27 February 2024
Everest
Global plc
(“Everest”
or the “Company”)
Final
Results
The Board
of Everest is pleased to announce its final results for the year
ended 31 October 2023.
The last financial year has been very rewarding albeit not without
its challenges. With that said we consider it successful in terms
of achieving what we set out to achieve.
In October 2022, the Company name was
changed to Everest Global Plc and a new board was constituted. The
new board has integrated well and is working particularly well
together. Much was achieved in the past 12 months.
In late 2022 our existing auditors resigned as they exited the
Public Interest Entity ('PIE') audit space which left the business
without an auditor. It took some time to appoint a PIE registered
auditor, with a false start announced in December 2022. Eventually in April 2023 a PIE registered auditor, RPG Crouch
Chapman LLP ('RPGCC') was appointed. The Annual Financial
Statements for October 2022 were
produced and lodged late on 27 July
2023. Both Companies House and the Financial Conduct
Authority ('FCA') were informed of the Company's situation. During
this period the shares were suspended by the FCA. On 4 August 2023 the suspension was
lifted.
New shareholders invested in the Company on 23 January 2023. 12,726,000 new Ordinary Shares
were issued at a subscription price of 5.5
pence per share raising a total of £699,930. The
subscription price represented a premium of 119 per cent to the
closing price of 2.51 pence on
19 January 2023. Allied to this on
25 January 2023 Golden Nice
International Group Limited, the major shareholder, converted
£300,000 convertible loan notes ('CLNs') to 6,000,000 new Ordinary
Shares. The conversion price being 5
pence per share. This represented a premium of 85 per cent
to the closing price of 2.70 pence on
23 January 2023. On 29 September 2023, Golden Nice International
Group Limited, being the holder of the outstanding CLNs in the
Company, agreed to extend the redemption date by 18 months from
30 September 2023 to 31 March 2025, at a conversion price of
5 pence per share.
On 31 October 2023 the Company issued
a prospectus. This allowed the shares issued since 3 October 2022 to be listed. The shares were as
follows:
|
Number of Ordinary Shares immediately prior to
prospectus
|
25,789,714
|
|
Number of Ordinary Shares issued pursuant to the previously
announced subscriptions
|
25,726,000
|
|
Number of Ordinary Shares issued pursuant to the previously
announced conversions
|
13,373,141
|
|
Total number of Ordinary Shares in issue and listed on 31 October
2023
|
64,888,855
|
On 4 July 2023 the Company advanced
£200,000 to PL as part of its strategic pivot. The Company was of
the opinion that PL operated in a complementary sector and would
therefore assist the Company in expanding its activities into the
wider food and beverage sector. Post year-end, on 10 January 2024, the Company completed the
acquisition of PL which was announced on 18
December 2023. The acquisition price for 100% of PL, was
£500,000, to be settled by the issue of 12,500,000 new Ordinary
Shares at a value of 4 pence per
Ordinary Share, being a premium of 23.08 per cent, compared to the
closing middle market price of 3.25
pence per Ordinary Share on 15
December 2023. PL is a wine retailer consisting of 2 retail
liquor outlets in the Southeast of England. The Company would like to assist in
expanding the footprint and product range of PL.
Following the acquisition of PL, the Company and K2 Spice Limited
('K2') exercised the put and call option agreement which was
detailed in the previous Annual Financial Statements for the year
ended October 2022. This resulted in
the Company selling its remaining 51% holding in Dynamic Intertrade
(PTY) Ltd ('DI') in January 2024. I
would like to thank the team at DI. The Company currently has only
one subsidiary, although the results for DI have been fully
consolidated for the year ended October
2023.
The focus for 2024 will be the growth in the food and beverage
business via acquisition and joint ventures. The Company will be
looking for additional capital during the next financial year in
order to build up a war chest to allow it to acquire operating
assets. The additional funding available to PL following the
acquisition is expected to lead to growth due to development of new
sites and extending the product range.
We are looking forward to a busy year ahead. The
financial information set out below does not constitute the
Company's statutory accounts for the years ended 31 October 2022 or 2023 within the meaning of
Section 434 of the Companies Act 2006, but is derived from those
accounts. Statutory accounts for 2022 have been delivered to the
Registrar of Companies and those for 2023 will be delivered in due
course. The auditor’s report on the statutory accounts for the year
ended 31 October 2022 contained a
qualification in respect of inventory, as the auditor was appointed
after the year end and therefore could not attend the stock take,
as well as a material uncertainty in relation to going
concern.
The
auditor’s report on the statutory accounts for the year ended
31 October 2023 contained a material
uncertainty relating to going concern due to uncertainty inherent
in the Company meeting its forecasts and obtaining additional fund
raising. However, the Directors are of the opinion that the Group
will be able to undertake its planned activities for the period to
28 February 2025 from current cash
and debtor positions and have prepared the consolidated financial
statements on the going concern basis.
The
announcement has been prepared on the basis of the accounting
policies as stated in the financial statements for the year ended
31 October 2023. The information
included in this announcement is based on the Company's financial
statements which are prepared in accordance with International
Financial Reporting Standards ("IFRS"). The Company will publish
full financial statements that comply with IFRS on its website in
due course.
The annual
report and accounts for the year ended 31
October 2023 will be posted to shareholders in due course.
An announcement will be made regarding the posting of these
documents as appropriate.
Once
published, hard copies will be available to shareholders upon
request to the Company Secretary at 48
Chancery Lane, London WC2A 1JF,
and soft copies will be available for download and inspection from
the Company's website at
www.everestglobalplc.com.
The annual
report and accounts for the year ended 31
October 2023 will be made available from the FCA's National
Storage Mechanism at www.fca.org.uk/markets/primary-markets/regulatory-disclosures/national-storage-mechanism in
due course.
Further
the Company would like to update the market in relation to the
consideration shares to be paid in respect of the acquisition of
Precious Link (UK) Limited (“Precious Link”). On 10 January 2024. the Company announced that it
had completed its acquisition of Precious Link and had issued
12,500,000 new Ordinary Shares as consideration for the
acquisition. These shares have not yet been issued. The total
number of shares currently in issue therefore is 64,888,855 ,as
mentioned above, and this represents the total number of voting
rights in the Company. The Company will make a further announcement
updating the market as soon as it issues the new Ordinary Shares in
respect of the Precious Link acquisition. Once issued the total
voting rights will be 77,388,855.
This announcement contains inside information for the purposes of
Article 7 of EU Regulation 596/2014 (which forms part of domestic
UK law pursuant to the European Union (Withdrawal) Act
2018).
The
Directors of the Company take responsibility for the contents of
this announcement.
For
further information please contact the following:
Everest
Global plc
Andy Sui, Chief +44
(0) 776 775 1787
Executive
Officer
Rob Scott, Non-Executive Director
+27
(0)84 6006 001
Cairn
Financial Advisers LLP
Jo Turner / Emily
Staples +44
(0) 20 7213 0885 / +44 (0)20 7213 0897
Caution
regarding forward looking statements
Certain
statements in this announcement, are, or may be deemed to be,
forward looking statements. Forward looking statements are
identified by their use of terms and phrases such as ''believe'',
''could'', "should" ''envisage'', ''estimate'', ''intend'',
''may'', ''plan'', ''potentially'', "expect", ''will'' or the
negative of those, variations or comparable expressions, including
references to assumptions. These forward-looking statements are not
based on historical facts but rather on the Directors' current
expectations and assumptions regarding the Company's future growth,
results of operations, performance, future capital and other
expenditures (including the amount, nature and sources of funding
thereof), competitive advantages, business prospects and
opportunities. Such forward looking statements reflect the
Directors' current beliefs and assumptions and are based on
information currently available to the Directors.
Overview
The
objective
of
the
management
report
of
Everest
Global
Plc
('the
Company')
is
to
provide
sufficient
detailed
information to
both
shareholders
and
stakeholders
to
make
an
informed
decision
as
to
how
they
assess
how
the Directors have performed their duty, under section 172 of the
Act, to promote the success of the Company and
to provide context
for
the
related
financial statements as well
as assist
them
in
their decision
making.
The
duty
of a
director,
as
set
out
in
section 172 of
the
Act,
is
to
act in
the way
they consider,
in
good
faith, would be
most
likely
to
promote
the
success
of
the
Company
for
the
benefit of
its members,
and
in
so
doing
have regard,
amongst other
matters,
to:
-
the
likely
consequences
of
any
decision
in
the
long
term;
-
the
interests
of
the
Company's
employees;
-
the
need
to
foster
the
Company's
business
relationships
with
suppliers,
customers
and
others;
-
the
impact
of
the
Company's
operations
on the
community
and
the
environment;
-
the
desirability
of
the
Company
maintaining
a
reputation
for
high
standards
of
business
conduct;
and
-
the
need
to
act
fairly
as
between
members
of
the
Company.
As
a Board
we consider
the wider
environment within
which we operate and
as such ensure that
we have
considered the impact of our decisions on key stakeholders. We also
ensure that we are aware of any significant changes
in
the market
or
the
external
environment, including
the
identification
of emerging
risks,
which can
be fed
into our strategy
discussions and our risk
management process.
The Board
considered its
strategic stakeholders
in the year
as
follows:
In
accordance
with
Section
414C
(11)
of
the
Companies
Act
2006,
the
Group
chooses to
report the
review
of
the business,
the outlook and the
risk and
uncertainties faced
by the
Company in
the principal
risks section
below. The Directors’
assessment of
the risks
faced by the Group
are set
out in
the specific subsidiary risks and
uncertainties
and
can
be found
below
in the
financial
statements.
Responsibility
statement
The
Directors,
whose
names
and functions are set
out
below
of
this annual
report and
accounts under
the sub-heading
‘Board of Directors’
with registered office located at 1st Floor,
48 Chancery
Lane, London WC2A
1JF,
accept
responsibility
for
the
information
contained
in
this
annual
report
and
accounts
for
the
year
ended 31 October
2023.
To
the
best
of
the
knowledge
of
the
Directors:
•
the
financial
statements are prepared
in accordance
with
the
applicable
set of
accounting standards, give a
true
and
fair
view
of
the
assets,
liabilities,
financial
position
and
profit
or
loss
of
Everest
Global Plc
and the undertakings
included in the consolidation
taken as a whole;
and
•
the
management
report
includes
a
fair
review
of
the
development
and
performance
of the
business and
the position
of
Everest
Global
Plc
and
the
undertakings
included
in
the
consolidation
taken
as
a whole,
together with
a
description
of
the
principal
risks
and
uncertainties
that
they
face.
Everest
Global Plc acknowledges that it is responsible for all
information drawn
up and
made public
in this
report and
accounts for
the
period
ended 31 October
2023.
Strategy
As
set out in the Company’s prospectus dated 31
October 2023, the Company recently extended its
acquisition strategy
to cover the
wider
food
and beverage industry
with a focus
on
the
beverage
distribution
and production sector in the UK and the rest of Europe. The Directors of the Company believe
that the
recently announced acquisition of Precious Link
(UK) Limited
('PL') will
provide an
entry into the beverage
industry and allow it
to access industry know-how and expertise. This follows the
£200,000
loan advance made to
PL
during
the financial
year. The
Company
believes
PL operates
in a
complementary
sector
and
the
acquisition will
pave
the
way
in
expanding
its
activities
into
the
wider
food
and
beverage
sector.
The
Company is focusing on additional acquisitions of businesses in the
beverage distribution and production sector in
the UK
and the rest
of
Europe.
The
Company’s
primary
objective
is
that
of
securing
the
best
possible
value
for
Shareholders,
consistent
with
achieving, over time, both capital growth and income for
Shareholders through developing profitability coupled with dividend
payments on a sustainable
basis.
Our
purpose
&
values
The
Company's purpose and values are the fundamental beliefs and
principles that guide our decision making and actions. These
shape
our
culture
and
promotes teamwork. They assist differentiation
although the values
are
generic.
These
core
principles
assist
us
to
stay true to
our vision.
The
Company's
purpose
and
values
is:
Chief
Executive
Officer's
statement
The
last
financial
year
has
been
very
rewarding
albeit
not
without
its
challenges.
With
that
said
we
consider
it
successful in terms of
achieving
what
we
set
out
to
achieve.
In
October 2022,
the Company
name was
changed to Everest Global
Plc and
a
new
board
was constituted.
The
new
board
has
integrated
well
and
is
working
particularly
well
together.
Much
was
achieved
in
the
past
12 months.
In
late
2022
our
existing
auditors
resigned
as
they
exited
the
Public
Interest
Entity
('PIE') audit
space
which
left the
business without an auditor. It took some time to appoint a PIE
registered auditor, with a false start
announced in December 2022.
Eventually
in April 2023 a
PIE
registered auditor, RPG Crouch
Chapman LLP
('RPGCC') was
appointed.
The
Annual
Financial
Statements
for October
2022
were
produced
and
lodged late
on 27
July 2023. Both Companies House and
the Financial
Conduct Authority ('FCA') were informed
of the
Company's situation. During this period the shares were suspended
by the FCA. On 4 August 2023 the
suspension was lifted.
New
shareholders
invested
in
the
Company
on
23
January
2023. 12,726,000
new
Ordinary
Shares
were
issued at
a
subscription
price
of
5.5
pence
per
share
raising
a
total
of
£699,930.
The
subscription
price
represented
a
premium
of
119
per
cent
to
the
closing
price
of
2.51
pence
on
19
January
2023.
Allied
to
this
on
25
January
2023 Golden
Nice
International
Group Limited, the major
shareholder,
converted
£300,000 convertible
loan
notes
('CLNs') to
6,000,000
new
Ordinary
Shares.
The
conversion
price
being
5
pence
per
share.
This
represented
a
premium
of
85
per
cent
to
the
closing
price
of
2.70
pence
on
23
January
2023.
On
29
September
2023,
Golden Nice
International
Group
Limited,
being
the
holder
of
the
outstanding
CLNs
in
the
Company,
agreed
to
extend
the
redemption
date
by
18
months
from
30
September
2023
to
31
March
2025,
at
a
conversion
price
of
5
pence per
share.
On
31
October
2023
the
Company
issued
a
prospectus.
This
allowed the
shares
issued
since
3
October
2022
to be listed.
The shares
were as
follows:
|
Number
of
Ordinary
Shares
immediately
prior
to
prospectus
|
25,789,714
|
|
Number
of
Ordinary
Shares
issued
pursuant
to
the
previously
announced
subscriptions
|
25,726,000
|
|
Number
of
Ordinary
Shares
issued
pursuant
to
the
previously
announced
conversions
|
13,373,141
|
|
Total
number
of
Ordinary
Shares
in
issue
and
listed
on
31
October
2023
|
64,888,855
|
On
4
July
2023
the
Company
advanced
£200,000 to
PL as
part
of
its
strategic
pivot.
The
Company
was
of
the
opinion that
PL
operated
in
a
complementary
sector
and
would
therefore
assist
the
Company
in
expanding
its
activities into the wider food and beverage sector. Post year-end,
on 10 January 2024, the Company
completed the
acquisition
of
PL
which
was
announced on
18
December
2023.
The
acquisition
price
for
100%
of PL,
was
£500,000,
to
be settled
by
the issue
of
12,500,000
new
Ordinary
Shares at
a
value
of
4
pence
per
Ordinary
Share,
being
a
premium
of
23.08
per
cent,
compared
to
the
closing
middle
market
price
of
3.25
pence per
Ordinary Share on 15 December 2023.
PL is a wine retailer consisting of 2 retail liquor outlets in the
Southeast of
England. The
Company
would like to
assist in
expanding the
footprint
and
product range
of
PL.
Following
the acquisition
of PL, the Company
and K2 Spice
Limited
('K2') exercised the put
and
call
option agreement which
was
detailed
in
the
previous
Annual
Financial Statements
for
the
year
ended
October 2022.
This
resulted
in
the
Company
selling
its
remaining
51%
holding
in
Dynamic
Intertrade
(PTY)
Ltd ('DI')
in
January 2024.
I would like to
thank the team at DI. The Company currently has only one
subsidiary,
although the results for
DI
have been
fully consolidated for the
year
ended
October 2023.
The
focus
for 2024
will
be the
growth
in the food
and beverage business
via acquisition
and joint
ventures.
The Company
will be looking
for additional
capital during the next
financial
year in
order
to
build
up a
war
chest to
allow
it
to
acquire
operating
assets.
The
additional
funding
available
to
PL
following
the
acquisition
is
expected to
lead
to
growth
due
to
development
of
new
sites
and
extending
the
product
range.
We
are
looking
forward
to
a
busy
year
ahead.
.............................
Xin
(Andy)
Sui
Chief
Executive
Officer
Date:
26
February
2024
Financial
review
As
stated
above,
DI
was
fully
disposed
of
in
January
2024.
DI
is
involved
in
the
importation,
milling, blending,
and packaging
of
products
that
include
herbs,
spices,
seasonings
and
confectionery
for
the
domestic
market.
DI
achieved
an increase
in revenue
during
the
year
under
review
of
64.33%
(2022:
20.98%)
to
£2.792
million (2022:
£1.699
million).
In
DI's local
currency
of South
African Rand
turnover
increased
from
R34.8
million
to
R60.8 million – a 74.71% increase. This was as a result of across
the board increases in sales to existing customers and a
handful
of new customers.
Product mix
was
similar to previous years and gross
margins
improved
from
22.8%
in
2022
to
24.6%
during
the
year
under
review.
Gross
profits
for
the
Group
increased
by
63.58%
to
£687,635
(2022:
£420,358).
Group
operating
losses
for
the
year
decreased
to
£721,902 (2022:
£1,152,170). Total
Group comprehensive
loss amounted to £887,038 (2022: £4,570,562). The 2022 loss was
after incurring a finance charge on consolidation, resulting from
the assignment
of
the
loans
to K2, of £3.1
million.
Basic
and
diluted
loss
per
share
from
continuing
operations
for
the
year
was
1.71p
(2022:17.79p).
As
at
31
October
2023
the
Group
held
£858,024
(2022:
£925,814)
in
cash
and
cash
equivalents.
Financing
and
capital
structure
During
the
year
under
review,
the
Company
issued
12,726,000
new
Ordinary
Shares
at
a
subscription
price
of 5.5
pence per share raising a total of £699,930. Golden Nice
International Group Limited, the major
shareholder,
converted
£300,000
CLNs
to
6,000,000
new Ordinary
Shares
at
a conversion
price of
5
pence
per share.
In
the
year
ended
31
October
2022,
the
Company
assigned
certain
debts,
which
amounted
to £4,174,538,
that
were
due
by
DI
to
K2.
The
Group
uses warrants and CLNs to provide cash
liquidity that allows
the
Directors
to
pursue investment
opportunities. More
details
of
the
Company's
financial
instruments
are
at
note
29
of
our
financial
statements.
Acquisition
strategy
The
Company
will be actively
looking for new
acquisitions to
bolster its
operations and
will as
a result
in
all
likelihood seek to
raise more
capital
by way of both
debt and
equity.
Key
performance
indicators
('KPI')
|
|
Year
ended
31
October
|
Year
ended
31
October
|
|
2023
£
|
2022
£
|
|
Turnover
|
2,791,695
|
1,698,839
|
|
Gross
profit
|
687,635
|
420,368
|
|
Cash
on
hand
and
in
bank
|
858,024
|
925,814
|
|
Underlying
operating
loss
|
(721,902)
|
(1,152,170)
|
The
Board
use
these
indicators
as
a
high
level
indication
of
how
the
Group
is
performing
and therefore
how
to
actively improve the
performance.
The
KPIs used are reflective of the business as at 31 October 2023 and therefore includes DI's
financial information. As a result
of
the acquisition
and subsequent disposal,
the KPIs
in future
years
will
reflect this
change in
the group.
Turnover
is
the income
for
the
Group
and therefore is
vital to enable the
Group
to continue with
its
current
business
model.
Turnover
in
2023
has
increased
by 64%,
which shows
the
business
is
growing
and
recovering from
the pandemic.
Gross
profit
is
an
indication
that
the
underlying
business is
profitable. This
is because
gross
profit
is
turnover
less any
direct
costs.
As
with
any
business,
growing
turnover
by
more
than
64%
is
a
good
sign
but
it
needs
to
be making
profit to
allow the
business
to grow and
reinvest in
itself or pay
out
to
its
shareholders. It
is
also
important
to
see
the
gross
profit
margin
remain
the
same.
In
2022
it
was
24.7%
and it
has
marginally
decreased to
24.6%.
This
reiterates
the
point
that
the
underlying
business
remains
profitable
and
with
good
margins.
As
a
Company
that
invests
in
companies,
having
cash
in
hand
is
invaluable
to
both
pay
for
ongoing
costs
but
also to
be
able
to
invest
in
new
businesses.
Investment
opportunities
can
arise
from
anywhere
and
by
having
adequate cash,
this allows the Group
to actively scour the
market
for
these
opportunities.
Finally,
operating
loss
takes
into
consideration
overheads
of
the
Group. This
can
include
impairment charges
and also
foreign exchange difference
as
a
result
of
currency
moving
between
South
African Rand
and British
Pound. Given the Group
lost £722k
is not a
direct
indication
of poor performance
as
we pivot
the
business
from a
South
African
focus
to
a
European
focus
with
retail
footprint
rather
than
manufacturing.
We
would
hope
to
see
improvements
in
these
KPIs
as
we
move
forward.
This isn't
going
to
occur
in
the
short
term as
we
purchase
businesses,
however
in
the
medium
to
long
term we
envisage
a
profitable
group
that is
growing its turnover and
producing cash.
Principal
risks
The
Directors
consider
the
following
risk
factors
to
be
of
relevance
to
the
Group’s
activities.
It
should be
noted that
the
list
is
not
exhaustive
and
that
other
risk
factors not
presently
known
or
currently
deemed
immaterial
may apply. The risk
factors are summarised
below:
|
i.
|
Failure
to identify
or
anticipate future
risks
|
Although
the
Directors
believe
that
the
Group’s
risk
management
procedures
are
adequate,
the
methods
used
to manage risk
may
not
identify
or
anticipate
current
or
future
risks
or
the
extent
of
future
exposures,
which
could
be
significantly
greater than
historical measures indicate.
|
|
ii.
|
The
Company
may
|
The
Company
intends
to
make
acquisitions
in
the
food
and
beverage
industry
with
|
|
|
be
unable
to
raise
|
a
focus
on
the
beverage
distribution
and
production
sector
in
the
UK
and
the
rest
of
|
|
|
funds
to
complete
|
Europe.
Although
the
Company
has
not
formally
identified
any
prospective
|
|
|
an
acquisition
or
|
targets,
save
for
what
is
mentioned
in
Events
Subsequent
to
Year
End,
it
cannot
|
|
|
fund
the
operations
|
currently
predict
the
amount
of
additional
capital
that
may
be
required.
|
|
|
of the target
|
|
|
|
business
if
it
does
|
|
|
|
not obtain
|
|
|
|
additional
funding
|
|
|
iii.
|
Food safety and
regulation
|
Ensuring
the
safety
and
quality
of
food
products
is
crucial
for
the
Group.
Contamination,
improper handling, storage or processing can lead
to
foodborne illnesses, product
recalls, legal
issues and
damage to
the
brand’s
reputation. Any
non-compliance with food safety regulations may adversely affect
the Group’s operations and /
or
result
in penalties,
fines, product
recalls and
potential closure
of the
business.
|
|
iv.
|
Ownership and
Reverse Takeover
risks
|
The
Company’s
next
acquisition
following
our
recent
purchase
of
PL
may
be
a
Reverse
Takeover.
If
an
acquisition is
made,
its
business
risk
will
be
concentrated
in a
single
target
until
the
Company
completes
an
additional acquisition,
if
it
chooses
to
do
so.
In
the
event
that
the
Company
acquires
less
than a
100
per
cent
interest
in a
particular
entity,
the
remaining
ownership
interest
will
be
held
by
third
parties
and the
subsequent management and control of such an entity may entail
risks associated with
multiple
owners
and
decision-makers.
In circumstances
where the
Company were to undertake a Reverse Takeover (or analogous
transaction) requiring the
eligibility
of
the
Company
to
be re-assessed,
the Company
would be
required
to
meet
the
minimum
market
capitalisation
requirement
of £30,000,000
to maintain
its
listing.
In
the
event
that
the
Company
is
unable
to
satisfy
the
minimum
market capitalisation requirement, the Company would be unable to
meet the eligibility requirements to maintain its listing and would
be required to de-list, meaning the shareholders of the Company
would hold shares in a non-trading
public company (assuming it would be unable to
secure a
listing or
quotation on another exchange).
|
|
v.
|
Reliance on key
customers
and key
suppliers
|
DI,
although
disposed
of,
generated
approximately 90
per
cent
of
its
revenues
in
the
year ended October 2023 from its top ten customers. This dominance
of a select few
customers
in any business has the potential
to force erosion
of prices and, by extension, profit margins.
Additionally, there is
the risk
that loss
of a key
customer and
inability
to
locate
an
alternative
buyer
for
that
proportion
of
product
could result in
a significant
decrease
in
revenue.
|
Specific
subsidiary
risks
&
uncertainties
|
i.
|
Sector
risk
|
The
agriculture
and
agri-processing
sectors
are
highly
competitive
markets
and
many
of the
competitors
will
have greater
financial and other resources
than the Company and
as
a
result
may
be
in
a
better
position
to
compete
for opportunities.
The development
of
these enterprises
involves significant uncertainties
and risks including unusual climatic conditions such as
drought,
improper use of pesticides,
availability of labour and seasonality of produce, any one of which
could result in security of supply, damage to, or destruction of
crops, environmental damage or pollution.
Each of these could have a
material adverse
impact on
the business, operations and financial performance of
the
Group. The
market price of agricultural products and crops is volatile and
affected by numerous factors which are beyond the Group’s
control. These
include international supply and demand, the level of consumer
product demand, international economic trends, currency exchange
rate fluctuations, the level of interest rates,
the
rate
of
inflation,
global
or regional
political events, as
well
as
a
range of other market forces. Sustained downward movements in
agricultural prices could
render less
economic,
or
un-economic,
any
development or
investing
activities to
be
undertaken
by the Group.
Certain
agricultural projects
involve
high
capital costs and associated risks. Unless such projects enjoy long
term returns, their profitability
will
be
uncertain
resulting
in
potentially
high
investment
risk.
|
|
ii.
|
Political and
regulatory
risk
|
African
countries
experience
varying
degrees
of
political
instability.
There
can
be
no
assurance
that political stability will persist in those countries where
the Group
may have
operations
going
forward.
In
the event
of
political
instability
or changes
in government policies in those countries where the Group may
operate, the operations and financial condition of
the
Group
could be adversely
affected.
|
|
iii.
|
Environmental
risks
and
hazards
|
All
phases
of
the
Group’s
operations
are
subject
to
environmental
regulation
in
the
areas
in
which it operates.
Environmental
legislation is evolving
in a manner that
may require
stricter
standards
and
enforcement, increased
fines and
penalties for
non-compliance, more stringent environmental assessments of
proposed projects
and
a
heightened
degree
of
responsibility
for
companies
and
their
officers,
Directors and employees.
There
is no assurance that existing or future environmental regulation
will not materially adversely
affect
the
Group’s
business,
financial
condition
and
results
of
operations. Environmental
hazards
may
exist
on
the
properties
on
which
the
Group
holds interests
that
are
unknown
to
the
Group
at
present.
The Board
manages
this
risk by
working
with
environmental consultants
and
by
engaging with
the relevant
governmental departments and other concerned
stakeholders.
|
Managing
risks
&
internal
controls
The
Company continually identifies the risks that could affect its
goals and operations. It assesses the likelihood and impact
of
each
risk, and prioritises them accordingly.
Internal
controls are
designed
and implemented to mitigate or
reduce
the
risks,
or
transfer
or
avoid
them
if possible. The Directors
monitor and
evaluate the
effectiveness and efficiency of the internal
controls, and identify any
gaps
or
weaknesses
as
well
as
review
and
update
the
internal
controls
periodically,
or
when
there
are significant
changes
in the business
environment or
objectives.
The
key
features of the Group’s
systems and internal controls have been
detailed
in risk
four of
the specific
subsidiary risks and uncertainties below.
Going
concern
&
viability
statement
The
Directors
have reviewed
the Group‘s
forecast financial
position for the 12
months following the Board
approval of
these
financial
statements. The
Group‘s business
activities, financial
standing, and
factors likely
to influence
its
future development,
performance,
and position
were reviewed
by the
Board.
Following
a full
analysis of the Company, the Directors have a reasonable
expectation that the Company has adequate resources to continue in
operational existence for the foreseeable future. For this reason,
the Directors continue to
adopt the
going
concern
basis in
preparing the
financial
statements.
During
the
year,
the Group
raised additional equity funding of £699,930 (2022:
£650,000) in
gross funding
through share subscriptions to
fund
working capital. In
addition,
the
Company converted £300,000
(2022: £581,951.52)
of
CLNs
into
new
ordinary
shares.
The
Directors
have prepared
cash flow forecasts.
These forecasts
consider operating
cash flows
and capital
expenditure requirements
for the
Company
as well as its
subsidiaries, available
working
capital
and forecast
expenditure, including overheads and other costs. The Directors are
of the opinion that the Group has sufficient working
capital
and that no additional funding is
required other than that what has
been raised. Based upon the Company’s
forecast, it has
sufficient cash
for the
foreseeable
future.
Based
on
the
results
of
this analysis,
the Directors
have a
reasonable
expectation
that
the
Group
will
be
able
to continue
in
operation
and
meet
its
obligations
as
they
fall
due
over
the
period
to
2025.
.............................
Xin
(Andy)
Sui
On
behalf
of
the
board
Date:
26
February
2024
Board
of
Directors
The
following
Directors
have
held
office
in
the
year:
Xin
(Andy)
Sui
-
Chief
Executive
Director
Andy
Sui
has
over
11
years
of
investment
banking
experience.
Andy
started
his career
at
Barclays
Capital
on
the trading desk. He eventually became Chief Risk Officer
(CRO)
at Union
Bank of
India (UK)
managing a
balance sheet
of
over
$1
billion
asset.
Andy
is
also
a
co-founder
of
London Capital
Homes
Ltd
managing
over
120 residential
properties
and
focusing
on
property
development
projects
in
the
North
of
England. Andy
has
a
Masters Degree from
the
London School of Economics (LSE) in Finance and a
number of
financial market
qualifications.
Robert
Scott
-
Non-Executive
Director
Robert
has
principal
responsibility
as
being
the
director
responsible
for
the
overview
of
the
management
of
DI, the
Group’s
spice manufacturing
business that
was
disposed
of post
year
end,
in
January 2024. He
has
over
30 years’
financial and investment management
experience
with
the last
twenty years specifically focussed on, executive
management,
finance, corporate
governance,
acquisitions
and investor
management.
Rob
is a
Chartered Accountant (CA(SA))
by
profession. He served as Country Manager for Lonrho
and has was the General Manager
of
Uramin’s
South
African
operations.
He
held
executive
and
senior
positions
with
a
number
of companies
across
a
number
of
countries
in
Southern
Africa.
He
has
been
involved
in
such
broad
industries
as mining,
food
manufacturing, hotels,
agriculture,
shipping, consumer
products and
construction
amongst others. Robert
has
been
a Director of
DI for 12 years
and is responsible for
setting the
strategy for DI with management and
ensuring implementation. He has
an intimate understanding
of its
day-to-day operations.
He has served on a number of other public and private Company
boards. Robert began his career and qualified with Deloitte South Africa after obtaining his
Certificate of Theory of Accounting (CTA) from the University of
Cape Town. Rob’s broad
understanding of finance, markets, acquisitions and corporate
governance will
greatly assist the
Group
in its growth
plans.
Simon
Grant-Rennick
-
Non-Executive
Director
Simon
graduated from Camborne School of Mines (BSc Hons
Mining
Engineering, ACSM) and has been actively involved in the
mining
and
metal trading industry
for over
40
years.
He
has also
been
active in the agriculture space
in
Southern Africa, from the
growing
of macadamia
nuts
to chillies and paprika,
amongst other crops
and
game
farming
with
his
own
game
farm.
Simon
has
served
as
chairman
and
executive
director
of various private and public companies in Australia, America and UK (LSE, ASX) over
various global industries in agriculture, mining, property and
technology.
Key
activities
of
the
board
during
the
year
Meetings
attended:
|
|
Xin
(Andy)
Sui
|
Robert Scott
|
Simon
Grant-Rennick
|
|
Board
meetings
|
31/31
|
31/31
|
31/31
|
|
Audit
Committee
meetings
|
2/2
|
2/2
|
2/2
|
|
Remuneration
Committee
meetings
|
1/1
|
1/1
|
1/1
|
Directors
duties
The
duties
and
responsibilities
of
the
Board
are:
•
To
promote
the
success
of
the
Company;
•
To
exercise
independent
judgement;
•
To
exercise
reasonable
care,
skill
and
diligence;
•
To
avoid
conflicts
of
interest;
•
Not
to
accept
benefits
from
third
parties;
and
•
To
declare
interests
in
transactions
or
arrangements.
Corporate
governance
As
a
company
with a Standard
Listing, the
Company
is
not required
to comply
with the
provisions
of
the UK
Corporate Governance Code published by the Financial Reporting
Council. Nevertheless, the Directors are committed to maintaining
high standards of corporate governance and, so far
as
is practicable given the Group’s size
and nature,
adopts and
complies with
the
ǪCA
Corporate Governance
Code 2023
('ǪCA Code')
on a comply
or explain
basis. A
copy
of the
ǪCA
Code
is
publicly
available at
https://www.theqca.com.
The
Company
does depart from
the ǪCA
Code. This
isn't the
intention
of
the Board
but is
circumstantial for
the Company.
The
complexity
of
the
Board's
needs
remain limited and therefore
the
size
of
the
board has
matched the
needs of
the
Company.
It
is
hoped that
as the
Company progresses
through its
current cycle
of investments,
it will
grow in
both revenue and
market capitalisation.
With a bigger and
more complex
Company the Board will
need
to
grow.
This
will
provide
greater
governance
with the
addition
of
a chairperson,
more independent
Non- Executive
Directors, the formation of a stand alone nomination
committee and
well as other committees
being formed
of individuals
rather
than
the entire
Board.
|
Principle
1.
|
|
The
Company
is
a
holding
company.
Its
subsidiary,
which
makes
up
the
group
with
the Company (‘the Group’), is a businesses involved in the
production of food, agriculture and agricultural related products
and more recently the wider food and beverage industry. The
Company's strategy is to acquire profitable businesses within the
sector and leverage existing management and the Company’s ability
to access capital and new talent.
|
|
Establish
a
purpose,
strategy and
business
model which
promotes long-
term value for
shareholders.
|
The
Company’s
strategy
for
growth
is
to:
•
Acquire
profitable
businesses
within
the
sectors
we
operate;
•
Leverage
the internal skills that is has and where necessary bring in the
appropriate skills;
•
Ensure
the
underlying
business has access to sufficient growth
capital while being aware
of
the
actual
cost
of
capital
and
the
returns
that
are
required
to
be
generated; and
|
|
|
•
Create
a
company
that engages
all our people
with a common set of values and goals.
|
|
|
Our
can-do
culture
feeds
into
our
strategy,
which
is
being
pursued
both
organically
and, as opportunities arise, by relevant acquisitions.
|
Board
diversity
The
Company
is
dedicated
to
promoting
equal
opportunities
for
all
employees
and
job
applicants.
We
aim to
create
an
environment
that
is
free
from
discrimination and
harassment,
where cultural
diversity
and
individual differences
are
positively
valued
and
decisions
are
based
on
merit.
We
do
not
discriminate
against
employees
on
the
basis
of
age,
disability,
gender
reassignment,
gender
identity,
marital
or civil
partner status,
pregnancy or
maternity,
race,
colour,
nationality,
ethnic
or
national
origin,
religion
or
belief,
sex
or
sexual
orientation.
As
at 31
October
2023,
being
the reporting
date, the Company
had only three
Board
members
of which all were men
and
only
one has
an ethnic origin
other than
white British.
As such
the Company
has not
met
the
targets specified under the Listing Rules of having women make up
40 per cent
of the
Board or having a
woman in
at
least
one
of
the
following
senior
positions
on
its
Board:
(A)
the
chair;
(B)
the
Chief
Executive;
(C)
the senior independent director;
and (D) the chief
financial officer. However the
Company does have one
Board member
from
an
Asian background meaning that it
does
meet the
target
of
having
at least
one
Board
member from
a minority
ethnic background.
The
Company has not met the diversity expectation of a standard listed
company on the London Stock Exchange. This is because
Board
doesn't comprise
of any women, however, our subsidiary
company, DI, does have a female board member. The Board currently
views its size as adequate for the needs of the Company. As
the Company's
needs grow the
Board
will also grow which
will provide the
ability
to create a
diverse team
of Directors.
As
part of
our starting
form for staff
there are
a number
of questions that perform
dual
purposes for both
commercial
needs
as
well as
financial reporting
needs.
Of
these
questions
we
have
been able
to use:
what
sex do
you identify as; and what ethnic
background
do
you come
from.
Both
of these
questions
are
deemed
to
be self
reporting
as
each
member of
staff
undertakes
the
questions
by
themselves.
Gender
identity
or
sex 
Task
Force
on
Climate-related
Financial
Disclosures
(TCFD)
The
Company operates in an environment that renders our exposure to
climate-related risks minimal, therefore, the Company
has not included
in this annual report and financial statement the
climate related
financial disclosures
consistent
with the
TCFD Recommendations
and Recommended
Disclosures. However, our commitment
is
unwavering towards comprehending our environmental
footprint and
crafting sustainability strategies over the future relative to our
operational size. While limited in its environmental
impact, our operational ethos is underscored by a proactive
approach
to environmental stewardship. We detail the eleven TCFD
recommendation below.
The
Company
intends to comply with the TCFD
recommendations within the next
12-24
months.
As
part of
this we
will
review
our
new
investments
and
see how
they
can
provide
accurate
information
to
the
Company
to enable this
reporting.
Governance
Strategy
Risk
management
Metrics
&
targets
The
Company is deeply committed to a sustainable future and will
continuously assess its
environmental impact and
adopt strategies
to minimise its
carbon emissions.
Remuneration
Committee
report
Remuneration
Committee
terms
of
reference
The
Remuneration Committee has responsibility, subject to any necessary
Shareholder approval,
for the
determination of the terms and conditions of employment,
remuneration and benefits of the Executive Directors and certain
other senior
executives,
including pension rights and any compensation payments.
It also recommends and monitors the level and structure
of
remuneration for senior management
and the implementation of share option or other performance-related
schemes. It is
the aim
of the committee to
remunerate Executive Directors competitively and to reward
performance. The Remuneration Committee determines the Company's
policy for the remuneration of Executive Directors, having regard
to the ǪCA Corporate Governance
Code
2023.
The
Remuneration Committee meets at least twice a year. However, due to
the structure of
the business
currently the
meeting
was
combined
into
a
board
meeting
as
all
the
members
are
the
same
as
the
Board.
The
responsibilities of
the
committee
covered
in
its
terms of
reference include
determining
and
monitoring
policy
on and setting levels of remuneration, termination,
performance-related pay, pension arrangements, reporting
and
disclosure,
share
incentive
plans
and
the
appointment
of
remuneration
consultants.
The
terms
of reference also set out the reporting responsibilities and the
authority of the committee
to carry out its
responsibilities.
Directors’
remuneration,
shareholding
and
options
Remuneration
The
Directors’
remuneration for the
year
ended 31 October 2023
is set out in
the
table
below. None of the
Directors receive
share
options,
long
term
incentives,
bonus
schemes
or
the
like
as
part
of
their
remuneration
packages. Some Directors receive monthly fees as invoiced for
consultancy work as agreed between the Directors
and the
Remuneration
Committee. There
are
contracts
for
the
Directors.
No
pension
contributions
were
made
by
the
Company
on
behalf
of its
Directors other
than
for
Andrew
Monk.
Andrew Monk’s
pension
contribution for 2023
Nil
(2022:
£330).
At
the
year-end
a
total
of
£2,810
(2022:
£33,587)
was
outstanding
in
respect
of
Directors’
emoluments.
Shareholding
As
at
31
October
2023,
the
Directors
of
the
Company
held
the
following
shares:
number
of
Ordinary
Shares
in
issue
on
31
October
2023
-
64,888,855
**
Total
number
of
Ordinary
Shares
in
issue
on
31
October
2022
-
46,162,855
***
Shares
are
held
Vidacos
Nominees
Ltd
as
nominee
Xin
(Andy)
Sui
and
Simon
Grant-Rennick
do
not
have
any
shares
in
the
Company.
Options
There
is
no
Option
Scheme
in
place
at
the
Company
and
no
options
have
been
issued
to
any
of
the Directors.
All options issued previously have expired.
Warrants
As
at
31
October
2023
the
warrants
held
by Directors
were:
|
Warrant
holder
|
5p
warrants
|
5p
warrants
|
|
|
2023
|
2022
|
|
Robert
Scott
|
-
|
820,000
|
|
Andrew
Monk
*
|
-
|
4,240,000
|
|
Matt
Bonner
*
|
-
|
840,000
|
|
Total
|
-
|
5,900,000
|
*
These
directors
resigned
during
the
year
ended
31
October
2022
The
warrants
that were held by the Directors as
at 31
October 2022
expired on
23 March
2023. Due
to the
warrants lapsing
the
Directors
no
longer hold
any warrants within
the company.
Audit
Committee
report
Audit
Committee
terms of
reference
The
Audit
Committee
comprises
of
all
three
members
of
the
Board,
with
only
one
of
those
members
being
an
independent Non-Executive Director. The committee encompasses the
monitoring of risks posed to the Group on an ongoing basis, has
responsibility for, among other things, the monitoring of the
financial integrity of
the
Group’s
financial statements
and the
involvement
of
its auditors
in that
process.
It
focuses
in
particular on
compliance with
accounting policies and ensuring that
an
effective
system
of
internal financial
controls is maintained. The ultimate responsibility for reviewing
and approving the annual report and accounts and
the half-yearly
reports remains
with
the Board.
The
Audit
Committee
meets
no
less
than
twice
a
year
at
the
appropriate
times
in the
reporting
and
audit
cycle. It
also meets on an ‘as necessary’ basis. The responsibilities of the
committee covered in its terms of reference include
external
audit,
internal
audit,
financial
reporting
and
internal
controls.
Audit
Committee
report
I
am pleased to present the
2023 audit
report. As part of
the process
of preparing
a prospectus
the Board
conducted a review of the Company’s risk management. As the Company
pivoted its business model to a broader food and beverage business
we believed it was vital for us to conduct a new and thorough
understanding of how uncertainty
affects our business
objectives. While we had
a good
understanding of these effects
before, we now
have
a
significantly
improved focus and comprehension
of the risks
and this understanding enhances the Board's strategic thinking and
decision-making process. The new auditors settled
in
very
well
and
we
have
built
up
a
level
of
trust
with
them.
I believe
their
continued
input
will
be
very
helpful to the Company in reducing risk and enhancing internal
controls. Next year, we are looking to continue our work on risk
management, particularly focusing on identifying, assessing, and
mitigating potential risks
that
could
impact our
strategic
objectives.
I
am proud
of the
progress
we
have
made
over
the
past year and we as a Company remain committed to maintaining the
highest standards of corporate
governance.
.............................
Simon
Grant-Rennick
Chair
of
the
Audit
Committee
Date:
26
February
2024
Directors'
report
The
Directors
have
the
pleasure
of
submitting
their
report
and
the audited financial statements
for
the year
ended 31 October
2023.
To
make our annual
report and financial statements
more accessible,
a number
of
the
sections traditionally
found in this report can be found in other sections of this annual
report, where it is deemed that the information is
presented
in a more
connected
and accurate way.
Principal
Group
activities,
business
review
and
results
The
principal activity of
the Group in the
reporting year was
investing and
trading in
the
agriculture
and ancillary sectors
in
Africa.
The
business
review
and
results
can
be
found
above
in the
annual
report.
Statement
of
disclosure
to
auditors
Each
person
who
is
a
Director
at
the
date
of
approval
of
this
Annual
Report
confirms
that:
•
so
far as
the
Directors
are
aware,
there
is
no
relevant audit
information
of which
the Group
and Parent
Company's auditors are unaware;
•
the
Directors
have
taken
all
the
steps
they
ought
to
have
taken
as
Directors,
in
order
to
make
themselves aware
of
any
relevant
audit
information
and
to
establish
that
the
Group
and
Parent
Company's
auditors
are aware
of
that information,
and
•
each
Director
is
aware
of
and
concurs
with
the
information
included
in
the
management
report.
Statement
of
Directors'
responsibilities
The
Directors
are
responsible
for
preparing
the
Directors'
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 elected to
prepare the financial statements in
accordance
with
International
Financial Reporting
Standards
(IFRS)
as
adopted for
use
in the
United Kingdom. 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
Company
and
the
Group
and
of
the
profit
or
loss
of
the Company
and
the
Group 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
the
Group
and Parent Company
financial statements have ben prepared in
accordance with IFRS as adopted by the United Kingdom, subject to
any material departures disclosed and explained in the
Financial
Statements; and
•
prepare
the
financial
statements on the going
concern basis unless it is
inappropriate to
presume that
the Company will continue in business.
The
Directors
are
responsible
for
keeping
adequate accounting
records that
are
enough
to show
and
explain
the Group
and Parent Company's
transactions, disclose with
reasonable accuracy
at any
time the
financial
position of
the
Company
and
the
Group
and
enable
them
to
ensure
that
the
financial
statements
comply
with
the Companies
Act 2006.
The
Directors
are responsible
for
safeguarding
the assets
of the Group
and Parent Company
and hence for
taking reasonable
steps
for
the
prevention
and
detection
of
fraud
and
other
irregularities.
The
Directors are responsible for
the maintenance
and integrity of
the
corporate and
financial information included on the Group's
website.
Annual
general
meeting
('AGM')
Information
about
the
AGM
can
be
found
below.
Auditors
RPGCC,
has expressed its willingness to continue in
office and
a resolution
to reappoint following
the 2023
annual report
being
signed
will
be
proposed
at
the
next
annual
general
meeting.
Branches
outside
the
UK
Details
of
all
branches
outside
the
UK
can
be
found
below.
Corporate
governance
code
(the
'Code')
Information
on
how
the Company
applied
the
Principles and
complied with
the
provisions
of the
Code may
be found
above.
Dividends
No
dividends
will
be
distributed
for
the
current
year
(2022
-
nil).
Diversity
The
Group's
diversity
statistics
are
available
above.
Events
after
the
reporting
period
Further
information
on
events
after
the
reporting
date
are
set
out
in
note
32.
Employees
The
average
number
of
employees
and
their
remuneration
are
detailed
in
note
7.
Internal
control
and
risk
management
The
Group's
has
detailed out
its
internal
controls and
risk management
above. Additionally
its principle
risks are above.
Investing
policy
The
Company was established to invest in or acquire companies
engaged in the agriculture
and ancillary sectors in Africa. The Directors intend to use
their
collective experience
to identify appropriate investment
opportunities in the production, transportation and trading of food
and beverage products and ancillary
industries.
Indemnity
and
insurance
Details
of
Directors’
indemnity
and
insurance
is
located
below.
Political
donations
The
Group
made
no
political
donations
during
the
current
year
and
previous
financial period.
Nor has
it made
any contributions to
any non-UK political
party
during the
current
year
or
previous
financial
period.
Supplier
Payment
Policy
It
is
the
Group's
payment
policy
to
pay
its
suppliers
in conformance
with
industry
norms.
Trade
payables
are
paid in
a
timely
manner
within
contractual
terms,
which
is generally
30 to
45 days
from
the
date
an
invoice is
received.
Substantial
shareholders
The
Group
has been
informed of
the
shareholdings
that represent
3%
or
more
issued Ordinary Shares
of the
Company as at
31
October
2023.
A
full
list of
these
positions
can
be found
below.
Stakeholder
engagement
Details
regarding the engagement
with suppliers, customers and others in business relationships with
the Company may be found above.
Non-financial
reporting
Non-financial
measures are an important part of our business and we have
consistently recognised the importance of
non-financial
information
in
our
annual
report.
The
Board
is
committed to
acting
responsibility
and
working
with
our
stakeholders
to
manage
the
social
and
ethical
impact
of
our
activities.
We
aim
to
treat
all our
stakeholders
fairly
and
with
integrity,
as
we
explain
in
our
climate
related
financial
disclosures.
.............................
Xin
(Andy)
Sui
On
behalf
of
the
board
Date:
26
February
2024
Independent
auditor's
report
To
the
members
of
Everest
Global
Plc
Opinion
We
have audited the financial statements of Everest Global Plc
(the ‘Company’)
and its subsidiaries (the ‘Group’) for the year ended 31 October
2023 which comprise the Group and Company statements of
comprehensive income, statements of changes in equity, statements
of financial position, statements of cash flows
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
as
adopted
in
the United
Kingdom
(IFRS).
In
our
opinion,
the
financial
statements:
•
give
a
true
and
fair view
of
the
state
of
the
Group’s
and of
the
Company’s
affairs as
at 31
October
2023
and of
the
Group’s
loss
for
the
year
then
ended;
•
have
been
properly
prepared
in
accordance
with
IFRS;
and
•
have
been
prepared
in
accordance
with
the
requirements
of
the
Companies
Act
2006.
Basis
for
opinion
We
conducted our audit in accordance with International Standards on
Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities
under those standards are further described in the Auditor’s
responsibilities for the audit of the financial statements section
of our report. We are independent
of the Group 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
qualified
opinion.
Material
uncertainty
relating
to
going
concern
We
draw
attention
to
note 2a
in
the financial
statements, which
indicates events
or
conditions
identified
that
may cast
significant
doubt
over
the
Company’s
ability to continue as
a going
concern. As
stated in
note 2a,
these events
or
conditions,
along
with
other matters
set
forth
in note 2a,
indicate
that
a
material
uncertainty
exists that
may
cast
significant
doubt
on
the
Company’s
ability
to
continue
as
a
going
concern.
Our
opinion is
not modified in respect of this matter. In auditing the financial
statements, we have concluded that the Directors' use of the going
concern basis of accounting in the preparation of the financial
statements is
appropriate.
Our
evaluation of the Directors’
assessment of
the entity’s
ability to continue to
adopt the
going concern basis of accounting included:
•
review
budgets
and
cash
flows
projections
up
to
31
October
2025;
•
comparison
of
budget
to
past
performance;
•
sensitise
cash
flows
for
variations
in
trading
performance
and
working
capital
requirements;
•
consider
if
there
is
any
other
information
brought
to
light
during
the
audit
that
would
impact
on
the
going
concern assessment;
•
review
of
working
capital
facilities
and
assess
headroom
available
in
the
projections;
and
•
review
of
adequacy
and
completeness of
disclosures in
the financial
statements in
respect of
the going
concern assumption.
Our
responsibilities
and
the
responsibilities
of
the
Directors
with
respect to
going concern
are described
in the
relevant sections
of this report.
Our
approach
to
the
audit
In
planning our audit, we determined materiality and assessed the
risks of material misstatement in the
financial
statements.
In
particular,
we
looked at
where
the
Directors
made
subjective
judgements,
for
example in
respect of significant accounting estimates. As in all of our
audits, 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.
We
tailored
the
scope
of
our
audit
to
ensure
that
we
performed
sufficient
work
to
be
able
to
issue
an
opinion
on the financial statements as a whole, taking into account the
structure of the Group and the parent Company, the
accounting
processes and controls, and the industry
in which they operate.
We
performed the audit of the Company and reviewed the
work
performed by the component
auditor in
addition to performing our own
tests on the Company’s
subsidiary.
Key
audit
matters
Key
audit
matters
are
those
matters
that,
in
our
professional
judgement,
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
we
identified
(whether
or
not
due
to
fraud),
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.
The
matters
identified
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.
The
use
of
the Going
Concern
basis of accounting was
assessed as
a key
audit matter
and
has
already been
covered in
the previous
section
of
this
report.
The
other
key
audit
matter
identified
is
described
below.
Our
application
of
materiality
We
apply
the
concept
of
materiality
both
in
planning
and
performing
our
audit,
and
in
evaluating
the
effect
of
misstatements. We consider materiality
to be the magnitude by
which misstatements,
including omissions,
could influence the economic decisions of reasonable users that are
taken on the basis of the financial
statements.
In
order
to
reduce
to
an
appropriately
low
level
the
probability
that
any
misstatements
exceed
materiality,
we
use
a
lower
materiality
level,
performance
materiality,
to
determine the
extent of
testing
needed.
Importantly, misstatements
below
these
levels
will
not
necessarily
be
evaluated
as
immaterial
as
we
also take
account of
the nature
of
identified
misstatements,
and
the
particular
circumstances
of
their
occurrence,
when
evaluating
their effect
on
the financial
statements as a whole.
We
consider
gross assets to be the most significant determinant of
the
Group’s financial
performance used
by the users
of
the
financial
statements. We
have based
materiality on 2% of
gross assets
for each
of the
operating components.
Overall
materiality for the
Group
was therefore
set
at
£33,000.
For
each
component,
the materiality
set
was
lower
than
the
overall
group
materiality.
We
agreed
with the Audit
Committee
that
we would
report on
all differences in excess of 5%
of materiality
relating to the Group financial statements. We also
report to
the Audit
Committee on
financial statement disclosure matters identified when assessing
the overall consistency and presentation of the consolidated
financial statements.
Other
information
The
Directors are responsible for the other information. The other
information comprises the information
included in the annual report, other than the financial statements
and our auditor’s report thereon. Our opinion on
the
financial
statements
does not
cover
the
other
information
and,
except
to
the
extent
otherwise
explicitly stated in our report,
we do
not express
any form of assurance conclusion
thereon. 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
its environment
obtained
in
the
course
of
the
audit,
we
have
not
identified
material
misstatements
in
the
strategic
report
or
the Directors’
report.
We
have
nothing
to
report in
respect of
the
following
matters
in relation to
which the
Companies
Act 2006
requires us
to
report to
you if, in
our opinion:
•
adequate
accounting
records have not
been
kept 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;
•
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
set out on above, the Directors are responsible for
the
preparation
of
the
financial
statements
and
for
being
satisfied
that
they
give
a
true
and
fair
view, and for such internal control as the directors determine is
necessary to enable the preparation of financial
statements that
are
free
from
material
misstatement,
whether
due
to
fraud
or
error.
In
preparing
the financial
statements, the
Directors
are
responsible
for
assessing
the
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.
Those
charged with
governance
are
responsible
for
overseeing
the
Company's
financial reporting
process.
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 our opinion
in
an auditor’s
report.
Reasonable assurance is a high level of assurance, but does not
guarantee that an audit conducted in accordance with
IASs
(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 aggregate, they could reasonably be expected to influence
the
economic
decisions
of
users
taken
on the basis
of
the
financial
statements.
Irregularities,
including fraud, are instances of non-compliance with laws and
regulations. We design procedures in line with
our responsibilities,
outlined above, to detect material
misstatements in respect of
irregularities, including fraud. The extent to which our procedures
are capable of detecting irregularities, including fraud, is
detailed below:
•
We
obtained
an
understanding
of
the
legal
and
regulatory
frameworks
within
which the
Group
operates
focusing on those laws and regulations that have a direct effect on
the determination of material amounts and disclosures in the
financial statements.
•
We
identified
the
greatest
risk
of
material
impact
on
the
financial statements
from
irregularities,
including fraud,
to be the
override
of
controls by management. Our audit
procedures
to respond
to these
risks
included enquiries of management about their own identification and
assessment of the risks of irregularities, sample
testing
on
the
posting
of
journals
and
reviewing
accounting
estimates
for
biases.
Because
of
the
inherent
limitations
of
an
audit,
there
is
a
risk
that
we
will
not
detect
all
irregularities,
including
those leading
to
a
material
misstatement
in
the
financial
statements or
non-compliance
with
regulation.
This
risk increases
the
more
that
compliance
with
a
law
or
regulation
is
removed
from
the
events
and transactions
reflected in the financial statements, as we will be less likely to
become aware of instances of non- compliance. The
risk
is
also
greater
regarding
irregularities
occurring
due
to
fraud
rather
than
error,
as fraud
involves intentional concealment, forgery, collusion, omission
or misrepresentation.
A
further
description
of
our
responsibilities
for
the
audit
of
the
financial
statements
is
located
on
the
Financial
Reporting Council's website at:
www.frc.org.uk/auditorsresponsibilities. This
description forms part of our
Auditor's Report.
Other
matters
that
we
are
required
to
address
We
were
appointed
on
12
April
2023
and
this
is
the
second
year
of
our
engagement
as
auditors
for
the
Group.
We
confirm
that we
are
independent
of
the Group
and have
not
provided
any prohibited
non-audit services,
as defined
by the Ethical
Standard issued by the Financial
Reporting Council.
Our
audit
report
is
consistent with
our additional
report to
the Audit
Committee
explaining
the results
of our
audit.
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.
Statement
of
comprehensive
income 
Statement
of
financial
position As at 31 October 2023 
The
notes
form
part
of
these
financial
statements
The financial
statements
were
approved
and
authorised
for
issue
on
26
February
2024
by
the
board
of
directors
and
were
signed
on
its
behalf
by:
Company
Registration
No.
07913053
.............................
Xin
(Andy)
Sui
Director
Group
statement
of
changes
in
equity
For
the
year
ended
31
October
2023
Company
statement
of
changes
in
equity
For
the
year
ended
31
October
2023
Statement
of
cash
flows
For
the
year
ended
31
October
2023
Notes
to
the
group
annual
financial
statements For
the
year
ended
31
October
2023
1.
General
information
Everest
Global Plc is a company incorporated in the United Kingdom. Details
of the registered
office, the officers and advisers to the Company
are presented
on the directors
and professional advisers
page at the
back of
this
report.
The
Company
is
admitted
to
the
Official
List
(by
way
of
a
Standard
Listing
under
Chapter 14 of the Listing Rules) and to trading on the London Stock
Exchange's Main Market for listed securities. The
information
within
these
financial
statements
and
accompanying notes
has been
prepared
for
the year
ended
31
October
2023
with
comparatives
for
the
year
ended
31
October
2022.
2.
Basis
of
preparation
and
significant
accounting
policies
The
consolidated financial statements of Everest Global Plc have been
prepared in accordance with International Financial
Reporting
Standards
as
adopted
by the
United
Kingdom
(IFRS as
adopted
by
the UK),
IFRS Interpretations Committee
and
the Companies
Act
2006
applicable
to
companies reporting
under
IFRS.
The
consolidated
financial
statements
have
been
prepared
under
the
historical cost
convention in
the
Group's reporting currency of Pound Sterling.
The
preparation
of
financial
statements
in
conformity
with
IFRS 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
judgment or complexity, or areas where assumptions and estimates
are significant
to
the consolidated
financial statements are disclosed
in
Note 3.
The preparation
of financial
statements in
conformity with IFRS requires
management to
make judgments,
estimates and assumptions that affect the application of accounting
policies and reported amounts of assets, liabilities, income
and
expenses. Although these estimates
are based on management's
experience and knowledge
of
current
events
and
actions,
actual
results
may
ultimately differ from
these estimates.
The
estimates and underlying assumptions are reviewed on an ongoing
basis. Revisions to accounting
estimates
are
recognised
in
the
year
in
which
the
estimates
are
revised if
the
revision
affects
only
that
year
or
in the
year
of
the
revision
and
future
years
if
the
revision
affects
both
current
and
future
years.
a.
Going
concern
These
consolidated financial statements are prepared
on the going concern basis. The going concern basis assumes
that the
Group
will continue in
operation for the foreseeable
future and
will be able to
realise its assets and discharge its
liabilities and commitments in the normal
course of
business. The Group has incurred significant operating
losses and negative cash
flows
from operations as the Group
pivoted to new opportunities
during
the
year
under
review.
There
remains
an
active
and
liquid
market
for
the
Group's
shares.
As
at
31
October
2023
the
Group
held
£858,024
(2022:
£925,814)
in
cash
and
cash
equivalents.
As
disclosed
in note
32,
the
Group
has
acquired PL
and disposed
of DI
since the
year-end.
Furthermore,
the Group
continues
to
seek
further
investment opportunities
to develop
its
European-focused
food
and
beverage
operations.
It
will
be
necessary
to
raise
further
funding
to
achieve
these
objectives.
At
the
time
of approving
this
report,
negotiations
are
in
progress
to
raise
further
capital
in
the
form
of
CLNs.
The
Directors have prepared cash flow forecasts. These forecasts
consider operating cash flows and capital expenditure requirements
for the Company and PL, available working capital and forecast
expenditure, including overheads and other costs.
The Directors
are of
the opinion
that
the
Group has sufficient working
capital
and that no
additional funding is
required.
However,
funding
is
being
raised
to
provide adequate
cash
flow to
cover the
business
for unforeseen
costs that might
occur.
After
careful
consideration
of
the
matters
set
out
above,
the
Directors
are
of
the
opinion
that
the
Group will be
able
to
undertake
its
planned
activities
for
the
period
to
28
February
2025
from
current
cash
and
debtor positions
and have prepared the consolidated financial statements on the
going concern basis. Nevertheless, due to the uncertainties
inherent in meeting its forecasts and obtaining additional fund
raising there can be no certainty in these respects. The financial
statements do not include any adjustments that
would
result if
the Group
was unable to
continue as
a going
concern. For
this
reason,
the Directors
believe
that
there
is
a
material
uncertainty
relating
to
the
Group’s
going
concern.
b.
New
and
amended
standards
adopted
by
the
Company
The
Group
has
implemented IFRS
as adopted
by the
UK.
At
the
point
of
transition
from IFRS
as adopted
by the EU the underlying requirements were identical. The following
standards, amendments and
interpretations
are
new
and
effective
for
the
year
ended
31
October
2023
and
have been
adopted.
None
of the
IFRS
standards below
had
a material
impact on
the financial
statements.
The
following
new standards,
amendments to standards and interpretations have
been issued, but are
not effective
for
the
financial
year
beginning
1
November
2022
and
have
not
been
early
adopted:
The
Directors
anticipate
that
the
adoption
of these
standards
and
the interpretations
in
future
periods
will
not have
a
material
impact on
the financial
statements of the
Group.
c.
Basis
of
consolidation
The
consolidated
financial statements incorporate the
financial
statements of
the Company
and entities
controlled by
the
Company
(its
subsidiaries)
made
up
to
31
October
each
year.
Control
is
achieved
where
the Company
has the power
to
govern the financial
and operating policies of
an
investee
entity
so
as to
obtain benefits from its activities.
The
results of subsidiaries acquired or disposed of during the year are
included in the
consolidated statement of
comprehensive income
from
the effective
date
of
acquisition or up
to the effective
date
of
disposal, as appropriate. Where necessary, adjustments are made to
the financial statements of subsidiaries to
bring their accounting
policies into line with
those used
by other
members
of
the Group.
All intra-Group transactions, balances, income and
expenses are eliminated
on consolidation.
Non-controlling
interests
in
subsidiaries are
identified
separately from the Group's
equity
therein. Those
interests of
non-controlling shareholders that are
present
ownership
interests entitling
their holders
to a
proportionate share
of
net assets
upon liquidation may initially be measured
at fair
value
or
at
the
non-
controlling interests' proportionate share of
the fair
value of
the acquiree's
identifiable net
assets. The choice of measurement is made on an
acquisition-by-acquisition basis. Other non-controlling interests
are initially measured at fair value.
Subsequent to
acquisition, the carrying amount of non-controlling
interests is
the amount
of
those
interests
at
initial
recognition
plus
the
non-controlling
interests'
share of
subsequent changes
in equity.
Profit
or
loss
and each component of
other comprehensive
income
are
attributed
to the
owners
of the Company and to the non-controlling interests. Total
comprehensive income of the subsidiaries is attributed to
the owners
of the
Company
and to the non-controlling
interests even if this results in the non-controlling interests
having a deficit
balance.
Changes
in
the
Group's ownership
interests in
subsidiaries that
do not
result in
the
Group
losing control
over the subsidiaries are accounted for as equity transactions. The
carrying amounts of the Group's interests and
the
non-
controlling
interests
are
adjusted
to
reflect
the
changes
in
their relative
interests
in
the subsidiaries.
When
the
Group
loses
control
of
a
subsidiary,
the
profit
or
loss
on
disposal is
calculated
as
the
difference
between (i)
the
aggregate
of
the
fair
value
of
the
consideration
received
and
the
fair
value
of
any
retained
interest and (ii) the previous carrying amount of the assets
(including goodwill), and liabilities of the subsidiary and any
non-controlling interests. Where certain assets of the subsidiary
are measured at revalued amounts or fair values
and the related cumulative gain or loss has been recognised in
other comprehensive income and accumulated in equity, the amounts
previously recognised in other comprehensive income and accumulated
in equity are accounted for as if the Company
had directly
disposed
of
the
related
assets
(i.e.
reclassified
to
profit
or
loss
or
transferred
directly
to
retained
earnings). The
fair value of any investment retained in the former subsidiary at
the date when control is lost is
regarded as the fair value on initial recognition for subsequent
accounting under IFRS 9 "Financial Instruments: Recognition and
Measurement" or, when applicable, the cost on
initial recognition of an
investment in
an associate or
a
jointly
controlled entity.
Business
combinations
Acquisitions
of
businesses
are
accounted
for
using
the
acquisition
method.
The
consideration transferred
in a business
combination is measured at fair
value,
which is calculated as the sum
of the acquisition-
date fair values of the assets transferred by the
Group,
liabilities incurred
by the Group to the former
owners of the acquiree and the equity interests issued by the Group
in exchange for control of the acquiree. Acquisition-related
costs are
recognised
in profit or
loss
as
incurred.
At
the
acquisition
date,
the
identifiable
assets
acquired,
and the
liabilities
assumed
are recognised
at their
fair value
at
the
acquisition
date, except
that:
•
deferred
tax
assets
or
liabilities
and
liabilities
or
assets
related
to
employee benefit
arrangements
are
recognised and measured in accordance with IAS 12
Income
Taxes and
IAS 19 Employee Benefits
respectively;
•
liabilities
or equity instruments related to share-based payment transactions
of the acquiree
or the
replacement of an acquiree's share-based payment transactions with
share-based payment transactions of the Group are measured in
accordance with IFRS 2 Share-based Payment at the acquisition date;
and
•
assets
(or
disposal
groups) that are
classified
as held
for sale
in
accordance
with
IFRS
5 Non-current
Assets Held
for Sale
and
Discontinued Operations are
measured
in accordance with
that standard.
Goodwill
Goodwill
is
measured
as
the excess
of the
sum
of
the consideration
transferred,
the
amount
of
any non-
controlling interests
in
the acquiree,
and the fair
value
of
the
acquirer's
previously
held equity
interest in
the acquiree
(if
any) over the
net
of
the acquisition-date
amounts
of the
identifiable
assets
acquired and
the liabilities
assumed. If, after assessment,
the net
of
the acquisition-date
amounts of the identifiable
assets acquired
and
liabilities assumed
exceeds the
sum
of
the consideration
transferred,
the
amount
of
any non-controlling
interests
in
the
acquiree
and
the
fair
value
of
the
acquirer's
previously
held
interest
in
the acquiree
(if
any),
the
excess
is
recognised
immediately
in
profit
or
loss
as
a
bargain
purchase
gain.
Associates
The
Company's
interest
in
an associate is
carried in the statement
of
financial
position at
its
share
in
the
net assets
of the associate
together
with
goodwill paid on acquisition, less any impairment loss. When the
share in the losses exceeds the carrying amount of an
equity-accounted Company, the carrying amount is
written
down to nil and recognition of further
losses
is
discontinued.
d.
Property,
plant
&
equipment
Property,
plant and equipment are stated at historical cost less subsequent
accumulated depreciation and accumulated impairment losses, if any.
Historical cost includes expenditure that is directly
attributable to
the
acquisition
of
the
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.
All
other
repairs and
maintenance
are
charged
to
profit
or
loss
during
the
financial
year
in
which they
are incurred.
Depreciation on property, plant and
equipment is
calculated using the straight-line
method to write of
their cost
over
their
estimated
useful lives at
the
following
annual
rates:
Useful
lives
and
depreciation
method
are
reviewed
and
adjusted
if
appropriate,
at the
end of
each reporting year.
An
item of property, plant and equipment is derecognised upon disposal
or when
no future
economic benefits are
expected
to
arise
from
the
continued
use
of
the
asset.
Any
gain
or
loss
arising
on
the
disposal
or retirement
of
an
item of property,
plant and
equipment is
determined as the difference
between the sales proceeds
and
the
carrying
amount
of
the
relevant
asset
and
is
recognised
in
profit
or
loss
in
the
year
in which the asset
is
derecognised.
e.
Leased
assets
The
Group
leases
various
offices
and
equipment.
Rental
contracts
are
typically
made
for
fixed
periods
of
3
years but may have extension options for an additional 2 years.
Lease terms are negotiated on an individual basis
and
contain
a
wide
range
of
different
terms
and
conditions.
The
lease
agreements
do not
impose any
covenants, but leased
assets may not be
used
as security for borrowing
purposes.
The
right-of-use
asset
is
depreciated
over
the
shorter
of
the
asset's
useful
life
and
the
lease
term
as
per
the table
below:
|
First
year
of
the
lease
|
15.00%
|
|
Second
year
of
the
lease
|
17.00%
|
|
Third
year
of
the
lease
|
20.00%
|
|
Fourth
year
of
the
lease
|
22.00%
|
|
Fifth
year
of
the
lease
|
26.00%
|
Assets
and liabilities arising from a lease
are
initially
measured on a present
value
basis.
Lease liabilities
include the net present value of the following lease
payments:
•
fixed payments
(including
in-substance
fixed payments),
less
any
lease
incentives
receivable.
The
lease payments are discounted using the interest rate implicit in
the lease. If that rate
cannot be
determined, the
lessee's
incremental
borrowing
rate
is
used,
being
the rate
that
the
lessee
would
have
to
pay to
borrow
the
funds necessary
to
obtain
an
asset
of similar
value
in
a
similar
economic
environment
with similar terms
and conditions.
Right-of-use
assets
are
measured
at
cost
comprising
the
following:
•
the
amount
of
the
initial
measurement
of
lease
liability
•
any
lease payments
made at
or
before
the
commencement
date less
any
lease incentives received any initial direct costs,
and
•
restoration
costs.
Payments
associated
with short term
leases
and leases
of low-value
assets
are
recognised
on
a straight-
line basis
as
an expense in
profit or
loss.
Short-term leases
are leases
with a
lease
term
of 12
months
or
less. Low-value assets
comprise moving
equipment rented
on a day
to day basis.
f.
Investments
in
subsidiaries
Investments
in
subsidiaries
are
stated
at
cost
less,
where
appropriate,
provisions
for
impairment.
g.
Inventories
Inventories
are carried at the
lower of
cost and
net realisable
value. Cost is determined using specific identification and in
the case
of
work in progress and finished goods, comprises the
cost
of purchase, cost of conversion and other costs incurred in
bringing the inventories to their present location and condition.
Net realisable value is the estimated selling price in the ordinary
course of business less the estimated cost of completion and
applicable selling expenses.
When
the
inventories
are
sold,
the
carrying
amount
of
those
inventories
is
recognised as
an expense
in the year
in which the related revenue is recognised. The amount of any
write-down of inventories to net realisable value
and
all
losses
of
inventories
are
recognised
as an
expense in
the year
in
which
the write-
down or loss
occurs. The amount
of
any
reversal of any write-down of inventories
is recognised as an expense in
the year
in
which the reversal
occurs.
h.
Impairment
Non-derivative
financial
assets
Credit-impaired
financial
assets
At
each
reporting date, the Group
assesses whether financial
assets carried at amortised cost and debt securities
at
Fair
Value
through
Other Comprehensive
Income
('FVTOCI')
are credit-impaired.
A
financial
asset
is
"credit-impaired"
when
one
or
more
events
that
have
a
detrimental
impact
on the
estimated
future cash
flows of the financial
assets have occurred.
Evidence
that
a
financial
asset
is
credit-impaired
includes
the
following
observable
data:
•
significant
financial
difficulty
of
the
borrower
or
issuer;
•
a
breach
of
contract
such
as
a
default
or
being
more
than
90
days
past
due;
•
the
restructuring
of
a
loan
or
advance
by
the
Group
on
terms
that
the
Group
would
not
consider
•
it
is
probable
that
the
borrower
will
enter
bankruptcy
or
other
financial
reorganisation;
or
•
the
disappearance
of
an active
market
for
a
security because
of
financial
difficulties.
A
12
month
approach
is
followed
in
determining
the
Expected
Credit
Loss
('ECL').
Presentation
of
allowance
for
ECL
in
the
statement
of financial
position
Loss
allowances for financial
assets measured at amortised cost are deducted
from
the gross carrying amount of
the assets.
For
debt
securities
at FVTOCI,
the loss
allowance is
charged to profit or
loss
and is recognised in Other Comprehensive Income
('OCI').
Write-off
The
gross carrying amount of a financial asset is written off when the
Group has no reasonable
expectations
of
recovering
a
financial
asset
in
its
entirety
or
a
portion
thereof.
For
corporate
customers,
the Group
individually makes an assessment with
respect to
the timing
and amount of write-off based on whether there is a reasonable
expectation of recovery from the amount
written off. However, financial
assets that are written off could still be subject to enforcement
activities in order to comply with the Group's procedures of
recovery of the amounts
due.
i.
Financial
instruments
The
Group
classifies non-derivative financial
assets into the following
categories: loans and receivables and Fair
Value
through
Profit
and
Loss
('FVTPL')
and
Fair
Value
through
OCI
('FVTOCI')
financial
assets.
The
Group
classifies
non-derivative
financial liabilities
into
the
following
category:
other
financial liabilities.
-
Non-derivative
financial
assets
and
financial
liabilities
-
recognition
and
derecognition
The
Group
initially recognises loans
and
receivables on
the date
when
they are originated.
All other financial assets and financial liabilities are initially
recognised on the trade date when the entity becomes a
party
to the contractual
provisions of the instrument.
The
Group
derecognises
a
financial
asset
when
the
contractual
rights
to
the
cash
flows
from
the
asset
expire, or it transfers the rights to receive the contractual cash
flows in a transaction in which
substantially
all
of
the
risks
and
rewards
of
ownership
of
the
financial
asset
are
transferred,
or
it
neither transfers
nor
retains
substantially
all
of
the
risks
and
rewards
of
ownership
and
does
not
retain
control
over
the
transferred
asset.
Any
interest
in
such
derecognised
financial
assets
that is
created
or
retained by
the Group
is recognised
as a
separate
asset
or
liability.
The
Group derecognises a financial liability when it's contractual
obligations are discharged or cancelled or
expire.
Gains or losses
on derecognition of financial
liabilities are
recognised
in
profit or
loss as a finance
charge.
Financial
assets
and financial liabilities are offset,
and the net
amount
presented
in the
statement
of
financial position
when, and only when,
the Group
currently has
a
legally
enforceable right
to
offset
the amounts
and intends either to
settle them
on a net basis
or to
realise the
asset and
settle the
liability simultaneously.
-
Loans
and
receivables
-
measurement
These
assets are initially measured at fair value plus any directly
attributable transaction costs. Subsequent to initial recognition,
they are measured at amortised cost using the
effective interest
method.
-
Assets
at
FVTOCI
-
measurement
These
assets are initially measured at fair value plus any directly
attributable transaction costs. Subsequent to initial recognition,
they are measured at fair
value and
changes therein,
other than
impairment losses,
are
recognised
in OCI and accumulated in the revaluation
reserve.
When
these
assets
are
derecognised,
the gain
or loss
accumulated in
equity is
reclassified to
profit or
loss.
-
Non-derivative
financial
liabilities
-
measurement
Other
non-derivative
financial
liabilities
are
initially
measured
at fair
value less
any
directly
attributable transaction
costs. Subsequent to
initial recognition, these liabilities
are measured
at amortised cost using the effective
interest
method.
-
Convertible
loan notes
and
derivative
financial
instruments
The
presentation
and
measurement
of
loan
notes
for
accounting
purposes
is governed
by IAS
32 and
IFRS 9.
These
standards
require
the
loan
notes to
be separated
into
two components:
•
a
derivative
liability;
and
•
a
debt
host
liability.
This
is
because
the
loan
notes
are
convertible
into
an
unknown
number
of
shares,
therefore
failing
the
'fixed-for- fixed'
criterion
under IAS
32. This
requires the
'underlying option
component' of
the loan
note to
be
valued
first
(as
an
embedded
derivative),
with
the
residual
of
the
face
value
being
allocated
to the debt
host
liability
(refer financial
liabilities policy
above).
Compound
financial instruments issued by the Group comprise convertible
notes denominated in British pounds
that
can
be
converted
to
ordinary
shares
at
the
option
of
the
holder,
when
the
number
of shares
to
be
issued
is
fixed
and
does
not
vary
with
changes
in
fair
value.
The
liability
component
of
compound
financial
instruments
is
initially
recognised
at
the
fair value
of a
similar liability that does not have an equity conversion option.
The equity component is initially recognised at
the
difference
between
the
fair
value
of
the
compound
financial
instrument as
a whole
and the fair
value
of
the liability
component. Any
directly attributable
transaction
costs
are allocated
to the liability
and equity
components in
proportion to their initial
carrying
amounts.
Subsequent
to initial recognition, the liability component of a compound
financial instrument is measured at amortised cost using the
effective interest method. The equity component of a compound
financial instrument is
not remeasured.
Interest
related
to the financial
liability is recognised
in profit or
loss.
On
conversion at maturity,
the
financial liability is reclassified
to equity and no gain or loss
is
recognised.
The
Group's financial liabilities include amounts due to a director,
trade payables and accrued liabilities. These financial
liabilities are
classified as FVTPL are
stated at fair value
with any gains or
losses arising on re-measurement recognised in profit or loss.
Other financial liabilities, including borrowings
are
initially
measured at fair
value,
net
of
transaction
costs.
j.
Borrowings
Borrowings
are presented as current liabilities unless the Group has an
unconditional right to defer settlement for at least
12 months
after the
reporting period,
in which case they
are presented
as non-
current liabilities.
Borrowings
are initially recorded at fair
value, net
of transaction
costs and
subsequently carried for at
amortised costs using the effective interest method. Any difference
between the proceeds (net of transaction costs)
and
the
redemption
value
is
recognised
in
profit
or
loss
over
the
year
of
the
borrowings
using
the
effective
interest
method.
Borrowings
which
are
due
to
be settled
within
twelve
months
after
the reporting
period
are
included
in
current
borrowings
in
the
statement
of
financial
position
even
though
the
original term
was
for
a
period
longer
than
twelve
months
and
an
agreement
to
refinance,
or
to
reschedule
payments, on a long-term basis is completed after the reporting
period and before the financial statements are authorised
for issue.
k.
Revenue
recognition
Performance
obligations
and
service
recognition
policies
Revenue
is measured based on the consideration specified in a
contract with
a customer.
The Group
recognises revenue
when
it transfers
control
over of
goods
or
services
to
a customer.
The
following
table provides
information about the
nature
and
timing of
the satisfaction
of performance
obligations in contracts with customers, including significant
payment terms,
and the related revenue recognition policies.
l.
Cost
of
sales
Cost
of
sales
consists
of
all
costs
of
purchase
and
other
directly
incurred
costs.
Cost
of purchase comprises the purchase price, import duties and other
taxes (other than those subsequently recoverable
by the Group
from the taxing
authorities), if any,
and transport,
handling and
other costs
directly attributable to
the acquisition
of goods. Trade discounts,
rebates and other
similar
items are deducted
in determining the costs
of
purchase. Cost
of
conversion
primarily consists
of hiring
charges of subcontractors incurred during conversion.
m.
Finance
income
and
finance
costs
The
Group's
finance
income
and
finance
costs
include:
•
interest
income;
•
interest
expense;
and
•
dividend
income.
Interest
income
and
expense
is
recognised using
the effective
interest method.
Dividend income
is recognised in profit or
loss
on
the date
on
which the Group's
right
to
receive payment
is
established.
The
"effective
interest
rate"
is
the
rate
that
exactly
discounts
estimated
future
cash
payments
or
receipts
through the expected
life of
the
financial
instrument to:
•
the
gross
carrying
amount
of
the
financial
asset;
or
•
the
amortised
cost
of
the
financial
liability.
In
calculating interest income and expense, the effective interest
rate is applied to the gross carrying amount of the asset (when the
asset is not credit-impaired) or to the amortised cost of the
liability. However, for
financial
assets
that
have
become
credit-impaired
subsequent
to
initial
recognition, interest
income is
calculated
by
applying the effective
interest
rate
to
the amortised
cost of
the
financial
asset, if
the asset
is
no-longer
credit-impaired,
then
the calculation
of interest
income
reverts
to
the gross
basis.
n.
Taxation
Income
tax
expense
represents
the
sum
of
the
tax
currently
payable
and
deferred
tax.
The
tax
currently
payable is
based
on taxable profit
for
the
year.
Taxable
profit differs
from net profit as
reported in the statement
of
comprehensive income
because
it
excludes
items of income and 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 end
of the
reporting
year.
Deferred
tax
is
recognised
on
temporary
differences
between
the
carrying
amount
of
assets
and
liabilities
in the consolidated
financial statements and the corresponding tax bases used in the
computation of taxable profit.
Deferred
tax
liabilities
are
generally
recognised
for
all
taxable
temporary
differences.
Deferred
tax
assets
are
generally
recognised
for
all
deductible
temporary
differences
to
the
extent
that it
is probable
that
taxable
profits
will be available
against
which
those deductible
temporary
differences can
be utilised.
Such
deferred tax assets
and
liabilities are not
recognised if the temporary
differences
arise
from 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
profit.
Deferred
tax liabilities are recognised for taxable temporary differences
associated with
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
assets arising from
deductible temporary differences associated with such investments
are only recognised to the extent that
it
is
probable
that
there
will
be
sufficient
taxable
profits
against
which
to
utilise
the
benefits
of
the temporary
differences
and
they
are
expected
to
reverse
in
the
foreseeable
future.
The
carrying
amount
of
deferred
tax
assets
is
reviewed
at
the
end
of
each
reporting
year
and reduced
to the extent
that
it
is
no
longer
probable
that
sufficient
taxable
profits
will
be
available
to
allow
all
or
part
of
the
asset to
be recovered.
Deferred
tax
assets
and
liabilities
are
measured
at
the
tax
rates
that
are expected
to
apply
in
the
year in
which the liability
is settled
or the
asset
realised.
The
measurement
of
deferred
tax assets
and
liabilities reflects the
tax
consequences
that
would
follow
from
the
manner
in
which
the
Group
expects,
at
the
end
of the
reporting
year,
to
recover
or
settle
the
carrying
amount
of
its
assets
and
liabilities.
Current
or
deferred
tax
for
the
year
is
recognised
in
profit or
loss,
except
when
it relates
to
items
that
are
recognised
in
other
comprehensive
income
or
directly
in
equity,
in which case
the current
and
deferred
tax is
also
recognised
in other comprehensive
income
or
directly
in
equity respectively.
Where current
tax
or
deferred tax
arises
from
the
initial
accounting
for
a
business
combination, the
tax
effect
is
included
in
the
accounting for the
business
combination.
o.
Cash
&
cash
equivalents
Cash
and
cash
equivalents
comprise
cash at
bank and
on hand,
demand deposits
with banks
and other
financial institutions, and short-term, highly liquid investments
that are
readily convertible into known amounts of cash
and which are subject
to
an insignificant risk
of changes in value,
having been within three months of maturity at acquisition. Bank
overdrafts that are repayable on demand and form an integral part
of the Group's cash management are also included as a component of
cash and cash equivalents for the
purpose
of
the consolidated
statement of
cash flows.
p.
Provisions
and
contingencies
Provisions
are recognised
when the Group
has a present
obligation
as a result
of
a past
event,
and it is
probable
that
the
Group
will be
required to settle
that
obligation.
Provisions
are
measured at
the
Directors' best
estimate
of
the
expenditure
required
to
settle
the
obligation
at
the
statement
of
financial
position date and
are
discounted
to
present
value
where
the
effect
is
material.
Provisions are
not
recognised
for future
operating losses.
Where
there are a number of similar obligations, the likelihood that an
outflow will be required in settlement is
determined by considering the class
of obligations as a whole.
A provision is recognised even if
the
likelihood
of
an
outflow
with
respect
to
any
one
item
included
in
the
same
class
of
obligations
may be small.
When
the
effect
of
discounting is material, the amount
recognised
for a
provision
is
the present
value
at
the
reporting
date
of
the
future
expenditures
expected
to
be
required
to
settle the
obligation.
The
increase in
the discounted
present value
amount
arising
from the passage
of
time is
included
in finance
costs
in
the statement
of
comprehensive income.
Contingent
liabilities are not recognised in the financial statements. They
are disclosed unless the possibility of an outflow
of resources
embodying economic
benefits is
remote. A
contingent asset
is not
recognised in the financial
statements but disclosed
when an inflow of
economic
benefits
is probable.
q.
Share
capital
Ordinary
shares are classified as equity. Proceeds from issuance of ordinary
shares are classified as
equity.
Incremental
costs
directly attributable
to the
issuance
of
new
ordinary shares
are
deducted against share
capital
and share premium.
r.
Foreign
currencies
In
preparing
the
financial statements
of
each individual Group entity,
transactions
in currencies
other
than the
functional
currency
of
that
entity
(foreign
currencies)
are
recorded
in
the
respective
functional
currency (i.e.
the currency of the primary economic environment in which the
entity operates) at the rates of exchanges prevailing
on
the dates
of
the
transactions.
At
the
end
of the
reporting year,
monetary items
denominated
in
foreign
currencies
are
retranslated
at
the
rates
prevailing
at
that
date.
Non-monetary
items
carried
at
fair
value
that
are
denominated
in
foreign
currencies
are
retranslated at
the
rates
prevailing
on
the date
when
the fair
value
was
determined.
Non-monetary
items
that
are measured
in terms of historical
costs in
a foreign
currency are not
retranslated.
Exchange
differences
arising
on
the
settlement
of
monetary
items,
and
on
translation
of
monetary
items,
are recognised in profit or loss in the year in which they arise.
Exchange differences arising on the retranslation
of
non-
monetary
items
carried
at fair
value
are
included
in profit
or
loss
for
the
year
except
for
differences
arising
on
the
retranslation of
non-monetary items
in respect
of
which gains,
and
losses
are recognised
directly in other comprehensive income,
in which cases, the exchange differences
are also
recognised directly in other comprehensive
income.
For
the
purposes
of
presenting
the
consolidated
financial
statements,
assets
and
liabilities
of
the
Group's
foreign operations
are
translated
from South
African Rand
into the
presentation
currency
of the
Group
of
Pound Sterling at
the
rate
of
exchange
prevailing
at
the
end
of the
reporting
year,
and
their income and
expenses are translated at the average exchange rates for the year,
unless exchange rates fluctuate significantly during
that
year,
in
which
case,
the
exchange
rates
prevailing
at
the
dates
of
transactions
are
used. Exchange differences arising, if any, are recognised in other
comprehensive income and accumulated in equity.
The
principal
exchange
rates
during
the
year
are
set
out
in
the
table
below:
|
Rate
compared
to
£
(GBP)
|
|
Foreign
currency
|
For
the
year ending
31
October
2023
|
For
the
year ending
31
October
2022
|
|
South
African
Rand
|
22.6757
|
21.0410
|
|
US
Dollar
|
1.2154
|
1.1469
|
s.
Employee
benefits
Salaries,
annual bonuses, paid annual leave and the cost to
the Group
of non-monetary benefits are accrued in
the year
in
which employees of the
Group
render the
associated
services. Where
payment
or
settlement is
deferred
and
the
effect
would
be
material,
these
amounts
are
stated
at
their
present
values.
t.
Segmental
reporting
Operating
segments
are
reported
in
a
manner
consistent
with
the
internal
reporting
provided
to
the chief
operating decision
maker.
The
chief
operating
decision-maker,
who
is
responsible
for
allocating
resources
and assessing
performance
of
the
operating
segments,
has
been
identified
as
the
Executive
Director
who
makes strategic decisions.
3.
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.
In
the
application
of
the
Group's
accounting policies,
which are
described
above,
management is
required to
make estimates and assumptions about the
carrying amounts of assets and liabilities that are
not readily
apparent from
other
sources.
The
estimates
and
assumptions
that
had
a
significant
risk
of causing
a material
adjustment to
the carrying
amount of
assets
and liabilities are discussed
below.
a.
Inventory
valuation
Inventory
is
valued
at
the
lower
of
cost and
net
realisable
value.
Net
realisable
value
of
inventories
is the
estimated selling
price
in
the ordinary
course of
business,
less
estimated costs
of completion
and
selling
expenses. These estimates
are based
on the current
market
conditions and the
historical
experience
of
selling products of a similar
nature. It could change significantly as a result
of competitors' actions in response to severe industry cycles.
The Group
reviews its inventories in order to
identify slow-moving merchandise and
uses markdowns to clear merchandise.
Inventory value is
reduced when
the decision
to markdown below cost is
made.
b.
Impairment
of
long
term
inter-company
receivables
The
Group's
management
reviews
long-term
inter-company
receivables
on
a
regular
basis
to
determine
if
any provision for impairment is necessary. The policy for
the
impairment of
long-term inter-company receivables of the Group is based on, where
appropriate, the evaluation of collectability, the trading
performance of the relevant subsidiary and on management's
judgement. A considerable amount of
judgement is
required in assessing the ultimate
realisation
of these outstanding
amounts,
including the
current and
estimated
future
trading
performance
of
the
relevant
subsidiary.
If
the
financial
conditions
of
inter-company
debtors
of
the
Group
were
to
deteriorate,
resulting
in
an
impairment
of
their
ability
to
make payments,
a provision
for impairment
may
be required.
c.
Impairment
of
receivables
The
Group's management reviews receivables on a regular basis to
determine if any provision for impairment is
necessary. The policy
for the
impairment
of
receivables of the Group
is
based on,
where appropriate, the
evaluation
of
collectability
and
ageing analysis
of the
receivables
and
on managements'
judgement. A
considerable
amount
of
judgement
is
required
in
assessing
the
ultimate
realisation
of
these
outstanding amounts, including the current creditworthiness and the
past collection history of each debtor. If
the
financial
conditions of
debtors
of
the
Group
were
to
deteriorate,
resulting
in
an impairment
of their
ability
to make payments,
provision
for impairment
may
be required.
d.
Incremental
borrowing
cost
of
right
of
use
assets
and
lease
liabilities
In
assessing the Group's
right of
use assets
and lease
liabilities,
the
Group
has
to assess
its incremental
borrowing costs.
As an approximation of the Group's
incremental
long term
borrowing costs,
the Group
estimated
the
borrowing
costs
associated with similar
long
term,
asset
based financing
arrangements.
The Group
based
the
implied
incremental
borrowing
costs
on the
South African
prime
lending
rate applicable
at the
date
of
commencement of
the agreement
and
added
an appropriate
lending
premium
that would
be typically applied by lenders. At the year end the estimated
incremental borrowing costs used amounted to
8.5%
(2022:
8.5%).
e.
Income
taxes
The
Group is subject to
income taxes
in South Africa and
the UK.
The South
African income taxes are
administered
by South African accountants.
Significant
judgement
is
required in determining
the
provision for
income taxes and the timing of payment of the related tax. There
are certain transactions and calculations for
which
the
ultimate
tax
determination
is
uncertain
during
the
ordinary
course
of
business.
The Group
recognises
liabilities
for
anticipated
tax based
on estimates
of
whether
additional
taxes
will
be
due. Where the final tax outcome of these matters is different from
the amounts that were initially recorded, such
differences
will
impact
the
income
tax
provision
in
the
year
in
which
such
determination
is
made.
f.
Share
based
payments
The
fair
value
of
share-based payments recognised in the income
statement
is
measured by use of the Black Scholes model, which considers
conditions attached to the vesting and exercise of the equity
instruments. The
expected
life
used
in
the
model
is adjusted;
based on
management's
best
estimate,
for
the effects of non-transferability, exercise restrictions and
behavioural considerations. The
share price
volatility percentage factor used in the calculation is based on
management's best estimate
of future
share price behaviour based on past experience, future expectations
and benchmarked against peer companies in the industry.
g.
Equity
portion
of
convertible
loan
notes
The
Group
provides
for
the
equity
portion
of
convertible
loan
notes
by
applying
an
estimated
interest
rate
in determining
the
present
values
of
the
convertible
loan
notes
and
the
interest
payable
thereon
over
the
life of
the convertible
loan
notes.
h.
Depreciation
and
amortisation
The
Group depreciates property, plant and equipment and amortises the
leasehold buildings and land use rights
on
a
straight-line
method
over
the
estimated
useful
lives.
The estimated
useful
lives
reflect the
Directors' estimate
of
the
years
that
the
Group
intends
to
derive
future
economic
benefits
from
the
use
of
the Groups'
property, plant and
equipment.
4.
Segmental
reporting
In
the opinion
of the Directors,
the Group,
during the reporting
period has one class
of business,
being the
trading of agricultural materials. The Group's primary reporting
format is determined by the geographical segment according to
the location
of its
establishments. There is currently only one geographic
reporting
segment, which
is South
Africa. All
revenues
and
costs
are
derived
from
the
single
segment.
5.
Revenue 
6.
Other
income 
7.
Personnel
expenses
and
staff
numbers
8.
Directors'
remuneration
Group Company
|
For
the
year
|
For
the
year
|
For
the
year
|
For
the
year
|
|
ending
31
|
ending
31
|
ending
31
|
ending
31
|
|
October
|
October
|
October
|
October
|
|
2023
|
2022
|
2023
|
2022
|
|
Salaries
and
fees £
|
£
|
£
|
£
|
|
Xin
(Andy)
Sui
|
39,000
|
-
|
39,000
|
-
|
|
Robert
Scott
|
34,000
|
12,000
|
34,000
|
12,000
|
|
Simon
Grant-Rennick
|
50,260
|
-
|
50,260
|
-
|
|
Andrew
Monk
*
#
|
-
|
12,923
|
-
|
12,923
|
|
Matthew
Bonner
*
|
-
|
11,000
|
-
|
11,000
|
|
Total
|
123,260
|
35,923
|
123,260
|
35,923
|
*
These
directors
resigned
during
the
year
ended
31
October
2022
#
included
in
Andrew
Monk's
remuneration
is
£1,923
for
National
Insurance
contributions
No
pension contributions were made
by
the Company on behalf
of its
directors in
the current year.
Included in Andrew Monk's
2022
remuneration
are pension
contributions amounting
to
£330.
At
the
year-end
a
total
of
£2,810
(2022:
£33,587)
was
outstanding
in
respect
of
directors'
emoluments.
G. Expenses
-
analysis
by
nature
Admission
costs
included
£100,000
payable
to
RPGCC
with
respect
to
their
engagement
as
reporting
accountant.
10. Impairments
In
previous financial years, the recoverability of the investment was
evaluated and in management's estimation, it was considered
necessary to impair the goodwill on consolidation, the investment
in the subsidiary and the
intercompany
loans receivable.
They
are held
at
nil
value
in
the financial
statements.
Finance
costs
represent
interest
and
charges
in
respect of
the discounting
of invoices,
the interest
accrual
for
the Convertible
Loan
Notes issued
and the interest
charged
on capitalised right-of use
lease
liability.
Note
1:
These
finance
charges
relate
to
the
disposal
of
an
inter-company
loan
to
K2.
12.
Finance
income
13.
Taxation
The
charge for the year can be
reconciled to
the profit before
taxation per the consolidated
statement
of
comprehensive income
as
follows:
The
Company
has
excess
management
expenses
of
£1,585,329
(2022:
£1,432,899
)available
for
carry
forward
against
future
trading
profits.
The
deferred
tax
asset
in
these
tax
losses
at
19.0%
has
not
ben
recognised
due
to the
uncertainty
of recovery.
The
UK
government
changed
the
corporate
tax
with
effect
from
1
April
2023.
This
change
meant
there
was
a
sliding scale
between
19%
and
25%,
depending
on your
profits.
Given
the
Company
isn't profitable
we
have
applied the
rate
of
19%,
which
is
applicable
for
business
with
profits
less
than
£50,000.
14.
Loss
per
share
Loss
per
share
data
is
based
on the
Group
result for
the
year
and
the
weighted
average
number
of
shares
in
issue. Basic loss per share is calculated by dividing the loss
attributable to equity shareholders by the weighted
average
number
of
ordinary
shares
in
issue
during
the
year:
Basic
and
diluted loss per share
are
the
same,
since
where
a
loss
is
incurred the
effect
of
outstanding share
options and warrants is considered anti-dilutive and is ignored for
the purpose of the loss per share
calculation.
As
at
31
October
2023
there
were
50,488,839
(2022:
46,162,855)
shares
in issue,
63,089,171
(2022: 38,363,171)
outstanding
share
warrants
and
nil
(2022:
nil)
outstanding
options,
both
are
potentially
dilutive.
During
the
year,
DIA,
was
sold
to
the
proposed
purchaser
as
disclosed last
year.
It
had
been
anticipated
that
the sale be concluded within the last two financial year, however
COVID-19 delayed the process. The Company received
£15,385
for
its
investment
within
DIA.
This
was
greater
than
the
Directors
had estimated
while preparing
the
financial
statements
to
31 October
2022.
As
at
31
October
2023,
the
Company directly and
indirectly
held
the
following
investments:
The
reconciliation
of
non-controlling
interests
in
note
23
includes
an
analysis
of
the
profit
or
loss
allocated
to
non-controlling interests of each subsidiary where the
non-controlling interest is material. There are no
significant restrictions
on
the ability
of the
Group
to access or
use
assets
and
settle liabilities.
Subsequent
to
the
year
end
the
Company
has
disposed
of
its
remaining
holding
of
51%
of
DI
to
K2.
-
Property,
plant
&
equipment
|
|
|
17. Inventories
|
|
|
|
Group Year
ended
|
Year
ended
|
Company Year
ended
|
Year
ended
|
|
|
31
October
|
31
October
|
31
October
|
31
October
|
|
|
2023
£
|
2022
£
|
2023
£
|
2022
£
|
|
Raw
materials
|
329,408
|
175,875
|
-
|
-
|
|
Carrying
value
|
329,408
|
175,875
|
-
|
-
|
The
Group's
subsidiary
DI
entered
into
a
funding
agreement
with
Euro
2
Afrisko
Ltd
whereby
Euro
2
Afrisko
Ltd pays
the
suppliers
directly
and
this
is
then repaid
by DI
to purchase
stock
from
suppliers
where
deposits
are
required. This
funding
was
secured
by
a lien
over the
inventory
and a
cession
of the
debtors
balances.
|
18. Trade
and
other
receivables
|
|
|
|
Group Year
ended
|
Year
ended
|
Company Year
ended
|
Year
ended
|
|
|
31
October
|
31
October
|
31
October
|
31
October
|
|
|
2023
£
|
2022
£
|
2023
£
|
2022
£
|
|
Financial
instruments
Trade
receivables
|
282,671
|
256,824
|
-
|
-
|
|
Deposits
|
-
|
14,360
|
-
|
-
|
|
Loans
receivable
|
210,773
|
-
|
200,000
|
-
|
|
Other
receivables
|
42,726
|
11,219
|
42,726
|
11,219
|
|
Non-financial
instruments
Accrued
income
|
6,959
|
-
|
6,959
|
-
|
|
Prepayments
|
30,257
|
126
|
8,634
|
-
|
|
Carrying
value
|
573,386
|
282,529
|
258,319
|
11,219
|
|
Current
|
573,386
|
282,529
|
258,319
|
11,219
|
|
Non-current
|
-
|
-
|
-
|
-
|
573,386 282,529 258,319 11,219
The
Group's
subsidiary
DI
entered
into
a
funding
agreement
with
Euro
2
Afrisko
Ltd
whereby
Euro
2
Afrisko
Ltd pays
the
suppliers
directly
and
this
is
then repaid
by DI
to purchase
stock
from
suppliers
where
deposits
are
required. This
funding
was
secured
by
a lien
over the
inventory
and a
cession
of the
debtors
balances.
The
receivables are considered to be held within a held-to-collect
business model consistent with the Group's continuing recognition
of the receivables.
As
at
31
October
2023
the
Group
does not have
any
contract
assets
nor
any
contract
liabilities
arising
out of
contracts with
customers
relating to the Group's
right to
receive consideration
for agricultural
products sold
but not
billed.
Group
trade
receivables
represent
amounts
receivable
on
the
sale
of
agricultural
products
and
are included after provisions
for doubtful
debts.
Credit
and
market
risks,
and
impairment
loses
The
Group
did
not
impair
any
of
its
trade
receivables
as
at 31
October
2023,
as
all
trade receivables
generated during
the
financial
year, and
outstanding at
31 October
2023 are
considered to be
recoverable
during the
ordinary course of
business.
Information
about the Group's exposure to credit and market risks and
impairment losses for trade receivables is included in Note
29.
The
Directors
consider
that
the
carrying
amount
of
trade receivables
and
other
receivables
approximates
their fair
value.
|
19. Cash
and
cash
equivalents
|
|
|
|
Group Year
ended
|
Year
ended
|
Company Year
ended
|
Year
ended
|
|
|
31
October
|
31
October
|
31
October
|
31
October
|
|
|
2023
£
|
2022
£
|
2023
£
|
2022
£
|
|
Cash
on
hand
|
858,024
|
925,814
|
765,814
|
922,613
|
|
|
858,024
|
925,814
|
765,814
|
922,613
|
|
20. Trade
and
other
payables
|
|
|
|
Group Year
ended
|
Year
ended
|
Company Year
ended
|
Year
ended
|
|
|
31
October
|
31
October
|
31
October
|
31
October
|
|
|
2023
£
|
2022
£
|
2023
£
|
2022
£
|
|
Trade
payables
|
478,862
|
582,180
|
92,135
|
160,585
|
|
Other
payables
|
643,166
|
-
|
256,595
|
-
|
|
Related
party
payables
|
-
|
42,202
|
-
|
-
|
|
|
1,122,028
|
624,382
|
348,730
|
160,585
|
Trade
payables
represent
amounts
due
for
the
purchase
of
agricultural
materials
and
administrative
expenses. The
Directors
consider
that
the
carrying
amount
of
trade
payables
approximates
to
their
fair
value.
The
related
party
financial
liabilities
comprise:
Terms:
Matthew
Bonner
&
Robert
Scott:
The
loan
bears
interest
at
the
South
African
prime
overdraft
rate.
The
interest is
calculated and paid quarterly. The loan
is repayable as
decided upon from time to
time. The loans
were repaid in the year
21.
Share
capital
and
share
premium
Share
capital
is
the
amount
subscribed
for
shares
at
nominal
value.
During
the
2019
financial
year
the
Company
consolidated
all
existing
and
issued
shares
and
share
options
on
the basis
of
20
existing
shares/options
for
1
new
share/option.
Retained
losses
represent
the
cumulative
loss
of
the
Group
attributable
to
equity
shareholders.
Share-based
payments
reserve
relate
to
the
charge
for
share-based
payments
in
accordance
with
IFRS
2.
22.
Share
based
payments
reserve
The
Company
does
not
have
a
share-ownership
compensation
scheme
for
senior
executives
of
the
Company.
However
senior
executives
may
be
granted
options
to
purchase
Ordinary
Shares
in the
Company.
Warrants
During
the
2019
financial
year the
Company
consolidated all existing and issued
shares and
share options
on the basis
of
20
existing
shares/options
for
1
new
share/option.
There
are
63,089,171
warrants
to
subscribe
for
Ordinary
Shares
at
31
October
2023
(2022:
38,363,171).
Warrants
were
attached
to
the
CLNs issued
on 23
March 2021,
with an
exercise price
of 5.0p
per Ordinary
Share. The
redemption
date for
these
CLNs
is 31 March
2025.. These
warrants
will only
be issued
once the
CLNs are converted
into shares.
Warrants
were
attached
to
the
subscription
shares
issued
on
24
July 2020
a 1-for-1
basis, with
an
exercise
price of
5.0p
per ordinary
share and
expire 12
months from allotment of
the subscription
shares. Further warrants were attached to any new
ordinary
shares that
are issued
as a
result of
conversion of any loan notes, on
a 1-for-1
basis
on
the same
terms
as
the
subscription
warrants.
Warrants
were attached to the subscription shares issued on
14 September
2018 a
1-for-1 basis,
with an exercise price
of
20.0p
per ordinary
share and
expire 12
months
from allotment of
the
subscription
shares.
Further warrants
were
attached
to any new ordinary
shares that
are
issued
as a
result
of
conversion
of any
loan
notes,
on
a
1-for-1
basis
on
the
same
terms
as
the
subscription
warrants.
A
maximum
of
20,450,222
new ordinary
shares could potentially be issued in the event that all
subscription warrants and loan note warrants are
exercised.
On
3
October
2022
an
investor
subscribed
for
13,000,000
new
ordinary
shares
in
the
Company
at
a
price
of
5p per
share,
representing
a
capital
injection
of
£650,000
(gross
and
net)
into
the
Company.
The
new
ordinary
shares
were
accompanied
by
1
for
1
warrants
at
5p
in
the
Company's
ordinary
shares,
equating
to
13,000,000 warrants
exercisable
at
any
time
before
31
December
2024.
On
3 October 2022 the Company agreed with 35% of the CLN holders to
accelerate the conversion of 5,971,000 CLNs
and
accrued but unpaid
interest into
7,373,141 New
Ordinary
Shares
in
the
Company
at
a
conversion price
of
5p.
As
such,
the
conversion
of
5,971,000
CLNs
plus
accrued
but
unpaid
interest
resulted
in the
issue
of
7,373,141
5p
Warrants
and
7,373,141
10p
Warrants,
all
of
which
will
expire
on
31
December
2024.
On
19
January
2023
investors
subscribed
for
12,726,000
new
ordinary
shares
in
the
Company
at
a
price
of 5.5p
per share, representing a capital injection of £699,930 (gross and
net) into the Company. The new ordinary shares were
accompanied
by
1
for
1
warrants
at
5.5p
in
the
Company's
ordinary
shares,
equating
to
12,726,000
warrants
exercisable
at
any time
before
31
December
2024.
The
conversion
of
£300,000
of
CLNs
on
24
January
2023
has
created
6,000,000
new
shares
in
the
Company.
As per
the
terms
of
the
CLNs
on
conversion
each
share
also
gets
both
a
5p
and a
10p
warrant.
Therefore on
conversion 6,000,000
5p
warrants
and 6,000,000
10p
warrants
were issued
and are
exercisable
up
until 31
December 2024.
The
estimated
fair
value
of
the options
in issue
was calculated
by applying
the Black-Scholes
option pricing
model.
The
assumptions
used
in
the
calculation
were
as
follows:
|
Share
price
at
date
of
grant
|
0.03
|
|
Exercise
price
|
Being
the
exercise
price
as
stated
above
|
|
Expected
volatility
|
69%
|
|
Expected
dividend
|
0%
|
|
Contractual
life
(in years)
|
1.92
|
|
Risk
free
rate
(based
on
10
year
UK
Government
Gilts)
|
3.28%
|
|
Estimated
fair
value
of
each
option
|
0.004796
-
0.011232
|
Options
At
31
October
2023
there
were
nil
share options
issued to
the Directors
and past
directors
of
the
Company.
During the
current
year
nil
share
options
were
granted
(2022:
nil).
23.
Non-controlling
interests
Summarised
financial information in respect of each of the Group's
subsidiaries that has material non- controlling interests is set
out below. The summarised financial information below represents
amounts before intragroup
eliminations.
|
Dynamic
Intertrade
(Pty)
Ltd
|
2023
£
|
2022
£
|
|
Current
assets
|
736,685
|
451,450
|
|
Non-current
assets
|
181,900
|
264,330
|
|
Current
liabilities
|
(1,259,338)
|
(522,082)
|
|
Non-current
liabilities
|
(4,414,514)
|
(4,898,562)
|
|
|
(4,755,267)
|
(4,704,864)
|
|
Equity
attributable
to
the
owners
of
the
Company
|
(2,425,186)
|
(2,399,481)
|
|
Non-controlling
interests
|
(2,330,081)
|
(2,305,383)
|
|
|
(4,755,267)
|
(4,704,864)
|
|
Dynamic
Intertrade
(Pty)
Ltd
|
2023
£
|
2022
£
|
|
Revenue
|
2,791,695
|
1,698,839
|
|
Expenses
|
(3,138,683)
|
(2,615,612)
|
|
Loss
for
the
year
|
(346,988)
|
(916,773)
|
|
Loss
attributable
to
the
owners
of
the
Company
|
(346,988)
|
(916,773)
|
|
Loss
attributable
to
the
non-controlling
interests
|
-
|
-
|
|
Loss
for
the
year
|
(346,988)
|
(916,773)
|
|
Other
comprehensive
income
attributable
to
owners
of
the
Company
|
-
|
-
|
|
Other
comprehensive
income
attributable
to
the
non-controlling
interests
|
-
|
-
|
|
Other
comprehensive
income for
the
year
|
-
|
-
|
|
Total
comprehensive
income
attributable
to
owners
of
the
Company
|
(346,988)
|
(916,773)
|
|
Total
comprehensive
income
attributable
to
the
non-controlling
interests
|
-
|
-
|
|
Total
comprehensive
income
for
the
year
|
(346,988)
|
(916,773)
|
|
Net
cash
outflows
from
operating
activities
|
(314,591)
|
(786,055)
|
|
Net
cash
outflows
from
investing
activities
|
(22,290)
|
(4,415)
|
|
Net
cash
outflows
from
financing
activities
|
429,724
|
792,436
|
|
Net
cash
inflow
/
(outflow)
|
92,843
|
1,966
|
|
Non-controlling
interest
|
2023
£
|
2022
£
|
|
Balance
at
1
November
|
(2,305,383)
|
-
|
|
Equity
attributable
to
non-controlling
interest
on
disposal of
49%
interest
|
-
|
(2,305,905)
|
|
Share
of
profits
for
the
year
|
(24,698)
|
522
|
|
Balance
at
31
October
|
(2,330,081)
|
(2,305,383)
|
On
16 January 2024 K2 exercised the put and call option agreement
which was detailed in the Annual Financial Statements
for
the
year
ending
October
2022.
This
resulted
in the Company
selling its remaining
51% of
DI.
Full
details
of
this
transaction
can
be
found
in
the
subsequent
events,
at
note
32.
24.
Equity
portion
of
convertible
loan
notes
During
the
2021
financial
year,
on
23
March
2021,
the
Company
converted
£383,000
owed to
the
Directors
and a
Company
owned
by
a
director
for
7,660,000
CLNs
and,
simultaneously, issued
4,400,000
CLNs
to the
value of
£220,000
for
cash.
During
the current
financial
year the
Company
extended
the conversion
date of
the CLNs
to
31 December
2024.
The
equity
portion of the
CLNs
is
presented
below.
25.
Convertible
loan
notes
The
loan
notes
holder
will
be
paid
an
interest
rate
of
12
per
cent,
accrued
on
a
monthly
basis.
The
loan
notes
will not be
admitted
to trading on
any exchange.
On
31 March 2021, the Company issued 12,060,000 2021 Loan Notes in the
sum of £603,000 (by the conversion of existing
sums
due
to
creditors and
by
way of subscription
from private
investors).
On
3
October
2022,
Golden
Nice
acquired
£162,000
of
the
2018
Loan
Notes
and
£391,950
of
the
2021
Loan
Notes
from
various
holders,
being
65
per
cent.
of
the
Convertible
Loan
Notes
outstanding
at
that
time,
at
a
15 per
cent.
discount
to
their face
value
together
with
accrued but
unpaid
interest.
The
Company also agreed with the remaining holders of Convertible Loan
Notes to accelerate the conversion of the balance of £87,500 2018
Loan Notes and £211,050 2021 Loan Notes and
accrued but
unpaid
interest
into,
in
aggregate,
7,373,141
2022
Conversion
Shares
in
the
Company
at
a
conversion
price
of 5p.
In accordance with
their terms,
the Company
granted each holder one
warrant
to
subscribe
for
a new
Ordinary Share
at
an
exercise
price
of
£0.05
per
Ordinary
Share
for
every
2022
Conversion
Share
issued.
Additionally,
the Company
also agreed to grant each holder one warrant
to subscribe for a
new Ordinary
Share at
an
exercise
price
of
£0.10
per
Ordinary
Share for
every
2022
Conversion
Share
issued.
Accordingly,
the conversion
of
£87,500
2018
Loan
Notes
and
£211,050
2021
Loan
Notes
plus
accrued
but
unpaid
interest
resulted
in
the
granting
of
7,373,141
5p
2022
CLN
Warrants
and
7,373,141
10p
2022
CLN
Warrants.
On
or around
24 January
2023, the Company
received a conversion
notice from
Golden Nice, pursuant to
which Golden Nice
notified
the
Company
of
the conversion
of the
2021
Loan
Notes in
the aggregate
sum
of
£300,000
into
6,000,000
Ordinary
Shares
at
a
price
of
5
pence
per
share,
being
a
premium
of
25
per
cent
to
the
closing
price
of
3.75
pence
on
23
January
2023,
being
the
business
day
prior
to
agreement
of
the
conversion. As
part
of
the
2023
Conversion,
Golden
Nice
received
a
5p
2023
CLN
Warrant
and
a
10p
2023
CLN
Warrant
for every
Ordinary Share issued
in
connection with the 2023
Conversion.
A
maximum
of
32,510,222
New
Ordinary
Shares
could
potentially
be
issued
in
the
event
that
all
New
Ordinary
Shares Warrants
and
Loan
Conversion Warrants are
exercised.
The
fair
value
of
the
liability
component,
included
in
non-current
liabilities,
is
calculated
using
a
market
interest
rate
for
an
equivalent
non-convertible
loan
note
at
the
date
of
issue.
The
residual
amount,
representing the
value
of
the
equity
conversion component, is
included
in shareholder's equity
in Equity portion of convertible loan
notes (Note 25).
The
carrying amounts
of
the
liability component
of the
CLNs at
the balance
sheet date
are derived
as
follows:
As
part of the of 3 October 2022 investment agreement, the Company
agreed with the
CLN holders to accelerate the
conversion
of
5,971,000
CLNs
and
accrued
but
unpaid interest
into 7,373,141
new Ordinary
Shares in the Company
at a
conversion
price of
5p.
|
26. Borrowings
|
|
|
|
Group
|
Company
|
|
|
Year
ended Year
ended
|
Year
ended Year
ended
|
|
|
31
October 31
October
|
31
October 31
October
|
|
|
2023 2022
|
2023 2022
|
|
|
£ £
|
£ £
|
|
Euro
2
Afrisko
Ltd
-
inventory
financing
|
291,744
|
417,891
|
- -
|
|
Working
Capital
Partners
Pty
Ltd
-
accounts
|
71,267
|
140,063
|
-
|
-
|
|
receivable
financing
|
|
|
|
|
Loan
from
K2
Spice
Ltd
|
4,355,369
|
4,174,538
|
- -
|
|
Carrying
value
|
4,718,380
|
4,732,492
|
- -
|
The
Group's
subsidiary
DI
entered
into
a funding
agreement
with
Euro 2
Afrisko
Ltd
whereby
Euro
2 Afrisko
Ltd pays
the
suppliers
directly
and
this
is
then
repaid
by
DI
to
purchase
stock
from suppliers
where deposits
are required.
This
funding
was
then
repaid and secured by a lien over the inventory
and accession of the
debtors.
The
borrowings
were
secured
by
a
security
agreement from
the Company.
The loans
bear
interest
at 14%
per annum.
|
27. Leases
|
|
|
Right
of
use
asset and
lease
liability
|
|
|
Group
|
Company
|
|
|
Year
ended Year
ended
|
Year
ended Year
ended
|
|
|
31
October 31
October
|
31
October 31
October
|
|
|
2023 2022
|
2023 2022
|
|
|
£ £
|
£ £
|
|
Operating
lease
commitments
disclosed
as
at
31
|
266,555
|
347,102
|
-
|
-
|
|
October
|
|
|
|
|
Interest
payments
|
17,935
|
-
|
- -
|
|
Lease
payments
|
(89,704)
|
(73,234)
|
- -
|
|
Exchange
difference
|
(7,798)
|
(7,313)
|
- -
|
|
Lease
liability
recognised
in
the
statement
of
|
186,988
|
266,555
|
-
|
-
|
|
financial
position
|
|
|
|
|
Of
which:
|
|
|
|
|
Current
lease
liabilities
|
108,266
|
100,485
|
- -
|
|
Non-current
lease
liabilities
|
78,722
|
166,070
|
- -
|
|
|
186,988
|
266,555
|
- -
|
Right-of
use
assets
were
measured
at
the
amount
equal
to
the
lease
liability,
adjusted by
the
amount
of
any
prepaid or
accrued
lease
payments
relating
to
that
lease
recognised
in
the
statement
of
financial
position
as
at 31
October
2019.
There
were
no
onerous lease
contracts
that
would
have required
an adjustment to
the
right-of-use assets
at
the
date
of
initial
application.
The
recognised
right
of-use
assets
relate
to
the
following
types of assets:
Group Company
|
Year
ended
31
October
|
Year
ended
31
October
|
Year
ended
31
October
|
Year
ended
31
October
|
|
2023
|
2022
|
2023
|
2022
|
|
£
|
£
|
£
|
£
|
|
Properties
|
156,129
|
250,446
|
- -
|
|
|
156,129
|
250,446
|
- -
|
|
|
|
|
|
On
3 March
2020 a
new
lease
was
signed
for the
Group's main
trading
address,
104 Bofors
Circle, Epping
Industrial
2,
Cape
Town,
South
Africa
with commencement
date
of
1
July 2020.
On the
commencement
date, the
Group
recognised
a
lease
liability
and
right-of-use
asset
of
£430,973.
Impact
on
earnings
per
share
Depreciation
on
the
right-of-use
asset
amounting
to
£103,842
(2022:
£73,234)
and
interest
on
the
right-of-use lease
liability
of
£17,935
(2022:
£25,995)
were
charged
to
the
statement
of
profit
and
loss
for
the
current
year. As
a
result,
the
earnings
per
share
decreased
by
0.002p.
|
28. Notes
to
the
statement
of
cash
flows
|
|
29.
Financial
instruments
-
fair
values
and
risk
management
The
following
table shows
the carrying
amounts and fair values
of financial assets and financial liabilities, including
their
levels
in
the
fair
value
hierarchy.
It
does
not
include
fair
value
information
for
financial
assets
and financial
liabilities
not
measured
at
fair
value
if
the
carrying
amount
is
a
reasonable
approximation
of
fair
value.
Trade
and
other
receivables
and
trade and
other payables
classified as
held-for-sale are
not
included
in the
table below.
The
Group
has not disclosed
the fair
values
of financial instruments such as
short-term trade
receivables
and payables,
because
their
carrying
amounts
are
a
reasonable
approximation
of their
fair
value.
Group
as
at
31
October
2023
Company
as
at
31
October
2023
Company
as
at
31
October
2022
-
Measurement
of
fair
values
-
Valuation
techniques
and
significant
unobservable
inputs
The
following
tables show the
valuation
techniques used in measuring Level 3 fair
values
for financial
instruments measured at fair value in the statement of financial
position, as well as the significant unobservable
inputs
used. Related valuation processes are described
in Note 3.
Financial
instruments
measured
at
fair
value
|
Type
|
Valuation
technique
|
Significant unobservable
inputs
|
Inter-relationship between
significant
unobservable inputs
and fair value
measurement
|
|
Investment
in
associate
|
The
value
of
the
investment
is
adjusted annually based upon the group's
share
of
the
associate profit
or
loss.
|
None
|
None
|
-
Transfers
between
Levels
1
C
2
There
were
no
transfers between
levels 1
C
2
in
either the
current
financial
year
or
in
the prior financial
year.
C.
Financial
risk
management
The
Group
has
exposure
to
the
following
risks
arising
from
financial
instruments:
•
credit
risk;
•
liquidity
and
cash
flow
risk;
and
•
market
risk.
Risk
management
framework
The
Company's
Board of Directors
has overall
responsibility for
the
establishment
and oversight
of the
Group's risk management framework.
The
Group's risk management policies are established to identify and
analyse the
risks faced by the Group, to set appropriate risk
limits and controls and to monitor risks and adherence
to
limits. Risk management policies
and systems are reviewed
regularly to reflect changes
in market conditions and the Group's
activities.
The
Group's Audit Committee oversees how management monitors compliance
with the Group's risk management policies
and
procedures and reviews the adequacy
of the
risk
management
framework
in
relation to
the
risks
faced
by
the
Group.
The
Group's
Audit
Committee
undertakes
ad
hoc
reviews
of risk
management controls
and
procedures, the
results
of
which
are reported
to the Audit
Committee.
Credit
risk
Credit
risk
is
the
risk
of
financial
loss
to
the
Group
if
a
customer
or
counterparty
to
a
financial
instrument
fails to meet its contractual obligations and arises principally
from the Group's receivables from customers and investments in debt
securities.
The
carrying amounts of financial assets represent the maximum credit
exposure. There was no impairment loss
in
the current
year
nor
in
the prior
year.
Trade
receivables
The
Group's exposure to credit risk is influenced mainly by the
individual characteristics of each customer. However, management
also considers the factors that may
influence the
credit risk
of its customer base, including the default risk associated with
the industry and country in which its customers operate.
Details
of
concentration
of revenue
are
included
in Note 6.
The
Group
has established a credit policy under which
each
new customer
is
analysed
individually for
creditworthiness before the
Group's
standard payment terms
and conditions are offered.
The
Group's
review includes external ratings, if
they are
available, financial
statements, credit
agency information,
industry information
and
in
some
cases
bank
references. Sales
limits are
established
for
each
customer
and are reviewed
regularly.
The
Group
limits its exposure to
credit risk
from trade
receivables
by
establishing a
maximum
payment
period of one month.
The
Group
does
not
require
collateral in respect
of
trade
and other
receivables.
The
Group does
not
have trade
receivables
for which
a no
allowance is
recognised because of
collateral.
Expected
credit
loss assessment for corporate customers as
at
31 October
2023 and
31 October
2022
The
Group allocates each exposure to a credit risk grade based on data
that is determined to be predictive of
the
risk
of loss
(including but not
limited
to external
ratings, audited
financial statements,
management accounts and cash flow
projections and available press information about
customers) and applying experienced credit judgement. Credit risk
grades are defined using qualitative and quantitative
factors
that
are
indicative
of
the
risk
of
default.
Movements
in
the
allowance
for
impairment
in
respect
of
trade
receivables
The
movement
in
the
allowance
for
impairment
in
respect
of
trade
receivables
during the
year
amounted
to nil.
Cash
and
cash
equivalents
As
at
31
October
2023,
the
Group
held
£858,024
in
cash
and
cash
equivalents
(2022:
£925,814)
and
had
a bank
overdraft of £nil. The cash and cash equivalents are held with bank
and financial institution counterparties which
are
rated
Baa3
to
A1+
by
Moody's.
Impairment
on
cash and
cash equivalents
has been
measured on
a 12-month
expected loss
basis and
reflects the short
maturities
of the exposures.
The Group
considers that its
cash and cash equivalents
have low
credit
risk
based
on
the
external
credit
ratings
of
the
counterparties.
On
the
implementation
of
IFRS 9 the
Group
did not impair
any
of its
cash
and cash equivalents.
Liquidity
and
cash
flow
risk
Liquidity
risk
is
the
risk
that
the
Group
will
encounter
difficulty
in
meeting
the
obligations
associated
with
its financial
liabilities
that
are
settled
by
delivering
cash
or
another
financial
asset.
The
Group's
approach
to managing liquidity is to ensure, as far as possible, that it
will have sufficient
liquidity to meet its
liabilities when they are due, under both normal and stressed
conditions, without incurring unacceptable losses
or risking
damage to
the Group's
reputation.
Exposure
to
liquidity
and
cash
flow
risk
The
following
tables
present
the
remaining
contractual
maturities of
financial
liabilities at
the
reporting
date. The
amounts
are
gross
and
undiscounted
and
include
contractual
interest
payments
and exclude
the impact
of
netting agreements.
Company
as
at
31
October
2022
The
interest
payments
on
the
financial
liabilities
represent
the
fixed
interest
rates
as per
the respective
contracts.
The
Group
aims
to
maintain
the
level
of
its
cash
and
cash
equivalents
and
other
highly
marketable
debt
investments at an
amount in
excess of expected
cash outflows on financial liabilities other than trade payables.
The Group
also monitors the level
of expected cash inflows on trade and
other
receivables
together with
expected cash outflows on
trade and
other payables.
Market
risk
Market
risk
is
the
risk
that
changes
in
market
prices
-
such
as
foreign
exchange
rates,
interest
rates
and
equity prices - will
affect the
Group's
income or
the
value
of
its holdings of financial instruments. The objective
of
market
risk
management
is
to
manage and
control market
risk
exposures
within
acceptable
parameters, while optimising
the return.
Foreign
currency
risk
The
Group undertakes certain transactions denominated in foreign
currencies. Hence, exposures
to exchange rate
fluctuations
arise.
The
carrying amounts of the Group's foreign currency denominated
monetary assets and monetary liabilities
at the
reporting
date are
as
follows:
Group
foreign
exchange
risk
|
31
October
2023 31
October
2022
|
|
|
£
(GBP)
|
R
(ZAR)
|
£
(GBP)
|
R
(ZAR)
|
|
Trade
and
other
receivables
|
258,319
|
7,144,365
|
-
|
5,708,637
|
|
Cash
and
cash
equivalents
|
765,814
|
2,090,921
|
922,613
|
67,345
|
|
Unsecured
shareholders'
loans
|
-
|
(98,761,043)
|
-
|
(87,836,461)
|
|
Secured
loans
|
-
|
(8,231,521)
|
-
|
(11,739,909)
|
|
Convertible
loan
notes
|
(491,071)
|
-
|
(710,274)
|
-
|
|
Right
of
use
finance
lease
|
-
|
(3,905,322)
|
-
|
(5,608,577)
|
|
Trade
payables
|
(348,730)
|
(17,535,102)
|
(160,585)
|
(9,758,757)
|
|
Net
statement
of
financial
exposure
|
184,332
|
(119,197,702)
|
51,754
|
(109,167,722)
|
|
Next
6
months
actual
sales
|
-
|
-
|
1,434,073
|
30,816,695
|
|
Next
6
months
actual
forecast
|
-
|
-
|
(1,231,550)
|
(26,464,641)
|
|
Net
statement
of
financial
exposure
|
-
|
-
|
202,523
|
4,352,054
|
|
|
|
|
|
|
|
Net
exposure
|
184,332
|
(119,197,702)
|
254,277
|
(104,815,668)
|
|
Company
foreign
exchange
risk
|
|
|
|
|
|
31
October
2023 31
October
2022
|
|
|
£
(GBP)
|
R
(ZAR)
|
£
(GBP)
|
R
(ZAR)
|
|
Trade
and
other
receivables
|
258,319
|
-
|
-
|
-
|
|
Cash
and
cash
equivalents
|
765,814
|
-
|
922,613
|
-
|
|
Convertible
loan
notes
|
(491,071)
|
-
|
(710,274)
|
-
|
|
Trade
payables
|
(348,730)
|
-
|
(160,585)
|
-
|
|
Net
statement
of
financial
exposure
|
184,332
|
-
|
51,754
|
-
|
|
Next
6
months
sales
forecast
|
-
|
-
|
-
|
-
|
|
Next
6
months
purchases
forecast
|
-
|
-
|
(1,231,550)
|
-
|
|
Net
statement
of
financial
exposure
|
-
|
-
|
(1,231,550)
|
-
|
|
|
|
|
|
|
|
Net
exposure
|
184,332
|
-
|
(1,179,796)
|
-
|
As
previously disclosed Dynamic was sold post year end in January
2024. It is the opinion of the Directors that the only foreign
exchange risk that the Group faced were the outstanding
debtor and
creditor balances at the 31
October 2023
as documented on the statement of
financial position. It is
believed that the
trading
in
November and
December, wouldn't
have created
foreign exchange risk as
cash wouldn't have
been
received nor paid
prior to
the sale
of
the
subsidiary.
The
following
significant
exchange
rates
in
relation
to
the
reporting
currency
are
applicable:
Average
for
the
year Year
end
spot
rate
|
|
2023
|
2022
|
2023
|
2022
|
|
United
States
Dollar
($)
|
1.2477
|
1.2610
|
1.2154
|
1.1469
|
|
South
African
Rand
(ZAR)
|
21.7957
|
20.5000
|
22.6757
|
21.0410
|
The
presentation
currency
of
the
Group
is
British
Pound
Sterling.
The
Group
is
exposed
primarily
to
movements
in
USD
and
ZAR,
the
currency
in
which
the
Group
receives
most of
its
funding,
against
other
currencies
in
which the Group
incurs
liabilities
and
expenditure.
Sensitivity
analysis
Financial
instruments affected by foreign currency risk include
cash
and cash equivalents, trade other
receivables and trade and other payables. The following analysis,
required by IFRS 7 Financial Instruments: Disclosures,
is
intended
to
illustrate
the
sensitivity
of
the
Group's
financial
instruments
(at
year end)
to
changes
in
market
variables,
being
exchange
rates.
The
following
assumptions
were
made
in
calculating
the
sensitivity
analysis:
•
all
income
statement
sensitivities
also
impact
equity;
and
•
translation
of
foreign
subsidiaries
and
operations
into
the
Group's
presentation
currency
have
been
excluded from
this
sensitivity
as they
have no
monetary effect on
the results.
|
Income
statement
/
equity
|
|
|
|
2023
|
2023
|
2022
|
2022
|
|
|
+10%
|
-10%
|
+10%
|
-10%
|
|
United
States
Dollar
($)
|
0.1215
|
(0.1215)
|
0.1147
|
(0.1147)
|
|
South
African
Rand
(ZAR)
|
2.2676
|
(2.2676)
|
2.1041
|
(2.1041)
|
The
above
sensitivities
are
calculated
with
reference
to
a
single
moment
in
time
and
will
change due
to
a
number of
factors including:
•
fluctuating
other
receivable
and
trade
payable
balances;
•
fluctuating
cash
balances;
and
•
changes
in
currency
mix.
Interest
rate
risk
The
Group has entered
into fixed rate agreements
for its
finance leases
and shareholders loans. The
Group does
not
hedge
its
interest
rate
exposure
by
entering
into
variable
interest
rate
swaps.
|
Exposure
to
interest
rate
risk
|
|
|
The
interest
rate
profile
of
the
Group's
interest-bearing
financial
instruments
management of
the Group
is as per the
table
below.
|
as
reported
|
to
the
|
|
Group
|
Company
|
|
|
2023 2022
|
2023
|
2022
|
|
£ £
|
£
|
£
|
|
Financial
assets
|
-
|
-
|
-
|
-
|
|
Financial
liabilities
|
(5,033,428)
|
(5,709,321)
|
(491,071)
|
(710,274)
|
|
|
|
|
|
|
|
Fair
value
sensitivity
analysis
for
fixed-rate
instruments
The
Group
does
not
account
for
any
fixed-rate
financial
assets
of
financial
liabilities
at
FVTPL.
Therefore,
a change
in
interest rates
at
the
reporting
date
would
not
affect
profit
or
loss.
Other
market
price
risk
The
Group
is
exposed
to
equity
price
risk,
which
arises
from
equity
securities
at
FVTOCI
are
held
as
a
long- term
investment.
The
Groups'
investments
in equity
securities
comprise
small shareholdings
in unlisted
companies. The
shares are not
readily tradable and any monetisation of the shares
is dependent on finding a willing
buyer.
Valuation
techniques
and
assumptions
applied
for
the
purpose
of
measuring
fair
value
The
fair
value
of
cash
and receivables and liabilities approximates the
carrying values disclosed in
the financial statements.
Capital
management
The
Group
manages
its
capital
resources
to
ensure
that
entities
in
the
Group
will
be
able
to
continue
as
a
going concern, while maximising
shareholder return.
The
capital
structure of
the Group
consists of equity attributable to shareholders, comprising issued
share capital and reserves. The availability of new capital will
depend on many factors including a positive operating environment,
positive stock market conditions, the Group's track record, and the
experience of management. There are no externally imposed capital
requirements. The Directors are
confident that adequate cash resources exist or will be made
available to finance operations but controls over
expenditure
are
carefully
managed.
30.
Related
party
transactions
Directors'
fees
During
the
year
ended
31
October
2023
£123,260
was
paid to
Directors
of
the
Company
(2022:
£35,923
). At
the
year-
end
a
total
of
£2,810
(2022:
£33,587)
was
outstanding
in
respect
of
Directors'
emoluments.
Other
related
party transactions
Included
in
trade
and
other
payables
are
the
following
related
party
financial
liabilities:
Terms:
Matthew
Bonner
and
Robert
Scott:
The
loan
bears
interest at
the South
African
prime
overdraft rate.
The interest
will
be
calculated
and
paid
when
the
loan
is
repaid.
The loan
is
repayable
as
decided
upon
from
time to
time.
Outstanding
Director's
salaries
and
related
party
transactions
Included
in trade and
other
payables
are
the
following
outstanding Directors'
salaries
and
fees payable
to related parties for other
services:
The
following
information relates to the comparative
period
when Andrew Monk
was
a director
of
both
the Company
and K2.
Arrangements
with
K2
During
the
period
under
review
the
Company
and
K2
entered
into
certain
related
party
arrangements
in
relation
to
DI
as
outlined
below.
K2
is
a
10%
subsidiary
of
VSA
Capital.
At
the
time
the
arrangements
were entered
into
Andrew Monk
was a director
of
the Company,
VSA Capital and K2 and
is deemed
to have
significant influence
over
VSA
Capital and K2.
Disposal
of
4S%
equity
interest
in
DI
to
K2
K2
subscribed
for such
number of
new shares
in the capital of DI resulting in K2 holding 49% of
the
enlarged issued
share
capital
of
DI
for a
consideration
of
ZAR10,982
and
therefore became
a
significant
shareholder in
DI representing the
non-controlling
interest
disclosed
in the group
financial statements.
Put
and
call
option
for
K2
to
acquire
remaining
51%
of
DI
At
the
same
time
a
put
and
call
option
agreement
was
entered
into
with
the
Company
granting
to
K2
the
option to acquire 11,430 shares in DI, which represents the
remaining 51% equity interest currently owned by
the
Company.
This
is
subject
to
the
satisfaction
of
certain
conditions
and
a
time
restrictions
of
31 December
2023
for
a
consideration
of £1.
Disposal
of
group
loans
in
DI
from
the
Company
to
K2
and
entry
into
a
loan
subordination
agreement
Simultaneously
with the above subscription and to allow the equity in DI to be
issued to K2, the Company agreed to assign certain debts owing by
DI, amounting to £4.2 million
which had
been fully
impaired in
prior
years,
to
the
Company
and
certain
other parties
to
K2
in
consideration
for K2
paying
to
the
Company
£100,001
and
agreeing
to
fund
DI
so
as
to
enable
DI
to
carry
on
its
business
in
the
ordinary course
until such time as the Company ceases to hold any further shares in
DI. This assignment agreement resulted in K2 having a
non-controlling interest in DI, full details of K2's
non-controlling interest are
at
note
23.
Additionally,
the assignment of the loans resulted in the Group incurring a
finance charge on consolidation of
£3.1 million.
K2 has
signed a subordination
agreement in
relation to
the loans
due by
DI
to
K2
with
an
expiry
date
of
31
October
2023.
Should
K2
choose
to
request
the
repayment
of
the
loans due
by
DI this will
severely impact the
Company's
ability
to continue as
a
going
concern.
31.
Controlling
Party
Note
There
is
no
single
controlling
party.
Significant
shareholders
are
listed
below.
32.
Subsequent
events
Subsequent
to
year
end
the
following
occurred:
-
The
Company acquired from PI Distribution Investment
Ltd the
entire
issued share
capital of
Precious Link (UK)
Limited ('PL').
PL is
a wine
retailer incorporated
and registered
in England
and Wales
which consists
of
2
retail
liquor
outlets
in
the
Southeast
of
England.
For
the
year
ended
30
September
2022,
PL made
a
loss
before
tax
of
£35,057
on
turnover
of
£692,985.
For
the
same
period
net
liabilities
amounted
to
£533,631.
Under
the
terms
of
the
SPA
the
Company
will
issue
12,500,000
new
ordinary
shares
of
£0.02
each
in the
issued share
capital of
the
Company ('Ordinary Shares')
at
a
value
of
4
pence
per
Ordinary Share,
valuing
the
transaction
at
£500,000.
At
the
date
of
signing
the
accounts
these
shares
had not
yet been
issued.
This
is
due
to
complexities
with
the
vendors
and
the
British
Virgin
Islands
company
that
we purchased PL from. The £200,000 loan between PL and the Company
will remain in force and the director
of
PL
has
assigned
his
loan
of
circa
£0.5m,
due to
him
from
PL, to
the Company,
as a
condition
of
the
SPA.
Following
the
issue
of
the
12,500,000
new
Ordinary
Shares
to
PI
Distribution
Investment
Ltd,
the
total
number
of
Ordinary
Shares
in
issue
with
voting
rights
in
the
Company
will
be
77,388,855
('Total Voting
Rights').
On
10 January 2024 the Company announced that it had acquired PL and
issued 12,500,000 new Ordinary Shares
as
consideration for the
acquisition.
In fact
these
shares
have not
yet
been
issued due
to complexities with the vendors
and the British
Virgin Islands company from which PL was acquired.
The
total
number
of
shares
currently
in
issue
therefore
is
64,888,855
and
this
represents
the
total
number of
voting
rights
in
the
Company.
The Company
will
make
a
further
announcement
updating
the market
as soon
as it
issues
the
new
Ordinary
Shares in
respect of
PL.
-
The Company and K2 exercised the put and call option agreement
('Option Agreement'), that was detailed
in
the
Annual
Financial
Statements
for
the
year
ending
October
2022
and
announced
on
27
July 2023
and
the
option
was
exercised
by K2
on 16
January 2024.
In October
2022,
K2
subscribed
for
such
number
of
new
shares
in
the
capital
of
DI
resulting
in
K2
holding
49%
of
the
enlarged
issued
share
capital
of
DI
for
a
consideration
of
ZAR10,982,
with
the
Company
retaining
the remaining
51%. The
Company also agreed to assign certain debts owing by DI, amounting
to £4.2 million which had been fully impaired
in
prior
years,
to
the
Company
and
certain
other
parties
to
K2
in
consideration for
K2
paying
to
the
Company
£100,001
and
agreeing
to
fund
DI
so
as
to
enable
DI
to
carry
on
its
business
in
the
ordinary
course until such time as the Company ceased to hold any further
shares in DI. This assignment agreement
resulted
in
K2
having
a
non-controlling
interest
in
DI
and
DI
was
consolidated
as
such.
At
the same
time,
the
Company
and
K2
also
entered
into
the
Option
Agreement
which
was
extended
by
mutual agreement
and
exercised
on
16
January
2024.
Under
the
Option
Agreement
the
Company
granted
to
K2
the
option
to
acquire
11,430
shares
in
DI,
being
the
remaining
51%
of
DI
held
by
the
Company,
subject
to the
satisfaction
of
certain
conditions
and
subject
to
certain
time
restrictions,
for
£1.
At
31
October
2023
DI
was
still
controlled
by
Everest
Global
and
is
consolidated
in
the
Group
financial
statements
for
this
year.
General
meeting
The
Company
will
be holding
a general
meeting ('GM')
at the
offices
of
Keystone
Law,
1st Floor,
48 Chancery
Lane, London,
WC2A
1JF
on
28
February
2024
at
11am.
The
notice
convening
the
GM
was
issued
on
12
February
2024.
Annual
general
meeting
The
Company
has
not yet
scheduled
an annual
general meeting
('AGM') at
the
time
of
signing
the accounts.
All details of the future AGM will be provided to shareholders and
notice convening the meeting
will be released on the London
Stock Exchange as
well as on the Company's
website.
Auditor
The
Board
recommend
that
RPG
Chapman
Crouch
LLP be
reappointed as
auditor, a
resolution will
be tabled
at the
GM
on
28
February
2024
for
their
re-appointment
following
the
31
October
2022
audit
being
signed
off.
Directors'
and
officers'
insurance
The
Group maintains insurance
cover for all Directors
and
officers
of
Group
companies against
liabilities
which may
be
incurred
by
them
while
acting
as
Directors
and
officers.