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First Sentinel Plc - Interim Results

·13-min read

This announcement contains inside information for the purposes of the Market Abuse Regulation (EU No. 596/2014) (“MAR”). Upon the publication of this announcement, this inside information is now considered to be in the public domain and shall therefore cease to be inside information.

First Sentinel Plc - Interim Results


30 September 2020

First Sentinel Plc
(“First Sentinel” or the “Company”)

Interim results for the period ended 30 June 2020

First Sentinel is pleased to announce its interim accounts for the six months ended 30 June 2020 (the “Interim Accounts”). Extracts of the Interim Accounts are set out at https://first-sentinel.com.

The Chairman's Report

I present the results for First Sentinel plc for the six months ended 30 June 2020. These have been challenging times but, despite the outbreak of the Covid-19 pandemic in the first months of 2020, I am delighted to report that First Sentinel has been able to mobilise its staff to work from home with very little disruption to our business. Since the effects of the pandemic took hold, we have adapted our strategy in order to focus on resilient industries.

Between January and June 2020, First Sentinel raised £1,734,426 and deployed the proceeds on a number of loan facilities and on its UK supply chain finance business via its subsidiary, Capable Finance Limited. First Sentinel’s Australian subsidiary, Perennial Enterprise PTY Ltd, continues to progress well and its robust capital deployment strategy has kept its financial results immune from the effects of the pandemic. In addition, the Company has made equity investments (Stabilitech, now renamed iosBio, and Vulcan Industries) which have contributed to increasing value to our shareholders.

Our strategy during the first 6 months of 2020 has proved successful and I am pleased to report a profit of 1.12p per share (YE 2019: loss of 4.24p per share). In the next 6 months, we intend to enhance the Group’s focus on our UK invoice purchasing and supply chain finance activities whilst taking advantage of equity investment opportunities that are aligned with our risk profile and investment strategy.

Outlook

The six months to 30 June 2020 have continued to be a very successful period for First Sentinel. The success of the fund raising, investments made and the establishment of supply chain finance operations in the UK has positioned the Group very well for the next stage of its development. Our short-term strategy remains at increasing value by providing growth capital for public and private company investments and, in particular, by significantly growing the invoice purchasing activities in Australia and the supply chain finance operations in the UK. I am very optimistic about the Group’s growth potential and we look to the future with significant confidence.

About First Sentinel plc

First Sentinel PLC provides debt financing solutions for small to medium-sized businesses primarily through its supply chain finance and invoice purchasing activities. First Sentinel also invests in a range of secured and unsecured equity and debt instruments in private and public companies.

The Company’s website is https://first-sentinel.com

For further corporate information, please contact:

Mr. Brian Stockbridge
CEO
First Sentinel Plc
Tel: + 44 (0) 7876 888 011

AQSE Corporate Advisor
Beaumont Cornish Limited
James Biddle / Roland Cornish
Tel: +44(0)20 7628 3396

-END-



Interim Condensed Statement of Comprehensive Income




Notes

6 months Ended
30 June
2020
Unaudited

6 months Ended
30 June
2019
Unaudited

Year ended 31 December 2019
Audited

£’000

£’000

£’000

Revenue

1,199

710

1,440

Cost of sales

-

(185)

(89)

Gross profit

1,199

525

1,351

Administrative expenses

4

(678)

(591)

(1,534)

Other Income

-

21

33

Operating profit / (loss)

521

(45)

(150)

Finance Costs

(249)

(326)

(587)

Finance Income

-

257

33

Profit / (loss) on ordinary activities before taxation

272

(114)

(704)

Tax on loss on ordinary activities

-

(24)

(63)

Profit / (loss) after taxation

272

(137)

(767)

Other comprehensive income

-

-

-

Total comprehensive profit / (loss) for the period

272

(137)

(767)

Profit / (loss) and total comprehensive attributable

the owners of the company

205

(137)

(855)

Non-controlling interests

67

-

88

272

(137)

(767)

Basic and diluted Profit / (loss) per share (expressed in pence per share)

5

1.12p

(0.90p)

(4.24p)



Interim Condensed Statement of Changes in Equity

Share Capital

Share Premium

Accumulated Deficit

Preference Share Equity Component

Share Based Payment
Reserve

Non-Controlling interest

Foreign Exchange Reserve

Total Equity

£’000

£’000

£’000

£’000

£’000

£’000

£’000

£’000

Balance at 30 June 2019

152

1,449

(1,092)

-

26

154

(113)

576

Issue of shares

61

648

-

-

-

-

-

709

Share based payments charge

-

-

-

-

105

-

-

105

Non-controlling interest

-

-

-

-

-

92

-

92

Foreign Exchange Difference

-

-

-

-

-

-

(134)

(134)

Loss and total comprehensive loss for the period

-

-

(717)

-

-

-

-

(717)

Balance at 31 December 2019

213

2,097

(1,809)

-

131

245

(245)

632

Issue of shares

50

1,021

-

41

-

-

-

1,112

Non-Controlling Interest

-

-

-

-

-

(229)

-

(229)

Share based payments charge

-

-

-

-

84

-

-

84

Foreign Exchange Difference

-

-

104

-

-

-

196

300

Loss and total comprehensive loss for the period

-

-

205

-

-

67

-

272

Balance at 30 June 2020

263

3,118

(1,500)

41

215

83

49

2,171

Share capital is the amount subscribed for shares at nominal value.
Share premium is the amount subscribed for shares in excess of nominal value.
Accumulated deficit represents the cumulative loss of the Group attributable to equity shareholders.



Interim Condensed Statement of the Financial Position


Notes

6 months Ended
30 June
2020
Unaudited

6 months Ended
30 June
2019
Unaudited

Year ended 31 December 2019
Audited

£’000

£’000

£’000

Assets

Non-Current Assets

Intangible Assets

51

51

48

Goodwill

88

88

88

Property, Plant & equipment

189

79

54

Right of use Asset

198

-

131

Total non-Current Assets

526

218

321

Current assets

Trade Receivables

6,136

5,112

5,730

Other Receivables

-

9

-

Other financial assets

6

2,072

662

242

Cash and Cash Equivalents

741

1,790

1,255

Total Current Assets

8,950

7,573

7,228

Total Assets

9,476

7,791

7,549

Equity and Liabilities

Share Capital

7

263

152

213

Share Premium

7

3,118

1,449

2,097

Preference share equity component

41

-

-

Share based payment reserve

215

26

131

Non-controlling interest

83

154

245

Foreign Exchange reserve

(49)

(113)

(245)

Accumulated deficit

(1,500)

(1,092)

(1,809)

Total Equity

2,171

576

632

Current Liabilities

Trade Payables

205

1,383

114

Short term lease liabilities

202

-

31

Borrowings

1,840

-

1,944

Other Payables

14

145

170

Total Current Liabilities

2,261

1,528

2,259

Non-current Liabilities

Borrowings

5,044

5,687

4,530

Other Payables

-

-

128

Total non-current Liabilities

5,044

5,687

4,658

Total Liabilities

7,305

7,215

6,917

Total Equity and Liabilities

9,476

7,791

7,549



Interim Condensed Cash Flow Statement




Notes

6 months Ended
30 June
2020
Unaudited

6 Months Ended
30 June 2019
Unaudited

Year ended
31 December 2019
Audited

£’000

£’000

£’000

Cash flows from operating activities

Operating profit/(loss)

521

(45)

(150)

Changes in working capital

(Increase) / decrease in receivables

(406)

(843)

(1,514)

Increase / (decrease) in payables

(2)

1,142

(143)

Other adjustments

-

(172)

-

Depreciation

22

-

113

Fair value adjustments

(431)

-

156

Share based payment

84

-

105

Interest Received

-

(257)

33

Interest elements of lease payments

-

-

(10)

Interest Paid

(249)

-

(577)

Net cash flow from operating activities

(461)

(175)

(1,987)

Investing Activities

Acquisition of subsidiary

6

-

-

(50)

Net Proceeds from transactions of financial assets at fair value through profit or loss

(1,399)

150

239

Purchases of property, plant and equipment

(135)

-

(41)

Net cash flow from investing activities

(1,534)

150

148

Cash flows from financing activities:

Net proceeds from issue of shares

7

1,071

-

709

Net Proceeds from issue of financial liabilities at amortised cost – loans

(104)

-

10

Net Proceeds from issue of financial liabilities at amortised cost – bonds

514

965

1,742

Principal elements of lease payments

-

-

(97)

Net cash flow from financing activities

1,481

965

2,364

Taxation

-

24

(96)

Net cash flow for the period

(514)

964

429

Opening Cash and cash equivalents

1,255

826

826

Closing Cash and cash equivalents

741

1,790

1,255



Notes to the Interim Condensed Financial Statements

1. General Information

First Sentinel plc (‘the Company’) is a trading company incorporated in the United Kingdom with company number 10183367 and quoted on the AQSE Exchange Growth Market.

2. Basis of Preparation

The annual financial statements of the Company and its subsidiaries (together referred to as the “Group”) are prepared in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union. The condensed set of financial statements included in this interim financial report has been prepared in accordance with IAS 34 ‘Interim Financial Reporting’, as adopted by the European Union. The accounting policies and methods of computation used are consistent with those used in the Group’s latest audited financial statements for the year ended 31 December 2019.

A copy of the statutory accounts for the year ended 31 December 2019 has been delivered to the Registrar of Companies. The auditor’s report on these accounts was unqualified, did not draw attention to any matters by way of emphasis and did not contain a statement under section 498(2) or (3) of the Companies Act 2006.

3. Segmental Reporting

The Group’s management has determined the operating segments based on the reports reviewed by the executive directors that are used to make strategic decisions. They consider the business from a geographical perspective and the group has two reportable segments, the UK and Australia. The Group’s main lines of business are that of making investments and invoice purchasing.

For the period ended 30 June 2020:

UK

Australia

Total

£’000

£’000

£’000

Segment revenue and results

Reportable revenue

688

511

1,199

Revenue from external customers

688

511

799

Cost of Sales

-

-

-

Unallocated corporate income and expenses

(218)

(438)

(656)

Depreciation

(22)

-

(22)

Interest expense

(5)

(244)

(249)

Interest Income

-

-

-

Tax expense

-

-

-

Intersegment revenues/costs

(186)

186

-

Profit/(Loss)

257

15

272

Segment assets and liabilities

Reportable segment assets

7,624

5,974

13,598

Intersegment eliminations

(4,210)

-

(4,210)

Goodwill

88

Consolidated total assets

9,476

Reportable segment liabilities

5,395

5,485

10,880

Intersegment eliminations

-

(3,575)

(3,575)

Consolidated total liabilities

7,305

For the period ended 31 December 2019:

UK

Australia

Total

£’000

£’000

£’000

Segment revenue and results

Reportable revenue

(104)

1,544

1,440

Revenue from external customers

(104)

1,544

1,440

Cost of Sales

-

(89)

(89)

Other income

-

33

33

Unallocated corporate income and expenses

(932)

(490)

(1,422)

Depreciation and amortisation

(66)

(47)

(113)

Interest expense

(350)

(236)

(586)

Interest Income

32

1

33

Tax expense

-

(63)

(63)

Intersegment revenues/costs

464

(464)

-

Loss

(956)

189

(767)

Segment assets and liabilities

Reportable segment assets

5,547

6,039

11,586

Intersegment eliminations

(4,125)

-

(4,125)

Goodwill

88

Consolidated total assets

7,549

Reportable segment liabilities

5,069

5,583

10,652

Intersegment eliminations

-

(3,735)

(3,735)

Consolidated total liabilities

6,917

For the period ended 30 June 2019:

UK

Australia

Total

£’000

£’000

£’000

Segment revenue and results

Reportable revenue

32

678

710

Revenue from external customers

32

678

710

Cost of Sales

-

-

-

Unallocated corporate income and expenses

(321)

(259)

(580)

Tax expense

-

(24)

(24)

Loss

105

Segment assets and liabilities

Reportable segment assets

4,497

3,122

7,617

Goodwill

92

92

Consolidated total assets

7,710

Reportable segment liabilities

4,174

2,996

7,170

Consolidated total liabilities

7,170

Other segment information

Interest expense

(152)

(359)

(511)

Interest income

251

7

257

Depreciation

-

-

-

4. Group Result for the period

The current period operating loss incorporated the following main items:

6 months Ended
30 June
2020
Unaudited

6 Months Ended 30 June 2019
Unaudited

Year ended 31 December 2019
Audited

£’000

£’000

£’000

Directors’ remuneration and fees

53

152

477

Legal and professional fees

26

49

136

Other expenses

599

390

921

678

591

1,534

5. Profit / Loss per Share

Profit / Loss per share data is based on the Group result for the six months and the weighted average number of shares in issue.

Basic loss per share is calculated by dividing the loss attributable to equity shareholders by the weighted average number of ordinary shares in issue during the period:

6 months Ended
30 June
2020
Unaudited

6 Months Ended 30 June 2019
Unaudited

Year ended 31 December 2019
Audited

£

£

£

Profit/(loss) after tax

272,000

(137,000)

(767,000)

Weighted average number of ordinary shares in issue

24,224,324

15,228,089

18,073,929

Basic and diluted Profit/(loss) per share (pence)

1.12p

(0.90p)

(4.24p)

Basic and diluted earnings per share are the same, since where a loss is incurred the effect of outstanding share options and warrants is considered anti-dilutive and is ignored for the purpose of the loss per share calculation. There were 26,324,316 potential dilutive shares in issue during the period for share options and warrants.

6. Financial assets

During the period the Group had the following movements in investments:

30 June
2020
Unaudited

At 30 June 2019
Unaudited


Year ended 31 December 2019
Audited

£’000

£’000

£’000

Secured loan notes

-

222

-

Financial assets through profit and loss

2,072

440

242

Total financial assets

2,072

662

242

7. Share Capital

Ordinary shares are classified as equity. Proceeds from issuance of ordinary shares are classified as equity. Incremental costs directly attributable to the issuance of new ordinary shares are deducted against share capital.

Allotted, called up and fully paid ordinary shares of 0.01p each

Number of shares

Share
Capital

Share Premium

£

£

Balance at 17 May 2016

100

1

-

Balance at 30 June 2016

100

1

-

Share issue at £0.10 – 15 March 2017

6,309,794

63,098

511,233

Share issue at £0.10 – 24 March 2017

50,000

500

4,500

Share issue at £0.10 – 18 April 2017

727,273

7,273

72,727

Balance at 30 June 2019

15,246,770

152,467

1,448,340

Share issue at £0.14 – 05 August 2019

421,429

4,214

54,786

Share issue at £0.15 – 23 September 2019

1,666,667

16,667

233,333

Share issue at £0.10 – 25 October 2019

4,000,000

40,000

360,000

Balance at 31 December 2019

21,334,866

213,349

2,097,119

Share issue at £0.010 – 24 January 2020

815,462

8,155

212,020

Share issue at £0.010 – 11 March 2020

914,535

9,145

173,762

Share issue at £0.010 – 19 March 2020

1,944,810

19,448

369,514

Share issue at £0.010 – 23 April 2020

757,500

7,575

143,925

Share issue at £0.010 – 04 June 2020

557,143

5,571

111,428

Balance at 30 June 2020

26,324,316

263,243

3,107,768

8. Events Subsequent to 30 June 2020

After the period end the Company has raised £200,000 from the initial tranches of Green Finance Preference Shares issued.

On the 28 August 2020 the company raised £179,077 by issuing 179,077 bonds

-END-