8PG.L Regulatory News (8PG)

28 July 2014

Legendary Investments Plc

("Legendary" or the "Company")

RESULTS FOR THE YEAR ENDED 31 MARCH 2014

HIGHLIGHTS

· Total net gain on investments at £1,119,000 (2013: £38,000), an increase of 2,845%

· Profit of £901,000, compared with a 2013 loss of £158,000

· Value of investments up at £1,628,000 (2013: £509,000), an increase of 220%

· Net assets up at £1,503,000 (2013:£554,000), an increase of 171%

· Total assets up at £1,732,000 (2013:£649,000), an increase of 167%

Zafar Karim, Executive Chairman said:

"We are pleased at these results, which clearly demonstrate Legendary's ability to source, invest in and proactively add value to investments with potential for massive capital appreciation. The majority of the £901,000 profit was due to the uplift in the value of Virtualstock as crystallised by its April fund raise at a post money valuation of £25.4 million or over 12x the valuation of £2.1 million at which Legendary originally invested. Moreover, we believe that this just the beginning of the journey for Virtualstock. In addition, our other principal investments continue to progress."

EXECUTIVE CHAIRMAN'S STATEMENT

The year under review has been one of landmark progress for Legendary. Substantial progress was made by a number of investee companies, including Virtualstock, Bosques and Amedeo. In particular, a fund raise for Virtualstock placed a post money valuation on its equity of £25.4 million, in turn valuing Legendary's equity and derivative stake at £1,098,000, as at the balance sheet date, generating a landmark (unrealised) profit of £1,045,000. Total net gain on investments was £1,119,000 compared to £38,000 last year. Underperforming investments were divested. Our investment in Regency Mines was disposed of and the proceeds were invested in Oracle Coalfields. Review of potential investments continued throughout the year, although no other suitable investments were identified. Overall, net and total assets as at the year end were £1,503,000 (2013:£554,000), an increase of 171%, and £1,732,000 (2013:£649,000), an increase of 167%, respectively. These results demonstrate the returns that can be generated by Legendary's proactive investment style and, indeed, vindicate its investment strategy.

VIRTUALSTOCK HOLDINGS LIMITED

Virtualstock provides software-as-a-service ("SaaS") supply-chain and data management solutions that seamlessly interface with the vast majority of components in inventory, supply and logistics value chain and data management systems and platforms, giving organisations superior control of data, without interfering with existing systems. Virtualstock SaaS solutions provided increased visibility of how organisations are performing through data intelligence and enable more efficient, leaner and cost effective operations. Implementation of Virtualstock's SaaS solutions is rapid, flexible and scalable.

Shortly after the investment, in November 2012, Virtualstock implemented an "end-to-end turn-key solution" for the online branded product range of Bear Grylls Ventures LLP through its website, www.beargryllsstore.com.

Following this, in the year under review, in June 2013, Virtualstock signed a landmark three-year renewable contract with Tesco Plc, the UK's largest retailer. Virtualstock's SaaS solution was fully integrated and active at Tesco by late November 2013. It connects with Tesco's set of systems and suppliers, delivering a far greater range of products to be offered online. The solution enables Tesco to add rapidly third party suppliers and their associated product ranges onto the Tesco Direct platform with ease. Using the solution, all orders from Tesco's range of suppliers can be viewed and managed centrally, on the same intuitive web based interface. Virtualstock's solution has allowed Tesco to increase significantly its online presence by expanding its non-stocked product range supplied by hundreds of its drop-ship suppliers without having to take on inventory. It forms a key component of Tesco's online technology strategy and infrastructure, providing the suppliers with a tool which enables them to manage fully the selling of their products through Tesco's corporate website.

Winning Tesco as a client and becoming a key part of their online technology infrastructure is an outstanding reference point for Virtualstock. The win demonstrates that the UK's and, indeed, one of the world's largest retailers sees the benefit of Virtualstock's solution. Critically, they trust the solution to form an essential part of their online infrastructure. The win also underlines the robustness and scalability of Virtualstock's solution.

Also in November 2013, Virtualstock signed a significant contract extension with Office Depot International to support its expansion into Germany, Austria, Switzerland and Benelux, with the collaboration spanning eight European territories.

Following on from this, in December 2013, Virtualstock contracted with Kiddicare.com Limited, then part of WM Morrison Supermarkets PLC and now owned by Endless private equity, to supply Kiddicare with Virtualstock's SaaS solution. This contract win is another outstanding reference point for Virtualstock. The service went "live" with Kiddicare in late December 2013.

With landmark contract wins and increasing momentum, growth funding was raised for Virtualstock in early 2014. £525,000 was raised through an oversubscribed issuance of Virtualstock equity to accelerate Virtualstock's growth. The fundraising placed a post money value on Virtualstock of £25.4 million, which compares very favourably to the valuation of £2.1 million at which Legendary which invested in Virtualstock in October 2012. As part of the fundraise, which is seen by Virtualstock as the first in a series of potential strategic transactions, its holding structure was simplified and new articles were put in place. This fund raising closed in early April 2014, a few days after Legendary's year end. In line with FRS 26 and the IPEVG, the value of £25.4 million for Virtualstock was used as a reference for the valuation of the Legendary equity and derivative stake held at the balance sheet date, giving the equity and derivative stake a valuation of £1,098,000 and generating for Legendary a substantial (unrealised) profit of £1,045,000.

As part of the fundraise, Legendary negotiated further warrants and options over shares of Virtualstock representing 1.2% of the fully diluted equity. Consequently, in aggregate, following the fundraise, Legendary's equity and derivative stake in Virtualstock, rather than being diluted from 5.0% to 4.4%, rose to 5.6% of its fully diluted equity.

The fundraise, at a valuation of 12.1x the valuation at which Legendary initially invested, along with the landmark contracts that Virtualstock now has underline the potential of Legendary's proactive investment strategy and the confidence shown by third party investors and world class customers in Virtualstock.

Following on from the fundraise, in May 2014, also post balance sheet, Virtualstock was accepted on the UK Government's G-Cloud 5 Framework programme. G-Cloud 5 provides central government departments, executive agencies and non-departmental public bodies with an innovative, cheaper and faster way to access and purchase government-approved IT products and services through a service catalogue portal. By being accepted on G Cloud 5, Virtualstock is now able to provide its services to public sector organisations. Discussions with respect to large contracts with certain public sector organisations are underway.

In June 2014, post balance sheet, Legendary exercised all of its derivative instruments in Virtualstock taking its equity holding in Virtualstock from 2.2% to 5.6%. As at the balance sheet date, Legendary's equity stake and derivatives in Virtualstock were held on its balance sheet at £1,098,000. Post the exercise and at the growth fund raise valuation, Legendary's stake in Virtualstock is valued at £1,489,000.

Virtualstock's clients include Tesco, Kiddicare, Viking (stationery), Office Depot, Playtex, Wonderbra, Craghoppers and Bear Grylls amongst many others. It has a growing pipeline and is in discussions with several other organisations in both the private and public sectors. Its revenues are growing rapidly and it has extremely high gross margins, typical of companies in the SaaS space.

Virtualstock is in the critical space of aggregating and processing data from a variety of sources. Its SaaS solutions are applicable to a wide range of sectors of which retail is only one. Critically, its solutions have the ability to connect with otherwise fragmented legacy systems without heavy integrations. Virtualstock is well on its way to becoming an industry standard inventory, supply and logistics value chain and data management utility.

Legendary has proactively supported and assisted Virtualstock to reach this stage during which substantial milestones have been achieved by and substantial value has been added to Virtualstock. Legendary looks forward to continuing to assist Virtualstock in achieving further significant milestones and continuing to grow significantly its value. Legendary expects further strategic transactions in the near to medium term with an attendant crystallisation of value.

BOSQUES ENERGETICOS EBE S.A. DE CV

Bosques continues to make steady progress, having advanced its research, development and innovation program each year. Since its establishment in late 2009 and the investment by Legendary in late 2010, its innovation based modus operandi has scored many "firsts" in Mexico and the region. It was the first company to germinate pongamia seeds in Mexico; it was the first to root successfully pongamia scions in Mexico; and it was the first to have pongamia flowers (within two and a half years of planting compared with the normal time of five to six years). It was ahead of others in developing its inter and mixed multi-crop strategy.

In the year under review, Bosques has continued to develop and innovate. Importantly, its progress has been externally recognised.

Prior to November, 2013, Bosques's best pongamia strain was flowering in less than two and a half years compared to five or more years for normal pongamia. In November 2013, Legendary announced that Bosques had further improved its G2P pongamia, which was by then flowering in 23 months, less than two years, and exhibiting seed pods (which at maturity contain seed). This is believed to be another first for Bosques.

Since then, G2P pongamia have continued to flourish. Bosques currently has 300 G2P pongamia of which some 30% have already flowered and are already exhibiting seed pods.

Also in November 2013, Bosques announced that it had developed early and high yielding G4J jatropha. The G4J jatropha commences yielding seeds in as early as six months compared to up to two years for normal jatropha. In addition, the G4J jatropha exhibits multiple branching leading to high yields. Bosques expects that under optimal conditions, G4J jatropha could yield as much as 6,000 plus kg of seeds per hectare in year five. Moreover, G4J jatropha, unlike many jatropha variants, is non-toxic. Bosques currently has 28,000 G4J jatropha of which 14,000 are producing seeds.

Bosques has managed to reduce the time to seed for both its pongamia and jatropha plants, bringing forward cash flows and thereby increasing returns. Increasing yield also increases returns. In addition, its G4J jatropha is non-toxic. The cake remaining after pressing can be used as animal feed which commands a higher price than cake which can be used only as organic fertiliser.

In March 2014, Bosques reported that it had been invited to and had joined the Steering Committee of Project Jetropha on the basis of the strength of the Bosques' cutting edge development work and its strains of bio-diesel crops. Project Jetropha, established by Alternative Fuels America, Inc., is an industry organisation devoted to advocacy, support and collaboration by and for small and mid-sized jatropha producers and jatropha based biodiesel producers seeking to contribute to the growing movement to blend traditional aircraft petroleum with jatropha biodiesel for cleaner aviation fuel. Craig Frank, Chief Executive Officer of Alternative Fuels America, commented at the time "We are delighted that Bosques has joined Project Jetropha as a steering committee member. Its field research based approach is second to none and is producing advanced jatropha varieties with low time to yield and high yield characteristics. The varieties are also edible, further enhancing their economics. We look forward to working with Bosques on Project Jetropha".

The invitation to join the Steering Committee of Project Jetropha is an endorsement of the development and innovations that Bosques has brought about.

Post the year end in July 2014, Bosques announced that it has 18 ha under cultivation, 11 ha in Puebla and another 7 ha in Morelos, with 16,000 pongamia trees of which 300 are G2P, 28,000 jatropha plants of which 14,000 are G4J, and 3,000 castor plants. Having proven its techniques on the its initial 11 ha test plantation and now successful growing G4J jatropha on an additional 7 ha in Morelos, Bosques is in early stage discussions on several fronts, including obtaining larger tracks of land on which to plant its cutting edge pongamia and jatropha.

Legendary has been assisting Bosques in all aspects of its development for the last few years and looks forward to continuing to do so.

Legendary has a substantial minority stake of 40% in Bosques. Companies similar to Bosques in size of test plantation and number of plants are valued at several million pounds. Value crystallisation might be expected in the medium term.

AMEDEO RESOURCES PLC (FORMERLY CREON RESOURCES PLC)

Creon Resources plc was recapitalised in June 2012 and its strategy was reset to focus on resource and resource infrastructure and asset investments. Legendary noted at that time that Creon's new shareholders and management were financially strong, well-connected and experienced. Shortly after the recapitalisation, in July 2012, Creon invested in a new offshore vessel construction joint venture with a multi-billion dollar Singaporean listed shipbuilder, Yangzijiang Shipbuilding (Holdings) Ltd. The joint venture immediately began to build its new offshore vessel yard in Taicang, 50 miles north of Shanghai. In December, 2012, the new joint venture secured its first rig order worth US$170 million for a Le Tourneau Super 116E Class design self-elevating mobile offshore jack up drilling rig named Explorer 1.

In January 2013, Legendary purchased 19 million shares in Creon in exchange for £125,000 of cash and shares in an off-market transaction. As of at the balance sheet date, the market value of the shares was £183,000

In April 2013, in the year under review, and following Legendary's investment, Creon acquired a 49% stake in a ferrous metal and ferrous ore trader, MGR Resources Pte Ltd ("MGR Resources"). This investment was made as there was a natural vertical synergy with the offshore vessel construction joint venture and to provide Creon with near term recurring income (offshore vessel building has long lead times).

Since then, Creon has continued to make significant progress.

Creon's Board was strengthened in September 2013. Zafar Karim was appointed as an Executive Director and Philippe Petitpierre was appointed as a Non-Executive Director. In October 2014, Creon's name was changed to Amedeo Resources plc.

The build of the offshore vessel yard continued apace: Wharf building commenced in October 2013; and wharf and finger piers were nearing completion, with work on the skidway and 900 tonne gantry crane advanced and civil works and workshops 50% completed by January 2014. The yard became operational, post balance sheet, in April 2014.

Progress on the build of Explorer 1 continued to quality and on schedule: Steel was struck in August 2013 and the customer agreed an increased specification for the rig at an increased price of US$175 million in October 2013. The keel was laid, at the by then operational new offshore vessel yard, post balance sheet, in April 2014.

MGR Resources, with the help from Amedeo's investment and Amedeo's contacts, increased the volume of ferrous metals broking it conducted. As a result of this increased activity, it was able to pay Amedeo fee income, interest income and dividend income totalling £311,000 (US$488,000) from April 2013 to January 2014. This was on the back of an equity investment of US$49,900 and the advancement of a US$1.95 million convertible loan by Amedeo to MGR Resources.

Amedeo, with its new shareholders, management and strategy is on what we believe will be an exciting journey. The sectors that it has targeted are buoyant and are expected to remain so. The ticket size in the sectors, at around the US$200 million mark for rigs, is an order of magnitude larger than Amedeo's current market capitalisation of around the £30 million mark. While rig builds take two to three years, Amedeo has secured immediate recurring income through its investment in MGR Resources.

Legendary is assisting Amedeo in various ways to add value rapidly and is pleased to have secured the investment at an early stage in a promising company. In addition, with both Amedeo and Legendary being investment companies, there may be opportunities for co-investments and deal flow.

OTHER INVESTMENTS

Manas Minerals LLC

In July 2012, Legendary invested £100,000 into Kyrgyzstan based Manas. Manas owns the Padsha Ata Licence to mine for coal in the Asksy region of Jalal-Abad. Soviet surveys suggest that the region contains 182 million tonnes of coal reserves of which 116 million is of coking coal quality. Legendary's investment is by way of a convertible loan note and a warrant.

Since the investment, various reports have been produced on the Manas coal formation which indicate that it is more intense and thicker than suggested by the Soviet era studies. In addition various discussions are taking place with respect to realising the investment.

Sula Iron and Gold PLC

In July 2012, Legendary invested £50,000 in a convertible loan note in a pre-IPO funding round for Sula Iron and Gold PLC. In October 2012, Sula was admitted to trading on AIM, and Legendary invested another £50,000 for further shares.

Sula is a multi-commodity exploration company focused on Sierra Leone and sub-Saharan Africa. Its current key objective is to explore and advance its 153 sq. km Ferensola Project in Northern Sierra Leone, which is highly prospective for iron and gold.

In order to maximise the value of its Ferensola licence, Sula has implemented a dual exploration programme, targeting both iron ore and gold resources. A scout drilling programme confirmed that Sula's flagship Ferensola asset hosts consistently high grade iron mineralisation, with best intersections of 14.59m at 55.54% Fe and 73.18m at 43.66% Fe. Sula is currently undertaking further infill drilling, with a view to defining a JORC compliant Direct Shipping Ore resource by the end of 2014.

 Additionally, an initial gold exploration programme commenced in Q4 2013 and was completed in February 2014. The results of this programme, received in April 2014, have enabled Sula to identify several drill targets, targeting hard rock gold mineralisation.

SRK Exploration Services Ltd, have estimated an exploration target of 500 million tonnes at 30.4% iron and have placed a maximum potential valuation for the iron ore and gold in Sula's Ferensola licence area at US$200 million.

Legendary continues to hold Sula. Current exploration results are promising, and should Sula prove its iron and gold resource, its value is likely to rise substantially. As of at the balance sheet date, Legendary's shares in Sula had a market value of £69,000.

Medgold Resources Corp.

Medgold Resources Corp. is a TSX-V listed gold exploration licence and project development company with a particular focus on Italy, Spain and Portugal. In July 2011, Legendary invested £50,000 in Medgold Resources Limited, which listed in December 2012 on the TSX-V in Canada thereby becoming Medgold Resources Corp.

Medgold, which is aiming to define 1 million ounces through the development of wholly-owned exploration assets, is run by a highly experienced management team with a successful and value accreting track record in the development of resource companies. Medgold's current portfolio consists of an extensive pipeline containing multiple projects which the Medgold Board believes fit within Medgold's project parameters.

Medgold acquired Klondike Gold Corp's Portuguese exploration assets in January 2014. This has allowed Medgold to control most of the highly prospective Valongo Belt in addition to their existing Boticas and Vila de Rei, Pietratonda, Galician Hercynican Massif and Pinzas Gold projects. The Boticas project is progressing strongly and the identification of a new zone of gold mineralisation is enhancing the commercial prospects of the investment. These findings are validating Medgold's strategy.

Legendary continues to hold Medgold. Should Medgold achieve its targets, its value is likely to rise substantially. As of at the balance sheet date, the market value of Legendary's shares in Medgold was £74,000.

Regency Mines PLC

Regency is a mineral exploration and development company focusing on nickel and cobalt in Papua New Guinea (alongside JV partner Direct Nickel) and gold, flake graphite and base metals in Australia. Legendary invested £50,000 in Regency in July 2012. At the time of the investment, Regency provided exposure to several projects including the lignite project in South Eastern Pakistan being developed by Oracle Coalfields PLC. Regency has not performed as expected, and in May 2013 it disposed of its stake in Oracle. As a result of this, Legendary made a decision to exit Regency. This process was completed, post balance sheet, in June 2014, and the proceeds were invested into Oracle.

Oracle Coalfields PLC

Oracle is a coal developer whose primary asset is the Thar Coalfield Block VI licence area located in the Sindh Province, south-eastern Pakistan, a 1.4 billion tonnes resource with 529 million tonnes JORC mineral resource and 113 million tonnes JORC proven reserves within the mining area of the licence. Oracle is in the process of developing the resource in collaboration with partners, including a Chinese consortium. Should it succeed in this, its value should rise substantially. As of at the balance sheet date, the market value of Legendary's shares in Oracle was £21,000.

FINANCIAL REVIEW

During the year, Legendary made a net gain on investments of £1,119,000 (2013: £38,000). This was primarily due to the gain on the Virtualstock equity and derivative stakes, although there were also gains and losses on other investments.

Administrative costs were £214,000 (2013: £196,000).

The Company has a policy of keeping administrative costs as low as practicable and aligning director interests with shareholder interests, keeping cash remuneration for directors at a minimum unless profitable realisations of investments are made. Of the £214,000 (2013: £196,000) of administrative costs, share based payments accounted for £48,000 (2013: £15,000), leaving cash administrative costs as £166,000 (2013: £181,000). In line with Legendary's policy of aligning shareholder and director interests, 180,000,000 (2013: 50,000,000) out of the money options with an exercise price of 0.2 pence and ten year life were granted to the Directors. In addition each Director received £1,200, or a total of £2,400 (2013: £23,230) of cash remuneration.

Within the remaining £164,000 (2013: £158,000) of administrative costs, certain costs rose (primarily subscriptions, accountancy and audit fees) while other costs fell (primarily travel) reflecting the various activities undertaken by the Company.

The operating profit was £905,000 (2013 loss: £158,000). There were £4,000 of finance charges (2013: £nil) as a result of Legendary taking out a short term loan of US$250,000 (see below and note 10). The profit before taxation for the year was £901,000 (2013 loss: £158,000).

As at the year end, Legendary's investments (fixed asset investments and current asset investments) were recorded at £1,628,000 (2013: £509,000), an increase of 210%.

Debtors due within one year were £39,000 (2013: £10,000 excluding £25,000 of the debtors due within one year which was attributable to cash balances held in the client account of Legendary's accountants). As at the balance sheet date, debtors due within one year included a short term loan to Virtualstock of £38,000 (2013: nil).

Cash amounted £63,000 (2013: £126,000 of cash, including £25,000 held in the client account of Legendary's accountants).

As at the year end, creditors falling due within one year increased to £199,000 (2013: £65,000). This was primarily due to Legendary taking out a short term loan of US$250,000 bearing interest at 10% per annum (note 10).

Overall, net and total assets for the year were £1,503,000 (2013: £554,000) an increase of 171%, and £1,732,000 (2013: £649,000), an increase of 167%, respectively.

Post balance sheet, in May 2014, Legendary raised £900,000 (before expenses), by way of a placing of 818,181,817 ordinary shares of 0.10 pence nominal value each at a price of 0.11 pence per new ordinary share. The shares were placed with a range of institutional and private investors.

Zafar Karim subscribed for 22,727,273 new ordinary Shares for £25,000 at the placing price. Zafar Karim's resultant interest in the Company was 55,727,273 ordinary shares, representing 2.3% of the Company's share capital as enlarged by the placing.

Following admission of the new ordinary shares, the Company's enlarged issued share capital was 2,461,530,833 ordinary shares

Legendary applied £392,000 of the funds to exercise options over shares in Virtualstock thereby raising Legendary's stake from 2.2% to 5.6% of the share capital of Virtualstock.

As at 18 July 2014, Legendary had cash and listed investments of £783,000.

MISCELLANEOUS

As part of the development of the Company, early in the year under review, in April 2013, Legendary launched a new, more informative website. In addition, in November 2013, Legendary appointed Beaufort Securities Limited as joint broker.

OUTLOOK

The year under review has been a highly successful one in in which substantial progress has been made, particularly in the principal investments. Post the year end, the Virtualstock valuation achieved for the fund raise demonstrated the returns that Legendary is able to generate. Moreover, the Board believes that this is just the beginning of the journey for Virtualstock. Post year end, Bosques successfully cultivated an additional 7 ha with G4J Jatropha, and Amedeo also achieved the milestone of laying the keel on Explorer 1. Legendary's KPIs, its net and total assets, point to this being a landmark year: net and total assets as at the year end were £1,503,000 (2013: £554,000), an increase of 171%, and £1,732,000 (2013: £649,000), an increase of 167%, respectively. These results both demonstrate and vindicate Legendary's proactive investment strategy.

The Board looks confidently to the future.

Extracts of the audited results appear below and a full version will be available on the Company's website www.legendaryinvestments.co.uk

For further information, please contact:

About Legendary Investments Plc

Legendary Investments Plc is a proactive investment company that focuses on making investments in and assisting companies which exhibit the potential to generate returns of many multiples through capital appreciation. Typically, Legendary invests in small companies where there are clear catalysts for value appreciation and the companies are operating in sectors exhibiting long term growth. Examples of such sectors include technology, energy and natural resources.

For more information, visit www.leginvest.com

Profit and Loss Statement

A separate statement of recognised gains and losses has not been prepared as the Company has no recognised gains or losses in the current or prior period other than the gains noted above.

All activities derive from continuing operations.

Balance Sheet

Cash Flow Statement

The Company only has one class of business and only operates within the United Kingdom.

Other than the gross director's fees of £2,400 (2013: £23,230) accrued in the year there were no staff costs paid during the year (2013: £nil). The Company did not incur any social security costs in relation to the fees. With respect to directors' share based payments, see note 14.

As at 31 March 2014 the Company had losses of approximately £ 5.2m (2013: £6.2m) available to carry forward against future income. A deferred tax asset of £ £1.2m (2013: 1.4m) is not recognised in respect of these losses due to the uncertainty as to the utilisation of the losses in the foreseeable future.

Future tax charges will be dependent on the split of profits for tax purposes as between revenue and capital items, and the utilisation of losses incurred to date.

The average number of undiluted shares in issue during the year was 1,643,349,016. The fully diluted number of shares in issue during the year was 2,083,121,743.

7 FIXED ASSET INVESTMENTS (continued)

The Company holds more than 20% of the equity (and no other share or loan capital) of the following undertakings:-

Bosques Energeticos EBE S.A. de C.V. in which the Company has more than 20% interest, is not treated as an associated undertaking. All investments are measured at fair value through profit and loss as detailed in the accounting policy.

£37,500 of the other debtors as at 31 March 2014 represent a short term loan advanced to Virtualstock Holdings Limited for the purposes of the working capital. No interest on this loan is due to the Company as the whole of the loan amount advanced was, post the balance sheet date, offset against the exercise price of a warrant over equity in Virtualstock Holdings Limited.

£25,000 of other debtors as at 31 March 2013 represent cash balances held in the client account of the Company's accountant.

Due to their short term nature, the carrying value of debtors as above approximates to their fair value.

Trade creditors and accruals represent the Company's financial liabilities measured at amortised cost. Due to their short term nature, carrying value approximates to fair value.

The short term loan of US$250,000, equivalent to £152,000, was taken out in December 2013. The loan has a fixed term of 12 months payable on or before 31 December 2014. The loan carries a fixed interest of 10%. Interest accrued on the loan at balance sheet date totalled £4,000 and is included in accruals.

£30,000 was raised in August 2010 by way of a loan facility. The facility bears no interest and has no fixed date for repayment. The loan is not expected to be paid in the foreseeable future and therefore has been classified as due in more than one year as the Directors believe this most appropriately reflects the period over which the loan will be repaid. As part of the terms of the loan, Legendary granted 260,000,000 warrants over new ordinary shares at an exercise price of 0.1p per share. At the date the warrants were granted, the Company's share price was 0.075p. The warrants expire in August 2015. 

14 SHARE BASED PAYMENT

Share Options

The Company has unapproved and approved share option schemes in which the directors participate.

Under the Company's approved share option plan, the Company grants options and shares to certain directors and employees of the Company. If the options remain unexercised for a period of 10 years from the date of grant, the options lapse. The options are exercisable immediately on grant.

Details of Directors' outstanding share options as at the year ended are shown below.

Movements in ordinary share options outstanding

All options were exercisable at the end of the year.

14 SHARE BASED PAYMENT (continued)

Fair value

The fair value of the options is estimated at the date of grant using a Black-Scholes option pricing model that uses assumptions noted in the table below. No performance conditions were included in the fair value calculations.

The Company uses historical data to estimate option exercise and employee termination within the valuation model. Expected volatilities are based on implied volatilities as determined by simple average of a sample of listed companies base in similar sectors. The risk free rate for the period within the contractual life of the option is based on the UK gilt yield curve at the time of the grant.

The share based payment charged for the year was £48,000 (2013: £12,000). This is included in administrative expenses with in the profit and loss account.

Warrants

Other than the employee share options set out above, warrants have been granted with exercise prices and dates shown in the table below.

Movements in warrants outstanding

The fair value of warrants granted in the year was £nil (2013: £3,000).

14 SHARE BASED PAYMENT (continued)

Fair value

The fair value of the warrants is estimated at the date of grant using a Black-Scholes option pricing model that uses assumptions noted in the table below. No performance conditions were included in the fair value calculations.

Other Information

The market price of the Company's ordinary shares ranged from a high of 0.1800p to a low of 0.0650p during the year.

Fixed asset investments have been excluded in both periods to reflect more properly that these are not liquid resources.

Current asset investments of £nil (2013: £196,000) are disclosed on the face of the cash flow statement within management of liquid resources in 2014.

20 FINANCIAL INSTRUMENTS

Loans and receivables

Loans and receivables include cash at bank and in hand and other debtors. Financial liabilities at amortised cost include trade creditors, accruals and loans.

Borrowing facilities

At the year end the Company had no overdraft facility (2013: £nil).

20. FINANCIAL INSTRUMENTS (continued)

Capital Management

The Company is financed primarily with equity capital, which is then utilised to meet operating expenses and make investments. Investments are financed primarily from equity capital, though debt may be utilised where it is felt that it is prudent to do so.

Interest rate risk

The Company does have exposure to interest rate.

The Company has a loan at a fixed interest rate of 10% paid in two half yearly instalments. The interest rate is fixed for the term of the loan.

The Company does not hold any deposits as at the year end.

Currency risk

The Company makes investments in both UK and foreign companies. In addition, the companies in which the Company invests may or may not have exposure to foreign currency exposure. In this regard the Company has foreign currency exposure. Currency exposure is one the factors considered when making investments, and as such it is implicitly managed at the point of investment.

In addition, the Company has a loan denominated in US$ and is therefore exposed to the risk of £Sterling depreciating against the US$.

Liquidity risk

The Company makes investments in unlisted and listed entities. Consequently the Company is exposed to the liquidity risk to the extent that it may not be able to find buyers for its unlisted investments and liquidity in its listed investments may be low. Therefore there can be no certainty that the Company would be able to exit its investments.

Market risk

The Company monitors the value of its investments on a regular basis, and takes action to decrease or dispose of investments when it deems appropriate.

Credit risk

The bank account of the Company and of the client account held by PSB Accountants Limited is held with well established financial institutions of high quality credit standing.

Fair value hierarchy

Fair values have been measured at the end of the reporting period as follows -

All fixed asset investments are classified as level 3. The movement on level 3 assets are disclosed in note 7.

Financial assets and liabilities measured at fair value are disclosed using a fair value hierarchy that reflects the significance of the inputs used making the fair value measurements, as follows -

• Level 1 - Unadjusted quoted prices in active markets for identical asset or liabilities ('quoted prices'),

• Level 2 - Inputs (other than quoted prices in active markets for identical assets or liabilities) that are directly or indirectly observable for the asset or liability ('observable inputs'), or

• Level 3 - Inputs that are not based on observable market data ('unobservable inputs')

The Level 3 investments have been valued at the price of recent investment, net asset value or discounted cash flow based on post period end redemptions in line with the Company's accounting policies and IPEVG guidelines.

21. POST BALANCE SHEET EVENTS

Virtualstock Holding Limited

Post the balance sheet date, in April 2014, Virtualstock Holdings Limited raised £525,000 through an issuance of equity. The fundraising placed a post money value on Virtualstock Holdings Limited of £25.4 million. As part of the fund raise, the Company negotiated further warrants and options over shares of Virtualstock Holdings Limited representing 1.2% of the fully diluted equity. Consequently, in aggregate, following the fund raise, the Company's equity and derivative interest in Virtualstock Holdings Limited rose from 5.0% to 5.6% of the fully diluted equity of Virtualstock Holdings Limited.

Subsequent to the Company's fund raise (see below) in May 2014, in June 2014, the Company exercised all of its derivative instruments in Virtualstock Holdings Limited taking its equity holding in Virtualstock Holdings Limited from 2.2% to 5.6%. The aggregate exercise price was £392,000. Post the exercise and at Virtualstock Holdings Limited's the fund raise valuation, the Company's stake in Virtualstock Holdings Limited is valued at £1,489,000.

Fund Raise

Post balance sheet, in May 2014, the Company raised £900,000 (before expenses), by way of a placing of 818,181,817 ordinary shares of 0.10 pence nominal value each at a price of 0.11 pence per new ordinary share. The shares were placed with a range of institutional and private investors. Following admission of the new ordinary shares, the Company's enlarged issued share capital was 2,461,530,833 ordinary shares