TIDMATQT
RNS Number : 5542H
ATTRAQT Group PLC
07 April 2022
7 April 2022
Attraqt Group plc
("Attraqt", the "Group" or the "Company")
Full Year Results and Update on Current Trading
Continued strategic progress with traction building in the
Mid-Market
Strong sales and pipeline in Q1 FY22
Attraqt Group plc (AIM: ATQT), the leading provider of product
discovery solutions for ecommerce, is pleased to announce its final
results for the twelve months ended 31 December 2021.
Financial Highlights:
-- Revenue up 9% to GBP22.9m (2020: GBP21.0m). GBP23.1m at constant currency
-- Gross margin of 71% (2020: 74%) impacted by a small number of
legacy XO contracts having higher hosting costs which we have been
unable to pass on to customers.
-- SaaS revenue up 8% to GBP20.9m (2020: GBP19.3m)
o SaaS gross margin of 77% (2020: 80%)
-- Services revenue up by 16% to GBP2.0m (2020: GBP1.7m)
o Services gross margin flat at 9% (2020: 9%)
-- Adjusted EBITDA(1) of GBP0.7m (2020: GBP1.1m) reflecting
investment in the product and go to market teams during the
year.
-- Statutory loss after tax of GBP3.5m (2020: GBP2.2m loss)
-- Basic EPS loss of 1.8p (2020: 1.2p loss)
-- Cash at period end of GBP3.5m (2020: GBP6.6m), flat on 30
June 2021 position due to lengthening lead times on Enterprise
sales seen in H2, capitalised development expenditure of GBP2.0m,
the payment of deferred consideration on acquisitions of GBP0.8m
and the payment of delayed Covid tax liabilities of GBP0.5m
-- Continuing on its current trajectory, the Company is on track to be cash neutral in 2022
KPIs :
-- 80% of top 20 customers on multi-year contracts and 35
multi-year renewals signed during the year (2020: 38)
-- Exit annual recurring revenue ("ARR") up 4% to GBP21.9m
(2020: GBP21.1m), 7% at constant currency (GBP22.6m)
-- GBP1.4m worth of new logos (2020: GBP1.7m)
-- New bookings in the period of GBP4.4m (2020: GBP4.6m),
including several clients with good future roll-out potential such
as a multinational athletic brand Puma, an international home &
fashion retailer and an international beauty product leader
-- Net revenue retention rate of 104% (2020: 98%)
-- Continued strength in Net Promoter Score at 25 (2020: 29)
Operational highlights:
-- Partnership strategy has developed significantly and
delivered good results, with over 35% of Mid-Market lead flow now
coming via partners
-- Continued investment in product development and innovation;
successfully embedding the core of the AI search function, building
on common components between Fredhopper and XO, and continuing the
ecommerce connectivity platform programme.
-- Launched a new user interface refresh of Fredhopper
-- Strength of platform shown with systems recording c.100%
availability through the peak trading around Thanksgiving, Cyber
Monday and the Christmas trading period.
Q1 update:
-- GBP0.7m of new logos signed post-period end in Q1 FY22 (vs
GBP0.3m Q1 FY21) demonstrating building momentum.
-- Total New bookings in Q1 FY22 of GBP1.5m (up 15% Q1 FY21)
including a large Enterprise win with a global fashion retailer
-- 9 Mid-Market deals signed in the quarter representing a
significant improvement on previous quarter
-- One third of our Mid-Market ARR was sourced by our partners
-- Almost GBP500k of Enterprise ARR signed in the quarter
-- Strong pipeline of Enterprise opportunities with a 6x gross coverage on our Q2 target.
Mark Adams, Chief Executive Officer of Attraqt Group,
commented:
"Despite having to once again navigate a turbulent year, I am
pleased with the momentum that has been building across the
business and is delivering on our expectations. We now have two
innovative products, each specifically tailored to its market
segment and with a refined go-to-market strategy. Additionally, our
partnership strategy is providing us with significant new business
lead flow in both the Mid-Market and Enterprise segments.
While a trend for lengthening lead times in the Enterprise
market segment impacted H2, we are pleased to have seen several of
these deals close in Q1 of 2022, including one large win with a
global fashion retailer and another where we have been awarded
preferred vendor status that is due to close in mid Q2. In the
Mid-Market segment, the foundations that were built throughout
FY21, crafting our offering and building a targeted team, are
beginning to come to fruition with increasing sales momentum, with
the same number of Mid-Market logos signed in the first quarter of
2022 compared to both Q3 and Q4 2021 combined.
As we look forward, we will continue to build our reach in the
Mid-Market, as well as building on our strong position in
Enterprise with our much more competitive offering. In order to
ensure our technology remains market-leading, we will continue
innovating with a particular focus on visual search, search
personalisation and semantic tagging, all underpinned by our
recently acquired AI technologies. As a result of the progress made
over the year, we are well positioned to deliver on our growth
strategy through great product, great people and with much improved
execution of our strategic goals."
A video overview of the results from the CEO, Mark Adams is
available to watch here:
https://bit.ly/ATQT_Full_Year_2021_overview
For further enquiries please contact:
+44 (0)7747 766
Attraqt Group plc 849
Eric Dodd, CFO
Canaccord Genuity +44 (0)20 7523 8000
Simon Bridges
Adam James
Thomas Diehl
Alma PR +44 (0)20 3405 0205
Susie Hudson attraqt@almapr.co.uk
Sam Modlin
Rebecca Sanders-Hewett
Ella Doran
About Attraqt Group plc
Attraqt enables online retailers and brand owners to maximise
the performance and potential of their e-commerce investments by
enabling best in class product discovery experiences. The Company
delivers omnichannel search, merchandising, and product &
content personalization for online retailers and brands. Our vision
is to be the number one team and growth engine for our customers;
powering the world's best product discovery experiences, wherever
and whenever they happen.
For more information visit www.attraqt.com
Chairman's Statement
Prior to joining the business, I could see that Attraqt's
offering is extremely relevant in the current market environment,
and the business had the capability of being a true leader in its
market. I am pleased to say that this really has been illustrated
to me in my first six months as Chairman. The Group has achieved a
lot this year, but in my mind, what defines it, is the sharpening
of our strategy and raising of our ambition.
After a few years of investing in our product, whether through
acquisition or internally, we are now at the point that we are
driving our sales and marketing teams with a strong and effective
product set. The result of this is really coming into fruition and
can be seen in the increased strength of our pipeline, now
beginning to convert, with strong Q1 2022 sales.
This doesn't mean we have, or will, sit still with our product
development, as that is what our customers and wider industry
demands. Our innovation will continue as we evolve with the needs
of our end markets at the forefront of our thinking. A crucial
milestone on this journey was the addition of our AI Search
function, through our acquisition of Aleph, which we are pleased to
say has built on our product proposition. We are now moving beyond
upselling this on its own and are implementing its core AI
functionality across multiple different products as part of our
development roadmap.
As well as now having a strong product offering, our solutions
remain incredibly robust and able to support the exceptional levels
of throughput we have seen. Our technology handled up to 9,000
requests a second at peak trading (during Grey Thursday) and for
our sixth year running, we were proud to achieve 100% uptime to
support our global customers when they need us most. This
demonstrates the scalability and reliability of our product
offering.
The strategic pillars that drive our business forward have
really begun to prove themselves in this period itself. A key
strategic focus for the Group in the year was to build out a
partnership strategy, pleasingly we have made considerable progress
in this area. Partnerships, like the award winning engagement and
integration with BigCommerce, significantly increase our target
addressable market and have enabled us to win incremental business
away from our competitors. This partner programme will allow us to
scale in the Mid-Market and is truly bringing huge benefit for the
Group.
Pleasingly, following a further 35 multi-year contract renewals
in the period, 80% of the Group's top 20 customers are now signed
up to multi-year contracts. This commitment from some of the
world's leading brands is testament to the strength of Attraqt's
relationships, quality of revenue and the relevance of our product
offering.
A clear demonstration of our progress on customer success,
operational excellence and product innovation is our net revenue
retention, which now stands at an impressive 104%. It is clear the
investments across the business are now paying off.
Whilst the strength of the Group's pipeline reflects our new
go-to-market model, there is no doubt that Enterprise sales cycles
have remained longer than pre pandemic as retailers and brands have
had to manage unprecedented external challenges and are taking more
time to choose each element of new composable commerce ecosystems.
Despite this backdrop, and with new confidence against the
competition, our team has secured some excellent new Enterprise
client wins during the last six months.
Our People
The period saw the stepping down of Nick Habgood as Attraqt's
chairman. I know the Board joins me in thanking Nick for his
energetic and dynamic contribution, alongside sage advice. I was
very pleased to take on the mantle from Nick and look forward to
working with the Board as the Company looks to continue to make
operational and financial progress.
I would like to take the opportunity for me to say a huge thank
you to our talented team, engaged customers and exciting partners
for their passion, support, shared experience and drive to succeed,
and we look forward to achieving noteworthy success together in the
period ahead and beyond.
Outlook
The adoption of online retail that was seen during the pandemic
is showing no sign of abating and both retailers and brands are
ever more aware of what they need to do to attract, transact with
and retain their online customers. User experience, AI search and
product merchandising optimisation remains front of mind and our
product set puts our customers in the forefront of delivering a
first-class product discovery experience to the end customer.
I believe we are in an enviable position entering the period
ahead. We have an effective product, a motivated sales team and a
partnership program that has made our target market even more
exciting. As I said when I joined - I am confident that we can
build a scalable business, continue to service our customers'
needs, achieve operational excellence and bring further innovation
to the market. The key in the period ahead is our execution - the
first quarter has delivered a strong start and we have momentum in
the business.
Chief executive officer's statement
I am proud of the performance we have achieved this year,
underpinned by encouraging strategic progress and building traction
in both Enterprise and Mid-Market. It is clear our focus on
customer success continues to pay dividends with our net revenue
retention continuing to increase. Our Product Discovery solutions
are now an integral part of the best of breed technology stacks for
many of the world's leading brands and retailers as well as with
the fast-growing disruptive brands in the Mid-Market.
There is no doubt that retailers and brands remain laser focused
on optimising their online retail operations and our product suite
is delivering a tangible difference to the business performance of
our customers, making the value proposition irrefutable.
This tangible impact on our customers is illustrated, in part,
by the increase in our strategic upselling revenue in the period,
reflecting not only the strength of our relationships with our
clients, but also the positive impact that our product suite has on
our customers' eCommerce operations.
Alongside the strong customer relationships we have built and
are cultivating, the development of our business internally has
come on apace. Our partnerships have flourished in the period, as
has our innovation.
Underpinning all of this is a buoyant growth market - in
eCommerce and more specifically Product Discovery. This has been
evidenced by increased interest and investment in the sector as
well as our pipeline. We have expanded our target addressable
market considerably this year by targeting the Mid-Market and by
developing partnerships, allowing us to sell into the customer
bases of the fastest growing eCommerce platform players.
Progress in our markets
As a result of both our own innovation and embedding the
technology from our acquisitions, we are starting to become a
serious player in the Mid-Market, and building on our historic
position of strength in the Enterprise segment of the market with a
much more competitive product set.
The continued progress we have made in the Mid-Market is a
result of further defining our go to market strategy and has led to
an improvement in our conversion rates. I believe our product
discovery solutions for the Mid-Market are class leading and we
have brought Enterprise grade functionality to the Mid-Market
powered by AI. This disruptive strategy is now delivering
meaningful results as we signed the same number of Mid-Market logos
signed in the first quarter of 2022 compared to both Q3 and Q4 2021
combined.
Alongside this, we are now seeing solid growth in the pipeline
of our Enterprise segment as we have become more competitive with
our AI search and visual merchandising suite. The largest retailers
and brands are investing in re-platforming their legacy eCommerce
stacks, moving to new composable commerce solutions. This
investment means that customers in the Enterprise market are being
much more measured in deploying new technology, with brands and
retailers procuring our technology in one territory and then
rolling the project out incrementally once ROI is proven. This has
had the impact of lengthening lead times. However, we are pleased
to have seen several of these deals close into Q1 of 2022,
including one large win with a global fashion retailer and another
where we have been awarded preferred vendor status that is due to
close in mid Q2. Collectively these two wins would represent ARR of
close to GBP1m and a GBP3m total contract value over three years.
We expect to see more strategic upselling opportunities for global
rollouts going forward which will further improve our net revenue
retention.
Review of sales and operations
Our total revenue was up 9% to GBP22.9m (up 10% to GBP23.1m at
constant currency), driven by capacity and strategic up-sells to
our existing customers as well the benefits of our investment in
product and our customer teams starting to come through. There were
11 up-sells in the period of our AI Search functionality,
demonstrating the impact this functionality has had in making our
offering more integral to customers.
Our continued focus on best-in-class execution, client retention
and multi-year contract renewals has delivered positive results,
with the Group signing a further 35 multi-year contract renewals in
2021 (on top of 38 secured in 2020). In 2021 this included 10 out
of the Company's top 20 customers, leaving 80% of the Company's top
20 customers now signed up to multi-year contracts. These
commitments highlight the strong relationships Attraqt has with its
customer base and how important its technology is to many of the
world's leading brands' online retail operations. This is also
reflected by our ever-improving net revenue retention rate (104%)
and the continued strength of our Net Promoter Score (25).
We now have a more targeted approach of selling into Enterprise
accounts which is driving up our average revenue per customer. This
is evidenced by major wins through FY21 with global multi-channel
retailers which will feed into improved net revenue retention over
time as we deploy our technology to more sites and geographies as
part of our international expansion sales play.
Strategic update
The strategic priorities we developed are at the heart of the
progress of our business and it is safe to say that our focus on
these priorities has served us well in the period. Our ongoing
priorities are:
-- Evolving our data-led approach
-- Increasing the speed of our innovation
-- Executing our partnership strategy
-- Replicating our UK success in other geographies
-- Improving the customer and developer experience
-- Being recognised as a market leader
Some of the key achievements in line with these priorities are
laid out below.
Executing our partnership strategy
Our partnership strategy, a major strategic focus, has developed
significantly and delivered strong results, with over 35% of our
Mid-Market lead flow now coming via partners. In Q1 2022 we
achieved over one third of our Mid-Market ARR from our partner
sourced leads which clearly demonstrates the success we are having
with our partners.
Following the native integration with BigCommerce being
completed in September, the Company has seen a number of native
integrations go live through this channel. This enables any
BigCommerce merchant to deploy Attraqt's search and merchandising
tools along with recommendations and personalisation to their
storefront with limited integration effort.
Demonstrating the importance of this relationship, Jon Woodall,
MD of Space 48 (our Platinum integration partner on BigCommerce)
said:
"Attraqt and Space 48 have built out a strong partner focused
relationship over the last 18 months. Our partnership is ideally
placed to take advantage of the great market conditions and we feel
confident that it will lead to more business and cross-pollination
of more clients. We look forward to the years ahead and making the
most of our partner-focused relationship."
We are also in the process of deploying other integrations,
including one with Shopify, which is expected to be deployed by the
end of Q2. Today around 19% of our inbound Mid-Market leads use
Shopify as their eCommerce platform which clearly demonstrates the
demand from the Shopify customer base. Once launched we will be
able to serve Shopify merchants with search, merchandising and
recommendations functionality through one instantly deployable plug
in.
Increasing the speed of our innovation
We successfully embedded the core of our AI search function in
the first six months of the year and are now beginning to look at
further innovations in terms of visual search, search
personalisation and semantic tagging in order to take pioneering
steps forward in search innovation. We are conscious that in order
to maintain our market-leading position we need to be constantly
innovating and we are now in a position to do so organically on our
core technologies.
Improving the customer and developer experience
During the year, we focused on improving the developer
experience as well as the customer experience, for example,
launching a new user interface refresh of Fredhopper in Q4 and
outlining our API strategy so that developers can take advantage of
our tech with ease, both of which will continue to be a big part of
our product roadmap in the year ahead. We have been busy developing
documentation and collateral for our partners including training
and enablement materials so that they are able take our products to
market and deploy them. In the year we launched the Attraqt
training academy and a new partner programme with developer and
sales certifications. We are fast maturing as a partner centric
company and our partners will be a significant driver of our growth
and ability to scale for years to come.
Investing in our team
During the period, we have further invested in our marketing
function. The result of this is that we are now generating double
the amount of lead flow from marketing initiatives compared to what
we were seeing at this point last year. We have also invested in
our sales team across all regions, who are proficiently identifying
high quality opportunities. Our strategy to split the sales
function into Mid-Market and Enterprise supported by partner
managers is now paying dividends in the UK with an enhanced
pipeline, and our focus is to replicate this throughout our core
regions in 2022.
This year, more than ever, we have seen the quality of our team
shine through. I would like to take this opportunity to thank them
for their hard work, dedication and ongoing enthusiasm during the
year. Attraqt competes with a number of exceptionally well-funded
global leading technology vendors yet we outperform them in our
core markets through technology that better solves the key
challenges of digital commerce today. It is our heritage, our
industry expertise, our focus and the commitment of our people that
enable our success and we are truly grateful to all of them.
I would also like to thank all our customers, partners and
shareholders for their continued support throughout the year. I
look forward to achieving further successes together in the
future.
Outlook
Current trading has begun well with a strong level of new
bookings in Q1 across both Enterprise and Mid-Market, demonstrating
the momentum we have put into the business. Importantly, Attraqt
was selected above two key competitors in pitch processes during Q4
FY21 and Q1 FY22, demonstrating the power and appeal of our current
offering.
We are cognisant of the inflationary environment and the
potential impact on consumer confidence but are not currently
seeing any impact on our sales or pipeline and believe we are in a
good position to navigate this environment going forward. Due to
the increasingly global nature of our revenues, the impact of FX is
a headwind in the current year, as such we will be using constant
currency comparisons going forwards to provide a clearer indication
of the Group's underlying performance.
Looking ahead, we remain confident in our proposition, our
products and our strategy. Attraqt's technology is integral to the
delivery of online retail operations and the commercial success of
our merchants. We firmly believe that we are well positioned to
execute our growth strategy with significant momentum going into
FY22.
Our focus for the year ahead is building further traction in the
Mid-Market and continuing to build on our Enterprise success.
Alongside this, we will be deploying a greater proportion of the
available spend to go-to-market initiatives in 2022, as previously
communicated.
We are confident that we can continue to effectively address
what our customers need better than our competition, deliver
against our growth strategy and create value for all our
stakeholders.
Chief Financial Officer's Statement
Revenue for the year increased by 9% to GBP22.9m (2020:
GBP21.0m), up 10% to GBP23.1m at constant currency.
SaaS revenues increased by 8% to GBP20.9m (2020: GBP19.3m)
driven by strategic upsells and capacity growth in existing
accounts. Services Revenue increased by 18% to GBP2.0m (2020:
GBP1.7m).
Revenue 2021 statutory 2021 at constant 2020 statutory Growth reported Growth at
currency on a statutory constant
basis currency
SaaS GBP20.9m GBP21.1m GBP19.3m 8% 9%
---------------- ------------------ ---------------- ---------------- ----------
Services GBP2.0m GBP2.0m GBP1.7m 18% 18%
---------------- ------------------ ---------------- ---------------- ----------
Total GBP22.9m GBP23.1m GBP21.0m 9% 10%
---------------- ------------------ ---------------- ---------------- ----------
Gross profit increased by 4% to GBP16.2m (2020: GBP15.5m), but
the gross profit margin decreased by 3 percentage points to 71%.
The SaaS gross margin decreased by 3% percentage point to 77% due
to increase of costs of our Amazon Web Services (AWS) and Google
Cloud estates caused by higher hosting cost in legacy XO customers.
We are disappointed by the decline in SaaS gross margin and driving
it back to 80% is a key priority for 2022. The Services gross
margin stayed the same at 9% and we believe this will be driven
higher in 2022 due to higher staff utilisation.
Adjusted EBITDA(1) of GBP0.7m profit (2020: GBP1.1m) declined in
the year due to increased hosting costs, and a rebound in sales
& marketing expenditure after the cutbacks last year due to
COVID-19.
The exceptional costs of GBP0.6m (2020: GBP0.3m) in the year
relate to severance costs and other people costs of GBP0.5m and the
final settlement for the EB acquisition of GBP0.1m.
Depreciation and amortisation totalled GBP4.1m (2020: GBP3.5m),
increased due to the full year impact of the acquired intangibles
that were created on Aleph acquisition. There was a share-based
payment charge of GBP0.2m (2020: GBP0.1m).
Loss before tax was GBP4.2m (2020: GBP2.6m loss), with the tax
credit in the period GBP0.7m (2020: credit GBP0.4m). Therefore,
loss for the year after tax was GBP3.5m (2020: GBP2.2m loss).
Foreign exchange exposure
Cash flow forecasts are maintained for each major operating
currency (GBP, EUR, USD, AUD) to manage transaction exposure. The
expectation is that the Group will have more AUD than required but
be short of USD. Currency forecasts are regularly reviewed and
where necessary are hedged using forward contracts in the current
statutory period. Hedging instruments as well as spot deals may
only be traded with approved counterparties. Due to the
increasingly global nature of our revenues, the impact of FX is a
headwind in the current year, as such we will be using constant
currency comparisons going forwards to provide a clearer indication
of the Group's underlying performance.
COVID-19 pandemic
The potential impact of the COVID-19 pandemic on Attraqt's
trading performance and all our principal risks has been assessed
with mitigation plans put in place. Up to the date of this report,
the pandemic has, as anticipated, positively impacted capacity
upsells, but negatively impacted the close rate on new business
opportunities. Thankfully, the situation has improved over the last
six to twelve months due to the vaccine rollout, but we continue to
monitor the situation closely, as this continues to be an uncertain
situation, with the ultimate severity, duration and impact unknown
at this point.
Cash
The cash balance at the end of the period was GBP3.5m (2020:
GBP6.6m), which was a decrease of GBP3.1m during the year. The
decrease was mainly due to capitalised development expenditure of
GBP2.0m (as we prepared the Mid-Market product to increase our
total addressable market), the payment of deferred consideration on
acquisitions of GBP0.8m and the payment of delayed Covid tax
liabilities of GBP0.5m. The business plan and momentum for 2022
moves Attraqt to underlying cash neutral trading and marks an
important milestone.
Business Drivers
The key to growing value in a SaaS business is to grow the
Annual Recurring Revenue (ARR) by understanding and then moving the
levers that impact it. The ARR increased by 7% to GBP22.6m at
constant currency rates (4% to GBP21.9m reported) from GBP21.1m in
2020 and was driven by some large size new customers embarking on
first phase roll-outs and sales of the new acquired AI Search
product to our existing customers.
The first lever that impacts ARR is the booking of new,
recurring revenue. Recurring bookings in 2021 were GBP3.5m (2020:
GBP3.9m). Gross Attrition is an important KPI for our business
because it challenges us to understand why our customers leave and
find preventative actions. Another important KPI is Net Revenue
Retention because it indicates how well we are serving our existing
customers. Gross Attrition for 2021 was 10.6% (GBP2.2m), which is a
significant reduction from 14% (GBP2.7m) in 2020 and the NRR was
strong at 104% (2020 102%).
This strategic report has been approved and is signed on behalf
of the Board:
Eric Dodd
Chief Financial Officer
7 April 2022
1 Adjusted EBITDA refers to earnings before interest, tax,
depreciation, amortisation, other income and foreign exchange (see
note 6), share based payments (note 17) and exceptional items (note
5).
CONSOLIDATED INCOME STATEMENT
For the year ended 31 December 2021
Note 2021 2020
GBP'000 GBP'000
Revenue 4 22,863 21,003
Cost of Sales 4 (6,698) (5,502)
-------------------------------------------- ---- -------- --------
Gross profit 16,165 15,501
Administration expenses (19,763) (17,822)
Exceptional administrative expenses 5 (562) (256)
-------------------------------------------- ---- -------- --------
Total administrative expenses (20,325) (18,078)
-------------------------------------------- ---- -------- --------
Loss from operations 6 (4,160) (2,577)
-------------------------------------------- ---- -------- --------
Net finance costs (82) (58)
Loss before tax (4,242) (2,635)
Taxation credit 8 711 408
-------------------------------------------- ---- -------- --------
Loss for the year (3,531) (2,227)
-------------------------------------------- ---- -------- --------
Loss per share attributable to the ordinary
equity holders of the company
-------------------------------------------- ---- -------- --------
Basic and diluted EPS 9 (1.8p) (1.2p)
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the year ended 31 December 2021
Note 2021 2020
GBP'000 GBP'000
------------------------------------------------------ ----- ------- -------
(Loss) for the year (3,531) (2,227)
------------------------------------------------------------- ------- -------
Foreign exchange translation differences (251) (50)
------------------------------------------------------------- ------- -------
Total other comprehensive ( loss) for the
year (251) (50)
------------------------------------------------------------- ------- -------
Total comprehensive (loss) for the year, attributable
to shareholders of the parent (3,782) (2,277)
------------------------------------------------------------- ------- -------
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
For the year ended 31 December 2021
Notes 2021 2020
GBP'000 GBP'000
Non-current assets
Plant and equipment 10 220 243
Right of use assets 11 1,171 1,073
Intangible assets 12 41,211 40,585
Total non-current assets 42,602 41,901
-------------------------------------------- ------ -------- --------
Current assets
Trade and other receivables 14 6,026 6,155
Cash and cash equivalents 15 3,515 6,591
Corporation tax 494 573
Total current assets 10,035 13,319
-------------------------------------------- ------ -------- --------
Total assets 52,637 55,220
-------------------------------------------- ------ -------- --------
Current Liabilities
Trade and other payables 18 10,080 11,667
Corporation tax 672 267
Total current liabilities 10,752 11,934
-------------------------------------------- ------ -------- --------
Non-current liabilities
Deferred tax liability 8 2,481 2,839
Bank Loan 394 -
Lease liability 11 686 737
Total non-current liabilities 3,561 3,576
-------------------------------------------- ------ -------- --------
Net Assets 38,324 39,710
Equity
Issued capital 16 2,016 1,961
Share premium 16 55,480 53,251
Merger reserve 1,457 1,457
Share based payment reserve 17 1,697 1,585
Foreign exchange reserve (526) (275)
Accumulated deficit (21,800) (18,269)
-------------------------------------------- ------ -------- --------
Total equity attributable to equity holders
of the parent 38,324 39,710
CONSOLIDATED STATEMENT OF CHANGES OF EQUITY
For the year ended 31 December 2021
Notes Share Share Merger Share Foreign Retained Total
capital premium reserve based exchange earnings
payment reserve
reserve
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 1 January 2020 1,800 48,516 1,457 1,423 (225) (16,042) 36,929
Loss for the year - - - - - (2,227) (2,227)
Foreign currency translation
differences - - - - (50) - (50)
----------------------------------- ----- -------- -------- -------- -------- -------- --------------- -------
Total comprehensive loss
for the year - - - - (50) (2,227) (2,277)
-------- -------- -------- -------- -------- --------------- -------
Contributions by and distributions
to owners
Shares issued 16 161 4,991 - - - - 5,152
Issue costs - (256) - - - - (256)
Contingent shares to be
issued - - - 103 - - 103
Share based payment charge 17 - - - 59 - - 59
Total contributions by
and distributions to owners 161 4,735 - 162 - - 5,058
----------------------------------- ----- -------- -------- -------- -------- -------- --------------- -------
Balance at 31 December
2020 1,961 53,251 1,457 1,585 (275) (18,269) 39,710
----------------------------------- ----- -------- -------- -------- -------- -------- --------------- -------
Loss for the year - - - - - (3,531) (3,531)
Total comprehensive (loss)
for the year - - - - - (3,531) (3,531)
----------------------------------- ----- -------- -------- -------- -------- -------- --------------- -------
Contributions by and distributions
to owners
Shares issued 16 55 2,229 - - - - 2,284
Issue costs - - - - - - -
Contingent shares to be
issued - - - (103) - - (103)
Share based payment charge 17 - - - 215 - - 215
Foreign currency translation
differences - - - - (251) - (251)
----------------------------------- ----- -------- -------- -------- -------- -------- --------------- -------
Total contributions by
and distributions to owners 55 2,229 - 112 (251) - 2145
----------------------------------- ----- -------- -------- -------- -------- -------- --------------- -------
Balance at 31 December
2021 2,016 55,480 1,457 1,697 (526) (21,800) 38,324
----------------------------------- ----- -------- -------- -------- -------- -------- --------------- -------
CONSOLIDATED STATEMENT OF CASH FLOWS
For the year ended 31 December 2021
Notes 2021 2020
GBP'000 GBP'000
Cash flows from operating activities
Loss for the year (3,531) (2,227)
Adjustments for:
Depreciation of property, plant and equipment 10 142 139
Amortisation of intangible fixed assets 12 3,454 2,817
Depreciation of right of use assets 11 522 574
Income tax (credit) 8 (711) (408)
Share based payment expense 17 215 59
Finance costs 82 58
Foreign exchange differences (49) (99)
---------------------------------------------------- ----- ------- -------
124 913
Decrease/(increase) in trade and other receivables 129 (1,110)
(Decrease)/Increase in trade and other payables (1,011) 880
---------------------------------------------------- ----- ------- -------
Cash (used)/generated in operating activities
before interest and tax (758) 683
Taxation received /(paid) 841 (166)
Net cash generated in operating activities 83 517
Cash flows used in investing activities
Asset purchase (350) -
Fair value gain on forward contract - -
Purchases of Property, plant and equipment 10 (128) (66)
Additions of internal software development
intangible 12 (2,025) (1,341)
Net cash (used)/generated from investing activities (2,503) (1,407)
Cash flows from financing activities
Lease payments (540) (626)
Lease interest (66) (61)
Interest received - 3
Issue of ordinary shares, net of issue costs - 3,744
Loan received - 450
Repayments of loan (26) (27)
Net cash (used in)/ generated from financing
activities (632) 3,483
---------------------------------------------------- ----- ------- -------
Net (decrease)/ increase in cash and cash
equivalents (3,052) 2,593
---------------------------------------------------- ----- ------- -------
Cash and cash equivalents at beginning of
year 6,591 3,950
Effect of foreign currency exchange rate changes (24) 48
Cash and cash equivalents at end of year 15 3,515 6,591
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 December 2021
1. GENERAL INFORMATION
Attraqt Group plc ("the Company") and its subsidiaries
(collectively, the 'Group') principal activity is the development
and provision of eCommerce site search, merchandising and product
recommendation technology.
The financial information included in this preliminary
announcement does not constitute the Company's statutory accounts
for the year ended 31 December 2021 and for the year ended 31
December 2020 but is derived from those accounts. Statutory
accounts for the year ended 31 December 2020 have been delivered to
the registrar of companies, and those for year ended 31 December
2021 will be delivered in due course. The auditor has reported on
those accounts; their reports were (i) unqualified, (ii) did not
include a reference to any matters to which the auditor drew
attention to by way of emphasis without qualifying their report,
and (iii) did not contain a statement under section 498 (2) or (3)
of the Companies Act 2006. The consolidated financial statements of
the Company have been prepared in accordance with international
accounting standards in conformity with the requirements of the
Companies Act 2006 and in accordance with UK adopted international
accounting standards.
The Company is a public limited company which is quoted on the
Alternative Investment Market on the London Stock Exchange, and is
incorporated, registered and domiciled in England and Wales
(registered number: 08904529). The address of its registered office
is 7(th) Floor, 222-236 Gray's Inn Road, London, WC1X 8HB.
2. ACCOUNTING POLICIES
The principal accounting policies applied in the preparation of
these financial statements are set out below. These policies have
been consistently applied to all the years presented, unless
otherwise stated.
Basis of preparation
The consolidated financial statements of Attraqt Group plc for
the year ending 31 December 2021 comprise the results of Attraqt
Group plc ('the Company') and its subsidiaries (together, the
'Group'). These financial statements have been prepared on a going
concern basis and in accordance with UK adopted international
accounting standards subject to any material departures disclosed
and explained in the group and company financial statements. The
parent company financial statements have been prepared in
accordance with FRS 101, Financial Reporting Standards Framework.
The Group financial statements are presented in UK sterling and all
values are rounded to the nearest thousand pounds (GBP'000), except
when otherwise indicated.
The requirements of the Companies Act 2006 here means accounts
being prepared in accordance with 'international accounting
standards' as defined in section 471(1) of the Act, as it applied
immediately before the Implementation Period completion day (end of
transition period), including where the company also makes use of
which have been adopted for use within the United Kingdom in
accordance with regulation 1(5) of the International Accounting
Standards and European Public Limited Liability Company (Amendment
etc.) (EU Exit) Regulations 2019.
The preparation of financial statements in conformity with IFRS
requires the use of certain critical accounting estimates. It also
requires management to exercise its judgement in the process of
applying the Group's accounting policies. Further details on the
Group's critical judgements and estimates are included in note
3.
Going concern
As part of the Directors' consideration of the appropriateness
of adopting the going concern basis in preparing the financial
statements, given the uncertainty of COVID-19, the Group has
continued to monitor the impact of COVID-19 by reviewing the
monthly results versus the budget set for 2021. The Group has not
seen a severe impact in the year with consolidated Revenue up year
on year. The consolidated cash balance available to the Group is
healthy at GBP3,515,000. The Group has continued to offer services
and support to our clients uninterrupted by the national lockdowns
in 2021 and has not relied upon any furlough schemes available. The
Group, via Attraqt Limited, took advantage of available options in
2020 to defer VAT which was settled in quarter 1 of 2021.
To address uncertainties arising in the current environment, the
Group has maintained the additional financing secured in 2021 of an
overdraft facility of GBP250,000 within Attraqt Limited and will
repay the EUR 500,000 loan via its French subsidiary Early Birds
S.A.S. over a 5 year period with the first repayment being due in
July 2022.
The Group has assessed the ongoing situation in Ukraine and
there is limited impact to the business because the Group has no
customers or assets in Ukraine, Belarus or Russia. We note that
some of our multinational customers have paused business operations
in Russia in response to the situation but due to the global reach
of these customers, the Group has determined that there will be
limited effect. The Group will continue to monitor the
situation.
The Group's Directors have revised the Groups forecast taking
into account the resilience of future sales, customers and the
impacts of future possible COVID-19 related national lockdowns and
performed sensitivity analysis on monthly consolidated cash flows
to April 2023. Those forecasts make assumptions in respect of
future trading conditions, notably the economic environment and its
impact on Group's revenues. The forecasts take into account
foreseeable downside risks, based on the information that is
available to the Directors at the time of approval of these
financial statements, however it is not possible to quantify the
ongoing impact with certainty.
Directors have identified that there is sensitivity to a
reduction in revenue receipts, with sustained reduction of over 9%
of annual recurring revenue bringing the Group outside existing
cash facilities without any mitigating cost reductions, however
they consider this to be unlikely given the impact seen within the
business in the current financial year to date and the return to
normal with the lifting of restrictions.
Should revenue cash flows deteriorate, management would take
some mitigating actions, which include but are not limited to:
-- Negotiating longer credit terms with suppliers;
-- Changing invoicing terms with customers to upfront
payment;
-- Reduction in marketing spend in relation to events; and
-- Delay in staff recruitment.
Based on the above, acknowledging the uncertainty in the
economic environment as a result of the pandemic, the Board remains
satisfied that the Group holds sufficient cash together with bank
and other facilities and has further options available to meet its
working capital requirements for at least 12 months from the date
of approval of these financial statements and therefore supports
the preparation of the financial statements on a going concern
basis.
Revenue
Revenue represents sales to external customers at invoiced
amounts less value added tax or local taxes on sales. Where work is
completed at the year-end but not invoiced, the Attraqt Group
accrues for this income. Attraqt invoices in advance which is
reported as deferred income and is recognised as revenue in the
income statement as the service is delivered to the customer. The
Group derives the majority of its revenue from the provision of
e-commerce services via a license fee to online retailers which
includes site search, merchandising and product recommendation
technology. The Group determines the transaction price to which it
expects to be entitled in return for providing the promised
obligation to the customer based on the committed contractual
amounts fixed cost agreed it with clients. The Group has the
following revenue streams:
SaaS license fee : In the case of SaaS Licence Fee only
contracts, revenue is recognised over time which is measured based
on the dates defined in the contract, as the customer has access to
the vendor's intellectual property as it exists at any given time
throughout the licence period. Implementation fees associated with
these licenses are recognised over the transaction period which is
defined in the contract, fees not associated with a license are
recognised at the end of the implementation period.
On-going services : Revenue in relation to Technical
Consulting/Business consulting contracts have distinct performance
obligations I.e. the number of consulting days defined in the
contract, will be recognised at a point in time according to time
and materials used - therefore, once the customer consumes the
benefits from the service provided, the revenue is recognised.
Revenue from the sale of prepaid services are deferred until such
time that the client utilises the services, or the contract
expires. Utilisation of services can include either milestones set
out in the project or consultancy days, therefore revenue is
recognised when the consultancy days have been consumed or
milestones defined in the project have been met.
Overage fees: In the case where overage charges apply, revenue
is recognised immediately based on the terms defined in the
contract, as Attraqt Group do not become entitled to revenue for
these charges until it is certain that the usage will breach 100%
of the allowance in the contract.
Contract assets represent prepaid commission to employees, this
is recognised over the life of the corresponding customer contract
in order to match the liability with the revenue earned.
Contract liabilities represents deferred income, which is
recognised in over time in accordance with the customer
contract.
Exceptional items
Exceptional items are those which, by virtue of their nature,
size or incidence, either individually or in aggregate, need to be
disclosed separately to allow full understanding of the underlying
performance of the Group.
Foreign currency translation
The functional and presentation currency of Attraqt Group plc is
GBP. Transactions in foreign currencies are translated into the
functional currency using exchange rates prevailing at the date of
the transaction. Monetary assets and liabilities denominated in
foreign currencies are retranslated at the rate of exchange ruling
at the balance sheet date. Exchange differences arising on the
settlement of monetary items and on the retranslation of monetary
items are taken to the consolidated income statement.
For the purposes of preparing consolidated financial statements,
the assets and liabilities of foreign subsidiary undertakings are
translated at the exchange rates ruling at statement of financial
position date. Profit and loss items are translated at the exchange
rate ruling at the date of the transaction. Exchange differences
arising are taken to the Group's foreign currency translation
reserve.
Pension
The Group operates a defined contribution scheme. Obligations
for contributions to the defined contribution pension schemes are
recognised as an expense in the income statement as incurred.
Government grants
Government grants are recognised at fair value when the grant is
received and recognised in the statement of profit or loss. The
government grants are netted against the expenses of the same
nature.
Intangible assets
Externally acquired intangible assets are initially recognised
at cost and subsequently amortised on a straight-line basis over
their useful economic lives.
Intangible assets are recognised on business combinations if
they are separable from the acquired entity or give rise to other
contractual/legal rights.
Externally acquired intangible assets not acquired as part of a
business combination are initially recognised at cost and
subsequently amortised on a straight line basis over their useful
economic lives.
The significant intangibles recognised by the Group, their
useful economic lives and the methods used to determine the cost of
intangibles acquired in a business combination are as follows:
Intangible Useful economic Useful economic Useful economic Valuation Method
Asset life life life
for Fredhopper for Early for Aleph
intangibles Birds intangibles intangibles
Customer 11 years 9 years n/a Excess Earnings Method -
Relationships the value of the intangible
asset is the present value
of the after-tax cash flows
potentially attributable
to it, net of the return
on fair value attributable
to tangible and other intangible
assets.
Existing 7 years 10 years 10 years Relief from Royalty Method
Technology - the value of intangible
assets are estimated by
capitalising the royalties
saved because the company
owns the intangible asset.
Trade Names 10 years 10 years n/a Relief from Royalty Method
- the value of intangible
assets are estimated by
capitalising the royalties
saved because the company
owns the intangible asset.
The amortisation expense is charged to the administrative
expense line in the consolidated statement of comprehensive
income.
Internally generated intangible assets (development costs)
Expenditure on internally developed products is capitalised if
it can be demonstrated that:
-- it is technically feasible to develop the product for it to be sold;
-- adequate resources are available to complete the development;
-- there is an intention to complete and sell the product;
-- the Group is able to sell the product;
-- sale of the product will generate future economic benefits; and
-- expenditure on the project can be measured reliably.
Capitalised development costs are amortised over three years.
The amortisation expense is included within administrative expenses
in the consolidated statement of comprehensive income.
Development expenditure not satisfying the above criteria and
expenditure on the research phase of internal projects are
recognised in the consolidated statement of comprehensive income as
incurred.
Where there is an event or change in circumstance in relation to
such judgement, the Group must make an estimate of the expected
future economic benefits to determine that assets are not
impaired.
Impairment of assets
Assets that are subject to depreciation or amortisation are
reviewed for impairment whenever events or changes in circumstances
indicate that the carrying amount may not be recoverable. An
impairment loss is recognised for the amount by which the asset's
carrying amount exceeds its recoverable amount. The recoverable
amount is the higher of an asset's fair value less costs to sell
and value in use. For the purposes of assessing impairment, assets
are grouped at the lowest levels for which there are separately
identifiable cash flows.
Consolidation
The results of all subsidiary undertakings are included in the
consolidated financial statements. Assets, liabilities, income and
expenses of a subsidiary acquired or disposed of during the year
are included in the consolidated financial statements from the date
the Group gains control until the date the Group ceases to control
the subsidiary.
Control is achieved when the Group is exposed, or has rights, to
variable returns from its involvement with the investee and has the
ability to affect those returns through its power over the
investee. Specifically, the Group controls an investee if, and only
if, the Group has:
power over the investee (i.e., existing rights that give it the
current ability to direct the relevant activities of the
investee);
exposure, or rights, to variable returns from its involvement
with the investee; and
the ability to use its power over the investee to affect its
returns.
Business combinations
Business combinations completed prior to 1 January 2020 are
accounted for using the acquisition method. Business combination
completed on or after 1 January 2020 the Group has a choice, on a
transaction by transaction basis to use a concentration test
whereby if substantially all of the fair value of the gross assets
acquired is concentrated in a single identifiable asset then this
is recognised as an asset acquisition and not a business
combination, if this test is not met the acquisition is accounted
for using the acquisition method.
The cost of an acquisition is measured as the aggregate of the
consideration transferred measured at acquisition date fair value
and the amount of any non-controlling interests in the acquiree.
For each business combination, the Group elects whether to measure
the non-controlling interests in the acquiree at fair value or at
the proportionate share of the acquiree's identifiable net assets.
Acquisition-related costs are expensed as incurred and included in
administrative expenses.
When the Group acquires a business, it assesses the financial
assets and liabilities assumed for appropriate classification and
designation in accordance with the contractual terms, economic
circumstances and pertinent conditions as at the acquisition
date.
Goodwill
Goodwill represents the excess of the cost of acquisition over
the fair value of the assets, liabilities and contingent
liabilities of acquired businesses at the date of acquisition.
Goodwill is stated at cost less accumulated impairment losses.
Goodwill is allocated to one cash-generating unit and is not
amortised but is tested annually for impairment, or more frequently
if there is an indication that the value of the goodwill may be
impaired.
Property, plant and equipment
Property, plant and equipment is initially recognised at cost
and is stated at cost less accumulated depreciation.
Property, plant and equipment is depreciated to reduce the
carrying amounts of the assets, less their estimated residual
values, over their expected useful lives, as follows:
Plant and machinery 3 years
Fixtures and fittings 3 years
Leasehold Improvements
Leasehold improvements are initially recognised at cost and is
stated at cost less accumulated depreciation.
Leasehold improvements are depreciated to reduce the carrying
amounts of the assets, less their estimated residual values, over
their expected useful lives, as follows:
Leasehold improvements Over the life
of the lease
Leases
The group leases various offices and equipment. Rental contracts
are typically made for fixed periods of 1 to 5 years but may have
extension options. Lease terms are negotiated on an individual
basis and contain a wide range of different terms and conditions.
The lease agreements do not impose any covenants, but leased assets
may not be used as security for borrowing purposes.
Payments associated with short-term leases and leases of
low-value assets are recognised on a straight-line basis as an
expense in profit or loss. Short-term leases are leases with a
lease term of 12 months or less.
Leases not meeting low value or short term of less than 12
months criteria are recognised as a right-of-use asset and a
corresponding liability at the date at which the leased asset is
available for use by the group. Each lease payment is allocated
between the liability and finance cost. The finance cost is charged
to profit or loss over the lease period so as to produce a constant
periodic rate of interest on the remaining balance of the liability
for each period. The right-of-use asset is depreciated over the
shorter of the asset's useful life and the lease term on a
straight-line basis.
Assets and liabilities arising from a lease are initially
measured on a present value basis. Lease liabilities include the
net present value of the following lease payments:
-- fixed payments (including in-substance fixed payments), less
any lease incentives receivable;
-- variable lease payment that are based on an index or a rate;
-- amounts expected to be payable by the Group under residual value guarantees;
-- the exercise price of a purchase option if the Group is
reasonably certain to exercise that option; and
-- payments of penalties for terminating the lease, if the lease
term reflects the Group exercising that option.
The lease payments are discounted using the interest rate
implicit in the lease. If that rate cannot be determined, the
lessee's incremental borrowing rate is used, being the rate that
the Group would have to pay to borrow the funds necessary to obtain
an asset of similar value in a similar economic environment with
similar terms and conditions.
Right-of-use assets are measured at cost comprising the
following;
-- the amount of the initial measurement of lease liability;
-- any lease payments made at or before the commencement date
less any lease incentives received;
-- any initial direct costs, and
-- restoration costs.
When the Group renegotiates the contractual term of a lease, the
lease liability is remeasured using the discount rate applicable on
the modification date, with the right of use asset being adjusted
by the same amount.
Cash and cash equivalents
Cash and cash equivalents comprise cash balances, call deposits
and a bank loan. The bank loan is repayable over a five year period
with no interest. There are no bank overdrafts in either year
presented.
Share capital
Ordinary shares are classified as equity. Incremental costs
directly attributable to the issue of new shares are deducted from
share premium.
Share based payments
The Group has issued share options to certain employees, in
return for which the Group receives services from employees. The
fair value of the employee services received in exchange for the
grant of the options is recognised as an expense, the Group fair
values the options at the grant date using the Black Scholes
valuation model to establish the relevant fair values for CSOP
options. In 2021 the Group has issued nil cost options to
Management and Executive members which have been equally split
between those with market conditions and those with a non-market
performance condition. The nil cost options with market conditions
are fair valued using the Monte Carlo valuation model and the nil
cost options with a non-market performance condition are assessed
at the end of each financial year to determine the probability of
the non-market performance condition being achieved at the vesting
date.
The total amount to be expensed is determined by reference to
the fair value of the options granted including any market
performance conditions (for example the Group's share price) but
excluding the impact of any service or non-market performance
vesting conditions (for example the requirement of the grantee to
remain an employee of the Group).
Non-market vesting conditions are included in the assumptions
regarding the number of options that are expected to vest. The
total expense is recognised over the vesting period. At the end of
each period the Group revises its estimates of the number of
options expected to vest based on the non-market vesting
conditions. It recognises the impact of any revision in the income
statement with a corresponding adjustment to equity.
Taxation including deferred taxation
Total income tax on the result for the year comprises current
and deferred tax. Income tax is recognised in the income statement
except to the extent that it relates to items recognised directly
in equity and other comprehensive income, in which case it is
recognised directly in equity and other comprehensive income.
Current tax is the expected tax payable on the taxable result
for the year, using tax rates enacted, or substantively enacted, at
the balance sheet date, and any adjustments to tax payable in
respect of previous years.
Current income tax assets and liabilities comprise those
obligations to fiscal authorities in the countries in which the
Group carries out its operations. They are calculated according to
the tax rates and tax laws applicable to the fiscal period and the
country to which they relate. All changes to current tax
liabilities are recognised as a component of tax expense in the
income statement unless the tax relates to an item taken directly
to equity in which case the tax is also taken directly to equity.
Tax relating to items recognised in other comprehensive income is
recognised in other comprehensive income.
Deferred tax is provided on all temporary differences between
the carrying amounts of assets and liabilities for financial
reporting purposes and the amounts used for taxation purposes,
except for:
-- goodwill not deductible for tax purposes;
-- the initial recognition of an asset or liability in a
transaction that is not a business combination and which, at the
time of the transaction, affects neither the accounting profit nor
the taxable profit or loss; and
-- investments in subsidiary companies where the timing of the
reversal of the temporary difference is controlled by the Group and
it is probable that the temporary difference will not reverse in
the foreseeable future.
The amount of deferred tax recognised is based on the expected
manner of realisation or settlement of the carrying amounts of
assets and liabilities, using tax rates enacted, or substantively
enacted, at the balance sheet date. A deferred tax asset is only
recognised to the extent that it is probable that future taxable
profits will be available against which the asset can be used.
Financial instruments
Recognition, derecognition and measurement of financial
instruments
Financial assets and financial liabilities are recognised when
Attraqt Group becomes party to the contractual provisions of the
financial instrument. Financial assets are derecognised when the
contractual rights to the cash flows from the financial asset
expire, or when the financial asset and all substantial risks and
rewards are transferred. A financial liability is derecognised when
the related contractual obligation is extinguished, discharged or
cancelled, or when it expires. Financial instruments are recognised
and derecognised using settlement date accounting. On initial
recognition, financial instruments are measured at fair value. Fair
value on initial recognition includes transaction costs directly
attributable to the acquisition or issue of financial instruments,
except for financial instruments carried at fair value through
profit or loss, for which transaction costs are recognised in the
consolidated statement of comprehensive income in the period when
they are incurred. The Groups Financial assets include trade
receivables, other receivables, and cash and cash equivalents,
financial liabilities include trade payables, employee benefits,
bank loan and employee benefits.
Classification of financial instruments
Financial assets
On initial recognition, a financial asset is classified and
subsequently measured at:
-- amortised cost;
-- fair value through profit or loss (FVTPL); or
-- fair value through other comprehensive income (FVOCI).
Business model assessment
The classification depends on Attraqt Group's business model for
managing these financial assets and the contractual terms of the
financial asset's cash flows. The business models objectives are
broken down into three categories:
-- Financial assets held solely to collect contractual cash flows;
-- Financial assets held both to collect contractual cash flows and selling the assets; and
-- Financial assets that are managed on a fair value basis.
A financial asset is measured at amortised cost if it meets both
of the following conditions and is not designated as FVTPL:
-- The asset is held within a business model whose objective is
to hold assets to collect contractual cash flows.
-- The contractual terms of the financial asset give rise on
specified dates to cash flows that are solely payments of principal
and interest on the principal outstanding.
A financial asset is measured at FVOCI only if it meets both of
the following conditions and is not designated as FVTPL:
-- The asset is held within a business model whose objective is
achieved by both collecting contractual cash flows and selling
financial assets.
-- The contractual terms of the financial asset give rise on
specified dates to cash flows that are solely payments of principal
and interest on the principal outstanding.
All other financial assets are classified as measured at
FVTPL.
Impairment of financial assets measured at amortised cost
The Group assesses on a forward looking basis expected credit
losses associated with its debt instruments carried at amortised
cost. The impairment methodology applied for trade receivables is
the simplified approach, which requires expected lifetime losses to
be recognised from initial recognition of the receivables.
Write-off policy
Financial assets are written-off after the Group has exhausted
all possible avenues of recovery from the customer and there is no
realistic prospect of recovering the amounts owed.
Financial liabilities
The Attraqt Group classifies its financial liabilities at
amortised cost unless it has designated liabilities at FVTPL or is
required to measure liabilities at FVTPL, these include trade
payables and short-term monetary liabilities. The Attraqt Group
designates a financial liability as measured at FVTPL on initial
recognition when it eliminates an accounting mismatch that would
otherwise arise from measuring assets or liabilities on a different
basis. A description of the basis for each designation is set out
in the major types of financial instruments section of this
note.
Subsequent measurement of financial instruments
Financial instruments are measured in subsequent periods either
at fair value or at amortised cost depending on the financial
instrument classification.
Financial instruments classified as at amortised cost
Subsequent to initial recognition, financial assets and
liabilities classified in this category are recognized at amortised
cost using the effective interest method. The effective interest
rate is the rate that exactly discounts the estimated future cash
payments and receipts through the expected life of the financial
asset or liability to its carrying amount. When calculating the
effective interest rate, the Attraqt Group estimate future cash
flows, considering all contractual terms of the financial
instrument. Interest income, interest expense and the amortisation
of loans fees are presented in the Consolidated Statement of
Income.
Financial instruments classified as at fair value through profit
or loss
Subsequent to initial recognition, g ains and losses upon the
sale, disposal or write-off of these financial instruments are
included directly in the Consolidated Statement of Comprehensive
Income and are reported within administrative expenses.
Equity Instruments
The Attraqt Group measures equity instruments at FVTPL, changes
in the fair value would be recognised in Statement of Comprehensive
Income.
Changes in accounting policy
New standards, interpretations and amendments not applied
As at date of approval of the Group financial statements, the
following new and amended standards, interpretations and amendments
in issue are applicable to the Group but not yet effective and
thus, have not been applied by the Group:
Effective date*
Amendments to IAS 1: Classification of 1 January 2022
Liabilities as Current or Non-Current
Annual improvements to IFRS standards 2018-2020 1 January 2022
(Amendments to IFRS 1, IFRS 9, IFRS 16
and IAS 41)
Disclosure of Accounting Policies (Amendments 1 January 2023
to IAS 1 and IFRS Practice Statement 2);
Definition of Accounting Estimates (Amendments 1 January 2023
to IAS 8)
Deferred Tax Related to Assets and Liabilities 1 January 2023
arising from a Single Transaction (Amendments
to IAS 12).
(* The effective dates stated above are those given in the
original IASB/IFRIC standards and interpretations. Following the
UK's withdrawal from the EU on 31 December 2020, the UK-adopted
international accounting standards will be applicable. In the
majority of cases this will result in an effective date consistent
with that given in the original standard or interpretation but the
need for endorsement restricts the Group's discretion to early
adopt standards.)
(At the date of authorisation of these financial statements,
these standards and interpretation have not yet been endorsed or
adopted by the UK.)
The Group is currently assessing the impact of these new
accounting standards and amendments.
The Directors do not expect the adoption of these standards,
interpretations and amendments to have a material impact on the
Consolidated or Parent Company financial statements in the period
of initial application.
3. CRITICAL ACCOUNTING JUDGEMENTS AND ESTIMATES
In the application of the Group's accounting policies, the
Directors are required to make judgements and estimates about the
carrying amounts of assets and liabilities that are not readily
apparent from other sources. The estimates and associated
assumptions are based on historical experience and other factors
that are considered to be relevant. Actual results may differ from
these estimates. There were no material judgements or estimates
used on application of IFRS 9 Financial Instruments or IFRS 15
Revenue from contracts with customers, there were no contracts that
straddled year end which required any judgement. The following
accounting policies have been identified as involving particularly
complex judgements or subjective estimates:
Judgements
-- Leases
Extension and termination options are included in a number of
property leases across the Group as well as contracts that include
rolling lease periods. These terms are used to maximise operational
flexibility in terms of managing contracts. The majority of
extension and termination options held are exercisable only by the
Group and not by the respective lessor.
In determining the lease term, management considers all facts
and circumstances that create an economic incentive to exercise an
extension option, allow the lease to roll forward for a further
lease period or not exercise a termination option. Extension
options and rolling lease periods (or periods after termination
options) are only included in the lease term if the lease is
reasonably certain to be extended (or not terminated). The
assessment is reviewed if a significant event or a significant
change in circumstances occurs which affects this assessment and
that it is within the control of the Group.
-- Capitalisation and impairment of development costs
It is a requirement under IFRS that development costs that meet
the criteria prescribed in the standard are capitalised. The
assessment of each project requires that a judgement is made as to
the commercial viability and the ability of the Group to bring the
product to market. Where there is an event or change in
circumstance in relation to such judgement, the Group must make an
estimate of the expected future economic benefits to determine that
assets are not impaired.
Estimates
-- Share based payments
Share options are recognised as an expense based on their fair
value at date of grant and staff turnover. The fair value of the
options is estimated through the use of a valuation model - which
require inputs such as the risk-free interest rate, expected
dividends, expected volatility and the expected option life - and
is expensed over the vesting period. Some of the inputs used to
calculate the fair value are not market observable and are based on
estimates derived from available data, such as employee exercise
behaviour and employee turnover.
-- Goodwill Impairment
Goodwill is tested for impairment annually and whenever events
or changes in circumstances indicate that the carrying amount of
goodwill has been impaired. In order to determine if the value of
goodwill has been impaired, the cash-generating unit to which
goodwill has been allocated must be valued using present value
techniques. When applying this valuation technique, the Group
relies on a number of factors, including historical results,
business plans, forecasts and market data. This is further
described in note 12. As can be deduced from this description,
changes in the conditions for these judgements and estimates can
significantly affect the assessed value of goodwill.
-- Valuation of acquired intangible assets
Intangible assets acquired in a business combination are
required to be recognised separately from goodwill and amortised
over their useful life if they are subject to contractual or legal
rights or are separately transferable and their fair value can be
reliably estimated. The Group has separately recognised the
intangible assets acquired during the acquisition for acquisition
in prior years (see note 12).
The fair value of these acquired intangible assets is based on
valuation techniques. The valuation models require input based on
assumptions about the future. The management uses its best
knowledge to estimate fair value of acquired intangible assets as
of the acquisition date. The value of intangible assets is tested
for impairment when there is an indication that they might be
impaired (see below). The management must also make assumptions
about the useful life of the acquired intangible assets which might
be affected by external factors.
4. SEGMENTAL REPORTING
For the purpose of IFRS 8, the chief operating decision maker
takes the form of the Board of Directors. The Directors' opinion is
that the business of the group is to provide cloud-based e-commerce
solutions. Based on this, there is one reportable segment. The
internal and external reporting is on a consolidated basis with
transactions between group companies eliminated on
consolidation.
2021 2020
GBP'000 GBP'000
Revenue by type
SaaS 20,870 19,278
Services 1,993 1,725
Total Revenue 22,863 21,003
Cost of Sales by type
SaaS 4,880 3,932
Services 1,818 1,570
Total Cost of Sales 6,698 5,502
---------------------- ------- -------
Gross profit 16,165 15,501
---------------------- ------- -------
There is no one customer which contributed more than 10% of the
Group's revenues in 2021 (2020: 1 customer - contributing
GBP2.1m).
The table below provides an analysis of the Group's revenue by
geographical market where the customer is based.
2021 2020
GBP'000 GBP'000
Geographical split of revenue
UK 10,537 9,861
France 5,058 4,979
Netherlands 2,492 2,441
Rest of Europe 3,126 2,619
Rest of the World 1,650 1,103
Total Revenue 22,863 21,003
Contract assets and liabilities
Contract Assets
2021 2020
GBP'000 GBP'000
At 1 January 828 175
Recognised 1,041 1,360
Amortised (989) (707)
At 31 December 880 828
Contract liabilities
2021 2020
GBP'000 GBP'000
At 1 January 5,545 5,438
Recognised as revenue (20,870) (20,015)
Recognised as deferred
income 21,120 20,122
At 31 December 5,795 5,545
Contract assets are included within trade and other receivables,
contract liabilities are included within trade and other payables.
The contract liability balance arises from contracts that relate to
the next financial year. Contract assets relate to upfront
commissions which are amortised over the length of the contract
which can span up to 3 years.
5. EXCEPTIONAL ITEMS
During 2021, total exceptional costs incurred GBP562,000 (2020:
GBP256,000) of which GBP482,000 relates to severance and people
related costs, GBP80,000 in relation to final settlement for the EB
acquisition.
The exceptional costs for 2020 consist of GBP38,000 relating to
restructuring, GBP35,000 relating to entity closure costs and
GBP183,000 relating to the legal and professional advice associated
with the asset purchase and post-acquisition integration.
6. LOSS FROM OPERATIONS
2021 2020
GBP'000 GBP'000
Loss from operations is taken after taking account
of the following items:
Staff costs (see note 7) 12,949 12,368
Depreciation of property, plant and equipment
(see note 10) 142 139
Amortisation of intangible assets (see note 12) 3,454 2,817
Depreciation of Right of use assets (see note
11) 522 574
Operating lease expense 56 100
Research and Development costs 1,204 1,254
Foreign exchange loss (profit) 49 (99)
Other income - (54)
Audit and non-audit services:
Fees payable to the company's auditors for the
audit of the Group annual accounts:
Group annual accounts and subsidiary undertakings 130 130
Fees payable to the company's auditor and its
associates for other services:
Tax services 43 21
Audit related assurance services 9 10
Other services - 5
7. STAFF COSTS
The average number of persons employed by the Group (including
directors) during the year, analysed by category was as
follows:
(No.) 2021 2020
Sales 17 15
Technical 107 105
Management (including directors) 6 6
Administration 35 33
165 159
The average number of full-time equivalent persons employed by
the Group during the year, analysed by category, was as
follows:
(No.) 2021 2020
Sales 17 15
Technical 107 104
Management (including directors) 6 6
Administration 34 32
164 157
The aggregate payroll costs of these persons were as
follows:
2021 2020
GBP'000 GBP'000
Staff costs (including directors) comprise:
Wages and salaries 10,447 10,225
Social security contributions and similar taxes 1,957 1,827
Pension 330 257
Share Based Payment 215 59
------------------------------------------------ ------- -------
12,949 12,368
Capitalised staff costs total GBP1,275,000 (2020: GBP873,000).
Pension costs are in respect of the defined contribution scheme;
there were unpaid contributions at 31 December 2021 of GBP97,000
(2020: GBP91,000).
The total of the directors' remuneration is GBP922,000. The
highest paid director is GBP343,000.
8. TAXATION
2021 2020
GBP'000 GBP'000
Tax (credit) comprises:
Current tax on loss for the year (368) (242)
Current tax adjustment in relation to prior years 15 192
Deferred Tax for the year (358) (358)
-------------------------------------------------- ------- -------
(711) (408)
The effective tax assessed for the year, all of which arises in
the UK, differs from the standard weighted rate of corporation tax
in the UK.
The reconciliation of the actual tax charge to that at the
domestic corporation tax rate is as follows:
2021 2020
GBP'000 GBP'000
Loss for the year before tax (4,242) (2,635)
Expected tax charge based on the standard rate
of United Kingdom corporation tax at the domestic
rate of 19.00% (2020 - 19.00%) (806) (501)
Expenses not deductible for tax purposes 93 191
Adjustment in respect of prior years 15 192
Unrelieved losses arising in the period 371 231
Additional deduction for R&D expenditure (482) (642)
Surrender of tax losses for R&D tax credit refund 85 91
Changes in rates of tax - -
Adjustment for different rates of corporation
taxation in overseas jurisdictions 13 30
------------------------------------------------------ ------- -------
Total tax (credit) (711) (408)
At 31 December 2021, tax losses estimated at GBP8.7m (2020:
GBP8.5m) were available to carry forward by the Attraqt group,
arising from historic losses incurred. Management believe it is
prudent not to recognise the deferred tax asset until they can be
utilised against future profits.
On the 3 March 2021 Budget it was announced that the UK tax rate
will increase from 19% to 25% from 1 April 2023. This has a
consequential effect on the company's future tax charge. The rate
change to 25% had been substantively enacted at the current balance
sheet date. The impact of the rate change in the current year is
therefore GBPnil.
DEFERRED TAX
GBP'000
At 1 January 2020 3,197
Arising through business combinations -
Recognised in profit or loss (358)
-------
At 31 December 2020 2,839
Recognised in profit or loss (358)
At 31 December 2021 2,481
2021 2020
Categorised as: Asset Liability Net Asset Liability Net
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Arising through business
combinations 2,481 2,481 2,839 2,839
Accelerated capital allowances (142) (142) (142) (142)
Available losses 142 142 142 142
------- --------- ------- ------- --------- -------
Tax asset/(liabilities) 2,623 (142) 2,481 2,981 (142) 2,839
------- --------- ------- ------- --------- -------
9. LOSS PER SHARE
2021 2020
GBP'000 GBP'000
Numerator
Loss for the year after tax and loss used in
basic and diluted EPS (3,531) (2,227)
Denominator
Weighted average number of shares used in basic
and diluted EPS 198,435,537 184,051,542
Loss per share - basic and diluted (1.8p) (1.2p)
The outstanding share options calculation are antidilutive, due
to loss made in the year.
10. PROPERTY, PLANT AND EQUIPMENT
Leasehold Plant and Fixtures Total
Improvements Machinery and Fittings
GBP'000 GBP'000 GBP'000 GBP'000
Cost
At 1 January 2020 124 340 74 538
Additions - 66 - 66
Disposals - (150) - (150)
------------- ---------- ------------- -------
At 31 December 2020 124 256 74 454
Additions 33 95 - 128
Disposals - (3) - (3)
Foreign exchange - (11) - (11)
------------- ---------- ------------- -------
At 31 December 2021 157 337 74 568
Depreciation
At 1 January 2020 15 185 20 220
Charge for the year 21 94 24 139
Disposals - (148) - (148)
At 31 December 2020 36 131 44 211
Charge for the year 36 82 24 142
Disposals - (2) - (2)
Foreign exchange - (3) - (3)
------------- ---------- ------------- -------
At 31 December 2021 72 208 68 348
Net Book Value
At 1 January 2020 109 155 54 318
At 31 December 2020 88 125 30 243
At 31 December 2021 85 129 6 220
11. RIGHT OF USE ASSETS AND LEASE LIABILITIES
Amounts recognised on the statement Leasehold Total
of financial position Properties
GBP'000 GBP'000
Cost
At 1 January 2020 1,820 1,820
Additions - -
Remeasurement of lease 293 293
At 31 December 2020 2,113 2,113
Additions 85 85
Remeasurement of lease 535 535
----------- -----------------------
At 31 December 2021 2,733 2,733
Depreciation
At 1 January 2020 466 466
Charge for the year 574 574
----------- -----------------------
At 31 December 2020 1,040 1,040
Charge for the year 522 522
----------- -----------------------
At 31 December 2021 1,562 1,562
Net Book Value
At 1 January 2020 1,354 1,354
At 31 December 2020 1,073 1,073
At 31 December 2021 1,171 1,171
The Group lease various offices. Rental contracts are typically
made for fixed periods between 12 months and 6 years but may have
extension options as well as leases that include rolling
contractual periods when the existing lease expires these are
described below. Rental contracts are signed at a fixed price
however some have variable increases which are linked to RPI.
Extension and termination options are included in some of the
property leases across the group. These are used to maximise
operational flexibility in terms of managing assets used in the
Group's operations including variable increases to the rental
amounts. In determining the lease term, management considers all
facts and circumstances that create an economic incentive to
exercise and option, or not exercise the option. Extension options
are only included in the lease term if the lease is reasonably
certain to be extended. Management have determined that termination
option for the London office will not be exercised .
The following property leases were modified due to extension
terms agreed: in April 2021 Fredhopper BV renewed the lease for a
period of 12 months and Attraqt Limited entered into a 2 year lease
for an office in Chertsey. A remeasurement was completed for the
Netherlands and Paris leases which are assumed to renew for an
additional year when the leases end during 2022.
Amounts recognised in the statement 2021 2020
of profit or loss
GBP'000 GBP'000
Amortisation 522 574
Interest expense 66 61
Expenses relating to short term leases
and low value assets 56 100
------- -------
644 735
Total cash outflow for lease in 2021 540 626
Lease liability recognised as at 31 2021 2020
December
Of these which are: GBP'000 GBP'000
Current lease liabilities 614 416
Non-current lease liabilities 686 738
1,300 1,154
11. RIGHT OF USE ASSETS AND LEASE LIABILITIES continued
The total future value of minimum short term and low value
operating lease payments is due as follows:
2021 2020
GBP'000 GBP'000
Not later than one year 35 40
Later than one year and not later than five years 1 3
36 43
12. INTANGIBLE ASSETS
Customer Existing Software
Goodwill Relationships Technology Trademark Development Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Cost
At 1 January 2020 25,649 6,709 8,685 1,136 4,223 46,402
Additions - internally
developed - - - - 1,341 1,341
Acquired through asset
purchase - - 1,826 - - 1,826
Foreign Exchange - 39 - - 95 134
---------- -------------- ----------- ----------- ------------ -------
At 31 December 2020 25,649 6,748 10,511 1,136 5,659 49,703
Additions - internally
developed - - - - 2,025 2,025
Acquired through asset
purchase - - 2,179 - - 2,179
Foreign Exchange - (49) - - (245) (294)
At 31 December 2021 25,649 6,699 12,690 1,136 7,439 53,613
Amortisation
At 1 January 2020 - 1,283 2,157 242 2,566 6,248
Charge for the period - 659 1,113 114 931 2,817
Foreign Exchange - 14 - - 39 53
---------- -------------- ----------- ----------- ------------ -------
At 31 December 2020 - 1,956 3,270 356 3,536 9,118
Charge for the period - 656 1,355 114 1,329 3,454
Foreign Exchange - (22) - - (148) (170)
---------- -------------- ----------- ----------- ------------ -------
At 31 December 2021 - 2,590 4,625 470 4,717 12,402
Net Book Value
At 1 January 2020 25,649 5,426 6,528 894 1,657 40,154
At 31 December 2020 25,649 4,792 7,241 780 2,123 40,585
At 31 December 2021 25,649 4,109 8,065 666 2,722 41,211
The net book value and expiry dates for the most significant
intangibles are as follows:
Expiry Expiry Expiry Early Fredhopper Aleph Early Fredhopper Aleph Aleph
Fredhopper Early Aleph Birds BV Net Birds BV Net Net Net
BV Birds SAS Net Net book book SAS Net book book book
SAS book value value book value value value
value value
2021 2021 2021 2020 2020 2020 2020
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Customer
relationships 2028 2028 - 1,636 2,395 - 1,891 2,796 - -
Existing
technology 2024 2029 2030 2,878 1,500 3,687 3,267 2,186 1,804 1,804
Trademark 2027 2029 - 258 408 - 293 487 - -
12. INTANGIBLE ASSETS
The Group is required to test, on an annual basis, whether
goodwill has suffered any impairment. There is only one CGU as
services are tied to SaaS revenue. The recoverable amount is
determined based on value in use calculations. The use of this
method requires the estimation of future cash flows and the
determination of a discount rate in order to calculate the present
value of the cash flows.
The carrying amount of goodwill is allocated to the cash
generating units (CGUs) as follows:
2021 2020
GBP'000 GBP'000
Attraqt Group plc 25,649 25,649
The key assumptions used in the estimation of the recoverable
amounts are set out below. The values assigned to the key
assumptions represent management's assessment of future trends in
the relevant industries and have been based on historical internal
data:
2021 2020
Discount rate 12.25% 12.25%
Revenue growth rate 13% 14%
Budgeted EBITDA margin (average growth
over next 5 years) 16.7% 14%
Terminal growth rate 5% 5%
The cash flow projections include specific estimates for 5 years
and a terminal growth rate thereafter. The terminal growth rate was
determined based on long term inflation growth rate due to the
expectations of the market in which Attraqt Group plc operates.
The discount rate was a post-tax measure based on weighted
average cost of capital.
Budgeted EBITDA is estimated by taking into account past
practice as follows:
o Revenue is assumed to grow at 13% based on historical growth
and management's expectations of future trends.
o The cost base is assumed to grow at an average rate 10% over
the next three years, this is non consistent rate of growth.
Management has identified that a reasonably possible change in
the following key assumptions could cause the carrying amount to
exceed the recoverable amount. The following table shows the amount
by which the these assumptions would need to change individually
for the estimated recoverable amount to be equal to the carrying
amount.
In percent 2021 2020
Revenue growth rate* (6.3) (5.1)
*assumes that the variable costs base associated with cost of
sales reduces in line with revenue reduction as the cost base is
driven by customer usage.
13. SUBSIDIARY UNDERTAKINGS
As at 31 December 2021, the subsidiaries of Attraqt Group plc,
all of which have been included in these consolidated financial
statements, are as follows:
Proportion Country of
of ownership Incorporation
Name Interest and principal Registered Office
place of business
Attraqt Limited 100% UK 7(th) Floor, 222-236 Gray's
Inn Road, London, WC1X 8HB
Attraqt Inc. (1) 100% USA 330 N Wabash Ave, Chicago,
IL 60611, USA
Early Birds SAS 100% France 36 rue Scheffer, 75116, Paris,
France
Fredhopper BV 100% Netherlands Wework Metropool, Weesperstraat,
61-105 Amsterdam 1018VN
Spring Technologies 100% Bulgaria 1000 Sofia city, Sredec district,,
EOOD(2) 47A, Tsarigradskok shosse blvd,
bl. B, fl. 2, apt. 201A
Fredhopper SARL(2) 100% France 36 rue Scheffer, 75116, Paris,
France
Fredhopper GmbH(2) 100% Germany Neuer Wall 50, 20354 Hamburg,
Germany
Fredhopper (Australia) 100% Australia Level 19, 207 Kent St, Sydney
Pty Limited(2) NSW 2000
FCLS RM 7 Limited 100% UK 7(th) Floor, 222-236 Gray's
(dormant) Inn Road, London, WC1X 8HB
1 - Held through Attraqt Limited
2 - Held through Fredhopper BV
The principal activity of all companies with the Group is the
provision of software as a service, with the exception of FCLS RM 7
Limited which is a holding company and is dormant.
14. TRADE AND OTHER RECEIVABLES
2021 2020
GBP'000 GBP'000
Trade receivables 3,996 4,215
Less: expected credit losses (206) (142)
------- -------
Trade receivables - net 3,790 4,073
Prepayments and accrued income 2,034 1,829
Other receivables 202 253
---------------------------------- ------- -------
Total trade and other receivables 6,026 6,155
Trade receivables comprise amounts due from customers for goods
sold or services performed in the ordinary course of business.
Invoices to customers are settled within 30 - 90 day credit terms
with the average being 45 days after the date of issue. The ageing
of trade receivables is shown below and shows amounts that are
current and past due at the reporting date. A provision for
expected credit losses has been recognised at the reporting date
through consideration of the ageing profile of the Group's
receivables and the perceived credit quality of its customers.
The Group applies the IFRS 9 simplified approach to measuring
expected credit losses using lifetime expected loss rates, these
have been derived from historical default rates of the Group,
adjusted for credit quality of each customer and forward looking
estimates including consideration for the risk of a downturn in the
high street.
Expected credit losses
The lifetime expected loss provision for the trade receivables
is as follows:
31 December 2021 Current Up to 30 days old More than 30 days More than 60 days More than 120 days Total
old old old
Expected loss rate 0.5% 3% 4% 9% 20%
Gross carrying
amount 2,899 721 151 27 46 3,844
Loss provision 14 22 6 2 10 54
Gross carrying
amount for lifetime
credit loss - - - - 152 152
Loss provision for
lifetime credit
loss - - - - 152 152
------- ----------------- ------------------- ------------------- ------------------- -----
Total loss provision 14 22 6 2 162 206
31 December 2020 Current Up to 30 days old More than 30 days More than 60 days More than 120 days Total
old old old
Expected loss rate 0.5% 3% 4% 9% 20%
Gross carrying
amount 3,547 272 11 96 216 4,142
Loss provision 18 5 - 9 44 76
Gross carrying
amount for lifetime
credit loss - - - - 66 66
Loss provision for
lifetime credit
loss - - - - 66 66
------- ----------------- ------------------- ------------------- ------------------- -----
Loss provision 18 5 - 9 110 142
At 31 December 2021 trade receivables of GBP152,000 (2020:
GBP66,000) had life time expected credit losses of the full value
of the receivables. All other trade receivables have been
calculated on a 12 month expected credit loss rate.
2021 2020
GBP'000 GBP'000
As at 1 January 142 95
Write off (15) (23)
Recognised 68 88
FX movement 11 (18)
As at 31 December 206 142
15. CASH AND CASH EQUIVALENTS
2021 2020
GBP'000 GBP'000
Cash at bank 3,566 6,672
Bank loan (51) (81)
------- -------
3,515 6,591
------- -------
The Group acquired the bank loan as part of the Early Birds
acquisition, the terms of loan are interest free and is repayable
over five years.
16. SHARE CAPITAL AND RESERVES
Allocated, called up and fully paid
2021 2021 2021 2020 2020 2020
GBP'000 GBP'000 GBP'000 GBP'000
Number Share Share Number Share Share
of Shares capital Premium of Shares capital Premium
Ordinary shares of GBP0.01
each
At 1 January 196,149,171 1,961 53,251 180,048,207 1,800 48,516
Shares issued for cash
during the year 12,500,000 125 3,619
Shares issued to sellers
as part of asset purchase
during the year 5,401,446 55 2,229 3,600,964 36 1,116
----------- -------- -------- ----------- -------- --------
At 31 December 201,550,617 2,016 55,480 196,149,171 1,961 53,251
=========== ======== ======== =========== ======== ========
The Company issued 5,131,374 1p Ordinary shares at 42.5p on 26
July 2021 which related to 95% of the unpaid deferred consideration
to the sellers for the asset purchase of the Aleph software. The
Company issued 270,072 1p Ordinary shares at 37.50p on 7 October
2021 which was the remaining 5% of the deferred consideration to
the sellers for the purchase of the Aleph software. The Company has
a total of 201,550,617 ordinary shares in issue, all of which have
voting rights. In 2020 Company raised GBP4,000,000 before expenses,
by private placing of 12,500,000 1p Ordinary shares at 32p on 1
October 2020. 3,600,964 Ordinary shares were issued to the sellers
as consideration for the asset purchase of the Aleph software.
The following describes the nature and purpose of each reserve
within equity:
Reserve Description and purpose
Share premium Amount subscribed for share capital in excess
of nominal value.
Share based payment reserve The share based payment reserve represents
equity settled share based employee remuneration
until such share options are exercised and
contingent shares.
Merger reserve The merger reserve results from the application
of merger accounting on the merger of Attraqt
Inc and Attraqt Limited.
Retained earnings All other net gains and losses and transactions
with owners (e.g. dividends) not recognised
elsewhere.
--------------------------- -------------------------------------------------
17. SHARE BASED PAYMENTS
The company operates two equity-settled share based remuneration
schemes for employees: a United Kingdom tax authority approved
scheme and an unapproved scheme for executive directors and certain
senior management. The scheme expired for new awards to management
level and above in 2021 but existing grants will remain protected.
Both options are valid for 10 years from the date of grant. After
satisfaction of any performance condition included in the award the
options will become exercisable on the earlier of any of the
following events:
-- The third anniversary of the date of grant (with the exception of the below);
-- 2,250,000 shares granted on 5(th) August 2020 vest 25% per annum over 4 years;
-- Shares granted on 10th July vested immediately;
-- On a change of Control of the Company as defined in the Plan rules;
-- On a Sale or Disposal of the Company as defined in the Plan rules; or
-- Following the exercise of discretion by the Board.
The company has replaced the unapproved scheme for executive
directors and certain senior management with a long term incentive
plan (LTIP) for management level based on proposed performance
conditions which are more closely aligned with the strategy and
objectives of the business. These LTIPs are exercisable at nil cost
to the individual (with the exception of the 1p nominal value of
each share awarded). This will be an annual award. After
satisfaction of any performance condition included in the award the
options will become exercisable on the earlier of any of the
following events:
-- The third anniversary of the date of grant (with the exception of the below); or
-- On a change of Control of the Company as defined in the Plan rules; or
-- On a Sale or Disposal of the Company as defined in the Plan rules; or
-- Following the exercise of discretion by the Board.
17. SHARE BASED PAYMENTS continued
Details of the number of share options and the weighted average
exercise price outstanding during the year are as follows:
2021 WAEP 2020 WAEP
Number Price Number Price
(pence) (pence)
Outstanding at the beginning of the
year 13,229,991 32.59 12,607,818 31.67
Granted during the year 2,669,000 4.87 3,710,000 27.37
Forfeited during the year (905,490) 37.02 (3,087,827) 33.49
Outstanding at the end of the year 14,993,501 26.98 13,229,991 32.59
Exercisable at the year end 6,545,817 34.52 4,948,806 36.57
CSOP Nil cost Total
options
2021 WAEP Number Price (pence) Number Price (pence) Number Price (pence)
Outstanding at the
beginning of the year 13,229,991 32.59 - - 13,229,991 32.59
Granted during the
year 255,000 41.50 2,414,000 1.00 2,669,000 4.87
Forfeited during the
year (805,490) 41.50 (100,000) 1.00 (905,490) 37.02
Outstanding at the
year end 12,679,501 31.72 2,314,000 1.00 14,993,501 26.98
Exercisable at the
year end 6,545,817 34.52 - - 6,545,817 34.52
---------- --------- ----------
No options were exercised during the year.
The company uses a Black Scholes model for grants issued with a
share price performance criteria for employees and those grants for
executive directors and certain senior management prior to 2021. A
Monte Carlo model is used to estimate the fair value of the
performance share options granted in 2021.
The following information is relevant in the determination of
the fair value of options granted using the Black Scholes model.
The assumptions inherent in the use of this model are as
follows:
-- The option life is the estimated average period over which the options will be exercised.
-- No variables change during the life of the option (e.g. dividend yield remains zero).
-- Volatility has been calculated over a 6 year period prior to the grant date.
-- Expectations of staff retention of 10% over the vesting
period have been added into the calculation.
The following information is relevant in the determination of
the fair value of options granted using the Monte Carlo model. The
assumptions inherent in the use of this model are as follows:
-- The option life is the estimated average period over which the options will be exercised.
-- No variables change during the life of the option (e.g. dividend yield remains zero).
-- Volatility has been calculated over a 3 year period prior to the grant date.
-- Expectations of staff retention of 10% over the vesting
period have been added into the calculation.
Details of the share options granted as follows:
Grant date 22-Apr-21 22-Apr-21 22-Apr-21
Option pricing model Black Scholes Monte Carlo Probability
Number of shares 255,000 1,207,000 1,207,000
Share price on grant date 41.50p 41.50p 41.50p
Exercise price (GBP) 41.50p 1.00p 1.00p
Weighted average contractual life 6 years 3 years 3 years
Staff retention rate 10% 10% 10%
Risk-free interest rate 0.07% 0.13% 0.07%
Volatility 29.73% 27.20% 30.04%
Probability of revenue achievement - - 70%
Total Fair Value (GBP) 27,214 107,109 307,966
The total expense recognised during the year by the Group, for
all schemes, was GBP215,000 (2020: GBP59,000) net of forfeitures.
The weighted average remaining life of the options outstanding at
the end of the year was 7.3 years (2020: 7.8 years). No options
were exercised during the year.
18. TRADE AND OTHER PAYABLES
2021 2020
GBP'000 GBP'000
Trade payables 1,659 1,268
Accrued and other payables 585 1,460
Bank loan 26 450
Lease liability (note 11) 614 416
Other taxes 117 741
Contract liability 5,795 5,545
Employee benefits 753 1,334
Employee taxes 531 453
------------------------------- ------- -------
Total Trade and other payables 10,080 11,667
------------------------------- ------- -------
The bank loan has restrictions on sale of assets without prior
agreement, whereby we would need to seek approval if we were to
sell assets of Early Birds SAS that are greater than 50% of gross
assets.
19. FINANCIAL RISK MANAGEMENT AND IMPAIRMENT OF FINANCIAL ASSETS
The Group is exposed through its operations to the following
financial risks:
-- Credit risk
-- Foreign exchange risk
-- Liquidity risk
In common with all other businesses, the Group is exposed to
risks that arise from its use of financial instruments. This note
describes the Group's objectives, policies and processes for
managing those risks and the methods used to measure them. Further
quantitative information in respect of these risks is presented
throughout these financial statements.
There have been no substantive changes in the Group's exposure
to financial instrument risks, its objectives, policies and
processes for managing those risks or the methods used to measure
them from previous periods unless otherwise stated in this
note.
Principal financial instruments
The principal financial instruments used by the Group, from
which financial instrument risk arises, are as follows:
-- Trade receivables
-- Cash and cash equivalents
-- Trade and other payables
A summary of the financial instruments held by category is
provided below.
Financial assets at amortised cost 2021 2020
Current GBP'000 GBP'000
Trade receivables 3,790 4,073
Accrued income 337 189
Other receivables 202 253
4,329 4,515
----------------------------------- ------- -------
Cash and cash equivalents 3,515 6,591
All financial assets held by the Group at 31 December 2021 are
classified as cash and cash equivalents or financial assets at
amortised cost and there is no difference between the carrying
amount and the fair value.
Financial liabilities at amortised cost 2021 2020
GBP'000 GBP'000
Trade payables 1,659 1,268
Accrued and other payables 585 1,460
Lease liabilities 1,300 1,154
Bank loan 420 450
Employee benefits 753 1,334
4,717 5,666
---------------------------------------- ------- -------
All financial liabilities held by the Group at 31 December 2021
are classified as held at amortised cost.
19. FINANCIAL RISK MANAGEMENT AND IMPAIRMENT OF FINANCIAL ASSETS continued
General objectives, policies and processes
The Board has overall responsibility for the determination of
the Group's risk management objectives and policies and, whilst
retaining ultimate responsibility for them, it has delegated the
authority for designing and operating processes that ensure the
effective implementation of the objectives and policies to the
Company's Chief Executive Officer. The Board receives reports from
the Chief Financial Officer through which reviews the effectiveness
of the processes put in place and the appropriateness of the
objectives and policies it sets.
The overall objective of the Board is to set policies that seek
to reduce risk as far as possible without unduly affecting the
Group's competitiveness and flexibility.
Further details regarding these policies are set out below:
Credit risk
Credit risk is the risk of financial loss to the Group if a
customer or counterparty to a financial instrument fails to meet
its contractual obligations. The Group is mainly exposed to credit
risk from credit sales. It is Group policy, implemented locally, to
assess the credit risk of new customers before entering contracts.
Such credit ratings take into account local business practices. The
carrying amount of financial assets represents the maximum
exposure. The credit quality of all financial assets that are
neither past due nor impaired is high. In accordance with internal
policy, Attraqt promptly identifies the deterioration of the
financial condition for our customer base by monitoring the credit
ratings and publicly available information. The risk is not
expected to be material as payment is generally received in advance
of services and good provided.
The Group considered if that there was an impairment if any of
the following indicators were present:
-- Significant financial difficulties of the debtor;
-- Probability that the debtor will enter bankruptcy or financial reorganisation; and
-- Default or late payments (more than 30 days past payment due date).
Receivables for which an impairment provision was recognised was
written off against the provision when there was no expectation of
recovering additional cash.
Credit risk also arises from cash and cash equivalents and
deposits with banks and financial institutions. For banks and
financial institutions, only independently rated parties with
minimum rating "A" are accepted.
Further disclosures regarding trade and other receivables are
provided in note 14.
Foreign exchange risk
Foreign exchange risk arises when the group entities enter into
transactions denominated in a currency other than the functional
currency. The Group's policy is, where possible, to allow entities
to settle liabilities denominated in their functional currency with
the cash generated from their own operations in that currency.
In order to monitor the continuing effectiveness of this policy,
the CFO reviews a monthly forecast, analysed by the major
currencies held by the Group, of liabilities due for settlement and
expected cash reserves.
Transaction risk
The Group's material transaction exposure arises on costs
denominated in currencies other than the functional currency of the
Group, including salaries and our hosting platform. This has been
mitigated as far as possible by matching revenue and costs with the
respective currencies in each of the subsidiaries locations
resulting in an immaterial foreign currency risk at an entity
level. Foreign currencies are not hedged.
Market risk
Attraqt Group's customers are mainly in the retail sector which
has been buoyant during the pandemic with a move towards more
online sales. The Group is looking to further diversify into
adjacent vertical markets such as DIY, Health & Beauty and
Business to Business to mitigate the exposure to any changes in the
retail sector.
Liquidity risk
Liquidity risk arises from the Group's management of working
capital. The Group manages the risk that it will encounter
difficulty in meeting its financial obligations as they fall due by
forecasting its short-term cash position on a regular basis.
The Group's policy is to ensure that it will always have
sufficient cash to allow it to meet its liabilities when they
become due. To achieve this aim, it seeks to maintain cash balances
(or agreed facilities) to meet expected requirements for a period
of at least 30 days.
The Board receives rolling 12-month cash flow projections on a
quarterly basis as well as information regarding cash balances. At
the end of the financial year, these projections indicated that the
Group expected to have sufficient liquid resources to meet its
obligations under all reasonably expected circumstances.
In the management of liquidity risk, the group monitors and
tries to maintain a level of cash and cash equivalents deemed
adequate by management to finance the Group's operations and
mitigate the effects of fluctuations in cash flows.
The following table sets out the contractual maturities
(representing undiscounted contractual cash-flows) of financial
liabilities:
2021 GBP'000 Up to 3 - 12 1 - 2 2 - 5 Over 5
3 months months years years years
Trade payables and employee
benefits 2,412 - - - -
Accruals and other payables 585 - - - -
Bank loan - 26 84 252 58
Lease liabilities 179 538 521 403 -
3,176 564 605 655 58
---------------------------- --------- ------- ------ ------ ------
2020 GBP'000 Up to 3 - 12 1 - 2 2 - 5 Over 5
3 months months years years years
Trade payables and employee
benefits 2,602 - - - -
Accruals and other payables 1,460 - - - -
Bank loan - 28 90 270 62
Lease liabilities 184 552 382 485 81
4,246 580 472 755 143
---------------------------- --------- ------- ------ ------ ------
Capital management
The Group's objective is to maintain an appropriate balance of
debt and equity financing to enable the Group to continue as a
going concern, to
continue the future development of the business and to optimise
returns to shareholders and benefits to other stakeholders.
The Board closely manages trading capital, defined as net assets
plus net debt. The Group's net assets at 31 December 2021 were
GBP38.3 million
(2020: GBP39.7 million) and net debt, calculated as total debt
(comprising bank loans), less cash and cash equivalents amounted to
GBP3.5 million (2020: GBP6.1 million).
In 2020, the Group issued shares via a fund raise of
GBP4,000,000 to purchase the Aleph Search software and a subsidiary
was granted a loan of GBP450,000 in 2020. This bank loan is payable
over a five year period with a pandemic delayed start date of
October 2022.
Major investment decisions are based on reviewing the expected
future cash flows and all major capital expenditure requires
approval by the Board.
20. RELATED PARTY TRANSACTIONS
During the year Group companies entered into the following
transactions with related parties who are not members of the
Group.
Purchase of services Amounts owed to related parties
2021 2020 2021 2020
GBP'000 GBP'000 GBP'000 GBP'000
Azini Capital Partners(1) 69 70 - 20
Taylor Wessing(2) 43 40 - -
Taylor Wessing(3) 27 213 - -
-------------------------- ---------- ---------- ---------------- ---------------
1. Azini Capital Partners - Nick Habgood is a partner in Azini
Capital Partners, and his Directors fees were paid to Azini
Capital.
2. Robert Fenner is a partner in Taylor Wessing LLP, and his
Directors fees were paid to Taylor Wessing LLP.
3. During the current year Taylor Wessing provided various legal
and professional fees, in the prior period, the fees were in
relation to the Fund raising and asset purchase of Aleph
software.
Details of the directors' emoluments, together with the other
related information, are set out in the Report of the Remuneration
Committee.
Key Management personnel
Key management personnel are those persons having authority and
responsibility for planning, directing and controlling activities
of the Group, which comprises only the directors of the
company.
2021 2020
GBP'000 GBP'000
Salary, Director fees, bonus and benefits in kind 694 750
Employers National Insurance 63 79
Pension 13 13
Share based payments 215 (4)
985 838
Further information about the remuneration of individual
Directors is provided in the Directors remuneration report..
21. CAPITAL COMMITMENTS
There were no capital commitments in 2021.
COMPANY STATEMENT OF FINANCIAL POSITION
For the year ended 31 December 2021
Notes 2021 2020
GBP'000 GBP'000
Non-current assets
Investments 2 43,385 40,991
Amounts owed by group undertakings 7 11,462 12,343
Total non-current assets 54,847 53,334
----------------------------------- ------ ------- -------
Current assets
Trade and other receivables 3 194 332
Total current assets 194 332
----------------------------------- ------ ------- -------
Total assets 55,041 53,666
----------------------------------- ------ ------- -------
Current Liabilities
Trade and other payables 4 113 609
Total current liabilities 113 609
----------------------------------- ------ ------- -------
Net Assets 54,928 53,057
Equity
Share capital 5 2,016 1,961
Share premium 5 55,480 53,251
Share based payment 6 1,697 1,585
Accumulated deficit (4,265) (3,740)
----------------------------------- ------ ------- -------
Total equity 54,928 53,057
COMPANY STATEMENT OF CHANGES IN EQUITY
For the year ended 31 December 2021
Note Share Share Share Retained Total
Capital premium based earnings
payment
reserve
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 1 January 2020 1,800 48,516 1,423 (3,845) 47,894
Profit for the year - - - 105 105
Total comprehensive profit for the
year - - - 105 105
--------- -------
Contributions by and distributions
to owners
Shares issued 5 161 4,991 - - 5,152
Issue costs 5 - (256) - - (256)
Share based payment charge 6 - - 59 - 59
Contingent shares to be issued - - 103 - 103
---- -------- -------- -------- --------- -------
Total contributions by and distributions
to owners 161 4,735 162 - 5,058
----------------------------------------- ---- -------- -------- -------- --------- -------
Balance at 31 December 2020 1,961 53,251 1,585 (3,740) 53,057
----------------------------------------- ---- -------- -------- -------- --------- -------
(Loss) for the year - - - (525) (525)
Total comprehensive (loss) for the
year - - - (525) (525)
----------------------------------------- ---- -------- -------- -------- --------- -------
Contributions by and distributions
to owners
Shares issued 5 55 2,229 - - 2,284
Share based payment charge 6 - - 215 - 215
Contingent shares to be issued - (103) - (103)
Total contributions by and distributions
to owners 55 2,229 112 - 2,396
----------------------------------------- ---- -------- -------- -------- --------- -------
Balance at 31 December 2021 2,016 55,480 1,697 (4,265) 54,928
----------------------------------------- ---- -------- -------- -------- --------- -------
The following describes the nature and purpose of each reserve
within equity:
Reserve Description and purpose
Share premium Amount subscribed for share capital in excess
of nominal value.
Share based payment reserve The share based payment reserve represents
equity settled share based employee remuneration
until such share options are exercised.
Retained earnings All other net gains and losses and transactions
with owners (e.g. dividends) not recognised
elsewhere.
--------------------------- -------------------------------------------------
NOTES TO THE COMPANY FINANCIAL STATEMENTS
For the year ended 31 December 2021
1. ACCOUNTING POLICIES
Basis of preparation
The company financial statements have been prepared in
accordance with Financial Reporting Standard 100 Application of
Financial Reporting Requirements and Financial Reporting Standard
101 Reduced Disclosure Framework.
The principal accounting policies adopted in the preparation of
the financial statements are set out below. The policies have been
consistently applied to all the years presented, unless otherwise
stated.
The Company applies consistent accounting policies, as applied
by the Group with the exception of the below. To the extent that an
accounting policy is relevant to the Group and the Company
financial statements, refer to the Group financial statements for
disclosure of the accounting policy.
The financial statements have been prepared under the historical
cost convention and are in accordance with applicable accounting
standards. The following principal accounting policies have been
applied.
Disclosure exemptions adopted
In preparing these financial statements the company has taken
advantage of all disclosure exemptions conferred by FRS 101.
Therefore, these financial statements do not include:
-- certain comparative information as otherwise required by UK endorsed IFRS;
-- certain disclosures regarding the company's capital;
-- a statement of cash flows;
-- the effect of future accounting standards not yet adopted;
-- share-based payments;
-- the disclosure of the remuneration of key management personnel; and
-- disclosure of related party transactions with other wholly
owned members of the group headed by Attraqt Group plc.
Investments
The Company's investments are carried at cost less provisions
resulting from impairment. In testing for impairment, the carrying
value of the investment is compared to is recoverable amount, which
is its value in use.
ACCOUNTING JUDGEMENTS AND ESTIMATES
In the application of the Company's accounting policies, the
Directors are required to make judgements and estimates about the
carrying amounts of assets and liabilities that are not readily
apparent from other sources. The estimates and associated
assumptions are based on historical experience and other factors
that are considered to be relevant. Actual results may differ from
these estimates. There were no material judgements or estimates
used on application of IFRS 9 Financial Instruments or IFRS 15
Revenue from contracts with customers, there were no contracts that
straddled year end which required any judgement. The following
accounting policies have been identified as involving particularly
complex judgements or subjective estimates:
Estimates
-- Share based payments
Please refer to note 3 and note 17 of the Consolidated Financial
Statements.
-- Investments
The Company's investments in subsidiaries are carried at cost
less provisions resulting from impairment. Where there are
indicators of impairment, the carrying value of the investment is
compared to its recoverable amount, being its value-in-use (Note
2).
-- Intercompany receivables
The Company's intercompany receivable balance is carried at
amortised cost less provision for expected credit losses,
management have assessed the probability of default to estimate the
impact of credit loss (Note 7).
2. INVESTMENTS
2021 2020
GBP'000 GBP'000
As at 1 January 40,991 39,105
Additions 2,394 1,886
As at 31 December 43,385 40,991
As at 31 December 2021, the subsidiaries of Attraqt Group plc,
are shown in note 13 of the Consolidated Group financial
statements.
The Company's investment in subsidiaries have been tested for
impairment by comparison against the underlying value of the
subsidiaries' assets based on value in use calculated using the
same assumptions as noted for the testing of goodwill impairment in
note 12 of the Group financial statements.
3. TRADE AND OTHER RECEIVABLES
2021 2020
GBP'000 GBP'000
Prepayments 77 115
Trade receivables - 106
VAT 117 111
194 332
The fair values of trade and other receivables are not
materially different to their carrying values.
4. TRADE AND OTHER PAYABLES
2021 2020
GBP'000 GBP'000
Trade payables 79 133
Other payables - 350
Deferred income - 81
Accruals 34 45
113 609
All financial liabilities held by the Company at the end of the
reporting period are classified as held at amortised cost.
5. SHARE CAPITAL
Allocated, called up and fully paid
2021 2021 2021 2020 2020 2020
GBP'000 GBP'000 GBP'000 GBP'000
Number of Shares Share capital Share Premium Number of Shares Share capital Share Premium
Ordinary shares of
GBP0.01 each
At 1 January 196,149,171 1,961 53,251 180,048,207 1,800 48,516
Shares issued for cash
during the year - - - 12,500,000 125 3,619
Shares issued to
sellers as part of
asset purchase during
the year 5,401,446 55 2,229 3,600,964 36 1,116
---------------- ------------- ------------- ---------------- ------------- -------------
At 31 December 201,550,617 2,016 55,480 196,149,171 1,961 53,251
================ ============= ============= ================ ============= =============
The Company issued 5,131,374 1p Ordinary shares at 42.5p on 26
July 2021 which related to 95% of the unpaid deferred consideration
to the sellers for the asset purchase of the Aleph software. The
Company issued 270,072 1p Ordinary shares at 37.50p on 7 October
2021 which was the remaining 5% of the deferred consideration to
the sellers for the purchase of the Aleph software. The Company has
a total of 201,550,617 ordinary shares in issue, all of which have
voting rights. In 2020 Company raised GBP4,000,000 before expenses,
by private placing of 12,500,000 1p Ordinary shares at 32p on 1
October 2020. 3,600,964 Ordinary shares were issued to the sellers
as consideration for the asset purchase of the Aleph software.
.
6. SHARE BASED PAYMENTS
For details of the share based payments please refer to the
Group note 17.
7. FINANCIAL INSTRUMENTS
2021 2020
GBP'000 GBP'000
Trade and intercompany receivables 11,462 12,449
---------------------------------------- ------- -------
Financial assets at amortised cost 11,462 12,449
Trade and other payables 81 528
Financial liabilities at amortised cost 81 528
Intercompany receivables have been assessed and it has been
considered no entity requires a loss allowance based on a review of
future cash flows over the next 5 years, the risk of default is
considered to be negligible an no allowance has been recognised
against this balance (2020: nil).
Amounts owed from intercompany balances bear interest at 0.01%
per annum (2020: 0.01%). The balances are unsecured and repayable
on demand, the Company does not intend to request repayment of
these balances and therefore these have been classified as
non-current.
8. EMPLOYEES
The company had no employees during the year (2020: none)
excluding directors. Further information about the remuneration of
the directors is provided in the remuneration report .
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