TIDMONDO
RNS Number : 9996T
Ondo InsurTech PLC
28 July 2022
28th July 2022
Ondo InsurTech Plc
(formerly: Spinnaker Acquisitions Plc)
(" Ondo " or "the Company")
Posting of Notice of Annual General Meeting
Annual Report & Financial Statements for the Period Ended
28(th) February 2022
Ondo InsurTech Plc (LON: ONDO), the insurtech company which aims
to be the leading provider of claims prevention technology for home
insurers, is pleased to announce its Audited Results for the period
ended 28 February 2022 .
Ondo is also pleased to announce that Notice of its 2022 Annual
General Meeting ("AGM") and a Form of proxy will be posted to
shareholders on Friday 29(th) July and are available on the
Company's website http://www.ondoplc.com .
The AGM will be held at 11.30 a.m. on 22(nd) August 2022 at the
offices of Shakespeare Martineau LLP, 6(th) Floor, 60 Gracechurch
Street, London, EC3V 0HR.
Period Highlights
- Admission to Trading and first day of dealings on 14(th) July
2021 of Spinnaker Acquisitions Plc
- Announcement of proposed acquisition of HomeServe Labs Ltd on
13(th) December 2021 and subsequent Suspension of Listing
Post Period Highlights
-- Publication of an FCA approved prospectus setting out the
final details of the acquisition of LeakBot Ltd (formerly HomeServe
Labs Ltd)
-- Approval of the LeakBot Ltd acquisition by shareholders of
Spinnaker Acquisitions Plc, with subsequent admission of the
Enlarged Company to trading on the Standard List segment of London
Stock Exchange on 21(st) March 2022, wherein the Company raised
gross proceeds of GBP3.4 million through a fundraising
-- Incorporation of LeakBot USA Inc and appointment of Jim
Strickland as North America General Manager in April 2022
-- New rollout partner signing with Privatsikring in Denmark in May 2022
-- Expansion of LeakBot into the State of New York in May 2022
-- Publication of 3(rd) party research on 6(th) June 2022 which
demonstrates LeakBot can reduce escape of water claims spending by
70%
-- Announcement of new partnership with Admiral Group Plc, who
will roll out 20,000 LeakBot devices in the next 6 months from July
2022
Ondo CEO Craig Foster said:
"The annual report provides the results for the cash shell prior
to the closing of the LeakBot transaction. At the end of March 2022
we completed that transaction with the acquisition of LeakBot Ltd
and successfully raised GBP3.4m to support our growth plans.
Progress has been rapid since, with Admiral and Privatsikring
signed, expansion into New York State and publication of new 3(rd)
party research underlining the huge potential for our defensible
and repeatable business model. We look forward to further
demonstrating our progress and publishing our first consolidated
results with interims to the end of August 2022"
Enquiries
For further information, please visit www.ondoplc.com or contact the following:
Ondo InsurTech Plc Craig Foster, CEO +44 (0) 800 783 9866
SI Capital Ltd Nick Emerson +44 (0) 1483 413500
(Company Broker) Jon Levinson +44 (0) 20 3143 0600
Cassiopeia Services
Ltd
(PR & Investor Relations) Stefania Barbaglio +44 (0) 7949 690338
About Ondo InsurTech Plc
Ondo InsurTech Plc is on a mission to become the world's leading
provider of claims prevention technology for home insurers. Ondo's
focus is on the global scale-up of LeakBot - an end-to-end internet
of things solution which protects homes from the impact of water
damage. Water damage is the single biggest cause of home insurance
claims, accounting for $17bn of claims every year in the USA and UK
combined. LeakBot is a patented self-install solution that connects
to the home wireless network and, if it detects a leak, notifies
the customer via the LeakBot mobile app and provides access to a
team of expert LeakBot engineers to 'find and fix' the problem.
Recent independent research by Consumer Intelligence found LeakBot
can reduce the cost of water damage claims by 70%.
LeakBot partners with 11 insurance carriers - including Admiral,
Direct Line Group, Hiscox, Mapfre and TopDanmark - across 5
different countries, in Europe and the USA.
In March 2022 LeakBot became the first InsurTech to IPO in
London, as Ondo InsurTech Plc (LSE:ONDO).
Company Registration No. 13218816
Ondo InsurTech plc
(formerly known as
Spinnaker Acquisitions plc)
Annual Report and Financial
Statements
for the period ended
28 February 2022
Contents Page number
Company Information 2
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Chairman's statement 3
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Chief Executive Officer's Review 5
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Director profiles 7
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Strategic report 8
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Governance Report 12
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Remuneration Committee Report 16
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Directors' report 18
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Independent auditor's report to the members of Ondo
InsurTech Plc 23
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Income statement and statement of comprehensive income 29
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Statement of financial position 30
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Statement of changes in equity 31
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Statements of cash flows 32
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Notes to the financial statements 33
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COMPANY INFORMATION
Gregory Mark Wood
Directors Andrew Morrison
Stefania Barbaglio
Craig Foster
Ben Harber
Company Secretary
13218816 (England and Wales)
Company number
6(th) Floor
Registered office 60 Gracechurch Street
London
England
EC3V 0HR
Independent Auditor PKF Littlejohn LLP
Statutory Auditor
15 Westferry Circus
Canary Wharf
London
E14 4HD
Legal advisers
Hill Dickinson LLP
The Broadgate Tower
20 Primrose Street
London
EC2A 2EW
Corporate Adviser & Broker SI Capital Limited
19 Berkeley Street
London
W1J 8ED
Registrar Neville Registrars Limited
Neville House, Steelpark Road
Halesowen
West Midlands
United Kingdom
B62 8HD
CHAIRMAN'S STATEMENT
Welcome to the first annual report of Ondo InsurTech plc
("Company") which covers the Company's reporting period until 28
February 2022.
As of the date of this document, the legal and commercial name
of the issuer is Ondo InsurTech Plc.
The Company was incorporated under the Companies Act 2006 as a
private limited company and an indefinite life under the laws of
England and Wales on 23 February 2021 and the name Spinnaker
Acquisitions Limited. On 12 May 2021, the Company was re-registered
as a public limited company with the name Spinnaker Acquisitions
Plc. The Company was formed to undertake one or more acquisitions
of target companies, businesses, or assets.
The Shares were first admitted to the Official List by way of a
Standard Listing and to trading on the London Stock Exchange's main
market for listed securities on 28 July 2021. The Company raised
GBP65,003 prior to re-registration as a Plc and further gross
proceeds of GBP2,081,000 through an Initial Public Offering ("IPO")
fund-raising conducted amongst High Net Worth and Sophisticated
Investors to position the Company as a clean cash shell with a
material cash resource to inject into a new business by issuing
20,810,000 shares of GBP0.05 each at a price of GBP0.1 per ordinary
share.
On 6 September 2021, two new directors were appointed to the
Board. These two new directors subscribed for 520,000 ordinary
shares at a price of GBP0.125 raising GBP65,000.
On 10 December 2021, the Company entered into a sale and
purchase agreement with HomeServe Assistance Limited ("Seller"),
pursuant to which the Company conditionally agreed to acquire 100
per cent. of the issued share capital of LeakBot Limited ("LeakBot
Ltd"). The Company's shareholders gave their consent to the
acquisition and fundraise and confirmed authority for the
associated share issues at a general meeting held on 6 January
2022.
Following amendments to the sale and purchase agreement made on
28 January 2022, 15 February 2022 and 28 February 2022, the
aggregate consideration of GBP9,799,548 was finalised, split as
follows:
-- payment to the Seller of GBP1,599,548 in cash;
-- issue and allotment of 13,628,275 and 1,363,392 Consideration
Shares to the Seller and Gregory Mark Wood respectively at GBP0.12
per share, representing an aggregate amount of GBP1,799,000;
and
-- granting of secured loan notes of the Buyer with a redemption
value equal to GBP6,401,000.
Following the period end and in conjunction with the completion
of the acquisition of LeakBot Ltd, and readmission of its shares to
trading on 14 March 2022, the Company raised GBP3,427,500 through
the issue of 28,562,508 Shares at a price of 12 pence each and the
grant of 14,281,252 warrants to subscribe for Shares at an exercise
price of 25 pence each pursuant to a placing by SI Capital Ltd as
placing agent for the Company and a private subscription carried
out by the Company.
The Company recorded a loss on its P&L account of GBP580,260
during the financial year, including an amount of GBP161,793 in
respect of the Company's listing on the Standard Segment and
GBP200,000 of acquisition expenses incurred in advance of
completion of the acquisition of LeakBot Limited and readmission to
the Standard Segment.
The total commissions and other estimated fees and expenses in
connection with the acquisition of LeakBot Ltd and the associated
fundraise were approximately GBP592,000 plus VAT. Full details of
the acquisition and fundraise, together with a description of
LeakBot Ltd were set out in a prospectus which was published on 14
March 2022.
LeakBot Ltd is a B2B InsurTech business which developed and
patented the underlying technologies for a propriety leak detection
system. The leak detection system is called LeakBot. LeakBot Ltd's
primary business is the manufacture (through third-party
manufacturers) of the LeakBot device and supply (either directly or
through third-party distributors) of the LeakBot device and the
provision of underlying claims mitigation services to its insurer
partners. The LeakBot system enables household insurers to mitigate
the cost of claims arising due to an escape of water. This is
achieved through the installation of patented technology (the
LeakBot system) at insured households by end insured consumers and
the provision of claims mitigation services such as find-and-fix
plumbing repairs and data to assess risk. Insurers in the UK,
Denmark, Sweden, Ireland and the US pay for the LeakBot system and
derive the benefit of claims mitigation through the prevention of
leaks at insured households.
I am pleased to be able to note that following the period under
review, Ondo InsurTech Plc, and its subsidiary, LeakBot Ltd have
made an encouraging start to life as a public company. Our Chief
Executive Office Craig Foster expands on our strategy, our
achievements to date and the outlook for the Company in his
accompanying review.
It remains for me to thank Andy Morrison (former Chairman and
continuing Non-Executive Director), Stefania Barbaglio (continuing
Non-Executive Director) and the rest of the Spinnaker Acquisitions
team and our team of advisers for enabling the completion of the
transaction in macro-economic conditions that became very
challenging, especially after the end of February 2022.
Investment conditions remain challenging, but we are confident
that we have the product and management team to succeed. We are
focused on becoming cash-positive to be able to live within our
means as a Company in these uncertain times.
Together with my colleagues on the board and with our talented
management, I look forward to being able to report in future on the
execution of our strategy and the results obtained.
Gregory Mark Wood
Chairman
27(th) July 2022
CHIEF EXECUTIVE OFFICER'S REVIEW
Our mission at Ondo InsurTech Plc is to become the world leader
in claims prevention technology for home insurers. Thanks to the
reverse takeover of LeakBot Ltd, which was completed after the
financial year-end, we have taken a significant step towards
fulfilling this mission.
A world leader - solving a $17bn problem
I am confident that we can create a world-leading company in
claims prevention technology simply because we have the only
patented and proven solution to one of the most significant perils
in home insurance - claims caused by water damage.
In the US and UK, there are 1.6m claims a year caused by water
damage, costing insurers $17bn annually. With our flagship product
LeakBot we have a patented and proven solution to this significant
industry problem.
Fiscal year to February 2022
The accounting period to the end of February 2022 is prior to
the reverse take-over of LeakBot Ltd which took place in March 2022
and therefore does not contain consolidated results. However, I
would like to reflect on the progress LeakBot made in that same
period.
In those 12 months, LeakBot repeatedly executed the same
go-to-market model: where the device and the in-home repairs are
offered to homeowners for free by their insurer, with the insurer
paying LeakBot for these services in order to make a net saving on
claims spending.
We expanded this exact same proposition in the UK with rollouts
with Hiscox, Direct Line Select Premier, Eaton Gate and Covea. We
tested the same proposition in Denmark with TopDanmark and launched
a new pilot with LB Forsikring. Additionally, we tested this model
in Sweden with the largest P&C insurer in the country
Länsförsäkringar.
In the 12 months to the end February LeakBot reached 39,000
active devices on the platform, identified and resolved 13,820
leaks equivalent to an estimated saving of 400,000 litres of water
every day. With our own directly controlled plumbing engineers we
attended 1,371 customer homes to fix leaks and prevent claims.
Through the period we maintained a 4.8/5 Trust Pilot score from our
homeowners.
LeakBot was invented in the UK, patented first in the UK and is
now Made in Britain too as during 2021 we also moved our
manufacturing from China to Bedford in the UK, making a significant
cost saving in the process while reducing supply chain risks, and
attaining the Made In Britain mark.
Post Transaction Update
We were very pleased to conclude the reverse takeover
transaction in March 2022, creating Ondo Insurtech Plc - the first
InsurTech to be listed in the UK. I am delighted that pretty much
our entire team - demonstrating their faith in our business -
elected to stay in post as we moved from HomeServe to become part
of an independent company. We have moved quickly to further
strengthen the management team, bringing on board Jim Strickland as
General Manager for North America, giving us a huge advantage in
terms of North American P&C experience and contacts. In July we
also welcomed Dr. Chris Jelley PHD to the team as our new CTO,
whose experience is perfect to facilitate a period of rapid
growth.
In May we published a landmark study based on research by
Consumer Intelligence, who delved into the claims experience of our
customer base, which now spans 56,000 device years of data. That
study showed that in the UK where our model is the most mature, we
can reduce water damage claims costs by 70% - giving us brand new
statistics which underpin the value of the business model for our
insurance partners.
In the last 4 months the momentum of our business is
accelerating.
In July we announced a new landmark deal with Admiral. Admiral
is the very first mainstream UK insurer to adopt the LeakBot
system. Admiral are one of the biggest home insurers in the UK with
1.3 million customers and are the fastest growing home insurer with
11% growth in the last year. Admiral will rollout 20,000 LeakBots
in the next 6 months on their Platinum cover product, using the
results to scope out the opportunity for a larger scale roll-out
across the Admiral book.
In North America we are now concluding a pilot with Mapfre in
Massachusetts and expect to further expand in this state this year,
and we recently announced in April an expansion into the State of
New York.
In Scandinavia, we announced in May we have signed a new rollout
deal with Privatsikring following a successful
pilot in Denmark. Similarly, we have now concluded pilots with LB Forsikring in Denmark and Länsförsäkringar in Sweden. LB Forsikring have seen a 50% reduction in escape of water claims during the trial. Länsförsäkringar are the biggest home insurer in Sweden, and piloted LeakBot in 1 of their 23 regions where they already distributed LeakBot to 50% of the eligible customers and have seen both claims reduction and an increase in new customer acquisition, paving the way for expansion across the rest of the 23 regions in the Länsförsäkringar group.
Our immediate focus - more of the same
We are on a mission to become the world leader in claims
prevention technology for home insurers. Our immediate focus is to
do more of the same - sign more partnerships, install more units in
homes, driving continued year-on-year savings for carriers and
delivering year-on-year recurring returns for our shareholders.
We are eager to announce our first set of consolidated results
with a half year interim update to the end of August 2022, which we
aim to publish promptly after the period and are confident this
will demonstrate to all our shareholders that we are turning this
momentum into top-line growth.
Thank you to all the team who make it happen every day, to our
homeowners for doing their bit and to the insurers and investors
who have been early adopters and believers in our mission - we are
just getting started.
Craig Foster
Chief Executive Officer
27(th) July 2022
DIRECTORS' PROFILES
Gregory Mark Wood (Non-executive Chairman) (69)
Gregory Mark Wood is one of the UK's leading financial figures.
He has held several senior positions in global institutions,
including Head of Cash Management at Barclays Bank, Chief Executive
of Prudential UK and Europe, and CEO of AXA UK. In 2006, with
GBP500m of private equity backing, Gregory founded Paternoster,
which quickly became the market leader in bulk annuities. A regular
media commentator on pensions and insurance, Mark is a
Non-Executive Director of the RAC Motoring Services plc. He
received an Honorary Doctorate in Business Administration from
Anglia Ruskin University in 2010. In 2017, Mark was appointed
Commander of the Order of the British Empire in recognition of his
outstanding contribution to the British public sector.
Andrew Morrison (Non-executive Director) (62)
Mr Morrison is an established entrepreneur and investor
operating in junior public markets since 2007. In 2016, he founded
and brought Spinnaker Opportunities Plc to the London Stock
Exchange as a cash shell, in a transaction analogous to the
proposed listing of Spinnaker Acquisitions Plc. Mr Morrison led
Spinnaker Opportunities Plc into the reverse take-over of a
medicinal cannabis business to form Kanabo Group Plc. The
transaction completed in February 2021, achieving multiple returns
for fellow investors. Between 2007 and 2016, Mr Morrison learned
his trade as hired Chief Executive and/or Board adviser to mostly
natural resources companies including Xtract Energy Plc, Silvermere
Energy Plc, Zeta Petroleum Plc, Highlands Natural Resources Ltd
(now Zoetic International Plc) and Zenith Energy Ltd.
For the first 17 years of his career, Mr Morrison worked for
Shell in a variety of positions in oil products trading, shipping,
marketing and business development. Mr Morrison has a BSc (1st
Class) in Chemical Engineering and Fuel Technology from the
University of Sheffield, a Diploma in Company Direction from the
Institute of Directors and has published several articles in the
fields of innovation, venturing and strategic business
development.
Stefania Barbaglio (Non-executive Director) (37)
Stefania Barbaglio is a London-based entrepreneur, business
strategist, reputation specialist and well-recognised PR and
Investor Relations expert, who has advised a range of private and
listed companies across many sectors, focusing on innovation and
sustainability. She is the founder and CEO of the boutique Investor
& Public Relations agency Cassiopeia Services, and fashion
consultancy firm SteffyB. Stefania is highly experienced in Fintech
and new technologies. Stefania hosts a finance and crypto podcast
and is considered one of the top British female opinion leaders in
the crypto sphere. She is also a columnist for the UK online
financial journal City AM, a keynote speaker at international
events, and hosts regular symposia for public companies and
start-ups: investor presentations and networking evenings in
exclusive private venues. She is a fellow and alumna of Oxford
University and holds two MAs: International Journalism from
Westminster University (UK) and TV Production from IULM University
(Italy), as well as ten years' previous experience as a freelance
financial journalist and producer for mainstream TV channels
including Bloomberg, BBC & leading in-house Investor Relations
& PR departments.
Craig Foster (Founder and CEO) (43)
Craig Foster is an award-winning corporate entrepreneur and
business leader with over 20 years' experience leading businesses,
brands and teams both in the UK and globally. Craig spent 7 years
at Procter & Gamble in Brand Management in roles both in the UK
and Switzerland, before joining HBOS PLC to lead the marketing of
the group's UK General Insurance brands. At HomeServe Craig set-up
an innovation arm - HomeServe Labs - and it was within this team
that LeakBot was developed and launched. In 2017 Mr. Foster was
awarded the Insurance Times "Tech Champion of the Year" Award in
recognition of the breakthrough nature of LeakBot.
STRATEGIC REPORT
The Directors present their Strategic Report on Ondo Insurtech
plc for the period ended 28 February 2022.
Section 172(1) Statement - Promotion of the Company for the
benefit of members as a whole:
The Directors believe they have acted in the way they considered
in good faith, that would be most likely to promote the success of
the Company for the benefit of its members as a whole, as required
by s172 of the Companies Act 2006, and in doing so have had regard
to:
-- the likely consequences of any decision in the long term;
-- The need to act fairly between the members of the Company;
-- The desirability of maintaining the Company's reputation for
high standards of business conduct;
-- Consider the interests of the Company's employees;
-- The need to foster the Company's relationships with suppliers, customers and others; and
-- the impact of the Company's operations on the community and the environment.
The Board recognise that their primary role is the
representation and promotion of shareholders' interests. The Board
makes every effort to understand the interests and expectations of
the shareholders and other stakeholders, and to reflect these in
the choices it makes in its effort to create long-term sustainable
value. Governed by the Companies Act 2006, the Company has adopted
the Quoted Companies Alliance Corporate Governance Code 2018 (the
"QCA Code"). The Board recognises the importance of maintaining a
good level of corporate governance which, together with the
requirements of a main market listing, ensures that the interest of
the company's stakeholders are safeguarded.
As a Company, the Board seriously considers its ethical
responsibilities to the communities and environment.
In order to fulfil their duties under section 172 and promote
the success of the Company for the benefit of all its stakeholders,
the directors need to ensure that they not only act in accordance
with the legal duties but also engage with, and have regard for,
all its stakeholders when taking decisions. The Company has a
number of key stakeholders that it is committed to maintaining a
strong relationship with. Understanding the Company's stakeholders
and how they and their interests will impact on the strategy and
success of the Company over the long term is a key factor in the
decisions that the Board make.
Shareholders The promotion of the success of the Company is
ultimately for the benefit of the Company's shareholders who
provide the Company's permanent capital. As a company listed on the
London Stock Exchange, the Company is responsible for ensuring that
it is aware of shareholder needs and expectations. The Directors
attach great importance to maintaining good relationships with all
of its shareholders and interested parties and seeks to ensure that
they have access to correct and adequate information in a timely
fashion. The Directors are aware that as stakeholders, its
shareholders play a vital role in the fabric of the Company and
therefore regularly engages in dialogue with the Company's
shareholders and is available for meetings with institutional and
major shareholders following the release of the Company's Annual
and Interim Results. The Directors welcome all shareholders to make
contact with the Company and provide any feedback or comments that
they may have, and contact details are available on the Company's
website. The Company's Annual General Meeting is also an important
opportunity for shareholders to meet and engage with Directors and
ask questions on the Company and its performance.
Regulatory Bodies As the Company is listed on the Standard
Segment of the Main Market of the London Stock Exchange it
therefore actively engages with various regulatory bodies and
advisory firms to ensure that compliance standards are maintained
and that the Company continues to act with the high standards of
business conduct that have established its reputation thus far.
Suppliers and Advisors The Company's suppliers and advisors are
integral to the day to day operation of the Company. Relationships
with suppliers and advisors are carefully managed to ensure that
the Company is always obtaining value for money. The Company seeks
to ensure that good relationships are maintained with its suppliers
and advisors through regular contact and the prompt payment of
invoices.
Other stakeholders and the wider community The Directors are
committed to ensuring that none of its activities have a
detrimental impact on the wider community and the environment.
Review of Business in the Period
Operational Review
The Company's principal activity is set out in the Director's
Report on page 18.
The Company was incorporated on 23 February 2021 as a private
limited company under the name of Spinnaker Acquisitions Limited.
On 12 May 2021, the company re-registered as a public limited
company. On 22 March 2022, the company was renamed Ondo InsurTech
Plc.
On 14 July 2021, the Company published the Prospectus in
relation to its Placing and Subscription and Admission of the share
capital to the Official List (by way of a Standard Listing) and to
trading on the London Stock Exchange's main market. The Company
raised gross proceeds of GBP2,081,000 from the issue and allotment
of shares at that time and began its search for an acquisition.
At that stage the Company had no operating history. Its
objective was to acquire one or more target companies or businesses
in the sustainability and/or energy transition sectors. During the
period from July 2021 to December 2021, the Directors were focused
on identifying a suitable target.
On 13 December 2021, the Company announced that it had
conditionally agreed to acquire the entire issued share capital of
HomeServe Labs Ltd ("Labs"), a wholly owned subsidiary of FTSE250
quoted public company HomeServe Plc, by way of a reverse takeover.
The principal activity of Labs is the development and
commercialisation of a water security system for the detection of
micro-leaks in residential properties.
Events after the reporting date
The acquisition of Labs was completed on 21 March 2022 with the
Company changing its name to Ondo InsurTech and the subsidiary was
renamed LeakBot Limited.
At the same time as completing the acquisition, the Company has
raised gross proceeds of GBP3,427,500 through the Placing and
Subscription and by granting the warrants, and net proceeds of
approximately GBP3,155,500.
Further details of the acquisition and the strategy of the
business following the acquisition are provided in the Chief
Executive Officer's Review.
On 22 March 2022, a subsidiary called LeakBot USA Inc. was
incorporated in the state of Delaware. This company was
incorporated to engage directly with US-based insurance
companies.
Environmental and Social
The Company is committed to creating long-term value and sharing
the benefits of its operations with all its stakeholders, including
employees and shareholders. Following the acquisition of Labs, the
Company's operations have the potential to provide a significant
positive impact on the socio-economic development of its local
communities, while minimising their impact on the environment.
Environment, social and governance ("ESG") policies, systems and
practices are embedded throughout the business.
The Company is aware that it needs to measure the operational
carbon footprint in order to limit and control its environmental
impact. However, since the Company, due to its limited activities
in the period under review, did not consume more than 40,000kWh of
energy, the Company's emissions are not disclosed for this
reason.
Financial review
Results for the period
The Company incurred a loss for the period from incorporation to
28 February 2022 of GBP580,260.
The net cash increase was GBP1,679,207 and at 28 February 2022,
the Company held GBP1,679,207 of cash and cash equivalents.
As the Company did not trade in the period, its key performance
indicators were the losses incurred and the cash figures stated
above.
Position of the Company's business
At the period end, the Company's Statement of Financial Position
shows net assets totalling GBP1,670,450 which included GBP1,679,207
of cash and cash equivalents.
Environmental matters
The Board contains personnel with a good history of running
businesses that have been compliant with all relevant laws and
regulations and there have been no instances of non-compliance in
respect of environmental matters.
Employee information
At present, there are three male directors and one female
director. The Company has one executive and three non-executive
directors. The Company is committed to gender equality and
diversity and, if future roles are identified, a wide-ranging
search would be completed with the most appropriate individual
being appointed irrespective of race or gender.
The Company ensures that employment practices take into account
the necessary diversity requirements and compliance with all
employment laws. The Board has experience in dealing with such
issues and have sufficient training and qualifications to ensure
they meet all the requirements.
Anti-corruption and anti-bribery policy
The government of the United Kingdom has issued guidelines
setting out appropriate procedures for companies to follow to
ensure that they are compliant with the UK Bribery Act 2010. The
Company has conducted a review into its operational procedures to
consider the impact of the Bribery Act 2010 and the Board has
adopted an anti-corruption and anti-bribery policy.
Assessment of business risk
The Board regularly reviews operating and strategic risks. The
Company's operating procedures include a system for reporting
financial and non-financial information to the Board including:
-- reports from management with a review of the business at each
Board meeting, focusing on any new decisions/risks arising; and
-- consideration of reports prepared by third parties.
Principal Risks and Uncertainties
Reliance on key personnel
If any of the senior management team were to leave the Company
the number of appropriately qualified and available replacements
would be limited. This situation would be exacerbated due to the
high demand for such individuals and so the Company would be likely
to incur significant costs to retain key staff or attract
replacements should they leave. The loss of the services of any key
personnel, or an inability to attract other suitably qualified
persons when needed, could prevent the Company from executing its
business plan and strategy and it may be unable to find adequate
replacements on a timely basis, or at all. While all key personnel
will hold equity in the business of a value sufficient to reflect
their importance to the business, departure of key personnel would
potentially render more difficult the delivery of the current
business plan.
Future financial capital requirements
Following completion of the acquisition after the period end,
the speed at which the Group can achieve break-even and then
profitability will be dependent on whether it expands its customer
and distributor base and achieves targeted market acceptance of its
products. Therefore, it is possible that, in the future, the
Company may need to raise additional funds through equity or debt
financings; sale of assets; collaborative arrangements with
commercial partners or from other sources. Any additional equity
financing may dilute an investor's holdings in the Company. Any
future debt financing, if available, may require restrictions to be
placed on the Company's future financing and operating activities.
The Company may be unable to obtain additional financing on
acceptable terms if market and economic conditions, the financial
condition or operating performance of the Group, or investor
sentiment, are unfavourable. If the Company is unable to raise
further funds, its ability to grow its business in the future may
be hindered and the Directors may be required to review or change
the business strategies of the Group.
Capital Structure
The Company's capital consists of ordinary shares which rank
pari passu in all respects and which are traded on the Standard
segment of the Main Market of the London Stock Exchange. There are
no restrictions on the transfer of securities in the Company or
restrictions on voting rights and none of the Company's shares are
owned or controlled by employee share schemes. There are no
arrangements in place between shareholders that are known to the
Company that may restrict voting rights, restrict the transfer of
securities, result in the appointment or replacement of Directors,
including in relation to the issuing or buying back by the Company
of its shares or any significant agreements to which the Company is
a party that take after or terminate upon, a change of control of
the Company following a takeover bid or arrangements between the
Company and its directors or employees providing for compensation
for loss of office or employment (whether through resignation,
purported redundancy or otherwise) that may occur because of a
takeover bid.
Approved by the Board and signed on its behalf by:
Craig Foster
Director
27(th) July 2022
GOVERNANCE REPORT
The QCA Corporate Governance Code
The Directors recognise the importance of and are committed to,
sound corporate governance principles being embedded into the
operations of the Company. The Company is not formally required to
comply with a corporate governance code; however, the Company has
voluntarily applied the Quoted Company Alliance (QCA) Corporate
Governance Code published in April 2018 (the QCA Code). As meeting
the QCA Code is not required, the Company did not fully comply with
any corporate governance code during the year, however, post
year-end, following the acquisition, it has adopted the QCA Code
and will seek to meet its ten principles.
The principles of the Quoted Company Alliance (QCA) Code:
Principle 1: Establish a strategy and business model which
promotes long-term value for shareholders
The Company's overarching strategic objective is to deliver
long-term value to shareholders. Since the period end, the Company
has completed the acquisition of LeakBot Limited.
The Directors expect their strategy will drive shareholder value
through delivering organic growth, delivering growth through
acquisition, delivering operating profitability to shareholders and
delivering operational efficiencies.
Principle 2: Seek to understand and meet shareholder needs and
expectations
The Board intends to maintain high levels of communication and
have constructive dialogue with its shareholders on a regular
basis. The Company understands the need for effective communication
and constructive dialogue with investors and financial media and
will provide communications through its Annual and Interim Reports,
along with Regulatory News Service announcements. The Board is
putting in place a general policy of keeping all interested parties
informed by regular announcements and update statements. The CEO
will be the Company's principal spokesperson with investors, fund
managers, the press and other interested parties and act as a
general liaison for all shareholders.
All Directors will attend annual general meetings of the Company
("AGM"s), where private investors are given the opportunity to
speak to and question the Board. The AGM will provide an
opportunity to meet, listen and present to shareholders, and all
shareholders are encouraged to attend.
The Directors intend to continue dialogue with shareholders at
other formal meetings which provide an opportunity to meet, listen
and present to shareholders, such as at Capital Markets Days. The
Company is open to receiving feedback from all stakeholders and
will take action where appropriate. The Company is contactable by
email and relevant shareholder queries are passed to the Board for
discussion. Investor Relations information on the Company's website
will be kept updated on relevant developments, financial reports
and results presentations.
Principle 3: Take into account wider stakeholder and social
responsibilities and their implications for long-term success
The Directors believe that the main stakeholders of the Company
are its clients, its employees, the communities it works with and
its shareholders. The Directors are mindful of its corporate social
responsibilities and the need to build and maintain strong
relationships across its range of stakeholder groups.
The Directors are committed to providing its customers and
clients the highest levels of service and to seeking their regular
feedback to ensure any concerns are understood and addressed.
The Board believes good two-way communication with staff is a
key requirement for high levels of engagement, fostering a culture
of innovation. The Company consciously fosters a work environment
where employees are - and consider themselves to be - key
stakeholders in the business.
With regard to shareholders, the Company seeks to meet its
responsibilities through meeting regulatory requirements and by
understanding shareholder sentiments on the business, its prospects
and performance of management. The Directors are available to
discuss any matter stakeholders might wish to raise.
Principle 4: Embed effective risk management, considering both
opportunities and threats, throughout the organisation
The Board takes responsibility for the establishment and
oversight of the Group's risk management framework and has
established an Audit & Risk Committee to ensure the Group's
risk management systems, policies and procedures are appropriate to
identify and analyse the risks faced by the Company, to set
appropriate risk limits and controls, and to monitor ongoing risks.
The Committee will maintain effective working relationships with
the Board of Directors, management, and the external auditors and
monitor the independence and effectiveness of the auditors and the
audit.
The Board's oversight covers all financial and operational
controls. The Board's primary method of monitoring is through
reviewing reports from management to consider whether significant
risks are identified, evaluated and controlled and whether any
significant weaknesses are resolved.
An internal audit function is not yet considered necessary or
practical due to the size of the Company and day to day control is
sufficiently exercised by the Executive Directors. However, the
Board will continue to monitor the need for an internal audit
function.
Principle 5: Maintain the Board as a well--functioning, balanced
team led by the Co-Chairs
The Board comprises of Craig Foster as CEO with three
non-executive directors; Gregory Mark Wood, Andy Morrison and
Stefania Barbaglio.
The Board is charged with responsibility for the stewardship of
the Company and for ensuring that corporate governance arrangements
are appropriate for the nature and complexity of the Company's
operations. The Board is responsible for taking all major strategic
decisions and also addressing any significant operational matters.
In addition, the Board reviews the risk profile along with the
Audit and Risk Committee and ensures that an adequate system of
internal control is in place.
The Independent Non-Executive Directors are considered by the
Board to be independent of management and free from any business or
other relationship that could materially interfere with the
exercise of their independent judgement in accordance with the QCA
Code. The Board deem this appropriate due to the balance of skills
and experience held by each individual director, in the context of
the current size of the Group and its growth potential.
The Chief Executive is responsible for the leadership and
day-to-day management of the Company and its Group. This includes
formulating and recommending the strategy for Board approval and
executing the approved strategy.
The Board meets monthly, and more frequently if necessary.
The Audit and Risk Committee will meet at least two times a year
and the Remuneration Committee at least three times a year. The
terms of reference setting out the responsibilities of the Audit
& Risk Committee and Remuneration Committee are summarised on
the Group's website.
Principle 6: Ensure that between them the Directors have the
necessary up-to-date experience, skills and capabilities
The Board considers its current composition and overall size to
be both appropriate and suitable with the correct blend of sector,
financial and public markets experience and personal skills and
capabilities to enable it to deliver its strategy and provide
appropriate critique.
The composition of the Board is reviewed on an annual basis by
the Nomination Committee. The Nomination Committee is fully
committed to the appointment of the right skills that are required
to grow shareholder value.
The Board will undertake a thorough evaluation of the skills,
knowledge and experiences of a proposed new Director before making
the final decision on the appointment of a new member. Throughout
the year, the Directors will receive updates on corporate
governance matters.
Principle 7: Evaluate Board performance based on clear and
relevant objectives, seeking continuous improvement
The Board itself is responsible for board evaluation. An
internal Board evaluation will take place annually going forward
and will be conducted by way of a questionnaire and interviews. In
addition, the Non-executive Directors will meet, without the
executive directors present, and will evaluate performance of the
executives. The results shall be used by the Board for its approach
to succession planning.
Principle 8: Promote a corporate culture that is based on
ethical values and behaviours
The Board promotes a healthy corporate culture and has
considered how that culture is consistent with the Company's
objectives, strategy and business model. The Board believes the
culture to be inclusive, transparent and collaborative with
appropriate behaviours. The Board is satisfied that the Company has
a 'speak up' culture and the Directors regularly observe this
occurring in practice.
The Group has a Code of Conduct, a Share Dealing Code, an
Anti-Bribery Policy, Publicity Guidelines, Related Party
Transaction guidelines, a Disclosure policy stating the Company's
commitment to conducting its business with honesty and integrity,
its expectation that staff will maintain high standards, and
encouraging prompt disclosure of any suspected wrongdoing. All such
policies have been shared with employees are available to view on
internal systems.
In addition, in line with the Market Abuse Regulations ("MAR"),
the Company has adopted a Share Dealing Policy and Dealing Code
which apply to all Directors and employees of the Company.
Principle 9: Maintain governance structures and processes that
are fit for purpose and support good decision-making by the
Board
The Board is committed to a high standard of corporate
governance across the Company, recognising that it is important in
protecting Shareholders' interests and the long-term success of the
Company. The QCA Code is being implemented on a "comply or explain"
basis, whereby there is an acceptance that non-compliance is not
wrong, provided there is a well-justified explanation which
properly describes why such noncompliance is appropriate for the
Company and is in the best interests of its Shareholders.
Progress, and how it is intended to be made, in terms of
governance structures against the Company's objectives, strategy
and business model, will be detailed in the Company's next annual
report and shall also be included on the Company's website.
Principle 10: Communicate how the Company is governed and is
performing by maintaining a dialogue with shareholders and other
relevant stakeholders
The Directors are committed to open communication with all its
shareholders. Communications with shareholders will be
predominantly through the Annual Report and AGM. Other
communications are in the form of, full-year and half-year
announcements, periodic market announcements (as appropriate),
one-to-one meetings and investor roadshows with institutional
investors.
The Company's website is regularly updated and users can
register to be alerted via email when announcements or details of
presentations and events are posted on the website.
Committees
As envisaged by the QCA Corporate Governance Code, the Board has
established an Audit and Risk Committee, a Nomination Committee and
a Remuneration Committee.
If the need should arise, the Board may set up additional
committees as appropriate.
Audit and Risk Committee
The Audit and Risk committee, which comprises of Andy Morrison
(Chair) and Stefania Barbaglio, has the primary responsibility for
monitoring the quality of internal control and ensuring that the
financial performance of the Company is properly measured and
reported on and for reviewing reports from the Company's auditors
relating to the Company's accounting and internal controls.
The committee is also responsible for making recommendations to
the Board on the appointment of auditors and the audit fee and for
ensuring that the financial performance of the Company is properly
monitored and reported.
The Audit and Risk Committee will meet not less than three times
a year.
Remuneration Committee
The remuneration committee, which comprises of Andy Morrison
(Chair) and Stefania Barbaglio, is responsible for the review and
recommendation of the scale and structure of remuneration for
senior management, including any bonus arrangements or the award of
share options with due regard to the interests of the Shareholders
and the performance of the Company.
Due to the limited operations on the Company during the period
ended 28 February 2022, the Remuneration Committee has not prepared
a Report but details on Directors' remuneration and their interest
in the share capital of the Company are provided in the Directors'
Report.
Nomination Committee
The nomination committee, which comprises Stefania Barbaglio
(Chair), Gregory Mark Wood and Craig Foster, is responsible for
matters of nomination and succession of board directors and senior
management.
Approved by the Board and signed on its behalf by:
Gregory Mark Wood
Chairman
27(th) July 2022
REMUNERATION COMMITTEE REPORT
On behalf of the board, I am pleased to present the Remuneration
Committee Report for the period ended 28 February 2022.
External Advice
The Remuneration Committee did not receive any external advice
in the period in meeting its responsibilities.
Directors Remuneration Policy
The Remuneration Committee takes into account both Group and
individual performance, market value and sector conditions in
determining director and senior employee remuneration. Since the
acquisition of LeakBot Limited, the Group has maintained a policy
of paying salaries comparable with peer companies in the sector in
order to attract and retain key personnel.
The remuneration policy of the Company prior to the transaction
was not to pay fees to directors or retained advisers and instead
to pay a success fee in shares upon completion of a transaction.
This was done in the post period. The revised remuneration policy
of the Group is being worked on by the Remuneration Committee. The
expected completion date for the revised remuneration policy is
December 2022.
Annual Report on Remuneration
Responsibilities of the Remuneration Committee
The key responsibilities of the Remuneration Committee are to
determine on behalf of the Board:
-- the Company's general policy on Executive remuneration;
and
-- the specific remuneration packages of the Executive
Directors, the Chair of the Board and senior
Executives of the Group including, but not limited to, base
salary, pension, annual performance-related bonuses and Performance
Share Plan ("PSP") awards.
The fees of the Non-Executive Directors are determined by the
Chair and the Executive Directors. All Directors are subject to the
overriding principle that no person shall be involved in the
process of determining his or her own remuneration.
The full responsibilities of the Committee are contained within
its Terms of Reference, which are available on our website.
Audited information
The audited tables and related notes are identified within this
report
Single Figure of Total Remuneration
The total amount paid by the Company to each of the Directors,
in respect of the financial period ended 28 February 2022 is set
out in the table below.
Period ended 28 February 2022
PSP awards are the calculated values of the Share Options
awarded to directors in compensation for their work and do not
represent cash payments.
The Committee is grateful for the continuing support of
shareholders. To ensure that this continues, the Committee will
consult with shareholders on major issues where it is appropriate
to do so. It will also continue to adhere to its underlying
principle of decision-making that Executive Directors' pay must be
linked to performance and the sustainable delivery of value to our
shareholders.
This Annual Report on Remuneration has been approved by the
Board of Directors and signed on its behalf by:
Andrew Morrison
Chair of the Remuneration Committee
27(th) July 2022
DIRECTORS' REPORT
The Directors present their report together with the audited
financial statements for the period ended 28 February 2022.
Principal Activity
The principal activity of the Company during the period ended 28
February 2022 was that of an investment company quoted on the
Standard Segment of the Main Market of the London Stock
Exchange.
Directors
The present members of the Board of Directors together with
brief biographies are shown on page 7.
The following directors were appointed during the period and
after the period end:
Gregory Mark Wood - Appointed 21 March 2022
Andrew Morrison - Appointed 23 February 2021
Stefania Barbaglio - Appointed 6 September 2021
Craig Foster - Appointed 21 March 2022
Anthony Harpur - Resigned on 21 March 2022
Alan Hume - Resigned on 21 March 2022
Claudia Stijlen - Resigned on 21 March 2022
Directors' interests
The interests of the Directors who served at the end of the
period in the share capital of the Company at 28 February 2022:
Name Number of shares Holding %
Andrew Morrison 2,150,020 9.50
Anthony Harpur 2,150,020 9.50
Alan Hume 1,150,020 5.08
Stefania Barbaglio 370,000 1.63
Claudia Stijlen 400,000 1.63
Directors' interests in share options and warrants
At 28 February 2022, the Directors' interests in share options
were:
Name Number of options
Andrew Morrison 820,151
Anthony Harpur 488,500
Alan Hume 276,895
Stefania Barbaglio 175,983
Claudia Stijlen -
Remuneration
Directors' remuneration for the period ended 28 February
2022:
Name Share Total
based payments remuneration
2022 2022
GBP GBP
Andrew Morrison 35,856 35,856
Anthony Harpur 21,357 21,357
Alan Hume 12,106 12,106
Stefania Barbaglio 7,694 7,694
Claudia Stijlen -
77,013 77,013
There were no pension entitlements and no fees were payable to
the directors prior to the completion of an acquisition, which
occurred after the year end.
Political donations
The Company did not make any political donations or expenditure
in the period.
Substantial shareholders
As at 25 July 2022, the parties who are directly or indirectly
interested in 3 percent or more of the nominal value of the
Company's share capital are as follows:
Number of Ordinary %
Shares
Homeserve Assistance Limited 13,628,275 19.99
Premier Miton Investors 4,166,666 6.11
Anthony Harpur 3,055,187 4.48
Andy Morrison 2,970,171 4.36
Financial instruments
Details of the use of the Company's financial risk management
objectives and policies as well as exposure to financial risk are
contained in the accounting policies and note 14 of the financial
statements.
Dividends
The Directors do not propose a dividend in respect of the period
ended 28 February 2022.
Future developments and events subsequent to the period end
Further details of the Company's developments and events
subsequent to the period end are set out in the Strategic Report on
page 8 and in note 17 to the financial statements.
Viability and going concern statement
In accordance with the UK Corporate Governance Code 2018 (the
'Code'), the Directors have assessed going concerns over a
twelve-month period from the approval of these financial statements
i.e. up to 31 July 2023 and have assessed the viability of the
Group. The assessment period for viability is aligned with the
strategic outlook timeframe. As part of this assessment, the
Directors have analysed the prospects of the Group by reference to
its current financial position, recent trading trends and momentum,
forecasts and financial projections, strategy, economic model and
the principal risks and mitigating factors.
Group planning process
Our annual planning process begins in September with a detailed
review of the key strategic goals by the Board of Directors and the
Executive Team, following which an updated long-term financial plan
is derived. A detailed, bottom-up budget for the year ahead is then
prepared, which is signed off by the Board in November. We monitor
our performance throughout the financial year against this budget
with a regular formal re-forecasting process conducted on a monthly
basis.
Base case
The strategic plan forms the base case for the scenario
modelling that underpins the viability assessment and going concern
assessment. It has been built out from the Board-approved budget
which includes the funds raised of GBP3,427,500 in March 2022.
Principal assumptions include: continued activity with existing
insurance partners, and new activity with pipeline partners;
pricing assumptions based on signed contracts or active
negotiations; direct cost assumptions based on current run-rates;
assumptions about fixed overhead and operational costs being
largely stable through the period; some limited capital expenditure
in technology and manufacturing.
Viability assessment
The Directors have reviewed the Group's forecasts and
projections for a period of twelve months from the approval of
these financial statements i.e. up to 31 July 2023 (the 'Assessment
Period'), which is aligned to the Group's current strategic
planning cycle. The Directors have assessed the future viability of
the Group by reviewing the Base Case and risk scenarios based on
the Principal Risks. These circumstances have been evaluated based
on principal and emerging risks identified by management through
its risk management process, with consideration given to broader
socioeconomic factors.
Conclusion
The Directors are of the opinion that the Company has adequate
working capital to meet its obligations for a period of twelve
months from the approval of these financial statements i.e. up to
to 31 July 2023. The Directors have therefore made an informed
judgement, at the time of approving the financial statements, that
there is reasonable expectation that the Company has adequate
resources to continue its operational existence for the foreseeable
future.
Auditors
The Board appointed PKF Littlejohn LLP as auditors of the
Company on 21 June 2022.
PKF Littlejohn LLP have expressed their willingness to accept in
office and a resolution to reappoint them will be proposed at the
Annual General Meeting in accordance with Section 489 of the
Companies Act 2006.
Website publication
The Directors are responsible for ensuring the Annual Report and
the financial statements are made available on a website. Financial
statements are published on the Company's website in accordance
with legislation in the UK governing the preparation and
dissemination of financial statements, which may vary from
legislation in other jurisdictions. The maintenance and integrity
of the Company's website is the responsibility of the Directors.
The Directors' responsibility also extends to the ongoing integrity
of the financial statements contained therein.
Statement of Directors' Responsibilities in respect of the
financial statements
The Directors are responsible for preparing the Annual Report of
the Directors and the financial statements in accordance with
applicable law and regulations.
Company law requires the Directors to prepare financial
statements for each financial year. Under that law the Directors
have elected to prepare the Company financial statements in
accordance with UK adopted international accounting standards.
Under Company law the directors must not approve the financial
statements unless they are satisfied that they give a true and fair
view of the state of affairs of the Company and of the profit or
loss of the Company for that period. The Directors are also
required to prepare financial statements in accordance with the
rules of the London Stock Exchange for companies with a standard
listing.
In preparing these financial statements, the directors are
required to:
-- select suitable accounting policies and then apply them consistently;
-- make judgments and accounting estimates that are reasonable and prudent;
-- state whether applicable international accounting standards
have been followed, subject to any material departures disclosed
and explained in the financial statements; and
-- prepare the financial statements on the going concern basis
unless it is inappropriate to presume that the Company will
continue in business.
The Directors are responsible for keeping adequate accounting
records that are sufficient to show and explain the Company's
transactions and disclose with reasonable accuracy at any time the
financial position of the Company and enable them to ensure that
the financial statements comply with the Companies Act 2006. They
are also responsible for safeguarding the assets of the Company and
hence for taking reasonable steps for the prevention and detection
of fraud and other irregularities.
The Directors are responsible for the maintenance and integrity
of the corporate and financial information included on the
Company's website. Legislation in the United Kingdom governing the
preparation and dissemination of financial statements may differ
from legislation in other jurisdictions.
Statement of Directors' responsibilities pursuant to disclosure
and transparency rule
Each of the Directors, whose names and functions are listed on
page 7 confirm that, to the best of their knowledge and belief:
-- the financial statements prepared in accordance with UK
adopted international accounting standards give a true and fair
view of the assets, liabilities, financial position, and loss of
the Company; and
-- the Annual Report and financial statement include a fair
review of the development and performance of the business and the
position of the Company, together with a description of the
principal risks and uncertainties that they face.
Disclosure of information to auditor
In the case of each person who was a Director at the time this
report was approved:
-- so far as that director is aware there is no relevant audit
information of which the Company's auditor is unaware; and
-- that each director has taken all steps that the director
ought to have taken as a director to make themselves aware of any
relevant audit information and to establish that the Company's
auditor is aware of that information.
Approved by the Board and signed on its behalf by:
Gregory Mark Wood
Chairman
27(th) July 2022
INDEPENT AUDITOR'S REPORT TO THE MEMBERS OF ONDO INSURTECH
PLC
Opinion
We have audited the financial statements of Ondo InsurTech PLC
(the 'company') for the period ended 28 February 2022 which
comprise: the Income Statement and Statement of Comprehensive
Income, the Statement of Financial Position, the Statement of
Changes in Equity, the Statement of Cash Flows and notes to the
financial statements, including significant accounting policies.
The financial reporting framework that has been applied in their
preparation is applicable law and UK-adopted international
accounting standards.
In our opinion, the financial statements:
-- give a true and fair view of the state of the company's
affairs as at 28 February 2022 and of its loss for the period then
ended;
-- have been properly prepared in accordance with UK-adopted
international accounting standards; and
-- have been prepared in accordance with the requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International
Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our
responsibilities under those standards are further described in the
Auditor's responsibilities for the audit of the financial
statements section of our report. We are independent of the company
in accordance with the ethical requirements that are relevant to
our audit of the financial statements in the UK, including the
FRC's Ethical Standard as applied to listed public interest
entities, and we have fulfilled our other ethical responsibilities
in accordance with these requirements. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide
a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the
director's use of the going concern basis of accounting in the
preparation of the financial statements is appropriate. Our
evaluation of the directors' assessment of the company's ability to
continue to adopt the going concern basis of accounting
included
-- Reviewing the cash flow forecasts prepared by management for
the period up to 31 July 2023 corroborating, providing challenge to
key assumptions and reviewing for reasonableness;
-- A comparison of actual results for the period to forecasts to
assess the forecasting ability/accuracy of management;
-- Reviewing post-year end RNS announcements; and
-- Assessing the adequacy of going concern disclosures within
the Annual Report and Financial Statements.
Based on the work we have performed, we have not identified any
material uncertainties relating to events or conditions that,
individually or collectively, may cast significant doubt on the
company's ability to continue as a going concern for a period of at
least twelve months from when the financial statements are
authorised for issue.
Our responsibilities and the responsibilities of the directors
with respect to going concern are described in the relevant
sections of this report.
Our application of materiality
The scope of our audit was influenced by our application of
materiality. The quantitative and qualitative thresholds for
materiality determine the scope of our audit and the nature, timing
and extent of our audit procedures. The materiality for the
financial statements as a whole applied to the financial statements
of the Company was GBP14,000 based on 1% of gross assets. We
consider gross assets to be the most relevant performance indicator
for a Company seeking to undertake an acquisition.
Performance materiality was set at 60% of the respective
financial statement materiality levels. We use performance
materiality in determining the scope of our audit and the nature
and extent of our testing of account balances, classes of
transactions and disclosures, for example in determining sample
sizes.
We agreed with the board that we would report all audit
differences identified during the course of our audit in excess of
GBP700. There were misstatements identified during the course of
our audit that were considered to be material and adjusted for by
management.
Our approach to the audit
In designing our audit, we determined materiality and assessed
the risks of material misstatement in the financial statements. In
particular we addressed the risk of management override of internal
controls, including evaluation whether there was evidence of bias
by the directors that represented a risk of material misstatement
due to fraud.
Key audit matters
Key audit matters are those matters that, in our professional
judgment, were of most significance in our audit of the financial
statements of the current period and include the most significant
assessed risks of material misstatement (whether or not due to
fraud) we identified, including those which had the greatest effect
on: the overall audit strategy, the allocation of resources in the
audit; and directing the efforts of the engagement team. These
matters were addressed in the context of our audit of the financial
statements as a whole, and in forming our opinion thereon, and we
do not provide a separate opinion on these matters.
Key Audit Matter How our scope addressed this
matter
Management override
===============================================================
Under ISA (UK) 240 "The Auditor's Our work in this area will included
responsibility to consider fraud but not limited to:
in an audit of financial statements",
there is a presumed significant * A review of journals processed during the period
risk of management override under review and in the preparation of the financial
of the system of internal controls. statements to determine whether these were
appropriate.
Due to low volume of transactions
during the period and direct
involvement of management in * A review of key estimates, judgements and assumptions
the operations, there is a potential within the financial statements for evidence of
risk of manipulation of financial management bias, and agree to appropriate supporting
results. documentation. In this context we view the key
estimates as being fair value of share options and
warrants.
* An assessment of whether the financial results and
accounting records include any significant or unusual
transactions where the economic substance is not
clear.
We did not identify any indicators
of fraud or management override
of controls from our testing.
===============================================================
Other information
The other information comprises the information included in the
annual report, other than the financial statements and our
auditor's report thereon. The directors are responsible for the
other information contained within the annual report(7) . Our
opinion on the financial statements does not cover the other
information and, except to the extent otherwise explicitly stated
in our report, we do not express any form of assurance conclusion
thereon. Our responsibility is to read the other information and,
in doing so, consider whether the other information is materially
inconsistent with the financial statements or our knowledge
obtained in the course of the audit, or otherwise appears to be
materially misstated. If we identify such material inconsistencies
or apparent material misstatements, we are required to determine
whether this gives rise to a material misstatement in the financial
statements themselves. If, based on the work we have performed, we
conclude that there is a material misstatement of this other
information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act
2006
In our opinion the part of the directors' remuneration report to
be audited has been properly prepared in accordance with the
Companies Act 2006.
In our opinion, based on the work undertaken in the course of
the audit:
-- the information given in the strategic report and the
directors' report for the financial period for which the financial
statements are prepared is consistent with the financial
statements; and
-- the strategic report and the directors' report have been
prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company
and its environment obtained in the course of the audit, we have
not identified material misstatements in the strategic report or
the directors' report.
We have nothing to report in respect of the following matters in
relation to which the Companies Act 2006 requires us to report to
you if, in our opinion:
-- adequate accounting records have not been kept, or returns
adequate for our audit have not been received from branches not
visited by us; or
-- the financial statements and the part of the directors'
remuneration report to be audited are not in agreement with the
accounting records and returns; or
-- certain disclosures of directors' remuneration specified by law are not made; or
-- we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the statement of directors'
responsibilities in respect of the financial statements, the
directors are responsible for the preparation of the financial
statements and for being satisfied that they give a true and fair
view, and for such internal control as the directors determine is
necessary to enable the preparation of financial statements that
are free from material misstatement, whether due to fraud or
error.
In preparing the financial statements, the directors are
responsible for assessing the company's ability to continue as a
going concern, disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting unless the
directors either intend to liquidate the company or to cease
operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial
statements
Our objectives are to obtain reasonable assurance about whether
the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an
auditor's report that includes our opinion. Reasonable assurance is
a high level of assurance but is not a guarantee that an audit
conducted in accordance with ISAs (UK) will always detect a
material misstatement when it exists. Misstatements can arise from
fraud or error and are considered material if, individually or in
the aggregate, they could reasonably be expected to influence the
economic decisions of users taken on the basis of these financial
statements.
Irregularities, including fraud, are instances of non-compliance
with laws and regulations. We design procedures in line with our
responsibilities, outlined above, to detect material misstatements
in respect of irregularities, including fraud. The extent to which
our procedures are capable of detecting irregularities, including
fraud is detailed below:
-- We obtained an understanding of the company and the sector in
which it operates to identify laws and regulations that could
reasonably be expected to have a direct effect on the financial
statements. We obtained our understanding in this regard through
discussions with management, industry research, application of
cumulative audit knowledge and experience of the sector. This is
evidenced by discussion of laws and regulations with the
management, reviewing minutes of meetings of those charged with
governance and RNSs announcements and review of legal or
professional expenditures.
-- We determined the principal laws and regulations relevant to
the company in this regard to be those arising from Companies Act
2006, London Stock Exchange listing rules, UK taxation laws
etc.
-- We designed our audit procedures to ensure the audit team
considered whether there were any indications of non-compliance by
the company with those laws and regulations. These procedures
included, but were not limited to:
o enquiries of management,
o review of minutes of board meetings,
o review of regulatory news service announcements (RNSs)
o review of legal and professional fee to understand the nature
of the costs and the existence of any non-compliance with laws and
regulations
-- As in all of our audits, we addressed the risk of fraud
arising from management override of controls by performing audit
procedures which included, but were not limited to: the testing of
journals; reviewing accounting estimates for evidence of bias; and
evaluating the business rationale of any significant transactions
that are unusual or outside the normal course of business.
Because of the inherent limitations of an audit, there is a risk
that we will not detect all irregularities, including those leading
to a material misstatement in the financial statements or
non-compliance with regulation. This risk increases the more that
compliance with a law or regulation is removed from the events and
transactions reflected in the financial statements, as we will be
less likely to become aware of instances of non-compliance. The
risk is also greater regarding irregularities occurring due to
fraud rather than error, as fraud involves intentional concealment,
forgery, collusion, omission or misrepresentation.
A further description of our responsibilities for the audit of
the financial statements is located on the Financial Reporting
Council's website at: www.frc.org.uk/auditorsresponsibilities .
This description forms part of our auditor's report.
Other matters which we are required to address
We were appointed by the Audit Committee on 21 June 2022 to
audit the financial statements for the period ending 28 February
2022 and subsequent financial periods. Our total uninterrupted
period of engagement is one financial year.
The non-audit services prohibited by the FRC's Ethical Standard
were not provided to the company and we remain independent of the
company in conducting our audit.
Our audit opinion is consistent with the additional report to
the audit committee.
Use of our report
This report is made solely to the company's members, as a body,
in accordance with Chapter 3 of Part 16 of the Companies Act 2006.
Our audit work has been undertaken so that we might state to the
company's members those matters we are required to state to them in
an auditor's report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility to
anyone, other than the company and the company's members as a body,
for our audit work, for this report, or for the opinions we have
formed.
Eric Hindson (Senior Statutory Auditor) 15 Westferry Circus
For and on behalf of PKF Littlejohn LLP Canary Wharf
Statutory Auditor London E14 4HD
27(th) July 2022
INCOME STATEMENT AND STATEMENT OF COMPREHENSIVE INCOME
For the period ended 28 February 2022
Period
ended
Note 2 8 F ebruary 2022
GBP
Revenue -
Operating and administrative expenses 4 (218,597)
Other operating income 130
Exceptional expense in relation to the IPO and acquisition 5 (361,793)
-------------------
Loss before income tax (580,260)
Income tax 8 -
Loss for the period and total comprehensive loss (580,260)
===================
Earnings per share attributable to equity owners
Basic and diluted (loss) per share 12 (4.30)
-------------------
The income statement has been prepared on the basis that all
operations are continuing operations.
The accounting policies and notes form an integral part of these
financial statements.
STATEMENT OF FINANCIAL POSITION
As at 28 February 2022
As at
28 February 2022
Note GBP
ASSETS
Current assets
Other receivables 9 86,394
Cash and cash equivalents 10 1,679,207
------------------
Total assets 1,765,601
==================
EQUITY AND LIABILITIES
Equity attributable to owners
Share capital 13 1,131,503
Share premium 954,640
Share based payments reserve 164,567
Retained earnings (580,260)
1,670,450
Current liabilities
Trade and other payables 11 95,151
Total equity and liabilities 1,765,601
==================
The financial statements were approved by the board of directors
and authorised for issue on 27(th) July 2022
and are signed on its behalf by:
Craig Foster
Director
Company Registration No.13218816
The accounting policies and notes form an integral part of these
financial statements.
STATEMENT OF CHANGES IN EQUITY
As at 28 February 2022
Share Share Share based payments reserve Retained
capital premium earnings Total
GBP GBP GBP GBP
At incorporation (23 February
2021) 3 - - - 3
Issue of ordinary shares 1,131,500 1,079,500 - - 2,211,000
Cost of shares issued - (50,000) - - (50,000)
Share based payment - (74,860) 164,567 - 89,707
Total comprehensive loss for
the period - - - (580,260) (580,260)
At 2 8 February 2022 1,131,503 954,640 164,567 (580,260) 1,670,450
Share Capital
Share capital represents the nominal value of shares that have
been issued.
Share premium
Share premium represents the difference between the nominal
value of shares issued and the total consideration received.
Share based payments reserve
Share based payments reserve is a reserve used to recognise the
cost and equity associated with the fair value of share options and
warrants.
The accounting policies and notes form an integral part of these
financial statements.
STATEMENT OF CASH FLOWS
For the period ended 28 February 2022
Period
ended
28 February 2022
GBP
Cash flows from operating activities
Loss before income tax (580,260)
Adjustments:
Share based payments 89,707
Movement in working capital
(Increase) in receivables 9 (86,394)
Increase in payables 11 95,151
-----------------
Net cash flow from operating activities (481,796)
-----------------
Cash flows from financing activities
Proceeds from issue of ordinary shares, net of costs 13 2,161,003
Net cash flows from financing activities 2,161,003
-----------------
Net increase in cash and cash equivalents 1,679,207
Cash and cash equivalents at beginning of period -
Cash and cash equivalents at end of period 1,679,207
=================
The accounting policies and notes form an integral part of these
financial statements.
NOTES TO THE FINANCIAL INFORMATION
For the period ended 28 February 2022
1. General information
Ondo Insurtech Plc (the "Company") was incorporated on 23
February 2021 in England and Wales, with registered number 13218816
under the Companies Act 2006. The registered office of the company
is 6(th) Floor 60 Gracechurch Street, London, United Kingdom, EC3V
0HR.
The Company was initially incorporated with the name Spinnaker
Acquisitions Limited. On 12 May 2021, the Company re-registered as
a public limited company. On 22 March 2022, the Company changed its
name from Spinnaker Acquisitions Plc to Ondo InsurTech Plc.
During the period ended 28 February 2022, the principal activity
of the Company was that of an investment company. Since the year
end, the Company has made an acquisition of a company in the B2B
InsurTech sector.
2. Basis of preparation
The financial information and accompanying notes are based on
the following policies which have been consistently applied:
The financial information of the Company has been prepared in
accordance with the Companies Act 2006 and UK-adopted international
accounting standards ("UK adopted IAS"). .
The financial statements are presented in Sterling, which is the
Company's functional and presentational currency and has been
prepared under the historical cost convention.
The preparation of financial information in conformity with UK
adopted IAS's requires the use of certain critical accounting
estimates. It also requires management to exercise its judgement in
the process of applying the Company's Accounting Policies. The
areas involving a higher degree of judgement or complexity, or
areas where assumptions and estimates are significant to the
Financial Information are disclosed in Note 3.
Going Concern
In accordance with the UK Corporate Governance Code 2018 (the
'Code'), the Directors have assessed going concern over a
twelve-month period from the approval of these financial statements
i.e. up to 31 July 2023 and have assessed the viability of the
Group. The assessment period for viability is aligned with the
strategic outlook timeframe. As part of this assessment, the
Directors have analysed the prospects of the Group by reference to
its current financial position, recent trading trends and momentum,
forecasts and financial projections, strategy, economic model and
the principal risks and mitigating factors.
The strategic plan forms the base case for the scenario
modelling that underpins the viability assessment and going concern
assessment. It has been built out from the Board approved budget
which includes the funds raised of GBP3,427,500 in March 2022.
Principal assumptions include: continued activity with existing
insurance partners, and new activity with pipeline partners;
pricing assumptions based on signed contracts or active
negotiations; direct cost assumptions based on current run-rates;
assumptions about fixed overhead and operational costs being
largely stable through the period; some limited capital expenditure
in technology and manufacturing.
The Directors have reviewed the Group's forecasts and
projections for the 12-month period to July 2023 (the 'Assessment
Period'), which is aligned to the Group's current strategic
planning cycle. The Directors have assessed the future viability of
the Group by reviewing the Base Case and risk scenarios based on
the Principal Risks. These circumstances have been evaluated based
on principal and emerging risks identified by management through
its risk management process, with consideration given to broader
socioeconomic factors.
2. Basis of preparation (continued)
The Directors are of the opinion that the Company has adequate
working capital to meet its obligations over the next 18 months.
The Directors have therefore made an informed judgement, at the
time of approving the financial statements, that there is
reasonable expectation that the Company has adequate resources to
continue its operational existence for the foreseeable future.
Adoption of new and revised standards
New standards, amendments and interpretations
The Company has adopted all of the new and amended standards and
interpretations issued by the International Accounting Standards
Board that are relevant to its operations and effective for
accounting periods commencing on or after 23 February 2021.
At the date of authorisation of these financial statements,
certain new standards, amendments and interpretations to existing
standards have been published by the UK adopted international
accounting standards but are not yet effective and have not been
adopted early by the Company. Management anticipates that all of
the relevant pronouncements will be adopted in the Company's
accounting policies for the first period beginning after the
effective date of the pronouncement.
Standard Key requirements Effective date for annual periods beginning on or
after:
IAS 1 Amendments to IAS1, 'Presentation of Financial 1 January 2023
Statements' regarding the classification of
liabilities
---------------------------------------------------- -----------------------------------------------------
IAS 12 Amendments to IAS12, 'Income Taxes' regarding 1 January 2023
deferred tax related to assets and liabilities
arising from a single transaction
---------------------------------------------------- -----------------------------------------------------
IAS 1 Amendments to IAS1, 'Presentation of Financial 1 January 2023
Statements' regarding the amendments of disclosure
of accounting policies
---------------------------------------------------- -----------------------------------------------------
IAS 8 Amendments to IAS 8 'Accounting Policies, Changes 1 January 2023
in Accounting Estimates and Errors' to distinguish
between accounting policies and accounting
estimates.
--------- ---------------------------------------------------- -----------------------------------------------------
IFRS 17 Insurance Contracts - Original issue 1 January 2023
--------- ---------------------------------------------------- -----------------------------------------------------
IAS 16 Amendments to IAS 16 'Property, Plant and 1 January 2022
Equipment' regarding proceeds before intended use
---------------------------------------------------- -----------------------------------------------------
The Company is currently assessing the impact of the amendments
to determine the impact they will have on the Company's accounting
policy disclosures.
3. Accounting policies
The accounting policies set out below have, unless otherwise
stated, been applied consistently.
There have been no judgements made by the Directors, in the
application of these accounting policies that have significant
effect on the financial information and estimates with a
significant risk of material adjustment in the next year except for
the judgements on share options regarding their fair value and
expected life which are estimated based on judgement.
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.
Equity
An equity instrument is any contract that evidences a residual
interest in the assets of the Company after deducting all of its
liabilities. Equity instruments issued by the Company are recorded
at the proceeds received, net of direct issue costs, or at fair
value where no proceeds are received.
Financial instruments
A financial instrument is any contract that gives rise to a
financial asset of one entity and a financial liability or equity
instrument of another entity.
Financial assets
Financial assets are recognised in the statement of financial
position when the Company becomes party to the contractual
provisions of the instrument.
Financial assets are classified into specified categories. The
classification depends on the nature and purpose of the financial
assets and is determined at the time of recognition.
Financial assets are subsequently measured at amortised cost,
fair value through OCI, or FVPL.
The classification of financial assets at initial recognition
that are debt instruments depends on the financial asset's
contractual cash flow characteristics and the Company's business
model for managing them. The Company initially measures a financial
asset at its fair value plus, in the case of a financial asset not
at fair value through profit or loss, transaction costs.
In order for a financial asset to be classified and measured at
amortised cost or fair value through OCI, it needs to give rise to
cash flows that are 'solely payments of principal and interest
("SPPI")' on the principal amount outstanding. This assessment is
referred to as the SPPI test and is performed at an instrument
level.
The Company's business model for managing financial assets
refers to how it manages its financial assets in order to generate
cash flows. The business model determines whether cash flows will
result from collecting contractual cash flows, selling the
financial assets, or both.
Subsequent measurement
For purposes of subsequent measurement, financial assets are
classified in four categories:
-- financial assets at amortised cost;
-- financial assets at fair value through OCI with recycling of cumulative gains and losses (debt instruments);
-- financial assets designated at fair value through OCI with no
recycling of cumulative gains and losses upon derecognition (equity
instruments); and
-- financial assets at FVPL.
3. Accounting policies (continued )
Financial assets at amortised cost (debt instruments)
The Company measures financial assets at amortised cost if both
of the following conditions are met:
-- the financial asset is held within a business model with the
objective to hold financial assets in order to collect contractual
cash flows; and
-- the contractual terms of the financial asset give rise on
specified dates to cash flows that are solely payments of principal
and interest on the principal amount outstanding.
Financial assets at amortised cost are subsequently measured
using the effective interest rate ("EIR") method and are subject to
impairment. Interest received is recognised as part of finance
income in the statement of profit or loss and other comprehensive
income. Gains and losses are recognised in profit or loss when the
asset is derecognised, modified or impaired. The Company's
financial assets at amortised cost include other receivables and
cash and cash equivalents.
Derecognition
A financial asset (or, where applicable, a part of a financial
asset or part of a Company of similar financial assets) is
primarily derecognised when:
-- the rights to receive cash flows from the asset have expired; or
-- the Company has transferred its rights to receive cash flows
from the asset or has assumed an obligation to pay the received
cash flows in full without material delay to a third party under a
'pass-through' arrangement; and either: (a) the Company has
transferred substantially all the risks and rewards of the asset,
or (b) the Company has neither transferred nor retained
substantially all the risks and rewards of the asset, but has
transferred control of the asset.
When the Company has transferred its rights to receive cash
flows from an asset or has entered into a pass-through arrangement,
it evaluates if, and to what extent, it has retained the risks and
rewards of ownership. When it has neither transferred nor retained
substantially all of the risks and rewards of the asset, nor
transferred control of the asset, the Company continues to
recognise the transferred asset to the extent of its continuing
involvement. In that case, the Company also recognises an
associated liability.
The transferred asset and the associated liability are measured
on a basis that reflects the rights and obligations that the
Company has retained.
Impairment of financial assets
The Company recognises an allowance for expected credit losses
("ECLs") for all debt instruments not held at fair value through
profit or loss. ECLs are based on the difference between the
contractual cash flows due in accordance with the contract and all
the cash flows that the Company expects to receive, discounted at
an approximation of the original EIR. The expected cash flows will
include cash flows from the sale of collateral held or other credit
enhancements that are integral to the contractual terms.
The Company recognises an allowance for ECLs for all debt
instruments not held at fair value through profit or loss. ECLs are
based on the difference between the contractual cash flows due in
accordance with the contract and all the cash flows that the
Company expects to receive, discounted at an approximation of the
original EIR. For credit exposures for which there has not been a
significant increase in credit risk since initial recognition, ECLs
are provided for credit losses that result from default events that
are possible within the next 12 months (a 12-month ECL). For those
credit exposures for which there has been a significant increase in
credit risk since initial recognition, a loss allowance is required
for credit losses expected over the remaining life of the exposure,
irrespective of the timing of the default (a lifetime ECL).
For other receivables due in less than 12 months, the Company
applies the simplified approach in calculating ECLs, as permitted
by IFRS 9. Therefore, the Company does not track changes in credit
risk, but instead, recognises a loss allowance based on the
financial asset's lifetime ECL at each reporting date.
3. Accounting policies (continued )
The Company considers a financial asset in default when
contractual payments are 90 days past due. However, in certain
cases, the Company may also consider a financial asset to be in
default when internal or external information indicates that the
Company is unlikely to receive the outstanding contractual amounts
in full before taking into account any credit enhancements held by
the Company. A financial asset is written off when there is no
reasonable expectation of recovering the contractual cash flows and
usually occurs when past due for more than one year and not subject
to enforcement activity.
At each reporting date, the Company assesses whether financial
assets carried at amortised cost are credit impaired. A financial
asset is credit-impaired when one or more events that have a
detrimental impact on the estimated future cash flows of the
financial asset have occurred.
Financial liabilities
Financial liabilities are classified, at initial recognition, as
financial liabilities at fair value through profit or loss, loans
and borrowings, payables, or as derivatives designated as hedging
instruments in an effective hedge, as appropriate. All financial
liabilities are recognised initially at fair value and, in the case
of loans and borrowings and payables, net of directly attributable
transaction costs. The Company's financial liabilities include
trade and other payables.
Subsequent measurement
The measurement of financial liabilities depends on their
classification, as described below:
-- loans and borrowings and trade and other payables;
-- after initial recognition, interest-bearing loans and
borrowings and trade and other payables are subsequently measured
at amortised cost using the EIR method. Gains and losses are
recognised in the statement of profit or loss and other
comprehensive income when the liabilities are derecognised, as well
as through the EIR amortisation process;
-- amortised cost is calculated by taking into account any
discount or premium on acquisition and fees or costs that are an
integral part of the EIR. The EIR amortisation is included as
finance costs in the statement of profit or loss and other
comprehensive income.
This category generally applies to trade and other payables.
Derecognition
A financial liability is derecognised when the associated
obligation is discharged or cancelled or expires.
When an existing financial liability is replaced by another from
the same lender on substantially different terms, or the terms of
an existing liability are substantially modified, such an exchange
or modification is treated as the derecognition of the original
liability and the recognition of a new liability. The difference in
the respective carrying amounts is recognised in profit or loss and
other comprehensive income.
Financial risk management
Equity instruments issued by the company are recorded at the
proceeds received, net of transaction costs. Dividends payable on
equity instruments are recognised as liabilities once they are no
longer at the discretion of the company. Incremental costs directly
attributable to the issue of new shares or options are shown in
equity as a deduction, net of tax, from the proceeds.
Financial Risk Factors
The Company's cash holdings are all held with major financial
institutions whose financial status is regularly reviewed.
Credit Risk
Credit risk arises from outstanding receivables. Management does
not expect any losses from non-performance of these receivables.
The amount of exposure to any individual counter party is subject
to a limit, which is assessed by the Board.
3. Accounting policies (continued )
The Company considers the credit ratings of banks in which it
holds funds in order to reduce exposure to credit risk, which is
stated under the cash and cash equivalents accounting policy.
Liquidity risk
The Company's continued future operations depend on its ability
to raise sufficient working capital through the issue of share
capital and generate revenue.
Capital risk management
The Company manages its capital to ensure that it will be able
to continue as a going concern while maximising the return to
stakeholders. The Company's capital structure primarily consists of
equity attributable to the owners, comprising issued capital,
reserves and retained losses.
Current and deferred tax
Current tax
The tax currently payable is based on taxable profit or loss for
the period. Taxable profit or loss differs from the profit or loss
for the financial period as reported in the statement of total
comprehensive income because it excludes items of income or expense
that are taxable or deductible in other years and it further
excludes items that are never taxable or deductible. The Company's
liability for current tax is calculated using tax rates that have
been enacted or substantively enacted by the reporting date.
Deferred tax
Deferred tax is the tax expected to be payable or recoverable on
differences between the carrying amounts of assets and liabilities
in the financial statements and the corresponding tax bases used in
the computation of taxable profit or loss.
Deferred tax liabilities are generally recognised for all
taxable temporary differences and deferred tax assets are
recognised to the extent that it is probable that future taxable
profits will be available against which deductible temporary
differences can be utilised. Such assets and liabilities are not
recognised if the temporary difference arises from the initial
recognition of other assets and liabilities in a transaction that
affects neither the taxable profit nor the accounting profit.
Deferred tax is calculated at the tax rates that are expected to
apply in the period when the liability is settled, or the asset is
realised based on tax laws and rates that have been enacted or
substantively enacted at the reporting date. Deferred tax is
charged or credited in the income statement, except when it relates
to items charged or credited in other comprehensive income, in
which case the deferred tax is also dealt with in other
comprehensive income.
Deferred tax assets and liabilities are offset when there is a
legally enforceable right to set off current tax assets against
current tax liabilities and when they relate to income taxes levied
by the same taxation authority and the subsidiary intends to settle
its current tax assets and liabilities on a net basis.
Deferred tax will be recognised on the losses incurred when the
Company has sufficient visibility over the usage of these loses and
is forecasting future profits in the short term.
Share-based payments
The company makes equity-settled share-based payments to its
directors and brokers. The fair value of options and warrants
granted is recognised in statement of comprehensive income with a
corresponding increase in equity. The fair value is measured at
grant date and spread over the period during which the receivers
become unconditionally entitled to the options. The fair value of
the options and warrants granted is measured on the Black-Scholes
framework, taking into account the terms and conditions upon which
the instruments are granted. At each balance sheet date, the
company revises its estimate of the number of options and warrants
that are expected to become exercisable.
3. Accounting policies (continued )
Critical accounting estimates and judgements
The Company makes estimates and assumptions regarding the
future. Estimates and judgements are continually evaluated based on
historical experience and other factors, including expectations of
future events that are believed to be reasonable under the
circumstances. In the future, actual results may differ from these
estimates and assumptions. There are no estimates and assumptions
that have a significant risk of causing a material adjustment to
the carrying amounts of assets and liabilities within the next
financial period except for the judgements on share based
payments.
Share based payments
The estimates of share-based payment costs require that
management selects an appropriate valuation model and makes
decisions on various inputs into the model, including the
volatility of its own share price, the probable life of the options
before exercise, and behavioural consideration of employees. A
significant element of judgement is therefore involved in the
calculation of the charge.
4. Operating expenses by nature
2022
GBP
Subscriptions 10,895
Professional fees 87,786
Share based payments 89,707
Sundry expenses 30,209
218,597
--------
5. Exceptional expenses
2022
GBP
Professional fees related to the IPO 161,793
Professional fees related to the acquisition and readmission 200,000
361,793
--------
6. Auditors' remuneration
2022
GBP
Audit services 35,000
Non-audit services:
* Assurance services related to the IPO 17,500
* Assurance services related to the acquisition and
readmission 75,000
127,500
--------
7. Directors' remuneration
The average monthly number of employees, which were solely the
Directors, during the period was 5.
Directors' remuneration for the period ended 28 February 2022
was:
Name Share Total
based payments remuneration
2022 2022
GBP GBP
Andrew Morrison 35,856 35,856
Stefania Barbaglio 7,694 7,694
Anthony Harpur 21,357 21,357
Alan Hume 12,106 12,106
Claudia Stijlen - -
77,013 77,013
No pension contributions were paid.
8. Taxation
2022
GBP
Current tax -
Deferred tax -
Tax charge/ (credit) for the period -
-----
The Company's unutilised tax losses carried forward at 28
February 2022 amounted to GBP93,002. A deferred tax asset has not
been recognised due to uncertainty over the timing of the
utilisation of the losses.
The standard rate of tax for the current year, based on the UK
effective rate of corporation tax is 19%. The actual tax for the
current and previous year varies from the standard rate for the
reasons set out in the following reconciliation:
2022
GBP
Loss for the period (580,260)
Tax on ordinary activities at standard rate ( 110,249)
Effects of:
Expenses not deductible for tax purposes 92,579
Tax losses available for carry forward against future profits 17,670
Tax for the period -
-----------
On 24 May 2021, the Government enacted that from 1 April 2023
the corporation tax rate would increase to 25% for companies with
profits of over GBP250,000. A small profits rate will also be
introduced for companies with profits of GBP50,000 or less so that
they will continue to pay corporation tax at 19%. From this date
companies with profits between GBP50,000 and GBP250,000 will pay
tax at the main rate reduced by a marginal relief providing a
gradual increase in the effective corporation tax rate.
9. Other receivables
2022
GBP
Other receivables 86,394
-------
86,394
=======
10. Cash and cash equivalents
2022
GBP
Cash at bank 1,679,207
----------
1,679,207
==========
11. Other payables
Amounts falling due within one year:
2022
GBP
Other payables 17,222
Accruals 77,929
-------
95,151
=======
12. Earnings per share
The basic earnings per share is calculated by dividing the loss
attributable to equity shareholders by the weighted average number
of shares in issue.
The Company had in issue 22,630,060 ordinary shares at 28
February 2022. The loss attributable to equity holders and weighted
average number of ordinary shares for the purposes of calculating
diluted earnings per ordinary share are identical to those used for
basic earnings per ordinary share.
2022
GBP
Loss for the period attributable to equity holders (GBP) 580,260
Weighted average number of shares in issue 13,485,234
Basic and diluted earnings per share (GBP) (4.30)
===========
13. Share capital and share premium
On 18 March 2021, the Company sub-divided each ordinary share of
GBP1 into 20 ordinary shares of GBP0.05 each.
On 13 April 2021, the company issued 1,300,000 ordinary shares
of GBP0.05 each.
On 28 July 2021, the company issued 20,810,000 ordinary shares
of GBP0.05 each at a price of GBP0.1 per ordinary shares creating a
share premium of GBP1,040,500. Issue costs of GBP50,000 in relation
to the share issue have been offset against the premium
On 10 September 2021, the Company issued 520,000 new ordinary
shares of GBP0.05 each at a price of GBP0.0125 per ordinary share
creating a share premium of GBP39,000.
The share-based payment charge for the 500,000 'Broker' warrants
have been set off against the share premium as options granted to
the broker were in connection with fundraising.
Number of Share Share
O rdinary shares capital premium Total
---------------------------------------------- ------------------ ---------- --------- ----------
GBP GBP GBP
At Incorporation 3 3 - 3
Sub-division of ordinary shares (18/03/2021) 60 3 - 3
Issue of ordinary shares
(13/04/2021) 1,300,000 65,000 - 65,000
Issue of ordinary shares
(28/07/2021) 20,810,000 1,040,500 990,500 2,031,000
Issue of ordinary shares
(10/09/2021) 520,000 26,000 39,000 65,000
Share based payments for broker warrants - - (74,860) (74,860)
------------------ ---------- --------- ----------
A t 28 February 2022 22,630,060 1,131,503 954,640 2,086,143
================== ========== ========= ==========
14. Financial instruments
The Company's financial instruments comprise cash, other
receivables and other payables. The main purpose of these financial
instruments is to provide finance for the Company's future
activities and day to day operational needs.
The main risks faced by the Company are limited to interest rate
risk on surplus cash deposits and liquidity risk associated with
raising sufficient funding to meet the operational needs of the
business.
The Board reviews and agrees policies for managing these risks
and they are summarised below.
Financial assets by category
The categories of financial assets included in the statement of
financial position and the headings in which they are included are
as follows:
2022
At amortised cost GBP
Other receivables 86,394
Cash and cash equivalents 1,679,207
1,765,601
==========
Financial liabilities by category
The categories of financial liabilities included in the
statement of financial position and the headings in which they are
included are as follows:
2022
At amortised cost GBP
Other payables 95,151
=======
Interest rate risk
The Company manages the interest rate risk associated with the
Company's cash assets by ensuring that interest rates are as
favourable as possible, whilst managing the access the Company
requires to the funds for working capital purposes.
The Company's cash and cash equivalents are subject to interest
rate exposure due to changes in interest rates. Short-term
receivables and payables are not exposed to interest rate risk.
Capital risk management
The Company manages its capital to ensure that it will be able
to continue as going concern while maximising the return to
stakeholders through optimisation of the debt and equity balance.
The capital structure of the Company currently consists of cash and
cash equivalents, and equity attributable to equity holders of the
Company, comprising issued capital, reserves and retained earnings,
all as disclosed in the Statement of Financial Position.
Significant accounting policies
Details of the significant accounting policies and methods
adopted, including the criteria for recognition, the basis of
measurement and the basis on which income and expenses are
recognised, in respect of each class of financial asset, financial
liability and equity instrument disclosed in Note 3 to the
financial statements.
15. Equity-settled share based payments
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 Company's estimate of
shares that will eventually vest and adjusted for the effect of
non-market based vesting conditions.
On 28 July 2021, 2,211,005 share options were granted with an
exercise price of GBP0.10 and an expiry period of 3 years.
On 28 July 2021, two tranches of share warrants were issued:
10,405,000 warrants at an exercise price of GBP0.20 with an expiry
period of 4 years and 500,000 warrants at an exercise price of
GBP0.10 with an expiry period of 3 years.
The fair value of the options has been calculated using the
Black-Scholes valuation model. The assumptions used in the fair
value calculation were as follows:
Options
Date of grant 28 July 2021
Number 2,211,005
Exercise price (pence) 10p
Risk free interest (%) 0.5%
Expected volatility (%) 37.8%
Expected life (years) 2.9
Fair value 0.52
Option life 3 years
The total share-based payment expense recognised in the income
statement for the period ended 28 February 2022 in respect of the
share options granted was GBP89,707.
Volatility was determined by reference to the standard deviation
of daily share prices.
At the date of grant, the 500,000 warrants that came under the
scope of IFRS 2 Share based payments were valued based on an agreed
fee payable to the broker on completion of the fundraising. This
resulted in a charge of GBP74,860 against share premium in respect
of share issue costs.
No share based payments charge arose in respect of the
10,405,000 warrants granted to investors.
16. Controlling party
The Directors do not consider there to be an ultimate
controlling party.
17. Subsequent events
On 21 March 2022, the Company was readmitted to the London Stock
Exchange following the reverse takeover of LeakBot Limited. On
readmission the company also changed its name from Spinnaker
Acquisitions Plc to Ondo InsurTech Plc.
On 21 March 2022, the Company raised GBP198,538 by allotment of
1,985,377 ordinary shares of GBP0.05 each at a price of GBP0.1 per
ordinary share. On the same day company raised GBP5,226,501 by
allotments of 43,554,175 ordinary shares of GBP0.05 each at a price
of GBP0.12 per ordinary share.
On 22 March 2022, a subsidiary called Leakbot USA Inc. was
incorporated in the state of Delaware.
18. Copies of the Annual Report
Copies of the annual report are available on the Company's
website at www.ondoplc.com and from the Company's registered office
6(th) Floor, 60 Gracechurch Street, London, England, EC3V 0HR.
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END
FR BCGDRISDDGDR
(END) Dow Jones Newswires
July 28, 2022 02:00 ET (06:00 GMT)
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