TIDMCRV
RNS Number : 6286P
Craven House Capital PLC
18 February 2021
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS STIPULATED
UNDER THE UK VERSION OF THE MARKET ABUSE REGULATION NO 596/2014
WHICH IS PART OF ENGLISH LAW BY VIRTUE OF THE EUROPEAN (WITHDRAWAL)
ACT 2018, AS AMED. ON PUBLICATION OF THIS ANNOUNCEMENT VIA A
REGULATORY INFORMATION SERVICE, THIS INFORMATION IS CONSIDERED TO
BE IN THE PUBLIC DOMAIN.
Craven House Capital PLC
("Craven House" or the "Company")
Unaudited Interim Report for the period ended 30 November
2020
INVESTMENT MANAGER'S REPORT FOR THE SIX MONTH PERIODED
30 NOVEMBER 2020
Statement by the Investment Manager
Following the restructuring approved by shareholders on 22 May
2020, the Company's investment portfolio is significantly
simplified and comprises minority shareholdings in five
Swedish-managed eCommerce businesses.
The Company's investments are held at fair value in accordance
with the IPEVC guidelines. Given the proximity of the acquisition
date of the shareholdings in the businesses listed below to the
period end, the original acquisition price of "Price of Recent
Investment" has been applied as the valuation methodology.
Investment Value at 30 Nov Value at 31 May
2020 2020
Shares in Garimon Ltd $1,600,000 $1,600,000
Shares in Rosedog Ltd $1,600,000 $1,600,000
Shares in OneBas.com Ltd $1,600,000 $1,600,000
Shares in IZYRadio Ltd $1,600,000 $1,600,000
Shares in YRRO Ltd $1,600,000 $1,600,000
We are confident that the impact of the COVID-19 pandemic has
not impaired the prospects or therefore the valuation of these
businesses since the time of acquisition. Their respective
strategies, which include the online marketing and distribution of
magazines, music and dietary supplements are, in fact, likely to
benefit from the shift in consumer behaviour resulting from the
pandemic. The development of each business remains at an early
stage and we look forward to reporting on material developments
within the portfolio as appropriate.
Transactions after the period end
On 9 December 2020, the Company announced that Black Seas
Property AS ("BSP") entered into a 6 month option agreement to
acquire certain brand names and associated rights from its investee
company YRRO Ltd. Under the terms of the agreement, consideration
payable of NOK 130,000,000 is to be settled by the issuance of new
shares in BSP to the shareholders of YRRO Ltd.
Desmond Holdings Ltd
Investment Manager to Craven House Capital Plc
For further information please contact:
Craven House Capital Plc Tel: 0203 286 8130
Mark Pajak
www.Cravenhousecapital.com
SI Capital Tel: 01483 413500
Broker
Nick Emerson
www.sicapital.co.uk
SPARK Advisory Partners Limited Tel: 0203 368 3550
Nominated Adviser
Matt Davis/James Keeshan
www.Sparkadvisorypartners.com
About Craven House Capital:
The Company's Investing Policy is primarily to invest in or
acquire a portfolio of companies, partnerships, joint ventures,
businesses or other assets participating in the e-Commerce
sector.
CRAVEN HOUSE CAPITAL PLC
STATEMENT OF COMPREHENSIVE INCOME
FOR THE SIX MONTH PERIODED 30 NOVEMBER 2020
Six months ended Year Ended
30 Nov 2020 30 Nov 2019 31 May 2020
(Unaudited) ) (Unaudited) (Audited)
$'000 $'000 $'000
CONTINUING OPERATIONS
Changes in fair value - (6,893) (6,892)
Intercompany loans written
off
- - (7,158)
Investment Manager fee
waived - 1,657 1,446
Other income 2 - - 144
Administrative expenses (119) (440) (727)
OPERATING LOSS (119) (5,676) (13,187)
------------ ------------ ------------
LOSS BEFORE INCOME TAX (119) (5,676) (13,187)
Income tax 3 - - -
------------ ------------ ------------
LOSS FOR THE PERIOD (119) (5,676) (13,187)
============ ============ ============
Earnings per share expressed
In cents per share:
Basic and diluted 6 (3.08) (223.70) (456.52)
3
CRAVEN HOUSE CAPITAL PLC
STATEMENT OF FINANCIAL POSITION
AS AT 30 NOVEMBER 2020
Six months ended Year Ended
30 Nov 2020 30 Nov 2019 31 May 2020
(Unaudited) (Unaudited) (Audited)
$'000 $'000 $'000
ASSETS
NON-CURRENT ASSETS
Investments at fair value
through
profit or loss 4 8,000 20,476 8,000
--------- --------- --------------
8,000 20,476 8,000
--------- --------- --------------
CURRENT ASSETS
Trade and other receivables 28 951 46
Cash and cash equivalents 3 16 6
--------- --------- --------------
31 967 52
--------- --------- --------------
TOTAL ASSETS 8,031 21,443 8,052
========= ========= ==============
EQUITY
SHAREHOLDERS' EQUITY
Called up share capital 5 3,802 12,759 3,802
Share premium 11,153 25,443 11,153
Accumulated deficit (7,276) (20,342) (7,157)
--------- --------- --------------
TOTAL EQUITY 7,679 17,860 7,798
--------- --------- --------------
LIABILITIES
CURRENT LIABILITIES
Trade and other payables 352 3,083 254
NON-CURRENT LIABILITIES
Loans and borrowings 7 - 500 -
--------- --------- --------------
TOTAL LIABILITIES 352 3,583 254
--------- --------- --------------
TOTAL EQUITY AND LIABILITIES 8,031 21,443 8,052
========= ========= ==============
4
CRAVEN HOUSE CAPITAL PLC
STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTH PERIODED 30 NOVEMBER 2020
Called
up share Share premium Accumulated
capital $'000 deficit Total
$'000 $'000 $'000
Balance at 1 June
2019 12,594 25,128 (14,666) 23,056
Changes in equity
Issue of share capital 165 315 - 480
---------- ---------------- -------------- ----------
Transactions with
owners 12,759 25,443 (14,666) 23,536
---------- ---------------- -------------- ----------
Loss for the period - - (5,676) (5,676)
Balance at 30 November
2019 12,759 25,443 (20,342) 17,860
---------- ---------------- -------------- ----------
Changes in equity
Issue of share capital 1,200 10,710 - 11,910
Cancellation of deferred
shares
Reduction in share
premium (10,157) - 10,157 -
Dividend in specie - (25,000) 25,000 -
- - (14,461) (14,461)
---------- ---------------- -------------- ----------
Transactions with
owners 3,802 11,153 354 15.309
---------- ---------------- -------------- ----------
Loss for the period - - (7,511) (7,511)
Balance at 31 May
2020 3,802 11,153 (7,157) 7,798
---------- ---------------- -------------- ----------
Changes in equity
Issue of share capital - - - -
---------- ---------------- -------------- ----------
Transactions with
owners 3,802 11,153 (7,157) 7,798
---------- ---------------- -------------- ----------
Loss for the period - - (119) (119)
Balance at 30 November
2020 3,802 11,153 (7,276) (7,679)
---------- ---------------- -------------- ----------
CRAVEN HOUSE CAPITAL PLC
STATEMENT OF CASH FLOWS
FOR THE SIX MONTH PERIODED 30 NOVEMBER 2020
Six months ended Year Ended
30 Nov 2020 30 Nov 2019 31 May 2020
(Unaudited) (Unaudited) (Audited)
$'000 $'000 $'000
Cash flows from operating activities
Loss before income tax (119) (5,676) (13,187)
Adjustments for non-cash items
Fair value movement arising on
investments - 6,893 6,892
Intercompany loans written off - - 7,158
Management fee accrual waived - - (1,657)
Costs paid by shares - - 190
Repairs - - 5
Dividend income - - (144)
Decrease/(increase) in trade and
other receivables
Increase/(decrease) in trade and
other payables 18 (18) (3,394)
Decrease in loans and borrowings 98 (1,409) 103
Non-cash issue of ordinary shares - (300) -
- 480 -
------------ ------------ --------------
Net cash used in operating activities
Cash flows from investing activities (3) (30) (4,034)
Dividends received from joint
ventures and associates - - 144
------------ ------------ --------------
Net cash generated by investing
activities - - 144
Cash flows from financing activities
Proceeds from issue of shares - - 3,900
Repayment of loan - - (50)
------------ ------------ --------------
Net cash from financing activities - - 3,850
Net decrease in cash and cash
equivalents (3) (30) (40)
Cash and cash equivalents at the
beginning
of the period 6 46 46
Cash and cash equivalents at the
end of the period 3 16 6
============ ============ ==============
6
CRAVEN HOUSE CAPITAL PLC
NOTES TO THE FINANCIAL INFORMATION
FOR THE SIX MONTH PERIODED 30 NOVEMBER 2020
1. ACCOUNTING POLICIES
General Information
Craven House Capital Plc is a company incorporated in the United
Kingdom under the Companies Act 2006. The address of the registered
office is given on the company information page. The Company is
listed on the AIM Market of the London Stock Exchange (ticker:
CRV).
The next annual financial statements of Craven House Capital Plc
will be prepared in accordance with applicable International
Financial Reporting Standards (IFRS) as adopted for use by the
European Union. Accordingly, the interim financial information in
this report has been prepared using accounting policies consistent
with IFRS. IFRS are subject to amendment and interpretation by the
International Accounting Standards Board (IASB) and the
International Financial Reporting Interpretations Committee (IFRIC)
and there is an on-going process of review and endorsement by the
European Commission. The financial information has been prepared on
the basis of the IFRS that the directors expect to be applicable as
at 31 May 2020.
The financial information has been prepared under the historical
cost convention, except to the extent varied for fair value
adjustments required by accounting standards, and in accordance
with applicable International Financial Reporting Standards (IFRS)
as adopted for use by the European Union. The principal accounting
policies have been applied to all periods presented.
This financial information is unaudited and does not constitute
statutory financial statements within the meaning of Section 434 of
the Companies Act 2006. The financial statements of the Company for
the year ended 31 May 2020, which were prepared in accordance with
IFRS as adopted for use by the European Union, have been reported
on by the Company's auditors and delivered to the Registrar of
Companies. The report of the auditors was unqualified and did not
include any statement under Section 498 of the Companies Act
2006.
This financial information is presented in United States dollar,
rounded to the nearest $'000.
The directors do not propose the issuance of a dividend.
The interim financial information for the six months ended 30
November 2020 was approved by the directors on 18th February
2021.
Going concern
The directors consider that the Company is well placed to manage
its business risks successfully and have a reasonable expectation
that the Company has adequate resources to continue in operational
existence for the foreseeable future. Thus, they continue to adopt
the going concern basis of accounting in preparing the financial
information.
7
CRAVEN HOUSE CAPITAL PLC
NOTES TO THE FINANCIAL INFORMATION - continued
FOR THE SIX MONTH PERIODED 30 NOVEMBER 2020
2. Other operating income
Six months ended Year Ended
30 Nov 2020 30 Nov 2019 31 May
2020
(Unaudited) (Unaudited) (Audited)
$'000 $'000 $'000
Dividends received - - 144
- - 144
------------------- ------------------ ----------
3. Taxation
No tax charges arose in the period or in comparative periods as
a result of losses incurred.
4. Investments at fair value through profit or loss
Unquoted
equity investments
$'000 Total
$'000
As at 1 June 2020 and 30 November
2020 8,000 8,000
-------------------- --------
As part of a group reconstruction in May 2020, the Company's
beneficial ownership of its historic portfolio was transferred to
Ordinary Shareholders via a dividend in specie of shares in its
wholly owned subsidiary, Craven Industrial Holdings Plc.
The value of Investments therefore represents the Company's
acquisitions on 13 March 2020 of a 29.9% interest, at consideration
of $1.6m each, in the below-named five UK entities. These are all
unquoted investments and have therefore been measured on a Level 3
basis as no observable market data is available. Further
information on each investment holding is as follows;
Shares in Garimon Ltd are valued at $1,600,000 representing a
29.9% holding. This shareholding has been valued on a Price of
Recent Investment basis which the directors consider represents the
best indication of the fair value at the year end. Garimon is the
owner of "Magazinos.com", the world's largest-by-content on-line
media magazine and periodical content provision service. The
management of Magazinos are currently evaluating options available
to broaden Magazinos' shareholder base by means of IPO and/or
partnering with a major industry investor.
Shares in Onebas.com Ltd are valued at $1,600,000 representing a
29.9% holding. This shareholding has been valued on a Price of
Recent Investment basis which the directors consider represents the
best indication of the fair value at the year end. On ebas.com Ltd
is the owner of "ONEBas.com Music", an optimised search engine
providing a portal to music content freely circulating online.
8
CRAVEN HOUSE CAPITAL PLC
NOTES TO THE FINANCIAL INFORMATION - continued
FOR THE SIX MONTH PERIOD ENDED 30 NOVEMBER 2020
4. Investments at fair value through profit or loss (continued)
Shares in IZYRadio Ltd are valued at $1,600,000 representing a 29.9%
holding. This shareholding has been valued on a Price of Recent
Investment basis which the directors consider represents the best
indication of the fair value at the year end. IZYRadio Ltd is a
UK/Swedish-based B2B and B2C venture which aims to offer superior
music quality and music videos to radio stations via software applications.
Shares in Rosedog Ltd are valued at $1,600,000 representing a 29.9%
holding. This shareholding has been valued on a Price of Recent
Investment basis which the directors consider represents the best
indication of the fair value at the year end. Rosedog Ltd is the
owner of Pro Vitos(TM), an online marketer of vitamins and diet
supplements and Omega 3 North Norway(TM), a distributor of branded
diet supplements.
Shares in YRRO Ltd are valued at $1,600,000 representing a 29.9%
holding. This shareholding has been valued on a Price of Recent
Investment basis which the directors consider represents the best
indication of the fair value at the year end. YRRO is the owner
of Ocean Skin Labs(TM), a distributor of branded collagen supplements
and Norwegian Fish Oil(TM), a distributor of branded diet supplements.
The businesses of all of the above portfolio investments are presently
loss-making although their cost bases are low and there is minimal
committed future expenditure, meaning that the extent and timing
of the Company's further investment in the businesses are highly
controllable. The Company and the incumbent management teams of
the investee companies will continue to work together with the aim
that these businesses become financially self-sustaining and generating
surpluses within the short- to medium-term and to crystallise additional
capital value for shareholders through strategic, third-party partnerships
.
5. Called up share capital
Authorised, issued and fully paid share capital as at 30 November
2020 is as follows: Number Class: Nominal 30 Nov 31 May
Value 2020 2020
(Unaudited) (Audited)
$'000 $'000
3,863,590 Ordinary $1.00 3,802 3,802
3,802 3,802
------------ ------------
The aggregate nominal values of the ordinary shares include exchange
differences arising from the translation of shares at historic rates
and the translation at the rate prevailing at the date of the change
in functional currency.
During the year ended 31 May 2018, the Company extended the time
scale of 78,632 fully transferable exercisable warrants which were
originally issued in the year ended 31 May 2012. At the date of
issue, the warrants could be exercised on or before 30 June 2014,
this period has now been extended to 30 June 2020. The warrants
are exercisable at a price of $15.00 per share.
9
CRAVEN HOUSE CAPITAL PLC
NOTES TO THE FINANCIAL INFORMATION - continued
FOR THE SIX MONTH PERIOD ENDED 30 NOVEMBER 2020
6. Earnings per share
The calculation of basic earnings per share is based on the loss
attributable to the equity holders of $119,000 divided by the
weighted average number of shares in issue during the period of
3,863,590 (six months ended 30 November 2019: loss of $5,676,000
and 2,537,354 shares; year ended 31 May 2020: loss of $13,187,000
and 2,888,529 shares).
Diluted earnings per share has not been disclosed as the
inclusion of the unexercised warrants described in note 5 would be
non-dilutive.
7. Convertible loan note
As part of the group reconstruction in May 2020, $500,000 of the
convertible loan note which was outstanding at 30 November 2019 was
assigned to the Company's wholly owned subsidiary, Craven
Industrial Holdings Plc.
8. Related party disclosures
Craven Industrial Holdings Plc
During the period, now commonly owned, former subsidiary Craven
Industrial Holdings Plc paid costs on behalf of and advanced loans
to the Company. At the period end, the outstanding balance due to
Craven Industrial Holdings Plc was $204,241.
9. Events after the reporting period
On 9 December 2020, the Company announced that Black Seas
Property AS ("BSP") entered into a 6 month option agreement to
acquire certain brand names and associated rights from its investee
company YRRO Ltd. Under the terms of the agreement, consideration
payable of NOK 130,000,000 is to be settled by the issuance of new
shares in BSP to the shareholders of YRRO Ltd.
10
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