TIDMEQLS
RNS Number : 0823M
Equals Group PLC
12 September 2023
12 September 2023
Equals Group plc
('Equals' or the 'Group')
Interim Results
'Significant revenue growth, record Adjusted EBITDA and strong
balance sheet'
Equals (AIM: EQLS), the fintech payments group focused on the
Enterprise and SME marketplaces, announces its interim results for
the six months ended 30 June 2023 (the 'period' or 'H1-2023') and
an update on trading for 49 trading days for the period from 1 July
2023 to 8 September 2023 ('Q3-2023').
H1-2023: Financial Summary
H1-2023 H1-2022 Change
GBP millions GBP millions % (**)
Underlying transaction values 5,964 4,169 +43%
Revenue 45.0 31.4 +43%
Gross profit 23.6 14.9 +59%
Gross profit % 52.4% 47.4%
Adjusted EBITDA* 9.8 4.9 +102%
Operating profit 5.5 1.1
Profit after taxation 4.8 0.8
EPS (Basic, in pence) 2.64 0.38
Notes
* Adjusted EBITDA is defined as operating profit before:
depreciation, amortisation, impairment charges and share option
charges and items of an exceptional nature. EBITDA is defined as
operating profit before depreciation and amortisation.
**Percentages are calculated based on underlying rather than
rounded figures.
H1-2023: Financial Highlights
-- Record transaction values, with revenues up 43% to GBP45.0
million (H1-2022: GBP31.4 million) including GBP13.6 million
derived from the Solutions platform (H1-2022: GBP6.3 million)
-- Further improvements to gross profit margin, increasing to
52.4% from 47.4%
-- Adjusted EBITDA* more than doubled to GBP9.8 million compared
to same period last year (H1-2022: GBP4.9 million)
-- GBP17.9 million Cash at Bank up from GBP15.0 million at 31
December 2022 despite GBP2.9 million spent on acquisitions
-- Basic EPS rising to 2.64 pence from 0.38 pence in H1-2022
H1-2023: Operational and Product Highlights
-- Acquisition of Oonex, now called Equals Money Europe, providing
EU market access
-- Acquisition of Roqqett, an open banking platform, completed
and now integrated
-- Automation of 'payments out' flows yielding increased efficiencies
-- Further investments into Compliance and Risk functions
-- API integration to Equals Platform deployed, opening new distribution
channels
Q3-2023 Trading (1 July 2023 to 8 September 2023) and
Outlook
-- Year-to-date revenue of GBP63.6 million, 39% ahead of the
same period in 2022
-- Revenues per day of GBP370k, compared to GBP265k in the same
period in 2022
-- Robust pipeline in Solutions underpinning further growth
-- FairFX B2C card product moved to Equals Core platform
-- Equals Money Europe integration progressing on plan
-- Continued strong cash generation
-- Proposed capital reduction being announced today to put the
Company in a position to pay dividends
-- The Board intends to pay a maiden dividend of 1.5 pence in
respect of the financial year ending 31 December 2023*
* Dividend payment subject to, inter alia, capital reduction,
shareholder and court approvals.
Commenting on the Interim Results, Ian Strafford-Taylor, CEO of
Equals Group plc, said:
"This is an outstanding set of results with record revenues
combining with improved gross profit retention to yield enhanced
profitability. These results, coupled with our continued cash
generation, enable us to announce our intention, conditional, inter
alia, upon the completion of the proposed capital reduction, to pay
our maiden dividend of 1.5 pence per share in respect of the
financial year 2023, while continuing our growth strategy. A
further announcement will be made in due course following the
conclusion of the capital reduction process.
"As well as strong financial performance, the Group completed
its acquisition of Oonex SA (subsequently renamed Equals Money
Europe), a Brussels-based payments services provider regulated by
the National Bank of Belgium. This acquisition enables Equals to
widen its distribution and addressable markets and the integration
of the business is proceeding according to plan.
"The first half of 2023 saw strong growth which has continued
into Q3 despite an uncertain macroeconomic environment. Given the
current trading, and a robust sales pipeline, we look to the future
with increased confidence, and we expect to be ahead of
expectations for the full year."
Analyst meeting
A conference call for analysts hosted by Ian Strafford-Taylor
(CEO) and Richard Cooper (CFO) will be held today at 9.30am. A copy
of the Interim Results presentation is available at the Group's
website: http://www.equalsplc.com.
For retail investors, an audio webcast of the conference call
with analysts will be available after 12pm today at:
https://stream.buchanan.uk.com/broadcast/64fb2da384cbf5eec802cac9 .
In addition, as previously announced, the Company will also be
presenting the Interim Results via the Investor Meet Company
platform at 6pm today. Please register at
https://www.investormeetcompany.com/equals-group-plc/register-investor
.
This announcement contains inside information.
- Ends -
For more information, please contact:
Equals Group plc
Ian Strafford-Taylor, CEO Tel: +44 (0) 20 7778
Richard Cooper, CFO 9308
www.equalsplc.com
Canaccord Genuity (Nominated Adviser &
Joint Broker)
Max Hartley / Harry Rees Tel: +44 (0) 20 7523
8150
Peel Hunt LLP (Joint Broker)
Paul Shackleton / John Welch Tel: +44 (0) 20 7418
8900
Buchanan (Financial Communications)
Henry Harrison-Topham / Stephanie Whitmore Tel: +44 (0) 20 7466
/ Toto Berger 5000
equals@buchanan.uk.com www.buchanan.uk.com
Chief Executive Officer's Report
The vision for the Group continues to be the simplification of
global money movement for business customers. Equals achieves this
through its B2B platforms, Equals Money being targeted at SME
customers and Equals Solutions which targets larger corporate
opportunities. The Group's growth potential is particularly strong
given that the core building blocks of its platforms, namely
own-name multi-currency IBANs and bank-grade connectivity and
clearance, are highly complex and time consuming to replicate. This
'first mover' advantage was achieved by the investments made in
previous years and will be continuously enhanced by the
developments planned in the Group's technical roadmap combined with
further investments into direct connectivity to payment
networks.
The ambition of Equals has never just been to operate within the
UK, and we were delighted to complete the acquisition of Oonex SA,
(subsequently renamed Equals Money Europe SA) on 4 July 2023.
Through its regulation by the National Bank of Belgium and strong
links to both a Belgian bank (KBC) and a Dutch bank (ING), this
provides the Group with cross-EU reach for its products,
particularly Equals Solutions, which has already exceeded
management's expectations in terms of revenue growth and
profitability.
In the period we also further enhanced the Group's product set
via the acquisition of Roqqett Limited, an open-banking payments
platform. The acquisition allows Equals to span the entire payment
cycle for its B2B customers by providing them with another method
to get paid by their customers, be that B2B or B2C. Roqqett has now
been successfully integrated into the FairFX card checkout process
and is being sold to external customers.
The investments made by the Group since 2018 have been
instrumental in driving the current strong performance. These
investments fall into two major categories, namely internal product
development and acquisitions. Investment into internal product
development remains vital to driving the business forward and we
anticipate keeping our spend in this area at a consistent level
going forwards. As will be illustrated in more detail in the CFO
Review which follows this Report, our investments into acquisitions
have all been successfully integrated and highly accretive.
The attractiveness of Equals' product set is illustrated by the
growing volume of transactions and load values across the Group's
platform:
GBP millions
H1-2021 H2-2021 H1-2022 H2-2022 H1-2023
Transaction value 2,424 *4,011 4,163 5,053 5,964
% growth on half year 25% 65% 4% 21% 18%
*H2-2021 shown here excludes the GBP114 million from the one-off
material trade announced on 28 October 2021.
This translates well to revenues which rose by 43% in H1-2023 to
GBP45.0 million (H1-2022: GBP31.4 million).
Revenue by six-month period, in GBP millions
H1-2021 H2-2021 H1-2022 H2-2022 H1-2023
Medium enterprises 8.1 11.8 10.3 12.1 14.0
Consumer and small
business 6.1 6.7 7.7 9.0 8.5
White-label 2.4 5.4 7.2 7.8 8.9
Large enterprises 0.3 1.8 6.2 9.4 13.6
Material trade - 1.5 - - -
Total 16.9 27.2 31.4 38.3 45.0
-------- -------- -------- -------- --------
Sales & Marketing
The composition of the Group's Sales and Marketing teams has
shifted over recent years reflecting Equals' pivot from a B2C to a
B2B focus. B2B customer acquisition requires strong processes for
lead generation and outbound sales augmented by high conversion
websites and cost-effective digital marketing. Equals has continued
to strengthen its sales capability by recruitment of experienced
professionals capable of consultative selling. In addition, the
Group has hired people with specific sector expertise as well as
rolling out a regional sales model rather than solely basing in
London. In keeping with the same theme of 'face-to-face' sales,
Equals has increased its presence at industry trade shows and has
salespeople consistently travelling to meet customers. The direct
sales efforts are augmented by a sales operations team to ensure
peak efficiency and conversion. Furthermore, given the roll-out of
API connectivity in H1 2023, the Group now has dedicated resources
within its Engineering team to onboard new customers.
Equals has significantly upgraded its approach to digital
marketing with all the Group's websites yielding increases in
conversion and have rolled out new digital marketing collateral for
the Group's multi-currency IBAN products. Equals' recruitment of
top-quality digital marketing professionals has transformed our
capabilities across the website, SEO and PPC yielding improvements
in customer acquisition and ability to optimise by channel using
test and refine techniques.
Profitability
A 43% increase in revenues, improvement in gross profit margin,
tight cost control in a tough labour market, combined to result in
adjusted EBITDA doubling from GBP4.9 million in H1-2022 to GBP9.8
million in H1-2023. A performance that as CEO, I am immensely proud
of.
Dividend
Equals has today announced a proposed capital reduction to
redeem around GBP25 million of its share premium account to create
distributable reserves. The proposed capital reduction is expected
to be completed by mid Q4-2023. The Board intends conditional,
inter alia, upon the completion of the proposed capital reduction,
to pay a maiden dividend of 1.5 pence per share in respect of the
financial year 2023. A further announcement will be made in due
course following the conclusion of the capital reduction
process.
Current trading and outlook
The Global macroeconomic environment continues to be challenging
with high inflation, high interest rates, concerns over China's
economy and the conflict in Ukraine all affecting confidence and
business activity. Against this market backdrop, Equals continues
to grow strongly because it has a product and capability suite that
is hard to replicate.
In Q3 2023 to date, revenues continued to perform strongly
reaching GBP63.6 million on a year-to-date basis as of 8 September
2023. This is 39% ahead of the same period in 2022 and represents
revenues per working day of GBP370k compared to GBP265k per day in
the prior year.
Equals has increased its addressable market by adding the
capability for customers to connect via API. Whilst these customers
take longer to on-board, due to the requirement to connect their
systems directly to Equals Core, they are typically larger in size,
and we expect to drive future revenue growth. The current pipeline
for new Solutions customers, both via direct login and API, is
strong and with the new capabilities of Equals Money Europe, the
Board believes that going forwards Equals is well positioned to
further increase its addressable markets and distribution
channels.
Given the strong current trading, and a robust sales pipeline,
the Board looks to the future with increased confidence, and we
expect to be ahead of expectations for the full year.
Ian Strafford-Taylor
Chief Executive Officer
12 September 2023
REVIEW OF THE CFO
Taking the financial information disclosed in the CEO's Report
one step further, I am pleased to present record Interim Results
for the six months ended 30 June 2023.
Totals may not sum due to rounding. Percentages are calculating
on underlying figures before rounding. Where costs cannot be
accurately attributed to each segment, they have been allocated on
the basis of revenue.
TABLE 1: INCOME AND EXPENSE ACCOUNT
H1-2023 H1-2022 H2-2022
GBP millions GBP millions GBP millions
------------- ------------- -------------
Revenue (table 3) 45.0 31.4 38.3
------------- ------------- -------------
Gross Profits (table 5) 23.6 14.9 18.8
Less: Marketing (1.2) (0.9) (0.9)
------------- ------------- -------------
Contribution 22.4 13.9 17.9
Staff costs (9.2) (6.6) (7.8)
Property and office cost (0.5) (0.4) (0.5)
IT and telephone costs (1.4) (0.9) (1.1)
Professional Fees (0.7) (0.6) (0.7)
Compliance Fees (0.6) (0.4) (0.3)
Travel and other expenses (0.3) (0.2) (0.3)
-------------
Adjusted EBITDA 9.8 4.9 7.2
------------- ------------- -------------
Less: Share option expense (0.7) (0.3) (0.6)
Less: Acquisition costs and exceptional
items 0.0 0.0 (0.2)
------------- ------------- -------------
EBITDA 9.1 4.6 6.4
------------- ------------- -------------
IFRS 16 Depreciation (table 6) (0.3) (0.4) (0.4)
Other depreciation (table 6) (0.2) (0.2) (0.2)
Amortisation of acquired intangibles
(table 7) (0.7) (0.6) (0.6)
Other amortisation (table 7) (2.5) (2.2) (2.2)
Contingent consideration credit
/ (cost) 0.2 0.0 (0.3)
-------------
(3.5) (3.5) (3.7)
------------- ------------- -------------
Gain on disposal of Travel Cash
CGU 0.4 0.0 0.0
------------- ------------- -------------
EBIT 5.9 1.1 2.7
Lease interest (0.1) (0.1) (0.1)
Foreign exchange differences 0.0 0.0 (0.1)
Contingent consideration finance
charges 0.0 (0.1) 0.0
-------------
(0.1) (0.2) (0.2)
------------- ------------- -------------
PROFIT BEFORE TAXATION 5.8 0.9 2.6
Corporate and deferred taxation (1.0) (0.1) 0.2
------------- ------------- -------------
PROFIT FOR THE YEAR 4.8 0.8 2.8
============= ============= -------------
TABLE 2 - ADJUSTED EBITDA BRIDGE FROM H1-2022 TO H1-2023 (in
GBP'000s)
H1-2022 Adjusted
EBITDA 4,852
Add: 61% uplift in contribution H1-2023 8,477
39% increase in staff costs, reflecting
higher planned headcount (23% up from
H1-2022), higher quality hires and
Less: salary increases (around 8%) (2,574)
47% increase in IT and communication
costs - mainly hosting and telephone
in line with transaction growth (432)
35% increase in professional and compliance
costs for enhanced procedures and
consultation, proactively ahead of
requirements (325)
20% increase in property costs arising
through service charge/utility inflation (87)
48% increase in travel and entertaining
costs incurred through ambassadorial
initiatives and industry awareness
events (86)
H1-2023
Adjusted EBITDA 9,825
========
Uplift over H1-2022 4,973
% uplift over H1-2022 102%
--------
Revenue
TABLE 3 - REVENUE BY CUSTOMER TYPE, IN GBP MILLIONS
The table below shows the revenue for the last five periods of
six months, split by customer grouping and within than the type of
business provided:
H1-2021 H2-2021 H1-2022 H2-2022 H1-2023
International Payments 6.0 8.7 6.9 8.0 9.2
Cards 2.1 3.1 3.4 4.1 4.8
-------- -------- -------- -------- --------
Medium enterprises 8.1 11.8 10.3 12.1 14.0
-------- -------- -------- -------- --------
International Payments 1.4 1.9 2.1 2.4 1.9
Cards 1.7 1.7 2.3 2.8 2.4
Banking 2.9 2.8 2.8 3.3 4.1
-------- -------- -------- -------- --------
Consumer and small business 6.0 6.4 7.2 8.5 8.4
-------- -------- -------- -------- --------
White Label
White-Label 2.4 5.4 7.2 7.8 8.9
Large enterprises ("Solutions") 0.3 1.8 6.2 9.4 13.6
Material trade - 1.5 - - -
Bureau de change 0.1 0.3 0.5 0.5 0.1
Total 16.9 27.2 31.4 38.3 45.0
-------- -------- -------- -------- --------
COST OF SALES & GROSS PROFITS
Cost of sales comprises three principal component which are
shown below. The cost for staff commissions includes Employers
National Insurance contributions.
TABLE 4 - COST OF SALES
H1-2023 H1-2022 H2-2022
GBP millions GBP millions GBP millions
Affiliate commissions 14.6 10.7 13.1
Staff commissions 1.8 1.7 1.9
Transactions costs and similar* 5.0 4.1 4.5
------------- ------------- -------------
Total 21.4 16.5 19.5
------------- ------------- -------------
*Transaction costs, includes bank charges and similar, and,
will, if applicable, include costs for any compensation associated
with the FCA's newly introduced Consumer Duty rules.
Gross profit margins differ between each business unit. The mix
of product (example: spot or forward FX) also influences the
margin. Margins continue to improve as the business mix changes,
and, with increased 'purchasing power' the Group should be able to
improve margins further but probably not higher than a full
percentage point.
Gross profit ratios over the last five six-month periods are
shown below:
Table 5 - GROSS PROFIT MARGIN OVER THE LAST FIVE SIX MONTH
PERIODS
H1-2021 H2-2021 H1-2022 H2-2022 H1-2023
International Payments 64% 54% 59% 51% 57%
Cards 71% 68% 59% 66% 65%
-------- -------- -------- -------- --------
Medium enterprises 66% 58% 58% 56% 59%
-------- -------- -------- -------- --------
International Payments 79% 74% 71% 71% 68%
Cards 71% 71% 61% 64% 58%
Banking 72% 71% 75% 79% 85%
-------- -------- -------- -------- --------
Consumer, and small business 73% 72% 69% 72% 74%
-------- -------- -------- -------- --------
White-Label 17% 11% 11% 13% 19%
Large enterprises (Solutions) 33% 44% 47% 50% 54%
Material trade - 54% - - -
Bureau de change - 67% 40% 40% -
Total 60% 51% 47% 49% 52%
-------- -------- -------- -------- --------
Staff costs
Staff costs shown, exclude staff commissions which are included
in cost of sales (see table 4).
Headcount numbers have moved from 285 as at 31 December 2022 to
323 as at 30 June 2023.
Performance related components, when combined with staff
commissions included in cost of sales are, in the aggregate, around
25% of the total cost of staff.
The charge to the P&L was GBP9.2 million, up 39% on H1-2022
(GBP6.6 million) and 18% on H2-2022 (GBP7.8 million).
Gross of capitalisation of GBP2.4 million (H1-2022: GBP2.1
million), costs were GBP11.7 million in H1-2023 (GBP8.8 million in
H1-2022). The amounts capitalised represent 21% of gross staff
costs, decrease from 23% in H1-2022 largely due to an increased
headcount not directly attributable to development projects.
Capitalisation is now broadly in line with the amortisation
charge relating to capitalised software.
Professional fees and Compliance costs
Owing to an increasing cross-industry compliance burden, the
Group has chosen to report compliance and similar costs separate to
other professional fees. Such costs, including onboarding systems,
have risen due to a combination of greater business activity and
the Group's desire to fast-track business applications proactive
with regulation but not at the expense of quality. Professional
fees have risen in line with trends widely reported in the national
press, most notably the provision for cost of the audit noting
increased acquisition activity and implantation of enhanced
systems.
Depreciation
Tangible fixed assets are depreciated over the anticipated
useful life with a maximum of 60 months (other than leasehold
improvements which is a maximum of 120 months).
TABLE 6 - DEPRECIATION
H1-2023 H1-2022
GBP'000s GBP'000s
IFRS 16 depreciation 332 445
Other depreciation 193 187
--------- ---------
525 632
--------- ---------
Based upon the expenditure incurred to 31 December 2022, the
total depreciation charges for assets in FY-2023 will be:
GBP'000s
IFRS 16 depreciation 668
Other depreciation 375
1,043
---------
Amortisation
Intangible assets acquired on acquisition are amortised over
their estimated useful lives, with a maximum of 60 months for
brands and a maximum of 108 months for customer relationships. The
charge to amortisation for the year can be analysed as follows:
TABLE 7 - COMPONENTS OF AMORTISATION CHARGES
H1-2023 H1-2022
GBP'000s GBP'000s
Amortisation charge arising
from the capitalisation of
internally developed software
in the following years:
2018 and earlier 272 458
2019 831 831
2020 447 447
2021 288 267
2022 377 86
H1-2023 123 -
---------- ----------
2,338 2,089
Amortisation charge for other
intangibles 141 128
---------- ----------
2,479 2,217
Amortisation of acquired intangibles 686 641
---------- ----------
Total amortisation charge 3,165 2,858
---------- ----------
Based upon expenditure to 31 December 2022, the total
amortisation charges for FY-2023 are expected to be:
GBP'000
Internally developed software 4,953
Other intangible assets 267
Acquired intangibles 984
--------
6,204
--------
Operating result
The Group made a profit before taxation of GBP5.8 million in
H1-2023, compared to GBP0.9 million in H1-2022.
Taxation, incorporating R&D credits
The Group has recognised a net tax charge of GBP1,031k (H1-2022:
GBP37k) of which GBPnil (H1-2022: GBP40k) relates to an R&D tax
credit repayment.
At 31 December 2022 the Group had utilisable tax losses of
GBP17.6 million. The White-Label business, Equals Connect Ltd, is
profitable and tax paying, as until 3 October 2022 its profits
could not be offset against other group company losses. At 30 June
2023 it is estimated that the Group has utilisable tax losses of
GBP13.5 million.
TABLE 8 - BALANCE SHEET
This table shows a compressed 'balance sheet' for the Group.
This splits-out (from the statutory disclosure) certain current
assets arising from the acquisitions being made.
30.06.2023 30.06.2022 31.12.2022
GBP'000s GBP'000s GBP'000s
Internally generated software -
cost 28,723 23,617 26,001
Internally generated software -
accumulated amortisation (15,749) (11,065) (13,411)
----------- ----------- -----------
12,974 12,552 12,590
Other non-current assets (other
than 'right to use') 22,965 19,066 18,558
IFRS 16 assets, less IFRS 16 liabilities (635) (976) (830)
35,304 30,642 30,318
----------- ----------- -----------
Liquidity (per Table 11) 16,621 12,825 14,321
Accrued Income and Trade Debtors 5,577 4,245 4,246
R&D rebates - 438 -
Prepayments 1,627 1,411 1,345
Working Capital advances to Roqqett - - 830
Other Sundry Debtors 164 190 189
Inventory of card stock 237 148 292
Accounts payable (2,616) (2,308) (2,070)
Affiliate commissions (3,061) (2,905) (2,563)
PAYE and Vat (849) (652) (816)
Staff commissions and accrued bonuses (1,436) (1,150) (1,690)
Other accruals and other creditors (2,050) (1,442) (1,938)
----------- ----------- -----------
14,214 10,800 12,145
Working Capital and prepaid advances 1,248 - -
to Oonex
Deferred consideration receivable 100 - -
arising from the disposal of the
bureau de change
----------- ----------- -----------
15,562 10,800 12,145
----------- ----------- -----------
Earn-out balances due (Table 9) (4,605) (303) (2,025)
Net corporation and deferred tax 986 1,148 1,639
Net value of forward contracts 827 511 827
----------- ----------- -----------
(2,793) 1,356 441
----------- ----------- -----------
NET SHAREHOLDER FUNDS 48,073 42,798 42,904
----------- ----------- -----------
INVESTMENTS
The Group invests in its future in two principal ways:
a. Product development, which is capitalised and can result in
R&D credits from the UK government.
b. Acquisitions of companies or businesses.
A. Product development
Over the period since January 2018, a total of GBP28.9 million
has been invested in product development of which GBP15.7 million
has already been amortised, more than 54%. In H1-2023 a total of
GBP2.7 million was capitalised of which GBP2.4 million related to
staff costs and GBP0.3 million to third party software.
Until the year ended 31 December 2022, the Group received GBP6.3
million in cash from the UK government in respect of R&D claims
and under IAS 12, this has to be accounted for through the charge
(or credit) to Corporation tax.
For each GBP100,000 of product development capitalised now, the
effect of the UK government's R&D scheme means that at current
rates of corporation tax, the effective P&L cost to the Group
is only GBP78,500.
The amortisation profile of the investments made is shown in
Table 7.
The Group's intellectual property comprises these investments,
and registered trademarks in various jurisdictions.
B. Acquisitions
Table of acquisitions since 1 January 2019
Table 9 below shows the financial position relating to
acquisitions in and after 2019, including Roqqett Limited and Hamer
& Hamer Limited acquired in the six month period ended 30 June
2023.
TABLE 9 - EARNOUTS
Hermex Casco Effective Roqqett Hamer Total
Limited & Hamer
Acquisition date 09.08.2019 19.11.2019 15.10.2020 06.01.2023 24.03.2023
GBP'000s GBP'000s GBP'000s GBP'000s GBP'000s GBP'000s
Acquisition price
booked at acquisition 2,000 2,236 1,575 - - 5,811
Earn outs paid
by 31.12.2020 (2,000) (1,733) (125) - - (3,858)
Revaluation of
asset based on
performance - 793 - - - 793
----------- ----------- ----------- ----------- ----------- ---------
Gross outstanding
at 31.12.2020 - 1,296 1,450 - - 2,746
Paid during 2021 - (741) (368) - - (1,109)
Further change
in consideration - 46 - - - 46
----------- ----------- ----------- ----------- ----------- ---------
Gross Outstanding
at 31.12.2021 - 601 1,082 - - 1,683
Paid during 2022 - (601) (1,082) - - (1,683)
Purchase of the
remainder of the
NCI - 2,955 - - - 2,955
Initial consideration
paid by 31.12.2022 - (930) - - - (930)
----------- ----------- ----------- ----------- ----------- ---------
Gross Outstanding
at 31.12.2022 - 2,025 - - - 2,025
Acquisition price
booked at acquisition - - - 2,250 3,200 5,450
Less acquired gross
liabilities - - - (831) - (831)
Initial Consideration
Paid during H1-2023 - - - (169) (1,500) (1,669)
Deferred Consideration
on receipt of R&D
claim paid during
H1-2023 - - - (215) - (215)
Revaluation of
asset based on
performance - (155) - - - (155)
----------- ----------- ----------- ----------- ----------- ---------
Gross Outstanding
at 30.06.23 - 1,870 - 1,035 1,700 4,605
----------- ----------- ----------- ----------- ----------- ---------
Due in remainder
of 2023 - 1,087 - 1,035 - 2,122
----------- ----------- ----------- ----------- ----------- ---------
Due in or after
2024 - 783 - - 1,700 2,483
----------- ----------- ----------- ----------- ----------- ---------
Total consideration 2,000 5,875 1,575 1,419 3,200 14,069
=========== =========== =========== =========== =========== =========
Roqqett
Following regulatory approval from the FCA on 6 January 2023,
the acquisition of Roqqett Limited, an open-banking platform was
completed on 9 January 2023. Total consideration is up to GBP2.2
million less the gross liabilities of GBP0.8 million totalling
GBP1.4 million. A total of GBP384k had been settled by 30 June
2023. Two instalments with combined liability of just over GBP1
million will be due depending on certain deliverables.
Hamer & Hamer
On 24 March 2023 the Group acquired Hamer & Hamer, an
authorised payment institution regulated by the FCA for an initial
consideration of GBP1.5 million. The business focuses on the SME
segment. The deferred consideration based upon future performance
targets, is GBP1.7 million, giving a total consideration of up to
GBP3.2 million. In the case of super performance, the sellers could
earn a further GBP1.0 million which would be charged to the income
statement.
Oonex SA
On 27 March 2023, the Group announced that it had entered into
an agreement to acquire the entire share capital of Oonex SA, an
authorised payment institution licenced in Belgium. Oonex SA
(subsequently renamed as Equals Money Europe SA) provides card
acquiring services and is a Principal Member of Mastercard allowing
it to issue debit cards across the EEA. Additionally, Oonex SA is a
SWIFT and SEPA member and provides direct Payment Accounts
('IBANs') from Belgium to companies and individuals worldwide.
On 4 July 2023 the National Bank of Belgium consented to this
acquisition. The total consideration agreed was for five million
shares in Equals Group Plc with 3,938,294 issued in July 2023 and
1,061,706 deferred until 4 January 2024. The Group also assumed the
liabilities of Oonex SA and various associated entities for around
EUR6 million. These are expected to be treated as a loan repayable
out of the future profits of Equals Money Europe SA.
C. Disposals
On 14 March 2023, the Group disposed of its Bureau de Change to
an unrelated third party for an initial GBP250,000 with a further
GBP100,000 receivable based upon performance. A gain on disposal of
GBP379,723 has been recognised in these financial statements.
Share capital
The number of shares in issue at 1 January 2023 was 180,712,473.
This increased in the year through the exercise of 333,334 share
options, and 747,488 shares at nominal value were issued pursuant
to the 2022 SIP, thus the number of shares outstanding at 30 June
2023 was 181,793,295. A further 3,938,294 shares were issued and
admitted to trading, pursuant to the acquisition of Oonex SA, thus
at the date of this report the number of shares in issue is
185,731,589.
Share options
At 1 January 2023, the Company had 16,141,058 options
outstanding. 333,334 of these were exercised in 2023, and 36,512
were cancelled. After the 30 June 2023 but before the date of this
announcement, a further 500,000 share options lapsed, thus, at the
date of signing of these financial statements, there were
15,271,212 options, representing 8.2% of the issued share
capital.
The cost of external advice for these schemes amounted to GBP15k
in the period (H1-2022: GBP31k)
Earnings per share
Earnings per share are reported/calculated in accordance with
IAS 33. For non-diluted, the result after tax is divided by the
average number of shares in issue in the year. The average number
of shares in the period was 181,533,904 (H1-2022: 179,890,374).
The calculation of diluted EPS is based on the result after tax
divided by the number of actual shares in issue (above) plus the
number of options where the fair value exceeds the weighted average
share price in the year. The fair value of options is measured
using Black-Scholes and Monte-Carlo. It should be noted that in
accordance with Accounting Standards, this calculation is based on
fair value, not the difference between the market price at the end
of the year or the weighted average price and the exercise price.
The weighted average price was 91 pence (H1-2022: 78 pence), the
number of options exceeding the fair value was 8,089,807 (H1-2022:
6,537,453).
The basic and diluted EPS are shown below:
Basic Basic Diluted Diluted
H1-2023 H1-2022 H1-2023 H1-2022
Profit / (loss) per share
(in pence) 2.64 0.38 2.52 0.36
Adjusted earnings and adjusted EPS
We have observed that the analyst community prepares EPS
calculations on a number of different bases. To try and harmonise
these we have prepared below a basis which hopefully offers
consistency:
H1-2023 H1-2022
GBP'000s GBP'000s
P&L YTD Attributable to owners of Equals Group
PLC 4,788 675
Add back:
* Share option charges 741 290
* Amortisation of acquired intangibles. 686 641
Adjusted earnings 6,215 1,606
========= =========
The resulting earnings per share are shown below:
Basic Basic Diluted Diluted
H1-2023 H1-2022 H1-2023 H1-2022
Adjusted profit per share
(in pence) 3.42 0.89 3.27 0.86
CASH STATEMENT
The movement in the cash position is shown in the table below,
splitting out trading from M&A activities:
TABLE 10 - CASHFLOW H1-2023 H1-2022 H2-2022
GBP'000s GBP'000s GBP'000s
Adjusted EBITDA 9,825 4,852 7,268
Lease payments (principal and interest) (488) (371) (598)
R&D tax receipts relating to qualifying
Equals expenditure in prior periods - - 400
Acquisition costs - - (164)
Internally developed software capitalised
for R&D:
- Staff (2,449) (2,051) (2,140)
- IT Costs (273) (164) (244)
Purchase of other intangible assets
less disposals (284) (307) (138)
Purchase of other non-current assets (252) (122) (149)
Movement in working capital (551) 2,926 (1,780)
---------- ---------- ----------
5,528 4,763 2,455
---------- ---------- ----------
M&A activities:
- Net acquired consideration, and
earn-outs (1,669) (1,380) (1,233)
- Associated costs capitalised in (29) - -
acquisition
Costs relating to acquisitions after (319) - -
the balance sheet date
Loans in advance of acquisition:
- Oonex (729) - -
- Roqqett - - (830)
---------- ---------- ----------
(2,746) (1,380) (2,063)
---------- ---------- ----------
Funds from exercise of share options 97 193 -
External funding repaid (CBILS) - (228) (1,800)
NET CASHFLOWS 2,879 3,348 (1,408)
Balance at 1(st) January / 1(st) July 15,044 13,104 16,452
---------- ---------- ----------
Balance at 30(th) June / 31(st) December 17,923 16,452 15,044
---------- ---------- ----------
Cash per share 9.9 pence 9.1 pence 8.3 pence
Working capital movements commonly comprise:
-- Timing differences between accrued and paid affiliate commissions
-- Timing differences between accrued and paid performance related pay
-- Timing difference between accrued expenses and the settlement of subsequent invoices
-- Profit transfers from the Client ledgers
-- Margin calls (or releases) from liquidity providers
The Group enhances its reputation by aiming to pay all suppliers
on the invoice due date.
TABLE 11 - LIQUIDITY H1-2023 H1-2022
GBP'000s GBP'000s
Cash at bank 17,923 16,452
Balances with liquidity providers 2,863 1,499
Pre-funded balances with card provider 759 884
--------- ---------
Gross liquid resources 21,545 18,835
--------- ---------
Customer balances not subject to safeguarding (4,924) (4,210)
CBILS loan - (1,800)
--------- ---------
(4,924) (6,010)
--------- ---------
Net position 16,621 12,825
--------- ---------
The Group has its principal banking and deposit arrangements
with Barclays, NatWest, Citibank and Blackrock. As a member of
RTGS, the Group also holds interest-earning balances with the Bank
of England.
Richard Cooper
Chief Financial Officer
12 September 2023
INTERIM CONSOLIDATED statement OF COMPREHENSIVE INCOME
FOR THE six-month periodED 30 june 2023
Period Year end
end Period end 31
30 June 30 June December
2023 2022 2022
Unaudited Unaudited Audited
Note GBP000 GBP000 GBP000
Revenue on currency transactions 40,983 28,505 63,541
Banking revenue 4,045 2,868 6,141
----------- ----------- ----------
Revenue 2 45,028 31,373 69,682
Direct costs 2 (21,425) (16,507) (36,027)
----------- ----------- ----------
Gross profit 23,603 14,866 33,655
Administrative expenses 3 (14,395) (10,314) (22,576)
Depreciation (525) (632) (1,211)
Amortisation charge (3,165) (2,858) (6,008)
Acquisition costs - - (164)
Total operating expenses (18,085) (13,804) (29,959)
Operating profit 5,518 1,062 3,696
Other income and expenses:
Gain on the sale of the Cash
CGU 9 380 - -
Finance costs 8 (79) (177) (280)
----------- ----------- ----------
Profit before tax 5,819 885 3,416
Tax charge / (credit) 4 (1,031) (37) 135
----------- ----------- ----------
Profit after tax 4,788 848 3,551
=========== =========== ==========
Memo: Profit is attributable
to:
----------- ----------- ----------
Owners of Equals Group Plc 4,788 675 3,237
Non-controlling interest - 173 314
----------- ----------- ----------
Other comprehensive income:
Exchange differences arising - 1 -
on translation of foreign
operations
4,788 849 3,551
=========== =========== ==========
Profit per share
Basic 2.64p 0.38p 1.80p
Diluted 2.52p 0.36p 1.73p
=========== =========== ==========
All income and expenses arise from continuing operations.
INTERIM CONSOLIDATED statement OF FINANCIAL POSITION
FOR THE six-month periodED 30 june 2023
As at 30 As at 30 As at 31
June 2023 June 2022 December
2022
Unaudited Unaudited Audited
Note GBP000 GBP000 GBP000
ASSETS
Non-current assets
Property, plant and equipment 1,215 1,193 1,139
Right of use assets 3,171 4,067 3,367
Intangible assets and goodwill 34,724 30,425 30,008
Deferred tax assets 1,171 1,287 1,831
40,281 36,972 36,345
----------- ----------- ----------
Current assets
Inventories 237 148 292
Trade and other receivables 13,413 8,228 10,274
Current tax assets - 439 -
Derivative financial assets 5,616 2,593 5,616
Cash and cash equivalents 17,923 16,452 15,044
----------- ----------- ----------
37,189 27,860 31,226
----------- ----------- ----------
TOTAL ASSETS 77,470 64,832 67,571
=========== =========== ==========
EQUITY AND LIABILITIES
Equity attributable to equity
holders
Share capital 6 1,818 1,807 1,807
Share premium 6 53,498 53,405 53,405
Share based payment reserve 4,143 2,455 3,231
Other reserves 8,609 8,610 8,609
Retained deficit (19,995) (23,915) (24,148)
----------- ----------- ----------
Equity attributable to owners
of Equals Group Plc 48,073 42,362 42,904
Non-controlling interest - 436 -
----------- ----------- ----------
48,073 42,798 42,904
----------- ----------- ----------
Non-current liabilities
Borrowings 7 - 1,600 -
Right of use (lease) liabilities 3,063 4,224 3,417
3,063 5,824 3,417
----------- ----------- ----------
Current liabilities
Borrowings 7 - 200 -
Trade and other payables 20,617 12,970 15,489
Current tax liabilities 185 139 192
Right of use (lease) liabilities 743 819 780
Derivative financial liabilities 4,789 2,082 4,789
----------- ----------- ----------
26,334 16,210 21,250
----------- ----------- ----------
TOTAL EQUITY AND LIABILITIES 77,470 64,832 67,571
=========== =========== ==========
INTERIM CONSOLIDATEd STATEMENT OF changes in equity
For the SIX-MONTH period ended 30 june 2023
Group Total
attributable
Share to owners
Share Share based Retained Other of Equals Non-controlling
capital premium payment deficit reserves Group Plc interest Total
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
At 1 January
2022 1,793 53,218 1,858 (24,590) 8,609 40,888 263 41,151
Income for the
period
and total
comprehensive
income - - - 675 - 675 173 848
Exchange
differences
arising on
translation
of foreign
operations - - - - 1 1 - 1
Acquisition of - - - - - - - -
the
remaining NCI
Share based
payment
charge - - 259 - - 259 - 259
Movement in
deferred
tax on
share-based
payment charge - - 338 - - 338 - 338
New shares
issued 14 187 - - - 201 - 201
At 30 June 2022 1,807 53,405 2,455 (23,915) 8,610 42,362 436 42,798
Income for the
period
and total
comprehensive
income - - - 2,562 - 2,562 141 2,703
Exchange
differences
arising on
translation
of foreign
operations - - - - (1) (1) - (1)
Acquisition of
the
remaining NCI - - - (2,902) - (2,902) (577) (3,479)
Share based
payment
charge - - 665 - - 665 - 665
Movement in
deferred
tax on
share-based
payment charge - - 218 - - 218 - 218
Share options
exercised
in year - - (107) 107 - - - -
New shares - - - - - - - -
issued
--------- --------- --------- --------- ---------- ---------------- ---------------- --------
At 31 December
2022 1,807 53,405 3,231 (24,148) 8,609 42,904 - 42,904
Income for the
period
and total
comprehensive
income - - - 4,788 - 4,788 - 4,788
Exchange - - - - - - - -
differences
arising on
translation
of foreign
operations
Purchase of
Roqqett
reserves - - - (666) - (666) - (666)
Purchase of
Hamer
& Hamer
reserves - - - 31 - 31 31
Share based
payment
charge - - 726 - - 726 - 726
Movement in
deferred
tax on
share-based
payment charge - - 186 - - 186 - 186
New shares
issued 11 93 - - - 104 - 104
--------- --------- --------- --------- ---------- ---------------- ---------------- --------
At 30 June 2023 1,818 53,498 4,143 (19,995) 8,609 48,073 - 48,073
========= ========= ========= ========= ========== ================ ================ ========
Other reserves comprise:
Merger reserve Arising on reverse acquisition from Group
reorganisation.
Contingent consideration Arising on equity based contingent consideration
reserve on acquisition of subsidiaries.
Foreign currency reserve Arising on translation of foreign operations
INTERIM Consolidated statement of cash flows
FOR THE SIX-MONTH PERIODED 30 JUNE 2023
Six month Six month Six month
period ended period ended period ended
30 June 30 June 31 December
2023 2022 2022
Unaudited Unaudited Audited
GBP000 GBP000 GBP000
Operating Activities
Profit for the period 5,819 885 2,531
Adjustments for:
Depreciation 525 632 579
Amortisation 3,165 2,858 3,150
Share based payment charge 726 259 665
(Increase) in trade and other receivables (3,431) (188) (9,732)
Decrease in net derivative financial
assets / liabilities - - (3,023)
Increase in trade and other payables 5,356 1,561 8,146
Increase in derivative financial
liabilities - - 2,707
Decrease / (increase) in inventories 55 20 (144)
Finance costs 79 177 103
-------------- -------------- --------------
Net cash inflow 12,294 6,204 4,982
Tax receipts - - 400
Tax paid (192) - (61)
-------------- -------------- --------------
Net cash inflow from operating activities 12,102 6,204 5,321
Cash flows from investing activities
Acquisition of property, plant and
equipment (401) (122) (149)
Acquisition of intangibles (3,005) (2,323) (2,733)
Acquisition of subsidiary, net of (5,425) - -
cash acquired
Net cash used in investing activities (8,831) (2,445) (2,882)
Cash flows from financing activities
Principal elements of lease payments (415) (297) (540)
Interest paid on finance lease (73) (82) (87)
Interest paid (8) (33) (14)
Repayment of borrowings - (200) (1,800)
Acquisition of the remaining non-controlling
interest - - (1,405)
Proceeds from issuance of ordinary
shares 104 201 (1)
Net cash used in financing activities (392) (411) (3,847)
Net increase / (decrease) in cash
and cash equivalents 2,879 3,348 (1,408)
Cash and cash equivalents at the
beginning of the period 15,044 13,104 16,452
-------------- -------------- --------------
Cash and cash equivalents at end
of the period 17,923 16,452 15,044
============== ============== ==============
CONSOLIDATED NOTES TO THE INTERIM FINANCIAL STATEMENTS
FOR THE SIX-MONTH PERIODED 30 JUNE 2023
1. Basis of preparation
The principal accounting policies applied in the preparation of
the Group and Interim Consolidated financial statements are set out
below. These policies have been consistently applied to all the
years presented, unless otherwise stated. The financial statements
have been prepared on a historical cost basis with the exception of
derivative financial instruments which are measured at fair value
through profit or loss.
These financial statements are prepared in accordance with
UK-adopted International Accounting Standards in conformity with
the requirements of the Companies Act 2006. The financial
statements are presented in sterling, the Group's presentational
currency.
The unaudited consolidated Interim financial statements have
been prepared in accordance with the AIM rules and consistently
with the basis of preparation and accounting policies set out in
the accounts of the Group for the period ended 31 December 2022.
The information set out herein is abbreviated and does not
constitute statutory accounts within the meaning of Section 434 of
the Companies Act 2006. These interim consolidated financial
statements do not include all disclosures which would be required
in a complete set of financial statements and should be read in
conjunction with the 2022 Annual Report.
The Company is a limited liability company incorporated and
domiciled in England and Wales and whose shares are quoted on AIM,
a market operated by The London Stock Exchange.
a) Critical judgements and estimates
IFRS requires management to make estimates, judgements and
assumptions that affect the application of the Group's accounting
policies and the reported amounts of assets, liabilities, income
and expenses. These estimates are based on the Directors best
knowledge and past experience. The existing critical judgements and
estimates set out in note [3.26] of the Group's annual report for
the year ended 31 December 2022 have been reviewed in preparing
these Interim consolidated financial statements and the Directors
believe they remain relevant.
b) Going concern
The Board continues to closely monitor its performance and
considers a range of risks that could affect the future performance
and position of the Group. The Board considers it has a reasonable
expectation that it has adequate resources to continue to operate
for the foreseeable future and therefore the financial statements
are prepared on a going concern basis.
2. Segmental Analysis
Based on previously identified cash generating units, the
segmental results were as follows:
Unaudited Currency International Solutions Travel Banking Central Total
Cards Payments Cash
6 months ended GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
30 June 2023
Segment revenue 7,205 19,986 13,587 129 4,121 - 45,028
Direct costs (2,650) (11,775) (6,230) (90) (680) - (21,425)
--------- -------------- ---------- ------- -------- --------- ---------
Gross profit 4,555 8,211 7,357 39 3,441 - 23,603
Administrative
expenses - - - - - (14,395) (14,395)
Depreciation - - - - - (525) (525)
Amortisation - - - - - (3,165) (3,165)
Gain on the sale
of the cash CGU - - - 380 - - 380
Finance costs - - - - - (79) (79)
--------- -------------- ---------- ------- -------- --------- ---------
Profit / (loss)
before tax 4,555 8,211 7,357 419 3,441 (18,164) 5,819
========= ============== ========== ======= ======== ========= =========
Current assets - - - - 3,143 34,046 37,189
Non-current assets 5,323 22,035 - - 2,371 10,552 40,281
Total liabilities - - - - (1,904) (27,493) (29,397)
--------- -------------- ---------- ------- -------- --------- ---------
Total net assets 5,323 22,035 - - 3,610 17,105 48,073
========= ============== ========== ======= ======== ========= =========
Unaudited Currency International Solutions Travel Banking Central Total
Cards Payments Cash
6 months ended GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
30 June 2022
Segment revenue 5,645 16,242 6,204 478 2,804 - 31,373
Direct costs (2,059) (10,183) (3,343) (239) (683) - (16,507)
--------- -------------- ---------- ------- -------- --------- ---------
Gross profit 3,586 6,059 2,861 239 2,121 - 14,866
Administrative
expenses - - - - - (10,314) (10,314)
Depreciation - - - - - (632) (632)
Amortisation - - - - - (2,858) (2,858)
Finance costs - - - - - (177) (177)
--------- -------------- ---------- ------- -------- --------- ---------
Profit / (loss)
before tax 3,586 6,059 2,861 239 2,121 (13,981) 885
========= ============== ========== ======= ======== ========= =========
Current assets - - - - 2,634 25,226 27,860
Non-current assets 5,120 18,051 - 178 2,434 11,189 36,972
Total liabilities - - - - (1,952) (20,082) (22,034)
--------- -------------- ---------- ------- -------- --------- ---------
Total net assets 5,120 18,051 - 178 3,116 16,333 42,798
========= ============== ========== ======= ======== ========= =========
Audited Currency International Solutions Travel Banking Central Total
Cards Payments Cash
6 months ended GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
31 December 2022
Segment revenue 6,894 18,115 9,432 531 3,337 - 38,309
Direct costs (2,559) (11,179) (4,746) (314) (722) - (19,520)
--------- -------------- ---------- ------- -------- --------- ---------
Gross profit 4,335 6,936 4,686 217 2,615 - 18,789
Administrative
expenses - - - - - (12,262) (12,262)
Depreciation - - - - - (579) (579)
Amortisation - - - - - (3,150) (3,150)
Acquisition costs - - - - - (164) (164)
Finance costs - - - - - (103) (103)
--------- -------------- ---------- ------- -------- --------- ---------
Profit / (loss)
before tax 4,335 6,936 4,686 217 2,615 (16,258) 2,531
========= ============== ========== ======= ======== ========= =========
Current assets - - - - 2,343 28,883 31,226
Non-current assets 5,341 17,975 - 128 4,372 8,529 36,345
Total liabilities - - - - (2,287) (22,380) (24,667)
--------- -------------- ---------- ------- -------- --------- ---------
Total net assets 5,341 17,975 - 128 4,428 15,032 42,904
========= ============== ========== ======= ======== ========= =========
3. Operating profit
Operating profit is stated after charging the following
operating expenses:
6 months 6 months 12 months ended
ended 30 June ended 30 June 31 December
2023 2022 2022
Unaudited Unaudited Audited
GBP000 GBP000 GBP000
Marketing costs 1,206 790 1,858
Staff costs 9,194 6,620 14,406
Property and office costs 517 430 932
Audit fees 231 180 350
Compliance costs 552 358 683
Other professional fees 460 380 851
IT and telephone cost 1,351 925 2,012
Travel and similar 257 329 440
Foreign exchange loss 30 10 71
Share option charge and other
share option related costs 741 291 970
Contingent consideration (155) - -
Other costs 11 1 3
--------------- --------------- ----------------
Administrative costs 14,395 10,314 22,576
Depreciation of right of use
assets 331 445 822
Depreciation of property, plant
and equipment 194 187 389
Amortisation charge 3,165 2,858 6,008
Acquisition costs - - 164
Total operating expenses 18,085 13,804 29,959
=============== =============== ================
4. Taxation
6 months 6 months 12 months ended
ended ended 30 June 31 December
30 June 2023 2022 2022
Unaudited Unaudited Audited
GBP000 GBP000 GBP000
Current year R&D credit - (40) -
Current year corporation tax
charge 185 78 192
-------------- --------------- ----------------
Current tax credit 185 38 192
-------------- --------------- ----------------
Origination and reversal of
temporary differences 38 (8) (203)
Recognition of previously
unrecognised deductible temporary
differences 808 7 (124)
-------------- --------------- ----------------
Deferred tax credit 846 (1) (327)
-------------- --------------- ----------------
Total tax charge / (credit) 1,031 37 (135)
============== =============== ================
5. Earnings per share
Basic earnings per share is calculated based on the GBP4,788k
profit attributable to owners of Equals Group plc (H1-2022:
GBP675k) divided by the weighted average number of shares of
181,533,904 in the period (H1-2022: 179,768,562), giving a result
of 2.64 pence per share (H1-2022: 0.38 pence per share).
6. Share capital
6 months 6 months 6 months 12 months
ended 30 ended 30 ended 30 ended 31 December
June 2023 June 2023 June 2022 2022
Unaudited Unaudited Unaudited Audited
No. GBP000 GBP000 GBP000
Authorised, issued and
fully paid-up ordinary
shares of GBP0.01 each
As at start of period 180,712,473 1,807 1,793 1,793
Issued during the period
under share options 333,334 3 7 7
Issued during the period
under the SIP 747,488 8 7 7
As at end of period 181,793,295 1,818 1,807 1,807
------------ ----------- ----------- -------------------
On 6 April 2023, Equals Group Plc issued 333,334 ordinary shares
of 1p each, for total consideration of GBP96,667. Of which
GBP93,333 (28p per share) was allocated to the Share Premium
reserve, in order to satisfy the exercise of share options by a
Director of the Group. Those shares have been retained by the
Director. As part of the longer-term incentive plans for members of
staff, on 20 January 2023, 747,488 shares were issued under a Share
Incentive Plan and placed into trust for 188 eligible employees.
The shares will remain in trust until the vesting conditions are
met at the end of the holding period on 20 January 2026.
7. Borrowings
2023 2022
GBP000 GBP000
Loan debenture - 1,800
======= =======
Under the Coronavirus Business Interruption Loan Scheme (CBILS)
to further support working capital, on 23 December 2020, the main
trading subsidiary of the Company, FairFX plc, entered into a
GBP2.0 million loan agreement with the Royal Bank of Scotland
('RBS').
The loan was originally for a six-year period, to mature on
December 2026, at the Bank Base rate + 2.53% and could be repaid
early at any point without penalty, and indeed the outstanding loan
of GBP1.8 million was repaid in full in August 2022.
8. Finance costs
Finance costs comprise: the unwind of discount on the lease
liability under IFRS 16; the unwind of discount on deferred
consideration in respect of business and company acquisitions made
by the Group and other financing interest costs.
9. Sale of the Cash CGU
The Cash CGU together with its property lease, staff and cash
stock was disposed on 14 March 2023 for a total consideration
GBP0.4 million. Of which, GBP0.1 million is a deferred
consideration receivable upon a future negotiation with the
property lease.
10. Post Balance Sheet Events
The Group completed the acquisition of Oonex S.A on 4 July 2023
following unconditional approval on 6 June 2023 from the National
Bank of Belgium. A total of 3,938,294 shares were issued and
admitted to trading, a further 1,061,706 shares subject to adverse
warranty claims should be issued by 4 January 2024. The acquisition
process was initiated on 24 March 2023 when the Share Purchase
Agreement (SPA) was signed.
The Group made payments totalling EUR2.9 million to address
known and initial liabilities on completion. Payments were made by
way of loans to the subsidiary.
Since completion a further EUR0.6 million was injected to settle
pre-acquisition liabilities. The Group expects to loan Oonex SA a
further EUR0.8 million for the period 1 September to 31 December
2023 but declining over time as the remediation project progresses.
On 9 August 2023 the company was renamed from Oonex SA to Equals
Money Europe SA.
- ENDS -
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