TIDMEVST
The Board of Everest is pleased to announce its unaudited results for the six
months ended 30 April 2023.
31 July
2023
Everest Global plc
("Everest" or the "Company")
Unaudited interim results for the six months ended 30 April 2023
The Board of Everest is pleased to announce its unaudited results for the six
months ended 30 April 2023.
Chief Executive Officer's Report
I am pleased to report our unaudited results for the six months ended 30 April
2023.
To repeat for those new to the Company, on 3 October 2022, prior to the previous
year-end, the Company announced a number of important events including the
recapitalisation of the Company through a subscription by Golden Nice
International Limited of 13 million new Ordinary Shares in the Company for
£650,000 and its purchase of 65% of the outstanding convertible loan notes,
with the remainder of the convertible loan notes (35%) being converted by the
note holders into Ordinary Shares in the Company.. The Company also changed its
name to Everest Global Plc, both Andrew Monk and Matt Bonner resigned from the
Board and Simon Grant-Rennick and I were appointed to the Board. .
During the current reporting period, on the 24 January 2023, the Company
announced a subscription for 12,726,000 new Ordinary Shares raising net proceeds
totalling £699,930 at a subscription price of 5.5 pence per Ordinary Share. In
addition, on 25 January 2023, the convertible loan note holder, Golden Nice
International Limited converted £300,000 of its debt to 6,000,000 new Ordinary
Shares.
Due to the number of new shares issued in the period under review and on 3
October 2022, in order to comply with Prospectus Regulation Rule 1.2.4, which
prohibits the admission of more than 20% of the number of securities already
admitted to trading on the Main Market of the London Stock Exchange without a
prospectus, the Company is working towards publishing a prospectus in relation
to the issue of the these shares, by 2 October 2023, in order to enable them to
be admitted to trading on the Main Market of the London Stock Exchange in
accordance with Listing Rule 14.3.4.
This has been the first reporting period that the Company is operating as
Everest Global Plc with the new reconstituted board for the full period and I am
pleased to announce that the board is working very well together despite the
head winds. The board is clear on its mandate and strategy and is working
towards achieving this.
Post period end, the Company announced on the 4 July 2023, that it had invested
£200,000 by way of a loan into Precious Link (UK) Limited, a wine retailer,
located within the Southeast of England. The Board believes that Precious Link
operates in a complementary sector and that the loan could assist the Company in
expanding its activities into the wider food and beverage sector.
As mentioned in the Annual Financial Statements for the year ended 31 October
2022, and simultaneous to the investment by Golden Nice International Limited,
Dynamic Intertrade (Pty) Limited ("Dynamic") issued shares to K2 Spice Limited
(previously VSA NEX Investments Limited) ("K2"), for consideration of ZAR10,982,
such that Everest Global retains 51% interest in Dynamic and K2 now holds 49% of
Dynamic. Further, the Company granted K2 a put option for £1 to acquire the
remaining 51% once certain conditions have been met. In addition, certain debts
owing by Dynamic to the Company and certain other parties were also assigned to
K2 in consideration for K2 paying to the Company £100,001 and agreeing to fund
Dynamic so as to enable Dynamic to carry on its business in the ordinary course
until such time as the Company ceases to hold any further shares in Dynamic.
The Company's present primary operations and source of revenue remains its 51%
holding in Dynamic, our Cape Town based spice blender and trader. The underlying
Company was still loss making for the year ended 31 October 2022 (see Note 4 for
a full explanation) but has since improved its performance during the six-months
ended 30 April 2023. Group turnover increased by 20.98% (6 months to 30 April
2022: a reduction of 13.5%). Group operating losses amounted to £1,380,631 (6
months to 30 April 2022: £11,176) for the current period.
During the period our previous auditor resigned as they were no longer in a
position to audit Public Interest Entity ("PIE") companies and due to capacity
constraints with many other auditors there was a delay in appointing a PIE
registered auditor. As a result, the Company could not complete their statutory
audit, publication of results or statutory filing at Companies House on time. As
such, trading in the Company's Ordinary Shares and its listing on the Official
List of the Financial Conduct Authority was suspended. The Company was granted
an extension of its filing obligations by Companies House.
Dynamic Intertrade ("Dynamic")
For the 6-month period ending 30 April 2023, Dynamic recorded revenue of R30.8
million (30 April 2022, R14.04 million, and 31 October 2022, R34.8 million)
representing a 119% increase. This increase in revenue resulted in gross profit
of R9.28 million (representing a gross margin of 30%). This is a 50% improvement
in the margin from the 20% for the six months ended 30 April 2022 and the 24.74%
for the full year ended 31 October 2022. Operating expenses have increased by
11% to R4.9 million from R4.4 million for the period to 30 April 2022. EBITDA
was R4.6 million (31 October 2022: Loss - R11.2 million).
While a pleasing improvement it has put pressure on the working capital
requirements which we are expecting K2 to assist with under an agreement signed
on 3 October 2022.
DI has maintained its FSSC22000 certification which is important when dealing
with blue chip food manufacturing companies.
Dynamic Intertrade Agri ("DIA")
As stated on 20 July 2023, the Company's 46.8% share in DIA was disposed of to
Athena Trading Worldwide Limited for a consideration of £15,384.62.
Group Results for the period
Group turnover increased to £1,434,073 for the six months ended 30 April 2023
from the £681,761 for the comparative period ended 30 April 2022, and is only
15,6% lower than the turnover for the full year ended 31 October 2022 of
£1,698,839. The Group made an operating profit of £476,634 for the six months to
30 April 2023 (30 April 2022: loss of £11,176, 31 October 2022: loss of
£1,152,170). This has primarily been the result of an improvement in the
exchange rates as evidenced by the gain on foreign exchange of £383,990 and the
increase in revenue mentioned above.
At the end of the period under review the Company had cash and cash equivalents
of £1,405,609 (30 April 2022: £503,399, 31 October 2022: £925,814).
Outlook
While the world economy is uncertain with the war in the Ukraine, inflation,
high interest rates and, uncertain demand and supply we believe we will steady
the Company and give it a solid foundation for future growth.
Theunaudited interim report for the 6 months ended 30 April 2023is available on
the Company's website at:www.everestglobalplc.comand in hard copy form at the
Company's registered office at 48 Chancery Lane, London WC2A 1JF.
It will also shortly beavailable for inspection at:
www.fca.org.uk/markets/primary-markets/regulatory-disclosures/national-storage
-mechanism (https://urldefense.proofpoint.com/v2/url?u=http
-3A__www.fca.org.uk_markets_primary-2Dmarkets_regulatory-2Ddisclosures_national
-2Dstorage-2Dmechanism&d=DwMGaQ&c=euGZstcaTDllvimEN8b7jXrwqOf
-v5A_CdpgnVfiiMM&r=7Um2a7LLyUH5SxHgl6zdagatUzGQxXwYgU_CeVAgL9Q&m=kR_Hjjn07Jsd47Ii
TGeyUKC3Q2HOmc2k-HnXXjfJDbg&s=z7lAUYO9aq6HBtuB_Hq8I10m4igZv3uixdkqQJaliao&e=).
Prior to publication, the information contained within this announcement was
deemed by the Company to constitute inside informationfor the purposes of
Article 7 of EU Regulation 596/2014 (which forms part of domestic UK law
pursuant to the European Union (Withdrawal) Act 2018). With the publication of
this announcement, this information is now considered to be in the public
domain.
The Directors of the Company accept responsibility for the content of this
announcement.
For further information please contact the following:
Everest Global plc
Andy Sui, Chief Executive Officer +44 (0) 776 775 1787
Rob Scott, Non-Executive Director +27 (0)846006 001
Cairn Financial Advisers LLP
Jo Turner / Emily Staples +44 (0) 20 7213 0885 / +44 (0)20 7213 0897
Caution regarding forward looking statements
Certain statements in this announcement, are, or may be deemed to be, forward
looking statements. Forward looking statements are identi?ed by their use of
terms and phrases such as "believe", "could", "should" "envisage",
"estimate", "intend", "may", "plan", "potentially", "expect", "will"
or the negative of those, variations or comparable expressions, including
references to assumptions. These forward-looking statements are not based on
historical facts but rather on the Directors' current expectations and
assumptions regarding the Company's future growth, results of operations,
performance, future capital and other expenditures (including the amount, nature
and sources of funding thereof), competitive advantages, business prospects and
opportunities. Such forward looking statements re?ect the Directors' current
beliefs and assumptions and are based on information currently available to the
Directors.
Principal Risks and uncertainties for the remaining 6 months of the financial
year
The Directors consider the following risk factors to be of relevance to the
Group's activities for the remaining 6 months of the financial year. It should
be noted that the list is not exhaustive and that other risk factors not
presently known or currently deemed immaterial may apply:
i.Development Risk
The Group's development will be, in part, dependent on the ability of the
Directors to continue to improve the current business, to identify suitable
investment opportunities and to implement the Group's strategy. There is no
assurance that the Group will be successful in acquiring suitable investments.
ii.Sector Risk
The agriculture and agri-processing sectors are highly competitive markets and
many of the competitors will have greater financial and other resources than the
Company and as a result may be in a better position to compete for
opportunities.
The development of these enterprises involves significant uncertainties and
risks including unusual climatic conditions such as drought, improper use of
pesticides, availability of labour and seasonality of produce, any one of which
could result in security of supply, damage to, or destruction of crops,
environmental damage or pollution. Each of these could have a material adverse
impact on the business, operations and financial performance of the Group.
The market price of agricultural products and crops is volatile and affected by
numerous factors which are beyond the Group's control. These include
international supply and demand, the level of consumer product demand,
international economic trends, currency exchange rate fluctuations, the level of
interest rates, the rate of inflation, global or regional political events, as
well as a range of other market forces. Sustained downward movements in
agricultural prices could render less economic, or un-economic, any development
or investing activities to be undertaken by the Group. Certain agricultural
projects involve high capital costs and associated risks. Unless such projects
enjoy long term returns, their profitability will be uncertain resulting in
potentially high investment risk.
iii.Political and Regulatory Risk
African countries experience varying degrees of political instability. There can
be no assurance that political stability will persist in those countries where
the Group may have operations going forward. In the event of political
instability or changes in government policies in those countries where the Group
may operate, the operations and financial condition of the Group could be
adversely affected.
iv.Environmental Risks and Hazards
All phases of the Group's operations are subject to environmental regulation in
the areas in which it operates. Environmental legislation is evolving in a
manner that may require stricter standards and enforcement, increased fines and
penalties for non-compliance, more stringent environmental assessments of
proposed projects and a heightened degree of responsibility for companies and
their officers, Directors and employees.
There is no assurance that existing or future environmental regulation will not
materially adversely affect the Group's business, financial condition and
results of operations. Environmental hazards may exist on the properties on
which the Group holds interests that are unknown to the Group at present. The
Board manages this risk by working with environmental consultants and by
engaging with the relevant governmental departments and other concerned
stakeholders.
v.Internal Control and Financial Risk Management
The Board has overall responsibility for the Group's systems of internal control
and for reviewing their effectiveness. The Group maintains systems which are
designed to provide reasonable but not absolute assurance against material loss
and to manage rather than eliminate risk.
The key features of the Group's systems of internal control are as follows:
· Management structure with clearly identified responsibilities;
· Production of timely and comprehensive historical management information
presented to the Board;
· Detailed budgeting and forecasting;
· Day to day hands on involvement of the Executive Director and Senior
Management; and
· Regular Board meetings and discussions with the Non-Executive Directors.
The Group's activities expose it to several financial risks including cash flow
risk, liquidity risk and foreign currency risk.
vi.Environmental Policy
The Group is aware of the potential impact that its subsidiary and associate
companies may have on the environment. The Group ensures that it complies with
all local regulatory requirements and seeks to implement a best practice
approach to managing environmental aspects.
The subsidiary, Dynamic Intertrade operates a Food SafetySystem Certification
("FSSC") compliant facility in Cape Town. The FSSC provides a framework for
effectively managing the organisation's food safety responsibilities and is
fully recognized by the Global Food Safety Initiative and is based on existing
ISO Standards.
vii. Health and Safety
The Group's aim is to achieve and maintain a high standard of workplace safety.
In order to achieve this objective, the Group provides ongoing training and
support to employees and sets demanding standards for workplace safety.
viii.Financing Risk
The development of the Group's business may depend upon the Group's ability to
obtain financing primarily through the raising of new equity capital or debt.
The Group's ability to raise further funds may be affected by the success of
existing and acquired investments. The Group may not be successful in procuring
the requisite funds on terms which are acceptable to it (or at all) and, if such
funding is unavailable, the Group may be required to reduce the scope of its
investments or the anticipated expansion. Further, Shareholders' holdings of
Ordinary Shares may be materially diluted if debt financing is not available.
ix.Credit Risk
The Directors have reviewed the forecasts prepared by both the Company and
Dynamic and believe that Dynamic has adequate resources available to meet its
obligations to the Company and its lenders.
x.Liquidity Risk
The Directors have reviewed the working capital requirements of the Company and
Dynamic and believe that, following stress tests and variance analysis on the
forecasts, there is sufficient working capital to fund the business while
expanding turnover. The Directors further highlight the inherent uncertainties
involved in making the assessment that the entity is a going concern.
xi. Capital Risk
The Group manages its capital resources to ensure that entities in the Group
will be able to continue as a going concern, while maximising shareholder
return.
The capital structure of the Group consists of equity attributable to
shareholders, comprising issued share capital and reserves. The availability of
new capital will depend on many factors including a positive operating
environment, positive stock market conditions, the Group's track record, and the
experience of management. There are no externally imposed capital requirements.
The Directors are confident that adequate cash resources exist or will be made
available to finance operations and controls over expenditure are carefully
managed.
To manage the above risks, management are in regular contact with our customers
and are actively exploring new markets and customers in order to diversify these
risks.
Responsibility Statement
The Directors, whose names and functions are set out under the `Directors and
Advisers' section of this report with registered office located at 48 Chancery
Lane, London WC2A 1JF, accept responsibility for the information contained in
this set of interim results for the six month period ended 30 April 2023.
To the best of the knowledge of the Directors:
· The condensed set of financial statements are prepared in accordance
with the applicable set of accounting standards (with IAS 34 `Interim Financial
Reporting' as contained in UK-adopted IFRS), give a true and fair view of the
assets, liabilities, financial position and profit or loss of Everest Group Plc
and the undertakings included in the consolidation taken as a whole; and
· the interim management report, titled `Chief Executive's Report'
includes an indication of important events that have occurred during the first
six months of the financial year, and their impact on the condensed set of
financial statements, and a description of the principal risks and
uncertainties for the remaining six months of the financial year.
· the interim management report includes a fair review of the
information required by DTR 4.2.8R (disclosure of related parties' transactions
and changes therein).
Everest Group Plc acknowledges that it is responsible for all information drawn
up and made public in this set of interim results for the period ended 30 April
2023.
Andy Sui
Chief Executive Officer
31 July 2023
Interim Condensed Consolidated Statement of Comprehensive Income
6 Months Year ended 6 Months
ended ended
30 April 31 October 30 April
2023 2022 2022
(Unaudited) (Audited) (Unaudited)
Notes £ £ £
Turnover 1,434,073 1,698,839 681,761
Cost of sales (1,002,206) (1,278,471) (545,163)
Gross profit 431,867 420,368 136,598
Other Income 383,990 1,264 315,495
Administrative 4 (339,223) (1,573,802) (463,269)
expenses
Operating profit / 476,634 (1,152,170) (11,176)
(loss)
Finance costs (117,548) (3,418,549) (125,403)
Finance income 20,377 157 -
Profit / (loss) 379,463 (4,570,562) (136,579)
before taxation
Tax on Profit / - - -
(loss) on ordinary
activities
Profit / (loss) 379,463 (4,570,562) (136,579)
after taxation
Other - - -
Comprehensive
Income
Total 379,463 (4,570,562) (136,579)
comprehensive
income / (loss)
for the year from
continuing
operations
Total 137,570 (4,571,084)
comprehensive
income / (loss)
attributable to
ordinary
shareholders
Total 241,893 522
comprehensive
income / (loss)
attributable to
non-controlling
interests
Total 379,463 (4,570,562) (136,579)
comprehensive
income / (loss)
for the period
Basic and diluted 5 1.15p (17.79p) (0.62p)
earnings per share
Interim Condensed Consolidated Statement of Changes in Equity
Share Share Share Equity Retained Total
Oustide Total
Capital Premium Based Portion of Earnings Equity
Shareholder's Equity
Payments Convertible
Interest
Reserve Loan
Notes
£ £ £ £ £ £
£ £
Balance at 439,322 2,571,247 83,377 74,935 (4,416,527)
(1,247,646) - (1,247,646)
31
October 2021
Share Issue 76,473 76,473 - - - 152,946
- 152,946
Loss for the - - - - (136,579)
(136,579) - (136,579)
period
Balance at 515,795 2,647,720 83,377 74,935 (4,553,106)
(1,231,279) - (1,231,279)
30 April
2022
Shares 260,000 390,000 650,000
- 650,000
issued
Shares 147,463 221,194 368,657
- 368,657
issued on
conversion
of
convertible
loan
notes
Extension of - - - (32,396) (32,396)
- (32,396)
date
of
conversion
of
the
convertible
loan
notes
Warrants - (218,799) 218,799 - -
- -
issued
during the
year
Loss - - - - 2,305,905
2,305,905 (2,305,905) -
attributable
to non
-controlling
interest on
disposal of
49% of
subsidiary
Loss for the - - - - (4,434,505)
(4,434,505) 522 (4,433,983)
year
Balance at 923,258 3,040,115 302,176 42,539 (6,681,706)
(2,373,618) (2,305,383) (4,679,001)
31
October 2022
Share Issue 254,520 445,410 - - - 699,930
- 699,930
Conversion 120,000 180,000 - - - 300,000
- 300,000
of
convertible
loan
notes to
equity
Warrants - (48,573) 48,573 - - -
- -
issued
during the
period
Loss for the - - - - 137,570 137,570
241,893 379,463
period
Balance at 1,297,778 3,616,952 350,749 42,539 (6,544,136)
(1,236,118) (2,063,490) (3,299,608)
30 April
2023
Share capital is the amount subscribed for shares at nominal value.
Retained losses represent the cumulative loss of the Group attributable to
equity shareholders.
Share-based payments reserve relate to the charge for share-based payments in
accordance with IFRS 2.
Interim Condensed Consolidated Statement of the Financial Position
6 Months ended Year ended 6 Months ended
30 April 31 October 30 April
2023 2022 2022
(Unaudited) (Audited) (Unaudited)
Notes £ £ £
Assets
Non-current assets
Property, plant and 6 25,632 13,884 11,266
equipment
Right of use asset 11 204,809 250,446 327,829
Total Non-Current 230,441 264,330 339,095
Assets
Current assets
Investment in 8 6,154 6,154 6,154
associate - (held
for sale)
Inventories 211,983 175,875 34,847
Trade and other 489,713 282,529 327,299
receivables
Cash and cash 1,405,609 925,814 503,399
equivalents
Total current assets 2,113,459 1,390,372 871,699
Total assets 2,343,900 1,654,702 1,210,794
Equity and
liabilities
Share capital 9 1,297,778 923,258 515,795
Share premium 9 3,616,952 3,040,115 2,647,720
Share-based payments 350,749 302,176 83,377
reserve
Equity portion of 42,539 42,539 74,935
convertible loan
notes
Retained earnings (6,544,136) (6,681,706) (4,553,107)
Total owner's equity (1,236,118) (2,373,618) (1,231,280)
Non-controlling (2,063,490) (2,305,383) -
interests
Total equity (3,299,608) (4,679,001) (1,231,280)
Non-current
liabilities
Non-current lease 10 120,167 166,070 242,796
liabilities
Borrowings 4,322,281 4,732,492 791,472
Convertible loan 450,802 710,274 778,065
notes
Total non-current 4,893,250 5,608,836 1,812,333
liabilities
Current liabilities
Current lease 10 101,110 100,485 87,866
liabilities
Trade and other 649,148 624,382 542,326
payables
Total current 750,258 724,867 630,192
liabilities
Total equity and 2,343,900 1,654,702 1,210,794
liabilities
Interim Condensed Consolidated Statement of Cash Flows
6 Months Year ended 6 Months
ended ended
30 April 31 October 30 April
2023 2022 2022
(Unaudited) (Audited) (Unaudited)
Notes £ £ £
Cash flows from operating
activities
Operating loss 476,634 (1,152,170) (11,176)
Add: Depreciation 45,369 84,960 37,547
Add: unrealised foreign (41,293) (26,728)
exchange (gain) / loss
Add: (Profit)/loss on disposal - - 1,256
of property, plant and
equipment
Finance costs 61,809 (124,889) (185,777)
Interest received 20,377 157 -
Profit on disposal of loans - 1
receivable
Changes in working capital
(increase) / decrease in (36,108) (133,193) (5,720)
inventories
(increase) / decrease in (207,184) 15,271 44,257
receivables
(Decrease) / increase in 24,766 (538,038) (715,968)
payables
Net cash flow from operating 385,663 (1,889,194) (862,309)
activities
Investing Activities
Acquisition of property, plant (28,287) (5,541) (257)
and equipment
Disposal of property, plant and - - 1,303
equipment
Foreign exchange movements 2,103 (7) (19,593)
Net cash flow from investing (26,184) (5,548) (18,547)
activities
Cash flows from financing
activities:
Net proceeds from issue of 9 699,930 650,000 -
shares
(Decrease) / Increase in (527,815) 1,134,015 348,503
borrowings
Foreign exchange movements - (23,095)
Capital repayments of lease (51,799) (73,233) (50,863)
liability
Net cash flow from financing 120,316 1,710,782 274,545
activities
Net cash flow for the period 479,795 (183,960) (606,311)
Opening Cash and cash 925,814 1,109,774 1,109,774
equivalents
Foreign exchange movements - (64)
Closing Cash and cash 1,405,609 925,814 503,399
equivalents
Notes to the Interim Condensed Consolidated Financial Statements
1.General Information
Everest Global plc is a company incorporated in the United Kingdom. Details of
the registered office, the officers and advisers to the Company are presented on
the Directors and Advisers page at the end of this report. The Company is
admitted to the Official List (by way of a Standard Listing under Chapter 14 of
the Listing Rules) and to trading on the London Stock Exchange's Main Market for
listed securities. The information within these Interim condensed consolidated
financial statements and accompanying notes must be read in conjunction with the
audited annual financial statements that have been prepared for the year ended
31 October 2022.
2.Basis of Preparation
These unaudited condensed consolidated interim financial statements for the six
months ended 30 April 2023 have been prepared in accordance with International
Accounting Standard No34, Interim Financial Reporting, as contained in
International Financial Reporting Standards as adopted by the United Kingdom
(IFRS as adopted by the UK), were approved by the board and authorised for
issue on 31 July 2023.
The basis of preparation and accounting policies set out in the Annual Report
and Accounts for the year ended 31 October 2022 have been applied in the
preparation of these condensed consolidated interim financial statements. These
interim financial statements have been prepared in accordance with the
recognition and measurement principles of the International Financial Reporting
Standards ("IFRS") as endorsed by the UK that are expected to be applicable to
the consolidated financial statements for the year ending 31 October 2023 and on
the basis of the accounting policies expected to be used in those financial
statements.
The figures for the six months ended 30 April 2023 and 30 April 2022 are
unaudited and do not constitute full accounts. The comparative figures for the
year ended 31 October 2022 are extracts from the 2022 audited accounts. The
independent auditor's report on the 2022 accounts was qualified on the basis
that they were appointed after the year and could not verify the value of the
inventory on hand by the subsidiary at the year end, and it included a material
uncertainty in respect of going concern.
3.Segmental Reporting
In the opinion of the Directors, the Group has one class of business, being the
trading of agricultural materials. The Group's primary reporting format is
determined by the geographical segment according to the location of its
establishments. There is currently only one geographic reporting segment, which
is South Africa. All revenues and costs are derived from the single segment.
Historically this segment has experienced a high demand for its products in the
months of July to December with a lower-than-average demand in the months of
January to March.
4.Company Result for the period
The Company has elected to take the exemption under section 408 of the Companies
Act 2006 not to present the parent Company income statement account.
The operating profit of the Group for the six-month period ended 30 April 2023
was £476,634 (30 April 2022: loss of £11,176, year end 31 October 2022: loss of
£1,152,170). The operating loss incorporated the following main items:
6 Months ended Year 6 Months ended
ended
30 April 31 30 April
October
2023 2022 2022
(Unaudited) (Audited) (Unaudited)
£ £ £
Accounting and 16,626 39,338 24,413
administration fees
Brokership fees 2,473 15,000 -
Legal and 57,514 (269,522) 32,164
professional fees
Registrar fees 2,493 3,034 1,767
Personnel expenses 133,121 232,273 105,709
Finance charges
associated with - 3,131,890 -
disposal of
intercompany loan to
VSA NEX Investments
Limited
As set in the annual financial statements for the year ended 31 October 2022, on
3 October 2022, the Company and K2 Spice Limited (previously VSA NEX Investments
Limited) ("K2"), entered into certain related party arrangements in relation to
Dynamic Intertrade (Pty) Ltd ("Dynamic"). K2 was a 100% subsidiary of VSA
Capital. At the time the arrangements were entered into Andrew Monk was a
director of the Company, VSA Capital and K2 and is deemed to have significant
influence over VSA Capital and K2. Pursuant to the arrangements, K2 subscribed
for such number of new shares in the capital of Dynamic resulting in K2 holding
49% of the enlarged issued share capital of Dynamic for a consideration of
ZAR10,982; the Company agreed to assign certain debts owing by Dynamic,
amounting to £4.2 million which had been fully impaired in prior years, to the
Company and certain other parties to K2 in consideration for K2 paying to the
Company £100,001 and agreeing to fund Dynamic so as to enable Dynamic to carry
on its business in the ordinary course until such time as the Company ceases to
hold any further shares in Dynamic. This assignment agreement resulted in K2
having a non-controlling interest in Dynamic and as such its share of the
current year profits amounted to £522, its share of accumulated losses prior to
acquisition amounted to £3,131,890. Additionally, the assignment of the loans
resulted in the Group incurring a finance charge on consolidation of £2.9
million. K2 has signed a subordination agreement in relation to the loans due by
Dynamic to K2 with an expiry date of 31 October 2023. Should K2 choose to
request the repayment of the loans due by Dynamic this will severely impact the
Company's ability to continue as a going concern. Under a put and call option
agreement the Company granted to K2 the option to acquire 11,430 shares in
Dynamic Intertrade, being the remaining 51% of Dynamic held by the Company,
subject to the satisfaction of certain conditions and subject to certain time
restrictions for £1.
5.Earnings per Share
Earnings per share data is based on the Group result for the six months and the
weighted average number of ordinary shares in issue.
Basic loss per share is calculated by dividing the loss attributable to equity
shareholders by the weighted average number of Ordinary Shares in issue during
the period:
6 Months ended Year ended 6 Months ended
30 April 31 October 30 April
2023 2022 2022
(Unaudited) (Audited) (Unaudited)
£ £ £
Profit / (loss) after tax 379,463 (4,570,562) (136,579)
Weighted average number 33,023,894 25,690,228 21,966,077
of ordinary shares in
issue
Basic earnings / (loss) 1.15p (17.79p) (0.62p)
per share (pence)
Diluted earnings / (loss) 0.36p (17.79p) (0.62p)
per share (pence)
For the comparative figures as at 31 October 2022 and 30 April 2022, the basic
and diluted earnings per share are the same, since where a loss is incurred the
effect of outstanding share options and warrants is considered anti-dilutive and
is ignored for the purpose of the loss per share calculation. As at 30 April
2023 there were 42,922,767 Ordinary Shares and 38,363,171 share warrants
outstanding (31 October 2022: 24,196,767 Ordinary shares and 38,363,171 share
warrants outstanding, 30 April 2022 there were 26,148,289 Ordinary shares and
897,809 share warrants outstanding).
6.Property, Plant and Equipment
Depreciation on property, plant and equipment is calculated using the straight
-line method to write off their cost over their estimated useful lives at the
following annual rates:
Furniture and fixtures 17%
Leasehold improvements 33%
Plant and equipment 20% and 33%
Useful lives and depreciation method are reviewed and adjusted if appropriate,
at the end of each reporting period.
An item of property, plant and equipment is derecognised upon disposal or when
no future economic benefits are expected to arise from the continued use of the
asset. Any gain or loss arising on the disposal or retirement of an item of
property, plant and equipment is determined as the difference between the sales
proceeds and the carrying amount of the relevant asset and is recognised in
profit or loss in the year in which the asset is derecognised.
Group Leasehold Furniture and fixtures Plant and equipment Total
property
£ £ £ £
Cost
As at 31 19,746 4,356 279,382 303,484
October 2021
Exchange 979 216 13,844 15,039
difference
Additions - - 257 257
Disposals - - (5,088) (5,088)
As at 30 20,725 4,572 288,395 313,692
April 2022
Exchange (1,173) (272) (43,830) (45,275)
difference
Additions - - 10,372 10,372
Disposals - - - -
As at 31 19,552 4,300 254,937 278,789
October 2022
Exchange - (350) (32,380) (32,730)
difference
Additions - - 28,287 28,287
Disposals - - - -
As at 30 19,552 3,950 250,844 274,346
April 2023
Accumulated
depreciation
As at 31 19,720 4,060 265,935 289,715
October 2021
Exchange 977 205 13,298 14,480
difference
Charge for 25 98 3,196 3,319
the year
Released on - - (5,088) (5,088)
disposal
As at 30 20,722 4,363 277,341 302,426
April 2022
Exchange (1,172) (245) (38,205) (39,622)
difference
Charge for - 75 2,026 2,101
the year
Released on - - - -
disposal
As at 31 19,550 4,193 241,162 264,905
October 2022
Exchange - (353) (30,274) (30,627)
difference
Charge for - 50 14,386 14,436
the year
Released on - - - -
disposal
As at 30 19,550 3,890 225,274 248,714
April 2023
Net Book
Value
As at 30 3 209 11,054 11,266
April 2022
As at 31 2 107 13,775 13,884
October 2022
As at 30 2 60 25,570 25,632
April 2023
The holding company held no tangible fixed assets at 30 April 2023, 31 October
2022 and 30 April 2022.
7.Subsidiaries
Everest Global plc holds investments in the following subsidiary undertakings as
at 30 April 2023, which principally affected the profits, losses and net assets
of the Group.
Name of Principal Country of Proportion Proportion
companies activities incorporation (%) of (%) of
and place equity equity
of business interest at interest at
30 April 30 April
2023 2022
Dynamic Value added South Africa 51% 100%
Intertrade agricultural
(Pty) products
Limited
Subsidiaries are all entities over which the Group has the power to govern the
financial and operating policies generally accompanying a shareholding of more
than one half of the voting rights. Subsidiaries are consolidated, using the
acquisition method, from the date that control is gained and are stated at cost
less, where appropriate, provisions for impairment. Entities that do not comply
with this policy, but over which the Group has a shareholding of between 20 and
50 percent of the voting rights are equity accounted from the date of
acquisition and are stated at cost and adjusted for the results of these
entities for the accounting period.
The remaining 49%, a non-controlling interest, is held by K2 Spice Limited,
formerly VSA NEX Investments Limited. The circumstances surrounding this
dilution of the Company's holding in Dynamic is explained in the annual
financial statements for the year ended 31 October 2022.
8.Investment in Associate
6 Months ended Year ended 6 Months ended
30 April 31 October 30 April
2023 2022 2022
(Unaudited) (Audited) (Unaudited)
£ £ £
Investment in Dynamic
Intertrade Agri (Pty) 6,154 6,154 6,154
Ltd
Equity accounted - - -
profit/ (loss) for the
period
Impairment of - - -
investment
Carrying value
6,154 6,154 6,154
9.Share Capital
Ordinary Shares are classified as equity. Proceeds from issuance of Ordinary
Shares are classified as equity. Incremental costs directly attributable to the
issuance of new Ordinary Shares are deducted against share capital.
Allotted, Number of
called
up and
fully
paid
Ordinary
Shares of shares Share Capital Share Premium
2.0p
each
£ £
Balance at 21,966,088 439,322
31 2,571,247
October
2021
Share issue 3,823,627 76,473
- 29 76,473
April 2022
Balance at 25,789,715 515,795
30 2,647,720
April 2022
Share issue 7,373,140 147,463
on 221,194
conversion
of
convertible
loan
notes 3
October
2022
Share issue 13,000,000 260,000
3 390,000
October
2022
Warrants (218,799)
issued - -
- 3 October
2022
Balance at 46,162,855 923,258
31 3,040,115
October
2022
Share issue 12,726,000 254,520
- 24 445,410
January
2023
Warrants
issued - -
- 24
January
2023
Conversion
of
Convertible
Loan
Notes -
25 6,000,000 120,000
January 180,000
2023
Warrants
issued - -
- 24
January
2023
Balance at 64,888,855 1,297,778
30 3,665,525
April 2023
10Leases
Right of Use Asset and Liability
On adoption of IFRS 16, the Group recognised lease liabilities in relation to
leases which had previously been classified as 'operating leases' under the
principles of IAS 17 Leases. These liabilities were measured at the present
value of the remaining lease payments, discounted using the lessee's incremental
borrowing rate for comparable assets as of 1 November 2019. The weighted average
lessee's incremental borrowing rate for comparable mortgage bonds applied to the
lease liabilities on 1 November 2019 was 8.5%, being the discount rate on the
Group's borrowings. In the Directors opinion this is the discount rate that the
Group would obtain should it be purchasing land and buildings. Without further
security available the Group would be unlikely to secure funding from other
sources and therefore the Directors believe the 8.5% rate applied is the most
appropriate basis on which to base the IFRS 16 calculations.
For leases previously classified as finance leases the entity recognised the
carrying amount of the lease asset and lease liability immediately before
transition as the carrying amount of the right of use asset and the lease
liability at the date of initial application. The measurement principles of IFRS
16 are only applied after that date.
6 Months ended Year ended 6 Months ended
30 April 31 October 30 April
2023 2022 2022
(Unaudited) (Audited) (Unaudited)
£ £ £
Lease liability
recognised in the
statement
of financial position 266,555 347,102 347,102
at 31 October 2021
Foreign exchange (3,455) (7,313) 17,200
movements
borrowing rate at date 9,975 - 17,223
of initial application
Lease payments (51,799) (73,234) (50,863)
Lease liability
recognised in the
statement of financial 221,276 266,555 330,662
position
Of which:
Current lease 101,110 100,485 87,866
liabilities
Non-current lease 120,167 166,070 242,796
liabilities
221,277 266,555 330,662
Right-of use assets were measured at the amount equal to the lease liability,
adjusted by the amount of any prepaid or accrued lease payments relating to that
lease recognised in the statement of financial position as at 31 October 2022.
There were no onerous lease contracts that would have required an adjustment to
the right-of-use assets at the date of initial application. The recognised right
of-use assets relate to the following types of assets:
6 Months ended Year ended 6 Months ended
30 April 31 October 30 April
2023 2022 2022
(Unaudited) (Audited) (Unaudited)
£ £ £
Properties 204,809 250,446 327,829
11Events Subsequent to 30 April 2023
On 4 July 2023, the Company entered into an agreement to provide a loan to
Precious Link (UK) Limited ("Precious Link"), a wine retailer, incorporated and
registered in England and Wales, located within the Southeast of England. The
loan is for a sum of £200,000, is unsecured and attracts interest at 10 per
cent. per annum payable monthly in arrears. The loan is repayable on demand by
the Company and is repayable on 5 business days' notice from Precious Link.
On 20 July 2023, the Company sold its 46.8% equity stake in Dynamic Intertrade
Agriculture (Pty) Ltd ("DIA") to Athena Trading Worldwide Limited, a private
company, for a consideration of £15,384.62, payable in cash on completion The
contractual completion date is 31 July 2023. The investment in DIA had been held
in the balance sheet of the Group as an asset held for sale since the decision
to sell it had been made.
This information was brought to you by Cision http://news.cision.com
https://news.cision.com/everest-global-plc/r/half-year-report,c3811423
END
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