REG - Dukemount Capital - Final Results
30/01/2024 12:15
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RNS Number : 3962B Dukemount Capital PLC 30 January 2024
Dukemount Capital Plc
("Dukemount" or the "Company")
Publication of Annual Report for Year ending September 2023
The Board of Dukemount are pleased to announce the Company's audited financial
statements for the year ended 30 September 2023.
The Annual Report will be available on the Company's corporate website at
www.dukemountcapitalplc.com
For further information, please visit www.dukemountcapitalplc.com or contact:
Dukemount Capital Plc Email: info@dukemountcapitalplc.com
Geoffrey Dart / Paul Gazzard
Peterhouse Capital Limited Tel: +44 (0) 207 469 0930
Lucy Williams/Duncan Vasey
Chairman's Statement
I hereby present the annual financial statements for the period ended 30
September 2023. During the period the Group reported a loss of £407,977
(2022: loss of £1,127,395). These losses arose in the course of the Group
pursuing transactions, maintaining the Company's listing on the Official List
of the UK Listing Authority by way of a standard listing including consultancy
and professional fees and servicing debt. As at the Statement of Financial
Position date the Group had £16,650 (2022: £19,214) of cash balances.
In May 2021, the Company entered into a Joint Venture Agreement in relation to
flexibility power expert HSKB Ltd ("HSKB"). Pursuant to which Dukemount
acquired 50% of the issued share capital of HSKB for nominal value. HSKB
changed its name to DKE Flexible Energy Limited ("DKE Energy"). The Company
was deemed to exercise control through its direct and indirect shareholding of
DKE Energy which was treated as a subsidiary with full consolidation into the
Group financial statements.
In September 2021, the Company signed off a subordinated funding package and
announced in October 2021 that DKE Energy had successfully completed the
purchase of two special purpose companies, each company containing an 11kV gas
peaking facility, ready to build, with full planning permission and grid
access. In October 2022 the Company announced that DKE Energy had completed
the sale of the previously purchased two special purpose companies containing
the 11kV gas peaking facility for an aggregate sale price of £350,000. The
Company had little choice but to pursue the sale despite having the funding in
place to construct these assets. The listing rules for standard list companies
changed in December 2022 to require a minimum market capitalization of £30m
for any reverse, transaction or listed value of the company, far below the
combined value of these two assets in the state they were being purchased or
post construction. Thus, the regulatory environment that evolved for
Dukemount, as a standard listed company, during the transaction to buy and
then fund the construction of the two assets meant the Company had no option
but to dispose of these assets. The proceeds of the sale, £350,000 in
aggregate, were used to repay a portion of the sums owing to the lenders of
the subordinated funding package.
Further to the disposal the lenders agreed to advance net proceeds of £50,000
in aggregate in addition to restructuring their existing funding arrangement.
The maturity date for the existing debt plus the further advance is 24 months
from the date of the Advance (being 10 October 2024). The proceeds of the
further advance were used to settle accrued liabilities of the Company.
Following it's annual general meeting ("AGM") on 12 January 2024, the Company
has undergone a Capital Reorganisation and Chesterfield Capital Limited has
converted an existing £500,000 debt. Further, through extensive discussions
with the existing noteholders pursuant to the existing funding agreement,
the directors executed a net advance of £40,000 to fund immediate capital
requirements.
The Company has also now agreed an irrevocable conditional amendment to the
Existing Funding that its
existing debt (inclusive of the further £40,000 advance) will be reduced to
£900,000; no interest or fees will accrue during the term ;all rights to
receive warrants pursuant to the Existing Funding are released and waived and
a 24 month repayment term from the date of the amendment being effective
The board has therefore taken steps through restructuring the Company's
funding routes, to ensure that the financial position and prospects of the
Company are maintained to facilitate a future reverse transaction.
I would like to thank all those who have assisted and supported the Group
during the period.
Paul Gazzard
Director
29 January 2024
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF DUKEMOUNT CAPITAL PLC
Opinion
We have audited the financial statements of Dukemount Capital plc (the
'group') for the period ended 30 September 2023 which comprise the
Consolidated Statement of Comprehensive Income, the Consolidated and Parent
Company Statements of Financial Position, the Consolidated and Parent Company
Statements of Changes in Equity, the Consolidated and Parent Company
Statements of Cash Flows and notes to the financial statements, including
significant accounting policies. The financial reporting framework that has
been applied in their preparation is applicable law and UK-adopted
international accounting standards and as regards the parent company financial
statements, as applied in accordance with the provisions of the Companies Act
2006.
In our opinion:
• the financial statements give a true and fair view of the state of
the group's and of the parent company's affairs as at 30 September 2023 and of
the group's loss for the period then ended;
• the group financial statements have been properly prepared in
accordance with UK-adopted international accounting standards;
• the parent company financial statements have been properly prepared
in accordance with UK-adopted international accounting standards and as
applied in accordance with the provisions of the Companies Act 2006; and
• the financial statements have been prepared in accordance with the
requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing
(UK) (ISAs (UK)) and applicable law. Our responsibilities under those
standards are further described in the Auditor's responsibilities for the
audit of the financial statements section of our report. We are independent of
the group and parent company in accordance with the ethical requirements that
are relevant to our audit of the financial statements in the UK, including the
FRC's Ethical Standard as applied to listed public interest entities, and we
have fulfilled our other ethical responsibilities in accordance with these
requirements. We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our opinion.
Material uncertainty related to going concern
We draw attention to note 2 in the financial statements, which indicates that
the group is dependent on successful fundraising or a future reverse takeover
transaction to continue as a going concern. The group has no contracts in
place at year-end or after year-end, with no trading plans. Additionally, the
group has a cash balance at the date of approval of the financial statements
that would not be able to support its operations and overheads for the
following twelve months. As stated in note 2, these events or conditions,
along with the other matters as set forth in note 2, indicate that a material
uncertainty exists that may cast significant doubt on the company's ability to
continue as a going concern. Our opinion is not modified in respect of this
matter.
It is a requirement of IFRS that, in determining that the going concern basis
is appropriate, the directors must consider a period of at least twelve months
from the date of approval of the accounts.
Our work in relation to going concern included:
• Discussing future plans with management and review of forecasts;
• Considering the appropriateness and sensitivity of assumptions used
in the preparation of the forecasts;
• Reviewing the results of subsequent events and assessing the impact
on the financial statements;
• Reading board minutes for references to financing difficulties;
• Considering whether management have used all relevant information in
their assessment and enquiring whether any known events or conditions beyond
the period of assessment may affect going concern; and
• Reviewing and considering the impact of any new and amended borrowing
arrangements entered into after the year-end to assist the group to continue
its operations.
In view of the requirement to raise additional funds there is a material
uncertainty with regard to going concern because although the directors are
confident they can raise adequate funding that funding has not been agreed.
In auditing the financial statements, we have concluded that the director's
use of the going concern basis of accounting in the preparation of the
financial statements is appropriate. Our evaluation of the directors'
assessment of the company's ability to continue to adopt the going concern
basis of accounting included reviewing management's assessment and going
concern forecasts for the next twelve months and forming an opinion on whether
the current financial position has the ability to fund the group's costs for
that period.
Our responsibilities and the responsibilities of the directors with respect to
going concern are described in the relevant sections of this report.
Our application of materiality
We apply the concept of materiality both in planning and performing our audit,
and in evaluating the effect of misstatements on our audit and on the
financial statements. For the purposes of determining whether the financial
statements are free from material misstatement, we define materiality as the
magnitude of misstatement that makes it probable that the economic decisions
of a reasonably knowledgeable person would be changed or influenced. We also
determine a level of performance materiality which we use to assess the extent
of testing needed to reduce to an appropriately low level the probability that
the aggregate of uncorrected and undetected misstatements exceeds materiality
for the financial statements as a whole.
We determined the group materiality for the financial statements as a whole to
be £28,000 (2022: £27,000), with the parent company materiality set at
£28,000 (2022: £25,000). Performance materiality was set at £21,000 (2022:
£16,000) and £21,000 (2022: £15,000) respectively. The overall materiality
was based on 10% of loss before taxation (2022: 3% of net assets). Several
adjustments were identified during the course of the audit that were
individually considered to be material and adjusted for by management which
would have increased materiality, however the planned materiality level of
£28,000 was retained.
We agreed with the board that we would report all audit differences identified
during the course of our audit in excess of our triviality level of £1,000
(2022: £1,350) and £1,000 (2022: £1,250) for the group and parent company
respectively.
Our approach to the audit
The audit was scoped by obtaining an understanding of the Group and parent
Company and their environment, including the parent Company's systems of
internal control and assessing the risks of material misstatement.
In designing our audit approach, we determined materiality and assessed the
risks of material misstatement in the financial statements. In particular we
assessed the areas involving significant accounting estimates and judgements
by the directors, notably management's assessment of going concern and
considered future events that are inherently uncertain.
All subsidiaries were fully audited by the same audit team, with a full scope
audit being performed on the complete financial information of the
subsidiaries.
Key audit matters
Key audit matters are those matters that, in our professional judgment, were
of most significance in our audit of the financial statements of the current
period and include the most significant assessed risks of material
misstatement (whether or not due to fraud) we identified, including those
which had the greatest effect on: the overall audit strategy, the allocation
of resources in the audit; and directing the efforts of the engagement team.
These matters were addressed in the context of our audit of the financial
statements as a whole, and in forming our opinion thereon, and we do not
provide a separate opinion on these matters.
In addition to the Material uncertainty related to going concern noted above,
as set out below we have determined Management override of controls to be the
key audit matter to be communicated in our report.
Key audit matter How our scope addressed this matter
Management override of controls
Under ISA (UK) 240 The Auditor's Responsibilities Relating to Fraud in an We considered the potential for the manipulation of financial results to be a
Audit of Financial Statements, there is a presumed significant risk of significant fraud risk.
management override of the system of internal controls.
Our work in this area included:
The primary responsibility for the prevention and detection of fraud rests
with management. Their role in the detection of fraud is an extension of their · A review of journals processed during the period under review and in
role in preventing fraudulent activity. the preparation of the financial statements to determine whether these were
appropriate.
Management are responsible for establishing a sound system of internal control
designed to support the achievement of policies, aims and objectives and to · We reviewed bank transactions throughout the period and since the
manage risks facing an entity; this includes the risk of fraud. year end for material and round sum amounts and evidenced these back to
appropriate documentation.
Management are in a unique position to perpetrate fraud because of their
ability to manipulate accounting records and prepare fraudulent financial · A review of key estimates, judgements and assumptions within the
statements by overriding controls that otherwise appear to be operating financial statements for evidence of management bias and agreement of any such
effectively. to appropriate supporting documentation.
· An assessment of whether the financial results and accounting records
included any significant or unusual transactions where the economic substance
was not clear.
Our conclusion
Overall, we are satisfied that the accounting records and financial statements
are free from material misstatement in this respect.
Other information
The other information comprises the information included in the annual report,
other than the financial statements and our auditor's report thereon. The
directors are responsible for the other information contained within the
annual report. Our opinion on the group and parent company financial
statements does not cover the other information and, except to the extent
otherwise explicitly stated in our report, we do not express any form of
assurance conclusion thereon.
Our responsibility is to read the other information and, in doing so, consider
whether the other information is materially inconsistent with the financial
statements or our knowledge obtained in the course of the audit, or otherwise
appears to be materially misstated. If we identify such material
inconsistencies or apparent material misstatements, we are required to
determine whether this gives rise to a material misstatement in the financial
statements themselves. If, based on the work we have performed, we conclude
that there is a material misstatement of this other information, we are
required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion the part of the directors' remuneration report to be audited
has been properly prepared in accordance with the Companies Act 2006.
In our opinion, based on the work undertaken in the course of the audit:
· the information given in the strategic report and the directors'
report for the financial period for which the financial statements are
prepared is consistent with the financial statements; and
· the strategic report and the directors' report have been prepared in
accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the group and parent
company and their environment obtained in the course of the audit, we have not
identified material misstatements in the strategic report or the directors'
report.
We have nothing to report in respect of the following matters in relation to
which the Companies Act 2006 requires us to report to you if, in our opinion:
· adequate accounting records have not been kept by the parent company,
or returns adequate for our audit have not been received from branches not
visited by us; or
· the parent company financial statements and the part of the
directors' remuneration report to be audited are not in agreement with the
accounting records and returns; or
· certain disclosures of directors' remuneration specified by law are
not made; or
· we have not received all the information and explanations we require
for our audit.
Responsibilities of directors
As explained more fully in the statement of directors' responsibilities, the
directors are responsible for the preparation of the group and parent company
financial statements and for being satisfied that they give a true and fair
view, and for such internal control as the directors determine is necessary
to enable the preparation of financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the group and parent company financial statements, the directors
are responsible for assessing the ability of the group and parent company to
continue as a going concern, disclosing, as applicable, matters related to
going concern and using the going concern basis of accounting unless the
directors either intend to liquidate the group or parent company or to cease
operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial
statements as a whole are free from material misstatement, whether due to
fraud or error, and to issue an auditor's report that includes our opinion.
Reasonable assurance is a high level of assurance but is not a guarantee that
an audit conducted in accordance with ISAs (UK) will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and
are considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on
the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and
regulations. We design procedures in line with our responsibilities, outlined
above, to detect material misstatements in respect of irregularities,
including fraud. The extent to which our procedures are capable of detecting
irregularities, including fraud is detailed below:
We evaluated the Directors' and management's incentives and opportunities for
fraudulent manipulation of the financial statements (including the risk of
override of controls) and determined that the principal risks were related to
posting manual journal entries to manipulate financial performance, management
bias through judgements and assumptions in significant accounting estimates
and significant one-off or unusual transactions.
· Our audit procedures were designed to respond to those identified
risks, including non-compliance with laws and regulations (irregularities) and
fraud that are material to the financial statements. Our audit procedures
included but were not limited to:
· Discussing with the Directors and management their policies and
procedures regarding compliance with laws and regulations;
· Communicating identified laws and regulations throughout our
engagement team and remaining alert to any indications of non-compliance
throughout our audit; and
· Considering the risk of acts by the parent company which were
contrary to applicable laws and regulations, including fraud.
Our audit procedures in relation to fraud included but were not limited to:
· Making enquiries of the Directors and management on whether they had
knowledge of any actual, suspected or alleged fraud;
· Gaining an understanding of the internal controls established to
mitigate risks related to fraud;
· Discussing amongst the engagement team the risks of fraud; and
· Addressing the risks of fraud through management override of controls
by performing journal entry testing.
Because of the inherent limitations of an audit, there is a risk that we will
not detect all irregularities, including those leading to a material
misstatement in the financial statements or non-compliance with regulation.
This risk increases the more that compliance with a law or regulation is
removed from the events and transactions reflected in the financial
statements, as we will be less likely to become aware of instances of
non-compliance. The risk is also greater regarding irregularities occurring
due to fraud rather than error, as fraud involves intentional concealment,
forgery, collusion, omission or misrepresentation.
A further description of our responsibilities for the audit of the financial
statements is located on the Financial Reporting Council's website at:
www.frc.org.uk/auditorsresponsibilities. This description forms part of our
auditor's report.
Other matters which we are required to address
We were appointed by the Board on 5 January 2024 to audit the financial
statements for the period ended 30 September 2023 and subsequent financial
periods. Our total uninterrupted period of engagement is 1 year.
The non-audit services prohibited by the FRC's Ethical Standard were not
provided to the group or the parent company and we remain independent of the
group and the parent company in conducting our audit.
Our audit opinion is consistent with the additional report to the audit
committee.
Use of our report
This report is made solely to the company's members, as a body, in accordance
with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been
undertaken so that we might state to the company's members those matters we
are required to state to them in an auditor's report and for no other purpose.
To the fullest extent permitted by law, we do not accept or assume
responsibility to anyone, other than the company and the company's members as
a body, for our audit work, for this report, or for the opinions we have
formed.
Martin Chatten
(Senior Statutory Auditor)
For and on behalf of Royce Peeling Green Limited
Chartered Accountants
Statutory Auditor
The Copper Room
Deva City Office Park
Trinity Way
Manchester M3 7BG
29 January 2024
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
YEAR ENDED 30 SEPTEMBER 2023
The Accounting Policies and Notes form part of the financial statements.
Note Group Group
30 September 2023 30 April 2022
Continuing operations £ £
Other income 3,731 5,033
Administrative expenses 3 (124,227) (283,162)
Impairment of receivables 9 - (578,779)
Operating loss (120,496) (856,908)
Interest received - -
Finance charges (190,094) (242,773)
Loss before taxation 3 (310,590) (1,099,681)
Income tax 6 - -
Loss for the year from continuing operations (310,590) (1,099,681)
Discontinued operations
Loss for the period/ year from discontinued operations 8 (97,387) (27,714)
Total comprehensive income for the period/ year (407,977) (1,127,395)
Total comprehensive income for the year attributable to:
Owners of Dukemount Capital Plc (359,284) (1,176,088)
Non-controlling interests (48,693) 48,693
(407,977) (1,127,395)
Earnings / (loss) per share attributable to equity owners
Basic and diluted (pence) 11 (0.0006) (0.0022)
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 SEPTEMBER 2023
Note 30 September 2023 30 April 2022
£ £
Assets
Non current assets
Intangible assets 8 - 350,000
- 350,000
Current Assets
Trade and other receivables 9 534 38,164
Cash and cash equivalents 16,650 19,214
Total Assets 17,184 407,378
Equity and Liabilities
Equity
Share capital 12 616,243 513,535
Share premium 13 1,249,305 1,249,305
Share based payments reserve 2,960 2,960
Retained deficit (3,752,485) (3,344,508)
(1,883,977) (1,578,708)
Current Liabilities
Trade and other payables 15 1,901,161 1,986,086
Total Equity and Liabilities 17,184 407,378
Total equity and liabilities attributable to :
Owners of Dukemount Capital Plc 17,184 358,685
Non-controlling interests - 48,693
17,184 407,378
COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 30 SEPTEMBER 2023
Note 30 September 2023 30 April 2022
£ £
Assets
Non current assets
Investment in Subsidiaries 7 101 350,601
Current Assets
Trade and other receivables 9 422 13,436
Cash and cash equivalents 15,897 16,115
_______ _______
Total Assets 16,420 380,152
_______ _______
Equity and Liabilities
Equity
Share capital 12 616,243 513,535
Share premium 13 1,249,305 1,249,305
Share based payments reserve 2,960 2,960
Retained deficit (3,661,004) (3,321,698)
_______ _______
(1,792,496) (1,555,898)
Current Liabilities
Trade and other payables 15 1,808,916 1,936,050
_______ _______
Total Equity and Liabilities 16,420 380,152
_______ _______
The Company has elected to take the exemption under Section 408 of the
Companies Act 2006 from presenting the Parent Company Income Statement and
Statement of Comprehensive Income. The loss for the Parent Company for the
period was £339,306 (2022: £1,130,772) and the total comprehensive loss for
the period was £339,306 (2022: £1,130,772).
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Share capital Share premium Share based payment reserve Retained deficit Total Non controlling interests Total
Equity
£ £ £ £ £ £ £
Balance as at 1 May 2020 481,283 1,115,035 2,960 (2,217,113) (617,835) - (617,835)
Loss for the year - - - (1,176,088) (1,176,088) 48,693 (1,127,395)
Other comprehensive income - - - - - - -
Total comprehensive income for the year - - - (1,176,088) (1,176,088) 48,693 (1,127,395)
Transactions with equity owners
Issue of ordinary shares 32,252 134,270 - - 166,522 - 166,522
Exercise of warrants - - - - - - -
Total transactions with owners 32,252 134,270 - - 166,522 - 166,522
Balance as at 30 April 2022 513,535 1,249,305 2,960 (3,393,201) (1,627,401) 48,693 (1,578,708)
Balance as at 1 May 2022 513,535 1,249,305 2,960 (3,393,201) (1,627,401) 48,693 (1,578,708)
Loss for the period - - - (359,284) (359,284) (48,693) (407,977)
Other comprehensive income - - - - - - -
Total comprehensive income for the period - - - (359,284) (359,284) (48,693) (407,977)
Transactions with equity owners
Issue of ordinary shares 102,708 - - - - - 102,708
Total transactions with owners 102,708 - - - 102,708 - 102,708
Balance as at 30 September 2023
1,249,305 2,960 (3,752,485) (1,883,977) - (1,883,977)
616,243
COMPANY STATEMENT OF CHANGES IN EQUITY
Share Share premium Share based payment reserve Retained deficit Total
Capital
£ £ £ £ £
Balance as at 1 May 2020 481,283 1,115,035 2,960 (2,190,926) (591,648)
Loss for the year - - - (1,130,772) (1,130,772)
Other comprehensive income - - - - -
Total comprehensive income for the year - - - (1,130,772) (1,130,772)
Transactions with equity owners
Issue of ordinary shares 32,252 134,270 - - 166,522
Total transactions with owners 32,252 134,270 - - 166,522
Balance as at 30 April 2022 513,535 1,249,305 2,960 (3,321,698) (1,555,898)
Balance as at 1 May 2022 513,535 1,249,305 2,960 (3,321,698) (1,555,898)
Loss for the period - - - (339,306) (339,306)
Other comprehensive income - - - - -
Total comprehensive income for the year - - - (339,306) (339,306)
Transactions with equity owners
Issue of ordinary shares 102,708 - - - 102,708
Total transactions with owners 102,708 - - - 102,708
Balance as at 30 September 2023 616,243 1,249,305 2,960 (3,661,004) (1,792,496)
CONSOLIDATED STATEMENT OF CASH FLOWS
Note 30 September 2023 30 April
2022
£ £
Cash Flows from Operating Activities
Loss before taxation (407,977) (1,127,395)
Changes in working capital:
Shares issued in lieu of expenses 74,575 30,727
Impairment of goodwill 8 - 125,101
Impairment of receivables 9 - 578,779
(Increase)/decrease in trade and other receivables 9 37,630 (40,627)
(Decrease)/Increase in trade and other payables 15 34,214 (232,722)
Net Cash (used in) Operating Activities (261,558) (666,137)
Cash Flows from Financing Activities
Net proceeds from issue of shares - - -
Loans received 15 123,994 1,000,000
Loans repaid (215,000) -
Net Cash (used in)/ generated from Financing Activities
(91,006) 1,000,000
Cash Flows from Investing Activities
Investment in subsidiary - (339,306)
Disposal of investment in subsidiary 350,000 -
Net cash generated from/ (used in) Investing Activities 350,000 (339,306)
Net Decrease in Cash and Cash Equivalents (2,564) (5,443)
Cash and cash equivalents at the beginning of the year 19,214 24,657
Cash and Cash Equivalents at the End of the Period 16,650 19,214
COMPANY STATEMENT OF CASH FLOWS
Note 30 September 2023 30 April
2022
£ £
Cash Flows from Operating Activities
Loss before taxation (339,306) (1,130,772)
Adjustments for:
Changes in working capital:
Provision against intra group loans 9 20,451 491,628
Impairment charge 8 - 125,101
Shares issued in lieu of expenses 74,575 30,727
Decrease in trade and other receivables 9 13,014 1,060
(Decrease)/increase in trade and other payables 15 (27,946) (176,828)
Net Cash used in Operating Activities (259,212) (659,084)
Cash Flows from Investing Activities
Investment in subsidiary - (339,306)
Disposal of investment in subsidiary 350,000 -
Net Cash used in Investing Activities 350,000 (339,306)
Cash Flows from Financing Activities
Loans received 15 123,994 1,000,000
Loans repaid (215,000) -
Net Cash (used in)/ generated from Financing Activities
(91,006) 1,000,000
Net (Decrease)/ increase in Cash and Cash Equivalents (218) 1,610
Cash and cash equivalents at the beginning of the year 16,115 14,505
Cash and Cash Equivalents at the End of the Period 15,897 16,115
The Accounting Policies and Notes form part of the financial statements.
NOTES TO THE FINANCIAL STATEMENTS
1. General Information
Dukemount Capital Plc was incorporated in the UK on 20 April 2011 as a public
limited company with the name Black Lion Capital Plc. The Company subsequently
changed its name to Black Eagle Capital Plc on 13 September 2011 and on 15
November 2016 changed its name to Dukemount Capital Plc. On 29 March 2017 the
Company was admitted to the London Stock Exchange by way of a standard
listing.
The Group's principal activity is to ensure that the financial position and
prospects of the Company are maintained to facilitate a future reverse
transaction.
The parent company's registered office is located at 70 Jermyn Street, London
SW1Y 6NY.
2. Summary of Significant Accounting Policies
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 periods presented, unless otherwise stated.
a) Basis of Preparation of Financial Statements
The financial statements of Dukemount Capital Plc have been prepared in
accordance with UK-adopted international accounting standards and with the
requirements of the Companies Act 2006 as applicable to companies reporting
under those standards. The financial statements have been prepared under the
historical cost convention.
The financial statements are presented in Pound Sterling (£), rounded to the
nearest pound.
The consolidated financial statements include the Parent company, its wholly
owned subsidiaries DKE (North West) Limited and DKE (Wavertree) Limited and
DKE Flexible Energy Limited in which the Company acquired a 50% equity
interest and was deemed to exercise control from the date of its acquisition
on 20 May 2021 until it was dissolved on 22 August 2023.
The individual entity financial statements of each subsidiary were prepared in
accordance with United Kingdom Generally Accepted Accounting Practice (FRS
101).
The directors resolved in September 2023 to extend the accounting reference
date from 30 April to 30 September; accordingly the current period is for 1
May 2022 to 30 September 2023.
b) Basis of consolidation
Subsidiaries are all entities (including structured entities) over which the
Group has control. The Group controls an entity when the Group is exposed to,
or has rights to, variable returns from its involvement with the entity and
has the ability to affect those returns through its power over the entity.
Subsidiaries are fully consolidated from the date on which control is
transferred to the Group. They are deconsolidated from the date that control
ceases.
The Group re-assesses whether or not it controls an investee if facts and
circumstances indicate that there are changes to one or more of the three
elements of control. Consolidation of a subsidiary begins when the Group
obtains control over the subsidiary and ceases when the Group loses control of
the subsidiary. Assets, liabilities, income and expenses of a subsidiary
acquired or disposed of during the year are included in the consolidated
financial statements from the date the Group gains control until the date the
Group ceases to control the subsidiary.
The group applies the acquisition method to account for business combinations.
The consideration transferred for the acquisition of a subsidiary is the fair
values of the assets transferred, the liabilities incurred to the former
owners of the acquiree and the equity interests issued by the group. The
consideration transferred includes the fair value of any asset or liability
resulting from a contingent consideration arrangement. Identifiable assets
acquired and liabilities and contingent liabilities assumed in a business
combination are measured initially at their fair values at the acquisition
date. The group recognises any non-controlling interest in the acquired
companies on an acquisition-by-acquisition basis, either at fair value or at
the non-controlling interest's proportionate share of the recognised amounts
of acquiree's identifiable net assets.
The Group's interest in Gas Peaking projects is treated as a business
combination instead of an asset acquisition as there is an intention to enter
that business, supported by a business plan.
Inter-company transactions, balances and unrealised gains on transactions
between group companies are eliminated. Unrealised losses are also eliminated.
When necessary, amounts reported by subsidiaries have been adjusted to conform
with the group's accounting policies.
c) Going Concern
The preparation of financial statements requires an assessment on the validity
of the going concern assumption.
The Directors have reviewed projections for a period of at least 12 months
from the date of approval of the Financial Statements.
In making their assessment of going concern, the Directors have discussed the
Company's position with its funders and professional advisors. In January 2024
the Company agreed a term sheet with its current investors and broker in which
its broker will facilitate a capital investment into the Company in the
near-term of circa £500,000 and a commitment to pay certain outstanding fees
The Group's forecasts and projections, taking account of reasonably possible
changes in trading performance, show that the Group has sufficient funds
available to it following events after the year end.
The Directors note that the Group has always been successful with past
fundraises and continue to believe strongly in the Group's potential. However,
the success of securing funding or a reverse transaction has been identified
as a material uncertainty which may cast significant doubt over the going
concern assessment. Whilst acknowledging this uncertainty, based upon the
expectation of completing a successful fundraising in the near future, and the
continued support of it investors and broker, the Directors consider it
appropriate to continue to prepare the financial statements on a going concern
basis.
d) Changes in accounting policies and disclosure
In issue and effective for periods commencing on 1 May 2022
The Company has considered the following amendments to published standards
that are effective for the Company for the financial period beginning 1 May
2022 and concluded that they are either not relevant to the Company or that
they do not have a significant impact on the Company's financial statements
other than disclosures.
· IAS 37 - Provisions, Contingent Liabilities and Contingent Assets -
Amendments regarding the costs to include when assessing whether a contract is
onerous
· IAS 16 - Property, Plant and Equipment - Amendments prohibiting an
entity from deducting from the cost of property, plant and equipment amounts
received from selling items produced while the entity is preparing the asset
for its intended use
· IFRS 3 - Business Combinations - Reference to the Conceptual
Framework
In issue but not effective for periods commencing on 1 May 2022
The following standards and revisions will be effective for future periods:
· IFRS 7 - Financial Instruments: Disclosures - Supplier finance
arrangements
· IFRS 10 - Consolidated Financial Statements - Amendments regarding
the sale or contribution of assets between an investor and its associate or
joint venture
· IFRS 16 - Leases - Amendments regarding seller-lessor subsequent
measurement in a sale and leaseback transaction
· IFRS 17 'Insurance Contracts' - New accounting standard
· IAS 1 - Presentation of Financial Statements - Amendments regarding
the disclosure of accounting policies, Amendments regarding the classification
of liabilities and Amendments regarding the classification of debt with
covenants
· IAS 7 - Statement of Cash Flows - Supplier finance arrangements
· IAS 8 - Accounting Policies, Changes in Accounting Estimates and
Errors - Amendments regarding the definition of accounting estimates
· Amendments to IAS 8 'Accounting Policies, Changes in Accounting
Estimates and Errors' on the definition of accounting estimates
· IAS 12 - Income Taxes - Amendments regarding deferred tax on leases
and decommissioning obligations
· IAS 28 - Investments in Associates and Joint Ventures - Amendments
regarding the sale or contribution of assets between an investor and its
associate or joint venture
The Company has considered the impact of the remaining above standards and
revisions and have concluded that they will not have a significant impact on
the Company's financial statements.
e) Segmental reporting
Identifying and assessing investment projects is the only activity the Group
is involved in and is therefore considered as the only operating/reportable
segment.
Therefore the financial information of the single segment is the same as that
set out in the Statement of Comprehensive Income, Statement of Financial
Position, Statement of Changes in Equity and the Statement of Cashflows.
f) Revenue from contracts with customers
Revenue relates to amounts contractually due under a property development
agreement at the balance sheet date relating to the stage of completion of a
contract as measured by surveys of work performed to date. Revenue is
recognised for services when the Group has satisfied its contractual
performance obligation in respect of the services. The amount recognised for
the services performed is the consideration that the Group is entitled to for
performing the services provided. Revenue from contracts with customers is
recognised over time.
Estimates of revenues, costs or extent of progress toward completion are
revised if circumstances change, and may include cost contingencies to take
into account specific risks within each contract. Cost contingencies are
reviewed on a regular basis throughout the life of the contract. However, the
nature of the risks on projects are such that they often cannot be resolved
until the end of the project and therefore may reverse until the end of the
project. Any resulting increases or decreases in estimated revenues or costs
are reflected in profit or loss in the period in which the circumstances that
give rise to the revision become known by management. The estimated final
outcomes on projects are continuously reviewed, and adjustments are made when
necessary. Provision is made for all known or expected losses on individual
contracts once such losses are foreseen.
Where costs incurred plus recognised profits less recognised losses exceed
progress billings, the balance is recognised as contract assets within trade
and other receivables. Where progress billings exceed costs incurred plus
recognised profits less recognised losses, the balance is recognised as
contract liabilities within trade and other payables.
g) Cash and Cash Equivalents
Cash and cash equivalents comprise cash in hand and current and deposit
balances with banks. This definition is also used for the Statement of Cash
Flows.
The Group considers the credit ratings of banks in which it holds funds in
order to reduce exposure to credit risk.
The Group considers that it is not exposed to major concentrations of credit
risk.
h) Financial Instruments
Financial assets
The Group and Company classifies its financial assets in the following
measurement categories:
• Those to be measured subsequently at fair value through profit or
loss; and
• Those to be measured at amortised cost.
The classification depends on the business model for managing the financial
assets and the contractual terms of the cash flows. Financial assets are
classified as at amortised cost only if both of the following criteria are
met:
• The asset is held within a business model whose objective is to
collect contractual cash flows; and
• The contractual terms give rise to cash flows that are solely
payments of principal and interest.
Financial assets at amortised cost are subsequently measured using the
effective interest rate (EIR) method and are subject to impairment. The
Group's and Company's financial assets at amortised cost include trade and
other receivables, contract assets and cash and cash equivalents. A financial
asset (or, where applicable, a part of a financial asset or part of a group of
similar financial assets) is primarily derecognised when:
• The rights to receive cash flows from the asset have expired; or
• The Group and Company has transferred its rights to receive cash
flows from the asset or has assumed an obligation to pay the received cash
flows in full without material delay to a third party under a 'pass-through'
arrangement; and either (a) the Group and Company has transferred
substantially all the risks and rewards of the asset, or (b) the Group and
Company has neither transferred nor retained substantially all the risks and
rewards of the asset, but has transferred control of the asset.
The Group currently does not recognise an allowance for expected credit losses
(ECLs) for all debt instruments not held at fair value through profit or loss,
as the effect would be immaterial on these financial statements. ECLs are
based on the difference between the contractual cash flows due in accordance
with the contract and all the cash flows that the Group expects to receive,
discounted at an approximation of the original EIR. The expected cash flows
will include cash flows from the sale of collateral held or other credit
enhancements that are integral to the contractual terms.
For trade receivables (not subject to provisional pricing) and other
receivables due in less than 12 months, the Group applies the simplified
approach in calculating ECLs, as permitted by IFRS 9. Therefore, the Group
does not track changes in credit risk, but instead, recognises a loss
allowance based on the financial asset's lifetime ECL at each reporting date.
The Group assesses a non-performing debt based on the payment terms of the
receivable.
i) Financial liabilities
Financial liabilities, comprising trade and other payables, are held at
amortised cost.
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. If not, they are presented as non-current liabilities.
Trade and other payables are recognised initially at fair value, and
subsequently measured at amortised cost using the effective interest method.
j) De-recognition of Financial Instruments
i. Financial Assets
A financial asset is derecognised where:
· the right to receive cash flows from the asset has expired;
· the Group retains the right to receive cash flows from the asset,
but has assumed an obligation to pay them in full without material delay to a
third party under a pass-through arrangement; or
· the Group has transferred the rights to receive cash flows from
the asset, and either has transferred substantially all the risks and rewards
of the asset or has neither transferred nor retained substantially all the
risks and rewards of the asset, but has transferred control of the asset.
ii. Financial Liabilities
A financial liability is derecognised when the obligation under the liability
is discharged or cancelled or expires. Where an existing financial liability
is replaced by another from the same lender on substantially different terms,
or the terms of an existing liability are substantially modified, such an
exchange or modification is treated as a derecognition of the original
liability and the recognition of a new liability, and the difference in the
respective carrying amounts is recognised in the statement of comprehensive
income.
k) Taxation
Current tax
Current tax is based on the taxable profit or loss for the period. Tax is
recognised in profit or loss, except to the extent that it relates to items
recognised in other comprehensive income or recognised in equity. In this
case, the tax is also recognised in other comprehensive income or directly in
equity, respectively.
Current tax is calculated at the tax rates (and laws) that have been enacted
or substantively enacted at the reporting date.
Deferred tax
Deferred tax is recognised using the liability method in respect of temporary
differences arising from differences between the carrying amount of assets and
liabilities in the Financial Statements and the corresponding tax bases used
in the computation of taxable profit. However, deferred tax is not accounted
for if it arises from initial recognition of an asset or liability in a
transaction that at the time of the transaction affects neither accounting nor
taxable profit nor loss. In principle, deferred tax liabilities are recognised
for all taxable temporary differences and deferred tax assets are recognised
to the extent that it is probable that taxable profits will be available
against which deductible temporary differences can be utilised.
Deferred tax assets and liabilities are offset when there is a legally
enforceable right to offset current tax assets against current tax liabilities
and when the deferred tax 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.
Deferred tax is calculated at the tax rates (and laws) that have been enacted
or substantively enacted at the Statement of Financial Position date and are
expected to apply to the period when the deferred tax asset is realised or the
deferred tax liability is settled.
Deferred tax assets and liabilities are not discounted.
l) Equity
Equity comprises the following:
· Share capital representing the nominal value of the equity
shares;
· Share premium representing consideration less nominal value of
issued shares and costs directly attributable to the issue of new shares;
· Share based payments reserve representing the fair value of share
based payments valued in accordance with IFRS 2.
m) Share Capital
Ordinary shares are classified as equity.
n) Share Based Payments
The Group has warrants over the ordinary share capital as described in note
14. In accordance with IFRS 2, the total amount to be expensed over the
vesting period for warrants issued for services is determined by reference to
the fair value of the warrants granted, excluding non‑market vesting
conditions. Non‑market vesting conditions are included in assumptions about
the number of warrants that are expected to vest.
For warrants issued relating to the raising of finance, the relevant expense
is offset against the share premium account. The total amount to be expensed
is determined by reference to the fair rate of the warrants granted, excluding
non‑market vesting conditions. Non‑market vesting conditions are
included in assumptions about the number of warrants that are expected to
vest.
o) Investments
Equity investments in subsidiaries are held at cost, less any provision for
impairment.
p) Financial Risk Management
Financial Risk Factors
The Group's activities expose it to a variety of financial risks: market risk
(price risk), credit risk and liquidity risk. The Group's overall risk
management programme seeks to minimise potential adverse effects on the
Group's financial performance. None of these risks are hedged.
The Group has no foreign currency transactions or borrowings, so is not
exposed to market risk in terms of foreign exchange risk. The Group will
require funding to acquire and develop and/or refurbish its properties and
accordingly will be subject to interest rate risk.
Risk management is undertaken by the Board of Directors.
Market Risk - price risk
The Group was exposed to equity securities price risk because of investments
held by the Group, classified as available-for-sale financial assets. These
assets were sold in the year, and therefore the carrying value at the year end
is £nil, which represents the maximum exposure for the Group.
The Group is not exposed to commodity price risk. The Directors will revisit
the appropriateness of this policy should the Group's operations change in
size or nature.
Credit risk
Credit risk arises from cash and cash equivalents as well as any outstanding
receivables. Management does not expect any losses from non-performance of
these receivables. The amount of exposure to any individual counter party is
subject to a limit, which is assessed by the Board.
The Group considers the credit ratings of banks in which it holds funds in
order to reduce exposure to credit risk, which is stated under the cash and
cash equivalents accounting policy.
Liquidity risk
Liquidity risk arises from the Group's management of working capital. It is
the risk that the Group will encounter difficulty in meeting its financial
obligations as they fall due. The proceeds raised from the placing are being
held as cash to enable the Group to fund a transaction as and when a suitable
target is found.
Controls over expenditure are carefully managed, in order to maintain its cash
reserves whilst it targets a suitable transaction.
Financial liabilities are all due within one year.
Capital risk management
The Group's objectives when managing capital is to safeguard the Group's
ability to continue as a going concern, in order to provide returns for
shareholders and benefits for other stakeholders, and to maintain an optimal
capital structure. The Group has no borrowings.
In order to maintain or adjust the capital structure, the Group may adjust the
amount of dividends paid to shareholders, return capital to shareholders or
issue new shares.
The Group monitors capital on the basis of the total equity held by the Group,
being a net asset of £17,184 as at 30 September 2023 (2022: net asset
£407,378).
q) Critical Accounting Estimates and Judgements
The Directors make estimates and assumptions concerning the future as required
by the preparation of the financial statements in conformity with UK-adopted
international accounting standards. The resulting accounting estimates will,
by definition, seldom equal the related actual results.
Estimates and judgements are continually evaluated and are based on historical
experience and other factors, including expectations of future events that are
believed to be reasonable under the circumstances.
i) Share based payments
In accordance with IFRS 2 'Share Based Payments' the Group has recognised the
fair value of warrants calculated using the Black-Scholes option pricing
model. The Directors have made significant assumptions particularly regarding
the volatility of the share price at the grant date in order to calculate a
total fair value. Further information is disclosed in Note 14.
ii) Percentage completion method used for long term contracts
The Group makes an estimate of the stage of completion of a development
project based on the costs incurred at the year end. Management then make
assumptions regarding the collectability of billings and expected future
costs. The method used is as stated in the constructions contract accounting
policy 2f). Estimation uncertainty will exist with regard to the gross profit
being recognised at the year end. The Directors believe that this uncertainty
is reduced to an acceptable level by using quantity surveyors' reports to
assess the stage of contract completion at the year end.
3. Expenses by Nature
2023 2022
£ £
Directors' fees - 51,250
Establishment costs - 28,733
Legal and professional fees 62,365 40,763
Listing/ regulatory costs 58,131 26,592
Travel and accommodation - 2,196
Other expenses - 3,494
Finance charges 190,094 242,773
Impairment (Note 8) - 125,101
Impairment (Note 9) - 578,779
Total Administrative Expenses 310,590 1,099,681
Finance charges relate to fees and interest incurred in financing activities;
£190,094 (2022: £242,773) of which £74,575 (2022: £141,522) was satisfied
by the issue of ordinary shares.
4. Directors' Remuneration
Company
2023 2022
£ £
Geoffrey Dart - 37,500
Paul Gazzard - 13,750
_____ _____
Total - 51,250
______ ______
The Directors have elected not to be paid, nor accrue their entitlement. Other
benefits of £nil (2022: £nil) were also paid to the directors.
Details of directors' remuneration are included in the Directors' Remuneration
Report.
The average number of employees (including directors) during the period was 2
(2022: 2).
5. Services provided by the Company's Auditors
During the year, the Group obtained the following services from the Group's
auditors:
2023 2022
£ £
Fees payable to the Company's auditor for:
Audit of the Group and Company:
Royce Peeling Green Limited 28,000 -
PKF Littlejohn LLP - 70,000
Audit of the subsidiary undertakings:
Royce Peeling Green Limited 2,000 -
PKF Littlejohn LLP - -
30,000 70,000
6. Taxation
Tax Charge for the Year
No taxation arises on the result for the year due to taxable losses.
Factors Affecting the Tax Charge for the Period
The tax credit for the period does not equate to the loss for the period at
the applicable rate of UK Corporation Tax of 21.12% (2022: 19.00%). The
differences are explained below:
2023 2022
£ £
Loss for the period before taxation (407,977) (1,127,395)
______ ______
Loss for the period before taxation multiplied by the standard (86,164) (214,205)
rate of UK Corporation of 21.12% (2022: 19.00%)
Losses carried forward on which no deferred tax asset is recognised 65,596 214,205
Non taxable items 20,568 -
______ ______
- -
______ ______
Factors Affecting the Tax Charge of Future Periods
Tax losses available to be carried forward by the Group at 30 September 2023
against future profits are estimated at £3,971,152 (2022: £3,907,301).
A deferred tax asset has not been recognised in respect of these losses in
view of uncertainty as to the level of future taxable profits. There is no
expiry date on carried forward tax losses.
7. Investment in subsidiaries
Company
2023 2022
£ £
Shares in Group Undertakings
As at 1 May 350,601 101
Additions/(disposal) in the year (350,500) 475,601
Impairment (note 8) - (125,101)
At 30 April 101 350,601
Details of Subsidiaries
Details of the subsidiaries at 30 September 2023 are as follows:
Name of subsidiary Address of registered office Country of incorporation Share capital held by Parent % share capital held Principal activities
DKE (North West) Limited 70 Jermyn Street, London, UK England 100 100% Property management and development
DKE (Wavertree) Limited 70 Jermyn Street, London, UK England 1 100% Property management and development
Dukemount Limited 70 Jermyn Street, London, UK England 1 100% Dormant
8. Intangible assets
Goodwill
2023
£
As at 1 May 2022 350,000
Disposal in the period (350,000)
At 30 September 2023 -
On 1 October 2021 the Group purchased two special purpose companies, ARL 018
Limited and ADV 001 Limited through its subsidiary undertaking, DKE Flexible
Energy Limited ("DKE Energy") resulting in goodwill on consolidation at 30
April 2022 of £475,101. Each company containing the rights to an 11kV gas
peaking facility, ready to build, with full planning permission and grid
access.
In performing an assessment of the carrying value of the assets at 30 April
2022, the Directors concluded that as no development activity had been
undertaken during the year ended 30 April 2022, it was appropriate to book an
impairment of £125,101, resulting in a carrying value of £350,000 at 30
April 2022. The Directors formed this opinion based upon their calculation of
estimated fair value less cost to sell. This was considered to be in excess
of the carrying value of the asset.
The regulatory environment that evolved during the period since acquisition to
buy and then fund the construction of the two assets meant there was no real
activity during the period and on 5 October 2022, DKE Flexible Energy Limited
sold the two special purpose companies, for an aggregate sale price of
£350,000 resulting in a loss on disposal of the discontinued operation of
£97,387.
The proceeds of the sale were used to repay a portion of the sums owing to the
Company's lenders.
DKE Flexible Energy Limited was dissolved on 22 August 2023.
Results of discontinued operations comprised:
2023 2022
£ £
Administrative expenses - (27,642)
Other income - 125,029
Impairment of goodwill - (125,101)
Loss on disposal (97,387) -
(97,387) (27,714)
9. Trade and Other Receivables
Group Company Group Company
2023 2023 2022 2022
£ £ £
Other receivables, including prepayments 534 422 38,164 13,436
Amounts owed by group undertakings - - - -
534 422 38,164 13,436
The fair value of all receivables is the same as their carrying values stated
above.
The maximum exposure to credit risk at the reporting date is the carrying value mentioned above. The Group does not hold any collateral as security.
Amounts due from group undertakings are unsecured, interest free, have no
fixed date of repayment and repayable on demand.
10. Dividends
No dividend has been declared or paid by the Company during the period ended
30 September 2023 (2022: £nil).
11. Earnings/ (loss) per share
Basic earnings/ (loss) per share is calculated by dividing the profit/ (loss)
attributable to equity holders of the Group by the weighted average number of
ordinary shares in issue during the period/ year. In accordance with IAS 33,
basic and diluted earnings per share are identical as the effect of the
exercise of the warrants would be to decrease the loss per share.
2023
2022
£
£
Loss attributable to equity holders of the
Group
359,284 1,127,395
______ ________
Total
359,284 1,127,395
______ ________
Weighted average number of ordinary shares in issue
(thousands) 582,659 504,873
______ ________
Basic and diluted loss per share
2023 2022
£
£
Continuing Operations - basic and diluted
(0.0006)
(0.0022)
12. Share Capital
Group and Company
2023 2022
No. No
(000's) (000's)
Allotted, issued and fully paid
Beginning of year 513,535 481,283
New shares issued (102,707,190 ordinary shares of £0.001 each) 102,708 32,252
At end of period 616,243 513,535
616,243,164 ordinary shares of £0.001 each
(2022: 513,535,974 ordinary shares of £0.001 each)
13. Share Premium
Group and Company
Share Premium Share issue costs Net Share Premium
£ £ £
At 1 May 2022 1,274,108 (25,803) 1,249,305
Issue of shares - - -
At 30 September 2023 1,274,108 (25,803) 1,249,305
14. Share Based Payments
Details of warrants outstanding at 30 September 2023 are included below.
Number Weighted average exercise price (£)
As at 1 May 2022 64,000 0.005
Expired during period (64,000) 0.005
Outstanding/ exercisable as at 30 September 2023 - -
15. Trade and Other Payables Restated
Group Company Group Company
2023 2023 2022 2022
£ £ £ £
Trade payables 102,560 91,406 306,296 272,549
Other loans 1,678,601 1,597,510 1,601,250 1,601,250
Accruals 120,000 120,000 78,540 62,251
1,901,161 1,808,916 1,986,086 1,936,050
Comparative balances have been restated as to the analysis of trade creditors
and other loans.
In May 2021, the Company entered into a 12-month interest free convertible
unsecured loan facility for £1,000,000 ("Facility"). The Facility was
convertible at the election of the Company or the Lenders into ordinary shares
at a deemed issued price of £0.0065 per share, subject to the Company having
sufficient authorities in place and to the publication of any prospectus
required pursuant to the Prospectus Regulation Rules. In June 2021, the
Company issued 13,286,713 ordinary shares as payment under the Facility
Agreement in relation to fees. An availability fee of £70,000, £10,000
drawdown fees and reimbursement of legal fees were converted into ordinary
shares at 0.715p.
In September 2021, the Company signed off a subordinated funding package
necessary to enable completion of the senior debt funding for the gas peaking
projects first announced via its JV with HSKB in March 2021. The funding
package assembled by the Company comprised: £3,000,000 mezzanine, 18 month
loan facility with 4 month repayment holiday. £1,000,000 was drawn down
immediately upon execution.
On 5 October 2022 the Company announced it had completed the sale of two
special purpose companies for an aggregate sale price of £350,000. The
proceeds of the sale were used to repay a portion of the sums owing to the
lenders. Further to the disposal, the lenders agreed to advance net proceeds
of £50,000 in aggregate in addition to restructuring their existing funding
arrangement. The maturity date for the existing debt plus the further advance
is 24 months from the date of the Advance (being 10 October 2024). The
proceeds of the further advance were used to settle accrued liabilities of the
Company.
There was a balance of £1,097,510 at 30 September 2023 (April 2022:
£1,101,250) including charges and accrued interest. The terms of this new
facility were varied in October 2022 with total amounts due deferred and to be
repaid under new terms.
The board has taken steps to ensure that the financial position and prospects
of the Company are maintained to facilitate a future reverse transaction. To
that end, the board has confirmed that the directors have released the Company
from all accrued but unpaid emoluments. Following the year end, Chesterfield
Capital Limited has converted its outstanding balance of £500,000 into
ordinary shares (Note 20).
The restructuring and further advance debt terms have since the year end, been
amended (Note 20). The existing debt is now reduced to £900,000. No interest
or fees will accrue during its 24 month term.
16. Treasury Policy and Financial Instruments
The Group operates an informal treasury policy which includes the ongoing
assessments of interest rate management and borrowing policy. The Board
approves all decisions on treasury policy.
The Group has financed its activities by the raising of funds through the
placing of shares.
There are no material differences between the book value and fair value of the
financiainstruments.
Group Company Group Company
2023 2023 2022 2022
£ £ £ £
Carrying amount of financial assets
Measured at amortised cost 17,184 16,420 407,378 380,152
17,184 16,420 407,378 380,152
Carrying amount of financial liabilities
Measured at amortised cost 1,901,161 1,808,916 1,986,086 1,936,050
1,901,161 1,808,916 1,986,086 1,936,050
17 Capital Commitments
There were no capital commitments authorised by the Directors or contracted
for at 30 September 2023.
18. Related Party Transactions
The Directors are Key Management and information in respect of key management
is given in Note 4.
At 30 September 2023, the Company was due £230,885 (2022: £223,365) from DKE
(Wavertree) Limited, its wholly owned subsidiary. The Company has provided
against this amount in full.
At 30 September 2023, the Company was due £281,194 (2022: £268,263) from DKE
(Northwest) Limited, its wholly owned subsidiary. The Company has provided
against this amount in full.
At 30 September 2023, the Company was due £nil (2022: £339,306) from DKE
Flexible Energy Limited, a company in which Dukemount owned 50% of the shares
and in which Paul Gazzard was a shareholder. DKE Flexible Energy Limited sold
its interests in ADV 001 Limited and ARL 018 Limited for aggregate proceeds of
£350,000 in October 2022 which was paid back to the Company.
At 30 September 2023 the Company owed Chesterfield Capital Limited £500,000
(2022: £500,000) under an unsecured 0% convertible loan instrument dated 8
December 2020. The instrument was due for repayment of conversion by 9 May
2021. Geoffrey Dart is a director of Chesterfield Capital Limited.
At 30 September 2023 the Company owed Arlington (Group Services) Limited £nil
(2022: £21,600) in respect of rent charges. Paul Gazzard is a director of
Arlington (Group Services) Limited.
19. Ultimate Controlling Party
The Directors believe there to be no ultimate controlling party.
20. Events after the reporting period
The Company held its annual general meeting ("AGM") on 12 January 2024 where
all resolutions set out in the Company's Notice of Annual General Meeting were
approved. As a result, the Company has undergone a Capital Reorganisation and
the Existing Ordinary Shares have undergone a 1:10 consolidation. Following
the consolidation, the Consolidated Ordinary Shares were then subsequently
sub-divided into one New Ordinary Share of £0.001 each and one deferred share
of £0.009. The New Ordinary Shares have the same rights as the Existing
Ordinary Shares, including voting, dividend, and other rights. Further,
Chesterfield Capital Limited has converted an existing £500,000 debt at
£0.065 per New Ordinary share in the Company (being 7,692,307 new ordinary
shares of £0.001 each) following the Capital Reorganisation. Admission of
all the New Ordinary Shares became effective on 18 January 2024. Following
Admission, the Company now has 69,316,623 ordinary shares of £0.001 each in
issue, none of which are held in treasury.
As a result of all resolutions being passed at the AGM, through extensive
discussions with the existing noteholders (the "Investors") pursuant to the
existing funding agreement (as detailed in the announcement of 11 October
2022) (the "Existing Funding"), the directors executed a net advance of
£40,000 to fund immediate capital requirements of the Company.
The Investors have now agreed an irrevocable conditional amendment to the
Existing Funding as follows:
o the existing debt (inclusive of the further £40,000 advance) will be
reduced to £900,000 (being a decrease of over 20% of the accrued balances).
o no interest or fees will accrue during the term (i.e. the outstanding
balance is frozen).
o all rights to receive warrants pursuant to the Existing Funding are
released and waived.
o 24 month repayment term from the date of the amendment being effective
o upon completion of a reverse takeover, the Company may elect for either
(a) the Existing Funding to be converted into equity at the relevant placing
price for the RTO or (b) the Existing Funding will be repaid (i) 50% of the
outstanding balance on completion, (ii) 25% - 13 months from completion and
(iii) 25% - 24 months from completion.
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