REG - T42 IOT Tracking Sol - Interim Results
30/09/2024 09:15
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RNS Number : 2235G T42 IOT Tracking Solutions PLC 30 September 2024
30 September 2024
t42 IoT Tracking Solutions Plc
("t42", the "Company" or, together with its subsidiaries, the "Group")
Interim Results
t42 IoT Tracking Solutions plc (AIM: TRAC) ("t42" or the "Company"), which
provides real-time tracking, security, and monitoring solutions for the global
supply chain, logistics, container, and freight market, announces its
unaudited results for the six months ended 30 June 2024.
Business Overview Highlights
• We are on track to achieve 100% year-over-year growth in Lokies
revenues, reflecting strong demand and market confidence in our products.
• Sales agreements announced since the beginning of the year are
progressing as expected, contributing to our solid commercial performance.
• The maturity date of the Company's two outstanding convertible
loan notes ("CLNs") have been extended for an additional four months to May
2025 on unchanged terms, enhancing financial flexibility.
H1 Financials Highlights
• Revenues increased to $2.0m (H1 2023: $1.7m).
• Adjusted EBITDA loss improved to $25,000 (H1 2023: loss of
$248,000).
• Gross margin for the period was stable at 45% (H1 2023: 48%).
• Operating expenses decreased to $1.2m (H1 2023: $1.3m).
Avi Hartmann, CEO of t42, commented:
"2024 has already marked a significant turning point for t42, with new supply
agreements surpassing those of the entire previous year by mid-year,
demonstrating strong market demand for our Lokies smart locks and other
innovative solutions. The recent extension of both CLN facilities for an
additional four months, under unchanged terms, enhances our financial
flexibility to support ongoing growth. Our focus on improving product
performance, particularly in energy efficiency, continues to resonate with
clients and adds substantial value to their operations. With this momentum, we
are confident in our ability to drive innovation, expand our market presence,
and lead the container tracking industry in the coming years."
Contacts:
t42 IoT Tracking Solutions Plc
Michael Rosenberg, Chairman 07785 727595
Avi Hartmann, CEO +972 5477 35663
Strand Hanson Limited (Nominated Adviser and Financial Adviser) James Harris / 020 7409 3494
Richard Johnson / Robert Collins
Peterhouse Capital Limited (Joint Broker) 020 7469 0930
Lucy Williams / Charles Goodfellow / Eran Zucker
The information contained within this announcement is deemed by the Company to
constitute inside information pursuant to Article 7 of EU Regulation 596/2014
as it forms part of UK domestic law by virtue of the European Union
(Withdrawal) Act 2018 as amended.
CHAIRMAN'S STATEMENT
We are pleased to report T42's unaudited results for the half year ended 30
June 2024 ("H1 2024"). Total revenues reached $2.0 million, up from $1.7
million in H1 2023. We expect to fulfill orders under the agreements announced
earlier this year during the remainder of the second half. The gross margin
for the period remained stable at 45%, compared to 48% last year. We continue
to deliver on these agreements, along with additional long-term and ad-hoc
orders, with a strong focus on the shipping container market.
A few years ago, we made a significant strategic shift within the Company,
transitioning our focus from vehicle tracking systems to container tracking
and monitoring solutions. This transformation not only led to the rebranding
of the Company to t42 but also marked a fundamental change in our core
business. We successfully retained our excellent team, while at the same time,
we developed new products, identified new customers, and built innovative
revenue models.
In a short period, we have demonstrated that we are on the right track, and
the upward trend is clearly reflected in our results. In the container market
segment we experienced significant growth in H1 2024, with new supply
agreements, for orders in 2024 and the following two years, surpassing the
total sales achieved in 2023. This remarkable momentum is a clear reflection
of the exceptional quality of our Lokies smart locks, and the enthusiastic
reception received in the market. Demand continues to grow, positioning us for
even greater success by year-end.
We have invested considerable effort in the development and performance
improvement of our products, and we have successfully reduced the energy
consumption of the locks by a significant amount. This enhancement means
customers need to charge the locks less frequently, providing significant
logistical benefits and added value to our clients.
This positive trend continues to strengthen. More and more customers are being
introduced to our monitoring solutions, additional pilots are underway, and
the existing market potential is converting into tangible business deals.
Moreover, we remain committed to investing in our complementary product,
Tetis, where we have also focused on improving energy efficiency.
A significant part of this growth can be seen in the new supply agreement that
have been signed during H1 2024. We anticipate that actual orders will exceed
the initial estimates set out by the clients in the contracts. With one of our
clients, we are already in advanced discussions to finalise next year's order
forecast, which we hope will significantly exceed the initial contract amounts
and we will provide updates on this in due course.
There is no doubt that t42's investments are shaping the future of container
monitoring technology. The increase in anticipated orders for 2024 is a
significant step towards achieving the Company's potential and its ambition to
lead the market in the coming years, in line with our renewed strategy.
R&D
Over the past six months, t42 IoT Solutions has achieved significant
advancements in its technology and product offerings, reinforcing our
commitment to innovation and excellence in the IoT sector. Our efforts have
been focused on enhancing road safety solutions, improving client experiences,
and expanding our global reach into new markets.
In a first-of-its-kind project in Mexico, we have developed an interface
within our Helios product line to connect to an external display monitor and
provide significant safety improvements to our Mexican client's transportation
fleet. This addition facilitates safer driver identification and introduces
smart alerts in both visual display and human voice regarding speed, adjusted
according to location and direction of travel. The project began as a pilot
with several hundred units and will be progressing during H2 2024 to hardware
orders under the agreement. After a 12-month trial period the client reported
a significant outcome with zero accidents and a 100% success rate in
preventing incidents that would have previously led to significant losses and
insurance claims. Additionally, customers in other countries have already
expressed interest in this solution, and we anticipate that during 2024-2025
it will enable us to reach even more clients.
On our t42 online web application, we have added an interface for creating
thousands of zones based on speed and direction of travel, and for
communicating with end equipment to monitor these zones. This enhancement
allows for more precise and efficient fleet management, providing our clients
with greater control and oversight of their operations.
In our continuous effort to improve customer experience, we have upgraded our
onboarding tools. Clients can now initialize our units more quickly and with
greater accuracy, enabling seamless scaling of installations and shipments.
This enhancement not only streamlines deployment but also reduces operational
downtime for our clients.
Our Lokies product line has been expanded with the introduction of a smaller
shackle, offering greater flexibility and security options without
compromising on durability or reliability. This development provides our
clients with more versatile solutions to meet their specific needs.
FINANCIAL REVIEW
Group revenues for H1 2024 were $2.0m, compared with $1.7m for the six-month
ended 30 June 2023.
Gross margin for the 6 months to 30 June 2024 was stable at 45%, compared with
48% for the corresponding period in 2023.
Total operating expenses for the 6 months to 30 June 2024 were $1.2m (H1 2023:
$1.3m).
For the six months ended 30 June 2024 the Group recorded an exchange rate
income of $0.36 million (H1 2023: $0.03 million), driven by the strengthening
of the US dollar against the Israeli Shekel. However, this was offset by a
significant loss of $0.98 million due to changes in fair value of the CLNs and
warrants associated with the loans.
The Group balance sheet showed an increase in trade receivables to $1.0m
(including long term trade receivables), compared with $0.9m as of 31 December
2023.
Group inventories at the period end were $1.3m compared to $1.4m as of 31
December 2023.
Trade payables at the period end were stable at $0.9m, compared with $1.3m and
$0.8m as of 30 June 2023 and 31 December 2023, respectively.
Net cash from operating activities for the 6 months to 30 June 2024 was $0.3m,
compared with net cash used by operating activities for the 6 months to 30
June 2023 of $0.1m.
CLN Update
Following the reporting period, on 30 September 2024 t42 extended the Group's
two CLNs (total principal of $2.5m) for an additional four months to May 2025,
under unchanged terms and conditions.
OUTLOOK
After years of overcoming challenges in penetrating the container market and
proving the strength of our technology, we made the strategic decision to
rebrand the Company implementing a strategic shift from vehicle tracking
systems to container tracking and monitoring solutions. This move sends a
clear and powerful message to the industry-we are here to establish ourselves
as a dominant force. This year, we have achieved over 100% growth in sales for
the container market compared to the previous year. We are already engaged in
discussions with clients to enhance existing supply contracts. It's now clear
that we are not just participating in this market-we are a key player.
However, we are not content with simply being significant. Our ambition is to
lead the next revolution in this sector. This will require pioneering
technological solutions, a forward-thinking business strategy, and
partnerships with major players who share our vision. We are taking the first
steps on this journey-a long, challenging, and occasionally turbulent path,
but one filled with excitement and potential. The opportunities ahead for T42
are vast and look forward to sharing our progress as we reach each major
milestone.
Michael Rosenberg OBE
Non-Executive Chairman
T42 IOT TRACKING SOLUTIONS PLC
UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2024
T42 IOT TRACKING SOLUTIONS PLC
UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS
JUNE 30, 2024
INDEX
UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS: PAGE
Independent Auditors' report on review of interim financial information 5
Interim Condensed Consolidated Statements of Financial Position 6
Interim Condensed Consolidated Statements of Comprehensive Loss 7
Interim Condensed Consolidated Statements of Changes in Deficit 8
Interim Condensed Consolidated Statements of Cash Flows 9
Notes to the Interim Condensed Consolidated Financial Statements 10-18
Review Report of Independent Auditors
Introduction
We have reviewed the accompanying condensed consolidated interim statements of
financial position of t42 IoT Tracking Solutions PLC and its consolidated
companies (hereinafter - "the Group") as of June 30, 2024 and the related
condensed consolidated interim statements of comprehensive loss, changes in
shareholders' equity and cash flows for the six months then ended. Preparation
and presentation of these condensed consolidated financial statements in
conformity with International Accounting Standard No. 34 "Interim Financial
Reporting" are the responsibility of the Group's board of directors and
management. Our responsibility is to express a conclusion on these interim
consolidated financial statements based on our review.
The Company's annual consolidated financial statements as of December 31, 2023
and the year then ended and the consolidated interim financial statements as
of June 30, 2023 and for six months then ended were audited and reviewed,
respectively, by other accountants that their reports included drawing
attention to the group's financial position and doubts regarding the Company's
ability to continue as a going concern.
Scope of Review
We conducted our review in accordance with Review Standard (Israel) No. 2410
of the Israel Accounting Standards Board, "Review of Interim Financial
Information for Interim Periods Performed by the Auditor of an Entity". A
review consists principally of inquiries of Company personnel, analytical
procedures applied to the financial data and other review procedures. A review
is substantially less in scope than an audit conducted in accordance with
International Standards on Auditing and consequently does not enable us to
obtain assurance that we would become aware of all significant matters that
might be identified in an audit. Accordingly, we do not express an audit
opinion.
Conclusion
Based on our review, we are not aware of any material modifications that
should be made to these interim consolidated financial statements in order for
them to be in conformity with International Accounting Standard No. 34.
Without qualifying our conclusion, we draw attention to Note 1 (b) in the
financial statements regarding the Company's accumulated losses of 17.2
million USD from operations since inception, deficit in working capital of 3.8
million USD and loans in amount of 3.1 million USD to be repaid during the
next 12 months. These factors, among others, indicate that there may be an
uncertainty as the Company's ability to continue as a going concern. The
management is making efforts to raise additional funds required to continue
and develop the group's operation and believes that due to the growth in the
group's activity and other activities taken, the Company will have a
sufficient cash flow to continue in its activity and meets its liabilities.
Shtainmetz Aminoach & Co.
Certified public accountants (Israel)
A member of UHY worldwide
Tel Aviv, September 27, 2024
T42 IOT TRACKING SOLUTIONS PLC
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
U.S. Dollars in thousands
June 30 December 31
Note 2024 2023 2023
Unaudited Unaudited Audited
ASSETS
NON-CURRENT ASSETS :
Property, plant and equipment, net 384 503 422
Rights of use assets, net 1,080 1,004 1,044
Intangible assets, net 3 931 998 952
Long Term Receivables 202 - -
Tax assets - 57 -
Total Non-Current Assets 2,597 2,562 2,418
CURRENT ASSETS :
Cash and cash equivalents 135 215 186
Inventories 1,273 1,499 1,439
Trade receivables, net 792 587 892
Other accounts receivable 108 25 27
Short-term deposit 8 132 35
Total Current Assets 2,316 2,458 2,579
6,124
TOTAL ASSETS 4,913 5,020 4,997
LIABILITIES AND EQUITY
EQUITY (DEFICIT) (2,314) (1,289) (939)
NON-CURRENT LIABILITIES:
Long-term loans from banks, net of current maturities 50 103 88
Amortized cost of a convertible loan 5 - 306 917
Conversion component of a convertible loan at fair value 5 - 14 31
Long term leasehold liabilities 791 778 814
Total Non-Current Liabilities 841 1,201 1,850
CURRENT LIABILITIES:
Short-term bank credit 46 40 42
Short-term loans and current maturities of long-term loans
69 620 167
Warrants at fair value 5 100 52 12
Trade payables 906 1,302 844
Related parties 6 734 772 739
Other accounts payable 701 645 433
Leasehold liabilities 173 119 168
926
Conversion component of convertible loans at fair 5 2,731 - -
value
1,558 1,681
Amortized cost of a loan and a convertible
loan
Total Current Liabilities 6,386 5,108 4,086
TOTAL LIABILITIES AND EQUITY 4,913 5,020 4,997
The accompanying notes are an integral part of the interim
condensed consolidated financial statements.
September 27, 2024
Date of Approval of the Financial Statements Avi Hartmann, CEO
T42 IOT TRACKING SOLUTIONS PLC
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
U.S. Dollars in thousands
Six Months Ended June 30 Year Ended December 31
Note 2024 2023 2023
Unaudited Unaudited Audited
Revenues 2,039 1,707 4,005
Cost of revenues 7 (1,124) (895) (1,882)
Gross profit 915 812 2,123
Operating expenses:
Research and development (54) (52) (92)
Sales and marketing (186) (263) (485)
General and administrative (947) (974) (1,665)
Other income (expenses) , net (8) 16 (3)
(1,195) (1,273) (2,245)
Operating loss (280) (461) (122)
Finance income 368 25 604
Finance expenses (1,467) (318) (902)
Net finance Income (expenses) 8 (1,099) (293) (298)
(1,379) (754) (420)
Total comprehensive loss for the year
Loss per share:
Basic and diluted loss per share (in dollars) 4 (0.025) (0.014) (0.008)
The accompanying notes are an integral part of the interim condensed
consolidated financial statements.
T42 IOT TRACKING SOLUTIONS PLC
INTERIM CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
U.S. Dollars in thousands
Premium on Shares Capital Reserve Capital Reserve for Share-based payment Accumulated Loss
Share Total
Capital *
(Unaudited) - 13,543 89 1,253 (15,824) (939)
Balance- January 1, 2024
Share based payment - - - 4 - 4
Comprehensive loss for the period - - - - (1,379) (1,379)
Balance - June 30, 2024 - 13,543 89 1,257 (17,203) (2,314)
(Unaudited)
Balance- January 1, 2023 - 13,531 89 1,246 (15,404) (538)
Share based payment - 4 - 4
Comprehensive loss for the period - - - - (754) (754)
Balance- June 30, 2022 - 13,531 89 1,250 (16,158) (1,288)
(Audited)
Balance- January 1, 2023 - 13,531 89 1,246 (15,404) )538(
Issuance of share capital (net of expenses) - 12 - - 12
-
Share based payment - - - 7 - 7
Comprehensive loss for the year - - - - (420) (420)
Balance- December 31, 2023 - 13,543 89 1,253 (15,824) (939)
* An amount less than one thousand.
The accompanying notes are an integral part of the interim condensed
consolidated financial statements.
T42 IOT TRACKING SOLUTIONS PLC
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
U.S. Dollars in thousands
Six Months Ended Year Ended December 31
June 30
2024 2023 2023
CASH FLOWS FROM ( OPERATING ACTIVITIES: Unaudited Unaudited Audited
Comprehensive loss (1,379) (754) (420)
Adjustments for:
Depreciation and amortization 243 225 469
Interest expense, changes in fair value of financial instruments and exchange 1,145 55 43
rate differences, net
Share-based payment expense 4 4 7
Capital gain - - (10)
Changes in assets and liabilities:
Decrease (Increase) in inventories 166 82 142
Decrease in trade receivables, net (101) (99) (404)
Decrease (Increase) in other receivables (58) 46 44
Increase in Income Tax Authorities - - 57
Increase (Decrease) in trade payables 38 158 (300)
Increase in other payables 242 385 173
Net cash provided by (used in) operating activities 300 102 (199)
CASH FLOWS FOR INVESTING ACTIVITIES:
Purchases of property and equipment (12) (8) (16)
Proceeds from sales of property, plant and equipment - - 52
Decrease (Increase) in short-term deposits (3) (2) 94
Purchase of intangible assets (73) (72) (134)
Net cash used in investing activities (88) (82) (4)
CASH FLOWS FOR FINANCING ACTIVITIES:
Repayment of short-term bank credit, net 4 )2( (616)
Receipt (Repayment) of short-term loans from banks, net (103) )135( -
Receipt of loans ,net - 250 1,550
Proceeds from (Repayment to) shareholders and related parties, net 26 28 (5)
Repayment of Leasehold liability (87) (86( (183)
Receipt (Repayment) of long-term loans (103) (34) (544)
Proceeds from issue of shares, net - - 12
Net cash provided by (used in) financing activities (263) 21 214
Increase (Decrease) in cash and cash equivalents (51) 41 11
Cash and cash equivalents at the beginning of the period 186 174 174
Cash and cash equivalents at the end of the period 135 215 186
Appendix A - Additional Information
Interest paid during the period 113 189 313
Appendix B - Non-cash financing activities
Issuance of shares to a related party in payment of debt - 103 -
The accompanying notes are an integral part of the interim condensed
consolidated financial statements.
T42 IOT TRACKING SOLUTIONS PLC
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
U.S. Dollars in thousands
NOTE 1 - GENERAL INFORMATION
a. The Reporting Entity
t42 IoT Tracking Solutions PLC ("the Company") was incorporated in Jersey on
November 28, 2012. The Group provides real-time tracking, security, and
monitoring solutions for the global supply chain, logistics, container, and
freight market.
See Note 1 (c) regarding the Company's financial position.
The Company fully owns t42 Ltd., an Israeli company that engages in the same
field, and Starcom Systems Limited, a company in Jersey.
The Company's shares are admitted for trading on the London Stock Exchange's
AIM market.
Address of the official Company office in Israel of t42 Ltd. is:
96 Derech Ramatayim, Hod-Hasharon, Israel.
Address of the Company's registered office in Jersey of Starcom Systems
Limited is:
IFC5, St Helier, Jersey, JE1 1ST
b. Company's financial position:
As of June 30, 2024 the Group has accumulated losses of $17.2 million from
operations since inception and has a deficit in working capital of $3.8
million including loans in amount of $3.1 million to be repaid or converted
during the next 12 months. These factors indicate that there may be an
uncertainty as the Company's ability to continue as a going concern.
The management continues to focus its efforts to raise additional funds
required to continue the Group's operations and negotiating with lenders in
order to find an overall solution for the Group's debt structure in which
loans will be converted to equity. The management believes that due to the
growth in the Group's activity and other efficiency measures taken, the
Company will have a sufficient cashflow to continue in its activities and
meets its liabilities. See also note 10.
T42 IOT TRACKING SOLUTIONS PLC
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
U.S. Dollars in thousands
NOTE 2 - BASIS OF PREPARATION AND CHANGE IN THE GROUP'S ACCOUNTING POLICIES
a. Basis of preparation
The interim consolidated financial statements have been prepared in accordance
with generally accepted accounting principles for the preparation of financial
statements for interim periods, as prescribed in International Accounting
Standard No. 34 ("Interim Financial Reporting").
The interim consolidated financial information should be read in conjunction
with the annual financial statements as of December 31, 2023 and for the year
ended on that date and with the notes thereto.
The significant accounting policies applied in the annual financial statements
of the Company as of December 31, 2023 are applied consistently in these
interim consolidated financial statements.
new standard yet adopted
b.
IFRS 18, Presentation and Disclosure in Financial Statements
This standard replaces IAS 1, Presentation of Financial Statements. The
purpose of the standard is to provide improved structure and content to the
financial statements, particularly the income statement.
The standard includes new disclosure and presentation requirements that were
taken from IAS 1, Presentation of Financial Statements, with small changes.
As part of the new disclosure requirements, companies will be required to
present two subtotals in the income statement: operating profit and profit
before financing and taxes. Furthermore, for most companies, the results in
the income statements will be classified into three categories: operating
profit, profit from investments and profit from financing.
In addition to the changes in the structure of the income statements, the
standard also includes a requirement to provide separate disclosure in the
financial statements regarding the use of management-defined performance
measures (non-GAAP measures).
Furthermore, the standard adds specific guidance for aggregation and
disaggregation of items in the financial statements and in the notes. The
standard will encourage companies to avoid classifying items as 'other' (for
example, other expenses), and using this classification will lead to
additional disclosure requirements. The standard is effective from annual
reporting periods beginning on or after 1 January 2027 with earlier
application being permitted. The Group is examining the effects of the
standard on its financial statements with no plans for early adoption.
Use of estimates and judgments
c.
The preparation of financial statements in conformity with IFRS requires
management of the Company to make judgments, estimates and assumptions that
affect the application of accounting policies and the reported amounts of
assets, liabilities, income and expenses. Actual results may differ from these
estimates.
The judgment of management, when implementing the Group accounting policies
and the basic assumptions utilized in the estimates that are bound up in
uncertainties are consistent with those that were utilized to prepare the
annual financial statements.
Information about critical judgment in applying accounting policies that have
a significant effect on the amounts recognized in the consolidated financial
statements is included in note 5- fair value of financial instruments.
T42 IOT TRACKING SOLUTIONS PLC
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
U.S. Dollars in thousands
d. Exchange rates:
As of June 30 As of December 31
2024 2023 2023
Exchange rate of NIS in U.S. $ 0.266 0.27 0.276
Exchange rate of U.S. $ in GBP 0.79 0.79 0.78
Year Ended December 31
Six Months Ended June 30
2024 2023 2023
Change of NIS in U.S. $ (3.6%) (4.9%) 2.9%
Change of U.S. $ in GBP 1.28% (4.6%) (5.8%)
T42 IOT TRACKING SOLUTIONS PLC
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
U.S. Dollars in thousands
NOTE 3 - INTANGIBLE ASSETES, NET
Cost: Unaudited
Balance as of January 1, 2024 2,018
Additions during the period (*) 72
Balance as of June 30, 2024 2,090
Accumulated Depreciation:
Balance as of January 1, 2024 (1,066)
Amortization during the period (93)
Balance as of June 30, 2024 (1,159)
Impairment of assets -
Net book value as of June 30, 2024 931
Cost: Unaudited
Balance as of January 1, 2023 1,884
Additions during the period (*) 72
Balance as of June 30, 2023 1,956
Accumulated Depreciation:
Balance as of January 1, 2023 (863)
Amortization during the period (95)
Balance as of June 30, 2023 (958)
Impairment of assets -
Net book value as of June 30, 2023 998
Cost: audited
Balance as of January 1, 2023 1,884
Additions during the year (*) 134
Balance as of December 31, 2023 2,018
Accumulated Amortization:
Balance as of January 1, 2023 (863)
Depreciation during the year (203)
Balance as of December 31, 2023 (1,066)
Net book value as of December 31, 2023 952
(*) Capitalization of development costs
T42 IOT TRACKING SOLUTIONS PLC
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
U.S. Dollars in thousands
NOTE 4 - SHARE CAPITAL
a. Composition : As of June 30, 2024: 55,126,357 Ordinary shares of no-par value,
issued and outstanding. As of June 30, 2023 and December 31, 2023: 54,026,822
and 54,917,055 shares , respectively.
b. A Company share grants to its holder voting rights, rights to receive
dividends and rights to net assets upon dissolution.
c. Weighted average number of shares used for calculation of basic and diluted
loss per share:
June 30 December 31
June 30
2024 2023 2023
Unaudited Unaudited Audited
55,106,807 54,026,822 54,064,060
The following table lists the number of share options and warrants with the
exercise prices of share options during the reported period:
Six months ended Year Ended
June 30, 2024 December 31, 2023
Unaudited Audited
Number of options and warrants Weighted average Number of options Weighted average
exercise price exercise price
£ £
Share options & warrants outstanding beginning of period 10,876,650 0.166 12,545,222 0.177
Options & Warrants exercised during the period (209,302) - (530,233) -
Options & Warrants expired during the period (*) (3,083,334) 0.18 (1,138,339) 0.37
Share options & warrants outstanding at end of period 7,584,014 0.156 10,876,650 0.166
Share options & warrants exercisable at end of period (**) 7,584,014 0.156 10,713,651 0.159
(*) Expired and cancelled as part of the CLN extension agreement signed during
the reported period. See notes 11 (b) and 1 (e) in the annual financial
statements.
(**) In addition, the Group also has convertible loans, which can be converted
as of June 30, 2024, to a total amount of 47.1 M shares.
For the six months ended June 30, 2024 and 2023 the Company recognized share
based payment expenses, in the amount of $4,000 and $4,000 respectively.
T42 IOT TRACKING SOLUTIONS PLC
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
U.S. Dollars in thousands
NOTE 5 - FAIR VALUE OF THE FINANCIAL INSTRUMENTS
a. The table hereunder presents a reconciliation from the opening balance
to the closing balance of financial instruments carried at fair value level 3
of the fair value hierarchy:
Conversion components of loans
Warrants
Balance as of January 1, 2024 31 12
Additions during the period - -
Finance (income) expenses 895 88
Payments - -
Balance as of June 30, 2024 926 100
b. As of
June 30, 2024, the estimated fair values of the Warrants and the Convertible
component were measured by an independent appraiser under main assumptions as
follows:
June 30,
2024
Expected term 0.5-3.5 Years
Expected average volatility 22%-64%
Expected dividend yield -
Risk-free interest rate 3.65%-4.91%
Stock market price 0.06 £
Fair value of one unit at the end
of the period £0-0.0266
The level of the fair value hierarchy is level 3.
T42 IOT TRACKING SOLUTIONS PLC
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
U.S. Dollars in thousands
NOTE 6 - CONTROLLING SHAREHOLDERS AND RELATED PARTIES
a. Related parties that own the controlling shares in the Group are:
Mr. Avraham Hartman (10.53%) and Mr. Uri Hartman (5.56%).
b. Short-term balances of controlling shareholders:
June 30 December 31
2024 2023 2023
Unaudited Unaudited Audited
Debit (Credit) balance
(21)
(554)
Avi Hartmann 65 52
Uri Hartmann (550) (570)
Total Credit balance (485) (575) (518)
Loans 49
(246)
Avi Hartmann - 6
Uri Hartmann (249) (227)
Total Loans (249) (197) (221)
Total Short-term balances (734) (772) (739)
c. Transactions: Six Months Ended Year Ended
June 30 December 31
2024 2023 2023
Unaudited Unaudited Audited
Total salaries, services rendered and related expenses for shareholders
195 178 339
Total share-based payment expenses
2 2 2
Non-executive directors' fees 48 38 96
Interest to related parties 5 5 10
NOTE 7 - COST OF REVENUES
Six Months Ended Year Ended December 31
June 30
2024 2023 2023
Unaudited Unaudited Audited
Purchases and other 864 882 1,552
Amortization 94 95 187
Increase (Decrease) in Inventory 166 (82) 143
1,124 895 1,882
T42 IOT TRACKING SOLUTIONS PLC
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
U.S. Dollars in thousands
NOTE 8 - NET FINANCE INCOME (EXPENSES)
Six Months Ended Year Ended December 31
June 30
2024 2023 2023
Unaudited Unaudited Audited
Exchange rate differences 368 25 27
Changes in fair value of Warrants and Conversion component of loans
(980) (117) 577
Bank charges (16) (31) (73)
Loans interest (396) (163) (818)
Interest to suppliers (70) - (1)
Interest to related parties (5) (5) (10)
Interest income from deposits - - -
Net finance expenses (1,099) (291) (298)
NOTE 9 - SEGMENTATION REPORTING
Differentiation policy for the segments:
The Company's management has defined its segmentation policy based on the
financial essence of the different segments. This refers to services versus
goods, delivery method and allocated resources per sector.
On this basis, the following segments were defined: Hardware and SaaS.
Segment information regarding the reported segments:
Hardware SaaS Total
Six months ended 30.06.2024: (Unaudited)
Segment revenues 1,031 1,008 2,039
Cost of revenues (912) (212) (1,124)
Gross profit 119 796 915
six months ended 30.06.2023: (Unaudited)
Segment revenues 728 979 1,707
Cost of revenues (753) (142) (895)
Gross profit (loss) (25) 837 812
Year Ended 31.12.2023: (Audited)
Segment revenues 2,019 1,986 4,005
Cost of revenues (1,611) (271) (1,882)
Gross profit 408 1,715 2,123
T42 IOT TRACKING SOLUTIONS PLC
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
U.S. Dollars in thousands
NOTE 10 - SIGNIFICANT EVENTS AFTER THE REPORTED PERIOD
Further to notes 11 (a), 11 (b) and 1 (e) to the annual financial statements,
the Company, on 30 September 2024, signed addendums to the agreements with the
lenders, to extend the two convertible loans period until May 20, 2025. There
was no change in the other terms of the loans.
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