TIDMADVT
RNS Number : 8169S
Advancedadvt Limited
14 March 2023
AdvancedAdvT Limited
("AdvancedAdvT" or the "Company")
Unaudited Interim Results for the period ended 31 December
2022
The Company provides an update on the Company's cash and net
asset position as at 28 February 2023 and announces its unaudited
interim results for the six months ended 31 December 2022.
Overview and Chairperson's statement
Cash and Net Asset update as at 28 February 2023
-- Unaudited Net Asset Value (NAV) of 95.6 pence per share[1]
(91.4p at 31 December 2022[2])
-- Net assets of GBP127.3m(1) (GBP121.7m at 31 December 2022)
-- Interest-bearing cash of GBP103.4m (GBP103m at 31 December
2022)
Highlights
-- Strong position to execute on strategy given the opportunities
in current economic climate.
-- Net assets of GBP121.7m as at 31 December 2022 (GBP121.7m
at 30 June 2022)
-- Cash of GBP103m at 31 December 2022 (GBP104.2m at 30 June
2022)
-- Interest income from cash deposits largely offset operating
losses, most of which related to changes in fair value
of financial assets during the period
Chairperson's statement
The Company has remained focused on its objective of completing
a business combination with one or more businesses, by seeking and
actively evaluating high-quality targets.
The global economy has faced significant challenges, with
inflation, interest rate increases and heightened geopolitical
tensions creating headwinds in various markets. However, we also
recognise that such challenges also present opportunities for
businesses to adapt and become more resilient. By identifying and
capitalising on these opportunities, businesses can weather the
storm and come out stronger on the other side.
The Board believes the trend of increased data creation and
digitalisation of business processes and operations will continue
to present investment opportunities for high-quality businesses
with the potential to generate long-term value.
This continued acceleration of digital technologies has provided
an opportunity for businesses to deliver increased productivity,
address labour imbalances and gain a competitive advantage.
Furthermore, the convergence of technologies across fragmented
markets has the potential to bring about significant advancements
for customers.
With a strong cash position which exceeds GBP100m, we have a
clear advantage in against a backdrop of market uncertainty. Whilst
the cost of servicing debt and its availability have become major
challenges for other investment vehicles, our cash reserves offer a
unique, attractive alternative and positions us well to execute on
our strategy. This financial strength provides flexibility and the
resources to capitalise on opportunities, navigate the challenges
that may arise, as well as being an attractive proposition to
potential target businesses.
M&C Saatchi plc ("M&C")
We identified an opportunity to invest in an area of the market
which had the potential to deliver significant digital related
growth and opportunity. An initial investment, purchasing 9.82% of
the issued share capital of M&C, was followed up with an offer
to acquire the remainder of M&C. Despite some shareholder
support, we did not receive sufficient acceptances and the offer
lapsed on 30 September 2022.
This was a disappointing outcome given the 42.5% support from
M&C shareholders in our announcement on 17 May 2022. We
believed our offer was beneficial to all the Company's and M&C
stakeholders, introducing new cash to fuel accelerated growth and
investment.
As a significant shareholder in M&C, we will continue to
assess all potential value creation opportunities for M&C.
We would like to take this opportunity to thank our shareholders
for their continued support. We remain committed to acting with a
disciplined approach to deliver our objectives and create value for
our shareholders.
We remain optimistic about the future, and we look forward to
continuing to work together to navigate the opportunities
ahead.
Vin Murria OBE
Chairperson
13 March 2023
Enquiries:
Company Secretary 020 7004 2700
Antoinette Vanderpuije
Singer Capital Markets (Broker) 020 7496 3000
Phil Davies
George Tzimas
KK Advisory (Investor Relations) 07779 229508
Kam Bansil
Meare Consulting 07990 858548
Adrian Duffield
The Interim Report is also available on the 'Shareholder
Documents' page of the Company's website at www.advancedadvt.com
and the National Storage Mechanism at
https://data.fca.org.uk/#/nsm/nationalstoragemechanism.
Management Report
I present to shareholders the unaudited interim condensed
consolidated financial statements of AdvancedAdvT Limited
("AdvancedAdvT" or the "Company") for the six months ended 31
December 2022 (the "Consolidated Interim Financial Statements"),
consolidating the results of AdvancedAdvT and MAC I (BVI) Limited
(collectively, the "Group" or "MAC") .
Activity, Strategy & Outlook
The Company was formed with the goal of identifying
opportunities where a merger of management expertise, improved
operating performance, and a focused investment and M&A
strategy can unlock growth potential in core markets and
potentially expand into new territories and adjacent sectors. Our
objective is to generate attractive long-term returns for
shareholders by supporting sustainable growth, strategic
acquisitions and performance improvements within acquired
companies.
The management team has significant experience in the technology
sector, having invested in and/or operated a range of
high-performing software and digital services businesses. The
management team has a track record of successfully driving
operational excellence within these businesses to deliver organic
growth and has a history of executing targeted and accretive
M&A in the software sector, having completed more than 85
acquisitions collectively.
Over the last 25 years companies across all sectors have
increasingly adopted new digital technologies to optimise business
processes and operations. Implementing these new technologies has
become central to driving cost efficiencies and gaining a
competitive advantage in a digital world, where sectors and
businesses with the highest level of digitalisation display the
largest productivity growth.
Despite the opportunities presented by digitalisation,
pre-Covid-19 adoption of new technologies by businesses and
consumers was in part restricted by the reticence of companies to
invest in digital strategies and adopt new systems and
technologies. The global restrictions caused by Covid-19 have
helped to break down these barriers and forced businesses to become
more agile which has considerably accelerated digitalisation. The
resulting increase in demand and appetite to adopt new digital
technologies, alongside the continued momentum to move to the
cloud, has given rise to a squeeze on the labour market and digital
skills.
We therefore believe there is significant opportunity to invest
in companies that are positioned to take advantage of the
structural change arising from an unprecedented acceleration of
digitalisation brought about by the current macroeconomic
environment, affecting the way people live, work, and consume, and
the way businesses operate, engage, and sell to customers.
The Company may either consider acquiring total voting control
of any target company or business or acquiring a non-controlling
interest constituting less than total voting control or less than
the entire equity interest of that target company or business if
such opportunity is considered attractive or where the Company
expects to acquire sufficient influence to implement its strategy.
In such circumstances, the remaining ownership interest will be
held by third parties and the Company's decision-making authority
may be limited. Any third party's interests may be contrary to the
Company's interests.
Results
The Group's loss after taxation for the six months to 31
December 2022 was GBP113,010 (31 December 2021: loss after taxation
GBP218,548). The Group held cash and cash equivalents at 31
December 2022 of GBP 103,016,497 (31 December 2021:
GBP104,169,997).
Dividend Policy
The Company has not yet acquired a trading operation and it is
therefore inappropriate to make a statement on the likelihood of
any future dividends. The Directors intend to determine the
Company's dividend policy following completion of a platform
acquisition and, in any event, will only commence the payment of
dividends when it becomes commercially prudent to do so.
Corporate Governance
As a company with a Standard Listing, the Company is not
required to comply with the provisions of the UK Corporate
Governance Code. Nevertheless, the Board is committed to
maintaining high standards of corporate governance and will
consider whether to voluntarily adopt and comply with the UK
Corporate Governance Code as part of any acquisition, taking into
account the Company's size and status at that time.
The Company currently complies with the following principles of
the UK Corporate Governance Code:
-- The Company is led by an effective and entrepreneurial Board,
whose role is to promote the long-term sustainable success of the
Company, generating value for shareholders and contributing to
wider society.
-- The Board ensures that it has the policies, processes,
information, time and resources it needs in order to function
effectively and efficiently.
-- The Board ensures that the necessary resources are in place
for the company to meet its objectives and measure performance
against them.
Given the size and nature of the Company, the Board has not
established any committees and intends the Board as a whole would
make decisions. If the need should arise in the future, for example
following any acquisition, the Board may set up committees as
appropriate.
Risks
The Directors have carried out a robust assessment of the
principal risks facing the Company including those that would
threaten its business model, future performance, solvency, or
liquidity. The Company has published its principal risks in the
Company's prospectuses dated 4 December 2020, 18 March 2021 and 31
March 2022. The Directors are of the opinion that the risks
detailed in the Company's prospectus dated 31 March 2022 remain
applicable for the current financial year. The prospectus and
detailed risks can also be found on the Company's website
www.advancedadvt.com .
Responsibility Statement
Each of the Directors confirms that, to the best of their
knowledge:
(a) these Consolidated Interim Financial Statements, which have
been prepared in accordance with IAS 34 "Interim Financial
Reporting" as adopted by the European Union, give a true and fair
view of the assets, liabilities, financial position and profit or
loss of the Company; and
(b) these Consolidated Interim Financial Statements comply with
the requirements of DTR 4.2
Neither the Company nor the Directors accept any liability to
any person in relation to the interim financial report except to
the extent that such liability could arise under applicable
law.
Details on the Company's Board of Directors can be found on the
Company website at www.advancedadvt.com.
Vin Murria OBE
Chairperson
13 March 2023
Condensed Consolidated Statement of Comprehensive Income
Six months Six months
ended ended
31 December 31 December
2022 2021
Note Unaudited Unaudited
GBP GBP
Administrative expenses 2 (167,005) (237,894)
Fair Value on Financial Assets 5 (1,080,000) -
------------ ------------
Operating loss (1,247,005) (237,894)
Finance Income 1,133,995 19,346
------------ ------------
Loss before taxation (113,010) (218,548)
Taxation 3 - -
------------ ------------
Loss for the period (113,010) (218,548)
Total comprehensive loss for the period
attributable to owners of the parent (113,010) (218,548)
============ ============
Loss per ordinary share (GBP)
Basic 4 (0.00) (0.00)
Diluted 4 (0.00) (0.00)
The Group's activities derive from continuing operations.
Condensed Consolidated Statement of Financial Position
As at As at
31 December 30 June
2022 2022
Note Unaudited Audited
GBP GBP
Non-current assets
Financial asset at fair value through
profit or loss 5 18,120,000 19,200,000
------------ ------------
18,120,000 19,200,000
Current assets
Trade and other receivables 6 662,568 101,485
Cash and cash equivalents 7 103,016,497 104,169,997
Total current assets 103,679,065 104,271,482
Total assets 121,799,065 123,471,482
============ ============
Equity and liabilities
Equity
Sponsor share 2 2
Ordinary shares 131,166,131 131,166,131
Warrant reserve 98,000 98,000
Warrant cancellation reserve 350,000 350,000
Share-based payment reserve 353,135 305,104
Accumulated losses (10,374,418) (10,261,408)
------------ ------------
Total equity 121,592,850 121,657,829
Current liabilities
Trade and other payables 8 206,215 1,813,653
------------ ------------
Total liabilities 206,215 1,813,653
Total equity and liabilities 121,799,065 123,471,482
============ ============
Consolidated Statement of Changes in Equity
Notes Sponsor Ordinary Class Warrant Warrant Share Accumulated Total
share shares A shares reserves Cancellation based losses equity
GBP GBP GBP GBP Reserve payment GBP GBP
GBP reserve
GBP
Balance - - - - - - - -
as at 31
July 2020
Issuance
of 1 ordinary
share - 1 - - - - - 1
Redesignation
of 1 ordinary
share 1 (1) - - - - - -
Issuance
of 700,000
ordinary
shares and
warrants - 602,000 - 98,000 - - - 700,000
Share issue
costs - (275,300) - - - - - (275,300)
Issuance
of 2,500,000
Class A
shares and
warrants - - 2,150,000 350,000 - - - 2,500,000
Conversion
of 2,500,000
Class A
shares - 2,150,000 (2,150,000) (350,000) 350,000 - - -
Issuance
of 130,000,000
ordinary
shares - 130,000,000 - - - - - 130,000,000
Share issue
costs - (1,310,569) - - - - - (1,310,569)
Issuance
of 1 sponsor
share 1 - - - - - - 1
Total comprehensive
loss for
the period - - - - - - (2,546,025) (2,546,025)
Share-based
payment
expense - - - - - 209,250 - 209,250
Balance
as at 30
June 2021
(Audited) 2 131,166,131 - 98,000 350,000 209,250 (2,546,025) 129,277,358
Total comprehensive
loss for
the period - - - - - - (218,548) (218,548)
Share-based
payment
expense - - - - - 48,031 - 48,031
Balance
as at 31
December
2021 (Unaudited) 2 131,166,131 - 98,000 350,000 257,281 (2,764,573) 129,106,841
Total comprehensive
loss for
the period - - - - - - (7,496,835) (7,496,835)
Share-based
payment
expense - - - - - 47,823 - 47,823
Balance
as at 30
June 2022
(Audited) 2 131,166,131 - 98,000 350,000 305,104 (10,261,408) 121,657,829
Total comprehensive
loss for
the period - - - - - - (113,010) (113,010)
Share-based
payment
expense - - - - - 48,031 - 48,031
-------- ------------ ------------ ---------- ------------- --------- ----------------- ------------
Balance
as at 31
December
2022 (Unaudited) 2 131,166,131 - 98,000 350,000 353,135 (10,374,418) 121,592,850
-------- ------------ ------------ ---------- ------------- --------- ----------------- ------------
Consolidated Statement of Cash Flows
Six months Six months
ended ended
31 December 31 December
2022 2021
Note Unaudited Unaudited
----- ------------- -------------
GBP GBP
Operating activities
Loss for the period (113,010) (218,548)
Adjustments to reconcile total operating
loss to net cash flows:
Interest income (1,133,995) (19,346)
Fair Value adjustment on Investment 5 1,080,000 -
Add back share-based payment expense 2 48,031 48,031
Working capital adjustments:
(Increase)/decrease in trade and other
receivables and
Prepayments (288,426) 210,188
Decrease in trade and other payables (1,607,438) (32,728)
-------------
Net cash flows used in operating activities (2,014,838) (12,403)
------------- -------------
Financing activities
Interest income 861,339 19,346
------------- -------------
Net cash flows from financing activities 861,339 19,346
------------- -------------
Net (decrease)/increase in cash and
cash equivalents (1,153,499) 6,943
Cash and cash equivalents at the beginning
of the period 104,169,996 129,224,447
------------- -------------
Cash and cash equivalents at the end
of the period 7 103,016,497 129,231,390
============= =============
Notes to the Condensed Consolidated Financial Statements
1. SEGMENT INFORMATION
The Board of Directors is the Group's chief operating
decision-maker. As the Group has not yet acquired a trading
business, the Board of Directors considers the Group as a whole for
the purposes of assessing performance and allocating resources, and
therefore the Group has one reportable operating segment.
2. ADMINISTRATIVE EXPENSES BY NATURE
Six months Six months
ended 31 ended 31
December December
2022 2021
Unaudited Unaudited
GBP GBP
Group administrative expenses by nature
Directors' fees 112,021 111,340
Professional fees 74,056 32,396
Non-recurring project costs (103,982) (3,039)
Listing fees 24,140 44,288
Share based payment expense 48,031 48,031
Branding and website cost 11,262 3,637
Travel and entertainment 690 611
Bank charges 787 630
-----------
167,005 237,894
=========== ===========
3. TAXATION
Six months Six months
ended 31 ended 31
December December
2022 2021
Unaudited Unaudited
GBP GBP
Analysis of tax in period
Current tax for the period - -
----------- -----------
Total current tax - -
=========== ===========
The central management and control of the Group is exercised in
the UK and accordingly the Group is treated as tax resident in the
UK.
Reconciliation of effective rate and tax charge:
Six months Six months
ended 31 ended 31
December December
2022 2021
Unaudited Unaudited
GBP GBP
Loss on ordinary activities before tax (113,010) (218,548)
Expenses not deductible for tax purposes 1,128,102 48,031
-----------
Profit/(Loss) on ordinary activities subject
to corporation tax 1,015,092 (170,517)
Profit/(Loss) on ordinary activities multiplied
by the rate of corporation tax in the UK
of 19% 192,867 (32,398)
Tax Losses utilised (192,867) -
Effects of:
Losses carried forward for which no deferred
tax recognised - 32,398
-----------
Total taxation charge - -
=========== ===========
At 31 December 2022, cumulative tax losses available to carry
forward against future trading profits were GBP3,902,418 subject to
agreement with HM Revenue & Customs. Prior to an acquisition,
there is no certainty as to future profits and no deferred tax
asset is recognised in relation to these carried forward
losses.
4. LOSS PER ORDINARY SHARE
Basic EPS is calculated by dividing the profit/(loss)
attributable to equity holders of a company by the weighted average
number of ordinary shares in issue during the year. Diluted EPS is
calculated by adjusting the weighted average number of ordinary
shares outstanding to assume conversion of all dilutive potential
ordinary shares.
The Company has issued 700,000 warrants, each of which is
convertible into one ordinary share. The Group made a loss in the
current period, which would result in the warrants being
anti-dilutive. Therefore, the warrants have not been included in
the calculation of diluted earnings per share.
The Company has issued two sponsor shares, the sponsor shares
have no right to receive distributions and so have been ignored for
the purposes of IAS 33.
Six months Six months
ended 31 ended 31
December December
2022 2021
Unaudited Unaudited
Loss attributable to owners of the parent (113,010) (218,548)
Weighted average number of ordinary shares
in issue 133,200,000 133,200,000
Weighted average number of ordinary shares
for diluted EPS 133,200,000 133,200,000
Basic and diluted loss per ordinary share
(GBP's) 0.00 0.00
5. INVESTMENTS
Principal subsidiary undertakings of the Group
The Company owns directly the whole of the issued ordinary share
capital of its subsidiary undertaking. Details of the Company's
subsidiary are presented below:
Proportion Proportion
of ordinary of ordinary
Nature of Country shares held shares held
Subsidiary business of incorporation by parent by the Group
--------------------- ------------ ------------------- ------------- --------------
Incentive
MAC I (BVI) Limited vehicle BVI 100% 100%
The registered office of MAC I (BVI) Limited Commerce House,
Wickhams Cay 1, P.O. Box 3140, Road Town, Tortola, British Virgin
Islands VG1110.
Financial assets of the Company
The Company directly owns equity investments for which the
Company has not elected to recognise fair value gains and losses
through Other Comprehensive Income.
As at 31 As at 30
December June 2022
2022 Audited
Unaudited
GBP GBP
Level 1 Financial assets at fair value through
profit or loss (FVTPL) 18,120,000 19,200,000
18,120,000 19,200,000
=========== ===========
There were no transfers between levels for fair value
measurements during the year. The Company's policy is to recognise
transfers into and out of fair value hierarchy levels as at the end
of the reporting period.
a) Level 1: The fair value of financial instruments traded in
active markets (such as publicly traded derivatives, and equity
securities) is based on quoted market prices at the end of the
reporting period. The quoted market price used for financial assets
held by the Company is the current bid price. These instruments are
included in level 1.
b) Level 2: The fair value of financial instruments that are not
traded in an active market (e.g. over-the counter derivatives) is
determined using valuation techniques that 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 an instrument are observable, the instrument is included
in level 2.
c) Level 3: If one or more of the significant inputs is not
based on observable market data, the instrument is included in
level 3. This is the case for unlisted equity securities. During
the year, the following gains/(losses) were recognised in profit or
loss:
Six months Six months
ended 31 ended 31
December December
2022 2021
Unaudited Unaudited
GBP GBP
Fair value (losses) on equity investments
at FVTPL recognised in the profit or loss (1,080,000) -
(1,080,000) -
============ ===========
6. TRADE AND OTHER RECEIVABLES
As at 31 As at 30
December June 2022
2022 Audited
Unaudited
GBP GBP
Amounts receivable in one year:
Prepayments 20,553 11,271
Other receivables 272,660 65,488
VAT receivable 369,355 24,726
----------- -----------
662,568 101,485
=========== ===========
There is no material difference between the book value and the
fair value of the receivables. Receivables are considered to be
past due once they have passed their contracted due date.
7. CASH AND CASH EQUIVALENTS
As at 31 As at 30
December June
2022 2022
Unaudited Audited
GBP GBP
Cash and cash equivalents
Cash at bank 20,114,984 64,169,997
Deposits on call 82,901,513 40,000,000
------------ ------------
103,016,497 104,169,997
============ ============
Credit risk is managed on a Group basis. Credit risk arises from
cash and cash equivalents and deposits with banks and financial
institutions. For banks and financial institutions, only
independently rated parties with a minimum short-term credit rating
of P-1, as issued by Moody's, are accepted.
8. TRADE AND OTHER PAYABLES
As at 31 As at 30
December June
2022 2022
Unaudited Audited
GBP GBP
Amounts falling due within one year:
Trade payables 1,725 125,768
Accruals 88,646 1,572,041
A ordinary share liability 115,844 115,844
-----------
206,215 1,813,653
=========== ==========
There is no material difference between the book value and the
fair value of the trade and other payables.
9. FINANCIAL INSTRUMENTS AND ASSOCIATED RISKS
The Group has the following categories of financial instruments
at the period end:
As at 31 As at 30
December June
2022 2022
Unaudited Audited
GBP GBP
Financial assets measured at amortised
cost
Cash and cash equivalents 103,016,497 104,169,997
Other receivables 272,660 65,488
Financial assets at fair value through
profit or loss (FVTPL) 18,120,000 19,200,000
------------ ------------
121,409,157 123,435,485
------------ ------------
Financial liabilities measured at amortised
cost
Trade and other payables 206,215 1,813,653
------------ ------------
206,215 1,813,653
============ ============
The fair value and book value of the financial assets and
liabilities are materially equivalent.
As the Group's assets are predominantly cash and cash
equivalents, market risk and liquidity risk are not currently
considered to be material risks to the Group. There have been no
changes to the Group's risk management policies or treasury
management since 30 June 2022
10. RELATED PARTY TRANSACTIONS
Antoinette Vanderpuije, the Company Secretary is a partner of
Marwyn Investment Management LLP ("MIMLLP"). MIMLLP manages MVI II
Holdings I LP which is beneficially owned by Marwyn Value Investors
II LP. MVI II Holdings I LP holds 15.41 per cent of the Company's
ordinary shares and 1 Sponsor Share.
Antoinette Vanderpuije has a beneficial interest in the
Incentive Shares her indirect interest in MLTI which owns 2,000 A2
ordinary shares in the capital of MAC I (BVI) Limited.
Antoinette Vanderpuije is also a partner of Marwyn Capital LLP
("MCLLP"). MCLLP provides corporate finance, company secretarial
and managed service support to the Company. The Company has
incurred fees of GBP8,788 in respect of company secretarial and
managed service support and GBP125,000 for services to the Company
in regard to Project Maltesers. MCLLP incurred costs of GBP5,648,
which it recharged the Company during the period.
11. COMMITMENTS AND CONTINGENT LIABILITIES
There were no commitments or contingent liabilities outstanding
at 31 December 2022 that requires disclosure or adjustment in these
financial statements.
12. POST BALANCE SHEET EVENTS
No other matter or circumstance has arisen since 31 December
2022 that has significantly affected, or may significantly affect
the consolidated entity's operations, the results of those
operations, or the consolidated entity's state of affairs in future
financial years.
[1] NAV per share estimated using 10 day VWAP price of 194p for
the M&C Saatchi shares held as a Financial asset at fair value
through profit or loss
[2] NAV per share estimated using 10 day VWAP price of 152p for
the M&C Saatchi shares held as a Financial asset at fair value
through profit or loss
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IR VXLFFXXLEBBE
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