in the Statement of Financial Position
Cost
31 December 2024
Trade and other receivables 10,215,685 - - 1,365,682 11,581,367
Cash and bank balances 5,745,324 - - - 5,745,324
Investments - - 1,176,021 - 1,176,021
Provisions - - - (343,784) (343,784)
Trade and other payables (5,809,244) - - (208,201) (6,017,445)
Lease Liabilities (2,172,188) - - - (2,172,188)
Derivatives - (3,219) - - (3,219)
31 December 2023
Trade and other receivables 11,490,229 - - 1,042,632 12,532,861
Cash and bank balances 6,356,259 - - - 6,356,259
Investments - - 591,945 - 591,945
Trade and other payables (2,971,755) - - (256,777) (3,228,532)
Lease Liabilities (2,537,883) - - - (2,537,883)
Derivatives - 51,407 - - 51,407
The following tables detail the Group and Company's remaining contractual
maturity for its non-derivative financial liabilities with agreed repayment
periods. The tables have been drawn up based on the undiscounted cash flows of
financial liabilities based on the earliest date on which the Group or Company
can be required to pay.
Group 1 Year 2-5 years 5+ years Total
31 December 2024
Trade and other payables 4,571,219 - - 4,571,219
Lease Liabilities 511,989 1,537,655 802,744 2,852,388
5,083,208 1,537,655 802,744 7,423,607
31 December 2023
Trade and other payables 3,956,088 - - 3,956,088
Lease Liabilities 515,382 1,551,230 1,319,824 3,386,436
4,471,470 1,551,230 1,319,824 7,342,524
Company 1 Year 2-5 years 5+ years Total
31 December 2024
Trade and other payables 6,017,445 - - 6,017,445
Lease Liabilities 437,400 1,239,300 765,450 2,442,150
6,454,845 1,239,300 765,450 8,459,595
31 December 2023
Trade and other payables 3,228,532 - - 3,228,532
Lease Liabilities 437,400 1,239,300 1,202,850 2,879,550
3,665,932 1,239,300 1,202,850 6,108,082
6. Operating segments
The Aquis Group can be split into four revenue streams, each offering multiple
products and services and benefitting from Group synergies. The specific focus
of these activities are:
(1) Aquis Markets - operator of MTF and related services. The
Group operates two MTFs: Aquis Exchange ("AQXE"), which is UK regulated and
Aquis Exchange Europe ("AQEU"), which is French regulated;
(2) Aquis Stock Exchange ("AQSE") - primary listings and trading
business. Within this division is AQSE Main Market, AQSE Growth Market and
AQSE Trading;
(3) Aquis Technologies - developer of exchange technology and
services. The product offering includes Aquis Matching Engine, Aquis Market
Surveillance, Aquis Market Gateway and related services including market
surveillance and operations.
(4) Aquis Data - Market Data services across the MTF and
Recognised Investment Exchanges operated by Group entities.
Aquis Exchange PLC is the parent company and comprises AQXE and Aquis
Technologies. It owns 100% of its two subsidiaries, AQEU and AQSE. Management
monitors the Group's overall performance regularly using a set of established
Key Performance Indicators including Net revenue, and Adjusted EBITDA and
Adjusted Profit Before Tax after exceptional costs. When monitoring the
performance of each operating segment individually, management examines the
discrete financial information available which will normally include revenue
and gross profit for each division. Assets and liabilities, income tax and
IFRS 2 charges are not reported internally to Chief Operating Decision Makers.
In line with IFRS 8 the operating segments are reported separately as follows:
2024 Group Aquis Markets Aquis Stock Exchange Aquis Technologies Aquis Data Total
Revenue 11,775,892 1,768,077 5,264,639 4,963,407 23,772,015
Impairment credit / (charge) on Contract Assets - - (3,685,326) - (3,685,326)
Net revenue 11,775,892 1,768,077 1,579,313 4,963,407 20,086,689
Impairment (charge) on trade and other receivables - (100,839) (601,598) - (702,437)
Other losses (41,906) (5,867) (73,064) (17,600) (138,437)
Operating expenses before exceptionals (7,539,513) (1,383,705) (3,491,016) (3,327,542) (15,741,776)
Share based payments (653,353) (105,753) (294,398) (289,490) (1,342,994)
Adjusted EBITDA (before exceptionals) 3,541,120 171,913 (2,880,763) 1,328,775 2,161,045
Exceptional Recommended Offer costs (1,676,678) (239,436) (717,591) (710,158) (3,343,863)
EBITDA 1,864,859 (67,523) (3,598,354) 618,617 (1,182,818)
Depreciation, amortisation and net interest (369,583) (54,352) (462,461) (157,435) (1,043,831)
Profit / (loss) before tax 1,494,859 (121,875) (4,060,815) 461,182 (2,226,649)
Reconciliation of PBT to Adjusted PBT:
Profit / (loss) before tax 1,494,859 (121,875) (4,060,815) 461,182 (2,226,649)
Exclude exceptional Recommended Offer costs 1,676,678 239,436 717,591 710,158 3,343,863
Adjusted profit / (loss) before tax 3,171,537 117,561 (3,343,224) 1,171,340 1,117,214
2023 Group Aquis Markets Aquis Stock Exchange Aquis Technologies Aquis Data Total
Revenue 10,919,263 1,771,284 7,298,157 3,722,237 23,710,941
Impairment credit / (charge) on Contract Assets - - (1,016,223) - (1,016,223)
Net revenue 10,919,263 1,771,284 6,281,934 3,722,237 22,694,718
Impairment (charge) on trade and other receivables - (19,787) (58,108) (1,500) (79,395)
Other gains - - 51,407 - 51,407
Operating expenses (7,134,010) (1,634,472) (3,550,170) (2,992,168) (15,310,820)
Share based payments (499,963) (81,102) (334,162) (170,431) (1,085,658)
EBITDA (and Adjusted EBITDA) 3,285,290 35,923 2,390,901 558,138 6,270,252
Depreciation, amortisation and net interest (292,793) 4,626 (583,951) (203,247) (1,075,365)
Profit before tax 2,992,497 40,549 1,806,950 354,891 5,194,887
The tables above represent the segment-level information that is monitored by
the Chief Operating Decision Makers, which are the Chief Executive Officer,
Chief Operating Officer and the Chief Financial Officer. All non-current
assets (contract assets) are held centrally by Aquis Exchange PLC, other than
the lease for the Paris office assigned to AQEU. The geographical analysis of
the non-current assets is as follows; UK: £7,135k, Singapore: £2,754k and
South Africa: £1,675k, Total: £11,564k.
At a Group level revenue from any one customer does not exceed 10% of total
Group Revenue (2023: none). At a Company level revenue from one technology
licence customer exceeded 10% of total Company revenues, and amounted to
£3,100k (2022: two customers totalled £4,171k).
2024 Company Aquis Markets Aquis Stock Exchange Aquis Technologies Aquis Data Total
Revenue 3,789,253 - 5,264,639 2,626,926 11,680,818
Impairment credit / (charge) on Contract Assets - - (3,685,326) - (3,685,326)
Net revenue 3,789,253 - 1,579,313 2,626,926 7,995,492
Impairment (charge) on trade and other receivables - - (601,598) - (601,598)
Other gains (41,906) (5,867) (73,064) (17,600) (138,437)
Operating expenses before exceptionals (56,816) - (3,491,016) (1,131,843) (4,679,675)
Share based payments (653,353) (105,753) (294,398) (289,490) (1,342,994)
Adjusted EBITDA (before exceptionals) 3,037,178 (111,620) (2,880,763) 1,187,993 1,232,788
Exceptional Recommended Offer costs (1,652,335) (239,436) (717,591) (710,158) (3,319,520)
EBITDA 1,384,843 (351,056) (3,598,354) 477,835 (2,086,732)
Depreciation, amortisation and net interest (687,589) (54,352) (462,461) (157,435) (1,361,837)
Profit / (loss) before tax 697,254 (405,408) (4,060,815) 320,400 (3,448,569)
Reconciliation of PBT to Adjusted PBT:
Profit / (loss) before tax 697,254 (405,408) (4,060,815) 320,400 (3,448,569)
Exclude exceptional Recommended Offer costs 1,652,335 239,436 717,591 710,158 3,319,520
Adjusted profit / (loss) before tax 2,349,589 (165,972) (3,343,224) 1,030,558 (129,049)
2023 Company Aquis Markets Aquis Stock Exchange Aquis Technologies Aquis Data Total
Revenue 3,994,208 - 7,298,157 1,854,974 13,147,339
Impairment credit / (charge) on Contract Asset - - (1,016,223) - (1,016,223)
Net revenue 3,994,208 - 6,281,934 1,854,974 12,131,116
Impairment (charge) on trade and other receivables - - (58,108) (1,500) (59,608)
Other gains - - 51,407 - 51,407
Costs (742,211) - (3,550,170) (1,496,084) (5,788,465)
Share based payments (499,963) (81,102) (334,162) (170,431) (1,085,658)
EBITDA (and Adjusted EBITDA) 2,752,034 (81,102) 2,390,901 186,959 5,248,792
Depreciation, amortisation and net interest (579,451) 4,626 (583,951) (101,624) (1,260,400)
Profit before tax 2,172,583 (76,476) 1,806,950 85,335 3,988,392
7. Employees
The monthly average number of persons (including directors) employed by the
Group during the year was:
Group 2024 2023
Number Number
Management 3 3
IT 30 23
Compliance and Surveillance 14 13
Operations 8 8
Business Development 21 21
Finance / HR / Admin 6 5
Marketing 2 2
84 75
Company 2024 2023
Number Number
Management 2 2
IT 27 21
Compliance and Surveillance 7 6
Operations 8 8
Business Development 14 13
Finance / HR / Admin 5 5
Marketing 2 2
65 57
Group 2024 2023
£ £
Salaries and wages 8,459,538 7,523,034
Social security costs 1,085,216 1,056,857
Defined contribution pension costs 390,188 314,281
Share based payments 1,342,994 1,085,658
Employee benefits 243,248 238,727
11,521,184 10,218,557
Company 2024 2023
£ £
Salaries and wages 5,964,882 5,264,174
Social security costs 732,217 766,553
Defined contribution pension costs 268,239 207,351
Share based payments 1,342,994 1,085,658
Employee benefits 237,483 238,723
8,545,815 7,562,459
8. Retirement benefit scheme
Defined contribution schemes
The Group operates a defined contribution pension scheme for all qualifying
employees. The assets of the scheme are held separately from those of the
Company in an independently administered fund.
A defined contribution plan is a pension plan under which the Group pays fixed
contributions into a separate entity. The Group has no legal or constructive
obligations to pay further contributions if the fund does not hold sufficient
assets to pay all employees the benefits relating to employee service in the
current and prior periods.
The total cost at a Group and Company level for defined contribution schemes
is included in note 7.
9. Directors' remuneration
Further details on Directors' remuneration are included within the Directors'
Report.
Company 2024 2023
£ £
Short-term employee benefits 1,048,196 1,096,773
Additional salary in lieu of pension contributions 33,625 26,465
Remuneration disclosed above include the following amounts paid to the highest
paid director:
2024 2023
£ £
Short-term employee benefits 387,330 419,001
Additional salary in lieu of pension contributions 18,500 14,000
There are no directors to whom retirement benefits are accruing in respect of
qualifying services. No directors exercised share options in the year (2023:
none).
10. Revenue
An analysis of the Group's revenue by product for each segment is as follows:
2024 Group Aquis Markets Aquis Aquis Data Aquis Stock Total
Technologies Exchange
Exchange fees 11,775,892 - - 636,401 12,412,293
Licence fees - 5,264,639 - - 5,264,639
Data vendor fees - - 4,963,407 - 4,963,407
Issuer fees - - - 1,131,676 1,131,676
Total 11,775,892 5,264,639 4,963,407 1,768,077 23,772,015
2023 Group Aquis Markets Aquis Aquis Data Aquis Stock Total
Technologies Exchange
Exchange fees 10,919,263 - - 663,068 11,582,331
Licence fees - 7,298,157 - - 7,298,157
Data vendor fees - - 3,722,237 - 3,722,237
Issuer fees - - - 1,108,216 1,108,216
Total 10,919,263 7,298,157 3,722,237 1,771,284 23,710,941
2024 Company Aquis Markets Aquis Aquis Data Aquis Stock Total
Technologies Exchange
Exchange fees 3,789,253 - - - 3,789,253
Licence fees - 5,264,639 - - 5,264,639
Data vendor fees - - 2,626,926 - 2,626,926
Issuer fees - - - - -
Total 3,789,253 5,264,639 2,626,926 - 11,680,818
2023 Company Aquis Markets Aquis Aquis Data Aquis Stock Total
Technologies Exchange
Exchange fees 3,994,208 - - - 3,994,208
Licence fees - 7,298,157 - - 7,298,157
Data vendor fees - - 1,854,974 - 1,854,974
Issuer fees - - - - -
Total 3,994,208 7,298,157 1,854,974 - 13,147,339
Revenues from customers attributable to each of the following countries was as
follows:
Group Company
2024 2023 2024 2023
£ £ £ £
Country
Australia 74,081 57,000 42,444 33,567
British Virgin Islands 44,961 3,625 - -
Canada 40,023 4,150 - -
Cayman Islands 18,563 - - 1,422
China 42,051 142,000 21,000 -
Colombia 233,183 39,329 233,183 -
Cyprus 9,281 - - -
Denmark 39,353 32,238 15,105 -
Finland 30,000 24,000 19,650 -
France 1,347,201 1,215,591 504,208 179,094
Germany 425,293 425,349 144,369 106,432
Gibraltar 13,931 4,000 - -
Guernsey 21,222 2,100 - -
Hong Kong 30,000 24,000 19,650 105,681
Hungary 43,490 35,000 3,033 -
Ireland 1,677,677 1,517,301 584,719 103,278
Isle of Man 28,144 825 - -
Italy 35,000 24,000 22,925 -
Jersey 38,025 1,300 - -
Kenya 21,006 14,150 - -
Luxembourg - 2,177 - 21,336
Netherlands 354,858 158,239 146,517 54,841
New Zealand 12,037 - - -
Norway 49,390 38,025 - -
Singapore 220,506 483,311 220,506 -
South Africa 119,626 109,245 109,245 109,245
Spain 106,106 79,872 13,844 -
Sweden 30,000 24,000 19,650 7,965
Switzerland 214,277 222,330 87,068 113,107
Taiwan 9,281 - - -
United Arab Emirates 9,281 - - -
United Kingdom 15,676,421 17,432,294 7,719,768 10,920,149
United States 2,757,747 1,595,490 1,753,934 1,391,222
23,772,015 23,710,941 11,680,818 13,147,339
Subscription fees and data vendor fees:
Subscription fees and some data vendor fees are accounted for under IFRS 15
and are all recognised at point in time as they reflect variable revenue
determined on a monthly basis. In addition to the variable monthly fee some
AQSE data vendors pay an annual fee for access to real time and/or end of day
data, which is recognised over time as the performance obligation of providing
data is fulfilled.
The Group begins to recognise monthly subscription fees, data vendor fees, and
connectivity fees when the customer conformance test is satisfactorily
concluded, and an acceptance certificate is issued. This is then verified by
the customer starting to utilise the platform, which is the point in time that
the Group determines that the customer has received the benefit from the
service.
In the case of subscription, connectivity and data fees, invoices are raised
monthly in arrears and there is no obligation for a refund, return or any
other similar obligation. There is no constrained variable consideration in
any customer contracts, and the transaction price is allocated in full at a
single point in time when the customer receives the benefit from the services.
Licence fees and contract assets:
Aquis Exchange PLC provides technology services under licence to clients. The
services comprise the provision of an exchange platform and / or a
surveillance system and may also include support services comprising basic
infrastructure support or additional services. The duration of the licences
varies between 1 and 7 years and will consist of an implementation fee, and,
post implementation, a monthly licence fee for the duration of the contract.
The monthly fees also cover system maintenance and system upgrades that
typically occur every 12 - 18 months. The licensing contracts are accounted
for under IFRS 15 and any corresponding contract assets are subject to IFRS 9
provisioning, as disclosed further in Note 11. Contract liabilities arise when
consideration has been provided to Aquis prior to completion of relevant
performance obligations as outlined below. These balances typically arise when
customers pay in advance of implementation. As of the balance sheet date there
are no contract liabilities (2023: nil).
The revenue from licensing contracts with customers has been categorised
reflecting the nature, amount, customer categorisation (see also Note 4),
contract duration and uncertainty of revenue and cash flows. Revenue from
licensing contracts is assessed for each contract and is recognised as and
when each performance obligation is satisfied. A transaction price is
determined by the contractual terms of an agreement. Transaction prices are
allocated to each performance obligation based on the standalone price of the
product or service offered by the Group. The list of performance obligations
included within Aquis' Technology Licence agreements is outlined below.
For licensing contracts, the Company has assessed the expected credit loss of
each client individually. The transaction price is allocated according to the
Group's obligations to the client over the course of licence period. There is
no constrained variable consideration in any customer contracts.
The licensing fees line item also includes connectivity fees for licensing
contract customers that are recognised at a point in time as they reflect
variable revenue determined on a monthly basis and are underpinned by a
separate agreement.
Contract Assets (Group and Company) 2024 2023
£ £
As at 1 January 8,480,444 6,114,105
PO2: Licence fees 3,670,000 5,419,476
PO3: Maintenance fees 680,648 449,533
ECL provisions on contract assets (3,535,326) (1,016,223)
Transfers to trade receivables (3,071,416) (2,345,265)
Adjustments for foreign exchange gains 21,963 (141,182)
As at 31 December 6,246,313 8,480,444
In the prior year the scope of a Technology Licence contract was amended
resulted in cumulative catch- up adjustments of £86,400 being recognised
despite satisfaction of their performance obligation in prior periods.
Upon invoicing of revenues the right to consideration becomes unconditional
and thus contract asset balances have been reduced for balances transferred to
trade receivables. The unrecovered amount included in receivables is
£1,430,033 (2023: £626,607).
Performance obligation (PO) Recognition of revenue upon completion
PO1: Implementation fees Implementation/ project fees are upfront, non-refundable fees that a customer
pays in order to obtain the user agreement. Even if the user acceptance
certificate is never issued, the implementation fee cannot be reclaimed and so
the revenue is guaranteed and can be recognised at the time of invoice as
Aquis becomes unconditionally entitled to payment.
PO2: Licencing fees At a point in time upon signing the user acceptance agreement, as the Company
has fulfilled its promise to deliver the licence (i.e. the system has been
deployed in the client's production environment). A corresponding contract
asset (trade receivable) is recognised to reflect the customer's obligation to
pay the monthly licensing fee over the remaining term of the contract.
PO3: Maintenance fees Over the course of the licensing contract, as the performance obligation to
maintain the system is settled and the customer benefits from using the
system.
PO4: Live services fees Over the course of the licensing contract, as the performance obligation to
provide surveillance and similar core market operations tasks are settled and
the customer benefits over time.
PO5: Hosting fees Over the course of the licensing contract, as the performance obligation to
use Aquis' hardware and infrastructure is used over time by the customer.
The aggregate amount of the transaction price per customer category that has
been allocated to the performance obligations for the year is as follows:
2024
Group and Company £ £ £ £ £ £
Risk Category(1) 1 2 3 4 5 Total
PO1 240,658 - 50,000 - - 290,658
PO2 - 2,925,000 745,000 - - 3,670,000
PO3 239,583 296,861 125,000 19,204 - 680,648
PO4 - - 84,834 - - 84,834
PO5 - 252,000 - - - 252,000
480,241 3,473,861 1,004,834 19,204 - 4,978,140
2023
Group and Company £ £ £ £ £ £
Risk Category(1) 1 2 3 4 5 Total
PO1 65,000 500,000 280,630 - - 845,630
PO2 2,550,000 2,027,500 85,586 756,390 - 5,419,476
PO3 62,457 239,453 125,000 22,623 - 449,533
PO4 - - - - - -
PO5 - 42,000 - - - 42,000
2,677,457 2,808,953 491,216 779,013 - 6,756,639
The amount of revenue to be recognised from unsatisfied performance
obligations with Technology Licence customers is as follows:
Group and Company 2024 2025 2026 2027-2030 Total
As at 31 December 2024 £ £ £ £ £
PO3 613,449 604,395 519,434 672,655 2,409,933
Group and Company 2023 2024 2025 2026-2029 Total
As at 31 December 2023 £ £ £ £ £
PO3 671,465 437,931 437,931 823,254 2,370,581
(1) Customer risk category definitions: 1 - High, 2 - Moderately High, 3 -
Moderate, 4 - Moderately Low, and 5 - Low.
11. Impairment
The Group has two types of financial asset that are subject to potential
impairment, these are contract assets relating to technology licencing
contracts and also trade receivables. At a Company level intercompany balances
are assessed for any ECL on outstanding receivables arising during the normal
course of business between the Parent and its subsidiaries.
The Group have concluded that trade receivables and contract assets have
different risk characteristics and therefore the Expected Credit Loss (ECL)
rates for each type of asset are measured separately. Since they comprise a
portfolio of only a small number of clients, contract assets have been
assessed on a client-by-client basis, whilst trade receivables have been
grouped based on shared credit risk characteristics and the days past due.
Further details on both methodologies can be found below.
IFRS 9 provisioning is applied to technology licensing contract assets based
on management estimates of the recoverability of contracts over their useful
life, and which are re-assessed at each renewal and also at each year-end.
The Group applies the IFRS 9 simplified approach to measuring expected credit
losses which uses a lifetime expected loss allowance for trade receivables and
contract assets and therefore the ECL for each contract is assessed on a
lifetime basis rather than at each reporting date. As the simplified approach
is adopted it is not necessary to consider the impact of a significant
increase in credit risk.
Group Company
Contract Assets Trade Receivables Contract Assets Trade Receivables
£ £ £ £
Reconciliation of opening to closing loss allowances 2024
Opening Impairment Provision at 1 January 2,363,501 103,503 2,363,501 58,108
Impairment charge / (credit)
ECL on new contract assets 2,822,950 - 2,822,950 -
ECL increased over time 862,376 702,437 862,376 601,598
Net ECL movement 3,685,326 702,437 3,685,326 601,598
Foreign exchange on ECL balances 12,590 - 12,590 -
Total amounts recognised through profit or loss 3,697,916 702,437 3,697,916 601,598
Written-off financial assets - (28,053) - -
Closing Impairment Provision at 31 December 6,061,417 777,887 6,061,417 659,706
Group Company
Contract Assets Trade Receivables Contract Assets Trade Receivables
£ £ £ £
Reconciliation of opening to closing loss allowances 2023
Opening Impairment Provision at 1 January 1,347,278 58,953 1,347,278 -
Impairment charge / (credit)
ECL on new contract assets 1,729,154 - 1,729,154 -
ECL increased / (reversed) over time (712,931) 79,395 (712,931) 59,608
Net ECL movement 1,016,223 79,395 1,016,223 59,608
Foreign exchange on ECL balances - - - -
Total amounts recognised through profit or loss 1,016,223 79,395 1,016,223 59,608
Written-off financial assets - (34,845) - (1,500)
Closing Impairment Provision at 31 December 2,363,501 103,503 2,363,501 58,108
Technology Licencing Contracts
During contract negotiation Aquis assesses the potential credit risk of a
prospective client prior to committing to the contract, and the Directors
consider factors that are specific to the customer, general economic
conditions and an assessment of both the current as well as the forecast
direction of these conditions. Based on this assessment, the prospective
customer is assigned to a customer category with an appropriate risk rating.
A probability of default (PD) occurring during the lifetime of the contract
ranging from 0-100% is applied to each client based on the assigned risk
category. The credit risk of Aquis' technology clients ranges from those that
are in infant start up stages (i.e. riskier) to those that are highly liquid
and solvent conglomerates (little to no risk). As such, the Directors view the
range of PDs for the portfolio to be between 100% for those with the highest
level of risk to 0% for those that are so near to a zero level of risk that
the PD is zero in substance. The Directors are comfortable that the assigned
PD is sufficiently accurate to reflect the elevated risk associated with each
start up when considering the idiosyncratic circumstances and risk factors of
each client. The portfolio of technology contracts held by Aquis have PDs that
have an observable relationship with time, i.e. the PD will decrease each year
as the contract progresses. The credit risk of the contracts is directly
linked to the success of the business and its ability to raise capital, and
each year as the business continues in operation the credit risk decreases.
The Loss Given Default (LGD) is also quantified on a customer-by-customer
basis and is done through an assessment of the recovery rate the Directors
anticipate will be applied to the customer in the event of liquidation.
Currently the low number of technology clients allows Aquis to assess each
contract individually on the appropriate credit risk category, and this is
determined based on several factors including company specific factors and
also any future macro- economic changes, the sensitivity to these potential
changes and the impact that these may have on the recoverability of the
outstanding debt.
Although the full risk assessment is completed only at the start of the
contract, the Directors assess each contract at the balance sheet date to
determine whether the level of ECL provision, based on LGD and PD at contract
inception, remains appropriate. The Directors consider a variety of factors
specific to each customer, such as past payment history, but also assess the
intent and ability to settle contractual commitments over the remaining
contractual term, examples of which include but are not limited to,
availability and sources of funding, revenue generating activities and
profitability, and ongoing communications with the customer. Further factors
considered by the Directors throughout the contract term are included within
Note 4 under critical accounting estimates.
The Contract Asset Impairment provision as at 31 December 2024 is £6,061k
(2023: £2,364k) and has been calculated with reference to estimations based
on the PD and LGD as described above for each individual contract taking into
account the nature, amount, customer categorisation, contract duration and
uncertainty of revenue and cash flows. The increase in the Contract Asset
Provision includes specific provisions made against two technology customers
totalling £3,039k to reflect a heightened risk of default. A further £611k
of provisions were recognised against these two customers but against trade
receivable balances. The total increase in provisions recognised against these
customers was equivalent to £3,650k across both Contract Assets and Trade
Receivables. £200k of impairment was also made against a new contract asset
recognised in the year.
The contracts are short-to-medium term in length and, as at 31 December 2024,
the average contract duration for the portfolio of technology contracts is 3.6
years. (2023: 3.4 years).
Intercompany receivables
In line with IFRS 9 the Company has considered the qualitative and
quantitative characteristics of the risk of default by its subsidiaries on
outstanding receivables. These are considered non-material, both in quantum
and in nature given regular settlement of balances and sufficient liquidity in
both subsidiaries to cover amounts due to the Parent.
Trade Receivables
The Group has applied a simplified Expected Credit Loss ("ECL") model on trade
receivables where a risk of potential non-payment may arise. In doing so the
Group has considered the probability of a default occurring over the
contractual life of the financial asset on initial recognition of the asset.
Trade receivables are measured at amortised cost and the calculated ECL
provision is deducted from the gross carrying amount of the assets. When a
trade receivable is determined to be uncollectible, it is written off against
the provision account for trade receivables.
The simplified provision matrix presented below is based on historic default
rates over the expected life of the trade receivables and is adjusted where
appropriate for forward-looking estimates. The trade receivables balance is
split into 8 separate categories depending on the age of each debt, ranging
from 0 days past due to over 180 days past due. An appropriate estimation of
the probability of default is applied to each category of debt, based on both
historical default rates and expectations for the future.
All AQSE customers are assessed within a single credit risk category. In
determining that the value of any potential AQXE and AQEU provision is
immaterial the Directors have separated AQXE and AQEU customers into three
distinct risk categories based on homogeneous characteristics for each
customer class. The factors used to differentiate each credit risk category in
AQXE and AQEU are primarily based on the liquidity pools of each customer
class, payment history and profiles, in addition to regulated status. The
assessment of AQXE and AQEU provisions as immaterial excludes specific
provisions for technology asset trade receivables of £659,796 (2023:
£58,108). This includes £611,131 of provisions booked against the two
Technology Licence customers for which impairment provisions of £3,039,000
were recognised against Contract Asset Balances.
Alongside AQSE provisions the total Group Provision at the year end was
£751,947 (2023: £103,503).
The key assumptions in calculating the ECL for trade receivables are that the
probability of default increases with the age of the debt and that the debts
are homogeneous, i.e. the credit risk assessment is based on age rather than
by individual client. The expected loss rates are based on historical credit
losses experienced and adjusted to reflect current and forward-looking
information. AQSE trade receivables have been assessed to have a higher risk
of impairment than the rest of the Group's trade receivables.
Trade receivables have payment terms of 30 days from the date of billing. For
debts older than 180 days, debts are assessed on a case-by-case basis and are
written off if there is no reasonable expectation of recovery. During the year
a total of £28,053 (2023: £33,345) of trade receivables were written off
relating to debts from companies that had ceased membership with AQSE and the
contractual rights to cash flows from the financial assets were deemed to have
expired.
The total loss allowance is calculated by applying the expected loss rate to
the trade receivables balance in each age bucket. The total portion of the ECL
balance relating to trade receivables as at 31 December 2023 was £409,585, of
which £92,241 related to AQSE balances (31 December 2023: £45,395). The
table below shows the allocation of provisions against AQSE Trade Receivables:
Group - 2024
Days past Due 0 1-2 30-5 60-89 90-124 125 - 149 150-17 Over 180 Total
Expected loss rate 0.5% 1.0% 3.0% 5.0% 10.0% 25.0% 50.0% 100%
Trade receivables 1,611,041 860,074 296,612 407,575 186,332 174,780 194,234 148,349 3,878,997
Expected loss (865) (975) (1,318) (9,008) (1,254) (275) (660) (79,015) (93,370)
Specific provisions (58,684) (121,200) (100,200) (105,636) (92,280) (97,320) (95,102) (14,095) (684,517)
Total Expected Credit Losses (59,549) (122,175) (101,518) (114,644) (93,534) (97,595) (95,762) (93,110) (777,887)
Group - 2023
Days past Due 0 1-29 30-59 60-89 90-124 125 - 149 150-179 Over 180 Total
Expected loss rate 0.5% 1% 3% 5% 10% 25% 50% 100%
Trade receivables 1,672,343 473,581 606,221 151,123 118,799 17,303 18,500 79,073 3,136,943
Expected loss (564) (598) (6,891) (1,411) (6,683) (1,125) (3,300) (6,585) (27,254)
Specific provisions (14,400) - (32,120) (14,400) (509) - - (14,820) (76,249)
Total Expected Credit Losses (14,964) (598) (39,011) (15,811) (7,192) (1,125) (3,300) (21,502) (103,503)
12. Operating expenses, depreciation, amortisation, finance costs, and other gains and losses
Earnings before interest, taxation, depreciation and amortisation is stated
after charging:
Group Company
2024 2023 2024 2023
£ £ £ £
Other (losses)/gains
Fair value movements in Derivative Instruments (54,626) 51,407 (54,626) 51,407
Loss on disposal of right of use assets (83,811) - (83,811) -
(138,437) 51,407 (138,437) 51,407
Other gains relate to fair value movements on derivative financial assets used
to mitigate foreign currency risk. Please see Note 5, Financial Risk
Management, for further details.
Group Company
2024 2023 2024 2023
£ £ £ £
Administrative Expenses
Fees payable to the company's auditor for the audit of the company's financial 286,500 270,000 216,500 205,000
statements
Fees payable to the company's auditor for the Client Asset audit 11,000 10,700 11,000 10,700
Share-based payments 1,342,994 1,085,658 1,342,994 1,085,658
Exchange (gain)/loss (174,769) 104,162 3,437 146,103
Employee costs 10,178,190 9,132,899 7,202,821 6,476,801
Operating costs 5,440,855 5,793,059 4,690,066 5,317,912
Net intercompany income - - (7,444,149) (6,368,051)
17,084,770 16,396,478 6,022,669 6,874,123
Other administrative expenses comprise marketing fees, data centre and other
service fees incurred in the ordinary course of business.
The Group expends resources to build trading platforms for its own use and for
licencing to customers. Research and development costs that are not eligible
for capitalisation have been expensed in the period incurred and are
recognised in administrative expenses. In 2024 the amount recognised in the
income statement was £821,080 (2023: £512,543).
Profit before taxation is stated after charging:
Group Company
2024 2023 2024 2023
£ £ £ £
Depreciation, amortisation and finance costs
Depreciation of property, plant and equipment 832,284 760,308 762,279 687,019
Amortisation of intangible assets 828,714 612,257 828,714 612,257
1,660,998 1,372,565 1,590,993 1,299,276
Group Company
2024 2023 2024 2023
£ £ £ £
Finance expense on lease liabilities (Note 28) 84,256 103,249 71,705 88,571
Finance income on lease assets (Note 28) (92,605) (15,737) (92,160) (15,293)
Interest income on deposited funds (608,818) (384,712) (208,701) (112,154)
(701,423) (400,449) (300,861) (127,447)
Total expenses were as follows:
Group Company
2024 2023 2024 2023
£ £ £ £
Total expenses 18,128,601 17,471,843 7,384,506 8,134,523
13. Exceptional Recommended Offer Costs
During the year the following costs were incurred by the Group to prepare
shareholders and other relevant stakeholders for the Rule 2.7 Announcement
under the Takeover Code, as was recommended by the Directors Aquis exchange
and accepted by shareholders by a majority vote on 20 December 2024.
These costs, labelled as 'Recommended Offer' costs in this Annual Report and
Accounts, have been classified as exceptional due to the one-off nature which
affects an understanding of the Group's underlying performance and business
activities across multiple years.
Group and Company
2024 2023
£ £
Exceptional Recommended Offer costs
Staff costs 536,722 -
Other operating expenses 2,807,141 -
3,343,863 -
Staff Recommended Offer costs include retention-based remuneration paid to all
employees and time-based compensation for key personnel in supporting the Rule
2.7 Announcement.
Other expenditure includes legal and professional fees incurred for advice
provided to the firm. Such costs incurred to date do not include
completion-based fees which would be payable on successful completion of the
deal.
Please refer to Note 2 for information about the classification of costs as
exceptional.
14. Share-based payments
Aquis Exchange PLC has five different share schemes which have been set up
since incorporation.
Aquis Exchange PLC has established two Trusts (see Note 22) to which it has
provided funding to allow the purchase of shares for future settlement of the
liability arising from the share awards noted below.
The Fair Value of any awards made in the year is calculated and recognised
through the P&L over the appropriate period as set out in the detail on
each scheme below. The total costs recognised through the P&L in the Group
in 2024 was £1,343k (2023: £1,086k).
Group and Company
2024 2023
£ £
Enterprise Management Incentives (EMI) scheme - 11,479
Restricted Share Plan (RSP) scheme 412,369 540,304
Company Share Ownership Plan (CSOP) scheme 52,387 57,963
Premium Priced Option (PPO) scheme 673,268 299,643
Share Incentive Plan (SIP) scheme 204,970 176,269
1,342,994 1,085,658
The aggregate level of share options and shares awarded which existed at the
year end is 4,707,739 shares (2023: 3,526,785 shares).
Group and Company
2024 2023
Enterprise Management Incentives (EMI) scheme 809,961 899,378
Restricted Share Plan (RSP) scheme 461,943 416,572
Company Share Ownership Plan (CSOP) scheme 256,796 203,530
Premium Priced Option (PPO) scheme 2,859,017 1,745,443
Share Incentive Plan (SIP) scheme 320,022 261,862
4,707,739 3,526,785
Enterprise Management Incentive Plan
There is one approved EMI scheme, which was initiated in June 2018 when the
first 564,124 options were granted. In April 2020 the second allotment
(approved in and deferred from November 2019 because Aquis was in a close
period) was made with a total of 740,250 options being granted. Options vest
in 3 equal tranches, one, two and three years after grant. The options expire
after 10 years.
The Group has estimated the fair value of options using a US binomial option
valuation model and spread the estimated value against the profit and loss
account over the life of the vesting period.
Of the total number of options granted, 85,750 (2022: 7,333) were exercised,
none (2022: Nil) expired and none (2023: none) were forfeited during 2024.
The share price on the grant date was £2.69 and each option can be exercised
at £2.69 to be settled in cash. The weighted average remaining contractual
life of options outstanding at the end of the reporting period amounted to nil
months (2023: nil).
The US binomial model with an average expiry duration of 5 years, volatility
of 24% and risk-free interest rate of 1.1067% was used to calculate the fair
value of the options granted on 14 June 2018. All options are exercisable at a
price of £2.69 and the weighted average expected life of the options was
estimated to be 5 years.
For options granted on 16 April 2020 the share price on the grant date was
£3.47 and each option can be exercised at £3.47 to be settled in cash. The
weighted average remaining contractual life of options outstanding at the end
of the reporting period amounted to nil (2023: 3.5 months).
The US binomial model using an average expiry duration of 5 years, volatility
of 20% and risk-free interest rate of 0.16% was used to calculate the fair
value of the options granted on 16 April 2020. All options are exercisable at
a price of £3.47 and the weighted average remaining expected life of the
options was estimated to be 5 years.
Details of the EMI scheme are as follows:
2024 2023
Number of Weighted average exercise price (£) Number of Weighted average exercise Price (£)
Shares Shares
• Outstanding at the beginning of the period 895,711 3.29 903,044 3.30
• Exercised (85,750) 1 (#_ftn1) 3.47 (7,333) 2 (#_ftn2) 3.47
• Outstanding at the end of the period 809,961 3.28 895,711 3.29
• Exercisable at the end of the period 809,961 3.28 895,711 3.29
Restricted Share Plan
The Group implemented a Restricted Share Plan (RSP) senior executive option
scheme in 2020. Total grants were made in April 2024 of 85,958 at a grant
price of £4.17 (April 2023: 70,637 options at a grant price of £4.01).
Options vest three years after grant, with an additional hold period of a
further 2 years for executive directors and expire after 10 years.
The Black-Scholes model with an average expiry duration of 3 years, volatility
of 21% and risk-free interest rate of 1.669% was used to calculate the fair
value of the options granted in April 2022.
The Black-Scholes model with an average expiry duration of 3 years, volatility
of 21% and risk-free interest rate of 1.891% was used to calculate the fair
value of the options granted in September 2022. The weighted average remaining
contractual life of options outstanding at the end of the reporting period
amounted to 7 years and 7 months (2022: 7 years and 0 months).
For options granted on 26 April 2023 the share price at the date of grant was
£4.03 and each option can be exercised at £0.10. The following inputs were
used in the Black Scholes model: average maturity of 3 years, volatility of
23% and risk-free interest rate of 3.585%.
For options granted on 26 April 2024 the share price at the date of grant was
£4.17 and each option can be exercised at £0.10. The following inputs were
used in the Black Scholes model: average maturity of 3 years, volatility of
22.46% and risk-free interest rate of 4.185%. The fair value of the award was
£329,599.
Details of the RSP scheme are as follows:
2024 2023
Number of Weighted average exercise price (£) Number of Weighted average exercise Price (£)
Shares Shares
• Outstanding at the beginning of the period 407,496 4.71 341,364 4.85
• Granted during the period 85,958 4.17 70,637 4.01
• Forfeited during the period (15,831) 4.44 (4,505) 4.03
• Exercised during the period (8,553) 3 (#_ftn3) 3.80 - -
• Expired during the period (7,127) 3.80 - -
• Outstanding at the end of the period 461,943 4.65 407,496 4.71
• Exercisable at the end of the period 207,709 4.95 137,706 3.64
Company Share Ownership Plan
The Group implemented a Company Share Ownership Plan (CSOP) employee option
scheme in 2021. 62,942 options were granted in April 2024 and the share price
at the date of grant was £4.17 each option can be exercised at £4.17 (April
2023: 64,322 options with a share price of £4.10 at the date of grant and can
be exercised at £4.10).
Options vest three years after grant and expire after 10 years.
The Black-Scholes model with an average expiry duration of 5 years, volatility
of 21% and risk-free interest rate of 1.669% was used to calculate the fair
value of the options granted in April 2022. The weighted average remaining
contractual life of options outstanding at the end of the reporting period
amounted to 8 years and 1 months (2021: 7 years and 8 months).
The share price for the options granted on 26 April 2023 was £4.10 and each
option can be exercised at £4.10. The following inputs were used in the Black
Scholes model: average maturity of 3 years, volatility of 23% and risk-free
interest rate of 3.585%.
The share price for the options granted on 26 April 2024 was £4.17 and each
option can be exercised at £4.17. The following inputs were used in the Black
Scholes model: average maturity of 3 years, volatility of 22.46% and risk-free
interest rate of 4.185%. The fair value of the award was £45,636.
Details of the CSOP scheme are as follows:
2024 2023
Number of Weighted average exercise price (£) Number of Weighted average exercise Price (£)
Shares Shares
• Outstanding at the beginning of the period 205,079 5.46 162,040 5.95
• Granted during the period 62,942 4.17 64,322 4.10
• Forfeited during the period (11,225) 4.57 (21,283) 5.10
• Exercised during the period - - - -
• Expired during the period - - - -
• Outstanding at the end of the period 256,796 5.18 205,079 5.46
• Exercisable at the end of the period 81,266 6.85 - -
Premium Priced Option Plan
The Group implemented a Premium Priced Option (PPO) option scheme in 2022
primarily focussed on Senior Executives. Grants in April 2024 were made
amounting to 1,271,381 options at a grant price of £3.84 (April 2023:
1,138,512 at a grant price of £5.04).
Options vest 3 years after grant and expire after 7 years.
The Black-Scholes model with an average expiry duration of 5 years, volatility
of 22.5% and risk-free interest rate of 1.5% was used to calculate the fair
value of the options granted in June 2022. The weighted average remaining
contractual life of options outstanding at the end of the reporting period
amounted to 5 years and 6 months (2022: 6 years and 6 months).
For options granted on June 2022 the share price at the date of grant was
£3.828 and each option can be exercised at £4.785. The following inputs were
used in the Black Scholes model: average maturity of 5 years, volatility of
22.5% and risk-free interest rate of 1.79%.
The issue price for the options granted on 26 April 2023 is £4.03 per share
to be settled in cash at the date of exercise at £5.0375. The following
inputs were used in the Black Scholes model: average maturity of 5 years,
volatility of 22.5% and risk-free interest rate of 3.723%.
The market value on the date of grant on 26 April 2024 was £4.28 and each
option can be exerised at £4.80. The following inputs were used in the Black
Scholes model: average maturity of 5 years, volatility of 22.46% and risk-free
interest rate of 4.185%. The fair value of the award was £1,292,994.
Details of the PPO scheme are as follows:
2024 2023
Number of Weighted average exercise price (£) Number of Weighted average exercise Price (£)
Shares Shares
• Outstanding at the beginning of the period 1,692,933 4.95 554,421 4.79
• Granted during the period 1,271,381 3.84 1,138,512 5.04
• Forfeited during the period (105,297) 5.04 - -
• Exercised during the period - - - -
• Expired during the period - - - -
• Outstanding at the end of the period 2,859,017 4.46 1,692,933 4.95
• Exercisable at the end of the period - - - -
Share Incentive Plan
The employee Share Incentive Plan ("SIP") is administered by Equiniti ("the
Trust"). The Trust purchases shares in Aquis on the open market on behalf of
employees that have elected to take part. Employees are limited to a maximum
annual contribution of £1,800. The scheme allows employees to become
shareholders in the Company in a tax efficient manner, with the Company
purchasing two matching shares for every partnership purchased by the
employee. The terms of the matching shares include that they must be held by
the Trust for three years before they can be transferred or sold, and the
employee must remain employed with the Company throughout this period. Free
shares are also awarded to staff on an annual basis where performance criteria
are met, with the Company purchasing up to a further 2 shares for each
partnership share purchased.
The fair value of the matching and free shares purchased by the company are
expensed over the three year vesting period. Management assumes that the cost
of the shares is a close approximation of the fair value of the shares as the
market price tends to be reflective of the discounted value of research
analysts' medium-term projections.
The fair value of awards in the year was £204,970 (2023: £176,269).
Details of the SIP scheme are as follows:
2024 2023
Number of Shares Number of Shares
• Shares held at the beginning of the period 261,862 186,155
• Partnership shares purchased in the period 15,313 16,863
• Matching shares purchased during the period 30,626 33,726
• Free shares purchased during the period 18,739 35,673
• Exercised during the period (5,806) (2,607)
• Forfeited during the period (618) (7,948)
• Shares held at the end of the period 320,116 261,862
• Exercisable at the end of the period - -
15. Deferred tax asset
A net deferred tax asset of £1,785,331 (2023: £1,785,331) at the Group and
£1,506,022 (2023: £1,506,022 at the Company) relating to unused tax losses
has been recognised in the current period. The losses are considered able to
offset against the Company's taxable profits expected to arise in the next
three accounting periods. This comprises a gross Deferred Tax Asset of
£1,925,809 (2023: £1,884,349) at the Group and £1,646,500 (2023:
£1,605,040 at the Company) offset by a Deferred Tax Liability of £140,478
(2023: £99,018) at the group and Company arising in the Company on the timing
difference on accounting depreciation versus tax written down value charge.
The assessment of future taxable profits involves a significant degree of
estimation, which management have based on the latest budget for the Company
approved by the Board which reflects the improvement trading performance
largely due to the continued expansion of the business as discussed in the
Strategic Report. The preparation of the budget involves a rigorous review
process by the Board, whereby each revenue stream and cost is scrutinised and
challenged in detail so that the final version is considered to be an accurate
and plausible representation of what is likely to be achieved in the period.
In calculating the deferred tax asset, Management have applied a conservative
approach by using probability adjusted revenues, applying lower probabilities
to budgeted revenue from more uncertain sources such as large technology
licencing contracts, with the effect of reducing estimated profits over the
3-year period from the original forecasts. The analysis predicts profitability
is still achievable even when revenues are reduced to reflect this adjustment.
The net deferred tax balance comprises temporary differences attributable to:
Group 2024 2023
£ £
Tax losses 1,925,809 1,884,349
Fixed asset timing differences (140,478) (99,018)
Total deferred tax asset 1,785,331 1,785,331
Company 2024 2023
£ £
Tax losses 1,646,500 1,605,040
Fixed asset timing differences (140,478) (99,018)
Total deferred tax asset 1,506,022 1,506,022
Movement in deferred tax balance:
Group 2024 2023
£ £
At 1 January 1,785,331 1,593,931
Origination and reversal of timing differences (312,668) 270,485
Adjustment in respect of prior periods 312,668 (79,085)
At 31 December 1,785,331 1,785,331
Company 2024 2023
£ £
At 1 January 1,506,022 1,456,184
Origination and reversal of timing differences (312,668) 122,556
Adjustment in respect of prior periods 312,668 (72,718)
At 31 December 1,506,022 1,506,022
Deferred tax assets are recognised only to the extent that there are
sufficient probable future taxable profits available to set against deductible
temporary differences and carry forward tax losses (and R&D credits). As
at 31 December 2024 the Group and Company have not recognised deferred tax
assets of £9,252,253 and £1,101,553 respectively (31 December 2023:
£9,419,710 and £951,421) based on an assumed future tax rate of 25%. All tax
losses in the Group do not have an expiry date.
The Group has combined losses of £44,150,335 (2023: £44,670,056) available
for carry forward and to be used against future trading profits of the same
trade in which they were generated. This is comprised of trading generated in
the UK by Aquis Exchange PLC and Aquis Stock Exchange Limited. There are no
losses carried forward in France within Aquis Exchange Europe SAS.
The Company has estimated losses of £10,430,300 (2023: £10,696,732)
available for carry forward against future trading profits.
16. Income tax
Group Company
2024 2023 2024 2023
£ £ £ £
Current Tax
UK Corporation tax charge - - - -
Overseas tax charges on foreign operations 235,291 183,611 - -
Total current tax charge 235,291 183,611 - -
Deferred Tax
Origination and reversal of timing 312,668 (270,485) 312,668 (122,556)
differences (Note 15)
Adjustment in respect of prior periods (312,668) 79,085 (312,668) 72,719
Net income tax charge / (credit) 235,291 (7,789) - (49,837)
Reconciliation of expected tax charge / (credit) to (losses) / profits before
tax:
Group Company
2024 2023 2024 2023
£ £ £ £
(Loss) / Profit for the year before taxation (2,226,649) 5,194,887 (3,448,569) 3,988,392
Expected tax charge based on a corporation tax rate of 25% (2023: 23.5%) (792,517) 1,039,094 (862,142) 938,092
Expected tax charge based at effective overseas rates of 25.46% (2023: 25%) 230,244 182,100 - -
Charge on disposal of right of use assets 21,941 (57) 21,941 (57)
Expenses not deductible for tax purposes 920,833 218,923 915,040 218,705
Adjustments in respect of prior periods (312,668) - (312,668) -
Other differences - 857 - (654)
Remeasurement of deferred tax for changes in tax rates - 79,085 - 72,718
Movement in deferred tax not recognised 167,458 (1,527,791) 237,829 (1,278,641)
Tax charge / (credit) for the period 235,291 (7,789) - (49,837)
17. Earnings per share
Group Company
2024 2023 2024 2023
Number of Shares
Weighted average number of ordinary shares for basic earnings per share 26,302,830 26,602,167 27,564,630 27,516,188
Weighted average number of ordinary shares for diluted earnings per share 27,113,586 27,491,871 28,375,386 28,405,822
Earnings
(Loss) / Profit for the year from continued operations (2,461,940) 5,202,676 (3,448,569) 4,038,229
Basic and diluted earnings per share (pence)
Basic earnings per ordinary share (9) 19 (13) 15
Diluted earnings per ordinary share (9) 19 (12) 14
Basic earnings per share is in respect of all activities of the Group and
diluted earnings per share takes into account the dilution effects which would
arise on conversion or vesting of all outstanding share options and share
awards under the Enterprise Management Incentive (EMI) scheme.
18. Intangible assets
Group and Company Developed Total Intangible
trading platforms Other Intangibles Assets Group Goodwill
Cost
As at 1 January 2023 3,617,083 209,296 3,826,379 83,481
Additions 1,034,168 47,750 1,081,918 -
As at 31 December 2023 4,651,251 257,046 4,908,297 83,481
Additions 1,728,053 16,300 1,744,353 -
As at 31 December 2024 6,379,304 273,346 6,652,650 83,481
Accumulated amortisation and impairment
As at 1 January 2023 2,772,195 21,960 2,794,155 -
Charge for the year 559,741 52,516 612,257 -
As at 31 December 2023 3,331,936 74,476 3,406,412 -
Charge for the year 771,175 57,539 828,714 -
As at 31 December 2024 4,103,111 132,015 4,235,126 -
Carrying amount
As at 31 December 2024 2,276,193 141,331 2,417,524 83,481
As at 31 December 2023 1,319,315 182,570 1,501,885 83,481
All intangible assets within the Group are held by the Company.
Other intangible assets include assets valued at £68,835 (2023: £68,835)
with indefinite useful economic lives. Further information on these assets can
be found in Note 2 under the heading "Intangible assets other than Goodwill."
Goodwill
On 11 March 2020 the Group acquired Aquis Stock Exchange Limited (formerly NEX
Exchange Limited) which resulted in recognition of goodwill of £83,481. The
cash generating unit associated with the goodwill is determined to be the
assets associated with the investment in AQSE.
The goodwill arising on consolidation represents the growth potential of the
primary listings exchange and the synergies with the rest of the business.
AQSE has no intangible assets.
Impairment tests for goodwill
Goodwill has been allocated for impairment testing purposes to a cash
generating unit, being the net assets related to Aquis Stock Exchange.
The recoverable amounts of the cash generating unit has been determined based
on a value-in-use calculation using discounted cash flow forecasts based on
business plans prepared by management for a three-year period ending 31
December 2028. The two key estimates used in this model were an estimated
terminal growth rate of 2%, and a pre-tax discount factor of 12%.
The results of the testing indicated the projected value of Aquis Stock
Exchange to exceed its carrying value. As a result no impairment loss has been
recognised in the current year.
19. Property, plant and equipment
Group Fixtures, fittings and equipment Computer Equipment Right of Use Assets Total
Cost
As at 1 January 2023 491,901 2,991,233 4,224,587 7,707,721
Additions 9,379 401,937 12,618 423,934
Foreign Currency Translation Differences - - 14,172 14,172
As at 31 December 2023 501,280 3,393,170 4,251,377 8,145,827
Additions (and lease adjustments) 4,549 383,380 - 387,929
Disposals - (10,909) (113,003) (123,912)
As at 31 December 2024 505,829 3,765,641 4,138,374 8,409,844
Accumulated amortisation and impairment
As at 1 January 2023 295,266 2,373,110 905,761 3,574,137
Charge for the year 50,731 325,755 383,822 760,308
Foreign Currency Translation Differences - - (7,459) (7,459)
As at 31 December 2023 345,997 2,698,865 1,282,124 4,326,986
Charge for the year 51,204 397,667 383,413 832,284
Disposals - (10,909) (29,192) (40,101)
As at 31 December 2024 397,201 3,085,623 1,636,345 5,119,169
Carrying amount
As at 31 December 2024 108,628 680,018 2,502,029 3,290,675
As at 31 December 2023 155,283 694,305 2,969,253 3,818,841
Company Fixtures, fittings and equipment Computer Equipment Right of Use Assets Total
Cost
As at 1 January 2023 477,130 2,984,386 3,656,087 7,117,603
Additions 9,379 400,352 - 409,731
As at 31 December 2023 486,509 3,384,738 3,656,087 7,527,334
Additions 4,549 383,380 - 387,929
Disposal - (10,909) (113,003) (123,912)
As at 31 December 2024 491,058 3,757,209 3,543,084 7,791,351
Accumulated amortisation and impairment
As at 1 January 2023 292,775 2,371,063 825,684 3,489,522
Charge for the year 47,782 323,341 315,896 687,019
As at 31 December 2023 340,557 2,694,404 1,141,580 4,176,541
Charge for the year 48,337 396,362 317,580 762,279
Disposal - (10,909) (29,192) (40,101)
As at 31 December 2024 388,894 3,079,857 1,429,968 4,898,719
Carrying amount
As at 31 December 2024 102,164 677,352 2,113,116 2,892,632
As at 31 December 2023 145,952 690,334 2,514,507 3,350,793
20. Investment in subsidiaries
Company 2024 2023
£ £
Investment in subsidiaries 6,884,202 6,884,202
Details of the Company's subsidiaries are set out in the following table. The
investments are measured using the equity method in Aquis Exchange PLC's
standalone accounts.
Name of undertaking Country of Ownership interest (%) Voting Nature of Carrying Carrying
incorporation power held (%) business amount 2024 amount 2023
Aquis Stock Exchange UK 100 100 Recognised Investment Exchange 3,677,118 3,677,118
Aquis Exchange Europe SAS France 100 100 European Equities Exchange 3,207,084 3,207,084
6,884,202 6,884,202
The registered office of Aquis Exchange Europe SAS is 231 rue Saint Honoré,
75001 Paris, France. The registered office of Aquis Stock Exchange Limited is
63 Queen Victoria Street, EC4N 4UA,UK.
Both investments were assessed for impairment at year end and no indicators of
impairment were noted, with both Aquis Stock Exchange and Aquis Exchange
Europe SAS profitable in both 2024 and 2023. Therefore, in line with IAS 36
guidance, no impairment provision has been recognised in Aquis Exchange PLC's
financial statements.
There has been no change in the year of the carrying value of any subsidiary
(2023: no change).
21. Investments in financial assets
Group and Company 2024 2023
£ £
Financial assets measured at fair value through OCI 1,176,021 591,945
In August 2023 Aquis Exchange PLC acquired a 5.2% stake in OptimX LLC for
consideration of USD 750k. The entity is currently in the development stage of
creating blotter scraping technologies. The shares of OptimX LLC are not
listed on any public market. A further investment of USD 750k was made in July
2024 bringing the Company's stake to 10.2%.
The fair value of OptimX, an unlisted-equity investment falls within Level 3
of the IFRS 13 Fair Value hierarchy, see Note 24 for further details on
valuation of the investment.
22. Investment in Trusts
The table below shows the total amount the Company has invested in the two
Trusts in respect of the share based payments arising under (i) the Employee
Share Incentive Plan and (ii) the Restricted Share Plan, Company Share
Ownership Plan and Premium Price Options plan as at the reporting date.
Investments into the Trusts are mostly comprised of cash contributions made to
acquire Company shares. Deductions from the Trusts represent vested shares
withdrawn.
Company 2024 2023
£ £
Investment in Trusts 5,702,768 4,389,445
23. Trade and other receivables
Current Non-current Total
2024 2023 2024 2023 2024 2023
Group £ £ £ £ £ £
Trade receivables 3,101,110 3,033,440 - - 3,101,110 3,033,440
Technology licence contract assets 3,087,708 3,029,766 3,158,605 5,450,678 6,246,313 8,480,444
Other receivables 302,379 107,183 10,762 360,411 313,141 467,594
Prepayments 1,162,752 724,547 - - 1,162,752 724,547
7,653,949 6,894,936 3,169,367 5,811,089 10,823,316 12,706,025
Current Non-current Total
2024 2023 2024 2023 2024 2023
Company £ £ £ £ £ £
Trade receivables 2,717,502 2,538,127 - - 2,717,502 2,538,127
Technology licence contract assets 3,087,708 3,029,766 3,158,605 5,450,678 6,246,313 8,480,444
Other receivables 270,550 44,970 - 345,240 270,550 390,210
Intercompany receivables 1,251,870 471,658 - - 1,251,870 471,658
Prepayments 1,095,132 652,422 - - 1,095,132 652,422
8,422,762 6,736,943 3,158,605 5,795,918 11,581,367 12,532,861
The following details the trade receivables that are stated net of any credit
impairment provision, as set out previously in Note 11 in accordance with IFRS
9.
Group Company
2024 2023 2024 2023
Trade receivables £ £ £ £
Gross trade receivables 3,878,997 3,136,943 3,377,208 2,596,235
Expected credit loss on trade receivables (777,887) (103,503) (659,706) (58,108)
Gross contract assets 12,307,730 10,843,945 12,307,730 10,843,945
Expected credit loss on contract assets (6,061,417) (2,363,501) (6,061,417) (2,363,501)
Trade receivables net of provisions 9,347,423 11,513,884 8,963,815 11,018,571
24. Fair value measurement
Some of the Group's assets and liabilities are measured at fair value. In
estimating the fair value of an asset or liability the Group uses
market-observable data to the extent that is available.
All assets and liabilities for which fair value is measured or disclosed in
the financial statements are categorised based on the lowest level input that
is significant to the fair value measurement.
- Level 1: Quoted market prices in active markets for identical assets or
liabilities;
- Level 2: Valuation techniques for which the lowest level input that is
significant to the fair value measurement is directly or indirectly
observable; and,
- Level 3: Valuation techniques for which the lowest level input that is
significant to the fair value measurement is unobservable.
The policies and procedures for the valuation of unquoted financial assets
determined by Management are presented to the Audit Risk and Compliance
Committee at each relevant balance sheet date. The valuation of private equity
instruments are particularly sensitive to changes in one or more unobservable
inputs. Further information on the carrying amount of these assets and the
sensitivity of those amounts to changes in unobservable inputs is provided
below.
Group and Company
Level 1 Level 2 Level 3
31 December 2024 assets and (liabilities) £ £ £
Derivatives, foreign currency forward contracts - (3,219) -
Equity investments, OptimX LLC (Note 21) - - 1,176,021
- (3,219) 1,176,021
Group and Company
Level 1 Level 2 Level 3
31 December 2023 assets and (liabilities) £ £ £
Derivatives, foreign currency forward contracts - 51,407 -
Equity investments, OptimX LLC (Note 21) - - 591,945
- 51,407 591,945
Reconciliation of fair value measurements categorised within level 3 of the
fair value hierarchy:
2024 2023
£ £
Balance at 1 January 591,945 -
Acquisitions in the year 584,076 591,945
Gains and losses recognised in other comprehensive income - -
Balance at 31 December 1,176,021 591,945
No gains and losses were recognised in other comprehensive income for the year
because the fair value of the investment in OptimX LLC at 31 December 2024 is
materially consistent with the cost at acquisition.
Valuation Techniques and Inputs
Finance assets / liabilities Valuation techniques and key inputs Significant unobservable inputs Relationship and sensitivity of unobservable inputs to fair value
Investment in unlisted shares, OptimX LLC (Note 21) Income approach using the discounted cash flow method to determine the present Discount factor, determined by using a two year UK government gilt to The greater the discount factor the lower the fair value.
value of future economic benefits derived from the investment. determine a reasonable baseline for return on investment.
If the discount rate was 5% higher/lower, with all other variables remaining
constant, the carrying amount would decrease/increase by £173k / £227k.
Revenue growth rate The higher the compound growth rate the higher the fair value.
If the growth rate were to increase /decrease by 0.5%, the carrying amount
would increase/increase by £357k / £319k.
25. Cash and cash equivalents
Group Company
2024 2023 2024 2023
£ £ £ £
Cash at bank 13,699,076 14,765,910 5,745,324 6,356,259
Cash and cash equivalents comprise over night and short term deposits of less
than 3 month and are held with authorised counterparties of a high credit
standing. Management does not expect any losses from non-performance by the
counterparties holding cash and cash equivalents, and there are no material
differences between their book and fair values.
Cash held by Aquis Exchange Europe SAS is predominantly held in a Sterling
denominated bank account.
26. Provisions
Group and Company
2024 2023
Provisions for disputed data costs £ £
Balance at 1 January - -
Provisions recognised in the year 343,784 -
Balance at 31 December 343,784 -
Provisions were raised in the year to provide against disputes over amounts
due for data services received by the Group over the last few years which
would be payable to two data vendors.
There remains uncertainty as to the final settlement amount because ongoing
discussions with the vendors are yet to establish the scope of error. However,
the amounts provided represent the Directors' best estimate of the liability
based on current discourse with those entites at the date of signing these
financial statements.
Provisions recognised in the Group and Company have not been discounted
because final settlement is expected to occur within one year of the balance
sheet date.
27. Trade and other payables
Group Company
2024 2023 2024 2023
Current £ £ £ £
Trade payables 1,122,893 759,002 1,088,349 674,307
Accruals 2,082,791 1,814,407 1,623,395 1,388,911
Deferred Revenue 786,658 934,423 - -
Social security and other taxation 353,628 343,729 208,201 256,777
Intercompany payables - - 2,933,762 824,405
Other payables 169,788 58,772 163,738 84,132
Overseas corporation tax payable 55,461 33,798 - -
Short term lease liabilities 511,989 527,339 437,400 437,400
Short Term Lease Liabilities 5,083,208 4,471,470 6,454,845 3,665,932
28. Leases
Right of Use Assets
The right-of use asset was measured at the amount equal to the lease
liability, plus prepaid lease payments (being the unamortised portion of the
rent deposit asset). The right of use asset is depreciated over the term of
the lease and was accounted for during the year ended 31 December 2024 as
follows:
Group Company
£ £
Carrying amount at 1 January 2023 3,318,826 2,830,403
Remeasurement of Paris Lease 21,631 -
Foreign currency translation differences 12,618 -
Depreciation for the year (383,822) (315,896)
Carrying amount at 31 December 2023 2,969,253 2,514,507
Disposal of right of use assets (83,811) (83,811)
Depreciation for the year (383,413) (317,580)
Carrying amount at 31 December 2024 2,502,029 2,113,116
Rent deposit asset
The rent deposit asset (excluding the prepaid right of use portion which has
been included in the calculation of the right of use asset above) is a
financial asset measured at amortised cost and was accounted for during the
year ended 31 December 2024 as follows:
Group Company
£ £
Carrying amount at 1 January 2023 356,647 329,947
Recovery of rent deposit (7,619) -
Remeasurement of Paris lease (4,354) -
Finance income on rent deposit asset for the year 15,737 15,293
Carrying amount at 31 December 2023 360,411 345,240
Recovery of rent deposit asset (442,254) (437,400)
Finance income on rent deposit asset for the year 92,605 92,160
Carrying amount at 31 December 2024 10,762 -
Lease liability
The lease liability is calculated as the net present value of the fixed
payments (including in-substance fixed payments), less any lease incentives
receivable (such as any rent-free periods). The lease payments are discounted
using the interest rate implicit in the lease. The lease liability is measured
at amortised cost and was accounted for during the year ended 31 December 2024
as follows:
Group Company
£ £
Carrying amount at 1 January 2023 3,410,193 2,886,712
Foreign currency translation differences (12,516) -
Finance expense on lease liability for the year 103,249 88,571
Lease payments made during the year (516,482) (437,400)
Carrying amount at 31 December 2023 2,984,444 2,537,883
Finance expense on lease liability for the year 84,256 71,705
Lease payments made during the year (519,134) (437,400)
Carrying amount at 31 December 2024 2,549,566 2,172,188
Of which are:
Current 511,989 437,400
Non-current 2,037,577 1,734,788
2,549,566 2,172,188
The non-current and current portions of the lease liability are included in
'Lease liability' and 'Other Payables' (Trade and Other Payables) on the
Statement of Financial Position respectively.
Net finance (income) / expense on leases
Group Company
2024 2023 2024 2023
£ £ £ £
Finance expense on lease liability 84,256 103,249 71,705 88,571
Finance income on rent deposit asset (92,605) (15,737) (92,160) (15,293)
Net finance (income) / expense relating to leases (8,349) 87,512 (20,455) 73,278
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
Group Company
2024 2023 2024 2023
£ £ £ £
Depreciation expense on right-of-use assets (383,413) (383,822) (317,580) (315,896)
Finance expense on lease liability (84,256) (103,249) (71,705) (88,571)
Finance income on rent deposit asset 92,605 15,737 92,160 15,293
Short term lease expense (12,451) (43,310) - -
Loss on disposal of Right of Use Assets (83,811) - (83,811) -
Net impact of leases on profit or (loss) (471,326) (514,644) (380,936) (389,174)
The contractual terms of the Paris lease state that lease payments are indexed
which has resulted in a remeasurement of the lease liability to reflect an
uplift of future expected payments. The Company lease based in the UK is not
subject to variable rates.
29. Share capital
Group 2024 2023
£ £
Ordinary share capital
Issued and fully paid
27,516,781 (2023: 27,509,448) Ordinary shares of 10p each 2,751,678 2,750,945
Issue of 7,333 new shares of 10p each - 733
Issue of 85,750 new shares of 10p each 8,575 -
27,602,531 (2023: 27,516,781) Ordinary Shares of 10p each 2,760,253 2,751,678
30. Treasury shares
Group 2024 2023
£ £
At the beginning of the year 4,389,445 3,350,325
Purchase of additional shares 1,517,690 1,215,243
Shares vested or sold by trusts (221,157) (157,189)
Change in level of surplus cash held by trusts 16,790 (18,934)
At the end of the year 5,702,768 4,389,445
Treasury shares are held by the Employee Benefit Trusts. Further disclosures
about the value of shares acquired by the EBT can be read in note 22. The
Investment in Trust has been consolidated within the Group's results as the
parent company (Aquis Exchange PLC) can substantially direct the investment
activities of the Trusts, thus the Trusts' assets have been consolidated as
Treasury Shares.
In the year to 31 December 2024 328,861 shares with a nominal value of
£32,886 were bought at a total cost of £1,517,690 and held in Treasury
(2023: 331,179 shares with a nominal value of £33,178 were bought at a total
cost of £1,215,243 and held in Treasury).
As at 31 December 2024, 320,022 shares (2023: 261,956) were held in the
Employee Share Incentive Plan Trust, and a further 1,110,970 shares (2023:
840,175) held in the Trust relating to Restricted Share Plan, Company Share
Ownership Plan and Premium Priced Option Plan.
At 31 December 2024 £34,466, (2023: £17,676) of surplus cash was held within
the Trusts, which had yet to be used to purchase Treasury shares, but remained
under the control of the Trusts.
Group 2024 2023
£ £
Treasury Shares held 5,668,302 4,371,769
Cash Held in Employee Trusts 34,466 17,676
At the end of the year 5,702,768 4,389,445
31. Cash generated by operations
Group 2024 2023
£ £
(Loss) / Profit before tax (2,226,649) 5,194,887
Adjustments for:
Impairment charge/(credit) on contract assets 3,685,326 1,016,223
Impairment charge on trade and other receivables 702,437 44,550
Fair value adjustment to derivatives 54,626 (51,407)
Equity settled share based payment expense 1,342,994 1,085,658
Amortisation of intangible assets 828,714 612,257
Depreciation and impairment of property, plant and equipment 832,284 760,308
Loss on disposal of right of use asset 83,811 -
Increase in provisions 343,784 -
Finance expense 84,256 103,249
Finance income (92,605) (15,737)
Interest income (608,818) (384,712)
7,256,809 3,170,389
Movement in working capital:
(Increase) in trade and other receivables (2,919,643) (4,277,113)
Increase in trade and other payables 617,858 309,470
Cash generated by operations 2,728,375 4,397,633
Corporation taxes paid (203,312) (293,914)
Net cashflow from operating activities 2,525,063 4,103,719
Operating cash flows
For the year ended 31 December 2024
Company 2024 2023
£ £
(Loss) / Profit before tax (3,448,569) 3,988,392
Adjustments for:
Impairment charge/(credit) on contract assets 3,685,326 1,016,223
Impairment charge on trade and other receivables 601,598 58,108
Fair value adjustment to derivatives 54,626 (51,407)
Equity settled share based payment expense 1,342,994 1,085,658
Amortisation of intangible assets 828,714 612,257
Depreciation and impairment of property, plant and equipment 762,279 687,019
Loss on disposal of right of use asset 83,811 -
Increase in provisions 343,784 -
Finance expense 71,705 88,571
Finance income (92,160) (15,293)
Interest income (208,701) (112,154)
7,473,976 3,368,982
Movement in working capital:
(Increase)/Decrease in trade and other receivables (3,680,670) 2,309,031
Increase/(Decrease) in trade and other payables 2,788,913 (5,326,269)
Cash generated by operations 3,133,650 4,340,136
Corporation taxes paid - -
Net cashflow from operating activities 3,133,650 4,340,136
32. Related party transactions
Remuneration of key management personnel
The remuneration of the directors, who are key management personnel, is set
out below in aggregate for each of the categories specified in IAS 24 Related
Party Disclosures.
Group 2024 2023
£ £
Salaries and other short term benefits 1,190,384 1,569,531
Share based payments 421,846 490,437
Total 1,612,230 2,059,968
Company 2024 2023
£ £
Salaries and other short term benefits 1,081,821 1,123,238
Share based payments 276,519 246,592
Total 1,358,340 1,369,830
During the year the Group has entered into, in the ordinary course of
business, transactions with other related parties. All transactions between
Aquis Exchange Plc and its subsidiaries are eliminated on consolidation.
Costs incurred by the Company on behalf of its subsidiary companies are
recharged to these Companies through a Management fee and service charge,
which for 2024 represented a net recharge of £6,600k (2023: £5,678k) to
Aquis Europe SAS and a net recharge of £711k (2023: £690k) to Aquis Stock
Exchange Limited. The net cash payments in the year and balances outstanding
at the year end were:
2024 Receipts and (payments) Amounts owed Amounts owed
Company £000s from related parties to related parties
£000s £000s
Aquis Stock Exchange Ltd 3,192 170 (216)
Aquis Europe SAS (1,697) 764 (2,718)
Total 1,495 934 (2,934)
2023 Receipts and (payments) Amounts owed Amounts owed
Company £000s from related parties to related parties
£000s £000s
Aquis Stock Exchange Ltd 2,565 551 -
Aquis Europe SAS (1,385) - (904)
Total 1,180 551 (904)
33. Share premium account
Group 2024 2023
£ £
At the beginning of the year 11,809,757 11,785,045
Issue of new shares 288,977 24,712
At the end of the year 12,098,734 11,809,757
34. Other reserves
Group Company
2024 2023 2024 2023
£ £ £ £
Reserves relating to share-based payments 3,863,426 2,741,589 3,863,426 2,741,589
35. Controlling party
In the opinion of the Directors, there is no single overall controlling party.
No individual shareholder had a shareholding of 10% or above as at 31 December
2024.
36. Events occurring after the reporting period
On 17 February 2025 Alasdair Haynes informed the Board of his decision to step
back from the day-to-day running of the business for health reasons, and
assumed the role of President of the Group. Alasdair remains a Director of the
Company, acting as senior counsel to the management team.
On the same day David Stevens assumed the role of Chief Executive Officer and
was appointed as a Director of the Company.
1 (#_ftnref1) For options exercised in 2024, the share price on the date of
exercise was: 2,542 options at £3.62, 5,092 options at £3.65, 10,336 options
at £3.60, 29,000 options at £3.62, and 38,750 options at £7.05.
2 (#_ftnref2) For options exercised in 2024, the share price on the date of
exercise was: 7,333 options at £3.70.
3 (#_ftnref3) The share price on the date of exercise was £3.87.
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