Final Results, Notice of AGM and Publication of AR

Company Statement of Changes in Equity

For the five months ended 31 December 2020

 

	Share Capital	Share premium	Share-based payment reserve	Merger relief reserve	Retained   earnings	Total
	£	£	£	£	£	£
Balance at 1 January 2020	286	8,186,967	-	-	(8,155,571)	31,682
Profit and total comprehensive income for the period	-	-	-	-	63,418	63,418
Balance at 31 July 2020	286	8,186,967	-	-	(8,092,153)	95,100
Bonus issues	4,911	(4,911)	-	-	-	-
Capital reduction	-	(8,182,057)	-	-	8,182,057	-
Issue of consideration shares	140,128	-	-	5,557,645		5,697,773
Issue of other shares	20,562	1,007,558	-	-	-	1,028,120
Costs of raising equity	-	(56,135)	-	-	-	(56,135)
Share-based payments	-	-	54,215	-	-	54,215
Loss and total comprehensive income for the period	-	-	-	-	(1,173,655)	(1,173,655)
	_______	_______	_______	_______	_______	_______
Balance at 31 December 2020	165,887	951,422	54,215	5,557,645	(1,083,751)	5,645,418
	_______	_______	_______	_______	_______	_______

 

 

Group and Company Cash Flow Statement

For the year ended 31 December 2020

 

		Group	Group	Company	Company
		Year ended 31 December 2020	9-month period ended 31 December 2019	5-month period ended 31 December 2020	7-month period ended 31 July 2020
		£	£	£	£
	Notes
Loss before tax		(2,154,698)	(81,549)	(1,173,655)	63,418
Adjustments to reconcile profit before tax to cash generated from operating activities:
Finance income	3	(603)	-	(603)	-
Finance costs	3	-	370	-	-
Share-based compensation	14	358,443	-	54,215	-
Depreciation and amortisation	8,9	22,270	3,656	16,638	26,541
(Increase)/decrease in accrued income, trade and other receivables		(83,297)	(120,731)	(370,302)	800,188
Increase/(decrease) in trade and other payables		1,000,240	96,290	1,069,655	(1,315,279)
		_______	_______	_________	_______
Cash used in operations		(857,645)	(101,964)	(404,052)	(425,132)
Income tax paid		-	-	-	-
		_______	_______	_________	_______
Cash used in operating activities		(857,645)	(101,964)	(404,052)	(425,132)
Investing activities
Acquisition of property, plant and equipment	9	(9,144)	-	-	-
Acquisition of intangible assets	8	(335,436)	-	(242,916)	-
		_______	_______	_________	_______
Cash used in investment activities		(344,580)	-	(242,916)	-
Financing activities
Shares issued (net of costs)	14	1,212,032	406,375	647,759	-
Repayment of shareholder loans		-	(381,300)	-	-
Loans received		95,000	-	95,000	-
Interest and similar income		603	-	603	-
Interest and similar charges		-	(370)	-
		_______	_______	__________	_______
Cash generated from financing activities		1,307,635	24,705	743,362	-
Increase/(decrease) in cash and cash equivalents		105,410	(77,259)	96,394	(425,132)
Opening cash and cash equivalents		78,265	155,524	-	425,132
		_______	_______	________	_______
Closing cash and cash equivalents		183,675	78,265	96,394	-
		=====================	=====================	=====================	=====================

 

 

Notes to the Financial Statements

For the year ended 31 December 2020

 

BAsis of preparation

 

Cornerstone FS plc is a public limited company, incorporated and domiciled in England. The Company was admitted to AIM, London Stock Exchange's market for small and medium size growth companies, on 6 April 2021. The registered office of the Company is The Old Rectory, Addington, Buckingham, England, MK18 2JR, and its principal business address is 1 Poultry, London, EC2R 8EJ. The main activities are set out in the Strategic Report on pages 2-14 of the annual report and accounts.

 

These financial statements have been prepared in accordance with International Financial Reporting Standards as adopted by the European Union ("IFRS") for the year ended 31 December 2020 and the comparative 9-month period to 31 December 2019, and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS. The financial statements have been prepared in sterling, which is the Group's presentation currency and the functional currency of each Group entity. They have been prepared using the historical cost convention except for the measurement of certain financial instruments.

 

The parent company accounts have also been prepared in accordance with IFRS and using the historical cost convention. The accounting policies set out below have been applied consistently to the parent company where applicable.

 

Monetary amounts in these financial statements are rounded to the nearest pound.

 

The preparation of the financial statements requires management to make estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the disclosure of contingent liabilities at the date of the financial statements. If in the future such estimates and assumptions, which are based on management's best judgement at the date of the financial statements, deviate from the actual circumstances, the original estimates and assumptions will be modified as appropriate in the year in which the circumstances change. 

 

NEW STANDARDS AND INTERPRETATIONS

As of the date of approval of these financial statements, the following Standards and Interpretations which have not been applied in these financial statements were in issue but not yet effective:

 

•              IFRS 17 Insurance Contracts (effective p/c on or after 1 January 2021).

•              Amendments to IAS 1, presentation of financial statements on classification of liabilities (effective p/c on or after 1 January 2022).

 

Some of these standards and amendments have not yet been endorsed by the EU which may cause their effective dates to change.

 

The Directors anticipate that the adoption of these Standards and Interpretations in future periods will have no material impact on the financial statements of the Group. The Group does not intend to apply any of these pronouncements early.

 

IMPACT OF NEW INTERNATIONAL REPORTING STANDARDS, AMENDMENTS AND INTERPRETATIONS

The following Standards and Interpretations have been considered and applied in these financial statements:

 

•              IFRIC 23 Uncertainty over Income Tax Positions

•              Amendments to IFRS 9 Prepayment Features with Negative Compensation

•              Amendments to IAS 28 Long-term interests in Associates and Joint Ventures

•              IFRS 16 Leases

 

There has been no material impact on the financial statements as a result of adopting these Standards and Interpretations.

 

Basis of consolidation

The consolidated financial statements incorporate the financial statements of the Company and its subsidiary undertakings. Entities are accounted for as subsidiary undertakings when the Group is exposed to or has rights to variable returns through its involvement with the entity and it has the ability to affect those returns through its power over the entity.

 

Details of subsidiary undertakings and % shareholding:

FXPress Payment Services Ltd           - 100% owned by the Company

Avila House Limited                             - 100% owned by FXPress Payment Services Ltd

CS Commercial Limited                       - 100% owned by the Company

Cornerstone EBT Trustee Limited     - 100% owned by the Company

 

All subsidiary undertakings have an accounting reference date ended 31 December.

 

Although the consolidated financial information has been issued in the name of Cornerstone FS plc ("Cornerstone"), the legal parent, it represents in substance continuation of the financial information of the primary legal subsidiary, FXPress Payment Services Ltd.

 

The assets and liabilities of the primary legal subsidiary are recognised and measured in the consolidated financial statements at the pre-combination carrying amounts and not re-stated at fair value.

 

The retained earnings and reserves balances recognised in the consolidated financial statements reflect the retained earnings and other reserves of the primary legal subsidiary immediately before the business combination and the results of the period from 1 January 2020 to the date of the business combination are those of the primary legal subsidiary only.

 

As FXPress Payment Services Ltd reversed into Cornerstone when Cornerstone did not have an existing trade, the transaction cannot be considered a business combination, as at the time of the reverse takeover, Cornerstone did not meet the definition of a business, under IFRS 3 "Business Combinations". As the transaction is capital in nature and completed through the issue of shares, it falls within the scope of IFRS 2 'Share-based payments'. Any difference in the fair value of shares deemed to be issued by the legal subsidiary (FXPress Payment Services Ltd) and the fair value of net identifiable assets in the legal parent (Cornerstone FS plc) forms part of the deemed cost of acquisition.

 

GOING CONCERN

During the year ended 31 December 2020, the Group made a loss of £2,154,698, which has resulted in the balance sheet showing a net liabilities position of £135,923. Post year-end, the Group's balance sheet was strengthened with the raising of gross proceeds of £2.2m via a placing of new ordinary shares following the Company's admission to AIM. The Group also has access to £450,000 in convertible loan note facilities.

 

The Directors have prepared a cash flow forecast covering a period extending 24 months from 31 December 2020. The Directors have taken into account the placing proceeds mentioned above, the historical growth and the inherent risks and uncertainties facing the Group's business, and have derived forecast assumptions that are their best estimate of the future development of Group's business. The Directors have also run various scenario planning forecasts alongside their best-estimate forecast assumptions, which all indicate sufficient cash resources to continue to finance the Group's working capital requirements over the forecast period.

 

The Directors are mindful of COVID-19 and the impact that this has had on operations is discussed further in note 20. The Board have reviewed forecasts in light of this and do not consider there to be any material uncertainties pertaining to the Group's ability to discharge its liabilities as they arise.

 

For these reasons, the Directors continue to adopt the going concern basis of accounting in preparing the Group's financial statements.

 

 

 

 

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

revenue

The Group applies IFRS 15 Revenue from Contracts with Customers for the recognition of revenue. IFRS 15 established a comprehensive framework for determining whether, how much and when revenue is recognised. It affects the timing and recognition of revenue items, but not generally the overall amount recognised.

 

The performance obligations of the Group's revenue streams are satisfied on the transaction date or by the provision of the service for the period described in the contract. Revenue is not recognised where there is evidence to suggest that customers do not have the ability or intention to pay. The Group does not have any contracts with customers where the performance obligations have not been fully satisfied.

 

The Group derives revenue from the provision of foreign exchange and payment services. When a contract with a client is entered into, it immediately enters into a separate matched contract with its institutional counterparty.

 

Spot and forward revenue is recognised when a binding contract is entered into by a client and the rate is fixed and determined. Revenue represents the difference between the rate offered to clients and the rate received from its institutional counterparties.

 

INVESTMENTS

Investments in subsidiary undertakings are accounted for at cost less impairment.

 

FINANCIAL INSTRUMENTS

Financial assets and financial liabilities are recognised on the Group Statement of Financial Position when the Group has become a party to the contractual provisions of the instrument.

Derivative financial instruments

Derivative financial assets and liabilities are carried as assets when their fair value is positive and as liabilities when their fair value is negative. Changes in the fair value of derivatives are included in the income statement. The Group's derivative financial assets and liabilities at fair value through profit or loss comprise solely of forward foreign exchange contracts.

Trade, loan and other receivables

Trade and loan receivables are initially measured at their transaction price. Trade and loan receivables are held to collect the contractual cash flows which are solely payments of principal and interest. Therefore, these receivables are subsequently measured at amortised cost using the effective interest rate method. The Directors have considered the impact of discounting trade and loan receivables whose settlement may be deferred for lengthy periods and concluded that the impact would not be material.

 

An impairment loss is recognised for the expected credit losses on trade and loan receivables when there is an increased probability that the counterparty will be unable to settle an instrument's contractual cash flows on the contractual due dates, a reduction in the amounts expected to be recovered, or both.

 

Impairment losses and any subsequent reversals of impairment losses are adjusted against the carrying amount of the receivable and are recognised in profit or loss.

Trade payables

Trade payables are initially recognised at fair value and subsequently at amortised cost using the effective interest method.

Equity instruments

Equity instruments issued by the Group are recorded at the proceeds received, net of direct issue costs.

Financial liabilities

Financial liabilities are classified according to the substance of the contractual arrangements entered into. An instrument will be classified as a financial liability when there is a contractual obligation to deliver cash or another financial asset to another enterprise.

Cash and cash equivalents

Cash and cash equivalents comprise cash in hand, deposits held at call with banks and other short-term highly liquid investments with original maturities of three months or less.

For the purposes of the Cash Flow Statement, cash and cash equivalents consist of cash and cash equivalents as defined above, net of any outstanding bank overdraft which is integral to the Group's cash management.

 

INTANGIBLE aSSETS

An intangible asset, which is an identifiable non-monetary asset without physical substance, is recognised to the extent that it is probable that the expected future economic benefits attributable to the asset will flow to the Group and that its cost can be measured reliably. The asset is deemed to be identifiable when it is separable or when it arises from contractual or other legal rights.

 

Amortisation is charged on a straight-line basis through the profit or loss within administrative expenses. The rates applicable, which represent the Directors' best estimate of the useful economic life, are as follows:

 

Internally developed software          - 3 years

Software costs                                      - 3 years

Other intangible assets                       - 3 years (no charge in the first period of ownership)

 

property, plant and equipment

All property, plant and equipment is initially recorded at cost and is subsequently measured at cost less accumulated depreciation and any recognised impairment loss.

 

Depreciation, which is charged through the profit or loss within administrative expenses, is provided at rates calculated to write off the cost less residual value of each asset over its expected useful life, as follows:

 

Computer equipment                                - 25% straight line

 

The gain or loss arising on the disposal or retirement of an asset is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognised in profit or loss.

 

PROVISIONS

Provisions are recognised when the Group has a present obligation as a result of a past event which it is probable will result in an outflow of economic benefits that can be reliably estimated.

 

SHARE CAPITAL

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares are shown in share premium as a deduction from the proceeds.

 

SHARE-BASED COMPENSATION

Where share options are awarded to employees, the fair value of the options at the date of grant is charged to the income statement over the vesting period. Non-market vesting conditions are taken into account by adjusting the number of equity instruments expected to vest at each balance sheet date so that, ultimately, the cumulative amount recognised over the vesting period is based on the number of options that eventually vest. Market vesting conditions are factored into the fair value of the options granted.

 

As long as all other vesting conditions are satisfied, a charge is made irrespective of whether the market vesting conditions are satisfied. The cumulative expense is not adjusted for failure to achieve a market vesting condition.

 

Where the terms and conditions of options are modified before they vest, the increase in the fair value of the options, measured immediately before and after the modification, is also charged to the income statement over the remaining vesting period. Where equity instruments are granted to persons other than employees, the income statement is charged with fair value of goods and services received.

 

Cancelled or settled options are accounted for as an acceleration of vesting and the amount that would have been recognised over the remaining vesting period is recognised immediately.

The proceeds received net of any attributable transaction costs are credited to share capital (nominal value) and share premium when the options are exercised.

 

Fair value is measured by use of the Black-Scholes pricing model which is considered by management to be the most appropriate method of valuation.

 

employee benefits

The Group operates a defined contribution pension scheme. The pension costs charged in the financial statements represent the contribution payable by the Group during the year.

 

The costs of short-term employee benefits are recognised as a liability and an expense in the period the related service is rendered at the undiscounted amount of the benefits expected to be paid in exchange for that service.

 

TAXATION

Current income tax assets and liabilities are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted at the reporting date. Current income tax relating to items recognised directly in equity or other comprehensive income is recognised in equity and not in the consolidated statement of comprehensive income.

 

Deferred income tax is provided on all temporary differences at the reporting date arising between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes. Deferred tax assets and liabilities are offset when the Group has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

 

Deferred tax assets have not been recognised in respect of the Group's tax losses carried forward.

 

Research and Development tax credits are not recognised as receivables until the claims have been submitted and agreed by HMRC.

 

CRITIAL ACCOUNTING ESTIMATES AND JUDGEMENTS

 

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

 

The Group makes estimates and assumptions concerning the future. The resulting accounting judgements will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.

 

IMPAIRMENT

At each accounting reference date, the Group reviews the carrying amounts of its intangibles, property, plant and equipment to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any).

 

Where the asset does not generate cash flows that are independent from other assets, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs. An intangible asset with an indefinite useful life is tested for impairment annually and whenever there is an indication that the asset may be impaired.

 

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

 

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

 

Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried in at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

 

SHARE-BASED COMPENSATION

The fair value of share-based awards is measured using the Black-Scholes model which inherently makes use of significant estimates and assumptions concerning the future applied by the Directors. Such estimates and judgements include the expected life of the options and the number of employees that will achieve the vesting conditions. Further details of the share option scheme are given in note 14.

 

ALTERNATIVE PERFORMANCE MEASURES

 

The Group uses the alternative performance measure of underlying profit/(loss) from operations. This measure is not defined under IFRS, nor is it a measure of financial performance under IFRS.

 

This measure is sometimes used by investors to evaluate a company's operational performance with a long-term view towards adding shareholder value. This measure should not be considered an alternative, but instead supplementary, to profit/(loss) from operations and any other measure of performance derived in accordance with IFRS.

 

Alternative performance measures do not have generally accepted principles for governing calculations and may vary from company to company. As such, the underlying profit/(loss) from operations quoted within the Group Statement of Comprehensive Income should not be used as a basis for comparison of the Group's performance with other companies.

 

UNDERLYING PROFIT/(LOSS) FROM OPERATIONS

The Group uses underlying profit/(loss) from operations, defined as profit/(loss) from operations, adding back share-based compensation and transaction costs associated with the Group's AIM listing and acquisitions strategy.

 

The underlying loss from operations is reconciled back to the loss from operations within the Group Statement of Comprehensive Income.

 

1              revenue and SEGMENTAL REPORTING

 

                 All of the Group's revenue arises from activities within the UK. Management considers there to be only one operating segment within the business based on the way the business is organised and the way results are reported internally.

                

Revenue is as follows:

 

	Group	Group
	Year ended 31 December 2020	9-month period ended 31 December 2019
	£	£
	_______	_______
Total revenue	1,664,237	1,240,938
	_______	_______

 

 

	Group	Group
	Year ended 31 December 2020	9-month period ended 31 December 2019
2              LOSS FROM OPERATIONS	£	£
Loss from operations is stated after charging:
Share-based compensation on reverse acquisition	211,281	-
Other share-based compensation	147,162	-
Transaction costs	793,577	-
Expensed software development costs	42,333	43,000
Depreciation of property, plant and equipment	1,730	729
Amortisation of intangible assets	20,540	2,926
Short-term (2018 IAS 17 operating) lease rentals	70,697	69,992
	_______	_______

 

Amounts payable to the Group's auditor in respect of both audit and non-audit services:

 

	Year ended 31 December 2020	9-month period ended 31 December 2019
	£	£
Audit Services
-   Statutory audit	15,000	-
Other Services
The auditing of accounts of associates of the Company pursuant to legislation:
-   Audit of subsidiaries and its associates	16,500	8,000
	-------------------------	-------------------------
	31,500	8,000
	=========================	=========================

 

 

 

 

	Group	Group
3              INTEREST AND SIMILAR ITEMS	Year ended 31 December 2020	9-month period ended 31 December 2019
	£	£
i.      Total finance and other income	603	-
	_______	_______
ii.     Total finance costs	-	370
	_______	_______

 

4              Employees
The average monthly numbers of employees in the Group (including the Directors) during the year was made up as follows (the Company has no employees other than the Directors):
	Year ended 31 December 2020	9-month period ended 31 December 2019
	Number	Number
Directors	-	-
Employees	9	6
	_______	_______
	9	6
	_______	_______

 

Employment costs		Year ended 31 December 2020	9-month period ended 31 December 2019
		£	£
Wages and salaries		618,522	135,557
Social security costs		68,455	13,899
Pension costs		5,930	4,073
Share-based compensation		26,787	-
		_______	_______
		719,694	153,529
		_______	_______
remuneration of key management personnel
The remuneration of the Directors, who are the key management personnel of the Group, is set out below in aggregate. Further information about the remuneration of the individual directors is provided in the Directors' Remuneration Report on pages 24-26 of the annual report and accounts.
		Year ended 31 December 2020	9-month period ended 31 December 2019
		£	£
Salaries and fees		116,786	-
Share-based compensation		20,088	-
Social security costs		9,453	-
		_______	_______
		146,327
		_______	_______
		Number	Number
Number of Directors to whom retirement benefits are accruing under a defined contribution scheme		-	-
		Year ended 31 December 2020	9-month period ended 31 December 2019
		£	£
	The remuneration in respect of the highest paid Director was:
	Salaries and fees	85,000	-
	Share-based compensation	15,452	-
	Social security costs	5,580	-
		_______	_______
		106,032	-
		_______	_______

 

During the year no (2019: nil) Directors exercised any (2019: nil) share options.

 

5              Pension costs

 

The Group operates a defined contribution pension scheme. The scheme and its assets are held by independent managers. The pension charge represents contributions due from the Group and amounted to £5,930 (2019: £4,070). At 31 December 2020 contributions of £2,490 remained outstanding and are included within other payables (31 December 2019: £543).

 

6              taxation

 

The tax on the loss on ordinary activities for the period was as follows:

 

	Group	Group
	Year ended 31 December 2020	9-month period ended 31 December 2019
	£	£
	_______	_______
Current Tax:
UK Corporation tax	-	-
Deferred tax	-	-
	_______	_______
Tax on loss on ordinary activities	-	-
	_______	_______
	Group	Group
	Year ended 31 December 2020	9-month period ended 31 December 2019
	£	£
Loss before taxation	(2,154,698)	(81,549)
	_______	_______
Loss multiplied by main rate of corporation tax in the UK of 19% (9-month ended 31 December 2019: 19%)	(409,393)	(15,494)
Effects of:
Expenses not deductible for tax purposes	155,158	656
Share-based payments	68,104	-
Other deductions in period	(1,446)	-
Tax losses carried forward	185,577	14,838
	_______	_______
Current tax	-	-
	_______	_______

 

As at 31 December 2020, the Group had prepared but not yet submitted a Research and Development tax credits reclaim, the estimated net benefit of which is approximately £62,000. It has not been recognised as an asset due to its contingent nature.

 

As at 31 December 2020, the Group had tax losses carried forward of £2,847,347 (31 December 2019: £1,860,098). Deferred tax has not been recognised in respect of these tax losses. The standard rate of corporation tax applicable to the Group for the year ended 31 December 2020 was 19.0%. The UK government has indicated that the rate of corporation tax may be increased to 25% with effect from 1 April 2023.

 

7              LOSS PER SHARE

 

The loss per share of 14.99p is based upon the loss of £2,154,698 (2019: loss of £81,549) and the weighted average number of ordinary shares in issue for the year of 14,370,030 (2019: 11,221,348).

 

The loss incurred by the Group means that the effect of any outstanding warrants and options would be considered anti-dilutive and is ignored for the purposes of the loss per share calculation.

                                                 

 

8             GROUP INTANGIBLE ASSETS

 

	Internally developed software	Software costs	Other	Total
	£	£	£	£
COST
At 1 January 2020	-	15,611	-	15,611
Additions	242,916	-	-	242,916
Acquired through business combination	-	-	92,520	92,520
	_______	_______	_______	_______
At 31 December 2020	242,916	15,611	92,520	351,047
AMORTISATION
At 1 January 2020	-	9,535	-	9,535
Charge for the period	16,638	3,902	-	20,540
	_______	_______	_______	_______
At 31 December 2020	16,638	13,437	-	30,075
NET BOOK VALUE
At 31 December 2020	226,278	2,174	92,520	320,972
	_______	_______	_______	_______
At 31 December 2019	-	6,076	-	6,076
	_______	_______	_______	_______

 

Other intangible assets comprise regulatory licenses held at cost and are not amortised in the first period of ownership.

 

Company INTANGIBLE ASSETS

	Internally developed software	Software costs	Other	Total
	£	£	£	£
COST
At 1 August 2020	-	-	-	-
Additions	242,916	-	-	242,916
	_______	_______	_______	_______
At 31 December 2020	242,916	-	-	242,916
AMORTISATION
At 1 August 2020	-	-	-	-
Charge for the period	16,638	-	-	16,638
	_______	_______	_______	_______
At 31 December 2020	16,638			16,638
NET BOOK VALUE
At 31 December 2020	226,278	-	-	226,278
	_______	_______	_______	_______
At 31 July 2020	-	-	-	-
	_______	_______	_______	_______

 

 

 

 

9             GROUP property, plant and equipment

 

	Computer Equipment £
COST At 1 January 2020 Additions     At 31 December 2020		6,531 9,144     15,675
DEPRECIATION At 1 January 2020 Charge for the period     At 31 December 2020		5,481 1,730     7,211
NET BOOK VALUE At 31 December 2020		8,464
At 31 December 2019		1,050

10           investments

 

	Investments in Subsidiaries £
Cost or Valuation At 1 August 2020 Additions Disposals     At 31 December 2020		100 6,147,773 (100)     6,147,773
Net Book value At 31 December 2020		6,147,773
At 31 July 2020		100

 

The Company's investment as at 31 December 2020 represents the initial investment in FXPress Payment Services Ltd on 9 September 2020 and a further £450,000 invested on 31 December 2020.

 

On 9 September 2020, the Company acquired the entire issued share capital of FXPress Payment Services Ltd ("legal subsidiary") for a consideration of £5,697,773, satisfied by the issue of 1,401,275,638 shares.

 

Prior to the acquisition, on 7 July 2020, the legacy business and trade of Cornerstone (formerly Cornerstone Brands, a consumer product business) together with its trade, assets and liabilities, was hived down to a newly incorporated wholly-owned subsidiary, CSTT Limited ("CSTT"). Cornerstone's investment in CSTT, stated at cost, was £100. The disposal of CSTT to the prior owners of the legacy business was approved by shareholders at a general meeting on 26 August 2020 and completed on 9 September 2020.

 

As the legal subsidiary reversed into the Company ("legal parent"), without an existing trade, this transaction cannot be considered a business combination, as the legal parent did not meet the definition of a business, under IFRS 3 "Business Combinations".

 

As the transaction is capital in nature and completed through the issue of shares it falls within the scope of IFRS 2 'Share-based payments'. Any difference in the fair value of shares deemed to be issued by the legal subsidiary and the fair value of net identifiable assets in the legal parent will form part of the deemed cost of acquisition.

 

Shares in subsidiary and associate undertakings are stated at cost. As at 31 December 2020, Cornerstone FS plc owned the following principal subsidiaries which are included in the consolidated accounts:

 

Subsidiary	Principal Activity	Country of Incorporation	Registered Office	Percentage of Ownership
FXPress Payment Services Ltd	Foreign Exchange and Payment Services	Northern Ireland	1 Elmfield Avenue, Warrenpoint, Newry, Co. Down, BT34 3HQ	100 per cent.
Avila House Limited	E-money and Payment Services	England and Wales	The Old Rectory, Addington, Buckinghamshire, MK18 2JR	100 per cent.
CS Commercial Limited (audit exempt)	Dormant	England and Wales	The Old Rectory, Addington, Buckinghamshire, MK18 2JR	100 per cent.
Cornerstone EBT Trustee Limited (audit exempt)	Employee Benefit Scheme Trustee	England and Wales	The Old Rectory, Addington, Buckinghamshire, MK18 2JR	100 per cent.

 

11           Avila House acquisition

 

On 19 October 2020 FXPress Payment Services Ltd acquired the entire issued share capital of Avila House Limited ("Avila House"), a company which has a small electronic money institution licence focused on multi-currency e-wallets, for a total consideration of £92,685 (satisfied by £60,000 in shares and £32,685 in cash). The acquisition was made in line with the Group's strategy to allow clients to leave funds on deposit, effectively providing them with multi-currency current accounts.

 

The Group determined that the activities and assets acquired represent a business as defined under IFRS 3 Business Combinations and has accounted for the transaction accordingly.

 

The net assets acquired at the date of acquisition were determined to be £92,520, representing the fair value of the FCA registered small electronic money institution licence, which was the only asset held by Avila House at the time of acquisition.

 

No goodwill arose as a result of the acquisition.

 

Since the acquisition date, Avila House has not generated any revenue (also in line with the Group's product development roadmap) and generated a loss of £3,822, which is included in the consolidated financial statements.

 

 

12           current trade and other receivables

 

	Group	Group	Company	Company
	31 December 2020	31 December 2019	31 December 2020	31 July 2020
	£	£	£	£
Trade receivables	8,405	7,720	-	-
Prepayments and accrued income	24,623	-	9,600	-
Derivative financial assets at fair value	299,035	281,134	-	-
Other receivables	140,378	66,516	131,492	-
Amounts due from Group undertakings and undertakings in which the Company has a participating interest	-	-	-	95,000
Taxes and social security	97,718	-	97,718	-
	_______	_______	_______	_______
	570,159	355,370	238,310	95,000
	_______	_______	_______	_______

 

For the year ended 31 December 2020, £nil was recorded as a bad debt expense (nine-month period ended 31 December 2019: £nil).

 

As at 31 December 2020, the Group had a contingent asset in respect of Research and Development tax credits for which a reclaim had been prepared, but not yet submitted (31 December 2019: £nil). The estimated net benefit of the claim is approximately £62,000 and has not been included in current receivables due to its contingent nature.

 

13            current trade and other payables

 

	Group	Group	Company		Company
	31 December 2020	31 December 2019	31 December 2020		31 July 2020
	£	£	£		£
Trade payables	525,064	101,577	238,654		-
Derivative financial liabilities at fair value	216,061	249,989	-		-
Other tax and social security	47,273	5,458	17,411		-
Other payables and accruals	430,795	17,953	290,773		-
Amount due to Group undertakings	-	-	516,999		-
	_______	_______	_______		_______
	1,219,193	374,977	1,063,837		-
	_______	_______	_______		_______

 

 

14           Share capital AND Reserves

 

Allotted, called up and fully paid
	Ordinary shares	Share capital
	No.	£
Ordinary shares of £0.00001 each as at 1 August 2020	28,597,462	286
Bonus issue of £0.00001 shares 9 August 2020	257,377,158	2,573
Consolidation to £0.0001 9 August 2020	(257,377,158)	-
Issue of consideration shares of £0.0001 9 September 2020	1,401,275,638	140,128
Bonus issue of £0.0001 shares 10 September 2020	23,363,722	2,336
Issue of new shares of £0.0001 16 September 2020	13,438,678	1,344
Consolidation to £0.01 shares 2 October 2020	(1,452,008,745)	-
Issue of new shares of £0.01 October to December 2020	1,921,853	19,219
	_______	_______
Ordinary shares of £0.01 each at 31 December 2020	16,588,608	165,886
	_______	_______

 

At 31 December 2020 share subscriptions of £131,492, comprising £2,630 share capital and £128,862 share premium, remained unpaid (31 July 2020: £nil).

 

The following changes in the share capital of the Company have taken place in the five-month period ended 31 December 2020:

 

•      On 26 August 2020, the Company issued 9 bonus shares for every share in issue and subsequently consolidated such shares, in respect of each relevant class of shares, on the basis of 10 shares of £0.00001 each into 1 share of £0.0001 each;

•      on 9 September 2020, 1,401,275,638 new A ordinary shares of £0.0001 each were issued as consideration shares to FXPress Payment Services Ltd shareholders pursuant to the acquisition;

•      on 10 September 2020, 23,363,722 new bonus E ordinary shares of £0.0001 each were issued;

•      on 16 September 2020, 13,438,598 new A ordinary shares of £0.0001 each were issued at a price of £0.005 each and 80 new A ordinary shares of £0.0001 each were issued for the purposes of ensuring there would be a whole number of shares in issue upon the proposed consolidation on 2 October 2020;

•      on 2 October 2020, the entire issued share capital of the Company comprising different classes of shares were re-designated and consolidated on the basis of 100 shares of £0.0001 each into 1 Ordinary Share of £0.01 each;

•      on 3 October 2020, 1,390,018 Ordinary Shares were issued at a price of £0.50 each and 211,835 Ordinary Shares were issued in consideration for services at an equivalent price of £0.50 per share;

•      on 19 October 2020, 120,000 Ordinary Shares were issued as consideration shares to the shareholders of Avila House in accordance with the terms of the share purchase agreement; and

•      on 1 December 2020, 200,000 Ordinary Shares were issued at a price of £0.50 each.

 

All Ordinary Shares are equally eligible to receive dividends and the repayment of capital and represent equal votes at meetings of shareholders.

 

As at 31 December 2020, £131,492 of issued share capital was unpaid (31 December 2019: £26,247).

 

The following describes the nature and purpose of each reserve within owner's equity:

Share capital: Amount subscribed for shares at nominal value.

Share premium: Amount subscribed for share capital in excess of nominal value, less costs of share issue.

Share-based payment reserve: The share-based payment reserve comprises the cumulative expense representing the extent to which the vesting period of warrants and share options has passed and management's best estimate of the achievement or otherwise of non-market conditions and the number of equity instruments that will ultimately vest.

Merger relief reserve: Effect on equity of the consideration shares issued over their nominal value.

Reverse acquisition reserve: Effect on equity of the reverse acquisition of FXPress Payment Services Ltd.

Retained losses: Cumulative realised profits less cumulative realised losses and distributions made, attributable to the equity shareholders of the Company.

 

Options

 

The Company operates an Enterprise Management Inventive ("EMI") Scheme equity-settled share-based remuneration scheme for employees. 

 

Each of the option agreements under the EMI scheme provides that the relevant options vest, as to one third of the shares comprised in them, on each of the first three anniversaries of the date of grant. Once vested, the options are exercisable at any time. The options are also exercisable in the event of a change of control. If the optionholder's employment within the Group is terminated, other than for gross misconduct, any options vested may be exercised within 90 days of such termination (12 months in the case of the optionholder's death). Otherwise the options lapse five years after the date of grant. The options also lapse, inter alia, if the optionholder is adjudged bankrupt or proposes a voluntary arrangement or other scheme in relation to his/her debts.

 

	Ordinary shares	Weighted average exercise price
	No.	£
Outstanding as at 1 August 2020	-	-
Granted during the period	1,599,480	0.50
	_______	_______
Outstanding as at 31 December 2020	1,599,480	0.50
	_______	_______

 

On 2 December 2020 Julian Wheatland was granted options over 922,677 Ordinary Shares at an exercise price of £0.50 per share. The Company has also agreed to make an annual grant of additional options to Julian Wheatland equal to 5% of any increase in the fully diluted capital of the Company which has occurred in the 12 months immediately prior to the date of grant to be exercisable at a price equal to the average mid-market closing price of the Ordinary Shares over the relevant 12-month period.

 

On 2 December 2020 Judy Happe was granted options over 276,803 Ordinary Shares at an exercise price of £0.50 per share. The Company has also agreed to make an annual grant of additional options to Judy Happe equal to 1.5% of any increase in the fully diluted capital of the Company which has occurred in the 12 months immediately prior to the date of grant to be exercisable at a price equal to the average mid-market closing price of the Ordinary Shares over the relevant 12-month period.

 

On 2 December 2020 a further 400,000 options were granted to other senior employees at an exercise price of £0.50 per share.

 

 

The Black-Scholes model was used for calculating the cost of options. The model inputs for the options issued were:

 

           Grant date                             - 2 December 2020

           Share price at grant date    - 50 pence

           Exercise price                       - 50 pence

           Risk free rate                        - 0.8%

           Expected volatility               - 83.7% (based on reference to the Group's quoted competitors)

           Contractual life                     - 5 years

 

Market performance conditions were ignored in determining the fair value of options.

The weighted average contractual life of the options is five years (2019: zero).

No options were exercised during the current year (2019: nil).

 

Warrants

 

Between 15 January 2020 and 31 March 2020 FXPress Payment Services Ltd granted 14,911,060 warrants to various advisors, employees and directors with an average exercise price of £0.050 and a term of five years. Due to failure to satisfy a vesting condition specified at the grant date, the fair value of 9,155,930 warrants issued to employees and ex-employees was assessed to be zero.

 

The remaining 5,755,130 warrants were estimated to have an average fair value of £0.016 per warrant at the grant date using the Black-Scholes valuation model.  The principal inputs into the model were:

 

Share price at grant date               - between 4.7 pence and 5.5 pence

Risk-free rate                                   - 0.75%

Expected Volatility                          - 25%

Contractual life                                - 5 years

 

In connection with the reverse acquisition of the Company on 9 September 2020, the Directors of Cornerstone wrote to the holders of the 9,155,930 outstanding FXPress Payment Services Ltd warrants, agreeing to exchange their warrants for warrants in Cornerstone in return for waiving all rights under their FXPress Payment Services Ltd warrants. 

 

As a result of the effective cancellation of the FXPress Payment Services Ltd warrants, FXPress Payment Services Ltd recognised an accelerated share-based payment charge of £92,947 for the year-ended 31 December 2020 (9 months ended 31 December 2019: £nil).

 

On 3 October 2020 Cornerstone granted 778,460 warrants to the former holders of FXPress Payment Services Ltd warrants with an average exercise price of £0.31 and an average term of four years and 117 days. Between 5 October 2020 and 10 December 2020 Cornerstone granted 1,000,000 warrants with an exercise price of £0.50 and a term of five years. The Cornerstone warrants were estimated to have an average grant date fair value of £0.342 per warrant using the Black-Scholes valuation model.  The principal inputs into the model were:

 

Share price at grant date               - between 16.6 pence and 50 pence

Risk-free rate                                   - 0.8%

Expected volatility                           - 83.7%

Contractual life                                - between 4 years & 105 days and 5 years

 

The Group share-based compensation charge for the year ended 31 December 2020 of £147,162 (9-month period ended 31 December 2019: £nil) consists of £92,947 in relation to the accelerated share-based payment charges in respect of the cancelled warrants in FXPress Payment Services Ltd, £27,428 in respect of the replacement warrants granted in Cornerstone and £26,787 in respect of the Cornerstone options. 

 

15           Related party transactions

 

Details of key management compensation are included in note 4. Key management are considered to be the Directors of the Group. 

 

Transactions with subsidiaries

During the year, the Company and FXPress Payment Services Ltd entered into various transactions with each other including software development charges, licenses fees and working capital support. The net balance of transactions between the companies are held on an interest free inter-Group loan which has no terms for repayment. At the year end, the Company owed £516,999 (2019: £nil) to FXPress Payment Services Ltd.

 

Other related parties:

 

All of the amounts below were in respect of the year ended 31 December 2020.

 

Fees of £50,000 (2019: £nil) in connection with fundraising activities were due to LGEC Capital Partners LLP, of which Gareth Edwards is a Designated Member. The amount was unpaid at the year-end.

 

Corporate finance advisory fees of £49,323 were due to London Bridge Capital Limited, a company of which Gareth Edwards and Elliott Mannis are directors and Elliott Mannis is the shareholder.  £36,135 remained due to London Bridge Capital Limited at the year-end (2019: £nil).

 

Terry Everson, a director of FXPress Payment Services Ltd and a significant shareholder in Cornerstone, was paid consulting fees of £24,000 via Hazelwood Financial Ltd, a company of which he is a director and significant shareholder (9 months ended 31 December 2019: £54,000). As at 31 December 2020, a loan of £10,000 made by the Group to Terry Everson remained unpaid (31 December 2019: £nil).

 

William Newton, a director of FXPress Payment Services Ltd and a significant shareholder in Cornerstone, was paid consulting fees of £8,333 (9 months ended 31 December 2019: £21,000).

 

Stephen Flynn, a director of FXPress Payment Services Ltd and a significant shareholder in Cornerstone, was paid consulting fees of £68,871 via JF Technology (UK) Ltd, a company of which he is a director and significant shareholder (9 months ended 31 December 2019: £21,500).

 

David Mason, a director of FXPress Payment Services Ltd, was paid consulting fees of £85,800 (9 months ended 31 December 2019: £nil).

 

Jason Conibear, a former director of FXPress Payment Services Ltd, was paid consulting fees of £42,650 (9 months ended 31 December 2019: £15,000).

 

 

 

 

 

 

 

 

 

 

 

 

 

16            FINANCIAL INSTRUMENTS

 

                FINANCIAL ASSETS

 

	Group	Group	Company		Company
	31 December 2020	31 December 2019	31 December 2020		31 July 2020
	£	£	£		£
DERIVATIVE FINANCIAL ASSETS
Foreign currency forward contracts with customers	253,077	182,117	-		-
Foreign currency forward contracts with institutional counterparty	45,958	99,017	-		-
	_______	_______	_______		_______
	299,035	281,134	-		-
Cash and cash equivalents	183,675	78,265	96,394		-
Trade receivables	8,405	7,720	-		-
Other receivables	165,001	66,516	141,092		95,000
	_______	_______	_______		_______
	656,116	433,655	237,486		95,000
	_______	_______	_______		_______

 

FINANCIAL LIABILITIES

 

	Group	Group	Company		Company
	31 December 2020	31 December 2019	31 December 2020		31 July 2020
	£	£	£		£
DERIVATIVE FINANCIAL LIABILITIES
Foreign currency forward contracts with customers	55,869	120,754	-		-
Foreign currency forward contracts with institutional counterparty	160,192	129,235	-		-
	_______	_______	_______		_______
	216,061	249,989	-		-
Trade payables	525,064	101,577	238,654		-
Other payables	430,795	17,953	807,772		-
	_______	_______	_______		_______
	1,171,920	369,519	1,046,426		-
	_______	_______	_______		_______

 

                All financial assets and liabilities have contractual maturity of less than one year.

 

 

Derivative financial assets and liabilities

 

                Derivative financial assets not designated as hedging instruments

 

	31 December 2020		31 December 2019
	Fair Value	Notional Principal	Fair Value		Notional Principal
	£	£	£		£
Foreign currency forward contracts with customers	253,077	14,686,425	182,117		4,986,924
Foreign currency forward contracts with institutional counterparty	45,958	5,785,633	99,017		4,971,285
	_______	_______	_______		_______
	299,035	20,472,058	281,134		9,958,209
	_______	_______	_______		_______

 

                Derivative financial liabilities not designated as hedging instruments

 

	31 December 2020		31 December 2019
	Fair Value	Notional Principal	Fair Value		Notional Principal
	£	£	£		£
Foreign currency forward contracts with customers	55,869	4,392,467	120,754		4,535,780
Foreign currency forward contracts with institutional counterparty	160,192	12,390,456	129,235		5,192,152
	_______	_______	_______		_______
	216,061	16,782,923	249,989		9,727,932
	_______	_______	_______		_______

 

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Foreign currency forward contracts are measured at fair value on a recurring basis.

 

There are three levels of fair value hierarchy:

·      Level 1 - the fair value of financial instruments traded in active markets is based on quoted market prices at the end of the reporting period.

·      Level 2 - valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable.

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

 

Foreign currency forward contracts with customers generally require immediate settlement on the maturity date of the individual contract and fall into level 2 of the fair value hierarchy above. Level 2 comprises those financial instruments which can be valued using inputs other than quoted prices that are observable for the asset or liability either directly (i.e. prices) or indirectly (i.e. derived from prices). The fair value of forward foreign exchange contracts is measured using observable forward exchange rates for contracts with a similar maturity at the reporting date.

 

The net gain on financial assets at fair value through profit or loss for year ended 31 December 2020 was £4,839 (9 months ended 31 December 2019: £13,250).

 

 

Financial instruments - risk management

 

Financial assets primarily comprise trade and other receivables, cash and cash equivalents and derivative financial assets. Financial liabilities comprise trade and other payables, shareholder loans and derivative financial liabilities. The main risks arising from financial instruments are market risk (including foreign currency risk and interest rate risk), liquidity risk, credit risk and counterparty risk.

 

Market risk

 

Market risk for the Group comprises foreign exchange risk and interest rate risk. The Group operates as a riskless matched principal broker for deliverable non-speculative spot and forward foreign currency transactions, with each trade with its clients matched with an identical trade with an institutional counterparty. Therefore, foreign exchange risk is mitigated through the matching of foreign currency assets and liabilities between clients and institutional counterparties which move in parity.

 

The Group's cash balances are primarily held in Pound Sterling and the Group does not hold significant cash balances in foreign currencies.

 

Interest rate risk affects the Group to the extent that it implicitly impacts the price of foreign currency forward contracts. However, this risk is mitigated in the same way as foreign currency risk.

 

Liquidity risk

 

Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Group has extensive controls to ensure that it has sufficient cash or working capital to meet its cash requirements to mitigate this risk.

 

As per the Going Concern note above, the Directors have prepared a cash flow forecast taking into account proceeds from the IPO fund raise, the historical growth in the Group's business and the inherent risks and uncertainties facing the Group's business to assess the Group's working capital requirements.

 

The Group also has systems in place to monitor the margin requirements of its clients and its margin requirement with the institutional counterparty for the back-to-back foreign currency forward contract on a real-time basis and request any necessary top up payment from the clients. The Group also has the right to close any position if no margin is given.

 

Credit risk

 

Credit risk is the risk that clients do not meet their contractual obligations in respect of the currency spot and forward contracts which leads to a financial loss. All customers are subject to credit verification checks. Approximately 90% of the Group's trades are spot currency contracts which are required to be settled within two working days. For forward currency contracts, as noted above, clients are required to provide margin that mitigates credit exposure. Trade limits are applied to all clients. The Group has systems to monitor trade limits and collateral requirements on a real-time basis. The Group does not have any significant concentration of exposures within its client base.

 

Counterparty risk

 

Each trade between a client and the Group is matched with an identified trade with Velocity Trade International ("Velocity"), which is a global foreign exchange liquidity and trade provider that provides pricing, execution and settlement services for the Group.

 

The Group also has brokerage accounts with alternative institutional counterparties and could transact with them instead if Velocity is unable to provide liquidity.

 

Management of settled and open trades are conducted via Currency Cloud, the GV (formerly Google Ventures) backed global payments and FX platform. Client funds are transferred to Velocity via Currency Cloud for additional protection and to reduce counterparty risk.

 

17           Financial commitments

 

The Group is not considered to have any operating lease commitments. The offices utilised by the Group are serviced offices, which have a short notice period and therefore it has not been considered necessary to disclose these as an operating lease commitment.

 

18           CAPITAL MANAGEMENT

 

The capital structure of the business consists of cash and cash equivalents, debt and equity. Equity comprises share capital, share premium and retained losses and is equal to the amount shown as 'Equity' in the balance sheet. The Group's current objectives when maintaining capital are to:

 

•      safeguard the Group's ability to operate as a going concern so that it can continue to pursue its growth plans;

•      provide a reasonable expectation of future returns to shareholders; and

•      maintain adequate financial flexibility to preserve its ability to meet financial obligations, both current and long term.

 

The Group sets the amount of capital it requires in proportion to risk. The Group manages its capital structure and adjusts it in the light of changes in economic conditions and the risk characteristics of underlying assets.

 

The Company is subject to the following externally imposed capital requirements:

·      as a public limited company, the Company is required to have a minimum issued share capital of £50,000.

 

FXPress Payment Services Ltd, a wholly-owned subsidiary of the Company, is subject to the following capital requirement under the Payment Service Regulations 2017:

·      either 10% of fixed overheads for the preceding year or the initial capital requirement of €50,000, whichever is the higher.

 

19           EVENTS AFTER THE REPORTING DATE

 

On 26 February 2021, 24,326 Ordinary Shares were issued at a price of £0.407 each on the exercise of warrants.

 

On 17 March 2021, the Company and William Newton entered into a facility to borrow £350,000 from William Newton at any time until 31 December 2023 on not less than 20 Business Days' notice in consideration of the Company issuing William Newton with 6% unsecured convertible loan notes 2024.

 

On 25 March 2021, the Company and Robert Lee entered into a facility to borrow £100,000 from Robert Lee at any time until 31 December 2023 on not less than 20 Business Days' notice in consideration of the Company issuing Robert Lee with 6% unsecured convertible loan notes 2024. A drawdown notice was issued to Robert Lee on 17 May 2021 requesting payment of the £100,000 loan by 14 June 2021.

 

The convertible loan notes 2024 bear interest at the rate of 6% per annum and will be redeemable on the occurrence of usual events of default and, in any event, on 31 March 2024. They may be converted in tranches of £50,000 at a subscription price of 61 pence per share at any time until a redemption notice is served.

 

On 6 April 2021, the Company was admitted to AIM, London Stock Exchange's market for small and medium size growth companies. The Company placed 3,664,648 new ordinary shares at a price of 61 pence per ordinary share, raising gross proceeds of £2,235,435. The shares sold under the placing represent approximately 18 per cent of the Company's issued share capital. In connection with the Company's listing, 63,114 warrants were issued to the Company's broker, Peterhouse Capital Limited, on 6 April 2021 with an exercise price of 61 pence per share and an expiry date of 6 April 2023. 

 

20           COVID-19

 

The COVID-19 pandemic developed rapidly in 2020, with a significant number of cases. Measures taken by the UK government to contain the virus have affected economic activity. The Group has taken a number of measures to monitor and mitigate the effects of COVID-19, such as safety and health measures for its people such as social distancing and working from home.

 

All staff have successfully worked remotely during government-advised lockdowns and have had full access to the Group's technology platform that allows them to connect virtually and continue to operate as normal on business activities.

 

The impact on the Group's business and results has not been significant. The Group will continue to follow the UK government policies and advice and do its utmost to continue its operations in the best and safest way possible without jeopardising the health and safety of its people.