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Startup Giants Plc - Results for Year Ended 31st Dec. 2020

·10-min read

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF REGULATION (EU) NO. 596/2014 OF THE EUROPEAN PARLIAMENT AND THE COUNCIL OF 16 APRIL 2014 ON MARKET ABUSE AS IT FORMS PART OF RETAINED EU LAW AS DEFINED IN THE EUROPEAN UNION (WITHDRAWAL) ACT 2018 (THE "MARKET ABUSE REGULATION"). UPON PUBLICATION OF THIS ANNOUNCEMENT, THE INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN.

Startup Giants PLC

(“Startup Giants” or the “Company”; AQSE: SUG)

Directors’ Strategic Review; Results for the Year Ended 31st December 2020

The Directors of Startup Giants present below the Company’s audited financial statements for the year ended 31st December 2020. Shareholders should understand that the financial statements below are extracted from - but do not on their own constitute - Startup Giants’ statutory accounts. These are contained in the Annual Report and Financial Statements for the Year Ended 31 December 2020, which are expected to be posted to shareholders on or prior to 5th June 2021 and to be laid before shareholders for adoption and approval at the Annual General Meeting (“AGM”; please see below). For a fuller and more detailed explanation of the financial statements below, shareholders are therefore referred to the statutory accounts, including with the full Notes thereto. A downloadable copy of the Annual Report and Financial Statements will be obtainable from the Company’s website at https://startupgiants.com.

Financial Results

Owing to an increase in the Company’s business activities described below in identifying and supporting young businesses to locate and establish themselves in the United Kingdom, the Board is pleased to note that the Company’s revenues rose significantly from the previous year’s level. The Company undertook consultancy work for and provided support services to early-stage entrepreneurs, generating revenue of £87,461* (2019, £45,256). A sharp rise in administrative costs to £(234,477) (2019, £(130,807)), which was largely composed of costs associated with gearing-up the support able to be provided to endorsee entrepreneurs, resulted in an operating loss of £(147,016) (2019, £(85,551)). The operating loss coupled, with a one-off investment impairment charge of £40,000 and a small financing charge, resulted in an overall loss of £(188,099) (2019, £(85,551)) translating into a loss per share of (18.62) pence (2019, loss per share of (8.47) pence). At the end of the year, shareholders’ funds stood at £446,627 (2019, £634,726); cash and cash-equivalents in hand stood at £675,958 (2019, £641,989) being an increase of £33,969.

* The accounting policy applied in Startup Giants’ financial statements to the recognition of income is that certain deposits or pre-payments received by the Company during the year to 31st December 2020 are included in the reported revenue of £87,461 only to the extent that the services to which such deposits or pre-payments relate were delivered prior to the end of the financial year. The balance of such deposits or pre-payments will be reflected in the revenue reported during subsequent financial reporting periods as the support services to which they relate are delivered. A consequence of the application of this prudent revenue recognition policy is that the increase in administrative costs to equip the Company to deliver to endorsee businesses the services to which it is committed (most of which was incurred in the second half of the year) has been significantly greater than the growth in revenue during the same time-span. Over successive, future financial reporting periods, if the Company’s business progresses as the Directors presently anticipate, the effects of applying this policy to the recognition of income should diminish and the disparity evident in 2020 between the growth of costs and the growth of revenue should show convergence.

Significant Features of Financial 2020

In early May 2020, Startup Giants was approved by the Home Office as an Endorsing Body for the Innovator Route and Start-up Route visa categories, with its profile published on the Government website. This has enabled the Company to source investment opportunities globally, and directly to sponsor foreign entrepreneurs from non-EU countries to bring their innovation to the U.K., providing support over several years to facilitate growth, including help with future capital raising. Applicants must demonstrate and prove innovation, viability and scalability in order to qualify for endorsement. A range of sectors is considered, with a bias towards Tech, Software-as-a-Service (SaaS), FinTech, AdTech, PropTech, Manufacturing, and Supply Chain, where Startup Giants’ management has prior experience and expertise.

Current Trading and Post-Balance Sheet Events

Trading during the current financial year hitherto has been in line with the Directors’ expectations at the beginning of the period. The Company has during the current year to date endorsed further overseas founders under the Innovator Route and Start-up Route described above and entered into support services agreements with a number of these endorsee businesses. Each such support agreement provides, additionally, for the Company, at its election, to invest at a future date in the endorsee’s business.

Post- Balance Sheet Developments

Startup Giants announced on 19th April 2021 the placing of 223,178 new ordinary shares of five pence each at a price of £0.85 (eighty-five pence) each for cash, to raise approximately £190,000 (one hundred and ninety thousand pounds) gross. Simultaneously, 14,713 new shares were issued at the same price to certain creditors in full settlement of liabilities marginally exceeding £12,500 (twelve thousand five hundred pounds). The additional permanent equity capital raised from incoming investment should enable the Company to increase the resources it can dedicate to supporting an expanding number of entrepreneurs without diminishing the capital available for investment, should exceptional opportunities present themselves.

Outlook

Looking ahead, the momentum for technology companies requiring investment at the seed stage should continue, with demand for the Company’s support model, which encompasses a delivery crew to support young start-ups with their technology and digital marketing strategies, showing signs of continuing to increase.

For reasons explained above in the “Financial Results” commentary the Directors believe, on the basis of satisfactory current trading to date, that the financial statements in respect of the current financial year likely to show a marked convergence between the Company’s revenues and its operating costs compared with the previous twelve months’ period.

Forthcoming Changes of Directorate

At the Annual General Meeting (“AGM”) discussed below, Virginia Filmer-Sankey will be retiring from the Board of Directors by rotation and shall not be offering herself for re-election for a further term. Virginia has been a Director since prior to the Company’s market admission in 2017 and, on behalf of my colleagues at Startup Giants, I would like to thank her for her service and wish her every success in the future.

In Virginia’s stead the Directors will propose the election of Steven Paul Tuson (46) as a Director of the Company. Steve, a UK national, holds a M.Sc. from the University of Maastricht, Netherlands, in International Business Studies. He is a regulated financial services and investment professional who operates his business from Brussels, where he is currently a resident. Steve’s role at Startup Giants will be non-executive. The Directors expect him to provide valuable guidance and help in corporate development and cementing ties with potential co-investors in some of the Company’s portfolio of opportunities. A résumé of Steve Tuson will be available from the Company’s website at https://startupgiants.com.

AGM

The Company’s AGM will be held at 11:00 a. m. BST on Tuesday 29th June 2021. Notice of the AGM giving full details of the location and the resolutions to be laid before shareholders will be included with the Annual Report, which will be posted to shareholders by 5th June 2021.

Conclusion

I wish to thank my Board colleagues and the shareholders for their support and I look forward to reporting on future developments as and when this is appropriate.

Jeb Buckler, Chairman and Chief Executive Officer

London, 2nd June 2021

STARTUP GIANTS PLC

STATEMENT OF COMPREHENSIVE INCOME

FOR THE YEAR ENDED 31 DECEMBER 2020

2020

2019

Notes

£

£

Revenue

2

87,461

45,256

Gross profit

87,461

45,256

Administrative expenses

(234,477)

(130,807)

Operating loss

3

(147,016)

(85,551)

Finance costs

6

(1,083)

-

Other gains and losses

7

(40,000)

-

Loss before taxation

(188,099)

(85,551)

Income tax expense

-

-

Loss and total comprehensive income for the year

(188,099)

(85,551)

Earnings per share (in pence)

8

Basic

(18.62)

(8.47)

Diluted

(18.62)

(8.47)

Earnings per share from continuing operations (in pence)

Basic

(18.62)

(8.47)

Diluted

(18.62)

(8.47)

The income statement has been prepared on the basis that all operations are continuing operations.

STARTUP GIANTS PLC

STATEMENT OF FINANCIAL POSITION

AS AT 31 DECEMBER 2020

2020

2019

Notes

£

£

Non-current assets

Goodwill

10

22,084

27,084

Investments

-

40,000

22,084

67,084

Current assets

Trade and other receivables

11

16,064

50,624

Current tax recoverable

14,915

-

Cash and cash equivalents

675,958

641,989

706,937

692,613

Current liabilities

Trade and other payables

14

241,350

124,971

Current tax liabilities

15,998

-

Borrowings

13

2,963

-

260,311

124,971

Net current assets

446,626

567,642

Non-current liabilities

Borrowings

13

22,083

-

Net assets

446,627

634,726

Equity

Called up share capital

15

140,510

140,510

Share premium account

16

769,790

769,790

Retained earnings

(463,673)

(275,574)

Total equity

446,627

634,726

The financial statements were approved by the board of directors and authorised for issue on 29 May 2021 and are signed on its behalf by:

V Filmer-Sankey

Director

Company Registration No. 09690364

STARTUP GIANTS PLC

STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED 31 DECEMBER 2020

Share capital

Share premium account

Retained earnings

Total

£

£

£

£

Balance at 1 January 2019

140,510

769,790

(190,023)

720,277

Year ended 31 December 2019:

Loss and total comprehensive income for the year

-

-

(85,551)

(85,551)

Balance at 31 December 2019

140,510

769,790

(275,574)

634,726

Year ended 31 December 2020:

Loss and total comprehensive income for the year

-

-

(188,099)

(188,099)

Balance at 31 December 2020

140,510

769,790

(463,673)

446,627

STARTUP GIANTS PLC

STATEMENT OF CASH FLOWS

FOR THE YEAR ENDED 31 DECEMBER 2020

2020

2019

Notes

£

£

£

£

Cash flows from operating activities

Cash generated from/(absorbed by) operations

20

8,969

(4,464)

Interest paid

(1,083)

-

Tax refunded/(paid)

1,083

-

Net cash inflow/(outflow) from operating activities

8,969

(4,464)

Financing activities

Proceeds of new bank loans

25,000

-

Net cash generated from/(used in) financing activities

25,000

-

Net increase/(decrease) in cash and cash equivalents

33,969

(4,464)

Cash and cash equivalents at beginning of year

641,989

646,453

Cash and cash equivalents at end of year

675,958

641,989

This announcement has been made after due and careful enquiry and the Directors of Startup Giants PLC accept responsibility for its content.

A copy of the Annual Report and Financial Statements, from which the financial statements reproduced here are extracted, will be uploaded onto the Company’s website https://startupgiants.com immediately following the posting to shareholders.

REGULATORY ANNOUNCEMENT ENDS

Enquiries:

Startup Giants PLC

Jeb Buckler; jeb@startupgiants.com; +44 747 794 9933

Keith, Bayley, Rogers & Co. Limited

Graham Atthill-Beck; +44 7506 43 41 07; Graham.Atthill-Beck@kbrl.co.uk; blackpearladvisers@gmail.com