RNS Number : 7833H
Amala Foods PLC
31 July 2023
 

Amala Foods Plc

("Amala" or the "Company")

 

Annual Financial Report 2023

 

Amala Foods Plc (LON: DISH), a cash shell company, is pleased to announce the publication of the Annual Financial Report for the Year Ended 31 March 2023 which is below this announcement.  The Annual Report will also shortly be available via the National Storage Mechanism.

--

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF THE MARKET ABUSE REGULATION EU 596/2014 ("MAR").

 

 

Enquiries:

 

Jonathan Morley-Kirk, Non-Executive Chairman

jmk@bluebirdmv.com

 

           

 

 

 

 

 

 

 

 

Amala Foods PLC

 

 

 

 

Annual Financial Report

 

2023

 

 

 

 

 

 

 

 

COMPANY INFORMATION

 

Directors                                                              Aidan Bishop                                        Executive Director                              

                                                                                Jonathan Morley-Kirk                         Non-executive Chairman

                                                                                Celia Li                                                  Non-executive Director

                               

Company Secretary                                          Roger Matthews                                  

                                                                               

 

Registered office of the Company                 Pigneaux Farmhouse

Pigneaux Farm

Princes Tower Road

St Saviour JE2 7UD

Jersey

 

 

Independent Auditor                                          PKF Littlejohn LLP

                                                                                15 Westferry Circus

Canary Wharf

London E14 4HD               

               

Bankers                                                                                eWealthGlobal Group Limited

                                                                                17 Broad St

St Helier

Jersey JE2 3RR                                  

Strategic Report

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The Company is a cash shell and as such is seeking to identify a transaction that will lead to a reverse takeover.

 

During the year the Company entered into a Share Purchase Agreement (SPA) with Terra Rara UK Ltd, a mining company, that could have led to a transaction that would have been considered a Reverse Takeover.  Terra Rara UK Ltd held Rare Earth Elements (REE) exploration assets via two subsidiaries in Angola and Uganda.  These exploration assets are located in close proximity to advanced stage REE exploration assets held by other mining companies.  The Company intended to acquire 100% of the share capital of Terra Rara UK Ltd subject to regulatory approvals.  The listing was suspended on 23 May 2022.  The Company announced the termination of the proposed transaction with Terra Rara UK Ltd on 17 March 2023. 

 

The Directors have agreed to not receiving any remuneration for the period prior to and during the period of suspension and until a successful transaction reaches the stage of a Reverse Takeover, upon which GBP 125,000 will be issued to the Directors in equity at the readmission price.

 

The Company raised GBP 405,000 in convertible loan notes during the year ended 31 March 2023 (refer note 12 of the audited financial statements).

 

Ms Celia Li was appointed to the Board as a Non-Executive Director on 17 March 2023. 

 

It is my sincere hope that after a challenging couple of the years, that a path to generate value for shareholders will be realised. 

 

 

Jonathan Morley-Kirk

Chairman

31 July 2023

 

are negligible and it is not practical to be able to accurately measure the entity's emissions and energy usage

18 of the audited accounts

as completion of a reverse takeover by the required dates and thus avoiding cash repayment of the convertible loan notes is not guaranteed and given the requirement to raise further funds in such an event, next 12 months, they acknowledge that a material uncertainty relating to going concern exists.

The accounts have therefore been prepared on a going concern basis. The auditors make reference to going concern by way of a material uncertainty within their audit report.

The principal business risks that have been identified are as below.

 

Transaction Risk

 

There is no guarantee that a suitable transaction will be identified and will be successfully completed, resulting in a Reverse Takeover. Even if a transaction is successful, there is no guarantee that the Directors will be successful in managing the new business and derive the value that is hoped.  Should a transaction not complete, once identified, then the Directors will need to invest further time and resources in identifying another suitable target company.

 

Funding Risk

 

The Company has not yet achieved profitability and is therefore reliant on periodically raising finance to fund its expenditure. There can be no guarantees that additional capital will be available when required

 

Key Personnel Risk

 

The Company is dependent on the experience and abilities of its Directors. Whilst the Company does not expect any of the Directors to leave the Company, if such individuals were to leave the Company, and the Company was unable to attract suitable experienced personnel, it could have a negative impact on the future prospects of the Company

 

There is no applicable regime of corporate governance to which the directors of a Jersey company must adhere over and above the general fiduciary duties and duties of care, skill and diligence imposed on such directors under Jersey law. As a Jersey company and a company with a Standard Listing, the Company is not required to comply with the provisions of the UK Corporate Governance Code.

The Directors acknowledge they are responsible for the Company's system of internal control and for reviewing the effectiveness of these systems. The risk management process and systems of internal control are designed to manage rather than eliminate the risk of the Company failing to achieve its strategic objectives. It should be recognised that such systems can only provide reasonable and not absolute assurance against material misstatement or loss. The Company has well established procedures which are considered adequate given the size of the business.

 

The Company has established an Audit Committee with delegated duties and responsibilities. The Audit Committee is responsible, amongst other things, for making recommendations to the Board on the appointment of auditors and the audit fee, monitoring and reviewing the integrity of the Company's accounts and any formal announcements on the Company's financial

ü

The Board sets the Company's strategy, ensuring that the necessary resources are in place to achieve the agreed strategic priorities, and reviews management and financial performance. It is accountable to shareholders for the creation and delivery of strong, sustainable financial performance and monitoring the Company's affairs within a framework of controls which enable risk to be assessed and managed effectively. The Board also has responsibility for setting the Company's core values and standards of business conduct and for ensuring that these, together with the Company's obligations to its stakeholders, are widely understood throughout the Company.

 

The remuneration of the Executive Director is fixed by the Remuneration Committee, which comprises of the Non-Executive Directors. The Remuneration Committee is responsible for reviewing and determining the Company policy on executive remuneration and the allocation of long-term incentives to executives and employees. The remuneration of Non-Executive Directors is determined by the Board. In setting remuneration levels, the Company seeks to provide appropriate reward for the skill and time commitment required in order to retain the right caliber of Director at an appropriate cost to the Company.

, which is on the successful Reverse Takeover.

 

 

 

31 Mar 2023

(GBP)

31 Mar 2022

(GBP)



Aidan Bishop

100,000

120,000



Jonathan Morley-Kirk

25,000

20,000

Celia Li

-

-

125,000

140,000

 

in the Company . Jonathan Morley-Kirk held no shares in the Company at 31 March 2023 and 31 March 2022.

Jonathan Morley-Kirk held no share options at 31 March 2023 (444,444 at 31 March 2022). The Directors agreed in the period ended 31 March 2023 to cancel their outstanding options.

).

 

Number

%

 

  *  Includes 55,018,687 shares held by Monza Capital Ventures Limited, which is associated with Aidan Bishop. Monza Capital Ventures Limited continued to hold 55,018,687 shares at the date of this Annual Report.

 

·   

·   

·   

The Company's auditor, PKF Littlejohn LLP, was initially appointed on 23 March 2020. It is proposed by the Board that they be reappointed as auditors at the forthcoming AGM. The auditors have expressed their willingness to continue in oce.

·    consistently select and apply appropriate accounting policies;

·    present information, including accounting policies, in a manner that provides relevant, reliable, comparable and understandable information;

·    make judgements and accounting estimates that are reasonable and prudent;

·    provide additional disclosures when compliance with the specific requirements in UK-adopted IAS

·    state that the Company has complied with

·    prepare the accounts on the going concern basis unless it is inappropriate to presume that the

effective anti-corruption and anti-bribery policies are observed.

 

Legislation in Jersey governing the preparation and dissemination of accounts may differ from legislation in other jurisdictions.

·      

·      

 

This Directors' Report was approved by the Board of Directors on 31 July 2023 and is signed on its behalf.

 

By Order of the Board

 

 

 

 

 

Jonathan Morley-Kirk

Chairman

31 July 2023

 

 

Key Performance Indicators

 

The Company intends to identify a suitable target company with the aim of entering into a transaction, resulting in a Reverse Takeover.  Whilst the Directors had expected that the proposed transaction with Terra Rara UK Ltd would have achieved this objective the potential transaction was terminated.  The Directors will seek to identify other suitable target companies that could be in any sector and once identified will undertake a due diligence process.

 

 

 

 

 

Aidan Bishop

Executive Director

31 July 2023

·     

·     

·     

·      challenging the directors' going concern assessment and the key underlying assumptions and inputs;

·      assessing the likelihood of a Reverse Takeover completing within the next 12 months;

·      ascertaining the company's latest financial position by reviewing relevant financial documents and its committed costs over the next 12 months from the date of signing financial statements; and

·      agreeing the terms of the convertible loan notes in issue at the date of this report to the going concern assessment.

Key Audit Matter

How our scope addressed this matter

Carrying value of loan receivables

required to be recognised.

.

·   

·   

·   

·   

·     

received from branches not visited by us; or

·     

·     

·     

·     

·     

·     

·     

www.frc.org.uk/auditorsresponsibilities

The accompanying accounting policies and notes form an integral part of these accounts.

                                                                                                                                (896,762)              (598,127)

Jonathan Morley-Kirk

Chairman

31 July 2023

Note               GBP            GBP                    GBP                        GBP

The accompanying accounting policies and notes form an integral part of these accounts.

 

The accompanying accounting policies and notes form an integral part of these accounts.



1. GENERAL INFORMATION

 

Amala Foods Plc ('Company') is a public company limited by shares. It was incorporated on 11 April 2016 and is registered (registered number 121041) and domiciled in Jersey. The Company's ordinary shares are on the Official List of the UK Listing Authority in the standard listing section of the London Stock Exchange (reference DISH).

 

 

2. BASIS OF PREPARATION AND ADOPTION OF INTERNATIONAL FINANCIAL REPORTING STANDARDS (IFRS)

 

The Company's accounts have been prepared in accordance with UK-adopted International Accounting Standards at 31 March 2023.

 

The accounts are prepared under the historical cost convention unless otherwise stated in the accounting policies.

 

The accounts are presented in GB Pounds ('GBP'), which is the functional currency of the Company and are rounded to the nearest pound.

 

Certain amounts included in the accounts involve the use of judgement and/or estimation. Judgements, estimations and sources of estimation uncertainty are discussed in note 3.

 

2.1 In issue and effective for periods commencing on 01 April 2022

 

The International Accounting Standards Board (IASB) issued various amendments and revisions to International Financial Reporting Standards and IFRIC interpretations. The amendments and revisions were applicable for the period ended 31 March 2023 but did not result in any material changes to the financial statements of the Company.

 

Of the other IFRS and IFRIC amendments, none are expected to have a material effect on the future Company Financial Statements.

 

2.2 Standards in issue but not yet effective

 

At the date of approval of these financial statements, the following standards and interpretations which have not been applied in these financial statements were in issue but not effective:

 

Standard

Impact on initial application

Effective date

Annual improvements

2018-2020 Cycle

01 January 2023

IAS 1

Classification of current liabilities

01 January 2023

IAS8

Accounting estimates

01 January 2023

IASA12

Deferred tax arising form a single transaction

01 January 2023

 

 

, but as completion of a reverse takeover by the required dates and thus avoiding cash repayment of the convertible loan notes is not guaranteed and given the requirement to raise further funds in such an event within the next 12 months, they acknowledge that a material uncertainty relating to going concern exists.

The accounts have therefore been prepared on a going concern basis.

 

3. JUDGEMENTS IN APPLYING ACCOUNTING POLICIES AND SOURCES OF ESTIMATION UNCERTAINTY

 

Certain amounts included in the accounts involve the use of judgement and/or estimation. These are based on management's best knowledge of the relevant facts and circumstances, having regard to prior experience. However, judgements and estimations regarding the future are a key source of uncertainty and actual results may differ from the amounts included in the accounts. Information about judgements and estimation is contained in the accounting policies and/or other notes to the accounts. The key areas are summarised below.

 

3.1 Share based payments

 

3.2 Recoverable value of loan receivable

 

The amounts advanced to Terra Rara UK Ltd have been classified as a loan receivable under IFRS 9 and therefore the Directors have had to consider the recoverable value of this balance by applying the expect credit loss approach. When applying this approach, the Directors have been required to make judgements regarding the likelihood of the recovery of the balance. The Directors have assessed that in the short time period since the year-end, no events or developments have been noted to suggest that the likelihood of recovery decreased in this period and therefore the Directors have assessed the balance to be fully recoverable. The Directors of the Company are in contact with the management of Terra Rara UK Ltd and are aware of the efforts being made to repay the loan and financing options being discussed, thus they are confident that the loan advanced to Terra Rara UK Ltd will be recovered during the next financial year. The Directors will continue to monitor the situation closely and reassess the recoverability of the loan as new information becomes available.

 

 

3.3 Post year-end settlement of convertible loan notes

 

The convertible loan notes issued prior to 31 March 2023 are due for repayment in cash within 12 months of the approval date of these financial statements should a Reverse Takeover not take place by the dates noted within the underlying agreements.

 

Should the Reverse Takeover not take place by the specified dates, the Directors have made the judgement that the Company would be able to settle the convertible loan notes in cash by deferring payment until such a point that they were able to raise the requisite funds.

ACCOUNTING POLICIES

 

The principal accounting policies are as determined below.

 

4.1 Financial assets

 

 

 

4.2 Foreign currency translation

 

Functional and presentational currency

 

The functional currency of the Company is GBP in the reporting period as it is the currency which most affects each company's revenue, costs and financing. The Company's presentation currency is the GBP.

 

Transactions and balances

 

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions, and from the translation at reporting period end exchange rates of monetary assets and liabilities denominated in foreign currencies, are recognised in the income statement.

 

4.3 Cash and cash equivalents

 

Cash and cash equivalents are defined as cash on hand, demand deposits and short term highly liquid investments and are measured at cost which is deemed to be fair value as they have short-term maturities.

 

4.4 Financial liabilities

 

Financial liabilities include convertible loans and trade and other payables. In the statement of financial position these items are included within Current liabilities. Financial liabilities are recognised when the Company becomes a party to the contractual agreements giving rise to the liability. Interest related charges are recognised as an expense in Finance costs in the income statement unless they meet the criteria of being attributable to the funding of construction of a qualifying asset, in which case the finance costs are capitalised.

 

Trade and other payables and convertible loans are recognised initially at their fair value and subsequently measured at amortised costs using the effective interest rate, less settlement payments.  Convertible loans issued in the year are classified as a financial liability as there is a contractual obligation to pay cash that the issuer cannot avoid, the exceptions in IAS 32.16A-D are not met and it is not a derivative.

 

 

4.5 Income taxes

 

Current income tax liabilities comprise those obligations to fiscal authorities in the countries in which the Company carries out operations and where it generates its profits. They are calculated according to the tax rates and tax laws applicable to the financial period and the country to which they relate. All changes to current tax assets and liabilities are recognised as a component of the tax charge in the income statement.

 

Deferred income taxes are calculated using the liability method on temporary differences. This involves the comparison of the carrying amount of assets and liabilities in the consolidated accounts with their respective tax bases. However, deferred tax is not provided on the initial recognition of goodwill, nor on the initial recognition of an asset or liability unless the related transaction is a business combination or affects taxes or accounting profit.

 

Deferred tax liabilities are provided for in full. Deferred tax assets are recognised when there is sufficient probability of utilisation. Deferred tax assets and liabilities are calculated at tax rates that are expected to apply to their respective period of realisation, provided they are enacted or substantively enacted at the balance sheet date.

 

4.6 Segmental Reporting

 

).

 

 

Where the Company has a contractual right to issue a fixed number of shares to settle a fixed liability it recognises unissued share capital pending the issue of shares.

 

Treasury shares are held by the Company at no par value and are adjusted through share capital for receipts and disbursements.

 

4.8 Provisions, contingent liabilities and contingent assets

 

 

 

The calculation of the fair value of equity-settled share-based awards requires assumptions to be made regarding future events and market conditions. These assumptions include the future volatility of the Company's share price. These assumptions are then applied to a recognised valuation model in order to calculate the fair value of the awards.

 

Where employees, directors or advisers are rewarded using share-based payments, the fair value of the employees', directors' or advisers' services are determined by reference to the fair value of the share options/warrants awarded. Their value is appraised at the date of grant and excludes the impact of any non-market vesting conditions (for example, profitability and sales growth targets). In some instances, warrants issued in association with the issue of Convertible Loan Notes also represent share-based payments and a share-based payment charge is calculated for these instruments.

 

In accordance with IFRS 2, a charge is made to the statement of comprehensive income for all share-based payments including share options based upon the fair value of the instrument used. A corresponding credit is made to other reserves, in the case of options/warrants awarded to employees, directors, advisers and other consultants.

 

If service conditions or other vesting conditions apply, the expense is allocated over the vesting period, based on the best available estimate of the number of share options/warrants expected to vest. Non-market vesting conditions are included in assumptions of the number of options / warrants that are expected to become exercisable, and hence reflected in the share-based payment charge.

 

Estimates are subsequently revised, if there is any indication that the number of share options/warrants expected to vest differs from previous estimates. No adjustment is made to the expense or share issue cost recognised in prior periods if the number of share options ultimately vest differs from previous estimates.

 

Upon exercise of share options, the proceeds received, net of any directly attributable transaction costs, up to the nominal value of the shares issued, are allocated to share capital.

 

Where share options are cancelled, this is treated as an acceleration of the vesting period of the options. The amount that otherwise would have been recognised for services received over the remainder of the vesting period is recognised immediately within the Statement of Comprehensive Income.

 

 

 

5. SEGMENTAL REPORTING 

6. LOSS FOR THE PERIOD BEFORE TAX

 

                                                                                                                                                                31 Mar 2023         31 Mar 2022

                                                                                                                                                                GBP                        GBP

 

 

Loss for the period has been arrived at after charging:

                                                                                                               

Auditors remuneration                                                                                                                      37,400                   34,000  

Directors remuneration                                                                                                                      125,000*               140,000

Share based payments expense                                                                                     `               16,441                   332,232

Write off of prepaid consideration to AFI                                                                                        -                               204,656

 

* Stock award contingent on a successful Reverse takeover, upon which this will be issued in equity

 

 

7. REMUNERATION

 

7.1 Remuneration of Management Personnel and Employees

 

In accordance with IAS 24 - Related party transactions, all Executive and Non-executive Directors, who are the Company's key management personnel, are those persons having authority and responsibility for planning, directing and controlling the activities of the Company. Details of Directors Remuneration is outlined in the Report of the Directors.

 

                                                                                                                                                31 Mar 2023         31 Mar 2022

GBP                        GBP

 

 

Directors emoluments during the period                                                                        125,000                 140,000

 

 

 

Remuneration of GBP 23,000 was paid in the year ended 31 March 2022. The balances due at 31 March 2022 were transferred to Shares to be issued reserve through the Company's salary sacrifice scheme.

 

The Directors have agreed to waive the right to receive or accrue any and all outstanding remuneration or any unissued equity prior to the completion of a successful reverse takeover. The GBP 125,000 shown in the year ended 31 March 2023 is a stock award contingent on a successful Reverse takeover, upon which this will be issued in equity at the readmission price.

 

7.2 Average Number of Employees

 

The average number of Employees during the period was made up as follows:


31 Mar 2023

 

31 Mar 2022

 

 

Directors

 

2

 

2

 

Average during the period              

 

2

 

2

 

 

 

 



 

8. TAXATION

 

 

The Company is taxed at the standard rate of income tax for Jersey companies which is 0%. Taxation for other jurisdictions is calculated at the rates prevailing in the respective jurisdictions.

 

 

31 Mar 2023

GBP

 

31 Mar 2022

GBP

Current tax charge

-

-

Deferred tax charge

Total tax charge

-

-

-

-

 

The tax charge for the period can be reconciled to the loss per the income statement as follows:

 

 

31 Mar 2023

GBP

 

31 Mar 2022

GBP

Loss before taxation

(440,076)

(1,090,841)

Jersey Corporation Tax at 0%

 

-

-

Total tax charge *

-

-

* No deferred tax asset has been recognised as jersey having a 0% corporation tax, which means the there are no unutilised tax losses

 

 

9. INVESTMENTS & IMPAIRMENTS

 

 

In the year ended 31 March 2022, the Company entered into a joint venture agreement with Amala Foods Inc ('AFI'), advancing GBP 204,656 (USD 227,488) This agreement stated that up to 70% of the share capital of AFI could be purchased by the Company for consideration of USD 1,000,000 but USD 333,333 was required to be advanced by the Company before they would be entitled to receive any shares in AFI. It also stated that if the Company decided not to advance funds equal to or exceeding that threshold then those funds advanced would not be reimbursed to the Company.

 

As at the year ended 31 March 2022, this threshold had not been met and the Directors did not intend to advance any further funds to AFI post year-end due to signing a term sheet with Terra Rara UK Ltd. This set the Company on a path to a new strategic direction that resulted in the signing of a Share Purchase Agreement. That led to the suspension of the Company's listing in order for a regulatory process to commence that if successful would have resulted in a Reverse Takeover. One of the conditions precedent to the Share Purchase Agreement was that the Company should have no interest in AFI.  The Directors assessed therefore that this prepaid consideration was not recoverable and therefore impaired the balance in full.

 

The changes in business structure have generated the following impairment losses:

 

 

31 Mar 2023

GBP

 

31 Mar 2022

GBP

 

Write off of prepaid consideration - AFI

 

 

-

 

204,656

Total impairment

-

204,656

 

 



 

10. TRADE AND OTHER RECEIVABLES

                                                                                                                                                                               

31 Mar 2023         31 Mar 2022

                                                                                                                                                GBP                        GBP

 

 

Loan Receivables               *                                                                                                              101,189                 94,675

 

 

Balance at end of period                                                                                                  114,675                 94,675

 

 

 

11. CASH AND CASH EQUIVALENTS

                                                                                                                                                                               

31 Mar 2023         31 Mar 2022

                                                                                                                                                GBP                        GBP

 

 

Cash at Bank                                                                                                                     318,217                 19,867

 

 

 

12. TRADE AND OTHER PAYABLES

 

Current Liabilities

                                                                                31 Mar 2023                31 Mar 2022

                                                                                                                                                GBP                        GBP

 

 

Trade payables                                                                                                                    83,109                   27,243

Accruals                                                                                                                                                60,340                   57,889

Borrowings*                                                                                                                          1,172,719              627,537

 

Balance at end of period                                                                                                  1,316,168              712,669

 

 

The borrowings of GBP 787,719 are a short-term loan to be used for working capital purposes with an interest rate of 7.5%. The repayment terms were negotiated and extended to Q1 2022. The Company drew down GBP 250,000 against the loan in the year ended 31 March 2022 and recognised GBP 177,537 of loan re-negotiation and interest chargers in the year. 9,728,720 warrants were issued during the year ended 31 March 2021 in relation to the loan and re-negotiated in the year ended 31 March 2022 (refer note 17 of the audited ). The share based payment of GBP 304,438 related to the loan and the issue of 43,478,260 warrants at 1.15p with an expiry date of 16 July 2015 are detailed in note 17 of the audited financial statements . The repayment terms were further negotiated in the year ended 31 March 2023 to reprofile outstanding debt on the basis that no interest will be accrued until a successful reverse takeover at which time the debt will be reduced to . No additional warrants were issued to the convertible loan note holders as a result of the renegotiated repayment terms.

 

 



 

13. FINANCIAL INSTRUMENTS

 

13.1 Financial Assets at amortised cost

                                                                                                                                                31 Mar 2023         31 Mar 2022

                                                                                                                                                GBP                        GBP

 

 

Trade and other receivables                                                                                             101,189                 94,675

Cash and cash equivalents                                                                                               318,217                 19,867

 

 

Balance at end of period                                                                                                  419,406                 114,542

 

 

31 Mar 2023         31 Mar 2022

                                                                                                                                                GBP                        GBP

 

 

Current liabilities - trade payables and accruals                                                          143,449                 85,132  

Current liabilities - loans                                                                                                   1,172,719              627,537

               

 

Balance at end of period                                                                                                  1,316,168              712,669

 

 

 

13.3 Liquidity Risk

 

The Company monitors constantly the cash outflows from day to day business and monitors long term liabilities to ensure that liquidity is maintained.

 

 

At the balance date the Company does not have any long-term variable rate borrowings. The Directors do not consider the impact of possible interest rate changes based on current market conditions to be material to the net result for the year or the equity position at the year ended 31 March 2023 or the period ended 31 March 2022.

 

The Company is infrequently exposed to transaction foreign exchange risk due to transactions not being matched in the same currency. This is managed, where possible and material, by the Company retaining monies received in base currencies in order to pay for expected liabilities in that base currency. The Company currently has no currency hedging in place.

 

The Directors do not consider the impact of possible foreign exchange fluctuations to be material to the net result for the year or the equity position at the year-end for either the year ended 31 March 2023 or period ended 31 March 2022.

 

 

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in a financial loss to the Company. In order to minimise this risk, the Company endeavours only to deal with companies which are demonstrably creditworthy and this, together with the aggregate financial exposure, is continuously monitored. The maximum exposure to credit risk is the value of the outstanding amounts as follows:

 

                                                                                                                                                31 Mar 2023         31 Mar 2022

                                                                                                                                                GBP                        GBP

 

 

Trade and other receivables                                                                                             101,189*               94,675*

Cash and cash equivalents                                                                                               318,217                 19,867

 

 

* Equates to USD 125,000

 

Credit risk on cash and cash equivalents is considered to be acceptable as the counterparties are substantial banks with high credit ratings. All receivables are current assets and due within 12 months. The Company has assessed the expected credit losses as GBP Nil for the years ended 31 March 2023 and 2022.

 

 

For the purposes of the Company's capital management, capital includes called up share capital, share-based payments for options, share-based payments for warrants and equity reserves attributable to the equity holders of the Company as reflected in the Statement of Financial Position.

 

The Company's capital management objectives are to ensure that the Company's ability to continue as a going concern, and to provide an adequate return to shareholders.

 

The Company manages the capital structure through a process of constant review and makes adjustments to it in the light of changes in economic conditions and the risk characteristics of the underlying assets. In order to maintain or adjust the capital structure, the Company may issue new shares, adjust dividends paid to shareholders, return capital to shareholders, or seek additional debt finance.

 

The nature of the Company's equity reserves are:

 

·    Reserves - including warrants, options and shares to be issued reserves related to the value of equity that investors have secured as part of their funding provided to the Company and that management has agreed to issue for settlement of remuneration;

·    Share Capital - represents the nominal value of shares issued;

·    Unissued Share Capital - reflects the value of equity that management has agreed to issue for settlement of remuneration, liabilities and funding provided; and

·    Accumulated losses - comprise the Company's cumulative accounting profits and losses since inception.

 

14.1 Reserves

 

31 Mar 2023

GBP

31 Mar 2022

GBP

                               

 

Share options reserve

Warrants reserve

Shares to be issued reserve

 

 

-

381,159

279,939

 

977,617

381,159

355,939

 

Balance at end of period

 

661,098

 

1,714,715

 

 

 

15. SHARE CAPITAL

 

15.1 Share Capital

                                                                                                31 Mar 2023                                         31 Mar 2022

                                                                                                Number*                               GBP                        Number*                               GBP

 

 

Opening balance                                                                 443,620,823         6,488,490              373,620,823         6,455,154

Ordinary shares - new shares issued during                                -                               -                               70,000,000           210,000

the period

Other adjustment**                                                             -                               -                               -                               (176,664)

 

 

Balance at end of period                                                  443,620,823         6,488,490              443,620,823         6,488,490

 

 

*  Number of shares issued and fully paid

** Reflects changes to treasury shares in the year ended 31 March 2022 - including the receipt of 3,700,000 shares in settlement of the outstanding loan, the issuance of 2,332,617 to settle unissued shares at 31 March 2021 and the issuance of 4,760,000 shares to settle liabilities incurred in the year ended 31 March 2022.

 

At 31 March 2022 and 31 March 2023 the Company held 19,607,383 treasury shares.



15.2 Earnings Per Share

 

 31 Mar 2023

       GBP

31 Mar 2022

GBP

 

 

Basic and diluted earnings per share (GBP)

 

        (0.00010)

 

(0.0028)

Loss used to calculate basic and diluted earnings per share

        (440,076)

(1,090,841)

Weighted average number of shares used in calculating basic and diluted earnings per share

 

        443,620,823

395,483,837

 

16. RELATED PARTY TRANSACTIONS

                                                                                                                                                               

The Company owes GBP Nil to Aidan Bishop at 31 March 2023 (2022 - GBP 166,000). The Company owes GBP Nil to Jonathan Morley-Kirk at 31 March 2023 (2022 - GBP 35,000). The Directors have agreed to not receive any remuneration due and will not receive any further remuneration until a Reverse Takeover is achieved - in lieu of GBP 125,000 stock award contingent on completion of the transaction.

 

Aidan Bishop agreed to a GBP 40,000 Convertible Loan Note in the year ended 31 March 2023 as part of the GBP 405,000 of Convertible Loan Notes, of which GBP 20,000 was received by the Company at 31 March 2023 as agreed, to fund a transaction leading to a Reverse Takeover.

 

17. SHARE OPTIONS AND WARRANTS

 

 

Warrants are denominated in Sterling and are issued for services provided to the Company or as part of the acquisition of a subsidiary.

 

In the year ended 31 March 2023 the Company recognised no Share Based Payments expenses in respect of warrants (31 March 2021, GBP 304,348).

 

In the year ended 31 March 2022, the Company issued 43,478,260 warrants at an exercise price of 1.15p

 

 

 

Exercise price

 

No. issued

 

No. exercised

 

No. lapsed or re-negotiated

No. outstanding and exercisable

 

Expiry date

Issued in the year

ended 31 Mar 2021

1.35p

4,324,320

-

-

4,324,320

19 October 2023

1.10p

5,404,400

-

-

5,404,400

19 November 2023

Issued in the year

ended 31 Mar 2022






1.15p

43,478,260

-

-

43,478,260

16 July 2025

Balance at end of period

53,206,980

-

-

53,206,980

 



 

 

17.2 Share Options

 

On 31 July 2018 and 19 February 2019 share options were granted by the Company to an employee, non-executive directors, executive directors and senior managers within the Company. The details of the Options are outlined in detail in the Company's Annual Financial Report to 31 March 2021.

 

Under the provisions of IFRS 2 a charge is recognised for those share options and awards under the share plan issued. The estimate of the fair value of the services received is measured based on the Black-Scholes model for share options granted under the executive and discretionary share option schemes.

 

The Company recognised a GBP 16,441 share based payments charge on the year ended 31 March 2023 in respect of options issued in previous periods (2022, GBP 27,884).

 

Each of the Options noted above have been cancelled or lapsed during the year ended 31 March 2023.

 

 

17.3 Share Awards

 

In the period ended 31 March 2019, the Company entered into an agreement with a number of employees to issue a total of 599,156 shares at a price equal to the admission price in two years' time should the employees in questions still be employed by the Company.

 

Although due, the shares had not been issued to those employees as at 31 March 2023 and 31 March 2022 and thus the fair value of these share awards is included within other reserves.

 

In the year ended 31 March 2023 former employees and current directors waived their rights to awards and options as a facilitator to the planned reverse takeover.


 

 

18. EVENTS AFTER THE REPORTING PERIOD

 

Segment to the Main Market.

a price of GBP 0.00344 per share to a creditor to reduce outstanding liabilities by GBP 80,150

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