REG - Minoan Group PLC - Results for the year ended 31 October 2024
29/07/2025 07:00
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RNS Number : 8865S Minoan Group PLC 29 July 2025
The information contained within this announcement is deemed to constitute
inside information as stipulated under the Market Abuse Regulation (EU) No.
596/2014. Upon the publication of this announcement, this inside information
is now considered to be in the public domain
29 July 2025
Minoan Group Plc
("Minoan", the "Group" or the "Company")
Results Announcement
Minoan Group Plc announces its results for the year ended 31 October 2024
The Directors are pleased to confirm that Minoan Group Plc's Report and
Financial Statements for the year ended 31 October 2024 were submitted in time
to meet the filing extension deadline set by Companies House.
Project Highlights
· Impasse with the Project landlord the Foundation Panagia
Akrotiriani.
· Recently appointed Greek advisory team ended their relationship
with Minoan Group Plc in December 2024 following non-payment.
· The last face-to-face meeting between Directors of the Company and
the Board Members of the Foundation took place on 18 June 2024.
Financial Highlights
· The Board has decided that the Company is not a going concern.
· The Company's only cash resources are those made available to it by
DAGG LLP.
· Due to uncertainty, the auditors have not expressed an opinion on
the financial statements.
· The Group made a loss for the year, after taxation of £47,294,000
(2022/23: £529,000).
· The loss includes an impairment of inventories of £42,521,000
(2022/23: £Nil).
· Net assets / liabilities decreased to Liabilities of £4,174,000;
(2023: Assets £42,190,000).
Timothy Hill, Independent Director of Minoan, said:
"The relationship with the Foundation has reached an impasse. In the Annual
Report and Accounts for the year ended 31 October 2024, I have endeavoured to
be as transparent as possible on this matter as well as on the liquidity and
solvency issues confronting the Company.
Throughout the audit process, I ensured that a "Chinese Wall" was maintained
between Nicholas Day and the other members of DAGG LLP. He is now free to have
further discussions with them. To protect the interests of all stakeholders,
Nicholas and the other DAGG LLP members must, as soon as reasonably possible,
formalise an offer. A week from the publication of these results would appear
to be a reasonable deadline. Should DAGG LLP fail to do so, it is the view of
the Board that Minoan Group Plc will enter an insolvency process".
Trading in the Company's shares on AIM will remain suspended pending
clarification of the Company's financial position and the outcome of
discussions with members of DAGG LLP referred to in this announcement.
Minoan Group Plc's Report and Financial Statements for the year ended 31
October 2024 can be viewed on the Company's website with effect from 29 July
2025.
For further information visit www.minoangroup.com or contact:
Minoan Group Plc
Nicholas Day
nicholas.day@minoangroup.com
Zeus
020 3829 5000
Antonio Bossi / Andrew de Andrade
Peterhouse Capital Limited
020 7469 0930
Duncan Vasey
Director's Statement - T R C Hill
Introduction
No Chairman's Statement had been shared with the Board of Directors or
auditors ahead of the six-month audit deadline (30 April 2025) or before the
former Chairman's resignation on 23 May 2025. Therefore, I have written in my
capacity as the only director present during the fiscal year in question who
remains in place to this day.
Financial Review
Minoan Group Plc recorded no net revenues in the year ending 31 October 2024.
Operating costs increased by £122,000, being 23% higher versus the prior
year. Almost all of this was accounted for by the increase in the salary of
the then Chairman, Christopher Egleton, which rose by £120,000 from £60,000
to £180,000 for the year.
There was a noteworthy increase in Finance Costs in respect of Other
interest/fees, which increased from £4,000 in the year ended 31 October 2023
to £178,000 in the year ended 31 October 2024, as a result of the premium
payable in respect of the extension of the repayment date of the loan from
DAGG LLP.
The loss before taxation for the year was £47,294,000 compared to £529,000
recorded for the year to 31 October 2023. Aside from the significant increase
in operating costs and impairment charge, there was no offset from a reduction
in the Fair Value of Warrants issued this fiscal year. In the prior fiscal
year, a reduction in the Fair Value of Warrants had lowered losses by
£158,000. As discussed further in the Directors' statements, after the year
end, the Directors undertook an impairment review of the Itanos Gaia Project
at Cavo Sidero in Crete (the "Project"). The review led to an impairment of
£42,521,000 of the inventories held in the balance sheet, reducing the
carrying value, determined on a net recoverable basis, to £6,100,000.
Throughout the fiscal year, ordinary shares of 1p each ("Ordinary Shares")
were issued to settle certain liabilities. At the Company's General Meeting,
held on 10 November 2023, Resolution 1 seeking authorisation to settle
£707,231 of the Secured Loan outstanding to DAGG LLP by the issue of shares,
was duly passed. A total of 70,723,100 new Ordinary Shares were admitted to
trading in AIM ("Admission") from 15 November 2023. Loan interest increased to
£196,000 from £147,000 in the year to 31 October 2023. On 14 February 2024,
7,500,000 new Ordinary Shares were admitted to trading on AIM to settle
certain liabilities. On 3 May 2024, 14,767,467 new Ordinary Shares were
admitted to trading on AIM to settle certain liabilities.
Board and Management
On 7 March 2024, Professor George Mergos resigned as a Director of Minoan
Group Plc and Chairman of Loyalward Limited, the Group's wholly owned
subsidiary. No successor to either role was appointed. Instead, a new external
Greek advisory team bringing additional legal support for the negotiations
with the Foundation was appointed. That team remained in place until December
2024.
On 30 April 2025, Grahame Cook failed to be re-elected as a Director of Minoan
Group Plc.
On 16 May 2025, Nicholas Day was appointed a Director of Minoan Group Plc.
On 23 May 2025, Christopher Egleton, Chairman, resigned as Director of Minoan
and its subsidiary companies.
At the Company's Annual General Meeting, held on 30 April 2024, Resolution1
was adjourned and Resolution3 in respect of the re-election of Grahame Cook as
a director of Minoan Group Plc was defeated. All other resolutions at that
meeting were passed. Minoan Group Plc's Annual Report and Accounts for the
fiscal year ended 31 October 2023 were not published ahead of the AGM of 30
April 2024 or on the day of the meeting itself.
The Company's Nominated Adviser and Broker changed to Zeus Capital Limited on
12 September 2024. This change followed the acquisition by Zeus Capital
Limited of the WH Ireland Capital Markets Division (from WH Ireland Limited).
Director's Statement - T R C Hill (continued)
Outlook
Minoan Group Plc's accounts for the year ended 31 October 2024 were prepared
on a break-up basis given insufficient liquidity and the impairment of the
Itanos Gaia site valuation resulting in the Company having negative
shareholder funds. The Company will enter an insolvency process should the
indicative proposal from DAGG LLP fail to advance.
T R C Hill
Director
29 July 2025
Director's Statement and Strategic Review - N J Day
Introduction
I joined the Board of Directors of Minoan Group Plc ("Minoan") on 16 May 2025.
However, I only enjoyed full access, being directly or indirectly, to the bank
accounts and emails of Minoan") and Loyalward Limited ("Loyalward") from 23
May 2025. The RNS "Appointment of Non-Executive Director" of 16 May 2025
details any potential conflict of interest that I might have. Mindful of the
potential conflict of interest, Tim Hill and I have ensured that a strict
"Chinese Wall" has been maintained between me and the other members of DAGG
LLP throughout this audit.
Review of business
Tim Hill has provided a review of the Group's business given in the Statement
on pages 2 and 3.
The Key Performance Indicator for the Group is the Monetisation of the
Project. Monetisation means the extraction of value from the Project for the
benefit of shareholders and other stakeholders. No extraction of value
occurred in the last fiscal year. Nor has any extraction of value occurred
since the Site has been provided to Loyalward under the terms of the Contract
entered into following an international tender.
Group Principal Activities
The Company is a public limited company incorporated in England and Wales and
quoted on AIM, albeit trading of the Company's shares was suspended
temporarily with effect from 1 May 2025. The Company's principal activity in
the year under review was that of a holding and management company of a Group
involved in the design, creation, development, and management of
environmentally friendly luxury hotels and resorts.
Principal Risks and Uncertainties
The Group's key risk is the Project.
Two themes are constant: the deterioration in the relationship between Minoan
and Public Welfare Ecclesiastical Foundation Panagia Akrotiriani, the
landowner of the Cavo Sidero peninsula, which the Company proposes to develop,
as well as the deterioration in the financial position of Minoan. It is this
Director's opinion that both themes have become intertwined.
Relationship between Minoan Group Plc and Public Welfare Ecclesiastical
Foundation Panagia Akrotiriani (the "Foundation")
The last person to person meeting between a board member of Minoan and board
members of the Foundation took place in Athens on 18 June 2024. Whilst
conversations carried on between advisors of the Foundation and Minoan, by 31
December 2024, the contract of the Greek law firm who had acted as Minoan's
adviser in negotiations with the Foundation had ended owing to non-payment.
Indeed, the Greek law firm's final invoice has still not been settled by
Minoan. To reiterate no meetings between Minoan and the Foundation have
occurred in 2025.
The breakdown in the relationship between the Foundation and Minoan culminated
in the Board of Directors of the Foundation sending various letters to the
Board members of Loyalward and Minoan. The first of these was on 6 December
2024. At the end of this letter, the Foundation Board said, "…we are
commencing steps to exercise all our statutory rights and claims under the law
and the Contract". Crucially, there had been no prior written correspondence
from the Foundation to Minoan or Loyalward in which they had revealed they
were considering pursuing legal remedies. Consequently, the dispute is
different in nature to prior disagreements over the % revenue share of the
Project and % of the profit on the share of villa leases between the Company
and the Foundation. Not that these amounts are insignificant.
The Board of Directors of the Foundation, in the 6 December 2024 letter
(Paragraph 5), asked that the Company:
"…must prove that it is able to implement the project by proving evidence of
the company's financial capacity (proof of funds) and specifically company
assets and bank letters of guarantee or any other appropriate document from a
credit institution which shows that it either has or can immediately
(specifying in detail how) secure both the necessary funds required".
Director's Statement and Strategic Review - N J Day (continued)
Minoan did not provide any evidence of its "financial capacity" in its reply
to the Foundation. Not surprisingly, Minoan received a further letter from the
Foundation on 17 March 2025 in which the Board of Directors of the Foundation
said:
"…taking into account developments to date and the new circumstances that
have emerged, as well as your failure to provide the necessary evidence of
your company's financial capacity to undertake and complete the entire
project, we reserve the right to exercise all our legal and contractual rights
and claims."
There can be no guarantee therefore, that the Foundation will not begin formal
legal proceedings against Loyalward and Minoan. To ensure creditors and
shareholders have the fullest understanding of the relationship between Minoan
and the Foundation, the Board of Directors unanimously decided to publish in
full, rather than excerpts thereof, the and version of the letters received by
the Directors of Minoan Group Plc, Loyalward Limited and Loyalward Hellas S.A.
on 6 December 2024 and 17 March 2025 (see letters from The Public Welfare
Foundation Panagia Akrotiarini in Note 21).
Under 3% of all monies spent by Loyalward and Minoan combined since 1991 has
reached the Project's landlord, the Foundation. In aggregate, the payments to
the Foundation amount to £1.4 million yet the Company has spent 20 times this
amount on compensation and travel of Directors combined with the engagement of
so-called Project Consultants. Minoan did not meet "key milestones"
(Environmental Permitting as well as Financial Partnerships and Project
Finance Agreements) set previously for 2024. Both milestones had been set in
the Report of the Directors for the year ended 31 October 2022.
Financial position of the Minoan Group Plc
Minoan has not generated any revenue since the sale of Stewart Travel Limited
in late 2018.
Minoan's shares traded below their par value throughout the course of the
fiscal year 2024. The last time they traded at par value i.e.1p per share was
in August 2023 before DAGG LLP members agreed to convert half of their then
outstanding loan into shares. In the absence of action by Company management
to address the par value issue, Minoan lacked access to the equity market to
raise fresh capital. Indeed, 24 October 2022 is the last date when Minoan was
able to issue new shares to provide fresh capital to fund the business as
opposed to issuing shares in lieu of existing liabilities.
Minoan has announced that following an Event of Default on the secured loan
from DAGG LLP as of 1 January 2025, the interest rate applied to the loan has
risen to 22% per annum from 10% per annum previously. Already in the fiscal
year ending 31 October 2024, fresh unsecured loans to Minoan entailed penal
interest rates with a 150% annualised interest rate charge being the most
noteworthy. It is also important to highlight that the duration of new
unsecured loans granted to Minoan in the last fiscal year shortened
appreciably.
Aside from the "New Loan" by DAGG LLP to Minoan, to cover the necessary
payments to Anstey Bond LLP to allow the audit to proceed, Minoan has not
received any other loan in calendar year 2025. No Letter of Intent or formal
offer has been forthcoming from "a strategic partner" as referred to in
Minoan's RNS of 6 January 2025. At that point in time, "…the Company expects
to be able to provide a further update during the first quarter of 2025".
Neither Tim Hill nor I have been able to prove the existence of said
"strategic partner" referenced as of 6 January 2025.
In the absence of fresh funds, in April 2025 a County Court Judgement was made
in favour of a creditor against Minoan Group Plc and Loyalward Limited. At
Loyalward Hellas S.A., the Company's Greek subsidiary, the picture is even
worse. Monies owed to the Hellenic Republic's tax and social security
authorities have been outstanding such that fines and penalties for overdue
payment are accumulating. To the best of my knowledge, a six-figure sum is due
to the Greek tax and social security authorities by Loyalward Hellas S.A.
whose Greek bank account has been "frozen" for several years.
Since joining the board of Minoan, I have made personally urgent payments to
ensure that key files are still accessible both electronically and physically.
I have ensured also, that the Company could keep its unique London Stock
Exchange ID. Should the DAGG indicative proposal proceed, I have agreed to
write off my entitlement to all Director's fees as a former Director of
Loyalward (through Keith Day & Partners Ltd).
Director's Statement and Strategic Review - N J Day (Continued)
Over eight years have passed since the Greek Supreme Court dismissed appeals
(petitions of annulment) against the Presidential Decree granting land use
approval for the Company's Itanos Gaia project in Crete. This decision was, at
the time (20 June 2017), viewed as a defining moment in the future of Minoan
and the Itanos
Gaia Project itself.
Christopher Egleton, Minoan's Chairman at that time said:
"As a result of the Greek Supreme Court's decision, the Company can now
accelerate the development of the Project, which will include, inter alia, the
continuation of negotiations for joint venture agreements with hoteliers,
investors, partners and other parties.
It also means that our long co-operation with the Foundation Panagia
Akrotiriani, the Municipality of Sitia and the local community can begin to
bring more prosperity to the area".
The reality is that no discernible progress has occurred in the ensuing eight
years despite Minoan having incurred millions of pounds of costs. Opinions may
vary as to what lies behind this failure to progress the Project, but it is an
irrefutable fact.
My limited time as a Minoan board member has led me to question the robustness
of the Company's internal controls. Key documentation both in Greece and the
UK lies, all too often, with third-party consultants rather than with the
Directors of the Company. The past failure to show the two full time employees
at Loyalward Hellas S.A. and the resulting monies owed to the Hellenic
Republic in the form of tax and social security payments is the clearest
example of the failure in internal controls. The Company has not had a Finance
Director since Barry Bartman resigned on 15 February 2022. Minoan has not had
a Managing Director let alone Chief Executive Officer since Duncan Wilson
resigned 9 October 2018.
With access to limited financial resources at Minoan since the sale of the
Stewart Travel Group, whose proceeds did not match those targeted at the
outset of the disposal process, I am surprised that expenditures were not
minimised. Given the lack of alignment in the recent past between Directors
and shareholders, the Board of Directors met on 6 July 2025 and passed
unanimously a resolution ending the Executive Director's Bonus scheme and the
Villa discount Schemes for Management.
Impairment of site value
The decision to impair the site value predates my appointment to the Minoan
board; the minutes of the Audit Committee's March meeting of this year are
clear in this respect.
Going concern
The Board of Directors has agreed unanimously that the Company as currently
constituted is not a going concern. Should the DAGG LLP indicative proposal
fail to advance, Minoan will enter into an insolvency process.
Corporate Governance
The Board supports the principles of good governance. The Group is committed
high standards of corporate governance and has adopted procedures from the
Quoted Companies Alliance Corporate Governance Code to institute good
governance insofar as they are practical and appropriate for a business of the
size of Minoan. The Board has a Renumeration and Audit Committee, in each case
comprising a majority of non- executive directors.
Board effectiveness
The Group supports the concept of an effective Board leading and providing
effective governance over the Group. The board is responsible for approving
Group policy and strategy. It meets regularly and has a schedule of matters
specifically reserved to it for decision. Management supplies the board with
appropriate and timely information and the directors are free to seek any
further information that they consider necessary. In normal circumstances, all
directors' have access to advice from independent professionals at the Group's
expense.
Director's Statement and Strategic Review - N J Day (continued)
Corporate Social Responsibility
The Project is focused strictly on the long-term restoration and preservation
of the environment as a whole and puts in place a sustainable management plan,
involving local representatives and experts, to ensure a robust, pro-active
management system is implemented aimed at protecting the area for future
generations.
Since joining the Minoan Board, I have endeavoured to ensure that the Group is
compliant with all appropriate regulations.
Section 172(1) Statement
The Directors are mindful of their duties under section 172(1) of the
Companies Act 2006, which requires them to act in good faith in a way that
promotes the success of the Group for the benefit of its members as a whole,
and in doing so to have regard (amongst other matters) to:
· the likely consequences of any decision in the long term;
· the interests of the Group's employees;
· the need to foster the Group's business relationships with
suppliers, customers and others;
· the impact of the Group's operations on the community and the
environment;
· the desirability of the Company maintaining a reputation for high
standards of business conduct; and
· the need to act fairly between members of the Group.
During the financial year, the Group did not generate revenue and had under 50
employees. However, the Group holds a significant development asset and
remains actively involved in managing strategic investments and overseeing
ongoing legal, financial and regulatory matters connected with its principal
project in Crete. As such, the Directors' decision-making has remained focused
on protecting asset value and maintaining effective governance and compliance.
Although the Group has few direct employees, the Directors engage with
external advisors, legal counsel, and professional service providers to ensure
that stakeholder considerations, such as legal obligations, environmental
factors, and the interests of shareholders, are reflected in the Group's
actions.
The Board also recognises its responsibility to shareholders and continues to
communicate transparently via regulatory announcements and the AIM
Rule-compliant reporting framework. The Board has also taken into account the
current uncertainty regarding the lease arrangements on the Group's primary
site and continues to act in a manner it believes promotes the long-term value
of the Group and protects stakeholder interests.
N J Day
Director
29 July 2025
Consolidated Statement of Comprehensive Income
Year ended 31 October 2024
2024 2023
£'000 £'000
Revenue - -
Cost of sales - -
Gross profit - -
- -
Operating expenses (658) (536)
Other operating expenses:
Corporate development costs - -
Operating loss (658) (536)
Finance costs (378) 7
Impairment charge (46,258) -
Loss before taxation (47,294) (529)
Taxation - -
Loss after taxation (47,294) (529)
Other Comprehensive income for the year - -
Total Comprehensive income for the year (47,294) (529)
Loss for year attributable to equity holders of the Company (47,294) (529)
Loss per share attributable to equity holders of
the Company: Basic and diluted (5.7)p (0.07)p
Consolidated Statement of Changes in Equity
Year ended 31 October 2024
Year ended 31 October 2024
Share capital Share premium Merger Warrant Retained earnings £'000
£'000 £'000 reserve £'000 Reserve Total
£'000 equity £'000
Balance at 1 November 2023 20,509 36,583 9,349 2,461 (26,712) 42,190
Loss for the year - - - - (47,294)
(47,294)
930 - - - - 930
Issue of ordinary shares at par
Decrease in Warrant Reserve - - - (0) - (0)
21,439 36,583 9,349 2,461 (74,006) (4,174)
Balance at 31 October 2024
Year ended 31 October 2023
Share capital Share premium Merger Warrant Retained earnings £'000
£'000 £'000 reserve £'000 Reserve Total
£'000 equity £'000
Balance at 1 November 2022 20,321 36,583 9,349 2,619 (26,183) 42,689
Loss for the year - - - - (529)
(529)
188 - - - - 188
Issue of ordinary shares at par
Decrease in Warrant Reserve - - - (158) - (158)
20,509 36,583 9,349 2,461 (26,712) 42,190
Balance at 31 October 2023
Consolidated Statement of Financial Position as at 31 October 2024
2024 2023
£'000
£'000
Assets
Non-current assets
Intangible assets 1 3,583
Property, plant and equipment 2 157
Total non-current assets 3 3,740
Current assets
Inventories 6,100 47,995
Receivables 114 117
Cash and cash equivalents 17 17
Total current assets 6,231 48,129
Total assets 6,234 51,869
Equity
Share capital 21,439 20,509
Share premium account 36,583 36,583
Merger reserve account 9,349 9,349
Warrant reserve 2,461 2,461
Retained earnings (74,006) (26,712)
Total equity (4,174) 42,190
Liabilities
Current liabilities 10,408 9,679
Total equity and liabilities 6,234 51,869
Consolidated Cash Flow Statement
Year ended 31 October 2024
2024 2023
£'000 £'000
Cash flows from operating activities
Loss before taxation (47,294) (529)
Finance costs 378 (7)
Decrease/increase) in inventories 41,895 (606)
Impairment of non-current assets 3,737 -
Decrease in receivables 4 50
Increase in current liabilities 795 591
Net cash (outflow) from operations (485) (501)
Finance costs (378) (151)
Net cash used in operating activities (863) (652)
Cash flows from investing activities
Purchase of property, plant and equipment - -
Net cash used in investing activities - -
Cash flows from financing activities
Net proceeds from the issue of ordinary shares 930 188
Loans received/(repaid0 (67) 351
Net cash generated from financing activities 863 539
Net decrease in cash - (113)
Cash at beginning of year 17 130
Cash at end of year 17 17
Notes to the Consolidated Financial Statements
Year ended 31 October 2024
1 General information
The financial information set out in this announcement does not constitute
statutory financial statements for the year ended 31 October 2023 or 31
October 2024. The report of the on the consolidated financial statements of
Minoan Group Plc for the year ended 31 October 2024 did not express an audit
opinion.
The statutory financial statements for the year ended 31 October 2024 have
been delivered to the Registrar of Companies.
The Company is a public limited company incorporated in England and Wales. The
Company's principal activity in the year under review was that of a holding
and management company of a Group involved in the design, creation,
development and management of environmentally friendly luxury hotels and
resorts.
Anstey Bond Disclaimer of Opinion
We were engaged to audit the financial statements of Minoan Group Plc ("the
Parent") and its subsidiaries (''the Group'') for the year ended 31 October
2024 which comprise; the consolidated statement of profit or loss and other
comprehensive income, the consolidated and parent company's statement of
financial position, the consolidated and parent company's statement of changes
in equity, the consolidated and company's statement of cash flows and notes to
the consolidated financial statements, including a summary of significant
accounting policies. The financial reporting framework that has been applied
in their preparation is applicable law and International Financial Reporting
Standards (IFRSs) as adopted by the United Kingdom.
We do not express an opinion on the accompanying consolidated financial
statements of the Group. Because of the significance of the matter described
in the Basis for Disclaimer of Opinion section of our report, we have not been
able to obtain sufficient appropriate audit evidence to provide a basis for an
audit opinion on these consolidated financial statements.
Anstey Bond Basis for Disclaimer of Opinion
We were engaged to audit the consolidated financial statements of Minoan Group
Plc for the year ended 31 October 2024. However, we were unable to obtain
sufficient appropriate audit evidence to provide a basis for an audit opinion.
Our appointment as auditors was formally reconfirmed on 20 June 2025,
following the signing of a new engagement letter and the settlement of
outstanding fees. This occurred several months after the financial year-end.
As a result, our appointment was confirmed later than expected, which in turn
placed certain constraints on the scope of our work. It limited opportunities
to observe year-end procedures, access contemporaneous documentation, and
engage with individuals possessing detailed knowledge of material balances and
key judgments reflected in the financial statements.
Following the financial year-end, the Company experienced notable changes in
its management team, including the departure of the former Chairman and other
directors who had been closely involved with, and possessed detailed knowledge
of, accounting and operational matters relating to key balances. In light of
these transitions and, given the limited financial resources available to seek
external guidance, our ability to obtain explanations or audit evidence in
certain areas - particularly those requiring historical context or prior
judgments - was impacted.
We were unable to obtain direct confirmations or sufficient alternative audit
evidence in respect of certain material trade and other payables, loans and
accruals and deferred charges, totalling a minimum of £2,047,709, £646.808
and £1,236,537 respectively. Management was unable to provide adequate
supporting documentation for these balances, and as such, we were unable to
determine whether any adjustments might be necessary. We were unable to obtain
sufficient appropriate audit evidence to support material accruals
recognised in the consolidated financial statements. Due to the lack of
supporting documentation and clarity regarding the underlying transactions, we
could not determine whether these liabilities were complete or appropriately
valued.
Notes to the Consolidated Financial Statements (continued)
Year ended 31 October 2024
1 General Information (continued)
Anstey Bond Basis for Disclaimer of Opinion (continued)
The Group's statement of financial position includes development property
classified as inventory with a carrying amount of £6.1 million as at 31
October 2024 (2023: £48.0 million). This balance pertains to the Cavo Sidero
Project and is stated net of an impairment charge of £46.3 million recognised
during the year. The impairment was determined by management based on their
internal assessment of the asset's recoverable amount; however, a formal,
independent third-party valuation was not commissioned to support this
assessment as the Company had insufficient funds to pay for a valuation. We
were therefore not provided with sufficient appropriate audit evidence to
support the key assumptions underlying management's valuation and the
resultant impairment charge. Consequently, we were unable to perform
alternative procedures to corroborate the carrying amount of the development
property. As a result, we could not determine whether any adjustments to this
balance were necessary. The inventory relates to a development project
situated on leased land in Crete.
The inventory relates to a 10 development project situated on leased land in
Crete. Further details of the Foundation's concerns pertain to this Minoan
Group Plc (Registered number: 03770602) lease - held by the Foundation as
lessor for the Cavo Sidero Project - which may seek to challenge the Group's
rights as lessee to the land. Further details of this dispute can be found in
the letters included in Note 21. The outcome of this matter will materially
affect the net realisable value of the asset, including the potential non
extension upon expiry of the original lease agreement and therefore the
realisation of the project. Due to both valuation uncertainty and unresolved
legal status, we were unable to conclude on the appropriateness of the
inventory's measurement or classification.
The parent company's balance sheet includes an intercompany receivable of
£4,037,499 due from subsidiary undertakings. Management have not been able to
provide sufficient appropriate audit evidence to support the recoverability of
these balances. In particular, no reliable financial information, cash flow
forecasts, or evidence of the subsidiaries' ability to repay these amounts
were available to us. Due to the lack of supporting documentation and the
absence of sufficient audit evidence, we were unable to determine whether
these intercompany balances are recoverable or whether any impairment is
required. Accordingly, we were unable to determine whether any adjustments to
these balances may have been necessary.
As a direct consequence of the matter described above concerning the Cavo
Sidero Project, we were also unable to obtain sufficient appropriate audit
evidence to support the carrying amount of the parent company's investment in
its subsidiary, Loyalward Limited.
The value of this investment, recorded at £4,002,000 in the parent company
statement of financial position, is wholly dependent on the recoverable amount
of the project's underlying assets. Accordingly, we could not determine
whether any adjustments were required to the carrying amount of the investment
in the subsidiary.
Receivables include a material balance within a Greek subsidiary, Loyalward
Hellas S.A, which was previously immaterial but has become significant due to
changes in group asset values. The subsidiary has not provided sufficient
financial records or evidence to support this and other receivables balances
totalling £101,072, and we were therefore unable to verify its recoverability
or appropriateness for recognition.
In light of the matters outlined above, including challenges in obtaining
sufficient appropriate audit evidence relating to accruals, creditor balances,
prepayments, and inventory valuation, we were consequently unable
Notes to the Consolidated Financial Statements (continued)
Year ended 31 October 2024
1 General Information (continued)
Anstey Bond Basis for Disclaimer of Opinion (continued)
to gain adequate assurance regarding the completeness and accuracy of
expenditure recognised in the consolidated statements of comprehensive income
for the year ended 31 October 2024. Several of these balances have a direct
influence on the consolidated statements of comprehensive income, particularly
in relation to cost of sales, administrative expenses, finance costs, and
impairment charges. Due to limitations in the availability of reliable audit
evidence, continuity in the audit trail, and management explanations, we were
not able to obtain the necessary information to assess whether the reported
results for the year are free from material misstatement. Consequently, this
has contributed to our overall conclusion that we are unable to express an
opinion on the financial statements in their entirety.
Due to the significance of the matters described above, we were unable to
obtain sufficient appropriate audit evidence in respect of several material
areas of the financial statements, a result of these matters, we were unable
to determine whether any adjustments might have been found necessary in
respect of recorded or unrecorded transactions. The potential impact of these
matters is both material and pervasive.
2 Accounting policies
Basis of preparation
The financial statements are prepared under the historical cost convention
except for where financial instruments are stated at fair value and where
impairments have been provided following the consideration of the financial
and commercial position of the Company as detailed below.
Upcoming Standard/Amendment
The International Accounting Standards Board and IFRIC have issued the
following new and revised standards and interpretations with an effective date
after the date of these financial statements, which have been endorsed and
issued by the United Kingdom at 31 October 2024:
Upcoming Standard / Amendment Effective Date Anticipated Impact
IFRS 18 - Presentation and Disclosure in Financial Statements 1 January 2027 Expected to significantly affect the structure and presentation of financial
statements. Under review.
Amendments to IAS 1 - Disclosure of Accounting Policies 1 January 2024 Likely to affect the format and granularity of accounting policy disclosures.
Amendments to IAS 8 - Definition of Accounting Estimates 1 January 2024 Disclosure enhancements expected; no recognition impact anticipated.
Amendments to IFRS 16 - Lease Liability in a Sale and Leaseback 1 January 2024 Not applicable. The Group has not engaged in sale and leaseback transactions.
Going concern
The directors have considered the financial and commercial position of the
Group in relation to its project in Crete (the "Project"). In particular, the
directors have reviewed the matters referred to below.
Following the unanimous approval of a Plenum of the Greek Council of State,
the highest court in Greece, the Presidential Decree granting land use
approval for the Project was issued on 11 March 2016 and was published in the
Government Gazette. The planning rules for the Project are now enshrined in
law. The appeals lodged against the Presidential Decree have been rejected by
the Greek Supreme Court.
Notes to the Consolidated Financial Statements (continued)
Year ended 31 October 2024
2 Accounting policies (continued)
Going concern (continued)
In addition to specific Project related matters as noted above, and as has
been the case in the past, the Group has continued to need to and attempt to
raise capital in order to meet its existing finance and working capital
requirements. However, this financial route has proven impossible to maintain.
Having taken these matters into account, together with the financial position
of the Group, as referred to in the Directors' Statements and the Strategic
Report, the Directors consider that preparation of the consolidated financial
statements on a going concern basis is not appropriate.
Due to the consolidated financial statements not being prepared on a going
concern basis the directors have, as part of the annual review of carrying
values, impaired the following items in line with Net Realisable value:
Group intangible assets - carrying value reduced from £3,583,000 at 31
October 2023 to £1,000 at 31 October 2024.
Group property, plant and equipment - carrying value reduced from £157,000 at
31 October 2023 to £2,000 at 31 October 2024.
Group inventories - carrying value reduced from £47,995,000 at 31 October
2023 to £6,100,000 at 31 October 2024.
Company investments - carrying value reduced from £31,736,000 at 31 October
2023 to £4,002,000 at 31 October 2024.
Company receivables - carrying value reduced from £24,283,000 at 31 October
2023 to £4,025,000 at 31 October 2024.
In view of the above and the Group's inability to raise fresh funds, should
the DAGG LLP indicative proposal fail to advance, Minoan Group Plc will enter
into an insolvency process.
Basis of consolidation
The consolidated financial statements incorporate the financial statements of
the Company and all its subsidiaries as at 31 October 2024 using uniform
accounting policies. The Group's policy is to consolidate the result of
subsidiaries acquired in the year from the date of acquisition to the Group's
next accounting reference date. Intra-group balances are eliminated on
consolidation.
Acquisitions of subsidiaries and businesses are accounted for using the
acquisition method. The consideration for each acquisition is measured at the
aggregate of the fair values of the assets given, liabilities incurred and
equity instruments issued by the Group in exchange for control of the acquired
business. Acquisition related costs are recognised in the consolidated
statement of comprehensive income as incurred.
Critical accounting estimates and judgements
The preparation of the financial statements in accordance with generally
accepted financial accounting principles requires the directors to make
critical accounting estimates and judgements that affect the amounts reported
in the financial statements and accompanying notes. The estimates and
assumptions that have a significant risk of causing material adjustments to
the carrying value of assets and liabilities within the next financial year
are discussed below:
· in capitalising the costs directly attributable to the Project (see
inventories below), and continuing to recognise goodwill relating to the
Project, the directors are of the opinion that the Project will be brought to
fruition and that the carrying value of inventories and goodwill is
recoverable; and
· as set out above, the directors have exercised judgement in
concluding that the Company and Group is not a going concern.
Notes to the Consolidated Financial Statements (continued)
Year ended 31 October 2024
2 Accounting policies (continued)
Goodwill
Goodwill arising on acquisitions represents the difference between the fair
value of the net assets acquired and the consideration paid and is recognised
as an asset.
Goodwill arising on acquisition is allocated to cash-generating units. The
recoverable amount of the cash-generating unit to which goodwill has been
allocated is tested for impairment annually, or on such other occasions that
events or changes in circumstances indicate that it might be impaired. Any
impairment is recognised immediately as an expense and is not subsequently
reversed.
Property, plant and equipment
Property, plant and equipment is stated at historical cost less accumulated
depreciation and any recognised impairment loss.
Depreciation is provided in order to write off the cost of each asset, less
its estimated residual value, over its estimated useful life on a
straight-line basis as follows:
Plant and equipment:
3 to 5 years
Fixtures and fittings:
3 years
Where the carrying amount of an asset is greater than its estimated
recoverable amount, it is written down immediately to its recoverable amount.
Investments
Investments in subsidiaries are stated at cost less any impairment deemed
necessary.
Inventories
Inventories represent the actual costs of goods and services directly
attributable to the acquisition and development of the Project and are stated
at the lower of cost and net realisable value. The Directors review the value
of the balance held at least once a year with a view to impairment.
Foreign currency
A foreign currency transaction is recorded, on initial recognition in
Sterling, by applying to the foreign currency amount the spot exchange rate
between the functional currency and the foreign currency at the date of the
transaction.
At the end of the reporting period:
· foreign currency monetary items are translated using the closing
rate;
· non-monetary items that are measured in terms of historical cost in
a foreign currency are translated using the exchange rate at the date of the
transaction; and
· non-monetary items that are measured at fair value in a foreign
currency are translated using the exchange rates at the date when the fair
value was determined.
Exchange differences arising on the settlement of monetary items or on
translating monetary items at rates different from those at which they were
translated on initial recognition during the period or in previous annual
financial statements are recognised in profit or loss in the period in which
they arise.
When a gain or loss on a non-monetary item is recognised to other
comprehensive income and accumulated in equity, any exchange component of that
gain or loss is recognised to other comprehensive income and accumulated in
equity. When a gain or loss on a non-monetary item is recognised in profit or
loss, any exchange component of that gain or loss is recognised in profit or
loss.
Cash flows arising from transactions in a foreign currency are recorded in
Sterling by applying to the foreign currency amount the exchange rate between
the Sterling and the foreign currency at the date of the cash flow.
Notes to the Consolidated Financial Statements (continued)
Year ended 31 October 2024
2 Accounting policies (continued)
Cash and cash equivalents
Cash and cash equivalents include cash in hand and short-term deposits, with a
maturity of less than three months, held with banks.
Trade and other receivables
Trade and other receivables are recognised initially at fair value and shown
less any provision for amounts considered irrecoverable. They are subsequently
measured at an amortised cost using the effective interest rate method, less
irrecoverable provision for receivables.
Trade and other payables
Trade and other payables are recognised initially at fair value and
subsequently measured at amortised cost using the effective interest rate
method.
Loans
Loan borrowings are recognised initially at fair value net of transaction
costs incurred. Borrowings are subsequently stated at amortised cost and any
difference between the proceeds (net of transaction costs) and the redemption
value is recognised as a borrowing cost over the period of the borrowings
using the effective interest method.
Share-based payments
The Company has granted Options and Warrants to purchase Ordinary Shares. The
fair values of the Options and Warrants are calculated using the Black-Scholes
and Binomial option pricing models as appropriate at the grant date. The fair
value of the Options is charged to profit or loss with a corresponding entry
recognised in equity. This charge does not involve any cash payment by the
Group.
Where Warrants are issued in conjunction with a loan instrument, the fair
value of the Warrants forms part of the total finance cost associated with
that instrument and is released to profit or loss through finance costs over
the term of that instrument using the effective interest method.
Taxation
Current taxes, where applicable, 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 and taking into account deferred taxation. Deferred tax is
computed using the liability method. Under this method, deferred tax assets
and liabilities are determined based on temporary differences between the
financial reporting and tax bases of assets and liabilities and are measured
using enacted rates and laws that will be in effect when the differences are
expected to reverse. Deferred tax is not accounted for if it arises from
initial recognition of an asset or liability in a transaction that at the time
of the transaction affects neither accounting, nor taxable profit or loss.
Deferred tax assets are recognised to the extent that it is probable that
future taxable profits will arise against which the temporary differences will
be utilised.
Deferred tax is provided on temporary differences arising on investments in
subsidiaries except where the timing of the reversal of the temporary
difference is controlled by the Group and it is probable that the temporary
difference will not reverse in the foreseeable future. Deferred tax assets and
liabilities arising in the same tax jurisdiction are offset.
The Group is entitled to a tax deduction for amounts treated as compensation
on exercise of certain employee share options. As explained under "Share-based
payments" above, a compensation expense is recorded in the Group's statement
of comprehensive income over the period from the grant date to the vesting
date of the relevant options. As there is a temporary difference between the
accounting and tax bases a deferred tax asset is recorded. The deferred tax
asset arising is calculated by comparing the estimated amount of tax deduction
to be obtained in the future (based on the Company's share price at the
statement of financial position date) with the cumulative amount of the
compensation expense recorded in the statement of comprehensive income. If the
amount of estimated future tax deduction exceeds the cumulative amount of the
remuneration expense at the statutory rate, the excess is recorded directly in
equity against retained earnings.
Notes to the Consolidated Financial Statements (continued)
Year ended 31 October 2024
3 Information regarding directors and employees
Directors' and key management remuneration
Costs taken to Costs taken to Total
inventories
profit or loss
£'000 £'000 £'000
Year ended 31 October 2024
Fees 56 95 151
Sums charged by third parties for - 215 215
directors' and key management services
56 310 366
Year ended 31 October 2023
Fees 95 90 185
Sums charged by third parties for - 95 95
directors' and key management services
95 185 280
The total directors' and key management remuneration shown above includes the
following amounts in respect of the directors of the Company. No director has
a service agreement with a notice period that exceeds twelve months.
2024 2023
Fees/Sums charged by third parties Fees/Sums charged by third parties
£'000 £'000
C W Egleton (Chairman) 180 60
G D Cook 40 35
T R C Hill 40 35
G Mergos (Resigned 7 March 2024) 16 60
276 190
2024 2023
No. No.
Group monthly average number of persons employed
Directors 7 8
Management, administration and sales 2 2
A revision has been made to the 2023 Group monthly average numbers of persons
employed so as to reflect the fact that two persons were employed in
management, administration and sales.
Notes to the Consolidated Financial Statements (continued)
Year ended 31 October 2024
4 Loss before taxation
The loss before taxation is stated after charging:
2024 2023
£'000 £'000
Depreciation - -
Impairment charge 46,258 -
Auditor's remuneration 48 40
The Impairment charge comprises the following:
Impairment of Inventories
42,576 -
Write-off of accruals
(55) -
Impairment of intangible assets
3,582 -
Impairment of property, plant & equipment 155 -
46,258 -
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