REG - Intuitive Invests.Gp - Half-year Report
25/05/2022 07:00
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RNS Number : 6487M Intuitive Investments Group plc 25 May 2022
25 May 2022
Intuitive Investments Group plc
Interim report for the period from incorporation to 31 March 2022
Intuitive Investments Group plc (AIM: IIG) ("IIG" or the "Company"), a
closed-end investment company focussed on the life sciences sector, announces
its interim results for the six months to 31 March 2022.
Financial highlights
31 March 2022 30 September 2021 31 March 2021 Flotation
Net Assets 12.33 million 8.14 million 7.90 million 7.59 million
Investments 10.40 million 5.74 million 3.93 million NA
Cash 1.91 million 2.57 million 3.90 million 7.59 million
NAV per share 18.73p 20.14p 19.55p 18.78p
% Increase/(decrease) from previous period end (6.96)% 2.99% 4.12% NA
Operational highlights
· Acquisition of Touchless Innovation Limited, including the wholly owned
subsidiary Touch-Less Hygiene UK Limited and the business and assets of
Sanoserv International Franchising Limited (trading as Sanondaf) for the
initial consideration of 28.8 million new ordinary shares and £1 million in
cash.
· Subscription to raise £607,000 by the issue of 2.76 million new
ordinary shares at a price of 22 pence per share, principally subscribed for
by directors of IIG.
· Appointment of Julian Baines MBE as Non-Executive Chairman with David
Evans moving to chair of the Investment Committee.
· Investment in Ocutec Limited, a private company in the late-stage
portfolio at a cost of £250,000.
For further information, please contact:
Intuitive Investments Group plc www.iigplc.com (http://www.iigplc.com/)
Julian Baines, Non-Executive Chairman Via Walbrook PR
Robert Naylor, CEO
SP Angel Corporate Finance LLP - Nominated Adviser +44 (0) 20 3470 0470
Jeff Keating / David Hignell / Kasia Brzozowska
Turner Pope Investments (TPI) Ltd - Broker +44 (0) 20 3657 0050
Andrew Thacker / James Pope
Walbrook PR Limited - Media & Investor Relations +44 (0)20 7933 8780 or intuitive@walbrookpr.com
(mailto:intuitive@walbrookpr.com)
Paul McManus/ Sam Allen +44 (0) 7980 541 893 / +44 (0) 7502 558 258
About Intuitive Investments Group plc
The Company is an investment company seeking to provide investors with
exposure to a portfolio concentrating on fast growing and/or high potential
Life Sciences businesses operating predominantly in the UK, continental Europe
and the US, utilising the Board's experience and in particular that of the
chairman of the Investment Committee, David Evans, to seek to generate capital
growth over the long term for shareholders.
Chairman and Chief Executive's Report
We are pleased to present the interim report for Intuitive Investments Group
plc, which covers the six months ended 31 March 2022. Overall, the period
under review has been one of notable progress, particularly in the unquoted
portfolio, with the acquisition of Touchless Innovation Limited including the
wholly owned subsidiary Touch-Less Hygiene UK Limited and the business and
assets of Sanoserv International Franchising Limited (trading as Sanondaf)
("Sanondaf") and an investment into Ocutec Limited ("Ocutec"). The publicly
traded portfolio, however, has not performed well, except for Light Science
Technologies plc which at the period end was valued at £1.49 million, a
premium to the £1 million we initially invested. We believe that the publicly
traded portfolio is undervalued and in the medium-term there is the potential
for good returns from these investments.
Evolution of strategy and acquisition of Sanondaf
As noted in our year end results, we found the interpretation of aspects of
the regulatory framework had constrained our ability to take advantage of
certain opportunities. Therefore, we shifted the Company's strategic focus to
take larger stakes in companies, which was resoundingly endorsed by
Shareholders at IIG's Annual General Meeting in December 2021.
We acquired Sanondaf in February 2022. The initial aggregate consideration for
Sanondaf was the issue of 28.8 million new ordinary shares of 1 penny each
("Ordinary Share") and £1 million in cash, with deferred consideration of
£900,000 payable six months from completion and an earn out of 30% of US
profits for the three years from completion. The consideration shares were
issued in two tranches, with the second tranche requiring a waiver under Rule
9 of the Code on Takeovers and Mergers. Again, with the support of
Shareholders, we were able to achieve this via an accelerated Rule 9 waiver,
which had the benefits of significant cost and time savings.
Sanondaf is by far the largest investment in IIG's portfolio, therefore we
will provide separate updates by RNS as to this investment's progress.
Sanondaf is a market-leading provider of specialist disinfection and
decontamination services operating in 10 countries and has 25 regional sites
in the UK. Sanondaf's core technology is spraying and fogging of a hydrogen
peroxide formula, which is administered as a dry vapour disinfection treatment
which can be used on all electrical and electronic devices and all hard and
soft furnishings safely, without causing damage or leaving any unsightly
residue on the surfaces treated.
Sanondaf's strategy is to grow by increasing services to existing customers
and focussing on specific sectors including life science, transport and heavy
engineering. In addition, Sanondaf is developing a pipeline of innovative
products around its fogging technology and an anatomical tissue processing
technology. This growth strategy will be supported nationally by selling
regional franchises in the UK and internationally by selling country master
franchises globally. The strategic goal of Sanondaf is to become a market
leader in professional decontamination, disinfection and anatomical waste
management in the countries in which it operates, principally by organic
growth.
As a franchise-based business, we believe sales and market share can be
increased significantly without the need for large amounts of capital
investment. However, we expect, in the short term, cash generated in Sanondaf
will be used firstly to meet the deferred consideration of £900,000 payable
to the vendors of the business and assets of Sanoserv International
Franchising Limited and secondly to invest into Sanondaf's infrastructure,
product development and working capital. As such there will not be
distributions from Sanondaf to IIG in the near term.
Other unquoted investments
We also invested £250,000 in Ocutec, representing a 6.04%. interest in
Ocutec's enlarged share capital, as part of a £1.36 million fundraising
round. Ocutec has patented technology covering the formulation of novel
contact lens products, contact lens comfort solutions and injection moulding
technology for rapid manufacturing. Ocutec is based in Glasgow, and has been
operating since 2006, having been spun out of the University of Strathclyde.
The unquoted portfolio continues, in the main, to be held at cost, plus
accrued interest if applicable, or the valuation of the most recent investment
round. Both Axol Bioscience Limited and Momentum Limited have raised
additional capital, but this is at the same valuation as the round in which
IIG participated and therefore there is no increase or decrease in valuation.
We are aware of three investee companies currently raising capital which may
provide an uplift in their valuations. Further details of the companies in the
unquoted portfolio are contained at the end of this statement.
Publicly traded investments as 31 March 2022
Valuation as at Unrealised gain/(loss)
31 March 2022 30 September 2021
£ £ £
Evgen Pharma plc 76,344 126,955 (50,611)
Light Science Technologies Holding plc 1,491,344 1,406,060 85,284
Microsaic Systems plc 192,000 442,000 (250,000)
Midatech Pharma plc 44,450 91,000 (46,550)
Polarean Imaging plc 270,000 429,166 (159,166)
Shield Therapeutics plc 164,120 325,032 (160,912)
Trellus Health plc 82,663 294,984 (212,321)
Yourgene Health plc 127,428 221,889 (94,461)
Closing fair value 2,448,349 3,337,086 (888,737)
In the small cap healthcare sector, during the early part of the Covid-19
pandemic, we saw many fundraisings, inflated trading volumes and some
valuations pushed to excessive levels, particularly those companies with a
Covid-19 related exposure. We do not perceive that any of our investments
achieved excessive valuations. The subsequent sell off has been
indiscriminate, with many investors reducing their exposure to the sector.
Inevitably our own portfolio has not been immune to this decline in the small
cap healthcare sector. Overall, we believe that the publicly traded portfolio
is undervalued and in the medium-term there is potential for excellent returns
from these investments. In context, during the period under review the AIM
All-Share (AXX) and Nasdaq Biotechnology (NBI) indices fell by 15.3% and 16.6%
respectively and have continued to materially decline post the period end.
Financial performance
NAV per Ordinary Share at flotation: 18.78 pence; 30 September 2021: 20.14
pence; 31 March 2022: 18.73 pence. There are investment losses of £696,000,
comprising unrealised losses of £889,000, interest income from the
convertible loan notes of £99,000, gains on realisation of publicly traded
companies of £76,000 and management fee income of £18,000.
The structure of the Company is purposefully simple, and the administrative
costs of the business were £195,000 for the period. Overall, the loss for the
period was £717,000. Given the size of the Company, the Board does not
propose to declare a dividend.
During the period there was a subscription to raise £607,000 by the issue of
2,759,091 new Ordinary Shares at a price of 22 pence per share, of which
£423,000 was subscribed for by Directors of IIG.
Outlook
Given our current cash position and in the absence of realisations, we do not
anticipate making new investments. We may make follow on investment in some of
our existing investments. We are clearly focussed on realising value from our
existing portfolio, in particular our investment in Sanondaf, which we
perceive, in the medium term, will be the best driver of shareholder value. We
look forward to updating you as to our progress.
Later stage investments
BioQ Pharma Incorporated ("BioQ") (www.bioqpharma.com
(http://www.bioqpharma.com) )
Investment of US$1 million by way of unsecured convertible loan notes and
warrants, valued at cost plus accrued interest. 6.65% of NAV as at 31 March
2022.
BioQ is a well-established, commercial-stage, medical device and
pharmaceutical company, addressing the infusible drugs market. BioQ's
proprietary Invenious(TM) platform comprises a "connect-and-go" drug-device
system combination, which can be utilised to improve the delivery of infusible
medicines. BioQ's platform includes a bespoke unit-dose delivery solution for
infusible drugs, whereby a diluent delivery system and administration line are
combined in one self-contained, ready-to-use presentation. The key benefits of
the platform include reduced cost and complexity compared to current infusion
techniques.
Ocutec Limited ("Ocutec") (www.ocutec.com (http://www.ocutec.com) )
Investment of £250,000 in ordinary shares, held at fair value, for which cost
is deemed the most appropriate basis of measurement. 2.03% of NAV as at 31
March 2022.
As noted above Ocutec has patented technology covering the formulation of
novel contact lens products, contact lens comfort solutions and injection
moulding technology for rapid manufacturing.
Touchless Innovations Limited ("Sanondaf") (www.sanondaf.co.uk
(http://www.sanondaf.co.uk) )
Investment of £5.3 million to acquire the entire issued share capital, held
at fair value, for which cost is deemed the most appropriate basis of
measurement. 43.11% of NAV as at 31 March 2022.
As noted above Sanondaf is a market-leading provider of specialist
disinfection and decontamination services operating in 10 countries and has 25
regional sites in the UK. Treatments are non-corrosive, contain no toxic
ingredients and Sanondaf's application methods ensure they are not harmful to
people, animals or the environment. It is safe for use in all settings,
including operating theatres, critical care units, and is CASA (Civil Aviation
Safety Authority) approved. Sanondaf's disinfection formula has proven
efficacy against pathogens, included, viruses, mould, bacteria and fungi.
Series A and B investments
Axol Bioscience Ltd ("Axol") (www.axolbio.com (http://www.axolbio.com) )
Investment of £249,091 in A ordinary shares, held at fair value, for which
cost is deemed the most appropriate basis of measurement. 2.02% of NAV as at
31 March 2022.
Axol produces high quality human cell products, particularly in relation to
pluripotent stem cell (hiPSC) and critical reagents such as media and growth
supplements, which are sold to medical research and drug discovery
organisations. Axol also provides contract research for example customising
cell lines for customers, such as reprogramming and differentiation. The
Chairman of Axol is Jonathan Milner, who is the company's co-founder and was
previously deputy chairman of Abcam plc.
CardiNor AS ("CardiNor") (www.cardinor.com (http://www.cardinor.com) )
Investment of £125,002 in ordinary shares, held at fair value, for which cost
is deemed the most appropriate basis of measurement. 1.01% of NAV as at 31
March 2022.
CardiNor is a Norwegian biotech company established in June 2015 to
commercialise the development of secretoneurin ("SN"), an important new
biomarker for cardiovascular disease ("CVD"). SN is the only biomarker shown
to be associated with biological processes linked to cardiomyocyte handling.
This unique biological function explains why SN presents as an independent and
strong predictor of mortality in all major patient cohorts, including
ventricular arrhythmia, acute heart failure, acute respiratory failure
patients with CVD and severe sepsis. CardiNor has completed development of a
research assay based on immunoassay technology to measure SN in blood and the
assay is under further clinical development, including to obtain a CE mark.
The Electrospinning Company Ltd ("TECL") (www.electrospinning.co.uk
(http://www.electrospinning.co.uk) )
Investment of £500,000 in ordinary shares, held at fair value, for which cost
is deemed the most appropriate basis of measurement. 4.06% of NAV as at 31
March 2022.
TECL has a technology platform built around the process of electrospinning, a
technique for production of micro and nano-fibre biomaterials from a variety
of natural and synthetic polymers, and a suite of post-processing technologies
to convert the biomaterials into medical device components. The core business
is the sale of product development and manufacturing services to medical
device companies. TECL is also using its know-how to develop proprietary
materials for targeted out-licensing opportunities, aiming to capture more of
the end-market value created by its innovations and expertise.
Micrima Ltd ("Micrima") (www.micrima.com (http://www.micrima.com) )
Investment of £200,000 by way of convertible loan note held at fair value,
for which cost is deemed the most appropriate basis of measurement. 1.75% of
NAV as at 31 March 2022.
Micrima is a commercial stage company which has developed a new imaging
method, the MARIA® system, based on radiofrequency technology to improve
early diagnosis of breast cancer. Micrima has reached a significant
development milestone with its novel breast imaging technology. Micrima is now
set to embark on commercial launch.
Momentum Bioscience Ltd ("Momentum") (www.momentumbio.co.uk
(http://www.momentumbio.co.uk) )
Investment of £125,000 in preferred A ordinary shares, held at fair value,
for which cost is deemed the most appropriate basis of measurement. 1.01% of
NAV as at 31 March 2022.
Momentum is developing a revolutionary rapid diagnostic test for patients
suspected of sepsis, an infection of the blood stream resulting in symptoms
including a drop in a blood pressure, increase in heart rate and fever.
Momentum's SepsiSTAT® system enables reporting of the presence or absence and
'pan gram identification' of viable organisms in just two hours, helping
direct the right antimicrobials. The system also provides a pure concentrate
of growing organisms for further analysis. Faster testing in suspected sepsis
patients can reduce mortality, accelerate hospital discharge, lower hospital
costs, and reduce pressure on antimicrobial resistance. SepsiSTAT® is a
diagnostic test that runs from a sample of whole blood before any culturing
steps are taken and is currently being studied in clinical practice with
highly encouraging early results indicating competitive sensitivity versus the
current standard of care. Over 120 million blood tests for sepsis are run
annually representing a market potential of over £1 billion.
PneumoWave Ltd ("PneumoWave") (www.pneumowave.com (http://www.pneumowave.com)
)
Investment of £350,000 in new ordinary shares, held at fair value, for which
cost is deemed the most appropriate basis of measurement. 2.84% of NAV as at
31 March 2022.
The investment in PneumoWave allowed for the company to nominate a director to
the board. Dr Stewart White, Chair of IIG's Advisory Panel was appointed
director on 31 March 2021. All fees paid by PneumoWave are remitted to the
company and shown as management fees in the statement of comprehensive income.
PneumoWave, which was incorporated in February 2018, is developing an
innovative remote respiratory monitoring platform comprising a small,
chest-worn biosensor and AI-driven data analysis/alerting software for the
early detection, prediction, and prevention of adverse events in respiratory
patients, both in hospitals and at home. In 2020, PneumoWave was awarded the
Breakthrough Medical Device designation from the U.S. Food and Drug
Administration for the development of the device, which is designed to monitor
breathing in real-time to a clinical standard of care.
The specially designed wireless biosensor is one of the smallest available and
transmits data to the cloud using a data hub or smartphone, alerting the
patient, their household members, doctor, nurse, or emergency services where
life-threatening changes occur. PneumoWave's technology will be able to
accurately monitor large numbers of patients in any location at any time.
Intuitive Investments Group Plc
Statement of Comprehensive Income
For the 6 months to 31 March
2022
6 months to Period to Period to
31 March 31 March 30 September
2022 2021 2021
Unaudited Unaudited Audited
£ £ £
Investment income
Finance income 98,954 29,981 110,344
Gains on realised investments 75,831 - 89,876
(Losses)/Gains on investments at fair value (888,737) 422,220 821,214
Management Fees 18,141 - 34,084
─────── ─────── ───────
(695,811) 452,201 1,055,518
Administrative expenses (194,558) (127,363) (324,153)
─────── ─────── ───────
(Loss)/Profit before tax (890,369) 324,838 731,365
Corporation tax 173,853 - (170,447)
─────── ─────── ───────
(Loss)/Profit for the period (716,516) 324,838 560,918
Other Comprehensive Income - - -
─────── ─────── ───────
Total comprehensive income for the period (716,516) 324,838 560,918
═══════ ═══════ ═══════
Total comprehensive income attributable to the owners of the company (716,516) 324,838 560,918
═══════ ═══════ ═══════
Profit/(Loss) per share
Basic - pence 4 (1.49)p 0.80p 2.22p
Diluted - pence (1.49)p 0.77p 2.22p
═══════ ═══════ ═══════
Intuitive Investments Group Plc
Statement of Financial Position
As at 31 March 2022
Notes As at As at As at
31 March 2022 31 March 2021 30 September 2021
Unaudited Unaudited Audited
ASSETS £ £ £
Non-current assets
Investments 5 10,398,155 3,933,074 5,737,353
Deferred tax asset 94,328 - 10,221
─────── ─────── ───────
10,492,483 3,933,074 5,747,574
─────── ─────── ───────
CURRENT ASSETS
Trade and other receivables 42,530 91,294 42,345
Cash and cash equivalents 1,910,883 3,903,376 2,566,793
─────── ─────── ───────
1,953,413 3,994,670 2,609,138
─────── ─────── ───────
TOTAL ASSETS 12,445,896 7,927,744 8,356,712
═══════ ═══════ ═══════
EQUITY
Shareholders' Equity
Called up share capital 6 657,903 404,192 404,418
Deferred shares 47,500 47,500 47,500
Share premium 11,631,228 7,125,361 6,985,736
Other reserves 144,399 - 144,399
Accumulated profit/(loss) (155,598) 324,838 560,918
─────── ─────── ───────
Total Equity 12,325,432 7,901,891 8,142,971
─────── ─────── ───────
LIABILITIES
Current liabilities
Trade and other payables 29,542 25,853 33,073
Non current liabilities
Deferred tax liabilities 90,922 - 180,668
─────── ─────── ───────
TOTAL LIABILITIES 120,464 25,853 213,741
─────── ─────── ───────
─────── ─────── ───────
TOTAL EQUITY AND LIABILITIES 12,445,896 7,927,744 8,356,712
═══════ ═══════ ═══════
Net asset value per share 18.73p 19.55p 20.14p
Intuitive Investments Group Plc
Statement of Changes in Equity
For 6 months to 31 March 2022
Called up Deferred Shares Share Other Reserves Retained Earnings Total
Share Premium Equity
Capital
£ £ £ £ £ £
Balance at 11 June 2020 - - - - - -
Profit for the period - - - - 324,838 324,838
Issued share during the period 404,192 47,500 7,632,148 - - 8,083,840
Finance costs - - (506,787) - - (506,787)
────── ────── ─────── ────── ────── ───────
Balance at 31 March 2021 404,192 47,500 7,125,361 - 324,838 7,901,891
Profit for the period - - - - 236,080 236,080
Warrants on admission - - (144,399) 144,399 - -
Issued share during the period 226 - 4,774 - - 5,000
────── ────── ─────── ────── ────── ───────
Balance at 30 September 2021 404,418 47,500 6,985,736 144,399 560,918 8,142,971
Loss for the period - - - - (716,516) (716,516)
Issued share during the period 253,485 - 4,645,492 - - 4,898,977
────── ────── ─────── ────── ────── ───────
657,903 47,500 11,631,228 144,399 (155,598) 12,325,432
────── ────── ─────── ────── ────── ───────
Intuitive Investments Group Plc
Statement of Cash Flows
For the 6 months to 31 March 2022
Notes 6 Months to Period to Period to
31 March 31 March 30 September
2022 2021 2021
Unaudited Unaudited Unaudited
£ £ £
Profit/(loss) before tax from continuing operations (890,369) 294,857 731,365
Adjusted by:
Interest income (45,773) - (110,344)
Gain on disposal - - (89,876)
Fair value movement 888,737 (422,220) (821,214)
────── ────── ──────
(47,405) (127,363) (290,069)
Changes in working capital
(Increase)/decrease in trade and other receivables (185) (91,294) (42,345)
(Decrease)/increase in trade and other payables (3,531) 25,853 33,073
────── ────── ──────
Net cash outflow from operating activities (51,121) (192,804) (299,341)
Cash flows from investing activities
Purchase of investments 5 (1,349,805) (3,480,873) (5,055,770)
Proceeds from sale of investments 138,016 - 339,851
────── ────── ──────
Net cash (outflow)/inflow from investing activities (1,211,789) (3,480,873) (4,715,919)
────── ────── ──────
Cash flows from financing activities
Net proceeds from share issues 607,000 7,577,053 7,582,053
────── ────── ──────
Net cash inflow from financing activities 607,000 7,577,053 7,582,053
────── ────── ──────
Increase/(decrease) in cash and equivalents (655,910) 3,903,376 2,566,793
Cash and cash equivalents at beginning of year 2,566,793 - -
────── ────── ──────
Cash and cash equivalents at end of year 1,910,883 3,903,376 2,566,793
══════ ══════ ══════
1. General Information
Intuitive Investments Group Plc is a company incorporated and domiciled in
England and Wales. The company is listed on the AIM market of the London Stock
Exchange (ticker: IIG).
The financial information set out in this Half Yearly report does not
constitute statutory accounts as defined in Section 434 of the Companies Act
2006. The group's statutory financial statements for the period ended 30
September 2021 were prepared under International Financial Reporting Standards
("IFRS").
Copies of the annual statutory accounts and the Half Yearly report can be
found on the Company's website at http://www.iigplc.com/
(http://www.iigplc.com/) .
2. Basis of preparation
The principal accounting policies applied in the preparation of the financial
information are set out below. These policies have been consistently applied.
Basis of preparation
The financial information of the Company has been prepared in accordance with
International Financial Reporting Standards (IFRS), International Accounting
Standards (IASs) and International Financial Reporting Interpretations
Committee (IFRIC) interpretations (collectively 'IFRS') as adopted for use in
the European Union and as issued by the International Accounting Standards
Board and with those parts of the Companies Act 2006 applicable to companies
reporting under IFRS.
The preparation of financial statements in conformity with IFRS requires the
use of certain critical accounting estimates. It also requires management to
exercise its judgement in the process of applying the accounting policies and
making any estimates. Changes in assumptions may have a significant impact on
the financial statements in the period the assumptions changed. Board of
Directors believe that the underlying assumptions are appropriate and that the
financial statements are fairly presented. The Board of Directors believes,
there are no areas involving a higher degree of judgement or complexity, or
areas where assumptions and estimates are significant to the financial
statements, and therefore, these financial statements have limited
disclosures.
3. Significant accounting policies
Income recognition
(i) Gains on realised investments
All purchases and sales of quoted investments are accounted for on the trade
date basis. All purchases and sales of unquoted investments are accounted for
on the date that the sale and purchase agreement becomes unconditional.
(ii) Interest income
Interest income is recognised using the effective interest method. Interest
income is interest earned on bank deposit accounts and loan notes and is
included within the statement of comprehensive income.
(iii) Management fees
The Company earns fee income from the monitoring fees from Investee Companies.
Revenue is recognised at the fair value of the consideration received or
receivable, excluding rebates. Fees earned for the provision of an ongoing
service are recognised as that service is provided.
Taxation
Income tax expense represents the sum of the tax currently payable and
deferred tax.
(i) Current tax
Current taxes are based on the results shown in the financial statements and
are calculated according to local tax rules using tax rates enacted or
substantially enacted by the statement of financial position date.
Income tax is recognised in the income statement or in equity if it relates to
items that are recognised in the same or a different period, directly in
equity.
Current tax assets and liabilities for the current and prior periods are
measured at the amount expected to be recovered from or paid to the taxation
authorities.
(ii) Deferred tax
Deferred tax is provided, using the liability method, on temporary differences
at the statement of financial position date between the tax base of assets and
liabilities and their carrying amounts for financial reporting purposes.
Deferred tax liabilities are recognised for all taxable temporary differences.
Deferred tax assets are recognised for all deductible temporary differences,
carry forward of unused tax assets and unused tax losses, to the extent that
it is probable that taxable profit will be available against which the
deductible temporary differences and the carrying forward or unused tax assets
and unused tax losses can be utilised.
3. Accounting policies (continued)
The carrying amount of deferred tax assets is reviewed at each balance sheet
date and reduced to the extent that it is no longer probable that sufficient
taxable profit will be available to allow all or part of the deferred tax
assets to be utilised. Conversely, previously unrecognised deferred tax assets
are recognised to the extent that it is probable that sufficient taxable
profit will be available to allow all or part of the deferred tax asset to be
utilised.
Deferred tax assets and liabilities are measured at the tax rates that are
expected to apply to the year when the asset is realised or the liability is
settled, based on the tax rates and tax laws that have been enacted or
substantively enacted at the balance sheet date.
Financial instruments
Financial assets and financial liabilities are recognised when the Company
becomes a party to the contractual provisions of the instrument.
Investments
All investments are designated upon initial recognition as held at fair value
through the profit and loss and are measured at subsequent reporting dates at
fair value in accordance with IFRS 9.
Publicly traded securities will be valued by reference to their bid price or
last traded price, if applicable, on the relevant exchange in accordance with
the Association of Investment Companies' valuation guidelines and applicable
accounting standards. Where trading in the securities of an Investee Company
is suspended, the investment in those securities will be valued at the
Chairman's estimate of its net realisable value. In preparing these
valuations, the Company will take into account, where appropriate, latest
dealing prices, valuations from reliable sources, comparable asset values and
other relevant factors.
Fair values for unquoted investments, including convertible loan notes or
investments for which the market is inactive, are established by using various
valuation techniques in accordance with the International Private Equity and
Venture Capital Valuation (the "IPEV") guidelines. These may include recent
arm's length market transactions, the current fair value of another instrument
which is substantially the same, discounted cash flow analysis and option
pricing models. Where there is a valuation technique commonly used by market
participants to price the instrument and that technique has been demonstrated
to provide reliable estimates of prices obtained in actual market
transactions, that technique is utilised.
Where an investment has been made recently, the Company may use cost as the
best indicator of fair value. In such cases, any changes or events subsequent
to the relevant transaction date would be assessed to ascertain if they imply
a change in the investment's fair value. Such valuations prepared by the
Investment Team will be approved by the Audit and Risk Committee at least
twice a year. If the Board considers that any of the above bases of valuation
are inappropriate in any case, or generally, it may adopt such other valuation
procedures as it considers reasonable in the circumstances.
3. Accounting policies (continued)
Other receivables and payables
Trade receivables and trade payables are measured at amortised cost.
Cash and cash equivalents
Cash and cash equivalents include cash in hand and deposits held on call,
together with other short term highly liquid investments which are not subject
to significant changes in value and have original maturities of less than
three months.
Share capital and reserves
Share capital: Represents the nominal value of equity shares. Share premium:
The account represents the accumulated premium paid for shares issued in
previous periods above their nominal value less issue expenses.
Retained Earnings
Represents the accumulated profits being the excess of income derived from
holding investments less the costs associated with running the Company. This
reserve may be distributed by way of dividends.
4. Earnings per Share
Basic earnings per share is calculated by dividing the earnings
attributable shareholders by the weighted average number of ordinary shares
outstanding during the period.
Reconciliations are set out below:
Period to
31 March 2022
Unaudited
Basic
Earnings attributable to ordinary shareholders (716,516)
Weighted average number of shares 48,046,357
Earnings (Loss) per-share - pence (1.49)p
═════
Diluted
Earnings attributable to ordinary shareholders (716,516)
Weighted average number of shares 48,046,357
Earnings (Loss) per-share - pence (1.49)p
═════
As at 31 March 2022 there were 1,962,500 outstanding share
warrants.
5. Investments
Cost £
At 11 June 2020 -
Additions during the period 3,480,873
Revaluation at 31 March 2021 452,201
──────
At 31 March 2021 3,933,074
Additions during 6 months to 30 September 2021 1,574,897
Disposals (249,975)
Accrued interest 110,344
Change in fair value 369,013
──────
At 30 September 2021 5,737,353
Additions during 6 months to 31 March 2022 5,641,782
Disposals (136,016)
Accrued interest 43,773
Change in fair value (888,737)
──────
10,398,155
══════
6. Share Capital
Issued share capital comprises:
Period to Period to Period to
to 31 March 2022 to 31 March to 31 September 2021
Unaudited 2021 Audited
Unaudited
£ £ £
Ordinary shares of 1p each 657,903 404,192 404,418
─────── ─────── ───────
657,903 404,192 404,418
═══════ ═══════ ═══════
During the period to 31 March 2022 the company issued ordinary shares of
£0.01 each listed, as follows:
Number
Date issued Price Type
04/03/2022 £0.22 Placing 2,759,091
04/03/2022 £0.19 Vendor consideration 22,589,352
───────
25,348,443
═══════
7. Post balance sheet events
On 25 February 2022, the Company announced it had acquired Touchless
Innovation Limited in exchange for 28,863,636 new Ordinary Shares and £1
million in cash. The consideration shares were issued in two tranches. The
second tranche of 6,274,284 consideration shares, were issued to Stuart White,
the Chief Executive Officer of Touchless Innovation Limited on 26 April 2022.
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