REG - Craven House Capital - Interim Results
27/02/2023 15:45
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RNS Number : 1923R Craven House Capital PLC 27 February 2023
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS STIPULATED UNDER THE UK
VERSION OF THE MARKET ABUSE REGULATION NO 596/2014 WHICH IS PART OF ENGLISH
LAW BY VIRTUE OF THE EUROPEAN (WITHDRAWAL) ACT 2018, AS AMENDED. ON
PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY INFORMATION SERVICE, THIS
INFORMATION IS CONSIDERED TO BE IN THE PUBLIC DOMAIN.
Craven House Capital PLC
("Craven House" or the "Company")
Unaudited Interim Report for the period ended 30 November 2022
CRAVEN HOUSE CAPITAL PLC
CRAVEN HOUSE CAPITAL PLC
INVESTMENT MANAGER'S REPORT FOR THE SIX MONTH PERIOD ENDED
30 NOVEMBER 2022
Statement by the Investment Manager
The Company's investment portfolio comprises minority shareholdings in five
Swedish-managed businesses operating in the eCommerce and pharmaceutical
sectors. The valuations of the respective entities at the end of the period
are as follows
Investment Value at 30 Nov 2022 Value at 31 May 2022
Shares in Garimon Limited $290,000 $1,600,000
Shares in Stormfjord Limited $1,310,000 -
Shares in Rosedog Limited $1,600,000 $1,600,000
Shares in Honeydog Limited $1,600,000 $1,600,000
Shares in Bio Vitos Medical Limited $1,600,000 $1,600,000
The investee companies have each demonstrated positive progress during the
period however remain at a 'pre-revenue' stage of business development. As
previously disclosed on 15 November 2022, the onebas.com domain was
transferred out of Garimon during the period into a new entity (Stormfjord
Ltd). Stormfjord Ltd subsequently raised $520,000 of arms-length financing,
which valued the domain at $5,000,000. The proceeds of the financing were used
to upgrade the functionality and capacity of the websites as well as launch a
PR / advertising campaign across key target markets.
After the end of the period, BioVitos Ltd reported that it had entered into a
conditional agreement (the "Agreement") to undertake a reverse takeover of
Hemcheck Sweden AB, a company listed on the Nasdaq Stockholm (as announced on
8 February 2023). As part of the Agreement and subject to approval by
Hemcheck's shareholders at an EGM to be convened at a date still to be
confirmed, Hemcheck will create a new subsidiary ("NewCo") and transfer all
current business and assets of Hemcheck to this new subsidiary. Under the
terms of the Agreement, Bio Vitos has agreed to provide Hemcheck with SEK1.23
million in cash, within 14 days after the approval of the transaction by
Hemcheck's shareholders.
Bio Vitos will then pay a further SEK4 million in cash, to Hemcheck, within
thirty days following the distribution of shares in NewCo to Hemcheck
shareholders.
In addition Bio Vitos has agreed to provide Hemcheck with its IP rights
(patents or patent applications) in respect of an active substance Iron
Succinate (Succifer and used in a marketed product Inofer). In exchange, Bio
Vitos will receive 259,654,000 shares in Hemcheck, amounting to circa 88.3% of
Hemcheck's share capital.
Desmond Holdings Ltd
Investment Manager to Craven House Capital Plc
CRAVEN HOUSE CAPITAL PLC
STATEMENT OF COMPREHENSIVE INCOME
FOR THE SIX MONTH PERIOD ENDED 30 NOVEMBER 2022
Six months ended Year Ended
30 Nov 2022 30 Nov 2021 31 May 2022
Note (Unaudited) (Unaudited) (Audited)
$'000 $'000 $'000
CONTINUING OPERATIONS
Changes in fair value - - -
Administrative expenses (72) (78) (180)
OPERATING LOSS (72) (78) (180)
Interest expense - - (56)
LOSS BEFORE INCOME TAX (72) (78) (236)
Income tax 2 - - -
LOSS FOR THE PERIOD (72) (78) (236)
Earnings per share expressed
In cents per share:
Basic and diluted 5 (1.86) (2.02) (6.11)
CRAVEN HOUSE CAPITAL PLC
STATEMENT OF FINANCIAL POSITION
AS AT 30 NOVEMBER 2022
Six months ended Year Ended
30 Nov 2022 30 Nov 2021 31 May 2022
(Unaudited) (Unaudited) (Audited)
Note $'000 $'000 $'000
ASSETS
NON-CURRENT ASSETS
Investments at fair value through
profit or loss 3 6,400 6,400 6,400
6,400 6,400 6,400
CURRENT ASSETS
Trade and other receivables 32 16 43
Cash and cash equivalents 1 1 1
33 17 44
TOTAL ASSETS 6,433 6,417 6,444
EQUITY
SHAREHOLDERS' EQUITY
Called up share capital 4 3,802 3,802 3,802
Share premium 11,153 11,153 11,153
Accumulated deficit (9,896) (9,666) (9,824)
TOTAL EQUITY 5,059 5,289 5,131
LIABILITIES
CURRENT LIABILITIES
Trade and other payables 78 86 76
NON-CURRENT LIABILITIES
Other payables 1,296 1,042 1,237
TOTAL LIABILITIES 1,374 1,128 1,313
TOTAL EQUITY AND LIABILITIES 6,433 6,417 6,444
CRAVEN HOUSE CAPITAL PLC
STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTH PERIOD ENDED 30 NOVEMBER 2022
Called up share capital
$'000 Share premium Accumulated deficit
$'000 $'000 Total
$'000
Balance at 1 June
2021 3,802 11,153 (9,588) 5,367
Changes in equity
Issue of share capital - - - -
Transactions with owners 3,802 11,153 (9,588) 5,367
Loss for the period - - (78) (78)
Balance at 30 November 2021
3,802 11,153 (9,666 5,289
Changes in equity
Issue of share capital - - - -
Transactions with owners 3,802 11,153 (9,666) 5,289
Loss for the period - - (158) (158)
Balance at 31 May
2022 3,802 11,153 (9,824) 5,131
Changes in equity
Issue of share capital - - - -
Transactions with owners 3,802 11,153 (9,824) 5,131
Loss for the period - - (72) (72)
Balance at 30 November
2022 3,802 11,153 (9,896) 5,059
CRAVEN HOUSE CAPITAL PLC
STATEMENT OF CASH FLOWS
FOR THE SIX MONTH PERIOD ENDED 30 NOVEMBER 2022
Six months ended Year Ended
30 Nov 2022 30 Nov 2021 31 May 2022
(Unaudited) (Unaudited) (Audited)
$'000 $'000 $'000
Cash flows from operating activities
Loss before income tax (72) (78) (236)
Adjustments for non-cash items
Decrease/(increase) in trade and other receivables
Increase/(decrease) in trade and other payables 11 22 (5)
Interest expense 2 (1) (11)
- - 56
Net cash used in operating activities (59) (57) (196)
Cash flows from financing activities
Loans received 59 53 192
Net cash from financing activities 59 53 192
Net decrease in cash and cash equivalents - (4) (4)
Cash and cash equivalents at the beginning
of the period 1 5 5
Cash and cash equivalents at the end of the period
1 1 1
CRAVEN HOUSE CAPITAL PLC
NOTES TO THE FINANCIAL INFORMATION
FOR THE SIX MONTH PERIOD ENDED 30 NOVEMBER 2022
1. ACCOUNTING POLICIES
General Information
Craven House Capital Plc is a company incorporated in the United Kingdom under
the Companies Act 2006. The address of the registered office is given on the
company information page. The Company is listed on the AIM Market of the
London Stock Exchange (ticker: CRV).
The next annual financial statements of Craven House Capital Plc will be
prepared in accordance with International Financial Reporting Standards and
IFRIC interpretations and with those parts of the Companies Act 2006
applicable to companies reporting under UK adopted international standards.
Accordingly, the interim financial information in this report has been
prepared using accounting policies consistent with IFRS. IFRS are subject to
amendment and interpretation by the International Accounting Standards Board
(IASB) and the International Financial Reporting Interpretations Committee
(IFRIC) and there is an on-going process of review and endorsement by the
European Commission. The financial information has been prepared on the basis
of the IFRS that the directors expect to be applicable as at 31 May 2023.
The financial information has been prepared under the historical cost
convention, except to the extent varied for fair value adjustments required by
accounting standards, and in accordance with International Financial Reporting
Standards and IFRIC interpretations and with those parts of the Companies Act
2006 applicable to companies reporting under UK adopted international
standards. The principal accounting policies have been applied to all periods
presented.
This financial information is unaudited and does not constitute statutory
financial statements within the meaning of Section 434 of the Companies Act
2006. The financial statements of the Company for the year ended 31 May 2022,
which were prepared in accordance with International Financial Reporting
Standards and IFRIC interpretations and with those parts of the Companies Act
2006 applicable to companies reporting under UK adopted international
standards, have been reported on by the Company's auditors and delivered to
the Registrar of Companies. The report of the auditors was unqualified and did
not include any statement under Section 498 of the Companies Act 2006.
This financial information is presented in United States dollar, rounded to
the nearest $'000.
The directors do not propose the issuance of a dividend.
The interim financial information for the six months ended 30 November 2022
was approved by the directors on 24 February 2023.
Going concern
The directors consider that the Company is well placed
to manage its business risks successfully and have a reasonable expectation
that the Company has adequate resources to continue in operational existence
for the foreseeable future. Thus, they continue to adopt the going concern
basis of accounting in preparing the financial information.
CRAVEN HOUSE CAPITAL PLC
NOTES TO THE FINANCIAL INFORMATION - continued
FOR THE SIX MONTH PERIOD ENDED 30 NOVEMBER 2022
2. Taxation
No tax charges arose in the period or in comparative periods as a result of
losses incurred.
3. Investments at fair value through profit or loss
Unquoted equity investments
$'000
Total
$'000
As at 1 June 2022 and 30 November 2022 6,400 6,400
The value of Investments represents the Company's acquisitions during 2020 of
interests in the below-named four UK entities. These are all unquoted
investments and have therefore been measured on a Level 3 basis as no
observable market data is available. Further information on each investment
holding is as follows;
Shares in Garimon Limited are valued at $290,000 representing a 29.9% holding.
The prior period valuation was used as a starting point for estimation of fair
value and the directors have applied consideration to current facts and
circumstances in reviewing the November 2022 valuation. Garimon Limited is the
owner of "Magazinos.com", an on-line media magazine and periodical content
provision service
Shares in Stormfjord Limited are valued at $1,310,000 representing a 26.2%
holding. The valuation of this shareholding is supported by arms-length
financing which occurred during the period and represents the best indication
of the fair value at the period end. Stormfjord is the owner of
www.onebas.com, an optimised search engine providing a portal to music content
freely circulating online.
Shares in Honeydog Limited are valued at $1,600,000 representing a 29.9%
holding, unchanged from the prior period. The prior period valuation was used
as a starting point for estimation of fair value and the directors have
applied consideration to current facts and circumstances in reviewing the
November 2022 valuation. Honeydog Limited is the 25% owner of the entity which
owns the licence to manufacture and distribute the chemotherapy drug, Temodex,
which is used in the treatment of brain tumours.
CRAVEN HOUSE CAPITAL PLC
NOTES TO THE FINANCIAL INFORMATION - continued
FOR THE SIX MONTH PERIOD ENDED 30 NOVEMBER 2022
3. Investments at fair value through profit or loss (continued)
Shares in Rosedog Limited are valued at $1,600,000 representing a 29.9%
holding, unchanged from the prior period. The prior period valuation was used
as a starting point for estimation of fair value and the directors have
applied consideration to current facts and circumstances in reviewing the
November 2022 valuation. Rosedog Limited is the owner of TV Zinos
(www.tvzinos.com), a website which offers a number of free-to-view television
channels
Shares in Bio Vitos Medical Limited are valued at $1,600,000 representing a
24.5% holding, unchanged from the prior period. The prior period valuation was
used as a starting point for estimation of fair value and the directors have
applied consideration to current facts and circumstances in reviewing the
November 2022 valuation. Bio Vitos has a portfolio of over 40 different
Omega-3 supplements in addition to its range of collagen products marketed
under the "Ocean Skin Lab" brand. During the prior period, Bio Vitos acquired
the licence to market a patented heart drug 'Succifer' (also marketed as
'Inofer'), from Double Bond Pharmaceutical AB. The drug has been demonstrated
to improve iron uptake in patients with chronic heart conditions.
The businesses of all of the above portfolio investments are presently
loss-making although their cost bases are low and there is minimal committed
future expenditure, meaning that the extent and timing of the Company's
further investment in the businesses are highly controllable. The Company and
the incumbent management teams of the investee companies will continue to work
together with the aim that these businesses become financially self-sustaining
and generating surpluses within the short- to medium-term and to crystallise
additional capital value for shareholders through strategic, third-party
partnerships.
4. Called up share capital
Authorised, issued and fully paid share capital as at 30 November 2022 is as
follows:
Number Class: Nominal 30 Nov 31 May
Value 2022 2022
(Unaudited) (Audited)
$'000 $'000
3,863,590 Ordinary $1.00 3,802 3,802
3,802 3,802
The aggregate nominal values of the ordinary shares include exchange
differences arising from the translation of shares at historic rates and the
translation at the rate prevailing at the date of the change in functional
currency.
The aggregate nominal values of the ordinary shares include exchange
differences arising from the translation of shares at historic rates and the
translation at the rate prevailing at the date of the change in functional
currency.
CRAVEN HOUSE CAPITAL PLC
NOTES TO THE FINANCIAL INFORMATION - continued
FOR THE SIX MONTH PERIOD ENDED 30 NOVEMBER 2022
5. Earnings per share
The calculation of basic earnings per share is based on the loss attributable
to the equity holders of $72,000 divided by the weighted average number of
shares in issue during the period of 3,863,590 (six months ended 30 November
2021: loss of $78,000 and 3,863,590 shares; year ended 31 May 2022: loss of
$236,000 and 3,863,590 shares).
6. Related party disclosures
Craven Industrial Holdings Plc
During the period, Craven Industrial Holdings Plc paid costs on behalf of and
advanced loans to the Company. At the period end, the outstanding balance due
to Craven Industrial Holdings Plc was $1,296,335. Despite the common director
in Mr M J Pajak, the board of Craven House Capital Plc do not believe that
Craven House Capital Plc or Craven Industrial Holdings Plc are able to exert
control or influence over each other and neither are accustomed to act in
accordance with instructions from the other.
7. Events after the reporting period
On the 8(th) February 2023, the Company announced that its subsidiary,
BioVitos Ltd, had entered into a conditional agreement to undertake an RTO of
Hemcheck Sweden AB, a company listed on the Nasdaq Stockholm. Under the terms
of this agreement, BioVitos has agreed to provide cash to Hemcheck in addition
to IP rights relating to an active substance Iron Succinate (Succifer and used
in a marketed product Inofer). In exchange, Bio Vitos will receive 259,654,000
shares in Hemcheck, amounting to circa 88.3% of Hemcheck's share capital. This
agreement remains subject to approval at a meeting of Hemcheck's shareholders
in the coming weeks.
For further information please contact:
Craven House Capital Plc Tel: 0203 286 8130
Mark Pajak
www.Cravenhousecapital.com (http://www.cravenhousecapital.com/)
SI Capital Tel: 01483 413500
Broker
Nick Emerson
www.sicapital.co.uk (http://www.sicapital.co.uk/)
SPARK Advisory Partners Limited Tel: 0203 368 3550
Nominated Adviser
Matt Davis/James Keeshan
www.Sparkadvisorypartners.com (http://www.sparkadvisorypartners.com/)
About Craven House Capital:
The Company's Investing Policy is primarily to invest in or acquire a
portfolio of companies, partnerships, joint ventures, businesses or other
assets participating in the e-Commerce sector.
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