31 July 2023
Everest
Global plc
(“Everest”
or the “Company”)
Unaudited
interim results for the six months ended 30
April 2023
The Board
of Everest is pleased to announce its unaudited results for the six
months ended 30 April
2023.
Chief
Executive Officer’s Report
I am
pleased to report our unaudited results for the six months ended
30 April 2023.
To repeat
for those new to the Company, on 3 October
2022, prior to the previous year-end, the Company announced
a number of important events including the recapitalisation of the
Company through a subscription by Golden Nice International Limited
of 13 million new Ordinary Shares in the Company for £650,000 and
its
purchase
of 65% of the outstanding convertible loan notes, with the
remainder of the convertible loan notes (35%) being converted by
the note holders into Ordinary Shares in the Company.. The Company
also changed its name to Everest Global Plc, both Andrew Monk and Matt
Bonner resigned from the Board and Simon Grant-Rennick and I were appointed to the
Board. .
During the
current reporting period, on the 24 January
2023, the Company announced a subscription for 12,726,000
new Ordinary Shares raising net proceeds totalling £699,930 at a
subscription price of 5.5 pence per
Ordinary Share. In addition, on 25 January
2023, the convertible loan note holder, Golden Nice
International Limited converted £300,000 of its debt to 6,000,000
new Ordinary Shares.
Due to the
number of new shares issued in the period under review and on
3 October 2022, in order to comply
with Prospectus Regulation Rule 1.2.4, which prohibits the
admission of more than 20% of the number of securities already
admitted to trading on the Main Market of the London Stock Exchange
without a prospectus, the Company is working towards publishing a
prospectus in relation to the issue of the these shares, by
2 October 2023, in order to enable
them to be admitted to trading on the Main Market of the London
Stock Exchange in accordance with Listing Rule 14.3.4.
This has
been the first reporting period that the Company is operating as
Everest Global Plc with the new reconstituted board for the full
period and I am pleased to announce that the board is working very
well together despite the head winds. The board is clear on its
mandate and strategy and is working towards achieving
this.
Post
period end, the Company announced on the 4
July 2023, that it had invested £200,000 by way of a loan
into Precious Link (UK) Limited, a
wine retailer, located within the Southeast of England. The Board believes that Precious Link operates in a complementary sector
and that the loan could assist the Company in expanding its
activities into the wider food and beverage sector.
As
mentioned in the Annual Financial Statements for the year ended
31 October 2022, and simultaneous to
the investment by Golden Nice International Limited, Dynamic
Intertrade (Pty) Limited (“Dynamic”) issued shares to K2 Spice
Limited (previously VSA NEX Investments Limited) (“K2”), for
consideration of ZAR10,982, such that
Everest Global retains 51% interest in Dynamic and K2 now holds 49%
of Dynamic. Further, the Company granted K2 a put option for £1 to
acquire the remaining 51% once certain conditions have been met. In
addition, certain debts owing by Dynamic to the Company and certain
other parties were also assigned to K2 in consideration for K2
paying to the Company £100,001 and agreeing to fund Dynamic so as
to enable Dynamic to carry on its business in the ordinary course
until such time as the Company ceases to hold any further shares in
Dynamic.
The
Company’s present primary operations and source of revenue remains
its 51% holding in Dynamic, our Cape
Town based spice blender and trader. The underlying Company
was still loss making for the year ended 31
October 2022 (see Note 4 for a full explanation) but has
since improved its performance during the six-months ended
30 April 2023. Group turnover
increased by 20.98% (6 months to 30 April
2022: a reduction of 13.5%). Group operating losses amounted
to £1,380,631 (6 months to 30 April
2022: £11,176) for the current period.
During the
period our previous auditor resigned as they were no longer in a
position to audit Public Interest Entity (“PIE”) companies and due
to capacity constraints with many other auditors there was a delay
in appointing a PIE registered auditor. As a result, the Company
could not complete their statutory audit, publication of results or
statutory filing at Companies House on time. As such, trading in
the Company’s Ordinary Shares and its listing on the Official List
of the Financial Conduct Authority was
suspended.
The
Company was granted an extension of its filing obligations by
Companies House.
Dynamic
Intertrade (“Dynamic”)
For the
6-month period ending 30 April 2023,
Dynamic recorded revenue of R30.8 million (30 April 2022, R14.04 million, and 31 October 2022, R34.8 million) representing a
119% increase. This increase in revenue resulted in gross profit of
R9.28 million (representing a gross margin of 30%). This is a 50%
improvement in the margin from the 20% for the six months ended
30 April 2022 and the 24.74% for the
full year ended 31 October 2022.
Operating expenses have increased by 11% to R4.9 million from R4.4
million for the period to 30 April
2022. EBITDA was R4.6 million (31
October 2022: Loss – R11.2 million).
While a
pleasing improvement it has put pressure on the working capital
requirements which we are expecting K2 to assist with under an
agreement signed on 3 October
2022.
DI has
maintained its FSSC22000 certification which is important when
dealing with blue chip food manufacturing companies.
Dynamic
Intertrade Agri (“DIA”)
As stated
on 20 July 2023, the Company’s 46.8%
share in DIA was disposed of to Athena Trading Worldwide Limited
for a consideration of £15,384.62.
Group
Results for the period
Group
turnover increased to £1,434,073 for the six months ended
30 April 2023 from the £681,761 for
the comparative period ended 30 April
2022, and is only 15,6% lower than the turnover for the full
year ended 31 October 2022 of
£1,698,839. The Group made an operating profit of £476,634 for the
six months to 30 April 2023
(30 April 2022: loss of £11,176,
31 October 2022: loss of £1,152,170).
This has primarily been the result of an improvement in the
exchange rates as evidenced by the gain on foreign exchange of
£383,990 and the increase in revenue mentioned above.
At the end
of the period under review the Company had cash and cash
equivalents of £1,405,609 (30 April
2022: £503,399, 31 October
2022: £925,814).
Outlook
While the
world economy is uncertain with the war in the Ukraine, inflation, high interest rates and,
uncertain demand and supply we believe we will steady the Company
and give it a solid foundation for future growth.
The unaudited
interim report for the 6 months ended 30
April 2023 is
available on the Company's website at: www.everestglobalplc.com and
in hard copy form at the Company's registered office at
48
Chancery Lane, London WC2A
1JF.
It
will also shortly be available
for inspection at: www.fca.org.uk/markets/primary-markets/regulatory-disclosures/national-storage-mechanism.
Prior
to publication, the information contained within this announcement
was deemed by the Company to constitute inside
information for
the purposes of Article 7 of EU Regulation 596/2014 (which forms
part of domestic UK law pursuant to the European Union (Withdrawal)
Act 2018). With the publication of this announcement, this
information is now considered to be in the public
domain.
The
Directors of the Company accept responsibility for the content of
this announcement.
For
further information please contact the following:
|
Everest
Global plc
|
|
|
|
|
|
Andy Sui, Chief
Executive Officer
Rob
Scott, Non-Executive Director
|
+44
(0) 776 775 1787
+27
(0)84 6006
001
|
|
|
|
|
Cairn
Financial Advisers LLP
|
|
|
Jo
Turner / Emily Staples
|
+44
(0) 20 7213 0885 / +44 (0)20 7213 0897
|
|
|
|
|
|
|
|
|
|
Caution
regarding forward looking statements
Certain
statements in this announcement, are, or may be deemed to be,
forward looking statements. Forward looking statements are
identified by their use of terms and phrases such as ''believe'',
''could'', "should" ''envisage'', ''estimate'', ''intend'',
''may'', ''plan'', ''potentially'', "expect", ''will'' or the
negative of those, variations or comparable expressions, including
references to assumptions. These forward-looking statements are not
based on historical facts but rather on the Directors' current
expectations and assumptions regarding the Company's future growth,
results of operations, performance, future capital and other
expenditures (including the amount, nature and sources of funding
thereof), competitive advantages, business prospects and
opportunities. Such forward looking statements reflect the
Directors' current beliefs and assumptions and are based on
information currently available to the Directors.
Principal
Risks and uncertainties for the remaining 6 months of the financial
year
The
Directors consider the following risk factors to be of relevance to
the Group’s activities for the remaining 6 months of the financial
year. It should be noted that the list is not exhaustive and that
other risk factors not presently known or currently deemed
immaterial may apply:
i. Development
Risk
The
Group’s development will be, in part, dependent on the ability of
the Directors to continue to improve the current business, to
identify suitable investment opportunities and to implement the
Group’s strategy. There is no assurance that the Group will be
successful in acquiring suitable investments.
ii. Sector
Risk
The
agriculture and agri-processing sectors are highly competitive
markets and many of the competitors will have greater financial and
other resources than the Company and as a result may be in a better
position to compete for opportunities.
The
development of these enterprises involves significant uncertainties
and risks including unusual climatic conditions such as drought,
improper use of pesticides, availability of labour and seasonality
of produce, any one of which could result in security of supply,
damage to, or destruction of crops, environmental damage or
pollution. Each of these could have a material adverse impact on
the business, operations and financial performance of the
Group.
The market
price of agricultural products and crops is volatile and affected
by numerous factors which are beyond the Group’s
control.
These
include international supply and demand, the level of consumer
product demand, international economic trends, currency exchange
rate fluctuations, the level of interest rates, the rate of
inflation, global or regional political events, as well as a range
of other market forces. Sustained downward movements in
agricultural prices could render less economic, or un-economic, any
development or investing activities to be undertaken by the Group.
Certain agricultural projects involve high capital costs and
associated risks. Unless such projects enjoy long term returns,
their profitability will be uncertain resulting in potentially high
investment risk.
iii. Political
and Regulatory Risk
African
countries experience varying degrees of political instability.
There can be no assurance that political stability will persist in
those countries where the Group may have operations going forward.
In the event of political instability or changes in government
policies in those countries where the Group may operate, the
operations and financial condition of the Group could be adversely
affected.
iv. Environmental
Risks and Hazards
All phases
of the Group’s operations are subject to environmental regulation
in the areas in which it operates. Environmental legislation is
evolving in a manner that may require stricter standards and
enforcement, increased fines and penalties for non-compliance, more
stringent environmental assessments of proposed projects and a
heightened degree of responsibility for companies and their
officers, Directors and employees.
There is
no assurance that existing or future environmental regulation will
not materially adversely affect the Group’s business, financial
condition and results of operations. Environmental hazards may
exist on the properties on which the Group holds interests that are
unknown to the Group at present. The Board manages this risk by
working with environmental consultants and by engaging with the
relevant governmental departments and other concerned
stakeholders.
v. Internal
Control and Financial Risk Management
The Board
has overall responsibility for the Group’s systems of internal
control and for reviewing their effectiveness. The Group maintains
systems which are designed to provide reasonable but not absolute
assurance against material loss and to manage rather than eliminate
risk.
The key
features of the Group’s systems of internal control are as
follows:
-
Management
structure with clearly identified responsibilities;
-
Production
of timely and comprehensive historical management information
presented to the Board;
-
Detailed
budgeting and forecasting;
-
Day to day
hands on involvement of the Executive Director and Senior
Management; and
-
Regular
Board meetings and discussions with the Non-Executive
Directors.
The
Group’s activities expose it to several financial risks including
cash flow risk, liquidity risk and foreign currency
risk.
vi. Environmental
Policy
The Group
is aware of the potential impact that its subsidiary and associate
companies may have on the environment. The Group ensures that it
complies with all local regulatory requirements and seeks to
implement a best practice approach to managing environmental
aspects.
The
subsidiary, Dynamic Intertrade operates a Food
Safety System
Certification (“FSSC”) compliant facility in Cape Town. The FSSC provides a framework for
effectively managing the organisation's food safety
responsibilities and is fully recognized by the Global Food Safety
Initiative and is based on existing ISO Standards.
vii.
Health and
Safety
The
Group’s aim is to achieve and maintain a high standard of workplace
safety. In order to achieve this objective, the Group provides
ongoing training and support to employees and sets demanding
standards for workplace safety.
viii. Financing
Risk
The
development of the Group’s business may depend upon the Group’s
ability to obtain financing primarily through the raising of new
equity capital or debt. The Group’s ability to raise further funds
may be affected by the success of existing and acquired
investments. The Group may not be successful in procuring the
requisite funds on terms which are acceptable to it (or at all)
and, if such funding is unavailable, the Group may be required to
reduce the scope of its investments or the anticipated expansion.
Further, Shareholders’ holdings of Ordinary Shares may be
materially diluted if debt financing is not available.
ix. Credit
Risk
The
Directors have reviewed the forecasts prepared by both the Company
and Dynamic and believe that Dynamic has adequate resources
available to meet its obligations to the Company and its
lenders.
x. Liquidity
Risk
The
Directors have reviewed the working capital requirements of the
Company and Dynamic and believe that, following stress tests and
variance analysis on the forecasts, there is sufficient working
capital to fund the business while expanding turnover. The
Directors further highlight the inherent uncertainties involved in
making the assessment that the entity is a going
concern.
xi.
Capital
Risk
The Group
manages its capital resources to ensure that entities in the Group
will be able to continue as a going concern, while maximising
shareholder return.
The
capital structure of the Group consists of equity attributable to
shareholders, comprising issued share capital and reserves. The
availability of new capital will depend on many factors including a
positive operating environment, positive stock market conditions,
the Group’s track record, and the experience of management. There
are no externally imposed capital requirements. The Directors are
confident that adequate cash resources exist or will be made
available to finance operations and controls over expenditure are
carefully managed.
To manage
the above risks, management are in regular contact with our
customers and are actively exploring new markets and customers in
order to diversify these risks.
Responsibility
Statement
The
Directors, whose names and functions are set out under the
‘Directors and Advisers’ section of this report with registered
office located at 48 Chancery Lane, London WC2A 1JF, accept responsibility for the
information contained in this set of interim results for the six
month period ended 30 April
2023.
To the
best of the knowledge of the Directors:
•
The
condensed set of financial statements are prepared in accordance
with the applicable set of accounting standards (with IAS 34
‘Interim Financial Reporting’ as contained in UK-adopted IFRS),
give a true and fair view of the assets, liabilities, financial
position and profit or loss of Everest Group Plc and the
undertakings included in the consolidation taken as a whole;
and
•
the
interim management report, titled ‘Chief Executive’s Report’
includes an indication of important events that have occurred
during the first six months of the financial year, and their impact
on the condensed set of financial statements,
and
a
description of the principal risks and uncertainties for the
remaining six months of the financial year.
•
the
interim management report includes a fair review of the information
required by DTR 4.2.8R (disclosure of related parties’ transactions
and changes therein).
Everest
Group Plc acknowledges that it is responsible for all information
drawn up and made public in this set of interim results for the
period ended 30 April
2023.
Andy Sui
Chief
Executive Officer
31 July 2023
Interim Condensed Consolidated Statement of Comprehensive
Income
|
|
|
6
Months ended
|
Year
ended
|
6
Months ended
|
|
|
|
30
April
|
31
October
|
30
April
|
|
|
|
2023
|
2022
|
2022
|
|
|
|
(Unaudited)
|
(Audited)
|
(Unaudited)
|
|
|
Notes
|
£
|
£
|
£
|
|
|
|
|
|
|
|
Turnover
|
|
1,434,073
|
1,698,839
|
681,761
|
|
Cost of
sales
|
|
(1,002,206)
|
(1,278,471)
|
(545,163)
|
|
Gross
profit
|
|
431,867
|
420,368
|
136,598
|
|
|
|
|
|
|
|
Other
Income
|
|
383,990
|
1,264
|
315,495
|
|
Administrative
expenses
|
4
|
(339,223)
|
(1,573,802)
|
(463,269)
|
|
Operating
profit / (loss)
|
|
476,634
|
(1,152,170)
|
(11,176)
|
|
|
|
|
|
|
|
Finance
costs
|
|
(117,548)
|
(3,418,549)
|
(125,403)
|
|
Finance
income
|
|
20,377
|
157
|
-
|
|
Profit /
(loss) before taxation
|
|
379,463
|
(4,570,562)
|
(136,579)
|
|
Tax on
Profit / (loss) on ordinary activities
|
|
-
|
-
|
-
|
|
Profit
/ (loss) after taxation
|
|
379,463
|
(4,570,562)
|
(136,579)
|
|
|
|
|
|
|
|
Other
Comprehensive Income
|
|
-
|
-
|
-
|
|
|
|
|
|
|
|
Total
comprehensive income / (loss) for the year from continuing
operations
|
|
379,463
|
(4,570,562)
|
(136,579)
|
|
|
|
|
|
|
|
Total
comprehensive income / (loss) attributable to ordinary
shareholders
|
|
137,570
|
(4,571,084)
|
|
|
Total
comprehensive income / (loss) attributable to non-controlling
interests
|
|
241,893
|
522
|
|
|
Total
comprehensive income / (loss) for the period
|
|
379,463
|
(4,570,562)
|
(136,579)
|
|
|
|
|
|
|
|
Basic and
diluted earnings per share
|
5
|
1.15p
|
(17.79p)
|
(0.62p)
|
Interim Condensed Consolidated Statement of Changes in
Equity
|
|
Share
Capital
|
Share
Premium
|
Share
Based Payments Reserve
|
Equity
Portion of Convertible Loan Notes
|
Retained
Earnings
|
Total
Equity
|
Oustide
Shareholder's Interest
|
Total
Equity
|
|
|
£
|
£
|
£
|
£
|
£
|
£
|
£
|
£
|
|
Balance
at 31 October 2021
|
439,322
|
2,571,247
|
83,377
|
74,935
|
(4,416,527)
|
(1,247,646)
|
-
|
(1,247,646)
|
|
Share
Issue
|
76,473
|
76,473
|
-
|
-
|
-
|
152,946
|
-
|
152,946
|
|
Loss for
the period
|
-
|
-
|
-
|
-
|
(136,579)
|
(136,579)
|
-
|
(136,579)
|
|
Balance
at 30 April 2022
|
515,795
|
2,647,720
|
83,377
|
74,935
|
(4,553,106)
|
(1,231,279)
|
-
|
(1,231,279)
|
|
Shares
issued
|
260,000
|
390,000
|
|
|
|
650,000
|
-
|
650,000
|
|
Shares
issued on conversion of convertible loan notes
|
147,463
|
221,194
|
|
|
|
368,657
|
-
|
368,657
|
|
Extension
of date of conversion of the convertible loan notes
|
-
|
-
|
-
|
(32,396)
|
|
(32,396)
|
-
|
(32,396)
|
|
Warrants
issued during the year
|
-
|
(218,799)
|
218,799
|
-
|
|
-
|
-
|
-
|
|
Loss
attributable to non-controlling interest on disposal of 49% of
subsidiary
|
-
|
-
|
-
|
-
|
2,305,905
|
2,305,905
|
(2,305,905)
|
-
|
|
Loss for
the year
|
-
|
-
|
-
|
-
|
(4,434,505)
|
(4,434,505)
|
522
|
(4,433,983)
|
|
Balance
at 31 October 2022
|
923,258
|
3,040,115
|
302,176
|
42,539
|
(6,681,706)
|
(2,373,618)
|
(2,305,383)
|
(4,679,001)
|
|
Share
Issue
|
254,520
|
445,410
|
-
|
-
|
-
|
699,930
|
-
|
699,930
|
|
Conversion
of convertible loan notes to equity
|
120,000
|
180,000
|
-
|
-
|
-
|
300,000
|
-
|
300,000
|
|
Warrants
issued during the period
|
-
|
(48,573)
|
48,573
|
-
|
-
|
-
|
-
|
-
|
|
Loss for
the period
|
-
|
-
|
-
|
-
|
137,570
|
137,570
|
241,893
|
379,463
|
|
Balance
at 30 April 2023
|
1,297,778
|
3,616,952
|
350,749
|
42,539
|
(6,544,136)
|
(1,236,118)
|
(2,063,490)
|
(3,299,608)
|
Share
capital is the amount subscribed for shares at nominal
value.
Retained
losses represent the cumulative loss of the Group attributable to
equity shareholders.
Share-based
payments reserve relate to the charge for share-based payments in
accordance with IFRS 2.
Interim Condensed Consolidated Statement of the Financial
Position
|
|
|
6
Months ended
|
Year
ended
|
6
Months ended
|
|
|
|
30
April
|
31
October
|
30
April
|
|
|
|
2023
|
2022
|
2022
|
|
|
|
(Unaudited)
|
(Audited)
|
(Unaudited)
|
|
|
Notes
|
£
|
£
|
£
|
|
Assets
|
|
|
|
|
|
Non-current
assets
|
|
|
|
|
|
Property,
plant and equipment
|
6
|
25,632
|
13,884
|
11,266
|
|
Right of
use asset
|
11
|
204,809
|
250,446
|
327,829
|
|
Total
Non-Current Assets
|
|
230,441
|
264,330
|
339,095
|
|
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
Investment
in associate - (held for sale)
|
8
|
6,154
|
6,154
|
6,154
|
|
Inventories
|
|
211,983
|
175,875
|
34,847
|
|
Trade and
other receivables
|
|
489,713
|
282,529
|
327,299
|
|
Cash and
cash equivalents
|
|
1,405,609
|
925,814
|
503,399
|
|
Total
current assets
|
|
2,113,459
|
1,390,372
|
871,699
|
|
Total
assets
|
|
2,343,900
|
1,654,702
|
1,210,794
|
|
|
|
|
|
|
|
Equity
and liabilities
|
|
|
|
|
|
Share
capital
|
9
|
1,297,778
|
923,258
|
515,795
|
|
Share
premium
|
9
|
3,616,952
|
3,040,115
|
2,647,720
|
|
Share-based
payments reserve
|
|
350,749
|
302,176
|
83,377
|
|
Equity
portion of convertible loan notes
|
|
42,539
|
42,539
|
74,935
|
|
Retained
earnings
|
|
(6,544,136)
|
(6,681,706)
|
(4,553,107)
|
|
Total
owner's equity
|
|
(1,236,118)
|
(2,373,618)
|
(1,231,280)
|
|
Non-controlling
interests
|
|
(2,063,490)
|
(2,305,383)
|
-
|
|
Total
equity
|
|
(3,299,608)
|
(4,679,001)
|
(1,231,280)
|
|
|
|
|
|
|
|
Non-current
liabilities
|
|
|
|
|
|
Non-current
lease liabilities
|
10
|
120,167
|
166,070
|
242,796
|
|
Borrowings
|
|
4,322,281
|
4,732,492
|
791,472
|
|
Convertible
loan notes
|
|
450,802
|
710,274
|
778,065
|
|
Total
non-current liabilities
|
|
4,893,250
|
5,608,836
|
1,812,333
|
|
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
Current
lease liabilities
|
10
|
101,110
|
100,485
|
87,866
|
|
Trade and
other payables
|
|
649,148
|
624,382
|
542,326
|
|
Total
current liabilities
|
|
750,258
|
724,867
|
630,192
|
|
Total
equity and liabilities
|
|
2,343,900
|
1,654,702
|
1,210,794
|
Interim Condensed Consolidated Statement of Cash
Flows
|
|
|
6
Months ended
|
Year
ended
|
6
Months ended
|
|
|
|
30
April
|
31
October
|
30
April
|
|
|
|
2023
|
2022
|
2022
|
|
|
|
(Unaudited)
|
(Audited)
|
(Unaudited)
|
|
|
Notes
|
£
|
£
|
£
|
|
Cash
flows from operating activities
|
|
|
|
|
|
Operating
loss
|
|
476,634
|
(1,152,170)
|
(11,176)
|
|
Add:
Depreciation
|
|
45,369
|
84,960
|
37,547
|
|
Add:
unrealised foreign exchange (gain) / loss
|
|
|
(41,293)
|
(26,728)
|
|
Add:
(Profit)/loss on disposal of property, plant and
equipment
|
|
-
|
-
|
1,256
|
|
Finance
costs
|
|
61,809
|
(124,889)
|
(185,777)
|
|
Interest
received
|
|
20,377
|
157
|
-
|
|
Profit on
disposal of loans receivable
|
|
-
|
1
|
|
|
Changes
in working capital
|
|
|
|
|
|
(increase)
/ decrease in inventories
|
|
(36,108)
|
(133,193)
|
(5,720)
|
|
(increase)
/ decrease in receivables
|
|
(207,184)
|
15,271
|
44,257
|
|
(Decrease)
/ increase in payables
|
|
24,766
|
(538,038)
|
(715,968)
|
|
Net
cash flow from operating activities
|
|
385,663
|
(1,889,194)
|
(862,309)
|
|
|
|
|
|
|
|
Investing
Activities
|
|
|
|
|
|
Acquisition
of property, plant and equipment
|
|
(28,287)
|
(5,541)
|
(257)
|
|
Disposal
of property, plant and equipment
|
|
-
|
-
|
1,303
|
|
Foreign
exchange movements
|
|
2,103
|
(7)
|
(19,593)
|
|
Net
cash flow from investing activities
|
|
(26,184)
|
(5,548)
|
(18,547)
|
|
|
|
|
|
|
|
Cash
flows from financing activities:
|
|
|
|
|
|
Net
proceeds from issue of shares
|
9
|
699,930
|
650,000
|
-
|
|
(Decrease)
/ Increase in borrowings
|
|
(527,815)
|
1,134,015
|
348,503
|
|
Foreign
exchange movements
|
|
|
-
|
(23,095)
|
|
Capital
repayments of lease liability
|
|
(51,799)
|
(73,233)
|
(50,863)
|
|
Net
cash flow from financing activities
|
|
120,316
|
1,710,782
|
274,545
|
|
|
|
|
|
|
|
Net
cash flow for the period
|
|
479,795
|
(183,960)
|
(606,311)
|
|
Opening
Cash and cash equivalents
|
|
925,814
|
1,109,774
|
1,109,774
|
|
Foreign
exchange movements
|
|
|
-
|
(64)
|
|
Closing
Cash and cash equivalents
|
|
1,405,609
|
925,814
|
503,399
|
Notes
to the Interim Condensed Consolidated Financial
Statements
1. General
Information
Everest
Global plc is a company incorporated in the United Kingdom. Details of the registered
office, the officers and advisers to the Company are presented on
the Directors and Advisers page at the end of this report. The
Company is admitted to the Official List (by way of a Standard
Listing under Chapter 14 of the Listing Rules) and to trading on
the London Stock Exchange’s Main Market for listed securities. The
information within these Interim condensed consolidated financial
statements and accompanying notes must be read in conjunction with
the audited annual financial statements that have been prepared for
the year ended 31 October
2022.
2. Basis
of Preparation
These
unaudited condensed consolidated interim financial statements for
the six months ended 30 April 2023
have been prepared in accordance with International Accounting
Standard No34, Interim Financial Reporting, as contained in
International Financial Reporting Standards as adopted by the
United Kingdom (IFRS as adopted by
the UK),
were
approved by the board and authorised for issue on 31 July 2023.
The basis
of preparation and accounting policies set out in the Annual Report
and Accounts for the year ended 31 October
2022 have been applied in the preparation of these condensed
consolidated interim financial statements. These interim financial
statements have been prepared in accordance with the recognition
and measurement principles of the International Financial Reporting
Standards (“IFRS”) as endorsed by the UK that are expected to be
applicable to the consolidated financial statements for the year
ending 31 October 2023 and on the
basis of the accounting policies expected to be used in those
financial statements.
The
figures for the six months ended 30 April
2023 and 30 April 2022 are
unaudited and do not constitute full accounts. The comparative
figures for the year ended 31 October
2022 are extracts from the 2022 audited accounts. The
independent auditor’s report on the 2022 accounts was qualified on
the basis that they were appointed after the year and could not
verify the value of the inventory on hand by the subsidiary at the
year end, and it included a material uncertainty in respect of
going concern.
3. Segmental
Reporting
In the
opinion of the Directors, the Group has one class of business,
being the trading of agricultural materials. The Group’s primary
reporting format is determined by the geographical segment
according to the location of its establishments. There is currently
only one geographic reporting segment, which is South Africa. All revenues and costs are
derived from the single segment. Historically this segment has
experienced a high demand for its products in the months of July to
December with a lower-than-average demand in the months of January
to March.
4. Company
Result for the period
The
Company has elected to take the exemption under section 408 of the
Companies Act 2006 not to present the parent Company income
statement account.
The
operating profit of the Group for the six-month period ended
30 April 2023 was £476,634
(30 April 2022: loss of £11,176, year
end 31 October
2022:
loss of
£1,152,170). The operating loss incorporated the following main
items:
|
|
|
6
Months ended
|
Year
ended
|
6
Months ended
|
|
|
|
30
April
|
31
October
|
30
April
|
|
|
|
2023
|
2022
|
2022
|
|
|
|
(Unaudited)
|
(Audited)
|
(Unaudited)
|
|
|
|
£
|
£
|
£
|
|
|
|
|
|
|
|
Accounting
and administration fees
|
|
16,626
|
39,338
|
24,413
|
|
Brokership
fees
|
|
2,473
|
15,000
|
-
|
|
Legal and
professional fees
|
|
57,514
|
(269,522)
|
32,164
|
|
Registrar
fees
|
|
2,493
|
3,034
|
1,767
|
|
Personnel
expenses
|
|
133,121
|
232,273
|
105,709
|
|
Finance
charges associated with disposal of intercompany loan to VSA NEX
Investments Limited
|
|
-
|
3,131,890
|
-
|
As set in
the annual financial statements for the year ended 31 October 2022, on 3
October 2022, the Company and K2 Spice
Limited (previously VSA NEX Investments Limited) (“K2”),
entered
into certain related party arrangements in relation to Dynamic
Intertrade (Pty) Ltd (“Dynamic”). K2 was a 100% subsidiary of VSA
Capital. At the time the arrangements were entered into
Andrew Monk was a director of the
Company, VSA Capital and K2 and is deemed to have significant
influence over VSA Capital and K2. Pursuant to the arrangements, K2
subscribed for such number of new shares in the capital of Dynamic
resulting in K2 holding 49% of the enlarged issued share capital of
Dynamic for a consideration of ZAR10,982; the Company agreed to assign certain
debts owing by Dynamic, amounting to £4.2 million which had been
fully impaired in prior years, to the Company and certain other
parties to K2 in consideration for K2 paying to the Company
£100,001 and agreeing to fund Dynamic so as to enable Dynamic to
carry on its business in the ordinary course until such time as the
Company ceases to hold any further shares in Dynamic. This
assignment agreement resulted in K2 having a non-controlling
interest in Dynamic and as such its share of the current year
profits amounted to £522, its share of accumulated losses prior to
acquisition amounted to £3,131,890. Additionally, the assignment of
the loans resulted in the Group incurring a finance charge on
consolidation of £2.9 million. K2 has signed a subordination
agreement in relation to the loans due by Dynamic to K2 with an
expiry date of 31 October 2023.
Should K2 choose to request the repayment of the loans due by
Dynamic this will severely impact the Company's ability to continue
as a going concern. Under a put and call option agreement the
Company granted to K2 the option to acquire 11,430 shares in
Dynamic Intertrade, being the remaining 51% of Dynamic held by the
Company, subject to the satisfaction of certain conditions and
subject to certain time restrictions for £1.
5. Earnings
per Share
Earnings
per share data is based on the Group result for the six months and
the weighted average number of ordinary shares in issue.
Basic loss
per share is calculated by dividing the loss attributable to equity
shareholders by the weighted average number of Ordinary Shares in
issue during the period:
|
|
6
Months ended
|
Year
ended
|
6
Months ended
|
|
|
30
April
|
31
October
|
30
April
|
|
|
2023
|
2022
|
2022
|
|
|
(Unaudited)
|
(Audited)
|
(Unaudited)
|
|
|
£
|
£
|
£
|
|
Profit /
(loss) after tax
|
379,463
|
(4,570,562)
|
(136,579)
|
|
Weighted
average number of ordinary shares in issue
|
33,023,894
|
25,690,228
|
21,966,077
|
|
Basic
earnings / (loss) per share (pence)
|
1.15p
|
(17.79p)
|
(0.62p)
|
|
Diluted
earnings / (loss) per share (pence)
|
0.36p
|
(17.79p)
|
(0.62p)
|
For the
comparative figures as at 31 October
2022 and 30 April 2022, the
basic and diluted earnings per share are the same, since where a
loss is incurred the effect of outstanding share options and
warrants is considered anti-dilutive and is ignored for the purpose
of the loss per share calculation. As at 30
April 2023 there were 42,922,767 Ordinary Shares and
38,363,171 share warrants outstanding (31
October 2022: 24,196,767 Ordinary shares and 38,363,171
share warrants outstanding, 30 April
2022 there were 26,148,289 Ordinary shares and 897,809 share
warrants outstanding).
6. Property,
Plant and Equipment
Depreciation
on property, plant and equipment is calculated using the
straight-line method to write off their cost over their estimated
useful lives at the following annual rates:
|
Furniture and fixtures
|
17%
|
|
Leasehold improvements
|
33%
|
|
Plant and equipment
|
20% and 33%
|
Useful
lives and depreciation method are reviewed and adjusted if
appropriate, at the end of each reporting period.
An item of
property, plant and equipment is derecognised upon disposal or when
no future economic benefits are expected to arise from the
continued use of the asset. Any gain or loss arising on the
disposal or retirement of an item of property, plant and equipment
is determined as the difference between the sales proceeds and the
carrying amount of the relevant asset and is recognised in profit
or loss in the year in which the asset is derecognised.
|
Group
|
Leasehold
property
|
Furniture
and fixtures
|
Plant
and equipment
|
Total
|
|
|
£
|
£
|
£
|
£
|
|
Cost
|
|
|
|
|
|
As
at 31 October 2021
|
19,746
|
4,356
|
279,382
|
303,484
|
|
Exchange
difference
|
979
|
216
|
13,844
|
15,039
|
|
Additions
|
-
|
-
|
257
|
257
|
|
Disposals
|
-
|
-
|
(5,088)
|
(5,088)
|
|
As
at 30 April 2022
|
20,725
|
4,572
|
288,395
|
313,692
|
|
Exchange
difference
|
(1,173)
|
(272)
|
(43,830)
|
(45,275)
|
|
Additions
|
-
|
-
|
10,372
|
10,372
|
|
Disposals
|
-
|
-
|
-
|
-
|
|
As
at 31 October 2022
|
19,552
|
4,300
|
254,937
|
278,789
|
|
Exchange
difference
|
-
|
(350)
|
(32,380)
|
(32,730)
|
|
Additions
|
-
|
-
|
28,287
|
28,287
|
|
Disposals
|
-
|
-
|
-
|
-
|
|
As
at 30 April 2023
|
19,552
|
3,950
|
250,844
|
274,346
|
|
|
|
|
|
|
|
Accumulated
depreciation
|
|
|
|
|
|
As
at 31 October 2021
|
19,720
|
4,060
|
265,935
|
289,715
|
|
Exchange
difference
|
977
|
205
|
13,298
|
14,480
|
|
Charge for
the year
|
25
|
98
|
3,196
|
3,319
|
|
Released
on disposal
|
-
|
-
|
(5,088)
|
(5,088)
|
|
As
at 30 April 2022
|
20,722
|
4,363
|
277,341
|
302,426
|
|
Exchange
difference
|
(1,172)
|
(245)
|
(38,205)
|
(39,622)
|
|
Charge for
the year
|
-
|
75
|
2,026
|
2,101
|
|
Released
on disposal
|
-
|
-
|
-
|
-
|
|
As
at 31 October 2022
|
19,550
|
4,193
|
241,162
|
264,905
|
|
Exchange
difference
|
-
|
(353)
|
(30,274)
|
(30,627)
|
|
Charge for
the year
|
-
|
50
|
14,386
|
14,436
|
|
Released
on disposal
|
-
|
-
|
-
|
-
|
|
As
at 30 April 2023
|
19,550
|
3,890
|
225,274
|
248,714
|
|
|
|
|
|
|
|
Net
Book Value
|
|
|
|
|
|
As at 30
April 2022
|
3
|
209
|
11,054
|
11,266
|
|
As at 31
October 2022
|
2
|
107
|
13,775
|
13,884
|
|
As
at 30 April 2023
|
2
|
60
|
25,570
|
25,632
|
The
holding company held no tangible fixed assets at 30 April 2023, 31 October
2022 and 30 April
2022.
7. Subsidiaries
Everest
Global plc holds investments in the following subsidiary
undertakings as at 30 April 2023,
which principally affected the profits, losses and net assets of
the Group.
|
Name of companies
|
Principal activities
|
Country of incorporation and place of business
|
Proportion (%) of equity interest at 30 April 2023
|
Proportion (%) of equity interest at 30 April 2022
|
|
Dynamic Intertrade (Pty) Limited
|
Value added agricultural products
|
South Africa
|
51%
|
100%
|
Subsidiaries
are all entities over which the Group has the power to govern the
financial and operating policies generally accompanying a
shareholding of more than one half of the voting rights.
Subsidiaries are consolidated, using the acquisition method, from
the date that control is gained and are stated at cost less, where
appropriate, provisions for impairment. Entities that do not comply
with this policy, but over which the Group has a shareholding of
between 20 and 50 percent of the voting rights are equity accounted
from the date of acquisition and are stated at cost and adjusted
for the results of these entities for the accounting
period.
The
remaining 49%, a non-controlling interest, is held by K2 Spice
Limited, formerly VSA NEX Investments Limited. The circumstances
surrounding this dilution of the Company’s holding in Dynamic is
explained in the annual financial statements for the year ended
31 October 2022.
8. Investment
in Associate
|
|
6
Months ended
|
Year
ended
|
6
Months ended
|
|
|
30
April
|
31
October
|
30
April
|
|
|
2023
|
2022
|
2022
|
|
|
(Unaudited)
|
(Audited)
|
(Unaudited)
|
|
|
£
|
£
|
£
|
|
Investment
in Dynamic Intertrade Agri (Pty) Ltd
|
6,154
|
6,154
|
6,154
|
|
Equity
accounted profit/ (loss) for the period
|
-
|
-
|
-
|
|
Impairment
of investment
|
-
|
-
|
-
|
|
Carrying
value
|
6,154
|
6,154
|
6,154
|
9. Share
Capital
Ordinary
Shares are classified as equity. Proceeds from issuance of Ordinary
Shares are classified as equity. Incremental costs directly
attributable to the issuance of new Ordinary Shares are deducted
against share capital.
|
Allotted,
called up and fully paid Ordinary
|
Number
of
|
|
|
|
Shares
of 2.0p each
|
shares
|
Share
Capital
|
Share
Premium
|
|
|
|
£
|
£
|
|
Balance
at 31 October 2021
|
21,966,088
|
439,322
|
2,571,247
|
|
Share
issue - 29 April 2022
|
3,823,627
|
76,473
|
76,473
|
|
Balance
at 30 April 2022
|
25,789,715
|
515,795
|
2,647,720
|
|
Share
issue on conversion of convertible loan notes 3 October
2022
|
7,373,140
|
147,463
|
221,194
|
|
Share
issue 3 October 2022
|
13,000,000
|
260,000
|
390,000
|
|
Warrants
issued - 3 October 2022
|
-
|
-
|
(218,799)
|
|
Balance
at 31 October 2022
|
46,162,855
|
923,258
|
3,040,115
|
|
Share
issue - 24 January 2023
|
12,726,000
|
254,520
|
445,410
|
|
Warrants
issued - 24 January 2023
|
-
|
-
|
|
|
Conversion
of Convertible Loan Notes -
|
|
|
|
|
25 January
2023
|
6,000,000
|
120,000
|
180,000
|
|
Warrants
issued - 24 January 2023
|
-
|
-
|
|
|
Balance
at 30 April 2023
|
64,888,855
|
1,297,778
|
3,665,525
|
10 Leases
Right
of Use Asset and Liability
On
adoption of IFRS 16, the Group recognised lease liabilities in
relation to leases which had previously been classified as
'operating leases' under the principles of IAS 17 Leases. These
liabilities were measured at the present value of the remaining
lease payments, discounted using the lessee's incremental borrowing
rate for comparable assets as of 1 November
2019. The weighted average lessee's incremental borrowing
rate for comparable mortgage bonds applied to the lease liabilities
on 1 November 2019 was 8.5%, being
the discount rate on the Group's borrowings. In the Directors
opinion this is the discount rate that the Group would obtain
should it be purchasing land and buildings. Without further
security available the Group would be unlikely to secure funding
from other sources and therefore the Directors believe the 8.5%
rate applied is the most appropriate basis on which to base the
IFRS 16 calculations.
For leases
previously classified as finance leases the entity recognised the
carrying amount of the lease asset and lease liability immediately
before transition as the carrying amount of the right of use asset
and the lease liability at the date of initial application. The
measurement principles of IFRS 16 are only applied after that
date.
|
|
|
6
Months ended
|
Year
ended
|
6
Months ended
|
|
|
|
30
April
|
31
October
|
30
April
|
|
|
|
2023
|
2022
|
2022
|
|
|
|
(Unaudited)
|
(Audited)
|
(Unaudited)
|
|
|
|
£
|
£
|
£
|
|
Lease
liability recognised in the statement
|
|
|
|
|
|
of
financial position at 31 October 2021
|
|
266,555
|
347,102
|
347,102
|
|
Foreign
exchange movements
|
|
(3,455)
|
(7,313)
|
17,200
|
|
borrowing
rate at date of initial application
|
|
9,975
|
-
|
17,223
|
|
Lease
payments
|
|
(51,799)
|
(73,234)
|
(50,863)
|
|
Lease
liability recognised in the
|
|
|
|
|
|
statement
of financial position
|
|
221,276
|
266,555
|
330,662
|
|
|
|
|
|
|
|
Of
which:
|
|
|
|
|
|
Current
lease liabilities
|
|
101,110
|
100,485
|
87,866
|
|
Non-current
lease liabilities
|
|
120,167
|
166,070
|
242,796
|
|
|
|
221,277
|
266,555
|
330,662
|
Right-of
use assets were measured at the amount equal to the lease
liability, adjusted by the amount of any prepaid or accrued lease
payments relating to that lease recognised in the statement of
financial position as at 31 October
2022. There were no onerous lease contracts that would have
required an adjustment to the right-of-use assets at the date of
initial application. The recognised right of-use assets relate to
the following types of assets:
|
|
|
6
Months ended
|
Year
ended
|
6
Months ended
|
|
|
|
30
April
|
31
October
|
30
April
|
|
|
|
2023
|
2022
|
2022
|
|
|
|
(Unaudited)
|
(Audited)
|
(Unaudited)
|
|
|
|
£
|
£
|
£
|
|
|
|
|
|
|
|
Properties
|
|
204,809
|
250,446
|
327,829
|
11 Events
Subsequent to 30 April
2023
On
4
July 2023, the Company entered into an agreement to provide
a loan to Precious Link (UK) Limited
(“Precious Link”), a wine retailer, incorporated and registered in
England and Wales, located within the Southeast of
England. The loan is for a sum of
£200,000, is unsecured and attracts interest at 10 per cent. per
annum payable monthly in arrears. The loan is repayable on demand
by the Company and is repayable on 5 business days’ notice from
Precious Link.
On
20 July 2023, the Company sold its
46.8% equity stake in Dynamic Intertrade Agriculture (Pty) Ltd
(“DIA”) to Athena Trading Worldwide Limited, a private company, for
a consideration of £15,384.62, payable in cash on completion The
contractual completion date is 31 July
2023. The investment in DIA had been held in the balance
sheet of the Group as an asset held for sale since the decision to
sell it had been made.
