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Advancedadvt Limited - Interim Report for the period ended 31 Dec 2020

31/03/2021
RNS Number : 0401U
Advancedadvt Limited
31 March 2021
 

THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA, THE REPUBLIC OF SOUTH AFRICA, JAPAN, ANY MEMBER STATE OF THE EUROPEAN ECONOMIC AREA OR ANY JURISDICTION IN WHICH IT WOULD BE UNLAWFUL TO DO SO.

 

LEI: 254900WYO35S1T334A28

 

AdvancedAdvT Limited

(the "Company")

Interim Report for the period ended 31 December 2020

 

The Company announces its interim results for the period ended 31 December 2020.

The Interim Report is also available on the 'Shareholder Documents' page of the Company's website at www.advancedadvt.com.

 

Enquiries: 

 

Company Secretary

Antoinette Vanderpuije - 020 7004 2700

 

Finsbury - PR Adviser 

Rollo Head 07768 994 987 

Chris Sibbald 07855 955 531 

 

Nplus1Singer Capital Markets Limited - Broker 020 7496 3000

Phil Davies

Iqra Amin 

 

AdvancedAdvT Limited
(formerly Marwyn Acquisition Company I Limited)

Unaudited Interim Condensed Consolidated Financial Statements for the period from incorporation on 31 July 2020 to 31 December 2020

 

Management Report 

 

I present to shareholders the unaudited interim condensed consolidated financial statements of AdvancedAdvT Limited (formerly Marwyn Acquisition Company I Limited) (the "Company") for the period from incorporation on 31 July 2020 to 31 December 2020 (the "Consolidated Interim Financial Statements"), consolidating the results of AdvancedAdvT Limited and MAC I (BVI) Limited (collectively, the "Group").

Activity, Strategy & Outlook

The Company was incorporated on 31 July 2020 and subsequently listed on the Main Market of the London Stock Exchange on 4 December 2020. The Company has been formed for the purpose of effecting a merger, share exchange, asset acquisition, share or debt purchase, reorganisation or similar business combination with one or more businesses.

The Company's objective is to generate attractive long term returns for shareholders and to enhance value by supporting sustainable growth, acquisitions and performance improvements within the acquired companies.

On 31 December 2020, I was appointed as Chairman of the Company, in part for my experience in the software, technology and support services sectors, having executed a number of highly successful growth strategies over my career so far.

On 5 February 2021, the Company announced the issue of 2,500,000 A ordinary shares for £1 per share, with matching A warrants, to provide additional working capital to the support the Company in the execution of its stated investment strategy.  This amount was drawn down under the Forward Purchase Agreement entered into by the Company on IPO.  The Company actively pursued an investment opportunity in the software sector during the first few months of 2021, however, this did not ultimately lead to a completed transaction. On 18 March 2021, it was announced that the A Ordinary Shares would be converted into Ordinary shares and the matching A warrants would be waived effective on 23 March 2021, as disclosed in more detail in note 18.

With strong investor support for the Company's management team and strategy, on 18 March 2021 the Company announced that it had raised a total of £130 million by way of a placing of, and subscription for, new ordinary shares at £1 per share. The new ordinary shares were admitted to the standard segment of the Official List and to trading on the London Stock Exchange's Main Market on 23 March 2021 ("Admission"). On the same date, the Company also announced the appointment of Gavin Hugill as Chief Operating Officer with effect from 12 April 2021 as well as the appointment of Karen Chandler as Non-Executive Director and the resignation of Mark Brangstrup Watts, both of which were effective from Admission.

Over the past quarter of a century companies across all sectors have increasingly adopted new digital technologies to optimise business processes and operations. Implementing these new technologies has become central to driving cost efficiencies and gaining a competitive advantage in a digital world, where sectors and businesses with the highest level of digitalisation display the largest productivity growth.

Despite the opportunities presented by digitalisation, pre Covid-19 adoption of new technologies by businesses and consumers was in part restricted by the willingness of companies to invest in and adopt new systems and technologies.

The global restrictions caused by Covid-19 have helped to break down these barriers and forced businesses to become more agile which has considerably accelerated digitalisation. Despite spending cuts by businesses due to the Covid-19 pandemic, spending on digital transformation has increased as organisations rapidly adapt their business models. A McKinsey study1 found that businesses have accelerated the digitalisation of their customer and supply-chain interactions and of their internal operations by three to four years.

The Directors and the Proposed Directors believe the trend to increased digitalisation of business processes and operations described above will continue as we return to a new normal, as businesses seek to maintain competitiveness and ensure productivity. Businesses providing software and tools enabling digitalisation will therefore be expected to maintain an increased demand for their products.

The Directors and Gavin Hugill have significant experience in the software sector having invested in and/or operated a range of high performing software businesses. The Directors have successfully driven operational excellence within these businesses to deliver organic growth and have a track record of carrying out targeted accretive M&A in the software sector having completed more than 40 bolt-on acquisitions. The £130 million fundraise confirms the Directors' belief that leading investors are now embracing the use of public markets to deploy significant amounts of capital through listed acquisition companies, and that blue-chip institutional investors are supporting listed acquisition companies both pre and post-acquisition. Likewise, vendors are increasingly pursuing transactions with listed acquisition companies to access public markets.  As a result, the Directors are confident in the Company's ability to execute its investment strategy.

The Company's strategy is disclosed in detail in the Company's latest prospectus which can be found on the Company's website: https://advancedadvt.com/investors/shareholder-documents.

1 https://www.mckinsey.com/business-functions/strategy-and-corporate-finance/our-insights/how-covid-19-has-pushed-companies-over-the-technology-tipping-point-and-transformed-business-forever

Results

The Group's loss after taxation for the period to 31 December 2020 was £246,976. The Group held a cash balance at the period end of £538,141.

 

Dividend Policy

The Company has not yet acquired a trading operation and it is therefore inappropriate to make a forecast of the likelihood of any future dividends. The Directors intend to determine the Company's dividend policy following completion of a platform acquisition and, in any event, will only commence the payment of dividends when it becomes commercially prudent to do so.

 

Corporate Governance

As a company with a Standard Listing, the Company is not required to comply with the provisions of the UK Corporate Governance Code. Nevertheless, the Board is committed to maintaining high standards of corporate governance and will consider whether to voluntarily adopt and comply with the UK Corporate Governance Code as part of any acquisition, taking into account the Company's size and status at that time.

The Company currently complies with the following principles of the UK Corporate Governance Code:

·     The Company is led by an effective and entrepreneurial Board, whose role is to promote the long term sustainable success of the Company, generating value for shareholders and contributing to wider society.

·     The Board ensures that it has the policies, processes, information, time and resources it needs in order to function effectively and efficiently.

·     The Board ensures that the necessary resources are in place for the company to meet its objectives and measure performance against them.

 

Given the size and nature of the Company, the Board has not established any committees and intends to make decisions as a whole. If the need should arise in the future, for example following any acquisition, the Board may set up committees as appropriate.

 

Risks

The Directors have carried out a robust assessment of the principal risks facing the Group including those that would threaten its business model, future performance, solvency or liquidity. The Company has published its principal risks in the Company's prospectuses dated 4 December 2020 and 18 March 2021. The Directors are of the opinion that the risks detailed in the Company's prospectus dated 18 March 2021 are applicable for the remaining six months of the financial year. Details of the risks faced by the Group are set out on pages 11-20 of the Prospectus which can be found on the Company's website www.advancedadvt.com.

 

Responsibility Statement 

 

Each of the Directors confirms that, to the best of their knowledge:

(a) these Consolidated Interim Financial Statements, which have been prepared in accordance with IAS 34 "Interim Financial Reporting" as adopted by the European Union, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Group; and

(b) these Consolidated Interim Financial Statements comply with the requirements of DTR 4.2

Neither the Company nor the Directors accept any liability to any person in relation to the interim financial report except to the extent that such liability could arise under applicable law.

Details on the Company's Board of Directors can be found on the Company website at www.advancedadvt.com.

 

Vin Murria OBE
Chairman
30 March 2021

Independent Review Report 

 

INDEPENDENT REVIEW REPORT TO ADVANCEDADVT LIMITED

Introduction

We have been engaged by AdvancedAdvT Limited (formerly Marwyn Acquisition Company I Limited)  (referred to as "the Company", "you" and derivatives thereof and together with each of its subsidiary undertakings is referred to as "the Group") to review the unaudited condensed set of consolidated financial statements in the interim report of the Group for the period from 31 July 2020 to 31 December 2020 which comprise the unaudited consolidated statement of comprehensive income, unaudited consolidated statement of financial position, unaudited consolidated statement of changes in equity, unaudited consolidated cash flow statement, and related explanatory notes to the unaudited consolidated financial statements.

We have read the other information contained in the interim report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the unaudited condensed set of consolidated financial statements.

Directors' Responsibilities

The interim report is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the interim report in accordance with IAS 34, Interim Financial Reporting ("IAS 34").

As disclosed in the condensed set of financial statements, the annual financial statements of the Group will be prepared in accordance with IFRS. The unaudited condensed set of financial statements included in the interim report has been prepared in accordance with IAS 34.

Our Responsibility

Our responsibility is to express to the company a conclusion on the unaudited condensed set of financial statements in the interim report based on our review.

Our report has been prepared in accordance with the terms of our engagement. No person is entitled to rely on this report unless such a person is a person entitled to rely upon this report by virtue of and for the purpose of our terms of engagement or has been expressly authorised to do so by our prior written consent. Save as above, we do not accept responsibility for this report to any other person or for any other purpose and we hereby expressly disclaim any and all such liability.

Scope of Review

We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, ''Review of Interim Financial Information Performed by the Independent Auditor of the Entity'' issued by the Auditing Practices Board Limited for use in the United Kingdom and Ireland. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the unaudited condensed set of financial statements in the interim report for the period ended 31 December 2020 is not prepared, in all material respects, in accordance with IAS 34.

 

Baker Tilly Channel Islands Limited

Date: 30/03/21

Address: First floor, Kensington Chambers, 46-50 Kensington Place, St Helier, Jersey JE4 0ZE

 

Consolidated Statement of Comprehensive Income

 

 

 

Period
ended

 

 

31 December

 

 

2020

 

Note

Unaudited

 

 

£

 

 

 

Administrative expenses

6

(246,976)

Total operating loss

 

(246,976)

 

 

 

Income tax

7

-

Loss for the period

 

(246,976)

Total comprehensive loss for the period attributable to owners of the parent

 

 

(246,976)

 

 

 

Loss per ordinary share (£)

 

 

Basic

8

(0.35)

Diluted

8

(0.18)

 

 

The Group's activities derive from continuing operations.

 

The Notes on pages 10 to 24 form an integral part of these Consolidated Interim Financial Statements.

 

Consolidated Statement of Financial Position

 

 

As at

31 December

2020

 

Note

Unaudited

 

 

£

Current assets

 

 

Trade and other receivables

10

20,192

Cash and cash equivalents

11

538,141

Total current assets

 

558,333

 

 

 

Total assets

 

558,333

 

 

 

Equity and liabilities

 

 

Equity

 

 

Sponsor share

13

1

Ordinary shares

13

326,700

Warrant reserve

13

98,000

Share-based payment reserve

 

169,960

Accumulated losses

 

(246,976)

Total equity

 

347,685

 

 

 

Current liabilities

 

 

Trade and other payables

12

210,648

Total liabilities

 

210,648

 

 

 

Total equity and liabilities

 

558,333 

 

 

The Notes on pages 10 to 24 form an integral part of these Consolidated Interim Financial Statements.

 

The financial statements were approved by the Board of Directors on 30 March 2021 and were signed on its behalf by:

 

 

 

Vin Murria

James Corsellis

Chairman

Director


 

 

Consolidated Statement of Changes in Equity

 

 

 Notes

Ordinary shares

 

Sponsor share

 

Warrant reserve

 

Share based payment reserve

 

 

 

Total equity

 

 

Accumulated losses

 

 

£

 

£

 

£

 

£

 

£

 

£

Balance as at 31 July 2020

 

 -

 

-

 

-

 

 

 

-

 

-

Issuance of 1 ordinary share

13

1

 

-

 

-

 

-

 

-

 

1

Redesignation of 1 ordinary share

13

(1)

 

1

 

-

 

-

 

-

 

0

Issuance of 700,000 ordinary shares and matching warrants

602,000

 

 -

 

98,000

 

 -

 

 -

 

            700,000

Share issue costs

13

(275,300)

 

 

 

 

 

(275,300)

Loss and total comprehensive loss for the period

 14

             -

 

 

-                

 

 

(246,976)

 

(246,976)

Share-based payment expense

 

                -

 

 

 

            169,960

 

               -

 

            169,960

Balance as at 31 December 2020

 

326,700

 

1

 

98,000

 

169,960

 

(246,976)

 

347,685

 

The Notes on pages 10 to 24 form an integral part of these Consolidated Interim Financial Statements.

 

  Consolidated Statement of Cash Flows

 

 

 

 

 

 

For the period ended

31 December

2020

 

Note

 

Unaudited

 

 

 

£

 

 

 

 

Operating activities

 

 

 

Loss for the period

 

 

(246,976)

 

 

 

 

Adjustments to reconcile total operating loss to net cash flows:

 

 

 

Add back share-based payment expense

 

 

154,960

Working capital adjustments:

 

 

 

        Increase in trade and other receivables and

        Prepayments

 

 

(20,192)

        Increase in trade and other payables

 

 

210,648

Net cash flows used in operating activities

 

 

98,440

 

 

 

 

Financing activities

 

 

 

Proceeds from issue of ordinary share capital and matching warrants

 13

 

700,001

Proceeds from issue of A share capital in MAC I (BVI) Limited

 

 

15,000

Cost of share issuance 

13

 

(275,300)

Net cash flows from financing activities

 

 

439,701

 

 

 

 

Net increase in cash and cash equivalents

 

 

538,141

Cash and cash equivalents at the beginning of the period

 

 

-

Cash and cash equivalents at the end of the period

11

 

538,141

 

The Notes on pages 10 to 24 form an integral part of these Consolidated Interim Financial Statements.

Notes to the Consolidated Financial Statements

 

1.    GENERAL INFORMATION

AdvancedAdvT Limited (formerly Marwyn Acquisition Company I Limited) was incorporated on 31 July 2020 in the British Virgin Islands ("BVI") as a BVI business company (registered number 2040954) under the BVI Business Company Act, 2004. The Company was listed on the Main Market of the London Stock Exchange on 4 December 2020 and has its registered address at Commerce House, Wickhams Cay 1, P.O. Box 3140, Road Town, Tortola, British Virgin Islands VG1110 and UK establishment at 11 Buckingham Street, London WC2N 6DF. The Company has been formed for the purpose of effecting a merger, share exchange, asset acquisition, share or debt purchase, reorganisation or similar business combination with one or more businesses. The Company has one wholly-owned subsidiary, MAC I (BVI) Limited (together with the Company, the "Group").

2.    ACCOUNTING POLICIES

(a)    Basis of preparation

The Consolidated Interim Financial Statements have been prepared in accordance with the IAS 34 Interim Financial Reporting and are presented on a condensed basis.

 

The interim report does not include all of the notes of the type normally included in an annual financial report. There have been no annual financial statements prepared to date as this is the first interim period, however this report should be read in conjunction with any public announcements made by the Company during the interim period.

 

The Company was incorporated on 31 July 2020, and therefore these Consolidated Interim Financial Statements are the first set of financial statements issued by the Company and as such no comparatives are available. 

The principal accounting policies adopted in the preparation of the Consolidated Interim Financial Statements are set out below. The policies have been consistently applied throughout the period presented, unless otherwise stated.

(b)   Going concern

The Consolidated Interim Financial Statements have been prepared on a going concern basis, which assumes that the Group will continue to be able to meet its liabilities as they fall due within the next 12 months from the date of approval.  

(c)    New standards and amendments to International Financial Reporting Standards

Standards, amendments and interpretation effective and adopted by the Group

IFRSs applicable to the Consolidated Interim Financial Statements of the Group for the period from 31 July 2020 to 31 December 2020 have been applied.

Standards issued but not yet effective

The following standards are issued but not yet effective. The Group intends to adopt these standards, if applicable, when they become effective. It is not expected that these standards will have a material impact on the Group.

 

Standard

Effective date

Amendments to IFRS 3 Business Combinations: References to the Conceptual Framework in IFRS Standards

1 January 2022*

Amendments to IAS 16 Property, Plant and Equipment

1 January 2022*

Amendments to IAS 37 Provisions, Contingent Liabilities and Contingent Assets: Onerous contracts - cost of fulfilling a contract

1 January 2022*

Amendments to Annual Improvements 2018-2020

1 January 2022*

Amendments to IAS 1 Presentation of Financial Statements: Classification of Liabilities as Current or Non-current

1 January 2022*

IFRS 17 Insurance contracts

1 January 2023*

* subject to EU endorsement

(d)   Basis of consolidation

Subsidiaries are entities controlled by the Company. Control exists when the Company is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. The financial information of subsidiaries is fully consolidated from the date that control commences until the date that control ceases. Intragroup balances, and any gains and losses or income and expenses arising from intragroup transactions, are eliminated in preparing the historical financial information.

(e)   Cash and cash equivalents

Cash and cash equivalents comprise cash balances at banks.

(f)    Stated capital

Ordinary shares and sponsor shares are classified as equity. Incremental costs directly attributable to the issue of new shares are shown in the associated stated capital as a deduction from the proceeds.

(g)    Share based payments

The A ordinary shares in MAC I (BVI) Limited (the ''Incentive Shares''), represent equity-settled share-based payment arrangements under which the Company receives services as a consideration for the additional rights attached to these equity shares.

Equity-settled share-based payments to Directors and others providing similar services are measured at the fair value of the equity instruments at the grant date. The fair value is expensed, with a corresponding increase in equity, on a straight-line basis from the grant date to the expected exercise date. Where the equity instruments granted are considered to vest immediately, the services are deemed to have been received in full, with a corresponding expense and increase in equity recognised at grant date.

(h)   Warrants

On 4 December 2020, the Company issued 700,000 ordinary shares and matching warrants. Under the terms of the warrant instrument, warrant holders are able to acquire one ordinary share per warrant at a price of £1 per ordinary share.  Warrants are accounted for as equity instruments under IAS 32 and are measured at fair value at the date of issue. Fair value of the warrants has been calculated using a Black Scholes option pricing methodology and details of the estimates and judgements used in determining the fair value of the warrants are set out in note 3.  

(i)     Corporation tax

Corporation tax for the period presented comprises current and deferred tax. 

Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantially enacted at the balance sheet date, and any adjustment to taxes payable in respect of previous years.

Deferred tax is provided using the balance sheet liability method, providing for temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes.

A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be available against which the asset can be utilised. Deferred tax assets are reduced to the extent that it is not probable that the related tax benefit will be realised.

(j)     Earnings per ordinary share

Earnings per ordinary share ("EPS") is calculated by dividing the profit or loss attributable to ordinary shareholders of the Company by the weighted average number of ordinary shares outstanding during the period. Diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares outstanding to assume conversion of all dilutive potential ordinary shares.

(k)    Financial instruments

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.

Financial assets
Initial recognition and measurement

Financial assets are classified, at initial recognition, as subsequently measured at fair value through profit or loss ("FVPL"), amortised cost, or fair value through other comprehensive income ("FVOCI").

The classification of financial assets at initial recognition depends on the financial asset's contractual cash flow characteristics and the Company's business model for managing them. In order for a financial asset to be classified and measured at amortised cost or FVOCI, it needs to give rise to cash flows that are 'solely payments of principal and interest' on the principal amount outstanding (the "SPPI Criterion").

Financial assets are initially measured at their fair value plus, for those financial assets not at fair value through profit or loss, transaction costs.

Subsequent measurement

For the purposes of subsequent measurement, all of the Group's financial assets are classified as financial assets at amortised cost. Financial assets at amortised cost comprise of assets that are held within a business model with the objective to hold the financial assets in order to collect contractual cash flows that meet the SPPI Criterion. This category includes the Group's other receivable. This asset is subsequently measured at amortised cost using the effective interest method. The amortised cost is reduced by impairment losses, interest income, foreign exchange gains and losses and impairment losses are recognised in profit or loss. Any gain or loss on derecognition is recognised in profit or loss.

The Group has not classified any assets as being financial assets at FVOCI or FVPL.

Derecognition

A financial asset is primarily derecognised and removed from the consolidated statement of financial position when the rights to receive cash flows from the asset have expired.

Financial liabilities
Initial recognition and measurement

Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss. All financial liabilities are recognised initially at fair value and, in the case of payables, net of directly attributable transaction costs.

Subsequent measurement

Financial liabilities are subsequently measured at amortised cost and in the case of interest-bearing financial liabilities at amortised cost using the effective interest rate method. Gains and losses are recognised in the Statement of Comprehensive Income when the liabilities are derecognised.

Derecognition

A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires.

3.    CRITICAL ACCOUNTING JUDGEMENTS AND ESTIMATES

The preparation of the Consolidated Interim Financial Statements under IFRS requires the Directors to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities. Estimates and judgements are continually evaluated and are based on historical experience and other factors including expectations of future events that are believed to be reasonable under the circumstances. Actual results may differ from these estimates.

There are significant estimates and assumptions used in the valuation of the A ordinary shares in MAC I (BVI) Limited (the "Incentive Shares"). Management has considered at the grant date, the probability of a successful first acquisition by the Company and the potential range of value for the Incentive Shares, based on the circumstances on the grant date. The fair value of the Incentive Shares and related share-based payment expense was calculated using a Monte Carlo valuation model. A summary of the terms is set out in note 14.

As part of the Company's initial fundraising on IPO, the Company issued ordinary shares to a number of investors. For every ordinary share subscribed for, each investor was also granted a warrant ("Warrant") to acquire a further ordinary share at an exercise price of £1.00 per share. The Warrants are exercisable at any time until five years after the IPO date, being 4 December 2020. The Warrants were valued using the Black Scholes option pricing methodology which considered the exercise price, expected volatility, risk free rate, expected dividends

and expected term of the Warrants.

For the period to 31 December 2020, the Directors do not consider that they have made any other significant estimates, judgments or assumptions which would materially affect the balances and results reported in these financial statements.

4.    SEGMENT INFORMATION

The Board of Directors is the Group's chief operating decision-maker. As the Group has not yet commenced trading, the Board of Directors considers the Group as a whole for the purposes of assessing performance and allocating resources, and therefore the Group has one reportable operating segment.

5.    EMPLOYEES AND DIRECTORS

The Group does not have any employees.  During the period ended 31 December 2020, the Company had two directors: James Corsellis and Mark Brangstrup Watts, neither director received remuneration under the terms of their director service agreements.

On 31 December 2020, Vin Murria OBE was appointed as Chairman of the Company. Under the terms of Vin Murria OBE's service agreement, Vin was entitled to £50,000 per annum, but she has waived her entitlement to that until completion of the first acquisition (and similarly, James Corsellis will be paid £50,000 per annum from then) as disclosed in more detail in note.

 

6.    ADMINISTRATIVE EXPENSES BY NATURE

 

 

For the period ended 31 December 2020

 

 

£

Group administrative expenses by nature

 

 

Professional fees

 

46,967

Non-recurring project costs

 

43,705

Listing fees

 

793

Share based payment expense

 

154,960

Branding and website cost

 

527

Bank charges

 

24

 

 

246,976

 

7.    TAXATION

 

 

For the period ended 31 December 2020

 

 

£

Analysis of tax in period

 

 

Current tax on profits for the period

 

-

Total current tax

 

-

 

The central management and control of the Group is exercised in the UK and accordingly the Group is treated as tax resident in the UK.

 

Reconciliation of effective rate and tax charge:  

 

 

For the period ended 31 December 2020

 

 

£

Loss on ordinary activities before tax

 

(246,976)

Expenses not deductible for tax purposes

 

24,861

Loss on ordinary activities subject to corporation tax

 

222,115

Loss on ordinary activities multiplied by the rate of corporation tax in the UK of 19%

 

(42,202)

Effects of:

 

 

Losses carried forward for which no deferred tax recognised

 

42,202

Total taxation charge

 

-

As at 31 December 2020, cumulative tax losses available to carry forward against future trading profits were £42,202 subject to agreement with HM Revenue & Customs. Prior to an acquisition, there is no certainty as to future profits and no deferred tax asset is recognised in relation to these carried forward losses.

 

8.    LOSS PER ORDINARY SHARE

Basic EPS is calculated by dividing the profit attributable to equity holders of a company by the weighted average number of ordinary shares in issue during the year. Diluted EPS is calculated by adjusting the weighted average number of ordinary shares outstanding to assume conversion of all dilutive potential ordinary shares.

 

The Company has issued 700,000 warrants, each of which is convertible into one ordinary share as such the weighted average number of shares has been adjusted in calculating diluted EPS.

 

 

 

For the period ended 31 December 2020

Loss attributable to owners of the parent

 

(246,976)

Weighted average number of ordinary shares in issue

 

700,000

Weighted average number of ordinary shares for diluted EPS

 

1,400,000

 

9.    INVESTMENTS

Principal subsidiary undertakings of the Group

The Company owns directly the whole of the issued ordinary share capital of its subsidiary undertaking. Details of the Company's subsidiary are presented below:

 

 

 

Subsidiary

Nature of business

Country of incorporation

Proportion of ordinary shares held by parent

Proportion of ordinary shares held by the Group

 

 

 

 

 

MAC I (BVI) Limited

 Incentive vehicle

BVI

100%

100%

 

The registered office of MAC I (BVI) Limited Commerce House, Wickhams Cay 1, P.O. Box 3140, Road Town, Tortola, British Virgin Islands VG1110.

 

10.  TRADE AND OTHER RECEIVABLES

 

As at 31 December 2020

 

£

Amounts receivable in one year:

 

Prepayments

5,180

Other receivables

15,001

VAT receivable

11

 

20,192

Other receivables are all current.

There is no material difference between the book value and the fair value of the receivables. Receivables are considered to be past due once they have passed their contracted due date.

 

11.  CASH AND CASH EQUIVALENTS

 

 

As at 31 December 2020

 

£

Cash and cash equivalents

 

Cash at bank

538,141

 

538,141

 

Credit risk is managed on a group basis. Credit risk arises from cash and cash equivalents and deposits with banks and financial institutions. For banks and financial institutions, only independently rated parties with a minimum short-term credit rating of P-1, as issued by Moody's, are accepted.

12.  TRADE AND OTHER PAYABLES

 

As at 31 December 2020

 

£

Amounts falling due within one year:

 

Trade payables

10,068

Accruals

168,080

A ordinary share liability

32,500

 

210,648

 

There is no material difference between the book value and the fair value of the trade and other payables.

13.  EQUITY AND RESERVES

 

Stated capital

Authorised

 

Unlimited ordinary shares of no par value

 

Unlimited A shares of no par value

 

100 sponsor shares of no par value

 

 

As at 31 December 2020

Issued

£

700,000 ordinary shares of no par value

326,700

1 sponsor share of no par value

1

 

On incorporation, the Company issued 1 ordinary share of no par value to MVI I Holdings II LP. On 30 September 2020, it was resolved that updated memorandum and articles ("Updated M&A") be adopted by the Company and with effect from the time the Updated M&A be registered with the Registrar of Corporate Affairs in the British Virgin Islands, the 1 ordinary share which was in issue by the Company be redesignated as 1 sponsor share of no par value (the "Sponsor Share").

 

On 4 December 2020, the Company issued 700,000 of ordinary shares and matching Warrants at a price of £1 for one ordinary share and matching Warrant.  Under the terms of the warrant instrument, warrant holders are able to acquire one ordinary share per warrant at a price of £1 per ordinary share.  Warrants are accounted for as equity instruments under IAS 32 and are measured at fair value at grant date, the combined market value of one ordinary share and one Warrant was considered to be £1, in line with the market price paid by third party investors. A Black Scholes option pricing methodology was used to determine the fair value of the Warrants, which considered the exercise price, expected volatility, risk free rate, expected dividends and expected term. Warrants have been assigned a fair value of 14p per Warrant and therefore each ordinary share has been valued at 86p per share.

Costs of £275,300 directly attributable to the equity raise have been taken against stated capital during the period.

Holders of ordinary shares are entitled to receive notice and attend and vote at any meeting of members, the right to a share in any distribution paid by the Company and a right to a share in the distribution of the surplus assets of the Company on a winding up.

The Sponsor Share confers upon the holder no right to receive notice and attend and vote at any meeting of members, no right to any distribution paid by the Company and no right to a share in the distribution of the surplus assets of the Company on a summary winding up. Provided the holder of the Sponsor Share holds directly or indirectly 5 per cent. or more of the issued and outstanding shares of the Company (of whatever class other than any Sponsor Shares), they have the right to appoint one director to the Board.

The Company must receive the prior consent of the holder of the Sponsor Share, where the holder of the Sponsor Share holds directly or indirectly 5 per cent. or more of the issued and outstanding shares of the Company, or holds incentive shares, in order to:

·      Issue any further Sponsor Shares;

·     issue any class of shares on a non pre-emptive basis where the Company would be required to issue such share pre-emptively if it were incorporated under the UK Companies Act 2006 and acting in accordance with the Pre-Emption Group's Statement of Principles; or

·     amend, alter or repeal any existing, or introduce any new share-based compensation or incentive scheme in respect of the Group; and

·     take any action that would not be permitted (or would only be permitted after an affirmative shareholder vote) if the Company were admitted to the Premium Segment of the Official List

 

The Sponsor Share also confers upon the holder the right to require that: (i) any purchase of ordinary shares; or (ii) the Company's ability to amend the Memorandum and Articles, be subject to a special resolution of members whilst the Sponsor (or an individual holder of a Sponsor Share) holds directly or indirectly 5 per cent. or more of the issued and outstanding shares of the Company (of whatever class other than any Sponsor Shares), or are a holder of incentive shares.

14.  SHARE BASED PAYMENTS

The Company has put in place a long term incentive plan ("LTIP"), to ensure an alignment with all Shareholders, and the high competition for the best executive management talent.

The LTIP will only reward the participants if shareholder value is created. This ensures alignment of the interests of management directly with those of shareholders.

Under the LTIP, A ordinary shares ("Incentive Shares") are issued by the Subsidiary.

As at the statement of financial position date, MLTI and Vin Murria have subscribed for redeemable A ordinary shares of £0.01 each in the Subsidiary entitling them to 100% of the incentive value. 

Preferred Return

The incentive arrangements are subject to the Company's shareholders achieving a preferred return of at least 7.5 per cent. per annum on a compounded basis on the capital they have invested from time to time (with dividends and returns of capital being treated as a reduction in the amount invested at the relevant time) (the "Preferred Return").

Incentive Value

Subject to a number of provisions detailed below, if the Preferred Return and at least one of the vesting conditions have been met, the holders of the Incentive Shares can give notice to redeem their Incentive Shares for ordinary shares in the Company ("Ordinary Shares") for an aggregate value equivalent to 20 per cent. of the "Growth", where Growth means the excess of the total equity value of the Company and other shareholder returns over and above its aggregate paid up share capital (20 per cent. of the Growth being the "Incentive Value").

Grant date

The grant date of the Incentive Shares will be deemed to be the date that such shares are issued.

 

Redemption / Exercise

Unless otherwise determined and subject to the redemption conditions having been met, the Company and the holders of the Incentive Shares have the right to exchange each Incentive Share for Ordinary Shares, which will be dilutive to the interests of the holders of Ordinary Shares. However, if the Company has sufficient cash resources and the Company so determines, the Incentive Shares may instead be redeemed for cash. It is currently expected that in the ordinary course Incentive Shares will be exchanged for Ordinary Shares. However, the Company retains the right to redeem the Incentive Shares for cash instead. Circumstances where the Company may exercise this right include, but are not limited to, where the Company is not authorised to issue additional Ordinary Shares or on the winding-up or takeover of the Company.

Any holder of Incentive Shares who exercises their Incentive Shares prior to other holders is entitled to their proportion of the Incentive Value to the date that they exercise but no more. Their proportion is determined by the number of Incentive Shares they hold relative to the total number of issued shares of the same class.

 

Vesting Conditions and Vesting Period

The Incentive Shares are subject to certain vesting conditions, at least one of which must be (and continue to be) satisfied in order for a holder of Incentive Shares to exercise its redemption right, which right begins on the third anniversary and ends on the seventh anniversary of the date of the Company's initial acquisition.

The vesting conditions are as follows:

i.      it is later than the third anniversary of the initial acquisition;

ii.     a sale of all or substantially all of the revenue or net assets of the business of the Subsidiary in combination with the distribution of the net proceeds of that sale to the Company and then to its shareholders;

iii.    a sale of all of the issued ordinary shares of the Subsidiary or a merger of the Subsidiary in combination with the distribution of the net proceeds of that sale or merger to the Company's shareholders;

iv.    where by corporate action or otherwise, the Company effects an in-specie distribution of all or substantially all of the assets of the Group to the Company's shareholders;

v.     aggregate cash dividends and cash capital returns to the Company's Shareholders are greater than or equal to aggregate subscription proceeds received by the Company;

vi.    a winding up of the Company;

vii.   a winding up of the Subsidiary; or

viii.  a sale, merger or change of control of the Company.

If any of the vesting conditions described in paragraphs (ii) to (viii) above are satisfied before the third anniversary of the initial acquisition, the A Shares will be treated as having vested in full.

Leaver, lock-in and clawback provisions

In addition to the vesting conditions above, Vin Murria OBE has agreed to lock-in periods, leaver provisions, and clawback provisions, in relation to the Incentive Shares she has acquired. It is expected similar provisions would be required from future members of senior management who may acquire Incentive Shares.

On 18 March 2021, MLTI entered into an agreement under which the same lock in period applicable to the shares owned by Vin Murria would apply to the shares held by MLTI.

Vin Murria OBE has agreed that her Incentive Shares will vest on a straight line basis over 3 years from admission, save on an exit event when the Incentive Shares will vest in full. If deemed a good leaver, she will keep her vested Incentive Shares, but otherwise she will lose all of the Incentive Shares upon departure from the Group. Either the Ordinary Shares, or cash received upon exercise of the Incentive Shares and/or the remaining Incentive Shares held by Vin Murria may be clawed back if the holder commits: (i) gross misconduct, (ii) fraud (iii) a criminal act, or (iv) a material breach of any post termination covenants or restrictions in the holder's contract with the Company (if applicable), in each case as determined by the Board in its absolute discretion;

Vin Murria OBE has agreed that if she exchanges some or all of her Incentive Shares for an allotment of Ordinary Shares, she shall not be permitted to enter into an agreement to give effect to any transfer of the Ordinary Shares so allotted at any time during the period of 12 months and one day following the date of such allotment save in certain limited circumstances.

Holding of Incentive Shares

MLTI and Vin Murria hold Incentive Shares entitling them in aggregate to 100 per cent. of the Incentive Value. Any future management partners or senior executive management team members receiving Incentive Shares will be dilutive to the interests of existing holders of Incentive Shares, however the share of the Growth of the Incentive Shares in aggregate will not increase.

 

The following shares were issued on 25 November 2020:

 

 

Nominal price

Issue price

per A ordinary share

Number of A ordinary shares

Unrestricted market value at grant date

IFRS 2

Fair value

Marwyn Long Term Incentive LP

£0.01

£7.50

2,000

£15,000

£169,960

 

The following shares were issued on 31 December 2020:

 

 

Nominal price

Issue price

per A ordinary share

Number of A ordinary shares

Unrestricted market value at grant date

 

IFRS 2

Fair value

Vin Murria OBE

£0.01

£5.42

6,000

£32,500

£354,050

 

Valuation of Incentive Shares

A valuation of the incentive shares has been prepared by Deloitte LLP dated 12 February 2021 to determine the fair value of the Incentive Shares in accordance with IFRS 2 at grant date.

There are significant estimates and assumptions used in the valuation of the Incentive Shares. Management has considered at the grant date, the probability of a successful first acquisition by the Company and the potential range of value for the Incentive Shares, based on the circumstances on the grant date.

The fair value of the Incentive Shares granted under the scheme was calculated using a Monte Carlo model. The fair value uses an ungeared volatility of 25 per cent, and an expected term of seven years. The Incentive Shares are subject to the Preferred Return being achieved, which is a market performance condition, and as such has been taken into consideration in determining their fair value. A risk-free rate of 0% has been applied, based on the average yield on a five-year UK Gilt at the valuation date. The model incorporates a range of probabilities for the likelihood of an acquisition being made of a given size.

 

Expense related to Incentive Shares

An expense of £154,960 has been recognised in the Statement of Comprehensive Income in respect of the Incentive Shares issued to MLTI which is the difference between the IFRS 2 valuation at grant date of £169,960 and the amount paid by MLTI for 2,000 A ordinary shares of £15,000.

15.  FINANCIAL INSTRUMENTS AND ASSOCIATED RISKS

The Group has the following categories of financial instruments at the period end:

 

As at

31 December 2020

 

£

Financial assets measured at amortised cost

 

Cash and cash equivalents

538,141

Other receivables

15,001

 

553,142

 

 

Financial liabilities measured at amortised cost

 

Trade and other payables

210,648

 

210,648

The fair value and book value of the financial assets and liabilities are materially equivalent.

The Group's risk management policies are established to identify and analyse the risks faced by the Group, to set appropriate risk limits and controls, and to monitor risks and adherence limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Group's activities.

Treasury activities are managed on a Group basis under policies and procedures approved and monitored by the Board. These are designed to reduce the financial risks faced by the Group which primarily relate to movements in interest rates.

As the Group's assets are predominantly cash and cash equivalents, market risk and liquidity risk are not currently considered to be material risks to the Group.

 

16.  RELATED PARTY TRANSACTIONS

James Corsellis is a director of the Company and Mark Brangstrup Watts was a director of the Company until his resignation on 23 March 2021,  Antoinette Vanderpuije, is the Company Secretary of the Company. Funds managed by Marwyn Asset Management Limited, of which James Corsellis, Mark Brangstrup Watts and Antoinette Vanderpuije are all non-executive directors and of which Mark Brangstrup Watts and James Corsellis are the ultimate beneficial owners, hold 75% of the Company's issued ordinary shares and Warrants at the statement of financial position date.

James Corsellis, Mark Brangstrup Watts and Antoinette Vanderpuije have a beneficial interest in the Incentive Shares as described in note 14 of the Consolidated Interim Financial Statements through their indirect interest in MLTI which owns 2,000 A ordinary shares in the capital of MAC I (BVI) Limited.  Vin Murria owns 6,000 A ordinary shares in the capital of MAC I (BVI) Limited as detailed in note 14.

James Corsellis and Mark Brangstrup Watts are the managing partners of Marwyn Capital LLP, and Antoinette Vanderpuije is also a partner. Marwyn Capital LLP provides corporate finance advice, company secretarial, administration and accounting services to the Company. As part of this engagement a fee of £150,000 was charged in relation to the listing of the Company. On an ongoing basis a monthly fee of £10,000 per calendar month is charged for the provision of the corporate finance services and as at the statement of financial position date £10,000 is payable by the Company to Marwyn Capital LLP.

James Corsellis and Mark Brangstrup Watts are the managing partners of Marwyn Investment Management LLP, and Antoinette Vanderpuije is also a partner. Marwyn Investment Management LLP incurred costs on behalf of the Group which they recharged. During the period Marwyn Investment Management LLP charged £11,805 in respect of recharged costs of which £67.97 was outstanding at period end.

17.  COMMITMENTS AND CONTINGENT LIABILITIES

There were no commitments or contingent liabilities outstanding at 31 December 2020 that requires disclosure or adjustment in these financial statements.

18.  POST BALANCE SHEET EVENTS

Redesignation of A ordinary shares

On 4 February 2020, the A ordinary shares in the Company's subsidiary MAC I (BVI) Limited were redesignated into A1 ordinary shares and A2 ordinary shares. The A ordinary shares issued to MLTI were redesignated as A2 shares and the A ordinary shares issued to Vin Murria OBE were redesignated as A1 shares. Collectively, the A1 and A2 shares will receive an aggregate of 20% of the growth in value of the Company subject to the conditions and performance hurdles set out in note 14 of these Consolidated Interim Financial Statements, however 15% of the gross incentive value is attributable to the A1 ordinary shares and 5% is attributable to the A2 ordinary shares.

There is no change to the preferred return, grant date, vesting conditions, exercise conditions and lock in conditions as a result of the redesignation of the shares.

Appointment of Gavin Hugill

On 5 February 2021, the Company entered into a service agreement with Gavin Hugill, under which Gavin Hugill was appointed as Chief Operations Officer of the Company with effect from 12 April 2021. On 5 February 2021, Gavin was issued 600 A1 ordinary shares  The A1 ordinary shares will be valued by Deloitte using a Monte Carlo model.

 

Issuance of A1 ordinary shares to Karen Chandler.

On 15 February 2021 Karen Chandler was issued 600 A1 ordinary shares in the capital of MAC I (BVI) Limited. The A1 ordinary shares will be valued by Deloitte using a Monte Carlo model.

Incorporation of subsidiary

On 18 February 2021, AdvancedAdvT (Netherlands) B.V was incorporated in the Netherlands. AdvancedAdvT (Netherlands) B.V is 100% owned by MAC I (BVI) Limited and has remained dormant to date.  

Issuance of A Shares in the Company

On 19 February 2021, the Company drew down £2,500,000 under the terms of the forward purchase agreement ("FPA"), which was entered into by the Company and MVI II LP on 27 November 2020, details in relation to the FPA can be found in the Company's prospectus issued on 4 December 2021. 2,500,000 A Shares and matching A Warrants were issued to MVI II Holdings I LP in consideration for the funds. The proceeds of the subscription are to be used to provide the Company with additional funding to support the pursuit of the Company's strategy.

On a liquidation of the Company the assets of the Company available for distribution will be distributed pro rata to the number of shares held by each holder of Ordinary Shares and A Shares. A Shares each rank equally and confer upon the holders the right to participate pro rata to the number of shares held by each holder of ordinary shares and A Shares in respect of dividends and distributions. Holders of A Shares have no right to receive notice of attend or vote as a member at any meeting of members. A Shares are not listed and are able convert into ordinary shares. 

Project Dallas

During Q1 2021 the Company pursued an investment opportunity codenamed Project Dallas and incurred approximately £1.9 million of abort costs in connection with the project.

 

Issue of £130 million of shares

On 18 March 2021, the Company announced that it had raised a total of £130 million by way of a placing of, and subscription for, new ordinary shares of no par value in the Company issued at £1 per share. The amount raised included subscriptions by MVI II Holdings I LP and Vin Murria of £17.5 million each. The new ordinary shares were admitted to the standard segment of the Official List and to trading on the London Stock Exchange's Main Market on 23 March 2021 ("Admission").

Upon Admission:

·      Vin Murria OBE was issued with one sponsor share;

·      all A Shares were converted into ordinary shares and MVI II Holdings I LP waived its right to receive the matching A Warrants; Karen Chandler was appointed as a Non-Executive Director;

·      Mark Brangstrup Watts agreed to resign as a Non-Executive Director;

·      N+1 Singer was appointed as the Company's sole broker;

·    Vin Murria agreed to waive any fee for her services for the period from Admission to completion of the first acquisition;

·    Marwyn Capital LLP agreed to reduce its corporate finance fee to zero for the period from Admission to the completion of the first acquisition.  In addition, James Corsellis agreed not to receive a fee for his services as a non-executive director until completion of the first acquisition; and

·      in accordance with the terms of the FPA, the FPA terminated.

 

On 17 March 2021 Vin Murria OBE was issued a further 9,600 A1 ordinary shares in the capital of MAC I (BVI) Limited. The A1 ordinary shares will be valued by Deloitte using a Monte Carlo model.

 

Advisors

 

Corporate Broker 
Nplus1 Singer Capital Markets Limited
One Bartholomew Lane

London

EC2N 2AX

 

 

Company Secretary 
Antoinette Vanderpuije 
11 Buckingham Street
London

WC2N 6DF

Registrar
Link Market Services (Guernsey) Limited

Mont Crevelt House, Bulwer Avenue

 St Sampson, Guernsey

GY2 4LH
 

Registered Agent and Assistant Company Secretary 
Conyers Corporate Services (BVI) Limited

Commerce House, Wickhams Cay 1

Road Town, VG1110

Tortola, British Virgin Islands

Depository

Link Market Services Trustees Limited

The Registry 34 Beckenham Road

Beckenham

Kent, BR3 4TU

Solicitors to the Company (as to English law)
Travers Smith LLP

10 Snow Hill

London

EC1A 2AL

Auditor
Baker Tilly Channel Islands Limited

First floor, Kensington Chambers

46-50 Kensington Place

St Helier Jersey JE4 0ZE

Solicitors to the Company (as to BVI Law)
Conyers Dill & Pearman

Commerce House, Wickhams Cay 1

Road Town, VG1110

Tortola, British Virgin Islands

UK establishment address  
11 Buckingham Street
London

WC2N 6DF

Corporate Finance Adviser 
Marwyn Capital LLP 
11 Buckingham Street 
London, WC2N 6DF 

 

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