Interim Results - six months ended 30 June 2021
This announcement contains inside information as stipulated under the UK version of the Market Abuse Regulation No 596/2014 which is part of English Law by virtue of the European (Withdrawal) Act 2018, as amended. On publication of this announcement, this information is now considered to be in the public domain.
2 September 2021
Bidstack Group Plc
("Bidstack" or "Company" or "Group")
Interim Results for the six months ended 30 June 2021
-Good financial and operational progress. Well capitalised to pursue growth strategy --
Bidstack Group Plc (AIM: BIDS.L), the native in-game advertising group, announces its unaudited results for the six months ended 30 June 2021. The Interim Report for the period ended 30 June 2021 will be published on the Company's website - www.bidstackgroup.com today.
Financial Highlights
· Revenue of £820k (H1 2020: £274k);
· Gross margin improvement to 34.5% (H1 2020: 27.9%);
· Period end cash balance of £695k (30 June 2020: £5.9m);
· Loss per share reduced to 0.74 pence (H1 2020: loss of 1.18 pence per share).
Post Period End Highlights
· Successful £10.863m equity fundraising (before expenses) completed on 23 July 2021;
· Bryan Neider, 25 year veteran at Electronic Arts, joined the Board as an independent Non-Executive Director on 23 July 2021.
Operational Highlights
- Significant progress made in onboarding titles across stadium, racing and open world environments as well as Unity, Unreal and custom games engines;
- Now offering advertisers increased and broader inventory from a portfolio with over 30 games;
- Reinforcing relationships with the world's leading agency holding groups which are now growing outside of the UK and US;
- Developing momentum in engaging directly with brands;
- Continuing to integrate with established third party ad-tech vendors which increases accessibility to Bidstack inventory in core markets;
- Significant developments with the IAB, the industry trade body, in defining "in-game" as a new formal advertising category and providing scalable guidelines.
Donald Stewart, Chairman, said:
"Following completion of the fundraise on 23 July 2021, with approximately £10.2 million of net proceeds, Bidstack is now well capitalised to exploit the commercial opportunities it currently has and to pursue its strategy for some time to come.
"The second half of the current financial year has started well and in line with our expectations. Since the period end Bidstack has onboarded a number of new games including Nordeus' flagship football management game, Top Eleven, T-Bull's classic car driving simulation game Racing Classics PRO: Drag Race & Real Speed, Motionlab Interactive's multiplayer PDC Darts Match and Suji Games' animated simulation game Hyper Airways. We expect a number of further games to join Bidstack's roster in the second half.
"With improving visibility of the sales pipeline, we believe the Company has a strong pipeline of revenue for the second half as existing advertisers rebook with growing spend and business development efforts come to fruition.
"The Company continues to expect to deliver revenues for the year in line with market expectations. In addition, the Board has been focussed on improving gross margin and controlling the Group's total operational costs going forward, as it starts to rebalance capital deployed to reflect the shift from product development to commercialisation."
James Draper, Chief Executive, said:
"I want to put on record how proud I am of the team's continued work towards establishing Bidstack as a stalwart of in-game advertising. Watching our incredible staff establish and build-out relationships with some of the world's most recognised advertisers, agencies, technology providers and game studios leaves me in no doubt that Bidstack is going from strength to strength.
"Our technology and commercial expertise are proven and in high demand - and the understanding our team has shown towards our customers and potential partners is delivering additional opportunities.
"Our progress year-to-date reflects the team's dedication to driving the business across advertisers, game developers and product strategy.
"Campaign spends are growing substantially and the number of game studios wanting to work with our team is expanding.
"Key highlights, such as the exclusive partnership with Nordeus, progress in the US with the IAB and growing access to our inventory, all lead me to believe we are on the pathway to scalability.
"The opportunities that lie ahead in the second half in relation to innovative product launches have our team hugely motivated - and we look forward to sharing more of these developments when we can."
For further information please contact:
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Bidstack Group Plc |
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James Draper, CEO |
via Buchanan |
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SPARK Advisory Partners Limited (Nomad) |
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Mark Brady/Neil Baldwin/James Keeshan |
+44 (0) 203 368 3550 |
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Stifel Nicolaus Europe Limited (Broker) |
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Fred Walsh |
+44 (0) 20 7710 7600 |
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Buchanan Communications Limited |
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Chris Lane/Stephanie Watson/Kim van Beeck |
+44 (0) 20 7466 5000 |
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Chairman's Statement
H1 Trading
Bidstack has made significant progress in onboarding titles across stadium, racing and open world environments as well as Unity, Unreal and custom games engines. The Company has continued to strengthen its portfolio of AAA, high-fidelity games, independent and mobile publisher base.
The Company has successfully onboarded game developers who have endorsed Bidstack's SDK for its ease of integration, stability of the technology and immersive implementation of advertising which enhances the player experience. The pipeline of games is robust as game developers increasingly look for incremental revenue streams and entrust Bidstack with their portfolio of titles.
Bidstack continues to reinforce its relationships with the world's leading agency holding groups which are now growing outside of the UK and US, enabled by multi-agency master agreements already in place. The progress that the Company continues to make in engaging directly with brands is developing momentum from Bidstack's vertical led approach that encompasses all major advertising categories including technology, retail, automotive, consumer packaged goods, beauty, luxury, gambling and financial services.
The Company continues to integrate with established third-party ad-tech vendors which increases accessibility to Bidstack inventory in core markets, comprising the UK and the US. This is an important development which marks the maturity, growth and frictionless scalability of the industry. Further integrations are planned to drive automation and expansion.
There have been material developments with the IAB, the industry trade body, in defining "in-game" as a new formal advertising category and providing scalable guidelines. The establishment of an IAB US committee, of which Bidstack is an active member, is expected to expand the foundational framework which is being delivered in the UK. Progress is encouraging, with key industry stakeholders across the value chain unified in creating standards which should enable frictionless growth.
Fundraising
On 2 July 2021, Bidstack announced the results of a fundraising which raised gross proceeds of £10.863m comprising a placing with institutional and other investors (£9.763m) and a subscription from Company directors and others (£1.1m).
Board and Strategic Adviser Appointments
On 22 April 2021 Lisa Hau, Bidstack's Chief Operating Officer, joined the Board as an Executive Director and Glen Calvert, the former COO of Fnatic Ltd, was appointed an independent Non-executive Director.
Prior to joining Bidstack in May 2020, Lisa led investor relations at WPP PLC following five years as an equity research analyst heading up coverage for the European media and internet sector with Jefferies, a leading multinational investment bank.
Glen was COO of Fnatic Ltd, between January 2019 and May 2021. He is currently launching Kaizan.ai, an AI start-up augmenting team intelligence. Previously he was a founder and CEO of Affectv and a member of the founding team at Struq, which was acquired by Quantcast in 2014.
On 29 April 2021, Katherine Hays, the Co-Founder and former COO of Massive Inc. joined Bidstack as a Strategic Adviser. Katherine has a proven track record in advertising, media, entertainment and gaming. She will take an active role in giving the Company the benefit of her experience and success from the first generation of in-game advertising.
On 23 July, following completion of the fundraising, Bryan Neider was appointed to the Board as an independent Non-Executive director and Chair of the Audit Committee. Bryan brings more than 25 years of experience during his tenure at Electronic Arts and served a variety of leadership roles including managing global business development, corporate finance, CFO and COO for EA.com, CFO of Worldwide Studios, COO for EA's global development organisation and SVP of Global Operations.
Outlook and Future Prospects
Following completion of the fundraise on 23 July 2021, with approximately £10.2 million of net proceeds, Bidstack is now well capitalised to exploit the commercial opportunities it currently has and to pursue its growth strategy
The second half of the current financial year has started well and in line with our expectations.
Since the period end Bidstack has onboarded a number of new games including Nordeus' flagship football management game, Top Eleven, T-Bull's classic car driving simulation game Racing Classics PRO: Drag Race & Real Speed, Motionlab Interactive's multiplayer PDC Darts Match and Suji Games' animated simulation game Hyper Airways. The Directors expect a number of further games to join Bidstack's roster in the second half.
Bidstack's growth is reflected in its portfolio rising to over 30 games and a growing roster of premium brands. With improving visibility of the sales pipeline, the Directors believe the Company has strong revenue prospects for the second half, as the existing roster of advertisers rebook with growing spend and business development efforts come to fruition.
The Company continues to expect to deliver revenues for the year in line with market expectations. In addition, the Board has been focussed on improving gross margin and controlling the Group's total operational costs going forward, as it starts to rebalance capital deployed to reflect the shift from product development to commercialisation.
Consolidated statement of comprehensive income
for the six months ended 30 June 2021
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Note |
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Unaudited 6 months ended 30 Jun 2021 |
Unaudited 6 months ended 30 Jun 2020 |
Audited year ended 31 Dec 2020 |
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£ |
£ |
£ |
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Revenue |
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820,136 |
274,079 |
1,695,620 |
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Cost of sales |
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(537,309) |
(197,337) |
(1,470,389) |
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Gross profit |
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282,827 |
76,742 |
225,231 |
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Administrative expenses |
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(3,915,874) |
(3,244,889) |
(7,218,789) |
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Operating loss |
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(3,633,047) |
(3,168,147) |
(6,993,558) |
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Finance income |
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60 |
2,352 |
2,525 |
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Finance costs |
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(160) |
(700) |
(1,179) |
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Loss before taxation |
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(3,633,147) |
(3,166,495) |
(6,992,212)
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Taxation |
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744,756 |
50,493 |
597,035 |
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Loss for the period |
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(2,888,391) |
(3,116,002) |
(6,395,177) |
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Other comprehensive income |
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Total other comprehensive income |
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- |
- |
- |
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Total comprehensive loss for the period |
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(2,888,391) |
(3,116,002) |
(6,395,177) |
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Loss per share - basic and diluted (pence) |
3 |
(0.74) |
(1.18) |
(1.65) |
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The above consolidated statement of profit and loss and other comprehensive loss for the period relates to continuing operations for the Group.
Consolidated statement of financial position
as at 30 June 2021
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Note |
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Unaudited 30 Jun 2021 |
Unaudited 30 Jun 2020 |
Audited 31 Dec 2020 |
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ASSETS |
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£ |
£ |
£ |
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Non-current assets |
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Right of use asset |
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649 |
21,369 |
7,577 |
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Intangible assets |
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264,357 |
290,141 |
279,955 |
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Property, plant and equipment |
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41,277 |
23,795 |
28,388 |
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Total non-current assets |
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306,283 |
335,305 |
315,920 |
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Current assets |
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Trade and other receivables |
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1,229,387 |
862,660 |
2,391,300 |
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Cash and cash equivalents |
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694,544 |
5,917,381 |
2,347,114 |
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Total current assets |
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1,923,931 |
6,780,041 |
4,738,414 |
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Total assets |
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2,230,214 |
7,115,346 |
5,054,334 |
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EQUITY AND LIABILITIES |
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Equity |
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Share capital |
4 |
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6,234,261 |
6,229,259 |
6,234,261 |
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Share premium account |
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27,984,716 |
27,977,197 |
27,984,716 |
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Share-based payment reserve |
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1,497,826 |
1,035,638 |
1,282,556 |
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Merger relief reserve |
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6,508,673 |
6,508,673 |
6,508,673 |
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Reverse acquisition reserve |
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(23,320,632) |
(23,320,632) |
(23,320,632) |
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Warrant reserve |
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71,480 |
71,480 |
71,480 |
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Accumulated losses |
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(18,467,293) |
(12,299,727) |
(15,578,902) |
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Total equity |
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509,031 |
6,201,888 |
3,182,152 |
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Non - Current liabilities Lease liability |
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675 |
15,790 |
- |
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Total non -current liabilities |
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675 |
15,790 |
- |
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Current liabilities |
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Trade and other payables |
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1,720,508 |
897,014 |
1,863,739 |
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Lease liability |
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- |
654 |
8,443 |
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Total current liabilities |
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1,720,508 |
897,668 |
1,872,182 |
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Total equity and liabilities |
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2,230,214 |
7,115,346 |
5,054,334 |
The interim financial report was approved by the board of Directors on 1 September 2021 and signed on its behalf by:
Donald Stewart
Chairman of Bidstack Group Plc
Consolidated statement of changes in equity
for the six months ended 30 June 2021
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Share capital |
Share premium |
Share-based payment reserve |
Merger relief reserve |
Reverse acquisition reserve |
Warrant reserve |
Accumulated losses |
Total equity |
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£ |
£ |
£ |
£ |
£ |
£ |
£ |
£ |
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Balance as at 1 January 2021 |
6,234,261 |
27,984,716 |
1,282,556 |
6,508,673 |
(23,320,632) |
71,480 |
(15,578,902) |
3,182,152 |
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Comprehensive income for the period |
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Loss and total comprehensive income for the year |
- |
- |
- |
- |
- |
- |
(2,888,391) |
(2,888,391) |
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Total comprehensive expense |
- |
- |
- |
- |
- |
- |
(2,888,391) |
(2,888,391) |
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Transactions with owners |
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Issue of shares |
- |
- |
- |
- |
- |
- |
- |
- |
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Costs of raising equity |
- |
- |
- |
- |
- |
- |
- |
- |
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Share-based payments |
- |
- |
215,270 |
- |
- |
- |
- |
215,270 |
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Total transaction with owners |
- |
- |
215,270 |
- |
- |
- |
- |
215,270 |
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- |
- |
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Balance as at 30 June 2021 |
6,234,261 |
27,984,716 |
1,497,826 |
6,508,673 |
(23,320,632) |
71,480 |
(18,467,293) |
509,031 |
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Consolidated statement of changes in equity
for the six months ended 30 June 2020
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Share capital |
Share premium |
Share-based payment reserve |
Merger relief reserve |
Reverse acquisition reserve |
Warrant reserve |
Accumulated losses |
Total equity |
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£ |
£ |
£ |
£ |
£ |
£ |
£ |
£ |
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Balance as at 1 January 2020 |
5,516,759 |
23,283,880 |
734,365 |
6,508,673 |
(23,320,632) |
71,480 |
(9,183,725) |
3,610,800 |
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Comprehensive income for the period |
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|
|
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Loss and total comprehensive income for the year |
- |
- |
- |
- |
- |
- |
(3,116,002) |
(3,116,002) |
|||
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Total comprehensive expense |
- |
- |
- |
- |
- |
- |
(3,116,002) |
(3,116,002) |
|||
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Transactions with owners |
|
|
|
|
|
|
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|||
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Issue of shares |
712,500 |
4,987,500 |
- |
- |
- |
- |
- |
5,700,000 |
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Costs of raising equity |
- |
(294,183) |
- |
- |
- |
- |
- |
(294,183) |
|||
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Share-based payments |
- |
- |
301,273 |
- |
- |
- |
- |
301,273 |
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Total transaction with owners |
712,500 |
4,693,317 |
301,273 |
- |
- |
- |
- |
5,707,090 |
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|
|
|
|
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|||
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Balance as at 30 June 2020 |
6,229,259 |
27,977,197 |
1,035,638 |
6,508,673 |
(23,320,632) |
71,480 |
(12,299,727) |
6,201,888 |
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Consolidated statement of changes in equity
for the year ended 31 December 2020
| Share capital | Share premium | Share-based payment reserve | Merger relief reserve | Reverse acquisition reserve | Warrant reserve | Accumulated losses |
Total equity |
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| £ | £ | £ | £ | £ | £ | £ | £ |
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Balance as at 1 January 2020 | 5,516,759 | 23,283,880 | 734,365 | 6,508,673 | (23,320,632) | 71,480 | (9,183,725) | 3,610,800 | |
Comprehensive income for the period |
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|
|
|
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| |
Loss and total comprehensive income for the year | - | - | - | - | - | - | (6,395,177) | (6,395,177) | |
Total comprehensive expense | - | - | - | - | - | - | (6,395,177) | (6,395,177) | |
Transactions with owners |
|
|
|
|
|
|
|
| |
Issue of shares | 717,502 | 5,032,518 | - | - | - | - | - | 5,750,020 | |
Costs of raising equity | - | (331,682) | - | - | - | - | - | (331,682) | |
Share-based payments | - | - | 548,191 | - | - | - | - | 548,191 | |
Total transaction with owners | 717,502 | 4,700,836 | 548,191 | - | - | - | - | 5,966,529 | |
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|
|
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| |
Balance as at 31 December 2020 | 6,234,261 | 27,984,716 | 1,282,556 | 6,508,673 | (23,320,632) | 71,480 | (15,578,902) | 3,182,152 | |
Consolidated statement of cash flows
for the period ended 30 June 2021
|
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|
6 months ended 30 Jun 2021 |
6 months ended 30 Jun 2020 |
Year ended 31 Dec 2020 |
|
|
|
£ |
£ |
£ |
|
Cash flows from operating activities |
|
|
|
|
|
Loss before taxation |
|
(2,888,391) |
(3,116,002) |
(6,992,212) |
|
Adjustments for: |
|
|
|
|
|
Amortisation - Intangibles |
|
15,598 |
26,818 |
31,574 |
|
Amortisation - Right of use asset |
|
6,928 |
5,341 |
19,621 |
|
Depreciation |
|
9,442 |
6,162 |
13,021 |
|
Equity settled share-based payments |
|
215,270 |
301,273 |
548,191 |
|
Doubtful debts expense |
|
- |
- |
(19,265) |
|
Finance income |
|
(60) |
(2,352) |
(2,525) |
|
Finance expense |
|
160 |
700 |
1,179 |
|
|
|
(2,641,053) |
(2,778,060) |
(6,400,416) |
|
Changes in working capital |
|
|
|
|
|
(Increase)/decrease in trade and other receivables |
|
1,161,913 |
(329,453) |
(1,241,792) |
|
Increase/(decrease) in trade and other payables |
|
(143,231) |
490,343 |
1,457,069 |
|
Net cash used in operations |
|
(1,622,371) |
(2,617,169) |
(6,185,139) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flow from investing activities |
|
|
|
|
|
Investment in intangible assets |
|
- |
(6,000) |
(570) |
|
Investment in property, plant and equipment |
|
(22,331) |
(7,581) |
(19,033) |
|
Net cash flow (used in)/ generated from investing activities |
|
(22,331) |
(13,581) |
(19,603) |
|
|
|
|
|
|
|
Cash flow from financing activities |
|
|
|
|
|
Proceeds from issue of share capital |
|
- |
5,700,000 |
5,750,020 |
|
Cost of issue |
|
- |
(294,183) |
(331,682) |
|
Principal movement on lease liabilities |
|
(7,768) |
(7,878) |
(16,368) |
|
Interest received |
|
60 |
2,352 |
2,525 |
|
Interest paid on lease liabilities |
|
(160) |
(700) |
(1,179) |
|
Net cash generated from financing activities |
|
(7,868) |
5,399,591 |
5,403,316 |
|
|
|
|
|
|
|
|
|
|
|
|
|
(Decrease)/Increase in cash and cash equivalents in the period |
|
1,652,570 |
2,768,841 |
(801,426) |
|
|
|
|
|
|
|
Cash and cash equivalents at beginning of period |
|
2,347,114 |
3,148,540 |
3,148,540 |
|
|
|
|
|
|
|
Cash and cash equivalents at the end of the period |
694,544 |
5,917,381 |
2,347,114 |
|
Notes to the consolidated interim financial report
1 Summary of significant accounting policies
Basis of preparation
The Company is a public limited company which is admitted to trading on the AIM Market of the London Stock Exchange and is incorporated and domiciled in the UK. The address of the registered office is 201 Temple Chambers, 3-7 Temple Avenue, London, EC4Y 0DT. The registered number of the company is 04466195.
The consolidated interim financial report consolidates those of the Company and its trading subsidiary, Bidstack Limited (together the "Group"). The financial information presented in this interim report have been prepared using accounting policies that are expected to be applied in the preparation of the financial statements for the year ending 31 December 2021.
These policies are in accordance with International Financial Reporting Standards (IFRSs) and International Financial Reporting Interpretation Committee (IFRIC) interpretations as endorsed by the European Union ("IFRS-EU"), and those parts of the Companies Act applicable to companies reporting under IFRS.
The interim results have been prepared on a going concern basis which assumes that the Group will be able to continue trading for the foreseeable future. Although an operating loss has been reported for the reporting period and an operating loss is expected to be incurred in the 12 months subsequent to the date of this report, the Directors believe, having considered all available information, including the cash resources currently available to the Group and the Company's proven ability to raise further equity funds from its supportive shareholder base, that the Group will have sufficient funds to meet its expected committed and contractual expenditure for the foreseeable future. Thus, the Directors continue to adopt the going concern basis of accounting in preparing the interim financial report for the period ended 30 June 2021.
2 Summary of significant accounting policies
The accounting policies applied by the Group in this consolidated interim financial report are the same as those applied by the Group in its consolidated financial statements as at and for the year ended 31 December 2020.
3 Loss per share
Basic and diluted loss per share
The calculation of basic and diluted loss per share is based upon the loss of £2,888,391 (2020: loss of £3,116,002) and the weighted average number of ordinary shares in issue for the year of 388,374,057 (2020: 264,555,996).
The loss incurred by the Group means that the effect of any outstanding warrants and options would be considered anti-dilutive and is ignored for the purposes of the loss per share calculation.
4 Share capital and reserves
Allotted, called up and fully paid |
|
| Ordinary 0.5p shares | Share capital |
|
|
| No. | £ |
|
|
|
|
|
At 1 January 2020 |
|
| 244,873,646 | 5,516,759 |
|
|
|
|
|
|
|
|
|
|
Exercised warrants |
|
| 1,000,411 | 5,002 |
Exercised options |
|
| - | - |
Issue of shares |
|
| 142,500,000 | 712,500 |
Issue of consideration shares |
|
| - | - |
As at 31 December 2020 |
|
| 388,374,057 | 6,234,261 |
|
|
|
|
|
Issue of shares |
|
| - | - |
As at 30 June 2021 |
|
| 388,374,057 | 6,234,261 |
All ordinary shares are equally eligible to receive dividends and the repayment of capital and represent equal votes at meetings of shareholders.
5 Post balance sheet events
On 23 July 2021 the Company raised gross proceeds of £10.863m (before expenses).
A total of 488,157,516 new ordinary shares of 0.5 pence each in the capital of the Company were placed by Cenkos with institutional and other investors at a price of 2.0 pence per share, raising gross proceeds of approximately £9.763 million.
Certain directors of the Company and others have also subscribed for a total of 55,000,000 New Ordinary Shares at 2.0 pence per share raising further gross proceeds of £1.1 million.
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