Half-yearly Report
18 December 2013
Vela Technologies PLC
("Vela" or the "Company")
Half-Yearly Report for the six months Ended 30 September 2013
chairman's statement
It is with pleasure that I present the half yearly report for the 6 months
under review to 30 September 2013.
The company continues to maintain a position in Disruptive Tech Limited
(formerly eSeekers Limited) and Advanced Laser Imaging Limited, both acquired
during the period under review, and in Stream TV Networks Inc., Rosslyn
Analytics Limited and Portr Limited, acquired after the period end. Further
details and update announcements can be found on our website at
www.velatechplc.com.
We look forward to a least one if not two of our investments obtaining a public
quotation sometime during 2014.
We are constantly looking at potential new investments that will add further
value to our portfolio.
Details of all related party transactions can be found at note 10 of these
interim accounts.
N.B. Fitzpatrick MBE
Chairman
For further Information:
Brent Fitzpatrick, Non-Executive Chairman 0207 330 1885
Antony Laiker, Director
Vela Technologies plc
ZAI Corporate Finance, Nomad 020 7060 2220
Peter Trevelyan-Clark/
Tim Cofman/Wei Wang
Peterhouse Corporate Finance, Broker 020 7469 0932
Eran Zucker
unaudited statement of comprehensive income
for the six months ended 30 September 2013
6 months 6 months year
ended ended ended
30 30 31
September September March
2013 2012 2013
Notes £'000 £'000 £'000
Revenue - - -
Cost of sales - - -
Gross profit - - -
Administrative expenses
- depreciation - - -
- share-based payments - (2) (2)
- other administrative expenses (98) (451) (561)
- Amounts written off in CVA 7 - - 430
Total administrative expenses and (98) (453) (133)
loss from operations
Interest payable - - -
Profit on disposal of subsidiary 6 - 273 273
Profit on disposal of associate - - -
Profit/(loss) before tax (98) (180) 140
Income tax - - (45)
Profit/(loss) and total (98) (180) 95
comprehensive income
Attributable to:
Equity holders of the company (98) (180) 95
Earnings per share
Basic and diluted earnings/(loss) 5 (0.11) (2.34) 0.47
per share (pence)
unaudited balance sheet
as at 30 September 2013
30 30 31
September September March
2013 2012 2013
Notes £'000 £'000 £'000
Assets
Investments 8 264 - -
Current assets
Trade and other receivables 17 36 11
Cash and cash equivalents 61 44 104
Total current assets 78 80 115
Non current assets held for - - -
sale
Total assets 342 80 115
Equity and liabilities
Equity
Called up share capital 9 133 4,852 4,912
Capital redemption reserve - 13,188 13,188
Share-based payment reserve - 1,178 -
Share premium account 257 23,792 24,032
Retained earnings (127) (43,546) (42,093)
Total equity 263 (536) 39
Current liabilities
Trade and other payables 79 616 76
Total liabilities 79 616 76
Total equity and liabilities 342 80 115
unaudited cashflow statement
for the six months ended 30 September 2013
6 months 6 months year
ended ended ended
30 30 31
September September March
2013 2012 2013
£'000 £'000 £'000
Operating activities
(Loss)/profit before tax (98) (180) 140
Share-based charge - 2 2
(Increase)/Decrease in receivables (6) 15 40
Increase in payables 3 154 86
Gain on Company Voluntary - - (430)
Arrangement
(Utilisation) of provision for - - (42)
onerous lease
Profit on disposal of subsidiaries - (273) (273)
Tax charge - - (45)
Total cash flow from operating (101) (282) (522)
activities
Investing activities
Consideration for disposal of - 323 323
investment in subsidiary
Consideration for acquisition in (264) - -
associates
Total cash flow from investing (264) 323 323
activities
Financing activities
Issue of ordinary share capital 65 - 60
Share premium on the issue of 257 - 240
ordinary share
Total cash flow from financing 322 - 300
activities
Net (decrease)/increase in cash (43) 41 101
and cash equivalents
Cash and cash equivalents at start 104 3 3
of year/period
Cash and cash equivalents at the 61 44 104
end of the year/period
Cash and cash equivalents
comprise:
Cash and cash in bank 61 44 104
Cash and cash equivalents at end 61 44 104
of year/period
unaudited statement of changes in equity
for the six months ended 30 September 2013
Capital Share-based
Share Share Redemption payment Retained Total
capital Premium Reserve reserve Earnings Equity
£'000 £'000 £'000 £'000 £'000 £'000
Balance at 1 April 4,912 24,032 13,188 - (42,093) 39
2013
Share option - - - - - -
charge
Share options - - - - - -
lapse
Capital (4,844) (24,032) (13,188) - 42,064 -
restructure
Issue of share 65 257 - - - 322
capital
Transactions with - - - - - -
owners
Profit for the - - - - (98) (98)
period and total
comprehensive
income for the
period
Balance at 30 133 257 - - (127) 263
September 2013
Balance at 1 April 4,852 23,792 13,188 1,176 (43,366) (358)
2012
Share option - - - 2 - 2
charge
Share options - - - - - -
lapse
Issue of share - - - - - -
capital
Transactions with - - - - - -
owners
Profit for the - - - - (180) (180)
year and total
comprehensive
income for the
year
Balance at 30 4,852 23,792 13,188 1,178 (43,546) (536)
September 2012
Balance at 1 April 4,852 23,792 13,188 1,176 (43,366) (358)
2012
Share option - - - 2 - 2
charge
Share options - - - (1,178) 1,178 -
lapse
Issue of share 60 240 - - - 300
capital
Transactions with 60 240 - (1,176) 1,178 302
owners
Profit for the - - - - 95 95
year and total
comprehensive
income for the
year
Balance at 31 4,912 24,032 13,188 - (42,093) 39
March 2013
notes to the interimaccounts
for the six months ended 30 September 2013
1. General information
Vela Technologies Plc is a company incorporated n the United Kingdom.
These unaudited condensed interim financial statements for the six months ended
30 September 2013 have been prepared in accordance with International Financial
Reporting Standards (IFRS) and IAS 34 "Interim Financial Reporting" as adopted
by the European Union and do not constitute statutory accounts as defined in
Section 434 of the Companies Act 2006. This condensed set of financial
statements has been prepared applying the accounting policies that were applied
in the preparation of the Company's published financial statements for the year
ended 31 March 2013 and are presented in pounds sterling.
The comparative figures for the financial year ended 31 March 2013 have been
extracted from the Company's statutory accounts which have been delivered to
the Registrar of Companies and reported on by the company's Auditors. Their
report was unqualified and contained no statement under section 298 (2) or (3)
of the Companies Act 2006.
2. Changes in accounting policy
The assessment of new standards, amendments and interpretations issued but not
effective, are not anticipated to have a material impact on the interim
financial statements.
3. Going concern
The company's activities, together with the factors likely to affect its future
development and performance, the financial position of the company, its cash
flows and liquidity position have been considered by the Directors, taking
account of the current market conditions which demonstrate that the company
shall continue to operate within its own resources.
The Directors believe that the company is well placed to manage its business
risks successfully, and that the company has adequate resources to continue in
operational existence for the foreseeable future. Accordingly, they consider it
appropriate to adopt the going concern basis in preparing these condensed
financial statements.
4. Investments
Fixed asset investments are stated at cost less provision for diminution in
value.
5.Earnings per share
Earnings per share has been calculated on a loss after tax of £98,000 (period
to 30 September 2012: £180,000 loss; year to 31 March 2013: £95,000 profit) and
the weighted number of average shares in issue for the year of 88,679,309
weighted (30 September 2012: 7,679,309 weighted; 31 March 2013: 20,008,076).
Reconciliation of the profit and weighted average number of shares used in the
calculations are set out below:
6 months ended 6 months ended Year ended
30 September 30 September 31 March
2013 2012 2013
Profit/(loss) (£'000) (98) (180) 95
Earnings per share (pence) (0.11) (2.34) 0.47
A capital reorganisation was approved at a General Meeting held on 28 May 2012.
Each of the Company's existing Ordinary shares of 0.1p each were subdivided
into 1 `New' Ordinary Share of 0.001 pence (`New shares') and 99 New Deferred
shares of 0.001 pence (`New Deferred Shares'). The New Shares above were
consolidated into New Ordinary Shares of 0.1 pence each on the basis of 1 New
Ordinary Share for every 100 New Shares. The Admission of the New Ordinary
Shares to trading on AIM took place on 29 May 2012.
The Earnings per Share comparatives have been adjusted to reflect the
redenomination of the share capital.
6.Disposal of subsidiary / Non current assets held for sale
Disposal of DGM India Internet Marketing Limited (DGM India)
On 4 April 2012, the Board entered into a sale and purchase agreement for the
disposal of the subsidiary, DGM India, to Tyroo Media Private Limited and to
Inflection Digital Holdings Private Limited (both of which are private
companies incorporated and registered in India), for a total gross
consideration of 33,500,000 ruppees (approx £412,760). This transaction
completed in July 2012.
The carrying value of the investment in the subsidiary was recognised as a "non
current asset held for sale" as at 31 March 2012.
The profit on disposal was calculated as proceeds net of costs (£323,000) less
carrying value of asset (£50,000) giving the profit recognised of £273,000.
At 31 March 2013 all subsidiaries had been disposed of.
7.Amounts written off in CVA
On 21 December 2012 the Company entered a company voluntary arrangement ("CVA")
and on 14th January 2013 the Company's creditors and members approved the CVA
proposed by the previous directors of the Company who resigned on 18th January
2013. Since this approval the Joint Supervisors have established all claims and
despatched payments in respect of valid claims at the rate set in the approved
arrangement being 17 pence in the pound before administrators' costs. The first
and final dividend was paid on 29 April 2013 at a rate of 15.96 pence in the
pound. The CVA was successfully completed on 29 August 2013.
In December 2012 new investors conditionally subscribed for a number of
ordinary shares, which generated substantial funds into the Company. Net funds
received of some £280,000 allowed £99,189 to be used for the benefit of the CVA
creditors, with the balance to allow the Company to fulfil its new investing
policy.
The amount written off represents the difference between the total creditors
approved and the dividend paid.
8. Investments
Other
investments
Cost at 1 April 2013 -
Purchased in the period 264
Cost at 30 September 2013 264
Investment in Disruptive Tech Ltd
On 14 August 2013 the Company acquired 262,090 shares, ultimately representing
a 0.62% interest in Disruptive Tech Ltd (a Gibraltar Company) for a total of £
250,000. The purchase price was satisfied by a cash payment of £125,000 and the
balance of £125,000 by way of the issue of 8,333,333 Ordinary shares of 0.1
pence at a price of 0.15p.
Investment in Advance Laser Imaging Limited
On 11 September 2013 the Company acquired a £75,000 investment in Advance Laser
Imaging Ltd representing a 6.25% share.
Investment in Stream TV Networks Inc.
The Company acquired a minority investment for £64,000 by way of Convertible
Loan Note in Stream TV Networks Inc. ("Stream TV") a Delaware-based technology
company. The Loan Notes will accrue simple interest at the rate of twelve (12%)
per cent annually until 31 December 2014.
9.Share capital
30 30 31
September September March
2013 2012 2013
£'000 £'000 £'000
Authorised capital
9,999,520,000 ordinary shares of 0.1 pence 10,000 10,000 10,000
each
76,025,157,516 deferred shares of 0.001 pence 760 760 760
4,083,918,156 deferred shares of 0.1 pence 4,084 4,084 4,084
each
54,952,000 deferred shares of 24 pence each 13,188 13,188 13,188
28,032 28,032 28,032
Allotted, called up and fully paid capital
67,679,309 (30 September 2012: 7,679,309) 133 8 68
ordinary shares of 0.1 pence each
76,025,157,516 deferred shares of 0.001 pence - 760 760
4,083,918,156 deferred shares of 0.1 pence - 4,084 4,084
each
133 4,852 4,912
Allotments during the period
The Company allotted the following ordinary shares during the period:
6 months ended 30 September 2013
Shares in issue at 1 April 2013 67,679,309
Shares issued during the year 65,000,000
Shares in issue at 30 September 2013 132,679,309
6 months ended 30 September 2012
Shares in issue at 1 April 2012 7,679,309
Shares issued during the period -
Shares in issue at 30 September 2012 7,679,309
Year ended 31 March 2013
Shares in issue at 1 April 2012 7,679,309
Shares issued during the period 60,000,000
Shares in issue at 31 March 2013 67,679,309
A capital reorganisation was approved at a General Meeting held on 28 May 2012.
Each of the Company's existing Ordinary shares of 0.1p each have been
subdivided into 1 `New' Ordinary Share of 0.001 pence (`New shares') and 99 New
Deferred shares of 0.001 pence (`New Deferred Shares'). The New Shares above
have been consolidated into New Ordinary Shares of 0.1 pence each on the basis
of 1 New Ordinary Share for every 100 New Shares. The Admission of the New
Ordinary Shares to trading on AIM took place on 29 May 2012.
The Company's main source of capital is the parent Company's equity shares. The
policy is to retain sufficient authorised share capital so as to be able to
issue further shares to fund acquisitions, settle share-based transactions and
raise new funds.
On 24th December 2012, the Company announced that Adrian Moss, a former
director of the company had agreed to participate in a placing of 5,000,000
0.01p shares at a price of 0.05p for a total consideration of £25,000. This
transaction completed on 5 September 2013. On completion of this Adrian Moss
owns 5,995,100 shares in the Company representing a shareholding of 4.25%.
A further issue of shares took place on 9 August 2013, 60,000,000 Ordinary
shares of 0.1 pence being issued at 0.5p each generating gross proceeds of £
300,000.
10.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 period the Company paid £6,000 (30
September 2012: £nil; 31 March 2013 : £2,500) in respect of his directors fees
to the Company. The balance due to Ocean Park Developments at the period end
was £nil (30 September 2012 £nil; 31March 2013 : £nil).
Risk Alliance Insurance Brokers Limited
Nigel Brent Fitzpatrick, Non-Executive director is also a director of Risk
Alliance Insurance Brokers Limited. During the period the Company paid £3,975
(30 September 2012: £nil; 31 March 2013: £nil) in respect of insurance services
for the Company. The balance due to Risk Alliance Insurance Brokers Limited at
the period end was £nil (30 September 2012 £nil; 31March 2013 : £nil)
Share Options held by Directors
On 21 December 2012, the following share options held by the former directors
lapsed when the Company entered a CVA:
Adrian Moss - 174,000 options
David Lees - 17,500 options
Keith Lassman - 12,500 options
Placing of shares
On 24th December 2012, the Company announced that Adrian Moss, a former
director of the company had agreed to participate in a placing of 5,000,000
0.01p shares at a price of 0.05p for a total consideration of £25,000. This
transaction completed on 5 September 2013. On completion of this Adrian Moss
will own 5,995,100 shares in the Company representing a shareholding of 4.25%.
11.Events after the balance sheet date
Investment in Rosslyn AnalyticsLtd
On 9 October 2013, the Board announced that the Board a £100,002 investment in
Rosslyn Analytics Ltd. The Company has committed £100,002 for a 0.7% interest.
Investment in Portr Ltd
The Company announced an investment of £50,000 by way of a cash subscription
for 32,136 new ordinary shares of 0.0001p each in Portr Limited, for a 2%
interest.
Placing of 11,500,000 Ordinary Shares
A further issue of shares took place on 9 October 2013, 11,500,000 Ordinary
shares of 0.1 pence being issued at 1p each generating gross proceeds of £
115,000.
12. Principal risks and uncertainties
Principal risks and uncertainties are set out in the annual financial
statements within the directors' report and also in note 14 and are reviewed on
an on-going basis.
The Board will provide leadership within a framework of appropriate and
effective controls. The Board will set up, operate and monitor the corporate
governance values of the company, and will have overall responsibility for
setting the company's strategic aims, defining the business objective, managing
the financial and operational resources of the Company and reviewing the
performance of the officers and management of the company's business both prior
to and following an acquisition.
There have been no significant changes in the first six months of the financial
year to the principle risks and uncertainties as set out in the 31 March 2013
Annual Report and Accounts.
13. Board Approval
These interim results were approved by the Board of Vela Technologies PLC on
18th December 2013.
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