TIDMVELA
RNS Number : 5000R
Vela Technologies PLC
22 September 2017
22 September 2017
Vela Technologies plc
("Vela", the "Company" or the "Group")
Final Results for the year ended 31 March 2017
The Board of Vela (AIM: VELA), the investing company focused on
early-stage and pre-IPO disruptive technology investments, is
pleased to announce the Company's results for the year ended 31
March 2017.
The annual report and accounts and notice of annual general
meeting will be posted to shareholders shortly and will be made
available on the Company's website: www.velatechplc.com. The
Company's Annual General Meeting will be held at 10.00 a.m. on 19
October 2017 at the offices of Allenby Capital Limited, 5 St
Helen's Place, London, EC3A 6AB.
For further information, please contact:
Vela Technologies plc
Brent Fitzpatrick, Non-Executive
Chairman Tel: +44 (0) 7802
Antony Laiker, Director 262 443
Allenby Capital Limited
(Nominated Adviser)
Nick Athanas/Katrina Perez/Asha Tel: +44 (0) 20 3328
Chotai 5656
Smaller Company Capital
Limited
(Broker) Tel: +44 (0) 20 3651
Rupert Williams/Jeremy Woodgate 2910
chairman's statement
for the year ended 31 March 2017
It gives me great pleasure to present the annual report and
financial statements for the year ended 31 March 2017.
The period under review produced total comprehensive income of
GBP993k, resulting from significant unrealised gains on our
investment portfolio (year ended 31 March 2016- GBP204k). The
Company also generated realised gains on the sale of investments in
the period amounting to GBP186k. Cash at bank at the year end was
approximately GBP383k which has been added to during the current
financial year following sales of shares in BTL Group Ltd (TSX:
BTL). During the financial year the Company raised GBP400k through
the issue of unsecured loan notes in October 2016 and, in February
2017, the Company completed a 10% Bond issue with UK Bond Network
Limited raising gross GBP550k.
As at 31 March 2017 gross assets were GBP3.85 million (31 March
2016- GBP2.15 million) and investments were valued at GBP3.45
million (31 March 2016- GBP1.98 million). The Board is pleased to
have seen a strong uplift in the valuation of its investment
portfolio in the period under review, resulting from new
investments made and positive revaluations on certain investments
held. Note 8 to the financial statements provides further details
on the valuation of the investment portfolio and additions and
disposals made during the financial year under review.
The Directors have reviewed numerous investments but in the
period under review have only added one new investment to the
portfolio, this being a GBP200k investment into THEVIBE Limited, a
fan-to-fan ticket platform. We have also increased our holdings in
Portr Limited and BTL. Whilst the remainder of the portfolio;
Stream TV, Revolve Performance, Disruptive Tech Limited, The Social
Superstore Limited and Rosslyn Data Technologies plc make progress
we have decided to write off the remaining small balance of our
investment in Advance Laser Imaging Limited. We also sold our
remaining holding in SalvaRx in the period under review.
Shareholders should avail themselves of the Company website for
full information on announcements made by the Company. The website
link is www.velatechplc.com.
Looking forward we continue to manage our existing portfolio and
review potential new investments, although we are finding that the
expectations of business owners as to the valuation of their
business are somewhat inflated relative to the business risk.
strategic report
for the year ended 31 March 2017
Business review
Further details of the investments made and the investee
companies are detailed in the Chairman's statement and note 8 to
the financial statements.
At the period end the Company holds approximately GBP383k of
cash (31 March 2016: GBP200k) and continues to keep administration
costs to a minimum so that the Company has sufficient resources to
cover the Company's ongoing running costs and has maximum funds
that can be dedicated to further investments.
Additional funds were raised during the period through the issue
of bonds and convertible loan notes. These funds have provided the
Company with additional capital in order to acquire additional
investments. Further details regarding the loans issued in the
period are provided in note 11.
The Company's net loss for the year is GBP72k (12 months ended
31 March 2016: GBP351k). However, the overall total comprehensive
income, which also includes the unrealised gains on investments
carried at fair value, was a positive GBP993k (2016: GBP204k).
The valuation of the investment portfolio under accounting rules
and recorded in these financial statements at 31 March 2017 was
GBP3,455k (2016: GBP1,918k), an increase of GBP1,537k on the prior
year. During the year Vela invested GBP602k in disruptive
technology businesses. Further details of these investment
additions are given in note 8. The Company also recorded an
unrealised gain through Other Comprehensive Income on its estimate
of the fair value of the investment portfolio at 31 March 2017.
This gain, of GBP1,127k, included a significant increase in the
estimate of the fair value of the Company's investment in BTL. We
update shareholders regularly on investee company performance
through our website newsfeed, as information becomes available, and
further detailed information can be found here.
The Company has no employees and has a Board of one male
executive Director and one male non-executive Director.
Key performance indicators (KPIs)
Measuring performance is integral to the next phase of our
strategic growth. The Directors have selected KPIs to benchmark to
the Company's progress. The Directors consider investment income,
profit before tax and investment growth as KPIs in measuring
Company performance.
Investment income is detailed in the statement of comprehensive
income.
Management is satisfied with the level of costs and that these
have been maintained to a minimum level and the loss is as expected
for the Company.
Investment growth is detailed above and in note 8.
Principal risks and uncertainties
The preservation of its cash balances and management of the
capital remain key risks for the Company, ensuring that investments
are commensurate with the level of risk.
The Company is committed to maintaining its minimal operational
costs.
Further information about the Company's principal risks are
detailed in note 14, specifically in the currency risk, credit
risk, liquidity risk and capital risk management sections.
Approved by the Board of directors and signed on behalf of the
Board on 21 September 2017.
statement of comprehensive income
for the year ended 31 March 2017
31 March 31 March
2017 2016
Notes GBP'000 GBP'000
-------------------------------------- ------ --------- ---------
Revenue 1 7 9
Administrative expenses
- share-based payments - (23)
- other administrative
expenses (212) (181)
- profit/(loss) on disposal
of available-for-sale
assets 186 (13)
- impairment of available-for-sale
assets (25) (143)
-------------------------------------- ------ --------- ---------
Total administrative expenses (51) (360)
-------------------------------------- ------ --------- ---------
Operating loss 2 (44) (351)
-------------------------------------- ------ --------- ---------
Finance expense 4 (28) -
-------------------------------------- ------ --------- ---------
Loss before tax (72) (351)
Income tax 6 - -
-------------------------------------- ------ --------- ---------
Loss (72) (351)
-------------------------------------- ------ --------- ---------
Other comprehensive income:
Items that will or may be reclassified to
profit or loss:
Fair value movement on
available-for-sale investments 1,127 449
Reclassification of changes
in fair value of available-for-sale
investments to profit
or loss (62) 106
-------------------------------------- ------ --------- ---------
Other comprehensive income
for the year 1,065 555
-------------------------------------- ------ --------- ---------
Total comprehensive income 993 204
-------------------------------------- ------ --------- ---------
Attributable to:
Equity holders of the
Company 993 204
Earnings per share
Basic and diluted loss
per share (pence) 7 (0.01) (0.07)
-------------------------------------- ------ --------- ---------
balance sheet
as at 31 March 2017
31 March 31 March
2017 2016
Notes GBP'000 GBP'000
------------------------------- ------ --------- ---------
Non-current assets
Investments 8 3,455 1,918
Current assets
Trade and other receivables 9 13 36
Cash and cash equivalents 13 383 200
------------------------------- ------ --------- ---------
Total current assets 396 236
------------------------------- ------ --------- ---------
Total assets 3,851 2,154
------------------------------- ------ --------- ---------
Equity and liabilities
Equity
Called up share capital 12 722 722
Share premium account 1,117 1,117
Available-for-sale reserve 1,873 808
Share option reserve 130 130
Retained earnings (873) (801)
------------------------------- ------ --------- ---------
Total equity 2,969 1,976
------------------------------- ------ --------- ---------
Current liabilities
Trade and other payables 10 22 178
Total current liabilities 22 178
------------------------------- ------ --------- ---------
Non current liabilities
Loans and borrowings 11 860 -
------------------------------- ------ --------- ---------
Total non current liabilities 860 -
------------------------------- ------ --------- ---------
Total equity and liabilities 3,851 2,154
------------------------------- ------ --------- ---------
These financial statements were approved by the Board,
authorised for issue and signed on their behalf on 21 September
2017 by:
Nigel Brent Fitzpatrick MBE
Non-Executive Chairman
Company registration number: 03904195
cash flow statement
for the year ended 31 March 2017
31 March 31 March
2017 2016
Notes GBP'000 GBP'000
---------------------------------- ------ --------- ---------
Operating activities
Loss before tax (72) (351)
(Profit)/loss on disposal
of available-for-sale
assets (186) 13
Impairment of available-for-sale
assets 25 143
Share-based charge - 23
Finance expenses 28 -
Decrease/(Increase) in
receivables - (5)
Decrease in payables (5) (2)
Tax charge - -
---------------------------------- ------ --------- ---------
Total cash flow from operating
activities (210) (179)
---------------------------------- ------ --------- ---------
Investing activities
Consideration for disposal
of investment 247 14
Consideration for purchase
of investment (726) (235)
Total cash flow from investing
activities (479) (221)
---------------------------------- ------ --------- ---------
Financing activities
Proceeds from issue of 872 -
loans (net of issue costs)
Proceeds from the issue
of ordinary share capital - 444
Total cash flow from financing
activities 872 444
---------------------------------- ------ --------- ---------
Net increase in cash and
cash equivalents 183 44
Cash and cash equivalents
at start of year 200 156
---------------------------------- ------ --------- ---------
Cash and cash equivalents
at the end of the year 13 383 200
---------------------------------- ------ --------- ---------
Cash and cash equivalents
comprise:
Cash and cash in bank 383 200
---------------------------------- ------ --------- ---------
Cash and cash equivalents
at end of year 13 383 200
---------------------------------- ------ --------- ---------
statement of changes in equity
for the year ended 31 March 2017
Available-for-sale Share
Share Share Retained Option Total
Capital Premium Earnings reserve Reserve Equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------------ -------- -------- ----------- ------------------- -------- --------
Balance at 1 April
2016 722 1,117 (801) 808 130 1,976
Transactions with
owners
Issue of share options - - - - - -
Issue of share capital - - - - - -
------------------------ -------- -------- ----------- ------------------- -------- --------
Transactions with - - - - - -
owners
------------------------ -------- -------- ----------- ------------------- -------- --------
Loss for the year - - (72) - - (72)
Other comprehensive
income - - - 1,065 - 1,065
------------------------ -------- -------- ----------- ------------------- -------- --------
Total comprehensive
income - - (72) 1,065 - 993
------------------------ -------- -------- ----------- ------------------- -------- --------
Balance at 31 March
2017 722 1,117 (873) 1,873 130 2,969
------------------------ -------- -------- ----------- ------------------- -------- --------
Balance at 1 April
2015 459 936 (450) 253 107 1,305
------------------------ -------- -------- ----------- ------------------- -------- --------
Issue of share options - - - - 23 23
Issue of share capital 263 181 - - - 444
------------------------ -------- -------- ----------- ------------------- -------- --------
Transactions with
owners 263 181 - - 23 467
------------------------ -------- -------- ----------- ------------------- -------- --------
Loss for the year - - (351) - - (351)
Other comprehensive
income - - - 555 - 555
Total comprehensive
income - - (351) 555 - 204
------------------------ -------- -------- ----------- ------------------- -------- --------
Balance at 31 March
2016 722 1,117 (801) 808 130 1,976
------------------------ -------- -------- ----------- ------------------- -------- --------
notes to the financial statements
for the year ended 31 March 2017
1 Revenue and segmental information
The Company is an investment Company and as such there is only
one identifiable operating segment, being the holding and support
of investments. Furthermore, the Company operates in a single
geographic segment being the United Kingdom. The results and
balances and cash flows of the segment are as presented in the
primary statements. Revenue received in the period under review
represents the accrued value for interest receivable from loan
notes held in investee company Stream TV Networks.
2 Loss from operations
Loss from operations is stated after charging/(crediting):
31 March 31 March
2017 2016
GBP'000 GBP'000
---------------------------------- --------- ---------
Auditors' remuneration for
auditing of accounts 10 9
Auditors' remuneration for
non-audit services 1 1
Foreign exchange losses/(gains) 4 (4)
(Profit)/Loss on disposal of
available-for-sale assets (186) 13
Impairment of available-for-sale
assets 25 143
---------------------------------- --------- ---------
3 Staff costs
The average number of persons employed by the Company (including
Directors) during the period was as follows:
31 March 31 March
2017 2016
--------------------------------- --------- ---------
Directors and senior management 2 2
Total 2 2
--------------------------------- --------- ---------
The aggregate payroll costs for these persons were as
follows:
31 March 31 March
2017 2016
GBP'000 GBP'000
------------------------------ --------- ---------
Aggregate wages and salaries 95 78
Social security costs - -
Share-based payments - 23
Pensions costs - -
------------------------------ --------- ---------
95 101
------------------------------ --------- ---------
4 Finance expense
31 March 31 March
2017 2016
GBP'000 GBP'000
---------------------- --------- ---------
Loan note interest 18 -
Bond interest 10 -
---------------------- --------- ---------
Total finance expense 28 -
---------------------- --------- ---------
Included in finance expenses is GBP6k in respect of the
amortisation of loan issue costs.
5 Directors and senior management
Directors' remuneration
31 March 2017
-------------------------------------------------
Salary Fees Pension Equity Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
N B Fitzpatrick - 40 - - 40
A Laiker - 55 - - 55
----------------- --------- -------- -------- -------- --------
- 95 - - 95
--------------------------- -------- -------- -------- --------
31 March 2016
-------------------------------------------------
Salary Fees Pension Equity Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
N B Fitzpatrick - 32 - - 32
A Laiker - 46 - - 46
----------------- ---------- -------- -------- -------- --------
- 78 - - 78
---------- -------- -------- -------- --------
Directors' and senior management's interests in shares
The Directors who held office at 31 March 2017 held the
following shares:
31 March 31 March
2017 2016
----------------- ----------- -----------
N B Fitzpatrick 1,500,000 1,500,000
A Laiker 35,191,724 35,191,724
------------------ ----------- -----------
The total share-based payment costs in respect of options
granted are:
31 March 31 March
2017 2016
GBP'000 GBP'000
Directors - 23
----------- ---------- ---------
As at 31 March 2017, the total number of outstanding options
held by the Directors over ordinary shares is 29,124,854,
representing 4.0 per cent of the Company's issued share capital.
Each Director holds 14,562,427 options.
Further details regarding the options issued are provided in
note 15.
6 Tax
31 March 31 March
2017 2016
GBP'000 GBP'000
------------- --------- ---------
Current tax:
UK tax - -
------------- --------- ---------
Tax charge - -
------------- --------- ---------
A deferred tax asset relating to losses carried forward has not
been recognised due to uncertainty over the existence of future
taxable profits against which the losses can be used. The Company
has unused tax losses of approximately GBP4.5m (2016: GBP4.4m). In
addition, a deferred tax liability on the cumulative fair value
gain of GBP1,873k on available-for-sale assets has not been
recognised on the basis that it would be offset by available
taxable losses.
Tax reconciliation
31 March 31 March
2017 2016
GBP'000 GBP'000
------------------------------- --------- ---------
Loss before tax (72) (351)
Tax at 20% (2016: 21%) on
loss before tax (14) (74)
Effects of:
Other expenses not deductible - 7
Utilisation of losses - -
Unrelieved losses carried
forward 14 67
------------------------------- --------- ---------
Total tax (credit)/expense - -
------------------------------- --------- ---------
7 Loss per share
Loss per share has been calculated on a loss after tax of
GBP72,000 (2016: GBP351,000 loss) and the weighted number of
average shares in issue for the year of 721,588,020 (2016:
533,749,896).
The loss and weighted average number of shares used in the
calculations is set out below:
31 March 31 March
2017 2016
------------------------ --------- ---------
Loss (GBP'000) (72) (351)
Loss per share (pence) (0.01) (0.07)
------------------------ --------- ---------
8 Investments
31 March 31 March
2017 2016
GBP'000 GBP'000
-------------------------------------- --------- ---------
Opening balance 1,918 1,147
Additions during the year 602 386
Disposals during the year (163) (17)
Exchange rate differences (4) 3
Gain included in Other Comprehensive
Income 1,127 449
Current year impairment charged
to profit or loss (25) (50)
-------------------------------------- --------- ---------
Closing balance 3,455 1,918
-------------------------------------- --------- ---------
Additions during the year:
Further investment in BTL
On 6 May 2016 the Company subscribed for 41,666 shares and
41,666 warrants in BTL for consideration of CAN$25,000.
On 18 November 2016, the Company acquired a further 41,666
shares in BTL, via the exercise of the 41,666 warrants, for
consideration of CAN$41,666. As at 31 March 2017, taking into
account the disposals below, the Company held 689,800 shares in
BTL, equivalent to 4.0 per cent. of BTL's share capital.
In addition, on 23 March 2017, the Company conditionally
acquired 50,000 shares and 25,000 warrants in BTL for consideration
of CAN$135,000. This transaction has been included within
investment additions in the period, on the basis that the
consideration was paid before 31 March 2017 and the transaction was
substantially complete by 31 March 2017.
Conversion of Stream TV loan note
On 23 June 2016 the Company entered into a conversion notice
agreeing to an early conversion of its $100,000 Stream TV
Convertible Promissory Notes (CPN's), along with accrued interest
of $43,693, into new Class A common shares in Stream TV at a price
of $3.00 per share. The accrued interest includes a bonus of $7,500
as a consequence of early conversion. Following the conversion, the
Company has an interest of 0.14% in the Class A common share
capital of Stream TV.
Investment in THEVIBE Limited
In September 2016 the Company submitted an order to Crowdcube to
invest GBP200,000 in THEVIBE Limited. On 3 October 2016 the
investment became binding and completed in November 2016. Following
completion of the funding round the Company holds 428,346 ordinary
shares in THEVIBE Limited.
Further investment in Portr Limited
On 10 January 2017 the Company invested a further GBP100,000 in
Portr for 9,452 ordinary shares. Following this new investment the
company was interested in 111,441 ordinary shares. A further
GBP150,000 was invested in Portr in February 2017 for a further
14,178 ordinary shares.
Disposals during the year:
Disposal of SalvaRx shares
Between April 2016 and August 2016 the Company disposed of all
of the shares held in SalvaRx for an aggregate consideration of
GBP68,505, net of disposal costs.
Sale of Rosslyn Data Technologies plc shares
In July 2016 and January 2017, the Company disposed of 30,000
shares and 73,368 shares respectively for an aggregate
consideration of GBP8,485 net of transaction costs.
Sale of BTL shares
During March 2017 the Company disposed of 94,232 shares in BTL
for an aggregate consideration of GBP169,530 net of transaction
costs.
Transfer of Portr Limited shares
In February 2017, the Company transferred 3,780 shares in Portr
Limited as consideration for the provision of a personal guarantee,
as detailed in note 11. The Company held 121,839 shares in Portr
Limited as at 31 March 2017.
9 Trade and other receivables
31 March 31 March
2017 2016
GBP'000 GBP'000
-------------------------------- --------- ---------
Other receivables 13 13
Prepayments and accrued income - 23
-------------------------------- --------- ---------
13 36
-------------------------------- --------- ---------
10 Trade and other payables
31 March 31 March
2017 2016
GBP'000 GBP'000
------------------------------ --------- ---------
Trade payables 5 13
Accruals and deferred income 17 165
22 178
------------------------------ --------- ---------
11 Loans and borrowings
Loans due after 1 year 31 March 31 March
2017 2016
GBP'000 GBP'000
----------------------- --------- ---------
Convertible loan notes 408 -
Bonds 452 -
----------------------- --------- ---------
860 -
----------------------- --------- ---------
On 9 September 2016, the Company issued GBP400,000 of
convertible unsecured loan notes to certain Shareholders, including
Antony Laiker (a director of the Company). The loan notes are
repayable on 30 September 2018 and carry an annual interest rate of
8 per cent. The Loan Notes will be convertible into Ordinary Shares
at 0.15p per share, a discount of 6.25 per cent. to the closing bid
price of 0.16p per share on 8 September 2016. The Directors
consider the convertible loan notes to represent a compound
financial instrument. The Directors consider the equity element of
the instrument to be immaterial. Accordingly, the full balance is
classified as a financial liability.
On 1 February 2017, the Company launched the issue of secured
bonds, through UK Bond Network, to raise GBP550,000 for the
Company. The Bonds have a coupon of 10% and a term of 3 years with
full repayment in cash of the principal amount of the Bonds due at
maturity. The Bonds may be repaid at the option of Vela: (i) after
the first anniversary of the issue of the Bond, together with all
accrued (but unpaid) interest on the amount prepaid; or (ii) prior
to the first anniversary of issue, together with the interest that
would have accrued up to the first anniversary had the Bond not
been prepaid. The Bonds will not be convertible into ordinary
shares in the capital of the Company.
The Bonds are secured by way of a fixed charge over the shares
that the Company owns in Portr Limited and a floating charge over
all other assets of the Company present and future.
Further protection for bondholders has been provided through a
personal guarantee being given by Scott Fletcher, an existing
shareholder in the Company and the Chairman of UK Bond Network. As
consideration for the provision of the personal guarantee, Scott
Fletcher received a fee of GBP40,000 from the Company which was
satisfied by the Company transferring 3,780 shares that it
previously held in Portr Limited to Scott Fletcher.
The loan balances above are stated net of debt issue costs and
rolled up interest amounting to GBP90k.
12 Share capital
31 March 31 March
2017 2016
GBP'000 GBP'000
-------------------------------- --------- ---------
Authorised capital
9,999,520,000 ordinary shares
of 0.1 pence each 10,000 10,000
10,000 10,000
-------------------------------- --------- ---------
Allotted, called up and fully
paid capital
721,588,020 ordinary shares of
0.1 pence each 722 722
722 722
-------------------------------- --------- ---------
Allotments during the period
The Company allotted the following ordinary shares during the
year:
31 March 2017
---------------------------- --------------
Shares in issue at 1 April
2016 721,588,020
Shares issued during the -
year
---------------------------- --------------
Shares in issue at 31
March 2017 721,588,020
---------------------------- --------------
31 March 2016
----------------------- --------------
Shares in issue at 1
April 2015 459,088,020
Shares issued during
the period 262,500,000
----------------------- --------------
Shares in issue at 31
March 2016 721,588,020
----------------------- --------------
On 26 September 2016, the Company passed a resolution to
consolidate every 1,500 ordinary shares of 0.1p into one
consolidated ordinary share of 150p ("Consolidated Ordinary
Share"). All fractional shareholdings resulting from the
consolidation were aggregated and sold for the best price
reasonably obtainable. The proceeds were then distributed to the
shareholders, subject to a minimum entitlement of GBP3, with the
balance being retained by the Company.
Each Consolidated Ordinary Share of 150p arising from the
consolidation was subsequently sub-divided into 1,500 ordinary
shares of 0.1p. The retained balance of proceeds received by the
Company amounted to GBP286.
13 Cash and cash equivalents
Cash and cash equivalents comprise the following:
31 March 31 March
2017 2016
GBP'000 GBP'000
------------------------------ --------- ---------
Cash and cash in bank:
Pound sterling 383 200
Cash and cash equivalents at
end of year 383 200
------------------------------ --------- ---------
14 Financial instruments
The Company uses various financial instruments which include
cash and cash equivalents, loans and borrowings and various items
such as trade receivables and trade payables that arise directly
from its operations. The main purpose of these financial
instruments is to raise finance for the Company's operations and
manage its working capital requirements.
The fair values of all financial instruments, other than certain
investments recorded at cost, are considered equal to their book
values. The existence of these financial instruments exposes the
Company to a number of financial risks which are described in more
detail overleaf.
The main risks arising from the Company's financial instruments
are currency risk, credit risk and liquidity risk. The Directors
review and agree the policies for managing each of these risks and
they are summarised below. The Company does not have any borrowings
on which interest is charged at a variable rate. The Directors,
therefore, do not consider the Company to be exposed to material
interest rate risk.
Currency risk
The Company's shareholdings in BTL and Stream TV are denominated
in Canadian Dollars and US Dollars respectively, which gives rise
to exposure to foreign currency risk. The Directors have considered
the risk and do not deem it necessary to enter into any specific
risk management arrangements at the present time. The Directors
will continue to review the position going forward to ensure this
remains appropriate in the context of the Company's risk
profile.
Credit risk
This section along with the liquidity risk and capital risk
management sections below also form part of the strategic
report.
The Company's exposure to credit risk is limited to the carrying
amount of financial assets recognised at the balance sheet date, as
summarised below:
31 March 31 March
2017 2016
Classes of financial assets - GBP'000 GBP'000
carrying amounts
------------------------------------- --------- ---------
Available-for-sale financial
assets measured at fair value
through other comprehensive income
(*) 3,455 1,918
Loans and receivables 13 13
------------------------------------- --------- ---------
3,468 1,931
------------------------------------- --------- ---------
* where a reliable estimate of fair value cannot be determined,
the investment is measured at cost less impairment (see below).
The Company's management considers that all of the above
financial assets that are not impaired for each of the reporting
dates under review are of good credit quality.
The Company's financial assets are secured, as detailed in note
11.
The Company is required to report the category of fair value
measurements used in determining the value of its investments, to
be disclosed by the source of its inputs, using a three-level
hierarchy. There have been no transfers between Levels in the fair
value hierarchy.
Quoted market prices in active markets - "Level 1"
Inputs to Level 1 fair values are quoted prices in active
markets for identical assets. An active market is one in which
transactions occur with sufficient frequency and volume to provide
pricing information on an ongoing basis. The Company has two (2016:
three) investments classified in this category. The aggregate
historic cost of the two investments is GBP299,393 (2016:
GBP355,950 in respect of three investments) and the fair value as
at 31 March 2017 was GBP1,446,713 (2016: GBP343,787).
Valued using models with significant observable market
parameters - "Level 2"
Inputs to Level 2 fair values are inputs other than quoted
prices included within Level 1 that are observable for the asset,
either directly or indirectly. The Company has one (2016: one)
unquoted investment classified in this category. The historic cost
of this investment is GBP586,034 (2016: GBP351,343) and the fair
value as at 31 March 2017 was GBP1,289,058 (2016: GBP1,079,050),
giving rise to a cumulative gain of GBP703,024 credited to the
available-for-sale reserve as at 31 March 2017. The investment was
valued using the transaction price ascribed to the shares following
a placing by the investee Company in March 2017.
Valued using models with significant unobservable market
parameters - "Level 3"
Inputs to Level 3 fair values are unobservable inputs for the
asset. Unobservable inputs may have been used to measure fair value
to the extent that observable inputs are not available, thereby
allowing for situations in which there is little, if any, market
activity for the asset at the measurement date (or market
information for the inputs to any valuation models). As such,
unobservable inputs reflect the assumptions the Company considers
that market participants would use in pricing the asset. The
Company holds 25,000 warrants, with an estimated fair value of
GBP22,750, in relation to shares in one of its investee
companies.
The Company has six (2016: five) investments that are held at
cost less impairment as a reliable estimate of fair value cannot be
determined. An impairment charge of GBP25,000 (2016: GBP50,000) has
been recognised directly in profit or loss in respect of one of
these investments. As at 31 March 2017 the historical cost of these
investments amounted to GBP771,504 (2016: GBP545,413) and their
aggregate carrying value was GBP696,504 (2016: GBP495,413).
Liquidity risk
The Company maintains sufficient cash to meet its liquidity
requirements. Management monitors rolling forecasts of the
Company's liquidity on the basis of expected cash flow in
accordance with practice and limits set by the Company. In
addition, the Company's liquidity management policy involves
projecting cash flows and considering the level of liquid assets
necessary to meet these.
Maturity analysis for financial liabilities
31 March 31 March
2017 2016
------------------ ------------------
Within Later Within Later
than than
1 year 1 year 1 year 1 year
GBP'000 GBP'000 GBP'000 GBP'000
----------------------- -------- -------- -------- --------
At amortised cost:
Financial liabilities
at amortised cost 22 860 178 -
22 860 178 -
----------------------- -------- -------- -------- --------
Capital risk management
The Company's objectives when managing capital are to safeguard
the Company's ability to continue as a going concern in order to
provide returns for shareholders and benefits for other
stakeholders and to maintain an optimal capital structure to reduce
the cost of capital. This is achieved by making investments
commensurate with the level of risk. The Company is performing in
line with the expectations of the Directors.
The Company monitors capital on the basis of the carrying amount
of equity. The Company policy is to set the amount of capital in
proportion to its overall financing structure, i.e. equity and
long-term loans. The Company manages the capital structure and
makes adjustments to it in the light of changes in economic
conditions and the risk characteristics of the underlying assets.
In order to maintain or adjust the capital structure, the Company
may adjust the amount of dividends paid to shareholders, issue new
shares or loan notes, or sell assets to reduce debt.
15 Share-based payments
The Company rewards its Directors using equity settled
share-based payments.
No new share options have been issued in the current accounting
period and the total number of options outstanding at 31 March 2017
was 29,124,854 (2016: 29,124,854). None of the options issued have
either lapsed or been exercised in the period.
The options have historically been valued using the Black
Scholes option pricing model.
The amount of remuneration expense in respect of the share
options granted amounts to GBPNIL (2016: GBP23,000).
Details of the options outstanding at the year end and the
inputs to the option pricing model are as follows:
Options Options Options Options
granted granted granted granted
22 October 18 September 2 October 8 April
2015 2015 2014 2014
----------------------- ----------- ------------- ---------- ----------
Share price at
grant date (pence) 0.21 0.19 0.33 1.50
Exercise price
(pence) 0.21 0.15 0.33 0.85
Expected life (years) 7 7 7 7
Annualised volatility
(%) 79.47 70.98 95.16 74.23
Risk-free interest
rate (%) 2.0 2.0 2.0 2.0
Fair value determined
(pence) 0.15 0.13 0.26 1.17
Number of options
granted 6,400,000 10,489,560 4,000,000 8,235,294
Options exercisable
at 31 March 2017 4,266,667 6,993,040 4,000,000 8,235,294
------------------------ ----------- ------------- ---------- ----------
None of the options outstanding as at 31 March 2017 are subject
to any performance criteria
16 Related party transactions
During the period the Company entered into the following related
party transactions. All transactions were made on an arm's length
basis.
Ocean Park Developments Limited
Nigel Brent Fitzpatrick, Non-Executive Director, is also a
Director of Ocean Park Developments Limited. During the year the
Company paid GBP40,000 (2016: GBP32,000) in respect of his
Directors fees to the Company. The balance due to Ocean Park
Developments Limited at the year end was GBPnil (2016: GBPnil).
Risk Alliance Insurance Brokers Limited
Nigel Brent Fitzpatrick, Non-Executive Director, is also a
Director of Risk Alliance Insurance Brokers Limited. During the
year the Company paid GBP5,756 (2016: GBP5,510) in respect of
insurance fees at arm's length. The balance due to Risk Alliance
Insurance Brokers Limited at the year end was GBPnil (2016:
GBPnil).
Widdington Limited
Antony Laiker, Director, is also a Director of Widdington
Limited. During the year the Company paid GBP55,000 (2016:
GBP46,000) in respect of his Directors fees to the Company. The
balance due to Widdington Limited at the year end was GBPnil (2016:
GBPnil).
During the year Antony Laiker subscribed for GBP200,000 of the
8% loan notes.
Kevin Sinclair
Kevin Sinclair, a shareholder of the Company, subscribed for
GBP100,000 of the new bonds under the Company's 10% bond issue in
February 2017. At 31 March 2017, Kevin Sinclair held 106,449,000
(14.75%) of the issued share capital of the Company through JIM
Nominees Ltd.
Scott Fletcher
Scott Fletcher, a shareholder of the Company, subscribed for
GBP200,000 of the 8% convertible loan notes issued by the company
in September 2016.
Scott Fletcher also issued a personal guarantee relating to the
payment obligations of the Company in respect of the 10% bond issue
to a maximum guaranteed amount of GBP575,000. In consideration of
Scott Fletcher entering into the personal guarantee, the Company
entered into an agreement with him to pay him a fee of GBP40,000.
This fee was satisfied by the Company transferring to him 3,780
ordinary shares in Portr, an investee company. As part of this
agreement the Company has agreed that, until the Bonds have been
repaid in full, the Company shall not increase the balance of its
indebtedness beyond an aggregate amount of GBP950,000 without
having notified Scott Fletcher and receiving his prior written
consent.
Scott Fletcher held 63,944,656 Ordinary Shares at 31 March 2017
representing 8.86 per cent. of the issued share capital of the
Company in addition to the 8% convertible loan notes above. He is
also the chairman of UK Bond Network Limited, which acted on behalf
of the Company in relation to the bond issue.
17 Events after the balance sheet date
Disposal of BTL shares
On 6 April 2017, the Company disposed of 56,700 common shares
held in BTL generating net proceeds of CAN$232,564.
On 19 April 2017, the Company disposed of 20,000 common shares
held in BTL for a consideration of CAN$92,850.
On 30 May 2017, the Company disposed of a further 50,000 common
shares held in BTL for a consideration of CAN$263,106.
Investment in BTL Group Ltd
On 18 April 2017 the Company announced the completion of a
follow-on investment of C$135,000 in BTL Group Ltd.
Investment in Rosslyn Data Technologies plc
On 26 April 2017, the Company announced that it had
conditionally subscribed for 1,111,111 ordinary shares for a
consideration of GBP50,000. Vela is interested in 1,411,111
ordinary shares in Rosslyn Data Technologies representing 0.75% of
the company's issued share capital.
18 Annual report and accounts
The annual report and accounts will be posted to shareholders
shortly, and will be available on the Company's website:
http://www.velatechplc.com/.
19 Annual General Meeting
The Company's Annual General Meeting will be held at 10.00 a.m.
on 19 October 2017 at the offices of Allenby Capital, 5 St Helen's
Place, London, EC3A 6AB. Notice of the Annual General Meeting will
be sent to shareholders with the annual report and accounts.
Extraction of information in this announcement
The financial information, which comprises the statement of
comprehensive income, balance sheet, cashflow statement, statement
of changes in equity, and related notes to the financial
statements, is derived from the full Company financial statements
for the year ended 31 March 2017, which have been prepared under
European Union endorsed International Financial Reporting Standards
(IFRS) and those parts of the Companies Act 2006 applicable to
companies reporting under IFRS. It does not constitute full
financial statements within the meaning of section 434 of the
Companies Act 2006. This financial information has been agreed with
the auditor for release.
The full annual report and financial statements for the year
ended 31 March 2017, on which the auditor has given an unqualified
report and which does not contain a statement under section 498 of
the Companies Act 2006, will be delivered to the Registrar of
Companies in due course.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR LBMRTMBITBBR
(END) Dow Jones Newswires
September 22, 2017 02:00 ET (06:00 GMT)
Vela Technologies (LSE:VELA)
Historical Stock Chart
From Apr 2024 to May 2024
Vela Technologies (LSE:VELA)
Historical Stock Chart
From May 2023 to May 2024