TIDMFFWD
RNS Number : 4028S
FastForward Innovations Limited
20 December 2016
20 December 2016
FastForward Innovations Limited
("FastForward" or the "Company")
Unaudited Half-yearly results
For the Six months ended 30 September 2016
Highlights
-- Net assets per share at 30 September 2016 of 7.92p (31 March 2016: 7.85p).
-- The Company has completed two investments during the period.
Further details of these investments are set out at the Company's
website and in the Co-Chairman's Statement in this report.
-- Norbert Teufelberger became a consultant to the Company.
-- Josh Epstein was appointed as a partner and Company Secretary.
Co-Chairman's Statement
We are pleased to present the unaudited condensed half-yearly
report and financial statements of FastForward Innovations Limited
(the "Company" or "FastForward") for the six-month period ended 30
September 2016.
Lorne Abony has travelled extensively over the last six months
both evaluating potential new investment projects and providing
value adding support to the management of companies within our
existing portfolio. Lorne has also started to build a team around
him which both enhances our deal flow, improves our due diligence
process and ensures that we can complete transactions
expeditiously. Norbert Teufelberger who became a consultant to the
Company during the period, brings his considerable knowledge and
experience particularly in the gaming sector while Josh Epstein who
was appointed as a partner and Company Secretary significantly
strengthens our ability to analyse and implement our investment
goals.
Results
The net assets of the Company at 30 September 2016 were
GBP10,614,000 (30 September 2015: GBP1,079,000, 31 March 2016:
GBP10,270,000), equal to net assets of 7.92p per Ordinary Share (30
September 2015: 2.57p per Ordinary Share, 31 March 2016: 7.85p per
Ordinary Share).
Changes during the period
In June we took the decision to appoint Peel Hunt LLP as our
Nominated Adviser. The team at Peel Hunt has engaged
enthusiastically with our business philosophy and we appreciate the
care and advice they bring to our new relationship. Also Vistra
Fund Services (Guernsey) has taken over accounting and registered
office services to the Company, while Josh Epstein became Company
Secretary. As a result of the changes the registered office of the
Company is now 11 New Street, St Peter Port, Guernsey, GY1 2PF.
Post period end
On 17 November 2016 Bryan Smith (Non-Executive Director)
resigned as a Director of the Company. We would both like to record
our thanks to Bryan for being a wise and independent voice on many
of the investment decisions taken over the last 18 months and we
wish him well in whatever new projects he undertakes.
Investments
Since the approval of the 31 March 2016 audited financial
statements the Company has completed two new investments. Further
details of these investments are set out in the Chief Executive's
report at the Company's website www.fstfwd.co.
Outlook
We remain confident that the Investing Policy is enabling the
Company to take advantage of exciting investment opportunities in
the technology and life science sectors. We believe that, through
our broad range of contacts and expertise, we can continue to
identify various opportunities and determine quickly which
opportunities could be viable and progress quickly to formal due
diligence. So far, we have acted methodically but speedily to
acquire the current investments which we believe have and are
demonstrating their potential. We will continue to identify viable
opportunities through our comprehensive and thorough review
process, and we are optimistic of developing a strong portfolio of
investments with significant value.
Stephen Dattels Jim Mellon
20 December 2016
Enquires
FastForward Innovations Limited +44 (0) 1481 726034
Lorne Abony / Ian Burns / Josh Epstein
Peel Hunt LLP Tel: +44 (0)20 7418 8900
Dan Webster / Adrian Trimmings / George Sellar
A copy of the half-yearly financial statements will shortly be
available for inspection on the Company's website:www.fstfwd.co.
Copies can be obtained in hard copy form free of charge, from the
Company Secretary, 11New Street, St Peter Port, Guernsey, GY1
2PF
REPORT OF THE CHIEF EXECUTIVE OFFICER
Introduction
When I last reported to shareholders I stated: "I believe that
attractive investment returns can be generated from investing in
emerging technologies that will shape the future." While our prior
period saw us make a much larger volume of transactions, in this
most recent period, we made our single largest investment, and saw
much of our portfolio grow. I'm pleased to be updating you all on
our progress, and shining some light into our strategy and
execution. Our near-term growth gives me tremendous confidence that
we are creating a portfolio, with the potential to generate
significant, long-term shareholder returns.
Strategy
Our strategy is to invest in visionary entrepreneurs developing
innovative technologies that have the potential of being massively
innovative. Today's industries are changing constantly;
technological innovation is creating growth like we've never before
seen in history. While our focus early-on has been to concentrate
on early-stage technology companies, we continue to research and
assess other industries, where the potential for hyper-growth
exists and where our capital and expertise can be leveraged, to
provide us with an above-average opportunity for successful
returns.
In the period we have invested in two companies (Leap Gaming and
Moon Active) both of whom have developed and use next-generation
technologies to create exciting products for the gaming space. To
date, Leap has done a fantastic job of growing the footprint of
their technology platform, namely through their Virtual Sports
product(s), which we believe will yield quite significant results
on an on-going basis. Moon Active, have delivered outstanding
results and growth, and are leveraging their learning's to grow
even more rapidly and efficiently.
We have devoted a substantial amount of time this year to
supporting our current investee's businesses. We work closely with
the CEO's to support them in their growth. As investors, its not
only our duty to invest in companies, its our duty to ensure that
our investments fetch the type of returns we owe to shareholders.
Furthermore, as I stated previously, we've spent a great deal of
time working to help crystallize the value of our existing
investments, at valuations well in excess of our original
investments. I believe the results of this work will be forthcoming
and I look forward to updating you all when possible.
Performance and valuation
The Company's Net Asset Value ("NAV") per share stands at 7.92p
per share compared to 7.57p at 31 March 2016. Our share price moved
from 15.38p per share at 31 March 2016 to 11.98p per share at 30
September 2016, and we have consistently traded at a premium to
NAV. In my view, this reflects that our shareholders understand the
potential locked up in the Company.
The portfolio of investments is entirely comprised of unquoted
start-up companies, all of which have been acquired during the
year. Initially we have deemed the fair value of the investments to
be the cost of acquisition unless there is an event or factor, as
defined under accounting standards, which causes the Directors to
consider that another measure of fair value should be used.
Portfolio
The table below lists the Company's holdings as at 30 September
2016. It details the stake that those positions represent in the
investee companies.
Holding Share Class Category Country of Number of Valuation Percentage
incorporation shares held at 30-Sept-16 of investee
at 30-Sept-16 equity held
('000)
----------------- ---------------- -------------- ---------------- --------------- --------------- -------------
Fralis LLC
( Leap Gaming) Units Gaming Nevis 970 2,700 41.15%
----------------- ---------------- -------------- ---------------- --------------- --------------- -------------
Intensity
Therapeutics, Series A Biotech/
Inc Preferred Healthcare USA 250,000 386 2.11%
----------------- ---------------- -------------- ---------------- --------------- --------------- -------------
Moon Active
Ltd. Ordinary Gaming Israel 21,949 386 5.9%
----------------- ---------------- -------------- ---------------- --------------- --------------- -------------
The Diabetic
Boot Company Biotech/
Limited Ordinary Healthcare England 25,978 347 4.86%
----------------- ---------------- -------------- ---------------- --------------- --------------- -------------
SatoshiPay Blockchain
Limited Ordinary Tech England 1,471 138 10.00%
----------------- ---------------- -------------- ---------------- --------------- --------------- -------------
Blockchain
Factom, Inc Series Seed Tech USA 400,000 551 3.70%
----------------- ---------------- -------------- ---------------- --------------- --------------- -------------
Pref Series
Vemo Education, Seed-1 Pref
Inc Series Seed-2 Edtech USA 527,059 810 5.38%
1,000,000
------------------------------------------------------------------ --------------- --------------- -------------
Series Seed Media
Yooya Media Preferred and Content BVI 27,255 1,466 15.00%
----------------- ---------------- -------------- ---------------- --------------- --------------- -------------
Vested Finance, Series Seed-1
Inc Preferred Edtech USA 1,078,035 1,311 12.34%
----------------- ---------------- -------------- ---------------- --------------- --------------- -------------
Total investments
value 8,095
--------------------------------------------------------------------- --------------- --------------- -------------
Cash, prepayments
and net accruals 2,519
--------------------------------------------------------------------- --------------- --------------- -------------
Net asset GBP10,614
value
--------------------------------------------------------------------- --------------- --------------- -------------
Investee companies
Fralis LLC (trading as Leap Gaming)
Leap Gaming, which was acquired during the period, is a
developer and provider of 3D gaming technology and products with a
focus on virtual sports and casino. Leap Gaming partners with
top-tier online and land-based gaming companies to provide advanced
gaming products for end-users. Leap Gaming's next generation
technology has the potential to completely re-define the gaming and
sports markets as we know them. Just before the period end Leap
Gaming announced the finalisation of partnership agreements with
three strategic partners which validate their product and business
model to the wider industry and to consumers. With a steady
pipeline of future partnerships and new customers, I believe Leap
Gaming will continue growing aggressively.
Intensity Therapeutics
Intensity Therapeutics is a product development biotechnology
company whose mission is to greatly extend the lives of patients
with cancer. Intensity Therapeutics is using its proprietary
DfuseRxSM platform technology to create novel immune-based
therapeutic products for a new and emerging field of cancer
treatment known as in situ vaccination. Intensity Therapeutics has
made progress towards initiating clinical studies having
manufactured the clinical supplies and made regulatory filings with
the US FDA and Health Canada. It has also contracted with two
academic hospitals (one in the US and one in Canada) to enrol
patients into their study.
Moon Active
Moon Active, which we invested into during the period, aims to
become a leader in the market of casual social games. Utilizing
next-generation technology and hybrid game mechanics, they are able
to create uniquely personalized experiences for their users. Moon
Active develops games for iOS and Android devices as well as for
the Facebook platform. Moon Active was founded in 2011 and is
headquartered in Tel Aviv. Moon Active's flagship game, Coin
Master, nearly doubled revenue since the previous quarter and is
expected to continue its growth.
The Diabetic Boot Company ("DBC")
DBC, which trades under the name "Pulseflow", has developed a
new form of diabetic friendly footwear with integrated offloading
capabilities and the patented Pulseflow technology which aids in
the promotion of blood flow and improved circulation in one
product. In April 2016 DBC raised additional capital from, among
others Regent Pacific Group Limited. This additional capital was
dependent on DBC achieving certain milestones which it has not. On
6 October 2016, Life Science Development Limited ("Life"), a
company listed on the AIM market and in which Jim Mellon is a
director and has a 44% shareholding, announced that it had entered
into a non-binding term sheet to acquire 100% of DBC for new shares
in Life. DBC has successfully obtained short term debt finance and
a convertible security in which Fast Forward did not
participate
It is disappointing that DBC has missed key milestones and to
see the value of the company not increase as expected. The major
challenge to the DBC board is to successfully navigate its current
funding issues, which are reflected in the value attributed to the
investment in these financial statements, but if they can I believe
that Pulseflow will be a successful product, providing an effective
treatment to thousands of diabetes sufferers who might otherwise
face amputation or more dire consequences.
SatoshiPay Limited
SatoshiPay has created a novel way to utilize blockchain
technology to aid companies seeking to transact digitally. The
growing adoption of ad-blocking on both the consumer and ISP level,
coupled with the demand for nano-transactions is forcing online
publishers to move away from ad-based business models. SatoshiPay
offers the solution to these needs and their platform enables
near-instant, micro-amount settlement mechanisms.
With its first-mover advantage, SatoshiPay is in a strong
position to capture a substantial market share. SatoshiPay has now
created over 20,000 wallets with 12,000 products and is working to
broaden its market share through strategic partnerships with
payment companies like Visa and content publishers.
Factom Inc
Factom's Blockchain technology secures data for large private
and public organizations by publishing encrypted data or a
cryptographically unique fingerprint of the data to Factom's
immutable, distributed ledger. This immutable data serves as a
"proof of existence" and source of truth for all future business
processes. Factom removes the need for blind trust by providing
precise, verifiable, and immutable audit trail.
In September Factom announced that it had raised $4.2m in new
funding in its Series A financing round, led by venture capitalist
Tim Draper of Draper Associates. It also recently won a $200,000
grant from the US Department of Homeland Security as well as a
grant from the Bill & Melinda Gates foundation. The Austin,
Texas-based company plans to use the new funds to more aggressively
grow the company, including building a series of new products for
its blockchain data network.
Vemo Education
Vemo works with higher education institutions and their
affiliates in the USA to develop and deploy income-based financing
programs, which align the cost of a student's education with its
value. As previously announced, Vemo provided technical advice and
utilizing its proprietary algorithms, to Purdue University to
research the use of Income Share Agreements (ISAs) - agreements in
which investors front a student's money for college in exchange for
a percentage of the student's post-graduation income - in a program
called Back a Boiler. This year saw Vemo continue its work with
Purdue University to officially launch that program with over 140
students now using the funding option at Purdue University, the
largest ISA program of its kind in the U.S.
In November 2016, Vemo raised sufficient capital to fund it's
development for the next two years. While the price per share
negotiated for this fund raise was less than we anticipated, we
believe that the new investors introduced, led by University
Ventures, give Vemo access to resources which greatly increase the
overall likelihood of a positive return, over time.
Yooya Media (formerly Entertainment Direct Asia)
Yooya is one of the first online video networks of its kind in
China built specifically to connect and unify the three linchpins
of the online video market in China: publishers, platforms, and
advertisers. Yooya has been instrumental in helping publishers
monetize in China's fragmented online video market by providing a
single platform for content distribution, rights management, and
advertising solutions. Yooya brings together many key components
essential to the equation, including licensing at scale, automated
ad sales, consolidated data & analytics, and dramatically
simplified content distribution.
Yooya has recently reported that it has exceeded 1 billion
monthly video views of its China-based Online Video network and a
634% growth in monthly video views over 12 months, both significant
milestones for the company. The company continues to attract major
content creators to its platform, contributing to its growth in
viewership. With a sizeable creator network, the company can offer
the scale and size that major advertisers require, providing unique
and un-paralleled opportunities to reach Chinese consumers through
online video.
Vested Finance Inc ("Schoold")
Schoold transforms college and career planning by using
technology to educate, inform and inspire users about their
prospects for a successful future. Schoold is a big-data driven
college and career counsellor mobile app with proprietary
technologies that exploits the leading data science technologies to
assist students.
Schoold's Viewbook product, targeted at Universities and
Colleges has been formally released and enables its customers to
engage with the 1.5 million+ students within the app. Schoold had a
strong response to this product and has already partnered with over
30 American Colleges & Universities. We believe there is an
appreciably large market for this product; marketers at Colleges
& Universities in the United States spend over $5 billion per
annum marketing to prospective students in the US. The company has
begun marketing the program in the United States and aims to expand
internationally in 2017
Fund raising and changes to share capital
During the period the Company has issued shares as follows:
Date Number of shares Amount raised Note
issued (GBP)
14 April 1,000,000 - 1
24 May 855,031 28,387 2
2 June 1,181,022 - 3
Note 1 - FastForward has agreed to grant 1,000,000 Ordinary
Shares to a newly appointed special adviser (see note 10)
Note 2 - Exercise of warrants in respect of Ordinary Shares at
an exercise price of 3.32 pence per Ordinary Share (see note
10)
Note 3 - FastForward issued an additional 1,181,022 Ordinary
Shares at 1p per share as partial payment of the second investment
in Fralis LLC (Leap Gaming).
Management team
I am pleased to welcome Josh Epstein as a partner and company
secretary of FastForward. Mr. Epstein began his legal career with
the international law firm of Baker Botts, LLP, where his practice
focused on venture capital, mergers and acquisitions, and private
and public securities offerings. Subsequently, Mr Epstein continued
to practice with Bissex & Watson, P.C., a boutique corporate
law firm based in Austin, Texas. Mr. Epstein has also been an
investor and principal in successful ventures across multiple
industries. Mr. Epstein holds degrees in Finance and English from
the University of Texas at Austin and his Juris Doctorate from the
University of Texas School of Law, where he graduated with Honors
and as a member of the Texas Law Review. Mr Epstein also holds an
MBA from the Acton School of Business in Austin, Texas, where he
was Valedictorian of his MBA class. Mr. Epstein brings an
entrepreneurial spirit as well as fantastic background in legal and
financial matters, which has already proven invaluable to both
FastForward and our investee companies.
Our team was further strengthened by the appointment of Norbert
Teufelberger as Special Adviser. Norbert's experience in building
one of the most successful global online gaming companies is a
serious advantage for the Company. Norbert has a deep set of
relationships across a multitude of technology sectors and a keen
understanding of the overall consumer internet space. His knowledge
and network's have been a major strength to us already.
After the period end Bryan Smith resigned as a director of the
Company. I want to put on record my personal thanks for the helpful
advice and support Bryan has given me while we worked together and
to wish him every success in the future.
Outlook
In 2016, FFWD completed a significant number of new and
follow-on investments. We believe we have now built a solid
infrastructure and platform for early-stage and growth investing,
with a board and management team comprised of some of the best
minds in investing and technology from across the world.
Building innovative, disruptive businesses who strive to change
the world is not simple and, by definition, takes time. As such, as
investors in early-stage companies, we take a long-term view in our
investments. That said, as we reflect on 2016 and look forward to
2017, we believe we will continue to see our investee companies
build upon the positive momentum they have already established.
Our focus will continue to be identifying the best management
teams operating high-growth businesses in industries that hold
great promise. We will continue to work closely with our investee
companies to assist them in leveraging opportunities to build their
businesses and, where appropriate, seek exits for our investments
when circumstances dictate. We look forward to continuing to report
to our shareholders regarding the achievements made by our investee
companies as the new year gets underway.
Lorne Abony
20 December 2016
DIRECTORS' RESPONSIBILITIES STATEMENT
The Directors are responsible for preparing these unaudited
condensed half-yearly financial statements, which have not been
reviewed or audited by the Company's independent auditors, and are
required to:
-- prepare the unaudited half-yearly financial statements in
accordance with International Accounting Standard 34: Interim
Financial Reporting;
-- include a fair review of important events that have occurred
during the period, and their impact on the unaudited half-yearly
financial statements, together with a description of the principal
risks and uncertainties of the Company for the remaining six months
of the financial year as detailed in the Co-Chairmen's Statement;
and
-- include a fair review of related party transactions that have
taken place during the six month period which have had
-- a material effect on the financial position or performance of
the Company, together with disclosure of any changes in related
party
transactions in the last annual financial statements which have
had a material effect on the financial position of the Company in
the current period.
The Directors confirm that the unaudited condensed half-yearly
financial statements comply with the above requirements and are
signed on behalf of the Board of Directors by:
Ian Burns
Director
20 December 2016
CONDENSED HALF-YEARLY STATEMENT OF COMPREHENSIVE INCOME
for the six months ended 30 September 2016
1 April 2016 1 April 2015 1 April 2015
to to to
30 September 30 September 31 March
2016 2015 2016
(unaudited) (unaudited) (audited)
Note GBP'000 GBP'000 GBP'000
Investment gains and losses
Income from derivative financial
instruments designated at fair
value through profit and loss - 149 149
Loss on derivative financial
instruments designated at fair
value through profit and loss - (163) (163)
Unrealised gain on investment
at fair value through profit
and loss 508 1 159
Total investment gains and (losses) 508 (13) 145
Income
Bank interest income 1 1 1
Total income 1 1 1
Expenses
Legal and professional fees (94) (52) (173)
Nominated Adviser and broker's
fees (76) (25) (157)
Administration fees (43) (12) -
Other expenses (195) (25) (187)
Directors' and special adviser
remuneration (271) - (1,228)
Total expenses (679) (114) (1,745)
Net loss from operating activities
before gains and losses on foreign
currency exchange (170) (126) (1,599)
------------- ------------- -------------
Net foreign currency exchange
gains/(losses) 241 (9) 126
Total comprehensive profit/(loss)
for the period/year 71 (135) (1,473)
============= ============= =============
Profit/(loss) per Ordinary Share
- basic and diluted 6 0.05p (0.46p) (2.69p)
All the items in the above statement are derived from continuing
operations.
CONDENSED STATEMENT OF FINANCIAL POSITION
as at 30 September 2016
30 September 30 September 31 March
2016 2015 2016
(unaudited) (unaudited) (audited)
Note GBP'000 GBP'000 GBP'000
Non-current assets
Investments designated at
fair value through profit
or loss 8,095 466 4,238
---------------- ----------------- --------------
Current assets
Financial instruments within
the brokerage account - 242 -
Other receivables 18 33 4,714
Cash and cash equivalents 2,539 374 1,415
2,557 649 6,129
Total assets 10,652 1,115 10,367
---------------- ----------------- --------------
Current liabilities
Payables and accruals (38) (36) (90)
Net assets 10,614 1,079 10,277
================ ================= ==============
Capital and reserves attributable
to equity holders of the Company
Share capital 10 1,339 420 1,309
Deferred share reserve 10 630 630 630
Other reserve 2,293 2,293 2,293
Employee stock option reserve 948 - 895
Distributable reserves 5,404 (2,265) 5,150
Total equity shareholders'
funds 10,614 1,078 10,277
================ ================= ==============
Net assets per Ordinary Share
- basic 7.92p 2.57p 7.85p
and diluted 9 7.92p 2.57p 7.82p
CONDENSED HALF-YEARLY STATEMENT OF CHANGES IN EQUITY
for the six months ended 30 September 2016 (unaudited)
Employee
Deferred stock
Share shares Other option Distributable
capital reserve reserve reserve reserves Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 31 March 2016 1,309 630 2,293 895 5,150 10,277
Total comprehensive loss
for the period - - - - 71 71
Transactions with shareholders
Issue of Ordinary Shares
(note 10) 30 - - - 183 213
Employee share scheme - - - 53 - 53
Balance at 30 September
2016 1,339 630 2,293 948 5,404 10,614
========= ========= ========= ========= ============== ========
for the six months ended 30 September 2015 (unaudited)
Employee
Deferred stock
Share shares Other option Distributable
capital reserve reserve reserve reserves Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 31 March 2015 274 630 2,293 - (2,734) 463
Total comprehensive loss
for the period - - - - (135) (135)
Transactions with shareholders
Issue of Ordinary Shares
(note 10) 146 - - - 604 750
Balance at 30 September
2015 420 630 2,293 - (2,265) 1,078
========= ========= ========= ========= ============== ========
for the year ended 31 March 2016 (audited)
Employee
Deferred stock
Share shares Other option Distributable
capital reserve reserve reserve reserves Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 31 March 2015 274 630 2,293 - (2,734) 463
Total comprehensive loss
for the year - - - - (1,473) (1,473)
Transactions with shareholders
Issue of Ordinary Shares 1,067 - - - 9,672 10,739
Acquisition of Treasury
Shares (32) - - - (315) (347)
Employee share scheme - - - 895 - 895
Balance at 31 March 2016 1,309 630 2,293 895 5,150 10,277
========= ========= ========= ========= ============== ========
CONDENSED HALF-YEARLY STATEMENT OF CASH FLOWS
for the six months ended 30 September 2016
1 April 2016 1 April 2015 1 April 2015
to to to
30 September 30 September 31 March
2016 2015 2016
(unaudited) (unaudited) (audited)
GBP'000 GBP'000 GBP'000
Cash flows from operating activities
Bank interest received 1 1 1
Nominated Adviser and broker's
fees paid (87) (30) (166)
Legal and professional fees paid (8) (13) (108)
Administration fees paid (51) (12) -
Other expenses paid (289) (28) (145)
Directors' remuneration paid (237) - (329)
Net cash outflow from operating
activities (671) (82) (747)
Cash flows from investing activities
Purchase of investments (2,968) (118) (3,385)
Transferred from broker 4,732 - 240
Net cash inflow/(outflow) from
investing activities 1,764 (118) (3,145)
Cash flows from financing activities
Proceeds from issue of Ordinary
Shares 28 337 5,423
Payments for Ordinary Shares
bought back - - (347)
Net cash inflow from financing
activities 28 337 5,076
Increase in cash and cash equivalents 1,121 137 1,184
============= ============= =============
Cash and cash equivalents brought
forward 1,415 237 237
Increase in cash and cash equivalents 1,121 137 1,184
Foreign exchange movement 3 - (6)
Cash and cash equivalents carried
forward 2,539 374 1,415
============= ============= =============
NOTES TO THE CONDENSED HALF-YEARLY FINANCIAL STATEMENTS
for the six months ended 30 September 2016
1. General Information
The Company is a closed-ended investment company, in line with
its Investing Policy as described on page 1.
The Company is domiciled and incorporated as a limited liability
company in Guernsey.
The registered office of the Company is 11 New Street, St Peter
Port, Guernsey, GY1 2PF (formerly 1st Floor, Royal Chambers, St
Julian's Avenue,
St Peter Port, Guernsey, GY1 3JX).
The Company's Ordinary Shares are traded on AIM, a market
operated by the London Stock Exchange.
2. Statement of Compliance
These unaudited condensed half-yearly financial statements,
which have not been independently reviewed or audited, have been
prepared in accordance with
International Accounting Standard 34: Interim Financial
Reporting.
They do not include all of the information required for full
annual financial statements
and should be read in conjunction with the audited financial
statements for the year ended 31 March 2016.
The unaudited condensed half-yearly financial statements were
approved by the Board of Directors on 20 December 2016.
3. Significant Accounting Policies
These unaudited condensed half-yearly financial statements have
adopted the same accounting policies as the last audited financial
statements, which were prepared in accordance with International
Financial Reporting Standards ("IFRS"), issued by the
International
Accounting Standards Board, interpretations issued by the IFRS
Interpretations Committee and applicable legal and regulatory
requirements of Guernsey Law and
reflect the accounting policies as disclosed in the Company's
last audited financial statements, which have been adopted and
applied consistently.
4. Critical Accounting Estimates and Judgments
The preparation of financial statements in conformity with IFRS
requires management to make judgments, estimates and assumptions
that affect the application of accounting policies and the reported
amounts of assets and liabilities, income and expenses. The
estimates and associated assumptions are based on historical
experience and various other factors that are believed to be
reasonable
under the circumstances, the results of which form the basis
of
making the judgments about carrying values of assets and
liabilities
that are not readily apparent from other sources. Actual results
may differ from these estimates.
Management makes estimates and assumptions concerning the future
of the Company. The resulting accounting estimates will, by
definition,
seldom equal the related actual results. Management believe that
the underlying assumptions are appropriate and that the financial
statements are fairly
presented.
The estimates and assumptions that have a significant risk of
causing a material adjustment to the carrying amounts of assets and
liabilities
within the next financial year are outlined below:
Judgments
Going concern
After making reasonable enquiries, and assessing all data
relating to the Company's liquidity, Management have a reasonable
expectation that
the Company has adequate resources to continue in operational
existence for the foreseeable future and do not consider there to
be any threat to the going concern
status of the Company. For this reason, they continue
to adopt the going concern basis in preparing the financial
statements.
4. Critical Accounting Estimates and Judgments (continued)
Estimates and assumptions
Fair Value of financial instruments
The fair values of securities that are not quoted in an active
market are determined by using valuation techniques as explained in
the International Private Equity and Venture Capital Valuation
Guidelines ("IPEV Guidelines"), primarily earnings multiples,
discounted cash flows and recent comparable transactions. The
models used to determine fair values are validated and periodically
reviewed by the Company. The inputs in the earnings multiples
models include observable data, such as earnings multiples of
comparable companies to the relevant portfolio company, and
unobservable data, such as forecast earnings for the portfolio
company. In discounted cash flow models, unobservable inputs are
the projected cash flows of the relevant portfolio company and the
risk premium for liquidity and credit risk that are incorporated
into the discount rate. However, the discount rates used for
valuing equity securities are determined based on historic equity
returns for other entities operating in the same industry for which
market returns are observable. Management uses models to adjust the
observed equity returns to reflect the actual equity financing
structure of the valued equity investment. Models are calibrated by
back-testing to actual results/exit prices achieved to ensure that
outputs are reliable.
Valuation of Options
The fair values of the options are measured using the
Black-Scholes model. The Black-Scholes model is considered an
acceptable model where options are subject to market conditions as
defined within IFRS 2.
The Black-Scholes model takes into account the following factors
when calculating the fair value of the share options at grant
date:
-- any market vesting conditions;
-- the expected term of the options (see below);
-- the expected volatility of the Company's share price as at grant date;
-- the risk-free rate of return available at grant date;
-- the Company's share price at grant date;
-- the expected dividends on the Company's shares over the expected term of the options; and
-- the exercise (strike) price of the options.
The expected term of the options is assumed to be 5 years from
the grant date. However, the options can be exercised at any point
after vesting and within a 10 year period from the grant date. As
the management of the Company are unsure as to when the options
will be exercised, it is assumed they will be exercised half way
through the 10 year period from grant date to lapse date which is 5
years.
Functional currency
The Board of Directors considers Sterling to be the currency
that most faithfully represents the economic effect of the
underlying transactions, events and conditions.
5. Segmental Information
In accordance with International Financial Reporting Standard 8:
Operating Segments, it is mandatory for the Company to present and
disclose
segmental information based on the internal reports that are
regularly reviewed by the Board in order to assess each segment's
performance
and to allocate resources to them.
Management information for the Company as a whole is provided
internally to the management for decision-making purposes. The
management's asset allocation decisions are based on an, integrated
investment strategy and the Company's performance
is evaluated on an overall basis. The single segment is
investments in companies which have significant intellectual
property rights which they are seeking to exploit,
principally within the technology sector (including digital
technology,
and content focused businesses) and the life sciences sectors
(including biotech and pharmaceuticals). Initially the geographical
focus will be North America and Europe
but investments may also be considered in other regions
to the extent that the Board considers that valuable
opportunities exist and positive returns can be achieved.
The internal reporting provided to the Board for the Company's
assets, liabilities and performance is prepared on a consistent
basis with the measurement and recognition principles of IFRS.
5. Segmental Information (continued)
All of the Company's investment portfolio income was derived
from its investments whose business focus is in the sectors as
described above. The only other revenue generated by the Company
during the period was interest of GBP911 (30 September 2015:
GBP504; 31 March 2016; GBP1,000), arising from cash and cash
equivalents,
which was generated in Guernsey. The Company is domiciled in Guernsey.
6. Gain per Ordinary Share - basic and diluted
The gain per Ordinary Share of 0.05p (30 September 2015: loss of
0.46p; 31 March 2016: loss of 2.69p) is based on the profit for the
period of GBP71,000 (30 September 2015: loss of GBP134,000; 31
March 2016: loss of GBP1,473,000) and on a weighted average number
of 133,154,382 Ordinary Shares in issue during the period (30
September 2015: 29,439,743 Ordinary Shares and 31 March 2016:
54,750,152 Ordinary Shares).
The average share price of the Ordinary Shares during the year
was below the exercise price of the Options (exercise price of
20.00 pence). Therefore, as at 30 September 2016 the Options had no
dilutive effect.
7. Dividends
The Directors do not propose an interim dividend for the period
ended 30 September 2016 (30 September 2015 and 31 March 2016:
GBPnil).
8. Tax Effects of Other Comprehensive Income
During the periods ended 30 September 2016, 30 September 2015
and 31 March 2016, there was no other comprehensive income
disclosed in the statement of comprehensive income and, as a
result, there were no tax effects arising thereon.
9. Net Assets per Ordinary Share
Basic
The basic net assets value per Ordinary Share is based on the
net assets attributable to equity shareholders of GBP10,614,000 (30
September 2015: GBP1,079,000; 31 March 2016: GBP10,277,000) and on
151,197,775 Ordinary Shares in issue at the end of the period (30
September 2015: 41,997,419 Ordinary Shares, 31 March 2016:
130,949,822 Ordinary Shares).
Diluted
Although the 30 September 2016 share price of the Ordinary
Shares was above the exercise price of the Broker Warrants, there
was no dilutive effect, as the exercise price was above the NAV per
share.
10. Share Capital, Warrants and
Options
30 September 30 September 31 March
2016 2015 2016
GBP'000 GBP'000 GBP'000
Authorised:
1,910,000,000 Ordinary Shares of
1p 19,100 19,100 19,100
100,000,000 Deferred Shares of
0.9p 900 900 900
20,000 20,000 20,000
============== ============== ==========
Allotted, called up and fully paid:
133,985,875 Ordinary Shares of
1p (31 March 2016:
130,949,822 Ordinary Shares, 30
September 2015:
41,997,419 Ordinary Shares) 1,339 420 1,309
70,700,709 Deferred Shares of 0.9p 630 630 630
============== ============== ==========
Warrants:
Broker Warrants - 855 -
Options:
Share options 17,680 - 16,680
10. Share Capital, Warrants and Options (continued)
Warrants
On 9 May 2016, Peterhouse assigned their 855,031 Broker Warrants
over to Stifel on the same terms as set out in the initial Warrant
Deed
dated 13 November 2014. On 23 May 2016, the 855,031 Broker
Warrants were exercised for a price of 3.32p per Ordinary Share and
for total consideration of GBP28,387.
Deferred Shares
In aggregate (not per share), the holders of Deferred Shares
shall be entitled to receive up to GBP1 only as a preferred
dividend or distribution. The
Deferred Shares have zero economic value. The holders of
Deferred Shares, in respect of their holdings of Deferred Shares,
shall not have the right to received notice of any general meeting
of the Company,
nor the right to attend, speak or vote at any such general
meeting. The Company has the right to transfer the Deferred Shares
to such persons
as it wishes, without the consent of the holders of the Deferred
Shares,
and to cancel Deferred Shares with the consent of such
transferee.
Options
On 14 April 2016, the Company appointed Norbert Teufelberger as
a Special Adviser.
Mr Teufelberger will support the Company's initiatives in
identifying early stage investment opportunities in the technology
and gaming industry,
given his extensive experience across these sectors. The Company
has agreed to grant 1,000,000 Options over
Ordinary Shares in the Company on the same terms as the Options
granted to the Directors, on 17 February 2016.
Directors' Authority to Allot Shares
The Directors are generally and unconditionally authorised to
exercise all the powers of the Company to allot relevant
securities
and subject to the terms the Directors may determine up to a
maximum aggregate nominal amount of GBP5,000,000 (representing
5,000,000,000
Sub-Ordinary Shares of GBP0.001 each, or 500,000,000 New
Ordinary Shares of GBP0.01 each). Authority under this resolution
will expire on the date
falling five years after the date of the Annual General
Meeting.
The Guernsey Companies Law does not limit the power of Directors
to issue shares or impose any pre-emption rights on the issue of
new shares. Accordingly,
the Directors are generally and unconditionally authorised to
allot securities in the Company up to the authorised but unissued
share
capital of the Company, any such power not to be limited in
duration.
Changes in share capital during the period
As mentioned above, in May 2016, the Company received notice to
exercise 855,031 Warrants at an exercise price of 3.32p each, for a
total of
GBP28,387.
In April 2016, the Company issued an additional 1,181,022
Ordinary Shares at 1p per share to satisfy an overpayment made in
the Secondary investment in Fralis LLC (Leap Gaming). The total
consideration for the shares was US$250,000, which equated to
GBP174,092.
One further change to Share Capital has occurred as described
under the Options section above.
11. Related Parties
Mr Dattels, a director of FastForward, is a discretionary
beneficiary of a trust which owns Regent Mercantile Holdings
Limited ("Regent"), which held 15,209,248 (30 September 2015:
8,024,469) Ordinary Shares in the Company at 30 September 2016 and
the date of signing this report. Mr Burns is the Managing Director
of Regent.
Mr Mellon, a director of FastForward, is a life tenant of a
trust which owns Galloway Limited ("Galloway"), which held
10,425,992 (30 September 2015: 8,024,469) Ordinary Shares in the
Company at 30 September 2016 and at the date of signing this
report.
At 30 September 2016 FastForward held 25,978 Ordinary Shares in
The Diabetic Boot Company Ltd ("DBC"). Galloway and Regent Pacific
Group Limited also hold shares in DBC. The combined shareholding in
DBC is in excess of 30%. Regent Pacific Group is deemed to be a
related party as Mr Mellon and Mr Dattels were Co-Chairmen of
Regent Pacific Group Limited until Mr Dattels resignation as a
director of Regent Pacific Group Limited on 1 September 2016.
Mr Burns, a director of FastForward, is the legal and beneficial
owner of Smoke Rise Holdings Limited ("Smoke"), which held
1,374,024 (30 September 2015: 1,250,831) Ordinary Shares in the
Company at 30 September 2016 and at the date of signing this
report.
11. Related Parties (continued)
Mr Smith held 1,155,668 (30 September 2015: 500,332) Ordinary
Shares in the Company at 30 September 2016 and at the date of
signing this report. Mr Smith resigned as a director of FastForward
on 17 November 2016.
Mr Abony, a director of FastForward, held 24,496,871 (31 March
2016: 26,438,391) Ordinary Shares in the Company at 30 September
2016 and at the date of signing this report.
As at 30 September 2016 FastForward held 1,527,059 (30 September
2015: Nil) non-assessable series-2 preferred stocks in Vemo
Education. Inc ("Vemo"), a company related by virtue of common
shareholdings with Mr Abony. Mr Abony is also the non-executive
Chairman of Vemo.
In July 2016, FastForward purchased an additional 798,374 seed
series shares in Schoold Inc for total cash consideration of
US$700,000. As at 30 September 2016 FastForward holds a total of
1,938,909 shares in Schoold. Mr Abony is a substantial shareholder
and the non-executive chairman of Schoold.
The Directors' remuneration for the period ended 30
September2016 totalled GBP207,000 (30 September2015: GBPNil).
The Directors consider that there is no immediate or ultimate
controlling party.
12. Events after the financial reporting date
There are no significant events subsequent to the period end
date.
13. Capital management policy and procedures
FastForward does not currently intend to fund any investments
through debt or other borrowings but may do so if appropriate.
Investments in early stage
assets are expected to be mainly in the form of equity, with
debt potentially being raised later to fund the development of such
assets.
Investments in later stage assets are more likely to include an
element of debt to equity gearing. The Company may also offer new
Ordinary Shares by way of consideration as well as cash, thereby
helping to preserve
the Company's cash for working capital and as a reserve against
unforeseen contingencies including, for example, delays in
collecting accounts
receivable, unexpected changes in the economic environment and
operational problems.
The Board monitors and reviews the structure of the Company's
capital on an ad hoc basis. This review includes:
-- The need to obtain funds for new investments, as and when they arise.
-- The current and future levels of gearing.
-- The need to buy back Ordinary Shares for cancellation or to be held in treasury,
which takes account of the difference between the net asset
value per
Ordinary Share and the Ordinary Share price.
-- The current and future dividend policy; and
-- The current and future return of capital policy.
FastForward is not subject to any externally imposed capital
requirements.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR QBLFLQLFFFBV
(END) Dow Jones Newswires
December 20, 2016 11:39 ET (16:39 GMT)
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