TIDMACPE
RNS Number : 2569C
ACP Energy PLC
10 October 2022
10 October 2022
ACP ENERGY PLC
("ACP" or "the Company")
Annual Report and Financial Statements
Notice of Annual General Meeting
ACP Energy Plc (ACPE.L), the recently formed company set to
capture value accretive opportunities in the oil & gas
industry, is announcing its Annual Report and Financial Statements
for the period ended 30 June 2022.
Chairman's Statement
I am pleased to report the audited financial statements to
shareholders for the period ended 30 June 2022.
During the period, ACP Energy listed on the Standard Main Market
of the London Stock Exchange on January 28, 2022, having raised a
total of GBP830,000 (before expenses) following ACP Energy's
successful initial public offering ("IPO").
Since this time, the Company has been active in reviewing
numerous opportunities in the upstream oil and gas sector focusing
on production and development assets, as outlined in the Company's
IPO Prospectus.
The Directors, who founded the business, have a significant
interest in the share capital of the Company and look forward to
delivering on the commitment made by shareholders.
Outlook
The period since the Company's IPO has been characterised by
significant geopolitical, economic and market volatility. However,
we are encouraged by the resilience in energy prices and remain
positive on the medium-term outlook. We believe that the current
environment will provide a number of interesting opportunities and
are actively engaged in identifying and completing an acquisition
with significant potential to create value for shareholders.
I would like to thank all shareholders for the support they have
shown for the Company's IPO and we look forward to sharing our
progress in the near future.
Paul Welch
Executive Chairman
7 October 2022
Notice of Annual General Meeting
The Company's Annual General Meeting ("AGM") will be held on 10
November 2022 at 1.00 pm at 13 Hanover Square, London, W1S 1HN.
Further details are set out in the notice of AGM, which will be
available on the Company's website, www.acpenergyplc.com , shortly
and will be sent to Shareholders later today.
For further information:
www.acpenergyplc.com
ACP Energy
Paul Welch, Chairman
Celicourt Communications +44 208 434 2643 / acpenergy@celicourt.uk
Mark Antelme / Jimmy Lea
The Directors present the Strategic Report of the Company for
the period ended 31 March 2022.
Review of business and future developments
Introduction
The Company was incorporated on 8 April 2021 in accordance with
the laws of England and Wales as a private limited company with the
name ACP Energy Limited. The Company was re-registered as a public
limited company on 23 August 2021 with the name ACP Energy Plc.
Company Objectives
The Company was formed to acquire one or more target companies
or businesses. The resulting investment may be in a company,
partnership, special purpose vehicle or joint venture.
The Company will focus on opportunities within the upstream oil
and gas industry, such as appraisal, development or production of
oil and gas, particularly projects with identified oil and/or
natural gas reserves and/or resources. The Company will target
opportunities that have a funding requirement to development and/or
increase production rates. The Company will also focus on those
opportunities that would provide the Company with an economic
interest (by equity, royalty or debt participation) and a control
interest (through board, technical committee and or management
positions) and whose potential value, over the long term, is
greater than the price and costs expended by the Company to acquire
them.
The Company's efforts in identifying opportunities will not be
limited to a particular geographic location.
The Company does not have any specific Acquisition target under
consideration. Unless required by applicable law or other
regulatory process, no Shareholder approval will be sought by the
Company in relation to any such acquisition (of a target company or
business).
Acquisition Strategy
The Board has identified the following criteria for the purpose
of reviewing and evaluating opportunities.
-- Sectoral Focus: the Company intends to focus on opportunities
in the upstream oil and natural gas sector. The Company will have a
particular focus on producing assets, that require additional
investment to increase the production and reserves base. The
Directors believe that, based upon their collective experience,
there are significant opportunities in the upstream oil and gas
sector, and in particular existing producing assets that will
generate value for Shareholders. The Directors, together with their
advisers, have extensive global networks within the sector, and
associated financial services, from which to solicit and assess
opportunities.
-- Development Profile: the Company intends to focus on
producing assets that have not received sufficient investment
capital due to either local fiscal issues or a downturn in
commodity prices. Such assets will likely have had a certain amount
of development work undertaken to establish a minimum base of
production or resource but that, for whatever reason, now requires
further funding in order to either fully develop the opportunity or
to repair or workover the asset to either return it to or increase
its production. The Company therefore expects to focus on
opportunities where the asset will be revenue generating either
immediately upon acquisition or within a reasonable timeframe
following the work program completion. The Directors believe that
this strategy will balance investment risk against long-term
shareholder value.
-- Geography: the Company does not propose to limit its search
to any specific geographic location; however, the Directors will
ensure that the geographic location of any investment opportunity
is suitable for institutional investment in the London market. The
assets may be located anywhere in the world but the Company will
primarily be looking at opportunities in proven hydrocarbon
producing jurisdictions with established oil and gas
infrastructure, and the regulation of such activities.
-- Size of Acquisition Target: the Company is not able to
provide an exact indication of the size of the acquisition target
and it will consider a range of prospective opportunities. The
Directors will primarily focus on opportunities that meet the
acquisition criteria and which are likely to generate value for
shareholders. The Directors propose to use their collective
experience of identifying, originating, structuring and financing
oil and gas transactions to generate value for the Company.
The Directors propose to use their own research to identify
potential opportunities and their expertise to assess the
propositions and will then initiate discussions directly or via
market contacts and professional advisers.
The Directors have a broad range of contacts through which to
identify potential opportunities. Once identified, the Directors
propose to conduct initial due diligence and, where they believe
further investigation is required, propose to appoint appropriately
qualified personnel and professional advisers to assist. The
Directors believe they can undertake this process promptly,
enabling them to determine quickly those opportunities that could
be value accretive to shareholders and to progress to formal due
diligence.
There is no specific expected target value for any proposed
acquisition. The Company expects that any funds not used for the
Acquisition will be used for, internal or external growth and
expansion, and working capital in relation to the acquired company
or business. Furthermore, it is anticipated that the Acquisition is
likely to be near to generating revenue and or profit, which will
provide cash flow for future acquisitions.
Following completion of the Acquisition, the objective of the
Company is to be involved in the operation of the acquired
business. The Company envisions opportunities will be available to
it by taking an active role in the management through operational
improvements, capacity expansions or funding working capital.
Operational management may provide superior insight into a
particular sector or operating region allowing value accretive
complementary acquisitions to be made.
The Directors' long-term aim is to create shareholder value by
investing in projects with dependable cashflows and build a
portfolio where the Directors believe that there are large
potential upsides in value by providing vital finance and expertise
enabling a company or business in the natural resources sector to
increase its
production and reserve base.
Principal risks and uncertainties
RISKS RELATING TO THE COMPANY'S BUSINESS STRATEGY
There is no assurance that the Company will conclude an
Acquisition in a timely manner or at all.
The success of the Company's business strategy is dependent on
its ability to identify sufficient suitable Acquisition
opportunities. The Directors are unable to guarantee that the
Company will be able to complete an Acquisition or that it will be
able to complete an Acquisition within a reasonable timeframe.
An Acquisition target identified by the Company may not proceed
for a number of valid reasons, including, inter alia, the Company
is outbid by a competitor, terms cannot be agreed with the vendors
or due diligence reveals significant issues with the target.
Aborting a proposed Acquisition or Acquisitions could mean that the
Company is left with substantial unrecovered transaction costs,
potentially including fees, legal costs, accounting costs, due
diligence or other expenses that may not allow it to pursue further
opportunities.
Even if the Company completes an Acquisition, there is no
assurance that any operating improvements will be successful or,
that they will be effective in increasing the valuation of any
business acquired
Following an Acquisition, the Company will endeavour to generate
Shareholder value through applying financial and sectoral expertise
to effect operational improvements. However, there can be no
assurance that the Company will be able to propose and implement
effective operational improvements for any company or business
which the Company acquires. In addition, even if the Company
completes an Acquisition, general economic and market conditions or
other factors outside the Company's control could make the
Company's operating strategies difficult or impossible to
implement. Any failure to implement these operational improvements
successfully and/or the failure of these operational improvements
to deliver the anticipated benefits could have a material adverse
effect on the Company's results and financial condition.
The Company may be unable to complete an Acquisition or to fund
the operations of the target business if it does not obtain
additional funding
The Company has not yet identified an Acquisition target but the
Directors are of the view that its Acquisition strategy will enable
it to identify a range of opportunities meeting its criteria and
which are capable of returning value to Investors. On that basis,
the Company cannot currently predict the amount of additional
capital that may be required for an Acquisition if the target is
sufficiently large or if the target is not sufficiently cash
generative, further funds may need to be raised.
Although the Company intends to finance acquisitions primarily
through the issue of Ordinary Shares in the Company, if, following
an acquisition, the Company's cash reserves are insufficient; the
Company may be required to seek additional equity financing. The
Company may not receive sufficient support from its existing
Shareholders to raise additional equity, and new equity investors
may be unwilling to invest on terms that are favourable to the
Company, or at all. The Company may also need to consider pursuing
debt financing as a means to obtain additional financing but the
lenders may be unwilling to provide debt financing to the Company
on attractive terms, or at all. To the extent that additional
equity or debt financing is necessary to complete an Acquisition
and remains unavailable or only available on terms that are
unacceptable to the Company, the Company may be compelled either to
restructure or abandon an Acquisition, or proceed with an
Acquisition on less favourable terms, which may reduce the
Company's return on the investment.
Even if additional financing is unnecessary to complete an
Acquisition, the Company may subsequently require equity or debt
financing to implement operational improvements in an acquired
business. The failure to secure additional financing or to secure
such additional financing on terms acceptable to the Company could
have a material adverse effect on the continued development or
growth of the acquired business.
.
RISKS ASSOCIATED WITH NATURAL RESOURCES SECTOR
Industry-specific risks
The Directors' strategic goal is to complete an acquisition in
the oil and gas sector. Investors should nevertheless be aware that
the oil and gas sector is inherently tied to the performance of the
global economy and, in particular, fluctuations in the price of oil
and gas.
The Directors cannot provide a clear indication of the timespan
it will take to conclude an Acquisition and any Acquisition will be
subject to an appropriate level of due diligence and investigation
undertaken by the Board together with its advisors. Investors
should therefore be aware that a shift in global economy and, in
particular, fluctuations in the price of oil and gas, during such
time could mean that there are potentially fewer attractive
Acquisition opportunities available and this could mean that
competition for such intensifies. If such risks were to materialise
this could mean that the ability of the Board to complete an
Acquisition could be adversely affected.
Production and development risks
Oil and gas production and development in which the Board
intends to focus is by its nature speculative in nature and
involves a high degree of risk. Shareholders should be aware that
the company, business or asset that the Company acquires as a
result of an Acquisition may not ultimately reach the stage of
production and may not be able to generate revenue in timescales
that investors may consider reasonable or at all, as a result of
factors beyond the control of the Company and its Board. This could
result in shareholders losing their investment and or failing to
generate any return on their investment in the Company.
The specific factors relating to a potential Acquisition target
are not capable of being ascertained as at the date of this
Document. Nevertheless, the economics of developing oil and gas
properties are affected by many general factors including the cost
of operations, availability of drilling equipment, reserve and
resources estimates, volatility of prices for oil and gas,
fluctuations in exchange rates, costs of development,
infrastructure and processing equipment and such other factors as
government regulations, including regulations relating to
royalties, allowable production, importing and exporting and
environmental protection.
The exploration and development of a project following an
Acquisition could be subject to delay and potential funding issues.
Production and development of gas assets generally require
significant capital investment. It could therefore mean that
several further fundraising rounds from the issue of new Ordinary
Shares are required following and in conjunction with an
Acquisition for the project to be able to reach a stage of
production or may otherwise be required to provide it with
sufficient working capital. Such events are likely to be dilutive
to existing shareholders.
Analysis of directors, key employees and employees by sex
Number Male Female
Directors 4 4 0
------- ----- -------
Key Employees 0 0 0
------- ----- -------
Employees 0 0 0
------- ----- -------
Key performance indicators
Bank and cash controls:
Bank reconciliations are prepared at least monthly and reviewed
by the Board. All major items of expenditure are agreed by the
Directors in advance.
There are no other key performance indicators for this period as
the Company has not completed its investment activity.
The Company operates in an uncertain environment and is subject
to a number of risk factors. The Directors have carried out a
robust assessment of the risks and consider the risk factors
outlined above and below in this Strategic Report are of relevance
to the Company's activities, although it should be noted that this
list is not exhaustive and that other risk factors not presently
known or currently deemed immaterial may apply.
These risks were covered from page 14 and 26 of our IPO
Prospectus.
Capital Resources and Returns Management
The Company has raised gross proceeds of GBP830,000 from the
Placing and Subscription. The Directors believe that, following an
Acquisition, further equity capital raisings may be required by the
Company for working capital purposes as the Company pursues its
future objectives. Given that the anticipated operating costs of
the Company will be minimal, the Company does not envisage that
further funding will be required prior to an Acquisition.
It is intended that the purchase price for any potential
Acquisition will be satisfied by way of consideration shares in the
Company or cash consideration (or a combination). By utilising
consideration shares this will enable to Company to conserve cash
resources for working capital purposes. However, whether a further
equity raising will be required and the amount of such raising will
depend on the nature of the Acquisition opportunities which arise
and the form of consideration the Company uses to make an
Acquisition which cannot be determined at this time.
Dividend policy
The Company intends to pay dividends on the Ordinary Shares
following an Acquisition at such times (if any) and in such amounts
(if any) as the Board determines appropriate in its absolute
discretion. Prior to an Acquisition it is unlikely that the Company
will have any earnings but to the extent the Company has any
earnings it is the Company's current intention to retain any such
earnings for use in its business operations, and the Company does
not anticipate declaring any dividends in the foreseeable future.
The Company will only pay dividends to the extent that to do so is
in accordance with all applicable laws.at to do so is in accordance
with all applicable laws.
Corporate governance
The Directors are committed to maintaining high standards of
corporate governance and propose, so far as is practicable given
the Company's size and nature, to voluntarily adopt and comply with
the QCA Code. However, at present, due to the size of the Company,
the Directors acknowledge that adherence to certain other
provisions of the QCA Code may be delayed until such time as the
Directors are able to fully adopt them. In particular, action will
be required in the following areas:
-- the QCA Code recommends that the Company separates the roles
of chairman and executive director. At the date of this Document,
the Chairman is Mr Paul Welch who is an executive director. As the
Company grows, the Board will seek to appoint additional
independent directors, one of whom will be appointed as senior
independent director;
-- the Company is currently too small to have an audit
committee, a remuneration committee or a nominations committee
established and the appointments to such committees will be
revisited upon the completion of an Acquisition along with
incorporating terms of reference for them;
-- Subject to the performance of the Company, the Directors may,
conditional on substantially growing the Group, seek to transfer
the Company from a Standard Listing to either a Premium Listing or
other appropriate listing venue, based on the track record of the
Company and subject to fulfilling the relevant eligibility criteria
at the time. If the Company is successful in obtaining a Premium
Listing or other appropriate listing, further rules will apply to
the Company under the Listing Rules and Disclosure Guidance and
Transparency Rules and the Company will be obliged to comply or
explain any derogation from the UK Corporate Governance Code. In
order to implement its business strategy, as at the date of this
Document, the Company has adopted the corporate governance
structure set out below
To demonstrate the Company's adherence to the QCA Code, the
Company will hold timely board meetings as issues arise which
require the attention of the Board. The Board is responsible for
the management of the business of the Company, setting the
strategic direction of the Company and establishing the policies of
the Company. It is the Directors' responsibility to oversee the
financial position of the Company and monitor the business and
affairs of the Company, on behalf of the Shareholders, to whom they
are accountable. The primary duty of the Directors is to act in the
best interests of the Company at all times. The Board also
addresses issues relating to internal control and the Company's
approach to risk management.
The Board as a whole will be responsible for sourcing
Acquisitions and ensuring that opportunities are in conformity with
the Company's strategy. The Board will meet periodically to: (i)
discuss possible Acquisition opportunities for the Company; (ii)
monitor the deal flow and Acquisitions in progress; and (iii)
review the Company's strategy and ensure that it is up-to-date and
appropriate for the Company and its aims.
Conflicts of Interest
None of the Directors currently has any potential conflict of
interests between their duties to the Company and their private
interests or other duties. However, none of the Directors are
employed by the Company on a full-time basis and as such, conflicts
may arise in the future as a Director may allocate a portion of
their time to other businesses leading to the potential for
conflicts of interest in their determination as to how much time to
devote to the Company's affairs.
Respons i b ili ty statement
This statement is being made by the Chairman Mr. Paul Welch and
to the best of his knowledge:
a. the financial statements, prepared in accordance with the
applicable set of accounting standards, give a true and fair view
of the assets, liabilities, financial position and profit or loss
of the issuer, and
b. the management report includes a fair review of the
development and performance of the business and the position of the
issuer, together with a description of the principal risks and
uncertainties that they face.
Section 172 Statement
As the Board of Directors of ACP Energy PLC, we have a legal responsibility
under section 172 of the Companies Act 2006 to act in the way we consider,
in good faith, would be most likely to promote the company's success
for the benefit of its members as a whole, and to have regard to the
long-term effect of our decisions on the company and its stakeholders.
This statement addresses the ways in which we as a Board fulfil this
responsibility.
Promoting the company's success for its members: ACP Energy PLC was
formed to make one or more acquisitions in the upstream oil and gas
industry. To enable the Company to pursue its principal activity, it
pursued an Initial Public Offering ("IPO") of its shares onto the London
Stock Exchange through a Standard Listing to raise the necessary funds
for the execution of its business strategy. The IPO was successfully
completed and the Company's shares were admitted for trading on 28th
January 2022. Following admission, the Company is now focused on identifying
acquisition opportunities in its chosen sector.
The interests of the company's employees: Our employees are fundamental
to us achieving our long-term strategic objectives.
Our customers and suppliers: The Company has no operating business,
no customers and only a limited number of suppliers. Potential customers,
suppliers and joint venture partners are considered in light of their
suitability to comply with the Company's policies and objectives.
Our community: The Company has no operations that impact any communities.
However, upon a successful acquisition, it will assess its status and
engagement with communities, to ensure that it maintains a high standard
in its activities regarding health, safety and community relations.
It will also work responsibly with suppliers, and actively monitor
performance on an on-going basis.
The environment: The Company currently has a very limited environmental
impact. However, we recognise our environmental responsibilities and
will consider the carbon footprint and other environmental impacts
of any assets that are acquired and investigate measures that may be
taken to reduce them.
Anti-corruption and anti-bribery policy: The Company and its management
recognise and acknowledge the responsibility under English law to promote
success of the Company for the benefits of its stakeholders. The Company
and its management also acknowledge and recognise the responsibility
towards partners, suppliers, contractors, investors, lenders and local
community in which future operational activities will take place. The
Company has four employees, being the directors, all male.
Acts of God and contagious diseases: Acts of God such as seismic activity,
flooding, inclement weather and natural disasters more generally, together
with outbreaks of highly contagious diseases, are beyond the control
of the Company and may adversely affect the economy, infrastructure
and livelihood of people in the countries in which the Company is operating
or proposing to operate. The Company's business and profitability may
be adversely affected should such acts of God and/or outbreaks occur
and/or continue.
On behalf of the board
..............................
Mr J Orbell
Director
Date: 7 October 2022
The directors present their annual report and financial statements
for the period ended 30 June 2022.
Principal activities
The principal activity of the company is intended to be that of
investment in upstream oil and gas assets. The company was incorporated
on 8 April 2021 and did not trade in the period.
Results and dividends
The results for the period are set out on page 11.
No ordinary dividends were paid. The directors do not recommend
payment of a final dividend.
The directors do not recommend payment of a final dividend.
Directors
The directors who held office during the period and up to the date
of signature of the financial statements were as follows:
Mr J Orbell (Appointed 6 May 2021)
Mr S Firth (Appointed 6 May 2021)
Mr J Tyler (Appointed 6 May 2021)
Mr P Welch (Appointed 8 April 2021)
Directors' remuneration for the period was GBP55,445 which includes
an expense of GBP54,732 relating to share based payments
Directors' interests
The directors' interests in the shares of the company were as stated
below:
Ordinary shares
of 0.2p each
Mr P Welch 6,875,000
Mr J Orbell 6,875,000
Mr S Firth 2,500,000
The Company's capital consists of ordinary shares, which rank pari
passu in all respects which are traded on the Standard segment of
the Main Market of the London Stock Exchange. There are no restrictions
on the transfer of securities in the Company or restrictions on
voting rights and none of the Company's shares are owned or controlled
by employee share schemes. There are no arrangements in place between
shareholders that are known to the Company that may restrict voting
rights, restrict transfer of securities, result in the appointment
or replacement of Directors ,amend the Company's Article of Association
or restrict the powers of the company's Directors, including in
relating to the issuing or buying back by the company of its shares
or any significant agreements to which the company is a party that
takes effect after or terminate upon, a change of control of the
Company following a takeover bid or the like. The Founders are all
subject to a 12 month lock-in and orderly market restrictions.
Supplier payment policy
The company's current policy concerning the payment of trade creditors
is to follow the CBI's Prompt Payers Code (copies are available
from the CBI, Centre Point, 103 New Oxford Street, London WC1A 1DU).
The company's current policy concerning the payment of trade creditors
is to:
* settle the terms of payment with suppliers when
agreeing the terms of each transaction;
* ensure that suppliers are made aware of the terms of
payment by inclusion of the relevant terms in
contracts; and
* pay in accordance with the company's contractual and
other legal obligations.
Trade creditors of the company at the year end were GBP15,139.
Substantial Shareholdings
At the date of signing these financial statements, the
shareholders with an interest over 3% were as follows:
Name Holding
Paul Welch 14.8%
James Timothy Orbell 14.8%
Stuart Firth 5.4%
La Tourelle Consulting Limited 14.8%
Blumen Capital Ltd 14.8%
Pershing Nominees 12.9%
Leander Christofides 4.3%
Paris Christofides 4.3%
Greenhouse Gas (GHG) Carbon emission
The Company is currently non-trading with no operating premises
or employees other than its Directors, and therefore has minimum
carbon emissions. Total emissions are expected to be lower than
40,000 Kwh. Accordingly, it is not considered necessary to obtain
emissions, energy consumption or energy efficiency data and produce
an Energy and Carbon Report under SI 2018/1155.
Financial instruments
The company has not entered into any financial instruments to
hedge interest rate or exchange rate risk.
Requirement of the Listing Rules
Listing Rule 9.8.4 requires the Company to include certain
information in a single identification section of the Annual Report
or a cross reference table indicating where the information is set
out. The Directors confirm that there are no disclosures required
in relation to Listing Rule 9.8
Auditor
Jeffreys Henry LLP were appointed as auditor to the company and
in accordance with section 485 of the Companies Act 2006, a
resolution proposing a future appointment will be put forward at a
General Meeting.
Statement of disclosure to auditor
Each director in office at the date of approval of this annual
report confirms that:
-- so far as the director is aware, there is no relevant audit
information of which the company's auditor is unaware, and
-- the director has taken all the steps that he / she ought to
have taken as a director in order to make himself / herself aware
of any relevant audit information and to establish that the
company's auditor is aware of that information.
This confirmation is given and should be interpreted in
accordance with the provisions of section 418 of the Companies Act
2006.
Going Concern
The Group's assets are comprised almost entirely of cash. The
Directors have outlined their strategy for the Group in the Strategic
Report on page 2. As part of their assessment of going concern,
the Directors have prepared cash forecasts that show that the
Group has sufficient cash resources to execute the Company's
strategy.
Based on their enquiries and the information available to them
and taking into account the other risks and uncertainties set
out herein, the Directors have a reasonable expectation that
the Company has adequate resources to continue operating for
the foreseeable future. Thus, they continue to adopt the going
concern basis of accounting in preparing this financial information.
Events after the reporting period
There were no events to disclose.
The directors are responsible for preparing the annual report
and the financial statements in accordance with applicable law
and regulations.
Company law requires the directors to prepare financial statements
for each financial year. Under that law the directors have elected
to prepare the financial statements in accordance with International
Financial Reporting Standards (IFRSs) as adopted by the United
Kingdom. Under company law the directors must not approve the
financial statements unless they are satisfied that they give
a true and fair view of the state of affairs of the company and
of the profit or loss of the company for that period. In preparing
these financial statements, International Accounting Standard
1 requires that directors:
* properly select and apply accounting policies;
* present information, including accounting policies,
in a manner that provides relevant, reliable,
comparable and understandable information;
* provide additional disclosures when compliance with
the specific requirements in IFRSs are insufficient
to enable users to understand the impact of
particular transactions, other events and conditions
on the entity's financial position and financial
performance; and
* make an assessment of the company's ability to
continue as a going concern.
The directors are responsible for keeping adequate accounting
records that are sufficient to show and explain the company's
transactions and disclose with reasonable accuracy at any time
the financial position of the company and enable them to ensure
that the financial statements comply with the Companies Act 2006.
They are also responsible for safeguarding the assets of the
company and hence for taking reasonable steps for the prevention
and detection of fraud and other irregularities.
On behalf of the board
Mr J Orbell
Director
Date: 7 October 2022
Introduction
The information included in this report is not subject to audit
other than where specifically indicated.
Remuneration Committee
The Company is aware of its obligations under the UK Corporate
Governance Code. As it has announced previously, it will set up a
Remuneration Committee once it has commenced its trading activities
and the Committee's function will be to review the performance of
executive directors and senior employees and set their remuneration
and other terms of employment.
The remuneration policy
Each of the Directors shall be paid a fee at such rate as may
from time to time be determined by the Board. Any Director who is
appointed to any executive office shall be entitled to receive such
remuneration (whether by way of salary, commission, participation
in profits or otherwise) as the Board or any committee authorised
by the Board may decide, either in addition to or in lieu of his
remuneration as a Director. In addition, any Director who performs
services which in the opinion of the Board or any committee
authorised by the Board go beyond the ordinary duties of a
Director, may be paid such extra remuneration as the Board or any
committee authorised by the Board may determine.
Recruitment Policy
Base salary levels will take into account market data for the
relevant role, internal relativities, their individual experience
and their current base salary. Where an individual is recruited at
below market norms, they may be re-aligned over time, subject to
performance in the role. Benefits will generally be in accordance
with the approved policy. For external and internal appointments,
the Board may agree that the Company will meet certain relocation
and/or incidental expenses as appropriate.
Service agreements and terms of appointment (audited)
The directors have service contracts with the company. These
contracts are not fixed term and may be terminated by either the
Company or the Director by giving a 3 months' notice.
Directors' interests
The directors' interests in the share capital of the Company are
set out in the Directors' report.
Directors' emoluments
During the period Paul Welsh was the only director that was
employed by the company. An accrual of GBP713 was recognised during
the year relating to his fees and there were no other accrual or
payments relating to Directors' emolument. A further GBP54,732 was
recognised relating to directors share-based payment expense as
follows:
Mr J Orbell
GBP18,246
Mr S Firth GBPNil
Mr J Tyler GBPNil
Mr P Welch GBP36,486
No pension contributions were made by the company on behalf of
its directors, and no excess retirement benefits have been paid out
to current directors.
Payment for loss of Office
If a contract is to be terminated, the Company will determine
such mitigation as it considers
fair and reasonable in each case. The Company reserves the right
to make additional payments where such payments are made in good
faith in discharge of an existing legal obligation (or by way of
damages for breach of such an obligation); or by way of settlement
or compromise of any claim arising in connection with the
termination of an Executive Director's office or employment.
Percentage change tables (audited)
The Directors have considered the requirement for the percentage
change tables comparing the Chairman's percentage change of
remuneration to that of the average employee to not provide any
meaningful information to the shareholders. This is due to the
company not having any employees in this or the prior period with
the exception of the Directors. The Directors will review the
inclusion of this table for future reports.
Company performance graph (audited)
The Directors have considered the requirement for a UK 10-year
performance graph comparing the Company's Total Shareholder Return
with that of a comparable indicator. The Directors do not currently
consider that including the graph will be meaningful because the
Company has only been listed since January 28 2022, is not paying
dividends, is currently in a start-up mode bend whose focus is to
seek an acquisition. In addition, and as mentioned above, the
remuneration of Directors is not currently linked to performance
and we therefore do not consider the inclusion of this graph to be
useful to shareholders at the current time. The Directors will
review the inclusion of this table for future reports.
Other matters
There are no other reportable matters to disclose.
Approval by shareholders
At the next annual general meeting of the company a resolution
approving this report is to be proposed as an ordinary resolution.
The Board considers shareholder feedback received and guidance from
shareholder bodies. This feedback, plus any additional feedback
received from time to time, is considered as part of the Company's
annual policy on remuneration.
On behalf of the board
Paul Welch, Executive Chairman
Date: 7 October 2022
INDEPENT AUDITOR'S REPORT TO THE MEMBERS OF
ACP ENERGY PLC
FOR THE PERIODED 30 JUNE 2022
Opinion
We have audited the financial statements of ACP Energy Plc (the
'Company') for the period ended 30 June 2022 which comprise the
statement of income, the statements of financial position, the
statement of cash flows, the statement of changes in equity and
notes to the financial statements, including a summary of
significant accounting policies. The financial reporting framework
that has been applied in their preparation is applicable law and UK
adopted International Accounting Standards.("IFRS")
In our opinion the financial statements:
-- give a true and fair view of the state of the Company's
affairs as at 30 June 2022 and of the loss for the period then
ended;
-- have been properly prepared in accordance with UK-adopted
International Accounting Standards; and
-- have been prepared in accordance with the requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International
Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our
responsibilities under those standards are further described in the
Auditor's responsibilities for the audit of the financial
statements section of our report. We are independent of the Company
in accordance with the ethical requirements that are relevant to
our audit of the financial statements in the UK, including the
FRC's Ethical Standard as applied to listed entities, and we have
fulfilled our other ethical responsibilities in accordance with
these requirements.
We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statement, we have concluded that the
directors' use of the going concern basis of accounting in the
preparation of the financial statements is appropriate. Our
evaluation of the directors' assessment of the company's ability to
continue to adopt the going concern basis of accounting included
reviewing the forecasts covering the going concern period, and
ascertaining the latest cash position.
Based on the work we have performed, we have not identified any
material uncertainties relating to events or conditions that,
individually or collectively, may cast significant doubt on the
company's ability to continue as a going concern for a period of at
least twelve months form when the financial statements are
authorised for issue
Our responsibilities and the responsibilities of the directors
with respect to going concern are described in the relevant
sections of this report
Key audit matters
Key audit matters are those matters that, in our professional
judgment, were of most significance in our audit of the financial
statements of the current period and include the most significant
assessed risks of material misstatement (whether or not due to
fraud) we identified, including those which had the greatest effect
on the overall audit strategy, the allocation of resources in the
audit and directing the efforts of the engagement team. These
matters were addressed in the context of our audit of the financial
statements as a whole, and in forming our opinion thereon, and we
do not provide a separate opinion on these matters.
This is not a complete list of all risks identified by our
audit.
-- Valuation of share-based payments transactions
These are explained in more detail below:
Key audit matter How our audit addressed the
key audit matter
Valuation of share-based payments We undertook the following audit
transactions procedures, amongst others:
The Company provided options * Compared the terms and conditions for a sample of the
to the directors and warrants options issued during the financial period included
to non-employee service providers, in the valuations with appropriate Board minutes and
whereby the external service letters of advice to the service providers.
providers and the directors render
services and receive rights to
acquire shares of the Company
at a specified price. These share-based * Compared the option grant date used in the valuations
payment transactions are classified to option certificates and agreements.
by the Company as an equity-settled
share-based payment transactions.
The Company valued the options * Obtained the options valuation workings and assessed
and warrants using the Black the reasonableness of selected inputs used in
Scholes model, where inputs such valuation, agreeing the inputs to publicly available
as volatility, dividend yield, information, where possible.
risk-free rate and adjustments
for sub-optimal exercises are
factored in to derive the valuation
of the warrants. These factors * Assessed attributes, on a sample basis, in respect of
are subjective in nature and the valuation of the warrants. Ascertained whether
require management to make judgements these attributes were appropriately included in the
on the estimates to be used in warrant valuation model, and the expense is
the valuation of the warrants. recognised over the appropriate vesting period.
The accounting for share-based
payments is a key audit matter
because the expense recognised * Assessed the reasonableness of the fair value
in the financial statements is calculation through re-performing the calculation
material in nature and monetary using the Black Scholes model.
value, the impact on the profit
and loss account being a charge
of GBP134,686 for the period
and impact on the share premium * Evaluated the adequacy of disclosures made by the
account being GBP94,503. Company in the financial statements in accordance
with the requirements of IFRSs.
There is a risk that the estimates
used in the valuation may be
inconsistent with the factors
surrounding the business, therefore, Based on the audit work carried
the valuation may be materially performed, we are satisfied that
misstated. There is also a risk the assumptions and judgements
that the disclosures in the financial used in the valuation of the
statements are not in accordance options and warrants are appropriate,
with IFRSs. the calculations are free from
material misstatement and appropriate
disclosures have been made in
accordance with IFRSs.
Our application of materiality
The scope of our audit was influenced by our application of
materiality. We set certain quantitative thresholds for
materiality. These, together with qualitative considerations,
helped us to determine the scope of our audit and the nature,
timing and extent of our audit procedures on the individual
financial statement line items and disclosures and in evaluating
the effect of misstatements, both individually and in aggregate on
the financial statements as a whole.
Based on our professional judgment, we determined materiality
for the financial statements as a whole as follows:
Company financial statements
Overall materiality GBP14,000
----------------------------------------------
How we determined 5% of net loss rounded to the nearest GBP'000
it
----------------------------------------------
Rationale for We believe that gross assets are the primary
benchmark applied measure used by shareholders in assessing
the position and performance of the Company
at the end of the period. Gross assets are
generally accepted auditing benchmarks.
----------------------------------------------
We agreed with the Board of Directors that we would report to
them misstatements identified during our audit above GBP700 as well
as misstatements below those amounts that, in our view, warranted
reporting for qualitative reasons.
An overview of the scope of our audit
As part of designing our audit, we determined materiality and
assessed the risks of material misstatement in the financial
statements. In particular, we looked at where the Directors made
subjective judgments, for example in respect of significant
accounting estimates that involved making assumptions and
considering future events that are inherently uncertain. As in all
of our audits we also addressed the risk of management override of
internal controls, including evaluating whether there was evidence
of bias by the directors that represented a risk of material
misstatement due to fraud.
How we tailored the audit scope
We tailored the scope of our audit to ensure that we performed
enough work to be able to give an opinion on the financial
statements as a whole, taking into account the structure of the
Company, its accounting processes, its internal controls and the
industry in which it operates.
Other information
The directors are responsible for the other information. The
other information comprises the information included in the annual
report, other than the financial statements and our auditor's
report thereon. Our opinion on the financial statements does not
cover the other information and, except to the extent otherwise
explicitly stated in our report, we do not express any form of
assurance conclusion thereon.
In connection with our audit of the financial statements, our
responsibility is to read the other information and, in doing so,
consider whether the other information is materially inconsistent
with the financial statements or our knowledge obtained in the
audit or otherwise appears to be materially misstated. If we
identify such material inconsistencies or apparent material
misstatements, we are required to determine whether there is a
material misstatement in the financial statements or a material
misstatement of the other information. If, based on the work we
have performed, we conclude that there is a material misstatement
of this other information, we are required to report that fact. We
have nothing to report in this regard.
Opinion on other matters prescribed by the Companies Act
2006
In our opinion the part of the directors' remuneration report to
be audited has been properly prepared in accordance with the
Companies Act 2006.
In our opinion, based on the work undertaken in the course of
the audit:
-- the information given in the strategic report and the
directors' report for the financial period for which the financial
statements are prepared is consistent with the financial
statements; and
-- the strategic report and the directors' report have been
prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the Company
and its environment obtained in the course of the audit, we have
not identified material misstatements in the strategic report or
the directors' report.
We have nothing to report in respect of the following matters in
relation to which the Companies Act 2006 requires us to report to
you if, in our opinion:
-- adequate accounting records have not been kept by the
Company, or returns adequate for our audit have not been received
from branches not visited by us; or
-- the Company financial statements and the directors'
remuneration report to be audited are not in agreement with the
accounting records and returns; or
-- certain disclosures of directors' remuneration specified by law are not made; or
-- we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors' responsibilities
statement set out on page 11, the directors are responsible for the
preparation of the financial statements and for being satisfied
that they give a true and fair view, and for such internal control
as the directors determine is necessary to enable the preparation
of financial statements that are free from material misstatement,
whether due to fraud or error.
In preparing the financial statements, the directors are
responsible for assessing the Company's ability to continue as a
going concern, disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting unless the
directors either intend to liquidate the Company or to cease
operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial
statements
Our objectives are to obtain reasonable assurance about whether
the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an
auditor's report that includes our opinion. Reasonable assurance is
a high level of assurance but is not a guarantee that an audit
conducted in accordance with ISAs (UK) will always detect a
material misstatement when it exists. Misstatements can arise from
fraud or error and are considered material if, individually or in
the aggregate, they could reasonably be expected to influence the
economic decisions of users taken on the basis of these financial
statements.
Irregularities, including fraud, are instances of non-compliance
with laws and regulations. We design procedures in line with our
responsibilities, outlined above and on the Financial Reporting
Council's website, to detect material misstatements in respect of
irregularities, including fraud.
The extent to which the audit was considered capable of
detecting irregularities, including fraud
Our approach to identifying and assessing the risks of material
misstatement in respect of irregularities, including fraud and
non-compliance with laws and regulations, was as follows:
-- the senior statutory auditor ensured the engagement team
collectively had the appropriate competence, capabilities and
skills to identify or recognise non-compliance with applicable laws
and regulations;
-- we identified the laws and regulations applicable to the
Company through discussions with the Directors, and from our
commercial knowledge and experience of the sector.
-- we focused on specific laws and regulations which we
considered may have a direct material effect on the financial
statements or the operations of the Company, including Companies
Act 2006, taxation legislation, data protection, anti-bribery,
employment, environmental, health and safety legislation and
anti-money laundering regulations.
-- we assessed the extent of compliance with the laws and
regulations identified above through making enquiries of management
and inspecting legal correspondence; and
-- identified laws and regulations were communicated within the
audit team regularly and the team remained alert to instances of
non-compliance throughout the audit.
We assessed the susceptibility of the Company's financial
statements to material misstatement, including obtaining an
understanding of how fraud might occur, by:
-- making enquiries of management as to where they considered
there was susceptibility to fraud, their knowledge of actual,
suspected and alleged fraud;
-- considering the internal controls in place to mitigate risks
of fraud and non-compliance with laws and regulations.
To address the risk of fraud through management bias and
override of controls, we:
-- performed analytical procedures to identify any unusual or unexpected relationships;
-- tested journal entries to identify unusual transactions;
-- assessed whether judgements and assumptions made in
determining the accounting estimates set out in Note 3 of the
Company financial statements were indicative of potential bias;
-- investigated the rationale behind significant or unusual transactions.
In response to the risk of irregularities and non-compliance
with laws and regulations, we designed procedures which included,
but were not limited to:
-- agreeing financial statement disclosures to underlying supporting documentation;
-- reading the minutes of meetings of those charged with governance;
-- enquiring of management as to actual and potential litigation and claims;
-- reviewing correspondence with HMRC and the Company's legal advisor.
There are inherent limitations in our audit procedures described
above. The more removed the laws and regulations are from financial
transactions, the less likely it is that we would become aware of
non-compliance. Auditing standards also limit the audit procedures
required to identify non-compliance with laws and regulations to
enquiry of the directors and other management and the inspection of
regulatory and legal correspondence, if any.
Material misstatements that arise due to fraud can be harder to
detect than those that arise from error as they may involve
deliberate concealment or collusion.
A further description of our responsibilities for the audit of
the financial statements is located on the Financial Reporting
Council's website at: www.frc.org.uk/auditorsresponsibilities .
This description forms part of our auditor's report.
Other matters which we are required to address
We were appointed by the Board of Directors on 11 August 2022 to
audit the financial statements for the period ending 30 June 2022.
Our total uninterrupted period of engagement is 1 period, covering
the period ending 30 June 2022.
The non-audit services prohibited by the FRC's Ethical Standard
were not provided to Company and we remain independent of the
Company in conducting our audit.
Our audit opinion is consistent with the additional report to
the Board of Directors.
Use of this report
This report is made solely to the Company's members, as a body,
in accordance with Chapter 3 of Part 16 of the Companies Act 2006.
Our audit work has been undertaken so that we might state to the
Company's members those matters we are required to state to them in
an auditor's report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility to
anyone other than the Company and the Company's members as a body,
for our audit work, for this report, or for the opinions we have
formed.
Sanjay Parmar (Senior Statutory Auditor)
For and on behalf of Jeffreys Henry LLP (Statutory Auditors)
Finsgate
5-7 Cranwood Street
London EC1V 9EE
7 October 2022
Period
ended
30 June
2022
Notes GBP
Administrative expenses (144,340)
Exceptional items - share-based payments (134,686)
Operating (loss)/profit 4 (279,026)
Income tax expense 7 -
(Loss)/profit and total comprehensive income
for the period (279,026)
Earnings per share 8
Basic (0.62)
Diluted (0.62)
2022
Notes GBP
ASSETS
Current assets
Trade and other receivables 10 40,022
Cash and cash equivalents 599,876
639,898
Total assets 639,898
EQUITY
Called up share capital 17 93,200
Share premium account 18 560,183
Other reserves 19 229,189
Retained earnings (279,026)
Total equity 603,546
LIABILITIES
Current liabilities
Trade and other payables 15 36,352
Total liabilities 36,352
Total equity and liabilities 639,898
The financial statements were approved by the board of directors
and authorised for issue on 7 October 2022 and are signed on its
behalf by:
..............................
Mr J Orbell
Director
Company registration number 13322549
Share Share premium Other Retained Total
capital account reserves earnings
Notes GBP GBP GBP GBP GBP
Balance at 8 April 2021 - - - -
Period ended 30 June 2022:
Loss and total comprehensive
income for the period - - (279,026) (279,026)
Transactions with owners
in their capacity as owners:
Issue of share capital 17 93,200 560,183 - 653,383
Share-based payments 19 229,189 229,189
Balance at 30 June 2022 93,200 560,183 229,189 (279,026) 603,546
-------- ------------- --------- --------- ---------
2022
Notes GBP GBP
Cash flows from operating activities
Cash absorbed by operations 21 (148,010)
Net cash outflow from operating activities (148,010)
Financing activities
Proceeds from issue of shares 890,000
Share issue costs (142,114)
Net cash generated from/(used in) financing
activities 747,886
Net increase in cash and cash equivalents 599,876
Cash and cash equivalents at beginning of period -
Cash and cash equivalents at end of period 599,876
1 Accounting policies
Company information
ACP Energy Plc is a public company limited by shares incorporated
in England and Wales. The registered office is 21 High Street,
Lutterworth, LE17 4AT. The company's principal activities and
nature of its operations are disclosed in the directors' report.
1.1 Accounting convention
The financial statements have been prepared in accordance with
UK- adopted International Financial Reporting Standards (IFRS)
and with those parts of the Companies Act 2006 applicable to
companies reporting under IFRS, except as otherwise stated.
The financial statements are prepared in sterling, which is
the functional currency of the company. Monetary amounts in
these financial statements are rounded to the nearest GBP.
The financial statements have been prepared under the historical
cost convention. The principal accounting policies adopted are
set out below.
1.2 Going concern
The directors have at the time of approving the financial statements,
a reasonable expectation that the company has adequate resources
to continue in operational existence for the foreseeable future.
Thus, the directors have adopted the going concern basis of
accounting in preparing the financial statements.
At the end of the period, the Company is in a significant net
asset position of GBP603,546. At 30th June 2022, the Company
has a cash balance of GBP599,876. Based on the forecasted expenditure
for the period to 31 October 2023, the Directors are of that
the company will have sufficient cash for the foreseeable future.
The Directors are therefore of the opinion that the Company
has adequate resources to enable it to continue in operation
for the foreseeable future. For this reason, it continues to
adopt the going concern basis in preparing the financial statements
1.3 Cash and cash equivalents
Cash and cash equivalents include cash in hand, deposits held
at call with banks, other short-term liquid investments with
original maturities of three months or less, and bank overdrafts.
Bank overdrafts are shown within borrowings in current liabilities.
1.4 Financial assets
Financial assets are recognised in the company's statement of
financial position when the company becomes party to the contractual
provisions of the instrument. Financial assets are classified
into specified categories, depending on the nature and purpose
of the financial assets.
At initial recognition, financial assets classified as fair
value through profit and loss are measured at fair value and
any transaction costs are recognised in profit or loss. Financial
assets not classified as fair value through profit and loss
are initially measured at fair value plus transaction costs.
Financial assets held at amortised cost
Financial instruments are classified as financial assets measured
at amortised cost where the objective is to hold these assets
in order to collect contractual cash flows, and the contractual
cash flows are solely payments of principal and interest. They
can arise from the provision of goods and services to customers
(eg trade receivables). They are initially recognised at fair
value plus transaction costs directly attributable to their
acquisition or issue, and are subsequently carried at amortised
cost using the effective interest rate method, less provision
for impairment where necessary.
Impairment of financial assets
Financial assets, other than those measured at fair value through
profit or loss, are assessed for indicators of impairment at
each reporting end date. Financial assets are impaired where
there is objective evidence that, as a result of one or more
events that occurred after the initial recognition of the financial
asset, the estimated future cash flows of the investment have
been affected.
1 Accounting policies
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights
to the cash flows from the asset expire, or when it transfers
the financial asset and substantially all the risks and rewards
of ownership to another entity.
1.5 Financial liabilities
The company recognises financial debt when the company becomes
a party to the contractual provisions of the instruments.
Other financial liabilities
Other financial liabilities, including borrowings, trade payables
and other short-term monetary liabilities, are initially measured
at fair value net of transaction costs directly attributable
to the issuance of the financial liability. They are subsequently
measured at amortised cost using the effective interest method.
For the purposes of each financial liability, interest expense
includes initial transaction costs and any premium payable on
redemption, as well as any interest or coupon payable while the
liability is outstanding.
Derecognition of financial liabilities
Financial liabilities are derecognised when, and only when, the
company's obligations are discharged, cancelled, or they expire.
1.6 Equity instruments
Equity instruments issued by the company are recorded at the
proceeds received, net of direct issue costs. Dividends payable
on equity instruments are recognised as liabilities once they
are no longer at the discretion of the company.
1.7 Taxation
The tax expense represents the sum of the tax currently payable
and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the
year. 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 years 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 end
date.
Deferred tax
Deferred tax is the tax expected to be payable or recoverable
on differences between the carrying amounts of assets and liabilities
in the financial statements and the corresponding tax bases used
in the computation of taxable profit, and is accounted for using
the balance sheet liability method. Deferred tax liabilities
are generally recognised for all taxable temporary differences
and deferred tax assets are recognised to the extent that it
is probable that taxable profits will be available against which
deductible temporary differences can be utilised. Such assets
and liabilities are not recognised if the temporary difference
arises from goodwill or from the initial recognition of other
assets and liabilities in a transaction that affects neither
the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each
reporting end 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 asset to be recovered. Deferred tax
is calculated at the tax rates that are expected to apply in
the period when the liability is settled or the asset is realised.
Deferred tax is charged or credited in the income statement,
except when it relates to items charged or credited directly
to equity, in which case the deferred tax is also dealt with
in equity. Deferred tax assets and liabilities are offset when
the company has a legally enforceable right to offset current
tax assets and liabilities and the deferred tax assets and liabilities
relate to taxes levied by the same tax authority.
1 Accounting policies
1.8 Employee benefits
The cost of short-term employee benefits are recognised as a
liability and an expense, unless these cost are required to be
recognised as part of the cost of inventories or non-current
assets.
The cost of any unused holiday entitlement is recognised in the
period in which the employee's services are received.
Termination benefits are recognised immediately as an expense
when the Company is demonstrably committed to terminate the employment
of an employee or to provide termination benefits.
1.9 Share-based payments
Equity-settled share-based payments are measured at fair-value
at the date of grant by reference to the fair value of the equity
instrument granted using the Black-Scholes model. The fair value
determined at the grant date is expensed on a straight-line basis
over the vesting period, based on the estimate of shares that
will eventually vest. A corresponding adjustment is made to equity.
When the terms and conditions of equity-settled share-based payments
at the time they were granted are subsequently modified, the
fair value of the original fair value is recognised over the
remaining vesting period in addition to the grant date fair value
of the original share-based payment. The share-based payment
expense is not adjusted if the modified fair value is less than
the original fair value.
Cancellation or settlement (including those resulting from employee
redundancies) are treated as an acceleration of vesting and the
amount that would have recognised over the remaining vesting
period is recognised immediately.
1.9 Foreign exchange
Transactions in currencies other than pound sterling are recorded
at the rates of exchange prevailing at the dates of the transactions.
At each reporting end date, monetary assets and liabilities that
are denominated in foreign currencies are retranslated at the
rates prevailing on the reporting end date. Gains and losses
arising on translation in the period are included in profit or
loss.
2 Adoption of new and revised standards and changes in accounting
policies
In the current period, the following new and revised Standards
and Interpretations have been adopted by the company and have
an effect on the current period or may have an effect on future
periods:
IAS 1 Amendments to IAS 1 to clarify
the classification of liabilities
as current or non-current.
3 Critical accounting estimates and judgements
In the application of the company's accounting policies, the
directors are required to make judgements, estimates and assumptions
about the carrying amount of assets and liabilities that are
not readily apparent from other sources. The estimates and associated
assumptions are based on historical experience and other factors
that are considered to be relevant. Actual results may differ
from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing
basis. Revisions to accounting estimates are recognised in the
period in which the estimate is revised, if the revision affects
only that period, or in the period of the revision and future
periods if the revision affects both current and future periods.
There are no estimates and assumptions that have a significant
risk of causing a material adjustment to the carrying amounts
of assets and liabilities within the next financial year.
4 Operating loss
Period
ended 30
June 2022
Operating loss for the period is stated after charging/(crediting): GBP
Fees payable to the company's auditor for the audit
of the company's financial statements 15,000
5 Employees
The average monthly number of persons employed by the company
during the period including directors was:
Period
ended 30
June 2022
Number
Directors 4
Their aggregate remuneration comprised:
Period
ended 30
June 2022
GBP
Directors emoluments 55,445
6 Directors' remuneration
Period ended
30 June 2022
GBP
Remuneration for qualifying services 713
Share based payment expense 54,732
-------------
7 Income tax expense
The charge for the period can be reconciled to the loss per the
income statement as follows:
Period ended
30 June 2022
GBP
Loss before taxation (279,026)
Expected tax credit based on a corporation tax rate
of 19.00% (53,015)
Effect of expenses not deductible in determining taxable
profit 25,590
Change in unrecognised deferred tax assets 27,425
Taxation charge for the period -
The excess management expenses carried forward at 30
June 2022 were GBP144,342.
8 Earnings per share
Period ended
30 June 2022
Number
Number of shares
Weighted average number of ordinary shares for basic
earnings per share 44,996,347
Period ended
30 June 2022
Earnings (all attributable to equity shareholders GBP
of the company)
Continuing operations
Loss/profit for the period from continued operations (279,026)
Pence per
share
Basic and diluted earnings per share
From continuing operations (0.62)
Basic earnings per share is calculated by dividing the earnings
attributable to ordinary shareholders by the weighted average
number of shares outstanding during the period. Diluted earnings
per share is calculated on the same basis as basic earnings per
share but with a further adjustment for the weighted average
shares in issue to reflect the effect of all dilutive potential
ordinary shares. There are no dilutive potential ordinary shares,
so the diluted earnings per share is equal to the basic earnings
per share.
9 Credit risk
Cash deposits and financial transactions give rise to credit
risk in the event that counter parties fail to perform under
the contract. Given the level of cash deposits and financial
assets within these financial statements, the probability of
material loss is considered to be at an acceptable level.
The carrying amount of financial assets recorded in the financial
statements, which is net of impairment losses, represents the
company's maximum exposure to credit risk.
The company does not hold any collateral or other credit enhancements
to cover this credit risk.
10 Trade and other receivables
2022
GBP
VAT recoverable 21,097
Prepayments 18,925
40,022
11 Trade receivables - credit risk
Fair value of trade receivables
The directors consider that the carrying amount of trade and
other receivables is approximately equal to their fair value.
No significant receivable balances are impaired at the reporting
end date.
12 Fair value of financial liabilities
The directors consider that the carrying amounts of financial
liabilities carried at amortised cost in the financial statements
approximate to their fair values.
13 Liquidity risk
The following table details the remaining contractual maturity
for the company's financial liabilities with agreed repayment
periods. The contractual maturity is based on the earliest date
on which the company may be required to pay.
Less than 1 - 3 months Total
1 month
GBP GBP GBP
At 30 June 2022
Trade payables 15,139 - 15,139
Accruals - 21,213 21,213
15,139 21,213 36,352
13 Liquidity risk
Liquidity risk management
Responsibility for liquidity risk management rests with the board
of directors. The company manages liquidity risk by maintaining
adequate reserves, by continuously monitoring forecast and actual
cash flows, and by matching the maturity profiles of financial
assets and liabilities.
14 Market risk
The company is not exposed to the financial risks of changes
in foreign currency exchange rates and interest rates. It is
also not affected by interest rate benchmark reform.
15 Trade and other payables
2022
GBP
Trade payables 15,139
Accruals 21,213
36,352
16 Deferred taxation
No deferred tax asset has been recognised in respect of the excess
management expenses amounting to GBP144,342 as it is not considered
virtually certain that there will be future taxable profits available
in the foreseeable future. These deductible temporary differences
may be carried forward indefinitely.
17 Share capital
2022 2022
Ordinary share capital Number GBP
Issued and fully paid
Ordinary shares of 0.2p each 46,600,000 93,200
Reconciliation of movements during the period:
Ordinary
shares
Number
At 8 April 2021 -
Issue of fully paid shares 46,600,000
At 30 June 2022 46,600,000
17 Share capital
On incorporation, the company issued 3,000 ordinary shares of
GBP0.10 for consideration of GBP300 cash. On 6th July 2021, the
company sub-divided the 3,000 shares into 150,000 ordinary shares
with par value of GBP0.002 per share and issued 29,850,000 ordinary
shares at a price of GBP0.002 per share for a total cash consideration
of GBP59,700. On 28th January 2022, the company issued a further
16,600,000 ordinary shares with par value of GBP0.002 per share
for a total consideration of GBP830,000. Share issue expenses
totalling GBP142,114 were incurred relating to this issue and
are deducted from the company's share premium (see note 18).
The ordinary shares have full rights in the company with respect
to voting, dividends and distributions.
18 Share premium account
2022
GBP
At the beginning of the period -
Issue of new shares 796,800
Share issue expenses (142,114)
Share-based payments (Note 19) (94,503)
At the end of the period 560,183
19 Share-based payment transactions
24,998,950 options and 5,548,000 warrants over GBP0.002 ordinary
shares in the Company were issued on 21(st) January. A further
6,000,000 warrants were issued on 2(nd) March 2022 in respect
of services provided in the reporting period.
The options and warrants issued on 21(st) January 2022 were in
respect of services provided in the period . Therefore, share-based
payment expense has been recognised in these financial statements
amounting to GBP229,189. The warrants issued on 2(nd) March 2022
were in respect of IPO, and expenses totalling GBP94,503 are
deducted from the company's share premium.
The table below summarises the options granted, exercised and
cancelled during the period: Number Number Weighted average
of options of warrants exercise price
2022 2022 2022
Outstanding at 8 April
2021
Granted in the period 24,998,950.00 0.01
11,548,000.00 0.0625
Outstanding as at 30
June 2022 24,998,950.00 11,548,000.00 0.02
============== ============== =================
Exercisable at 30 June
2022 24,998,950.00 11,548,000.00 0.02
-------------- -------------- -----------------
The options issued during the period vest on over 3 years on
the RTO . The warrants vested on the date of the grant.
19 Share-based payment transactions (Continued)
The weighted average fair value of the options and warrants on
the measurement date was GBP0.0350 and GBP0.0088 respectively. The
weighted average exercise price was GBP0.01 for options and
GBP0.0625 for warrants.
Inputs were as follows:
2022
-------------------------
Pool 1 Pool 2 Pool 3
Weighted average share price 0.065 0.065 0.067
Weighted average exercise price 0.01 0.0625 0.0625
Expected volatility 60% 60% 60%
Expected life 2 3 2
Expected dividend yields - - -
V olatility was calculated based upon the anticipated volatility
of newly listed companies of a similar market capitalisation and
number of shareholders.
Capital risk management
20
The company manages its capital to ensure that it will be able
to continue as a going concern while maximising the return to
stakeholders
through the optimisation of the debt and equity balance,
The capital structure of the company consists of cash and cash
equivalents and equity comprising share capital, reserves and
retained
earnings. The company reviews the capital structure annually and
as part of this review considers that cost of capital and the risks
associated with each class of capital.
The company is not subject to any externally imposed capital
requirements.
Cash absorbed by operations
21
2022
GBP
Loss for the period before income tax (279,026)
Share based payment expense 134,686
Movements in working capital:
Increase in trade and other
receivables (40,022)
Increase in trade and other payables 36,352
Cash absorbed by operations (148,010)
-------------------------------
2022
GBP
Other reserves
Other reserves arising from share-based payment transactions 229,189
Relates to equity settled share-based payments 94,503
The expected life used in the model has been adjusted, based on
management's best estimate, for the effects of non-transferability,
exercise restrictions and behavioural considerations.
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END
ACSBKCBPOBDDOKK
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