TIDMAIQ

RNS Number : 6405H

AIQ Limited

31 July 2023

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF EU REGULATION 596/2014, WHICH IS PART OF UK LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018.

31 July 2023

For Immediate Release

AIQ Limited

("AIQ" or the "Company" or, together with Alchemist Codes and Alcodes International, the "Group")

Interim Results

The Board of AIQ (LSE: AIQ) announces the Company's unaudited consolidated interim results for the six months ended 30 April 2023.

Summary

-- Completed a contract to supply a non-fungible token ("NFT") marketplace for education applications in Hong Kong

   --      Awarded a contract to supply a virtual data centre 
   --      Revenue for the six months ended 30 April 2023 was GBP73k (H1 2022: GBP361k) 
   --      Net loss for the period was GBP353k (H1 2022: GBP202k loss) 
   --      Cash and cash equivalents of GBP329k at 30 April 2023 (31 October 2022: GBP636K) 

Harry Chathli, Chairman of AIQ, said: " The first half results were in line with management's expectations and reflect the challenging market conditions and impact of the macro-economic climate on NFT and other blockchain-based projects. We completed the delivery of our project from last year and also commenced a new contract in the first half that was completed in the second half.

"At the time of the full year results earlier this year, we noted that we were continuing to receive interest, but that the revenues would be second half weighted. We remain hopeful of signing a new substantive contract in the second half of this year, but we do not expect full revenue recognition from this contract in this fiscal year. Consequently, we anticipate revenues for the full year 2023 to be substantially below that of last year. We continue to maintain tight cost control and lower our expenditure levels. We have vacated our premises in Malaysia and are consolidating our operations in Malaysia with those in Hong Kong thereby reducing our cost level by GBP100k on an annualised basis. We are pleased that our supportive shareholders have extended the deadline for repayment of their loan by 12 months from its due date in 2024. Additionally, the Board is keeping all its strategic options open should the markets not turn favourable in the short- to mid-term. "

Enquiries

 
 AIQ Limited                         c/o +44 (0)20 4 582 
                                                    3500 
 Harry Chathli, Chairman 
                                    -------------------- 
 
 Guild Financial Advisory Limited 
  (Financial Adviser)                 +44 (0) 7973839767 
                                    -------------------- 
 Ross Andrews 
                                    -------------------- 
 
 Gracechurch Group (Financial PR)    +44 (0)20 4582 3500 
                                    -------------------- 
 Claire Norbury 
                                    -------------------- 
 

Operational Review

During the six months to 30 April 2023, AIQ completed the delivery of a contract to supply an NFT platform. It has been built to enable art schools and education centres in Hong Kong assist their students in publishing NFTs on a blockchain platform. The Group performed the role of project manager and subcontracted the technical delivery (such that the net benefit to the Group is the margin earned on the contract).

Towards the end of the period, the Group was awarded a contract, by a new customer, to set up a virtual data centre. As with the NFT marketplace, the Group's role is project manager. The Group has delivered the initial phase of the project as planned. This comprised a feasibility study into building the data centre on three different non-cryptocurrency public blockchains, in accordance with the customer's requirements. Based on the findings of the feasibility study, the customer has decided to reevaluate its plans to build a virtual data centre. Accordingly, while the Group expects to be awarded further work from this customer under new contracts in due course, for this initial project the Group will now receive approximately 35% of the contract value announced on 27 March 2023.

During the period, the Board resolved to not renew the lease on its Malaysian office, which was due to expire in July 2023, and to formally close its Malaysian subsidiary, which is expected to occur by the end of the year. The Group's business has been primarily conducted from Hong Kong since the establishment of Alcodes International in Hong Kong and the divestment of the Group's Malaysia-based e-commerce business. Accordingly, the Group expects to recognise further cost savings of approximately GBP100k on an annualised basis by winding down its Malaysian operations.

Financial Review

Revenue for the six months ended 30 April 2023 was GBP73k (H1 2022: GBP361k). The revenue was primarily based on delivery under the data centre contract with a small proportion contributed by the NFT platform contract.

The Group recognised a gross profit of GBP71k (H1 2022: GBP115k), which reflects the lower revenues.

Administrative expenses were reduced to GBP286k (H1 2022: GBP392k) as the Group continued to implement cost reduction measures. However, this was offset by a net loss on foreign exchange of GBP121k (H1 2022: GBP70k gain) due to the weakening of the Pound against the Malaysian Ringgit and Hong Kong Dollar. Accordingly, operating loss was GBP337k (H1 2022: GBP207k loss).

Net finance costs were GBP16k compared with net finance income of GBP5k for the first half of the previous year. The increase in costs relates to the accrual of interest on the convertible loan notes that were issued during the previous year.

Loss before tax for the period was GBP353k (H1 2022: GBP202k loss) and the loss per share was 0.5 pence (H1 2022: 0.3 pence loss per share).

The Group had cash and cash equivalents of GBP329k at 30 April 2023 (31 October 2022: GBP 636k).

Outlook

The environment for NFT and other blockchain-based projects has remained challenging as a result of the impact of the macro-economic conditions as well as the volatility in the crypto markets. During the second half of the year, the Group completed delivery of the new contract won in the first half and continues to receive interest in its services and solutions. AIQ is hopeful of signing a new substantive contract in the second half, however, it does not expect full revenue recognition from this contract in the current fiscal year. Consequently, AIQ anticipates revenues for the full year 2023 to be substantially below that of last year.

The Group continues to maintain tight cost control and lower its expenditure levels. It has vacated its premises in Malaysia and is in the process of consolidating its operations in Malaysia with its operations in Hong Kong, which is expected to reduce costs by GBP100k on an annualised basis.

In H1 2023, the Group had cash outflows from operating activities of GBP353k and its cash position is approximately GBP200k at the date of this report. The Board continues to monitor the Group's cash position closely. It considers the Group to be a going concern, but, as set out in Note 2 to the financial statements, has identified a material uncertainty in this regard. The Board is pleased that, as also announced today, the Group's supportive shareholders have extended the deadline for the repayment of the convertible loan notes by 12 months from the due date in 2024. Additionally, the Board is keeping all its strategic options open should the markets not turn favourable in the short- to mid-term.

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

FOR THE SIX MONTHSED 30 APRIL 2023

 
 
 
                                                 Six months     Six months 
                                                      ended          ended     Year ended 
                                        Note       30 April       30 April     31 October 
                                                       2023           2022           2022 
                                                  Unaudited      Unaudited        Audited 
                                                        GBP            GBP            GBP 
 Revenue                                5            72,960        361,061        498,388 
 Cost of sales                                      (2,238)      (246,097)      (384,462) 
                                              -------------  -------------  ------------- 
 Gross profit/(loss)                                 70,722        114,964        113,926 
 
 Other income                                             -              -         12,202 
 
                                                                                (68 2,722 
 Administrative expenses                          (286,065)      (391,791)              ) 
 Impairment charge                      8                 -              -      (133,682) 
 (Loss)/gain on foreign 
  exchange                                        (121,208)         69,985        7 4,031 
 Operating loss                                   (336,551)      (206,842)      (616,245) 
 
 Finance income                                         102          9,184            273 
 Finance costs                                     (16,399)        (4,563)       (24,934) 
 Loss before taxation                             (352,848)      (202,221)      (640,906) 
 Taxation                                                 -              -              - 
                                              -------------  -------------  ------------- 
 Loss attributable to 
  equity holders of the 
  Company                                         (352,848)      (202,221)      (640,906) 
                                              =============  =============  ============= 
 
 Other comprehensive 
 income (as may be reclassified 
 to profit and loss in 
 subsequent periods, net 
 of taxes): 
 Exchange difference on 
 translating foreign operations                      80,045       (21,110)        (2,902) 
 
 Comprehensive income 
  attributable to equity 
  holders of the Company                         ( 272,803)     ( 223,331)     ( 643,808) 
                                              =============  =============  ============= 
 
 Earnings per share basic 
  and diluted (GBP)                     7           (0.005)        (0.003)        (0.010) 
 

The accompanying notes form an integral part of these consolidated financial statements

 
 CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION 
  AS AT 30 APRIL 2023 
                                           Note             As at         As at 
                                                           30 Apr        31 Oct 
                                                             2023          2022 
                                                        Unaudited       Audited 
                                                              GBP           GBP 
 Assets 
 
 Non-current assets 
 Property, plant and 
  equipment                                                10,881        12,270 
 Right of use assets                                       23,628        73,026 
 Rental deposits                                                -             - 
                                                 ----------------  ------------ 
                                                           34,509        85,296 
 
 Current assets 
 Trade and other receivables                              105,452        66,408 
 Cash and cash equivalents                                329,364       636,459 
                                                 ----------------  ------------ 
 Total current assets                                     434,816       702,867 
                                                 ----------------  ------------ 
 Total assets                                             469,325       788,163 
                                                 ----------------  ------------ 
 
   Equity and liabilities 
 Capital and reserves 
 Share capital                              10            647,607       647,607 
 Share premium                                          6,019,207     6,019,207 
 Share warrant reserve                      11             12,000        12,000 
 Foreign currency translation 
  reserve                                                  86,473         6,428 
 Accumulated losses                                   (6,984,154)   (6,631,306) 
                                                 ----------------  ------------ 
 Total equity                                           (218,867)        53,936 
                                                 ----------------  ------------ 
 
 Liabilities 
 Current liabilities 
 Trade payables                                             9,434             - 
 Accruals and other payables                              125,388       137,714 
 Lease restoration provision               9               27,750        18,500 
 Lease liabilities                                         25,620        78,013 
 Total current liabilities                                188,192       234,227 
                                                 ----------------  ------------ 
 
 Non-current liabilities 
 Convertible loan notes                     12            500,000       500,000 
                                                 ----------------  ------------ 
 Total non-current 
  liabilities                                             500,000       500,000 
                                                 ----------------  ------------ 
 Total equity and 
  liabilities                                             469,325       788,163 
                                                 ----------------  ------------ 
 
 

The accompanying notes form an integral part of these consolidated financial statements

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE SIX MONTHSED 30 APRIL 2023

 
                                                      Share        Foreign 
                                                    warrant       currency 
                               Share       Share    reserve    translation     Accumulated           Total 
                             capital     premium                   reserve          losses          equity 
                                 GBP         GBP        GBP            GBP             GBP             GBP 
 
 Balance as at 31                                                              ( 5,990,400 
  October 2021 (Audited)     647,607   6,019,207          -          9,330               )         685,744 
 Total comprehensive 
 loss for the 
 period                            -           -          -       (21,110)       (202,221)     (223,331) 
 Balance at 30 April 
  2022 (Unaudited)           647,607   6,019,207          -       (11,780)     (6,192,621)         462,413 
                          ==========  ==========  =========  =============  ==============  ============== 
 
 
 Balance as at 
  31 October 2022 
  (Audited)                  647,607   6,019,207     12,000          6,428     (6,631,306)          53,936 
                          ----------  ----------  ---------  -------------  --------------  ----------------- 
 Total comprehensive 
 loss for the                                                                    ( 352,848 
 period                            -           -          -         80,045               )     (272,803) 
 Share warrant 
  reserve                          -           -          -              -               -               - 
 Balance at 30 April 
  2023                       647,607   6,019,207     12,000         86,473     (6,984,154)       (218,867) 
                          ----------  ----------  ---------  -------------  --------------  -------------- 
 
 

Share premium - Represents amounts received in excess of the nominal value on the issue of share capital less any costs associated with the issue of shares.

Accumulated losses - The accumulated losses reserve includes all current and prior periods retained profits and losses.

Share warrant reserve - Amount arising on the issue of warrants during the period.

Translation reserve - The translation reserves includes foreign exchange movements on translating the overseas subsidiaries records, denominated MYR and HK$, to the presentational currency, GBP.

The accompanying notes form an integral part of these consolidated financial statements

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

FOR THE SIX MONTHSED 30 APRIL 2023

 
 
                                                Six months     Six months     Year ended 
                                                     ended          ended     31 October 
                                                  30 April       30 April           2022 
                                                      2023           2022 
                                                 Unaudited      Unaudited        Audited 
                                                       GBP            GBP            GBP 
 Cash flows from operating activities 
 Loss before taxation                            (352,848)      (202,221)      (640,906) 
 Adjustments for:- 
 Depreciation                                       50,218        117,383        123,272 
 Impairment charge                                       -              -        133,682 
 Loss on disposal of fixed assets                        -              -         10,467 
 Share based payment charge                        (6,000)              -          1,000 
 Write off tax receivable                                -              -         24,493 
 Lease restoration cost                              9,250              -         18,500 
 Interest income                                     (102)        (9,184)          (273) 
 Interest expense                                   16,399              -         24,934 
 Foreign exchange                                    1,482       (57,595)       (16,891) 
                                            --------------  -------------  ------------- 
 Operating loss before working 
  capital changes                                (281,601)      (151,617)      (321,722) 
 (Increase)/decrease in receivables               (33,957)       (34,886)        103,115 
 Decrease in payables                              (2,892)       (15,840)      (108,025) 
 Cash used in operations                         (318,450)      (211,459)      (326,632) 
 Interest received                                     102          9,184            273 
                                            --------------  -------------  ------------- 
 
   Net cash used in operating activities         (318,348)      (202,275)      (326,359) 
                                            --------------  -------------  ------------- 
 
 Cash flows from investing activities 
 Proceeds from sale of fixed assets                      -              -            512 
 
   Net cash used in investing activities                 -              -            512 
                                            --------------  -------------  ------------- 
 
 Cash flows from financing activities 
 Proceeds from issue of convertible 
  loan notes                                             -        500,000        500,000 
 Interest on lease liability                      (14,995)              -        (7,879) 
 Repayment of lease liabilities                   (52,393)       (55,862)       (91,476) 
 
   Net cash inflow/(outflow) in 
   financing activities                           (67,388)        444,138        400,645 
                                            --------------  -------------  ------------- 
 
   Net increase/(decrease) in cash 
   and cash equivalents                          (385,736)        241,863         74,798 
 Cash and cash equivalents at beginning 
  of the period                                    636,459        581,618        581,618 
 Effect of exchange rates on cash 
  and cash equivalents                              78,641         28,158       (19,957) 
 
   Cash and cash equivalents at 
   end of the period                               329,364        851,639        636,459 
                                            --------------  -------------  ------------- 
 
 
 

The non-cash movement from financing activities is GBP18,500 (2022: GBP5,555) on account of accrual of interest on loan notes GBP12,500 (refer to Note 13) and share-based payment charge GBP6,000 (refer to Note 12).

The accompanying notes form an integral part of these consolidated financial statements

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

1. GENERAL INFORMATION

AIQ Limited ("the Company") was incorporated and registered in The Cayman Islands as a private company limited by shares on 11 October 2017 under the Companies Law (as revised) of The Cayman Islands, with the name AIQ Limited, and registered number 327983.

The Company's registered office is located at 5th Floor Genesis Building, Genesis Close, PO Box 446, Cayman Islands, KY1-1106.

The Company has a standard listing on the London Stock Exchange.

The consolidated financial statements include the financial statements of the Company and its controlled subsidiaries (the "Group").

2. PRINCIPAL ACTIVITIES

The principal activity of the Company is to seek acquisition opportunities and to act as a holding company for a group of subsidiaries that are involved in the technology sector.

The Group is an information technology (IT) solutions provider, currently focused on the delivery of blockchain platforms in Asia through the provision of IT consultancy.

3. ACCOUNTING POLICIES

a) Basis of preparation

The condensed consolidated interim financial statements have been prepared in accordance with the Disclosure and Transparency Rules of the Financial Conduct Authority and International Accounting Standard 34 "Interim Financial Reporting" (IAS 34). Other than as noted below, the accounting policies applied by the Group in these condensed interim financial statements are the same as those set out in the Group's audited financial statements for the year ended 31 October 2021. These financial statements have been prepared under the historical cost convention and cover the six-month period to 30 April 2023.

These condensed financial statements do not include all of the information required for a complete set of IFRS financial statements. However, selected explanatory notes are included to explain events and transactions that are significant to an understanding of the changes in the Group's financial position and performance since the audited financial statements for the year ended 31 October 2022.

The condensed interim financial statements are unaudited and have not been reviewed by the auditors and were approved by the Board of Directors on 30 July 2023.

The financial information is presented in Pounds Sterling (GBP), which is the presentational currency of the Company.

A summary of the principal accounting policies of the Group are set out below.

b) Basis of consolidation

The consolidated financial statements incorporate the financial statements of the Company and its subsidiaries made up to the end of the reporting period. Subsidiaries are entities over which the Group has control. The Group controls an investee if the Group has power over the investee, exposure to variable returns from the investee, and the ability to use its power to affect those variable returns.

The consolidated financial statements present the results of the Company and its subsidiaries as if they formed a single entity. Inter-company balances and transactions between Group companies are therefore eliminated in full. The financial information of subsidiaries is included in the Group's financial statements from the date that control commences until the date that control ceases.

c) Going concern

The financial statements are required to be prepared on the going concern basis unless it is inappropriate to do so.

The Group incurred losses of GBP0.35 million during the period and cash outflows from operating activities of GBP0.32 million. As at 30 April 2023, the Group had net current assets of GBP0.25 million and cash of GBP0.33 million. The Group's cash position was approximately GBP200,000 at the date of this report.

The Group meets its day-to-day working capital requirements through cash generated from the capital it raised on admission to the London Stock Exchange, the issue of the convertible loan notes in the period (see note 10) and from the operations of its subsidiaries.

Notwithstanding these actions, a material uncertainty exists that may cast significant doubt on the Group's ability to continue as a going concern with the uncertainty of future trading performance giving rise to a material uncertainty over the going concern status of the Group. The Directors consider the Group to be a going concern but have identified a material uncertainty in this regard.

4. SUBSIDIARIES

The consolidated financial statements include the financial statements of the Company and its controlled subsidiaries (the "Group") as follows:

 
          Name               Place of         Registered address           Principal           Effective interest 
                           incorporation                                    activity 
                                                                                             30.04.2023   31.10.2022 
                         ----------------  -----------------------  ----------------------  -----------  ----------- 
                                            2-9, Jalan Puteri 
                                             4/8, Bandar 
                                             Puteri, 47100 
                                             Puchong, Selangor 
 Alchemist                                   Darul                   Design and 
  Codes Sdn                                  Ehsan                    development 
  Bhd                     Malaysia           Malaysia                 of software               100%        1 00% 
                         ----------------  -----------------------  ----------------------  -----------  ----------- 
                                            Room 47, Smart-Space 
                                             FinTech, Level 
                                             4, Core E, Cyberport 
 Alcodes International                       3, 100 Cyberport        Software 
  Limited*                Hong Kong          Road, Hong Kong          and app development       100%        1 00% 
                         ----------------  -----------------------  ----------------------  -----------  ----------- 
 

* Held by Alchemist Codes Sdn Bhd.

   5.       REVENUE 
 
                               Six months   Six months          Year 
                                    ended        ended         ended 
                                 30 April     30 April    31 October 
                                     2023         2022          2022 
                                      GBP          GBP             GBP 
 Sale of software products              -       19,052               - 
 Software development 
  income                           72,960      341,263         496,296 
 Merchant commission 
  income                                -          746             844 
 Other                                  -            -           1,248 
 Total                             72,960      361,061       498,388 
                              -----------  -----------  ------------ 
 
 

All revenues were generated in Asia. An analysis of revenue by the timing of the delivery of goods and services to customers for the periods ended 30 April 2023, 30 April 2022 and the year ended 31 October 2021 is as follows:

 
                                     30 April 2023          30 April 2023 
                                 Goods transferred   Services transferred 
                                     at a point in              over time 
                                              time 
                               -------------------  --------------------- 
                                               GBP                    GBP 
                               -------------------  --------------------- 
 Sale of software products                       -                      - 
                               -------------------  --------------------- 
 Software development income                     -                 72,960 
                               -------------------  --------------------- 
 Cashback income                                 -                      - 
                               -------------------  --------------------- 
 Other                                           -                      - 
                               -------------------  --------------------- 
 Total                                           -                 72,960 
                               -------------------  --------------------- 
 
 
                                    30 April 2022          30 April 2022 
                                Goods transferred   Services transferred 
                                    at a point in              over time 
                                             time 
                               ------------------  --------------------- 
                                              GBP                    GBP 
                               ------------------  --------------------- 
 Sale of software products                      -                      - 
                               ------------------  --------------------- 
 Software development income                    -                360,315 
                               ------------------  --------------------- 
 Cashback income                              746                      - 
                               ------------------  --------------------- 
 Other                                          -                      - 
                               ------------------  --------------------- 
 Total                                        746                360,315 
                               ------------------  --------------------- 
 
 
                                       31 October        31 October 2022 
                                             2022 
                                Goods transferred   Services transferred 
                                    at a point in              over time 
                                             time 
                               ------------------  --------------------- 
                                              GBP                    GBP 
                               ------------------  --------------------- 
 Sale of software products                      -                      - 
                               ------------------  --------------------- 
 Software development income                    -                496,296 
                               ------------------  --------------------- 
 Cashback income                                -                    844 
                               ------------------  --------------------- 
 Other                                         19                  1,229 
                               ------------------  --------------------- 
 Total                                         19                498,369 
                               ------------------  --------------------- 
 

6. SEGMENT REPORTING

IFRS 8 defines operating segments as those activities of an entity about which separate financial information is available and which are evaluated by the Board of Directors to assess performance and determine the allocation of resources. The Board of Directors is of the opinion that under IFRS 8 the Group has only one operating segment, the sale of software and ancillary services. The Board of Directors assesses the performance of the operating segment using financial information that is measured and presented in a manner consistent with that in the Financial Statements.

All revenues were derived from Asia.

7. LOSS PER SHARE

The Company presents basic and diluted earnings per share information for its ordinary shares. Basic loss per share is calculated by dividing the loss attributable to ordinary shareholders of the Company by the weighted average number of ordinary shares in issue during the reporting period. Diluted earnings per share are determined by adjusting the loss attributable to ordinary shareholders and the weighted average number of ordinary shares outstanding for the effects of all dilutive potential ordinary shares .

There is no difference between the basic and diluted earnings per share, as the warrants and loan notes are anti-dilutive in nature and therefore the diluted loss per share has not been presented.

 
 
                                                   Six months    Six months    Year ended 
                                                     ended 30      ended 30    31 October 
                                                   April 2023    April 2022          2022 
 
 Loss attributable to ordinary shareholders 
  (GBP)                                             (352,848)     (202,221)     (640,906) 
 Basic - Weighted average number 
  of shares                                        64,760,721    64,760,721    64,760,721 
 Basic earnings per share (expressed 
  as GBP per share)                                   (0.005)       (0.003)       (0.010) 
 
   8.       IMPAIRMENT CHARGE 

An impairment charge of GBP133,682 was made in the 2022 year-end accounts in respect of leasehold improvements and furniture and fixtures in the Group's Malaysian office bringing the value of those assets down to GBPnil on the basis that the lease would expire in July 2023.

   9.       LEASE RESTORATION PROVISION 
 
                       As at         As at 
                    30 April    31 October 
                        2023          2022 
                         GBP           GBP 
 Balance b/f          18,500             - 
 Addition              9,250        18,500 
                  ----------  ------------ 
 Balance c/f          27,750        18,500 
                  ----------  ------------ 
 

The Group has made a provision for the future costs of restoring its Malaysian office to its original specification as the lease expires in July 2023. Based on an estimation by management of the future expected costs of GBP37,000 to restore the premises to its original state, a further provision of 25% amounting to GBP9,250 has been provided in the period with the remaining GBP9,250 to be provided for in the second half of the year to 31 October 2023 as the Company does not intend to renew its lease.

   10.     SHARE CAPITAL 
 
                                          Number             Nominal 
                                                              value 
                                                               GBP 
  Authorised 
  Ordinary shares of GBP0.01 each         800,000,000           8,000,000 
                                    -----------------  ------------------ 
 
  Issued and fully paid: 
 
  As at 1 November 2022                    64,760,721             647,607 
  Issue of shares in the period                     -                   - 
 ---------------------------------  -----------------  ------------------ 
  At 30 April 2023                         64,760,721             647,607 
 ---------------------------------  -----------------  ------------------ 
 
                                     Six months ended            Year ended 
                                        30 April 2023           31 Oct 2022 
                                                  GBP                   GBP 
 As at beginning of the period                647,607               647,607 
 Issued during the period                           -                     - 
 As at end of the period                      647,607               647,607 
                                    -----------------  -------------------- 
 
 
   11.     SHARE WARRANT RESERVE 

On 3 October 2022 the Company granted 300,000 warrants to Guild Financial Advisory ("GFA"), the Company's corporate adviser, exercisable at a price of GBP0.01 for a period of up to ten years. The warrants were granted in return in part for their corporate financial services carried out for a period of 12 months whereby it was agreed that GFA would provide services for an amount of GBP24,000 with GBP12,000 being settled in cash and the balance of GBP12,000 represented by the issue of the warrants. As a result of this the fair value of the warrants is deemed to be GBP12,000 spread evenly over the 12-month period of the contract with GBP6,000 expensed for the six months to April 2023 and GBP5,000 carried forward as a prepaid expense while GBP12,000 was taken to a warrant reserve.

   12.     CONVERTIBLE LOAN NOTES 

On 24 January 2022, the Company entered into an unsecured convertible loan note agreement (the "Convertible Loan Note Facility") for a total subscription of GBP500,000 (the "Loan Notes").

Under the Convertible Loan Note Facility, the Loan Notes had an expiration date of 24 January 2024 ("Expiration Date") and can be repaid, in part or in full, by the Company on 31 December in any year prior to the Expiration Date by giving not less than 14 days' written notice to the noteholders. All outstanding Loan Notes attract interest at a rate of 5% per annum from the date of issue (24 January 2022) to the date of repayment or conversion.

The Loan Notes shall be convertible into new Ordinary Shares of the Company at the lesser of 11 pence per Ordinary Share or the Volume Weighted Average Price of the Company's Ordinary Shares on the London Stock Exchange in the seven-day period prior to the date on which the Loan Note is converted into Ordinary Shares. The Loan Notes shall be convertible, in part or in full, at any time from the date of issue until the Expiration Date by the noteholder giving to the Company at least one week's written notice.

As disclosed in Note 13, post period end, the Expiration Date of the Loan Notes was extended to 24 January 2025.

   13.     POST BALANCE SHEET EVENTS 

Post period end, as announced on 31 July 2023, the Company and the holders of the Loan Notes referred to in Note 12 above entered an agreement to extend the Expiration Date of the Loan Notes by 12 months to 24 January 2025. All other terms of the Convertible Loan Note Facility remain unchanged.

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END

IR BLGDRDBXDGXG

(END) Dow Jones Newswires

July 31, 2023 02:00 ET (06:00 GMT)

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