COINSILIUM GROUP LIMITED - Unaudited Interim Results PR Newswire

23 September 2016

COINSILIUM GROUP LIMITED

(“Coinsilium” or the “Company”)

UNAUDITED INTERIM RESULTS

Unaudited consolidated interim financial statements for the six month period ended 30 June 2016

Coinsilium Group Limited (“Coinsilium” or the “Company”), the ISDX quoted, blockchain investment and development company, is pleased to announce its unaudited interim financial statements for the six months ended 30 June 2016.

Key Highlights

Financial

    --  Revenues increased by £190,304 to £196,211 compared with revenues of
        £5,907 for the period from incorporation to 30 June 2015.

    --  Loss for the period from continuing operations was £269,756, an
        improvement of £429,566 from the loss of £699,322 in the period from
        incorporation to 30 June 2015

    --  Loss per share of 0.004 pence for the period compared with 2 pence per
        share for the period from incorporation to 30 June 2015. Net Assets
        amounted to £2,072,297.

    --  As at 30 June 2016, cash and cash equivalents was £163,562. Financial
        assets available for sale were £1,668,824.

Investment

    --  The investment strategy of Coinsilium is to acquire strategic interests
        in early stage start-ups within the blockchain technology space. During
        this 6-month period, the Company has continued to review investment
        opportunities and stakes were increased in three investee companies;
        Factom, Fuzo and SatoshiPay.

    --  The Company also acquired a seed stake in RSK Labs. RSK operates
        “Rootstock”, a smart contract platform built as a sidechain of the
        Bitcoin blockchain that adds value and functionality to the core Bitcoin
        network by enabling smart contracts. Since our investment, RSK has
        raised a further US$1m seed financing in March.

    --  Through the inaugural 3-month accelerator programme in Barcelona
        commencing in February, we acquired equity stakes in four participants:

    --  A 3.5% equity stake in Minebox IT Services which builds secure data
        storage, sharing and backup solutions using blockchain technology,
        peer-to-peer networks and decentralised storage protocols.

    --  A 10% equity stake in Helperbit which provides a peer-to-peer natural
        disaster management platform using blockchain transparency and
        efficiency to help victims of catastrophic events around the world.

    --  A 8% equity stake in Consentio Blockchain which leverages blockchain
        technology to streamline the trade finance sector and transform the way
        businesses transact and secure payments of physical goods.

    --  A 7.6% equity stake in BitcoinForMe. An award-winning Spanish start-up
        (trading as 'Bit2Me'), the company is building a vertical offering of
        complementary digital currency services from online platforms to
        physical ATMs to gift cards distributed across thousands of retail
        stores.

    --  On 11 August 2016, Exchange of the Americas (EoA) temporarily suspended
        its digital currency exchange (meXBT) whilst it conducted a review of
        its operations. Currently, EoA is in discussions to appoint a new
        operator of the exchange and also to develop its cross border transfers
        systems in Asia. During this transition period, the Directors have
        decided to adopt a prudent approach to the fair value of its investment
        in EoA and?have determined that a write-down to its investment of
        £120,490 is appropriate.

Development

    --  On 1stApril, Laurent Kssis was appointed Non-Executive Chairman as
        Cameron Parry, who guided the company to the ISDX growth market in
        December 2015, stepped down from his role as Executive Chairman to
        pursue other business interests. Ms Pier Thomas was appointed Finance
        Director on 29 June 2016.

    --  We continue to support, assist and promote our investee companies. As
        such, the introduction of a new CEO to Coins.sx, an investee company
        which operates as Magnr, is a direct example of the work we actively
        undertake behind the scenes. We believe this not only assists our
        investees in their development but also adds value to both companies.

We also showcased five of our investee companies at an investor event in April.

    --  Coinsilium launched the first CPD (Continuing Professional Development)
        accredited course in early 2016 and whilst it has attracted a high level
        of interest, the Company is seeking a suitable partner to develop the
        courses.

    --  In April, the Company held the first Blockchain Tech Lab in London aimed
        at developers. This week long course generated interest from
        participants both in Europe and beyond. The course was taught by both
        Coinsilium directors, investees and other leading blockchain developers.

    --  The Company continued to demonstrate its strong standing in the London
        Technology ecosystem by hosting an event during London Technology Week.
        The event at Canary Wharf, was oversubscribed and attracted interest
        from across the investment and technology space.

    --  Coinsilium continues to pursue opportunities to provide business
        consultancy and educational services to commercial and government
        organisations.

Post Period end highlights

    --  On 12thJuly, the first AGM of the Company was held, at which the
        shareholders approved the resolutions to receive and adopt the audited
        accounts for the financial period to 31 December 2015; granted the Board
        authority to appoint the Auditor and agree their remuneration; and
        granted authority to the Company’s Directors to issue for cash new
        shares of the Company equal to 300 per cent. of its current issued
        shares free from pre-emption, and to dis-apply pre-emption in relation
        to the issue of shares by the Company for non-cash consideration.

    --  SatoshiPay announced in July a partnership with Visa Europe’s innovation
        department Collab for the provision of paid videos and downloads such as
        PDFs, office software documents and e-books. The news has raised market
        awareness of the possibilities surrounding SatoshiPay’s technology and
        role for nanopayments.

    --  During the summer, Factom announced two collaborations that demonstrate
        the diversified applications for the technology. The first with Intrinio
        an application and financial data provider and the second with DataYes,
        China’s first open and big data information platform covering economic
        data. The Company was also pleased to announced Factom had received a
        grant from the US Department of Homeland Security for the development of
        a digital identity system.

    --  Factom expects to soon close their Series-A investment round. Interest
        in the company was reported to be high and further details will be
        announced once the round is closed.

    --  In August, RSK Labs stated that it has developed an innovative hybrid
        security model combining smart contracts capabilities with the strongest
        blockchain. The security model also incorporates a private Federation
        integrated by leading companies from the blockchain industry. The hybrid
        security model will be key to promote institutional use cases. RSK Labs
        has more than twenty international banks, insurance companies,
        government and development agencies that are planning to launch their
        services over RSK.

Statement by the Board

Since the IPO in December 2015, Coinsilium’s strategy has been to continue to pursue five key objectives:

    --  Increase investment in existing portfolio companies who demonstrate
        sustained progress

    --  Continue to develop our infrastructure and ability to support existing
        investees

    --  Evaluate new opportunities and invest in those aligned with our
        objectives

    --  Review fundraising opportunities for working capital and investment
        requirements

    --  Consider divestment opportunities as appropriate

These interim results reflect the Company’s commitment to achieving these objectives through increased and new investments, on-going support of investee companies and a restructuring of the Board.

The Company's Board and management remain focused on the efficient deployment of our existing resources and opportunities to secure additional financing for current and future blockchain projects. The overall strategy remains to deliver a return through a range of diverse investments focused on blockchain technologies.

Blockchain continues to be the focus of the financial technology arena and we are also encouraged by the interest it is now receiving from industries outside financial services. This is best reflected in both announcements made by our own investees and the prestigious events Coinsilium team members are asked to partake in as part of our role as thought-leaders and innovators.

CEO Eddy Travia was invited to attend the World Economic Forum Davos by Innovate Finance and the Mobile World Congress in Shanghai.

For our investees it was also exciting to see diversification beyond fintech. Factom, a data-focused blockchain company in which Coinsilium holds a 1.82% equity stake announced they were joining the Smart City movement and had signed an MOU for the integration of iSoftStone's smart city solution and Factom's blockchain-as-a-service technology. This will eventually see Factom’s Apollo product become available across several regions in China.

This news should not detract from the work that is being done in the financial services arena. Nanopayments company SatoshiPay, in which we hold a 14.5% equity stake, has made significant progress this year with the launch of its API and log-in free paywall. Both of which have attracted attention from parties within the online payments space.

Although early days, we are delighted to see that the progress achieved by some of our investees has led to discussions surrounding further capital raises, which may give opportunity for divestment by the Company.

Going concern

The current economic environment in Europe remains difficult and the Group has reported an operating loss for the period.

In considering the Group’s ability to continue in operation for the foreseeable future, the Directors have considered the Group’s forecast operating cash-flows for the period up to the end of 30 September 2017, and all other related matters. This involved consideration of the cash flow implication of the budget. The Directors consider that the outlook presents some opportunities as well as challenges in terms of the generation and timing of revenues and income.

The Directors have instituted considerable measures to preserve cash, and have reduced monthly expenditure. In addition, the Directors are actively engaged in discussions with several organisations to provide training and consultancy services. The Directors are also pursuing divestment and other opportunities which would increase shareholder value and provide the required capital for future investments.

The Directors have concluded that the combination of these activities are sufficient such that the Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. Thus they continue to adopt the going concern basis of accounting in preparing the consolidated interim financial statements

Brexit

Following the result of the recent EU referendum in the UK, the Board acknowledges that this may have an impact on the company’s future trading and performance. Due to the uncertainty surrounding the exit of the UK from the EU, they cannot say with any certainty as to what this impact will be. The Company will continue to monitor the situation closely and, if required, make decisions in a timely and appropriate manner.

I wish to thank all shareholders for their support for the Company so far to date and we look forward to an exciting year ahead as we continue to support early stage blockchain companies.

Laurent Kssis
Non-Executive Chairman

CONSOLIDATED STATEMENT OF TOTAL COMPREHENSIVE INCOME


                                          Note 6 months to 30 June Incorporation
                                                              2016            to
                                                         Unaudited       30 June
                                                                            2015
                                                                       Unaudited

                                                               GBP           GBP

Revenue                                                    196,211         5,907

Cost of sales                                             (36,200)             -

Gross Profit                                               160,011         5,907

Administrative expenses                                  (309,277)     (705,229)

Impairment                                 5             (120,490)             -

Other gains/(losses)                                             -             -

Profit/(Loss) before Income Tax                          (269,756)     (699,322)

Income tax expense                                               -             -

Profit/(Loss) for the Period from                        (269,756)     (699,322)
Continuing Operations Attributable to
Owners of the Parent                                       _______       _______

Other Comprehensive Income

Items that will not be reclassified to                           -             -
profit or loss

Items that may be subsequently
reclassified to profit or loss

Fair value gain/loss on other financial                     11,223             -
assets

Total Other Comprehensive Income for the                 (258,533)             -
Period, Attributable to Owners of the
Parent

Earnings per Share

Basic and diluted earnings per share       4               (0.004)       (0.020)
attributable to equity holders of the
Parent



CONSOLIDATED STATEMENT OF FINANCIAL POSITION



                              Note        As at     As at As at 31 December 2015
                                        30 June   30 June
                                           2016      2015

                                      Unaudited Unaudited                Audited

                                            GBP       GBP                    GBP

Assets

Non-Current Assets

Intangible assets                             -       400                      -

Goodwill                                      - 1,418,501                      -

Tangible assets                           1,215         -                    508

Available for sale financial   5      1,668,824   663,912              1,452,035
assets

Other financial assets                  258,889   131,393                164,335

                                      1,928,928 2,214,206              1,616,878

Current Assets

Other receivables                        35,653    63,493                 59,058

Cash and cash equivalents               163,562    45,534                984,023

                                        199,215   109,027              1,043,081

Total Assets                          2,128,143 2,323,233              2,659,959

Equity Attributable to Owners
of the Parent

Called up share capital                       -         -                      -

Share premium account                 4,377,396 2,836,447              4,377,396

Share option reserve                     81,275         -                 81,275

Available for sale reserve              287,905         -                287,905

Other reserves                           11,223         -                      -

Retained earnings                   (2,685,502) (699,322)            (2,415,746)

Total Equity Attributable to          2,072,297 2,137,125              2,330,830
Owners of the Parent

Current Liabilities

Trade and other payables                 55,846   186,108                329,129

Total Equity and Liabilities          2,128,143 2,323,233              2,659,959



CONSOLIDATED STATEMENT OF CHANGES IN EQUITY


 Attributable to equity shareholders



   


                Share     Share   Share Available    Other    Retained     Total
              Capital   Premium  Option  for Sale Reserves    Earnings
                                Reserve   Reserve

                  GBP       GBP     GBP       GBP      GBP         GBP       GBP

As at               -        -*       -         -        -           -         -
incorporation

Loss for the        -         -       -         -        -   (699,322) (699,322)
period

Other comprehensive
income

Fair value          -         -       -         -        -           -         -
gain on
available for
sale
financial
assets

Total
comprehensive       -         -       -         -        -   (699,322) (699,322)
income for
the period

Transaction
with owners

Issue of            - 2,836,447       -         -        -           - 2,836,447
ordinary
shares

Issue costs         -         -       -         -        -           -         -

Share based         -         -       -         -        -           -         -
payments

Total               - 2,836,447       -         -        -   (699,322) 2,137,125
transactions
with owners

Balance as at       - 2,836,447       -         -        -   (699,322) 2,137,125
30 June 2015

Balance as at       - 4,377,396  81,275   287,905        - (2,415,746) 2,330,830
1 January
2016

Loss for the        -         -       -         -        -   (269,756) (269,756)
period

Other comprehensive
income

Fair value          -         -       -         -   11,223           -    11,223
gain on other
financial
assets

Total               -         -       -         -   11,223   (269,756) (258,533)
comprehensive
income for
the period

Transaction
with owners

Shares issued       -         -       -         -        -           -         -

Total               - 4,377,396  81,275   287,905          (2,685,502) 2,072,297
transactions                                        11,223
with owners

Balance as at       - 4,377,396  81,275   287,905   11,223 (2,685,502) 2,072,297
30 June 2016



CONSOLIDATED STATEMENT OF CASH FLOWS


                     6 months to 30 June Incorporation to 30 Incorporation to 31
                                    2016           June 2015       December 2015

                               Unaudited           Unaudited             Audited

                                     GBP                 GBP                 GBP

Cash flows from
operating
activities

Loss before                    (269,756)           (699,322)         (2,415,746)
taxation

Adjustments for:

Amortisation                           -             133,950                 600

Depreciation                         333                   -                 132

Issue of shares –                      -             160,000             140,000
Director fees

Finance income                      (64)                   -                (65)

Investments settled            (150,438)                   -                   -
in shares

Impairment of                          -                   -           1,110,722
intangible assets

Impairment of                    120,490                   -             200,737
available for sale
financial assets

Share based payment                    -                   -              81,275

Creditors balances                     -                   -              33,513
settled in shares

(Increase) in trade               23,405            (63,493)            (59,058)
and other
receivables

Increase in trade              (273,284)             186,108             329,130
and other payables

Net cash used in
operating                      (549,314)           (282,757)           (578,760)
activities

Cash flows from
investing
activities

Interest received                     64                   -                  65

Purchase of                    (186,841)           (176,162)           (435,590)
available for sale
financial assets

Purchase of other               (83,331)           (131,393)           (164,335)
financial assets

Purchase of                            -               (600)               (600)
intangible assets

Purchase of                      (1,039)                   -               (640)
property, plant &
equipment

Net cash used in
investing                      (271,147)           (308,155)           (601,100)
activities

Cash flows from
financing
activities

Net cash proceeds                      -             636,447           2,163,883
from issue of
shares

Net cash generated
from financing                         -             636,447           2,163,883
activities


Net                            (820,461)              45,534             984,023
(decrease)/increase
in cash and cash
equivalents

Cash and cash                    984,023                   -                   -
equivalents at the
beginning of the
period

Cash and Cash
Equivalents at end               163,562              45,534             984,023
of Period



Major Non-Cash Transactions

During the 3-month accelerator programme commencing in February, the Company acquired equity stakes in four companies – Minebox IT Services, Helperbit, Consentio Blockchain and BitcoinForMe, in exchange for €180,000 of services, in total, provided by the Company.

NOTES TO THE INTERIM FINANCIAL STATEMENTS

1.   Basis of Preparation

The consolidated interim financial statements should be read in conjunction with the annual financial statements for the period ended 31 December 2015, which have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union.  As permitted, the consolidated interim financial statements have not been prepared in accordance with International Accounting Standard 34 ‘Interim Financial Reporting’.

2.   Financial Information

The consolidated interim financial statements set out above do not constitute statutory accounts. They have been prepared on a going concern basis in accordance with the recognition and measurement criteria of International Financial Reporting Standards (IFRS) as adopted by the European Union. Except as described below, the accounting policies applied in preparing the interim consolidated financial statements are consistent with those that have been adopted in the Group’s 2015 audited financial statements. Statutory financial statements for the period ended 31 December 2015 were approved by the Board of Directors on 1 June 2016.  The report of the auditors on those financial statements was unqualified.

Going concern

The current economic environment in Europe remains difficult and the Group has reported an operating loss for the period.

In considering the Group’s ability to continue in operation for the foreseeable future, the Directors have considered the Group’s forecast operating cash-flows for the period up to the end of 30 September 2017, and all other related matters. This involved consideration of the cash flow implication of the budget. The Directors consider that the outlook presents some opportunities as well as challenges in terms of the generation and timing of revenues and income.

The Directors have instituted considerable measures to preserve cash, and have reduced monthly expenditure. In addition, the Directors are actively engaged in discussions with several organisations to provide training and consultancy services. The Directors are also pursuing divestment and other opportunities which would increase shareholder value and provide the required capital for future investments.

The Directors have concluded that the combination of these activities are sufficient such that the Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. Thus they continue to adopt the going concern basis of accounting in preparing the consolidated interim financial statements.

Risks and uncertainties

The key risks that could affect the Group’s short and medium term performance, and the factors that mitigate those risks have not substantially changed from those set out in the Group’s 2015 Annual Report and Financial Statements, a copy of which is available on the Company’s website: www.coinsilium.com.  The Group’s key financial risks are liquidity, equity securities price risk and foreign exchange movements.

Accounting policies

The preparation of consolidated interim financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the end of the reporting period. Significant items subject to such estimates are set out in note 4 of the Group’s 2015 Annual Report and Financial Statements. The nature and amounts of such estimates have not changed significantly during the interim period. The consolidated interim financial statements have been prepared on the historical cost basis, except for the measurement to fair value of assets and financial instruments. Fair value is based on cost less any impairment charges. Impairment charges are made to the profit and loss account.

Changes in accounting policies and disclosures

There are no new and amended IFRS standards that are effective for the first time for the financial year commencing 1 January 2016 that would be expected to have a material impact on the Group.

The financial information for the 6 months ended 30 June 2016 and for the period from incorporation ended 30 June 2015 has not been audited.

No dividends have been paid or recommended to be paid during the period (30 June 2015: £Nil).

3.   Directors Remuneration

Directors of the Company received total remuneration of £75,833 for the 6 months ended 30 June 2016 (30 June 2015: £Nil).

4.   Loss Per Share (LPS)

Basic loss per share is calculated by dividing the loss attributable to equity shareholders by the weighted average number of ordinary shares outstanding during the period.


                     Profit    Weighted  As at 30 June 2016 As at 30 June 2015
                                average      Loss per Share     Loss per Share
                              number of
                                 Shares

                        GBP                             GBP

Basic LPS

Loss attributable (269,756)  69,468,117             (0.004)             (0.02)
to shareholders     _______  __________               _____              _____

                  (269,756)  69,468,117             (0.004)             (0.02)
                    _______  __________               _____              _____



Diluted earnings per share is calculated by adjusting the weighted average number of shares to assume the conversion of all dilutive potential shares.  The Company had no dilutive potential shares during the period. 

5.   Available For Sale Financial Assets


                Unlisted   Unlisted   Unlisted   Unlisted   Unlisted   Unlisted     Total
                  Equity     Equity     Equity     Equity     Equity     Equity
              Securities Securities Securities Securities Securities Securities
                  Europe  Hong Kong     United        BVI     Mexico     United
                                       Kingdom                           States

                     GBP        GBP        GBP        GBP        GBP        GBP       GBP

At                     -          -          -          -          -          -         -
Incorporation


Additions              -     37,614    426,150    125,221      2,894     72,033   663,912

Impairment             -          -          -          -          -          -         -

Exchange               -          -          -          -          -          -         -
differences

At 30 June                   37,614    426,150    125,221      2,894     72,033   663,912
2015


Additions              -    222,166    282,790     30,129     95,889     70,431   701,405

Impairment             -   (45,837)          -  (155,350)          -          - (201,187)

Fair value             -          -          -          -    287,905          -   287,905
movement

At 31                  -    213,943    708,940          -    386,688    142,464 1,452,035
December 2015


Additions        199,597     19,703    116,970          -          -          -   336,270

Impairment             -          -          -          -  (120,490)          - (120,490)

Fair value                        -          -          -          -          -         -
movement

Foreign
exchange             987     (6533)       5991          -          -        564     1,009
adjustment

At 30 June                  227,113    831,901          -    266,198    143,028 1,668,824
2016             200,584



At 30 June 2016, the Company owns unlisted shares in:

    --  Hive Labs Limited, a company incorporated in BVI. This investment has
        been previously fully written down. The Directors fully impaired the
        investment in Hive Labs Limited at 31 December 2015, due to the
        cessation of development of the Hive wallet due to lack of resources;
    --  Fuzo Limited, a company incorporated in Hong Kong;
    --  Exchange of the Americas, SAPI de CV, a company incorporated in Mexico
        which has been subject to an impairment charge of £120,490. The
        Directors partially impaired the investment in Exchange of the Americas,
        due to the temporary suspension of its digital currency exchange, meXBT;
    --  Fidelia Solutions Limited, a company incorporated in Hong Kong, trading
        under the name ‘CoinSimple’ and which has been previously subjected to
        an impairment charge;
    --  Cryptopay Limited, a company incorporated in the United Kingdom;
    --  Coins.sx Limited, a company incorporated in the United Kingdom, trading
        under the name of ‘Magnr’;
    --  SatoshiPay Limited, a company incorporated in the United Kingdom;
    --  TRAC Technology Limited, a company incorporated in the United Kingdom;
    --  Factom Inc., a company incorporated in the United States;
    --  Neuroware.io Inc., a company incorporated in the United States;
    --  Consentio Blockchain S.L., a company incorporated in Spain;
    --  Helperbit S.R.L., a company incorporated in Italy;
    --  BitcoinForMe S.L., a company incorporated in Spain; and
    --  Minebox IT Services GmbH, a company incorporated in Austria.

6.   Approval of Interim Financial Statements

The interim financial statements were approved by the Board of Directors on 22 September 2016.

The Directors of Coinsilium take responsibility for this announcement.

Notes to Editor

About Coinsilium Group

Coinsilium is a London-based blockchain technology focused investment and development company, supporting early-stage blockchain companies through investment, acceleration, development and education. 

Coinsilium is the world's first blockchain technology focused company to be admitted to trading on an Exchange Regulated Market and has a portfolio of interests in blockchain companies and projects.  In addition to pursuing its investment strategy Coinsilium is able to offer a suite of services including corporate/business advisory, CPD accredited training & education, investment solutions, in-house development and other professional services to blockchain/fintech companies and major corporates wanting to learn more about blockchain technology and its implications to the way the world transfers value over the internet.

For further information please visit http://www.coinsilium.com/

Or please contact the following:


Eddy Travia / Laurent Kssis Coinsilium Group Limited +44 (0) 207 099 0740

Peter Shea / Asha Chotai    Daniel Stewart & Company +44 (0) 207 776 6550
                            (Corporate Adviser)

Nick Emerson / Andy Thacker SI Capital Limited       +44 (0) 1483 413 500
                            (Broker)

Jan Skoyles                 Coinsilium Group Limited janskoyles@coinsilium.com
                            (Marketing)