REG - Hermes Pacific Inv - Final Results
26/09/2022 07:01
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RNS Number : 5183A Hermes Pacific Investments PLC 26 September 2022
This announcement contains inside information for the purposes of Article 7 of
the UK version of Regulation (EU) No 596/2014 which is part of UK law by
virtue of the European Union (Withdrawal) Act 2018, as amended ("MAR"). Upon
the publication of this announcement via a Regulatory Information Service,
this inside information is now considered to be in the public domain.
26 September 2022
HERMES PACIFIC INVESTMENTS PLC
(the "Company")
Final results for the year ended 31 March 2022
Hermes Pacific Investments Plc (AIM: HPAC) today reports its financial results
for the year ended 31 March 2022 ("Period" or "Year")
Chairman's statement
I am pleased to report the results of Hermes Pacific Investments Plc for the
year ended 31 March 2022. During the Year, the Company had no revenues as it
does not have any operating business and the Company made a loss of £105,000,
which is marginally lower than the loss of £106,000 reported for the previous
financial year. We continued our focus to minimise our costs whilst we looked
for opportunities to deploy our cash. At the financial year end the Company
had net assets of £3,486,000 (FY21: £3,554,000). During the Period we
adopted a new investment policy focused principally, but not exclusively in
the property sector and we are pleased that post the Period end we identified
a suitable opportunity and purchased a two-bedroom leasehold flat and a single
garage in Westcliff-on-sea, Southend-on-Sea.
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 management's expectations. We are in a good position from a
balance sheet perspective and our cash balance as at 31 March 2022 stood at
£3.284 million (FY21: £3.395 million). During the Year we have continued to
evaluate possible suitable opportunities to deploy our cash resources but did
not identify any transaction that met our criteria. However, as mentioned
above, we are delighted to have completed on the purchase of a two-bedroom
leasehold flat and a single garage in Westcliff-on-sea, Southend-on-Sea post
the Period end. Our total comprehensive loss for the year was £68,000
compared to a loss of £55,000 for the previous financial year. There was a
gain of £37,000 on investments held by the Company.
During the Period no further investments were made. A new investment policy,
focused principally, but not exclusively in the property sector, was adopted
by the Company following shareholder approval on 14 December 2021. Further
details of the new investment policy adopted during the Period are set out
below. .
New investing policy
The Company's new investing policy is to invest principally, but not
exclusively in the property sector within Europe and the Middle East ("New
Investment Policy"). Accordingly, the New Investing Policy is as follows:-
The investments to be made by the Company may be either quoted or unquoted; in
debt and/or in equity instruments, may be in companies, partnerships, joint
ventures; or direct interests in property or property projects (either
residential or commercial property). The Company's equity interest in a
proposed investment may range from a minority position to 100 per cent.
ownership.
The Directors believe there are opportunities to invest in and acquire
commercial and/or residential properties where the properties may be
undervalued and/or suitable for redevelopment to enhance capital value.
The Company will identify and assess potential properties and where it
believes further investigation is required, and subject to assessment of
potential risk, intends to appoint appropriately qualified advisers to assist.
Where further investigation is required, the Company intends to carry out a
comprehensive and thorough investment review process in which all material
aspects of any potential property investment will be subject to due diligence.
The Company's financial resources may be invested in a small number of
properties or investments or potentially in just one investment which may be
deemed to be a reverse takeover of the Company under the AIM Rules. Where this
is the case, it is intended to mitigate the risk by undertaking an appropriate
due diligence process. Any transaction constituting a reverse takeover under
the AIM Rules would require Shareholders' approval. The possibility of
building a broader portfolio of properties has not, however, been excluded.
The Company may also continue to review and investigate non-property related
investments as it has done to date.
The Company's investments may take the form of equity, debt or convertible
instruments. Investments may be made in all types of assets falling within the
remit of the New Investing Policy and there will be no investment
restrictions. Proposed investments may be made in either quoted or unquoted
companies and structured as a direct acquisition, joint venture or as a direct
interest in a project or property. The Directors may consider it appropriate
to take an equity interest in any proposed investment which may range from a
minority position to 100 per cent ownership. The Company may be either an
active investor or passive investor. Where the Company is an active investor,
it may seek representation on the board of investee companies.
Post Period end highlights
The Company has purchased a two-bedroom leasehold flat and a single garage in
Westcliff-on-sea, Southend-on-Sea as announced on 19 May 2022. The purchase
price of £594,907 has been funded from the Company's existing cash resources.
This flat has been now been rented out on assured shorthold tenancy agreement.
Haresh Kanabar
Chairman
26 September 2022
Contacts
Hermes Pacific Investments Plc www.hermespacificinvestments.com (http://www.hermespacificinvestments.com/)
Haresh Kanabar, Non-Executive Chairman Tel: +44 (0) 207 290 3340
WH Ireland Limited ( Nominated Adviser & Broker) www.whirelandcb.com (http://www.whirelandcb.com/)
Mike Coe/ Sarah Mather Tel: +44 (0) 207 220 1666
STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 MARCH 2022
Year ended Year ended
31 March 31 March
Note 2022 2021
£'000 £'000
Continuing operations
Revenue - -
Cost of sales - -
gross profit - -
Other operating income - -
Administrative expenses 3 (111) (114)
Operating loss (111) (114)
Finance income 6 8
Finance costs - -
Loss on ordinary activities before tax (105) (106)
Tax expense 7 - -
Loss for the year from continuing activities (105) (106)
Discontinued operations
Loss for the year from discontinued operations - -
Loss for the year (105) (106)
Other comprehensive income
Gain/(losses) arising in the year on investments 37 51
Total comprehensive loss for the year (68) (55)
Basic and diluted loss per share
From continuing operations 8 (4.5)p (4.5)p
STATEMENT OF FINANCIAL POSITION AS AT 31 MARCH 2022
As at As at
31 March 31 March
2022 2021
Notes £'000 £'000
ASSETS
Non-current assets
Investments 9 211 173
211 173
Current assets
Trade and other receivables 11 10 9
Cash and cash equivalents 10 3,284 3,395
3,294 3,404
LIABILITIES
Current liabilities
Trade and other payables 12 (19) (23)
(19) (23)
Net current assets 3,275 3,381
NET ASSETS 3,486 3,554
SHAREHOLDERS' EQUITY
Issued share capital 13 3,576 3,576
Share premium account 5,781 5,781
Share based payments reserve 139 139
Fair value reserve 38 1
Retained earnings (6,048) (5,943)
TOTAL EQUITY 3,486 3,554
The financial statements were approved and authorised for issue by the board
of directors on 26 September 2022 and signed on its behalf by:
Haresh
Kanabar
Director
Company number: 05239281
CASH FLOW STATEMENT for the YEAR ended 31 March 2022
Note Year ended Year ended
31 March 2022 31 March 2021
£'000 £'000
Cash flows from operating activities 15 (117) (119)
Cash flows from investing activities
Acquisition of investments - -
Income from disposal of subsidiary undertakings - -
Investment income 6 8
Net cash (used in)/from investing activities 6 8
Cash flows from financing activities
Proceeds of share issues -
Other operating activities
Net cash from financing activities - -
(Decrease)/increase in cash and cash equivalents (111) (111)
Cash and cash equivalents at start of period 10 3,395 3,506
Cash and cash equivalents at end of period 10 3,284 3,395
Cash and cash equivalents at end of period
10
3,284
3,395
STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 MARCH 2022
Share premium Share Retained earnings Revaluation reserve Total
Ordinary share capital Deferred share capital based payments reserve
£'000 £'000 £'000 £'000 £'000 £'000 £'000
At 1 April 2020 2,333 1,243 5,781 139 (5,837) (50) 3,609
Total comprehensive loss/profit for the - - - - (106) 51 (55)
period
At 1 April 2021 2,333 1,243 5,781 139 (5,943) 1 3,554
Total comprehensive loss for the - - - - (105) 37 (68)
period
At 31 March 2022 2,333 1,243 5,781 139 (6,048) 38 3,486
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2022
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 4.
Statement of compliance
The Group financial statements were prepared in accordance with UK adopted
international accounting standards and with the requirements of the Companies
Act 2006.
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. 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.
Critical accounting estimates and judgments
The preparation of financial statements in conformity with UK adopted
international accounting standards 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 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 Year ended
31 March 2022 31 March 2021
£'000 £'000
The operating loss is stated after charging the following, included in
administrative expenses:
Staff costs 34 43
Other admin costs 77 71
111 114
4. Auditors' remuneration
Year ended Year ended
31 March 2022 31 March 2021
£'000 £'000
Audit fees:
- statutory audit of the accounts 12 12
12 12
5. Directors' emoluments
Year ended Year ended
31 March 2022 31 March 2021
£'000 £'000
Emoluments for qualifying services:
H Kanabar 22 22
J Berry (resigned) 0 9
J Morton 12 12
34 43
6. Employees and staff costs
The company has no employees. Staff costs comprises payments made in respect
of services provided by the directors.
7. Taxation
Year ended Year ended
31 March 2022 31 March 2021
£'000 £'000
Continuing operations:
Current tax charge - -
Adjustment in respect of prior years - -
Current tax credit - -
Factors affecting the tax charge for the period
Loss from continuing operations before taxation (105) (106)
Loss from continuing operations before taxation multiplied by standard rate of (20) (20)
corporation tax of 19% (2021: 19%)
Effects of:
Temporary timing differences - -
Non deductible expenses - -
Depreciation in excess of capital allowances - -
Unutilised tax losses 20 20
Current tax charge - -
The company has approximately £4.1m (2021: £4m) of trading losses to carry
forward and offset against future trading profits
8. Loss per share
Year ended Year ended
31 March 2022 31 March 2021
Basic
Loss from continuing activities (£'000) (105) (106)
(105) (106)
Number of shares 2,333,295 2,333,295
Basic loss per share (p)
From continuing operations (4.5)p (4.5)p
(4.5)p (4.5)p
9. Investments
Investments
£'000
Cost or valuation
Brought forward 173
Fair value movement 38
At 31 March 2022 211
The directors have elected to hold the investments at fair value through OCI
as it is their intention to hold these for the long term
10. Cash and cash
equivalents
2022 2021
£'000 £'000
Cash at bank and in hand 3,284 3,395
3,284 3,395
11. Trade and other receivables
2022 2021
£'000 £'000
Other receivables 10 9
10 9
12. Trade and other payables
2022 2021
£'000 £'000
Trade payables 3 8
Accruals and deferred income 16 15
19 23
13. Share capital
2022 2021
£'000 £'000
Issued and fully paid
2,333,295 ordinary shares of 100p each 2,333 2,333
13,079,850 deferred shares of 9.5p each 1,243 1,243
3,576 3,576
All ordinary shares rank equally in respect of shareholders' rights.
The deferred shares have no voting and dividend rights. On winding up of the
company, they will be entitled to the nominal value only after all ordinary
shareholders receive the nominal value of their shares plus £10m per share.
As at 31 March 2022 and 31 March 2021 the authorised share capital was
3,500,000 ordinary shares of 100p and 200,000,000 deferred shares of 9.5p.
14. Financial Instruments
Financial risk management
The company's activities expose the company to a number of risks including
credit risk, interest rate risk and liquidity risk. The Board manages these
risks through a risk management programme. The fair value of the company's
assets and liabilities at 31 March 2022 are not materially different from
their book value.
2022 2021
£'000 £'000
Financial assets at fair value
through other comprehensive income 211 173
211 173
The fair value measured is categorised within level 1 of the fair value
hierarchy.
Financial assets at amortised cost 2022 2021
£'000 £'000
Loan and receivables:
Trade and other receivables 10 9
Cash and cash equivalents 3,284 3,395
3,294 3,404
Financial liabilities at amortised cost 2022 2021
£'000 £'000
Trade and other payables 19 23
19 23
Credit risk
The company monitors credit risk on an on-going basis and manages risk by
concentrating on trading and placing bank deposits with reliable
counterparties. The company has no significant concentration of credit risk
associated with trading counterparties. Credit risk predominantly arises from
cash and cash equivalents.
Interest rate risk
The company has interest bearing assets. Interest bearing assets comprise cash
balances which earn interest at a variable rate. The financial liabilities in
the current year are all non-interest bearing. The company has not entered
into derivatives transactions and has not traded in financial instruments
during the period under review. The entire company's debt is non-interest
bearing there would be no effect on the company if interest rates changed.
Liquidity risk
The company seeks to manage liquidity risk by ensuring sufficient liquidity is
available to meet foreseeable needs and to invest cash assets safely and
profitably. All cash and cash equivalents are immediately accessible.
Price risk
The company's exposure to equity securities price risk arises from investments
held by the company and classified in the statement of financial position
either as at fair value through other comprehensive income or at fair value
through profit or loss. The risk is managed by regular reviews of the
portfolio of investments held to ensure that exposure to price movements is
within acceptable limits.
The maturity dates of the company's financial instruments are shown below and
are based on the period outstanding at the balance sheet date up to the
contractual maturity date.
Between Between
Less than 6 months and 1 year 1 and 5 years
6 months Total
£'000 £'000 £'000 £'000
2022
Financial Assets
Variable interest rate instruments 3,284 - - 3,284
Non-interest bearing - 10 - 10
3,284 10 - 3,294
Financial Liabilities
Non-interest bearing 19 - - 19
19 - - 19
Between Between
Less than 6 months and 1 year 1 and 5 years
6 months Total
£'000 £'000 £'000 £'000
2021
Financial Assets
Variable interest rate instruments 3,395 - - 3,395
Non-interest bearing - 9 - 9
3,395 9 - 3,404
Financial Liabilities
Non-interest bearing 23 - - 23
23 - - 23
15. Cash flows from operating activities
Year ended Year ended
31 March 2022 31 March 2021
£'000 £'000
Operating loss (111) (114)
Depreciation of property, plant and equipment - -
Operating cash flows before movements in working capital (111) (114)
(Increase)/Decrease in trade and other receivables (1) -
(Decrease)/Increase in trade and other payables (5) (5)
Cash flows from operating activities (117) (119)
16. Related party transactions
Key Management Personnel and Director Transactions
A number of key management personnel, or their related parties, hold positions
in other entities that result in them having control or significant influence
over the financial and operating policies of these entities.
A number of these entities transacted with the company during the year. The
terms and conditions of these transactions with key management personnel and
their related parties were no more favourable than those available, or which
might reasonably be expected to be available, on similar transactions to
non-key management personnel related entities on an arm's length basis.
The aggregate value of transactions related to key management personnel and
entities over which they have control or significant influence was £33,600
(2021: £42,800).
During the year, the company used the services of Poonam & Roshni Limited
totalling £21,600 (2021: £21,600). H Kanabar is a director of both
companies. No balance was outstanding at the year end (2021: Nil).
During the year the company used the services of Thirty Acre Stables totalling
£12,000 (2021: £12,000). J Morton is the owner of that business. No balance
was outstanding at the year end (2021: Nil).
The compensation of key management is as disclosed in the
directors' emoluments note.
17. Events after the end of the reporting period
Subsequent to the reporting date, the company purchased an
investment property for £594,907.
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