REG - Windar Photonics PLC - Final Results
25/11/2022 18:45
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RNS Number : 6929H Windar Photonics PLC 25 November 2022
25 November 2022
Windar Photonics plc
("Windar" or the "Company")
Final Results and Notice of General Meeting
Windar Photonics plc (AIM:WPHO), the technology group that has developed a
cost efficient and innovative LiDAR wind sensor for use on electricity
generating wind turbines, is pleased to announce its final audited results for
the year ended 31 December 2021 ("FY21").
Notice of Annual General Meeting
The Company is please to confirm that its Annual General Meeting (the "AGM")
will be held at the offices of West Hill Corporate Finance Ltd, 85 Gresham
Street, London, EC2V 7NQ at 1.00 p.m. on 21 December 2022.
The Company will include all valid proxy votes (whether submitted
electronically or in hard copy form) in its polls at the AGM and the Chair of
the meeting will call for a poll on each resolution. The Company accordingly
requests that shareholders submit their proxy votes in respect of the
resolutions as set out in the Notice of the AGM, electronically or by post in
advance, in accordance with the instructions set out in the Notice of the AGM.
Shareholders should submit their votes via proxy as early as possible, and
shareholders are requested to appoint the Chairman of the meeting as their
proxy. If a shareholder appoints someone else as their proxy, that proxy will
not be able to attend the AGM in person or cast the shareholder's vote.
Copies of the Annual Report and Accounts for the year ended 31 December 2021
and the Notice of the Annual General Meeting are available from the Company's
website - www.windarphotonics.com
Copies of the Annual Report and Accounts for FY21 and the Notice of the Annual
General Meeting will be posted to shareholders today and will be available
from the Company's website - www.windarphotonics.com
(http://www.windarphotonics.com)
For further information:
Windar Photonics plc Tel: +45 24234930
Jørgen Korsgaard Jensen, CEO
Cenkos Securities plc (Nomad & Broker)
Neil McDonald / Pete Lynch Tel: 0131 220 6939
About Windar:
Windar Photonics is a technology group that develops cost-efficient and
innovative Light Detection and Ranging ("LiDAR") optimization systems for use
on electricity generating wind turbines. LiDAR wind sensors in general are
designed to remotely measure wind speed and direction.
http://investor.windarphotonics.com (http://investor.windarphotonics.com)
CHAIRMAN'S STATEMENT
Despite entering 2021 with a substantial order backlog and a positive outlook
regarding potential new orders on the back of the very positive results
realized in our test projects in North America during 2020, the ongoing
COVID-19 pandemic unfortunately continued to have a significant impact on the
ability of the Company to deliver orders during the year. Consequently, the
Company generated revenue of €0.6 million, a decrease of 59% compared to
2020 (€1.3 million). Gross profit for the year amounted to €0.4 million, a
decrease of 36% compared to 2020 (€0.7 million).
During the year the Company reduced the operational expenses by 16% compared
to 2020, which despite the substantially lower revenue level meant the net
loss for the year was reduced by 19% to €1.1 million (2020: loss of €1.3
million).
At the onset of the COVID-19 pandemic the Company's revenue base was dominated
by reliance on China, which accounted for approximately 80% of total revenue
in the years 31 December 2019 and 31 December 2020. One of the main targets
for the Company since early 2020 has been to reach a greater degree of balance
between revenue in China and the rest of the world. A key achievement in 2021
was the generation of the first two major volume orders from North America
through our distribution partnership with Vestas Service. This meant that the
majority of the order backlog of €2.6 million at 31 December 2021 (2020;
€1.6 million) were orders to the rest of the world.
The product offering behind the above-mentioned orders is our WindEye™ LiDAR
product including the integrated WindTimizer functionality. Today, the Company
is the only LiDAR manufacture world-wide that has such a Plug'n'play turbine
integration module, whereby the WindTimizer functionality enables a simple
turbine integration without any need for changes to the existing wind turbine
controller. This capability means that once installed, the Average Energy
Production (AEP) has been shown to be increased by 3% but on top of this the
WindTimizer functionality includes additional programable offset features,
whereby the wind turbine loads and more importantly turbine alarms/stops can
be reduced when operating about rated power. This all means that the current
product offerings not only include precise and robust remote wind measurements
but also an extension to the existing wind turbine controller for further
optimization of the individual wind turbine without making any changes to the
turbine controller software- or hardware.
During the year to 31 December 2021, the Company has continued its wind
analytic development projects like Wake and Turbulence detection, all
developments to date are being fully integrated in the above mentioned
WindTimizer functionality, as these data points are essential for achieving
the optimal optimization of the individual wind turbine. Further, in 2021 the
Company completed a development project whereby the WindTimizer functionality
can now also interface with analogue wind sensors and thereby increase the
overall market potential for this product offering. Ongoing development
projects include wind gust integration for further enhancing the WindTimizer
functionality in respect of further potential wind turbine load reductions,
customisation project of our WindVision™ system in partnership with one of
the leading wind turbine manufactures in Europe and finally a drone based gas
emission detection product for cost efficiently being able to detect gas
emissions like Co2 etc. All of these projects are expected to be finalized
within the coming two years.
Financial Overview
Revenue during the year decreased 59% to €0.6 million (2020: €1.3
million). Gross profit was down 36% (2020: 28%) to €0.4 million (2020:
€0.7 million).
Net loss for the year before taxes decreased to €1.4 million from €1.6
million in 2020, which included depreciation, amortisation and warrant costs
of €0.3 million (2020: €0.3 million) in aggregate.
The Group held cash balances at the end of the year of €0.04 million (2020:
€0.63 million).
Trade receivables were €1.0 million (2020: €0.4 million), reflecting that
trade receivables at the end of the year included a substantial outstanding in
respect of prepayment on orders received then in hand.
The Group has capitalised its continued cost of investment in technology
during the year of €0.7 million in 2021 (2020: €0.5 million) before grants
of €0.4 million (2020: €0.2 million).
Outlook
Entering 2022 the company had a strong order backlog of €2.6 million
predominately driven by initial volume orders received through our partnership
with Vestas Service. Further orders included in the backlog were received for
new test projects in North America and Japan. Similarly, the Company has
received new orders from the Chinese market in 2022, and total order intake in
2022 has exceeded more than €3.0 million so far. In general, the Company has
noticed an increased interest in its general product offerings due to the
general increase in the global energy prices, and the Board expects to receive
additional substantial orders within the near future.
Despite the very positive market situation, the Company endured severe delays
and closures during the first half of 2022 due to COVID-19 lock downs,
affecting deliveries of certain mechanical and electronic components.
Consequently, realized revenue and deliveries were substantially below
expectations during that period though still above revenue realized in the
same period of 2021. Even though challenges still exist for the sourcing of
certain components, the Company has in the second half of 2022 already noted a
substantial improved development in relation to all important key performance
indicators.
Due to the pandemic delays experienced during the first 6 months of 2022, the
Board initiated activities for a new capital raise in the second half of 2022.
The Board is pleased to announce that subject to readmission of trading on
AIM, the Company has successfully raised €2.4 million (before costs) at an
issue price of 15p per share. Board member participation in the capital raise
is expected to constitute approximately 10% of the total capital raise. The
proceeds of the capital raise will be put to use for working capital purposes
and ensures the Company has a strong financial position to facilitate the
delivery of the order book to customers in timely manner. Further, after the
end of the accounting period the Company renegotiated the repayment schedule
of the Growth Fund loan, whereby €0.4 million currently recognized as short
term debts at the end of the accounting period would have been deemed as
long-term debts if new terms applied. Given these actions and combined with
the continued progress of the underlying positive development of the general
business activities, the board is convinced the Company has sufficient cash
flows for operations for the coming 12 months period.
Positively, given the total order inflow in 2021 and so far in 2022, the order
backlog currently amounts to approximately €3.8 million. The Board believes
the Group will report substantial improvements in revenue and probability in
both 2022 and 2023 compared to 2021.
Finally, and despite the very unexpected challenges the COVID-19 pandemic once
again brought upon us in both 2021 and so far in 2022, I would like to take
the opportunity to thank the management and staff for their efforts and
loyalty to the Company in 2021.
BY ORDER OF THE BOARD ON NOVEMBER 25, 2022
Johan Blach Petersen
Chairman
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2021
Year ended Year ended
31 December 2021 31 December 2020
€ €
Revenue from contracts with customers 551,535 1,333,956
Cost of goods sold (105,322) (632,586)
Gross profit 446,213 701,370
Administrative expenses (1,882,094) (2,183,141)
Other operating income 32,271 32,196
Loss from operations (1,403,610) (1,449,575)
Finance income/(expense) 25,520 (143,110)
Loss before taxation (1,378,090) (1,592,685)
Taxation 248,913 252,517
Loss for the year attributable to the ordinary equity holders of Windar (1,129,177) (1,340,168)
Photonics Plc
Other comprehensive income
Items that will or may be reclassified to profit or loss:
Exchange gains/(losses) arising on translation of foreign (92,348) 22,585
operations
Total comprehensive loss for the year attributable to the ordinary equity (1,221,525) (1,317,583)
holders of Windar Photonics Plc
Loss per share attributable to the ordinary equity holders of Windar Photonics
Plc
Basic and diluted, cents per share (2.1) (2.7)
All activities relate to continuing operations.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2021
31 December 2021 31 December 2020
€ €
Assets
Non-current assets
Intangible assets 1,195,267 1,205,243
Property, plant & equipment 2,423 27,698
Deposits 26,398 25,382
Total non-current assets 1,224,088 1,258,323
Current assets
Inventory 694,969 636,785
Trade receivables 991,734 429,241
Other receivables 157,919 220,047
Tax credit receivables 265,620 253,030
Prepayments 33,954 14,195
Cash and cash equivalents 40,548 626,361
Total current assets 2,184,744 2,179,659
Total assets 3,408,832 3,437,982
Equity
Share capital 675,664 675,664
Share premium 14,502,837 14,502,837
Merger reserve 2,910,866 2,910,866
Foreign currency reserve (88,394) 3,955
Retained earnings (18,758,348) (17,651,945)
Total equity (757,375) 441,377
Non-current liabilities
Warranty provisions 36,150 38,493
Holiday Allowance provisions 131,877 129,879
Loans 1,371,076 1,719,825
Total non-current liabilities 1,539,103 1,888,197
Current liabilities
Trade payables 544,330 640,899
Other payables and accruals 758,234 229,431
Contract liabilities 951,606 215,905
Loans 372,934 22,173
Total current liabilities 2,627,104 1,108,408
Total liabilities 4,166,207 2,996,605
Total equity and liabilities 3,408,832 3,437,982
The financial statements were approved and authorised for issue by the Board
of Directors on November 25 2022 and were signed below on its behalf by:
Jørgen Korsgaard Jensen, Director
COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2021
31 December 31 December
2021 2020
€ €
Assets
Non-current assets
Investments in subsidiaries - 142,497
Total non-current assets - 142,497
Current assets
Other receivables 12,898 11,295
Intragroup receivables 88,373 2,074
Cash and cash equivalents 4,454 543,247
Total current assets 105,725 556,616
Total assets 105,725 699,113
Equity
Share capital 675,664 675,664
Share premium 14,502,837 14,502,837
Merger reserve 658,279 658,279
Foreign exchange reserve (7,746) (7,746)
Retained earnings (16,088,210) (15,387,653)
Total equity (259,176) 441,381
Current liabilities
Trade payables 186,271 167,952
Other payables and accruals 178,630 89,780
Total liabilities 364,901 257,732
Total equity and liabilities 105,725 699,113
The Company has taken advantage of the exemption allowed under section 408 of
the Companies Act 2006 and has not presented its own Statement of
comprehensive income in these financial statements. The loss after tax of the
parent Company for the year was €700,557 (2020 - loss €1,367,934).
The financial statements were approved and authorised for issue by the Board
of Directors on November 25, 2022, and were signed below on its behalf by:
Jørgen Korsgaard Jensen, Director
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2021
Year ended Year ended
31 December 2021 31 December 2020
€ €
Loss for the period before taxation (1,378,090) (1,592,685)
Adjustments for:
Finance (income)/expense (25,520) 143,110
Amortisation 254,339 286,903
Depreciation 25,115 38,752
Received tax credit 213,362 212,864
Foreign exchange (gain)/losses (92,348) 22,691
Share option and warrant costs 22,773 27,020
(980,369) (861,345)
Movements in working capital
Changes in inventory (58,183) 382,779
Changes in receivables (500,363) (453,281)
Changes in prepayments (19,760) 30,683
Changes in deposits (1,017) (401)
Changes in trade payables (96,569) (319,788)
Changes in contract liabilities 735,700 145,951
Changes in warranty provisions (2,343) (22,677)
Changes in other payables and provisions 528,803 62,301
Cash flow from operations (394,101) (1,035,778)
Investing activities
Payments for intangible assets (652,264) (469,362)
Payments for tangible assets - (4,449)
Grants received 408,354 174,713
Cash flow from investing activities (243,910) (299,098)
Financing activities
Proceeds from issue of share capital - 975,214
Costs associated with the issue of share capital - (97,521)
Proceeds from new long-term loans - 402,447
Reduction from invoice discounting - (1,992)
Repayment of loans (22,180) (5,171)
Interest paid 51,006 (74,357)
Cash flow from financing activities 28,826 1,198,620
Net increase/(decrease) in cash and cash equivalents (609,185) (136,256)
Exchange differences 23,372 (407)
Cash and cash equivalents at the beginning of the year 763,024
626,361
Cash and cash equivalents at the end of the year 40,548 626,361
COMPANY STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2021
Year ended Year ended
31 December 2021 31 December 2020
€ €
Loss for the period before taxation (700,557) (1,367,934)
Adjustments for:
Finance Income (20,332) (16,946)
Write down of investment in subsidiary 559,137 1,116,716
Share option and warrant costs - 27,020
(161,752) (241,144)
Movements in working capital
Changes in receivables (1,603) 495
Changes in prepayments - 26,599
Changes in loans to subsidiary entity (67,728) 61,161
Changes in trade payables 18,320 35,163
Changes in other payables and provisions 88,850 4,084
Cash flow from operations (123,913) (113,642)
Investing activities -
Loan to subsidiary
Additional investment in subsidiary undertaking (416,640) (739,317)
Cash flow from investing activities (416,640) (739,317)
Financing activities
Proceeds from issue of share capital - 975,214
Costs associated with the issue of share capital - (97,521)
Currency gains during the year 1,760 (3,200)
Cash flow from financing activities 1,760 874,493
Net decrease in cash and cash equivalents (538,793) 21,534
Cash and cash equivalents at the beginning of the year 543,247 521,713
Cash and cash equivalents at the end of the year 4,454 543,247
CONSOLIDATED AND COMPANY STATEMENTS OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2021
Share Share Merger reserve Foreign currency reserve Accumulated Losses Total
Capital
Premium
€ € € € € €
Group
At 1 January 2020 608,689 13,692,119 2,910,866 (18,630) (16,338,796) 854,248
New shares issued 66,975 908,239 - - - 975,214
Costs associated with capital raise
- (97,521) - - - (97,521)
Share option and warrant costs - - - - 27,020 27,020
Transaction with owners 66,975 810,718 - - 27,020 904,713
Loss for the year
- - - - (1,340,168) (1,340,168)
Other comprehensive gains - - - 22,584 - 22,584
Total comprehensive loss - - - 22,584 (1,340,168) (1,317,584)
At 31 December 2020 675,664 14,502,837 2,910,866 3,954 (17,651,944) 441,377
New shares issued - - - - - -
Costs associated with capital raise - - - - - -
Share option and warrant costs - - - - 22,773 22,773
Transaction with owners - - - - 22,773 22,773
Loss for the year - - - - (1,129,177) (1,129,177)
Other comprehensive gains/(loss) - - - (92,348) - (92,348)
Total comprehensive loss - - - (92,348) (1,129,177) (1,221,525)
At 31 December 2021 675,664 14,502,837 2,910,866 (88,394) (18,758,348) (757,375)
Company
Share Share Merger reserve Foreign currency reserve Accumulated Losses Total
Capital
Premium
At 1 January 2020 608,689 13,692,119 658,279 (7,746) (14,046,739) 904,602
New shares issued 66,975 908,239 - - - 975,214
Costs associated with capital raise
- (97,521) - - - (97,521)
Share option and warrant costs - - - - 27,020 27,020
Transaction with owners 66,975 810,718 - - 27,020 904,713
Loss for the year
- - - - (1,367,934) (1,367,934)
Total comprehensive loss - - - - (1,367,934) (1,367,934)
At 31 December 2020 675,664 14,502,837 658,279 (7,746) (15,387,653) 441,381
Loss for the year - - - - (700,557)
(700,557)
Total comprehensive loss - - - - (700,557) (700,557)
675,664 14,502,837 658,279 (7,746) (16,088,210) (259,176)
At 31 December 2021
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
1. General information
The Company is a public limited company domiciled in the United Kingdom and
incorporated under registered number 09024532 in England and Wales. The
Company's registered office is 3 More London Riverside, London, SE1 2AQ.
The Group was formed when the Company acquired on 29 August 2014 the entire
share capital of Windar Photonics A/S, a company registered in Denmark through
the issue of Ordinary Shares.
2. Adoption of new and revised International Financial Reporting Standards
New and amended standards adopted by the Group
Several amendments and interpretations apply for the first time in 2021.
Effective for annual
Standard or periods beginning
Interpretation Title on or after
IFRS 16 COVID-19-Related Rent Concessions 1 June 2020
(Amendment to IFRS 16)
IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16 Interest Rate Benchmark Reform - Phase 2 1 January 2021
(Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16)
The above new and amended standards which apply for the first time for these
2021 financial statements have been assessed by the Directors and to the
extent that they may be applicable, the Directors have concluded that none of
these have had a material impact to the Group's financial statements.
Standards, amendments and interpretations issued and effective in 2021 but not
relevant
There are no IFRSs or IFRIC interpretations that are effective and not
relevant to the Group.
Standards, amendments and interpretations issued but not yet effective in 2021
There were a number of standards and interpretations which were in issue at
31 December 2021 but not effective for periods commencing 1 January 2021 and
have not been adopted for these financial statements. The Directors have
assessed the full impact of these accounting changes on the Company. To the
extent that they may be applicable, the Directors have concluded that none of
these pronouncements will cause material adjustments to the Group's financial
statements. They may result in consequential changes to the accounting
policies and other note disclosures. The new standards will not be early
adopted by the Group and will be incorporated in the preparation of the Group
financial statements from the effective dates noted below.
Effective for annual
Standard or periods beginning
Interpretation Title on or after
IFRS 16 COVID-19-Related Rent Concessions beyond 30 June 2021. (Amendment to IFRS 16) 1 April 2021
IAS 37 Onerous Contracts - Cost of Fulfilling a Contract. (Amendments to IAS 37) 1 January 2022
IAS 16 Property, Plant and Equipment: Proceeds before Intended Use. (Amendments to 1 January 2022
IAS 16)
IFRS Annual Improvements to IFRS Standards 2018-2020 1 January 2022
IFRS 3 Reference to the Conceptual Framework. (Amendments to IFRS 3) 1 January 2022
IAS 1 Classification of Liabilities as Current or Non-current. (Amendments to IAS 1) 1 January 2023
2. Adoption of new and revised International Financial Reporting Standards (continued)
IFRS 17 IFRS 17 Insurance Contracts and amendments to IFRS 17 Insurance Contracts. 1 January 2023
IAS 1 Disclosure of Accounting Policies. (Amendments to IAS 1 and IFRS Practice 1 January 2023
Statement 2)
IAS 12 Deferred Tax related to Assets and Liabilities arising from a Single 1 January 2023
Transaction. (Amendments to IAS 12)
IAS 8 Definition of Accounting Estimates. (Amendments to IAS 8) 1 January 2023
There are no other IFRSs or IFRIC interpretations that are not yet effective
that would be expected to have a material impact on the Group.
3. Going Concern
The consolidated financial statements have been prepared assuming the Group
will continue as a going concern. Under the going concern assumption, an
entity is anticipated to continue in business for the foreseeable future with
neither the intention nor the necessity of liquidation, ceasing trading or
seeking protection from creditors pursuant to laws or regulations.
Based on the Group's latest trading expectations and associated cash flow
forecasts, the directors have considered the cash requirements of the Group.
The directors are confident that based on the Group's forecasts and the
recently announced expected capital raise of approximately €2.4 million
(before costs). Further included in the considerations is the negotiated
change of the repayment schedule of the Growth Fund loan in 2022, whereby
€0.4 million currently recognized as short term debts at the end of the
accounting period would have been deemed as long-term debts if new terms
applied. Given these actions and combined with the continued progress of the
underlying positive development of the general business activities, the board
is convinced the Company has sufficient cash flows for operations for the
coming 12 months period.
Due to primarily the above stated uncertainties regarding the COVID-19
situation, the Management highlight the very high levels of uncertainties
which indicates the existence of a material uncertainty which may cast
significant doubt about the Group's ability to continue as a going concern and
therefore it may be unable to realise its assets and discharge its liabilities
in the normal course of business. The financial statements do not include the
adjustments that would result if the Group was unable to continue as a going
concern.
4. Accounting policies
Basis of preparation
The consolidated financial statements comprise the consolidated financial
information of the Group as at 31 December 2021 and are prepared under the
historic cost convention, except for the following:
· share based payments and share option and warrant costs
The principal accounting policies adopted in the preparation of the financial
information are set out below.
The financial statements have been prepared in accordance with International
Financial Reporting Standards, International Accounting Standards and
Interpretations (collectively "IFRSs") issued by the International Accounting
Standards Board (IASB) as adopted by the United Kingdom ("adopted IFRSs").
These are the first financial statements prepared under UK adopted
international accounting standards. On 31 December 2020, IFRS as adopted by
the European Union at that date was brought into UK law and became UK adopted
international accounting standards, with future changes being subject to
endorsement by the UK Endorsement Board. Windar Photonics Plc transitioned to
UK-adopted International Accounting Standards in its consolidated and parent
company financial statements on 1 January 2021. This change constitutes a
change in accounting framework. However, there is no change on recognition,
measurement or disclosure in the financial year reported as a result of the
change in framework.
The acquisition of the subsidiary in 2014 was deemed to be a business
combination under common control as the ultimate control before and after the
acquisition was the same. As a result, the transaction is outside the scope of
IFRS 3 and has been included under the principles of merger accounting by
reference to UK GAAP.
5. Revenue
Revenue from contracts with customers: Year ended Year ended
31 December 2021
31 December 2020
€ €
Sale of products and installation 550,558 1,325,951
Rendering of services 977 8,005
Revenue 551,535 1,333,956
Disaggregation of revenue
The disaggregation of revenue from contracts with customers is as follows:
Year ended Year ended
31 December 2021
31 December 2020
€ €
WindEye™ 256,663 770,531
WindVision™ 293,895 555,420
Rendering of services 977 8,005
Revenue 551,535 1,333,956
Contract liabilities of €951,606 (2020: €215,905) relates to performance
obligation under contracts that have not yet been completed and are expected
to be met in 2022.
6. Loss from operations
Loss from operations is stated after:
Year ended Year ended
31 December 2021
31 December 2020
€
€
Staff costs (note 11) 1,072,454 1,263,759
Expensed research and development costs 328,582 489,375
Amortisation(1) 254,339 286,903
Depreciation 25,115 38,752
Lease payments 108,589 115,350
Other Operating Income (32,271) (32,196)
Remuneration received by the Group's auditor or associates of the Group's
auditor:
- Audit of parent company 8,340 5,133
- Additional amounts relating to the prior year group audit charged during the 12,774 35,715
current year
- Audit of consolidated financial statements
- Taxation compliance services Other auditors: 22,638 18,120
953 830
- Audit of overseas subsidiaries 25,071 18,803
(1) Amortisation charges on the Group's intangible assets are recognised in
the administrative expenses line item in the consolidated statement of
comprehensive income.
7. Segment information
Operation segments are reported as reported to the chief
operation decision maker.
The Group has one reportable segment being the sale of LiDAR Wind Measurement
and therefore segmental results and assets are disclosed in the consolidated
income statement and consolidated statement of financial position.
In 2021, two customers accounted for more than 25 per cent of the revenue each
(2020: four customers). The total amount of revenue from these customers
amounted to €302,199 or 55 per cent of the total revenue (2020: €1,076,841
or 81 per cent of the revenue)
Revenue by geographical location of customer:
Year Year
ended
ended
31 December 2021
31 December 2020
€
€
Europe 7,519 119,340
Americas - 54,218
China 544,016 1,128,722
Asia (excluding China) - 31,676
Revenue 551,535 1,333,956
Geographical information
The parent company is based in the United Kingdom. The information for the
geographical area of non-current assets is presented for the most significant
area where the Group has operations being Denmark.
As at 31 December 2021 As at 31 December 2020
€ €
Denmark 1,216,037 1,248,460
Non-current assets for this purpose consist of property, plant and equipment
and intangible assets.
8. Directors and employees
2021 2020
Average Year end Average Year end
Number of employees excluding directors
Sales and Services 7 5 7 6
Research and development 11 13 10 10
Production 4 4 2 2
Administration 3 3 3 3
25 25 22 21
Group 2021 2020
€ €
Staff costs
Wages and salaries 971,863 1,190,757
Social security costs 77,818 45,982
1,049,681 1,236,739
Warrant and Option costs 22,773 27,020
1,072,454 1,263,759
2021 2020
Company
€ €
Staff costs
Wages and fees 13,450 25,760
13,450 25,760
Warrant and Option costs - 27,020
13,450 52,780
The Company has 3 employees (2020: 3), all being the Directors of the Company.
Key management personnel compensation
Key management personnel are those persons having authority and responsibility
for planning, directing and controlling the activities of Group, and are
considered to be directors of the company.
The value of all elements of remuneration received by key management in the
year was as follows:
Wages and salaries and fees Fair value of warrant costs Pension contributions Total
€ € € €
Year ended 31 December 2021
Directors 13,450 - - 13,450
Year ended 31 December 2020
Directors 25,760 - - 25,760
9. Finance income/(expense)
Year Year
ended
ended
31 December 2021
31 December 2020
€
€
Foreign exchange gains 143,019 (32,746)
Interest expense on financial liabilities measured at amortised cost (117,499) (110,364)
Finance income/(expense) 25,520 (143,110)
10. Income tax
Year ended 31 December 2021 Year ended 31 December 2020
€ €
(a) The tax credit for the year:
UK Corporation tax - -
Foreign tax credit (248,913) (252,517)
(b) Tax reconciliation
Loss on ordinary activities before tax (1,378,090) (1,592,685)
Loss on ordinary activities at the UK standard rate of corporation tax 19%
(2020: 19%)
(261,837) (302,610)
Effects of:
Expenses non-deductible for tax purposes (28,618) (35,103)
Adjustment to not recognized deferred taxes in previous periods 23,583 (137,902)
Unrecognised tax losses 118,873 263,464
Different tax rates applied in overseas jurisdictions (47,098) (54,860)
Exchange rate differences (53,816) 14,494
Tax credit for the year (248,913) (252,517)
The tax credit is recognised as 22 per cent. (2020: 22 per cent) of the
company's deficit that relates to research and development costs. Companies in
Denmark, who conduct research and development and accordingly experience
deficits can apply to the Danish tax authorities for a payment equal to 22 per
cent. (2020; 22 per cent) of deficits relating to research and development
costs up to DKK 25 million.
(c) Deferred tax - Group
In view of the tax losses carried forward and other timing differences there
is a deferred tax asset of approximately €2,948,012 (2020: €2,829,139)
which has not been recognised in these Financial Statements, given uncertainty
around timing and availability of sufficient taxable profits in the relevant
Company.
(d) Deferred tax - Company
In view of the tax losses carried forward and other differences there is a
deferred tax asset of approximately €389,814 (2020: €338,140) which has
not been recognised in these Financial Statements, given uncertainty around
timing and availability of future profit against which the losses will be able
to be used.
All taxes recognized in the statement of Comprehensive income are denominated
in DKK.
11. Loss per share
The loss and weighted average number of ordinary shares used in the
calculation of basic loss per share are as follows:
Year ended Year ended
31 December
31 December
2021
2020
€ €
Loss for the year (1,129,177) (1,340,168)
Weighted average number of ordinary shares for the purpose of basic earnings 54,595,522 49,819,356
per share
Basic loss and diluted, cents per share (2.1) (2.7)
There is no dilutive effect of the warrants (note 25) as the dilution would
reduce the loss per share.
12. Dividends
No dividends were proposed by the Group during the period under review (2020:
€Nil).
13. Investment in Subsidiaries
€
Company
At 1 January 2021 142,497
Capital contribution in the year 416,640
Write down investment in subsidiary (559,137)
As at 31 December 2021 0
The subsidiaries of Windar Photonics Plc are included in these financial
statements in accordance with the merger accounting as set out in the basis of
preparation and basis of consolidation in notes 4, are as follows:
Name Country of incorporation Ownership Registered Office Nature of business
Windar Photonics A/S Denmark Helgeshoej Allé 16-18,2630 Taastrup, Develop and commercialise wind turbine technology
100% Denmark
Windar Photonics (Shanghai) Co. Ltd. China 100% indirect Room 403-03, Building #2, No. 38 Debao Road, Pudong, Shanghai Commercialise wind turbine technology
The Company owns 100 per cent. of the issued share capital of Windar Photonics
A/S (comprising A Shares of DKK 5,737,800 of 1 DKK each and B Shares of DKK
3,642,592 of 1 DKK each) with CVR number 32157688.
Windar Photonics A/S was incorporated on 28 December 2008 in Denmark and
acquired by the Company in August 2014. During the year the Company invested
the funds received from the share placing into its main trading subsidiary,
Windar Photonics A/S, and a total transfer of funds of €484,368 was made
during the year. A further waiver of intercompany receivable due from Windar
Photonics A/S of €416,640 was made during the year and treated as capital
contribution.
Windar Photonics A/S owns 100 per cent. of the issued common stock of Windar
Photonics (Shanghai) Co.,Ltd. Windar Photonics (Shanghai) Co. Ltd. was
incorporated on 18 May 2016 in China with a registered capital of USD 200,000
of which USD 200,000 is paid in as per 31 December 2021.
14. Intangible assets
Group Development projects
€
Cost
At 1 January 2020 3,465,358
Additions - internally developed 469,362
Grants received (174,713)
Exchange differences 14,759
At 31 December 2020 3,774,766
Additions - internally developed 652,264
Grants received (408,354)
Exchange differences 1,437
At 31 December 2021 4,020,113
Accumulated amortisation
At 1 January 2020 2,272,751
Charge for the year 286,903
Exchange differences 9,869
At 31 December 2020 2,569,523
Charge for the year 254,339
Exchange differences 984
At 31 December 2021 2,824,846
Net carrying value
At 1 January 2020 1,192,607
At 31 December 2020 1,205,243
At 31 December 2021 1,195,267
The Group has received public Research and Development Grants of €408,354
(2020: €174,713) in respect of the capitalised research and development. At
the end of the year 3 development projects are ongoing which are supported by
public Research and Development Grants and outstanding grants which can be
claimed in the coming two years amount to €402,893 (2020: €669,605, which
could be claimed in the following 4 years).
The company's development projects relate to the development of improved
performance and functionality, improved components etc. in the company's
products.
Measurement of the development projects are based on realization of the
company's business plan and budgets,
particularly realization of expected growth in revenue.
15. Property, plant & equipment
Group Plant and equipment
€
Cost
At 1 January 2020 221,689
Additions 4,449
Disposed -
Exchange differences 771
At 31 December 2020 226,909
Additions -
Disposed -
Exchange differences 1,313
At 31 December 2021 228,222
Accumulated depreciation
At 1 January 2020 159,889
Charge for the year 38,752
Disposed -
Exchange differences 570
At 31 December 2020 199,211
Charge for the year 25,111
Disposed -
Exchange differences 1,477
At 31 December 2021 225,799
Net carrying value
At 1 January 2020 61,800
At 31 December 2020 27,698
At 31 December 2021 2,423
16. Inventory
Group
As at As at
31 December 2021
31 December 2020
€ €
Raw material 363,216 16,145
Work in progress 46,879 181,598
Finished goods 284,874 439,042
Inventory 694,969 636,785
The cost of inventory sold and recognised as an expense during the year was
€107,679 (2020: €655,086).
17. Trade and other receivables
Group Company
As at As at As at As at
31 December
31 December
31 December
31 December
2021
2020
2021
2020
€
€
€
€
Trade receivables 1,865,023 1,301,858 - -
Less; provision for impairment of trade receivables (873,289) (872,617) - -
Trade receivables - net 991,734 429,241 - -
Receivables from related parties - - 88,373 2,074
Total financial assets other than cash and cash equivalents classified at 991,734 429,241 88,373 2,074
amortised costs
Tax receivables 265,620 253,030 - -
Other receivables 157,919 220,047 12,898 11,295
Total other receivables 423,539 473,077 12,898 11,295
Total trade and other receivables 1,415,273 902,318 12,898 13,369
Classified as follows:
Current Portion 1,415,273 902,318 101,271 13,369
The carrying value of trade and other receivables classified at amortised cost
approximates fair value.
More than More than More than Total
30 days
60 days
120 days
past due
past due
past due
€
€
€
€
Gross carrying amount - - 1,015,862 1,015,862
Loss provision - - (873,289) (873,289)
Net carrying amount - - 142,573 142,573
Trade and other receivables represent financial assets and are considered for
impairment on an expected credit loss model. These assets have historically
had immaterial levels of bad debt and are with credit worthy customers, and as
the Group trades with a concentrated number of customers and utilises export
credit facilities the Group has reviewed trade receivables on an individual
basis. Additionally, the Group continues to trade with the same customers and
therefore the future expected credit losses have been considered in line with
the past performance of the customers in the recovery of their receivables.
The implementation of IFRS 9 has therefore not resulted in a change to the
impairment provision in the current or prior year.
The Group applies the IFRS 9 simplified approach to measuring expected credit
losses using a lifetime expected credit loss provision for trade receivables.
The expected loss rates are based on the Group's historical credit losses
experienced over the three-year period prior to the period end. The historical
loss rates are then adjusted for current and forward-looking information on
factors affecting the Group's customers including the area of operations of
those debtors and the advancing market for wind power and the Group's
products. The assessment of the expected credit risk for the year has not
increased, when looking at the factors affecting the risk noted above.
There is no material difference between the net book value and the fair values
of trade and other receivables due to their short-term nature.
Other classes of financial assets included within trade and other receivables
do not contain impaired assets.
The Group is committed to underwrite any of the debts transferred and
therefore continues to recognise the debts sold within trade receivables until
the debtors repay or default. Since the trade receivables continue to be
recognised, the business model of the Group is not affected. The proceeds from
transferring the debts of are included in other financial liabilities until
the debts are collected or the Group makes good any losses incurred by the
service provider.
18. Cash and cash equivalents
For the purpose of the cash flow statement, cash and cash equivalents comprise
the following balances with original maturity less than 90 days:
Group Company
As at As at As at As at
31 December
31 December
31 December
31 December
2021
2020
2021
2020
€
€
€
€
Cash at bank 40,548 626,361 4,454 543,247
The Group has restricted cash balances of €NIL (2020: € 33,672).
19. Notes supporting statement of cash flows
Non-current loans and borrowings Current loans and borrowings Total
€
€
€
As at 1 January 2020 5,174 1,267,051 1,272,225
Repayment of loans - (5,171) (5,171)
Repayment of Invoice Discounting - (1,992) (1,992)
Accrued interests on non-current loans 68,753 68,753
Loans and borrowings classified as non-current in previous period becoming (22,128) 22,128 -
current in this period
Loans and borrowings classified as current in previous period becoming 1,262,084 (1,262,084) -
non-current in this period
New long-term borrowings in the period 402,447 - 402,447
Foreign exchange rate differences 3,495 2,241 5,736
As at 31 December 2020 1,719,825 22,173 1,741,998
Repayment of loans - (22,180) (22,180)
Loans and borrowings classified as non-current in previous period becoming (372,934) 372,934 -
current in this period
Accrued interests on non-current loans 23,538 - 23,538
Loans and borrowings classified as current in previous period becoming - - -
non-current in this period
New long-term borrowings in the period - - -
Foreign exchange rate differences 647 7 654
As at 31 December 2021 1,371,076 372,934 1,744,010
The Company do not have any long- or short-term loans or borrowings.
20. Trade and other payables
Group Company
As at As at As at As at
31 December
31 December
31 December
31 December
2021
2020
2021
2020
€
€
€
€
Trade payables 544,330 640,899 186,271 167,952
Other payables and accruals 615,932 144,323 36,328 24,084
Payables to Directors 142,302 85,108 142,302 65,696
Current portion of Nordea and Growth Fund loans 372,934 22,173 - -
Total financial liabilities, excluding 'non-current' loans and borrowings
classified as financial liabilities measured at amortised cost
892,503
1,675,498 364,901 257,732
Contract liabilities 951,606 215,905 - -
Total trade and other payables 2,627,104 1,108,408 364,901 257,732
Classified as follows:
Current Portion 2,627,104 1,108,408 364,901 257,732
There is no material difference between the net book value and the fair values
of current trade and other payables due to their short-term nature.
Søren Høffer resigned as Director 16 March 2021, only included under
Payables to Directors at the end of 2020.
21. Borrowings
The carrying value and fair value of the Group's borrowings are as follows:
Group
Carrying and Fair value
Loans As at As at
31 December
31 December
2021
2020
€
€
Growth Fund 1,744,010 1,736,802
Current portion of Growth Fund
(372,934) (16,977)
Nordea Ejendomme - 5,196
Current portion of Nordea Loan - (5,196)
Total non-current financial liabilities measured at amortised costs 1,371,076 1,719,825
The Growth Fund borrowing from the Danish public institution, Vækstfonden,
initially bore interest at a fixed annual rate of 12 per cent with a full
bullet repayment in June 2020. As announced in 2020 terms for the borrowing
was renewed during the year whereafter the interest rate was reduced to 7
percent p.a. and the loan to be repaid in quarterly instalments over the
period from 1 January, 2022 until 1 October, 2026. A new Covid-19 loan was
further obtained during 2020 from Vækstfonden which carries an interest rate
of CIBOR plus 5 percent p.a. and to be repaid in quarterly instalments over
the period from 1 October 2021 until 1 October 2026.
In 2020 relation with the changes to the existing Growth Fund borrowing and
the new offered loan, the lender now has security of the assets of Windar
Photonics A/S, subsidiary undertaking, to an amount of DKK12.6m. In relation
to the additional Covid-19 loan the following terms and conditions are in
place:
· There is an early exit fee set at a maximum DKK600k
· No dividends or corporate bond interest will be paid. Dividend
distributions from Windar Photonics A/S to Windar Photonics PLC has been
restricted until full repayment of the borrowing to the Growth Fund.
· No payment of inter-company debts from Windar Photonics A/S.
Windar Photonics PLC has entered into an agreement to resign from repayments
of any outstanding amounts owned by Windar Photonics A/S to Windar Photonics
PLC until full repayment of the borrowing to the Growth Fund.
· The loan is secured up to a value of DKK12.6m on certain assets
of Windar Photonics A/S, subsidiary undertaking.
The loan from Nordea Ejendomme is in respect of amounts included in the
fitting out of the offices in Denmark. The loan is repayable over the 6 years
and matured in November 2021 and carries a fixed interest rate of 6 per cent.
After end of the accounting period the Company has renegotiated the repayment
schedule of the Growth Fund loan, whereby €0.4 million currently recognized
as short term debts at the end of the accounting period would have been deemed
as long-term debts if new terms applied.
Both loans are denominated in Danish Kroner.
The Company had no borrowings.
22. Share capital
Authorised € Authorised €
2021 2021 2020 2020
Shares at beginning of reporting period 54,595,524 675,664 48,584,717 608,689
Issue of share capital - - 6,010,807 66,975
Shares at end of reporting period 54,595,524 675,664 54,595,524 675,664
Number of shares issued and fully paid € Number of shares issued and fully paid €
2021 2021 2020 2020
Shares at 1 January 2021 54,595,524 675,664 48,584,717 608,689
Issue of shares for cash - - 6,010,807 66,975
Shares at 31 December 2021 54,595,524 675,664 54,595,524 675,664
At 31 December 2021 the share capital comprises 54,595,524 shares of 1 pence
each.
Warrants and share options
Warrants and share options are granted to Directors and employees.
During the year a new share option program was granted to employees in the
company. In total 475,000 share options were granted at a fixed strike price
of 40p per share.
Share options issued in 2017 and 2019 are valued using the Black-Scholes
pricing model and no performance conditions are included in the fair value
calculations. The options were issued at a strike price of £1 a third vesting
on each anniversary for the first three years whereafter the options have a
10-year life. The price of the share at the time of issue was £0.88. The
risk-free rate was 1.15%. The expected volatility is based on historical
volatility of the AIM market over the last two years and is estimated to be
40%.
The average share price during the year was 21.14 pence (2020: 22.42 pence).
At the year end the Company had the following warrants and options
outstanding:
Number of warrants and options
At At Exercise price
31 December
31 December
2020 Granted Lapsed 2021 (£ pence) Exercise date
Warrants 1,520,956 - (1,520,956) - - -
Options 557,500 475,000 - 1,032,500 72.40 16/11/18 to 01/04/35
2,078,456 475,000 (1,520,956) 1,032,500
The number of options and warrants exercisable at 31 December 2021 is warrants
NILL (2020: 1,520,956) and options 589,583 (2020: 460,000).
The weighted average remaining contractual life for the options outstanding as
at 31 December 2021 is 10.37 years (2020: 9.76 years).
No remaining life of warrants at the end of the year (2020: 1 year).
23. Reserves
The following describes the nature and purpose of each reserve within equity
Reserve Description and purpose
Share premium Amount subscribed for share capital in excess of nominal value.
Merger reserve - Group Represents the difference between the consideration paid for the acquisition
of Windar Photonics A/S by the Company and the net book value of the assets
and liabilities acquired.
Merger reserve - Company Represents the difference between the fair value and the nominal value of the
shares issued for the acquisition of Windar Photonics A/S.
Foreign currency reserve Gains and losses on the retranslating the net assets from the functional
currencies to the reporting currency of €.
Retained earnings All other net gains and losses and transactions with owners (e.g. dividends)
not recognised elsewhere.
24. Short term leases
The total future value of the minimum lease payment is due as follows:
2021 2020
€ €
Not later than one year - 41,879
Later than one year and not later than five years - -
- 41,879
All leasing commitments are in respect of property and cars leased by the
Group. The terms of property leases vary from country to country, although
they all tend to be tenant repairing with rent reviews once a year. The
Company has not entered any leases in 2021 with maturity longer than 6 months.
25. Warranty provision
2021 2020
€ €
Provision at the beginning of reporting period 38,493 61,170
Provision charged to the profit and loss account (2,358) (22,500)
Utilised in year - -
Foreign exchange rate movements 15 (177)
36,150 38,493
The Group typically provides a two-year warranty period to customers on
products sold. Warranty expenses/(income) charged to the Statement of
Comprehensive Income amounted to (€2,358) (2020: (€22,500)) corresponding
to a warranty cost percentage of Nil % (2020: Nil%) relative to the prior two
years revenue. However, due to the early business stage of the Group and the
uncertainty following this the Group has adopted a policy to accrue a 4%
provision based on the prior two years deliveries calculated with the cost of
goods sold at the end of the period.
26. Holiday allowance provision
2021 2020
€ €
Provision at the beginning of reporting period 129,879 58,848
Increase holiday allowance provision in year - 70,790
Accrued interests 1,949 -
Foreign exchange rate movements 49 241
131,877 129,879
Provision for non-current holiday allowance has been reclassified in respect
of the amounts stated above in relation to the 2020 accounts. In the 2020
accounts the provision end of 2020 was classified as Other payables and
accruals.
27. Related Party Transactions
Jørgen Korsgaard Jensen and Johan Blach Petersen are directors and
shareholders of Wavetouch Denmark A/S (Wavetouch) and OPDI Technologies A/S
(OPDI). Wavetouch has during the year rented office space from Windar
Photonics A/S, the amount payable during the year to Windar was €32,273
(2020: €32,196). There were amounts outstanding at the year end to Wavetouch
€(193,173) (2020: €23,630). At the end of the year there were amounts
outstanding to OPDI of € Nil (2020: € nil). At the end of the year there
were amounts outstanding to Jorgen Korsgaard Jensen € 77,280 (2020: €
nil), Johan Blach Petersen € 65,022 (2020: € 51,572) and Søren Høffer
€ 33,536 (2020: € 33,536).
Intercompany transactions
At 31 December 2021 there exist an intercompany loan between Windar Photonics
PLC and its subsidiary Windar Photonics A/S.
Windar Photonics PLC has a receivable at €88,373 (2020: €2,074). Interest
added during 2021 amounts to €11,054 (2020: €20,147).
The interest rate for 2021 is Bank of England base rate + 2.5% p.a. (2020:
Base rate + 2.5% p.a.).
28. Controlling Parties
There is no ultimate controlling party of the Company.
29. Post balance sheet events and outstanding lawsuits
In November 2022 the Company renegotiated the repayment schedule regarding the
Growth Fund loan further detailed in note 21. Further the Board decided to
initiate a capital raise of approximately €2.3 million (before costs) in the
second half of 2022, which is expected to complete at the end of November 2022
NOTICE OF GENERAL MEETING
NOTICE IS HEREBY GIVEN that the Annual General Meeting (the "AGM") of Windar
Photonics Plc (the "Company") will be held at the offices of West Hill
Corporate Finance Ltd, 85 Gresham Street, London, EC2V 7NQ at 1.00 p.m. on 21
December 2022 for the purpose of considering and, if thought fit, passing the
resolutions below.
Resolution 6 will be proposed as a special resolution. All other resolutions
will be proposed as ordinary resolutions.
As Ordinary Resolutions:
1. To receive and adopt the Company's annual accounts for the
financial year ended 31 December 2021 together with the Directors' report and
the auditors' report on those accounts.
2. To re-elect J K Jensen, who retires by rotation pursuant to the
articles of association of the Company and who, being eligible, offers himself
for re-election as a Director
3. To re-elect J B Petersen, who retires by rotation pursuant to the
articles of association of the Company and who, being eligible, offers himself
for re-election as a Director
4. To re-appoint Jeffreys Henry LLP as auditors of the Company to hold
office from the conclusion of this meeting until the conclusion of the next
general meeting at which the accounts are laid before the meeting.
5. To authorise the Directors to fix the remuneration of the auditors.
5.. That, in substitution for all subsisting authorities to the extent
unused, the Directors be generally and unconditionally authorised for the
purpose of section 551 of the Companies Act 2006 to exercise all the powers of
the Company to allot ordinary shares in the Company and grant rights to
subscribe for, or to convert any security into such ordinary shares (such
ordinary shares and rights to subscribe for or to convert any security into
ordinary shares being relevant securities) up to an aggregate nominal amount
of £245,700, with such authorisation to expire upon the earlier of the
conclusion of the next annual general meeting and 30 June 2023 (unless
renewed, varied or revoked by the Company prior to or on that date) after the
date of this resolution (save that the Company may before such expiry make an
offer or agreement which would or might require relevant securities allotted,
or rights to be granted, after such expiry and the directors may allot
relevant securities, in pursuance of such offer or agreement as if the
authorisation conferred hereby had not expired).
As a Special Resolution
6.. That, subject to the passing of resolution 5 above and in
substitution for all subsisting authorities to the extent unused, the
Directors be generally empowered pursuant to sections 570 and 573 of the
Companies Act 2006 (the 'CA 2006') to allot equity securities (as defined in
section 560 CA 2006) pursuant to the authority referred to in resolution 5, as
if section 561(1) CA 2006 did not apply to any such allotment, provided that
the power was:
1. limited to the allotment of equity securities in connection with an
offer of equity securities:
a. to ordinary shareholders in proportion (as nearly as may be
practicable) to their existing holdings; and
b. to holders of other equity securities as required by the rights of
those securities or as the directors otherwise consider necessary.
2. limited to the allotment of equity securities up to an aggregate
nominal amount of £245,700,
and shall expire on the earlier of the conclusion of the next annual general
meeting and 30 June 2023 (unless renewed, varied or revoked by the Company
prior to or on that date), save that the Company, may before such expiry make
an offer or agreement which would or might require equity securities to be
allotted after such expiry and the Directors may allot equity securities in
pursuance of such offer or agreement as if the power hereby conferred had not
expired.
Dated November 25, 2022
By Order of the Board
Jørgen Korsgaard
Jensen
Director
Registered Address: 3 More London Riverside, London SE1
2AQ
Registered Number: 09024532
Explanatory Notes to the Notice of Annual General Meeting ("AGM")
The notes on the following pages give an explanation of the proposed
resolutions. Resolutions 1 to 4 are proposed as ordinary resolutions. This
means that for each of those resolutions to be passed, more than half of the
votes cast must be in favour of the resolution. Resolution 6 is proposed as a
special resolution. This means that for this resolution to be passed, at least
three-quarters of the votes cast must be in favour of the resolution.
Resolution 1: Approval of the annual report and accounts
The Company is required to present its report and accounts to shareholders at
its AGM. This provides an opportunity to discuss the performance of the
Company during the year, its management and prospects for the future.
Resolutions 2: Re-election of directors
The Company's articles one third of the Directors to retire by rotation at
each AGM and at the first AGM following their appointment. The board proposes
them for re-election as Directors of the Company. Biographical details of all
directors can be found on page 9 of the 2021 annual report.
Resolutions 3 and 4: Auditors reappointment and remuneration
It is a requirement that the Company's auditor must be reappointed at each
general meeting at which financial statements are laid, in effect, at each
AGM. After considering relevant information, the Audit Committee recommended
to the Board the reappointment of Jeffreys Henry LLP. Resolution 3 proposes
Jeffreys Henry LLP's reappointment and Resolution 4 authorises the Directors
to determine their remuneration.
Resolution 5: Directors' power to allot relevant securities
Under section 551 of the Companies Act 2006, relevant securities may only be
issued with the consent of the shareholders, unless the shareholders pass a
resolution generally authorising the Directors to issue shares without further
reference to the shareholders. This resolution authorises the general issue
of shares up to an aggregate nominal value of £245,700, which is equal to 45%
of the nominal value of the current issued share capital of the Company.
Such authority will expire at the conclusion of the next AGM of the Company or
six months after the Company's accounting reference date, being 30 June 2023
(whichever is the earlier).
Resolution 6: Disapplication of pre-emption rights on equity issues for cash
Section 561 of the Companies Act 2006 requires that a company issuing shares
for cash must first offer them to existing shareholders following a statutory
procedure which, in the case of a rights issue, may prove to be both costly
and cumbersome. This resolution excludes that statutory procedure as far as
rights issues are concerned. It also enables the Directors to allot shares
up to an aggregate nominal value of £245,700, which will be equal to 45% of
the nominal value of the current issued share capital of the Company, assuming
resolution 5 being passed. The Directors believe that the powers provided by
this resolution will maintain a desirable degree of flexibility. Unless
previously revoked or varied, the disapplication will expire on the conclusion
of the next AGM of the Company or six months after the Company's accounting
reference date, being 30 June 2023 (whichever is the earlier).
Notes
1. A member of the Company entitled to vote at the meeting
convened by this notice is entitled to appoint one or more proxies to exercise
any of his rights to attend, speak and vote at that meeting on his behalf. A
proxy need not be a member of the Company but must attend the meeting to
represent you.
2. You may appoint more than one proxy provided each proxy is
appointed to exercise rights attached to different shares. You may not
appoint more than one proxy to exercise rights attached to any one share. To
appoint more than one proxy please contact Share Registrars on 01252 821390,
overseas callers should call +44 1252 821390.
3. A Form of Proxy is enclosed. To be effective, the Form of
Proxy together with any power of attorney or other written authority under
which it is signed, or a notarial certified copy or a certified copy in
accordance with the Powers of Attorney Act 1971 of such power or written
authority must be completed signed and to be valid the proxy must be duly
executed and deposited with the Company at the offices of the Company's
registrars, Share Registrars Limited, 3 The Millennium Centre, Crosby Way,
Farnham, Surrey GU9 7XX , not later than 1 p.m. on 19 December 2022.
4. Completion and return of a Form of Proxy will not prevent a
member from attending and voting in person if he or she so wishes.
5. Pursuant to Regulation 41 of the Uncertificated Securities
Regulations 2001 to be entitled to attend and vote at the meeting (and for the
purposes of the determination by the Company's register of members not less
than 48 hours before the time of the meeting or, in the event that the meeting
is adjourned, on the Register of Members of the Company not less than 48 hours
before the time of any adjourned meeting, and only such members shall be
entitled to attend and vote at the meeting in respect of the number of shares
registered in their name at that time. Changes to entries on the Register of
Members after 1 p.m. on 19 December 2022 or, in the event that the meeting
is adjourned, not less than 48 hours before the time of any adjourned meeting,
shall be disregarded in determining the rights of any person to attend and
vote at the meeting.
6. In the case of joint holders, the vote of the senior who
tenders a vote, whether in person or by proxy, will be accepted to the
exclusion of the votes of any other joint holders. For these purposes,
seniority shall be determined by the order in which the names stand in the
register of members in respect of the joint holding.
7. In the case of a corporation, the Form of Proxy must be
executed under its common seal or signed on its behalf by a duly authorised
attorney or duly authorised officer of the corporation.
8. A vote withheld option is provided on the Form of Proxy to
enable you to instruct your proxy not to vote on any particular resolution.
However, it should be noted that a vote withheld in this way is not a "vote'
in law and will not be counted in the calculation of the proportion of votes
"For" and "Against" a resolution.
9. To change your proxy instructions simply submit a new proxy
appointment using the methods set out above. Note that the cut-off time for
receipt of proxy appointments (see above) also apply in relation to amended
instructions; any amended proxy appointment received after the relevant
cut-off time will be disregarded. Where you have appointed a proxy and would
like to change the instructions using another hard-copy Form of Proxy, please
contact Share Registrars (see note 3 above). If you submit more than one
valid proxy appointment, the appointment received last before the latest time
for the receipt of proxies will take precedence.
10. In order to revoke a proxy instruction, you will need to
inform the Company using one of the following methods:
By sending a signed hard copy notice clearly stating your intention to revoke
your proxy appointment to Share Registrars Ltd, The Courtyard, 17 West Street,
Farnham, Surrey GU9 7DR. In the case of a member which is a company, the
revocation notice must be executed under its common seal or signed on its
behalf by an officer of the company or an attorney for the company. Any
power of attorney or any other authority under which the revocation notice is
signed (or a duly certified copy of such power or authority) must be included
with the revocation notice.
In either case, the revocation notice must be received by Share Registrars no
later than 1 p.m. on 19 November 2022.
If you attempt to revoke your proxy appointment but the revocation is received
after the time specified then, subject to the paragraph directly below, your
proxy appointment will remain valid.
Appointment of a proxy does not preclude you from attending the meeting and
voting in person. If you have appointed a proxy and attend the meeting in
person, your proxy appointment will automatically be terminated.
11. A copy of the proposed draft rules of the EMI and
copies of the contracts of service between each executive director and the
letters of appointment of the non-executive directors are available for
inspection during normal business hours (Saturdays, Sundays and public
holidays excepted) at the registered office of the Company. These together
with the register of directors' interests in shares, will be available for
inspection for at least 15 minutes prior to and during the AGM at the meeting
venue.
12. Except as provided above, members who have general
queries about the AGM should write to the Company Secretary, Edward Ratnam, 23
Chetwynd Park, Cannock, Staffordshire WS12 0NZ. You may not use any electronic
address provided in either this notice of AGM or any related documents
including the Form of Proxy.
As at 5.00 p.m. on the date immediately prior to this notice the Company's
issued share capital comprised 54,595,524, ordinary shares of 1 pence each.
Each ordinary share carries the right to one vote at a general meeting of the
Company and therefore the total number of voting rights in the Company is
54,595,524.
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