TIDMTEK
RNS Number : 1818Q
Tekcapital plc
28 August 2014
28 August 2014
Tekcapital Plc
("Tekcapital", "the Company" or "the Group")
Unaudited Interim Results
for the six months ended 31 May 2014
Tekcapital plc (AIM: TEK), an international provider of
technology and intellectual property services, announces its
unaudited interim results for the six months ended 31 May 2014.
Highlights
- IPO successfully completed in April 2014 raising gross proceeds of GBP2 million
- The number of retained clients increased by 30% since flotation
- Strong progress made towards the strategic objectives as set
out in the IPO Admission Document as follows:
o expansion of the Company's sales and marketing team
o recruitment of additional support staff
o expansion of the service offering
o extension of Tekcapital's international reach
- New offices opened in Florida, Singapore and London
- Science Advisory Board strengthened further with seven new
appointments to enhance the Company's offering in several
industries
- Strategic partnership formed with Blick Rothenberg and
Cleveland IP to provide a solution to help U.K. companies benefit
from the Patent Box tax law
- Post period end, completion of the acquisition of InventionEvaluator.com
- Cash at 31 May 2014 of GBP1.3 million
Commenting on the results, Dr. Clifford Gross, Executive
Chairman of Tekcapital plc, said:
"We have made solid progress towards a number of the goals that
we set out when we came to market in April 2014. During the first
half, we have made significant progress in establishing a
foundation for achieving future growth including the opening of
small office hubs in Miami, London and Singapore, hiring new sales
representatives, developing initiatives to work with new strategic
partners and expanding our scientific advisory board. This solid
foundation gives us confidence in our future prospects for both
growing the business and facilitating the creation of marketplace
value and profits from university intellectual capital for our
clients."
For further information please contact:
Tekcapital Plc +44 1865 261445
Malcolm Groat, Finance Director mgroat@tekcapital.com
Northland Capital Partners Limited
(NOMAD & Broker) +44 (0) 20 7382 1100
William Vandyk / Lauren Kettle (Corporate
Finance) lkettle@northlandcp.co.uk
John Howes / Alice Lane (Corporate
Broking)
Optiva Securities Limited (Co-Broker) +44 (0) 20 3137 1904
Jeremy King / Vishal Balasingham jeremy.king@optivasecurities.com
FTI Consulting, LLP +44 (0) 20 3727 1000
Chris Lane / Emma Appleton / Roger
Newby tekcapital@fticonsulting.com
Tekcapital plc - The World's Largest University Network for Open
Innovation
Tekcapital helps clients profit from new, university-developed
intellectual properties. With our proprietary discovery search
engine, linked to 3,300+ universities in 160 countries, coupled
with expert scientific review, we provide a turn-key service to
make it easy for clients to find and acquire the IP they need to
create a competitive advantage. Tekcapital plc is listed on the AIM
market of the London Stock Exchange (AIM: symbol TEK) and is
headquartered in Oxford, in the UK. For more information, please
visit www.tekcapital.com
Chairman's statement
I am pleased to report our first set of results since our
admission to AIM on 4 April 2014. As we stated prior to our
flotation, many companies are now seeking to identify and to
acquire intellectual property ("IP") from external or alternative
sources in order to protect and grow their respective businesses.
Tekcapital undertook its admission to AIM to enable the Company to
build upon our first mover status, to take advantage of the
increasing interest in our sector and ultimately to enable our
clients to efficiently and more quickly source and acquire suitable
IP candidates.
Our strategy, as laid out in our Admission Document, is to scale
the business up to enable us to provide our service offering to a
wide range of clients throughout the world, with an initial
concentration on the UK and North American markets. The other part
of our strategy focused on adding additional services, either
organically or through accretive acquisitions, with the aim of
enabling the Group to assist its clients further in determining and
extracting value from IP and the transformative innovations they
represent.
I am pleased to report that, as planned we have begun to scale
our sales operations and have also started to leverage other
channels to expand our service offering.
Our initial focus has been to establish the basis for achieving
solid and rapid growth. In May 2014, we successfully:
-- opened small offices as hubs in Miami, London, and Singapore;
-- hired new sales representatives;
-- developed new initiatives to work with new strategic partners; and
-- expanded our scientific advisory board to strengthen our
offering in several industries, enabling us to more broadly
approach the Asian market and network with potential new
businesses, clients and analysts in a variety of relevant
conferences, technology forums and investor groups.
Tekcapital now has 10 retained clients, which include a mix of
private companies and public companies which are listed on various
stock exchanges, including the NYSE. To meet current demand for our
services and to support the continued growth of our business, we
have made several key hires to strengthen further our technology
transfer and client services teams, including the appointment of
James Deane as Managing Director of Technology Transfer (Physical
Sciences and Low Carbon Technologies) and Amy Shim as Director of
Client Services (California).
As promised, we have also upgraded our proprietary global
innovation discovery network ("IDN") search engine which is capable
of identifying IP acquisition opportunities relevant to the
client's search parameters in our global database of universities
and research institutions. We have upgraded the IDN in terms of the
number of institutions covered worldwide, the depth of search, and
developed an additional facility to conduct group searches.
Finally, post period end and in line with our stated strategy we
identified and successfully acquired a complementary service
offering to assist our clients to determine and extract value from
IP. InventionEvaluator.com ("Invention Evaluator") provides to its
clients a high quality bespoke report which contains an in-depth
analysis of the commercial opportunity associated with a specific
new innovation. The service has already been integrated with our
existing offering and is receiving interest from Tekcapital's
clients who are considering IP acquisitions.
Current trading and outlook
Having widened our service range, extended our market presence,
and raised our profile, we expect to see net growth in our client
list in the period from June to November 2014.
The post period end acquisition of Invention Evaluator has also
added a new, exciting dimension to our offering and in the month
since the transaction closed there have been reports delivered to
more than 30 organisations around the world.
I would like to take this opportunity to thank our shareholders
for supporting us to date and we look forward to delivering on our
goal to help our clients create market value and profit from new
university developed technologies and intellectual property. I look
forward to providing a full report on progress with our annual
results for the year to 30 November 2014.
Clifford M. Gross, Ph.D.
Executive Chairman
28 August 2014
Unaudited condensed consolidated statement of comprehensive
income
For the six month period ended 31 May 2014
Operating
performance Total -
- six months six months Six months
ended ended ended
31 May 31 May 31 May
Notes 2014 IPO Costs 2014 2013
Unaudited Unaudited Unaudited Unaudited
GBP GBP GBP GBP
Revenue 30,639 - 30,639 -
Cost of sales (17,839) - (17,839) -
-------------- ---------- ------------ -----------
Gross profit 12,800 12,800 -
Administrative expenses (243,498) (344,768) (588,266) (19,412)
-------------- ---------- ------------ -----------
Loss before taxation (230,698) (344,768) (575,466) (19,412)
Income tax expense 3 - - - -
-------------- ---------- ------------ -----------
Loss after taxation
for the period attributable
to equity holders (230,698) (344,768) (575,466) (19,412)
============== ==========
Basic and diluted loss
per share (GBP): 4 - - (0.03) (0.001)
All amounts relate to continuing operations. There were no
recognised gains or losses for the period other than those
mentioned in the results above.
Unaudited condensed consolidated statement of financial
position
As at 31 May 2014
As at As at As at
Notes 31 May 2014 31 May 2013 30 November
2013
Unaudited Unaudited Unaudited
GBP GBP GBP
Assets
Non-current assets
Property, plant and
equipment 10,396 - -
10,396 -
------------- ------------- -------------
Current assets
Trade and other receivables 63,448 2,517 7,350
Cash and cash equivalents 1,271,061 1,847 8,597
-------------
1,334,509 4,364 15,947
------------- ------------- -------------
Total assets 1,344,905 4,364 15,947
============= ============= =============
Equity and liabilities
Current liabilities
Trade payables 59 - 20,088
Other payables and
accruals 112,641 9,272 -
Loans and borrowings - - 9,413
Total liabilities 112,700 9,272 29,501
---------- --------- ---------
Capital and reserves
Share capital 5 90,016 58,016 58,016
Share premium 1,789,225 - -
Merger reserve (43,512) (43,512) (43,512)
Retained earnings (603,524) (19,412) (28,058)
Total equity attributable
to equity holders of
the parent 1,232,205 (4,908) (13,554)
---------
Total equity and liabilities 1,344,905 4,364 15,947
========== ========= =========
Unaudited condensed consolidated statement of cash flows
For the six month period ended 31 May 2014
Six months Six months
ended ended
31 May 2014 31 May 2013
Unaudited Unaudited
GBP GBP
Cash flows from operating activities
Loss for the period (575,466) (17,455)
Operating profit before working capital
changes: (575,466) (17,455)
Changes in working capital
Increase in trade and other receivables (56,099) (2,457)
Increase in trade and other payables 92,613 -
Net cash used in operating activities (538,952) (19,912)
------------- -------------
Cash flows from investing activities
Acquisition of property, plant and equipment (10,396) -
Net cash used in investing activities (10,396) -
------------- -------------
Cash flows from financing activities
Repayment of loans (9,413) -
Loans from related parties - 16,482
Share issue proceeds net of issue costs 1,821,225 -
Net cash from financing activities 1,811,812 16,482
------------- -------------
Net increase/(decrease) in cash and cash
equivalents 1,262,464 (3,430)
Cash and cash equivalents at the beginning
of the period 8,597 5,277
Cash and cash equivalents at the end of
the period 1,271,061 1,847
============= =============
Unaudited condensed consolidated statement of changes in
equity
For the six month period ended 31 May 2014
Total equity
attributable
to
Share Share Retained Merger equity holders
capital premium earnings reserve of the parent
Unaudited GBP GBP GBP GBP GBP
Balance at 1 December
2013 58,016 - (28,058) (43,512) (13,554)
Issue of ordinary shares,
net of share issue costs 32,000 1,789,225 - - 1,821,225
Loss for the period - - (575,466) - (575,466)
Total comprehensive
income for the period - - (575,466) - (575,466)
--------- ---------- ---------- --------- ----------------
Balance at 31 May 2014 90,016 1,789,225 (603,524) (43,512) 1,232,205
========= ========== ========== ========= ================
Total equity
attributable
to
Share Share Retained Merger equity holders
capital Premium earnings reserve of the parent
Unaudited GBP GBP GBP GBP GBP
Balance at 27 June 2012 58,016 - - (43,512) 14,504
Loss for the period - - (19,412) - (19,412)
Total comprehensive
income for the period - - (19,412) - (19,412)
--------- ---------- ---------- --------- ----------------
Balance at 31 May 2013 58,016 - (19,412) (43,512) (4,908)
========= ========== ========== ========= ================
Share capital represents the amount subscribed for share capital
at nominal value.
Share premium represents the amount subscribed for share capital
in excess of nominal value and net of any issue costs.
The merger reverse relates to the share for share exchange
undertaken by the Company with Tekcapital Europe Limited on 18
February 2014.
Accumulated losses represent all other net gains and losses and
transactions with owners not recognised elsewhere.
Notes to the financial information
1. General information
The Company was incorporated in England, on 3 February 2014. The
Company's registered office is at 5 Fleet Place, London, EC4M 7RD.
The nature of the Company's operations and its principal activities
are to act as the holding company of a group engaged in
international technology and intellectual property services
provider.
2. Basis of preparation
The financial information for the six months ended 31 May 2014
set out in this interim financial information is unaudited and does
not constitute statutory financial statements.
The interim condensed financial information has been presented
in British Pounds Sterling ("GBP").
The financial information for the year ended 30 November 2013
set out in this interim financial information does not comprise the
Group's statutory financial statements, but has been prepared by
consolidating the Company and the consolidated financial statements
of Tekcapital Europe Limited, the subsidiary of the Company. Both
sets of statements were prepared under IFRS and IFRIC
interpretations as adopted by the European Union.
The directors do not propose a dividend for the period.
The directors approved the interim financial information for the
six months ended 31 May 2014 on 28 August 2014.
Copies of this interim financial information will be available
on the Company's website: www.tekcapital.com
The principal accounting policies used in preparing the interim
results are those the Group expects to apply in its financial
statements for the year ending 30 November 2013.
Basis of preparation
"The company was incorporated on 3 February 2014 and entered
into an agreement to acquire the entire issued and to be issued
share capital of Tekcapital Europe Limited on 18 February 2014. The
acquisition was effected by way of issue of shares.
In determining the appropriate accounting treatment for this
transaction, the Directors considered IFRS 3 "Business
Combinations" (Revised 2008). However, they concluded that this
transaction fell outside the scope of IFRS 3 (revised 2008) since
the transaction described above represents a combination of
entities under common control.
In accordance with IAS 8 "Accounting Policies, changes in
accounting estimates and errors", in developing an appropriate
accounting policy, the Directors have considered the pronouncements
of other standard setting bodies and specifically looked to
accounting principles generally accepted in the United Kingdom ("UK
GAAP") for guidance (FRS 6 - Acquisitions and mergers) which does
not conflict with IFRS and reflects the economic substance of the
transaction.
Under UK GAAP, the assets and liabilities of both entities are
recorded at book value, not fair value (although adjustments are
made to achieve uniform accounting policies), intangible assets and
contingent liabilities are recognised only to the extent that they
were recognised by the legal acquirer in accordance within
applicable IFRS, no goodwill is recognised, any expenses of the
combination are written off immediately to the income statement and
comparative amounts, if applicable, are restated as if the
combination had taken place at the beginning of the earliest
accounting period presented.
Therefore, although the Group reconstruction did not become
unconditional until 18 February 2014, these consolidated financial
statements are presented as if the Group structure has always been
in place, including the activity from incorporation of the group's
principal subsidiary. Both entities had the same management as well
as majority shareholders.
Furthermore, as the Company was incorporated on 3 February 2014,
while the enlarged group had been trading previously, the statement
of comprehensive income and consolidated statement of changes in
equity and consolidated cash flow statements are proforma. On this
basis, the Directors have decided that it is appropriate to reflect
the combination using merger accounting principles as a group
reconstruction under FRS 6 - Acquisitions and mergers in order to
give a true and fair view. No fair value adjustments have been made
as a result of the combination."
3. Taxation
No charge to taxation has arisen in the six month period ended
31 May 2014 (31 May 2013: GBPnil).
4. Loss per share
Basic earnings per share is calculated by dividing the earnings
attributable to ordinary shareholders by the weighted average
number of Ordinary Shares outstanding during the period.
In calculating the weighted average number of Ordinary Shares
outstanding (the denominator of the earnings per share calculation)
during the period in which the share for share transaction
occurs:
-- the number of ordinary shares outstanding from the beginning
of that period to the acquisition date shall be computed on the
basis of the weighted average number of Ordinary Shares of the
legal acquiree (accounting acquirer) outstanding during the period
multiplied by the exchange ratio established in the merger
agreement; and
-- the number of Ordinary Shares outstanding from the
acquisition date to the end of that period shall be the actual
number of Ordinary Shares of the legal acquirer (the accounting
acquiree) outstanding during that period.
The basic earnings per share for each comparative period before
the acquisition date presented in the consolidated financial
information following a share for share exchange shall be
calculated by dividing:
-- the profit or loss of the legal acquiree attributable to
ordinary shareholders in each of those periods; by
-- the legal acquiree's historical weighted average number of
Ordinary Shares outstanding multiplied by the exchange ratio
established in the acquisition agreement.
Six months Six months
ended ended
31 May 2014 31 May 2013
GBP GBP
Losses attributable to equity holders
of the Company (GBP) (575,466) (19,412)
Weighted average number of ordinary
shares in issue:
Basic 17,037,309 14,503,976
Diluted 17,037,309 14,503,976
Basic loss per share (GBP) (0.03) (0.001)
Diluted loss per share (GBP) (0.03) (0.001)
At 31 May 2014 and 31 May 2013 the company has no dilutive
financial instruments in place and therefore diluted earnings per
share is the same as basic earnings per share.
5. Share capital
Ordinary shares of GBP0.004 par value
Issued and fully paid Six months ended 31 May 2014
Ordinary shares of
GBP0.004 each Shares Share capital Share premium
Number GBP GBP
As at 1 December 2013 - - -
Issued on incorporation
(3 February 2014) 1 - -
Issued as part of share
for share exchange
(18 February 2014) 14,503,976 58,016 -
Share issue (4 April
2014) 8,000,000 32,000 1,789,225
As at 30 June 2012 22,503,977 90,016 1,789,225
------------- ---------------- --------------
On 4 April 2014, the Company issued 8,000,000 Ordinary shares of
GBP0.004 par value, this was on admission to trading on the AIM
market at GBP0.25 per share. The share issue costs associated with
this transaction have been deducted from the Company's share
premium account and totalled GBP178,775.
6. Related party transactions
During the six month period Dr Clifford Gross, a Director, lent
GBP86,780 to the company. This is included in trade and other
payables at 31 May 2014 and has since been settled in full.
7. Business combinations
On 17 February 2014, the company entered into an acquisition
agreement with Dr Clifford Gross, pursuant to which the company
acquired the entire membership interest in Tekcapital LLC, which is
headquartered in the United States of America. The company paid
GBP1 as consideration for the acquisition as at the time of the
acquisition the company was not trading. On 31 March 2014 the
company entered into an operating agreement in relation to the
operation of Tekcapital LLC. The result, assets and liabilities of
Tekcapital LLC for the period ended 31 May 2014 are included in
this interim financial information.
After the period end, on 23 July 2014, Tekcapital LLC acquired
the rights to InventionEvaluator.com, for which the Group gave
consideration of 879,770 new shares in Tekcapital PLC. As our
financial impact considerations are not yet complete, the impact of
this transaction will be included in our full year results to 30
November 2014.
- Ends -
This information is provided by RNS
The company news service from the London Stock Exchange
END
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