Reasons to be optimistic, but 1 big concern!21 Nov 2022 09:30
Hi Folks,
3m in the bank and another 1m in TAX credits to come. Not the worst cash position in the world and plenty of reasons to be optimistic for the future (AHIL, Stroke Product, NICE, and FDA etc).
In context, i have a large holding (money i don't want to loss). I raise this point out of genuine concern and ask with sincerity. Is the terminology the BOD uses around funding normal for an AIM listed company or is it just compliance related. i.e., in the reporting rules of AIM? The sentence below worries me the most:
"While the Board has a successful track record in raising funds, there remains uncertainty as to the amount of funding that could be raised from shareholders or debt providers. This condition represents a material uncertainty that may cast significant doubt on the Group and Company's ability to continue as a going concern."
Full context below:
Going concern
The Group's business activities, market conditions, principal risks and uncertainties along with the Group's financial position are described in the full annual accounts. The Group funds its day-to-day cash requirements from existing cash reserves. These matters have been considered by the Directors in forming their assessment of going concern.
The Directors have concluded that it is necessary to draw attention to the revenue and cost forecasts in the business plans during the period to June 2024. The Group and Company does not currently have sufficient cash resources to continue as a going concern during the forecast period due to the time expected to be needed to gain commercial traction in its revenues. The forecasts prepared by the Directors include a plan to raise additional funds from shareholders or debt providers in the financial year to June 2023.
While the Board has a successful track record in raising funds, there remains uncertainty as to the amount of funding that could be raised from shareholders or debt providers. This condition represents a material uncertainty that may cast significant doubt on the Group and Company's ability to continue as a going concern.
However, based on the progress being made towards bringing the AIHL product to market and having made enquiries, the Directors have reasonable confidence in their ability to raise additional funds and therefore have a reasonable expectation that the Group has access to adequate resources to continue in operational existence for the foreseeable future.
Accordingly, the Directors have concluded that it is appropriate to continue to adopt the going concern basis of accounting in preparing these financial statements. These financial statements do not include the adjustments that would result if the Group and Company were unable to continue as a going concern.
I look forward to the presentation.
GLA.
Stephen11.
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