Location Sciences - Half-year Report
14/09/2023 07:00
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RNS Number : 3752M Location Sciences Group PLC 14 September 2023
14 September 2023
This announcement contains inside information for the purposes of Regulation
11 of the Market Abuse (Amendment) (EU Exit) Regulations 2019/310. With the
publication of this announcement via a Regulatory Information Service, this
inside information is now considered to be in the public domain.
Location Sciences Group PLC
("Location Sciences" or the "Company" or the "Group")
Interim Results for the six months ended 30 June 2023
Location Sciences (AIM: LSAI), the leading location data insight and
verification company, announces its interim results for the six months ended
30 June 2023.
CHAIRMAN'S REPORT FOR THE PERIOD ENDED 30 JUNE 2023
Introduction
The most significant development for Location Sciences during the period was
the announcement in June this year that the Company had entered exclusive
non-binding heads of terms regarding a potential acquisition of the entire
issued share capital of Sorted Holdings Limited ("Sorted") for a nominal
consideration of £1.00 (the "Proposed Acquisition"). The Location Sciences
team is working hard to complete the proposed acquisition and expects this to
occur during the final quarter of the year.
Sorted is a provider of delivery experience software which serves leading
ecommerce retailers - from large, global enterprises to smaller, independent
start-ups. The Sorted delivery platform has three core propositions:
• Ship - carriage management, carriage allocation and
ecommerce checkout optimisation.
• Track - post-purchase parcel tracking and customer
communications; and
• Return - refunds and exchanges management.
Contemporaneus with signing the heads of terms regarding the Proposed
Acquisition, the Company also entered into a secured convertible bridge loan
agreement with Sorted to lend it up to £2.6 million. As at 30 June 2023,
£600,000 of this loan had been drawn down by Sorted.
Trading performance
Unaudited revenues for the six months ended 30 June 2023 were £33,765,
compared to underlying revenues of £46,408 in H1 2022, representing a
decrease of 27%.
Administration expenses were £150,716 in H1 2023 compared to £489,552 in H1
2022. The decrease of 69% in administration expenses is mainly due to the
impact of fee shares to the non-executive directors not being issue in the
period. Cash costs have been reduced during the period, with overhead
reductions being implemented by the Board.
The EBITDA loss for the six months to 30 June 2023 was £126,948, representing
a decrease of 65% on the EBITDA loss in the six months to 30 June 2022 of
£362,809.
Loss before tax for the six months to 30 June 2023 was £232,528, representing
a decrease of 53% on the loss before tax in the six months to 30 June 2022 of
£492,353.
Outlook
The Board is excited with the potential that the acquisition of Sorted should
provide to Location Sciences and will update the Company's shareholders in due
course.
Simon Wilkinson
Chairman
LOCATION SCIENCES GROUP PLC
CONSOLIDATED PROFIT AND LOSS ACCOUNT FOR THE PERIOD ENDED 30 JUNE 2023
Six months Six months Year ended 31 December
ended 30 June ended 30 June 2022
2023 2022 Audited
Unaudited Unaudited £
Note £ £
Revenue 4 33,765 145,430 110,856
Cost of sales (9,997) (18,686) (29,358)
Gross profit 23,768 126,743 81,498
Grant income - - -
Other income - - -
Administrative expenses (150,716) (489,552) (723,149)
Amortisation and depreciation (108,391) (130,524) (259,335)
Exceptional administrative expenses - - 42,040
Operating loss 4 (235,339) (493,333) (858,946)
Finance income 2,801 980 8,368
Finance expense - - -
Loss before tax (232,538) (492,353) (850,578)
Taxation - - -
Loss for the financial year from continuing operations (232,538) (492,353) (850,578)
Discontinued Operations
Loss for the year from discontinued operations - - 92,357
Loss for the financial year (232,528) (492,353) (758,221)
Earnings per share
Loss per share - basic and diluted (0.01p) (0.02p) (0.029p)
The above results were derived from continuing operations.
LOCATION SCIENCES GROUP PLC
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE PERIOD ENDED 30 JUNE
2023
Six months Six months Year ended 31 December
ended 30 June ended 30 June 2022
2023 2022 Audited
Unaudited Unaudited £
£ £
Loss for the year (232,538) (492,353) (758,221)
Foreign currency translation losses - - -
Total comprehensive income for the year attributable to owners of the company (232,538) (492,353) (758,221)
LOCATION SCIENCES GROUP PLC
CONSOLIDATED BALANCE SHEET AS AT 30 JUNE 2023
30 June 30 June 31 December
2023 2022 2022
Note Unaudited Unaudited Audited
£ £ £
Non-current assets
Intangible assets 26,282 406,967 134,674
Property, plant and equipment - - -
26,282 406,967 134,674
Current assets
Trade and other receivables 168,085 259,564 228,072
Bridge loan - Sorted drawdown 600,000 - -
Current tax asset - 113,871 -
Cash and cash equivalents 3,498,243 4,227,685 4,125,571
4,266,328 4,601,120 4,353,643
Current liabilities
Trade and other payables (194,695) (202,088) (157,864)
(194,695) (202,088) (157,864)
Net current assets 4,097,915 4,399,032 4,195,778
Net assets 4,097,915 4,805,999 4,330,453
Capital and reserves
Called up share capital 5 16,340,507 16,340,507 16,340,507
Share premium reserve 20,088,118 20,088,118 20,088,118
Merger relief reserve 11,605,556 11,605,556 11,605,556
Capital reserve 209,791 209,791 209,791
Other reserves (9,225,108) (9,225,108) (9,225,108)
Equity Reserve 1,135,319 1,135,319 1,135,319
Retained earnings (36,056,268) (35,348,184) (35,823,730)
Total equity 4,097,915 4,805,999 4,330,453
LOCATION SCIENCES GROUP PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE PERIOD ENDED 30 JUNE 2023
EQUITY ATTRIBUTABLE TO THE PARENT COMPANY
Merger relief Reverse acquisition Equity reserve Retained earnings
Share capital Share premium reserve Capital reserve reserve £ £ Total
£ £ £ £ £ £
At 1 January 2022 16,298,007 20,034,993 11,605,556 209,791 (9,225,108) 1,135,319 (34,879,987) 5,178,571
Loss for the period - - - - - - (492,353) (492,353)
Other comprehensive income - - - - - - - -
Issue of shares 42,500 53,125 - - - - - 95,625
Share based payments - - - - - - 24,156 24,156
At 30 June 2022 16,340,507 20,088,118 11,605,556 209,791 (9,225,108) 1,135,319 (35,348,184) 4,805,999
At 1 January 2022 16,298,007 20,034,993 11,605,556 209,791 (9,225,108) 1,135,319 (34,879,987) 5,178,571
Loss in year - - - - - - (758,221) (758,221)
Other Comprehensive Income - - - - - - (758,221) (758,221)
Issues of shares 42,500 53,125 - - - - - 95,625
Warrants issued - - - - - - - -
Share based payments - - - - - - (185,522) (185,522)
At 31 December 2022 16,340,507 20,088,118 11,605,556 209,791 (9,225,108) 1,135,319 (35,823,730) 4,330,453
At 1 January 2023 16,340,507 20,088,118 11,605,556 209,791 (9,225,108) 1,135,319 (35,823,730) 4,330,453
Loss for the period - - - - - - (232,538) (232,528)
Other comprehensive income - - - - - - - -
Issue of shares - - - - - - - -
Share based payments - - - - - - - -
At 30 June 2023 16,340,507 20,088,118 11,605,556 209,791 (9,225,108) 1,135,319 (36,056,258) 4,097,915
LOCATION SCIENCES GROUP PLC
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE PERIOD ENDED 30 JUNE 2023
Six months Six months Year ended 31 December
ended 30 June ended 30 June 2022
2023 2022 Audited
Unaudited Unaudited £
Note £ £
Cash flows from operating activities
Loss for the year from continuing activities (232,538) (492,353) (850,758)
Loss for the year from discontinued activities - - 92,537
Adjustments to cash flows from non-cash items:
Depreciation and amortisation 108,391 130,524 259,335
Impairment charge - - 143,482
Foreign exchange (gains) / losses - - -
Finance income (2,801) (980) (8,368)
Finance costs - - -
Share based payment transactions - 24,156 (185,522)
Income tax expense - - -
Up lift in fair value of directors' fees - 10,625 10,625
Shares issued other than for cash - 85,000 85,000
(126,948) (243,028) (453,669)
Working capital adjustments
Decrease in trade debtors 59,987 71,995 103,487
Bridging Loan drawdown (600,000) - -
Increase in trade creditors 36,830 18,913 (25,310)
Cash used in operations (503,183) (152,120) (375,492)
Income taxes received - - 113,871
Net cash used in operating activities (630,131) (152,120) (261,622)
Cash flows from investing activities
Interest received 2,801 980 8,368
Disposals of discontinued operations - - -
Acquisitions of tangible assets - - -
Acquisition of intangible assets - - -
Net cash used in investing activities 2,801 980 8,368
Cash flows from financing activities
Proceeds from issue of ordinary shares, net of issue costs
- - -
Net cash generated from financing activities - - -
Net (decrease)/increase/ in cash and cash equivalents (253,254) (253,254)
(627,328)
Cash and cash equivalents at beginning of period 4,378,825 4,378,825
4,125,571
Cash and cash equivalents at end of period 3,498,243 4,227,685 4,125,571
Six months Six months Year ended 31 December
ended 30 June ended 30 June 2022
2023 2022 Audited
Unaudited Unaudited £
Note £ £
Non-cash financing activities
Share warrants exercised in period - - -
Fees settled by share issues - - -
Directors' fees settled by share issues - 95,625 95,625
LOCATION SCIENCES GROUP PLC
NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 JUNE 2023
1 General information
Location Sciences Group PLC and its subsidiary Location Sciences AI Limited
(together the "Group") provide location verification services, utilising
sophisticated machine learning and pattern recognition technologies Verify
detects location ad-fraud and checks the accuracy and quality of location
signals used to improve the performance of digital advertising.
The Company is a public limited company which is quoted on the AIM market of
the London Stock Exchange and is incorporated and domiciled in the United
Kingdom.
2 Basis of preparation
The financial information has been prepared in accordance with International
Financial Reporting Standards ("IFRS") as adopted by the European Union, IFRIC
interpretations and with those parts of the Companies Act 2006 applicable to
companies reporting under IFRS. The accounting policies adopted are consistent
with those of the financial statements for the year ended 31 December 2022, as
described in those financial statements.
The figures for the six-month periods ended 30 June 2023 and 30 June 2022 have
not been audited. The figures for the year ended 31 December 2022 have been
extracted from, but do not constitute, the consolidated financial statements
of Location Sciences Group PLC for that year. Those financial statements have
been delivered to the Registrar of Companies and included an unqualified
auditors' report and did not contain a statement under Section 498(2) or
Section 498(3) Companies Act 2006.
3 Loss per share
Six months Six months Year ended 31 December
ended 30 June ended 30 June 2022
2023 2022 Audited
Unaudited Unaudited £
£ £
Loss attributable to shareholders (232,538) (492,353) (758,221)
No. No. No.
Weighted average number of shares (basic) 2,647,587,398 2,611,934,620 2,629,956,603
The calculation of basic loss per share of 0.01p (June 2022: 0.02p; December
2022: 0.029p) is based on loss after taxation and the weighted average number
of ordinary shares in issue during the period.
4 Segmental analysis
Operating segments are based on internal reports about components of the
Company, which are regularly reviewed and used by the Board of Directors being
the Chief Operating Decision Maker ("CODM") for strategic decision making and
resource allocation, in order to allocate resources to the segment and to
assess its performance.
During the first half of 2023, the Group has operated through its trading
company Location Sciences AI Limited. The business provides location
verification services, utilising sophisticated machine learning and pattern
recognition technologies Verify detects location ad-fraud and checks the
accuracy and quality of location signals used to improve the performance of
digital advertising.
It should be noted that a segmental analysis of the Consolidated Statement of
Financial Position is not part of routine management reporting and,
consequently, no segmental analysis of assets is shown here.
An analysis of operating revenue is as follows:
Six months Six months Year ended 31 December
ended 30 June ended 30 June 2022
2023 2022 Audited
Unaudited Unaudited** £
£ £
Location data and Insights* - - -
Verify 33,765 145,430 110,856
33,765 145,430 110,856
* disclosed within discontinued operations
** includes £99,022 of earn-out income from the sale of the Insights business
during 2021
An analysis of EBITDA is as follows:
Six months Six months Year ended 31 December
ended 30 June ended 30 June 2022
2023 2022 Audited
Unaudited Unaudited £
£ £
Location data and insights - -
Verify 126,948 362,809 641,651
126,948 362,809 641,651
An analysis of loss before tax is as follows:
Six months Six months Year ended 31 December
ended 30 June ended 30 June 2022
2023 2022 Audited
Unaudited Unaudited £
£ £
Location data and insights - - -
Verify (232,538) (492,353) (850,579)
(232,538) (492,353) (850,579)
5 Share capital
30 June 30 June 31 December
2023 2022 2022
Unaudited Unaudited Audited
£ £ £
2,647,587,398 ordinary shares of 0.1p (June 2022 - 2,647,587 of 0.1p, December
2022 2,647,587,398 of 0.1p) each
2,647,587 2,647,587 2,647,587
1,040,712,398 deferred shares of 0.99p each 10,303,054 10,303,054 10,303,054
376,651,734 New Deferred shares of 0.9p each 3,389,866 3,389,866 3,389,866
16,340,507 16,340,507 16,340,507
Share issue
No shares were issued in the period.
Share rights
Ordinary shares have attached to them full voting, dividend and capital
distribution (including on winding up) rights; they do not confer any rights
of redemption.
Deferred shares have attached to them no voting, dividend or capital
distribution (including on winding up) rights; they do not confer any rights
of redemption.
Warrants in Issue
1) Promoter Warrants - non-transferable warrants to subscribe for up to
1,500,000,000 Ordinary Shares, exercisable at the 0.20p for five years from 25
May 2021, were issued to certain members of the Concert Party in consideration
of those persons assembling and co-ordinating the Concert Party's investment
in the Company in May 2021 and facilitating the appointment of Simon Wilkinson
as Non-Executive Chairman.
Name Number
of Ordinary Shares subject to Promoter Warrants
Richard
Hughes
500,000,000
Mahmud Kamani
500,000,000
Simon Wilkinson
500,000,000
2) Cornerstone Investor Warrants - non-transferable warrants to subscribe for
up to 250,000,000 Ordinary Shares, exercisable at 0.20p for five years from 25
May 2021, were issued to the Cornerstone Investors of the May 2021 placing.
Name Number
of Ordinary Shares subject to Cornerstone Investor Warrants
Ben
Turner
50,000,000
Donna
Turner
75,000,000
James
Pope
50,000,000
Maxine
Pope
75,000,000
3) Broker Warrants - transferable warrants to subscribe for up to 100,000,000
Ordinary Shares, exercisable at the 0.20p for five years from 25 May 2021 were
issued as shown below.
Name Number
of Ordinary Shares subject to Broker Warrants
Turner
Pope
58,750,000
Dr Nigel
Burton
25,000,000
Mark
Slade
10,000,000
David Rae
6,250,000
4) Director Warrants - non-transferable warrants to subscribe for, in
aggregate, 120,000,000 Ordinary Shares were issued to the Executive Directors
and the Non-Executive Directors, exercisable at 0.20p for five years from 25
May 2021, provided that the Ordinary Shares have traded at a Volume Weighted
Average Price (VWAP) at or above 0.30p for 20 consecutive Business Days, or on
a change of control of the Company.
Name Number
of Ordinary Shares subject to Broker Warrants
Mark
Slade
30,000,000
David
Rae
30,000,000
Simon Wilkinson
30,000,000
Dr Nigel
Burton
30,000,000
6. Availability of half-year report
Copies of the half-year report are available on request from the Company's
registered office at First Floor, St James House, St James Square, Cheltenham,
Gloucestershire GL50 3PR and can also be viewed at:
https://www.locationsciencesgroup.ai/investor-relations/reports-presentations/
(https://www.locationsciencesgroup.ai/investor-relations/reports-presentations/)
For further information please contact:
Location Sciences Group
PLC
via Allenby Capital
Simon Wilkinson, Chairman
Allenby Capital Limited (Nominated
Adviser)
Tel: +44 (0)20 3328 5656
David Hart
Vivek Bhardwaj
Turner Pope Investments (TPI) Ltd
(Broker)
Tel: +44 (0)20 3657 0050
James Pope
Andy Thacker
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