TIDMSCHO

RNS Number : 6942G

Scholium Group PLC

27 November 2020

Scholium Group plc

Interim Report & Financial Statements

Six Months ended 30 September 2020

This announcement contains inside information for the purposes of Article 7 of Regulation 596/2014.

The directors of Scholium Group plc ("Scholium", the "Company" or, together with its subsidiaries, the "Group") present their report and financial statements for the Group for the six months ended 30 September 2020.

Operating highlights

   --    Revenues down by 13.7% compared with prior corresponding period 

-- Gross profit lower by 29.1% compared with last year and at a lower margin (31%; 2019: 38%) due to lower margins in Shapero Rare Books and effectively no sales in Scholium Trading

   --    Pre-tax loss of GBP158,000 due to reduced trading levels as a result of Covid-19. 
   --    Shapero Rare Books traded profitably in the period with higher levels of online activity 
   --    Cash balances increased by GBP67k from 31 March to GBP348k at 30 September 2020 

Financial Summary

 
 Six months ended September           2020    2019   Change 
 (GBP000 unless otherwise stated) 
 Revenue                             3,120   3,614   -13.7% 
 
 Gross Profit                          978   1,380   -29.1% 
 
 Gross Margin                          31%     38% 
 
 Pre-Tax (Loss) / Profit             (158)      64 
 
 Inventories                         8,740   8,753    -0.1% 
 
 Net Cash / (Overdraft)                348    (33) 
 
 Net Assets                          9,501   9,962    -4.6% 
 
 NAV/Share (pence)                    69.9    73.3 
 

Jasper Allen, Chairman of Scholium, noted

"We are pleased that Shapero Rare Books has traded profitably, despite the cancellation of books and other trade fairs and the enforced closure of the shop for much of the period. The Group responded by successfully increasing online sales activity and by cutting costs. Overall although the loss is disappointing, the Group has performed at a better level than the Board's expectations earlier this year.

In October the Group relocated its premises to a first floor bookshop at 106 New Bond Street, and a separate new gallery for modern prints nearby at 43 Maddox Street. These moves will contribute to an immediate reduction in the Group's cost base. We remain focussed on maximising sales through online and other channels still available to us, and reducing costs where possible.

We very much look forward to welcoming any shareholders looking to visit our new premises."

For further information, please contact:

 
 Scholium Group plc 
  Jasper Allen, Chairman 
  Peter Floyd, Chief Financial Officer    +44 (0)20 7493 0876 
 WH Ireland Ltd - Nominated Adviser 
  Chris Fielding 
  Lydia Zychowska                         +44 (020) 7220 1666 
 

Business Review

Scholium Group companies are involved primarily in the trading and retailing of antiquarian books and other works on paper, as well as dealing in rare and collectible items in the wider art and philatelic markets.

The group of businesses comprises:

-- Shapero Rare Books, a dealer in rare antiquarian books and, through Shapero Modern, prints and works on paper, located in Mayfair, London;

-- Scholium Trading, a dealer which trades in conjunction with other dealers in higher value rare and collectible items; and

   --                 Mayfair Philatelics, a retail and auction philatelic business 

Revenue streams

The Group earned revenue in the six months to 30 September 2020 from:

   --                 the sale of rare books, prints and works on paper through Shapero Rare Books; 
   --                 the sale of other rare and collectible items through Scholium Trading; and 
   --                 the sale of philatelic items through Mayfair Philatelics 

Key objectives and key performance indicators (KPIs)

The Group's strategy is to:

-- build, either organically or by acquisition, a portfolio of collectibles businesses to enable further diversification and development of its revenue and profit streams;

-- attract individuals or teams of specialists in markets complementary to the Group's existing businesses;

-- optimise working capital in existing businesses to provide funds for new business development; and

-- continue to develop all its trading entities by trading alongside other dealers in high value rare and collectible items and by participating in the acquisition of large consignments for onward sale.

The Directors intend, as soon as practicable, to provide an attractive level of dividends to shareholders along with stable asset-backed growth driven by the markets in which the Group operates.

Our current principal KPIs are:

   --                 Sales, gross margin, profit before tax, earnings per share; 

-- the breadth and distribution of the stock of rare books and prints held by the Group;

   --                 stock turnover; and 
   --                free cash flow. 

Performance Review

Overall Performance

The Group made a loss before tax of GBP158k during the six months to 30 September 2020, a disappointing but not unexpected change from the profit of GBP64k for the corresponding period last year. Trading was adversely affected by the onset of the restrictions imposed for Covid-19 from March 2020, including the closure of the Group's retail premises, and each of the Group's trading entities performed worse than the corresponding period last year.

Turnover decreased by 13.7% compared to the same period in the prior year. This was due to lower sales in Shapero Rare Books (SRB), Scholium Trading and Mayfair Philatelics. SRB's sales were GBP168k lower than last year, Scholium Trading's sales were GBP213k lower than last year and Mayfair Philatelics decreased by GBP113k. Gross Profit decreased by 29.1% to GBP978k (2019: GBP1,380k; 2018: GBP1,176k) reflecting the lower margins available in order to achieve sales during this difficult trading period. However, it is encouraging that the move to a far greater dependence on online sales was successfully achieved.

Group costs, including Distribution and Administrative expenses, decreased by 13.6% to GBP1,132k (2019: GBP1,310k; 2018: GBP1,229k). Most of this decrease was due to the cancellation of the trade fairs previously attended by SRB. The Group's costs are expected to increase in the second half, as there will be the costs arising from the relocation of premises, and the costs of any fairs or exhibitions. There will be two public auctions in Mayfair Philatelic compared to one in the first half of the year, and both are expected to contribute to revenue and gross margin.

The Group result for the six months was a loss before tax of GBP158k (2019: profit of GBP64k; 2018: loss of GBP56k). There is no current or deferred tax credit (2019: charge GBP13k; 2018: GBP0k) as the Group has brought forward tax losses.

Inventories decreased by GBP13k to GBP8,740k (2019: GBP8,753k; 2018: GBP8,905k). This is due to purchases matching sales during the period. Pleasingly, the Group retained the positive cash balance it had at 31 March 2020 with cash of GBP348k at 30 September 2020 (2019: overdraft of GBP33k; 2018 overdraft GBP245k). Free cashflow during the six month period was therefore GBP67k (2019: GBP(225k); 2018: GBP(461k)).

Summary Group Financials

 
 Six months ended September (all figures GBP'000)       2020           2019   Change 
 Revenue                                               3,120          3,614   -13.7% 
 Gross Profit                                            978          1,380   -29.1% 
 Gross Margin                                            31%            38% 
 Distribution Expenses                                 (118)          (260)   -54.4% 
 Administrative Expenses                             (1,014)        (1,050)    -3.4% 
 Pre-Tax (Loss) / Profit                               (158)             64 
 
 Inventories                                           8,740          8,753    -0.1% 
 Cash                                                    348           (33) 
 Net Assets                                            9,501          9,962    -4.6% 
 NAV/Share (pence)                                      69.9           73.3 
 

Financial Position

The Group retains a strong balance sheet. Net assets of GBP9,501k (2019: GBP9,962k; 2018: GBP9,868k) are supported by GBP8,740k of stock (2019: GBP8,753k; 2018: GBP8,905k) and GBP348k of cash (2019: overdraft of GBP33k; 2018: overdraft of GBP245k). Trade and other receivables and trade and other payables have both decreased as trading activity has reduced during the period. The Group has recognised a right of use asset of GBP1,208k and corresponding liability of GBP1,182k in respect of the leases for its new premises in New Bond Street and Maddox Street, Mayfair. There is 69.9p of net assets per share (2019: 73.3p; 2018: 72.6p).

Group Strategy

The Group has continued with the diversification of its revenue streams through Mayfair Philatelics, which is now operating a fuller programme of auction sales. Mayfair Philatelics and Scholium Trading are now divisions of Shapero Rare Books Limited.

Shapero Rare Books is continuing to develop its Shapero Modern prints and works on paper business, and has commenced a re-balancing of its stock between rare books and prints to enable it to increase its sales of prints in the future.

The Group has relocated its premises in October 2020. Shapero Rare Books now has a first floor bookshop at 106 New Bond Street, and a separate new gallery for modern prints nearby at 43 Maddox Street. These moves will contribute to an immediate reduction in the Group's cost base.

The Group is also focussed on reducing its inventories as part of a process towards increasing its business towards consignments from third parties for either retail or auction sales.

Shapero Rare Books & Shapero Modern

The bulk of the trade, through Shapero Rare Books, is in rare and antiquarian books and works on paper. Shapero Modern is a newer business which was set up in 2014 to participate in the increasingly large international trade in modern and contemporary prints.

Trading in both Rare Books and Shapero Modern was at slightly reduced levels during the first six months of the year compared to the prior year. Turnover decreased by 6% as compared to the prior-year period to GBP2,730k (2019: GBP2,898k; 2018: GBP2,754k) due to the adverse impact of Covid-19. The gross margin of 30% (2019: 39%; 2018: 36%) reflected lower margins across both books and prints. The profit achieved by this division for the first six months of the financial year was GBP19k (2019: GBP126k; 2018: 87k).

Summary Performance, Shapero

 
 Six months ended September (all figures GBP'000)      2020     2019   Change 
 Revenue                                              2,730    2,898    -5.8% 
 Gross Profit                                           817    1,117   -26.9% 
 Gross Margin                                           30%      39% 
 Pre-Tax Profit                                          19      126   -84.9% 
 

Scholium Trading

Scholium Trading was set up to trade alongside third party dealers in rare and collectible items. It typically trades in paintings and works of art.

Scholium Trading's activity tends to be more uneven than the other businesses in the Group, which has been evident in the six months to 30 September 2020. The first half resulted in sales of GBP7k (2019: GBP220k; 2018: GBP127k), with a gross profit of GBP1k (2019: GBP54k; 2018: GBP48k). The absence of sales resulted from the cancellation of all of the fairs at which Scholium Trading would normally attend, together with retail space also being closed for a significant part of the period and a quieter period in the Old Masters market.

Summary Performance, Scholium Trading

 
 Six months ended September (all figures GBP'000)    2020   2019         Change 
 Revenue                                                7    220         -96.8% 
 Gross Profit                                           1     54         -98.1% 
 Gross Margin                                         14%    25% 
 Pre-Tax (Loss) / Profit                              (9)     36 
 

Mayfair Philatelics

Mayfair Philatelics is now operating a fuller auction programme. During the first half of the current year, it held three (one public and two postal) auctions, compared with two public and one postal auction in the prior six months to 30 September 2019. Two public and one postal auctions are planned for the second half of the year. Public auctions generally achieve higher sales than postal auctions.

The first half resulted in sales of GBP383k (2019: GBP496k; 2018: GBP404k) from both retail and auction activities. Gross profit, which was principally from the auction activities, amounted to GBP161k (2019: GBP208k; 2018: GBP116k). Direct costs and overheads amounted to GBP182k (2019: GBP215k; 2018: GBP174k) as postal auctions incur lower costs than public auctions.

Summary Performance, Mayfair Philatelics

 
 Six months ended September (all figures GBP'000)    2020   2019         Change 
 Revenue                                              383    496         -22.8% 
 Gross Profit                                         161    208         -22.5% 
 Gross Margin                                         42%    42% 
 Pre-Tax (Loss)                                      (21)   (35)          40.0% 
 

Central costs

The central costs of the business include all board directors and other group level costs including the various costs associated with the AIM listing. There were no (2019: GBP78k; 2018: GBP72k) recharges made to the Group's subsidiaries for these central costs in the six months ended 30 September 2020. The central costs were therefore GBP147k (2019: GBP141k; 2018: GBP132k) on a comparable basis with prior periods.

Summary Performance, Central costs

 
 Six months ended September (all figures GBP'000)     2020    2019   Change 
 Pre-Tax (Loss)                                      (147)   (141)     4.1% 
 

Outlook

The impact of the restrictions imposed by governments worldwide in response to Covid-19 continue to have an adverse effect on the Group's trading and ability to make profits. The Group is continuing to focus its efforts on its various online platforms, as well as maintaining contact with customers remotely via email and telephone. This has provided better results than originally envisaged in the first half of the year.

Looking forward, with the Group's retail premises currently closed to customers due to the UK government's response to Covid-19, and the cancellation of all of this financial year's UK and international trade fairs, the Group is currently expected to be loss making in the second half of this financial year.

Key Risks

Like all businesses, the Group faces risks and uncertainties that could impact on the Group's strategy. The Board recognizes that the nature and scope of these risks can change and regularly reviews the risks faced by the Group and the systems and processes to mitigate such risks.

The principal risks and uncertainties affecting the continuing business activities of the Group were outlined in detail in the Strategic Report section of the annual report covering the full year ended 31 March 2020.

In preparing this interim report for the six months ended 30 September 2020, the Board has reviewed these risks and uncertainties and considers that there have been no changes since the publication of the 2020 Annual Report. The effect of the restrictions placed upon the Group and its customers by governments continues to impact the Group adversely.

Independent Review Report to Scholium Group plc

Introduction

We have been engaged by the Company to review the condensed set of financial statements in the interim report for the six months ended 30th September 2020 which comprises the condensed consolidated statement of comprehensive income, the consolidated statement of changes in equity, the condensed consolidated statement of financial position and the consolidated statement of cash flows and the related explanatory notes. We have read the other information contained in the interim report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.

Directors' Responsibilities

The interim financial report is the responsibility of, and has been approved by, the Directors. The Directors are responsible for preparing the half-yearly financial report in accordance with the Disclosure Guidance and Transparency Rules of the United Kingdom's Financial Conduct Authority.

As disclosed in note 2, the annual financial statements of the Group are prepared in accordance with IFRSs as adopted by the EU. The condensed set of financial statements included in this interim report has been prepared in accordance with the recognition and measurement requirements of IFRSs as adopted by the EU.

Our Responsibility

Our responsibility is to express to the Company a conclusion on the condensed set of financial statements in the half-yearly financial report based on our review.

Scope of Review

We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410 "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Financial Reporting Council for use in the United Kingdom. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the interim financial report for the six months ended 30th September 2020 is not prepared, in all material respects, in accordance with International Accounting Standard 34 as adopted by the European Union and the Disclosure Guidance and Transparency Rules of the United Kingdom's Financial Conduct Authority.

Use of Our Report

This report is made solely to the Company in accordance with International Standard on Review Engagements (UK and Ireland) 2410 "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Financial Reporting Council. Our work has been undertaken so that we might state to the Company those matters we are required to state to it in an independent review report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company, for our review work, for this report, or for the conclusions we have formed.

L Baker FCA

For and on behalf of

Wenn Townsend Chartered Accountants

Oxford, United Kingdom

26 November 2020

Consolidated statement of total comprehensive income (unaudited)

 
                                                       Six-month              Six-month 
                                                          Period                 Period   Year Ended 
                                               Ended (Unaudited)      Ended (Unaudited)    (Audited) 
                                                         30 Sept                30 Sept       31 Mar 
                                                            2020                   2019         2020 
                                       Note               GBP000                 GBP000       GBP000 
 
 Revenue                                4                  3,120                  3,614        7,300 
 Cost of Sales                                           (2,142)                (2,234)      (4,380) 
 Gross profit                                                978                  1,380        2,920 
                                             -------------------  ---------------------  ----------- 
 
 Distribution costs                                        (118)                  (260)        (720) 
                                             -------------------  ---------------------  ----------- 
 
 
 Administrative expenses                                 (1,014)                (1,050)      (2,162) 
 
 
 Total administrative expenses                           (1,014)                (1,050)      (2,162) 
                                             -------------------  ---------------------  ----------- 
 
 
 (Loss) /Profit from operations                            (154)                     70           37 
 
 Financial income                                              -                      -            - 
 Financial expenses                     5                    (4)                    (6)         (13) 
 
 (Loss) / Profit before taxation                           (158)                     64           25 
 
 Income tax (expense)                   6                      -                  (13)         (277) 
 
 (Loss) / Profit for the period 
  from continuing operations                               (158)                     51        (252) 
 
 (Loss) / Profit for the period 
  and total comprehensive income 
  attributable to equity holders 
  of the parent company                                    (158)                     51        (252) 
                                             -------------------  ---------------------  ----------- 
 
 Basic and diluted (loss) 
  / profit per share: 
 From continued operations 
  - pence                               7                 (1.16)                   0.38       (1.86) 
 
 Total diluted (loss) / profit 
  per share - pence                                       (1.16)                   0.38       (1.86) 
                                             -------------------  ---------------------  ----------- 
 

Consolidated statement of financial position

 
                                                            30 Sept     30 Sept    31 Mar 
                                                               2020        2019      2020 
                                                 Note        GBP000      GBP000    GBP000 
                                                          Unaudited   Unaudited   Audited 
 Assets 
 Non-current assets 
 Property, plant and equipment                                1,306         389       233 
 Intangible assets                                               10          14        12 
 Deferred corporation tax asset                                   -         264         - 
                                                              1,316         667       245 
                                                         ----------  ----------  -------- 
 
 Current assets 
 Inventories                                                  8,740       8,753     8,981 
 Trade and other receivables                      8           1,562       2,811     1,492 
 Cash and cash equivalents                                      348           7       281 
                                                             10,650      11,571    10,754 
                                                         ----------  ----------  -------- 
 
 
 Total assets                                                11,966      12,238    10,999 
                                                         ----------  ----------  -------- 
 
 Current liabilities 
 Trade and other payables                         9           1,259       1,916     1,168 
 Bank overdraft                                                   -          40         - 
 Right-of-use asset lease liabilities             10            161         320       172 
 Total current liabilities                                    1,420       2,276     1,340 
                                                         ----------  ----------  -------- 
 
 
   Right -of-use asset lease liabilities 
   due 
   over one year                                              1,045           -         - 
                                                         ----------  ----------  -------- 
 
 Total liabilities                                            2,465       2,276     1,340 
                                                         ----------  ----------  -------- 
 
 Net assets                                                   9,501       9,962     9,659 
                                                         ----------  ----------  -------- 
 
 Equity and liabilities 
 Equity attributable to owners 
  of the parent 
 Ordinary shares                                                136         136       136 
 Share premium                                                9,516       9,516     9,516 
 Merger reserve                                                  82          82        82 
 Retained earnings                                            (233)         228      (75) 
 Total equity                                                 9,501       9,962     9,659 
                                                         ----------  ----------  -------- 
 
 Net Asset Value per Share                                    69.9p       73.3p     71.0p 
 
 

These interim financial statements were approved by the Board of Directors on 26 November 2020 and signed on its behalf by Peter Floyd.

Statement of changes in equity

 
                                                        Share     Share    Merger   Retained    Total 
                                                      Capital   Premium   reserve   earnings   equity 
                                                       GBP000    GBP000    GBP000     GBP000   GBP000 
                                                     --------  --------  --------  ---------  ------- 
 
 
 Balance at 1 April 2017                                  136     9,516        82        189    9,923 
 
 Profit for the period from continued 
  operations                                                -         -         -         36       36 
 Total comprehensive income for the period                  -         -         -         36       36 
                                                     --------  --------  --------  ---------  ------- 
 Balance at 30 September 2017                             136     9,516        82        225    9,959 
 
 Profit for the period from continued 
  and discontinued operations                               -         -         -          2        2 
 Total comprehensive income for the period                  -         -         -          2        2 
                                                     --------  --------  --------  ---------  ------- 
 
 Balance at 31 March 2018                                 136     9,516        82        227    9,961 
 
 Adjustment on recognition of IFRS 15                       -         -         -       (37)     (37) 
                                                            -         -         -       (37)     (37) 
                                                     --------  --------  --------  ---------  ------- 
 
 Balance at 31 March 2018 as restated                     136     9,516        82        190    9,924 
 
 Loss for the period from continued operations              -         -         -       (56)     (56) 
                                                     --------  --------  --------  ---------  ------- 
 Total comprehensive income for the period                  -         -         -       (56)     (56) 
                                                     --------  --------  --------  ---------  ------- 
 
 Balance at 30 September 2018                             136     9,516        82        134    9,868 
 
 Profit for the period from continued operations            -         -         -         43       43 
                                                     --------  --------  --------  ---------  ------- 
 Total comprehensive income for the period                                                43       43 
 
 Balance at 31 March 2019                                 136     9,516        82        177    9,911 
 
   Loss for the period from continued operations            -         -         -         51       51 
                                                     --------  --------  --------  ---------  ------- 
 Total comprehensive income for the period                  -         -         -         51       51 
                                                     --------  --------  --------  ---------  ------- 
 
 Balance at 30 September 2019                             136     9,516        82        228    9,962 
 
   Loss for the period from continued operations            -         -         -      (303)    (303) 
                                                     --------  --------  --------  ---------  ------- 
 Total comprehensive income for the period                  -         -         -      (303)    (303) 
                                                     --------  --------  --------  ---------  ------- 
 
   Balance at 31 March 2020                               136     9,516        82       (75)    9,659 
 
   Loss for the period from continued operations            -         -         -      (158)    (158) 
                                                     --------  --------  --------  ---------  ------- 
 Total comprehensive income for the period                  -         -         -      (158)    (158) 
                                                     --------  --------  --------  ---------  ------- 
 
 Balance at 30 September 2020                             136     9,516        82      (233)    9,501 
 
 

Consolidated statements of cashflows

 
                                                           30 Sept   30 Sept   31 Mar 
                                                              2020      2019     2020 
                                                            GBP000    GBP000   GBP000 
 
 Cash flows from operating activities 
 Operating (loss) / profit before 
  tax                                                        (158)        64       25 
 Depreciation of property, plant 
  and equipment                                                163       162      326 
  including right-to-use assets 
   (see note 3) 
 Amortisation of intangible assets                               2         2        4 
                                                                 7       228      355 
 
 Decrease / (increase) in inventories                          241      (96)    (325) 
 (Increase)/ decrease in trade 
  and other receivables                                       (96)     (292)    1,037 
 Increase/(decrease) in trade 
  and other payables                                            96       112    (633) 
 
 Net cash generated from operating 
  activities                                                   248      (48)      433 
                                                      ------------  --------  ------- 
 
 Cash flows from investing activities 
 Purchase of property, plant 
  and equipment                                               (29)      (23)     (36) 
 Purchase of intangible asset                                    -         -        - 
                                                      ------------  --------  ------- 
 Net cash used in investing activities                        (29)      (23)     (36) 
                                                      ------------  --------  ------- 
 
 Cash flows from financing activities 
 Lease repayments for right-of-use 
  assets (see note 3)                                        (148)     (148)    (296) 
 Interest paid                                                 (4)       (6)     (13) 
 Net cash (used)/generated from financing 
  activities                                                 (152)     (154)    (309) 
                                                      ------------  --------  ------- 
 
 Net increase / (decrease) in cash 
  and cash equivalents                                          67     (225)       89 
 
 Cash and cash equivalents at the beginning 
  of the period                                                281       192      192 
 
 Cash and cash equivalents at 
  the end of the period                                        348      (33)      281 
                                                      ------------  --------  ------- 
 
 
 
 Cash                                348      7   281 
 
 Bank overdraft                        -   (40)     - 
 
 Cash and cash equivalents at 
  the end of the period              348   (33)   281 
                                    ----  -----  ---- 
 
 

Notes

   1.   General information 

Scholium Group plc and its subsidiaries (together 'the Group') are engaged in the trading and retailing of rare and antiquarian books, prints and works on paper and philatelic items primarily in the United Kingdom. The Company is a public company domiciled and incorporated in England and Wales (registered number 08833975). The

address of its registered office is 106 New Bond   Street, London W1S 1DN. 
   2.   Basis of preparation 

These condensed interim financial statements of the Group for the six months ended 30 September 2020 (the 'Period') have been prepared using accounting policies consistent with International Financial Reporting Standards (IFRSs) as adopted by the European Union. The same accounting policies, presentation and methods of computation are followed in the condensed set of financial statements as applied in the Group's latest audited financial statements for the year ended 31 March 2020. While the financial figures included within this half-yearly report have been computed in accordance with IFRSs applicable to interim periods, this half-yearly report does not contain sufficient information to constitute an interim financial report as set out in International Accounting Standard 34 Interim Financial Reporting. These condensed interim financial statements have not been audited, do not include all of the information required for full annual financial statements, and should be read in conjunction with the Group's consolidated annual financial statements for the year ended 31 March 2020. The auditors' opinion on these Statutory Accounts was unqualified, did not draw attention to any matters by way of emphasis and did not contain a statement under s498 (2) or s498 (3) of the Companies Act 2006.

   3.   IFRS 16 Leases 

The Group implemented IFRS 16 with effect 1 April 2019 using the modified retrospective method. The Group has assessed the impact of adopting IFRS 16 on the Group and concluded that any impact of discounting would be insignificant in this period. As the only material right-of-use lease expired in October 2020, the rentals payable are considered to be equal to the right-of-use depreciation charge and are therefore released on a straight line basis with no interest charge. This is a departure from IFRS 16 but this departure has been assessed as being immaterial.

The impact of the implementation of IFRS 16 is to recognise a right-of-use asset and equal lease liability of GBP468,271 as at 1 April 2019. There is a depreciation charge of GBP147,875 in each of the six months ended 30 September 2019 and 30 September 2020 and GBP295,750 for the year ended 31 March 2020 which would previously have been included as a rent expense. This impacts the presentation of these two items in the consolidated statement of cash flows. At 30 September 2020 t he Group has recognised a right of use asset of GBP1,208k and corresponding liability of GBP1,182k in respect of the leases for its new premises in New Bond Street and Maddox Street, Mayfair.

Under IFRS 16

The Group recognises a right-of-use asset and a lease liability at the lease commencement date (or at 1 April 2019 for remaining amounts payable in respect of leases entered in to before the implementation date). The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to dismantle and remove the underlying asset or the site on which it is located, less any lease incentives received.

The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term. The estimated useful lives of right-of-use assets are determined on the same basis as those of property and equipment. In addition, the right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurement of the lease liability.

The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Group's incremental borrowing rate. In the current year's accounts, no allowance has been made for interest as its impact is considered immaterial.

Lease payments included in the measurement of the lease liability comprise fixed payments, including in-substance fixed payments.

The Group presents right-of-use assets that do not meet the definition of investment property as a separate class of assets within "property, plant and equipment" and lease liabilities in "loans and borrowings" in the statement of financial position.

   4.   Revenue 
 
                        30 Sept   30 Sept   31 Mar 
                           2020      2019     2020 
                          Group     Group    Group 
                         GBP000    GBP000   GBP000 
 
  Sales of Stock          3,025     3,457    7,214 
  Commissions                93       138       60 
  Other income                2        19       26 
                          3,120     3,614    7,300 
                       --------  --------  ------- 
 
   5.   Financial (expenses) 
 
                          30 Sept   30 Sept   31 Mar 
                             2020      2019     2020 
                            Group     Group    Group 
                           GBP000    GBP000   GBP000 
 
  Interest payable            (4)       (6)     (13) 
                         --------  --------  ------- 
 
   6.   Income Tax 
 
                                                            30 Sept   30 Sept   31 Mar 
                                                               2020      2019     2020 
                                                             GBP000    GBP000   GBP000 
  Current and deferred tax expense 
  Current tax                                                     -         -        - 
  Deferred tax                                                    -        13    (277) 
 
  Total tax expense                                               -        13    (277) 
                                                           --------  --------  ------- 
  The charge for the year can be reconciled 
  to the (loss) / profit per the income statement as 
  follows: 
                                                            30 Sept   30 Sept   31 Mar 
                                                               2020      2019     2020 
                                                             GBP000    GBP000   GBP000 
 
  (Loss) / Profit before tax                                  (158)        64       25 
                                                           --------  --------  ------- 
 
  Applied corporation tax rates:                                19%       19%      19% 
 
  Tax at the UK corporation tax rate of 19%:                   (30)        13        5 
 
 
  Unrecognised deferred tax asset                                30         -        - 
  Write off of previously recognised tax losses                   -         -    (277) 
  Origination and reversal of temporary differences               -         -      (5) 
  Current and deferred tax charge                                 -        13    (277) 
                                                           --------  --------  ------- 
 
   7.   Earnings/(Loss) per Share 
 
                                                                               30 Sept    30 Sept     31 Mar 
                                                                                  2020       2019       2020 
                                                                                 Group      Group      Group 
                                                                                GBP000     GBP000     GBP000 
 
  (Loss) / Profit used in calculating basic and diluted earnings per 
  share attributable to the 
  owners of the parent                                                           (158)         51      (252) 
 
  Number of shares 
  Weighted average number of shares for the purpose 
                                                                                  13.6       13.6       13.6 
  of basic and diluted earnings per share                                      million    million    million 
                                                                             ---------  ---------  --------- 
 
 
 
  Total basic and diluted earnings per share - pence                            (1.16)       0.38     (1.86) 
                                                                             ---------  ---------  --------- 
 

Basic earnings per share amounts are calculated by dividing net (loss) / profit for the year or period attributable to ordinary equity holders of the parent by the weighted average number of ordinary shares outstanding during the year.

The Company has no potentially issuable shares arising from share options. As a consequence, the number of basic and fully diluted shares in issue are equal.

No new shares were issued during the period, and the Company had 13.6 million shares in issue at the end of the period.

   8.   Trade and Other Receivables 
 
                                 30 Sept   30 Sept   31 Mar 
                                    2020      2019     2020 
                                   Group     Group    Group 
                                  GBP000    GBP000   GBP000 
 
  Trade debtors                    1,372     2,546    1,347 
  Other debtors                       46        14       47 
  Prepayments and accrued 
   income                            144       251       98 
                                   1,562     2,811    1,492 
                                --------  --------  ------- 
 
   9.   Trade and Other Payables 
 
                                      30 Sept   30 Sept   31 Mar 
                                         2020      2019     2020 
                                        Group     Group    Group 
                                       GBP000    GBP000   GBP000 
 
  Trade creditors                         720     1,409      705 
  Other taxes and social 
   security                                29        27       31 
  Accruals and deferred income            482       446      388 
  Other creditors                          28        34       44 
                                        1,259     1,916    1,168 
                                     --------  --------  ------- 
 

10. Right-of-use asset lease liabilities

 
                                  30 Sept   30 Sept   31 Mar 
                                     2020      2019     2020 
                                    Group     Group    Group 
                                   GBP000    GBP000   GBP000 
 
 
  Lease liabilities due in 
   less than one year                 161       320      172 
                                 --------  --------  ------- 
  Lease liabilities due in 
   more than one year               1,045         -        - 
                                 --------  --------  ------- 
 

These liabilities represent the future lease payments due under the Group's lease of its Mayfair premises. (See note 3).

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our Privacy Policy.

END

IR DZMZMLVZGGZM

(END) Dow Jones Newswires

November 27, 2020 02:00 ET (07:00 GMT)

Scholium (LSE:SCHO)
Historical Stock Chart
From Feb 2024 to Mar 2024 Click Here for more Scholium Charts.
Scholium (LSE:SCHO)
Historical Stock Chart
From Mar 2023 to Mar 2024 Click Here for more Scholium Charts.