Tmt Investments Regulatory News (TMT)

21 April 2015

TMT INVESTMENTS PLC

("TMT" or the "Company")

Final results for the year ended 31 December 2014

TMT Investments PLC, which invests in high-growth, internet-based companies across a variety of sectors, is pleased to announce its final results for the year ended 31 December 2014.

· US$1.36 NAV per share (up from US$1.30 as of 31 December 2013)

· TMT has now invested in just under 40 companies since its floatation in December 2010

· Diversified portfolio of investees focused around mobile software applications, cloud solutions, advertising technologies, social discovery shopping, and business SaaS tools

· Successful capital raise of US$2.65 million at US$1.85 per share

· US$3.37 million invested in eleven new companies

· Additional US$0.95 million invested in four existing portfolio companies

· A number of significant positive portfolio revaluations expected in 2015

Alexander Selegenev, Executive Director of TMT, commented:

"2014 was our fourth full year as a publicly traded company. During the year, we reviewed dozens of opportunities and invested US$3.37 million in eleven new companies. Our current portfolio includes 32 investees, providing a good level of diversification.

In 2014, the portfolio had one profitable cash exit (The One-Page Company, Inc.), two positive non-cash revaluations (Gild, Inc. and Backblaze, Inc.), one impairment (Graphicly, Inc.) and one negative non-cash revaluation (UsingMiles, Inc.).

Although 2014 turned out relatively uneventful for TMT in terms of number of exits and revaluations, a significant number of our portfolio companies have experienced rapid growth. In addition, a number of our investees are currently in the process of completing follow-on capital raises at notably higher valuation levels, so we expect a number of positive revaluations of our portfolio holdings in 2015. At the same time, given the risky nature of earlier-stage venture capital investments, we expect some negative revaluations in due course as well.

We continue to see exciting investment opportunities in our sector and look forward to updating our shareholders on the Company's progress in the near future."

The Annual Report and Accounts for the year ended 31 December 2014 are available on the Company's website at www.tmtinvestments.com, where an electronic copy can be accessed.

For further information contact:

EXECUTIVE DIRECTOR'S STATEMENT

2014 has been a relatively quiet year for the Company, with only a limited number of revaluations across our portfolio. As a result, our NAV per share as of 31 December 2014 increased only slightly to US$1.36 (from US$1.30 as of 31 December 2013). TMT has now invested in just under 40 companies since its floatation in December 2010 and has a diversified portfolio of investees focused around mobile software applications, cloud solutions, advertising technologies, social discovery shopping and business SaaS tools.

Portfolio Performance

Similarly to previous years, the biggest "reporting challenge" faced by the Company in 2014 was due to the fact that the majority of our investments are made in earlier-stage, privately held companies, which do not have a sufficiently long history of earnings. This means that, regardless of how impressively (or otherwise) some of our portfolio companies may have grown in terms of revenue and operating metrics, changes in fair value of our portfolio companies cannot be justified under the IFRS rules unless there has been an independent equity financing round or other measurable reliable evidence to support a change in the valuation. We hope that the growing number of investee companies will increase the chances of more regular revaluations across our portfolio in the future.

In 2014, the following developments took place in the Company's portfolio:

Cash and part-cash exits:

· In August 2014, the Company sold its entire equity stake in The One-Page Company, Inc. ("One-Page"). TMT's total consideration received pursuant to the transaction was US$509,740, representing an internal rate of return ("IRR") of 32%. TMT originally invested US$250,000 in One-Page in February 2012.

Positive non-cash revaluations:

· In May 2014, Gild, Inc. ("Gild"), a proprietary IT talent sourcing and candidate relationship management platform, completed a new equity financing round. The transaction represents an uplift of approximately US$379,000 (or 223%) in the fair value of TMT's investment in Gild, compared to the amount reported as of 31 December 2013.

· Based on the results of an independent valuation report commissioned by Backblaze, Inc. ("Backblaze"), the fair value of TMT's equity stake in Backblaze has increased by approximately US$1.19 million (or 24%), compared to the amount reported as of 31 December 2013.

Impairments and write-offs:

· In May 2014, Graphicly, Inc. ("Graphicly"), an e-book publishing and distribution platform, announced its decision to wind up its operations. As a result, the fair value of TMT's investment in Graphicly has reduced by approximately US$345,000 (or 70%), compared to the amount reported as of 31 December 2013.

Negative non-cash revaluations:

· In October 2013, Universal Points Exchange, LLC, a wholly owned subsidiary of Source, Inc. ("Source") and Help Worldwide, Inc. ("HelpWW"), agreed to acquire the assets of UsingMiles Inc. ("UM") for shares. A UM liquidating trust ("Trust") has been established for the purposes of the transaction. The transaction closed on 31 December 2013, and TMT agreed to be included in the Trust on 11 August 2014. The transaction represents a reduction of approximately US$230,000 (or 89%) in the fair value of TMT's investment in UM, compared to the amount reported as of 31 December 2013.

Key developments for the 10 largest portfolio holdings in 2014 (compared to 2013; source: TMT's portfolio companies)

Adinch (online advertising platform):

· Joined the Plug and Play incubator program in the USA

· Six new advertising platforms integrated

· US$1.7m new equity raised

Anews (news reading app):

· Monthly active users up 301%

· Over 2m total app downloads

· Reached top 3 in the "News" category in AppStore and Google Play

· Monetization started in Q4 2014

· US$2.7m new equity raised

AppsIndep (online games developer):

· Revenues below expectations

· Seeking additional capital

Backblaze (online data backup provider):

· Revenues up 43%

· Total number of licensed computers up 54%

Depositphotos (photobank):

· Revenues up 42%

· Total number of authors up 19%

· Total number of files in the photobank up 50%

Pipedrive (sales CRM software):

· Revenues up 115%

· Total paying customers up 118%

rollApp (provider of access to 3rd party apps from any browser):

· Total applications available on the platform up 100%

· Premium subscription plan launched

· Several file storage services integrated

· "Awesome File Opener" plugin for Chrome and Mozilla browsers released

Unicell (Provider of digital marketing solutions and mobile applications and services):

· Remained marginally profitable, but highly overleveraged

Wanelo (online social shopping platform):

· Over 350,000 stores and 20 million products on the platform

· Total subscribers up 27%

· In-app purchases launched

Wrike (project management and collaboration software):

· Revenues up 107%

· Total number of paid accounts up 47%

New investments

In 2014 the Company invested US$3.37 million in eleven new companies (technology developer for visually impaired people PROvision/Oriense; smartphone solution provider for senior citizens E2C; mobile tech discovery service Drippler; on-demand business research platform Whale Path; "Internet of Everything" software developer Weaved; business productivity SaaS provider PandaDoc; fashion rental platform for women Le Tote; news reading app Anews; social intelligence platform Twtrland; mobile interface app Drupe; and taxi booking app Taxify), as well as an additional US$950,000 in four existing portfolio companies (Gentoo/Contacts+, rollApp, KitApps/Attendify, and Adinch).

NAV per share

The Company's net asset value per share as of 31 December 2014 increased to US$1.36 (31 December 2013: US$1.30).

Operating Expenses

In 2014, the Company's Administrative Expenses of US$1,382,874 were generally in line with 2013 levels (US$1,293,538). Total Operating Expenses decreased in the reporting period due to the lower share-based option charge of US$166,282 (2013: US$576,207). This is a non-cash item resulting from the Company's share option program adopted in October 2012.

Financial position

In July 2014, TMT raised US$2.65 million at US$1.85 per share from a number of new and existing investors. As of 31 December 2014, the Company had US$2.6 million in cash reserves. As of the date of this report, the Company has no debt and approximately US$2 million in cash reserves.

Events after the reporting period

In February 2015, TMT's portfolio company Drippler, a mobile tech discovery service, completed a new sizable equity financing round. The transaction represents an uplift of approximately US$97,000 (or 48%) in the fair value of TMT's investment in Drippler, compared to the amount announced as of 30 June 2014.

In April 2015, the Company invested US$300,000 in fragrance subscription service ScentBird.

Outlook

Although 2014 turned out relatively uneventful for TMT in terms of number of exits or revaluations, a significant number of our portfolio companies have experienced rapid growth. In addition, a number of our investees are currently in the process of completing follow-on capital raises at notably higher valuation levels, so we expect a number of positive revaluations of our portfolio holdings in 2015. At the same time, given the risky nature of earlier-stage venture capital investments, we expect some negative revaluations in due course as well.

We look forward to updating our shareholders on the Company's progress in the near future.

Alexander Selegenev

Executive Director

Statement of Comprehensive Income

Statement of Financial Position

Statement of Cash Flows

Statement of Changes in Equity

For the year ended 31 December 2014 and for year ended 31 December 2013, USD

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2014

1. Company information

TMT Investments Plc ("TMT" or the "Company") is a company incorporated in Jersey with its registered office at Queensway House, Hilgrove Street, St Helier, JE1 1ES, Channel Islands.

The Company was incorporated and registered on 30 September 2010 in Jersey under the Companies (Jersey) Law 1991 with registration number 106628 under the name TMT Investments Limited. The Company obtained consent from the Jersey Financial Services Commission pursuant to the Control of Borrowing (Jersey) Order 1985 on 30 September 2010. On 1 December 2010 the Company re-registered as a public company and changed its name to TMT Investments PLC.

The memorandum and articles of association of the Company do not restrict its activities and therefore it has unlimited legal capacity. The Company's ability to implement its Investment Policy and achieve its desired returns will be limited by its ability to identify and acquire suitable investments. Suitable investment opportunities may not always be readily available.

The Company will seek to make investments in any region of the world.

Financial statements of the Company are prepared by and approved by the Directors in accordance with International Financial Reporting Standards, International Accounting Standards and their interpretations issued or adopted by the International Accounting Standards Board as adopted by the European Union ("IFRSs"). The Company's accounting reference date is 31 December.

2. Summary of significant accounting policies

2.1 Basis of presentation

The principal accounting policies applied by the Company in the preparation of these financial statements are set out below and have been applied consistently.

The financial statements have been prepared on a going concern basis, under the historical cost basis as modified by the fair value of available-for-sale financial assets, as explained in the accounting policies below, and in accordance with IFRS. Historical cost is generally based on the fair value of the consideration given in exchange for assets.

2.2 Going concern

The Directors confirm that, after giving due consideration to the financial position and expected cash flows of the Company; they have a reasonable expectation that the Company will have adequate cash resources to continue in operational existence for the foreseeable future, and for at least one year from the date of approval of these financial statements and they have therefore adopted the going concern basis in preparing the financial statements.

2.3 Segmental reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker who is responsible for allocating resources and assessing performance of the operating segments and which has been identified as the Board of Directors that make strategic decisions. For the purposes of IFRS 8 'Operating Segments' the Company currently has one segment, being 'Investing in the TMT sector'.

Even though the Company only has one segment, there are still geographical disclosures that need to be made to comply with IFRS 8 'Operating Segments'.

The Company analyses revenue and non-current financial assets according to the geographical location of the investment (see note 4).

2.4 Foreign currency translation

(a) Functional and presentation currency

Items included in the financial statements of the Company are measured in United States Dollars ('US dollars', 'USD' or 'US$'), which is the Company's functional and presentation currency.

(b) Transactions and balances

Foreign currency transactions are translated into US$ using the exchange rates prevailing at the dates of the transactions. Exchange differences arising from the translation at the year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the statement of comprehensive income.

2.5 Cash and cash equivalents

Cash and cash equivalents consist of cash at bank and in hand, deposits held at call with banks, bank overdrafts and other short-term highly liquid investments with maturities of three months or less from the date of acquisition.

2.6 Financial assets

Recognition and measurement

Investments are recognized and de-recognized on a date where the purchase or sale of an investment is under a contract whose terms require the delivery or settlement of the investment. The Company manages its investments with a view to profiting from the receipt of dividends and changes in fair value of equity investments.

"Available-for-sale" financial instruments include unlisted equity investments and convertible promissory loan notes. Equity instruments classified as available-for-sale are those which are neither classified as held-for-trading nor designated as fair value through profit or loss. Convertible promissory loan notes are treated as similar in nature to the unlisted equity investments and designated as available-for-sale.

Available-for-sale investments are carried at fair values except for financial assets that do not have a quoted market price in an active market and whose fair value cannot be reliably measured which are measured at cost less any identified impairment losses at the end of the period in accordance with the IAS 39 para 46 (c) exemptions. Fair value information has therefore not been disclosed for those investments.

Where there has been a relevant transaction during the year that gives an indication of the fair value of the available-for-sale unlisted shares, the shares are included at that fair value and the increase or decrease in fair value is recognised in the investment fair value reserve. The "price of recent investment" methodology is used mainly for investments in venture capital companies and includes cost of investment or valuation by reference to a subsequent financing round. Valuation increases above cost are only recognised if that round involved a new external investor and the company is meeting milestones set by investors.

Investments are classified on recognition as "fair value through profit and loss" when their fair values can be estimated reliably on a regular basis and when they are managed on a fair value basis. Fair value changes of investments at fair value through profit and loss are included within profit/loss in the income statement. At 31 December 2014 all investments are classified as "available-for-sale" and none are classified as "fair value through profit and loss".

Financial assets that qualify as an associate as 20% or more of the voting rights are held by the company, are exempt from IAS 28 'Investments in Associates', as TMT Investments plc is a venture capital organisation. Such investments are therefore treated as available-for-sale financial assets.

Income

Interest income from convertible notes receivable is recognized as it accrues by reference to the principal outstanding and the effective interest rate applicable, which is the rate that exactly discounts the estimated future cash flows through the expected life of the financial asset to the asset's carrying value.

Impairment of available-for-sale financial assets

A financial asset is considered to be impaired if objective evidence indicates that one or more events have had a negative effect on the estimated future cash flows of that asset. In case of available for sale assets, a significant or prolonged decline in the fair value of the financial asset below its cost is considered an indicator that the financial assets are impaired.

If objective evidence indicates that financial assets that are carried at cost need to be tested for impairment, calculations are based on information derived from business plans and other information available for estimating their fair value. Any impairment loss is included in profit/loss for the year in the Statement of Comprehensive Income.

2.7 Net finance income

Net finance income comprises interest income on deposits. Interest income is recognized as it accrues in the statement of comprehensive income, using the effective interest method. Finance costs comprise interest expenses on borrowings and the unwinding of the discount on provisions.

2.8 Taxation

Deferred tax is provided in full using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. Deferred tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that, at the time of the transaction, affects neither accounting nor taxable profit or loss. Deferred tax is determined using tax rates that are expected to apply when the related deferred tax asset is realised or when the deferred tax liability is settled. Deferred tax assets are recognised to the extent that it is probable that future taxable profits will be available against which the temporary differences can be utilised.

2.9 Equity instruments

Ordinary shares are classified as equity. Costs directly attributable to the issue of new shares are shown in equity as a deduction from the proceeds.

2.10 Share-based payments

The fair value of options granted to employees is recognized as an employee expense, with a corresponding increase in equity, over the period that the employees become unconditionally entitled to the options. The amount recognized as an expense is adjusted to reflect the actual number of share options that vest. For equity settled share-based payment transactions other than transactions with employees the Company measures the goods or services received at their fair value, unless that fair value cannot be estimated reliably. If this is the case the Company measures their fair values and the corresponding increase in equity, indirectly, by reference to the fair value of equity instruments granted.

The Company enters into arrangements that are equity-settled share-based payments with certain employees. These are measured at fair value at the date of grant, which is then recognized in the statement of comprehensive income on a straight-line basis over the vesting period, based on the Company's estimate of shares that will eventually vest. Fair value is measured by use of an appropriate model. In valuing equity-settled transactions, no account is taken of any vesting conditions, other than conditions linked to the price of the shares of TMT Investments. The charge is adjusted at each year end date to reflect the actual number of forfeitures, cancellations and leavers during the period. The movement in cumulative charges since the previous year end is recognized in the statement of comprehensive income, with a corresponding entry in equity.

2.11 New IFRSs and interpretations not applied

The IASB has issued the following standards and interpretations which have been endorsed by the European Union to be applied to financial statements with periods commencing on or after the following dates:

There is no material impact on the financial statements of the application of new standards with an effective date of 1 January 2014. The Directors do not anticipate that the adoption of other standards and interpretations will have a material impact on the financial statements in the period of initial application and have decided not to adopt any of them early.

2.12 Accounting estimates and judgements

Estimates and judgements need to be regularly evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The Company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, rarely equal the related actual results.

The estimates and underlying assumptions are reviewed on an on-going basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future periods.

The estimates significant to the financial statements during the year and at the year-end is the consideration of the fair value of available-for-sale assets, the impairment of available-for-sale assets and share-based payment calculations, as set out in the relevant accounting policies shown above. A number of the available-for-sale financial assets held by the Company are at an early stage of their development. The Company cannot yet carry out regular reliable fair value estimates of some of these investments. Future events or transactions involving the companies invested in may result in more accurate valuations of their fair values (either upwards or downwards) which may affect the Company's overall net asset value.

3 Losses on investments

4 Segmental analysis

Geographic information

The Company has investments in six principal geographical areas - USA, Israel, BVI, Estonia, Cyprus, and Russia.

Non-current financial assets

As at 31/12/2014

As at 31/12/2013

5 Administrative expenses

Administrative expenses include the following amounts:

6 Staff expenses

Wages and salaries shown above include salaries and bonuses relating to 2014. These costs are included in administrative expenses. As discussed in note 14, wages and salaries include US$300,000 of employee salaries that were settled by the issue of shares in lieu of cash payments. In addition to the above, there are employment expenses for share-based payments of US$166,282 (for the year ended 31 December 2013: $576,207).

The average number of staff employed (excluding Directors) by the Company during the year was 5 (2013: 5).

The Directors' fees (including bonuses where applicable) for 2014 were as follows:

The Directors' fees shown above are all classified as 'short term employment benefits' under International Accounting Standard 24. The Directors do not receive any pension contributions or other benefits.

Key management personnel of the Company are defined as those persons having authority and responsibility for the planning, directing and controlling the activities of the Company, directly or indirectly. Key management of the Company are therefore considered to be the Directors of the Company. There were no transactions with the key management, other than their Directors fees, bonuses and share options.

7 Net finance income

8 Income tax expense

The Company is incorporated in Jersey. No tax reconciliation note has been presented as the income tax rate for Jersey companies is 0%.

9 Loss per share

The calculation of basic loss per share is based upon the net loss for the year ended 31 December 2014 attributable to the ordinary shareholders of US$1,561,988 (2013: net loss of US$1,849,303) and the weighted average number of ordinary shares outstanding calculated as follows:

The weighted average number of ordinary shares outstanding before and after adjustment for the effects of all dilutive potential ordinary shares calculated as follows:

The diluted loss per share for both 2014 and 2013 is kept the same as the basic loss per share because the conversion of the share options decreases the basic loss per share and is therefore anti-dilutive.

10 Non-current financial assets

Reconciliation of fair value measurements of non-current financial assets:

Available-for-sale investments are carried at fair values. Where financial assets do not have a quoted market price in an active market and their fair values cannot be reliably measured they are measured at cost less any identified impairment losses at the end of reporting period, in accordance with IAS 39 para 46 (c) exemption.

Where there has been a relevant transaction during the year that gives an indication of the fair value of the unlisted shares, the shares are included at that fair value and the increase or decrease in fair value is recognised in the fair value reserve. The "price of recent investment" methodology is used mainly for investments in venture capital companies and includes cost of investment or valuation by reference to a subsequent financing round. Valuation increases above cost are only recognised if that round involved a new external investor and the company is meeting milestones set by investor.

(i) Equity investments as at 31 December 2014:

(ii) Convertible loan notes as at 31 December 2014:

11 Trade and other receivables

12 Cash and cash equivalents

The cash and cash equivalents as at 31 December 2014 include cash on hand and in banks, deposits, net of outstanding bank overdrafts. The effective interest rate at 31 December 2014 was 0.95%.

Cash and cash equivalents comprise the following:

The following table represents an analysis of cash and equivalents by rating agency designation based on Fitch rating or their equivalent:

13 Trade and other payables

14 Share capital

On 31 December 2014 the Company had an authorised share capital of unlimited shares of no par value and had issued share capital of:

On 29 April 2014, as a result of Alexander Selegenev's exercising his option, the Company allotted 33,334 new ordinary shares of no par value each in the Company to Alexander Selegenev at a price of US$1.00 per share, raising US$33,334.

On 20 June 2014, as a result of the Company's senior managers German Kaplun, Alexander Morgulchik and Artyom Inyutin's exercising their options, the Company allotted 1,125,000 ordinary shares, at the exercise price of US$1.40 per share. The share price on the date of exercise was US$1.975 per share.

On 22 July 2014, the Company allotted 1,432,431 new ordinary shares of no par value each in the Company to new investors at a price of US$1.85 per share, being a discount of 5.6% over the closing price of the Company's shares on 21 July 2014 and raising US$2.65 million.

In December 2013, German Kaplun, Alexander Morgulchik and Artyom Inyutin entered into agreements with the Company to receive all of their 2014 salaries, collectively amounting to US$300,000, in TMT shares on 31 December 2014 rather than monthly in cash. Accordingly, on 31 December 2014, the Company allotted 176,469 ordinary shares of no par value each in the Company at a price of US$1.70 per share (31 December 2013: the Company allotted 187,500 ordinary shares of no par value each in the Company at a price of US$1.60 per share amounting to US$300,000 ).

There have been no changes to the Company's share capital between the year-end date and the date of approval of these financial statements.

15 Share-based payments

On 27 April 2011, on the recommendation of the independent directors, the Company granted share options to subscribe for up to 100,000 ordinary shares to Mr. Alexander Selegenev, an executive director of the Company.

The terms and conditions of the options granted were as follows:

Options granted to Mr. Alexander Selegenev vested as follows:

* or a period of 30 days starting from the date on which certain circumstances preventing exercise during these periods have ended.

As at 31 December 2014 all options for 100,000 ordinary shares had either been exercised by Mr. Alexander Selegenev or lapsed.

On 24 October 2012, Board of Directors approved a share option plan (the "Plan") for directors, officers, employees of or consultants to the Company and/or any company directly or indirectly controlled by the Company.

Under the Plan, options for a total of 7,500,000 ordinary shares in the Company, representing approximately 30% of the then issued share capital (or 23% of the enlarged share capital at the time, assuming full exercise of the options), could be made available at an exercise price determined by the Board or its remuneration committee, which would not be less than the closing middle market price for the Company's share on AIM on the date of grant as published by or on behalf of the London Stock Exchange plc.

Options were to vest on a daily basis over a period of 3 years whilst the option holder remains eligible, and vested options could be exercised on each anniversary of the grant, but if not exercised within 1 year from the allowable date of exercise, would lapse.

The following options, without performance conditions, have been granted under the Plan on 24 October 2012:

The fair value of services received in return for share options granted is based on the fair value of share options and warrants granted, measured using the Black-Scholes formula, using the following assumptions:

Expected volatility is estimated from the Company's share price performance on AIM.

On 20 June 2014, the Company's senior managers German Kaplun, Alexander Morgulchik and Artyom Inyutin each exercised options over 375,000 (in total 1,125,000) ordinary shares, at the exercise price of US$1.40 per share. The share price on the date of exercise was US$1.975 per share.

No other options that vested in Year 1 under the Plan were exercised, and those options have now lapsed.

16 Reserves

17 Capital management

The capital structure of the Company consists of equity share capital, reserves, and retained losses.

The Board's policy is to maintain a strong capital base so as to maintain investor and market confidence and to enable the successful future development of the business.

The Company is not subject to externally imposed capital requirements.

No changes were made to the objectives, policies and process for managing capital during the year.

18 Financial risk management and financial instruments

The Company has identified the following risks arising from its activities and has established policies and procedures to manage these risks. The Company's principal financial assets are cash and cash equivalents, investments in equity shares, and convertible notes receivable.

Credit risk

As at 31 December 2014 the largest exposure to credit risk related to cash and cash equivalents, which was US$2,639,070. The exposure risk is reduced because the counterparties are banks with high credit ratings ("A" Liquidity banks) assigned by international credit rating agencies. The Directors intend to continue to spread the risk by holding the Company's cash reserves in more than one financial institution.

(i) Exposure to credit risk

The carrying amount of the following assets represents the maximum credit exposure. The maximum exposure to credit risk asat 31 December is as follows:

Market risk

The Company's financial assets areclassified as available-for-sale and are measured at fair value. The measurement of the Company's investments in equity shares and convertible notes is largely dependent on the underlying trading performance of the investee companies, but the valuation and other items in the financial statements can also be affected by the interest rate and fluctuations in the exchange rate.

Interest rate risk

Changes in interest rates impact primarily cash and cash equivalents by changing either their fair value (fixed rate deposits) or their future cash flows (variable rate deposits). Management does not have a formal policy of determining how much of the Company's exposure should be to fixed or variable rates.

At 31 December 2014 the Company had a cash deposit of US$1,000,000, earning a variable rate of interest. The Board of Directors monitors the interest rates available in the market to ensure that returns are maximized.

Foreign currency risk management

The Company is exposed to foreign currency risks on investments and salary and director remuneration payments that are denominated in a currency other than the functional currency of the Company. The currency giving rise to this risk is primarily GBP, EUR. The exposure to foreign currency risk as at 31 December 2014 was as follows:

The foreign exchange rates of the USD at 31 December were as follows:

This analysis assumes that all other variables, in particular interest rates, remain constant.

Liquidity risk management

The Company's approach to managing liquidity is to ensure that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company.

The Company has low liquidity risk due to maintaining adequate banking facilities, by continuously monitoring actual cash flows and by matching the maturity profiles of financial assets and current liabilities.

As at 31 December 2014, the cash and equivalents of the Company were US$2,639,070.

The following are the maturities of current liabilities as at 31 December 2014:

19 Related party transactions

Since May 2012, TMT's Moscow-based staff have been located in an office that belongs to a company ("Orgtekhnika") controlled by Mr. Alexander Morgulchik and Mr. German Kaplun, who collectively own 22.12% of the issued share capital of TMT and are thus considered related parties. There are currently 5 TMT staff involved working substantially full time on TMT's business. TMT started paying rent from 1 October 2012. Rent was being paid to Orgtekhnika at the rate of US$700 per sq meter per year of space utilised. The board believes this represented a discount from the prevailing market rate for similar office space in Moscow at the time. Together with other related expenses (support personnel, company car, security services, etc.), the total costs to TMT were US$14,384 per month (US$172,608 per year). Following the recent negative developments in the Russian economy and Moscow office rental market in particular, starting from 1 February 2015 these office costs have been reduced to US$7,000 per month.

In December 2012, Alexander Morgulchik, German Kaplun and Artyom Inyutin agreed to receive all of their 2013 salaries in TMT shares on 31 December 2014 rather than monthly in cash. The number of shares receivable in each case was fixed at a price of US$1.60 per share. Also in December 2013, Alexander Morgulchik, German Kaplun and Artyom Inyutin agreed to receive all of their 2014 salaries in TMT shares on 31 December 2014 rather than monthly in cash. The number of shares receivable in each case was fixed at a price of US$1.70 (2013: US$1.60) per share.

20 Subsequent events

In February 2015, TMT's portfolio company Drippler, a mobile tech discovery service, completed a new sizable equity financing round. The transaction represents an uplift of approximately US$97,000 (or 48%) in the fair value of TMT's investment in Drippler, compared to the amount announced as of 30 June 2014.

In April 2015, the Company invested US$300,000 in fragrance subscription service ScentBird.

21 Control

The Company is not controlled by any one party. Details of significant shareholders are shown in the Directors' Report.