Eight Capital Ptnrs. - Half-year Report
30/09/2024 07:00
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RNS Number : 1592G Eight Capital Partners PLC 30 September 2024
30 September 2024
EIGHT CAPITAL PARTNERS PLC
("Eight Capital" "ECP" or the "Company")
UNAUDITED INTERIM REPORT FOR THE SIX MONTHS ENDED 30 JUNE 2024
Eight Capital Partners plc (AQSE: ECP), the financial services operating
company that aims to grow revenue through businesses engaged in "Fintech"
operations including in the digital banking and lending sectors announces its
interim for the half year ending 30 June 2024. Comparative figures are shown
for the comparable period in the previous financial year unless otherwise
stated:
Chairman's Interim Report
I am pleased to report the Company's interim results to 30 June 2024.
Revenues continue to be volatile, which is to be expected given the nature of
the underlying transaction led business, falling to £0.003m (2023: £0.6m).
Overhead costs including foreign exchange losses of £0.5m (2023: £0.7m) and
net of any gains or losses on investments remain stable at £1.2m (2023:
£1.2m). Losses for the 6 months to 30 June 2024 are £1.3m (2023: £1.3m
profit) with approximately half of the costs from non-cash foreign exchange
charges
The Company has been active in the last six months progressing negotiations on
potential investments in two European banks and two fintech working capital
providers, in line with its strategy. Progress included agreeing non-binding
term sheets as well as in two cases completing advanced due diligence on two
target businesses, a bank and a fintech operator. The company however did
not proceed with these two targets and has subsequently initiated discussions
with an alternative fintech operator, as well as working on the opportunity of
creating a new regulated fintech business in Europe.
During the period the operations of Innovative Finance S.r.l were discontinued
with the business and team transferred over to Epsion Capital Limited.
The key issue for the business is managing the 1AF2 Bond settlement process.
As disclosed in our market announcements in July and August 2024, negotiations
with 1AF2 Limited (1AF2) continue and the proposal currently being negotiated
with 1AF2 and The Avantgarde Group S.p.a (TAG) involves TAG acquiring the 1AF2
bond from ECP at par value with settlement through a portfolio of cash, public
securities and private assets. In the RNS released on 22 August 2024 the
Company announced that an additional EUR 4m of listed bond assets have been
transferred to ECP as additional security.
It remains the plan to receive cash, public securities and private assets in
return for the 1AF2 bond held by the Company. Meetings and written exchanges
are ongoing to progress ECP towards that objective. The Company continues to
seek the best outcome for shareholder value.
Given the additional security now provided and the current state of
negotiations with 1AF2 and TAG the board is comfortable that value of the bond
remains as it was in the financial statements at 31 December 2023 and
accordingly no further write downs are felt to be necessary. We will continue
to update the market as negotiations continue.
Dominic White
Chairman
27 September 2024
The directors of the Company take responsibility for this announcement.
For further information, please contact:
Eight Capital Partners plc +44 20 3808 0029
Dominic White, Chairman info@eight.capital
Luciano Maranzana, Group CEO
AQSE Exchange Growth Market Corporate Adviser
Cairn Financial Advisers LLP +44 20 7213 0880
Jo Turner / Liam Murray
Eight Capital Partners plc
Unaudited Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income
for the six months ended 30 June 2024
RESTATED
Note Six months ended Six months ended Year ended
30 30 31 December
June June 2023
2024 2023 Audited
Unaudited Unaudited £'000
£'000 £'000
Revenue 3 572 602
Other operating income 5 51 40
Corporate advisory fees (31) - (599)
Foreign exchange loss (535) (708) (244)
General expenses (375) (235) (402)
Legal and professional fees (159) (94) (355)
Rent and rates (13) (30) (84)
Staff costs (108) (177) (335)
Discontinued operations 55 - -
Net change in unrealised/realised gains and losses on investments at fair (390) (14,562)
value through profit or loss
1,724
Goodwill impairment - - (2,717)
Impairment of other receivables recognised at amortised cost - - (554)
(Loss) / profit from operations (1,548) 1,103 (19,210)
Finance income 294 437 874
Finance expense including debt modification gain or loss (47) (221) (610)
(Loss) / profit before tax (1,301) 1,319 (18,946)
Taxation - - -
(Loss) / profit for the period (1,301) 1,319 (18,946)
Other comprehensive income - - -
Total comprehensive income (1,301) 1,319 (18,946)
Basic and diluted earnings / (loss) per share (pence): 2 (0.0007) 0.0008 (0.01)
Eight Capital Partners plc
Unaudited Condensed Consolidated Statement of Financial Position at 30 June 2024
Note As at As at As at
30 30 31 December
June June 2023
2024 Unaudited 2023 Unaudited Audited
£'000 £'000 £'000
Non-current assets
Goodwill - 2,717 -
Intangible assets - 7 -
Property, plant and equipment 3 18 15
Total non-current assets 3 2,742 15
Current assets
Investments 3 13,124 30,457 14,517
Trade and other receivables 211 1,138 487
Cash and cash equivalents 42 40 35
Total current assets 13,377 31,635 15,039
Current liabilities
Trade and other payables 1,004 818 1,362
Loans and borrowings - 1,016 -
Total current liabilities 1,004 1,834 1,362
Non-current liabilities
Long term bond 882 5,948 897
Total non-current liabilities 882 5,948 897
Net assets 11,494 26,595 12,795
Capital and reserves
Share Capital 4 20,042 17,484 20,042
Share premium account 21,999 18,099 21,999
Convertible loan notes 84 84 84
Currency translation reserve - (7) -
Retained earnings (30,631) (9,065) (29,330)
Total equity 11,494 26,595 12,795
Eight Capital Partners plc
Unaudited Condensed Consolidated Cash Flow Statement for the six months ended 30 June 2024
Note Six months ended Six months ended Year ended
30 30 31 December
June June 2023
2024 2023 Audited
Unaudited Unaudited £'000
£'000 £'000
Cash flows from operating activities
(Loss) / profit for the period (1,301) 1,319 (18,946)
Adjustments for:
Depreciation of property plant and equipment - 4 7
Amortisation of intangible fixed assets - 3 11
Equity settled current liability - - 41
Share based payment expense released - (7)
Finance income (294) (437) (874)
Finance expense 47 221 610
Net change in unrealised / realised gains and losses on investments at fair 3 390 (1,724) 14,562
value through profit or loss
Goodwill impairment - - 2,717
Impairment of other receivables at amortised cost - - 554
Net foreign exchange loss / (gain) 535 708 244
(623) 87 (1,074)
Movements in working capital:
Decrease in trade and other receivables 276 (476) 113
Increase in trade and other payables (358) 245 266
Net cash used in operating activities (705) (144) (695)
Cash flows from investing activities
Proceeds on disposal of property plant and equipment 12 - -
Proceeds on sale of financial assets 434 - 26
Interest received 304 437 839
Net cash from investing activities 750 437 865
Cash flows from financing activities
Repayment of loans - - (20)
Proceeds from borrowings - - 73
Interest paid (38) (275) (210)
Net cash used in financing activities (38) (275) (157)
Eight Capital Partners plc
Unaudited Condensed Consolidated Cash Flow Statement for the six months ended 30 June 2024
(continued)
Net increase / decrease in cash and cash equivalents 7 18 13
Cash and cash equivalents at the beginning of the period 35 22 22
Cash and cash equivalents at the end of the period 42 40 35
Eight Capital Partners plc
Unaudited Condensed Consolidated Statement of Changes in Equity for the six months ended 30 June 2024
Share capital Share premium Convertible debt option reserve Other reserves Retained Earnings Total equity
£000 £000 £000 £000 £000 £000
At 1 January 2023 17,484 18,099 84 - (10,384) 25,283
Changes in equity for period
Profit for period - - - - 1,319 1,319
Other comprehensive income - - - (7) - (7)
At 30 June 2023 17,484 18,099 84 (7) (9,065) 26,595
Changes in equity for period
Loss for period - - - - (20,265) (20,265)
Other comprehensive income - - - 7 - 7
Share issues 2,558 3,900 - - - 6,458
At 31 December 2023 20,042 21,999 84 - (29,330) 12,795
Changes in equity for period
Loss for period - - - - (1,301) (1,301)
At 30 June 2024 20,042 21,999 84 - (30,631) 11,494
Eight Capital Partners plc
Notes to the Interim Financial Statements
For the six months ended 30 June 2024
1. Accounting policies
Basis of preparation
These interim financial statements have been prepared in accordance with
UK-adopted international accounting standards.
The interim financial statements do not include all disclosures that would
otherwise be required in a complete set of financial statements and should be
read in conjunction with the 2023 audited annual report. The statutory
financial statements for the year ended 31 December 2023 were prepared in
accordance with UK-adopted international accounting standards. The auditors
reported on those financial statements and their audit report was unqualified.
The interim financial information is unaudited, has not been reviewed by the
Company's auditors and does not constitute statutory accounts as defined in
the Companies Act 2006.
The interim financial information was approved and authorised for issue by the
board of directors on
27 September 2024.
Going concern
As at the date of this report, the Group had cash or cash equivalents, listed
shares and contractually agreed receivables amounting to an aggregate £0.4m.
In addition, the Company will in due course be the recipient of the IAF2 Bond
settlement. The board believes that the Company will have sufficient working
capital for at least the next 12 months from the date of these accounts.
2. Profit or loss per share
Six months ended 30 June 2024 Six months Year ended
ended 30 June 2023
£'000
31 December 2023
£'000
£'000
Basic and diluted
(Loss) / profit for the period attributable to owners of the Company (1,301) 1,319 (18,946)
Weighted average number of shares: 187,451,702,503 161,873,969,648 169,533,235,805
Basic earnings / (loss) per share (pence): (0.0007) 0.0008 (0.01)
The basic and diluted earnings per share were determined by dividing the
profit or loss attributable to the equity holders of the Company by the
weighted average number of shares outstanding during the periods.
3. Investments
Listed investments Total
£'000 £'000
Fair value at 1 January 2023 28,785 28,785
Additions 809 809
Fair value adjustments 1,718 1,718
Foreign exchange adjustment (855) (855)
Fair value at 30 June 2023 30,457 30,457
Additions 1 1
Disposals (26) (26)
Fair value adjustment (16,280) (16,280)
Foreign exchange adjustments 365 365
Fair value at 31 December 2023 14,517 14,517
Disposals (434) (434)
Fair value loss on listed investments (400) (400)
Foreign exchange adjustments (559) (559)
Fair value at 30 June 2024 13,124 13,124
The table below sets out the fair value measurements using the fair value
hierarchy. Categorisation within the hierarchy has been determined on the
basis of the lowest level of input that is significant to the fair value
measurement of the relevant asset as follows:
Level 1 - valued using quoted prices in active markets for identical assets.
Level 2 - valued by reference to valuation techniques using observable inputs
other than quoted prices included within Level 1.
Level 3 - valued by reference to valuation techniques using inputs that are
not based on observable market data.
There were no transfers between categories during the period.
Six months ended 30 June 2024 Six months Year ended
ended 30 June 2023
£'000
31 December 2023
£'000
£'000
Categorised as
Level 1 - quoted investments 175 783 574
Level 2 - unquoted investments using quoted prices - - -
Level 3 - unquoted investments and illiquid quoted investments 12,949 29,674 13,943
13,124 30,457 14,517
4. Share capital
Ordinary share capital is summarised below:
Number of Ordinary Shares of 0.01p Nominal value
£'000
As at 31 December 2023 and 30 June 2024 187,451,702,503 18,745
Deferred share capital is summarised below:
Number of Deferred Shares of 0.24p Nominal value
£'000
As at 31 December 2023 and 30 June 2024 540,166,760 1,297
5. Restatement of prior period Consolidated Statement of Profit or Loss and Other Comprehensive Income
During the year ended 31 December 2023, the Directors elected to change the
basis of reporting the Consolidated Statement of Profit or Loss and Other
Comprehensive Income from by function to by nature as they considered that
this methodology more appropriately represented the Group's business model.
In addition, the administration expenses were overstated by £81,000 in the 30
June 2023 Interim Accounts.
Due to this change in basis of reporting and amended administration expenses,
the comparative results for the period ended 30 June 2023 have been restated
and a summary of the changes made is set out below:
As previously disclosed As restated Change
30 June 2023
30 June 2023
£000 £000 £000
Revenue 572 572 -
Cost of sales (4) - 4
Other operating income 51 51
Administrative expenses (1,321) - 1,321
Foreign exchange loss - (708) (708)
General expenses - (235) (235)
Legal and professional - (94) (94)
Rent and rates - (30) (30)
Staff costs - (177) (177)
Net change in unrealised/realised gains and losses on 1,724 1,724 -
investments at fair value through profit or loss
Profit from operations 1,022 1,103 81
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