Final Results

31 July 2019

LIMITLESS EARTH PLC

("Limitless" or the "Company")

Final Results for the year to 31 January 2019 and Notice of AGM

The Company announces its final results for the year to 31 January 2019.

The Company also announces that its Annual General Meeting will be held at 10:00 a.m. on 24 September 2019 at 2^nd Floor, 2 London Wall Buildings, London, EC2M 5PP.

The Annual Report and Accounts for the year ended 31 January 2019, together with the Notice of Annual General Meeting will shortly be posted to shareholders and uploaded to the Company’s website www.limitlessearthplc.com.

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014.

For further information, please contact:

Limitless Earth plc                                                     [phone]     

Guido Contesso                        www.limitlessearthplc.com     

Cairn Financial Advisers LLP                                   [phone]              

Nominated Adviser                                                      www.cairnfin.com                              

Jo Turner/Tony Rawlinson                                        

Peterhouse Corporate Finance Limited                     [phone]               

Broker                                                                         www.pcorpfin.com              

Peter Greensmith/Charles Goodfellow                                               

Chairman’s Statement

We focus on identifying opportunities where the changing patterns of consumer behaviour and population are key drivers of growth and we target investments which demonstrate the potential to generate substantial returns through capital appreciation.

Working within the broader field of demographic trend investing, we have initially concentrated on cleantech (Saxa Gres), life sciences (Chronix) and technology (V-Nova and Exogenesis).

The board is acutely aware of the importance of making the right investment in the right sector at the right time and has considered and will continue to consider a broad range of attractive opportunities that are sourced by the board or are introduced to it and will chose to invest in only the best of these.

The Company is well funded with cash and cash equivalents at the reporting date of £530,863.

To date, we have made investments which have varied in nature from equity to convertible loans in four companies.

These are:

The Investments

Saxa Gres S.p.A, a turn-around circular economy company which specialises in an innovative tile production process  , has been extremely successful in expanding its operations by competitor acquisitions and this has enabled it to satisfy the increasing demands for its products while attracting valuable funding from relevant institutional investors

Saxa’s founders, management and professionals have demonstrated outstanding achievements in terms of the development of its operations, sales, product expansion and integration of its acquisitions.

V-Nova Ltd. is a London-headquartered technology company providing next-generation compression solutions that address the ever-growing media processing and delivery challenges. V-Nova as an IP Software company has developed an innovative video and imaging compression technology, with a valid proof of revenues and concept also in relevant emerging markets countries.

V-Nova provides solutions spanning the entire media delivery chain, including content production, contribution, storage and distribution to end users.

LME is pleased to learn that Moving Picture Experts Group (MPEG) has selected V-Nova’s technology to become a new standard (MPEG5-Part2), which is expected to yield V-Nova a recurring revenue stream for a long period.

V-Nova’s management have helped ensure that the company’s technology is becoming an integrated world standard. LME is optimistic that V-Nova may now be at a stage of development where it will be able to exploit its years of hard work and, importantly, recoup its investment to date as it progresses towards reaching profitability and expanding V-Nova’s patented capabilities in as many verticals as possible.

Chronix Biomedical, inc., is a privately-owned biotech company founded in 1997 which specialises in simple blood tests (liquid biopsies) for real-time monitoring of the effectiveness of cancer drugs, including immunotherapies, and rejection of transplanted organs. The Cancer test is based on a patented technology whereby the Company can identify gains and losses in cell free DNA that allow them to determine if a cancer therapy is working. The transplant test allows the Company to determine if the organ that is transplanted is being accepted or rejected, and thereby allows the physician to alter the immunosuppressive drug regimen given to the patient.

In June 2018, Chronix signed it first commercial agreement with a large EU-based lab group, which already processes more than 150,000 laboratory samples daily, providing an exclusive licence for Germany, Austria, Switzerland and Belgium. The contract is for 15 years and Independent research analysts have estimated the net present value of the licensing payments to Chronix over the life of the agreement to be approximately $92 million.

We value and recognise the considerable achievements of Chronix’s management and understand that additional partnership agreements need to be secured in order to increase revenue, exploit its potential and, ultimately, drive company valuation.  Chronix’s management is actively raising funds to support such growth and to allow it to file additional patents.  The Company expects to be profitable in 2-3 years.

Exogenesis Corporation is a Boston-based nanotech firm which specialises in modifying and controlling the surface of objects at a nanoscale level, through accelerated particle beam processing, to avoid needing to apply coatings.  Application of the company’s technology can improve the safety and efficacy of implantable medical devices and improving the performance of optics, glass and a variety of substrates used in the laser, memory and semiconductor industries.  

We recognise the Exogenesis’ technological achievements and, as it has still to prove its revenue streams, await news of its first commercial deals which are expected to be linked to its existing vertical sectors. 

Guido Contesso

Chief Executive Officer

Income Statement and Statement of Comprehensive Income

for the year ended 31 January 2019

		Year ended 31 January	Year ended 31 January
		2019	2018
Continuing operations		£	£
Investment income		47,312	54,103
Total income		47,312	54,103
Administrative expenses		(184,391)	(218,741)
Foreign currency exchange gain		108,541	-
Operating loss and Loss before taxation		(28,538)	(164,638)
Taxation		-	-
Loss for the year		(28,538)	(164,638)
Total comprehensive loss for the year		(28,538)	(164,638)
Earnings per share:
Basic and diluted earning per share		(0.04p)	(0.25p)

There are no items of other comprehensive income.

Statement of Financial Position

As at 31 January 2019

		2019	2018
		£	£
Non-current assets
Financial asset investments		1,711,809	1,603,268
Current assets
Trade and other receivables		33,289	39,128
Cash and cash equivalents		530,863	648,333
Current and Total Assets		2,275,961	2,290,729
Current Liabilities
Trade and other payables		(67,490)	(53,720)
Net Assets		2,208,471	2,237,009
Equity
Issued Share Capital		654,000	654,000
Share Premium		2,350,630	2,350,630
Share warrant reserve		14,095	14,095
Retained Earnings		(810,254)	(781,716)
Total Equity		2,208,471	2,237,009

Statement of Changes in Equity

for the year ended 31 January 2019

	Share capital	Share premium	Share warrant reserve	Retained earnings	Total
	£	£	£	£	£
At 31 January 2017	654,000	2,350,630	14,095	(617,078)	2,401,647
Changes in Equity for the period ended 31 January 2018
Total comprehensive loss for the year	-	-	-	(164,638)	(164,638)
At 31 January 2018	654,000	2,350,630	14,095	(781,716)	2,237,009
Changes in Equity for the period ended 31 January 2019
Total comprehensive loss for the year	-	-	-	(28,538)	(28,538)
At 31 January 2019	654,000	2,350,630	14,095	(810,254)	2,208,471

Statement of Cash Flows

for the year ended 31 January 2019

	Notes	Year ended 31 January	Year ended 31 January
		2019	2018
		£	£
Cash flows from operating activities
(Loss) for the year before tax		(28,538)	(164,638)
Investment income		(47,312)	(54,103)
Foreign currency exchange gain		(108,541)	-
Decrease/ (increase) in receivables		5,839	5,974
(Decrease)/ increase in payables		13,770	(27,762)
Net cash outflow from operating activities		(164,782)	(240,529)
Cash flows from investing activities
Investment income received net		47,312	54,103
Purchase of investments		-	(306,825)
Net cash outflow from investing activities		47,312	(252,722)
Net decrease in cash and cash equivalents during the year		(117,470)	(493,251)
Cash at the beginning of year		648,333	1,141,584
Cash and cash equivalents at the end of the year		530,863	648,333

Notes

1.General information

Limitless Earth Plc is a company incorporated and domiciled in the United Kingdom. The Company is a public limited company, which is listed on the AIM market of the London Stock Exchange. The address of the registered office is 30 Percy Street, London, W1T 2DB.

The Investing Policy is to invest principally, but not exclusively, in sectors where changing demographic factors are important drivers of growth. The Company intends to focus initially on projects located in Europe but will also consider investments in other geographical regions. The Company may become an active investor, acquire controlling stakes or minority positions, in each case, as the Board considers appropriate and commercial.

The financial statements are presented in British Pounds Sterling, the currency of the primary economic environment in which the Company’s operates from.

The summary above is an extract of the report and accounts to 31 January 2018, which should be read in full.  References to page numbers and notes are in relation to the full report which is available on the Company’s website.

2.Summary of Significant Accounting Policies

Basis of preparation

The financial statements have been prepared in accordance with International Financial Reporting Standards (IFRSs) and IFRIC interpretations as adopted by the European Union applicable to companies reporting under IFRSs.  The financial statements have also been prepared under the historical cost convention.

The preparation of financial statements in conformity with IFRSs requires the use of certain critical accounting estimates.  It also requires management to exercise its judgement in the process of applying the Company’s accounting policies.  The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed later in these accounting policies.

Going Concern

The directors have, at the time of approving the financial statements, a reasonable expectation that the Company has adequate resources to continue in existence for the foreseeable future.  Thus, they continue to adopt the going concern basis of accounting in preparing the financial statements.

Changes in accounting policies and disclosures

New standards, amendments and interpretations adopted by the Company

The company has applied the following standards and amendments for the first time for its annual reporting period commencing 1 February 2018:

• IFRS 9 Financial Instruments;
• IFRS 15 Revenue from contracts with customers;
• Annual improvements 2014-2016 cycle;

Impact of adoption of IFRS 9

The classification and measurement requirements of IFRS 9 have been adopted with effect from the date of initial application on 1 February 2018. However, the Company has chosen to take advantage of the option not to restate comparatives. Therefore, the 2018 figures are presented and measured under IAS 39. The following table shows the original measurement categories in accordance with IAS 39 and the new measurement categories under IFRS 9 for the Company’s financial assets and financial liabilities as at 1 February 2018:

1 February 2018	IAS 39 classification	IAS 39 measurement	IFRS 9 classification	IFRS 9 measurement
		£		£
Financial assets
Cash and cash equivalents	Loans and receivables	648,333	Amortised cost	648,333
Financial assets at fair value through profit or loss	Held for trading at fair value through profit or loss	1,603,268	Fair value through profit or loss	1,603,268
Financial liabilities
Payables	Other financial liabilities	53,720	Amortised cost	53,720

3.Investments held for trading

	2019 £	2018 £
At 1 February	1,603,268	1,296,443
Cost of investment purchases	-	306,825
Foreign currency exchange gain	108,541	-
Fair value adjustment	-	-
31 January – Investments at fair value	1,711,809	1,603,268
Categorised as:
Level 3 – Unquoted investments	1,711,809	1,603,268
	1,711,809	1,603,268

Chronix Biomedical Inc (“ Chronix”)

On 8 October 2015 the Company made an investment in Chronix of US$500,000 (approximately £329,511) in the series I round of convertible preference stock (“Series I Stock”) at a price of US$0.40 per share. On a fully diluted basis, considering all classes of common and preference stock in issue, at the date of investment, Limitless’ investment represented 0.72% of Chronix’s issued share capital and values Chronix at approximately US$69 million.

V Nova International Ltd (“V-Nova”)

On 18 December 2015, the Company made a cash investment of £500,000 in V-Nova, a company that specialises in Advanced Signal & Data Compression Solutions. The investment was through the acquisition of £500,000 worth of Convertible loan notes. On 4 April 2017, these notes were converted into 7,284,382 Series B1 Participating shares at a 20% discount to the preferential valuation of V-Nova at the time, of £100 million.

Saxa Gres S.A (”Saxa”)

On 23 December 2015, the Company invested €350,000 (approximately £258,830) in Saxa.  As a first round subscriber, Limitless has also been granted an option to acquire 1.1655 per cent. of the equity in Saxa at nominal value with the intention that, once the bonds have been repaid, Limitless will be able to maintain an interest in Saxa of approximate value to the bond investment.

On 21 March 2017, Limitless announced that it had increased its investment in Saxa Gres by acquiring a further 267 Notes for a value of €267,000. These Notes were also accompanied by options to acquire shares in Saxa Gres, in this case to acquire another 1.333% of its equity share capital with each option having an exercise price of €1. In total, Limitless has options to acquire approximately 2.5% of the equity share capital of Saxa Gres at an exercise price of €1 per share.

On 16 November 2017, the company announced that it had made a further investment in Saxa Gres S.p.A. of approximately EUR €75,000.  Saxa Gres was raising funds, via an increase in its share capital, in order to invest in a new production line, it required to meet a significant increase in orders. Limitless participated alongside two sizable credit funds in order to maintain its interest in Saxa Gres.

Exogenesis

On 6 May 2016, the Company made an investment in Exogenesis, a nanotechnology company which has developed nanoscale surface modification technology to, inter alia, improve the safety and efficacy of implantable medical devices and is being used to develop next generation microscopy tools for DNA analysis.

The Company invested US$300,000 (approximately £200,000) in the Exogenesis senior convertible notes which accrued an 8 % annual interest (“Notes”).  The Notes, together with accrued interest, are convertible into Exogenesis series B preferred stock at a price of US$0.382 per share or, at the option of Limitless, into Exogenesis series C preferred stock at a 20 % discount to the issue price at the time of the next financing. 

On 9 June 2017, the Company extended the maturity date of the loan notes to 31 December 2017 from 30 June 2017 and lowered the conversion threshold amount to $2,500,000. Upon the cash financing being achieved and the maturity date being reached, the notes were then converted into series B preferred stock at the agreed price.

4.Earning Per Share

(a)  Basic

Basic earning per share is calculated by dividing the loss attributable to equity holders of the Company by the weighted average number of ordinary shares in issue during the period.

	2019	2018
	£	£
Loss from continuing operations attributable to equity holders of the company	(28,538)	(164,638)
Weighted average number of ordinary shares in issue	65,400,000	65,400,000
	Pence	Pence
Basic negative earning per share from continuing operations	(0.04)	(0.25)

b)  Diluted

Diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares outstanding to assume conversion of all dilutive potential ordinary shares. No share warrants outstanding at 31 January 2019 were dilutive and all such potential ordinary shares are therefore excluded from the weighted average number of ordinary shares for the purposes of calculating diluted earnings per share. Details of warrants outstanding are given in note 17.