Share Name Share Symbol Market Type Share ISIN Share Description
Bould Opportunities Plc LSE:BOU London Ordinary Share GB00B1TK2453 ORD 0.01P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  0.00 0.0% 0.023 0.00 0.00 0.00 0.00 0.00 0.00 00:00:00
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Nonequity Investment Instruments 0.1 -1.7 -0.3 - 3

Bould Opportunities PLC Full year results, Annual Report and Notice of AGM

26/06/2019 5:00pm

UK Regulatory (RNS & others)


Bould Opportunities (LSE:BOU)
Historical Stock Chart

1 Year : From Feb 2019 to Feb 2020

Click Here for more Bould Opportunities Charts.

TIDMBOU

RNS Number : 5507D

Bould Opportunities PLC

26 June 2019

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement via a Regulatory Information Service ("RIS"), this inside information is now considered to be in the public domain.

26th June 2019

Bould Opportunities Plc

(AIM: BOU, "Bould Opportunities", the "Company" or "the Group"),

Full year results, Posting of Annual Report and Notice of AGM

Bould Opportunities Plc, from April 2019 an AIM Rule 15 Cash Shell, and formerly in 2018 the British designer and manufacturer of smart LED lighting solutions, announces its audited results for the year ended 31 December 2018.

In addition, the Group's Annual Report and Accounts for the year ended 31 December 2018 (the "Annual Report") will be posted to shareholders on 28 June 2018.

A Notice of the Group's Annual General Meeting ("AGM") will also be posted to shareholders with the Annual Report, and both will be available to download on Bould Opportunities website via http://www.BouldOpportunities.com shortly.

The AGM will be held at the offices of Goodman Derrick LLP, 10 St Bride Street, London EC4A 4AD on Thursday 8 August 2019 at 11am.

Financial overview

The Group substantially reduced its operations in 2018, and wound down its remaining business in the first part of 2019, becoming an AIM Rule 15 Cash Shell in April 2019. The financial results for 2018 were for the LED lighting solutions business, and in the 2018 financial statements these results have been allocated between the results of operations that were discontinued in 2018 and the remaining business that continued into the first part of 2019.

   --     For the continuing business; 
   -    Revenues for full year 2018 down 75% to GBP0.07m (2017: GBP0.29m) 
   -    Gross profit fell 45% to GBP0.04m (2017: GBP0.08m) 
   -    Exceptional administrative expenses GBP0.50m (2017: GBP0.75m) 
   -    Administrative expenses (excluding exceptional item) up 31% to GBP1.33m (2017: GBP1.04m) 
   -    Loss from Continuing Operations of GBP1.61m (2017: loss GBP1.54m) 
   --     Loss from Discontinued Operations of GBP0.44m (2017: loss GBP0.37m) 
   --     Loss and total comprehensive income for year GBP2.06m  (2017: loss GBP1.91m) 
   --     Loss per share of 0.3p (2017: loss per share 0.9p) 
   --     At 31 December 2018, net cash of GBP0.004m (2017: net debt GBP0.8m) 

Post year end

-- Announced its intention that PhotonStar Technology Limited would be wound down in an orderly way and would cease trading.

   --     Became an AIM Rule 15 Cash Shell. 

-- Raised gross proceeds of GBP1.15m via four issues of new shares, primarily to fund the Group whilst it considers its strategic direction and future investment opportunities.

Allan Syms, Chairman of Bould Opportunities, said:

'The Group is now in a good position to be able to consider new investment opportunities and is not hampered with any liability for its past loss-making operations. Sufficient working capital has been raised already in 2019 to fund current expenditure. The Directors will consider future funding when there is a clearer view of their proposals for the Group's best way forward from its current position as an AIM Rule 15 Cash Shell. The Group is seeking new investment opportunities in a number of business areas including the health sector.'

For further information:

 
 Bould Opportunities Plc (www.bouldopportunities.com) 
  Martin Lampshire - non-executive director              +44 (0)20 3198 2554 
 
 Allenby Capital Limited (nominated adviser) 
  John Depasquale / Nick Naylor                          +44 (0)20 3328 5656 
 
 
 Peterhouse Capital Limited (sole broker) 
  Lucy Williams / Duncan Vasey                           +44 (0)20 7469 0930 
 

Chairman's Statement

As your new Chairman, I am pleased to report to you on the group's activities in 2018 and on the many changes to the Group in that year, and in the year to date in 2019.

Overview

In 2018 the Group underwent fundamental changes.

At the start of 2018, the group had three trading segments as well as the coordinating activities of the AIM quoted holding company. By the end of 2018, two of the three trading segments had been disposed of and the third segment had substantially reduced its activities.

In April 2019, a General Meeting confirmed the closure of the group's remaining trading segment, and so the group became an AIM Rule 15 cash shell ("Cash Shell") that is seeking new investment opportunities in a number of business areas including the health sector.

I will try and summarise in my own words some of the main reasons underlying this relatively sudden change in direction for the group.

For several years, as previously reported, sales had been falling in the group's main market for more traditional LED lighting fixtures. Whilst the overall market for LED lighting was expanding, the fall in the group's sales had been driven largely by increased competition from cheaper imported LED lighting products.

As a result, in 2017, the group had announced an ambitious change in its strategy - from being a group focused mainly on the sales of LED lighting fixtures to a group centered on retrofitting advanced LED lighting control services to buildings through IoT (the Internet of Things).

However, in 2018 it was the opinion of the Directors at that time that the Group had insufficient funds to fund both its continuing trading losses and to support its investment efforts to finalise the development of the new technology required for the IoT based new lighting control processes (its Halcyon product development platform).

The Group was unable to raise sufficient ongoing working capital and this triggered a series of disposals in 2018 that have resulted in the group becoming an AIM Rule 15 cash shell company by April 2019.

Now, in mid-2019, we are an exciting new group, with a new board of directors, with a new name, and with an initial cash fund that is seeking potential new rewarding investment opportunities. Funds were raised as detailed below.

Business review

As can be seen from the Directors and Advisors section, the current Directors were not on the Board during the financial year to 31 December 2018 and hence in order to fulfill their responsibilities for the financial statements the Directors have had to carry out more extensive enquiries than normal with the Group's advisers who were present at that time, and received necessary written representations where appropriate from them on key issues. I will now explain in more detail the main activities undertaken by the group in the financial year to 31 December 2018.

Before doing so, I would explain that in our 2018 consolidated Statement of Comprehensive Income, prepared according to IFRS accounting standards, we are required to show separately the results of the group's discontinued operations from its continuing operations at the year-end.

The discontinued operations at the end of 2018 were Camtronics Vale Limited, Photonstar LED Limited and Architectural Lighting & Controls Limited. And, the group's two continuing operations were Photonstar Technology Limited and the activities of the group's ultimate holding company.

Discontinued operations:

Camtronics Vale Limited ('Camtronics Vale') - Contract manufacturing

At the end of January 2018, in order to raise cash for the group and to reduce borrowings, the group decided to sell its contract manufacturing business, Camtronics Vale Limited, to its management for a cash consideration of GBP150,000, including deferred consideration, and a consideration of GBP521,000

from the novation of intergroup indebtedness. In the month before disposal Camtronics had sales of GBP133,000 and a trading loss of GBP15,000 (2017: 12 months sales of GBP1,679,000 and trading loss

(GBP86,000), and the group profit on disposal was GBP125,000. Whilst most of the deferred consideration has now been received, the final outcome of the overall group profit on disposal was somewhat less than the previously announced profit of GBP327,000.

Photonstar LED Limited - LED lighting fixtures business

During 2018, the group continued to struggle with its efforts to boost the sales of its traditional LED lighting products through its subsidiary Photonstar LED Limited. And, it was not possible to reduce overheads sufficiently to achieve profitability. This subsidiary already had net liabilities, and losses were increasing. As a result, a decision was taken to place this subsidiary into Administration at the end of October 2018, and a Liquidator was appointed to the company on 18 November 2018. The sales of this subsidiary for the 10 months to the end of October were GBP1,682,000 and its trading loss was GBP318,000 (2017: 12 months sales GBP2,575,000 and its trading loss GBP284,000). The appointment of the Liquidator stemmed any further losses, but crystallised net exceptional disposal impairments to the group of GBP128,000.

Architectural Lighting & Controls Limited ('ALC') - dormant subsidiary

ALC is a dormant subsidiary of Photonstar LED Limited, ALC's business having been transferred to its parent company soon after acquisition several years ago. The Liquidator of Photonstar LED Limited now controls ALC, and as a result the group's goodwill of GBP106,000 in respect of ALC has been written off.

Continuing operations:

Photonstar Technology Limited - Halcyon IoT and LED light engines

The development of the new Halcyon IoT platform being undertaken by Photonstar Technology Limited was progressing well in the first three quarters of 2018. New trial software had been released to multiple customer sites. However, development work had to be reduced in the fourth quarter of 2018 as a result of the group's diminishing cash resources. At that time, staff numbers were reduced, and a few months later in January 2019 the group announced that there would be an orderly wind down of the subsidiary's activities. There was only a small volume of Halcyon sales in 2018, GBP74,000 (2017: GBP293,000), and the trading losses before tax were GBP909,000 (2017: loss GBP822,000). In 2018, there was a prior year R&D tax credit of GBP118,000 (2017: GBP104,000). As a result of the pending closure, at the end of 2018, closure costs of GBP67,000 (2017: GBPNil) were accrued, and all the assets of this subsidiary were fully impaired causing a 2018 impairment charge of GBP501,000 (2017: GBP748,000).

Bould Opportunities PLC (before 15 April 2019 called Photonstar LED Group Limited) - holding company for the group

This is the group's ultimate holding company. The financial commitments of the holding company and the extent of the intergroup re-charges were both reduced during 2018, eventually to a minimum level sufficient only to support the group's ongoing AIM listing. The net administration costs for the holding company in 2018 were GBP323,000 (2017: GBP35,000).

Financial overview

In summary, from a financial viewpoint, from 1 January 2018, through 2018, and to April 2019 the Group has transformed successfully from a trading Group that has been consuming all of its cash resources to a Cash Shell still quoted on AIM and considering new investment opportunities.

Much of the Group's business was either sold or closed down in 2018. And, full provision has been made in these 2018 financial statements for closing the remaining trading operations in the first quarter of 2019. So, the Group is now moving forward with confidence, and unencumbered from any ongoing liability for its past loss making, and cash consuming, activities.

As explained earlier in this report, under IFRS accounting, the results of the group are separated between continuing and discontinued operations, and prior year consolidated figures have been restated where appropriate.

For the continuing operations, group sales were GBP74,000 (2017: GBP293,000). The consolidated operating loss on continuing operations before exceptional items and tax in 2018 was GBP1,232,000 (2017: loss GBP896,000). There were exceptional impairment charges of GBP501,000 (2017: 748,000), and the consolidated operating loss for continuing operations after these exceptional items was GBP1,733,000 (2017: loss GBP1,644,000). In 2018 there was a research and development tax credit of GBP118,000 (2017: GBP104,000). The overall consolidated loss on continuing operations after tax was GBP1,615,000 (2017: loss GBP1,540,000).

The loss after tax on discontinued operations was GBP442,000 (2017: loss GBP370,000). Further details about each discontinued operation is set out earlier in my report and in Note 5 to the financial statements.

The group's total comprehensive loss for 2018 was GBP2,057,000 (2017: loss GBP1,910,000).

During 2018 focus was on completing the Halcyon product development and its roll out to customer test sites. Capitalised investment in product development in 2018 was GBP158,000 (2017: GBP440,000). The purchase of plant and equipment in 2018 amounted to GBP18,000 (2017: GBP27,000).

The net proceeds from the issue of shares in 2018 was GBP1,081,000 (2017: GBP2,000).

All of the group's borrowings were in operations that were subsequently discontinued in 2018 , and so no longer formed part of the Consolidated Balance Sheet at the 2018 year-end.

Post year end

In January 2019 the group announced its intention that Photonstar Technology Limited would cease trading and its activities would be wound down in an orderly way.

In March 2019 the name of the group's holding company was changed to Bould Opportunities PLC.

In April 2019 a General Meeting approved the closure of Photonstar Technology Limited. The group then became an AIM Rule 15 quoted cash shell and as such is required to make an acquisition or acquisitions which constitutes a reverse takeover under AIM Rule 14 (including seeking re-admission as an investing company (as defined under the AIM Rules)) on or before the date falling six months from completion of that General Meeting or be re-admitted to trading on AIM as an investing company under the AIM Rules (which requires the raising of at least GBP6 million of new equity funding) failing which, the Company's Ordinary Shares would be suspended from trading on AIM pursuant to AIM Rule 40. Admission to trading on AIM of the Company's shares would be cancelled six months from the date of suspension should the reason for the suspension not have been rectified.

All the directors of the Photonstar group have now resigned, and a new board of directors has been appointed. I would like to thank the departing directors and staff for all their significant efforts in their attempt to make Photonstar a success. It is disappointing that this was not to be. In June 2019 the sale of Photonstar Technology Limited was completed in accordance with the resolution passed at May's General Meeting.

Your new directors have confidence in the future of the Group. There have now been four issues of shares to date in 2019 raising GBP1,153,000 before expenses. The Group has announced that it is considering raising further funds in due course in order to fund future investment.

The Group is now in a good position to be able to consider new investment opportunities and is not hampered with any liability for its past loss-making operations. Sufficient working capital has been raised already in 2019 to fund current expenditure. The Directors will consider future funding when there is clearer view of their proposals for the Group's best way forward from its current position as an AIM Rule 15 Cash Shell.

Allan Syms

Chairman

26 June 2019

Strategic Report

The directors present their strategic report for the year ended 31 December 2018.

Business review

Principal risks and uncertainties

In the previous year's Strategic Report, a number of potential risks and uncertainties were highlighted that could impact on the Group's performance. The outcome of these risks and uncertainties in 2018 and 2019 year to date may be summarised:

-- Going Concern - the Group had historically been loss making and similarly made a loss after tax of GBP1.91m in 2017. Whilst at that time the Board believed that the Group had sufficient resources available to continue operating for at least the next 12 months, this was predicated on the Group achieving an anticipated growth in the levels of sales and gross margin, which were themselves subject to operational and market uncertainty. This was further explained in Note 2.2 to the 2017 accounts. The outcome in 2018 was that there was increasing pressure on the Group's cash resources. Trading losses continued through 2018, and together with further expenditure on the Halcyon product development, there was a critical cash shortfall in the fourth quarter of 2018. As a result, the Group's subsidiary selling the LED light fixtures was placed in to liquidation in November 2018 and the number of staff employed on product development was significantly reduced. The disposals in 2018 resulted in all Group borrowings being eliminated. After the 2018 year-end, in January 2019, the group announced its intention to wind down its development operations. The closure of this remaining trade activity was confirmed at a General Meeting in April 2019, and the Group became a cash shell on AIM. In 2019 the Group has raised GBP1,153,000 cash before expenses from share issues - so, the Group has sufficient cash resources for its current minimal financial commitment to support its AIM listing. Potential new investment opportunities are being reviewed, and further fund raising is expected when investment plans are in place.

-- Research & Development and Product Development activities - at the time of the 2017 Strategic Report, the directors were confident that the Group had the right people with the right skills and drive in order to execute its R&D and Product Development plan. There was no guarantee that these efforts would be successful, or that any such development work would be successfully translated into a commercial product or sales for the Group. In 2018, the next generation of new Halcyon software was successfully rolled out to customer sites. However, as explained above, development operations were curtailed in the fourth quarter of 2018 due to the Group's limited cash resources, and then closed down from January 2019.

-- Market conditions and competition - In their 2017 report the directors explained that the Group operated in markets where there are many competing products and competing companies, many of whom had significantly greater resources than the Group. Whilst the Group endeavoured to differentiate its products from competitors on the basis of quality, performance and reliability, the Group found that our customers prefer to sacrifice such attributes in return for a lower price. In 2018 sales of the existing range of LED lighting products continued to fall, and there were fewer than expected sales for its new Halcyon products.

-- In their 2017 Strategic Report the directors also listed other financial risks, including credit risk, interest rate risk and foreign exchange risk. None of these risks had a material impact on 2018 results and no such risk existed at the end of 2018.

After the 2018 year-end, all of the Group's business have ceased, and the directors have announced their intention to seek new investment opportunities for the Group, and any new investment is expected to require further funding from shareholders. The outcome of this plan cannot be predicted at the present time.

Key performance indicators (KPIs)

During 2018 the Group's directors used various key performance indicators to help understand the development, performance and position of the business. Ordinarily this was presented in the form of monthly management accounts and other management information (although other information was presented on an ad hoc basis as and when requested), and included, amongst others, the following indicators which the directors considered were key. The 2018 KPIs are for the whole of 2018 for the Halcyon & Light Engines business, and until operations were discontinued for contract Manufacturing (to January 2018) and the LED Light Fixtures business (to November 2018). The 2017 figures are all for the whole of each period.

Combined continuing and discontinued operations:

 
 In GBP'000                         12 months       6 months     6 months       12 months        6 months     6 months 
                               to 31 December          to 31        to 30           to 31           to 31        to 30 
                                         2018       December    June 2018        December        December    June 2017 
                                                        2018                         2017            2017 
-------------------------  ------------------  -------------  -----------  --------------  --------------  ----------- 
 Sales: 
  LED light 
   fixtures -discontinued               1,682            528        1,154           2,575           1,214        1,361 
  Halcyon & 
   light engines 
   - continuing                            74 
                                                          25           49             293             184          109 
 Contract Manufacturing 
  - discontinued                          127              -          127           1,679             890          789 
 
 Gross profit 
  %                                     37.0%          42.9%        34.5%           31.9%           31.4%        32.4% 
 
 Net operating 
  expenses excluding 
  exceptional 
  costs                                 2,238            976        1,262           2,642           1,333        1,309 
 Adjusted EBITDA 
  loss (defined 
  in Note 5)                            (591)          (171)        (420)           (483)            (87)        (396) 
 
 In GBP'000                             As at                       As at           As at                        As at 
                                  31 December                     30 June     31 December                      30 June 
                                         2018                        2018            2017                         2017 
-------------------------  ------------------  -------------  -----------  --------------  --------------  ----------- 
 
 Net cash/(debt)                            4                       (308)           (789)                        (810) 
-------------------------  ------------------  -------------  -----------  --------------  --------------  ----------- 
 

All of the actual performances of the above KPI's were compared monthly to those formulated in the Group's budget or latest forecast.

The major programme of investment in research and development continued to impact the net cash resources of the Group.

The main non-financial KPI was monitoring the progress of the new Halcyon trials.

Financial review

In 2018 there were significant changes to the Group's financial statements compared to the previous year as a result of selling the Contract Manufacturing business in January 2018 and the liquidation of the LED Light Fixtures business in November 2018. Comparative figures have been re-analysed where appropriate to do so.

Total Group sales, including in 2018 both continuing and discontinued operations, decreased to GBP1.88m (2017: GBP4.55m), the reduction reflecting the sale earlier in the year of the Group's Contract Manufacturing operations and the ongoing decline in sales, then liquidation in the fourth quarter, of the LED Light Fixtures business. Sales of the ongoing Halcyon & Light Engines business were disappointing at GBP74,000 (2017: GBP293,000).

The Board's annual review of tangible and intangible assets has resulted in an impairment charge in 2018 of GBP0.50m (2017: GBP0.84m).

In the Consolidated Statement of Comprehensive Income, the loss after tax of the continuing activities was GBP1.62m (2017: loss of GBP1.54m) - the continuing activities being the Halcyon & Light Engines business and the activities of the holding company. The loss of the discontinued operations referred to in the previous paragraph was GBP0.44m (2017: loss of GBP0.37m).

Basic and the diluted loss per share were 0.3p (2017: 0.9p).

During 2018, the Group made capital expenditure of GBP0.18m (2017: GBP0.47m) mainly on the development of the new Halcyon product.

The disposal of the discontinued businesses referred to above substantially reduced the 2018 year-end Balance Sheet amounts of the consolidated assets and liabilities.

In January 2019 the Group announced the planned closure of its remaining Halcyon & Light Engines business. This closure was confirmed at a General Meeting in April 2019, resulting in the Group becoming a cash shell on AIM.

After the 2018 year-end the Group has raised significant additional funds by share issues as explained in Note 31 on Subsequent Events.

The Group is currently reviewing potential new investment opportunities that may require future funding from shareholders. It is too early to predict the outcome of this plan.

This report was approved by the board on 26 June 2019 and was signed on its behalf by

Martin Lampshire

Non-Executive Director

Consolidated Statement of Comprehensive Income

for the year ended 31 December 2018

 
                                             Notes                          2018          2017 
                                                                         GBP'000       GBP'000 
                                                                                     Restated* 
-----------------------------------------  ---------  --------------------------  ------------ 
 Continuing Operations 
 Revenue                                       5                              74           293 
 Cost of sales                                                              (29)         (211) 
-----------------------------------------  ---------  --------------------------  ------------ 
 Gross profit                                                                 45            82 
 
 Administrative expenses (excluding 
  exceptional item)                            5                         (1,331)       (1,045) 
 Exceptional item (administrative 
  expenses)                                    6b                          (501)         (748) 
-----------------------------------------  ---------  --------------------------  ------------ 
 Total administrative expenses                                           (1,832)       (1,793) 
 Other income                                  6c                             54            67 
-----------------------------------------  ---------  --------------------------  ------------ 
 Operating loss                                                          (1,733)       (1,644) 
 
 Finance income and costs                      20                              -             - 
 Loss before income tax                                                  (1,733)       (1,644) 
 
 Income tax income                             22       118                                104 
-----------------------------------------  ---------  --------------------------  ------------ 
 Loss from continuing operations                                         (1,615)       (1,540) 
 
 Loss from discontinued operations           5                   (442)                   (370) 
-----------------------------------------  ---------  --------------------------  ------------ 
 Loss and total comprehensive income 
  for the year 
 attributable to the equity shareholders 
  of the parent                                            (2,057)                     (1,910) 
-----------------------------------------  -------------------------------------  -------------- 
 
 Earnings per ordinary share (pence) 
  from continuing and discontinued 
  operations attributable to the 
  equity shareholders: 
 Continued operations basic and 
  diluted                                      24                         (0.2p)        (0.7p) 
 Discontinued operations basic and 
  diluted                                      24                         (0.1p)        (0.2p) 
-----------------------------------------  ---------  --------------------------  ------------ 
 Earnings per ordinary share (pence) 
  attributable to 
 the equity shareholders of the 
  parent                                       24                         (0.3p)        (0.9p) 
 
 
 

The Company has elected to take the exemption under section 408 of the Companies Act 2006 to not present the Parent Company's statement of comprehensive income.

The loss for the Parent Company for the year was GBP1,702,000 (2017 loss: GBP4,587,000).

*The comparative figures have been restated to show the results of continuing and discontinued operations (Note 5).

Registered number: 06133765 (England and Wales)

Consolidated Statement of Financial Position

As at 31 December 2018

 
                                        Notes      2018      2017 
                                                GBP'000   GBP'000 
--------------------------------------  -----  --------  -------- 
Non-current assets 
Property, plant and equipment               8         -       335 
Intangible assets                           9         -       917 
--------------------------------------  -----  --------  -------- 
                                                      -     1,252 
Current assets 
Inventories                                10         -       761 
Trade and other receivables                11        92       948 
Current tax assets                                    -        80 
Cash and cash equivalents                  12         4        44 
--------------------------------------  -----  --------  -------- 
                                                     96     1,833 
--------------------------------------  -----  --------  -------- 
Total assets                                         96     3,085 
--------------------------------------  -----  --------  -------- 
 
Equity 
Capital and reserves attributable 
 to equity holders of the company 
Ordinary shares                            13     2,355     2,252 
Share premium                              13     8,806     7,828 
Share capital reduction reserve            13    10,081    10,081 
Share option reserve                                  -       680 
Reverse acquisition reserve                30         -   (8,843) 
Accumulated losses                             (21,477)  (11,257) 
--------------------------------------  -----  --------  -------- 
Total equity                                      (235)       741 
--------------------------------------  -----  --------  -------- 
 
Liabilities 
Current liabilities 
Trade and other payables and deferred 
 income                                    15       331     1,486 
Borrowings                                 15         -       833 
Provisions                                 17         -        10 
                                                    331     2,329 
--------------------------------------  -----  --------  -------- 
Non-current liabilities 
Deferred tax liabilities                   16         -        15 
Total liabilities                                   331     2,344 
--------------------------------------  -----  --------  -------- 
 
Total equity and liabilities                         96     3,085 
--------------------------------------  -----  --------  -------- 
 

The financial statements were approved and authorised for issue by the Board on 26 June 2019 and were signed on its behalf by:

Martin Lampshire

Non-Executive Director

Registered number: 06133765 (England and Wales)

Company Statement of Financial Position

As at 31 December 2018

 
                                    Notes      2018      2017 
                                            GBP'000   GBP'000 
----------------------------------  -----  --------  -------- 
 
Non-current assets 
Investments                             7         -         - 
                                                  -         - 
Current assets 
Trade and other receivables            11        79     1,425 
Cash and cash equivalents              12         2         3 
----------------------------------  -----  --------  -------- 
                                                 81     1,428 
----------------------------------  -----  --------  -------- 
Total assets                                     81     1,428 
----------------------------------  -----  --------  -------- 
 
Equity 
Capital and reserves attributable 
 to equity holders of the company 
Ordinary shares                        13     2,355     2,252 
Share premium                                 8,806     7,828 
Share capital reduction reserve        30    10,081    10,081 
Share option reserve                              -       634 
Accumulated losses                         (21,278)  (20,210) 
----------------------------------  -----  --------  -------- 
Total equity                                   (36)       585 
----------------------------------  -----  --------  -------- 
 
Liabilities 
Current liabilities 
Trade and other payables               15       117       843 
Total liabilities                               117       843 
----------------------------------  -----  --------  -------- 
Total equity and liabilities                     81     1,428 
----------------------------------  -----  --------  -------- 
 

The financial statements were approved and authorised for issue by the board on 26 June 2019 and were signed on its behalf by:

Martin Lampshire

Non-Executive Director

Consolidated Statement of Cash Flows for the year ended 31 December 2018

 
 
                                                  Notes       2018      2017 
                                                           GBP'000   GBP'000 
---------------------------------------------  --------  ---------  -------- 
 Cash flows from operating activities 
 Loss before tax from: 
 Continuing operations                                     (1,733)   (1,732) 
 Discontinued operations                                     (442)     (347) 
 Adjustments for: 
 Exceptional item - impairment                   6b,32         284       836 
 Goodwill written off on disposals                             119         - 
 Depreciation                                      8            29        86 
 Amortisation                                      9           595       582 
 Share option charge                                             -        39 
 Movement in provisions                           17          (10)      (34) 
 Grant income                                      6             -      (60) 
 Profit on sale of Property, Plant 
  & Equipment                                                    -      (49) 
 Change in operating assets and liabilities 
 Including discontinued operations: 
 Decrease in inventories                          10           761        13 
 Decrease in trade & other receivables            11           856        91 
 (Decrease)/increase in trade & other 
  payables                                        15       (1,155)       137 
---------------------------------------------  --------  ---------  -------- 
 Cash used in operations                                     (696)     (438) 
 Tax received                                                  183       248 
---------------------------------------------  --------  ---------  -------- 
 Net cash used in operating activities                       (513)     (190) 
---------------------------------------------  --------  ---------  -------- 
 
   Cash flows from investing activities 
 Proceeds on disposal of Property, 
  Plant & Equipment                                              -        49 
 Purchase of property, plant and equipment         8             -      (27) 
 Purchase of intangible assets                     9         (176)     (440) 
 Decrease in fixed assets on disposal                        (401)         - 
---------------------------------------------  --------  ---------  -------- 
 Net cash used in investing activities                         225     (418) 
---------------------------------------------  --------  ---------  -------- 
 
   Cash flows from financing activities 
 Proceeds from the issue of ordinary 
  shares (net of issue costs)                     13         1,081       425 
 Change in borrowings                             15         (833)         2 
---------------------------------------------  --------  ---------  -------- 
 Net cash generated from financing 
  activities                                                   248       427 
---------------------------------------------  --------  ---------  -------- 
 
   Net decrease in cash and cash equivalents                  (40)     (181) 
 Cash and cash equivalents at the start 
  of the year                                     12            44       225 
---------------------------------------------  --------  ---------  -------- 
 Cash and cash equivalents at the end 
  of the year                                     12             4        44 
---------------------------------------------  --------  ---------  -------- 
 

Company Statement of Cash Flows for the year ended 31 December 2018

 
                                                 Notes       2018      2017 
                                                          GBP'000   GBP'000 
---------------------------------------------  --------  --------  -------- 
 Cash flows from operating activities 
 
   Loss before tax                                        (1,702)   (4,587) 
 Provision for Impairment to investment 
  in subsidiary companies and intercompany 
  balances                                       7,11         858     4,505 
 Share option charge                                            -        16 
 Change in trade and other receivables            11         (72)         2 
 Change in trade and other payables               15           18        27 
---------------------------------------------  --------  --------  -------- 
 Net cash used in operating activities                      (898)      (37) 
---------------------------------------------  --------  --------  -------- 
 Cash flows from investing activities 
 Change in intra group funding                  7,11,15     (184)     (389) 
---------------------------------------------  --------  --------  -------- 
 Net cash used in investing activities                      (184)     (389) 
---------------------------------------------  --------  --------  -------- 
 Cash flows from financing activities 
 Proceeds from the issue of ordinary 
  shares (net of issue costs)                     13         1130       425 
 Net cash generated from financing 
  activities                                                 1130       425 
---------------------------------------------  --------  --------  -------- 
 Net (decrease) in cash and cash equivalents                  (1)       (1) 
 Cash and cash equivalents at the start 
  of the year                                     12            3         4 
---------------------------------------------  --------  --------  -------- 
 Cash and cash equivalents at the end 
  of the year                                     12            2         3 
---------------------------------------------  --------  --------  -------- 
 

Consolidated Statement of Changes in Equity

for the year ended 31 December 2018

 
                                                                  Share 
                                                                capital      Share        Reverse 
                                 Ordinary share      Share    reduction     option    acquisition   Retained 
                                        capital    premium      reserve    reserve        reserve     losses     Total 
                                        GBP'000    GBP'000      GBP'000    GBP'000        GBP'000    GBP'000   GBP'000 
-----------------------  ----------------------  ---------  -----------  ---------  -------------  ---------  -------- 
 
   Balance at 1 January 
   2017                                   1,879      7,776       10,081        641        (8,843)    (9,347)     2,187 
-----------------------  ----------------------  ---------  -----------  ---------  -------------  ---------  -------- 
 
   Contributions 
   by and distributions 
   to owners 
 Issue of new shares 
  (net of issue 
  costs)                                    373         52            -          -              -          -       425 
 
 Share option charge                          -          -            -         39              -          -        39 
                         ----------------------  ---------  -----------  ---------  -------------  ---------  -------- 
                                            373         52            -         39              -          -       464 
                         ----------------------  ---------  -----------  ---------  -------------  ---------  -------- 
 
 Loss and total 
  comprehensive 
  income for the 
  year                                        -          -            -          -              -    (1,910)   (1,910) 
 
 Balance at 31 
  December 2017                           2,252      7,828       10,081        680        (8,843)   (11,257)       741 
-----------------------  ----------------------  ---------  -----------  ---------  -------------  ---------  -------- 
 
 Contributions 
  by and distributions 
  to owners 
 Issue of new shares 
  (net of issue 
  costs)                                    103        978            -          -              -          -     1,081 
 
 Reverse acquisition 
  reserve transfer                            -          -            -          -          8,843    (8,843)         - 
 
 Share option reserve 
  transfer                                    -          -            -      (680)              -        680         - 
                         ----------------------  ---------  -----------  ---------  -------------  ---------  -------- 
                                            103        978            -      (680)          8,843        680     1,081 
                         ----------------------  ---------  -----------  ---------  -------------  ---------  -------- 
 
 Loss and total 
  comprehensive 
  income for the 
  year                                        -          -            -          -              -    (2,057)   (2,057) 
 
 Balance at 31 
  December 2018                           2,355      8,806       10,081          -              -   (21,477)     (235) 
-----------------------  ----------------------  ---------  -----------  ---------  -------------  ---------  -------- 
 

Company Statement of Changes in Equity

for the year ended 31 December 2018

 
                                                            Share 
                                 Ordinary                 capital      Share 
                                    share      Share    reduction     option   Retained 
                                  capital    premium      reserve    reserve     losses     Total 
                                  GBP'000    GBP'000      GBP'000    GBP'000    GBP'000   GBP'000 
------------------------------  ---------  ---------  -----------  ---------  ---------  -------- 
 
 Balance at 1 January 
  2017                              1,879      7,776       10,081        618   (15,623)     4,731 
------------------------------  ---------  ---------  -----------  ---------  ---------  -------- 
 
   Contributions by and 
   distributions to owners 
 
   Issue of new shares 
   (net of issue costs)               373         52            -          -          -       425 
 Share option charge                    -          -            -         16          -        16 
                                ---------  ---------  -----------  ---------  ---------  -------- 
                                      373         52            -         16          -       441 
                                ---------  ---------  -----------  ---------  ---------  -------- 
 Loss and total comprehensive 
  income for the year                   -          -            -          -    (4,587)   (4,587) 
 Balance at 31 December 
  2017                              2,252      7,828       10,081        634   (20,210)       585 
------------------------------  ---------  ---------  -----------  ---------  ---------  -------- 
 
   Contributions by and 
   distributions to owners 
 Issue of new shares 
  (net of issue costs)                103        978            -          -          -     1,081 
 Share option reserve 
  transfer                              -          -            -      (634)        634         - 
                                ---------  ---------  -----------  ---------  ---------  -------- 
                                      103        978            -      (634)        634     1,081 
                                ---------  ---------  -----------  ---------  ---------  -------- 
 Loss and total comprehensive 
  income for the year                   -          -            -          -    (1,702)   (1,702) 
------------------------------  ---------  ---------  -----------  ---------  ---------  -------- 
 Balance at 31 December 
  2018                              2,355      8,806       10,081          -   (21,278)      (36) 
------------------------------  ---------  ---------  -----------  ---------  ---------  -------- 
 

Notes to the financial statements for the year ended 31 December 2018

   1       General information 

Until November 2018 the principal activity of the Group was the design, development, manufacture and sale of LED light fixtures and light engines. From that date the business selling LED light fixtures was placed into liquidation and the Group's remaining business was the sale and development of light engines. The contract manufacturing business had been previously sold in January 2018. After the year end in January 2019, the Group announced its intention to close down its remaining business activity. This closure was confirmed at a General Meeting in April 2019 and the Group became an AIM Rule 15 cash shell.

The Company is a public limited liability company incorporated and domiciled in England and Wales and quoted on the Alternative Investment Market ('AIM'). In April 2019 the Company changed its name from Photonstar LED Group PLC to Bould Opportunities PLC.

The directors consider there to be no ultimate controlling shareholder of the Company.

The address of the registered office is New Liverpool House, 15 Eldon Street, London, EC2M 7LD and the registered number of the Company is 06133765.

   2       Summary of significant accounting policies 

The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

   2.1     Basis of preparation 

The financial statements of Bould Opportunities PLC have been prepared in accordance with the requirements of the AIM Rules and in accordance with International Financial Reporting Standards as adopted by the European Union, IFRIC interpretations and the Companies Act 2006 applicable to companies reporting under IFRS and on a historical cost basis.

The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Group and Company's accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed in Note 4.

   (a)      New and amended standards adopted 

The accounting policies set out in the financial statements for the year ended 31 December 2018 have been applied consistently throughout the Group during the period, except for the adoption of the new pronouncements IFRS 9 "Financial Instruments" and IFRS 15 "Revenue from contracts with customers".

IFRS 9 "Financial Instruments" is effective for accounting periods beginning on or after 1 January 2018, and was adopted by the Group for the accounting period beginning 1 January 2018. The new standard replaces IAS 39 "Financial Instruments: Recognition & Measurement" and the changes introduced by the new standard can be grouped into the following three categories Classification & Measurement, Impairment and Hedging. The impact of the new standard in the Group was the following:

-- Classification and measurement: IFRS 9 contains three principal classification categories for financial assets which are amortised cost, fair value through other comprehensive income ("FVOCI") and fair value through profit or loss ("FVTPL"). The standard eliminates the existing IAS 39 categories of held-to-maturity, loans and receivables and available-for-sale financial assets. There were no changes to net assets from changes in the measurement basis of financial assets.

-- Impairment: IFRS 9 introduces an expected credit loss model which requires expected credit losses and changes to expected credit losses at each reporting date to reflect changes in credit risk since initial recognition. Financial assets measured at amortised cost or FVOCI are subject to the impairment provisions of IFRS 9. The adoption of this standard has not resulted in any material changes in the level of provision for financial assets.

-- Hedging: IFRS 9 introduces new hedge accounting requirements. IFRS 9 aligns hedge accounting relationships with the Group's risk management objectives and strategy. The Group does not apply hedge accounting, therefore there were no changes arising from the new standard.

IFRS15 is effective for accounting periods beginning on or after 1 January 2018, and was adopted by the Group for the accounting period beginning 1 January 2018. The standard requires entities to apportion revenue earned from contracts to individual performance obligations based on a five-step model. The adoption of this standard has not resulted in any material impact on reported profits.

(b) Standards, amendments and interpretations to existing standards that are not yet effective and have not been early adopted.

The Group and Company has not adopted any standards or interpretations in advance of the required implementation dates and believes that its effect will not be material to the Group. It is not expected that the adoption of any other standards or interpretations which have been issued by the International Accounting Standards Board but have not been adopted will have a material impact on the 2019 financial statements.

The Group has considered the impact of new standards taking effect on or after 1 January 2019 including the impact of IFRS 16 Leases. The adoption of this new standard is not expected to have a material impact on the financial statements.

   2.2     Going concern 

The Directors have adopted the going concern basis in preparing the financial statements for the year to 31 December 2018. In reaching this conclusion, the Directors have considered for both the Company and the Group, current trading and the current and projected funding position for the period of just over 12 months from the date of approval of the financial statements through to 30 Jun 2020.

Current funding

The Group's cash balance as at 31 December 2018 was GBP4,000 and there were no borrowing facilities at that date. Soon after the year-end in January 2019 the Group announced the orderly closure of its remaining business. Subsequently, the Group's only activities are that of a holding company supporting its AIM listing as a Cash Shell and seeking new investment opportunities.

In order to progress these plans after the year end, there were five issues of new shares for cash raising GBP1,329,000 before issue expenses.

Projected funding

At the time of preparing these financial statements, the Group has closed all its trading businesses, and is a Cash Shell awaiting new investment opportunities. The Directors believe that since the year-end, through share issues, the Group has raised sufficient cash resources for over 12 months to support its contracted and committed working capital requirements as an AIM quoted Cash Shell.

The Directors have announced that they are seeking new investment opportunities, and have indicated that further investment may be expected from shareholders when suitable investments have been identified. It is too early to predict the outcome of these reviews of potential investment opportunities.

Conclusion

After taking account of the Group and Company's current funding position, its cash flow projections and the risks and uncertainties associated with these, the directors have a reasonable expectation that the Group and Company have access to adequate resources to continue in operational existence for the foreseeable future. For these reasons they continue to prepare the financial

statements on a going concern basis. These financial statements do not include any adjustments that would result from the going concern basis of preparation being inappropriate.

   2.3     Consolidation 

These financial statements are the consolidated financial statements of Bould Opportunities PLC and all of its subsidiaries ("the Group").

Business combinations

Business combinations are accounted for using the acquisition method. The consideration for acquisition is measured at the fair values of assets given, liabilities incurred or assumed, and equity instruments issued by the Company in order to obtain control of the acquiree (at the date of exchange). Costs such as professional fees incurred in connection with the acquisition are recognised in the statement of comprehensive income as incurred.

If the initial accounting for a business combination is incomplete by the end of the reporting period in which it occurred, provisional amounts are reported for the items for which the accounting is

incomplete. During the measurement period, the provisional amounts recognised at the acquisition date are adjusted retrospectively to reflect new information obtained about the facts and circumstances that existed at the acquisition date and which, if known, would have affected the measurement of the amounts recognised at that date. The measurement period is the period from the acquisition date to the date by which complete information has been received about the facts and circumstances at the acquisition date, subject to a maximum of one year.

Subsidiaries

Where the Company has control over an investee, it is classified as a subsidiary. The Company controls an investee if all three of the following elements are present: power over the investee, exposure to variable returns from the investee, and the ability of the investor to use its power to affect those variable returns. Control is reassessed whenever the facts and circumstances indicate that there may be a change in any of these elements of control. De-facto control exists in situations where the company has the practical ability to direct the relevant activities of the investee without holding the majority of the voting rights.

Inter-company transactions, balances and unrealised gains and losses on transactions between Group companies are eliminated.

   2.4     Segmental reporting 

IFRS 8 requires that segmental information be disclosed on the basis of information reported to the chief operating decision maker. The Group considers that the role of chief operating decision maker is performed by the Group's Board of Directors.

There were substantial changes to the Group's operations in 2018. From the start of 2018, the Group had different entities in the United Kingdom operating as wholly-owned subsidiaries. Their primary activities focused on the supply of LED lighting fixtures whilst transforming the Group to a future main focus as a LED lighting services business. The Group operated in three reporting segments, LED Lighting Fixtures - placed in to liquidation in November 2018, Halcyon and LED light engines - continuing in business through the whole of 2018, and Contract Manufacturing - sold in January 2018. Information on the segments and discontinued businesses consistent with the Group's internal reporting is provided in Note 5.

   2.5     Foreign currency translation 

The functional currency of the Company and each of its subsidiary companies is Sterling. Foreign currency assets and liabilities are converted into Sterling at the rates of exchange ruling at the end of the financial year. Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the statement of comprehensive income.

   2.6     Investments in subsidiaries 

Investments in subsidiaries are stated at cost less accumulated impairment.

   2.7     Intangible fixed assets - patents, development costs, customer lists and goodwill 

Patents and development costs

Acquired patents associated with internally developed intellectual property are recognised initially at cost. Patents have a finite useful life and are carried at cost less accumulated amortisation. Amortisation is calculated using the straight-line method to allocate the cost over their estimated useful lives (5 years).

The costs associated with acquiring patents relating to technology which are no longer integral to the product range planned for market are expensed to the statement of comprehensive income.

Development costs capitalised under IAS38 are carried at cost less accumulated amortisation. Amortisation is calculated using the straight-line method to allocate the cost over their estimated useful lives (5 years). Amortisation only commences when the asset is available for use.

Intangible amortisation is recognised within administrative expenses in the statement of comprehensive income.

Customer lists

Customer lists are stated at fair value on acquisition less amortisation recognised since acquisition.

Amortisation of customer lists is calculated using the straight-line method to allocate their cost to their residual values over their estimated useful lives, as follows:

Architectural Lighting & Controls customer list - 6 years

Goodwill

Goodwill arising on acquisition is the residual cost of the acquisition after allocation of the consideration paid to the fair value of the net tangible and other intangible assets acquired. Goodwill valuation is subject to annual review for impairment and any write-down resulting from impairment is charged to the statement of comprehensive income.

   2.8       Property, plant and equipment 

All plant and equipment are stated at cost less accumulated depreciation. The cost of plant and equipment includes expenditure that is directly attributable to the acquisition of the assets.

Depreciation on all plant and equipment is calculated using the straight-line method to allocate cost less residual value over estimated useful life, as follows:

   Plant and equipment      3 - 5 years 

Residual values, remaining useful lives and depreciation methods are reviewed annually and adjusted if appropriate. An asset's carrying amount is written down immediately to its recoverable amount if the asset's carrying amount is greater than its estimated recoverable amount.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in the statement of comprehensive income. Repairs and maintenance expenditure is written off to the statement of comprehensive income as incurred.

   2.9        Research and development 

Expenditure on research is charged to the statement of comprehensive income as incurred. Expenditure on product development is capitalised as an intangible asset in the statement of financial position from the date that the expenditure incurred on the development meets all the capitalisation criteria detailed below:

-- Technical feasibility of completing the asset so that it will be available for use or sale can be demonstrated;

   --      The intention to complete the asset and use or sell it can be demonstrated; 
   --      The ability to use or sell the asset can be demonstrated; 
   --      The ability to demonstrate how the asset will generate probable future economic benefits; 

-- The ability to demonstrate the availability of adequate technical, financial and other resources to complete the development and to use or sell the asset; and

-- The ability to measure reliably the expenditure attributable to the asset during its development.

Expenditure on product development is expensed to the statement of comprehensive income as incurred where the capitalisation criteria are not met. Development costs recognised as an expense are not recognised as an asset in a subsequent period.

   2.10        Impairment of non-financial assets 

The Group assesses annually whether there is any indication that any of its assets have been impaired. If such indication exists, the asset's recoverable amount is estimated and compared to it carrying value. Where it is impossible to estimate the recoverable amount of an individual asset, the Group estimates the recoverable amount of the smallest cash-generating unit to which the asset is allocated.

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount an impairment loss is recognised immediately in the statement of comprehensive income, unless the asset is carried at a revalued amount, in which case the impairment loss is recognised as a decrease in the revaluation reserve to the extent of any previous surplus with any further loss being recognised in the statement of comprehensive income.

For goodwill, intangible assets that have an indefinite life and intangible assets not yet available for use, the recoverable amount is estimated annually or whenever there is an indication of impairment.

   2.11       Trade receivables 

Trade receivables are stated at the original invoice amount less provision for impairment. A provision for impairment of trade receivables is established when there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of the receivables. Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganisation, and default or delinquency in payment are considered indicators that the trade receivable is impaired. The carrying amount of the asset is reduced through the use of a provision account and the amount of the loss is recognised within administrative expenses in the statement of comprehensive income. Trade receivables are not discounted as the effect would be immaterial.

   2.12   Inventories 

Inventories are stated at the lower of cost and net realisable value. Cost is determined using the first in, first out method. The cost of finished goods and work in progress comprises the purchase price including transport and handling costs and attributable manufacturing overheads.

Net realisable value is the estimated selling price in the ordinary course of business, less applicable variable selling expenses.

   2.13   Cash and cash equivalents 

Cash and cash equivalents include cash in hand, deposits held at call with banks and other short-term highly liquid investments, with original maturities of three months or less.

   2.14   Share capital 

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds.

   2.15   Trade payables 

Trade payables are non-derivative financial liabilities with fixed or determinable payments. Trade payables are included in current liabilities, except for maturities greater than 12 months after the statement of financial position date. These are classified as non-current liabilities. Trade payables are recognised at cost. They are not discounted as the effect would be immaterial.

   2.16   Borrowings 

Borrowings are recognised initially at fair value, net of transaction costs incurred. Borrowings are subsequently stated at amortised cost with any difference between the proceeds (net of transaction costs) and the redemption value recognised in the statement of comprehensive income over the period of the borrowings using the effective interest rate method.

Borrowings are classified as current liabilities unless the Company has an unconditional right to defer settlement of the liability for at least 12 months after the balance sheet date.

   2.17   Current and deferred income tax 

Current income tax is calculated on the basis of the tax laws enacted or substantively enacted at the statement of financial position date in the countries where the Company's subsidiaries and associates operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation and establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.

Deferred income 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. However, deferred income 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 nor loss. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantively enacted by the statement of financial position date and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled. Deferred income tax assets are recognised to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilised.

   2.18      Revenue 

Revenue comprises the fair value of the consideration received or receivable for the sale of goods and services. Revenue is shown net of value added taxes, returns and rebates.

Revenue is recognised when the amount can be reliably measured and it is probable that future economic benefit will flow to the Group under the terms of any sale agreements. This normally corresponds to the date that goods are either despatched to customers, or in the case of ex-works customers the goods are available for collection. Revenue is not considered to be reliably measurable until all contingent clauses in sale agreements are met.

Details of the accounting policy for warranty and stock return provisions are in Note 2.22.

   2.19     Government grants 

Grants from the Government are recognised at their fair value where there is reasonable assurance that the grant will be received and that the Group will comply with all attached conditions.

Government grants relating to costs are deferred and recognised in other income in the statement of comprehensive income over the period necessary to match them with the costs that they are intended to compensate.

Capital grants that relate to specific capital expenditure are included in current and non-current liabilities as deferred income which is credited to the statement of comprehensive income over the related asset's useful life.

   2.20       Operating leases 

Operating lease payments are recognised as an expense on a straight-line basis over the lease term. Contingent rentals arising under operating leases are recognised in the period in which they are incurred.

   2.21       Share based payments 

The Group operates an equity-settled, share-based compensation plan. The fair value of the employee services received in exchange for the grant of the options is recognised as an expense and credited to the share option reserve within equity. The total amount to be expensed over the vesting period is determined by reference to the fair value of the options granted, excluding the impact of any non-market vesting conditions (for example, profitability and sales growth targets). Options that lapse before vesting are credited back to income.

The proceeds received net of any directly attributable transaction costs are credited to share capital (nominal value) and, if applicable, share premium when the options are exercised.

   2.22       Provisions 

The Group's principal provisions relate to product warranties and stock returns from distributors.

Provisions are recognised when the Group has a present obligation as a result of an event that occurred in the past and the settlement of that obligation will result in an outflow of resources, but the timing of or amount that will be required to settle is uncertain. The amount recognised as a provision is the best estimate of the consideration which will be required to settle the obligation.

   2.23      Financial instruments 

i) Financial assets

From 1 January 2018 the Group and Company classifies its financial assets in the following measurement categories:

   --      those to be measured subsequently at fair value through profit or loss; and 
   --      those to be measured at amortised cost. 

The classification depends on the business model for managing the financial assets and the contracted terms of the cash flows. Financial assets are classified as at amortised cost only if both of the following criteria are met:

-- the asset is held within a business model whose objective is to collect contracted cash flows; and

-- the contractual terms give rise to cash flows that are solely payments of principal and interest.

Financial assets, including trade and other receivables and cash and bank balances, are initially recognised at transaction price, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.

Such assets are subsequently carried at amortised cost using the effective interest method.

At the end of each reporting period financial assets measured at amortised cost are assessed for objective evidence of impairment. If an asset is impaired the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset's original effective interest rate. The impairment loss is recognised in the consolidated income statement.

The Group and Company applies the simplified approach in calculating the expected credit losses (ECLs) as permitted by IFRS 9. Changes in credit risk is not tracked but instead a loss allowance is recognised at each reporting date based on the financial asset's; lifetime ECL

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been had the impairment not previously been recognised. The impairment reversal is recognised in the consolidated income statement.

Financial assets are derecognised when (a) the contractual rights to the cash flows from the asset expire or are settled, or (b) substantially all the risks and rewards of the ownership of the asset are transferred to another party or (c) despite having retained some significant risks and rewards of ownership, control of the asset has been transferred to another party who has the practical ability to unilaterally sell the asset to an unrelated third party without imposing additional restrictions

ii) Financial liabilities

Basic financial liabilities, including trade and other payables, are initially recognised at transaction price, unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest.

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade payables are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Financial liabilities are derecognised when the liability is extinguished, that is when the contractual obligation is discharged, cancelled or expires.

The group does not hold or issue derivative financial instruments.

iii) Offsetting

Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is an enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle to liability simultaneously.

2.4 Pensions

For defined contribution schemes the amount charged to the statement of comprehensive income is the contribution payable in the year. Differences between the contributions payable in the year and contributions actually paid are shown either as accruals or prepayments.

   3       Financial risk 

Many of the Group's risks were reduced significantly during 2018 as most of the Group's trading activities were curtailed.

   3.1    Capital risk management 

The Group monitors capital which comprises all components of equity (i.e. share capital, share premium, capital reduction reserve, share option reserve, and retained earnings/losses). Note 29 describes how capital is managed in respect of the debt to equity ratio.

   3.2     Financial risk factors 

The Group and Company's operations exposed it to a variety of financial risks that had included the effects of credit risk, liquidity risk and interest rate risk. The Group and Company had in place a risk management programme that attempted to limit the adverse effects on the financial performance of the Group and Company by monitoring levels of debt finance and the related finance costs. The Group and Company did not use derivative financial instruments to manage interest rate costs and as such, no hedge accounting was applied.

Given the size of the Group and Company, the directors did not delegate the responsibility of monitoring financial risk management to a sub-committee of the Board. The policies set by the board of directors were implemented by the Group and Company's finance department.

   (a)      Market risk 
   (i)       Foreign exchange risk 

The Group distributed and sold internationally and was exposed to foreign exchange risk arising from various currency exposures, primarily with respect to the US dollar and Sterling. Foreign exchange risk arose from future commercial transactions and translation of foreign currency denominated monetary assets and liabilities. Foreign currency risk was managed via the purchase of raw materials and the sale of products in equivalent currencies. A sensitivity analysis was not performed because the Group's exposure to foreign exchange risk was not significant.

   (ii)     Price risk 

The Group had periodic price reviews within distributor sales contracts that enabled it to reassess and adjust for price risk as part of contractual negotiations. Commodity price risk is assessed as medium as a result of the various supply alternatives available for key components. Any increase or decrease in commodity prices had a direct impact on EBITDA until sales prices can be renegotiated.

   (b)      Credit risk 

The Group implemented policies that required appropriate credit checks on potential customers before sales were made. The Group's credit risk was primarily attributable to its trade receivables balance. The amounts presented in the statement of financial position are net of allowances for impairment.

   (c)      Liquidity risk 

Liquidity risk was the risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities. The Group's financial liabilities included its borrowings and trade and other payables shown in Note 15. Responsibility for monitoring liquidity risk and for ensuring that Group members are adequately funded lies with the board of the Parent Company, Bould Opportunities PLC.

   (d)      Interest rate cash flow risk 

The Group had both interest-bearing assets and interest-bearing liabilities. Interest bearing assets comprised only cash balances, which earned interest at floating rates. Interest bearing liabilities comprised debt at fixed and floating rates.

   4         Critical accounting estimates and judgements 

In the preparation of the financial statements the directors must make estimates and assumptions that affect the asset and liability items and revenue and expense amounts recorded in the financial statements. These estimates are based on historical experience and various other assumptions that the Board believes are reasonable under the circumstances. The results of this form the basis for making judgements about the carrying value of assets and liabilities that are not readily available from other sources.

   a)       Accounting judgement 

There were no judgments made.

   b)       Accounting estimate 

The principal area where estimates have been made in the financial statements is in respect of intangible assets and the level of impairment required which is dependent on future revenue growth and margins (see note 32, Impairment Review).

Impairment of non-current assets

Determining whether intangible assets or plant and equipment are impaired requires an estimation of the value in use of those assets. The value in use calculation requires the Group to estimate the future cash flows expected to arise from the business or asset and to apply a suitable discount rate in order to calculate present value. At the 2018 year end the only remaining non-current assets were in respect of the Halcyon and light engines business; these assets were impaired to zero as a result of the decision soon after the year end in January 2019 to close this business, and the assets were not expected to realise any value.

Stock provisions

The directors review at each reporting date the net realisable value of all stock. Where the cost of stock is believed to exceed its net realisable value, stock provisions are made to reduce cost to net realisable value, taking into account the costs of disposal. At the 2018 year end the only remaining stock was in respect of the Halcyon and light engines business; this asset was impaired to zero as a result of the decision soon after the year end in January 2019 to close the business, and the stock was not expected to realise any value.

Deferred tax

The Group has tax losses of GBP8.5m (2017: GBP10.4m) available for off-set against future taxable profits. In determining the value of the deferred tax asset that can be attributed to these losses, the directors have to estimate future taxable profits and the period over which the asset may be recovered. The directors consider the most up-to-date forecasts for the business and assess the risks inherent in achieving those forecasts. At the statement of financial position date, no deferred tax asset has been recorded. The deferred tax asset may be recognised in the future if there is an improvement in the forecast taxable profits.

Share based payments

See Note 13 which explains the methods used to estimate the fair value of share options granted.

   5         Continuing and discontinued operations 

5a Summary

 
 As explained in note 1, during 2018 the following group's operations 
 were discontinued: 
 
 (i) On 30 January 2018 the group announced the sale of its contract 
  manufacturing subsidiary, Camtronics Vale Limited. The total sales 
  consideration was GBP901,000 (see note 5c) 
 
 (ii) On 24 October 2018 the group's bankers appointed an administrator 
  to the LED lighting and fixtures subsidiary, Photonstar LED Limited. 
  On 18 November 2018 a liquidator was appointed to this subsidiary. 
  No distribution is expected from the liquidator. 
 (iii) At the time of its liquidation, Photonstar LED Limited 
  was the parent company for its dormant subsidiary Architectural 
  & Lighting Controls Limited. No distribution is expected from 
  the liquidator in respect of this subsidiary. 
 
 At 31 December 2018 the two continuing operations were the activities 
  of the holding company and the operations of the subsidiary Photonstar 
  Technology Limited that comprises the business segment for Halcyon 
  and light engines. 
 
 After the year end, on 30 January 2019, the Directors announced 
  their intention to close the Halcyon and light engines business, 
  and the holding Company would then continue as a Cash Shell until 
  appropriate new investments were found. This plan was confirmed 
  by resolution at the General Meeting of the Company on 5 April 
  2019. 
 
 In this note, financial information is provided for the two ongoing 
  operations at 31 December 2018 and separate financial information 
  is shown for each discontinued operation. 
 
 
 
   5b   Continuing operations - segmental information 
 
 Halcyon & light engines segment: 
                                             2018     2017 
                                           GBP000   GBP000 
----------------------------------------  -------  ------- 
 
 Revenue - all UK                              74      293 
----------------------------------------  -------  ------- 
 
 Adjusted EBITDA for reportable segment     (373)    (327) 
 Depreciation and amortisation              (536)    (495) 
 Impairment                                 (501)    (748) 
 Interest expense                               -        - 
 Tax credit                                   118      104 
 
 Total assets                                  15      888 
 Total liabilities                            214      206 
 
 Additions to non-current assets              176      380 
----------------------------------------  -------  ------- 
 

'Adjusted EBITDA for reportable segments' above is defined as EBITDA before share option charge and corporate expenses, and 'Adjusted EBITDA' below is defined as EBITDA before share option charge and exceptional item. Corporate expenses consist mainly of certain expenses of the parent undertaking such as legal, professional and consultancy costs related to the Group's listing on AIM and other central costs not allocated to business segments. Adjusted EBITDA, rather than the traditional EBITDA measure, is used as an alternative performance measure because it is a fairer approximation of operating cash flows.

Note that the Adjusted EBITDA reported in these financial statements is not considered to be a substitute for those figures reported under IFRS.

A reconciliation of the adjusted EBITDA to the loss before tax for continuing operations is as follows:

 
                                               Total      Total 
                                                2018       2017 
                                             GBP'000    GBP'000 
-----------------------------------------  ---------  --------- 
 Continuing operations: 
 Adjusted EBITDA for reportable segments       (373)      (327) 
 Corporate expense                             (323)       (35) 
-----------------------------------------  ---------  --------- 
 Adjusted EBITDA                               (696)      (362) 
 Depreciation and amortisation                 (536)      (495) 
 Impairment                                    (501)      (748) 
 Share option charge                               -       (39) 
 Interest expense                                  -          - 
 Loss before tax                             (1,733)    (1,644) 
-----------------------------------------  ---------  --------- 
 

A reconciliation of the reportable segments' assets to the Group's total assets is as follows:

 
                                                   Total      Total 
                                                    2018       2017 
                                                 GBP'000    GBP'000 
---------------------------------------------  ---------  --------- 
 Segment assets for reportable segments               15        888 
 Assets of discontinued segments                       -      2,035 
 Cash at bank                                          4         44 
 Other                                                77        118 
 Total assets per the statement of financial 
  position                                            96      3,085 
---------------------------------------------  ---------  --------- 
 

A reconciliation of the reportable segments' liabilities to the Group's total liabilities is as follows:

 
                                               Total      Total 
                                                2018       2017 
                                             GBP'000    GBP'000 
--------------------------------------  ------------  --------- 
 Segment liabilities for reportable 
  continuing segments                            214        888 
 Liabilities of discontinued segments              -        608 
 Borrowings                                        -        833 
 Other                                           117         15 
--------------------------------------  ------------  --------- 
 Total liabilities per the statement 
  of financial position                          331      2,344 
--------------------------------------  ------------  --------- 
 

5c Discontinued operations

The Group's net loss on discontinued operations may be analysed as follows:

 
                                      Note     2018     2017 
                                             GBP000   GBP000 
-----------------------------------  -----  -------  ------- 
 
 Camtronics Vale Limited              5c        110     (86) 
 Photonstar LED Limited               5d      (446)    (284) 
 Architectural & Lighting Controls 
  Limited                             5e      (106)        - 
 Group net loss on discontinued 
  operations                                  (442)    (370) 
-----------------------------------  -----  -------  ------- 
 

Additional financial information for each of these discontinued operations is set out below. This information incorporates the segmental results for the prior period.

   5c   Details of the sale of Camtronics Vale Limited 

The financial performance and cash flow information presented are for the one month ended 31 January 2018 and for the year ended 31 December 2017.

 
                                                              2018     2017 
                                                            GBP000   GBP000 
---------------------------------------------------------  -------  ------- 
 Revenue                                                       133     1679 
 Expenses                                                    (148)   (1765) 
---------------------------------------------------------  -------  ------- 
 Loss before income tax                                       (15)     (86) 
 Income tax expense                                              -        - 
---------------------------------------------------------  -------  ------- 
 Loss after tax for discontinued operation                    (15)     (86) 
 Gain on sale of the subsidiary after tax - see below          125        - 
---------------------------------------------------------  -------  ------- 
 Comprehensive income/(loss) from discontinued operation       110     (86) 
---------------------------------------------------------  -------  ------- 
 

Net cash outflow from operating activities:

 
                                                  2018     2017 
                                                GBP000   GBP000 
--------------------------------------------  --------  ------- 
 
 Net cash outflow from investing activities          -      (1) 
 Net cash outflow from financing activities          -     (34) 
 Net cash (decrease) from subsidiary                 -     (35) 
--------------------------------------------  --------  ------- 
 

Details of sale of subsidiary:

 
                                         2018 
                                       GBP000 
------------------------------------  ------- 
 Consideration receivable: 
 Cash paid and payable                    150 
 Debts novated                            751 
------------------------------------  ------- 
 Total disposal consideration             901 
 Carrying amount of net assets sold     (776) 
------------------------------------  ------- 
 Gain on sale before tax                  125 
 Income tax expense on gain                 - 
------------------------------------  ------- 
 Gain on sale after tax                   125 
------------------------------------  ------- 
 

The carrying amounts of assets and liabilities as at the date of sale were:

 
                                       30 January 
                                             2018 
                                           GBP000 
-----------------------------------  ------------ 
 
 Goodwill                                      13 
 Property, plant & equipment                  267 
 Inventories                                  186 
 Trade receivables and prepayments           1111 
 Cash                                           2 
 Total assets                                1579 
-----------------------------------  ------------ 
 
 Trade creditors and accruals                 331 
 Bank borrowings and hire purchase            457 
 Deferred tax                                  15 
 Total liabilities                            803 
-----------------------------------  ------------ 
 
 Net assets at the date of sale               776 
-----------------------------------  ------------ 
 

The financial performance and cash flow information presented are for the 10 months ended 31 October 2018 and for the year ended 31 December 2017

 
                                                       2018      2017 
                                                     GBP000    GBP000 
-------------------------------------------------  --------  -------- 
 
 Revenue                                              1,682     2,575 
 Expenses                                           (2,000)   (2,924) 
-------------------------------------------------  --------  -------- 
 Loss before income tax                               (318)     (349) 
 Income tax                                               -        65 
-------------------------------------------------  --------  -------- 
 Loss after tax for discontinued operation            (318)     (284) 
 Loss on liquidation of the subsidiary after tax 
  - see below                                       (1,033)         - 
-------------------------------------------------  --------  -------- 
 Comprehensive income/(loss) from discontinued 
  operation                                         (1,351)     (284) 
-------------------------------------------------  --------  -------- 
 

Net cash outflow from operating activities:

 
                                                          2018     2017 
                                                        GBP000   GBP000 
-----------------------------------------------------  -------  ------- 
 
 Net cash out flow from investing activities              (22)     (29) 
 Net cash out flow/in flow from financing activities     (124)       58 
 Net cash (decrease)/increase from subsidiary            (146)       29 
-----------------------------------------------------  -------  ------- 
 
   5d   Details as a result of the liquidation of Photonstar LED Ltd 

Details of liquidation of subsidiary:

 
                                                  2018     2017 
                                                GBP000   GBP000 
---------------------------------------------  -------  ------- 
 
 Distribution expected from liquidator               -        - 
 Carrying amount of net assets on appointment 
  of liquidator                                  (128)        - 
---------------------------------------------  -------  ------- 
 (Loss) on liquidation before tax                (128)        - 
 Income tax                                          -        - 
---------------------------------------------  -------  ------- 
 (Loss) on liquidation after tax                 (128)        - 
---------------------------------------------  -------  ------- 
 

The carrying amounts of assets and liabilities as at the date of liquidation were:

 
                                           18 November 
                                                  2018 
                                                GBP000 
---------------------------------------  ------------- 
 
 Property, plant & equipment                        32 
 Intangible fixed assets                           102 
 Trade receivables and prepayments                 255 
 Inventories                                       345 
 Cash                                                7 
 Total assets                                      741 
---------------------------------------  ------------- 
 
 Trade creditors and accruals                      413 
 Bank borrowings                                   200 
 Total liabilities                                 613 
---------------------------------------  ------------- 
 
 Net assets at the date of liquidation             128 
---------------------------------------  ------------- 
 

5e Details as a result of a liquidator appointed to the parent company of Architectural Lighting and Controls Limited

Architectural Lighting & Controls Limited was a dormant subsidiary, and therefore had no income or expense or cash flows for the relevant reporting periods.

Details resulting from the liquidation of the parent company:

 
                                                     2018     2017 
                                                   GBP000   GBP000 
------------------------------------------------  -------  ------- 
 
 Distribution expected from liquidator                  -        - 
 Carrying amount of net assets on appointment of 
  liquidator                                          106        - 
------------------------------------------------  -------  ------- 
 Loss on liquidation before tax                     (106)        - 
 Income tax expense on loss                             -        - 
------------------------------------------------  -------  ------- 
 Loss on liquidation after tax                      (106)        - 
------------------------------------------------  -------  ------- 
 

The carrying amounts of assets and liabilities as at the date of liquidation were:

 
                                           18 November 
                                                  2018 
                                                GBP000 
---------------------------------------  ------------- 
 
 Goodwill                                          106 
 Total assets                                      106 
---------------------------------------  ------------- 
 
 Total liabilities                                   - 
---------------------------------------  ------------- 
 
 Net assets at the date of liquidation             106 
---------------------------------------  ------------- 
 
   6a        Operating loss (continuing and discontinued operations) 
 
 Operating loss is stated after        2018       2017 
  charging/(crediting):             GBP'000    GBP'000 
--------------------------------  ---------  --------- 
 Cost of inventory recognised 
  as expense                          1,211      3,095 
 Staff costs                          1,050      1,738 
 Pension contributions                    6         10 
 Depreciation                            29         86 
 Amortisation of intangible 
  assets                                595        582 
 Operating lease expense                 66        141 
 Government grant income               (54)       (60) 
--------------------------------  ---------  --------- 
 
   6b       Exceptional item (continuing operations) 
 
                                                                 2018        2017 
                                                                         Restated 
                                                              GBP'000     GBP'000 
-------------------------------------  ------------------------------  ---------- 
 Impairment of development 
  costs                                                             -       (748) 
 Impairment of Photonstar Technology                            (501)           - 
  Limited assets 
 Total exceptional item                                         (501)       (748) 
-------------------------------------  ------------------------------  ---------- 
 

Exceptional items are shown in the Statement of Comprehensive Income as an administrative expense.

   6c        Other Income 
 
                                2018       2017 
                             GBP'000    GBP'000 
-------------------------  ---------  --------- 
 Government Grant Income          54         67 
-------------------------  ---------  --------- 
 
   7         Investments in subsidiary undertakings 
 
 Company                          2018       2017 
                               GBP'000    GBP'000 
--------------------------  ----------  --------- 
 Opening balance                     -      3,795 
 Provision for impairment            -    (3,795) 
--------------------------  ----------  --------- 
 Closing balance                     -          - 
--------------------------  ----------  --------- 
 

Note 32 sets out the group-level impairment review and concludes there should be an impairment charge to the consolidated balance sheet of GBP501,000 (2017: GBP836,000). In the Company's own financial statements, a provision for impairment has been recorded in order to adjust the book value of the Parent Company's investments to the value in use of the subsidiaries that is estimated in the Group's impairment review. This provision for impairment has no impact on the consolidated financial statements.

 
 Name                          Country of incorporation  Proportion of ownership         Principal activities/status 
                                                         interest 
 
 PhotonStar LED                England and Wales         100% interest in ordinary       Design and development of LED 
  Limited                                                share capital                   lighting fixtures/With 
                                                                                         liquidator November 2018 
 PhotonStar Technology         England and Wales         100% interest in ordinary       Design and development of 
 Limited                                                 share capital                   halcyon(TM) and LED light 
                                                                                         engines 
-----------------------------  ------------------------  ------------------------------  ----------------------------- 
 Camtronics Vale Limited       England and Wales         100% interest in ordinary       Specialist electronics 
                                                         share capital                   manufacture/Sold January 2018 
-----------------------------  ------------------------  ------------------------------  ----------------------------- 
 Enfis Limited                 England and Wales         100% interest in ordinary       Dormant 
                                                         share capital 
-----------------------------  ------------------------  ------------------------------  ----------------------------- 
 Architectural Lighting &      England and Wales         100% interest in ordinary       Dormant/With liquidator 
 Controls Limited                                        share capital*                  November 2018 
-----------------------------  ------------------------  ------------------------------  ----------------------------- 
 

*Shares held by subsidiary Company.

The registered address for ongoing subsidiaries is New Liverpool House, 15 Eldon Street, London EC2M 7LD.

   8       Property, plant and equipment 
 
                                  Property, 
   Group                          plant and 
                                  equipment 
                                    GBP'000 
------------------------------  ----------- 
 Cost 
 At 1 January 2017                    1,345 
 Additions                               27 
 Disposals                             (12) 
 At 31 December 2017                  1,360 
 Additions                                - 
 Disposals                          (1,256) 
 At 31 December 2018                    104 
------------------------------  ----------- 
 
 Accumulated depreciation and 
  impairment 
 At 1 January 2017                      951 
 Charge for the year                     86 
 Disposal                              (12) 
 At 31 December 2017                  1,025 
 Charge for the year                     29 
 Impairment                               9 
 Disposal                             (959) 
 At 31 December 2018                    104 
------------------------------  ----------- 
 
 Net book value 
 At 31 December 2018                      - 
------------------------------  ----------- 
 At 31 December 2017                    335 
------------------------------  ----------- 
 At 31 December 2016                    394 
------------------------------  ----------- 
 

The Company has no property, plant and equipment.

   9         Intangible fixed assets 

Group

 
                                Patents and licences   Customer   Goodwill     Development costs    Total 
                                             GBP'000       list                          GBP'000 
                                                        GBP'000    GBP'000                          GBP'000 
----------------------------  ----------------------  ---------  ---------  --------------------  --------- 
 Cost 
 At 1 January 2017                               603        243      1,833               3,450        6,129 
 Additions                                        28          -          -                 412          440 
 Disposals                                      (88)          -          -                   -         (88) 
 At 31 December 2017                             543        243      1,833               3,862        6,481 
 Additions                                         4          -          -                 172          176 
 Disposals                                     (425)          -          -               (237)        (662) 
 At 31 December 2018                             122        243      1,833               3,797        5,995 
----------------------------  ----------------------  ---------  ---------  ------------------  ----------- 
 
 Amortisation and impairment 
 At 1 January 2017                               482        240      1,626               1,883        4,231 
  9 
 Charge for the year                              57          3          -                 522          582 
 Disposals                                      (85)          -          -                   -         (85) 
 Impairment (see Note 33)                          -          -         88                 748          836 
 At 31 December 2017                             454        243      1,714               3,153        5,564 
 Charge for year                                  40          -          -                 555          595 
 Disposals                                     (372)          -          -               (185)        (557) 
 Impairment (see Note 33)                          -          -        119                 274          393 
 At 31 December 2018                             122        243      1,833               3,797        5,995 
----------------------------  ----------------------  ---------  ---------  ------------------  ----------- 
 
 Net book value 
 At 31 December 2018                               -          -          -                   -            - 
----------------------------  ----------------------  ---------  ---------  ------------------  ----------- 
 At 31 December 2017                              89          -        119                 709          917 
----------------------------  ----------------------  ---------  ---------  ------------------  ----------- 
 At 31 December 2016                             121          3        207               1,567        1,898 
----------------------------  ----------------------  ---------  ---------  ------------------  ----------- 
 
 

Included within additions to development costs are costs of GBP172,000 (2017: GBP259,000) which are staff and other internal costs capitalised in the year.

Patents include the external third-party cost associated with the acquisition of patents for internally developed intellectual property and technical expertise. Intangible amortisation is recognised within administrative expenses in the statement of comprehensive income. The costs associated with acquiring patents relating to technology which are not integral to the product range planned for market have been expensed to the statement of comprehensive income during the period.

Goodwill of GBP119,000 consisting of GBP106,000 to the acquisition of Architectural Lighting and Controls Limited and GBP13,000 to the acquisition of Camtronics Vale Limited was written off during the year.

   10       Inventories 
 
   Group                                               2018       2017 
                                                     GBP'000    GBP'000 
    Raw materials                                          -        923 
    Work in progress                                       -         85 
    Finished goods                                       103         63 
    Provision for obsolete and slow-moving stock       (103)      (310) 
   ----------------------------------------------  ---------  --------- 
    Total                                                  -        761 
   ----------------------------------------------  ---------  --------- 
 There was no remaining inventory at the 
  end of the year. Any stock owned by Photonstar 
  LED Limited was appropriated by the liquidator. 
  The stock for the remaining Halcyon and 
  light engines subsidiary was fully written 
  down due to the announcement to close the 
  business in January 2019. 
 
   11       Trade and other receivables 
 
                                                   Group    Company      Group    Company 
                                                    2018       2018       2017       2017 
                                                 GBP'000    GBP'000    GBP'000    GBP'000 
-----------------------------------  -------------------  ---------  ---------  --------- 
 Trade receivables                                    67         69        865          - 
 Less: provision for impairment                        -          -       (28)          - 
-----------------------------------  -------------------  ---------  ---------  --------- 
 Trade receivables (net)                            67           69        837          - 
 Amounts due from subsidiaries                         -      2,473          -      2,130 
 Less: provision for impairment                        -    (2,473)          -      (710) 
 Prepayments and other receivables                    25         10        111          5 
                                                      92         79        948      1,425 
-----------------------------------  -------------------  ---------  ---------  --------- 
 

Trade and other receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are classified as 'trade and other receivables' in the statement of financial position and are included in current assets, except for maturities greater than 12 months after the statement of financial position date. These are classified as non-current assets. The value of trade receivables shown above, in addition to the value of cash balances on deposit with counterparties (see Note 12), represents the Group's maximum exposure to credit risk. No collateral is held as security.

Amounts due from subsidiary undertakings represented net amounts provided to the Company's wholly owned subsidiary, PhotonStar Technology Limited. Receivables due from subsidiaries were unsecured and repayable on demand.

The fair value of trade and other receivables approximate to the net book values stated above.

As of 31 December 2018, trade receivables of GBPnil (2017: GBP99,000) were past their due date of receipt.

 
                                   2018       2017 
                                GBP'000    GBP'000 
---------------------------  ----------  --------- 
 Up to two months past due            -         59 
 Over two months past due             -         21 
 Total                                -         80 
---------------------------  ----------  --------- 
 

As of 31 December 2018, trade receivables of GBPnil (2017: GBP28,000) were impaired. The individually impaired receivables relate to balances where it has been assessed that the receivable is not expected to be recovered. The ageing of these receivables is as follows:

 
                                   2018       2017 
                                GBP'000    GBP'000 
---------------------------  ----------  --------- 
 Current                              -          - 
 Up to two months past due            -          - 
 Over two months past due             -         28 
---------------------------  ----------  --------- 
 

The Group's trade and other receivables above are denominated in Sterling, and are pledged as security for the invoice finance borrowings disclosed in Note 15.

Movements on the provision for impairment of trade receivables are as follows:

 
                                                      2018       2017 
                                                   GBP'000    GBP'000 
-----------------------------------------------  ---------  --------- 
 At 1 January                                           28         69 
 Utilised                                             (28)       (69) 
 Provision for impairment of trade receivables           -         28 
 At 31 December                                          -         28 
-----------------------------------------------  ---------  --------- 
 
   12        Cash and cash equivalents 

Cash and cash equivalents consist of cash on hand and balances with banks and investments in readily accessible money market instruments. Cash and cash equivalents included in the consolidated and Company statement of cash flows comprise the following statement of financial position amounts.

 
                               Group    Company      Group    Company 
                                2018       2018       2017       2017 
                             GBP'000    GBP'000    GBP'000    GBP'000 
-------------------------  ---------  ---------  ---------  --------- 
 Cash on hand & balances 
  with banks                      44          2         44          3 
-------------------------  ---------  ---------  ---------  --------- 
 

An analysis of cash balances is provided in Note 33.

   13        Share capital 
 
                            Number of shares in 
                             issue 
                           -------------------------  ---------- 
 Numbers in 000s             Ordinary   New ordinary    Deferred 
                               shares         shares   A' shares 
 Nominal value per share           1p          0.01p       0.99p 
 
 At 31 December 2016          187,958              -           - 
 Issued                        37,200              -           - 
 At 31 December 2017          225,158              -           - 
 Share division             (225,158)        225,158     225,158 
 Issued                             -      1,037,063           - 
 At 31 December 2018                -      1,262,221     225,158 
-------------------------  ----------  -------------  ---------- 
 

Notes to the financial statements for the year ended 31 December 2018

   13        Share capital (continued) 

The following table reconciles the total nominal value of the shares in issue:

 
                            Total nominal value of shares 
                             in issue 
                           ------------------------------------  ------- 
                            Ordinary   New ordinary    Deferred    Total 
                              shares         shares   A' shares 
 Nominal value per share          1p          0.01p       0.99p 
                              GBP000         GBP000      GBP000   GBP000 
 
 At 31 December 2016           1,879              -           -    1,879 
 Issued                          373              -           -      373 
 At 31 December 2017           2,252              -           -    2,252 
 Share division              (2,252)             23       2,229        - 
 Issued                            -            103           -      103 
 At 31 December 2018               -            126       2,229    2,355 
-------------------------  ---------  -------------  ----------  ------- 
 

The following table reconciles the movements in share capital during the year:

 
                                                Share 
                          Share     Share     capital    Total 
                        capital   premium   reduction 
                                              reserve 
                         GBP000    GBP000      GBP000   GBP000 
 
 At 31 December 2016      1,879     7,776      10,081   19,736 
 Issued                     373        52           -      425 
 At 31 December 2017      2,252     7,828      10,081   20,161 
 Issued                     103       978           -    1,081 
 At 31 December 2018      2,355     8,806      10,081   21,242 
---------------------  --------  --------  ----------  ------- 
 

In 2018 there were the following share issues: except as noted below, all share issues were for cash consideration.

 
                                      No of shares   Issue price 
                                            issued     per share 
 2018                                         000s         Pence 
-----------------------------------  -------------  ------------ 
 
 February                                  286,667         0.15p 
 April (67,696 issued for non-cash 
  consideration)                            71,729         0.15p 
 May                                       150,000         0.30p 
 August                                     28,667         0.15p 
 December                                  500,000         0.02p 
 
 Total issued                            1,037,063 
                                     ------------- 
 

On 10 May 2018 the company issued 15,000,000 broker warrants exercisable at 3 pence per ordinary share, the warrants were valid for one year. As at 31 December 2018 none of the warrants had been exercised or had lapsed.

Employee share schemes

   a.   Deferred payment share purchase plan 

The Group has a deferred payment share purchase plan which enables the funding of share purchases in the Group by executive directors and other employees. There are no current applications to purchase shares through this plan (2017: Nil applications).

   b.   Share options 

The Group has an Enterprise Management Incentive Share Option Scheme (EMI Scheme) and an Executive Share Option Scheme.

During 2018 no share options were granted to directors (2017: 4,350,000).

The exercise terms of all granted options as at 31 December 2018 are summarised below:

 
 Date of grant     Number of        Exercise 
                     options    price (pence 
                                  per share)       Exercise 
                                                 dates from 
---------------  -----------  --------------  ------------- 
 2010              4,318,864             2.8           2011 
 2012              1,070,000            13.5           2015 
 2013              2,000,000              10           2015 
 2014                920,000               7           2017 
 2015              1,700,000               5           2017 
  2016             2,820,000            1.85           2017 
 2017              2,100,000            0.85           2018 
---------------  -----------  --------------  ------------- 
 

The number and weighted average exercise price of the options that were exercisable at 31 December 2018 were 14,928,864 and 4.6p respectively (2017: 25,584,440 and 4.4p).

Movements in the number of share options outstanding and their related weighted average exercise prices are as follows:

 
                               Average 
                        exercise price        Options 
                            (pence per         number 
                                share) 
---------------------  ---------------  ------------- 
 At 31 December 2016                 5     23,547,995 
 Granted                          0.85      4,350,000 
 Lapsed                           0.05    (2,313,555) 
---------------------  ---------------  ------------- 
 At 31 December 2017               4.4     25,584,440 
 Lapsed                            4.0   (10,655,576) 
---------------------  ---------------  ------------- 
 At 31 December 2018               4.6     14,928,864 
---------------------  ---------------  ------------- 
 

Share options outstanding at the end of the year have the following expiry dates and exercise prices:

 
                  Exercise price      Options      Options 
   Expiry date        (pence per         2018         2017 
                          share) 
---------------  ---------------  -----------  ----------- 
 2020                        2.8    4,318,864    5,776,215 
 2022                         10            -      234,000 
 2022                       13.5    1,070,000    1,716,225 
 2023                         10    2,000,000    3,101,000 
 2024                          7      920,000    1,732,000 
 2025                          5    1,700,000    2,170,000 
 2026                       1.85    2,820,000    6,505,000 
 2027                       0.85    2,100,000    4,350,000 
---------------  ---------------  -----------  ----------- 
                                   14,928,864   25,584,440 
---------------  ---------------  -----------  ----------- 
 

The Company determines the fair value of its share option contracts on the grant date, adjusts this to reflect its expectation of the options that will ultimately vest, and then expenses the calculated balance on a straight line basis through its statement of comprehensive income over the expected vesting period with a corresponding credit to its share option reserve. Subsequent changes to the expectation of number of options that will ultimately vest are dealt with prospectively such that the cumulative amount charged to the statement of comprehensive income is consistent with latest expectations. Subsequent changes in market conditions do not impact the amount charged to the statement of comprehensive income.

The Company determines the fair value of its share option contracts using a model based on the Black-Scholes-Merton methodology. In determining the fair value of its share option contracts, the Company made the following assumptions (ranges are provided where values differ across tranches). Expected volatility was determined by reference to historical experience.

 
                                                                                Fair 
                             Expected                Expected   Risk free      value 
          Share   Exercise     option     Expected   dividend    interest   at grant 
  Grant   price      price       life   volatility      yield        rate       date 
   date   pence      pence      years            %          %           %      pence 
         ------  ---------  ---------  -----------  ---------  ----------  --------- 
 
   2017    0.85       0.85         10           34          0        1.30       0.08 
         ------  ---------  ---------  -----------  ---------  ----------  --------- 
 
   14        Financial assets and liabilities 

The tables below analyse the carrying value of financial assets and financial liabilities in the Group and

Company's statements of financial position. Further information on the classes that make up each category is provided in the notes indicated. The carrying value of each category is considered a reasonable approximation of its fair value. All amounts are due within one year.

 
Group                                Notes      2018      2017 
                                             GBP'000   GBP'000 
-----------------------------------  -----  --------  -------- 
Trade receivables                       11        67       865 
Cash and cash equivalents               12         4        44 
-----------------------------------  -----  --------  -------- 
Financial assets at amortised cost                71       909 
-----------------------------------  -----  --------  -------- 
 
Trade payables                          15       156       939 
Accruals                                15       128       283 
Borrowings                              15         -       833 
Financial liabilities at amortised 
 cost                                            284     2,055 
-----------------------------------  -----  --------  -------- 
 
Company 
-----------------------------------  -----  --------  -------- 
Amounts due from subsidiaries           11         -     1,420 
Cash and cash equivalents               12         2         3 
-----------------------------------  -----  --------  -------- 
Financial assets at amortised cost                 2     1,423 
-----------------------------------  -----  --------  -------- 
 
Trade payables                          15       109        58 
Amounts due to subsidiaries             15         -       739 
Accruals                                15        33        46 
-----------------------------------  -----  --------  -------- 
Financial liabilities at amortised 
 cost                                            142       843 
-----------------------------------  -----  --------  -------- 
 
   15        Trade and other payables 
 
                                            2018       2017 
   Group                                 GBP'000    GBP'000 
-------------------------------------  ---------  --------- 
 Trade payables                              156        939 
 Other creditors                               -         11 
 Social security and other taxes              59        264 
 Accruals                                    128        255 
 Deferred income - government grants           -         17 
-------------------------------------  ---------  --------- 
 Total                                       331      1,486 
-------------------------------------  ---------  --------- 
 Company 
-------------------------------------  ---------  --------- 
 Trade payables                              109         58 
 Accruals                                     33         46 
 Amounts due to subsidiaries                   -        739 
 Total                                       142        843 
-------------------------------------  ---------  --------- 
 
 
 Group                                                           Due   Due between one and three months 
                                                                  or                            GBP'000 
                                  due in less than one month GBP'000 
 
  Trade payables         Total 
                       GBP'000 
------------------  ----------  ------------------------------------  --------------------------------- 
 31 December 2018          156                                    36                                120 
------------------  ----------  ------------------------------------  --------------------------------- 
 31 December 2017          939                                   540                                399 
------------------  ----------  ------------------------------------  --------------------------------- 
 
 
 Group                            2018       2017 
  Borrowings                   GBP'000    GBP'000 
--------------------------  ----------  --------- 
 Current borrowings 
 Hire purchase agreements            -         98 
 Bank credit cards                   -          3 
 Invoice finance                     -        732 
--------------------------  ----------  --------- 
 Total                               -        833 
--------------------------  ----------  --------- 
 
   16          Deferred income tax 

There is an un-provided deferred tax asset arising on taxable losses of GBP8.5m (2017: GBP10.4m). In accordance with accounting standards, the deferred tax asset has not been recognised in the financial statements as there will not be sufficient future profits against which it could be recovered. This position is considered further in Subsequent Events Note 31, and will be reconsidered again once the Group demonstrates consistent profitability.

At the end of 2018 there was no deferred tax liability (2017: GBP15,000).

   17          Provisions 
 
 Group                            Warranty 
                                 provision 
                                   GBP'000 
-----------------------------  ----------- 
 At 1 January 2017                      44 
 Charged to income statement            44 
 Utilised                             (34) 
-----------------------------  ----------- 
 At 31 December 2017                    10 
 Charged to income statement             - 
 De-recognised                        (10) 
-----------------------------  ----------- 
 At 31 December 2018                     - 
-----------------------------  ----------- 
 

The Group had provided product warranties to certain customers. Provision has been made for the expected cost of meeting claims in respect of these arrangements. These balances related to the subsidiary Photonstar LED Limited that was put into liquidation on 18 November 2018. This balance has therefore been de-recognised.

Notes to the financial statements for the year ended 31 December 2018

   18        Auditor's remuneration 

During the year the Group obtained the following services from the Company's auditor as detailed below:

 
                                                            2018       2017 
                                                         GBP'000    GBP'000 
-------------------------------------------------  -------------  --------- 
 Fees payable to Company's auditor for the audit 
  of Parent Company's and consolidated financial 
  statements                                                  15         15 
 Fees payable to the Company's auditor and its 
  associates for other services: 
  - The audit of the Company's subsidiaries 
   pursuant to legislation                                    15         36 
  - Tax services 
    - Compliance                                               -          9 
 Total                                                        30         60 
-------------------------------------------------  -------------  --------- 
 
   19        Employee benefit expense 
 
 Group                        2018       2017 
                           GBP'000    GBP'000 
-----------------------  ---------  --------- 
 
 Wages and salaries            955      1,601 
 Social security costs          95        144 
 Share based payments            -         39 
-----------------------  ---------  --------- 
                             1,050      1,784 
-----------------------  ---------  --------- 
 

The average number of persons (including executive directors) employed by the Group during the year was:

 
By activity                      2018     2017 
                               Number   Number 
----------------------------  -------  ------- 
 
 Research and development           2        5 
 Sales                              8       12 
 Administration and finance         6        6 
 Production                        46       45 
----------------------------  -------  ------- 
                                   62       68 
----------------------------  -------  ------- 
 

During the year, the Company had 2 employees (2017: 2), including the directors.

   20        Financial expense (discontinued operations) 
 
 Group                                            2018      2017 
                                               GBP'000   GBP'000 
 Bank loans, overdrafts and invoice finance         26        38 
 Hire purchase and other interest                    -        15 
--------------------------------------------  --------  -------- 
                                                    26        53 
--------------------------------------------  --------  -------- 
 

Notes to the financial statements for the year ended 31 December 2018

   21        Directors' emoluments 
 
 Group                                              2018       2017 
                                                 GBP'000    GBP'000 
---------------------------------------------  ---------  --------- 
 Dr J S McKenzie                                     135        115 
 Dr M E Zoorob                                        43         83 
 J Freeman                                            51         18 
 Salary and Fees                                     229        216 
 Social security costs - employer's national 
  insurance                                           28         26 
 Share based charges                                   -         12 
 Pensions costs                                        2          1 
---------------------------------------------  ---------  --------- 
 Total                                               259        255 
---------------------------------------------  ---------  --------- 
 

Key management personnel are defined as Directors. Key management compensation comprises salaries and fees set out above and share options set out later in this note.

The emoluments of the highest paid Director were as follows:

 
 Group                       2018       2017 
                          GBP'000    GBP'000 
----------------------  ---------  --------- 
 Aggregate emoluments         135        115 
----------------------  ---------  --------- 
 

No share options were exercised by the highest paid Director in the year (2017: Nil). The highest paid Director received no share options during the year (2017: Nil).

Share options granted to the Directors under the Company's share option schemes are shown below:

 
                    31 December                         31 December 
                           2017     Issued     Lapsed          2018 
                         number     number     number        Number 
-----------------  ------------  ---------  ---------  ------------ 
 Dr J S McKenzie      6,359,710          -          -     6,359,710 
 Dr M Zoorob          5,435,456          -          -     5,435,456 
                     11,795,166          -          -    11,795,166 
-----------------  ------------  ---------  ---------  ------------ 
 

The period over which the options held by the Directors are exercisable is summarised below:

 
 Year of grant    Number of options   Exercise          Period of 
                             issued      price           exercise 
                                       (pence) 
---------------  ------------------  ---------  ----------------- 
 2010                     4,245,166        2.8        2009 - 2019 
 2012                     1,000,000       13.5        2015 - 2023 
 2013                     2,000,000         10        2015 - 2023 
 2014                       900,000          7        2015 - 2024 
 2015                       900,000      5.025        2016 - 2025 
 2016                     2,750,000       1.85        2017 - 2026 
 
 
   22        Income tax credit 
 
 Group                                                 2018       2017 
                                                    GBP'000    GBP'000 
------------------------------------------------  ---------  --------- 
 Current taxation; research and development tax 
  credits 
 UK corporation tax on loss for the year                  -      (137) 
 Adjustment in respect of prior periods               (118)       (32) 
------------------------------------------------  ---------  --------- 
                                                      (118)      (169) 
 Deferred tax                                             -          - 
------------------------------------------------  ---------  --------- 
 Income tax credit                                    (118)      (169) 
------------------------------------------------  ---------  --------- 
 Analysed: 
 Continuing operations                                (118)      (104) 
 Discontinued operations                                  -       (65) 
 

The tax on the Group's loss before tax differs from the theoretical amount that would arise using the tax rate applicable to the losses of the Group as follows:

 
 Group - continuing operations                     2018       2017 
                                                    GBP'000    GBP'000 
------------------------------------------------  ---------  --------- 
 Loss before tax on continuing operations          (1,782)    (1,644) 
------------------------------------------------  ---------  --------- 
 Tax calculated at the domestic rate applicable 
  of 19.25%                                        (343)      (316) 
 Expenses not deductible for tax purposes          150        173 
 R&D tax credit                                    -          (104) 
 Tax losses for which no deferred income tax 
  asset was recognised                             193        143 
 Adjustments in respect of prior periods           (118)      - 
------------------------------------------------  ---------  --------- 
 Total tax credit - continuing operations          (118)      (104) 
------------------------------------------------  ---------  --------- 
 
   23        Net foreign exchange loss 

The exchange differences charged to the consolidated statement of comprehensive income are as follows:

 
 Group             2018       2017 
                GBP'000    GBP'000 
------------  ---------  --------- 
 Loss - net           1          2 
------------  ---------  --------- 
 
   24        Earnings per share 
 
                                                          2018             2017 
   Basic loss per share 
---------------------------------------------  ---------------  --------------- 
 Loss from continuing operations                (GBP1,664,000)   (GBP1,540,000) 
 Total comprehensive loss                       (GBP2,106,000)      (1,910,000) 
 Weighted average number of ordinary shares        649,981,858      212,622,330 
 Loss per share from continuing operations              (0.2p)           (0.7p) 
 Loss per share from discontinued operations            (0.2p)           (0.2p) 
---------------------------------------------  ---------------  --------------- 
 Basic total comprehensive loss per share               (0.5p)           (0.9p) 
---------------------------------------------  ---------------  --------------- 
 

Diluted earnings per share is calculated by dividing the loss attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding after adjusting these amounts for the effects of dilutive potential ordinary shares.

As the results for the years ended 31 December 2018 and 31 December 2017 are a loss, any exercise of share options would have an anti-dilutive effect on earnings per share. Consequently, earnings per share and diluted earnings per share are the same and the calculation has not been included.

As at 31 December 2018, there were share options outstanding over 14,928,864 shares (2017: 25,584,440 shares), which could potentially have a dilutive impact in the future.

   25        Commitments 
   (a)        Capital commitments 

Capital commitments at 31 December 2018 GBPNil (31 December 2017: GBPNil)

   (b)        Operating lease commitments 

The Group leased buildings under non-cancellable leases from various landlords. Due to the changes in the Group's structure all leases have been terminated. The amount below is the payments made to surrender the leases.

The future aggregate minimum lease payments under these non-cancellable operating leases are as follows:

 
                                         2018       2017 
                                      GBP'000    GBP'000 
----------------------------------  ---------  --------- 
 Payable within one year                   54        165 
 Payable within two to five years           -        239 
 Payable over five years                    -         95 
----------------------------------  ---------  --------- 
                                           54        499 
----------------------------------  ---------  --------- 
 
   26        Related party transactions 

Transactions with and between subsidiaries

As at 31 December 2018 the Company had advanced GBP521,000 to Photonstar LED Limited (with liquidator) (2017: GBP674,000) and GBP2,473,000 to Photonstar Technology Limited (2017: GBP1,456,000), no balance was due to Camtronics Vale Limited (sold) (2017: GBP610,000), and no balance was due to Architectural & Lighting Controls Limited (with liquidator) (2017: GBP134,000). Further details of these advances are given in Note 11, Trade and other receivables, and in Note 15, Trade and other payables.

Transactions with directors

During the year an amount of GBP70,000 (2016: GBP94,000) was paid to related parties of the director in respect of services provided to the company.

   27        Controlling party 

The directors consider there to be no ultimate controlling party.

   28        Government grants 

Government grants credited to income are as follows:

 
 Group                    2018       2017 
                       GBP'000    GBP'000 
-------------------  ---------  --------- 
 Government grants          54         60 
-------------------  ---------  --------- 
 

The government grants relate to research that was funded by the DECC Entrepreneurs Fund and by Innovate UK.

   29   Capital management 

In managing its capital structure, the Group's objective is to safeguard the Group's ability to continue as a going concern, managing cash flows so that it can continue to provide returns for shareholders.

The Group makes adjustments to its capital structure in the light of changes in economic conditions and the requirements of the Group's businesses. The Board has sought to maintain low levels of borrowing to reflect the development stage of the Group's businesses.

Over time as the Group's businesses mature and become profitable the Board is likely to make increased use of borrowing facilities to fund working capital.

In order to maintain or adjust the capital structure, the Group may issue new shares or seek additional borrowing facilities. The Group monitors capital on several bases including the debt to equity ratio. This ratio is calculated as debt ÷ equity. Debt is calculated as total borrowings as shown in the consolidated statement of financial position.

Equity comprises all components of equity as shown in the consolidated statement of financial position. The debt-to-equity ratio at 31 December 2018 and 31 December 2017 was as follows:

 
 Group                       2018       2017 
                          GBP'000    GBP'000 
----------------------  ---------  --------- 
 Total debt                     -        732 
 Total equity             (1,140)        741 
 Debt-to-equity ratio       00.0%      98.8% 
----------------------  ---------  --------- 
 
   30     Reserves 

The following reserves describe the nature and purpose of each reserve within equity:

   a.       Capital reduction reserve 

The capital reduction reserve set out in the Consolidated Statement of Changes in Equity arose in 2014 when the nominal value of each share was reduced from 10p to 1p.

   b.       Share premium 

The amount subscribed for each share in excess of nominal value.

   c.       Share option 

The accumulated expense arising during their vesting period of share options granted to directors and employees.

   d.       Accumulated losses 

All other net losses and gains not recognised elsewhere.

Notes to the financial statements for the year ended 31 December 2018

   31   Subsequent events 
   a)       Fundraising 

On 17 January 2019 the Group announced that it had raised gross proceeds of GBP100,000 via the placing of 500,000,000 new ordinary shares of 0.01p each with new and existing investors at a price of 0.02p per share. In addition, a total of 120,000,000 new ordinary shares were issued to two former directors at 0.02p per share, raising gross proceeds of GBP24,000-(James McKenzie 60,000,000 shares and Jonathan Freeman 60,000,000 shares).

On 4 February 2019 the Company raised GBP175,000 through the issue of 1,750,000,000 new ordinary shares of 0.01p each at a price of 0.01p per share.

On 12 March 2019 the Company raised GBP170,000 through the issue of 1,700,000,000 new ordinary shares of 0.01p each at a price of 0.01p per share.

On 22 May 2019 the Group announced the results of the Open Offer that was announced on 1 May 2019. The Group raised GBP666,527 before costs and issued on 24 May 2019 5,332,221,134 new ordinary shares of 0.01p each for a consideration of 0.0125p per share. As outlined in the general meeting of the Company published on 13 March 2019, Peterhouse Capital Limited has been issued with warrants to subscribe for new ordinary shares equal to 3% of the Enlarged Share Capital of the Company from time to time, exercisable at 0.01p per share for up to 3 years from date of issue. The issue of warrants was conditional on the closing of the Company's operating business, the Company becoming a Aim Rule 15 cash shell and a change in the Company's name, proposals which were approved by shareholders on 3 April 2019 and are issued in consideration of fees owed relating to advisory and fund-raising services rendered to the Company during the last quarter of 2018 and first quarter of 2019 and which have been largely not paid for in an effort to conserve the cash available to the Company.

On 24 May 2019 the Group announced that it had raised gross proceeds of GBP218,000 via the placing of 1,744,000,000 new ordinary shares of 0.01p each at a price of 0.0125p per share. The shares were issued on the following dates: 24 May 2019: 247,917,622 shares and 31 May 2019: 1,496,082,378 shares. Following the issue of these shares there were a total of 12,408,442,268 new ordinary shares in issue.

   b)       Other 

In April 2019 a General Meeting approved the closure of Photonstar Technology Limited. The group then became an AIM quoted cash shell. In June 2019 Photonstar Technology Limited was sold for GBP1 to a related party in accordance with the resolution passed at the General Meeting in May 2019. As a result of this sale there are no further liabilities for the Group in respect of this subsidiary beyond the run-down and closure costs already provided for in these 2018 financial statements. Also, as a result of this sale the group's un-provided deferred tax asset arising on taxable losses (Note 16) will reduce from GBP8.5m to GBP0.7m.

   32   Impairment review 

As a result of the Group announcing in January 2019 the orderly wind down of its only remaining business and the Company becoming an AIM Rule 15 cash shell on 5 April 2019, all of the Group's tangible, intangible assets and stock and other miscellaneous items have been fully written down. The impairment loss arising during the year ended 31 December 2018 is as follows:

 
 Group                                                         2018        2017 
                                                            GBP'000     GBP'000 
                                                                       Restated 
---------------------------------------------------------  --------  ---------- 
 Tangible and intangible assets, stock and miscellaneous 
  items                                                         501         748 
---------------------------------------------------------  --------  ---------- 
 Total impairment loss                                          501         748 
---------------------------------------------------------  --------  ---------- 
 

The comparative results have been adjusted to reflect the continuing operations of the Group.

Notes to the financial statements for the year ended 31 December 2018

   33   Notes supporting statement of cash flows 
 
 Group                            Current 
                               Borrowings 
                                (Note 15) 
                                  GBP'000 
---------------------------  ------------ 
 At 1 January 2017                    831 
 Cash flows                          (23) 
 Interest accruing in year             25 
---------------------------  ------------ 
 At 31 December 2017                  833 
 Cash flows                         (860) 
 Interest accruing in year             27 
---------------------------  ------------ 
 At 31 December 2018                    - 
---------------------------  ------------ 
 

Cash and cash equivalents for purposes of the statement of cash flows comprises:

 
                              Group    Company      Group    Company 
                               2018       2018       2017       2017 
                            GBP'000    GBP'000    GBP'000    GBP'000 
------------------------  ---------  ---------  ---------  --------- 
 Cash at bank available 
  on demand                       4          2         44          3 
------------------------  ---------  ---------  ---------  --------- 
 Cash in hand                     -          -          -          - 
------------------------  ---------  ---------  ---------  --------- 
                                  4          2         44          3 
------------------------  ---------  ---------  ---------  --------- 
 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.

END

FR EASKKAASNEFF

(END) Dow Jones Newswires

June 26, 2019 12:00 ET (16:00 GMT)

1 Year Bould Opportunities Chart

1 Year Bould Opportunities Chart

1 Month Bould Opportunities Chart

1 Month Bould Opportunities Chart
Your Recent History
LSE
BOU
Bould Oppo..
Register now to watch these stocks streaming on the ADVFN Monitor.

Monitor lets you view up to 110 of your favourite stocks at once and is completely free to use.

By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions

P: V:gb D:20200219 10:13:45