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Wameja Limited Half-year Report & Appendix 4D

31/08/2021 9:15am

UK Regulatory (RNS & others)


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TIDMWJA

RNS Number : 2107K

Wameja Limited

31 August 2021

Appendix 4D

Wameja Limited

ABN 59 052 947 743

Half-year report and Appendix 4D

for the half-year ended 30 June 2021

The half-year financial report does not include notes of the type normally included in an annual financial report and should be read in conjunction with the 31 December 2020 financial report.

Half-year report & Appendix 4D

for the half year ended

30 June 2021

Contents

Results for announcement to the market 1

Directors' report

2

Auditor's independence declaration

5

Independent review report

6

Directors' declaration

8

   Condensed consolidated statement of profit or loss and other comprehensive income             9 

Condensed consolidated statement of financial position 10

Condensed consolidated statement of changes in equity 11

Condensed consolidated statement of cash flows 12

Notes to the condensed consolidated financial statements 13

Results for announcement to the market

 
 Results                                                               A$ '000 
 
 Loss after tax from ordinary activities 
  attributable to members                     up            6%    to     3,405 
 
  Loss after tax attributable to members      up            6%    to     3,405 
 
 Dividends (distributions)                     Amount per       Franked amount 
                                                 security         per security 
 Current period 
  Interim dividend declared                         Nil c                   0% 
  Final dividend paid                               Nil c                   0% 
                                                           ------------------- 
 Previous corresponding period 
  Interim dividend declared                               Nil c             0% 
  Final dividend paid                                     Nil c             0% 
                                             ------------------  ------------- 
 
 Record date for determining entitlements     N/A 
 to the dividend. 
 
 
 
 
 Brief explanation of Key Information and Dividends 
 
  The Company is partnering with Mastercard to build the HomeSend 
  global payments hub. HomeSend enables cross-border transfer 
  between bank accounts, cards, mobile wallets, or cash outlets 
  from anywhere in the world. As a founding partner in the HomeSend 
  hub, Wameja helped conceive and bring the opportunity to market. 
  HomeSend is a joint venture of Wameja (35.26%) and Mastercard 
  (64.74%). 
 
  The net result of the consolidated entity for the half year 
  ended 30 June 2021 was a loss after tax for the period of $3.405 
  million (2020: $3.205 million loss). Loss per share was 0.3 
  cents (2020: loss per share 0.3 cents). 
 
  During the period, there was a net cash outflow of $5.700 million 
  (2020 year: net outflow of $6.45m) primarily resulting from 
  a net outflow from investing activities (mainly in relation 
  to investment to HomeSend) of $4.955 million. Cash at 30 June 
  2021 was $2.326 million. 
 
  On 10 September 2020, Wameja Limited entered into a Scheme Implementation 
  Agreement with Burst Acquisition Co. Pty Ltd, a company controlled 
  by Mastercard, for Burst Acquisition Co Pty Ltd to acquire all 
  of the issued capital of Wameja Limited for GBP0.08 per share 
  by way of a Scheme of Arrangement pursuant to Australian Law 
  under Part 5.1 of the Corporate Act ("the Scheme"). 
 
  Subject to the relevant approvals, Scheme consideration will 
  be paid to Scheme Shareholders on the implementation date, which 
  is currently expected to be 21 September 2021 . 
 

Directors' report

The Directors of Wameja Limited (the Company) submit herewith the financial report of Wameja Limited and its controlled entities (the Group) for the half-year ended 30 June 2021. In order to comply with the provisions of the Corporations Act 2001, the Directors report as follows:

Directors

The names of the Directors who held office during or since the end of the half year are:

   John Conoley                Non-executive Chairman 
   James Brooke               Non-executive Director 
   Stephen Baldwin           Non-executive Director 
   James Hume                 Non-executive Director 
   Thomas Rowe               Company Secretary and non-executive Director 

Review of Operations

This report is to be read in conjunction with other reports issued contemporaneously.

Wameja Limited is a public company listed on the Australian Securities Exchange (ASX:WJA) and the London Stock Exchange (AIM) (LSE:WJA).

The Company is partnering with Mastercard to build the HomeSend global payments hub. HomeSend enables cross-border transfer between bank accounts, cards, mobile wallets, or cash outlets from anywhere in the world. As a founding partner in the HomeSend hub, Wameja helped conceive and bring the opportunity to market. HomeSend is a joint venture of Wameja (35.26%) and Mastercard (64.74%).

The net result of the consolidated entity for the half year ended 30 June 2021 was a loss after tax of $3.405 million (2020: $3.205 million loss). Loss per share was 0.3 cents (2020: loss per share 0.3 cents).

During the period, there was a net cash outflow of $5.70 million primarily resulting from a net outflow from investing activities (mainly in relation to investment and advances to HomeSend) of $4.955 million. Cash at 30 June 2021 was $2.326 million.

On 10 September 2020, Wameja Limited entered into a Scheme Implementation Agreement with Burst Acquisition Co. Pty Ltd, a company controlled by Mastercard, for Burst Acquisition Co Pty Ltd to acquire all of the issued capital of Wameja Limited for GBP0.08 per share by way of a Scheme of Arrangement pursuant to Australian Law under Part 5.1 of the Corporations Act ("the Scheme").

Subject to the relevant approvals, the Scheme consideration will be paid to Scheme Shareholders on the implementation date, which is currently expected to be 21 September 2021.

Subsequent events

Impact of COVID-19

The impact of the Coronavirus (COVID 19) pandemic is ongoing and while COVID -- 19 has been financially neutral for the Group up to 30 June 2021, it is not practicable to estimate the extent of the potential impact, positive or negative, after the reporting date. The situation is continually developing and is dependent on measures imposed by the governments and authorities around the world, including vaccinations, quarantining, travel restrictions and any economic stimulus that may be provided.

Based on the information available to the directors as at the date of this financial report, there are no significant factors identified which would likely impact on the carrying value of the Group's investment in associate due to COVID-19. However, the directors consider that prolonged general economic impacts arising from COVID-19 may have a negative impact on the operations of the Group's associate. This in turn may impact the future recoverability of the Group's carrying value of the associate investment.

Directors' report

Subsequent events (continued)

Scheme of Arrangement

On 27 July 2021, the Company announced an Order to convene Scheme Meeting associated with the Scheme discussed above in the Review of Operations, and on 2 August 2021 the Company issued the notice for the shareholder meeting, explanatory statement and the terms of the Scheme to the shareholders and deposit interest holders. The proposed dates for the Scheme as announced by the Company are:

 
 Scheme Meeting:             2 September 
                                    2021 
 Second Court Date:          9 September 
                                    2021 
 Effective Date (Last       10 September 
  day of trading)                   2021 
 Record Date:               14 September 
                                    2021 
 Implementation (Payment)   21 September 
  Date                              2021 
 

No other matter or circumstance has occurred subsequent to period end that has significantly affected, or may significantly affect, the operations of the Group, the results of those operations or the state of affairs of the entity in subsequent financial years.

Future developments

To the extent that the disclosure of information regarding likely developments in the operations of the Group in future financial years, and the expected results of those operations is likely to result in unreasonable prejudice to the Group, such information has not been disclosed in this report.

Environmental regulations

The Group operates primarily within the technology and telecommunication sector and conducts its business activities with respect for the environment while continuing to meet the expectations of shareholders, customers, employees and suppliers.

During the period under review, the Directors are not aware of any particular or significant environmental issues which have been raised in relation to the Group's operations.

Dividends

No dividends were declared or paid during this half year (2020: nil).

Share Options

Wameja Limited Employee Share Option Plan

The Company has an ownership-based remuneration scheme for executive directors, key management personnel and employees. In accordance with the provisions of the scheme, executive directors and employees may be granted options to acquire ordinary shares in the Company. The exercise of any share options is not dependent on any performance criteria, however, is dependent on a period of service relative to the vesting dates.

Share options granted to directors and senior management

During this half year and up to the date of this report the Company did not grant additional shares or options.

Details of unissued shares under option as at the date of this report are:

 
                                 Number of 
            Issuing Entity        shares           Class of    Exercise price        Expiry date of 
                                  under option     shares      of option                options 
Wameja Limited 6,000,000 Ordinary $0.21 13 Mar 2022 
Wameja Limited 3,350,000 Ordinary $0.21 24 Nov 2022 
 

During the financial period and up to the date of this report, there were no options exercised or lapsed. On 14 March 2021, 3,000,000 $0.21 Executive Options and 1,575,000 $0.21 Employee Options expired. On 8 August 2021 additional 2,000,000 $0.21 Executive Options and 1,650,000 $0.21 Employee Options expired.

Directors' report

Auditor's Independence Declaration

The lead auditor's independence declaration under s 307C of the Corporations Act 2001 is set out on page 5 for the half-year ended 30 June 2021.

Rounding of Amounts

The Group has applied the relief available to it in ASIC Corporations (Rounding in Financial/Directors' Reports) Instrument 2016/191 and accordingly certain amounts in the financial report and the directors' report have been rounded off to the nearest $1,000.

John Conoley

Executive Chairman

London, 31 August 2021

The Board of Directors

Wameja Limited

c/- Simpsons Solicitors

Level 2, Pier 8/9

23 Hickson Road

Millers Point NSW 2000

31 August 2021

Dear Board Members

Wameja Limited

In accordance with section 307C of the Corporations Act 2001, I am pleased to provide the following declaration of independence to the directors of Wameja Limited.

As lead audit partner for the review of the half year financial report of Wameja Limited for the half year ended 30 June 2021, I declare that to the best of my knowledge and belief, there have been no contraventions of:

(i) The auditor independence requirements of the Corporations Act 2001 in relation to the review; and

   (ii)        Any applicable code of professional conduct in relation to the review. 

Yours faithfully

DELOITTE TOUCHE TOHMATSU

Rajnil Kumar

Partner

Chartered Accountants

Independent Auditor's Review Report to the

Members of Wameja Limited

Conclusion

We have reviewed the half-year financial report of Wameja Limited (the "Company") and its subsidiaries (the "Group"), which comprises the condensed consolidated statement of financial position as at 30 June 2021, and the condensed consolidated statement of profit or loss and other comprehensive income, the condensed consolidated statement of cash flows and the condensed consolidated statement of changes in equity for the half-year ended on that date, notes comprising a summary of significant accounting policies and other explanatory information, and the directors' declaration.

Based on our review, which is not an audit, we have not become aware of any matter that makes us believe that the half-year financial report of the Group is not in accordance with the Corporations Act 2001, including:

-- Giving a true and fair view of the Group's financial position as at 30 June 2021 and of its performance for the half-year ended on that date; and

-- Complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001.

Basis for Conclusion

We conducted our review in accordance with ASRE 2410 Review of a Financial Report Performed by the Independent Auditor of the Entity. Our responsibilities are further described in the Auditor's Responsibilities for the Review of the Half-year Financial Report section of our report. We are independent of the Group in accordance with the ethical requirements of the Accounting Professional and Ethical Standards Board's APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code) that are relevant to our audit of the annual financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.

We confirm that the independence declaration required by the Corporations Act 2001, which has been given to the directors of the Company, would be in the same terms if given to the directors as at the time of this auditor's review report.

Directors' Responsibilities for the Half-year Financial Report

The directors of the Company are responsible for the preparation of the half-year financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the half-year financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error.

Auditor's Responsibilities for the Review of the Half-year Financial Report

Our responsibility is to express a conclusion on the half-year financial report based on our review. ASRE 2410 requires us to conclude whether we have become aware of any matter that makes us believe that the half-year financial report is not in accordance with the Corporations Act 2001 including giving a true and fair view of the Group's financial position as at 30 June 2021 and its performance for the half-year ended on that date, and complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001.

A review of a half-year financial report consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Australian Auditing Standards and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Deloitte Touche Tohmatsu

Rajnil Kumar

Partner

Chartered Accountants

Parramatta, 31 August 2021

Directors' declaration

In accordance with a resolution of the directors of Wameja Limited, the directors of the company declare that:

 
 1.   the financial statements and notes, as set out on pages 
       9 to 16, are in accordance with the Corporations Act 
       2001, including: 
 
 a.   complying with Accounting Standard AASB 134: Interim 
       Financial Reporting; and 
 
 b.   giving a true and fair view of the financial position 
       as at 30 June 2021 and of the performance for the half 
       year ended on that date of the Consolidated Group. 
 
 2.   in the directors' opinion there are reasonable grounds 
       to believe that the Company will be able to pay its 
       debts as and when they become due and payable. 
 
 
 

On behalf of the Directors

John Conoley

Executive Chairman

London, 31 August 2021

Condensed consolidated statement of profit or loss and other comprehensive income for the half-year ended 30 June 2021

 
                                                        Consolidated 
                                                                   Half-Year 
                                                Half-Year Ended      Ended 
                                                  30 June 2021      30 June 
                                         Note        $'000         2020 $'000 
 Continuing operations 
 Gain on dilution of investment 
  in associate                            7                 287             - 
 Finance and other costs                                   (37)          (17) 
 Foreign exchange gain/ 
  (loss)                                                   (85)           660 
 Administration expenses                                  (677)         (659) 
 Share of profit/(loss) 
  of associate                            7             (2,893)       (3,189) 
                                               ----------------  ------------ 
 Loss before tax                                        (3,405)       (3,205) 
 Income tax expense                                           -             - 
                                               ----------------  ------------ 
 
 Loss for the period                                    (3,405)       (3,205) 
                                               ----------------  ------------ 
 
 
   Other comprehensive income/(loss), 
   net of tax 
 
   Items that may be reclassified 
   subsequently to profit 
   or loss 
   Exchange differences arising 
   on the translation of foreign 
   operations (nil tax impact)                            (306)           116 
                                               ----------------  ------------ 
 Total comprehensive income/(loss) 
  for the period                                        (3,711)       (3,089) 
                                               ================  ============ 
 
  Loss attributable to: 
 Equity holders of the parent                           (3,405)       (3,205) 
 
 Total comprehensive income/(loss) 
  attributable to: 
 Equity holders of the parent                           (3,711)       (3,089) 
 
   Earnings/(Loss) per share: 
 
 
   *    Basic (cents per share)                           (0.3)         (0.3) 
 
   *    Diluted (cents per share)                         (0.3)         (0.3) 
 
 
 
 

Notes to the Financial Statements are included on pages 13 to 16

Condensed consolidated statement of financial position

as at 30 June 2021

 
                                                            Consolidated 
                                        ---------------------------------------------------- 
                                               30 June 2021             31 December 2020 
                                  Note             $'000                      $'000 
 Current Assets 
 Cash and cash equivalents                                  2,326                      8,014 
 Other assets                                                  30                          - 
 
 Total Current Assets                                       2,356                      8,014 
 
 Non-Current Assets 
 Investment in associates          7                       25,532                     23,585 
 
 Total Non-Current Assets                                  25,532                     23,585 
                                        -------------------------  ------------------------- 
 
 Total Assets                                              27,888                     31,599 
                                        -------------------------  ------------------------- 
 
 Current Liabilities 
 Trade and other payables                                     100                        100 
 
 Total Current Liabilities                                    100                        100 
                                        -------------------------  ------------------------- 
 
 Total Non-Current Liabilities                                  -                          - 
 
 Total Liabilities                                            100                        100 
                                        -------------------------  ------------------------- 
 
 Net Assets                                                27,788                     31,499 
                                        =========================  ========================= 
 
 Equity 
 Issued capital                    4                      212,326                    212,326 
 Reserves                          5                        4,207                      4,513 
 Accumulated losses                8                    (188,745)                  (185,340) 
                                        -------------------------  ------------------------- 
 Total Equity                                              27,788                     31,499 
                                        =========================  ========================= 
 

Notes to the Financial Statements are included on pages 13 to 16

Condensed consolidated statement of changes in equity

for the half-year ended 30 June 2021

 
                                                        Foreign                                                        Attributable 
                                                        Currency         Equity-settled                                  to owners           Non 
                                   Issued             Translation           benefits            Accumulated               of the         controlling 
                                   Capital              Reserve              Reserve               Losses                 parent           Interest           Total 
                                    $'000                $'000                $'000                 $'000                  $'000            $'000              $'000 
 Consolidated 
 Balance at 1 
  January 2021                          212,326                   337              4,176                (185,340)               31,499              -               31,499 
                            -------------------  --------------------  -----------------  -----------------------  -------------------  -------------  ------------------- 
 Loss for the 
  period                                      -                     -                  -                  (3,405)              (3,405)              -              (3,405) 
 Exchange differences 
  arising on translation 
  of foreign operations                       -                 (306)                  -                        -                (306)              -                (306) 
                            -------------------  --------------------  -----------------  -----------------------  -------------------  -------------  ------------------- 
 Total comprehensive 
  income/(loss) 
  for the period                              -                 (306)                  -                  (3,405)              (3,711)              -              (3,711) 
                            -------------------  --------------------  -----------------  -----------------------  -------------------  -------------  ------------------- 
 Balance at 30 
  June 2021                             212,326                    31              4,176                (188,745)               27,788              -               27,788 
                            -------------------  --------------------  -----------------  -----------------------  -------------------  -------------  ------------------- 
 
 
            Balance at 1 
             January 2020               212,326                   879              4,043                (176,181)               41,067              -               41,067 
                            -------------------  --------------------  -----------------  -----------------------  -------------------  -------------  ------------------- 
 Loss for the 
  period                                      -                     -                  -                  (3,205)              (3,205)              -              (3,205) 
            Exchange 
             differences 
             arising on 
             translation 
             of foreign 
             operations                       -                   116                  -                        -                  116              -                  116 
                            -------------------  --------------------  -----------------  -----------------------  -------------------  -------------  ------------------- 
            Total 
             comprehensive 
             income/(loss) 
             for the 
             period                           -                   116                  -                  (3,205)              (3,089)              -              (3,089) 
            Equity settled 
             payments                         -                     -                 80                        -                   80              -                   80 
                            -------------------  --------------------  -----------------  -----------------------  -------------------  -------------  ------------------- 
            Balance at 30 
             June 2020                  212,326                   995              4,123                (179,386)               38,058              -               38,058 
                            -------------------  --------------------  -----------------  -----------------------  -------------------  -------------  ------------------- 
 
 

Notes to the Financial Statements are included on pages 13 to 16

Condensed consolidated statement of cash flows

for the half-year ended 30 June 2021

 
                                                                 Consolidated 
                                                           Half-Year       Half-Year 
                                                             Ended           Ended 
                                                          30 June 2021    30 June 2020 
                                                             $'000           $'000 
                                                        --------------  -------------- 
 
           Cash Flows from Operating Activities 
 Payments to suppliers and employees                             (745)           (357) 
 
 Net cash used in operating activities                           (745)           (357) 
                                                        --------------  -------------- 
 
 Cash Flows from Investing Activities 
 Investment in HomeSend associate                              (4,955)         (6,090) 
 
 Net cash used in investing activities                         (4,955)         (6,090) 
                                                        --------------  -------------- 
 
 Cash Flows from Financing Activities 
 Net cash used in financing activities                               -               - 
                                                        --------------  -------------- 
 
 Net Decrease in Cash and Cash Equivalents                     (5,700)         (6,447) 
 
 Cash at the beginning of the period                             8,014          11,636 
 Effects of exchange rate changes on 
  the balance of cash held in foreign 
  currencies                                                        12             116 
                                                        --------------  -------------- 
 
 Cash and Cash Equivalents at the end 
  of the period                                                  2,326           5,305 
                                                        ==============  ============== 
 

Notes to the Financial Statements are included on pages 13 to 16

Notes to the condensed consolidated financial statements

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a) Basis of preparation

These general purpose interim financial statements for half-year reporting period ended 30 June 2021 have been prepared in accordance with requirements of the Corporations Act 2001 and Australian Accounting Standard AASB 134: Interim Financial Reporting. The Group is a for-profit entity for financial reporting purposes under Australian Accounting Standards.

This interim financial report is intended to provide users with an update on the latest annual financial statements of Wameja Limited and its controlled entities (referred to as the "Consolidated Group" or "Group"). As such, it does not contain information that represents relatively insignificant changes occurring during the half-year within the Group. It is therefore recommended that this financial report be read in conjunction with the annual financial statements of the Group for the year ended 31 December 2020, together with any public announcements made during the following half-year.

These interim financial statements were authorised for issue on 31 August 2021.

(b) Accounting Policies

The same accounting policies and methods of computation have been followed in this interim financial report as were applied in the most recent annual financial statements.

The Group has considered the implications of new and amended Accounting Standards, but determined that their application to the financial statements is either not relevant or not material.

2. SEGMENT INFORMATION

AASB 8 requires operating segments to be identified on the basis of internal reports about components of the Group that are regularly reviewed by the chief operating decision maker in order to allocate resources to the segment and to assess its performance.

The Group operates in a single segment being the telecommunications software solutions business. Accordingly, all reported information in the financial report relates to this single segment.

3. ISSUANCES, REPURCHASED ANS REPAYMENT OF SECURITIES

During the current period the Company did not issue any shares (2020: nil).

No employee share options were exercised or cancelled in the period (2020: nil).

4. ISSUED CAPITAL

 
                                                           31 December 
                                            30 June 2021       2020 
                                                $'000         $'000 
 1,210,850,662 fully paid ordinary 
  shares 
  (2020: 1,210,850,662)                       212,326        212,326 
                                           -------------  ------------ 
 
 
 
                                           30 June 2021        31 December 2020 
                                        No. '000     $'000    No. '000     $'000 
                                       ----------  --------  ----------  -------- 
 Fully Paid Ordinary Shares 
 Balance at the beginning of the 
  financial period                      1,210,851   212,326   1,210,851   212,326 
 Balance at the end of the financial 
  period                                1,210,851   212,326   1,210,851   212,326 
                                       ----------  --------  ----------  -------- 
 

Notes to the condensed consolidated financial statements

5. RESERVES

 
 
                                          30 June 2021   31 December 
                                                             2020 
                                              $'000         $'000 
 
 Employee equity-settled benefit             4,176          4,176 
 Foreign currency translation                   31            337 
                                         -------------  ------------ 
                                             4,207          4,513 
                                         -------------  ------------ 
 

6. DIVIDS

No dividend has been paid or declared in respect of this half year (2020: $Nil).

7. INVESTMENT IN ASSOCIATES

Details of the material investment in associates at the end of the reporting period are as follows:

 
   Name of         Principal activity        Place of incorporation       Proportion of ownership 
  associate                                       and principal          interest and voting rights 
                                                place of business            held by the Group 
                                                                        30 June 2021    31 December 
                                                                                         2020 
              ----------------------------  ------------------------  ---------------  ------------- 
 HomeSend      Provision of international 
  SRCL (a)      mobile money services        Brussels, Belgium             35.26%          35.68% 
              ----------------------------  ------------------------  ---------------  ------------- 
 

a) HomeSend SRCL was formed on 3 April 2014. The Directors have determined that the Group exercises significant influence over HomeSend SRCL by virtue of its 35.26% voting power in shareholders meetings and its contractual right to appoint two out of six directors to the board of Directors of that Company.

The associate is accounted for using the equity method in these condensed consolidated financial statements.

   b)      Reconciliation of the carrying amount of the investment in associate: 
 
                                                   30 June        31 December 
                                                                         2020 
                                                      2021               $000 
                                                      $000 
 
 Opening balance                                    23,585             25,463 
 Investment in associate (i),(ii)                    4,955              6,090 
 Gain on dilution of investment in associate           287                  - 
  (i) 
 Share of current period loss of the associate     (2,893)            (7,779) 
 Effects of foreign currency exchange movements      (402)              (189) 
 
 Closing balance                                    25,532             23,585 
                                                  --------       ------------ 
 

(i) On 18 March 2021, the Company subscribed for EUR1,784,118 of shares in HomeSend SCRL. The equity contribution was part of a EUR6,000,000 capital raise with Mastercard agreeing to contribute an additional EUR1,000,000 over and above its proportionate interest in HomeSend SCRL. The additional investment by Mastercard resulted in a change in ownership interest held by the Company from 35.68% to 35.26%. The Company has consequently recognised a gain on dilution of investment in associate of $287,000 in the profit or loss.

(ii) On 23 June 2021, the Company subscribed for a further EUR1,410,588 of shares in HomeSend SCRL. The equity contribution was part of a EUR4,000,000 capital raise with Mastercard contributing the balance in proportion to its interest in HomeSend SCRL.

The funds from the capital raise are to be used to support the operational expenses of the HomeSend 2021 business plan and its minimum equity requirements for H2 2021.

Notes to the condensed consolidated financial statements

8. ACCUMULATED LOSSES

 
                                                                    31 December 
                                                     30 June 2021       2020 
                                                         $'000         $'000 
 Balance at beginning of the financial period           (185,340)     (176,181) 
 Loss for the year attributable to equity holders 
  of the parent                                           (3,405)       (9,159) 
 Balance at end of financial period                     (188,745)     (185,340) 
                                                    -------------  ------------ 
 

9. CONTINGENT LIABILITIES

   a)   Notices of Potential Claim 

In July 2019, Wameja Limited ("Wameja" or the "Company") sold all the issued capital of eServGlobal Holdings SAS and its subsidiaries ("eServGlobal") to Seamless Distribution Systems AB ("Seamless"). The sale comprised the effective sale of Wameja's operating business. The sale and purchase agreement ("SPA") included an indemnity under which Wameja agreed to indemnify and hold Seamless harmless against any direct loss, damage or liability related to the lack of renewed licences for eServGlobal's use of a specific third party's intellectual property ("the Indemnity"). The third party is the provider of software embedded in all deployments of eServGlobal's "Paymobile" platform, eServGlobal's primary product.

At the end of September 2020, Wameja received a notification of potential claim under the Indemnity from Seamless regarding an issue that had arisen between Botswana Telecommunications ("BTC") (an eServGlobal customer) and the third-party software supplier. Seamless subsequently issued another notice with their estimation of the exposure under the Indemnity across BTC and other eServGlobal clients.

On 18 June 2021, Wameja, Mastercard, Seamless and the third party software provider referred to in the Indemnity entered into a settlement agreement to resolve the potential for any claim under the Indemnity or any similar claims under the SPA. This settlement agreement (to be funded by Mastercard) is conditional upon completion of the Scheme and accordingly, if the Scheme were not to complete, the settlement agreement would cease to have any effect and the potential for claims against Wameja under the Indemnity would remain.

In the event that the settlement agreement ceases, the directors continue to consider there to be no present obligation or material exposure under the Indemnity on the basis that:

-- there has to date been no claim by the third-party software supplier against Wameja or Seamless arising from the non - renewal of licences, or any other matter, and

-- Seamless has not particularised the basis under the SPA upon which it believes that there is a potential claim under the Indemnity.

No provision has been recognised in the financial report as at 30 June 2021.

   b)   Warranty claim 

On 3 July 2020, the company received notification of a purported warranty claim from Seamless in relation to a French employee of eServGlobal SAS whose employment was terminated subsequent to completion of the sale of eServGlobal Holdings SAS to Seamless. The notification sought to claim EUR519,967 ($843,007) under the warranties contained within the SPA, being the amount including taxes, that the employee was seeking from eServGlobal SAS for compensation for loss of employment.

The directors have assessed and considered the purported warranty claim to be without merit and have advised Seamless as such, and rejected the suggestion that the liability to the employee is subject to the warranties in the SPA.

At the date of this financial report, there has been no further correspondence from Seamless on this matter and the directors maintain their position that the purported warranty claim is without merit.

Notes to the condensed consolidated financial statements

10. SUBSEQUENT EVENTS

Impact of COVID-19

The impact of the Coronavirus (COVID 19) pandemic is ongoing and while COVID -- 19 has been financially neutral for the Group up to 30 June 2021, it is not practicable to estimate the extent of the potential impact, positive or negative, after the reporting date. The situation is continually developing and is dependent on measures imposed by the governments and authorities around the world, including vaccinations, quarantining, travel restrictions and any economic stimulus that may be provided.

Based on the information available to the directors as at the date of this financial report, there are no significant factors identified which would likely impact on the carrying value of the Group's investment in associate due to COVID-19. However, the directors consider that prolonged general economic impacts arising from COVID-19 may have a negative impact on the operations of the Group's associate. This in turn may impact the future recoverability of the Group's carrying value of the associate investment.

Scheme of Arrangement

On 27 July 2021, the Company announced an Order to convene Scheme Meeting associated with the Scheme as disclosed in the Review of Operations section of the directors' report, and on 2 August 2021 the Company issued the notice for the shareholder meeting, explanatory statement and the terms of the Scheme to the shareholders and deposit interest holders. The proposed dates for the Scheme as announced by the Company are:

 
 Scheme Meeting:             2 September 
                                    2021 
 Second Court Date:          9 September 
                                    2021 
 Effective Date (Last       10 September 
  day of trading)                   2021 
 Record Date:               14 September 
                                    2021 
 Implementation (Payment)   21 September 
  Date                              2021 
 

No other matter or circumstance has occurred subsequent to period end that has significantly affected, or may significantly affect, the operations of the Group, the results of those operations or the state of affairs of the entity in subsequent financial years.

11. Other information required to be given to ASX under listing rule 4.2A.3

 
 Net tangible assets per   Current period    31 December 
  security                                          2020 
 Net tangible assets per       2.29 cents     2.60 cents 
  security 
 

Dividends

 
                                  Amount            Amount          Franked          Amount     Date paid/ 
                                              per security           amount    per security        payable 
                                                               per security      of foreign 
                                                                     at 30%          source 
                                                                        tax        dividend 
 
   Interim dividend: Current        Nil           N/A              N/A              N/A            N/A 
   year 
 
   Previous period                  Nil           N/A              N/A              N/A            N/A 
                                                                                             ------------- 
 
   Final dividend paid 
   in respect of previous 
   financial year: 
                                     Nil          N/A              N/A              N/A            N/A 
   Current period: 
   Final dividend 
 
   Previous corresponding 
   period:                           Nil          N/A              N/A              N/A            N/A 
   Special dividend 
   Final dividend 
                                                                                             ------------- 
 
   The dividend or distribution plans shown below are in operation. 
 N/A. 
 
 The last date(s) for receipt of 
  election notices for the dividend                                 N/A 
  or distribution plans 
 
 

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END

IR FIFLTTLILVIL

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August 31, 2021 04:15 ET (08:15 GMT)

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