REG - Ikigai Ventures Ltd - Unaudited Interim Results
29/03/2023 11:45
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RNS Number : 6379U Ikigai Ventures Limited 29 March 2023
29 March 2023
IKIGAI VENTURES LIMITED
("Ikigai" or the "Company")
Unaudited Interim Results
Ikigai, (LON:IKIV) an investment company established to acquire businesses
focused on having a strong positive social impact, announces its unaudited
interim results for the six months ended 31 December 2022.
For further information please contact:
Ikigai Ventures Limited Via IFC
Nick Bryan-Brown, CEO
Cosign Limited (Company Secretary) +44 (0)1481 211 000
Amit Taylor
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
DIRECTORS' REPORT
FOR THE SIX MONTH PERIOD FROM 01 JULY 2022 TO 31 DECEMBER 2022
The directors submit the half year report and unaudited financial statements
of Ikigai Ventures Limited (the "Company") which is incorporated in Guernsey,
for the six month period ended 31 December 2022.
PRINCIPAL ACTIVITY
The principal activity of the Company is that of an investment company
established to acquire businesses focused on having a strong positive social
impact. There has been no change in the activity of the Company during the
period.
PUBLIC LISTING
During the period the company was admitted to the main market for listed
securities of the London Stock Exchange under the ticker symbol "IKIV" with
shares registered with an ISIN of GG00BPG8J619 and SEDOL of BPG8J61. The
Company issued 4,180,000 Ordinary Shares on admission raising GBP2,090,000 to
pursue the Company's strategy through paying the costs of admission, the costs
of due diligence associated with a potential acquisition and to pay towards
the costs of re-admission on an acquisition.
BUSINESS UPDATE
Since its listing, the Company has actively sought potential international
acquisition targets both in Asia and in Europe. Companies operating in a range
of sectors have been reviewed and early stage discussions have been held with
a number of them, including businesses operating in the energy transition,
waste recycling and surgical devices sectors.
Financial and equity market conditions remain challenging and the Company has
continued to take soundings from the investment community in order to match
investor appetite with the opportunities available.
Our investment focus remains relatively wide within the broader ESG market
segment and we will continue to seek out and develop attractive potential
acquisition targets and will provide further information to shareholders when
appropriate.
DIVIDENDS
The directors do not recommend the payment of a dividend.
RESULTS
The results of the Company for the six month period ended 31 December 2022 are
shown in the Statement of Comprehensive Income.
RISK FACTORS
Market conditions
Current volatile financial and equity market conditions represent a potential
threat to the ability of the Company to complete the acquisition of a suitable
target company and secure readmission.
Challenges in acquiring a suitable target
The Company's strategy and future success is dependent to a significant extent
on its ability to identify a suitable acquisition opportunity and to execute a
reverse takeover of the chosen acquisition target on attractive terms
consistent with the Company's strategy. The Company cannot currently predict
the period of time it will take to identify a suitable acquisition. If a
target is not identified within 18 months of the Placement, further funds may
need to be raised. As at 31 December 2022, Ikigai's unaudited net assets were
£1,414,928 and its cash at bank was £1,441,043.
Russia/Ukraine
The Company has not been directly impacted by the current war in Ukraine nor
by the sanctions imposed on the Russian Federation but may face inflationary
pressure as a result of the worldwide impact on global economies.
DIRECTORS
The directors of the Company during the period and for the period to the date
these financial statements were signed were as follows:
Mr Ashley Charles Paxton
Mrs Meriel Catherine Lenfestey
Mr Nicholas Harris Bryan-Brown
UNAUDITED STATUS
These interim financial statements are not audited.
DIRECTORS' RESPONSIBILITIES
FOR THE SIX MONTH PERIOD FROM 1 JULY 2022 TO 31 DECEMBER 2022
The directors are responsible for preparing financial statements for each
financial period which give a true and fair view, in accordance with the
applicable Guernsey law and International Financial Reporting Standards
("IFRS") of the state of affairs of the Company and of the profit or loss of
the Company for that period.
In preparing these financial statements, the directors are required to:
i) select suitable accounting policies and then apply them consistently;
ii) make judgements and accounting estimates that are reasonable and prudent;
iii) state whether applicable IFRS accounting standards have been followed, subject
to any material departures disclosed and explained in the financial
statements; and
iv) prepare the financial statements on the going concern basis unless it is
inappropriate to presume that the Company will continue in business.
The directors confirm that they have complied with the above requirements in
preparing the financial statements.
The directors are responsible for keeping proper accounting records that
disclose with reasonable accuracy at any time the financial position of the
Company and enable them to ensure that the financial statements comply with
the Companies (Guernsey) Law, 2008. They are also responsible for safeguarding
the assets of the Company and hence for taking reasonable steps for the
prevention and detection of fraud and other irregularities.
The directors confirm that, to the best of their knowledge:
- The condensed set of financial statements, which have been prepared in
accordance with IFRS, give a true and fair view of the assets, liabilities,
financial position and loss of the Company
- The interim management report includes a fair review of the important events
and risks required by DTR 4.2.7 R and a fair review of the material related
party transactions required by DTR 4.2.8 R
APPROVED BY THE BOARD OF DIRECTORS
Nicholas Bryan-Brown Ashley Paxton Meriel Lenfestey
Director Director Director
29 March 2023
STATEMENT OF COMPREHENSIVE INCOME
FOR THE SIX MONTH PERIOD FROM 01 JULY 2022 TO 31 DECEMBER 2022
Six months to Six months to
31 December 2022 31 December 2021
Notes GBP GBP GBP GBP
INCOME
Bank interest 5,282 -
5,282 -
EXPENSES
Administration fees 55,524 37,082
Legal and professional fees 197,153 222,505
Annual registration fees 250 -
Directors' remuneration 69,228 1,384
Insurance 11,499 5,850
Commission fees 6,500 -
Bank charges 795 160
Sundry expenses 2,406 945
343,355 267,926
OPERATING LOSS GBP (338,073) GBP (267,926)
(Loss) / profit on foreign exchange (1,376) 3
COMPREHENSIVE LOSS FOR THE PERIOD GBP (339,449) GBP (267,923)
EARNINGS PER SHARE:
Loss per share GBP (0.02) GBP (0.02)
Diluted loss per share GBP (0.02) GBP (0.02)
There were no items of other comprehensive income during the period,
accordingly, only a single statement of comprehensive income is presented.
STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2022
As at As at
Notes 31 December 2022 30 June 2022
GBP GBP GBP GBP
CURRENT ASSETS
Other current assets 4 15,400 8,376
Cash and cash equivalents 1,441,043 116,157
1,456,443 124,533
CURRENT LIABILITIES
Trade and other payables 5 41,515 143,023
41,515 143,023
NET CURRENT ASSETS / (LIABILITIES) 1,414,928 (18,490)
NET ASSETS / (LIABILITIES) GBP 1,414,928 GBP (18,490)
CAPITAL AND RESERVES
SHARE CAPITAL 7 - -
SHARE PREMIUM 7 2,333,867 561,000
ACCUMULATED LOSSES (918,939) (579,490)
GBP 1,414,928 GBP (18,490)
STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTH PERIOD FROM 01 JULY 2022 TO 31 DECEMBER 2022
Share Capital Share Premium Accumulated Losses Total Equity
Notes GBP GBP GBP GBP
AT 01 JULY 2021 - - - -
Issued shares 7 - 560,000 - 560,000
Loss for the period - - (267,923) (267,923)
AT 31 DECEMBER 2021 - 560,000 (267,923) 292,077
AT 01 JULY 2022 - 561,000 (579,490) (18,490)
Issued shares 7 - 2,090,000 - 2,090,000
Costs attributable to issue of shares 7 - (317,133) - (317,133)
Loss for the period - - (339,449) (339,449)
AT 31 DECEMBER 2022 - 2,333,867 (918,939) 1,414,928
STATEMENT OF CASH FLOWS
FOR THE SIX MONTH PERIOD FROM 01 JULY 2022 TO 31 DECEMBER 2022
Six months to Six months to
31 December 2022
31 December 2021
GBP EUR
CASH FLOWS FROM OPERATING ACTIVITIES
Total comprehensive loss for the period (339,449) (267,923)
Adjustments for:
Share-based payment charge - 50,000
(Increase) in other current assets (7,024) (18,050)
(Decrease)/increase in trade and other payables (101,508) 140,018
NET CASH USED IN OPERATING ACTIVITIES (447,981) (95,955)
NET CASH USED IN INVESTING ACTIVITIES - -
CASH FLOWS FROM FINANCING ACTIVITIES
Net proceeds from issuance of share capital 1,772,867 510,000
NET CASH GENERATED FROM FINANCING ACTIVITIES 1,772,867 510,000
NET CHANGE IN CASH AND CASH EQUIVALENTS 1,324,886 414,045
Cash and cash equivalents at the beginning of the period 116,157 -
CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD 1,441,043 414,045
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTH PERIOD FROM 01 JULY 2022 TO 31 DECEMBER 2022
1. General Information
Ikigai Ventures Limited (the "Company") is a private company limited by shares
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 Martello Court, Admiral Park, St Peter Port, Guernsey,
GY1 3HB and the Company's registration number is 69265. On 15 September 2022
the company was admitted to the main market for listed securities of the
London Stock Exchange under the ticker symbol "IKIV" with shares registered
with an ISIN of GG00BPG8J619 and SEDOL of BPG8J61.
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 International Financial Reporting Standards ("IFRS") which include
standards and interpretations approved by the International Accounting
Standards Board, including International Accounting Standards ("IAS") and
interpretations issued by the International Financial Reporting
Interpretations Committee who replaced the Standards Interpretations
Committee.
2. Basis of accounting
The financial statements have been prepared under the historical cost
convention, modified to include certain items at fair value, and in accordance
with International Financial Reporting Standards ("IFRS") which includes
standards and interpretations approved by the International Accounting
Standards Board.
The functional and presentation currency of these financial statements is
Pounds Sterling.
The principal accounting policies are summarised below. They have all been
applied consistently throughout the period and to the preceding period.
Significant Accounting Policies
2.1 Financial Instruments
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 includes 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
Debtors 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 Group 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 includes 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.
2.2 Equity
Share capital represents the nominal value of shares that have been issued.
Equity-settled share-based payment 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.
2.3 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.
2.4 Taxation
The Company is liable to tax at the standard Guernsey rate of 0%.
2.5 Going Concern
The financial statements have been prepared using the going concern basis of
accounting as the directors are comfortable that the Company will continue as
a going concern for a period of at least 12 months from 31 December 2022.
COVID-19
The directors continue to monitor the repercussions of the COVID-19 pandemic
on any potential impact on the future financial performance of the Company. At
the date of signing these financial statements, whilst acknowledging that the
pandemic is still active, the directors do not believe that this will have a
significant financial impact on the Company in the medium to long term which
will prevent the Company from continuing to use the going concern basis of
accounting.
Russia/Ukraine
The Company has not been directly impacted by the current war in Ukraine nor
by the sanctions imposed on the Russian Federation but may face inflationary
pressure as a result of the worldwide impact on global economies.
3. Critical Accounting Estimates And Judgements In Applying Accounting
Policies
The preparation of financial statements requires the use of accounting
estimates which, by definition, will seldom equal the actual results.
Management also needs to exercise judgement in applying the Company's
accounting policies.
4. Other Current Assets
Six months to Six months to
31 December 2022 30 June 2022
GBP GBP
Prepayments 15,400 8,376
15,400 8,376
5. Trade And Other Payables
Six months to Six months to
31 December 2022 30 June 2022
GBP GBP
Administration fees 40,747 11,353
Directors' remuneration - 16,451
Legal and professional fees 393 115,199
Sundry expenses 375 20
41,515 143,023
6. Taxation
The Company is subject to Guernsey income tax at 0%.
7. Share Capital and Share Premium
Number of ordinary shares Ordinary shares Share Premium Total
GBP GBP GBP
On incorporation (of £1.00 each) 1 1 - 1
Issue share capital (no par value each) 15,500,000 - 560,000 560,000
Redemption (of £1.00 each) (1) (1) - (1)
31 December 2021 15,500,000 - 560,000 560,000
Issue share capital (no par value each) 1,000,000 - 1,000 1,000
30 June 2022 16,500,000 - 561,000 561,000
Issue share capital (no par value each) 4,180,000 - 2,090,000 2,090,000
Costs attributable to issue of shares - - (317,133) (317,133)
31 December 2022 20,680,000 - 2,333,867 2,333,867
On incorporation, the Company issued 1 ordinary Subscriber Share of GBP1 at
par of GBP1. On 29 July 2021, it was resolved to re-designate the sole
ordinary share of GBP1 par value issued to Tanglin Capital Limited upon the
formation of the Company as a redeemable share, and to redeem the Subscriber
Share for GBP1.
On 29 July 2021, Tanglin Capital Limited invested GBP10,000 into the Company
as cash consideration for 10,000,000 ordinary shares of no par value at a
price of GBP0.001 per share.
On 20 August 2021 and 8 September 2021, the Company issued 3,000,000 and
2,000,000 Ordinary Shares of no par value at a price of GBP0.10 per share in
connection with the pre-IPO fundraising, raising a total of GBP500,000.
On 20 August 2021 the Company issued Strand Hanson Limited GBP50,000 in equity
as an initiation fee which equates to 500,000 ordinary Shares of no par value
at a price of GBP0.10 per share. The Company also agreed, on admission, to
issue a Warrant to Strand Hanson Limited 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. The Warrant can be freely assigned by Strand Hanson Limited to any
subsidiary or associated company, shareholders or employees.
On 05 April 2022 Nicholas Harris Bryan-Brown invested GBP1,000 into the
Company as cash consideration for 1,000,000 ordinary shares of no par value at
a price of GBP0.001 per share.
On 15 September 2022 and on admission to the main market for listed securities
of the London Stock Exchange, the Company issued 4,180,000 Ordinary Shares of
no par value respectively at a price of £0.50 each, raising a total of
GBP2,090,000.
During the period, the Directors allocated GBP317,133 of costs directly
attributable to the issue of shares against Share Premium.
8. Earnings Per Ordinary Share
Period ended
31 December 2022
GBP
Earnings Weighted average of number of shares Per-share amount
GBP
Earning attributable to Shareholders (339,449) 18,930,761 (0.02)
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 31 December 2022 (and in accordance with the
Warrant issued to Strand Hanson on 20 August 2021 as disclosed in note 7),
there were 206,800 warrants outstanding which represented 1% of the number of
Ordinary Shares in issue. The fully diluted loss per share attributable to
Shareholders (assuming conversion of all dilutive potential Ordinary Shares)
as at 31 December 2022 was GBP0.02.
9. Related Party Transactions
The directors' remuneration for Mr Ashley Charles Paxton, Mrs Meriel Catherine
Lenfestey and Mr Nicholas Bryan-Brown of the period was GBP12,500 and
GBP12,500 and GBP44,228 respectively.
Mr Nicholas Bryan-Brown and Mr Andrew Roberto Mankiewicz OBE have also
received GBP5,658 and GBP20,831 respectively as reimbursement of travel and
meeting expenses and legal and professional fees paid on behalf of the company
during the period to 31 December 2022.
10. Ultimate Controlling Party
The Company is ultimately controlled by Tanglin Capital Limited which is the
Parent company, with Tanglin Capital Limited ultimately controlled by Mr
Andrew Roberto Mankiewicz OBE.
11. 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:
11.1.1 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 trade and other payables
denominated in United States 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.
11.1.2 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 year 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.
Six months to Six months to
31 December 2022 30 June 2022
GBP GBP
Other current assets 15,400 8,376
Cash and cash equivalents 1,441,043 116,157
Total credit risk exposure 1,456,443 124,533
11.1.3 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 31 December 2022 Less than 1 month/on demand 1-12 months More than 12 months Total
Assets
Other current assets 15,400 - - 15,400
Cash and cash equivalents 1,441,043 - - 1,441,043
1,456,443 - - 1,456,443
Liabilities
Trade and other payables 41,515 - - 41,515
41,515 - - 41,515
11.2 Capital Risk Management
The capital of the Company is represented by the net assets attributable to
the equity shareholder. The Company's objective when managing capital is to
safeguard the ability to continue as a going concern in order to provide
returns for the shareholder and benefits for other stakeholders.
The Board of Directors and the shareholders monitor capital on the basis of
the value of net assets attributable to the equity shareholders.
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