TIDMAVP
RNS Number : 0740U
Armstrong Ventures PLC
04 April 2016
Armstrong Ventures plc
("Armstrong" or the "Company")
Final Results for the year ended 31 December 2015
Armstrong (AIM:AVO), the AIM listed company investing in the
media, technology and healthcare sectors, today announces its
audited final results for the year ended 31 December 2015.
The audited Report and Accounts for the year ended 31 December
2015 will shortly be sent to shareholders and will also be
available on the Company's website: www.armstrongventures.com.
For further information please contact:
Armstrong Ventures plc
Sean Nicolson
avp@nicolsons.eu
Cairn Financial Advisers LLP (Nomad)
Sandy Jamieson/James Caithie
Tel: +44 20 7148 7900
Peterhouse Corporate Finance Limited
Eran Zucker/Lucy Williams
Tel: +44 20 7469 0930
Chairman's Statement
Introduction
I am pleased to welcome you to my first report as Chairman of
Armstrong for the year ended 31 December 2015.
Financial Review
The year under review has two distinct periods. The first period
ended on 17 July 2015. Prior to that date the Company had very
limited cash resources and had spent some time seeking investment
opportunities in the resources and energy sectors. At the general
meeting held on 17 July 2015 shareholders approved resolutions in
respect of the issue of 19,402,916,660 ordinary shares to raise
GBP2.33 million before expenses and the Company's investing policy
was changed to focus on opportunities in the media, technology and
healthcare sectors. On 17 July 2015 Peter Read and I joined the
board and Manish Kotecha and Peter Redmond resigned on that date.
On 20 August 2015 Haresh Kanabar resigned as a director.
During the year under review the Company operated as an
investing company reviewing investment opportunities in line with
the Company's policies in force during the year. As such, the
Company did not have any operating businesses. The Company recorded
a loss of GBP322,186 and a loss per share of 0.003p. This compares
to a corresponding loss last year of GBP184,079 (a loss per share
of 0.008p).
Investment Strategy
The board believes that the Company's new investing focus allied
with an appropriate level of cash resources will offer a realistic
opportunity to identify and invest in businesses with the potential
to appreciate in value in the short to medium term and to enhance
shareholder value. Since Peter Read and I were appointed to the
board, we have taken active steps to seek out such investment
propositions.
The board is seeking to invest in businesses in the media,
technology and healthcare sectors which have some or all of the
following characteristics:
-- strong management with a proven track record;
-- ready for investment without the need for material
re-structuring by the Company;
-- generating positive cash flows or likely to do so in the
short term;
-- by the injection of new finances or specialist management,
the Company can enhance the prospects and therefore the future
value of the investment;
-- the potential to deliver significant returns for the
Company.
Whilst the board will be principally focused on making an
investment in private businesses, investments in listed businesses
will also be considered if this presents, in the board's judgement,
a clear opportunity for investment growth. With the board's
experience, the Company intends to be an active investor in
situations where the Company can make a clear contribution to the
progress and development of the investment.
The directors believe that their broad collective experience
together with their extensive network of contacts will assist them
in the identification, evaluation and funding of appropriate
investment opportunities. When necessary, other external
professionals will be engaged to assist in the due diligence on
prospective targets and their management teams. The board will also
consider appointing additional directors with relevant experience
if required.
There will be no limit on the number of projects in which the
Company may invest. The Company's financial resources may be
invested in a number of propositions or in just one investment,
which may be treated as a reverse takeover under Rule 14 of the AIM
Rules for Companies. Where the Company builds a portfolio of
related assets it is possible that there may be cross-holdings
between such assets. The Company may invest through debt and
similar instruments.
The board's primary objective is to secure for the shareholders
the best possible value consistent with achieving, over time, both
capital growth and income for shareholders.
MelodyVR
On 13 January 2016 (which falls outside the period under
review), the Company invested GBP212,500 in MelodyVR Ltd (MelodyVR)
by means of secured convertible loan notes (Loan Notes). On 30
March 2016 the Company invested a further GBP57,500 in MelodyVR by
means of additional Loan Notes.
MelodyVR was established in early 2015 to create virtual reality
content by capturing live music performances. Virtual reality (VR)
is a term used to describe a three dimensional environment which
can be explored and interacted with by a user. VR content created
by MelodyVR will be viewed using VR headsets that are currently
being developed by a number of technology companies including
Oculus (owned by Facebook), HTC, Google, Sony and Samsung,
providing users with an immersive 360 degree experience.
MelodyVR has developed its own technology for the recording and
live streaming of music performances. MelodyVR plans to make live
and recorded music content available to users via its own app and
third party VR platforms. It is intended that the MelodyVR app will
be deployed across Oculus Rift, Android, iOS, Samsung Gear VR, HTC
Vive, Playstation VR and other platforms.
MelodyVR has entered into a number of exclusivity agreements
with some of the major music festival and event promoters
facilitating the filming and live broadcast of music events in a
virtual reality format. It is intended that the MelodyVR app will
be launched in 2016.
The Loan Notes bear interest at a rate of 10% per annum and are
repayable on or before 31 March 2017. The Loan Notes may be
converted at the option of Armstrong into equity shares in MelodyVR
on 31 March 2017 or earlier upon the sale or listing of MelodyVR or
upon the raising of equity finance by MelodyVR.
The Company's investment in MelodyVR is relatively small in
proportion to the Company's cash resources. If the Loan Notes are
converted the Company would have a minority interest in MelodyVR.
However, the anticipated launches in 2016 of VR headsets by a
number of major manufacturers, means that MelodyVR premium music
service could develop very rapidly. In such circumstances, the
Company would consider converting its Loan Notes into an equity
holding in MelodyVR. In addition, as MelodyVR grows, the Company
would also consider making further debt and equity investments.
Outlook
The Company is now well positioned to move forward and will
continue pursuing an investment strategy that seeks to generate
value for shareholders through considered investments in high
performance, ambitious businesses offering high growth
opportunities in the media, technology and healthcare sectors. The
board of Armstrong is excited by the opportunities offered by
companies such as MelodyVR that provide content to be used on the
VR headsets being launched by a number of major technology
companies in 2016. The board continues to explore VR and other
investment opportunities.
Sean Nicolson
Chairman
1 April 2016
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2015
2015 2014
Note GBP GBP
Continuing operations: - -
Administrative expenses (326,788) (184,079)
------------------ -------------------
OPERATING LOSS (326,788) (184,079)
Finance income 4,602 -
------------------ -------------------
LOSS FOR THE YEAR BEFORE TAXATION (322,186) (184,079)
Taxation - -
------------------ -------------------
NET LOSS AND TOTAL COMPREHENSIVE
INCOME
FOR THE YEAR (322,186) (184,079)
------------------ -------------------
LOSS PER SHARE - basic and diluted
from continuing operations 2 (0.003)p (0.008)p
======== =========
STATEMENT OF CHANGES IN EQUITY
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April 04, 2016 06:56 ET (10:56 GMT)
FOR THE YEAR ENDED 31 DECEMBER 2015
Share Share Share Retained Total
option
capital Premium Reserve Losses Equity
GBP GBP GBP GBP GBP
Balance at 1
January
2014 818,360 4,262,258 - (4,694,814) 385,804
Loss for the year
and total
comprehensive
loss
for the year - - - (184,079) (184,079)
Share issue 157,143 172,857 - - 330,000
Share issue costs - (9,915) (9,915)
Grant of share
options - - 30,550 - 30,550
------------------ -------------------- ------------------ --------------------- -----------------
Balance at 31
December
2014 975,503 4,425,200 30,550 (4,878,893) 552,360
Loss for the year
and total
comprehensive
loss
for the year - - - (322,186) (322,186)
------------------ -------------------- ------------------ --------------------- -----------------
975,503 4,425,200 30,550 (5,210,079) 221,174
Share issue 1,950,250 392,042 - - 2,342,292
Share issue costs - (293,850) - - (293,850)
Options lapsed - - (30,550) 30,550 -
Grant of share
options/warrants - - 110,762 - 110,762
------------------ -------------------- ------------------ ------------------ -----------------
Balance at 31
December
2015 2,925,753 4,523,392 110,762 (5,170,529) 2,389,378
======== ========== ======== ======== ========
STATEMENT OF FINANCIAL POSITION
FOR THE YEAR ENDED 31 DECEMBER 2015
2015 2014
Note GBP GBP
NON-CURRENT ASSETS
Available for sale investments - -
------------------ -------------------
- -
------------------ -------------------
CURRENT ASSETS
Trade and other receivables 5,024 19,315
Cash and cash equivalents 2,401,021 564,759
------------------ -------------------
TOTAL ASSETS 2,406,045 584,074
======== =========
CURRENT LIABILITIES
Trade and other payables 16,667 31,714
------------------ -------------------
NET ASSETS 2,389,378 552,360
======== =========
EQUITY
Share capital 2,925,753 975,503
Share premium account 3 4,523,392 4,425,200
Share option reserve 110,762 30,550
Retained earnings (5,170,529) (4,878,893)
------------------ --------------------
TOTAL EQUITY 2,389,378 552,360
========= ==========
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2015
2015 2014
Note GBP GBP
CASH FLOWS FROM OPERATING ACTIVITIES
Loss before taxation (322,186) (184,079)
Adjustments for:
Share based payment charge 110,762 30,550
------------------ ------------------
OPERATING CASHFLOW BEFORE WORKING
CAPITAL CHANGES (211,424) (153,529)
Decrease/(Increase) in trade
and other receivables 14,290 (16,946)
(Decrease)/Increase in trade
and other payables (15,046) 1,800
------------------ ------------------
NET CASH OUTFLOW FROM OPERATING
ACTIVITIES (212,180) (168,675)
------------------ ------------------
CASH FLOWS FROM FINANCING ACTIVITIES
Issue of shares 2,342,292 330,000
Share issue costs (293,850) (9,915)
------------------ ------------------
NET CASH INFLOW FROM FINANCING
ACTIVITIES 2,048,442 320,085
========= =========
NET INCREASE IN CASH AND CASH
EQUIVALENTS 1,836,262 151,401
Cash and cash equivalents brought
forward 564,759 413,349
------------------ ------------------
CASH AND CASH EQUIVALENTS CARRIED
FORWARD 2,401,021 564,759
========= =========
NOTES TO THE FINANCIAL STATEMENTS
1. GENERAL INFORMATION
Armstrong Ventures plc is a public limited company incorporated
in England and Wales. The shares of the Company are quoted on the
AIM stock exchange.
2. EARNINGS PER SHARE
The basic earnings per share is based on the loss for the year
divided by the weighted average number of shares in issue during
the year. The weighted average number of ordinary shares for the
year ended 31 December 2015 assumes that all shares have been
included in the computation based on the weighted average number of
days since issue.
2015 2014
GBP GBP
Loss attributable to equity holders
of the Company:
Continuing and total operations (322,186) (184,079)
------------------- ------------------
No. of No. of
shares shares
Weighted average number of ordinary
shares in issue for basic and fully
diluted earnings 12,611,922,485 2,398,170,370
----------------------- ---------------------------
Pence Pence per
per
Share share
Loss per share
Basic and diluted:
Continuing and total operations (0.003)p (0.008)p
========= ==========
3. ISSUED SHARE CAPITAL Number Nominal Share
of
Shares Value premium
Issued and fully paid No. GBP GBP
At 31 December 2014:
Ordinary shares of 0.01p
each 3,672,534,360 367,254
Deferred shares of 0.24p
each 150,520,616 361,249
Deferred shares of 0.95p
(MORE TO FOLLOW) Dow Jones Newswires
April 04, 2016 06:56 ET (10:56 GMT)
each 26,000,000 247,000
------------------------- ------------------- --------------------
3,849,054,976 975,503 4,425,200
============= ========= =========
Issue of new shares
Ordinary shares of 0.01p
each 19,502,499,995 1,950,250 392,042
Cost of issue (293,850)
------------------------- ------------------- --------------------
23,351,554,971 1,950,250 98,192
============= ========= =========
At 31 December 2015:
Ordinary shares of 0.01p
each 23,175,034,355 2,317,504
Deferred shares of 0.24p
each 150,520,616 361,249
Deferred shares of 0.95p
each 26,000,000 247,000
------------------------- ------------------- --------------------
23,351,554,971 2,925,753 4,523,392
============= ========= =========
The deferred shares do not confer upon the holders right to any
dividends or the right to attend or vote at general meetings of the
Company.
On 17 July 2015 the Company issued 19,402,916,660 ordinary
shares of 0.01p each for cash at 0.012p per share, raising
GBP2,328,250 before expenses.
On 4 December 2015 the company issued 99,583,335 ordinary shares
of 0.01p each for cash at 0.014p per share under the terms of the
exercise of warrants raising GBP13,941.
4. SHARE OPTIONS AND DIRECTOR WARRANTS
EQUITY-SETTLED SHARE OPTION SCHEME
The company operates share-based payment arrangements to
remunerate directors and key employees in the form of warrants and
has previously operated a share option scheme. 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 18 February 2014, Haresh Kanabar and Manish Kotecha were
granted options to subscribe for 147,077,405 and 63,033, 173 new
ordinary shares, respectively, at an exercise price of 0.025p per
share. The vesting conditions of such options were that the mid
market closing price of the Company's ordinary shares is at or
above 0.04p at close of business on five consecutive trading days.
Mr Kanabar and Mr Kotecha resigned on 20 August 2015 and 17 July
2015 respectively. On the dates of their respective resignations
the option vesting conditions had not been satisfied and so the
options expired in accordance with their terms on the respective
resignation dates.
The following table sets out the details of these options
granted:
Number Number
of of
options options
at at
31 December Lapsed Exercised 31 December Exercise Expiry
in
Option 2014 the year in the 2015 price date
holder year
Haresh
Kanabar 147,077,405 (147,077,405) - - 0.025p 20.8.2015
Manish
Kotecha 63,033,173 (63,033,173) - - 0.025p 17.7.2015
------------------------- ------------------------- -------------------- -------------------- ------------------ -----------------
210,110,578 (210,110,578) - -
=========== ============ ========== ==========
On 31 July 2015 the Company issued 461,509,020 warrants to both
Sean Nicolson and Peter Read as part of their remuneration terms
("Warrants"). The Warrants are exercisable at 0.012p per ordinary
share and have an expiry date of 31 July 2020.
The fair value of these options was determined using the
Black-Scholes option pricing model and was 0.01199p per option.
The significant inputs to the model in respect of the options
granted were as follows:
2015 2014
Grant date shared price 0.012p 0.025p
Exercise share price 0.012p 0.025p
No. of share options 923,018,040 210,110,578
Risk free rate 0.5% 0.5%
Expected volatility 50% 50%
Expected option life 5 years 10 years
Calculated fair value per share 0.01199p 0.01454p
The total share-based payment expense recognised in the income
statement for the year ended 31 December 2015 in respect of share
options granted was GBP110,762.
Number Issued Issued Exercised Number
of in in the of
Warrants the year year (share in the Warrants
at at
31 December (services) subscription) year 31 December Exercise Expiry
Option 2014 2015 price date
holder
Sean
Nicolson - 461,509,020 41,666,666 - 503,175,686 0.012p 31.7.2020
Peter
Read - 461,509,020 41,666,666 - 503,175,686 0.012p 31.7.2020
------------------------- ------------------------ ------------------------- -------------------- --------------------------- ------------------ -----------------
- 923,018,040 83,333,332 - 1,006,351,372
============ =========== ============ ========== =============
As a result of the placing on 17 July 2015, the company has
created and issued a total of 4,222,916,655 warrants. One warrant
has been issued for every four new shares subscribed for by the
placees pursuant to the placing. These warrants may be exercised at
any time on or before 31 July 2018 and shall entitle the warrant
holder to subscribe for one Ordinary share for each warrant help at
0.014p.
5. RELATED PARTY TRANSACTIONS
During the reporting period the Company was invoiced GBP35,600
for management services by Poonam & Roshni Limited, a company
controlled by Haresh Kanabar, GBP29,000 for management services by
Remkay Limited, a company controlled by Manish Kotecha, and
GBP34,000 for management services by Catalyst Corporate Consultants
Limited, a company controlled by Peter Redmond. These amounts have
been included in directors' remuneration.
On 31 July 2015 the Company issued 461,509,020 warrants to both
Sean Nicolson and Peter Read as part of their remuneration terms
("Warrants"). The Warrants are exercisable at 0.012p per ordinary
share and have an expiry date of 31 July 2020. Also issued were
41,666,666 share subscription warrants to both Sean Nicolson and
Peter Read.
6 POST YEAR END EVENTS
On 13 January 2016 the Company invested GBP212,500 in MelodyVR
Ltd (MelodyVR) by means of secured convertible loan notes (Loan
Notes). The Loan Notes bear interest at a rate of 10% per annum and
are repayable on or before 31 March 2017. The Loan Notes may be
converted at the option of Armstrong into equity shares in MelodyVR
on 31 March 2017 or earlier upon the sale or listing of MelodyVR or
upon the raising of equity finance by MelodyVR. A further loan note
investment of GBP57,500 was made on 30 March 2016 on the same terms
as the prior investment.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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