REG-Limitless Earth Plc: Half-year Report
31/10/2022 07:15
31 October 2022
LIMITLESS EARTH PLC
("Limitless" or the "Company")
UNAUDITED HALF-YEARLY RESULTS FOR
THE SIX MONTHS ENDED 31 JULY 2022
The Company announces its half-yearly result for the six months to 31 July
2022.
CHIEF EXECUTIVE’S STATEMENT
Limitless is an investing company that focuses on making investments in and
assisting companies that show potential to generate returns through capital
appreciation. The directors look to make investments in small companies that
have clear growth strategies and operate in sectors that have long-term growth
prospects and are driven by demographic change. Examples of such sectors
include Cleantech, Life Sciences and Technology. The Company has four
investments, of which further details are included below.
Saxa Gres S.p.A (“Saxa”) is a turnaround circular economy company which
specialises in using an innovative production process for porcelain and
ceramic stone tiles using recycled urban waste. It has been very successful in
expanding its operations by competitor acquisition and this has enabled it to
satisfy the increasing demand for its products while attracting valuable
funding from relevant institutional investors.
Saxa’s main product is Grestone, which it describes as a ‘ceramic
stone’. Grestone 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 proven 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.
In January 2021 A2A, a major listed Italian utility firm, announced it had
acquired 27.7% of Saxa. This strategic acquisition is of importance to Saxa
and may, in time, create an exit opportunity for the Company. On making of its
acquisition, A2A states, “Saxa as the first Circular Factory to produce
urban paving and tiles using an innovative ‘end of waste’ process that
enables materials, such as the ash produced by waste-to-energy plants, to be
recovered from the waste cycle and reused to make a new product.
To date, Limitless has made three investments in Saxa and, as a result, holds
EUR 592,000 of 7 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 EUR 1 per share.
During the reporting period, the Company announced, on 21 July 2022, that Saxa
Gres had extended the maturity of the bonds held by the Company from 2026 to
2027 and agreed that it would pay coupons conditional on certain revenue
targets being met and linked to the sale of non-core assets. As a result of
this restructuring, the Company decided to reduce its holding in the bonds and
sold 275 bonds for a total consideration of EUR 165,000. Following the sale,
the Company continues to hold 317 bonds.
In December 2021, the CEO of Saxa Gres stated that whilst the company had
turnover of EUR 50 million in the six-month period to September 2022, the
rising energy costs had impacted its margins and, despite a full order book,
production would be halted from September until the end of 2022. The company
previously reported that in the first half of 2022, energy expenditure was EUR
22 million in comparison to EUR 6 million for 2021.
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.
In November 2020, V-Nova announced it had achieved a milestone achievement in
MPEG-5 Part 2 LCEVC (Low Complexity Enhancement Video Coding) being promoted
to MPEG/ISO final draft international standard. V-Nova co-chaired the
standard’s development and contributed to the foundational technology upon
which it is built. MPEG-5 Part 2 LCEVC is the first internationally
accredited enhancement standard for any existing and future video compression
scheme.
In January 2022, it was announced that V-Nova LCEVC video compression was
selected by Brazilian SBTVD Forum for Brazil’s Upcoming TV 3.0. The company
anticipates that securing this deal would be very lucrative for it, generating
licensing revenues that may be worth tens of millions in total over a number
of years.
V-Nova claims its LCEVC technology provides a boost to the compression
efficiency of any existing or future video codec, enabling higher quality
compression at up to 40% lower bitrates while improving encoding efficiency
and reducing processing energy demands by up to 75 per cent. The company’s
CEO and co-founder Guido Meardi believes LCEVC will be adopted by the industry
by integration by device or chipset manufacturers, operating systems,
browsers, for in-house development and encoder or player vendors being LCEVC
an enhancement, rather than a full codec and it is deployable immediately on
both new and existing infrastructure, including devices that are already in
the hands and in the households of end-users.
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.
The Board revalued the investment to match these new terms and, given the
codec standard has been reached, the Directors are optimistic that the company
will be able to swiftly reach its full market potential.
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 USD 92 million, subject to a minimum number of tests being
performed each year.
After announcing a further licensing agreement with Nasdaq listed Oncocyte
(NSDQ:OCX) for Chronix's CNI monitoring technology (a liquid biopsy test which
detects tumour-derived cell-free DNA in blood samples of patients), in April
2021 Oncocyte announced that it completed the acquisition of Chronix.
Oncocyte stated the acquisition of Chronix will provide it with a distinct
competitive advantage as the first and only company to potentially offer a
continuum of tests, from patient selection to monitoring the effectiveness of
treatment. The simplicity of the blood sample-based test allows physicians
to quickly and easily monitor patients.
The acquisition included the intellectual property and technology for
Chronix’s TheraSure™ copy number instability (CNI) monitoring test for
immune therapy monitoring. Further Oncocyte has acquired intellectual property
relating to organ transplant technology and associated patent portfolio
developed by Chronix.
Oncocyte has stated its intentions to launch the test for research use only in
domestic immunotherapy clinical trials during the fourth quarter of 2021.
Oncocyte expects the first indication to be for lung cancer before expanding
to other cancer types and the Company awaits further new in this regard.
In May 2022, Oncocyte Completed the Validation of TheraSure™ Transplant
Monitor Test allowing for rapid turnaround time to facilitate fast and
accurate post-transplant treatment decisions
From the Chronix acquisition completed in April 2021. This announcement made
by the company marks the successful completion of technology transfer and
Oncocyte’s readiness to deploy TheraSure™.
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.
Limitless held 0.72 per cent. of Chronix’s issued share capital on a fully
diluted basis. Limitless also previously announced on 20 September 2019 a
further investment of USD 100,000 by way of an unsecured Convertible
Promissory Note ("Note") with an interest rate of six percent per annum. The
merger did not trigger the conversion of the Note, and the Note has been
repaid in full following Completion.
The agreement provides for Oncocyte to pay a revenue share on the net
collected revenues for certain tests and services for specific periods, and to
pay a combination of cash or Oncocyte common stock of up to USD 14 million if
certain milestones are achieved. Net acquisition proceeds and any milestone
revenue receipts are expected to be returned to Chronix’s shareholders based
on the order of the investment rounds in which they invested.
The Company understands that Oncocyte considers it may be possible for
payments under the revenue share to commence in 2023.
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. Since this approval, there has been a limited news flow with regards
further development of this device.
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.
In April 2021, nanoMesh LLC, a subsidiary of Exogenesis Corporation, announced
that it had initiated First-In-Man implantation of its proprietary soft tissue
repair device and that it expected additional implantations concurrent with
national distribution to follow.
In August 2021, nanoMesh™ LLC, a subsidiary of Exogenesis Corporation, and
Veteran's Healthcare Supply Solutions (VHSS) announced a National Distribution
Agreement for the nanoMesh™ Product Line Offering to the Clinical Community.
In January 2022 a report published by Vantage Market Research, citing
Exogenesis nanoMesh™ product, projected that the Global Nanotechnology in
Medical Devices Market size is expected to reach USD 1,908 Million by 2028
with a 12.2% CAGR Growth.
This research pointed out that improved and more cost-effective medical
treatment required by the elderly people around the world along with rising
demand for cheaper and better healthcare is anticipated to propel market
demand in the long run: “ In the developed economies elderly populations are
putting tremendous strains on healthcare systems, similarly, in the budding
economies, the growing population along with rising middle-class population
are creating new demand for medical treatment. Nanotechnology is playing a
crucial role in overcoming this global challenge for medical treatment”.
Exogenesis Hernia Mesh (nanoMesh™) is an innovative soft tissue repair
implant, cleared, constructed of monofilament polypropylene (PP) and possesses
a unique nanometer-level surface texture, via the application of Accelerated
Neutral Atom Beam (ANAB) technology during manufacturing.
The implant targets the repair of abdominal wall hernias and abdominal wall
deficiencies that require the addition of reinforcing material to obtain the
desired surgical result. Exogenesis nanoMesh™ is expected to be commercially
available throughout the US during 2021.
The Board of Limitless recognises Exogenesis’ technological achievements
and, whilst the business has taken time to bring a product to market, it
maintains optimism for the company’s business model and, in turn, this
investment.
Limitless invested USD 300,000 in May 2016 in Exogenesis Corporation by way of
8 per cent. convertible senior notes.
In addition to its current portfolio of investments, the Company has reviewed
other new potential investments during the reporting period, and commenced due
diligence check on these 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 Guido Contesso - CEO +44 7780 700 091 www.limitlessearthplc.com
Cairn Financial Advisers LLP Nominated Adviser Jo Turner/Sandy Jamieson +44 20 7213 0880 www.cairnfin.com
Peterhouse Capital Limited Broker Peter Greensmith / Charles Goodfellow +44 20 7469 0930 www.peterhousecap.com
UNAUDITED INCOME STATEMENT AND
STATEMENT OF COMPREHENSIVE INCOME
6 MONTHS ENDED 31 JULY 2022
Notes Unaudited Unaudited Audited
31/07/2022 31/07/2021 31/01/2022
Continuing operations £ £ £
Investment Income - 18,788 22,426
Total Income - 18,788 22,426
Administration expenses (128,679) (90,008) (410,157)
Foreign currency exchange gain/ loss 66,738 (31,619) (24,348)
Operating loss and loss before taxation (61,941) (121,627) (412,079)
Taxation - - -
Loss for the period (61,941) (102,839) (412,079)
Total Comprehensive loss for the period (61,941) (102,839) (412,079)
Earnings per share:
Basic and diluted loss per share 3 (0.002) (0.002) (0.006)
There are no items of other comprehensive income.
UNAUDITED STATEMENT OF FINANCIAL POSITION
AS AT 31 JULY 2022
Unaudited Unaudited Audited
31/07/2022 31/07/2021 31/01/2022
£ £ £
Current assets
Investments held for trading 1,452,390 1,745,108 1,524,560
Trade and Other receivables 18,461 69,269 15,730
Cash 126,386 117,572 95,737
1,597,237 1,931,950 1,636,027
Total Assets 1,597,237 1,931,950 1,636,027
Current Liabilities
Trade and other payables (91,814) (55,346) (68,663)
Net Assets 1,505,423 1,876,604 1,567,364
Equity
Issued Share Capital 654,000 654,000 654,000
Share Premium 2,350,630 2,350,630 2,350,630
Share Warrant Reserve - - -
Retained Earnings (1,499,207) (1,128,026) (1,437,266)
Total Equity 1,505,423 1,876,604 1,567,364
UNAUDITED CASH FLOW STATEMENT FOR THE
6 MONTHS ENDED 31 JULY 2022
Unaudited Unaudited Audited
31/07/2022 31/07/2021 31/01/2022
2022 2021 2022
£ £ £
Cash flows from operating activities
(Loss) for the year before tax (61,941) (102,839) (412,079)
Investment income - (18,788) (22,426)
Foreign Currency exchange gain/ loss (66,738) (31,619) 24,348
Decrease/ (increase) in receivables (2,731) (32,898) 26,019
(Decrease)/ increase in payables 21,413 30,353 (25,036)
Net cash outflow from operating activities (109,997) (155,791) (409,174)
Cash flows from investing activities
Finance income received net - 18,788 22,426
Sale or (Purchase) of investments 140,646 97,356 97,357
Fair value revaluation of Investment - - 227,820
Net cash outflow from investing activities 140,646 116,144 347,603
Net decrease in cash and cash equivalents during the year 30,649 (39,647) (61,571)
Cash at the beginning of year 95,737 157,310 157,308
Cash and cash equivalents at the end of the year 126,386 117,663 95,737
Unaudited Statement of Changes in Shareholders’ Equity
for the period ended 31 July 2022
Share capital Share premium Retained earnings Total
£ £ £ £
Audited Changes in Equity for the period ended 31 January 2021 654,000 2,350,630 (1,025,187) 1,979,443
Comprehensive loss for the period (412,079) (412,079)
Audited Changes in Equity for the period ended 31 January 2022 654,000 2,350,630 (1,437,266) 1,567,364
Comprehensive loss for the period (61,941) (61,941)
Unaudited Changes in Equity for the period ended 31 July 2022 654,000 2,350,630 (1,499,207) 1,505,423
NOTES TO THE FINANCIAL STATEMENTS
FOR THE 6 MONTHS ENDED 31 JULY 2022
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 that focuses on making investments in and assisting companies which
exhibit the potential to generate returns of many multiples through capital
appreciation. Typically, Limitless invests in small companies where there
are clear catalysts for value appreciation and the companies are operating in
sectors exhibiting long term growth linked to demographic change.
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 2022.
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 2022 has
not been reviewed or audited. The interim financial report has been approved
by the Board on 28 October 2022.
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
31/07/2022 31/07/2021 31/01/2022
Loss from continuing operations attributable to equity holders of the company (61,941) (102,839) (412,079)
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) (0.001) (0.002) (0.006)
4. Copies of the half-yearly report
Copies of the interim results are available at the Group´s website at:
www.limitlessearthplc.com.
Note:
Certain statements made in this announcement are forward-looking statements.
These forward-looking statements are not historical facts but rather are based
on the Company's current expectations, estimates, and projections about its
industry; its beliefs; and assumptions. Words such as 'anticipates,'
'expects,' 'intends,' 'plans,' 'believes,' 'seeks,' 'estimates,' and similar
expressions are intended to identify forward-looking statements. These
statements are not a guarantee of future performance and are subject to known
and unknown risks, uncertainties, and other factors, some of which are beyond
the Company's control, are difficult to predict, and could cause actual
results to differ materially from those expressed or forecasted in the
forward-looking statements. The Company cautions security holders and
prospective security holders not to place undue reliance on these
forward-looking statements, which reflect the view of the Company only as of
the date of this announcement. The forward-looking statements made in this
announcement relate only to events as of the date on which the statements are
made. The Company will not undertake any obligation to release publicly any
revisions or updates to these forward-looking statements to reflect events,
circumstances, or unanticipated events occurring after the date of this
announcement except as required by law or by any appropriate regulatory
authority.
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