Last checked at 30 Sep 2022 07:00
RiverFort Global Opportunities plc
("RGO" or the "Company")
Unaudited interim results for the 6 months ended 30 June 2022
RiverFort Global Opportunities plc is pleased to announce its unaudited interim results for the six months to 30 June 2022.
Highlights
· Total NAV of £11.5 million and NAV per share of 1.46 pence
· Smarttech247 actively progressing its London listing
· Around £1.7 million of cash available for further investment
· Increasing demand for the Company's investment capital
· Declaration of a dividend for 2021 of 0.038p per share, thereby continuing its track record of dividend payments
Philip Haydn-Slater, Non-Executive Chairman, commented:
"RGO has continued to generate investment income during this period and demand for its capital is growing against the background of difficult stock market conditions. The Company has broadly maintained its NAV in the first half of 2022 such that the Company's current share price now represents a 55% discount to its underlying NAV. Going forward, we believe that the Company has an attractive portfolio of investments which not only has the scope to achieve income with downside protection but the significant upside potential to generate capital gains from appropriate pre-IPO investments. In particular, Smarttech247 is actively progressing a stock market listing in Q4 2022 which is expected to generate an attractive return on investment."
Chairman's statement
The analysis of income for the period is set out below:
| Half year to 30 June 2022 | Year to 31 December 2021 |
£000 | £000 | |
Investment income | 417 | 1,801 |
Net income from financial instruments at FVTPL | (440) | 680 |
Net foreign exchange gains/(losses) on financial instruments | 104 | (12) |
Total investment income | 81 | 2,469 |
During the period, the Company generated total investment income of £417,000 from its investment portfolio. The Company principally invests by way of debt and/or equity-linked debt instruments which provides equity upside with downside protection Investment income is therefore principally generated from interest, fees, with additional income from equity conversion and warrants. Net income from financial instruments at FVTPL is derived from changes in the value of the Company's investment portfolio. An unrealised loss was recognised for the period due to the decrease in the share price of one of the Company's investments, Pires Investments plc ("Pires").
The Company's principal investment portfolio categories are summarised below:
Category | Cost or valuation at 30 June 2022 (£) |
Debt and equity- linked debt investments | 5,227,524 |
Pre IPO investments | 2,703,465 |
Equity and other investments | 1,960,469 |
Cash resources | 1,718,844 |
|
|
Total | 11,610,302 |
During the period, the Company has continued to develop its portfolio and, as at the period end, the value of these investments amounted to £5.2 million. The portfolio currently includes over 20 companies such as Jubilee Metals plc, Challenger Exploration Limited, Deepverge plc and Troy Resources Ltd.
The pre-IPO investment category principally comprises the Company's holdings in Smarttech247 and Pluto Digital plc.
Smarttech247 is a global artificial intelligence-based cyber security cloud business that protects enterprises from cyber-attacks. Smarttech247 has over 100 technology partners, including IBM and Microsoft, and more than 50 clients based in Europe and the US. The company has recently won a number of new clients and has just launched a new MDR product, Vision X. It is also actively progressing a stock market listing and the likely market valuation is expected to deliver a significant uplift to RGO's NAV. The value of this holding is currently held at a cost of €1.4 million.
Pluto Digital is a Web3 technology company with a focus on the Metaverse, blockchain gaming and NFTs. During the period, Pluto has been working with Maze Theory Limited ("Maze Theory"), a London-based digital entertainment studio, with a view to developing high quality games that incorporate token economics. Pluto is working on a corporate transaction which will include Emergent Games, a new Web3 gaming studio which is a joint venture with Maze Theory. A further announcement on the progress of this transaction is expected in Q4 2022.
As at 30 June 2022, the Company's equity holding in Pluto was valued at circa £1.3 million based on a price of 6 pence per share, which is the price at which the company's most recent funding raising took place and the price at which the corporate transaction with Maze is expected to take place.
The equity and other investments category principally comprises the Company's holdings in Pires and its warrant portfolio. Pires, is an investment company listed on AIM that invests in next generation technology companies. Pires recently announced its interim results which included a significant profit of circa £1 million and growth in NAV, principally as a result of the increase in value of one of its investments, Getvisibility. Pires continues to build a very attractive portfolio of investments.
On 1 June 2022, Tern plc ("Tern") announced a recommended share offer which valued each share in Pires at 8 pence based on the closing price of Tern shares on 31 May 2022 and represented a premium of 53.8% to the closing price of a Pires share on 31 May 2022. In July 2022, the recommended offer for Pires by Tern plc, whilst being supported by the majority of Pires shareholders voting both by number of shareholders and number of shares held, was not approved by the requisite number to effect a scheme of arrangement, and therefore lapsed.
During the period, the Pires share price decreased by 37% which is the principal reason for the small reduction in RGO's NAV.
As previously announced, as part of the Company's overall strategy when making investments, warrants or their equivalent are negotiated which can significantly increase the level of investment return. However, due to the inherent volatility associated with this form of instrument, the potential value of this warrant portfolio is not fully reflected in the Company's net asset value and a return is only crystallised when the respective warrants are exercised and resulting shares sold.
The key unaudited performance indicators are set out below:
Performance indicator | 30 June 2022 | 31 December 2021 | Change |
Investment income | £80,705 | £2,469,446 | |
Net asset value | £11,466,525 | £11,748,821 | -2.4% |
Net asset value - fully diluted per share | 1.46p | 1.49p | -2.2% |
Closing share price | 0.91p | 1.45p | -37.2% |
Market capitalisation | £7,056,000 | £11,243,000 | -37.2% |
The Company has continued to maintain a significant cash balance as at the end of the period for further investment and enabling the Company to pay a dividend for 2021 which was declared on 8 July 2021. The gross dividend amounted to 0.038 pence per share, equivalent to a gross yield of 5.8% at the current share price.
Philip Haydn-Slater
Non-Executive Chairman
29 September 2022
This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with the Company's obligations under Article 17 of MAR.
For more information, please contact:
RiverFort Global Opportunities plc: +44 (0) 20 3368 8978
Philip Haydn-Slater, Non-Executive Chairman
Nicholas Lee, Investment Director
Nominated Adviser:
Beaumont Cornish +44 (0) 20 7628 3396
Roland Cornish/Felicity Geidt
Joint Broker: +44 (0) 20 7601 6100
Shard Partners LLP
Damon Heath/Erik Woolgar
Joint Broker: +44 (0) 20 7562 3351
Peterhouse Capital Limited
Lucy Williams
UNAUDITED STATEMENT OF COMPREHENSIVE INCOME
FOR THE SIX MONTHS ENDED 30 JUNE 2022
Unaudited 6 months ended 30 June 2022 | Unaudited 6 months ended 30 June 2021 | Audited Year ended 31 December 2021 | |
£ | £ | £ | |
Investment income | 417,476 | 909,485 | 1,801,432 |
Net (loss)/gain from financial instruments at FVTPL | (440,460) | 1,115,767 | 680,286 |
Foreign exchange gains/(losses) on financial instruments | 103,689 | (12,160) | (12,272)
|
Total income | 80,705 | 2,013,092 | 2,469,446 |
Administration expenses | (170,371) | (226,296) | (715,195) |
Investment advisory fees | (214,879) | (367,357) | (593,990) |
Exchange translation gains/(losses) | 22,249 | (38,836) | (120,249) |
(Loss)/profit before taxation | (282,296) | 1,380,603 | 1,040,012 |
Taxation | - | - | - |
(Loss)/profit for the period and total comprehensive (expense)/income | (282,296) | 1,380,603 | 1,040,012 |
| |||
| |||
Basic (loss)/earnings per share | |||
Continuing and total operations | (0.04p) | 0.20p | 0.14p |
Fully diluted (loss)/earnings per share | |||
Continuing and total operations | (0.04p) | 0.20p | 0.14p |
UNAUDITED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTHS ENDED 30 JUNE 2022
Called up share capital | Share premium account | Share options reserve |
Retained earnings |
Total equity | |
£ | £ | £ | £ | £ | |
| |||||
Balance at 1 January 2021 | 67,893 | - | - | 9,172,043 | 9,239,936 |
Profit for the year and total comprehensive income | - | - | - | 1,040,012 | 1,040,012 |
Share issue | 9,647 | 1,568,353 | - | - | 1,578,000 |
Grant of share options | - | - | 201,034 | - | 201,034 |
Dividend payment | - | - | - | (310,161) | (310,161) |
| |||||
Balance at 31 December 2021 | 77,540 | 1,568,353 | 201,034 | 9,901,894 | 11,748,821 |
Loss for the period and total comprehensive expense | - | - | - | (282,296) | (282,296) |
| |||||
Balance at 30 June 2022 | 77,540 | 1,568,353 | 201,034 | 9,619,598 | 11,466,525 |
UNAUDITED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2022
| Unaudited 6 months ended 30 June 2022 | Unaudited 6 months ended 30 June 2021 | Audited Year ended 31 December 2021 |
| £ | £ | £ |
| |||
ASSETS | |||
Non-current investments | |||
Financial asset investments | 7,434,772 | 8,608,261 | 8,105,633 |
Total non-current assets | 7,434,772 | 8,608,261 | 8,105,633 |
Current assets | |||
Financial asset investments | 2,456,686 | 2,987,433 | 2,966,515 |
Trade and other receivables | 299,102 | 174,305 | 317,539 |
Cash and cash equivalents | 1,718,844 | 1,919,017 | 2,012,483 |
Total current assets | 4,474,632 | 5,080,755 | 5,296,537 |
| |||
Total assets | 11,909,404 | 13,689,016 | 13,402,170 |
LIABILITIES | |||
Current liabilities | |||
Trade and other payables | 442,879 | 1,490,477 | 1,653,349 |
Total current liabilities | 442,879 | 1,490,477 | 1,653,349 |
Net assets | 11,466,525 | 12,198,539 | 11,748,821 |
EQUITY | |||
Share capital | 77,540 | 77,540 | 77,540 |
Share premium account | 1,568,353 | 1,568,353 | 1,568,353 |
Share options reserve | 201,034 | - | 201,034 |
Retained earnings | 9,619,598 | 10,552,646 | 9,901,894 |
| |||
Total equity | 11,466,525 | 12,198,539 | 11,748,821 |
|
UNAUDITED STATEMENT OF CASH FLOWS
FOR THE SIX MONTHS ENDED 30 JUNE 2022
| Unaudited 6 months ended 30 June 2022 | Unaudited 6 months ended 30 June 2021 | Audited Year ended 31 December 2021 |
£ | £ | £ | |
Cash flows from operating activities | |||
Investment income received | 43,938 | 999,097 | 1,195,653 |
Operating expenses paid | (244,386) | (674,447) | (1,091,429) |
Net cash (outflow)/inflow from operating activities | (200,448) | 324,650 | 104,224 |
Cash flows from investing activities | |||
Purchase of investments | (2,807,144) | (6,369,758) | (9,618,440) |
Proceeds from disposal of investments | 27,316 | 472,664 | 493,332 |
Debt instrument repayments | 2,582,948 | 1,878,765 | 5,730,944 |
Net cash used in investing activities | (196,880) | (4,018,329) | (3,394,164) |
| |||
FINANCING ACTIVITIES | |||
Net proceeds from share issues | - | 1,578,000 | 1,578,000 |
Dividend payment | - | - | (310,161) |
Net cash from financing activities | - | 1,578,000 | 1,267,839 |
| |||
Net decrease in cash and cash equivalents | (397,328) | (2,115,679) | (2,022,101) |
Cash and cash equivalents at beginning of period | 2,012,483 | 4,046,856 | 4,046,856 |
Effect of foreign currency exchange on cash | 103,689 | (12,160) | (12,272) |
Cash and cash equivalents at end of period | 1,718,844 | 1,919,017 | 2,012,483 |
NOTES TO THE INTERIM REPORT
1. The financial information set out in this interim report does not constitute statutory accounts as defined in section 434 of the Companies Act 2006. The group's statutory financial statements for the period ended 31 December 2021, prepared under International Financial Reporting Standards (IFRS), have been filed with the Registrar of Companies. The auditor's report on those financial statements was unqualified and did not contain a statement under section 498 (2) or (3) of the Companies Act 2006.
The interim financial information has been prepared in accordance with the recognition and measurement principles of International Financial Reporting Standards (IFRS) and on the same basis and using the same accounting policies as used in the financial statements for the year ended 31 December 2021. The interim financial statements have not been audited or reviewed in accordance with the International Standard on Review Engagement 2410 issued by the Auditing Practices Board.
The financial statements have been prepared on a going concern basis under the historical cost convention.
The Directors believe that the going concern basis is appropriate for the preparation of the financial statements as the Company is in a position to meet all its liabilities as they fall due.
2. Earnings per share
Earnings per share is calculated by dividing the profit/(loss) attributable to equity shareholders by the weighted average number of shares in issue.
| Six months ended 30 June 2022 (unaudited) | Six months ended 30 June 2021 (unaudited) |
Year ended 31 December 2021 (audited) |
(Loss)/profit from continuing and total operations | (£282,296) | £1,380,603 | £1,040,012 |
Weighted average number of shares in the period for basic earnings |
775,404,187 |
706,115,920 | 741,044,800 |
Weighted average number of shares in the period for fully diluted earnings |
775,404,187 |
706,115,920 | 751,278,700 |
Basic and fully diluted (loss)/earnings per share: | |||
Basic (loss)/earnings per share from continuing and total operations | (0.04p) | 0.20p | 0.14p |
Fully diluted (loss)/earnings per share from continuing and total operations | (0.04p) | 0.20p | 0.14p |
For the current period exercise of the outstanding warrants would be anti-dilutive for earnings per share, so the weighted average number of shares in issue is the same for both basic and fully diluted earnings per share calculations. | |||
3. Copies of the interim report can be obtained from: The Company Secretary, RiverFort Global Opportunities plc, Suite 39, 18 High Street, High Wycombe, Buckinghamshire, HP10 8NJ and are available to view and download from the Company's website : www.riverfortglobalopportunities.com