TIDMSBDS
RNS Number : 9009N
Silver Bullet Data Services Grp PLC
28 September 2023
28 September 2023
Silver Bullet Data Services Group plc
("Silverbullet" or the "Company", or, together with its
subsidiaries, the "Group")
Interim Results
Silverbullet (AIM: SBDS), a provider of digital transformation
services and products, is pleased to announce interim results for
the six months to 30 June 2023.
Financial Highlights
Six months to Six months to June
June 2023 2022
Revenue GBP4.16m GBP2.33m
Gross Profit GBP3.34m GBP1.63m
EBITDA* (GBP1.19m) (GBP3.41m)
Reported Loss before GBP1.83m GBP3.79m
tax
Earnings Per Share (GBP0.10) (GBP0.27)
*See note 3 of notes to the interim accounts
Operational Highlights
-- For the six months to June 2023, Silverbullet experienced
a period of strong revenue growth, with revenue having
increased by 79% to GBP4.16 million versus H1 2022
(2022: GBP2.33m).
-- Increased revenue driven by the expansion of services
to established customer base across the Group's three
key markets of US, UK and APAC, alongside new logo
wins; notably, over 35% of Group revenue in the period
was generated in the US market.
-- Revenue from '4D' Silverbullet's AI contextual data
platform has grown by 122% to GBP1.22m - driven predominantly
by significant growth in the US market.
-- Revenue from the Customer Experience Services unit
has grown by 65% to GBP2.94m - largely driven by growth
with existing clients.
-- Significantly reduced operating costs as a result
of strong cost management and the successful restructure
of the 4D team in late 2022 as the platform reached
key milestones on the product development roadmap.
Ian James, Chief Executive, commented: " We are pleased with the
continued positioning and development of the Company and with our
strong revenue growth and the reduction in costs leading to a
significantly improved overall position in H1 2023.
We have strong visibility on full-year revenues and continue to
carefully manage our investment in talent and other operating
costs. We are growing both revenues and customer base in the US,
where we believe there is significant further potential, and look
forward to increasing the proportion of total revenue contribution
in this market further in H2 2023. Whilst the demand by companies
for data and privacy services and products remains strong, we are
fully aware that the current global macro-economic environment
remains volatile and will run our business accordingly. At
Silverbullet, we have technology solutions that assist customers in
achieving their marketing and advertising objectives at lower cost
and with higher returns and hence, despite these challenging
macro-economic conditions, we continue to see robust demand from
clients.
As the Company matures, we are steadily moving toward a position
of positive EBITDA in early FY24. As a result, the Board is
optimistic about the outlook and views the future with
confidence."
For further information please contact:
Silverbullet via IFC
Ian James (CEO)
Strand Hanson Limited - Financial 0207 409
and Nominated Adviser 3494
James Spinney / James Bellman / Robert
Collins
0203 179
Oberon Capital - Broker 5344
Mike Seabrook / Chris Crawford /
Nick Lovering
020 3934
IFC Advisory 6630
Graham Herring / Tim Metcalfe / Florence 07793 839
Chandler 024
Chief Executive Officer's Report
Silverbullet is pleased to report that it has delivered a strong
set of results for the first half of 2023 in line with management
expectations, delivering significant revenue growth whilst reducing
its cost base when compared to the six months to June 2022.
In the period, the Company achieved revenue growth of 79% versus
H1 2022, with revenues of GBP4.16 million. The Group has
experienced growth across both Customer Experience Services (CX)
unit and 4D, its AI contextual data platform. This growth has been
achieved by expanding engagements with both new and established
clients across the Group's three key markets of US, UK and APAC, as
clients accelerate their data driven marketing transformations.
During the same period, whilst maintaining investment in key
talent in the CX Services division in order to deliver the revenue
growth, the Company reduced the overall operating costs by 8% to
GBP4.98m. This has been achieved through tight cost management and
as a result of the successful restructure of the 4D team in late
2022 in line with achieving product roadmap milestones.
As the business importance of customer data (accelerated by AI)
continues to increase, Silverbullet is well positioned as a leading
Data-Driven Customer Experience (CX) company. Silverbullet sits at
the centre of the data ecosystem to enable its clients such as
Heineken, Mars, Sony and Omnicom to deliver marketing
transformation through unlocking the value of customer data,
marketing technology and AI driven advertising tools.
As consumer demand for data privacy increases, the Group enables
its clients to better communicate with their customers in a privacy
first way whilst maximising the marketing ROI from data and
marketing technology.
The business is comprised of two divisions:
o Customer Experience (CX) Services : Professional services
specialising in the delivery of data transformations
and customer journey orchestration on behalf of global
clients. Silverbullet's trusted data transformation experts
enable businesses to curate their CX strategies, utilising
right data and marketing technology in order to engage
customers across a variety of digital marketing channels
(including owned and paid).
o 4D, AI contextual data Platform: The privacy-first AI
contextual targeting and insights platform that enables
the delivery of display, video and CTV ad campaigns in
environments consumers trust. 4D brings together the
most advanced machine learning and AI technologies to
help brands engage customers at the right place, right
time, and in the right moment - all the while respecting
their privacy and legal rights as consumers.
Customer Experience (CX) Services
Silverbullet's Customer Experience (CX) Services division
achieved growth of 65% during the period with revenues growing to
GBP2.94m. This has largely been driven by securing additional
contracts and increased scopes of work with existing global
clients. In particular, multi-brand international clients such as
Heineken, Sony and Mars continue to adopt more services from
Silverbullet as the Group expands its services offering, product
suite and geographical footprint.
Silverbullet's partnerships with a number of global
enterprise-marketing software companies, such as Salesforce and
Snowflake, continue to thrive, ensuring clients establish long-term
transformational data infrastructures which can be systematically
replicated, with the help of Silvebullet CX services, in additional
geographical markets and new brands. This expansion, in turn,
provides Silverbullet with robust pipeline and services expansion
opportunities with new and established clients.
4D, AI contextual data platform
4D, Silverbullet's AI contextual data targeting and insights
platform, has delivered exceptional growth in the period, with
revenues growing by 122% versus H1 2022 to GBP1.22m. This has
largely been driven by the managed service offering in the US
market. Having achieved maturity in the development of the 4D AI
platform in late 2022, the Group is focusing its efforts and
investment on commercial growth opportunities as clients and their
media agencies focus on solutions for advertising privacy concerns
whilst improving digital advertising ROI.
Multiple clients regularly used the platform in the period,
including a leading insurance company, a global electronics
manufacturer and a US Government Body, providing a solid foundation
for growth moving forward.
With the 4D AI contextual data platform, established management
is now focused on developing new client use-cases and partnerships,
especially around Online Video and Connected TV, opening up new
revenue opportunities. In May 2023, the Group announced its first
4D reseller contract with Silverpush Global Pte Ltd, a global
leader in cookieless and AI powered advertising solutions, with 18
offices worldwide. This partnership significantly increases 4Ds
global sales reach. A number of clients have started to test 4D via
this partnership and a pipeline of new clients is steadily
building.
Outlook
We are pleased with the continued positioning and development of
the Company and with our strong revenue growth and the reduction in
costs leading to a significantly improved overall position in H1
2023.
We have strong visibility on full-year revenues and continue to
carefully manage our investment in talent and other operating
costs. We are growing both revenues and our customer base in the
US, where we believe there is significant growth potential, and
look forward to increasing the proportion of total revenue
contribution in this market further in H2 2023. Whilst the demand
by companies for data and privacy services and products remain
strong, we are fully aware that the current global environment
remains volatile and will run our business accordingly. At
Silverbullet, we have services and technology solutions that assist
customers in achieving their marketing and advertising objectives
at lower cost and with higher returns and hence, despite these
challenging macro-economic conditions, we continue to see robust
demand from clients.
As the Company matures, we are steadily moving toward a position
of positive EBITDA in early FY24. As a result, the Board is
optimistic about the outlook and views the future with
confidence.
Ian James
Chief Executive Officer and Director
Consolidated Statement of Comprehensive Income
Note Six months Six months
ended 30 ended 30
June 2023 June 2022
GBP GBP
Revenue 3 4,163,247 2,331,391
Cost of sales (821,208) (704,336)
Gross profit 3,342,039 1,627,055
Other operating income - 23,587
Distribution costs (453,392) (372,669)
Administrative expenses (4,524,003) (5,051,431)
Operating loss (1,635,356) (3,773,458)
Finance expense (196,822) (19,776)
------------ ------------
Loss before taxation (1,832,178) (3,793,234)
Taxation 167,331 146,173
------------ ------------
Loss after taxation attributable to
the equity shareholders of the company (1,664,847) (3,647,061)
Other comprehensive (loss) net of
taxation
Currency translation differences (11,904) (32,966)
Total comprehensive loss for the year (1,676,751) (3,680,027)
============ ============
Total comprehensive loss attributable
to:
Shareholders of the company (1,680,718) (3,680,039)
Non-controlling interest 3,967 12
------------ ------------
(1,676,751) (3,680,027)
------------ ------------
Earnings per share
Basic earnings 5 (0.10) (0.27)
Diluted earnings 5 (0.10) (0.27)
Consolidated Statement of Financial Position
At 30 At 31 At 30
June 2023 December June 2022
2022
Note GBP GBP GBP
Non-current assets
Goodwill 6 4,349,662 4,349,662 4,349,662
Intangible assets 6 2,226,359 2,544,739 2,501,680
Investments 4,999 4,999 -
Property, plant and equipment 46,230 53,809 53,616
------------ ------------ ------------
Total non-current assets 6,627,250 6,953,209 6,904,958
Current assets
Trade and other receivables 3,109,469 2,487,844 2,836,163
Cash and cash equivalents 677,622 1,352,221 3,156,919
------------ ------------ ------------
Total current assets 3,787,091 3,840,065 5,993,082
Total Assets 10,414,341 10,793,274 12,898,040
------------ ------------ ------------
Current liabilities
Trade and other payables 2,547,803 2,311,754 2,475,649
Loans and other borrowings 372,462 41,227 36,237
------------ ------------
Total current liabilities 2,920,265 2,352,981 2,511,886
------------ ------------ ------------
Non-current liabilities
Loans and borrowings 2,324,121 1,797,992 1,633,751
Deferred tax liability 4 553,170 632,190 620,851
------------ ------------ ------------
Total non-current liabilities 2,877,291 2,430,182 2,254,602
------------ ------------ ------------
Total liabilities 5,797,556 4,783,163 4,766,488
------------ ------------ ------------
Net assets 4,616,785 6,010,111 8,131,552
============ ============ ============
Equity
Share capital 8 159,367 159,367 159,167
Share premium 10,821,021 10,821,021 10,795,153
Share option reserve 9 2,570,666 2,396,396 1,671,767
Other reserves 440,695 398,954 -
Retained earnings (9,280,584) (7,679,183) (4,458,427)
Capital redemption reserve 50 50 50
Foreign exchange reserve (104,644) (92,741) (41,471)
Equity attributable to the
equity shareholders of the company 4,606,571 6,003,864 8,126,239
------------ ------------ ------------
Non-controlling interest 10,214 6,247 5,313
Total equity 4,616,785 6,010,111 8,131,552
============ ============ ============
Consolidated Statement of Cash Flows
Six months Six months
ended 30 ended 30
June 2023 June 2022
GBP GBP
Cash flows from operating activities
(Loss) after tax (1,664,847) (3,647,061)
Adjustments for:
Depreciation 15,200 14,891
Amortisation 431,668 353,307
Foreign exchange (11,903) (32,966)
Net finance expense 196,821 19,776
Taxation expense (167,331) (146,173)
Increase in trade and other receivables (621,625) (128,371)
(Decrease) / increase in trade and other
payables 51,445 (388,215)
Share option charge 241,684 396,404
(Decrease) / increase in deferred tax
liability (79,020) 72,959
------------ ------------
Cash generated from operations (1,607,908) (3,485,449)
Taxation refunded 351,936 401,009
------------ ------------
Net cash used in operating activities (1,255,972) (3,084,440)
============ ============
Cash flows from investing activities
Purchase of property, plant and equipment (7,621) (26,391)
Purchase of intangible assets (113,288) (648,245)
------------ ------------
Net cash used in investing activities (120,909) (674,636)
============ ============
Cash flows from financing activities
Proceeds from borrowings 711,010 1,510,282
Repayments of borrowings (20,296) -
Equity in convertible loan notes issued 41,741 -
New equity issued (net of transaction
costs) - 1,737,680
Interest paid (30,173) (19,776)
Net cash from financing activities 702,282 3,228,186
============ ============
Net increase in cash and cash equivalents (674,599) (530,890)
Cash and cash equivalents at beginning
of period 1,352,221 3,687,809
------------ ------------
Cash and cash equivalents at end of period 677,622 3,156,919
============ ============
Consolidated Statement of Changes in Equity attributable
to the shareholders
Share Share Share Other Retained Capital Foreign Total equity Non-controlling Total
Capital premium Option reserves earnings redemption exchange attributable interest equity
Reserve reserve reserve to
shareholders
GBP GBP GBP GBP GBP GBP GBP GBP
As at 1 January 2022 134,227 8,639,593 1,275,363 - (811,354) 50 (8,505) 9,229,374 5,301 9,234,675
Total comprehensive
loss
for the period - - - - (3,647,073) - (32,966) (3,680,039) 12 (3,680,027)
Share option charge - - 396,404 - - - - 396,404 - 396,404
Shares issued during
period
(net of transaction
costs) 24,940 2,155,560 - - - - - 2,180,500 - 2,180,500
-------- ----------- ---------- ---------- ------------ ----------- ---------- ------------- ---------------- ------------
As at 30 June 2022 159,167 10,795,153 1,671,767 - (4,458,427) 50 (41,471) 8,126,239 5,313 8,131,552
Total comprehensive
loss
for the period - - - - (3,575,906) - (51,270) (3,627,176) 934 (3,626,242)
Convertible loan
notes
issued - - - 398,954 - - - 398,954 - 398,954
Share option charge - - 1,079,779 - - - - 1,079,779 - 1,079,779
Share options
exercised 200 - (46,739) - 46,739 - - 200 - 200
Share options
forfeited/lapsed - - (308,411) - 308,411 - - - - -
Shares issued during
period
(net of transaction
costs) - 25,868 - - - - - 25,868 - 25,868
-------- ----------- ---------- ---------- ------------ ----------- ---------- ------------- ---------------- ------------
As at 31 December
2022 159,367 10,821,021 2,396,396 398,954 (7,679,183) 50 (92,741) 6,003,864 6,247 6,010,111
Total comprehensive
loss
for the period - - - - (1,668,815) - (11,903) (1,680,718) 3,967 (1,676,751)
Share option charge - - 241,684 - - - 241,684 - 241,684
Share options
forfeited/lapsed - - (67,414) - 67,414 - - - - -
Convertible loan
notes
issued - - - 41,741 - - - 41,741 - 41,741
As at 30 June 2023 159,367 10,821,021 2,570,666 440,695 (9,280,584) 50 (104,644) 4,606,571 10,214 4,616,785
======== =========== ========== ========== ============ =========== ========== ============= ================ ============
Notes to the Interim Accounts
1. Description of business, basis of preparation and going concern
GENERAL INFORMATION
Silver Bullet Data Services Group PLC ("SBDS") was incorporated
on 13 May 2013. SBDS is a limited liability company incorporated in
England and Wales and domiciled in the UK. The address of the
registered office is The Harley Building, 77 New Cavendish Street,
London, W1W 6XB.
The principal activity of the SBDS Group is marketing services
through the application of big data technologies to reduce
friction.
BASIS OF PREPARATION
The interim consolidated financial statements have been prepared
in accordance with International Accounting Standard (IAS) 34,
Interim Financial Reporting. These interim financial statements
have been prepared in accordance with those UK adopted
International Accounting Standards (IAS) in conformity with the
requirements of the Companies Act 2006 and IFRIC interpretations
issued and effective or issued and early adopted as at the time of
preparing these statements.
These consolidated interim financial statements have been
prepared in accordance with the accounting policies set out below,
which have been consistently applied to all the periods
presented.
The preparation of these interim financial statements in
accordance with International Accounting Standards in conformity
with the requirements of the Companies Act 2006 requires the use of
certain accounting estimates. It also requires management to
exercise judgement in the process of applying the Group's
accounting policies. The areas involving a high degree of judgement
or complexity, or areas where the assumptions and estimates are
significant to the consolidated interim financial statements are
disclosed in Note 2.
The financial information contained in this report, which has
not been audited, does not constitute statutory accounts as defined
by Section 434 of the Companies Act 2006.
The presentational currency of the Group is GBP with functional
currencies of the subsidiaries being GBP, EUR, AUD, and USD.
GOING CONCERN
The directors have prepared detailed budgets and forecasts
covering the period to 31 December 2025 which are based on the
strategic business plan. These take into account all reasonably
foreseeable circumstances and include consideration of trading
results, cash flows and the level of facilities the group requires
on a month-by-month basis.
Whilst the directors have plans in place to manage any
reasonably foreseeable circumstances, they forecast there will be a
need for additional funding in the short-term. The directors are
confident that the Group will be able to raise any required funds
to meet their strategic objectives however there is an uncertainty
over how much funding may be raised when required. However as
securing new funding cannot be assured, a material uncertainty
exists related to the group or company's ability to continue as a
going concern.
Based on their enquiries and the information available to them
and taking into account the other risks and uncertainties set out
herein, the directors have a reasonable expectation that the
Company and the Group has or will be able to secure adequate
resources to continue operating for the foreseeable future. Thus,
they continue to adopt the going concern basis of accounting in
preparing this financial information.
2. Significant accounting policies
SIGNIFICANT ACCOUNTING ESTIMATES AND ASSUMPTIONS
The preparation of the interim financial statements in
accordance with IFRS requires the use of estimates and assumptions
to be made in applying the accounting policies that affect the
reported amounts of assets, liabilities, revenue and expenses and
the disclosure of contingent assets and
liabilities. The estimates and related assumptions are based on
previous experiences and other factors considered reasonable under
the circumstances, the results of which form the basis for making
the assumptions about the carrying values of assets and liabilities
that are not readily apparent from other sources.
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 affects
only that period or in the period of the revision and future
periods if the revision affects both current and future
periods.
Significant accounts that require estimates as the basis for
determining the stated amounts include performance obligations
surrounding revenue recognition and the valuation assumptions in
calculating the impairment of goodwill and intangible assets.
REVENUE RECOGNITION
IFRS 15 - Revenue from Contracts with Customers has been applied
for all periods presented within the financial statements. The
timing of all revenue recognised by the Group during the reporting
period was satisfied over time in accordance with IFRS 15
recognition criteria. None of the Group's activities result in the
transfer of control of a product at a point in time for revenue
recognition purposes.
During the period under review the Group recognised revenue from
the following activities:
Customer Experience Services
Revenue relating to service contracts is invoiced according to
milestones defined within each contract, the terms of which vary on
a case-by-case basis. In all cases the revenue is recognised in
line with the provision of the services or, where the quantum and
timing of the services cannot be reliably predicted, rateable over
the period of the agreement.
Invoices against services contracts are raised on a monthly
basis with adjustments for accrued or deferred income where the
agreed invoicing timescale does not match the valuation of
provision of services.
4D contextual targeting and insights platform
Amounts received or receivable for campaigns, typically invoiced
on a monthly basis, recognise revenue in proportion to the quantum
of advertising units delivered according to the contracted service.
Units and metrics deliverable under each contracted services will
vary on a case-by-case basis.
Contract liabilities
Contract liabilities are recognised when payment from a customer
is received in advance of performance obligations being satisfied.
Contract liabilities are recognised in trade and other
payables.
BUSINESS COMBINATIONS
Silver Bullet Data Services Group PLC applies the acquisition
method of accounting to account for business combinations in
accordance with IFRS 3, 'Business Combinations'.
The consideration transferred for the acquisition of a
subsidiary is the fair values of the assets transferred, the
liabilities incurred and the equity interests issued by Silver
Bullet Data Services Group PLC. The consideration transferred
includes the fair value of any asset or liability resulting from a
contingent consideration arrangement. Identifiable assets acquired
and liabilities and contingent liabilities assumed in a business
combination are measured initially at their fair values at the
acquisition date. The excess of the consideration transferred over
the fair value of Silver Bullet Data Services Group PLC's share of
the identifiable net assets acquired is recorded as goodwill. All
transaction related costs are expensed in the period they are
incurred as exceptional operating expenses.
TAXES
Corporation tax, where payable, is provided on taxable profits
at the current rate.
Deferred tax is provided on all temporary differences at the
reporting date between the tax bases of assets and liabilities and
their carrying amounts for financial reporting purposes.
Deferred tax assets are recognised for all deductible temporary
differences, carry-forward of unused tax assets 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 assets and unused tax losses
can be utilised. The carrying amount of deferred tax assets is
reviewed at each balance sheet 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.
Deferred tax assets and liabilities are offset when there is a
legally enforceable right to offset current tax assets against
current tax liabilities, and when the deferred tax assets and
liabilities relate to taxes levied by the same taxation authority
on either the taxable entity or different taxable entities where
there is an intention to settle the balances on a net basis.
Deferred tax assets and liabilities are measured at the tax
rates that are expected to apply to the year when the asset is
realised or the liability is settled, based on tax rates (and tax
laws) that have been enacted or substantively enacted at the
balance sheet date.
FOREIGN CURRENCY TRANSLATION
Transactions in currencies other than the functional currency
(foreign currencies) are initially recorded at the exchange rate
prevailing on the date of the transaction.
Monetary assets and liabilities denominated in foreign
currencies are translated at the rate of exchange ruling at the
reporting date. Non-monetary assets and liabilities denominated in
foreign currencies are translated at the rate ruling at the date of
the transaction, or, if the asset or liability is measured at fair
value, the rate when that fair value was determined.
All translation differences are taken to profit or loss, except
to the extent that they relate to gains or losses on non-monetary
items recognised in other comprehensive income, when the related
translation gain or loss is also recognised in other comprehensive
income.
INTANGIBLE ASSETS AND GOODWILL
Goodwill
Goodwill is initially measured at fair value, being the excess
of the aggregate of the consideration transferred over the fair
value of the net assets acquired, and any previous interest held
over the net identifiable assets acquired and liabilities assumed.
After initial recognition, goodwill is measured at cost less any
accumulated impairment losses. The goodwill is tested annually for
impairment irrespective of whether there is an indication of
impairment.
For the purposes of impairment testing, goodwill is allocated to
the cash-generating units expected to benefit from the acquisition.
Cash-generating units to which goodwill has been allocated are
tested for impairment at least 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 the
carrying amount of the unit, 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 on the basis of
the carrying amount of each asset in the unit.
Intangible assets (other than goodwill)
Intangible assets acquired separately from a business are
recognised at cost and are subsequently measured at cost less
accumulated amortisation and accumulated impairment losses.
Intangible assets acquired on business combinations are recognised
separately from goodwill at the acquisition date if the fair value
can be measured reliably.
Amortisation is recognised so as to write off the cost or
valuation of assets less their residual values over their useful
lives on the following bases:
Development - Straight line basis over 5 years
costs
Customer lists - Straight line basis over 4 years
PROPERTY PLANT AND EQUIPMENT
Property, plant and equipment are stated at cost net of
accumulated depreciation and accumulated impairment losses. Cost
comprises purchase cost together with any incidental costs of
acquisition.
Depreciation is provided to write down the cost less the
estimated residual value of all tangible fixed assets by equal
instalments over their estimated useful economic lives on a
straight-line basis. The following rates are applied:
Computer equipment - Straight line over 3 years
Fixtures, fittings - Reducing balance over 4 years
and equipment
IMPAIRMENT OF NON-CURRENT ASSETS
At each reporting period end date, the Group reviews the
carrying amounts of its tangible and intangible assets to determine
whether there is any indication that those assets have suffered an
impairment loss. If any such indication exists, the recoverable
amount of the asset is estimated in order to determine the extent
of the impairment loss (if any). Where it is not possible to
estimate the recoverable amount of an individual asset, the company
estimates the recoverable amount of the cash-generating unit to
which the asset belongs.
Recoverable amount is the higher of fair value less costs to
sell and value in use. In assessing value in use, the estimated
future cash flows are discounted to their present value using a
pre-tax discount rate that reflects current market assessments of
the time value of money and the risks specific to the asset for
which the estimates of future cash flows have not been
adjusted.
If the recoverable amount of an asset (or cash-generating unit)
is estimated to be less than its carrying amount, the carrying
amount of the asset (or cash-generating unit) is reduced to its
recoverable amount. An impairment loss is recognised immediately in
the statement of comprehensive income.
Recognised impairment losses are reversed if, and only if, the
reasons for the impairment loss have ceased to apply. Where an
impairment loss subsequently reverses, the carrying amount of the
asset (or cash-generating unit) is increased to the revised
estimate of its recoverable amount, but so that the increased
carrying amount does not exceed the carrying amount that would have
been determined had no impairment loss been recognised for the
asset (or cash-generating unit) in prior years. A reversal of an
impairment loss is recognised immediately in profit or loss.
RESEARCH AND DEVELOPMENT EXPITURE
Research expenditure is written off against profits in the year
in which it is incurred. Identifiable development expenditure is
capitalised to the extent that the technical, commercial and
financial feasibility can be demonstrated.
Development costs relate to the internally developed platform
held by the group which is expected to generate future revenue
streams.
FINANCIAL INSTRUMENTS
Silver Bullet Data Services Group PLC classifies financial
instruments, or their component parts, on initial recognition as a
financial asset, a financial liability or an equity instrument in
accordance with the substance of the contractual arrangement.
Financial instruments are recognised on the date when the Group
becomes a party to the contractual provisions of the instrument.
Financial instruments are recognised initially at fair value plus,
in the case of a financial instrument not a fair value through
profit and loss, transaction costs that are directly attributable
to the acquisition or issue of the financial instrument. Financial
instruments are derecognised on the settlement date when the Group
is no longer a party to the contractual provisions of the
instrument.
Non-derivative financial instruments comprise trade and other
receivables, cash and cash equivalents, loans and borrowings, and
trade and other payables.
Trade and other receivables and trade and other payables
Trade and other receivables are recognised initially at
transaction price less attributable transaction costs. Trade and
other payables are recognised initially at transaction price plus
attributable transaction costs. Subsequent to initial recognition
they are measured at amortised cost using the effective interest
method, less any expected credit losses in the case of trade
receivables. If the arrangement constitutes a financing
transaction, for example if payment is deferred beyond normal
business terms, then it is measured at the present value of future
payments discounted at a market rate of interest for a similar debt
instrument.
Contract assets
Contract assets are recognised when revenue is recognised but
payment is conditional on a basis other than the passage of time.
Contract assets are included in trade and other receivables.
Contract liabilities
Contract liabilities are recognised when payment from a customer
is received in advance of performance obligations being satisfied.
Contract liabilities are recognised in trade and other
payables.
Interest-bearing borrowings
Interest-bearing borrowings are recognised initially at the
present value of future payments discounted at a market rate of
interest. Subsequent to initial recognition, interest-bearing
borrowings are stated at amortised costs using the effective
interest method, less any impairment losses.
Cash and cash equivalents
Cash and cash equivalents comprise cash balances and call
deposits. Bank overdrafts that are repayable on demand form an
integral part of the Group's cash management and are included as a
component of cash and cash equivalents for the purpose only on the
cash flow statement.
Convertible loan notes
Liability instruments that are convertible into equity shares
either mandatorily or at the option of the holder, are split into
liability and equity components. The liability element is
determined by the fair value of the cash flows excluding any equity
component; with the residual assigned to equity.
PROVISIONS
A provision is recognised in the statement of financial position
when the Group has a present legal or constructive obligation as a
result of a past event, that can be reliably measured and it is
probable that an outflow of economic benefits will be required to
settle the obligation. Provisions are determined by discounting the
expected future cash flows at a pre-tax rate that reflects risks
specific to the liability. Where the effect of the time value of
money is material, the amount expected to be required to settle the
obligation is recognised at present value. When a provision is
measured at present value, the unwinding of the discount is
recognised as a finance cost in profit or loss in the period in
which it arises.
EMPLOYEE BENEFITS
During the period the Group operated a defined contribution
money purchase pension scheme under which it pays contributions
based upon a percentage of the members' basic salary. The Group
also paid other employee benefits including medical insurance.
All employee benefits are charged to the Statement of
Comprehensive Income and differences between contributions payable
in the year and contributions actually paid are shown as either
accruals or prepayments.
LEASES
The Group leases a number of properties in various locations in
Europe, Australia, USA, and the UK from which it operates.
All leases are accounted for by recognising a right-of-use asset
and a lease liability except for:
- Leases of low value assets; and
- Leases with a duration of twelve months or less.
All leases signed by the Group during the reporting period were
for a period of less than twelve months so no right-of-use assets
have been recognised.
GRANT INCOME
Grant income is 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 related costs, for which it is intended to compensate, are
expensed. When the grant relates to an asset, it is recognised as
income in equal amounts over the expected useful life of the
related asset.
SHARE-BASED PAYMENTS
The Group operates a share option programme which allows
employees of the subsidiary companies to be granted options to
purchase shares in this company. The fair value of options granted
is recognised as an employment expense with a corresponding
increase in equity.
The particular terms of the share options state that they can
only be exercised by employees in the event of an exit where the
company is either sold to a third party, wound up or floated on a
public stock exchange. The fair value of the options is measured at
the grant date and spread over the vesting period. The fair value
is measured based on an option pricing model taking into account
the terms and conditions upon which the instruments were
granted.
Vesting periods in each share option agreement vary from vesting
immediately on grant date to vesting over a period of four
years.
FINANCE INCOME AND EXPENSES
Finance expenses comprise interest payable and leases
liabilities recognised in the statement of comprehensive income
using the effective interest method, and unwinding of the discount
on provisions.
Interest income and interest payable are recognised in the
statement of comprehensive income as they accrue, using the
effective interest method.
INTERIM MEASUREMENT
Costs that are incurred unevenly during the financial year are
accrued or deferred in the interim report only if it would be
appropriate to do so at the end of the financial year.
CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS
The preparation of these financial statements requires the
Directors to make estimates and judgements that affect the reported
amounts of assets, liabilities, costs and revenue in the financial
statements. Actual results could differ from these estimates. The
judgements, estimates and associated assumptions are based on
historical experience and other factors that are considered to be
relevant.
Key sources of estimation uncertainty that could cause an
adjustment to be required to the carrying amount of assets or
liabilities within the next accounting period are:
Critical accounting estimates:
Amortisation
The assessment of the useful economic lives, residual values and
the method of depreciating or amortising intangible (excluding
goodwill) fixed assets requires judgement. Amortisation is charged
to profit or loss based on the useful economic life selected, which
requires an estimation of the period and profile over which the
group expects to consume the future economic benefits embodied in
the assets. Useful economic lives and residual values are
re-assessed, and amended as necessary, when changes in their
circumstances are identified.
Capitalised development costs
Development costs incurred in building the Group's key platform
for future expansion have been capitalised in accordance with the
requirements of IAS38. The majority of these costs consist of
salary expenses to which an estimated proportion of development
time has been applied.
Impairment of intangible fixed assets
Impairment tests have been undertaken in respect of goodwill and
intangible fixed assets using an assessment of the value in use of
the respective cash generating units (CGUs). This assessment
requires a number of assumptions and estimates to be made including
the allocation of assets of CGUs, the expected future cash flows
from each CGU and also the selection of a suitable discount rate in
order to calculate the present value of those cash flows.
Impairment of trade receivables
The Group's policy on recognising an impairment of the trade
receivables balance is based on a review of individual receivable
balances, their ageing and management's assessment of realisation.
This review and assessment is conducted on a continuing basis and
any material change in management's assessment of trade receivable
impairment is reflected in the carrying value of the asset.
Critical accounting judgements:
Convertible loan note
The equity portion of the convertible loan notes in issue have
been valued using the Black-Scholes model. This gives equivalent
discount rates on the liability components ranging from 16% to 21%.
The directors consider these rates to be an approximation of the
rate on a similar loan without the conversion feature.
Going concern
As discussed more fully in the Directors' Report these financial
statements have been prepared on the going concern basis. This
treatment is based on management's judgement that cashflow
requirements for the continued development can be achieved through
operating activities and through additional fundraising if
required.
3. Operating segments
IFRS 8 requires that operating segments be identified on the
basis of internal reporting and decision-making. The Group has two
key business segments outlined below. The business analyses these
streams by revenue and gross margin. Overheads, assets and
liabilities are not separately allocated across the business
streams.
Six months ended Six months ended
30 June 2023 30 June 2022
Revenue Gross Revenue Gross
profit profit/(loss)
GBP GBP GBP GBP
Customer Experience
Services 2,939,841 2,881,498 1,780,598 1,636,471
4D Platform 1,223,406 460,541 550,793 (9,416)
Total 4,163,247 3,342,039 2,331,391 1,627,055
---------- ------------ ---------- ---------------
EBITDA from continuing operations
Operating (loss) (1,635,356) (3,773,458)
Depreciation and amortisation 446,868 368,198
Total (1,188,488) (3,405,260)
============ ===============
4. Income tax
A deferred tax asset in respect of the Group's cumulative losses
to date has not been recognised due to the uncertainty of the
timing of future loss relief. Deferred tax movements during the
period relate solely to the change in value of internally generated
intangible fixed assets.
Research and development tax relief claims under the SME scheme
are submitted at each financial year end. Anticipated tax credits
for the period under review totalling GBP98,064 (June 2022:
GBP150,000) are held within other receivables.
5. Earnings per share
Earnings per share (EPS) is calculated on the basis of profit
attributable to equity shareholders divided by the weighted average
number of shares in issue for the year. The diluted EPS is
calculated on the treasury stock method and the assumption that the
weighted average EMI share options outstanding during the period
are exercised.
Six months Six months
ended 30 ended 30
June 2023 June 2022
GBP GBP
Total losses after taxation attributable
to shareholders 1,668,814 3,647,073
Number of shares
Weighted average number of ordinary
shares 15,936,687 13,630,520
Dilutive effect of in-the-money
share options 523,218 547,960
Diluted weighted average number
of shares 16,459,905 14,178,480
----------- -----------
Earnings per share
Basic earnings per share (0.10) (0.27)
Diluted earnings per share (0.10) (0.27)
As there is a loss for the year the options are antidilutive and
therefore the basic and the diluted EPS are the same.
6. Goodwill and intangible assets
Customer Development Websites Goodwill Total
lists Costs
GBP GBP GBP GBP GBP
COST
At 1 January 2022 595,708 2,480,154 17,850 4,349,662 7,443,374
Additions - 643,100 5,145 - 648,245
At 30 June 2022 595,708 3,123,254 22,995 4,349,662 8,091,619
--------- ------------ --------- ---------- ----------
At 1 July 2022 595,708 3,123,254 22,995 4,349,662 8,091,619
Additions - 450,817 - - 450,817
At 31 December 2022 595,708 3,574,071 22,995 4,349,662 8,542,436
--------- ------------ --------- ---------- ----------
At 1 January 2023 595,708 3,574,071 22,995 4,349,662 8,542,436
Additions - 113,288 - - 113,288
At 30 June 2023 595,708 3,687,359 22,995 4,349,662 8,655,724
--------- ------------ --------- ---------- ----------
AMORTISATION
At 1 January 2022 362,790 521,502 2,678 - 886,970
Amortisation charge 74,464 276,801 2,042 - 353,307
At 30 June 2022 437,254 798,303 4,720 - 1,240,277
--------- ------------ --------- ---------- ----------
At 1 July 2022 437,254 798,303 4,720 - 1,240,277
Amortisation charge 74,463 330,996 2,299 - 407,758
At 31 December 2022 511,717 1,129,299 7,019 - 1,648,035
--------- ------------ --------- ---------- ----------
At 1 January 2023 511,717 1,129,299 7,019 - 1,648,035
Amortisation charge 74,464 354,904 2,300 - 431,668
At 30 June 2023 586,181 1,484,203 9,319 - 2,079,703
--------- ------------ --------- ---------- ----------
NET BOOK VALUE
At 30 June 2022 158,454 2,324,951 18,275 4,349,662 6,851,342
========= ============ ========= ========== ==========
At 31 December 2022 83,991 2,444,772 15,976 4,349,662 6,894,401
========= ============ ========= ========== ==========
At 30 June 2023 9,527 2,203,156 13,676 4,349,662 6,576,021
========= ============ ========= ========== ==========
7. Loans and other borrowings
30 June 31 December 30 June
2023 2022 2022
GBP GBP GBP
Current liabilities
Bank loans 372,462 41,227 36,237
372,462 41,227 36,237
========== ============ ==========
30 June 31 December 30 June
2023 2022 2022
GBP GBP GBP
Non-current liabilities
Convertible loan notes 2,237,569 1,687,697 1,507,000
Bank loans 86,552 110,295 126,750
2,324,121 1,797,992 1,633,750
========== ============ ==========
As at 30 June 2023 the Group had two bank loans totalling
GBP459,014 (June 2022: GBP151,522). One loan accrues interest at
1.95% per annum repayable over six years to 2026, the other loan
balance is payable in equal instalments over a period of six months
accruing annual interest rates ranging from 10.9% to 11.2%.
Convertible loan notes totalling GBP500,000 were issued during
the reporting period which are convertible into new ordinary shares
at the price of GBP0.50 per new ordinary share at any point during
the three-year term of the loan.
The loan notes attract interest at a rate of 12% per annum,
which is payable commencing on the date of issue either:
i) at the Company's option of 8% per annum paid monthly plus 4%
payable via the issue of additional Convertible Loan Notes as
payment in kind.
ii) 12% payable via the issue of additional Convertible Loan Notes as payment in kind.
The loan notes may be redeemed in cash at the option of company
at any point at a premium equal to 15% of the principal amount of
the Notes.
The equity element of the convertible loan note is recognised
within other reserves. Market interest rates of between 14% and 21%
has been applied to calculate the residual equity value of the
financial instrument.
8. Share capital
During the six months ended 30 June 2023 no new shares were
issued (six months to June 2022: 2,494,000 shares at a share price
of GBP1.00). Share capital in issue during the current and
comparative periods are listed below:
30 June 2023 31 December 30 June 2022
2022
Ordinary share No. GBP No. GBP No. GBP
capital
Issued and fully
paid
Ordinary 15,936,687 159,367 15,936,687 159,367 15,916,687 159,167
15,936,687 159,367 15,936,687 159,367 15,916,687 159,167
=========== ======== =========== ======== =========== ========
9. Share Option Reserve
30 June 31 December 30 June
2023 2022 2022
GBP GBP GBP
Share Option
reserve 2,570,666 2,396,396 1,671,767
2,570,666 2,396,396 1,671,767
========== ============ ==========
Silver Bullet Data Services Group PLC operates a programme for
employees of its subsidiaries to acquire shares in the company
under an EMI scheme.
The number and weighted average exercise price of share options
during the year were as follows:
30 June 2023 31 December 2022 30 June 2022
Weighted Share Weighted Share Weighted Share
average options average options average options
exercise exercise exercise
price price price
GBP No. GBP No. GBP No.
Outstanding at start
of period 1.49 1,569,620 1.56 1,679,607 1.56 1,679,607
Forfeited/expired
during period 0.05 (26,760) 1.50 (198,987) - -
Granted during period - - 0.27 109,000 - -
Exercised during
period - - 0.01 (20,000) - -
Outstanding at end
of period 1.52 1,542,860 1.49 1,569,620 1.56 1,679,607
---------- ---------- ---------- ----------
10. Related party transactions
Local Planet International Limited: is a related party to the
group by virtue of having Directors in common. Nigel Sharrocks, Ian
James and Martyn Rattle are directors of both companies.
Recharges for shared services totalling GBP49,384 (June 2022:
GBP23,070) are included in revenue for the six months ended 30 June
2023. Amounts outstanding at the period end included in trade
receivables totals GBP9,831 (June 2022: GBP29,178).
Recharges for direct costs incurred were processed during the
six months ended 30 June 2023 totalling GBP27,600 (June 2022:
GBP31,664). Amounts outstanding at the period end totalled GBP5,400
(June 2022: GBP35,395).
Marmalade Consultants Limited: is a related party to the group
by virtue of having Directors in common. Martyn Rattle is a
director of both companies. Consultancy services were provided
during the six months ended June 2023 totalling GBPnil (June 2022:
GBP25,627). All amounts outstanding were settled before the
reporting date 30 June 2023 (June 2022: GBPnil).
Umberto Torrielli: A director of the Group company relocated to
the USA in order to establish a new presence in this territory in
2020. For this purpose a loan was issued of GBP150,000 which is
held within other debtors at the end of the reporting period (June
2022: GBP150,000).
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END
IR SELFMWEDSEIU
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