TIDMLSAI
RNS Number : 0801N
Location Sciences Group PLC
27 September 2021
27 September 2021
This announcement contains inside information for the purposes
of Regulation 11 of the Market Abuse (Amendment) (EU Exit)
Regulations 2019/310. With the publication of this announcement via
a Regulatory Information Service, this inside information is now
considered to be in the public domain.
Location Sciences Group PLC
("Location Sciences" or the "Company" or the "Group")
Interim Results for the six months ended 30 June 2021
Location Sciences (AIM: LSAI), the leading location data insight
and verification company, announces its interim results for the six
months ended 30 June 2021.
CHAIRMAN'S REPORT FOR THE PERIODED 30 JUNE 2021
Introduction
On 11 February 2021, the Company announced that, in part as a
consequence of COVID-19, the Company and in particular Verify,
would continue to face a number of trading challenges. This was
despite the relative strength of the Company's working capital
position. Included within that announcement, the Board advised
Shareholders that it was exploring a number of options for the
Company and its businesses and that further announcements would be
made as and when appropriate.
Since the announcement on 11 February 2021, and following
numerous discussions, both internally and with third parties,
surrounding the business review, the Board concluded that given the
market outlook for each of the Company's business units, it was
essential that Location Sciences secured additional financial
resources.
In May 2021 the Company successfully secured approximately GBP4
million in new investment and support, from investors including
Mahmud Kamani, Founder & Group Executive Chairman at Boohoo
Group plc and Richard Hughes, founder at Zeus Capital, In addition,
the Board was strengthened through the appointments of Simon
Wilkinson as Non-Executive Chairman and Dr Nigel Burton as
Non-Executive Director.
The addition of these new supportive shareholders and the
experience and relationships of the new directors, together with
the additional resources from the Placing and Subscription, has
considerably enhanced the opportunities available to the
Company.
Trading performance
Unaudited underlying revenues for the six months ended 30 June
2021 were GBP277,954, a reduction of 57% compared to H1 2020
revenues of GBP650,385. We would note, that in H1 2020 Insight
revenues were increased by GBP195,513 due to the X-Mode contract
securitisation.
Verify and Insight revenues were GBP50,968 and GBP226,986
respectively for H1 2021 compared with GBP157,526 and GBP492,859 in
H1 2020.
The cost cutting measures implemented in 2020 reduced
administration expenses by 21% from GBP785,066 in H1 2020 to
GBP622,684 in H1 2021.
EBITDA loss for the six months to 30 June 2021 was GBP486,500,
representing an increase of 45% on the EBITDA loss in the six
months to 30 June 2020 of GBP334,630.
Loss before tax for the six months to 30 June 2021 was
GBP690,850, representing an increase of 8% on the loss before tax
in the six months to 30 June 2020 of GBP639,152.
Cash resources
In May 2021, the Company raised approximately GBP3.6 million
(net of expenses) through an equity placing, subscription and
broker option which comprised the issue and allotment of
2,017,750,000 ordinary shares in the Company.
As a consequence, the Company's cash resources as of 30 June
2021 were significantly enhanced at GBP4,333,115 compared to
GBP1,652,969 as at 30 June 2020.
The Company had no debt at 30 June 2021 (GBPnil 30 June
2020).
Outlook
As noted on 21 June 2021, following the successful fundraising
and Board changes, the new Board continues to review how best to
maximise the value of the Company's two core business units, namely
location verification and data and insights. Whilst discussions
continue, both internally and externally, the Board has taken steps
to reduce operating costs further. These reductions will begin to
be realised in the second half of 2021 and together with our cash
resources provide a solid platform from which to leverage the
opportunities available to us.
I look forward to updating shareholders in due course.
Simon Wilkinson
Chairman
LOCATION SCIENCES GROUP PLC
CONSOLIDATED PROFIT AND LOSS ACCOUNT FOR THE PERIODED 30 JUNE
2021
Six months Six months
ended ended Year ended
30 June 30 June 31 December
2021 2020 2020
Unaudited Unaudited Audited
Note GBP GBP GBP
Revenue 4 277,954 650,385 1,080,742
Cost of sales (141,770) (219,287) (358,196)
---------- ---------- -------------
Gross profit 136,184 431,098 722,546
Grant income - 10,000 -
Other income - 9,338 30,119
Administrative expenses (622,684) (785,066) (1,535,906)
Amortisation and depreciation (204,351) (301,807) (616,778)
---------- ---------- -------------
Operating loss 4 (690,851) (636,437) (1,400,019)
Finance income 1 95 98
Finance expense - (2,810) (5,619)
---------- ---------- -------------
Loss before tax (690,850) (639,152) (1,405,540)
Taxation 71,514 60,000 166,272
---------- ---------- -------------
Loss for the financial year
attributable to owners of
the company (619,336) (579,152) (1,239,268)
========== ========== =============
Earnings per share
Loss per share - basic and diluted (0.06p) (0.12p) (0.24p)
The above results were derived from continuing operations.
LOCATION SCIENCES GROUP PLC
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE PERIODED
30 JUNE 2021
Six months Six months
ended ended Year ended
30 June 30 June 31 December
2021 2020 2020
Unaudited Unaudited Audited
GBP GBP GBP
Loss for the year (619,336) (579,152) (1,239,268)
Foreign currency translation
losses (4,719) (7,006) (10,475)
---------- ---------- ------------
Total comprehensive income for
the year attributable to owners
of the company (624,055) (586,158) (1,249,743)
========== ========== ============
LOCATION SCIENCES GROUP PLC
CONSOLIDATED BALANCE SHEET AS AT 30 JUNE 2021
30 June 30 June 31 December
2021 2020 2020
Unaudited Unaudited Audited
Note GBP GBP GBP
Non-current assets
Intangible assets 1,153,954 1,156,227 1,141,792
Property, plant and equipment 3,198 56,668 5,828
------------ ------------ ------------
1,157,152 1,212,895 1,147,620
------------ ------------ ------------
Current assets
Trade and other receivables 505,232 556,769 415,104
Current tax asset 71,514 60,000 166,272
Cash and cash equivalents 4,333,115 1,652,969 1,128,118
------------ ------------ ------------
4,909,861 2,269,738 1,709,494
------------ ------------ ------------
Current liabilities
Trade and other payables (148,577) (234,388) (211,607)
Current portion of borrowings - (24,118) -
------------ ------------ ------------
(148,577) (258,506) (211,607)
------------ ------------ ------------
Net current assets 4,761,284 2,011,232 1,497,887
------------ ------------ ------------
Net assets 5,918,436 3,224,127 2,645,507
============ ============ ============
Capital and reserves
Called up share capital 5 16,298,007 14,263,288 14,280,258
Share premium reserve 21,170,312 19,250,749 19,315,231
Merger relief reserve 11,605,556 11,605,556 11,605,556
Capital reserve 209,791 209,791 209,791
Other reserves (9,225,108) (9,204,463) (9,225,108)
Retained earnings (34,140,122) (32,900,794) (33,540,223)
------------ ------------ ------------
Total equity 5,918,436 3,224,127 2,645,507
============ ============ ============
LOCATION SCIENCES GROUP PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE PERIODED 30
JUNE 2021
EQUITY ATTRIBUTABLE TO THE PARENT COMPANY
Merger relief Capital Retained
Share capital Share premium reserve reserve Other reserves earnings Total
GBP GBP GBP GBP GBP GBP GBP
At 1 January
2020 14,008,033 18,508,593 11,605,556 209,791 (9,225,108) (32,338,792) 2,768,073
Loss for the
period - - - - - (579,152) (579,152)
Other
comprehensive
income - - - - - (7,006) (7,006)
Issue of
shares 255,255 742,156 - - - - 997,411
Share based
payments - - - - - 24,156 24,156
Shares to be
issued - - - - 20,645 - 20,645
------------- ------------- ------------- -------------- -------------- -------------- ---------
At 30 June
2020 14,263,288 19,250,749 11,605,556 209,791 (9,204,463) (32,900,794) 3,224,127
============= ============= ============= ============== ============== ============== =========
At 1 January 2020 14,008,033 18,508,593 11,605,556 209,791 (9,225,108) (32,338,792) 2,768,073
Loss in year - - - - - (1,239,268) (1,239,268)
Other Comprehensive Income - - - - - (10,475) (10,475)
Issues of shares 272,225 806,638 - - - - 1,078,863
Share based payments - - - - - 48,312 48,312
---------- ---------- ---------- ------- ----------- ------------ -----------
At 31 December 2020 14,280,258 19,315,231 11,605,556 209,791 (9,225,108) (33,540,223) 2,645,505
========== ========== ========== ======= =========== ============ ===========
At 1 January 2021 14,280,258 19,315,231 11,605,556 209,791 (9,225,108) (33,540,223) 2,645,505
Loss for the period - - - - - (619,336) (619,336)
Other comprehensive income - - - - - (4,719) (4,719)
Issue of shares 2,017,749 1,855,081 - - - - 3,872,830
Share based payments - - - - - 24,156 24,156
---------- ---------- ---------- ------- ----------- ------------ ---------
At 30 June 2021 16,298,007 21,170,312 11,605,556 209,791 (9,225,108) (34,140,122) 5,918,436
========== ========== ========== ======= =========== ============ =========
LOCATION SCIENCES GROUP PLC
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE PERIODED 30 JUNE
2021
Six months Six months
ended ended Year ended
30 June 30 June 31 December
2021 2020 2020
Unaudited Unaudited Audited
Note GBP GBP GBP
Cash flows from operating activities
Loss for the year (619,336) (579,152) (1,239,268)
Adjustments to cash flows
from non-cash items
Depreciation and amortisation 204,351 301,807 616,778
Foreign exchange (gains)
/ losses (4,719) (7,006) (10,475)
Finance income (1) (95) (98)
Finance costs - 2,810 5,619
Share based payment transactions 24,156 24,156 48,312
Income tax expense (71,514) (60,000) (166,272)
Up lift in fair value of
directors' fees 195,500 - -
Shares issued other than
for cash 120,000 97,568 158,362
---------- ---------- ------------
(151,563) (219,912) (587,042)
Working capital adjustments
Decrease in trade debtors (90,128) (149,448) (7,783)
Decrease in trade creditors (62,480) (114,691) (137,472)
---------- ---------- ------------
Cash used in operations (304,171) (484,051) (732,297)
Income taxes received 166,272 166,909 166,909
---------- ---------- ------------
Net cash used in operating
activities (137,889) (317,142) (565,391)
---------- ---------- ------------
Cash flows from investing
activities
Interest received 1 95 98
Acquisitions of tangible
assets - (1,277) (1,278)
Acquisition of intangible
assets (214,435) (221,324) (471,019)
---------- ---------- ------------
Net cash used in investing
activities (214,434) (222,506) (472,199)
---------- ---------- ------------
Cash flows from financing
activities
Proceeds from issue of ordinary
shares, net of issue costs 3,557,330 920,488 920,504
Payments to finance lease
creditors - - -
IFRS 16 liability repayment - (53,610) (80,537)
---------- ---------- ------------
Net cash generated from
financing activities 3,557,330 866,878 839,967
---------- ---------- ------------
Net increase/(decrease)
in cash and cash equivalents 3,204,997 327,230 (197,621)
Cash and cash equivalents
at beginning of period 1,128,118 1,325,739 1,325,739
---------- ---------- ------------
Cash and cash equivalents
at end of period 4.333.115 1,652,969 1,128,118
========== ========== ============
Non-cash financing activities
Fees settled by share issues 265,500 76,923 76,923
Directors fees settled by
share issues 285,500 20,645 81,452
LOCATION SCIENCES GROUP PLC
NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIODED 30 JUNE
2021
1 General information
Location Sciences Group PLC and its subsidiary Location Sciences
AI Limited (together the "Group") specialise in providing two core
solutions to its customers, namely: 1) Location data and insights -
this is a SaaS solution where customers query Location Sciences' UK
data lake for, inter alia, advertising, location planning,
attribution, competitor analysis and forward looking financial
metrics; and 2) Location verification - utilising sophisticated
machine learning and pattern recognition technologies Verify
detects location ad-fraud and checks the accuracy and quality of
location signals used to improve the performance of digital
advertising.
The Company is a public limited company which is quoted on the
AIM market of the London Stock Exchange and is incorporated and
domiciled in the United Kingdom.
2 Basis of preparation
The financial information has been prepared in accordance with
International Financial Reporting Standards ("IFRS") as adopted by
the European Union, IFRIC interpretations and with those parts of
the Companies Act 2006 applicable to companies reporting under
IFRS. The accounting policies adopted are consistent with those of
the financial statements for the year ended 31 December 2020, as
described in those financial statements.
The figures for the six-month periods ended 30 June 2021 and 30
June 2020 have not been audited. The figures for the year ended 31
December 2020 have been extracted from, but do not constitute, the
consolidated financial statements of Location Sciences Group PLC
for that year. Those financial statements have been delivered to
the Registrar of Companies and included an unqualified auditors'
report, with an emphasis of matter paragraph in relation to going
concern and did not contain a statement under Section 498(2) or
Section 498(3) Companies Act 2006.
3 Loss per share
Six months Six months
ended ended Year ended
30 June 30 June 31 December
2021 2020 2020
Unaudited Unaudited Audited
GBP GBP GBP
Loss attributable to shareholders (619,336) (579,152) (1,239,268)
========== ========== ============
No. No. No.
Weighted average number of shares
(basic) 990,887,398 465,892,712 513,986,630
=========== =========== ===========
The calculation of basic loss per share of 0.06p (June 2020:
0.12p; December 2020: 0.24p) is based on loss after taxation and
the weighted average number of ordinary shares in issue during the
period.
LOCATION SCIENCES GROUP PLC
NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIODED 30 JUNE
2021
4 Segmental analysis
Operating segments are based on internal reports about
components of the Company, which are regularly reviewed and used by
the Board of Directors being the Chief Operating Decision Maker
("CODM") for strategic decision making and resource allocation, in
order to allocate resources to the segment and to assess its
performance.
During the first half of 2021 the Group has operated through its
trading company Location Sciences AI Limited. The business has two
core solutions to its customers, namely: 1) Location data and
insights - this is a SaaS solution where customers query Location
Sciences' UK data lake for, inter alia, advertising, location
planning, attribution, competitor analysis and forward looking
financial metrics; and 2) Location verification - utilising
sophisticated machine learning and pattern recognition technologies
Verify detects location ad-fraud and checks the accuracy and
quality of location signals used to improve the performance of
digital advertising.
It should be noted that a segmental analysis of the Consolidated
Statement of Financial Position is not part of routine management
reporting and, consequently, no segmental analysis of assets is
shown here. The US subsidiary is not yet trading at a materially
significant level and thus geographical reporting is not
reported.
An analysis of operating revenue is as follows:
Six months Six months
ended ended Year ended
30 June 30 June 31 December
2021 2020 2020
Unaudited Unaudited Audited
GBP GBP GBP
Location data and insights 226,986 492,859 762,170
Verify 50,968 157,526 318,572
---------- ---------- ------------
277,954 650,385 1,080,742
========== ========== ============
An analysis of EBITDA is as follows:
Six months Six months
ended ended Year ended
30 June 30 June 31 December
2021 2020 2020
Unaudited Unaudited Audited
GBP GBP GBP
Location data and insights (397,291) (253,581) (552,365)
Verify (89,209) (81,049) (230,877)
---------- ---------- ------------
(486,500) (334,630) (783,242)
========== ========== ============
LOCATION SCIENCES GROUP PLC
NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIODED 30 JUNE
2021
4 Segmental analysis (continued)
An analysis of loss before tax is as follows:
Six months Six months
ended ended Year ended
30 June 30 June 31 December
2021 2020 2020
Unaudited Unaudited Audited
GBP GBP GBP
Location data and insights (564,170) (430,741) (970,849)
Verify (126,680) (208,411) (405,796)
---------- ---------- ------------
(690,850) (639,152) (1,405,540)
========== ========== ============
5 Share capital
30 June 30 June 31 December
2021 2020 2020
Unaudited Unaudited Audited
GBP GBP GBP
2,605,087,398 ordinary shares
of 0.1p (June 2020 - 570,368,300
of 0.1p, December 2020 - 587,337,398
of 0.1p) each 2,605,087 570,369 587,337
1,040,712,398 deferred shares
of 0.99p each (June 2020: 0.99p,
December 2020: 0.99p 10,303,053 10,303,053 10,303,054
376,651,734 New Deferred shares
of 0.9p (June 2020: 0.9p, December
2020: 0.9p) 3,389,866 3,389,866 3,389,866
---------- ---------- -----------
16,298,007 14,263,288 14,280,258
========== ========== ===========
LOCATION SCIENCES GROUP PLC
NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIODED 30 JUNE
2021
5 Share capital (continued)
Share issue
On 25 May 2021 1,842,500,000 ordinary shares of 0.1p were issued
at 0.2p pursuant to a placing, subscription and broker option with
a nominal value of GBP1,842,500 for aggregate consideration of
GBP3,685,000 before costs of the placing, subscription and broker
option, with an additional 132,750,000 ordinary shares issued at
0.2p to settle professional fees in relation to the placing,
subscription and broker option. At the same time 42,500,000
ordinary shares were issued at the market value on day of admission
of the shares at 0.66p to the non-executive directors in lieu of
their first-year fees.
At the same time various warrants were issued to certain parties
as detailed in the section below.
Share rights
Ordinary shares have attached to them full voting, dividend and
capital distribution (including on winding up) rights; they do not
confer any rights of redemption.
Deferred shares have attached to them no voting, dividend or
capital distribution (including on winding up) rights; they do not
confer any rights of redemption.
Warrants in Issue
1) Promoter Warrants - non-transferable warrants to subscribe
for up to 1,500,000,000 Ordinary Shares, exercisable at the 0.20p
for five years from 25 May 2021, were issued to certain members of
the Concert Party in consideration of those persons assembling and
co-ordinating the Concert Party's investment in the Company in May
2021 and facilitating the appointment of Simon Wilkinson as
Non-Executive Chairman.
Name Number of Ordinary Shares subject to Promoter Warrants
Richard Hughes 500,000,000
Mahmud Kamani 500,000,000
Simon Wilkinson 500,000,000
2) Cornerstone Investor Warrants - non-transferable warrants to
subscribe for up to 250,000,000 Ordinary Shares, exercisable at
0.20p for five years from 25 May 2021, were issued to the
Cornerstone Investors of the May 2021 placing.
Name Number of Ordinary Shares subject to Cornerstone Investor
Warrants
Ben Turner 50,000,000
Donna Turner 75,000,000
James Pope 50,000,000
Maxine Pope 75,000,000
LOCATION SCIENCES GROUP PLC
NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIODED 30 JUNE
2021
3) Broker Warrants - transferable warrants to subscribe for up
to 100,000,000 Ordinary Shares, exercisable at the 0.20p for five
years from 25 May 2021 were issued as shown below.
Name Number of Ordinary Shares subject to Broker Warrants
Turner Pope 58,750,000
Dr Nigel Burton 25,000,000
Mark Slade 10,000,000
David Rae 6,250,000
4) Director Warrants - non-transferable warrants to subscribe
for, in aggregate, 120,000,000 Ordinary Shares were issued to the
Executive Directors and the Non-Executive Directors, exercisable at
0.20p for five years from 25 May 2021, provided that the Ordinary
Shares have traded at a Volume Weighted Average Price (VWAP) at or
above 0.30p for 20 consecutive Business Days, or on a change of
control of the Company.
Name Number of Ordinary Shares subject to Broker Warrants
Mark Slade 30,000,000
David Rae 30,000,000
Simon Wilkinson 30,000,000
Dr Nigel Burton 30,000,000
The pre-existing share warrants held by Mike Staten were
surrendered on 25 May 2021 in consideration for the issue of 5
million Ordinary Shares at 0.20p
6 Availability of half-year report
Copies of the half-year report are available on request from the
Company's registered office at First Floor, St James House, St
James Square, Cheltenham, Gloucestershire GL50 3PRand can also be
viewed at:
https://www.locationsciencesgroup.ai/investor-relations/reports-presentations/
For further information please contact:
Location Sciences Group PLC via Milk & Honey PR
Mark Slade, Chief Executive Officer
David Rae, CFO and Commercial Director
Allenby Capital Limited (Nominated Adviser) Tel: +44 (0)20 3328 5656
David Hart
Vivek Bhardwaj
Turner Pope Investments (TPI) Ltd (Joint Broker) Tel: +44 (0)20 3657 0050
James Pope
Andy Thacker
Peterhouse Capital (Broker) Tel: +44 (0) 20 7220 9791
Charles Goodfellow
Eran Zucker
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IR SEMFFWEFSESU
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