TIDMCABP
RNS Number : 2322M
CAB Payments Holdings PLC
13 September 2023
13 September 2023
CAB Payments Holdings plc
("CAB Payments" or the "Group" or the "Company")
Results for the Six Months Ended 30 June 2023
CAB Payments, a market leader in business-to-business
cross-border payments and foreign exchange, specialising in
hard-to-reach markets, announces the Company's results for the six
months ended 30 June 2023.
Bhairav Trivedi, Chief Executive Officer of CAB Payments,
commented:
"CAB Payments made strong progress in the first half of 2023,
reflected in another set of record results and significant growth
in revenue and profit. We are making strong progress against our
strategic objectives, with a significant expansion of our global
network, the signing of some important new clients and an ongoing
shift to our digital channel, EMPower Payments Gateway. This bodes
very well for the future."
Financial and Operating Summary:
-- Total income up by 94% at GBP71.8 million vs H1 '22
-- Encouraging revenue growth in all four client segments
-- Adjusted EBITDA(1) GBP39.9 million (H1 '22: GBP14.3 million)
-- Adjusted EBITDA margin(2) 56% (H1 '22: 39%)
-- Strong operational and sales performance during the period
-- Significant new client wins, underpinning future revenue
growth
-- Strong growth in proprietary network of nostro accounts and
global liquidity providers
-- EMPower Payments Gateway transactions increased from 9k to 41k, now serving 72 countries
Bhairav Trivedi, Chief Executive Officer of CAB Payments,
further commented:
"We successfully completed our IPO on the London Stock Exchange,
underscoring the confidence the market sees in the high-quality
offering we provide to customers, as well as our strong financial
profile. As we move into the second half of the year, the business
has a number of initiatives in progress which should both provide
support in the short-term and deliver long-term growth. The
industry dynamics continue to be supportive to specialist providers
like CAB Payments and our unique proposition and set of strengths
positions the Company well to capitalise on the opportunity ahead
and deliver increasing shareholder returns into the future."
Selected Financial Information from Six months ended YoY
Continuing Operations (GBPm) 30 June
2023 2022 %
Total Income 71.8 37.0 94%
Adjusted EBITDA(1) 39.9 14.3 180%
Profit before Tax 23.8 11.2 112%
Profit after Tax 14.8 9.0 65%
Earnings Per Share (pence) 6.1 3.7 65%
====================================== ========= ======== =====
Total Income by Product Type from Six months ended YoY
Continuing Operations (GBPm) 30 June
2023 2022 %
FX 37.9 20.3 87%
Payments 17.1 13.2 30%
========= ======== =====
Total Transactional Revenue 55.1 33.5 64%
Other banking services 16.8 3.6 371%
Total Income 71.8 37.0 94%
====================================== ========= ======== =====
(1) Adjusted EBITDA is defined as profit from continuing
operations, before tax, depreciation, amortisation and
non-recurring operating expenses.
(2) Adjusted EBITDA margin is defined as Adjusted EBITDA divided
by Total Income.
Note: Rounding - Certain data in this document has been rounded.
As a result of the rounding, the totals of data presented in this
document may vary slightly from the actual arithmetic totals of
such data.
Analyst and Institutional Investor webcast
A presentation webcast and live Q&A conference call for
analysts and institutional investors will take place on September
13(th) 2023 at 9.30 am UK Time, and a webcast of the presentation
will be made available on the Company's website at
https://www.cabpayments.com/investors .
To register for this event, please go to:
https://www.lsegissuerservices.com/spark/CABPAYMENTSHOLDINGS/events/4bf580d6-59d6-4569-9585-249a2b0d1a59
For further information, please contact:
CAB Payments Holdings plc
Michael Goldfarb and Kieran McKinney, Investor
Relations
investorrelations@cabpayments.com
www.cabpayments.com
J.P. Morgan Cazenove
(Corporate Broker to CAB Payments) Tel: +44 207 742 4000
Alia Malik
James Summer
FTI Consulting
(Public Relations Adviser to CAB Payments) Tel:
Ed Bridges - Edward.Bridges@fticonsulting.com +44 (0) 7768 216 607
Neil Doyle - Neil.Doyle@fticonsulting.com +44 (0) 7771 978 220
Erica Lewis - Erica.Lewis@fticonsulting.com +44 (0) 7971 361 970
Zita Setiawan - Zita.Setiawan@fticonsulting.com +44 (0) 7974 033 078
Chair's Introduction
With our first set of results as a listed business, I wanted to
introduce myself as Chair of CAB Payments and provide some context
to the journey ahead.
I recognise the importance of great governance and oversight in
any business and particularly in a company which has recently been
brought to the public markets with such exciting ambitions and
prospects. I am delighted to have been asked to lead such a
talented Board of Directors and I am also pleased that the Board is
comprised of such a diverse range of individuals, from a cultural,
commercial and experience background. This will be essential as we
seek to provide guidance for a global business, such as CAB
Payments.
CAB Payments is a leader in a sizeable niche. Being able to
safely, rapidly and cost-effectively move funds around the world
within the confines of a complex regulatory environment can be a
daunting task, and it is one best left to the experts. It is also a
market which is growing rapidly and coming under additional
scrutiny in a shifting geo-political environment. This provides a
great opportunity and comes with great responsibility; it is here
that CAB payments stands out. Compliance is a watchword for the
Company and the maintenance of our UK banking licence ensures we
meet the highest standards and this raises us above the
competition.
Our people are key to our success and I believe we have great
people. Their efforts recently in bringing about the successful
market Listing, while not losing sight of the day job or impacting
our service to clients were exceptional. Simultaneously, we have
been building a business fit for the future; this is testament to
the quality of our people.
Our growth plans have been well communicated and understood. We
believe that successful strategic and operational delivery will
result in superior shareholder returns. In the short term our
priority is to invest in the business where we see the best
opportunities, in new clients, segments and markets. We are
pursuing a growth agenda; our market is expected to grow rapidly,
and our business is intent on gaining share. This will require
reinvestment and should provide growth in revenue, profits and cash
generation as a reward. The Board will keep the capital allocation
under review and will always seek to make the right choice to
maximise long-term and sustainable shareholder value.
I very much look forward to addressing you again at the time of
the 2023 Full Year financial results in 2024.
Ann Cairns
Chair
12 September 2023
Chief Executive Officer review
Strategic context
CAB Payments is a market leader in business-to-business
cross-border payments and foreign exchange, specialising in
hard-to-reach markets. The Group is a significant and growing
operator in a large and expanding market. Success is dependent on
continued focus on what we do best, offering an unrivalled and
cost-efficient service to financial and commercial institutions and
governmental bodies. The Group has excelled due to the strength of
its payments network and global relationships, both partners and
clients.
CAB Payments has a number of significant growth drivers
underpinning its long-term development:
-- Large, fast-growing addressable market
-- Ongoing transition to specialist providers
-- Blue chip client base
-- Global network and infrastructure
-- Market-leading proposition
-- Positive global impact
Our current Total Addressable Market is increasing by
approximately 20% per year, from an estimated $2.3 trillion of
financial flows in 2022. In addition, CAB Payments, supported by a
global strategy consulting firm, estimates that traditional banks
represented 85% of total revenue within our addressable market in
2022; this is forecast to decline to less than 60% by 2027, as
specialists like CAB Payments replace legacy bank bilateral
networks.
The consistent investment in our technology platform and our
growing network of banking relationships positions mean we are well
positioned to continue to gain market share and outperform
competitors in our rapidly growing market.
Business Performance
In the period, the Group continued to build on its track record
of strong profitable growth, increasing adjusted EBITDA margins and
profit after tax.
Revenue growth in the business and in Payments and FX
For the six months ended 30 June 2023, total income (1) was
GBP71.8 million, an increase of 94% from GBP37.0 million for the
same period in the prior year. Significant growth was seen across
the business, with our strategic business lines (FX and Payments)
together increasing to GBP55.1 million from GBP33.5 million for the
same period in prior year, an increase of 64%.
Our core payments and FX business, outside of the Nigerian
corridor, grew from GBP20.4 million in H1 '22 to GBP33.1 million
for H1 '23, a growth rate of 62%. Activity here normalised through
what was a quieter second quarter for the Company, with some
temporary headwinds, which are now abating. The normalisation in
Naira activity in the second quarter was offset by an increase in
net interest income (NII), delivering GBP15.8 million in the half
year period, up from GBP2.2 million in the prior year. We separate
out these elements in the Financial Review below to provide a
clearer understanding of the underlying business.
Income seasonality exists in the business, driven by client
demand. March and September see central bank debt repayments from
Africa to China and the Middle East. December is the peak month for
aid flows, as annual budgets are cleared, and the fourth quarter
("Q4") is the high point for remittance as Diwali and Christmas
drive spikes in demand. Although it is impossible to be precise due
to the rapid growth in revenue, we generally assume the business
achieves around 40% of annual revenue in H1 and 60% in H2.
EBITDA expansion and margin improvement
Adjusted EBITDA (2) increased to GBP39.9 million for the six
months ended 30 June 2023, from GBP14.3 million in H1 '22, with
adjusted EBITDA margin (3) increasing from 39% to 56%, reflecting
our topline growth, the operating leverage inherent in our business
and well managed costs. Reported profit after tax from continuing
operations in the period increased to GBP14.8 million from GBP9.0
million in the same period in the prior year.
Our investment plans remain unchanged. In the period we invested
in our business across products, people and network, which is
reflected in our recurring operating costs (4) for the period of
GBP32.1 million (H1 '22: GBP22.6m) and intangibles capex of GBP2.0
million (H1 '22: GBP2.0m). In H2 '23, we expect to accelerate our
investment as we seek to expand our international footprint,
including sales offices in the US and Europe, a sales and trading
office in Asia and eventually deeper licensing and dollar clearing
in the US.
Ongoing client sales and momentum with existing clients
The strength of our value proposition and our global reach
continue to be validated by the retention of existing clients and
the number of new blue-chip clients around the world beginning to
use our products and services. In the first six months of this
year, we onboarded 44 new clients and signed several others that
are progressing through the systematic onboarding process.
Highlights from this period include:
-- Significant new clients in several regions, including Santander Group/PagoNxt
-- Signing client agreements with the three largest exchange
houses in the United Arab Emirates
-- Strengthened our position as the go-to-provider to the
development sector, signing major new International Development
Organisation ("IDO") clients
-- All four client segments grew from H1 '22 to H1' 23; non-bank
financial institutions by 67%, emerging market financial
institutions by 29%, IDO's by 91% and Major Market Banks by 73%.
These figures are all excluding Nigerian Naira and are higher if
Naira is included
(1) Total Income when referring to the Group's financial results
means "total income, net of interest expense" as reported in the
interim condensed consolidated statement of profit or loss and
other comprehensive income.
(2) Adjusted EBITDA is defined as profit from continuing
operations, before tax, depreciation, amortisation and
non-recurring operating expenses - see note 3 to the interim
condensed consolidated financial statements.
(3) Adjusted EBITDA margin is defined as Adjusted EBITDA divided
by Total Income
(4) Recurring operating costs excluding depreciation and
amortisation
Network growth in breadth and depth
The Group's network continues to grow to meet expanding client
demand, ensuring our ability to provide fast, competitively priced,
and reliable transactions across our target markets, and extending
our overall addressable market.
The Group grew its proprietary network of global Nostro accounts
to 152, with a total of 180 partners through which the Group is
able to execute transactions. The Group also expanded its pool of
global liquidity providers, reaching a total of 291 liquidity
providers around the world. Notably, our network expansion
accelerated in geographic areas outside of our historical target
markets, including Eastern Europe, Central Asia and Pacific
islands. Our network is underpinned by our UK banking licence and,
with it, bank-grade anti-money laundering ("AML") policies; these
provide great assurance to our clients and partners and help
differentiate CAB Payments from the competition.
Further growth in key products
The Group's core foreign exchange and cross-currency payments
business lines continued to grow rapidly, reflecting ongoing
product investment and the focus on serving customer needs. The
Group's differentiated access to emerging market liquidity is at
the centre of core transaction flows.
The Group continued to invest to support internal and external
software development efforts, resulting in further product
functionality improvements. In payments, we increased the number of
cross-currency transactions executed through our Payments Gateway,
EMPower, from 9k in H1 '22 to 41k in H1 '23. As at the end of H1
'23, EMPower Payments Gateway processes transactions for 72
countries. From an FX perspective, we continued to increase the
proportion of trades executed through digital channels, reaching
just over 92% in H1 '23, up from 87% in H1 '22. This enhances
client experience and increases the operational and cost-efficiency
of our trading operations. The number of currency pairs we are able
to offer increased by 100 to over 600 at the period end.
Solidifying CAB Payments - global footprint
The Group has begun the process of developing a corporate
presence outside of our traditional UK headquarters, enabling us to
be closer to our current and future clients and partners. Both
Europe and the US are significant new opportunities for us.
In Europe, following the exit of the UK from the European Union
("Brexit"), the Group has faced limitations on its ability to
proactively conduct outreach activities to clients. On 25 November
2022, we applied to the De Nederlandsche Bank ("DNB"), the lead
prudential bank regulator in the Netherlands, for a payment
institution licence. We hired a board of directors and an office
head to help guide us through the process and oversee the business
once we are operational.
In the US, the Group is preparing to submit applications to the
Federal Reserve Bank in New York and the New York State Department
of Financial Services, for permission to open a representative
office. The New York office will serve as a hub for our engagement
with clients in the Americas. We have now recruited a General
Manager for the New York office, with the relevant experience to
guide this process and develop the business in the future.
Scaling our diverse, growing team supporting business
performance
We are actively increasing our staff numbers and expertise, with
careful consideration of our diversity goals, in line with our
plans for scaling the business and the opportunities we see for
growth. We have increased our capabilities and employee numbers
across all our functions, with a particular focus on sales,
technology and compliance. The number of full-time equivalent staff
employed within the Group, was 344 at 30 June 2023, up from 225 at
30 June 2022. We are also delighted with the range of skills and
experience within our plc Board of Directors, which is 60%
comprised of female members vs the FTSE 350 average of 40%. The
investment in our people is aligned with our investment in the
technology and sales infrastructure and we now have the right
engine for growth across the business.
Outlook for 2023
While it is still early in the second half, trading during the
third quarter has improved and is returning to more normal levels,
and September and the end of the fourth quarter are traditionally
the busiest periods for the business. These trends, along with a
number of initiatives already in progress, provide confidence both
in the short-term outlook and the prospects for medium-term growth.
The industry dynamics continue to be supportive to specialist
providers like CAB Payments and our unique proposition and set of
strengths positions the Company well to deliver increasing
shareholder returns into the future.
Bhairav Trivedi
Chief Executive Officer
12 September 2023
Financial Review
Total Income (5)
Total Income by Product Type from Continuing Six months ended YoY
Operations (GBPm) 30 June
2023 2022 %
FX 37.9 20.3 87%
Payments 17.1 13.2 30%
========= ======== =====
Total Transactional Revenue 55.1 33.5 64%
Other banking services 16.8 3.6 371%
========= ======== =====
Total Income 71.8 37.0 94%
============================================== ========= ======== =====
(5) Rounding - Certain data in this document has been rounded.
As a result of the rounding, the totals of data presented in this
document may vary slightly from the actual arithmetic totals of
such data.
Overall
The total income for the six months ended 30 June 2023 was
GBP71.8 million; of this GBP41.3 million in the first quarter and
GBP30.5 million in the second quarter. We typically record higher
revenues in the second half of each year due to client demand
spikes in September from debt repayments, December from annual aid
flows and Q4 from gift giving holidays. Although it is impossible
to be precise due to the rapid growth in revenue, we generally
assume the business achieves around 40% of annual revenue in H1 and
60% in H2. In 2022, total income was GBP109 million, of which GBP37
million (34%) was delivered in the first half of the year and GBP72
million (66%) in the second half.
Transactional revenue: Payments and FX
Further Analysis of Transactional Revenue Six months ended YoY
(GBPm) 30 June
2023 2022 %
FX and Cross Currency excl. Naira ("NGN") 33.1 20.4 62%
FX and cross-currency: NGN 15.2 6.0 155%
Ancillary Payments: Same Currency / Pension
/ Platform 6.7 7.1 (1)%
========= ======== =====
Total Transactional Revenue 55.1 33.5 64%
============================================= ========= ======== =====
FX and cross currency payments, excluding Nigeria business, grew
by 62% year on year to GBP33.1 million (H1 '22: GBP20.4 million).
This is consistent with long-term core growth and guidance and
historic seasonality. The business typically sees a stronger Q1
than Q2, driven by central bank regular debt repayments at the end
of March.
Foreign exchange into Nigeria delivered revenue of GBP15.2
million (H1 '22: GBP6.0 million) and is reported in the FX and
Payments business lines. NGN income reduced from GBP11.1 million in
Q1 to GBP4.1 million in Q2. By the end of the second quarter, NGN
activity had normalised in line with levels pre-2022 but is
expected to continue to be one of our larger revenue corridors.
Ancillary payments revenue streams, such as same currency,
pension and platform payments were broadly in line with the same
period in the prior year at GBP6.7 million (H1 '22: GBP7.1
million).
Other Banking Services
Other Banking Services is primarily net interest income (NII),
as well as trade finance and liquidity services. Other Banking
Services revenue for the six months ended 30 June 2023 was GBP16.8
million, up from GBP3.6 million for the prior period. This increase
was driven by an increase in NII, which was GBP15.8 million for the
period compared to GBP2.2 million for the prior period (6) ,
reflecting the impact of Federal Reserve and Bank of England
interest rate rises. This revenue line is expected to continue to
reflect movements in these rates.
(6) See note 3 to the interim condensed consolidated financial
statements. NII reported internally under Other Banking Services
relates to returns from short-term investments in the money
market.
Profit and loss
Continuing Operations Income Six months ended YoY
Statement (GBPm) 30 June
2023 2022 %
Total Income 71.8 37.0 94%
Clearing costs (0.9) (1.0) (4%)
Staff related costs (21.3) (14.7) 45%
Recurring other operating expenses (9.7) (7.1) 37%
========= ========= =======
Adjusted EBITDA 39.9 14.3 180%
Adjusted EBITDA margin % 56% 39% 17ppts
Depreciation and amortisation (3.0) (3.1) (2%)
Non-recurring operating expenses (13.1) - n.m.
Profit before Tax 23.8 11.2 112%
Tax (9.0) (2.2)
Profit after Tax 14.8 9.0 65%
==================================== ========= ========= =======
Staff related costs increased to GBP21.3 million in the first
half of 2023 compared to GBP14.7 million in H1'22 as a result of
higher average number of employees (H1 '23: 313 FTE's, H1 '22: 212
FTE's), as the business continues to invest for sustainable revenue
growth, the impact of annual performance and inflationary staff
increases and an increase in variable pay, which is accrued for
based on a percentage of salaries.
The revenue growth and the operating leverage of the business
model drove adjusted EBITDA up by 180% to GBP39.9 million (H1 '22:
GBP14.3 million) and adjusted EBITDA margin up by 17 percentage
points to 56% (H1 '22: 39%).
Non-recurring items in 2023 primarily reflect the professional
fees incurred as a result of the listing process undertaken in the
first half of the year, as well as non-performance staff bonuses
relating to recruitment commitments on listing.
Profit Before Tax was up by 112% at GBP23.8 million (H1 '22:
GBP11.2 million).
Taxation
The tax charge arising during the period of GBP9.0 million (H1
'22: GBP2.2 million) indicates an effective tax rate of 38%, which
reflects adjustments for disallowable costs associated with the
listing. The tax rate takes account of the corporation tax rate and
banking surcharge. The effective tax rate for the current year is
expected to be between 31% and 33%.
Investments
Capital Expenditure for the six months ended 30 June 2023 was
GBP2.2 million (H1 '22: GBP2.1 million), of which GBP2.0 million
(H1 '22: GBP2.0 million) related to capitalised software. We
continue to estimate that capital investments for the 2023 year
will be c.8% of total income, based on projects in progress and in
the pipeline.
Balance Sheet and Cashflow
The balance sheet largely comprises interest-bearing current and
term customer deposits to support payment flows, which the Group
holds in high quality liquid assets in order to meet liquidity
requirements. The reported consolidated statement of cash flows
therefore largely reflects the movement in customer deposits, and
movements in to and out of asset classes not classified as cash and
cash equivalents.
Customer account balances as at 30 June 23 were GBP1,246
million, compared to GBP1,306 million at 31 December 2022. The
customer accounts represent demand deposit accounts of corporate
and other institutional customers held with Crown Agents Bank. A
substantial proportion of customer accounts are US dollar accounts.
Accordingly, the movement in the balance between periods is largely
due to changes in USD/GBP exchange rates.
Cashflow metrics (GBPm) Six months ended YoY
30 June
2023 2022 %
Operating Free Cash Flow (7) 37.9 12.3 208%
Cash Conversion (8) 95% 86%
============================== ========= ======== =====
(7) Operating Free Cash Flow is defined as Adjusted EBITDA of
GBP39.9 million (H1 '22: GBP14.3 million) less purchase of
intangible assets of GBP2.0 million (H1 '23: GBP2.0 million).
(8) Defined as Operating Free Cash Flow, divided by Adjusted
EBITDA.
Operating free cash flow grew from GBP12.3 million in the six
months ended 30 June '22 to GBP37.9 million in the six months ended
30 June 2023, demonstrating the strong cash flow that the business
has delivered as it continues to scale up, whilst at the same time
making investments in intangibles assets of GBP2.0 million (H1 '22
GBP2.0 million).
Disposal of CAIM and JCF
Crown Agents Investment Management Limited (referred to as
"CAIM") and JCF Nominees Limited (referred to as "JCF") were
controlled by the Group until 31 March 2023. The company reported a
gain on disposal of GBP68k on completion of the disposal of CAIM
and JCF. The financial statements report the results of CAIM and
JCF as discontinued operations and assets/liabilities held for
sale.
Dividends
Prior to Listing the Company declared dividends to its
shareholders amounting to GBP5.6 million on 26 April 2023 and
GBP5.7 million on 1 June 2023 (six months ended 30 June 2022:
nil).
CAB Tech Holdco Limited, a subsidiary of the company, declared a
total dividend of GBP17.1 million on 19 April 2023 (30 June 2022:
nil), of which GBP1.5 million is payable externally to CAB Tech
Holdco Limited minority shareholders.
Listing and Reorganisation
The Company was re-registered as a public limited company on 4
July 2023.
On 11 July 2023 the Company's shares were admitted to trading on
the London Stock Exchange ("Admission"). After 30 June 2023, but
immediately prior to Admission, the final Reorganisation steps were
implemented which included:
(a) The Company split its existing 10,000 B ordinary shares of
GBP0.5913044 each into 5,913,044 B ordinary shares with a nominal
value of GBP0.001 each
(b) A ordinary shares and B ordinary shares in issue at 30 June
2023 were re-designated into a new single class of ordinary shares
with a nominal value of GBP0.001 each
(c) Each of the Ordinary Shares was then subdivided into three
Ordinary Shares with a nominal value of 0.033 1/3 pence each
(d) Following this step, the company's share capital comprised 221,739,135 ordinary shares
(e) The Company issued 32,404,083 Ordinary Shares to
shareholders in CAB Tech Holdco Limited in exchange for CAB Tech
Holdco Limited's shares
Following step (e) at Admission 254,143,218 Ordinary Shares are
in issue.
Alternative Earnings per share on a post reorganisation
basis
Earnings per share calculated in accordance with IAS 33 for the
six months ended 30 June 2023 and 30 June 2022 is 6.1 pence per
share and 3.7 pence per share respectively (see Note 22 in the
Interim Condensed Consolidated Financial Statements). Earnings per
share excludes the effects of the shares issued to shareholders of
CAB Tech Holdco Limited (CTH) (see step (e) above).
In order to provide an indication of the effect of the issue of
shares to CTH shareholders and reflect the number of shares in
issue on Admission we present an alternative earnings per
share:
Alternative Earnings per Share Profit Shares Earnings Per share
after tax in Issue
Six months ended 30 June 2023 GBP'000 Number pence
Earnings per share per IAS33 13,578(1) 221,739,135 6.1
Impact of share exchange on non-controlling interest and shares in
issue 1,024(2) 32,404,083(3)
---------- --------------
Alternative earnings per share on a post-Reorganisation basis 14,602 254,143,218 5.7
---------- --------------
Six months ended 30 June 2022
Basic and fully diluted earnings per share per IAS33 8,247(1) 221,739,135 3.7
Impact of share exchange on non-controlling interest and shares in
issue 617(2) 32,404,083(3)
---------- --------------
Alternative earnings per share on a post-Reorganisation basis 8,864 254,143,218 3.5
===================================================================== ========== ============== ===================
(1) Profit after tax for the period attributable to owners of
CAB Payments
(2) Profit after tax for the period attributable to
Non-controlling interests
(3) Number of CAB Payments shares issued in the share exchange
see "Listing and Reorganisation" above
The alternative earnings per share have been calculated using
the unweighted number of Ordinary Shares issued by the Company as
at date of Admission as the denominator. The numerator includes the
profit after tax for the period ended 30 June 2023 attributable to
the parent and to non-controlling interests.
The alternative earnings per share for the period ended 30 June
2022 has been calculated on the same basis.
Alternative earnings per share on a post-reorganisation basis
for the six months ended 30 June 2023 and 30 June 2022 are 5.7
pence per share and 3.5 pence per share respectively.
Related Parties
Please refer to note 25 to the interim condensed consolidated
financial statements where detailed disclosures on related parties
are made.
Principal Risks and Uncertainties
The principal risks which could have a material impact on the
Group's performance as set out in the Group's prospectus dated 27
June 2023, remain valid at the date of this report and for the
remainder of the financial year. The key risks in no specific order
of priority are:
-- The Group receives certain services from third parties that
are significant for its business and changes or failures in the
provision of these services by third parties could impact the
Group's services
-- The Group's growth may not be sustainable at its current
levels in the future, which could have an adverse impact on its
business and future prospects
-- The Group's business is dependent on the macroeconomic and
political environment in the countries where it provides products
and services
-- The Group's earnings could be negatively impacted by fluctuations in FX rates
-- Employee misconduct or errors may be unable to be prevented
or deterred by the Group and may cause financial loss or damage to
the Group's reputation
-- The Group's business is reliant on its ability to attract,
retain, and develop highly-skilled employees
-- The Group may not be able to retain its existing customer
base, which could affect its business and results of operations
-- As the Group expands its products and services globally, it
may face challenges that could adversely affect its business or
future growth
-- As a result of containing a UK-regulated bank, the Group is
subject to extensive legislation and regulation, and any failure by
the Group to comply with applicable laws and regulations could
expose it to significant costs and reputational damage
-- The Group allows customers to send cross-border payments to
and from numerous jurisdictions outside the United Kingdom, which
exposes it to a variety of laws and regulations. Any failure by the
Group to comply with these local laws could have an adverse effect
on its business
-- The Group is subject to laws and regulations relating to
anti-money laundering, counterterrorism, anti-bribery, and
sanctions, and any failure by the Group to prevent or detect
violations to these could expose the Group to liability
-- The Group is dependent on its technology, and any service
delays, system failures, cyberattacks, or other interruptions could
disrupt the Group's ability to continue to provide its products or
services, harm the Group's reputation and/or subject it to other
liabilities
Directors' Responsibility Statement
The Directors confirm that these Interim condensed consolidated
Financial Statements have been prepared in accordance with
International Accounting Standard 34 'Interim Financial Reporting',
as adopted by the United Kingdom and that the interim management
report includes a fair review of the information required by DTR
4.2.7R and DTR 4.2.8R, namely:
-- an indication of important events that have occurred during
the first six months and their impact on the condensed set of
financial statements, and a description of the principal risks and
uncertainties for the remaining six months of the financial year;
and
-- related party transactions that have taken place in the first
six months of the financial year and that have materially affected
the financial position or performance of the Group during that
period; and any changes in the related party transactions described
in the last annual report and Accounts that could do so. These have
been disclosed in Note 25.
The Directors of CAB Payments Holdings plc are listed in the
Prospectus, taking effect from Admission to London Stock Exchange.
There have been no changes of director since Admission. A list of
Directors is maintained on the Company's website,
www.cabpayments.com.
The Directors are responsible for the maintenance and integrity
of the Company's website.
By order of the Board,
Bhairav Trivedi
Chief Executive Officer
Richard Hallett
Chief Financial Officer
12 September 2023
Independent Review Report to CAB Payments Holdings plc
Conclusion
We have been engaged by CAB Payments Holdings plc (the
"Company") and its subsidiaries (the "Group") to review the
condensed set of consolidated financial statements in the
half-yearly interim financial report for the six months ended 30
June 2023 which comprises the interim condensed consolidated
statement of profit or loss and other comprehensive income, the
interim condensed consolidated statement of financial position, the
interim condensed consolidated statement of changes in equity, the
interim condensed consolidated statement of cash flows and the
related notes 1 to 30.
Based on our review, nothing has come to our attention that
causes us to believe that the condensed set of consolidated
financial statements in the half-yearly financial report for the
six months ended 30 June 2023 is not prepared, in all material
respects, in accordance with UK adopted International Accounting
Standard 34 and the Disclosure Guidance and Transparency Rules of
the United Kingdom's Financial Conduct Authority.
Basis for Conclusion
We conducted our review in accordance with International
Standard on Review Engagements (UK) 2410, "Review of Interim
Financial Information Performed by the Independent Auditor of the
Entity" issued by the Financial Reporting Council for use in the
United Kingdom. A review of interim financial information consists
of making enquiries, primarily of persons responsible for financial
and accounting matters, and applying analytical and other review
procedures. A review is substantially less in scope than an audit
conducted in accordance with International Standards on Auditing
(UK) and consequently does not enable us to obtain assurance that
we would become aware of all significant matters that might be
identified in an audit. Accordingly, we do not express an audit
opinion.
We have not audited or reviewed the financial information for
the six months ended 30 June 2022 which has been included for
comparative purposes only and accordingly do not express an opinion
or conclusion thereon.
We have read the other information contained in the interim
report and considered whether it contains any apparent
misstatements or material inconsistencies with the financial
information.
As disclosed in note 1, the annual financial statements of the
Group are prepared in accordance with UK adopted International
Accounting Standards. The condensed set of consolidated financial
statements included in this half-yearly financial report has been
prepared in accordance with UK adopted International Accounting
Standard 34, "Interim Financial Reporting".
Conclusions relating to going concern
Based on our review procedures, which are less extensive than
those performed in an audit as described in the Basis for
Conclusion section of this report, nothing has come to our
attention to suggest that management have inappropriately adopted
the going concern basis of accounting or that management have
identified material uncertainties relating to going concern that
are not appropriately disclosed.
This conclusion is based on the review procedures performed in
accordance with this ISRE (UK) 2410, however future events or
conditions may cause the entity to cease to continue as a going
concern.
Responsibilities of directors
The interim report, including the financial information
contained therein, is the responsibility of, and has been approved
by, the directors. The directors are responsible for preparing the
interim report in accordance with UK adopted International
Accounting Standard 34 and the Disclosure Guidance and Transparency
Rules of the United Kingdom's Financial Conduct Authority.
In preparing the half-yearly financial report, the directors are
responsible for assessing the Group'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 Group or to cease
operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the review of the financial
information
In reviewing the half-year report, we are responsible for
expressing to the Company a conclusion on the condensed set of
consolidated financial statements in the half-yearly financial
report. Our conclusion, including our Conclusions relating to going
concern, are based on procedures that are less extensive than audit
procedures, as described in the Basis for Conclusion paragraph of
this report.
Use of the review report
This report is made solely to the Company in accordance with
International Standard on Review Engagements (UK) 2410 issued by
the Financial Reporting Council and our Engagement Letter dated 3
August 2023. Our work has been undertaken so that we might state to
the Company those matters we are required to state to it in an
independent review 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, for our review work, for this
report, or for the conclusions we have formed.
Mazars LLP
Chartered Accountants
30 Old Bailey
London EC4M 7AU
12 September 2023
Notes:
(a) The maintenance and integrity of the CAB Payments Holdings
plc website is the responsibility of the directors; the work
carried out by us does not involve consideration of these matters
and, accordingly, we accept no responsibility for any changes that
may have occurred to the interim report since it was initially
presented on the web site.
(b) Legislation in the United Kingdom governing the preparation
and dissemination of financial information may differ from
legislation in other jurisdictions.
Interim condensed consolidated statement of profit or loss and
other comprehensive income for the six months ended 30 June
2023
Six months ended 30
June
Note 2023 2022
GBP'000 GBP'000
Continuing operations
Interest income
* interest income calculated using Effective Interest
Rate (EIR) 4 23,681 3,994
* other interest and similar income 4 82 1
Interest expense 4 (12,724) (1,627)
=========== ===========
Net Interest Income 11,039 2,368
=========== ===========
Gains on Money Market Funds 4,551 501
Net gain/(loss) on financial assets mandatorily
held at fair value through profit or loss 1,089 (78)
Fees and commission income 5 6,981 7,502
Net foreign exchange gain 6 48,152 26,735
=========== ===========
Total income, net of interest expense 71,812 37,028
=========== ===========
Operating expenses (48,339) (25,658)
=========== ===========
* Recurring 7 (35,199) (25,658)
* Non-recurring 7 (13,140) -
=========== ===========
Reversal of impairment / (impairment loss)
on financial assets at amortised cost 321 (171)
=========== ===========
Profit before taxation 23,794 11,199
-Tax expense 8 (9,039) (2,240)
=========== ===========
Profit after tax for the period from continuing
operations 14,755 8,959
Discon t inued operations
Loss after tax for the period from discontinued
operations 9 (153) (95)
=========== ===========
Profit for the period 14,602 8,864
================================================================== ===== =========== ===========
The notes on pages 19 to 54 form part of these interim condensed
consolidated financial statements
Interim condensed consolidated statement of profit or loss and
other comprehensive income for the six months ended 30 June 2023
(continued)
Six months ended
30 June
2023 GBP'000 2022
GBP'000
Profit for the period attributable to: Note
- Owners of the parent 13,578 8,247
- Non-controlling interests 23 1,024 617
============= =========
14,602 8,864
============= =========
Other comprehensive income for the period:
Items that may be reclassified subsequently
to profit or loss:
Foreign exchange (losses)/gains on translation
of foreign operations (138) 51
Items that will not be reclassified subsequently
to profit or loss :
Movement in investment revaluation reserve
for equity instruments at fair value through
other comprehensive income - 88
Income tax relating to these items - (17)
Other comprehensive (loss)/ income for
the period net of tax (138) 122
============= =========
Total comprehensive income for the period 14,464 8,986
============= =========
Total comprehensive income attributable
to:
* Owners of the parent 13,450 8,360
* Non-controlling interests 23 1,014 626
============= =========
14,464 8,986
============= =========
Six months ended
30 June
Basic and diluted earnings per share 22 2023 2022
pence pence
Continuing operations 6.2 3.8
Discontinued operations (0.1) (0.1)
============= =========
Total basic and diluted earnings per
share 6.1 3.7
================================================== ===== ============= =========
The notes on pages 19 to 54 form part of these interim condensed
consolidated financial statements.
Interim condensed consolidated statement of financial position
as at 30 June 2023
As at As at
30 June 31 December
2023 2022 (restated)
Note GBP'000 GBP'000
Assets
Cash and balances at central banks 10 577,572 607,358
Money market funds 11 164,982 209,486
Loans and advances on demand to banks 12 107,917 90,209
Other loans and advances to banks 12 70,270 85,465
Other loans and advances to non-banks 12 5,242 12,447
Derivative financial assets 13 4,048 6,567
Unsettled transactions 15 16,265 12,960
Investments in debt securities 14 432,534 414,061
Investments in equity securities 473 488
Other assets 15 22,732 19,520
Accrued income 26 814 856
Property, plant and equipment 16 1,313 1,579
Right of use assets 913 1,134
Intangible assets 17 21,529 21,919
============== =================
1,426,604 1,484,049
Assets classified as held for sale 9 - 1,387
============== =================
T otal assets 1,426,604 1,485,436
============== =================
Liabilities
Customer accounts 18 1,245,989 1,305,551
Overdrawn accounts 77 -
Derivative financial liabilities 13 8,023 4,543
Unsettled transactions 19 16,661 25,782
Other liabilities 19 17,091 11,517
Accruals 19 14,926 19,364
Lease liabilities 26 1,113 1,281
Deferred tax liability 480 316
Provisions 12 79
========== =================
1,304,372 1,368,433
Liabilities classified as held for sale 9 - 1,045
========== =================
Total liabilities 1,304,372 1,369,478
========== =================
Equity
Called up share capital 20 74 68,010
Retained earnings 21 114,701 40,179
Investment revaluation reserve 96 96
Foreign currency translation reserve (159) (31)
========== =================
Equity attributable to owners of the parent 114,712 108,254
Non-controlling interests 23 7,520 7,704
========== =================
Shareholders' funds 122,232 115,958
========== =================
Total equity and liabilities 1,426,604 1,485,436
============================================= ==== ========== =================
The notes on pages 19 to 54 form part of these interim condensed
consolidated financial statements.
Interim condensed consolidated statement of changes in equity
for the six months ended 30 June 2023
Attributable To Owners Of The Parent
=====================================================
Foreign
Investment currency Total
Share Retained revaluation translation Non-Controlling Shareholders'
Capital Earnings reserve reserve Total Interest (NCI) Funds
========= ========= ============ ============= ========= ================ ==============
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
========= ========= ============ ============= ========= ================ ==============
Balance at 1
January 2023 68,010 40,179 96 (31) 108,254 7,704 115,958
Profit for the
period (note
21) - 13,578 - - 13,578 1,024 14,602
Other
comprehensive
income:
Foreign
exchange
losses on
translation
of foreign
operations - - - (128) (128) (10) (138)
Other
comprehensive
loss - - - (128) (128) (10) (138)
Total
comprehensive
income/
(loss) - 13,578 - (128) 13,450 1,014 14,464
Transactions
with owners in
their capacity
as owners:
Share based
payment
expense - 978 - - 978 46 1,024
Capital
injection in
subsidiary
(note 21) - 3,330 - - 3,330 296 3,626
Share capital
reduction
(note 20) (67,936) 67,936 - - - - -
Dividends
declared
(note 21) - (11,300) - - (11,300) (1,540) (12,840)
Total (67,936) 60,944 - - (6,992) (1,198) (8,190)
Balance at 30
June 2023 74 114,701 96 (159) 114,712 7,520 122,232
Balance at 1
January 2022 68,010 8,442 30 (141) 76,341 5,222 81,563
Profit for the
period (note
21) - 8,247 - - 8,247 617 8,864
Other
comprehensive
income
Foreign
exchange
gains on
translation
of foreign
operations - - - 47 47 4 51
Movement in
investment
revaluation
reserve for
equity
instruments
at fair value
through other
comprehensive
income - net
of tax - - 66 - 66 5 71
Other
comprehensive
income - - 66 47 113 9 122
Total
comprehensive
income - 8,247 66 47 8,360 626 8,986
Transactions
with owners in
their capacity
as owners:
Share based
payment
expense - 418 - - 418 - 418
Change in NCI
percentage - (38) - - (38) 38 -
Total - 380 - - 380 38 418
Balance at 30
June 2022 68,010 17,069 96 (94) 85,081 5,886 90,967
The notes on pages 19 to 54 form part of these interim condensed
consolidated financial statements.
Interim condensed consolidated statement of cash flows for the
six months ended 30 June 2023
Six months ended 30 June
Note 2023 2022
GBP'000 GBP'000
Cash flow from operating activities 24 (21,494) (122,701)
Tax paid (9,780) (1,390)
Payments for interest on lease liabilities (34) (7)
========== ===========
Net cash used in operating activities (31,308) (124,098)
========== ===========
Cash flow from investing activities
Purchase of property, plant and equipment 16 (160) (99)
Purchase of intangible assets 17 (2,017) (1,950)
Proceeds from sale of investment in CAIM 9 1,846 -
========== ===========
Net cash used in investing activities (331) (2,049)
========== ===========
Cash flow from financing activities
Repayment of principal portion of the
lease liability (168) (168)
Proceeds from shares issued to non-controlling
interests 3,626 -
Dividends paid (12,840) -
Increase in overdraft accounts 77 853
========== ===========
Net cash inflow from financing activities (9,305) 685
========== ===========
Net decrease in cash and cash equivalents (40,944) (125,462)
Cash and cash equivalents at the beginning
of the period 907,053 1,120,109
========== ===========
* Cash and balances at central banks 607,358 676,492
* Money market funds 209,486 336,737
* Loans and advances on demand to banks 90,209 106,880
========== ===========
Exchange (losses)/ gains on cash and cash
equivalents (15,638) 44,986
========== ===========
Cash and cash equivalents at the end
of the period 10 850,471 1,039,633
========== ===========
The notes on pages 19 to 54 form part of these interim condensed
consolidated financial statements.
Notes to the interim condensed consolidated financial statements
for the six months ended 30 June 2023
1. STATEMENT OF ACCOUNTING POLICIES
(a) General Information
On 6 March 2023 the Company changed its name to CAB Payments
Holdings Limited from CABIM Limited. On 4 July 2023 the Company was
re-registered as a public limited company, CAB Payments Holdings
plc in order to align with its strategic objectives. The address of
its registered office is Quadrant House, The Quadrant, Sutton,
Surrey, SM2 5AS. The ordinary shares of the Company were admitted
to conditional trading on the London Stock Exchange on 6 July 2023
and unconditional trading on 11 July 2023. The Company's shares
trade under the ticker code of CABP.L.
CAB Payments Holdings plc ("the Company" or "CAB Payments") and
its subsidiaries ("the Group") provide regulated banking services
that connect emerging and frontier markets to the rest of the
world, using foreign exchange ("FX") and payments technology.
(b) Basis of Preparation
The interim condensed consolidated financial statements
comprises the interim condensed consolidated statements of profit
or loss and other comprehensive income, interim condensed
consolidated statement of financial position, interim condensed
consolidated statement of changes in equity, interim condensed
consolidated statement of cash flows and related notes of the Group
for the six months ended 30 June 2023.
The interim condensed consolidated financial statements have
been prepared in accordance with the Disclosure Guidance and
Transparency Rules of the Financial Conduct Authority and with UK
adopted International Accounting Standard 34 "Interim Financial
Reporting" .
The interim condensed consolidated financial statements have not
been audited and do not constitute statutory accounts within the
meaning of Section 434 of the Companies Act 2006 but has been
reviewed by the auditor in accordance with International Standard
on Review Engagements (UK) 2410 issued by the Financial Reporting
Council. The Group's statutory accounts for the year ended 31
December 2022, prepared in accordance with UK adopted international
accounting standards, have been delivered to the Registrar of
Companies. The report of the auditor on these financial statements
was unqualified, did not draw attention to any matters by way of
emphasis and did not contain any statement under section 498(2) or
(3) of the Companies Act 2006.
The interim condensed consolidated financial statements should
be read in conjunction with the Annual Report and Financial
Statements for the year ended 31 December 2022 from which the
comparative information as at 31 December 2022 has been derived.
The interim condensed consolidated financial statements dated 30
June 2023 have been reviewed, not audited. The interim condensed
consolidated financial statements dated 30 June 2022 have not been
audited or reviewed, while comparative financial statements dated
31 December 2022 have been audited as part of the 2022 financial
statements unless noted.
Comparatives have been restated in line with current year
disclosures. Details of these changes are set out in Note 12. This
restatement did not result in a change of accounting policies and
there is no impact to profit or loss and equity.
The interim condensed consolidated financial statements are
presented in British Pound Sterling ("GBP"). All values are rounded
to the nearest thousand (GBPGBP'000), except when otherwise
indicated.
(c) Accounting policy
The accounting policies and presentation applied by the Group in
these interim condensed consolidated financial statements are
consistent with those applied in the Annual Report and Financial
Statements for the year ended 31 December 2022 and those expected
to be applied in the year to 31 December 2023.
The annual financial statements of the Group will be prepared in
accordance with UK adopted International Accounting Standards (UK
adopted International Financial Reporting Standards ("IFRSs")).
The Group has adopted the following new or amended IFRSs and
interpretations that are effective from 1 January 2023, none of
which had any impact on the Group's interim condensed consolidated
financial statements.
Amendments to IAS 8 Changes in accounting estimates and errors/
Accounting Policies definition of accounting estimates - effective
for annual reporting periods commencing
1 January 2023.
Amendments to IAS 12 Implementation of Pillar 2 tax - effective
for annual reporting periods commencing
1 January 2023.
================================================
Amendments to IFRS 17 Effective for annual reporting periods
Insurance Contracts commencing 1 January 2023.
================================================
Amendments to IFRS Practice Effective for annual reporting periods
Statement 2 Making Materiality commencing 1 January 2023.
Judgements - Disclosures
of Accounting Policies
================================================
(d) New and revised IFRS accounting standards in issue but not
yet effective
At the date of authorisation of these interim condensed
consolidated financial statements, the Group has not applied the
following new and revised IFRS that have been issued but are not
yet effective.
Amendments to IAS 1 Classification of Liabilities as Current
or Non-current - effective 1 January 2024.
The directors do not expect that the revision of the Standard
listed above will have a material impact on the interim condensed
consolidated financial statements of the Group in future
periods.
(e) New sustainability standards issued by the International
Sustainability Standards Board (ISSB) effective 1 January 2024
The International Sustainability Standards Board (ISSB) issued
its first two sustainability reporting standards on 26 June 2023.
This included:
-- General Requirements for Disclosure of Sustainability-related
Financial Information (IFRS S1), the core framework for the
disclosure of material information about sustainability-related
risks and opportunities across an entity's value chain
-- Climate-related Disclosures (IFRS S2), the first thematic
standard issued that sets out requirements for entities to disclose
information about climate-related risks and opportunities
They have not yet been adopted for use in the UK. The Directors
are in the process of assessing the implications of these
standards.
(f) Going concern
The Directors have considered the financial position of the
Group, including the net asset position, regulatory capital
requirements and estimated future cash flows and have concluded
that there is reasonable expectation that the Group have adequate
resources to continue in operational existence for a period of 12
months from when these interim condensed consolidated financial
statements are authorised for issue and that the Group will be able
to meet its obligations as they fall due. Furthermore, the
Directors are of the view that:
i. there are no material uncertainties relating to events or
conditions that cast significant doubt on the Group's ability to
continue as a going concern;
ii. there are no significant judgements made by management in
determining whether the adoption of the going concern is
appropriate and
iii. there are no material uncertainties to disclose in respect of going concern.
Accordingly, the interim condensed consolidated financial
statements have been prepared on the going concern basis.
(g) Share capital
On issue of ordinary shares, any consideration received net of
any directly attributable transaction costs is included in
equity.
(h) Earnings per share
Basic earnings per share
Basic earnings per share is calculated on the Group's profit or
loss after taxation attributable to the parent entity and based on
weighted average of ordinary shares at the end of the period.
Diluted earnings per share
Diluted earnings per share is calculated on the Group's profit
or loss after taxation attributable to the parent entity and based
on weighted average of ordinary shares at the end of the period and
the weighted average number of ordinary shares that would be issued
on conversion of all the dilutive potential ordinary shares into
ordinary shares.
(i) Dividend
Dividends are recognised in the financial statements when they
are declared and approved by the Board of Directors. This is
because the approval of a dividend creates a legal obligation for
the Company to pay the dividend to its shareholders. Dividends are
paid out of distributable reserves which are defined as the net
profit for the period plus any undistributed profits brought
forward.
2. CRITICAL ACCOUNTING JUDGEMENTS AND ESTIMATES
In preparing the interim condensed consolidated financial
statements, management has made judgements and estimates that
affect the application of accounting policies and the reported
figures. Management assessed that there were no material changes in
the current period to the critical accounting estimates and
judgements, as disclosed in Note 2 in the 2022 Annual Report and
Financial Statements.
3. SEGMENT REPORTING
Operating segments are determined by the Group's internal
reporting to the Chief Operating Decision Maker (CODM). The CODM
has been determined to be the Group's Executive Committee. The
information regularly reported to the executive committee for the
purposes of resource allocation and the assessment of performance,
is based wholly on the overall activities of the Group. Based on
the Group's business model, the Group has determined that it has
only one reportable segment of continuing operations.
The CODM assess the profitability of the segment based on a
measure of adjusted Earnings Before Interest, Tax, Depreciation,
Amortisation and Non-recurring operating expenses (" Adjusted
EBITDA").
All revenue from external customers is generated through its
operations located in the UK and on that basis is wholly
attributable to the UK and all non-current assets, other than
financial instruments and deferred tax assets, are located in the
UK.
Income
The Group derives its income from continuing and discontinued
operations as follows:
Income by Product Type
Six months ended 30 June 2023 Continuing Discontinued
operations operations Total
GBP'000 GBP'000 GBP'000
FX 37,944 4 37,948
Payments 17,113 855 17,968
Banking services and other income 16,755 68 16,823
============= =============== ==========
Total income, net of interest expense 71,812 927 72,739
Other comprehensive income for
the period
Foreign exchange loss on translation
of foreign operations (138) - (138)
============= =============== ==========
71,674 927 72,601
Less clearing costs (928) - (928)
============= =============== ==========
Revenue net of interest expense 70,746 927 71,673
======================================= ============= =============== ==========
Income by Product Type
Six months ended 30 June 2022 Continuing Discontinued
operations operations Total
GBP'000 GBP'000 GBP'000
FX 20,284 (39) 20,245
Payments 13,185 1,619 14,804
Banking services 3,559 - 3,559
============= =============== ==========
Total income net of interest expense 37,028 1,580 38,608
Other comprehensive income for
the period
Foreign exchange gain on translation
of foreign operations 51 - 51
Movement in investment revaluation
reserve for equity instruments at
fair value through other comprehensive
income 71 - 71
============= =============== ==========
37,150 1,580 38,730
Less clearing costs (982) - (982)
============= =============== ==========
Revenue net of interest expense 36,168 1,580 37,748
========================================= ============= =============== ==========
FX: The Group's FX revenue is derived from the difference
between the exchange rate the Group makes available to its
customers and the rate that it receives from one or more liquidity
providers from whom it sources the relevant currency. Revenue
categorised as FX is from customers with a need to exchange a bulk
amount from one currency for another without onward payment to
another party.
Payments: The Group's payments revenue include cross currency
payments, same currency payments (corresponding activity income,
and account management fees), pension payments and platform
revenue. Cross currency payments comprise margin derived from
bid-ask spreads on foreign currency conversion and fees paid by
customers to transfer money from one country to another to third
parties.
Same currency relates to payment services provided for payments
transacted without an exchange of foreign currency largely relating
to major market currency clearing and includes fees for account
management activities and payments execution. Pension payments fees
relate to amounts earned on processing of pension scheme foreign
currency payments. Platform revenue relates to recurring fixed fees
rather than fees earned on transaction volumes.
Banking Services: The Group also generates income from trade
finance, liquidity services (including trade finance and letters of
credit), and risk management consulting fees. The Group takes
customer funds earmarked for other needs as customer deposits and
makes short-term investment in the money market to generate net
interest income.
Seasonality: as a growing business, the Group typically records
higher revenues in the second half of the year largely driven by
FX. The business achieves 40% of annual revenue in H1 and 60% in
H2. For example, total income for FY22 was GBP109 million, of which
GBP37 million (33%) was in the first half of the year and GBP72
million (66%) in the second half.
Profitability: The Group measures profitability for the
reporting segment on an Adjusted EBITDA. Adjusted EBITDA is used as
a key profit measure because it shows the results of normal, core
operations exclusive of income or charges that are not considered
to represent the underlying operational performance. Adjusted
EBITDA is useful as a measure of comparative operating performance
between both previous periods, and other companies as it removes
the effect of taxation, depreciation and amortisation, and
non-recurring operating expenses, as well as items relating to
capital structure.
Reconciliation of Profit before
tax to Adjusted EBITDA Continuing Discontinued
Six months ended 30 June 2023 operations Operations Total
GBP'000 GBP'000 GBP'000
Profit / (loss) before tax 23,794 (219) 23,575
Adjusted for:
Amortisation (Note 7) 2,372 13 2,385
Depreciation(1) (Note 7) 636 - 636
Non - recurring operating expenses
(Note 7) 13,140 - 13,140
------------- --------------- ----------
Adjusted EBITDA(2) 39,942 (206) 39,736
============= =============== ==========
1. Balance includes depreciation on property plant and equipment
and depreciation on right of use of asset
2. Adjusted EBITDA - Earnings before Interest (but including net
interest income - see note 4) Tax, Depreciation and Amortisation
and non-recurring operating expense
Reconciliation of Profit before
tax to Adjusted EBITDA Continuing Discontinued
Six months ended 30 June 2022 operations Operations Total
GBP'000 GBP'000 GBP'000
Profit / (loss) before tax 11,199 (116) 11,083
Adjusted for:
Amortisation (Note 7) 2,503 26 2,529
Depreciation(1) (Note 7) 566 - 566
Non - recurring operating expenses - - -
(Note 7)
------------- --------------- ----------
Adjusted EBITDA(2) 14,268 (90) 14,178
============= =============== ==========
1.Balance includes depreciation on property plant and equipment
and depreciation on right of use of asset
2. Adjusted EBITDA - Earnings before Interest (but including net
interest income - see note 4) Tax, Depreciation and Amortisation
and non-recurring operating expense
Note: the 31 December 2022 financial statements included a
breakdown of the Continuing Operations category between Crown
Agents Bank Limited and Other. Due to the immateriality of this
second category the analysis not been provided in these financial
statements.
4. NET INTEREST INCOME
Net Interest Income six months ended 30 June
2 023 2 022
GBP'000 GBP'000
Interest Income
Interest on cash and balances at central banks 13,424 2,045
Interest on loans and advances 2,632 1,264
Interest on investment in debt securities 7,625 685
-------------- -------------
Total interest income calculated using EIR 23,681 3,994
============== =============
Other interest income and similar income 82 1
Total other interest and similar income 82 1
============== =============
Interest Expense
Financial liabilities measured at amortised cost (12,646) (1,614)
Interest expense on lease liabilities (34) (7)
Other interest expense (44) (6)
Total interest expense (12,724) (1,627)
============== =============
Total Net Interest Income 11,039 2,368
============== =============
5. FEES AND COMMISSION INCOME
S ix months ended 30 June
2023 2 022
GBP'000 GBP'000
Fees and commission income :
Account management and payments 5,764 5,761
Pension payment fees 527 523
Trade finance 327 363
Electronic platform fees 363 445
Introductory fees - 410
Total fees and commission income 6,981 7,502
========= =========
6. NET FOREIGN EXCHANGE GAIN
Six months ended
30 June
2023* 2 022*
Net Foreign Exchange Gain : GBP'000 GBP'000
Profit on settlement of foreign exchange contracts,
fair value gains on derivatives**, and remeasurement
of non-sterling balances 37,944 20,285
Foreign exchange gains on payment transaction
revenue 10,208 6,450
Net Foreign Exchange Gain 48,152 26,735
======================================================= ========= =========
*Includes only continuing operations. Net foreign exchange
transactions relating to discontinued operations is included in
Note 9. **Foreign exchange derivative financial instruments are
mandatorily held at fair value through profit or loss.
7. OPERATING EXPENSES
Six months ended 30 June
2 023 2 022
Operating Expenses : GBP'000 GBP'000
Staff costs and directors' emoluments
Salaries and bonuses 16,615 11,783
Share based payments 1,024 418
Social security costs 1,880 1,086
Pension costs 994 657
============= ============
Total staff costs and directors' emoluments 20,513 13,944
============= ============
Clearing costs 928 982
============= ============
Depreciation and amortisation
Amortisation of intangible assets 2,372 2,503
Depreciation of property, plant and equipment 414 414
Depreciation charge for right-of-use assets 222 152
============= ============
Total depreciation and amortisation 3,008 3,069
============= ============
Other operating expenses(1) 10,750 7,663
============= ============
Total recurring operating expenses 35,199 25,658
============= ============
Non-recurring operating expenses(2) 13,140 -
============= ============
Total operating expenses 48,339 25,658
============= ============
Non-recurring operating expenses can be analysed as follows:
Non-performance staff bonuses relating to take-on commitments 2,254 -
Professional costs incurred in connection with the listing 10,886 -
============= ============
Total Non-recurring operating expenses 13,140 -
============= ============
(1) Other operating expenses includes bank charges, assurance
services, software license, and other software services.
(2) Non-recurring operating expenses consist of material
non-recurring items that are considered exceptional in nature by
virtue of their size and/or incidence and as a result of arising
outside of the normal trading of the Group.
The monthly average number of full-time equivalent staff
employed within the Group, including executive directors, was 313
in the six months ended 30 June 2023 (six months ended 30 June
2022: 212).
8. TAX EXPENSE
Six months
Analysis of Tax Charge for the Period ended 30 June
2023 2022
GBP'000 GBP'000
Current tax
Corporation tax based on the taxable profit for
the period 8,913 2,256
========= =========
Total current income tax for the period 8,913 2,256
========= =========
Deferred tax
Deferred tax credit in profit or loss 126 (16)
========= =========
Total deferred tax expense for the period 126 (16)
========= =========
Total tax charge for the period 9,039 2,240
================================================= ========= =========
Income tax expense for the current period is calculated
representing the best estimate of the annual effective tax rate
expected for the full year by geographical unit applied to the
pre-tax income of the six month period, which is then adjusted for
tax on non-recurring costs.
The effective tax rate for the six months ended 30 June 2023 is
38% (six months ended 30 June 2022: 20%). The effective tax rate
materially exceeds the applicable tax rate since most of the
non-recurring expenses, (i.e. relating to the Admission) are not
deductible for tax purposes.
The Finance Act 2021 enacted that from 1 April 2023 the main
corporation tax rate increased to 25% (19% previously). In
addition, there is a permanent difference due to banking surcharge
levy of 3% (8% previously) in relation to taxable profits of banks
in excess of GBP100 million (GBP25 million previously) from 1 April
2023. The effects of this increase are reflected in the interim
condensed consolidated financial statements. The figures above
incorporate the increased tax rate in respect of timing differences
expected to reverse after that date.
9. DISCONTINUED OPERATIONS, ASSETS AND LIABILITIES CLASSIFIED AS
HELD FOR SALE
As at As at
30 June 31 December
Assets and liabilities classified as held 2023 2022
for sale GBP'000 GBP'000
Assets classified as held for sale - 1,387
Liabilities classified as held for sale - 1,045
=========================================== =========== =============
The sale of Crown Agents Investments Managements Limited
("CAIM") and JCF Nominees Limited ("JCF") was completed on 31 March
2023. As at 31 March 2023, the Group lost control of assets
totalling GBP1,275k and liabilities totalling GBP634k. The
consideration of GBP1,846k received on sale included cash and cash
equivalents of GBP1,611k and other amounting to GBP235k.
In accordance with IFRS 5 'Non-current Assets Held for Sale and
Discontinued Operations' the results of CAIM and JCF are presented
as discontinued operations. The comparative 2022 financial
statements in the interim condensed consolidated statement of
profit or loss and other comprehensive income has been presented as
discontinued for the purposes of enabling meaningful comparison.
The results from discontinued operations, which are included in the
interim condensed consolidated statement of profit or loss and
other comprehensive income, are set out below:
Results from discontinued operations Six months Ended 30 June
2023* 2022
GBP'000 GBP'000
Interest income 25 -
Fees and commission income 830 1,603
Net foreign exchange gain/(loss) 4 (23)
Operating income 859 1,580
Operating expenses (1,146) (1,696)
Loss before tax (287) (116)
Income tax credit 66 21
Loss for the financial period (221) (95)
Profit on sale of discontinued
operation 68 -
Other comprehensive income - -
Total comprehensive income (153) (95)
====================================== ============= ============
The loss from discontinued operations of GBP221k (six months
ended 30 June 2022: GBP95k) is attributable entirely to the owners
of the Company. There was no other comprehensive income
attributable to discontinued operations.
Six months ended 30
Cash flows from discontinued operations June
2023* 2022
GBP'000 GBP'000
Cash flow from operating activities (536) (36)
Cash and cash equivalents at the end
of the period 1,611 1,962
=========================================== =========== ==========
* results represent 3 months to 31 March 2023 when CAIM was
sold.
10. CASH AND BALANCES AT CENTRAL BANKS
As at As at
30 June 31 December
2023 2022
Cash and Balances at Central GBP'000 GBP'000
Banks
Cash and balances at central
banks 577,572 607,358
Cash and cash equivalent balances 577,572 607,358
========== ===============
Cash and balances at central banks include no encumbered assets
(2022 - GBPnil) and the expected credit loss is nil (31 December
2022: nil).
Reconciliation to interim condensed consolidated statement
of cash flows
The cash and balances at central banks included in the interim
condensed consolidated statement of cash flows are presented
as follows:
As at As at
30 June 30 June
2023 2022
GBP'000 GBP'000
Cash and balance at central banks 577,572 596,171
Loans and advances on demand
to banks (Note 12) 107,917 116,777
Money market funds (Note 11) 164,982 326,685
---------- ---------------
Cash and cash equivalents per
interim condensed consolidated
statement of cash flows 850,471 1,039,633
Cash and balances at central banks and Loans and advances on
demand to banks are measured at amortised cost as they meet the
Solely Payments of Principal and Interest 'SPPI' criterion and are
held to collect the contractual cashflows.
11. MONEY MARKET FUNDS
As at
As at 31 December
30 June 2023 2022
Open Ended Investment Companies GBP'000 GBP'000
Goldman Sachs USD Treasury Liquid
Reserves Fund 46,522 209,486
Black Rock ICS USD Liquidity
Fund 19,738 -
JP Morgan USD Liquidity LVNAV
Fund 98,722 -
164,982 209,486
============== ==============
Component of Money Market Funds
included in Interim condensed
consolidated statement of cashflows As at As at
under: 30 June 2023 30 June 2022
GBP'000 GBP'000
Cash and cash equivalent balances 164,982 326,685
Money market funds are mandatorily held at fair value through
profit or loss as they do not satisfy the SPPI criterion. The funds
are all rated AAA based on a basket of credit ratings agencies, all
approved by the Financial Conduct Authority. Refer to Note 27 on
fair value measurements for further details.
12. LOANS AND ADVANCES
These are measured at amortised cost as they meet the SPPI
criterion and are held to collect the contractual cashflows:
As at
As at 31 December
30 June 2022 (as
2023 restated)
GBP'000 GBP'000
Loans and advances
Loans and advances on demand
to banks 107,928 90,255
Other loans and advances to banks* 70,270 85,516
Other loans and advances to non-banks* 5,308 12,647
----------- -------------
Total 183,506 188,418
----------- -------------
Less: Impairment loss allowance
Loans and advances on demand
to banks (11) (46)
Other loans and advances to banks (10) (51)
Other loans and advances to non-banks (56) (200)
----------- -------------
Total (77) (297)
----------- -------------
Net Loans and advances on demand
to banks 107,917 90,209
Net Other loans and advances
to banks 70,270 85,465
Net Other loans and advances
to non-banks 5,242 12,447
----------- -------------
Net loans and advances 183,429 188,121
----------- -------------
Component of loans and advances
included in the interim condensed As at 30 As at 30
consolidated statement of cashflows June 2023 June 2022
under: GBP'000 GBP'000
Cash and cash equivalents 107,917 90,209
Total 107,917 90,209
----------- -------------
The Group's loans and advances on demand to banks include
GBP2,471k of encumbered assets (at 31 December 2022: GBP1,827k) in
relation to derivative contracts with other financial institutions
and the balance are not overdue. Other loans and advances to
non-banks includes a loan to a related party (at 30 June 2023: nil;
at 31 December 2022: GBP2,251k) (see Note 25).
*Prior period restatement note
A prior period adjustment has been made to record a
reclassification of a counterparty which was incorrectly recognised
in Other loans and advances to banks instead of Other loans and
advances to non-banks. There was no impact to profit or loss,
equity or earnings per share. The 31 December 2022 consolidated
statement of financial position has been restated as follows:
Consolidated financial statements Other loans Other loans
as at 31 December 2022: and and advances
advances to to non-banks
banks GBP'000
GBP'000
Year ended 31 December 2022 (as
previously reported) 93,164 4,748
Prior period adjustment (7,699) 7,699
------------- --------------
Year ended 31 December 2022 (as
restated) 85,465 12,447
=================================== ============= ==============
13. DERIVATIVE FINANCIAL INSTRUMENTS
At 30 June 2023 the derivative assets and liabilities are set
out below, these are held to manage foreign currency exposure and
are not designated in hedge accounting relationships for risk
management purposes:
Notional
Foreign Exchange Forwards: Principal Assets Liabilities
GBP'000 GBP'000 GBP'000
As at 30 June 2023 509,561 4,048 8,023
As at 31 December 2022 714,810 6,567 4,543
============================== =========== ======== ============
The forward foreign exchange contracts have been transacted to
economically hedge assets and liabilities in foreign currencies.
The net unrealised (loss)/ gain at the statement of financial
position date is (GBP3,975k) (at 31 December 2022: unrealised gain
GBP2,024k). These derivative financial instruments and the
underlying transactions they hedge will mature during 2024 (at 31
December 2022: mature during 2023).
The fair value of a derivative contract represents the price
that would be received to sell an asset or paid to transfer a
liability in an orderly transaction between market participants at
the measurement date (an exit price).
14. INVESTMENT IN DEBT SECURITIES
The Group's investment in debt securities consist of fixed rate
bonds issued (or guaranteed) by central and private banks. These
are measured at amortised costs as they meet the SPPI criterion and
are held to collect the contractual cashflows.
As at As at
30 June 31 December
2023 2022
GBP'000 GBP'000
Investment in debt securities at
amortised costs
Balance at the beginning of the
period 414,074
Purchases 182,239
Redemptions (163,775)
========== =============
432,538 414,074
Less: Impairment loss allowance (4) (13)
========== =============
Balance at the end of the period 432,534 414,061
========== =============
15. OTHER ASSETS AND UNSETTLED TRANSACTIONS
As at As at
30 June 31 December
2023 2022
GBP'000 GBP'000
Financial assets:
Staff loans 889 544
Balances with mobile network operators(1) 3,416 3,635
Other assets 1,462 794
Late receipts(2) 2,062 3,111
Less impairment loss (19) (62)
========= =============
Total 7,810 8,022
Non-financial assets:
Transactions debited by third party nostro
provider(3) 8,660 8,322
VAT refund 3,676 914
Prepayments 2,586 2,262
========= =============
Total other assets 22,732 19,520
========= =============
The financial assets are at amortised costs.
(1) Balances with mobile network operators (MNOs) are due to the
Group in respect of mobile money transfers. The Group charges fees
for services it provides to aid transfer of funds by its clients to
beneficiaries via mobile money using MNOs.
(2) Late receipts comprise unsettled FX trades booked on a
delivery versus payment basis and late receipts of funds in
relation to payments.
(3) These balances represent amounts that are debited in advance
or incorrectly by third party nostro providers and which will be
reversed in the following period.
Unsettled Transactions: As at As at 31 December
30 June 2022
2023 GBP'000
GBP'000
Unsettled transactions(4) 16,265 12,960
(4) Unsettled foreign currency transactions that are delayed due
to time differences, public holidays in other countries (where the
counterparties are located) or similar operational reasons. The
arising balances are short-term in nature (typically less than four
days) and were settled early the following period.
16. PROPERTY, PLANT AND EQUIPMENT
Leasehold Computer Fixtures
improvements Equipment & Fittings Total
GBP'000 GBP'000 GBP'000 GBP'000
Cost
At 1 January 2023 122 2,516 2,209 4,847
Additions - 136 24 160
Disposals - (81) (2) (83)
=============== ============ ============= ==========
At 30 June 2023 122 2,571 2,231 4,924
=============== ============ ============= ==========
Accumulated depreciation
At 1 January 2023 89 1,605 1,574 3,268
Charge to profit or loss 11 198 205 414
Disposals - (69) (2) (71)
=============== ============ ============= ==========
At 30 June 2023 100 1,734 1,777 3,611
=============== ============ ============= ==========
Net book value
=============== ============ ============= ==========
At 30 June 2023 22 837 454 1,313
=============== ============ ============= ==========
At 31 December 2022 33 911 635 1,579
=============== ============ ============= ==========
The Directors consider property and plant for indicators of
impairment at least annually, or when there is an indicator of
impairment. The recoverable amount of the business is significantly
higher than the carrying amount of the net assets and there were no
indicators of impairment identified during the period. Therefore,
no impairment charge was taken in the period.
17. INTANGIBLE ASSETS
Goodwill Core Accounting Software Other Software Brand/ Other Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Cost
At 1 January 2023 5,919 5,817 24,809 1,427 37,972
Additions - 40 1,967 10 2,017
Exchange differences - (5) - (5)
=========== ========================= =============== ============= =========
At 30 June 202 3 5,919 5,857 26,771 1,437 39,984
=========== ========================= =============== ============= =========
Accumulated amortisation and impairment
At 1 January 2023 - 4,146 11,785 122 16,053
Charged in the period - 412 1,968 22 2,402
=========== ========================= =============== ============= =========
At 30 June 2023 - 4,558 13,753 144 18,455
=========== ========================= =============== ============= =========
Net book value
=========== ========================= =============== ============= =========
A t 30 June 2023 5,919 1,299 13,018 1,293 21,529
=========== ========================= =============== ============= =========
At 31 December 2022 5,919 1,671 13,024 1,305 21,919
=========== ========================= =============== ============= =========
The Directors treat the business as a single cash-generating
unit for the purposes of testing goodwill for impairment. The
recoverable amount of goodwill was calculated by reference to the
business estimated value-in-use. The inputs and assumptions used in
the calculation of the value in use at year-end were assessed as
reasonable and appropriate for the purposes of interim financial
reporting, because there were no significant changes impacting the
business negatively. Therefore, no impairment charge was taken
during the period.
18. CUSTOMER ACCOUNTS
As at As at
30 June 31 December
2023 2022
GBP'000 GBP'000
Repayable on demand 686,667 656,419
Other customers' accounts with agreed
maturity dates or periods of notice
by residual maturity repayable:
3 months or less 490,000 479,641
1 year or less but over 3 months 61,375 169,491
2 years or less but over 1 year 7,947 -
----------- -------------
1,245,989 1,305,551
=========== =============
The total deposits from customers were from corporate customers.
Customer accounts are accounts that customers hold with the Group.
The Group is transaction led and does not borrow to finance
lending. A substantial proportion of customer accounts are current
accounts that, although repayable on demand, have historically
formed a stable deposit base.
19. OTHER LIABILITIES, ACCRUALS AND UNSETTLED TRANSACTIONS
As at As at
30 June 2023 31 December 2022
GBP'000 GBP'000
Financial liabilities
Trade creditors 601 554
Funds received in advance 6,660 4,988
Failed settlements(1) 4,735 -
Other creditors 692 9
-------------- ------------------
12,688 5,551
Non -financial liabilities
Funds received incorrectly(2) 1,334 3,500
HM Revenue & Customs 2,672 2,413
Dividend payable 347 -
Deferred income(3) 50 53
-------------- ------------------
Total other liabilities 17,091 11,517
-------------- ------------------
Accruals 14,926 19,364
-------------- ------------------
Total other liabilities and accruals 32,017 30,881
============== ==================
(1) These balances represent receipts from a nostro provider due
to failed FX settlements.
(2) These balances represent amounts that are credited
incorrectly by third party nostro providers and which will be
reversed in the following period.
(3) Deferred income relates to payments that are received from
customers before the services are provided to customers.
As at As at
30 June 31 December
2023 2022
GBP'000 GBP'000
Unsettled transactions(4) 16,661 25,782
============================== ========= =============
4. unsettled transactions result from foreign exchange
transactions that are delayed due to time differences, public
holidays in other countries (where the counterparties are located)
or similar operational reasons. The arising balances are short-term
in nature (typically less than four days) and were settled shortly
after the balance sheet date.
20. CALLED UP SHARE CAPITAL
As As
at at
30 31
June December
2023 2022
'000 '000
Authorised, allotted, issued, and fully paid (Ordinary
Shares- Class A)
As at 1 January (GBP1 Ordinary Shares- Class
A) 68,000 68,000
As at period end (GBP0.001 Ordinary Shares-
Class A)* 68,000 68,000
=========
Authorised, allotted, issued, and fully paid (Ordinary
Shares - Class B)*
As at 1 January (GBP1 Ordinary Shares- Class
B) 10 10
As at period end (GBP0.5913044 Ordinary Shares-
Class B)* 10 10
As As
at at
30 31
June December
2023 2022
Ordinary Shares GBP'000 GBP'000
Total share capital - as at 1 January 68,010 68,010
Share capital reduction* (67,936) -
Total share capital - as at period end 74 68,010
*On 19 June 2023, in connection with the Pre-Admission
Reorganisation, the Company reduced the nominal value of the A
shares in the Company from GBP1 to GBP0.001 and the B shares in the
Company from GBP1 to GBP0.5913044. The effect of the share capital
reduction has been to reduce the share capital of the Company from
GBP68,010k to GBP74k and to increase retained earnings accordingly
(GBP67,936k).
There was no change to the number of shares authorised, issued,
and paid for during the period . There was no change to the voting
rights. There are no restrictions on the distribution of dividends
and the repayment of capital.
Refer to Note 29 for the impact of the group reorganisation on
the capital structure of the Company after reporting date.
21. RETAINED EARNINGS
As
at
31
December
As at
30 June 2022
2023
GBP'000 GBP'000
Balance at beginning of period 40,179 8,442
Profit for the period 13,578 31,001
Share capital reduction (Note 20) 67,936 -
Dividend paid* (11,300) -
Equity -settled share-based payments 978 388
Changes in NCI % (296) 348
Capital increase in subsidiary** 3,626 -
Balance
at
end
of
period 114,701 40,179
* The Company declared dividends to its shareholders amounting
to GBP11,300k in total, being GBP5,587k on 26 April 2023 and
GBP5,713k on 1 June 2023 (at 31 December 2022: nil). The dividend
per share was GBP0.08 in each case. CAB Tech Holdco Limited, a
subsidiary of the company, declared a dividend of GBP17,100k on 19
April 2023 (30 June 2022: nil) of which GBP1,540k was payable
externally to CAB Tech Holdco Limited minority shareholders.
**The Company's subsidiary, CTH, issued C and D shares to its
minority shareholders at a premium of GBP3,626k which increased the
equity attributable to owners of the group and the non-controlling
interest on 30 May 2023.
Equity classification of C and D shares held by NCI
We made the judgement based on the Articles of Association of
CAB Tech Holdco Ltd (CTH), adopted on 2 May 2023, that C and D
shares issued on 30 June 2023 by CAB Tech HoldCo qualify as equity
instruments. Contingent events that could give rise to a put or a
call over the shares issued by CTH are within our control and we
therefore have an unconditional right to avoid delivery of shares
in the CAB Payments Holdings plc or cash to CTH shareholders .
22. EARNINGS PER SHARE ("EPS")
The calculation of the basic and diluted earnings per share at
reporting date is based on the following data:
Six months ended 30 June
2023 2022
GBP'000 GBP'000
Earnings /(losses) attributable to owners of the Company:
Continuing operations 13,731 8,342
Discontinued operations (153) (95)
13,578 8,247
Weighted average number of ordinary shares
Six months ended 30 June
2023 2022**
'000 '000
Class A ordinary shares 68,000 68,000
Class B ordinary shares 5,913 5,913
* Class B ordinary shares at reporting date 10 10
* Class B share split post reporting date (Note 29) 5,903 5,903
Weighted average number of ordinary shares 73,913 73,913
Add effect of redesignation of shares and share split without change in resources subsequent
to period end
Redesignation of Class A and Class B ordinary shares post reporting date (Note 29) (73,913) (73,913)
Ordinary shares issued post reporting period* 221,739 221,739
* Redesignation of class A and class B shares into new
ordinary shares (Note 29) 73,913 73,913
* Additional new ordinary shares resulting from one for
three ordinary share split (Note 29) 147,826 147,826
Weighted average number of ordinary shares for basic and diluted EPS* 221,739 221,739
*In accordance with IAS 33 the redesignation of the of Class A
and Class B ordinary shares and the share split of the redesignated
shares post reporting date are reflected in the number of shares as
at the beginning of the periods presented. In line with
requirements of IAS 33, the shares issued to the minority
shareholders of CAB Tech Holdco Limited ("CTH") post reporting
date, have not been included.
**For comparability and consistent presentation, the weighted
average number of ordinary shares for 2022 was determined on the
same basis as the 2023 numbers .
Six months ended 30 June
2023 2022
pence pence
Basic and diluted earnings per share
C ontinuing operations 6.2 3.8
D iscontinued operations (0.1) (0.1)
Total basic and dilute EPS attributable to owners of the Company 6.1 3.7
As required by IAS 33, the earnings per share calculation takes
account of the share split which took place on 5 July 2023. The
resulting number of shares has been included in the comparative
calculation.
Due to the requirements of IAS 33, the required EPS calculation
is as above which, in the circumstances, bases the calculation on
the earnings available to the shareholders of the Company (ie
excluding the NCI portion) and the number of shares in issue post
Admission less those allocated to the NCI.
23. NON-CONTROLLING INTEREST (NCI)
The Group consists of a parent Company, CAB Payments Holdings
plc, incorporated in the UK and a number of subsidiaries held
directly and indirectly by Group, which operate and are
incorporated around the world. Note 25 below lists details of the
interests in subsidiaries.
Material non-controlling interests
Summarised financial statements in respect of the Group's
subsidiary, (CTH, which owns the entire share capital of CAB Tech
Holdco USA LLC, a US based holding Company, which itself owns
Segovia Technology Co) that has material non-controlling interests
is set out below. The summarised financial statement is shown
below.
A s at
3 0 June A s at
2023 3 1 December 2022
GBP'000 GBP'000
Assets 101,847 105,129
Liabilities 93,137 96,926
As at As at
30 June 30 June
2023 2022
GBP'000 GBP'000
Total income, net of interest expense attributable to owners of the Company 66,692 34,440
Total income, net of interest expense attributable to owners of the NCI 5,120 2,588
Profit attributable to owners of the Company 13,578 8,247
Profit attributable to the non-controlling interests 1,024 617
Profit for the period 14,602 8,864
Other comprehensive (loss)/income attributable to owners of the Company (128) 1 13
Other comprehensive (loss)/income attributable to the non-controlling interests (10) 9
Other comprehensive (loss)/ income for the p eriod (138) 1 22
Total comprehensive income attributable to owners of the Company 13,450 8,360
Total comprehensive income attributable to the non-controlling interests 1,014 626
Total comprehensive income for the period 14,464 8,986
Dividends paid to non-controlling interests 1,540 -
Net cash outflow from operating activities (4,460) (8,774)
Net cash outflow from investing activities (24) (145)
Net cash outflow from financing activities (666) (12)
The NCI % used in these financial statements was 7.13% (30 June
2022 - 6.99 %).
NCI Reconciliation As at As at
30 June 31 December
2023 2022
GBP'000 GBP'000
At b eginning of period 7,704 5,222
Total comprehensive income
attributable to non-controlling
interests 1,014 2,381
* Profit for the year attributable to non-controlling
interest 1,024 2,367
* Other comprehensive (loss)/gain (10) 14
Adjustment due to changes
in non-controlling interest
%* 296 69
Equity settled share based
payments 46 32
Dividends paid** (1,540) -
At period end 7,520 7,704
*CAB Tech Holdings Limited ("CTH"), a subsidiary of the Company,
issued C and D ordinary shares to external shareholders of the
Company on 26 May 2023.
** CTH declared a dividend of GBP17,100k on 19 April 2023 (30
June 2022: nil) of which GBP1,540k was payable externally to CAB
Tech Holdco Limited minority shareholders.
Uncertainty over Admission to Listing
Admission was uncertain as at 30 June 2023 and the decision over
whether or not to proceed with Admission was under the Board's
control. The decision to proceed with Admission was taken by the
Board on 5 July 2023. Accordingly judgment has been made that no
liability should be recognised in the interim consolidated
financial statements in respect of the delivery of a variable
number of shares of CAB Payments Holdings plc to the holders of the
Non-Controlling Interest (NCI), as the obligation was contingent
upon Admission, and that the NCI should be recognised as at 30 June
2023 because the risk and rewards of ownership of the shares held
by the NCI shareholders had not passed by 30 June 2023.
24. NOTES TO THE STATEMENT OF CASH FLOWS
Reconciliation of profit before taxation Six months ended
to net cash outflow from operating activities 30 June
2023 2022
GBP'000 GBP'000
Profit / (loss) before taxation 23,575 11,083
Continuing operations 23,794 11,199
Discontinued operations (219) (116)
Adjusted for non-cash items:
Effect of currency exchange rate changes (15,812) 42,371
Amortisation 2,402 2,503
Depreciation 636 566
- Property, plant and equipment 414 414
- Right of use of assets 222 152
Share based payment charge 1,024 418
Loss on disposal of property plant and
equipment 299 -
Profit on disposal of discontinued operations (68) -
Interest accrued on lease liabilities 34 7
Changes in working capital:
Net decrease in collections/transmissions - (1,900)
Net decrease/ (increase) in loans and advances
to banks other than on demand 11,125 (61,230)
Net (decrease)/ increase in customer accounts (1,736) 54,115
Net increase in investment in debt securities (36,370) (165,116)
Net decrease/(increase) in other loans
and advances to non-banks 7,058 (26)
Net (decrease)/increase in unsettled transactions (12,426) 10,429
Net decrease in other assets (3,809) 1,520
Net decrease in other liabilities 7,075 (15,993)
Net decrease/(increase) in accrued income 872 (110)
Decrease in accruals, provisions, and deferred
income (5,373) (1,338)
Net cash outflow from operating activities (21,494) (122,701)
25. RELATED PARTY TRANSACTIONS
Principal subsidiaries
The Company's principal direct and indirect subsidiaries as at
30 June 2023 are set out below. The Company is the majority
shareholder of CAB Tech HoldCo Ltd. Shares in other subsidiaries
are held as indicated. Unless otherwise stated, the share capital
consists solely of ordinary shares and the proportion of ownership
held equals the voting rights held by the parent. For all
subsidiaries, the country of incorporation or registration is also
the principal place of business.
Direct / Indirect Subsidiaries Principal Country of
activity Incorporation
/ and Principal
Business Place of Business
CAB Tech HoldCo Limited Holding Company UK
Crown Agents Bank Limited ("CAB") Bank UK
CAB Europe BV Payments Netherlands
Stichting CAB Payments Europe Trust company Netherlands
CAB Tech HoldCo USA LLC Holding Company US
Segovia Technology Co Fintech US
Segovia International Holdings LLC Holding Company US
Segovia Technology Pakistan (PVT.) Dormant Pakistan
Limited
Segovia Technology International Ltd. Holding Company Cayman Islands
Segovia Technology Congo SARL Fintech The Republic
of Congo
Segovia Technology Cote d'Ivoire SARL Fintech Ivory Coast
Segovia Technology Kenya Limited Fintech Kenya
Segovia Technology Liberia Corporation Fintech Liberia
Segovia Technology 454 Limited Dormant Malawi
Segovia Technology Nigeria Limited Fintech Nigeria
Segovia Technology Rwanda Corporation Fintech Rwanda
Limited
Segovia Technology Tanzania Company Fintech Tanzania
Limited
Segovia Technology Company Uganda Limited Fintech Uganda
Segovia Technology Bangladesh Ltd (dissolved Dissolved Bangladesh
January 2022)
Segovia Technology Cameroon Co Ltd Dissolved Cameroon
(dissolved March 2022)
Segovia Niger SARL (dissolved March Dissolved Niger
2022)
Segovia Technology Senegal Corp SUARL Dissolved Senegal
(dissolved January 2023)
All Segovia entities are held indirectly through CTH, which owns
the entire share capital of CAB Tech Holdco USA LLC, a US based
holding Company which owns Segovia. All UK subsidiaries are
incorporated in the UK with registered offices at Quadrant House,
The Quadrant, Sutton, Surrey SM2 5AS.
Refer to note 9 for assets classified as held for sale relating
to Crown Agents Investment Management Limited and JCF Nominees
Limited.
All subsidiaries are 100% group owned except for:
1. CAB Tech HoldCo Limited - 92.87% reducing over time to a
minimum of 90.67% depending on the exercise of share awards and the
vesting of shares. Following the group reorganisation on 6 July
2023 reported Note 29(i)(d) CAB Tech HoldCo Limited became a fully
owned subsidiary.
2. Segovia Technology Pakistan (PVT) Ltd - 66% owned by senior
management.
Holding Company
The immediate parent undertaking is Merlin Midco Limited as at
30 June 2023 (Note 29) owning 99% (at 31 December 2022: 99%) of the
Company. The address of its registered office is 13 Castle Street,
St Helier, Jersey, Channel Islands, JE4 5UT.
As at 30 June 2023, the ultimate parent undertaking and
controlling party is Helios Investors III LP, acting through its
general partner Helios Investors Genpar III LP. Helios Investors
Genpar III LP is registered in the Cayman Islands with its
registered office at PO Box 309GT, Ugland House, South Church
Street, Grand Cayman, Cayman Islands KY1-1104. Following the group
re-organisation which happened subsequent to reporting period,
there was no shareholder with majority control of the Group (see
Note 29(ii)).
The Group is a subsidiary of Helios Investors III LP, which is
not required to produce consolidated financial statements. The
Group's management believes that the absence of consolidated
financial statements of Helios III LP does not have a significant
impact on the Group's financial position, results or cash flows.
The Company's management is committed to providing investors with
accurate and transparent financial information. If the Helios III
LP group were to produce consolidated financial statements as at 30
June 2023, it would incorporate the group's financial information
into its consolidated financial statements.
The related party transactions (which were all at arm's length
and were transacted at market prices) are as follows:
A. As at 30 June 2023 the Group had one related party balance
with companies outside the Group (at 31 December 2022: two) as
follows:
(i) GBP97k (at 31 December 2022: GBP64k), to Helios Investors
Genpar III LP. The amount relates to the outstanding balance of a
director's fees payable by a Group Company, Crown Agents Bank
Limited. No interest accrues on the outstanding amount. Helios
Investors Genpar III LP had control or significant influence over
the Company as at 30 June 2023. Refer to Note 29(ii) for changes to
the shareholding structure.
(ii) Other loans and advances to non-banks include (at 30 June
2023:nil ; at 31 December 2022: GBP2,251k) receivable from Merlin
Topco Limited. The balance related to a contractual loan on which
interest accrues at a commercial rate. The balance was settled
during the period. Merlin Topco Limited is the parent company of
Merlin Midco Limited which has control or significant influence
over the Company as at 30 June 2023. Refer to Note 29 for changes
to the shareholding structure.
B. As at the period-end, 777,273 (at 31 December 2022: 771,328)
GBP0.001 Class A Ordinary Shares (at 31 December 2022: GBP1) of the
Company were owned by a company connected to a director of the
Company.
C. Group Company provided banking services to connected parties with income earned as follows:
30 June 2023 FX / Payments*** Correspondent
GBP'000 Banking** Total
GBP'000 GBP'000
Helios Investors Genpar III
LP* - 1 1
- 1 1
30 FX Correspondent Total
June / Banking** GBP'000
2022 Payments***
GBP'000
GBP'000
Helios
Investors
Genpar
III
LP* 2 - 2
2 - 2
* a company which had control or significant influence over the
Company as at 30 June 2023 before group reorganisation. (Note
29)
** FX / Payments relates to net foreign exchange gain and
correspondent banking relates to net interest income.
Note: the income on FX transactions is determined by margins on
the underlying currencies traded.
D. Interest in the shares of a subsidiary of the Company, CAB
Tech HoldCo Limited were owned by directors and key management of
certain Group Companies as follows:
CAB Tech HoldCo Limited - Number Of GBP1 Ordinary Shares
D Shares
As A2 A2 Restricted Restricted C
at Shares Share Shares Share Shares
30 Options (B Units
June Shares) (B
2023 Shares)
Director 1 662,325 - 157,808 - - -
Director 2 43,989 22,929 4,871 544,910 - -
Director 3 - - - - 1,410 4,500
Key Management Personnel
* Executive Committee member 1 - - - - 975
* Executive Committee member 2 - - - - 975
* Executive Committee member 3 - - - - 475
CAB Tech HoldCo Limited - Number Of GBP1 Ordinary Shares
As A2 A2 Restricted Restricted C D
at Shares Share Shares Share Shares Shares
31 Options (B Units
December Shares) (B
2022 Shares)
Director 1 662,325 - 157,808 - - -
Director 2 43,989 22,929 4,871 544,910 - -
The CAB Tech Holdco Limited C and D Shares were issued on 30 May
2023 as incentives to key directors and managers of Crown Agents
Bank Limited.
E. The Group had a number of loans to Directors and key management as summarised as shown below.
Staff loans
Across the Group there were loans outstanding at the period-end
as follows:
As at 30 As at 31
June 2023 December 2022
No GBP'000 No. GBP'000
Directors
As
at
1
Jan 4 494 3 159
As at period end 4 494 3 159
Key Management
As at 1 Jan 8 252 8 252
As at period end 8 252 8 252
Loans advanced prior to 2021 do not accrue interest. Loans
advanced from 2021 accrue interest at the HMRC stipulated rate but
only on balances in excess of GBP10,000. All loans are repayable on
the occurrence of the earliest of a number of events. There ECL for
staff loans was assessed as immaterial as at 30 June 2023.
F. Remuneration of key management personnel
The remuneration of the key management personnel of the Group is
set out below in aggregate for each of the categories specified in
IAS 24 Related Party Disclosures.
Six months ended 30 June
2023 2022
GBP'000 GBP'000
Short-term employee benefits 2,863 2,212
Post-employment benefits 55 142
Share-based
payments 393 108
Total
remuneration 3,311 2,462
G. Directors' remuneration
The remuneration of the Directors of the Group is set out below
in aggregate for each of the categories specified in IAS 24 Related
Party Disclosures.
Six months ended 30
June
2023 2022
GBP'000 GBP'000
Short-term employee benefits 2,875 1,927
Post-employment benefits 17 19
Share-based payments 144 79
Total remuneration 3,036 2,025
26. CLASSIFICATION OF FINANCIAL INSTRUMENTS
The carrying values of the financial assets and financial
liabilities are summarised by category below:
As at
As at 31 December
30 June 2022 (As
2023 restated)
GBP'000 GBP'000
Financial assets
Measured at fair value through profit
or loss
Money market funds 164,982 209,486
Derivative financial instruments - foreign
exchange related contracts 4,048 6,567
169,030 216,053
Measured at amortised cost
Cash and balances at central banks 577,572 607,358
Loans and advances on demand to banks 107,917 90,209
Other loans and advances to banks* 70,270 85,465
Other loans and advances to non-banks* 5,242 12,447
Investment in debt securities 432,534 414,061
Unsettled transactions 16,265 12,960
Accrued income 814 856
Other assets (excluding non-financial
assets) 7,810 8,353
1,218,424 1,231,709
Measured at fair value through other
comprehensive income
Investment in equity securities 473 488
*The prior year balance has been restated. Refer to Note 12 for
further details thereon.
As at As at
30 June 31 December
2023 2022
GBP'000 GBP'000
Financial liabilities
Measured at fair value through profit or
loss
Derivative financial instruments - foreign
exchange related contracts 8,023 4,543
8,023 4,543
Measured at amortised cost
Customer accounts 1,245,989 1,305,551
Unsettled transactions 16,661 25,782
Lease liability 1,113 1,281
Other liabilities (excluding non-financial
liabilities) 12,688 5,551
Accruals 14,926 19,364
1,291,377 1,357,529
27. FAIR VALUE MEASUREMENTS
Fair value methodology:
Fair value is the price that would be received to sell an asset
or paid to transfer a liability in an orderly transaction between
market participants at the measurement date. Where available fair
values are determined at prices quoted in active markets. In some
instances, such price information is not available for all
instruments and the Group applies valuation techniques to measure
such instruments. These valuation techniques make maximum use of
market observable data but in some cases, management estimate
unobservable market inputs within the valuation model. There is no
standard model and different assumptions would generate different
results. To provide an indication about the reliability of the
inputs used in determining fair value, the Group has classified its
financial instruments that are measured at fair value into the
three levels of fair value hierarchy explained further below, based
on the lowest level input that is significant to the entire
measurement of the instrument.
Fair value hierarchy:
Level 1 - Quoted prices (unadjusted) in active markets for
identical assets or liabilities
Inputs to level 1 fair value are quoted prices (unadjusted) in
active markets for identical assets. An active market is one in
which transactions for the asset occurs with sufficient frequency
and volume to provide pricing information on an on-going basis.
Level 2 - Inputs other than quoted prices included within Level
1 that are observable for the asset or liability, either directly
or indirectly
The fair value of financial instruments that are not traded in
an active market (for example, over-the-counter derivative
financial instruments) is determined using valuation techniques
which maximise the use of observable market data and rely as little
as possible on entity-specific estimates. If all significant inputs
required to fair value such an instrument are observable, the
instrument is included in level 2.
Fair values of derivative financial instruments (foreign
exchange contracts), money market funds, investment in equity
securities and investment in debt securities are included in level
2.
Money market funds and exchange traded funds are valued at fair
value based on the price a willing buyer would pay for the asset.
Any gain or loss is taken through the profit and loss account. The
money market funds include contractual terms such that they are
traded at par until the total market value of the underlying
instruments deviates from that par value by a certain amount
(typically 20bps). The funds have each traded at par at all times
since the initial investment by the Group.
The fair value of the Group's investment in debt securities is
determined by using discounted cash flow models that use market
interest rates as at the end of the period.
Level 3- Unobservable inputs for the asset or liability
Inputs to level 3 fair values are based on unobservable inputs
for the assets at the last measurement date. If all significant
inputs required to fair value an instrument are observable then the
instrument is included in level 2, if not it is included in level
3. The Group did not have any such instruments.
There were no transfers between fair value hierarchy level
during the period. There were no changes in valuation techniques
used during the period.
Financial assets and liabilities categorised at Level 2 fair
value hierarchy
Financial assets and financial Valuation techniques Inputs (including any significant
liabilities at fair value through unobservable inputs)
profit or loss
Derivative financial assets The Mark-to-Market ("MTM") Reuters quoted spot rates and forward
calculation for foreign currency points.
forwards is performed within
Core Banking System ("CBS") based on
market inputs pulled from Reuters at
the end of each
trading day.
CBS applies a straight-line
interpolation calculation to derive
the requisite forward points
for each currency based on the
maturity date of the transaction -
these points are added to
the spot rate to derive a revaluation
rate.
Money market funds Net asset value based on the valuation Quoted market prices but not for
of the underlying level 1 investments. identical assets.
Investment in equity securities Equity investment held in illiquid The fair value is calculated annually
security. In order to undertake its based on price received from Swift
business, the Group and is approved
utilises the Swift payment system, the annually at reporting period.
conditions of which oblige
participants to invest in
the shares of Swift, in proportion to
participants' financial contributions
to Swift.
Derivative financial liabilities The MTM calculation for FX Forwards is Reuters quoted spot rates and forward
performed within CBS based on market points.
inputs pulled
from Reuters at the end of each
trading day.
CBS applies a straight-line
interpolation calculation to derive
the requisite forward points
for each currency based on the
maturity date of the transaction -
these points are added to
the spot rate to derive a revaluation
rate.
Financial assets and financial liabilities at fair value through
profit or loss
Forward foreign exchange contracts have been transacted to
economically hedge assets and liabilities in foreign currencies
with movements recognised at fair value through profit or loss. Any
gain or loss is taken through the interim condensed consolidated
statement of profit or loss and other comprehensive income.
Fair values of financial assets that are measured at amortised
cost
Apart from the fixed rate bonds, the carrying amounts of
financial assets and liabilities measured at amortised cost are
approximately the same as their fair values due to their short-term
nature. The fair value of the fixed rate bonds is provided
below.
Financial liabilities measured at amortised cost
The carrying amounts of financial liabilities at amortised cost
are approximately the same as their fair values due to their
short-term nature.
The valuation levels of the financial assets and financial
liabilities accounted for at fair value are as follows:
Asset /(Liability) Type - as Level Level Level
at 30 June 2023 1 2 3
GBP'000 GBP'000 GBP'000
Financial assets at fair value
* Derivative financial assets - 4,048 -
* Money market funds - 164,982 -
* Investment in equity securities - 473 -
Financial liabilities at fair
value
* Derivative financial liabilities - (8,023) -
- 161,480 -
Asset /(Liability) Type - as Level Level Level
at 31 December 2022 1 2 3
GBP'000 GBP'000 GBP'000
Financial assets at fair value
- 6,567 -
* Derivative financial assets
- 209,486 -
* Money market funds
- 488 -
* Investment in equity securities
Financial liabilities at fair
value
- (4,543) -
* Derivative financial liabilities
- 211,998 -
These are all recurring fair value measurements. There were no
movements between fair value levels.
Fair value and carrying amount of investment in debt
securities.
As at 30 As at 31
June 2023 December 2022
GBP'000 GBP'000
Fair Fair
Carrying Value Value Carrying Value Value
Fixed rate bonds
* US Treasury Bills (excluding accrued interest) 18,546 15,495 66,207 65,636
- Other fixed rate bonds (excluding accrued interest) 411,172 406,976 345,321 341,889
Accrued interest 2,824 2,824 2,533 2,533
432,542 425,295 414,061 410,058
Note: The fair values of the fixed rate bond are based on market
quoted prices. They are classified as level 1 fair values in the
fair value hierarchy due to the liquid nature of the bond holdings,
having observable and transparent secondary market pricing.
28. CONTINGENT LIABILITIES AND COMMITMENTS
Contingent liabilities
The Group does not have contingent liabilities at the balance
sheet date other than those disclosed below:
Financial guarantee contracts
A financial guarantee contract is a contract that requires the
issuer to make specified payments to reimburse the holder for a
loss it incurs because a specified debtor fails to make payments
when due in accordance with the terms of a debt instrument. The
Group provides financial guarantees to multiple counterparties. The
maximum exposure for financial guarantee contracts is GBP23,100k
(at 31 December 2022: GBP4,000k). The Group received premiums of
GBP59k (at 30 June 2022: GBP59k)
Letter of credit confirmations / bill acceptances
Letter of credit confirmation / acceptance is a letter from an
issuing bank guaranteeing that a buyer's payment to a seller will
be received on time and for the correct amount. The Group confirmed
the letters of credit issued by an issuing bank and charged fixed
fees which are received either in advance or at a later date. The
Group provides these acceptances to multiple counterparties. The
maximum exposure for letters of credit confirmations is GBP96,000k
(at 31 December 2022: GBP38,000k). The Group received a premium of
GBP268k (at 30 June 2022: GBP302k).
The uncertainties relating to the amount or timing of any
outflow are those inherent within the products concerned, notably
that the relevant counterparty will not carry out its obligations.
Cash collateral of GBP47,845k (at 31 December 2022: GBP40,283k;)
was held by the Group in respect of the assets underlying financial
guarantees and letter of credits noted above. These are not
restricted cash and are available for use by the Group.
Liquidity as a service (LaaS) - undrawn commitments
Liquidity as a service is a credit facility offered by the Group
to its customers which allows customers to draw down on the
facility on satisfaction of the terms of this facility. The Group
charges a facility fee for consideration of providing this
facility. The Group provides this facility to multiple
counterparties. The maximum exposure for LaaS is GBP10,750k (at 31
December 2022: GBP4,721k). The Group received facility fees of
GBP26k (at 30 June 2022: GBP14k).
Commitments
Capital commitments
The Group does not have any capital commitments at the reporting
date (at 31 December 2022: nil).
Other commitments
In 2020, the Group entered into a five-year contract to assist
with the ongoing automation of manual processes.
The following payments are due under the contract:
Payment Due As at As at
30 June 31 December
2023 2022
GBP'000 GBP'000
Not later than one year 2,240 2,210
Later than one year and not later than five
years 3,013 4,143
5,253 6,353
The total of the amounts due under the contract are expensed to
interim condensed consolidated statement of profit or loss and
other comprehensive income over the life of the contract in line
with the benefits received. Further commitments are disclosed under
contingent liabilities.
There are no other commitments at the reporting date (at 31
December 2022: nil).
29. EVENTS AFTER THE REPORTING PERIOD
i. Group Reorganisation and Listing
The ordinary shares of the Company were admitted to the premium
listing segment of the Official List of the FCA and to trading on
the Main Market of the London Stock Exchange on 11 July 2023
("Admission").
Post 30 June 2023 but immediately prior to Admission, the Group
undertook certain steps as part of a reorganisation of its
corporate structure, which resulted in all shareholders of CAB Tech
Holdco Limited (other than the Company) exchanging shares in CAB
Tech Holdco Limited for Ordinary Shares in the Company (the
"Reorganisation").
On 4 July 2023, the Company was re-registered as a public
company limited by shares.
In relation to the existing share plans within the Group
structure prior to the share capital reorganisation and the Share
Exchange described below, and prior to Admission, any unvested
conditional awards and options vested in full after the reporting
date. Participants who held conditional awards received the CAB
Tech Holdco Limited shares subject to their awards and participants
who held options were given the opportunity to exercise their
options and acquire CAB Tech Holdco Limited shares in order to
participate in the Share Exchange.
The following steps relating to the Reorganisation took place
after the 30 June 2023 and immediately prior to Admission:
(a) the Company split the B ordinary shares into 5,913,044
Ordinary Shares with a nominal value of GBP0.001 each;
(b) the Company re-designated its existing A ordinary shares and
B ordinary shares into a single class of ordinary shares with a
nominal value of GBP0.001 each;
(c) the Company subdivided each ordinary share with a nominal
value of GBP0.001 each into three ordinary shares with a nominal
value of 0.0333 pence each.
Following steps (a) to (c) the Company's share capital comprised
221,739,135 ordinary shares.
(d) in accordance with the terms of the Implementation
Agreement, the Company acquired the shares held by the other
shareholders in CAB Tech Holdco Limited from each of CAB Tech
Holdco Limited's other shareholders in exchange for 32,404,083
newly issued Ordinary Shares(the "Share Exchange" ).
Accordingly at Admission 254,143,218 Ordinary Shares are in
issue.
ii. Holding company
Immediately following Admission, Merlin Midco Limited ownership
was reduced to 45.11% (at 31 December 2022: 98.8%) of the ordinary
shares of the company, which are held by a nominee company Diagonal
Nominees Limited on 12 September 2023.
iii. Relationship agreement
On the 26 June 2023, Helios Investors III, L.P. and Helios
Investors III (A), L.P. (together, the "Helios Funds"), each acting
by its general partner Helios Investors Genpar III, L.P., entered
into a relationship agreement with the Company (the "Relationship
Agreement"). As at 30 June, the Helios Funds were the ultimate
controllers of Merlin Midco Limited, the Principal Shareholder. The
general partner of the Helios Funds is advised by Helios Investment
Partners LLP in relation to the Helios Funds pursuant to the terms
of a typical investment advisory agreement. The Relationship
Agreement, for such time as the individual or combined
shareholdings of the Helios Funds are greater than or equal to 10%,
regulate the on-going relationship between the Company and the
Helios Funds following Admission. The Principal Shareholder was a
controlling shareholder of the Company for the purposes of the
Listing Rules. As required under the Listing Rules, the principal
purpose of the Relationship Agreement is to ensure that where the
Helios Funds' shareholding in the Company is greater than or equal
to 30%, the Company is capable of carrying on its business
independently of Helios and that transactions and arrangements with
the Helios Funds (including any transactions and arrangements with
any member of the Group) are conducted at arm's length and on
normal commercial terms. The Relationship Agreement is not subject
to any additional penalty or indemnity clauses.
iv. Long Term Incentive Plan
Immediately after Admission, a long term incentive plan was
implemented for executive directors, members of the Executive
Committee and other senior managers. The scheme involves share
awards (over a total of 3,321,536 Ordinary Shares) which vest in
relation to periods ending 31 December 2024 and 31 December 2025
with metrics depending on (i) earnings per share and (ii) total
shareholder returns relative to the FTSE 250 (excluding investment
trusts). Whilst the performance periods relate to the Company's
financial years, the awards will not vest until the second and
third anniversaries of the initial implementation date (11 July
2023).
There are no non-adjusting events after the reporting period
with the exception of the events noted above.
30. BOARD APPROVAL
The interim condensed consolidated financial statements for the
period ended 30 June 2023 were approved by the Board of Directors
and authorised for issue on 12 September 2023.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
IR SFIFUEEDSEIU
(END) Dow Jones Newswires
September 13, 2023 02:00 ET (06:00 GMT)
Cab Payments (LSE:CABP)
過去 株価チャート
から 5 2024 まで 6 2024
Cab Payments (LSE:CABP)
過去 株価チャート
から 6 2023 まで 6 2024
