REG - Webis Holdings PLC - Annual Report, Notice of Annual General Meeting <Origin Href="QuoteRef">WEBH.L</Origin> - Part 2
30/11/2015 07:10
- Part 2: For the preceding part double click ID:nRSd2564Ha
- (9) -
Balance at 31 May 2015 177 1,246 50 1,423 50
Amortisation and Impairment
At 31 May 2014 - 4,198 50 4,198 50
Amortisation for the year - 93 - 93 -
Impairment of goodwill 177 - - 177 -
Discontinued operation - (3,215) - (3,215) -
At 31 May 2015 177 1,076 50 1,253 50
Net book value
At 31 May 2015 - 170 - 170 -
At 31 May 2014 186 303 - 489 -
At 31 May 2014
186
303
-
489
-
The goodwill balance brought forward relates to the historical acquisition of
subsidiary businesses. Following the cessation of the Group's Sportsbook and
Casino operations, the goodwill balance was fully impaired during the current
period.
The Group tests intangible assets annually for impairment or more frequently
if there are indications that the intangible assets may be impaired (see note
1).
10 Property, equipment and motor vehicles
Cost
At 31 May 2014 2,100 482 40 2,622
Additions during the year 13 9 35 57
Disposals - - (28) (28)
Discontinued operation (1,540) (37) - (1,577)
At 31 May 2015 573 454 47 1,074
Depreciation
At 31 May 2014 1,968 448 23 2,439
Charge for the year 13 12 12 37
Disposals - - (24) (24)
Discontinued operation (1,459) (37) - (1,496)
At 31 May 2015 522 423 11 956
Net book value
At 31 May 2015 51 31 36 118
At 31 May 2014 132 34 17 183
At 31 May 2014
132
34
17
183
Cost
At 31 May 2014 401 141 542
Additions - - -
Disposals - - -
At 31 May 2015 401 141 542
Depreciation
At 31 May 2014 401 124 525
Charge for the year - 6 6
At 31 May 2015 401 130 531
Net book value
At 31 May 2015 - 11 11
At 31 May 2014 - 17 17
At 31 May 2014
-
17
17
11 Investments
Investments in subsidiaries are held at cost. Details of investments at 31
May 2015 are as follows:
WatchandWager.com Limited Isle of Man Operation of interactive wagering totaliser hub 100
Technical Facilities & Services Limited Isle of Man Dormant 100
betinternet.com (IOM) Limited Isle of Man Sportsbook trading company 100
betinternet.com NV Netherlands Antilles Licence holder for games and casinos 100
WatchandWager.com LLC United States of America Operation of interactive wagering totaliser hub and harness racetrack 100
B.E. Global Services Limited Isle of Man Provision of IT & marketing services to the Sportsbook trading company 100
Provision of IT & marketing services to the Sportsbook trading company
100
12 Bonds and deposits
Bonds and deposits which expire within one year 2,441 1,298 - -
Bonds and deposits which expire within one to two years - - - -
Bonds and deposits which expire within two to five years 204 704 - -
2,645 2,002 - -
704
-
-
2,645
2,002
-
-
A rent deposit of $200,000 was paid to California Exposition & State Fair in
2012 and is for a term of 5 years (2014: $200,000). $500,000 has been paid
as a bond in relation to WatchandWager's Californian ADW licence (2014:
$500,000). Rent and security deposits of $7,685 have been paid in relation to
security deposits (2014: $3,678). A sales tax deposit of $5,850 was paid to
the State Board of Equalization and was refunded in June 2014 (2014: $5,850).
An annually renewable insurance bond of $2,000 is also in place.
Under the terms of the licencing agreement with the Hong Kong Jockey Club the
Company is required to hold a retention account of $1,935,685 / HK$15,000,000
(2014: $1,289,792 / HK$10,000,000).
13 Cash and cash equivalents
Cash and cash equivalents - company and other funds 4,691 3,657 1,426 910
Cash and cash equivalents - protected player funds 1,412 4,745 1,412 4,745
Total cash and cash equivalents 6,103 8,402 2,838 5,655
4,745
1,412
4,745
Total cash and cash equivalents
6,103
8,402
2,838
5,655
The Group holds funds for operational requirements and for its non-Isle of Man
customers, shown as 'company and other funds' and on behalf of its Isle of Man
regulated customers, shown as 'protected player funds'.
Protected player funds are held in fully protected client accounts within an
Isle of Man regulated bank.
14 Trade and other receivables
Trade receivables 1,111 590 - -
Other receivables and prepayments 1,468 1,735 41 97
2,579 2,325 41 97
1,735
41
97
2,579
2,325
41
97
15 Trade and other payables
Trade payables 7,678 7,591 21 43
Amounts due to Group undertakings - - 1,509 2,857
Open sports bets 1 9 - -
Taxes and national insurance 72 42 - -
Accruals and other payables 690 573 148 96
8,441 8,215 1,678 2,996
573
148
96
8,441
8,215
1,678
2,996
Amounts due to Group undertakings are unsecured, interest free and repayable
on demand. Included within trade payables are amounts due to customers of
$7,591,139 (2014: $7,323,692).
16 Bank loans
Due within one year - 17 - -
Due within one to two years - - - -
Due within two to five years - - - -
- 17 - -
-
-
-
-
17
-
-
The bank loan was provided by Conister Bank Limited (note 21), carried an
interest rate of 6.5% per annum on the original principal amount and was fully
repaid during the year.
17 Share capital
Allotted, issued and fully paid
At beginning and close of year: ordinary shares of 1p each 393,338,310 6,334 6,334
At 31 May: ordinary shares of 1p each 393,338,310 6,334 6,334
At 31 May: ordinary shares of 1p each
393,338,310
6,334
6,334
The authorised share capital of the Company is US$9,619,000 divided into
600,000,000 ordinary shares of £0.01 each.
Options
Movements in share options during the year ended 31 May 2015 were as follows:
No.
At 31 May 2014 - 1p ordinary shares 14,000,000
Options granted -
Options lapsed (14,000,000)
Options exercised -
At 31 May 2015 - 1p ordinary shares -
Credit in profit and loss account:
Share options - 31
- 31
-
31
18 Open sports bets liabilities
By the nature of the business, a stake can be received from a customer in
respect of some event happening in the future, and hence the level of any
actual liability to the Group cannot be assessed until after that event has
occurred, although the maximum potential liability can be determined. As at
the financial position date, there were $1,157 (2014: $8,714) of such stakes
that had been received where the event to which they related was after the
financial position date. Accordingly, such amount has been reflected as open
sports bets in the balance sheet (see note 15).
The maximum possible liability on open sports bets is $0.007m (2014:
$3.992m).
19 Capital commitments
As at 31 May 2015, the Group had no capital commitments (2014: $Nil).
20 Operating lease commitments
At 31 May 2015, the Group was committed to future minimum lease payments of:
Payments due within one year 119 226
Payments due between two to five years 102 357
Payments due beyond five years - -
Payments due beyond five years
-
-
21 Related party transactions
Identity of related parties
The Group has a related party relationship with its subsidiaries (see note
11), and with its directors and executive officers and with Burnbrae Ltd
(significant shareholder) and with Conister Bank Ltd (common director and
shareholder).
Transactions with and between subsidiaries
Transactions with and between the subsidiaries in the Group, which have been
eliminated on consolidation, are considered to be related party transactions.
Transactions with entities with significant influence over the Group
Rental and service charges of $56,293 (2014: $58,861) and directors' fees of
$31,890 (2014: $32,192) were charged in the year by Burnbrae Limited, of which
Denham Eke is a common director. A loan from Conister Bank Ltd was repaid
during the year (note 16) (2014: $16,952 owed).
Transactions with other related parties
Cash deposits totalling $Nil (2014: $5,697,311) were held with Conister Bank
Ltd at the year end.
22 Financial risk management
Capital structure
The Group's capital structure is as follows:
Cash and cash equivalents 6,103 8,402
Loans and similar income - (17)
Net funds 6,103 8,385
Shareholders' equity (3,174) (5,169)
Capital employed 2,929 3,216
Capital employed
2,929
3,216
The Group's principal financial instruments comprise cash and cash
equivalents, trade receivables and payables that arise directly from its
operations.
The main purpose of these financial instruments is to finance the Group's
operations. The existence of the financial instruments exposes the Group to a
number of financial risks, which are described in more detail below.
The principal risks which the Group is exposed to relate to liquidity risks,
credit risks, interest rate risks and foreign exchange risks.
Liquidity risks
Liquidity risk is the risk that the Group will be unable to meet its financial
obligations as they fall due.
The Group's objective is to maintain continuity of funding through trading and
share issues but to also retain flexibility through the use of short-term
loans if required.
Management controls and monitors the Group's cash flow on a regular basis,
including forecasting future cash flow. Banking facilities are kept under
review to ensure they meet the Group's requirements. Funds equivalent to
customer balances are held in designated bank accounts to ensure that Isle of
Man Gambling Supervision Commission player protection principles are met. The
directors anticipate that the business will continue to generate sufficient
cash flow in the forthcoming period to meet its financial obligations.
The following are the contractual maturities of financial liabilities:
2015
Financial liabilities
Trade creditors 7,678 (7,678) (7,678) - -
Income tax and national insurance 72 (72) (72) - -
Other creditors 295 (295) (295) - -
8,045 (8,045) (8,045) - -
8,045
(8,045)
(8,045)
-
-
2014
Financial liabilities
Carrying amount US$000 Contractual cash flowUS$000 6 months or less US$000 Up to 1 year US$000 1-5 years US$000
Trade creditors 7,591 (7,591) (7,591) - -
Income tax and national insurance 42 (42) (42) - -
Other creditors 153 (153) (153) - -
7,786 (7,786) (7,786) - -
Credit risk
Credit risk is the risk that one party to a financial instrument will cause a
financial loss for the other party by failing to discharge an obligation.
Classes of financial assets - carrying amounts
Cash and cash equivalents 6,103 8,402
Bonds and deposits 2,645 2,002
Trade and other receivables 2,443 2,021
11,191 12,425
11,191
12,425
Generally, the maximum credit risk exposure of financial assets is the
carrying amount of the financial assets as shown on the face of the balance
sheet (or in the notes to the financial statements). Credit risk, therefore,
is only disclosed in circumstances where the maximum potential loss differs
significantly from the financial asset's carrying amount.
The maximum exposure to credit risks for trade receivables in any business
segment:
Pari-mutuel 2,304 1,841
Sportsbook - 180
2,304 2,021
2,304
2,021
Of the above receivables, $1,111,000 (2014: $589,000) relates to amounts owed
from US racing tracks. These receivables are actively monitored to avoid
significant concentration of credit risk and the directors consider there to
be no significant concentration of credit risk.
The directors consider that all the above financial assets that are not
impaired for each of the reporting dates under review are of good credit
quality. No amounts were considered past due at the year end (2014: $Nil).
The credit risk for liquid funds and other short-term financial assets is
considered negligible, since the counterparties are reputable banks with
high-quality external credit ratings.
Interest rate risk
The Group finances its operations mainly through capital with limited levels
of borrowings. Cash at bank and in hand earns negligible interest at floating
rates, based principally on short-term interbank rates.
Any movement in interest rates would not be considered to have any significant
impact on net assets at the balance sheet date.
Foreign currency risks
The Group operates internationally and is subject to transactional foreign
currency exposures, primarily with respect to Pound Sterling, Swedish Krona,
Hong Kong Dollar and Singapore Dollar.
The Group does not actively manage the exposures but regularly monitors the
Group's currency position and exchange rate movements and makes decisions as
appropriate.
At the balance sheet date the Group had the following exposure:
2015 HKD US$ 000 GBP US$ 000 EUR US$ 000 USD US$ 000 SGD US$ 000 NOK US$ 000 DKK US$000 AUD US$000 CAD US$000 CHF US$000 SEK US$000 TotalUS$000
Current assets 3,080 1,149 255 6,315 1 - - - - - 524 11,324
Current liabilities (5,320) (584) (56) (2,482) - - - - - - - (8,442)
Short-term exposure (2,240) 565 199 3,833 1 - - - - - 524 2,882
2014 HKD US$000 GBP US$ 000 EUR US$ 000 USD US$ 000 SGD US$ 000 NOK US$ 000 DKK US$ 000 AUD US$ 000 CAD US$ 000 CHF US$ 000 SEK US$ 000 TotalUS$ 000
Current assets 49 3,244 195 6,168 167 4 7 4 5 2 2,180 12,025
Current liabilities (24) (748) (298) (5,188) (90) (3) (1) (4) - - (1,876) (8,232)
Short-term exposure 25 2,496 (103) 980 77 1 6 - 5 2 304 3,793
The following table illustrates the sensitivity of the net result for the year
and equity in regards to the Group's financial assets and financial
liabilities and the US Dollar-Sterling exchange rate, US Dollar-Swedish Krona
exchange rate and US Dollar-Hong Kong Dollar exchange rate.
A 5% weakening of the US Dollar against the following currencies at 31 May
2015 would have increased equity and profit and loss by the amounts shown
below:
Current assets 57 26 154 237
Current liabilities (29) - (266) (295)
Net assets 28 26 (112) (58)
Net assets
28
26
(112)
(58)
Current assets 162 109 2 273
Current liabilities (37) (94) (1) (132)
Net assets 125 15 1 141
Net assets
125
15
1
141
A 5% strengthening of the US Dollar against the above currencies would have
had the equal but opposite effect on the above currencies to the amounts shown
above on the basis that all other variables remain constant.
23 Controlling party and ultimate controlling party
The directors consider the ultimate controlling party to be Burnbrae Limited
and its beneficial owner Jim Mellon by virtue of their combined shareholding
of 63.10%.
24 Post balance sheet events
There have been no material events since the end of the reporting period that
require disclosure in the accounts.
This information is provided by RNS
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