Fintech Asia Limited - Interim Results
28/09/2023 07:00
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RNS Number : 8937N Fintech Asia Limited 28 September 2023
FINTECH ASIA LIMITED
("Fintech Asia" or the "Company")
Interim Results for the 12 months ended 30 June 2023
Fintech Asia, (LON:FINA) a company established to acquire one or more
companies or businesses in the financial technology sector, focused on
improving the delivery and use of financial services in Asia, is pleased to
announce the Company's unaudited interim results for the 12 months ended 30
June 2023. These follow the change in the Company's accounting reference
date from 30 June to 31 December, as announced on 21 June 2023.
Chief Executive Officer's Statement
I am pleased to present the interim report and unaudited financial statements
for Fintech Asia Limited for the 12 months to 30 June 2023.
Proposed Acquisition and Temporary Share Suspension
On 14 March 2023, the Company announced its entry into a head of terms to
acquire the entire issued share capital of InvesCore Financial Group Pte. Ltd
("InvesCore" or the "Target") (the "Proposed Acquisition").
InvesCore is a group of companies with its primary operations in the
micro-finance sector, offering loans and investment products to businesses and
individuals, primarily in Asia, and has developed technologies, including a
mobile application, to sell certain of its product lines. It is an exciting
business that meets the characteristics that we have been looking for to align
to our acquisition strategy.
The Proposed Acquisition is classified as a reverse takeover in accordance
with the FCA's Listing Rules. Accordingly, the Company requested the
temporary suspension of its listing on the London Stock Exchange which became
effective on 14 March 2023.
Since the announcement of the Proposed Acquisition, the Company has continued
to advance discussions with the Target with a view to agreeing terms to
conclude a definitive Sale and Purchase Agreement and seek regulatory approval
for future readmission to the Main Market of the London Stock Exchange.
Alongside these discussions a detailed due diligence process is being
undertaken. We cannot, at this time, confirm that these discussions and
regulatory approvals will be successful, however at the time of publication we
can confirm that the process remains active and ongoing.
Administrator, Company Secretary, and Registered Office
On 24 March 2023, the Company appointed New Street Management Limited and NSM
Services Limited as its Administrator and Company Secretary, respectively.
The Board wishes to thank Intertrust International Management Limited and
Cosign Limited who previously fulfilled these functions. The Company's
registered office changed to Les Echelons Court, Les Echelons, St Peter Port,
Guernsey GY1 1AR.
Change of Accounting Date
On 21 June 2023, the Company changed its accounting reference date and
financial year end from 30 June to 31 December. Going forward the annual and
interim reports will be published each year for the 12 months to 31 December
and 6 months to 30 June, respectively.
Convertible Loan Facility
Post period end, on 8 September 2023, the Company announced it had obtained an
unsecured committed facility of £1 million via a convertible loan note
instrument (the "Convertible Loan"). The Convertible Loan will be made
available in three tranches over September and October 2023 with an interest
rate equating to a fixed amount of five per cent. per annum. The first tranche
of the Convertible Loan (£350,000) has been received by the Company with the
second tranche due shortly.
The Convertible Loan is intended to bridge the Company's general working
capital requirements, to the extent required, as the board seeks to finalise
due diligence and documentation in respect of its Proposed Acquisition and the
simultaneous re-admission of its enlarged share capital to the Standard
Segment of the Official List maintained by the FCA and readmitted to trading
on the Main Market of the London Stock Exchange, as announced on 14 March
2023.
On behalf of the Board, I thank the shareholders and advisors of the Company
for their continued support.
Oliver Fox
Chief Executive Officer
27 September 2023
For further information please contact:
Fintech Asia Limited Via IFC
Oliver Fox, CEO
Strand Hanson Limited (Financial Advisor) +44 (0) 207 409 3494
Rory Murphy / Abigail Wennington
Novum Securities (Broker) +44 (0) 207 399 9400
Colin Rowbury
IFC Advisory Limited (Financial PR and IR) +44 (0) 203 934 6630
Tim Metcalfe
Zach Cohen
LEI: 213800C7BC4EZQAEBT76
Statement of Directors' Responsibilities
The Directors are responsible for preparing the interim report and unaudited
financial statements, in accordance with applicable law and regulations. The
Directors confirm to the best of their knowledge that:
· the condensed set of unaudited financial statements has been prepared
in accordance with IAS 34 'Interim Financial Reporting' of UK-adopted
International Accounting Standards;
· this interim report includes a fair review of the information
required by DTR 4.2.7R of the FCA's Disclosure Guidance and Transparency
Rules, being an indication of important events that have occurred during the
first twelve months of the financial period and their impact on the condensed
set of financial statements, and a description of the principal risks and
uncertainties for the remaining six months of the financial period;
· the interim report includes a fair review of the information required
by DTR 4.2.8R (disclosure of related parties transactions and changes
therein); and
· the condensed set of unaudited financial statements, which has been
prepared in accordance with the applicable set of accounting standards, gives
a true and fair view of the assets, liabilities, financial position and profit
or loss as required by DTR 4.2.10R.
The Directors are responsible for keeping proper accounting records that are
sufficient to show and explain the Company's transactions and which disclose
with reasonable accuracy at any time the financial position of the Company and
enable them to ensure that its financial statements comply with The Companies
(Guernsey) Law, 2008 (as amended). They are also responsible for taking such
steps as are reasonably open to them to safeguard the assets of the Company
and to prevent and detect fraud and other
irregularities.
Principal Risks and Uncertainties
The following is a summary of key risks that, alone or in combination with
other events or circumstance, the Directors has determined could have a
material adverse effect on the Company's business, financial condition,
results of operations and prospects. The Company has considered circumstances
such as the probability of the risk materialising, the potential impact which
the materialisation of the risk could have on the Company's business,
financial condition, and prospects, and the attention that management would,
on the basis of current expectations, have to devote to these risks if they
were to materialise:
· the Company's future success is dependent upon its ability not only
to identify opportunities but also to execute a successful acquisition;
· although the Company will conduct due diligence on potential
acquisitions to a level considered appropriate and reasonable by the
Directors, material adverse issues may not be revealed;
· the Company may need to seek additional sources of funding to
implement its strategy; and
· the performance of sectors in which the Company intends to invest may
be affected by changes in general economic activity levels which are beyond
the Company's control.
A full list of risks can be found in the Company's prospectus, dated 12
September 2022 and published on the Company's website
(www.fintechasialtd.com).
A review of the main financial risks faced by the Company, and how they are
managed or mitigated, is set out in note 14 to the financial statements.
Going Concern
The Directors believe that the Company has adequate financial resources to
continue its operational existence for at least 12 months from the date of the
approval of these financial statements. Please see the disclosures made in
note 4 to these financial statements for details of the estimates and
judgements applied in arriving at this conclusion.
Accordingly, the Directors believe that it is appropriate to continue to adopt
the going concern basis in preparing the financial statements.
Signed on behalf of the Board by:
Nicola Walker
Director
27 September 2023
FINTECH ASIA LIMITED
UNAUDITED CONDENSED STATEMENT OF COMPREHENSIVE INCOME
FOR THE 12 MONTH PERIOD FROM 1 JULY 2022 TO 30 JUNE 2023
Period 1 July 2022 to 30 June 2023 Period 28 May 2021 to 30 June 2022
(unaudited) (unaudited)
Notes GBP GBP
Income
Bank and other interest 6,840 35
Total income 6,840 35
Expenses
Operating expenses 5 (1,332,651) (397,351)
Total expenses (1,332,651) (397,351)
Foreign exchange movement (906) (655)
Loss before tax (1,326,717) (397,971)
Tax 8 - -
Total comprehensive loss (1,326,717) (397,971)
The accompanying notes form an integral part of these financial statements.
FINTECH ASIA LIMITED
UNAUDITED CONDENSED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2023
As at As at
30 June 2023 30 June 2022
(unaudited) (unaudited)
Notes GBP GBP GBP GBP
Current assets
Cash and cash equivalents 456,115 215,885
Other current assets 6 9,657 5,192
465,772 221,077
Current liabilities
Accounts payable 7 (99,460) (33,048)
(99,460) (33,048)
Net current assets 366,312 188,029
Net assets 366,312 188,029
Capital and Reserves
Share capital 9 - -
Share premium 9 2,041,000 586,000
Share based payments 9 50,000
Retained earnings (1,724,688) (397,971)
Total equity 366,312 188,029
The accompanying notes form an integral part of these financial statements.
The financial statements were approved and authorised for issue by the Board
of Directors on 27 September 2023 and were signed on its behalf by:
Nicola Walker
Director
FINTECH ASIA LIMITED
UNAUDITED CONDENSED STATEMENT OF CHANGES IN EQUITY
FOR THE 12 MONTH PERIOD FROM 1 JULY 2022 TO 30 JUNE 2023
Share Capital Share Premium Share based payments Retained earnings Total
GBP GBP GBP GBP GBP
Balance at 28 May 2021 - - - - -
Share capital issued 1 586,000 - - 586,001
Redemption of redeemable shares (1) - - - (1)
Total comprehensive loss - - - (397,971) (397,971)
Balance at 30 June 2022 - 586,000 - (397,971) 188,029
Shares issued - 1,455,000 50,000 - 1,505,000
Total comprehensive loss - - - (1,326,717) (1,326,717)
Balance at 30 June 2023 - 2,041,000 50,000 (1,724,688) 366,312
The accompanying notes form an integral part of these financial statements.
FINTECH ASIA LIMITED
UNAUDITED CONDENSED STATEMENT OF CASH FLOWS
FOR THE 12 MONTH PERIOD FROM 1 JULY 2022 TO 30 JUNE 2023
30 June 2023 30 June 2022
(unaudited) (unaudited)
Notes GBP GBP
Operating activities
Loss for the period (1,326,717) (397,971)
Adjustments for:
Share based payment charge 50,000 -
Movement in receivables 6 (4,465) (5,193)
Movement in payables 7 66,412 33,048
Net cash flow from operating activities (1,214,770) (370,116)
Financing activity
Share capital issued 9 1,455,000 586,001
Net cash flow from financing activities 1,455,000 586,001
Net change in cash and cash equivalents 240,230 215,885
Cash and cash equivalents at the beginning of the period 215,885 -
Cash and cash equivalents at the end of the period 456,115 215,885
The accompanying notes form an integral part of these financial statements.
FINTECH ASIA LIMITED
NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS
FOR THE 12 MONTH PERIOD FROM 1 JULY 2022 TO 30 JUNE 2023
1. GENERAL INFORMATION
Fintech Asia Limited (the "Company") was incorporated on 28 May 2021 in
Guernsey under The Companies (Guernsey) Law, 2008, as amended and is
registered in Guernsey. The address of the Company's registered office is
Les Echelons Court, Les Echelons, St Peter Port, Guernsey, GY1 1AR and the
Company's registration number is 69264. On 15 September 2022 the Company was
admitted to the main market for listed securities of the London Stock Exchange
under the ticker symbol "FINA" with shares registered with an ISIN of
GG00BPGZTM87 and SEDOL of BPGZTM8.
On 14 March 2023, the Company announced that it has entered into a head of
terms to acquire the entire issued share capital of InvesCore Financial Group
Pte. Ltd. (the "Proposed Acquisition"). The Proposed Acquisition is
classified as a reverse takeover in accordance with the FCA's Listing Rules.
Accordingly, the Company requested the temporary suspension of its listing on
the London Stock Exchange.
On 21 June 2023, the Company announced that it had changed its accounting date
from 30 June to 31 December. The Company will prepare an audited report and
accounts for the 18 months to 31 December 2023.
STATEMENT OF COMPLIANCE
These financial statements give a true and fair view, comply with The
Companies (Guernsey) Law, 2008, as amended and were prepared in accordance
with the UK-adopted International Accounting Standards ("IAS's"). IAS's
include standards and interpretations approved by the International Accounting
Standards Board ("IASB") and interpretations issued by the International
Financial Reporting Interpretations Committee who replaced the Standards
Interpretations Committee.
2. BASIS OF PREPARATION
The financial statements have been prepared under the historical cost
convention, modified to include certain items at fair value, and in accordance
with IAS's. IAS's include standards and interpretations approved by the IASB.
The functional and presentation currency of these financial statements is
Pounds Sterling.
3. PRINCIPAL ACCOUNTING POLICIES
Financial Assets
The Company's financial assets are cash and cash equivalents and other current
assets. The classification is determined by management at initial recognition
and depends on the purpose for which the financial assets are acquired.
The Company initially recognises receivables issued when the Company becomes a
party to the contractual provisions of the instrument. Financial assets are
initially recognised at fair value plus transaction costs for all financial
assets not carried at fair value through profit or loss.
Receivables are subsequently carried at amortised cost using the effective
interest method. Amortised cost is the initial measurement amount adjusted for
the amortisation of any differences between the initial and maturity amounts
using the effective interest method. Loans and receivables are reviewed for
impairment assessment.
Cash and cash equivalents
Cash and cash equivalents include cash in hand, deposits held at call with
banks, other short-term highly liquid investments with original maturities of
three months or less any bank overdrafts.
Other current assets
Other current assets principally consist of prepayments which are carried at
amortised cost. The Company assesses at each end of the reporting period
whether there is objective evidence that a financial asset or group of
financial assets is impaired. A financial asset or group of financial assets
is impaired and impairment losses are incurred only if there is objective
evidence of impairment as a result of one or more events that have occurred
after the initial recognition of the asset (a 'loss event') and that loss
event (or events) has an impact on the estimated future cash flows of the
financial asset or group of financial assets that can be reliably estimated.
The amount of the loss is measured as the difference between the asset's
carrying amount and the present value of estimated future cash flows
(excluding future credit losses that have not been incurred) discounted at the
financial asset's original effective interest rate. The carrying amount of the
asset is reduced and the amount of the loss is recognised in profit or loss.
If, in a subsequent period, the amount of the impairment loss decreases and
the decrease can be related objectively to an event occurring after the
impairment was recognised (such as an improvement in the debtor's credit
rating), the reversal of the previously recognised impairment loss is
recognised in profit or loss.
Financial assets are derecognised when the rights to receive cash flows from
the financial assets have expired or have been transferred and the Company has
transferred substantially all risks and rewards of ownership or has not
retained control of the financial asset.
Financial liabilities
All financial liabilities are initially recognised on the trade date when the
entity becomes party to the contractual provisions of the instrument.
Financial liabilities which include trade and other payables and are
recognised initially at fair value, net of directly attributable transaction
costs.
Financial liabilities are subsequently stated at amortised cost, using the
effective interest method. Financial liabilities are classified as current
liabilities if payment is due to be settled within one year or less after the
end of the reporting period (or in the normal operating cycle of the business,
if longer), or the Company does not have an unconditional right to defer
settlement of the liability for at least twelve months after the end of the
reporting period. Otherwise, these are presented as non-current liabilities.
Financial liabilities are derecognised from the statement of financial
position only when the obligations are extinguished either through discharge,
cancellation, or expiration. The difference between the carrying amount of the
financial liability derecognised and the consideration paid or payable is
recognised in profit or loss.
Equity
Share capital represents the nominal value of shares that have been issued.
Equity-settled transactions are measured at fair value (excluding the effect
of non-market-based vesting conditions) at the date of grant. The fair value
determined at the grant date of the equity-settled share-based payments is
expensed on the date of grant.
Share premium includes any contributions from equity holders over and above
the nominal value of shares issued. Any transaction costs associated with the
issuance of shares are deducted from share premium.
Retained earnings represent all current period results of operations as
reported in the statement of profit or loss, reduced by the amounts of
dividends declared.
Share-based payments
The Company operates equity-settled share-based payment arrangements, whereby
the fair value of services provided is determined indirectly by reference to
the fair value of the instrument granted.
The fair value of the grant is recognised as an expense in the Income
Statement with a corresponding increase in equity reserves.
The fair value of options is calculated using the Black Scholes model, taking
into account the terms and conditions upon which the options were granted.
The fair value of shares issued is measured using the observable market value.
Costs and expenses
Cost and expenses are recognised in profit or loss upon utilisation of goods
or services or at the date they are incurred. All finance costs are reported
in profit or loss on an accrual basis.
Going concern
These financial statements have been prepared on the going concern basis,
which assumes the Company shall be able to meet all of its obligations as they
fall due for a period of at least 12 months from the date of this report.
4. USE OF JUDGEMENTS AND ESTIMATES
The preparation of financial statements in accordance with IFRS requires the
Directors to make judgements, estimates and assumptions that affect the
application of policies and the reported amounts of assets and liabilities and
income and expenses. The estimates and associated assumptions are based on
various factors that are believed to be reasonable under the circumstances.
Actual results may differ from these estimates.
Going concern
In determining whether these financial statements should be prepared on the
going concern basis, the Directors must consider whether the business has
adequate financial resources to continue to operate and meet its obligations
for a period of at least 12 months from the date of this report.
The Directors have considered the funding needs of the business as it
continues to progress the proposed transaction with the Target and has
determined that these costs exceed the current cash held in the Company.
However, on 8 September 2023 the Company secured a £1m convertible loan
facility, drawable in three tranches over the course of September and October,
to ensure that cash is available to the Company as and when it is required in
order to see the proposed transaction through to its conclusion. Please see
note 15 of these financial statements for further details. Any costs
requiring settlement following completion of the proposed transaction and
readmission of the Company to the LSE will be met by the combined company out
of operational cashflows or any further finance raised as part of the
readmission process.
In the event that the transaction does not complete for various reasons, a
break fee is receivable from the Target, as disclosed in detail in the Company
announcement of 14 March 2023, which the Directors consider to be sufficient
to settle all costs incurred in support of the transaction up to the point of
abandonment and ensure sufficient working capital availability for the Company
to continue to pursue alternative investment opportunities over the 12 months
from the date of this report.
As a consequence, the Directors believe that the Company has adequate
financial resources to continue its operational existence for at least 12
months from the date of the approval of these financial statements.
Accordingly, the Directors believe that it is appropriate to continue to adopt
the going concern basis in preparing the financial statements.
Share-based payments
The Company has determined that share options issued during the period meets
the definition of a share based payment under IFRS 2. In order to determine
the fair value of the options estimates were required for inputs into the
valuation model. More details of the estimates can be found in note 10.
5. OPERATING EXPENSES
Period 1 July 2022 to 30 June 2023 Period 28 May 2021 to 30 June 2022
GBP GBP
Legal and professional fees - cash settled 758,183 238,872
Legal and professional fees - share settled 50,000 -
Directors fees 210,430 87,756
Administration fees 95,975 49,635
Audit fees 15,000 -
Advisory fees 97,614 -
Listing fees 32,121 -
Reimbursement of expenses to directors 19,749 1,582
Insurance 16,458 18,207
Regulatory fees 19,569 500
Other operating expenses 8,069 186
Commission 6,500 -
Bank charges 2,983 613
1,332,651 397,351
6. OTHER CURRENT ASSETS
30 June 2023 30 June 2022
GBP GBP
Prepayments 9,657 5,192
Total 9,657 5,192
7. ACCOUNTS PAYABLE
30 June 2023 30 June 2022
GBP GBP
Administration fees 11,250 8,819
Audit fees 15,000 -
Legal and professional fees 66,961 20,042
Other accruals 6,249 20
Directors remuneration - 4,167
99,460 33,048
8. TAXATION
The Company is liable to tax at the standard Guernsey rate of 0%.
9. SHARE CAPITAL AND SHARE PREMIUM
Number of Ordinary Shares Ordinary Shares Share Premium Share based payments
GBP GBP GBP
On incorporation (GBP 1 each) 1 1 - -
Shares issued (no par value each) 16,750,000 - 586,000 -
Redemption (GBP 1 each) (1) (1) - -
Balance at 30 June 2022 16,750,000 - 586,000 -
Shares issued (no par value each) 3,010,000 - 1,455,000 50,000
Balance at 30 June 2023 19,760,000 - 2,041,000 50,000
On incorporation, the Company issued one redeemable preference share of
GBP1.00 at par for cash consideration of GBP1.00. On 29 July 2021, a
re-designation of one ordinary share to a redeemable share held by Tanglin
Capital Limited was executed and further redeemed by the Company.
On 16 June 2021, the Company agreed, immediately upon Admission, to issue to
Strand Hanson Limited a warrant (the "Warrant") (approved by the Company's
shareholders if applicable) to subscribe at any time during the three years
following the date of issue of the Warrant for an aggregate number of shares
equal to one per cent. Of the enlarged issued share capital of the Company
immediately prior to Admission at an exercise price equal to the issue price
applicable to the Transaction. The Company also agrees that the beneficial
interest in the Warrant may be freely assigned by Strand Hanson (in its sole
discretion) to any subsidiary or associated companies, shareholders, or
employees (note 10).
On 29 July 2021, Tanglin Capital Limited invested £10,000 into the Company as
cash consideration for 10,000,000 Ordinary Shares of no-par value. On 13
August 2021, an investment of £1,000 was made into the Company as cash
consideration for 1,000,000 Ordinary Shares of no-par value. These 1,000,000
Ordinary Shares were then transferred to Tanglin Capital Limited on 12
November 2021, and subsequently transferred to Oliver Stuart Fox on 12 April
2012.
On 20 August 2021, an initiation fee of GBP50,000 was paid to Strand Hanson
Limited in equity in the Company priced at the issue price per share
applicable to the round at which seed investors participate (i.e. GBP0.10
each), which equates to 500,000 Ordinary Shares.
On 23 August 2021, 19 November 2021 and 13 December 2021, the Company issued
3,000,000, 1,500,000 and 750,000 Ordinary Shares of no-par value respectively
at a price of £0.10 each in connection with the pre-IPO fundraising, raising
a total of GBP525,000.
During September 2022, the Company issued 3,010,000 Ordinary Shares of no-par
value respectively at a price of £0.50 each, raising a total of £1,455,000
after an equity based payment of £50,000 was paid to Strand Hanson Limited
and is included in legal costs.
10. SHARE-BASED PAYMENTS
Shares issues in the period:
On 15 September 2022 the Company issued 100,000 Ordinary Shares of no-par
value to Stand Hanson Limited. The fair value of the transaction was deemed to
£50,000 which was the number of shares issued multiplied by the share price
on listing and are included in legal costs for the period.
Options issued in the period:
On 8 September 2022 the Company issued a warrant to Strand Hanson Limited
which allows them or their assigned holder to subscribe to 197,600 shares at
any time up to 7 September 2025 to shares at an exercise price of 50p.
The Warrant was valued using the Black Scholes model and its fair value deemed
immaterial, as a result no value has been ascribed to the Warrant in these
financial statements. The estimates used to calculate the fair value is
detailed below:
Expected volatility 34.79%
Dividend Yield -
Risk free interest rate 3.23%
Expected exercise period 3 years from grant
Share price on date of grant 50p
11. EARNINGS PER ORDINARY SHARE
Basic Diluted
GBP GBP
Loss for the period (1,326,717) (1,326,717)
Weighted average number of shares 19,125,014 19,322,614
Earnings per share (0.07) (0.07)
Basic earnings per Ordinary Share is calculated by dividing the earnings
attributable to Shareholders by the weighted average number of Ordinary Shares
outstanding during the period.
Diluted earnings per share is calculated by adjusting the weighted average
number of Ordinary Shares outstanding to assume conversion of all dilutive
potential Ordinary Shares. As at 30 June 2023 there were 197,600 warrants
exercisable for Ordinary Shares outstanding. A fully diluted earnings per
Ordinary Share has not been presented as the company has reported a loss for
the period and as such the effect of the warrants outstanding at the reporting
date is anti-dilutive.
12. RELATED PARTY TRANSACTIONS
The directors' remuneration for Nicola Walker, Robert George Shepherd and
Oliver Stuart Fox for the period was GBP25,000, GBP25,000 and GBP160,430
respectively (2022: GBP4,167, GBP 4,167, GBP 20,706).
The directors received reimbursements in respect of travel and meeting
expenses and sundry office costs of GBP19,972 during the period (2022: GBP
1,582).
Andrew Roberto Mankiewicz was a director until 18 April 2022, and received
directors' fees GBP 57,333 in the prior period. Mr Andrew Roberto Mankiewicz
also received GBP59,174 (2022: nil) for advisory fees in the current period.
There have been no changes in the related parties transactions described in
the last annual report that could have a material effect on the financial
position or performance of the Company in the current financial period.
13. ULTIMATE CONTROLLING PARTY
The Company is controlled by Tanglin Capital Limited which is the Parent
company holding 50.61% of the issued Ordinary Shares, with Tanglin Capital
Limited ultimately controlled by Andrew Roberto Mankiewicz.
14. FINANCIAL RISK MANAGEMENT
The Company is exposed to a number of risks arising from the financial
instruments it holds. The main risks to which the Company is exposed are
market risk, credit risk and liquidity risk. The risk management policies
employed by the Company to manage these risks are discussed below as follows:
MARKET RISK
Market risk is the risk that changes in market prices such as equity prices,
interest rates and foreign exchange rates will affect the Company's income or
the value of its holdings of financial instruments. The objective of market
risk management is to manage and control market risk exposures within
acceptable parameters while optimising the return.
Price risk
The Company is not directly or indirectly exposed to any significant price
risk.
Interest rate risk
Interest rate risk is the risk that the fair value of future cash flows of a
financial instrument will fluctuate because of changes in market interest
rates. Interest rate risk arises on interest-bearing financial instruments
recognised in the Statement of Financial Position.
Cash and cash equivalents are interest bearing but not at significant levels.
Currency risk
The Company is exposed to currency risk arising from transactions in Singapore
Dollars. Consequently, the Company is exposed to the risk that the exchange
rate of its reporting currency relative to other foreign currencies may change
in a manner that has an adverse effect on the fair value or future cash flows
of the Company's financial assets or liabilities denominated in currencies
other than GBP.
The Company holds all assets in GBP and does not consider the risk to be
material to the financial statements.
CREDIT RISK
Credit risk is the risk of financial loss to the Company if a counterparty
fails to meet its contractual obligations. Credit risk arises from cash and
cash equivalents as well as outstanding receivables.
The Company assesses all counterparties for credit risk before contracting
with them. The credit risk on cash and cash equivalents is mitigated by
entering into transactions with counterparties that are regulated entities
subject to prudential supervision, with high credit ratings assigned by
international credit rating agencies. Cash and cash equivalents are held with
Barclays Bank plc, which at the period end was assigned a credit rating of A
by Standard and Poor's rating agency.
The maximum exposure to credit risk Is the carrying amount of the financial
assets set out below.
Period ended 30 June 2023 Period ended 30 June 2022
GBP GBP
Other current assets 9,657 5,192
Cash and cash equivalents 456,115 215,885
Total credit risk exposure 465,772 221,077
LIQUIDITY RISK
Liquidity risk is the risk that the Company will encounter difficulty in
meeting obligations associated with financial liabilities. This risk can arise
from mismatches in the timing of cash flows relating to assets and
liabilities. The Company receives funding from the shareholders and does not
have significant ad hoc expenses to settle. The only significant expense that
the Company is exposed to are general operating expenses.
The table below analyses the Company's financial assets and liabilities into
the relevant maturity groupings based on the remaining period at the reporting
date. The amounts in the table are the contractual undiscounted cash flows.
Balances due within 12 months equal their carrying balances, as the impact of
discounting is not significant.
As at 30 June 2023
Less than 1 month 1 to 12 months More than 12 months Total
Assets
Other current assets 9,657 - - 9,657
Cash and cash equivalents 56,115 - - 456,115
65,772 - - 465,772
Liabilities
Trade and other payables 99,460 - - 99,460
99,460 - - 99,460
As at 30 June 2022
Less than 1 month 1 to 12 months More than 12 months Total
Assets
Other current assets 5,192 - - 5,192
Cash and cash equivalents 215,885 - - 215,885
221,077 - - 221,077
Liabilities
Trade and other payables 33,048 - - 33,048
33,048 - - 33,048
15. SUBSEQUENT EVENTS
Convertible loan facility
Post period end, on 8 September 2023 the Company announced it had obtained an
unsecured committed facility of £1 million via a convertible loan note
instrument (the "Convertible Loan").
The Convertible Loan will be made available in three tranches over September
and October 2023 with an interest rate equating to a fixed amount of five per
cent. per annum.
Should the Convertible Loan not be repaid prior to the completion of the
Proposed Acquisition, all the outstanding principal amount and accrued
interest shall automatically convert into ordinary shares of no par value per
the terms disclosed in the announcement of 8 September 2023.
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