REG - Pod Point Group Hdgs - Half-year Report
30/07/2024 07:00
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RNS Number : 2940Y Pod Point Group Holdings PLC 30 July 2024
30 July 2024
Pod Point Group Holdings PLC (Symbol: PODP)
(the "Company", the "Group" or "Pod Point")
Half-year results for the six months ended 30 June 2024
Good progress against operational milestones and FY24 guidance confirmed
Pod Point Group Holdings PLC, a leading provider of Electric Vehicle ("EV")
charging solutions in the UK, is pleased to announce its interim results for
2024, in line with expectations. The Group is making good progress against
its Powering Up strategic initiatives, particularly with the Home segment
returning to growth, cost restructuring actions and the development of Energy
Flex. 2024 guidance has been maintained despite the more challenging EV
market backdrop.
Melanie Lane, Chief Executive Officer of Pod Point, said:
"Since joining Pod Point in May this year, I have been pleased to see
continued strong progress against the Powering Up strategy and in our Energy
Flex business in particular. We remain on track to deliver against all of
our nine key operational milestones as well as our financial targets for the
current year, with our performance contrasting the weaker than expected
private EV demand so far in 2024."
Key Financials Six months to 30.06.24 Six months to 30.06.23 Period on period change
Revenue £28.1m £30.6m (8.2)%
Adjusted EBITDA((1)) £(8.8)m £(6.8)m (29.4)%
Loss Before Tax £(18.7)m £(32.8)m 43.0%
Closing cash and cash equivalents £29.0m £58.8m £(29.8)m
((1)) See Note 5 for definition of Adjusted EBITDA
Group Highlights
· Installed base of communicating devices rose to 242k units, up 14%
compared to H1 2023. Pod Point maintains its leading position at scale in
the UK
· Revenue declined by 8% with planned reduction in non-core activities
within the UK Commercial segment more than offsetting growth across our core
segments
· Return to growth in the Home segment with revenues up 6.5% for H1
2024 vs. H1 2023, continuing the positive momentum for this core segment
despite a challenging 2024 market
· Following maiden Energy Flex revenues in Q4 2023, £0.2m revenue
generated in H1 2024 (H1 2023: £nil) and on track to deliver 2024 FY guidance
of £0.3m
· Gross margin of 32%, up 200 bps compared to H1 2023 driven by
pricing, operational efficiency and mix
· Adjusted EBITDA loss of £8.8m (H1 2023: loss of £6.8m) driven by
higher legacy overheads in advance of the benefits from the cost reduction
programmes in H2 2024, as well as some investment in the new growth areas of
Energy Flex and International
· H1 2024 Loss Before Tax of £18.7m (H1 2023: £32.8m) including no
further non-cash impairment charges required in H1 2024 (H1 2023: £18.6m),
and exceptional charges of £2.6m relating to the restructuring programme in
2023, and £1.7m provision relating to a supplier in administration
· Healthy cash position of £29.0m (FY 2023: £48.7m) and fully undrawn
£30m EDF credit facility, providing the Group with a robust liquidity
position
· Brand trust of our customers remains high, with improved TrustPilot
score to 4.4 (2023: 4.3)
· The Group has now delivered six of its nine Operational KPIs for the
year and remains on track to deliver all targets during 2024
Focus on UK Home and Workplace, plus Capital Light International
· Successful launch of the Solo 3S (Arch 5), our new OCPP-compliant
chargepoint , delivering a key 2024 objective
· Continued growth in average revenue per install, up 2% to £815
following 7% growth in H1 2023
· New contract wins including Rentokil, Speedwell Group and Avery
Dennison Group, and renewals with Zenith Leasing and TSB
· On track to launch in two international markets in 2024 with units
now successfully certified and in active testing in Spain and France
Drive Energy Flex Value and Recurring Revenue
· Hosted Energy Flex Capital Markets Event, replay available at
www.investors.pod-point.com (http://www.investors.pod-point.com)
· Signed key contracts with EDF and Centrica to enable access to
wholesale markets for Energy Flex trading
· Delivered £211,000 of Energy Flex revenues from local DSO markets,
the smallest of the Energy Flex market segments
· Launch of consumer proposition on track for end of 2024
Cost Out
· Restructuring programme on track, with first and second phase
complete and on course to deliver £6m of annualised savings
· Gross margin up 200bps in H1 2024 (vs H1 2023) on pricing, improved
BOM and mix
· ROI discipline embedded with increasing focus on Customer Lifetime
Value
Financial Summary Six months to 30.06.24 Six months to 30.06.23 Period on period change
£m(1) £m
Total revenue 28.1 30.6 (8.2)%
Home 13.2 12.4 6.5%
UK Commercial 7.5 10.7 (29.9)%
UK Distribution 3.1 3.4 (8.8)%
Owned Assets 4.0 4.1 (2.4)%
Energy Flex 0.2 - n.m.
Gross profit 9.0 9.2 (2.2)%
Gross margin 32% 30% 2ppts
Adjusted EBITDA (8.8) (6.8) (29.4)%
Loss before tax (18.7) (32.8) 43.0%
Closing cash and cash equivalents 29.0 58.8 £(29.8)m
(1)This table presents revenue in £m by segment and in total, and does not
cast due to rounding differences
Headline KPIs Six months to Six months to Period on period change
30.06.24
30.06.23
CO2e avoided through the use of Pod Point's chargepoints (ktonnes) 238 191(1) 24.6%
Home units installed 16,215 15,525 4.4%
Average revenue per Home chargepoint (£) 815 801 1.7%
Total Home chargepoints installed and able to communicate at period end 213,298 188,158 13.4%
Total Commercial units installed and able to communicate at period end 28,442 23,771 19.6%
Total chargepoint units installed and able to communicate at period end 241,740 211,929 14.1%
Energy transferred across our Network (GWh) 259 215 20.5%
(1)Restated to conform to the FY23 methodology
Current trading and outlook
The Group continues to trade in line with expectations, despite private
plug-in vehicle demand remaining weak. The Group is making good progress
against all nine of its operational targets set at the Capital Markets Day in
November 2023.
2024 is a transitional year for the Group, as we execute our restructuring
plan and exit non-strategic business activities. Overall, our guidance for
full year 2024 revenue and adjusted EBITDA is unchanged. Revenues are
expected to be around £60m, with the Group exiting mid-single-digit million
pounds of non-core revenues. Adjusted EBITDA losses are expected to be
around £14m in 2024. We will deliver growth in our core Home segment for
the second half and expect to see significant positive momentum in our Energy
Flex segment as set out in the Energy Flex Capital Market Event earlier this
month.
We maintain our guidance on cash, and expect to end 2024 with around £15m of
cash and to remain undrawn on our £30m credit facility.
Webcast presentation
There will be a webcast presentation for investors and analysts this morning
at 09:00am. Please contact podpoint@teneo.com (mailto:podpoint@teneo.com) if
you would like to attend.
Enquiries:
Pod Point Plc phil.clark@pod-point.com
Melanie Lane, Chief Executive Officer
David Wolffe, Chief Financial Officer
Phil Clark, Investor Relations
Panmure Liberum (Joint Corporate Broker) +44 (0)20 3100 2000
Edward Mansfield, Amrit Mahbubani
Canaccord (Joint Corporate Broker) +44 (0)20 7523 8150
Bobbie Hilliam, Harry Pardoe
Media +44 (0)20 7353 4200 4200 PodPoint@teneo.com (mailto:PodPoint@teneo.com)
Matt Low / Arthur Rogers
(Teneo)
About Pod Point Group Holdings plc
Pod Point was founded in 2009. Driven by a belief that driving shouldn't cost
the earth, Pod Point is building the infrastructure needed to enable the mass
adoption of electric vehicles and to make living with an EV easy and
affordable for everyone. As at 30 June 2024 the company has shipped more than
240k charge points on its network in the UK and is an official charge point
supplier for major car brands.
Pod Point works with a broad range of organisations and customers to offer
home and commercial charging solutions.
Pod Point is admitted to trading on the London Stock Exchange under the ticker
symbol "PODP."
Chief Executive Officer's statement
I am pleased to present my first report as Chief Executive Officer of Pod
Point. Having admired and respected Pod Point for a long time, with its
scaled charging network, reputation of great customer service, diverse
distribution relations and strong brand, I was delighted to join the business
on 1 May. I would like to thank Andy for all his hard work and effort as
interim CEO and look forward to working closely with him in his role of
Chair. Andy and the team did a huge amount of work in the last 12 months in
the formulation of the Powering Up strategy, and we have already started to
see real progress in delivering on our targets in a difficult EV market.
After a challenging period for the business, there are clear signs of
stabilisation and progress evident in our performance during the first half of
2024. This set of results marks the fourth update in a row from Pod Point
where we have maintained or upgraded our financial targets. While our
financial performance today clearly does not represent the potential of Pod
Point, we are steadily building momentum and embedding a culture of
performance.
Our transformation plan is built on three interconnected priorities: focusing
on our core strengths and leveraging them into adjacent markets; driving
customer lifetime value through grid load management services or "Energy Flex"
and recurring revenues; and implementing our cost optimisation programme to
ensure the Group's operating model is set up for success. This new strategy
has received strong support from EDF, our largest shareholder and a key
partner in our international expansion.
I would like to thank all my new colleagues for their warm welcome, their hard
work and their dedication to making Pod Point a great place to work.
Collectively, we have made great progress in the first half of the year, and I
am confident we can make further progress in the months ahead.
Review of H1 2024
We are in the early stage of our transformation and our financial performance
in H1 2024 was in line with our expectations. The delivery of our strategy
will create significant value over the long term, as we move towards both
adjusted EBITDA profitability and positive cash flows. As we laid out at the
2023 Capital Markets Day, 2024 will be a year of transition as we exit some
non-core parts of our business and adjust our cost base; however, in the first
half, we have delivered underlying growth in our core Home segment and
delivered significant positive momentum in our Energy Flex segment.
Powering Up, Pod Point's transformation plan, builds on the Group's core
strengths in its brand, leading market share and broad partnerships. This
strategy prioritises the Home and Workplace segments and developing an Energy
Flex recurring revenue stream to build customer lifetime value, combined with
a significant cost out programme.
We have further enhanced our core strengths during the first half. Our
installed base of connected chargepoints is now over 240,000; our excellent
Trust Pilot scores have improved, and we have launched our new OCPP-compliant
Solo 3S chargepoint in market.
Powering Up: our strategy to deliver significant growth and value
We aim to power up 1 million customers from our current base of over 240,000
and help make living with an EV easy and affordable for everyone. Through
our Powering Up strategy, we are committed to achieving sustainable leadership
in the Home and Workplace markets; bringing our UK strengths into European
markets; and driving customer lifetime value through Energy Flex and recurring
revenues. Our financial performance will be enhanced by improving our cost
position. We have made good progress on all fronts.
Looking ahead
The market has remained soft so far in 2024 and is likely to remain so for the
balance of the year with ongoing consumer uncertainty in anticipation of
potential changes to UK Government policy and ongoing volatility in private
new EV demand. However, the long-term structural demand drivers and need for
electrification remain in place; the UK market should see significant
tailwinds from the zero-emission vehicle ("ZEV") Mandate legislation that
requires automotive manufacturers to materially increase their ZEV sales mix
materially, from 22% in 2024 to 38% by 2027 and 80% by 2030.
Pod Point will focus on the operational execution of our Powering Up strategy,
which will include the orderly exit of some non-core parts of our existing
business. 2024 will be a transition year for the Group, reflecting the impact
of these exits and only a part-year of the anticipated £6m of annualised cost
savings.
I am pleased to confirm that we are maintaining our guidance for 2024 and
remain on track to deliver all nine of our operational KPIs.
Melanie Lane
Chief Executive Officer
Chief Financial Officer's statement
2024 has been a year in which we have focused on executing against the
Powering Up strategy communicated at our Capital Markets Events in November
2023. Our trading and financial performance reflects a combination of
planned exits from some non-core activities and growth in core. We are very
encouraged with the progress made in our transformation and strong delivery
against our 9 key operational milestones.
While our overall revenues were down 8% from £30.6 million to £28.1 million,
we saw our Home business return to growth with revenues increasing by over 6%
from £12.4 million to £13.2 million. This was offset by a 30% reduction in
our Commercial revenues from £10.7 million to £7.5 million, however, this
was a planned decline as we move away some commercial activities and refocus
the core of the business on Home. Following our maiden revenues from Energy
Flex in H2 2023, we continue to make strong progress in this segment and
delivered revenues of £0.2 million in H1 2024.
While revenues declined, our overall gross profit was only down by 2% from
£9.2 million to £9.0 million with gross margin improvements largely
offsetting the revenue decline. Our gross margin percentage improved by a
further 2ppts year-on-year from 30% to 32% as we continue to see the benefits
of our operational efficiency, price optimisation and the strategic focus on
higher margin business units.
Business Segment Review:
In the Home business segment:
· Revenue of £13.2 million was 6.5% up compared to of £12.4 million
in H1 2023.
· The number of Pod Point Home units installed increased to 16,215
versus 15,525 in H1 2023.
· The higher revenue growth drove total gross margin in H1 2024 to
£3.5 million, from £3.4 million in H1 2023.
· Percentage gross margin in H1 2024 decreased by 120 basis points to
26.5% compared to H1 2022 at 27.7%, driven by the IFRS15 deferral of £0.5m
of income related to 5 year warranties offered free of charge to customers as
an acquisition incentive.
In the Commercial business segment:
· Due to the planned exit of non-core customer activities, revenue
decreased by 30% to £7.5 million from £10.7 million in 2023
· Total gross margin in H1 2024 reduced to £2.0 million, compared to
H1 2023 at £2.6 million, a decrease of 23%.
· Percentage gross margin increased by 310 basis points to 27.0% in H1
2024 from 23.9% in H1 2023, due to a shift in the mix of installations toward
higher margin direct sale units.
In the Distribution business segment:
· Revenue decreased by 9% to £3.1 million from £3.4 million in H1
2023, reflecting a reduction in volumes via our Housebuilder channel due lower
housing completions.
· Total gross margin in H1 2024 of £1.9 million, compared to H1 2023
at £2.0 million, a decrease of 5%, less than the decline in line with
revenue as margins improved.
· Percentage gross margin increased slightly by 30 basis points to
59.5% in H1 2024 from 59.2% in H1 2023
In the Owned Asset business segment:
· Following the completed roll-out of the Tesco network, we delivered
consistent revenues of £4.0 million in H1 2024 compared to H1 2023 of
£4.1million.
· Gross margin in H1 2023 to £1.4 million compared to H1 2022 at £1.2
million, an increase of 17%.
· Percentage gross margin in H1 2024 increased by 530 bps to
35.4% compared to H1 2022 of 30.1% due to revenue mix.
In the Energy Flex business segment:
· Revenues of £0.2 million in H1 2024 (H1 2023: £nil) which flowed
directly to gross margin as there are no associated costs of goods sold
Our overhead costs (excluding depreciation and amortisation, share-based
payment charges and exceptional items) were up 10% on last year at £18.4
million, but this does not reflect the benefit of the significant
restructuring and cost reduction initiatives which took place in H1 2024 and
will benefit H2 2024 and into 2025. Indeed, to support new growth initiatives
such as International and Energy Flex there was some overheads investment in
the period.
Overall, the business generated an adjusted EBITDA loss of £8.8 million in H1
2024 (H1 2023: £6.8 million loss).
Administrative expenses excluding impairment charges increased by £4.4
million from £24.3 million in H1 2023 to £28.7 million in H1 2024.
The key factor driving this increase of 18% was an increase of £3.9 million
in exceptional charges, to £4.3 million in H1 2024 from £0.4 million in H1
2023, reflecting the restructuring exercise communicated in FY23 (£2.6
million) and a provision of £1.7 million for the carrying value of stock and
for maintenance obligations arising from Tritium, a supplier in
administration.
During April 2024, Tritium DCFC Limited, the parent entity of a supplier of
rapid charging units to the Group, entered administration. The uncertainty
caused by this situation has led to customers of the Group delaying
installation of Tritium products. There is also uncertainty among
customers as to the timely satisfaction of warranty obligations in respect of
installed units.
The Group has therefore recognised provisions for:
i) The carrying value of Tritium stock on hand which
does not have a committed order (£0.4 million);
ii) £1.3 million relating to the expected future costs
of maintenance and repair services due under existing warranty commitments,
which the Group currently expects to have to fulfil.
We saw a £0.9 million increase in depreciation and amortisation, reflecting
additional investment in the Group's technology.
Share-based payment charges reduced from £2.2 million in H1 2023 to £nil in
H1 2024, reflecting significant credits arising from lapses on employees
leaving the Group.
Unadjusted losses after tax reduced to £18.8 million in H1 2024 (H1 2023:
£33.0 million, including goodwill impairment charges of £18.6 million).
Depreciation and amortisation costs of £6.0 million were incurred in H1 2024
(H1 2023: £5.1 million), while net financing income was £0.5 million,
slightly up from £0.3 million in H1 2023.
Our balance sheet remains strong. Working capital movements have been limited
in H1 2024 across trade and other receivables, inventory and trade and other
payables. Fixed assets grew as we continue to build the software platforms
that will drive future growth.
After further capital investment of £5.9 million, including £5.7 million in
software and product development, and exceptional cash charges of £2.6
million, 2023 year-end cash and cash equivalents were £29.0 million compared
to £48.7 million at the end of 2023.
Closing cash and cash equivalents were £29.0 million at 30 June 2024 (31
December 2023: £48.7 million). Closing net assets were £83.6 million (31
December 2023: £102.3 million).
The £30 million credit facility available from EDF remains undrawn.
Cash outflow from operating activities in H1 2024 increased by £3.8 million
to £12.8 million (H1 2023: £9.0 million). This was primarily due to
administrative expenses as described above.
Cash flow from investing activities had outflows of £5.2 million (H1 2023:
£6.3 million). In both periods the primary factor was investment in
capitalised software development to drive future recurring revenues.
Cash flow from financing activities were an outflow of £1.7 million (H1 2023:
£0.1 million). H1 2023 included inflows of £1.5 million relating to
loans funding the owned asset portfolio.
During H1 2023, transactions with related parties included sale of goods of
£0.1 million (H1 2023: £0.1 million) and purchase of goods of £0.4 million
(H1 2023: £0.1 million). These transactions were undertaken with the
shareholders EDF Energy Customers Limited and its subsidiaries and related
parties.
Principal Risks and Uncertainties
Effective risk management is essential to the achievement of our strategic
objectives and driving sustainable business growth. We aim to maintain an
appropriate balance between protecting the company against specific risks
while being able to encourage appropriate and monitored risk-taking and
innovation that allows us to take advantage of business opportunities.
The Board, as part of its half year processes, considered reports from
management reviewing the principal risks and uncertainties and how these might
evolve during the second half of 2024.
Following this review the Board is satisfied that the Group's principal
risks remain unchanged from those contained in our 2023 Annual Report to bring
to your attention. These are listed below:
1. Dependency on the continuing adoption of and demand for EVs
2. Competition in the industry and market segments in which we operate
3. Delays to Product Development and a failure to innovate
4. High lead times for specific commodities or loss of a major supplier
5. Government and regulatory initiatives with unknown outcomes
6. Health and safety risks related to our products, installation,
maintenance and operation of electrical equipment
7. Potential undetected defects, errors or bugs in our hardware or
software
8. Disruptions to our network and IT systems, including from malware,
viruses, hacking, phishing attacks and spamming
9. Ability to hire and retain key management and other skilled employees
10. Delay or disruption to execution of our international expansion and
Energy Flex plans during a period of cost-optimisation and transformation
11. Value from energy flexibility services could be impacted by regulatory
developments or unexpected changes in customer demand or behaviour
Further details of the Group's principal risks and uncertainties can be
found on pages 76-89 of the 2023 Annual Report, which is available on
https://investors.pod-point.com/ (https://investors.pod-point.com/)
Prospects and outlook
Trading in 2024 has been affected by the slower than expected progress in EV
adoption, especially in the private BEV segment with these customers fully
exposed to the cost of living crisis. There has also been uncertainty around
government policy and the regulatory landscape which may resolve following the
recent election.
Despite these headwinds, the Group maintains its overall guidance for 2024
with revenue expected to be around £60 million, adjusted EBITDA around £14
million, and year end cash position around £15 million with the EDF credit
facility remaining undrawn.
Directors' Responsibilities Statement
We confirm that to the best of our knowledge:
a) The condensed consolidated interim set of financial statements has been
using accounting policies consistent with IFRS as adopted by the UK and in
accordance with IAS 34 "Interim Financial Reporting".
b) The interim management report includes a fair review of the information
required by DTR 4.2.7R (indication of important events during the first six
months and description of principal risk and uncertainties for the remaining
six months of the year); and
c) The interim management report includes a fair review of the information
required by DTR 4.2.8R (disclosure of related party transactions and changes
therein).
By order of the Board
D Wolffe
Director
29 July 2024
Basis of Preparation and General Information
The condensed consolidated interim financial statements for Pod Point Group
Holdings Plc (the Company) and its subsidiaries (together, the Group) have
been prepared using accounting policies consistent with IFRS as adopted by the
UK and in accordance with IAS 34 "Interim Financial Reporting".
The same accounting policies and methods of computation are followed in this
set of condensed consolidated interim financial statements as compared with
the most recent Annual Report. A copy of the statutory accounts for the year
ended 31 December 2023 has been delivered to the Registrar of Companies.
The auditor's report on those accounts was not qualified, did not draw
attention to any matters by way of emphasis and did not contain statements
under Section 498(2) or (3) of the Companies Act 2006.
The condensed consolidated interim financial statements do not constitute the
full financial statements prepared in accordance with International Financial
Reporting Standards (IFRS) as adopted by the UK and have been prepared on a
going concern basis.
The condensed consolidated interim financial statements were approved by the
Board of directors on 29 July 2024
Condensed Consolidated Income Statement Notes Six months ended Six months ended Year ended
30 June 30 June
2024 2023 as restated(1) 31 December
2023
£'000 £'000 £'000
Revenue 28,084 30,614 63,756
Cost of sales (19,048) (21,375) (44,516)
Gross profit 9,036 9,239 19,240
Other income 484 600 1,000
Administrative expenses excluding impairment charges.................... (28,701) (24,346) (51,439)
Operating loss before impairment of intangible assets (19,181) (14,507) (31,199)
Impairment charges relating to intangible assets - (18,645) (53,154)
Operating loss (19,181) (33,152) (84,353)
Finance income 710 542 1,586
Finance costs (204) (205) (418)
Loss before tax (18,675) (32,815) (83,185)
Income tax expense (144) (138) (229)
Loss after tax (18,819) (32,953) (83,414)
Basic and diluted loss per ordinary share 7 £(0.12) £(0.22) £(0.54)
All amounts relate to continuing activities.
All realised gains and losses are recognised in the consolidated income
statement and there is no other comprehensive income. Therefore, no separate
statement of other comprehensive income is presented.
The notes set out below form part of the condensed consolidated interim
financial statements.
(1)The income statement for the six months ended 30 June 2023 has been
re-presented to conform with the 31 December 2023 and 30 June 2024
presentation
Condensed Consolidated Statement of Financial Position
Notes As at As at As at
30 June
30 June
31 December
2024
2023 restated(1)
2023
£'000 £'000 £'000
Non-current assets
Goodwill 9 34,365 58,994 34,365
Intangible assets 9 27,907 35,231 26,735
Property, plant and equipment 4,520 5,619 4,957
Right of use assets 2,364 2,949 2,379
69,156 102,793 68,436
Current assets
Inventories 4,336 6,686 4,524
Trade and other receivables 21,178 16,370 16,809
Contract assets - accrued income 7,093 7,714 6,730
Cash and cash equivalents 29,000 58,766 48,743
61,607 89,536 76,806
Total assets 130,763 192,329 145,242
Current liabilities
Trade and other payables (25,482) (18,803) (22,835)
Contract liabilities - deferred income (14,838) (12,959) (13,398)
Loans and borrowings (1,159) (1,271) (1,272)
Lease liabilities (908) (1,466) (1,095)
Provisions (127) (290) (530)
(42,514) (34,789) (39,130)
Net current assets 19,093 54,747 37,676
Total assets less current liabilities 88,249 157,540 106,112
Non-current liabilities
Loans and borrowings (1,565) (2,821) (2,140)
Lease liabilities (1,547) (1,700) (1,406)
Provisions (1,534) (302) (219)
(4,646) (4,823) (3,765)
Total liabilities (47,160) (39,612) (42,895)
Net assets 83,603 152,717 102,347
Equity
Share capital 156 154 154
Share premium 139,887 139,887 139,887
Shared-based payment reserve 4,874 8,236 8,327
ESOP reserve (1,318) (1,318) (1,318)
Retained earnings (59,996) 5,758 (44,703)
83,603 152,717 102,347
(1)See note 10
Company registration number 12431376
Condensed Consolidated Statement of Changes in Equity
Share Share Share-based payment ESOP reserve Retained Total
capital
premium
reserve
earnings
equity
£'000 £'000 £'000 £'000 £'000 £'000
Balance at 1 January 2022 as previously reported 154 140,057 2,264 (1,318) 58,678 199,835
Restatements(1) - (158) - - 86 (72)
Balance at 1 January 2022 as restated 154 139,899 2,264 (1,318) 58,764 199,763
Loss after tax - (20,211) (20,211)
Issue of shares during the year as restated (158) 158 -
Equity-settled share-based payments - 4,545 4,545
Share issuance costs - (12) - - - (12)
Balance at 31 December 2022 as restated 154 139,887 6,651 (1,318) 38,711 184,085
Loss after tax for H1 23 - (32,953) (32,953)
Share-based payments for H1 23 - 1,585 - 1,585
Balance at 30 June 2023 as restated 154 139,887 8,236 (1,318) 5,758 152,717
Loss after tax for H2 23 - (50,461) (50,461)
Share-based payments for H2 23 - 91 - 91
Balance at 31 December 2023 154 139,887
8,327 (1,318) (44,703) 102,347
Loss after tax for H1 24 - (18,819) (18,819)
Share-based payments for H1 24 2 - (3,453) - 3,526 75
Balance at 30 June 2024 156 139,887 4,874 (1,318) (59,996) 83,603
(1)See note 10 for details of the restatement
Condensed Consolidated Statement of Cash Flows
Notes Six months ended Six months ended Year ended
30 June
30 June
2024
2023 as restated(1) 31 December 2023
£'000 £'000 £'000
Cash flows from operating activities
Loss for the period (18,819) (32,953) (83,414)
Adjustment for non-cash items:
Amortisation of intangible assets 4,517 3,792 8,138
Impairment of customer relationship intangibles - 9,880
Impairment of goodwill 18,645 43,274
Impairment of internally generated intangibles - 235 -
Depreciation of tangible assets 664 656 1,338
Depreciation of right of use assets 825 679 1,378
Share based payment charges 75 1,683 1,676
Tax expense 144 138 229
Interest received (710) (542) (1,586)
Interest paid 204 205 418
Tax paid (144) (138) (229)
Operating cash outflow before changes in working capital (13,244) (7,600) (18,898)
Changes in working capital
Movement in inventories 188 (1,046) 1,116
Movement in trade and other receivables (4,370) 284 (155)
Movement in contract assets - accrued income (363) (1,487) (503)
Movement in trade and other payables 2,642 (1,265) 2,866
Movement in contract liabilities - deferred income 1,440 2,126 2,565
Movement in provisions 911 25 183
Net cash flow used in operating activities (12,796) (8,963) (12,826)
Cash flows from investing activities
Purchase of tangible assets (242) (777) (797)
Development expenditure capitalised (5,689) (6,023) (11,518)
Interest received 710 542 1,586
Net cash flow used in investing activities (5,221) (6,258) (10,729)
Cash flows from financing activities
Proceeds from new borrowings - 1,466 1,466
Loan repayment of principal (690) (666) (1,401)
Loan repayment of interest (84) (84) (166)
Payment of principal of lease liabilities (846) (711) (1,481)
Payment of lease interest (106) (121) (223)
Net cash flows used in financing activities (1,726) (116) (1,805)
Net decrease in cash and cash equivalents (19,743) (15,337) (25,360)
Cash and cash equivalents at beginning of the period 48,743 74,103 74,103
Closing cash and cash equivalents 29,000 58,766 48,743
(1)For details of the restatement see note 10
Consolidated Notes to the condensed financial statements
1. General information
Pod Point Group Holdings plc (referred to as the "Company") is a public
limited company incorporated in the United Kingdom under the Companies Act
2006 and registered in England. Its registration number is 12431376. The
registered address is 222 Gray's Inn Road, London WC1X 8HB.
The principal activity of the Company and its subsidiary undertakings (the
"Group") during the periods presented is that of development and supply of
equipment and systems for recharging electric vehicles. The entire issued
share capital of the Company is admitted to trading on the Main Market of the
London Stock Exchange.
All figures presented in these condensed consolidated interim financial
statements are in £ sterling.
These interim financial statements for the six months ended 30 June 2024 have
been prepared in accordance with IAS 34 Interim Financial Reporting, and
should be read in conjunction with the Group's last annual consolidated
financial statements as at and for the year ended 31 December 2023 ("last
annual financial statements"). They do not include all of the information
required for a complete set of financial statements prepared in accordance
with UK-adopted international accounting standards ("UK-adopted IFRS")
accounting standards. However, selected explanatory notes are included to
explain events and transactions that are significant to an understanding of
the changes in the Group's financial position and performance since the last
annual financial statements.
These condensed consolidated financial statements do not comprise statutory
accounts within the meaning of Section 434 of the Companies Act 2006.
Statutory accounts for the year ended 31 December 2023 have been delivered to
the Registrar of Companies. The auditor has reported on those accounts and
their opinion was (i) unqualified, (ii) did not include any matters to which
the auditor drew attention by way of emphasis of matter without modifying
their opinion, and (iii) did not contain a statement under section 498(2) or
(3) of the Companies Act 2006. These condensed consolidated financial
statements have been reviewed by the Group's auditors pursuant to the Auditing
Practices Board guidance on the Review of Interim Financial Information
(although the comparative figures were not subject to review by the Group's
auditor).
2. Going concern
In adopting a going concern basis for the preparation of the condensed
consolidated interim financial statements, the Directors have made appropriate
enquiries and have considered the Group's business activities, cash flows and
liquidity position, and the Group's principal risks and uncertainties, in
particular economic and competitive risks.
The Directors have taken into account reasonably possible future economic
factors in preparing and reviewing trading and cash flow forecasts covering
the period to 31 July 2025 (the assessment period), being at least over 12
months from the date of approval of these condensed consolidated interim
financial statements. This assessment has recognised the significant loss and
cash outflow in FY2023 and in H1 24, and the actions management has taken and
has planned in FY2024 to implement the Group's change in strategy as set out
above.
The Group is expected to continue to experience negative cash flows in 2024
and 2025, before becoming cash generative in 2027. The Directors are of the
view that the plans in place are realistic and achievable.
This assessment has taken into consideration sensitivity analysis as set out
below and the steps which could be taken to further mitigate costs if
required. Mitigations which are available and entirely within the control of
the Group include a reduction in investment in brand marketing expenditure,
delays in investment in new technology not expected to be in use during the
assessment period, and reductions in expenditure on the Group's support
functions to match any reductions in demand levels. Since the Group's
commitments to carbon emission reductions do not have a significant cost
implication, the impact of climate change has not had a significant effect on
the forecasts considered.
In satisfying themselves that the going concern basis is appropriate, the
Directors have considered the following key sensitivities to the base case
forecast listed below. In assessing the impact of a reasonably possible
downside scenario, the Directors have modelled the combined impact of those
sensitivities set out below.
The Directors consider a scenario where these sensitivities occur in
combination is unlikely, but not remote. A scenario where some of these
sensitivities occur, but not others, would therefore be upsides against the
scenario considered.
i) A sensitivity related to economic risk factors, reflecting a general
reduction in economic confidence or reduction in willingness of individual and
corporate customers to incur discretionary cost, or reduction in expected
rates of adoption of EVs. This sensitivity results in a fall in forecast
revenues of 5% resulting from a decrease in UK installations resulting from
lower than expected market demand for EVs.
ii) A reduction of 1% in revenue during the assessment period due to a
reduction in the Group's ability to apply inflationary price increases.
iii) In addition to sensitivity (i), a further fall in forecast revenues of 5%
resulting from a decrease in
UK installations resulting from lower than expected market share performance
by the Group, due to
realisation of risks arising from competitive pressures or to the Group's own
execution performance.
iv) A sensitivity to supply chain risk, with an increase of 1% in total cost
of sales due to supplier cost
increases which cannot be passed on to customers.
v) A sensitivity reflecting an increase in forecast cashflow outflow during
the assessment period due to a six-month delay in scaling the Energy Flex
business and the International business resulting in a 2% decrease in revenue
through the assessment period
Mitigating actions available to the Group have been considered as follows,
resulting in a 22% overall
reduction in the sensitised cash outflow, arising from actions to delay or
reduce:
i) investment in new product technology (8%);
ii) investment in internal systems (4%); and
iii) to reduce overhead costs including discretionary bonuses (10%).
The severe but plausible downside scenario considered shows, prior to
mitigating actions, a minimal but positive cash position at the end of the
assessment period. The effect of mitigating actions leaves the Group with
positive liquidity throughout the assessment period, without the need for
borrowing to maintain a positive cash position.
In the event of a further downside beyond the severe but plausible scenario
considered, or to offset mitigating actions which may prove ineffective, the
EDF facility is also available to provide £30m of further liquidity headroom
to the Group. The Board has received assurances that EDF Energy Customers
Limited would not seek repayment of the facility within the assessment period,
if doing so would cause the Group liquidity issues.
Given the Group's cash position at 30 June 2024 of £29.0m, and mitigations
available in a downside scenario, the Group expects to maintain a position of
sufficient liquidity throughout the forecast period to at least 31 July 2025.
The level of liquidity available, along with the facility provided by EDF,
means that the Group has the flexibility to address any reasonably possible
change in costs, and the Group does not anticipate the need to seek further
sources of finance during the assessment period. The Directors will re-assess
whether the EDF facility would be required in a severe but plausible downside
scenario at the 2024 year end reporting date based on the Group's H2 24
performance.
In light of the Group's current liquidity and the results of the sensitivity
testing conducted, the Directors are satisfied that the Company, and the Group
as a whole, has sufficient funds to continue to meet its liabilities as they
fall due for at least twelve months from the date of approval of the financial
statements and consequently have prepared the condensed consolidated interim
financial statements on a going concern basis.
3. Accounting policies
The accounting policies and methods of computation followed in these condensed
consolidated financial statements are consistent with those applied during the
year ended 31 December 2023.
There is no significant seasonality or cyclicality of interim operations as
presented. The Group's Energy Flex business is expected to generate
additional returns in Winter compared to Summer, when demand on the energy
grid is higher, however the activity within this segment is not significant in
the periods presented.
Except as set out below, these policies are consistent with those applied in
the six-month period ended 30 June 2023 as previously reported.
A number of new accounting standards and amendments to accounting standards
are effective for annual periods beginning after 1 January 2024, and early
adoption is permitted. The Group has not adopted early any of the
forthcoming new or amended accounting standards in preparing these condensed
consolidated interim financial statements. No significant impact on the
Group's reported results or financial position is currently expected in
respect of these forthcoming new or amended accounting standards.
3.1 Revenue - commercial installation projects
The Group offers a commercial installation service, whereby units are
delivered to and installed at a
specific customer site as agreed on a case-by-case basis.
During the year ended 31st December 2023, management identified that the
previous policy for recognition of revenue arising from commercial
installation contracts did not faithfully reflect the transfer of control of
goods and services to the customer. The Group concluded that the previous
policy did not fully align to the requirements of IFRS 15. The update to the
accounting policy to comply with IFRS 15 is set out below and the application
of the updated policy has resulted in the correction of previously misstated
balances, as set out in note 10.
Previous accounting policy
Previously, costs associated with commercial installation contracts, being
both the cost of units purchased and installation costs, were presented in
inventory as work-in-progress. This work-in- progress balance did not reflect
an asset controlled by the Group, since the installation projects take place
on a customer site, with transfer of control of the installed units to the
customer over time as work is completed.
Previously, revenue was not recognised until invoice for the majority of
projects. For a limited number of larger projects, revenue was accrued based
on customer agreement that key project milestones had been reached.
Under the revised accounting policy, revenue is recognised at the point of
delivery to customer site, for units sold, and over time for installation
services, as these services are provided. Where work takes place ahead of
invoicing, this leads to recognition of a contract asset in the form of
accrued income.
Current accounting policy
The Group has re-assessed that these installation contracts include two
separate performance obligations that are distinct under IFRS 15, the first
being the delivery to the customer of the chargepoint units, and the second
being the service of installation of those units.
In arriving at the assessment that sale of units and installation of units
represents two separate performance obligations, the Group has considered the
fact that the Group sells units as a stand- alone product, with the customer
either installing themselves or separately contracting for installation with a
third party.
The transaction price is allocated to each performance obligation based on the
stand-alone selling prices. Where such stand-alone selling prices are not
directly observable, these are estimated based on expected cost-plus margin.
The Group has assessed that control of units passes to the customer upon
delivery of units to the customer site. Therefore, revenue associated with the
units is recognised at a point in time, upon delivery.
The installation work performed by the Group under commercial installation
contracts has no alternative use. Under these contracts, the Group has an
enforceable right to payment for work done, including if a contract is
cancelled part-way through by a customer.
The installation service is recognised as it is provided over time, with
revenue accrued on an input basis using the costs incurred to date as a ratio
of total expected costs. This approach gives rise to a contract asset in the
form of accrued income, until the relevant amounts are invoiced.
Under this method, actual costs are compared with the total estimated costs to
measure progress towards complete satisfaction of the performance obligation.
To measure the relevant proportion of revenue to recognise, the Group is
required to estimate the margin on contracts in progress at each reporting
date. This estimation is performed on a portfolio basis.
The effect of the change in policy on the results as previously stated is set
out in note 10.
3.2 Taxation
The income tax charge in H1 24 relates to the accrued RDEC tax credit income
for the period.
There is no deferred tax charge for the period, since deferred tax assets are
recognised only up to the level of deferred tax liabilities arising. Since
these assets and liabilities arise only in the UK, and since they therefore
relate to income taxes levied by the same tax authority on the same group of
entities, and since there is an expectation that the tax assets and
liabilities will be realised simultaneously, these assets and liabilities are
netted off in the balance sheets presented.
3.3 Exceptional items
Exceptional items represent amounts which result from unusual transactions or
circumstances, and which in management's view need to be separately disclosed
by virtue of their nature and significance.
In the annual report and accounts for the year ended 31 December 2023, items
that met this definition included large corporate transactions and
restructuring costs.
For these condensed consolidated financial statements, the Directors have
assessed those transactions which should be considered exceptional in
providing more relevant and reliable information and in the period ended 30
June 2024 have included certain warranty and stock provisions related to the
administration of a key supplier.
For clarity going forward, items requiring separate disclosure will be
summarised under the term 'exceptional items'.
The identification of these items is judgemental, and this judgement is made
at Board level. We believe that adjusting for such items presents an
alternative perspective which can improve comparability period on period and
which therefore can represent more relevant and reliable information in
understanding the Group's financial performance. These amounts are adjusted
from alternative performance measures for this reason.
4. Critical accounting judgements and key source of
estimation uncertainty
In the application of the Group's accounting policies, management is
required to make judgements, estimates and assumptions about the carrying
amounts of assets and liabilities that are not readily apparent from other
sources. The estimates and associated assumptions are based on historical
experience and other factors that are considered to be relevant. Actual
results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis.
Revisions to accounting estimates are recognised in the period in which the
estimate is revised if the revision affects only the period or in the period
of the revision and future periods if the revision affects both current and
future periods.
Critical judgements in applying accounting policies
(i) Capitalisation of development costs
Development costs are capitalised where they relate to a qualifying project
and where the relevant costs can be separately identified. The capitalised
development costs are based on management judgements taking into account:
• the technical feasibility to complete the product or system so that it
will be available for use
• management intends to complete the product or system and use or sell it
• the ability to use or sell the product or system
• the availability of adequate technical, financial and other resources to
complete the development
In determining the development costs to be capitalised, the Group estimates
the expected future economic benefits of the respective product or system that
is the result of a development project. Management also make judgements
regarding the level of purchased services which are directly attributable to
the work to develop the capitalised projects and therefore are included within
the overall project costs.
The overall cost of this team is material and a significant change in this
estimate could have a significant effect on the value of costs capitalised.
The impact of a change to this estimate could result, at the most extreme,
i.e. in a scenario where either no development team costs are capitalised, or
where they are capitalised in full, in a decrease of £1.3m or increase of
£5.7m in administrative expenses in the current period.
(ii) Revenue recognition
Contracts are accounted for in accordance with IFRS 15 'Revenue from Contracts
with Customers'. Revenue is recognised as, and when, identified performance
obligations are satisfied. Identifying the performance obligations, and the
relevant method to faithfully reflect the timing of transfer of control of
services to customer, for some contracts, may require management to exercise
judgement.
Performance obligations identified in contracts
In the year ended 31 December 2023, the Group identified that there are
separate performance obligations in respect of Commercial installation
contracts, for the supply of units and the installation of those units. In the
year ended 31 December 2023, the revenue recognition approach to these
contracts has changed in two respects. Firstly, to split the delivery of units
to customer site from the work done to install those units into two
performance obligations, as set out above. Secondly, to recognise contract
assets in the form of accrued income prior to invoicing, based on the
percentage of the total installation project which has been completed. Revenue
accrued also includes the relevant proportion of expected margin to be earned
on the overall project as set out below. If the Group cannot reliably measure
progress of installation services, the Group restricts revenue recognition to
the level of costs incurred. Costs are taken to the income statement as
incurred.
Transfer of control to customers
In the year ended 31 December 2023, management identified that the previous
policy for recognition of revenue arising from commercial installation
contracts did not appropriately reflect the transfer of control of the
installation of the asset to the customer. Previously, including in the six
months ended 30 June 2023 as previously reported, revenue derived from funded
development and large programmes was recognised as milestone obligations were
completed in full. Since many projects did not contain such milestones, for
many projects, this resulted in point-in-time recognition, at the end of an
installation. A work-in-progress inventory asset was recognised on the balance
sheet prior to completion of milestones or invoicing, reflecting costs
incurred by the Group but not margin. This work-in-progress balance did not
reflect an asset controlled by the Group, since the project was on a customer
site.
Under the revised method, actual costs are compared with the total estimated
costs to measure progress towards complete satisfaction of the performance
obligation. To measure the relevant proportion of revenue to recognise, the
Group is required to estimate the margin on contracts in progress at each
reporting date. This estimation is performed on a portfolio basis.
The changes described above resulted in a new contract asset, accrued income,
and the derecognition of a previously presented asset, work in progress. The
revised approach therefore results in earlier recognition of revenue and of
cost of sales. The effect of the change on the prior period is set out within
note 9.
Key source of estimation uncertainty
The following are the key assumptions concerning the future, and other key
sources of estimation uncertainty at the end of the reporting period that may
have a significant risk of causing a material adjustment to the carrying
amounts of assets and liabilities within the next financial year.
(i) Impairment of goodwill and other intangibles
During the year ended 31 December 2023, the Group performed a value-in-use
assessment of the carrying value of goodwill arising on acquisition and
concluded that an impairment of £53.2m was required, primarily relating to
goodwill allocated to the UK Commercial CGU.
At 30 June 2024, the remaining carrying value of goodwill and other
intangibles arising on acquisition has been re-assessed, using a fair value
less costs of disposal ("FVLCOD") approach. The Directors are required to
consider the recoverable amount, being the higher of FVLCOD and value in use
at each reporting date. The Directors consider the FVLCOD approach gives rise
to a higher recoverable value at 30 June 2024.
FVLCOD reflects market inputs or inputs based on market evidence if readily
available. If these inputs are not readily available, the fair value is
estimated by discounting future cash flows modified for market participants'
views.
Since observable market inputs or inputs based on market evidence are not
readily available, management have used a discounted cash flow model to
estimate the FVLCOD of each CGU. The discounted cash flows represent a Level
3 valuation as defined by IFRS 13 Fair Value Measurement.
The Directors have assessed the appropriate basis to determine the recoverable
amount including the growth in adoption of battery electric vehicles ("BEVs")
after 2030, which was the terminal period applied at 31 December 2023. The
Directors consider that an assessment on a FVLCOD basis is a more useful
representation of the recoverable amount when considering the future strategy
of the business, including the impact of continued adoption of BEVs in the UK
market over the medium term.
Management has projected cash flows using Board-approved budgets and forecasts
to 2030. Management has then, for the assessment at 30 June 2024, estimated
a growth rate for the period from 2030 to 2035 of 5.9%, reflecting a further
period of strong growth arising from adoption of BEVs.
This change to include a period longer than 5 years is considered appropriate
given the growth in electric vehicles is expected to increase significantly
beyond 5 years, driven by Government policy initiatives to decarbonise most
transport and increased demand for electric vehicles.
The Group's forecasts have been updated in light of trading in H1 24 and
latest expectations.
The key assumptions in the model remain in line with the Group's November 2023
strategic plan, and include:
i) 15% CAGR in the addressable residential home charging market between 2024
and 2030, and a
40% CAGR growth in the Workplace market over the same period;
ii) 20% cumulative annual growth rate in revenue between 1 January 2024 and 31
December 2027;
iii) A 5 percentage point improvement in gross margin by 2025 and sustained
throughout the
plan period;
iv) A £6m annualised reduction in overhead costs by 2025, offset in later
years by investment in brand
marketing and international expansion; and
v) The Group to become cash generative from 2027.
As well as estimates on future trading performance, key estimation inputs
include the weighted average cost of capital used to discount the estimated
cash flows, and the terminal growth rate applied to cash flows beyond the
specific assessment period. Changes in these assumptions could have led to an
additional impairment charge.
5. Operating segments, revenue and alternative
performance measure
During the second half of the year ended 31 December 2023, the Group undertook
a strategic review, which resulted in a change in the operating segments
reviewed by the Chief Operating Decision Maker ("CODM"). The Group now has six
operating segments, five of which are as set out in the table below.
The results for the six months ended 30 June 2023 have been re-presented
according to the revised segments.
In future, the Group also expects to report activity within an International
segment. However, for all periods presented, trading, assets and liabilities
and cash flows for this segment is immaterial.
Reportable Segment Operations
UK Home Activities generated by the sale of chargepoints for installation at homes in
the UK.
UK Commercial Activities generated by the sale and installation of chargepoints in
commercial settings such as destinations and workplace parking in the UK, as
well as the recurring revenue generated on chargepoints, relating to fees
charged from the ongoing use of the Pod Point software and information
generated from the management information system.
UK Distribution Activities generated by the sale of chargepoints to commercial customers such
as housebuilders and wholesale channels in the UK
Owned Assets Operating activities relating to customer contracts, in which Pod Point owns
the chargepoint assets but charges a fee for provision of media screens on the
chargepoints for advertising purposes, and charges end customers for the use
of these assets.
Energy Flex Activities relating to provision of a flexibility service, to arrange access
to Pod Point's installed base of domestic charging units, distributor network
operators and distribution system operators to manage energy usage in
geographically designated areas over time to match production capacity.
There are no transactions with a single external customer amounting to 10 per
cent. or more of the Group's revenues.
Revenue in all periods presented arises materially all in the United Kingdom.
Costs have been attributed to segments on a specific basis where possible, and
on an activity basis where necessary.
Information relating to assets, liabilities and capital expenditure
information is presented to the CODM in aggregate. Materially all assets and
liabilities were UK based in all periods presented.
Alternative performance measures
The Group makes use of an alternative performance measure, adjusted EBITDA, in
assessing the performance of the business. The definition and relevance of
this measure is set out below. The Group believes that this measure, which is
not considered to be a substitute for or superior to IFRS measures, provides
stakeholders with helpful additional information on the performance of the
Group.
Adjusted EBITDA
Definition
Profit or loss from operating activities, adding back depreciation,
amortisation, impairment charges, share-based payment charges and exceptional
items.
Relevance to strategy
The adjusted measure is considered relevant to assessing the performance of
the Group against its
strategy and plans.
The rationale for excluding certain items is as follows:
• Depreciation: a non-cash item which fluctuates depending on the timing of
capital investment. We
believe that a measure which removes this volatility improves comparability of
the Group's results period on period.
• Amortisation: a non-cash item which varies depending on the timing of and
nature of acquisitions,
and on the timing of and extent of investment in the internally generated
intangibles arising from
development of the Group's products. We believe that a measure which removes
this volatility
improves comparability of the Group's results period on period. Where
applicable, impairment of
intangible assets is also excluded as an exceptional item.
• Share-based payment charges: a non-cash item which varies significantly
depending on the share
price at the date of grants under the Group's share option schemes, and
depending on the
assumptions used in valuing these awards as they are granted. We believe that
a measure which
removes this volatility improves comparability of the Group's results period
on period and also improves comparability with other companies that do not
operate similar share-based
payment schemes.
• Exceptional items: these items represent amounts which result from unusual
transactions or circumstances and of a significance which warrants individual
disclosure to provide reliable and more relevant information on financial
performance. We believe that adjusting for such items improves comparability
period on period.
Other income represents grant income relating to the R&D expenditure
credit for relief on the Group's research and development costs.
Segmental Analysis for the six months ended 30 June 2024:
UK Home UK Commercial UK Distribution Owned Assets Energy Flex Total Group
£'000 £'000 £'000 £'000 £'000 £'000
Installation services - 5,593 - - - 5,593
provided to Commercial customers
Other services provided to customers over time 130 1,503 - 4,009 - 5,642
Wholesale and Supply - 409 3,143 - - 3,552
only sales to Commercial customers at point in time
Sale and installation of 13,086 - - - - 13,086
chargepoints to residential customers at point in time
Energy flex revenues - - - - 211 211
Revenue 13,216 7,505 3,143 4,009 211 28,084
Cost of sales (9,711) (5,476) (1,272) (2,589) - (19,048)
Gross margin 3,505 2,029 1,871 1,420 211 9,036
Gross margin % 26.5% 27.0% 59.5% 35.4% 100% 32.2%
Other income 268 149 63 - 4 484
Administrative expenses (14,721) (9,770) (3,425) (574) (211) (28,701)
excluding impairment charges
Impairment charges - - - - - -
Operating (loss)/profit (10,948) (7,592) (1,491) 846 4 (19,181)
Finance income 397 218 87 - 8 710
Finance costs (59) (35) (15) (94) (1) (204)
(Loss)/profit before tax (10,610) (7,409) (1,419) 752 11 (18,675)
Reconciliation of operating loss to adjusted EBITDA for the six months ended
30 June 2024
UK Home UK Commercial UK Distribution Owned Assets Energy Flex Total Group
£'000 £'000 £'000 £'000 £'000 £'000
Operating (loss)/profit (10,948) (7,592) (1,491) 846 4 (19,181)
Depreciation and amortisation 3,191 1,637 667 465 46 6,006
Impairment charges - - - - - -
Share-based payments charge (5) (4) (2) - - (11)
Exceptional items 2,207 1,421 694 - 21 4,343
Adjusted EBITDA (5,555) (4,538) (132) 1,311 71 (8,843)
Segmental Analysis for the six months ended 30 June 2023:
UK Home UK Commercial UK Distribution Owned Assets Energy Flex Total Group
£'000 £'000 £'000 £'000 £'000 £'000
Installation services - 9,180 - - - 9,180
provided to Commercial customers
Other services provided to customers over time 48 1,549 - 4,052 - 5,649
Wholesale and Supply - - 3,399 - - 3,399
only sales to Commercial customers at point in time
Sale and installation of 12,386 - - - - 12,386
chargepoints to residential customers at point in time
Energy flex revenues - - - - - -
Revenue 12,434 10,729 3,399 4,052 - 30,614
Cost of sales (8,989) (8,165) (1,387) (2,834) - (21,375)
Gross margin 3,445 2,564 2,012 1,218 - 9,239
Gross margin % 27.7% 23.9% 59.2% 30.1% - 30.2%
Other income 370 191 39 - - 600
Administrative expenses excluding impairment charges (14,641) (7,558) (1,530) (617) - (24,346)
Impairment charges - (18,645) - - - (18,645)
Operating (loss)/profit (10,826) (23,448) 521 601 - (33,152)
Finance income 334 173 35 - - 542
Finance costs (74) (39) (8) (84) - (205)
(Loss)/profit before tax (10,566) (23,314) 548 517 - (32,815)
Reconciliation of operating loss to adjusted EBITDA for the six months ended
30 June 2023
UK Home UK Commercial UK Distribution Owned Assets Energy Flex Total Group
£'000 £'000 £'000 £'000 £'000 £'000
Operating (loss)/profit (10,826) (23,448) 521 601 - (33,152)
Depreciation and amortisation 2,871 1,483 300 472 - 5,126
Impairment charges - 18,645 - - - 18,645
Share-based payments charge 1,384 715 145 - - 2,244
Exceptional items 222 114 23 - - 359
Adjusted EBITDA (6,349) (2,491) 989 1,073 -- (6,778)
Segmental Analysis for the year ended 31 December 2023:
UK Home UK Commercial UK Distribution Owned Assets Energy Flex Total Group
£'000 £'000 £'000 £'000 £'000 £'000
Installation services - 19,835 - - - 19.835
provided to Commercial customers
Other services provided to customers over time 135 3,162 - 8,348 - 11,645
Wholesale and Supply - - 5,400 - - 5,400
only sales to Commercial customers at point in time
Sale and installation of 26,837 - - - - 26.837
chargepoints to residential customers at point in time
Energy flex revenues - - - - 39 39
Revenue 26,972 22,997 5,400 8,348 39 63,756
Cost of sales (19,406) (16,943) (2,281) (5,886) - (44,516)
Gross margin 7,566 6,054 3,119 2,462 39 19,240
Gross margin % 28.1% 26.3% 57.8% 29.5% 100% 30.2%
Other income 617 319 64 - - 1,000
Administrative expenses (30,863) (16,094) (3,225) (1,235) (22) (51,439)
excluding impairment charges
Impairment charges - (47,396) (5,758) - - (53,154)
Operating (loss)/profit (22,680) (57,117) (5,800) 1,227 17 (84,353)
Finance income 979 505 102 - - 1,586
Finance costs (136) (70) (14) (198) - (418)
(Loss)/profit before tax (21,837) (56,682) (5,712) 1,029 17 (83,185)
Reconciliation of operating loss to adjusted EBITDA for the year ended 31st
December 2023
UK Home UK Commercial UK Distribution Owned Assets Energy Flex Total Group
£'000 £'000 £'000 £'000 £'000 £'000
Operating (loss)/profit (22,680) (57,117) (5,800) 1,227 17 (84,353)
Depreciation and amortisation 6,106 3,150 638 960 - 10,854
Impairment charges - 47,396 5,758 - - 53,154
Share-based payments charge 1,403 724 146 - - 2,273
Exceptional items 1,729 892 181 - - 2,802
Adjusted EBITDA (13,442) (4,955) 923 2,187 17 (15,270)
6. Exceptional items
Exceptional items, for the purposes of presenting non-IFRS measure of adjusted
EBITDA are as follows:
Six months ended Six months ended Year Ended
30 June
30 June
31 December
2024
2023
2023
£'000 £'000 £'000
Supplier-related costs 1,712 - -
Restructuring costs 2,631 359 2,802
4,343 359 2,802
In FY 23, £2,802k of restructuring costs were incurred, representing
professional fees associated with the strategic review exercise undertaken in
during 2023 and the staff costs arising from executing this restructuring
activity. £346k of these costs related to amounts paid to the former CEO
after he had left his role and associated professional fees.
Included within this amount was a provision of £326k which was recognised at
31st December 2023, to cover the expected costs of staff exits in 2024
resulting from the strategic review exercise which had been communicated to
those affected by the year end. At 30 June 2024, this amount had been spent
in full.
A further £2,631k of restructuring costs were incurred in H1 24, in line with
previously communicated expectations, representing further actions arising
from the strategic review undertaken in 2023, and forming part of the same
overall restructuring exercise. These included additional staff exit costs,
and professional fees and other costs associated with the exit of non-core
segments.
During April 2024, Tritium DCFC Limited, the parent entity of a supplier of
rapid charging units to the Group, entered administration. The uncertainty
caused by this situation has led to customers of the Group delaying
installation of Tritium products. There is also uncertainty among
customers as to the timely satisfaction of warranty obligations in respect of
installed units.
The Group has therefore recognised provisions for:
i) The carrying value of Tritium stock on hand which
does not have a committed order (£428k);
ii) The expected future costs of maintenance and repair
services due under existing warranty commitments, which the Group currently
expects to have to fulfil in place of Tritium if Tritium is unable to fulfil
these as would normally be the case (£1,284k).
Restructuring costs in 2023 related to changes within the senior management
team.
7. Loss per share
Basic earnings per share is calculated by dividing the loss attributable to
the equity holders of the Group by the weighted average number of shares in
issue during the year.
The Group has potentially dilutive ordinary shares in the form of share
options granted to employees. However, as the Group has incurred a loss in all
periods presented, the loss per share is not increased for potentially
dilutive shares.
Six months ended Six months ended Year ended
30 June
30 June
31 December
2024
2023
2023
Loss for the period attributable to equity holders (£'000) 32,953 83,414
18,819
Weighted average number of shares in issue 155,275,651 153,473,724 154,104,570
Loss per share (Basic and Diluted) (£) (0.12) (0.22) (0.54)
8. Related Parties
Transactions with Shareholders
During the six months ended 30 June 2024, the Group had the following
transactions with entities which were part of the EDF Group:
Group Company Sales of goods Purchase of goods
£'000 £'000
EDF Energy Limited 106 -
EDF Energy Customers Limited - 391
During the six months ended 30 June 2023, the Group had the following
transactions with entities which were part of the EDF Group:
Group Company Sales of goods Purchase of goods
£'000 £'000
EDF Energy Limited 138 -
EDF Energy Customers Limited - 143
During the year ending 31 December 2023, the Group had the following
transactions with entities which were part of the EDF Group:
Group Company Sales of goods Purchase of goods
£'000 £'000
EDF Energy Limited - 488
EDF Energy Customers Limited 3 -
Transactions with related parties who are not members of the Group
During H1 2024, the Group had the following transactions with a related party
who is not a member of the Group. Imtech Inviron Limited is a related party by
virtue of their ultimate parent and controlling party being Electricite de
France S.A.:
• Sale of goods of £nil million (H1 2023: £0.2 million, year ended
31 December 2023: £0.2 million)
9. Intangible assets
Development £'000 Brand £'000 Customer relationships £'000 Goodwill £'000 Total £'000
Cost:
At 1 January 2024 27,981 13,940 13,371 77,639 132,931
Additions - H1 24 5,689 - - - 5,689
At 30 June 2024 33,670 13,940 13,371 77,639 138,620
Accumulated amortisation and impairment charges:
At 1 January 2024 (12,456) (2,730) (13,371) (43,274) (71,831)
Amortisation - H1 24 (4,168) (349) - - (4,517)
At 30 June 2024 (16,624) (3,079) (13,371) (43,274) (76,348)
Carrying amounts:
At 30 June 2024 17,046 10,861 - 34,365 62,272
Development £'000 Brand £'000 Customer relationships £'000 Goodwill £'000 Total £'000
Cost:
At 1 January 2023 20,702 13,940 13,371 77,639 125,652
Additions - H1 23 6,023 - - - 6,023
At 30 June 2023 26,725 13,940 13,371 77,639 131,675
Accumulated amortisation and impairment charges:
At 1 January 2023 (10,146) (2,033) (2,599) - (14,778)
Amortisation - H1 23 (2,997) (349) (446) - (3,792)
Impairment - H1 23 (235) - - (18,645) (18,880)
At 30 June 2023 (13,378) (2,382) (3,045) (18,645) (37,450)
Carrying amounts:
At 30 June 2023 13,347 11,558 10,326 58,994 94,225
Development £'000 Brand £'000 Customer relationships £'000 Goodwill £'000 Total £'000
Cost:
At 1 January 2023 20,702 13,940 13,371 77,639 125,652
Additions - 2023 11,518 - - - 11,518
Disposals - 2023 (4,239) (4,239)
At 31 December 2023 27,981 13,940 13,371 77,639 132,931
Accumulated amortisation and impairment charges:
At 1 January 2023 (10,146) (2,033) (2,599) - (14,778)
Amortisation - 2023 (6,549) (697) (892) - (8,138)
Impairment - 2023 - - (9,880) (43,274) (53,154)
Disposals - 2023 4,239 - - - 4,239
At 31 December 2023 (12,456) (2,730) (13,371) (43,274) (71,831)
Carrying amounts:
At 31 December 2023 15,525 11,210 - 34,365 61,100
Impairment review exercise undertaken in 2023
Following the Group's announcement of a change to its strategic priorities
in November 2023, the Group operates reporting segments which are aligned to
those priorities, as set out in note 5. Goodwill and other intangible assets
arising on acquisition were re-allocated from the previous segments to the new
segments during 2023. The goodwill previously allocated to the Commercial
Recurring and Commercial Non-Recurring segments was split between the UK
Commercial and UK Distribution segments based on the 2023 revenue associated
with those segments under the new reporting structure.
As a result of the re-allocation exercise, there was no re-allocation to or
from Home from other segments. No intangible assets were allocated to the
Owned Assets segment, or to the new Energy Flex or International segments.
As a result of the November 2023 strategy change, the Group is exiting certain
commercial markets,
such as Fleet Depot and Public Charging, to focus on Home and Workplace
charging going forward.
During 2023 the Customer Relationships asset was re-assessed in light of the
Group's strategy for its UK Commercial business and the updated cash flows
expected from those customer relationships
identified at initial recognition in 2020. The Directors assessed that the
recoverable value of this
asset on an individual basis at 31st December 2023 was nil and its carrying
value at 31st December 2023 of £9,880k was impaired in full.
For the 2023 annual impairment review of goodwill, CGUs were identified in
line with the new segments. The recoverable amount of each CGU was estimated
on a value-in-use basis, using a discounted cash flow model.
The recoverable amount determined through this value-in-use test identified
impairments in the UK Commercial and UK Distribution segments, totalling
£53.2m. This amount was charged to the income statement within administrative
expenses.
Of this amount, £18.6m had been identified at 30 June 2023 and charged within
administrative expenses at that date. The Directors are of the view that
this charge related entirely to goodwill within the UK Commercial segment.
Impairment review exercise as at 30 June 2024
At 30 June 2024, the remaining carrying value of goodwill and other
intangibles arising on acquisition has been re-assessed, using a fair value
less costs of disposal ("FVLCOD") approach. The Directors are required to
consider the recoverable amount, being the higher of FVLCOD and value in use
at each reporting date. The Directors consider the FVLCOD approach gives rise
to a higher recoverable value at 30 June 2024.
FVLCOD reflects market inputs or inputs based on market evidence if readily
available. If these inputs are not readily available, the fair value is
estimated by discounting future cash flows modified for market participants'
views.
Since observable market inputs or inputs based on market evidence are not
readily available, management have used a discounted cash flow model to
estimate the FVLCOD of each CGU. The discounted cash flows represent a Level
3 valuation as defined by IFRS 13 Fair Value Measurement.
The Directors have assessed the appropriate basis to determine the recoverable
amount including the growth in adoption of battery electric vehicles ("BEVs")
after 2030, which was the terminal period applied at 31 December 2023. The
Directors consider that an assessment on a FVLCOD basis is a more useful
representation of the recoverable amount when considering the future strategy
of the business, including the impact of continued adoption of BEVs in the
UK market over the medium term.
Management has projected cash flows using Board-approved budgets and forecasts
to 2030. Management has then, for the assessment at 30 June 2024, estimated
a growth rate for the period from 2030 to 2035 of 5.9%, reflecting a further
period of strong growth arising from adoption of BEVs.
This change to include a period longer than 5 years is considered appropriate
given the growth in electric vehicles is expected to increase significantly
beyond 5 years, driven by Government policy initiatives to decarbonise most
transport and increased demand for electric vehicles.
The Group's forecasts have been updated in light of trading in H1 24 and
latest expectations.
Key assumptions in the model remain in line with the strategic plan presented
at the Group's Capital Markets Day in November 2023. These assumptions
include future trading estimates which include the size of the UK market for
new charging points, and the Group's forecast market share. The Group's
forecast takes into account its principal risks that may impact the cash
flows, including macroeconomic factors, and has been determined using input
from external advisors as part of the strategic review.
The forecasts are based on management's assessment of future market prospects,
informed by publicly available data published by the UK Government and
Euromonitor as well as proprietary insight from external advisors. The
cashflow forecasts have been informed by the Group's actual trading
performance in H1 24, management's assessment of current and likely future
market conditions, and expectations on future cashflows arising from the
Group's refocused Commercial activities following strategic review. The
forecasts run to 31st December 2030.
Key assumptions include:
i) 15% CAGR in the addressable residential home charging market between 2024
and 2030, and a
40% CAGR growth in the Workplace market over the same period;
ii) 20% cumulative annual growth rate in revenue between 1st January 2024 and
31st December 2027;
iii) A 5 percentage point improvement on 2023 gross margin by 2025 and
sustained throughout the
plan period;
iv) A £6m annualised reduction in overhead costs by 2025, offset in later
years by investment in brand marketing and international expansion; and
v) The Group to become cash generative from 2027.
The Group's Scope 1 and Scope 2 emissions targets for 2026 are not expected
to have a material impact on the future cash flows of the Group.
A post-tax weighted-average cost of capital ("WACC") of 14.3% (2023: 12.7%)
was used to discount
forecast cash flows, along with a terminal growth rate of 1.7% (2023: 1.7%),
based on UK GDP forecasts, to extrapolate cash flows beyond the forecast
period.
The WACC of 14.3% is equivalent to a pre-tax discount rate of 19.1% (2023:
17.0%). Management
considers that the inputs into the WACC model appropriately consider recent
increases to risk-free
rates and the estimated optimal long-term capital structure based on a market
participant's view.
Based on the Directors' assessment of the risks associated with each business
segment, a single
WACC for each segment has been considered appropriate.
The value in use of each of the CGUs is in excess of its carrying value at 30
June 2024.
Sensitivities
Home CGU
The headroom of recoverable value over carrying value of intangible assets in
the Home CGU is £21.5 million at 30 June 2024. A decrease in forecast revenue
CAGR of 23% over the period to 31 December 2030 would be required to cause the
carrying value of the intangible assets within the Home segment to exceed its
recoverable value. A reduction in the expected growth rate between 2030 and
2035 to 1.7% in line with the long term growth rate would reduce the headroom
to £14.1m. A reduction in terminal growth rate to 1.0% from 2035 would
reduce the headroom to £19.8 million.
UK Commercial CGU
The headroom of recoverable value over carrying value of intangible assets in
the UK Commercial CGU is £0.9 million at 30 June 2024. A decrease in forecast
revenue CAGR of 3% over the period to 31 December 2030 would be required to
cause the carrying value of the intangible assets within the UK Commercial
segment to exceed its recoverable value. A reduction in the expected growth
rate between 2030 and 2035 to 1.7% in line with the long term growth rate
would cause an impairment of £1.7m. A reduction in terminal growth rate
from 2035 to 1.0% would reduce the headroom to £0.3 million.
A decrease in forecast revenue CAGR of 55% over the period to 31 December
2030, or an increase in pre-tax discount rate to 27.0%, would be required to
cause the carrying amount of the intangibles assets within the UK Commercial
segment to become zero.
UK Distribution CGU
The headroom of recoverable value over carrying value of intangible assets in
the UK Distribution CGU is £0.3 million at 30 June 2024. A decrease in
forecast revenue CAGR of 1% over the period to 31 December 2030 would be
required to cause the carrying value of the intangible assets within the UK
Distribution segment to exceed its recoverable value. A reduction in the
expected growth rate between 2030 and 2035 to 1.7% in line with the long term
growth rate would cause an impairment of £1.3m. A reduction in terminal
growth rate to 1.0% from 2035 would cause an impairment of £0.1 million.
A decrease in forecast revenue CAGR of 44% over the period to 31 December
2030, or an increase in pre-tax discount rate to 25.4%, would be required to
cause the carrying amount of the intangibles assets within the UK Distribution
segment to become zero.
The Directors have assessed the market capitalisation of the Group as an
indicator of impairment in
the context of the appropriateness of the assumptions applied.
10. Prior period restatement
Commercial revenue accounting
In order to reflect the change in approach to commercial revenue recognition
as set out in the accounting policies note 3 above, costs and revenue relating
to the installation work which had been completed by 31 December 2022 and 30
June 2023 have been recognised.
The adjustment has resulted in commercial installation projects previously
presented as work in progress as at 31 December 2022 and 30 June 2023 being
de-recognised from the balance sheet, and presented within cost of goods sold.
To reflect revenue, accrued income, inclusive of applicable expected margin,
has been recognised as a contract asset, where work had been performed in
advance of invoicing.
At 31 December 2022, WIP has been reduced by £1,702k, accrued income
increased by £1,032k and deferred income reduced by £598k.
At 30 June 2023, WIP has been reduced by £1,326k, accrued income increased by
£974k and deferred income reduced by £280k.
No income statement amounts have been re‑presented in the six months to 30
June 2023, as the effects on revenue, cost of sales, and gross margin are not
significant for the six month period ended 30 June 2023 or the full year ended
31 December 2023.
Balance sheet representation
Presentation of contract assets and contract liabilities
Management have also presented previously existing accrued income and deferred
income balances at 31 December 2022 and 30 June 2023 as separate contract
assets and liabilities, outside of trade and other receivables and trade and
other payables respectively.
The effect at 31 December 2022 was to reduce trade payables by £11,431k and
present the equivalent balance in deferred income, and to reduce trade
receivables by £5,195k and present the equivalent balance as accrued
income.
The effect at 30 June 2023 was to reduce trade payables by £13,239k and
present the equivalent balance in deferred income, and to reduce trade
receivables by £6,740k and present the equivalent balance as accrued
income.
Gross up adjustment
Management have identified a gross up adjustment made as at 30 June 2023 as
previously reported of £5,471k, which increased the reported amounts of trade
and other receivables and trade and other payables respectively. This
adjustment was not appropriate, and has been reversed in the restated figures
for 30 June 2023.
The table below sets out the effect of these changes. No income statement
amounts have been
re‑presented in the six months to 30 June 2023, as the effects on revenue,
cost of sales, and gross
margin are not significant for the six month period ended 30 June 2023 or the
full year ended 31 December 2023.
These restatements have also resulted in changes to the prior year cashflow
statement relating to
working capital movements. The net cashflow from operating activities remains
unchanged.
Presentation of deferred tax assets and liabilities
Historically the Group has presented deferred tax liabilities and assets on
the face of the balance
sheet. Deferred tax assets have been recognised only up to the level of
deferred tax liabilities arising.
Since these assets and liabilities arise only in the UK, and since they
therefore relate to income taxes
levied by the same tax authority on the same group of entities, and since
there is an expectation that the tax assets and liabilities will be realised
simultaneously, these have been netted off at H1 24 and
in the comparative balance sheets presented, including at 30 June 2023 which
has therefore been restated.
Reserves reclassification
During the year ended 31 December 2023, management identified that on exercise
of share-based awards in FY2022 and FY2021, a transfer of share-based payment
charge had been incorrectly made to credit the share premium account. This
transfer should have been made to credit retained earnings, and a correction
has been made as at 31st December 2022.
As previously reported at 30 June 2023 Restatement - commercial revenue accounting Restatement - presentation of contracts assets and liabilities Restatement - gross up adjustment Restatement - deferred tax Restatement - reserves reclassification
£'000 £'000 £'000 £'000 £'000 £'000 As restated at 30 June 2023
£'000
Commercial revenue accounting
Current assets
Inventories 8,012 (1,326) - - - 6,686
Contract assets - accrued income - 974 6,740 - - 7,714
Trade and other receivables 28,572 - (6,740) (5,462) - 16,370
Total impact on current assets (352) - (5,462) - (5,814)
Current liabilities
Contract liabilities - deferred income - 280 (13,239) - - (12,959)
Trade and other payables (37,504) - 13,239 5,462 - (18,803)
Total impact on current liabilities 280 - 5,462 - 5,534
Total impact on net assets (72) - - - (72)
Reserves reclassification
Share premium 140,203 - - - (316) 139,887
Impact of restatements on retained earnings at 30 June 2023 5,514 (72) - - - 316 5,758
Presentation of deferred tax
Non-current assets - deferred tax 5,471 - - - (5,471) -
Non-current liabilities-deferred tax (5,471) - - - 5,471 -
10. Post balance sheet events
There are no post balance sheet events requiring disclosure.
Capital commitments approved by the Board and existing at 30 June 2024
amounted to £310k in respect of a software implementation project (30 June
2023: £nil, 31st December 2023 £nil).
11. Ultimate parent undertaking and controlling party
The immediate parent company of the Company and its subsidiaries is EDF Energy
Customers Limited, a company registered in the United Kingdom.
The immediate parent company of EDF Energy Customers Limited is EDF Energy
Limited, a company registered in the United Kingdom.
In all periods presented, Electricite de France SA, a company incorporated
in France, is regarded by the Directors as the Company's ultimate parent
company and controlling party. This is the largest group for which
consolidated financial statements are prepared. Copies of that company's
consolidated financial statements may be obtained from the registered office
at Electricite de France SA, 22-30 Avenue de Wagram, 75382, Paris, Cedex 08,
France.
INDEPENDENT REVIEW REPORT TO POD POINT GROUP HOLDINGS PLC
Conclusion
We have been engaged by Pod Point Group Holdings plc ("the Company") to review
the condensed set of financial statements in the half-yearly financial report
for the six months ended 30 June 2024 which comprises Condensed Consolidated
Income Statement, Condensed Consolidated Statement of Financial Position,
Condensed Consolidated Statement of Changes in Equity, Condensed Consolidated
Statement of Cash Flows and the related explanatory notes.
Based on our review, nothing has come to our attention that causes us to
believe that the condensed set of financial statements in the half-yearly
financial report for the six months ended 30 June 2024 is not prepared, in all
material respects, in accordance with IAS 34 Interim Financial Reporting as
adopted for use in the UK and the Disclosure Guidance and Transparency Rules
("the DTR") of the UK's Financial Conduct Authority ("the UK FCA").
Basis for conclusion
We conducted our review in accordance with International Standard on Review
Engagements (UK) 2410 Review of Interim Financial Information Performed by the
Independent Auditor of the Entity ("ISRE (UK) 2410") issued for use in the
UK. A review of interim financial information consists of making enquiries,
primarily of persons responsible for financial and accounting matters, and
applying analytical and other review procedures. We read the other
information contained in the half-yearly financial report and consider whether
it contains any apparent misstatements or material inconsistencies with the
information in the condensed set of financial statements.
A review is substantially less in scope than an audit conducted in accordance
with International Standards on Auditing (UK) and consequently does not enable
us to obtain assurance that we would become aware of all significant matters
that might be identified in an audit. Accordingly, we do not express an
audit opinion.
Whilst the company has previously produced a half-yearly report containing a
condensed set of financial statements, those financial statements have not
previously been subject to a review by an independent auditor. As a
consequence, the review procedures set out above have not been performed in
respect of the comparative period for the six months ended 30 June 2023.
Conclusions relating to going concern
Based on our review procedures, which are less extensive than those performed
in an audit as described in the Basis for conclusion section of this report,
nothing has come to our attention that causes us to believe that the directors
have inappropriately adopted the going concern basis of accounting, or that
the directors have identified material uncertainties relating to going concern
that have not been appropriately disclosed.
This conclusion is based on the review procedures performed in accordance with
ISRE (UK) 2410. However, future events or conditions may cause the Group to
cease to continue as a going concern, and the above conclusions are not a
guarantee that the Group will continue in operation.
Directors' responsibilities
The half-yearly financial report is the responsibility of, and has been
approved by, the directors. The directors are responsible for preparing the
half-yearly financial report in accordance with the DTR of the UK FCA.
The annual financial statements of the Group are prepared in accordance with
UK-adopted international accounting standards.
The directors are responsible for preparing the condensed set of financial
statements included in the half-yearly financial report in accordance with IAS
34 as adopted for use in the UK.
In preparing the condensed set of financial statements, the directors are
responsible for assessing the Group's ability to continue as a going
concern, disclosing, as applicable, matters related to going concern and using
the going concern basis of accounting unless the directors either intend to
liquidate the Group or to cease operations, or have no realistic alternative
but to do so.
Our responsibility
Our responsibility is to express to the Company a conclusion on the condensed
set of financial statements in the half-yearly financial report based on our
review. Our conclusion, including our conclusions relating to going concern,
are based on procedures that are less extensive than audit procedures, as
described in the Basis for conclusion section of this report.
The purpose of our review work and to whom we owe our responsibilities
This report is made solely to the Company in accordance with the terms of our
engagement to assist the Company in meeting the requirements of the DTR of the
UK FCA. Our review has been undertaken so that we might state to the Company
those matters we are required to state to it in this report and for no other
purpose. To the fullest extent permitted by law, we do not accept or assume
responsibility to anyone other than the Company for our review work, for this
report, or for the conclusions we have reached.
Mark Wrigglesworth
for and on behalf of KPMG LLP
Chartered Accountants
15 Canada Square
London
E14 5GL
29 July 2024
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