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Alpha Growth PLC (ALGW)

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Monday 24 December, 2018

Alpha Growth PLC

Final Results

RNS Number : 4404L
Alpha Growth PLC
24 December 2018
 

Alpha Growth plc

 

("Alpha", or the "Company")

 

Final Results for the Year Ended 31 August 2018

 

 

Notes to Editors:

 

Specialist in Longevity Assets

Alpha Growth plc is a financial advisory business providing specialist consultancy, advisory and supplementary services to institutional and qualified investors globally in the multi-billion dollar market of longevity assets. Building on its well-established network, Alpha Growth has a unique position in the longevity asset services and investment business, as a listed entity with global reach. The Company's strategy is to expand its advisory and business services via acquisitions and joint ventures in the UK and the US to attain commercial scale and provide wholistic solutions to alternative institutional investors who are in need of specialised skills and unique access to deploy their financial resource in longevity assets.

 

The information communicated within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

 

For more information, please visit www.algwplc.com or contact the following:

 

Alpha Growth

+44 (0) 20 3959 8600

Gobind Sahney

[email protected]

 

 

Novum Securities Limited (Corporate Broker)

+44 (0) 207 399 9400

Colin Rowbury

[email protected]

 

 

 

 

Chairman's Statement 

 

I am pleased to present the annual accounts for the year ended 31 August 2018. During the year the Company reported a loss of £481,707 (2017 - loss of £5,670) which arose predominantly from the IPO costs and the foundational year we have experienced in 2018. As at the date of this report the Company has approximately £237,077 of cash balances.

 

In 2018 we have established the Company's name within the longevity asset sector, specifically in Life Settlements, as a specialist advisor that institutions, family offices, and other global investors can access. Shortly after the IPO we launched the Hybrid product that we developed in coordination with one of the big four accounting firms and presented to the top ten UK insurance companies for consideration. The Hybrid is a nine-figure allocation that is designed for long term investors providing an uncorrelated yield.

 

We have also attracted the services and commitments of leading industry professionals that will contribute to the success of the Company. These professionals include capital introduction firms, such as Devonshire Warwick, who are intimately knowledgeable of the investor markets for Life Settlements, experts in actuarial sciences, and Life Settlement asset experts. This includes the appointment of Danny Swick as our COO, who brings considerable transaction experience and industry relationships to the Company.

 

A significant endorsement of our efforts and acknowledgement of our qualifications, is our joint venture with SL Investment Management. The joint venture will see the launch of an open-ended fund that will commence with committed capital and will be evergreen for many years to come.  These are few of the highlights for 2018 and we look forward to adding to this list in 2019.

 

In the coming year, we look to build on these achievements, attract word class partners, generate revenues, and keep our operating costs low.  I am very excited about our prospects with the team we are putting together to generate returns for our shareholders.

 

I would like to thank all those who have contributed to bringing the Company to its present position and look forward to a successful future.

 

 

Gobind Sahney

Executive Chairman

 

21 December 2018

 

 

 

 

 

Independent Auditors' Report to the Members of Alpha Growth Plc

 

Opinion

We have audited the financial statements of Alpha Growth Plc (the 'company') for the year ended 31 August 2018 which comprise the Statement of Comprehensive Income, the Statement of Financial Position, the Statement of Changes in Equity, the Statement of Cash Flows and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and International Financial Reporting Standards (IFRSs) as adopted by the European Union.

In our opinion, the financial statements:

·    give a true and fair view of the state of the company's affairs as at 31 August 2018 and of its loss for the year then ended;

·    have been properly prepared in accordance with IFRSs as adopted by the European Union; and

·    have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard as applied to listed public interest entities, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Material uncertainty related to going concern

We draw attention to note 2 in the financial statements concerning the Company's ability to continue as a going concern. The company incurred a loss of £481,707 during the year ended 31 August 2018, and at that date the net asset position was £81,680.

 

The Company is not yet revenue generating and is reliant on raising additional capital to secure future revenue streams in order to meet the financial obligations of the Company as they fall due and continue as a going concern.

 

As stated in note 2, these events or conditions indicate that a material uncertainty exists that may cast significant doubt on the company's ability to continue as a going concern.

 

Our opinion is not modified in respect of this matter.

Our application of materiality

The scope of our audit was influenced by our application of materiality. The quantitative and qualitative thresholds for materiality determine the scope of our audit and the nature, timing and extent of our audit procedures. Materiality was set at £9,000 based on a blended average of 3% of loss before tax and 5% of net assets.

An overview of the scope of our audit

As part of designing our audit we determined materiality, as above, and assessed the risk of material misstatement in the financial statements. In particular, we looked at areas involving significant accounting estimates and judgements by the directors and considered future events that are inherently uncertain. As in all our audits, we also addressed the risk of management override of internal controls, including evaluating whether there was evidence of bias by the directors that represented a risk of material misstatement due to fraud.

Key audit matters

Except for the matter described in the Material uncertainty related to going concern section, we have determined that there are no other key audit matters to communicate in our report.

Other information

The other information comprises the information included in the annual report, other than the financial statements and our auditors' report thereon. The directors are responsible for the other information. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion the part of the remuneration committee report to be audited has been properly prepared in accordance with the Companies Act 2006.

In our opinion, based on the work undertaken in the course of the audit:

·     the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

·     the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

·     adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or

·     the financial statements and the part of the directors' remuneration report to be audited are not in agreement with the accounting records and returns; or

·     certain disclosures of directors' remuneration specified by law are not made; or

·     we have not received all the information and explanations we require for our audit.

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditors' responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors' report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities.This description forms part of our auditors' report.

Other matters which we are required to address

We were appointed by the Audit Committee on 30 November 2018 to audit the financial statements for the year ended 31 August 2018. Our total uninterrupted period of engagement is one year, covering the year ended 31 August 2018.

The non-audit services prohibited by the FRC's Ethical Standard were not provided to the Company and we remain independent of the group and the parent company in conducting our audit.

We identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our sector experience and through discussion with the Directors. We considered the extent of compliance with those laws and regulations as part of our procedures on the related financial statements items.

We communicated laws and regulations throughout our audit team and remained alert to any indications of non-compliance throughout the audit.

As with any audit, there remained a higher risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls.

Our audit opinion is consistent with the additional report to the audit committee.

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006.  Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditors' report and for no other purpose.  To the fullest extent permitted by law, we do not accept or assume responsibility to anyone, other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

 

 

Joseph Archer (Senior Statutory Auditor)

 

For and on behalf of

PKF Littlejohn LLP

 

Statutory Auditor

 

1 Westferry Circus

Canary Wharf

London

E14 4HD

 

21 December 2018

 

 

 

 

 

Statement of Comprehensive Income

 

 

 

Year ended

31 August 2018

Year ended

31 August 2017

 

Note

£

£

Continuing operations

 

 

 

 

 

 

 

Operating expenses

3

(479,995)

(5,677)

 

 

 

 

Operating loss

 

(479,995)

(5,677)

 

 

 

 

Interest income

 

-

7

Interest expense

 

(1,712)

-

 

 

 

 

 

Loss before taxation

 

 

 

(481,707)

 

(5,670)

 

 

 

 

Taxation

5

-

-

 

Loss for the year

 

 

(481,707)

 

(5,670)

 

 

 

 

Other comprehensive income for the year

 

-

-

 

 

 

 

Total comprehensive loss for the year attributable to the equity owners

 

 

 

(481,707)

 

 

(5,670)

 

 

 

 

Earnings per share from continuing operations attributable to the equity owners

 

 

 

 

Basic and diluted earnings per share (pence per share)

 

6

 

(0.05p)

 

(0.01p)

                        

The notes to the financial statements form an integral part of these financial statements.

 

 

 

Statement of Financial Position

 

 

                                                           

 

As at

31 August 2018

As at

31 August 2017

 

Note

£

£

Assets

 

 

 

Current assets

 

 

 

Trade and other receivables

7

32,653

10,428

Cash and cash equivalents

8

107,083

1,726

 

 

 

 

Total current assets

 

139,736

12,154

Total assets

 

139,736

12,154

 

 

 

 

Equity and liabilities

 

 

 

 

Equity attributable to shareholders

 

 

 

Share capital

Share premium

9

9

106,335

561,898

50,085

60,915

Retained deficit

 

(586,553)

(104,846)

 

 

 

 

Total equity

 

81,680

6,154

 

 

 

 

Liabilities

 

 

 

 

 

 

 

Current liabilities

 

 

 

Trade and other payables

10

58,056

6,000

 

 

 

 

Total liabilities

 

58,056

6,000

 

 

 

 

Total equity and liabilities

 

139,736

12,154

 

                                               

The notes to the financial statements form an integral part of these financial statements.

 

This report was approved by the board and authorised for issue on 21 December 2018 and signed on its behalf by:

 

Rory Heier

Finance Director

Company Registration Number: 09734404

 

 

 

Statement of Changes In Equity

 

Share capital

Share premium

Retained deficit

Total

 

£

£

£

£

 

 

 

 

 

Balance as at 1 September 2016

50,085

60,915

(99,176)

11,824

 

 

 

 

 

Loss for the year

-

-

(5,670)

(5,670)

Total comprehensive loss for the year

-

-

(5,670)

(5,670)

 

 

 

 

 

Balance as at 31 August 2017

50,085

60,915

(104,846)

6,154

 

Loss for the year

-

-

(481,707)

(481,707)

Total comprehensive loss for the year

-

-

(481,707)

(481,707)

 

 

 

 

 

 

Share based payments

1,250

13,750

-

15,000

Share issue net of costs

55,000

487,233

-

542,233

 

 

 

 

 

Balance as at 31 August 2018

106,335

561,898

(586,553)

81,680

 

Share capital comprises the ordinary issued share capital of the Company.

 

Share premium represents consideration less nominal value of issued shares and costs directly attributable to the issue of new shares.

 

Retained deficit represents the cumulative retained losses of the Company at the reporting date.

 

The notes to the financial statements form an integral part of these financial statements.

 

 

Statement of Cash Flows

 

 

     

 

Year ended

31 August 2018

Year ended

31 August 2017

 

Note

£

£

Cash flow from operating activities

 

 

 

Loss before taxation

Adjustments for:

Share-based payment

Interest received                                            

 

(481,707)

 

15,000

-

(5,670)

 

-

(7)

 

 

 

 

Changes in working capital

 

 

 

Increase in trade and other receivables

 

(20,225)

-

Increase in trade and other payables

 

52,056

3,000

 

 

 

 

Net cash used in operating activities

 

(436,876)

(2,677)

 

 

 

 

Cash flows from financing activities

 

 

 

 

 

 

 

Proceeds from issuance of shares net of issue costs

 

542,233

-

 

 

 

 

Net cash generated from financing activities

   11

542,233

-

 

 

 

 

Cash flows from investing activities

 

-

-

 

 

 

 

Interest received

 

-

7

 

 

 

 

Net cash (used in)/ generated from investing activities

 

-

7

 

 

 

 

 

 

 

 

Increase/(decrease) in cash and cash equivalents

 

105,357

(2,670)

 

 

 

 

Cash and cash equivalents at beginning of period

 

1,726

4,396

 

 

 

 

Cash and cash equivalents at end of period

8

107,083

1,726

 

 

 

The notes to the financial statements form an integral part of these financial statements.

 

 

 

 

Notes to the Financial Statements

 

1.      General Information

 

The Company's principal activity is to seek acquisitions and opportunities to provide advisory services, strategies, performance monitoring and analytical services to existing and prospective holders of Senior Life Settlements (SLS) Assets, mainly through acquisition strategies, performance monitoring and analytical services. The Company will only advise on the United States SLS market.

 

The Company is incorporated and domiciled in England and Wales as a public limited company and operates from its registered office is 30 Percy Street, London W1T 2DB, and is listed on the London Stock Exchange on the standard segment.

 

2.      Summary of Significant Accounting Policies

 

The principle accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

 

a)    Basis of Preparation

 

The financial statements of Alpha Growth Plc have been prepared in accordance with International Financial Reporting Standards ("IFRS") and IFRS Interpretations Committee (IFRS IC) interpretations as adopted for use by the European Union, and the Companies Act 2006.

 

The financial statements have been prepared under the historical cost convention.

 

b)      New Standards and Interpretations

 

i. New and amended standards adopted by the Company

 

No new standards, amendments or interpretations, effective for the first time for the financial year beginning on or after 1 September 2017 have had a material impact on the Company.

 

ii.       New standards, amendments and Interpretations in issue but not yet effective or not yet endorsed and not early adopted

 

The standards and interpretations that are issued, but not yet effective and (in some cases) have not yet been endorsed by the EU, up to the date of issuance of the financial statements are listed below. The Company intend to adopt these standards, if applicable, when they become effective. 

 

Standard

Impact on initial application

Effective date

 

IFRS 9

Financial Instruments

1 January 2018

IFRS 15

Revenue from contracts with customers

1 January 2018

IFRS 2 (Amendments)

Share-based payments - classification and measurement

1 January 2018

Annual improvements

IFRIC Interpretations 22

IFRIC 23

 

Annual improvements

IFRS 3 (Amendments)

IAS 1 and IAS 8 (Amendments)

 

 

Subject to EU endorsement

 

The Directors are evaluating the impact of the new and amended standards above. The Directors believe that these new and amended standards are not expected to have a material impact on the financial statements of the Company, this has been considered in more detail for certain Standards below:

 

IFRS 9, 'Financial instruments', addresses the classification, measurement and recognition of financial assets and financial liabilities. The complete version of IFRS 9 was issued in July 2014. It replaces the guidance in IAS 39 that relates to the classification and measurement of financial instruments. IFRS 9 retains but simplifies the mixed measurement model and establishes three primary measurement categories for financial assets: amortised cost, fair value through OCI and fair value through P&L. The basis of classification depends on the entity's business model and the contractual cash flow characteristics of the financial asset. Investments in equity instruments are required to be measured at fair value through profit or loss with the irrevocable option at inception to present changes in fair value in OCI not recycling. There is now a new expected credit losses model that replaces the incurred loss impairment model used in IAS 39. For financial liabilities there were no changes to classification and measurement except for the recognition of changes in own credit risk in other comprehensive income, for liabilities designated at fair value through profit or loss. IFRS 9 relaxes the requirements for hedge effectiveness by replacing the bright line hedge effectiveness tests. It requires an economic relationship between the hedged item and hedging instrument and for the 'hedged ratio' to be the same as the one management actually use for risk management purposes. Contemporaneous documentation is still required but is different to that currently prepared under IAS 39. The standard is effective for accounting periods beginning on or after 1 January 2018 but early adoption is permitted.

 

At the year end, the Company only held basic financial instruments including loans and receivables and other liabilities measured at amortised cost. Because of this, the Directors do not consider IFRS 9 will have an impact on the financial statements except for disclosure.

 

IFRS 15, 'Revenue from contracts with customers' deals with revenue recognition and establishes  principles for reporting useful information to users of financial statements about the nature, amount, timing and uncertainty of revenue and cash flows arising from an entity's contracts with customers. Revenue is recognised when a customer obtains control of a good or service and thus has the ability to direct the use and obtain the benefits from the good or service. The standard replaces IAS 18 'Revenue' and IAS 11 'Construction contracts' and related interpretations. The standard is effective for annual periods beginning on or after 1 January 2018 and earlier application is permitted.

 

At the year-end, and at the date of the approval of the financial statements, no revenue has been generated. The Directors do not consider IFRS 15 will have an impact on the financial statements, however this will be dependent on the nature of any future acquisition made by the Company.

 

There are no other IFRSs or IFRIC interpretations that are not yet effective that would be expected to have a material impact on the Company.

 

c)    Going Concern

 

The preparation of the financial statements requires an assessment on the validity of the going concern assumption.

 

The Directors have reviewed projections for a period of at least 12 months from the date of approval of the financial statements. The Company has no revenue, but cash resources were raised, at the time of its listing, to finance its activities whilst it identifies and completes suitable transaction opportunities. The Company will need to raise additional funds in order to meet its working capital needs during the going concern period.

 

In making their assessment of going concern, the Directors acknowledge that the Company has a very small cost base and can therefore confirm that they consider sufficient funds will be available to ensure the Company continues to meet its obligations they fall due for a period of at least one year from the date of approval of these financial statements. Accordingly, the Board believes it is appropriate to adopt the going concern basis in the preparation of the financial statements.

 

The auditors have made reference to going concern by way of a material uncertainty within their audit report.

 

 

d)    Foreign Currency Translation

 

iii.       Functional and Presentation Currency

 

The financial statements are presented in Pounds Sterling (£), which is the Company's functional and presentation currency.

 

iv.      Transactions and Balances

 

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions or valuation where items are re-measured. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the income statement.

 

e)    Significant accounting judgements, estimates and assumptions

 

The preparation of the financial statements in conformity with International Financial Reporting Standards 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.

 

Estimates and judgements are continually evaluated, and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the financial statements for the year ended 31 August 2018 are discussed below:

 

Recoverability of loan balances

 

Included in debtors is a loan balance of £9,063 due from Alpha Longevity Management Limited. The relationship between the Company and Alpha Longevity Management Limited is set out in note 17. This balance arose as a result of the Company paying expenses on behalf of Alpha Longevity Management Limited during the year. The recovery of this balance is reliant on Alpha Longevity Management Limited becoming revenue generating in the future. The Directors do not consider this debtor balance to be impaired.

 

 

f)     Financial Instruments

 

Financial assets and liabilities are recognised in the Company's statement of financial position when the Company becomes a party to the contractual provisions of the instrument. The Company currently does not use derivative financial instruments to manage or hedge financial exposures or liabilities.

 

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market.  They are included in current assets, except for maturities greater than 12 months after the end of the reporting period.  These are classified as non-current assets. The Company's loans and receivables comprise Trade and Other Receivables and Cash and Cash Equivalents in the Statement of Financial Position.

 

g)   Trade and Other Receivables and Payables

 

Trade and other receivables are amounts due from customers for merchandise sold or services performed in the ordinary course of business.  If collection is expected in one year or less (or in the normal operating cycle of the business if longer), they are classified as current assets. If not they are presented as non-current assets.

 

Trade and other receivables are recognised initially at fair value, and subsequently measured at amortised cost using the effective interest method, less provision for impairment.

 

Other liabilities measured at amortised cost are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers.  The liabilities are classified as current liabilities if payment is due within one year or less (or in the normal operating cycle of the business if longer.  If not, they are presented as non-current liabilities.

 

The liabilities are recognised initially at fair value, and subsequently measured at amortised cost using the effective interest method.

 

h)    De-recognition of Financial Instruments

 

i. Financial Assets

 

A financial asset is derecognised where:

 

· the right to receive cash flows from the asset has expired;

· the Company retains the right to receive cash flows from the asset, but has assumed an obligation to pay them in full without material delay to a third party under a pass-through arrangement; or

· the Company has transferred the rights to receive cash flows from the asset, and either has transferred substantially all the risks and rewards of the asset or has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

 

ii.       Financial Liabilities

 

A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. Where an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as a derecognition of the original liability and the recognition of a new liability, and the difference in the respective carrying amounts is recognised in the statement of comprehensive income.

 

i)     Taxation

 

Current Tax

 

Current tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid to the tax authorities. The tax rates and the tax laws used to compute the amount are those that are enacted or substantively enacted by the statement of financial position date.

 

Deferred Tax

 

Deferred income tax is recognised on all temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements, with the following exceptions:

 

·     where the temporary difference arises from the initial recognition of goodwill or of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither accounting nor taxable profit or loss;

·     in respect of taxable temporary differences associated with investment in subsidiaries, associates and joint ventures, where the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future; and

·     deferred income tax assets are recognised only to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, carried forward tax credits or tax losses can be utilised.

 

Deferred income tax assets and liabilities are measured on an undiscounted basis at the tax rates that are expected to apply when the related asset is realised or liability is settled, based on tax rates and laws enacted or substantively enacted at the statement of financial position date.

 

The carrying amount of deferred income tax assets is reviewed at each statement of financial position date.  Deferred income tax assets and liabilities are offset, only if a legally enforcement right exists to set off current tax assets against current tax liabilities, the deferred income taxes related to the same taxation authority and that authority permits the Company to make a single net payment.

 

Income tax is charged or credited directly to equity if it relates to items that are credited or charged to equity. Otherwise income tax is recognised in the statement of comprehensive income.

 

j)     Segmental Reporting

 

At this point, identifying and assessing investment projects is the only activity the Company is involved in and is therefore considered as the only operating/reportable segment.

 

Therefore the financial information of the single segment is the same as that set out in the Company statement of comprehensive income, Company statement of financial position, the Company statement of changes to equity and the Company statement of cashflows.

 

k)    Share-based payments

 

The cost of equity settled transactions are recognised, together with any corresponding increase in equity, in the period during which the service was provided. Equity settled share based payment transactions with other parties are measured at the fair value of of the services provided. The corresponding expense is recognised in the Statement of Comprehensive Income. Details of equity settled transactions can be found in note 9.

 

l)     Financial Risk Management Objectives and Policies

 

The Company does not enter into any forward exchange rate contracts.

 

The main financial risks arising from the Company's activities are market risk, interest rate risk, foreign exchange risk, credit risk, liquidity risk and capital risk management. Further details on the risk disclosures can be found in Note 14.

 

m)   Equity

 

Equity instruments issued by the Company are recorded at the value of net proceeds after direct issue costs.

 

n)    Cash and Cash Equivalents

 

Cash and cash equivalents comprise cash held in bank.  This definition is also used for the Statement of Cash Flows.

 

The Company considers the credit ratings of banks in which it holds funds in order to reduce exposure to credit risk. The Company only keeps its holdings of cash and cash equivalents with institutions which have a minimum credit rating of 'A-'.

 

The Company considers that it is not exposed to major concentrations of credit risk.

 

 

3.      Expenses by Nature

 

 

Year ended

31 August

2018

Year ended

31 August

2017

 

£

£

      Salaries and wages (Note 13)

218,284

-

      Audit fees

15,000

3,000

      Professional and consultancy fees

161,402

-

      Other expenses

85,309

2,677

 

 

 

      Operating expenses

479,995

5,677

 

 

4.      Auditors Remuneration

 

 

 

Year ended

31 August

2018

Year ended

31 August

2017

 

£

£

 

 

 

         Fees payable to the Company's current auditor for the audit of           the Company's annual accounts:

15,000

-

 

 

Year ended

31 August

2018

Year ended

31 August

2017

 

£

£

 

 

 

  Fees payable to the Company's former auditor for the audit of      the Company's annual accounts:

-

3,000

 

 

5.      Income tax

 

Analysis of charge in the year

 

Year ended

31 August

2018

Year ended

31 August

2017

 

 

£

£

 

 

 

 

 

Current tax expense

-

-

 

Deferred tax expense

-

-

 

 

 

 

 

Income tax expense

-

-

 

 

 

 

Loss on ordinary activities before tax

(481,707)

(5,670)

 

 

 

Analysis of charge in the year

 

 

Loss on ordinary activities multiplied by rate of corporation tax in the UK of 19% (2017: 19.6%)

(91,524)

(1,134)

 

Tax losses carried forward

91,524

1,134

 

 

 

Total tax charge for the year

-

-

 

 

 

 

 

 

         

The change in the applicable tax rate from the previous year is a result of change in legislation in the UK.

 

The company has accumulated tax losses of approximately £546,553 (2017: £64,846) that are available, under current legislation, to be carried forward indefinitely against future profits.

 

A deferred tax asset has not been recognised in respect of these losses due to the uncertainty of future profits. The amount of the deferred tax asset not recognised is £103,845 (2017: £12,321).

 

 

6.      Earnings per share

 

The calculation of the basic and diluted earnings per share is calculated by dividing the loss for the year from continuing operations of £481,707 (2017: £5,670) for the Company by the weighted average number of ordinary shares in issue during the year of 89,557,603 (2017: 50,085,000):

 

 

2018

2017

 

£

£

Loss for the year from continuing operations

(481,707)

(5,670)

 

 

 

Weighted average number of shares in issue

89,557,603

50,085,000

 

 

 

Basic and diluted earnings per share

(0.05p)

(0.01p)

 

As at 31 August 2018 and 31 August 2017, there were no warrants or options outstanding therefore the basic and diluted earnings per share are the same.

 

Details of post year end share issues are included in note 18.

 

 

7.      Trade and other receivables

 

 

As at

31 August

2018

As at

31 August

2017

 

£

£

 

  Other receivables

  Loans

  Prepayments

 

16,923

9,063

6,667

 

 

10,428

-

-

 

 

32,653

10,428

 

There are no material differences between the fair value of trade and other receivables and their carrying value at the year end.

 

No receivables were past due or impaired at the year end.

 

The loans due are interest free, unsecured and repayable on demand.

 

 

8.      Cash and cash equivalents  

 

 

As at

31 August
2018

As at

31 August

2017

 

£

£

   Cash at bank

107,083

1,726

 

 

 

 

107,083

1,726

 

The Directors consider the carrying amount of cash and cash equivalents approximates to their fair value.

 

 

9.      Called up share capital

 

 

As at 1 September 2016 and 31 August 2017 the Company's issued and outstanding capital structure comprised 50,085,000 shares and there were no other securities in issue and outstanding.

 

On 22 December 2017, in settlement of costs totalling £15,000 incurred for PR services, the Company issued 1,250,000 shares of £0.001 for £0.012 per share.

 

On 22 December 2017 the Company issued 55,000,000 shares of £0.001 for a consideration of £0.012 per share.

 

As at 31 August 2018 the Company had 106,335,000 allotted and fully paid ordinary shares.

 

The ordinary shares have attached to them full voting, dividend and capital distribution rights (including on a winding up). The ordinary shares do not confer any rights of redemption.

 

 

Number of

Ordinary Shares of £0.001 each

 

Share Capital £

Share Premium

£

 

 

 

 

 

As a1 September 2016 and 31 August 2017

50,085,000

 

50,085

60,915

 

 

 

 

 

Share issue

55,000,000

 

55,000

605,000

Settlement of fees

1,250,000

 

1,250

13,750

Share issue costs

-

 

 

-

(117,767)

At 31 August 2018

106,335,000

 

106,335

561,898

 

 

10.    Trade and other payables

 

As at

31 August 2018

As at

31 August 2017

 

£

£

 

 

 

Trade payables

30,056

-

Accruals

28,000

6,000

 

 

 

 

58,056

6,000

 

 

11.    Reconciliation of liabilities arising from financing activities

 

No reconciliation of liabilities arising from financing activities has been presented as there are no liabilities in relation to financing activities as at 31 August 2017 and 31 August 2018.

 

 

12.    Related party disclosures

 

The transactions with Directors have been included in in the remuneration table in Note 13.

 

Directors fees paid to Gobind Sahney were paid to Argus Global Limited ("Argus Global"). During the year, the Company was invoiced £nil (2017: £2,651) by Argus Global Limited in relation to ordinary business expenses incurred by director and shareholder, Gobind Sahney. Argus Global is connected by way of Mr Sahney's directorship and major shareholding in Argus Global. There were no balances outstanding between the Company and Argus Global at 31 August 2018 (2017: £nil).

 

Directors fees paid to Daniel Swick were paid to Kango Group LLC ("Kango Group"). Kango Group is connected by way of Mr. Swick's directorship and major shareholding in Kango Group. There were no balances outstanding between the Company and Kango Group at 31 August 2018 (2017: £nil).

 

During the year, the Company was invoiced £4,639 (2017: £nil) by GO Management Ltd in relation to ordinary business expenses incurred by director and shareholder, Gobind Sahney. GO Management Ltd is connected by way of Mr. Sahney's directorship and major shareholding in GO Management Ltd.  There were no balances outstanding between the Company and GO Management Ltd at 31 August 2018 (2017: £nil).

 

During the year, the Company paid fees of £9,063 (2017: £nil) on behalf of Alpha Longevity Management Limited. Alpha Longevity Management Limited is connected by way of Mr. Sahney's directorship and major shareholding. Further details of the relationship between the Company and Alpha Longevity Management Limited is set out in note 18. At the year end the Alpha Longevity Management Limited owed the Company £9,063 (2017: £nil). This balance is interest free, unsecured and repayable on demand.

 

 

13.    Directors' emoluments

 

Details concerning Directors' remuneration can be found below. The Directors are considered to be the key management.

 

 Name of Director

 

 

 

Directors Fees

 

Other

Total

 Andrew Dennan

 

 

 

44,583

-

44,583

 Gobind Sahney

 

 

 

66,731

-

66,731

 Rory Heier

 

 

 

39,750

-

39,750

 Daniel Swick

 

 

 

67,219

-

67,219

 

 

 

 

 

 

 

 Total

 

 

 

218,284

-

218,284

 

Further information concerning Directors' remuneration can be found in the Remuneration Committee Report.

 

 

14.    Financial instruments

 

The following table sets out the categories of financial instruments held by the Company as at the year ended 31 August 2018 and 31 August 2017:

 

 

2018

2017

 

£

£

Financial Assets

 

 

 

 

 

Loans and receivables - Cash and cash equivalents

107,083

1,726

Loans and receivables - Trade and other receivables

16,923

10,428

Loans and receivables - Loans

9,063

 

 

 

Financial liabilities

 

 

 

 

 

Financial liabilities measured at amortised cost - Trade and other payables

58,056

6,000

 

a)      Market risk

 

         The Company is not materially exposed to Market risk yet as it has yet to commence trading. Market risk is the risk that changes in market prices, such as foreign exchange rates and interest rates will affect the Company's income or value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising the return on risk.

 

b)      Interest rate risk

 

         The Company is not materially exposed to interest rate risk because it does not have any funds at either fixed or floating interest rates.

 

c)      Foreign currency risk

 

         The Company is not currently materially exposed to foreign currency risk.

 

d)      Credit risk

 

         The Company's maximum exposure to credit risk in relation to each class of recognised asset is the carrying amount of those assets as indicated in the balance sheet. At the reporting date, there was no significant concentration of credit risk. Receivables at the year-end were not past due, and the Directors consider there to be no significant credit risk arising from these receivables.

 

e)      Liquidity risk

 

Cash flow working capital forecasting is performed for regular reporting to the directors. The directors monitor these reports and forecasts to ensure the Company has sufficient cash to meet its operational needs.

 

f)       Capital risk management

 

The Company defines capital based on the total equity of the Company. The Company manages its capital to ensure that the Company will be able to continue as a going concern while maximising the return to stakeholders through the optimisation of the debt and equity balance.

 

In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt, in the future.

 

 

15.    Average number of people employed

 

 

Average number of people employed, including Directors:

 

 

2018

2017

 

 

Number

Number

 

Office and management

4

3

 

 

16.    Ultimate Controlling Party

 

The Directors have determined that there is no controlling party as no individual shareholder holds a controlling interest in the Company.

 

 

17.    Business Combinations

 

On 18 July 2018, the Company entered into an agreement to acquire 100% of the share capital of Alpha Longevity Limited, a Company incorporated in the British Virgin Islands, for consideration of £1. As at 31 August 2018, the conditions attached to this acquisition had not been fulfilled and the Company is therefore deemed not to be in control of Alpha Longevity Limited for this financial year. As a result, Alpha Longevity Limited has not been recognised as a subsidiary.

 

 

18.    Post balance sheet events

 

On 17 September 2018, the Company issued 20,000,000 ordinary shares of 0.1p each at a placing price of 2p per placing share. The shares rank pari passu in all respects of the existing ordinary shares.

 

On 21 November 2018, the Company signed Heads of Terms with SL Investment Management Limited ("SLIM"), a UK based full scope FCA regulated alternative investment fund manager, to launch an Open-Ended Fund investing in life settlements. The Fund is expected to launch in the first quarter of 2019 and has a minimum seed commitment of $10 million USD conditional on the launch. The Company and SLIM are co-advisors, with SLIM as the regulated manager.

 

On 5 September 2018, Policy Acquisition & Conveyance LLC (company number 7045758), a 100% owned subsidiary of the Company, was incorporated in the United States.

 

 

19.    Copies of the Annual Report

 

Copies of the annual report will be available on the Company's website at http://algwplc.com and from the Company's registered office, 30 Percy Street, London W1T 2DB.

 

 


This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [email protected] or visit www.rns.com.
 
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