18 February 2022

Pod Point Group Holdings PLC (Symbol: PODP)

Preliminary unaudited results for the period ended 31 December 2021

"Strong financial and strategic performance with excellent momentum"

Pod Point Group Holdings plc (the "Company") and its subsidiaries (the "Group"), one of the UK's market leading providers of Electric Vehicle ("EV") charging solutions is pleased to announce its preliminary unaudited results for the year ended 31 December 2021.

Financial Summary

⁽¹⁾ See Notes regarding comparative periods

(2) See Notes of this report for definition of Adjusted EBITDA

(3) See Notes for definition

Notes

Adjusted EBITDA is defined as earnings before interest, tax, depreciation and amortisation and also excluding both amounts charged to the income statement in respect of the Group's share based payments arrangements and adjusting for large corporate transaction and restructuring costs.  These have been separately identified by the Directors and adjusted to provide an underlying measure of financial performance.  The reconciliation is set out on the income statement and note 6 provides a summary of the amounts arising from the large corporate transactions and restructuring costs.

The listed entity Pod Point Group Holdings plc (formerly called EDF Energy EV Limited) was incorporated on 29th January 2020 and was used to acquire the Pod Point business at that time.  Consequently the Annual Report and detailed financial disclosure in this document discloses eleven month comparatives for the period from 29 Janaury 2020 to 31st December 2020.  The Pod Point business, however, traded for the full year of 2020 and full year financial disclosures were included in the Prospectus, published as part of the business' listing on the London Stock Exchange on 9th November 2021.  These summary tables and Business Review compare the financial results for the year to 31st December 2021 with the financial results for the year to 31st December 2020 to allow easier comparison by readers of this document.

Average annual recurring revenue per unit is calculated as annual recurring revenue divided by the total number of Commerical units installed and able to communicate at a period end. Commercial units shipped but not installed by Pod Point are not included in this statistic.

"Other" revenue includes Recurring revenue for the year ended 31 December 2021 of £918k compared to £551k for the full year of 2020 (11 months 2020: £511k), Owned Asset revenue for the year ended 31 December 2021 of £2,033k compared to £868k for the full year of 2020 (11 months 2020: £868k) and Norway revenue for the year ended 31 December 2021 of £233k compared to £401k for the full year of 2020 (11 months: £281k)

Group Highlights

·      Very strong performance with 86% year on year revenue growth to £61.4m

·      99% year on year growth in gross profit with margin increasing to 27% from 25%

·      Strong expansion of the customer base across both Home and Commercial segments

·      Increase in headcount from 247 to 447 including 73 inhouse installers supported by network of over 221 third party installers

·      Adjusted EBITDA of £58k was a result of increase in revenues and gross margin with the loss for the full year 2021 of £14m including one-off costs of IPO and share-based payment costs

Strategic and Operational Highlights

·      Raised £120m in a successful listing on the London Stock Exchange and received the Green Economy Mark at Admission, demonstrating the key role the company is playing in the transition to a sustainable economy

·      12.2m charging sessions delivered, enabling 955m km of low carbon travel and helping to avoid 127,267 tonnes of CO2e

·      Over 66,000 charge points installed and shipped (2020 full year: 35,763) while maintaining outstanding levels of customer service with a 4.3 out of 5 rating on Trust Pilot and a 4.65 out of 5 rating on review.io with a 91% recommendation rate

·      Market share in home charging increased to 18% (2020: 16%) driven by new commercial deals with car manufacturers and operators of business car fleets

·      Total number of units installed and able to communicate at the year end increased to 137,420 (2020: 77,498) providing an excellent base to expand recurring revenue products

·      Key OEM contracts won or renewed include Fiat, Jaguar Land Rover, Mercedes and Nissan

·      Pod Point now has over 130 active fleet business accounts with businesses including Coca-Cola, DHL and Royal Mail

·      In the Commerical segment key customer contracts won during the year included CBRE, Hermes and Serco, and we renewed our contract with LIDL

·      Owned asset sites increased to 453 with 984 charging points including 73 DC rapid units

Headline KPIs

(1) PiV defined as "Plug-in Vehicles"

Current trading and outlook

We have started 2022 strongly, with a significant volume of Home and Commercial orders received and increased demand driven by the end of the OZEV home grant subsidy and continuing market growth with January registrations of new Plug in Vehicles increasing to 23,840, a year on year increase of 89% and now representing over 20% of all new vehicles registered. Headline gross margin guidance for the full year is unchanged with some downward pressure expected in H1 on Home percentage margin as we navigate well-publicised component shortages prior to benefitting from unit manufacture cost savings from the on-boarding and production scaling of a second manufacturing partner during 2022.

2021 was a watershed year for EV adoption in the UK creating significant market opportunities for the Group. We look forward to continuing to take advantage of these in 2022 by investing across the business including expanding installation capability and software development to grow our recurring revenue streams.

Erik Fairbairn, Chief Executive Officer of Pod Point, said:

"It has been a hugely significant year for Pod Point. Becoming a publicly listed company took us one step closer towards our mission that travel should not damage the earth and, after successfully raising £120m at the IPO,  we are excited to continue growing and innovating in order to protect our planet.

I am extremely thankful for all my talented and dedicated colleagues, without whom these achievements would not have been possible. Together we significantly increased revenues for the year, selling over 66,000 charge points while continuing to provide an excellent service to our customers. The future is bright for Pod Point and, as electric vehicles become the norm rather than the exception, the market opportunity is clear. We can't wait to further accelerate our growth and continue our journey as the market leader - playing a key role in reducing carbon emissions and tackling climate change at this critical time."

Webcast presentation

There will be a webcast presentation for investors and analysts this morning at 09:30 am. Please contact podpoint@tulchangroup.com if you would like to attend.

Enquiries: 

Tulchan (Public Relations adviser to Pod Point)

James Macey White/ Mark Burgess/ Matt Low/ Laura Marshall / Arthur Rogers

+44 (0)20 7353 4200 / PodPoint@tulchangroup.com

BofA Securities (Joint Corporate broker)

Cara Griffiths / Mitchell Evans

+44 (0)20 7628 1000

Numis (Joint Corporate broker)

Garry Levin / Andrew Coates

+44 (0)20 7260 1000

About Pod Point Group Holdings plc

Pod Point was founded in 2009 by CEO and entrepreneur Erik Fairbairn. Driven by a belief that travel shouldn't damage the earth, Pod Point has installed over 137,000 charge points and is an official charge point supplier for major car brands.

Pod Point installs a broad range of products from smart domestic charge points to high power rapid chargers and load balancing systems. Pod Point works with a broad range of organisations and customers to offer home and commercial charging solutions with customers including major retailers, hotels, restaurants and leisure venues. 

Pod Point is admitted to trading on the London Stock Exchange under the ticker symbol "PODP."

For more information, visit https://pod-point.com/

Chief Executive's Review

Overview of results: An extraordinary year ends - and an exciting future beckons

This has been an awesome year for Pod Point. We believe we have made more progress towards our goal of travel which doesn't damage the earth than in any prior year. We also set ourselves up for even greater acceleration towards our mission in the future. We concluded the year by becoming a publicly listed company and we were delighted to receive the Green Economy Mark at Admission to the London Stock Exchange. The IPO enabled us  to gain the financial resources we need to support our objectives. Across 2021, we installed and sold over 66,000 charge points, maintained outstanding customer satisfaction ratings and provided enough electricity to power 955 million kilometres [1]of electric driving through our network.  Our revenues grew by 86% from £33,082k to £61,415k and we delivered, for the first time, a positive adjusted EBITDA of £58k for the year to 31^st December 2021.

[1] Calculation: Energy transfer (Pod Point Internal Data) multiplied by average EV efficiency 3.46 m/kWh (https://ecocostsavings.com/average-electric-car-kwh-per-mile/) and converted from miles into km (multiply by 1.60934)

The IPO that we concluded in November was the product of years of hard work from the incredible Pod Point team. Becoming a public company is a massive milestone for us as we strive to achieve our mission. We will use the £120m of proceeds to support our growth plans, including further developing our products to suit more routes to market, investing in our software capability to build recurring revenues on top of our network, and investing in DC rapid owned assets and multi-tenancy dwelling installations at key strategic charging locations.

Our IPO marks the start of the next, and perhaps most important, phase for us - and timing is very much on our side. As COP26 emphasised, the world is now really starting to wake up to the scale of the climate change challenge, and we are ideally placed to play a major role in reducing the UK's transport carbon emissions and improving air quality for everyone.  I believe the UK has made a very positive start as demonstrated by over 305k new PiV registered during 2021 compared to 175k in 2020, an increase of 74%, representing 18.5% of new vehicle registrations compared to 10.7% in 2020 with similar total numbers of vehicles sold in each year.

In terms of specific sustainability KPIs Pod Point:

·      Delivered 12.2m charging sessions (2020 full year: 4.7m)[2]

·      Helped to avoid 127,267 tonnes of CO2e (2020 full year: 38,360 tonnes)[3]

·      Enabled 955 million kilometres of low carbon travel (2020 full year: 296 million kilometres)

·      Enabled 172 GWh of electricity to be delivered (2020 full year: 53 GWh)

I would like to extend a massive thank you to the whole team at Pod Point. Their hard work throughout the IPO process was incredible to see. It was not easy, but ultimately the effort was well worthwhile - for our people, our new shareholders and, ultimately, for our planet.

[2] Pod Point Internal Data

[3] Calculated as difference in CO2e between a typical BEV and a typical ICE vehicle as follows. BEV CO2e : fEnergy Transferred, multiplied by Grid Intensity data for year from DfT (https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/891105/Conversion_Factors_2020_-_Condensed_set__for_most_users_.xlsx and https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/1049332/conversion-factors-2021-condensed-set-most-users.xls). ICE Vehicle CO2e - Energy transferred converted into distance (see note 1). Distance converted into CO2e using average car and 50/50 split of petrol and diesel using DFT Conversion factors. Then deducted BEV CO2e from ICE CO2e to give a saving value in CO2e

Sector Review

In the Home business segment:

·      The Home business segment delivered an excellent performance, with revenue of £40,272k compared to full year 2020 of £20,340k (2020 11 months: £19,356k) a year on year increase of 98%. This was driven by growth in Pod Point's core market and market share gains.

·      New PiV registrations increased to 305,277 in 2021 from 175,084 in the full year 2020 (2020 11 months: 166,242), an increase of 74% and the number of units installed increased to 54,977 compared to 28,361 in the full year of 2020 (2020 11 months: £27,011) an increase of 94%. This led to Pod Point's market share of new PiV registrations increasing to 18% from 16% in the full year 2020 (2020 11 months: 16%).

·      This increase in revenues helped to deliver an increased total gross margin in 2021 of £11,347k compared to full year 2020 of £5,126k (2020 11 months: £4,936k) a year on year increase of 121%. 

·      Percentage gross margin in 2021 grew to 28% compared to full year 2020 of 25% (2020 11 months: 26%), a year on year increase of three percentage points.  This was supported by an increase in revenue per unit to £733 from £717 in the full year 2020 (2020 11 months: £717) which offset c£200k of unit component costs growth in the second half of 2021.

·      Key customer contracts won or renewed during the year included Fiat, Jaguar Land Rover, Mercedes and Nissan, and the business now has over 130 active fleet business accounts with businesses including Coca-Cola, DHL and Royal Mail.

In the Commercial business segment:

·      Strong performance with revenue of £17,959k compared to full year 2020 of £10,922k (2020 11 months: £10,010k) a year on year increase of 64%. 

·      Number of units installed increased to 3,838 compared to 2,546 in the full year of 2020 (2020 11 months: 2,336) and the number of units sold directly increased to 7,187 compared to 4,856 in the full year of 2020 (2020 11 months: 4,318) representing a total increase of 49% with Pod Point's market share of new PiV registrations remaining flat year on year at 4% (2020 11 months: 4%).

·      This increase in revenues helped to deliver an increased total gross margin in 2021 of £3,929k compared to full year 2020 of £2,447k (2020 11 months: £2,262k) a year on year increase of 61%. 

·      Percentage gross margin in 2021 remained at 22% compared to full year 2020 (2020 11 months: 23%).  Average revenue per unit increased to £1,629 from £1,476 in the full year 2020 (2020 11 months: £1,504) due to a change in the mix of installations, with more higher value installations in 2021.

·      Key customer contracts won during the year included Hermes, Serco and CBRE and we renewed our contract with LIDL.

In the Recurring revenue business segment:

·      Good performance, with revenue of £918k compared to full year 2020 of £551k (2020 11 months: £511k) a year on year increase of 67%.  Network revenues increased to £751k compared to full year 2020 of £462k (2020 11 months: £429k) and other revenues increased to £167k compared to full year 2020 of £89k (2020 11 months: £82k).

·      This increase in revenues helped to deliver an increased gross margin in 2021 of £412k compared to full year 2020 of £140k (2020 11 months: £174k) a year on year increase of 171%. 

·      In addition, percentage gross margin in 2021 increased to 45% compared to full year 2020 of 25% (2020 11 months: 34%) a year on year increase of twenty percentage points, with the average annual recurring revenue per unit installed and unit able to communicate increasing to £57.40 compared to full year of 2020 of £50.40 (2020 11 months: £46.67).

·      The number of Commercial units installed and able to communicate at the year end increased to 16,005 compared to 10,950 at the end of 2020.  All recurring revenues in both 2021 and 2020 were derived from these units. 

·      The number of Home units installed and able to communicate at the year end increased to 121,415 compared to 66,548 at the end of 2020. This growth is strategically significant as the business seeks to expand its recurring revenue products across these units. 

In the Owned Asset business segment:

·      Strong performance with revenue of £2,033k compared to full year 2020 of £868k (2020 11 months: £868k) a year on year increase of 134%. 

·      The total number of sites installed at the period end increased to 453 compared to 292 at the end of 2020.  The total number of units installed at the period end increased to 984 compared to 596 at the end of 2020, including 73 Rapid/DC units at the end of 2021 compared to 12 at the end of 2020.

·      This increase in revenues and units helped to deliver an increased gross margin in 2021 of £868k compared to full year 2020 of £531k (2020 11 months: £474k) a year on year increase of 63%. 

·      Percentage gross margin in 2021 declined to 43% compared to full year 2020 of 61% (2020 11 months: 55%) a year on year decrease of 18 percentage points.  Within the current commercial arrangements for this segment Pod Point, for two years, pays for the free electricity provided to customers who use the non-Rapid/DC charge points at 198 sites out of the total of 453 sites (Tesco pay for electricity at the remaining sites).  With Covid restrictions and changes to people's patterns of travel the level of free usage was lower than expected for all of 2020 and some of 2021, however, as patterns of travel have normalised usage has increased dramatically in the second half of 2021 resulting in higher usage and costs and lower 2021 percentage margin.  The provision of free electricity by Pod Points stops at 179 sites by the  end of February 2022 and all 198 sites by the end of July 2022.  The price of electricity charged to Pod Point has been fixed since 2021 and the increased costs are solely due to the increase in free usage at the 198 sites.

·      Gross capital deployed on assets increased to £3,895k at the end of 2021 compared to £2,380k at the end of 2020.

Financial Performance

It was a very strong performance by the business in 2021 with total revenue of £61,415k compared to full year 2020 of £33,082k (2020 11 months: £31,026k), a year on year increase of 86%, with the biggest growth from our Home business segment.

This increase in revenues helped to deliver an increased total gross margin in 2021 of £16,345k compared to full year 2020 of £8,203k (2020 11 months: £7,716k) a year on year increase of 99%.

In addition, total percentage gross margin in 2021 increased to 27% compared to full year 2020 of 25% (2020 11 months: 25%) a year on year increase of two percentage points.

The increase in revenues and gross margin helped the business deliver a positive adjusted EBITDA of £58k in 2021, compared to full year loss in 2020 of £331k (2020 11 months: loss of £55k).

Helped by the significantly improved financial performance of the business and the IPO in November 2021 year end cash and short term investments were £96,112k compared to £2,943k at the end of 2020.

Unadjusted losses after tax increased to £14,322k in 2021 compared to full year losses in 2020 of £12,959k (2020 11 months: £12,193).  EBITDA losses reduced in 2021 with losses of £8,103k compared to full year losses in 2020 of £8,549k (2020 11 months: losses of £7,971k).  There were increased depreciation and amortisation costs of £4,929k compared to full year 2020 of £3,772k (2020 11 months: £3,614k) and net financing costs of £1,290k compared to full year 2020 of £638k (2020 11 months: £608k).

Total administrative expenses as disclosed on the Income Statement increased to £29,377k compared to full year 2020 of £20,254k (2020 11 months: £19,301k) a year on year increase of 47%.  This increase was due to the growth in the size of the business and the additional staff required to deliver this growth, the one off and ongoing cost of being a Listed company (including Share Based Payments) and additional depreciation and amortisation costs as a result of additional funds being invested in Owned Assets and intangible asset development. The business continues to increase its support costs to support the growth, and its requirements as a listed business and incurred significant one off costs in both periods.  Looking at these individually:

·      Administrative expenses excluding one off large corporate transaction and restructuring costs, share based payments and depreciation and amortisation costs  increased to £16,287k compared to full year 2020 of £8,534k (2020 11 months: £7,771k) a year on year increase of 91%.  This increase was due to the growth in the size of the business and the additional staff required to deliver this growth and the ongoing costs of being a Listed company.

·      Depreciation and amortisation costs increased in 2021 to £4,929k compared to £3,772k for the full year 2020 (2020 11 months: £3,614k) as a result additional funds being invested in Owned Assets and research and development.

·      Following the listing in November 2021, Pod Point incurred share based payment charges relating to a number of share awards which were implemented at or soon after listing resulting in a charge to the P&L of £2,422k.

·      One off large corporate transaction and restructuring costs, relating primarily to the Listing were £5,739k which compared to £8,042k for the full year 2020 (2020 11 months: £7,916k) when the business incurred costs primarily relating to the purchase of the Pod Point business.

Net finance costs, primarily related to borrowing from Pod Point's pre-listing shareholders increased to £1,290k in 2021 compared to £638k in 2020 (2020 11 months: £608k), as a result of additional funds being loaned to the business to support its growth. All shareholder loans were repaid upon listing in November 2021 and finance costs in 2022 are expected to be limited.

Most key balance sheet accounts increased year on year due to the increase in the size of the business, this included trade and other receivables, inventory and trade and other payables.  

Closing cash and short term investments were £96,112k (2020: £2,943k). At 31 December 2021 £50,000k of cash had been placed on a six month bank deposit and so has been classified as a short term investment. Closing net assets were £199,835k (2020: £98,773k)

Cash outflow from operating activities decreased by £3,661k to £2,216k in the full year 2021 from £5,877 in the full year 2020 (2020 11 months: £6,509k). This was primarily due to a smaller operating loss, once the non-cash impact of share based payments had been taken into account

Cash flows used in investing activities decreased to £57,184k in the full year 2021 compared to £89,708k in the full year 2020 (2020 11 months: £89,559k) primarily due to the acquisition of the Pod Point group in 2020 which included £85m of cash consideration. £50m of the investing activity in 2021 relates to the purchase of short-term investments which are long-term bank deposits classified as investments due to their tenor.

Cash inflow from financing activities increased to £102,569k in the full year 2021 compared to £92,932k in the full year 2020 (2020 11 months: £95,060k) primarily due to the listing of the business with gross funds raised of £120,000k less transaction costs of £7,664k and with net shareholder loans of £9,280k repaid following the listing. 2020 included £85m of a loan from the majority shareholder, which was used to acquire the Pod Point group, being waived.

During 2021 transactions with related parties included sale of goods of £309k compared to full year 2020 of £194k (2020 11 months: £151k), purchase of goods of £850k compared to full year 2020 of £88k (2020 11 months: £88k), and interest on intercompany loans of £1,038k compared to full year 2020 of £510,351 (2020 11 months: £510,351). These transactions were undertaken with the two shareholders EDF Energy Customers Limited and Legal & General Capital Investments Limited and their subsidiaries.

Market Opportunity and Outlook

We continue to see rapid growth in the UK electric vehicle market, with January 2022's new plug in vehicle registrations of 23,480, 89% up on January 2021 and representing over 20% of all vehicles registered. We expect the mix of vehicles to change with battery electric vehicles continuing to grow its share of plug in vehicles primarily on the back of more choice for the consumer with c35 new battery electric models expected to be launched in 2022. It is worth emphasising that battery electric vehicles remain only 1% of total vehicles on the road so the growth potential for the business remains significant.

Whilst the current price increases in electricity are an obvious concern for consumers and businesses we do not expect them to materially impact sales of electric vehicles as the ongoing running costs will still be significantly cheaper than vehicles reliant on internal combustion engines.

We expect the Government to continue to wind back direct fiscal incentives and to focus on indirect actions such as the recently implemented changes to planning regulations which require developers to include charge points in new properties. We see this as the right strategy and an opportunity for Pod Point.

We expect global supply chain challenges to continue and to impact both supply of new vehicles and the manufacture of charge points across all suppliers. We are very focused on ensuring we continue to have adequate supply of units for our customers and have already incurred and expect further additional component cost inflation. To mitigate this risk we are onboarding a second manufacturing partner and expect cost savings to start to be delivered in H1 and scale across the year. Overall we expect some margin pressure in H1 but expect full year margins to be in line with guidance as set out at IPO.

In 2022 we plan to invest in the three main areas we set out at IPO:

·      Firstly, we are going to expand our product offering to serve more routes to market, such as multi-tenancy dwellings and on street charging.  It is important that the EV revolution does not leave anybody behind - and flats and on street parking are significant segments that we need to deliver for. We will be investing in our products to meet the needs of these customers.

·      Secondly, we are going to invest in developing our software capability to realise a number of recurring revenue business models. Our charge points are already smart, so we will be building software on top of our network to enable our charging points to work in harmony with the grid at both a local and national level. With so many consumers moving to a reliance on electricity for their driving, as well as potentially for heating, we are going to see a significant increase in the demand for electricity across the UK. Amongst other activities, we plan to use our network of charge points to carefully manage how energy flows into the nation's electric cars and hence manage load on the grid. We expect to do this in a way which doesn't inconvenience the EV driver in a material way. This is going to be a challenge - but as the country's leading provider of charging solutions, it is our responsibility to be part of the solution, not part of the problem.

·      Finally, our strategy is to increase our investment in our owned charge point assets, such as those at destinations and en-route, including retail parks and leisure locations. These charge points will be a mix of AC charge points for those locations with longer dwell times and DC units capable of rapid charging at speed so drivers can get on their way quickly. Our 2021 driver survey revealed that the majority wanted to access rapid charge points, confirming that rapid charging is regarded as an essential part of a fully integrated and effective EV ecosystem.

Pod Point is leading the market and we are ready to accelerate. We expect to be making these investments at the same time as more and more of the UK population choose an electric vehicle as their next car, and in doing so make a significant contribution to reducing the carbon intensity of the UK transport sector.

It has been a privilege to lead the Pod Point team through what has been an incredible year. We have made more progress against our goals than ever before, and next year looks like it is going to be even more impressive.  

Never has our mission seemed more important - the more we understand climate change, the greater the challenge we face, and consequently the more important achieving our mission of travel which doesn't damage the earth becomes.

I am confident that we go into 2022 with the team, the resources, the market position and the demand to make it our best year ever.

Principal Risks and Uncertainties

Risk management

Effective risk management is essential to the achievement of our strategic objectives and driving sustainable business growth. We aim to maintain an appropriate balance between protecting the company against specific risks while being able to encourage appropriate and monitored risk-taking and innovation that allows us to take advantage of business opportunities.

Our approach to risk management has always been an integral part of our overall governance and management approach centred around identification, assessment, monitoring and management of risk. Although some aspects of risk governance were enhanced and formalised around the IPO in November 2021, the key elements were in place beforehand. During 2021, we identified 23 key risks that had the potential to impact our business, and these were included in the IPO Prospectus. We have now rationalised that initial list and arrived at a total of 10 Principal Risks, details of which are provided below.

As we move into 2022 and our first full year as a listed company, we are working to embed and develop all aspects of our risk management framework and process and will report in more detail on this progress in our 2023 Annual Report.

Responsibility for risk

Our risk management framework is designed to foster a proactive, open and accountable culture of "bottom up" reporting and escalation, partnered with informed and experienced "top down" direction and oversight. With respect to risk, we believe the role played by our operational teams and management is just as important as the role played by the executive team, the Audit & Risk Committee and the Board. Whilst the Board has overall responsibility for the management of risks, it is our open culture of ownership and responsibility for the governance of risk that sets the tone across the business.

Risk identification

Our approach to risk combines a top-down strategic view that meshes with a bottom-up reporting and escalation culture. We support a pro-active, open and accountable culture across the business to provide the right conditions for risk identification, discussion and escalation. The strategic view involves an assessment of the external environment in which we operate to evaluate the risks which we are comfortable being exposed to in pursuit of our performance objectives - our risk appetite.

The bottom-up reporting culture allows for the identification, management and monitoring of risks in each area of the business thus ensuring that risk management is embedded in our everyday operations.

Once identified, management, tracking and control of risks is provided through our risk register which in turn helps us to steer the strategy of the business.

Risk measurement and tracking

Our risk register has been developed to allow the key risks we identify to be scored and for the actions taken to mitigate and control them to be tracked and monitored. The risk register was established during the IPO process and is owned and developed by the executive team.

The risk register sets out the key risks identified in each of our business segments and functions, allocating an owner to each, together with an assessment of the risk impact, likelihood of occurrence and a scoring of the risk on an inherent unmitigated basis; and a mitigated basis after having taken account of internal controls and appropriate steps being taken to minimise impact or reduce the likelihood of occurrence. It also keeps a record of actions to be undertaken in the future to further mitigate the impact of risk.

The risk register is helpful in identifying the actions required going forward to:

•           ensure greater consistency of controls across the business;

•           consider the need for additional controls or a change to the current processes;

•           protect the business from unexpected events; and

•           improve the efficiency and effectiveness of financial and operational processes.

Risk management and monitoring

Performance monitoring of risk management activity must ensure that the treatment of risks remains effective and that the benefits of implementing risk control measures outweigh the costs of doing so. Performance monitoring is a continual review not only of the whole process, but also of individual risks or projects and of the benefits gained from implementing risk control measures.

Our process for managing risk is:

(i)         Identify realistic risks

This involves looking externally at the market and internally at financial and business operations to establish what events could impact us. This is an ongoing activity as part of daily engagement between management and teams across the business. As part of our quarterly strategic review, our executive team dedicates time to reviewing and updating our assessment of existing risks tracked on our risk register as well as horizon scanning for emerging risks that may impact us in the future.

(ii)        Analyse their potential impact and likelihood

With all risks identified, we assess the likelihood of their occurrence and the potential consequence or impact of that occurrence on both an inherent (unmitigated) and a mitigated basis, after having accounted for appropriate steps being taken to control, monitor and minimise their impact.

(iii)       Score risks to prioritise their management

The likelihood and impact of each risk on business performance is calculated in order to score each risk and enable prioritisation of resources towards actions recorded on the risk register.

(iv)       Treat risks to minimise their impact

Once scored, the risks that are considered acceptable and those that need to be further addressed are established. For acceptable risks, where needed appropriate mitigation steps are assigned for implementation and tracking. For unacceptable risks, strategies are developed to avoid them to the extent possible and plans made so that the business is ready to deal with them and their impact is minimised should they occur. The outcome of this step is a prioritised list of risks and actions which the business can act upon and allocate resources towards.

(v)        Continually monitor the situation

The position is thereafter checked for risks occurring, new risks emerging and changes in the assessment of existing risks in order that these can be reviewed and dealt with competently. The risk register is reviewed on an ongoing basis by the executive team, with a formal quarterly update and on a biannual basis by the Board, with the Audit & Risk Committee conducting an in-depth annual review.

Our principal risks

Our growth and success is focused on helping respond to climate change challenges and is correlated with and thus dependent upon the continuing adoption of and demand for EVs.

Competition in the industry and market segment in which we operate may materially adversely affect our market share, margins and overall profitability.

We currently rely on a single manufacturer for our in-house designed and branded AC charge points. A loss of or a disruption to this manufacturer or any of the manufacturer's suppliers and/or sub-suppliers could negatively affect our business.

Ongoing and potential future disruptions to the global supply chain could have a material adverse effect on demand for our products as well as on our ability to source and produce components for our charge points.

Government and regulatory initiatives, the outcomes of which are unknown, could materially impact our business.

We are exposed to health and safety risks related to our products and the installation, maintenance and operation of electrical equipment and systems.

Our technology could have undetected defects, errors or bugs in hardware or software

The deterioration of economic conditions in the UK, a deterioration in the UK's economic relationship with the EU or a future health pandemic may materially adversely impact our business, financial condition and results of operations

Disruptions to our network and IT systems, including from malware, viruses, hacking, phishing attacks and spamming

Our success depends on our ability to hire and retain management, key employees and other qualified and skilled employees and we may not be able to attract and retain such personnel

Director's Responsibilities Statement

The Directors are required to prepare financial statements for each financial year which present a true and fair view of the financial position of the Company and of the Group and the financial performance and cash flows of the Company and of the Group for that period. The Directors have elected to prepare the Group and parent company financial statements in accordance with the UK-adopted International Financial Reporting Standards ('IFRSs') in conformity with the Companies Act 2006.

In preparing those financial statements, the Directors are required to:

•           select suitable accounting policies in accordance with IAS 8: 'Accounting Policies, Changes in Accounting Estimates and Errors' and then apply them consistently;

•           make judgements and accounting estimates that are reasonable and prudent;

•           present information, including accounting policies, in a manner that provides relevant, reliable, comparable and understandable information;

•           provide additional disclosures when compliance with the specific requirements in IFRSs is insufficient to enable users to understand the impact of particular transactions, other events and conditions on the Company and of the Group's financial position and financial performance;

•           state whether UK-adopted international accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements; and

•           prepare the accounts on a going concern basis unless, having assessed the ability of the Company and the Group to continue as a going concern unless it is appropriate to presume that the Company and/ or the Group will not continue in business.

The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's and Group's transactions and which disclose with reasonable accuracy at any time the financial position of the Company and of the Group and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company's website. Legislation in the UK governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

Neither the Company nor the Directors accept any liability to any person in relation to the annual financial report except to the extent that such liability could arise under English law. Accordingly, any liability to a person who has demonstrated reliance on any untrue or misleading statement or omission shall be determined in accordance with section 90A and schedule 10A of the Financial Services and Markets Act 2000.

Basis of Preparation and General Information

The consolidated financial information for Pod Point Group Holdings Plc (the Company) and its subsidiaries (together, the Group) set out in this preliminary announcement has been derived from the unaudited consolidated financial statements of the Group for the year ended 31 December 2021 (the financial statements). The Company's Annual Report and Accounts ("Annual Report") for the year ended 31 December 2021 will be published on in late April 2022. It will sent to shareholders and posted on its website: www.pod-point.com/investors and uploaded to the National Storage Mechanism in accordance with LR 9.6.1 R on the same date

This unaudited preliminary announcement does not constitute the full financial statements prepared in accordance with International Financial Reporting Standards (IFRS). The unaudited preliminary announcement was approved by the Board of directors on 18 February 2022. Statutory accounts for 2020 have been delivered to the Registrar of Companies and the Company's Annual Report will be finalised subsequent to this preliminary unaudited results announcement.

The financial statements have been prepared in accordance with international accounting standards in conformity with the requirements of the Companies Act 2006 and International Financial Reporting Standards adopted pursuant to Regulation (EC) 
No 1606/2002 as it applies in the European Union and have been prepared on a going concern basis (Note 1).

Further information including on accounting policies and the full accounting notes will be set out in the Annual Report and such information  for 2020 was included in the Prospectus which was published on 9^th November 2021.

Consolidated Income Statement

Notes:

(1)        EBITDA is defined as earnings before interest, tax, depreciation and amortisation, and is considered by the Directors to be a key measure of financial performance. Adjusted EBITDA is defined as earnings before interest, tax, depreciation and amortisation and excluding both amounts charged to the income statement in respect of the Group's share based payments arrangements and also adjusting for large corporate transaction and restructuring costs.  These have been separately identified by the Directors and adjusted to provide an underlying measure of financial performance.  The reconciliation is set out on the income statement and note 6 provides a summary of the amounts arising from the large corporate transactions and restructuring costs.

(2)        Transaction costs and other restructuring costs. See Note 6

(3)        All amounts relate to continuing activities.

(6)        All realised gains and losses are recognised in the consolidated income statement and there is no other comprehensive income.

(7)        The notes on pages 25 to 36 form part of the Financial Information.

(8)        There is no other comprehensive income in the years presented and therefore no separate statement of other comprehensive income is presented.

(9)        As set out in the basis of preparation, the year ended 31 December 2021 is unaudited

Consolidated Statement of Financial Position

Consolidated Statement of Changes in Equity

As at 31 December 2021:

As at 31 December 2020:

(1) In 2020, parent company EDF Energy Customers Limited ("EECL") formally waived a loan to the Group. This amount has been treated as a capital contribution and is not recognised in the P&L.

Consolidated Statement of Cash Flow

Please note that £50,000k of cash was held in a short term deposit account at the 31 December 2021 and for reporting purposes is shown as an investment above. Closing cash and short term investments total £96,112k.

Consolidated Notes to the financial statements

1.         General information

Pod Point Group Holdings plc (referred to as the "Company") is a public limited company incorporated in the United Kingdom under the Companies Act 2006. Its registration number is 12431376. The registered address is 28-42 Banner Street, London EC1Y 8QE.

The principal activity of the Company and its subsidiary undertakings (the "Group") during the years presented is that of development and supply of equipment and systems for recharging electric vehicles. The entire issued share capital of the Company was admitted to trading on the Main Market of the London Stock Exchange on 9 November 2021. All figures presented in this audited preliminary annoucement are in £ sterling.         

The Directors have made enquiries and reviewed cash flow forecasts and available facilities for at least the next 12 months (including subsequent events). Taking these into account the Directors have formed a judgement, at the time of approving the unaudited preliminary announcement, that there is a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. This judgement has been formed taking into account the principal risks and uncertainties that the Company faces.

2.         Segment reporting

             The Group has five operating and reportable segments which are considered:

             There are no transactions with a single external customer amounting to 10 per cent. or more of the Group's revenues.

             Work, destination and en-route revenues are routes to market within the UK Commercial and Norway segments, rather than individual business segments with the types of installations being similar in all three.

             UK Home, UK Commercial, Owned Assets and Recurring revenue not generated in Norway are collectively referred to as UK. Norway recurring and non-recurring activities are collectively referred to as Norway. Norway includes both home and commercial charging. Revenue has been further split into OZEV and non-OZEV revenues for each segment. OZEV revenues are the portion of revenue generated from an install, which are claimed from the DVLA by the Group on behalf of customers who are eligible for the EVHS government grant.

             A breakdown of revenues and non-current assets by geographical area is included in Note 4. Assets and liabilities are not reviewed on a segmental basis and therefore have not been included in this disclosure.

             Segmental Analysis for the Year ended 31 December 2021:

             Segmental Analysis for the 11 months ended 31 December 2020:

3.         Group operating loss

             Loss for the year has been arrived at after charging/(crediting):

4.         Revenue and non-current assets

             Revenue, analysed geographically between markets, was as follows:

Revenue, split between OZEV revenues and non-OZEV revenues was as follows:

All OZEV revenue was earned in the UK. Non-current assets are all held within the UK for all periods presented.

5.         Directors and employees

             The Group operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the Group in an independently administered fund. The pension cost represents contributions payable by the Group to the fund and amounted £416,362 to for the year ended 31 December 2021 (11 months ended 31 December 2020: £261,533).

             Pension contributions payable amount at 31 December 2021 was £101,116 (2020: £52,011).

             The table below presents the staff costs of these persons, including those in respect of the Directors, recognised in the income statement.

Staff costs presented in this Note reflect the total wage, tax and pension cost relating to employees of the Group. These costs are allocated between administrative expenses, cost of sales or capitalised where appropriate as part of Software Development intangible assets. The allocation between these areas is dependent on the area of business the employee works in and the activities they have undertaken.

             During the year ended 31 December 2021, £2,903,567 of staff costs were capitalised (11 months ended 31 December 2020: £1,866,280).

             Key management personnel

             Key management personnel of the Group are the members of the Board of Directors as well certain other members directing and controlling the activities of the Group. Directors appointed by EDF are remunerated by EDF and their costs are not recharged and an allocation of cost is not considered readily identifiable.

             Key management costs include the following expenses:

6.         Adjusting large corporate transaction and restructuring costs

             Adjusting large corporate transaction and restructuring costs, for the purposes of presenting non-IFRS measure of adjusted EBITDA are as follows:.

           Raising finance relates to equity financing which given its scale in the period is not considered to be in the normal course of the operating business.

             Acquisition costs include national insurance related to the exercise of the share options, completion bonus payments to staff and retention bonus awards relating to the acquisition of the underlying Pod Point business in February 2020.

             Restructuring costs are staff related costs arising from changes to the senior management team and department reorganisations that were not in the normal course of the operating business.

7.         Finance income and finance costs

             Net financing costs comprise bank interest income and interest expense on borrowings, and interest expense on lease liabilities.

8.         Intangible assets

             Intangible assets as at 31 December 2021:

             Intangible assets as at 31 December 2020:

9.         Property, Plant and Equipment

             Property Plant and Equipment as at 31 December 2021:

Property Plant and Equipment As at 31 December 2020:

10.       Inventories

The cost of inventories recognised as an expense during the year ended 31 December 2021 in respect of continuing operations was £24,554,303 (11 months ended 31 December 2020: £13,158,238).

             An impairment loss of £37,440 was recognised in cost of sales against stock during the year ended 31 December 2021 due to slow-moving and obsolete stock (11 months ended 31 December 2020: £190,423).

11.       Trade and other receivables

12.       Trade and other payables and other non-current liabilities

12.1     Trade and other payables-current

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

             The contingent consideration of £1,000,000 relates to a warranty retention liability which was set up on the acquisition of Pod Point Holding Ltd by the Company in February 2020. No warranty claims have been made against the shareholders of Pod Point Holding Limited and the amount was repaid to shareholders of Pod Point Holding Limited on 11 February 2022.
 

12.2     Other non-current liabilities

13.       Loans and borrowings

             The bond which existed as of 31 December 2020 was redeemable by the bondholders on the anniversary of the commencement date, in January of each year, provided the bondholder had completed a notice of redemption. The bond carried an interest rate of 8 per cent. per annum. The entire bond was redeemed on 31 December 2021.

             During the 11 months ended 31 December 2020, the Group entered into £3.5 million facility agreement with Triodos Bank UK Limited, to fund charging units owned by the Group and installed at customer sites. The facility is structured as construction facility while the assets are being installed, at which point the outstanding balance will become an operating facility. The interest rate is fixed at 3.5 per cent. The loan is repayable in eighteen quarterly instalments starting one quarter after the start of the operating facility.

             As at 31 December 2020, the Group held intercompany loans with parent companies EECL and LGCIL under a revolving credit facility. For each loan drawn before 31 December 2021, the applicable rate of interest on the loan is the reference rate (LIBOR) and the margin (7.3 per cent. per annum). For each loan drawn on or after the rate switch date on 31 December 2021, SONIA and a credit adjustment spread rather than LIBOR will be used as the reference rate for calculating interest for such loan. The entire balance of the loans was repaid upon listing on 9 November 2021.

             As of December 2020, the Group held an additional intercompany loan with parent company EECL of £630,000 in addition to the loan mentioned above. This loan was formally waived on 6 October 2021, resulting in a corresponding increase to retained earnings at that date.

14.       Capital and reserves

             The share capital in issue at each year and period end is as follows:

On 10 December 2021, 549,000 shares were issued and allotted pursuant to the Share Incentive Plan, bringing the total issued share capital to 153,952,537.

IPO Reorganisation

As at 31 December 2020, the issued share capital of the Company comprised 13,118 ordinary shares of £.0001 each. In connection with admission, the Company reorganised its share capital as follows:

•           On 20 October 2021, the Company issued 999,986,882 bonus shares of £0.0001 each, resulting in a share capital of £100,000, divided into 1,000,000,000 ordinary shares of £0.0001 each. Subsequently on 20 October 2021, the Company undertook a consolidation of its share capital on a 10:1 basis, resulting in a share capital of £100,000, divided into 100,000,000 ordinary shares of £0.001 each. This resulted in a reduction of share premium of £100,000.

•           On 9 November, 2021, Pod Point Group Holdings PLC issued 53,403,357 ordinary shares as part of the Initial Public Offering in exchange for cash of £117,940,367, represented by share capital of £53,403 and share premium of £112,229,304. Immediately following Admission, the issued share capital of the Company was £153,404, comprising of 153,403,537 shares of £0.001 each.

Issuance costs of £7,664k were recognised against share premium in accordance with the Companies Act 2006, section 610.

Share premium

             The share premium reserve reflects the excess over nominal value arising on the issue of ordinary shares. During 2020 as part of the plans to acquire a 100% stake in Pod Point Holding Limited 13,118 shares with a nominal value of £0.0001 per share were issued to EECL and LGCIL. A share premium reserve arose of £26.4 million. See IPO reorganisation note above for effects on share premium as a result of the Initial Public Offering in November 2021.

             Other Reserves

             Other reserves includes the share based payment charge on share options issued to employees as detailed in Note 15 (Share based payments).

             Accumulated losses

             Accumulated losses reserve represents the accumulated losses of the Group generated through business activities. In 2020 a loan from EECL of £84.6 million was waived resulting in a capital contribution and a corresponding increase to retained earnings     

15.       Share based payments

             Charge to the income statement:
             The charge to the income statement is set out below:

 

During the year ended 31 December 2021, the Group operated the following share based payment schemes, all of which are equity settled.

16.       Earnings/(Loss) per share

             Basic earnings per share is calculated by dividing the loss attributable to the equity holders of the Group by the weighted average number of shares in issue during the year.

             The group has dilutive ordinary shares for the years ended 31 December 2018 and 31 December 2019, these being share options granted to employees. As the Group has incurred a loss in all periods, the diluted loss per share is the same as the basic earnings per share as the loss has an anti-dilutive effect.

In determining the share numbers and earnings per share calculation above the requirements of IAS 33 'Earnings per share' have been applied to reflect the bonus issue and share consolidation detailed in Note 14 as if it had taken place at the start of the earliest period for which an earnings per share is presented.

17.       List of subsidiaries

             The Group holds share capital in the following companies:

18.       Related parties

             Transactions with Shareholders

             For the 11 months ended 31 December 2020, the immediate parent companies of the Group is EDF Energy Customers Limited , owning 77.5% and Legal & General Capital Investments Limited , owning 22.5%. As at 31 December 2020, the Group held a loan with EDF Energy Customers Limited  of £6,710,602 and a loan with Legal & General Capital Investments Limited of £1,939,398. The entire loan balances were repaid upon IPO in November 2021.

             As at 31 December 2020, the Group held an additional loan of £630,000 with EDF Energy Customers Limited, which on 6 October 2021 was formally waived, resulting in a corresponding increase to retained earnings at that date.

             During the 11 months ended 31 December 2020, the Group had the following transactions with group companies part of the EDF Group and Legal & General group:

             During the year ending 31 December 2021, the Group had the following transactions group companies part of the EDF Group and Legal & General group:

             Transactions with related parties who are not members of the Group

             During the year ended 31 December 2021, the Group had the following transactions with a related party who is not a member of the Group. Imtech Inviron Limited is a related party by virtue of their ultimate parent and controlling party being Électricité de France S.A.:

•           Sale of goods of £48,179 (11 months ended 31 December 2020: £174,155)

Transactions with key management personnel of the Group

             Key Management Personnel are defined as member of the Group's Strategic Board.

             See Note 5 (Directors and employees) for details of compensation of key management personnel. Certain employees hold shares in the Group, including Key Management Personnel.

19.       Post balance sheet events

The contingent consideration of £1,000,000 was repaid to shareholders of Pod Point Holding Limited on 11 February 2022 as detailed in Note 12.1.

20.       Ultimate parent undertaking and controlling party

             The immediate parent company of the Company and its subsidiaries is EDF Energy Customers Limited , a company registered in the United Kingdom.

             The immediate parent company of EDF Energy Customers Limited  is EDF Energy Limited, a company registered in the United Kingdom.

             At 31 December 2021 and 31 December 2020, Électricité de France SA, a company incorporated in France, is regarded by the Directors as the Company's ultimate parent company and controlling party. This is the largest group for which consolidated financial statements are prepared. Copies of that company's consolidated financial statements may be obtained from the registered office at Électricité de France SA, 22-30 Avenue de Wagram, 75382, Paris, Cedex 08, France.