Vox Valor Capital Limited
("Vox Valor" or the "Company")
Annual Results
Vox Valor (LSE: VOX), is pleased to announce its audited final results for the financial year ended 31 December 2022.
Period Highlights:
· For the financial year ended 31 December 2022, Vox Valor reported revenue of USD 13.8 million, versus USD 7.0m in the previous financial period, and a gross profit of USD 29k versus an operating loss of USD 336k in the previous financial period.
· Total comprehensive income for the year was a loss of USD 5.5m (versus a loss of USD 1.6m in the previous financial period), which is mainly caused by non-recurring expenditure and accounting write-offs and impairments in relation to the reverse take-over and the divestment of Mobile Marketing LLC.
· During the financial year that ended 31 December 2022, Vox Valor completed the acquisition of Vox Capital (including the Mobio Global mobile marketing group), which transaction constituted a reverse take-over transaction (the "RTO"), and Vox Valor ceased its business operations in Russia and divested its 100% shareholding in Mobile Marketing LLC (the Russian operating subsidiary of Mobio Global Limited) in August 2022. Both the RTO transaction and the divestment of Mobile Marketing LLC have resulted in non-recurring expenditure and certain non-cash impairments that had a significant impact on the financial results of the Company.
Post Period Highlights:
· The Company has entered into two non-binding term sheets in relation to the acquisition of two mobile game development and publishing businesses. These term sheets are non-binding, subject to final documentation and due diligence and subject to financing and board approval. The Company will make a further announcement once binding agreements have been entered into.
Commenting on the results John Booth, Chairman, said:
"On behalf of the entire board of directors I am pleased to announce the first results of Vox Valor as a publicly listed group. During 2022, we completed the reverse take-over transaction and divested Mobile Marketing LLC. The group has reported strong revenue growth and reached an operating profit. For the year ahead, we look forward to seeing Vox Valor grow further both organically and through mergers and acquisitions."
For additional information please contact:
John Booth (Chairman)
Konstantin Khomyakov (CFO)
Tel: +1 (345) 949-4544
Email: ir@voxvalor.com
Novum Securities Limited
David Coffman / George Duxberry
Tel: +44 (0)207 399 9400
About Vox Valor Capital Limited
Vox Valor Capital Limited is the holding company for Vox Capital Limited and its subsidiary companies (together the "Vox Group"). The Vox Group has a focus on making acquisitions of majority stakes in the marketing technology, digital content, mobile games/apps and digital marketing sector. Digital marketing technology and services and digital content/mobile games are large and fast-growing industries. The Vox Group's management team has a successful track record of operating, financing, and exiting businesses in this sector and has a network in this sector which generates a steady flow of leads and introductions to potential acquisition candidates. The Vox Group will target the acquisition of privately held businesses that can benefit from the access to liquidity and international scaling expertise that the Vox Group and its management team can provide.
Chairmans statement
Vox Valor Capital Limited is pleased to announce that its audited financial statements for the year ended 31 December 2022 have been published and are available on its website at www.voxvalor.com/investors.
We are very pleased to report a strong increase in revenues and the group achieving a modest operating profit. These results are very encouraging as this revenue growth and operating profit improvement has been achieved under very challenging circumstances as the operations of Vox Valor's mobile marketing unit Mobio Global were disrupted by Mobio Global ceasing its operations in Russia and the sale of Mobile Marketing LLC. For the current financial year, we are looking forward to growing Vox Valor both organically and through potential acquisitions.
Summary of Trading Results and Outlook
For the financial year ended 31 December 2022, Vox Valor reported revenue of USD 13.8 million (versus USD 7.0m in the previous financial period) and a gross profit of USD 29k (versus an operating loss of USD 336k in the previous financial period).
Total comprehensive income for the year was a loss of USD 5.5m (versus a loss of USD 1.6m in the previous financial period), which is mainly caused by non-recurring expenditure and accounting write-offs and impairments in relation to the reverse takeover ("RTO") and the divestment of Mobile Marketing LLC.
During the financial year that ended 31 December 2022, Vox Valor completed the acquisition of Vox Capital (including the Mobio Global mobile marketing group), which transaction constituted an reverse take-over transaction (the "RTO") under the Listing Rules., and Vox Valor ceased its business operations in Russia and divested its 100% shareholding in Mobile Marketing LLC (the Russian operating subsidiary of Mobio Global Limited) in August 2022. Both the RTO transaction and the divestment of Mobile Marketing LLC have resulted in non-recurring expenditure and certain non-cash impairments that had a significant impact on the financial results of the Company.
Financial Statements
Consolidated statement of profit or loss and other comprehensive income
for the year ended 31 December 2022
| Notes |
| 31 December 2022 |
| 30 September 2021 |
Operating income and expenses | | | | | |
Sales revenue | 1 | | 13,829,357 | | 6,965,362 |
Total income | | | 13,829,357 |
| 6,965,362 |
| | | | | |
Operating expenses | 2 | | (12,585,236) | | (6,252,373) |
Administrative expenses | 4 | | (670,594) | | (655,901) |
Contractors fees | | | (346,514) | | (281,838) |
Right-of-use assets expenses | | | (38,290) | | (50,226) |
Depreciation of tangible/intangible assets | | | (23,664) | | (32,347) |
Professional services | | | (67,873) | | (12,716) |
Audit and accountancy fees | | | (68,142) | | (10,299) |
Marketing expenses | | | - | | (4,851) |
Other expenses | | | - | | (464) |
Total operating costs | | | (13,800,313) | | (7,301,015) |
| | | | | |
OPERATING PROFIT / (LOSS) | |
| 29,044 |
| (335,653) |
| | | | | |
Non-operational income and expenses | | | | | |
Non-operating income | 7 | | 70,989 | | 64,424 |
Non-operating expenses | 7 |
| (8,387) | | (1,982,294) |
RTO Expenses | 5 |
| (2,723,648) | | - |
NET NON-OPERATING RESULT | |
| (2,661,046) | | (1,917,970) |
| | | | | |
Financial income and expenses | | | | | |
Interest income / (expenses) | 8 | | (490,194) | | (215,235) |
Convertible note interest accruals | | | - | | (5,569) |
Financial income / (expenses) | 6 | | (73,394) | | 22,816 |
NET FINANCIAL RESULT | |
| (563,588) |
| (197,988) |
| | | | | |
PROFIT / (LOSS) BEFORE TAX | |
| (3,195,590) |
| (2,451,511) |
| | | | | |
Profit tax | | | (15,492) | | (36,488) |
Deferred taxes | 9 | | 65,312 | | 29,891 |
PROFIT / (LOSS) FOR THE PERIOD | |
| (3,145,770) |
| (2,458,108) |
| | | | | |
OTHER COMPREHENSIVE INCOME | | | | | |
Revaluation reserve | | | (393) | | 854,196 |
Transactions with owners (business restructuring) | 10 | | (1,509,883) | | - |
Exchange differences on translating foreign operations | 30 | | 222,601 | | (222,601) |
Translation difference | | | (1,077,074) | | 203,721 |
OTHER COMPREHENSIVE INCOME | |
| (2,364,749) |
| 835,709 |
| |
|
|
|
|
TOTAL COMPREHENSIVE INCOME / (LOSS) FOR THE PERIOD | |
| (5,510,519) |
| (1,622,399) |
| |
|
|
|
|
Basic and diluted loss per share | 11 |
| (0.14) |
| (0.12) |
Consolidated statement of financial position as at 31 December 2022
|
| Notes |
| 31 December 2022 |
| 30 September 2021 |
ASSETS |
| | | | | |
Non-current assets |
| | | | | |
Investments | | 16 | | 10,156,381 | | 11,770,347 |
Goodwill | | 12 | | - | | 1,923,299 |
Right-of-use assets | | 15 | | 66,156 | | 118,867 |
Deferred tax assets | | 9 | | 58,162 | | 42,174 |
Tangible fixed assets | | 13 | | 3,391 | | 21,568 |
Intangible assets | | 14 | | 7,038 | | 7,176 |
Other long-term financial assets | | | | - | | 2,684 |
Total non-current assets |
|
|
| 10,291,128 |
| 13,886,115 |
| | | | | | |
Current assets |
| | | | | |
Trade and other receivables | | 17 | | 2,930,095 | | 1,743,871 |
Cash at bank | | 18 | | 911,686 | | 756,159 |
Inventories | | | | - | | 33 |
Other short-term assets | | 19 | | 3,516 | | 136,176 |
Total current assets |
|
|
| 3,845,297 |
| 2,636,239 |
TOTAL ASSETS |
|
|
| 14,136,425 |
| 16,522,354 |
| | | | | | |
EQUITY AND LIABILITIES |
| | | | | |
| | | | | | |
EQUITY |
| | | | | |
Share Capital | | 28 | | 194,426 | | 187,128 |
Share premium | | 28 | | 13,660,572 | | 12,705,270 |
Share based payments | | | | 1,926,720 | | - |
Revaluation reserve | | | | 854,196 | | 854,196 |
Convertible notes reserve | | | | - | | 393 |
Retained earnings | | | | (6,944,622) | | (2,288,969) |
Exchange differences on translating foreign operations | | 30 | | - | | (222,601) |
Translation difference | | | | (873,353) | | 436,473 |
TOTAL EQUITY |
|
|
| 8,817,939 |
| 11,671,890 |
| | | | | | |
LIABILITIES |
| | | | | |
Non-current liabilities |
| | | | | |
Contingent consideration | | | | - | | 1,307,503 |
Loans (long term) | | 21 | | 2,055,712 | | 1,000,000 |
Convertible notes | | | | - | | 202,434 |
Other long-term liabilities | | 23 | | 53,722 | | 77,658 |
Total non-current liabilities |
|
|
| 2,109,434 |
| 2,587,595 |
| | | | | | |
Current liabilities |
| | | | | |
Trade and other payables | | 20 | | 2,905,091 | | 1,965,047 |
Loans (short term) | | 21 | | 81,608 | | 22,565 |
Accrued expenses | | | | 34,235 | | 10,656 |
Current tax liabilities | | | | 17,823 | | 13,762 |
Other short-term liabilities | | 23, 24 | | 170,295 | | 250,839 |
Total current liabilities |
|
|
| 3,209,052 |
| 2,262,869 |
| | | | | | |
TOTAL LIABILITIES |
|
|
| 5,318,486 |
| 4,850,464 |
TOTAL EQUITY AND LIABILITIES |
|
|
| 14,136,425 |
| 16,522,354 |
Consolidated statement of changes in equity for the year ended 31 December 2022
| Share Capital | Share premium | Share based payments | Revaluation reserve | Convertible notes reserve | Retained earnings | Exchange differences on translating foreign operations | Translation difference | Total equity |
Balance at 30 September 2021 | 187,128 | 12,705,270 | - | 854,196 | 393 | (2,288,969) | (222,601) | 436,473 | 11,671,890 |
Transactions with owners | 7,298 | 955,301 | 1,926,720 | - | - | - | - | - | 2,889,319 |
Results from activities | - | - | - | - | - | (3,145,770) | - | - | (3,145,770) |
Other comprehensive income | - | - | - | - | (393) | (1,509,883) | 222,601 | (1,309,825) | (2,597,500) |
Balance at 31 December 2022 | 194,426 | 13,660,572 | 1,926,720 | 854,196 | - | (6,944,622) | - | (873,353) | 8,817,939 |
| Share Capital | Share premium | Revaluation reserve | Convertible notes reserve | Retained earnings | Exchange differences on translating foreign operations | Translation difference | Total equity |
Balance at 30 September 2020 | 64,621 | - | - | - | 169,139 | - | - | 233,760 |
Transactions with owners | 122,507 | 12,938,022 | - | - | - | - | - | 13,060,529 |
Results from activities | - | - | - | - | (2,458,108) | - | - | (2,458,108) |
Other comprehensive income | - | - | 854,196 | 393 | - | (222,601) | 203,721 | 835,109 |
Balance at 30 September 2021 | 187,128 | 12,938,022 | 854,196 | 393 | (2,288,969) | (222,601) | 203,721 | 11,671,890 |
Consolidated statement of cash flows for the year ended 31 December 2022
| Notes | | 31 December 2022 |
| 30 September 2021 |
OPERATING ACTIVITIES |
| | | | |
Profit / (loss) before taxation | | | (3,195,590) | | (2,451,511) |
Adjustments for |
| | | | |
Depreciation of tangible/intangible fixed assets | | | 23,664 | | 32,347 |
Depreciation of right-of-use assets | | | 38,290 | | 50,226 |
Interest not paid (received) | | | 51,562 | | 22,565 |
Inventories | | | 33 | | (33) |
Trade and other receivables | | | (1,186,224) | | (1,685,844) |
Trade and other payables | | | 940,044 | | 1,948,671 |
Other assets | | | 132,660 | | (138,860) |
Other liabilities | | | (24,284) | | 328,500 |
Accrued expenses | | | 23,579 | | 10,656 |
Accrued interest | | | - | | 5,570 |
Tax accruals | | | - | | 13,762 |
Non-operating expenses | | | 3,148,046 | | 1,938,096 |
Cash generated from operations |
| | (48,220) |
| 74,145 |
| | | | | |
Taxes reclaimed (paid) | | | - | | - |
Total cash flow from operating activities |
| | (48,220) |
| 74,145 |
| | | | | |
INVESTMENT ACTIVITIES |
| | | | |
Purchase /disposal of property, plant and equipment | | | (3,391) | | (16,773) |
Purchase /disposal of other intangible assets | | | (15,276) | | (8,652) |
Acquisition of subsidiaries, net of cash acquired | | | (291,747) | | (319,836) |
Total cash flow from investment activities |
| | (310,414) |
| (345,261) |
| | | | | |
FINANCING ACTIVITIES |
| | | | |
Capital increase | | | - | | 122,507 |
Loans given / received | | | 625,000 | | 1,000,000 |
Financial obligations (right-of-use) | | | (71,103) | | (64,553) |
Interest paid (right-of-use) | | | (5,032) | | (8,853) |
Convertible notes | | | - | | 194,340 |
Total cash flow from financing activities |
| | 548,865 |
| 1,243,441 |
| | | | | |
NET CASH FLOW |
|
| 190,231 |
| 972,325 |
| | | | | |
Exchange differences and translation differences on funds | | | (34,704) | | (216,297) |
MOVEMENTS IN CASH FUND |
| | 155,527 |
| 756,028 |
| | | | | |
Balance as of beginning of the period | | | 756,159 |
| 131 |
Movement for the period | | | 155,527 | | 756,028 |
Balance as of the end | | | 911,686 |
| 756,159 |
Notes to the consolidated financial statements, comprising significant accounting policies and other explanatory information for the year ended 31 December 2022
GENERAL INFORMATION
Vox Valor Capital LTD (the "Company").
Vox Valor Capital LTD (former Vertu Capital Limited) was incorporated in the Cayman Islands on 12 September 2014 as an exempted company with limited liability under the Companies Law. The Company's registered office is Forbes Hare Trust Company Limited, Cassia Court, Camana Bay, Suite 716, 10 Market Street, Grand Cayman KY1-9006, Cayman Islands, registration number 291725.
The Group comprises from the parent company Vox Valor Capital LTD and the following subsidiaries:
· Vertu Capital Holding Ltd United Kingdom 100% ownership by Vox Valor Capital LTD
· Vox Capital Ltd United Kingdom 100% ownership by Vox Valor Capital LTD
· Vox Valor Capital Pte Limited Singapore 100% ownership by Vox Capital Ltd
· Initium HK Limited Hong Kong 100% ownership by Vox Capital Ltd
· Mobio Global Limited United Kingdom 100% ownership by Vox Capital Ltd
· Mobio (Singapore) Pte Ltd Singapore 100% ownership by Mobio Global Limited
· Mobio Global Inc . USA 100% ownership by Mobio Global Limited
The principal activity of the Group is businesses in the digital marketing, advertising and content sector. The Group focuses on App, Mobile, Performance and has been providing the services for the promotion of mobile apps and games.
The Company is controlled by Vox Valor Holding LTD (UK).
Final beneficiaries of the Group are: Pieter van der Pijl, Stefans Keiss, and Sergey Konovalov.
Management (Directors)
· John G Booth (Chairman and Non-Executive Director)
· Rumit Shah (Non-Executive Director)
· Simon Retter (Non-Executive Director)
· Konstantin Khomyakov (Finance Director)
Going concern
At the time of approving the financial statements, the Management has a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. Thus, the Management continues to adopt the going concern basis of accounting in preparing the financial statements.
ACCOUNTING POLICIES
The Consolidated Financial Statements have been prepared in accordance with UK-adopted International Accounting Standards ("IFRS") and interpretations issued by the International Accounting Standards Board ("IASB") and interpretations issued by the International Financial Reporting Standards Interpretations Committee ("IFRIC").
The presentational currency of the Group is US dollars (USD).
The notes are an integral part of the financial statements.
Reporting period
These financial statements are presented as a continuation of the financial statements of Vox Capital Ltd.
These financial statements represent the financial reporting period of the Group from 30 September 2021 till 31 December 2022. The end of the reporting period of Vox Capital Ltd has been changed from 30 September to 31 December.
The Group has consolidated financial information of Vox Capital Ltd for the period from 30 September 2021 till 31 December 2022 (15 months) and subsidiaries for the period from 1 January to 31 December. Due to disposal of the investment in Mobile Marketing LLC on August 2, 2022, income and expenses of Mobile Marketing LLC for 7 months of 2022 are taken into account in the consolidated financial statements.
General
An asset is disclosed in the statement of financial position when it is probable that the expected future economic benefits attributable to the asset will flow to the entity and the cost of the asset can be reliably measured. A liability is disclosed in the statement of financial position when it is expected to result in an outflow from the entity of resources embodying economic benefits and the amount of the obligations can be measured with sufficient reliability.
If a transaction results in transfer of future economic benefits and/or when all risks associated with assets or liabilities have been transferred to a third party, the asset or liability is no longer included in the statement of financial position. Assets and liabilities are not included in the statement of financial position if economic benefits are not probable or cannot be measured with sufficient reliability.
The income and expenses are accounted for during the period to which they relate. Revenue is recognized when control over service is transferred to a customer.
The Management is required to form an opinion and make estimates and assumptions for assets, liabilities, income, and expenses. The actual result may differ from these estimates. The estimates and the underlying assumptions are constantly assessed. Revisions are recognised during a corresponding revision period as well as any future periods affected by the revision. The nature of these estimates and judgements, including related assumptions, is disclosed in the notes to corresponding items in the financial statement.
Basis of consolidation
On 30 June 2021 the Company announced its intention to acquire Vox Capital Ltd, the parent company that wholly owns a mobile marketing agency, Mobio Global, and has shareholdings in an influencer marketing automation platform and a mobile app monetisation platform. The Acquisition is constituted a Reverse Takeover (RTO) under the Listing Rules as the value of the consideration exceed the Company's market capitalisation and it result in a fundamental change in the business of the Company as it will own an operating business. On 30 September 2022, the Company entered into a sale and purchase agreement with the Vox Sellers.
Consolidated financial statements reflect the substance of the transaction. The substance of the transaction is Vox Capital Ltd, the accounting acquirer (operating company) has made a share-based payment to acquire a listing along with the listed company's cash balances and other net assets. The transaction is therefore accounted for in accordance with IFRS 2.
Vox Valor Capital LTD, the listed company still becomes a legal parent and continues to have filing obligations. As required by IFRS 10 'Consolidated Financial Statements' the legal parent has to prepare consolidated financial statements. Based on the IFRIC agenda decision, these consolidated financial statements are prepared using some of the guidance in IFRS 3 on reverse acquisition, but without recognizing goodwill. Therefore:
· the consolidated financial statements of Vox Valor Capital LTD, the legal parent (listed shell company) are presented as a continuation of the financial statements of Vox, the operating company (the legal subsidiary, which is considered the accounting acquirer),
· the transaction price is allocated to the identifiable assets and liabilities of the listed shell company on the basis of their fair values at the date of purchase,
· any excess of the transaction price over the fair value of the assets and liabilities of the listed shell company represents a cost for obtaining a listing. This is accounted for as an expense as it does not represent an asset under IFRS,
· no goodwill is recognized.
The Consolidated Financial Statements incorporate the financial information of Vox Capital Ltd and all its subsidiary undertakings. Subsidiary undertakings include entities over which the Group has effective control. The Company controls a group when it is exposed to, or has right to, variable returns from its involvement with the Group and has the ability to affect those returns through its power over the Group. In assessing control, the Group takes into consideration potential voting rights.
· The Company acquired Vox Valor Capital LTD on 30 September (holding company)
· The Company acquired Vertu Capital Holding Ltd on 30 September (holding company)
· The Company acquired Vox Valor Capital Singapore Pte Limited on 8 October 2020 (holding company)
· The Company acquired Initium HK Limited on 14 December 2020 (holding company)
· The Company acquired Mobio (Singapore) PTE LTD on 14 October 2020.
· The Company acquired Mobile Marketing, LLC on 14 October 2020 and sold on 2 August 2022
· The Company acquired Mobio Global Inc. on 27 April 2022
Principles for foreign currency translation
The financial statements of the Group are presented in US dollars, which is the Group's presentation currency.
Receivables, liabilities, and obligations denominated in any currency other than USD are translated at the exchange rates prevailing as of the reporting date.
Transactions in any currency other than USD during the financial year are recognized in the financial statements at the average annual exchange rate. The exchange differences resulting from the translation as of the reporting date, taking into account possible hedging transactions, are recorded in the consolidated statement of profit or loss and other comprehensive income.
The nominal value of the share capital and other share components of the subsidiaries are denominated in Singapore dollars (SGD) and in the pounds of sterling (GBP) and translated into USD using historical exchange rate; the exchange differences resulting from this translation are recorded in the Exchange differences on translating foreign operations in the statement of financial position.
Cross-rates USD/RUB are taken from the Central bank of the Russian Federation official site Official exchange rates on selected date | Bank of Russia (cbr.ru). Cross-rates GBP/USD, USD/SGD and average rate GBP/USD are taken from https://www.exchangerates.org.uk/ and closing rate GBP/USD is taken from the site Currency Exchange Rates - International Money Transfer | Xe.com.
GBP/USD |
| 31.12.2022 |
| 30.09.2021 |
Closing rate | | 1.2101 | | 1.3468 |
Average rate | | 1.2369 | | 1.3727 |
Revenue
The Group's revenue comprises primary income from the provision of mobile marketing services in 2022 and 2021. Revenue is recognized when the related services are delivered based on the specific terms of the contract. The Group uses a number of different information technology ("IT") systems to track certain actions as specified in customer contracts. The calculation of charges for mobile marketing services is carried out automatically by the technology platform based on pre-defined key parameters, including unit price and volume. These IT systems are complex and process large volumes of data.
Records of mobile marketing services charges are generated in an aggregated amount for each category and are manually entered into the accounting system on a monthly basis.
Revenue recognition
Revenue is measured based on specific contract terms and excludes amounts collected on behalf of any third parties. Revenue is recognized when control over service is transferred to a customer.
The following is a description of principal activities from which the Group generates its revenue.
Revenue from mobile advertising services
Revenue from mobile marketing services primarily includes the income generated as a result of providing mobile marketing services by the Group. The Group utilizes a combination of pricing models and revenue is recognized when the related services are delivered based on specific contract terms, which are commonly based on:
a) specified actions (i.e., cost per action ("CPA") or other preferences agreed with advertisers), or
b) agreed rebates to be earned from certain publishers.
Specified actions
Revenue is recognized on a CPA basis once agreed actions (download, activation, registration, etc.) are performed. Individually, none of the factors can considered presumptive or determinative, because the Group is the primary obligor responsible for (1) identifying and contracting third-party advertisers considered as customers by the Group; (2) identifying mobile publishers to provide mobile spaces where mobile publishers are considered as suppliers; (3) establishing prices under the CPA model; (4) performing all billing and collection activities, including retaining credit risk; and (5) bearing sole responsibility for the fulfillment of advertising services, the Group acts as the principal of these arrangements and therefore recognizes the revenue earned and costs incurred related to these transactions on a gross basis.
Principal versus agent considerations - revenue from provision of mobile marketing services
Determining whether the Group is acting as a principal or as an agent in the provision of mobile marketing services requires judgements and considerations of all relevant facts and circumstances. The Group is a principal to a transaction if the Group obtains control over the services before they are transferred to customers. If the level of control cannot be determined, if the Group is primarily obligated in a transaction, has latitude to establish prices and select publishers, or several but not all of these factors are present, the Group records revenues on a gross basis. Otherwise, the Group records the net amount earned as commissions from services provided.
Segment reporting
In a manner consistent with the way in which information is reported internally to the Management (chief operating decision maker) for the purpose of resource allocation and performance assessment, the Group has one reportable segment, which is Mobile marketing business.
Mobile marketing business: this segment delivers mobile advertising services to customers globally through a Software-as-a-Service ("SaaS") programmatic advertising platform, top media and affiliate ad-serving platform.
No segment assets and liabilities information are provided as no such information is regularly provided to the Management for the purpose of decision-making, resources allocation, and performance assessment.
Revenue may be disaggregated by timing of revenue recognition:
- Point in time, and
- Over time.
Notes #1 specifies information about the geographical location of the Group's revenue from external customers. The geographical location of customers is based on the location of the customers' headquarters.
Cost of sales (operating expenses)
Cost of sales represents the direct expenses that are attributable to the services delivered. They consist primarily of payments to platforms and publishers under the terms of the revenue agreements. The cost of sales can include commissions where applicable.
Financial instruments
The Group classifies financial instruments, or their component parts, on initial recognition as a financial asset, a financial liability, or an equity instrument in accordance with the terms of the contractual arrangement. Financial instruments are recognised on trade date when the Group becomes a party to the contractual provisions of the instrument. Financial instruments are recognised initially at fair value plus, in the case of a financial instrument not at fair value through profit and loss, transaction costs that are directly attributable to the acquisition or issue of the financial instrument. Financial instruments are derecognised on the trade date when the Group is no longer a party to the contractual provisions of the instrument.
Trade and other receivables and trade and other payables
Trade and other receivables are recognised initially at transaction price less attributable transaction costs. Trade and other payables are recognised initially at transaction price plus attributable transaction costs. Subsequent to initial recognition they are measured at amortised cost using the effective interest method, less any expected credit losses in the case of trade receivables. If the arrangement constitutes a financing transaction, for example if payment is deferred beyond normal business terms, then it is measured at the present value of future payments discounted at a market rate of interest for a similar debt instrument.
Interest-bearing borrowings
Interest-bearing borrowings are recognised initially at the present value of future payments discounted at a market rate of interest. Subsequent to initial recognition, interest-bearing borrowings are stated at amortised costs using the effective interest method, less any impairment losses.
Other financial commitments
Financial commitments that are not held for trading purpose are carried at amortised cost using the effective interest rate method.
Goodwill and Other Purchased Intangibles
Goodwill, representing the excess of purchase price and acquisition costs over the fair value of net assets of businesses acquired, and other purchased intangibles.
The Group annually reviews the recoverability of all long-term assets, whenever events or changes in circumstances indicate that the carrying amount of an asset might not be recoverable. The Group determines whether there has been an impairment by comparing the anticipated discounted future net cash flows to the related asset's carrying value. If an asset is considered impaired, the asset is written down to fair value which is either determined based on discounted cash flows or appraised values, depending on the nature of the asset.
Other purchased intangibles assessment
The Group annually reviews the recoverability of all long-term assets, whenever events or changes in circumstances indicate that the carrying amount of an asset might not be recoverable. The Group determines whether there has been an impairment by comparing the anticipated undiscounted future net cash flows to the related asset's carrying value. If an asset is considered impaired, the asset is written down to fair value which is either determined based on discounted cash flows or appraised values, depending on the nature of the asset.
Intangible fixed assets
Concessions, Intellectual Property and Licenses are stated at cost less accumulated amortisation.
Amortisation is recognized in the income statements on a straight-line over the estimated useful life as follows:
· Trademarks - 10 years.
· Licenses - validity period.
· Programs - 5 years.
Tangible fixed assets
Tangible fixed assets are stated at their historical cost less accumulated depreciation. Depreciation is recognized in the income statement in a straight-line basis over the estimated useful lives of each item of tangible fixed assets. The minimum cost to recognize an objects as a fixed asset is 3,000 USD. The annual depreciation rates applied are:
· Technical and office equipment, computers - 3 years.
Leases
All leases are accounted for by recognising a right-of-use asset and a lease liability except for:
· Leases of low value assets; and
· Leases with a duration of twelve months or less.
Lease liabilities are measured at the present value of contractual payments due to the lessor over the lease term, with the discount rate determined by reference to the rate inherent in the lease unless (as is typically the case) this is not readily determinable, in which case the Group's incremental borrowing rate placed at the official site of the Bank of England.
Variable lease payments are only included in the measurement of the lease liability if they depend on an index or on market rate. In such cases, the initial measurement of the lease liability assumes the variable element will remain unchanged throughout the lease term. Other variable lease payments are expensed in the period to which they relate.
Right-of-use assets are initially measured at the amount of lease liability, reduced for any lease incentives received, and increased for:
· Lease payments made at or before commencement of the lease.
· Initial direct costs incurred; and
· The amount of any provision recognised where the Group is contractually required to dismantle, remove, or restore the leased asset (typically leasehold dilapidations).
Subsequent to initial measurement lease liabilities increase as a result of interest charged at a constant rate on the balance outstanding and are reduced for lease payments made. Right-of-use assets are amortised on a straight-line basis over the remaining term of the lease or over the remaining economic life of the asset if, rarely, this is judged to be shorter than the lease term. When the Group revises its estimate of the term of any lease (because, for example, it re-assesses the probability of a lessee extension or termination option being exercised), it adjusts the carrying amount of the lease liability to reflect the payments to be made over the revised term, which are discounted at the same discount rate that applied on lease commencement. The carrying value of lease liabilities is similarly revised when the variable element of future lease payments dependent on a rate or index is revised. In both cases an equivalent adjustment is made to the carrying value of the right-of-use asset, with the revised carrying amount being amortised over the remaining (revised) lease term.
Short-term leases and leases of low-value assets
The Group has elected not to recognise right-of-use assets and lease liabilities for short-term leases that have a lease term of 12 months or less and low-value assets, including IT equipment. The Group would recognise the lease payments associated with these leases as an expense on a straight-line basis over the lease term.
Receivables
Upon initial recognition the receivables are included at fair value and then valued at amortised cost. The fair value and amortised cost equal the face value. Any provision for doubtful accounts deemed necessary is deducted. These provisions are determined by individual assessment of the receivables. All receivables are due within one year.
Cash
Cash and cash equivalents comprise cash balances and call deposits. Bank overdrafts that are repayable on demand and form an integral part of the Group's cash management are included as a component of cash and cash equivalents for the purpose only on the cash flow statement.
The cash flow statement from operating activities is reported using the indirect method.
Provisions
These are recognised when the Group has a present legal or constructive obligation as a result of past events, when it is probable that an outflow of resources will be required to settle the obligation, and the amount can be reliably estimated.
Provisions are measured at the present value of the expenditure expected to be required to settle the obligation, using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the obligation. The increase in the provision due to the passage of time is recognised as a finance cost.
Deferred taxes
A deferred tax liability / asset is recognized for any differences in commercial and fiscal valuation of the Group's assets and liabilities.
Taxation
Current tax is the tax currently payable based on the taxable profit for the year.
The Group recognises current tax assets and liabilities of entities in different jurisdictions separately as there is no legal right of offset. Deferred tax is provided in full on temporary differences between the carrying amounts of assets and liabilities and their tax bases, except when, at the initial recognition of the asset or liability, there is no effect on accounting or taxable profit or loss under a business combination. Deferred tax is determined using tax rates and laws that have been substantially enacted by the statement of financial position date, and that are expected to apply when the temporary difference reverses.
Tax losses available to be carried forward, and other tax credits to the Group, are recognised as deferred tax assets, to the extent that it is probable that there will be future taxable profits against which the temporary differences can be utilised. Changes in deferred tax assets or liabilities are recognised as a component of the tax expense in the statement of comprehensive income, except where they relate to items that are charged or credited directly to equity, in which case the related deferred tax is also charged or credited directly to equity.
Inventories
Inventories are stated at the lower of cost and net realizable value. Net realizable value is the estimated selling price in the ordinary course of business, less applicable variable selling expenses. Cost of inventory is determined on the weighted average cost basis.
Financial income and expenses
Financing income includes forex exchange and financial expenses include bank fee.
Possible impact of amendments, new standards and interpretations issued but not yet effective for the accounting period beginning on 31 December 2022
Up to date of issue of the financial statements, the IASB has issued a number of amendments and new standards, IFRS 17, Insurance contracts, which are not yet effective for the year ended 31 December 2022 and which have not been adopted in these financial statements.
These developments include the following which may be relevant to the Company (effective for accounting periods beginning on or after 1 January 2022):
- Amendments to IFRS 3, Reference to the Conceptual Framework
- Amendments to IFRS 4, Insurance costs
- Amendments to IFRS 16, Leases
- Amendments to IAS 1, Presentation of Financial Statements
- Amendments to IAS 8, Accounting Policies, Changes in Accounting Estimates and Errors
- Amendments to IAS 12, Income taxes
- Amendments to IAS 16, Property, Plant and Equipment: Proceeds before Intended Use
- Amendments to IAS 37, Onerous Contracts - Cost of Fulfilling a Contract
- Annual Improvements to IFRSs 2018-2020 Cycle 1.
The Company is in the process of making an assessment of what the impact of these amendments, new standards and interpretations is expected to be in the period of initial application. So far it has concluded that the adoption of them is unlikely to have a significant impact on the financial statements.
ACCOUNTS BREAKDOWN AND NOTES
1. Revenue
Revenue arises from:
Country |
| 31 December 2022 |
| 30 September 2021 |
|
UK | | 9,817,001 | | 167,520 |
|
Russian Federation* | | 3,711,116 | | 6,539,087 |
|
Singapore | | 297,932 | | 258,755 |
|
USA | | 3,308 | | - |
|
Total |
| 13,829,357 |
| 6,965,362 | |
Revenue is segmented by the country where it was received.
(*) Reflected the revenue received in the Russian Federation for the period from January 1 to August 2, 2022 (date of disposal of Mobile Marketing LLC).
2. Operating expenses
Country |
| 31 December 2022 |
| 30 September 2021 |
UK | | 9,336,308 | | 1,545,175 |
Russian Federation* | | 2,424,584 | | 4,695,363 |
Singapore | | 815,484 | | 11,835 |
USA | | 8,860 | | - |
Total |
| 12,585,236 |
| 6,252,373 |
Expenses |
| 31 December 2022 |
| 30 September 2021 |
Platforms and publishers' fees | | 10,976,611 | | 5,615,118 |
Premium receivable from platforms | | (82,439) | | (230,797) |
Contractor fees | | 1,327,870 | | 366,483 |
Salary | | 306,220 | | 398,864 |
Insurance contributions | | 50,806 | | 66,282 |
Other | | 6,168 | | 36,423 |
Total |
| 12,585,236 |
| 6,252,373 |
Operating expenses include the cost of the services of third parties for the placement of advertising and information materials of the Group's clients and the salaries expenses and social contributions of employees.
(*) Reflected the amount of operating expenses incurred in the Russian Federation for the period from January 1 to August 2, 2022 (date of disposal of Mobile Marketing LLC).
3. Operating segments
The operating segments identifies based on internal reporting for decision-making. The Group is operated as one business with key decisions irrespective of the geography where work for clients is carried out. The Management (chief operating decision maker) considers that the Group has one operating segment. Therefore, no additional disclosure has been represented.
Geographical disclosures are presented in the notes 1,2.
4. Administrative expenses
| 31 December 2022 |
| 30 September 2021 |
Salary | 184,052 |
| 195,551 |
Insurance contributions | 30,619 |
| 20,558 |
Directors' remuneration | 236,637 |
| 139,851 |
IT services and license fees | 94,283 |
| 45,016 |
Audit and accounting fees | 68,064 |
| 76,542 |
Business travel expenses | 12,690 |
| 8,478 |
Material costs | 5,879 |
| 10,084 |
Recruitment costs | 3,602 | | 66,995 |
Staff education and training | 2,497 | | 45,928 |
Other administrative expenses | 32,271 | | 46,898 |
Total | 670,594 |
| 655,901 |
Staff details (administrative and operating)
Number of staff |
| 31 December 2022 |
| 30 September 2021 |
UK | | 2 | | 2 |
including Director |
| 2 |
| 2 |
Russian Federation | | - | | 34 |
including Director |
| - |
| 1 |
Singapore |
| - |
| - |
USA |
| 4 |
| - |
including Director | | 1 | | - |
Total |
| 6 |
| 36 |
Staff cost (operating and administrative) |
|
31 December 2022 |
|
30 September 2021 |
Salary | | 490,272 | | 195,551 |
Directors' Remuneration | | 236,637 | | 139,851 |
Insurance contributions | | 81,425 | | 20,558 |
Total |
| 808,334 |
| 355,960 |
Current year audit fees USD 44,804 (equivalent of £40k), comparative USD 32,323 (equivalent of £24k).
Prior to their appointment as auditors for the year ended 31 December 2021 the auditors provided non-audit services as Reporting Accountants. USD 121,212 (equivalent of £90k) was charged in year ended 31 December 2022 following the completion of the RTO on September 2022.
5. Reverse acquisition (RTO)
| 31 December 2022 |
Acquisition of Vox Capital Ltd (note 29) | 1,856,898 |
Consulting fees | 866,750 |
Total | 2,723,648 |
6. Finance income and financial expenses
| 31 December 2022 |
| 30 September 2021 |
Finance income |
|
|
|
FX differences | - | | 41,808 |
Total | - |
| 41,808 |
|
|
|
|
Finance expenses |
|
|
|
FX differences | 60,552 | | 684 |
Bank fee | 12,842 | | 18,308 |
Total | 73,394 |
| 18,992 |
7. Non-operating income and expenses
| 31 December 2022 |
| 30 September 2021 |
Non-operating income |
|
|
|
Accounts payable writing-off | - | | 60,503 |
Provision for bad debts | 67,767 | | - |
Other non-operating income | 3,222 | | 3,921 |
Total | 70,989 |
| 64,424 |
|
|
|
|
Non-operating expenses |
|
|
|
Goodwill impairment | - | | 1,948,096 |
Provision for bad debts | 6,702 | | 30,208 |
Other non-operating expenses | 1,685 | | 3,990 |
Total | 8,387 |
| 1,982,294 |
8. Interest income and expenses
| 31 December 2022 |
| 30 September 2021 |
Interest income |
|
|
|
Interest on the bank account | 139 | | 4,818 |
Influence LLC, loan agreement 4 dd 19.08.2020 | 133 | | 210 |
Interest income total | 272 |
| 5,028 |
|
|
|
|
Interest expenses | 31 December 2022 |
| 30 September 2021 |
TDFD loan interest | 303,711 | | 211,410 |
Loan Note Interest Expense | 172,440 | | - |
AdTech loan | 7,179 | | - |
Mobile Marketing LLC | 2,104 | | - |
Rent interest | 5,032 | | 8,853 |
Total | 490,466 | | 220,263 |
9. Taxation
| 31 December 2022 |
| 30 September 2021 |
Profit tax |
|
|
|
UK corporation tax (19%)* | 12,584 | | (13,998) |
Russian corporation tax (20%) | (10,253) | | (22,490) |
Singapore corporation tax (17%) | (17,823) | | - |
USA corporation tax (21%) | - | | - |
Total current tax | (15,492) |
| (36,488) |
|
|
|
|
Deferred tax UK | 33,520 | | 10,787 |
Deferred tax Russia | 9,866 | | 19,104 |
Deferred tax Singapore | 866 | | - |
Deferred tax USA | 21,090 | | - |
Deferred tax in Profit and Loss report | 65,312 |
| 29,891 |
| | | |
Taxation on profit on ordinary activities | 49,820 | | (6,597) |
| | | |
Deferred tax in Statement of financial position - opening balance | 42,174 | | 12,761 |
Deferred tax in Statement of Profit and Loss during reporting period | 65,312 | | 29,891 |
Translation difference | (16,148) | | (478) |
Deferred tax in Statement of financial position - disposed companies | (33,176) | | - |
Deferred tax in Statement of financial position for the period | 58,162 | | 42,174 |
(*) Local reporting period for the Mobio Global UK is a financial year since June 1 until May 31 and the final amount of the profit tax payable will be calculated till the reporting date. According to the results of the local financial year for 2021, the Company received a loss, thus the amount of tax accrued in the reporting last year is reversed in the current year.
Reconciliation of tax expense 2022
| Mobio Global |
| Mobile Marketing |
| Mobio Singapore |
| Mobio USA |
| Consolidation adjustments |
| Total |
Profit on ordinary activities before taxation | (176,422) | | (5,782) | | 92,125 | | (100,285) | | (2,461,213) | | (2,651,577) |
Tax rate | 19% | | 20% | | 17% | | 21% | | - | | - |
Profit on ordinary activities multiplies by standard rate | (33,520) | | (1,157) | | 15,661 | | (21,060) | | - | | (83,942) |
Effects of: | | | | | | | | | | | |
(a) Taxes not recognized | - | | - | | (1 296) | | - | | - | | (1,296) |
(b) Tax effect of permanent difference / temporary | - | | (1,544) | | - | | - | | - | | (1,544) |
(c) Actual taxes in reporting package | (14,308) | | (9,077) | | (866) | | (21,060) | | - | | (45,311) |
(d) Profit tax to be paid | - | | 10,253 | | 17,823 | | - | | - | | 28,076 |
(e) Translation difference | (19,212) | | (789) | | - | | - | | - | | (20,001) |
Total | (33,520) |
| (1,157) |
| 15,661 |
| (21,060) |
| - |
| (40,076) |
Taxes in reporting package (c+d+e) | (33,520) |
| 387 |
| 16,957 |
| (21,060) |
| - |
| (37,236) |
Profit tax 2021 cancelling | (12,584) | | - | | - | | - | | - | | (12,584) |
Total taxes in reporting package | (46,104) |
| 387 |
| 16,957 |
| (21,060) |
| - |
| (49,820) |
Reconciliation of tax expense 2021
| Mobio Global |
| Mobile Marketing |
| Mobio Singapore |
| Total |
Profit on ordinary activities before taxation | 16,899 | | (26,211) | | 130 | | (9,182) |
Tax rate | 19% | | 20% | | 17% | |
|
Profit on ordinary activities multiplies by standard rate | | | | | | |
|
Effects of: | | | | | | |
|
(a) Taxes not recognized | - | | - | | 22 | | 22 |
(b) Tax effect of permanent difference / temporary | - | | (8,628) | | - | | (8,628) |
(c) Actual taxes in reporting package | (10,605) | | (18,941) | | - | | (29,546) |
(d) Profit tax to be paid | 13,998 | | 22,490 | | - | | 36,488 |
(e) Translation difference | (182) | | (163) | | - | | (345) |
Total | 3,211 |
| (5,242) |
| (22) |
| (2,009) |
Taxes in reporting package (c+d+e) | 3,211 |
| 3,386 |
| - |
| 6,597 |
Due to operational losses there were no profit tax implications related to Vox Capital Ltd, Vox Valor Capital Ltd and Vertu Capital Holding Ltd.
Net deferred tax assets recognized as of 31 December 2022, was not impaired.
9.1. Deferred taxes
| As of 1 January 2022 |
| Movements during reporting period |
| As of 31 December 2022 | ||||
| Deferred tax BS |
| Charge to profit or loss |
| Translation difference |
| Deferred tax writing-off (investment disposal) |
| Deferred tax BS |
Right-of-use assets | 2,139 | | (949) | | 62 | | (312) | | 940 |
Property, plant and equipment | (4,500) | | 2,110 | | (546) | | 2,936 | | - |
Intangible assets | - | | (2,356) | | 44 | | 974 | | (1,338) |
Trade receivables (payables) | 31,040 | | (25,831) | | 4,421 | | (36,627) | | (26,997) |
Borrowings | 147 | | (27) | | 27 | | (147) | | - |
Provisions | 13,348 | | (13,553) | | 205 | | - | | - |
Losses of previous years | - | | 87,026 | | (1,469) | | - | | 85,557 |
Translation difference effect | - | | 18,892 | | (18,892) | | - | | - |
Total | 42,174 |
| 65,312 |
| (16,148) |
| (33,176) |
| 58,162 |
| As of 1 January 2021 |
| Movements during reporting period |
| As of 31 December 2021 | |
| Deferred tax BS |
| Charge to profit or loss | Translation difference |
| Deferred tax BS |
Right-of-use assets | 3,863 | | (1,717) | (7) | | 2,139 |
Property, plant and equipment | (6,508) | | 1,988 | 20 | | (4,500) |
Trade receivables (payables) | (8,554) | | 40,104 | (510) | | 31,040 |
Borrowings | (2,650) | | 2,817 | (20) | | 147 |
Provisions | 7,400 | | 6,042 | (94) | | 13,348 |
Losses of previous years | 19,210 | | (19,343) | 133 | | - |
Total | 12,761 |
| 29,891 | (478) |
| 42,174 |
10. Transactions with owners (business restructuring)
Investment in Mobile Marketing LLC disposal
Given the current geopolitical context and uncertainty surrounding the sanction regime, on 22 July 2022 the Group disposed of Mobile Marketing LLC to Sergey Konovalov (international group member, the ultimate beneficiary), which became effective with the Russian registry on 2 August 2022. The consideration due from Sergey Konovalov to Mobio Global LTD as a result of the transfer was 303,660 USD. Mobio Global LTD applied the transfer consideration to repay part of the amounts owed (being at least 303,660 USD) by Mobio Global LTD to Vox Capital Ltd in respect intra-Group balances.
In connection with the deal on selling shares of Mobile Marketing LLC on August 2, 2022, the relevant amount of Contingent shares consideration was written-off the balance.
The sale of a subsidiary to an ultimate beneficiary is accounted for as an equity transaction with owners. The effect of restructuring of the business is as follows:
| 2022 |
Income from investment in Mobile Marketing LLC (Russia) sale | 303,660 |
Goodwill writing-off | (1,923,299) |
Mobile Marketing LLC (Russia) net assets | (702,268) |
Contingent shares consideration Mobio Russia writing-off | 1,195,583 |
Total effect on business restructuring | (1,126,323) |
Investment in Storiesgain Pte Ltd disposal
Storiesgain Pte Ltd is incorporated in Singapore. Its registered office is 68 Circular Road, #02-01, Singapore, 049422. The principal activity of Storiesgain Pte Ltd is advertising activities with other information technology and computer service activities as the secondary activity. As of 30 September 2021 the number of shares held in Storiesgain Pte Ltd was 20 and represented a 18.00% holding. The shares in Storiesgain Pte Ltd was directly held by Initium HK Limited. In accordance with Shares sale and purchase agreement dated June 25, 2022 the shares in Storiesgain Pte Ltd were sold to an independent buyer. The amount of remuneration due to the Group is 122,400.
The sale of a subsidiary to an ultimate beneficiary is accounted for as an equity transaction with owners. The effect of restructuring of the business is as follows:
The sale of a subsidiary to an ultimate beneficiary is accounted for as an equity transaction with owners. The effect of restructuring of the business is as follows:
| 2022 |
Income from investment in Storiesgain sale | 122,400 |
Cost of investment | (505,960) |
Effect on business restructuring | (383,560) |
Total effect on business restructuring is a loss in amount of USD 1,509,883.
11. Earnings per share
Basic (losses)/earnings per share is calculated by dividing the profit/(loss) attributable to equity shareholders by the weighted average number of shares outstanding during the year.
Diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares outstanding to assume conversion of all dilutive potential ordinary shares. As at 31 December 2022 the Group has outstanding Warrants issued to the NED Directors (Non-executive directors) and Stonedale Management and Investments Limited Ltd (Stonedale), which when exercised will convert into Ordinary Shares. Total number of Warrants in issue is 45,833,333.
Stonedale Warrant Instrument
The Group and Stonedale entered into a warrant deed dated 30 September 2022, pursuant to which the Company had granted to Stonedale the Fee Warrants. The Fee Warrants represent 0.87 per cent of the Enlarged Ordinary Share Capital. The Fee Warrants are capable of being exercised for a price of £0.012 and for a term of three years from the date of Admission.
NED Warrant Instrument
The Group and the NED Directors entered into a warrant deed dated 30 September 2022, pursuant to which the Company had granted to NED Directors the NED Warrants. The NED Warrants represent 1.06 per cent of the Enlarged Ordinary Share Capital. The NED Warrants are capable of being exercised for a price of £0.012 and for a term of three years from the date of Admission.
| | 31 December 2022 |
| 31 December 2021 |
Loss for the period after tax for the purposes of basic and diluted earnings per share | | (3,145,770) | | (2,458,108) |
Number of ordinary shares | | 2,368,395,171 | | 2,141,913,820 |
Weighted average number of ordinary shares in issue for the purposes of basic earnings per share | | 2,195,443,485 | | 2,133,633,256 |
Loss per share (cent) | | (0.14) | | (0.12) |
During a period where the Group or Company makes a loss, accounting standards require that 'dilutive' shares for the Group be excluded in the earnings per share calculation, because they will reduce the reported loss per share; consequently, all per-share measures in the current period are based on the weighted number of ordinary shares in issue.
12. Goodwill
Information on goodwill occurred as a result of subsidiaries acquisition is presented in the table below:
| 31 December 2022 |
| 30 September 2021 |
Goodwill as of year beginning | 1,923,299 |
| - |
Additions to Mobile Marketing LLC (Russia) | - | | 1,923,299 |
Additions to Mobio (Singapore) PTE LTD
| - | | 1,948,096 |
Translation differences | - | | - |
Impairment | | | (1,948,096) |
Sale | (1,923,299) | | - |
Goodwill of period end | - |
| 1,923,299 |
Goodwill impairment test
On 22 July 2022 the Group disposed of Mobile Marketing LLC to Sergey Konovalov (international group member, the ultimate beneficiary). The amount of goodwill relating to Mobile Marketing LLC was written-off and reflected as an equity transaction with owners (Note 10.1).
As at 30 September 2021 the carrying values of the Group's goodwill was amounted to 1,923,299 USD relating to the acquisition of businesses of Mobile Marketing LLC (Russia) and Mobio Singapore (Singapore). The goodwill recognized from the acquisition of businesses have been allocated to the only the cash-generating unit (CGU) of the business.
The Management performs impairment assessments of goodwill annually, using the value in use method by preparing discounted cash flow forecasts derived from the most recent financial forecast approved by the Management. The preparation of discounted cash flow forecasts involves the exercise of significant judgement, particularly in estimating the revenue growth rates and the discount rates applied.
The recoverable amount of CGU is determined based on value-in-use calculations. These calculations use cash flow projection based on financial forecast approved by management covering an eight-year period. The key assumptions used in the estimation of the recoverable amount are pre-tax discount rate and budgeted revenue growth rate (average of financial forecasts period) set out below. The expected revenue growth rate is following the business plan approved by the Group. Pre-tax discount rate represents the current market assessment of the risks specific to the CGU, regarding the time value of money and individual risks of the underlying assets which have not been incorporated in the cash flow estimates.
In percent Pre-tax discount rate 12.41% (industry average 33.6%). Budgeted revenue growth rate (average of financial forecasts period) is 22% (industry average is 10.6%). The estimated recoverable amount of the CGU (Mobio (Singapore) PTE LTD) is less than its carrying amount resulting in attributable goodwill impairment of 1,948,096 USD.
13. Tangible fixed assets
| 31 December 2022 |
| 30 September 2021 | ||||
Cost | Computers, phones |
| Total |
| Computers, phones |
| Total |
As of beginning of the period | 93,346 | | 93,346 | | - | | - |
Additions from the subsidiaries | - | | - | | 77,150 | | 77,150 |
Additions | 7,110 | | 7,110 | | 16,773 | | 16,773 |
Disposals | (14,443) | | (14,443) | | - | | - |
Disposals - subsidiaries sale | (83,986) | | (83,986) | | - | | - |
Translation difference | 1,364 | | 1,364 | | (577) | | (577) |
As of period end | 3,391 |
| 3,391 |
| 93,346 |
| 93,346 |
| | | | | | | |
Depreciation |
| | | | | | |
As of beginning of the period | (71,778) | | (71,778) | | - | | - |
Additions from the subsidiaries | - | | - | | (53,028) | | (53,028) |
Depreciation charge | (9,497) | | (9,497) | | (19,213) | | (19,213) |
Disposals | 14,443 | | 14,443 | | - | | - |
Disposals - subsidiaries sale | 67,938 | | 67,938 | | - | | - |
Translation difference | (1,106) | | (1,106) | | 463 | | 463 |
As of period end | - |
| - |
| (71,778) |
| (71,778) |
| | | | | | | |
Net book value |
| | | | | | |
As of beginning of the period | 21,568 | | 21,568 | | - | | - |
As of period end | 3,391 |
| 3,391 | | 21,568 | | 21,568 |
Tangible fixed assets are amortized over 3 years. Depreciation expenses are included in profit and loss under the «Depreciation of tangible / intangible assets».
14. Intangible assets
Intangible assets movement as of 31 December 2022:
Cost | Trademark |
| Programs |
| Licenses |
| Total |
As of 30 September 2021 | 316 |
| 29,382 |
| 5,452 |
| 35,150 |
Additions | - | | - | | 17,472 | | 17,472 |
Disposals | - | | - | | (5,275) | | (5,275) |
Disposals - subsidiaries sale | (321) | | (29,835) | | (2,456) | | (32,612) |
Translation difference | 5 | | 453 | | (249) | | 209 |
As of 31 December 2022 | - |
| - |
| 14,944 |
| 14,944 |
Depreciation |
| | | | | | |
As of 30 September 2021 | (100) |
| (24,487) |
| (3,387) |
| (27,974) |
Depreciation charge | (19) | | (2,948) | | (11,200) | | (14,167) |
Disposals | - | | - | | 5,275 | | 5,275 |
Disposals - subsidiaries sale | 120 | | 27,812 | | 1,282 | | 29,214 |
Translation difference | (1) | | (377) | | 124 | | (254) |
As of 31 December 2022 | - |
| - |
| (7,906) |
| (7,906) |
Net book value |
| | | | | | |
As of 30 September 2021 | 216 | | 4,895 | | 2,065 | | 7,176 |
As of 31 December 2022 | - | | - | | 7,038 | | 7,038 |
Intangible assets movement as of 30 September 2022:
Cost | Trademark |
| Programs |
| Licenses |
| Total |
As of 30 September 2020 | - | | - | | - | | - |
Additions | 295 | | 27,394 | | 9,498 | | 37,187 |
Disposals | - | | - | | (4,068) | | (4,068) |
Translation difference | 21 | | 1,988 | | 22 | | 2,031 |
As of 30 September 2021 | 316 |
| 29,382 |
| 5,452 |
| 35,150 |
| | | | | | | |
Amortisation |
| | | | | | |
As of 30 September 2020 | - | | - | | - | | - |
Amortisation charge | (89) | | (21,850) | | (7,083) | | (29,022) |
Disposals | (8) | | (1,523) | | 3,702 | | 2,171 |
Translation difference | (3) | | (1,114) | | (6) | | (1,123) |
As of 30 September 2021 | (100) |
| (24,487) |
| (3,387) |
| (27,974) |
| | | | | | | |
Net book value |
| | | | | | |
As of 30 September 2020 | - | | - | | - | | - |
As of 30 September 2021 | 216 |
| 4,895 |
| 2,065 |
| 7,176 |
Amortization is recognized in the income statements using the straight-line method over the estimated useful life:
· Trademarks - 10 years.
· Licenses - validity period.
· Programs - 5 years.
15. Right-of-use assets
Right-of-use assets movement as of 31 December 2022:
Cost | Leased property |
| Leased server |
| Total |
As of 30 September 2021 | 92,170 |
| 93,261 |
| 185,431 |
Additions | - | | 77,850 | | 77,850 |
Disposals | (23,561) | | (94,698) | | (118,259) |
Disposals - subsidiaries sale | (70,029) | | - | | (70,029) |
Translation difference | 1,420 | | 1,038 | | 2,458 |
As of 31 December 2022 | - |
| 77,451 |
| 77,451 |
Depreciation |
| | | | |
As of 30 September 2021 | (23,042) |
| (43,522) |
| (66,564) |
Depreciation charge | (18,854) | | (19,436) | | (38,290) |
Disposals | 23,561 | | 52,084 | | 75,645 |
Disposals - subsidiaries sale | 18,854 | | - | | 18,854 |
Translation difference | (519) | | (421) | | (940) |
As of 31 December 2022 | - |
| (11,295) |
| (11,295) |
Net book value |
| | | | |
As of 30 September 2021 | 69,128 | | 49,739 | | 118,867 |
As of 31 December 2022 | - | | 66,156 | | 66,156 |
Right-of-use assets movement as of 30 September 2021:
Cost | Leased property |
| Leased server |
| Total |
As of 30 September 2020 | - | | - | | - |
Additions | 160,938 | | 86,950 | | 247,888 |
Disposals | (73,534) | | - | | (73,534) |
Translation difference | 4,766 | | 6,311 | | 11,077 |
As of 30 September 2021 | 92,170 |
| 93,261 |
| 185,431 |
| | | | | |
Depreciation |
| | | | |
As of 30 September 2020 | - | | - | | - |
Depreciation charge | (37,076) | | (37,653) | | (74,729) |
Disposals | 14,503 | | (4,546) | | 9,957 |
Translation difference | (469) | | (1,323) | | (1,792) |
As of 30 September 2021 | (23,042) |
| (43,522) |
| (66,564) |
| | | | | |
Net book value |
| | | | |
As of 30 September 2020 | - | | - | | - |
As of 30 September 2021 | 69,128 | | 49,739 | | 118,867 |
Lease liabilities in respect of right-of-use assets:
| Leased property |
| Leased server |
| Total |
As of 31 December 2022 | - |
| 71,103 |
| 71,103 |
including: | | | | | |
long-term | - |
| 53,722 |
| 53,722 |
short-term | - |
| 17,381 |
| 17,381 |
|
|
|
|
|
|
As of 30 September 2021 | 64,267 |
| 59,696 |
| 123,963 |
including: | | | | | |
long-term | 40,243 |
| 37,415 |
| 77,658 |
short-term | 24,024 |
| 22,281 |
| 46,305 |
| | | | | |
Interest expense recognized: | Leased property |
| Leased server |
| Total |
As of 31 December 2022 | 2,999 | | 2,033 | | 5,032 |
As of 30 September 2021 | 5,562 | | 3,291 | | 8,853 |
The discount rate 2022 used in determining the present value of the lease liability was determined based on the borrowing rates placed at Bank of England official site (https://www.bankofengland.co.uk/statistics/effective-interest-rates) and consisted as follows:
The discount rate 2021 used in determining the present value of the lease liability was determined based on the borrowing rates placed at the Bank of Russia official site and consisted of:
- for the leased server: 4.65%
- for the leased property (rental agreement 2021): 7.67%
16. Investments in subsidiaries
Subsidiary undertakings | Country of incorporation |
|
|
|
| | 31 December 2022 |
| 30 September 2021 |
Vertu Capital Holding Ltd. | United Kingdom | 100% | | 100% |
Vox Capital Ltd | United Kingdom | 100% | | - |
Mobio Global Ltd | United Kingdom | 100% | | - |
Vox Valor Capital Pte Ltd | Singapore | 100% | | - |
Initium HK Ltd | Hong Kong | 100% | | - |
Vox Valor Capital Pte. Limited and Initium HK Limited are companies holding investments in stock.
Mobio Global Limited was created as an acquisition purposes vehicle. During the period ended 30 September 2021, Mobio Global has acquired two subsidiaries, Mobile Marketing LLC and Mobio (Singapore) PTE LTD. Remuneration was paid partly in cash in the amount of 890,881 USD and partly by assuming liability from the shareholder (in the amount of 2,529,250 USD) and assuming contingent shares consideration (liability) in amount of 1,320,735 USD. Accordance with Sale-Purchase agreement dated July 22, 2022 the 100% shares in Mobile Marketing LLC was sold. The shares transferred to the buyer from the moment the corresponding entry was made in the Unified State Register of Legal Entities, on August 2, 2022.
On April 27, 2022, the Company purchased the shares in Mobio Global Inc. (USA), the total purchase price is 30,000 USD.
Subsidiary undertakings | Country of incorporation |
|
|
|
| | 31 December 2022 |
| 30 September 2021 |
Mobile Marketing LLC | Russian Federation | - | | 100% |
Mobio (Singapore) PTE LTD | Singapore | 100% | | 100% |
Mobio Global Inc. | USA | 100% | | 100% |
The registered office of Mobile Marketing LLC is off. XLVII, floor 7, build.1, Novodmitrovskaya str., 2, Moscow, 127015, Russian Federation.
The registered office of Mobio (Singapore) PTE LTD is 1 George Street #10-01, One George Street, Singapore 049145.
The registered office of Mobio Global Inc. is 850 New Burton Road, Suite 201, Dover, DE 19904. USA
Investments at fair value
Investments at fair value |
| 31 December 2022 |
| 30 September 2021 |
Airnow PLC shares | | 10,156,281 | | 11,647,947 |
Storiesgain Pte Ltd shares | | - | | 122,400 |
Total |
| 10,156,281 |
| 11,770,347 |
Airnow PLC is incorporated in the United Kingdom. Its registered office is Salisbury House, London Wall, London, EC2M 5PS. The principal activity of Airnow PLC is the development of services to the mobile app community. The number of shares held in Airnow PLC is 5,736,847 and represents a 6.37% holding. The shares in Airnow PLC are directly held by Vox Valor Capital Singapore Pte Limited. There is no amount still to be paid in respect of these shares. No amount is owed either to or from Airnow PLC by the Vox Group.
17. Trade and other receivables
| 31 December 2022 |
| 30 September 2021 |
Trade receivables | 2,924,351 | | 1,752,347 |
Provision for bad debts | (6,702) | | (66,739) |
Prepayments | 12,446 | | 58,263 |
Total | 2,930,095 |
| 1,743,871 |
All of the trade receivables were non-interest bearing and receivable under normal commercial terms. The Directors consider that the carrying value of trade and other receivables approximates to their fair value. The ageing of trade receivables is detailed below:
As of 31 December 2022
| < 60 days |
| < 90 days |
| < 180 days |
| > 180 days |
| Total |
Trade receivables | 2,917,649 | | - | | - | | 6,702 | | 2,924,351 |
Provision for bad debts | - | | - | | - | | (6,702) | | (6,702) |
Total | 2,917,649 |
| - |
| - |
| - |
| 2,917,649 |
As of 30 September 2021
| < 60 days |
| < 90 days |
| < 180 days |
| > 180 days |
| Total |
Trade receivables | 1,575,580 | | 110,028 | | 54,594 | | 12,145 |
| 1,752,347 |
Provision for bad debts | - | | - | | (54,594) | | (12,145) |
| (66,739) |
Total | 1,575,580 |
| 110,028 |
| - | | - |
| 1,685,608 |
18. Cash and cash equivalents
| 31 December 2022 |
| 30 September 2020 |
Cash at bank and in hand | 911,686 | | 756,159 |
Total | 911,686 |
| 756,159 |
19. Other short-term assets
| 31 December 2022 |
| 30 September 2021 |
VAT | - | | 124,271 |
Profit tax overpayment | - | | 3,834 |
Social tax prepayment | - | | 3,962 |
Other debtors | 3,516 | | 4,109 |
Total | 3,516 |
| 136,176 |
20. Trade and other payables
| 31 December 2022 |
| 30 September 2021 |
Trade payables | 298,546 | | 121,858 |
Contract liabilities | 2,593,207 | | 1,714,339 |
Other taxes and social security costs | 8,068 | | 125,838 |
Other payables and accruals | 5,270 | | 3,012 |
Total | 2,905,091 |
| 1,965,047 |
The fair value of trade and other payables approximates to book value at each year end. Trade payables are non-interest bearing and are normally settled monthly.
21. Loans and borrowings
Long-term | 31 December 2022 |
| 30 September 2021 |
Triple Dragon Funding Delta Limited (TDFD) | 1,625,000 | | 1,000,000 |
AdTech Solutions Limited | 385,000 | | - |
Mobile Marketing LLC | 45,712 | | - |
Total | 2,055,712 |
| 1,000,000 |
Short-term | 31 December 2022 |
| 30 September 2021 |
AdTech Solutions Limited | 38,038 | | 22,565 |
Mobile Marketing LLC | 46,570 | | - |
Total | 81,608 |
| 22,565 |
During the year ended 31 December 2022, the Group used a lending facility from Triple Dragon Funding Delta Limited (TDFD). The TDFD facility is secured by a floating charge that covers the property and undertakings of Vox Capital Ltd and Mobio Global Ltd. Interest is charged on the loan at a rate of 2.25% per calendar month.
On July 27, 2022 the loan agreement between Mobio Global LTD (borrower) and Mobile Marketing LLC (lender) dated 06.10.2020 was assigned to Adtech Solutions Limited. Final repayment date is March 1, 2024. Interest is charged on the loan at a rate of 7.5% per calendar month.
As of 31 December 2022 the debts on loan between Mobile Marketing LLC and Vox Capital Ltd (loan agreement dated 16 December 2020) is reflected as a loans and borrowings with third parties as Mobile Marketing LLC is no longer the part of the Group. Interest is charged on the loan at a rate of 7.5% per calendar month.
22. Convertible notes
| 31 December 2022 |
| 30 September 2021 |
Net proceeds of issue | - | | 194,340 |
Equity component | - | | (393) |
Liability component | - | | 193,947 |
Interest to period end | - | | 5,569 |
Revaluation at year end | - | | 2,918 |
Convertible notes liability | - |
| 202,434 |
Vox Capital Ltd issued the following convertible notes:
- August 13, 2021 EUR 169,500 Slowdive LTD
- October 20, 2021 USD 150,000 private investor
- October 25, 2021 USD 150,000 private investor
- December 02, 2021 EUR 80,000 Mutual Investments SIA
- December 28, 2021 EUR 440,000 Rare Pepe Collection
The convertible loan born interest from 6% till 20% per annum, payable on repayment, and was converted into Vox Capital Ltd shares. The convertible loans, save for $75,000, was converted into shares before acquisition.
23. Other long-term and lease liabilities
Lease liabilities
| 31 December 2022 |
| 30 September 2021 |
Non-current liabilities |
|
|
|
Lease liabilities | 53,722 | | 77,658 |
Current liabilities | | | |
Lease liabilities | 17,381 | | 46,305 |
Total | 71,103 |
| 123,963 |
As at the year ended 31 December 2022 the Group leases a server for the purpose of storing files and documents. The Group does not lease any premises in London, Singapore and USA.
As at the year ended 30 September 2021 the Group leased an office building in Moscow for use by its staff. It also leased a server for the purpose of storing files and documents. The Group did not lease any premises in London and Singapore.
Interest expense recognized: | Leased property |
| Leased server |
| Total |
As of 31 December 2022 | 2,999 | | 2,033 | | 5,032 |
As of 30 September 2021 | 5,562 | | 3,291 | | 8,853 |
The discount rate 2022 used in determining the present value of the lease liability was determined based on the borrowing rates placed at Bank of England official site (https://www.bankofengland.co.uk/statistics/effective-interest-rates) and consisted as follows:
The discount rate 2021 used in determining the present value of the lease liability was determined based on the borrowing rates placed at the Bank of Russia official site and consisted of:
- for the leased server: 4.65%
- for the leased property (rental agreement 2021): 7.67%
24. Other short-term liabilities
| 31 December 2022 |
| 30 September 2021 |
VAT payable (tax agent) | 152,914 | | 168,283 |
Salary liabilities | - | | 2,569 |
Provision for vacation | - | | 30,718 |
Current lease liabilities | 17,381 | | 46,305 |
Other liabilities | - | | 2,964 |
Total | 170,295 |
| 250,839 |
25. Financial instruments
The Group's financial instruments may be analysed as follows:
Financial assets | 31 December 2022 |
| 30 September 2021 |
Financial assets measured at amortised cost: | | | |
Cash at bank and in hand | 911,686 | | 756,159 |
Trade receivables | 2,917,649 | | 1,685,608 |
Other receivables | 12,446 | | 58,263 |
Total | 3,841,781 |
| 2,500,030 |
Financial liabilities | 31 December 2022 | | 30 September 2021 |
Financial liabilities measured at amortised cost: | | | |
Trade payables | 298,546 | | 121,858 |
Contract liabilities | 2,593,207 | | 1,714,339 |
Other taxes and social security costs | 8,068 | | 125,838 |
Lease liabilities | 71,103 | | 123,963 |
Total | 2,970,924 |
| 2,085,998 |
The Group's income, expense, gains and losses in respect of financial assets measured at fair value through profit or loss realised fair value gains of nil (2021: nil).
26. Financial risk management
The Group is exposed to a variety of financial risks through its use of financial instruments which result from its operating activities. All the Group's financial instruments are classified trade and other receivables. The Group does not actively engage in the trading of financial assets for speculative purposes. The most significant financial risks to which the Group is exposed are described below:
Credit risk
Generally, the Group's maximum exposure to credit risk is limited to the carrying amount of the financial assets recognised at the reporting date, as summarised below:
| 31 December 2022 |
| 30 September 2021 |
Trade receivables | 2,917,649 | | 1,685,608 |
Prepayments | 12,446 | | 58,263 |
Total | 2,930,095 |
| 1,743,871 |
Credit risk is the risk of financial risk to the Group if a counter party to a financial instrument fails to meet its contractual obligation. The nature of the Group's debtor balances, the time taken for payment by clients and the associated credit risk are dependent on the type of engagement.
The Group's trade and other receivables are actively monitored. The ageing profit of trade receivables is monitored regularly by Directors. Any debtors over 30 days are reviewed by Directors every month and explanations sought for any balances that have not been recovered.
Unbilled revenue is recognised by the Group only when all conditions for revenue recognition have been met in line with the Group's accounting policy.
The Directors are of the opinion that there is no material credit risk at the Group level.
Liquidity risk
Liquidity risk is the situation where the Group may encounter difficulty in meeting its obligations associated with its financial liabilities. The Group seeks to manage financial risks to ensure sufficient liquidity is available to meet any foreseeable needs and to invest cash assets safely and profitably.
The tables below break down the Group's financial liabilities into relevant maturity groups based on their contractual maturities.
The amounts disclosed in the tables below are the contractual undiscounted cash flows. Balances due within 12 months equal their carrying balances, because the impact of discounting is not significant.
Contractual maturities of financial liabilities as of 31 December 2022
| Less than 6 months | | 6-12 months | | Between 1 and 2 years | | Between 2 and 5 years | | Carrying amount |
| | | | | | | | | |
Trade and other payables | 2,905,091 | | - | | - | | - | | 2,905,091 |
Corporation tax payable | 17,823 | | - | | - | | - | | 17,823 |
Lease liabilities | 9,426 | | 7,955 | | 20,298 | | 33,424 | | 71,103 |
Total | 2,932,340 |
| 7,955 |
| 20,298 |
| 33,424 |
| 2,994,017 |
Contractual maturities of financial liabilities as of 30 September 2021
| Less than 6 months | | 6-12 months | | Between 1 and 2 years | | Between 2 and 5 years | | Carrying amount |
| | | | | | | | | |
Trade and other payables | 1,965,047 | | - | | - | | - | | 1,965,047 |
Corporation tax payable | 13,762 |
| - |
| - | | - | | 13,762 |
Lease liabilities | 19,979 | | 26,326 | | 55,212 | | 22,446 | | 123,963 |
Total | 1,998,788 |
| 26,326 |
| 55,212 |
| 22,446 | | 2,102,772 |
Interest rate risk
The Group is not exposed to material interest rate risk as its liabilities are either non-interest bearing or subject to fixed interest rates.
Foreign currency risk
The Group operates internationally and is exposed to foreign exchange risk arising from various currency exposures, primarily the Russian Ruble. The Group monitors exchange rate movements closely and ensures adequate funds are maintained in appropriate currencies to meet known liabilities.
The Group's exposure to foreign currency risk at the end of the respective reporting period, expressed in Currency Units, was as follows:
Cash & cash equivalents | | RUB | | GBP | | EUR |
| | | | | | |
30 September 2021 | | 41,820,662 | | 1,284 | | 105,394 |
31 December 2022 | | - | | 157,104 | | 11,291 |
The Group is exposed to foreign currency risk on the relationship between the functional currencies of the Group companies and the other currencies in which the Group's material assets and liabilities are denominated. The table below summaries the effect on profit and loss had the functional currency of the Group weakened or strengthened against these other currencies, with all other variables held constant.
| | 2022 |
| 2022 |
| 2022 |
| | RUB | | GBP | | EUR |
10% weakening of functional currency | | - | | (15,710) | | (1,129) |
10% strengthening of functional currency | | - | | 15,710 | | 1,129 |
| | 2021 |
| 2021 |
| 2021 |
| | RUB | | GBP | | EUR |
10% weakening of functional currency | | (4,182,066) | | (128) | | (10,539) |
10% strengthening of functional currency | | 4,182,066 | | 128 | | 10,539 |
The impact of a change of 10% has been selected as this has been considered reasonable given the current level of exchange rates and the volatility observed both on a historical basis and market expectations for future movements.
Reputational risks
The Management of the Group believes that at present there are no facts that could have a significant negative impact on the decrease in the number of its customers due to a negative perception of the quality of services provided, adherence to the terms of rendering services, as well as the participation of the Group in any price agreement. Accordingly, reputational risks are assessed by the Group as insignificant.
Fair value of financial instruments
The fair values of all financial assets and liabilities approximates their carrying value.
Country risks
4 February 2022 Russia declared a war operation in Ukraine and launched full-scale military invasion., multilateral sanctions and restrictions were imposed on work with certain Russian legal entities and individuals. These circumstances caused unpredictable volatility in the stock and currency markets, in energy prices, general price level, the Bank of Russia's key interest rate and restrictions on flow of certain groups of goods. It is expected that these events may affect the business of companies in various countries and industries.
One of the Directors of the Group is a citizen of the Russian Federation. He is not subject to the sanctions imposed by the United Kingdom and other countries. Since 2 August 2022 the Group does not provide to and receive services from Russian companies.
The Management analyzes the current situation and possible solutions. At present, the duration of these events cannot be predicted and their impact on the future financial position and performance of the Group cannot be reliably assessed.
Other risks
The industry risk is currently assessed as low, and the volume of advertising on the Internet is growing. However, it should be taken into consideration that the industry is affected by changing legislation on the regulation of the advertising services provision and compliance with information security of data. Also, the Group business depends on the availability, performance and reliability of internet, mobile and other infrastructures (speed, data capacity and security) that are not under the Group control.
The Group makes every effort to comply with the requirements of the legislation and to maintenance of a reliability for providing advertising internet services.
27. Related party disclosures
Parties are generally considered to be related if one party has the ability to control the other party or can exercise significant influence in making financial and operational decisions.
The related parties of the Group are:
· Petrus Cornelis Johannes Van Der Pijl - Director, international group member (the ultimate beneficiary).
· Stefans Keiss - international group member (the ultimate beneficiary).
· S Konovalov - international group member (the ultimate beneficiary).
· Vox Valor Capital Pte. LTD - international group member.
· Vox Capital LTD - international group member. The shareholder of the Mobio Global LTD.
· Vox Valor Capital LTD - international group member.
· Vox Capital Holding LTD - international group member.
· Vox Valor Holding LTD - international group member.
The affiliated parties of the Company are:
· Mobile Marketing LLC - through S. Konovalov.
· Influence LLC - through S. Konovalov.
· Adtech solutions limited - through S. Konovalov
· Triple Dragon Services OÜ - through Petrus Cornelis Johannes Van Der Pijl
· Triple Dragon Limited - through Petrus Cornelis Johannes Van Der Pijl
· Triple Dragon Funding Delta Limited - through Petrus Cornelis Johannes Van Der Pijl
26.1. Transactions with related parties
· Trade and other receivables - related parties (immediate parent company for the Group) as of December 31, 2022:
Creditor |
| Related party |
| Description |
| 2022 |
| 2021 |
Vox Capital Ltd | | Mobio Global LTD | | "Setfords Law" LTD costs due from PLC | | 8,591 | | 9,604 |
Vox Capital Ltd | | Mobile Marketing LLC | | Loan agreement dated 16.12.2020 | | - | | 40,000 |
Vox Capital Ltd | | Mobile Marketing LLC | | Loan agreement dated 16.12.2020 | | - | | 3,106 |
| |
|
| Total: |
| 8,591 |
| 52,710 |
· Trade and other payables - related parties (immediate parent company for the Group) as of December 31, 2022
Debtor |
| Related party |
| Description |
| 2022 |
| 2021 |
Vox Capital Ltd | | Mobio Global LTD | | Intercompany payments | | 2,448,048 | | 3,016,947 |
| |
|
| Total: |
| 2,448,048 |
| 3,016,947 |
26.2. Transactions with affiliated parties
· Trade and other receivables - affiliated parties as of December 31, 2022:
Debtor |
| Affiliated party |
| Description |
| 2022 |
| 2021 |
Mobio Global LTD | | Triple Dragon Services OÜ | | Service agreement | | 650,586 | | - |
Mobio Global LTD | | Mobile Marketing LLC | | Service agreement | | 185,696 | | - |
Mobio (Singapore) Pte LTD | | Triple Dragon Services OÜ | | Service agreement | | 44,500 | | - |
| |
|
| Total: |
| 880,782 |
| - |
· Trade and other payables - affiliated parties as of December 31, 2022:
Creditor |
| Affiliated party |
| Description |
| 2022 |
| 2021 |
Mobio Global LTD | | Triple Dragon Services OÜ | | Service agreement | | 145,623 | | - |
Mobio (Singapore) Pte LTD | | Triple Dragon Services OÜ | | Service agreement | | 125,094 | | - |
Mobio Global LTD | | Mobile Marketing LLC | | Audit fees charging | | 37,168 | | - |
Mobio (Singapore) Pte LTD | | Mobile Marketing LL | | Audit fees charging | | 15,924 | | - |
| |
|
| Total: |
| 323,809 |
| - |
· Other short-term assets and financial assets - affiliated parties as of December 31, 2022:
Debtor |
| Affiliated party |
| Description |
| 2022 |
| 2021 |
Mobio Global LTD | | Mobile Marketing LLC | | Other short-term assets | | 3,516 | | - |
Mobile Marketing LLC | | Influence LLC | | Loan agreement (long term) | | - | | 2,684 |
Mobile Marketing LLC | | Influence LLC | | Loan agreement (short term) | | - | | 208 |
| |
|
| Total: |
| 3,516 |
| 2,892 |
· Loans - affiliated parties as of December 31, 2022:
Creditor |
| Affiliated party |
| Description |
| 2022 |
| 2021 |
Mobio Global LTD | | Adtech solutions limited | | Loan agreement - principal | | 385,000 | | - |
Mobio Global LTD | | Adtech solutions limited | | Loan agreement - interest | | 46,570 | | - |
Vox Capital Ltd | | Triple Dragon Funding Delta Limited | | Loan agreement - principal | | 1,625,000 | | 1,000,000 |
Vox Capital Ltd | | Triple Dragon Funding Delta Limited | | Loan agreement - interest | | 35,038 | | 22,565 |
Vox Capital Ltd | | Mobile Marketing LLC | | Loan agreement - principal | | 40,000 | | - |
Vox Capital Ltd | | Mobile Marketing LLC | | Loan agreement - interest | | 5,712 | | - |
| |
|
| Total: |
| 2,137,320 |
| 1,022,565 |
· Income and expenses - affiliated parties as of December 31, 2022:
Parent company |
| Affiliated party |
| Description |
| 2022 |
| 2021 |
Mobio Global LTD | | Triple Dragon Services OÜ | | Sales revenue | | 5,256,060 | | - |
Mobio (Singapore) Pte LTD | | Triple Dragon Services OÜ | | Sales revenue | | 44,500 | | - |
Mobio Global LTD | | Triple Dragon Services OÜ | | Operating expenses | | (1,806,281) | | - |
Mobio (Singapore) Pte LTD | | Triple Dragon Limited | | Operating expenses | | (680,484) | | - |
Vox Capital Ltd | | Triple Dragon Funding Delta Limited | | Interest expenses | | (303,711) | | - |
Mobio Global LTD | | Adtech solutions limited | | Interest expenses | | (12,748) | | - |
Mobile Marketing LLC | | Influence LLC | | Interest income | | 133 | | 210 |
Remuneration paid to key management personnel:
| | | Director's fees |
|
|
| Holding company | | Subsidiary companies |
| Total |
Directors remuneration 2022 | 177,503 | | 59,134 |
| 236,637 |
Directors remuneration 2021 | 106,829 | | 33,022 |
| 139,851 |
28. Share capital
| 31 December 2022 |
| 30 September 2021 |
Share capital | 194,426 | | 187,128 |
Share premium | 13,660,572 | | 12,705,270 |
Total | 13,854,998 |
| 12,892,398 |
Capital reduction
Given the current geopolitical context and uncertainty surrounding the sanction regime, 22 July 2022 the Group disposed of Mobile Marketing LLC to Sergey Konovalov. The consideration due from Sergey Konovalov to Mobio Global LTD as a result of the transfer was USD 303,660. Sergey Konovalov confirmed that he was willing to cancel 143,778 of his shares in the Vox Capital Ltd to finance the acquisition of Mobile Marketing LLC and Mobio Global LTD applied the transfer consideration to repay part of the amounts owed (being at least USD 303,660) by Mobio Global LTD to Vox Capital Ltd in respect intra-Group balances. As a result of that Vox Capital Ltd made the following reduction of capital:
29. Reverse acquisition
On 30 September 2022, the Company acquired the entire issued share capital of Vox Capital Ltd and its subsidiaries, a private company incorporated in United Kingdom, by way of a share-for-share exchange. Although the transaction resulted in the Vox Capital Ltd becoming a wholly owned subsidiary of the Company, the transaction constitutes a reverse acquisition in as much as the shareholders Vox Capital Ltd owned, post transaction, a majority of the issued ordinary shares of the Company.
In substance, the shareholders of the Vox Capital Ltd acquired a controlling interest in the Company and the transaction has therefore been accounted for as a reverse acquisition.
Accordingly, this reverse acquisition does not constitute a business combination and was accounted for in accordance with IFRS 2 Share-based payment and IFRIC guidance, with the difference between the equity value given up by the Vox Capital Ltd shareholders and the share of the fair value of net assets gained by the Vox Capital Ltd shareholders charged to the statement of comprehensive income as the cost of acquiring an Standard list quoted listing in the form of a share based payment expense.
In accordance with reverse acquisition accounting principles, these consolidated financial statements represent a continuation of the consolidated financial statements of Vox Capital Ltd and include:
a. the assets and liabilities of Vox Capital Ltd at their pre-acquisition carrying amounts and the results for both periods; and
b. the assets and liabilities of the Company as at 30 September 2021 and as at 31 December 2022.
Share-base-payment components of the reverse acquisition transaction are measured under IFRS 2. Equity-settled transactions are measured at the fair value of the assets and services acquired, if this fair value is reliably determinable. Fair value of The Company assets includes identifiable net assets and possibly unidentified assets or services, such as costs of listing.
The fair value of net assets of Vertu Capital Ltd at the date of acquisition was as follows:
| GBP | | USD 1.1150 |
Cash and cash equivalents | 151,255 | | 168,649 |
Other assets | 5,386 | | 6,005 |
Liabilities | (94,020) | | (104,832) |
Net assets | 62,621 |
| 69,822 |
In accordance with Prospectus, published on 30 September 2022:
| | GBP | | USD |
| | | 1.1150 | |
(1) | Shares in issue at the date of Prospectus | 143,999,998 | | |
(2) | Issue Price | 1.2p | | |
(3) | Total Consideration Shares to be issued on Admission | 2,203,564,840 | | |
(4) | The fair value of the consideration given up | 26,442,750 | | |
| Fair value of the outstanding shares of the Company just before the transaction (Share based payments): | |||
(5) | (4) / (3) = | 0.012 | | |
(6) | (1) * (5) = | 1,728,000 | | 1,926,720 |
| Identifiable assets and liabilities (net assets) of The Company at their fair value at the date of transaction: | |||
(7) | Net current assets | 62,621 | | 69,822 |
| Reverse acquisition expenses (6) - (7) = | 1,665,379 |
| 1,856,898 |
For calculation of the amounts into presentational currency, the GBP/USD rate as of 30 September 2022 was taken from https://www.exchangerates.org.uk/.
30. Exchange differences on translation foreign operations
| 31 December 2022 |
| 30 September 2021 |
Translation adjustment of the amount of investment to Mobio Group | 222,601 | | (222,601) |
Total | - |
| (222,601) |
In accordance with the Share purchase agreement (SPA) dated 14 October 2020, the amount of Investment acquired companies valuated in USD ($). The amount of Investment taken into account of Mobio Global LTD in GBP (£) using the conversing date GBP/USD on the date of transaction.
Since the Investment is a non-monetary item, it is reported at the historical rate of the transaction and is not revalued in local report of Mobio Global LTD (IAS 21, paragraph 23).
In accordance with paragraph 39 of IAS 21: "Assets and liabilities for each statement of financial position presented shall be translated at the closing rate at the date of that statement of financial position". The translation of the amount of Investment to presentation currency significantly changes the price specified in the SPA. The difference between the SPA price and the amount at the exchange rate at the reporting date is shown as other components of equity.
Disclosure on December 31, 2022
Notes | Date |
| Amount £ | Amount $ |
Amount of Investment, beginning of the year | 30.09.2021 | | £3,669,330 | $4,740,866 |
Investment disposal | | | (£1 741 453) | ($2 250 000) |
Investment impairment | | | (£1 927 878) | ($2 490 866) |
Total investment | 31.12.2022 |
| - | - |
Cumulated exchange differences on translating foreign operations reversing |
|
|
| $222,601 |
Disclosure on 30 September 2021
Notes | Date | Rate | Amount £ | Amount $ |
Amount of Investment on the date of transaction | 14.10.2020 | 1.29320 | £3,781,987 | $4,890,866 |
Early payment discount | 31.12.2020 | 1.33149 | (£112,656) | ($150,000) |
Total investment |
|
| £3,669,330 | $4,740,866 |
Investment recalculation to the presentation currency using the closing rate date as of 31.12.2021 | | 1.3527 | | $4,963,467 |
Including: | | | | |
Investment |
|
|
| $4,740,866 |
Exchange differences on translating foreign operations |
|
|
| ($222,601) |
31. Capital management
The Group's objectives when managing capital are to:
- Safeguard their ability to continue as a going concern, so that they can continue to provide returns to shareholders and benefits for other stakeholders, and
- Maintain an optimal capital structure to reduce the cost of capital.
In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.
32. Environmental, Social and Governance (ESG).
Environment
Carbon footprint reduction.
Vox Valor Capital is committed to cutting its carbon footprint across the Group, whilst also seeking to become more energy efficient. The Company has used online video conferencing platforms throughout the pandemic and, where practicable, will continue to promote this for the majority of internal meetings to minimize travel footprint.
Reducing waste.
All staff actively engage in the recycling of all waste materials wherever possible.
Software development and servicing marketing campaigns for customers. Business activity of the Group includes mainly working on computers with relatively small negative effect on the environment. Management uses new technologies providing economy on electric resources.
Social
Diversity & Inclusion
Vox Valor Capital is committed to the equal treatment of all employees and prospective employees regardless of their background, gender, race, marital status, ethnic origin, disability or sexual orientation. The Company recognizes how important its people are in the success of the business. The Group is proud to recruit, develop and retain the most talented people from all different backgrounds. Vox Valor Capital understands the importance of diversity across the business to foster collaboration and a culture which strives to deliver the Group's strategy.
Career development
The Board believes that good progression opportunities for our team members are offered within the Group's businesses.
Health and Safety
Vox Valor Capital holds health and safety as a standing focus, for employees. All health and safety incidents are reported to the senior management regularly.
Anti-slavery statement
The Group is committed to effective systems and controls being in place to ensure the Modern Slavery Act 2015 is upheld throughout the business and that partners and affiliates, throughout the supply chain, have similarly high standards and respect all local and international laws and regulations.
Governance
Corporate governance statement
The Board believes in the value and importance of strong corporate governance, at executive level and throughout the operation of the business, and in our accountability to all stakeholders.
Future ESG goals
The Company recognizes that further progress can be made towards a sustainable future and has set the following goals:
- encourage employees to use recyclable or biodegradable materials,
- continue to recruit locally,
- continue promoting recycling across the Group,
- establish an ESG/sustainability committee.
33. Climate change
The Company takes into account the interconnection of climate risks with other types of risks and, on this basis, manages them as part of its overall risk management process. This analyses both transition risks (political, legal, technological, market, reputational, related to changes in demand and consumer preferences) and physical risks (related to the physical effects of climate change, natural disasters, extreme weather conditions) that may affect the company's operations. At the same time, the approach to identifying and assessing climate risks is based on the TCFD recommendations.
The Company's strategy on this issue is based on the results of a regular inventory of climate risks and their analysis, taking into account business continuity conditions and the impact on business processes for strategic and financial planning. The Company forecasts and takes into account macroeconomic and industry trends, long-term market trends and basic factors underlying the dynamics of demand, supply and demand for information products.
Based on this approach, the Company develops a Risk and Opportunity Management Program, the results of which are submitted for discussion by the Board of Directors with a regular assessment of the quality of such management
34. Events after the reporting date
On 23 February 2023, Vertu Capital Holding Ltd. (UK) was disposed. No significant financial effect will be recognized in the financial statements for the year ending 31 December 2023 for that disposal.
On 31 January 2023 Group the Term sheet with Company 1. Company 1 is a music mobile app developer that believes that making music should be accessible everywhere and to everyone. Company 1 apps are easy and fun to use. They are among the leading music apps on Google Play and the App Store. The Transaction is expected to be completed on or before 31 May 2023.
On 31 January 2023 Group the Term sheet with Company 2. Company 2 create exclusive mobile games because they believe that this is the true future of game development. Created over a hundred mobile apps and games. Some of the products were ranked the Top-1 in App Store. The Transaction is expected to be completed on or before 30 June 2023.
In the period between the reporting date and the date of signing the financial statements for the reporting year, there were no other facts of economic activity that could have an impact on the financial condition, cash flow or performance of the organization and which should be reflected.
VOX VALOR CAPITAL LIMITED
STANDALONE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
Statement of financial position as at 31 December 2022
All in GBP |
| Notes |
| 31 December 2022 |
| 31 December 2021 |
ASSETS |
| | | | | |
Non-current assets |
| | | | | |
Investments | | | | 26,442,751 | | 1 |
|
|
|
| 26,442,751 |
| 1 |
| | | | | | |
Current assets |
| | | | | |
Other receivables | | | | - | | - |
Other receivables - related parties | | | | 6,434 | | 165,739 |
Prepayments | | | | 5,336 | | 5,336 |
Cash and cash equivalents | | | | 145,564 | | 145,739 |
|
|
|
| 157,334 |
| 316,814 |
| | | | | | |
Current liabilities |
| | | | | |
Other payables |
| | | 122,492 | | 72,006 |
Accruals & Provision |
| | | 12,000 | | 12,000 |
|
| | | 134,492 | | 84,006 |
|
| | | | | |
NET ASSETS |
| | | 26,465,593 | | 232,808 |
|
| | | | | |
Equity attributable to owners of the parent: |
| | | | | |
Share capital | | | | 1,440,000 | | 1,440,000 |
Consideration Shares | | | | 26,442,750 | | - |
Accumulated losses | | | | (1,417,157) | | (1,207,192) |
TOTAL EQUITY |
|
|
| 26,465,593 |
| 232,808 |
| | | | | | |
Statement of changes in equity for the year ended 31 December 2022
All in GBP | Notes |
| Share Capital | Consideration Shares | Retained earnings | Total equity |
Balance at 1 January 2022 |
|
| 1,440,000 | - | (1,207,192) | 232,808 |
Proceeds from issuance of ordinary shares |
| | - | 26,442,750 | - | 26,442,750 |
Retained earnings |
| | - | - | (209,965) | (209,965) |
Other comprehensive income |
| | - | - | - | - |
Balance at 31 December 2022 |
|
| 1,440,000 | 26,442,750 | (1,417,157) | 26,465,593 |
All in GBP | Notes |
| Share Capital | Consideration Shares | Retained earnings | Total equity |
Balance at 1 January 2021 |
|
| 1,200,000 | - | (1,060,921) | 139,079 |
Proceeds from issuance of ordinary shares |
| | 240,000 | - | - | 240,000 |
Retained earnings |
| | - | - | (146,271) | (146,271) |
Other comprehensive income |
| | - | - | - | - |
Balance at 31 December 2021 |
|
| 1,440,000 | - | (1,207,192) | 232,808 |
Notes to the financial statements, comprising significant accounting policies and other explanatory information for the year ended 31 December 2022
GENERAL INFORMATION
Vox Valor Capital LTD (the "Company").
Vox Valor Capital LTD (old name Vertu Capital Limited) was incorporated in the Cayman Islands on 12 September 2014 as an exempted company with limited liability under the Companies Law. The registered office of the Company is Forbes Hare Trust Company Limited, Cassia Court, Camana Bay, Suite 716, 10 Market Street, Grand Cayman KY1-9006, Cayman Islands, registration number 291725.
Subsidiaries:
· Vertu Capital Holding Ltd United Kingdom 100% ownership by Vox Valor Capital LTD
· Vox Capital Plc United Kingdom 100% ownership by Vox Valor Capital LTD
Originally, the Company's nature of operations is to act as a special purpose acquisition company. On 30 September 2022, the Company purchased Vox Capital Plc and from that moment the principal activity of the Company is a business in the digital marketing, advertising and content sector.
The Company is controlled by Vox Valor Holding LTD (UK).
Final beneficiaries of The Company are: Pieter Van Der Pijl, Stefans Keiss, and Sergey Konovalov.
Management (Directors)
Before 30 September 2022:
· Kiat Wai Du,
· Shunita Maghji
· Simon Retter
Since 30 September 2022:
· John G Booth (Chairman and Non-Executive Director)
· Rumit Shah (Non-Executive Director)
· Simon Retter (Non-Executive Director)
· Konstantin Khomyakov (Finance Director)
Going concern
At the reporting date, the Company had cash balance of £145,564.
These financial statements have been prepared on a going concern basis, which assumes that the Company will continue to be able to meet its liabilities as and when they fall due in the foreseeable future.
ACCOUNTING POLICIES
The Financial Statements have been prepared in accordance with International Financial Reporting Standards ("IFRS") and IFRS Interpretations Committee ("IFRIC") interpretations.
The financial statements are presented in British Pound Sterling (£).
The notes are an integral part of the financial statements.
Reporting period
These financial statements represent the financial reporting period for the Company from January 1 till December 31, 2022.
General
An asset is disclosed in the statement of financial position when it is probable that the expected future economic benefits attributable to the asset will flow to the entity and the cost of the asset can be reliably measured. A liability is disclosed in the statement of financial position when it is expected to result in an outflow from the entity of resources embodying economic benefits and the amount of the obligations can be measured with sufficient reliability.
If a transaction results in transfer of future economic benefits and/or when all risks associated with assets or liabilities have been transferred to a third party, the asset or liability is no longer included in the statement of financial position. Assets and liabilities are not included in the statement of financial position if economic benefits are not probable or cannot be measured with sufficient reliability.
The income and expenses are accounted for during the period to which they relate. Revenue is recognized when control over service is transferred to a customer.
The Management is required to form an opinion and make estimates and assumptions for assets, liabilities, income, and expenses. The actual result may differ from these estimates. The estimates and the underlying assumptions are constantly assessed. Revisions are recognised during a corresponding revision period as well as any future periods affected by the revision. The nature of these estimates and judgements, including related assumptions, is disclosed in the notes to corresponding items in the financial statement.
Investments
Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognized immediately in profit or loss (IAS 36 Impairment of Assets). Impairment losses are reflected in non-operating expenses of Statement of profit and loss and other comprehensive income. Reversals of impairment losses are reflected in non-operating income.
A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
An associate is an entity, being neither a subsidiary not a joint venture, in which the company holds a long-term interest and where the company has significant influence. The company considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.
Entities in which the company has a long-term interest and shares control under a contractual arrangement are classified as jointly controlled entities.
Cash and cash equivalents
Cash and cash equivalents comprise cash balances and call deposits. Bank overdrafts that are repayable on demand and form an integral part of the Company's cash management are included as a component of cash and cash equivalents for the purpose only on the cash flow statement.
The cash flow statement from operating activities is reported using the indirect method.
Financial instruments
Financial assets and financial instruments are recognised on the statement of financial position when the Company becomes a party to the contractual provisions of the instrument.
Financial assets
Financial assets are classified, at initial recognition, as subsequently measured at amortised cost, fair value through other comprehensive income (OCI), and fair value through profit or loss. The classification of financial assets at initial recognition depends on the financial asset's contractual cash flow characteristics and the Company's business model for managing them.
The classification depends on the purpose for which the financial assets were acquired. Management determines the classification of its financial assets at initial recognition and re-evaluates this classification at every reporting date.
As at the reporting date, the Company did not have any financial assets subsequently measured at fair value.
Financial liabilities
Trade and other payables are initially measured at fair value, net of transaction costs, and are subsequently measured at amortised cost, where applicable, using the effective interest method, with interest expense recognised on an effective yield basis.
Derecognition of financial liabilities
The Company derecognises financial liabilities when, and only when, the Company's obligations are discharged, cancelled or they expire.
Taxation
The tax currently payable is based on the taxable profit for the period. Taxable profit differs from net profit as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other periods and it further excludes items that are never taxable or deductible. The Company's liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting date.
Deferred income tax is provided for using the liability method on temporary differences at the reporting date between the tax basis of assets and liabilities and their carrying amounts for financial reporting purposes. Deferred income tax liabilities are recognised in full for all temporary differences. Deferred income tax assets are recognised for all deductible temporary differences carried forward of unused tax credits and unused tax losses to the extent that it is probable that taxable profits will be available against which the deductible temporary differences, and carry-forward of unused tax credits and unused losses can be utilised.
The carrying amount of deferred income tax assets is assessed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the deferred income tax asset to be utilised. Unrecognised deferred income tax assets are reassessed at each reporting date and are recognised to the extent that is probable that future taxable profits will allow the deferred income tax asset to be recovered.
Operating segments
The operating segments identifies based on internal reporting for decision-making. The Company is operated as one business with key decisions irrespective of the geography where work for clients is carried out. The Management (chief operating decision maker) considers that The Company has one operating segment.
Standards and interpretations issued but not yet applied
A number of new standards and amendments to standards and interpretations have been issued by International Accounting Standards Board but are not yet effective and in some cases have not yet been adopted. The Directors do not expect that the adoption of these standards will have a material impact on the financial statements of the Company in future periods.
ACCOUNTS BREAKDOWN AND NOTES
1. Other operating expenses
Expenses | All in GBP | 31 December 2022 |
| 31 December 2021 |
Brokerage fees | | - | | 21,511 |
Registrar & Depository Fees | | - | | 15,555 |
Directors' fees | | - | | 35,000 |
Regulatory charges | | - | | 21,177 |
Maintenance fee | | - | | - |
Secretarial fees | | - | | 4,056 |
Provision for audit fees | | - | | 14,000 |
Listing charges | | - | | 24,945 |
Office rental | | - | | 8,453 |
Loss on foreign exchange | | - | | - |
Penalty | | - | | 1,225 |
RTO expenses | | 209,909 | | 349 |
Bank charges | | 175 | | 349 |
Unrealised Currency Gains | | (119) | | 1,225 |
Total |
| 209,965 |
| 146,271 |
All expenses incurred during the reporting year were re-charged to Vox Capital Ltd as Reverse takeover (RTO) expenses
2. Income tax expense
The Company is regarded as resident for the tax purposes in Cayman Islands. No tax is applicable to the Company for the year ended 31 December 2022.
The Company has incurred indefinitely available tax losses of £1,359,678 (2021: £1,207,192) to carry forward against future taxable income. No deferred income tax asset has been recognised in respect of the losses carried forward, due to the uncertainty as to whether the Company will generate sufficient future profits in the foreseeable future to prudently justify this.
3. Investments in subsidiaries
As at the year ended 31 December 2022, the Company had the subsidiaries:
Subsidiary undertakings | Country of incorporation |
|
|
|
| | 31 December 2022 |
| 31 December 2021 |
Vertu Capital Holding Ltd. | United Kingdom | 100% | | - |
Vox Capital Pte | United Kingdom | 100% | | 100% |
Investment:
All in GBP | 31 December 2022 |
| 31 December 2021 |
Vertu Capital Holding Ltd. | 1 | | 1 |
Vox Capital Pte. | 26,442,750 | | - |
Total | 26,442,751 |
| 1 |
On 30 September 2022, the Company entered into a sale and purchase agreement with the Vox Sellers pursuant to which the Company agreed to acquire the entire issued share capital of Vox Capital Ltd for £26,442,749.57, it was satisfied by the issue of the Consideration Shares at the Issue Price. The Acquisition was constituted a reverse takeover for the purposes of Listing Rule 5.6.4 and therefore the Company has re applied for the admission of its Ordinary Share capital to the Standard Segment of the Official List and to trading on the Main Market.
Vox Capital Pte was incorporated on 7 May 2020 as a vehicle to consolidate businesses in the digital marketing, advertising and content sector. To date, Vox Capital has acquired a 100% interest in Mobio Global Limited (Mobio), a UK digital marketing company and has also acquired an equity interest in another trading business: Airnow PLC, a UK based app monetisation and marketing group.
4. Other receivables
All in GBP | 31 December 2022 |
| 31 December 2021 |
Other receivables | - | | 50 |
Prepayments | 5,336 | | 5,336 |
Total | 5,336 |
| 5,386 |
All of the trade receivables were non-interest bearing and receivable under normal commercial terms. The Directors consider that the carrying value of trade and other receivables approximates to their fair value.
Other receivables - related parties
All in GBP | 31 December 2022 |
| 31 December 2021 |
Vertu Capital Holdings Limited | 6,434 | | 165,030 |
Total | 6,434 |
| 165,030 |
5. Cash and cash equivalents
All in GBP | 31 December 2022 |
| 31 December 2021 |
Cash at bank | 145,564 | | 145,739 |
Total | 145,564 |
| 145,739 |
6. Other payables
All in GBP | 31 December 2022 |
| 31 December 2021 |
Non-trade creditors | 26,848 | | 26,848 |
Other creditors | 95,644 | | 45,159 |
Total | 122,492 |
| 72,007 |
The fair value of trade and other payables approximates to book value at each year end. Trade payables are non-interest bearing and are normally settled monthly.
7. Financial instruments
The Company's financial instruments may be analysed as follows:
Financial assets | 31 December 2022 |
| 31 December 2021 |
Financial assets measured at amortised cost: | All in GBP | | All in GBP |
Cash at bank | 145,564 | | 145,739 |
Other receivables | 5,336 | | 5,386 |
Total | 150,900 |
| 151,125 |
Financial liabilities | 31 December 2022 | | 31 December 2021 |
Financial liabilities measured at amortised cost: | All in GBP | | All in GBP |
Other payables | 122,492 | | 72,007 |
Total | 122,492 |
| 72,007 |
The Company's income, expense, gains and losses in respect of financial assets measured at fair value through profit or loss realised fair value gains of nil (2021: nil).
8. Financial risk management
The Company is exposed to a variety of financial risks through its use of financial instruments which result from its operating activities. All the Company's financial instruments are classified trade and other receivables. The Company does not actively engage in the trading of financial assets for speculative purposes. The most significant financial risks to which the Company is exposed are described below:
Credit risk
The Company's credit risk is primarily attributable to deposits with banks. The Company manages its deposits with banks or financial institutions by monitoring credit ratings and limiting the aggregate risk to any individual counterparty. The Company's exposure to credit risk on cash and cash equivalents is considered low as the bank accounts are with banks with high credit ratings.
Liquidity risk
Liquidity risk is the situation where the Company may encounter difficulty in meeting its obligations associated with its financial liabilities. The Company seeks to manage financial risks to ensure sufficient liquidity is available to meet any foreseeable needs and to invest cash assets safely and profitably.
Interest rate risk
The Company is not exposed to material interest rate risk as its liabilities are either non-interest bearing or subject to fixed interest rates.
Reputational risks
The Management of the Company believes that at present there are no facts that could have a significant negative impact on the decrease in the number of its customers due to a negative perception of the quality of services provided, adherence to the terms of rendering services, as well as the participation of The Company in any price agreement. Accordingly, reputational risks are assessed by the Company as insignificant.
Fair value of financial instruments
The fair values of all financial assets and liabilities approximates their carrying value.
Country risks
4 February 2022 Russia declared a war operation in Ukraine and launched full-scale military invasion, multilateral sanctions and restrictions were imposed on work with certain Russian legal entities and individuals. These circumstances caused unpredictable volatility in the stock and currency markets, in energy prices, general price level, the Bank of Russia's key interest rate and restrictions on flow of certain groups of goods. It is expected that these events may affect the business of companies in various countries and industries.
One of the Directors of the Company is a citizen of the Russian Federation. He is not subject to the sanctions imposed by the United Kingdom and other countries. The Company does not provide to and receive services from Russian companies.
The Management analyzes the current situation and possible solutions. At present, the duration of these events cannot be predicted and their impact on the future financial position and performance of the Company cannot be reliably assessed.
Other risks
The industry risk is currently assessed as low, and the volume of advertising on the Internet is growing. However, it should be taken into consideration that the industry is affected by changing legislation on the regulation of the advertising services provision and compliance with information security of data. Also, The Company business depends on the availability, performance and reliability of internet, mobile and other infrastructures (speed, data capacity and security) that are not under The Company control.
The Company makes every effort to comply with the requirements of the legislation and to maintenance of a reliability for providing advertising internet services.
9. Related parties transactions
Parties are generally considered to be related if one party has the ability to control the other party or can exercise significant influence in making financial and operational decisions.
The related parties of The Company are:
· Petrus Cornelis Johannes Van Der Pijl - the ultimate beneficiary
· Stefans Keiss - the ultimate beneficiary
· Sergey Konovalov - the ultimate beneficiary
· Vox Valor Holding LTD
· Vertu Capital Holding LTD
· Vox Capital Plc
· Mobio Global LTD
· Mobio (Singapore) Pte LTD
· Mobio Global Inc.
· Vox Valor Capital Pte LTD
· Initium HK LTD
· Airnow Plc
Transactions with related parties
Other receivables - related parties
All in GBP | 31 December 2022 |
| 31 December 2021 |
Vertu Capital Holdings Limited | 6,434 | | 165,030 |
Total | 6,434 |
| 165,030 |
10. Share capital
All in GBP | Number of shares |
| Share capital |
As at 31 December 2021 | 143,999,998 | | 1,440,000 |
Additional | - | | - |
As at 31 December 2021 | 143,999,998 |
| 1,440,000 |
11. Consideration Shares
On 30 September 2022, the Company entered into a sale and purchase agreement with the Vox Sellers pursuant to which the Company agreed to acquire the entire issued share capital of Vox Capital Ltd (Vox Capital) for £26,442,749.57, it was satisfied by the issue of the Consideration Shares at the Issue Price 1,2p.
12. Capital management
The Company's objectives when managing capital are to:
- Safeguard their ability to continue as a going concern, so that they can continue to provide returns to shareholders and benefits for other stakeholders, and
- Maintain an optimal capital structure to reduce the cost of capital.
In order to maintain or adjust the capital structure, The Company may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.
13. Events after the reporting date
On 23 February 2023, Vertu Capital Holding Ltd. (UK) was disposed.
In the period between the reporting date and the date of signing the financial statements for the reporting year, there were no other facts of economic activity that could have an impact on the financial condition, cash flow or performance of the organization and which should be reflected.
The Company intends to expand its presence in the international advertising market in the coming years.
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