TIDMTMT
RNS Number : 3124S
TMT Investments PLC
23 September 2014
23 September 2014
TMT INVESTMENTS PLC
("TMT" or the "Company")
Half year report for the six months to 30 June 2014
TMT Investments PLC, which invests in high-growth,
internet-based companies across a variety of sectors, is pleased to
announce its unaudited interim results for the half year ended 30
June 2014.
Key highlights
-- NAV per share of US1.30 (unchanged from 31 December 2013)
-- A number of portfolio companies experiencing rapid growth but
lack recent corporate finance transactions to record increased
valuations
-- Some portfolio companies prove unsuccessful, reflecting the
early-stage nature of the Company's investments
-- Positive non-cash revaluation of Gild
-- Impairment of Graphicly
-- Negative non-cash revaluation of UsingMiles
-- US$1.2 million of new investments
-- Three senior managers receiving all of their 2014 salaries in
TMT shares rather than in cash, reducing cash expenses and further
aligning interests of management with shareholders
-- Well placed to capitalise on investment opportunities created
in the software applications, mobile apps, digital media and
internet sectors, with approximately US$3.1m in net cash reserves
as of the date of this report
EXECUTIVE DIRECTOR'S STATEMENT
Portfolio Performance
The first half of 2014 saw a number of investments evolving to
either successfully growing businesses or proving to be
unsuccessful. TMT has now invested in over 35 companies since its
floatation in December 2010 and has a diversified portfolio focused
around mobile software applications, cloud solutions, advertising
technologies, online social networks and data and project
management software. This level of diversification helps absorb any
write offs or negative revaluations that occur, and our NAV per
share as of 30 June 2014 stayed unchanged at US$1.30.
The following developments took place within the Company's
portfolio in the first half of 2014:
Cash and part-cash exits:
-- There were no cash or part-cash exists in the reporting period.
Positive non-cash revaluations:
-- In May 2014, Gild, Inc. ("Gild"), which identifies and ranks
outstanding IT programmers through harnessing big data and its own
proprietary algorithm, completed a new equity financing round. The
transaction represents an uplift of approximately US$379,000 (or
223%) in the fair value of TMT's investment in Gild, compared to
the amount reported as of 31 December 2013.
Impairments and write-offs:
-- In May 2014, Graphicly, Inc. ("Graphicly"), an e-book
publishing and distribution platform, announced its decision to
wind up its operations and that no assets or proceeds would be
available for distribution to Graphicly's shareholders. TMT is
pursuing a course of actions to recover its investment in Graphicly
but considers it prudent to incur an impairment charge equal to
100% of the fair value of the Company's investment in Graphicly
(approx. US$485,825).
Negative non-cash revaluations:
-- In October 2013, Universal Points Exchange, LLC, a wholly
owned subsidiary of Source, Inc. ("Source") and Help Worldwide,
Inc. ("HelpWW"), agreed to acquire the assets of UsingMiles Inc.
("UM") for shares ("Transaction"). A UM liquidating trust ("Trust")
has been established for the purposes of the Transaction. As a
result of the Transaction, the Trust owns 2.72% of the common stock
in Source and 2.455% of the common stock in HelpWW. The Trust will
hold these shares until there is a liquidity event for Source
and/or HelpWW or the Board of Trustees determines to distribute the
shares, at which time it will distribute the proceeds to the former
shareholders of UM. Once the creditors are paid off, any
distributions will next go to the Series A investors pro-rata until
they receive their preference of roughly US$5M, of which TMT will
receive 5.89%. After the Series A is paid off, TMT will receive
3.08% of the remaining proceeds. The Transaction closed on 31
December 2013, and TMT agreed to be included in the Trust on 11
August 2014. The transaction represents a reduction of
approximately US$230,000 (or 89%) in the fair value of TMT's
investment in UM, compared to the amount reported as of 31 December
2013.
New investments
In the first half of 2014, the Company invested US$860,000 in
five new companies (technology developer for visually impaired
people PROvision/Oriense, smartphone solution provider for senior
citizens E2C, mobile tech discovery service Drippler, on-demand
business research platform Whale Path, and "Internet of Everything"
software developer Weaved), as well as an additional US$350,000 in
three existing portfolio companies (Gentoo/Contacts+, rollApp, and
KitApps/Attendify).
NAV per share
The Company's net asset value per share as of 30 June 2014 was
US$1.30 (31 December 2013: US$1.30).
Operating Expenses
In the first half of 2014, the Company's Administrative Expenses
of US$652,287 were in line with the first half of 2013 levels
(US$649,772). Total Operating Expenses decreased in the reporting
period due to the lower share-based option charge of US$94,848
(first half of 2013: US$327,749).
Financial position
As of 30 June 2014, the Company had US$3.1 million in cash
reserves. In July 2014, TMT raised US$2.65 million at US$1.85 per
sharefrom a number of new and existing investors. As of the date of
this report, the Company has no debt and approximately US$3.1
million in cash reserves.
Events after the reporting period and outlook
Since 30 June 2014, the Company has invested US$2.2 million in
six new companies (productivity software developer Quote Roller,
fashion rental platform Le Tote, news reading app Anews, social
intelligence platform Twtrland, mobile interface application Drupe,
and taxi booking app Taxify), as well as US$600,000 in existing
portfolio company Adinch.
In August 2014, TMT announced the sale of its entire equity
stake in The One-Page Company, Inc. TMT's total consideration
received pursuant to the transaction was US$509,740, representing
an internal rate of return ("IRR") of 32%. TMT originally invested
US$250,000 in One-Page on 6 February 2012.
Further information on subsequent events is shown in note 16 to
the financial information.
We continue to have a strong pipeline of new investment
opportunities, and intend to complete a number of new and follow-on
investments by the end of 2014. With a number of our portfolio
companies experiencing rapid growth, we expect a number of positive
revaluations of our investee companies. At the same time, given the
risky nature of earlier-stage venture capital investments, we
expect some negative revaluations in due course as well.
We look forward to updating our shareholders on the Company's
progress in the near future.
Alexander Selegenev
Executive Director
For further information contact:
TMT Investments Plc +44 1534 281 843
Mr. Alexander Selegenev alexander.selegenev@tmtinvestments.com
www.tmtinvestments.com
ZAI Corporate Finance Ltd.
NOMAD and Broker
Richard Morrison/Irina Lomova +44 20 7060 2220
Kinlan Communications +44 20 7638 3435
David Hothersall davidh@kinlan.net
About TMT Investments
TMT Investments PLC invests in high-growth, internet-based
companies across a variety of sectors and has a significant number
of Silicon Valley investments in its portfolio. Founded in 2010,
TMT has raised USD30m and invested in over 35 companies to date.
The company's objective is to generate an attractive rate of return
for shareholders, predominantly through capital appreciation. The
company is traded on the AIM market of the London Stock Exchange.
www.tmtinvestments.com
Statements of Comprehensive Income
For the For the six
six months months ended
ended 30/06/2014 30/06/2013
Notes USD USD
(Losses)/gains on investments 3 (560,966) (173,528)
-------------------------------------------- ------ ------------------ --------------
Expenses
Administrative expenses 4 (652,287) (649,772)
Share-based payment charge 13 (94,848) (327,749)
-------------------------------------------- ------ ------------------ --------------
Operating loss (1,308,101) (1,151,049)
Net finance income 6 6,987 35,999
-------------------------------------------- ------ ------------------ --------------
Loss before taxation (1,301,114) (1,115,050)
Taxation - -
-------------------------------------------- ------ ------------------ --------------
Loss attributable to equity shareholders (1,301,114) (1,115,050)
Other comprehensive income/(loss) for
the period:
Change in fair value of available-for-sale
financial assets 8 1,254,610 5,164,448
-------------------------------------------- ------ ------------------ --------------
Total comprehensive (losses)/income
for the period (46,504) 4,049,398
-------------------------------------------- ------ ------------------ --------------
Loss per share
Basic and diluted loss per share (cents
per share) 7 (5.20) (4.45)
-------------------------------------------- ------ ------------------ --------------
Statements of Financial Position
At 30 June At 31 December
2014, USD 2013, USD
Non-current assets Notes
Investments in equity shares 8 28,299,290 26,932,335
Convertible loan notes receivable 8 2,692,617 2,193,304
----------------------------------- ------ -------------------- ------------------------
Total non-current assets 30,991,907 29,125,639
Current assets
Trade and other receivables 9 115,664 79,532
Cash and cash equivalents 10 3,122,289 3,242,269
Total current assets 3,237,953 3,321,801
Total assets 34,229,860 32,447,440
Current liabilities
Trade and other payables 11 1,271,750 96,008
Total liabilities 1,271,750 96,008
----------------------------------- ------ -------------------- ------------------------
Net assets 32,958,110 32,351,432
----------------------------------- ------ -------------------- ------------------------
Equity
Share capital 12 27,453,513 26,895,179
Share-based payment reserve 14 688,281 695,970
Fair value reserve 14 9,191,977 7,937,367
Retained losses 14 (4,375,661) (3,177,084)
Total equity 32,958,110 32,351,432
----------------------------------- ------ -------------------- ------------------------
Statements of Cash Flows
For the six For the
months ended six months
30/06/2014, ended 30/06/2013,
Notes USD USD
------------------------------------------------ ----- --------------- --------------------
Operating activities
Operating loss (1,308,101) (1,151,049)
------------------------------------------------ ----- --------------- --------------------
Adjustments for non-cash items:
Profit on disposal of convertible
notes 8 - (157,191)
Impairment charge 8 591,482 415,936
Share-based payment charge 13 94,848 327,749
Amortized costs of convertible notes
receivable 8 6,957 20,044
------------------------------------------------ ----- --------------- --------------------
(614,814) (544,511)
------------------------------------------------ ----- --------------- --------------------
Changes in working capital:
Increase in trade and other receivables 9 (36,132) (130,425)
Increase in trade and other payables 11 1,175,742 95,960
------------------------------------------------ ----- --------------- --------------------
Net cash from/(used by) operating
activities 524,796 (578,976)
------------------------------------------------ ----- --------------- --------------------
Investing activities
Interest received 6 6,987 35,999
Purchase of available-for-sale assets 8 (1,210,097) (1,521,970)
Proceeds from sale of available-for-sale-assets 8 - 606,507
------------------------------------------------ ----- --------------- --------------------
Net cash used by investing activities (1,203,110) (879,464)
------------------------------------------------ ----- --------------- --------------------
Financing activities
Cash proceeds from issue of shares 12 558,334 1,158,930
Purchase of own shares - (699,999)
------------------------------------------------ ----- --------------- --------------------
Net cash from financing activities 558,334 458,931
------------------------------------------------ ----- --------------- --------------------
Decrease in cash and cash equivalents (119,980) (999,509)
------------------------------------------------ ----- --------------- --------------------
Cash and cash equivalents at the beginning
of the period 10 3,242,269 7,717,554
------------------------------------------------ ----- --------------- --------------------
Cash and cash equivalents at the end
of the period 10 3,122,289 6,718,045
------------------------------------------------ ----- --------------- --------------------
Statements of Changes in Equity
Share capital Share-based Fair value Retained losses Total equity
payment reserve
reserve
USD USD USD USD USD
Notes
------------------- ------ -------------- --------------- --------------- ---------------- -------------
Balance at 1
January 2013 26,136,248 128,183 2,005,228 (1,336,201) 26,933,458
------------------- ------ -------------- --------------- --------------- ---------------- -------------
Total
comprehensive
loss for the
period - - 5,932,139 (1,849,303) 4,082,836
------------------- ------ -------------- --------------- --------------- ---------------- -------------
Issue of shares 1,458,930 - - - 1,458,930
Buy back and
cancellation of
shares (699,999) - - - (699,999)
Share-based
payment charge - 576,207 - - 576,207
Lapse of share
options - (8,420) - 8,420 -
Balance at 1
January 2014 26,895,179 695,970 7,937,367 (3,177,084) 32,351,432
------------------- ------ -------------- --------------- --------------- ---------------- -------------
Total
comprehensive
loss for the
period - - 1,254,610 (1,301,114) (46,504)
------------------- ------ -------------- --------------- --------------- ---------------- -------------
Issue of shares 14 558,334 - - - 558,334
Share-
based payment
charge 14 - 94,848 - - 94,848
Exercise of share
options 14 - (102,537) - 102,537 -
Balance at 30 June
2014 27,453,513 688,281 9,191,977 (4,375,661) 32,958,110
------------------- ------ -------------- --------------- --------------- ---------------- -------------
NOTES TO THE FINANCIAL INFORMATION FOR THE SIX MONTHS ENDED 30
JUNE 2014
1. Company information
TMT Investments Plc ("TMT" or the "Company") is a company
incorporated in Jersey with its registered office at Queensway
House, Hilgrove Street, St Helier, JE1 1ES, Channel Islands.
The Company was incorporated and registered on 30 September 2010
in Jersey under the Companies (Jersey) Law 1991 with registration
number 106628 under the name TMT Investments Limited. The Company
obtained consent from the Jersey Financial Services Commission
pursuant to the Control of Borrowing (Jersey) Order 1985 on 30
September 2010. On 1 December 2010 the Company re-registered as a
public company and changed its name to TMT Investments PLC.
TMT is traded on the AIM market of the London Stock
Exchange.
The memorandum and articles of association of the Company do not
restrict its activities and therefore it has unlimited legal
capacity. The Company's ability to implement its Investment Policy
and achieve its desired returns will be limited by its ability to
identify and acquire suitable investments. Suitable investment
opportunities may not always be readily available.
The Company will seek to make investments in any region of the
world.
The financial information relating to the six months ended 30
June 2014 is unaudited and does not constitute statutory accounts.
The comparative figures for the financial year ended 31 December
2013 are not the Company's statutory accounts for that financial
year. Statutory accounts for the year ended 31 December 2013 were
approved by the Board of Directors on 28 April 2014. The report of
the auditors on those accounts was unqualified, did not include a
reference to any matters to which the auditors drew attention by
way of emphasis without qualifying their report and did not contain
any qualification.
These unaudited interim financial results were approved by the
Board of Directors on 22 September 2014 and are available on the
Company's website
http://www.tmtinvestments.com/investor-relations/financial-reports/.
2. Summary of significant accounting policies
2.1 Basis of presentation
The accounting policies applied by the Company in these
unaudited interim results are based on International Financial
Reporting Standards as adopted by the European Union, including IAS
34 'Interim Financial Reporting', and in accordance with the
accounting policies which the Company expects to adopt in its next
annual accounts for the year ending 31 December 2014 and are the
same as those applied by the Company in its financial statements
for the year ended 31 December 2013.
The Company's financial risk management objectives and policies
are consistent with that disclosed in the financial statements for
the year ended 31 December 2013.
For the purposes of IFRS 8 'Operating Segments' the Company
currently has one segment, being 'Investing in the TMT sector'. No
further operating segment financial information is therefore
disclosed.
2.2 Foreign currency translation
(a) Functional and presentation currency
Items included in the financial statements of the Company are
measured in United States Dollars ('US dollars', 'USD' or 'US$'),
which is the Company's functional and presentation currency.
(b) Transactions and balances
Foreign currency transactions are translated into US$ using the
exchange rates prevailing at the dates of the transactions.
Exchange differences arising from the translation at the half year
end exchange rates of monetary assets and liabilities denominated
in foreign currencies are recognised in the statement of
comprehensive income.
Conversation rates, USD
-----------------------------------------------------
Currency Average
rate, for
six months
At 30/06/2014 ended 30/06/2014
----------------- -------------- ------------------
British pounds,
GBP 1.7034 1.6689
----------------- -------------- ------------------
Euro, EUR 1.3644 1.3711
----------------- -------------- ------------------
Israeli shekel 0.2922 0.2878
----------------- -------------- ------------------
3 (Losses)/gains on investments
For the six months ended 30/06/2014 For the six months ended 30/06/2013
USD USD
----------------------------------------- ------------------------------------ -------------------------------------
Gross interest income from convertible
notes receivable 37,473 105,261
----------------------------------------- ------------------------------------ -------------------------------------
Amortized costs of convertible notes
receivable (6,957) (20,044)
----------------------------------------- ------------------------------------ -------------------------------------
Interest accrued - (27,936)
----------------------------------------- ------------------------------------ -------------------------------------
Net interest income from convertible
notes receivable 30,516 57,281
----------------------------------------- ------------------------------------ -------------------------------------
Profit on disposal of convertible notes - 157,191
----------------------------------------- ------------------------------------ -------------------------------------
Loss on disposal of equity investment (230,727) -
----------------------------------------- ------------------------------------ -------------------------------------
Impairment of available-for-sale assets (360,755) (388,000)
----------------------------------------- ------------------------------------ -------------------------------------
Total net (losses)/gains on investments (560,966) (173,528)
----------------------------------------- ------------------------------------ -------------------------------------
4 Administrative expenses
Administrative expenses include the following amounts:
For the six months ended 30/06/2014 For the six months ended 30/06/2013
USD USD
------------------------- ------------------------------------ -------------------------------------
Staff expenses (note 5) 362,171 360,535
Professional fees 90,335 91,148
Rent 86,304 86,304
Other expenses 72,083 53,840
Legal fees 10,811 32,760
Bank and LSE charges 13,015 10,265
Accounting fees 16,284 7,487
Currency exchange loss 1,284 7,433
------------------------- ------------------------------------ -------------------------------------
652,287 649,772
------------------------- ------------------------------------ -------------------------------------
5 Staff expenses
For the six months ended 30/06/2014 For the six months ended 30/06/2013
USD USD
-------------------- ------------------------------------ --------------------------------------
Directors' fees 140,171 132,788
Wages and salaries 222,000 227,747
362,171 360,535
-------------------- ------------------------------------ --------------------------------------
Wages and salaries shown above include salaries and bonuses
relating to the six months ended 30 June. These costs are included
in administrative expenses. In addition to the above, there are
employment expenses for share-based payments of US$94,848 (for the
six months ended 30 June 2013: US$327,749).
On 6 December 2010, Alexander Selegenev, James Mullins, Petr
Lanin and on 6 June 2011, Yuri Mostovoy, entered into letters of
appointment with the Company whereby they agreed to provide
services to the Company in return for fixed fees. The Directors'
fees for six months ended 30 June 2014 and 2013 were as
follows:
For the six months ended 30/06/2014 For the six months ended 30/06/2013
USD USD
--------------------- ------------------------------------ ------------------------------------
Alexander Selegenev 59,413 54,478
Yuri Mostovoy 50,000 50,000
James Mullins 16,739 15,346
Petr Lanin 14,019 12,964
--------------------- ------------------------------------ ------------------------------------
140,171 132,788
--------------------- ------------------------------------ ------------------------------------
The Directors do not receive any pension contributions or other
benefits other than the share options that have been granted to the
directors that are disclosed in note 13.
6 Net finance income
For the six months ended 30/06/2014 For the six months ended 30/06/2013
USD USD
Interest on bank account 115 -
Interest income 6,872 35,999
6,987 35,999
-------------------------- ------------------------------------ ------------------------------------
7 Loss per share
The calculation of basic earnings per share is based upon the
net loss for six months ended 30 June 2014 attributable to the
ordinary shareholders of US$1,301,114 (for six months ended 30 June
2013: net loss of US$1,115,050) and the weighted average number of
ordinary shares outstanding calculated as follows:
Loss per share For the six months ended 30/06/2014 For the six months ended 30/06/2013
------------------------------------------ ------------------------------------ ------------------------------------
Basic loss per share (cents per share) (5.20) (4.45)
Loss attributable to equity holders of
the entity, USD (1,301,114) (1,115,050)
------------------------------------------ ------------------------------------ ------------------------------------
The weighted average number of ordinary shares outstanding
before and after adjustment for the effects of all dilutive
potential ordinary shares calculated as follows:
(in number of shares weighted during the period For the six months ended 30/06/2014 For the six months
outstanding) ended 30/06/2013
----------------------------------------------------------- ------------------------------------ -------------------
Weighted average number of shares in issue
Ordinary shares 25,004,432 25,040,269
25,004,432 25,040,269
----------------------------------------------------------- ------------------------------------ -------------------
Effect of dilutive potential ordinary shares
Share options 912,444 944,942
----------------------------------------------------------- ------------------------------------ -------------------
Weighted average of shares for the period (fully diluted) 25,916,876 25,985,211
----------------------------------------------------------- ------------------------------------ -------------------
The diluted loss per share for both 2014 and 2013 is the same as
the basic loss per share because the conversion of the share
options decreases the basic loss per share and is therefore
anti-dilutive.
8 Non-current financial assets
At 30 June 2014 At 31 December 2013
USD USD
----------------------------------- ---------------- --------------------
Investments in equity shares (i)
- unlisted shares 28,299,290 26,932,335
Convertible notes receivable (ii)
- promissory notes 2,692,617 2,193,304
----------------------------------- ---------------- --------------------
30,991,907 29,125,639
----------------------------------- ---------------- --------------------
Reconciliation of fair value measurements of non-current
financial assets:
Available-for-sale Total
------------------------------------------------------------ ------------------------- ------------
Unlisted Promissory
shares notes
USD USD USD
------------------------------------------------------------ ----------- ------------ ------------
Balance as at 1 January 2013 15,434,540 3,691,691 19,126,231
Total gains or losses in 2013:
- in profit or loss - (390,683) (390,683)
- in other comprehensive
income 5,932,139 - 5,932,139
Purchases (including consulting & legal fees) 3,582,550 1,830,170 5,412,720
Disposal of investment (carrying value) - (1,047,609) (1,047,609)
Conversion of notes to equity and net gain 1,983,106 (1,890,265) 92,841
------------------------------------------------------------ ----------- ------------ ------------
Balance as at 31 December 2013 26,932,335 2,193,304 29,125,639
------------------------------------------------------------ ----------- ------------ ------------
Total gains or losses for the six months ended 30/06/2014:
- in profit or loss - (6,957) (6,957)
- in other comprehensive
income 1,254,610 - 1,254,610
Purchases (including consulting & legal fees) 703,827 506,270 1,210,097
Disposal of investment (carrying value) (591,482) - (591,482)
Closing balance as at 30 June 2014 28,299,290 2,692,617 30,991,907
------------------------------------------------------------ ----------- ------------ ------------
(i) Breakdown of equity investments for the six months to 30 June 2014:
Invested Date of Value at 1 Additions Capitalized Gain/loss Disposals,
company initial Jan 2014, to equity consulting from changes USD Internal Value at Equity
investment USD investments and legal in fair movements, 30 Jun stake
during the fees, USD value of USD 2014, USD owned
period, USD equity
investments,
USD
--------------- ------------ ----------- ------------ ------------ ------------- ----------- ------------ ----------- --------
Unicell 15/09/2011 2,982,471 - - - - - 2,982,471 10.00%
Depositphotos 26/07/2011 4,997,285 - - - - - 4,997,285 27.75%
RollApp 19/08/2011 550,000 50,000 - - - - 600,000 10.00%
Wanelo 21/11/2011 5,369,400 - - - - - 5,369,400 4.72%
Gild 05/12/2011 170,038 - - 379,307 - - 549,345 1.04%
1-Page 06/02/2012 305,367 - - 204,373 - - 509,740 6.09%
ThusFresh 26/03/2012 510,000 - - - - - 510,000 6.57%
Backblaze 24/07/2012 5,034,439 - - - - - 5,034,439 18.03%
UsingMiles 23/08/2012 260,000 - - - (230,727) (29,273) - -
UM trust 15/07/2014 - - - - - 29,273 29,273 5.89%
Gentoo 17/09/2012 260,000 - - - - - 260,000 6.25%
Favim 24/10/2012 305,050 - - - - - 305,050 20.00%
Appsindep 12/11/2012 1,863,685 - - - - - 1,863,685 19.24%
Virool 29/08/2012 502,275 - - - - - 502,275 1.69%
Adinch 19/02/2013 1,004,000 - - 796,000 - - 1,800,000 20.00%
Tracks Media 24/11/2011 341,350 - - - - - 341,350 6.83%
Wrike 12/06/2012 1,991,150 - - - - - 1,991,150 4.39%
Graphicly 03/04/2013 485,825 - - (125,070) (360,755) - - 8.47%
Drippler 01/05/2014 - 200,000 5,000 - - - 205,000 1.86%
E2C 15/02/2014 - 124,731 10,000 - - - 134,731 6.12%
Oriense 27/01/2014 - 59,096 - - - - 59,096 5.45%
Weaved 13/06/2014 - 250,000 5,000 - - - 255,000 2.69%
Total 26,932,335 683,827 20,000 1,254,610 (591,482) - 28,299,290
----------------------------- ----------- ------------ ------------ ------------- ----------- ------------ ----------- --------
(ii) Breakdown of convertible loan notes for the six months to
30 June 2014:
Investee Date of Value at Additions Capitalized Amortized Profit on Disposals, Value at Terms, Interest
company initial 1 Jan to consulting costs, disposal/ USD 30 Jun years rate,%
investment 2014, convertible and legal USD Impairment 2014, USD
USD note fees, USD charge,
investments USD
during the
period, USD
------------- ------------ ---------- ------------ ------------ ---------- ----------- ----------- ---------- ------- ---------
Ninua 08/06/2011 500,000 - - - - - 500,000 1.5 5.00%
Pipedrive 30/07/2012 777,266 - - (1,472) - - 775,794 2 2.00%
Sharethis 26/03/2013 571,723 - - (198) - - 571,525 5 1.09%
Gentoo 21/05/2014 - 100,000 685 (38) - - 100,647 2 0.28%
KitApps 10/07/2013 202,616 200,000 585 (2,578) - - 400,623 2 2.00%
VitalFields 20/12/2013 141,699 - - (2,479) - - 139,220 1 15.00%
Whale path 02/06/2014 - 200,000 5,000 (192) - - 204,808 2 5.00%
Total 2,193,304 500,000 6,270 (6,957) - - 2,692,617 - -
--------------------------- ---------- ------------ ------------ ---------- ----------- ----------- ---------- ------- ---------
Available-for-sale investments are carried at fair values. Where
financial assets do not have a quoted market price in an active
market and their fair values cannot be reliably measured they are
measured at cost less any identified impairment losses at the end
of reporting period, in accordance with IAS 39 para 46 (c)
exemption.
Where there has been a relevant transaction during the year that
gives an indication of the fair value of the unlisted shares, the
shares are included at that fair value and the increase or decrease
in fair value is recognised in the fair value reserve.
The "price of recent investment" methodology is used mainly for
investments in venture capital companies and includes cost of
investment or valuation by reference to a subsequent financing
round. Valuation increases above cost are only recognised if that
round involved a new external investor and the company is meeting
milestones set by investor.
9 Trade and other receivables
At 30 June 2014 At 31 December 2013
USD USD
----------------------------------------- ---------------- --------------------
Prepayments 9,644 9,767
Interest receivable on promissory notes 105,624 68,151
Interest receivable on deposit 396 1,614
115,664 79,532
----------------------------------------- ---------------- --------------------
10 Cash and cash equivalents
The cash and cash equivalents as at 30 June 2014 include cash on
hand and in banks, deposits, net of outstanding bank overdrafts.
The effective interest rate at 30 June 2014 was 0.87%.
Cash and cash equivalents at the end of the reporting period as
shown in the statement of cash flows can be reconciled to the
related items in the statement of financial position as
follows:
At 30 June 2014 At 31 December 2013
USD USD
--------------- ---------------- --------------------
Deposits 500,000 1,500,000
Bank balances 2,622,289 1,742,269
--------------- ---------------- --------------------
3,122,289 3,242,269
--------------- ---------------- --------------------
The following table represents an analysis of cash and
equivalents by rating agency designation based on Fitch rating or
their equivalent as at 30 June
At 30 June 2014 At 31 December 2013
USD USD
--------------- ---------------- --------------------
Bank balances
A rating 2,622,289 1,742,269
--------------- ---------------- --------------------
2,622,289 1,742,269
--------------- ---------------- --------------------
Deposits
BBB- rating 500,000 1,500,000
--------------- ---------------- --------------------
500,000 1,500,000
--------------- ---------------- --------------------
11 Trade and other payables
At 30 June 2014 At 31 December 2013
USD USD
----------------------------------------- ---------------- --------------------
Salaries and directors' fees payable 189,091 40,540
Trade payables 27,878 30,682
Other current liabilities (see note 15) 1,050,097 44
Accrued expenses 4,684 24,742
----------------------------------------- ---------------- --------------------
1,271,750 96,008
----------------------------------------- ---------------- --------------------
12 Share capital
On 30 June 2014 the Company had an authorised share capital of
unlimited shares of no par value and had issued share capital
of:
As at 30 As at 31
June 2014 December 2013
USD USD
---------------------------- ----------- ---------------
Share capital 27,453,513 26,895,179
Issued capital comprises: Number Number
Fully paid ordinary shares 25,386,062 24,977,728
---------------------------- ----------- ---------------
Number of shares Share
capital
USD
----------------------------- ----------------- -----------
Balance at 31 December 2013 24,977,728 26,895,179
Issue of shares 408,334 558,334
Balance at 30 June 2014 25,386,062 27,453,513
----------------------------- ----------------- -----------
13 Share-based payments
For the six months ended 30/06/14 For the six months ended 30/06/13
USD USD
-------------------------------------- ---------------------------------- ----------------------------------
Share option (compensation expenses) 94,848 327,749
-------------------------------------- ---------------------------------- ----------------------------------
Total share-based payment charge 94,848 327,749
-------------------------------------- ---------------------------------- ----------------------------------
On 27 April 2011, on the recommendation of the independent
directors, the Company granted share options to subscribe for up to
100,000 ordinary shares to Mr. Alexander Selegenev, an executive
director of the Company.
The terms and conditions of the options granted are as
follows:
Options granted to Alexander Selegenev
----------------------- ---------------------------------------
Date granted 1 January 2011
Number of instruments 100,000
Option life, years 1-3
Exercise price US$1.00
Options granted to Mr. Alexander Selegenev vest as follows:
No. of ordinary shares Exercise Price Exercise Period
----------------------- --------------- -------------------
33,333 US$1 31/12/11-30/01/12*
33,333 US$1 31/12/12-30/01/13*
33,334 US$1 31/12/13-30/01/14*
----------------------- --------------- -------------------
* or a period of 30 days starting from the date on which certain
circumstances preventing exercise during these periods have
ended.
These options are exercisable by Mr. Alexander Selegenev only
while he remains a director and will lapse on the termination of
his appointment.
33,334 options that vested to Mr. Selegenev in the year ended 31
December 2013 were exercised. The exercise price was US$1.00 per
ordinary share in accordance with the conditions of the option
agreement. The share price on the date of exercise was USD1.81.
All options granted under the above agreement have now lapsed or
been exercised.
On 24 October 2012, the Company's Board of Directors approved a
share option plan (the "Plan") for directors, officers, employees
of or consultants to the Company and/or any company directly or
indirectly controlled by the Company.
Under the Plan, options for a total of 7,500,000 ordinary shares
in the Company, representing approximately 30% of the then issued
share capital (or 23% of the enlarged share capital at the time,
assuming full exercise of the options), can be made available at an
exercise price determined by the Board or its remuneration
committee, which will not be less than the closing middle market
price for the Company's share on AIM on the date of grant as
published by or on behalf of the London Stock Exchange plc. Options
will vest on a daily basis over a period of 3 years whilst the
option holder remains eligible, and vested options can be exercised
on each anniversary of the grant, but if not exercised within 1
year from the allowable date of exercise, will lapse.
The following options, without performance conditions, have been
granted under the Plan on 25 October 2012:
Option
Price Year Option Price Option Price
Name Option Shares 1 Year 2 Year 3
----------------------------- -------------- ------------ ------------- -------------
German Kaplun (Employee) 1,125,000 US$1.40 US$1.55 US$1.70
Alexander Morgulchik
(Employee) 1,125,000 US$1.40 US$1.55 US$1.70
Alexander Selegenev
(Director) 1,125,000 US$1.40 US$1.55 US$1.70
Artyom Inyutin (Employee) 1,125,000 US$1.40 US$1.55 US$1.70
Yuri Mostovoy (Director) 562,500 US$1.40 US$1.55 US$1.70
Alexander Pak (Employee) 300,000 US$1.40 US$1.55 US$1.70
Levan Kavtaradze (Employee) 150,000 US$1.40 US$1.55 US$1.70
TOTAL 5,512,500
----------------------------- -------------- ------------ ------------- -------------
The fair value of services received in return for share options
granted is based on the fair value of share options and warrants
granted, measured using the Black-Scholes formula, using the
following assumptions:
(in USD, except for
number of shares and Option Price Option Price Option Price
percent) Year 1 Year 2 Year 3
-------------------------- ------------- ------------- -------------
Number of share options
granted 1,837,500 1,837,500 1,837,500
Fair value of share
option at date of grant 0.25 0.15 0.09
Share price at date
of grant 1.65 1.65 1.65
Exercise price 1.40 1.55 1.70
Expected volatility,
per cent 9.39% 9.39% 9.39%
Option life, years 0-1 0-2 0-3
Expected dividends,
percent 0 0 0
Risk free interest rate,
percent 0.41% 0.41% 0.41%
-------------------------- ------------- ------------- -------------
Expected volatility is estimated from the Company's share price
performance on AIM.
Number of Weighted average exercise
shares price of share options
-------------------------- ---------- --------------------------
Outstanding shares at 31
December 2013 5,512,500 1.55
-------------------------- ---------- --------------------------
Shares exercised during
the six months ended 30
June 2014 375,000 1.40
-------------------------- ---------- --------------------------
Exercisable shares at 30
June 2014 1,462,500 1.40
-------------------------- ---------- --------------------------
On 20 June 2014, the Company's senior managers German Kaplun,
Alexander Morgulchik and Artyom Inyutin each exercised options over
375,000 (in total 1,125,000) ordinary shares, at the exercise price
of US$1.40 per share. Share price on the date of exercise was
US$1.975 per share.
14 Reserves
Share based payment reserve Fair value reserve Retained losses Total
USD USD USD USD
----------------------------------- ---------------------------- ------------------- ---------------- ------------
Balance as at 1 January 2013 128,183 2,005,228 (1,336,201) 797,210
----------------------------------- ---------------------------- ------------------- ---------------- ------------
Loss for the year - - (1,849,303) (1,849,303)
Gain from changes in fair value - 5,932,139 - 5,932,139
Share based payment charge 576,207 - - 576,207
Transfer on exercise of share
options (8,420) - 8,420 -
Balance as at 31 December 2013 695,970 7,937,367 (3,177,084) 5,456,253
-----------------------------------
Loss for the year - - (1,301,114) (1,301,114)
Gain from changes in fair value - 1,254,610 - 1,254,610
Share based payment charge 94,848 - - 94,848
Transfer on exercise of share
options (102,537) - 102,537 -
----------------------------------- ---------------------------- ------------------- ---------------- ------------
Balance as at 30 June 2014 688,281 9,191,977 (4,375,661) 5,504,597
----------------------------------- ---------------------------- ------------------- ---------------- ------------
15 Related party transactions
In December 2013, Alexander Morgulchik, German Kaplun and Artyom
Inyutin agreed to receive all of their 2014 salaries in TMT shares
on 31 December 2014 rather than monthly in cash. The number of
shares receivable in each case is fixed at a price of US$1.70 per
share.
On 20 June 2014, Alexander Morgulchik, German Kaplun and Artyom
Inyutin each exercised options over 375,000 (in total 1,125,000)
ordinary shares of no par value in the Company, from options
granted in 2012, at the exercise price of US$1.40 per share. As of
30 June 2014, only 375,000 of these shares were issued, while the
remaining 750,000 shares were issued on 8 July 2014. Proceeds of
US$1,050,000 from the exercise of the 750,000 share options for
which shares were not yet issued as of 30 June 2014 are included
within other current liabilities (note 11).
16 Subsequent events
On 11 July 2014, TMT completed an investment in Quote Roller,
Inc. ("QR"). TMT's investment consists of a US$400,000 unsecured
convertible promissory note in QR. QR is behind two business
productivity SaaS products: Quote Roller and PandaDoc. Both
products help improve efficiency and productivity of business
development and sales teams across various industries.
On 21 July 2014, TMT completed an investment in Le Tote, Inc.
("Le Tote"). TMT's investment consists of a US$250,000 unsecured
convertible promissory note in Le Tote. Le Tote is a fashion rental
platform giving women access to unlimited garments and accessories
each month for a fixed price of US$49 per month.
On 22 July 2014, TMT allotted 1,432,431 new ordinary shares of
no par value each in the Company to new and existing investors at a
price of US$1.85 per share, being a discount of 5.6% to the closing
price of TMT shares on 21 July 2014 and rising US$2.65 million.
On 11 August 2014, TMT sold its entire equity stake in The
One-Page Company, Inc. for the total consideration of US$509,740,
representing an internal rate of return of 32%.
On 20 August 2014, TMT completed an additional investment in
Adinch, Inc. As part of the US$3 million equity fundraising, TMT
acquired additional preferred shares in Adinch for an aggregate
consideration of US$600,000. The fundraising was conducted at a
substantially higher equity valuation, which has allowed TMT to
increase the fair value of its original investment in Adinch
(US$1,000,000 invested in February 2013) by 80%, or approx.
US$800,000.
On 25 August 2014, TMT completed an investment in Anews, Inc., a
rapidly growing global news-reading service with a built-in
behavioural advertising network. TMT has acquired preferred shares
in Anews for an aggregate consideration of US$1,000,000.
On 1 September 2014, TMT completed a US$150,000 equity
investment in Twtrland Ltd., a social intelligence platform.
On 2 September 2014, TMT completed a US$225,000 equity
investment in Drupe Mobile Ltd., a mobile interface
application.
On 15 September 2014, TMT completed a EUR100,000 equity
investment in Taxify OÜ, a taxi booking app.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR SEWFAEFLSESU
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