REG - TMT Investments - Final Results and Notice of AGM
19/03/2024 07:00
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RNS Number : 3213H TMT Investments PLC 19 March 2024
19 March 2024
TMT INVESTMENTS PLC
("TMT" or the "Company")
Results for the year ended 31 December 2023 and Notice of AGM
TMT Investments Plc (AIM: TMT), the venture capital company investing in
high-growth technology companies, is pleased to announce its audited final
results for the year ended 31 December 2023.
Highlights:
· NAV per share of US$6.62 (up 3.3% from US$6.41 as of 31 December
2022)
· Total NAV of US$208.1 million (US$201.7 million as of 31 December
2022)
· 5-year IRR of 16.3% per annum
· US$4.7 million of investments across 10 new and existing companies in
2023
· Praktika.AI became the 100(th) investment by TMT since inception
· US$4.2 million of profitable disposals during the period
· US$11.0 million in cash and cash equivalent reserves as of 18 March
2024
Alexander Selegenev, Executive Director of TMT, commented:
"In line with the technology companies' market, in 2023 TMT's portfolio has
continued to see an increased divergence between the stronger and weaker
performers - with the net result for TMT being positive, with the Company's
NAV per share increasing by 3.3% in 2023. TMT's portfolio benefited from the
positive revaluation of 12 of its companies (Backblaze, 3S Money, 1Fit,
Collectly, SonicJobs, Mobilo, Synder, Educate Online, Laundryheap, Whizz,
AgendaPro, and Scentbird).
During the same period TMT partially or fully wrote down the value of twelve
of its investments, which have either struggled to adjust to the new
"down-to-earth" reality or failed, with some smaller investees, who in the
past were able to rely on the availability of cheap capital for continued
funding requirements succumbing to market pressure.
TMT's five largest holdings (Bolt, Backblaze, 3S Money, PandaDoc and
Scentbird) continued to perform well, with each recording double-digit annual
revenue growth rates. These are mostly well capitalised companies, with
generally high levels of cash reserves, a strong market presence and are
typically either already operationally profitable or close to achieving
profitability. These well-established companies accounted for 64% of TMT's
portfolio's value as of 31 December 2023.
Continuing the trends started in 2022, 2023 saw a dramatic change in the
venture capital and technology company environment, with most investors
"returning to basics" by backing ultimately profitable business models at
sensible valuations. The previous "growth at any cost" approach, which TMT
has always structurally avoided, has now been firmly replaced with a focus on
"fundamentally profitable growth at the right valuation". As a result,
start-ups' success/survival rate has been largely defined by their ability to
reposition and adjust to this changed market environment.
We continue to see a number of outstanding companies that are thriving in this
changed market environment, and are attracting large levels of funding thanks
to their strong business models and execution. We have therefore continued
to make investments selectively in such companies, deploying a total of US$4.7
million across current and new portfolio companies in 2023, as well as a
further US$1.0 million invested after the reporting period. Some of these
investee companies announced the completion of large funding rounds in 2023,
including Rain, which raised US$116m, and ON (previously known as GameON),
which raised US$25m, with Forta announcing it had raised US$55m in January
2024, placing them on a well-funded path to continued growth.
TMT has capitalised on the continued share price strength of NASDAQ-traded
Backblaze by disposing US$4.2 million-worth of Backblaze shares after the
reporting period.
In order to provide shareholders with what we believe prudent and consistent
valuations for our investments, TMT continues to prioritise the use of quoted
prices and demonstrable corporate actions, such as recent fundraises, to
calculate its portfolio NAVs, typically applying comparable analysis only, as
is necessary, when writing down investments. Noting this approach, and given
the current market backdrop, we are pleased to have delivered an increase in
NAV in 2023, thanks largely to our rigorous and disciplined investment
approach. With no financial debt and cash and cash equivalent reserves of
US$11.0 million as of 18 March 2024, TMT is well positioned to ride out the
current market volatility and to continue investing in companies that meet our
investment criteria as fully as possible, while disposing of our investments
whenever there is an opportunity to maximise shareholder value."
Notice of AGM
The Company's Annual General Meeting will be held on 28 May 2024 at 13 Castle
Street, St. Helier, Jersey, JE1 1ES at 14:30 (BST).
Copies of the Annual Report and Accounts for the year ended 31 December 2023
("Annual Report") and Notice of AGM will shortly be available on the Company's
website at www.tmtinvestments.com (http://www.tmtinvestments.com) .
For further information contact:
TMT Investments Plc +44 370 707 4040
Alexander Selegenev (Computershare - Company Secretary)
Executive Director alexander.selegenev@tmtinvestments.com
(mailto:alexander.selegenev@tmtinvestments.com)
www.tmtinvestments.com (http://www.tmtinvestments.com)
Strand Hanson Limited +44 (0)20 7409 3494
(Nominated Adviser)
James Bellman / James Dance
Cavendish Capital Markets Limited +44 (0)20 7220 0500
(Joint Broker)
Ben Jeynes / George Lawson
Hybridan LLP +44 (0)20 3764 2341
(Joint Broker)
Claire Louise Noyce
Kinlan Communications +44 (0)20 7638 3435
David Hothersall davidh@kinlan.net (mailto:davidh@kinlan.net)
The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulation
(EU) No. 596/2014 as it forms part of United Kingdom domestic law by virtue of
the European Union (Withdrawal) Act 2018, as amended by virtue of the Market
Abuse (Amendment) (EU Exit) Regulations 2019.
About TMT Investments Plc
TMT Investments Plc invests in high-growth technology companies globally
across a number of core specialist sectors. Founded in 2010, TMT has a
current investment portfolio of over 50 companies and net assets of US$208
million as of 31 December 2023. The Company's objective is to generate an
attractive rate of return for shareholders, predominantly through capital
appreciation. The Company is traded on the AIM market of the London Stock
Exchange. www.tmtinvestments.com (http://www.tmtinvestments.com) .
Twitter (https://twitter.com/TMT_PLC)
LinkedIn (http://www.linkedin.com/company/tmt-investments-plc)
Facebook (https://www.facebook.com/TmtInvestmentsPlc/)
EXECUTIVE DIRECTOR'S STATEMENT
In 2023, the venture capital markets generally continued to experience a
higher degree of market and economic volatility.
Investors' increased focus on start-ups' profitability has created a "survival
of the fittest" market environment. On the one hand, companies with superior
products and business models that have continued to grow and improve
profitability continue to attract new capital at higher valuations. On the
other hand, companies with weaker business models or non-mission critical
products that were more dependent on future funding have come under increased
pressure.
In line with the market, TMT's portfolio has continued to see an increased
divergence between the stronger and weaker performers. Despite the ongoing
challenges in the macroeconomic and political environment, investors in 2023
continued to back fast-growing, high-quality digital technology companies.
We were pleased to see 3S Money, 1Fit, Collectly, SonicJobs, Mobilo, Synder,
Educate Online, Laundryheap, Whizz, and AgendaPro receive further validation
of their progress by raising fresh capital at higher valuation levels. These
are companies operating in "tried and tested" sectors that benefit from
well-established revenues and spending habits, be they, for example, payments,
education, accounting software or laundry services, rather than seeking to
devise completely new revenue streams. These portfolio companies are
successfully competing and gaining market share against incumbents by adding
significant value, be it through more efficient technology, better service,
consolidation or other benefits. The combination of these factors, together
with nimble execution and a focus on profitability, placed them in a
favourable position to successfully raise fresh capital.
The value of TMT's equity stake in NASDAQ-traded cloud storage company
Backblaze (www.backblaze.com (http://www.backblaze.com) ), varied during the
period, partly driven by the volatility in the share prices of many publicly
traded technology companies. Based on Backblaze's closing mid-market price
of US$7.59 per share as of 29 December 2023, TMT's stake in Backblaze recorded
a US$5.4 million increase in value compared to 31 December 2022. Backblaze's
business has been developing well, recording 20% revenue growth in 2023
compared to 2022. Backblaze remains sufficiently capitalised, with an
estimated net debt position of approximately US$3 million as of 31 December
2023. TMT availed itself of the opportunity provided by Backblaze's improved
share price to dispose of approximately 8% of its shares in Backblaze during
2023 for a total consideration of US$2.1 million. Backblaze's closing
mid-market price on 15 March 2024 was US$10.04 per share.
TMT adopts a highly prudent approach to valuing its portfolio investments and
therefore regularly reviews and writes down investments that are not showing
the progress TMT believes is required to justify the previously reported
valuation level. As a result, during the period TMT partially or fully wrote
down the value of twelve of its investments (excluding the additional
write-downs related purely to exchange rate fluctuations). This resulted in
US$16 million of partial and full write downs.
In December 2023, TMT made its 100(th) investment since TMT's inception in
2010. Over the period since inception, the Company has generated a number of
landmark multi-million dollar exits, US$105 million-worth of full and partial
profitable disposals, four unicorns and a 16% annual IRR (internal rate of
return). At the end of December 2023, 64% of TMT's portfolio value was
accounted for by its five largest holdings. These are companies with
strongly established business models, with a strong market presence and
expanding, and typically either already operationally profitable or close to
achieving profitability. The remainder of the portfolio is made up of
companies in their early and mid-stages, a number of which are making
admirable progress in the current environment. This means that TMT's
portfolio today is a far cry from its make-up of earlier-stage start-ups in
the early years.
NAV per share
The Company's NAV per share in 2023 increased by 3.3% to US$6.62 as of 31
December 2023 (31 December 2022: US$6.41), mainly as a result of the upward
revaluation of Backblaze and Collectly during the period.
Operating expenses
In 2023, the Company's administrative expenses of US$1.3 million were below
the corresponding 2022 figure of US$1.4 million, reflecting the Company's
reduced level of investment and business development activities during the
period.
Financial position
As of 31 December 2023, the Company had no financial debt and cash and cash
equivalent reserves of US$6.6 million (31 December 2022: US$10.1 million).
As of 18 March 2024, the Company had cash and cash equivalent reserves of
US$11.0 million.
Outlook
TMT has a diversified investment portfolio of over 50 companies, focused
primarily on Big Data/Cloud, SaaS (software-as-a-service), Mobility, and
FinTech.
Despite the ongoing market and political volatility, investors continue to
invest in high-quality technology businesses at the appropriate valuation
levels. TMT is continuing to identify such opportunities very selectively,
whilst employing a generally cautious investment approach. With no financial
debt and cash and cash equivalent reserves of US$11.0 million as of 18 March
2024, TMT is well positioned to ride out the current market volatility and to
continue making investments and realising full and partial disposals when the
right opportunities present themselves.
Alexander Selegenev
Executive Director
18 March 2024
PORTFOLIO DEVELOPMENTS
The following developments have had an impact on, and are reflected in, the
Company's NAV and/or financial statements as of 31 December 2023 in accordance
with applicable accounting standards.
Profitable full and partial cash exits, and positive revaluations:
· In January and March 2023, TMT received a total additional US$1.6
million in dividends from Hugo, as part of the consideration for Hugo's
disposal of its food delivery and quick commerce business in Central America
to Delivery Hero completed in 2022.
· In February 2023, TMT received US$0.3 million from Backblaze, Inc.,
as a settlement payment in respect of TMT's additional investment in Backblaze
in 2021. In addition, TMT disposed of 8% of its equity stake in Backblaze in
2023, for a total net consideration of US$2.1 million.
The following of the Company's portfolio investments were positively revalued
as of 31 December 2023:
Portfolio company Portfolio company description Positive revaluation amount (US$) As % of fair value reported as of 31 Dec 2022 Basis for revaluation
Backblaze, Inc. NASDAQ-listed cloud storage and data back-up company (www.backblaze.com 5,361,766 23% Based on the closing mid-market price of US$7.59 per share on 29 December 2023
(http://www.backblaze.com) ) (incl. US$0.3m settlement and US$2.1m partial disposal proceeds received in
2023)
Collectly, Inc. Patient billing platform for medical organisations (www.collectly.co 4,389,328 213% New funding round (equity)
(http://www.collectly.co) )
3S Money Club Limited Provider of global business bank account and payment solutions (www.3s.money 3,016,809* 21% New funding round (equity)
(http://www.3s.money) )
Educate Online Inc. Distance education platform for children and young adults aged 4-19 1,847,458 185% New funding round (simple agreement for future equity ("SAFE"))
(www.educate-online.io (http://www.educate-online.io) )
CloudBusiness Inc., trading as Synder Accounting software solution (www.synder.com (http://www.synder.com) ) 1,368,571 66% New funding round (SAFE)
Alippe, Inc., trading as 1Fit Mobile app providing users with access to multiple gyms and yoga studios in 1,080,320 216% New funding round (SAFE)
Central Asia (https://1fit.app (https://1fit.app) )
Laundryheap On-demand laundry and dry-cleaning services (https://www.laundryheap.co.uk/ 993,810* 55% New funding round (equity)
(https://www.laundryheap.co.uk/) )
My Device Inc., trading as Whizz Device-as-a-service e-bike rental company (www.getwhizz.com 739,241 70% New funding round (equity)
(http://www.getwhizz.com) ),
Lulu Systems, Inc., trading as Mobilo Smart digital business card solution (www.mobilocard.com 470,000 46% New funding round (SAFE)
(http://www.mobilocard.com) )
Scentbird, Inc. Perfume subscription service (www.scentbird.com (http://www.scentbird.com) ) 418,646 6% Independent 3(rd) party secondary share sale transaction
AgendaPro, Inc. SaaS-based scheduling, payment and marketing solution for the beauty and 395,609 77% New funding round (SAFE)
wellness industry in Latin America (www.agendapro.com
(http://www.agendapro.com) )
SonicJobs App Ltd. Job search app focused on "blue collar" positions (www.sonicjobs.com 283,666* 46% New funding round (equity)
(http://www.sonicjobs.com) ),
Total 20,365,224
* - incl. foreign exchange effect
In addition, the following of TMT's non-USD denominated investments increased
in value due to favourable exchange rate movements as of 31 December 2023:
Bolt, Timbeter, Feel, Hinterview, MTL (Outfund), FemTech, Outvio, EstateGuru,
and Bairro.
Negative revaluations:
The following of the Company's portfolio investments were negatively revalued
as of 31 December 2023:
Portfolio Company Write-down amount (US$) Reduction as % of fair value reported as of 31 Dec 2022 Reasons for write-down
Muncher 2,853,697 50% Business negatively affected by the recent market conditions
PandaDoc 2,830,644 26% Valuation adjusted based on an independent secondary share sale offer received
by TMT
Bafood 2,500,000 100% Business negatively affected by exposure to Ukraine and changed market
conditions in the sector
Rocket Games (Legion Farm) 1,650,000 100% Disappointing performance during the year; prospects unclear
Conte.ai (Postoplan) 1,628,090 100% Business negatively affected by the recent market conditions
Scalarr 1,378,282 100% Business negatively affected by the recent market conditions and staff's
exposure to Ukraine
Metrospeedy 1,000,000 100% Business negatively affected by the current economic environment and changed
market conditions in the sector
Qumata 909,411 50% Limited progress with the previous product; a pivot is underway
Wanelo 602,447 100% No response from the company in the last two years; limited website
functionality; assumed zero equity value
Academy of Change 330,000 100% Final write-off due to lack of progress in repositioning the business. Company
is being liquidated.
Go X 175,000 50% Limited progress in the last two years; prospects unclear
ClassTag 101,965 25% Cash exit transaction completed in August 2023, with US$0.28 million (94% of
the total cash consideration due to TMT) received to date
Total 15,959,536
In addition, TMT's non-USD denominated investment in eAgronom decreased in
value due to exchange rate fluctuations as of 31 December 2023.
Key developments for the five largest portfolio holdings in the first half of
2023 (source: TMT's portfolio companies):
Bolt (ride-hailing and food delivery service):
· Active in over 550 cities globally (up from over 500 cities as of 31
December 2022)
· Double-digit revenue growth
· Announced plans to achieve profitability in 2024 and potentially float
in 2025
Backblaze (cloud storage provider):
· Double-digit revenue growth
· Multiple new integrations and partnerships building basis for future
growth
· Positive adjusted EBITDA achieved in Q4 2023
3S Money (provider of global business account and payment solutions):
· Double-digit revenue growth
· Regulatory permissions obtained in Luxemburg, Dubai and Singapore
· EBITDA positive
PandaDoc (proposal automation and contract management software):
· Double-digit revenue growth
· Over 50,000 customers (from over 40,000 as of 31 December 2022)
· Acquired Berlin-based fintech start-up Denario in a move to further
accelerate its growth into a leading all-in-one document and payment workflow
platform
Scentbird (Perfume, wellness and beauty product subscription service):
· Double-digit revenue growth
· EBITDA positive
Further investments:
Given the persistently high level of market uncertainty and volatility, TMT
continued to be more selective and made the following investments in 2023:
Follow-on investments during the reporting period:
· €150,000 in Bairrissimo, LDA, trading as Bairro, an instant food and
grocery delivery company in Portugal (https://bairro.io (https://bairro.io) );
· US$100,000 in Cyberwrite, an AI cyber insurance platform providing
cybersecurity insights and risk quantification for businesses worldwide
(www.cyberwrite.com (http://www.cyberwrite.com) );
· £45,861 in FemTech, a London-based technology accelerator focused on
female founders (www.femtechlab.com (http://www.femtechlab.com) );
· US$500,000 in Alippe, Inc., trading as 1Fit, a mobile app providing
users with access to multiple gyms and yoga studios in Central Asia
(https://1fit.app (https://1fit.app) ); and
· US$200,000 in Lulu Systems, Inc., trading as Mobilo, a smart digital
business card solution (www.mobilocard.com (http://www.mobilocard.com) ).
New investments during the reporting period:
· US$500,000 in Phoenix Health Inc., a Canada-based direct-to-consumer
health platform for men (www.phoenix.ca (http://www.phoenix.ca) );
· US$1,000,000 in GameOn Inc., an AI chat platform that powers
conversational experiences for fashion, sport and retail brands and teams
(www.gameontechnology.com (http://www.gameontechnology.com) );
· US$700,000 in Montera, Inc., trading as Forta, a family-powered
autism therapy platform (www.fortahealth.com (http://www.fortahealth.com) );
· US$1,000,000 in Rain Technologies Inc., a provider of easy and
instant access to earned wages (www.rainapp.com (http://www.rainapp.com) );
and
· US$400,000 in Praktika.AI, a language learning app with personal AI
avatar tutors (www.praktika.ai (http://www.praktika.ai) ).
New investments after the reporting period
· US$1,000,000 in Propertymate Inc., trading as NewHomesMate, a marketplace
for newly built homes (www.newhomesmate.com (http://www.newhomesmate.com) )
Other events after the reporting period
In January 2024, TMT received a total additional US$1.5 million in dividends
from Hugo, as part of the consideration for Hugo's disposal of its food
delivery and quick commerce business in Central America to Delivery Hero
completed in 2022.
TMT disposed a part of its shares in NASDAQ-traded Backblaze for a total net
consideration of US$4.2 million.
CORPORATE GOVERNANCE STATEMENT
The Board fully endorses the importance of good corporate governance and has
adopted the 2018 Quoted Companies Alliance Corporate Governance Code for Small
and Mid-Sized Companies (the "QCA Code"), which the Board believes to be the
most appropriate corporate governance code given the Company's size, stage of
development and AIM-traded status. The QCA Code is a practical,
outcome-oriented approach to corporate governance that is tailored for small
and mid-size quoted companies in the UK and which provides the Company with
the framework and effective oversight to help ensure that a strong level of
governance is maintained.
In accordance with the QCA Code and AIM Rule 26, a report providing a
high-level overview of how TMT has applied the principles of the QCA Code and
any areas in which the Company's governance structures and practices depart
from or differ from the expectations of the QCA Code can be found within the
Company's Annual Report and will be available on the Company's website
following publication.
DIRECTORS' REPORT FOR THE YEAR ENDED 31 DECEMBER 2023
The Directors present their report and audited financial statements of the
Company for the year ended 31 December 2023.
Principal activity and review of the business
TMT Investments Plc ("TMT" or the "Company") was incorporated under the laws
of Jersey. The Company has been established for the purpose of making
investments in the TMT sector where the Directors believe there is a potential
for growth and the creation of shareholder value. The Company primarily
targets companies operating in markets that the Directors believe have strong
growth potential and having the potential to become multinational
businesses. The Company can invest in any region of the world.
Results and dividends
The profit for the year amounted to US$6,377,773 (2022: loss of
US$81,393,833), which includes a profit on changes in fair value of financial
assets at Fair Value through profit and loss ("FVPL") of US$7,341,554 (2022:
loss of US$79,638,928).
Further information on the Company's results and financial position is
included in the financial statements.
The board has decided that it will not recommend a final dividend (2022: nil).
Company listing
TMT is traded on the AIM market ("AIM") of the London Stock Exchange. The
Company's ticker is TMT. Information required by AIM Rule 26 is available in
the 'Investor Relations' section of the Company's website at
www.tmtinvestments.com (http://www.tmtinvestments.com) .
Board meetings
Three Board meetings, two meeting of the Audit Committee, and one meeting of
the Remuneration Committee were held in 2023. The number of meetings attended
by the Directors is set out below.
Director Board meetings Audit Committee meetings Remuneration Committee meetings Nomination Committee meetings
Yuri Mostovoy 3 - - -
Alexander Selegenev 1 - - -
Andrea Nastaj 3 2 1 -
James Mullins 3 2 1 -
Total meetings 3 2 1 -
Changes in share capital
The Company has one class of ordinary share that carries no right to fixed
income, and each share carries the right to one vote at general meetings of
the Company. As at 31 December 2023 and the date of this report, the
Company's issued share capital consisted of 31,451,538 ordinary shares of no
par value each in the Company.
Substantial shareholdings
The Directors are aware of the following shareholdings of 3% or more of the
issued share capital of the Company as of 18 March 2024.
Shareholders Number of ordinary shares % of issued ordinary share capital
Macmillan Trading Company Limited 7,076,058 22.50%
Wissey Trade & Invest Ltd 5,000,000 15.90%
Ramify Consulting Corp 4,728,576 15.03%
Zaur Ganiev 2,443,810 7.77%
Canaccord Genuity Group Inc 2,154,939 6.85%
Merit Systems Inc. 2,054,865 6.53%
Menostar Holdings Limited 1,503,489 4.78%
Eclectic Capital Limited 1,224,442 3.89%
Others 5,265,359 16.75%
Total 31,451,538 100.00%
Concert Party
A concert party, as defined in the City Code on Takeovers and Mergers (the
"Code"), currently exists, consisting of the following shareholders:
Shareholder (legal holder) Beneficial holder No. of Ordinary Shares % of issued share capital
(if different to legal holder)
Macmillan Trading Company Limited ("Macmillan") Alexander Morgulchik 45.05%, German Kaplun 37.17%, Artemii Iniutin 17.78% 7,076,058 22.50%
Wissey Trade & Invest Ltd ("Wissey") Andrey Kareev 5,000,000 15.90%
Ramify Consulting Corp. ("Ramify") German Kaplun 4,728,576 15.03%
Merit Systems Inc. Artemii Iniutin 2,054,865 6.53%
Menostar Holdings Limited ("Menostar") Dmitry Kirpichenko 1,503,489 4.78%
Eclectic Capital Limited ("Eclectic") Nika Kirpichenko 1,224,442 3.89%
Natalia Inyutina (Adult daughter of Artemii Iniutin) 727,156 2.31%
Artemii Iniutin 380,877 1.21%
Vlada Kaplun (Adult Daughter of German Kaplun) 363,578 1.16%
Marina Kedrova (Adult Daughter of German Kaplun) 363,578 1.16%
German Kaplun 138,938 0.44%
Alexander Morgulchik 138,938 0.44%
Total 23,700,495 75.36%
Since September 2013, when the Company became subject to the Code, the concert
party has been interested in, in aggregate, more than 50% of the Company's
issued share capital at all times.
The total direct and indirect interest in TMT by the concert party's
beneficial holders are as follows:
Beneficial holder No. of Ordinary Shares % of issued share capital
German Kaplun 7,497,458 23.84%
Andrey Kareev 5,000,000 15.90%
Artemii Iniutin 3,694,092 11.75%
Alexander Morgulchik 3,326,702 10.58%
Dmitry Kirpichenko 1,503,489 4.78%
Nika Kirpichenko 1,224,442 3.89%
Natalia Inyutina 727,156 2.31%
Vlada Kaplun 363,578 1.16%
Marina Kedrova 363,578 1.16%
Total 23,700,495 75.36%
NOTES:
The majority of the ordinary shares held by Eclectic were previously held by
Menostar, who invested in the Company at the time of its Admission. The
beneficial owner of Eclectic is Nika Kirpichenko who is the wife of Dmitry
Kirpichenko, the beneficial owner of Menostar. Wissey and Menostar both
invested in the Company on its Admission and, along with Eclectic, have
invested in and/or been otherwise involved with other business ventures
associated with the two founders of the Company Alexander Morgulchik and
German Kaplun.
The Company will update this disclosure in future annual financial reports
and, if relevant, via RNS announcements.
Directors
During the financial year the following Directors held office:
Yuri
Mostovoy
Non-executive Chairman
Alexander
Selegenev
Executive Director
James Joseph
Mullins
Independent Non-Executive Director
Andrea
Nastaj
Independent Non-Executive Director
The Directors' fees for 2023 and 2022 were as follows:
Director 2023 2022
USD USD
Yuri Mostovoy 56,250 55,000
Alexander Selegenev 113,750 110,000
James Joseph Mullins 28,077 27,081
Petr Lanin - 9,347
Andrea Nastaj 18,741 10,738
Subsequent events post the period end
In January 2024, TMT received a total additional US$1.5 million in dividends
from Hugo, as part of the consideration for Hugo's disposal of its food
delivery and quick commerce business in Central America to Delivery Hero
completed in 2022.
TMT invested US$1,000,000 in Propertymate Inc., trading as NewHomesMate, a
marketplace for newly built homes (www.newhomesmate.com
(http://www.newhomesmate.com) )
TMT disposed a part of its shares in NASDAQ-traded Backblaze for a total net
consideration of US$4.2 million.
Statement of Directors' responsibilities in respect of the annual report and
the financial statements
The Directors are responsible for preparing the Annual Report and Accounts in
accordance with applicable law and UK-adopted International Financial
Reporting Standards ("IFRSs").
The Companies (Jersey) Law 1991 (as amended) ("Companies Law") requires the
Directors to prepare financial statements for each financial year. The
Directors are responsible for keeping adequate accounting records that are
sufficient to show and explain the Company's transactions and disclose with
reasonable accuracy at any time the financial position of the Company and
enable them to ensure that its financial statements comply with the Companies
Law. They have general responsibility for taking such steps as are
reasonably open to them to safeguard the assets of the Company and to prevent
and detect fraud and other irregularities.
The Directors are responsible for the preparation of the Directors' report and
corporate governance statement. The Directors are responsible for the
maintenance and integrity of the corporate and financial information included
on the Company's website. Legislation in Jersey governing the preparation
and dissemination of financial statements may differ from legislation in other
jurisdictions.
The Directors must not approve the financial statements unless they are
satisfied that they give a true and fair view of the state of affairs of the
Company and of the profit or loss for that period. In preparing these
financial statements, the Directors are required to:
· select suitable accounting policies and then apply them
consistently;
· make judgements and accounting estimates that are reasonable
and prudent;
· state whether applicable UK-adopted IFRSs have been followed,
subject to any material departures disclosed and explained in the financial
statements; and
· prepare the financial statements on the going concern basis unless
it is inappropriate to presume that the Company will continue in business.
Directors' responsibility statement
Each of the Directors, whose names are listed in the Directors section above
confirm that, to the best of each person's knowledge and belief:
· the financial statements, prepared in accordance with
UK-adopted IFRSs, give a true and fair view of the assets, liabilities,
financial position and profit or loss of the Company; and
· the Directors' report contained in the annual report includes a true
and fair review of the development and performance of the business and the
position of the Company.
Going concern
The Directors confirm that, after giving due consideration to the financial
position and expected cash flows of the Company; they have a reasonable
expectation that the Company will have adequate cash resources to continue in
operational existence for the foreseeable future, and for at least one year
from the date of approval of these financial statements and they have
therefore adopted the going concern basis in preparing the financial
statements.
Disclosure of information to auditors
Each of the persons who is a Director at the date of approval of this annual
report confirms that:
· so far as the Directors are aware, there is no relevant audit
information of which the Company's auditors are unaware; and
· the Directors have taken steps that they ought to have taken
to make themselves aware of any relevant audit information and to establish
that the auditors are aware of that information.
The Company's auditors will be proposed for reappointment at the Company's
next scheduled AGM.
On behalf of the Board of Directors
Alexander Selegenev
Executive Director
18 March 2024
FINANCIAL STATEMENTS
Statement of Comprehensive Income
For the year ended For the year ended
31/12/2023
31/12/2022
Notes USD USD
Gains/(Losses) on investments 3 7,357,560 (79,864,874)
Dividend income 36,883 105,844
Total investment income/(loss) 7,394,443 (79,759,030)
Expenses
Administrative expenses 5 (1,322,882) (1,443,395)
Operating gain/(loss) 6,071,561 (81,202,425)
Finance income, net 7 263,441 9,729
Currency exchange gain/(loss) 42,771 (201,137)
Gain/(Loss) before taxation 6,377,773 (81,393,833)
Taxation 8 - -
Gain/(Loss) attributable to equity shareholders 6,377,773 (81,393,833)
Total comprehensive income/(loss) for the year 6,377,773 (81,393,833)
Gain/(Loss) per share
Basic and diluted gain/(loss) per share (cents per share) 9 20.28 (258.78)
Statement of Financial Position
Company registration number: 106628 (Jersey)
At 31 December At 31 December
2023 2022
Notes USD USD
Non‑current assets
Financial assets at FVPL 10 203,086,676 195,260,535
Total non‑current assets 203,086,676 195,260,535
Current assets
Trade and other receivables 11 151,908 1,382,811
Cash and cash equivalents 12 6,590,935 10,102,683
Total current assets 6,742,843 11,485,494
Total assets 209,829,519 206,746,029
Current liabilities
Trade and other payables 13 1,717,816 5,012,099
Total current liabilities 1,717,816 5,012,099
Total liabilities 1,717,816 5,012,099
Net assets 208,111,703 201,733,930
Equity
Share capital 14 53,283,415 53,283,415
Retaining earnings 154,828,288 148,450,515
Total equity 208,111,703 201,733,930
Statement of Cash Flows
For the year ended For the year ended
31/12/2023
31/12/2022
Notes USD USD
Operating activities
Gain/(Loss) attributable to equity shareholders 6,377,773 (81,393,833)
Adjustments for non‑cash items:
Changes in fair value of financial assets at FVPL 3 (7,341,554) 79,638,928
Interest received (263,441) (9,729)
Impairment of receivables 52,510 249,060
(1,174,712) (1,515,574)
Changes in working capital:
Decrease in trade and other receivables 11 1,178,393 418,778
Decrease in trade and other payables 13 (3,294,283) (4,892,724)
Net cash used in operating activities (3,290,602) (5,989,520)
Investing activities
Purchase of financial assets at FVPL 10 (4,686,489) (9,608,593)
Proceeds from sale/disposal of financial assets at FVPL 10 4,201,902 163,266
Interest received on treasury bills and deposits 7 263,441 9,729
Net cash used in investing activities (221,146) (9,435,598)
Decrease in cash and cash equivalents (3,511,748) (15,425,118)
Cash and cash equivalents at the beginning of the year 10,102,683 25,527,801
Cash and cash equivalents at the end of the year 12 6,590,935 10,102,683
Statement of Changes in Equity
For the year ended 31 December 2022 and for the year ended 31 December 2023,
USD
Share capital Retained earnings Total
Note USD USD USD
Balance at 31 December 2021 53,283,415 229,844,348 283,127,763
Comprehensive loss
Loss for the year - (81,393,833) (81,393,833)
Total comprehensive loss for the year - (81,393,833) (81,393,833)
Balance at 31 December 2022 53,283,415 148,450,515 201,733,930
Gain for the year - 6,377,773 6,377,773
Total comprehensive income for the year - 6,377,773 6,377,773
Balance at 31 December 2023 53,283,415 154,828,288 208,111,703
The financial statements were approved by the Board of Directors on 18 March
2024 and were signed on its behalf by:
Alexander Selegenev
Executive Director
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
1. Company information
TMT Investments Plc ("TMT" or the "Company") is a company incorporated in
Jersey with its registered office at 13 Castle Street, St Helier, Jersey, JE1
1ES, Channel Islands.
The Company was incorporated and registered on 30 September 2010 in Jersey
under the Companies (Jersey) Law 1991 (as amended) with registration number
106628 under the name TMT Investments Limited. The Company obtained consent
from the Jersey Financial Services Commission pursuant to the Control of
Borrowing (Jersey) Order 1985 on 30 September 2010. On 1 December 2010 the
Company re‑registered as a public company and changed its name to TMT
Investments Plc. The Company's ordinary shares were admitted to trading on
the AIM market of the London Stock Exchange on 10 December 2010.
The memorandum and articles of association of the Company do not restrict its
activities and therefore it has unlimited legal capacity. The Company's
ability to implement its Investment Policy and achieve its desired returns
will be limited by its ability to identify and acquire suitable investments.
Suitable investment opportunities may not always be readily available.
The Company seeks to make investments in any region of the world. The Company
invests in high‑growth technology companies globally across a number of core
specialist sectors. The Company's objective is to generate an attractive
rate of return for shareholders, predominantly through capital appreciation.
Financial statements of the Company are prepared by and approved by the
Directors in accordance with International Financial Reporting Standards,
UK‑adopted International Accounting Standards and their interpretations
issued or adopted by the International Accounting Standards Board ("IFRSs").
The Company's accounting reference date is 31 December.
2. Summary of significant accounting policies
2.1. Basis of presentation
The principal accounting policies applied by the Company in the preparation of
these financial statements are set out below and have been applied
consistently.
The financial statements have been prepared on a going concern basis, under
the historical cost basis as modified by the fair value of financial assets at
FVPL, as explained in the accounting policies below, and in accordance with
IFRS. Historical cost is generally based on the fair value of the
consideration given in exchange for assets.
The preparation of financial statements, in compliance with UK adopted
International Accounting Standards, requires the use of certain critical
accounting estimates. It also requires management to exercise judgment in
applying the Company's accounting policies (see note 2.12).
2.2. Going concern
The Directors confirm that, after giving due consideration to the financial
position and expected cash flows of the Company and due to availability of
highly liquid investments readily realisable for cash should this be needed;
they have a reasonable expectation that the Company will have adequate cash
resources to continue in operational existence for the foreseeable future, and
for at least one year from the date of approval of these financial statements
and they have therefore adopted the going concern basis in preparing the
financial statements.
2.3. Segmental reporting
Operating segments are reported in a manner consistent with the internal
reporting provided to the chief operating decision‑maker who is responsible
for allocating resources and assessing performance of the operating segments
and which has been identified as the Board that make strategic decisions.
For the purposes of IFRS 8 'Operating Segments' the Company currently has one
segment, being 'Investing in the TMT sector'.
Even though the Company only invests in the TMT sector, there are still
geographical disclosures that need to be made to comply with IFRS 8 'Operating
Segments'.
2.4. Foreign currency translation
Functional and presentation currency
Items included in the financial statements of the Company are measured in
United States Dollars ('US dollars', 'USD' or 'US$'), which is the Company's
functional and presentation currency.
Transactions and balances
Foreign currency transactions are translated into US$ using the exchange rates
prevailing at the dates of the transactions. Foreign currency monetary items
are translated using the closing rate (i.e. mid‑market price investments).
Non‑monetary items that are measured at fair value in a foreign currency are
translated using the exchange rates at the date when the fair value was
measured. (i.e. comparable company analysis and cost‑based investments as
these are effectively re‑fair valued at each year‑end).
Exchange differences arising from the translation at the year‑end exchange
rates of monetary assets and liabilities denominated in foreign currencies are
recognised in the statement of comprehensive income.
Conversion rates, USD
Currency As at Average rate,
31.12.2023
2023
British pounds 1.2747 1.2393
Euro 1.1047 1.0862
2.5. Cash and cash equivalents
Cash and cash equivalents consist of cash at bank and in hand, deposits held
at call with banks, and other short‑term highly liquid investments with
maturities of three months or less from the date of acquisition.
2.6. Financial assets and liabilities
Recognition and measurement
The Company recognises financial assets and liabilities when it becomes party
to the contractual provisions of the instrument. Financial assets are
derecognised when the contractual rights to the cash flows from the financial
asset expire, or when the financial asset and substantially all the risks and
rewards are transferred. A financial liability is derecognised when it is
extinguished, discharged, cancelled or expires. Financial assets are initially
measured at fair value adjusted for transaction costs (where applicable).
Financial assets are classified into the following categories:
· amortised cost;
· fair value through profit or loss (FVPL); and
· fair value through other comprehensive income (FVOCI).
In the periods presented, the Company did not have any financial assets
categorised as FVOCI. The classification is determined by both:
· the entity's business model for managing the financial asset; and
· the contractual cash flow characteristics of the financial asset.
Subsequent measurement
FVPL
All financial investments of the Company are measured at fair value through
profit or loss and are subject to a fair value revaluation at year end date.
The Company manages its investments with a view of profiting from the receipt
of dividends and changes in fair value of equity investments. Financial assets
of the Company comprise of listed and unlisted equity investments, convertible
promissory notes and SAFEs. All the financial assets are not for trading and
are classified as financial assets at FVPL. Directly attributable transaction
costs are recognised in profit or loss as incurred. Financial assets at fair
value through profit or loss are measured at fair value, and changes therein
are recognised in profit or loss.
When measuring the fair value of a financial instrument, the Company uses
relevant transactions during the year or shortly after the year end, which
gives an indication of fair value and considers other valuation methods to
provide evidence of value. The "price of recent investment" methodology is
used mainly for venture capital investments, and the fair value is derived by
reference to the most recent financing round or sizeable partial disposal.
Fair value change is only recognised if that round involved a new external
investor. From time to time, the Company may assess the fair value in the
absence of a relevant independent transaction by relying on other market
observable data and valuation techniques, such as the analysis of comparable
companies and/or comparable transactions. The nature of such valuation
techniques is highly judgmental and dependent on the market sentiment at the
time of the analysis.
Fair values are categorised into different levels in a fair value hierarchy
based on the inputs used in the valuation techniques as follows:
Level 1: The fair value of financial instruments traded in active markets is
based on quoted market prices at the end of the reporting period. The quoted
market price used for financial assets held by the Company is the mid‑market
price at the time. These instruments are included in level 1.
Level 2: The fair value of financial instruments that are not traded in an
active market is determined using valuation techniques which maximise the use
of observable market data and rely as little as possible on entity specific
estimates. Specific valuation techniques used to value financial instruments
include the use of quoted market prices or dealer quotes for similar
instruments.
Level 3: If one or more of the significant inputs is not based on observable
market data, the instrument is included in level 3.
Transfers between levels of the fair value hierarchy, for the purpose of
preparing these financial statements, are deemed to have occurred at the
beginning of the reporting period.
Where an active market is established for an investment it is classified to
level 1 with a mid‑market price valuation methodology applied. Where
observable market data becomes available for an investment, including for
comparable companies within an active market, it is classified to level 2 with
comparable company analysis used as the valuation methodology. The investment
otherwise remains classified to level 3, with the cost of investment or price
of recent investment valuation methodology applied.
Financial assets that qualify as an associate, as 20% or more of the voting
rights are held by the company, are exempt from IAS 28 'Investments in
Associates', as TMT is a venture capital organisation. Such investments are
therefore treated as financial assets at FVPL.
Financial assets at amortised cost
Financial assets are measured at amortised cost if the assets meet the
following conditions:
· they are held within a business model whose objective is to hold the
financial assets and collect its contractual cash flows; and
· the contractual terms of the financial assets give rise to cash flows
that are solely payments of principal and interest on the principal amount
outstanding.
After initial recognition, these are measured at amortised cost using the
effective interest method. Discounting is omitted where the effect of
discounting is immaterial. The Company's cash and cash equivalents, trade and
other receivables fall into this category of financial instruments.
Impairment of Financial Assets
In relation to the impairment of financial assets, IFRS 9 requires an expected
credit loss model to be applied. The expected credit loss model requires the
Company to account for expected credit losses and changes in those expected
credit losses at each reporting date to reflect changes in credit risk since
initial recognition of the financial assets. IFRS 9 requires the Company to
recognise a loss allowance for expected credit losses on receivables. In
particular, IFRS 9 requires the Company to measure the loss allowance for a
financial instrument at an amount equal to the lifetime expected credit losses
(ECL) if the credit risk on that financial instrument has increased
significantly since initial recognition, or if the financial instrument is a
purchased or originated credit‑impaired financial asset. However, if the
credit risk on a financial instrument has not increased significantly since
initial recognition, the Company is required to measure the loss allowance for
that financial instrument at an amount equal to 12 months ECL.
Income
Interest income from convertible notes receivable is recognised as it accrues
by reference to the principal outstanding and the effective interest rate
applicable, which is the rate that exactly discounts the estimated future cash
flows through the expected life of the financial asset to the asset's carrying
value.
2.7. Net finance income
Net finance income comprises interest income on deposits, bank balances and
other cash equivalents. Interest income is recognised as it accrues in the
statement of comprehensive income, using the effective interest method.
2.8. Taxation
The tax currently payable is based on taxable profit for the year. Taxable
profit differs from net profit as reported in the profit and loss account
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 company's liability for current tax is calculated using tax
rates that have been enacted or substantively enacted by the reporting end
date.
Deferred tax is provided in full using the liability method, on temporary
differences arising between the tax bases of assets and liabilities and their
carrying amounts in the financial statements. Deferred tax is not accounted
for if it arises from initial recognition of an asset or liability in a
transaction other than a business combination that, at the time of the
transaction, affects neither accounting nor taxable profit or loss. Deferred
tax is determined using tax rates that are expected to apply when the related
deferred tax asset is realised or when the deferred tax liability is
settled. Deferred tax assets are recognised to the extent that it is
probable that future taxable profits will be available against which the
temporary differences can be utilised.
The Company is incorporated in Jersey. There are not any tax expenses
recognised in the Statement of comprehensive income as the Company's current
income tax rate in Jersey is 0%.
2.9. Equity instruments
Ordinary shares are classified as equity. Costs directly attributable to the
issue of new shares are shown in equity as a deduction from the proceeds.
2.10. New IFRSs and interpretations
The following standards and amendments became effective from 1 January 2023,
but did not have any impact on the Company:
· IFRS 17 Insurance Contracts;
· Amendments to IFRS 17 - Initial Application of IFRS 17 & IFRS 9
(Comparative Information);
· Amendments to IAS 1 ‑ Presentation of Financial Statements
(Classification of Liabilities as Current or Non‑current);
· Amendments to IAS 1 and IFRS Practice Statement 2 - Making
Materiality Judgements (Disclosure of Accounting Policies);
· Amendments to IAS 12 - Income Taxes (Deferred Tax related to Assets
and Liabilities arising from a Single Transaction);
· Amendments to IAS 8 - Accounting Policies, Changes in Accounting
Estimates and Errors (Definition of Accounting Estimates).
2.11. Future IFRS changes
The following table summarises changes to IFRS adoption which is mandatory for
periods beginning in 2024 and beyond:
Standard Effective date Overview
Amendment to IFRS 16 - Leases on sale and leaseback 1 January 2024 (early adoption permitted) These amendments include requirements for sale and leaseback transactions in
IFRS 16 to explain how an entity accounts for a sale and leaseback after the
date of the transaction. Sale and leaseback transactions where some or all the
lease payments are variable lease payments that do not depend on an index or
rate are most likely to be impacted.
Amendment to IAS 1 - Non‑current liabilities with covenants 1 January 2024 (early adoption permitted) These amendments clarify how conditions with which an entity must comply
within twelve months after the reporting period affect the classification of a
liability. The amendments also aim to improve information an entity provides
related to liabilities subject to these conditions.
Amendment to IAS 7 and IFRS 7 ‑ Supplier finance 1 January 2024 (early adoption permitted) These amendments require disclosures to enhance the transparency of supplier
finance arrangements and their effects on an entity's liabilities, cash flows
and exposure to liquidity risk. The disclosure requirements are the IASB's
response to investors' concerns that some companies' supplier finance
arrangements are not sufficiently visible, hindering investors' analysis.
Amendments to IAS 21 ‑ Lack of Exchangeability 1 January 2024 (early adoption permitted) An entity is impacted by the amendments when it has a transaction or an
operation in a foreign currency that is not exchangeable into another currency
at a measurement date for a specified purpose. A currency is exchangeable when
there is an ability to obtain the other currency (with a normal administrative
delay), and the transaction would take place through a market or exchange
mechanism that creates enforceable rights and obligations.
These changes are not expected to have any impact on the Company in 2024 and
beyond.
2.12. Accounting estimates and judgements
Estimates and judgements need to be regularly evaluated and are based on
historical experience and other factors, including expectations of future
events that are believed to be reasonable under the circumstances. The
Company makes estimates and assumptions concerning the future. The resulting
accounting estimates will, by definition, rarely equal the related actual
results.
The estimates and underlying assumptions are reviewed on an on‑going
basis. Revisions to accounting estimates are recognised in the period in
which the estimate is revised if the revision affects only that period or in
the period of the revision and future periods if the revision affects both
current and future periods.
The estimates significant to the financial statements during the year and at
the year‑end is the consideration of the fair value of financial assets at
FVPL as set out in the relevant accounting policies shown above. A number of
the financial assets at FVPL held by the Company are at an early stage of
their development. The Company cannot yet carry out regular reliable fair
value estimates of some of these investments. Future events or transactions
involving the companies invested in may result in more accurate valuations of
their fair values (either upwards or downwards) which may affect the Company's
overall net asset value.
As summarised in note 10 the Company has investments held at year‑end of
US$96,422,492 (2022: US$94,755,170) classified as level 2 in the fair value
hierarchy, valued on a comparable company analysis basis. The Company has a
further US$80,653,740 (2022: US$77,512,433) classified as level 3, valued at
cost or price of recent investment (less any currency exchange‑related
impairment charges). Generally, when impairments are used in the comparable
company valuation methodology, impairments are allocated on a 50%‑66% basis
when management determine that there is increased uncertainty over the
investee's business prospects and/or exit strategy, or a 100% basis when
management determine that the investment is unlikely to be recovered. Readers
of these financial statements should consider the inherent uncertainty
principle involved when considering these investment valuations.
3. Gains/(Losses) on investments
For the year ended For the year ended
31/12/2023
31/12/2022
USD USD
Gross interest income from convertible notes receivable 6,213 40,012
Net interest income from convertible notes receivable 6,213 40,012
Gains/(Losses) on changes in fair value of financial assets at FVPL 7,341,554 (79,638,928)
Impairment of receivables (52,510) (249,060)
Other gains/(losses) on investment 62,303 (16,898)
Total net gains/(losses) on investments 7,357,560 (79,864,874)
During the year ended 31 December 2023, impairment losses related to
receivables for previously disposed investments of US$52,510 were recognised
(2022: US$249,060).
4. Segmental analysis
Geographic information
The Company has investments in the following geographic areas: the USA,
Canada, Estonia, the United Kingdom, Portugal, BVI and the Cayman Islands.
Non‑current financial assets
USA and Canada Cayman Islands BVI Estonia Cyprus United Kingdom Portugal Total
As at 31/12/ 2023 USD USD USD USD USD USD USD USD
Equity investments 73,579,189 - 1,695,398 74,200,126 - 34,987,820 - 184,462,533
Convertible notes & SAFEs 16,517,060 1,030,000 - - - - 1,077,083 18,624,143
Total 90,096,249 1,030,000 1,695,398 74,200,126 - 34,987,820 1,077,083 203,086,676
USA and Canada Cayman Islands BVI Estonia Cyprus United Kingdom Portugal Total
As at 31/12/ 2022 USD USD USD USD USD USD USD USD
Equity investments 66,393,603 - 3,255,052 71,759,682 330,000 30,481,358 - 172,219,695
Convertible notes & SAFEs 14,800,030 1,030,000 - 1,628,090 4,100,000 601,950 880,770 23,040,840
Total 81,193,633 1,030,000 3,255,052 73,387,772 4,430,000 31,083,308 880,770 195,260,535
5. Administrative expenses
Administrative expenses include the following amounts:
For the year ended For the year ended
31/12/2023
31/12/2022
USD USD
Staff expenses (note 6) 845,218 825,366
Professional fees 270,695 326,651
Legal fees 26,818 82,941
Bank and LSE charges 16,507 15,069
Audit fees 50,985 59,577
Accounting fees 20,070 17,480
Other expenses 92,589 116,311
1,322,882 1,443,395
6. Staff expenses
For the year ended For the year ended
31/12/2023
31/12/2022
USD USD
Directors' fees 216,818 212,166
Wages and salaries 628,400 613,200
845,218 825,366
Wages and salaries shown above include fees and salaries relating to the year
ended 31 December 2023.
The Directors' fees for 2023 were as follows:
For the year ended For the year ended
31/12/2023
31/12/2022
USD USD
Alexander Selegenev 113,750 110,000
Yuri Mostovoy 56,250 55,000
James Joseph Mullins 28,077 27,081
Petr Lanin - 9,347
Andrea Nastaj 18,741 10,738
216,818 212,166
The Directors' fees shown above are all classified as 'short term employment
benefits' under International Accounting Standard 24. The Directors do not
receive any pension contributions or other benefits. The average number of
staff employed (excluding Directors) by the Company during the year was 7
(2022: 7).
Key management personnel of the Company are defined as those persons having
authority and responsibility for the planning, directing and controlling the
activities of the Company, directly or indirectly. Key management of the
Company are therefore considered to be the Directors of the Company. There
were no transactions with the key management, other than their fees and
reimbursement of business expenses.
Under the Company's Bonus Plan, subject to achieving a minimum hurdle NAV and
high watermark conditions, the team receives an annual cash bonus equal to 10%
of the net increases in the Company's NAV, adjusted for any changes in the
Company's equity capital resulting from issuance of new shares, dividends,
share buy‑backs and similar corporate transactions. The Company`s bonus year
runs from 1 January to 31 December. As the Company's adjusted NAV did not
exceed the previously achieved high watermark during the financial year, no
bonus accrued for the year ended 31 December 2023.
7. Net finance income
For the year ended For the year ended
31/12/2023
31/12/2022
USD USD
Interest income 263,441 9,729
263,441 9,729
8. Income tax expense
The Company is incorporated in Jersey. No tax reconciliation note has been
presented as the Company's current income tax rate in Jersey is 0%.
9. Gain/(Loss) per share
The calculation of basic gain per share is based upon the net losses for the
year ended 31 December 2023 attributable to the ordinary shareholders of
US$6,377,773 (2022: net loss of US$81,393,833) and the weighted average number
of ordinary shares outstanding calculated as follows:
Gain per share For the year ended For the year ended
31/12/2023
31/12/2022
Basic gain/(loss) per share (cents per share) 20.28 (258.78)
Gain/(Loss) attributable to equity holders of the entity 6,377,773 (81,393,833)
The weighted average number of ordinary shares outstanding was calculated as
follows:
For the year ended For the year ended
31/12/2023
31/12/2022
Weighted average number of shares in issue
Ordinary shares 31,451,538 31,451,538
31,451,538 31,451,538
10. Non‑current financial assets
Reconciliation of fair value measurements of non‑current financial assets:
At 31 December 2023 At 31 December 2022
Investments held at fair value through profit and loss, USD:
‑ listed and unlisted shares (i) 184,462,533 172,219,695
‑ promissory notes (ii) 1,600,030 4,830,070
‑ SAFEs (iii) 17,024,113 18,210,770
203,086,676 195,260,535
At 31 December 2023 At 31 December 2022
USD USD
Opening valuation 195,260,535 265,454,136
Purchases (including consulting fees) 4,686,489 9,608,593
Disposal proceeds (4,201,902) (163,266)
Impairment losses in the year (10,289,184) (1,280,016)
Realised loss 1,098,401 -
Unrealised gains/(losses) 16,532,337 (78,358,912)
Closing valuation 203,086,676 195,260,535
Movement in unrealised gains/(losses)
Opening accumulated unrealised gains 118,262,354 195,706,888
Unrealised gains/(losses) 16,532,337 (78,358,912)
Transfer of previously unrealised gains/(losses) to realised reserve on (1,605,184) 914,378
disposal of investments
Closing accumulated unrealised gains 133,189,507 118,262,354
Reconciliation of investments, if held under the cost and price of recent
investment model:
Historic cost basis
Opening book cost 76,998,181 69,747,248
Purchases (including consulting fees) 4,686,489 9,608,593
Disposals on sale of investment (1,498,317) (57,660)
Impairment losses in the year (10,289,184) (2,300,000)
Closing book cost 69,897,169 76,998,181
Valuation methodology
Level 1 ‑ Mid‑market price 26,010,444 22,992,932
Level 2 ‑ Comparable company analysis 96,422,492 94,755,170
Level 3 ‑ Cost or price of recent investment 80,653,740 77,512,433
203,086,676 195,260,535
The estimates significant to the financial statements during the year and at
the year‑end is the consideration of the fair value of financial assets at
FVPL as set out in the relevant accounting policies shown above. A number of
the financial assets at FVPL held by the Company are at an early stage of
their development. The Company cannot yet carry out regular reliable fair
value estimates of some of these investments. Future events or transactions
involving the companies invested in may result in more accurate valuations of
their fair values (either upwards or downwards) which may affect the Company's
overall net asset value.
Valuation methodologies can be changed from time to time, the following table
shows the changes made for 2023 compared to 2022. These investments were held
at cost or price of recent investments of the total value of US$7,876,217 as
of 31 December 2022:
Company name 2023 2022
Cheetah (Go‑X) Comparable company analysis Cost and price of recent investment
Muncher Comparable company analysis Cost and price of recent investment
Qumata Comparable company analysis Cost and price of recent investment
The following table shows the changes made for 2022 compared to 2021. These
investments were held at cost or price of recent investments of the total
value of US$133,457,069 as of 31 December 2021:
Company name 2022 2021
3D Look Comparable company analysis Cost or price of recent investment
Affise Comparable company analysis Cost or price of recent investment
Academy of change Comparable company analysis Cost or price of recent investment
Bolt Comparable company analysis Cost or price of recent investment
EstateGuru Comparable company analysis Cost or price of recent investment
MEL Science Comparable company analysis Cost or price of recent investment
Moeco Comparable company analysis Cost or price of recent investment
PandaDoc Comparable company analysis Cost or price of recent investment
Scalarr Comparable company analysis Cost or price of recent investment
Study Space, Inc (EdVibe) Comparable company analysis Cost or price of recent investment
Wanelo Comparable company analysis Cost or price of recent investment
The list of fully impaired investments, in which the Company still maintained
ownership as of 31 December 2023, was as follows:
Company name Investment Year of
amount (USD)
impairment
Rollapp 350,000 2018
UsingMiles/Help WW/Source Inc. 250,000 2018
Favim 300,000 2018
AdInch 1,000,000 2018
E2C 124,731 2020
Drupe 225,000 2019
Virool/Turgo 600,000 2017
Sixa 900,000 2019
Usual Beverage Co. 300,000 2022
StudyFree 1,000,000 2022
Wanelo 355,000 2023
Rocket Games (Legionfarm) 1,650,000 2023
Scalarr 1,999,999 2023
Academy of change 1,000,000 2023
Conte.ai/Postoplan 1,784,185 2023
Metrospeedy 1,000,000 2023
BaFood 2,500,000 2023
Total 15,338,915
Financial assets at fair value through profit or loss are measured at fair
value, and changes therein are recognised in profit or loss.
When measuring the fair value of a financial instrument, the Company uses
relevant transactions during the year or shortly after the year end, which
gives an indication of fair value and considers other valuation methods to
provide evidence of value. The "price of recent investment" methodology is
used mainly for venture capital investments, and the fair value is derived by
reference to the most recent financing round or sizeable partial disposal.
Fair value change is only recognised if that round or partial disposal
involved a new external investor. From time to time, the Company may assess
the fair value in the absence of a relevant independent transaction by relying
on other market observable data and valuation techniques, such as the analysis
of comparable companies and/or comparable transactions. The nature of such
valuation techniques is highly judgmental and dependent on the market
sentiment at the time of the analysis.
(i) Equity investments as at 31 December 2023:
Investee company Date of initial investment Value at 1 Jan 2023, USD Additions to equity investments during the period, USD Conversions from loan notes and SAFEs, USD Gain/loss from changes in fair value of equity investments, USD Disposals, USD Value at 31 Dec 2023, USD Fully diluted equity stake owned
Wanelo 21.11.2011 602,447 - - (602,447) - - <5%
Backblaze 24.07.2012 22,992,931 - - 5,361,765 (2,344,253) 26,010,443 5‑10%
Remote.it 13.06.2014 131,200 - - - - 131,200 <5%
Bolt 15.09.2014 69,756,984 - - 2,424,114 - 72,181,098 <5%
PandaDoc 11.07.2014 10,844,468 - - (2,830,644) - 8,013,824 <5%
Full Contact 11.01.2018 244,506 - - - - 244,506 <5%
Scentbird 13.04.2015 6,590,954 - - 418,646 - 7,009,600 <5%
Workiz 16.05.2016 3,971,659 - - - - 3,971,659 <5%
Hugo 19.01.2019 3,255,052 - - (40) (1,559,614) 1,695,398 <5%
MEL Science 25.02.2019 905,656 - - - - 905,656 <5%
Qumata 06.06.2019 1,818,822 - - (909,411) - 909,411 <5%
eAgronom 31.08.2018 454,678 - - (37,465) - 417,213 <5%
Rocket Games (Legionfarm) 16.09.2019 200,000 - - (200,000) - - <5%
Timbeter 05.12.2019 213,520 - - 7,420 - 220,940 <5%
Classtag 03.02.2020 200,000 - 200,000 (101,965) (298,035) - <5%
3S Money Club 07.04.2020 14,090,596 - - 3,016,809 - 17,107,405 10‑15%
Hinterview 21.09.2020 812,730 - - 47,796 860,526 <5%
Virtual Mentor (Allright) 12.11.2020 772,500 - - - - 772,500 <5%
NovaKid 13.11.2020 2,949,855 - - - - 2,949,855 <5%
MTL Financial (OutFund) 17.11.2020 2,565,918 - - 150,899 - 2,716,817 <5%
Scalarr 15.08.2019 1,378,282 - - (1,378,282) - - 5‑10%
Accern 21.08.2019 2,873,884 - - - - 2,873,884 <5%
Feel 13.08.2020 3,653,220 - - 214,842 - 3,868,062 10‑15%
Affise 18.09.2019 1,795,680 - - - - 1,795,680 5‑10%
3D Look 03.03.2021 500,000 - - - - 500,000 <5%
FemTech 30.03.2021 810,606 55,084 - 51,017 - 916,707 5‑10%
Muncher 23.04.2021 3,707,395 - 2,000,000 (2,853,697) - 2,853,698 5‑10%
CyberWrite 20.05.2021 975,741 100,000 - - - 1,075,741 <5%
Outvio 22.06.2021 533,800 - - 18,550 - 552,350 <5%
Collectly 07.06.2023 - - 6,449,328 - - 6,449,328 <5%
VertoFX 16.07.2021 1,132,999 - - - - 1,132,999 <5%
Academy of change 02.08.2021 330,000 - - (330,000) - -
EstateGuru 06.09.2021 800,700 - - 27,825 - 828,525 <5%
Prodly 09.09.2021 1,800,000 - - - - 1,800,000 <5%
Sonic Jobs 15.09.2021 620,009 - - 283,666 - 903,675 <5%
EdVibe (Study Space, Inc) 02.11.2021 750,000 - - - - 750,000 5‑10%
1Fit (Alippe, Inc) 24.12.2021 500,000 - - 1,080,320 - 1,580,320 <5%
Agendapro 03.09.2021 515,000 - - 395,609 - 910,609 <5%
Laundryheap 28.01.2022 1,203,801 - 601,950 993,810 - 2,799,561 <5%
My Device Inc 30.11.2021 - - 1,789,241 - - 1,789,241 5‑10%
SOAX 21.01.2022 4,000,000 - - - - 4,000,000 5‑10%
Spin.ai 17.12.2018 964,102 - - - - 964,102 <5%
Total 172,219,695 155,084 11,040,519 5,249,137 (4,201,902) 184,462,533
(ii) Convertible loan notes as at 31 December 2023:
Investee company Date of initial investment Value at 1 Jan 2023, USD Additions to convertible note investments during the period, USD Conversions to equity, USD Gain/loss from changes in fair value of convertible loan notes, USD Disposals, USD Value at 31 Dec 2023, USD
Sharethis 26.03.2013 570,030 - - - - 570,030
Conte.ai/ Postoplan 08.12.2020 1,628,090 - - (1,628,090) - -
Metrospeedy 16.07.2021 1,000,000 - - (1,000,000) - -
MedVidi 27.09.2021 1,030,000 - - - - 1,030,000
Laundryheap 21.11.2022 601,950 - (601,950) - - -
Total 4,830,070 - (601,950) (2,628,090) - 1,600,030
(iii) SAFEs as at 31 December 2023:
Investee company Date of initial investment Value at 1 Jan 2023, USD Additions to SAFE investments during the period, USD Conversions to equity, USD Gain/loss from changes in fair value of SAFE investments, USD Disposals, USD Value at 31 Dec 2023, USD
Cheetah (Go‑X) 29.07.2019 350,000 - - (175,000) - 175,000
Adwisely (Retarget) 24.09.2019 1,600,000 - - - - 1,600,000
Rocket Games (Legionfarm) 17.09.2019 1,450,000 - - (1,450,000) - -
Classtag 03.02.2020 200,000 - (200,000) - - -
Moeco 08.07.2020 500,000 - - - - 500,000
Aurabeat 03.05.2021 1,030,000 - - - - 1,030,000
Synder (CloudBusiness Inc) 26.05.2021 2,060,000 - - 1,368,571 - 3,428,571
Collectly 13.07.2021 2,060,000 - (6,449,328) 4,389,328 - -
OneNotary (Adorum) 01.10.2021 500,000 - - - - 500,000
BaFood 05.11.2021 2,500,000 - - (2,500,000) - -
Educate online 16.11.2021 1,000,000 - - 1,847,458 - 2,847,458
My Device Inc 30.11.2021 1,050,000 - (1,789,241) 739,241 - -
Mobilo (Lulu Systems, Inc) 09.12.2021 1,030,000 200,000 - 470,000 - 1,700,000
Muncher 13.12.2021 2,000,000 - (2,000,000) - - -
Bairro 12.01.2022 880,770 165,405 - 30,909 - 1,077,084
1Fit (Alippe, Inc) 19.04.2023 - 500,000 - - - 500,000
GameOn 19.06.2023 - 1,030,000 - - - 1,030,000
Phoenix 29.05.2023 - 515,000 - - - 515,000
Montera 02.08.2023 - 721,000 - - - 721,000
Rain Technologies Inc. 17.10.2023 - 1,000,000 - - - 1,000,000
Praktika.ai 29.12.2023 - 400,000 - - - 400,000
Total 18,210,770 4,531,405 (10,438,569) 4,720,507 - 17,024,113
11. Trade and other receivables
At 31 December 2023 At 31 December 2022
USD USD
Prepayments 60,914 42,550
Other receivables 18,145 1,219,506
Interest receivable on promissory notes 66,917 113,214
Interest receivable on deposit 5,932 7,541
151,908 1,382,811
The fair value of trade and other receivables approximate to their carrying
amounts as presented above.
Other receivables as of 31 December 2023 represented amounts due from the
disposed investment in Classtag.
12. Cash and cash equivalents
The cash and cash equivalents as at 31 December 2023 included cash and cash
equivalents in banks and brokers.
Cash and cash equivalents comprised the following:
At 31 December 2023 At 31 December 2022
USD USD
Treasury bills 1,732,693 -
Deposits 1,164,380 2,502,188
Bank balances 3,693,862 7,600,495
6,590,935 10,102,683
The following table represents an analysis of cash and equivalents by rating
agency designation based on Moody`s rating or their equivalent:
At 31 December 2023 At 31 December 2022
Bank balances USD USD
C rating 119,041 7,587,687
Caa2 rating 3,566,010 -
Baa3 rating 1,736 2,447
Not rated 7,075 10,361
3,693,862 7,600,495
At 31 December 2023 At 31 December 2022
Deposits USD USD
A1 rating 1,164,380 2,502,188
1,164,380 2,502,188
At 31 December 2023 At 31 December 2022
Treasury bills USD USD
AAA rating 1,732,693 -
1,732,693 -
13. Trade and other payables
At 31 December 2023 At 31 December 2022
USD USD
Salaries payable 16,000 81,838
Directors' fees payable 12,622 66,100
Bonuses payable 1,638,709 4,817,785
Trade payables 10,156 7,702
Other current liability 162 3,307
Accruals 40,167 35,367
1,717,816 5,012,099
The fair value of trade and other payables approximate to their carrying
amounts as presented above.
14. Share capital
On 31 December 2023 the Company had an authorised share capital of unlimited
ordinary shares of no par value and had issued ordinary share capital of:
At 31 December 2023 At 31 December 2022
USD USD
Share capital 53,283,415 53,283,415
Issued capital comprises: Number Number
Fully paid ordinary shares 31,451,538 31,451,538
Number of shares Number of shares
Balance at 31 December 2022 31,451,538 31,451,538
Issue of ordinary shares - -
Balance at 31 December 2023 31,451,538 31,451,538
15. Capital management
The capital structure of the Company consists of equity share capital,
reserves, and retained earnings.
The Board's policy is to maintain a strong capital base so as to maintain
investor and market confidence and to enable the successful future development
of the business.
The Company is not subject to externally imposed capital requirements.
No changes were made to the objectives, policies and process for managing
capital during the year.
16. Financial risk management and financial instruments
The Company has identified the following risks arising from its activities and
has established policies and procedures to manage these risks. The Company's
principal financial assets are cash and cash equivalents, investments in
equity shares, and convertible notes receivable.
Credit risk
As at 31 December 2023 the largest exposure to credit risk related to
convertible notes receivable and SAFEs (US$18,624,143, as at 31 December 2022
‑ US$23,040,840), and cash and cash equivalents (US$6,590,935, as at 31
December 2022 ‑ US$10,102,683).
The Company's exposure to credit risk is influenced mainly by the individual
characteristics of each investee company. The credit quality of investments in
equity shares and convertible promissory notes is based on the financial
performance of the individual portfolio companies. For those assets that are
not impaired it is believed that the risk of default is small and that capital
repayments and interest payments will be made in accordance with the agreed
terms and conditions of the Company's investment. In other cases, an
appropriate asset impairment is recorded to reflect the fair value. The
exposure to credit risk is approved and monitored on an on‑going basis
individually for all significant investee companies.
The exposure risk is reduced because the counterparties are banks with high
credit ratings ("BBB+" Liquidity banks) assigned by international credit
rating agencies. The Directors intend to continue to spread the risk by
holding the Company's cash reserves in more than one financial institution.
(i) Exposure to credit risk
The carrying amount of the following assets represents the maximum credit
exposure. The maximum exposure to credit risk as at 31 December was as
follows:
At 31 December 2023 At 31 December 2022
USD USD
Convertible notes receivable & SAFEs 18,624,143 23,040,840
Trade and other receivables 151,908 1,382,811
Cash and cash equivalents 6,590,935 10,102,683
25,366,986 34,526,334
Market risk
The Company's financial assets are classified as financial assets at FVPL. The
measurement of the Company's investments in equity shares and convertible
notes is largely dependent on the underlying trading performance of the
investee companies, but the valuation and other items in the financial
statements can also be affected by fluctuations in interest and currency
exchange rates.
Interest rate risk
Changes in interest rates impact primarily cash and cash equivalents by
changing either their fair value (fixed rate deposits) or their future cash
flows (variable rate deposits). Management does not have a formal policy of
determining how much of the Company's exposure should be to fixed or variable
rates. At 31 December 2023 the Company had cash deposit of USD 4,730,390 (as
at 31 December 2022 ‑ US$2,502,188), earning a variable rate of interest.
The Board of Directors monitors the interest rates available in the market to
ensure that returns are maximized.
Foreign currency risk management
The Company is exposed to foreign currency risks on investments and salary and
director remuneration payments that are denominated in a currency other than
the functional currency of the Company. The currency giving rise to this
risk is primarily GBP and EUR. The exposure to foreign currency risk as at 31
December 2023 was as follows:
At 31 December 2023 At 31 December 2023 At 31 December 2022 At 31 December 2022
GBP EUR GBP EUR
Current assets
Cash and cash equivalents 84,373 8,775 171,705 177,998
Current liabilities
Trade and other payables (15,162) - (14,861) -
Net (short) long position 69,211 8,775 156,844 177,998
Net exposure currency 54,296 7,943 130,280 166,727
Net exposure currency (assuming a 10% movement in exchange rates) 62,290 7,897 141,160 160,198
Impact on exchange movements in the statement of comprehensive income 6,921 878 15,684 17,800
The foreign exchange rates of the USD at 31 December were as follows:
31/12/2023 31/12/2022
Currency
British pounds 1.2747 1.2039
Euro 1.1047 1.0676
This analysis assumes that all other variables, in particular interest rates,
remain constant.
Fair value and liquidity risk management
The Company's approach to managing liquidity is to ensure that it will always
have sufficient liquidity to meet its liabilities when due, under both normal
and stressed conditions, without incurring unacceptable losses or risking
damage to the Company.
The Company has low liquidity risk due to maintaining adequate banking
facilities, by continuously monitoring actual cash flows and by matching the
maturity profiles of financial assets and current liabilities.
As at 31 December 2023, the cash and equivalents of the Company were
US$6,590,935. As at 31 December 2022, the cash and equivalents of the Company
were US$10,102,683
The following are the maturities of current liabilities as at 31 December
2023:
Carrying amount Within one year 2‑5 More than 5 years
years
USD USD USD USD
Salaries 16,000 16,000 - -
Directors' fees payable 12,622 12,622 - -
Bonuses payable 1,638,709 1,638,709 - -
Trade payables 10,156 10,156 - -
Other current liabilities 162 162 - -
Accruals 40,167 40,167 - -
1,717,816 1,717,816 - -
The following table analyses the fair values of financial instruments measured
at fair value by the level in the fair value hierarchy as at 31 December 2023:
Level 1 Level 2 Level 3 Total
USD USD USD USD
Financial assets
Financial assets at FVPL 26,010,444 96,422,492 80,653,740 203,086,676
26,010,444 96,422,492 80,653,740 203,086,676
17. Related party transactions
The Company's Directors receive fees and bonuses from the Company, details of
which can be found in Note 6.
18. Subsequent events
In January 2024, TMT received a total additional US$1.5 million in dividends
from Hugo, as part of the consideration for Hugo's disposal of its food
delivery and quick commerce business in Central America to Delivery Hero
completed in 2022.
TMT invested US$1,000,000 in Propertymate Inc., trading as NewHomesMate, a
marketplace for newly built homes (www.newhomesmate.com
(http://www.newhomesmate.com) ).
TMT disposed a part of its shares in NASDAQ‑traded Backblaze for a total net
consideration of US$4.2 million.
19. Control
The Company is not controlled by any one party. Details of significant
shareholders are shown in the Directors' Report.
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