REG - Silver Bullet Data - Results for the year ended 31 December 2021
01/06/2022 07:00
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RNS Number : 4799N Silver Bullet Data Services Grp PLC 01 June 2022
1 June 2022
Silver Bullet Data Services Group plc
("Silverbullet" or the "Company", or, together with its subsidiaries, the
"Group")
Preliminary Results for the year ended 31 December 2021
Silverbullet (AIM: SBDS), a provider of digital transformation services and
products, is pleased to announce its unaudited preliminary results for the
year ended 31 December 2021.
Financial Highlights
Year ended December 2021 Year ended December 2020
Revenue £3.81m £2.79m
Gross Profit £2.79m £1.97m
Headline Loss before tax* £6.10m £4.58m
Reported Loss before tax £8.57m £5.37m
Earnings Per Share (£0.73) (£0.75)
* Headline results are calculated before exceptional items and share option
charges
Operational Highlights
· Successful admission to trading on AIM on 28 June 2021, raising gross proceeds
of £9.5 million.
· Revenue of £3.81 million, up 37 per cent. on 2020.
· 26 new services client wins in the period, including ITV, Venture Crowd and
Edyn.
· Consolidation of existing services clients as a result of additional contract
wins with Channel 4, Heineken and Dolce & Gabbana.
· Significant technical development and enhancements of '4D', Silverbullet's
contextual outcomes engine, including the delivery of a YouTube video
solution.
· 4D campaigns have been successfully delivered for several clients and global
agencies, however 4D revenue has had a slower start than previously
anticipated - largely due to the fact that Google has delayed its final
phasing out of third party cookies by 12 months.
· Further strengthening of strategic and technical teams with valuable new
hires. The senior management team was bolstered by the addition of Kristen
Kelly as Chief Operating Officer.
· Expansion of our 4D-focused US office and offering.
The Company intends to complete a fundraise imminently following the
publication of these results in order to bolster its balance sheet and support
the growth of Silverbullet's 4D product sales during 2022.
Ian James, Chief Executive Officer of Silverbullet, commented:
"2021 was a transformational year for Silverbullet, with the completion of our
IPO in June 2021. The Company has delivered strong performance in marketing
services and is continuing to gain traction with our 4D offering.
"We are operating in a very exciting and relevant space. The value of 1(st)
party data to clients and benefits of 4D, our contextual outcomes engine
designed for a world without third-party cookies, gives us confidence that our
prospects are very encouraging.
"Trading for 2022 has started well, with new customer wins and extensions of
existing contracts, as well as the new joint venture with Making Science which
will create new improved solutions for the privacy-first era. I look forward
to the remainder of 2022 with optimism and we will be updating the market on
progress in due course."
For further information please contact:
Silverbullet via IFC
Ian James (CEO)
Strand Hanson Limited - Financial and Nominated Adviser 0207 409 3494
James Spinney / James Bellman
Oberon Capital - Broker 0203 179 5344
Mike Seabrook
IFC Advisory 020 3934 6630
Graham Herring / Tim Metcalfe / Florence Chandler 07793 839 024
About Silverbullet
Silverbullet's proprietary 4D advertising solution is designed to help
advertisers target consumers in a "post cookie world". The product is a
natural extension to its existing services business which already serves a
blue-chip client base such as Heineken, Channel 4, Amazon and ITV amongst many
others. The removal of third-party cookies has already been implemented by web
browsers such as Firefox and Safari, with Google expected to phase out the use
of cookies in 2023.
Headquartered in London, the Group employs 74 employees across five regions
across the globe, including, the UK, Italy, Germany, Australia and the US. The
Group continues to look at other opportunities for expansion worldwide.
The Company has an established and growing services business with significant
accumulated industry experience and a proven track record of delivering
strategic projects and activation services to its clients. The majority of the
Board have held senior positions at global software companies and have
significant industry experience across data engineering, SAAS product
development and marketing.
The Group has close technical and commercial partnerships with Salesforce,
Oracle and Adobe, all of which have existing sales channels and are already
delivering to clients.
The Group has established a strategic partnership and an entity with Local
Planet, a scaled network of over 60 agencies across the globe. Local Planet
Data Services Limited was established in December 2020 and presents a
significant opportunity to provide data services and the 4D product to the
Local Planet agency network.
CHAIRMAN'S STATEMENT
Silverbullet is a data and digital transformation company that seeks to
deliver future-proofed solutions for the privacy-first, post-cookie era for
marketing and advertising purposes. The Group's core services and products
comprise:
- Data-driven transformational services: first-party data strategy and customer
journey activation advisory services, technology implementation and
integration engineering, alongside adtech and martech managed services. In
short, our expert services help businesses deliver privacy-first,
customer-centric marketing, powered by data.
- '4D' - proprietary contextual data product: a contextual targeting solution
designed to help clients face the challenges posed by the post-cookie era. 4D
enables contextual solutions with a strong focus on online video.
It is my pleasure to present the first annual results of Silver Bullet Data
Services Group Plc as a quoted company. I am extremely pleased with how the
Group has adapted to life as a public company and remained focused on
delivering strong revenue growth and as well as significant development and
results with 4D, our contextual outcomes product. I am delighted to act as
Chairman at such an exciting stage in the Company's development.
Results
Revenue for the year was £3.81m (2020: £2.79m), driven primarily by growth
in our data-driven transformation services business, providing data
consultancy advice to numerous clients across the world. Loss before tax was
£8.57m (2020: £5.37m) leading to a loss per share of 73p (2020: 75p). Net
cash at 31 December 2021 was £3.69m (2020: £0.65m).
People
I am fortunate to work with an experienced and dedicated board of directors.
Keith Sadler brings a wealth of corporate finance knowledge and leads the
Audit and Remuneration committee, where he is joined by Steve Clarke.
Martyn Rattle has significant experience in the Media and Technology space
and provides excellent insights and challenges to the board. I am privileged
to be working with our three Executive Directors, Ian James, Chief Executive
Officer, Umberto Torrielli, Chief Strategy Officer and Darren Poynton, Chief
Financial Officer. I would like to thank them for their focus and dedication
in leading the Company through the IPO this year and driving the company
towards an exciting future.
The Company's true strength is its people, and I would like to thank all our
employees across the globe for their loyalty, determination and skill in
working together in challenging times as a result of the Covid 19 pandemic.
Overview
As a company, we are operating in a very exciting and relevant space. The
value of 1(st) party data to clients and the benefits of 4D, our contextual
outcomes engine in a world without cookies, gives us confidence that our
prospects are very encouraging. The Board will continue to work with the
executive and management teams in 2022 to deliver on our strategy and to
create value for our shareholders.
Nigel Sharrocks
Non-Executive Chairman
CHIEF EXECUTIVE'S STATEMENT
Silverbullet's clear strategy of working with clients to accelerate their
data-driven marketing transformation and providing a contextual product
solution for digital advertising is driving strong growth and future
opportunities for the business.
Marketing Data Transformation Services.
The services business has secured 26 new clients in 2021, and has extended
contracts with several of its existing clients, underpinning the impressive
growth. As well as increasing the number of clients that we work with, we
are also significantly increasing the size of the assignments (average
contract value) and the efficiency of the resource required to deliver success
(improved margins).
A significant proportion of this year's client wins and renewals are with
global blue chip clients who have local operations in multiple geographies and
who operate a broad portfolio of brands. This provides the business with
strong forward looking potential as we unlock these initial central master
service agreements in multiple local operating companies and brand
assignments.
Over the course of the year, the business has reaped the benefit of having
strong strategic partnerships in place with key MarTech vendors including
Salesforce, where Silverbullet works as a preferred services partner, and
Treasure Data (a Softbank company), which works with Silverbullet as its Gold
Partner. This enhances Silverbullet's appeal to potential and current clients
and has opened a significant pipeline of new combined prospects where
Silverbullet and the MarTech vendor will collaborate on new business pitches.
The credibility these partnerships bring underpin Silverbullet's leadership
status in the data-driven transformation space. Being an expert "plumber" of
first party data management technology gives Silverbullet a foundational role
to offer multiple data services to clients for the long term.
During 2021, Silverbullet has chosen to focus on delivering transformation
data services to the Broadcast sector. Broadcasters are undergoing significant
transformation from analogue to digital. Silverbullet has been successful in
winning data technology services contracts with ITV (UK), RTE (Ireland), and
SBS (Australia). The Company is now working with six major broadcasters across
the globe to assist them in transforming their advertising product from linear
to programmatic. As television swiftly moves to be digitally traded and data
enabled, we are proud to be a key partner at the centre of this change.
4D - Proprietary Contextual Data Product
4D is Silverbullet's emerging proprietary contextual data product. After
successful testing in 2021 4D is gaining traction in the market with multiple
clients and agencies. Clients and agencies are using 4D in two key ways:
insight generation on consumer online behaviour, and contextual targeting for
video and display programmatic advertising, all executed in a consumer privacy
first non-cookie based way.
Initial client advertising outcomes using 4D gives us great confidence that
the product has stand-out competitive features and client benefit, however 4D
revenue has had a slower start than previously anticipated. This is largely
due to the fact that Google has delayed its final phasing out of third party
cookies by 12 months, which created confusion and uncertainty in the market.
This phasing out is a key driver in the adoption of alternative insight and
targeting platforms such as 4D. Google has now confirmed that this will occur
in the second half of 2023. The use of cookies has already been discontinued
by Apple and Firefox, so the shift to an alternative market approach is now
firmly in play.
4D has established three key routes to market; 1) Technology Partners such as
Demand-side and Supply-side platforms (DSPs and SSPs); 2) an entity with Local
Planet a global independent media agency network of over 60 agencies; and 3)
Direct Sales to global network media agencies and global clients. These
channels to market provide a solid foundation for scaling what is now a
multi-geography and multi-language product which solves the key problem of
consumer insight and targeting in the privacy-first, post-cookie era.
Investment in Talent
During the year, we have invested in our people, with a focus on expanding our
4D team, with new hires in key product, engineering, customer success and
sales. Our data transformation services team has also expanded, with the
addition of strategic and technical professionals. In 2022, we have launched
our Graduate Scheme focused bringing through the next generation data and
digital talent.
Our already experienced management team, which includes key professionals from the industry, has been recently enhanced by the arrival of Kristen Kelly as Chief Operating Officer. Kristen was formerly President of Precision, EMEA, at Publicis Media.
Outlook
Revenues in Q1 2022 were £0.98m, up 23 per cent. on the previous year. We
have also won five new contracts for our Martech Services business in 2022,
including a significant contract with Mars Inc as its global data services
partner. These new contract wins, together with our expanded client remits
from 2021, is driving growth in 2022. This momentum in the Silverbullet
services division, as well as strong partnerships with Salesforce and Treasure
Data, gives management great confidence for 2022.
The investment in 4D during 2021 has yielded positive client testing results,
and the routes to market that have been established give management confidence
in 4D playing a significant role in the post-cookie advertising ecosystem. As
explained above, 4D revenues are currently behind expectations, due largely to
the delayed implementation of the phase out of third-party cookies by Google,
however this does not change our view that the product will deliver excellent
long-term shareholder value.
It is noted that the Company intends to complete a fundraise imminently
following the publication of these results in order to bolster its balance
sheet and support the growth of Silverbullet's 4D product sales during 2022.
Whilst it is still relatively early in our financial year and the
macro-economic climate is volatile, we are confident of achieving our
expectations for the current financial year.
Ian James
Chief Executive Officer
FINANCIAL REVIEW
A year of great progress for the business in terms of performance, development
and structurally.
Year ended Year ended
December 2021 December 2020
£ £
Revenue 3,809,255 2,788,978
Cost of sales (1,024,221) (821,975)
Gross Profit 2,785,034 1,967,003
Other operating Income 38,328 108,737
Distribution costs (522,306) (431,027)
Administrative expenses (9,988,875) (6,576,740)
Exceptional Items (861,085) (416,615)
Operating Loss (8,548,904) (5,348,642)
Finance Expense (18,928) (25,319)
Loss before taxation (8,567,832) (5,373,961)
Tax 57,150 255,637
Loss after taxation (8,510,682) (5,118,324)
Currency translation differences 36,495 8,002
Total Comprehensive Loss for the year (8,474,187) (5,110,322)
Revenue and Gross Profit
Overall revenue of £3.81m represents growth of 37 per cent. compared to
2020. During 2021, our marketing services division added 26 new clients and
expanded or extended agreements with several existing clients. There was
particular focus on data and strategic services, where revenue grew by 60 per
cent. to £2.30m with strong growth in the UK and Australia. Activation
services provides a key skillset and intelligence for the business, which is
beneficial to both our 4D product and to our data and strategic services
business. We continue to have a significant presence in Italy for activation
services, but the continuing impact of Covid 19 on the local market resulted
in activation services revenues reducing by 3 per cent. in the year.
Our 4D product has developed significantly in 2021. We commenced commercial
trials in Q1 2021 and launched version 1.0 in Q2. In the second half of the
year, we gained traction with agencies and clients in the UK and the US with
further trials and initial bookings. We also provided contextual analysis
and generated a new bookings with a number of Local Planet agencies
coordinated from our joint venture Local Planet Data Services Limited. This
generated revenues in the year of £0.2m. This is slightly slower than we
anticipated, largely due to media agencies delaying testing as a result of
Google's announcement delaying the cookie switch-off date and the impact of
Covid 19 restrictions on the media agencies global workforce.
Gross profit of £2.79m represents growth of 42 per cent. compared to 2020.
Gross profit margin has improved from 71 per cent. to 73 per cent.. This
represents the improved gross margin generated from marketing services, which
is predominately delivered by Silverbullet staff, although this is partly
offset by increased 4D hosting costs.
Operating Expenditure
Total Adjusted Operating Expenditure (Adjusted to exclude depreciation,
amortisation, share option expenses, exceptional items) was £8.36m, which
represents an increase of 36 per cent. from 2020 (£6.14m). Our talented
employees are one of our greatest assets and key to delivering our services
and developing and selling 4D. Staff costs continue to make up the majority of
the operating expenses, with a cost £5.42m (excluding share option expenses).
Opening up our US operation and listing on the AIM market has significantly
increased our costs in 2021. Total IPO and funding costs in 2021 were £1.36m,
£0.52m was included in operating expenses as an exceptional item and £0.84m
has been allocated to the Share Premium account on the balance sheet.
In December 2021, we were the victim of a sophisticated cyber fraud which
resulted in the company losing £0.36m. This is included within exceptional
items. The bank's fraud team have managed to recover £0.02m and we are still
pursuing options in trying to recover additional amounts. Whilst the Company
has solid insurance policies in place around cyber, this crime was not
covered. The Company immediately employed a third-party IT consultancy to
review procedures and implement additional controls and protocols, and we have
also implemented further finance controls and systems.
Taxation
As a loss-making group, we do not currently incur corporation tax. We do
however benefit from a research and development tax relief related to the
development of 4D. The total tax relief for the year was £0.36m.
Balance Sheet and cashflow
4D is a unique and valuable technical product. We have continued to recognise
the development of 4D as an intangible asset, and during the year £1.44m has
been added the development intangible asset account. Goodwill relates to the
acquisition of Silver Bullet Data Services Limited and Videobeet Italia Srl.
We have reviewed the carrying value of these investment and we are comfortable
that no provision is required against these assets.
In preparation for the IPO, the Group's share structure was reorganised. In
May 2021, in order to re-register as a PLC, the company issued a bonus issue
of share capital and reduced the share premium account and resulting in credit
against retained earnings.
Net cash flow used in operating activities was £7.22m (2020: £3.39m). The
increase versus the prior year relates to the development of the 4D commercial
and operational team, investment in martech services talent and an increase in
corporate costs largely as a result of listing on the AIM market.
The Group's net cash balance increased by £3.03m to £3.69 million in 2021
(2020: £0.65m).
The Company intends to complete a fundraise imminently following the
publication of these results in order to bolster its balance sheet and support
the growth of Silverbullet's 4D product sales during 2022.
Darren Poynton
Chief Financial Officer
Consolidated statement of comprehensive income
Group
Note 2021 2020
Continuing operations £ £
Revenue 3, 4 3,809,255 2,788,978
Cost of sales (1,024,221) (821,975)
Gross profit 2,785,034 1,967,003
Other operating income 5 38,328 108,737
Distribution costs (522,306) (431,027)
Administrative expenses (9,988,875) (6,576,740)
Exceptional items 6 (861,085) (416,615)
Operating (loss) 7 (8,548,904) (5,348,642)
Finance expense 10 (18,928) (25,319)
(Loss) before taxation (8,567,832) (5,373,961)
Taxation 11 57,150 255,637
(Loss) after taxation attributable to the equity shareholders of the company (8,510,682) (5,118,324)
Other comprehensive income / (loss) net of taxation
Currency translation differences 36,495 8,022
Total comprehensive (loss) for the year (8,474,187) (5,110,302)
Total comprehensive (loss) attributable to:
Equity shareholders of the company (8,479,438) (5,110,302)
Non-controlling interest 5,251 -
(8,474,187) (5,110,302)
Earnings per share
Basic earnings 25 (0.73) (0.75)
Diluted earnings 25 (0.73) (0.75)
Consolidated statement of financial position
Group Company
2021 2020 2021 2020
Note £ £ £ £
Non-current assets
Goodwill 12 4,349,662 4,330,222 - -
Intangible assets 12 2,206,742 1,242,717 - -
Investments 13 - - 6,872,911 5,270,836
Tangible assets 14 42,115 36,940 - -
Total non-current assets 6,598,519 5,609,879 6,872,911 5,270,836
Current assets
Trade and other receivables 16 2,264,972 1,723,280 78,522 -
Cash and cash equivalents 17 3,687,809 654,792 60 -
Total current assets 5,952,781 2,378,072 78,582 -
Total Assets 12,551,300 7,987,951 6,951,493 5,270,836
Current liabilities
Trade and other payables 18 2,609,028 3,272,101 2,049,262 1,719,420
Loans and other borrowings 19 16,061 - - -
Total current liabilities 2,625,089 3,272,101 2,049,262 1,719,420
Non-current liabilities
Loans and borrowings 19 143,644 188,570 - -
Deferred tax liability 20 547,892 223,921 - -
Total non-current liabilities 691,536 412,491 - -
Total liabilities 3,316,625 3,684,592 2,049,262 1,719,420
Net assets 9,234,675 4,303,359 4,902,231 3,551,416
Equity
Share capital 22 134,227 8,256 134,227 8,256
Share premium 22 8,639,593 35,387,853 8,639,592 35,387,855
Share option reserve 23 1,275,363 1,192,653 1,275,363 1,192,653
Retained Earnings (811,354) (32,240,404) (5,147,001) (33,037,348)
Capital redemption reserve 50 - 50 -
Foreign exchange reserve (8,505) (44,999) - -
Equity attributable to the equity shareholders of the company 9,229,374 4,303,359 4,902,231 3,551,416
Non-controlling interest 5,301 - - -
Total equity 9,234,675 4,303,359 4,902,231 3,551,416
Consolidated statement of cash flows
Group Company
2021 2020 2021 2020
Note £ £ £ £
Cash flows from operating activities
(Loss) after tax from continuing operations (8,510,682) (5,118,324) (12,054,638) (7,261,201)
Adjustments for:
Depreciation 14 36,255 16,704 - -
Amortisation 12 475,809 363,225 - -
Impairments 12 - 417,625 11,815,479 7,261,201
Foreign exchange 36,495 8,022 - -
Net finance expense 10 18,928 25,319 - -
Taxation expense 11 (57,150) (255,637) - -
(Increase) in trade and other receivables 16 (541,692) (413,022) (78,522) -
(Decrease) / increase in trade and other payables 18 (841,335) 812,042 317,741 -
Share option charge 23 1,602,025 376,921 - -
Increase in deferred tax liability 20 323,971 122,580 - -
Cash used in operations (7,457,376) (3,644,545) 60 -
Taxation (paid) / refunded 235,412 256,548 - -
Net cash used in operating activities (7,221,964) (3,387,997) 60 -
Cash flows from investing activities
Purchase of tangible assets 14 (41,430) (25,473) - -
Purchase of intangible assets 12 (1,459,274) (1,057,416) - -
Acquisition of non-controlling interest 50 - - -
Net cash used in investing activities (1,500,654) (1,082,889) - -
Cash flows from financing activities
Proceeds from borrowings 19 - 111,459 - -
Repayment of borrowings 19 (28,865) - - -
Loans to directors - (150,000) - -
New equity issued (net of transaction costs) 11,803,428 4,932,593 - -
Interest paid (18,928) (25,319) - -
Net cash from / (used in) financing activities 11,755,635 4,868,733 - -
Net increase in cash and cash equivalents 3,033,017 397,847 60 -
Cash and cash equivalents at beginning of period 654,792 256,945 - -
Cash and cash equivalents at end of period 3,687,809 654,792 60 -
Consolidated statement of changes in equity attributable to the shareholders
Group
Share Capital Share premium Share Option Reserve Retained earnings Capital redemption reserve Foreign exchange reserve Total equity attributable to shareholders Non-controlling interest Total equity
£ £ £ £ £ £ £ £ £
As at 1 January 2020 4,507 28,581,634 815,732 (27,122,080) - (53,021) 2,226,772 - 2,226,772
Total comprehensive loss for the year - - - (5,118,324) - 8,022 (5,110,302) - (5,110,302)
Shares issued during the year 3,749 6,806,219 - - - - 6,809,968 - 6,809,968
Share option charge - - 376,921 - - - 376,921 - 376,921
As at 31 December 2020 8,256 35,387,853 1,192,653 (32,240,404) - (44,999) 4,303,359 - 4,303,359
Total comprehensive loss for the year - - - (8,515,932) - 36,494 (8,479,438) 5,251 (8,474,187)
Non-controlling interest in subsidiary share capital - - - - - - - 50 50
Share buyback and cancellation (50) - - - 50 - - - -
Bonus issue of shares 87,255 (87,255) - - - - - - -
Capital reduction - (38,425,667) - 38,425,667 - - - - -
Share option charge - - 1,602,025 - - - 1,602,025 - 1,602,025
Share options exercised 312 19,111 (469,533) 469,533 - - 19,423 - 19,423
Share options forfeited/lapsed - - (1,049,782) 1,049,782 - - - - -
Shares issued during period (net of transaction costs) 38,454 11,745,551 - - - - 11,784,005 - 11,784,005
As at 31 December 2021 134,227 8,639,593 1,275,363 (811,354) 50 (8,505) 9,229,374 5,301 9,234,675
Company
Called up Share Capital Share premium Share Option Reserve Retained earnings Capital redemption reserve Total equity
£ £ £ £ £ £
As at 1 January 2020 4,507 28,577,139 815,732 (25,776,147) - 3,621,231
Total comprehensive loss for the year - - - (7,261,201) - (7,261,201)
Shares issued during the year 3,749 6,810,716 - - - 6,814,465
Share option charge - - 376,921 - - 376,921
As at 31 December 2020 8,256 35,387,855 1,192,653 (33,037,348) - 3,551,416
Total comprehensive loss for the year - - - (12,054,638) - (12,054,638)
Share buyback and cancellation (50) - - - 50 -
Bonus issue of shares 87,255 (87,255) - - - -
Capital reduction - (38,425,667) - 38,425,667 - -
Share option charge - - 1,602,025 - - 1,602,025
Share options exercised 312 19,111 (469,533) 469,533 - 19,423
Share options forfeited/lapsed - - (1,049,782) 1,049,782 - -
Shares issued during period (net of transaction costs) 38,454 11,745,551 - - - 11,784,005
As at 31 December 2021 134,227 8,639,595 1,275,363 (5,147,004) 50 4,902,231
Notes to the financial statements
1. Description of business, basis of preparation and going
concern
GENERAL INFORMATION
Silver Bullet Data Services Group PLC ("SBDS") was incorporated on 13 May
2013. SBDS is a public limited company incorporated in England and Wales and
domiciled in the UK. The address of the registered office is Studio 44 The
Finsbury Business Centre, 40 Bowling Green Lane, London, EC1R 0NE.
SBDS is the ultimate parent company to the subsidiaries listed at Note 15,
together referred to as "the Group". The principal activity of the SBDS Group
is marketing services through the application of big data technologies to
reduce friction.
Silver Bullet Data Services Group PLC is registered with Companies House
(Company Number: 08525481).
BASIS OF PREPARATION
These financial statements have been prepared in accordance with UK-adopted
International Accounting Standards, interpretations issued by the
International Financial Reporting Standards Interpretations Committee
("IFRIC"), and the Companies Act 2006. The accounting policies have been
applied consistently throughout the period.
The Company has taken advantage of the exemption under S408 of the Companies
Act 2006 not to include a separate Statement of Comprehensive Income as group
statements have been prepared.
The consolidated financial statements have been prepared under the historical
cost convention. Historical cost is generally based on the fair value of the
consideration given in exchange for assets.
The presentational currency of the Group is GBP with functional currencies of
the subsidiaries disclosed at Note 15 being GBP, EUR, AUD, and USD.
GOING CONCERN
The directors have prepared detailed budgets and forecasts covering the period
to 31 December 2024 which are based on the strategic business plan. These take
into account all reasonably foreseeable circumstances and include
consideration of trading results, cash flows and the level of facilities the
group requires on a month-by-month basis.
Whilst the directors have plans in place to manage any reasonably foreseeable
circumstances, there will be the need for additional funding in the
short-term. The directors are confident that the Group will be able to raise
any required funds to meet their strategic objectives however there remains
uncertainty over how much funding may be raised when required.
Based on their enquiries and the information available to them and taking into
account the other risks and uncertainties set out herein, the directors have a
reasonable expectation that the company and the group has adequate resources
to continue operating for the foreseeable future. Thus, they continue to adopt
the going concern basis of accounting in preparing this financial information.
2. Significant accounting policies
REVENUE RECOGNITION
IFRS 15 - Revenue from Contracts with Customers has been applied for all
periods presented within the financial statements. The timing of all revenue
recognised by the Group during the reporting period was satisfied over time in
accordance with IFRS 15 recognition criteria. None of the Group's activities
result in the transfer of control of a product at a point in time for revenue
recognition purposes.
During the period under review the Group recognised revenue from the following
activities:
Data and strategic services
Revenue relating to service contracts is invoiced according to milestones
defined within each contract, the terms of which vary on a case-by-case basis.
In all cases the revenue is recognised in line with the provision of the
services or, where the quantum and timing of the services cannot be reliably
predicted, rateable over the period of the agreement.
Invoices against services contracts are raised on a monthly basis with
adjustments for accrued or deferred income where the agreed invoicing
timescale does not match the valuation of provision of services.
Activation channels and brand intelligence
Amounts received or receivable for campaigns, typically invoiced on a monthly
basis, recognise revenue in proportion to the quantum of advertising units
delivered according to the contracted service. Units and metrics deliverable
under each contracted services will vary on a case-by-case basis.
Contract liabilities
Contract liabilities are recognised when payment from a customer is received
in advance of performance obligations being satisfied. Contract liabilities
are recognised in trade and other payables.
BUSINESS COMBINATIONS
Silver Bullet Data Services Group PLC applies the acquisition method of
accounting to account for business combinations in accordance with IFRS 3,
'Business Combinations'.
The consideration transferred for the acquisition of a subsidiary is the fair
values of the assets transferred, the liabilities incurred and the equity
interests issued by Silver Bullet Data Services Group PLC. The consideration
transferred includes the fair value of any asset or liability resulting from a
contingent consideration arrangement. Identifiable assets acquired and
liabilities and contingent liabilities assumed in a business combination are
measured initially at their fair values at the acquisition date. The excess of
the consideration transferred over the fair value of Silver Bullet Data
Services Group PLC's share of the identifiable net assets acquired is recorded
as goodwill. All transaction-related costs are expensed in the period they are
incurred as exceptional operating expenses.
TAXES
Corporation tax, where payable, is provided on taxable profits at the current
rate.
Deferred tax is provided on all temporary differences at the reporting date
between the tax bases of assets and liabilities and their carrying amounts for
financial reporting purposes.
Deferred tax assets are recognised for all deductible temporary differences,
carry-forward of unused tax assets and unused tax losses, to the extent that
it is probable that taxable profit will be available against which the
deductible temporary differences, and the carry-forward of unused tax assets
and unused tax losses can be utilised. The carrying amount of deferred tax
assets is reviewed at each balance sheet date and reduced to the extent that
it is no longer probable that sufficient taxable profit will be available to
allow all or part of the deferred tax asset to be utilised.
Deferred tax assets and liabilities are offset when there is a legally
enforceable right to offset current tax assets against current tax
liabilities, and when the deferred tax assets and liabilities relate to taxes
levied by the same taxation authority on either the taxable entity or
different taxable entities where there is an intention to settle the balances
on a net basis.
Deferred tax assets and liabilities are measured at the tax rates that are
expected to apply to the year when the asset is realised or the liability is
settled, based on tax rates (and tax laws) that have been enacted or
substantively enacted at the balance sheet date.
FOREIGN CURRENCY TRANSLATION
Transactions in currencies other than the functional currency (foreign
currencies) are initially recorded at the exchange rate prevailing on the date
of the transaction.
Monetary assets and liabilities denominated in foreign currencies are
translated at the rate of exchange ruling at the reporting date. Non-monetary
assets and liabilities denominated in foreign currencies are translated at the
rate ruling at the date of the transaction, or, if the asset or liability is
measured at fair value, the rate when that fair value was determined.
All translation differences are taken to profit or loss, except to the extent
that they relate to gains or losses on non-monetary items recognised in other
comprehensive income, when the related translation gain or loss is also
recognised in other comprehensive income.
INTANGIBLE ASSETS AND GOODWILL
Goodwill
Goodwill is initially measured at fair value, being the excess of the
aggregate of the consideration transferred over the fair value of the net
assets acquired, and any previous interest held over the net identifiable
assets acquired and liabilities assumed. After initial recognition, goodwill
is measured at cost less any accumulated impairment losses. The goodwill is
tested annually for impairment irrespective of whether there is an indication
of impairment.
For the purposes of impairment testing, goodwill is allocated to the
cash-generating units expected to benefit from the acquisition.
Cash-generating units to which goodwill has been allocated are tested for
impairment at least annually, or more frequently when there is an indication
that the unit may be impaired. If the recoverable amount of the
cash-generating unit is less than the carrying amount of the unit, the
impairment loss is allocated first to reduce the carrying amount of any
goodwill allocated to the unit and then to the other assets of the unit
pro-rata on the basis of the carrying amount of each asset in the unit.
Intangible assets (other than goodwill)
Intangible assets acquired separately from a business are recognised at cost
and are subsequently measured at cost less accumulated amortisation and
accumulated impairment losses. Intangible assets acquired on business
combinations are recognised separately from goodwill at the acquisition date
if the fair value can be measured reliably.
Amortisation is recognised so as to write off the cost or valuation of assets
less their residual values over their useful lives on the following bases:
Brand names - Reducing balance basis over 5 years
Development costs - Straight line basis over 5 years
Customer lists - Straight line basis over 4 years
PROPERTY PLANT AND EQUIPMENT
Property, plant and equipment are stated at cost net of accumulated
depreciation and accumulated impairment losses. Cost comprises purchase cost
together with any incidental costs of acquisition.
Depreciation is provided to write down the cost less the estimated residual
value of all tangible fixed assets by equal instalments over their estimated
useful economic lives on a straight-line basis. The following rates are
applied:
Computer equipment - Straight line over 3 years
Fixtures, fittings and equipment - Reducing balance over 4 years
IMPAIRMENT OF NON-CURRENT ASSETS
At each reporting period end date, the Group reviews the carrying amounts of
its tangible and intangible assets to determine whether there is any
indication that those assets have suffered an impairment loss. If any such
indication exists, the recoverable amount of the asset is estimated in order
to determine the extent of the impairment loss (if any). Where it is not
possible to estimate the recoverable amount of an individual asset, the
company estimates the recoverable amount of the cash-generating unit to which
the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value in
use. In assessing value in use, the estimated future cash flows are discounted
to their present value using a pre-tax discount rate that reflects current
market assessments of the time value of money and the risks specific to the
asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated
to be less than its carrying amount, the carrying amount of the asset (or
cash-generating unit) is reduced to its recoverable amount. An impairment loss
is recognised immediately in the statement of comprehensive income.
Recognised impairment losses are reversed if, and only if, the reasons for the
impairment loss have ceased to apply. Where an impairment loss subsequently
reverses, the carrying amount of the asset (or cash-generating unit) is
increased to the revised estimate of its recoverable amount, but so that the
increased carrying amount does not exceed the carrying amount that would have
been determined had no impairment loss been recognised for the asset (or
cash-generating unit) in prior years. A reversal of an impairment loss is
recognised immediately in profit or loss.
RESEARCH AND DEVELOPMENT EXPENDITURE
Research expenditure is written off against profits in the year in which it is
incurred. Identifiable development expenditure is capitalised to the extent
that the technical, commercial and financial feasibility can be demonstrated.
Development costs relate to a number of platforms developed internally by the
group which are expected to generate future revenue streams.
FINANCIAL INSTRUMENTS
Silver Bullet Data Services Group PLC classifies financial instruments, or
their component parts, on initial recognition as a financial asset, a
financial liability or an equity instrument in accordance with the substance
of the contractual arrangement. Financial instruments are recognised on the
date when the Group becomes a party to the contractual provisions of the
instrument. Financial instruments are recognised initially at fair value plus,
in the case of a financial instrument not a fair value through profit and
loss, transaction costs that are directly attributable to the acquisition or
issue of the financial instrument. Financial instruments are derecognised on
the settlement date when the Group is no longer a party to the contractual
provisions of the instrument.
Non-derivative financial instruments comprise trade
and other receivables, cash and cash equivalents, loans and borrowings, and
trade and other payables.
Trade and other receivables and trade and other payables
Trade and other receivables are recognised initially at transaction price less
attributable transaction costs. Trade and other payables are recognised
initially at transaction price plus attributable transaction costs. Subsequent
to initial recognition they are measured at amortised cost using the effective
interest method, less any expected credit losses in the case of trade
receivables. If the arrangement constitutes a financing transaction, for
example if payment is deferred beyond normal business terms, then it is
measured at the present value of future payments discounted at a market rate
of interest for a similar debt instrument.
Contract assets
Contract assets are recognised when revenue is recognised but payment is
conditional on a basis other than the passage of time. Contract assets are
included in trade and other receivables.
Interest-bearing borrowings
Interest-bearing borrowings are recognised initially at the present value of
future payments discounted at a market rate of interest. Subsequent to initial
recognition, interest-bearing borrowings are stated at amortised costs using
the effective interest method.
Cash and cash equivalents
Cash and cash equivalents comprise cash balances and call deposits. Bank
overdrafts that are repayable on demand form an integral part of the Group's
cash management and are included as a component of cash and cash equivalents
for the purpose only on the cash flow statement.
PROVISIONS
A provision is recognised in the statement of financial position when the
Group has a present legal or constructive obligation as a result of a past
event, that can be reliably measured and it is probable that an outflow of
economic benefits will be required to settle the obligation. Provisions are
determined by discounting the expected future cash flows at a pre-tax rate
that reflects risks specific to the liability. Where the effect of the time
value of money is material, the amount expected to be required to settle the
obligation is recognised at present value. When a provision is measured at
present value, the unwinding of the discount is recognised as a finance cost
in profit or loss in the period in which it arises.
EMPLOYEE BENEFITS
During the period the Group operated a defined contribution money purchase
pension scheme under which it pays contributions based upon a percentage of
the members' basic salary. The Group also paid other employee benefits
including medical insurance.
All employee benefits are charged to the Statement of Comprehensive Income and
differences between contributions payable in the year and contributions
actually paid are shown as either accruals or prepayments.
LEASES
The Group leases a number of properties in various locations in Europe,
Australia, USA, and the UK from which it operates.
All leases are accounted for by recognising a right-of-use asset and a lease
liability except for:
- Leases of assets below £1,000; and
- Leases with a duration of twelve months or less.
All leases signed by the Group during the reporting period were for a period
of less than twelve months so no right-of-use assets have been recognised.
GRANT INCOME
Grant income is recognised where there is reasonable assurance that the grant
will be received, and all attached conditions will be complied with. When the
grant relates to an expense item, it is recognised as income on a systematic
basis over the periods that the related costs, for which it is intended to
compensate, are expensed. When the grant relates to an asset, it is recognised
as income in equal amounts over the expected useful life of the related asset.
SHARE-BASED PAYMENTS
The Group operates a share option programme which allows employees of the
subsidiary companies to be granted options to purchase shares in this company.
The fair value of options granted is recognised as an employment expense with
a corresponding increase in equity.
The fair value of the options is measured at the grant date and spread over
the vesting period. The fair value is measured based on an option pricing
model taking into account the terms and conditions upon which the instruments
were granted.
Vesting periods in each share option agreement vary from vesting immediately
on grant date to vesting over a period of four years.
EXCEPTIONAL ITEMS
Where items of income and expense included in the statement of comprehensive
income are considered to be material and exceptional in nature, separate
disclosure of their nature and amount is provided in the financial statements.
These items are classified as exceptional items. The Group considers the size
and nature of an item both individually and when aggregated with similar items
when considering whether it is material, for example impairment of intangible
assets or restructuring costs.
FINANCE INCOME AND EXPENSES
Finance expenses comprise interest payable and leases liabilities recognised
in the statement of comprehensive income using the effective interest method,
and unwinding of the discount on provisions.
Interest income and interest payable are recognised in the statement of
comprehensive income as they accrue, using the effective interest method.
ADOPTION OF NEW AND REVISED STANDARDS
The following standards and interpretations relevant to the Group are in issue
but are not yet effective and have not been applied in the financial
statements. In some cases these standards and guidance have not been endorsed
for use in the United Kingdom.
· IAS 1 Presentation of liabilities as current or non-current
· IAS 1 Disclosure of accounting policies
· IAS 8 definition of accounting estimates
· Interest rate benchmark reform - IFRSs 7,9 and 16
The above standards are not expected to materially impact the Group.
CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS
The preparation of these financial statements requires the Directors to make
estimates and judgements that affect the reported amounts of assets,
liabilities, costs and revenue in the financial statements. Actual results
could differ from these estimates. The judgements, estimates and associated
assumptions are based on historical experience and other factors that are
considered to be relevant.
Key sources of estimation uncertainty that could cause an adjustment to be
required to the carrying amount of assets or liabilities within the next
accounting period are:
Critical accounting estimates:
Depreciation and amortisation
The assessment of the useful economic lives, residual values and the method of
depreciating or amortising tangible and intangible (excluding goodwill) fixed
assets requires judgement. Depreciation and amortisation are charged to profit
or loss based on the useful economic life selected, which requires an
estimation of the period and profile over which the group expects to consume
the future economic benefits embodied in the assets. Useful economic lives and
residual values are re-assessed, and amended as necessary, when changes in
their circumstances are identified.
Capitalised development costs
Development costs incurred in building the Group's key platform for future
expansion have been capitalised in accordance with the requirements of IAS38.
The majority of these costs consist of salary expenses to which an estimated
proportion of development time has been applied.
Critical accounting judgements:
Impairment of trade receivables
The Group's policy on recognising an impairment of the trade receivables
balance is based on a review of individual receivable balances, their ageing
and management's assessment of realisation. This review and assessment is
conducted on a continuing basis and any material change in management's
assessment of trade receivable impairment is reflected in the carrying value
of the asset.
Impairment of intangible and tangible fixed assets
Impairment tests have been undertaken in respect of goodwill, intangible and
tangible fixed assets using an assessment of the value in use of the
respective cash generating units (CGUs). This assessment requires a number of
assumptions and estimates to be made including the allocation of assets of
CGUs, the expected future cash flows from each CGU and also the selection of a
suitable discount rate in order to calculate the present value of those cash
flows. Impairments of intangible assets are explained in more detail at note
12.
Going concern
As discussed more fully in the Directors' Report these financial statements
have been prepared on the going concern basis. This treatment is based on
management's judgement that cashflow requirements for the continued
development can be achieved through operating activities and through
additional fundraising if required.
3. Operating segments
IFRS 8 requires that operating segments be identified on the basis of internal
reporting and decision-making. The Group has three key business segments
outlined below. The business analyses these streams by revenue and gross
margin. Overheads, assets and liabilities are not separately allocated
across the business streams.
The business monitors operating segment profitability using their Earnings (or
Profit) Before Interest, Tax, Depreciation and Amortisation (EBITDA). This is
used as a metric to represent operating cashflow generated by the business.
2021 2020
Revenue Gross profit Revenue Gross profit
£ £ £ £
Data and Strategic services 2,298,352 2,277,430 1,439,559 1,465,320
Activation services 1,304,153 618,220 1,337,589 529,173
4D outcomes engine 206,750 (110,616) 11,830 (27,490)
Total 3,809,255 2,785,034 2,788,978 1,967,003
EBITDA from continuing operations
Operating (loss) (8,548,903) (5,348,642)
Depreciation and amortisation 512,065 379,929
Total (8,036,838) (4,968,713)
4. Geographical analysis
Revenue analysed by geographical market:
2021 2020
£ £
United Kingdom 1,078,128 826,365
Rest of Europe 1,901,162 1,611,819
Rest of the world 829,965 350,794
3,809,255 2,788,978
The timing of all revenue recognised by the Group during the reporting period
was satisfied over time in accordance with IFRS 15 recognition criteria. None
of the Group's activities result in the transfer of control of a product at a
point in time for revenue recognition purposes.
One major customer is included within data strategic services revenues
totalling £497,717 (2020: £338,879).
Non-current assets analysed by geographical market:
2021 2020
£ £
United Kingdom 6,586,473 5,609,879
Rest of Europe 4,104 16,233
Rest of the world 7,942 3,194
6,598,519 5,629,306
5. Other operating income
Group
2021 2020
£ £
Grant income 38,328 108,737
38,328 108,737
6. Exceptional items
Group
2021 2020
£ £
Professional fees on initial public offering 520,180 -
Losses incurred as a result of fraud 340,905 -
Goodwill and asset impairment - 398,186
Business combination expenses - 18,429
861,085 416,615
7. Operating (loss)
The operating loss is arrived at after
charging/(crediting):
Group
2021 2020
£ £
Depreciation of property plant and equipment 37,348 16,704
Amortisation of intangible assets 475,809 363,225
Impairment of intangible assets - 417,625
Transaction costs on acquisition - 18,429
Auditor's remuneration in respect of:
- audit of the consolidated financial statements 60,000 -
- other audit related assurance services 166,250 -
739,408 815,983
8. Staff costs
Group
2021 2020
£ £
Wages and salaries 4,523,434 3,275,550
Share-based payments 1,602,025 376,921
Social security costs 715,282 480,589
Pension costs - defined contribution 129,079 69,486
Termination payments 56,272 -
7,026,091 4,202,547
Average number of staff
Group Company
2021 2020 2021 2020
Platforms 34 13 - -
Services 23 20 - -
Central 12 8 - -
69 41 - -
9. Directors' remuneration
Key management personnel are considered to be the
directors and their remuneration, employer's national insurance, and pension
contributions are disclosed below:
Group
2021 2020
£ £
Directors' remuneration 957,855 445,233
Share-based payments 376,994 -
Social security costs 97,494 46,585
Pension costs - defined contribution 19,589 7,711
Invoiced services 46,650 119,000
1,498,582 618,529
The directors are remunerated, in respect of their services to the Group,
through subsidiary companies. During the year four directors (2020: three)
were accruing benefits under the company defined contribution pension scheme.
Remuneration disclosed above includes the following amounts paid to the
highest paid director:
Group
2021 2020
£ £
Directors' remuneration 273,375 170,208
Share-based payments 104,901 -
Social security costs 36,507 22,282
Pension costs - defined contribution 5,438 5,100
Invoiced services 30,000 110,000
10. Finance expenses
Group
2021 2020
£ £
On bank overdrafts and loans 16,926 12,591
On other credit arrangements 2,002 12,728
18,928 25,319
11. Income tax provision
A deferred tax asset in respect of the Group's losses
to date has not been recognised due to the uncertainty of the timing of future
loss relief.
Group
2021 2020
Current tax £ £
UK corporation tax relief on losses from prior years (21,121) (212,773)
UK corporation tax relief on losses for current year (360,000) (165,536)
Foreign taxation - 92
Total current tax (381,121) (378,217)
Deferred tax 323,971 122,580
Total tax (credit) / charge (57,150) (255,637)
Reconciliation of tax expense
The tax assessed on the loss on ordinary activities for the year is lower than
the standard rate of corporation tax in the UK of 19% (2020: 19%).
Group
2021 2020
£ £
Loss on ordinary activities before taxation (8,567,832) (5,373,961)
Loss on ordinary activities by rate of tax (1,627,888) (1,021,053)
Non-allowable expenses 139,632 3,174
Enhanced R&D expenditure (360,000) (165,536)
Impairments not deductible for tax purposes - 70,988
Change in deferred tax rate applied 131,494 -
Deferred tax movement on intangible assets 323,971 122,580
Movement in deferred tax not recognised 1,356,762 946,891
Adjustments in respect of prior periods (21,121) (212,773)
Foreign taxation - 92
Tax on loss (57,150) (255,637)
12. Goodwill and intangible assets
Customer lists Development Costs Brand Names Goodwill Total
£ £ £ £ £
COST
At 1 January 2020 595,708 754 84,999 4,703,843 5,385,304
Additions - 1,057,416 - - 1,057,416
Write off - - (84,999) (373,621) (458,620)
At 31 December 2020 595,708 1,058,170 - 4,330,222 5,984,100
At 1 January 2020 595,708 1,058,170 - 4,330,222 5,984,100
Additions - 1,439,834 - 19,440 1,459,274
At 31 December 2021 595,708 2,498,004 - 4,349,662 7,443,374
AMORTISATION
At 1 January 2020 64,936 - 23,995 - 88,931
Amortisation charge 148,927 197,298 17,000 - 363,225
Write off - - (40,995) - (40,995)
At 31 December 2020 213,863 197,298 - - 411,161
At 1 January 2020 213,863 197,298 - - 411,161
Amortisation charge 148,927 326,882 - - 475,809
At 31 December 2021 362,790 524,180 - - 886,970
NET BOOK VALUE
At 31 December 2020 381,845 860,872 - 4,330,222 5,572,939
At 31 December 2021 232,918 1,973,824 - 4,349,662 6,556,404
Amortisation is charged within administrative
expenses in the Statement of Comprehensive Income.
13. Investments
Investments in subsidiary companies Total
£ £
COST
At 1 January 2020 4,727,913 4,727,913
Additions 542,923 542,923
At 31 December 2020 5,270,836 5,270,836
At 1 January 2020 5,270,836 5,270,836
Additions 1,602,075 1,602,075
At 31 December 2021 6,872,911 6,872,911
Impairment review of investments
Using the assumptions applied in reviewing intangible assets for impairment
(see Note 12) the Company's investments in subsidiaries have also been
compared to the discounted future cashflows expected from the subsidiary CGUs.
At the period end no impairment charges (2020: £nil) were necessary given the
headroom below:
Net Book Value Recoverable Amount Impairment Headroom
As at 31 December 2020 £ £ £
Investments in subsidiaries 5,270,836 11,917,340 6,646,504
5,270,836 11,917,340 6,646,504
As at 31 December 2021
Investments in subsidiaries 6,872,911 30,380,747 23,507,836
6,872,911 30,380,747 23,507,836
14. Tangible assets
Fixtures, fittings and equipment Computer equipment Total
£ £ £
COST
At 1 January 2020 10,066 81,197 91,263
Acquisition of subsidiaries 3,606 21,868 25,474
At 31 December 2020 13,672 103,065 116,737
At 1 January 2021 13,672 103,065 116,737
Additions 1,770 39,660 41,430
Disposals (7,145) - (7,145)
At 1 December 2021 8,297 142,725 151,022
DEPRECIATION
At 1 January 2020 7,726 55,367 63,093
Acquisition of subsidiaries 2,958 13,746 16,704
At 31 December 2020 10,684 69,113 79,797
At 1 January 2021 10,684 69,113 79,797
Charge for the period 1,434 34,821 36,255
Disposals (7,145) - (7,145)
At 1 December 2021 4,973 103,934 108,907
NET BOOK VALUE
At 31 December 2020 2,988 33,952 36,940
At 31 December 2021 3,324 38,791 42,115
Depreciation is charged to administrative expenses within the Statement of
Comprehensive Income.
15. Investments in subsidiaries
As at 31 December 2021 Silver Bullet Data Services Group PLC owned a
controlling interest in the ordinary share capital of the companies below.
All subsidiaries are 100% subsidiaries with the sole exception of Local Planet
Data Services Ltd which is 51% owned by the Group.
Subsidiary undertaking Country of incorporation Registered office Principal activity
Silver Bullet Media Services Limited England and Wales Studio 44 The Finsbury Business Centre, 40 Bowling Green Lane, London, EC1R Marketing services and data technologies
0NE
IOTEC Native Limited England and Wales Studio 44 The Finsbury Business Centre, 40 Bowling Green Lane, London, EC1R Dormant
0NE
Silver Bullet Data Services Limited England and Wales Studio 44 The Finsbury Business Centre, 40 Bowling Green Lane, London, EC1R Marketing services and data technologies
0NE
Silver Bullet Data Services GmbH Germany Herzogspitalstraße 24, 80331, Munich Marketing services and data technologies
Silver Bullet Data Services Pty Ltd Australia 452 Flinders St, Melbounre, 3000, Victoria Marketing services and data technologies
Silver Bullet Data Services S.r.l Italy 20161, Via Gian Rinaldo, Carli n. 47, Milan Marketing services and data technologies
Technobeet S.r.l. Italy 20161, Via Gian Rinaldo, Carli n. 47, Milan Dormant
Silver Bullet USA Inc. United States of America 1250 Broadway, 36th Floor, New York, New York, 10001 Marketing services and data technologies
Local Planet Data Services Ltd England and Wales Studio 44 The Finsbury Business Centre, 40 Bowling Green Lane, London, EC1R Marketing services and data technologies
0NE
16. Trade and other receivables
Group Company
2021 2020 2021 2020
£ £ £ £
Trade receivables 1,333,272 1,153,570 - -
Other receivables 202,623 179,716 75,965 -
Prepayments 151,749 110,781 2,557 -
Contract assets 217,328 113,677 - -
Corporation tax receivable 360,000 165,536 - -
2,264,972 1,723,280 78,522 -
In determining the recoverability of accounts receivable, the Group considers
any changes in the credit quality of the accounts receivable from the date
credit was initially granted up to the reporting date.
Those receivable balances that are passed due have been assessed by management
on an individual basis and provisions for bad debts has been made as
necessary.
Contract assets represent agreements with customers against which revenue has
been recognised but not yet invoiced in accordance with the contract terms.
All accrued revenue at each period end has been invoiced within a maximum of
three months of the reporting period.
17. Cash and cash equivalents
Group Company
2021 2020 2021 2020
£ £ £ £
Cash at bank 3,687,809 654,792 60 -
3,687,809 654,792 60 -
Cash at bank earns interest at floating rates based on daily bank deposit
rates.
18. Trade and other payables
Group Company
2021 2020 2021 2020
£ £ £ £
Trade payables 525,267 900,809 35,129 -
Tax and social security 558,799 884,844 20,613 -
Other payables 317,013 472,773 50 18,517
Accruals 1,007,845 570,357 10,468 -
Contract liabilities 200,099 443,318 - -
Amounts owed to group undertakings - - 1,983,003 1,700,903
2,609,023 3,272,101 2,049,261 1,719,420
The fair value of trade and other payables approximates to book value at each
year-end. Trade payables are non-interest bearing and are normally settled
monthly.
Contract liabilities represent agreements with customers against which revenue
has not yet been recognised for invoices raised during the report period. All
such deferred revenue at each period end has been released to the Statement of
Comprehensive Income within a maximum of three months of the reporting period.
19. Loans and borrowings
Group Company
2021 2020 2021 2020
£ £ £ £
Current liabilities
Bank loans 16,061 - - -
16,061 - - -
2021 2020 2021 2020
£ £ £ £
Non-current liabilities
Bank loans 143,644 188,570 - -
143,644 188,570 - -
As at 31 December 2021 the Group had debt finance of £177,104 accruing
interest at 1.95% repayable over six years to 2026, with repayments due from
31(st) August 2022.
20. Deferred tax liability
Group Company
2021 2020 2021 2020
£ £ £ £
Movements in the year:
Liability brought forward 223,921 101,341 - -
Charge / (credit) to profit or loss 323,971 122,580 - -
Liability carried forward 547,892 223,921 - -
All deferred tax liabilities are recognised in respect of intangible asset
timing differences. No deferred tax assets have been recognised by the Group.
21. FINANCIAL INSTRUMENTS
Financial instruments and risk management
The Group's financial instruments may be analysed as follows:
Group Company
2021 2020 2021 2020
£ £ £ £
Financial assets measured at amortised cost
Cash and cash equivalents 3,687,809 654,792 60 -
Trade receivables 1,333,272 1,153,570 - -
Other receivables 202,623 293,393 75,965 -
5,223,704 2,101,755 76,025 -
Financial liabilities measured at amortised cost
Trade payables 525,267 900,809 35,129 -
Accruals 1,007,845 570,357 10,468 -
Other payables 875,812 1,014,217 2,014,133 1,719,420
Bank Loans 159,705 188,570 - -
2,568,629 2,673,953 2,059,730 1,719,420
Financial assets measured at amortised cost comprise cash, trade receivables
and other receivables.
Financial liabilities measured at amortised cost comprise bank loans and
overdrafts, other loans, trade payables, other payables and lease liabilities.
The debt instruments were initially recognised at fair value, and subsequently
they were measured at amortised cost using the effective interest rate method,
whereby the fair value of the debt approximates their carrying value.
The Group is exposed to a variety of financial risks through its use of
financial instruments which result from its operating activities. All of the
Group's financial instruments are classified as loans and receivables.
The Group does not actively engage in the trading of financial assets for
speculative purposes. The most significant financial risks to which the Group
is exposed are described below:
Credit risk
Generally, the Group's maximum exposure to credit risk is limited to the
carrying amount of the financial assets recognised at the reporting date, as
summarised above.
Credit default risk is the financial risk to the Group if a counter party to a
financial instrument fails to meet its contractual obligation. The nature of
the Group's receivable balances, the time taken for payment by entities and
the associated credit risk are dependent on the type of engagement.
Credit risk is minimised substantially by ensuring the credit worthiness of
the entities with which it carries on business. Credit terms are provided on a
case-by-case basis. The Group's trade and other receivables are actively
monitored. The Group has not experienced any significant instances of
non-payment from its customers.
Management assess that its exposure to credit risk during the reporting period
has increased as a result of Brexit and the Coronavirus pandemic causing a
high level of volatility at the end of the reporting period. This increase has
had no significant impact on the Group's operating activities.
Unbilled revenue is recognised by the Group only when all conditions for
revenue recognition have been met in line with IFRS 15.
Liquidity risk
Liquidity risk represents the contingency that the Group is unable to gather
the funds required with respect to its financial obligations at the
appropriate time and under reasonable conditions in order to meet their
current obligations. The Group attempts to manage this risk so as to ensure
that it has sufficient liquidity at all times to be able to honour its current
and future financial obligations under normal conditions and in exceptional
circumstances. Financing strategies to ensure the management of this risk
include the issuance of equity or debt securities as deemed necessary.
All of the Group's financial liabilities mature within twelve months of both
reporting periods, with the exception of non-current liabilities disclosed at
note 18. In each of these cases, the financial liabilities matured within five
years of the reporting date.
Foreign currency risk
The Group operates internationally and is exposed to foreign exchange risk
arising from various currency exposures, primarily Australian Dollars, United
States Dollars and Euros. The Group monitors exchange rate movements closely
and ensures adequate funds are maintained in appropriate currencies to meet
known liabilities.
The Group's exposure to foreign currency risk at the end of the respective
reporting periods were as follows:
2021 2020
AUD USD EUR AUD USD EUR
Assets and liabilities* (504,607) (2,018,873) (1,368,563) (360,564) 38,985 (600,283)
*Assets and liabilities include the monetary assets and liabilities of
subsidiaries denominated in foreign currency.
The Group is exposed to foreign currency risk on the relationship between its
functional currencies and other currencies in which the Group's material
assets and liabilities are denominated. The table below summaries the effect
on reserves had the functional currencies of the Group weakened or
strengthened against these other currencies, with all other variables held
constant.
Group Company
2021 2020 2021 2020
£ £ £ £
10% weakening of functional currency (248,739) (64,520) - -
10% strengthening of functional currency 522,352 135,493 - -
The impact of a change of 10% has been selected as this has been considered
reasonable given the current level of exchange rates and the volatility
observed both on a historical basis and market expectations for future
movements.
22. Share capital and premium
During the reporting periods a number of investment rounds have been completed
raising a total of £11,784,005 in equity finance (net of transaction costs).
Movements in issued share capital and share premium accounts during these
periods are summarised below:
Ordinary share capital Ordinary Ordinary A Ordinary B Ordinary C
Issued and fully paid No. No. No. No.
As at 1 Jan 2021 - 1,546,797 35,448 10
Shares issued 3,727,656 - - -
Change of designation 9,695,031 (1,546,797) (35,448) -
Purchase of own shares - - - (10)
Bonus share issue 87,255,279 - - -
Share consolidation (87,255,279) - - -
As at 31 Dec 2021 13,422,687 - - -
Ordinary D Ordinary G Ordinary H Total
continued… No. No. No. No.
As at 1 Jan 2021 464,689 5,379,104 780,093 8,206,141
Shares issued - 1,488,900 - 5,216,556
Change of designation (464,689) (6,868,004) (780,093) -
Purchase of own shares - - - (10)
Bonus share issue - - - 87,255,279
Share consolidation - - - (87,255,279)
As at 31 Dec 2021 - - - 13,422,687
On 1 April 2021 the Company filed a capital
restructure which converted all issued A, B, D, G, and H shares into one class
of Ordinary Share capital with equal voting rights participation in dividends.
On 7 May 2021 a 9:1 bonus issue was approved by shareholders with a
simultaneous consolidation of share capital from a nominal value of £0.001 to
a nominal value of £0.01.
On 7 May 2021 a capital reduction was also completed reducing the share
premium account by £38,425,667 with the balance being credited to the profit
and loss reserve.
On 19 May 2021 all C shares were repurchased by the company at nominal value.
Prior to the Group's capital restructure above, all classes of share in issue
carried equal rights of participation in dividends. Voting rights were
attributed equally to qualifying shareholders, defined as below:
a. each holder of H Ordinary Shares; and
b. each Shareholder holding Voting Shares (other than H Ordinary Shares) equal to
or greater than 1% of all of the Voting Shares in issue.
23. Share Option Reserve
The Group operates a programme for employees of its subsidiaries to acquire
shares in the company under an EMI scheme. All options are settled by the
physical delivery of shares once the options have vested and are exercised.
The number and weighted average exercise price of share options during the
year were as follows:
2021 2020
Weighted average exercise price Share options Weighted average exercise price Share options
£ # £ #
Outstanding at start of period 3.05 250,153 3.35 220,499
Forfeited/expired during period (1.27) (244,767) - -
Granted during period 1.27 1,705,682 0.79 29,654
Exercised during period (0.30) (31,461) - -
Outstanding at end of period 1.56 1,679,607 3.05 250,153
Share options have been valued at grant date based on the Black Scholes
valuation model using an estimated volatility of 40%. Sensitivity analysis on
this assumption shows that an increase in volatility to 60% increases the
option pool valuation by 6.9%, and a decrease to 20% reduces this valuation by
7.1%.
All options expire after seven years and an expected take-up rate of 100% has
been applied. A dividend yield of 0% has been applied to option valuation
models as the Group focuses on capital growth through this period. Risk-free
rates have been applied ranging from 0.26% to 1.28% based on UK 10-year gilt
rates since 2014.
Other key inputs applied to Black Scholes valuation models are as follows:
Tranche date Options outstanding Share price Average exercise price
No. £ £
01 October 2014 1,325 22.21 0.001
12 January 2015 94 22.21 0.001
15 July 2015 281 24.633 0.001
18 July 2016 2,703 24.633 0.001
12 October 2016 10,000 24.633 24.032
26 January 2018 9,099 8.55 12.901
21 May 2020 24,624 3.64 0.810
06 July 2020 4,360 1.96 0.810
09 July 2020 625 1.96 0.810
17 July 2020 1,500 1.96 0.810
24 July 2020 5,000 1.96 0.799
01 October 2020 2,500 1.96 0.810
02 June 2021 850,966 2.57 0.421
25 June 2021 766,530 2.57 2.314
1,679,607
The movement in option valuation during the year ended 31 December 2021
resulted in a staffing cost being recognised by the Group of £1,683,214
(2020: £376,921), with a corresponding increase in the Group's equity.
The valuation of options exercised, lapsed, and forfeited during the year
totalled £1,533,555 (2020: £nil) which has been transferred to Retained
Earnings.
The contractual life for outstanding options runs for a number of periods, the
latest of which being to 25(th) June 2028.
The total number of exercisable options at the period end was 526,230 (2020:
nil), with an average exercise price of £1.73 (2020: £nil).
24. Related party transactions
Key management personnel and directors' remuneration is detailed at note 9.
Local Planet International Limited: is a related party to the group by virtue
of having Directors in common. Ian James, Martyn Rattle and Nigel Sharrocks
are directors of both companies.
Recharges for shared services totalling £107,131 (2020: £12,389) are
included in revenue for the year ended 31 December 2021. Amounts outstanding
at the year end included in trade receivables totals £37,758 (2020: £2,949).
Recharges for direct costs incurred were processed during the year ended 31
December 2021 totalling £56,000 (2020: £548). Amounts outstanding at 31
December 2021 totalled £5,574 (2020: £657).
Fluency Media Limited: is a related party to the group by virtue of having
Directors in common. Ian James is a director of both companies. Consultancy
services were provided during the year ended 31 December 2021 totalling
£90,000 (2020: £110,000). Amounts outstanding at 31 December 2021 totalled
£nil (2020: £12,000). All of these services were provided prior to listing
in June 2021.
Marmalade Consultants Limited: is a related party to the group by virtue of
having Directors in common. Martyn Rattle is a director of both companies
Consultancy services were provided during the year ended 31 December 2021
totalling £56,673 (2020: £11,667). Amounts outstanding at 31 December 2021
totalled £nil (2020: £nil).
Educated Solutions Limited: is a related party to the group by virtue of
having Directors in common. Ian James and Martyn Rattle are directors of both
companies. Revenue was recognised for services provided to the company during
the year ended 31 December 2021 totalling £13,800 (2020: £nil). Amounts
outstanding at 31 December 2021 totalled £16,560 (2020: £nil) and are
included within trade receivables.
Made by Brittan Limited: is a related party to the group by virtue of having
Directors in common, this relationship ceased in April 2021 following the
related Director resignation from Silver Bullet Data Services Group Plc.
Consultancy services were provided during the year ended 31 December 2021
totalling £nil (2020: £75,289). Amounts outstanding at 31 December 2021
totalled £nil (2020: £30,346).
Purple Lime Accountancy Limited: is a related party to the group by virtue of
having Directors closely related to Key Management Personnel of the Group.
This relationship ceased in April 2021 following the related Director
resignation from Silver Bullet Data Services Group Plc. Accountancy and
finance services were provided during the period ended April 2021 totalling
£50,846 (year ended 2020: £104,203). Amounts outstanding at 31 December 2021
totalled £5,582 (2020: £20,271).
Hartham Group Limited: is a related party to the group by virtue of having a
common Director. This relationship ceased in April 2021 following the related
Director resignation from Silver Bullet Data Services Group Plc. Consultancy
services were provided during the year ended 31 December 2021 totalling £nil
(2020: £4,167).
Umberto Torrielli: A director of the Group company relocated to the USA in
order to establish a new presence in this territory in 2020. For this purpose
a loan was issued of £150,000 which is held within other debtors at the end
of the reporting period (2020: £150,000).
Transactions with group companies
As holding company for the subsidiaries listed at Note 15, all funds raised
are distributed to subsidiary companies as required. A summary of balances
outstanding at the period end are provided below. All balances are repayable
on demand and are lent without security or accruing any interest.
A provision for bad debts has been included in the Company financial
statements for all amounts receivable from subsidiaries in both the current
and previous year.
Amounts owed from subsidiary companies 2021 2020
£ £
Silver Bullet Media Services Limited 36,553,023 24,177,392
Iotec Native Limited 802,131 519,982
Silver Bullet Data Services Limited 56,008 56,008
Silver Bullet Data Services GmbH 11,886 11,886
37,423,048 24,765,267
Amounts owed to subsidiary companies 2021 2020
£ £
Silver Bullet Media Services Limited 1,180,872 1,180,921
Iotec Native Limited 802,131 519,982
1,983,003 1,700,903
25. Earnings per share
Earnings per share (EPS) is calculated on the basis of profit attributable to
equity shareholders divided by the weighted average number of shares in issue
for the year. The diluted EPS is calculated on the treasury stock method and
the assumption that the weighted average EMI share options outstanding during
the period are exercised.
2021 2020
£ £
Loss after taxation (8,510,681) (5,118,324)
Number of shares
Weighted average number of ordinary shares in issue 11,684,142 6,855,439
Dilutive effect of in-the-money share options 792,028 213,030
Diluted weighted average number of shares 12,476,170 7,068,469
Earnings per share
Basic earnings per share (0.73) (0.75)
Diluted earnings per share (0.73) (0.75)
As options are not antidilutive, the diluted EPS is the same as the basic EPS
in this situation.
26. Other financial commitments
The Company has provided a guarantee in respect of
the outstanding liabilities of the subsidiary companies listed below in
accordance with Sections 479A - 479C of the Companies Act 2006, as these
subsidiary companies of the Group are exempt from the requirements of the
Companies Act 2006 relating to the audit of the accounts by virtue of Section
479A of this Act.
Silver Bullet Media Services Limited (08235870)
IOTEC Native Limited (08286180)
Silver Bullet Data Services Limited (10081847)
Local Planet Data Services Ltd (13123941)
27. Ultimate controlling party
Management consider there is no ultimate controlling part of the Group as no
individual shareholder owns more than 15% of the issued share capital.
The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulation
(EU) No. 596/2014 as it forms part of United Kingdom domestic law by virtue of
the European Union (Withdrawal) Act 2018, as amended.
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