TIDMITIM
RNS Number : 1889L
itim Group PLC
12 May 2022
12 May 2022
itim Group plc
("itim" or "the Company" and together with its subsidiaries "the
Group")
Full year results for the year ended 31 December 2021 and Notice
of AGM
itim Group plc, a SaaS based technology company that enables
store-based retailers to optimise their businesses to improve
financial performance, is pleased to announce its audited results
for the year ended 31 December 2021.
Financial Highlights
-- Group revenues increased by 14% to GBP13.5 million (2020:
GBP11.8 million)
-- Annual recurring revenue ("ARR") is GBP11.1m (2020: GBP9.6
million)
-- Group Adjusted EBITDA* increased by 47% to GBP2.2 million
(2020: GBP1.5 million)
-- Adjusted EBITDA* margin increased by 17% up 4 percentage
points ("PPT") (2020: 13%)
-- Adjusted Earnings per share** 3.75 pence (2020: 4.10
pence)
-- Closing cash balances were GBP6.2 million at 31 December
2021, up from GBP2.1 million at 31 December 2020
Operational Highlights
-- Completed successful IPO in June 2021 raising GBP8m before
expenses
-- Broader product offering to provide a range of services
to more than 50 major retailers including John Lewis,
Sainsbury's, JD Sports, WH Smith and Majestic Wine amongst
many others
-- New retail advisory committee established including Justin
King and Lee Williams, as well as a number of other high-profile
advisors including Beth Butterwick, CEO of Jigsaw, Simon
Forster, former CEO at Selfridges
-- Launch of Chameleon 360 is an Omni-channel store-centric
solution that combines full Omni-channel capabilities
at POS, with in-store mobile apps, consumer apps, fully
integrated with ecommerce platforms
-- Significant new customer wins in the fashion, electronics
and pharmaceutical retail sectors
* EBITDA has been adjusted to exclude share-based payment
charges, exceptional items, along with depreciation, amortisation,
interest and tax from the measure of profit.
** The profit measure has been adjusted to exclude exceptional
items and share option charge
Ali Athar, CEO of itim Group plc, said: "We are very pleased
with our performance in 2021. This was not only our first year as a
public company but also a transformational year for itim, in which
we have delivered strong growth and strategic progress. The
opportunities that continue to present themselves provide us with
great confidence that there is considerable demand for our
products.
"Trading so far this year has started well, we have seen new
customer wins and extensions of existing contracts as well as the
creation of our new retail advisory committee, with what we believe
are some of the most successful leaders in retail. I look forward
to the remainder of 2022 with optimism and will updating the market
on progress in due course."
This announcement contains inside information for the purposes
of Article 7 of the UK version of Regulation (EU) No 596/2014,
which is part of UK law by virtue of the European Union
(Withdrawal) Act 2018, as amended ("MAR"). Upon the publication of
this announcement via a Regulatory Information Service, this inside
information is now considered to be in the public domain.
Enquiries:
Ali Athar, CEO
Itim Group plc Ian Hayes CFO 0207 598 7700
Katy Mitchell
WH Ireland (NOMAD & Harry Ansell
Broker) Darshan Patel 0207 220 1666
Graham Herring
IFC Advisory Florence Chandler 020 3934 6630
ABOUT ITIM
itim was established in 1993 by its founder, and current Chief
Executive Officer, Ali Athar. itim was initially formed as a
consulting business, helping retailers effect operational
improvement. From 1999 the Company began to expand into the
provision of proprietary software solutions and by 2004 the Company
was focused exclusively on digital technology. itim has grown both
organically and through a series of acquisitions of small, legacy
retail software systems and associated applications which itim has
redeveloped to create a fully integrated end to end Omni-channel
platform.
CHAIRMAN'S STATEMENT
Against what has been a challenging backdrop for everyone, I am
pleased to be in a position to update shareholders on a momentous
year for itim, characterised by achievement and growth.
Despite the impact of the pandemic on the ability of bricks and
mortar retail stores to trade for long periods of time during the
year, the Group delivered on its strategy in continuing to grow
operational profits while investing in strengthening its platform
offering, which led to the Group being quoted on AIM, a market of
the London Stock Exchange in June 2021, raising GBP8m of new
investment in the process.
Moreover, our Optimisation platform continues to expand
geographically with further international, new customer wins in the
USA along with wins in Brazil, Argentina and Uruguay.
Financial results
Overall, we believe the benefits of the Group's high-quality
SaaS business model can be seen in the robust financial performance
in the year. The Group's high levels of recurring revenue (approx.
77% of revenues), low customer churn and continuing transition to
an ARR model has led to increased revenue visibility and
better-quality earnings which delivered double-digit revenue growth
of 14% to GBP13.5m (FY20: GBP11.8m). Careful management of the cost
base, in line with the Group's revenue profile, alongside continued
investment in the product resulted in an increase in adjusted
EBITDA for the year of 47% to GBP2.2m (FY20: GBP1.5m) and an
increased adjusted EBITDA margin of 17% (FY20: 13%).
People
Despite disruption to normal office operations during Covid-19,
we have continued to deliver product innovation and high levels of
service to our customers with our colleagues working remotely.
Whilst we are a technology-driven company, we are also a people-led
business. Our culture of innovation is driven from personal
interaction across the Group and with customers. Remote working had
the potential to present a unique set of challenges. However,
across the organisation, our people tackled each day with
enthusiasm, diligence and a positive outlook. It has been an
impressive response and underlines why our team continues to be our
most valuable asset. I would like to personally thank them all.
Outlook
We enter 2022 in a solid financial position, delivering greater
subscription revenues and good levels of interest in both existing
and new client activity. The Board is excited about the growth
opportunities presented by both The Retail Suite and Profimetrics
platforms, the performance of which is being underpinned by new
marketing initiatives for both products and the ongoing
strengthening of the associated delivery teams.
However, we are continually seeing increases in salary levels
across the technology sector and labour shortages but looking to
overcome this with selective overseas outsourcing. There is no
doubt with the headcount increases planned in 2022 it will put
short-term pressure on profits as expected.
But with a strong cash position, no debt and a well-proven
business model we are well positioned to continue to thrive in
2022.
In conclusion, 2021 has been a landmark year for the Group and I
would like to extend my appreciation to everyone in the Company,
our partners and our customers. Our ongoing growth in such a
challenging environment, a pipeline of market-leading innovations
and the delivery of a successful IPO are significant achievements.
Without exception, everyone in the business has contributed to this
success and ensured that we are an agile, fast-growing
organisation, with customers that see us as integral to their
futures and a robust balance sheet. Importantly, we now have the
vision, technologies and capabilities we need to achieve our
long-term, global ambitions for growth.
Michael Jackson
Chairman
11th May 2022
CHIEF EXECUTIVE'S REVIEW
The year to 31(st) December 2021 was one of excellent progress
for itim. We delivered on our strategic goals for the year,
becoming a public company in June 2021 and delivering a pipeline of
innovative products onto our platform that create further value for
our customers whilst dealing with the challenges of the pandemic as
we come to terms with the new ways of conducting business
remotely.
All this was achieved whilst delivering a strong set of results
for the year that met market expectations and positive sales
momentum as we move into 2022.
Market opportunity
We believe the Covid-19 pandemic has accelerated market forces
that were already changing the retail market forever, and itim is
ideally placed to leverage these trends and ensure its customers
adapt and thrive in this environment. At its core, it is our view
that the retail sector is restructuring around consumer commerce,
where consumer expectations dictate the business model. The volume
and pace with which consumers are moving online requires a radical
response from traditional retailers, who must adapt the
relationship between their physical and digital business models,
enhance their digital capabilities and reinvent their value
proposition for this digital-first world. At the same time, there
are growing trends that are seeing consumers looking to test
products before purchasing online; demanding a seamless process for
returns; seeking a wider choice of delivery options and asking for
increased levels of face-to-face contact for customer service.
Whilst the term omni-channel retail has been around for some
years, it is really only now being understood as a fully-integrated
approach to commerce, providing shoppers with a unified experience
across all channels or touchpoints. This encompasses traditional
stores, e-commerce and mobile apps.
We believe that retailers with stores who embrace this
integrated, end-to-end omni-channel retail model can offer greater
consumer choice, enhanced service standards, and levels of
convenience that outstrip their online-only competitors.
In the post-pandemic landscape, traditional retailers have the
opportunity to not only compete effectively with pure play online
retailers in this new digital world but leverage significant
advantages to win market share. In order to realise this potential
they need to leverage technology systems that efficiently deliver
cross-channel experiences for consumers; whilst continuing to
differentiate from online-only offerings through more diverse
delivery options and a more personalised service.
In essence, omni-channel retailing provides a seamless,
personalised shopping experience, no matter the channel or location
across a unified platform beginning with the supply base. This will
enable:
1. Customers to be able to shop online at a local store in
addition to the central warehouse;
2. Customers to see exactly what is in stock at a local store
to enable 30-minute click and collect and provide retailers
with the opportunity to upsell whilst customers are in
store;
3. Same day delivery through the growth of local courier
networks; and
4. The ability to leverage customer relationships through
the store network and to focus on 'VIP' customers.
5. Curated Orders and subscription revenue streams. As retailers
build a database of customers' individual information,
and begin to understand customer preferences, they have
no need to wait for an order. They send what they believe
the consumer needs, whether it is a curated basket from
the local store or from their warehouse in exchange for
a monthly subscription fee.
Whilst this sounds relatively simple at a high level, only a
minority of retailers have achieved a true omni-channel solution to
date. However, we believe this has now become an imperative for
retailers to achieve in a post Covid-19 world.
The advent of omni-channel retailing - on-trend and given a
boost
In the last six months, following our IPO, we have been pleased
to see those retailers who have been taking omni-channel strategies
seriously report strong market performances. Businesses such as
M&S, JD Sport and Next, have invested significantly in their
digital capabilities and positive results have followed. Although
these are the large publicly visible retailers, they are reflective
of a trend across the whole retailing industry.
We understand most retailers are now looking to follow suit.
However, we believe Covid 19, supply chain problems, and
inflation have placed huge pressures on many retailers' balance
sheets, reducing the capital available to make the kind of
investments traditionally required to transform at this pace and
scale.
itim's game-changing omni-channel platform enables its customers
to reposition their businesses for today's consumer but without the
need for significant upfront investment or vast internal digital
capabilities. We consider itim's unique solutions to be at the
vanguard of efforts to transition retailers to these new models and
with it re-establish store-based organisations at the cutting-edge
of the sector.
Product development and uniqueness
There are 5 areas where we demonstrate competitive advantage
which is critical to the transition to omni-channel excellence.
Unified commerce platform
Unlike other vendors, we provide a single sales platform, across
online, stores and wholesale with a single view of customers,
single view of product and stock and unified marketing engine. This
is crucial to our customers as they transform from product-centric
to customer-centric businesses. This evolution is critical in a
digital-first world. Importantly, it allows us to turn stores into
assets in the fight for customer loyalty and spend by allowing
multiple, complex customer journeys, including seamlessly
integrating services such as 30-minute click and collect and 1-hour
despatch from store.
Price Optimisation
Competing on price is now a basic requirement for a successful
retailer as price transparency becomes so easy for consumers. Yet
it is our view that genuine price optimisation capabilities remain
challenging and elusive in the sector. Powering retailers' price
competitiveness, whilst leveraging gains from a world class
approach to optimisation of promotions and markdowns is becoming
ever more critical to retaining profitability in a digital world
and a key component of the itim armoury.
Stock and Range Optimisation
Omni-channel retailing is opening up huge opportunities for
businesses to gain critical steps towards greater profitability
through stock optimisation. Itim underpins its customers' ability
to route an order to where stock is. Digitally-led retailers do not
need to hold all their stock in stores, but can distribute it
intelligently up the supply chain, all the way back to suppliers.
Optimising stock this way means you can have bigger ranges with
smaller stock investments.
Integrated Order Management
At the heart of omni-channel retailing is the concept of
sophisticated order management. This is about being able to route
customer orders to stock/service locations which are convenient to
customers and profitable for retailers. We have pioneered ideas
such as shop local, which allows consumers to shop the stock in
their local store in addition to shopping the stock in the web
warehouse.
Supplier Collaboration
To be a profitable omni-channel retailer in the modern world, we
believe you need the help/collaboration of your suppliers. That
means you need suppliers to be tightly digitally-integrated with
your business, and you need them to do more of the work for you.
Launching new business models like 'marketplaces' will only be
possible if you can collaborate digitally with your suppliers.
Consignment stock and drop-ship models are becoming more important
tools in a retailers' offering. Ensuring accurate product
information and fast product introductions is now critical to
achieving a competitive advantage.
These are the 5 areas in which we continue to make major
investments in R&D.
Outlook
The business has continued to thrive over the last year as
evidenced by our financial and operational performance, proving
that our strategy continues to deliver. Looking ahead, costs will
inevitably rise as we face rising levels of inflation and pressure
on recruitment and wages. However, our high-levels of customer
retention, excellent customer references and increasingly positive
mix of recurring revenues positions the Group well.
We also are expanding internationally with international markets
now accounting for 36% of our revenues from territories such as
Southern Europe, South America and North America.
Ali Athar
Chief Executive officer
11(th) May 2022
CHIEF FINANCIAL OFFICER'S REVIEW
Income Statement
Revenue
The Group achieved revenue growth of 14% despite the impact of
the global pandemic on the retail sector with stores being
periodically locked down. Revenue was GBP13.5m for the year (2020:
GBP11.8m) with the quality of revenue growth being evidenced by
increased Annual Recurring Revenue (ARR) of 16% to GBP11.1m at the
year-end (2020: GBP9.6m). These numbers were achieved despite the
impact on our overseas ARR contracts with sterling strengthening
against the currencies in which we trade. (See foreign exchange
rates below).
The transition to a subscription revenue model continues at pace
with 77% (2020: 72%) of the Groups revenues in the year derived
from recurring revenues.
Gross profit
The gross margin for the Group was 41% (2020:39.8%). Inevitably
as the Group transitions to a subscription-based revenue model
there is a degradation in margin until the ARR for the year is
booked in full, especially when the cost base has already been
geared up to deliver the ARR. Gross margin on booked recurring
revenue is up 3% to 66% (2020: 63%).
Operating expenses
The operating expenditure has increased for two main reasons.
Firstly due to the inclusion of the EDI Plus costs on a full year
basis following its acquisition in June 2020. But secondly due to
the extra costs associated with fulfilling our governance
requirements, adding three Non Executives to the board along with
the additional costs of being a listed business which were not
required as a private company.
Despite this and the global uncertainties caused by the COVID-19
pandemic which continued into 2021, the Group chose to carefully
manage its cost base in line with our existing and forecast revenue
profile.
Foreign exchange rates
The table below sets out the percentage of annual contracts in
the foreign currencies we trade in and the impacts of those foreign
currencies at the Balance Sheet date and the average movements over
the course of the year for P&L purposes.
2020 2021
FX Rates 31-Dec-20 31-Dec-21 31-Dec-21 Average Average 2021
(% of ARR at FX rate FX rate Variance FX rate FX rate Variance
year end) % %
----------- ----------- ----------- ---------- ---------- ----------
GBPGBP/Euro (ARR
10%) 1.123 1.191 6% 1.125 1.163 3%
----------- ----------- ----------- ---------- ---------- ----------
GBPGBP/BRL (ARR
18%) 7.057 7.612 8% 6.607 7.42 12%
----------- ----------- ----------- ---------- ---------- ----------
GBPGBP/USD (ARR
7%) 1.366 1.354 -1% 1.283 1.376 7%
----------- ----------- ----------- ---------- ---------- ----------
Foreign exchange rates have remained volatile during the year
with an overall strengthening of Sterling against a number of
currencies throughout the year. The most significant movement for
itim has been the 8% depreciation of the Brazilian Real against
Sterling between December 2020 and December 2021 where 18% of our
contracts are in Reals. The Sterling to Euro rate has experienced
similar volatility with Sterling ending the year 6% stronger at
31(st) December 2021 when compared to 31(st) December 2020 with 10%
of our contracts in Euro's.
Phasing of movements over the current and prior year mean that
the weighted monthly average exchange rate to translate the Euro
and Brazilian Real trading results in some currencies is less
volatile. The impact on the weighted monthly average exchange rate
used to translate the Euro reflected only a 3% depreciation of the
Euro based on a weighted monthly average rate of 1.163 for the year
ended 31(st) December 2021 (2020: 1.125). However, the Brazilian
Real depreciated significantly by 12% based on a monthly average
rate of 7.42 for the year ended 31(st) December 2021 (2020:
6.607).
Financing costs
Total net interest costs in the year were GBP67k
(2020:GBP114k).
The reduction in interest payable on external loans was driven
by repayments of borrowings during the year ended 31(st) December
2021.
Exceptional items
Exceptional costs of GBP0.7m (2020: nil) were incurred during
the year. These costs related to the initial public offering and
admission to AIM which could not be directly attributed to the
raising of new equity and therefore were expensed through the
P&L. IPO costs written off against share premium amount to
GBP0.5m (2020: nil)
Taxation
The Group continues to take advantage of R&D tax credits as
it continues to innovate its technology offering. The current year
tax credit is made of up of a net current tax credit of GBP0.26m
(2020:GBP0.45m) and a deferred tax charge of GBP0.2m (2020:
GBP0m).
Earnings per share
Basic EPS for the year was 0.88p (2020:3.74p) and the diluted
EPS was 0.78p (2020:3.31p).
On an adjusted profit basis after adjusting for exceptional
items and the share option charge the adjusted earnings basic EPS
was 3.75p (2020:4.10p) and the adjusted earnings diluted EPS was
3.32p (2020:3.63p).
Dividend
The Board does not propose to pay a dividend in respect of the
financial year (2020:GBPnil).
Group Statement of Financial position
The Group had net assets of GBP13m at 31(st) December 2021
(2020:GBP5m) an increase of GBP8m which was derived from the new
equity raised, along with the profit for the year.
Cash flow and working capital
The Group ended the year with a cash balance of GBP6.2m (2020:
GBP2.1m).
Cash generated from operating activities for the year amounted
to GBP2.1m (2020: GBP2.1m) with further inflows from the net
proceeds of new equity and exercise of options of GBP7.7m (2020:
nil). Cash expended was on capitalised new product development of
GBP1.4m (2020: GBP1.2m) and payment of debt and interest of GBP4.3m
(2020:GBP0.2m). Which taken together with our opening cash balance
of GBP2.1m gives the closing cash balance at the year-end.
A GBP6.2m cash balance at the year-end provides a strong basis
to execute our strategy in 2022.
IPO and admission to AIM
In June 2021 itim was admitted to AIM, a market of the London
Stock Exchange after a successful initial public offering raising
GBP8m (gross) to support its growth strategy as it continues to
transition to a subscription-based revenue model.
Equity
On the 28(th) June 2021 the Company issued 5,194,806 new 5p
shares at 154p each raising GBP8m in new equity.
In May 2021 as part of the listing process, the Company
purchased 110,251,743 deferred shares for 1p and subsequently
cancelled that class of share whilst creating a capital redemption
reserve of the same value.
Additionally, the Company undertook a capital reduction
transferring GBP10,468,919 of share premium to retained
earnings.
Ian Hayes
Chief Financial Officer
11(th) May 2022
Consolidated Statement of Profit or Loss and Other Comprehensive
Income
For the year ended 31 December 2021
Total Total
Note 2021 2020
GBP'000 GBP'000
------------------------------------------- ------ --------- ---------
Revenue 4,5 13,474 11,820
Cost of sales (7,953) (7,114)
------------------------------------------- ------ --------- ---------
Gross profit 5,521 4,706
------------------------------------------- ------ --------- ---------
Other income - 202
Administrative expenses (3,297) (3,374)
EBITDA 2,224 1,534
------------------------------------------- ------ --------- ---------
Amortisation of intangible assets 13 (746) (515)
Share option charge 24 (151) (91)
Depreciation 14 (38) (45)
Depreciation of right-of-use assets 20 (297) (231)
Profit/(Loss) on disposal of right-of-use
assets 20 10 (9)
Profit from operations 1,002 643
------------------------------------------- ------ --------- ---------
Finance costs 10 (67) (114)
Other interest - right of use assets 20 (42) (67)
Exceptional items 6 (667) -
Profit on ordinary activities
before taxation 6 226 462
------------------------------------------- ------ --------- ---------
Taxation 11 26 494
Profit for the year 252 956
------------------------------------------- ------ --------- ---------
Other comprehensive income
------------------------------------------- ------ --------- ---------
Exchange differences on retranslation
of foreign operations (119) 63
Total comprehensive income for
the year net of tax 133 1,019
Earnings per Share
Basic 12 0.88p 3.74p
Diluted 12 0.78p 3.31p
All comprehensive income for continuing operations is shown
above.
Consolidated Statement of Changes in Equity
For the year ended 31 December 2021
Share Capital Foreign
Share Share options redemption exchange Retained
capital premium reserve reserve reserve losses Total
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
---------------------------- --------- ---------- --------- ------------ ---------- ---------- --------
At 1 January 2020 as
restated 2,379 10,469 213 - 82 (9,239) 3,904
Comprehensive income
for the year - - - - - 956 956
Foreign exchange movement - - - - 63 - 63
Total comprehensive
income - - - - 63 956 1,019
Share option charge - - 91 - - - 91
At 31 December 2020 2,379 10,469 304 - 145 (8,283) 5,014
Comprehensive income
for the year - - - - - 252 252
Foreign exchange movement - - - - (119) - (119)
--------- ---------- --------- ------------ ---------- ---------- --------
Total comprehensive
income - - - - (119) 252 133
Share option charge - - 151 - - - 151
Share buyback of deferred
shares (1,103) - - 1,103 - - -
Cancellation of share
premium - (10,469) - - - 10,469 -
Shares issued in the
period - IPO 260 7,740 - - - - 8,000
Share option conversion 25 156 - - - - 181
IPO expenses - (498) - - - - (498)
At 31 December 2021 1,561 7,398 455 1,103 26 2,438 12,981
========= ========== ========= ============ ========== ========== ========
Consolidated Statement of Financial Position
As at 31 December 2021
2021 2020
Note GBP'000 GBP'000
Non-current assets
Intangible assets 13 8,733 8,206
Plant and equipment 14 280 53
Right-of-use assets 20 649 897
Deferred tax 11 65 298
Total non-current assets 9,727 9,454
Current assets
Trade and other receivables 16 3,702 3,492
Cash and cash equivalents 6,172 2,127
Total current assets 9,874 5,619
Total assets 19,601 15,073
Current liabilities
Trade and other payables 17 (5,218) (4,570)
Right-of-use liability 20 (290) (248)
----------- -----------
Total current liabilities (5,508) (4,818)
Non-current liabilities
Trade and other payables due
in more than one year 18 (176) (4,011)
Right-of-use liability 20 (434) (729)
Deferred tax 11 (502) (501)
----------- -----------
Total non-current liabilities (1,112) (5,241)
Total liabilities (6,620) (10,059)
Net assets 12,981 5,014
Capital and reserves
Called up share capital 22 1,561 2,379
Share premium account 23 7,398 10,469
Share options reserve 23 455 304
Capital redemption reserve 23 1,103 -
Foreign exchange reserve 23 26 145
Retained profit/(loss) 23 2,438 (8,283)
------- ---------
Shareholders' funds 12,981 5,014
These financial statements were approved and authorised for
issue by the Board of Directors on 11(th) May 2022
Signed on behalf of the Board of Directors
I D Hayes
Director
Company Statement of Financial Position
As at 31 December 2021
2021 2020
Note GBP'000 GBP'000
Non-current assets
Intangible assets 13 - -
Plant and equipment 14 213 -
Investments 15 5,071 5,071
Deferred tax 11 55 -
5,339 5,071
Current assets
Trade and other receivables 16 10,738 9,903
Cash and cash equivalents 3,209 157
13,947 10,060
Total assets 19,286 15,131
Current liabilities
Trade and other payables 17 (498) (90)
Non-current liabilities
Trade and other payables due in more
than one year 18 (176) (3,762)
Total liabilities (674) (3,852)
Net assets 18,612 11,279
Equity
Called up share capital 22,25 1,561 2,379
Share premium account 23,25 7,398 10,469
Share options reserve 23,25 455 304
Capital redemption reserve 23,25 1,103 -
Retained profit/(loss) 23,25 8,095 (1,873)
Equity shareholders' funds 18,612 11,279
These financial statements were approved and authorised for
issue by the Board of Directors on 11(th) May 2022.
Signed on behalf of the Board of Directors
I D Hayes
Director itim Group plc
Consolidated Cash Flow Statement
Year ended 31 December 2021
2021 2020
Note GBP'000 GBP'000
Cash flows from operating activities
Profit after taxation 252 956
Adjustments for:
Taxation 11 (26) (494)
Finance costs 10 67 114
Share option charge 24 151 91
Other interest on leases 20 42 67
Exchange gain/(loss) - 49
13,14,
Amortisation and depreciation 20 1,081 791
(Profit)/Loss on disposal of right-of-use
assets 20 (10) 9
Cash flows from operations before
changes in working capital 1,557 1,583
Movement in trade and other receivables 16 (354) 275
Movement in trade and other payables 17 335 60
Cash generated from operations 1,538 1,918
Finance costs 10 (4) (69)
Corporation tax 543 285
Net cash flows from operating
activities 2,077 2,134
Cash flows from investing activities
Capital expenditure on intangible
assets 13 (1,361) (1,227)
Purchase of plant and equipment 14 (49) (17)
Cash acquired with subsidiary - 277
Payment to acquire subsidiary - (223)
Proceeds from shares issued - IPO 22 8,000 -
Proceeds from share option conversion 22 181 -
IPO expenses 22 (498) -
Net cash flows from investing
activities 6,273 (1,190)
Cash flows from financing activities
Loan repayments 19 (3,659) -
Interest repayments 19 (98) -
Payment of lease liabilities 20 (335) (457)
New bank loan - 250
Loan issued 16 (210) -
Net cash flows from financing
activities (4,302) (207)
Net increase in cash and cash
equivalents 4,048 737
Cash and cash equivalents at beginning
of year 2,127 1,390
Exchange gains/(losses) on cash
and cash equivalents 29 (3) -
Cash and cash equivalents at end
of year 6,172 2,127
Company Cash Flow Statement
Year ended 31 December 2021
2021 2020
GBP'000 GBP'000
Cash flows from operating activities
Profit after taxation (501) 1,189
Adjustments for:
Taxation 11 40 -
Depreciation 14 5 -
Finance costs 10 63 108
Finance income (18) (20)
Share option charge 24 151 91
Cash flows from operations before
changes in working capital (260) 1,369
Movement in trade and other receivables 16 (721) (977)
Movement in trade and other payables 17 49 (20)
Cash generated from operations (932) 372
Finance costs 10 - (61)
Finance income 18 20
Net cash flows from operating
activities (914) 331
Cash flows from investing activities
Payment to acquire subsidiary - (223)
Proceeds from share capital issued
- IPO 22 8,000 -
Proceeds from share option conversion 22 181 -
IPO expenses 22 (498) -
Net cash flows from investing
activities 7,683 (223)
Cash flows from financing activities
Loan repayments 19 (3,409) -
Interest paid 19 (98) -
Loan issued 16 (210) -
Net cash flows from financing
activities (3,717) -
Net increase in cash and cash
equivalents 3,052 108
Cash and cash equivalents at beginning
of year 157 49
Cash and cash equivalents at end
of year 3,209 157
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. Corporate Information
The consolidated financial statements of ITIM Group plc and its
subsidiaries (collectively, the Group) for the year ended 31
December 2021 were authorised for issue in accordance with a
resolution of the directors on 10(th) May 2022. itim Group plc
("the Company") is a public limited company incorporated and
domiciled in the UK. The nature of the operations and principal
activities of the Company and its subsidiary undertakings (the
"Group") are set out in the Strategic Report on pages 4 to 11 and
the Directors' report on pages 23 to 25.
The Company re-registered as a PLC on 13 May 2021.
2. Basis of preparation
The consolidated financial statements of the Group are prepared
under IFRS and International Financial Reporting Interpretations
Committee ("IFRIC") interpretations in accordance with
International Accounting Standards in conformity with the
requirements of the Companies Act 2006 applicable to companies
reporting under IFRS.
The Company's financial statements have been prepared under IFRS
and International Financial Reporting Interpretations Committee
("IFRIC") interpretations in accordance with International
Accounting Standards in conformity with the requirements of the
Companies Act 2006 and as permitted by section 408 of the Companies
Act 2006, no income statement is presented for the company. The
Company made a profit of GBP501,537 for the year ended 31 December
2021 (2020: GBP1,189,338)
The financial statements are presented in GBP, which is also the
company's functional currency.
Amounts are rounded to the nearest thousand, unless otherwise
stated.
The financial statements have been prepared on the going concern
basis.
3. Summary of significant accounting policies
Basis of consolidation
The Group financial statements consolidate the financial
statements of the company and its subsidiary undertakings drawn up
to 31 December each year. The results of subsidiaries acquired or
sold are consolidated for the periods from or to the date on which
control passed. Acquisitions are accounted for under the
acquisition method.
Subsidiaries
Subsidiaries are all entities over which the Group has the
ability to exercise control and are accounted for as subsidiaries.
The results of subsidiaries are included in the Group income
statement from the date of acquisition until the date that such
control ceases. Intercompany transactions and balances between
Group companies are eliminated upon consolidation.
Revenue recognition
Revenue was recognised to the extent that it was probable that
the economic benefits would flow to the Group and the revenue could
be reliably measured.
Revenue represents the amounts (excluding value added tax)
derived from the provision of goods and services to third party
customers during the year by the group. Revenue is derived from the
Group's principal activity and excludes VAT.
The Group derives revenue from two principal sources as noted
below:
1. Recurring revenue
Recurring revenue consists of:
-- Subscriptions - revenue from subscriptions derive from
the Group's hosted software-as-a-service subscription application,
which allows customers to use hosted software over the
contract period without taking possession of the software.
Revenue is recognised over the contract period, commencing
on the date of the service go live which gives the customer
the right-to-use and access the platform.
-- Support and maintenance - derive from support services
and software upgrades offered to customers using the Group's
software products. Revenue is recognised over the contract
period, commencing on the go-live date of the implementation
which gives the customer the right to access support services
and the right to receive upgrades.
2. One off revenue
One off revenue consists of:
-- Licences - the performance obligation for the provision
of licences is considered to be satisfied when the agreement
is signed by the customer and they are given access to
the related software intellectual property ("IP") without
any requirement to provide updates. It is recognised
in full at the transaction price and over the period
of implementation before the go live date of the implementation.
-- Services - Services revenue relate to design and implementation
services for each customer. Services enhance an asset
that the customer controls and the Group creates specific
fit for purpose assets which cannot be used elsewhere.
The transaction price is the amount determined by fixed
price contracts or on a time and materials basis where
the Group has a right for consideration for work performed
to date. Under the terms of the contracts, the Group
has a right to invoice at the achievement of various
milestones in the contract.
-- Services are recognised over time and management consider
the time spent as a proportion of total time expected
is the most appropriate basis for recognition of this
revenue stream as staff time is the main input into the
delivery of the service. Any differences to the revenue
measured by the above method and the amounts invoiced
are included in the balance sheet. Further information
on the contracts assets or contract liabilities are included
in note 4.
Intangible assets - Goodwill
Goodwill is not amortised but tested for impairment annually and
whenever impairment indicators require. In most cases the Group
identified its cash generating units as one level below that of an
operating segment. Cash flows at this level are substantially
independent from other cash flows and this is the lowest level at
which goodwill is monitored. A goodwill impairment loss is
recognised in the Statement of Comprehensive Income whenever and to
the extent that the carrying amount of a cash-generating unit
exceeds the unit's recoverable amount, which is the greater of
value in use and fair value less cost to sell.
Negative goodwill relating to intangible fixed assets requires
immediate recognition in the Statement of Comprehensive Income.
In calculating goodwill, the total consideration, both actual
and deferred, is taken into account. Where the deferred
consideration is contingent and dependent upon future trading
performance, an estimate of the present value of the likely
consideration payable is made. This contingent consideration is
re-assessed annually. The difference between the present value and
the total amount payable at a future date gives rise to a finance
charge which is charged to the Statement of Comprehensive Income
and credited to the liability over the period in which the
consideration is deferred. The discount used approximates to market
rates.
Intangible assets - research and development expenditure
Research expenditure is written off as incurred. Internally
generated development expenditure is also written off, except where
the directors are satisfied as to the technical, commercial and
financial viability of individual projects. In such cases, the
identifiable expenditure is capitalised and amortised over the
period during which the group is expected to benefit. This period
is seven years. Provisions are made for any impairment.
Intangible assets - other
Other intangible assets recognised in these financial statements
consist of Customer contracts and relationships and Intellectual
Property Rights acquired on the acquisition of EDI Plus
Limited.
Amortisation is calculated to write off their cost or valuation
less any residual value over their estimated useful lives as
follows:
Customer contracts and - straight line over 10 years
relationships
Intellectual Property Rights - straight line over 10 years
The amortisation of intangible fixed assets is shown as a
separate line in the Consolidated Statement of Comprehensive
Income.
The carrying values of intangible assets are reviewed for
impairment whenever events or changes in circumstances indicate the
carrying value may not be recoverable.
Impairment non-current assets
For the purposes of impairment testing, goodwill is allocated to
each of the Group's cash-generating units. A cash-generating unit
to which goodwill has been allocated is tested for impairment
annually, or more frequently when there is an indication that the
unit may be impaired. If the recoverable amount of the
cash-generating unit is less than its carrying amount, the
impairment loss is allocated first to reduce the carrying amount of
any goodwill allocated to the unit and then to the other assets of
the unit pro-rata based on the carrying amount of each asset in the
unit.
Any impairment loss for goodwill is recognised directly in
profit or loss. An impairment loss recognised for goodwill is not
reversed in subsequent periods.
Foreign currencies
Transactions denominated in a foreign currency are translated
into sterling at the rate of exchange ruling at the date of the
transaction. At the balance sheet date, monetary assets and
liabilities denominated in foreign currency are translated at the
rate ruling at that date. All exchange differences are dealt with
in the Statement of Comprehensive Income.
Non-monetary items that are measured in terms of historical cost
in a foreign currency are translated using the exchange rates as at
the dates of the initial transactions. Non-monetary items measured
at fair value in a foreign currency are translated using the
exchange rates at the date when the fair value is determined. The
gain or loss arising on translation of non-monetary measured at
fair value is treated in line with the recognition of gain or loss
on change in fair value in the item.
For consolidation purposes, the assets and liabilities of
overseas subsidiary undertakings are translated at the functional
currency at the rate of exchange ruling at the reporting date.
Profit and loss accounts of such undertakings are consolidated at
the average rate of exchange during the year. Exchange differences
arising are included in a separate component of equity.
Plant and equipment
Plant and equipment is carried at cost less accumulated
depreciation and any recognised impairment in value. Cost comprises
the aggregate amount paid to acquire asset and includes costs
directly attributable to making the asset capable of operating as
intended.
Depreciation of plant and equipment is calculated to write off
their cost or valuation less any residual value over their
estimated useful lives as follows:
Computer equipment - straight line over 3 years
Office equipment - straight line over 3 years
Fixtures and fittings - straight line over 3 years
The assets' residual values, useful lives and methods of
depreciation are reviewed, and adjusted if appropriate on an annual
basis. An asset is de-recognised upon disposal or when no future
economic benefits are expected from its use or disposal. Any gain
or loss arising on de-recognition of the asset (calculated as the
difference between the net disposal proceeds and the carrying
amount of the asset) is included in the income statement in the
period that the asset is derecognised. The carrying values of
tangible fixed assets are reviewed for impairment in periods if
events or changes in circumstances indicate the carrying value may
not be recoverable.
Fixed asset investments
Subsidiaries are measured at cost less impairment.
Investments are reviewed for impairment at the end of the first
full financial year following the acquisition and in other periods
if events or changes in circumstances indicate that the carrying
value may not be recoverable. Provision is made for any
impairment.
Trade and other receivables
Trade and other receivables are initially stated at their fair
value plus transaction costs, then subsequently at amortised cost
using the effective interest method if applicable, less impairment
losses. Provisions against trade and other receivables are made
when there is objective evidence that the Group will not be able to
collect all amounts due to them in accordance with the original
terms of those receivables. The amount of the write down is
determined as the difference between the asset's carrying amount
and the present value of estimated future cash flows.
Cash and cash equivalents
Cash and cash equivalents comprise cash at bank and short-term
deposits with an original maturity of three months or less. Bank
overdrafts that are repayable on demand and form an integral part
of cash management are included as components of cash and cash
equivalents for the purposes of the cash flow statement.
Trade and other payables
Trade and other payables are recognised at original cost.
Loans and borrowings
Loans and borrowings are recorded at amortised cost using the
effective interest method, with interest-related charges recognised
as an expense in finance cost in the statement of comprehensive
income.
Leases - as a lessee
Assets and liabilities arising from a lease are initially
measured on a present value basis. Lease liabilities include the
net present value of fixed lease payments. The lease payments are
discounted using the interest rate implicit in the lease. If that
rate cannot be readily determined, the lessee's incremental
borrowing rate is used, being the rate that the lessee would have
to borrow the funds necessary to obtain an asset of similar value
to the right-of-use asset with similar terms, security and
conditions.
Lease payments are allocated between principal and finance
costs. The finance cost is charged to profit or loss over the lease
period so as to produce a constant periodic rate of interest on the
remaining balance of the liability for each period.
Right-of-use assets are measured at cost comprising the initial
measurement of lease liability, any lease payments made at or
before the commencement date less any lease incentives received,
and any initial direct costs.
Right-of-use assets are depreciated over the shorter of the
asset's useful life and the lease term on a straight-line
basis.
Payments associated with low-value items and leases of a
duration less than 1 year are recognised as an expense in profit or
loss on a straight-line basis.
Income taxes
Current income tax assets and liabilities for the current period
are measured at the amount expected to be recovered from or paid to
the taxation authorities based on the tax rates and tax laws used
to compute the amount are those that are enacted or substantively
enacted by the balance sheet date.
Deferred tax is provided using the liability method on temporary
differences between the tax bases of assets and liabilities and
their carrying amounts for financial reporting purposes at the
reporting date. Deferred tax is calculated on an undiscounted basis
at the tax rates that are expected to apply in the period when the
liability is settled based on the tax rates and tax laws enacted or
substantively enacted by the balance sheet date.
Deferred tax liabilities are recognised for all taxable
temporary differences, except when the deferred tax liability
arises from the initial recognition of goodwill or an asset or
liability in a transaction that is not a business combination and,
at the time of the transaction, affects neither the accounting
profit nor taxable profit or loss.
Deferred tax assets are recognised for all deductible temporary
differences, carry forward of unused tax credits and unused tax
losses, to the extent that it is probable that taxable profit will
be available against which the deductible temporary differences,
and the carry forward of unused tax credits and unused tax losses
can be utilised except when the deferred tax asset relating to the
deductible temporary difference arises from the initial recognition
of an asset or liability in a transaction that is not a business
combination and, at the time of the transaction, affects neither
the accounting profit nor taxable profit or loss.
The carrying amount of deferred tax assets is reviewed at each
reporting date and reduced to the extent that it is no longer
probable that sufficient taxable profit will be available to allow
all or part of the deferred tax asset to be utilised. Unrecognised
deferred tax assets are reassessed at each reporting date and are
recognised to the extent that it has become probable that future
taxable profits will allow the deferred tax asset to be
recovered.
Finance costs
Finance costs comprise interest payable on loans from directors
and third parties and are recognised on an accruals basis.
Share-based payments
The group issues equity-settled share-based payments to certain
employees. Equity-settled share-based payments are measured at fair
value (excluding the effect of non-market-based vesting conditions)
at the date of grant. The fair value determined at the grant date
of the equity-settled share-based payments is expensed on a
straight-line basis over the vesting period, based on the group's
estimate of shares that will eventually vest and adjusted for the
effect of non-market-based vesting conditions
Fair value is measured by use of the Black Scholes Model. The
expected life used in the model has been adjusted, based on
management's best estimate, for the effects of non-transferability,
exercise restrictions, and behavioural considerations.
Pension contributions
The company operates a defined contribution scheme for its
employees. Contributions are charged to the Statement of
Comprehensive Income in the year they are payable. The assets of
the scheme are held separately from those of the group.
Financial instruments
Financial assets and financial liabilities are recognised when
the Group becomes a party to the contractual provisions of the
financial instrument.
Financial assets are derecognised when the contractual rights to
the cash flows from the financial asset expire, or when the
financial asset and substantially all the risks and rewards are
transferred.
A financial liability is derecognised when it is extinguished,
discharged, cancelled or expires.
Government grants
Government grants are recognised where there is reasonable
assurance that the grant will be received and all attached
conditions will be complied with. When the grant relates to an
expense item, it is recognised as income on a systematic basis over
the periods that the costs, which it is intended to compensate, are
expensed. The other income included in the Consolidated Statement
of Profit or Loss and Other Comprehensive Income relates entirely
to government support through the furlough scheme.
Where the grant relates to an asset, it is recognised as income
in equal amounts over the expected useful life of the related
asset.
Use of assumptions and estimates
The Group makes judgements, estimates and assumptions that
effect the application of policies and reported amounts of assets
and liabilities, income and expenses. The resulting accounting
estimates calculated using these judgements and assumptions will,
by definition, seldom equal the related actual results but are
based on historical experience and expectations of future events.
The estimates and underlying assumptions are reviewed on an ongoing
basis. Revisions to accounting estimates are recognised in the
period in which the estimate is revised if the revision effects
only that period, or in the period of revision and future periods
if the revision effects both current and future periods.
The judgements and key sources of estimation uncertainty that
have a significant effect on the amounts recognised in the
financial statements are discussed below.
Useful economic lives of intangible assets
Intangible assets are amortised over their useful lives. Useful
lives are based on management's estimates, which are periodically
reviewed for continued appropriateness. Changes to estimates can
result in variations in the carrying values and amounts charged to
the statement of comprehensive income in specific periods.
Change in accounting policies
The following new standards and amendments to standards are
mandatory for the first time for the financial year beginning 1st
January 2021.
(a) New and amended standards adopted by the Company:
There are no new standards which have had a material impact in
the annual financial statements for the year ended 31 December
2021.
(b) New standards, interpretations, and amendments not yet effective:
There are a number of standards, amendments to standards, and
interpretations which have been issued by the IASB that are
effective in future accounting periods that the Group has decided
not to adopt early. These include:
-- Annual Improvements to IFRS Standards 2018-2020 Cycle
- IFRS 9 Financial Instruments and IFRS 16 Leases
-- Amendments to IAS 1 and IFRS Practice Statement 2 - Disclosure
of Accounting Policies
-- Amendments to IAS 8 - Definition of Accounting Estimates
-- Amendments to IAS 12 - Deferred Tax related to Assets
and Liabilities arising from a Single Transaction
4. Segmental reporting
The chief operating decision maker ("CODM") for the purpose of
IFRS 8 is the Board. Segments are determined by reference to the
internal reports reviewed by the Board. The group's operations
relate to the provision of technology solutions to help clients
drive revenues and profit.
The Group measures the performance of its operating segments
through a measure of segment profit or loss which is referred to as
EBITDA. This measure is reported to the CODM for the purposes of
resource allocation and assessment of performance. The measure is
the same as reported in the historic financial information.
Information about geographic location by key segments
Year ended 31 December 2021
UK Portugal Total
GBP000 GBP000 GBP000
Revenue 9,191 4,283 13,474
Non-current assets 8,219 1,508 9,727
---------- ------------ ---------
Year ended 31 December 2020
UK Portugal Total
GBP000 GBP000 GBP000
Revenue 7,013 4,807 11,820
Non-current assets 7,701 1,455 9,156
---------- ------------ ---------
Information about major customers
Transactions with a single customer exceeding 10% of total
revenue amounted to GBP2,541k in the year (2020: GBP1,780k) and
related to one customer (2020: 1).
5. Revenue
The analysis of the Group's revenue by geographical destination
is set out below.
2021 2020
GBP'000 GBP'000
United Kingdom 8,611 6,506
Europe 271 520
Rest of World 4,592 4,794
13,474 11,820
======== ========
A breakdown of revenue by the two revenue streams as detailed in
accounting policies is shown below:
2021 2020
GBP'000 GBP'000
Recurring revenue 10,324 8,566
One off revenue 3,150 3,254
13,474 11,820
Revenue is either recognised at a point in time or over the
period of the contract in line with the accounting policy (note
2).
2021 2020
GBP'000 GBP'000
Contract assets 418 99
Contract liabilities 2,498 1,809
======== ========
The following table provides information on contract assets and
contract liabilities from contracts with customers:
Contract assets ("accrued income") are recognised where there
are excess of revenues earned over billings.
Contracts are classified assets when only the act of invoice is
pending, there is an unconditional right to receive cash and only
the passage of time is required as per contractual terms.
Contract liabilities ("deferred income") are recognised when
there are billings in excess of revenues. Contracts are classified
as liabilities when there is an obligation to transfer goods or
services to a customer for which the Group has received
consideration from the customer (or the payment is due) but the
transfer has not yet completed. These arise based on the billing
cycle of the Group's revenues and all are expected to be reversed
in under one year.
6. Profit on operating activities before taxation
Profit on ordinary activities before taxation is stated after
charging:
2021 2020
GBP'000 GBP'000
Share based payments 151 91
Exceptional items 667 -
Deprecation of tangible fixed assets
* owned 38 45
Depreciation of right-of-use assets 297 231
Amortisation of intangible assets 746 515
(Profit)/Loss on disposal of right-of-use assets (10) 9
Auditors' remuneration (see note 7) 139 27
Exceptional items relate to costs incurred in relation to the
initial public offering and the admission to the AIM Market of the
London Stock Exchange.
7. Auditors remuneration
The analysis of auditors' remuneration is as follows:
2021 2020
GBP'000 GBP'000
Fees payable to the company's auditors for the
audit of the company's annual accounts 13 2
Fees payable to the company's auditors and their
associates for other services to the group
* The audit of the company's subsidiaries pursuant to
legislation 27 20
* Tax compliance services 3 3
* Other fees 96 2
Total other services 126 25
8. Employee information
Their aggregate emoluments were:
2021 2020
GBP'000 GBP'000
Wages and salaries 6,549 6,200
Social security costs 987 923
Other pension costs 210 202
Other benefits 340 286
8,086 7,611
The average monthly number of employees (including directors)
during the year for the group was as follows:
2021 2020
No. No.
Selling and administration 22 25
Technical 138 132
160 157
9. Directors' emoluments
2021 2020
GBP'000 GBP'000
Aggregate emoluments 896 891
Pension contributions (money purchase
schemes) 41 49
937 940
Total directors' emoluments disclosed above is equivalent to
total key management personnel compensation in the period.
Directors' emoluments disclosed above include the following
payments to the highest director:
2021 2020
GBP'000 GBP'000
Aggregate emoluments 269 232
Pension contributions (money purchase
schemes) 13 11
282 243
2021 2020
No. No.
Number of directors to whom relevant benefits
are accruing under:
Money purchase schemes 4 4
The above is equivalent to total key management personnel
compensation. There were no other key management personnel other
than the Directors.
Further details of Directors remuneration can be found in the
remuneration report on pages 21 to 22.
Share based compensation
The Group operates an equity-settled share based compensation
plan for Directors and executives. In accordance with IFRS 1, the
Group has elected to implement the measurement requirements of IFRS
2 in respect of only those equity-settled share options that were
granted after 7 November 2002 and that had not vested as at 1
January 2005. The fair value of the employee services received in
exchange for the grant of options is recognised as an expense over
the vesting period. The total amount to be expensed over the
vesting period is determined by reference to the fair value of the
options granted at the grant date.
At each year end date, the Group revises its estimate of the
number of options that are expected to vest. It recognises the
impact of the revision of original estimates, if any, in the
Statement of Consolidated Income, and a corresponding adjustment to
equity over the remaining vesting period. When share options are
cancelled the Group accounts for the cancellation as an
acceleration of vesting and therefore recognises immediately the
amount that otherwise would have been recognised for services
received over the remainder of the vesting period. The proceeds
received net of any directly attributable transaction costs are
credited to share capital (nominal value) and share premium when
the options are exercised. The fair value of share options has been
assessed using the Black Scholes Model.
No share options were granted to Directors in the period (2020 -
2,000,000).
Included on the face of the Statement of Comprehensive Income,
is a total charge for share based payments of GBP151,000 (2020:
GBP91,000) which arises wholly from transactions accounted for as
equity settled share based payments.
10. Finance costs
2021 2020
GBP'000 GBP'000
Other interest and similar charges 67 114
11. Taxation
(a) Taxation charge:
2021 2020
GBP'000 GBP'000
Total current income tax credit charged in
the income statement
Research and development tax credit (300) (443)
Portugal corporate tax 40 56
Adjustment in respect of prior years - (63)
----------- -----------
Total current income tax (260) (450)
Deferred tax (income) / expense
Current year 234 (44)
----------- -----------
234 (44)
Total income tax (26) (494)
(b) Taxation reconciliation:
The current income tax credit for the year is explained
below:
2021 2020
GBP'000 GBP'000
Profit before tax 226 462
Profit at the standard UK income tax rate of
19% (2020: 19%) 43 88
Effects of:
Expenses not deductible for tax purposes 253 17
Capital allowances in excess of depreciation (45) 2
Tax losses utilised as part of research and
development tax credit (300) (443)
Unrelieved tax losses and other deductions arising (112) -
in the year
B/fwd losses group relieved (72) -
Adjustment in respect of earlier year - (63)
Difference in overseas tax rates and temporary
GAAP differences (27) (63)
Recognition of deferred tax asset in respect
of losses 92 (116)
Other deferred tax timing differences 142 84
Total income tax credited in the income statement (26) (494)
(c) Deferred tax
Deferred tax balances consist of the following timing
differences
Group Company
2021 2020 2021 2020
GBP'000 GBP'000 GBP'000 GBP'000
Deferred tax asset
Acceleration capital allowances-UK (466) (326) (40) -
Tax losses available for carry
forward - UK 528 621 95 -
Other timing differences-UK 3 3 - -
65 298 55 -
Group Company
2021 2020 2021 2020
GBP'000 GBP'000 GBP'000 GBP'000
Deferred tax asset
Acceleration capital allowances-Portugal (292) (266) - -
Arising on business combinations
- UK (210) (235) - -
(502) (501) - -
The Group has not recognised all deferred tax assets in respect
of tax losses due to timing uncertainty regarding the
recoverability against future profits. If all tax losses were
recognised the deferred tax asset would increase as below in each
year.
2021 2020
GBP'000 GBP'000
Deferred tax asset
Acceleration capital allowances-UK (467) (325)
Tax losses available for carry
forward - UK 1,817 1,939
Other timing differences-UK 3 3
--------- ---------
Deferred tax asset 1,353 1,617
========= =========
Increase in deferred tax asset
if all losses recognised 1,288 1,319
======= =======
The movement in deferred tax assets during the period are:
Group
Accelerated
Accelerated capital Tax losses
capital allowances available Other
allowances on Development for carry timing
on PPE- costs- forward- differences-
Deferred tax assets UK UK UK UK Total
At 31 December 2019
(as restated) (1) (253) 433 3 182
Charged to profit and
loss account 2 (73) 187 0 116
------------- ----------------- ------------ --------------- -------
At 31 December 2020 1 (326) 620 3 298
Charged to profit and
loss account (47) (94) (92) 0 (233)
------------- ----------------- ------------ --------------- -------
At 31 December 2021 (46) (420) 528 3 65
============= ================= ============ =============== =======
Company
Accelerated Tax losses
capital available
allowances for carry
on PPE- forward-
Deferred tax assets UK UK Total
At 31 December 2020 - - -
Charged to profit and
loss account (40) - (40)
Transferred from Itim
Ltd 95 95
------------- ------------ -------
At 31 December 2021 (40) 95 55
============= ============ =======
The movement in deferred tax liabilities
during the period are:
Accelerated Timing differences
capital allowances on acquired
on Development intangible
costs- Portugal assets- UK Total
Deferred tax liabilities
At 31 December 2019 (as restated) (182) - (182)
Arising on business combination - (247) (247)
Charged to profit and loss account (84) 12 (72)
--------------------- -------------------- -------
At 31 December 2020 (266) (235) (501)
Charged to profit and loss account (26) 25 (1)
--------------------- -------------------- -------
At 31 December 2021 (292) (210) (502)
===================== ==================== =======
12. Earnings per share
Basic and diluted loss per share is calculated by dividing the
profit attributable to owners of the parent by the weighted average
number of ordinary shares in issue during the period. For the
avoidance of doubt the deferred shares have been excluded as they
have no rights to profits or capital. Additionally, the Company's
ordinary shares were subject to a share consolidation where 5
ordinary shares were converted into 1 ordinary share. The
comparative period weighted average number of shares has been
adjusted for this to aid comparison. The Company's share options
have a dilutive effect over the two year period.
2021 2020
GBP'000 GBP'000
Profit after tax for the year 252 956
------------------------------------------------- --------- ---------
Exceptional items 667 -
Share option charge 151 91
------------------------------------------------- --------- ---------
Adjusted Profit after tax for the
year 1,070 1,047
Weighted average number of shares:
--------------------------------------------- --------- ---------
Basic - 000 28,536 25,534
Potentially dilutive share options
- 000 3,668 3,318
Diluted average number of shares -
000 32,204 28,852
Earnings per share:
--------------------------------------------- --------- ---------
Basic - pence on continuing operations 0.88 3.74
Diluted - pence on continuing operations 0.78 3.31
------------------------------------------------- --------- ---------
Adjusted earnings - Basic - pence on
continuing operations 3.75 4.10
Adjusted Diluted - pence on continuing
operations 3.32 3.63
13. Intangible assets
Group Acquired Customer
Development Goodwill intellectual contracts
cost property Total
rights
GBP000 GBP000 GBP000 GBP000 GBP000
Cost
At 1 January 2021 12,185 8,712 300 1,000 22,197
Foreign exchange
differences (150) - - - (150)
Additions 1,351 - - - 1,351
At 31 December 2021 13,386 8,712 300 1,000 23,398
Amortisation
At 1 January 2021 9,167 4,759 15 50 13,991
Foreign exchange
differences (72) - - - (72)
Charge for the period 616 - 30 100 746
------------------------ --------------- ------------ --------------- ------------ ---------
At 31 December 2021 9,711 4,759 45 150 14,665
Net book value
------------------------ --------------- ------------ --------------- ------------ ---------
At 31 December 2021 3,675 3,953 255 850 8,733
------------------------ --------------- ------------ --------------- ------------ ---------
At 31 December 2020 3,018 3,953 285 950 8,206
------------------------ --------------- ------------ --------------- ------------ ---------
Goodwill arising prior to 1 January 2020 relates to acquisition
prior to the date of transition to IFRS of 1 January 2015 and
therefore the exemption for business combinations completed before
that date has been applied and the amounts not restated.
The Board consider that there is only one Cash Generating Unit.
In accordance with the accounting policy, goodwill is tested
annually for impairment, Management have used a fair value less
cost of sales methodology supported by offers for the Group and
consider that the value supports the carrying value of goodwill at
each period end.
Company Development
costs
Total
GBP000 GBP000
Cost
------------------------------ ------------- ---------
At 1 January 2021 and at 31
December 2021 13 13
------------------------------- ------------- ---------
Amortisation
------------------------------ ------------- ---------
At 1 January 2021 and at 31
December 2021 13 13
------------------------------- ------------- ---------
Net book value
------------------------------- ------------- ---------
At 31 December 2021 - -
------------------------------- ------------- ---------
At 31 December 2020 - -
------------------------------- ------------- ---------
Development costs for The Retail Suite have been capitalised in
accordance with IAS 38 "Intangible assets". Production commenced in
2008, from which date the related costs were written off over 7
years.
14. Plant and equipment
Group Fixtures
and equipment
Total
GBP000 GBP000
Cost
At 1 January 2021 987 987
Foreign exchange
differences (7) (7)
Additions 266 266
Disposals (11) (11)
At 31 December 2021 1,235 1,235
Depreciation
------------------------ ---------------- ---------
At 1 January 2021 934 934
Foreign exchange
differences (6) (6)
Charge for the period 38 38
Disposals (11) (11)
-------------------------- ---------------- ---------
At 31 December 2021 955 955
Net book value
------------------------ ---------------- ---------
At 31 December 2021 280 280
-------------------------- ---------------- ---------
At 31 December 2020 53 53
-------------------------- ---------------- ---------
Company Fixtures
and equipment
Total
GBP000 GBP000
Cost
At 1 January 2021 16 16
Additions 217 217
At 31 December 2021 233 233
Depreciation
At 1 January 2021 15 15
Charge for the period 5 5
At 31 December 2021 20 20
Net book value
------------------------ ---------------- ---------
At 31 December 2021 213 213
-------------------------- ---------------- ---------
At 31 December 2020 1 1
-------------------------- ---------------- ---------
15. Investments
The principal subsidiaries of itim Group plc, all of which have
been included in these consolidated financial statements, are as
follows:
Company Shares Other investments
in group
undertaking Total
GBP000 GBP000 GBP000
Cost
At 1 January 2021 and
at 31 December 2021 8,005 46 8,051
Provision for impairment
--------------------------- ----------- -------------- ------------------- ---------
At 1 January 2021 and
at 31 December 2021 2,934 46 2,980
Net book value
--------------------------- ----------- -------------- ------------------- ---------
At 31 December 2021 5,071 - 5,071
----------------------------------------- -------------- ------------------- ---------
At 31 December 2020 5,071 - 5,071
----------------------------------------- -------------- ------------------- ---------
The company holds more than 20% of the share capital of the
following companies:
Class Principal Profit/ Net assets/
Subsidiary Country Percentage of share activity (loss) (liabilities)
undertakings of holding GBP'000 GBP'000
Incorporation
Ordinary
England 'A' Software
and Ordinary consultancy
ITIM Limited Wales 100% Deferred and supply 198 (6,952)
------------------ -------------- ------------ ----------------- ---------- ----------------
England
and Data exchange
EDI Plus Limited Wales 100% Ordinary services 377 921
------------------ -------------- ------------ ----------------- ---------- ----------------
Profimetrics Development
Software and
Solutions Ordinary distribution
S.A Portugal 100% Preferred of software 285 1,579
------------------ -------------- ------------ ----------------- ---------- ----------------
The registered address of ITIM limited and EDI Plus Limited are
same as ITIM Group Plc.
The registered address of Profimetrics Software Solutions S.A.
is R. Lionesa 446, Edifício C Loja L, 4465-671 Leça do Balio,
Portugal.
16. Trade and other receivables
Group Company
2021 2020 2021 2020
GBP'000 GBP'000 GBP'000 GBP'000
Trade receivables 2,133 2,369 - -
Corporation tax 324 596
Amounts owed by group undertakings
due within one year - - 8,359 7,995
Amounts owed by group undertakings
due in greater than one year - - 1,908 1,908
Other receivables 333 229 235 -
Loan receivables 210 - 210
Prepayments and accrued income 702 298 26 -
3,702 3,492 10,738 9,903
17. Trade and other payables
Group Company
2021 2020 2021 2020
GBP'000 GBP'000 GBP'000 GBP'000
Trade payables 687 592 21 1
Corporation tax 40 - - -
Other taxation and social security 650 1,438 55 89
Other payables 96 27 41 -
Loans and borrowings (see note 19
below) 318 - 318 -
Accruals 929 704 63 -
Deferred income 2,498 1,809 - -
5,218 4,570 498 90
18. Trade and other payables due in more than one year
Group Company
2021 2020 2021 2020
GBP'000 GBP'000 GBP'000 GBP'000
Other payables 176 - 176 -
Loans and borrowings (see note 19
below) - 4,011 - 3,762
176 4,011 176 3,762
19. Loans and borrowings
Group Company
2021 2020 2021 2020
GBP'000 GBP'000 GBP'000 GBP'000
Loans - 3,658 - 3,408
Accrued interest 318 353 318 354
318 4,011 318 3,762
Loans comprise of:
Secured liabilities - Group
2021 2020
GBP'000 GBP'000
External investor - 450
Directors - 770
Unsecured liabilities - Group
External investor - -
Bank loan - CBILs scheme - 250
Deferred considerations - 2,088
Directors - 100
----------- ----------
- 3,658
The loans from Directors, the external investor and the bank
bears interest at rates between bank base plus and 3% and LIBOR
plus 9%. No interest is charged on the deferred consideration loan
in respect of the EDI Plus Limited acquisition.
Analysis of maturity of loans and borrowings
Group Company
2021 2020 2021 2020
GBP'000 GBP'000 GBP'000 GBP'000
Amounts payable
Within one year 318 - 318 -
Within two and five years - 4,011 - 3,762
318 4,011 318 3,762
Net obligations under finance leases are secured by fixed
charges on the assets concerned.
20. Leases
The Group leases five units within properties from which it
operates and also leases computer equipment for the
hosting centre. Lease payments are fixed throughout the contract period.
Right-of-use Right-of-use
- Property - Equipment Total
GBP'000 GBP'000 GBP
Cost
---------------------------------------- -------------- -------------- ---------
At 1 January 2021 1,118 225 1,343
Foreign exchange differences (18) - (18)
Additions 128 9 137
Disposals (50) - (50)
---------------------------------------- -------------- -------------- ---------
At 31 December 2021 1,178 234 1,412
Depreciation
---------------------------------------- -------------- -------------- ---------
At 1 January 2021 422 24 446
Foreign exchange differences (7) - (7)
Charge for the year 301 65 366
Disposals (42) - (42)
---------------------------------------- -------------- -------------- ---------
At 31 December 2021 674 89 763
Net book value
---------------------------------------- -------------- -------------- ---------
At 31 December 2021 504 145 649
---------------------------------------- -------------- -------------- ---------
At 31 December 2020 696 201 897
---------------------------------------- -------------- -------------- ---------
Lease liabilities:
2021 2020
GBP'000 GBP'000
At 1 January 977 1,737
Foreign exchange movement (11) -
Interest expense 42 67
Lease payments (335) (457)
Additions 51 204
Disposals - (574)
At 31 December 2021 724 977
Amounts payable are as follows:
2021 2020
GBP GBP
Due within 1 year 290 248
Due 2-5 years 404 681
Due over 5 years 30 48
Total 724 977
The Company's right of use assets consist of the Company's
premises, data centres' and sundry office equipment. The expiry of
the leases varies between 1 and 8 years.
21. Financial instruments
Financial risk factors
The Group's financial assets comprise cash and cash equivalents,
trade receivables and accrued income. These are all measured at
amortised cost. The financial liabilities comprise loans and
borrowings, trade payables and accruals, lease liabilities and
deferred consideration payable for acquisitions of subsidiaries.
These are measured at amortised cost.
The majority of the financial instruments arise directly from
the operations with the exception of loans and borrowings and lease
liabilities which have been used to finance the operations.
Fair values of financial instruments
For the following financial assets and liabilities: trade and
other payables, trade and other receivables and cash at bank and in
hand, the carrying amount approximates the fair value of the
instrument due to the short-term nature of the instrument. The
Directors consider that there is no material difference between
book value and fair value for any of the financial instruments
held.
Financial risk management
The Group's activities expose the Group to a number of risks
including capital management risk, interest rate risk, foreign
exchange risk, credit risk and liquidity risk.
It is the Group's policy that no trading in financial
instruments should be undertaken.
There have been no substantive changes in the Group's exposure
to financial instrument risks, its objectives, policies and
processes for managing those risks or the methods used to measure
them from previous periods unless otherwise stated in this
note.
The Board has overall responsibility for the determination of
the Group's risk management objectives and policies and, whilst
retaining ultimate responsibility for them, it has delegated the
authority for designing and operating processes that ensure the
effective implementation of the objectives and policies to the
Group's finance function. The Board receives monthly reports from
the Finance Department through which it reviews the effectiveness
of the processes put in place and the appropriateness of the
objectives and policies it sets.
The overall objective of the Board is to set policies that seek
to reduce risk as far as possible without unduly affecting the
Group's competitiveness and flexibility. Further details regarding
these policies are set out below:
Interest rate risk
The Group's interest rate exposure arises mainly from the
interest bearing borrowings as disclosed in note 19. All the
Group's facilities were at floating rates, which exposed the entity
to cash flow risk. However, given the low level of borrowings this
is not considered material.
Credit risk
Credit risk is the risk of financial loss to the Group if a
customer or counterparty to a financial instrument fails to meet
its contractual obligations.
The Group's largest financial assets are the cash balances held
in banks and it is exposed to credit risk on those balances. It is
the Group's policy only to make deposits with banks with an
acceptable credit rating.
The Group is mainly exposed to credit risk from credit sales. It
is Group policy, implemented locally, to assess the credit risk of
new customers before entering contracts. Such credit ratings are
taken into account by local business practices. An ageing analysis
of trade receivables is detailed below:
2021 Total Current 30-60 days > 60 days
GBP'000 GBP'000 GBP'000 GBP'000
Trade and other
receivables 2,133 1,642 117 374
Contract assets 418 418 - -
2,551 2,060 117 374
2020 Total Current 30-60 days > 60 days
GBP'000 GBP'000 GBP'000 GBP'000
Trade and other
receivables 2,369 1,512 336 521
Contract assets 99 99 - -
2,468 1,611 336 521
Trade receivables are recognised initially at the transaction
price. They are subsequently measured less any provision for
impairment in relation to expected credit losses. At each reporting
date the Group assesses the expected credit losses and changes in
credit risk since initial recognition of the receivable and a
provision for impairment is recognised when considered necessary.
The Group considers the ageing to be reasonable and has no history
of significant bad debts. No provisions have been made in in these
financial statements. The Board do not consider the credit risk to
be significant for the financial assets currently held.
Foreign exchange risk
Foreign exchange risk arises when individual Group entities
enter into transactions denominated in a currency other than their
functional currency. The Group's policy is, where possible, to
allow Group entities to settle liabilities denominated in their
functional (currency). Where Group entities have liabilities
denominated in a currency other than their functional currency (and
have insufficient reserves of that currency to settle them), cash
already denominated in that currency will, where possible, be
transferred from elsewhere within the Group.
The Group's main exposure to foreign currency risk is on the
trade receivables in the Portuguese subsidiary which are not held
in Euros. The Directors have considered the balances at year end
and based on the level of foreign currency balances and the
expected timing of settlement of those amounts that the foreign
exchange risk is not material.
Liquidity risk
Liquidity risk is the risk that ITIM Group may encounter
difficulty in meeting its obligations associated with the financial
liabilities that are settled by delivering cash or other financial
assets. The Group actively maintains a mixture of long-term and
short-term debt finance that is designed to ensure the Group has
sufficient available funds for operations and planned
expansions.
The Group would normally expect that sufficient cash is
generated in the operating cycle to meet the contractual cash flows
through effective cash management. The maturity analysis of the
financial liabilities are included below:
As at 31 December Carrying 1 year 1<2 years 2-5years 5 years
2021 amount or less
GBP'000 GBP'000 GBP'000 GBP'000
GBP'000
Trade and other
payables 1,888 1,712 176 - -
Right of use liability 724 290 269 135 30
Other loans and
borrowings 318 318 - - -
------------------------- ---------- ---------- ----------- ---------- ----------
2,930 2.320 445 135 30
As at 31 December Carrying 1 year 1<2 years 2-5years 5 years
2020 amount or less
GBP'000 GBP'000 GBP'000 GBP'000
GBP'000
Trade and other
payables 1,323 1,323 - - -
Right of use liability 977 248 391 253 85
Other loans and
borrowings 4,012 - 3,911 101 -
------------------------- ---------- ---------- ----------- ---------- ----------
6,312 1,571 4,302 354 85
Capital management risk
The Group's main objective when managing capital is to protect
returns to shareholders by ensuring the Group will continue to
trade for the foreseeable future. The Group also aims to optimise
its capital structure of debt and equity so as to minimise its cost
of capital. The Group in particular reviews its levels of borrowing
and the repayment dates, setting these out against forecast cash
flows and reviewing the level of available funds.
22. Share capital
2021 2020
GBP'000 GBP'000
Authorised:
37,949,651 Ordinary shares of 5p each 1,898 -
189,748,257 Ordinary shares of 1p each - 1,898
110,251,743 Deferred shares of 1p each - 1,102
1,898 3,000
Allotted, called up and fully paid:
2021 2020
GBP'000 GBP'000
31,210,607 Ordinary shares of 5p each 1,561 -
127,671,264 Ordinary shares of 1p each - 1,277
110,251,743 Deferred shares of 1p each - 1,102
1,561 2,379
In May 2021, the Company bought back 110,251,743 deferred shares
of GBP0.01 each for GBP0.01 which were then subsequently cancelled.
This reduced share capital by GBP1,102,517 and created a capital
redemption reserve of the same value. At the same time, the share
premium account was reduced by GBP10,469,000 and this was credited
to the Company's profit and loss reserve.
On 18(th) June 2021 250,000 GBP0.05 Ordinary shares were issued
for consideration of GBP19,938. The share premium on the issue was
GBP7,438.
On 28(th) June 2021 231,548 GBP0.05 Ordinary shares were issued
for consideration of GBP160,000. The share premium on the issue was
GBP148,422.
On 28(th) June 2021 5,194,806 GBP0.05 Ordinary shares were
issued for consideration of GBP8,000,001. The share premium on the
issue was GBP7,740,261.
IPO expenses on the new share issue of GBP497,641 were written
off against the share premium account.
A summary of the rights of the different classes of share is
given below:
Voting
All Ordinary shares are entitled to one vote each. The holders
of deferred shares are not entitled to receive notice of, to
attend, to speak or to vote at any general meeting of the
Company.
Dividends
The profits of the Company available for distribution shall be
used to pay dividends to the holders of Ordinary Shares a dividend
equivalent to such amounts as the Directors may determine and as is
approved by the Ordinary Shareholders in general meeting.
23. Reserves
Share premium
This reserve records the amount above the nominal value received
for shares sold, less transaction costs.
Share options reserve
The share options reserves represent the fair value of
equity-settled share options granted using the Black Scholes
model.
Capital redemption reserve
This reserve arises on the purchase of the company's own
shares.
Foreign exchange reserve
This reserve includes any exchange differences arising on the
retranslation of foreign subsidiaries on consolidation.
Retained earnings
This balance represents the cumulative profit and loss made by
the Group net of distributions to owners.
24. Share-based payments
Share options
The Company has a share option scheme for certain employees of
the Group. Options are granted with a fixed exercise price. The
vesting period varies from vesting immediately to vesting over 2
years from the date of grant. If the options remain unexercised
after a period of ten years from the date of grant the options
expire. Options are forfeited if the employee leaves the Group
before the options vest.
Details of equity settled share options outstanding during the
year are as follows:
Year ended 31 December 2021
Outstanding Outstanding
at 1 Share at 31
Grant January Consolidation December Exercise Exercise
date 2021 Granted Exercised Lapsed 2021 period price
08/08/2011 1,250,000 (1,000,000) - (250,000) - - 10 years 1.595p
14/04/2015 750,000 (600,000) - - - 150,000 10 years 1.595p
10/04/2017 13,075,000 (10,460,000) - - - 2,615,000 10 years 3.000p
31/03/2021 2,000,000 (1,600,000) - - - 400,000 10 years 14.000p
19/04/2021 - - 723,589 (231,548) - 492,041 10 years 70.000p
17,075,000 (13,660,000) 723,589 (481,548) - 3,657,041
------------- ---------------- --------- ----------- -------- ------------- ---------- -----------
Year ended 31 December 2020
Outstanding Outstanding
Grant at 1 January at 31 December Exercise Exercise
date 2020 Granted Exercised Lapsed 2020 period price
08/08/2011 1,250,000 - - - 1,250,000 10 years 1.595p
14/04/2015 750,000 - - - 750,000 10 years 1.595p
10/04/2017 13,075,000 - - - 13,075,000 10 years 3.000p
31/03/2021 - 2,000,000 - - 2,000,000 10 years 14.000p
15,075,000 2,000,000 - - 17,075,000
--------------- ----------- ----------- -------- ----------------- ---------- ------------
Details of the share options and weighted average exercise price
(WAEP) during the years are as follows:
31 December 2021 31 December 2020
Number WAEP Number WAEP
Outstanding at the beginning
of the year 17,075,000 4.124p 15,075,000 2.814p
Share consolidation (13,660,000) 0.000p - -
Granted during the year 723,589 70.000p 2,000,000 14.000p
Exercised during the year (481,548) (37.79) - -
Lapsed during the year - - - -
Forfeited during the year - - - -
-------------- --------- ------------ ---------
3,657,041 28.13p 17,075,000 4.124p
-------------- --------- ------------ ---------
The weighted average contractual life of share options
outstanding as at 31 December 2021 was 6 years (31 December 2020: 6
years).
ITIM recognises equity settled share-based payment expenses
based on the fair value determined by the Black Scholes model. The
model is internationally recognised as being appropriate to value
employee share options schemes. The inputs into the option issues
were as follows:
Year ended Year ended
31 December 31 December
2021 2020
GBP000 GBP000
Share price 78p 14p
Exercise price 69p 14p
Expected volatility 25% 25%
Expected life 10 years 10 years
Risk free rate 0.5% 0.5%
Risk-free rate
The risk-free interest rate is based on the lower of the Bank of
England's base rate and 0.5%.
Volatility
The measure of volatility is based management's estimate after
considering the historical volatility of guideline companies
operating within the same industry as ITIM Group, over a 10-year
time period.
25. Company statement of changes in equity
Capital
Share options Redemption Retained
Share capital Share premium reserve Reserve losses Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP000
At 1 January 2020 2,379 10,469 213 - (3,062) 9,999
Total
comprehensive
income for the
year - - - - 1,189 1,189
Share options
exercised - - 91 - - 91
At 1 January 2021 2,379 10,469 304 - (1,873) 11,279
Total
comprehensive
income for the
year - - - - (501) (501)
Share option
charge - - 151 - - 151
Share buyback of
deferred shares (1,103) - - 1,103 - -
Cancellation of
share premium - (10,469) - - 10,469 -
Shares issued in
the period - IPO 260 7,740 - - - 8,000
Share option
conversion 25 156 - - - 181
IPO expenses - (498) - - - (498)
At 31 December
2021 1,561 7,398 455 1,103 8,095 18,612
The profit for the year dealt with in the financial statements
of the parent company is shown above. As permitted by section 408
of the Companies Act 2006, no separate income statement is
presented in respect of the parent company.
26. Pension commitments
The group makes contributions to individual pension schemes
(money purchase). The amount paid during the year was GBP209,553
(2020: GBP186,920). Outstanding contributions at the balance sheet
date amounted to GBP26,042 (2020: GBP23,148).
27. Contingent liabilities
itim Group plc and its subsidiary undertakings have given cross
guarantees and been granted rights to set-off in respect of group
undertaking overdrafts and loans.
The Company is party to a cross guarantee for amounts payable to
R M Frosell of GBPNil (2020: GBP350,000) by the Group.
28. Related party transactions
The Group has taken advantage of the exemption available under
IAS 2 Related Party Disclosures not to disclose details of
transactions between Group undertakings which are eliminated on
consolidation.
The loans made from the Directors are detailed in note 19.
29. Supporting statement for cash flows
Year ended 31 December Brought Cash Non Carried
2021 forward flow cash forward
Loans and borrowings (4,011) 3,757 (64) (318)
Leases (977) 355 (102) (724)
(2,861) 8,160 (169) 5,130
========== ======= ==================== ===========
Year ended 31 December Brought Cash Non Acquisition New Carried
2020 forward flow cash of sub loans forward
Loans and borrowings (1,627) - (46) (2,088) (250) (4,011)
Leases (1,737) 457 303 - - (977)
30. Controlling party
There is no single ultimate controlling party.
Notice of Annual General Meeting
Registered number: 03486926
ITIM GROUP PLC
NOTICE OF ANNUAL GENERAL MEETING
NOTICE IS HEREBY GIVEN that the annual general meeting of itim
Group plc (the "Company") will be held at the offices of DMH
Stallard LLP, 6 New Street Square, London EC4A 3BF on 20 June 2022
at 10.00 a.m. to consider and, if thought fit, to pass the
following resolutions, of which resolutions 1 to 11 (inclusive)
will be proposed as ordinary resolutions and resolutions 12 and 13
will be proposed as special resolutions. Resolutions 12 to 13
(inclusive) are items of special business.
ORDINARY RESOLUTIONS
1. To receive the Company's annual accounts for the financial
year ended 31 December 2021 together with the directors'
report, the directors' remuneration report and the auditors'
report on those accounts.
2. To re-appoint RPG Crouch Chapman LLP as auditors of the
Company to hold office until the conclusion of the next
annual general meeting of the Company to be held in 2023
and to authorise the directors to fix their remuneration.
3. To re-elect Sandra Ribeiro who, having been appointed
since the Company's last annual general meeting, retires
in accordance with article 77 of the articles of association
of the Company and who, being eligible, offers herself
for re-election as a director.
4. To re-elect Michael Jackson who, having been appointed
since the Company's last annual general meeting, retires
in accordance with article 77 of the articles of association
of the Company and who, being eligible, offers himself
for re-election as a director.
5. To re-elect Justin King who, having been appointed since
the Company's last annual general meeting, retires in
accordance with article 77 of the articles of association
of the Company and who, being eligible, offers himself
for re-election as a director.
6. To re-elect Lee Williams who, having been appointed since
the Company's last annual general meeting, retires in
accordance with article 77 of the articles of association
of the Company and who, being eligible, offers himself
for re-election as a director.
7. To re-elect Frank Lewis who, having been appointed since
the Company's last annual general meeting, retires in
accordance with article 77 of the articles of association
of the Company and who, being eligible, offers himself
for re-election as a director.
8. To re-elect Ian Hayes who, having been appointed since
the Company's last annual general meeting, retires in
accordance with article 77 of the articles of association
of the Company and who, being eligible, offers himself
for re-election as a director.
9. To re-elect Mahmood Ali Athar who, having been appointed
since the Company's last annual general meeting, retires
in accordance with article 77 of the articles of association
of the Company and who, being eligible, offers himself
for re-election as a director.
10. To re-elect Robert Frosell who, having been appointed
since the Company's last annual general meeting, retires
in accordance with article 77 of the articles of association
of the Company and who, being eligible, offers himself
for re-election as a director.
11. That, in substitution for any equivalent existing and
unexercised authorities and powers, the directors of
the Company be and they are hereby generally and unconditionally
authorised for the purpose of section 551 of the Companies
Act 2006 (the "Act") to exercise all or any of the powers
of the Company to allot shares of the Company or to grant
rights to subscribe for, or to convert any security into,
shares of the Company up to an aggregate nominal value
of GBP520,177 to such persons at such times and generally
on such terms and conditions as the directors may determine
(subject always to the articles of association of the
Company), provided that this authority shall, unless
previously renewed, varied or revoked by the Company
in general meeting, expire at the conclusion of the next
annual general meeting of the Company to be held in 2023
or, if earlier, 20 September 2023, save that the directors
of the Company may, before the expiry of such period,
make an offer or agreement which would or might require
such securities to be allotted after the expiry of such
period and the directors of the Company may allot such
securities in pursuance of such offer or agreement as
if the authority conferred hereby had not expired.
SPECIAL RESOLUTIONS
12. That, subject to and conditional upon the passing of
resolution 11 and in substitution for any equivalent
existing and unexercised authorities and powers, the
directors of the Company be and are hereby empowered
pursuant to sections 570 and 573 of the Act to allot
equity securities (as defined in section 560(1) of the
Act) for cash pursuant to the authority conferred upon
them by resolution 11 and/or where the allotment constitutes
an allotment of equity securities by virtue of section
560(3) of the Act, as if section 561 of the Act did not
apply to any such allotment provided that this authority
and power shall be limited to the allotment of equity
securities up to an aggregate nominal amount of GBP78,027
(representing approximately 5 per cent. of the current
issued share capital of the Company) provided that this
authority shall, unless previously renewed, varied or
revoked by the Company in general meeting, expire at
the conclusion of the next annual general meeting of
the Company to be held in 2023 or, if earlier, 20 September
2023, save that the directors of the Company may, before
the expiry of such period, make an offer or agreement
which would or might require such securities to be allotted
after the expiry of such period and the directors of
the Company may allot such securities in pursuance of
such offer or agreement as if the authority conferred
hereby had not expired.
13. That the Company be and is hereby generally and unconditionally
authorised for the purpose of section 701 of the Act
to make market purchases (within the meaning of section
693(4) of the Act) of ordinary shares in the capital
of the Company ("Ordinary Shares") provided that:
a) the maximum aggregate number of Ordinary Shares which
may be purchased is 3,121,060 (representing approximately
10 per cent. of the Company's existing issued share
capital);
b) the minimum price (exclusive of expenses) which may
be paid for each Ordinary Share is GBP0.05 (being
its nominal value);
c) the maximum price (exclusive of expenses) which may
be paid for each Ordinary Share is the higher of:
(i) an amount equal to 105 per cent. of the average
of the middle market quotations for an Ordinary Share
as derived from the Daily Official List of the London
Stock Exchange plc for the 5 business days immediately
preceding the day on which the Ordinary Share in question
is purchased; and (ii) the value of an Ordinary Share
calculated on the basis of the higher of the price
quoted for the last independent trade of an Ordinary
Share and the highest current independent bid for
an Ordinary Share as derived from the London Stock
Exchange Trading System;
d) unless previously renewed, revoked or varied, the
authority hereby conferred shall expire at the conclusion
of the next annual general meeting of the Company
to be held in 2023 or, if earlier, 20 September 2023;
and
e) the Company may make a contract or contracts to purchase
Ordinary Shares under the authority hereby conferred
prior to the expiry of such authority which contract
or contracts will or may be executed wholly or partly
after the expiry of such authority, and may make a
purchase of Ordinary Shares in pursuance
BY ORDER OF THE BOARD
Ian Hayes
Secretary
Date : 11(th) May 2022
Registered office: 2(nd) Floor Atlas House, 173 Victoria Street,
London, SW1E 5NH
NOTES:
1. Pursuant to the Company's Articles of Association, a
member of the Company entitled to attend and vote at
the meeting convened by this notice is entitled to appoint
one or more proxies to exercise any of his rights to
attend, speak and vote at that meeting on his behalf.
2. If a member appoints more than one proxy, each proxy
must be entitled to exercise the rights attached to different
shares. If you submit more than one valid proxy appointment
in respect of the same shares, the appointment received
last before the latest time for the receipt of proxies
will take precedence.
3. A proxy may only be appointed using the procedures set
out in these notes and the notes to the form of proxy.
To validly appoint a proxy, a member must complete, sign
and date the enclosed form of proxy and deposit it at
the office of the Company's registrars, Neville Registrars,
at Neville House, Steelpark Road, Halesowen, West Midlands
B62 8HD, by 10.00 a.m. on 16 June 2022 (or, in the event
that the meeting is adjourned, not less than 48 hours,
excluding non-working days, before the time fixed for
the holding of the adjourned meeting). Any power of attorney
or any other authority under which the form of proxy
is signed (or a duly certified copy of such power or
authority) must be enclosed with the form of proxy.
4. In order to revoke a proxy appointment, a member must
sign and date a notice clearly stating his intention
to revoke his proxy appointment and deposit it at the
office of the Company's registrars, Neville Registrars,
at Neville House, Steelpark Road, Halesowen, West Midlands
B62 8HD prior to commencement of the meeting. If the
revocation is received after the time specified, the
original proxy appointment will remain valid unless the
member attends the meeting and votes in person.
5. Pursuant to the Articles of Association, any corporation
which is a member of the Company may authorise one or
more persons (who need not be a member of the Company)
to attend, speak and vote at the meeting as the representative
of that corporation. A certified copy of the board resolution
of the corporation appointing the relevant person as
the representative of that corporation in connection
with the meeting must be deposited at the office of the
Company's registrars, Neville Registrars, at Neville
House, Steelpark Road, Halesowen, West Midlands B62 8HD
prior to the commencement of the meeting. If the revocation
is received after the time specified, the original corporate
representative appointment will remain valid unless the
member attends the meeting and votes in person.
6. In the case of joint holders, where more than one of
the joint holders purports to appoint a proxy in respect
of the same shares, only the appointment submitted by
the most senior holder will be accepted. Seniority is
determined by the order in which the names of the joint
holders appear in the Company's register of members in
respect of the joint holding (the first named being the
most senior).
7. The right to vote at the meeting shall be determined
by reference to the register of members of the Company.
Pursuant to Regulation 41 of the Uncertificated Securities
Regulations 2001 (as amended), only those persons whose
names are entered on the register of members of the Company
at 6.00 p.m. on 16 June 2022 (or, in the event of any
adjournment, at 6.00 p.m. on the date which is two business
days prior to the adjourned meeting) shall be entitled
to attend and vote in respect of the number of shares
registered in their names at that time. Changes to entries
on the register of members after that time shall be disregarded
in determining the rights of any person to vote at the
meeting.
8. CREST members who wish to appoint a proxy or proxies
through the CREST electronic proxy appointment service
may do so for the meeting and any adjournment(s) thereof
by using the procedures described in the CREST Manual
(available via www.euroclear.com ). CREST personal members
or other CREST sponsored members, and those CREST members
who have appointed a voting service provider(s), should
refer to their CREST sponsor or voting service provider(s),
who will be able to take the appropriate action on their
behalf.
9. In order for a proxy appointment or instruction made
by means of the CREST service to be valid, the appropriate
CREST message (a "CREST Proxy Instruction") must be properly
authenticated in accordance with Euroclear UK & Ireland
Limited's ("Euroclear") specifications and must contain
the information required for such instructions, as described
in the CREST Manual. The message, regardless of whether
it constitutes the appointment of a proxy or is an amendment
to the instruction given to a previously appointed proxy
must, in order to be valid, be transmitted so as to be
received by the Company's agent (ID 7RA11) by the latest
time for proxy appointments set out in paragraph 3 above.
For this purpose, the time of receipt will be taken to
be the time (as determined by the timestamp applied to
the message by the CREST Applications Host) from which
the Company's agent is able to retrieve the message by
enquiry to CREST in the manner prescribed by CREST. After
this time any change of instructions to proxies appointed
through CREST should be communicated to the appointee
through other means.
10. CREST members and, where applicable, their CREST sponsors
or voting service providers should note that Euroclear
does not make available special procedures in CREST for
any particular messages. Normal system timings and limitations
will therefore, apply in relation to the input of CREST
Proxy Instructions. It is the responsibility of the CREST
member concerned to take (or, if the CREST member is
a CREST personal member or sponsored member or has appointed
a voting service provider(s), to procure that his CREST
sponsor or voting service provider(s) take(s)) such action
as shall be necessary to ensure that a message is transmitted
by means of the CREST system by any particular time.
In this connection, CREST members and, where applicable,
their CREST sponsors or voting service providers are
referred, in particular, to those sections of the CREST
Manual concerning practical limitations of the CREST
system and timings. The Company may treat as invalid
a CREST Proxy Instruction in the circumstances set out
in Regulation 35(5)(a) of the Uncertificated Securities
Regulations 2001 (as amended).
11. As at 10(th) May 2022, the latest practicable date prior
to the date of this notice, the Company's issued share
capital consisted of 31,210,607 ordinary shares of GBP0.05
each, carrying one vote each and, therefore, the total
number of voting rights in the Company as at 10(th) May
2022 were 31,210,607.
12. You may not use any electronic address (within the meaning
of section 333(4) of the Companies Act 2006) provided
in this notice or in any related documents (including
the form of proxy and the annual report and accounts)
to communicate with the Company for any purposes other
than those expressly stated.
13. Your personal data includes all data provided by you,
or on your behalf, which related to you as a shareholder,
including your name and contact details, the votes you
cast and your reference number (as attributed to you
by the Company or its registrars). The Company determines
the purposes for which, and the manner in which, your
personal data is to be processed. The Company and any
third party to which it discloses the data (including
the Company's registrars) may process your personal data
for the purposes of compiling and updating the Company's
records, fulfilling its legal obligations and processing
the shareholder rights you exercise.
EXPLANATORY NOTES:
Resolutions 1 to 11 (inclusive) are proposed as ordinary
resolutions. For each of these to be passed, more than half of the
votes cast must be in favour of the relevant resolution.
Resolutions 12 and 13 are proposed as special resolutions. For
each of these resolutions to be passed, at least three quarters of
the votes cast must be in favour of the resolution. An explanation
of each of the resolutions is set out below:
Resolution 1 - Annual Report and Accounts
The Directors are required to present to the annual general
meeting the audited accounts and the Directors' and Auditors'
Reports for the financial year ended 31 December 2021.
Resolutions 2 - Auditors
The Company is required to appoint an auditor at every general
meeting of the Company at which accounts are presented to
shareholders. The appointment of RPG Crouch Chapman LLP.
Accordingly, this resolution proposes the re-appointment of RPG
Crouch Chapman LLP as the auditors of the Company. It is normal
practice for a company's directors to be authorised to agree how
much the auditors should be paid and Resolution 2 grants this
authority to the directors.
Resolutions 3 to 10 - Re-election of Directors
Article 77 of the Company's articles of association requires any
directors who have been appointed by the Board since the last
annual general meeting and any directors who were not appointed or
reappointed at one of the preceding two annual general meetings to
retire from office. Any such director is entitled to offer himself
for re-election.
Resolutions 11 and 12 - Directors' general power to allot
relevant securities
Resolution 11 is proposed to renew the directors' power to allot
shares.
Resolution 11 seeks to grant the directors authority to allot,
pursuant to section 551 of the Act, shares or grant rights to
subscribe for or to convert any security into shares in the Company
up an aggregate nominal value of GBP520,177 which is equal to one
third of the nominal value of the current issued ordinary share
capital of the Company as at 10(th) May 2022 (being the latest
practicable date prior to the publication of this notice). Unless
previously renewed, revoked or varied, the authorities sought under
this resolution will expire at the conclusion of the next annual
general meeting of the Company next annual general meeting of the
Company to be held in 2023 or 20 September 2023 (whichever is the
earlier). The Directors have no present intention of exercising
either of the authorities under this resolution, but the Board
wishes to ensure that the Company has maximum flexibility in
managing the financial resources of the Company. As at the date of
this notice, no shares are held by the Company in treasury.
Resolution 12 is to approve the partial disapplication of
pre-emption rights in respect of the allotment of equity securities
for cash. The passing of this resolution (together with resolution
11) would allow the directors to allot shares for cash and/or sell
treasury shares without first having to offer such shares to
existing shareholders in proportion to their existing holdings. The
authority would be limited to allotments or sales up to an
aggregate nominal amount of GBP78,027 which represents
approximately 5 per cent. of the nominal value of the current
issued ordinary share capital of the Company as at 10(th) May 2022
(being the latest practicable date prior to the publication of this
notice). Unless previously renewed, revoked or varied, the
authorities sought under this resolution will expire at the
conclusion of the next annual general meeting of the Company next
annual general meeting of the Company to be held in 2023 or 20
September 2023 (whichever is the earlier).
Resolution 13 - Authority for the market purchase by the Company
of its own shares
The authority sought by resolution 13 limits the number of
shares that could be purchased to a maximum of 3,121,060 ordinary
shares (equivalent to 10 per cent. of the Company's issued ordinary
share capital as at 10(th) May 2022 (being the latest practicable
date prior to the publication of this notice)) and sets a minimum
and maximum price. Unless previously renewed, revoked or varied,
the authority will expire at the conclusion of the annual general
meeting of the Company to be held in 2023 or 20 September 2023
(whichever is the earlier). The Directors have no present intention
of exercising the authority to purchase the Company's ordinary
shares but will keep the matter under review, taking into account
the financial resources of the Company, the Company's share price
and future funding opportunities. The Directors will exercise this
authority only when to do so would be in the best interests of the
Company and of its shareholders generally, and could be expected to
result in an increase in earnings per share of the Company. Any
purchases of ordinary shares would be by means of market purchase
through the London Stock Exchange plc. Any shares the Company buys
under this authority may either be cancelled or held in treasury.
Treasury shares can be re-sold for cash, cancelled or used for the
purposes of employee share schemes. No dividends are paid on shares
whilst held in treasury and no voting rights attach to treasury
shares. The Directors believe that it is desirable for the Company
to have this choice as holding the purchased shares as treasury
shares would give the Company the ability to re-sell or transfer
them in the future and so provide the Company with additional
flexibility in the management of its capital base.
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END
FR EAESFFEFAEAA
(END) Dow Jones Newswires
May 12, 2022 02:01 ET (06:01 GMT)
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