TIDMRMS
RNS Number : 3254D
Remote Monitored Systems PLC
25 June 2019
Certain information contained in this announcement would have
been deemed inside information for the purposes of Article 7 of
Regulation (EU) No 596/2014 until the release of this
announcement.
25 June 2019
Remote Monitored Systems plc ("Remote Monitored Systems", the
"Company" or the "Group")
Final Results for the Year to 31 December 2018 and Notice of
AGM
Financial Overview
During the year the Group recorded revenues of GBP857,970
compared with GBP788,718 for the year ended 31 December 2017. The
operating loss for the year ended 31 December 2018 was GBP1,081,879
(year ended 31 December 2017: GBP2,148,774). Administrative
expenses amounted to GBP1,415,446 (year ended 31 December 2017
restated: GBP2,209,385), see table and the bullet points below for
details in relation to the reduction in administrative expenses.
The loss after tax for the year was GBP1,122,834 (year ended 31
December 2017: GBP1,897,479). The loss per share (after
consolidation of the share capital) was 0.35 pence (2017: loss per
share after consolidation of share capital of 1.82 pence).
-- The total revenue figure GBP857,970 for December 2018 relates
to Geocurve, no revenues were generated by GyroMetric during 2018.
In 2017 GBP638,203 was generated by Geocurve and the remaining
GBP150,515 by the closed operations. Geocurve secured a GBP1.1m
contract at the beginning of 2018 to survey the Thames. A
significant investment of manpower was required to get the Thames
project running successfully and efficiently; in Q3 2018 Geocurve
was able to take on new projects alongside the Thames project.
Approximately 80% of the initial phase of the Thames contract was
invoiced in the year ended 31 December 2018
-- Consolidated net assets at 31 December 2018 amounted to
GBP668,683 (31 December 2017: GBP636,315).
-- Cash balances at the year-end amounted to GBP109,381 (2017: GBP502,998).
-- During the year the Company raised GBP744,230 net of costs through the issue of new shares.
-- Operational salaries incurred in Geocurve amounting to
GBP374,446 have been reclassified from administrative expenses to
cost of sales in 2018. A comparative adjustment of GBP359,194 for
2017 has also been made for consistency. The reclassification took
place as a result of a reconsideration of what constituted direct
costs by the new management.
-- Significant administrative cost reductions were achieved in
comparison with 2017, both by reducing costs in the continuing
operations as well as by closing the training and US
businesses:
2018
2017 (restated) Reduction Reduction
(GBP) (GBP) (GBP) (%)
Audit and accountancy fees 52,067 187,620 (135,553) 72%
Plc costs (broker, Nomad, PR
& Marketing) 146,949 220,339 (73,390) 33%
Board costs 157,732 337,158 (179,426) 53%
Other 499,668 441,892 57,776 13%
Sub Total 856,416 1,187,009 (330,593) 28%
Costs of operations closed
in 2018 164,826 587,326
Depreciation & Impairments 394,204 435,050
Total Administrative Expenses
(as per statement of comprehensive
income) 1,393,791 2,209,385
-- The reduction in audit and accountancy fees is due to a new
financial planning and control system implemented during the
period.
-- Depreciation increased to GBP151,670 (2017: GBP61,772) as a
result of additional depreciation following the acquisition of the
Pegasus II equipment by Geocurve at the beginning of March
2018.
-- Impairments of GBP267,266 relates to the release of goodwill
arising from the acquisition of Geocurve in 2015 and GyroMetric in
2018 on a straight-line basis over 5 years.
-- Geocurve became the first company in the UK, and one of only
a few companies in Europe, to acquire a Pegasus II multi-sensor
surveying system which has world leading surveying capabilities and
opens up many business opportunities. The system, with an
acquisition value of GBP0.5m, was acquired on 19 February 2018 from
Academy Leasing Ltd.
-- 67% of the Pegasus II equipment finance was paid during the
year ended December 2018 with the remaining finance to be paid
before the end of 2019. The prompt payment of finance is again part
of the initiative to drive down costs.
-- On 30 April 2018, Remote Monitored Systems granted a total of
100,000,000 options (5,000,000 after consolidation of share
capital) to subscribe for ordinary shares in the Company
("Options") to certain employees. The Options can be exercised in
whole or in part, subject to meeting revenue and profit based
vesting conditions, at any time up to the fifth anniversary of
grant at a price of 0.06p per option (1.2p after consolidation of
share capital), subject to the overriding condition that no Option
may be exercised unless the quoted price of the Company's ordinary
shares is at least 2.0p.
-- In April 2018, the Group announced the acquisition of 36.9%
of the enlarged share capital of GyroMetric for a cash
consideration of GBP250,000. In August 2018, the Group announced a
further investment of GBP273,600 (funded by issuing new share
capital) in GyroMetric increasing the shareholding from 36.9% to
57.8% and thus gained control of the entity. The investment in
GyroMetric provides the Group's shareholders with a stake in a new
and unique technology with promising prospects. The Group's
investment in GyroMetric will continue to be developed through
close operational support and involvement. GyroMetric will be an
important component of growth and shareholder value in the months
and years ahead.
Following the year end, the Group raised GBP350,000 to support
the growth of the Group's core areas of business, to provide
working capital, and to leave the Company free of debt apart from
the remaining payments for the Pegasus equipment. A total of
53,846,154 ordinary shares of 0.2p nominal value each were placed
with investors at 0.65p per share.
Outlook
The Group continues to make progress across all elements of its
business.
Geocurve, having experienced a slower than expected start to
2019, has prioritised profitability over growth. Cost saving
measures have been implemented with the intention of becoming
self-financing in 2019, albeit with revenues expected to be lower
than those in 2018.
GyroMetric, which will be conducting trials for two major wind
turbine manufacturers in 2H 2019, has recently signed a contract
for a technical cooperation with a major UK supplier to the energy
and petrochemical industries and as a result of the recent
successful recruitment of a Technical Sales Director, a number of
promising opportunities in new sectors, where lead times are
typically shorter, are already being pursued.
The Board is determined to deliver value to shareholders and
continues to examine opportunities to grow both organically and
through acquisition of complementary businesses and technologies
which can enhance growth in shareholder value.
Annual Report
The Annual Report and Accounts for the year ended 31 December
2018 ("Annual Report") will be sent to shareholders today and will
also be available on the website at
www.remotemonitoredsystems.com.
Annual General Meeting
The Company's Annual General Meeting ("AGM") will be held at the
offices of Peterhouse Capital Limited, New Liverpool House, 15
Eldon Street, London, EC2M 7LD on 29 July 2019 at 10.30am.
The Notice of AGM and Forms of Proxy are being dispatched to
shareholders today and are will also be available on the website at
www.remotemonitoredsystems.com.
Acknowledgments
On behalf of the Board, I would like to thank our business
partners, customers, employees and valued shareholders for their
continued support.
Nigel Burton
Chairman and Non-Executive Director
25 June 2019
-S -
Certain information contained in this announcement would have
been deemed inside information for the purposes of Article 7 of
Regulation (EU) No 596/2014 until the release of this
announcement.
ENQUIRIES:
Remote Monitored Systems plc
Trevor Brown (Executive Director) +41 7941 55384
Nigel Burton (Non-Executive Chairman) +44 7785 234447
SP Angel Corporate Finance LLP +44 20 3470 0470
Stuart Gledhill
Jeff Keating
Caroline Rowe
Peterhouse Corporate Finance +44 20 7469 0930
Lucy Williams
Fungai Ndoro
CHAIRMAN'S STATEMENT
2018 saw significant change for the Company, with the transition
to a largely new Board and closure of the loss making training
business all completed in January 2018. The business now comprises
Geocurve, a leading provider of survey and inspection services, and
the 58% interest in GyroMetric Systems, which provides digital
monitoring and safeguarding systems for rotating shafts. During the
year Geocurve grew significantly, with revenues up by 34%, whilst
two investments were made in GyroMetric Systems. The name of the
company was changed to reflect the new focus and direction of the
business, with a new website launched in November.
Survey & Inspection
Geocurve
During 2018 Geocurve continued to provide Survey and Inspection
services to a range of major blue-chip companies and government
agencies whilst allocating significant resources to the Thames
Estuary contract.
In January 2018, Geocurve was awarded a contract to provide an
innovative technology-based 3D and Virtual Reality survey service
for the Environment Agency's Thames Estuary Asset Management 2100
(TEAM2100) programme, which initially provides a fixed revenue of
GBP1.1m over three years.
In April 2018, Geocurve was selected as a specialist 'UAV Survey
and Inspection' Preferred Supplier by Aviva plc to provide a range
of inspection and survey services to their UK customer base. This
followed the successful use of Unmanned Aerial Vehicles (UAVs) to
create comprehensive roof condition surveys for a set of
Aviva-insured historic properties in central Edinburgh. The high
definition data captured by the UAVs was processed into a complete
set of geo-tagged images by Geocurve's Geo-Spatial Data Centre.
In July 2018, Geocurve commenced an initial four-month contract
with Hesselberg Hydro, a specialist in the application of asphalt
in hydraulic engineering, and in particular systems for erosion
protection, underwater scour protection and waterproofing. The
contract can be extended on an indefinite basis and includes
options to add extra services in the future.
Also in July 2018, Geocurve, in conjunction with Essex
University, developed a room scale Virtual Reality suite. With this
resource, using UAV captured imagery, 3D models can be developed by
geo-referencing and stitching together many high-resolution images.
This technique has widespread potential usage for environmental and
industrial applications. Until now information has been displayed
using 2D projections of 3D computer information, importing data
into the new system permits visualisation and identification in a
way not possible before. Geocurve has already provided the first
Virtual Reality ("VR") deliverables to a commercial client using
this technology with the results significantly exceeding
expectations.
As announced on 29 March 2019, Geocurve experienced a slower
than expected start to 2019, largely as a result of the need to
dedicate more resources than expected to the Environment Agency's
Thames Estuary Asset Management 2100 (TEAM2100) programme. As a
result of reviewing progress against the contract, GBP140,000 of
revenue was deferred from 2018 to 2019. Additional data has been
successfully delivered to the client, and Geocurve continues to
work closely with the client to deliver the remainder of the
contract.
Whilst the deferral of revenue noted above has resulted in
reported turnover for the year to 31 December 2018 being lower than
our original expectations (as announced in our trading update of 9
January 2019), some of this revenue has been recognised in H1 2019
with the remainder scheduled to be invoiced and paid in the second
half of 2019.
Cost saving measures have been implemented to minimise the
effects of the resulting delays.
Geocurve continues to focus on the acquisition of major
corporate customers and to pursue its ambition to be the UK market
leader in the supply of innovative VR and Artificial Intelligence
("AI") surveying services to specialist customers on critical
infrastructure projects.
The directors believe that Geocurve's skill set and its use of
innovative technology has the potential to transform the practice
of surveying, and reflects Geocurve's continuing transition to
becoming:
1. A leading technology-based UK provider of data rich surveying
services including multi-sensors and data analytics to create 3D
mapping and VR imaging. Many of our existing clients are already
showing considerable interest in VR applications, which are at the
forefront of the survey industry's innovation drive and form a
powerful addition to our market leading data capture and processing
capabilities.
2. A leading provider of UAV ("drone") data collection and
monitoring services specialising in over-flying sensitive and
secure installations where sophisticated piloting skills are
required and equally capable on land, in water or in the air.
GyroMetric
In April 2018 the Group made an initial investment to acquire
37% of GyroMetric, which develops and manufactures digital
monitoring and safeguarding systems for rotating shafts. The
GyroMetric technology uses proprietary algorithms, software and AI
techniques to analyse remotely critical drive shaft performance so
as to diagnose and predict drive system maintenance requirements
before catastrophic damage occurs. The company's technology is
proven, operating reliably in harsh environments over many years.
In August 2018, the Group announced a further investment in
GyroMetric, increasing its shareholding to 58%.
The GyroMetric active protection system has been certified for
the marine market by IACS (International Association of
Classification Societies) and ABS (American Bureau of Shipping).
Working with global marine coupling supplier Vulkan GmbH,
GyroMetric has over 60 systems in service which protect large
marine drives and couplings, producing considerable cost savings
for their ship owners.
More recently, GyroMetric has moved into monitoring and
protecting wind turbines, having recently completed highly
successful trials using the world's newest and most powerful
offshore wind turbine drive train test facility at the Offshore
Renewable Energy (ORE) Catapult at Blyth. Working with ORE
Catapult's drivetrain experts, GyroMetric's technology has been
tested to improve the understanding of the behaviour of the
components in use, with a view to increasing the efficiency and
output of wind turbines, whilst reducing the requirement for
unplanned maintenance.
In addition to the company's established Incremental Motion
Encoder (IME) system, GyroMetric has filed a patent application
post year end for a new method of measuring the axial movement of
rotating shafts which matches the reliability achieved by its
digital radial measurement method.
Further applications in other industrial sectors are being
considered as the company works to strengthen its sales and
marketing resources.
The majority investment in Gyrometric provides shareholders with
meaningful participation in a unique technology which is now
demonstrating clear potential to transform remote monitoring of
rotating shafts in a large number of settings globally. The Group's
investment in GyroMetric will continue to be developed through
close operational support and involvement. We believe that
GyroMetric will become a significant component of accretive
shareholder value over the coming months.
The GyroMetric system is able to measure the runout (positioning
error) of bearings to one tenth of a micron (0.0001 mm) at speeds
of up to 20,000 revolutions per minute. The unique ability of the
GyroMetric system to do this reliably over a wide range of speeds
and shaft sizes makes the system applicable to most industrial
applications.
As previously announced, GyroMetric will be conducting trials
for two major wind turbine manufacturers, the first of which is
expected to start shortly, with further material progress and
commercial developments expected in relation to both these
opportunities.
GyroMetric has recently signed a contract for a technical
cooperation with a major UK supplier to the energy and
petrochemical industries to develop applications for GyroMetric's
unique systems. Also, as a result of the recent successful
recruitment of a Technical Sales Director, a number of promising
opportunities in new sectors, where lead times are typically
shorter, are already being pursued.
Although GyroMetric did not generate any revenues in 2018, sales
to new and existing customer have been achieved in 1H 2019 and the
Board remains excited by the opportunities at GyroMetric, both in
the wind industry and in new sectors.
Financial Review
Change of presentational currency to Sterling
The financial statements are presented in Sterling (GBP), which
is considered to be the Group's functional and presentational
currency.
The functional and presentational currency has been changed with
effect from 1 January 2018 from US dollars to Sterling as disclosed
in note 2(f). The change in functional currency reflects the fact
that the Group's training and US activities have been closed and
Geocurve and GyroMetric are now the main trading entities within
the Group. All of Geocurve's contracts are with UK customers and
are invoiced in Sterling. The vast majority of the Group's expenses
are now also in Sterling. Therefore, Sterling is considered to be
the functional currency.
Financial Overview
During the year the Group recorded revenues of GBP857,970
compared with GBP788,718 for the year ended 31 December 2017. The
operating loss for the year ended 31 December 2018 was GBP1,081,879
(year ended 31 December 2017: GBP2,148,774). Administrative
expenses amounted to GBP1,415,446 (year ended 31 December 2017
restated: GBP2,209,385), see table and the bullet points below for
details in relation to the reduction in administrative expenses.
The loss after tax for the year was GBP1,122,834 (year ended 31
December 2017: GBP1,897,479). The loss per share (after
consolidation of the share capital) was 0.35 pence (2017: loss per
share after consolidation of share capital of 1.82 pence).
-- The total revenue figure GBP857,970 for December 2018 relates
to Geocurve, no revenues were generated by GyroMetric during 2018.
In 2017 GBP638,203 was generated by Geocurve and the remaining
GBP150,515 by the closed operations. Geocurve secured a GBP1.1m
contract at the beginning of 2018 to survey the Thames. A
significant investment of manpower was required to get the Thames
project running successfully and efficiently; in Q3 2018 Geocurve
was able to take on new projects alongside the Thames project.
Approximately 80% of the initial phase of the Thames contract was
invoiced in the year ended 31 December 2018
-- Consolidated net assets at 31 December 2018 amounted to
GBP668,683 (31 December 2017: GBP636,315).
-- Cash balances at the year-end amounted to GBP109,381 (2017: GBP502,998).
-- During the year the Company raised GBP744,230 net of costs through the issue of new shares.
-- Operational salaries incurred in Geocurve amounting to
GBP374,446 have been reclassified from administrative expenses to
cost of sales in 2018. A comparative adjustment of GBP359,194 for
2017 has also been made for consistency. The reclassification took
place as a result of a reconsideration of what constituted direct
costs by the new management.
-- Significant administrative cost reductions were achieved in
comparison with 2017, both by reducing costs in the continuing
operations as well as by closing the training and US
businesses:
2017 (restated) Reduction Reduction
2018 (GBP) (GBP) (GBP) (%)
Audit and accountancy fees 52,067 187,620 (135,553) 72%
Plc costs (broker, Nomad, PR
& Marketing) 146,949 220,339 (73,390) 33%
Board costs 157,732 337,158 (179,426) 53%
Other 499,668 441,892 57,776 13%
Sub Total 856,416 1,187,009 (330,593) 28%
Costs of operations closed
in 2018 164,826 587,326
Depreciation & Impairments 394,204 435,050
Total Administrative Expenses
(as per statement of comprehensive
income) 1,393,791 2,209,385
-- The reduction in audit and accountancy fees is due to a new
financial planning and control system implemented during the
period.
-- Depreciation increased to GBP151,670 (2017: GBP61,772) as a
result of additional depreciation following the acquisition of the
Pegasus II equipment by Geocurve at the beginning of March
2018.
-- Impairments of GBP267,266 relates to the release of goodwill
arising from the acquisition of Geocurve in 2015 and GyroMetric in
2018 on a straight-line basis over 5 years.
-- Geocurve became the first company in the UK, and one of only
a few companies in Europe, to acquire a Pegasus II multi-sensor
surveying system which has world leading surveying capabilities and
opens up many business opportunities. The system, with an
acquisition value of GBP0.5m, was acquired on 19 February 2018 from
Academy Leasing Ltd.
-- 67% of the Pegasus II equipment finance was paid during the
year ended December 2018 with the remaining finance to be paid
before the end of 2019. The prompt payment of finance is again part
of the initiative to drive down costs.
-- On 30 April 2018, Remote Monitored Systems granted a total of
100,000,000 options (5,000,000 after consolidation of share
capital) to subscribe for ordinary shares in the Company
("Options") to certain employees. The Options can be exercised in
whole or in part, subject to meeting revenue and profit based
vesting conditions, at any time up to the fifth anniversary of
grant at a price of 0.06p per option (1.2p after consolidation of
share capital), subject to the overriding condition that no Option
may be exercised unless the quoted price of the Company's ordinary
shares is at least 2.0p.
-- In April 2018, the Group announced the acquisition of 36.9%
of the enlarged share capital of GyroMetric for a cash
consideration of GBP250,000. In August 2018, the Group announced a
further investment of GBP273,600 (funded by issuing new share
capital) in GyroMetric increasing the shareholding from 36.9% to
57.8% and thus gained control of the entity. The investment in
GyroMetric provides the Group's shareholders with a stake in a new
and unique technology with promising prospects. The Group's
investment in GyroMetric will continue to be developed through
close operational support and involvement. GyroMetric will be an
important component of growth and shareholder value in the months
and years ahead.
Following the year end, the Group raised GBP350,000 to support
the growth of the Group's core areas of business, to provide
working capital, and to leave the Company free of debt apart from
the remaining payments for the Pegasus equipment. A total of
53,846,154 ordinary shares of 0.2p nominal value each were placed
with investors at 0.65p per share.
Consolidation of share capital
A resolution was passed at the Group's AGM on 29 June 2018 to
consolidate every 20 ordinary shares of 0.01p each in the issued
share capital of Remote Monitored Systems into one ordinary share
of 0.2p each. The EPS calculated as part of the consolidated
statement of comprehensive income reflects the consolidated share
capital and the prior year EPS calculations have been adjusted for
the share consolidation for comparative purposes.
Acknowledgments
On behalf of the Board, I would like to extend our thanks to our
business partners, customers, employees and shareholders for their
continued support throughout the period.
Nigel Burton
Non-Executive Chairman
STRATEGIC REPORT
The Directors present their Strategic Report on the Group for
the year ended 31 December 2018.
Principal activities and business review
The principal activity of Remote Monitored Systems plc (the
"Company") and its subsidiaries (together the "Group") is the
provision of specialist surveys and inspections & developing
and manufacturing digital monitoring and safeguarding systems for
rotating shafts.
The year under review represents the fifth year of trading for
the Group. During 2018 the Group sought to grow via existing
business development. The Group's focus is now centred on growing
the Geocurve business and investing in and providing world leading
technological services with the potential through data and analysis
to revolutionise monitoring and inspection services in high value
and mission critical environments. This will provide the foundation
for subsequent years, the details of which are outlined in the
Chairman's Statement.
Financial review
The Group recorded revenues of GBP857,970 (31 December 2017
(restated): GBP788,718) generating a gross profit of GBP348,450 (31
December 2017 (restated): GBP339,764). The loss for the year to 31
December 2018, after taxation was GBP1,122,834 (31 December 2017
(restated): GBP1,897,479).
Revenues for the year of GBP857,970 were derived from the
Geocurve business (31 December 2017 (restated): GBP638,203 related
to Geocurve and GBP150,515 from closed operations). Administrative
expenses amounted to GBP1,415,446 (31 December 2017 (restated):
GBP2,209,385); a large portion of these costs comprised of wages
and salaries, consultancy and professional fees.
Consolidated net assets at 31 December 2018 amounted to
GBP668,683 (31 December 2017 (restated): GBP636,315). Cash balances
at the year-end amounted to GBP109,381 (31 December 2017
(restated): GBP502,998).
Following the year end, the Group has secured additional finance
to facilitate its development; see Chairman's Statement for more
details. Further details can also be found in Note 29 of the
Financial Statements.
Key performance indicators
Year ended Year ended
31 December 31 December
2018 2017 (restated)
GBP GBP
Revenue 857,970 788,718
Gross profit 348,450 339,764
========================================= ============ ================
Gross margin 40.61% 43.08%
========================================= ============ ================
Administrative expenses 1,408,675 2,209,385
========================================= ============ ================
Loss after tax for the year 1,101,180 1,897,479
========================================= ============ ================
Earnings per share (pence) (0.35) (1.82)
========================================= ============ ================
Net assets 690,337 636,315
========================================= ============ ================
Cash and cash equivalents 109,381 502,998
========================================= ============ ================
Operational salaries incurred in Geocurve amounting to
GBP374,446 have been reclassified from administrative expenses to
cost of sales in 2018. A comparative adjustment of GBP359,194 for
2017 has also been made for consistency. The reclassification took
place because the salary costs are directly attributable to the
supply of services by the entity.
Administrative costs in 2018 were reduced from 2017 with the
majority of savings made by cutting staff and consultancy costs in
non-value-added business areas (see Chairman's Statement).
Current trading and future developments
The Group continues to make progress across all elements of its
business.
Geocurve, having experienced a slower than expected start to
2019, as explained above, has prioritised profitability over
growth. Cost saving measures have been implemented with the
intention of becoming self-financing in 2019, albeit with revenues
expected to be lower than those in 2018.
In April 2018 the Group announced the acquisition of 37% of
GyroMetric, subsequently increasing to 58% through further
investment, which has developed a unique system for reliably
collecting, analysing and monitoring digital data from rotating
shafts over a wide range of speeds and shaft sizes.
GyroMetric which will be conducting trials for two major wind
turbine manufacturers in 2H 2019, has recently signed a contract
for a technical cooperation with a major UK supplier to the energy
and petrochemical industries and as a result of the recent
successful recruitment of a Technical Sales Director, a number of
promising opportunities in new sectors, where lead times are
typically shorter, are already being pursued.
The Group continues to review opportunities for complementary
acquisitions involving data collection and analysis using the
latest available technology including artificial intelligence and
real time reporting using the internet of things.
Principal risks and uncertainties
There are risks associated with the Group's business. The Board
regularly reviews the risks to which the Group is exposed and has
in place a strategy to mitigate these risks as far as possible. The
following summary, which is not exhaustive, outlines some of the
key risks and uncertainties facing the Group at its present stage
of development:
Operating risks
The responsibility of overseeing the day-to-day operations and
the strategic management of the Group depends substantially on its
senior management and its key personnel. There can be no assurance
given that there will be no detrimental impact on the Group if one
or more of these employees cease their employment.
The Group's business planning is carried out on the basis of
expected future work. The Group is reliant upon securing new
contracts. There is a risk that expected contracts will not be won.
The directors mitigate this risk by monitoring the pipeline of
future contracts.
The operations of the Group may be affected by various factors,
including operational and technical difficulties; difficulties in
commissioning and operating plant and equipment; equipment failure
or breakdown and adverse weather conditions which may impact
surveying operations.
Financial risk factors
The Group's activities expose it to a variety of financial
risks: credit risk and liquidity risk. The Group's overall risk
management programme focuses on the unpredictability of financial
markets and seeks to minimise potential adverse effects on the
Group's financial performance.
Credit risk
Credit risk arises from outstanding receivables. Management does
not expect any losses from non- performance of these
receivables.
Liquidity risk
In keeping with similar sized companies, the Group's continued
future operations depend on the ability to raise sufficient working
capital through the issue of equity share capital. At the date of
this report the Group has net cash of approximately GBP25,000 and
therefore the Directors intend to seek to raise additional funding
in the immediate future. The Directors are confident that adequate
funding will be forthcoming with which to finance operations.
Controls over expenditure are carefully managed.
Capital risk management
The Group's objectives when managing capital are to safeguard
the Group's and Company's ability to continue as a going concern,
in order to enable the Group and Company to continue its activities
and bring its products to market. The Company defines capital based
on the total equity of the Company. The Company monitors its level
of cash resources available against future planned activities and
may issue new shares in order to raise further funds from time to
time.
This Strategic Report was approved by the Board of Directors and
authorised for issue on 24 June 2019
by:
Nigel Burton
Chairman and Non-Executive Director
DIRECTORS' REPORT
The Directors present their Report together with the audited
Financial Statements for the year ended 31 December 2018.
General information
The principal activity of Remote Monitored Systems plc (the
"Company") and its subsidiaries (together the "Group") is the
provision of specialist surveys and inspections & developing
and manufacturing digital monitoring and safeguarding systems for
rotating shafts.
Dividends
The Directors do not recommend payment of a dividend (31
December 2017: GBPnil).
Directors' indemnities
The Group has made qualifying third-party indemnity provisions
for the benefit of its Directors which were made during the year
and remain in force at the date of this report.
Directors' interests
The Directors who held office in the year up to the date of
approval of these Financial Statements and their beneficial
interests in the Company's issued share capital at the beginning
and end of the accounting year were:
Ordinary Ordinary
Shares Shares Warrants Warrants
Interest at Interest at Interest at Interest
31 December at 31 December
2018 2017 (consolidated)
31 December 31 December (consolidated)
2018 2017
(consolidated) (consolidated)
No. No. No. No.
Graham Peck (1) 333,477 333,477 - -
Iain McLure (2) 7,142,857 7,142,857 5,000,000 5,000,000
Gerard Dempsey (3) - 1,278,000 1,250,000 1,250,000
Paul Ryan (4) 16,963,388 16,963,388 5,500,000 5,500,000
Trevor Brown 42,857,143 42,857,143 - 21,428,571
Nigel Burton(5) 10,714,286 - - -
1. Includes 50,000 shares held by the wife of Graham Peck. Resigned 29 January 2018
2. Includes 2,142,857 ordinary shares held by Scotnl Consulting
B.V., a company controlled by Mr McLure Resigned 29 January
2018
3. Resigned 12 January 2018
4. Shares held by Warande1970 BVBA, a company controlled by Mr Ryan
5. Appointed 12 January 2018
Major shareholdings
The closing mid-market price of the Company's Ordinary 0.2p
Shares at 31 December 2018 was 0.73p. Shareholders holding more
than 3% of the Company's shares at the date of this report
were:
Ordinary shares %
-------------------- ---------------- ------
Trevor Brown 88,241,757 22.8
Stephen Paul Jones 51,904,885 13.4
Nigel Burton 26,098,900 6.8
Paul Ryan 16,963,388 4.4
Capital structure
Details of the issued share capital, together with details of
the movements in the Company's issued share capital during the
year, are shown in note 19. Since 31 December 2018 the Company has
raised additional capital as set out below. Further information is
set out in note 29 to the Financial Statements.
The holders of Ordinary Shares are entitled to receive notice
of, and to attend and vote at, any General Meeting of the Company.
Every member present at such a meeting shall, upon a show of hands,
have one vote. Upon a poll, holders of all shares shall have one
vote for every share held. All Ordinary Shares are entitled to
participate in any distributions of the Company's profits or
assets. There are no restrictions on the transfer of the Company's
Ordinary Shares. Remote Monitored Systems plc's ordinary 0.2p
shares are traded solely on the AIM market.
The Company also has Deferred Shares in issue, the holders of
which are not entitled to vote at General Meetings and have no
entitlement to distributions.
Going concern
The Financial Statements have been prepared assuming the Group
and Company will continue as a going concern. As at 31 May 2019,
the group had cash and cash equivalents totalling GBP48,360.
The operational requirements of the Group comprise of
maintaining a Head Office in the UK alongside its UK operations.
The Directors have reviewed the Group's working capital forecasts,
as stated in the Strategic Report, Geocurve is expected to be
self-funding in 2019. In line with the agreed plan and budget,
GyroMetric requires additional investment to achieve sales
growth.
At the date of this report the Group had net cash of
approximately GBP25,000 and therefore the Directors intend to seek
to raise additional funding in the immediate future. The ability of
the Company to raise additional funds is dependent upon investor
appetite and, if necessary, the Directors' ability to obtain
alternative sources of funding.
The Directors have a reasonable expectation that the Company
will be able to raise sufficient funding to allow it to cover its
working capital for a period of twelve months from the date of
approval of the financial statements. It is for this reason they
continue to adopt the going concern basis of accounting in
preparing the financial statements Note 2(b). The Auditors make
reference to going concern by way of a material uncertainty within
the financial statements.
Matters covered in the Strategic Report
The Business Review, results, review of KPIs and details of
future developments are included in the Strategic Report and
Chairman's Statement.
Events after the reporting year
On 17 January 2019 the Company issued 53,846,154 new ordinary
shares of 0.2p each at a price of 0.65p per share raising
GBP350,000. Certain directors took part in the placing, subscribing
to 15,384,615 shares each.
EU Referendum
The main trading entities, Geocurve and GyroMetric, operate in
the UK and Europe. It is not yet clear if or when the UK will leave
the EU nor what impact this may have on the Group. Turnover to the
Rest of the EU is currently GBPnil, but a small proportion of
GyroMetric's sales leads are in Continental Europe. The hesitancy
of some customers to spend money before the final Brexit decision
is made has had an impact on the growth of both Geocurve and
GyroMetric. The Directors will continue to monitor the situation
closely and act accordingly.
Disclosure of information to auditor
Each of the persons who is a Director at the date of approval of
this annual report confirms that:
i) so far as each Director is aware, there is no relevant audit
information of which the Company's auditor is unaware; and
ii) the Directors have taken all the steps that they 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.
Independent auditor
The auditor, PKF Littlejohn LLP, will be proposed for
reappointment in accordance with section 485 of the Companies Act
2006 at the annual general meeting.
PKF Littlejohn LLP has expressed a willingness to continue in
office as auditor.
By Order of the Board
Nigel Burton
Chairman and Non-Executive Director
24 June 2019
DIRECTORS' RESPONSIBILITIES STATEMENT
The Directors are responsible for preparing the Annual Report
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 prepared the Group and Parent Company Financial Statements in
accordance with International Financial Reporting Standards (IFRSs)
as adopted by the European Union. 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
Group and the Parent Company and of the profit or loss of the Group
and Parent Company for that year.
In preparing these Financial Statements, the Directors are
required to:
-- select suitable accounting policies and then apply them consistently;
-- make judgements and accounting estimates that are reasonable and prudent;
-- state whether applicable IFRSs as adopted by the European
Union have been followed, subject to any material departures
disclosed and explained in the financial statements; and
-- prepare the financial statements on a going concern basis
unless it is inappropriate to presume that the Group and Parent
company will continue in business.
The Directors are responsible for keeping adequate accounting
records that are sufficient to show and explain the Group and
Parent company's transactions and disclose with reasonable accuracy
at any time the financial position of the Group and the Parent
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 the group 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.
The Company is compliant with the AIM Rule 26 regarding the
Company's website.
By Order of the Board
Nigel Burton
Chairman and Non-Executive Director
24 June 2019
CORPORATE GOVERNANCE STATEMENT
As at 31 December 2018
From 28 September 2018 as an AIM company, the Company has been
required to maintain on its website details of a recognised
corporate governance code, how the Company complies with this code
and an explanation of any departure from the code. The information
needs to be reviewed annually and the website should include the
date on which the information was last reviewed. This review has
been undertaken during the process of preparing the Annual Report
and Financial Statements. The Directors set out below RMS's
Corporate Governance Report.
The Directors recognise the importance of sound corporate
governance. As a company whose shares are traded on AIM, the Board
seeks to comply with the Quoted Companies Alliance's Corporate
Governance Code ("the QCA Code"). In addition, the Directors have
adopted a code of conduct for dealings in the shares of the Company
by directors and employees and are committed to maintaining the
highest standards of corporate governance. Paul Ryan, in his
capacity as Non-Executive Director, has assumed responsibility for
ensuring that the Company has appropriate corporate governance
standards in place and that these requirements are followed and
applied within the Company as a whole. The corporate governance
arrangements that the Board has adopted are designed to ensure that
the Company delivers long term value to its shareholders and that
shareholders have the opportunity to express their views and
expectations for the Company in a manner that encourages open
dialogue with the Board. The Board recognises that its decisions
regarding strategy and risk will impact the corporate culture of
the Company as a whole and that this will impact the performance of
the Company. The Board is very aware that the tone and culture set
by the Board will greatly impact all aspects of the Company as a
whole and the way that employees behave. A large part of the
Company's activities is centred upon what needs to be an open and
respectful dialogue with employees, clients and other stakeholders.
Therefore, the importance of sound ethical values and behaviours is
crucial to the ability of the Company successfully to achieve its
corporate objectives. The Board places great importance on this
aspect of corporate life and seeks to ensure that this flows
through all that the Company does.
The key governance related matters that occurred during the
financial year ended 31 December 2018 were the retirement of Graham
Peck, Iain McLure and Gerard Dempsey as directors of the Company
and from all their positions within the Company, and the
appointment of Dr Nigel Burton to the Board as Non-Executive
Director in January 2018.
Corporate Governance Report
The QCA Code sets out 10 principles that should be applied.
These are listed below together with a short explanation of how the
Company applies each of the principles:
Principle One
Business Model and Strategy
The Board has concluded that the highest medium and long term
value can be delivered to its shareholders by the adoption of a
single strategy for the Company. The Company's interests in both
Geocurve and GyroMetric are active and strategic investments and
these are both companies where the Company continues to hold
significant stakes, where we remain actively involved with the
development of the company with, the Company being represented on
the board of the entities and where we believe that the returns
that are possible are material. The Company will continue to seek
to grow both businesses organically and will seek out further
complementary acquisitions that create enhanced value.
Principle Two
Understanding Shareholder Needs and Expectations
The Board is committed to maintaining good communication and
having constructive dialogue with its shareholders. The Company has
close ongoing relationships with its private shareholders.
Institutional shareholders and analysts have the opportunity to
discuss issues and provide feedback at meetings with the Company.
In addition, all shareholders are encouraged to attend the
Company's Annual General Meeting. Investors also have access to
current information on the Company though its website,
www.remotemonitoredsystems.com, and via Trevor Brown, CEO who is
available to answer investor relations enquiries.
Principle Three
Considering wider stakeholder and social responsibilities
The Board recognises that the longterm success of the Company is
reliant upon the efforts of the employees of the Company and its
contractors, suppliers, regulators and other stakeholders. The
Board has put in place a range of processes and systems to ensure
that there is close oversight and contact with its key resources
and relationships. For example, all employees of the Company
participate in a structured Company-wide annual assessment process
which is designed to ensure that there is an open and confidential
dialogue with each person in the Company to help ensure successful
twoway communication with agreement on goals, targets and
aspirations of the employee and the Company. These feedback
processes help to ensure that the Company can respond to new issues
and opportunities that arise to further the success of employees
and the Company. The Company has close ongoing relationships with a
broad range of its stakeholders and provides them with the
opportunity to raise issues and provide feedback to the
Company.
Principle Four
Risk Management
In addition to its other roles and responsibilities, the Audit
and Compliance Committee is responsible to the Board for ensuring
that procedures are in place and are being implemented effectively
to identify, evaluate and manage the significant risks faced by the
Company. The risk assessment matrix below sets out those risks, and
identifies their ownership and the controls that are in place. This
matrix is updated as changes arise in the nature of risks or the
controls that are implemented to mitigate them. The Audit and
Compliance Committee reviews the risk matrix and the effectiveness
of scenario testing on a regular basis. The following principal
risks and controls to mitigate them, have been identified:
Activity Risk Impact Control(s)
========================= =========================
Management Recruitment and Reduction in operating Stimulating and
retention of key capability safe working environment
staff Balancing salary
with longer term
incentive plans
=========== ========================= ========================= ==========================
Regulatory Breach of rules Censure or withdrawal Strong compliance
adherence of authorisation regime instilled
at all levels of
the Company
=========== ========================= ========================= ==========================
Strategic Damage to reputation Inability to secure Effective communications
new capital or with shareholders
clients coupled with consistent
messaging to our
Inadequate disaster customers
recovery procedures Loss of key operational Robust compliance
and financial Secure off-site
data storage of data
=========== ========================= ========================= ==========================
Financial Liquidity, market Inability to continue Robust capital
and credit risk as going concern management policies
Reduction in asset and procedures
Inappropriate values Appropriate authority
controls and accounting Incorrect reporting and investment
policies of assets levels as set by
Treasury and Investment
Policies
Audit and Compliance
Committee
=========== ========================= ========================= ==========================
The Directors have established procedures, as represented by
this statement, for the purpose of providing a system of internal
control. An internal audit function is not considered necessary or
practical due to the size of the Company and the close day to day
control exercised by the executive directors. However, the Board
will continue to monitor the need for an internal audit function.
The Board works closely with and has regular ongoing dialogue with
the Company financial controller and has established appropriate
reporting and control mechanisms to ensure the effectiveness of its
control systems.
Principle Five
A Well Functioning Board of Directors
As at the date hereof the Board comprised, the CEO Trevor Brown,
and two Non-Executive Directors, Dr Nigel Burton and Paul Ryan.
Biographical details of the current Directors are set out within
Principle Six below. Executive and Non-Executive Directors are
subject to re-election at intervals of no more than three years.
The letters of appointment of all Directors are available for
inspection at the Company's registered office during normal
business hours. All the Directors including the Non-Executive
Directors are considered to be part time but are expected to
provide as much time to the Company as is required.
The Board meets at least eight times per annum. It has
established an Audit and Compliance Committee and a Remuneration
Committee, particulars of which appear hereafter. The Board has
agreed that appointments to the Board are made by the Board as a
whole and so has not created a Nominations Committee. Both the CEO
and the Non-Executive Directors are considered to be part time but
are expected to provide as much time to the Company as is required.
The Board considers that this is appropriate given the Company's
current stage of operations. It shall continue to monitor the need
to match resources to its operational performance and costs and the
matter will be kept under review going forward. The Board notes
that the QCA recommends a balance between executive and
non-executive Directors and recommends that there be two
independent non-executives. Paul Ryan and Nigel Burton are
considered to be Independent Directors. The Board shall review
further appointments as scale and complexity grows.
Attendance at Board and Committee Meetings
The Company shall report annually on the number of Board and
committee meetings held during the year and the attendance record
of individual Directors. To date in the current financial year the
Directors have a 100% record of attendance at such meetings. In
order to be efficient, the Directors meet formally and informally
both in person and by telephone. During the year there were 8 Board
meetings, with all directors being present at all meetings. The
volume and frequency of such meetings is expected to continue at a
similar rate. The Audit and Compliance Committee met three times
and the Remuneration Committee, met twice, in each case with all
members present.
Principle Six
Appropriate Skills and Experience of the Directors
The Board currently consists of three Directors and, in
addition, the Company has contracted the outsourced services of MSP
Secretaries Limited to act as the Company Secretary. The Company
believes that the current balance of skills in the Board as a
whole, reflects a very broad range of commercial and professional
skills across geographies and industries and each of the Director's
has experience in public markets.As demonstrated below in the
descriptions of each Director, the Board has the necessary
commercial, financial and legal skills required for the effective
leadership of the Group.
The Board recognises that it currently has a limited diversity
and this will form a part of any future recruitment consideration
if the Board concludes that replacement or additional directors are
required.
Each Director undertakes a mixture of formal and informal
continuing professional development as necessary to ensure that
their skills remain current and relevant to the needs of the
Group.
Trevor E Brown MBA
Chief Executive Officer
Trevor has acted as a CEO, executive director and non-executive
director for a wide range of companies in a range of sectors over
50 years. This has provided him with a vast amount of experience
through the many long term economic and corporate life cycles that
mean he is highly qualified to assess the opportunities and risks
for both the Company and its portfolio of investee companies. This
wide ranging experience is kept up to date through his continued
participation in a variety of businesses where the Company has a
holding and in other companies that are unconnected to the Company.
Trevor is also a member of the Company's Remuneration Committee.
Trevor is also currently a director of Flying Brands plc and a
Non-executive Director of Braveheart Investment Company plc. Trevor
joined the Board as an Executive Director in December 2017 and
became the Chief Executive Officer in January 2018.
Dr Nigel Burton
Chairman and Non-Executive Director
Dr Nigel Burton has over 30 years' experience in operational and
financial management, debt and equity financing, acquisition and
integration of businesses, disposals, IPOs and trade sales.
Following over 14 years as an investment banker at leading City
institutions including UBS Warburg and Deutsche Bank, including as
the Managing Director responsible for the energy and utilities
industries, Nigel has spent 15 years as Chief Financial Officer of
a number of private and public companies, including Navig8 Product
Tankers Inc, PetroSaudi Oil Services Limited, Advanced Power AG,
and Granby Oil and Gas plc. Nigel is currently Non-Executive
Chairman of AIM-listed Regency Mines plc and a Non-Executive
Director of AIM-listed Digitalbox plc and Tau Capital plc, and was
Chief Executive Officer of Nu-Oil and Gas plc until January 2019.
Nigel is a Chartered Electrical Engineer and a Past President of
the Institution of Engineering and Technology. He has a B.Sc.
(First Class Hons) in Electrical and Electronic Engineering and a
Ph.D in Acoustic Imaging from University College London.
Mr Paul Ryan
Independent Non-Executive Director
Mr Ryan has over 20 years' experience at board level largely in
the telecoms and ICT sectors. From 2002 to 2013, he held a variety
of board positions with leading mobile operator Vodafone and its
operating subsidiaries, including Head of Strategy, Regulatory and
Political Affairs in Brussels and Director of Strategy and External
Affairs for Vodafone Ireland and Vodafone Ghana. Prior to this, he
worked as a management consultant in the European telecoms sector,
served as a strategic adviser at Ofcom, the UK's communications
industry regulator, and was a solicitor at leading international
City law firm Ashurst. Mr Ryan acts as an adviser, primarily on
strategy, regulation and public policy, to a range of clients
including FTSE100 and Fortune 500 companies largely in the ICT
space. Mr Ryan has an LLB from Trinity College, Dublin, Ireland and
qualified as a solicitor in the UK.
Principle Seven
Evaluation of Board Performance
The Board has undertaken an internal review of the Board, the
Committees and individual Directors, in the form of peer appraisal
and discussions, to determine their effectiveness and performance
as well as the Directors' continued independence.
The evaluation concluded that the Board demonstrates the
appropriate level of skills, knowledge and performance for the size
and nature of the Group. The Directors will continue to review the
need to strengthen the Board as the Group develops.
Principle Eight
Corporate Culture
The Board recognises that its decisions regarding strategy and
risk will impact the corporate culture of the Company as a whole
and that this will impact the performance of the Company. The
corporate governance arrangements that the Board has adopted are
designed to ensure that the Company delivers long term value to its
shareholders and that shareholders have the opportunity to express
their views and expectations for the Company in a manner that
encourages open dialogue with the Board. The Board recognises that
their decisions regarding strategy and risk will impact the
corporate culture of the Company as a whole and that this will
impact the performance of the Company. The Board is very aware that
the tone and culture set by the Board will greatly impact all
aspects of the Company as a whole and the way that employees
behave. A large part of the Company's activities is centred upon
what needs to be an open and respectful dialogue with employees,
clients and other stakeholders. Therefore, the importance of sound
ethical values and behaviours is crucial to the ability of the
Company to successfully achieve its corporate objectives.
The Board places great import on this aspect of corporate life
and seeks to ensure that this flows through all that the Company
does. The Directors consider that at present the Company has an
open culture facilitating comprehensive dialogue and feedback and
enabling positive and constructive challenge. There is frequent
dialogue between the Directors and senior management at both
Geocurve and GyroMetric. The Board monitors the corporate culture
through a mix of formal and informal feedback, based on which the
Board is confident that a healthy culture consistent with the
principles adopted exists.
The Company has adopted, with effect from the date on which its
shares were admitted to AIM, a code for Directors' and employees'
dealings in securities which is appropriate for a company whose
securities are traded on AIM and is in accordance with the
requirements of the Market Abuse Regulation which came into effect
in 2016.
Principle Nine
Maintenance of Governance Structures and Processes
Ultimate authority for all aspects of the Company's activities
rests with the Board, the respective responsibilities of the
Chairman and Chief Executive Officer arising as a consequence of
delegation by the Board. The Board has adopted appropriate
delegations of authority which set out matters which are reserved
to the Board. The Chairman is responsible for the effectiveness of
the Board, while management of the Company's business and primary
contact with shareholders has been delegated by the Board to the
Chief Executive Officer.
Audit and Compliance Committee
During the financial year ended 31 December 2017 the Audit and
Compliance Committee was chaired by Paul Ryan. Since his
appointment in January 2018 Dr Nigel Burton joined Mr Ryan on the
Committee. This committee has primary responsibility for monitoring
the quality of internal controls and ensuring that the financial
performance of the Company is properly measured and reported. It
receives reports from the executive management and auditors
relating to the interim and annual accounts and the accounting and
internal control systems in use throughout the Company. The Audit
and Compliance Committee shall meet not less than twice in each
financial year and it has unrestricted access to the Company's
auditors.
Remuneration Committee
The Remuneration Committee comprises Paul Ryan and Trevor Brown,
and Paul Ryan chairs this committee. The Remuneration Committee
reviews the performance of the executive directors and employees
and makes recommendations to the Board on matters relating to their
remuneration and terms of employment. The Remuneration Committee
also considers and approves the granting of share options pursuant
to the share option plan and the award of shares in lieu of bonuses
pursuant to the Company's Remuneration Policy.
Nominations Committee
The Board has agreed that appointments to the Board will be made
by the Board as a whole and so has not created a Nominations
Committee.
Non-Executive Directors
The Board has adopted guidelines for the appointment of
Non-Executive Directors which have been in place and which have
been observed throughout the year. These provide for the orderly
and constructive succession and rotation of the Chairman and
non-executive directors insofar as both the Chairman and
non-executive directors will be appointed for an initial term of
three years and may, at the Board's discretion believing it to be
in the best interests of the Company, be appointed for subsequent
terms. The Chairman may serve as a Non-Executive Director before
commencing a first term as Chairman.
In accordance with the Companies Act 2006, the Board complies
with: a duty to act within their powers; a duty to promote the
success of the Company; a duty to exercise independent judgement; a
duty to exercise reasonable care, skill and diligence; a duty to
avoid conflicts of interest; a duty not to accept benefits from
third parties and a duty to declare any interest in a proposed
transaction or arrangement.
Principle Ten
Shareholder Communication
The Board is committed to maintaining good communication and
having constructive dialogue with its shareholders. The Company
responds to all shareholders who contact the Directors, and as a
result has positive ongoing relationships with a wide range of
shareholders. All shareholders and analysts have the opportunity to
discuss issues and provide feedback at meetings with the Company.
The Company also provides shareholder updates whenever appropriate
using both regulatory and other channels including video interviews
on Proactive Investors. In addition, all shareholders are
encouraged to attend the Company's Annual General Meeting.
Investors also have access to current information on the Company
though its website, www.remotemonitored systems.com, and via Trevor
Brown, CEO, who is available to answer investor relations
enquiries.
The Company agreed in 2018to move to electronic communications
with shareholders in order to maximise efficiency. Paper
communications will be maintained for the small number of
shareholders who have specifically requested this.
The Company includes, when relevant, in its annual report, any
matters of note arising from the audit or remuneration
committees.
Paul Ryan
Non-Executive Director
24 June 2019
AUDIT COMMITTEE REPORT
An important part of the role of the Audit Committee is its
responsibility for reviewing the effectiveness of the Group's
financial reporting, internal control policies, and procedures for
the identification, assessment and reporting of risk. The Committee
devotes significant time to their review and further information on
the risk management and internal control systems is provided within
the Strategic Report.
A key governance requirement of the Group's financial statements
is for the report and accounts to be fair, balanced and
understandable. The co-ordination and review of the Group-wide
input into the Annual Report and Accounts is a sizeable exercise
performed within an exacting time-frame. It runs alongside the
formal audit process undertaken by external Auditors and is
designed to arrive at a position where initially the Audit
Committee, and then the Board, is satisfied with the overall
fairness, balance and clarity of the document is underpinned by the
following:
-- detailed guidance issued to contributors at operational levels;
-- a verification process dealing with the factual content of the reports;
-- thorough review undertaken at different levels that aim to
ensure consistency and overall balance; and
-- comprehensive review by the senior management team.
An essential part of the integrity of the financial statements
are the key assumptions and estimates or judgements that have to be
made. The Committee reviews key judgements prior to publication of
the financial statements at the full and half year, as well as
considering significant issues throughout the year. In particular,
this includes reviewing any materially subjective assumptions
within the Group's activities. The Committee reviewed and was
satisfied that the judgements exercised by management on material
items contained within the Annual Report were reasonable.
The Committee also considered management's assessment of going
concern with respect to the Group's cash position and its
commitments for the next 12 months. In this respect, the Committee
refers to the Going concern section in the Directors' Report.
The Audit Committee has considered the Group's internal control
and risk management policies and systems, their effectiveness and
the requirements for an internal audit function in the context of
the Group's overall risk management system. The Committee is
satisfied that the Group does not currently require an internal
audit function.
The Committee has recommended to the Board that shareholders
support the re-appointment of the Auditors at the 2019 AGM.
Paul Ryan
Chairman of the Audit Committee
24 June 2019
REMUNERATION COMMITTEE REPORT
The Remuneration Committee ("Committee") convened twice during
the year and has been engaged on all matters of corporate
remuneration. Over the past year, the Committee has considered the
following matters:
-- Director remuneration;
-- Senior Management remuneration and incentives including options
In order to conserve the Company's working capital the Directors
have deferred part of their remuneration and in 2019 consideration
will be given to whether it would be appropriate to take a portion
of their remuneration in shares or warrants.
Options were awarded to a number of senior employees in May
2018.
The Committee, when reviewing remuneration, consider matters of
retention, motivation, the economic climate, and the challenges
facing the business and the wider sector; they also consider
appropriate industry benchmarks. The annual remuneration for the
Directors is noted in the Directors' report.
Paul Ryan
Chairman, Remuneration Committee
25 June 2019
INDEPENT AUDITOR'S REPORT
For the year ended 31 December 2018
INDEPENT AUDITOR'S REPORT TO THE MEMBERS OF REMOTE MONITORED
SYSTEMS PLC
Opinion
We have audited the financial statements of Remote Monitored
Systems Plc (the 'parent company') and its subsidiaries (the
'group') for the year ended 31 December 2018 which comprise the
Consolidated Statement of Comprehensive Income, the Consolidated
and Parent Company Statements of Financial Position, the
Consolidated and Parent Company Statements of Changes in Equity,
the Consolidated and Parent Company Statements of Cash Flow and
notes to the financial statements, including a summary of
significant accounting policies. The financial reporting framework
that has been applied in their preparation is applicable law and
International Financial Reporting Standards (IFRSs) as adopted by
the European Union and as regards the parent company financial
statements, as applied in accordance with the provisions of the
Companies Act 2006.
In our opinion:
-- the financial statements give a true and fair view of the
state of the group's and of the parent company's affairs as at 31
December 2018 and of the group's and parent company's loss for the
year then ended;
-- the group financial statements have been properly prepared in
accordance with IFRSs as adopted by the European Union;
-- the parent company financial statements have been properly
prepared in accordance with IFRSs as adopted by the European Union
and as applied in accordance with the provisions of the Companies
Act 2006; and
-- the financial statements 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 group
and parent 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 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.
Material uncertainty in relation to going concern
We draw attention to note 2(b) in the financial statements,
which indicates that the Group incurred a net loss of GBP1,019,242
during the year ended 31 December 2018 and at that date, the Group
held net assets of GBP806,578.
The Financial Statements have been prepared on the going concern
basis, which depends on the timing of new customer contracts and
the receipt of new funds. As stated, these events or conditions,
along with other matters as set forth in note 2(b), indicate that a
material uncertainty exists that may cast significant doubt on the
Group's and Company's ability to continue as a going concern. Our
opinion is not modified in respect of this matter.
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. Materiality for the
consolidated financial statements was set as GBP33,000 based upon
gross assets. Materiality for the parent company financial
statements was also GBP33,000 with the same benchmark being
used.
Gross assets were considered to be a key benchmark as the most
significant balances for the Group are the intangible assets, PPE
and trade receivable balances. As a result, gross assets are deemed
to be the most suitable basis for materiality. The Group is still
in the growth stage of its lifecycle and therefore revenue and PBT
were not deemed to be suitable.
An overview of the scope of our audit
In designing our audit, we determined materiality and assessed
the risk of material misstatement in the financial statements. In
particular, we looked at areas involving significant accounting
estimates and judgement by the directors and considered future
events that are inherently uncertain. We also addressed the risk of
management override of internal controls, including evaluating
whether there was evidence of bias by the directors that
represented a risk of material misstatement due to fraud. The
Company and Group finance function is based from one location in
the United Kingdom. All material subsidiaries were within our audit
scope and audited at this location.
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 the scope of our audit responded
to the key audit matter
Impairment of Intangible assets
=============================================================
The Group carries a material Our work included but was not
amount of intangible assets restricted to:
(GBP801,111) that have arisen * Reviewing and challenging management's value in use
from business combinations. calculations including the rationale behind any
There is a risk that the intangible inputs used;
assets are impaired and are
overstated within the financial
statements. * Considering management's strategy including all
notifications made to the market concerning business
lines that have been discontinued;
* Discussing and challenging the basis of key
assumptions with management, in particular, regarding
revenue, margins and cashflow forecasts;
* Performing sensitivity analysis on changes in key
assumptions;
* Considering internal and external impairment
indicators; and
* Assessed the accuracy of managed budgets and
forecasts used in prior calculations.
=============================================================
Revenue Recognition
=============================================================
Historically the Group has Our work included but was not
incurred revenue across a variety restricted to:
of income streams. In 2018
the Group focused on providing * Updating our understanding of the internal control
contract specific surveying environment in operation for the significant revenue
services. stream and undertaking a walk-through to ensure that
2018 is the first year that the key controls within these systems have been
the Group will have adopted operating in the period under audit;
IFRS 15 "Revenue from Contracts
with Customers".
There is the risk that the * Substantive transactional testing of revenue
revenue has been recognised recognised in the Financial Statements;
incorrectly.
* Reviewing the key contractual terms and terms of
business with customers to identify the material
performance obligations;
* A review of managements workings and assessment of
the impact on IFRS 15 on the Group's financial
statement as well as reviewing all related
disclosures; and
* A review of post-year end invoices, credit notes and
cash receipts to ensure completeness of income
recorded in the accounting period.
=============================================================
Valuation and impairment of
investments
=============================================================
The carrying value of investments Our work included but was not
in subsidiaries was (GBP1,478,494) restricted to:
in the parent company financial * Verifying the ownership of investments held;
statements.
The recoverability value of
the investments is reliant * Discussing with management the basis for impairment
upon the subsidiary undertakings or non-impairment, including consideration of
being able to generate sufficient business strategy for the subsidiaries, and
returns from their activities challenging any assumptions made thereon;
to support their carrying value.
* Obtaining management prepared value-in-use
calculations for subsidiaries and assessing the
mathematical accuracy of the calculations and the
reasonableness of all key inputs used; and
* Reviewing the impairment indicators per IFRS and
assessing how management applied to these to the
investments held.
=============================================================
The acquisition of GyroMetric
Systems Limited ("GyroMetric")
=============================================================
The Company initially gained Our work included;
significant influence in GyroMetric * Verification of ownership for each stage of the
through acquiring 36.9% of acquisition and confirmation of control being
the share capital in April obtained;
2018 and then increasing its
stake to 57.8% of the share
capital and thereby gaining * Obtaining management's calculation of the fair value
control in August 2018. of net assets at acquisition and challenging
The acquisition is classified management's assumptions and judgements thereon;
as a step acquisition per IFRS
and was settled through the
issuance of shares and convertible * Reviewing and challenging management's calculation of
loan notes. goodwill and any Intangible Assets arising on
There is the risk that the acquisition to ensure they meet the requirements of
acquisition has not been accounted IFRS 3; and
for correctly and the required
disclosures have not been made
within the financial statements. * Reviewing the disclosures made in the financial
statements and ensuring they meet the requirement of
IFRS 3.
=============================================================
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. Our opinion on the group and parent company
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. In
connection with our audit of the financial statements, 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
audit or otherwise appears to be materially misstated. If we
identify such material inconsistencies or apparent material
misstatements, we are required to determine whether there is a
material misstatement in the financial statements or a material
misstatement of the other information. 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, 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 year 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 group and
the parent company and their 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 by the parent
company, or returns adequate for our audit have not been received
from branches not visited by us; or
-- the parent company financial statements 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 directors' responsibilities
statement, the directors are responsible for the preparation of the
group and parent company 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 group and parent company financial statements,
the directors are responsible for assessing the group's and the
parent 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 group or the parent 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.
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.
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.
Joseph Archer (Senior Statutory Auditor) 1 Westferry Circus
For and on behalf of PKF Littlejohn LLP Canary Wharf
Statutory Auditor London E14 4HD
24 June 2019
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME Year
For the year ended 31 December 2018 Year ended
ended 2017
2018 Restated
Continuing operations Note GBP GBP
------------------------------------------------- ---- ----------- -----------
Revenue 5 857,970 788,718
Cost of sales (509,520) (448,954)
------------------------------------------------- ---- ----------- -----------
Gross profit 348,450 339,764
Administrative expenses 6 (1,148,180) (2,209,385)
Other income 7,371 23,494
(Loss)/gain on foreign exchange 6 (2,754) 14,426
Impairment 6 (245,612) (155,796)
Share option charge 21 (19,500) (161,277)
------------------------------------------------- ---- ----------- -----------
Operating loss (1,060,225) (2,148,774)
Finance costs 10 (4,216) (77,238)
Finance income 7 12
Loss on change of ownership interests (42,273) -
Loss before income tax (1,106,707) (2,226,000)
Income tax credit 11 5,527 328,521
------------------------------------------------- ---- ----------- -----------
Loss for the year (1,101,180) (1,897,479)
------------------------------------------------- ---- ----------- -----------
Other Comprehensive Income
Items that may be subsequently reclassified
to profit or loss:
Currency translation differences 47,547 96,004
------------------------------------------------- ---- ----------- -----------
Total comprehensive income for the year, net
of tax (1,053,633) (1,801,475)
------------------------------------------------- ---- ----------- -----------
Loss attributable to:
Equity holders of the parent (1,062,433) (1,897,479)
Non-controlling interests (38,747) -
Total comprehensive income attributable to:
Equity holders of the parent (1,014,886) (1,801,475)
Non-controlling interests (38,747) -
Earnings per ordinary share attributable to
owners of the parent during the year (expressed
in pence per share)
Basic and diluted 12 (0.35) (1.82)
------------------------------------------------- ---- ----------- -----------
The loss for the financial year dealt with in the financial
statements of the Parent Company, Remote Monitored Systems plc, was
GBP830,171 (2017: loss of GBP2,897,118). As permitted by Section
408 of the Companies Act 2006, no separate statement of
comprehensive income is presented in respect of the Parent
Company.
The notes form part of these Financial Statements.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 31 December 2018
2017 2016
2018 Restated Restated
Note GBP GBP GBP
-------------------------------- ----- -------------- ----------- -----------
Non-current assets
Intangible assets 13 822,765 674,654 1,131,918
Property, plant and equipment 14 504,488 88,291 145,257
-------------------------------- ----- -------------- ----------- -----------
Total non-current assets 1,327,253 762,945 1,277,175
-------------------------------- ----- -------------- ----------- -----------
Current Assets
Trade and other receivables 17 254,531 187,633 170,440
Corporation tax 300 146,347 -
Inventories 18,090 - -
Cash and cash equivalents 18 109,381 502,998 2,318
-------------------------------- ----- -------------- ----------- -----------
Total current assets 382,302 836,978 172,758
-------------------------------- ----- -------------- ----------- -----------
Total assets 1,709,555 1,599,923 1,449,933
-------------------------------- ----- -------------- ----------- -----------
Equity attributable to owners
of the parent
Share capital 19 4,791,747 4,512,087 2,743,240
Share premium 19 6,330,629 5,583,109 4,790,405
Other reserves 21 (298,454) (253,109) (414,386)
Translation reserve 92,181 44,634 (51,370)
Retained loss (10,247,994) (9,250,406) (7,352,927)
-------------------------------- ----- -------------- ----------- -----------
equity ATTRIBUTABLE TO OWNERS
OF THE PARENT 668,109 636,315 (285,038)
Non-controlling interests 22,228 - -
TOTAL EQUITY 690,337 636,315 (285,038)
-------------------------------- ----- -------------- ----------- -----------
Current liabilities
Trade and other payables 22 404,262 517,233 894,942
Social security and other taxes 235,650 192,855 178,230
Borrowings 23 166,666 117,807 80,000
-------------------------------- ----- -------------- ----------- -----------
Total current liabilities 806,578 827,895 1,153,172
-------------------------------- ----- -------------- ----------- -----------
Non-current liabilities
Other payables 6,312 - -
Borrowings 23 - - 338,485
Deferred tax liabilities 24 206,328 135,712 243,314
-------------------------------- ----- -------------- ----------- -----------
Total non-current liabilities 212,640 135,712 581,799
-------------------------------- ----- -------------- ----------- -----------
TOTAL LIABILITIES 1,019,218 963,607 1,734,970
-------------------------------- ----- -------------- ----------- -----------
TOTAL EQUITY AND LIABILTIES 1,709,555 1,599,923 1,449,933
-------------------------------- ----- -------------- ----------- -----------
The notes form part of these Financial Statements.
These Financial Statements were approved by the Board of
Directors and authorised for issue on 24 June 2019 and were signed
on its behalf by:
Nigel Burton
Non-Executive Director
PARENT COMPANY STATEMENT OF FINANCIAL POSITION
As at 31 December 2018
Company number: 09109008
2017 2016
2018 Restated Restated
Note GBP GBP GBP
-------------------------------------- ---- ----------- ----------- -----------
Non-current assets
Intangible assets 13 - - 75,000
Property, plant and equipment 14 12,325 2,134 2,087
Investment in subsidiary undertakings 15 1,289,509 954,894 954,894
Trade and other receivables 17 610,423 417,582 1,383,027
-------------------------------------- ---- ----------- ----------- -----------
Total non-current assets 1,912,257 1,374,610 2,415,008
-------------------------------------- ---- ----------- ----------- -----------
Current Assets
Trade and other receivables 17 33,486 39,289 60,740
Corporation tax - 112,358 -
Cash and cash equivalents 18 11,378 481,638 1,674
-------------------------------------- ---- ----------- ----------- -----------
Total current assets 44,863 633,285 62,414
-------------------------------------- ---- ----------- ----------- -----------
TOTAL ASSETS 1,957,121 2,007,895 2,477,422
-------------------------------------- ---- ----------- ----------- -----------
Equity attributable to shareholders
Share capital 19 4,791,747 4,512,087 2,743,240
Share premium 19 6,330,629 5,583,109 4,790,405
Other reserves 21 201,545 246,890 85,613
Retained loss (9,524,637) (8,759,311) (5,862,193)
-------------------------------------- ---- ----------- ----------- -----------
Total equity 1,799,284 1,582,775 1,757,065
-------------------------------------- ---- ----------- ----------- -----------
Current liabilities
Trade and other payables 22 157,837 311,894 637,353
Social security and other taxes - 3,226 3,004
Borrowings 0 23 - 110,000 80,000
-------------------------------------- ---- ----------- ----------- -----------
Total current liabilities 157,837 425,120 720,357
-------------------------------------- ---- ----------- ----------- -----------
TOTAL LIABILITIES 157,837 425,120 720,357
-------------------------------------- ---- ----------- ----------- -----------
TOTAL EQUITY AND LIABILITIES 1,957,121 2,007,895 2,477,422
-------------------------------------- ---- ----------- ----------- -----------
The notes on pages 34 to 66 form part of these Financial
Statements.
These Financial Statements were approved by the Board of
Directors and authorised for issue on 24 June 2019 and were signed
on its behalf by:
Nigel Burton
Non-Executive Chairman
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
As at 31 December 2018
Share Share Other Translation Retained Minority Total
capital premium reserves reserve loss Total interests Equity
GBP GBP GBP GBP GBP GBP GBP GBP
------------------ ----------- ----------- --------- ----------- ------------ ----------- ----------- ------------
As at 1 January
2016
(restated) 1,420,639 3,992,889 (308,749) 74,182 (4,703,661) 475,300 - 475,300
------------------ ----------- ----------- --------- ----------- ------------ ----------- ----------- ------------
Loss for the year - - - - (2,649,266) (2,649,266) - (2,649,266)
Other
comprehensive
income
for the year
Currency
translation
difference - - - (125,552) - (125,552) - (125,552)
------------------ ----------- ----------- --------- ----------- ------------ ----------- ----------- ------------
Total
comprehensive
income
for the year - - - (125,552) (2,649,266) (2,774,818) - (2,774,818)
------------------ ----------- ----------- --------- ----------- ------------ ----------- ----------- ------------
Proceeds from
shares
issued
(net of costs)(1) 1,322,601 797,516 - - - 2,120,117 - 2,120,117
Share Based
Payments
issued(2) - - 79,320 - - 79,320 - 79,320
Share Based
Payments
expired(3) - - (184,957) - - (184,957) - (184,957)
------------------ ----------- ----------- --------- ----------- ------------ ----------- ----------- ------------
Transactions with
owners,
recognised
directly in
equity 1,322,601 797,516 (105,637) - - 2,014,480 - 2,014,480
------------------ ----------- ----------- --------- ----------- ------------ ----------- ----------- ------------
As at 31 December
2016
(restated) 2,743,240 4,790,405 (414,386) (51,370) (7,352,927) (285,038) - (285,038)
------------------ ----------- ----------- --------- ----------- ------------ ----------- ----------- ------------
As at 1 January
2017
(restated) 2,743,240 4,790,405 (414,386) (51,370) (7,352,927) (285,038) - (285,038)
------------------ ----------- ----------- --------- ----------- ------------ ----------- ----------- ------------
Loss for the year - - - - (1,897,479) (1,897,479) - (1,897,479)
Other
comprehensive
income
for the year
Currency
translation
difference - - - 96,004 - 96,004 - 96,004
------------------ ----------- ----------- --------- ----------- ------------ ----------- ----------- ------------
Total
comprehensive
income
for the year - - - 96,004 (1,897,479) (1,801,475) - (1,801,475)
------------------ ----------- ----------- --------- ----------- ------------ ----------- ----------- ------------
Proceeds from
shares
issued
(net of costs)(1) 1,768,847 644,553 - - - 2,413,400 - 2,413,400
Share Based
Payments
issued(2) - 148,151 180,981 - - 329,132 - 329,132
Share Based
Payments
expired(3) - - (19,704) - - (19,704) - (19,704)
------------------ ----------- ----------- --------- ----------- ------------ ----------- ----------- ------------
Transactions with
owners,
recognised
directly in
equity 1,768,847 792,704 161,277 - - 2,722,828 - 2,722,828
------------------ ----------- ----------- --------- ----------- ------------ ----------- ----------- ------------
As at 31 December
2017
(restated) 4,512,087 5,583,109 (253,109) 44,634 (9,250,406) 636,315 - 636,315
------------------ ----------- ----------- --------- ----------- ------------ ----------- ----------- ------------
As at 1 January
2018 4,512,087 5,583,109 (253,109) 44,634 (9,250,406) 636,315 - 636,315
------------------ ----------- ----------- --------- ----------- ------------ ----------- ----------- ------------
Loss for the year - - - - (1,062,433) (1,062,433) (38,747) (1,101,180)
Other
comprehensive
income
for the year
Currency
translation
difference - - - 47,547 - 47,547 47,547
------------------ ----------- ----------- --------- ----------- ------------ ----------- ----------- ------------
Total
comprehensive
income
for the year - - - 47,547 (1,062,433) (1,014,886) (38,747) (1,053,633)
------------------ ----------- ----------- --------- ----------- ------------ ----------- ----------- ------------
Proceeds from
shares
issued
(net of costs)(1) 279,660 747,520 - - - 1,027,180 - 1,027,180
Minority
interests(6) - - - - - - 60,975 60,975
Share Based
Payments
issued(4) - - 19,500 - - 19,500 - 19,500
Share Based
Payments
exercised(5) - - (64,845) - 64,845 - - -
Transactions with
owners,
recognised
directly
in equity 279,660 747,520 (45,345) - 64,845 1,046,680 60,975 1,107,655
------------------ ----------- ----------- --------- ----------- ------------ ----------- ----------- ------------
As at 31 December
2018 4,791,747 6,330,629 (298,454) 92,181 (10,247,994) 668,109 22,228 690,337
------------------ ----------- ----------- --------- ----------- ------------ ----------- ----------- ------------
(1) Issue of shares during the year.
(2) Share Based Payments - Other warrants that have been issued
in the previous financial year.
(3) Share Based Payments - Other are warrants that have expired
in the previous financial year.
(4) Share Based Payments issued - Staff share options that have
been issued in the current financial year.
(5) Share Based Payments exercised - Other are share options
that have been exercised in the current financial year.
(6) Minority interests - non-controlling interest share in
GyroMetric Systems Limited.
The notes form part of these Financial Statements
PARENT COMPANY STATEMENT OF CHANGES IN EQUITY
As at 31 December 2018
Share Share Other Retained Total
capital premium reserves earnings
GBP GBP GBP GBP GBP
------------------------------ ----------- -------------- ------------- ---------------- -----------
As at 1 January 2016 (restated) 1,420,639 3,992,889 191,250 (4,176,326) 1,428,452
------------------------------------ ----------- ------------ -------------- ----------- -----------
Loss for the year - - - (1,685,867) (1,685,867)
Total comprehensive income
for the year - - - (1,685,867) (1,685,867)
------------------------------------ ----------- ------------ -------------- ----------- -----------
Proceeds from shares issued
(net of costs)(1) 1,322,601 797,516 - - 2,120,117
Share Based Payments issued(2) - - 79,320 - 79,320
Share Based Payments expired(3) - - (184,957) - (184,957)
------------------------------------ ----------- ------------ -------------- ----------- -----------
Transactions with owners,
recognised directly in
equity 1,322,601 797,516 (105,637) - 2,014,480
------------------------------------ ----------- ------------ -------------- ----------- -----------
As at 31 December 2016
(restated) 2,743,240 4,790,405 85,613 (5,862,193) 1,757,065
------------------------------------ ----------- ------------ -------------- ----------- -----------
As at 1 January 2017 (restated) 2,743,240 4,790,405 85,613 (5,862,193) 1,757,065
------------------------------------ ----------- ------------ -------------- ----------- -----------
Loss for the year - - - (2,897,118) (2,897,118)
Total comprehensive income
for the year - - - (2,897,118) (2,897,118)
------------------------------------ ----------- ------------ -------------- ----------- -----------
Proceeds from shares issued
(net of costs)(1) 1,768,847 644,553 - - 2,413,400
Share Based Payments issued(2) - 148,151 180,981 - 329,132
Share Based Payments expired(3) - - (19,704) - (19,704)
------------------------------------ ----------- ------------ -------------- ----------- -----------
Transactions with owners,
recognised directly in
equity 1,768,847 792,704 161,277 - 2,722,828
------------------------------------ ----------- ------------ -------------- ----------- -----------
As at 31 December 2017
(restated) 4,512,087 5,583,109 246,890 (8,759,311) 1,582,775
------------------------------------ ----------- ------------ -------------- ----------- -----------
As at 1 January 2018 4,512,087 5,583,109 246,890 (8,759,311) 1,582,775
------------------------------------ ----------- ------------ -------------- ----------- -----------
Loss for the year - - - (830,171) (830,171)
Total comprehensive income
for the year - - - (830,171) (830,171)
------------------------------------ ----------- ------------ -------------- ----------- -----------
Proceeds from shares issued
(net of costs)(1) 279,660 747,520 - - 1,027,180
Share Based Payments issued(4) - - 19,500 - 19,500
Share Based Payments
exercised(5) - - (64,845) 64,845 -
Transactions with owners,
recognised directly in
equity 279,660 747,520 (45,345) 64,845 1,046,680
----------------------------------- ------------ ------------ ---------- --------------- -----------
As at 31 December 2018 4,791,747 6,330,629 201,545 (9,524,637) 1,799,284
----------------------------------- ------------ ------------ ---------- --------------- -----------
(1) Issue of shares during the year.
(2) Share Based Payments - Other warrants that have been issued
in the previous financial year.
(3) Share Based Payments - Other are warrants that have expired
in the previous financial year.
(4) Share Based Payments issued - Staff share options that have
been issued in the current financial year.
(5) Share Based Payments exercised - Other are share options
that have been exercised in the current financial year.
The notes form part of these Financial Statements.
Group 2017 Company Company
CASH FLOW STATEMENTS Group 2018 (restated) 2018 2017 (restated)
As at 31 December 2018 Note GBP GBP GBP GBP
--------------------------------------------------- ---- ----------- ----------- --------- ----------------
Cash Flows from Operating Activities
Loss for the year before tax (1,101,180) (2,226,000) (830,171) (3,009,476)
Depreciation of property, plant
and equipment 151,670 61,772 2,859 521
Amortisation of intangible assets - 370,896 - 30,000
Share based payments 19,500 309,428 19,500 309,428
Impairments 245,530 155,796 314,379 1,954,652
Non-cash directors' fees 110,000 - 110,000 -
Bad debts 32,645 - 52,312
Loss on change of ownership
interests 42,273 - - -
Interest income (7) (12) (7) (9)
Finance costs 4,216 77,238 (10,878) 72,552
Foreign exchange (26,752) (14,426) - (37,082)
Taxation 140,480 71,977 112,358 -
(Increase) in inventories (11,011) - - -
Decrease/(Increase) in trade
and other receivables (18,933) (17,193) 5,803 21,451
(Decrease) in trade and other
payables (204,359) (279,557) (158,964) (319,229)
Cash used in operations (615,928) (1,490,081) (435,121) (924,880)
Interest expense (4,216) (77,238) 10,878 (72,552)
--------------------------------------------------- ---- ----------- ----------- --------- ----------------
Net cash used in operating activities (620,144) (1,567,319) (424,243) (997,432)
--------------------------------------------------- ---- ----------- ----------- --------- ----------------
Cash Flows from Investing Activities
Purchases of property, plant
and equipment 14 (536,031) (56,157) (13,050) (568)
Proceeds from sale of property,
plant and equipment 500 11,422 - -
Interest income 7 12 7 9
Investment in subsidiaries (250,000) - (250,000)
Loans to subsidiary undertakings - (417,204) (965,445)
Net cash (used in) from investing
activities (785,524) (44,723) (680,247) (966,004)
--------------------------------------------------- ---- ----------- ----------- --------- ----------------
Cash Flows from Financing Activities
Net proceeds from borrowings 23 500,000 37,807 - 30,000
Repayment of borrowings (450,941) (338,485) (110,000) -
Issue of shares, net of issue
costs 744,230 2,413,400 744,230 2,413,400
--------------------------------------------------- ---- ----------- ----------- --------- ----------------
Net cash generated from financing
activities 793,289 2,112,722 634,230 2,443,400
--------------------------------------------------- ---- ----------- ----------- --------- ----------------
Net (Decrease)/increase in cash
and cash equivalents (612,379) 500,680 (470,260) 479,964
Cash and cash equivalents at
beginning of year 502,998 2,318 481,638 1,674
--------------------------------------------------- ---- ----------- ----------- --------- ----------------
Cash and cash equivalents at
31 December 18 109,381 502,998 11,378 481,638
--------------------------------------------------- ---- ----------- ----------- --------- ----------------
Non-cash transactions
The principal non-cash transactions
relate to:
* Acquisition of subsidiary 16 273,600 - 273,600 -
--------------------------------------------------- ---- ----------- ----------- --------- ----------------
273,600 - 273,600 -
--------------------------------------------------- ---- ----------- ----------- --------- ----------------
The notes form part of these Financial Statements.
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 December 2018
1 General information
Remote Monitored Systems plc (the "Company") and its
subsidiaries (together the "Group") undertake survey &
inspection services, including data management & analytics.
During 2017 the Group also provided training and education
services, which were closed in early 2018. The Company is
incorporated and domiciled in the UK and its registered office is
Ground Floor, Tintagel House, London Road, Kelvedon, Essex, CO5
9BP.
The Company's shares are quoted on the Alternative Investment
Market ("AIM") of the London Stock Exchange plc.
2 Summary of accounting policies
The principal accounting policies applied in the preparation of
these Consolidated Financial Statements are set out below. These
policies have been consistently applied in the year presented,
unless otherwise stated.
(a) Basis of preparation
The Consolidated Financial Statements of Remote Monitored
Systems plc have been prepared in accordance with International
Financial Reporting Standards (IFRS) and IFRS Interpretations
Committee (IFRS IC) interpretations as adopted by the European
Union and the Companies Act 2006 applicable to companies reporting
under IFRS. The Consolidated Financial Statements have also been
prepared under the historical cost convention.
The Financial Statements are presented in GBP (GBP) rounded to
the nearest pound.
The preparation of financial statements in conformity with IFRSs
requires the use of certain critical accounting estimates. It also
requires management to exercise its judgement in the process of
applying the Group's Accounting Policies. The areas involving a
higher degree of judgement or complexity, or areas where
assumptions and estimates are significant to the Financial
Statements are disclosed in Note 4.
(b) Going concern basis
At the date of this report the Group had net cash of
approximately GBP25,000 and therefore the Directors intend to seek
to raise additional funding in the immediate future. The ability of
the Company to raise additional funds is dependent upon investor
appetite and, if necessary, the Directors' ability to obtain
alternative sources of funding.
The Directors have a reasonable expectation that the Company
will be able to raise sufficient funding to allow it to cover its
working capital for a period of twelve months from the date of
approval of the financial statements. It is for this reason they
continue to adopt the going concern basis of accounting in
preparing the financial statements.
Under the going concern assumption, an entity is ordinarily
viewed as continuing in business for the foreseeable future with
neither the intention nor the necessity of liquidation, ceasing
trading or seeking protection from creditors pursuant to laws or
regulations.
The assessment has been made based on the Group's economic
prospects which have been included in the financial budget for the
years 2019-2023, and for managing working capital, in particular
for the twelve months from the date of approval of the Financial
Statements.
The Directors have also considered the ability of the Group to
raise funds on the open market. It has demonstrated the ability to
do so through share issues during the year and after the reporting
date although the Directors note that this is not necessarily
indicative of their ability to raise future funds.
The Group's business activities together with the factors likely
to affect its future development performance and position are set
out in the Strategic Report.
For the year ended 31 December 2018, the Group's objectives,
policies and processes for managing its capital, its financial risk
management objectives, details of its financial instruments and its
exposure to credit and liquidity risk can be found in the Strategic
Report and in Note 25.
Based on these assumptions, the Directors have a reasonable
expectation that the Group and Company have adequate resources to
continue in operational existence for the foreseeable future and
therefore have adopted the going concern basis of preparation in
these Financial Statements.
The Financial Statements do not include any adjustment that may
be required should the Group and Company be unable to continue as a
going concern.
The auditors have made reference to going concern by way of a
material uncertainty within their audit report.
(c) New and amended standards
(i) New and amended standards mandatory for the first time for
the financial year beginning 1 January 2018
Standard Impact on initial application Effective date
IFRS 9 Financial Instruments 1 January 2018
Revenue from Contracts with
IFRS 15 Customers 1 January 2018
IFRS 2 Classification and Measurement 1 January 2018
of Share-based Payment Transactions
Annual improvements 2014-2016 1 January 2018
The above new and amended standards are not considered to have a
material impact on the Group or Company. Further details are
included in the following notes:
-- IFRS 9 2(j) and 2(k).
-- IFRS 15 2(r)
-- IFRS 2 (note 20)
(ii) New standards, amendments and Interpretations in issue but
not yet effective or not yet endorsed and not early adopted
The standards and interpretations that are relevant to the Group
or Company, issued, but not yet effective, up to the date of
issuance of the Financial Statements are listed below. The Company
and Group intend to adopt these standards, if applicable, when they
become effective.
Standard Impact on initial application Effective date
IFRS 16 Leases 1 January 2019
IFRIC 23 Uncertainty over Income Tax 1 January 2019
Treatments
IAS 28 (amendments) Long-term Interests in Associates 1 January 2019
and Joint Ventures
Annual Improvements 2015 - 2017 Cycle 1 January 2019
Amendments Amendments to References to 1 January 2020*
the Conceptual Framework in
IFRS Standards
IFRS 3 (amendments) Business Combinations 1 January 2020*
IAS 1 and IAS 8 (amendments) Definition of Material 1 January 2020*
* Subject to EU endorsement
There are no other IFRSs or IFRIC interpretations that are not
yet effective that would be expected to have a material impact on
the Group or Company.
The Group and Company are evaluating the impact of the new or
amended standards above. Management have reviewed IFRS 16 in detail
and they do not believe that they will have any material impact on
the classification and measurement of leases in the financial
statements.
The new or amended standards are not expected to have a material
impact on the Group's or Company's results or shareholders'
funds.
(d) Basis of consolidation
Subsidiaries are entities controlled by the Group. Control is
achieved when the Group is exposed, or has rights, to variable
returns from its involvement with the investee and has the ability
to affect those returns through its power over the investee.
Specifically, the Group controls an investee if, and only if, the
Group has:
-- Power over the investee (i.e. existing rights that give it
the current ability to direct the relevant activities of the
investee).
-- Exposure, or rights, to variable returns from its involvement with the investee
-- The ability to use its power over the investee to affect its returns.
Generally, there is a presumption that a majority of voting
rights result in control. To support this presumption and when the
Group has less than a majority of the voting or similar rights of
an investee, the Group considers all relevant facts and
circumstances in assessing whether it has power over an investee,
including:
-- The contractual arrangement with the other vote holders of the investee.
-- Rights arising from other contractual arrangements.
-- The Group's voting rights and potential voting rights.
Consolidation of a subsidiary begins when the Group obtains
control over the subsidiary and ceases when the Group loses control
of the subsidiary. Assets, liabilities, income and expenses of a
subsidiary acquired or disposed of during the year are included in
the consolidated financial statements from the date the Group gains
control until the date the Group ceases to control the subsidiary.
The acquisition method is used to account for the acquisition of
subsidiaries.
Acquisition related costs are expensed as incurred.
The Group measures goodwill at the acquisition date as the
excess of the fair value of the consideration transferred, plus the
recognised amount of any non-controlling interests, less the
recognised amount of the identifiable assets acquired and
liabilities assumed. If this consideration is lower than the fair
value of the net assets of the subsidiary acquired, the difference
is recognised in profit or loss.
Where necessary, adjustments are made to the financial
statements of subsidiaries to bring the accounting policies used
into line with those used by other members of the Group. All
significant intercompany transactions and balances between group
entities are eliminated on consolidation.
When the Group ceases to consolidate a subsidiary as a result of
losing control and the Group retains an interest in the subsidiary
and the retained interest is an associate, the Group measures the
retained interest at fair value at that date and the fair value is
regarded as its cost on initial recognition. The difference between
the net assets de-consolidated and the fair value of any retained
interest and any proceeds from disposing of a part interest in the
subsidiary is included in the determination of the gain or loss on
disposal. In addition, the Group accounts for all amounts
previously recognised in other comprehensive income in relation to
that associate on the same basis as would be required if that
subsidiary had directly disposed of the related assets or
liabilities.
Associates are all entities over which the Group has significant
influence but not control over the financial and operating
policies.
References to joint venture agreements do not refer to
arrangements which meet the definition of joint ventures under IFRS
11 "Joint Arrangements" and therefore these Financial Statements do
not reflect the accounting treatments required under IFRS 11.
Investments in associates and jointly controlled entities are
accounted for using the equity method of accounting and are
initially recognised at cost. The Group's share of its associates'
post-acquisition profits or losses is recognised in profit or loss,
and its share of post-acquisition movements in reserves is
recognised in other comprehensive income. The cumulative
post-acquisition movements are adjusted against the carrying amount
of the investment.
When the Group's share of losses exceeds its interest in an
equity-accounted investee the carrying amount of the investment,
including any other unsecured receivables, is reduced to zero, and
the recognition of further losses is discontinued, unless the Group
has incurred obligations or made payments on behalf of the
investee.
Unrealised gains on transactions between the Group and
equity-accounted investees are eliminated to the extent of the
Group's interest in the investee. Unrealised losses are also
eliminated unless the transaction provides evidence of an
impairment of the asset transferred.
Accounting policies of equity-accounted investees have been
changed where necessary to ensure consistency with the policies
adopted by the Group. Dilution gains and losses arising in
investments in equity-accounted investees are recognised in profit
or loss.
Transactions with non-controlling interests that do not result
in loss of control are accounted for as equity transactions. Gains
or losses on disposals to non-controlling interests are recorded in
equity.
The Group discontinues the use of the equity method from the
date when the investment ceases to be an associate or when the
investment is classified as held for sale. When the Group retains
an interest in the former associate or joint venture and the
retained interest is a financial asset, the Group measures the
retained interest at fair value at that date and the fair value is
regarded as its fair value on initial recognition. The difference
between the carry amount of the associate at the date the equity
method was discontinued, and the fair value of any retained
interest and any proceeds from disposing of a part interest in the
associate is included in the determination of the gain or loss on
disposal. In addition, the Group accounts for all amounts
previously recognised in other comprehensive income in relation to
that associate on the same basis as would be required if that
associate had directly disposed of the related assets of
liabilities.
When the Group reduces its ownership interest in an associate
but the Group continues to use the equity method, the Group
reclassifies to profit or loss the proportion of the gain or loss
that had previously been recognised in other comprehensive income
relating to that reduction in ownership interest if that gain or
loss would be reclassified to profit or loss on the disposal of the
related assets or liabilities.
(e) Segmental reporting
Operating segments are reported in a manner consistent with the
internal reporting provided to the chief operating decision-maker
("CODM"). The CODM is deemed to be the Chief Executive Officer and
the Chief Financial Officer.
Operating segments are identified on the basis of internal
reports that are regularly reviewed by the CODM to allocate
resources and to assess performance. Using the Group's internal
management reporting as a starting point, three reporting segments
set out in note 5 have been identified.
The individual financial statements of each Group company are
measured in the currency of the primary economic environment in
which it operates (its functional currency) being US Dollar or
Pounds Sterling. For the purpose of the Group Financial Statements,
the results and financial position are expressed in Pound Sterling
GBP, which is the presentation currency for the Group and
company.
(f) Foreign currencies
Functional and presentation currency
The functional and presentational currency has been changed with
effect from 1 January 2018 from US dollars to Sterling. The change
in functional currency reflects the fact that the Group's training
and US activities have been discontinued with the closure of all US
entities almost finalised, and Geocurve is now the main trading
entity within the Group. All of Geocurve's contracts are with UK
customers and are invoiced in Sterling. The vast majority of the
Group's expenses are now also in Sterling. Therefore, Sterling is
considered to be the functional currency. The change in functional
currency has been adopted prospectively from 1 January 2018.
Prior year adjustment
The change in presentational currency is considered to be a
change in the Group's accounting policies and has therefore been
accounted for retrospectively as though the presentational currency
of the Group was always Sterling. Opening equity as at 1 January
2016 and 1 January 2017 has been translated at historic rates, the
Statement of Comprehensive Income has been translated at average
rates for 2016 and 2017 and the Statement of Financial Position has
been translated at the closing rate for 31 December 2016 and 31
December 2017. The Financial Statements have been retranslated from
the Groups inception, therefore there are no gains/losses arising
from the changes in presentational currency.
Transactions and balances
In preparing the financial statements of the individual
companies, transactions in currencies other than the entity's
functional currency (foreign currencies) are recorded at the rates
of exchange prevailing on the dates of the transactions. At the
Statement of Financial Position date, monetary assets and
liabilities that are denominated in foreign currencies are
translated at the rates prevailing on the Statement of Financial
Position date. Exchange differences arising on the settlement of
monetary items, and on the translation of monetary items at the
Statement of Financial Position date, are included in the Statement
of Comprehensive Income for the year.
(g) Intangible assets
Goodwill arises on the acquisition of subsidiaries and
represents the excess of the consideration transferred, the amount
of any non-controlling interest in the acquiree and the
acquisition-date fair value of any previous equity interest in the
acquiree over the fair value of the identifiable net assets
acquired. If the total of consideration transferred,
non-controlling interest recognised and previously held interest
measured at fair value is less than the fair value of the net
assets of the subsidiary acquired, in the case of a bargain
purchase, the difference is recognised directly in the Statement of
Comprehensive Income.
For the purpose of impairment testing, goodwill acquired in a
business combination is allocated to each of the CGUs, or groups of
CGUs, that is expected to benefit from the synergies of the
combination. Each unit or group of units to which the goodwill is
allocated represents the lowest level within the entity at which
the goodwill is monitored for internal management purposes.
Goodwill is monitored at the operating segment level.
Goodwill impairment reviews are undertaken annually or more
frequently if events or changes in circumstances indicate a
potential impairment. The carrying value of the CGU containing the
goodwill is compared to the recoverable amount, which is the higher
of value in use and the fair value less costs of disposal. Any
impairment is recognised immediately as an expense and is not
subsequently reversed.
Customer lists and intellectual property rights are shown at
historic costs, less amortisation. Costs associated with
maintaining intellectual property rights are recognised as an
expense as incurred. Costs incurred in development have been
capitalised, on the basis that the Company will have access to
future economic benefits deriving from ownership of this new
technology.
Development costs that are directly attributable to the design
and testing of identifiable and unique software products controlled
by the Company are recognised as intangible assets when the
following criteria are met:
-- it is technically feasible to complete the software product
so that it will be available for use;
-- management intends to complete the software product and use or sell it;
-- there is an ability to use or sell the software product;
-- it can be demonstrated how the software product will generate
probable future economic benefits;
-- adequate technical, financial and other resources to complete
the development and use or sell the software product are available;
and
-- the expenditure attributable to the software product during
its development can be reliably measured.
The Group's Intangible assets, other than goodwill, are
amortised at 20% per annum on a straight line basis.
At each year end date, the Group reviews the carrying amounts of
its intangible assets to determine whether there is any indication
that those assets have suffered an impairment loss. If any such
indication exists, the recoverable amount of the asset is estimated
in order to determine the extent of the impairment loss (if any).
Where the asset does not generate cash flows that are independent
from other assets, the Group estimates the recoverable amount of
the cash-generating unit to which the asset belongs.
In assessing value in use, the estimated future cash flows are
discounted to their present value, using a pre-tax discount rate
that reflects current market assessments of the time value of money
and the risks specific to the asset for which the estimates of
future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit)
is estimated to be less than its carrying amount, the carrying
amount of the asset (cash-generating unit) is reduced to its
recoverable amount. An impairment loss is recognised as an expense
immediately.
(h) Property, plant and equipment
All property, plant and equipment are shown at cost less
subsequent depreciation and impairment. Cost includes expenditure
that is directly attributable to the acquisition of items.
Subsequent costs are included in the asset's carrying amount or
recognised as a separate asset, as appropriate, only when it is
probable that future economic benefits associated with the item
will flow to the Group and the cost of the item can be measured
reliably. The carrying amount of the replaced part is derecognised.
All other repairs and maintenance are charged to the Income
Statement during the financial year in which they are incurred.
Depreciation is charged so as to write off the cost of assets
over their useful economic lives, using the straight-line method,
which is considered to be as follows:
-- Plant and equipment - 5 years
-- Motor Vehicles - 3 to 5 years
-- Software - 3 years
The assets' residual values and useful lives are reviewed, and,
if appropriate, asset values are written down to their estimated
recoverable amounts, at each Statement of Financial Position
date.
Gains and losses on disposals are determined by comparing
proceeds with the carrying amounts and are included in Statement of
Comprehensive Income.
(i) Financial assets
The Group and Company has classified all of its financial assets
as loans and receivables. The classification depends on the purpose
for which the financial assets were acquired. Management determines
the classification of its financial assets at initial
recognition.
Loans and receivables are non-derivative financial assets with
fixed or determinable payments that are not quoted in an active
market. They are included in current assets. The Group's loans and
receivables comprise trade and other receivables and cash and cash
equivalents in the Statement of Financial Position.
Loans and receivables are initially recognised at fair value
plus transaction costs and are subsequently carried at amortised
cost using the effective interest method, less provision for
impairment.
The Group adopted IFRS 9 on 1 January 2018 and applied the
standard prospectively. It noted no material change upon initial
adoption.
(j) Impairment of financial assets
From 1 January 2018, the Group assesses, on a forward-looking
basis, the expected credit losses associated with its debt
instruments carried at amortised cost. The impairment methodology
applied depends on whether there has been a significant increase in
credit risk. A financial asset, or a group of financial assets, is
impaired, and impairment losses are incurred, only if there is
objective evidence of impairment as a result of one or more events
that occurred after the initial recognition of the asset (a "loss
event"), and that loss event (or events) has an impact on the
estimated future cash flows of the financial asset, or group of
financial assets, that can be reliably estimated.
The criteria that the Group and Company uses to determine that
there is objective evidence of an impairment loss include:
-- significant financial difficulty of the issuer or obligor;
-- a breach of contract, such as a default or delinquency in interest or principal repayments.
The amount of the loss is measured as the difference between the
asset's carrying amount and the present value of estimated future
cash flows (excluding future credit losses that have not been
incurred), discounted at the financial asset's original effective
interest rate. The asset's carrying amount is reduced, and the loss
is recognised in the profit or loss.
For trade receivables, the Group applies the simplified approach
permitted by IFRS 9, which requires expected lifetime losses to be
recognised from initial recognition of the receivables.
If, in a subsequent year, the amount of the impairment loss
decreases and the decrease can be related objectively to an event
occurring after the impairment was recognised (such as an
improvement in the trade and other receivables credit rating), the
reversal of the previously recognised impairment loss is recognised
in the Statement of Comprehensive Income.
(k) Trade and other receivables
Trade receivables are amounts due from customers for services
performed in the ordinary course of business. If collection is
expected in one year or less (or in the normal operating cycle of
the business if longer), they are classified as current assets. If
not, they are presented as non-current assets.
(l) Cash and cash equivalents
In the Statement of Cash Flows, cash and cash equivalents
comprise cash in hand and deposits held at call with banks.
(m) Share capital and reserves
Equity comprises the following:
-- "Share Capital" represents ordinary shares issued at par
value and includes "Deferred Shares" below
-- "Deferred Shares" represents notional shares arising on the
redenomination of the nominal share capital from 1p to 0.1p on 11
August 2016 and 0.1p to 0.01p on 17 October 2017. The Deferred
Shares form part of the Share Capital balance shown in the
Statement of Financial Position.
-- "Share Premium" represents the premium paid on shares issued above par value; and
-- "Retained earnings" represents retained losses.
-- "Merger reserve" - The merger arose from the difference
between the carrying value of the investment and the nominal value
of the shares of subsidiaries upon consolidation under merger
accounting. The merger reserve is presented in "other
reserves".
-- Share option and warrants reserve - represents the fair value
of unexpired warrants at the issue date.
Ordinary shares are classified as equity. 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.
(n) Share-based payments
The Group operates a number of equity-settled, share-based
compensation plans, under which the entity receives goods or
services from employees or third party suppliers as consideration
for equity instruments of the Company. The fair value of the
equity-settled share based payments are recognised as an expense in
the Statement of Comprehensive Income or charged to equity
depending on the nature of the services provided or instruments
issued.
(o) Trade and other payables
Trade payables are obligations to pay for goods or services that
have been acquired in the ordinary course of business from
suppliers. Accounts payable are classified as current liabilities
if payment is due within one year or less. If not, they are
presented as non-current liabilities. Trade payables are recognised
initially at fair value, and subsequently measured at amortised
cost using the effective interest method.
(p) Borrowings
Borrowings are recognised initially at fair value, net of
transaction costs incurred. Borrowings are subsequently carried at
amortised cost; any difference between the proceeds (net of
transaction costs) and the redemption value is recognised in the
Income Statement over the year of the borrowings using the
effective interest method.
(q) Revenue recognition
During 2018 the Group generated its revenue from the provision
of survey services performed on a 'time and materials' basis.
Revenues were recognised on these services when the services were
rendered to clients as per the terms of specific contracts. In the
case of fixed price contracts, revenues are recognised on a
percentage of completion basis. Turnover is stated net of value
added tax in respect of continuing activities.
FRS 15 was adopted from 1 January 2018. There were no material
changes to the revenue arising from the adoption.
Under IFRS 15, Revenue from Contracts with Customers, the five
key points to recognise revenue have been assessed:
Step 1: Identify the contract(s) with a customer; Step 2:
Identify the performance obligations in the contract; Step 3:
Determine the transaction price; Step 4: Allocate the transaction
price to the performance obligations in the contract; and Step 5:
Recognise revenue when (or as) the entity satisfies a performance
obligation.
The Group recognises revenue when the amount of revenue can be
reliably measured, it is probable that future economic benefits
will flow to the entity, and specific criteria have been met for
each of the Group's activities, as described below: if revenue has
been billed but the specific performance obligation are not met
then this is recognised as deferred revenue.
The Group bases its estimates on historical results, taking into
consideration the type of customer, the type of transaction and the
specifics of each arrangement. Where the Group makes sales relating
to a future financial period, these are deferred and recognised
under 'deferred revenue' on the Statement of Financial Position.
The Group currently has one material revenue stream, being the
provision of survey services in Geocurve Limited. There was no
revenue recorded in GyroMetric Systems Limited during 2018.
(r) Current and deferred income tax
The tax credit represents tax currently payable less a credit
for deferred tax. The tax currently payable is based on taxable
profit for the year. Taxable profit differs from the loss for the
year as reported in the Consolidated Statement of 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 Group's liability for
current tax is calculated using tax rates that have been enacted or
substantively enacted by the Statement of Financial Position
date.
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, and is accounted for using the
liability method. 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 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
goodwill or from the initial recognition (other than in a business
combination) of other assets and liabilities in a transaction that
affects neither the taxable profit nor the accounting loss.
Deferred tax liabilities are recognised for taxable temporary
differences arising on investments in subsidiaries, except where
the Group is able to control the reversal of the temporary
difference and it is probable that the temporary difference will
not reverse in the foreseeable future.
Deferred tax is calculated at the tax rates that are expected to
apply in the relevant jurisdiction in the year when the liability
is settled or the asset is realised. Deferred tax is charged or
credited to the Consolidated Statement of Comprehensive Income,
except when it relates to items charged or credited directly to
equity, in which case the deferred tax is also dealt with in
equity. Deferred tax is not discounted.
Deferred tax assets and liabilities are offset where 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 Group intends to settle its
current tax assets and liabilities on a net basis.
(s) Leases
Leases in which a significant portion of the risks and rewards
of ownership are retained by the lessor are classified as operating
leases. Payments made under operating leases (net of any incentives
received from the lessor) are charged to the Statement of
Comprehensive Income on a straight-line basis over the year of the
lease.
3 Financial risk management
i) Group financial risk factors
The Group's activities expose it to a variety of financial
risks. The Group's finance function monitors and manages the
financial risks relating to the operations of the Group. The Group
is exposed to market risks (including foreign exchange risk and
price risk) and credit risk and to a very limited amount interest
rate risk and liquidity risk.
Risk management is carried out by the Board of Directors. The
Board provides written principles for overall risk management, as
well as written policies covering specific areas, such as foreign
exchange risk, interest rate risk and credit risk, to mitigate
financial risk exposures.
Market risk
(a) Foreign exchange risk
The Group has closed its operations located in parts of the
world whose functional currency is not the same as the Group's
functional currency (GBP Sterling), therefore the foreign exchange
risk is low. The Group's net assets arising from closed US
operations are exposed to currency risk resulting in gains and
losses on retranslation from US Dollar. Due to the minimal amount
of transactions in USD, the Group does not consider hedging its net
investments beneficial because the cash flow risk created from such
hedging techniques would outweigh the risk of foreign currency
exposure. It is the Group's policy to hold surplus funds over and
above working capital requirements in the Parent Company. The Group
considers this policy minimises any unnecessary foreign exchange
exposure.
In order to monitor the continuing effectiveness of this policy
the Board through their approval of both corporate and capital
expenditure budgets, and review of the currency profile of cash
balances and management accounts, considers the effectiveness of
the policy on an ongoing basis.
(b) Price risk
The Group is not exposed to commodity price risk as a result of
its operations. The Directors will revisit the appropriateness of
this policy should the Group's operations change in size or
nature.
Credit risk
Credit risk arises from the Group's trade receivables. Where no
independent rating of customers is available, credit control
assesses the quality of customers by reference to their financial
position, past experience and any other relevant factors.
Interest rate risk management
The Group is not exposed to interest rate risk on financial
liabilities.
Liquidity risk management
The Group manages liquidity risk by maintaining adequate
reserves and by continuously monitoring forecast and actual cash
flows and matching the maturity profiles of financial assets and
liabilities. The Group seeks to manage financial risk, to ensure
sufficient liquidity is available to meet foreseeable needs and to
invest cash assets safely and profitably.
ii) Capital risk management
The Group manages its capital to ensure that it will be able to
continue as a going concern while maximising the return to
stakeholders. The Group's capital structure primarily consists of
equity attributable to equity holders of the parent, comprising
issued capital, reserves and retained losses.
4 Critical accounting estimates and judgements
Estimates and judgements are continually evaluated and are based
on historical experience and other factors, including expectations
of future events that are believed to be reasonable under the
circumstances.
The Group makes estimates and judgements concerning the future.
The resulting accounting estimates and judgements will, by
definition, seldom equal the related actual results. The estimates
and judgements that have a significant risk of causing a material
adjustment to the carrying amount of assets and liabilities within
the next financial year are addressed below:
Intangible assets
Intangible assets comprise of development costs, customer lists,
Intellectual Property and Goodwill are amortised accordingly:
Development costs 20% per annum on a straight-line basis
Customer lists 20% per annum on a straight-line basis
Intellectual Property 20% per annum on a straight-line basis
Useful lives are based on management's estimates of the period
that the assets will generate revenues with such records being
periodically reviewed for continual appropriation.
The Group test annually whether intangible assets, which have a
carrying value as at 31 December 2018 of GBP801,111, have suffered
any impairment, in accordance with the accounting policy. Where
applicable, the recoverable amounts of cash generating units have
been determined based on value in use calculations. The value in
use calculations require the entity to estimate future cash flows
expected to arise from the cash generating unit and apply a
suitable discount rate in order to calculate present value. These
calculations require the use of estimates (Note 13).
Change in functional and presentational currency
The functional and presentational currency has been changed with
effect from 1 January 2018 from US dollars to Sterling (Note
2(f)).
Share Options
The group issued 100,000,000 (5,000,000 post consolidation)
employee share options on the 1 May 2018 at 0.06p (1.2p post
consolidation) per option, exercisable when the Company's ordinary
shares are at least 0.10p (2p post consolidation).
The valuation of options uses the Black Scholes model and is
detailed in Note 19. Changes to inputs and assumptions, in
particular concerning the volatility of the Company's share price
and the time to exercise can have a significant effect on the
valuation
Goodwill
Management review Goodwill year on year and consider the
impairment.
5 Segmental analysis
Management considers that during 2018 there were two activities,
being the provision survey and inspection services and developing
and manufacturing digital monitoring and safeguarding systems for
rotating shafts. During 2017, there were also two activities being
survey and inspection services and aviation software, training,
education services. This segmental analysis is reflected in the
Consolidated Group Statements set out herein.
Total revenue comprises:
Revenue from external customers: 2018 2017
(restated)
GBP GBP
------------------------------------------------- ------- -----------
Survey & Inspection services 857,970 638,203
Aviation Training, Education & Software Services - 150,515
Developing and manufacturing digital monitoring - -
and safeguarding systems for rotating shafts
857,970 788,718
------------------------------------------------- ------- -----------
2018 2017
(restated)
Revenues are generated in a number of countries GBP GBP
analysed as to:
------------------------------------------------- ------- -----------
United Kingdom 857,970 636,782
Europe - 16,570
United States of America - 83,459
South East Asia - 51,907
------------------------------------------------- ------- -----------
857,970 788,718
------------------------------------------------- ------- -----------
2018 2017
(restated)
The following customers generated more than 10% GBP GBP
of the Group's revenue:
------------------------------------------------- ------- -----------
Customer 1 619,438 236,832
Customer 2 91,375 126,244
Customer 3 - 62,027
Customer 4 - 61,336
Customer 5 - 39,978
------------------------------------------------- ------- -----------
710,813 526,417
------------------------------------------------- ------- -----------
Carrying amount of assets
2018 2017
(restated)
GBP GBP
------------------------- --------- -----------
United Kingdom 1,687,438 1,561,558
United States of America 463 38,365
------------------------- --------- -----------
1,687,901 1,599,923
------------------------- --------- -----------
Carrying amount of liabilities
2018 2017
(restated)
GBP GBP
------------------------- --------- -----------
United Kingdom 824,127 729,003
United States of America 195,091 234,604
------------------------- --------- -----------
1,019,218 963,607
------------------------- --------- -----------
6 Operating expenses by nature
2018 2017
(restated)
GBP GBP
-------------------------------------- --------- -----------
PR, marketing and advertising 8,587 35,783
Wages, salaries and other staff costs 546,807 706,252
Depreciation 151,670 61,772
Amortisation - 370,896
Operating lease expenses 32,033 91,795
Professional and consultancy fees 206,839 458,483
Audit fees (note 9) 45,281 80,220
Share option (credit)/expense 19,500 161,277
Net foreign exchange loss/(gain) 2,754 (14,426)
Impairment 245,612 155,796
Other expenses 156,963 404,184
-------------------------------------- --------- -----------
1,416,046 2,512,032
-------------------------------------- --------- -----------
7 Staff costs
The average number of employees, including Directors, was:
2018 (Group) 2018 (Parent) 2017 (Group) 2017 (Parent)
No. No. No. No.
--------------- ------------ ------------- ------------ -------------
Directors 5 3 4 4
Development 12 - 12 -
Administration 4 - 5 -
--------------- ------------ ------------- ------------ -------------
21 3 21 4
--------------- ------------ ------------- ------------ -------------
Employees', including Directors', costs comprise:
2017 (Parent)
2018 (Parent) 2017 (Group) (restated)
2018 (Group) (restated)
GBP GBP GBP GBP
-------------------------- -------------- --------------- ------------ -------------
Wages, salaries and other
staff costs 850,611 152,471 995,513 335,225
Social security costs 70,643 5,261 69,933 11,123
-------------------------- -------------- --------------- ------------ -------------
921,254 157,732 1,065,446 346,348
-------------------------- -------------- --------------- ------------ -------------
8 Directors
The Directors are considered to be the Key Management of the
Group.
2018 2017 (restated)
Group Short term Short term
employee employee
benefits Other Total benefits Other Total
GBP GBP GBP GBP GBP GBP
--------------- ---------- ----- ------- ---------- ------ -------
Iain McLure 10,967 - 10,967 139,459 6,366 145,825
Gerard Dempsey - - - 48,000 1,592 49,592
Paul Ryan 48,000 2,765 50,765 184,021 7,003 191,024
Trevor Brown 48,000 - 48,000 - 37,102 37,102
Nigel Burton 48,000 - 48,000 - - -
154,967 2,765 157,732 371,480 52,064 423,544
--------------- ---------- ----- ------- ---------- ------ -------
Iain McClure was paid short term employee benefits of GBP3,000
through a service company, ScotNL Consulting B.V, in 2018. Paul
Ryan was paid short term employee benefits of GBP48,000 through a
service company, Warande1970 BVBA, in 2018.
Gary Nel, former director of Geocurve Limited, is also
considered to be Key Management during the Year Ended 31 December
2018 and was paid short term employee benefits of GBP164,754 (2017
- GBP89,916).
9 Auditors remuneration
2018 2017 (restated)
GBP GBP
--------------------------------------------------------- ------- ---------------
Fees payable to the Company's auditor for the
audit of the Group and Parent Company's Financial
Statements 39,651 36,000
Fees payable to the Company's auditor for other
services:
Interim accounts and retranslation review 3,500 -
Taxation - compliance 2,130 7,698
45,281 43,698
-------------------------------------------------------- ------- ---------------
10 Finance costs
2018 2017 (restated)
GBP GBP
----------------------------------------- ----- ---------------
Interest payable and other finance costs 4,216 77,238
----------------------------------------- ----- ---------------
4,216 77,238
----------------------------------------- ----- ---------------
11 Tax
No income tax charge was recognised in profit or loss due to
losses incurred.
Group 2018 2017 (restated)
Income tax GBP GBP
-------------------------- -------- ---------------
Current tax
UK Corporation tax credit (76,142) (212,590)
-------------------------- -------- ---------------
Deferred tax
Current year 70,616 (115,931)
-------------------------- -------- ---------------
Tax credit (5,527) (328,521)
-------------------------- -------- ---------------
The tax on the Group's loss before tax differs from the
theoretical amount that would arise using the weighted average tax
rate applicable to the profits/(losses) of the consolidated
entities as follows:
2018 2017 (restated)
Group GBP GBP
-------------------------------------------------- ----------- ---------------
Loss before tax (1,063,516) (2,226,000)
-------------------------------------------------- ----------- ---------------
Tax at the applicable rate of 19.15% (31 December
2017: 21.74%): (203,663) (483,932)
Effect of:
Expenses not deductible for tax purposes 61 5,860
Depreciation in excess of capital allowances 79,337 94,595
R&D tax credit (71,023) (218,324)
Fixed asset timing differences 70,616 (115,931)
Net tax effect of losses carried forward 119,145 389,211
-------------------------------------------------- ----------- ---------------
Tax credit for the year (5,527) (328,521)
-------------------------------------------------- ----------- ---------------
The tax rate used is a combination of 19%, the standard rate of
corporation tax in the UK and US tax rate of 21% to give an
applicable rate of 19.15%.
The Group has tax losses of approximately GBP4,569,000 (31
December 2017: GBP3,505,000) available to carry forward against
future taxable profits. No deferred tax asset has been recognised
in view of the uncertainty over the timing of future taxable
profits against which the losses may be offset.
12 Earnings per share
Basic earnings per share has been calculated by dividing the
loss attributable to equity holders of the Company after taxation
by the weighted average number of shares in issue during the year.
There is no difference between the basic and diluted loss per share
as the effect on the exercise of options and warrants would be to
decrease the earnings per share.
Since the year end, warrants have been exercised which may
result in the dilution of the earnings per share in the future.
Details of share options and warrants that were anti-dilutive but
may be dilutive in the future are set out in note 20.
2018 2017 (restated)
Basic and Diluted earnings per share GBP GBP
-------------------------------------- ------------ ----------------
Loss after taxation (1,062,433) (1,897,479)
-------------------------------------- ------------ ----------------
Weighted average number of shares 301,503,017 103,983,747
-------------------------------------- ------------ ----------------
Earnings per share (pence) (0.35) (1.82)
-------------------------------------- ------------ ----------------
13 Intangible assets
2018 2017 (restated) 2016 (restated)
Goodwill - Cost and Net Book Value GBP GBP GBP
Cost
At 1 January 9,834 9,834 9,834
Additions (note 16) 324,812 - -
At 31 December 334,646 9,834 9,834
--------------------------------------------------- --------------- ------------------ ----------------
Net book value At 31 December 334,646 9,834 9,834
--------------------------------------------------- --------------- ------------------ ----------------
Customer Intellectual Development
Lists Property Costs Total
Other intangibles - Group GBP GBP GBP GBP
-------------------------------- --------- --------------- -------------------------- -------------------
Cost
At 1 January 2016 (restated) 364,972 575,800 745,117 1,685,889
Arising on acquisitions - - 734 734
Foreign exchange differences 5,255 38,237 6,504 49,996
-------------------------------- --------- --------------- -------------------------- -------------------
At 31 December 2016 (restated) 370,227 614,037 752,355 1,736,619
-------------------------------- --------- --------------- -------------------------- -------------------
Disposal - (150,000) (379,537) (529,537)
-------------------------------- --------- --------------- -------------------------- -------------------
At 31 December 2017 (restated) 370,227 464,037 372,818 1,207,082
-------------------------------- --------- --------------- -------------------------- -------------------
Arising on acquisition - 73,000 - 73,000
Disposal - (4,170) - (4,170)
At 31 December 2018 370,227 532,867 372,818 1,275,912
-------------------------------- --------- --------------- -------------------------- -------------------
Accumulated impairment
At 1 January 2016 (restated) 19,426 57,628 123,719 200,773
Impairment 86,524 134,380 192,858 413,762
-------------------------------- --------- --------------- -------------------------- -------------------
At 31 December 2016 (restated) 105,950 192,008 316,577 614,535
-------------------------------- --------- --------------- -------------------------- -------------------
Impairment 87,339 98,127 185,430 370,896
Disposal - (105,000) (338,169) (443,169)
-------------------------------- --------- --------------- -------------------------- -------------------
At 31 December 2017 (restated) 193,289 185,135 163,838 542,262
-------------------------------- --------- --------------- -------------------------- -------------------
Adjustment - - (81) (81)
Impairment 72,630 86,998 85,984 245,612
At 31 December 2018 265,919 272,133 249,741 787,793
-------------------------------- --------- --------------- -------------------------- -------------------
Net book value
At 31 December 2016 264,277 422,029 435,778 1,122,084
-------------------------------- --------- --------------- -------------------------- -------------------
At 31 December 2017 176,938 278,902 208,980 664,820
-------------------------------- --------- --------------- -------------------------- -------------------
At 31 December 2018 104,308 260,734 123,077 488,119
-------------------------------- --------- --------------- -------------------------- -------------------
The below intangible assets comprise the Intellectual Property
acquired on 16 July 2014 and 30 September 2015.
Intellectual Property
Other intangibles - Company GBP
-------------------------------- ----------------------
Cost
At 1 January 2016 (restated) 179,985
Foreign exchange differences (29,985)
-------------------------------- ----------------------
At 31 December 2016 (restated) 150,000
-------------------------------- ----------------------
Disposal (150,000)
-------------------------------- ----------------------
At 31 December 2017 (restated) -
-------------------------------- ----------------------
At 31 December 2018 -
-------------------------------- ----------------------
Accumulated amortisation
At 1 January 2016 (restated) 53,923
Impairment 32,969
Foreign exchange differences (11,892)
-------------------------------- ----------------------
At 31 December 2016 (restated) 75,000
-------------------------------- ----------------------
Impairment 30,000
Disposal (105,000)
-------------------------------- ----------------------
At 31 December 2017 (restated) -
-------------------------------- ----------------------
At 31 December 2018 -
-------------------------------- ----------------------
Net book value
At 31 December 2016 75,000
-------------------------------- ----------------------
At 31 December 2017 -
-------------------------------- ----------------------
At 31 December 2018 -
-------------------------------- ----------------------
The recoverable amount of the above cash-generating units has
been determined based on value in use calculations. The key
assumptions used for value-in-use calculations in 2018 are as
follows:
Gross margin 20-50%
Growth rate 10-45%
Discount rate 10%
Management determined budgeted gross margin based on past
performance and its expectations of market development. The average
growth rates used are consistent with the forecasts included in
industry reports. The discount rates used are pre-tax, and reflect
specific risks relating to the relevant operating segment.
The recoverable amount calculated based on value in use did not
exceed the carrying value.
4 Property, Plant and Equipment
Plant & Software Motor
equipment Vehicles Total
Group GBP GBP GBP GBP
-------------------------------
Cost
At 1 January 2016 (restated) 344,164 5,841 80,768 430,773
Additions 21,498 1,168 5,229 27,895
-------------------------------
At 31 December 2016 (restated) 365,662 7,009 85,997 458,668
Additions 48,157 - 8,000 56,157
Disposals (130,909) (24,425) (155,334)
Foreign exchange differences
& reclassification 5,488 (7,009) (30,332) (31,853)
At 31 December 2017 (restated) 288,398 - 39,240 327,638
Additions 567,193 17,900 7,031 592,124
Disposals (170,021) (31,240) (201,261)
At 31 December 2018 685,570 17,900 15,031 718,501
Accumulated depreciation
At 1 January 2016 (restated) 145,700 1,460 32,197 179,357
Charge for the year 120,699 5,549 16,591 142,839
Disposals (9,691) - 906 (8,785)
-------------------------------
At 31 December 2016 (restated) 256,708 7,009 49,694 313,411
Charge for the year 53,906 - 7,866 61,772
Disposals (88,555) (19,889) (108,444)
Foreign exchange differences
& reclassification (7,257) (7,009) (13,126) (27,392)
-------------------------------
At 31 December 2017 (restated) 214,802 - 24,545 239,347
Charge for the year 143,772 1,533 6,365 151,670
Disposals (154,102) - (22,902) (177,004)
At 31 December 2018 204,472 1,533 8,008 214,013
Net book value at 31 December
2016 (restated) 108,954 - 36,303 145,257
Net book value at 31 December
2017 (restated) 73,596 - 14,695 88,291
Net book value at 31 December
2018 481,098 16,367 7,023 504,488
14 Property, Plant and Equipment (continued)
Plant & equipment Software
Total
Company GBP GBP GBP
Cost
At 1 January 2016 (restated) 3,659 - 3,659
At 31 December 2016 (restated) 3,659 - 3,659
Additions 567 - 567
At 31 December 2017 (restated) 4,226 - 4,226
Additions - 13,050 13,050
At 31 December 2018 4,226 13,050 17,276
Accumulated depreciation
At 1 January 2016 (restated) 840 - 840
Charge for the year 732 - 732
At 31 December 2016 (restated) 1,572 - 1,572
Charge for the year 520 - 520
At 31 December 2017 (restated) 2,092 - 2,092
Charge for the year 2,134 725 2,859
At 31 December 2018 4,226 725 4,951
Net book value at 31 December
2016 (restated) 2,087 - 2,087
Net book value at 31 December
2017 (restated) 2,134 - 2,134
Net book value at 31 December
2018 - 12,325 12,325
15 Investment in subsidiary undertakings
2018 2017 (restated) 2016 (restated)
Company GBP GBP GBP
As at 1 January 954,894 954,894 954,894
Additions (note 16) 523,600 - -
Impairment (188,985) - -
Cost at 31 December 1,289,509 954,894 954,894
A projected cash flow period of five years was used to assess
the value in use for investments in subsidiary undertakings.
15 Investment in subsidiary undertakings (continued)
The following are the principal subsidiaries of the Company at
31 December 2018 and at the date of these Financial Statements.
Share
Parent Class capital Nature
Name of company Registered Address company of shares held of business
Strat Aero 19500 State Highway 249, Remote Ordinary 100% Dormant
International, Suite 655, Houston, Texas Monitored company
Inc. 77070, USA Sytems
plc
Strat Aero International Tintagel House London Remote Ordinary 100% Dormant
Limited Road, Kelvedon, Monitored company
Colchester, Sytems
Essex, CO5 9BP, UK plc
Strat Aero International 19500 State Highway 249, Strat Aero N/A 100% Dormant
Consultancy Suite 655, Houston, Texas International, company
Group, LLC 77070, USA Inc
Strat Aero Holdings, 19500 State Highway 249, Remote Ordinary 100% Holding
Inc Suite 655, Houston, Texas Monitored company
77070, USA Sytems
plc
Aero Kinetics 19500 State Highway 249, Strat Aero N/A 100% Dormant
Labs, LLC Suite 655, Houston, Texas Holdings, company
77070, USA Inc
Aero Kinetics, 19500 State Highway 249, Strat Aero N/A 100% Dormant
LLC Suite 655, Houston, Texas Holdings, company
77070, USA Inc
Nephos Services, 19500 State Highway 249, Strat Aero N/A 100% Dormant
LLC Suite 655, Houston, Texas Holdings, company
77070, USA Inc
Aero Kinetics 19500 State Highway 249, Aero Kinetics, N/A 100% Dormant
UAS TC001, LLC Suite 655, Houston, Texas LLC company
77070, USA
Geocurve Ltd Tintagel House London Remote Ordinary 100% Surveying
Road, Kelvedon, Monitored and mapping
Colchester, Sytems
Essex, CO5 9BP, UK plc
GN Site Engineers Tintagel House London Geocurve Ordinary 100% Dormant
Ltd Road, Kelvedon, Ltd company
Colchester,
Essex, CO5 9BP, UK
UKAeroVision Tintagel House London Geocurve Ordinary 100% Dormant
Limited Road, Kelvedon, Ltd company
Colchester,
Essex, CO5 9BP, UK
GyroMetric Dockholme Lock Cottage Remote Ordinary 57.8% Shaft
Systems Limited 380 Bennett Street, Monitored Monitoring
Long Eaton, Nottingham Sytems
NG10 4JF, UK plc
The following subsidiaries, also named above, are exempt from
the requirements of the Companies Act to audit the accounts under
section 479A of the Companies Act 2006:
Strat Aero International Limited
Geocurve Limited
GN Site Engineers Ltd
UKAerovision Limited
GyroMetric Systems Limited
16 Acquisition of subsidiary undertakings
The Company gained control of GyroMetric Systems Limited during
the year. The control was gained by two separate transactions, the
first in April 2018, acquiring 36.9% of GyroMetric System's share
capital for a cash consideration of GBP250,000. The second
transaction in September 2018, acquired 20.9% of GyroMetric
System's share capital by allotting 23,791,304 new shares in RMS
plc at 1.15p, at a total cost of GBP273,600. RMS plc now has a
total controlling holding in GyroMetric Systems of 57.8%.
On acquisition
(GBP)
Purchase consideration
Cash 250,000
Shares (23,791,304 shares @ 1.15p) 273,600
523,600
Non-controlling interest 60,975
Fair value of net assets acquired (see
below) (144,491)
Share of loss in associate (42,272)
Intellectual property 13 (73,000)
Goodwill 324,812
*GBP324,812 represents both the Goodwill and the Loss on
acquisition on the change in ownership interests, when acquiring
GyroMetric Systems Limited.
The fair value of net assets and liabilities arising from the
acquisition, provisionally determined, are as follows:
On acquisition
GBP
Cash and cash equivalents 141,439
Property, plant and equipment 706
Inventory 7,079
Trade and other receivables 16,253
Trade and other payables (14,873)
Director loans (6,113)
Net assets acquired 144,491
If new information obtained within one year from the acquisition
date about the facts and circumstances that existed at the
acquisition date identifies adjustments to the above amounts, or
any additional provisions that existed at the acquisition date,
then the acquisition accounting will be revised.
17 Trade and other receivables
2018 2017 (restated) 2016 (restated)
Group Company Group Company Group Company
GBP GBP GBP GBP GBP GBP
Amounts due from group
undertakings - 610,423 - 417,583 - 1,383,028
Trade receivables 183,239 - 86,523 - 103,469 9,259
VAT receivable 6,594 5,968 24,987 22,282 - 18,408
Other receivables 7,839 - 30,467 8,700 400 -
Prepayments 56,859 27,518 45,656 8,306 66,571 33,072
At 31 December 254,531 643,909 187,633 456,871 170,440 1,443,767
Less: non-current portion - (610,423) - (417,582) - (1,383,027)
Current portion 254,531 33,486 187,633 39,289 170,440 60,740
Amounts due from group undertakings GBP610,423 were impaired by
GBP150,620 during the year.
The fair value of all receivables is the same as their carrying
values stated above.
Ageing of past due trade receivables - 2018 2017 (restated) 2016 (restated)
Group:
GBP GBP GBP
Current 192,102 48,654 -
0 - 15 days 3,000 - -
16 - 30 days - 10,121 61,947
Over 30 days (11,863) 27,748 41,522
183,239 86,523 103,469
The carrying amount of the Group's trade receivables are
denominated in the following currencies:
2018 2017 (restated) 2016 (restated)
GBP GBP GBP
US Dollars - 7,182 18,876
UK Pounds 183,239 79,341 84,593
183,239 86,523 103,469
The maximum exposure to credit risk at the reporting date is the
carrying value reported above. The Group does not hold collateral
as security. Provisions totalling GBP5,832 (2017: GBP84,685) have
been made at the year-end in respect of trade receivables.
18 Cash and cash equivalents
2018 2017 (restated) 2016 (restated)
Group Company Group Company Group Company
GBP GBP GBP GBP GBP GBP
Cash at bank and in
hand 109,381 11,378 502,998 481,638 2,318 1,674
109,381 11,378 502,998 481,638 2,318 1,674
Cash at bank is held with credit institutions with an A credit
rating.
The carrying amount of the Group's cash and cash equivalents are
denominated in the following currencies:
2018
2017 (restated) 2016 (restated)
Group Company Group Company Group Company
GBP GBP GBP GBP GBP GBP
US Dollars 463 - 567 - 2,473
UK Pounds 108,918 11,378 502,431 481,638 (155) 1,674
109,381 11,378 502,998 481,638 2,318 1,674
19 Share capital
2018 2017 (restated) 2016 (restated)
Issued equity share GBP GBP
capital Number GBP Number Number
Issued and fully
paid
Ordinary shares of
0.002p (2017:0.0001p)
each 332,467,785 664,936 3,852,760,457 385,276 384,285,262 384,286
Deferred shares of
0.02p (2017:0.001p) 117,947,721 2,358,954 2,358,954,414 2,358,954 2,358,954,414 2,358,954
A Deferred shares
of 0.002p (2017:0.0001p) 883,928,368 1,767,857 17,678,567,358 1,767,857 - -
4,791,747 4,512,087 2,743,240
Group and Company Ordinary
Number of shares Share premium Total
shares GBP GBP GBP
Issued and fully paid
As at 1 January 2016 (restated) 142,063,771 1,420,639 3,992,889 5,413,528
Issue of new shares - 17 March
2016 4,575,209 45,751 228,760 274,511
Issue of new shares - 12 April
2016 35,555,556 355,556 44,444 400,000
Issue of new shares - 20 April
2016 42,422,222 424,222 53,028 477,250
Issue of new shares - 13 July
2016 37,489,288 374,893 0 374,893
Issue of new shares - 1 September
2016 74,000,000 74,000 296,000 370,000
Issue of new shares - 29 September
2016 44,750,645 44,751 268,504 313,255
Issue of new shares - 28 November
2016 3,428,571 3,428 8,571 11,999
Share issue costs - - (101,791) (101,791)
As at 31 December 2016 (restated) 384,285,262 2,743,240 4,790,405 7,533,645
As at 1 January 2017 (restated) 384,285,262 2,743,240 4,790,405 7,533,645
Issue of new shares - 24 January
2017 380,000,000 380,000 - 380,000
Issue of new shares - 14 February
2017 1,150,000,000 1,150,000 - 1,150,000
Issue of new shares - 1 March
2017 50,000,000 50,000 - 50,000
Issue of new shares - 4 December
2017 1,771,428,572 177,143 442,857 620,000
Issue of new shares - 5 December
2017 74,189,480 7,419 344,981 352,400
Issue of new shares - 28 December
2017 42,857,143 4,285 10,715 15,000
Share issue costs - - (154,000) (154,000)
Foreign exchange differences 148,151 148,151
As at 31 December 2017 (restated) 3,852,760,457 4,512,087 5,583,109 10,095,196
As at 1 January 2018 (consolidated) 192,638,023 4,512,087 5,583,109 10,095,196
Issue of new shares - 5 January
2018 58,681,220 117,362 293,406 410,768
Issue of new shares - 10 January
2018 6,785,714 13,571 33,929 47,500
Exercise of warrants - 16
January 2018 4,285,714 8,571 21,429 30,000
Exercise of warrants - 24
January 2018 1,785,714 3,571 8,929 12,500
Exercise of warrants - 31
January 2018 5,714,286 11,429 28,571 40,000
Exercise of warrants - 23
April 2018 27,857,143 55,714 139,286 195,000
Exercise of warrants - 8 June
2018 10,928,571 21,857 54,643 76,500
Issue of new shares - 7 September
2018 23,791,304 47,583 226,017 273,600
Share consolidation adjustment 96 2 - 2
Share issue costs - - (20,539) (20,539)
Foreign exchange differences - - (38,151) (38,151)
As at 31 December 2018 332,467,785 4,791,747 6,330,629 11,122,376
On 5 January 2018 the Company issued 1,173,624,395 (58,681,220
post consolidation) ordinary shares of 0.01p (0.2p post
consolidation) each at a price of 0.035p (0.7p post consolidation)
per share raising GBP410,768. A certain director took part in the
open offer and subscribed to 186,010,627 (9,300,531 post
consolidation) new ordinary shares at a price of 0.035p (0.7p post
consolidation).
On 10 January 2018 the Company issued 135,714,286 (6,785,714
post consolidation) new ordinary shares of 0.01p (0.2p post
consolidation) each at a price of 0.035p (0.7p post consolidation)
per share in consideration for outstanding fees payable by the
Company to an adviser.
On 16 January 2018 the Company issued 85,714,286 (4,285,714 post
consolidation) new ordinary shares of 0.01p (0.2p post
consolidation) each at a price of 0.035p (0.7p post consolidation)
per share as a result of an exercise of warrants.
On 24 January 2018 the Company issued 35,714,286 (1,785,714 post
consolidation) new ordinary shares of 0.01p (0.2p post
consolidation) each at a price of 0.035p (0.7p post consolidation)
per share as a result of an exercise of warrants.
On 31 January 2018 the Company issued 114,285,714 (27,857,143
post consolidation) new ordinary shares of 0.01p (0.2p post
consolidation) each at a price of 0.035p (0.7p post consolidation)
per share as a result of an exercise of warrants.
On 23 April 2018 the Company issued 557,142,857 (5,714,286 post
consolidation) new ordinary shares of 0.01p (0.2p post
consolidation) each at a price of 0.035p (0.7p post consolidation)
per share as a result of an exercise of warrants. The warrants
related to certain directors who exercised 485,714,286 (24,285,714
post consolidation) and 71,428,571 (3,571,429 post consolidation)
respectively.
On 8 June 2018 the Company issued 218,571,428 (10,928,571 post
consolidation) new ordinary shares of 0.01p (0.2p post
consolidation) each at a price of 0.035p (0.7p post consolidation)
per share as a result of an exercise of warrants.
On 7 September 2018 the Company issued 23,791,304 new ordinary
shares of 0.2p each at a price of 1.15p per share in consideration
for a controlling interest in GyroMetric Systems Limited,
increasing the Company's shareholding in GyroMetric from 36.9% to
57.8%.
Share Options
At 31 December 2018, the following options over ordinary shares
have been granted to the previous director of Geocurve Limited Mr G
Nel, who resigned on 31 March 2019, and employees of Geocurve
Limited. The share options remain unexercised:
Exercise
Grant date Number of shares price Exercise period
1 May 2018 to 30 April
1 May 2018 100,000,000 0.06p 2023
Warrants
At 31 December 2018 the following warrants over ordinary shares
have been issued and remain unexercised:
Grant date Number of shares Exercise price Exercise date
17/11/2014 16,875 1.6p 16/11/19
17/11/2014 6,094 1.6p 16/11/19
14/10/2015 49,451 1p 13/10/20
12/04/2016 222,222 0.225p 11/04/19
12/04/2016 177,778 0.225p 11/04/19
20/04/2016 212,111 0.225p 19/04/19
26/08/2016 370,000 0.10p 01/09/19
22/02/2017 5,000,000 0.045p 31/01/19
22/02/2017 3,750,000 0.045p 31/01/19
22/02/2017 2,999,650 0.045p 31/01/19
22/02/2017 3,000,000 0.045p 31/01/19
22/02/2017 1,250,000 0.045p 31/01/19
22/02/2017 1,000,000 0.045p 31/01/19
22/02/2017 1,900,000 0.045p 31/01/19
22/02/2017 8,750,000 0.045p 22/02/19
22/02/2017 5,800,000 0.045p 22/02/19
22/02/2017 1,500,000 0.045p 22/02/19
22/02/2017 1,250,000 0.045p 22/02/19
22/02/2017 500,000 0.045p 22/02/19
22/02/2017 2,500,000 0.045p 22/02/19
22/02/2017 5,200,000 0.045p 22/02/19
22/02/2017 5,000,000 0.045p 22/02/19
22/02/2017 3,750,000 0.045p 22/02/19
22/02/2017 3,500,000 0.045p 22/02/19
22/02/2017 2,500,000 0.045p 22/02/19
22/02/2017 5,000,000 0.045p 22/02/19
22/02/2017 1,250,000 0.045p 22/02/19
22/02/2017 5,500,000 0.045p 22/02/19
22/02/2017 4,250,000 0.045p 22/02/19
22/02/2017 350 0.045p 31/01/19
22/02/2017 750,000 0.045p 22/02/19
22/06/2017 1,500,000 0.045p 22/06/19
20 Share-based payments
Share option plan
100,000,000 (5,000,000 post consolidation) employee share
options issued on the 1 May 2018 at 0.06p (1.2p post consolidation)
per option, exercisable when the Company's ordinary shares are at
least 0.10p (2p post consolidation). Included within the employee
share options granted was 83,333,333 (4,166,667 post consolidation)
options granted to Mr G Nel, a director of Geocurve Limited. Mr G
Nel subsequently resigned on 31 March 2019.
Fair value of Share Options:
The fair value of the share options granted in the year have
been calculated using the Black Scholes model assuming the inputs
shown below:
Grant date 1 May 2018
No of options/warrants
granted 100,000,000
Share price on date
of grant 0.01p
Exercise price 0.06p
Continuous growth rate 1.79%
Dividend yield 0.00%
Volatility 23.39%
Time to maturity 5
Value of option in accounts 0.00001
The share options outstanding at 31 December 2018 had a weighted
average remaining contractual life of 4.4 years.
No options were exercised during the year.
Warrants
Warrants to subscribe for new Ordinary Shares in the Company
were in issue as follows:
2018 2017 (restated) 2016 (restated
Weighted Weighted Weighted
average average average
No. of price No. of price No. of price
warrants GBP warrants GBP warrants GBP
At 1 January 131,025,960 0.04 1,054,531 0.2 1,806,968 1.6
Granted during the
year - - 129,971,429 0.04 982,111 0.2
Exercised during
the year (50,571,429) 0.007 - - (1,734,548) 1.6
Outstanding at 31
December 80,454,531 0.05 131,025,960 0.04 1,054,531 0.2
Exercisable at 31
December 80,454,531 0.05 131,025,960 0.04 1,054,531 0.2
The warrants outstanding at 31 December 2018 had a weighted
average remaining contractual life of 2 months (31 December 2017:
1.5 years).
No warrants were issued during the year.
The fair value of the warrants granted in the year and
comparative year have been calculated using the Black Scholes
model
21 Share options and warrants reserve
The measurement requirements of IFRS 2 have been implemented in
respect of share options and warrants granted. The credit
recognised for share based payments during the year is (GBP45,345)
(2017: GBPnil).
Company
Share Share option
option and warrants
and warrants Total reserve Merger Total
reserve reserve
GBP GBP GBP GBP GBP
At 1 January 2016 (restated) 191,250 191,250 191,250 (499,999) (308,749)
Share warrants issued
(note 19) 56,338 56,338 56,338 - 56,338
Share warrants exercised
(note 19) (176,238) (176,238) (176,238) - (176,238)
Foreign exchange differences 14,263 14,263 14,263 14,263
At 31 December 2016
(restated) 85,613 85,613 85,613 (499,999) (414,386)
At 1 January 2017 (restated) 85,613 85,613 85,613 (499,999) (414,386)
Share warrants issued
(note 19) 161,277 161,277 161,277 - 161,277
At 31 December 2017
(restated) 246,890 246,890 246,890 (499,999) (253,109)
At 1 January 2018 246,890 246,890 246,890 (499,999) (253,109)
Share options issued
(note 19) 19,500 19,500 19,500 - 19,500
Share warrants exercised
(note 19) (64,845) (64,845) (64,845) - (64,845)
At 31 December 2018 201,545 201,545 201,545 (499,999) (298,454)
22 Trade and other payables
2018 2017 2016
Group Company Group Company Group Company
GBP GBP GBP GBP GBP GBP
Trade payables 141,220 80,218 300,632 207,595 445,724 303,982
VAT payable 35,734 - 28,601 - 2,055 -
Corporation Tax - - 5,567 - - -
Accruals 87,308 77,619 171,478 104,299 424,087 323,977
Deferred revenue 140,000 -
Other creditors - - 10,955 - 23,076 9,394
404,262 157,837 517,233 311,894 894,942 637,353
23 Borrowings
2018 2017 2016
Group Company Group Company Group Company
GBP GBP GBP GBP GBP GBP
Other borrowings 166,666 - 117,807 110,000 418,485 80,000
At 31 December 166,666 - 117,807 110,000 418,485 80,000
Less: non-current
portion - - - - (338,485) -
Current portion 166,666 - 117,807 110,000 80,000 80,000
Reconciliation to cash flows from financing activities:
Group Company
Balance as at 1 Jan 2017 418,485 80,000
Net proceeds from borrowings 37,807 30,000
Repayment (338,485) -
Balance as at 31 December 2017 117,807 110,000
Balance as at 1 Jan 2018 117,807 110,000
Net proceeds from borrowings 500,000 -
Repayment (451,141) (110,000)
Balance as at 31 December 2018 166,666 -
24 Deferred tax
2018 2017 2016
Group Company Group Company Group Company
GBP GBP GBP GBP GBP GBP
Deferred tax liabilities
Deferred tax liability
after more than 12
months 206,328 - 135,712 - 243,314 -
Deferred tax liabilities 206,328 - 135,712 - 243,314 -
Deferred tax relates to timing differences in respect of the
investment in Geocurve Limited and Tangible Fixed Assets.
The movement in the deferred tax account is as follows:
2018 2017 2016
Group Company Group Company Group Company
GBP GBP GBP GBP GBP GBP
At 1 January 135,712 - 271,119 - 243,314 -
Investment in subsidiaries 26,522 - (146,700) - - -
Fixed asset timing
differences 44,094 - 11,293 - - -
At 31 December 206,328 - 135,712 - 243,314 -
25 Financial instruments
Categories of financial instruments
2018 2018
Group Company
GBP GBP
Assets - Loans and receivables
Trade and other receivables (excluding
prepayments) 216,062 616,390
Cash and cash equivalents 109,381 11,378
325,443 627,768
Liabilities - At amortised cost
Trade and other payables (excluding non-financial
liabilities) 418,916 80,218
Borrowings 166,666 -
585,582 80,218
2017 (restated) 2017 (restated)
Group Company
GBP GBP
Assets - Loans and receivables
Trade and other receivables (excluding
prepayments) 288,324 560,923
Cash and cash equivalents 502,998 481,638
791,322 1,042,561
Liabilities - At amortised cost
Trade and other payables (excluding non-financial
liabilities) 538,610 210,821
Borrowings 117,807 110,000
656,417 320,821
Categories of financial instruments
2016 (restated) 2016 (restated)
Group Company
GBP GBP
Assets - Loans and receivables
Trade and other receivables (excluding
prepayments) 103,869 1,410,695
Cash and cash equivalents 2,318 1,674
106,187 1,412,369
Liabilities - At amortised cost
Trade and other payables (excluding non-financial
liabilities) 649,085 316,380
Borrowings 418,485 80,000
1,067,570 396,380
26 Financial commitments
Operating leases
At 31 December 2018 the Group had outstanding commitments for
future minimum lease payments under non-cancellable operating
leases which fall due as follows:
2017 (restated) 2016 (restated)
2018 2018 Land 2017 (restated) Land and Land and
Other and buildings Other buildings buildings
GBP GBP GBP GBP GBP
No later than one
year 2,067 29,500 588 52,562 101,320
Later than one year
but no later than
5 years 1,773 68,833 882 106,021 102,572
Total future minimum
lease payments 3,840 98,333 1,470 158,583 203,892
27 Related party transactions
Directors' transactions
The directors of the Company who participated in the December
2017 Placing (shares issued on 5 January 2018) were as follows:
-- Paul Ryan subscribed for 186,010,627 (9,300,531 consolidated)
new ordinary shares of 0.035p (0.7p consolidated) each for
GBP65,000
Directors remuneration is disclosed in note 8.
The amount owing to Nigel Burton in respect of unpaid salary for
2018 is GBP11,182 (2017 - GBPnil). This amount is included in
accruals.
Paul Ryan is a director of Warande1970 BVBA which the Group pays
in relation to Paul's director fee. GBP60,637 is outstanding and
included in trade payables as at this date (2017 - GBP43,127).
The second stage of the step-acquisition of GyroMetric, 20.9% of
the share capital acquired by allotting 23,791,304 new shares in
RMS plc at 1.15p, at a total cost of GBP273,600, was acquired from
Braveheart Investment Group plc, a company in which Trevor Brown is
a Director and owns 29.82% of the share capital.
Parent Company transactions with subsidiary companies
During the year the Company received GBPnil (31 December 2017:
GBP73,445) management fees from its subsidiaries.
At the year-end GBP610,423 (31 December 2017: GBP417,582) was
due from the subsidiary companies as follows (note 16).
- Geocurve Ltd GBP610,423 (2017: GBP417,582)
The above balance owing from Geocurve Ltd was impaired by
GBP150,620 during the year.
28 Ultimate controlling party
Due to the company being a public limited company, there is not
considered to be a controlling party. For details on major
shareholdings please refer to the Director's Report.
29 Events after the reporting year
On 17 January 2019 the Company issued 53,846,154 new ordinary
shares of 0.2p each at a price of 0.65p per share raising
GBP350,000.
Directors' transactions
The Directors of the Company who participated in the January
2019 Placing were as follows:
-- Nigel Burton subscribed GBP100,000 for 15,384,615 Shares.
-- Trevor Brown subscribed GBP100,000 for 15,384,615 Shares.
COMPANY INFORMATION
Directors Trevor Brown (Chief Executive Officer)
Nigel Burton (Non-Executive Chairman)
Paul Ryan (Non-Executive Director)
Website www.remotemonitoredsystems.com
Registered Office Ground Floor
Tintagel House
London Road
Kelvedon
Essex CO5 9BP
Registered Number 09109008
Nominated Adviser SP Angel Corporate Finance LLP
and Joint Broker Prince Frederick House
35-39 Maddox Street
London W1S 2PP
Joint Broker Peterhouse Corporate Finance Limited
New Liverpool House
15 Eldon Street
London EC2M 7LD
Solicitors Edwin Coe
2 Stone Buildings
Lincoln's Inn
London
WC2A 3TH
Independent Auditor PKF Littlejohn LLP
Statutory Auditor
1 Westferry Circus
Canary Wharf
London E14 4HD
Registrars Share Registrars Limited
First Floor
9 Lion and Lamb Yard
Farnham
Surrey GU9 97LL
Details of the Directors and their backgrounds are as
follows:
Trevor Brown (aged 72, British)
Chief Executive Officer
Trevor Brown has been a strategic investor in real estate and
equities for more than 30 years.
Mr Brown is currently an Executive Director of IQAI plc, CEO of
Braveheart Investment Group plc and until December 2017 was a
Non-Executive Director of Management Resource Solutions plc. He was
also a director of AIM listed Feedback plc and of Advanced
Oncotherapy plc.
Nigel Burton (aged 61, British)
Non-Executive Chairman
Nigel has over 30 years' experience in operational and financial
management, debt and equity financing, acquisition and integration
of businesses, disposals, IPOs and trade sales. Following over 14
years as an investment banker at leading City institutions
including UBS Warburg and Deutsche Bank, including as the Managing
Director responsible for the energy and utilities industries, Nigel
spent 15 years as Chief Financial Officer of a number of private
and public companies, including Navig8 Product Tankers Inc,
PetroSaudi Oil Services Limited, Advanced Power AG, and Granby Oil
and Gas plc. Nigel is currently Non-Executive Chairman of
AIM-listed Regency Mines plc and a Non-Executive Director of
AIM-listed Digitalbox plc and Tau Capital plc, and until January
2019 was Chief Executive Officer of Nu-Oil and Gas plc.
Nigel is a Chartered Electrical Engineer and a Past President of
the IET. He has a B.Sc. (First Class Hons) in Electrical and
Electronic Engineering and a Ph.D in Acoustic Imaging from
University College London.
Paul Ryan (aged 51, Irish)
Non-Executive Director
Paul has 20 years of transactional, commercial and regulatory
experience in the telecommunications and ICT sectors with
international blue chip entities, during which he has been involved
in transactions with a value in excess of US$10 billion. From 2002
to 2013, he held a variety of board positions with leading mobile
operator Vodafone and its operating subsidiaries, including Head of
Strategy, Regulatory and Political Affairs in Brussels and Director
of Strategy and External Affairs for Vodafone Ireland and Vodafone
Ghana. Prior to this, he worked as a management consultant in the
European telecoms sector, served as a strategic adviser at Ofcom,
the UK's communications industry regulator, and was a solicitor at
leading international City law firm Ashurst. He acts as an adviser,
primarily on strategy and public policy, to a range of clients
including FTSE100 and Fortune 500 companies largely in the ICT
space. Paul is a qualified solicitor in the UK and graduated from
Trinity College, Dublin, Ireland.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
FR SEWSAIFUSESM
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June 25, 2019 04:17 ET (08:17 GMT)
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