28
September
2023
Acuity RM Group
plc
('ACRM' or the 'Company or
the
“Group”')
Interim Results to
30 June
2023
Acuity RM Group plc
(AIM:ACRM), which owns Acuity Risk Management Limited (“Acuity”),
today releases its interim results for the six months ended
30 June 2023 (“H1 2023” or the
“Period”).
During the Period the
Company acquired the balance of the issued and
to be issued share capital Acuity via a reverse takeover (the
“Acquisition”), therefore the results for H1 2023 comprise the
period to 23 April 2023, prior to the
Acquisition when the Company was constituted as an investing
company, and the period from 23 April to 30
June 2023, following the Acquisition of the outstanding
shares not already owned by the Company in Acuity, when the
consolidated results incorporate the trading performance of Acuity
for that
period.
H1 2023
Highlights
-
During the period the
Company transitioned from being an investing company to a trading
company, following the acquisition of the outstanding share capital
of Acuity not already by the Company, which was completed in
April
2023;
-
To reflect this the
Company changed its name from Drumz plc to Acuity RM Group
plc
Post Period end
highlights
-
Since the completion of
the Acquisition, Acuity has secured two new UK based contracts with
a combined value of over £450,000. In addition, since the
period end Kerry Chambers was
appointed as CEO of Acuity and as a main board Director of
ACRM.
Angus Forrest, Chief
Executive of ACRM commented on the
results: “The Acquisition is a major strategic move for ACRM,
having worked with Acuity for three years we understand the
business and its opportunities, Acuity’s Key Performance Indicators
(KPIs) are shown in my report. They demonstrate continuing
advances across all parts of the business and particularly the
sales and market opportunity which is expanding quickly with major
orders being
won.”
|
For further information
please contact: |
|
|
Acuity RM Group
plc |
www.acuityrmgroup.com |
|
Angus
Forrest |
+44 (0) 20 3582
0566 |
|
|
|
WH Ireland (NOMAD &
Broker) |
www.whirelandcb.com |
|
Mike Coe / Sarah
Mather |
+44 (0) 20 7220
1666 |
|
|
|
Peterhouse Capital Limited
(Joint broker) |
|
|
Lucy Williams / Duncan
Vasey |
+44 (0) 20 7469
0936 |
|
|
|
Clear Capital (Joint
broker) |
|
|
Andrew
Blaylock |
+44 (0) 20 3869
6080 |
Note to
Editors
Acuity RM Group
plc
Acuity RM Group plc (AIM: ACRM), is an established
provider of risk management services. Its award-winning STREAM®
software platform collects data about organisations to improve
business decisions and management. It is used by around 70
organisations in markets including government, utilities, defence,
broadcasting, manufacturing and
healthcare. The Company is focused on delivering long term,
sustainable growth in shareholder value. In the short to medium
term this is expected to come from the organic growth of Acuity and
thereafter may also come from complementary
acquisitions.
CHAIRMAN’S
STATEMENT
I am pleased to present
the Company’s interim results for the six months ended 30 June 2023. It has been a transformative period
for the Company, in which it has transitioned from being an
investing company to a trading company, following the acquisition
of the outstanding share capital of Acuity, not already owned by
the Company, which was completed in April
2023 (the “Acquisition”). In addition to reflect
this change, the Company changed its name from Drumz plc to Acuity
RM Group
plc.
Acuity is an established
provider of risk management services. Acuity’s award-winning
STREAM® is a GRC software platform, which collects data about
organisations to improve business decisions and management. It is
used by around 70 organisations in markets including government,
utilities, defence, broadcasting, manufacturing and healthcare.
Most customers use it for managing cybersecurity and IT risks and
for compliance with ISO 27001 and other standards and regulations.
STREAM® is sold on a SaaS or private cloud delivery (on-premise)
basis, typically with a three year licence, invoiced annually in
advance. Sales are made directly through the Company’s own sales
team and via a growing network of partners in the UK and the
US.
In conjunction with the
Acquisition, the Company raised £1.45 million (before expenses) by
issuing new ordinary shares in a placing and the Company’s name has
been changed to “Acuity RM Group plc” from “Drumz plc”. In
addition, the Company has created a new website, which I would
recommend to all shareholders, to
view:
www.acuityrmgroup.com
Results and
performance
The H1 2023 results
comprise the period to 23 April 2023,
when the Company was constituted as an investing company and the
period from 23 April to 30 June 2023,
following the Acquisition when the consolidated results incorporate
the trading performance of Acuity for that
period.
The Group’s principal
assets of the Group are our wholly owned subsidiary Acuity, the
award winning business specialising in risk management and
cybersecurity and the legacy holding in KCR Residential REIT plc
(“KCR”), a company listed on AIM, which owns property in the
private rented residential sector. The share price performance of
KCR continues to disappoint and these interim results include a
further downward adjustment to the fair value of this investment of
£73,000 (30 June 2022: loss of
£146,000) to reflect its prevailing market
price.
The Group’s results for
the Period showed consolidated revenue of £347,000 (H1 2022:
£30,000), reflecting the income earned by Acuity for the short
period it was fully owned by the Company. Taking into account
the increase in administrative costs occasioned by the Acquisition
of Acuity of £387,000, the Group incurred an operating loss of
£272,000 (30 June 2022: loss of
£115,000). After the loss on investments referred to above of
£73,000, the charge for amortisation and depreciation of £62,000,
the write off costs of the Acquisition, taken through the statement
of comprehensive income, £46,000 and the share option and other
costs of £27,000 the Company made a loss before taxation of
£384,000 (30 June 2022: loss of
£261,000).
The basic and fully
diluted loss per share amounted to 0.5p (30
June 2022: loss per share of 0.4p). No dividend has been
declared for the
period.
Principally as a result of
the Acquisition, the Company’s net assets have increased to
£5,463,000 (30 June 2022:
£1,374,000), As more fully set out in Note 7 to these financial
statements, these financial statements include the goodwill on
acquisition of £5,829,000 and the inclusion for the first time of
capitalised development costs of £353,000. Cash and cash
equivalents at 30 June 2023 amounted
to £493,000 (30 June 2022:
£413,000).
Board
On 9 March 2023 Nish Malde, a non-executive director
of the Company, resigned to focus on his other business
commitments. The Board would like to place on record its thanks to
Nish for his long standing commitment to the Company and to wish
him well for the
future.
As anticipated at the time
of the Acquisition, in June 2023,
Simon Marvell, who had been
appointed to the Board following the completion of the Acquisition
of Acuity, stood down as a director of the Company and was replaced
by Kerry Chambers who was appointed
a director of the Company and CEO of Acuity in July. I am pleased
to be able to report that that the Group will continue to benefit
from Simon’s good counsel, as he will continue to serve as
non-executive director of Acuity and be available to the Group as a
consultant.
Outlook
Over the past three years the Board has worked
closely with Acuity, particularly in relation to sales and
marketing activities and improving its key business indicators. I
am therefore delighted that the acquisition of Acuity has now been
completed, good progress has been made since completion of the
Acquisition with a number of new contracts secured and I look
forward to reporting further progress at Acuity under the
leadership of Kerry Chambers and her
team. I would also like to take this opportunity to thank my
colleagues on the Board, the Company’s advisers and its
shareholders for their continued
support.
Simon
Bennett
Chairman
28 September
2023
CHIEF EXECUTIVE’S
REPORT
H1 2023 has been one of significant change for the
Company. At beginning of the year, the Company was an investing
company with two principal investments: a 25% stake in Acuity and a
legacy shareholding in KCR Residential REIT, which will be realised
as and when an opportunity presents
itself.
In April 2023, the
Company completed the acquisition of the balance of the issued and
to be issued share capital in Acuity, which it did not already own,
for a total consideration of approximately £3.6 million, which was
satisfied by the issue of 45,709,570 new ordinary shares and the
payment of £0.5 million in cash. In order to fund the cash
consideration of the Acquisition, pay the deal costs and fund the
continued development of the Group, the Company raised £1.45
million (net of expenses) through a placing and subscription of
32,222,222 new ordinary
shares.
The rationale for the Acquisition of Acuity was based
on the increasing confidence of the Board in the progress being
made at the business, since the Company’s initial investment in
Acuity in September 2020. We have
worked closely with Acuity since then, the primary focus having
been on further improving the commercialisation of
Acuity.
In that regard, contract terms have been revised and
all sales of Acuity’s risk management software, STREAM®, have been
put on a SaaS or private cloud (on-premise) subscription basis.
Sales and marketing activities have been strengthened, with a new
digital marketing programme and the sales team has been
strengthened through recruitment. The benefits of these measures
are starting to be recognised and the Board believes Acuity is well
placed to exploit the opportunities presented to it in the large
and expanding global GRC (Governance, Risk, Compliance) market in
which it
operates.
Further information on Acuity and its business is set
out
below
Operating review of the
Period
The integration of Acuity into the Group has gone
smoothly. Since the completion of the Acquisition, Acuity has
secured two new UK based contracts with a combined value of over
£450,000 over three
years.
Part of Acuity’s strategy has been to focus on its
partners in 2023, in line with the most successful suppliers of GRC
software in the market place. This programme has been a
success, both in terms of the number of partners and, in addition,
when measured by the winning of more customers at higher values and
with a growing order
book.
The Acuity staff have reacted positively to the
change in ownership. Furthermore, management has been strengthened
post the period end with the appointment of both Adam Freeman as Chief Technical Officer and
Tom Miller as Chief Financial
Officer. I am pleased to be able to report that both have hit the
ground running and begun to have a positive impact on the
business.
All of the Acuity’s key performance Indicators
(“KPIs”) as at 31 March 2023 (being
Acuity’s historic financial year end) were trending positive as
shown in table
below:
|
|
31
March
2023 |
31 March
2022 |
31 March
2021 |
|
Annual revenues
£’000 |
1,754 |
1,558 |
1,226 |
|
Gross margin % |
89% |
92% |
92% |
|
Renewal rate |
96% |
82% |
81% |
|
Sales pipeline £’000 |
4,200 |
1,360 |
1,549 |
|
Net recurring revenue
% |
125.6% |
_ |
_ |
|
Monthly recurring
revenue£’000 |
139 |
112 |
88 |
As at 31 August monthly recurring revenue was c.
£150,000.
Overview of
Acuity
Acuity is an established provider of governance, risk
and compliance (“GRC”) risk management software and services via
its award-winning software platform STREAM®. STREAM® collects data
about organisations and provides functionality to improve business
decisions and management. It is in use in sectors including
government, utilities, defence, broadcasting, manufacturing and
healthcare. Most customers use STREAM® for GRC, managing
cybersecurity and IT risks and for compliance with ISO 27001 and
other standards and regulations, although it can be configured to
manage other risks such as vendor management to provide a
comprehensive view of risk and compliance across an
organisation.
STREAMÒ has several competitive strengths
including:
-
Speed of deployment – it can be deployed in four to
six weeks
-
Flexibility – STREAMÒ
can be used to manage a wide range of
risks
-
Configurability – which allows the user to set the
configuration themselves without the need for custom coding;
and
-
User experience and industry analysis -
STREAMÒ
has been developed over 15 years, is simple and
intuitive to use and is well reviewed by influential analysts,
including
Gartner.
The GRC market, in which Acuity operates in, includes
all organisations in the public, private and not for profit sectors
which have a requirement to manage their risks or comply with
regulations and standards. The drivers of the market are digital
transformation and organisations’ increasing awareness of their
internal requirement to optimise all aspects of their business and
external relations and regulation for better compliance and
governance.
Acuity operates in the enterprise GRC market which is
large, valued at $15bn in 2022 and
expanding, and forecast to grow to $27bn by 2027 (Source
marketsandmarketsä).
STREAM® is sold via subscription on a SaaS or private
cloud delivery (on-premise) basis (using a customer’s
infrastructure), typically on a three year licence, invoiced
annually in advance. The first year’s price will be higher as it
will usually include an element of consultancy for both
customisation and implementation of the system. Sales are made
directly through Acuity’s own sales team and via a growing network
of partners in the UK and the US. The software is usually delivered
from the cloud hosted by the SaaS business, often utilising an
international platform such as Amazon Web Services, Microsoft
Azure, Google Cloud or
similar.
Strategy
The future strategy of the Company following the
acquisition of Acuity is to develop its business to deliver long
term, sustainable growth in shareholder value. In the short to
medium term this is expected to come from organic growth and
thereafter may also come from complementary
acquisitions.
The Group will be focused on key business objectives
including:
-
accelerating revenue growth organically in both
existing and new global
markets;
-
further penetrating existing markets by forging
stronger customer and partner
relationships;
-
improving operational
efficiencies;
-
continuing to invest in developing STREAM® to enhance
its offering;
and
-
becoming a profitable and cash generative
group.
Summary
The focus is on building the value of Acuity, through
growth of the customer base, winning new orders which will produce
rising revenues. Recent contract wins and a strong pipeline
of opportunities are giving the Board increasing confidence that
the initiatives that have already been implemented are beginning to
deliver.
The Board is confident that further progress will be
made in the second half despite the general economic gloom and
looks forward to updating shareholders in due
course.
Angus
Forrest
Chief
Executive
Condensed consolidated
statement of comprehensive
income
|
|
Notes |
Unaudited six months to 30
June 23 |
Unaudited six months to 30
June 22 |
Audited 12 months to 31
Dec 22 |
|
|
|
Continuing
operations |
Acquisition24
Apr – 30 Jun |
Total |
Continuing
operations |
Continuing
operations |
|
|
|
£’000 |
£’000 |
£’000 |
£’000 |
£’000 |
|
Revenues |
|
20 |
327 |
347 |
18 |
60 |
|
Cost of
sales |
|
- |
(33) |
(33) |
- |
- |
|
Gross
profit |
|
20 |
294 |
314 |
18 |
60 |
|
|
|
|
|
|
|
|
|
Administration
costs |
|
(199) |
(387) |
(586) |
(133) |
(316) |
|
|
|
|
|
|
|
|
|
Operating
loss |
|
(179) |
(93) |
(272) |
(115) |
(256) |
|
Loss on
investments |
|
(73) |
|
(73) |
(146) |
(85) |
|
Amortisation of intangible
assets |
|
|
(60) |
(60) |
- |
- |
|
Depreciation |
|
|
(3) |
(3) |
- |
- |
|
Share option
provision |
|
25 |
|
25 |
|
|
|
Finance |
|
|
(1) |
(1) |
|
|
|
Loss before
tax |
|
(227) |
(157) |
(384) |
(261) |
(341) |
|
Tax |
|
- |
- |
- |
|
|
|
|
|
|
|
|
|
|
|
Loss for
period |
|
(227) |
(157) |
(384) |
(261) |
(341) |
|
|
|
|
|
|
|
|
|
Earnings per
share |
(4) |
(0.3) |
(0.2) |
(0.5) |
(0.4) |
(0.8) |
|
Basic EPS from continuing
operations |
(4) |
(0.3) |
|
|
|
|
|
Basic EPS from loss for
the period |
(4) |
|
(0.2) |
(0.5) |
(0.4) |
(0.8) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share is taken as equal to basic
earnings per share as the Company is loss making and the average
share price during the period is lower than the exercise price and
therefore the effect of including share options is
anti-dilutive.
Condensed consolidated
statement of financial
position
|
|
Unaudited as at 30 June
2023 |
Unaudited as at 30 June
2022 |
Audited as at 31 Dec
2022 |
|
|
Note |
£’000 |
£’000 |
£’000 |
| ASSETS |
|
|
|
|
| Non-current
assets |
|
|
|
|
| Investments at fair value through profit or
loss |
9 |
232 |
942 |
930 |
| Tangible assets |
|
10 |
|
|
| Intangible assets |
7 |
6,204 |
|
|
|
|
|
6,446 |
942 |
930 |
| Current
assets |
|
|
|
|
| Trade and other
receivables |
|
678 |
34 |
122 |
|
Cash and cash
equivalents |
|
493 |
413 |
222 |
|
|
|
1,171 |
447 |
344 |
|
Total
assets |
|
7,617 |
1,389 |
1,274 |
| LIABILITIES |
|
|
|
|
| Current
liabilities |
|
|
|
|
|
Trade and other
payables |
|
568 |
15 |
47 |
|
Deferred income |
|
1,406 |
|
|
|
Total
liabilities |
|
1,974 |
15 |
47 |
|
Net
assets |
|
5,643 |
1,374 |
1,227 |
| EQUITY |
|
|
|
|
| Share
capital |
8 |
2,767 |
2,688 |
2,688 |
| Share premium
account |
|
12,269 |
8,385 |
8,385 |
| Share option reserve |
|
67 |
41 |
51 |
| Convertible
loan |
|
- |
- |
- |
| Merger
reserve |
|
1,833 |
1,012 |
1,012 |
|
Retained
earnings |
|
(11,293) |
(10,752) |
(10,909) |
|
Total equity attributable to shareholders of the
company |
|
5,643 |
1,374 |
1,227 |
Condensed consolidated
statement of changes in
equity
|
|
|
Share |
Share |
|
|
|
|
|
Share |
premium |
option |
Merger |
Retained |
Total |
|
|
capital |
account |
Reserve |
reserve |
earnings |
equity |
|
|
£’000 |
£’000 |
£’000 |
£’000 |
£’000 |
£’000 |
|
Balance at 1 January
2022 |
2,688 |
8,385 |
30 |
1,012 |
(10,568) |
1,547 |
|
Total comprehensive
profit |
— |
— |
__ |
— |
|
|
|
Share option reserve |
__ |
__ |
|
__ |
_ |
|
|
Balance at 30 June
2022 |
2,688 |
8,385 |
30 |
1,012 |
(10,568) |
1,547 |
|
Total comprehensive
loss |
— |
— |
__— |
— |
(341) |
(341) |
|
Share option reserve |
__ |
__ |
21 |
__ |
|
21 |
|
Balance at 31 December
2022 |
2,688 |
8,385 |
51 |
1,012 |
(10,909) |
1,227 |
|
Total comprehensive
loss |
— |
— |
— |
— |
(384) |
(384) |
|
Issue of shares net of
costs |
79 |
3,884 |
|
|
|
3,963 |
|
Fair value
adjustment |
- |
- |
- |
821 |
|
821 |
|
Share option reserve |
__ |
__ |
16 |
__ |
__ |
16 |
|
Balance at 30 June
2023 |
2,767 |
12,269 |
67 |
1,833 |
(11,293) |
5,643 |
Condensed consolidated
statement of cash
flows
|
Unaudited 6 months to 30 June
2023 |
Unaudited 6 months to 30 June
2022 |
Audited year to 31 December
2022 |
|
|
£’000 |
£’000 |
£’000 |
|
Cash flows from operating
activities |
|
|
|
|
(Loss)/profit before
taxation |
(384) |
(184) |
(341) |
|
Adjustments
for: |
|
|
|
|
Fair value adjustment for listed
investments |
73 |
73 |
85 |
|
Depreciation and
amortisation |
63 |
|
|
|
Share option reserve |
(25) |
11 |
21 |
|
Changes in working
capital: |
|
|
|
|
- (Increase)/decrease in trade and other
receivables |
(544) |
(11) |
(99) |
|
- (Decrease)/increase in trade and other
payables |
2,059 |
(37) |
(5) |
|
Subsidiary working capital movement on
acquisition |
(1,849) |
|
|
|
Net cash used in operating
activities |
(607) |
(148) |
(339) |
|
Cash flows from investing
activitiesPurchase of
investmentsCash flows from financing
activitiesCash raised through issue of shares (net of
transaction costs) |
878 |
|
|
|
Cash received from financing
activities |
878 |
|
|
|
Net increase / (decrease) in cash and cash
equivalents |
271 |
(148) |
(339) |
|
Cash and cash equivalents at beginning of
period |
222 |
561 |
561 |
|
Cash and cash equivalents at end of
period |
493 |
413 |
222 |
1. Nature of operations and general
information
The principal
activity of the Company is investing in and managing technology
companies, which offer value creation opportunities over the short
and medium term. In the period the Company acquired Acuity Risk
Management Ltd on 24 April 2023 from
which date it has been classified as a trading business and is
actively participating in the management of Acuity Risk Management
Ltd.
Acuity RM Group plc is incorporated and domiciled in
the United Kingdom. The address of
the registered office is 2nd Floor 80 Cheapside,
London, EC2V
6EE.
The Company’s shares are listed on AIM, a market
operated by the London Stock Exchange. The condensed consolidated
interim financial report was approved for issue by the Board of
Directors on [27] September
2023.
The financial information set out in this interim
financial report does not constitute statutory accounts as defined
in Sections 434(3) and 435(3) of the Companies Act 2006. The
Company’s statutory financial statements for the year ended
31 December 2022 have been filed with
the Registrar of Companies and are available
at www.acuityrmgroup.com.
The auditor’s report on those financial statements was unqualified
and did not contain any statement under Section 498(2) or Section
498(3) of the Companies Act
2006.
2. Basis of
preparation
The condensed consolidated
interim financial report has been prepared in accordance with the
requirements of the AIM Rules for Companies. As permitted, the
Company has chosen not to adopt IAS 34 “Interim Financial
Statements” in preparing this interim financial information. The
condensed consolidated interim financial statements should be read
in conjunction with the annual financial statements for the year
ended 31 December 2022. The interim
financial statements have been prepared in accordance with
International Financial Reporting Standards (IFRSs) as adopted by
the United Kingdom which have not
differed from the previously EU-endorsed IFRS, and hence the
previously reported accounting policies still
apply.
Going
concern
The Directors, having made
appropriate enquiries, consider that adequate resources exist for
the Company and Group to continue in operational existence for the
foreseeable future and that, therefore, it is appropriate to adopt
the going concern basis in preparing the condensed
consolidated interim
financial statements for the period ended 30
June
2023.
Risks and
uncertainties
The Board continuously
assesses and monitors the key risks of the business. The key risks
that could affect the Group’s medium-term performance and the
factors that mitigate those risks have not substantially changed
from those set out in the Company’s 2022 Annual Report and
Financial Statements, a copy of which is available on the Company’s
website: www.acuityrmgroup.com.
Critical accounting
estimates
The preparation of
condensed consolidated interim
financial report requires management to make estimates and
assumptions that affect the reported amounts of assets and
liabilities at the end of the reporting period. Significant items
subject to such estimates are set out in the Company’s 2022 Annual
Report and Financial Statements. The nature and amounts of such
estimates have not changed significantly during the interim
period.
3. Accounting
policies
Except as described below,
the same accounting policies, presentation and methods of
computation have been followed in these condensed consolidated
interim financial statements as were applied in the preparation of
the Group’s annual financial statements for the year ended
31 December
2022.
3.1 Changes in accounting
policy and
disclosures
(a) Accounting
developments during
2023
The International
Accounting Standards Board (IASB) issued various amendments and
revisions to International Financial Reporting Standards and IFRIC
interpretations. The amendments and revisions were applicable for
the period ended 30 June 2023 but did
not result in any material changes to the financial statements of
the Group or
Company.
|
Standard |
Impact on initial
application |
Effective
date |
|
IAS
8 |
Accounting
estimates |
1 January
2023 |
|
IAS
1 |
Classification of
Liabilities as Current or Non-Current. |
1 January
2023 |
|
IAS
1 |
Disclosure of Accounting
Policies |
1 January
2023 |
(b)
New standards, amendments
and interpretations in issue but not yet effective or not yet
endorsed and not early
adopted
The Group is evaluating
the impact of the new and amended standards above which are not
expected to have a material impact on the Group’s results or
shareholders’
funds.
4. Loss per ordinary
share
The loss per ordinary share is based on the weighted
average number of ordinary shares in issue during the period of
70,042,357 ordinary shares of 0.1p (2022: 41,982,205 ordinary
shares of 0.1p adjusted for share reorganisation 24 April 2023) and the following
figures:
|
Unaudited 6 months to 30
June 2023 |
Unaudited 6 months to 30
June 2022 |
Audited year to 31
December 2022 |
|
Loss attributable to equity
shareholders £’000 |
(384) |
(184) |
(341) |
|
Loss per ordinary
share |
(0.5)p |
(0.4)p |
(0.8)p |
There was a 1 for 2,000 consolidation followed by a
200 for 1 subdivision of the ordinary shares of 0.1p on
24 April 2023. Following that
exercise, each new ordinary share is worth approximately 10 old
shares. All share numbers and loss per share set out above
have been adjusted to reflect the change, in that they are
calculated using the new consolidated ordinary
shares
Diluted loss per share is taken as equal to basic
earnings per share as the Company’s average share price during the
period is lower than the exercise price and therefore the effect of
including share options is
anti-dilutive.
5. Segmental
analysis
There Company now manages its wholly owned subsidiary
a software company, Acuity Risk Management Limited and may acquire
other technology
businesses.
Six months to 30 June
2023
|
|
Acuity Risk Management
Ltd |
Acuity RM Group
plc |
Total |
|
|
£’000 |
£’000 |
£’000 |
|
Revenue |
327 |
20 |
347 |
|
Cost of
sales |
(33) |
|
(33) |
|
Admin
costs |
(387) |
(199) |
(586) |
|
Operating
Loss |
(93) |
(179) |
(272) |
|
Amortisation and
depreciation |
(63) |
|
(63) |
|
Finance |
(1) |
|
(1) |
|
Loss on
investment |
|
(73) |
(73) |
|
Share option
charge |
|
25 |
25 |
|
Tax |
|
|
|
|
|
|
|
|
|
Loss of
period |
(157) |
(227) |
(384) |
All activities are based mainly in the United Kingdom.
6. Business
combinations
On 24 April 2023 the
Group acquired the ordinary shares in Acuity Risk Management
Limited which it did not own, valuing Acuity Risk Management Ltd at
£5 million. The consideration for the shares acquired was
£3,585,396. This investment is included in the parent
company’s Statement of Financial Position at its fair value at the
date of
acquisition.
The completion accounts show a breakdown of the
assets and liabilities of the acquired company to be as
follows:
|
|
Book
value |
Fair value
adjustment |
Fair value to
Group |
|
|
£’000 |
£’000 |
£’000 |
|
Investments |
|
|
|
|
Intangible fixed
assets |
1,493 |
4,711 |
6,204 |
|
Tangible fixed
assets |
10 |
|
10 |
|
Receivables |
385 |
|
385 |
|
Cash and Bank |
163 |
|
163 |
|
Payables |
(363) |
|
(363) |
|
Deferred
revenues |
(1,399) |
|
(1,399) |
|
Deferred tax |
|
|
|
|
Net assets on
acquisition |
289 |
4,711 |
5,000 |
|
Goodwill on
acquisition |
|
|
(1,415) |
|
Total
consideration |
|
|
3,585 |
|
|
|
|
|
|
|
|
|
|
|
Discharged
by: |
|
|
|
|
Shares in Acuity RM Group
plc |
|
|
3,085 |
|
Cash payment |
|
|
500 |
|
Total |
|
|
3,585 |
The revenue and loss included in the Consolidated
Statement of Comprehensive Income for the nine weeks to 30 June was
£327,000 and (£157,000) Pre-tax
respectively
7. Intangible
assets
|
|
Other Intangible
Assets |
Goodwill acquired on
acquisition |
Development
costs |
Total |
|
|
£’000 |
£’000 |
£’000 |
£’000 |
|
Cost |
|
|
|
|
|
1 January
2023 |
- |
- |
- |
- |
|
|
|
|
|
|
|
Additions |
22 |
5,829 |
353 |
6,204 |
|
At 30 June
2023 |
22 |
5,829 |
353 |
6,204 |
|
|
|
|
|
|
|
Amortisation |
|
|
|
|
|
At 1 January
2023 |
- |
- |
- |
- |
|
Charge in
period |
|
- |
|
|
|
At 30 June
2023 |
|
- |
|
|
|
|
|
|
|
|
|
Net book
value |
|
|
|
|
|
30 June 2023 |
22 |
5,829 |
353 |
6,204 |
|
|
|
|
|
|
|
31 December
2022 |
- |
- |
- |
- |
8. Share
capital
As at 30 June 2023 the
Company’s share capital was as
follows:
|
Allotted, issued and fully
paid |
No. |
Value
£ |
|
|
|
|
|
Ordinary shares of 0.1p
each |
121,025,303 |
121,025 |
|
Deferred shares of 0.1p
each |
2,645,954,765 |
2,645,955 |
|
|
|
|
|
Total |
|
2,766,980 |
As at 31 December 2022 41,982,205
(adjusted for reorganisation approved 24
April
2023)
There was a consolidation and subdivision of the
ordinary shares of 0.1p on 24 April
2023. Following that exercise, the number of shares
was reduced on the basis of 1 for
10.
9.
Investment
The Company made investments as follows during the
years ended 31
December:
2018 it acquired 2,435,710 shares in KCR Residential
REIT PLC, an AIM listed real estate investment trust specialising
in the acquisition and management of rented residential portfolios
in the UK.
The cost was
£1,705,000.
In accordance with IFRS 7, financial instruments are
measured by level of the following fair value measurement
hierarchy:
Level 1: quoted prices in an active market for
identical assets or liabilities. The fair value of financial
instruments traded in active markets is based on quoted market
prices at the balance sheet date. A market is regarded as active if
quoted prices are readily and regularly available and those prices
represent actual and regularly occurring market transactions on an
arm’s-length basis. The quoted market price used for financial
assets held by the Group is the closing price on the last day of
the financial year of the Group. These instruments are included in
level 1 and comprise FTSE and AIM-listed investments classified as
held at fair value through profit or
loss.
Fair value at 30 June
2023 was £232,000 (31 December
2022 £305,000) and at 30 June
2022:
£317,000).
It is the directors’ intention to realise this
investment when there is an appropriate
opportunity.
In the period the Company acquired 100% of the issued
share capital of Acuity Risk Management Ltd, a company in which it
had previously owned a 25% shareholding and in previous periods had
been accounted for as an
investment.