REG - Tintra PLC - Annual Financial Report for the year to 31 Jan 23
02/10/2023 15:30
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RNS Number : 4162O Tintra PLC 02 October 2023
2 October 2023
Tintra plc
("Tintra", the "Group" or the "Company")
Audited Accounts for the Year to 31 January 2023
The board of directors (the "Board") of Tintra, the rapidly innovating Deep
Tech & Banking business, announces the publication of its audited annual
report and accounts for the year to 31 January 2023 (the "Annual Report").
The Annual Report will be published on the Company's website in compliance
with its articles of association and the electronic communications provisions
of the Companies Act 2006. A copy of the Annual Report can also be accessed
through the link below.
http://www.rns-pdf.londonstockexchange.com/rns/4162O_1-2023-10-2.pdf
(http://www.rns-pdf.londonstockexchange.com/rns/4162O_1-2023-10-2.pdf)
Key extracts from the Annual Report can also be viewed below, including from
the Independent Auditor's Report as well as a summary of the primary variances
from the unaudited results or the same period that were announced on 31 July
2023.
Extract from the Independent Auditor's Report - Basis for qualified opinion
& Emphasis of Matter
"Basis for qualified opinion
During the year, the group divested of its holding in subsidiaries, St. Daniel
House Ltd ("SDH") and Prize Provision Services Limited ("PPSL"). Following
these transactions, management were unable to determine whether any adjustment
to these amounts were necessary by alternative means that the classification
of results for the period and the resulting gain or loss on disposal is
correctly attributed to support the recognition and classification of items
included in the Group's loss for the year of £1,589,000.
Consequently, we were unable to determine whether any adjustment to these
amounts were necessary.
We conducted our audit in accordance with International Standards on Auditing
(UK) (ISAs (UK)) and applicable law. Our responsibilities under those
standards are further described in the Auditor's Responsibilities section of
our report. We are independent of the Group in accordance with the ethical
requirements that are relevant to our audit of the financial statements in the
UK, including the FRC's Ethical Standard as applied to listed entities, and we
have fulfilled our ethical responsibilities in accordance with those
requirements. We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our qualified opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors'
use of the going concern basis of accounting in the preparation of the
financial statements is appropriate. Our evaluation of the directors'
assessment of the group's and parent company's ability to continue to adopt
the going concern basis of accounting included reviewing forecasts, holding
discussions with management and reviewing the current position of the group,
for reasonableness.
Based on the work we have performed, we have not identified any material
uncertainties relating to events or conditions other than noted below that,
individually or collectively, may cast significant doubt on the group's and
parent company's ability to continue as a going concern for a period of at
least twelve months from when the financial statements are authorised for
issue. Our responsibilities and the responsibilities of the directors with
respect to going concern are described in the relevant sections of this
report.
Emphasis of matter
We draw attention to Page 27 to the financial statements which describes a
post balance sheet event relating to the issue of two statutory demands
totalling £2,936,433 against the Company. A settlement agreed with FLF had
been reached whereby the Company agreed to repay £3,030,000 to fully settle
its liability. As of the date of issue of this statutory report, full
repayment has not yet been made to FLF by the Company. Our opinion is not
modified in respect of this matter."
The full Independent Auditor's Report can be viewed in the weblink to the
Annual Report above.
Summary of Primary Variances from Previously Announced Unaudited Results for
the Period
The loss for the year from continuing operations was confirmed at £2.905m
(compared to £2.224m in the unaudited statements), with the total
comprehensive loss for the year at £1.589m (compared to (0.908m), due to
increased audit costs and a loss of £360k on the fair value of financial
assets (compared to a gain of £281k).
Current assets are recorded at £10.537m (compared to £10.498m), with a
reclassification of £1.221m of cash and cash equivalents (£8.776m v
£9.997m) to receivables (£1.761m v £0.501m). Investments in debt
instruments has reduced to £1.557m (compared to £2.198m) due to a fair value
reduction, as set out above. £39k was reclassified from an intangible fixed
asset to a prepayment.
Net cash used in operations has increased to £4.202m (compared to £2.795m),
due to the reclassification of £1.221m of cash and cash equivalents to
receivables, as set out above.
For further information, contact:
Tintra PLC 020 3795 0421
(Investor Relations)
ir@tintra.com
Website www.tintra.com
Allenby Capital Limited 020 3328 5656
(Nomad, Financial Adviser & Broker)
John Depasquale / Nick Harriss / Vivek Bhardwaj
Financial Summary & Highlights
Financial Key Performance Indicators
For the year to 31 January 2023 the Group's performance was as follows:
Key Performance Indicators 2023 2022
£'000 £'000
Revenue - 351
Gross loss - (118)
Loss from continuing operations (2,905) (954)
Normalised EBITDA loss (1,650) (395)
Normalised EBITDA loss 2023 2022
consists of: £'000 £'000
Operating loss (2,972) (895)
Less Depreciation 5 2
Less Amortisation - 5
Exceptional items 1,317 493
Total (1,650) (395)
During the second full year of rationalisation of old businesses into a
Research & Development business, the Company had not expected to make a
profit during this transitionary period, as it focuses on delivering on its
mission to drive financial inclusion through the Global South and to be the
first global Web 3.0 clearing bank based around artificial intelligence
innovations. It does not expect to do so for the remainder of 2023.
Financial & Operational Points of Note
In addition to its rationalisation work in the prior year, in the year ending
31 January 2023 the Company:
Brought in four key, strategic investors from North America, the Gulf and
Southeast Asia, setting in place its foundation for critical research and
discovery work, and the start of the implementation plan that aims for initial
beta go-live by calendar year 2024.
Exited its prior arrangement with Tintra Acquisitions Limited ("TAL"), a
company that is outside of the Group, and which had invested £750,000 in the
Group to 31 January 2022, rationalising TAL's shareholder base and maintaining
any control positions at less than 29.9%
Divested the legacy business units, St Daniel House Limited and Prize
Provision Services Limited
Raised seed capital and funding of £11.65million in addition to that raised
to 31 January 2022, to further support Tintra during its initial Research
& Development phase, including:
o Agreed a Share Placement Deed with a potential strategic investor that was
then exited as a post balance sheet event in response to broader shareholder
feedback.
Announced key appointments of (i) two PhD level officers to its senior
leadership team, focussing on Science and Innovation, to execute its plan to
build global banking infrastructure driven by Artificial Intelligence and
Natural Language Processing tools and (ii) two PhD specialists in geo-politics
and geo-economics to its Non-Executive Board, both bringing key advisory
skills (( 1 (#_ftn1) ))
Filed more than a dozen new patent applications globally based around 4 unique
inventions. that the Company has created as part of its rapid research and
development program
Established footprints in key locations of Qatar, Mauritius and Singapore to
supplement its ongoing work on regulatory licence applications in both the UK
and Puerto Rico jurisdictions:
o Mauritius: granted permission by the Mauritius Financial Services
Commission to commence business under its Payment Intermediary Services
License regime.
o Qatar: Tintra Middle East LLC, a wholly owned subsidiary of the Company
was granted a license by the Qatar Financial Commission to provide
Professional Services - Fintech Services, to develop APIs and to develop a
platform for facilitating real-time transactional capability of mobile devices
and e-commerce.
o Singapore: incorporated a new subsidiary, Tintra Consult (Singapore) PTE
as part of its growth strategy and to enable it to hire a small team to begin
the process of understanding the regulatory landscape prior to the Company
making a bank licence application there in due course.(( 2 (#_ftn2) ))
Continued to develop its planned regulatory licence applications in the UK
(Authorised E-Money Licence, ahead of a banking licence application in future
and an International Financial Entities license in Puerto Rico
Established the Tintra Foundation, whose mission is to promote awareness of
the value of Indigenous knowledge and support its preservation. Through
sharing and valuing indigenous knowledge, storytelling and supporting
indigenous groups to preserve their culture, knowledge and language, we aim
for conservation of indigenous culture, following their own methods, to become
a mainstream approach.
As a post balance sheet event on 7 September 2023, the Company announced that,
following a period of lengthy and extensive negotiations, it had reached an in
principle agreement on the terms of a possible cash offer by LRB 35 Limited
("LRB"), an unquoted special purpose vehicle formed for this purpose,
currently controlled by its directors, Tariq Al Abdulla and Andrew Bascombe,
but with backing from other existing non-management shareholders of Tintra, to
acquire the entire issued, and to be issued, share capital of the Company. In
accordance with Rule 2.6(a) of the Code, LRB is required, by not later than
5.00 p.m. on 5 October 2023, either to announce a firm intention to make an
offer for the Company in accordance with Rule 2.7 of the Code or to announce
that it does not intend to make an offer for the Company, in which case the
announcement will be treated as a statement to which Rule 2.8 of the Code
applies. This deadline can be extended with the consent of the Panel on
Takeovers and Mergers in accordance with Rule 2.6(c) of the Code.
As a consequence of this announcement, an "offer period" then commenced in
respect of Tintra in accordance with the Code and the attention of Tintra
shareholders was drawn to the disclosure requirements of Rule 8 of the Code,
which are summarised below.
Shareholders should note there is no certainty any formal offer will be made,
even if the pre-conditions referred to above are satisfied or
waived. Accordingly, shareholders are advised to take no action at this time.
Further updates shall become available on the Company's website here
(https://tintra.com/investor-relations/regulatory-news/) .
Strategic Report
Chairman's Statement
During the year to 31 January 2023, the Company continued its focus on the
transformative change management process, focusing the business on the one
core aim of building a deep tech-based banking business of the future. The
ground that the Company has covered in past 23 months since becoming Tintra
plc is quite astounding, with it now being a key player in the development of
banking system infrastructure.
As expected, the Company has not traded save to an extent in the discontinued
operation Prize Provisions Services Limited, and as such has no material
revenues during this research & development phase. The year has been
driven by putting in place the essential building blocks for that technology
and banking infrastructure, including key talent hiring at all levels,
securing our first regulatory licences, contracting for our major banking
infrastructure system and significant work that has taken place to build the
functional requirements for that.
The Company is building infrastructure that has the potential to change the
way the world banks. It won't happen overnight but the pace at which these
innovations are happening is meaningful.
Current Trading, Outlook and Transformation
The board of directors are delighted with the significant progress that has
been made in the Group's transformation during the period. The legacy issues
of the past are behind us. As I stated last year, the importance of making
sure the new Tintra was built on a very clean foundation remains paramount. It
is important to remember that at the same time as rapid transformation in our
new mission, we have had immense amounts of work to resolve old legacy
matters.
We continued to build resilience in our talent pool through additions to the
Group's Board and advisory team, highly skilled PhD senior management team
leads and key roles throughout the business as building blocks for the new
bank systems and infrastructure.
The Board are delighted with the securing of operating licences in two key
jurisdictions and remain positive about ongoing work to secure operating
licences in at least 3 other regions and countries.
As expected, the strategic financing and commercial agreement with Tintra
Acquisitions Limited announced in March 2021 led to other substantial
investments in Tintra and its exciting transformation program. In the year,
the Company brought in four new strategic investors from North America, the
Gulf and Southeast Asia, which set in place its foundation for critical
research and discovery work.
The Company raised net seed capital and funding in the year of £11.65 million
(( 3 (#_ftn3) )) in addition to that from Tintra Acquisitions Limited, to
further support Tintra during its initial Research & Development phase.
That capital included US$3.0 million from Fintech Leaders Fund, with which the
Company later reached an agreement for full & final settlement as
described in the Chief Financial Officer's report as a Post Balance Sheet
Event, full repayment of which as at the date of issue of this report has not
yet been made.
Discussions with the four strategic key investors continue regarding the next
phase of the Company's development ahead of the platform infrastructure going
live in 4th quarter of 2024.
The Company's strategic business plan and clear vision for executing on it
remains in place.
Consolidated Statement of Profit and Loss and Other Comprehensive Income
for year ended 31 January 2023
2023 2022
Notes £000 £000
Continuing operations
Revenue 3,4 - 351
Cost of sales 3,5 - (469)
Gross loss - (118)
Administrative expenses
Other administrative expenses 3,5 (2,612) (1,098)
Loss on disposal of fixed assets 12 - (15)
Impairment of goodwill 15 - (334)
Total administrative expenses (2,612) (1,447)
Fair value gain/(Loss) on financial assets 16 (360) 670
Operating loss (2,972) (895)
Finance expenses 7 (46) (59)
Other income 113 -
Loss before tax (2,905) (954)
Income tax expense 10 - -
Loss for the year from continuing operations (2,905) (954)
Discontinuing operations
Gain from discontinued operations, net of tax 9 1,316 500
Loss for the year (1,589) (454)
Other comprehensive loss:
Other comprehensive profit for the year, net of income tax - -
Total comprehensive loss for the year (1,589) (454)
Attributable to:
Owners of Tintra PLC (1,589) (454)
Non-controlling interest - -
(1,589) (454)
2023 2022
Notes £ £
Loss per share
Basic loss per ordinary share (pence per share) 11 (0.11) (0.05)
Diluted loss per ordinary share (pence per share) 11 (0.11) (0.05)
Loss per share from continuing operations
Basic loss per ordinary share (pence per share) 11 (0.19) (0.11)
Diluted loss per ordinary share (pence per share) 11 (0.19) (0.11)
Earnings per share from discontinued operations
Basic earnings per ordinary share (pence per share) 11 0.09 0.06
Diluted earnings per ordinary share (pence per share) 11 0.09 0.06
Consolidated Statement of Financial Position
At 31 January 2023
2023 2022
Notes £000 £000
Non-current assets
Property, plant and equipment 12 42 40
Goodwill 15 - -
Other intangible assets 13 - -
Non-current other receivables 18 - 35
Investments in debt instruments 16 1,557 1,917
Total non-current assets 1,599 1,992
Current assets
Trade and other receivables 18 1,761 151
Cash and cash equivalents 19 8,776 512
10,537 663
Disposal group classified as held for sale 14 - 367
Total current assets 10,537 1,030
Total assets 12,136 3,022
Current liabilities
Trade and other payables 20 (11,235) (2,126)
Bank and other borrowings 21 (7) (7)
(11,242) (2,133)
Disposal group classified as held for sale 14 - (279)
Total current liabilities (11,242) (2,412)
Non-current liabilities
Bank and other borrowings 21 (428) (434)
Total liabilities (11,670) (2,846)
Net assets 466 176
Equity attributable to owners of the parent
Share capital 23 3,239 3,230
Share premium 23 7,122 5,252
Other reserves 25 141 141
Retained deficit (10,036) (8,447)
Total equity attributable to owners of the parent 466 176
Consolidated Cash Flow Statement
for year ended 31 January 2023
2023 2022
Notes £000 £000
Cash flows used in operating activities
Profit/(loss) before tax
Continuing operations (2,905) (954)
Discontinued operations 9 1,316 500
(1,589) (454)
Adjustments for:
Depreciation 12 5 2
Amortisation 13 - 5
Financial expenses 7 51 (28)
Fair value adjustments 16 360 (670)
Loss on disposal of fixed assets - 30
Gain on disposals of subsidiaries (1,159) 848
Movement in working capital:
Increase in trade and other receivables (1,595) (361)
Decrease/(increase) in non-current receivables 35 (35)
Decrease in trade and other payables (299) (1,880)
Cash used in operations (4,191) (2,543)
Interest paid 7 (11) -
Net cash used in operating activities (4,202) (2,543)
Cash flows from/(used in) investing activities:
Acquisition of plant and equipment 12 (7) (40)
Proceed from disposal of subsidiaries 50 -
Net cash disposed of in subsidiaries (5) -
Net cash from/(used in) investing activities 38 (40)
Cash flows from financing activities:
Issue of share capital 23 1,879 2,035
Cash from financial liabilities issued 20 10,592 -
Cash from loan notes (31) 134
Repayment of bank loans 21 (12) (6)
Net cash from financing activities 12,428 2,163
Net increase/(decrease) in cash and cash equivalents 8,264 (420)
Cash and cash equivalents at start of period 512 932
Cash and cash equivalents at end of period 19 8,776 512
(( 1 (#_ftnref1) )) Dr Vanessa Neumann, has taken on special advisory
responsibilities for the Group; Dr. Andrew Bowen resigned from the Board in
August 2023
(( 2 (#_ftnref2) )) In March 2023, the Company also announced that is it
setting up a strategic banking hub in Rwanda, following discussions with
government departments, including with the Rwandan Central Bank and Rwanda
Development Board
3 (#_ftnref3) As a PBSE, a further investment from a Gulf based investor was
announced which at the time of the publication of these statutory accounts was
in the process of completing.
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