TIDMRGP
RNS Number : 2088U
Ross Group PLC
24 March 2023
Ross Group Plc Half Yearly Financial Report 31(st) December 2022
HALF YEARLY FINANCIAL REPORT
FOR THE TWELVE MONTHSED 31 DECEMBER 2022
Financial Summary (12 months to 31 December 2022) 2022 2021
GBP'000 GBP'000 Change
Group Revenue - - -
Gross Profit/(Loss) - - -
Profit/(Loss) before tax (854) (85) 1,004.7%
Basic earnings per share -0.35p -0.04p 875.0%
Diluted earnings per share -0.29p -0.03p 966.7%
Chairman's Statement
For the half year (interim) period to the 31(st) December 2022
I would like to report that, during this particular period, Ross Group PLC
("the Group") decided to change its financial year end to the 30th June and,
as a result of this change, the reporting period from 1st January 2022 to
31st December 2022 is hereby termed as an interim or half year set of Accounts.
This is primarily due to the Board of Directors' restructuring and implementation
of its planned business strategy, notwithstanding continuing to endure exceptional
and extended circumstances related to COVID and its consequential economic
effects, all of which as a result has therefore subsequently resulted in
a net loss after tax of GBP854,000 without revenue.
The Board during the last half of 2022 announced a specific Supply Chain
Management Agreement ("SCMA") and is in the process of endeavouring to integrate
this respective start-up business within the existing overall operations,
since the AAG acquisition in 2019/2020 which was subsequently effected by
COVID during the last 2 years and required restructuring.
Ross Diversified Ltd, a subsidiary, has been renamed as the Energy Group
International Ltd ("EGIL") as a result of the SCMA and is in the process
of becoming a more defined water, hydrogen, oil and gas specialist supply
chain management and service-providing operation, including, but not limited
to, supply chain financing.
Consequently, this division is currently in detailed discussions with a
number of companies that are wanting to engage in such specialist supply
chain management services and related operations.
As a result, the Group is therefore currently in the process of implementing
and/or amending its specialistic supply chain management protocols, procedures
and respective disciplines, in order to put in place a more appropriate robust
financial and investment infrastructure through the adoption and application
of a more horizontal integrational sub-strategy that will hopefully place
the Group to be in a better position so as to try to provide more efficient
and successful specialist supply chain management services in the foreseeable
future.
The Group has also recently approved and appointed Mr Stephen Johanns to
become a Group Director and also the CEO of EGIL. The Board believes that
his specialist skill set in both the Group's supply chain management services
and also in areas of energy and infrastructure, as well as his own expertise
in critical mineral supply chain solutions, will help the Group through EGIL
produce some exciting opportunities in the very near future.
Whilst there has been no revenue during this particular period from any
outside third party contracts, it is now the Group's intention to significantly
revert and re-implement resources that will enable the Group to grow its
global supply chain services and produce a more substantial revenue stream
in the future.
Business Outlook
For the first half of 2023 the Board will continue, along with our team
of Advisors and Consultants, to work tirelessly with our specialist supply
chain management team in trying to successfully build a business of a specialist
supply chain strategy centered around its Standard Incorporate Coding of
Mining & Mineral business in order to try and ensure that the Group has a
more balanced structure that can allow and enable the exploring other opportunities
that may also arise during this uncertain and unique time.
The Directors have prepared preliminary cashflow forecasts in accordance
with the new financial year. These cashflows have been sensitized to assess
the adequacy of cash and funding available should future economic effects
of recession and/or inflation impinge the activities of the Group. Certain
Directors have also confirmed to be ably to provide additional independent
financial support should additional resources be required. Based on the sensitivity
testing and additional resources available the Directors are satisfied the
Group can continue as a going concern for the foreseeable future.
Principal Risks and Uncertainties
The main risk to the existing operations of the Group is the possibility
of depleting necessary working capital in the event of not being able to
achieve enough specialist supply chain management service revenues and/or
incurring excessive expenses and/or overhead within a viable period of time.
The Board is both fully aware of these risks and, as a result, has always
endeavoured to managed its cash and cashflow conservatively and prudently;
having already ensured that its exposure to any RGP-525 or AAG related liabilities
in this instance are primarily limited to its initial investment. In addition,
the Board is equally endeavouring to ensure that funds are being made available
to the Group, whilst also exploring other opportunities, specifically in
the supply chain of water, hydrogen, oil and gas sectors for future growth.
Your Directors are therefore reasonably confident that the Group currently
has both the financial resources and capability to fund existing expenses
for future specialist supply chain management growth.
Dividend
No ordinary interim dividend is proposed after considering the result for
the first half of the year, and the existing deficiency of retained reserves.
I would very much like to thank the members of the Board of Directors, as
well as our contractors, consultants and advisors for all their continued,
and highly appreciated, support, expertise and hard work.
Finally, as always, on behalf of our Board of Directors, I would also like
to personally extend my sincere thanks to our extraordinarily loyal and also
new shareholders for all their continued confidence, patience and truly exceptional
understanding.
Barry Richard Pettitt
Chairman
Approved: 24th March 2023
CONDENSED CONSOLIDATED INCOME STATEMENT UNAUDITED
12 months 6 months Year
ended 31 ended ended
December 30 June 31 Dec
2022 2021 2021
GBP'000 GBP'000 GBP'000
Restated
Group Revenue - - -
Gross Profit - - -
Profit / (Loss) before Finance Cost (571) 131 (1,873)
---------- --------- --------
Finance Cost 283 216 703
(Loss) before Taxation (854) (85) (2,576)
---------- --------- --------
Taxation - - -
(Loss) for the Period (854) (85) (2,576)
---------- --------- --------
Earnings per share (pence) -0.35 -0.04 -1.11
Diluted earnings per share (pence) -0.29 -0.03 -0.85
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY UNAUDITED
Share Accumulated Translation Other
Capital Losses Reserve Reserves
Restated Restated
Balance at 1 Jan 2021 11,218 (39,820) (199) 15,384
(Loss) / Profit for the - (85) - -
period
Foreign exchange adjustment - - (13) -
--------- ------------ ------------ ----------
Total comprehensive income
/ (deficit) - (85) (212) -
--------- ------------ ------------ ----------
Balance at 30 June 2021 11,218 (39,905) (212) 15,384
--------- ------------ ------------ ----------
(Loss) / Profit for the - (2,491) - -
period
Foreign exchange adjustment - - - -
--------- ------------ ------------ ----------
Total comprehensive income - (2,491) - -
/ (deficit)
--------- ------------ ------------ ----------
Share issue 14 - - -
Movement on convertible - 453 - -
loans
Balance at 31 Dec 2021 11,232 (41,943) (212) 15,384
--------- ------------ ------------ ----------
Balance at 1 Jan 2022 11,232 (41,943) (212) 15,384
(Loss) / Profit for the
period
- (854) - -
Foreign exchange adjustment - - (387) -
Total comprehensive income
/ (deficit) - (854) (387) -
--------- ------------ ------------ ----------
Share issue 10 - - -
Balance at 31 December
2022 11,242 (42,797) (599) 15,384
--------- ------------ ------------ ----------
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION UNAUDITED
12 months 6 months Year Ended
ended 31 ended 30
December June 31 Dec
2022 2021 2021
GBP'000 GBP'000 GBP'000
Restated
Non Current Assets 32 802 68
Current Assets:
Trade and Other Receivables 114 129 117
Cash and Cash Equivalents 1 307 209
115 436 326
Total Assets 147 1,238 394
---------- --------- -----------
Equity and Liabilities
Shareholders' Equity:
Share Capital 11,242 11,218 11,232
Share Premium Account 3,708 3,146 3,540
Other Reserves 15,384 15,384 15,384
Convertible debentures 4,692 5,145 4,692
Translation reserve (599) (212) (212)
Retained Earnings (42,797) (39,905) (41,943)
---------- --------- -----------
Total Equity (8,370) (5,224) (7,307)
Non-Current Liabilities:
Lease Liabilities 12 28 10
Long Term Borrowings 3,345 2,552 3,003
Provisions 813 - 813
Current Liabilities:
Trade and Other Payables 3,716 3,178 3,315
Shareholders funds in advance - 378 -
Lease Liabilities 20 35 37
Bank Overdraft and Loans 611 291 523
---------- --------- -----------
Total Liabilities 8,517 6,462 7,701
Total Equity and Liabilities 147 1,238 394
---------- --------- -----------
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS UNAUDITED
12 months 6 months Year Ended
ended 31 ended 30
December June 31 Dec
2022 2021 2021
GBP'000 GBP'000 GBP'000
Net Cash From/(Used In) Operating
Activities (516) (281) (885)
Net Cash Used In Investing
Activities (1) 567 793
Cash Flows From Financing Activities:
Amount withdrawn by Directors 38 5 -
Issue of ordinary shares 178 - 408
Net Increase/(Decrease) In
Borrowings and Lease Liabilities 389 (75) (198)
---------- --------- -----------
Net Cash Flow From Financing
Activities 88 (70) 210
---------- --------- -----------
Net Increase/(Decrease) In
Cash and Cash Equivalents (208) 216 118
Cash and Cash Equivalent at
Beginning of Period 209 91 91
---------- --------- -----------
Cash and Cash Equivalent at
End of Period 1 307 209
---------- --------- -----------
Notes to the Interim Report
(1) The financial information contained in these statements for the twelve
months ended 31 December 2022 and 30 June 2021 is unaudited and does not
constitute statutory
Accounts as defined in section 434 of the Companies Act 2006.
These statements are prepared in accordance with International Financial
Reporting Standards (IFRS) as adopted by the UK.
The interim financial statements have been prepared on the basis of the
accounting policies set out in the audited statutory accounts for the year
ended
31 December 2021.
The comparative information at 30 June 2021 has been restated as detailed
in note 11.
(2) Reconciliation of Operating (Loss) / Profit to Net Cash Flows From Operating
Activities 12 months 6 months Year Ended
ended 31 ended 30
December June 31 Dec
2022 2021 2021
GBP'000 GBP'000 GBP'000
Restated
Operating Profit / (Loss) (571) 134 (1,873)
Profit on sale of fixed assets - (578) (337)
Exchange differences (391) (13) (4)
Depreciation and Amortisation 42 260 525
(Increase)/ Decrease In Trade
and Other Receivables 3 135 212
Increase/(Decrease) In Trade
and Other Payables 401 (219) 592
Net Cash Generated From/(Used
In) Operations (516) (281) (885)
(3) No ordinary interim dividend is proposed for 2022 (2021 - GBPNil).
(4) The comparative cash flow for the year ended 31 December 2021 has been
extracted from the audited accounts. The cash flows for the six months ended
30
June 2021 and twelve months ended 31 December 2022 are unaudited.
(5) Reconciliation of Movements In Equity 12 months 6 months Year Ended
ended 31 ended 30
December June 31 Dec
2022 2021 2021
GBP'000 GBP'000 GBP'000
Restated
Share Premium Account
Brought Forward 3,540 3,146 3,146
Movement 168 - 394
---------- --------- -----------
Carried Forward 3,708 3,146 3,540
---------- --------- -----------
Other Reserves
Brought Forward 15,384 15,384 15,384
Movement - - -
---------- --------- -----------
Carried Forward 15,384 15,384 15,384
---------- --------- -----------
Translation Reserve
Brought Forward (212) (199) (199)
Foreign exchange adjustment (387) (13) (13)
---------- --------- -----------
Carried Forward (599) (212) (212)
---------- --------- -----------
Retained Earnings
Brought Forward (41,943) (39,820) (39,820)
(Loss) / Profit for the Period (854) (85) (2,576)
Value of conversion rights on
convertible loans - - 453
Carried Forward (42,797) (39,905) (41,943)
Convertible Debenture
Brought Forward 4,692 5,145 5,145
Movement - - (453)
Carried Forward 4,692 5,145 4,692
---------- --------- -----------
On 14 June 2022 the company made an announcement to the London Stock Exchange
confirming the issue of 9,087,000 shares equivalent to 4% of its existing
shareholding at a fixed price of 1.79 pence per new ordinary share.
(6) Non Current Assets Right of Property,
use assets Plant &
Land & Buildings Equipment Total
GBP'000 GBP'000 GBP'000
Cost
At 1 January 2022 138 33 171
Foreign exchange adjustment 4 1 5
Additions - 1 1
At 31 Decembr 2022 142 35 177
----------------- ---------- --------
Depreciation / Amortisation
At 1 January 2022 97 6 103
Charge for the period 36 6 42
On disposals - - -
----------------- ---------- --------
At 31 December 2022 133 12 145
----------------- ---------- --------
Net Book Value
At 31 December 2022 9 23 32
----------------- ---------- --------
At 1 January 2022 41 27 68
----------------- ---------- --------
(7) Current Assets 31 Dec 31 Dec 30 June
2022 2021 2021
GBP'000 GBP'000 GBP'000
Restated
Trade receivables - - -
Prepayments and accrued income 14 9 11
Other debtors 62 45 47
Directors loan 38 63 58
Loans to associated undertakings - - 13
114 117 129
-------- -------- ---------
Interest is charged on the Directors loan at a commercial rate.
(8) Current Liabilities 31 Dec 31 Dec 30 June
2022 2021 2021
GBP'000 GBP'000 GBP'000
Restated
Trade payables 368 293 245
Other creditors 489 407 496
Accruals and deferred income 253 280 191
Amounts owed to associated undertakings 2,647 2,335 2,246
Lease creditor 20 37 35
Other loans 265 177 -
Debentures 346 346 291
Shareholders funds in advance - 378
4,388 3,875 3,882
-------- -------- ---------
(9) Non Current Liabilities 31 Dec 31 Dec 30 June
2022 2021 2021
GBP'000 GBP'000 GBP'000
Restated
Lease creditor 12 10 28
Debentures 1,318 1,256 825
Other loans 2,027 1,747 1,727
Provision 813 813 -
4,170 3,826 2,580
-------- -------- ---------
(10) On 27 September 2018 two convertible loan debentures were issued for
GBP4,010,000 and GBP2,062,172 with a coupon rate of 5%.
The loan notes are convertible into Ordinary shares of the parent entity
in three years after the date of issue.
At the Annual General Meeting on 31 December 2020 it was agreed to extend
the conversion period to 26 September 2022.
At the Annual General Meeting on 31 December 2021 it was agreed to extend
the conversion period to 26 September 2025.
The convertible loan debenture will give right to a percentage of the issued
share capital of the parent company at the date of conversion. Each tranche
of GBP1 million debenture owed by the long term holders correspond to 4.925%
of the issued share capital at the date of conversion, resulting in a fixed
percentage of the issued share capital of the company to be allotted to the
loan holders regardless of the value / amount of the share capital of the
company. 31 Dec 31 Dec
2022 2021
GBP'000 GBP'000
Face value of notes issued 6,072 6,072
Value of conversion rights 4,692 4,692
Convertible loan debenture liability 1,380 1,380
-------- --------
Interest expense recognized in period 123 222
-------- --------
The other loans have been advanced to the company from One World Limited.
The funding was provided for a three year period, and interest is charged
on these loans at 6%.
(11) The Group has restated the condensed consolidated income statement,
condensed consolidated statement of financial position, and condensed consolidated
statement of changes in equity for 30 June 2021. This is due errors in the
accounting treatment for convertible loan debentures, foreign exchange translation
and recognition of a Group asset which was not owned by the Group. This has
been considered as a prior year error and has been corrected in accordance
with IAS 8 (Accounting Policies, Changes in Accounting Estimates and Errors).Further
details on the impact of the restatement were included in the financial statements
for the year ended 31 December 2021.
(12) As no revenue has been generated throughout the group in this period
nor the prior period, the Chief Operating Decision Maker believes the information
already disclosed in the interim financial statements is adequate to fulfill
the requirements of IFRS8 segmental reporting. This will be reconsidered
at the year end and in future periods as the group begins to trade.
(13) The Interim Report will be sent by mail to all registered shareholders
and copies will be available from the Company's registered office at 71-75
Shelton Street, London, WC2H 9JQ. A downloadable copy will also be posted
on the Company's website www.ross-group.co.uk
Responsibility statement:
The Directors confirm that, to the best of their knowledge: -
a) the condensed set of financial statements has been prepared in accordance
with International Financial Reporting Standards (IFRS) and IAS 34 'Interim
Financial Reporting';
b) the financial statements give a true and fair view of the assets, liabilities,
financial position and loss of the group:
c) the interim management report includes a fair review of the information
required by DTR 4.2.7R (indication of important events during the first twelve
months and description of principal risks and uncertainties for the remaining
six months of the year); and
d) 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).
On behalf of the Board
B Pettitt
Chief Executive Officer
Ross Group plc
Registered Office
71 - 75 Shelton Street
London WC2H 9JQ
Contact - S Mehta, Non Executive Director
Tel. - 07973 848349
Email - shashiuk@gmail.com
Website - www.ross-group.co.uk
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