ADVFN Logo

We could not find any results for:
Make sure your spelling is correct or try broadening your search.

Trending Now

Toplists

It looks like you aren't logged in.
Click the button below to log in and view your recent history.

Hot Features

Registration Strip Icon for default Register for Free to get streaming real-time quotes, interactive charts, live options flow, and more.

CHAL Cindrigo Holdings Limited

0.13
0.00 (0.00%)
28 Mar 2024 - Closed
Delayed by 15 minutes
Share Name Share Symbol Market Type Share ISIN Share Description
Cindrigo Holdings Limited LSE:CHAL London Ordinary Share Ordinary Shares
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  0.00 0.00% 0.13 0.00 00:00:00
Industry Sector Turnover Profit EPS - Basic PE Ratio Market Cap
0 0 N/A 0

Challenger Acquisitions Limited Interim Results (9976R)

27/09/2017 2:30pm

UK Regulatory


Cindrigo (LSE:CHAL)
Historical Stock Chart


From Mar 2019 to Mar 2024

Click Here for more Cindrigo Charts.

TIDMCHAL

RNS Number : 9976R

Challenger Acquisitions Limited

27 September 2017

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, WITHIN, INTO OR IN THE UNITED STATES, AUSTRALIA, CANADA OR JAPAN.

For Immediate Release

27 September 2017

Challenger Acquisitions Limited

("Challenger" or the "Company")

Interim Results

Challenger Acquisitions Limited (LSE: CHAL), a leader in the Giant Observation Wheel industry, is pleased to announce its interim results for the period ended 30 June 2017.

Interim Management Report

As stated in our final results, 2016 was a difficult year due to the inability of Starneth, our previously held wholly owned subsidiary, to close any Giant Observation Wheel projects. Consequently, the requirement to restructure Challenger was one of the primary objectives in 2017. The following is a list of significant changes for the first six months of this year and to the date of this report:

Disposition of Starneth:

The sale of Starneth, announced on 30 January 2017, provided for three key elements: contingent consideration for Challenger, an on-going cooperation agreement, and the extinguishment of all cash obligations owing by Challenger related to Starneth.

The Starneth sale agreement stipulated that Challenger would receive certain payments upon the closing of at least two major development projects by Starneth prior to January 2019, including the Giant Observation Wheel project in Jakarta. Challenger could receive up to US$6 million in fees less a payment of EUR1.25 million related to the cash payment that Challenger was due to pay to the former Starneth vendors from the original acquisition. One common equity unit of New York Wheel LLC will continue to be pledged to the former Starneth vendors until this payment of EUR1.25 million has been completed. Following the sale of Starneth, Challenger will retain its equity stake in the New York Wheel LLC, with a minimum of two equity units and up to three equity units depending on the closure of at least one project by Starneth prior to January 2019.

The cash fees of up to US$6 million that Challenger could receive are based on two fee agreements signed with the new owners of Starneth and are calculated based on the incoming cash receipts from the developers for these projects. The cash payment of EUR1.25 million from Challenger is completely contingent on these projects commencing and paid only once Challenger starts receiving these cash fees.

Challenger and the new Starneth owners have signed a five-year cooperation agreement whereby Starneth can provide the design and engineering for select Giant Observation Wheel projects and Challenger can provide potential funding options for the developers of these select projects.

To date no projects have closed and no fees have been generated.

Board changes:

Primarily due to the lack of progress with Giant Observation Wheel contracts, three directors retired from the board and one new director was added. John Le Poidevin retired in January, Markus Kameisis retired in February (he remains as the Chief Financial Officer and Secretary), and Gert Rieder retired in March. Gene Stice was appointed as a non-executive director in March.

Convertible note changes:

After extensive discussions and negotiations, all of the convertible notes that were scheduled to mature in 2017 were restructured on three major points. The maturity date was extended for another 12 months into 2018, interest that was paid in the past at each quarter end is now paid at the time of the actual conversion of the note into ordinary shares, and the fixed conversion price on the note that is scheduled to mature on 2 March 2018 was reduced to 12p. All other terms for the convertible notes were left substantially unchanged. No additional fees were paid for this restructuring process.

During the six month reporting period and post period end, a significant number of shares were issued as a result of conversions of these convertible notes into ordinary shares and related accumulated interest on these notes; January - 980,657 shares, February - 8,339,012 shares, March - 8,697,927 shares, May - 2,054,683 and 16,457,816 shares, July - 7,257,395 shares, August - 16,556,310, 44,306,596 and 37,671,142 shares.

New funding facilities:

On 13 June 2017, a new GBP1 million unsecured convertible note facility due 8 June 2019 was announced. This facility will be used for general working capital purposes and to potentially support an acquisition or development of a project. To date GBP350,000 has been received from this facility: GBP100,000 in June and GBP250,000 in August.

On 18 May 2017 GBP30,000 was also received from the CEO of Challenger for an unsecured convertible note. This note was fully converted at 3p in July.

New York Wheel Project:

Due to a contractual dispute with the wheel erectors, led by the Dutch company Mammoet, New York Wheel has terminated their contract and is in advanced negotiations with American Bridge Company, a very experienced engineering and construction firm that completed the Giant Observation Wheel in Las Vegas in 2014 (see www.americanbridge.net). This has caused a pause in those specific activities as the companies transition. Work continues on the main terminal building and the major components such as the rim, cables, spindle, drive towers, capsules and control cabinets. For more information see www.newyorkwheel.com, which includes a live webcam of the construction site.

Financial and Corporate Overview

During the six month period we raised GBP130,000 of funding through the issuance of new unsecured convertible notes and GBP250,000 of new unsecured convertible notes was received post period end. This has enabled the Company to continue operating this year. Cost control measures have been implemented throughout the Company, including a reduction of the CEO's compensation to GBP1,000 per month effective 1 February 2017.

The half year results report a loss of GBP560k, comprised of personnel costs of GBP53k, administrative expenses of GBP175k and non-cash finance costs of GBP332k. This result is driven by costs for the ongoing management of Challenger, for the sourcing of funding of Challenger, restructuring of the convertible notes, the corresponding interest on these convertible notes and the public company costs in dealing with its shareholders and other stakeholders.

The corporate activities to date include the Starneth disposition, restructuring of the convertible notes, implementation of cost reduction measures, board changes, securing new funding and actively communicating with creditors, noteholders and shareholders.

Outlook

Looking forward we expect to see continued progress on the New York Wheel Project for the balance of this year and into 2018. Alongside this, we are continuing to seek out, evaluate and review a number of potential projects and developments, which we believe may offer strategic growth opportunities for our Company. This is an ongoing and time consuming process however we are committed to finding a prospective development opportunity for our shareholders.

I would like to take this opportunity to thank our loyal stakeholders and the Board for their continued support.

We look forward to providing further updates in due course.

Mark Gustafson

Chief Executive Officer

27 September 2017

Condensed Consolidated Statement of Comprehensive Income

The condensed consolidated statement of comprehensive income of the Group for the six month period from 1 January 2017 to 30 June 2017 is set out below.

 
 
                                 Period ended    Period ended 
                                      30 June         30 June 
                                         2017            2016 
                                 (unaudited)*     (unaudited) 
                        Note          GBP'000         GBP'000 
 Revenue                 4                  -           2,029 
 Cost of sales                              -         (1,553) 
                              ---------------  -------------- 
 Gross profit                               -             476 
 
 Personnel 
  expenses                               (53)           (498) 
 Administrative 
  expenses                              (175)           (966) 
                              ---------------  -------------- 
 Operating 
  loss on ordinary 
  activities 
  before taxation                       (228)           (988) 
 
 Finance costs                          (332)           (521) 
                              ---------------  -------------- 
 Loss before 
  income taxes                          (560)         (1,509) 
 
 Income tax                                 -               - 
  expense 
                              ---------------  -------------- 
 Loss after 
  taxation                              (560)         (1,509) 
 
 Loss for the 
  period                                (560)         (1,509) 
 Fair value 
  movement on 
  available 
  for sale financial 
  asset                                 (172)            (20) 
                              ---------------  -------------- 
 Total comprehensive 
  loss attributable 
  to owners 
  of the parent                         (732)         (1,529) 
                              ---------------  -------------- 
 
 Loss per share: 
 Basic & diluted         8             (0.01)          (0.11) 
 

*After the disposal of the Starneth group of entities

Condensed Consolidated Statement of Financial Position

The condensed consolidated statement of financial position as at 30 June 2017 is set out below:

 
                                             As at 30    As at 31 
                                                 June    December 
                                                 2017        2016 
                                            unaudited     audited 
                                    Note      GBP'000     GBP'000 
 Assets 
 Current assets 
 Cash and cash equivalents                         36          71 
 Trade and other receivables                        5          17 
                                          -----------  ---------- 
 Total current assets                              41          88 
                                          ----------- 
 Assets of disposal group 
  classified as held for sale        13             -       2,271 
 Non-current assets 
 Property, plant and equipment                      -           - 
 Intangible assets                                  -           - 
 Available-for-sale financial 
  assets                             6          2,311       2,438 
                                          -----------  ---------- 
 Total non-current assets                       2,311       2,438 
 
 Total assets                                   2,352       4,797 
                                          ===========  ========== 
 Equity and liabilities 
 Capital and reserves 
 Share capital                       5            584         219 
 Share premium                                  5,597       4,364 
 Shares to be issued                                -         775 
 Translation reserve                                -       (146) 
 Equity component of convertible 
  instruments                                   1,064       1,064 
 Available for Sale reserve                       290         462 
 Accumulated deficit                          (9,419)     (9,488) 
 Total equity attributable 
  to equity holders                           (1,884)     (2,750) 
 
 Current liabilities 
 Borrowings                          7          2,566       3,615 
 Trade and other payables                         652         533 
                                          -----------  ---------- 
 Total current liabilities                      3,218       4,148 
 Liabilities of disposal 
  group classified as held 
  for sale                           13             -       1,228 
 Non-current liabilities 
 Borrowings                          7          1,018       2,171 
                                          -----------  ---------- 
 Total non-current liabilities                  1,018       2,171 
                                          ===========  ========== 
 Total equity and liabilities                   2,352       4,797 
 

Condensed Consolidated Statement of Changes in Equity

The unaudited condensed consolidated statement of changes in equity of the Group for the period from 1 January 2016 to 30 June 2016 is set out below:

 
                                                                    Equity component  Available 
                         Share     Share   Shares to  Trans-lation    of convertible   for sale   Retained 
                       capital   Premium   be issued       reserve       instruments    reserve   earnings    Total 
                       GBP'000   GBP'000     GBP'000       GBP'000           GBP'000    GBP'000    GBP'000  GBP'000 
On 1 January 
 2016                      133     2,080       1,650           (3)                 -          -    (2,592)  (1,268) 
 
Loss for 
 the period                  -         -           -             -                 -          -    (1,509)  (1,509) 
Other comprehensive 
 loss                        -         -           -          (20)                 -          -          -     (20) 
                      --------  --------  ----------  ------------  ----------------  ---------  ---------  ------- 
Total comprehensive 
 loss for 
 the period                  -         -           -          (20)                 -          -    (1,509)  (1,529) 
                      --------  --------  ----------  ------------  ----------------  ---------  ---------  ------- 
 
Transaction 
 with owners 
Issue of 
 shares                     16       428           -             -                 -          -          -      444 
Issue of 
 options                     -         -           -             -                 -          -          5        5 
Equity component 
 convertible 
 notes                       -         -           -             -               569          -          -      570 
                      --------  --------  ----------  ------------  ----------------  ---------  ---------  ------- 
Total                       16       428           -             -               569          -          5    1,018 
 
As at 30 
 June 2016                 149     2,508       1,650          (23)               569          -    (4,096)      756 
                      --------  --------  ----------  ------------  ----------------  ---------  ---------  ------- 
 

The unaudited condensed consolidated statement of changes in equity of the Group from 1 January 2017 to 30 June 2017 is set out below:

 
                                                                               Equity 
                                                                            component  Available 
                         Share     Share         Shares  Translation   of convertible   for sale   Retained 
                       capital   Premium   to be issued      reserve      instruments    reserve   earnings    Total 
                       GBP'000   GBP'000        GBP'000      GBP'000          GBP'000    GBP'000    GBP'000  GBP'000 
On 1 January 
 2017                      219     4,364            775        (146)            1,064        462    (9,488)  (2,750) 
 
Loss for 
 the period                  -         -                                                              (560)    (560) 
Other comprehensive 
 loss                        -         -                                                   (172)               (172) 
                      --------  --------  -------------  -----------  ---------------  ---------  ---------  ------- 
Total comprehensive 
 loss for 
 the period                  -         -                                                   (172)      (560)    (732) 
                      --------  --------  -------------  -----------  ---------------  ---------  ---------  ------- 
 
Transaction 
 with owners 
Issue of 
 shares                    365     1,233              -            -                -          -          -    1,598 
Cancellation 
 of unissued 
 shares                      -         -          (775)            -                -          -        775        - 
Disposal 
 of disposal 
 unit                        -         -              -          146                -          -      (146)        - 
Equity 
 component 
 convertible 
 notes                       -         -              -            -                -          -          -        - 
                      --------  --------  -------------  -----------  ---------------  ---------  ---------  ------- 
Total                      365     1,233          (775)          146                -          -        629    1,598 
 
As at 30 
 June 2017*                584     5,597              -            -            1,064        290    (9,419)  (1,884) 
                      --------  --------  -------------  -----------  ---------------  ---------  ---------  ------- 
 

*After the disposal of the Starneth group of entities

Share capital comprises the Common Shares issued by the Company.

Accumulated deficit represents the aggregate retained losses of the Company since incorporation.

Other reserves represent the shares to be issued, the share options reserve as well as gains and losses on translation of foreign subsidiaries.

Condensed Consolidated Statement of Cash Flows

The condensed consolidated cash flow statement of the Group from 1 January 2016 to 30 June 2017 is set out below:

 
                                          Period ended   Period ended 
                                               30 June        30 June 
                                                  2017           2016 
                                            Unaudited*      Unaudited 
                                               GBP'000        GBP'000 
 Net cash used in operating activities 
 Loss for the period before taxation             (560)        (1,509) 
 Depreciation and amortisation                       -             39 
 Share option charge                                 -              5 
 Finance Cost                                      379            521 
 Operating cash flows before movements 
  in working capital                             (181)          (944) 
 Increase in receivables                            12          (508) 
 Increase in accounts payable 
  and accrued liabilities                          119             88 
                                         -------------  ------------- 
 Net cash used in operating activities            (50)        (1,364) 
 
 Investment in property, plant 
  and equipment                                      -           (16) 
 Investment in available for sale 
  financial asset                                    -          (805) 
 Net cash outflow from investing 
  activities                                         -          (821) 
 
 Issue of ordinary shares net                        -              - 
  of issue costs 
 Issue of convertible instruments                  125          2,402 
 Finance Expenses                                (110)          (108) 
 Net cash inflow from financing 
  activities                                        15          2,294 
 
 Net (decrease)/increase in cash 
  and cash equivalents                            (35)            109 
                                         =============  ============= 
 
 Cash and cash equivalent at beginning 
  of period                                         71            325 
 Cash and cash equivalent at end 
  of period                                         36            434 
                                         =============  ============= 
 

Notes to the Condensed Consolidated Interim Report

   1.     General information 

The Company was incorporated under section II of the Companies (Guernsey) Law 2008 on 24 November 2014, it is limited by shares and has registration number 59383.

The Company has an investment of US$3m in New York Wheel Investor LLC, a company that was set up to fund the equity component for the project to build a New York Wheel which includes an approximate 630 foot high observation wheel with 36 capsules, a 68,000 square foot terminal and retail building, and a 950 space parking garage.

The comparatives given relate to period ended 30 June 2016 for all Profit and Loss related items and to the annual report for the period ended 31 December 2016 for all Balance Sheet related items. The comparatives relating to the period ended 30 June 2016 are before the disposal of the Starneth group of entities.

The Company's registered office is located at 1 Le Marchant Street, St. Peter Port, Guernsey GY1 4HP, Channel Islands.

The company has not prepared individual financial statements in accordance with section 244 of the Companies (Guernsey) Law 2008.

   2.    BASIS OF PREPARATION 

The interim condensed unaudited financial statements for the period ended 30 June 2017 have been prepared in accordance with IAS 34 Interim Financial Reporting. They do not include all the information required for a complete set of IFRS financial statements. However, selected explanatory notes are included to explain events and transactions that are significant to an understanding of the changes in the group's financial position and performance since the last annual consolidated financial statements as at the year ended 31 December 2016. The results for the period ended 30 June 2017 are unaudited.

The condensed unaudited consolidated financial statements for the period ended 30 June 2016 have adopted accounting policies consistent with those followed in the preparation of the Group's annual consolidated financial statements for the year ended 31 December 2016.

   3.    CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS 

The preparation of financial statements requires the use of accounting estimates which, by definition, will seldom equal the actual results. Management also needs to exercise judgement in applying the group's accounting policies.

This note provides an overview of the areas that involved a higher degree of judgement or complexity, and of items which are more likely to be materially adjusted due to estimates and assumptions turning out to be wrong. Detailed information about each of these estimates and judgements is included together with information about the basis of calculation for each affected line item in the financial statements.

Significant estimates and judgements

The areas involving significant estimates or judgements are:

   --           Going concern 

At 30 June 2017 the group had net current liabilities of GBP3,177k. The Interim Report has been prepared on the basis that the Group will continue as a going concern. Under the going concern assumption, an entity is ordinarily viewed as continuing in business for the foreseeable future with neither the intention nor the necessity of liquidation, ceasing trading or seeking protection from creditors pursuant to laws or regulations. The assessment has been made based on the Group's economic prospects which have been included in the financial budget for the forthcoming twelve months and for managing their working capital requirements. In assessing whether the going concern assumption is appropriate, management takes into account all available information for the foreseeable future, in particular for the twelve months from the date of approval of the financial statements. Should the company be unable to continue trading, adjustments would have to be made to reduce the value of the assets to their reasonable amounts, to provide for further liabilities which might arise, and to classify fixed assets as current.

The Group finances its current working capital through the issue of convertible loan notes. The directors are confident that they will be able to raise the required funds and/or manage the level of expenditure for the foreseeable future.

Based on the above, the directors have formed a judgement that the going concern basis should be adopted in preparing the financial statements.

Estimates and judgements are continually evaluated. They are based on historical experience and other factors, including expectations of future events that may have a financial impact on the entity and that are believed to be reasonable under the circumstances.

   4.    BUSINESS SEGMENTS 

For the purpose of IFRS8, the Chief Operating Decision Maker "CODM" takes the form of the board of directors. The Directors are of the opinion that after the sale of the Starneth entities the business of the Company comprised a single activity, being the identification and acquisition of target companies or businesses in the entertainment sector.

   5.    SHARE CAPITAL 
 
 Issued and fully           Number       Share      Share      Total 
  paid                       of shares    capital    premium 
                                         GBP'000    GBP'000    GBP'000 
 
 Issued on incorporation    1            -          -          - 
 Issue of shares            9,365,581    133        2,080      2,213 
 Sub division of            3,960,099    -          -          - 
  shares 
 At 31 December 
  2015                      13,325,681   133        2,080      2,213 
                           -----------  ---------  ---------  -------- 
 
 Issue of shares            1,552,087    16         428        444 
                           -----------  ---------  ---------  -------- 
 
 At 30 June 2016            14,877,768   149        2,508      2,657 
                           -----------  ---------  ---------  -------- 
 
 Issue of shares            7,021,308    70         1,856      1,926 
                           -----------  ---------  ---------  -------- 
 
 At 31 December 
  2016                      21,899,076   219        4,364      4,583 
                           -----------  ---------  ---------  -------- 
 
 Issue of shares            36,530,095   365        1,233      1,598 
                           -----------  ---------  ---------  -------- 
 
 At 30 June 2017            58,429,171   584        5,597      6,181 
                           -----------  ---------  ---------  -------- 
 

On 24 November 2014, the Company was incorporated and had an issued share capital of one Ordinary Share of GBP1.00.

On 5 December 2014, a further 40,000 Ordinary Shares of GBP1 each were issued to the Founder for a consideration of GBP320,000.

On 10 December 2014, the existing 40,001 Founder Shares were sub-divided into 4,000,100 Ordinary Shares of GBP0.01 each.

On 19 February 2015, on Admission to the Main Market of the London Stock Exchange, a further 7,000,000 Ordinary Shares were issued for a consideration of GBP700,000.

On 3 July 2015, 109,789 shares were issued at GBP 0.37 as consideration for interests from the Convertible Note 2016 and 240,000 shares at GBP 0.40 were issued to the introducer of the New York Wheel investment.

On 15 July 2015, as part of the consideration paid for acquiring the Starneth business 1,100,000 shares were issued at a price of GBP 0.75/each.

On 28 July 2015, 630,000 shares were issued at GBP 0.40 to the introducer of the Starneth acquisition.

On 6 October 2015, 235,792 shares were issued as consideration for interests from the Convertible Note 2016.

On 16 October 2015, 10,000 shares were issued upon the exercise of employee options at GBP 0.40 per share.

On 7 January 2016, 230,034 shares were issued as consideration for interests on the Convertible Notes outstanding.

On 21 March 2016, 711,646 shares have been issued for the conversion of convertible notes into shares. 694,610 shares have been for the conversion of GBP 172,200 and 17,036 shares have been for the accrued interest until the conversion date.

On 13 April 2016, 277,061 shares were issued as consideration for interests on the Convertible Notes outstanding. On the same day 332,792 shares were issued for the conversion of GBP 83,198 loan notes into shares. For the accrued interest of GBP 138.08 on the conversion amount 554 shares were issued.

On 18 July 2016, 2,024,421 shares were issued. Of these, 463,597 shares were issued in relation to interest on Convertible Notes up to 30 June 2016, 460,824 shares were issued in respect of the conversion of GBP 81,243 of the 12% Convertible Notes due 2017 and 1,100,000 shares were issued in relation to the second tranche of Consideration shares.

On 15 September 2016, 4,276,262 shares were issued as conversion of GBP 750,128 of the 12% Convertible Notes due 2017 and GBP 11,046.52 to settle the interest accrued interest up until the date of conversion.

On 17 October 2016, 529,952 shares were issued as consideration for interests on the Convertible Notes outstanding up to 30 September 2016.

On 22 December 2016, 190,673 shares were issued. Of these 124,673 shares were issued in relation to a conversion of GBP 15,918 of the 0% Convertible Notes due April 2018, 66,000 shares were issued in relation to the third tranche of Consideration Shares. It was anticipated that the sale of Starneth was to be completed prior to 31 December 2016 and the 66,000 shares were issued in full and final settlement of the third tranche of share consideration payable to one of the vendors. The remaining balance was forgiven as part of the sale of Starneth after the year end.

On 6 January 2017, 188,501 new ordinary have been issued on the conversion of GBP20,000 of the unsecured convertible note due 13 April 2018. A further 792,156 new ordinary shares have been issued to the holders of convertible notes a payment of interest due for the quarter ended 31 December 2016.

On 6 February 2017, 8,323,476 new ordinary shares were issued. Of these 7,688,185 shares were issued for the conversion of GBP630,431 of the 12% unsecured convertible notes due 6 May 2017 and 635,291 shares were issued for the conversion of GBP50,000 of the unsecured convertible notes due 13 April 2018. Additionally 15,536 new ordinary shares were issued to settle interest of GBP1,274 due up until the date of conversion.

On 30 March 2017, 6,622,963 new ordinary shares have been issued upon conversion of GBP213,400 of the unsecured convertible notes due 6 May 2017. Further 1,206,329 new ordinary shares have been issued upon conversion of GBP40,453 of the unsecured convertible notes due 13 April 2018. In addition 868,635 new ordinary shares have been issued to settle interest due up until the date of conversion of GBP27,818.

On 4 May 2017, 1,991,839 new ordinary shares were issued upon the conversion of GBP72,487 of the unsecured convertible note due 13 April 2018. Further 62,844 new ordinary shares have been allotted to the holder of the convertible note 2019 in payment of interest due for the quarter ended 31 March 2017.

On 25 May 2017, 2,089,995 new ordinary shares have been allotted on the conversion of GBP60,242 of the unsecured convertible note due 13 April 2018. Further 10,429,629 new ordinary shares have been allotted to the holders of the unsecured convertible note due 6 May 2018 on the conversion of GBP281,600. Additionally 255,608 new ordinary shares were allotted as interest on this note upon until the date of conversion. Further 3,571,429 new ordinary shares were issued upon the conversion of GBP100,000 of the unsecured convertible note due 22 April 2018. Additional 111,155 have been issued as interest on this note up until the date of conversion.

On 30 June 2017, the number of Ordinary Shares authorised for issue was unlimited. All Ordinary Shares have equal voting rights and rank equally on a winding up.

   6.    AVAILABLE-FOR-SALE FINANCIAL ASSETS 
 
 
 
                                   Available 
                                   for sale 
                                   financial 
                                   asset 
                                 GBP'000 
 Cost 
 At 31 December 2015                   1,976 
                                ------------ 
 
 Additions                               805 
 At 30 June 2016                       2,781 
                                ------------ 
 
 Disposal                              (805) 
 Foreign exchange difference             462 
                                ------------ 
 At 31 December 2016                   2,438 
                                ------------ 
 
 Additions                                 - 
 Foreign exchange difference           (127) 
 At 30 June 2017                       2,311 
 

On 20 May 2015, the Company invested a total of GBP1,976,400 (US$3,000,000) in New York Wheel Investor LLC. This company was setup to fund the equity component for the New York Wheel project, which includes an approximate 630 foot high observation wheel with 36 capsules, a 68,000 square foot terminal and retail building and a 950 space parking garage. In order to acquire its interest, the Company became a party to the Amended and Restated Operating Agreement of New York Wheel Investor LLC, dated May 20, 2015. Under that agreement, the Company can be called upon to make further capital contributions to the project should there be a cash shortfall, or face potential dilution of its interest should it choose not to invest further cash sums.

   7.    BORROWINGS 
 
                                30 June   30 June 
                                 2017      2016 
 Current                        GBP'000   GBP'000 
-----------------------------  --------  -------- 
 Convertible notes              1,414     2,832 
 Deferred cash consideration    1,152     1,029 
 Borrowings                     -         382 
                                2,566     4,243 
 Non-current 
-----------------------------  --------  -------- 
 Convertible notes              1,018     1,817 
 Deferred cash consideration    -         919 
-----------------------------  --------  -------- 
                                1,018     2,736 
 

Between 6 May 2015 and 30 July 2015, the Company issued GBP3,067,200 of convertible notes. The notes are unlisted, unsecured, transferable and convertible with a twelve month maturity date. Interest is accrued at 12% per annum and payable quarterly, or upon conversion, in cash or in Ordinary Shares at the Company's discretion. The notes can be converted into Ordinary Shares at a price per Ordinary Share equal to the lower of GBP0.50 and 7.5% discount to the prevailing market price, defined as the average of the lowest three volume weighted average prices as quoted by Bloomberg for the period of 10 trading days prior to the conversion date. Provided that if the volume weighted average price is at any time less than GBP0.25 for three consecutive trading days, then the noteholder is unable to convert for a period of 30 calendar days, without the consent of the Company. The requirement of consent applies only on the first such occasion. The maximum amount of notes that may be converted in any 30-day period by a noteholder is 10% of the total amount of any notes subscribed by that noteholder. The Company can redeem the notes at a 10% premium anytime the market price is lower than GBP0.50. On 26 April 2016 the Noteholders agreed to an extension of the Convertible Note for 12 month. On 10 May 2017 the Company announced that the three remaining holders of the note have agreed to extent the date of maturity to 6 May 2018 and to receive interest upon conversion of the note or on the maturity date.

On 15 July 2015 the company acquired the Starneth Group. Part of the purchase price was two deferred cash payments. The payments are in equal amounts of EUR 1,250,000 and payable at the first and second anniversary of the transaction. Accordingly these were recorded under current and non-current liabilities respectively. Based on the convertible notes issued in 2015, an interest rate of 12% was used to discount the tranches for the initial recognition. The carrying value of the amounts at 31 December 2016 in the transaction were GBP1,064k for the first tranche and GBP1,043k for the second tranche. Interest expenses recorded on both tranches in 2016 was GBP163k (2015:GBP 86k). As part of the disposal of the Starneth participation as announced on 30 January 2017, the terms of these payments were changed as follows: the second tranche was waived as part of the sale agreement and the first tranche is only payable on the payment of success fees by Starneth to Challenger, if success fees become payable then the first tranche of fees will be deducted from success fees due. The company has not recognised an asset in this regard due to the uncertainty over whether the success fees will become due. The current amount of the liability amounts to GBP 1,152k. One common unit in New York Wheel Investor LLC has been pledged as part of the disposition agreement.

On 29 January 2016, the Company issued a further GBP1 million of secured convertible notes. The notes are unlisted, secured, transferable and convertible. Maturity date is 30 June 2019. The Secured Convertible Notes are secured by one common unit of New York Wheel Investor LLC, representing a total value US$1 million. Interest is accrued at 8% per annum and payable quarterly. One eighth of the interest can be settled in cash or shares at the Company's discretion. Seven eighths of the interest is settled in new convertible notes with the same terms. The notes can be converted into Ordinary Shares at a fixed conversion price of GBP0.80 per Ordinary Share. The Company can redeem the notes at a 10% premium anytime. As per the nature of this convertible instrument, GBP106k has been recognised as an equity component in the reserves, using a discount rate of 12%.

On 2 March 2016 the Company issued another convertible note for GBP0.5 million. The notes are unlisted, secured, transferable and convertible. Maturity date is 2 March 2017. The Company can redeem the notes in cash or shares at 25p at Maturity at the Company's discretion. The Secured Convertible Notes are secured by one common unit of New York Wheel Investor LLC, representing a total value US$1 million. Interest is accrued at 5% per annum and payable quarterly or at Maturity at the Company's discretion. The interest can be paid in cash or shares, at the average of the 10 day closing price prior to the end of each calendar quarter, at the Company's discretion. The Company can redeem the notes at a 25% premium anytime. On 28 March 2017 the Company announced that the convertible note was amended and restated. The maturity date is now on 2 March 2018, the fixed conversion price is now 12p, any accrued interest will be paid upon conversion and the Company can at any time redeem in cash all or any part of the outstanding note at 30% premium to the principal amount.

On 24 April 2016 the Company issued another convertible note for GBP0.5 million. The notes are unlisted, unsecured, transferable and convertible. Maturity date is 22 April 2018. Interest is accrued at 8% per annum and payable quarterly. The interest can be paid in cash or shares, at the average of the 10 day closing price prior to the end of each calendar quarter, at the Company's discretion. The notes can be converted into Ordinary Shares at the lower of GBP0.25 or the lowest volume weighted average price over the 10 days prior to the conversion. The Company can redeem the notes at a 25% premium anytime. As per the nature of this convertible instrument, GBP463k has been recognised as an equity component in the reserves, using a discount rate of 12%. On 8 May 2017 the Company announced that interest on this convertible note is received by the investor on conversion or on the maturity date.

On 10 June 2016 the Company issued another convertible note with for GBP0.5 million. The notes are unlisted, unsecured, transferable and convertible. Maturity date is 10 June 2018. Interest is accrued at 8% per annum and payable quarterly. The interest can be paid in cash or shares, at the average of the 10 day closing price prior to the end of each calendar quarter, at the Company's discretion. The notes can be converted into Ordinary Shares at the lower of GBP0.25 or the lowest volume weighted average price over the 10 days prior to the conversion. The Company can redeem the notes at a 25% premium anytime. On 8 May 2017 the Company announced that interest on this convertible note is received by the investor on conversion or on the maturity date.

On 18 October 2016 the Company issued another convertible note for GBP0.35 million. The notes are unlisted, unsecured, transferable and convertible. Maturity date is 13 April 2018. Interest is built into the face value of the note at GBP1.15 per GBP 1 of note. The notes can be converted into ordinary shares of the Company for the lower of GBP 0.25 or the lowest weighted average price over the 5 days prior to the conversion. For the first 6 months, the Company can redeem in cash all or any part of the outstanding convertible note at face value, thereafter with a 15% premium to face value. The convertible note must be redeemed by the Company on 13 April 2018 in cash, unless it has been fully converted by then into ordinary shares.

On 18 May 2017 the Company issued another convertible note for GBP30,000. The notes are unlisted, unsecured, transferable and convertible. Maturity date is 17 May 2018. Interest is 5% per annum after an initial 90 day grace period, interest is payable upon conversion or on maturity in cash or in Ordinary Shares at the Company's discretion. The notes can be converted into ordinary shares of the Company at the fix conversion prices of GBP0.03 per ordinary share. The Company can redeem in cash all or any part of the outstanding convertible note with a 20% premium to face value. The convertible note must be redeemed by the Company on 17 May 2018 in cash or in ordinary shares at GBP0.03 per ordinary share, at the Company's discretion.

As part of a new GBP1 million funding facility, on 13 June 2017 the company issued another convertible note for GBP100,000. The notes are unlisted, unsecured, transferable and convertible. Maturity date is 8 June 2019. No conversions can happen in the first 120 days. The maximum amount that can be converted in any 30 day period is 20% of the principle amount. The conversion price is the lowest volume weighted average price over 10 days prior to the conversion. Interest rate is 8% per annum and payable upon conversion at the Company's option in cash or ordinary shares at the conversion price. The Company can redeem in cash all or any part of the outstanding convertible note with a 25% premium to the principal amount.

The convertible notes, where no equity component has been described above, have been recognised as a liability in accordance with IAS 32 - Financial Instruments as the instrument provides an obligation to the company to either settle the liability via a cash payment or via the issue of a variable number of shares. The conversion feature represents an embedded derivative, however this has not been separately recognised as the conversion feature is considered to be closely related to the host contract.

   8.    LOSS PER SHARE 

The calculation for loss per share (basic and diluted) for the relevant period is based on the loss after income tax attributable to equity holder for the period from 31 December 2016 to 30 June 2017 and is as follows:

 
 Loss attributable to equity holders 
  (GBP)                                 (560,000) 
                                       ----------- 
 Weighted average number of shares      37,823,056 
                                       ----------- 
 
 Loss per share basic (GBP)             (0.01) 
                                       ----------- 
 

Basic loss per share is calculated by dividing the loss after tax attributable to the equity holders of the group by the weighted average number of shares in issue during the year.

Diluted loss per share is calculated by adjusting the weighted average number of ordinary shares outstanding to assume conversion of all potential dilutive ordinary shares namely the conversion of the convertible loan note in issue. The effect of these potential dilutive shares would be anti-dilutive and therefore are not included in the above calculation of diluted earnings per share.

   9.    RELATED PARTY TRANSACTIONS 

The unsecured convertible note due 17 May 2018 for GBP30,000 was issued to the Chief Executive Officer of the Company. This note was convertible at 3p and carried a 5% interest rate after a 90 day grace period.

   10.   SUBSEQUENT EVENTS 

On 7 July 2017 the Company issued 1,000,000 new ordinary shares to Mark Gustafson upon conversion of the convertible note due 17 May 2018. Further 6,115,713 new ordinary shares have been allotted to the holders of the unsecured convertible note due 22 April 2018, compromising 5,882,353 shares for the conversion of GBP100,000 of notes and 233,360 for accumulated interest. In addition 141,682 new ordinary shares and 18,493 new convertible notes have been allotted in the relation to the unsecured convertible note due 30 June 2019, for interest for the quarter ended 30 June 2017.

On 2 August 2017 the Company announced that it has allotted 5,510,282 new ordinary shares on the conversion of GBP53,802.39 of the unsecured convertible note due 13 April 2018. In addition the Company allotted 10,555,556 shares on the conversion of GBP95,000 of the unsecured convertible note due 22 April 2018 and 490,472 shares for accumulated interest.

On 15 August 2017 the Company announced that is has allotted 5,952,166 new ordinary shares for the conversion of the remaining GBP73,408.06 of the unsecured convertible note due 13 April 2018. Further the Company has allotted 22,777,778 new ordinary shares on the conversion of the last GBP205,000 of the unsecured convertible note due 22 April 2018 and 1,113,304 shares for accumulated interest. Further 13,463,027 new ordinary shares were issued for the conversion of GBP170,000 of the unsecured convertible note due 6 May 2018 and 1,000,322 shares have been issued for accumulated interest.

On 24 August 2017 the Company announced that is has allotted 35,833,334 new ordinary shares in relation to the conversion of GBP430,000 unsecured convertible notes due 10 June 2018 and a further 1,837,808 shares for accumulated interest.

On 25 August 2017 the Company announced that it has received GBP250,000 of funding through the GBP1 million unsecured convertible note facility due 8 June 2019. The notes are unlisted, unsecured, transferable and convertible. Maturity date is 8 June 2019. No conversions can happen in the first 120 days. The maximum amount that can be converted in any 30 day period is 20% of the principle amount. The conversion price is the lowest volume weighted average price over 10 days prior to the conversion. Interest rate is 8% per annum and payable upon conversion at the Company's option in cash or ordinary shares at the conversion price. The Company can redeem in cash all or any part of the outstanding convertible note with a 25% premium to the principal amount.

   11.      GROUP STRUCTURE 

The group had the following dormant subsidiaries as of 30 June 2017:

 
                                                    Proportion     Portion 
                                                     of ordinary    of ordinary 
                                                     shares         shares 
               Country                               held           held 
                of incorporation                     directly       by the 
                and place           Nature           by parent      group 
 Name           of business          of business     (%)            (%) 
------------  -------------------  --------------  -------------  ------------- 
 Global Eye 
  Holdings 
  Limited      Guernsey             Dormant         100            100 
------------  -------------------  --------------  -------------  ------------- 
 

12. ULTIMATE CONTROLLING PARTY

As at 30 June 2017, no one entity owns greater than 50% of the issued share capital. Therefore the Company does not have an ultimate controlling party.

13. DECONSOLIDATION OF DISPOSAL GROUP

The pre-tax loss recognised on the re-measurement of the disposal group to fair value less costs to sell was GBP3,128k as per 31 December 2016. The fair value less costs to sell reflect the expected proceeds on disposal, which have been determined by the directors to be the waiving of an existing liability to the purchaser for deferred cash consideration for GBP1,043k. Therefore the carrying value of the disposal group equals the expected proceeds at 31 December 2016. Immediately subsequent to the year end the Company lost control of the disposal group after agreement was reached with the purchasers. The date of signing the sale and purchase agreement was 30 January 2017, and the date of the loss of control was 6 January 2017. As the loss of control happened immediately subsequent to the year end, the figures as at year end have been used for the deconsolidation.

This announcement contains inside information.

**ENDS**

For more information visit www.challengeracquisitions.com or enquire to:

 
 Challenger Acquisitions Limited 
 Mark Gustafson                     +1 604 454 8677 
 St Brides Partners Ltd (PR) 
 Lottie Brocklehurst, Charlotte     +44 (0) 20 7236 
  Page                                         1177 
 

This information is provided by RNS

The company news service from the London Stock Exchange

END

IR SELFDWFWSEEU

(END) Dow Jones Newswires

September 27, 2017 09:30 ET (13:30 GMT)

1 Year Cindrigo Chart

1 Year Cindrigo Chart

1 Month Cindrigo Chart

1 Month Cindrigo Chart

Your Recent History

Delayed Upgrade Clock