REG - Hermes Pacific Inv - Final Results
28 September 2020
HERMES PACIFIC INVESTMENTS PLC
(AIM: HPAC)
Final results for the year ended 31 March 2020
Hermes Pacific Investments Plc today reports its financial results for the year ended 31 March 2020.
Chairman's Statement
I am pleased to report the results of Hermes Pacific Investments Plc ("HPAC" or the "Company") for the year ended 31 March 2020. During the year, the Company had no revenues as it does not have any operating business and the Company made a loss of £94,000, which is lower than the loss of £107,000 reported for the previous financial year. We continue our focus to minimise our costs whilst we are looking for opportunities to deploy our cash. At the financial year end the Company had net assets of £3,609,000.
Review of the Company's Activities
The Company is an investing company and has previously made some investments in line with its investing policy in companies involved in financial activities within the emerging market sector. These investments have performed in line with our expectations. We are in a good position from a Balance Sheet perspective and our cash balance as at 31 March 2020 stands at £3,506 million. We have continued to evaluate possible suitable opportunities to deploy our cash resources but have not found any deal that we thought appropriate. Our total comprehensive loss for the year was £133,000 compared to a loss of £119,000 for the previous financial year. The deficit is higher this year compared to last year as there was a loss of £39,000 on investments held by the Company.
The last few years have been filled with Brexit uncertainty. The confusion that has been uppermost in people's minds has cleared up somewhat when the United Kingdom formally left the European Union. There are nonetheless still so many key questions still left unanswered. The United Kingdom is now in a transition period which will end on 31 December 2020. During this period, The United Kingdom is still in the Customs Union and also in the single market with all the applicable European rules still in force. It is anticipated that a deal with the European Union will be reached before the end of the transition period however if there is no agreement on a deal then World Trade Organisation Rules would come into effect. We will continue to monitor closely as this matter does have a significant economic impact.
The Covid-19 pandemic has sent shockwaves throughout the global economy and the uncertainties this has created has impacted investment prospects. Some economies have been affected more severely than others. Within different countries, the virus spread through the population at varying speeds depending on a range of factors such as the cultural and behavioural responses of the community. This pattern has led to substantial variation in the preparedness of countries and their responses to the crisis. Lockdowns were imposed and large parts of the economy were effectively shut down. The worrying aspect is that we still do not have an effective vaccine against Covid 19 and there is fear that countries and economies may be hit by a second wave of infections. Given the uncertainties this creates we will be cautious in any new investments that we make.
The Company continues to seek attractive investment opportunities that will enhance the shareholder value while minimising the downside risks.
Outlook
We have a strong balance sheet and cash resources that place us in a strong position to exploit investment opportunities as they arise.
Haresh Kanabar
Chairman
28 September 2020
Contacts
Hermes Pacific Investments Plc
Haresh Kanabar, Non-Executive Chairman
Tel: +44 (0) 207 290 3340
WH Ireland Limited (Nominated Adviser & Broker)
Mike Coe/ Chris Savidge
Tel: +44 (0) 117 945 3470
Statement of Comprehensive Income for the year ended 31 March 2020
Year ended
31 March
Year ended
31 March
Note
2020
2019
£'000
£'000
Continuing operations
Revenue
-
-
Cost of sales
-
-
gross profit
-
-
Other operating income
-
-
Administrative expenses
(113)
(124)
Operating loss
(113)
(124)
Finance income
19
17
Finance costs
-
-
Loss on ordinary activities before tax
(94)
(107)
Tax expense
-
-
Loss for the year from continuing activities
(94)
(107)
Discontinued operations
Loss for the year from discontinued operations
-
-
Loss for the year
(94)
(107)
Other comprehensive income
Losses arising in the year on investments
Total comprehensive loss for the year
(39)
(133)
(12)
(119)
Basic and diluted loss per share
From continuing operations
4
(4.0)p
(4.6)p
Statement of Financial Position as at 31 March 2020
As at
31 March
As at
31 March
2020
2019
Notes
£'000
£'000
ASSETS
Non-current assets
Investments
123
162
123
162
Current assets
Trade and other receivables
9
1
Cash and cash equivalents
3,506
3,596
3,515
3,597
LIABILITIES
Current liabilities
Trade and other payables
(29)
(17)
(29)
(17)
Net current assets
3,486
3,580
NET ASSETS
3,609
3,742
SHAREHOLDERS' EQUITY
Issued share capital
3,576
3,576
Share premium account
5,781
5,781
Share based payments reserve
Fair value reserve
139
(50)
139
(11)
Retained earnings
(5,837)
(5,743)
TOTAL EQUITY
3,609
3,742
Cash Flow Statement for the year ended 31 March 2020
Note
Year ended 31 March 2020
Year ended
31 March 2019
£'000
£'000
Cash flows from operating activities
(109)
(146)
Cash flows from investing activities
Acquisition of investments
-
-
Income from disposal of subsidiary undertakings
-
-
Net cash (used in)/from investing activities
-
-
Cash flows from financing activities
Proceeds of share issues
Other operating activities
-
19
-
17
Net cash from financing activities
19
17
(Decrease)/increase in cash and cash equivalents
(90)
(129)
Cash and cash equivalents at start of period
3,596
3,725
Cash and cash equivalents at end of period
3,506
3,596
Statement of Changes in Equity for the year ended 31 March 2020
Ordinary share capital
Deferred share capital
Share premium
Share
based payments reserve
Retained earnings
Revaluation reserve
Total
£'000
£'000
£'000
£'000
£'000
£'000
£'000
At 1 April 2018
2,333
1,243
5,781
139
(5,636)
1
3,861
Total comprehensive loss/profit for the
period
-
-
-
-
(107)
(12)
(119)
At 1 April 2019
2,333
1,243
5,781
139
(5,743)
(11)
3,742
Total comprehensive loss for the
period
-
-
-
-
(94)
(39)
(133)
At 31 March 2020
2,333
1,243
5,781
139
(5,837)
(50)
3,609
Notes to the financial statements for the year ended 31 March 2020
1. General information
Hermes Pacific Investments Plc is a company incorporated in the United Kingdom under the Companies Act 2006. The nature of the company's operations and its principal activities are set out in the Directors' Report on page 3.
Statement of compliance
The financial statements comply with International Financial Reporting Standards as adopted by the European Union. At the date of approval of these financial statements, various Standards and Interpretations affecting the Company, which have not been applied in these financial statements, were in issue, but not yet effective (and in some cases had not been adopted by the EU). The Directors have considered these new standards and interpretations and do not expect them to have a material impact on the company.
2. Accounting policies
The following accounting policies have been applied consistently in dealing with items which are considered material in relation to the company's financial statements.
Going concern
The financial statements have been prepared on a going concern basis as, after making appropriate enquiries, the Directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future at the time of approving the financial statements. The outbreak of Covid 19 which has spread globally does not have any impact on our going concern status as we have sufficient cash to fund our activities in the foreseeable future.
Critical accounting estimates and judgments
The preparation of financial statements in conformity with IFRS requires management to make judgements, estimates and assumptions that affect the application of the company's accounting policies with respect to the carrying amounts of assets and liabilities at the date of the financial statements, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting year. The judgements, estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, including current and expected economic conditions. Although these judgements, estimates and associated assumptions are based on management's best knowledge of current events and circumstances, the actual results may differ. Estimates and underlying assumptions are reviewed on an on-going basis. Revisions to accounting estimates are recognised in the year in which the estimate is revised and in any future years affected.
Management have not made any material estimates or judgements that may result in a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year.
Deferred taxation
Deferred taxation is provided in full using the liability method on temporary differences between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. Deferred tax is determined using tax rates that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the related deferred tax asset is realised, or the deferred tax liability is settled.
Deferred tax assets are recognised to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilised.
Cash and cash equivalents
Cash and cash equivalents include cash in hand, deposits held at call with banks, other short term highly liquid funds with original maturities of three months or less and bank overdrafts.
Investments
The company carries its investments at fair value. Gains and losses are either recorded in profit or loss or other comprehensive income. For investments in equity instruments that are not held for trading, this will depend on whether the company has made an irrevocable election at the time of initial recognition to account for the equity investment at fair value through other comprehensive income.
Financial instruments
Financial assets and liabilities are recognised in the balance sheet when the company becomes party to the contractual provisions of the instrument.
Trade and other receivables
Trade receivables are measured at cost less any provision necessary when there is objective evidence that the company will not be able to collect all amounts due.
Trade and other payables
Trade and other payables are not interest bearing and are measured at original invoice amount.
3. Operating loss
Year ended
31 March 2020
Year ended
31 March 2019
£'000
£'000
The operating loss is stated after charging the following, included in administrative expenses:
Staff costs
44
44
Other admin costs
69
80
113
124
4. Loss per share
Year ended
31 March 2020
Year ended
31 March 2019
Basic
Loss from continuing activities (£'000)
(94)
(107)
(94)
(107)
Number of shares
2,333,295
2,333,295
Basic loss per share (p)
From continuing operations
(4.0)p
(4.6)p
(4.0)p
(4.6)p
5. Publication of non-statutory accounts
The Annual Report will be posted to shareholders and will be available on the Company's website (www.hermespacificinvestments.com) shortly.
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