1.       NOTES FORMING PART OF THE CONSOLIDATED FINANCIAL STATEMENTS for the year ended 31 December 2021 Basis of preparation

 

These financial statements have been prepared on the historical cost basis as modified by use of the fair-value basis where required and in accordance with UK adopted International Accounting Standards (IFRS), and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS as at 31 December 2021.

 

The preparation of financial statements in conformity with IFRS requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts in the financial statements which are disclosed in Note 3 to these consolidated financial statements.

 

The consolidated financial statements of the Group are presented in UK Pounds Sterling ("GBP"), rounded to the nearest thousand.

 

1.1     Going concern

These financial statements have been prepared on a going concern basis. The Consolidated Statement of Comprehensive Income shows a loss of £3,377,000 for the year ended 31 December 2021 (2020: £8,233,000 loss). The Consolidated Statement of Financial Position shows net current assets of £177,000 (2020: £1,244,000 net current assets). In assessing going concern the Directors have considered the Group's cash flows, solvency and liquidity positions.

 

Based on the Group's balance sheet and a review of its forecast future operating budgets and forecasts, the Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for at least twelve months from the date of signing of these consolidated financial statements. This review of future operating budgets and forecasts included certain reasonable downside scenarios and confirmed that even in the case of such downside scenarios the Group could continue to operate and comply with all covenants in our banking facilities. Accordingly, the Directors have adopted the going concern basis in preparing the Annual Report and consolidated financial statements.

 

The Directors have assessed the viability of the Group over a five-year period, taking account of the Group's current position and prospects, its strategic plan and the principal risks and how these are managed. Based on this assessment, the Directors have a reasonable expectation that the Group will be able to continue in operation and meet its liabilities as they fall due over this period.

 

In making this assessment, the Directors have considered the resilience of the Group in severe but plausible scenarios, taking into account the principal risks and uncertainties facing the Group and the effectiveness of any mitigating actions. The Directors' assessment considered the potential impacts of these scenarios, both individually and in combination, on the Group's business model, future performance, solvency and liquidity over the period. Sensitivity analysis was also used to stress test the Group's strategic plan and to confirm that sufficient headroom would remain available under the Group's credit facilities. The Directors consider that under each of these scenarios, the mitigating actions would be effective and sufficient to ensure the continued viability of the Group. The Directors believe that five years is an appropriate period for this assessment, reflecting the average length of the Group's contract base; key markets; and the nature of its businesses and products.

                                                    

Consequently, the Directors have prepared these consolidated financial statements on the going concern basis, which assumes that the Group will continue in operational existence for the foreseeable future.

 

1.2     Adoption of standards effective in 2021

The following new and revised Standards and Interpretations have been issued and are effective for the current financial period of the Company:

 

·    Interest Rate Benchmark Reform Phase 2 - amendments to IFRS 9, IAS 39, IFRS 7,
IFRS 4 and IFRS 16; and

·    COVID-19 Related Rent Concessions (Amendment to IFRS 16).

 

1.3     IFRS in issue but not applied in the current financial statements

The following IFRS and IFRIC Interpretations have been issued but have not been applied by the Company in preparing these financial statements as they are not as yet effective. The Company intends to adopt these Standards and Interpretations when they become effective, rather than adopt them early:

 

·    Amendments to IAS 1 - Classification of Liabilities as Current or Non-current;

·    Amendments to IAS 16 - Property, Plant and Equipment: Proceeds before intended use;

·    Amendments to IFRS 3 - Reference to the Conceptual Framework;

·    Amendments to IAS 37 - Onerous Contracts - Cost of Fulfilling a Contract; and

·    Annual Improvements to IFRS Standards 2018-2020.

 

The directors do not expect that the adoption the Standards listed above will have a material impact on the Company in future periods.

 

A number of IFRS and IFRIC Interpretations are also currently in issue which are not relevant for the Company's activities and which have not therefore been adopted in preparing these financial statements.

 

Other new and amended Standards and Interpretations issued by the IASB that will apply for the first time in the next annual financial statements are not expected to impact the Company as they are either not relevant to the Company's activities or require accounting which is consistent with the Company's current accounting policies.

 

2.       Accounting policies

 

2.1.    Basis of consolidation

The consolidated financial statements incorporate:

·       the results of LVCG, Brick Live Group Limited ('Brick Live Group'), Parallel Live Group Limited ('Parallel Live Group'), Bright Bricks Limited ('Bright Bricks Group'), Live Company Sports and Entertainment Limited ('LCSE'), E Movement Holdings Ltd ('EMHL'), Live Company Group EBT Limited ('EBT') and their subsidiary companies for the year ended 31 December 2021.

·       the assets and liabilities of LVCG, Brick Live Group, Parallel Live Group, Bright Bricks Group, LCSE, EMHL, EBT and their subsidiary companies at 31 December 2021.

 

Business combinations

The information contained in this note sets out how the Group typically accounts for Business Combinations, which is effectively using the purchase method explained in IFRS 3, 'Business Combinations'.

 

Subsidiary undertakings are all entities over which the Group has the power to govern the financial and operating policies of the subsidiary and therefore exercises control. The existence and effect of both current voting rights and potential voting rights that are currently exercisable or convertible are considered when assessing whether control of an entity is exercised. Subsidiaries are consolidated from the date at which the Group obtains the relevant level of control and are de-consolidated from the date at which control ceases.

Inter-company transactions, balances and unrealised gains on transactions between Group companies are eliminated. Unrealised losses are also eliminated. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group.

 

The amendments to IFRS 3, 'Business Combinations' have clarified the definition of a business and have permitted a simplified assessment of whether an acquired set of activities and assets is a group of assets rather than a business. The Group has assessed it's acquisitions on the basis of this amendment.

 

The cost of an acquisition is measured as an aggregate of the consideration transferred, measured at the acquisition date fair-value and the amount of any non-controlling interest in the acquiree. For each business combination, the Group measures the non-controlling interest in the acquiree at the proportionate share of the acquiree's identifiable net assets. Subsequent changes in the proportion of the non-controlling interests, which do not result in de-recognition of the subsidiary, are accounted for in equity. Costs incurred in connection with acquisitions are recognised as exceptional costs in the income statement, as incurred.

 

When the Group acquires a business, it assesses the financial assets and liabilities assumed for appropriate classification and designation in accordance with the contractual terms, economic circumstances and pertinent conditions at the acquisition date.

 

If the business combination is achieved in stages, the acquisition date fair-value of the Group's previously held equity interest in the acquiree is re-measured to fair-value at the acquisition date through profit or loss. Goodwill is initially measured at cost being the excess of the consideration transferred over the Group's share of net identifiable assets acquired and liabilities assumed.

 

If this consideration is lower than the fair-value of net assets of the subsidiary acquired, the difference is recognised in profit or loss.

 

After initial recognition, goodwill is measured at cost less any recognised impairment losses. For the purpose of impairment testing, goodwill acquired in a business combination is, from the acquisition date, allocated to either the acquired business or to each of the Group's cash generating units that are expected to benefit from the combination irrespective of whether other assets or liabilities of the acquiree are assigned to those units.

 

Where goodwill forms a part of a cash-generating unit and part of the operation within that unit is disposed of, the goodwill associated with the operation disposed of is included in the carrying amount of the operation when determining the gain or loss on disposal of the operation. Goodwill disposed of in these circumstances is measured based on the relative values of the operation disposed of and the portion of the cash-generating unit until retained.

 

Formal impairment reviews were completed at 30 June 2021 and 31 December 2021 given the indicators of impairment existing at both dates.

 

Brick Live Group

In 2017 the reverse acquisition of LVCG by the Brick Live Group resulted in goodwill arising of £4,581,000. This goodwill was fully impaired in the year ended 31 December 2017.

 

Bright Bricks Group

In October 2018, the Group acquired Bright Bricks Group, resulting in goodwill arising of £86,000. This goodwill was fully impaired in the year ended 31 December 2020.

 

Parallel Live Group

In December 2017, the Group acquired Parallel Live Group, resulting in goodwill arising of £1,271,000. The carrying value of the goodwill was reduced from £896,000 to £884,000 in the year ended 31 December 2021.

 

Brick Live Far East Limited ('BLFE')

In December 2017, the Company became the 100% owner of BLFE. Goodwill of £2,950,000 arose on the acquisition. BLFE is a company registered in Hong Kong which owns a 49% stake in the Brick Live Group's China associate company, Brick Live Centre Education Development (Beijing) Company Limited. This goodwill was fully impaired in the year ended 31 December 2020.

 

Live Company Sports and Entertainment ('LCSE')

In December 2020 the Group established its new LCSE division, through an all share acquisition of Live Company Sports and Entertainment Limited, including its 50% interest in K-Pop Europa Limited; the novation of a number of contracts from World Sport South Africa (Pty) Limited and the acquisition of the entire issued capital of E Movement Holdings Ltd.

 

The substance of these transactions was the acquisition of a series of contracts rather than a business combination as defined in IFRS 3, 'Business Combinations'. The transactions were therefore accounted for as additions to intangible fixed assets of £1,450,000 with no goodwill arising.

 

Intercompany balances

All intercompany balances are eliminated on consolidation.

 

Subsidiary companies audit exemption

The company's active subsidiaries Bright Bricks Limited, Brick Live Group Limited, Brick Live International Limited, Live Company Group EBT Limited, and Parallel Live Group Limited are exempt from the requirements of the Companies Act 2006 relating to the audit of their individual accounts by virtue of section 479A of the Companies Act 2006.

 

2.2.    Intangible fixed assets

Trademarks are registered in each of the geographical territories for the BRICKLIVE brand. Trademarks are amortised on a straight line basis over their estimated useful lives, which is on average 10 years.

 

Acquired contracts are amortised over the period of the rights acquired, where contracts are renewable and are likely to be renewed for a further period such further period, but no subsequent periods, is considered to be part of the period of the rights acquired.

 

2.3.    Investment in associates and joint ventures

An associate is an entity over which the Group has significant influence and that is neither a subsidiary nor an interest in a joint venture. Significant influence is the power to participate in the financial and operating policy decisions of the investee but does not have control or joint control over those policies. The Group uses the equity method of accounting for its associate.

 

A joint venture is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the joint arrangement. Joint control is the contractually agreed sharing of control of an arrangement, which exists only when decisions about the relevant activities require unanimous consent of the parties sharing control. The Group uses the equity method of accounting for its joint ventures.

 

Start Art Global Ltd. ('StART.ART')

In May 2021 the Company subscribed to 389 ordinary shares in Start Art Global Limited. ('StART.Art'), representing a non-controlling stake of 18.6% of the total issued share capital of the company, for a total cash consideration of £1,000,000. Prior to the transaction StART.Art was 100% owned by David Ciclitira and Ranjit Murugason as detailed in Note 32.

 

In November 2021 StART.Art acquired the entire issued share capital of Start (2013) Limited, the promoter of the StART Art Fair, in an all share transaction, resulting in a decrease in the Company's interest in the enlarged group from 18.6% to 14.6% with no diminution of value. Prior to the acquisition Start (2013) Limited was 100% owned by David Ciclitira and Ranjit Murugason as detailed in Note 32.

 

In December 2021 StART.Art issued a further 180 ordinary shares to LVCG for nominal consideration increasing LVCG's holding to 19.9%.

 

The Directors reviewed the investment and concluded LVCG did not exercise significant influence over StART.Art due to its holding being less than the 20% threshold at which significant influence is presumed to exist and there being no contrary indicators of significant influence:

·    Although David Ciclitira and Ranjit Murugason are Directors of both LVCG and StART.Art, LVCG does not have the power to appoint or remove directors of StART.Art;

·    LVCG is not a party to the StART.Art shareholder agreement and has no reserved powers; and

·    LVCG does not participate in the key strategic and operational decisions of StART.Art.

 

E-Movement (PTY) Limited. ('EMPL')

In November 2021 the Company purchased 271 ordinary shares, representing 20% of the total issued share capital, in E Movement (PTY) Limited ('EMPL') from David Ciclitira for a total consideration of £113,460. These shares were originally purchased by David Ciclitira (acting in his personal capacity) for the same amount in anticipation of them being transferred to the Company. EMPL is the South African based promoter of the Cape Town E Prix which has been confirmed for Series 9 of the ABB FIA Formula E World Championship and due to take place in February 2023.

 

The Directors reviewed the investment and concluded LVCG did not exercise significant influence over EMPL despite a shareholding of 20%, being the threshold at which significant influence is presumed to exist. The presumption was rebutted on the basis that EMPL was actively seeking an additional investor which would reduce LVCG's holding below the threshold and that other indicators of significant influence were not met as follows:

·    Although David Ciclitira is a Director of both LVCG and EMPL the board of directors is controlled by EMPL's largest shareholder which is an unrelated third party;

·    LVCG has no reserved powers in the Shareholder Agreement and such powers that are exercisable are exercised jointly with the other shareholders; and

·    LVCG does not participate in the key strategic and operational decisions of EMPL.

 

2.4.    Property, plant and equipment

All property, plant and equipment assets are stated at cost less accumulated depreciation. Content is capitalised in the periods in which they are purchased or completed and valued at the lower of cost and net realisable value.

 

Depreciation is provided on content assets over eight years on a straight-line basis to reflect their useful life. Residual values, remaining useful lives and depreciation methods are reviewed annually and adjusted if appropriate.

 

Depreciation is provided on other fixtures, fittings and office equipment over five years on a straight-line basis. Residual values, remaining useful lives and depreciation methods are reviewed annually and adjusted if appropriate.

 

2.5.    Leases

In accordance with IFRS 16, 'Leases' a right of use asset, being the present value of the operating lease payments over the remaining life of the lease, has been recognised within non-current assets. The right to use assets and corresponding lease liability were calculated using a discount rate of 9% which the Directors consider to be appropriate, based on the Group's current borrowing structure. The depreciation of the assets and interest charge are recognised in the Statement of Comprehensive Income in the year and the buildings maturity analysis of lease liabilities at 31 December 2021 is detailed in Note 25.

 

2.6.    Impairment of assets

The carrying amounts of the Group's assets, other than inventories, are reviewed at each reporting date to determine whether there is any indication of impairment. An impairment loss is recognised whenever the carrying amount of an asset or its cash-generating unit exceeds its recoverable amount. Impairment losses are recognised in the Statement of Comprehensive Income.

 

Where there is an indication that previously recognised impairment losses may no longer exist or may have decreased the previously recognised impairment loss is reversed. The reversal is limited so that the carrying value  of the asset or its cash-generating unit does not exceed either its recoverable amount, or the carrying amount that would have been determined, net of depreciation/amortisation, had no impairment loss been recognised in prior years. Such a reversal is recognised in the Statement of Comprehensive Income.

 

2.7.    Inventories

Inventories are stated at the lower of cost and net realisable value. Cost comprises direct materials and, where applicable, direct labour costs that have been incurred in bringing the inventories to their present location and condition. Cost is calculated using a weighted average cost method. Net realisable value represents the estimated selling price less all estimated costs of completion and costs to be incurred in marketing, selling and distribution. The majority of inventories are measured at fair value following the acquisition of the Bright Bricks Group in October 2018 as detailed in Note 19.

 

2.8.    Financial instruments

Financial assets and financial liabilities are recognised in the Group's statement of financial position when the Group becomes a party to the contractual provisions of the instrument. Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognised immediately in profit or loss.

 

Financial assets

The Group classifies its financial assets as either financial assets measured at amortised cost, fair value through profit and loss or fair value through Other Comprehensive Income (OCI).

 

Financial assets at fair value through OCI consist of equity investments in other companies or limited partnerships where the Group does not exercise either control or significant influence.

 

Financial assets at fair value through OCI are shown at fair value at each reporting date with changes in fair value being shown in OCI. In cases where the Group can reliably estimate fair value, fair value will be determined in reference to practical completion of each development project.

 

All assets for which fair value is measured or disclosed in the financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:

 

•     Level 1 - Quoted (unadjusted) market prices in active markets for identical assets or liabilities;

•     Level 2 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable; and

•     Level 3 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable.

Financial instruments are derecognised on the trade date when the Group is no longer a party to the contractual provisions of the instrument.

 

 

2.9.    Share based payments

The Company issues equity settled share-based payment transactions to certain employees and service providers. Equity settled share-based payment transactions with employees are measured at the fair value at the date of grant. The calculation of fair value at the date of grant requires the use of management's best estimate of volatility, risk free rate and expected time to exercise the options.

 

Equity settled share based payment transactions with service providers are measured at the fair value of the goods or services received, except where the fair value cannot be reliably estimated, in which case they are measured at the fair value of the equity instrument granted, measured at the date the entity obtains the goods or the counterparty renders the service.

 

2.10.  Trade and other receivables

Trade and other receivables are stated at their amortised cost. Trade receivables are reduced by appropriate allowances for estimated irrecoverable amounts.

 

A loss allowance is recognised on initial recognition of financial assets held at amortised cost, based on expected credit losses, and is re-measured annually with changes appearing in profit or loss. Where there has been a significant increase in credit risk of the financial instrument since initial recognition, the loss allowance is measured based on lifetime expected losses. In all other cases, the loss allowance is measured based on 12-month expected losses. For assets with a maturity of 12 months or less, including trade receivables, the 12-month expected loss allowance is equal to the lifetime expected loss allowance.

 

2.11.  Cash and cash equivalents

Cash equivalents comprise short-term, highly liquid investments that are readily convertible into known amounts of cash and which are subject to an insignificant risk of changes in value.

 

2.12.  Trade and other payables

Trade and other payables are stated at their amortised cost.

 

2.13.  Interest-bearing borrowings (other than compound financial instruments)

Interest-bearing borrowings are stated at amortised cost using the effective interest method. The effective interest method is a method of calculating the amortised cost of a financial liability and of allocating interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments through the expected life of the financial liability.

 

2.14.  Revenue recognition

Revenue is the value of goods and services provided by the Group to customers, net of VAT and discounts. Revenue includes licence fees, revenue from the sale of products, rental fees, sale of content (brick-based statues), brick lease fees and ticket sales from self-promoted events.

 

Revenue from contracts is recognised in accordance with IFRS 15 as follows:

i.    Identify the contract with the customer;

ii.    Identify separate performance obligations in the contract;

iii.   Determine the transaction price;

iv.  Allocate the transaction price to separate performance obligations; and

v.   Recognise revenue when the entity satisfies a performance obligation.

Revenue recognised as above is measured on the following basis:

i.    Annual licence fees - on a straight-line basis in accordance with the terms of the agreement, unless it is non-refundable in which case fees are recognised on the contractual invoice date;

ii.    Event licence fees and revenue shares - in accordance with the terms of the agreement;

iii.   Content fees - on delivery of the specific content to the client in accordance with the terms of the agreement;

iv.  Tour and show rental fees - in accordance with the terms of the agreement;

v.   Brick lease fees - on a straight-line basis in accordance with the terms of the agreement;

vi.  Ticket sales from self-promoted events - on the date of the event; and

vii.  Sales of products - in accordance with contract.

 

2.15.  Deferred taxation

Deferred tax is provided in full using the balance sheet liability method. Deferred tax is the future tax consequences of temporary differences between the carrying amounts and tax bases of assets and liabilities shown on the Statement of Financial Position.

 

The amount of deferred tax provided is based on the expected manner of recovery or settlement of the carrying amount of assets and liabilities, using tax rates enacted or substantively enacted at the reporting date.

 

The Group does not recognise deferred tax liabilities, or deferred tax assets, on temporary differences associated with investments in subsidiaries, as it is not considered probable that the temporary differences will reverse in the foreseeable future.

 

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. The carrying amounts of the deferred tax assets are reviewed at each statement of financial position date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the assets to be recovered.

 

2.16.  Segmental reporting

The Group has three operating segments, namely: Models and Sets, Tours and Trails and Sports and Entertainment. In identifying these operating segments, management generally follows the Group's service lines representing its main products and services (see Note 4).

 

For management purposes, the Group uses the same measurement policies as those used in its consolidated financial statements, except for certain items not included in determining the operating profit of the operating segments, such as exceptional costs.

 

In addition, corporate assets and expenses which are not directly attributable to the business activities of any operating segment are not allocated to a segment. This primarily applies to the Group's headquarters.

 

2.17.  Foreign currencies

Monetary assets and liabilities expressed in foreign currencies are translated at the rates of exchange ruling at the reporting date. Transactions in foreign currencies are translated at the rate ruling at the date of the transaction. Differences on exchange arising on translation of subsidiaries are charged directly to other comprehensive income. All other exchange differences have been charged to the profit or loss in the period under review.

 

2.18.  Exceptional items

Exceptional items are those costs incurred by the Group which are considered by the Directors to be material in size and are unusual and infrequent in occurrence which require separate disclosure within the financial statements. See Note 6 for details of exceptional items in the year.

 

2.19.  Government grants and assistance

Government grants and assistance are recognised in the related expense line in the consolidated statement of comprehensive income on a systematic basis over the period in which the entity recognises the expense, for which the grant is intended to compensate.

 

Therefore, grants in recognition  of specific expenses are recognised in the related expense line in the same period.

 

The Group continued to makes use of the Coronavirus Job Retention Scheme receiving a total of £185,000 (2020: £425,000) during the year.

 

2.20.  Reserves

 

Reverse acquisition reserve

The reverse acquisition reserve of (£24,268,000) arose in December 2017 with the acquisition of 100% of the issued share capital of Brick Live Group, 100% of the issued share capital of Parallel Live Group and the remaining 61.1% of Brick Live Far East Limited not already owned indirectly by the Group via Brick Live International Limited, The transaction was treated as a reverse acquisition on a consolidated bases with Brick Live Group Limited considered to be the acquirer for the purposes of the consolidated financial statements with the cumulative acquisition adjustment to adjust comparatives to a consistent basis in the consolidated financial statements treated as a reverse acquisition reserve.

 

Forex reserve

The forex reserve of £570,000 comprises all foreign currency differences arising from translation of the financial position and performance of  certain subsidiaries, which have a functional currency different to the Group's presentation currency of GBP.

 

Own shares reserve

The own share reserve of (£2,111,000) arose in August 2020 on the creation of the Employee Benefit Trust ('EBT'), following the termination of the ESA described in Note 33, and the EBT's acquisition into trust of 5,726,480 ordinary shares in the Company previously held by YA II and RiverFort (representing 6.51%. of the Company's issued share capital at the time). Movement on the reserve reflects changes in the number of shares held by the EBT during the year.

 

Merger reserve

The merger reserve of £14,472,000 comprises:

·    £4,833,333, being the premium recognised on the issue of 16,666,666 new ordinary shares with a nominal value of 1p and a price of 30p in consideration for the entire issued share capital of Brick Live Group Limited in December 2017;

·    £966,666, being the premium recognised on the issue of 3,333,3334 new ordinary shares with a nominal value of 1p and a price of 30p in consideration for the entire issued share capital of Parallel Live Group Limited in December 2017;

·    £2,851,297, being the premium recognised on the issue of 9,832,060 new ordinary shares with a nominal value of 1p and a price of 30p in consideration for the remaining 61.1% of the issued share capital of Brick Live Far East Limited not already owned indirectly by the Company through Brick Live International Limited in December 2017;

·    £5,415,385, being the premium recognised on the issue of 8,461,536 new ordinary shares with a nominal value of 1p and a price of 65p in partial consideration for the entire issued share capital of Bright Bricks Holdings Limited in October 2018; and

·    £405,000, being the premium recognised on the issue of 941.860 new ordinary shares with a nominal value of 1p and a price of 44p in partial consideration for the entire issued share capital of Bright Bricks Holdings Limited in November 2019.

 

Capital Redemption Reserve

The capital redemption reserve of £5,034,000 comprises the cumulative effect of previous reorganisations in the capital of the Company and represents the value of shares redeemed from retained earnings.

 

Share option reserve

The share option and warrant reserve of £515,000 is attributable to the accumulated charge relating to share options and warrants issued by the Company which is recognised over the vesting period of the share option or warrant. This is partially offset by the accumulated charge relating to lapsed share options and warrants, which is transferred to retained earnings.

 

3.       Accounting estimates and judgements

 

The preparation of these consolidated financial statements in accordance with generally accepted accounting practice, being  UK adopted International Accounting Standards, requires the Directors to make estimates and judgements that affect the reported amount of assets, liabilities, income and expenditure and the disclosures made in these consolidated financial statements. Such estimates and judgements are continually evaluated based on historical experience and other factors, including expectations of future events.

 

The significant judgements made by management in applying the Group's accounting policies as set out above, and the key sources of estimation which management consider may have a significant risk of causing a material adjustment to the reported amounts in the year, were:

 

Impairment of investments and goodwill

The Directors have carried out impairment reviews of the Group's intangible assets, goodwill, investments and the share of net assets of associates as detailed in Notes 15, 16, 17 and 18.

 

Depreciation and amortisation

Depreciation rates have been set to accurately reflect the reduction in value of property, plant and equipment assets over their economic life, less their expected residual value. This requires judgement by the Directors, who have set the depreciation rates as detailed in Note 2.4 to these consolidated financial statements based on their knowledge of the industry and typically how long each asset type retains its value.

 

Amortisation rates have been set to reflect the reduction in value of intangible assets over their economic life, less their expected residual value. This requires judgement by the Directors, who have set the amortisation rates as detailed in Note 2.2 to these consolidated financial statements based on their knowledge of the industry and typically how long each asset type retains its value.

 

Revenue recognition with customers

Revenue from contracts with customers is recognised in accordance with IFRS 15. This requires judgement as revenue transactions are subject to a variety of contract terms, albeit under the general guidelines of the accounting policies for revenue recognition as explained in Note 2.14 to these consolidated financial statements.

 

Share option and warrants

The Black-Scholes model is used to calculate the appropriate charge of the share options and warrants. The use of this model to calculate the charge involves a number of estimates and judgements to establish the appropriate inputs to be entered into the model, covering areas such as the use of an appropriate interest rate and dividend rate, exercise restrictions and behavioural considerations. A significant element of judgement is therefore involved in the calculation of the charge.

 

Carrying value of inventory

The Directors have carried out impairment reviews of the Group's inventory as detailed in Note 19. Inventory is not readily replaceable and has a long economic life, a significant element of judgement is therefore involved in assessing it for impairment.

 

Carrying value of content assets

The Directors have carried out impairment reviews of the Group's content assets as detailed in Note 13. Content assets are unique and have a long economic life, a significant element of judgement is therefore involved in assessing them for impairment.

 

 

Accounting treatment of investments, and acquisition

The Company has an interest, both directly and indirectly, in a number of entities over which it exerts a varying degree of control or influence. The accounting treatment of business combinations in accordance with IFRS 3, and also consolidation of subsidiaries under IFRS 10 and treatment of associates under IAS 28 requires a significant element of judgement in assessing the extent to which the acquired entity represents a business combination or acquisition of assets and the extent to which it is controlled or influenced by the Group.

 

 

4.       Segment reporting

 

The Directors have identified the Group's business segments by reference to the principal product and service lines offered and geographical organisation of the business as reported to the Executive Chairman, identified by the Directors as the chief operating decision-maker (CODM).

 

Reportable segments

The reportable segment results for the year ended 31 December 2021 are as follows:

 

	BRICKLIVE		Sports and Entertainment	Unallocated	Total
	Models and Sets	Tours and Trails
	£'000	£'000	£'000	£'000	£'000
Revenue	578	1,247	849	-	2,674
Cost of sales*	437	941	506	-	1,884
Administrative expenses	291	629	309	1,256	2,485
Amortisation and depreciation	53	867	1	228	1,149
Finance costs	-	-	-	108	108
Exceptional items	-	-	-	364	364
Taxation	-	-	-	61	61
Segment (loss)/profit for the year	(203)	(1,190)	33	(2,017)	(3,377)

 

The reportable segment results for the year ended 31 December 2020 were as follows:

 

	BRICKLIVE		Sports and Entertainment	Unallocated	Total
	Models and Sets	Tours and Trails
	£'000	£'000	£'000	£'000	£'000
Revenue	497	1,360	-	-	1,857
Cost of sales*	684	1,166	-	-	1,850
Administrative expenses	540	1,479	-	1,075	3,094
Amortisation and depreciation	21	762	-	42	825
Finance costs	-	-	-	110	110
Exceptional items	-	-	-	4,355	4,355
Taxation	-	-	-	(144)	(144)
Segment (loss)/profit for the year	(748)	(2,047)	-	(5,438)	(8,233)

 

Content depreciation is included with amortisation and depreciation in this note 4 but in cost of sales in the Consolidated Statement of Comprehensive Income on page 38.

 

Administrative expenses are apportioned to each trading segment in proportion to the revenue earned.

 

Segment assets consist primarily of property, plant and equipment, intangible assets, investments, goodwill, trade and other receivables and cash and cash equivalents.

 

Unallocated assets comprise deferred taxation and financial assets held at fair value through profit or loss. Segment liabilities comprise operating liabilities; liabilities such as deferred taxation are not allocated to individual business segments.

 

Segment assets and liabilities as at 31 December 2021 are as follows:

 

	BRICKLIVE		Sports and Entertainment	Unallocated	Total
	Models and Sets	Tours and Trails
	£'000	£'000	£'000	£'000	£'000
Assets	-	10,399	343	1,115	11,857
Labilities	-	5,828	-	607	6,435

 

Segment assets and liabilities as at 31 December 2020 were as follows:

 

	BRICKLIVE		Sports and Entertainment	Unallocated	Total
	Models and Sets	Tours and Trails
	£'000	£'000	£'000	£'000	£'000
Assets	-	10,868	-	1,322	12,190
Labilities	-	5,776	-	645	6,421

 

Geographical information

The Group's business segments operated in five principal geographical areas in the year, although they are managed on a worldwide basis from the Group's head office in the United Kingdom.

 

A geographical analysis of the Group's continuing revenue and non-current assets is given below. Revenue is allocated based on the location of the customer; non-current assets are allocated based on the physical location of the asset.

 

	2021	2020
	£'000	£'000
Revenue
United Kingdom	999	1,013
Europe	321	49
USA	314	265
Asia	147	434
Middle East and Africa	893	96
	2,674	1,857

 

	2021	2020
	£'000	£'000
Non-current assets
United Kingdom	4,721	4,445
Europe	270	-
USA	668	394
South America	-	31
Asia	786	711
Middle East and Africa	-	310
Unallocated	884	896
	7,329	6,787

 

Major customers

Included within BRICKLIVE Tours and Trails are revenues of £128,000 (2020: £225,000) which arose from sales to the Groups largest customer.

 

5.       Operating loss before exceptional items

	2021	2020
	£'000	£'000
This is stated after charging:
Content depreciation (included within cost of sales)	754	705
Loss on disposal of content assets (included within cost of sales)	-	192
Other depreciation and amortisation (included within administrative expenses)	333	57
Inventories recognised as an expense	637	1,036
Depreciation on right of use assets	62	61
Net foreign exchange losses	-	17

 

6.       Exceptional items

 

The exceptional items consist of the following:

	2021	2020
	£'000	£'000
Share options and warrants charge	286	278
Transactional and reorganisational costs	66	2,676
Impairment of associate and intangible assets	12	1,401
	364	4,355

 

 

2021 Exceptional items

 

Share option and warrant charge

Ongoing charges related to options and warrants issued in connection to previous transactional and reorganisational events, the costs of which were treated as exceptional items at the time, continue to be classified as exceptional items in the year they are recognised.

 

The Group uses the Black-Scholes model to value its share option and warrants. Certain judgement is required in terms of selecting the risk-free interest rate and standard deviation rate used. The charge for the current year is £286,000 which may increase or decrease with changes to these rates.

 

Transactional and reorganisational costs

Transactional costs relate to equity raises completed during the year as detailed in Note 27 and the ongoing guarantee fees relating to the HP Agreement entered into with Close Leasing Ltd. in August 2020 as detailed in Note 22.

 

Impairment of associate and intangible assets

The Directors considered the carrying value of goodwill as at 31 December 2021 and determined the impairment, as detailed in Note 17 was required.

 

2020 Exceptional items

 

Share option and warrant charge

Ongoing charges related to options and warrants issued in connection to previous transactional and reorganisational events, the costs of which were treated as exceptional items at the time, continue to be classified as exceptional items in the year they are recognised. The Group uses the Black-Scholes model to value its share option and warrants, the charge for 2020 was £278,000.

 

Transactional and reorganisational costs

Transactional costs relate to various debt and equity raises completed during 2020 as well as costs associated with terminating the ESA as detailed in note 33.

 

Impairment of associate and intangible assets

The Directors considered the carrying value of goodwill, investments and the share of net assets of associates as at 31 December 2020 and determined the impairment, as detailed in Notes 16, 17 and 18 were required.

 

 

7.       Auditor's remuneration

 

	2021	2020
	£'000	£'000
Fees payable to the auditor, Moore Kingston Smith LLP, for the audit of the annual accounts of the Group and the Company	81	76
Taxation compliance	8	8
	89	84

 

8.       Employees

 

The average number of employees (including Directors not under employment contracts) during the year was:

	2021	2020
	No.	No.
Administration	5	5
Production	28	44
Sales	2	3
	35	52

 

The aggregate payroll costs (including Directors not under employment contracts) were:

	2021	2020
	£'000	£'000
Wages, salaries and fees	1,448	2,250
Social security costs	77	133
Pension costs	13	22
	1,538	2,405

 

Wages, salaries and fees are stated in this note 8 gross of £185,000 (2020: £425,000) received in accordance with the  Coronavirus Job Retention Scheme which is netted off in the Consolidated Statement of Comprehensive Income on page 40.

 

9.       Remuneration of Directors and key management personnel

 

In the opinion of the Board, only the Directors of the Company and the other members of the Executive Team, as detailed in the Corporate Governance Report, are regarded as key management personnel. The remuneration of key management personnel during 2021 was, in aggregate, £451,000 (2020: £508,000).

 

Directors' remuneration and fees, including Non-Executive Directors, during the year were as follows, (no pension contributions were made in either 2021 or 2020):

	2021	2020
	£'000	£'000
David Ciclitira	261	330
Bryan Lawrie	17	76
Serenella Ciclitira*	20	10
Ranjit Murugason*	107	20
Trudy Norris-Grey (resigned 14 February 2021)	15	52
Simon Horgan (resigned 17 February 2021)*	2	10
Mark Freebairn (resigned 14 February 2021)*	2	10
Stephan Birrell (appointed 27 July 2021)	27	-
	451	508

*In 2020 the Non-Executive Directors waived their fees for Q2 and Q3.

 

 

 

David Ciclitira	2021	2020
	£'000	£'000
UK Chairman's fees*	-	25
International consultancy fees	250	250
Additional contracted work during the year	11	55
	261	330

*In 2021 David Ciclitira voluntarily waived his Chairman's fees.

 

In the prior year David Ciclitira invoiced a further £178,000 for further additional contracted work which was subsequently paid but then waived by credit note. The balance is included in unpaid balances due to related parties at 31 December 2020. This was subsequently offset against the outstanding loan balance due to David Ciclitira in the current year.

 

Bryan Lawrie

	2021	2020
	£'000	£'000
Fees as Chief Financial Officer	-	71
Non-Executive fees	17	5
	17	76

Fees for the services of Bryan Lawrie as Chief Financial Officer were paid to CFO Partners Limited.

 

Ranjit Murugason

	2021	2020
	£'000	£'000
Temporary increase agreed in February 2021	67	-
Non-Executive fees	40	20
	107	20

 

Stephen Birrell

	2021	2020
	£'000	£'000
Consultancy fees	15	-
Non-Executive fees	12	-
	27	-

Fees for consultancy services provided by Stephen Birrell were paid to Ossian Energy Limited.

 

In April 2019 the Group adopted a share option scheme on 2 April 2019 for certain Directors and senior management. Options are generally exercisable at a price equal to the market price of the Plc shares on the day immediately prior to the date of the grant. Options are forfeited if the employee leaves the Group before the options vest.

 

As at 31 December 2021 the following outstanding share options were held by Directors and key management personnel. No options were issued to directors in 2020 or 2021.

 

	2021	2020
David Ciclitira	1,341,891	1,341,891
Bryan Lawrie	335,472	335,472
Serenella Ciclitira	-	-
Ranjit Murugason	-	-
Stephan Birrell (appointed 27 July 2021)	-	-
	1,677,363	1,677,363

 

Further information on share options are set out in Note 30.

 

Further information on related party transactions are set out in Note 32.

 

10.     Finance costs

 

	2021	2020
	£'000	£'000
Loan interest	65	59
Interest expense on lease liabilities	19	24
Other interest	24	27
	108	110

 

Included in loan interest is £22,000 (2020: £51,000) paid to David Ciclitira in accordance with the loan facility described in Note 22, see also Note 32.

 

11.     Taxation

	2021	2020
Current tax	£'000	£'000
UK Corporation tax in respect of current year:
Current taxation	-	-
Adjustments in respect of prior years	(56)	(238)
Total tax (credit) charge for the year	(56)	(238)
Deferred taxation
Original and reversal of timing differences	(87)	28
Effect of change in tax rates	204	66
Total deferred taxation charge	117	94
Tax charge on loss on ordinary activities	61	(144)

 

	2021	2020
	£'000	£'000
Loss on ordinary activities before tax	(3,316)	(8,377)
Loss on ordinary activities at the standard rate of corporation tax of 19% (2020: 19%)	(630)	(1,592)
Effect of disallowable expenditure	234	960
Tax losses (utilised)/carried forward	299	660
Effect of change in tax rates	204	66
Adjustment in respect of prior years	(56)	(238)
Effect of different tax rates applied in overseas jurisdictions	10	-
Total tax charge/(credit) for the year	61	(144)

 

12.     Earnings per share

 

The basic earnings per share is calculated by dividing the (loss)/profit attributable to equity shareholders by the weighted average number of shares in issue during the year. In calculating the diluted earnings per share, any outstanding share options, warrants and convertible loans are taken into account where the impact of these is dilutive.

 

	2021	2020
Loss for the year after tax (£'000)	(3,377)	(8,233)
Weighted average number of shares in issue	131,155,672	83,678,936
Basic and diluted earnings per share	(2.6p)	(9.8p)

 

Diluted earnings per share in both 2021 and 2020 are the same as basic earnings per share, as there are no dilutive options or warrants in issue during these years, the number of outstanding share options and warrants are detailed in Note 30.

 

 

13.     Property, plant and equipment

 

Group	Content		Other		Total
	2021	2020	2021	2020	2021	2020
	£'000	£'000	£'000	£'000	£'000	£'000
Cost
Cost at start of year	5,556	5,015	175	176	5,731	5,191
Additions for year	586	921	3	14	589	935
Disposals	-	(380)	-	(15)	-	(395)
Cost at end of year	6,142	5,556	178	175	6,320	5,731
Depreciation
Cumulative depreciation at start of year	1,487	970	100	69	1,587	1,039
Charge for year	754	705	47	46	801	751
Eliminated on disposal	-	(188)	-	(15)	-	(203)
Cumulative depreciation at end of year	2,241	1,487	147	100	2,388	1,587
Net book value at end of year	3,901	4,069	31	75	3,932	4,144
Net book value at start of year	4,069	4,045	75	107	4,144	4,152

 

The Company had no property, plant and equipment assets in either 2021 or 2020.

 

The Directors considered the carrying value at 31 December 2021 for each asset and it was determined that no impairment was required.

 

 

14.     Right of use Assets

 

Buildings	Group
	2021	2020
	£'000	£'000
Cost
Cost at start of year	308	308
Additions for year	-	-
Cost at end of year	308	308
Depreciation
Cumulative depreciation at start of year	77	16
Charge for year	62	61
Cumulative depreciation at end of year	139	77
Net book value at end of year	169	231
Net book value at start of year	231	292

The Company had no right of use assets in either 2021 or 2020.

 

15.     Intangible assets

 

	Group		Company
	2021	2020	2021	2020
	£'000	£'000	£'000	£'000
Cost
Cost at start of year	1,539	88	1,450	-
Additions for year	1	1,451	-	1,450
Cost at end of year	1,540	1,539	1,450	1,450
Amortisation
Cumulative amortisation at start of year	23	12	-	-
Charge for year	286	11	277	-
Cumulative amortisation at end of year	309	23	277	-
Net book value at end of year	1,231	1,516	1,173	1,450
Net book value at start of year	1,516	76	1,450	-

 

Trademarks

Trademarks are obtained for each show in each jurisdiction around the world. Trademarks are amortised over their estimated useful lives, which is on average 10 years. The carrying value of trademarks at 31 December 2021 is £59,000 (2020; £66,000).

 

LCSE

In December 2020 the Company formed a new Sports and Entertainment division ('LCSE') through the acquisition of the entire issued share capital of Live Company Sports and Entertainment Limited together with its wholly owned subsidiary Live Company Sports and Entertainment (Pty) Limited and 50% interest in K-Pop Europa Limited for £650,000. Prior to the acquisition  Live Company Sports and Entertainment Limited was 100% owned by David Ciclitira.

 

The Company also purchased certain contracts from World Sport South Africa (Pty) Limited for £500,000 and acquired the entire issued share capital of E Movement Holdings Ltd for £300,000. Prior to the acquisition E Movement Holdings Ltd was 33.34% owned by David Ciclitira.

 

The substance of these transactions being the acquisition of a series of contracts rather than a business combination as defined in IFRS 3 'Business Combinations'. The acquired contracts are amortised over the period of the rights acquired, where contracts are renewable and are likely to be renewed for a further period such further period, but no subsequent periods, is considered to be part of the period of the rights acquired. The carrying value of these contracts at 31 December 2021 is £1,172,000 (2020; £1,450,000).

 

2020 Acquisitions					Purchase price
					£'000
Live Company Sports and Entertainment Limited					650
Live Company Sports and Entertainment Pty Limited					-
K-Pop Europa Limited (50%)					-
Novation of contracts					500
E Movement Holdings Ltd					300
					1,450
Satisfied by:
Cash					50
Deferred consideration					800
Equity instruments (6,000,000 Ordinary shares of parent Company)					600
					1,450

 

As detailed in Note 27 5,500,000 Ordinary shares of the Company representing £550,000 of the deferred consideration were issued in May 2021; a further 1,142,858 Ordinary shares of the Company representing a further £40,000 of the deferred consideration were issued in December 2021, which together with cash payments of £25,000 in March 2021 and £25,000 in April 2021 left £160,000 of deferred consideration outstanding at 31 December 2021.

 

In March 2022 £45,000 of the outstanding deferred consideration due to David Ciclitira was settled in cash, leaving £105,000 of deferred consideration outstanding of which £55,000 is due to David Ciclitira.

 

The Directors considered the carrying value at 31 December 2021 for each intangible asset and it was determined that no impairment was required.

 

 

16.     Investments

 

	Group		Company
	2021	2020	2021	2020
	£'000	£'000	£'000	£'000
Cost
Cost at start of the year	-	-	17,450	17,450
Additions for the year	1,113	-	1,113	-
Cost at end of year	1,113	-	18,563	17,450
Impairment
At start of the year	-	-	11,425	-
Impairment in the year	-	-	116	11,425
Reversal of prior year impairment	-	-	(3,816)	-
Cumulative impairment at end of year	-	-	7,725	11,425
Net book value at end of the year	1,113	-	10,838	6,025
Net book value at start of year	-	-	7,725	17,450

 

 

 

 

Cash generating units

The Directors considered the carrying value at 31 December 2021 for each cash generating unit, identified below, based on a detailed budget and forecast, discounted over five years at the Groups current cost of capital, considered by the Directors to be 9%, and it was determined the impairment, and reversal of prior impairment, as described in the table below, was required.

 

	At start of year	Additions	(Impairment) /reversal of	At end of year
	£'000	£'000	£'000	£'000
Brick Live Far East Limited	-	-	-	-
Brick Live Group (incorporating Bright Bricks Limited)	5,025	-	3,816	8,841
Parallel Live Group	1,000	-	(116)	884
	6,025	-	3,700	9,725

 

Financial assets

The Directors considered the carrying value at 31 December 2021 for each investment, identified below, and it was determined that no further impairment was required.

	At start of year	Additions	Impairment	At end of year
	£'000	£'000	£'000	£'000
Start Art Global Ltd	-	1,000	-	1,000
E-Movement (PTY) Ltd	-	113	-	113
	-	1,113	-	1,113

 

In May 2021 the Company subscribed to 389 ordinary shares in Start Art Global Limited. ('StART.Art'), representing a non-controlling stake of 18.6% of the total issued share capital of the company, for a total consideration of £1,000,000. Prior to the transaction StART.Art was 100% owned by David Ciclitira and Ranjit Murugason as detailed in Note 32.

 

In November 2021 StART.Art acquired the entire issued share capital of Start (2013) Limited, the promoter of the StART Art Fair, in an all share transaction, resulting in a decrease in the Company's interest in the enlarged group from 18.6% to 14.6% with no diminution of value. Prior to the acquisition Start (2013) Limited was 100% owned by David Ciclitira and Ranjit Murugason as detailed in Note 32. In December 2021 StART.Art issued a further 180 ordinary shares to LVCG for nominal consideration increasing LVCG's holding to 19.9%.

 

There being no active market for shares in StART.Art the carrying value has been assessed with reference to a DCF model prepared by the management of StART.Art and reviewed by the directors of LVCG. The valuation has also been reviewed by a third party independent valuer.

 

In November 2021 the Company purchased 271 ordinary shares, representing 20% of the total issued share capital, in E-Movement (PTY) Limited ('EMPL') from David Ciclitira for a total consideration of £113,460. These shares were originally purchased by David Ciclitira (acting in his personal capacity) for the same amount in anticipation of them being transferred to the Company. EMPL is the South African based promoter of the Cape Town E Prix which has been confirmed for Series 9 of the ABB FIA Formula E World Championship and due to take place in February 2023.

 

These transactions have been treated as the acquisition of investments as detailed in Note 2.8.

 

			Purchase price
			£'000
Start Art Global Limited			1,000
E-Movement (PTY) Limited			113
			1,113
Satisfied by:
Cash			1,113
			1,113

 

 

17.     Goodwill

 

	Group		Company
	2021	2020	2021	2020
	£'000	£'000	£'000	£'000
Cost at start and end of year	8,888	8,888	-	-
Impairment
At start of the year	7,992	4,581	-	-
Impairment in the year	12	3,411	-	-
Cumulative impairment at end of year	8,004	7,992	-	-
Net book value at end of year	884	896	-	-
Net book value at start of year	896	4,307	-	-

 

 

Cash generating units

The Directors considered the carrying value at 31 December 2021 for each cash generating unit, identified below, based on a detailed budget and forecast, discounted over five years at the Groups current cost of capital, considered by the Directors to be 9%, and it was determined the impairment, as described in the table below, was required.

 

	At start of year	Additions	(Impairment)	At end of year
	£'000	£'000	£'000	£'000
Brick Live Far East Limited	-	-	-	-
Brick Live Group (incorporating Bright Bricks Limited)	-	-	-	-
Parallel Live Group	896	-	(12)	884
	896	-	(12)	884

 

18.     Investments in Associates and Joint Ventures

 

	Group			Company
	2021	2020	2021		2020
	£'000	£'000	£'000		£'000
Cost
Cost at start of year	197	197	-		-
Additions in the year	-	-	-		-
Cost at end of year	197	197	-		-
Impairment
At start of year	197	111	-		-
Impairment in the year	-	86	-		-
At end of year	197	197	-		-
Net book value at end of year	-	-	-		-
Net book value at start of year	-	86	-		-

 

Brick Live Centre Education Development (Beijing) Company Ltd ('BLCED')

In July 2017, BLFE entered into a long-term agreement with Fortune Access, to create a limited liability foreign enterprise company in China called Brick Live Centre Education Development (Beijing) Company Limited. BLFE agreed to invest 980,000 RMB (approximately £111,000) for a 49% shareholding. Based on the performance in the year ended 31 December 2020 the investment in the associate was impaired to £nil.

 

The Group accounts for the associate under the equity method of accounting.

 

The results of BLCED in the year are:	2021	2020
	£'000	£'000
Revenue	473	128
Loss before tax	(468)	(500)
Taxation	-	-
Loss after tax	(468)	(500)
Current assets	380	287
Non-current assets	490	693
Current liabilities	(1,205)	(912)
Non-current liabilities	(64)	-
	(400)	68

In August 2021 Fortune Access injected a further 516,000 RMB (approximately £65,000).

 

BLCED losses have been recognised through the Consolidated Statement of Comprehensive Income to the extent that they do not exceed the Group's initial investment in BLCED together with the Group's share of its accumulated profits. The Group's unrecognised share of BLCED's loss for the year to 31 December 2021 is £168,000. The Groups unrecognised share of BLCED's cumulative loss is £118,000.

 

Parallel Three Six Zero Inc ('PTSZ')

In September 2018, Parallel Live Group signed a joint venture agreement with US-based company Three Six Zero, forming the new company Parallel Three Six Zero Inc. It has been granted exclusive rights by Parallel Live Group to promote BRICKLIVE events in North America and Canada with Brick Live International Limited as its content provider.

 

There were no BRICKLIVE events in North America operated by PTSZ in 2021 or 2020.

 

The Group accounts for the joint venture under the equity method of accounting.

 

The results of the PTSZ in the year are:
	2021	2020
	£'000	£'000
Revenue	-	-
Loss before tax	-	(1)
Taxation	-	-
Loss after tax	-	(1)
Current assets	-	-
Non-current assets	-	-
Current liabilities	(27)	(27)
Non-current liabilities	-	-
	(27)	(27)

 

19.     Inventories

 

	Group		Company
	2021	2020	2021	2020
	£'000	£'000	£'000	£'000
Inventories of bricks	3,742	4,633	-	-
Work in progress	63	198	-	-
	3,805	4,831	-	-

 

 

Included in inventories is £3,097,000 (2020: £3,983,000) of stock acquired on acquisition of Bright Bricks Group and included at fair value at that date.

 

Included in inventories is £1,500,000 (2020: £1,500,000) subject to a sale and HP Agreement entered into with Close Leasing Limited, (see Note 22).

 

The Directors considered the carrying value at 31 December 2021 for inventories and it was determined that no impairment was required.

 

20.     Trade and other receivables

 

	Group		Company
	2021	2020	2021	2020
	£'000	£'000	£'000	£'000
Trade receivables	231	123	2	-
Amounts owed by subsidiaries (note 34)	41	-	1,155	1,226
Other receivables	57	64	50	78
Prepayments and accrued income	183	217	123	156
	512	404	1,330	1,460

 

Amounts owed by subsidiaries are unsecured, interest free and repayable on demand.

 

21.     Cash and cash equivalents

 

	Group		Company
	2021	2020	2021	2020
	£'000	£'000	£'000	£'000
Cash at bank	211	168	-	191

 

22.     Borrowings

 

	Group		Company
	2021	2020	2021	2020
	£'000	£'000	£'000	£'000
Loan due within one year	477	615	56	167
Loan due after one year	1,201	1,430	185	83
	1,678	2,045	241	250

 

In April 2020 the Company entered into a £250,000 CBILS loan agreement with NatWest Bank Plc of which £240,740 remained outstanding at the balance sheet date. The loan is unsecured, for a term of six years with an effective interest rate of 4.08%.

 

In April 2020 the Group entered into a £500,000 loan agreement with David Ciclitira of which £90,823 remained outstanding at the balance sheet date. The loan from David Ciclitira bears interest at 16.2% and is secured by a second fixed and floating charge over the Groups assets with priority given to the security held by Close Leasing Limited as detailed below. In March 2022 the outstanding balance was repaid in full.

 

In August 2020 the Group entered into an agreement with Close Leasing Limited whereby stock totalling £1,500,000 included under Inventories in the Statement of Financial Position in these condensed consolidated financial statements was sold to Close Leasing Limited and purchased back under the terms of a £1,500,000 Hire Purchase Facility (HP Agreement) provided in conjunction with the CBILS, of which £1,346,504 remained outstanding at the balance sheet date. The HP Agreement was for a term of five years at an effective interest rate of 5.14% secured against the £1,500,000 of stock subject to the agreement and a fixed and floating charge over the Groups other assets.

 

23.     Trade and other payables

 

	Group		Company
	2021	2020	2021	2020
	£'000	£'000	£'000	£'000
Trade payables	1,098	574	533	112
Amounts owed to subsidiaries	-	-	217	66
Other payables	275	866	188	835
Other taxation and social security	1,265	924	32	24
Accruals and deferred income	1,170	1,120	336	343
	3,808	3,484	1,306	1,380

 

Amounts owed to subsidiaries are unsecured, interest free and repayable on demand.

 

Other payables include £160,000 (2020: £800,000) of deferred consideration as detailed in Note 15.

 

24.     Financial risks

 

The Group and Company operations expose them to a number of financial risks. The Directors aim to protect the Group and Company against the potential adverse effects of these financial risks.

 

Financial assets

Financial assets include cash and trade and other receivables, excluding prepayments.

 

These amounts, where appropriate, have been shown separately on the face of the Statement of Financial Position. Funds not immediately required for the Group and Company's operations are invested in bank deposits. It is the Directors' opinion that the carrying values of cash, trade receivables and investments approximate to their fair values.

 

Financial liabilities

Financial liabilities include current and non-current borrowings and trade and other payables (excluding taxation and social security and deferred income).

 

All amounts are carried at amortised cost. These amounts have been disclosed in the notes to the financial statements. It is the Directors' opinion that the carrying values of financial liabilities approximate to their fair-value.

 

Liquidity risk

The Group and Company's surplus liquid resources are maintained on short-term interest-bearing deposits. The Group and Company plans to continue to meet operating and other loan commitments as they fall due. Liquidity risk is managed through cash flow forecasts and regular planning.

 

Set out below are liquidity risk comparative tables as at 31 December 2021 and 31 December 2020.

 

Remaining contractual maturities year ended 31 December 2021
Group	Within 3 months	> 3 months < 1 year		> one year < 5 years		Total carrying amount
	£'000	£'000		£'000		£'000
Bank loans and borrowings	185	292		1,201		1,678
Trade and other payables	1,373	-		-		1,373
Lease liabilities	16	50		122		188
	1,574	342		1,323		3,239
Company	Within 3 months		> 3 months < 1 year		> one year < 5 years		Total carrying amount
	£'000		£'000		£'000		£'000
Bank loans and borrowings	14		42		185		241
Trade and other payables	938		-		-		938
	952		42		185		1,179
Remaining contractual maturities year ended 31 December 2020
Group	Within 3 months	> 3 months < 1 year		> one year < 5 years		Total carrying amount
	£'000	£'000		£'000		£'000
Bank loans and borrowings	8	607		1,430		2,045
Trade and other payables	1,440	-		-		1,440
Lease liabilities	15	45		188		248
	1,463	652		1,618		3,733
Company	Within 3 months		> 3 months < 1 year		> one year < 5 years		Total carrying amount
	£'000		£'000		£'000		£'000
Bank loans and borrowings	-		167		83		250
Trade and other payables	1,013		-		-		1,013
	1,013		167		83		1,263

 

Trade and other payables above exclude taxation and accruals and deferred income.

 

Credit risk

Financial assets past due but not impaired as at 31 December 2021:

 

	Not impaired and not past due	Not impaired but past due by the following amounts
		>30 days	>60 days	>90 days	>120 days
	£'000	£'000	£'000	£'000	£'000
Group: Trade and other receivables	269	14	8	16	22
Company: Trade and other receivables	1,207	-	-	-	-

 

Financial assets past due but not impaired as at 31 December 2020:

 

	Not impaired and not past due	Not impaired but past due by the following amounts
		>30 days	>60 days	>90 days	>120 days
	£'000	£'000	£'000	£'000	£'000
Group: Trade and other receivables	113	25	-	-	49
Company: Trade and other receivables	1,304	-	-	-	-

 

Trade and other receivables above exclude prepayments and accrued income.

 

The Group is exposed to credit risk on its cash and cash equivalents, trade and other receivables. The maximum exposure to credit risk is represented by the carrying value of each financial asset.

 

Credit risk with respect to cash is reduced through maintaining banking relationships with established financial intermediaries with acceptable credit ratings. Bank deposits as at 31 December 2021 were £211,000 (2020: £168,000), all of which are considered of low credit risk.

 

Credit risk with respect trade and other receivables Is reduced through assessing all material new clients for credit risk prior to entering into a contractual relationship. All trade and other receivables are assessed regularly for credit risk and those which are past due by 90 days or more and where there has been a breakdown of communication with the client such that there is no longer confidence that the sum will be collectable are impaired to the extend they are no longer expected to be colectable.

 

Group trade and other receivables excluding prepayments and accrued income as at 31 December 2021 were £287,000 (2020: £187,000), all of which are collected and/or collectable and are considered of low credit risk.

 

 

 

 

Market risk

a.   Interest rate risk

The Group had two outstanding interest bearing loans (one with NatWest Bank PLC and one with David Ciclitira) and the HP Agreement with Close Leasing Limited at the year end.The interest rates in respect of the HP Agreement and loan from David Ciclitira are fixed and in respect of the loan from NatWest Bank PLC is calculated in relation to bank Base Rate, there are no early redemption penalties associated with the NatWest Bank PLC loan and the risk is therefore considered to be insignificant.

 

b.   Foreign currency risk

Although the Company is based in the United Kingdom, a significant part of the Group's and Company's operations are overseas, and the operating or functional currency of a large part of the global business is in US Dollars, Euros and South African Rand. As a result, the Group's sterling accounts can be affected by movements in the US Dollar/Sterling, the Euro/Sterling and the South African Rand/Sterling exchange rates.

 

The foreign assets and liabilities of the Group and Company are closely matched as at 31 December 2021. The table below sets out the carrying amounts of assets and liabilities for the Group in their presentational currency (i.e. Sterling) and a total impact for each 10% fluctuation in exchange rates. Based on the carrying amounts of foreign assets and liabilities as at 31 December 2021, for each 10% fluctuation in exchange rates, net assets are expected to be impacted by £11,000 (2020: £16,000).

 

Year ended 31 December 2021
Carrying amount (sterling equivalent)						Forex Risk
	£	$	€	R	Total	(-10%)	10%
	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Financial assets
Cash	(36)	1	-	246	211	25	(25)
Trade and other receivables	390	14	12	96	512	12	(12)
	354	15	12	342	723	37	(37)
Financial liabilities
Borrowings	1,678	-	-	-	1,678	-	-
Trade payables	836	88	101	73	1,098	26	(26)
Other payables	275	-	-	-	275	-	-
Lease liabilities	188	-	-	-	188	-	-
Other taxation and social security	1,265	-	-	-	1,265	-	-
Accruals and deferred income	1,170	-	-	-	1,170	-	-
	5,412	88	101	73	5,674	26	(26)
Net Impact						(11)	11

 

 

Year ended 31 December 2020
Carrying amount (sterling equivalent)						Forex Risk
	£	$	€	R	Total	(-10%)	10%
	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Financial assets
Cash	164	3	1	-	168	-	-
Trade and other receivables	331	27	46	-	404	7	(7)
	495	30	47	-	572	7	(7)
Financial liabilities
Borrowings	2,045	-	-	-	2,045	-	-
Trade payables	349	67	158	-	574	23	(23)
Other payables	866	-	-	-	866	-	-
Lease liabilities	248	-	-	-	248	-	-
Other taxation and social security	924	-	-	-	924	-	-
Accruals and deferred income	1,120	-	-	-	1,120	-	-
	5,552	67	158	-	5,777	23	(23)
Net Impact						16	(16)

 

25.     Lease liabilities

 

	Group		Company
	2021	2020	2021	2020
	£'000	£'000	£'000	£'000
Current	66	60	-	-
Non-current	122	188	-	-
	188	248	-	-

 

In 2019, a right of use asset, being the present value of the operating lease payments over the remaining life of the lease, was recognised. The right of use assets and corresponding lease liability have been calculated using a discount rate of 9%. The depreciation of the assets and interest charge are recognised in the Statement of Comprehensive Income in the year and the buildings maturity analysis of lease commitments at 31 December 2021 is detailed below.

 

Lease payments relate to leases of property. The Group does not have an option to purchase the leased property at the expiry of the lease period.

 

Payments recognised as an expense	2021	2020
	£'000	£'000
Minimum lease payments	-	-
Lease depreciation	62	61
Interest	19	24

 

Non-cancellable lease commitments	2021	2020
	£'000	£'000
Not later than 1 year	66	79
Later than 1 year and not later than 5 years	122	219
Later than 5 years	-	-
	188	298

 

 

26.     Deferred tax

 

	2021	2020
	£'000	£'000
At start of year	644	550
Charged to profit or loss	117	94
At end of year	761	644

 

Due to the availability of UK tax losses, subject to agreement with the HMRC, there is an estimated deferred tax asset of £2,944,000 (2020: £2,648,000). This is not recognised due to the uncertainty of the timing of future taxable profits against which these losses could be utilised.

 

27.     Share capital

 

The issued share capital is set out in the table below:

 

	2021		2020
	No. of shares	£'000	No. of shares	£'000
Issued and fully paid
Ordinary shares of 1p	159,802,147	1,598	108,138,544	1,081
Deferred shares of 51.8p	2,047,523	1,061	2,047,523	1,061
Deferred Ordinary shares of 0.5p	199,831,545	999	199,831,545	999
Deferred B shares of £19.60	103,260	2,024	103,260	2,024
Total		5,682		5,165

 

The changes in the year to 1p Ordinary shares, relating to the various capital transactions during the year were as follows:

 

	2021
Ordinary shares of 1p	No. of shares	£'000
At start of year	108,138,544	1,081
Settlement of supplier and contractor fees (RNS Number : 4882P 17 February 2021)	1,863,219	19
Share placing, settlement of deferred consideration and contractor fees (RNS Number : 3348X 04 May 2021)	36,000,000	360
Loan conversion and settlement of contractor fees (RNS Number : 1210F 14 July 2021)	1,114,668	11
Share placing, settlement of deferred consideration and contractor fees (RNS Number : 9667V 17 December 2021)	12,685,716	127
At end of year	159,802,147	1,598

 

 

	2020
Ordinary shares of 1p	No. of shares	£'000
At start of year	79,500,419	794
Settlement of director fees (RNS Number : 1029A 17 January 2020)	116,667	1
Settlement of advisor fees (RNS Number : 6990J 15 April 2020)	233,333	2
Settlement of salary and contractor fees (RNS Number : 9396L 05 May 2020)	1,196,866	12
Share Placing (RNS Number : 1520R 26 June 2020)	4,000,000	40
Loan conversion (RNS Number : 1520R 26 June 2020)	2,050,000	21
Settlement of salary and contractor fees (RNS Number : 5485T 21 July 2020)	835,182	8
Settlement of salary and contractor fees (RNS Number : 9339Z 24 September 2020)	1,396,077	14
Share placing and subscription (RNS Number : 3562H 03 December 2020)	18,810,000	189
At end of year	108,138,544	1,081

 

 

The number of additional shares authorised for issue is 60,314,284 (2020: 30,104,523).

 

Deferred shares

The Company has 2,047,523 Deferred shares of 51.8p each and 199,831,545 Deferred Ordinary shares of 0.5p each (together the 'Deferred shares') in issue. The Company also has 103,260 Deferred B shares in issue.

 

The Deferred shares have the following rights and restrictions. They shall:

a.   Not entitle their holders to receive any dividend or other distribution;

b.   Not entitle their holders to receive notice of or to attend, speak or vote at any General Meeting of the Company by virtue of or in respect of their holding of such Deferred shares; and

c.   Entitle their holders on a return of assets on a winding-up of the Company or otherwise only to the repayment of the capital paid up on such Deferred shares and only after repayment of the capital paid up on each Ordinary share in the capital of the Company and the payment of a further £100,000 on each such Ordinary share.

 

The holders of the Deferred shares shall not be entitled to any further participation in the assets or profits of the Company. Notwithstanding any other provision of these Articles and unless specifically required by the provisions of the Act, the Company shall not be required to issue any certificates in respect of the Deferred shares. The Company shall have irrevocable authority at any time:

a.   to appoint a person on behalf of any holder of Deferred shares to enter into an agreement to transfer, and to execute a transfer of, the Deferred shares, for no consideration, to such person (whether or not an officer of the Company) as the Directors may determine as the custodian thereof;

b.   to purchase all the Deferred shares then in issue in consideration of an aggregate payment of one penny for all of such shares then redeemed and upon giving 28 days' prior notice to the holders of Deferred shares as to be redeemed fixing a time and place for redemption; and

c.   in the event of any transfer, purchase or redemption to retain any share certificate relating to such shares. If any Deferred shares are purchased or redeemed as aforesaid, the relevant amount of authorised but unissued share capital arising may be redesignated by the Directors as Ordinary share capital.

 

Neither the passing by the Company of any special resolution for the cancellation of the Deferred shares for no consideration by means of a reduction of capital requiring the confirmation of the Court nor the obtaining by the Company nor the making by the Court of any Order confirming any such 103 reduction of capital nor the becoming effective of any such Order shall constitute a variation, modification or abrogation of the rights attaching to the Deferred shares and accordingly the Deferred shares may at any time be cancelled for no consideration by means of a reduction of capital effected in accordance with the Act without sanction or consent on the part of the holders of the Deferred shares.

 

28.     Share premium

 

	2021	2020
	£'000	£'000
At start of year	25,004	23,480
Premium arising on issue of equity shares	1,486	840
Shares issued on acquisition of subsidiary and novation of contracts	-	135
Debt to share conversion	644	634
Share issue costs	(110)	(85)
At end of year	27,024	25,004

 

29.     Acquisitions

 

There were no acquisitions in 2021.

 

30.     Share options and warrants

 

Share option reserve

	2021	2020
	£'000	£'000
At start of year	496	218
Share option charge	223	222
Share options forfeited	(267)	-
Warrant charge	63	56
At end of year	515	496

 

Share options

The Group adopted a share option scheme on 2 April 2019 for certain directors and senior management. Options are generally exercisable at a price equal to the market price of the Plc shares on the day immediately prior to the date of the grant. Options are forfeited if the employee leaves the Group before the options vest.

 

The Share Option Plan provides for the grant of both tax-approved Enterprise Management Incentives (EMI) Options and unapproved options.

 

No options were issued in 2020 or 2021.

 

The charge for the year ended 31 December 2021 for the options issued in April 2019 totals £223,000 (2020: £222,000).

 

Details of the share options outstanding during the year are as follows.

 

	2021				2020
	Number		Weighted average exercise price (p)		Number	Weighted average exercise price (p)
Outstanding at the beginning of the year	3,086,346	65		3,086,346		65
Granted during the year	-	-		-		-
Forfeited during the year	(1,341,889)	65		-		-
Exercised during the year	-	-		-		-
Outstanding at the end of the year	1,744,457	65		3,086,346		65

 

Options become exercisable on the third anniversary of the grant date and lapse on the tenth anniversary of the grant date. All options currently outstanding were granted on 2 April 2019.

 

Advisor and creditor warrants

1,500,000 (2020: 75,000) advisor warrants were issued during the year at a weighted average exercise price of 5p (2020: 15p).

 

The inputs into the warrant pricing model for the warrants issued in the year are:

Weighted average exercise price           5p

Expected volatility                                  77%

Expected life                                           2 years

Risk free interest rate                             1.1%

Expected dividends                                0.00

 

The charge for the year ended 31 December 2021 for the advisor and creditor warrants in issue totals £63,000 (2020: £56,000).

 

A total of 2,213,941 advisor and creditor warrants were outstanding at 31 December 2021 (2020: 713,941).

 

Investor warrants

11,428,572 (2020: 16,810,000) investor warrants were issued to investors as part of an equity raise and are therefore outside the scope of IFRS 2 'Share-based payment' and consequently there is no share-based payment charge in respect of these warrants.

 

During the year 3,903,840 (2020: nil) investor warrants expired leaving a total of 28,238,572 investor warrants outstanding at 31 December 2021 (2020: 20,713,840).

 

Details of all warrants outstanding during the year are as follows.

 

 

	31 December 2021			31 December 2020
		Number	Price (p)	Number	Price (p)
Investor (exercisable up to 25 February 2021)		-	-	3,903,840	80.00
Adviser (exercisable up to 25 February 2022)*		50,000	15.00	50,000	80.00
Investor (exercisable up to 25 June 2022)**		4,000,000	10.00	4,000,000	15.00
Adviser (exercisable up to 25 June 2022)**		75,000	10.00	75,000	15.00
Creditor (exercisable up to 17 October 2022)		356,923	38.79	356,923	38.79
Investor (exercisable up to 3 December 2022)		12,810,000	10.00	12,810,000	10.00
Creditor (exercisable up to 16 December 2022)		232,018	38.79	232,018	38.79
Adviser (exercisable up to 24 May 2023)		1,500,000	5.00	-	-
Investor (exercisable up to 23 December 2023)		11,428,572	5.00	-	-
		30,452,513	8.44	21,427,781	24.66

 

*repriced from 80p to 15p in May 2021.

**repriced from 15p to 10p in May 2021.

 

 

 

	2021				2020
Warrants	Number		Weighted average exercise price (p)		Number	Weighted average exercise price (p)
Outstanding at the beginning of the year	21,427,781	24.66		4,542,781		74.66
Issued during the year	12,928,572	5.00		16,885,000		11.21
Expired during the year	(3,903,840)	15.00		-		-
Exercised during the year	-	-		-		-
Outstanding at the end of the year	30,452,513	8.44		21,427,781		24.66

 

 

31.     Capital management

 

The Group's objectives when managing capital are to safeguard the Group's ability to continue as a going concern, so that it can continue to provide returns to shareholders and benefits for other stakeholders. The Group had net assets of £5.4m at 31 December 2021 (2020: £5.8m). The Group's capital management strategy is to retain sufficient working capital for day to day operating requirements and to ensure sufficient funding is available to meet commitments as they fall due and to support growth. There are no externally imposed capital requirements.

 

	2021	2020
	£'000	£'000
Loan facility	(1,678)	(2,045)
Total debt	(1,678)	(2,045)
Cash	211	168
Net debt	(1,467)	(1,877)

 

In order to maintain or adjust the capital structure the Group may issue new shares or sell assets to reduce debt.

 

32.     Related party transactions

 

Details of the Directors' remuneration and consultancy fees are disclosed in Note 9.

 

David Ciclitira

 

David Ciclitira injected funds into the Company during the year as follows:	2021	2020
	£'000	£'000
Fees settled in shares	-	28
Loan converted to equity	30	205
Acquisition of LCSE settled in shares	200	450
	230	683
Loan advanced
Loan facility	-	500
Total funds injected	230	1,183

 

David Ciclitira received payments during the year as set out below:	2021	2020
	£'000	£'000
Business expenses and healthcare costs.	14	13
Rental arrangements for use of Venturi Formula E Car as described in Note 33 to the annual report for the year ended 31 December 2019	-	17
Fees and interest at 16.2% in relation to the provision of loan facility detailed in Note 22.	22	101
Fees in relation to HP Agreement guarantee	21	28
Consideration for the purchase of share in EMPL	113	-
Consideration for the purchase of LCSE, settled in shares	200	450
Fee in relation to the assumption of historic liabilities	-	29
	370	638
Loan repaid
Loan converted to equity	30	205
Loan repaid	174	-
	204	205
Total payments received	574	843

 

Unpaid balances due to related parties at 31 December	2021	2020
	£'000	£'000
David Ciclitira*	205	318
Serenella Ciclitira	28	8
Ranjit Murugason**	127	20
Bryan Lawrie**	24	11
Trudy Norris-Grey	-	(15)
Mark Freebairn	-	10
Simon Horgan	-	10
Stephen Birrell**	16	-
	400	362

 

*Includes total deferred consideration of £100,000 (2020: £300,000) in relation to the acquisition of David Ciclitira's interest in EMHL, and the outstanding loan balance of £90,823 (2020: £295,000) as detailed in Note 22. In March 2022 the outstanding loan balance was repaid in full together with £45,000 of the outstanding deferred consideration relating to the acquisition of EMHL leaving £55,000 outstanding.

 

**In February 2022 6,223,859 new Ordinary shares in the Company were issued  in settlement of outstanding Director's fees. Senior Director Ranjit Murugason received 5,047,620 Ordinary shares at 3.5p, Bryan Lawrie received 747,667 Ordinary shares at 3.5p and Stephen Birrell received 428,572 shares at 3.5p price.

 

Subsidiary undertakings and associates

 

During the year the Company provided and received services to other Group companies totalling:

 

Services provided by the Company to:	2021	2020
	£'000	£'000
Brick Live International Limited	90	-
	90	-
Services received by the Company from:
Brick Live International Limited	102	-
	102	-

 

Unpaid balances due to subsidiary undertakings and associates	2021	2020
	£'000	£'000
Brick Live Group Limited	65	66
Bright Bricks Limited	(521)	(943)
Brick Live International Limited	(593)	(283)
K-Pop Europa Limited	(41)	-
Live Company Group EBT Limited	152	-
	(938)	(1,160)

 

Investments

 

In May 2021 the Company subscribed to 389 ordinary shares in Start Art Global Limited. ('StART.Art'), representing a non-controlling stake of 18.6% of the total issued share capital of the company, for a total consideration of £1,000,000. Prior to the transaction StART.Art was 100% owned by David Ciclitira and Ranjit Murugason who are both directors of the Company.

 

In November 2021 StART.Art acquired the entire issued share capital of Start (2013) Limited, the promoter of the StART Art Fair, in an all share transaction, resulting in a decrease in the Company's interest in the enlarged group from 18.6% to 14.6% with no diminution of value. Prior to the acquisition Start (2013) Limited was 100% owned by David Ciclitira and Ranjit Murugason who are both directors of the Company.

 

In December 2021, following a reorganisation of the capital structure of StART.Art, StART.Art issued a further 180 ordinary shares to LVCG for nominal consideration increasing LVCG's holding to 19.9%.

 

In November 2021 the Company purchased 271 ordinary shares, representing 20% of the total issued share capital, in E-Movement (PTY) Limited ('EMPL') from David Ciclitira for a total consideration of £113,460. These shares were originally purchased by David Ciclitira (acting in his personal capacity) for the same amount in anticipation of them being transferred to the Company.

 

33.     Equity Share Arrangement

 

In December 2019, the Company entered into a subscription agreement with YA II PN, Limited. ('YA II') and RiverFort Global Opportunities PCC Limited ('RiverFort') together the 'Investors' whereby the Investors agreed to make an equity investment of £2m, before expenses ,through the subscription for, and issue of 6,666,667 new Ordinary shares of 1 pence each in the capital of the Company at a price of 30p per share. Under an equity sharing agreement also entered into by the Company with the Investors (the 'ESA'), an amount equal to the gross proceeds of the Subscription following its completion, will then be returned by the Company to the Investors (the 'ESA Payment'), with the Company to receive back the ESA Payment, subject to certain pricing adjustments on a pro rata monthly basis.

 

In August 2020 the Group entered into a £1,500,000 CBILS borrowing agreement with Close Leasing Limited, the proceeds from the facility were used to repay the outstanding YA II and RiverFort borrowing and to terminate the ESA agreement.

 

In addition to an early termination fee of £143,000 payable by the Group, Live Company Group EBT Limited purchased 5,726,480 shares previously held by YA II and RiverFort (representing 6.51%. of the Company's issued share capital at the time) into trust, at a cost of £57,000.

 

These payments together with the Group's expected share of the ESA Payment (£2,000,000 at the time of the agreement and included in non-current receivables in the Groups consolidated statement of financial position at 31 December 2019) which following the termination will no longer be receivable will be considered part of the consideration for the share purchase at a group level and is included in the Group retained earnings in the Consolidated Statement of Financial Position.

 

34.     Subsidiaries

 

At 31 December 2021, the Company had the following (direct and indirect) subsidiaries:

 

Held directly	Company number	Place of incorporation	% owned	Principal activities
Brick Live Group Limited	10151705	UK	100%	Holding Company
Bright Bricks Limited	07227540	UK	100%	Specialist production company
Bright Bricks 2020 Limited	12333294	UK	100%	Dormant
Live Company Group EBT Limited	12792192	UK	100%	Employee Benefit Trust Company
Parallel Live Group Limited	09932658	UK	100%	Holding Company
Live Company Sports and Entertainment Limited	12328268	UK	100%	Holding Company
E Movement Holdings Limited	12502990	UK	100%	Holding Company
Championship (Singapore) Pte Limited	201427355K	Singapore	95%	Dormant
Held indirectly
Brick Live International Limited	10257756	UK	100%	BRICKLIVE events
Brick Live Far East Limited	10308158	UK	100%	Dormant
Brick Live Far East Limited	2460460	Hong Kong	100%	Owner of Associate investment in China
Parallel Live (NY) LLC	6339763	USA	100%	Dormant
Live Company Sports and Entertainment (Pty) Limited	2020/765082/07	South Africa	100%	Sports and entertainment events
K-Pop Europa Limited	12924203	UK	50%	KPOP events
E Movement Holdings (Pty) Limited	2021/354354/07	South Africa	100%	Formula E events

 

In December 2020, the Company acquired the entire issued share capital of Live Company Sports and Entertainment Limited including its 50% interest in K-Pop Europa Limited (KPE).

 

At the time of acquisition the Directors concluded, by virtue of David Ciclitira being the sole director of KPE and was thus able to direct its activities, that KPE should be consolidated as a subsidiary in accordance with IFRS 10. The directors continued to assess signifiers of control during the year ended 31 December 2021 and concluded that the criteria for consolidation continued throughout the year.

 

During the year KPE made a pre tax loss of £8,000; and at 31 December KPE had net liabilities of £8,000. The results of KPE have not been consolidated in these financial statements on the basis of immateriality.

 

 The following subsidiaries were dissolved in the year:

 

Held directly	Company number	Place of incorporation	% owned	Principal activities
Brick Live Touring Limited	11253539	UK	100%	Dissolved
Held indirectly
Bright Bricks Consumer Limited	10653625	UK	100%	Dissolved

 

Brick Live Far East Limited is in the process of being dissolved.

 

The registered office of the subsidiaries incorporated is England and Wales is 3 Park Court Pyrford Road, West Byfleet, Surrey, KT14 6SD.

 

The registered office of the overseas subsidiaries are as follows:-

 

Championship (Singapore) Pte Limited, 62 Neil Road, Singapore (088833).

 

Brick Live Far East Limited, RM 1307A 13/F, Two Harbourfront, 22 Tak Fung Street, Hughom, Hong Kong.

 

Parallel Live ((NY) LLC, 800 N King St, Suite 303, Wilmington, DE 19801, USA

 

E Movement Holdings (Pty) Limited, 9 Viscount Crescent, Baronetcy Estate, Plattekloof, Western Cape, 7500, South Africa.

 

Live Company Sports and Entertainment (Pty) Limited, Noland House, River Park, Mowbray, Western Cape, South Africa.

 

The company's subsidiaries Brick Live Group Limited, Parallel Live Group Limited, Brick Live International Limited, and Live Company Group EBT Limited are exempt from the requirements of the Companies Act 2006 relating to the audit of their individual accounts by virtue of section 479A of the Companies Act 2006.

 

35.     Post balance sheet events

 

In February 2022 6,223,859 new Ordinary shares in the Company were issued  in settlement of outstanding Director's fees. Senior Director Ranjit Murugason received 5,047,620 Ordinary shares at 3.5p, Bryan Lawrie received 747,667 Ordinary shares at 3.5p and Stephen Birrell received 428,572 shares at 3.5p price.

 

In March 2022 the outstanding balance of £90,823 due under the loan arrangement with David Ciclitira as detailed in Note 22 was repaid in full. Also in March 2022 £45,000 of the outstanding deferred consideration due to David Ciclitira in relation to the acquisition of EMHL as detailed in Note 29 was settled in cash.

 

In March 2022 16,500,000 new Ordinary shares of 1 pence each in the capital of the Company were issued at a price of 5p, raising £784,000 net of fundraising costs.

 

In April 2022 1,428,571 Investor warrants were exercised at a price of 5p raising £57,000.

 

 

Note to the announcement

The financial information set out above does not constitute the Company's statutory accounts for the year ended 31 December 2021 or year ended 31 December 2020, but is derived from those accounts. Statutory accounts for 2020 have been delivered to the Registrar of Companies and those for 2021 on which the auditors have provided an unqualified report will be delivered following the AGM.