REG - Iconic Labs PLC - Full Year Results for the Year ended 30 June 2024
31/10/2024 16:00
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RNS Number : 4718K Iconic Labs PLC 31 October 2024
31 October 2024
Iconic Labs PLC
("Iconic" or the "Company")
Full Year Results for the Year ended 30 June 2024
Iconic Labs PLC (LSE: ICON), today announces its audited financial results
for the year ended 30 June 2024.
Copies of the Annual Report and Accounts for the year ended 30 June 2024 will
shortly be sent to shareholders and available on the Company's website:
https://www.iconiclabs.co.uk/documents/
(https://www.iconiclabs.co.uk/documents/) .
Period Highlights
· Prospectus published to provide the Company with the ability to
issue further Ordinary Shares under the Prospectus Regulation Rules
· Signed non-binding heads of terms with the owners of ITS Holdings
2023 Ltd ("ITS 2023"), the holding vehicle of the entire issued share capital
of In the Style Fashion Ltd ("ITSFL"), in connection with potential purchase
of ITS 2023 (although subsequently resolved instead for the Company to acquire
ITSFL directly from ITS 2023)
· Victor Humberdot and Béla Lendvai-Lintner appointed as
Non-executive Directors
Financial Highlights
· Profit of £418,948 (FY 23: £4,558,623) due to write back of
trade creditors in the year
· Revenue of £Nil (FY 23: £Nil)
· Total assets held as of 30 June 2024 £139,340 (FY 23: £50,244)
· Group liabilities of £2,857,383 (FY 23: £3,900,141)
John Farquharson, Interim Chief Executive Officer of Iconic Labs, commented:
"Since announcing the heads of terms to acquire ITFSL, the management team has
continued to advance the acquisition process, with the current intention to
complete the transaction before the end of the calendar year. We look forward
to providing updates in due course, which will culminate in the publication of
a prospectus if successful."
For any further information or enquiries please contact:
Iconic Labs via Yellow Jersey PR
John Farquharson, Interim Chief Executive Officer
Novum Securities Limited Tel: +44 (0) 20 7399 9400
David Coffman / Daniel Harris
Yellow Jersey PR Tel: +44 (0) 20 3004 9512
Charles Goodwin
Annabelle Wills iconic@yellowjerseypr.com
Bessie Elliot
CHIEF EXECUTIVE OFFICER'S REPORT
I am pleased to present the audited accounts of Iconic Labs PLC and its
subsidiaries (together, "Iconic" or the "Company") for the twelve months ended
30 June 2024.
Strategic Overview
Historically, Iconic has been a media and technology business focused on
developing ventures and identifying acquisitions in the online media,
artificial intelligence, and big data sectors. Our sole asset during this
period was Gay Star News ("GSN"), an online media platform dedicated to the
LGBTQ+ community. GSN continues to be part of our portfolio, championing
diversity and inclusion in the digital media space.
Following our successful exit from administration and completion of all
Company Voluntary Arrangement ("CVA") requirements on 21 September 2023, we
initially intended to develop a strategic advisory services business. This
venture aimed to provide fee-based services to technology companies in our
core sectors, advising on growth strategy, product development, social media,
marketing, and capital raising. However, unfavourable market conditions led us
to reassess this strategy. Recognising the need for a more viable path
forward, we redirected our efforts toward identifying a suitable acquisition
target that would align with our long-term objectives.
Proposed Acquisition of In The Style Fashion Limited
After an extensive review of potential targets and following the suspension of
our shares on 29 February 2024, on 11 March 2024 Iconic entered into
non-binding heads of terms with the sellers of ITS Holdings 2023 Ltd "(ITS
2023") the parent company of In The Style Fashion Limited ("ITSFL"), a leading
online fashion retailer
Founded in 2013, ITSFL is a dynamic e-commerce apparel brand with a loyal and
growing customer base of predominantly women aged 16 to 35. The company has
carved out a unique position in the market through its innovative influencer
collaboration model. By partnering with influencers who have high engagement
on social media platforms, ITSFL co-creates fashion collections that resonate
deeply with its target audience.
We are working with our advisers to undertake the due diligence necessary to
complete the proposed acquisition. As the transaction will constitute a
reverse takeover under the Listing Rules, our advisers are assisting us with
the process of readmission to the Official List and to trading on the Main
Market of the London Stock Exchange ("Readmission"). As a result of the due
diligence to date, it is now proposed that Iconic will acquire ITSFL directly
from ITS 2023 and will not acquire ITS 2023.
Looking Ahead
The coming year promises to be an exciting chapter in Iconic's evolution. The
completion of the proposed ITSFL acquisition will be a priority, and we are
committed to realising the full potential of the business. Our focus will be
on leveraging synergies, driving growth, and delivering sustainable
shareholder returns.
On behalf of the Board, I would like to express my gratitude to our
shareholders for their continued support and patience during this
transformative period. I would also like to thank our stakeholders for their
dedication and trust in our vision.
We look forward to updating you on our progress in the months ahead.
John Farquharson
Interim Chief Executive Officer
Date: 30 October 2024
STRATEGIC REPORT
INTRODUCTION
This is the eighth set of financial statements prepared by Iconic. This
Strategic Report should also be read in conjunction with the Chief Executive
Officer's Report.
Principal Activities
Iconic has entered into non-binding heads of terms with the sellers of ITS
Holdings 2023 Ltd, the parent company of In The Style Fashion Limited, a
leading online fashion retailer
Iconic's sole asset is Gay Star News ("GSN"), an online media platform
dedicated to the LGBTQ+ community.
PRINCIPAL RISKS AND UNCERTAINTIES
The following risks are considered by the Board to be the most significant to
the business:
Reverse Takeover (RTO) Target Risk
Iconic has identified and announced its target for a proposed RTO, however
there is a risk that the RTO will not complete. The Company continues to work
with its advisers to progress the legal and financial due diligence to enable
the RTO to proceed and will provide further updates in due course.
Going Concern Risk
If the proposed RTO is not successful and an alternative target is not found
within a short period of time, there is a risk that further funding will not
be available from the Financing Facility with EHGOSF, and that whilst the
on-going running cost of the Group is expected to be low, the Group may not be
able to meet its liabilities as they fall due.
Revenue, Profitability and Funding Risk
Iconic currently only has one asset, GSN, which is not cash-generative and
otherwise currently generates no revenues including from consultancy. The
Company has therefore been reliant upon the Financing Facility with EHGOSF for
its main source of working capital.
The Financing Facility is subject to a number of conditions ("Conditions")
including in particular:
· The shares of Iconic trade on the Main Market of the
London Stock Exchange;
· The closing market price of the Shares for each of
the ten consecutive trading days falling immediately prior to the relevant
closing date must be at least higher than 150% of the nominal value of
Iconic's shares;
· The average daily value traded of Iconic's shares
(excluding 5% of the data points from the top and excluding 5% of the data
points from the bottom of the data set) for the 20 trading days immediately
prior to the applicable closing date must be at least £10,000;
· From the fifth drawdown tranche onwards, Iconic
having published a Prospectus;
· No binding commitment has been entered into by Iconic
pursuant to which a change of control in Iconic would occur;
· No occurrence that constitutes an event of
default having occurred and is continuing;
· The Board having the required authority;
(1) For the allotment and issue of at least 200% of such number of Shares as
would be required upon conversion of all outstanding Notes together with the
Notes to be issued pursuant to the relevant drawdown notice calculated by
dividing the aggregate principal amount of all such Notes by the Closing VWAP
as of the date of such drawdown notice; and
(2) To deviate from the Shareholders' pre-emption and/or preferential
subscription right (as applicable) with respect to such number of Shares; and
· No payment is due by the Company to EHGOSF (or any of its
Affiliates) and no delivery of Shares (or certificates evidencing such Shares)
resulting from a conversion of Notes or exercise of any Warrants by EHGOSF (or
any of its Affiliates) is outstanding.
The Company has secured short-term funding from EHGOSF and the seller of ITSFL
to allow it to pursue the RTO which it is using to pay its low running costs
and advisers to progress the legal and financial due diligence.
In the event that the RTO is not successful, it is possible that some of these
conditions will not be met. As a result, if any such condition is not met, the
Company may not be in a position to further drawdown on the Financing
Facility. Although the Directors would endeavour to pursue certain options to
mitigate the consequence of such breach there is no certainty that any such
options could be achieved either in part or at all. In such an event the
Company would need to wind down its operations, realise any assets and may
enter administration, if and to the extent there are creditors of the Company
who cannot be paid. In such an event, the Company would no longer manage the
affairs of the Company or the realisation of its assets. As a result of either
winding down the business or entering into administration, the Ordinary Shares
would be cancelled from the Official List and Shareholders may receive little
or no value for their Ordinary Shares.
Dilution and Pricing Risk
If EHGOSF exercises its full rights under the Financing Facility for
conversion of Loan Notes and Warrants into Shares, this could result in a
significant holding in the Company by EHGOSF. However, EHGOSF's strategy is
generally to sell shares in the market as soon as practicable following the
exercise of such rights and in any event under the Financing Facility, inter
alia, EHGOSF cannot hold more than 29.9% of the Company. Accordingly, there is
a risk that should the Company seek to drawdown under the Loan Notes and
EHGOSF thereafter exercise and sell Shares in significant amounts over a
lengthy period, this could have a material negative impact on the price of the
Shares.
Potential Unrecorded Legacy Liabilities
As evidenced by the administration and disputes involving various key parties,
there were significant legacy issues that predated management's arrival.
Following the exit from administration and the entering into of confidential
settlement agreements with various parties, the Directors consider that it is
unlikely that there are any material unknown liabilities of Iconic, however
there is the potential for unknown creditors to emerge which would increase
the liabilities of the Company.
Financial Risk Management
The Board monitors the internal risk management function across Iconic and
advises on all relevant risk issues. There is regular communication with
internal departments, external advisors and regulators. Iconic's policies on
financial instruments and the risks pertaining to those instruments are set
out in the accounting policies in note 1 of the financial statements.
Key Performance Indicators
The business is currently focused on the areas of cash management and
operating results.
Iconic has identified the following key performance indicators which the
Directors will use to measure success against the business plan following the
reverse takeover:
· Gross revenue growth
· EBITDA growth
· Market value
FUTURE DEVELOPMENT AND STRATEGY
Company Strategy
As set in the August 2023 Prospectus, the Company had intended to resume its
historical revenue-generating offering by identifying companies in the online
media, artificial intelligence, and big data gathering, processing and
analysis sectors with which it could enter into advisory services contracts.
At the time, it was thought that such advisory services could provide the
Company with short-term revenues and news flow while it continued to search
for a suitable acquisition target.
However, given the limited number of personnel working with the Company, the
time commitment needed to properly provide advisory services to prospective
clients, and current unfavourable market conditions, the Company decided that
this short-term strategy was no longer viable. As such it decided to cease
this strategy in favour of focusing all of its time, resources, and energy on
acquiring a suitable company through an RTO to generate long-term growth and
value for its shareholders.
Going Concern
The Board's assessment of going concern and the key considerations are set out
in our Corporate Governance Report.
Capital Structure
Details of the Ordinary Shares of the Company are shown in note 11. On 13
February 2024 the Company's Ordinary Shares of £0.1 were subdivided into
Ordinary Shares of £0.0001 each and Deferred Shares of £0.999 each. The
Company also has a class of Deferred Shares of £0.00249 per share. No shares
are entitled to a fixed income. Each holder of Ordinary Shares is entitled to
receive Iconic's Annual Report and audited financial statements, to attend and
speak or appoint proxies and to exercise voting rights at Iconic's general
meetings.
The Company's Articles of Association (the "Articles") do not have any
specific restrictions on the transfer of shares or restrictions on voting
rights, and there are no limitations on holding such shares. Other than the
obligations contained in the Financing Facility, the Settlement Deed, and the
CVA, the Directors are not aware of any agreement between Iconic shareholders
that may result in restrictions on the transfer of securities or on voting
rights.
No person has any special rights of control over Iconic's share capital and
all issued shares are fully paid.
The appointment and replacement of Directors and the powers of the Directors
are governed by the Articles, the Quoted Companies Alliance Corporate
Governance Code, the Companies Act 2006 and related legislation. The powers of
the Directors are described in the Corporate Governance Report.
Environmental Issues
As far as the Directors are aware, Iconic's business activities do not cause a
direct and disproportionate adverse effect on the environment.
Employee Matters
As of 30 June 2024, and continuing through the fourth quarter of 2024, Iconic
did/does not have any employees and its management is being conducted
primarily by John Farquharson. Therefore, the Directors believe that this
information is not relevant for the year ended 30 June 2024 and have not
disclosed any information to that effect.
Social, Community and Human Rights Issues
Iconic seeks to achieve the highest ethical standards and behaviours in
conducting its business, with integrity, openness, diversity and inclusiveness
being a priority.
Section 172 Statement
Section 172 of the Companies Act 2006 requires directors to take into
consideration the interests of stakeholders and other matters in their
decision making. The Directors continue to have regard to the interests of
Iconic's personnel and other stakeholders, the impact of its activities on the
community, the environment and its reputation for good business conduct, when
making decisions. In this context, acting in good faith and fairly, the
directors consider what is most likely to promote the success of Iconic for
its members in the long term. We explain in this annual report, and below, how
the board engages with stakeholders.
Relations with key stakeholders such as employees, shareholders and suppliers
are considered in more detail in the Corporate Governance Report.
The Directors are aware of their responsibilities to promote the success of
Iconic in accordance with section 172 of the Companies Act 2006. To ensure
Iconic was operating in line with good corporate practice, all Directors
received refresher training on the scope and application of section 172 in
writing. This encouraged the Board to reflect on how Iconic engages with its
stakeholders and opportunities for enhancement in the future. A section 172
notice has been included with the Board papers since this date. As required,
Iconic's Company Secretary will provide support to the Board to help ensure
that sufficient consideration is given to issues relating to the matters set
out in s172(1)(a)-(f).
The Board regularly reviews Iconic's principal stakeholders and how It engages
with them. This is achieved through information provided by management and by
direct engagement with stakeholders themselves. We aim to work responsibly
with our stakeholders, including suppliers. The Board has recently reviewed
its anti-corruption and anti-bribery, equal opportunities and whistleblowing
policies.
The key events and Board decisions made in the year are set out below:
8 August 2023 - Publication of Prospectus.
25 August 2023 - AGM held and Ordinary Shares Consolidated.
15 September 2023 - 83,256 Ordinary Shares issued to all creditors under the
CVA.
12 October 2023 - Documents terminating CVA filed with and accepted by
Companies House.
13 February 2024 - AGM held and Ordinary Shares sub-divided and converted.
29 February 2024 - Suspension of trading in the shares and RNS confirmation
that Iconic was in discussions regarding a potential acquisition.
John Farquharson
Director
Date: 30 October 2024
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2024
Notes Year ended Year ended
30 June 30 June
2024 2023
(restated)
£ £
Revenue - -
Gross profit - -
Administrative expenses 3 418,948 4,558,579
Other operating income - 44
Operating Profit 418,948 4,558,623
Profit before taxation 418,948 4,558,623
Income tax expense 5 - -
Profit for the year 418,948 4,558,623
Total comprehensive profit for the year 418,948 4,558,623
Earnings per share attributable to equity shareholders of the Company 6
- Basic earnings per share 0.05 0.00
- Diluted earnings per share 0.01 0.00
The profit for the year and total comprehensive profit for the year are wholly
attributable to the equity holders of the parent.
The results above have been derived from continuing operations.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2024
30 June 30 June
2024 2023
Notes (restated)
£ £
Assets
Non-current assets
Intangible assets 7 1 1
Total non-current assets 1 1
Current assets
Trade and other receivables 9 10,030 -
Cash and cash equivalents 10 129,309 50,243
139,339 50,243
Total assets 139,340 50,244
Equity
Share capital 11 5,192,602 4,539,523
Share premium 12 8,401,588 8,341,761
Accumulated losses 12 (16,312,233) (16,731,181)
(2,718,043) (3,849,897)
Liabilities
Current liabilities
Trade and other payables 13 210,604 1,750,141
Loans and borrowings 14 2,646,779 2,150,000
2,857,383 3,900,141
Total liabilities 2,857,383 3,900,141
Total equity and liabilities 139,340 50,244
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2024
Share Share Accumulated Total
capital
£ premium losses Equity
£
£
£
Balance at 30 June 2022 4,450,506 7,900,778 (21,289,804) (8,938,520)
Profit for the period - - 4,768,623 4,768,623
Total comprehensive profit for the period
- - 4,768,623 4,768,623
Transactions with owners:
Issue of shares 89,017 440,983 530,000
Total contribution by and distribution to owners 89,017 440,983 530,000
Balance at 30 June 2023 as previously presented 4,539,523 8,341,761 (16,521,181) (3,639,897)
Prior period adjustment (note 16) - - (210,000) (210,000)
Balance at 30 June 2023 as restated 4,539,523 8,341,761 (16,731,181) (3,849,897)
Profit for the year - - 418,948 418,948
Total comprehensive profit for the year - - 418,948 418,948
Transactions with owners:
Issue of shares 653,079 59,827 - 712,906
Total contribution by and distribution to owners 653,079 59,827 - 712,906
Balance at 30 June 2024 5,192,602 8,401,588 (16,312,233) (2,718,043)
Share premium includes premiums on issue of share capital, less associated
issue costs.
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2024
Notes Year ended Year ended
30 June
2024 30 June
2023
(restated)
£ £
Cash flows from operating activities
Total comprehensive profit for the year 418,948 4,558,623
Costs relating to EHGOSF facility 310,006 -
Net write back of trade creditors (1,509,225) (6,117,482)
Net write back of loan notes - (915,000)
(780,271) (2,473,859)
Increase in trade and other receivables 9 (10,030) -
(Increase)/decrease in trade and other payables 13 (12,412) 1,554,097
Net cash used in operating activities (802,713) (919,762)
Cash flows from financing activities
Cash flows from issue for promissory notes 14 631,779 -
Cash flows from issue of convertible loan notes 14 250,000 970,000
Net cash flows from financing activities 881,779 970,000
Net increase in cash and cash equivalents 79,066 50,238
Cash and cash equivalents at beginning of year
50,243 5
Cash and cash equivalents at year end 10 129,309 50,243
COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2024
Notes 30 June 30 June
2024
2023
(restated)
£ £
Non-current assets
Investments 8 1 1
Non-current assets 1 1
Current assets
Trade and other receivables 9 10,030 -
Cash and cash equivalents 10 129,309 50,243
139,339 50,243
Total assets 139,340 50,244
Equity
Share capital 11 5,192,602 4,539,523
Share premium 12 8,401,588 8,341,761
Accumulated losses 12 (16,312,233) (16,731,181)
(2,718,043) (3,849,897)
Current liabilities
Trade and other payables 13 210,604 1,750,141
Loans and borrowings 14 2,646,779 2,150,000
2,857,383 3,900,141
Total liabilities 2,857,383 3,900,141
Total equity and liabilities 139,340 50,244
The Company's profit and total comprehensive profit for the year ended 30 June
2024 was £418,948 (restated 30 June 2023: £4,558,623 profit).
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2024
Share Share Accumulated Total
capital premium losses equity
£ £ £ £
Balance at 01 July 2023 4,450,506 7,900,778 (21,289,344) (8,938,060)
Profit for the period - - 4,768,163 4,768,163
Total comprehensive profit for period - - 4,768,163 4,768,163
Transactions with owners
Issue of shares 89,017 440,983 - 530,000
Total contributions by and distributions to owners 89,017 440,983 - 530,000
Balance at 30 June 2023 as originally presented 4,559,523 8,341,761 (16,521,181) (3,639,897)
Prior period adjustment (note 16) - - (210,000) (210,000)
Balance at 30 June 2023 as restated 4,559,523 8,341,761 (16,731,181) (3,849,897)
Balance at 01 July 2023 4,359,523 8,341,761 (16,731,181) (3,849,897)
Profit for the year - - 418,948 418,948
Total comprehensive profit for year - - 418,948 418,948
Transactions with owners
Issue of shares 653,079 59,827 - 712,906
Total contributions by and distributions to owners 653,079 59,827 - 712,906
Balance at 30 June 2024 5,192,602 8,401,588 (16,312,233) (2,718,043)
Share premium includes premiums on issue of share capital, less associated
issue costs.
1. Accounting Policies
Company information
The principal activity of ("the Company") is that of a holding company. The
Company is a public company limited by shares registered in England &
Wales. The registered office of the Company is 7 Bell Yard, London, WC2A 2JR.
The Company registration number is 10197256.
Basis of preparation
These financial statements have been prepared in accordance with applicable
law and UK Adopted International Accounting Standards ("UK Adopted IASs").
These consolidated financial statements are presented in Pounds Sterling
('GBP'), which is considered by the directors to be the functional and
presentation currency.
The Company's individual statement of comprehensive income has been omitted
from the Group's annual financial statements having taken advantage of the
exemption not to disclose under Section 408(3) of the Companies Act 2006.
Going concern
As noted in the Corporate Governance Report, the Directors have carefully
considered the financial position of Iconic in light of progress during the
twelve months ended 30 June 2024. The Directors have identified and
announced a target for a proposed RTO transaction and have secured short term
funding to progress the financial and legal due diligence, however there is a
risk that the transaction may not complete. If the proposed RTO is not
successful and an alternative target is not found within a short period of
time, there is a risk that further funding will not be available from the
Financing Facility with EHGOSF, and that whilst the on-going running costs of
the Group are expected to be low, the Group may not be able to meet its
liabilities as they fall due.
In such an event the Group would need to wind down its operations, realise any
assets and may enter administration, if and to the extent there are creditors
of the Company who cannot be paid. In such an event, the Group would no longer
manage its affairs or the realisation of its assets. As a result of either
winding down the business or entering into administration, the Ordinary Shares
would be cancelled from the Official List and Shareholders may receive little
or no value for their Ordinary Shares.
On this basis, there is a material uncertainty related to events or conditions
that may cast significant doubt on the Group's ability to continue as a going
concern and that it may therefore be unable to realise its assets and
discharge its liabilities in the normal course of business. The Directors
believe it remains appropriate to prepare the financial statements on a going
concern basis
Basis of consolidation
The Group financial statements consolidate those of the parent company and all
of its subsidiaries. Subsidiaries are entities controlled by the Group. The
parent company controls a subsidiary if it has power over the investee to
significantly direct the activities, exposure, or rights, to variable returns
from its involvement with the investee, and the ability to use its power over
the investee to affect the amount of the investors' returns. The financial
statements of subsidiaries are included in the consolidated financial
statements from the date that control commences until the date that control
ceases.
The results of subsidiaries acquired or disposed in the period are included in
the consolidated income statement from the effective date of acquisition or up
to the effective date of disposal, as appropriate. All intra-group
transactions, balances, income and expenses are eliminated on consolidation.
The results and net assets of subsidiaries whose accounts are denominated in
foreign currencies are retranslated into Sterling at average rates and
year-end rates respectively.
Where the Group has the power to participate in (but not control) the
financial and operating policy decisions of another entity, it is classified
as an associate. Associates are initially recognised in the consolidated
statement of financial position at cost. Subsequently associates are accounted
for using the equity method, where the Group's share of post-acquisition
profits and losses and other comprehensive income is recognised in the
consolidated statement of profit and loss and other comprehensive income
(except for losses in excess of the Group's investment in the associate unless
there is an obligation to make good those losses).
Taxation
The tax expense represents the sum of the tax currently payable and deferred
tax. The tax currently payable is based on taxable profit for the year.
Taxable profit differs from net profit as reported in the income statement
because it excludes items of income or expense that are taxable or deductible
in other years and it further excludes items that are never taxable or
deductible.
Deferred tax is the tax expected to be payable or recoverable on temporary
differences between the carrying amounts of assets and liabilities in the
financial statements and the corresponding tax bases used in the computation
of taxable profit, and is accounted for using the balance sheet liability
method. Deferred tax liabilities are generally 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. Such assets and liabilities
are not recognised if the temporary difference arises from goodwill or from
the initial recognition (other than in a business combination) of other assets
and liabilities in a transaction that affects neither the tax profit nor the
accounting profit.
Deferred tax liabilities are recognised for taxable temporary differences
arising on investments in subsidiaries and associates, and interests in joint
ventures, except where the Group is able to control the reversal of the
temporary difference and it is probable that the temporary difference will not
reverse in the foreseeable future.
The carrying amount of deferred tax assets is reviewed at each reporting date
and reduced to the extent that it is no longer probable that sufficient
taxable profits will be available to allow all or part of the asset to be
recovered.
Deferred tax is measured on an undiscounted basis using the tax rates that are
expected to apply in the period when the liability is settled or the asset is
realised. Deferred tax is charged or credited in the income statement, except
when it relates to items charged or credited directly to equity, in which case
the deferred tax is also dealt with in equity.
Intangible fixed assets
Intangible assets comprise capitalised computer software which are initially
recognised at cost.
Amortisation is provided so as to write off their carrying value over their
expected useful economic lives. It is provided at the following rates:
Computer Software 33% straight line basis
Intangible assets also comprise intellectual property which is initially
measured at cost. The useful economic life of the asset is considered to be
such that any amortisation charge would be immaterial to the financial
statements. The directors have therefore decided that an annual impairment
review rather than a systematic amortisation is more appropriate for this
asset.
Impairment of non-current assets
At each reporting date the Group reviews the carrying amounts of its property,
plant and equipment and intangible assets to determine whether there is any
indication that those assets have suffered an impairment loss. If any such
indication exists, the recoverable amount of the asset is estimated in order
to determine the extent of the impairment loss (if any).
If the recoverable amount of an asset is estimated to be less than its
carrying amount, the carrying amount of the asset is reduced to its
recoverable amount. An impairment loss is recognised as an expense
immediately, unless the relevant asset is carried at a revalued amount, in
which case the impairment loss is treated as a revaluation decrease.
Financial assets
Financial assets are recognised when the Group becomes a party to the
contractual provisions of the financial asset.
Financial assets are derecognised when the contractual rights to the cash
flows from the financial assets expire, or when the financial asset and
substantially all of the risks and rewards are transferred.
The financial assets of the Group are initially measured at fair value
adjusted for transaction costs (where applicable).
Financial assets are classified into the following categories:
- Amortised cost
- Fair value through profit or loss (FVTPL)
- Fair value through other comprehensive income (FVOCI)
The classification is determined by both:
- The Group's business model for managing the financial asset
- The contractual cash flow characteristics of the financial asset
All income and expenses relating to financial assets that are recognised in
profit or loss are presented within finance costs and finance income.
Financial assets are measured at amortised cost if the assets meet the
following conditions (and are not designated as FVTPL):
- They are held within a business model whose objective is to hold the
financial assets and collect its contractual cash flows
- The contractual terms of the financial assets give rise to cash
flows that are solely payments of principal and interest on the principal
amount outstanding
After initial recognition, these are measured at amortised cost using the
effective interest method. Discounting is omitted where its effect is
immaterial. The Group's cash and cash equivalents, trade and other receivables
fall into this category.
An impairment loss in respect of a financial asset measured at amortised cost
is calculated as the difference between its carrying amount and the present
value of the estimated future cash flows discounted at the asset's original
effective interest rate. Losses are recognised in profit or loss and reflected
in an allowance against trade and other receivables. When an event occurring
after the impairment was recognised causes the amount of impairment loss to
decrease, the decrease in impairment loss is reversed through profit or loss.
Trade and other receivables
The Group makes use of a simplified approach in accounting for trade and other
receivables and records the loss allowance as lifetime expected credit losses.
These are the expected shortfalls in contractual cash flows, considering the
potential for default at any point during the life of the financial
instrument. In calculating, the Group uses its historical experience, external
indicators and forward-looking information to calculate the expected credit
losses using a provision matrix.
The Group assesses impairment of trade and other receivables on a collective
basis.
Cash and cash equivalents
Cash and cash equivalents comprise cash balances and call deposits. These are
initially and subsequently recorded at fair value.
Financial liabilities
The Group's principal financial liabilities include trade and other payables,
leases and convertible debt none of which would be classified as fair value
through profit or loss.
Therefore, these financial liabilities are classified as financial liabilities
at amortised cost, as defined below:
Other financial liabilities include the following items:
· Borrowings are initially recognised at fair value net of any
transaction costs directly attributable to the issue of the instrument. Such
interest-bearing liabilities are subsequently measured at amortised cost using
the effective interest method, which ensures that any interest expense over
the period to repayment is at a constant rate on the balance of the liability
carried in the statement of financial position. Interest expense in this
context includes initial transaction costs and premium payable on redemption,
as well as any interest or coupon payable while the liability is outstanding.
· Trade payables and other short-term monetary liabilities, which
are initially recognised at fair value and subsequently carried at amortised
cost using the effective interest method.
Convertible loan notes
Convertible loan notes issued by the Group comprise loan notes that can be
converted to ordinary shares at the option of the holder. Convertible loan
notes are recognised on the balance sheet when the entity becomes a party to
the contractual provisions of the instrument and are measured at fair value
upon initial recognition
Convertible loan notes are classified as financial liabilities at amortised
cost unless they meet the criteria to be classified and measured at fair value
through profit or loss. Derecognition occurs when the loan notes are converted
to ordinary shares.
Promissory notes
Promissory notes are classified as financial instruments and recognised on the
balance sheet when the entity becomes a party to the contractual provisions of
the instrument. Upon initial recognition, promissory notes are measured at
fair value, typically the transaction price, plus any directly attributable
transaction costs. If a promissory note is issued with deferred payment terms
or at an interest rate that does not reflect the market rate, it is initially
measured at fair value, determined by discounting future cash flows at a
market rate of interest.
Promissory notes payable are classified as financial liabilities at amortised
cost unless they meet the criteria to be classified and measured at fair value
through profit or loss. Promissory notes payable classified at amortised cost
are subsequently measured using the effective interest rate method,
recognising interest expense over the term of the note. Derecognition occurs
when the obligation is discharged, cancelled, or expired.
Share capital
The Group's ordinary shares are classified as equity instruments.
Changes to IFRS not yet adopted
As from 1 January 2024, various amendments to IFRS standards as listed below
were issued but have not been applied in these financial statements. Their
adoption is not expected to have a material effect on the financial statements
of the Company and Group.
The following UK-adopted IFRSs have been issued but have not been applied in
these financial statements. Their adoption is not expected to have a material
effect on the financial statements:
· Amendments to IFRS 16 Leases: Lease Liability in a Sale and
Leaseback (effective 1 January 2024).
· Amendments to IAS 1 Presentation of Financial Statements:
Classification of Liabilities as Current or Non-current and Non-current
liabilities with Covenants (effective 1 January 2024).
· Amendments to IAS 7 Statement of Cash Flows and IFRS 7 Financial
Instruments: Disclosures: Supplier Finance Arrangements (effective 1 January
2024).
The following standards and interpretations to published standards are not yet
effective:
· Amendments to IAS 21: Lack of exchangeability (endorsed -
effective 1 January 2025).
· Amendments to IFRS 9 and IFRS 7: Classification and Measurement
of Financial Instruments (issued - effective 1 January 2026)
· IFRS 18: Presentation and Disclosure in Financial Statements
(issued - effective 1 January 2027)
· Amendments to IFRS 10 and IAS 28: Sale or Contribution of Assets
between an Investor and its Associate or Joint Venture (deferred).
The Directors anticipate that the adoption of these standards and
interpretations in future periods will not have an impact on the results and
net assets of the Company and Group.
2. Significant judgements and key sources of estimation uncertainty
The Group makes certain estimates and assumptions regarding the future.
Estimates and judgements are continually evaluated based on historical
experience and other factors, including expectations of future events that are
believed to be reasonable under the circumstances. In the future, actual
experience may differ from these estimates and assumptions. Significant
management judgements are as follows:
Legacy Issues
· Due to the change in the Board, key management and operations of
the Group that took place in March 2021, it is possible that there are
unrecorded liabilities relating to discontinued activities about which the
Board is unaware. The Board has undertaken, to the extent possible, a thorough
review of the creditor position of the Parent Company and the Group, with a
core focus on the legacy business operations. Notwithstanding the Board's
assessment, there is a residual risk unforeseen liabilities may arise.
However,
due to the publicity around the new business, shutting down the old one and
drawing down on the EHGOSF facility, a number of claims were made against the
company. While it is important to consider these liabilities in these accounts
the Board has however made a judgment that the risk of unrecorded actual or
contingent liabilities is now low.
· The Group's former Board under through its Cellplan subsidiary was
promoting bespoke stem cell medical insurance and launched a website to market
the product. After due enquiry, the new Board is not aware that any such
policies were issued. There does however remain a residual risk that policies
may have been issued. The Board considers that the incidence and financial
impact is now low.
3. Profit from Operations
Year ended Year ended
30 June
30 June
2023
2024
(restated)
£
£
The loss for the period is stated after charging:
Auditors' remuneration - audit services 29,000 30,000
Expenses by nature: £ £
Legal and professional fees 646,958 802,578
Consultancy fees 168,375 433,368
Other supplies and external services 274,944 322,957
Total operating expenses 1,090,277 1,558,903
Creditors written off (1,509,225) (6,117,482)
Total administrative expenses (418,948) (4,558,579)
4. Staff Costs
No wages were paid during this year or the previous year.
Employee Numbers
The average number of staff employed by the group during the period amounted
to:
General and administration 4 3
4 3
Key management personnel compensation
Key management personnel are those persons having authority and responsibility
for planning, directing and controlling the activities, and are the directors
of the Company.
Remuneration of the directors and highest paid director is shown in the
Remuneration Committee Report.
5. Income tax expense
Year ended Year ended
30 June 2024
30 June 2023
£
£
Current tax - -
Total current tax - -
The reason for the difference between the actual tax charge for the period and
the standard rate of corporation tax in the United Kingdom applied to losses
for the period are as follows:
Year ended Year ended
30 June 2024
30 June 2023
£ (restated)
£
Profit before taxation 418,948 4,558,623
Tax using the parent company's domestic tax rate of 25% (2023: 19%) 104,737 866,138
Effects of:
Utilisation of tax losses and other deductions arising in the period (104,737) (866,138)
Total tax charged in the income statement - -
The deferred taxation has not been recognised in these accounts due to the
uncertainty over whether this will be recovered.
6. Earnings per share
Year ended Year ended
30 June 2024
30 June 2023
£ (restated)
£
Basic earnings per share
Numerator
Profit for the year 418,948 4,558,623
Denominator
Weighted average number of ordinary shares used in basic earnings per share
(units)
8,784,726 46,306,916,660
Basic earnings per share 0.05 0.00
Diluted earnings per share
Numerator
Profit for the year 418,948 4,558,623
Denominator
Weighted average number of ordinary shares used in basic earnings per share
(units)
8,784,726 46,306,916,660
Impact of potential dilutive shares (units) 20,150,000 19,400,000
Adjusted weighted average number of shares (units) 28,934,726 46,326,316,660
Diluted earnings per share 0.01 0.00
7. Intangible Assets
Intellectual Property
£ Total
£
Cost
Balance at 30 June 2023 21,600 21,600
Additions - -
Balance at 30 June 2024 21,600 21,600
Amortisation
Balance at 30 June 2023 21,599 21,599
Impairment - -
Balance at 30 June 2024 21,599 21,599
Carrying amounts
Balance at 30 June 2024 1 1
Balance at 30 June 2023 1 1
8. Investments Company
30 June 30 June
2024 2023
£ £
Investments in subsidiaries 1 1
1 1
Subsidiaries as at 30 June 2024:
Country of incorporation Nature of business
Entity Registered office address Notes
WideCells International Limited PO Box 4385, 09962594: COMPANIES HOUSE DEFAULT ADDRESS, Cardiff, CF14 8LH United Kingdom Holding company (c) (d)
WideCells Portugal SA Rua Da Casa Branca, 97 Coimbra 3030-109, Portugal Portugal Dormant company (a)
WideCells Espana SL Calle Castillo de Fuensaldana, 4, 28232 Las Rozas, Madrid Spain In liquidation (a)
CellPlan Limited PO Box 4385, 09962594: COMPANIES HOUSE DEFAULT ADDRESS, Cardiff, CF14 8LH United Kingdom Dormant company (a) (d)
CellPlan International Lda Edificio Tower Plaza Rotunda Eng, Edgar Cardoso, no. 23, 11 F, 4400-676 Vila Portugal Dormant company (b) (d)
Nova de Gaia, Portugal
Nuuco Media Limited PO Box 4385, 09962594: COMPANIES HOUSE DEFAULT ADDRESS, Cardiff, CF14 8LH United Kingdom Dormant company (c) (d)
Notes: (a) 100% owned by WideCells International Limited
(b) 100% owned by CellPlan Limited
(c) 100% owned by Iconic Labs plc
(d) Ordinary Shares Held
9. Trade and other receivables
Group
30 June 30 June
2024
2023
£
£
Prepayments and accrued income 10,030 -
Total 10,030 -
Company
30 June 30 June
2024
2023
£
£
Prepayments and accrued income 10,030 -
Total 10,030 -
10. Cash and cash equivalents
Group
30 June 30 June
2023
2024
£
£
Cash at bank available on demand 129,309 50,243
Total cash and cash equivalents 129,309 50,243
Company
30 June 30 June
2023
2024
£
£
Cash at bank available on demand 129,309 50,243
Total cash and cash equivalents 129,309 50,243
11. Company Share Capital
30 June 2024 30 June 2023
Number £ Number £
Authorised, allotted and fully paid - classified as equity
Ordinary shares of £0.10 each 1,116,148 463,069
(2023 - £0.00001 each) 11,161,483 46,306,916,660
Deferred shares of £0.00249 each 1,637,129,905 4,076,454 1,637,129,905 4,076,454
Total 1,648,291,388 5,192,602 47,944,046,565 4,539,523
At 30 June 2023, the Company had 46,306,916,660 Ordinary shares of £0.00001
in issue and 1,637,129,905 Deferred shares of £0.00249 in issue.
In August 2023, the Company issued 689,655,172 Ordinary shares of £0.00001
for £0.000039 each in respect of a conversion of loan notes by EHGOSF.
Following the share issue above, the Company undertook a share consolidation.
For every 10,000 £0.0001 Ordinary shares held, the shareholder received 1
Ordinary share of £0.10. In order to facilitate this consolidation, the
Company had to issue 8,168 Ordinary shares of £0.0001 prior to the
consolidation.
In September 2023, the Company issued 220,361 Ordinary shares of £0.10 each
for £0.23 each, 236,406 were issued for £0.13 each and 271,739 were issued
for £0.11 each. These issues were all in respect of the conversion of loan
notes by EHGOSF. The Company also issued 83,256 Ordinary shares at par, to
creditors as part of the CVA arrangement.
In October 2023, the Company issued 1,508,110 Ordinary shares of £0.10 each
at par, in respect of the conversion of £130,000 loan notes by EHGOSF, and
related conversion fees.
In November 2023, the Company issued 1,022,490 Ordinary shares of £0.10 each
at par, in respect of the conversion of £50,000 loan notes by EHGOSF, and
related conversion fees. Also in November 2023, the Company issued 769,043
Ordinary shares of £0.10 each at par, in respect of the conversion of
£35,000 loan notes by Arch Capital Partners LLP, and related conversion fees.
In December 2023, the Company issued 1,495,720 Ordinary shares of £0.10 each
at par, in respect of the conversion of £70,000 loan notes by EHGOSF, and
related conversion fees.
In February 2024, the company issued 854,700 Ordinary shares of £0.10 each at
par, in respect of the conversion of £20,000 loan notes by EHGOSF, and
related conversion fees.
At 30 June 2024, the Company had 11,161,483 Ordinary shares of £0.10 in issue
and 1,637,129,905 Deferred shares of £0.00249 in issue.
In accordance with the Companies Act 2006, the Company has no limit on its
authorised share capital.
The holders of Ordinary shares have full voting, dividend and capital
distribution rights. The Ordinary shares do not confer any rights of
redemption.
On or following the occurrence of a change of control the receipts from the
acquirer shall be applied to the holders of the Ordinary shares pro rata to
their respective holdings.
Ordinary shares and Deferred Shares are recorded as equity.
At 30 June 2024 the Company had issued 11,125,000,000 (2023: 6,125,000,000)
warrants to EHGOSF at a strike price of £0.00003 (2023: £0.00003) per share.
All warrants remain outstanding at the year-end date.
12. Reserves
The following describes the nature and purpose of each reserve within equity:
Reserve Description and purpose
Share premium Amount subscribed for share capital in excess of nominal value
Accumulated losses All other net gains and losses and transactions with owners (e.g. dividends)
not recognised elsewhere
13. Trade and other payables
Group
30 June 30 June
2024
2023
£
£
Trade payables 135,289 1,704,142
Accruals 75,315 45,999
Total 210,604 1,750,141
Book values approximate to fair values at 30 June 2024 and 30 June 2023.
Company
30 June 30 June
2024
2023
£
£
Trade payables 135,289 1,704,142
Accruals 75,315 45,999
210,604 1,750,141
Book values approximate to fair values at 30 June 2024 and 30 June 2023.
14. Loans and borrowings
Group
30 June 30 June
2023
2024
£ (restated)
Current
£
Promissory notes 631,779 -
Convertible loans 2,015,000 2,150,000
Total 2,646,779 2,150,000
Book values approximate to fair values at 30 June 2024 and 30 June 2023.
During the current year, the Company issued promissory notes of £325,460 to
EHGOSF to provide working capital. In addition, the Company issued a further
£306,319 of promissory notes to allow it to progress the legal and financial
due diligence to enable the RTO to proceed.
During the prior year, the Company entered into a financing facility with
EHGOSF for the issue of up to £3m of further convertible loan notes. At the
year end the Company had drawn down £1,480,000 of the facility of which
£930,000 had been converted into shares and fees of £260,000 had been
deducted. This facility is unsecured.
Company
30 June 30 June
2023
2024
(restated)
Current £
£
Promissory notes 631,779 -
Convertible loans 2,015,000 2,150,000
Total 2,646,779 2,150,000
15. Financial Instruments - Risk Management
The Group is exposed through its operations to the following financial risks:
· Credit risk
· Market risk
· Liquidity risk
In common with other businesses, the Group is exposed to risks that arise from
use of financial instruments. This note describes the group's objectives,
policies and processes for managing those risks and the methods used to
measure them.
The principal financial instruments used by the Group, from which the
financial instrument risks arise, are as follows:
· Cash and cash equivalents
· Trade and other receivables
· Trade and other payables
· Loans and borrowings
A summary of the financial instruments held by category is provided below:
· Financial assets - amortised cost
· Financial liabilities - amortised cost
The contractual maturities for all financial instruments held by the company
are shown in the table below. The table shows undiscounted principal and
interest cash flows and includes contractual gross cash flows and the net debt
reconciliation:
Carrying value Falling due within 1 year Falling due in more than 1 year but not more than 5 years Total
£ £ £ £
2024
Financial liabilities: current and non-current
Trade and other payables 210,604 210,604 - 210,604
Promissory notes 631,779 631,779 631,779
Convertible loan notes 2,015,000 2,015,000 - 2,015,000
Total financial liabilities 2,857,383 2,857,383 - 2,857,383
Financial assets: current and non-current
Trade and other receivables 10,030 10,030 - 10,030
Cash and cash equivalents 129,309 129,309 - 129,309
Total financial assets 139,339 139,339 - 139,339
Net debt (2,718,044) (2,718,044) - (2,718,044)
2023 (restated)
Carrying value Falling due within 1 year Falling due in more than 1 year but not more than 5 years Total
Financial liabilities: current and non-current
Trade and other payables 1,750,141 1,750,141 - 1,750,141
Convertible loan notes 2,150,000 2,150,000 - 2,150,000
Other loans - - - -
Total financial liabilities 3,900,141 3,900,141 - 3,900,141
Financial assets: current and non-current
Trade and other receivables - - - -
Cash and cash equivalents 50,243 50,243 - 50,243
Total financial assets 50,243 50,243 - 50,243
Net debt (3,849,898) (3,849,898) - (3,849,898)
Financial assets and financial liabilities have been analysed by category
below:
Carrying value Financial assets at fair value through profit or loss Financial assets at fair value through other comprehensive income Liability at amortised cost Financial asset at amortised cost Fair value hierarchy level
£ £ £ £ £
Financial assets
Trade & other receivables 10,030 - - - 10,030 Level 2
Cash & cash equivalents 129,309 - - - 129,309 Level 1
Financial liabilities
Promissory notes 631,779 - - 631,779 - Level 2
Convertible loan notes 2,015,000 - - 2,015,000 - Level 2
Trade & other payables 210,604 - - 210,604 - Level 2
Level 1 - Fair value determined by reference to prices in active markets for
identical assets/liabilities
Level 2 - Fair value determined by reference to internal model with observable
inputs
Group:
2024 2023
£ £
Cash and cash equivalents 129,309 50,243
Trade and other receivables 10,030 -
Total financial assets - amortised cost 139,339 50,243
2024 2023
(restated)
£ £
Trade and other payables 210,604 1,750,141
Loans and borrowings 2,646,779 2,150,000
Total liabilities - amortised cost 2,857,383 3,900,141
Company: 2024 2023
£ £
Cash and cash equivalents 129,309 50,243
Trade and other receivables 10,030 -
Total financial assets - amortised cost 139,339 50,243
2024 2023
(restated)
£ £
Trade and other payables 210,604 1,750,141
Loans and borrowings 2,646,779 2,150,000
Total liabilities - amortised cost 2,857,383 3,900,141
The Board has overall responsibility for the determination of the Group's risk
management objectives and policies.
The overall objective of the Board is to set policies that seek to reduce risk
as far as possible without unduly affecting the Groups' competitiveness and
flexibility. Further details regarding these policies are set out below:
Credit risk
The Group applies the simplified approach when measuring expected credit
losses. The approach uses a lifetime expected loss allowance. The expected
loss rates are reviewed annually, or when there is a significant change in
external factors potentially impacting credit risk and are updated where
management's expectations of credit losses change. No changes have been made
to the expected loss rates during the financial year.
Financial assets held as at year-end are as shown below (2023: £nil):
As at 31 March 2024
Current More than 1 year overdue Total
£
£ £
Prepayments and accrued income 10,030 - -
Gross carrying amount 10,030 - 10,030
Credit risk (Continued)
No expected credit losses have been provided against the financial assets in
the current year and prior year.
Credit risk is the risk of financial loss to the Group if a counterparty to
the financial instrument fails to meet its contractual obligations. It is
Group policy to assess the credit risk of new customers before entering into
contracts.
Credit risk also arises from cash and cash equivalents and deposits with banks
and financial institutions. For banks and financial institutions, only
independently rated parties with high credit status are accepted.
The Group does not enter into derivatives to manage credit risk.
Group
2024 2023
£ £
Trade and other receivables 10,030 -
Cash held at Wise Payments Limited 129,309 50,243
Total financial assets 139,339 50,243
Company
2024 2023
£ £
Trade and other receivables 10,030 -
Cash held at Wise Payments Limited 129,309 50,243
Total financial assets 139,339 50,243
Market risk
Foreign exchange risk
Foreign exchange risk arises because the Group has operations in Portugal and
Spain, whose functional currency is not the same as the functional currency of
the Group. The Group's net assets arising from such overseas operations are
exposed to currency risk resulting in gains or losses on retranslation into
sterling.
As of 30 June 2024, the Group's exposure to foreign exchange risk was not
material as the overseas operations had been discontinued.
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 Board will continue to monitor long term cash projections and will
consider raising funds as required.
The following table sets out the contractual maturities (representing
undiscounted contractual cash-flows) of financial liabilities:
Group:
Up to Between Between Between Over 5 years Total
3 months 3 and 12 1 and 2 2 and 5 years
months years £ £
2024 £ £ £ £
Trade and other payables 210,604 - - - - 210,604
Borrowings 2,646,779 - - - - 2,646,779
Total 2,857,383 - - - - 2,857,383
Up to Between Between Between Over 5 years Total
3 months 3 and 12 1 and 2 2 and 5 years
months years £ £
2023 (restated) £ £ £ £
Trade and other payables 1,750,141 - - - - 1,750,141
Borrowings 2,150,000 - - - - 2,150,000
Total 3,900,141 - - - - 3,900,141
More details in regard to the line items are included in the respective notes:
· Trade and other payables - note 13
· Loan and borrowings - note 14
At the balance sheet date, the Group had liabilities due for settlement within
3 months of £2,857,383, compared to a cash balance of £129,309.
£2,015,000 of borrowings re convertible loan notes and £631,779 of
promissory notes which are to be settled by way of an issue of share capital.
The Group monitors capital which comprises all components of equity (i.e.
share capital, share premium and accumulated deficit).
The directors are aware of the need for the Group to obtain capital in order
to fund the growth of the business and are in continual discussions with
providers of both debt and equity capital. The directors regularly review the
status of such discussions and aim at all times to have offers of capital
funding available to the Company which more than exceed the needs of the
Company over the coming period.
In the medium term and in addition to the need to safeguard the entity's
ability to continue as a going concern, the directors are aware of the views
of members on certain financing structures and therefore have set an objective
to move towards a conventional, simplified capital structure based on equity
capital.
Further details about the directors' assessment of the Group's ability to
continue as a going concern and the key considerations there to are set out in
the Corporate Governance Report.
At present the directors do not intend to pay dividends but will reconsider
the position in future periods, as the Group becomes profitable.
16. Prior period adjustment
During the preparation of these financial statements, the Group identified an
error where fees incurred on the draw down of convertible loan notes were
omitted from the accounting records and financial statements in the prior
year. As a result of this error, convertible loan notes, reported within loans
and borrowings in the Consolidated Statement of Financial Position, were
understated by £210,000. Legal and waiver fees reported within administrative
expenses in the Consolidated Statement of Comprehensive Income were also
understated by £210,000.
The table below summarises the effect of the correction of the prior period
error on the financial statement.
Impact on Consolidated Statement of Financial
Position
As at 30 June 2023
As previously reported Adjustment to correct error Restated balance
£ £ £
Liabilities
Current liabilities
Loans and borrowings (1,940,000) (210,000) (2,150,000)
Equity
Accumulated losses (16,521,181) (210,000) (16,731,181)
Impact on Consolidated Statement of Profit or Loss and
Other Comprehensive
Income
For the year ended 30 June 2023
As previously reported Adjustment to correct error Restated balance
£ £ £
Administration expenses 4,768,579 (210,000) 4,558,579
Profit before taxation 4,768,579 (210,000) 4,558,579
The above errors have been corrected by restating the affected amounts in the
prior period financial statements, as if the errors had never occurred in
accordance with IAS 8. The restated figures are reflected in the comparative
amounts for the period ended 30 June 2023 in these financial statements.
17. Capital commitments
The Group had no capital commitments at 30 June 2024 or 30 June 2023.
18. Related party Transactions
Details of Directors' remuneration are given in the Remuneration Committee
Report.
19. Contingent Liabilities
The Company has contingent liabilities amounting to £255,000 that are payable
to advisors upon completion of the reverse takeover and re-admission to
trading. Should the reverse takeover not be successful, this amount is not
payable.
The Group had no contingent liabilities at 30 June 2023.
20. Ultimate Controlling Party
The Directors do not consider that there is an ultimate controlling party of
Iconic Labs Plc.
21. Reconciliation of movement in net (debt)/cash
Repayment of borrowings
Non-cash change in loan notes (continuing activities)
Net debt at 01 July 2023 Conversion of loan notes to equity Net cash
Cash flow at 30 June 2024
£ £ £ £ £ £
Cash at bank and in hand 50,243 79,066 - - - 129,309
Borrowings (2,150,000) (881,779) (260,000) - 435,000 (2,646,779)
Total financial liabilities (2,099,757) (802,713) (260,000) - 435,000 (2,517,470)
Repayment of borrowings
(continuing activities) Conversion of loan notes to equity
Net debt at 01 July 2022 Non-cash change in loan notes Net cash
Cash flow at 30 June 2023
(restated) (restated)
£ £ £ £ £ £
Cash at bank and in hand 5 50,238 - - - 50,243
Borrowings (2,415,000) (970,000) 705,000 - 530,000 (2,150,000)
Total financial liabilities (2,414,995) (919,762) 705,000 - 530,000 (2,099,757)
22. Subsequent Events
On 29 July 2024, the Listing Rules were replaced by the UK Listing Rules
("UKLR") under which the existing Standard Listing category was replaced by
the Equity Shares (shell companies) category under Chapter 13 of the UKLR as
it applied to the Company. Consequently, with effect from that date the
Company is admitted to Equity Shares (shell companies) category of the
Official List under Chapter 13 of the UKLR and to trading on the London Stock
Exchange's Main Market for listed securities.
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