TIDMHPAC
RNS Number : 7067N
Hermes Pacific Investments PLC
26 September 2023
This announcement contains inside information for the purposes
of Article 7 of the UK version of Regulation (EU) No 596/2014 which
is part of UK law by virtue of the European Union (Withdrawal) Act
2018, as amended ("MAR"). Upon the publication of this announcement
via a Regulatory Information Service, this inside information is
now considered to be in the public domain.
26 September 2023
HERMES PACIFIC INVESTMENTS PLC
("Hermes" or the "Company")
Final results for the year ended 31 March 2022
Hermes Pacific Investments Plc (AIM: HPAC) today reports its
financial results for the year ended 31 March 2023 ("FY23",
"Period" or "Year")
Chairman's statement
I am pleased to present the annual results of Hermes for the
financial year ending on March 31, 2023. The Company has generated
income of GBP21,000 through the rental of our residential property
which was acquired in May 2022. The Company made a loss for the
year of GBP62,000 (FY22: a loss of GBP105,000), the improvement
reflects the rental income now being generated from this investment
property. Our unwavering commitment to cost minimisation remained
steadfast as we actively sought opportunities to allocate our
available funds.
At the close of the financial year, the Company's net assets
amounted to GBP3,432,000 (FY22 GBP3,486,000), a marginal decrease
from the previous year. Notably, in the prior financial period, we
adopted a new investment policy, primarily focusing on the property
sector, although not exclusively. We are pleased to report that we
successfully executed our first investment within the property
sector in May 2022. The Company purchased a two-bedroom leasehold
flat and a single garage in Westcliff-on-sea. The purchase price of
GBP594,907 was funded from the Company's existing cash resources.
This flat has now been rented out on assured shorthold tenancy
agreement.
The Company is not only benefitting from the rental income but
due to rising interest rates, our cash holdings have begun to
accrue interest through investments in treasury deposits.
Company Activities Review
Hermes operates as an investment company and has previously
committed funds in alignment with its investment policy,
particularly in companies engaged in financial activities within
the emerging market sector. These investments have consistently met
management's expectations. Our balance sheet remains robust, with
cash and treasury deposits amounting to GBP2.571 million as of
March 31, 2023, compared to GBP3.284 million in the prior fiscal
year. Over the course of this year, we diligently assessed
potential opportunities to deploy our financial resources but
regrettably did not identify any transactions that met our
criteria.
As we reflect upon the past year, it is imperative to
acknowledge the challenges and strategic decisions that have
influenced our operations. We observed a cautious approach within
our company regarding additional investments, primarily driven by
the prevailing economic conditions. The rapid escalation of
interest rates and the resultant contraction of yields in the
property market prompted this strategic decision. Our steadfast
commitment to prudent risk management necessitated a careful
evaluation of potential impacts on our investments, leading us to
exercise caution in deploying further capital at this juncture.
Despite the constraints we encountered, it is noteworthy that
the underlying fundamentals of the property market remained
relatively robust. The demand for properties in the United Kingdom
continued to display resilience, underpinned by a robust economy
and favourable demographics. However, we must acknowledge that,
akin to any investment, inherent risks persist.
One pivotal risk is the potential for a decline in property
prices. As an investment company, we maintain vigilant oversight of
market indicators to ensure the long-term stability and growth of
our investments. We remain cognizant of the prospect of price
adjustments and are prepared to proactively safeguard our
investments against adverse market conditions.
Looking forward, our commitment entails continued vigilance in
monitoring market trends, harnessing our expertise, and seeking
appealing investment opportunities that align with our risk
tolerance and long-term objectives. While we acknowledge the
uncertainties and potential challenges within the property market,
our optimism endures regarding the underlying strength and
resilience of the sector over the long term.
Haresh Kanabar
Chairman
26 September 2023
Contacts
Hermes Pacific Investments Plc www.hermespacificinvestments.com
Haresh Kanabar, Non-Executive Chairman Tel: +44 (0) 207 290
3340
WH Ireland Limited ( Nominated Adviser www.whirelandplc.com/capital-markets
& Broker)
Mike Coe/ Sarah Mather Tel: +44 (0) 207 220
1666
STATEMENT OF COMPREHENSIVE INCOME FOR THE YEARED 31 MARCH
2023
Year ended Year ended
31 March 31 March
Note 2023 2022
GBP'000 GBP '000
Continuing operations
Revenue 3 21
Cost of sales - -
g ross profit 21 -
Other operating income - -
Administrative expenses 4 (113) (111)
Operating loss (92) (111)
Finance income 30 6
Finance costs - -
Loss on ordinary activities before
tax (62) (105)
Tax expense 8 - -
L oss for the year from continuing
activities (62) (105)
Discontinued operations
Loss for the year from discontinued - -
operations
L oss for the year (62) (105)
Other comprehensive income
Gain/(losses) arising in the year
on investments
8 37
Total comprehensive loss for the
year (54) (68)
Basic and diluted loss per share
From continuing operations 9 (2.7)p (4.5)p
STATEMENT OF FINANCIAL POSITION AS AT 31 MARCH 2023
As at As at
31 March 31 March
2023 2022
Notes GBP'000 GBP'000
ASSETS
Non-current assets
Investment property 10 635 -
Investments 11 218 211
853 211
Current assets
Trade and other receivables 14 24 10
Treasury deposit 12 2,000 -
Cash and cash equivalents 13 571 3,284
2,595 3,294
LIABILITIES
Current liabilities
Trade and other payables 15 (16) (19)
(16) (19)
Net current assets 2,579 3,275
NET ASSETS 3,432 3,486
SHAREHOLDERS' EQUITY
Issued share capital 16 3,576 3,576
Share premium account 5,781 5,781
Share based payments reserve 139 139
Fair value reserve 46 38
Retained earnings (6,110) (6,048)
TOTAL EQUITY 3,432 3,486
CASH FLOW STATEMENT FOR THE YEARED 31 MARCH 2023
Note Year ended Year ended
31 March 31 March
2023 2022
GBP'000 GBP'000
Cash flows from operating activities 19 (108) (117)
Cash flows from investing activities
Acquisition of investment property (635) -
Investment income 30 6
Treasury deposit (2,000)
Net cash (used in)/from investing
activities (2,605) 6
Cash flows from financing activities
Other operating activities - -
Net cash from financing activities - -
(Decrease)/increase in cash and
cash equivalents (2,713) (111)
Cash and cash equivalents at start
of period 13 3,284 3,395
Cash and cash equivalents at end
of period 13 571 3,284
STATEMENT OF CHANGES IN EQUITY FOR THE YEARED 31 MARCH 2023
Share
Ordinary Deferred based
share share Share payments Retained Fair
capital capital premium reserve earnings value Total
reserve
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1 April 2021 2,333 1,243 5,781 139 (5,943) 1 3,554
Loss for the year - - - - (105) - (105)
Other comprehensive
income 37 37
At 1 April 2022 2,333 1,243 5,781 139 (6,048) 38 3,486
Loss for the year period - - - - (62) - (62)
Other comprehensive
income 8 8
___
At 31 March 2023 2,333 1,243 5,781 139 (6,110) 46 3,432
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARED 31 MARCH
2023
1. General information
Hermes Pacific Investments Plc is a public limited liability
company incorporated in the United Kingdom under the Companies
Act 2006. The nature of the Company's operations and its
principal activities are set out in the Directors' Report
on page 5. The Company's registered office is 22 Great James
Street, London, WC1N 3ES.
Statement of compliance
The Group financial statements were prepared in accordance with
UK adopted international accounting standards and with the requirements
of the Companies Act 2006.
At the date of approval of these financial statements, various
Standards and Interpretations affecting the Company, which have
not been applied in these financial statements, were in issue,
but not yet effective. The Directors have considered these new
standards and interpretations and do not expect them to have
a material impact on the Company.
2. Accounting policies
The following accounting policies have been applied consistently
in dealing with items which are considered material in relation to
the Company's financial statements.
Going concern
The financial statements have been prepared on a going concern
basis as, after making appropriate enquiries, the Directors have a
reasonable expectation that the Company has adequate resources to
continue in operational existence for the foreseeable future at the
time of approving the financial statements.
Critical accounting estimates and judgments
The preparation of financial statements in conformity with UK
adopted international accounting standards requires management to
make judgements, estimates and assumptions that affect the
application of the Company's accounting policies with respect to
the carrying amounts of assets and liabilities at the date of the
financial statements and the reported amounts of income and
expenses during the reporting year. The judgements, estimates and
associated assumptions are based on historical experience and
various other factors that are believed to be reasonable under the
circumstances, including current and expected economic conditions.
Although these judgements, estimates and associated assumptions are
based on management's best knowledge of current events and
circumstances, the actual results may differ. Estimates and
underlying assumptions are reviewed on an on-going basis. Revisions
to accounting estimates are recognised in the year in which the
estimate is revised and in any future years affected.
Management have not made any material estimates or judgements
that may result in a significant risk of causing a material
adjustment to the carrying amounts of assets and liabilities within
the next financial year.
Revenue
Revenue comprises rental income which is recognised on a
straight line and accruals basis over the rental period.
Deferred taxation
Deferred taxation is provided in full using the liability method
on temporary differences between the tax bases of assets and
liabilities and their carrying amounts in the consolidated
financial statements. Deferred tax is determined using tax rates
that have been enacted or substantially enacted by the balance
sheet date and are expected to apply when the related deferred tax
asset is realised, or the deferred tax liability is settled.
Deferred tax assets are recognised to the extent that it is
probable that future taxable profit will be available against which
the temporary differences can be utilised.
Cash and cash equivalents
Cash and cash equivalents include cash in hand, deposits held at
call with banks, other short term highly liquid funds with original
maturities of three months or less and bank overdrafts.
Investments
The Company carries its investments at fair value. Gains and
losses are either recorded in profit or loss or other comprehensive
income. For investments in equity instruments that are not held for
trading, this will depend on whether the company has made an
irrevocable election at the time of initial recognition to account
for the equity investment at fair value through other comprehensive
income.
Financial instruments
Financial assets and liabilities are recognised in the balance
sheet when the company becomes party to the contractual provisions
of the instrument.
Trade and other receivables
Trade receivables are measured at cost less any provision
necessary when there is objective evidence that the Company will
not be able to collect all amounts due.
Trade and other payables
Trade and other payables are not interest bearing and are
measured at original invoice amount.
Investment property
Investment property, which is property held to earn rentals
and/or for capital appreciation, is stated at fair value at the
reporting date. Gains or losses arising from changes in the fair
value of investment property are included in profit or loss for the
period in which they arise.
3. Revenue
Year ended Year ended
31 March 31 March
2023 2022
GBP'000 GBP'000
Rents received 21 -
21 -
Revenue represents rentals received in respect of the Company's
investment property which is rented under an assured shorthold
tenancy. The lease provides for an annual rental of GBP25,380,
expiring in May 2027.
4. Operating loss
Year ended Year ended
31 March 31 March
2023 2022
GBP'000 GBP'000
The operating loss is stated after
charging the following, included
in administrative expenses:
Staff costs 34 34
Other admin costs 79 77
113 111
5. Auditors' remuneration
Year ended Year ended
31 March 31 March
2023 2022
GBP'000 GBP'000
Audit fees:
- statutory audit of the accounts 12 12
12 12
6. Directors' emoluments
Year ended Year ended
31 March 31 March
2023 2022
GBP'000 GBP'000
Emoluments for qualifying services:
H Kanabar 22 22
J Morton 12 12
34 34
7. Employees and staff costs
The Company has no employees. Staff costs comprises payments
made in respect of services provided by the Directors.
8. Taxation
Year ended Year ended
31 March 31 March
2023 2022
GBP'000 GBP'000
Continuing operations:
Current tax charge - -
Adjustment in respect of prior
years - -
Current tax credit - -
Factors affecting the tax charge
for the period
Loss from continuing operations
before taxation (62) (105)
Loss from continuing operations
before taxation multiplied by standard
rate of corporation tax of 19%
(2022: 19%) (12) (20)
Effects of:
Temporary timing differences - -
Non deductible expenses - -
Depreciation in excess of capital
allowances - -
Unutilised tax losses 12 20
Current tax charge - -
The Company has approximately GBP4.2m (2022: GBP4.1m) of trading
losses to carry forward and offset against future trading
profits
9. Loss per share
Year ended Year ended
31 March 31 March
2023 2022
Basic
Loss from continuing activities
(GBP'000) (62) (105)
(62) (105)
Number of shares 2,333,295 2,333,295
Basic loss per share (p)
From continuing operations (2.7)p (4.5)p
(2.7)p (4.5)p
10. Investment property
GBP'000
Fair value
At 1 April 2022 -
Additions 635
At 31 March 2023 635
Net book value
At 31 March 2023 635
The investment property has been valued by the Directors at the
year end. This is based on the advice of local agents and having
considered property price movements since acquisition.
11. Investments
Investments
GBP'000
Cost or valuation
Brought forward 211
Fair value movement 7
At 31 March 2023 218
The Directors have elected to hold the investments at fair value
through OCI as it is their intention to hold these
for the long term.
12. Treasury Deposit
2023 2022
GBP'000 GBP'000
Treasury deposit 2,000 -
2,000 -
The treasury deposit is a deposit held with the Company's
bankers with a four month maturity.
13. Cash and cash equivalents
2023 2022
GBP'000 GBP'000
Cash at bank and in hand 571 3,284
571 3,284
14. Trade and other receivables
2023 2022
GBP'000 GBP'000
Other receivables 24 10
24 10
15. Trade and other payables
2023 2022
GBP'000 GBP'000
Trade payables 0 3
Accruals and deferred income 16 16
16 19
16. Share capital
2023 2022
GBP'000 GBP'000
Issued and fully paid
2,333,295 ordinary shares of 100p each 2,333 2,333
13,079,850 deferred shares of 9.5p each 1,243 1,243
3,576 3,576
All ordinary shares rank equally in respect of shareholders'
rights.
The deferred shares have no voting and dividend rights. On
winding up of the Company, they will be entitled to the nominal
value only after all ordinary shareholders receive the nominal
value of their shares plus GBP10m per share.
As at 31 March 2023 and 31 March 2022 the authorised share
capital was 3,500,000 ordinary shares of 100p and 200,000,000
deferred shares of 9.5p.
17 . Reserves
Share premium
This is the amount subscribed for share capital in excess of
nominal value.
Share based payments reserve
This is the fair value of equity instruments issued as share
based payments.
Fair value reserve
This is gains and losses arising on the revaluation of the
company's long term investments.
Retained earnings
This is all other net gains and losses and transactions with the
owners not recognised elsewhere.
18. Financial Instruments
Financial risk management
The Company's activities expose the Company to a number of risks
including credit risk, interest rate risk and liquidity risk. The
Board manages these risks through a risk management programme. The
fair value of the Company's assets and liabilities at 31 March 2023
are not materially different from their book value.
Financial assets at fair value
through other comprehensive income
2023 2022
GBP'000 GBP'000
Investments 218 211
218 211
The fair value measured is categorised within level 1 of the
fair value hierarchy.
Financial assets at amortised cost 2023 2022
GBP'000 GBP'000
Trade and other receivables 24 10
Cash and cash equivalents 571 3,284
Treasury deposit 2,000 -
2,595 3,294
Financial liabilities at amortised
cost 2023 2022
GBP'000 GBP'000
Trade and other payables 16 19
16 19
Credit risk
The Company monitors credit risk on an on-going basis and
manages risk by concentrating on trading and placing bank deposits
with reliable counterparties. The Company has no significant
concentration of credit risk associated with trading
counterparties. Credit risk predominantly arises from cash and cash
equivalents.
Interest rate risk
The Company has interest bearing assets. Interest bearing assets
comprise cash balances which earn interest at a variable rate. The
financial liabilities in the current year are all non-interest
bearing. The Company has not entered into derivatives transactions
and has not traded in financial instruments during the period under
review. The entire Company's debt is non-interest bearing there
would be no effect on the Company if interest rates changed.
Liquidity risk
The Company seeks to manage liquidity risk by ensuring
sufficient liquidity is available to meet foreseeable needs and to
invest cash assets safely and profitably. All cash and cash
equivalents are immediately accessible.
Price risk
The Company's exposure to equity securities price risk arises
from investments held by the Company and classified in the
statement of financial position either as at fair value through
other comprehensive income or at fair value through profit or loss.
The risk is managed by regular reviews of the portfolio of
investments held to ensure that exposure to price movements is
within acceptable limits.
The maturity dates of the Company's financial instruments are
shown below and are based on the period outstanding at the balance
sheet date up to the contractual maturity date.
Between Between
Less 6 months 1 and
than and 1 5 years Total
6 months year
GBP'000 GBP'000 GBP'000 GBP'000
2023
Financial Assets
Variable interest rate
instruments 2,571 - - 2,571
Non-interest bearing 24 - - 24
2,595 - - 2,595
Financial Liabilities
Non-interest bearing 16 - - 16
16 - - 16
Between Between
Less 6 months 1 and
than and 1 5 years Total
6 months year
GBP'000 GBP'000 GBP'000 GBP'000
2022
Financial Assets
Variable interest rate
instruments 3,284 - - 3,284
Non-interest bearing - 10 - 10
3,284 10 - 3,294
Financial Liabilities
Non-interest bearing 19 - - 19
19 - - 19
19. Cash flows from operating activities
Year ended Year ended
31 March 31 March
2023 2022
GBP'000 GBP'000
Operating loss (92) (111)
Depreciation of property, plant and - -
equipment
Operating cash flows before movements
in working capital (92) (111)
(Increase)/Decrease in trade and
other receivables (14) (1)
(Decrease)/Increase in trade and
other payables (2) (5)
Cash flows from operating activities (108) (117)
20. Related party transactions
Key Management Personnel and Director Transactions
A number of key management personnel, or their related parties,
hold positions in other entities that result in them having control
or significant influence over the financial and operating policies
of these entities.
A number of these entities transacted with the Company during
the year. The terms and conditions of these transactions with key
management personnel and their related parties were no more
favourable than those available, or which might reasonably be
expected to be available, on similar transactions to non-key
management personnel related entities on an arm's length basis.
The aggregate value of transactions related to key management
personnel and entities over which they have control or significant
influence was GBP33,600 (2022: GBP33,600).
During the year, the Company used the services of Poonam &
Roshni Limited totalling GBP21,600 (2022: GBP21,600).
H Kanabar is a director of both companies. No balance was
outstanding at the year end (2022: Nil).
During the year the Company used the services of Thirty Acre
Stables totalling GBP12,000 (2022: GBP12,000). J Morton is the
owner of that business. No balance was outstanding at the year end
(2022: Nil).
The compensation of key management is as disclosed in the
Directors' emoluments note.
21. Annual report
The Annual Report will be posted to shareholders shortly and
will be available on the Company's website
http://www.hermespacificinvestments.com. Copies will be available
thereafter in hard copy format from the Company's registered
office, 22 Great James Street, London WC1N 3ES.
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