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Stride Gaming PLC (STR)

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Monday 16 November, 2015

Stride Gaming PLC

Preliminary Results

RNS Number : 7599F
Stride Gaming PLC
16 November 2015
 

 16 November 2015

Stride Gaming plc

("Stride Gaming", the "Company", or "the Group")

 

Preliminary Results

Successful listing on AIM, completed acquisitions and strong organic growth

 

Stride Gaming plc (AIM: STR), the multi-branded online gaming operator, today announces its preliminary results for the year ended 31 August 2015 ("the period").

 

Financial highlights

 

·     IPO on AIM on 19 May 2015 raising £11.2 million (before expenses);

·     Net Gaming Revenue ("NGR") growth of 227% to £27.8 million* (2014: £8.5 million);

·     Adjusted EBITDA** up 508% to £7.3m (2014: £1.2 million);

·     Adjusted profit before tax** up 388% to £3.9 million (2014: £0.8 million)

·     Profit after tax of £0.4 million (2014: £0.8 million);

·     Gross assets up 740% to £48.7 million (2014: £5.8 million), including cash of £7.4 million (2014: £Nil);

·     Yield per player from real money gaming up 14.3% to £112 (2014: £98).

 

Operational Highlights

 

·     Organic growth complemented by the successful completion of 3 acquisitions:

Acquisition of InfiApps Limited, a profitable, internationally focused mobile social gaming company, for total consideration payable of up to $40 million;

Acquisition of the trade and assets of Table Top Entertainment Limited ("TTE") including the brands Jackpot Café, Jackpot Liner and King Jackpot and the acquisition of the propriety gaming platform from Nextec Software Inc for total consideration of £14.7m; and

Acquisition of Spacebar Media for consideration of £6.0m.

·     Funded players*** up 278% to 52,000 (2014: 13,750);

·     Mobile and touch represents 48.9% of the NGR (2014: 19.7%)^;

·     Launch of three new brands: Bingo Extra, Magical Vegas and Big Top Casino;

·     Obtained an Italian gaming license and stake in a Spanish slots operation;

·     Completion of migration of several brands into responsive adaptive (RAD) based websites, which is more mobile and tablet oriented; and

·     39 proprietary games in the process of being integrated onto the Company's platforms.

 

 

 

 

 

* Stride Gaming plc was incorporated on 25 February 2015 and subsequent to this on 19 May 2015 acquired, via a share for share exchange, the entire share capital of the group headed by Daub Alderney Limited. Following this Group reorganisation the financial statements for the period ended 31 August 2015 have been prepared on a merger accounting basis as though this group structure had always been in place   (see note 1 for further details).

** Adjusted EBITDA and adjusted profit before tax excludes income or expenses that relate to exceptional items and non-cash charges relating to share-based payments.

 *** Funded player means an active player has made a deposit with his own funds within the last three months.

^ Percentages exclude three brands which are download-only technology.

 

 

Commenting on the results, Nigel Payne, Non Executive-Chairman of Stride Gaming, said:

 

"I am delighted to present the maiden set of Preliminary Results for the year ended 31 August 2015. It has been an exceptional year for Stride Gaming and the Group's performance in the period has been outstanding.

 

"We listed on AIM in an oversubscribed placing, raising £11.2 million before expenses, to facilitate our organic and acquisitive growth strategy to take advantage of the consolidation in the online bingo industry, which is being driven by increasing regulation. We are making significant progress on delivering on our strategy.

 

"The Group acquired InfiApps to move into the social gaming segment of online gaming, delivered record level growth across all our key performance indicators, added three new brands to our portfolio and continued to develop our proprietary software and in-house platforms.

 

"We believe we have put in place a solid foundation from which to further expedite the growth of the Company and the Board looks to the future with confidence."

 

 

 

Enquiries:

 

Stride Gaming plc 

Nigel Payne (Non-Executive Chairman)

Eitan Boyd (Chief Executive Officer)

Ronen Kannor (Chief Financial Officer)

www.stridegaming.com 

+44 (0) 20 7284 6080

Cantor Fitzgerald Europe (NOMAD and BROKER)

+44 (0) 20 7894 7000

Catherine Leftley

Marc Milmo

William Goode

 

 

Yellow Jersey PR

Alistair de Kare-Silver

Dominic Barretto

 

+44 (0) 7738 076 304

 

 

About Stride Gaming:

 

Stride Gaming is an online gaming operator in the bingo-led and the global social gaming market. The Company operates a multi-branded strategy across its two verticals, and uses its own proprietary and purchased software to provide online bingo and slot gaming for its players, and a social gaming mobile application. Stride Gaming's real money offering is presently focused on the UK market, is licensed and only operates from the regulated jurisdictions of the UK and Alderney. The Company's players' reach is international in the mobile social gaming market with a focus on the North American market.

 

Further information on the Group is available at: www.stridegaming.com. 

 

 

Chairman's Statement

On behalf of the Board, I am delighted to present Stride Gaming's results for the year ended 31 August 2015. The Group has performed strongly in the period and is well positioned for 2016 and beyond.

 

This year was a transformational year for the Group. We listed on AIM in an oversubscribed placing, raising £11.2 million before expenses, delivered record level growth across all the key performance indicators of the business, acquired InfiApps to move into the social gaming segment of online gaming in line with our strategy, added three new brands to the platform and continued to develop our proprietary software and in-house platforms.

 

The response to the Group's admission to AIM has been extremely positive and the Company's shares have performed well since the listing, which we believe demonstrates confidence in the Group's strategic plan and in the management team's ability to deliver and generate returns.

 

Stride Gaming's overall strategy is to become a market leader in the soft gaming verticals of the online gaming industry and to expand our presence in the UK and in international markets. Our listing has enabled us to accelerate our organic and acquisitive growth strategy and take advantage of the opportunities that exist in the sector. We are clear that the global online gaming market will continue to be shaped by further consolidation as a result of increased regulation and taxes, and the need to add scale. In addition, the appeal of social gaming is growing significantly. This environment only serves to enhance our growth prospects and we intend to take full advantage of it by continuing with our stated organic and acquisitive growth strategy. I am pleased to report that the Group is making excellent progress on delivering on its stated strategy.

 

As part of our buy and build strategy, as well as monitoring opportunities to expand into complementary verticals, we have successfully completed three acquisitions in the year, the most recent of which, InfiApps, was completed on 31 July 2015. A profitable internationally focused mobile social gaming company, the acquisition of InfiApps was immediately earnings enhancing and it is pleasing to see that the business has integrated well into the Group and is making a positive contribution to our product offering.

 

We also believe the market will be increasingly driven by the use of the mobile smart phone and tablets for gaming, and with the launch of our Responsive platform, we are well positioned to increase our mobile centric customer base. We expect organic growth to remain robust in the coming months as we make further improvements to our propriety software and the gaming experience. The Board remains focused on exploring opportunities to expand into other international markets and progress in this regard is already underway with the Italian gaming licence.

 

On behalf of the Board I would like to take this opportunity to thank all our staff for their commitment and hard work. The Board also joins me in welcoming all our new shareholders.

 

This past financial year has been a highly successful period for the Group and our long-term focus remains on delivering strong, sustainable returns for our shareholders. We look to the future with confidence.

 

Nigel Payne

Non-Executive Chairman

16 November 2015

 

 

Chief Executive's Review

 

I am pleased to report that the year ended 31 August 2015 was an exceptional period for Stride Gaming in which we delivered record results across all KPIs. We have enhanced our profitability and strengthened our balance sheet. The Group also made material progress in achieving a number of operational milestones that provide the Company with a platform for increased growth.

 

The Operation

 

The reported period has delivered a strong operational performance with NGR growth from real money gaming increasing by 214%. Our organic growth has outperformed our expectations, a testament to what we can achieve with scale and through owning our own proprietary software. This achievement is particularly pleasing in light of the current climate in which margins are being squeezed due to tax, regulatory compliance and technology costs.

 

Our number of funded players has now reached 52,000 representing a 278% year-on-year increase, and with software enhancements and continuous improvements to the backend of our platform we have shown a 14.3% growth in Yield per Player at £112 (2014: £98).

 

Adjusted EBITDA for the Group was up 508% to £7.3m and Adjusted EBITDA on real money gaming (excluding the one month contribution from InfiApps) was up 483% at £7.0 million. In the main this is attributed to the enhanced gaming offering from the Group, the optimisation of marketing costs and an increase in the life time value of our customers, where we continue to deliver a compelling and innovative gaming experience across a multitude of devices including mobile, tablet and PC.

 

We remain committed to enhancing our performance in real money terms and in social gaming verticals. The Group today has close to 200 staff across five countries.

 

Acquisitions

 

Acquisitions remain an integral part of the Group's growth strategy in order to take advantage of the consolidation in the sector and to move into complementary verticals. The Group's ability to successfully integrate acquisitions was demonstrated following the acquisition of the trade and assets of Table Top Entertainment Limited (including the brands Jackpot Café, Jackpot Liner and King Jackpot) and the acquisition of the propriety gaming platform from Nextec Software Inc; in aggregate for a total consideration of £14.7 million as well as Spacebar Media for consideration of £6.0 million.

 

As part of our strategy to move into complementary verticals and to diversify from solely bingo, on 31 July 2015 Stride Gaming successfully acquired InfiApps, a profitable internationally focused mobile social gaming company. The total consideration payable for the acquisition is up to $40 million. Of this, an initial consideration of US$22 million in cash was paid, together with additional earn-out consideration of up to $18 million payable in cash, determined by the EBITDA generated by InfiApps in the two years following completion of the acquisition. The acquisition provides us with a strong and profitable presence in the social gaming segment of online gaming across new and international geographies. The global social gaming segment is expected to grow from $5.4 billion in 2012 to $17.4 billion in 2019. The acquisition has been immediately earnings enhancing and with some 5.2 million player downloads of the flagship game, Slot Bonanza, and over 550,000 monthly active users worldwide, it adds material scale and reach to Stride Gaming's existing operations.

 

For the financial year ended 31 December 2014, InfiApps generated turnover of $13.7 million (2013: $4.6 million), EBIT of $3.6 million (2013: $1.0 million) and profit before tax of $3.4 million (2013: $1.0 million). In the financial year ended 31 December 2014, 69% of InfiApp's revenue was generated from North America. For the five months to 31 May 2015, InfiApps generated turnover of $8.3m and profit before tax of $2.3 million. These audited numbers are presented under US GAAP.

 Our Market

 

Our markets continue to remain robust and, according to the Gambling Commission, revenue in the UK gaming industry is expected to pass £3 billion by 2016. The UK online gaming market, including bingo led and poker, is estimated to grow to approximately £1.6 billion of NGR by 2016 with bingo-led online gaming estimated to account for 32.3 per cent.

 

Our industry is currently experiencing a wave of M&A activity, driven by increasing regulation, taxes, compliance, and technology costs. Companies are recognising that in order to survive in this more challenging regulatory environment they need to add scale.

 

We believe these increasing pressures, particularly the Point of Consumption tax ("POC tax") is likely to squeeze out a number of smaller scale online bingo operators, as they will not be able to absorb such an impact on their margins. At the other end of the market, we believe the larger operators will prioritise their marketing spend on their core products and less so on bingo. This presents an online bingo operator with scale an opportunity to increase market share both from organic growth and acquisition.

 

Mobile

 

The market is being increasingly driven by the use of the mobile smart phone and tablets for gaming, and with the launch of our new Responsive adaptive platform (RAD), which enables us to maintain a consistent user experience across a multitude of devices, Stride Gaming is well positioned to increase its mobile centric customer base. The effects of this strategy are already being seen, and on the brands that support the mobile device, 48.9% of NGR is now mobile driven (2014: 19.7%).

 

The RAD platform places great focus on mobile usability and we believe it will serve to further expedite our growth in the mobile sector. This is the fastest growing sector in the UK gambling industry with the percentage of customers betting on a mobile device increasing from 29% in 2013 to 43% in 2014, and in total 30% of overall bingo search volume is attributed to mobile devices (Online Gambling and betting: Mintel, 2014).

 

International markets

 

Another major growth opportunity we outlined in our strategy was to expand into international markets. I am pleased to report that the Group has obtained remote gambling licenses from the UK and Italian Gambling Commissions (AAMS), the latter of which provides us with an opportunity to access the Italian market.

 

Outlook

 

Our strategy remains focused on growing organically and through acquisition. As well as organic growth prospects remaining strong, we believe there are significant acquisition opportunities available, and we will continue to monitor potential selective strategic acquisitions that support our existing operations or that allow us to expand into complementary verticals. We believe the outlook for the Stride Gaming Group is exciting.

 

Eitan Boyd

Chief Executive Officer

16 November 2015

 

 

 

 

 

Chief Financial Officer's Review

 

The Group delivered NGR growth of 227% to £27.8 million (2014: £8.5 million) for the financial period. This top line growth was a result of the acquisition of the Table Top Entertainment brands in September 2014, along with strong organic growth reflected in the level of player activity. Of the total NGR for 2015, £1.1 million was also attributed to the InfiApps acquisition, an international mobile social gaming company, which the Group acquired on 31 July 2015.

 

Cost of sales at £2.8 million (2014: £Nil) relates to the POC tax, which became effective in December 2014, part way through the 2015 financial year.

 

Distribution costs including licencing, processing, royalties and marketing totalled £9.9 million (2014: £5.7 million). The increase has been driven by marketing costs (up 55%), but is in line with our expectations, reflecting the drive to capitalise on organic growth. The Group has managed to make an incremental cost reduction as a result of the integration of the TTE Sites into the Daub Alderney platform. This has taken the form of reduction in royalty payments in relation to the software on the TTE sites, and from processing charges from Stride Gaming's payment intermediary as a result of the larger scale of the business.

Administration costs of £7.8 million (2014: £1.6 million) increased as a result of the pre-IPO reorganisation of the Stride Gaming Group during the first half of the year. Back office operations were integrated for both the legacy TTE and the Daub Alderney platform operations, which resulted in additional cost reductions for the Group. Capitalisation of proprietary software development costs at £0.25 million (2014: £Nil) represent 30% of total development spend, while amortisation of capitalised development costs was £0.02 million (2014: £Nil).

 

Adjusted EBITDA increased by 508% to £7.3 million (2014: £1.2 million) reflecting an Adjusted EBITDA margin of 26% (2014: 14%). The result excludes the share-based payment charge on share options provided to certain consultants and the Executive Directors of the Group (£0.3 million), one off AIM listing costs (£1.2 million), costs associated with the acquisition of InfiApps (£1.9 million) and contingent remuneration (£0.2 million). Profit before Tax is down to £0.4 million (2014: £0.8 million) as a result of exceptional costs, share based payments and listing costs.

 

Group reorganisation, share placing and acquisitions

 

Stride Gaming plc was incorporated on 25 February 2015 in Jersey and on 19 May 2015 acquired Daub Alderney Limited, the real money gaming operator via a share for share exchange including its subsidiaries, Spacebar Media Limited, Shiftech Limited, Baldo Line SRL and SRG Services Limited, which provides support services to the Group.

 

The Company was admitted to trading on AIM on 19 May 2015, placing 8.4 million shares raising £11.2 million (£10.6 million net of share issue costs) to support the Group's buy and build and organic growth strategy, and to provide working capital for the development of the Group's proprietary software platform offering. 

 

Subsequent to admission, on 31 July 2015, the Group completed the acquisition of InfiApps Limited, an international mobile social gaming operator for $22 million in cash, together with an earn out consideration of up to another $18 million over a two year period determined by the EBITDA generated. For the acquisition of InfiApps, an £8 million shareholder loan was received at a 7.5% annual interest rate with a two-year repayment period.

 

Balance Sheet and Cash flow

 

The Group has a strong balance sheet with gross assets of £48.7 million (2014: £5.8 million) including cash and cash equivalents of £7.4 million (2014: £ nil). As a result of the IPO and the TTE and InfiApps acquisitions, the acquired assets including proprietary software, developed software and other assets strengthened the Group's financial position.

 

Due to the Group's strong financial performance, substantial cash flow of £4.6 million (2014: £Nil) was generated from operating activities, reflecting a high cash conversion rate of 105%. During the period the Group spent £0.5 million (2014: Nil) and £0.2 million (2014: £Nil) on intangible assets and on capitalisation of internally generated development costs respectively. Proceeds of £10.6 million (net of share issue costs) were raised during the Company's IPO through the issue of 8.4 million of new shares.

 

In March 2015, as part of the pre-IPO reorganisation, a £7.5 million dividend was declared, partly to clear a balance from the shareholder group, with £3.0 million paid in cash.

 

EPS and Dividend:

 

Reported basic and diluted earnings per share was 0.948p (2014: 2.711p) and 0.931p (2014: 2.711p) respectively. As the business is cash generative and highly profitable it is the Board's intention to adopt a progressive dividend policy in the future.  

 

 

Ronen Kannor

Chief Financial Officer

16 November 2015

 

 

 

 

Stride Gaming Plc

 

Consolidated statement of profit or loss and other comprehensive income

for the year ended 31 August 2015

 

 

 

Note

2015

2014

 

 

£'000

£'000

 

 

 

 

 

 

 

 

 

 

 

 

Net gaming revenue

1

27,811

8,489

 

 

 

 

Cost of sales

 

(2,753)

-

 

 

_______

_______

 

 

 

 

Gross profit

 

25,058

8,489

 

 

 

 

Distribution costs

3

(9,896)

(5,679)

Administrative expenses

3

(7,847)

(1,619)

 

 

 

 

Adjusted EBITDA

 

7,315

1,191

Share based payments

3

(306)

-

Acquisition costs

3

(1,893)

-

Contingent remuneration

3

(217)

-

Listing costs

3

(1,179)

(90)

Amortisation of intangible assets

3

(2,520)

(255)

Depreciation

3

(47)

-

 

 

 

 

Operating profit

 

1,153

846

 

 

 

 

Finance expense

5

(793)

-

 

 

_______

_______

 

 

 

 

Profit before tax

 

360

846

 

 

 

 

Tax credit

8

55

-

 

 

_______

_______

 

 

 

 

Profit after tax

 

415

846

 

 

 

 

Other comprehensive income:

 

 

 

 

 

 

 

Items that will or may be reclassified to profit or loss

 

-

-

Exchange gains arising on translation of foreign operations

 

7

-

 

 

_______

_______

Total comprehensive income for the period attributable to the equity holders of the parent entity

 

 

422

 

846

 

 

_______

_______

 

 

 

 

 

 

 

Earnings per Share (p)

9

 

 

Basic

 

0.948

2.711

Diluted

 

0.931

2.711

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The notes below form part of these financial statements.

 

 

 

           

 

Stride Gaming Plc

 

Consolidated statement of financial position

at 31 August 2015

 

 

 

Note

2015

2014

 

 

£'000

£'000

 

 

 

 

ASSETS

 

 

 

Non-current assets

 

 

 

Property plant and equipment

11

234

-

Intangible assets

12

36,367

-

Other receivables

14

248

83

Deferred tax asset

18

231

-

Available for sale investments

6

-

-

 

 

_______

_______

 

 

 

 

 

 

37,080

83

 

 

_______

_______

 

 

 

 

Current assets

 

 

 

Trade and other receivables

14

4,241

5,747

Income tax receivable

 

28

 

Cash and cash equivalents

16

7,388

-

 

 

_______

_______

 

 

 

 

 

 

11,657

5,747

 

 

_______

_______

 

 

 

 

Total assets

 

48,737

5,830

 

 

_______

_______

 

 

 

 

 

 

 

 

LIABILITIES

 

 

 

Non-current liabilities

 

 

 

Trade and other payables

15

100

-

Loans and borrowings

17

8,000

-

Deferred tax liability

18

2,133

-

 

 

_______

_______

 

 

 

 

 

 

10,233

-

 

 

_______

_______

 

 

 

 

Current liabilities

 

 

 

Trade and other payables

15

6,585

1,242

Income tax payable

 

33

-

Loans and borrowings

17

1,083

-

 

 

_______

_______

 

 

 

 

 

 

7,701

1,242

 

 

_______

_______

 

 

 

 

Total liabilities

 

17,934

1,242

 

 

_______

_______

 

 

 

 

Net assets

 

30,803

4,588

 

 

_______

_______

 

 

 

 

 

Stride Gaming Plc

 

Consolidated statement of financial position

at 31 August 2015 (continued)

 

 

 

Note

2015

2014

 

 

£'000

£'000

 

 

Issued capital and reserves attributable to

owners of the parent

 

 

 

Share capital

19

502

312

Share premium

 

10,608

-

Merger reserve

 

3,013

(312)

Shares to be issued

 

4,132

-

Capital contribution

 

14,271

6,999

Share option reserve

 

266

-

Foreign currency translation reserve

 

7

-

Retained earnings

 

(1,996)

(2,411)

 

 

_______

_______

 

 

 

 

 

 

30,803

4,588

TOTAL EQUITY

 

_______

_______

 

 

 

 

         

 

The notes in the following pages form part of these financial statements.

 

Stride Gaming Plc

 

Consolidated statement of cash flows

for the year ended 31 August 2015

 

 

 

Note

2015

2014

 

 

£'000

£'000

Cash flows from operating activities

 

 

 

Profit for the year

 

415

846

Adjustments for:

 

 

 

Depreciation of property, plant and equipment

11

47

-

Amortisation of intangible assets

12

2,520

255

Finance expense

5

793

-

Share-based payment expense

 

266

-

Income tax credit

8

(55)

-

 

 

_______

_______

 

 

 

 

 

 

3,986

1,101

 

 

 

 

(Increase) in trade and other receivables

 

(2,450)

(1,339)

Decrease in trade and other payables

 

3,080

238

 

 

_______

_______

 

 

 

 

Cash generated from operations

 

4,616

-

 

 

 

 

Income taxes paid

 

(68)

-

 

 

_______

_______

 

 

 

 

Net cash flows from operating activities

 

 

4,548

-

 

Investing activities

 

 

 

Acquisition of subsidiaries, net of cash acquired

23

(18,061)

-

Purchases of property, plant and equipment

11

(83)

-

Purchase of intangibles

12

(467)

-

Capitalised development costs

12

(246)

-

 

 

_______

_______

 

 

 

 

Net cash used in investing activities

 

(18,857)

-

 

 

 

 

Financing activities

 

 

 

Issue of ordinary shares, net of issue costs

 

10,693

-

Capital contribution from shareholder

 

6,000

 

Proceeds from borrowings

 

8,000

-

Dividends paid

10

(3,000)

-

 

 

_______

_______

 

 

 

 

Net cash (used in)/from financing activities

 

21,693

-

Net increase in cash and cash equivalents

 

7,384

-

Cash and cash equivalents at beginning of year

 

-

-

Exchange (losses)/gains on cash and cash equivalents

 

4

-

 

 

_______

_______

 

 

 

 

 

16

7,388

-

Cash and cash equivalents at end of year

 

_______

________

  

A description of the significant non-cash movements is given in note 26. 

The notes in the following pages form part of these financial statements.

 

Stride Gaming Plc

Consolidated statement of changes in equity

for the year ended 31 August 2015

 

 

Share

capital

Share

Premium

 

Merger

Reserve

Shares to be issued reserve

Capital contribution reserve

Share option reserve

Foreign currency translation reserve

Retained earnings

Total

equity

 

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

 

 

 

 

 

 

 

 

 

 

1 September 2013

312

-

(312)

-

4,999

-

-

(3,257)

1,742

 

 

 

 

 

 

 

 

 

 

Total Comprehensive income for the year

-

-

-

-

-

-

-

846

846

Capital contribution

-

-

-

-

2,000

-

-

-

2,000

 

______

______

______

______

______

______

______

______

______

 

 

 

 

 

 

 

 

 

 

At 31 August 2014

312

-

(312)

-

6,999

-

-

(2,411)

4,588

 

______

______

______

______

______

______

______

______

______

 

 

 

 

 

 

 

 

 

 

Profit for the year

-

-

-

-

-

-

-

415

415

Other comprehensive income

-

-

-

-

-

-

7

-

7

 

______

______

______

______

______

______

______

______

______

Total comprehensive income for the year

-

-

-

-

-

-

7

415

422

 

 

 

 

 

 

 

 

 

 

Contributions by and distributions to owners

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividends

-

-

-

-

(7,500)

-

-

-

(7,500)

Acquisition of business through issue of shares

105

-

3,325

-

-

-

-

-

3,430

Acquisition of intangible assets for shares

-

-

-

4,132

-

-

-

-

4,132

Capital contribution

-

-

-

-

14,772

-

-

-

14,772

Share based payment

-

-

-

-

-

266

-

-

266

Issue of shares, net of share issue costs

85

10,608

-

-

-

-

-

-

10,693

 

______

______

______

______

______

______

______

______

______

 

 

 

 

 

 

 

 

 

 

At 31 August 2015

502

10,608

3,013

4,132

14,271

266

7

(1,996)

30,803

 

______

______

______

______

______

______

______

______

______

 

The following describes the nature and purpose of each reserve within equity:

Share premium - Amount subscribed for share capital in excess of nominal value.

Merger reserve - Represents the difference between the nominal value of shares acquired by the company in the share for share exchange with Daub Alderney Limited and the nominal value of shares issued to acquire them as well the satisfaction of the initial consideration in respect of the acquisition of the trade and assets of Table Top Entertainment Limited.

Shares to be issued - Represents the shares to be issued in respect of the acquisition of certain intangibles assets.

Capital contribution - Represents the release of the Group's obligation to repay borrowings of £6,999,000, the contribution by a shareholder of the entire share capital of Baldo Line SRL, the cash contribution by a shareholder to acquire Spacebar Media Limited and the £8,454,786 payment made in the form of shares by the shareholders to settle obligations following the acquisition of Table Top Entertainment Limited (Refer to note 23).

Share options - Represents the fair value of awards made under the Goup's share option scheme  (Refer to Note 22).

Foreign currency translation reserve - Gains/losses arising on retranslating the net assets of overseas operations into Sterling.

Retained earnings - All other net gains and losses and transactions with owners not recognised anywhere else.

                     

Stride Gaming Plc

 

Notes forming part of the financial statements

for the year ended 31 August 2015

 

 

1

Accounting policies

 

Legal status

 

Stride Gaming Plc which includes its subsidiaries and together forms the "Group" is a public limited liability company incorporated in Jersey. Stride Gaming Plc was incorporated under Jersey law 1991 on  25 February 2015. The address of its registered office is 12 Castle Street, St Helier, Jersey, JE2 3RT. Stride Gaming Plc shares are listed on the Alternative Investment Market ("AIM") of the London Stock Exchange.  The company is not required to present parent company information.

 

Basis of preparation

 

Stride Gaming plc was incorporated on 25 February 2015 and subsequent to this on 19 May 2015 acquired, via a share for share exchange, the entire share capital of the Group headed by Daub Alderney Limited. Following this Group reorganisation the financial statements for the period ended 31 August 2015 have been prepared on a merger accounting basis as though this Group structure had always been in place   (see below for further details) and a full year of results is therefore presented.  The prior year comparatives represent the results of Daub Alderney Limited.

 

The principal accounting policies adopted in the preparation of the consolidated financial statements are set out below and have been prepared on a historical cost basis.  The policies have been consistently applied to all the years presented, unless otherwise stated.

 

The consolidated financial statements are presented in Sterling, which is also the parent's functional currency and amounts are rounded to the nearest thousand, unless otherwise stated.

 

These financial statements have been prepared in accordance with International Financial Reporting Standards as adopted by the European Union, International Accounting Standards and Interpretations (collectively IFRSs) and in accordance with the requirements of the Companies (Jersey) Law 1991.

 

The preparation of financial statements in compliance with EU adopted IFRS requires the use of certain critical accounting estimates.  It also requires Group management to exercise judgment in applying the Group's accounting policies.  The areas where significant judgments and estimates have been made in preparing the financial statements are disclosed below.

 

The financial statements do not constitute the Group's statutory financial statements for the year ended 31 August 2015 or the year ended 31 August 2014.  Statutory accounts will be filed following the Company's Annual General Meeting.  The auditors have reported on these accounts and their report was unqualified.

 

Changes in accounting policies

 

a)     New standards, interpretations and amendments effective from 1 September 2014

 

Where relevant, new standards and amendments to existing IFRS standards that have been published and are mandatory for the first time for the financial year beginning 1 September 2014 have been adopted, but had no significant impact to the Group accounts.

 

b)     New standards, interpretations and amendments not yet effective

 

New standards, amendments to standards and interpretations that have been issued but are not yet effective (and in some cases have not yet been adopted by the EU) including IFRS 9 Financial Instruments and IFRS 15 Revenue from contracts with customers have not been early adopted and directors do not expect that the adoption of these standards will have a material impact on the financial statements of the Group in future periods.

 

Stride Gaming Plc

 

Notes forming part of the financial statements

for the year ended 31 August 2015 (continued)

 

 

1

Accounting policies (continued)

         

Basis of consolidation

 

Group reorganisation

 

The consolidated financial statements shows the combination of Stride Gaming plc and Daub Alderney Limited following the share for share exchange completed on 19 May 2015 which falls outside the scope of IFRS 3 'Business Combinations'.  Accordingly, following the guidance regarding the selection of an appropriate accounting policy provided by IAS 8 'Accounting policies: Changes in accounting estimates and errors', the consolidated financial statements have been prepared using the principles of merger accounting set out in FRS 102 section 19 and UK Generally Accepted Accounting Practice (UK GAAP).

 

Group reorganisation (continued)

 

When merger accounting is applied, the investment is recorded in the company's balance sheet at the nominal value of shares issued together with the fair value of any consideration paid.  In the consolidated financial statements, merged subsidiary undertakings are treated as if they had always been a member of the group from the date common control was achieved.  The corresponding figures for the previous period include its results for that period, the assets and liabilities at the previous balance sheet date and the shares issued by the company as consideration as if they have always been in issue.  Any differences between the nominal value of the shares acquired by the company and the nominal value of shares issued by the company to acquire them are taken to a separate merger reserve.

 

Acquisition of subsidiaries

 

A subsidiary is an entity controlled directly or indirectly by the Company. Control is achieved if all three of the following elements are present: power over the investee, exposure to variable returns from the investee, and the ability of the investor to use its power to affect those variable returns. Control is reassessed whenever facts and circumstances indicate that there may be a change in any of these elements of control.   The cost of the acquisition is measured at the aggregate of the fair values, at the date of exchange, of assets given, liabilities incurred or assumed, and equity instruments issued by the Group in exchange for control of the acquiree.  Acquisition-related costs are recognised in the income statement as incurred.  The acquiree's identifiable assets and liabilities are recognised at their fair values at the acquisition date.

 

The results of subsidiaries acquired or disposed of during the period are included in the consolidated statement of comprehensive income from the date that control was obtained to the date that control was lost, as appropriate. Where necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with those used by the Group.

 

Common control transactions

 

Baldo Line SRL a 100% owned subsidiary was contributed to the Group by the former controlling shareholder.   As this is a common control transaction it is outside the scope of IFRS 3 'Business Combinations'. Accordingly, following the guidance regarding the selection of an appropriate accounting policy provided by IAS 8 'Accounting policies: Changes in accounting estimates and errors', the consolidated financial statements have been prepared using the principles of merger accounting set out in FRS 102 section 19 and UK Generally Accepted Accounting Practice (UK GAAP).  The Group has therefore recognised the book value of assets and liabilities with a corresponding capital contribution being recorded.

 

The 24.5% shareholding in QSB Gaming Limited was also contributed to the Group in the year.  The investment met the definition of an available-for-sale financial asset and was therefore recorded at fair value on initial recognition.

 

Uniform accounting policies have been adopted across the Group. All intra-Group transactions, balances, income and expenses are eliminated on consolidation.

 

 

Stride Gaming Plc

 

Notes forming part of the financial statements

for the year ended 31 August 2015 (continued)

 

 

1

Accounting policies (continued)

 

Foreign currencies

 

Transactions in foreign currencies are recorded at the rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the rate of exchange ruling at the  financial reporting date. Non-monetary assets and liabilities are translated using exchange rates prevailing at the date of the transactions. Foreign exchange differences arising on translation are recognised in the profit or loss account. On consolidation, the results of foreign operations are translated into sterling at rates ruling when the transaction took place. All assets and liabilities of foreign operations, including goodwill arising on the acquisition of those operations, are translated at the rate ruling at the reporting date. Exchange differences arising on translating the opening net assets at the opening rate and the results of foreign operations at the actual rate are recognised in other comprehensive income and accumulated in the foreign currency translation reserve. On disposal of a foreign operation, the cumulative exchange differences recognised in the foreign currency translation reserve relating to that operation up to the date of disposal are transferred to the consolidated statement of comprehensive income and included in the computation of the profit or loss on disposal.

 

Revenue recognition

 

Net gaming revenue (NGR) is derived from online gambling operations and is defined as the difference between the amounts of bets placed by the players less the amount won by players.  It is stated after deduction of certain bonuses, jackpots and prizes granted to players. Revenue is recognised in the accounting periods in which the transactions occur.

 

Social gaming revenue is derived from the purchase of credits and awards on the social gaming sites. Social gaming revenue is recognised to the extent that it is probable economic benefits will flow to the Group and the revenue can be reliably measured. Revenue is recognised in the accounting periods in which the transactions occur.

 

Cost of sales

 

Cost of sales consists primarily of gaming duties.

 

Distribution costs

 

Distribution costs represent the costs of delivering the service to the customer and primarily consist of processing and royalty fees, promotional and advertising costs together with gaming and other regulatory costs all of which are recognised on an accruals basis.

 

Administrative expenses

 

Administrative expenses consist primarily of staff costs, corporate and professional expenses, all of which are recognised on an accruals basis.

 

Goodwill

 

Goodwill represents the excess of the cost of a business combination over the total acquisition date fair value of the identifiable assets, liabilities and contingent liabilities acquired. Cost comprises the fair value of assets given, liabilities assumed and equity instruments issued, plus the amount attributable of any non-controlling interests in the acquisition and dependent on the terms of the sale and purchase agreement, deferred and contingent consideration. 

 

Goodwill is capitalised as an intangible asset with any impairment in carrying value being charged to the profit and loss account.  Costs incurred in respect of the acquisition are expensed in full in the period of acquisition.

 

Stride Gaming Plc

 

Notes forming part of the financial statements

for the year ended 31 August 2015 (continued)

 

 

1

Accounting policies (continued)

 

Contingent consideration

 

When contingent consideration arising on a business combination requires no ongoing employment requirements from the former owners in order to receive payment, the fair value of contingent consideration is included within cost at acquisition date.   

 

Contingent consideration is reviewed at the end of each accounting period as the consideration payable and any subsequent adjustments are recognised in profit or loss account.

 

When the former owners of an acquired subsidiary are required to remain in employment at each of the deferred or contingent consideration payment dates the fair value of contingent consideration is built up over the period of service to the date of payment with a corresponding charge to the profit or loss account.   When future service is required, this is described in the financial statements as contingent remuneration.

 

Externally acquired intangible assets

 

Externally acquired intangible assets including intellectual property rights, developed software applications and licenses are initially recognised at cost and subsequently amortised on a straight-line basis over their useful economic lives which is typically over a period of 3-5 years or over the length of the license.

 

Intangible assets are recognised on business combinations if they are separable from the acquired entity or give rise to other contractual or legal rights. The amounts ascribed to such intangibles are arrived at using appropriate valuation techniques (see section related to critical estimates and judgements below).

 

The significant intangibles recognised by the Group, their useful economic lives and methods used to determine the cost (at initial recognition) of intangibles acquired in a business combination are as follows:

 

 

Intangible asset

Useful economic life

Valuation method

Brands

4 years

Discounted cash flows

Developed software

3 - 10 years

Relief from royalty

Customer relationship

Contractual relationship

5-10 years

5-10 years

Discounted cash flows

Discounted cash flows

 

Amortisation is charged to the profit or loss during the financial period to which it relates.

 

Internally generated intangible assets (development costs)

 

Expenditure on internally developed products is capitalised if it can be demonstrated that:

 

·      it is technically feasible to develop the product for it to be sold;

·      adequate resources are available to complete the development;

·      there is an intention to complete and sell the product;

·      the Group is able to sell the product;

·      sale of the product will generate future economic benefits; and

·      expenditure on the project can be measured reliably.

 

Capitalised development costs are amortised over the periods the Group expects to benefit from the assets generated, being three years.

 

Development expenditure not satisfying the above criteria and expenditure is recognised in the consolidated statement of comprehensive income as incurred.

 

 

 

Stride Gaming Plc

 

Notes forming part of the financial statements

for the year ended 31 August 2015 (continued)

 

 

1

Accounting policies (continued)

 

Property, plant and equipment

 

All property, plant and equipment is stated at cost less accumulated depreciation.   Depreciation is calculated to write-off the cost of fixed assets on a straight line basis over the expected useful lives of the assets concerned. The principal annual rates used for this purpose are:

 

 Fixtures, fittings and equipment

-

20 - 25% straight line

 Computer equipment         

-

33% straight line

 

Subsequent expenditures are included in the carrying amount of an asset or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits will flow to the Group and the cost of the item can be measured reliably. All repairs and maintenance are charged to profit or loss during the financial period in which they are incurred.

 

Gains and losses on disposals are determined by comparing proceeds with the carrying amount and are included in the profit or loss.

 

Impairment of property, plant and equipment and internally generated assets

 

Impairment tests on goodwill and other intangible assets with indefinite useful economic lives are undertaken annually at the financial year end.  Other non-financial assets are subject to impairment tests whenever events or changes in circumstances indicate that their carrying amount may be impaired and hence not recoverable.  Where the carrying value of an asset exceeds its recoverable amount (i.e. the higher of value in use and fair value less costs to sell), the asset is written down to its recoverable amount.

 

Where it is not possible to estimate the recoverable amount of an individual asset, the impairment test is carried out on the smallest group of assets to which it belongs for which there are separately identifiable cash flows; its cash generating units ('CGUs').  Goodwill is allocated on initial recognition to each of the Group's CGUs that are expected to benefit from the synergies of the combination giving rise to the goodwill.

 

Impairment charges are included in the profit or loss account, an impairment loss recognised for goodwill is not reversed.

 

Financial instruments

 

Financial assets and financial liabilities are recognised on the Group's statement of financial position when the Group becomes party to the contractual provisions of the instrument. Financial assets are de-recognised when the contractual rights to the cash flows from the financial asset expire or when the contractual rights to those assets are transferred. Financial liabilities are de-recognised when the obligation specified in the contract is discharged, cancelled or expired.  Financial assets are either categorised as loans or receivables or available for sale.  There are no assets classified as held-to-maturity or fair value through profit or loss.  All financial liabilities are classified as amortised cost.

 

 

 

Stride Gaming Plc

 

Notes forming part of the financial statements

for the year ended 31 August 2015 (continued)

 

 

1

Accounting policies (continued)

 

Financial instruments (continued)

 

Financial assets:

  

Trade receivables

 

Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method less provision for impairment. Appropriate provisions for estimated irrecoverable amounts are recognised in profit or loss account when there is objective evidence that the assets are impaired. Interest income is recognised by applying the effective interest rate, except for short term receivables when the recognition of interest would be immaterial.

 

Impairment provisions are recognised when there is objective evidence (such as significant financial difficulties on the part of the counterparty or default or significant delay in payment) that the Group will be unable to collect all of the amounts due under the net carrying amount and the present value of the future expected cash flows associated with the impaired receivable.  For trade receivables, which are reported net; such provisions are recorded in a separate allowance account with the loss being recognised within administrative expenses in the statement of comprehensive income.  On confirmation that the trade receivable will not be collectable, the gross carrying value of the asset is written off against the associated provision.

 

Cash and cash equivalents

 

Cash and cash equivalents comprise cash held at bank, demand deposits, and other short-term highly liquid investments that have maturities of three months or less from inception, are readily convertible to a known amount of cash and are subject to an insignificant risk of changes in value.

 

Available-for-sale

 

Non-derivative financial assets not included in the above categories are classified as available-for-sale and comprise principally the Group's strategic investments in entities not qualifying as subsidiaries, associates or jointly controlled entities.  They are carried at fair value with changes in fair value, other than those arising due to exchange rate fluctuations and interest calculated using the effective interest rate, recognised in other comprehensive income and accumulated in the available-for-sale reserve.  Exchange differences on investments denominated in a foreign currency and interest calculated using the effective interest rate method are recognised in the profit or loss statement. 

 

Where there is a significant or prolonged decline in the fair value of an available for sale financial asset (which constitutes objective evidence of impairment), the full amount of the impairment, including any amount previously recognised in other comprehensive income, is recognised in profit or loss.

 

On sale, the cumulative gain or loss recognised in other comprehensive income is reclassified from the available-for-sale reserve to profit or loss. 

 

 

Stride Gaming Plc

 

Notes forming part of the financial statements

for the year ended 31 August 2015 (continued)

 

 

1

Accounting policies (continued)

 

  Financial instruments (continued)

 

             Financial liabilities:

 

Trade and other payables

 

Trade payables are initially measured at their fair value and are subsequently measured at amortised cost using the effective interest rate method; this method allocates interest expense over the relevant period by applying the 'effective interest rate' to the carrying amount of the liability. Player liabilities are the amounts that customers place in their accounts along with any bonuses and progressive jackpots. These liabilities are recognised initially at fair value and subsequently at amortised cost.

 

Loans and borrowings

 

Loans and borrowings are initially recognised at fair value net of any transaction costs directly attributable to the issue of the instrument.  Such interest bearing liabilities are subsequently measured at amortised cost using the effective interest rate method, which ensures that any interest expense over the period to repayment is at a constant rate on the balance of the liability carried in the consolidated statement of financial position.

 

Current and deferred tax

 

Taxation represents the sum of the tax currently payable and deferred tax.

 

Current tax

 

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit

reported in the consolidated statement of comprehensive income because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The Group's liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting date.               

                                                                                                                                                             

Deferred tax                                                                                                 

 

Deferred tax is calculated at the tax rates that are expected to apply to the period when the asset is realised or the liability is settled based upon tax rates that have been enacted or substantively enacted by the reporting date. Deferred tax is charged or credited to profit or loss, except when it relates to items credited or charged directly to equity, in which case the deferred tax is also dealt with in equity through other comprehensive income.

 

Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the financial information and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method. Deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised.

 

The carrying amount of deferred tax assets is reviewed at each consolidated statement of comprehensive income date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.

 

Deferred tax is measured using tax rates that have been enacted or substantively enacted by the consolidated statement of financial position date and are expected to apply when the related deferred tax asset or liability is realised or settled.

 

 

Stride Gaming Plc

 

Notes forming part of the financial statements

for the year ended 31 August 2015 (continued)

 

 

1

Accounting policies (continued)

 

 

Operating leases

 

Where substantially all of the risks and rewards incidental to ownership are not transferred to the Group, these are classified as operating leases. The total rentals payable under the lease are charged to profit or loss on a straight-line basis over the lease term.

 

Pension costs

 

The Group operates a defined contribution scheme. The amount charged to the profit or loss account in respect of pension costs and other post-retirement benefits is the contributions payable in the period. Differences between contributions payable in the period and contributions actually paid are shown as either other liabilities or prepayments in the consolidated statement of financial position.        

 

Share capital

 

Financial instruments issued by the Group are classified as equity only to the extent that they do not meet the definition of a financial liability or financial asset.

 

Share-based payments

 

Where equity settled share options are awarded to employees (refer to Note 22), the fair value of the options at the date of grant is charged to the profit and loss account over the vesting period.  Non-market vesting conditions are taken into account by adjusting the number of equity instruments expected to vest at each reporting date so that, ultimately, the cumulative amount recognised over the vesting period is based on the number of options that eventually vest.  Non-vesting conditions and market vesting conditions are factored into the fair value of the options granted.  As long as all other vesting conditions are satisfied, a charge is made irrespective of whether the market vesting conditions are satisfied.  The cumulative expense is not adjusted for failure to achieve a market vesting condition or where a non-vesting condition is not satisfied.

 

Where equity instruments are granted to persons other than employees, the profit or loss account is charged with the fair value of goods and services received, or in the case of an asset, recorded within the appropriate classification.

 

National insurance is payable on gains made by employees on exercise of share options granted to them.  The eventual liability to National Insurance is dependent on:

 

- The market price of the company's shares at the date of exercise

- The number of options that will be exercised, and

- The prevailing rate of National Insurance at the date of exercise.

 

At each period end the potential liability is recorded as an expense within the profit and loss account and a corresponding provision recorded.

 

Dividends

 

Dividends are recognised when they become legally payable.  In the case of interim dividends this is when paid and in the case of final dividends, this is when approved by the shareholders at the AGM. 

 

Adjusted EBITDA

 

The Group defines Adjusted EBITDA as the operating result before depreciation, amortisation, finance costs, and income or expenses that relate to exceptional items as well as non-cash charges relating to share-based payments (including employers national insurance). The Directors believe that Adjusted EBITDA represents more closely the underlying trading performance of the business.

 

Stride Gaming Plc

 

Notes forming part of the financial statements

for the year ended 31 August 2015 (continued)

 

 

1

Accounting policies (continued)

 

Critical accounting estimates

 

The preparation of the consolidated financial statements under IFRS requires the Group to make estimates and judgments that affect the application of policies and reported amounts. Estimates and judgments 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. Actual results may differ from these estimates. Reference is made in this note to accounting policies which cover areas that the Directors consider require estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities within the next financial year.

 

Acquisition accounting and fair value of acquired assets and liabilities including contingent consideration

 

Identifiable assets, liabilities and contingent liabilities, including earn-outs that meet the conditions for recognition under IFRS 3 are recognised at their fair value at the acquisition date. The identified intangibles are capitalised if they are separable from the acquired entity or give rise to other contractual or legal rights. The amounts ascribed to these assets are arrived at by using appropriate valuation techniques to determine the fair value. Capitalised intangible assets are amortised over the useful economic life of the assets. This has ranged between three to five years for acquisitions to date. The fair value of contingent consideration, including earn-outs is based on the probability of expected cash flow outcomes and the assessment of present values using appropriate discount rates. Further details in relation to key estimates and judgements are set out in Notes 23.

 

 

Capitalisation and amortisation of development costs

The identification of development costs that meet the criteria for capitalisation is dependent on management's judgement and knowledge of the work done. Development costs of gaming software platforms are separately identified. Judgements are based on the information available at each period end. Economic success of any development is assessed on a reasonable basis but remains uncertain at the time of recognition. Capitalised development costs are subject to amortisation over its useful life and reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. The Group amortises the assets over the life of the product. The estimated useful life of these assets at period end is three years.

 

 

Stride Gaming Plc

 

Notes forming part of the financial statements

for the year ended 31 August 2015 (continued)

 

 

Segment information

 

For management purposes and for transacting with customers, the Group's operations can be segmented into the following reporting segments:

 

·      Real money gaming which is its UK focused, bingo-led online operation, using its proprietary and purchased software to provide online bingo and related gaming activities to players. This segment only operates in regulated markets, principally the UK; and

·      Social gaming which internationally provides players with entertaining applications and games.

 

Each of these operating segments generates independent revenues, and the risks and rewards associated with generating these revenues are considered to be different to each other.

 

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision maker has been identified as the management team including the Chief Executive Officer, Chief Operating Officer and the Chief Financial Officer.

 

The Group evaluates segmental performance on the basis of profit or loss from operations calculated in accordance with IFRS but excluding non-recurring losses, IPO and acquisition costs, and the effects of share-based payments. There are no inter-segment sales.

 

 

 

 

 

 

Real money Gaming

Social gaming

Total

 

 

 

 

2015

2015

2015

 

 

 

 

£'000

£'000

£'000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenue from external customers

 

 

26,695

1,116

27,811

 

 

 

 

_______

_______

_______

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

 

 

7,044

271

7,315

 

 

 

 

_______

_______

 

 

 

 

 

 

 

 

 

Depreciation

 

 

(44)

(3)

(47)

 

Amortisation

 

 

(2,336)

(184)

(2,520)

 

 

 

 

_______

_______

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Acquisition costs

(1,893)

 

Listing costs

(1,179)

 

Share-based payments including national insurance

(306)

 

Finance expense

(793)

 

Contingent remuneration

(217)

 

 

_______

 

 

 

 

Group profit before tax

360

 

 

_______

 

 

Stride Gaming Plc

 

Notes forming part of the financial statements

For the year ended 31 August 2015 (continued)

 

 

Segment information (continued)

 

 

 

 

 

 

Real money Gaming

Social gaming

Total

 

 

 

 

2014

2014

2014

 

 

 

 

£'000

£'000

£'000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenue from external customers

 

 

8,489

-

8,489

 

 

 

 

_______

_______

_______

 

 

 

 

 

 

 

 

Group's revenue per consolidated statement of comprehensive income

 

 

8,489

-

8,489

 

 

 

 

_______

_______

_______

 

 

 

 

 

 

 

 

Adjusted EBITDA

 

 

1,191

-

1,191

 

 

 

 

_______

_______

 

 

 

 

 

 

 

 

 

Amortisation

 

 

(255)

-

(255)

 

 

 

 

_______

_______

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Listing costs

(90)

 

 

_______

 

 

 

 

Group profit before tax

846

 

 

_______

                 

 

 

 

 

 

External revenue by

Non-current assets

 

 

location of customers

by location of assets

 

 

2015

2014

2015

2014

 

 

£'000

£'000

£'000

£'000

 

 

 

 

 

 

 

United Kingdom

26,188

8,384

6,000

-

 

Alderney

-

-

14,096

-

 

Israel

-

-

16,079

-

 

Other

1,623

105

426

-

 

 

_______

_______

_______

_______

 

 

 

 

 

 

 

 

27,811

8,489

36,601

-

 

 

_______

_______

_______

_______

 

 

 

 

 

Stride Gaming Plc

 

Notes forming part of the financial statements

For the year ended 31 August 2015 (continued)

 

 

3

Operating profit

 

Operating profit is stated after charging the following:

 

 

2015

2014

 

 

£'000

£'000

 

 

 

 

 

Operating lease expenses

127

-

 

Employee benefit expenses (note 4)

3,694

9

 

Depreciation of property, plant and equipment

47

-

 

Amortisation of intangible assets

2,520

255

 

Auditor's remuneration - audit services

66

42

 

Auditor's remuneration - other assurance services

8

-

 

Auditor's remuneration - tax advisory services

74

-

 

Auditor's remuneration - corporate finance services

191

90

 

Listing costs (a)

1,179

-

 

Acquisition costs (b)

1,893

-

 

Share based payments (c)

306

-

 

Contingent remuneration (d)

217

-

 

 

_______

_______

                                                                                                                                                                        

(a)   Listing costs relate to the Group's initial public offering and admission on AIM which completed on 19 May 2015. This excludes any costs associated with the issue of equity which has been allocated against share premium.

(b)   Acquisition costs relate to the acquisition of the entire share capital of InfiApps Ltd during the year. Refer to Note 23 for further information.

(c)   During the year the company issued share options to certain employees and consultants of the Group.  The charge for the year includes national insurance. Refer to Note 22 for further information.

(d)   Under the terms of the InfiApps Ltd acquisition the contingent remuneration payable is linked to future employment and therefore has been charged to the profit and loss account. Refer to Note 23 for further details.

 

4

Employee benefit expenses

 

 

 

 

2015

2014

 

 

£'000

£'000

 

Employee benefit expenses (excluding directors and key management personnel)

 

 

 

Wages and salaries

2,014

-

 

Pension costs

12

-

 

Social security contributions and similar taxes

79

-

 

 

_______

_______

 

 

 

 

 

 

2,105

-

 

Benefit expenses of directors and key management personnel (a)

 

 

 

Wages and salaries

1,180

9

 

Pension costs

15

-

 

Share-based payment expense (note 22)

222

-

 

Social security contributions and similar taxes

172

-

 

 

_______

_______

 

 

 

 

 

 

1,589

9

 

 

 

 

 

Total employee benefit expense including directors and key management personnel

 

3,694

 

9

 

 

 

_______

_______

 

 

 

 

Stride Gaming Plc

 

Notes forming part of the financial statements

For the year ended 31 August 2015 (continued)

 

 

 

4

Employee benefit expenses (continued)

 

(a)    Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the Group, including the directors of the company (listed in Note 7) as well as certain Directors of subsidiary companies.

 

 

5

Finance expense

 

 

 

 

 

 

 

Recognised in statement of comprehensive income

 

 

 

 

2015

2014

 

 

£'000

£'000

 

 

 

 

 

Loan interest (note 17)

51

-

 

Unwinding of discount on Table Top Entertainment Limited contingent consideration (note 23)

 

742

 

-

 

 

_______

_______

 

 

 

 

 

Total finance expense

793

-

 

 

_______

_______

 

 

 

 

6

Available for sale investment

 

 

 

 

On 1 December 2014, a related party to the Group contributed its 24.5 per cent. investment in the equity share capital of QSB Gaming Limited by way of a capital contribution. QSB Gaming Limited, a company based in Alderney, is an operator of online casino and bingo gaming sites in the Spanish market.

Despite holding greater than 20 per cent. of the voting equity instruments in QSB Gaming Limited, the

Directors do not believe that they exercise significant influence over the investee. This is on the basis that

the Group has no representation on the board and no participation in decisions over operating and financial policies. The Group has therefore recorded the asset as an available for sale investment at fair value of £1. The fair value is based on the fact that QSB Gaming Limited is in early development stages and future regulatory developments are uncertain.

 

 

 

 

 

 

 

 

 

Stride Gaming Plc

 

Notes forming part of the financial statements

For the year ended 31 August 2015 (continued)

 

 

7

Directors' interests and remuneration

 

The directors who served during the year, and their interests in the share capital of the company, were as follows:

 

                                   £0.01 ordinary shares

 

Number of shares

Percentage Holding

Number of shares

Percentage Holding

 

 

At 31 August 2015

At 31 August 2014

 

 

 

 

 

 

 

Nigel Terrence Payne

-

-

-

-

 

Stuart Eitan Boyd

2,249,999*

4.49%

-

-

 

Darren Brett Sims

937,498*

1.87%

-

-

 

Ronen Kannor

-

-

-

-

 

John Le Poidevin

37,879

0.08%

-

-

 

Adam David Batty

22,727

0.05%

-

-

 

 

 

 

 

 

 

 

                           * Shares held via trusts

 

                   The following directors held share options as at 31 August 2015:

 

 

Number of options at 31 August 2015

Date of grant

Exercise price in £

Vesting period of options

 

 

 

 

 

Stuart Eitan Boyd

750,000

18 May 2015

1.32

1 - 3 years

Darren Brett Sims

750,000

18 May 2015

1.32

1 - 3 years

Ronen Kannor

500,000

18 May 2015

1.32

1 - 3 years

 

 

The following table presents the Directors' remunerations of the Company for the year ended 31 August 2015:

 

 

 

 

 

 

 

 

 

 

 

 

Salaries

 

 

Share

Total

Total

 

 

 

and fees

Benefits

Bonus

Options

2015

2014

 

 

 

£'000

£'000

£'000

£'000

£'000

£'000

 

 

 

 

 

 

 

 

 

 

 

Nigel Payne

16

-

15

-

31

-

 

 

Eitan Boyd

117

8

252

66

443

-

 

 

Darren Sims

114

8

252

66

440

-

 

 

Ronen Kannor

69

4

156

45

274

-

 

 

John Le Poidevin

13

-

15

-

28

-

 

 

Adam Batty

7

-

15

-

22

-

 

 

 

_______

_______

_______

_______

_______

_______

 

 

 

 

 

 

 

 

 

 

 

Total

336

20

705

177

1,238

-

 

 

 

_______

_______

_______

_______

_______

_______

 

 

 

Stride Gaming Plc

 

Notes forming part of the financial statements

For the year ended 31 August 2015 (continued)

 

 

8

Tax expense

 

 

 

 

2015

2014

 

 

£'000

£'000

 

Tax expense

 

 

 

 

 

 

 

Current tax expense

 

 

 

Current tax on profits for the year

80

-

 

 

_______

_______

 

 

 

 

 

Total current tax

80

-

 

 

 

 

 

 

 

 

 

Deferred tax expense

 

 

 

Origination and reversal of temporary differences (Note 18)

(135)

-

 

 

_______

_______

 

 

 

 

 

Total deferred tax

(135)

-

 

 

_______

_______

 

 

 

 

 

Total tax credit

(55)

-

 

 

_______

_______

 

 

 

 

The reasons for the difference between the actual tax charge for the year and the standard rate of corporation tax in the United Kingdom applied to profits for the year are as follows:

 

 

 

2015

2014

 

 

£'000

£'000

 

 

 

 

 

Profit for the year

360

846

 

 

_______

_______

 

 

 

 

 

Tax using the Company's domestic tax rate of 20.6 % (2014 - 22.2 %)

74

188

 

Expenses not deductible for tax purposes

825

-

 

Different tax rates applied in overseas jurisdictions

(954)

(188)

 

 

_______

_______

 

 

 

 

 

Total tax credit

(55)

-

 

 

_______

_______

 

 

Stride Gaming Plc

 

Notes forming part of the financial statements

For the year ended 31 August 2015 (continued)

 

 

9

Earnings per share

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

2014

 

Numerator

 

 

 

 

£'000

£'000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings used in diluted EPS

 

 

 

 

415

846

 

 

 

 

 

 

_______

_______

 

 

 

 

 

 

 

 

 

Denominator

 

 

 

 

'000

'000

 

 

 

 

 

 

 

 

 

Weighted average number of shares used in basic EPS

 

 

 

 

43,770

31,202

 

 

 

 

 

 

 

 

 

Effects of:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Employee share options

 

 

 

 

177

-

 

 

 

 

 

 

 

 

 

Contingent share consideration on acquisition of intangible

 

 

 

 

607

-

 

 

 

 

 

 

_______

_______

 

Weighted average number of shares used in diluted EPS

 

 

 

 

44,554

31,202

 

 

 

 

 

 

_______

_______

 

 

10

Dividends

 

 

 

On 13 April 2015 Daub Alderney Limited declared a pre-IPO dividend totalling £7,500,000 comprising of

£4,500,000 to be allocated against a receivable due from a related party and shareholder and

the remaining £3,000,000 paid in cash. The directors are not proposing any further dividend for the year (2014 - Nil).

 

 

 

Stride Gaming Plc

 

Notes forming part of the financial statements

For the year ended 31 August 2015 (continued)

 

 

11

Property, plant and equipment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fixtures,

 

 

 

 

 

 

 

fittings and

Computer

 

 

 

 

 

 

equipment

equipment

Total

 

 

 

 

 

£'000

£'000

£'000

 

Cost or valuation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

At 1 September 2013 & 2014

 

 

 

-

-

-

 

Acquired through business combinations

57

141

198

 

Additions

 

 

 

20

63

83

 

 

 

 

 

_______

_______

_______

 

 

 

 

 

 

 

 

 

At 31 August 2015

 

 

 

77

204

281

 

 

 

 

 

_______

_______

_______

 

 

 

 

 

 

 

 

 

 

Accumulated depreciation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

At 1 September 2013 & 2014

 

 

 

-

-

-

 

Charge for the year

 

 

 

5

42

47

 

 

 

 

 

_______

_______

_______

 

 

 

 

 

 

 

 

 

At 31 August 2015

 

 

 

5

42

47

 

 

 

 

 

_______

_______

_______

 

 

 

 

 

 

 

 

 

Net book value

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

At 1 September 2013

 

 

 

-

-

-

 

 

 

 

 

 

 

 

 

At 31 August 2014

 

 

 

-

-

-

 

 

 

 

 

 

 

 

 

At 31 August 2015

 

 

 

72

162

234

 

 

 

 

 

_______

_______

_______

 

 

Stride Gaming Plc

 

Notes forming part of the financial statements

For the year ended 31 August 2015 (continued)

 

 

12

Intangible assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Customer

 

 

 

Software and

Development

Brand

 

and contractual

 

 

 

Licenses

costs

Names

Goodwill

relationships

Total

 

 

£'000

£'000

£'000

£'000

£'000

£'000

 

 

 

 

 

 

 

 

 

Cost

 

 

 

 

 

 

 

 

At 1 September 2013 & 2014

 

-

 

-

 

-

 

-

 

-

 

-

 

Acquired through business combinations

 

 

8,109

 

 

-

 

 

2,265

 

 

14,866

 

 

7,925

 

 

33,165

 

Additions

5,476

-

-

-

-

5,476

 

Internally generated development costs

 

 

 

-

 

 

 

246

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

246

 

 

_______

_______

_______

_______

_______

_______

 

 

 

 

 

 

 

 

 

At 31 August 2015

13,585

246

2,265

14,866

7,925

38,887

 

 

_______

_______

_______

_______

_______

_______

 

 

 

Accumulated amortisation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

At 1 September 2013 & 2014

 

-

 

-

 

-

 

-

 

-

 

-

 

Charge for the year

1,051

18

317

-

1,134

2,520

 

Foreign exchange rate movements

-

-

-

-

-

-

 

 

_______

_______

_______

_______

_______

_______

 

 

 

 

 

 

 

 

 

At 31 August 2015

1,051

18

317

-

1,134

2,520

 

 

_______

_______

_______

_______

_______

_______

 

 

 

 

 

 

 

 

 

Net book value

 

 

 

 

 

 

 

At 1 September 2013

 

-

 

-

 

-

 

-

 

-

 

-

 

 

 

 

 

 

 

 

 

At 31 August 2014

 

-

 

-

 

-

 

-

 

-

 

-

 

 

 

 

 

 

 

 

 

At 31 August 2015

 

12,534

 

228

 

1,948

 

14,866

 

6,791

 

36,367

 

 

_______

_______

_______

_______

_______

_______

 

 

Stride Gaming Plc

 

Notes forming part of the financial statements

For the year ended 31 August 2015 (continued)

 

 

12

Intangible assets (continued)

 

 

          Software and Licenses

 

Included within software and licenses additions is the acquired software and related programs from NextTec Software Inc in respect of the underlying gaming platform and software used by Table Top Entertainment. The contingent consideration payable is based on a percentage of Net Gaming Revenue generated from the use of the software up to a maximum of £5,325,000.  The amounts are payable on the first, second and third anniversary and will be settled through the issue of shares. The number of shares issued to satisfy the liabilities arising on the anniversary dates will be based on the average share price for the previous 30 days as adjusted to reflect a minimum market capitalisation of £75 million. The asset acquired has therefore been fair valued at the date of the acquisition and an intangible asset recorded of £4,132,000 with a corresponding entry to the shares to be issued reserve.

 

Other additions include licenses and other software related assets.

 

          Goodwill

         

          Goodwill is allocated to the following cash generating units

 

 

 

 

 

 

 

2015

2014

 

 

 

 

 

 

£'000

£'000

 

 

 

 

 

 

 

 

 

Spacebar Media

5,936

-

 

Table Top Entertainment

4,008

-

 

Social Gaming

4,922

-

 

 

 

 

 

 

_______

_______

 

 

 

 

 

 

 

 

 

 

 

 

 

 

14,866

-

 

 

 

 

 

 

_______

_______

 

 

 

 

 

 

 

 

                   

        Impairment review

        

In accordance with IAS 36 Impairment of Assets, the Group regularly monitors the carrying value of its intangible assets. A detailed review was undertaken at 31 August 2015 to assess whether the carrying value of assets was supported by the net present value of future cash flows derived from those assets. The recoverable amounts of all the above CGUs have been determined from value in use calculations based on cash flow projections from formally approved budgets and long-term forecasts. These budgets and forecasts assume the underlying business models will continue to operate on a comparable basis under the current regulatory and taxation regimes, adjusted for any known changes.

 

Table Top Entertainment and Spacebar Media CGUs

 

The recoverable amounts of the Table Top Entertainment and Spacebar Media have been determined from value in use calculations based on cash flow projections covering the following five-year period and a calculation into perpetuity which exceeds the total values of each CGUs assets.

 

The cashflows for 2016 and 2017 are based on board approved budgets with a long term growth rate of 2% and a discount rate of 13.9%.  These assumptions were based upon management's experience, past performance and drawing on industry data where relevant. 

 

The Directors have concluded that there are no reasonably possible changes in the key assumptions which would cause the carrying value of goodwill and other intangibles to exceed their value in use.

 

Stride Gaming Plc

 

Notes forming part of the financial statements

For the year ended 31 August 2015 (continued)

 

 

12

Intangible assets (continued)

 

          Social Gaming CGU

 

The goodwill and related assets included within this CGU resulted from the acquisition of InfiApps Ltd (refer to Note 23) which completed on 31 July 2015. The recoverable amount, which exceeds the total value of the CGUs assets has been determined from value in use calculations based on cash flow projections covering the following five-year period and a calculation into perpetuity.

 

The cashflows for 2016 and 2017 are based on board approved budgets with a long term growth rate of 2% and a discount rate of 20%.  These assumptions were based upon management's experience, past performance and drawing on industry data where relevant. 

 

The Directors have concluded that there are no reasonably possible changes in the key assumptions which would cause the carrying value of goodwill and other intangibles to exceed their value in use.

 

13

Subsidiaries

 

The principal subsidiaries of Stride Gaming Plc, all of which have been included in these consolidated financial statements, are as follows:

 

 

 

 

 

 

 

Country of

Proportion of ownership

 

 

Name

incorporation

interest at 31 August

 

 

 

 

2015

2014

 

 

 

Spacebar Media Limited

United Kingdom

100%

0%

 

 

 

SRG Services Limited*

Mauritius

100%

0%

 

 

 

Shifttech (Pty) Limited*

South Africa

100%

0%

 

 

 

Daub Alderney Limited

Alderney

100%

100%

 

 

 

S.T.R Financials Ltd

Israel

100%

0%

 

 

 

InfiApps Ltd*

Israel

100%

0%

 

 

 

Baldo Line*

Italy

100%

0%

 

 

 

 

 

 

 

 

 

 

* Investment held indirectly

 

 

 

 

 

14

Trade and other receivables

 

 

 

 

2015

2014

 

 

£'000

£'000

 

Current

 

 

 

Trade receivables

1,695

68

 

Other receivables

279

290

 

Amounts due from related parties

1,211

5,389

 

Prepayments

1,056

-

 

 

_______

_______

 

 

 

4,241

5,747

 

 

_______

_______

 

 

 

 

 

Non-current

 

 

 

Other receivables

248

83

 

 

_______

_______

 

 

 

248

83

 

 

_______

_______

 

 

Stride Gaming Plc

 

Notes forming part of the financial statements

For the year ended 31 August 2015 (continued)

 

 

14

Trade and other receivables (continued)

 

The carrying value of trade and other receivables classified as loans and receivables approximates fair value. All amounts shown in short term trade and other receivables fall due for payment within 1 year. All non-current receivables are due within 3 years of 31 August 2015.

 

As at 31 August 2015 there were no trade receivables (2014 - £NIL) which were past due and fully impaired. There is currently no provision for impairment for any of the outstanding trade and other receivables (2014 - £NIL).

 

15

Trade and other payables

 

 

 

 

2015

2014

 

 

£'000

£'000

 

Current

 

 

 

Trade payables

1,688

434

 

Other payables

103

-

 

Other taxation and social security

981

-

 

Client liabilities  and progressive prize pools

1,420

427

 

Contingent remuneration

172

-

 

Amounts due to related parties

232

218

 

Accruals and deferred income

1,989

163

 

 

_______

_______

 

 

 

 

 

 

6,585

1,242

 

 

_______

_______

 

 

 

 

 

 

 

 

 

Non-current

Contingent remuneration

 

45

 

-

 

Other payables

55

-

 

 

 

 

 

 

_______

_______

 

 

 

100

-

 

 

_______

_______

 

The carrying value of trade and other payables classified as financial liabilities measured at amortised cost approximates fair value. The contingent remuneration has arisen as a result of the InfiApps acquisition (refer to note 23).

 

 

 

 

 

16

Cash and cash equivalent

 

 

 

2015

2014

 

 

£'000

£'000

 

 

 

 

 

Cash at bank and in hand

7,388

-

 

 

_______

_______

 

 

 

 

Cash held on behalf of players is held in a separate (unrestricted) bank account. In the previous year, a company related by common shareholders held cash on behalf of the Group (refer to Note 24).

 

 

Stride Gaming Plc

 

Notes forming part of the financial statements

For the year ended 31 August 2015 (continued)

 

 

17

Loans and borrowings

 

The book value and fair value of loans and borrowings are as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2015

2014

 

 

 

 

£'000

£'000

 

 

 

 

 

 

 

Unsecured borrowings

 

 

 

 

 

Current (a)

 

 

1,083

-

 

 

 

 

_______

_______

 

Unsecured borrowings

 

 

 

 

 

Non-Current (b)

 

 

8,000

-

 

 

 

 

_______

_______

 

 

 

 

 

 

 

 

 

 

 

 

(a)   The short term interest free borrowings are due to the previous owners of the InfiApps Ltd business. These will be repaid in accordance with the terms of the sale and purchase agreement within two months from the year end.  

(b)   The full value of the borrowings as at 31 August 2015 is repayable in sterling on 30 July 2017, although the Group has the right to repay the whole or any part of the borrowings at any time before this date. The borrowings are incurring interest at 7.5 per cent per annum, paid monthly in arrears.

 

18

Deferred tax

 

Deferred tax is calculated in full on temporary differences under the liability method using a tax rate based on the difference jurisdictions it arises.

 

The movement on the deferred tax accounts is as shown below:

 

 

 

Deferred tax asset

Deferred tax liability

 

 

£'000

£'000

 

 

 

 

 

At 1 September 2013 and 2014

-

-

 

 

 

 

 

Recognised in profit and loss - tax credit

110

25

 

Arising on business combination

121

(2,158)

 

 

_______

_______

 

 

 

 

 

At 31 August 2015

231

2,133

 

 

_______

_______

 

 

 

 

 

 

 

 

 

Deferred tax assets have been recognised in respect of other temporary differences where the directors believe it is probable that these assets will be recovered.

 

The movements in deferred tax assets and liabilities (prior to the offsetting of balances within the same jurisdiction as permitted by IAS 12) during the period are shown below:

 

 

 

Stride Gaming Plc

 

Notes forming part of the financial statements

For the year ended 31 August 2015 (continued)

 

 

18

Deferred tax (continued)

 

Details of the deferred tax liability, amounts recognised in profit or loss and amounts recognised in other comprehensive income are as follows:

 

 

 

 

 

 

(Charged)/

 

 

 

 

 

 

credited

(Charged)/

 

 

 

 

 

to profit

credited to

 

 

Asset

Liability

Net

or loss

equity

 

 

2015

2015

2015

2015

2015

 

 

£'000

£'000

£'000

£'000

£'000

 

 

 

 

 

 

 

 

Share options

110

-

110

110

-

 

Other temporary and

deductible differences

-

-

-

-

-

 

Business combinations

121

(2,133)

(2,012)

25

-

 

 

_______

_______

_______

_______

_______

 

 

 

 

 

 

 

 

Tax asset/(liabilities)

231

(2,133)

(1,902)

135

-

 

Set off of tax

-

-

-

-

-

 

 

_______

_______

_______

_______

_______

 

 

 

 

 

 

 

 

Net tax assets/(liabilities)

231

(2,133)

(1,902)

135

-

 

 

_______

_______

_______

_______

_______

 

 

 

 

 

 

 

There were no deferred tax assets or liabilities at 31 August 2014.
 

Stride Gaming Plc

 

Notes forming part of the financial statements

For the year ended 31 August 2015 (continued)

 

 

19

Share capital

 

 

 

 

 

 

Authorised

 

 

2015

2015

2014

2014

 

 

Number

£'000

Number

£'000

 

 

 

 

 

 

 

Total ordinary shares of 1p each

250,000,000

2,500

250,000,000

2,500

 

 

 

 

 

 

 

 

__________

__________

__________

__________

 

 

 

 

 

 

 

 

Issued and fully paid

 

 

2015

2015

2014

2014

 

 

Number

£'000

Number

£'000

 

 

 

 

 

 

 

Ordinary shares of 1p each

 

 

 

 

 

At 1 September

31,201,955

312

31,201,955

312

 

Issued on acquisition of business

10,464,512

105

-

-

 

Issued on Initial public offering

8,484,848

85

-

-

 

 

__________

__________

__________

__________

 

 

 

 

 

 

 

At 31 August

50,151,315

502

31,201,955

312

 

 

__________

__________

__________

__________

 

 

 

 

 

 

The prior year share capital reflects the shares issued to acquire Daub Alderney Limited on 25 February 2015.  As per note 1, in line with the requirements of merger accounting the structure and share capital issued has been recorded as though it had always been in place.

 

20

Leases

 

Operating leases - lessee

 

The total future value of minimum lease payments in respect of lease properties is as follows:

 

 

 

2015

2014

 

 

£'000

£'000

 

 

 

 

 

Not later than one year

227

-

 

Later than one year and not later than five years

309

-

 

 

_______

________

 

 

 

 

 

 

536

-

 

 

_______

________

 

21

Financial instruments - Risk Management

 

The Group is exposed through its operations to the following financial risks:

 

·      Market risk

·      Credit risk

·      Liquidity risk; and

·      Foreign exchange risk.

 

The Group is exposed to risks that arise from its use of financial instruments.  This note describes the Group's objectives, policies and processes for managing those risks and the methods used to measure them.  Further quantitative information in respect of these risks is presented below.

 

 

 

Stride Gaming Plc

 

Notes forming part of the financial statements

For the year ended 31 August 2015 (continued)

 

 

21

Financial instruments - Risk Management (continued)

 

There have been no substantive changes in the Group's exposure to financial instrument risks, its objectives, policies and processes for managing those risks or the methods used to measure them from previous periods unless otherwise stated in this note.

 

Principal financial instruments

 

The principal financial instruments used by the Group, from which financial instrument risk arises, are as follows:

 

·      Trade and other receivables

·      Investment in available for sale financial instruments

·      Cash and cash equivalents

·      Trade and other payables

·      Loans and borrowings

 

Financial instruments by category

 

Financial assets

 

 

 

 

Loans and receivables

 

 

 

 

 

 

2015

2014

 

 

 

 

 

 

£'000

£'000

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

 

 

 

7,388

-

 

Trade and other receivables

 

 

 

 

3,433

5,830

 

 

 

 

 

 

_______

_______

 

Total financial assets at amortised cost

 

 

 

 

 

10,821

 

5,830

 

 

 

 

 

 

_______

_______

               

The investment in available for sale investments is included with the available for sale financial asset category and has a fair value of £1 at 31 August 2015 (2014: £1).

 

 

Financial liabilities

 

 

 

 

 

 

 

 

 

Financial liabilities at amortised cost

 

 

 

 

2015

2014

 

 

 

 

£'000

£'000

 

 

 

 

 

 

 

Trade and other payables

 

 

5,704

1,242

 

Loans and borrowings

 

 

9,083

-

 

 

 

 

_______

_______

 

 

 

 

 

 

 

Total financial liabilities

 

 

14,787

1,242

 

 

 

 

_______

_______

  

Stride Gaming Plc

 

Notes forming part of the financial statements

For the year ended 31 August 2015 (continued)

 

 

21

Financial instruments - Risk Management (continued)

 

 Principal financial instruments (continued)

 

Financial instruments not measured at fair value

 

The carrying value of cash and cash equivalents, trade and other receivables, trade and other payables and loans and borrowings approximates their fair value.

 

Financial instruments measured at fair value

 

Other than the available for sale investment which is within level 3 of the financial reporting hierarchy and for which there has been no movement in fair value in the year, no other financial assets or liabilities are held at fair value.

 

General objectives, policies and processes

 

The Board has overall responsibility for the determination of the Group's risk management objectives and policies and, whilst retaining ultimate responsibility for them, it has delegated the authority for designing and operating processes that ensure the effective implementation of the objectives and policies to the Group's finance function.  The overall objective of the Board is to set policies that seek to reduce risk as far as possible without unduly affecting the Group's competitiveness and flexibility.  Further details regarding these policies are set out below:

 

Credit risk

 

Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations. The Group's operational credit risk is primarily attributable to receivables from payment solution providers ("PSPs") and from customers who dispute their deposits made after playing on the Group's websites. Senior management monitors PSP balances on a weekly basis, including aged debtor analysis, and promptly takes corrective action if pre-agreed limits are exceeded.

 

Credit risk also arises from cash and cash equivalents and deposits with banks and financial institutions.  For banks and financial institutions, only independently rated parties with high ratings are accepted.

 

Further disclosures regarding trade and other receivables, which are neither past due nor impaired, are provided in note 14.

 

 

 

Stride Gaming Plc

 

Notes forming part of the financial statements

For the year ended 31 August 2015 (continued)

 

 

21

Financial instruments - Risk Management (continued)

 

Foreign exchange risk

 

The Group is exposed to translation and transaction foreign exchange risk.  The Group's policy in this case is to allow the subsidiary to settle liabilities denominated in their functional currency with the cash generated from their own operations in that currency.  The majority of the remainder of the Group's transactions are denominated in GBP Sterling, therefore the directors deem the Group's exposure to all other exchange rate fluctuations to be minimal.

 

Foreign currency denominated financial assets and liabilities, translated into GBP Sterling at the closing rate, are as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

                                              As at 31 August 2015

 

 

 

 

 

 

 

 

Sterling

 

 

US dollar

 

Israeli Shekel

 

 

Other

 

 

Total

 

 

 

 

 

£'000

£'000

£'000

£'000

£'000

 

 

 

 

 

 

 

 

 

 

 

 

Financial assets

 

 

8,594

581

1,337

309

10,821

 

 

Financial liabilities

 

 

(12,369)

(828)

(1,259)

(331)

(14,787)

 

 

 

 

 

_______

_______

_______

_______

_______

 

 

 

 

 

 

 

 

 

 

 

 

Total net exposure

 

 

(3,775)

(247)

78

(22)

(3,966)

 

 

 

 

 

_______

_______

_______

_______

_______

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

                                               As at 31 August 2014

 

 

 

 

 

 

 

 

Sterling

 

 

US dollar

 

Israeli Shekel

 

 

Other

 

 

Total

 

 

 

 

 

£'000

£'000

£'000

£'000

£'000

 

 

 

 

 

 

 

 

 

 

 

 

Financial assets

 

 

5,732

-

-

98

5,830

 

 

Financial liabilities

 

 

(1,214)

(2)

-

(26)

(1,242)

 

 

 

 

 

_______

_______

_______

_______

_______

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total net exposure

 

4,518

(2)

-

72

4,588

 

 

 

 

 

_______

_______

_______

_______

_______

 

                               
 

Stride Gaming Plc

 

Notes forming part of the financial statements

For the year ended 31 August 2015 (continued)

 

 

21

Financial instruments - Risk Management (continued)

 

Liquidity risk

 

Liquidity risk arises from the Group's management of working capital and the finance charges and principal repayments on its short term borrowings.  It is the risk that the Group will encounter difficulty in meeting its financial obligations as they fall due.

 

The Group's policy is to ensure that it will always have sufficient cash to allow it to meet its liabilities when they become due and as at the end of the financial year, projections indicate that the Group expects to have sufficient liquid resources to meet its obligations under all reasonably expected circumstances.

 

The following table sets out the contractual maturities (representing undiscounted contractual cash-flows) of financial liabilities:

 

 

 

Between

Between

Between

 

 

 

Up to 3

3 and 12

1 and 2

2 and 5

 

 

 

months

months

years

years

 

 

At 31 August 2015

£'000

£'000

£'000

£'000

 

 

 

 

 

 

 

 

 

Trade and other payables

3,982

1,450

172

100

 

 

Loans and borrowings

1,083

-

9,150

-

 

 

 

_______

_______

_______

_______

 

 

 

 

 

 

 

 

 

Total

5,065

1,450

9,322

100

 

 

 

_______

_______

_______

_______

 

 

 

 

 

 

 

 

 

 

 

Between

Between

Between

 

 

 

Up to 3

3 and 12

1 and 2

2 and 5

 

 

 

Months

months

years

Years

 

 

At 31 August 2014

£'000

£'000

£'000

£'000

 

 

 

 

 

 

 

 

 

Trade and other payables

1,242

-

-

-

 

 

 

 

 

 

 

 

 

 

_______

_______

_______

_______

 

 

 

 

 

 

 

 

 

Total

1,242

-

-

-

 

 

 

_______

_______

_______

_______

 

 

 

22

Share-based payment

 

The Company established an equity-settled share option scheme in the year for employees and non-employees, which includes the following:

 

i)             Enterprise Management Incentive share options ("EMI Options") which qualify for favourable tax treatment under the provisions of Schedule 5 to ITEPA. Holders of EMI options have up to 10 years from the date of grant to exercise these options. The number of options and vesting dates are in accordance with each individual agreement.

  

 

Stride Gaming Plc

 

Notes forming part of the financial statements

For the year ended 31 August 2015 (continued)

 

 

 

22

Share-based payment (continued)

 

ii)            Non-Qualifying options made available to employees and executive directors of the Group also have up to 10 years from the date of grant to exercise the options. The exact numbers and vesting dates will be depend on each contract agreement, but all options will vest and will therefore be exercisable in no more than three years from the date of grant.

iii)           Non-employee options are available to non-executives and individuals providing services to the company, which are non-employees. The vesting and exercise conditions are the same as non-qualifying options.

 

 

 

 

 

 

 

 

 

 

 

 

Weighted

 

 

 

 

 

average

 

 

 

 

 

exercise

 

 

 

 

 

price (p)

Number

 

 

 

 

 

 

 

Outstanding at 1 September

 

 

-

-

 

Granted during the year

 

 

1.32

3,000,000

 

 

 

 

 

_______

 

 

 

 

 

 

 

Outstanding at 31 August

 

 

 

3,000,000

 

 

 

 

 

 

 

_______

The exercise price of options outstanding at 31 August 2015 was £1.32 with a contractual life of 3 years.  None of the options granted during the year vested on 31 August 2015, as they vest annually at each anniversary of the grant, by one third each year.  The fair value of each option granted during the year was £0.50. Included in the outstanding number of options above are 1,000,000 options issued to non-employees under the appropriate terms of the Share Option Scheme.

 

The following information is relevant in the determination of the fair value of options granted during the year under the equity-settled share based remuneration schemes operated by the Group.

 

 

 

 

 

2015

 

Option pricing model used

 

Black Scholes

 

Weighted average share price at grant date (£)

 

1.32

 

Exercise price (£)

 

1.32

 

Weighted average contractual life (in years)

 

3

 

Expected volatility

 

55.77%

 

Expected dividend growth rate

 

0.5%

 

Risk-free interest rate

 

1.73%

 

The volatility assumption, measured at the standard deviation of expected share price returns, is based on a statistical analysis of daily share prices of comparable companies over the last three years.  None of the options are exercisable at 31 August 2015.

 

The share-based remuneration expense comprises:

 

 

 

 

2015

 

 

 

£'000

 

 

 

 

 

Equity-settled schemes, including national insurance

 

306

 

 

 

_______

 

 

 

Stride Gaming Plc

 

Notes forming part of the financial statements

For the year ended 31 August 2015 (continued)

 

 

23    Business Combination during the period

 

Acquisition of Table Top Entertainment ("TTE")

 

On 4 September 2014, Daub Alderney Limited acquired the trade and assets of TTE, a company incorporated in Alderney and whose principal activity is the operation of online casino and bingo gaming sites. The total consideration was £12,500,000 comprising £3,430,000 of initial consideration settled through the issue of 670,760 shares of £0.0001 each, and further contingent consideration based on certain targets on first and second anniversary dates to a maximum of £9,070,000, also to be settled in shares.

 

The principal reason for this acquisition was to enhance the Group's brands and revenue volumes, by acquiring established and leading brands with strong player bases. The Group also intends to use the expertise and the know-how acquired in the development of new product lines and operational efficiency. Details of the fair value of identifiable assets and liabilities acquired, purchase consideration and goodwill are as follows:

 

 

 

Book

 

Fair

 

 

value

Adjustment

value

 

 

£'000

£'000

£'000

 

 

 

 

 

 

Client liabilities

(145)

-

(145)

 

Progressive prize pool

(784)

-

(784)

 

Other payables

(142)

-

(142)

 

Cash

929

-

929

 

Property, plant and equipment

66

-

66

 

Brands

-

1,171

1,171

 

Customer relationships

-

5,521

5,521

 

 

_______

_______

_______

 

 

 

 

 

 

Total net assets

(76)

6,692

6,616

 

 

_______

_______

 

 

  Fair value of consideration paid

 

 

Initial consideration

3,430

 

Discount on initial consideration

(519)

 

Fair value of contingent consideration

7,713

 

 

_______

 

 

 

 

Total consideration

10,624

 

 

_______

 

 

 

 

Goodwill (note 12)

4,008

 

 

_______

 

The Goodwill recognised on the acquisition of the business and assets of TTE, which is not deductible for tax purposes, relates to the presence of certain intangible assets, such as knowhow and other operating synergies.

 

Discount on initial consideration - under the terms of the business purchase agreement, the Group is entitled to the net profits derived from the acquired business from 31 July 2014 until 4 September 2014 (legal completion date) which has been returned by way of cash proceeds. This amounted to £519,000 and has been deducted from the initial consideration. Acquisition related costs have been borne by a related party and are immaterial.

 

 

Stride Gaming Plc

 

Notes forming part of the financial statements

For the year ended 31 August 2015 (continued)

 

 

23

Business combinations during the period (continued)

 

The contingent consideration which is to be settled in shares was initially recorded as a liability based on the fair value at acquisition and was being unwound over the respective earn-out periods to the first and second anniversaries. However, on 18 May 2015 the terms of the existing earn-out were terminated and new arrangements were entered into such that, with effect from completion of the IPO, the earn-out, and hence liability would be met by certain shareholders as opposed to shares being issued by the Company. The liability at the date of the variation, which included unwinding of the discount to the date of the variation of £742,000, totalled £8,455,000 and was transferred to a capital contribution reserve.

 

Given the acquisition occurred on 4 September 2014 there is no material difference in the results between the start of the year and date of acquisition.

 

Acquisition of Spacebar Media Limited

 

On 1 February 2015, the Group acquired 100 per cent. of the voting equity instruments of Spacebar Media Limited. Spacebar Media Limited is a UK company whose principal activities are execution and management of marketing services together with development and maintenance of online gaming software. 

 

The principal reason for this acquisition was to leverage the knowledge and experience of Spacebar Media Limited, developed over a number of years in the software development arena and the marketing consultancy of online gaming brands, for the exclusive use of the Group.

 

Details of the fair value of identifiable assets and liabilities acquired, purchase consideration and goodwill are as follows:                                                                                                                                                                                  

 

 

 

Book

 

Fair

 

 

value

Adjustment

value

 

 

£'000

£'000

£'000

 

 

 

 

 

 

Property, plant and equipment

65

-

65

 

Trade and other receivables

336

-

336

 

Cash

26

-

26

 

Trade and other payables

(363)

-

(363)

 

 

_______

_______

_______

 

 

 

 

 

 

Total net liabilities

64

-

64

 

 

_______

_______

 

 

 

 

Cash

6,000

 

 

_______

 

 

 

 

Goodwill (note 12)

5,936

 

 

_______

 

Stride Gaming Plc

 

Notes forming part of the financial statements

For the year ended 31 August 2015 (continued)

 

 

23

Business combinations during the period (continued)

 

Acquisition of Spacebar Media Limited (continued)

 

The goodwill recognised in the acquisition of Spacebar Media Limited, which is not deductible for tax purposes, includes certain intangible assets such as, expertise and know-how, which do not qualify for separate recognition. Acquisition related costs have been borne by a related party and are not material.

 

Between the date of acquisition and 31 August 2015 Spacebar Media Limited contributed £nil to group revenues on the basis that all post-acquisition revenue was inter-group.

 

Acquisition of InfiApps Ltd

 

On 31 July 2015, the group acquired 100% of the voting equity instruments of InfiApps Ltd ("InfiApps"), a company registered in Israel whose principal activity is the provision of internationally-focused mobile social gaming services. The acquisition will provide the Group with an entry into the social gaming sector of online gaming, with users based internationally, in particular in the United States of America, Canada and Australia. By expanding into new verticals alongside the online bingo market the acquisition will combine the Group's bingo-led expertise with InfiApps' social gaming expertise, both of which are complementary offerings to each other, which provide potential for significant operational leverage on an international scale.

 

Details of the provisional fair value of identifiable assets and liabilities acquired, purchase consideration and goodwill are as follows:

 

 

Book

 

Fair

 

 

value

Adjustment

 value

 

 

£'000

£'000

£'000

 

 

 

 

 

 

Property, plant and equipment

67

-

67

 

Cash

585

-

585

 

Trade and other receivables

1,105

-

1,105

 

Deferred tax asset

120

-

120

 

Trade and other payables

(702)

-

(702)

 

Loans and borrowings

(848)

-

(848)

 

Brands

-

1,094

1,094

 

Developed software

-

7,778

7,778

 

Customer and contractual relationships

-

2,404

2,404

 

Deferred tax liability

-

(2,148)

(2,148)

 

 

 

 

 

 

 

_______

_______

_______

 

Total net assets

 

 

 

 

 

327

9,128

9,455

 

 

_______

_______

 

 

 

 

 

 

 

Fair value of consideration paid

 

 

Cash

14,120

 

Working capital payable in cash

257

 

 

_______

 

 

 

 

Total consideration

14,377

 

 

_______

 

 

 

 

Goodwill (note 12)

4,922

 

 

_______

 

 

Stride Gaming Plc

 

Notes forming part of the financial statements

For the year ended 31 August 2015 (continued)

 

 

23

Business combinations during the period (continued)

 

Acquisition of InfiApps Ltd (continued)

 

The purchase agreement also included a two year earn-out payable to the sellers as contingent consideration if they remain with the acquired company for a two year period post-acquisition. It has been accounted for as remuneration rather than part of the consideration paid to acquire InfiApps in accordance with international accounting standards. The Group has recognised £217,000 in the income statement, being the present value of the earn-out consideration having made a probability based assessment of the amount payable, which represents the fair value at acquisition date. The earn-out consideration has been calculated based on the Group's expectation of what it will pay in relation to the earn out agreement. The earn out targets are based on the EBITDA multiple of the annual results of the acquired business. The fair value of the earn-out consideration is calculated by weighting the probability of achieving these targets and discounting to give an estimate of the final obligation. In accordance with the terms of the purchase agreement the total earn-out cannot exceed $18m.

 

Total acquisition costs amounted to £1.89m and these have been recognised in the profit or loss account.

 

The main factors leading to the recognition of goodwill which is not deductible for tax purposes was the presence of certain intangible assets, such as the assembled workforce of the acquired entity, as well as synergies gained, which do not qualify for separate recognition.

 

InfiApps contributed £1,116,000 to group revenues and £234,000 to group profit between the date of acquisition and 31 August 2015. 

 

          Acquisition of Baldo Line SRL

 

On 16 January 2015, the ultimate controlling party prior to the IPO, contributed its 100 per cent. investment in the equity share capital of Baldo Line SRL by way of a capital contribution to the Group. Baldo Line S.R.L. is a company incorporated under the laws of Italy and holds an online gambling licence from the Italian gambling commission (AAMS). The contribution is outside of the scope of IFRS 3 Business Combinations on the basis that this is a common control transaction. The asset and liabilities have therefore been transferred at book value and capital contribution of £318,000 based on net asset value has been recorded:

 

 

Book value

 

on date of capital contribution

 

£'000

 

 

      Intangible assets

331

      Other receivables

165

      Trade and other payables

(178)

 

 

 

_______

     Total net assets

 

 

318

 

_______

 

 

 

Stride Gaming Plc

 

Notes forming part of the financial statements

For the year ended 31 August 2015 (continued)

 

 

 

24

Related party transactions

 

The Group receives payment processing services from a company related by common significant shareholders.   Fees charged during the year totalled £662,000 (2014: £490,000). In addition to providing processing services the company previously held cash on behalf of the Group and the total amount due to the Group at 31 August 2014 was £2,380,000.   During the year this amount was novated to the ultimate controlling party prior to the IPO to clear a dividend amount due. The amount due to the Group at 31 August 2015 is £1,211,000. No impairment has been recognised in respect of this amount.

 

The ultimate controlling party prior to the IPO also held cash on behalf of the Group and, at 31 August 2014 the amount due was £3,041,000. No provision has been recognised in respect of this amounts and no amounts were written-off during the period. This balance was cleared by way of a dividend prior to the IPO. In addition, the following transactions were undertaken with the ultimate controlling party:

 

·      Contribution of its 100 per cent. investment in the equity share capital of Baldo Line SRL by way of a capital contribution to the Group. The asset and liabilities have therefore been transferred at book value and a capital contribution of £318,000 based on net asset value has been recorded. A total of £170,000 was due to the ultimate controlling party at 31 August 2015;

·      Acquisition of the  IP rights of its designated software used in the business of Daub Alderney Limited  for £875,000;

·      Contribution of a 24.5 per cent. investment in the equity share capital of QSB Gaming Limited, which was recognised at fair value of £1 and accounted for as an available-for-sale investment; and

·      On 1 February 2015 the Group acquired 100% of the voting equity instruments of Spacebar Media Ltd (refer to Note 23). The total consideration of £6,000,000 was contributed to the Group in cash by the ultimate controlling party by way of a capital contribution to enable the acquisition to be made.

  

The Group entered into related party transactions with certain other companies under control of shareholders for the provision of software platform, marketing and other back office services. The total purchases in the year ended 31 August 2015 were £1,538,000 (2014:  £715,000). Total amount due by the Group at 31 August 2015 is £62,000 (2014: £86,000).

 

The Group received execution and management of marketing and software development services from Spacebar Media Limited (which was subsequently acquired by the Group on 1 February 2015 for £6,000,000 - see note 23) a company related by common control. Purchases of services in the period prior to acquisition were £1,000,000 (2014: £482,000).

 

On 1 February 2015 the Group acquired certain assets from a company related by common control for £46,000.  

 

On 30 July 2015 the Group entered into a loan agreement with a shareholder for a total amount of £8,000,000. The amount is repayable in 24 months and is incurring interest of 7.5% per annum paid monthly in arrears. The full amount of £8,000,000 plus one month's of accrued interest at £51,000 was outstanding at 31 August 2015.

 

As at 31 August 2015 a total of £1,083,000 of short term, interest free borrowings are due to the previous owners of the InfiApps Ltd business. These will be repaid in accordance with the terms of the sale and purchase agreement within two months from the year end.  These borrowings are unsecured.

 

 

Stride Gaming Plc

 

Notes forming part of the financial statements

For the year ended 31 August 2015 (continued)

 

 

 

25

Events after the reporting date

 

Post year end on the first anniversary of the acquisition of software and related programs from NextTec Software Inc (refer to Note 12), the first part of the contingent consideration was repaid by the issue of 1,149,071 shares.

 

In October 2015, a total of 1,113,000 of non-qualifying options and 564,000 non-employee options were granted to various employees and consultants of the Group. The general terms and conditions include an exercise price of £1.32 per share, with one third vesting at the end of the second anniversary of the grant, and the balance vesting on the third and fourth anniversaries.

 

26

Non-cash movements in cash flow statement

 

The following transactions were significant non-cash movements during the year:

 

·      From the total dividends declared during the year, £3,000,000 was paid in cash, with the balance offset against a related party receivable;

·      Included within software and licenses additions is the acquisition of the IP rights of the software used in the business of Daub Alderney Limited acquired from the ultimate shareholder for £875,000. This was offset against a related party receivable and not paid in cash; and

·      Included within software and licenses additions is the acquired software and related programs valued at £4,132,000, from NextTec Software Inc in respect of the underlying gaming platform and software used by Table Top Entertainment which will be settled by contingently issuable shares.

 

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
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