REG-Limitless Earth Plc: Half-year Report
30/10/2020 07:00
30 October 2020
LIMITLESS EARTH PLC
("Limitless" or the "Company")
UNAUDITED HALF-YEARLY RESULTS FOR
THE SIX MONTHS ENDED 31 JULY 2020
The Company is pleased to announce its half-yearly result for the six months
to 31 July 2020.
CHIEF EXECUTIVE’S STATEMENT
Limitless is a proactive investing company that focuses on making investments
in and assisting companies that show the potential to generate returns through
capital appreciation. The directors look to make investments into small
companies which have clear routes to value appreciation, and which operate in
sectors with long term growth prospects that are driven by demographic
change. Examples of such sectors include Cleantech, Life Sciences and
Technology. The Company has four investments, and reports on them below.
It is the Board’s intention to have its investments revalued in the next few
months.
Saxa Gres S.p.A (“Saxa”) is a turn-around circular economy company which
specialises in an innovative porcelain and ceramic stone tile production
process using recycled urban waste. It has been extremely successful in
expanding its operations by competitor acquisitions and this has enabled it to
satisfy the increasing demands for its products while attracting valuable
funding from relevant institutional investors.
Saxa’s main product is Grestone, which it describes as a ‘ceramic
stone’, is a patented conglomerate composed of 70% porcelain stoneware and
30% waste from industrial incinerators which can cope with high stress and is
targeted for use in urban surfacing and street design.
Limitless’ investment rational was driven by the changing behavioural trends
of consumers and the attitudes of businesses and governments towards products
with greater social impact compared to traditional manufacturing. As Saxa has
established a proven production process using waste incinerator ash
amalgamated into high quality tiles, it has established its strong ESG
credentials. The Company further hopes that Green Public Procurement, a
voluntary European instrument which provides guidelines and criteria aimed at
Europe’s public authorities for sustainable production and consumption, will
help drive European demand for Saxa’s products through increased
requirements to recognise environmental credentials early in tender
processes. Saxa has seen significant growth in international demand for its
products with the Italian domestic market now only representing 5-10% of its
orders.
Since our initial investment, Saxa has expanded its production capacity and
continued to innovate products. More recently, Saxa has launched a
cobblestone product for pedestrian crossings whereby the colour is
incorporated into the cobblestone such that it will not discolour and fade
with age. The products are targeted at local authorities and it is expected
that, in addition to product’s environmental credentials, it should provide
long term cost savings through reduced maintenance.
To date, Limitless has made three investments in Saxa and, as a result, holds
EUR 617,000 of 10 per cent. listed loan notes and EUR 75,000 of 10 per cent.
unlisted loan notes with an option to acquire approximately 2.38 per cent. of
the equity share capital of Saxa Gres at an exercise price of €1EUR per
share.
The Board of LME is pleased with the commercial progress that Saxa Gres has
made and is hopeful of being able to positively revalue its investment in the
near-term as financial information and performance data becomes available.
V-Nova Ltd. (“V-Nova”) is a London-headquartered technology company
providing next-generation data compression solutions that address the
ever-growing media processing and delivery challenges. V-Nova is an IP
Software company which has developed an innovative video and imaging
compression technology with broad application from developed, data-rich
economies to emerging markets. V-Nova provides solutions spanning the entire
media delivery chain, including content production, contribution, storage and
distribution to end-users.
V-Nova’s management is targeting the company’s technology at becoming an
integrated world standard, evidence of which is supported by the Moving
Picture Experts Group (MPEG) having selected V-Nova’s technology to become a
new standard (MPEG5-Part2). This is expected to yield V-Nova a recurring
revenue stream for a long period. In addition, V-Nova recently announced
that the MPEG coding standard, LCEVC standard specification, is final.
Limitless is hopeful for further news of corporate development and contracts
following what it believes may be milestone events for V-Nova which should
allow V-Nova to expand into further vertical sales channels.
The Company’s investment rational for V-Nova was from its desire to invest
into technology related to the provision and consumption of data. This is a
field in which Limitless considers there will be considerable growth for the
foreseeable future as consumption trends seem to increase faster than telecoms
companies are able to build infrastructure driving the need for better data
compression and processing.
Limitless invested £500,000 in V-Nova on 18 December 2015 in a convertible
loan note, which was subsequently converted in April 2017 into Series B1
participating shares at a valuation of V-Nova of c. £80 million.
We have been advised that V-Nova is currently fundraising and, following the
completion of this round, we are hopeful that it will be possible to
positively revalue our investment to match these new terms.
Chronix Biomedical, inc. (“Chronix”), is a privately-owned biotech company
founded in 1997 which specialises in simple blood tests (liquid biopsies) for
real-time monitoring of the effectiveness of cancer drugs, including
immunotherapies, and rejection of transplanted organs. Chronix’s cancer test
is based on patented technology whereby it can identify gains and losses in
cell free DNA that allow them to determine if a cancer therapy is working.
Similarly, its transplant test allows it to determine if an organ that is
transplanted is being accepted or rejected by the recipient. This helps inform
the physician so as to alter the immunosuppressive drug regime given to the
patient.
In June 2018, Chronix signed its first commercial agreement with a large
EU-based lab group, which already processes more than 150,000 laboratory
samples daily, providing an exclusive licence for Germany, Austria,
Switzerland and Belgium. The contract is for 15 years and, as previously
advised, independent research analysts estimated the net present value of the
licensing payments to Chronix over the life of the agreement to be
approximately $92 million, subject to a minimum number of tests being
performed each year.
Chronix recently announced a further licensing agreement with a Nasdaq listed
company for its CNI monitoring technology used in Chronix's liquid biopsy
tests which detects tumour-derived cell-free DNA in blood samples of patients.
Limitless’ investment rational for its investment in Chronix was driven by
the Company’s view of significant growth opportunities in the medical
screening sector as developments in drugs and medical understanding require
more advanced and immediate clinical diagnostics tools.
To date, Limitless has invested US$600,000 in Chronix, which includes a
follow-on investment of US$100,000, by way of convertible preference stock and
a 6 per cent. convertible loan note.
The Board of LME values and recognises the considerable achievements of
Chronix’s management and understands that additional funding and partnership
agreements are needed to continue to develop the company’s operations as it
moves from concept towards commercialisation, to exploit its potential and,
ultimately, drive company valuation. Chronix’s management team continues
to actively raise funds to support its objectives and to support the company
to financial breakeven.
Exogenesis Corporation is a Boston-based nanotech firm which specialises in
modifying and controlling the surface of objects at a nanoscale level, through
accelerated particle beam processing, to avoid needing to apply coatings.
Application of the company’s technology can improve the safety and efficacy
of implantable medical devices and improve the performance of optics, glass
and a variety of substrates used in the laser, memory and semiconductor
industries. Exogenesis Corporation is a pre-revenue business.
Exogenesis Corporation Received 510(k) Clearance for the Exogenesis Hernia
Mesh, First Soft Tissue Repair Device with Nano-Modified Surface in October
2019, albeit news flow since then has been limited as to further developments.
More recently, in October 2020, Exogenesis Corporation announced that early
trials of its Exogenesis Surgical Mask, a protective nose and mouth covering
for healthcare workers and patients, achieved its primary endpoints of
trapping and deactivating COVID-19 viral particles in simulated real-world
exposures. The Company used its Accelerated Neutral Atom Beam technology to
increase the surface area of fibres allowing for more colloidal copper to be
applied to the mask, increasing the protective barrier. The company hopes to
progress to premarket regulatory filings soon for this product.
The Board of LME recognises Exogenesis’ technological achievements and, as
it has still to prove its revenue streams, awaits news of its first commercial
deals which are expected to be linked to selling into its existing vertical
sectors.
The Board of Limitless consider that Exogenesis’ last announcement provides
renewed optimism for the company’s business model and, in turn, this
investment.
Limitless invested US$300,000 in May 2016 in Exogenesis Corporation by way of
8 per cent. convertible senior notes.
During the reporting period, the Company looked at new potential investments
and opened a series of due diligence on potential new investments some of
which are ongoing. The Board continues to actively source new investments.
This announcement contains inside information for the purposes of Article 7 of
EU Regulation 596/2014.
For further information, please contact:
Limitless Earth plc
www.limitlessearthplc.com
Guido Contesso - CEO
+44 7780 700 091
Cairn Financial Advisers LLP
+44 20 7213 0880
Nominated Adviser
www.cairnfin.com
Jo Turner/Sandy
Jamieson
Peterhouse Corporate Finance Limited +44 20 7469
0930
Joint
Broker
www.pcorpfin.com
Peter
Greensmith
UNAUDITED INCOME STATEMENT AND
STATEMENT OF COMPREHENSIVE INCOME
6 MONTHS ENDED 31 JULY 2020
Notes Unaudited Unaudited Audited
31/07/2020 31/07/2019 31/01/2020
Continuing operations £ £ £
Investment Income 13,430 14,379 37,797
Total Income 13,430 14,379 37,797
Administration expenses (80,022) (74,511) (186,384)
Foreign currency exchange gain/ loss 46,013 (29,948)
Operating loss and loss before taxation (20,579) (60,132) (178,535)
Taxation - - -
Loss for the period (20,579) (60,132) (178,535)
Total Comprehensive loss for the period (20,579) (60,132) (178,535)
Earnings per share:
Basic and diluted loss per share 3 (0.0003p) (0.09p) (0.0027p)
There are no items of other comprehesive income.
UNAUDITED STATEMENT OF FINANCIAL POSITION
AS AT 31 JULY 2020
Unaudited Unaudited Audited
31/07/2020 31/07/2019 31/01/2020
£ £ £
Current assets
Investments held for trading 1,809,398 1,711,809 1,763,386
Trade and Other receivables 86,238 53,123 77,158
Cash 151,936 419,007 262,845
2,047,572 2,183,939 2,103,389
Total Assets 2,047,572 2,183,939 2,103,389
Current Liabilities
Trade and other payables (38,215) (35,600) (73,453)
Net Assets 2,009,357 2,148,339 2,029,936
Equity
Issued Share Capital 654,000 654,000 654,000
Share Premium 2,350,630 2,364,725 2,350,630
Share Warrant Reserve - - -
Retained Earnings (995,273) (870,386) (974,694)
Total Equity 2,009,357 2,148,339 2,029,936
Unaudited Statement of Changes in Shareholders’ Equity
for the period ended 31 July 2020
Share capital Share premium Share warrant reserve Retained earnings Total
£ £ £ £ £
Audited Changes in Equity for the period ended 31 January 2018 654,000 2,350,630 14,095 (781,716) 2,237,009
Comprehensive loss for the period - - - (28,538) (28,538)
Audited Changes in Equity for the period ended 31 January 2019 654,000 2,350,630 14,095 (810,254) 2,208,471
Comprehensive loss for the period (178,535) (178,535)
Warrants expired during the period - - (14,095) 14,095 -
Audited Changes in Equity for the period ended 31 January 2019 654,000 2,350,630 - (974,694) 2,029,936
Comprehensive loss for the period - - - (20,579) (20,579)
Warrant cancellation - -
Unaudited Changes in Equity for the period ended 31 July 2020 654,000 2,350,630 - (995,273) 2,009,357
UNAUDITED CASH FLOW STATEMENT FOR THE
6 MONTHS ENDED 31 JULY 2020
Unaudited Unaudited Audited
31/07/2020 31/07/2019 31/01/2020
2020 2019 2020
£ £ £
Cash flows from operating activities
(Loss) for the year before tax (20,579) (60,132) (178,535)
Investment income (13,430) (14,379) (37,797)
Foreign Currency exchange gain/ loss (46,013) - 29,947
Decrease/ (increase) in receivables (9,079) (19,833) (43,869)
(Decrease)/ increase in payables (35,237) (31,890) 5,964
Net cash outflow from operating activities (124,338) (126,234) (224,290)
Cash flows from investing activities
Finance income received net 13,430 14,379 37,797
Purchase of investments - - (81,526)
Net cash outflow from investing activities 13,430 14,379 (43,729)
Net decrease in cash and cash equivalents during the year (110,908) (111,855) (268,019)
Cash at the beginning of year 262,844 530,862 530,863
Cash and cash equivalents at the end of the year 151,936 419,007 262,844
UNAUDITED CASH FLOW STATEMENT FOR THE
6 MONTHS ENDED 31 JULY 2020
NOTES TO THE FINANCIAL STATEMENTS
1. General Information
Limitless Earth plc is a company incorporated and domiciled in England and
Wales. The Company’s ordinary shares are traded on the AIM market of the
London Stock Exchange. The address of the registered office is Suite 2,
Northside House, Mount Pleasant, Barnet, Hertfordshire, England, EN4 9EB
The principal activity of the Company is that of an investing company pursuing
a strategy
2. Accounting policies
The principal accounting policies have all been applied consistently
throughout the period covered and have not changed since being reported on in
the financial statements for the year ended 31 January 2020.
Basis of preparation
The interim financial information set out above does not constitute statutory
accounts within the meaning of the Companies Act 2006. It has been prepared on
a going concern basis in accordance with the recognition and measurement
criteria of International Financial Reporting Standards (IFRS) as adopted by
the European Union.
The financial statements have been prepared under the historical cost
convention.
The interim financial information for the six months ended 31 July 2020 has
not been reviewed or audited. The interim financial report has been approved
by the Board on 29 October 2020.
3. Loss per share
The basic earnings per share is calculated by dividing the earnings
attributable to ordinary shareholders by the weighted average number of
ordinary shares outstanding during the period. Diluted earnings per share is
computed using the same weighted average number of shares during the period
adjusted for the dilutive effect of share warrants and convertible loans
outstanding during the period.
Unaudited Unaudited Audited
31/07/2020 31/07/2019 31/01/2020
Loss from continuing operations attributable to equity holders of the company (20,579) (60,132) (178,535)
Weighted average number of ordinary shares in issue 65,400,000 65,400,000 65,400,000
Pence Pence Pence
Basic and fully diluted loss per share from continuing operations (Pence) (0.0003) (0.0009) (0.0027)
4. Copies of Interim Accounts
Copies of the interim results are available at the Group´s website at:
www.limitlessearthplc.com.
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