TIDMREDC
RNS Number : 1009N
Red Capital PLC
21 September 2023
21 September 2023
RED CAPITAL PLC
Interim Report for the six months ended 30 June 2023
Red Capital Plc (LSE: REDC, "Red" or the "Company") announces
its unaudited condensed interim results for the six month period to
30 June 2023.
Strategy
Red was established in 2021 to undertake one or more investment
and / or acquisition opportunities of businesses operating within
the UK or internationally across certain sectors.
The Company retains a flexible investment and acquisition
strategy which will, subject to appropriate levels of due
diligence, enable it to deploy capital in target companies by way
of minority or majority investments, or full acquisitions where it
is in the interests of shareholders to do so.
The Company's strategic aim is to drive shareholder value
through the acquisition of target companies in certain sectors
where the Board believes there to be sustainable growth
opportunities both organically, and through acquisition. Sectors of
particular focus include business services and technology.
The Company is the parent company of Red Capital Subco Limited
(a private limited company under the laws of Jersey with registered
number 134741) and together will be referred to as the " Group " in
these accounts.
Results and developments in the six month period to 30 June
2023
The Group's loss after taxation was GBP100,961 (six month period
to 30 June 2022: loss of GBP96,510). This principally reflected
operating expenses incurred as a listed business of GBP103,333 (six
month period to 30 June 2022: GBP96,630).
The Group generated a loss per share of GBP0.01 (six month
period to 30 June 2022: loss per share of GBP0.01).
As a result of tight cost control and moderate operating
expenses, as at 30 June 2023, Red's cash balance was GBP489,186 (31
December 2022: GBP611,888).
On 20 June 2023, the Company held its Annual General Meeting in
which all resolutions were unanimously passed.
Risks
As the Company has yet to complete an investment or acquisition,
it has limited financial statements and / or historical financial
data, and limited trading history. As such, the Group and Company
during the period were subject to the risks and uncertainties
associated with an early-stage acquisition company.
The Directors are of the opinion that these risks, which were
detailed further in Red's published final results for the financial
year ended 31 December 2022, remain applicable to the Group and
Company.
Dividend
At this point in the Company's development, it does not
anticipate declaring any dividends in the foreseeable future.
Following the Company's inaugural investment or acquisition, the
Directors will determine an appropriate dividend policy for
Red.
Outlook
During the period, and post period end, Red has continued to
pursue its investment and acquisition strategy and is currently
assessing opportunities within its chosen sectors of interest.
These include successful businesses with the potential for high
growth that are seeking to partner with, and leverage the benefits
of, the Board's experience and that of the wider Red team. The
Directors look forward to updating shareholders in due course.
Statement of Directors' responsibilities
The Directors confirm that these condensed interim financial
statements have been prepared in accordance with UK adopted
International Accounting Standard 34, 'Interim Financial Reporting'
and the Disclosure Guidance and Transparency Rules sourcebook of
the United Kingdom's Financial Conduct Authority and that the
interim management report includes a fair review of the information
required by DTR 4.2.7 and DTR 4.2.8, 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
-- material related-party transactions in the first six months and any material changes in the related-party transactions described in the last annual report.
By order of the Board
David Williams
Chairman
20 September 2023
Enquiries :
Tessera Investment Management
Limited
Tony Morris +44 (0) 7742 189145
--------------------
INTERIM CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the six months ended 30 June 2023
Note Six months ended Six months ended
30 June 2023 30 June 2022
Unaudited Unaudited
GBP GBP
Administrative expenses (103,333) (96,630)
Operating loss (103,333) (96,630)
Interest receivable 5 2,372 120
Loss on ordinary activities before taxation (100,961) (96,510)
Taxation charge - -
Loss and total comprehensive loss for the period (100,961) (96,510)
================= =================
Loss per share
Basic & diluted 10 (GBP0.01) (GBP0.01)
========== ==========
Loss attributable to:
Owners of the parent company (100,961) (96,510)
The Group has no items of other comprehensive income in either
the current or prior period. All activities in both the current and
the prior period relate to continuing operations.
The accompanying notes form part of these interim condensed
consolidated financial statements.
INTERIM CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30 June 2023
Note As at As at
30 June 2023 31 December 2022
Unaudited Audited
GBP GBP
Current assets
Cash and cash equivalents 8 489,186 611,888
Trade and other receivables 7 8,997 9,947
Total current assets 498,183 621,835
Total assets 498,183 621,835
Current liabilities
Trade and other payables 9 30,086 53,561
Total current liabilities 30,086 53,561
Total liabilities 30,086 53,561
Total net assets 468,097 568,274
================ ==================
Equity
Share capital 12 100,000 100,000
Share premium 13 894,998 894,998
Capital redemption reserve 13 2 2
Share-based payment reserve 13 2,561 1,777
Retained deficit 13 (529,464) (428,503)
---------------- ------------------
Total equity attributable to equity holders of the Company 468,097 568,274
================ ==================
The accompanying notes form part of these interim condensed
consolidated financial statements.
INTERIM CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the six months ended 30 June 2022 (Unaudited)
Share-based
Capital payment
Share Share redemption reserve Retained Total
capital premium reserve GBP deficit Equity
GBP GBP GBP GBP GBP
Balance
as at 31
December
2021 100,000 894,998 2 210 (220,843) 774,367
Loss for
the period - - - - (96,510) (96,510)
Share-based
payment
charge - - - 784 - 784
---------- ---------- ------------- ------------ ----------- ---------
Balance
as at 30
June 2022 100,000 894,998 2 994 (317,353) 678,641
========== ========== ============= ============ =========== =========
For the six months ended 30 June 2023 (Unaudited)
Share-based
Capital payment
Share Share redemption reserve Retained Total
capital premium reserve GBP deficit Equity
GBP GBP GBP GBP GBP
Balance
as at 31
December
2022 100,000 894,998 2 1,777 (428,503) 568,274
Loss for
the period - - - - (100,961) (100,961)
Share-based
payment
charge - - - 784 - 784
---------- ---------- ------------- ------------ ----------- ----------
Balance
as at 30
June 2023 100,000 894,998 2 2,561 (529,464) 468,097
========== ========== ============= ============ =========== ==========
The accompanying notes form part of these interim condensed
consolidated financial statements.
INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS
For the six months ended 30 June 2023
Six months ended 30 June Six months ended 30 June
2023 2022
Unaudited Unaudited
GBP GBP
Cash flows from
operating activities
Loss before income tax (100,961) (96,510)
Adjustments for:
Share-based payment
charge 784 784
Interest receivable (2,372) (120)
Interest received 1,397 120
Operating cash flows
before changes in
working capital (101,152) (95,726)
Decrease/(increase) in
trade and other
receivables 1,925 (3,669)
Decrease in trade and
other payables (23,475) (20,177)
Net cash used in
operating activities (122,702) (119,572)
Cash and cash
equivalents at
beginning of period 611,888 829,065
Cash and cash
equivalents at end of
period 489,186 709,493
======================================== ====================================
The accompanying notes form part of these interim condensed
consolidated financial statements.
NOTES TO THE GROUP FINANCIAL INFORMATION
1. General information
The Company is a public limited company incorporated and
domiciled in Jersey, whose shares are publicly traded on the Main
Market of the London Stock Exchange. The Company is the parent
company of Red Capital Subco Limited (a private limited company
under the laws of Jersey with registered number 134741).
The address of its registered office is 28 Esplanade, St.
Helier, Channel Islands, JE2 3QA, Jersey.
The Group has been incorporated for the purpose of identifying
suitable acquisition opportunities in accordance with the Group's
investment and acquisition strategy with a view to creating
shareholder value. The Group will retain a flexible investment and
acquisition strategy which will, subject to appropriate levels of
due diligence, enable it to deploy capital in target companies by
way of minority or majority investments, or full acquisitions where
it is in the interests of shareholders to do so. This will include
transactions with target companies located in the UK and
internationally.
2. Basis of preparation
These interim condensed consolidated financial statements and
accompanying notes have neither been audited nor reviewed by the
Company's auditor.
The unaudited interim financial statements in this report have
been prepared using accounting policies consistent with
International Financial Reporting Standards ("IFRS") as adopted by
the UK. The accounting policies adopted in the interim financial
statements are consistent with those adopted in the Group's last
annual report for the year ended 31 December 2022 with regards to
the measurement and recognition of each type of asset, liability,
income and expense presented. The Group has not early adopted any
standard, interpretation or amendment that has been issued but is
not yet effective.
The interim condensed consolidated financial statements have
been prepared on a going concern basis.
The interim condensed consolidated financial statements do not
include all the information and disclosures required in the annual
financial statements and should be read in conjunction with the
Group's annual report as at 31 December 2022, which is available on
the Company's website.
These interim financial statements present selected explanatory
notes to explain events and transactions that are significant to an
understanding of the changes in the Group's financial position and
performance since 31 December 2022.
The interim condensed consolidated financial statements are
presented in GBP and rounded to the nearest GBP unless otherwise
stated.
These interim condensed consolidated financial statements were
approved by the Board of Directors on 20 September 2023.
Comparative figures
Comparative figures which have been presented cover the six
month period ended 30 June 2022. The statement of financial
position comparative figures are shown as at 31 December 2022.
Statutory accounts
Financial information contained in this document does not
constitute statutory accounts within the meaning of the Companies
(Jersey) Law 1991. The statutory accounts for the year ended 31
December 2022 have been filed with the Registrar of Companies. The
report of the auditors on those statutory accounts was unqualified
and did not draw attention to any matters by way of emphasis.
3. Significant accounting policies
The interim condensed consolidated financial statements are
based on the following policies which have been consistently
applied:
Basis of consolidation
The interim condensed consolidated financial statements present
the results of the Company and its subsidiaries (the "Group") as if
they formed a single entity. Intercompany transactions and balances
between Group companies are therefore eliminated in full.
Where the Group has control over a Company, it is classified as
a subsidiary. The Group controls a company if all three of the
following elements are present: power over the Company, exposure to
variable returns from the Company, and the ability of the Group to
use its power to affect those variable returns. Control is
reassessed whenever facts and circumstances indicate that there may
be a change in any of these elements of control.
The interim condensed consolidated financial statements
incorporate the results of business combinations using the
acquisition method. In the interim consolidated statement of
financial position, the acquiree's identifiable assets, liabilities
and contingent liabilities are initially recognised at their fair
values at the acquisition date. The acquisition related costs are
included in the consolidated statement of comprehensive income on
an accruals basis. The results of acquired operations are included
in the consolidated statement of comprehensive income from the date
on which control is obtained.
Functional and presentational currency
The Group's functional and presentational currency for these
financial statements is the pound sterling.
Interest receivable
Interest receivable is recognised on a time-proportion basis
using the effective interest rate method.
Employee benefits
Short-term employee benefit obligations are measured on an
undiscounted basis and are expensed as the related service is
provided. A liability is recognised for the amount expected to be
paid under short-term cash bonus or profit-sharing plans if the
Group has a present legal or constructive obligation to pay this
amount as a result of past service provided by the employee and the
obligation can be estimated reliably.
Cash and cash equivalents
Cash and cash equivalents comprise cash balances and short-term
deposits with an original maturity of three months or less from
inception, held for meeting short term commitments.
Equity
Equity comprises of share capital, share premium, capital
redemption reserve, share based payment reserve, and retained
deficit.
Share capital is measured at the par value.
Share premium and retained deficit represent balances
conventionally attributed to those descriptions. The transaction
costs relating to the issue of shares was deducted from share
premium.
The Capital redemption reserve is made up on amounts arising
from the cancellation of the deferred shares.
Share-based payment reserve includes the cumulative share-based
payment charged to equity.
Taxation
Tax on the profit or loss for the year comprises current and
deferred tax. Tax is recognised in the income statement except to
the extent that it relates to items recognised in other
comprehensive income or directly in equity, in which case it is
recognised in other comprehensive income or equity
respectively.
Current tax is the expected tax payable or receivable on the
taxable income or loss for the year, using tax rates and laws
enacted or substantively enacted at the statement of financial
position date.
Deferred tax is provided on temporary differences between the
carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for taxation purposes. The following
temporary differences are not provided for: the initial recognition
of goodwill; the initial recognition of assets or liabilities that
affect neither accounting nor taxable profit other than in a
business combination, and differences relating to investments in
subsidiaries to the extent that they will probably not reverse in
the foreseeable future. The amount of deferred tax provided is
based on the expected manner of realisation or settlement of the
carrying amount of assets and liabilities, using tax rates and laws
enacted or substantively enacted at the statement of financial
position date.
A deferred tax asset is recognised only to the extent that it is
probable that future taxable profits will be available against
which the temporary difference can be utilised.
Financial assets and liabilities
The Group's financial assets and liabilities comprise of cash
and cash equivalents, other receivables and accruals. Financial
assets are stated at amortised cost less provision for expected
credit losses. Financial liabilities are stated at amortised
cost.
Share-based payments
The Group operates an equity-settled share-based payment plan.
The fair value of the employee services received in exchange for
the grant of options is recognised as an expense over the vesting
period, based on the Group's estimate of awards that will
eventually vest, with a corresponding increase in equity as a
share-based payment reserve.
This plan includes market-based vesting conditions for which the
fair value at grant date reflects and are therefore not
subsequently revisited. The fair value is determined using a
binomial model.
Warrants
Warrants issued as part of share issues have been determined as
equity instruments under IAS 32. Since the fair value of the shares
issued at the same time as the warrants is equal to the price paid,
these warrants, by deduction, are considered to have been issued at
fair value. No warrants have been exercised in the period or
recognised in these interim consolidated financial statements. For
further details of the warrants issued please refer to the Group's
latest annual report at 31 December 2022.
Related party transactions
The Group discloses transactions with related parties which are
not wholly owned with the same group. It does not disclose
transactions with members of the same group that are wholly
owned.
Standards in issue but not yet effective
At the date of authorisation of these financial statements there
were amendments to standards which were in issue, but which were
not yet effective, and which have not been applied. The principal
ones were:
-- Amendment to IFRS 16 - Leases on sale and leaseback
transaction (effective for annual periods beginning on or after 1
January 2024)
-- Amendments to IAS 1, Presentation of financial statements on
classification of liabilities (effective date deferred until
accounting periods starting not earlier than 1 January 2024)
The Directors do not expect the adoption of these amendments to
standards to have a material impact on the financial
statements.
4. Critical accounting estimates and judgments
In preparing the interim condensed consolidated financial
statements, the Directors have to make judgments on how to apply
the Group's accounting policies and make estimates about the
future. The Directors do not consider there to be any critical
judgments that have been made in arriving at the amounts recognised
in the interim condensed consolidated financial statements.
5. Interest receivable
Six months ended Six months ended 30 June 2022
30 June 2023 Unaudited
Unaudited GBP
GBP
Bank interest receivable 2,372 120
============================ =========================================
6. Investments
Principal subsidiary undertakings of the Group
The Company directly owns the ordinary share capital of its
subsidiary undertakings as set out below:
Subsidiary Nature of business Country of Proportion of A Proportion of B
incorporation ordinary shares held ordinary shares held
by Company by Company
---------------------- ---------------------- ----------------------
Red Capital Subco Intermediate holding Jersey, Channel 100 per cent. 0 per cent.
Limited company Islands
---------------------- ---------------------- ---------------------- ---------------------- ----------------------
The address of the registered office of Red Capital Subco
Limited (the "Subco") is 28 Esplanade, St. Helier, Channel Islands,
JE2 3QA, Jersey. The Subco was incorporated on 31 March 2021 and
prepares its own financial statements for the period ended 31
December each year.
The A ordinary shares have full voting rights, full rights to
participate in a dividend and full rights to participate in a
distribution of capital. The B ordinary shares have been issued
pursuant to the Company's Subco Incentive Scheme and hold no voting
or dividend rights or rights to distribution.
7. Trade and other receivables
As at As at
30 June 2023 31 December 2022
Unaudited Audited
GBP GBP
Other receivables 975 -
Prepayments 8,022 9,947
Total 8,997 9,947
=========================== =============================
8. Cash and cash equivalents
As at As at
30 June 2023 31 December 2022
Unaudited Audited
GBP GBP
Cash at bank and in hand 489,186 611,888
========================= =============================
9. Trade and other payables
As at As at
30 June 2023 31 December 2022
Unaudited Audited
GBP GBP
Accruals 30,086 53,561
========================= =============================
10. Earnings per share
Six months Six months
ended ended
30 June 2023 30 June 2022
Unaudited Unaudited
GBP GBP
Loss attributable to the equity
holders of the Company (100,961) (96,510)
Weighted number of shares in issue 10,000,000 10,000,000
-------------- --------------
Loss per share (GBP) (0.01) (0.01)
============== ==============
11. Financial instruments
As at As at
30 June 2023 31 December
Unaudited 2022
GBP Audited
GBP
Financial assets
Cash and cash equivalents 489,186 611,888
Other receivables 975 -
Total 490,161 611,888
======================= ============================
As at As at
30 June 2023 31 December 2022
Unaudited Audited
GBP GBP
Financial liabilities
Accruals 30,086 53,561
============== ==================
Financial risk management objectives and policies
The Group's financial assets and liabilities comprise of cash
and cash equivalents, other receivables and accruals . The carrying
value of all financial assets and liabilities equals fair value
given their short-term nature.
Credit risk
The Group's credit risk is wholly attributable to its cash
balance. All cash balances are held at a reputable bank in Jersey.
The credit risk from its cash and cash equivalents is deemed to be
low due to the nature and size of the balances held.
Liquidity risk
Liquidity risk is the risk that the Group will not be able to
meet its financial obligations as they fall due.
The Group's approach to liquidity risk is to ensure that
sufficient liquidity is available to meet foreseeable requirements
and to invest funds securely and profitably.
12. Share capital
Allocated, called up and fully paid
As at As at As at As at
30 June 2023 30 June 2023 31 December 2022 31 December 2022
Unaudited Unaudited Audited Audited
Number GBP Number GBP
Ordinary shares of 1p each 10,000,000 100,000 10,000,000 100,000
============== ============== ================== ==================
13. Reserves
Share premium and retained deficit represent balances
conventionally attributed to those descriptions. The transaction
costs relating to the issue of shares was deducted from share
premium.
The Capital redemption reserve is made up on amounts arising
from the cancellation of the deferred shares.
Share-based payment reserve includes the cumulative share-based
payment charged to equity.
The Group having no regulatory or similar requirements, its
primary capital management focus is on maximising earnings per
share and therefore shareholder return.
14. Share incentive plan
On 12 November 2021, the Group created a Subco Incentive Scheme
within its wholly owned subsidiary Red Capital Subco Limited
("Subco"). Under the terms of the Subco Incentive Scheme, scheme
participants are only rewarded if a predetermined level of
shareholder value is created over a three to five year period or
upon a change of control of the Company or Subco (whichever occurs
first), calculated on a formula basis by reference to the growth in
market capitalisation of the Company, following adjustments for the
issue of any new Ordinary shares and taking into account dividends
and capital returns ("Shareholder Value"), realised by the exercise
by the beneficiaries of a put option in respect of their shares in
Subco and satisfied either in cash or by the issue of new ordinary
shares at the election of the Company.
Under these arrangements in place, participants are entitled to
up to 15 percent of the Shareholder Value created, subject to such
Shareholder Value having increased by at least 12.5 percent per
annum compounded over a period of between three and five years from
admission or following a change of control of the Company or
Subco.
15. Share-based payments
The Subco Incentive Scheme detailed in Note 14 is an
equity-settled share option plan which allows employees and
advisors of the Group to sell their B shares to the Company in
exchange for a cash payment or for shares in the Company (at the
Company's election) if certain conditions are met.
These conditions include good and bad leaver provisions and that
growth in Shareholder Value of 12.5 per cent. compound per annual
is delivered over a three to five year period for the scheme to
vest. This second condition is therefore a market condition which
has been taken into account in the measurement at grant date of the
fair value of the options.
The B share options have a weighted average contractual life of
3 years 4 months. No B share options were issued in the six months
ended 30 June 2023 and all B share options remained outstanding at
the period end. No B share options were exercised in the period.
The weighted average exercise price of the outstanding 110,000 B
share options is GBPNil.
The Group recognised GBP784 (six months ended 30 June 2022:
GBP784) of expenditure in the statement of total comprehensive
income in relation to equity-settled share-based payments in the
period.
The fair value of options granted during the period is
determined by applying a binominal model. The expense is
apportioned over the vesting period of the option and is based on
the number which are expected to vest and the fair value of these
options at the date of grant.
The inputs into the binomial model in respect of options granted
in the period are as follows:
Opening share price 10.0p
Expected volatility of share price 16.67%
Expected life of options 5 years
Risk-free rate 0.92%
Target increase in share price per annum 12.5%
Fair value of options 7.152p
Expected volatility was estimated by reference to the average
5-year volatility of the FTSE SmallCap Index.
The target increase in Shareholder Value is laid out in the
Articles of Association of the Subco and represents the compounded
target annual increase in market capitalisation (adjusted for
capital raises and dividends) that needs to be met between the
third and fifth anniversary of the Group's admission onto the Main
Market of the London Stock Exchange in order for the scheme to
vest.
The Group did not enter into any share-based payment
transactions with parties other than employees and advisors during
the current period.
16. Related party transactions
On 1 November 2021, the Company entered into an arm's length
strategic advisory agreement with Tessera Investment Management
Limited, a Company which is a shareholder in the Company, pursuant
to which Tessera has agreed to provide strategic and general
corporate advice, and acquisition and capital raising transaction
support services to the Company. Tessera was paid an initial
transaction success fee of GBP50,000 (plus VAT) on admission for
transaction management services provided to the Company in
connection with admission and capital raising activities.
From admission, Tessera continues to provide strategic advisory
services to the Company, including general corporate advice, and
acquisition and capital raising transaction support, and is
entitled to be paid a fixed monthly retainer fee of GBP5,000 (plus
VAT) per month payable in arrears. A discretionary transaction
success fee payable to Tessera may be agreed between the Company
and Tessera with such payment payable on successful completion of
an acquisition by the Company. As at 30 June 2023, Tessera was owed
GBPNil (31 December 2022: GBP6,243) by the Company.
17. Contingent liabilities
There are no contingent liabilities at the reporting date which
would have a material impact on the financial statements.
18. Events after the reporting date
There are no events subsequent to the reporting date which would
have a material impact on the financial statements.
19. Ultimate controlling party
In the opinion of the Directors, there is no single ultimate
controlling party.
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IR LMMBTMTATBIJ
(END) Dow Jones Newswires
September 21, 2023 02:00 ET (06:00 GMT)
Red Capital (LSE:REDC)
過去 株価チャート
から 4 2024 まで 5 2024
Red Capital (LSE:REDC)
過去 株価チャート
から 5 2023 まで 5 2024
