TIDMOBOR
RNS Number : 8161X
Starcrest Education Limited
01 September 2022
1 September 2022
Starcrest Education Limited
("Starcrest" or the "Company" or the "Group")
Interim Results for the six months to 30 June 2022
Starcrest Education Limited (LSE: OBOR ), the international
developer and operator of education services in Europe, is pleased
to announce its unaudited results for the six months to 30 June
2022.
Highlights
-- As of 30 June 2022, the Group had cash balances of GBP17,285 (2021: GBP652,690)
-- Loss before tax of GBP212,831 (2021: GBP415,827)
-- On 23 March 2022, the Company announced that it had signed an
agreement with Fairview International School (UK) Limited, for an
advance of up to GBP1 million ("Advance Agreement"). As part of the
terms of the Advance Agreement, Starcrest and Fairview have also
agreed to acquire an interest in several Fairview IB World Schools
(together the "Proposed Acquisition") subject to negotiation on the
specific details.
-- Post-period end on 15 August 2022, appointment of Shipleys
LLP to conduct an audit of the proposed enlarged group for the year
ending 31 December 2022
Jeff Zhang, Executive Director of Starcrest, commented:
"We are pleased to announce Starcrest's interim results for the
six months to 30 June 2022.
"We believe that the acquisition of Fairview Schools provides a
valuable opportunity for Starcrest and its shareholders. The
Board's focus remains on progressing the required steps to complete
the transaction. Alongside this, however, in line with the
Company's revised strategy and with its extensive experience and
contacts, we will continue to seek further acquisition targets
across the education sector in the UK, Europe and Asia, which the
Board believes demonstrates potential for long-term growth.
"The Directors look forward to providing further updates to the
market in due course."
- Ends -
Enquiries:
Starcrest Education
Jeff Zhang, Executive Director +44 (0) 7768 031454
Guild Financial Advisory (Financial
Adviser)
Ross Andrews +44 (0) 7973 839767
Yellow Jersey PR (Financial PR)
Sarah Hollins
Henry Wilkinson +44 (0) 20 3004 9512
Notes to editors:
Starcrest is an international developer and operator of
education services in Europe. The Company was established to seek
acquisition opportunities in the international education sector and
to provide premier education services and products in the UK and to
countries in Europe.
Starcrest listed on the Main Market of the London Stock Exchange
on 31 January 2019 under the ticker symbol (LSE: OBOR). Further
information can be found on the Company's website at
https://www.starcresteducation.com .
Strategic Report
Introduction
I am very pleased to report the Company's interim results for
the period ended 30 June 2022.
Strategy and Transactions
As outlined in Starcrest's 2021 final results on 23 March 2022,
we were pleased to announce that the Company had signed an
agreement with Fairview International School (UK) Limited, for an
advance of up to GBP1 million ("Advance Agreement"). As part of the
terms of the Advance Agreement, Starcrest and Fairview have also
agreed to acquire an interest in several Fairview IB World Schools
(together the "Proposed Acquisition") subject to negotiation on the
specific details.
Fairview is the largest network of IB World Schools with five
campuses across Malaysia and Scotland being the latest addition to
the network. Fairview has been in education for over four decades
and was recognised as among the Top 1% Global IB Schools for
excellence in its academic achievement for the last two years.
Starcrest continues to advance the respective workstreams in
respect of the Proposed Acquisition. In this regard, the Company is
pleased to confirm that it has determined the acquisition targets,
and appointed professional advisers for the acquisition exercise. A
further announcement will be made as and when appropriate.
The agreement with Fairview has provided an advance of up to
GBP1 million of which the Company has drawn GBP200,000 as of 30
June 2022. The Board has reviewed its cash flows for a period of at
least 12 months from the date of these financial statements, having
taken into account optimised overheads, projected costs and
settlement schedule associated with the due diligence on the
Proposed Acquisition. Directors have a reasonable expectation that
the Company and Group will have sufficient resources to meet their
obligations as they fall due.
The Proposed Acquisition is subject to, amongst other things,
legal and financial due diligence, therefore the Company is unable
to provide further information at this stage about the terms of the
Proposed Acquisition. If the Proposed Acquisition is successful, it
will amount to a reverse takeover under the Listing Rules.
The Board believes that Fairview provides a valuable opportunity
for Starcrest and its shareholders. The Board is therefore
progressing matters and will update shareholders as soon as they
are able. The Company is focused on completing the transaction with
Fairview, however there is no certainty that the transaction will
complete which includes the raising of new monies to fund the
consideration. In the event the transaction does not complete, the
Company will continue to seek another potential acquisition and to
ensure that the Company has sufficient funding. The Company
believes that its principal risks and uncertainties remain
unchanged from those disclosed in the 2021 annual report.
Post-period, on 15 August 2022, Shipleys LLP has been appointed
to conduct an audit of the proposed enlarged group for the year
ended 31 December 2022; and a review of interim financial
information for the six months ended 30 June 2022.
Results
Starcrest made approximately GBP221,896 loss for the period
ended June 2022 (2021: GBP418,219). The losses reported in this
period are attributed to Directors' fees, administration and other
costs .
The majority of the losses reported in the comparative period to
30 June 2021, representing approximately GBP246,000, were
attributed to Directors' fees, administration and other costs The
remaining expenditure related to professional fees and associated
costs relating to the due diligence cost for acquisition targets.
Reverse takeover expenses relate to the 2021 acquisition project
which was aborted.
Board
With the Company's intention to move from a shell to an
operating company, Starcrest will strengthen its Board through the
appointment of a new Chairman and an Executive Director. More
details will be provided on this in due course.
Summary and Outlook
First and foremost, the Board's focus remains on progressing the
required steps to complete the acquisition of the Fairview Schools.
Alongside this, however, in line with the Company's revised
strategy and with its extensive experience and contacts, the Board
continues to seek further acquisition targets across the education
sector in the UK, Europe and Asia, which the Board believes
demonstrates potential for long-term growth.
We look forward to providing further updates in due course.
Xiao Jun Zhang
Executive Director
31 August 2022
UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL
STATEMENTS
FOR THE PERIODED 30 JUNE 2022
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
6 months 6 months
ended ended
Note 30/06/2022 30/06/2021
Unaudited Unaudited
GBP GBP
Administrative expenses (209,720) (415,827)
------------- -----------------------------------
Operating loss 10 (209,720) (415,827)
------------- -----------------------------------
Finance costs (3,110) -
------------- -----------------------------------
Loss before taxation (212,831) (415,827)
Income tax - -
------------- -----------------------------------
Loss for the period (212,831) (415,827)
------------- -----------------------------------
Other Comprehensive (loss)/gain
Exchange gain arising on translation
to presentation currency (9,065) (2,391)
------------- -----------------------------------
Total comprehensive loss attributable
to equity holders of the Company
for the period (221,896) (418,219)
------------- -----------------------------------
Loss per share - basic and
diluted (pence per share) 13 (0.99) (1.93)
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Note As at As at
30/06/2022 31/12/2021
Unaudited Audited
GBP GBP
Current assets
Cash and cash equivalents 14 17,285 42,427
Trade and other receivables 15 1,993 1,441
Total current assets 19,277 43,868
------------ --------------------------
Total assets 19,277 43,868
============ ==========================
Equity and liabilities
Capital and reserves
attributable to owners
of the company
Ordinary shares 17 215,600 215,600
Share premium 3,454,364 3,454,364
Retained earnings (4,547,991) (4,335,160)
Foreign exchange reserves 76,379 85,444
------------ --------------------------
Total equity ( 801,648) (579,752)
------------ --------------------------
Current liabilities
Trade and other payables 16 820,925 623,620
Lease liabilities - -
Total current liabilities 820,925 623,620
Total equity and liabilities 19,277 43,868
============ ==========================
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE PERIODED 30 JUNE 2022
Share Share Other Retained Foreign Total
capital premium reserves earnings exchange equity
GBP GBP GBP GBP GBP GBP
Balance at 1 January
2022 215,600 3,454,364 - (4,335,160) 85,444 (579,752)
Loss for the period - - - (212,831) - (212,831)
Other comprehensive
loss for the
financial
period - - - - (9,065) (9,065)
--------- ----------- --------- ------------- --------- -----------
Balance at 30 June
2022 215,600 3,454,364 - (4,547,991) 76,379 (801,648)
(Unaudited)
--------- ----------- --------- ------------- --------- -----------
FOR THE PERIODED 30 JUNE 2021 Share Share Other Retained Foreign Total
capital premium reserves earnings exchange equity
GBP GBP GBP GBP GBP GBP
Balance at 1
January 2021 215,600 3,454,364 - (2,943,779) (96,153) 822,338
Loss for the
period - - - (415,827) - (415,827)
Other
comprehensive
gain for the
financial
period - - - - (2,391) (2,391)
Balance at 30
June
2021
(Unaudited) 215,600 3,454,364 - (3,359,606) 93,761 404,119
-------- ---------- --------- ------------ --------- ----------
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEARED 31 DECEMBER 2021
Share Share Other Retained Foreign Total
capital premium reserves earnings exchange equity
GBP GBP GBP GBP GBP GBP
Balance at 1
January 2021 215,600 3,454,364 - (2,943,779) 96,153 822,338
Loss for the
year - - - (1,391,381) (1,391,381)
Other
comprehensive
gain for the
year - - - - (10,709) (10,709)
-------- ---------- --------- ------------ --------- ------------
Balance at 31
December
2021 (Audited) 215,600 3,454,364 - (4,335,160) 85,444 (579,752)
-------- ---------- --------- ------------ --------- ------------
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
Period Ended 30 JUNE 2022
30/06/2022 30/06/2021
Unaudited Unaudited
GBP GBP
Cash flows from operating activities
Operating loss (212,831) (415,827)
Depreciation - -
Finance cost - -
(Increase) in receivables 15 (552) (18,590)
(Decrease) in payables 16 (11,784) (365,595)
------------- -------------
Net cash generated from operating
activities (225,167) (800,012)
------------- -------------
Cash flows from financing activities
Transaction costs deducted from - -
equity
Proceeds from borrowings 200,000
Principal paid on lease liabilities - -
Interest paid on lease liabilities - -
------------- -------------
Net cash used in financing 200,000 -
activities
------------- -------------
Net decrease in cash, cash
equivalents (25,167) (800,012)
Cash, cash equivalents at beginning
of the period 42,427 1,454,672
Exchange gains on cash and cash
equivalents 24 (1,970)
------------- -------------
Cash, cash equivalents at end
of the period 14 17,285 652,690
============= =============
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL
STATEMENTS
1. GENERAL INFORMATION
Starcrest Education Limited ("the Company") was incorporated and
registered in the Cayman Islands as a private company limited by
shares on 23 May 2018 under the Companies Law (as revised) of The
Cayman Islands, with the name Starcrest Education The Belt &
Road Limited, and registered number 337619. The Company has
officially changed the name to Starcrest Education Ltd on 30
September 2021, the RNS was released on 5 October 2021
The subsidiaries included in these condensed consolidated
financial statements were incorporated in November 2019.
The Company's registered office is located at Cricket Square,
Hutchins Drive PO Box 2681, Grand Cayman KY1-1111, Cayman
Islands.
2. PRINCIPAL ACTIVITIES
The principal activity of the Group is to seek education related
acquisition opportunities in Europe.
3. RECENT ACCOUNTING PRONOUNCEMENT
a) New interpretations and revised standards effective for the
period ended 30 June 2022
The International Accounting Standards Board (Board) has issued
an amendment to IFRS 16 Leases to make it easier for lessees to
account for COVID-19-related rent concessions such as rent holidays
and temporary rent reductions
The Group's had no lease contract during the interim period.
b) Standards and interpretations in issue but not yet
effective
There are a number of standards and interpretations which have
been issued by the International Accounting Standards Board that
are effective for periods beginning subsequent to 1 January 2022
(the date on which the Company's next annual financial statements
will be prepared from) that the Company has decided not to adopt
early. The Directors do not believe these standards and
interpretations will have a material impact on the financial
statements once adopted.
4. BASIS OF PREPARATION
These condensed consolidated interim financial statements have
been prepared in accordance with IAS 34 Interim Financial Reporting
as adopted by the UK adopted International Accounting Standards and
prepared under the historic cost convention. The comparative
figures as at 31 December 2021 have been extracted from the Group's
Financial Statements for that financial year, but do not constitute
these accounts.
The Company's functional currency is USD. The Company listed its
shares on the main market of the London Stock Exchange on 31
January 2019. The directors have decided to present the
consolidated interim financial information in Pounds Sterling
(GBP), which is the Group's presentation currency, as the Company
is listed in the UK.
On 11 March 2022, the Company signed a loan agreement with
Fairview International School (UK) Limited (Fairview) for an
advance of up to GBP1,000,000. The loan is made available in
tranches, with GBP253,300 received to date and further tranches
totalling GBP746,700 to be made available for expenses incurred by
the Group. The loan is repayable on the earlier of the successful
completion of the reverse takeover of the Company by Fairview and
the acquisition of certain Fairview IB World Schools (the Proposed
Acquisition) or 12 months from the date of the loan agreement. The
agreement contains a call option over up to 75% of the share
capital of the Company which can be exercised at any time. The
Directors are confident in their ability to execute the Proposed
Acquisition, to raise sufficient capital from new shareholders, to
agree extended payment terms with their creditors and, if
necessary, obtain alternative sources of funds as described above.
The Directors have received a letter of support from the immediate
parent company stating that it will not seek repayment of the
amounts owed by the Company prior to completing the Proposed
Acquisition.
On the basis of the above, Directors have a reasonable
expectation that the Company and Group will have sufficient
resources to meet their obligations as they fall due. Accordingly,
these financial statements have been prepared on a going concern
basis.
5. SIGNIFICANT ACCOUNTING POLICIES
5.1 Foreign currency translation
Transactions in currencies other than the Company's functional
currency (foreign currencies) are recognised at the rates of
exchange prevailing on the dates of the transactions. At each
reporting date, monetary assets and liabilities that are
denominated in foreign currencies are retranslated at the rates
prevailing at that date. Non-monetary items carried at fair value
that are denominated in foreign currencies are translated at the
rates prevailing at the date when the fair value was determined.
Non-monetary items that are measured in terms of historical cost in
a foreign currency are not retranslated.
Exchange differences are recognised in profit or loss in the
period in which they arise.
Results at 30 June 2022 are translated into the presentation
currency. Assets and liabilities are translated at the closing rate
while income and expenses are translated at exchange rates at the
dates of the transactions. Differences arising are recognised in
Other Comprehensive Income in the period in which they arise
(foreign currency translation reserve).
5.2 Financial instruments
A financial asset or a financial liability is recognised only
when the Group becomes a party to the contractual provisions of the
instrument.
Financial instruments are initially recognised at the
transaction price as this represents fair value, unless the
arrangement constitutes a financing transaction, where it is
recognised at the present value of the future payments discounted
at a market rate of interest for a similar instrument.
Financial assets
All financial assets are initially recognised at fair value,
less transaction costs. Subsequent to initial recognition, they are
recorded at amortised cost.
Financial liabilities
Financial liabilities are initially recognised at fair value.
Subsequent to initial recognition, they are recorded at amortised
cost.
5.3 Share Capital
Ordinary shares are classified as equity. Incremental costs
directly attributable to the issue of ordinary shares or options in
relation to ordinary shares are shown in equity as a deduction, net
of taxation, from the proceeds.
5.4 Cash and cash equivalents
Cash and cash equivalents include cash in hand, deposits held on
call with banks and other short term highly liquid investments that
are readily convertible into known amounts of cash and which are
subject to an insignificant risk of changes in value.
5.5 Earnings per share
Basic earnings per share is computed using the weighted average
number of shares outstanding during the period. Diluted earnings
per share is computed using the weighted average number of shares
during the period plus the dilutive effect of dilutive potential
ordinary shares outstanding during the year.
5.6 Leases
Where the Group enters into leases that are longer than 12
months, the Group recognises right-of-use assets measured at an
amount equal to the lease liability. The lease liability is
measured at the present value of the remaining lease payments,
discounted using the Group's incremental borrowing rate at date of
lease commencement. Lease modifications are accounted for at the
effective date of the lease modification.
6. ACCOUNTING ESTIMATES AND JUDGEMENTS
Preparation of financial information in conformity with IFRS
requires management to make judgements, estimates and assumptions
that affect the application of accounting policies and the reported
amounts of assets, liabilities, income and expenses.
There are no significant accounting estimates or judgements that
affect reported amounts of assets, liabilities, income and expenses
in this period.
7. FINANCIAL RISK MANAGEMENT
The Group has exposure to the liquidity risk, foreign currency
risk and capital risks from its use of financial instruments.
Credit, interest rate and market risks are not considered to be
material to the Group. The Group is not subject to any externally
imposed capital requirements.
The Group's financial instruments consist mainly of cash and
accounts receivable and payable.
a. Liquidity risk
Liquidity risk is the risk that the Group will encounter
difficulty in meeting the obligations associated with its financial
liabilities. The Group's approach to managing liquidity is to
ensure, as far as possible, that it will always have sufficient
liquidity to meet its liabilities when due, under both normal and
stressed conditions, without incurring unacceptable losses or
risking damage to the Group's reputation.
The Group's financial liabilities comprise trade payables,
amounts due to the parent company and accruals.
The Group's financial assets comprise cash and cash equivalents,
trade and other receivables.
The Group has sufficient cash to meet their liabilities as they
fall due.
b. Foreign currency risk
The Company keeps majority of cash in British pound in UK HSBC
bank account. There was no foreign currency payment during the
period. Financial risks of variations in foreign currency exchange
rates have been significantly reduced as a result.
c. Credit risk
Credit risk refers to the risk that counterparty will default on
its contractual obligations resulting in financial loss to the
Group. Credit allowances are made for estimated losses that are
anticipated to be incurred by the reporting date.
8. CAPITAL MANAGEMENT
The Group actively manages the capital available to fund the
Group, comprising equity and reserves. The Group's objectives when
maintaining capital is to safeguard the entity's ability to
continue as a going concern, so that it can continue to provide
returns for shareholders.
9. SEGMENT REPORTING
IFRS 8 defines operating segments as those activities of an
entity about which separate financial information is available and
which are evaluated by the Board of Directors to assess performance
and determine the allocation of resources. The Board of Directors
are of the opinion that under IFRS 8 the Group has only one
operating segment. The Board of Directors assess the performance of
the operating segment using financial information which is measured
and presented in a manner consistent with that in the Financial
Statements. Segmental reporting will be reviewed and considered in
light of the development of the Group's business over the next
reporting period.
10. OPERATING LOSS
The operating loss is stated after charging:
6 months ended 6 months ended
30 June 2022 30 June 2021
Lease expense - -
11. STAFF COSTS AND KEY MANAGEMENT EMOLUMENTS
Period ended Period ended
30 June 2022 30 June 2021
GBP GBP
Key management emoluments
Remuneration
131,528 177,500
Directors 86,528 102,500
Staff costs 45,000 75,000
12. TAXATION
The Company is incorporated in the Cayman Islands, and its
activities are subject to taxation at a rate of 0%.
The Company's wholly owned subsidiaries, Starcest Education UK
PLC and Starcest Education Management (UK) Ltd are incorporated in
England and Wales, and its activities are subject to taxation at a
rate of 19%. For the period to 30 June 2022 the entities have made
a taxable loss. No deferred tax asset has been recognised.
13. EARNINGS PER SHARE
The Company presents basic and diluted earnings per ordinary
share information for its ordinary shares. Basic earnings per share
is calculated by dividing the loss attributable to ordinary
shareholders of the Company by the weighted average number of
ordinary shares in issue during the reporting period.
There is no difference between the basic and diluted loss per
share.
6 months ended 6 months ended
30/06/2022 30/06/2021
-------------------------------------------- ---------------------- ----------------------
Loss attributable to ordinary shareholders (212,831) (415,827)
Weighted average number of shares 21,560,000 21,560,000
Losses per share (expressed as
pence per share) (0.99) (1.93)
14. CASH AND CASH EQUIVALENTS
Unaudited Audited
30/06/2022 31/12/2021
GBP GBP
Cash and cash equivalents 17,285 42,427
----------------------- -----------------------
Cash at bank earns interest at floating rates based on daily
bank deposit rates.
15. TRADE AND OTHER RECEIVABLES
Unaudited Audited
30/06/2022 31/12/2021
GBP GBP
VAT and other receivables 1,993 1,441
----------------------- -----------------------
1,993 1,441
16. TRADE AND OTHER PAYABLES
Unaudited Audited
30/06/2022 31/12/2021
GBP GBP
Trade payables 36,975 229,758
Amounts due to the parent company 225,782 216,726
Other creditors 203,110 -
Accruals 355,058 107,133
----------------------- -----------------------
820,925 623,620
All payables are financial liabilities measured at amortised
cost.
Amounts due to the parent company are unsecured, interest free
and repayable on demand.
17. SHARE CAPITAL
Number of shares Nominal value
GBP GBP
Authorised
Ordinary shares of GBP GBP0.01 each 1,000,000,000 10,000,000
Issues and fully paid
Issue of ordinary shares of GBP0.01 each 21,560,000 215,600
------------------------- ----------------------
18. ULTIMATE CONTROLLING PARTY
The Company's immediate parent company is Starcrest Education
Management Company Ltd. The Company's ultimate parent company is
Fubao Group Holdings Ltd. The ultimate controlling party is Mr Peng
Luo, who is also a director of the Company.
19. RESERVES
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.
Other reserve Consideration received for shares
which are not yet issued.
Retained earnings All other net gains and losses
and transactions not recognised
elsewhere.
Foreign exchange reserve Gains/losses arising on retranslation
of net assets from functional
to presentation currency.
20. RELATED PARTY TRANSACTIONS
As at 30 June 2022, an amount of GBP225,782 (unaudited) (31
December 2021 (audited): GBP216,729) was owed to Starcrest
Education Management Company Ltd. This amount mainly arose from
business expenses paid on behalf of the Group by the parent
company.
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END
IR EALPFDSNAEFA
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