REG - Fiinu PLC - Final Results
23/04/2024 07:00
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RNS Number : 5655L Fiinu PLC 23 April 2024
Certain information contained in this announcement would have been deemed
inside information for the purposes of Article 7 of the Market Abuse
Regulation (EU) No 596/2014 ('MAR'), which is part of UK law by virtue of the
European Union (Withdrawal) Act 2018, until the release of this announcement
23 April 2024
Fiinu Plc
("Fiinu", the "Company" or the "Group")
Final Results
Fiinu, a fintech group, creator of the Plugin Overdraft®, announces its final
results for the year ended 31 December 2023.
The Annual Report and Accounts for the year ended 31 December 2023, together
with the Notice of Annual General Meeting, will be despatched to shareholders
shortly and is available to download from the Company's website at
www.fiinuplc.com (http://www.fiinuplc.com) .
Commenting, Dr. Marko Sjoblom, Chief Executive Officer said:
"Last year was difficult for management, but as we navigate this pivotal
moment in our Company's journey, I am buoyed by the progress we are making. We
now have a "bank-in-a-box", the liquidity to continue as a going concern and
we still believe in the market opportunity, which is ripe and growing, both
home and abroad. Looking ahead, we must build upon this momentum and continue
to deliver value for our investors. I am committed to making things even
better for Fiinu.
"In the short term, as well as continuing to seek interim and conditional
funding to allow us to rehire key staff and ultimately re-apply for our
banking licence, we will explore new avenues for revenue, such as technology
white-labelling and joint venture opportunities. These opportunities, which
were always in our strategy, would allow us to generate immediate
banking-as-a-service licencing revenue, prove the product market fit and that
the technology works but also, pave the way for our long-term ambitions for
Fiinu Bank.
"These initiatives, coupled with our unwavering commitment to financial
inclusion, should ultimately drive our Company's share price higher and
solidify our position as a disruptor in the banking landscape. With each
milestone we achieve and each challenge we overcome; we reaffirm our
dedication to creating a brighter, more inclusive financial future for all.
"
Enquiries:
Fiinu Plc
Dr. Marko Sjoblom Tel: +44 (0)1932 629 582
SPARK Advisory Partners Limited (Nomad) Tel: +44 (0) 203 368 3550
Mark Brady / Adam Dawes
SP Angel Corporate Finance LLP (Joint Broker) Tel: +44 (0) 207 470 0470
Bruce Fraser / Ezgi Senturk
Panmure Gordon (UK) Limited (Joint Broker) Tel: +44 (0)207 886 2500
Stephen Jones / Atholl Tweedie (Corporate Finance)
Hugh Rich (Corporate Broking)
About Fiinu
Fiinu, founded in 2017, is a fintech group, that developed the Plugin
Overdraft® which is an unbundled overdraft solution that allows customers to
have an overdraft without changing their existing bank. The underlying Bank
Independent Overdraft® technology platform is bank agnostic, that therefore
enables it to serve all other banks' customers. Open Banking allows Fiinu's
Plugin Overdraft® to attach ("plugin") to the customer's existing bank
accounts, no matter which bank they may use. Fiinu's vision is built around
Open Banking, and it believes that it increases competition and innovation in
UK banking.
For more information, please visit www.fiinuplc.com (http://www.fiinuplc.com)
CHAIR'S STATEMENT
Chair Review
As I deliver my second-year statement as Chair of Fiinu Plc, I am buoyed by
the resilience and determination of all those who worked so hard to make Fiinu
a success amidst very challenging capital market conditions, especially for
pre-revenue, financial services startups like Fiinu with novel new products.
As stated in recent public announcements, while the team succeeded in getting
to a position where we could attest to the Regulators the operational
readiness of Fiinu Bank, we were unable to give the Regulators a definitive
attestation that we had raised the regulatory capital required to exit
mobilisation; consequently, we were left with no choice but to return our
banking licence.
Despite this setback, we remain steadfast in our commitment to playing our
part in revolutionising banking services by providing the underserved with our
Plugin Overdraft®. We believe that millions of customers will eventually
benefit from this product, which Fiinu remains committed to bringing to the
market. I must, however, acknowledge that we still have work to do before
reapplying for our banking licence.
Being unable to raise exit capital was a huge disappointment and, as a result,
we had to resort to a cost-cutting programme to preserve our options. However,
I want to acknowledge that it was no small achievement to have been able to
attest to the accomplishment of all the other conditions set by the PRA and
the FCA to exit mobilisation. As a result of being so close to achieving our
most important strategic goal, the Board has stated its intention to continue
to pursue our chosen strategy and to seek to raise the required funding to
reapply for our banking licence as soon as possible.
I would also like to take this opportunity to extend my thanks to the many
executive and staff members, as well as the Board members who stepped down at
the end of 2023. Their contributions were outstanding. Although the Board is
smaller as a result of these departures, we continue to work within a robust
governance framework, which I believe has the knowledge and skills to seize
the opportunities I am still convinced lie ahead for our Group.
Finally, I would like to thank our shareholders for their support which has
been a cornerstone of our resilience and to thank them for their patience. I
acknowledge that the challenges of accessing capital markets remain and this
must weigh heavily on our shareholders' minds, as it does on the Board's, but
I ask them for their continued support which is now more crucial than ever.
Outlook
As we look towards 2024 and beyond, all those remaining at Fiinu do so with a
sense of determination to get firm commitments to providing us with the
capital we need to renew our operational readiness to reapply for our banking
licence and to becoming authorised to commence trading as quickly as possible.
Our vision remains clear and unchanged, and I wish to provide assurance that
the Board will be striving to pursue it with vigour on behalf of all our
shareholders.
David Hopton
Chair
CHIEF EXECUTIVE'S STATEMENT
I remain committed to the principles of our original mission and the vision,
which I set as the Founder seven years ago: "The Bank Independent Plugin
Overdraft® platform will create a totally new market, an infrastructure where
unbundled overdrafts will increase financial fairness and freedom for
everyone, everywhere." My unwavering dedication is a testament to our
collective belief in the transformative power of our vision. Despite the
challenges we faced in 2023, there is still cause for optimism, including but
not limited to:
1. We now have a "bank-in-a-box". The data room includes over 2,000 pages
of relevant regulatory documentation to exit mobilisation and licensable
technology infrastructure which could now access more than 100 million bank
accounts in the United Kingdom. Fiinu Bank was ready to attest all but one of
the conditions (capital missing) set by the PRA and the FCA to exit
mobilisation, including an external independent technical audit by Grant
Thornton and a technical walk through with Regulators. The submitted and
stored banking licence application is over 4,000 pages of documentation. We
believe in the future value of this intellectual property, and although we may
have written it down in accounting terms, it does not represent a loss of any
intellectual property as the bank is in the box.
2. We have the liquidity to remain solvent and continue as a going
concern. At the 2023 year-end, we had circa £1.3m cash-at-bank. Following the
successfully executed cost-cutting programme, we have now reduced our average
monthly burn rate below £50k (April 2024 to March 2025) and hence we maintain
sufficient cash runway to continue to seek the exit capital required to
reapply for our banking licence.
3. We still believe in the market opportunity, which is ripe and growing,
both home and abroad. The annual UK unsecured gross lending market is circa
£345 billion. There are over 100 million bank accounts, of which, 80 million
do not have access to overdraft currently. Our research suggests that circa 29
million consumers would be very likely to add a Plugin Overdraft® to their
bank account as long as they didn't need to switch their bank. We want to
re-open that market as nearly two-thirds (62%) of the UK adult population with
a bank account used some form of overdraft annually prior to the major reform
in 2020.
Outlook
We believe our solution has the potential to be disruptive for the banking
landscape and it will improve financial inclusion for millions of people. Our
resilience has been strong to get to where we are today, and we are continuing
our efforts to raise the conditional capital to obtain an unrestricted banking
licence, but we will also be raising further interim funding to re-establish
operational readiness as required.
Meanwhile, we will also explore technology licensing, white-labelling and
joint venture opportunities, in the UK and overseas. We remain optimistic that
we can overcome the challenge of securing additional capital and look forward
with excitement to the big picture opportunities that lie ahead.
Dr. Marko Sjoblom
Chief Executive Officer
GROUP STATEMENT OF TOTAL COMPREHENSIVE INCOME
12 months 9 months
ended 31 December ended 31 December
2023 2022
£ £
(7,223,494) (8,218,903)
Administrative expenses
Operating loss
(7,223,494) (8,218,903)
Finance income 46,176 11,596
Finance costs (74,840) (9,970)
Other gains and losses (1,081,530) -
Loss before taxation
(8,333,688) (8,217,277)
Income tax income 16,157 377,879
Loss and total comprehensive loss for the year
(8,317,531) (7,839,398)
Profit for the financial period is all attributable to the owners of the
parent company.
Total comprehensive income for the period is all attributable to the owners of
the parent company.
Earnings per share
Basic (3.06) (3.31)
Diluted (3.06) (3.31)
GROUP STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2023
2023 2022
£ £
ASSETS
Non-current assets
Intangible assets - 878,639
Property, plant and equipment - 276,524
- 1,155,163
Current assets
Trade and other receivables 236,720 660,078
Current tax recoverable - 352,879
Cash and cash equivalents 1,310,757 7,045,161
1,547,477 8,058,118
Total assets
1,547,477 9,213,281
EQUITY
Called up share capital 27,474,724 26,513,186
Share premium account 9,475,486 9,194,313
Own shares (5,100) -
Merger reserve (21,120,782) (21,120,782)
Shares to be issued 50,000 -
Retained earnings (15,048,567) (7,293,795)
Total equity
825,761 7,292,922
Non-controlling interests - -
Total equity 825,761 7,292,922
LIABILITIES
Non-current liabilities
Lease liabilities - 93,425
Current liabilities
Trade and other payables 663,940 1,693,603
Lease liabilities 57,776 133,331
721,716 1,826,934
Total liabilities
721,716 1,920,359
Total equity and liabilities
1,547,477 9,213,281
COMPANY STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2023
2023 2022
£ £
ASSETS
Non-current assets
Right-of-use assets - 224,546
Investments 1,785,857 46,482,583
1,785,857
46,707,129
Current assets
Trade and other receivables 1,262,144 1,801,269
Cash and cash equivalents 5,246 99,078
1,267,390 1,900,347
Total assets
3,053,247 48,607,476
EQUITY
Called up share capital 27,474,724 26,513,186
Share premium account 28,225,487 27,944,314
Own shares (5,100) -
Shares to be issued 50,000 -
Shared based payment reserve 40,218 40,218
Retained earnings (53,141,837) (7,093,177)
Total equity
2,643,492 47,404,541
LIABILITIES
Non-current liabilities
Lease liabilities - 93,425
Current liabilities
Trade and other payables 351,979 976,179
Lease liabilities 57,776 133,331
409,755 1,109,510
Total liabilities
409,755 1,202,935
Total equity and liabilities
3,053,247 48,607,476
As permitted by s408 Companies Act 2006, the Company has not presented its own
income statement and related notes. The Company's loss for the year was
£46,611,419 (2022 - £752,487 loss).
GROUP STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 DECEMBER 2023
Share Capital Share Premium account Own shares Merger Reserve Shares to be issued Retained earnings Total
£ £ £ £ £ £ £
Balance at 1 April 2022 3,758,184 5,189,313 - (5,090,626) - (4,134,550) (277,679)
Period ended 31 December 2022
Loss and total comprehensive loss - - - - - (7,839,398) (7,839,398)
Transactions with owners:
Issue of share capital 4,005,000 4,005,000 - - - - 8,010,000
Share-based payment credit - - - - - 4,680,153 4,680,153
Effect of reverse take-over 18,750,002 - - (16,030,156) - - 2,719,846
Balance at 31 December 2022 26,513,186 9,194,313 - (21,120,782) - (7,293,795) 7,292,922
Period ended 31 December 2023
Loss and total comprehensive loss - - - - - (8,317,531) (8,317,531)
Transactions with owners:
Issue of share capital 961,538 288,462 - - - - 1,250,000
Shares to be issued - - - - 50,000 - 50,000
Shares held by employment benefit trust - - (72,209) - - - (72,209)
Share based payment (7,289) 562,759 555,470
Fair value movement 67,109 67,109
Balance at 31 December 2023 27,474,724 9,475,486 (5,100) (21,120,782) 50,000 (15,048,567) 825,761
COMPANY STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 DECEMBER 2023
Share Capital Share Premium account Revaluation Reserve Share based payment reserve Own shares Shares to be issued Retained earnings Total
£ £ £ £ £ £ £ £
Balance at 1 April 2022 3,758,184 5,189,313 836,265 40,218 - - (7,176,955) 2,647,025
Period ended 31 December 2022
Loss and total comprehensive loss - - - - - (752,487) (752,487)
Transactions with owners:
Issue of share capital 22,755,002 22,755,001 - - - - 45,510,003
Transfer to Revaluation Reserve - - (836,265) - - - 836,265 -
Balance at 31 December 2022 26,513,186 27,944,314 - 40,218 - - (7,093,177) 47,404,541
Period ended 31 December 2023
Loss and total comprehensive loss - - - - - - (46,611,419) (46,611,419)
Transactions with owners:
Issue of share capital 961,538 288,462 - - - - - 1,250,000
Shares to be issued - - - - - 50,000 - 50,000
Own shares acquired transferred to reserves - - - (72,209) - - (72,209)
Share based payment - (7,289) - - - - 562,759 555,470
Fair value movement - - - 67,109 - - 67,109
Balance at 31 December 2023 27,474,724 28,225,487 - 40,218 (5,100) 50,000 (53,141,837) 2,643,492
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 DECEMBER 2023
31 December 31 December
2023
2022
£
£
£ £
Cash flows from operating activities
Cash absorbed by operations (6,647,178) (4,497,027)
Income taxes refunded 369,036 120,150
Net cash used in operating activities
(6,278,142) (4,376,877)
Investing activities
Purchase of intangible assets - (849,076)
Purchase of property, plant and equipment (8,618) (50,457)
Interest received 46,176 11,596
Net cash generated from (used in) investing activities 37,558 (887,937)
Financing activities
Proceeds from issue of shares 500,000 8,010,000
Net cash acquired on reverse takeover - 3,577,275
Proceeds from borrowings 1,000,000 500,000
Repayment of borrowings (750,000) -
Payment of lease liabilities (167,929) (47,533)
Interest paid (75,891) (5,137)
Net cash generated from financing activities 506,180 12,034,605
Net (decrease)/increase in cash and cash equivalents
(5,734,404) 6,769,791
Cash and cash equivalents at beginning of year 7,045,161 275,370
Cash and cash equivalents at end of year
1,310,757 7,045,161
COMPANY STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 DECEMBER 2023
31 December 31 December
2023
2022
£
£
£ £
Cash flows from operating activities
Cash generated from/(absorbed by) operations 649,729 (3,365,399)
Interest paid - 9,970
Net cash inflow/(outflow) from operating activities
649,729 (3,355,429)
Investing activities
Proceeds from disposal of subsidiaries - 1,882,500
Purchase of additional capital in subsidiaries (1,250,000) (8,982,580)
Repayment of loans - 1,050,000
Proceeds from disposal of investments - 951,460
Interest received 9 69,111
Net cash used in investing activities (1,249,991) (5,029,509)
Financing activities
Proceeds from issue of shares 500,000 8,010,000
Proceeds from borrowings 1,000,000 500,000
Repayment of borrowings (750,000 ) -
Payment of lease liabilities (167,929) (42,699)
Interest paid (75,641) (9,970)
Net cash generated from financing activities 506,430 8,457,331
Net (decrease)/increase in cash and cash equivalents
(93,832) 72,393
Cash and cash equivalents at beginning of year 99,078 26,685
Cash and cash equivalents at end of year
5,246 99,078
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1 Material accounting policy information Company information
Fiinu Plc is a public company limited by shares incorporated in England and
Wales. The registered office is Ibex House, Baker Street, Weybridge, Surrey,
KT13 8AH. The Group's principal activity is a fintech group, including Fiinu 2
Limited and is the developer of the Plugin Overdraft® which is an unbundled
overdraft solution that allows customers to have an overdraft with Fiinu Bank
without changing their existing bank. The underlying Bank Independent
Overdraft ® technology platform is bank agnostic, allowing Fiinu Bank to
serve all other banks' customers, subject to raising the required investment
and being successful in the re- application for a UK banking licence. Open
Banking allows Fiinu's Plugin Overdraft® to attach ("plugin") to the
customer's primary bank account, no matter which bank they may use. Fiinu's
vision is built around Open Banking, and it believes that it increases
competition and innovation in UK banking.
This Group consists of Fiinu Plc and all of its subsidiaries.
1.1 Accounting convention
The Group's consolidated and the Company's financial statements are prepared
in accordance with UK- adopted international accounting standards and the
Companies Act 2006 requirements, except as otherwise stated. On publishing the
parent company financial statements here together with the consolidated
financial statements, the company is taking advantage of the exemption in s408
of the Companies Act 2006 not to present its individual statement of profit
and loss. Profit and loss and other comprehensive income and related notes
that form a part of these approved financial statements.
The financial statements are prepared in sterling, which is the functional
currency of the Group. Monetary amounts in these financial statements are
rounded to the nearest £.
The financial statements have been prepared under the historical cost
convention. The principal accounting policies adopted are set out below.
Reverse takeover transactions
On 15 June 2022 The Directors of Immediate Acquisition Plc announced that it
had entered into a Sale and Purchase Agreement to acquire Fiinu Holdings Ltd
which, on account of the relative sizes of the two entities, constituted a
reverse takeover under the London Stock Exchange AIM Rules. As a prelude to
the acquisition, which completed on 7 July 2023, Immediate Acquisition Plc
raised £8.01million in new equity capital. The shares in the enlarged company
were then readmitted to trading on the AIM market on 8 July 2022 under its new
name of Fiinu plc.
Where there has been a reverse takeover, the coming together of the entities
does not constitute a business combination and as such the transaction is
accounted for as, in substance, a capital reorganisation. The accounting
acquirer is different from the legal acquirer. As such, from an accounting
perspective, the previous comparatives and any results prior to the reverse
takeover have not been presented and the assets and liabilities of the
accounting acquirer are recorded in the consolidated financial statements at
their pre- combination amounts. The share capital in the consolidated
financial statements however, reflects that of the legal acquirer.
Fiinu Holdings Ltd has been identified as the accounting acquirer and Fiinu
plc, the legal acquirer. The share capital in the consolidated accounts
reflects that of the legal acquirer, being Fiinu plc. The comparatives, and
any results prior to 8 July 2022 of Fiinu plc have not been presented and the
assets and liabilities of the Fiinu Holdings Limited group have been recorded
in the consolidated financial statements at their pre-combination amounts.
1.2 Basis of consolidation
All financial statements are made up to 31 December 2023. Where necessary,
adjustments are made to the financial statements of subsidiaries to bring the
accounting policies used into line with those used by other members of the
Group.
All intra-group transactions, balances and unrealised gains on transactions
between Group companies are eliminated on consolidation. Unrealised losses are
also eliminated unless the transaction provides evidence of an impairment of
the asset transferred.
Subsidiaries are consolidated in the Group's financial statements from the
date that control commences until the date that control ceases.
Acquisitions are accounted for using the acquisition method. the cost of an
acquisition is measured at fair value at the date of exchange of the
consideration. Identifiable assets and liabilities of the acquired business
are recognised at their fair value at the date of acquisition. To the extent
that the cost of an acquisition exceeds the fair value of the net assets
acquired the difference is recorded as goodwill. Where the fair value of the
net assets acquired exceeds the cost of an acquisition the difference is
recorded in profit and loss.
1.3 Going concern
The financial statements have been prepared on a going concern basis. In
assessing going concern, the Directors have considered the current statement
of financial position, the financial projections, longer-term strategy of the
business and the capital and liquidity plans, including stress tests and plans
for future capital injections.
During the year, the Group reported that it was facing challenges in raising
the full amount of funding required for Fiinu Bank Limited to launch without
regulatory restrictions and commence its banking operations in the UK.
Accordingly, Fiinu Bank Limited applied to withdraw its banking licence with
the aim of re-applying once the Board would be able to attest to the
regulators that the funding is secured.
Following the withdrawal of the banking licence application, Fiinu Bank
changed its name to Fiinu 2 Limited and the Group initiated controlled cost
reductions in order to provide additional time to determine the best way
forward for shareholders.
As at 31 December 2023 the Group had available cash resources of £1.3
million. The Directors have prepared forecasts for a period of at least 12
months from the date of signing of these financial statements. Based on the
current projection, the Directors believe that there are sufficient funds for
the forecast expenditure for at least the next 12 months. However, it is
anticipated that the Group will need to raise capital beyond this period in
order to proceed with its operational strategy. This represents a material
uncertainty that may cast significant doubt on the Group's and company's
ability to continue as a going concern. However, the Directors have a
reasonable expectation that this uncertainty can be managed to a successful
outcome, and based on that assessment, the Group and Company will have
adequate resources to continue in operational existence for the foreseeable
future.
The financial statements do not reflect any adjustments that would be required
to be made if they were to be prepared on a basis other than the going concern
basis.
1.4 Intangible assets other than goodwill
Expenditure on research is recognised as an expense in the period in which it
is incurred.
Cost that are directly attributable to the development phase of new customised
technologies are recognised as intangible assets provided they meet the
following recognition criteria:
· completion of the intangible asset is technically feasible so
that it will be available for use or sale;
· the Group intends to complete the intangible asset and use or sell
it;
· the Group has the ability to use or sell the tangible asset;
· the intangible asset will generate probable future economic benefits.
Among other things, this requires that there is a market for the output from
the intangible asset or the intangible asset itself, or, if it is to be used
internally, the asset will be used in generating such benefits;
· there are adequate technical, financial and other resources to
complete the development and to use or sell the intangible asset; and
· the expenditure attributable to the intangible asset during its
development can be measured reliably.
Development costs not meeting the criteria for capitalisation are recognised
as expenses as incurred.
Amortisation is recognised as an administrative expense in profit or loss on a
straight line basis over the estimated useful lives of intangible assets,
other than goodwill, from the date that they are available for use. The
estimated useful lives for intangible assets are as follows:
Research and development
not yet in use
1.5 Property, plant and equipment
Property, plant and equipment are initially measured at cost and subsequently
measured at cost or valuation, net of depreciation and any impairment losses.
Cost includes expenditures that are directly attributable to the acquisition
of the asset. Purchased software that is integral to the functionality of the
related equipment is capitalised as part of that equipment.
Depreciation is recognised so as to write off the cost or valuation of assets
less their residual values over their useful lives, leased assets are
depreciated over the shorter of the lease term and their useful lives.
Depreciation is recognised on the following bases:
Leasehold
property
Over the period of the lease
Office and IT
equipment 3-10
years
Plant and
equipment
3-7 years
Computers and network equipment 3-5 years or
contract term if shorter
The gain or loss arising on the disposal of an asset is determined as the
difference between the sale proceeds and the carrying value of the asset, and
is recognised in the profit or loss.
1.6 Non-current investments
Interests in subsidiaries, associates and jointly controlled entities are
initially measured at cost and subsequently measured at cost less any
accumulated impairment losses. The investments are assessed for impairment at
each reporting date and any impairment losses or reversals of impairment
losses are recognised immediately in profit or loss.
A subsidiary is an entity controlled by the parent company. Control is the
power to govern the financial and operating policies of the entity so as to
obtain benefits from its activities.
1.7 Borrowing costs
Finance costs comprise interest expense on borrowings including leases which
are recognised in profit or loss in the period in which they are incurred.
1.8 Impairment of tangible and intangible assets
At each reporting end date, the Group reviews the carrying amounts of its
tangible and intangible assets to determine whether there is any indication
that those assets have suffered an impairment loss. If any such indication
exists, the recoverable amount of the asset is estimated in order to determine
the extent of the impairment loss (if any). Where it is not possible to
estimate the recoverable amount of an individual asset, the Group estimates
the recoverable amount of the cash-generating unit to which the asset belongs.
Intangible assets with indefinite useful lives and intangible assets not yet
available for use are tested for impairment annually, and whenever there is an
indication that the asset may be impaired.
1.9 Cash and cash equivalents
Cash and cash equivalents include cash in hand, deposits held at call with
banks, other short-term liquid investments with original maturities of three
months or less, and bank overdrafts. Bank overdrafts are shown within
borrowings in current liabilities.
1.10 Financial assets
Financial assets are recognised in the Group's statement of financial position
when the Group becomes party to the contractual provisions of the instrument.
Financial assets are classified into specified categories, depending on the
nature and purpose of the financial assets.
At initial recognition, financial assets classified as fair value through
profit and loss are measured at fair value and any transaction costs are
recognised in profit or loss. Financial assets not classified as fair value
through profit and loss are initially measured at fair value plus transaction
costs.
Financial assets held at amortised cost
When any of the above-mentioned conditions for classification of financial
assets are not met, a financial asset is classified as measured at fair value
through profit or loss. Financial assets measured at fair value through profit
or loss are recognised initially at fair value and any transaction costs are
recognised in profit or loss when incurred. A gain or loss on a financial
asset measured at fair value through profit or loss is recognised in profit or
loss, and is included within finance income or finance costs in the statement
of income for the reporting period in which it arises.
Financial assets at fair value through profit or loss
When any of the above-mentioned conditions for classification of financial
assets are not met, a financial asset is classified as measured at fair value
through profit or loss. Financial assets measured at fair value through profit
or loss are recognised initially at fair value and any transaction costs are
recognised in profit or loss when incurred. A gain or loss on a financial
asset measured at fair value through profit or loss is recognised in profit or
loss, and is included within finance income or finance costs in the statement
of income for the reporting period in which it arises.
Impairment of financial assets
Financial assets carried at amortised cost are assessed for indicators of
impairment at each reporting end date.
The expected credit losses associated with these assets are estimated on a
forward-looking basis. A broad range of information is considered when
assessing credit risk and measuring expected credit losses, including past
events, current conditions, and reasonable and supportable forecasts that
affect the expected collectability of the future cash flows of the instrument.
For trade receivables, the simplified approach permitted by IFRS 9 is applied,
which requires expected lifetime losses to be recognised from initial
recognition of the receivables.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash
flows from the asset expire, or when it transfers the financial asset and
substantially all the risks and rewards of ownership to another entity.
1.11 Financial liabilities
The Group recognises financial debt when the Group becomes a party to the
contractual provisions of the instruments. Financial liabilities are
classified as either 'financial liabilities at fair value through profit or
loss' or 'other financial liabilities'.
Other financial liabilities
Other financial liabilities, including borrowings, trade payables and other
short-term monetary liabilities, are initially measured at fair value net of
transaction costs directly attributable to the issuance of the financial
liability. They are subsequently measured at amortised cost using the
effective interest method. For the purposes of each financial liability,
interest expense includes initial transaction costs and any premium payable on
redemption, as well as any interest or coupon payable while the liability is
outstanding.
Derecognition of financial liabilities
Financial liabilities are derecognised when, and only when, the Group's
obligations are discharged, cancelled, or they expire.
1.12 Equity instruments
Equity instruments issued by the parent company are recorded at the proceeds
received, net of direct issue costs. Dividends payable on equity instruments
are recognised as liabilities once they are no longer payable at the
discretion of the company.
Share capital represents the nominal value of shares that have been issued.
Share premium includes any premium received on issue of share capital.
Retained losses include retained profits and losses relating to current and
prior years and purchases and sales of own shares by the Employee Benefit
Trust.
All transactions with owners of the parent are recorded separately within
equity.
1.13 Taxation
The tax expense represents the sum of the current tax and deferred tax.
Current tax
The current tax is based on taxable profit for the year. Taxable profit
differs from net profit as reported in the income statement because it
excludes items of income or expense that are taxable or deductible in other
years and it further excludes items that are never taxable or deductible. The
Group's liability for current tax is calculated using tax rates that have been
enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax is the tax expected to be payable or recoverable on differences
between the carrying amounts of assets and liabilities in the financial
statements and the corresponding tax bases used in the computation of taxable
profit, and is accounted for using the balance sheet liability method.
Deferred tax liabilities are generally recognised for all taxable temporary
differences and deferred tax assets are recognised to the extent that it is
probable that taxable profits will be available against which deductible
temporary differences can be utilised. Such assets and liabilities are not
recognised if the temporary difference arises from goodwill or from the
initial recognition of other assets and liabilities in a transaction that
affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end
date and reduced to the extent that it is no longer probable that sufficient
taxable profits will be available to allow all or part of the asset to be
recovered. Deferred tax is calculated at the tax rates that are expected to
apply in the period when the liability is settled or the asset is realised.
Deferred tax is charged or credited in the income statement, except when it
relates to items charged or credited directly to equity, in which case the
deferred tax is also dealt with in equity. Deferred tax assets and liabilities
are offset when the Group has a legally enforceable right to offset current
tax assets and liabilities and the deferred tax assets and liabilities relate
to taxes levied by the same tax authority.
1.14 Employee benefits
The costs of short-term employee benefits are recognised as a liability and an
expense, unless those costs are required to be recognised as part of the cost
of inventories or non-current assets.
The cost of any unused holiday entitlement is recognised in the period in
which the employee's services are received.
Termination benefits are recognised immediately as an expense when the Group
is demonstrably committed to terminate the employment of an employee or to
provide termination benefits.
1.15 Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an
expense as they fall due.
1.16 Leases
At inception, the Group assesses whether a contract is, or contains, a lease
within the scope of IFRS 16. 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. Where a tangible asset is
acquired through a lease, the Group recognises a right-of-use asset and a
lease liability at the lease commencement date. Right-of-use assets are
included within property, plant and equipment, apart from those that meet the
definition of investment property and are recognised for all leases except
those which are considered to have a fair value below £4,500 and those with a
duration of 12 months or less.
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 and an estimate
of the cost of obligations to dismantle, remove, refurbish or restore the
underlying asset and 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
other property, plant and equipment. 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 unpaid 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. Lease payments included in
the measurement of the lease liability comprise fixed payments, variable lease
payments that depend on an index or a rate, amounts expected to be payable
under a residual value guarantee, and the cost of any options that the Group
is reasonably certain to exercise, such as the exercise price under a purchase
option, lease payments in an optional renewal period, or penalties for early
termination of a lease.
1.17 Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the
rates of exchange prevailing at the dates of the transactions. At each
reporting end date, monetary assets and liabilities that are denominated in
foreign currencies are retranslated at the rates prevailing on the reporting
end date. Gains and losses arising on translation in the period are included
in profit or loss.
1.18 Earnings per share
The Group presents basic and diluted earnings per share ("EPS") data for its
ordinary shares. Basic EPS is calculated by dividing the profit or loss
attributable to ordinary shareholders of the company by the weighted average
number of ordinary shares outstanding during the period. Diluted EPS is
determined by adjusting the profit or loss attributable to ordinary
shareholders and the weighted average number of ordinary shares outstanding
for the effects of all dilutive potential ordinary shares, which comprise
share options granted to employees.
1.19 New and amended standards
New and amended standards adopted by the Group
The Group has applied the following amendments for the first time for the
annual reporting period commencing 1 January 2023:
· Insurance Contracts - Amendments to IFRS 17
· Presentation of Financial Statements - Amendments to IAS 1
· Making Materiality Judgements - Disclosure of Accounting Policies -
Amendments to IFRS Practice statement 2
· Income Tax - Amendments to IAS 12
· Accounting Policies, Changes in Accounting Estimates and Errors -
Amendments to IAS 8.
The amendments listed above did not have any impact on the amounts recognised
in prior periods and are not expected to significantly affect the current or
future periods.
New standards and interpretations not yet adopted
At the date of authorisation of these financial statements, the Group has not
applied the following new and revised IFRS Accounting Standards that have been
issued but are not yet effective:
· Sale or Contribution of Assets between an Investor and its Associate
or Joint Venture - Amendments to IFRS 10 and IAS 28
· Classification of Liabilities as Current or Non-current - Amendments
to IAS 1
· Non-current Liabilities with Covenants - Amendments to IAS 1
· Supplier Finance Arrangements - Amendments to IAS 7 and IFRS 7
· Lease Liability in a Sale and Leaseback - Amendments to IFRS 16
The Directors do not expect that the adoption of the Standards listed above
will have a material impact on the financial statements of the Group in future
periods.
2. Earnings per share
31 December 31 December
2023 2022
Number Number
Number of shares
Weighted average number of ordinary shares in issue 274,747,246 237,184,397
Less weighted average number of own shares (192,323) -
Weighted average number of ordinary shares for basic earnings per share
274,554,923 237,184,397
Weighted average number of ordinary shares for diluted earnings per share 274,554,932 237,184,397
31 December 31 December
2023 2022
Earnings £ £
Continuing operations
Loss for the period from continued operations (8,317,531) (7,839,398)
2023 2022
Pence per Pence per
share share
Basic and diluted earnings per share
From continuing operations (3.06) (3.31)
Basic earnings per share is calculated by dividing the earnings attributable
to ordinary shareholders by the weighted average number of shares outstanding
during the year.
For diluted earnings per share, the weighted average number of shares in issue
is adjusted to assume conversion of all potentially dilutive warrants and
options over ordinary shares. Potential ordinary shares resulting from the
exercise of warrants and options have an anti-dilutive effect due to the Group
being in a loss position. As a result, dilutive loss per share is disclosed as
the same value as basic loss per share.
3. Events after the reporting date
There are no events to report after the reporting date.
4. Financial information in this Announcement
The financial information presented in this announcement does not comprise the
statutory accounts for the Group for the financial years ended 31 December
2023 and 31 December 2022, but extracts from them. The Annual Report and
Accounts for the year ended 31 December 2023, together with the Notice of
Annual General Meeting, will be despatched to shareholders shortly and will be
available to download from the Company's website a
thttps://fiinuplc.com/annual-and-interim-reports.
~ ENDS ~
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