For immediate release

1 December 2021

Online Blockchain Plc

('Online' or 'the Company')

Audited Results for the Year Ended 30 June 2021

Online today announces preliminary results for the year ended 30 June 2021.

CEO'S STATEMENT

2021 has been a breakthrough year for us. We are very pleased with the launch of Umbria's Narni Bridge which is growing by the day. While Narni Bridge was launched at the very end of 2021, Narni Bridge's performance and uptake by its community has been promising.

Remote working (WFH, working from home) has been the "new normal" for most of us at Online Blockchain for many years, so the impact of this change for many office workers, did not disrupt us.

As an incubator, research and development company we have learnt that leading-edge technology is not necessarily looked on favourably when it is first introduced. When we started out as an internet company in the late 1990s the internet opportunity was disregarded by many in "the city". Blockchain and the technology that surrounds it is suffering another incarnation of this local reluctance and potential fear of the new.

We have moved our Blockchain activities out of the UK while continuing our activities as advisor and mentor onshore. This enables us to embrace the best possible regulatory environment and for now we have chosen Gibraltar for our blockchain operations.

We are very pleased with the continuing development of Umbria and specifically its cross-blockchain bridge, Narni, named after the Roman bridge in Umbria. The Narni bridge is designed to be a fast and cheap cross-chain bridge between Ethereum and Polygon and has been experiencing good growth. Narni will shortly bridge Ethereum and the Binance chains and then in due course other chains as well. We believe that over the next 12-18 months revenue could potentially be material. The Narni bridge remunerates liquidity providers, who enable the bridging of tokens between chains to share in a revenue stream of bridging fees for which OBC also receives a share. We believe this flow can be significant and at these early stages they are promising.

We have therefore re-focused our resources to Umbria and more specifically to the development of the Narni bridge which even at these early stages is enabling Crypto users to move six figure sums a day of tokens from Ethereum to Polygon or from Polygon to Ethereum. Post year-end we have put all our other projects into 'care and maintenance' (there is no ongoing further activity on Freefaucet.io) and have cancelled the Encyptid Games project, to focus as much as possible on the progress of Umbria. Shareholders can see the Narni bridge at www.umbria.network and monitor its progress as this is a live product that will generate revenue for us and its community.

Meanwhile, as always, we are still closely linked to ADVFN PLC through our investment in that company and below is a segment from its recent year end results which are very positive indeed with a pre-tax profit of £1,608,000. ADVFN PLC has also announced that it will be paying a dividend this year for the first time and as a 17.64% shareholder we are very pleased to hear this.  

EVENTS AFTER THE BALANCE SHEET DATE

There were no events of significance occurring after the balance sheet date to report.

INVESTMENT IN ADVFN plc

Online Blockchain Plc also has an interest of 17.64% in ADVFN Plc. The activity of ADVFN Plc is therefore of importance to the Company and information concerning ADVFN's performance is set out below which has been extracted from ADVFN's audited results for the year ended 30 June 2021 which were announced recently:

EXTRACT FROM THE ADVFN plc CHIEF EXECUTIVE'S STATEMENT

We have good cause to be delighted to present the results to 30 June 2021. Following our reorganisation in 2019 we have benefited from the silver lining that has accompanied the very dark clouds of the Covid-19 Pandemic.

While the pandemic has boosted business there are other tailwinds pushing us forwards.

There appears to have been an intersection of positive developments over this financial year that have combined to boost our business, including the Covid lockdowns and associated market disruptions, a boom in cryptocurrency markets and the rise of a new generation of traders and investors. We have of course worked hard to grow sales and control costs but the positive changes to ADVFN's business environment cannot be understated. There are always a host of difficult challenges to be faced and this year was no different, but we have solved them at the same time as enjoying a number of positive developments.

Global actions to cope with the pandemic have raised interest in trading and investing in markets and this has increased our subscriptions and advertising revenues. Cryptocurrency prices and investor interest increased substantially mid-year bringing another tailwind to support our progress. Meanwhile, our firm belief is that the next generation of traders and investors have now emerged and that this will represent a secular boost for us in the future. This last factor is possibly more important than the previous two because while emergencies come and go, and are always a business driver for us, underlying those cycles is the size of the audience; the bigger that audience the better our market.

In 2001, just after ADVFN was first floated on AIM, the stock market dotcom crash effectively drove away a generation of traders who had entered the markets as "privatisation novices" in the 1980s and 1990s and who exited the stock market as a result of losses in the Dotcom bust. Consequently, ADVFN has for much of its market existence operated against the headwinds of falling private investor participation in share ownership and stock market trading. However, we believe that falling trend has now reversed and that the next generation of new investors is here and increasingly engaging with the markets, initially through cryptocurrency interest but also responding to the allure of Fintech developments and showing increased interest in stocks. This is most clearly the case in the US, but it is also occurring elsewhere. This is a positive development and we expect it to continue.

At the year-end both advertising and subscription income were up on the previous year and consequently we have delivered a pre-tax profit of £1,608,000.

SUMMARY OF ADVFN'S KEY PERFORMANCE INDICATORS

Clement Chambers

CEO

30 November 2021

The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. The person who arranged for the release of this announcement on behalf of the Company was Clement Chambers, Director.

Enquiries:

For further information please contact: 

STRATEGIC REPORT

The Directors present their Strategic Report for the year ended 30 June 2021.

The strategy for the Group is that of an incubator and developer of businesses in internet and information-based technologies including developers, administrators and custodians of blockchains and cryptocurrencies. 

We founded ADVFN www.advfn.com and today we still have a holding of 17.64% in ADVFN plc.

Online Blockchain plc continues to consider new related opportunities, particularly crypto currencies and blockchain opportunities.

Principal risks and uncertainties

The management of the Company and the nature of the Company's strategy are subject to a number of risks. The directors have set out below the principal risks facing the business. The directors have adopted a thorough risk management process which involves the formal review of all the risks identified below. Where possible, processes are in place to monitor and mitigate such risks. 

Investment in our associate ADVFN Plc

The investment of approximately 17.64% in the associate ADVFN Plc results in a significant proportion of the revenue as well as the largest asset held by the company. The performance of this investment is of great importance and volatility in ADVFN Plc's markets and results may affect the income statement and balance sheet of the company.

Blockchain and crypto currency

It's an unpredictable and volatile market that can be illiquid in many cases apart from the major products such as Bitcoin. Whilst the situation has improved in the last 12 months, for the smaller crypto-currencies, the transfer between crypto-currency and fiat currencies can be complex and risky.

Economic volatility

Many things around the world can affect a stock market; the COVID-19 pandemic has had an enormous impact on the last year and will continue to do so into the foreseeable future. Brexit still has an impact on our day to day lives and together with the general economic situation, politics and other such conflicts, this makes it a volatile place to carry on our business. It is usually true that upheaval is beneficial for Online Blockchain as a result of our investment in ADVFN, as ADVFN's customers need to know what is happening to their investments using ADVFN as a tool for this. The success or failure of the world's stock markets will probably affect our business as a result given the sector within which ADVFN operates.

US Dollar and Euro exchange rates have recently been improving but still have the power to surprise in reaction to economic downturns. They continue to be affected by Brexit and that potential for volatility may well affect our business.

High proportion of fixed overheads

A large proportion of the Company's overheads are fixed and there is the risk that any significant changes in revenue may lead to the inability to cover such costs. We continue to closely monitor fixed overheads against budget on a monthly basis and cost saving exercises are implemented on a constant review basis.

Investment in Encryptid Gaming

Our investment in Encryptid Gaming Inc has not proved a success, the technical difficulties we encountered last year have proved insurmountable and so, as there is no ready market for the shares in this company, we have decided that the asset must be reduced to zero by means of a further impairment charge (2020: £18,000).

www.onlineblockchain.io  

STRATEGIC REPORT (continued)

Performance

The performance of the Company is closely linked to ADVFN plc. The Company supplies management services and makes advertising recharges to ADVFN which forms the turnover of the Company. As a result of this reliance the extract of the ADVFN accounts on page 5 will give necessary information and background on the factors affecting the performance of the Company. For the future we will look forward to our investments in Blockchain bearing fruit.

The following financial KPIs may prove helpful:

The very welcome improvement in ADVFN's performance in this financial year has brought the prospect of the first dividend.

The financial indicators are designed to offer a dashboard check of the significant measures of the company's operations. The change in focus in 2019 meant a short-term downturn in these Key Performance measures and the company bounced back from this in 2020. In the current year the dashboard shows turnover at £65,000 and the operating loss at £241,000. The company does not currently monitor non-financial KPI's and will do so when they can offer additional clarity to the financial performance measures.

Operating costs

Our costs remain reasonably fixed and predictable and we do not see that changing in the immediate future. They are firmly under control.

Research and development

We believe in trying to get the best from all areas that we work in. It is very important that Online Blockchain continues to invest in the quality and design of our products. We believe continued investment in our research and development is fundamental to the continuing growth of the business.

Environmental policy

This has always been important to the Company and as a whole we continue to look for ways to develop our environmental policy. We have a very small carbon footprint and try to reduce any waste we create; we are a small team working from home which makes this task easier. Most of our communications are electronic which again cuts our use of non-environmentally friendly products.

Future developments for the business

We continue to work with our investment in ADVFN and assist it with its growth as well. The continued growth and development of ADVFN in the medium term provides the incentive to go on concentrating on this business in the immediate future.

We are constantly examining  other investment opportunities as they present themselves and the Directors will continue to do this.

STRATEGIC REPORT (continued)

Directors' statement of responsibilities under section 172 Companies Act 2006

The Directors have considered the requirements of Section 172(1) of the Companies Act 2006 to prepare a statement explaining how the Directors have considered the wider stakeholder needs when performing their duties under Section 172 of the Companies Act 2006.

The Directors consider the stakeholders to be the people who work for us, work with us, invest with us, own us, regulate us and live in the societies we serve. The Directors recognise that building strong relationships with our stakeholders will help deliver the Company's strategy in line with the long-term values. The Directors are committed to effective engagement with all of our stakeholders and seek to understand the interests and views of the Company's stakeholders by engaging with them directly as appropriate.

Depending on the nature of the issue in question, the relevance of each stakeholder group may differ and, as such, as part of Company's engagement with stakeholders, the Directors seeks to understand the relative interests and priorities of each group and to have regard to these, as appropriate, in their decision making. The Directors acknowledge, however, that not every decision it makes will necessarily result in a positive outcome for all stakeholders. The directors also challenge management to ensure all stakeholder interests are considered in the day to day management and operations of the Company.

As part of their deliberations and decision making process, the Directors take into account the following:

• the likely consequences of any decisions in the long term;

• interests of the company's employees and consultants;

• need to foster the company's business relationships with suppliers, customers and others;

• impact of the company's operations on the community and environment;

• desirability of the company maintaining a reputation for high standards of business conduct; and

• need to act fairly as between members of the company.

As a result of these activities, the Directors believe that they have demonstrated compliance with their legal obligations under s.172 of the Companies Act 2006

Business

The Directors' aim for the Group be and remain a contributing and good "Corporate Citizen".

Our business does not have a high carbon footprint and we consider it a sustainable business. We try to ensure that our planet's precious resources are used appropriately for the benefit of current and future generations. The Board considers that the business and strategic decisions which it takes now, in furtherance of the Group's business objectives, do not damage the global environment.

Employees

The Group has a small number of employees and consultants but those it has are situated and are deployed on the Group's business around the World. We ensure that we comply with all local labour laws and apply what the Directors believe are appropriate standards and systems to monitor and to ensure the welfare of those employees.

Stakeholder engagement

The Company is entirely owned and controlled by the shareholders of Online Blockchain Plc and the shares of the company are traded on AIM. The stakeholders of the Company consist predominantly of the shareholders, employees, advisers and suppliers. The Directors recognise the importance of these relationships and take active steps to develop and strengthen them through dialogue and engagement. These relationships are regularly monitored at Board level. 

Governance

Each Board meeting addresses compliance by the Company with its corporate governance codes and reinforces the Board's requirement that its business be conducted with integrity and with due regard for ethical standards.

Approved and signed on behalf of the Board of Directors

Clement Chambers

CEO

30 November 2021

Consolidated income statement

There is no other comprehensive income for either the current or prior year.

Consolidated statement of changes in equity

1.      Basis of preparation

The consolidated and company financial statements are for the year ended 30 June 2021.  They have been prepared in compliance with International Financial Reporting Standards (IFRSs) and IFRS Interpretations Committee (IFRIC) interpretations as adopted by the European Union as at 30 June 2021. The consolidated and company financial statements have been prepared under the historical cost convention and are presented in Sterling rounded to the nearest thousand (£'000) except where indicated otherwise.

Going concern

The financial statements have been prepared on the going concern basis which assumes the Group will continue in existence for the foreseeable future. The Directors have prepared a detailed forecast of future trading, the Directors believe that this will gradually improve over the next 12 months. We have undertaken a significant fund raise during the year and this has provided us with the ability to continue our pursuit of new and potentially profitable projects. The Group cash balance at the year end is £1,497,000. In addition, to maintain liquidity, the Group has access to an overdraft facility amounting to £50,000 which has been utilised this year and, if necessary, the option is available to raise additional funds on the market or, ultimately, to sell shares in ADVFN Plc. Accordingly, the Directors have prepared these financial statements on the going concern basis.

Standards and amendments to existing standards adopted in these accounts

IAS 1 Presentation of Financial Statements and IAS 8 Accounting policies, Changes in Accounting Estimates and Errors (Amendment - Definition of Material)

Interest Rate Benchmark Reform - IBOR 'phase 2' (Amendments to IFRS 7)

IFRS 3 Business Combinations (Amendment - Definition of Business)

Revised Conceptual Framework for Financial Reporting

The standards and amendments adopted in these accounts had no material effect on the financial statements.

Standards, amendments and interpretations to existing standards that are not yet effective and have not been early adopted by the Company in the 30 June 2021 financial statements

Onerous Contracts - Cost of Fulfilling a Contract (Amendments to IAS 37)

Property Plant and Equipment: Proceeds before intended use. (Amendments to IAS 16)

Annual improvements to IFRS Standards 2018-2020

References to Conceptual Framework (Amendments to IFRS 3)

Classification of liabilities as Current or Non-current (Amendments to IAS 1)

IFRS 17 - Insurance Contracts

Amendments to IFRS 17 - Insurance Contracts; and Extension of the Temporary Exemption from Applying IFRS 9 (Amendments to IFRS 4 Insurance Contracts)

Disclosure of Accounting Policies (Amendments to IAS 1 Presentation of Financial Statements and IFRS Practice Statement 2 Making Materiality Judgements)

Definition of Accounting Estimates (Amendments to IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors)

Deferred Tax related to Assets and Liabilities arising from a Single Transaction (Amendments to IAS 12 Income Taxes)

COVID-19 Related Rent Concessions (Amendments to IFRS 16)

The Directors continue to monitor developments in the relevant accounting standards but do not believe that these changes will significantly impact the Group.

2.      Segmental analysis

The Directors identify operating segments based upon the information which is regularly reviewed by the chief operating decision maker. The Group considers that the chief operating decision makers are the executive members of the Board of Directors.

The Group has two reportable operating segments, being that of Faucet subscription and the provision of management services. The 'Other' segment includes the remaining income from mining and a small amount of advertising. Segment information can be analysed as follows for the reporting period under review:

For detail of the discontinued operations please see note 24.

Mining activity continued into the current year but had been put on hold by the 30 June 2021. The assets have been re-allocated to the management services segment and the income generated from mining during the current year is now shown under the 'Other' segment. There will be no further income from mining cryptocurrency.

During both 2021 and 2020 a related party accounted for more than 10% of the Group's total revenues.

3.             Earnings per share

Where a loss has been recorded for the year the diluted loss per share does not differ from the basic loss per share as the exercise of share options would have the effect of reducing the loss per share and is therefore not dilutive under the terms of IAS 33. Where a profit has been recorded but the average share price for the year remains under the exercise price the existence of options is likewise not dilutive.

4.             Issued share capital

Share placings

The share placings of Ordinary shares of 5 pence each were completed on 17 December 2020 and 7 January 2021 at 22 pence per share and 36.8 pence per share respectively. Total costs amounted to £53,000.

Share option exercises

The share options exercises were completed on 7 and the 18 January 2021 and 17 February 2021. The exercise prices were as follows:

7 January 2021- 100,000 at 22 pence per share and 238,636 at 32 pence per share

18 January 2021- 613,635 at 32 pence per share

17 February 2021- 100,000 at 36.8 pence per share, 56,820 at 32 pence per share and 4,698 at 40 pence per share

Share price

The market value of the Ordinary shares at 30 June 2021 was 38.00p (2020: 15.00p). The range during the year was 12.00p to 99.00p (2020: 7.00p to 22.00p). Shareholders are entitled to one vote per Ordinary share held and dividends will be apportioned and paid proportionately to the amounts paid up on the Ordinary shares held.

The Deferred Shares do not entitle the holders thereof to receive any dividend or other distribution nor to receive

notice of nor to attend nor vote at any General Meeting of the Company.  On a return of capital on a winding up the

holders of Deferred Shares are only entitled to receive the amount paid up on such shares after the holders of the

Ordinary Shares have received the sum of £100,000 for each Ordinary Share held by them and shall have no other

right to participate in the assets of the Company.

5.             Events after the balance sheet date

There were no significant events to report after the balance sheet date.

6.             Publication of Non-Statutory Accounts

The financial information set out in this preliminary announcement does not constitute statutory accounts as defined in section 435 of the Companies Act 2006.

The balance sheet at 30 June 2020 and the income statement, statement of changes in equity, the statement of cashflows and associated notes for the year then ended have been extracted from the Company's 2020 statutory financial statements upon which the auditors' opinion is unqualified and does not include any statement under Section 498(2) or (3) of the Companies Act 2006.

ENDS