Amala Foods Plc Regulatory News (DISH)

Amala Foods Plc

("Amala" or the "Company")

Half Yearly Financial Report for the Period Ending 30 September 2021

Amala Foods Plc (LON: DISH), a food technology company, is pleased to announce the publication of the Half Yearly Financial Report for the Period Ending 30 September 2021. The Report will shortly be available on the Company website www.eatamala.com and will be uploaded to the National Storage Mechanism. The Report is laid out below this announcement.

Enquiries:

Jonathan Morley-Kirk, Non-Executive Chairman

jmk@bigdish.com 

REPORT OF THE DIRECTORS

The Directors present the report together with the unaudited interim financial statements for the Group for the half-year ended 30 September 2021.

The Company

Amala Foods Plc (formerly BigDish Plc), the parent Company, is registered (registered number 121041) and domiciled in Jersey. It was incorporated on 11 April 2016.

Principal Activity and Business Review

The Company's principal activity during the period ended 30 September 2021 was a holding company, holding a Joint Venture plant-based food technology business in the Philippines, Amala Foods Inc with the Directors believe will be the value driver of the business going forward.

Amala Foods has made rapid progress with research and development with a number of plant-based products successfully progressing to the commercial phase. This was achieved at a fraction of the cost when compared to other participants in the sector.

In the weeks leading up to the publication of this report, the Company has received a number of unsolicited preliminary and non-binding approaches by companies in various sectors that command premium stock market ratings such as the Rare Earth Elements and technology sectors to utilize the Company's public listing which the Board has engaged constructively with. These approaches have indicated that should a deal be completed it would result in a 'see through' valuation for shareholders that is materially in excess of the Company's current market capitalization. The Board has discussed in general terms with key stakeholders regarding this possibility and feedback has been constructive and supportive. The Company will update the market should this progress further.

Results and Dividends

The results of the Group for the half-year ended 30 September 2021 show a loss before taxation of GBP 185,703 (30 September 2020 showed a loss of GBP 426,142).

No dividends have been paid during the half-year ended 30 September 2020 or during the comparative period.

Operational Activities

The Company's principal activity during the period ended 30 September 2021 was a holding company. The Group's principal activity during this period was to develop its Joint Venture plant-based food technology business in the Philippines, Amala Foods Inc. The Company announced completing the initial research and development phase and has entered the commercialisation phase and has started supplying its plant-based products. Whilst still at an early stage, the Directors believe this will be the value driver of the business going forward

Principal Risks and Uncertainties

The principal business risks that have been identified are as below.

COVID-19 Risks

The restaurant sector has experienced significant disruption from COVID-19. This has impacted the Company's business and continues to do so. The Company continues to monitor the impact of COVID-19 on an ongoing basis and expects that some of its restaurant partners may not remain in business as a result. The Company is assessing how best to utilise the BigDish technology platform for its future business activities in the light of the changing hospitality landscape due to the COVID-19 pandemic.

The Joint Venture company is expected to be impacted by COVID-19 due to lockdowns in the Philippines which may affect operations periodically and also delay ordering equipment and supplies.

Marketplace Risk

The Company is operating in a competitive market and faces competition from other companies who do or may in the future offer a similar service on similar terms. Competitors may have much greater access to capital than the Company and therefore may be able to bring products to market sooner.

If the Company is unable to attract sufficient and potential customers at the rate expected, the Company may be unable to successfully compete in the market which may have a material adverse impact on its future prospects.

Joint Venture Risk

The Company has entered a Joint Venture and formed Amala Foods, Inc. in the Philippines to use food technology to create plant-based products for restaurants and consumers. Whilst the Joint Venture partners are experienced in the food industry, the marketplace for plant-based products is competitive and there can be no guarantee that the Joint Venture will result in a profitable business venture.

Funding Risk

The Company has not reached breakeven due to the early stage of business development. This therefore requires that the Company raises additional capital periodically. There can be no guarantees that additional capital will be available when required.

Key Personnel Risk

The loss of/inability to attract key personnel could adversely affect the business of the Company. The Company is dependent on the experience and abilities of its Directors and certain Senior Managers and technology staff. If such individuals were to leave the Company, and the Company was unable to attract suitable experienced personnel to compensate for those departing, it could have a negative impact on the rate of growth of the business.

Compliance Risk

The Company may process personal data (names, emails and telephone numbers), which may be considered sensitive, as part of its business. The Company may be subject to investigative or enforcement action by regulatory authorities in the Company's countries of operations if it acts or is perceived to be acting inconsistently with the terms of its privacy policy, customer expectations or the law. The Company will continue to monitor its policies to ensure on-going compliance with the General Data Protection Regulation (GDPR) regulations.

Brexit Risk

The Company has not made contingency plans for risks associated with Brexit albeit this is not expected to impact the business given the locations of its current activities.

Any risks that may arise will be mitigated through on-going review by Management and reporting of KPIs to the Board for periodic review and strategy amendment as required.

Events after the Reporting Period

Refer note 9 of the unaudited interim financial statements.

Company Directors

The Directors note that the search for a replacement NED is on-going.

Share Capital

At 30 September 2021, the issued share capital of the Company stood at 373,620,823 - with no new shares having been issued during the period.

This Directors' Report was approved by the Board of Directors on 28 January 2022 and is signed on its behalf.

By Order of the Board

Jonathan Morley-Kirk

Chairman

28 January 2022 

CONSOLIDATED INCOME STATEMENT

For the half-year ended 30 September 2020

30 Sep 2021 30 Sep 2020

(unaudited) (unaudited)

Note GBP GBP

Income - -

Cost of sales - -

Gross profit - -

Administrative expenses (195,410) (515,875)

Interest income 9,707 -

Fair value gain 7 - 89,733

Loss before taxation (185,703) (426,162)

Income tax expense - -

Loss for the period 4 (185,703) (426,142)

Earnings per share:

Basic and diluted loss per share 6 (0.0005) (0.0012)

The accompanying notes form an integral part of these financial statements.

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

For the half-year ended 30 September 2021

 30 Sep 2021 30 Sep 2020

(unaudited) (unaudited)

Note GBP GBP

Loss for the period (185,703) (426,142)

Exchange difference on translating foreign operations* 4,016 (11,887)

Total comprehensive loss for the period (181,687) (438,029)

\* To be reclassified to Profit and Loss if the foreign entity is sold.

The accompanying notes form an integral part of these financial statements.

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

at 30 September 2021

30 Sep 2021 30 Sep 2020

(unaudited) (Re-stated unaudited)

Note GBP GBP

Non-current assets

Property, plant and equipment - 6,739

- 6,739

Current assets

Trade and other receivables 5 7,641 237,346

Cash and cash equivalents 198,253 156,424

205,894 393,770

Current liabilities

Trade and other payables (124,429) (170,219)

Borrowings - (13,403)

(124,429) (183,622)

Non-current liabilities

Trade and other payables - -

Borrowings (450,000) -

(450,000) -

Net assets/(liabilities) (368,535) 216,887

Equity

Issued share capital 6 6,215,525 6,444,670

Retained earnings (7,948,451) (7,267,334)

Other Reserves 8 1,364,391 1,039,551

Total equity (368,535) 216,887

The accompanying notes form an integral part of these financial statements.

These financial statements were approved by the Board of Directors.

Jonathan Morley-Kirk

Chairman

28 January 2022

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

at 30 September 2021

Share Retained Other Total Capital Earnings Reserves Equity

GBP GBP GBP GBP

At 31 March 2020 5,972,980 (6,816,192) 1,275,147 431,935

Prior period adjustment - (25,000) 112,961 87,961

Loss for the period - (426,142) - (426,142)

Other comprehensive income for the period - -  (11,887) (11,887) 

Total comprehensive income for the period - (426,142) (11,887) (438,029)

Warrants reserves - - (89,733) (89,733)

Shares to be issued - - (246,937) (246,937)

Issue of new ordinary shares (net) 471,690  - - 471,690

Total transactions with owners 471,690 (426,142) (348,557) (303,009)

At 30 September 2020 (/Re-stated/unaudited) 6,444,670 (7,267,334) 1,039,551 216,887

Loss for the period - (572,226) - (572,226)

Other comprehensive income for the period - -  15,159 15,159

Total comprehensive income for the period - (572,226) 15,159 (557,067)

Warrants reserves - -  89,733 89,733

Share options reserves - - 166,765 166,765

Shares to be issued reserve - - 125,979 125,979

Issue of new ordinary shares (net) - adjustment 10,484 - - 10,484

Share based payments - 76,812 (76,812) -

Total transactions with owners 10,484 (495,414) 320,824  (164,106)

At 31 March 2021 6,455,154 (7,762,748) 1,360,375 52,781

Loss for the period - (185,703) - (185,703)

Other comprehensive income for the period - - 4,016 4,016

Total comprehensive income for the period - (185,703) 4,016 (181,687)

Issue of new ordinary shares (net) (239,629) - - (239,629)

Total transactions with owners (239,629) (185,703) 4,016 (421,316)

At 30 September 2021 (unaudited) 6,215,525 (7,948,451) 1,364,391 (368,535)

The accompanying notes form an integral part of these financial statements. 

CONSOLIDATED CASH FLOW STATEMENT

For the half-year ended 30 September 2021

30 Sep 2021 30 Sep 2020

(unaudited) (unaudited)

Note GBP GBP

Cash flows from operating activities

Cash received from customers - -

Cash paid to suppliers & employees (187,934) (278,822)

Net cash from operating activities (187,934) (278,822)

Cash flows from financing activities

Loan repayments - (2,370)

Cash received from loan receivable - 50,000

Loan received 246,284

Net cash used in financing activities 246,284 46,730

Net increase (decrease) in cash 58,890 (231,192)

Cash and cash equivalents at start of period 139,633 387,616

Cash and cash equivalents at end of the period 198,523  156,424

The accompanying notes form an integral part of these financial statements.

NOTES TO THE FINANCIAL STATEMENTS

For the half-year ended 30 September 2021

1. BASIS OF PREPARATION AND ADOPTION OF INTERNATIONAL FINANCIAL REPORTING STANDARDS (IFRS)

The consolidated interim financial statements have been prepared in accordance with the recognition and measurement principles of International Financial Reporting Standards as endorsed by the European Union ("IFRS") and expected to be effective at the year-end of 31 March 2022. The accounting policies are unchanged from the financial statements for the year ended 31 March 2021. The interim financial statements, which have been prepared in accordance with International Accounting Standard 34 (IAS 34) as adopted by the European Union, are unaudited. Accounts for the year ended 31 March 2021, prepared in accordance with IFRS, have been filed. The Auditors' Report on these accounts was unqualified, but did include a material uncertainty in respect of going concern.

The consolidated interim financial statements are for the six months to 30 September 2021. The interim consolidated financial information does not include all the information and disclosures required in the annual financial statements and should be read in conjunction with the Group's annual financial statements for the year ended 31March 2021, which were prepared in accordance with IFRS's as adopted by the European Union.

2. GOING CONCERN

The Group made a consolidated loss in the half-year ended 30 September 2021 of GBP 185,703. At 30 September 2021, the consolidated cash held was GBP 198,523 and the Group had consolidated liabilities of GBP 574,429 which includes GBP 103,000 due to related parties. The related parties liabilities are expected to be settled via equity under the Company's salary sacrifice scheme.

The Company has entered into a short-term funding agreement for GBP540,000. As of the publication date of this report, GBP 450,000 has been drawn down. The Company announced after the period on 8 December 2021 that it had raised GBP 210,000 via an equity placing and a further GBP 100,000 of loan financing with a 12 month term at a fixed interest of 8% due at maturity. As of the publication date of this report the loan financing has yet to be drawn down. It is expected that this funding will extend the funding runway beyond the second quarter of 2022.

Whilst the company is confident that it can stretch the short-term funding beyond the second quarter of 2022, there remains material uncertainty and the company will require further funding at some point during the 12 months from the date of this report. The Financial Statements have been prepared on a Going Concern basis.

3. SEGMENTAL REPORTING

3.1 For the half-year ended 30 September 2021

3.2 For the half-year ended 30 September 2020

4. LOSS FOR THE PERIOD BEFORE TAX

30 Sep 2021 30 Sep 2020

(unaudited) (unaudited)

GBP GBP

Loss for the period has been arrived at after charging:

Directors remuneration 80,000 80,000

Staff costs 9,420 200,915

5. TRADE AND OTHER RECEIVABLES

30 Sep 2021 30 Sep 2020

(unaudited) (unaudited)

GBP GBP

Trade and Other Receivables 7,641 29,506

Loan Receivables - 207,840

Balance at end of period 7,641 237,346

All receivables are current assets and due within 12 months. GBP 50,000 repayment of the loan receivables was received by the Company in the half-year to 30 September 2020 and the balance of GBP 239,630 was cleared in the half-year to 30 September 2021.

6. SHARE CAPITAL

6.1 Share Capital

30 Sep 2021 30 Sep 2020

(unaudited) (Re-stated/unaudited)

Number GBP Number GBP

Opening balance 373,620,823 6,444,670 348,950,355 5,972,980

Adjustment - 31 March 2021 - 10,484 - -

Ordinary shares - new shares issued during the period - - 24,670,468 471,690

Loan receivables settlement - (239,629) - -

Closing balance 373,620,823 6,215,525 373,620,823 6,444,670

The shares have no par value. The Group holds 11,000,000 shares in treasury (30 September 2020, 11,000,000).

6.2 Earnings Per Share

Earnings per share is calculated by dividing the loss attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding and shares to be issued during the period.

In 2021 and 2020, the potential ordinary shares were anti-dilutive as the Group was in a loss making position and therefore the conversion of potential ordinary shares would serve to decrease the loss per share from continuing operations. Where potential ordinary shares are anti-dilutive a diluted earnings per share is not calculated and is deemed to be equal to the basic earnings per share.

The warrants noted in note 7 could potentially dilute EPS in the future.

7. SHARE WARRANTS

Warrants are denominated in Sterling and are issued for services provided to the Group or as part of the acquisition of a subsidiary. 

Warrants at 30 September 2021:

The charge for the period to 30 September 2021 is GBP Nil (30 September 2020: GBP Nil).

8. RESERVES

9. EVENTS AFTER THE REPORTING PERIOD

The Company announced on 8 December 2021 that it had raised GBP 210,000 via an equity placing.