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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Star Energy Group Plc | LSE:STAR | London | Ordinary Share | GB00BZ042C28 | ORD 0.002P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.075 | 0.66% | 11.525 | 11.25 | 11.80 | 11.80 | 10.70 | 11.80 | 456,617 | 16:35:20 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Computers & Software-whsl | 4.04M | -1.01M | -0.0079 | -3.80 | 3.84M |
From Apr 2019 to Apr 2024
TIDMSTAR
RNS Number : 0607Z
Starcom PLC
29 August 2018
29 August 2018
Starcom Plc
("Starcom" or the "Company")
Interim Results
Starcom (AIM: STAR) which specialises in the development of wireless solutions for the remote tracking, monitoring and protection of a variety of assets announces its interim results for the six months ended 30 June 2018 ("the Period").
Highlights
-- Revenues for the Period were $3.1m (H1 2017: $1.9m), an increase of 61% -- Revenues derived from a higher quality mix of products and clients -- Gross profits were $1.2m (H1 2017: $0.9m), an increase of 36% -- Gross margin rose to 40% compared with 38% for full year 2017 -- EBITDA loss before share option provisions reduced to $40,000 (H1 2017: loss $283,000) -- Recurring SAS revenues were $890,000 (H1 2017: $775,000), an increase of 15% -- Reliance on low-margin Helios products reduced to 34% (FY 2017: 58%)
Avi Hartmann, CEO of Starcom, commented,
"These improved results demonstrate that the Company is now beginning to reap the rewards of its years of investment in its superior telematics and tracking technology. We are seeing more significant clients now adopting our systems and many more are in discussion with us on future projects. We are very focused on developing these new relationships which we expect to drive our growth in the next few years."
or further information, please contact:
Starcom Plc
Michael Rosenberg, Chairman 07785 727 595
Avi Hartmann, CEO +972 5447 35663
Northland Capital Partners Limited (Nominated Adviser and Broker) 020 3861 6625
Matthew Johnson / EdrdHutton (Corporate Finance)
Rob Rees (Sales and Broking)
Peterhouse Capital Limited (Joint Broker) 020 7469 0930
Lucy Williams / Charles Goodfellow / Eran Zucker
Leander PR (Financial PR) 07795 168 157
Christian Taylor-Wilkinson
Chairman's Statement
As foreshadowed in the trading update published on 30 July 2018, Group revenues in the Period showed a major increase of approximately 61% over the comparable period in 2017. Gross margin improved slightly to 40% and the EBITDA loss before share option provisions was substantially reduced to $40,000 (H1 2017: $283,000).
The Group continues to focus on developing strategic and close alliances with larger, world class client companies to drive growth.
In September 2017 it was announced that the Company had entered into a strategic collaboration agreement with a major European Industrial Group. We are now able to disclose that this entity is Bosch Connected Devices and Solutions GMBH ("Bosch"), a subsidiary of Robert Bosch GmbH. The Company has a good ongoing relationship with Bosch and is working closely with their team with a view to further orders in the near future.
Two other new strategic clients, CropX (irrigation control) and WIMC (cargo protection to reduce insurance costs), contributed significantly to revenues in the Period and we would expect this to continue going forward.
The spectrum of opportunities available in the market for Starcom's products is large and expanding and we are now working in collaboration with a number of companies to help them solve the unique issues they face by utilising our technology. Examples mentioned in our latest update include the remote factory monitoring of electric motorbike performance (initial orders have already been received) and the quality assurance of concrete deliveries to construction sites, through placing highly specialised monitors within the cement mixing vehicles.
This market opportunity is being further enhanced by our proven capability to make the Internet of Things ("IoT") work for our clients. Our project with CropX is a good example - irrigation control devices become components in an IoT based solution enabling CropX's clients to exploit rich field data to achieve better agricultural productivity. We are moving fast in applying IoT technology to other areas including machinery, livestock and tankers. Our R&D team is also currently exploring opportunities presented by clients and partners to integrate Starcom's technologies into the rapidly-growing Blockchain application world. In the cargo tracking area for example, end customers can, through the use of blockchain, receive authenticated and highly secure data regarding the path a shipment has taken, including reporting on the various conditions along the way, such as loading, unloading, change in temperature, humidity levels, etc.
Leveraging its ongoing technological advancements, the Company has been successful in gradually reducing the dominance of the standard Helios tracking products which have, in recent years, accounted for over 90% of hardware sales. These older and basic products suffer from a highly competitive environment and therefore show a much lower gross margin (which is moderated somewhat by the SAS revenues which the Helios units, like all other products, generate as they are connected to Starcom's central cloud-based tracking software). In 2017 we reduced Helios to 58% of total hardware sales and that percentage has subsequently dropped to 34% in the Period.
The newer and more sophisticated products we have been developing in recent years include the Watchlock, which contributed 23% to hardware sales in the Period, compared with 6% in the whole of 2017. We are confident that, once the new Bluetooth-enabled version is launched towards the end of the year, we expect further growth in this product. Kylos sales were 24% of hardware sales in the Period (FY 2017: 16%). The Tetis, for shipping containers, contributed 19% (FY 2017: 20%) in the Period.
The high margin SAS revenues showed a solid increase of 15% in the Period to $890,000 (H1 2017: $775,000) due to the increase in the number of units live on the system. We expect overall gross margins to continue to improve as the revenue mix and the SAS contribution improve.
FINANCIAL REPORT
Group revenues for the Period were $3.1m, compared with $1.9m for the six months ended 30 June 2017, an increase of 61%.
The gross margin for the Period was 40%, compared with 38% for full year 2017.
Despite achieving savings in rent and office expenses items, total operating expenditure of $1.7m increased by some 18% mainly due to non-cash expenses such as depreciation and share option provisions.
The operating loss in the Period decreased to $0.51m compared with an operating loss of $0.57m for the six months ended 30 June 2017, a reduction of 10%.
The Group benefitted from the strength of the USD, which resulted in a $0.1m exchange rate gain.
The Group balance sheet showed an increase in trade receivables to $1.44m, compared with $1m as at 30 June 2017, due to the increase in revenues for the Period compared with H1 2017.
Group inventories at the Period end were $2.3m, compared to $2.0m as at 30 June 2017.
Trade payables at the Period end were $1.8m, compared with $2.1m as at 30 June 2017, showing a decrease of $0.3m.
Net cash used in operating activities in the Period was $0.3m, compared with $0.17m for the six months ended 30 June 2017.
During the Period, it was decided to further rationalise extraneous operations and therefore the Company closed its office in Florida, as it was found that selling directly to clients in the USA from Israel proved more cost effective. This caused a onetime loss of $34,000 for the Period.
Since the Period end, the Company has negotiated increased bank facilities with a major bank in Israel for the amount of 2.4m shekels ($0.66m) subject to normal bank covenants and conditions. These new facilities demonstrate the confidence of the bank in our future plans.
OUTLOOK
2018's first half revenues have already exceeded half of 2017's full year revenues which were weighted, as in previous years, towards the second half of the year. With this good start, and as we engage with an unprecedented number of higher quality new client and revenue opportunities, we expect that revenues for 2018 should significantly exceed those for 2017 and that full year 2018 will show a positive EBITDA before share option provisions. More importantly, we have established a stronger foundation of improved client and product mix to enable growth to continue into 2019.
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
U.S. Dollars in thousands
Hot Features
Premium
June 30 December
31
Note 2018 2017 2017
--------- --------- --------
Unaudited Unaudited Audited
--------- --------- --------
ASSETS
NON-CURRENT ASSETS:
Property, plant and equipment, net 502 343 303
Intangible assets, net 32,376 2,508 2,457
Income Tax Authorities 46 43 44
Total Non-Current Assets 2,924 2,894 2,804
----- ----- -----
CURRENT ASSETS:
Inventories 2,329 1,993 1,485
Trade receivables (net of allowance
for doubtful accounts of $39, $137
and $48 thousand as of June 30, 2018
and 2017 and December 31,2017) 1,443 1,011 1,772
Other receivables 129 36 101
Short-term deposit 54 53 55
Cash and cash equivalents 178 281 93
Total Current Assets 4,133 3,374 3,506
----- ----- -----
TOTAL ASSETS 7,057 6,268 6,310
===== ===== =====
LIABILITIES AND EQUITY
EQUITY
3,738 2,752 3,032
----- ---------------- -----
NON-CURRENT LIABILITIES:
Long-term loans from banks 101 302 155
Leasehold Liabilities 84 - -
----- ---------------- -----
Total Non-Current Liabilities 185 302 155
CURRENT LIABILITIES:
Short-term bank credit 44 108 227
Short-term loans and current maturities
of long-term loans 232 381 279
Convertible debentures - 102 131
Trade payables 1,819 2,101 1,522
Shareholders and related parties 5 714 288 713
Other payables 219 234 251
Leasehold Liabilities 106 - -
Total Current Liabilities 3,028 3,214 3,123
----- ---------------- -----
TOTAL LIABILITIES AND EQUITY 7,057 6,268 6,310
===== ================ =====
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
U.S. Dollars in thousands
Year Ended
Six Months Ended June December
30 31
Note 2018 2017 2017
--------- ---------------- ----------
Unaudited Unaudited Audited
--------- ---------------- ----------
Revenues 3,092 1,922 5,440
Cost of sales (1,864) (1,019) (3,360)
---------
Gross profit 1,228 903 2,080
Operating expenses:
Research and development, net (124) (134) (237)
Selling and marketing (292) (264) (558)
General and administrative (1,288) (1,095) (2,196)
Other income (expenses) (34) 22 22
--------- ---------------- ----------
(1,738) (1,471) (2,969)
--------- ---------------- ----------
Operating loss (510) (568) (889)
Net finance income (expenses) 6 33 (357) (461)
--------- ---------------- ----------
Total comprehensive loss for
the period (477) (925) (1,350)
========= ================ ==========
Loss per share:
Basic and diluted loss per
share (in dollars) 4 (0.002) (0.006) (0.007)
========= ================ ==========
INTERIM CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
U.S. Dollars in thousands
Capital
Share Reserve
Capital Premium Capital for Share-based Accumulated
* on Shares Reserve payment Loss Total
------------ ----------- -------- ----------------- ------------------ --------
(Unaudited)
Balance- January
1,
2018 - 9,796 89 602 (7,455) 3,032
Issue of share
capital,
net of expenses
- see
Notes 1(a)3 -
1(a)5 - 1,049 - - - 1,049
Share based
payment
- Note 4 - - - 134 - 134
Expiry options
and
warrants - Note
4 - 135 - (135) - -
Comprehensive
loss
for the period - - - - (477) (477)
-----------------
Balance- June 30,
2018 - 10,980 89 601 (7,918) 3,738
============= =========== ======== ================= ================== ========
(Unaudited)
Balance- January
1,
2017 - 8,332 89 428 (6,105) 2,744
Issue of share
capital,
net of expenses - 912 - - - 912
Issue of
convertible
debentures - - 2 - - 2
Share based
payment - - - 19 - 19
Comprehensive
loss
for the period - - - - (925) (925)
-----------------
Balance- June 30,
2017 - 9,244 91 447 (7,030) 2,752
============= =========== ======== ================= ================== ========
(Audited)
Balance- January
1,
2017 - 8,332 89 428 (6,105) 2,744
Proceeds from
issued
share capital,
net
of expenses - 1,464 - - - 1,464
Share based
payment - - - 174 - 174
Comprehensive
loss
for the year - - - - (1,350) (1,350)
-----------------
Balance- December
31,
2017 - 9,796 89 602 (7,455) 3,032
============= =========== ======== ================= ================== ========
* An amount less than one thousand.
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
U.S. Dollars in thousands
Six Months Ended Year Ended
June 30 December
31
2018 2017 2017
------------------------- ---------------------- -----------------
CASH FLOWS FROM OPERATING ACTIVITIES: Unaudited Unaudited Audited
------------------------- ---------------------- -----------------
Comprehensive loss (477) (925) (1,350)
Adjustments to reconcile net loss to
net cash used in operating activities:
Depreciation and amortization 303 267 510
Interest expense and exchange rate
differences (50) 89 92
Equity settled option-based payment
expense 134 19 174
Capital loss (gain) 33 (19) (19)
Changes in assets and liabilities:
Increase in inventories (844) (737) (229)
Decrease (Increase) in trade receivables 329 380 (381)
Decrease (Increase) in other receivables (28) 29 (36)
Increase in Income Tax Authorities (3) (9) (10)
Increase in trade payables 297 676 96
Increase (Decrease) in other payables (32) 56 73
Net cash used in operating activities (338) (174) (1,080)
------------------------- ---------------------- -----------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment (46) (150) (144)
Proceeds from sales of property, plant
and equipment - 62 61
Increase (Decrease) in short-term deposits 1 4 2
Purchase of intangible assets (136) (107) (264)
Net cash used in investing activities (181) (191) (345)
------------------------- ---------------------- -----------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of short-term bank credit,
net (183) (40) (38)
Proceeds from (Repayment of) a convertible
debenture, net (131) 92 131
Repayment of Short-term loans from banks - (31) -
Receipt of long-term loans 97 46 46
Proceeds from shareholders and related
parties, net 1 14 406
Repayment of Leasehold liability (49)
Repayment of long-term loans (180) (216) (357)
Consideration from issue of shares 1,049 746 1,295
------------------------- ---------------------- -----------------
Net cash provided by financing activities 604 611 1,483
------------------------- ---------------------- -----------------
Increase in cash and cash equivalents 85 246 58
Cash and cash equivalents at the beginning
of the period 93 35 35
------------------------- ---------------------- -----------------
Cash and cash equivalents at the end
of the period 178 281 93
========================= ====================== =================
Appendix A - Additional Information
Interest paid during the period (25) (46) (101)
========================= ====================== =================
Appendix B - Non-cash financing activities
Issuance of shares to related parties
in payment of salaries from current periods - 100 100
===== ===== =====
Issuance of shares to supplier in payment
of partial debt - 70 69
===== ===== =====
Conversion to shares of convertible debentures - - -
and unsecured loans
===== ===== =====
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
U.S. Dollars in thousands
NOTE 1 GENERAL INFORMATION
-
a. The Reporting Entity
1. Starcom plc ("the Company") was incorporated in
Jersey on November 28, 2012. The Group specializes
in easy-to-use practical wireless solutions that
combine advanced technology, telecommunications and
digital data for the protection and management of
people, fleets of vehicles, containers and assets
and engages in production, marketing, distribution,
research and development of G.P.S. systems.
The Company fully owns Starcom G.P.S. Systems Ltd.,
an Israeli company that engages in the same field,
and Starcom Systems Limited, a company in Jersey.
During the reported period, Starcom Systems America
Inc. terminated its activity, which caused a loss
of $34 thousand to the group results.
The Company's shares are admitted for trading on
London's Stock Exchange Alternative Investment Market
("AIM").
Address of the official Company office in Israel
of Starcom G.P.S. Systems Ltd. is:
16 Hata'as St., Kfar-Saba, Israel.
Address of the Company's registered office in Jersey
of Starcom Systems Limited is:
Forum 4, Grenville Street, St Helier, Jersey, Channel
Islands, JE4 8TQ
2. During January 2018 the Company raised GBP 315
($439) thousand before expenses, through a placing
of 14,000,000 new Ordinary Shares of no par value
at a price of 2.25p per Placing Share.
3. During May 2018 the Company raised GBP 365 ($486)
thousand before expenses, through a placing of 14,600,000
new Ordinary Shares of no par value at a price of
2.5p per Placing Share.
4. On April 2018 the company granted its senior management
and directors' options to subscribe for 10,500,000
new Ordinary Shares at 3.25p per share.
The Options vest as to 50 per cent. one year after
grant and, as to the balance, two years after grant,
except for the options granted to the Company's CFO,
which vest over three years as to one third at the
end of each respective year. Any unexercised options
expire at the end of 10 years from grant.
5. During the reported period, 4,440,000 warrants
were exercised into Ordinary Shares in consideration
of GBP111 ($155) thousand before expenses. The remaining
4,226,667 warrants expired - see also note 4.
b. Definitions in these financial statements:
1. International Financial Reporting Standards (hereinafter:
"IFRS") - Standards and interpretations adopted by
the International Accounting Standards Board (hereafter:
"IASB") that include international financial reporting
standards (IFRS) and international accounting standards
(IAS), with the addition of interpretations to these
Standards as determined by the International Financial
Reporting Interpretations Committee (IFRIC) or interpretations
determined by the Standards Interpretation Committee
(SIC), respectively.
2. The Company - Starcom Plc.
3. The subsidiaries - Starcom G.P.S. Systems Ltd. And
Starcom Systems Limited.
4. Starcom Jersey - Starcom Systems Limited.
5. Starcom Israel - Starcom G.P.S. Systems Ltd.
6. The Group - Starcom Plc. and the Subsidiaries.
7. Related party - As determined by International Accounting
Standard No. 24 in regard to related parties.
NOTE 2 - BASIS OF PREPARATION AND CHANGE IN THE GROUP'S ACCOUNTING
POLICIES
a. Basis of preparation
b. The interim consolidated financial statements have been
prepared in accordance with generally accepted accounting
principles for the preparation of financial statements
for interim periods, as prescribed in International Accounting
Standard No. 34 ("Interim Financial Reporting").
The interim consolidated financial information should
be read in conjunction with the annual financial statements
as of December 31, 2017 and for the year ended on that
date and with the notes thereto.
The significant accounting policies applied in the annual
financial statements of the Company as of December 31,
2017 are applied consistently in these interim consolidated
financial statements.
Use of estimates and judgments
The preparation of financial statements in conformity
with IFRS requires management of the Company to make
judgments, estimates and assumptions that affect the
application of accounting policies and the reported
amounts of assets, liabilities, income and expenses.
Actual results may differ from these estimates.
The judgment of management, when implementing the Group
accounting policies and the basic assumptions utilized
in the estimates that are bound up in uncertainties
are consistent with those that were utilized to prepare
the annual financial statements.
c. New standards, interpretations and amendments adopted
by the Group
The accounting policies adopted in the preparation of
the interim condensed consolidated financial statements
are consistent with those followed in the preparation
of the Group's annual consolidated financial statements
for the year ended 31 December 2017, except for the adoption
of new standards effective as of 1 January 2018.
The Group has early adopted IFRS 16 as follows:
The Group has applied IFRS 16 using the modified retrospective
approach and therefore the comparative information has
not been restated and continues to be reported under
IAS 17 and IFRIC 4. The details of accounting policies
under IAS 17 and IFRIC 4 are disclosed separately if
they are different from those under IFRS 16 and the impact
of changes is disclosed in Note 3.
Significant accounting policy
Policy applicable from 1 January 2018:
At inception of a contract, the Group assesses whether
a contract is, or contains, a lease. A contract is, or
contains, a lease if the contract conveys the right to
control the use of an identified asset for a period of
time in exchange for consideration. To assess whether
a contract conveys the right to control the use of an
identified asset, the Group assesses whether:
* the contract involves the use of an identified asset
- this may be specified explicitly or implicitly and
should be physically distinct or represent
substantially all of the capacity of a physically
distinct asset. If the supplier has a substantive
substitution right, then the asset is not identified;
* the Group has the right to obtain substantially all
of the economic benefits from use of the asset
throughout the period of use; and
* the Group has the right to direct the use of the
asset. The Group has this right when it has the
decision-making rights that are most relevant to
changing how and for what purpose the asset is used.
In rare cases where the decision about how and for
what purpose the asset is used is predetermined, the
Group has the right to direct the use of the asset if
either:
* the Group has the right to operate the asset; or
* the Group designed the asset in a way that
predetermines how and for what purpose it will be
used.
This policy is applied to contracts entered into, or
changed, on or after 1 January 2018.
At inception or on reassessment of a contract that contains
a lease component, the Group
allocates the consideration in the contract to each lease
component on the basis of their relative stand-alone
prices. However, for the leases of land and buildings
in which it is a lessee, the Group has elected not to
separate non-lease components and account for the lease
and non-lease components as a single lease component.
Policy applicable before 1 January 2018
For contracts entered into before 1 January 2018, the
Group determined whether the arrangement was or contained
a lease based on the assessment of whether:
* fulfilment of the arrangement was dependent on the
use of a specific asset or assets; and
* the arrangement had conveyed a right to use the
asset. An arrangement conveyed the right to use the
asset if one of the following was met:
* the purchaser had the ability or right to operate the
asset while obtaining or controlling more than an
insignificant amount of the output;
* the purchaser had the ability or right to control
physical access to the asset while obtaining or
controlling more than an insignificant amount of the
output; or
* facts and circumstances indicated that it was remote
that other parties would take more
than an insignificant amount of the output, and the price
per unit was neither fixed per unit of output nor equal
to the current market price per unit of output.
As a lessee
The Group recognizes a right-of-use asset and a lease
liability at the lease commencement
date. The right-of-use asset is initially measured at
cost, which comprises the initial amount
of the lease liability adjusted for any lease payments
made at or before the commencement
date, plus any initial direct costs incurred and an estimate
of costs to dismantle and remove the underlying asset
or to restore the underlying asset or the site on which
it is located, less any lease incentives received.
The right-of-use asset is subsequently depreciated using
the straight-line method from the
commencement date to the earlier of the end of the useful
life of the right-of-use asset or the end of the lease
term. The estimated useful lives of right-of-use assets
are determined on the same basis as those of property
and equipment. In addition, the right-of-use asset is
periodically reduced by impairment losses, if any, and
adjusted for certain remeasurements of the lease liability
The lease liability is initially measured at the present
value of the lease payments that are not paid at the
commencement date, discounted using the interest rate
implicit in the lease or, if that rate cannot be readily
determined, the Group's incremental borrowing rate. Generally,
the Group uses its incremental borrowing rate as the
discount rate.
Lease payments included in the measurement of the lease
liability comprise the following:
-- fixed payments, including in-substance fixed payments;
-- variable lease payments that depend on an index or
a rate, initially measured using the index or rate as
at the commencement date;
-- amounts expected to be payable under a residual value
guarantee; and
-- the exercise price under a purchase option that the
Group is reasonably certain to exercise, lease payments
in an optional renewal period if the Group is reasonably
certain to exercise an extension option, and penalties
for early termination of a lease unless the Group is
reasonably certain not to terminate early.
The lease liability is measured at amortized cost using
the effective interest method. It is
remeasured when there is a change in future lease payments
arising from a change in an index or rate, if there is
a change in the Group's estimate of the amount expected
to be payable under a residual value guarantee, or if
the Group changes its assessment of whether it will exercise
a purchase, extension or termination option.
When the lease liability is remeasured in this way, a
corresponding adjustment is made to the carrying amount
of the right-of-use asset or is recorded in profit or
loss if the carrying amount of the right-of-use asset
has been reduced to zero.
The Group presents right-of-use assets that do not meet
the definition of investment property in 'property, plant
and equipment' and lease liabilities in 'loans and borrowings'
in the statement of financial position.
Short-term leases and leases of low-value assets
The Group has elected not to recognize right-of-use assets
and lease liabilities for short-term leases of machinery
that have a lease term of 12 months or less and leases
of low-value assets, including IT equipment. The Group
recognizes the lease payments associated with these leases
as an expense on a straight-line basis over the lease
term.
In the comparative period, as a lessee the Group classified
leases that transfer substantially all of the risks and
rewards of ownership as finance leases. When this was
the case, the leased assets were measured initially at
an amount equal to the lower of their fair value and
the present value of the minimum lease payments. Minimum
lease payments were the payments over the lease term
that the lessee was required to make, excluding any contingent
rent.
Subsequently, the assets were accounted for in accordance
with the accounting policy applicable to that asset.
Assets held under other leases were classified as operating
leases and were not recognized in the Group's statement
of financial position. Payments made under operating
leases were recognized in profit or loss on a straight-line
basis over the term of the lease. Lease incentives received
were recognized as an integral part of the total lease
expense, over the term of the lease.
Under IAS 17
In the comparative period, as a lessee the Group classified
leases that transfer substantially all of the risks and
rewards of ownership as finance leases. When this was
the case, the leased assets were measured initially at
an amount equal to the lower of their fair value and
the present value of the minimum lease payments. Minimum
lease payments were the payments over the lease term
that the lessee was required to make, excluding any contingent
rent.
Subsequently, the assets were accounted for in accordance
with the accounting policy applicable to that asset.
Assets held under other leases were classified as operating
leases and were not recognized in the Group's statement
of financial position. Payments made under operating
leases were recognized in profit or loss on a straight-line
basis over the term of the lease. Lease incentives received
were recognized as an integral part of the total lease
expense, over the term of the lease.
As a lessee
'Property, plant and equipment' comprise owned and leased
assets that do not meet the definition of investment
property.
The Group leases assets including buildings and vehicles.
Information about leases for which the Group is a lessee
is presented below.
Right-of-use assets
Property Vehicles Total
------------------ --------- ---------
Balance at January
1, 2018 159 80 239
Depreciation charge
for the period (40) (17) (57)
------------------ --------- ---------
Balance at June 30,
2018 119 63 182
================== ========= =========
Additions to the right-of-use assets during 2018 were
in zero thousand.
Lease liabilities
Maturity analysis - contractual undiscounted cash flows
Less than one year 111
One to five years 87
Total undiscounted lease liabilities
at June 30, 2018 198
=========
Lease liabilities included in the statement of financial
position at June 30, 2018
Current 106
Non-current 84
190
=========
Amounts recognized in profit or loss
Interest on lease liabilities (5)
Expenses relating to short-term
leases (7)
Amounts recognised in statement of cash flows
Total cash outflow for leases (54)
Total
--------
Cost:
Balance as of January
1 2018 4,202
Additions during
the year 136
Balance as of June
30 2018 4,338
--------
Accumulated Amortization:
Balance as of January
1 2018 (1,543)
Amortization during
the year (217)
Balance as of June
30 2018 (1,760)
--------
Impairment of assets (202)
Net book value as of
June 30 2018 2,376
========
Total
--------
Cost:
Balance as of January
1 2017 3,938
Additions during the
year 107
Balance as of June 30
2017 4,045
--------
Accumulated Amortization:
Balance as of January
1 2017 (1,135)
Amortization during
the year (200)
Balance as of June 30
2017 (1,335)
--------
Impairment of assets (202)
--------
Net book value as of
June 30 2017 2,508
========
Total
--------
Cost:
Balance as of January
1 2017 3,938
Additions during the
year 264
Balance as of December
31 2017 4,202
--------
Accumulated Amortization:
Balance as of January
1 2017 (1,135)
Amortization during
the year (408)
Balance as of December
31 2017 (1,543)
--------
Impairment of assets (202)
--------
Net book value as of
December 31 2017 2,457
========
NOTE 4 SHARE CAPITAL
-
a. Composition - common stock of no par value, issued
and outstanding - 273,449,513 shares and 240,409,513
shares as of June 30, 2018 and December 31, 2017, respectively.
b. A Company share grants to its holder voting rights,
rights to receive dividends and rights to net assets
upon dissolution.
c. See Note 1(a).
d. Weighted average number of shares used for calculation
of basic and diluted loss per share:
June 30 June 30 December 31
2018 2017 2017
------------------ ------------------ ------------------
Number 265,960,494 157,156,219 187,031,676
================== ================== ==================
e. Share-based payment
The following table lists the number of share options and
the exercise prices of share options during the reported
period: 2018 2017
---------------------- ---------------------
Weighted Weighted
average average
Number of exercise Number of exercise
options price options price
----------- --------- ---------- ---------
GBP GBP
---------------------- ---------------------
Share options outstanding
at beginning of year 32,729,647 0.041 7,574,033 0.092
Share options exercised
during the year (4,440,000) 0.025 - -
Share options expired
during the year (5,293,167) 0.06 - -
Share options granted
during the year 10,500,000 0.0325 25,155,614 0.025
Share options outstanding
at end of year 33,496,480 0.037 32,729,647 0.041
=========== ========= ========== =========
Share options exercisable
at end of period 14,149,640 0.046 15,835,967 0.055
=========== ========= ========== =========
During April 2018, the Company granted to its directors
and senior management Options to subscribed for 10,500,000
shares at an exercise price of GBP0.0325 per share. The
following table list the inputs to the Black and Scholes
model used for the grants.
Directors Directors
and Senior
Management
------------ ------------
Fair value at the measurement GBP0.019 GBP0.019
date
Quantity 6,000,000 4,500,000
Dividend Yield (%) - -
Expected Volatility (%) 76.8 76.8
Risk-free interest rate 1.4 1.4
(%)
Share price GBP0.02625 GBP0.02625
Vesting period (years) 1-3 1-2
Expiration period (years) 10 10
Total expenses recorded in regard to these Options in the
statement of comprehensive income for the reported period
amounted $134 thousand.
NOTE 5 - SHAREHOLDERS AND RELATED PARTIES
a. Related parties that own the controlling shares
in the Group are:
Mr. Avraham Hartman (8.12%), Mr. Uri Hartman (8.63%),
Mr. Doron Kedem (8.63%).
b. Short-term June 30 December
balances: 31
2018 2017 2017
------ ------ ---------
Credit balance (707) (108) (525)
Loans (7) (180) (188)
------ ------ ---------
(714) (288) (713)
====== ====== =========
c. Transactions: Six Months Ended Year Ended
June 30 December
31
2018 2017 2017
--------- --------- ------------
Total salaries,
services rendered
and related expenses
for shareholders 194 261 465
========= ========= ============
Total share-based
payment expenses 134 - 174
========= ========= ============
NOTE 6 - NET FINANCE INCOME (EXPENSES)
Six Months Ended Year Ended
June 30 December
31
2018 2017 2017
-------- --------- -----------
Interest to banks
and others (25) (81) (121)
Exchange rate differences 108 (220) (204)
Bank charges (34) (34) (83)
Interest to related
parties (16) - (33)
Interest to suppliers - (22) (20)
Net finance expenses 33 (357) (461)
======== ========= ===========
NOTE 7 - SEGMENTATION REPORTING
Differentiation policy for the Segments:
The Company's management has defined its segmentation
policy based on the financial essence of the different
segments. This refers to services versus goods, delivery
method and allocated resources per sector.
On this basis, the following segments were defined:
Segment information regarding the reported segments:
Hardware SAS Total
---------------- ------------ ----------------
Period Ended
30.06.2018:
Segment revenues 2,202 890 3,092
Cost of sales (1,730) (134) (1,864)
---------------- ------------ ----------------
Gross profit 472 756 1,228
Period Ended
30.06.2017:
Segment revenues 1,147 775 1,922
Cost of sales (923) (96) (1,019)
---------------- ------------ ----------------
Gross profit 224 679 903
Year Ended
31.12.2017:
Segment revenues 3,715 1,725 5,440
Cost of sales (3,166) (194) (3,360)
---------------- ------------ ----------------
Gross profit 549 1,531 2,080
NOTE 8 - SIGNIFICANT EVENTS AFTER THE REPORTED PERIOD
Since the Period end, the Company has negotiated increased
bank facilities with a major bank in Israel for the amount
of 2.4m shekels ($0.66m) subject to normal bank covenants
and conditions. These new facilities demonstrate the
confidence of the bank in our future plans
-ends-
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
END
IR DGGDIBDDBGII
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August 29, 2018 02:01 ET (06:01 GMT)
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