Results for the year ended 31 October 2024
The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain
29 July 2025
Minoan Group Plc
("Minoan", the "Group" or the "Company")
Results Announcement
Minoan Group Plc announces its results for the year ended 31 October 2024
The Directors are pleased to confirm that Minoan Group Plc's Report and Financial Statements for the year ended 31 October 2024 were submitted in time to meet the filing extension deadline set by Companies House.
Project Highlights
· Impasse with the Project landlord the Foundation Panagia Akrotiriani.
· Recently appointed Greek advisory team ended their relationship with Minoan Group Plc in December 2024 following non-payment.
· The last face-to-face meeting between Directors of the Company and the Board Members of the Foundation took place on 18 June 2024.
Financial Highlights
· The Board has decided that the Company is not a going concern.
· The Company's only cash resources are those made available to it by DAGG LLP.
· Due to uncertainty, the auditors have not expressed an opinion on the financial statements.
· The Group made a loss for the year, after taxation of £47,294,000 (2022/23: £529,000).
· The loss includes an impairment of inventories of £42,521,000 (2022/23: £Nil).
· Net assets / liabilities decreased to Liabilities of £4,174,000; (2023: Assets £42,190,000).
Timothy Hill, Independent Director of Minoan, said:
"The relationship with the Foundation has reached an impasse. In the Annual Report and Accounts for the year ended 31 October 2024, I have endeavoured to be as transparent as possible on this matter as well as on the liquidity and solvency issues confronting the Company.
Throughout the audit process, I ensured that a "Chinese Wall" was maintained between Nicholas Day and the other members of DAGG LLP. He is now free to have further discussions with them. To protect the interests of all stakeholders, Nicholas and the other DAGG LLP members must, as soon as reasonably possible, formalise an offer. A week from the publication of these results would appear to be a reasonable deadline. Should DAGG LLP fail to do so, it is the view of the Board that Minoan Group Plc will enter an insolvency process".
Trading in the Company's shares on AIM will remain suspended pending clarification of the Company's financial position and the outcome of discussions with members of DAGG LLP referred to in this announcement.
Minoan Group Plc's Report and Financial Statements for the year ended 31 October 2024 can be viewed on the Company's website with effect from 29 July 2025.
|
For further information visit www.minoangroup.com or contact:
Minoan Group Plc
Nicholas Day nicholas.day@minoangroup.com
Zeus 020 3829 5000
Antonio Bossi / Andrew de Andrade
Peterhouse Capital Limited 020 7469 0930
Duncan Vasey
Director's Statement - T R C Hill
Introduction
No Chairman's Statement had been shared with the Board of Directors or auditors ahead of the six-month audit deadline (30 April 2025) or before the former Chairman's resignation on 23 May 2025. Therefore, I have written in my capacity as the only director present during the fiscal year in question who remains in place to this day.
Financial Review
Minoan Group Plc recorded no net revenues in the year ending 31 October 2024. Operating costs increased by £122,000, being 23% higher versus the prior year. Almost all of this was accounted for by the increase in the salary of the then Chairman, Christopher Egleton, which rose by £120,000 from £60,000 to £180,000 for the year.
There was a noteworthy increase in Finance Costs in respect of Other interest/fees, which increased from £4,000 in the year ended 31 October 2023 to £178,000 in the year ended 31 October 2024, as a result of the premium payable in respect of the extension of the repayment date of the loan from DAGG LLP.
The loss before taxation for the year was £47,294,000 compared to £529,000 recorded for the year to 31 October 2023. Aside from the significant increase in operating costs and impairment charge, there was no offset from a reduction in the Fair Value of Warrants issued this fiscal year. In the prior fiscal year, a reduction in the Fair Value of Warrants had lowered losses by £158,000. As discussed further in the Directors' statements, after the year end, the Directors undertook an impairment review of the Itanos Gaia Project at Cavo Sidero in Crete (the "Project"). The review led to an impairment of £42,521,000 of the inventories held in the balance sheet, reducing the carrying value, determined on a net recoverable basis, to £6,100,000.
Throughout the fiscal year, ordinary shares of 1p each ("Ordinary Shares") were issued to settle certain liabilities. At the Company's General Meeting, held on 10 November 2023, Resolution 1 seeking authorisation to settle £707,231 of the Secured Loan outstanding to DAGG LLP by the issue of shares, was duly passed. A total of 70,723,100 new Ordinary Shares were admitted to trading in AIM ("Admission") from 15 November 2023. Loan interest increased to £196,000 from £147,000 in the year to 31 October 2023. On 14 February 2024, 7,500,000 new Ordinary Shares were admitted to trading on AIM to settle certain liabilities. On 3 May 2024, 14,767,467 new Ordinary Shares were admitted to trading on AIM to settle certain liabilities.
Board and Management
On 7 March 2024, Professor George Mergos resigned as a Director of Minoan Group Plc and Chairman of Loyalward Limited, the Group's wholly owned subsidiary. No successor to either role was appointed. Instead, a new external Greek advisory team bringing additional legal support for the negotiations with the Foundation was appointed. That team remained in place until December 2024.
On 30 April 2025, Grahame Cook failed to be re-elected as a Director of Minoan Group Plc.
On 16 May 2025, Nicholas Day was appointed a Director of Minoan Group Plc.
On 23 May 2025, Christopher Egleton, Chairman, resigned as Director of Minoan and its subsidiary companies.
At the Company's Annual General Meeting, held on 30 April 2024, Resolution1 was adjourned and Resolution3 in respect of the re-election of Grahame Cook as a director of Minoan Group Plc was defeated. All other resolutions at that meeting were passed. Minoan Group Plc's Annual Report and Accounts for the fiscal year ended 31 October 2023 were not published ahead of the AGM of 30 April 2024 or on the day of the meeting itself.
The Company's Nominated Adviser and Broker changed to Zeus Capital Limited on 12 September 2024. This change followed the acquisition by Zeus Capital Limited of the WH Ireland Capital Markets Division (from WH Ireland Limited).
Director's Statement - T R C Hill (continued)
Outlook
Minoan Group Plc's accounts for the year ended 31 October 2024 were prepared on a break-up basis given insufficient liquidity and the impairment of the Itanos Gaia site valuation resulting in the Company having negative shareholder funds. The Company will enter an insolvency process should the indicative proposal from DAGG LLP fail to advance.
T R C Hill
Director
29 July 2025
Director's Statement and Strategic Review - N J Day
Introduction
I joined the Board of Directors of Minoan Group Plc ("Minoan") on 16 May 2025. However, I only enjoyed full access, being directly or indirectly, to the bank accounts and emails of Minoan") and Loyalward Limited ("Loyalward") from 23 May 2025. The RNS "Appointment of Non-Executive Director" of 16 May 2025 details any potential conflict of interest that I might have. Mindful of the potential conflict of interest, Tim Hill and I have ensured that a strict "Chinese Wall" has been maintained between me and the other members of DAGG LLP throughout this audit.
Review of business
Tim Hill has provided a review of the Group's business given in the Statement on pages 2 and 3.
The Key Performance Indicator for the Group is the Monetisation of the Project. Monetisation means the extraction of value from the Project for the benefit of shareholders and other stakeholders. No extraction of value occurred in the last fiscal year. Nor has any extraction of value occurred since the Site has been provided to Loyalward under the terms of the Contract entered into following an international tender.
Group Principal Activities
The Company is a public limited company incorporated in England and Wales and quoted on AIM, albeit trading of the Company's shares was suspended temporarily with effect from 1 May 2025. The Company's principal activity in the year under review was that of a holding and management company of a Group involved in the design, creation, development, and management of environmentally friendly luxury hotels and resorts.
Principal Risks and Uncertainties
The Group's key risk is the Project.
Two themes are constant: the deterioration in the relationship between Minoan and Public Welfare Ecclesiastical Foundation Panagia Akrotiriani, the landowner of the Cavo Sidero peninsula, which the Company proposes to develop, as well as the deterioration in the financial position of Minoan. It is this Director's opinion that both themes have become intertwined.
Relationship between Minoan Group Plc and Public Welfare Ecclesiastical Foundation Panagia Akrotiriani (the "Foundation")
The last person to person meeting between a board member of Minoan and board members of the Foundation took place in Athens on 18 June 2024. Whilst conversations carried on between advisors of the Foundation and Minoan, by 31 December 2024, the contract of the Greek law firm who had acted as Minoan's adviser in negotiations with the Foundation had ended owing to non-payment. Indeed, the Greek law firm's final invoice has still not been settled by Minoan. To reiterate no meetings between Minoan and the Foundation have occurred in 2025.
The breakdown in the relationship between the Foundation and Minoan culminated in the Board of Directors of the Foundation sending various letters to the Board members of Loyalward and Minoan. The first of these was on 6 December 2024. At the end of this letter, the Foundation Board said, "…we are commencing steps to exercise all our statutory rights and claims under the law and the Contract". Crucially, there had been no prior written correspondence from the Foundation to Minoan or Loyalward in which they had revealed they were considering pursuing legal remedies. Consequently, the dispute is different in nature to prior disagreements over the % revenue share of the Project and % of the profit on the share of villa leases between the Company and the Foundation. Not that these amounts are insignificant.
The Board of Directors of the Foundation, in the 6 December 2024 letter (Paragraph 5), asked that the Company:
"…must prove that it is able to implement the project by proving evidence of the company's financial capacity (proof of funds) and specifically company assets and bank letters of guarantee or any other appropriate document from a credit institution which shows that it either has or can immediately (specifying in detail how) secure both the necessary funds required".
Director's Statement and Strategic Review - N J Day (continued)
Minoan did not provide any evidence of its "financial capacity" in its reply to the Foundation. Not surprisingly, Minoan received a further letter from the Foundation on 17 March 2025 in which the Board of Directors of the Foundation said:
"…taking into account developments to date and the new circumstances that have emerged, as well as your failure to provide the necessary evidence of your company's financial capacity to undertake and complete the entire project, we reserve the right to exercise all our legal and contractual rights and claims."
There can be no guarantee therefore, that the Foundation will not begin formal legal proceedings against Loyalward and Minoan. To ensure creditors and shareholders have the fullest understanding of the relationship between Minoan and the Foundation, the Board of Directors unanimously decided to publish in full, rather than excerpts thereof, the and version of the letters received by the Directors of Minoan Group Plc, Loyalward Limited and Loyalward Hellas S.A. on 6 December 2024 and 17 March 2025 (see letters from The Public Welfare Foundation Panagia Akrotiarini in Note 21).
Under 3% of all monies spent by Loyalward and Minoan combined since 1991 has reached the Project's landlord, the Foundation. In aggregate, the payments to the Foundation amount to £1.4 million yet the Company has spent 20 times this amount on compensation and travel of Directors combined with the engagement of so-called Project Consultants. Minoan did not meet "key milestones" (Environmental Permitting as well as Financial Partnerships and Project Finance Agreements) set previously for 2024. Both milestones had been set in the Report of the Directors for the year ended 31 October 2022.
Financial position of the Minoan Group Plc
Minoan has not generated any revenue since the sale of Stewart Travel Limited in late 2018.
Minoan's shares traded below their par value throughout the course of the fiscal year 2024. The last time they traded at par value i.e.1p per share was in August 2023 before DAGG LLP members agreed to convert half of their then outstanding loan into shares. In the absence of action by Company management to address the par value issue, Minoan lacked access to the equity market to raise fresh capital. Indeed, 24 October 2022 is the last date when Minoan was able to issue new shares to provide fresh capital to fund the business as opposed to issuing shares in lieu of existing liabilities.
Minoan has announced that following an Event of Default on the secured loan from DAGG LLP as of 1 January 2025, the interest rate applied to the loan has risen to 22% per annum from 10% per annum previously. Already in the fiscal year ending 31 October 2024, fresh unsecured loans to Minoan entailed penal interest rates with a 150% annualised interest rate charge being the most noteworthy. It is also important to highlight that the duration of new unsecured loans granted to Minoan in the last fiscal year shortened appreciably.
Aside from the "New Loan" by DAGG LLP to Minoan, to cover the necessary payments to Anstey Bond LLP to allow the audit to proceed, Minoan has not received any other loan in calendar year 2025. No Letter of Intent or formal offer has been forthcoming from "a strategic partner" as referred to in Minoan's RNS of 6 January 2025. At that point in time, "…the Company expects to be able to provide a further update during the first quarter of 2025". Neither Tim Hill nor I have been able to prove the existence of said "strategic partner" referenced as of 6 January 2025.
In the absence of fresh funds, in April 2025 a County Court Judgement was made in favour of a creditor against Minoan Group Plc and Loyalward Limited. At Loyalward Hellas S.A., the Company's Greek subsidiary, the picture is even worse. Monies owed to the Hellenic Republic's tax and social security authorities have been outstanding such that fines and penalties for overdue payment are accumulating. To the best of my knowledge, a six-figure sum is due to the Greek tax and social security authorities by Loyalward Hellas S.A. whose Greek bank account has been "frozen" for several years.
Since joining the board of Minoan, I have made personally urgent payments to ensure that key files are still accessible both electronically and physically. I have ensured also, that the Company could keep its unique London Stock Exchange ID. Should the DAGG indicative proposal proceed, I have agreed to write off my entitlement to all Director's fees as a former Director of Loyalward (through Keith Day & Partners Ltd).
Director's Statement and Strategic Review - N J Day (Continued)
Over eight years have passed since the Greek Supreme Court dismissed appeals (petitions of annulment) against the Presidential Decree granting land use approval for the Company's Itanos Gaia project in Crete. This decision was, at the time (20 June 2017), viewed as a defining moment in the future of Minoan and the Itanos
Gaia Project itself.
Christopher Egleton, Minoan's Chairman at that time said:
"As a result of the Greek Supreme Court's decision, the Company can now accelerate the development of the Project, which will include, inter alia, the continuation of negotiations for joint venture agreements with hoteliers, investors, partners and other parties.
It also means that our long co-operation with the Foundation Panagia Akrotiriani, the Municipality of Sitia and the local community can begin to bring more prosperity to the area".
The reality is that no discernible progress has occurred in the ensuing eight years despite Minoan having incurred millions of pounds of costs. Opinions may vary as to what lies behind this failure to progress the Project, but it is an irrefutable fact.
My limited time as a Minoan board member has led me to question the robustness of the Company's internal controls. Key documentation both in Greece and the UK lies, all too often, with third-party consultants rather than with the Directors of the Company. The past failure to show the two full time employees at Loyalward Hellas S.A. and the resulting monies owed to the Hellenic Republic in the form of tax and social security payments is the clearest example of the failure in internal controls. The Company has not had a Finance Director since Barry Bartman resigned on 15 February 2022. Minoan has not had a Managing Director let alone Chief Executive Officer since Duncan Wilson resigned 9 October 2018.
With access to limited financial resources at Minoan since the sale of the Stewart Travel Group, whose proceeds did not match those targeted at the outset of the disposal process, I am surprised that expenditures were not minimised. Given the lack of alignment in the recent past between Directors and shareholders, the Board of Directors met on 6 July 2025 and passed unanimously a resolution ending the Executive Director's Bonus scheme and the Villa discount Schemes for Management.
Impairment of site value
The decision to impair the site value predates my appointment to the Minoan board; the minutes of the Audit Committee's March meeting of this year are clear in this respect.
Going concern
The Board of Directors has agreed unanimously that the Company as currently constituted is not a going concern. Should the DAGG LLP indicative proposal fail to advance, Minoan will enter into an insolvency process.
Corporate Governance
The Board supports the principles of good governance. The Group is committed high standards of corporate governance and has adopted procedures from the Quoted Companies Alliance Corporate Governance Code to institute good governance insofar as they are practical and appropriate for a business of the size of Minoan. The Board has a Renumeration and Audit Committee, in each case comprising a majority of non- executive directors.
Board effectiveness
The Group supports the concept of an effective Board leading and providing effective governance over the Group. The board is responsible for approving Group policy and strategy. It meets regularly and has a schedule of matters specifically reserved to it for decision. Management supplies the board with appropriate and timely information and the directors are free to seek any further information that they consider necessary. In normal circumstances, all directors' have access to advice from independent professionals at the Group's expense.
Director's Statement and Strategic Review - N J Day (continued)
Corporate Social Responsibility
The Project is focused strictly on the long-term restoration and preservation of the environment as a whole and puts in place a sustainable management plan, involving local representatives and experts, to ensure a robust, pro-active management system is implemented aimed at protecting the area for future generations.
Since joining the Minoan Board, I have endeavoured to ensure that the Group is compliant with all appropriate regulations.
Section 172(1) Statement
The Directors are mindful of their duties under section 172(1) of the Companies Act 2006, which requires them to act in good faith in a way that promotes the success of the Group for the benefit of its members as a whole, and in doing so to have regard (amongst other matters) to:
· the likely consequences of any decision in the long term;
· the interests of the Group's employees;
· the need to foster the Group's business relationships with suppliers, customers and others;
· the impact of the Group's operations on the community and the environment;
· the desirability of the Company maintaining a reputation for high standards of business conduct; and
· the need to act fairly between members of the Group.
During the financial year, the Group did not generate revenue and had under 50 employees. However, the Group holds a significant development asset and remains actively involved in managing strategic investments and overseeing ongoing legal, financial and regulatory matters connected with its principal project in Crete. As such, the Directors' decision-making has remained focused on protecting asset value and maintaining effective governance and compliance.
Although the Group has few direct employees, the Directors engage with external advisors, legal counsel, and professional service providers to ensure that stakeholder considerations, such as legal obligations, environmental factors, and the interests of shareholders, are reflected in the Group's actions.
The Board also recognises its responsibility to shareholders and continues to communicate transparently via regulatory announcements and the AIM Rule-compliant reporting framework. The Board has also taken into account the current uncertainty regarding the lease arrangements on the Group's primary site and continues to act in a manner it believes promotes the long-term value of the Group and protects stakeholder interests.
N J Day
Director
29 July 2025
Consolidated Statement of Comprehensive Income
Year ended 31 October 2024
|
|
|
2024 £'000 |
2023 £'000 |
|
Revenue |
|
- |
- |
|
Cost of sales |
|
- |
- |
|
Gross profit |
|
- |
- |
|
|
|
- |
- |
|
Operating expenses |
|
(658) |
(536) |
|
|
|
|
|
|
Other operating expenses: |
|
|
|
|
Corporate development costs |
|
- |
- |
|
Operating loss |
|
(658) |
(536) |
|
|
|
|
|
|
Finance costs |
|
(378)
|
7 |
|
Impairment charge |
|
(46,258) |
- |
|
|
|
|
|
|
Loss before taxation |
|
(47,294) |
(529) |
|
|
|
|
|
|
Taxation |
|
- |
- |
|
Loss after taxation |
|
(47,294) |
(529) |
|
|
|
|
|
|
Other Comprehensive income for the year |
|
- |
- |
|
Total Comprehensive income for the year |
|
(47,294) |
(529) |
|
|
|
|
|
|
Loss for year attributable to equity holders of the Company |
|
(47,294) |
(529) |
|
|
|
|
|
|
Loss per share attributable to equity holders of |
|
|
|
|
the Company: Basic and diluted |
|
(5.7)p |
(0.07)p |
|
|
|
|
|
Consolidated Statement of Changes in Equity
Year ended 31 October 2024
Year ended 31 October 2024
|
|
Share capital £'000 |
Share premium £'000 |
Merger reserve £'000 |
Warrant Reserve £'000 |
Retained earnings £'000 |
Total equity £'000 |
|
Balance at 1 November 2023 |
20,509 |
36,583 |
9,349 |
2,461 |
(26,712) |
42,190 |
|
Loss for the year |
- |
- |
- |
- |
(47,294) |
(47,294) |
|
Issue of ordinary shares at par |
930 |
- |
- |
- |
- |
930 |
|
Decrease in Warrant Reserve |
- |
- |
- |
(0) |
- |
(0) |
|
Balance at 31 October 2024 |
21,439 |
36,583 |
9,349 |
2,461 |
(74,006) |
(4,174) |
Year ended 31 October 2023
|
|
Share capital £'000 |
Share premium £'000 |
Merger reserve £'000 |
Warrant Reserve £'000 |
Retained earnings £'000 |
Total equity £'000 |
|
Balance at 1 November 2022 |
20,321 |
36,583 |
9,349 |
2,619 |
(26,183) |
42,689 |
|
Loss for the year |
- |
- |
- |
- |
(529) |
(529) |
|
Issue of ordinary shares at par |
188 |
- |
- |
- |
- |
188 |
|
Decrease in Warrant Reserve |
- |
- |
- |
(158) |
- |
(158) |
|
Balance at 31 October 2023 |
20,509 |
36,583 |
9,349 |
2,461 |
(26,712) |
42,190 |
Consolidated Statement of Financial Position as at 31 October 2024
|
|
|
2024 |
2023 |
|
Assets |
|
|
|
|
Non-current assets |
|
|
|
|
Intangible assets |
|
1 |
3,583 |
|
Property, plant and equipment |
|
2 |
157 |
|
Total non-current assets |
|
3 |
3,740 |
|
Current assets |
|
|
|
|
Inventories |
|
6,100 |
47,995 |
|
Receivables |
|
114 |
117 |
|
Cash and cash equivalents |
|
17 |
17 |
|
Total current assets |
|
6,231 |
48,129 |
|
|
|
|
|
|
Total assets |
|
6,234 |
51,869 |
|
|
|
|
|
|
Equity |
|
|
|
|
Share capital |
|
21,439 |
20,509 |
|
Share premium account |
|
36,583 |
36,583 |
|
Merger reserve account |
|
9,349 |
9,349 |
|
Warrant reserve |
|
2,461 |
2,461 |
|
Retained earnings |
|
(74,006) |
(26,712) |
|
Total equity |
|
(4,174) |
42,190 |
|
|
|
|
|
|
Liabilities |
|
|
|
|
Current liabilities |
|
10,408 |
9,679 |
|
|
|
|
|
|
Total equity and liabilities |
|
6,234 |
51,869 |
Consolidated Cash Flow Statement
Year ended 31 October 2024
|
|
|
2024 £'000 |
2023 £'000 |
|
|
|
|
|
|
Cash flows from operating activities |
|
|
|
|
Loss before taxation |
|
(47,294) |
(529) |
|
Finance costs |
|
378 |
(7) |
|
Decrease/increase) in inventories |
|
41,895 |
(606) |
|
Impairment of non-current assets |
|
3,737 |
- |
|
Decrease in receivables |
|
4 |
50 |
|
Increase in current liabilities |
|
795 |
591 |
|
Net cash (outflow) from operations |
|
(485) |
(501) |
|
Finance costs |
|
(378) |
(151) |
|
Net cash used in operating activities |
|
(863) |
(652) |
|
|
|
|
|
|
Cash flows from investing activities |
|
|
|
|
Purchase of property, plant and equipment |
|
- |
- |
|
Net cash used in investing activities |
|
- |
- |
|
|
|
|
|
|
Cash flows from financing activities |
|
|
|
|
Net proceeds from the issue of ordinary shares |
|
930 |
188 |
|
Loans received/(repaid0 |
|
(67) |
351 |
|
Net cash generated from financing activities |
|
863 |
539 |
|
|
|
|
|
|
Net decrease in cash |
|
- |
(113) |
|
|
|
|
|
|
Cash at beginning of year |
|
17 |
130 |
|
Cash at end of year |
|
17 |
17 |
Notes to the Consolidated Financial Statements
Year ended 31 October 2024
1 General information
The financial information set out in this announcement does not constitute statutory financial statements for the year ended 31 October 2023 or 31 October 2024. The report of the on the consolidated financial statements of Minoan Group Plc for the year ended 31 October 2024 did not express an audit opinion.
The statutory financial statements for the year ended 31 October 2024 have been delivered to the Registrar of Companies.
The Company is a public limited company incorporated in England and Wales. The Company's principal activity in the year under review was that of a holding and management company of a Group involved in the design, creation, development and management of environmentally friendly luxury hotels and resorts.
Anstey Bond Disclaimer of Opinion
We were engaged to audit the financial statements of Minoan Group Plc ("the Parent") and its subsidiaries (''the Group'') for the year ended 31 October 2024 which comprise; the consolidated statement of profit or loss and other comprehensive income, the consolidated and parent company's statement of financial position, the consolidated and parent company's statement of changes in equity, the consolidated and company's statement of cash flows and notes to the consolidated 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 United Kingdom.
We do not express an opinion on the accompanying consolidated financial statements of the Group. Because of the significance of the matter described in the Basis for Disclaimer of Opinion section of our report, we have not been able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion on these consolidated financial statements.
Anstey Bond Basis for Disclaimer of Opinion
We were engaged to audit the consolidated financial statements of Minoan Group Plc for the year ended 31 October 2024. However, we were unable to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion.
Our appointment as auditors was formally reconfirmed on 20 June 2025, following the signing of a new engagement letter and the settlement of outstanding fees. This occurred several months after the financial year-end. As a result, our appointment was confirmed later than expected, which in turn placed certain constraints on the scope of our work. It limited opportunities to observe year-end procedures, access contemporaneous documentation, and engage with individuals possessing detailed knowledge of material balances and key judgments reflected in the financial statements.
Following the financial year-end, the Company experienced notable changes in its management team, including the departure of the former Chairman and other directors who had been closely involved with, and possessed detailed knowledge of, accounting and operational matters relating to key balances. In light of these transitions and, given the limited financial resources available to seek external guidance, our ability to obtain explanations or audit evidence in certain areas - particularly those requiring historical context or prior judgments - was impacted.
We were unable to obtain direct confirmations or sufficient alternative audit evidence in respect of certain material trade and other payables, loans and accruals and deferred charges, totalling a minimum of £2,047,709, £646.808 and £1,236,537 respectively. Management was unable to provide adequate supporting documentation for these balances, and as such, we were unable to determine whether any adjustments might be necessary. We were unable to obtain sufficient appropriate audit evidence to support material accruals
recognised in the consolidated financial statements. Due to the lack of supporting documentation and clarity regarding the underlying transactions, we could not determine whether these liabilities were complete or appropriately valued.
Notes to the Consolidated Financial Statements (continued)
Year ended 31 October 2024
1 General Information (continued)
Anstey Bond Basis for Disclaimer of Opinion (continued)
The Group's statement of financial position includes development property classified as inventory with a carrying amount of £6.1 million as at 31 October 2024 (2023: £48.0 million). This balance pertains to the Cavo Sidero Project and is stated net of an impairment charge of £46.3 million recognised during the year. The impairment was determined by management based on their internal assessment of the asset's recoverable amount; however, a formal, independent third-party valuation was not commissioned to support this assessment as the Company had insufficient funds to pay for a valuation. We were therefore not provided with sufficient appropriate audit evidence to support the key assumptions underlying management's valuation and the resultant impairment charge. Consequently, we were unable to perform alternative procedures to corroborate the carrying amount of the development property. As a result, we could not determine whether any adjustments to this balance were necessary. The inventory relates to a development project situated on leased land in Crete.
The inventory relates to a 10 development project situated on leased land in Crete. Further details of the Foundation's concerns pertain to this Minoan Group Plc (Registered number: 03770602) lease - held by the Foundation as lessor for the Cavo Sidero Project - which may seek to challenge the Group's rights as lessee to the land. Further details of this dispute can be found in the letters included in Note 21. The outcome of this matter will materially affect the net realisable value of the asset, including the potential non extension upon expiry of the original lease agreement and therefore the realisation of the project. Due to both valuation uncertainty and unresolved legal status, we were unable to conclude on the appropriateness of the inventory's measurement or classification.
The parent company's balance sheet includes an intercompany receivable of £4,037,499 due from subsidiary undertakings. Management have not been able to provide sufficient appropriate audit evidence to support the recoverability of these balances. In particular, no reliable financial information, cash flow forecasts, or evidence of the subsidiaries' ability to repay these amounts were available to us. Due to the lack of supporting documentation and the absence of sufficient audit evidence, we were unable to determine whether these intercompany balances are recoverable or whether any impairment is required. Accordingly, we were unable to determine whether any adjustments to these balances may have been necessary.
As a direct consequence of the matter described above concerning the Cavo Sidero Project, we were also unable to obtain sufficient appropriate audit evidence to support the carrying amount of the parent company's investment in its subsidiary, Loyalward Limited.
The value of this investment, recorded at £4,002,000 in the parent company statement of financial position, is wholly dependent on the recoverable amount of the project's underlying assets. Accordingly, we could not determine whether any adjustments were required to the carrying amount of the investment in the subsidiary.
Receivables include a material balance within a Greek subsidiary, Loyalward Hellas S.A, which was previously immaterial but has become significant due to changes in group asset values. The subsidiary has not provided sufficient financial records or evidence to support this and other receivables balances totalling £101,072, and we were therefore unable to verify its recoverability or appropriateness for recognition.
In light of the matters outlined above, including challenges in obtaining sufficient appropriate audit evidence relating to accruals, creditor balances, prepayments, and inventory valuation, we were consequently unable
Notes to the Consolidated Financial Statements (continued)
Year ended 31 October 2024
1 General Information (continued)
Anstey Bond Basis for Disclaimer of Opinion (continued)
to gain adequate assurance regarding the completeness and accuracy of expenditure recognised in the consolidated statements of comprehensive income for the year ended 31 October 2024. Several of these balances have a direct influence on the consolidated statements of comprehensive income, particularly in relation to cost of sales, administrative expenses, finance costs, and impairment charges. Due to limitations in the availability of reliable audit evidence, continuity in the audit trail, and management explanations, we were not able to obtain the necessary information to assess whether the reported results for the year are free from material misstatement. Consequently, this has contributed to our overall conclusion that we are unable to express an opinion on the financial statements in their entirety.
Due to the significance of the matters described above, we were unable to obtain sufficient appropriate audit evidence in respect of several material areas of the financial statements, a result of these matters, we were unable to determine whether any adjustments might have been found necessary in respect of recorded or unrecorded transactions. The potential impact of these matters is both material and pervasive.
2 Accounting policies
Basis of preparation
The financial statements are prepared under the historical cost convention except for where financial instruments are stated at fair value and where impairments have been provided following the consideration of the financial and commercial position of the Company as detailed below.
Upcoming Standard/Amendment
The International Accounting Standards Board and IFRIC have issued the following new and revised standards and interpretations with an effective date after the date of these financial statements, which have been endorsed and issued by the United Kingdom at 31 October 2024:
|
Upcoming Standard / Amendment
|
Effective Date |
Anticipated Impact |
|
IFRS 18 - Presentation and Disclosure in Financial Statements |
1 January 2027 |
Expected to significantly affect the structure and presentation of financial statements. Under review. |
|
Amendments to IAS 1 - Disclosure of Accounting Policies |
1 January 2024 |
Likely to affect the format and granularity of accounting policy disclosures. |
|
Amendments to IAS 8 - Definition of Accounting Estimates |
1 January 2024 |
Disclosure enhancements expected; no recognition impact anticipated. |
|
Amendments to IFRS 16 - Lease Liability in a Sale and Leaseback |
1 January 2024 |
Not applicable. The Group has not engaged in sale and leaseback transactions. |
Going concern
The directors have considered the financial and commercial position of the Group in relation to its project in Crete (the "Project"). In particular, the directors have reviewed the matters referred to below.
Following the unanimous approval of a Plenum of the Greek Council of State, the highest court in Greece, the Presidential Decree granting land use approval for the Project was issued on 11 March 2016 and was published in the Government Gazette. The planning rules for the Project are now enshrined in law. The appeals lodged against the Presidential Decree have been rejected by the Greek Supreme Court.
Notes to the Consolidated Financial Statements (continued)
Year ended 31 October 2024
2 Accounting policies (continued)
Going concern (continued)
In addition to specific Project related matters as noted above, and as has been the case in the past, the Group has continued to need to and attempt to raise capital in order to meet its existing finance and working capital requirements. However, this financial route has proven impossible to maintain.
Having taken these matters into account, together with the financial position of the Group, as referred to in the Directors' Statements and the Strategic Report, the Directors consider that preparation of the consolidated financial statements on a going concern basis is not appropriate.
Due to the consolidated financial statements not being prepared on a going concern basis the directors have, as part of the annual review of carrying values, impaired the following items in line with Net Realisable value:
Group intangible assets - carrying value reduced from £3,583,000 at 31 October 2023 to £1,000 at 31 October 2024.
Group property, plant and equipment - carrying value reduced from £157,000 at 31 October 2023 to £2,000 at 31 October 2024.
Group inventories - carrying value reduced from £47,995,000 at 31 October 2023 to £6,100,000 at 31 October 2024.
Company investments - carrying value reduced from £31,736,000 at 31 October 2023 to £4,002,000 at 31 October 2024.
Company receivables - carrying value reduced from £24,283,000 at 31 October 2023 to £4,025,000 at 31 October 2024.
In view of the above and the Group's inability to raise fresh funds, should the DAGG LLP indicative proposal fail to advance, Minoan Group Plc will enter into an insolvency process.
Basis of consolidation
The consolidated financial statements incorporate the financial statements of the Company and all its subsidiaries as at 31 October 2024 using uniform accounting policies. The Group's policy is to consolidate the result of subsidiaries acquired in the year from the date of acquisition to the Group's next accounting reference date. Intra-group balances are eliminated on consolidation.
Acquisitions of subsidiaries and businesses are accounted for using the acquisition method. The consideration for each acquisition is measured at the aggregate of the fair values of the assets given, liabilities incurred and equity instruments issued by the Group in exchange for control of the acquired business. Acquisition related costs are recognised in the consolidated statement of comprehensive income as incurred.
Critical accounting estimates and judgements
The preparation of the financial statements in accordance with generally accepted financial accounting principles requires the directors to make critical accounting estimates and judgements that affect the amounts reported in the financial statements and accompanying notes. The estimates and assumptions that have a significant risk of causing material adjustments to the carrying value of assets and liabilities within the next financial year are discussed below:
· in capitalising the costs directly attributable to the Project (see inventories below), and continuing to recognise goodwill relating to the Project, the directors are of the opinion that the Project will be brought to fruition and that the carrying value of inventories and goodwill is recoverable; and
· as set out above, the directors have exercised judgement in concluding that the Company and Group is not a going concern.
Notes to the Consolidated Financial Statements (continued)
Year ended 31 October 2024
2 Accounting policies (continued)
Goodwill
Goodwill arising on acquisitions represents the difference between the fair value of the net assets acquired and the consideration paid and is recognised as an asset.
Goodwill arising on acquisition is allocated to cash-generating units. The recoverable amount of the cash-generating unit to which goodwill has been allocated is tested for impairment annually, or on such other occasions that events or changes in circumstances indicate that it might be impaired. Any impairment is recognised immediately as an expense and is not subsequently reversed.
Property, plant and equipment
Property, plant and equipment is stated at historical cost less accumulated depreciation and any recognised impairment loss.
Depreciation is provided in order to write off the cost of each asset, less its estimated residual value, over its estimated useful life on a straight-line basis as follows:
Plant and equipment: 3 to 5 years
Fixtures and fittings: 3 years
Where the carrying amount of an asset is greater than its estimated recoverable amount, it is written down immediately to its recoverable amount.
Investments
Investments in subsidiaries are stated at cost less any impairment deemed necessary.
Inventories
Inventories represent the actual costs of goods and services directly attributable to the acquisition and development of the Project and are stated at the lower of cost and net realisable value. The Directors review the value of the balance held at least once a year with a view to impairment.
Foreign currency
A foreign currency transaction is recorded, on initial recognition in Sterling, by applying to the foreign currency amount the spot exchange rate between the functional currency and the foreign currency at the date of the transaction.
At the end of the reporting period:
· foreign currency monetary items are translated using the closing rate;
· non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rate at the date of the transaction; and
· non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was determined.
Exchange differences arising on the settlement of monetary items or on translating monetary items at rates different from those at which they were translated on initial recognition during the period or in previous annual financial statements are recognised in profit or loss in the period in which they arise.
When a gain or loss on a non-monetary item is recognised to other comprehensive income and accumulated in equity, any exchange component of that gain or loss is recognised to other comprehensive income and accumulated in equity. When a gain or loss on a non-monetary item is recognised in profit or loss, any exchange component of that gain or loss is recognised in profit or loss.
Cash flows arising from transactions in a foreign currency are recorded in Sterling by applying to the foreign currency amount the exchange rate between the Sterling and the foreign currency at the date of the cash flow.
Notes to the Consolidated Financial Statements (continued)
Year ended 31 October 2024
2 Accounting policies (continued)
Cash and cash equivalents
Cash and cash equivalents include cash in hand and short-term deposits, with a maturity of less than three months, held with banks.
Trade and other receivables
Trade and other receivables are recognised initially at fair value and shown less any provision for amounts considered irrecoverable. They are subsequently measured at an amortised cost using the effective interest rate method, less irrecoverable provision for receivables.
Trade and other payables
Trade and other payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest rate method.
Loans
Loan borrowings are recognised initially at fair value net of transaction costs incurred. Borrowings are subsequently stated at amortised cost and any difference between the proceeds (net of transaction costs) and the redemption value is recognised as a borrowing cost over the period of the borrowings using the effective interest method.
Share-based payments
The Company has granted Options and Warrants to purchase Ordinary Shares. The fair values of the Options and Warrants are calculated using the Black-Scholes and Binomial option pricing models as appropriate at the grant date. The fair value of the Options is charged to profit or loss with a corresponding entry recognised in equity. This charge does not involve any cash payment by the Group.
Where Warrants are issued in conjunction with a loan instrument, the fair value of the Warrants forms part of the total finance cost associated with that instrument and is released to profit or loss through finance costs over the term of that instrument using the effective interest method.
Taxation
Current taxes, where applicable, are based on the results shown in the financial statements and are calculated according to local tax rules using tax rates enacted, or substantially enacted, by the statement of financial position date and taking into account deferred taxation. Deferred tax is computed using the liability method. Under this method, deferred tax assets and liabilities are determined based on temporary differences between the financial reporting and tax bases of assets and liabilities and are measured using enacted rates and laws that will be in effect when the differences are expected to reverse. Deferred tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction that at the time of the transaction affects neither accounting, nor taxable profit or loss. Deferred tax assets are recognised to the extent that it is probable that future taxable profits will arise against which the temporary differences will be utilised.
Deferred tax is provided on temporary differences arising on investments in subsidiaries except where the timing of the reversal of the temporary difference is controlled by the Group and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred tax assets and liabilities arising in the same tax jurisdiction are offset.
The Group is entitled to a tax deduction for amounts treated as compensation on exercise of certain employee share options. As explained under "Share-based payments" above, a compensation expense is recorded in the Group's statement of comprehensive income over the period from the grant date to the vesting date of the relevant options. As there is a temporary difference between the accounting and tax bases a deferred tax asset is recorded. The deferred tax asset arising is calculated by comparing the estimated amount of tax deduction to be obtained in the future (based on the Company's share price at the statement of financial position date) with the cumulative amount of the compensation expense recorded in the statement of comprehensive income. If the amount of estimated future tax deduction exceeds the cumulative amount of the remuneration expense at the statutory rate, the excess is recorded directly in equity against retained earnings.
Notes to the Consolidated Financial Statements (continued)
Year ended 31 October 2024
3 Information regarding directors and employees
Directors' and key management remuneration
|
|
|
Costs taken to |
|
|
|
£'000 |
£'000 |
£'000 |
|
Year ended 31 October 2024 |
|
|
|
|
Fees |
56 |
95 |
151 |
|
Sums charged by third parties for |
- |
215 |
215 |
|
|
56 |
310 |
366 |
|
Year ended 31 October 2023 |
|
|
|
|
Fees |
95 |
90 |
185 |
|
Sums charged by third parties for |
- |
95 |
95 |
|
|
95 |
185 |
280 |
The total directors' and key management remuneration shown above includes the following amounts in respect of the directors of the Company. No director has a service agreement with a notice period that exceeds twelve months.
|
|
2024 Fees/Sums charged by third parties |
2023 Fees/Sums charged by third parties |
|
|
£'000 |
£'000 |
|
C W Egleton (Chairman) |
180 |
60 |
|
G D Cook |
40 |
35 |
|
T R C Hill |
40 |
35 |
|
G Mergos (Resigned 7 March 2024) |
16 |
60 |
|
|
276 |
190 |
|
|
2024 |
2023 |
|
|
No. |
No. |
|
Group monthly average number of persons employed |
|
|
|
Directors |
7 |
8 |
|
Management, administration and sales |
2 |
2 |
A revision has been made to the 2023 Group monthly average numbers of persons employed so as to reflect the fact that two persons were employed in management, administration and sales.
Notes to the Consolidated Financial Statements (continued)
Year ended 31 October 2024
4 Loss before taxation
The loss before taxation is stated after charging:
|
|
2024 £'000 |
2023 £'000 |
|
Depreciation |
- |
- |
|
Impairment charge |
46,258 |
- |
|
Auditor's remuneration |
48 |
40 |
The Impairment charge comprises the following:
Impairment of Inventories 42,576 -
Write-off of accruals (55) -
Impairment of intangible assets 3,582 -
|
Impairment of property, plant & equipment |
155 |
- |
|
|
46,258 |
- |
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