First Sentinel Plc - Interim Results
PR Newswire
London, September 30
This announcement contains inside information for the purposes of the Market Abuse Regulation (EU No. 596/2014) ("MAR"). Upon the publication of this announcement, this inside information is now considered to be in the public domain and shall therefore cease to be inside information.
First Sentinel Plc - Interim Results
30 September 2020
First Sentinel Plc
("First Sentinel" or the "Company")
Interim results for the period ended 30 June 2020
First Sentinel is pleased to announce its interim accounts for the six months ended 30 June 2020 (the "Interim Accounts"). Extracts of the Interim Accounts are set out at https://first-sentinel.com.
The Chairman's Report
I present the results for First Sentinel plc for the six months ended 30 June 2020. These have been challenging times but, despite the outbreak of the Covid-19 pandemic in the first months of 2020, I am delighted to report that First Sentinel has been able to mobilise its staff to work from home with very little disruption to our business. Since the effects of the pandemic took hold, we have adapted our strategy in order to focus on resilient industries.
Between January and June 2020, First Sentinel raised £1,734,426 and deployed the proceeds on a number of loan facilities and on its UK supply chain finance business via its subsidiary, Capable Finance Limited. First Sentinel's Australian subsidiary, Perennial Enterprise PTY Ltd, continues to progress well and its robust capital deployment strategy has kept its financial results immune from the effects of the pandemic. In addition, the Company has made equity investments (Stabilitech, now renamed iosBio, and Vulcan Industries) which have contributed to increasing value to our shareholders.
Our strategy during the first 6 months of 2020 has proved successful and I am pleased to report a profit of 1.12p per share (YE 2019: loss of 4.24p per share). In the next 6 months, we intend to enhance the Group's focus on our UK invoice purchasing and supply chain finance activities whilst taking advantage of equity investment opportunities that are aligned with our risk profile and investment strategy.
Outlook
The six months to 30 June 2020 have continued to be a very successful period for First Sentinel. The success of the fund raising, investments made and the establishment of supply chain finance operations in the UK has positioned the Group very well for the next stage of its development. Our short-term strategy remains at increasing value by providing growth capital for public and private company investments and, in particular, by significantly growing the invoice purchasing activities in Australia and the supply chain finance operations in the UK. I am very optimistic about the Group's growth potential and we look to the future with significant confidence.
About First Sentinel plc
First Sentinel PLC provides debt financing solutions for small to medium-sized businesses primarily through its supply chain finance and invoice purchasing activities. First Sentinel also invests in a range of secured and unsecured equity and debt instruments in private and public companies.
The Company's website is https://first-sentinel.com
For further corporate information, please contact:
Mr. Brian Stockbridge
CEO
First Sentinel Plc
Tel: + 44 (0) 7876 888 011
AQSE Corporate Advisor
Beaumont Cornish Limited
James Biddle / Roland Cornish
Tel: +44(0)20 7628 3396
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Interim Condensed Statement of Comprehensive Income
Notes | 6 months Ended 30 June 2020 Unaudited | 6 months Ended 30 June 2019 Unaudited | Year ended 31 December 2019 Audited | |||
| £'000 | £'000 | £'000 | ||||
| Revenue | 1,199 | 710 | 1,440 | |||
| Cost of sales | - | (185) | (89) | |||
| Gross profit | 1,199 | 525 | 1,351 | |||
| Administrative expenses | 4 | (678) | (591) | (1,534) | ||
| Other Income | - | 21 | 33 | |||
| Operating profit / (loss) | 521 | (45) | (150) | |||
| Finance Costs | (249) | (326) | (587) | |||
| Finance Income | - | 257 | 33 | |||
| Profit / (loss) on ordinary activities before taxation | 272 | (114) | (704) | |||
| Tax on loss on ordinary activities | - | (24) | (63) | |||
| Profit / (loss) after taxation | 272 | (137) | (767) | |||
| Other comprehensive income | - | - | - | |||
| Total comprehensive profit / (loss) for the period | 272 | (137) | (767) | |||
| Profit / (loss) and total comprehensive attributable | ||||||
| the owners of the company | 205 | (137) | (855) | |||
| Non-controlling interests | 67 | - | 88 | |||
| 272 | (137) | (767) | ||||
| Basic and diluted Profit / (loss) per share (expressed in pence per share) | 5 | 1.12p | (0.90p) | (4.24p) | ||
Interim Condensed Statement of Changes in Equity
| Share Capital | Share Premium | Accumulated Deficit | Preference Share Equity Component | Share Based Payment Reserve | Non-Controlling interest | Foreign Exchange Reserve | Total Equity | |
| £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |
| Balance at 30 June 2019 | 152 | 1,449 | (1,092) | - | 26 | 154 | (113) | 576 |
| Issue of shares | 61 | 648 | - | - | - | - | - | 709 |
| Share based payments charge | - | - | - | - | 105 | - | - | 105 |
| Non-controlling interest | - | - | - | - | - | 92 | - | 92 |
| Foreign Exchange Difference | - | - | - | - | - | - | (134) | (134) |
| Loss and total comprehensive loss for the period | - | - | (717) | - | - | - | - | (717) |
| Balance at 31 December 2019 | 213 | 2,097 | (1,809) | - | 131 | 245 | (245) | 632 |
| Issue of shares | 50 | 1,021 | - | 41 | - | - | - | 1,112 |
| Non-Controlling Interest | - | - | - | - | - | (229) | - | (229) |
| Share based payments charge | - | - | - | - | 84 | - | - | 84 |
| Foreign Exchange Difference | - | - | 104 | - | - | - | 196 | 300 |
| Loss and total comprehensive loss for the period | - | - | 205 | - | - | 67 | - | 272 |
| Balance at 30 June 2020 | 263 | 3,118 | (1,500) | 41 | 215 | 83 | 49 | 2,171 |
Share capital is the amount subscribed for shares at nominal value.
Share premium is the amount subscribed for shares in excess of nominal value.
Accumulated deficit represents the cumulative loss of the Group attributable to equity shareholders.
Interim Condensed Statement of the Financial Position
Notes | 6 months Ended 30 June 2020 Unaudited | 6 months Ended 30 June 2019 Unaudited | Year ended 31 December 2019 Audited | |
| £'000 | £'000 | £'000 | ||
| Assets | ||||
| Non-Current Assets | ||||
| Intangible Assets | 51 | 51 | 48 | |
| Goodwill | 88 | 88 | 88 | |
| Property, Plant & equipment | 189 | 79 | 54 | |
| Right of use Asset | 198 | - | 131 | |
| Total non-Current Assets | 526 | 218 | 321 | |
| Current assets | ||||
| Trade Receivables | 6,136 | 5,112 | 5,730 | |
| Other Receivables | - | 9 | - | |
| Other financial assets | 6 | 2,072 | 662 | 242 |
| Cash and Cash Equivalents | 741 | 1,790 | 1,255 | |
| Total Current Assets | 8,950 | 7,573 | 7,228 | |
| Total Assets | 9,476 | 7,791 | 7,549 | |
| Equity and Liabilities | ||||
| Share Capital | 7 | 263 | 152 | 213 |
| Share Premium | 7 | 3,118 | 1,449 | 2,097 |
| Preference share equity component | 41 | - | - | |
| Share based payment reserve | 215 | 26 | 131 | |
| Non-controlling interest | 83 | 154 | 245 | |
| Foreign Exchange reserve | (49) | (113) | (245) | |
| Accumulated deficit | (1,500) | (1,092) | (1,809) | |
| Total Equity | 2,171 | 576 | 632 | |
| Current Liabilities | ||||
| Trade Payables | 205 | 1,383 | 114 | |
| Short term lease liabilities | 202 | - | 31 | |
| Borrowings | 1,840 | - | 1,944 | |
| Other Payables | 14 | 145 | 170 | |
| Total Current Liabilities | 2,261 | 1,528 | 2,259 | |
| Non-current Liabilities | ||||
| Borrowings | 5,044 | 5,687 | 4,530 | |
| Other Payables | - | - | 128 | |
| Total non-current Liabilities | 5,044 | 5,687 | 4,658 | |
| Total Liabilities | 7,305 | 7,215 | 6,917 | |
| Total Equity and Liabilities | 9,476 | 7,791 | 7,549 |
Interim Condensed Cash Flow Statement
Notes | 6 months Ended 30 June 2020 Unaudited | 6 Months Ended 30 June 2019 Unaudited | Year ended 31 December 2019 Audited | ||
| £'000 | £'000 | £'000 | |||
| Cash flows from operating activities | |||||
| Operating profit/(loss) | 521 | (45) | (150) | ||
| Changes in working capital | |||||
| (Increase) / decrease in receivables | (406) | (843) | (1,514) | ||
| Increase / (decrease) in payables | (2) | 1,142 | (143) | ||
| Other adjustments | - | (172) | - | ||
| Depreciation | 22 | - | 113 | ||
| Fair value adjustments | (431) | - | 156 | ||
| Share based payment | 84 | - | 105 | ||
| Interest Received | - | (257) | 33 | ||
| Interest elements of lease payments | - | - | (10) | ||
| Interest Paid | (249) | - | (577) | ||
| Net cash flow from operating activities | (461) | (175) | (1,987) | ||
| Investing Activities | |||||
| Acquisition of subsidiary | 6 | - | - | (50) | |
| Net Proceeds from transactions of financial assets at fair value through profit or loss | (1,399) | 150 | 239 | ||
| Purchases of property, plant and equipment | (135) | - | (41) | ||
| Net cash flow from investing activities | (1,534) | 150 | 148 | ||
| Cash flows from financing activities: | |||||
| Net proceeds from issue of shares | 7 | 1,071 | - | 709 | |
| Net Proceeds from issue of financial liabilities at amortised cost - loans | (104) | - | 10 | ||
| Net Proceeds from issue of financial liabilities at amortised cost - bonds | 514 | 965 | 1,742 | ||
| Principal elements of lease payments | - | - | (97) | ||
| Net cash flow from financing activities | 1,481 | 965 | 2,364 | ||
| Taxation | - | 24 | (96) | ||
| Net cash flow for the period | (514) | 964 | 429 | ||
| Opening Cash and cash equivalents | 1,255 | 826 | 826 | ||
| Closing Cash and cash equivalents | 741 | 1,790 | 1,255 | ||
Notes to the Interim Condensed Financial Statements
1. General Information
First Sentinel plc ('the Company') is a trading company incorporated in the United Kingdom with company number 10183367 and quoted on the AQSE Exchange Growth Market.
2. Basis of Preparation
The annual financial statements of the Company and its subsidiaries (together referred to as the "Group") are prepared in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union. The condensed set of financial statements included in this interim financial report has been prepared in accordance with IAS 34 'Interim Financial Reporting', as adopted by the European Union. The accounting policies and methods of computation used are consistent with those used in the Group's latest audited financial statements for the year ended 31 December 2019.
A copy of the statutory accounts for the year ended 31 December 2019 has been delivered to the Registrar of Companies. The auditor's report on these accounts was unqualified, did not draw attention to any matters by way of emphasis and did not contain a statement under section 498(2) or (3) of the Companies Act 2006.
3. Segmental Reporting
The Group's management has determined the operating segments based on the reports reviewed by the executive directors that are used to make strategic decisions. They consider the business from a geographical perspective and the group has two reportable segments, the UK and Australia. The Group's main lines of business are that of making investments and invoice purchasing.
| For the period ended 30 June 2020: | UK | Australia | Total |
| £'000 | £'000 | £'000 | |
| Segment revenue and results | |||
| Reportable revenue | 688 | 511 | 1,199 |
| Revenue from external customers | 688 | 511 | 799 |
| Cost of Sales | - | - | - |
| Unallocated corporate income and expenses | (218) | (438) | (656) |
| Depreciation | (22) | - | (22) |
| Interest expense | (5) | (244) | (249) |
| Interest Income | - | - | - |
| Tax expense | - | - | - |
| Intersegment revenues/costs | (186) | 186 | - |
| Profit/(Loss) | 257 | 15 | 272 |
| Segment assets and liabilities | |||
| Reportable segment assets | 7,624 | 5,974 | 13,598 |
| Intersegment eliminations | (4,210) | - | (4,210) |
| Goodwill | 88 | ||
| Consolidated total assets | 9,476 | ||
| Reportable segment liabilities | 5,395 | 5,485 | 10,880 |
| Intersegment eliminations | - | (3,575) | (3,575) |
| Consolidated total liabilities | 7,305 | ||
| For the period ended 31 December 2019: | UK | Australia | Total |
| £'000 | £'000 | £'000 | |
| Segment revenue and results | |||
| Reportable revenue | (104) | 1,544 | 1,440 |
| Revenue from external customers | (104) | 1,544 | 1,440 |
| Cost of Sales | - | (89) | (89) |
| Other income | - | 33 | 33 |
| Unallocated corporate income and expenses | (932) | (490) | (1,422) |
| Depreciation and amortisation | (66) | (47) | (113) |
| Interest expense | (350) | (236) | (586) |
| Interest Income | 32 | 1 | 33 |
| Tax expense | - | (63) | (63) |
| Intersegment revenues/costs | 464 | (464) | - |
| Loss | (956) | 189 | (767) |
| Segment assets and liabilities | |||
| Reportable segment assets | 5,547 | 6,039 | 11,586 |
| Intersegment eliminations | (4,125) | - | (4,125) |
| Goodwill | 88 | ||
| Consolidated total assets | 7,549 | ||
| Reportable segment liabilities | 5,069 | 5,583 | 10,652 |
| Intersegment eliminations | - | (3,735) | (3,735) |
| Consolidated total liabilities | 6,917 | ||
| For the period ended 30 June 2019: | UK | Australia | Total |
| £'000 | £'000 | £'000 | |
| Segment revenue and results | |||
| Reportable revenue | 32 | 678 | 710 |
| Revenue from external customers | 32 | 678 | 710 |
| Cost of Sales | - | - | - |
| Unallocated corporate income and expenses | (321) | (259) | (580) |
| Tax expense | - | (24) | (24) |
| Loss | 105 | ||
| Segment assets and liabilities | |||
| Reportable segment assets | 4,497 | 3,122 | 7,617 |
| Goodwill | 92 | 92 | |
| Consolidated total assets | 7,710 | ||
| Reportable segment liabilities | 4,174 | 2,996 | 7,170 |
| Consolidated total liabilities | 7,170 | ||
| Other segment information | |||
| Interest expense | (152) | (359) | (511) |
| Interest income | 251 | 7 | 257 |
| Depreciation | - | - | - |
4. Group Result for the period
The current period operating loss incorporated the following main items:
| 6 months Ended 30 June 2020 Unaudited | 6 Months Ended 30 June 2019 Unaudited | Year ended 31 December 2019 Audited | |
| £'000 | £'000 | £'000 | |
| Directors' remuneration and fees | 53 | 152 | 477 |
| Legal and professional fees | 26 | 49 | 136 |
| Other expenses | 599 | 390 | 921 |
| 678 | 591 | 1,534 | |
5. Profit / Loss per Share
Profit / Loss per share data is based on the Group result for the six months and the weighted average number of shares in issue.
Basic loss per share is calculated by dividing the loss attributable to equity shareholders by the weighted average number of ordinary shares in issue during the period:
| 6 months Ended 30 June 2020 Unaudited | 6 Months Ended 30 June 2019 Unaudited | Year ended 31 December 2019 Audited | |
| £ | £ | £ | |
| Profit/(loss) after tax | 272,000 | (137,000) | (767,000) |
| Weighted average number of ordinary shares in issue | 24,224,324 | 15,228,089 | 18,073,929 |
| Basic and diluted Profit/(loss) per share (pence) | 1.12p | (0.90p) | (4.24p) |
Basic and diluted earnings per share are the same, since where a loss is incurred the effect of outstanding share options and warrants is considered anti-dilutive and is ignored for the purpose of the loss per share calculation. There were 26,324,316 potential dilutive shares in issue during the period for share options and warrants.
6. Financial assets
During the period the Group had the following movements in investments:
| 30 June 2020 Unaudited | At 30 June 2019 Unaudited | Year ended 31 December 2019 Audited | |
| £'000 | £'000 | £'000 | |
| Secured loan notes | - | 222 | - |
| Financial assets through profit and loss | 2,072 | 440 | 242 |
| Total financial assets | 2,072 | 662 | 242 |
7. Share Capital
Ordinary shares are classified as equity. Proceeds from issuance of ordinary shares are classified as equity. Incremental costs directly attributable to the issuance of new ordinary shares are deducted against share capital.
| Allotted, called up and fully paid ordinary shares of 0.01p each | Number of shares | Share Capital | Share Premium | |
| £ | £ | |||
| Balance at 17 May 2016 | 100 | 1 | - | |
| Balance at 30 June 2016 | 100 | 1 | - | |
| Share issue at £0.10 - 15 March 2017 | 6,309,794 | 63,098 | 511,233 | |
| Share issue at £0.10 - 24 March 2017 | 50,000 | 500 | 4,500 | |
| Share issue at £0.10 - 18 April 2017 | 727,273 | 7,273 | 72,727 | |
| Balance at 30 June 2019 | 15,246,770 | 152,467 | 1,448,340 | |
| Share issue at £0.14 - 05 August 2019 | 421,429 | 4,214 | 54,786 | |
| Share issue at £0.15 - 23 September 2019 | 1,666,667 | 16,667 | 233,333 | |
| Share issue at £0.10 - 25 October 2019 | 4,000,000 | 40,000 | 360,000 | |
| Balance at 31 December 2019 | 21,334,866 | 213,349 | 2,097,119 | |
| Share issue at £0.010 - 24 January 2020 | 815,462 | 8,155 | 212,020 | |
| Share issue at £0.010 - 11 March 2020 | 914,535 | 9,145 | 173,762 | |
| Share issue at £0.010 - 19 March 2020 | 1,944,810 | 19,448 | 369,514 | |
| Share issue at £0.010 - 23 April 2020 | 757,500 | 7,575 | 143,925 | |
| Share issue at £0.010 - 04 June 2020 | 557,143 | 5,571 | 111,428 | |
| Balance at 30 June 2020 | 26,324,316 | 263,243 | 3,107,768 | |
8. Events Subsequent to 30 June 2020
After the period end the Company has raised £200,000 from the initial tranches of Green Finance Preference Shares issued.
On the 28 August 2020 the company raised £179,077 by issuing 179,077 bonds
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