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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Live Company Group Plc | LSE:LVCG | London | Ordinary Share | GB00BGSGT481 | ORD 1P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 0.30 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From Jul 2019 to Jul 2024
TIDMLVCG
RNS Number : 2341D
Live Company Group PLC
27 June 2021
28 June 2021
LIVE COMPANY GROUP PLC
("LVCG", the "Company" or the "Group")
2020 Full Year Audited Accounts
Live Company Group PLC (AIM: LVCG) is pleased to announce its audited results for the year ended 31 December 2020, extracts from which are set out below - will be made available on the Company's web-site www.livecompanygroup.com shortly.
In light of the UK Government's current restrictions and guidelines in respect of the COVID-19 pandemic, the Company in finalising appropriate arrangements for its 2021 Annual General Meeting details of which will be announced in due course.
Chairman's Review
The year was extremely challenging due to the impact of COVID-19 but ended on a high note with the creation of a new division, Live Company Sports and Entertainment.
BRICKLIVE
In 2020, our business was severely impacted by continued COVID-19 restrictions. In Q1 we announced contracted revenues of GBP3.3 million for 2020 with 32 events already planned and further 50 events budgeted for the year and GBP1.1million contracted revenue for 2021. However, and in line with other businesses in the sector, we took the decision to withdraw forecasts as we entered into the first lockdown in March 2020. Q2 and Q3 were difficult quarters but our customers stuck by us and only one event out of 24 that were scheduled for 2020 was cancelled, the rest being postponed to 2021/2022.
As a consequence of the uncertainty created by COVID-19, particularly in China, we have impaired the value of our investments and associated goodwill in relation to Brick Live Far East Limited and the operations of our joint venture Brick Live CED (Beijing) Company Limited, however I am confident the wider China market will continue to represent a significant opportunity for the Group.
In September 2020, we announced the first contract for Paddington Bear (an IP we signed in Q1 2020) with the White Rose Shopping Centre in Leeds which took place during Christmas 2020.
In November 2020, Bricklive Animal Paradise opened at Naples Zoo in Florida delivering on our strategy of maximising asset utilisation during the Northern Hemisphere winter months by targeting the Southern Hemisphere or sunshine states.
In addition as part of our COVID-19 survival strategy we sold part of our brick stock, which was not needed for current or planned builds, representing 6% of our total stock.
During the year we also saw an increased demand in consumer sets and corporate builds including a bespoke set for a video game producer.
Although the UK is projected to cancel all COVID-19 restrictions in July 2021, the rest of the world, with the exception of the USA and China is unlikely to see business confidence return before Q1 2022.
Trading has remained extremely difficult thus far in 2021 with COVID-19 restrictions limiting the number and size of events and as a result the Group has continued to make losses in the current trading period.
In spite of this, I am pleased to say that we see signs of future business returning and in particular I can note:
-- BRICKLIVE Supersized is currently on show at John Ball Zoo, Michigan USA -- BRICKLIVE Big Cats is currently on show at Alwetter Zoo, Munster, Germany -- BRICKLIVE Animal Paradise went on show in Paisley town centre, Paisley, UK on 26 June 2021
-- BRICKLIVE Fantasy Kingdom goes on show at Wolverhampton Art Gallery, Wolverhampton, UK on 3 July 2021
-- BRICKOSAURS goes on show in Utrecht, Netherlands on 5 July 2021
With more events being confirmed for both 2021 and 2022, we look forward to updating shareholders further during our quarterly operational updates.
LCSE
In December 2020 we announced the creation of a new Sports and Entertainment division - Live Company Sports and Entertainment ('LCSE'). The new division focuses on live sports, entertainment and music events. Several existing multi-year contracts were novated to LCSE from World Sport South Africa PTY Limited. ('WSSA').
Due to the ongoing effects of COVID-19 there have been no events thus far in 2021 but, LCSE has recently announced the rescheduling of The Cape Town Cycle Tour to 10 October 2021 and, in partnership with the City of Cape Town and V&A Waterfront Holdings (Pty) Limited), the dates for the Cape Town stopover of the Global Ocean Race as 20 November 2022 to 6 December 2022.
In addition LCSE will be staging four wine festivals on behalf of Pick n Pay Stores Limited, a major South African retailer, in Q4, dates to be confirmed.
Formula E
Within the LCSE division (E Movement Holdings Ltd; 'EMHL') LVCG acquired the right to sell sponsorship and the management for the upcoming Formula E race in Cape Town planned for the last week of February 2022.
E Movement (Pty) Limited ('EMPL'), the South African based promoter of Formula E, Cape Town, has signed a contract with Formula E Holdings for the rights to promote the Cape Town Formula E race for a 10 year period beginning 2022. This contract is subject to various preconditions being fulfilled.
Start Art Global Limited Investment
Post balance sheet we announced the subscription for a minority interest of 16.3% of issued share capital in Start Art Global Limited ('START Art') with an option to increase to 20% based on an agreed valuation formula within 6 months of completion. START Art is building an online sales platform (with several potential revenue streams including potential for non-fungible tokens ('NFT's).
The START Art platform was launched on 22 June 2021.
Corporate
In June 2020 and December 2020, we raised a total of GBP1m via two separate placings to facilitate the expansion of the BRICKLIVE Zoo programme, the investment into the new Sports and Entertainment division and to provide working capital for the Group. Post balance sheet in May 2021 we raised GBP1.5million (gross) via a placing: GBP1million for the 16.3% investment into START Art and GBP500,000 for working capital for BRICKLIVE and LCSE. This fundraise was subject to shareholder approval and a general meeting took place on 21 May 2021 approving the transaction.
Following the resignation of three Directors in February 2021 and as referred to in the announcement on 4 May 2021 the Company has commenced the search for a new senior independent Director; this appointment will not be by the 30 June but I look forward to announcing the appointment of a new Director shortly. As we said in that announcement, the Company also intends to conduct a full board review with the intention of making further changes during the latter half of 2021.
Cost Savings
As detailed in the Financial Review the Group made annual cost savings in excess of GBP1m. This included the reduction of Executive Chairman's and senior staff compensation from Q2 2020.
Additionally, I delayed the repayment of my loan and converted an additional GBP30,000 in exchange for shares at 5p all other terms remaining the same.
We face a challenging year ahead post COVID-19, though as governments rally around the world to ensure the global economy gets back on its feet and as the vaccination programme gains momentum, we have an opportunity to provide both edutainment to our customers to assist in getting people back out to visit the high streets, shopping centres, zoos and tourist attractions and the opportunity to participate in sports and entertainment events globally.
I would like to personally thank the team for all their efforts and for their ongoing support and energy especially during the lockdown period.
David Ciclitira
Chairman
Results and Dividends
The Group made a loss after taxation of GBP8,233,000 (2019: GBP2,185,000). The Directors do not recommend the payment of a dividend. The following financial statements are extracted from the audited financial statements which were approved by the Board of Directors and authorised for issuance on 25 June 2021.
Auditor's review
We have audited the financial statements of Live Company Group Plc (the 'parent Company' and its subsidiaries (the 'Group')) for the year ended 31 December 2020, which comprise the Consolidated Statement of Comprehensive Income, the Consolidated and Parent Company Statements of Financial Position, the Consolidated and Parent Company Statements of Changes in Equity, the Consolidated and Parent Company Statements of Cash Flows and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and International Financial Reporting Standards (IFRSs) as adopted by the European Union and, as regards the parent Company financial statements, as applied in accordance with the provisions of the Companies Act 2006.
In our opinion:
-- the financial statements give a true and fair view of the state of the Group's and of the parent Company's affairs as at 31 December 2020 and of the Group's loss for the year then ended;
-- the Group financial statements have been properly prepared in accordance with IFRSs as adopted by the European Union;
-- the parent Company financial statements have been properly prepared in accordance with IFRS as adopted by the European Union and as applied in accordance with the provisions of the Companies Act 2006; and
-- the financial statements have been prepared in accordance with the requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the audit of financial statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard as applied to listed entities, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate. Our evaluation of the directors' assessment of the entity's ability to continue to adopt the going concern basis of accounting included review of the forecasts prepared by the Group for at least twelve months from the date of approval of the audit report, conducting appropriate sensitivity analysis on the forecasts, challenging management as to the assumptions used in the forecasts, and consideration of the post-year end performance of the Group including review of available banking and loan facilities.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to fraud) we identified, including those which had the greatest effect on: the overall audit strategy; the allocation of resources in the audit; and directing the efforts of the engagement team. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
Hot Features
Premium
Audit area and description Audit approach
Carrying value of Goodwill and related
cost of investment
The consolidated financial statements We assessed the Directors' assertion
include goodwill of GBP0.896m in that an impairment of GBP3.411m
respect of the acquisition of Parallel was required in respect of goodwill
Live Group (GBP0.896m), acquisition arising on these acquisitions
of the remaining shares in Brick at 31 December 2020 by reference
Live Far East GBPnil) and the acquisition to the trading performance and
of Bright Bricks (GBPnil). cash and profit forecasts of
the acquired entities.
We critically assessed and challenged
the assumptions made by the
Directors in their preparation
of the cash flow and profit
forecasts including an assessment
against current year trading
to date.
-------------------------------------------- ---------------------------------------
Assessment of the accounting treatment
of options and warrants issued
The company issued share options We re-performed the Black-Scholes
during the year under a Share Option option pricing model calculation
Plan adopted in April 2019 and also of the share option and warrants
issued warrants in the year in connection charge prepared by the Directors
with an equity fund raise. under IFRS 2.
We critically assessed and challenged
the variables used by the Directors
in their Black-Scholes option
pricing calculation.
We critically assessed the Directors'
assertion that the warrants
issued as part of the equity
fund raise were issued to equity
holders in their capacity as
equity holders and were therefore
outside the scope of the requirements
of IFRS 2.
=======================================
Termination of Equity Share Agreement
and purchase of shares by Live Company
Group EBT Limited
The company entered into a subscription We critically assessed and challenged
agreement and an Equity Share Agreement the accounting treatment used
(ESA) in the prior year. by the Directors in the company
In the current year the ESA was and consolidated financial statements
terminated by the company. As part and analysed the accounting
of the termination Live Company treatment in accordance with
Group EBT Ltd purchased the shares relevant IFRSs.
held under the ESA.
=======================================
Sale and leaseback of inventories
During the year the Group entered We have critically assessed
into a sale and leaseback Agreement and challenged the Directors
with Close Leasing Limited in respect assertion that the sale and
of GBP1.5m of brick stock. HP Agreement transaction does
not meet the criteria to be
recognised as revenue in accordance
with IFRS 15, "Revenue from
Contracts with Customers" and
therefore in accordance with
the requirements of IFRS 16,
"Leases" in respect of sale
and leaseback arrangements,
has not been derecognised as
inventory and accounted for
as a right of use asset.
=======================================
Going concern The Directors have prepared
Although the group had net current cash flow forecasts for the
assets at 31 December 2020, the period to 31 December 2025.
Group's activities have been significantly We have critically assessed
impacted by the COVID-19 pandemic and challenged the assumptions
and the measures taken to contain included in these cash flow
it. The Group has incurred a further forecasts and performed appropriate
significant loss in the period to sensitivity analysis on the
the date of approval of the financial forecasts.
statements and has limited cash We have critically assessed
funds currently available. These the Directors' ability to raise
factors indicate the existence of further funds either by way
uncertainties at the date of signing of debt finance or equity fundraise
the consolidated financial statements or by the provision of additional
as to whether the Group can continue support to the Group.
to operate as a going concern. We have critically assessed
the disclosures included in
note 1.1 to the consolidated
financial statements.
Our application of materiality
The scope and focus of our audit was influenced by our assessment and application of materiality. We define materiality as the magnitude of misstatement that could reasonably be expected to influence the readers and the economic decisions of the users of the financial statements. We use materiality to determine the scope of our audit and the nature, timing and extent of our audit procedures and evaluate the effect of misstatements both individually and on the financial statements as a whole.
In the light of reduced revenues due to the COVID-19 pandemic, we considered gross assets to be the main focus for readers of the financial statements, and this influenced our judgement of materiality. Based on our professional judgement we determined materiality for the Group to be GBP111,000 based on a percentage of gross assets.
We agreed to report to the Audit Committee all audit differences in excess of the threshold that we had calculated as clearly trivial to the financial statements, and any other differences that, in our view, warranted reporting on qualitative grounds. We also reported disclosure matters that we identified when assessing the overall presentation of the financial statements.
An overview of the scope of our audit
Our audit of the Group and parent Company financial statements was scoped by obtaining an understanding of the Group and parent Company and their environment, including Group wide controls, and assessing the risks of material misstatement at the Group and parent Company level. The whole of the Group is audited by one audit team, led by the Senior Statutory Auditor. Our approach in respect of key audit matters is set out in the table in the Key Audit Matters section.
The audit is performed centrally and comprises all of the companies within the Group, significant components of which were visited by the audit team.
Other information
The Directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor's report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
-- the information given in the Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the parent Company financial statements; and
-- the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the Group and the parent Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Directors' Report.
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
-- adequate accounting records have not been kept by the parent Company, or returns adequate for our audit have not been received from branches not visited by us; or
-- the parent Company financial statements are not in agreement with the accounting records and returns; or
-- certain disclosures of directors' remuneration specified by law are not made; or -- we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the Directors' Responsibilities Statement set out on page 34, the Directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the Directors are responsible for assessing the Group's and the parent Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or the parent Company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below.
Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud
The objectives of our audit in respect of fraud, are; to identify and assess the risks of material misstatement of the financial statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud, through designing and implementing appropriate responses to those assessed risks; and to respond appropriately to instances of fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both management and those charged with governance of the company.
Our approach was as follows:
-- We obtained an understanding of the legal and regulatory requirements applicable to the company and considered that the most significant are [the Companies Act 2006, International Financial Reporting Standards as adopted by the EU, the rules of the Alternative Investment Market, and UK taxation legislation.
-- We obtained an understanding of how the company complies with these requirements by discussions with management and those charged with governance.
-- We assessed the risk of material misstatement of the financial statements, including the risk of material misstatement due to fraud and how it might occur, by holding discussions with management and those charged with governance.
-- We inquired of management and those charged with governance as to any known instances of non-compliance or suspected non-compliance with laws and regulations.
-- Based on this understanding, we designed specific appropriate audit procedures to identify instances of non-compliance with laws and regulations. This included making enquiries of management and those charged with governance and obtaining additional corroborative evidence as required.
As part of an audit in accordance with ISAs (UK) we exercise professional judgement and maintain professional scepticism throughout the audit. We also:
-- Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
-- Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purposes of expressing an opinion on the effectiveness of the Group's internal control.
-- Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Directors.
-- Conclude on the appropriateness of the Directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group's or the parent Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Group or the parent Company to cease to continue as a going concern.
-- Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
-- Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the Group audit. We remain solely responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Use of our report
This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken for no purpose other than to draw to the attention of the Company's members those matters which we are required to include in an auditor's report addressed to them. To the fullest extent permitted by law, we do not accept or assume responsibility to any party other than the Company and Company's members as a body, for our work, for this report, or for the opinions we have formed.
25 June 2021
Matthew Banton (Senior Statutory Auditor) Devonshire House for and on behalf of Moore Kingston Smith 60 Goswell Road LLP, Statutory Auditor London EC1M 7AD
Enquiries:
Live Company Group Plc Tel: 020 7225 2000
David Ciclitira, Executive Chairman
Sarah Dees, Chief Operating Officer
Beaumont Cornish Limited (Nominated Adviser) Tel: 020 7628 3396
Roland Cornish/Rosalind Hill Abrahams
===================
Monecor (London) Limited (Broker) Tel: 020 7392 1436
Elliot Hance
===================
LIVE COMPANY GROUP
Live Company Group plc ("LVCG", the "Company" or the "Group") is a live events and entertainment company, founded by David Ciclitira in December 2017. The Company was admitted to trading on AIM in December 2017, following the reverse acquisition of Brick Live Group and Parallel Live Group by LVCG.
The Group is a network of partner-driven fan-based shows using BRICKLIVE created content worldwide. The Company owns the rights to BRICKLIVE - an interactive experience built around the creative ethos of the world's most popular construction toy bricks. BRICKLIVE, which is fast becoming a leading children's education and entertainment brand, actively encourages all to learn, build and play, and provides inspirational events and shows where like-minded fans can push the boundaries of their creativity. Bright Bricks is the Group's production centre for building brick based models. The Group is an independent producer of BRICKLIVE and is not associated with the LEGO Group. The Company also manages a number of sports, entertainment and lifestyle events via its recently created LCSE (Live Company Sports and Entertainment) division and has an investment in an on-line art platform Start.art.
Website: www.livecompanygroup.com .
Consolidated Statement of Financial Position
Consolidated Statement of Comprehensive Income Year to 31 December
2020 2019
Note GBP'000 GBP'000
Continuing operations
Revenue 4 1,857 5,451
Cost of sales (2,556) (2,360)
----------- -----------
Gross (loss)/profit (699) 3,091
Administrative expenses
Foreign exchange (17) (40)
Depreciation and amortisation of non-financial
assets (119) (78)
Other administrative expenses (3,077) (3,584)
----------- -----------
Total administrative expenses (3,213) (3,702)
Share of result of associate 18 - 86
----------- -----------
Operating loss before exceptional items 5 (3,912) (525)
Exceptional items 6 (4,355) (1,112)
----------- -----------
Operating loss after exceptional items (8,267) (1,637)
Finance costs 10 (110) (207)
----------- -----------
Loss for the year before tax (8,377) (1,844)
Taxation 11 144 (341)
Loss for the year (8,233) (2,185)
Other comprehensive income - -
Total comprehensive income for the year attributable
to the equity holders of the parent Company (8,233) (2,185)
=========== ===========
Loss per share - continuing and total operations
-basic and diluted 12 (9.8p) (3.1p)
Note Consolidated Company
2020 2019 2020 2019
GBP'000 GBP'000 GBP'000 GBP'000
Non-current assets
Property, plant and equipment 13 4,144 4,152 - -
Intangible assets 15 1,516 76 1,450 -
Right of use assets 14 231 292 - -
Trade and other receivables 20 - 2,000 - 2,000
Investments 16 - - 6,025 17,450
Goodwill 17 896 4,307 - -
Investments in associates
and joint ventures 18 - 86 - -
Total non-current assets 6,787 10,913 7,475 19,450
--------- --------- --------- ---------
Current assets
Inventories 19 4,831 6,252 - -
Trade and other receivables 20 404 808 1,460 2,521
Cash and cash equivalents 21 168 98 191 119
Total current assets 5,403 7,158 1,651 2,640
--------- --------- --------- ---------
Total assets 12,190 18,071 9,126 22,090
--------- --------- --------- ---------
Current liabilities
Borrowings 22 615 532 167 532
Trade and other payables 23 2,364 1,617 1,037 357
Lease liabilities 25 60 79 - -
Accruals and deferred income 23 1,120 947 343 292
Total current liabilities 4,159 3,175 1,547 1,181
--------- --------- --------- ---------
Net current assets 1,244 3,983 104 1,459
Non-current liabilities
Deferred tax 26 644 550 288 -
Borrowings 22 1,430 463 83 463
Lease liabilities 25 188 224 - -
--------- --------- --------- ---------
Total non-current liabilities 2,262 1,237 371 463
--------- --------- --------- ---------
Net assets 5,769 13,659 7,208 20,446
========= ========= ========= =========
Equity
Share capital 27 5,165 4,878 5,165 4,878
Share premium 28 25,004 23,480 25,004 23,480
Other reserves (23,697) (23,697) 557 557
Own shares reserve (2,151) - - -
Merger reserve 14,472 14,067 14,472 14,067
Capital redemption reserve 5,034 5,034 5,034 5,034
Share option reserve 30 496 218 496 218
Retained earnings (18,554) (10,321) (43,520) (27,788)
Equity attributable to equity
holders of the parent 5,769 13,659 7,208 20,446
========= ========= ========= =========
As permitted by section 408 of the Companies Act 2006 the parent company's profit and loss account has not been included in these financial statements. The parent company loss for the year, amounted to GBP15,732,000 (2019: GBP2,205,000 loss).
The financial statements were approved and authorised for issue by the Board of Directors on 25 June 2021 and were signed on its behalf by:
David Ciclitira
Chairman
As permitted by section 408 of the Companies Act 2006 the parent company's profit and loss account has not been included in these financial statements. The parent company loss for the year, amounted to GBP15,732,000 (2019: GBP2,205,000 loss).
The financial statements were approved and authorised for issue by the Board of Directors on 25 June 2021 and were signed on its behalf by:
David Ciclitira
Chairman
Statements of Changes in Equity for the year ended 31 December 2020
Ordinary Share Reverse Forex Own Merger Capital Share Retained Total
Share Premium acquisition reserve shares reserve Redemption option Earnings
Capital reserve reserve reserve reserve
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Consolidated
As at 31
December
2019 4,878 23,480 (24,268) 571 - 14,067 5,034 218 (10,321) 13,659
Loss for the
period - - - - - - - - (8,233) (8,233)
Shares issued
for cash 160 840 - - - - - - - 1,000
Shares issued
on
acquisition
of
subsidiary
and novation
of contracts 60 135 - - - 405 - - - 600
Debt to share
conversion 67 633 - - - - - - - 700
Own share
reserves - - - - (2,151) - - - - (2,151)
Warrant
charge - - - - - - - 56 - 56
Options
charge - - - - - - - 222 - 222
Share issue
costs - (84) - - - - - - - (84)
-------------- --------- -------- ------------ -------- -------- -------- ----------- -------- --------- ---------
At 31
December
2020 5,165 25,004 (24,268) 571 (2,151) 14,472 5,034 496 (18,554) 5,769
-------------- --------- -------- ------------ -------- -------- -------- ----------- -------- --------- ---------
Company
As at 31
December
2019 4,878 23,480 - 557 - 14,067 5,034 218 (27,788) 20,446
Loss for the
period - - - - - - - - (15,732) (15,732)
Shares issued
for cash 160 840 - - - - - - - 1,000
Shares issued
on
acquisition
of
subsidiary
and novation
of contracts 60 135 - - - 405 - - - 600
Debt to share
conversion 67 633 - - - - - - - 700
Warrant
charge - - - - - - - 56 - 56
Options
charge - - - - - - - 222 - 222
Share issue
costs - (84) - - - - - - - (84)
At 31
December
2020 5,165 25,004 - 557 - 14,472 5,034 496 (43,520) 7,208
-------------- --------- -------- ------------ -------- -------- -------- ----------- -------- --------- ---------
Ordinary Share Reverse Forex Merger Capital Share Retained Total
Share Premium acquisition reserve reserve Redemption option Earnings
Capital reserve reserve reserve
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Consolidated
As at 31
December
2018 4,754 18,470 (24,268) 571 14,067 5,034 - (8,001) 10,627
Loss for the
period - - - - - - - (2,185) (2,185)
Changes in
fair value
from bricks
used in
product
sales - - - - - - - (135) (135)
Shares issued
for cash 31 1,999 - - - - - - 2,030
Debt to share
conversion 26 1,181 - - - - - - 1,207
Equity Share
Arrangement 67 1,933 - - - - - - 2,000
Warrant
charge - - - - - - 51 - 51
Options
charge - - - - - - 167 - 167
Share issue
costs - (103) - - - - - - (103)
-------------- --------- --------- ------------ ---------- --------- ----------- --------- --------- --------
At 31
December
2019 4,878 23,480 (24,268) 571 14,067 5,034 218 (10,321) 13,659
-------------- --------- --------- ------------ ---------- --------- ----------- --------- --------- --------
Company
As at 31
December
2018 4,754 18,470 - 557 14,067 5,034 - (25,583) 17,299
Loss for the
period - - - - - - - (2,205) (2,205)
Shares issued
for cash 31 1,999 - - - - - - 2,030
Debt to share
conversion 26 1,181 - - - - - - 1,207
Equity Share
Arrangement 67 1,933 - - - - - - 2,000
Warrant
charge - - - - - - 51 - 51
Options
charge - - - - - - 167 - 167
Share issue
costs - (103) - - - - - - (103)
At 31
December
2019 4,878 23,480 - 557 14,067 5,034 218 (27,788) 20,446
-------------- --------- --------- ------------ ---------- --------- ----------- --------- --------- --------
Statements of Cash Flows for the year ended 31 December 2020
Consolidated Company
2020 2019 2020 2019
GBP'000 GBP'000 GBP'000 GBP'000
Cash flows from operating activities
Operating loss (3,912) (525) (1,122) (2,027)
Share of result of associate - (86) - -
Depreciation 751 647 - -
Amortisation of trademarks 11 7 - -
Depreciation of right of use
assets 61 16 - -
Loss on disposal of property,
plant and equipment (192) - - -
Corporation tax paid 209 (134) - -
Net cash flow from exceptional
items (819) - (626) -
Decrease in inventories 1,421 239 - -
Decrease/(increase)in receivables 404 (116) 1,061 (10)
Increase/(decrease) in payables 732 (589) 631 322
Cash used in operations (950) (541) (56) (1,715)
-------- -------- -------- --------
Cash flow from investing activities
Acquisition of intangible fixed
assets (51) (33) (50) -
Acquisition of property, plant
and equipment (935) (1,265) - -
Disposal of property, plant and - 17 - -
equipment
Net cash used in investing activities (986) (1,281) (50) -
-------- -------- -------- --------
Cash flow from financing activities
Issue of equity 1,000 2,030 1,000 2,030
Repayment of lease liabilities (55) (5) - -
Proceeds from borrowings 2,250 300 250 300
Loans repaid (995) (305) (995) (305)
Interest paid (110) (117) 7 (90)
Share issue costs (84) (103) (84) (103)
Net cash generated from financing
activities 2,006 1,800 178 1,832
-------- -------- -------- --------
Net cash inflow/(outflow) 70 (22) 72 117
-------- -------- -------- --------
Cash and cash equivalents at
beginning of the year 98 120 119 2
Net increase/(decrease) in cash
and cash equivalents 70 (22) 72 117
Cash and cash equivalents at
end of the year 168 98 191 119
-------- -------- -------- --------
The termination of the ESA and associated ESA payment of GBP2,000,000 as detailed in Note 33 and the conversion of David Ciclitira's loan of GBP205,000 as detailed in Note 22 are non-cash transactions.
1. Basis of preparation
These financial statements have been prepared on the historical cost basis as modified by use of the fair-value basis where required and in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union, and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS as at 31 December 2020.
The preparation of financial statements in conformity with IFRS requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts in the financial statements which are disclosed in Note 3 to these consolidated financial statements.
1.1 Going concern
These financial statements have been prepared on a going concern basis. The Consolidated Statement of Comprehensive Income shows a loss of GBP8,233,000 for the year ended 31 December 2020 (2019: GBP2,185,000 loss). In assessing going concern the Directors have considered the Group's cash flows, solvency and liquidity positions.
Based on the Group's balance sheet and a review of its forecast future operating budgets and forecasts, the Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for at least twelve months from the date of signing of these consolidated financial statements. This review of future operating budgets and forecasts included certain reasonable downside scenarios and confirmed that even in the case of such downside scenarios the Group could continue to operate and comply with all covenants in our banking facilities. Accordingly, the Directors have adopted the going concern basis in preparing the Annual Report and consolidated financial statements.
The Directors have assessed the viability of the Group over a five-year period, taking account of the Group's current position and prospects, its strategic plan and the principal risks and how these are managed. Based on this assessment, the Directors have a reasonable expectation that the Group will be able to continue in operation and meet its liabilities as they fall due over this period.
In making this assessment, the Directors have considered the resilience of the Group in severe but plausible scenarios, taking into account the principal risks and uncertainties facing the Group and the effectiveness of any mitigating actions. The Directors' assessment considered the potential impacts of these scenarios, both individually and in combination, on the Group's business model, future performance, solvency and liquidity over the period. Sensitivity analysis was also used to stress test the Group's strategic plan and to confirm that sufficient headroom would remain available under the Group's credit facilities. The Directors consider that under each of these scenarios, the mitigating actions would be effective and sufficient to ensure the continued viability of the Group. The Directors believe that five years is an appropriate period for this assessment, reflecting the average length of the Group's contract base; key markets; and the nature of its businesses and products.
Trading has remained extremely difficult thus far in 2021 with COVID-19 restrictions limiting the number and size of events and as a result the Group has continued to make losses in the current trading period. However restrictions are now easing and there are positive signs of business returning.
Consequently, the Directors have prepared these consolidated financial statements on the going concern basis, which assumes that the Group will continue in operational existence for the foreseeable future.
1.2 Adoption of standards effective in 2020
The following new and revised Standards and Interpretations have been issued and are effective for the current financial period of the Company:
-- Definition of Material - amendments to IAS 1 and IAS 9; -- Definition of a Business- amendments to IFRS3; -- Interest Rate Benchmark Reform - amendments to IFRS9, IAS39 and IFRS 7; and -- Revised Conceptual Framework for Financial Reporting. 1.3 IFRS in issue but not applied in the current financial statements
The following IFRS and IFRIC Interpretations have been issued but have not been applied by the Company in preparing these financial statements as they are not as yet effective and, in some cases, had not yet been adopted by the EU. The Company intends to adopt these Standards and Interpretations when they become effective, rather than adopt them early:
-- IFRS 17 Insurance Contracts; -- Amendments to IAS 1 - Classification of Liabilities as Current or Non-current; -- Amendments to IAS 16 - Property, Plant and Equipment: Proceeds before intended use; -- Amendments to IFRS 3 - Reference to the Conceptual Framework; -- Amendments to IAS 37 - Onerous Contracts - Cost of Fulfilling a Contract; -- Annual Improvements to IFRS Standards 2018-2020;
-- Amendments to IFRS 10 and IAS 28 - Sale or contribution of assets between an investor and its associate or joint venture; and
-- Amendments to IFRS 4, IFRS 7, IFRS 9, IFRS 16 & IAS 39 - Interest Rate Benchmark Reform - Phase 2.
The directors do not expect that the adoption the Standards listed above will have a material impact on the Company in future periods.
A number of IFRS and IFRIC Interpretations are also currently in issue which are not relevant for the Company's activities and which have not therefore been adopted in preparing these financial statements.
Other new and amended Standards and Interpretations issued by the IASB that will apply for the first time in the next annual financial statements are not expected to impact the Company as they are either not relevant to the Company's activities or require accounting which is consistent with the Company's current accounting policies.
2. Accounting policies 2.1. Basis of consolidation
The consolidated financial statements incorporate:
-- the results of LVCG, Brick Live Group Limited ("Brick Live Group"), Parallel Live Group Limited ("Parallel Live Group"), Bright Bricks Limited ("Bright Bricks Group"), Live Company Sports and Entertainment Limited ("LCSE") and E Movement Holdings Ltd ("EMHL") for the year ended 31 December 2020.
-- the assets and liabilities of LVCG, Brick Live Group, Parallel Live Group, Bright Bricks Group, LCSE, EMHL and their subsidiary companies at 31 December 2020.
Business combinations
The information contained in this note sets out how the Group typically accounts for Business Combinations, which is effectively using the purchase method explained in IFRS 3, "Business Combinations".
Subsidiary undertakings are all entities over which the Group has the power to govern the financial and operating policies of the subsidiary and therefore exercises control. The existence and effect of both current voting rights and potential voting rights that are currently exercisable or convertible are considered when assessing whether control of an entity is exercised. Subsidiaries are consolidated from the date at which the Group obtains the relevant level of control and are de-consolidated from the date at which control ceases.
Inter-company transactions, balances and unrealised gains on transactions between Group companies are eliminated. Unrealised losses are also eliminated. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group.
The amendments to IFRS 3, "Business Combinations" have clarified the definition of a business and have permitted a simplified assessment of whether an acquired set of activities and assets is a group of assets rather than a business. The Group has assessed the acquisitions detailed in Note 29 on the basis of this amendment.
The cost of an acquisition is measured as an aggregate of the consideration transferred, measured at the acquisition date fair-value and the amount of any non-controlling interest in the acquiree. For each business combination, the Group measures the non-controlling interest in the acquiree at the proportionate share of the acquiree's identifiable net assets. Subsequent changes in the proportion of the non-controlling interests, which do not result in de-recognition of the subsidiary, are accounted for in equity. Costs incurred in connection with acquisitions are recognised as exceptional costs in the income statement, as incurred.
When the Group acquires a business, it assesses the financial assets and liabilities assumed for appropriate classification and designation in accordance with the contractual terms, economic circumstances and pertinent conditions at the acquisition date.
If the business combination is achieved in stages, the acquisition date fair-value of the Group's previously held equity interest in the acquiree is re-measured to fair-value at the acquisition date through profit or loss. Goodwill is initially measured at cost being the excess of the consideration transferred over the Group's share of net identifiable assets acquired and liabilities assumed.
If this consideration is lower than the fair-value of net assets of the subsidiary acquired, the difference is recognised in profit or loss.
After initial recognition, goodwill is measured at cost less any recognised impairment losses. For the purpose of impairment testing, goodwill acquired in a business combination is, from the acquisition date, allocated to either the acquired business or to each of the Group's cash generating units that are expected to benefit from the combination irrespective of whether other assets or liabilities of the acquiree are assigned to those units.
Where goodwill forms a part of a cash-generating unit and part of the operation within that unit is disposed of, the goodwill associated with the operation disposed of is included in the carrying amount of the operation when determining the gain or loss on disposal of the operation. Goodwill disposed of in these circumstances is measured based on the relative values of the operation disposed of and the portion of the cash-generating unit until retained.
Formal impairment reviews were completed at 30 June 2020 and 31 December 2020 given the indicators of impairment existing at both dates.
Brick Live Group
In 2017 the reverse acquisition of LVCG by the Brick Live Group resulted in goodwill arising of GBP4,581,000. This goodwill was fully impaired in the year ended 31 December 2017.
Bright Bricks Group
In October 2018, the Group acquired Bright Bricks Group, resulting in goodwill arising of GBP86,000.
Following the outbreak of COVID-19 the Directors are uncertain of future cashflows and an updated discounted cash flow calculation has been produced with reduced cash flows expected for 2021, this has the impact of reducing the value of the goodwill to GBPnil at 31 December 2020.
Parallel Live Group
In December 2017, the Group acquired Parallel Live Group, resulting in goodwill arising of GBP1,271,000.
Following the outbreak of COVID-19 the Directors are uncertain of future cashflows and an updated discounted cash flow calculation has been produced with reduced cash flows expected for 2021, this has the impact of reducing the value of the goodwill by GBP375,000 at 31 December 2020.
Brick Live Far East Limited ("BLFE")
In December 2017, the Company became the 100% owner of BLFE. Goodwill of GBP2,950,000 arose on the acquisition. BLFE is a company registered in Hong Kong which owns a 49% stake in the Brick Live Group's China associate company, Brick Live Centre Education Development (Beijing) Company Limited.
Following the outbreak of COVID-19 the Directors are uncertain of future cashflows and an updated discounted cash flow calculation has been produced with reduced cash flows expected for 2021, this has the impact of reducing the value of the goodwill to GBPnil at 31 December 2020.
Live Company Sports and Entertainment ("LCSE")
In December 2020 the Group established its new LCSE division, through an all share acquisition of Live Company Sports and Entertainment Limited, including its 50% interest in K-Pop Europa Limited; the novation of a number of contracts from World Sport South Africa (Pty) Limited and the acquisition of the entire issued capital of E Movement Holdings Ltd.
The substance of these transactions is the acquisition of a series of contracts rather than a business combination as defined in IFRS 3, "Business Combinations". The transactions have therefore been accounted for as additions to intangible fixed assets of GBP1,450,000 with no goodwill arising.
Intercompany balances
All intercompany balances are eliminated on consolidation.
Subsidiary companies audit exemption
The company's active subsidiaries Bright Bricks Limited, Brick Live Group Limited, Brick Live International Limited, Brick Live Touring Limited and Parallel Live Group Limited are exempt from the requirements of the Companies Act 2006 relating to the audit of their individual accounts by virtue of section 479A of the Companies Act 2006.
2.2. Intangible fixed assets
Trademarks are registered in each of the geographical territories for the BRICKLIVE brand. Trademarks are amortised on a straight line basis over their estimated useful lives, which is on average 10 years.
Acquired contracts are amortised over the period of the rights acquired, where contracts are renewable and are likely to be renewed for a further period such further period, but no subsequent periods, is considered to be part of the period of the rights acquired.
2.3. Investment in associates and joint ventures
An associate is an entity over which the Group has significant influence and that is neither a subsidiary nor an interest in a joint venture. Significant influence is the power to participate in the financial and operating policy decisions of the investee but does not have control or joint control over those policies. The Group uses the equity method of accounting for its associate.
A joint venture is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the joint arrangement. Joint control is the contractually agreed sharing of control of an arrangement, which exists only when decisions about the relevant activities require unanimous consent of the parties sharing control. The Group uses the equity method of accounting for its joint ventures.
2.4. Property, plant and equipment
All property, plant and equipment assets are stated at cost less accumulated depreciation. Content is capitalised in the periods in which they are purchased or completed and valued at the lower of cost and net realisable value.
Depreciation is provided on content assets over eight years on a straight-line basis to reflect their useful life. Residual values, remaining useful lives and depreciation methods are reviewed annually and adjusted if appropriate.
Depreciation on other fixtures, fittings and office equipment is provided at 20% on a straight-line basis. Residual values, remaining useful lives and depreciation methods are reviewed annually and adjusted if appropriate.
2.5. Leases
Following adoption of IFRS 16, "Leases" a right of use asset, being the present value of the operating lease payments over the remaining life of the lease, has been recognised within non-current assets. The right to use assets and corresponding lease liability have been calculated using a discount rate of 9% which the Directors consider to be appropriate, based on the Group's current borrowing structure. The depreciation of the assets and interest charge are recognised in the Statement of Comprehensive Income in the year and the buildings maturity analysis of lease liabilities at 31 December 2020 is detailed in Note 25.
2.6. Impairment of assets
The carrying amounts of the Group's assets, other than inventories, are reviewed at each reporting date to determine whether there is any indication of impairment. An impairment loss is recognised whenever the carrying amount of an asset or its cash-generating unit exceeds its recoverable amount. Impairment losses are recognised in the Statement of Comprehensive Income. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset's carrying amount does not exceed the carrying amount that would have been determined, net of depreciation, if no impairment loss had been recognised.
2.7. Inventories
Inventories are stated at the lower of cost and net realisable value. Cost comprises direct materials and, where applicable, direct labour costs that have been incurred in bringing the inventories to their present location and condition. Cost is calculated using a weighted average cost method. Net realisable value represents the estimated selling price less all estimated costs of completion and costs to be incurred in marketing, selling and distribution. The majority of inventories are measured at fair value following the acquisition of Bright Bricks Group in October 2018 as detailed in Note 19.
2.8. Financial instruments
Financial assets and financial liabilities are recognised in the Group's statement of financial position when the Group becomes a party to the contractual provisions of the instrument. Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognised immediately in profit or loss.
Financial assets
The Group classifies its financial assets as either financial assets measured at amortised cost, fair value through profit and loss or fair value through Other Comprehensive Income (OCI).
Financial assets at fair value through OCI consist of equity investments in other companies or limited partnerships where the Group does not exercise either control or significant influence.
Financial assets at fair value through OCI are shown at fair value at each reporting date with changes in fair value being shown in OCI. In cases where the Group can reliably estimate fair value, fair value will be determined in reference to practical completion of each development project.
All assets for which fair value is measured or disclosed in the financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:
-- Level 1 - Quoted (unadjusted) market prices in active markets for identical assets or liabilities;
-- Level 2 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable; and
-- Level 3 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable.
Financial instruments are derecognised on the trade date when the Group is no longer a party to the contractual provisions of the instrument.
2.9. Share based payments
The Company issues equity settled share-based payment transactions to certain employees and service providers. Equity settled share-based payment transactions with employees are measured at the fair value at the date of grant. The calculation of fair value at the date of grant requires the use of management's best estimate of volatility, risk free rate and expected time to exercise the options.
Equity settled share based payment transactions with service providers are measured at the fair value of the goods or services received, except where the fair value cannot be reliably estimated, in which case they are measured at the fair value of the equity instrument granted, measured at the date the entity obtains the goods or the counterparty renders the service.
2.10. Trade and other receivables
Trade and other receivables are stated at their amortised cost. Trade receivables are reduced by appropriate allowances for estimated irrecoverable amounts.
A loss allowance is recognised on initial recognition of financial assets held at amortised cost, based on expected credit losses, and is re-measured annually with changes appearing in profit or loss. Where there has been a significant increase in credit risk of the financial instrument since initial recognition, the loss allowance is measured based on lifetime expected losses. In all other cases, the loss allowance is measured based on 12-month expected losses. For assets with a maturity of 12 months or less, including trade receivables, the 12-month expected loss allowance is equal to the lifetime expected loss allowance.
2.11. Cash and cash equivalents
Cash equivalents comprise short-term, highly liquid investments that are readily convertible into known amounts of cash and which are subject to an insignificant risk of changes in value.
2.12. Trade and other payables
Trade and other payables are stated at their amortised cost.
2.13. Interest-bearing borrowings (other than compound financial instruments)
Interest-bearing borrowings are stated at amortised cost using the effective interest method. The effective interest method is a method of calculating the amortised cost of a financial liability and of allocating interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments through the expected life of the financial liability.
2.14. Revenue recognition
Revenue is the value of goods and services provided by the Group to customers, net of VAT and discounts. Revenue includes licence fees, revenue from the sale of products, rental fees, sale of content (brick-based statues), brick lease fees and ticket sales from self-promoted events.
Revenue from contracts is recognised in accordance with IFRS 15 as follows:
i. Identify the contract with the customer; ii. Identify separate performance obligations in the contract; iii. Determine the transaction price; iv. Allocate the transaction price to separate performance obligations; and v. Recognise revenue when the entity satisfies a performance obligation.
Revenue recognised as above is measured on the following basis:
i. Annual licence fees - on a straight-line basis in accordance with the terms of the agreement, unless it is non-refundable in which case fees are recognised on the contractual invoice date;
ii. Event licence fees and revenue shares - in accordance with the terms of the agreement;
iii. Content fees - on delivery of the specific content to the client in accordance with the terms of the agreement;
iv. Tour and show rental fees - in accordance with the terms of the agreement; v. Brick lease fees - on a straight-line basis in accordance with the terms of the agreement; vi. Ticket sales from self-promoted events - on the date of the event; and
vii. Sales of products - in accordance with contract.
2.15. Deferred taxation
Deferred tax is provided in full using the balance sheet liability method. Deferred tax is the future tax consequences of temporary differences between the carrying amounts and tax bases of assets and liabilities shown on the Statement of Financial Position.
The amount of deferred tax provided is based on the expected manner of recovery or settlement of the carrying amount of assets and liabilities, using tax rates enacted or substantively enacted at the reporting date.
The Group does not recognise deferred tax liabilities, or deferred tax assets, on temporary differences associated with investments in subsidiaries, as it is not considered probable that the temporary differences will reverse in the foreseeable future.
A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be available against which the asset can be utilised. The carrying amounts of the deferred tax assets are reviewed at each statement of financial position date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the assets to be recovered.
2.16. Segmental reporting
The Group has two operating segments, namely: tours, events, shows, licences and content rental fees; and product and content sales. In identifying these operating segments, management generally follows the Group's service lines representing its main products and services (see Note 4).
For management purposes, the Group uses the same measurement policies as those used in its consolidated financial statements, except for certain items not included in determining the operating profit of the operating segments, such as exceptional costs.
In addition, corporate assets and expenses which are not directly attributable to the business activities of any operating segment are not allocated to a segment. This primarily applies to the Group's headquarters.
2.17. Foreign currencies
Monetary assets and liabilities expressed in foreign currencies are translated at the rates of exchange ruling at the reporting date. Transactions in foreign currencies are translated at the rate ruling at the date of the transaction. Differences on exchange arising on translation of subsidiaries are charged directly to other comprehensive income. All other exchange differences have been charged to the profit or loss in the period under review.
2.18. Exceptional items
Exceptional items are those costs incurred by the Group which are considered by the Directors to be material in size and are unusual and infrequent in occurrence which require separate disclosure within the financial statements. See Note 7 for details of exceptional items ensuing in the year.
2.19. Government grants and assistance
Government grants and assistance are recognised in the related expense line in the consolidated statement of comprehensive income on a systematic basis over the period in which the entity recognises the expense, for which the grant is intended to compensate.
Therefore, grants in recognition of specific expenses are recognised in the related expense line in the same period.
3. Accounting estimates and judgements
The preparation of these consolidated financial statements in accordance with generally accepted accounting practice, being International Financial Reporting Standards as adopted by the European Union, requires the Directors to make estimates and judgements that affect the reported amount of assets, liabilities, income and expenditure and the disclosures made in these consolidated financial statements. Such estimates and judgements are continually evaluated based on historical experience and other factors, including expectations of future events.
The significant judgements made by management in applying the Group's accounting policies as set out above, and the key sources of estimation which management consider may have a significant risk of causing a material adjustment to the reported amounts in the year, were:
Impairment of investments and goodwill
The Directors have carried out impairment reviews of the Group's goodwill, investments and the share of net assets of associates as detailed in Notes 16, 17 and 18.
Depreciation and amortisation
Depreciation and amortisation rates have been set to accurately reflect the reduction in value of property, plant and equipment assets over their economic life, less their expected residual value. This requires judgement by the Directors, who have set the depreciation rates as detailed in Notes 2.2 and 2.4 to these consolidated financial statements based on their knowledge of the industry and typically how long each asset type retains its value.
Revenue recognition with customers
Revenue from contracts with customers is recognised in accordance with IFRS 15. This requires judgement as revenue transactions are subject to a variety of contract terms, albeit under the general guidelines of the accounting policies for revenue recognition as explained in Note 2.14 to these consolidated financial statements.
Share option and warrants
The Black-Scholes model is used to calculate the appropriate charge of the share options and warrants. The use of this model to calculate the charge involves a number of estimates and judgements to establish the appropriate inputs to be entered into the model, covering areas such as the use of an appropriate interest rate and dividend rate, exercise restrictions and behavioural considerations. A significant element of judgement is therefore involved in the calculation of the charge.
Contingent consideration
Contingent consideration recorded as a financial liability at fair value. The amount of contingent consideration to be paid is based on the occurrence of future events, such as the achievement of certain development, regulatory and sales milestones. Accordingly, the estimate of fair value contains uncertainties as it involves judgment about the likelihood and timing of achieving these milestones as well as the discount rate used. Changes in fair value of the contingent consideration obligation result from changes to the assumptions used to estimate the probability of success for each milestone, the anticipated timing of achieving the milestones and the discount period and rate to be applied.
4. Segment reporting
As described in Note 2.16 to these consolidated financial statements, the Directors consider that the Group's internal financial reporting is organised along product and service lines and therefore segmental information has been presented about the Group's business segments. The segmental analysis of the Group's business is derived from its principal activities, as set out below.
Reportable segments
The reportable segment results for the year ended 31 December 2020 are as follows:
Tours, events,
Product licenses
and content and content
sales rental fees Unallocated Total
GBP'000 GBP'000 GBP'000 GBP'000
Revenue 497 1,360 - 1,857
------------- --------------- ------------ --------
Cost of sales 684 1,872 - 2,556
Administrative expenses 561 1,535 1,117 3,213
Finance costs - - 110 110
Exceptional items - - 4,355 4,355
Taxation - - (144) (144)
Segment loss the
year (748) (2,047) (5,438) (8,233)
------------- --------------- ------------ --------
The reportable segment results for the year ended 31 December 2019 were as follows:
Tours, events,
Product licenses
and content and content
sales rental fees Unallocated Total
GBP'000 GBP'000 GBP'000 GBP'000
Revenue 974 4,477 - 5,451
------------- --------------- ------------ --------
Cost of sales 421 1,939 - 2,360
Administrative expenses 413 1,898 1,391 3,702
Share of associate - - (86) (86)
Finance costs - 207 207
Exceptional items - - 1,112 1,112
Taxation 341 341
Segment profit/(loss)
for the year 140 640 (2,965) (2,185)
------------- --------------- ------------ --------
Administrative expenses are apportioned to each trading segment in proportion to the revenue earned.
Segment assets consist primarily of property, plant and equipment, intangible assets, investments, goodwill, trade and other receivables and cash and cash equivalents.
Unallocated assets comprise deferred taxation, financial assets held at fair value through profit or loss, and derivatives. Segment liabilities comprise operating liabilities; liabilities such as deferred taxation are not allocated to individual business segments.
Segment assets and liabilities as at 31 December 2020 are as follows:
Tours, events, shows, licences and content rental
Product and content sales fees Unallocated Total
GBP'000 GBP'000 GBP'000 GBP'000
Assets - 10,868 1,322 12,190
--------------------------- -------------------------------------------------- ------------ --------
Liabilities - 5,776 645 6,421
--------------------------- -------------------------------------------------- ------------ --------
Segment assets and liabilities as at 31 December 2019 were as follows:
Tours, events, shows, licences and content rental
Product and content sales fees Unallocated Total
GBP'000 GBP'000 GBP'000 GBP'000
Assets - 11,549 6,522 18,071
--------------------------- -------------------------------------------------- ------------ --------
Liabilities - 2,867 1,545 4,412
--------------------------- -------------------------------------------------- ------------ --------
Geographical information
The Group's business segments operated in six principal geographical areas in the year, although they are managed on a worldwide basis from the Group's head office in the United Kingdom.
A geographical analysis of the Group's continuing revenue and non-current assets is given below. Revenue is allocated based on the location of the customer; non-current assets are allocated based on the physical location of the asset.
2020 2019
GBP'000 GBP'000
Revenue
United Kingdom 1,013 2,923
Europe 49 930
USA 265 406
South America - 46
Asia 434 1,111
Middle East 96 35
-------- --------
1,857 5,451
======== ========
2020 2019
GBP'000 GBP'000
Non-current assets
United Kingdom 4,445 4,661
Europe - 986
USA 394 467
South America 31 -
Asia 711 407
Middle East 310 -
Unallocated 896 4,392
-------- --------
6,787 10,913
======== ========
Major customers
Included within Tours, events, licenses and content rental fees are revenues of GBP225,000 (2019: GBP532,000) which arose from sales to the Groups largest customer. No single customer in 2020 or 2019 accounted for more than 10% of revenue.
5. Operating loss before exceptional items
2020 2019
GBP'000 GBP'000
This is stated after charging:
Content depreciation (included within
cost of sales) 705 589
Loss on disposal of content assets (included
within cost of sales) 192 17
Other depreciation and amortisation (included
within administrative expenses) 57 63
Depreciation on right of use assets 61 16
Net foreign exchange losses 17 40
======== ========
6. Exceptional items
The exceptional items consist of the following:
2020 2019
GBP'000 GBP'000
Share options and warrants charge 278 218
Transactional and reorganisational costs 2,676 612
Impairment of associate and intangible 1,401 -
assets
Exceptional bad debt - 282
4,355 1,112
-------- --------
2020 Exceptional items
Share option and warrant charge
The Group uses the Black-Scholes model to value its share option and warrants. Certain judgement is required in terms of selecting the risk-free interest rate and standard deviation rate used. The charge for the current year is GBP278,000 which may increase or decrease with changes to these rates.
Transactional and reorganisational costs
Transactional costs relate to various debt and equity raises completed during the year as detailed in Note 22 as well as costs associated with terminating the ESA as detailed in Note 33.
Impairment of associate and intangible assets
The Directors have considered the carrying value of goodwill, investments and the share of net assets of associates in light of the impact of COVID-19, together with the effects of the measures taken to contain it in the markets in which the Group operates and have determined the impairment, as detailed in Notes 16, 17 and 18 is required.
Included in the Consolidated Statement of Financial Position at 31 December 2019 was GBP86,700 being the Groups share of the net assets of Brick Live Centre Education Development (Beijing) Company Limited a company incorporated in China in which the Group indirectly holds a 49% interest through its 100% holding in Brick Live Far East Limited. Due to the impact of COVID-19 on the recoverability of this balance, the Directors have provided in full against this amount.
2019 Exceptional items
Share option and warrant charge
The Group uses the Black-Scholes model to value its share option and warrants. Certain judgement is required in terms of selecting the risk-free interest rate and standard deviation rate used. The charge for the prior year is GBP218,000 which may increase or decrease with changes to these rates.
Transactional and reorganisational costs
Transaction costs relate to the remainder of the strategic acquisition and reorganisation costs of Bright Bricks Group and the various fundraises completed during the prior year.
Exceptional bad debt provision
A three-year contract is in place with Brick Live Centre Education Development (Beijing) Company Limited for a minimum of 20 shows. Due to the uncertainty of recovering this balance, the Directors have provided in full against these receivable license fee balances.
7. Auditor's remuneration
2020 2019
GBP'000 GBP'000
Fees payable to the auditor, Moore Kingston
Smith LLP, for the audit of the annual
accounts of the Group and the Company 76 87
Taxation compliance 8 8
84 95
-------- --------
8. Employees
2020 2019
Group No. No.
The average number of employees (including
Directors not under employment contracts)
during the year was:
Administration 5 22
Production 44 40
Sales 3 4
----- -----
52 66
===== =====
2020 2019
GBP'000 GBP'000
The aggregate payroll costs including Directors
not under employment contracts) were:
Wages, salaries and fees 1,825 2,566
Social security costs 133 177
Pension costs 22 31
-------- --------
1,980 2,774
-------- --------
9. Remuneration of Directors and key management personnel
In the opinion of the Board, only the Directors of the Company and the other members of the Executive Team, as detailed in the Corporate Governance Report, are regarded as key management personnel. The remuneration of key management personnel during 2020 was, in aggregate, GBP508,000 (2019: GBP859,000).
Directors' remuneration and fees, including Non-Executive Directors, during the year were as follows:
2020 2019
GBP'000 GBP'000
David Ciclitira 330 451
Andy Smith (resigned 2 September 2019) - 74
Bryan Lawrie 76 144
Serenella Ciclitira* 10 20
Ranjit Murugason* 20 125
Trudy Norris-Grey (resigned 14 February
2021) 52 20
Simon Horgan (resigned 17 February 2021)* 10 20
Mark Freebairn (resigned 14 February 2021)* 10 5
-------- --------
508 859
-------- --------
*The Non-Executive Directors waived their fees for Q2 and Q3.
David Ciclitira 2020 2019
GBP'000 GBP'000
UK Chairman's fees 25 25
International consultancy fees 250 250
Additional contracted work during the year 55 176
-------- --------
330 451
-------- --------
David Ciclitira invoiced a further GBP178,000 (2019; GBPnil) for further additional contracted work during the year which was subsequently paid but then waived by credit note. This balance is included in the unpaid balances due to related parties at 31 December 2020 as detailed in Note 32. Post year end this was subsequently offset against the outstanding loan balance due to David Ciclitira detailed in Note
22. Ranjit Murugason
2020 2019
GBP'000 GBP'000
Non-Executive fees 20 30
Fees in connection with fundraise in February
2019 - 45
Bright Bricks integration and Singapore
company closure fees - 50
-------- --------
20 125
-------- --------
The remuneration for Ranjit Murugason in the prior year was satisfied by the issue of new Ordinary shares as detailed in Note 27.
Andrew Smith
2020 2019
GBP'000 GBP'000
As Chief Strategic Officer - 38
As Executive Chairman of Bright Bricks Group - 36
- 74
-------------------------------------------------------- --------
Andrew Smith received a further GBP32,000 for the remainder of the prior year after his resignation.
Bryan Lawrie
2020 2019
GBP'000 GBP'000
Fees as Chief Financial Officer 71 144
Non-Executive fees 5 -
76 144
-------- --------
Fees paid to Bryan Lawrie as Chief Financial Officer were paid to CFO Partners Limited.
Further information on related party transactions are set out in Note 32.
10. Finance costs
2020 2019
GBP'000 GBP'000
Loan interest 59 185
Interest expense on lease liabilities 24 7
Other 27 15
-------- --------
110 207
-------- --------
11. Taxation
2020 2019
Current tax GBP'000 GBP'000
UK Corporation tax in respect of current
year:
Current taxation - -
Adjustments in respect of prior years (238) (86)
-------- --------
Total tax (credit) charge for the year (238) (86)
-------- --------
Deferred taxation
Original and reversal of timing differences 28 427
Effect of change in tax rates 66 -
Total deferred taxation charge 94 427
-------- --------
Tax charge on loss on ordinary activities (144) 341
-------- --------
2020 2019
GBP'000 GBP'000
Loss on ordinary activities before tax (8,388) (1,844)
Loss on ordinary activities at the standard
rate of corporation tax of 19% (2019: 19%) (1,594) (350)
Effect of disallowable expenditure 932 -
Tax losses carried forward 662 350
-------- --------
Total tax charge for the year - -
-------- --------
12. Earnings per share
The basic earnings per share is calculated by dividing the (loss)/profit attributable to equity shareholders by the weighted average number of shares in issue during the year. In calculating the diluted earnings per share, any outstanding share options, warrants and convertible loans are taken into account where the impact of these is dilutive.
2020 2019
Loss for the year after tax (GBP'000) (8,233) (2,185)
Weighted average number of shares in issue 83,678,936 70,171,496
Basic and diluted earnings per share * (9.8p) (3.1p)
* Diluted earnings per share in both 2020 and 2019 are the same as basic earnings per share, as there are no dilutive options in issue during these years.
13. Property, plant and equipment
Group Content Other Total
2020 2019 2020 2019 2020 2019
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Cost
Cost at start of year 5,015 3,801 176 152 5,191 3,953
Additions for year 921 1,239 14 24 935 1,263
Disposals (380) (25) (15) - (395) (25)
-------- -------- -------- -------- -------- --------
Cost at end of year 5,556 5,015 175 176 5,731 5,191
-------- -------- -------- -------- -------- --------
Depreciation
Cumulative depreciation
at start of year 970 389 69 13 1,039 402
Charge for year 705 589 46 56 751 645
Eliminated on disposal (188) (8) (15) - (203) (8)
-------- -------- -------- -------- -------- --------
Cumulative depreciation
at end of year 1,487 970 100 69 1,587 1,039
-------- -------- -------- -------- -------- --------
Net book value at
end of year 4,069 4,045 75 107 4,144 4,152
-------- -------- -------- -------- -------- --------
Net book value at
start of year 4,045 3,412 107 139 4,152 3,551
-------- -------- -------- -------- -------- --------
The Company had no property, plant and equipment assets in either 2020 or 2019.
14. Right of use Assets
Buildings Group Company
2020 2019 2020 2019
GBP'000 GBP'000 GBP'000 GBP'000
-------- -------- -------- --------
Cost
Cost at start of year 308 - - -
Additions for year - 308 - -
Cost at end of year 308 308 - -
-------- -------- -------- --------
Depreciation
Cumulative depreciation at start of year 16 - - -
Charge for year 61 16 - -
Cumulative depreciation at end of year 77 16 - -
-------- -------- -------- --------
Net book value at end of year 231 292 - -
-------- -------- -------- --------
Net book value at start of year 292 - - -
-------- -------- -------- --------
15. Intangible assets
Group Company
2020 2019 2020 2019
GBP'000 GBP'000 GBP'000 GBP'000
-------- -------- -------- --------
Cost
Cost at start of year 88 55 - -
Additions for year 1,451 33 1,450 -
Cost at end of year 1,539 88 1,450 -
-------- -------- -------- --------
Amortisation
Cumulative amortisation at start of year 12 5 - -
Charge for year 11 7 - -
Cumulative amortisation at end of year 23 12 - -
-------- -------- -------- --------
Net book value at end of year 1,516 76 1,450 -
-------- -------- -------- --------
Net book value at start of year 76 50 - -
-------- -------- -------- --------
Trademarks
Trademarks are obtained for each show in each jurisdiction around the world. Trademarks are amortised over their estimated useful lives, which is on average 10 years. The carrying value of trademarks at 31 December 2020 is GBP66,000 (2019; GBP76,000).
LCSE
In December 2020 the Company acquired the entire issued share capital of Live Company Sports and Entertainment Limited together with its wholly owned subsidiary Live Company Sports and Entertainment (Pty) Limited and 50% interest in K-Pop Europa Limited for GBP650,000 and purchased certain contracts from World Sport South Africa (Pty) Limited for GBP500,000 to create a new Sports and Entertainment division (RNS Number : 3562H 03 December 2020).
In December 2020 the Company acquired the entire issued share capital of E Movement Holdings Ltd for GBP300,000 (RNS Number : 3562H 03 December 2020).
The substance of these transactions is the acquisition of a series of contracts rather than a business combination as defined in IFRS 3 "Business Combinations". The transactions have therefore been accounted for as additions to intangible fixed assets of GBP1,450,000. The acquired contracts are amortised over the period of the rights acquired, where contracts are renewable and are likely to be renewed for a further period such further period, but no subsequent periods, is considered to be part of the period of the rights acquired.
Tournament rights
Tournament rights are the rights to promote European Tour golf events acquired in September 2006. These intangible assets are carried at cost less amortisation. Amortisation was initially calculated to write off the assets over their expected useful life of 20 years however, the Directors undertook an impairment review regarding the value of the Tournament rights in 2018 which resulted in a write down to GBPnil to reflect the fact that the ongoing business of the Group is not expected to generate revenues from these rights in the foreseeable future.
16. Investments
Group Company
2020 2019 2020 2019
GBP'000 GBP'000 GBP'000 GBP'000
Cost
Cost at start of the year - - 17,450 17,450
Additions for the year - - - -
---------- ---------- --------- ---------
Cost at end of year - - 17,450 17,450
---------- ---------- --------- ---------
Impairment
At start of the year - - - -
Impairment in the year - - 11,425 -
Cumulative impairment at - - 11,425 -
end of year
Net book value at end of
the year - - 6,025 17,450
---------- ---------- --------- ---------
Net book value at start of
year - - 17,450 17,450
---------- ---------- --------- ---------
In light of the impact of COVID-19, together with the effects of the measures taken to contain it in the markets in which the Group operates, the Directors considered the carrying value of investments at 30 June 2020 (as detailed in Note 3 to the results for the six months ended 30 June 2020) and again at 31 December 2020.
As a cash generating unit the carrying value was assessed based on a discounted cashflow over five years at the Groups current cost of capital, considered by the Directors to be 9%, and it was determined the impairment, as described in the table below, was required.
At start Additions Impairment At end
of year of year
GBP'000 GBP'000 GBP'000 GBP'000
Brick Live Far East Limited 2,950 - (2,950) -
Brick Live Group (incorporating
Bright Bricks Limited) 13,500 - (8,475) 5,025
Parallel Live Group 1,000 - - 1,000
17,450 - (11,425) 6,025
---------- ----------- ------------ ----------
17. Goodwill
Group Company
2020 2019 2020 2019
GBP'000 GBP'000 GBP'000 GBP'000
Cost at start and end of
year 8,888 8,888 - -
--------- --------- --------- ---------
Impairment
At start of the year 4,581 4,581 - -
Impairment in the year 3,411 - - -
--------- --------- --------- ---------
Cumulative impairment at
end of year 7,992 4,581 - -
--------- --------- --------- ---------
Net book value at end of
year 896 4,307 - -
--------- --------- --------- ---------
Net book value at start of
year 4,307 4,307 - -
--------- --------- --------- ---------
As detailed in Note 3 to the results for the six months ended 30 June 2020 the Directors considered the carrying value of goodwill in light of the impact of COVID-19, together with the effects of the measures taken to contain it in the markets in which the Group operates.
As a cash generating unit the carrying value was assessed based on a discounted cashflow over five years at the Groups current cost of capital, considered by the Directors to be 9%, and it was determined the impairment, as described in the table below, was required.
The Directors further considered the carrying value of goodwill at 31 December 2020 and determined no further impairment was required.
At start Additions Impairment At end
of year of year
GBP'000 GBP'000 GBP'000 GBP'000
Brick Live Far East Limited 2,950 - (2,950) -
Brick Live Group (incorporating
Bright Bricks Limited) 86 - (86) -
Parallel Live Group 1,271 - (375) 896
4,307 - (3,411) 896
---------- ----------- ------------ ----------
18. Investments in Associates and Joint Ventures
Group Company
2020 2019 2020 2019
GBP'000 GBP'000 GBP'000 GBP'000
Cost
Cost at start of year 197 111 - -
Additions in the year - 86 - -
--------- --------- --------- ---------
Cost at end of year 197 197 - -
--------- --------- --------- ---------
Impairment
At start of year 111 111 - -
Impairment in the year 86 - - -
--------- --------- --------- ---------
At end of year 197 111 - -
--------- --------- --------- ---------
Net book value at end of - -
year - 86
--------- --------- --------- ---------
Net book value at start of - -
year 86 -
--------- --------- --------- ---------
In July 2017, BLFE entered into a long-term agreement with Fortune Access, to create a limited liability foreign enterprise company in China called BRICKLIVE China. BLFE agreed to invest 980,000 RMB (approximately GBP111,000) for a 49% shareholding in BRICKLIVE China.
Based on the performance in the year ended 31 December 2018 the investment in the associate was impaired by GBP111,000.
At 31 December 2019, the share of the associate's net profits amounted to GBP86,000 which was added to the carrying value of the investment. As detailed in Note 3 to the results for the six months ended 30 June 2020 the Directors considered the carrying value of the share of net assets in light of the impact of COVID-19, together with the effects of the measures taken to contain it, in the markets in which the Group operates, and determined this should be impaired to GBPnil.
The Directors further considered the carrying value of the investment at 31 December 2020 and determined no further adjustment to the carrying value was required.
The results of the Associate in the year are: 2020 2019
GBP'000 GBP'000
-------- --------
Revenue 128 1,819
-------- --------
(Loss)/profit before tax (500) 220
Taxation - (17)
-------- --------
(Loss)/profit after tax (500) 203
Current assets 287 573
Non-current assets 693 1,317
Current liabilities (912) (1,549)
Non-current liabilities - -
68 341
-------- --------
Parallel Three Six Zero Inc
In September 2018, Parallel Live Group signed a joint venture agreement with US-based company Three Six Zero, forming the new company Parallel Three Six Zero Inc. It has been granted exclusive rights by Parallel Live Group to promote BRICKLIVE events in North America and Canada with Brick Live International Limited as its content provider.
Trading in the joint venture commenced in January 2019. The Group accounts for the joint venture under the equity method of accounting.
The results of the Joint Venture in the
year are:
2020 2019
GBP'000 GBP'000
-------- --------
Revenue - 113
-------- --------
Loss before tax (1) (26)
Taxation - -
-------- --------
Loss after tax (1) (26)
Current assets - -
Non-current assets - -
Current liabilities (27) (26)
Non-current liabilities - -
(27) (26)
-------- --------
BRICKLIVE (South Africa) Limited
In November 2019, Brick Live International Limited signed an agreement with World Sport South Africa (Pty) Limited, a company incorporated in South Africa, to create BRICKLIVE (South Africa) Limited to be owned 50.1% by BLI and 49.9% by WSSA.
Following the acquisition of Live Company Sports and Entertainment and purchase of certain contracts from WSSA in December 2020 (RNS Number : 3562H 03 December 2020) this agreement was terminated without trading ever commencing.
19. Inventories
Group Company
2020 2019 2020 2019
GBP'000 GBP'000 GBP'000 GBP'000
Inventories of bricks 4,633 6,100 - -
Work in progress 198 152 - -
-------- -------- -------- --------
4,831 6,252 - -
-------- -------- -------- --------
Included in inventories is GBP3,983,000 (2019: GBP5,323,000) of stock acquired on acquisition of Bright Bricks Group and included at fair value at that date.
Included in inventories is GBP1,500,000 (2019: GBPnil) subject to a sale and HP Agreement entered into with Close Leasing Limited, (see Note 22).
20. Trade and other receivables - current assets
Group Company
2020 2019 2020 2019
GBP'000 GBP'000 GBP'000 GBP'000
Trade receivables 123 455 - -
Amounts owed by subsidiaries - - 1,226 2,512
Other receivables 64 265 78 9
Prepayments and accrued
income 217 88 156 -
-------- -------- -------- --------
404 808 1,460 2,521
-------- -------- -------- --------
Trade and other receivables - non current assets
Group Company
2020 2019 2020 2019
GBP'000 GBP'000 GBP'000 GBP'000
Other receivables - 2,000 - 2,000
--------- -------- -------- --------
- 2,000 - 2,000
----------------------------- -------- -------- --------
Included in non current assets in other receivables is a GBPnil (2019: GBP2,000,000) Equity Share Agreement (ESA) debtor as set out in Note 33.
Amounts owed by subsidiaries are considered interest free and repayable on demand.
21. Cash and cash equivalents
Group Company
2020 2019 2020 2019
GBP'000 GBP'000 GBP'000 GBP'000
Cash at bank 168 98 191 119
-------- -------- -------- --------
22. Borrowings
Group Company
2020 2019 2020 2019
GBP'000 GBP'000 GBP'000 GBP'000
Loan due within one year 615 532 167 532
Loan due after one year 1,430 463 83 463
2,045 995 250 995
-------- -------- -------- --------
In April 2020 the Group entered into a GBP250,000 CBILS loan agreement with NatWest Bank Plc (RNS Number : 4000L 30 April 2020), which remained outstanding at the balance sheet date; and a GBP500,000 loan agreement with David Ciclitira (RNS Number : 6990J 15 April 2020), GBP205,000 of which was converted into equity in June 2020 (RNS Number : 1520R 26 June 2020) leaving GBP295,000 outstanding at the balance sheet date. After the balance sheet date the loan was partly repaid by the offset of the credit note detailed in Note 9 and the conversion of GBP30,000 to equity at 5p per share as detailed in Note 36 leaving a balance of GBP90,823 outstanding. The loan from David Ciclitira bears interest at 16.2% and is secured by a second fixed and floating charge over the Groups assets with priority given to the security held by Close Leasing Limited as detailed below.
In August 2020 (RNS Number : 2514W 17 August 2020) the Group entered into an agreement with Close Leasing Limited whereby stock totalling GBP1,500,000 included under Inventories in the Statement of Financial Position in these consolidated financial statements was sold to Close Leasing Limited and purchased back under the terms of a Hire Purchase Facility (HP Agreement) provided in conjunction with the CBILS.
The substance of the transaction meant that no performance obligation arose and control of the stock did not pass to Close Leasing Limited thus in accordance with IFRS 15, "Revenue from Contracts with Customers" no revenue was recognised on the transaction and thus in accordance with IFRS 16, "Leases" no right of use asset was created. The obligation under the HP Agreement is thus included in borrowings in accordance with IFRS 9, "Financial Instruments".
The HP Agreement was for a term of five years at an effective interest rate of 5.14% secured against the GBP1.500.000 of stock subject to the agreement and a fixed and floating charge over the Groups other assets.
The proceeds from the facility were used to repay the outstanding YA II and RiverFort borrowing in full (2020: GBPnil; 2019: GBP995,000) and to terminate the ESA described in Note 33.
23. Trade and other payables
Group Company
2020 2019 2020 2019
GBP'000 GBP'000 GBP'000 GBP'000
Trade payables 574 720 112 198
Amounts owed to subsidiaries - - 66 66
Other payables 866 210 835 83
Other taxation and social
security 924 687 24 10
Accruals and deferred income 1,120 947 343 291
-------- -------- -------- --------
3,484 2,564 1,380 648
-------- -------- -------- --------
Amounts owed to subsidiaries are unsecured, interest free and repayable on demand.
Other payables include GBP800,000 (2019: GBPnil) of deferred consideration as detailed in Note 29.
24. Financial risks
The Group and Company operations expose them to a number of financial risks. The Directors aim to protect the Group and Company against the potential adverse effects of these financial risks.
Financial assets
Financial assets include cash and trade and other receivables, excluding prepayments.
These amounts, where appropriate, have been shown separately on the face of the Statement of Financial Position. Funds not immediately required for the Group and Company's operations are invested in bank deposits. It is the Directors' opinion that the carrying values of cash, trade receivables and investments approximate to their fair values.
Financial liabilities
Financial liabilities include current and non-current borrowings and trade and other payables (excluding taxation and social security and deferred income).
All amounts are carried at amortised cost. These amounts have been disclosed in the notes to the financial statements. It is the Directors' opinion that the carrying values of financial liabilities approximate to their fair-value.
Liquidity risk
The Group and Company's surplus liquid resources are maintained on short-term interest-bearing deposits. The Group and Company plans to continue to meet operating and other loan commitments as they fall due. Liquidity risk is managed through cash flow forecasts and regular planning.
Set out below are liquidity risk comparative tables as at 31 December 2020 and 31 December 2019.
Remaining contractual maturities year ended 31 December 2020
Group Within > 3 months > one Total
3 months < 1 year year carrying
< 5 years amount
GBP'000 GBP'000 GBP'000 GBP'000
Bank loans and borrowings 8 607 1,430 2,045
Trade and other payables* 1,440 - - 1,440
Lease liabilities 15 45 188 248
---------------- ----------- ----------- ---------------
1,463 652 1,618 3,733
---------------- ----------- ----------- ---------------
Company Within > 3 months > one year Total carrying
3 months < 1 year < 5 years amount
GBP'000 GBP'000 GBP'000 GBP'000
Bank loans and borrowings - 167 83 250
Trade and other payables* 1,013 - - 1,013
---------------- ----------- ----------- -----------------
1,013 167 83 1,263
---------------- ----------- ----------- -----------------
Remaining contractual maturities year ended 31 December
2019
Group Within > 3 months > one year Total carrying
3 months < 1 year < 5 years amount
GBP'000 GBP'000 GBP'000 GBP'000
Bank loans and borrowings - 532 463 995
Trade and other payables 930 - - 930
Leases 20 59 223 302
---------------- ----------- ----------- -----------------
950 591 686 2,227
---------------- ----------- ----------- -----------------
Company Within > 3 months > one year Total carrying
3 months < 1 year < 5 years amount
GBP'000 GBP'000 GBP'000 GBP'000
Bank loans and borrowings - 532 463 995
Trade and other payables 347 - - 347
========== =========== =========== ===============
347 532 463 1,342
---------- ----------- ----------- ---------------
The trade and other payables above exclude taxation and accruals and deferred income.
Credit risk
Financial assets past due but not impaired as at 31 December 2020:
Not impaired Not impaired but past due
and not by the following amounts
past due
>30 days >60 days >90 days >120 days
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Group: Trade and
other receivables 113 25 - - 49
Company: Trade and
other receivables 1,304 - - - -
Financial assets past due but not impaired as at 31 December 2019:
Not impaired Not impaired but past due
and not by the following amounts
past due
>30 days >60 days >90 days >120 days
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Group: Trade and
other receivables 2,720 - - - -
Company: Trade and
other receivables 4,521 - - - -
The trade and other receivables above exclude prepayments and accrued income.
Group trade and other receivables excluding prepayments and accrued income as at 31 December 2020 were GBP187,000 (2019: GBP2,720,000), all of which are not impaired. All remaining trade and other receivables as at 31 December 2020 are collected and/or collectable and are considered of low credit risk. All bank deposits are maintained in the United Kingdom and are low credit risk.
Market risk
a. Interest rate risk
The Group had two outstanding loans (one with NatWest Bank PLC and one with David Ciclitira) and the HP Agreement with Close Leasing Limited at the year end (2019: two with Riverfort). The interest rates in respect of the HP Agreement and loan from David Ciclitira are fixed and in respect of the loan from NatWest Bank PLC is calculated in relation to bank Base Rate, there are no early redemption penalties associated with the NatWest Bank PLC loan and the risk is therefore considered to be insignificant.
b. Foreign currency risk
Although the Company is based in the United Kingdom, a significant part of the Group's and Company's operations are overseas, and the operating or functional currency of a large part of the global business is in US Dollars or Euros. As a result, the Group's sterling accounts can be affected by movements in the US Dollar/Sterling and the Euro/Sterling exchange rates.
The foreign assets and liabilities of the Group and Company are closely matched as at 31 December 2020. The table below sets out the carrying amounts of assets and liabilities for the Group in their presentational currency (i.e. Sterling) and a total impact for each 10% fluctuation in exchange rates. Based on the carrying amounts of foreign assets and liabilities as at 31 December 2020, for each 10% fluctuation in exchange rates, net assets are expected to be impacted by GBP16,000 (2019: GBP6,000)
Year ended 31 December 2020
Carrying amount (sterling equivalent) Forex Risk
GBP $ EUR Total (-10%) 10%
'000 '000 '000 GBP'000 GBP'000 GBP'000
Financial assets
Cash 164 3 1 168 - -
Trade and other receivables 331 27 45 404 7 (7)
----- ---- ---- ------- ------- -------
495 30 46 572 7 (7)
----- ---- ---- ------- ------- -------
Financial liabilities
Borrowings 2,045 - - 2,045 - -
Trade payables 349 67 158 574 23 (23)
Other payables 866 - - 866 - -
Lease liabilities 248 - - 248 - -
Other taxation and
social security 924 - - 924 - -
Accruals and deferred
income 1,120 - - 1,120 - -
5,552 67 158 5,777 23 (23)
Net Impact 16 (16)
------- -------
Year ended 31 December 2019
Carrying amount (sterling equivalent) Forex Risk
GBP $ EUR Total (-10%) 10%
'000 '000 '000 GBP'000 GBP'000 GBP'000
Financial assets
Cash 74 1 23 98 2 (2)
Trade and other receivables 2,559 62 186 2,807 25 (25)
----- ---- ---- ------- ------- -------
2,633 63 209 2,905 27 (27)
----- ---- ---- ------- ------- -------
Financial liabilities
Borrowings 995 - - 995 - -
Trade payables 512 164 44 720 (21) 21
Other payables 210 - - 210 - -
Lease liabilities 303 - - 303 - -
Other taxation and
social security 687 - - 687 - -
Accruals and deferred
income 947 - - 947 - -
3,654 164 44 3,862 (21) 21
Net Impact 6 (6)
------- -------
25. Lease liabilities
Group Company
2020 2019 2020 2019
GBP'000 GBP'000 GBP'000 GBP'000
Current 60 79 - -
Non-current 188 224 - -
248 303 - -
-------- -------- -------- --------
In 2019, a right of use asset, being the present value of the operating lease payments over the remaining life of the lease, was recognised. The right of use assets and corresponding lease liability have been calculated using a discount rate of 9%. The depreciation of the assets and interest charge are recognised in the Statement of Comprehensive Income in the year and the buildings maturity analysis of lease commitments at 31 December 2020 is detailed below.
Lease payments relate to leases of property. The Group does not have an option to purchase the leased property at the expiry of the lease period.
Payments recognised as an expense 2020 2019
GBP'000 GBP'000
Minimum lease payments - -
Lease depreciation 62 16
Interest 24 7
-------- --------
Non-cancellable lease commitments 2020 2019
GBP'000 GBP'000
Not later than 1 year 79 80
Later than 1 year and not later than 5 years 219 298
Later than 5 years - -
-------- --------
298 378
-------- --------
26. Deferred tax
2020 2019
GBP'000 GBP'000
At start of year 550 123
Charged to profit or loss 94 427
At end of year 644 550
-------- --------
Due to the availability of UK tax losses, subject to agreement with the HMRC, there is an estimated deferred tax asset of GBP2,648,000 (2019: GBP2,382,000). This is not recognised due to the uncertainty of the timing of future taxable profits against which these losses could be utilised.
27. Share capital
The issued share capital is set out in the table below:
2020 2019
No. of GBP'000 No. of GBP'000
shares shares
Issued and fully paid
Ordinary shares of 1p 108,138,544 1,081 79,500,419 794
Deferred shares of 51.8p 2,047,523 1,061 2,047,523 1,061
Deferred Ordinary shares
of 0.5p 199,831,545 999 199,831,545 999
Deferred B shares of GBP19.60 103,260 2,024 103,260 2,024
-------- --------
Total 5,165 4,878
-------- --------
The changes in the year to 1p Ordinary shares, relating to the various capital transactions during the year were as follows:
2020
Ordinary shares of 1p No. of GBP'000
shares
At start of year 79,500,419 794
Settlement of director fees (RNS Number :
1029A 17 January 2020) 116,667 1
Settlement of advisor fees (RNS Number : 6990J
15 April 2020) 233,333 2
Settlement of salary and contractor fees (RNS
Number : 9396L 05 May 2020) 1,196,866 12
Share Placing (RNS Number : 1520R 26 June
2020) 4,000,000 40
Loan conversion (RNS Number : 1520R 26 June
2020) 2,050,000 21
Settlement of salary and contractor fees (RNS
Number : 5485T 21 July 2020) 835,182 8
Settlement of salary and contractor fees (RNS
Number : 9339Z 24 September 2020) 1,396,077 14
Share placing and subscription (RNS Number
: 3562H 03 December 2020) 18,810,000 189
At end of year 108,138,544 1,081
------------ --------
2019
Ordinary shares of 1p No. of GBP'000
shares
At start of year 67,094,595 671
Share placing (RNS Number : 5610P 11 February
2019) 2,084,616 21
Settlement of Ranjit Murugason fees (RNS Number
: 5610P 11 February 2019) 69,230 1
Settlement of Ranjit Murugason fees (RNS Number
: 8050U 02 April 2019) 153,846 2
Share subscription (RNS Number : 6771A 31
May 2019) 1,038,457 10
Share subscription (RNS Number : 1083K 23 46,152 -
August 2019)
Share placing (RNS Number : 4454U 25 November
2019) 2,346,856 23
Share subscription (ESA) December 2019 (RNS
Number : 9028W 16 December 2019) 6,666,667 66
79,500,419 794
----------- --------
The number of additional shares authorised for issue is 30,104,523 (2019: 25,947,917), on 21 May 2021 the members of the Company in general meeting authorised the issue of up to 55,000,900 additional shares of which 36,000,000 have been issued (RNS Number : 4906Z 21 May 2021).
Deferred shares
The Company has 2,047,523 Deferred shares of 51.8p each and 199,831,545 Deferred Ordinary shares of 0.5p each (together the "Deferred shares") in issue. The Company also has 103,260 Deferred B shares in issue.
The Deferred shares have the following rights and restrictions. They shall:
a. Not entitle their holders to receive any dividend or other distribution;
b. Not entitle their holders to receive notice of or to attend, speak or vote at any General Meeting of the Company by virtue of or in respect of their holding of such Deferred shares and;
c. Entitle their holders on a return of assets on a winding-up of the Company or otherwise only to the repayment of the capital paid up on such Deferred shares and only after repayment of the capital paid up on each Ordinary share in the capital of the Company and the payment of a further GBP100,000 on each such Ordinary share.
The holders of the Deferred shares shall not be entitled to any further participation in the assets or profits of the Company. Notwithstanding any other provision of these Articles and unless specifically required by the provisions of the Act, the Company shall not be required to issue any certificates in respect of the Deferred shares. The Company shall have irrevocable authority at any time:
a. to appoint a person on behalf of any holder of Deferred shares to enter into an agreement to transfer, and to execute a transfer of, the Deferred shares, for no consideration, to such person (whether or not an officer of the Company) as the Directors may determine as the custodian thereof;
b. to purchase all the Deferred shares then in issue in consideration of an aggregate payment of one penny for all of such shares then redeemed and upon giving 28 days' prior notice to the holders of Deferred shares as to be redeemed fixing a time and place for redemption; and
c. in the event of any transfer, purchase or redemption to retain any share certificate relating to such shares. If any Deferred shares are purchased or redeemed as aforesaid, the relevant amount of authorised but unissued share capital arising may be redesignated by the Directors as Ordinary share capital.
Neither the passing by the Company of any special resolution for the cancellation of the Deferred shares for no consideration by means of a reduction of capital requiring the confirmation of the Court nor the obtaining by the Company nor the making by the Court of any Order confirming any such 103 reduction of capital nor the becoming effective of any such Order shall constitute a variation, modification or abrogation of the rights attaching to the Deferred shares and accordingly the Deferred shares may at any time be cancelled for no consideration by means of a reduction of capital effected in accordance with the Act without sanction or consent on the part of the holders of the Deferred shares.
28. Share premium
2020 2019
GBP'000 GBP'000
At start of year 23,480 18,470
Premium arising on issue of equity shares 840 3,932
Shares issued on acquisition of subsidiary and novation of contracts 135 -
Debt to share conversion 633 1,181
Share issue costs (84) (103)
-------- --------
At end of year 25,004 23,480
-------- --------
29. Acquisitions
In December 2020 the Company acquired the entire issued share capital of Live Company Sports and Entertainment Limited together with its wholly owned subsidiary Live Company Sports and Entertainment (Pty) Limited and 50% interest in K-Pop Europa Limited for GBP650,000 and purchased certain contracts from World Sport South Africa (Pty) Limited for GBP500,000 to create a new Sports and Entertainment division (RNS Number : 3562H 03 December 2020). Live Company Sports and Entertainment Limited was 100% owned by David Ciclitira prior to the acquisition.
In December 2020 the Company acquired the entire issued share capital of E Movement Holdings Ltd for GBP300,000 (RNS Number : 3562H 03 December 2020). E Movement Holdings Ltd was 33.34% owned by David Ciclitira prior to the acquisition.
These transactions have been treated as the acquisition of contracts as detailed in Note 2.1.
Acquisitions Purchase price
GBP'000
Live Company Sports and Entertainment
Limited 650
Live Company Sports and Entertainment -
Pty Limited
K-Pop Europa Limited (JV) -
Novation of contracts 500
E Movement Holdings Ltd 300
---------------
1,450
---------------
Satisfied by:
Cash 50
Deferred consideration 800
Equity instruments (6,000,000 Ordinary shares
of parent Company) 600
---------------
1,450
---------------
The 600,000 Ordinary shares of the parent Company issued in consideration of the acquisition of LCSE and the novation of contracts are included in the share placing and subscription announced in December 2020 as detailed in Note 27.
The Company made no acquisitions in 2019.
30. Share option reserve
2020 2019
GBP'000 GBP'000
At start of year 218 -
Share option charge 222 167
Warrant charge 56 51
At end of year 496 218
-------- --------
The Group adopted a share option scheme on 2 April 2019 for certain directors and senior management. Options are generally exercisable at a price equal to the market price of the Plc shares on the day immediately prior to the date of the grant. Options are forfeited if the employee leaves the Group before the options vest.
The Share Option Plan provides for the grant of both tax-approved Enterprise Management Incentives (EMI) Options and unapproved options.
No options were issued in 2020 (2019: 3,086,346 at an average exercise price of 65p).
The inputs into the share option pricing model for the options granted in April 2019 are as
follows:
Weighted average exercise price 65p Expected volatility 63% Expected life 3 years Risk free interest rate 1.6% Expected dividends 0.00
The charge for the year ended 31 December 2020 for the options issued in April 2019 totals GBP222,200 (2019: GBP166,700).
Details of the share options outstanding during the year are as follows. There are no share options exercisable at the balance sheet date.
2020 2019
Weighted Weighted
average average
exercise exercise
Number price (p) Number price (p)
Outstanding at the beginning
of the year 3,086,346 65 - -
Granted during the year - - 3,086,346 65
Forfeited during the year - - - -
Exercised during the year - - - -
Outstanding at the end of
the year 3,086,346 65 3,086,346 65
Warrants
75,000 (2019: 282,018) warrants were issued during the year at a weighted average exercise price of 15p** (2019: 74.66p).
31 December 2020 31 December 2019
Share warrants Number Exercise Number Exercise
price (p) price (p)
Investor (exercisable up
to 17 October 2022) 356,923 38.79p 356,923 38.79p
Investor (exercisable up
to 16 December 2023) 232,018 38.79p 232,018 38.79p
Adviser (exercisable up to
25 February 2021) 50,000 80.00p* 50,000 80.00p
Adviser (exercisable up to
25 June 2022) 75,000 15.00p**
*In June 2020 it was proposed to reprice these to 15p (RNS Number : 1520R 26 June 2020).
**In December 2020 it was proposed to reprice these to 10p (RNS Number : 3562H 03 December 2020).
The inputs into the warrant pricing model for the warrants issued in the year are:
Weighted average exercise price 15p Expected volatility 79% Expected life 2 years Risk free interest rate 1.1% Expected dividends 0.00
The charge for the year ended 31 December 2020 for the warrants in issue totals GBP55,500 (2019: GBP51,100).
A further 16,810,000 (2019: 3,903,840) warrants were issued to investors as part of an equity raise and are therefore outside the scope of IFRS 2 "Share-based payment" and consequently there is no share-based payment charge in respect of these warrants.
31. Capital management
The Group's objectives when managing capital are to safeguard the Group's ability to continue as a going concern, so that it can continue to provide returns to shareholders and benefits for other stakeholders. The Group had net assets of GBP5.8m at 31 December 2020 (2019: GBP13.7m). The Group's capital management strategy is to retain sufficient working capital for day to day operating requirements and to ensure sufficient funding is available to meet commitments as they fall due and to support growth. There are no externally imposed capital requirements.
2020 2019
GBP'000 GBP'000
Loan facility (2,045) (995)
-------- --------
Total debt (2,045) (995)
-------- --------
Cash 168 98
-------- --------
Net debt (1,877) (897)
-------- --------
In order to maintain or adjust the capital structure the Group may issue new shares or sell assets to reduce debt.
32. Related party transactions
Details of the Directors' remuneration and consultancy fees are disclosed in Note 9.
David Ciclitira
David Ciclitira injected funds into the Company 2020 2019
during the year as follows:
GBP'000 GBP'000
Fees settled in shares (RNS Number : 9396L 28 -
05 May 2020)
Loan conversion (RNS Number : 1520R 26 June 205 -
2020)
Acquisition of LCSE settled in shares (RNS 450 -
Number : 3562H 03 December 2020)
Purchase of 400,000 Ordinary shares of 1p
each - 260
Purchase of Venturi Formula E Car - 25
-------- --------
683 285
-------- --------
Loan advanced
Loan facility (RNS Number : 6990J 15 April 500 -
2020).
Total funds injected 1,183 285
-------- --------
David Ciclitira received payments during the 2020 2019
year as set out below:
GBP'000 GBP'000
Business expenses and healthcare costs. 13 26
Rental arrangements (London and Italy) (RNS
Number : 0451O 30 September 2019). - 33
Fee in relation to the settlement of James
Golf creditors (Admission Document) - 123
Rental arrangements for use of Venturi Formula 17 -
E Car as described in Note 33 to the annual
report for the year ended 31 December 2019.
Fees and interest in relation to the provision 101 -
of loan facility detailed in Note 22.
Fees in relation to providing personal guarantee 28 -
(RNS Number : 2514W 17 August 2020)
Consideration for the purchase of 100% of 450 -
the issued share capital of LCSE (RNS Number
: 3562H 03 December 2020)*
Consideration for the purchase of 33% of the - -
issued share capital of E Movement Holdings
Ltd (RNS Number : 3562H 03 December 2020)**
Fee in relation to the assumption of historic 29 -
liabilities (RNS Number : 6990J 15 April 2020)
-------- --------
638 182
-------- --------
Loan repaid
Loan conversion (RNS Number : 1520R 26 June 205 -
2020)
Repayment of short-term loans as described
in Note 31 to the annual report for the year
ended 31 December 2018 - 126
-------- --------
205 126
-------- --------
Total payments received 843 308
-------- --------
*GBP450,000 of the total consideration for the purchase of Live Company Sports and Entertainment Limited was settled by the issue of 4,500,000 Ordinary shares in the parent Company, the balance of GBP200,000 has been deferred and will be settled by the issue of a further 2,000,000 shares based on certain criteria.
**The total consideration of GBP100,000 for the purchase of David Ciclitira's 33.34% holding in E Movement Holdings Ltd has been deferred and will be settled in cash based on certain criteria.
Unpaid balances due to related parties at 2020 2019
31 December
GBP'000 GBP'000
David Ciclitira* 318 7
Serenella Ciclitira 8 -
Ranjit Murugason 20 30
Bryan Lawrie 11 12
Trudy Norris-Grey (15) 18
Mark Freebairn 10 5
Simon Horgan 10 -
362 72
-------- --------
*Includes total deferred consideration of GBP300,000 in relation to the acquisition of David Ciclitira's interest in LCSE and E Movement Holdings Ltd, and the outstanding loan balance of GBP295,000 as detailed in Note 22 and the credit note as detailed in Note 9.
33. Equity Share Arrangement
In December 2019, the Company entered into a subscription agreement with YA II PN, Limited. ("YA II") and RiverFort Global Opportunities PCC Limited ("RiverFort") together the "Investors" whereby the Investors agreed to make an equity investment of GBP2m, before expenses ,through the subscription for, and issue of 6,666,667 new Ordinary shares of 1 pence each in the capital of the Company at a price of 30p per share. Under an equity sharing agreement also entered into by the Company with the Investors (the "ESA"), an amount equal to the gross proceeds of the Subscription following its completion, will then be returned by the Company to the Investors (the "ESA Payment"), with the Company to receive back the ESA Payment, subject to certain pricing adjustments on a pro rata monthly basis.
In August 2020 (RNS Number : 2514W 17 August 2020) the Group entered into a GBP1,500,000 CBILS borrowing agreement with Close Leasing Limited, the proceeds from the facility were used to repay the outstanding YA II and RiverFort borrowing and to terminate the ESA agreement.
In addition to an early termination fee of GBP143,000 payable by the Group, Live Company Group EBT Limited purchased 5,726,480 shares previously held by YA II and RiverFort (representing 6.51%. of the Company's issued share capital at the time) into trust, at a cost of GBP57,000.
These payments together with the Group's expected share of the ESA Payment (GBP2,000,000 at the time of the agreement and included in non-current receivables in the Groups unaudited consolidated statement of financial position at 30 June 2020) which following the termination will no longer be receivable will be considered part of the consideration for the share purchase at a group level and is included in the Group retained earnings in the Consolidated Statement of Financial Position.
34. Subsidiaries
At 31 December 2020, the Company had the following (direct and indirect) subsidiaries:
Held directly Company number Place of % owned Principal activities
incorporation
Brick Live Group
Limited 10151705 UK 100% Holding Company
Brick Live Touring
Limited 11253539 UK 100% Dormant
Parallel Live Group Holding Company
Limited 09932658 UK 100% US activities
Bright Bricks 2020
Limited 12333294 UK 100% Dormant
Championship (Singapore) 201427355K Singapore 95% Dormant
Pte Limited
Live Company Sports
and Entertainment
Limited 12328268 UK 100% Holding Company
E Movement Holdings
Ltd 12502990 UK 100% Holding Company
Held indirectly
Sales of products,
Brick Live International licensed events
Limited 10257756 UK 100% and zoos
Brick Live Far East Dormant and being
Limited 10308158 UK 100% dissolved
Owner of Associate
Brick Live Far East investment in
Limited 2460460 Hong Kong 100% China
Parallel Live (NY)
LLC 6339763 USA 100% Dormant
Specialist production
Bright Bricks Limited 07227540 UK 100% company
Bright Bricks Consumer Dormant and dissolved
Limited 10653625 UK 100% on 16 March 2021
E Movement Holdings 2021/354354/07 South Africa 100% Formula E events
(Pty) Limited
Live Company Sports 2020/765082/07 South Africa 100% Sports and entertainment
and Entertainment events
(Pty) Limited
The following subsidiaries were dissolved in the year:
Held directly Company number Place of % owned Principal activities
incorporation
Held indirectly
Brick Live Hong Kong
Limited 2460469 Hong Kong 100% Dissolved
Parallel Media Group 201131009R Singapore 100% Dissolved
Asia
The registered office of the subsidiaries incorporated is England and Wales is 3 Park Court Pyrford Road, West Byfleet, Surrey, KT14 6SD.
The registered office of the overseas subsidiaries are as follows:-
Championship (Singapore) Pte Limited, 62 Neil Road, Singapore (088833).
Brick Live Far East Limited, RM 1307A 13/F, Two Harbourfront, 22 Tak Fung Street, Hughom, Hong Kong.
E Movement Holdings (Pty) Limited, 9 Viscount Crescent, Baronetcy Estate, Plattekloof, Western Cape, 7500, South Africa.
Live Company Sports and Entertainment (Pty) Limited, Noland House, River Park, Mowbray, Western Cape, South Africa.
35. Post balance sheet events
START Art
As announced on 4 May 2021 (RNS Number : 3348X 04 May 2021) the Company has acquired a non controlling minority interest of 16.3% in Start Art Global Limited ('START Art'), an online art and digital art sales and news platform, for GBP1,000,000 funded from the proceeds of a GBP1,500,000 share placing completed on 24 May 2021. Prior to the transaction 100% of the issued share capital of START Art was owned by David Ciclitira and Ranjit Murugason.
Loan from David Ciclitira
As announced on 1 June 2021 (RNS Number : 4199A 01 June 2021) the terms of the loan advanced by David Ciclitira to Brick Live International Limited on 15 April 2020 have been varied to extend the term of the loan and convert an additional GBP30,000 to equity at 5p per share. Following the conversion, and the offset of a further GBP178,000 against the credit note detailed in Note 9, a balance of GBP90,823 remained outstanding.
Warrant repricing
As announced on 28 June 2020 (RNS Number : 1520R 26 June 2020) in accordance with the terms of the warrant instrument and following the passing of special resolution 4 at the general meeting held 29 January 2021 and special resolution 5 at the general meeting held 21 May 2021:
-- 3,953,840 warrants with an exercise price of 80p were repriced at an exercise price of 15p; and,
-- 4,075,000 warrants with an exercise price of 15p were repriced at an exercise price of 10p.
Note to the announcement
In accordance with section 435 of the Companies Act 2006, the directors advise that the financial information set out in this announcement does not constitute the Group's statutory financial statements for the year ended 31 December 2020 or 2019 but is derived from these financial statements. The financial statements for the year ended 31 December 2019 have been delivered to the Registrar of Companies. The financial statements for the year ended 31 December 2020 have been prepared in accordance with International Financial Reporting Standards as adopted by the European Union and will be forwarded to the Registrar of Companies following the Company's Annual General Meeting. The Auditors have reported on these financial statements; their reports were unqualified and did not contain statements under Section 498(2) or (3) of the Companies Act 2006.
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