Results for the Year Ended 31 December 2019 PR Newswire

AfriAg Global plc
(“AfriAg Global” or the “Company”)

Audited Final Results for the Year Ended 31 December 2019
 

Chairman’s report (incorporating the strategic report)

AfriAg Global PLC (AQSE: AFRI), presents its Annual Report for year ended 31 December 2019.

Like many public companies around the world, the COVID-19 pandemic has unfortunately slowed down the Company’s efforts with respect to completing the Apollon UK transaction (see below), however we are totally focused on working through the delays and proceeding with this very exciting transaction. We are working diligently with our advisers and regulators towards putting this deal to shareholders for their careful consideration and approval.

Investment policy change to include Medical Cannabis investments:

In September 2018, shareholder approval was obtained at a general meeting for the expansion of the Company’s investment strategy to include medicinal cannabis. The Company has now expanded its existing investment strategy to also include investments in companies, projects or products that are progressing research in and development of medicinal cannabis and its derivatives, producing or cultivating medicinal cannabis, producing or supplying products derived from or related to cannabis (including, but not limited to, hemp and cannabidiol products); and/or commercialising or marketing medicinal cannabis and its derivatives. The Company sees tremendous opportunities in the sector, especially in the field of medical research.

Medical Cannabis Investments:

The Company currently owns 4.64 million shares (representing 2.68%) of the share capital of Apollon Formularies Ltd (“Apollon UK”). The Company raised £1.41 million during the period to assist with the acquisition of this investment.

The Company is currently working with Apollon UK to satisfy all regulatory requirements for the proposed acquisition of the entire issued share capital of Apollon UK (the “Acquisition”) as announced. In due course, subject to making an offer to the shareholders of Apollon UK and obtaining the necessary approvals, the Company intends to send an explanatory circular and notice of general meeting to its shareholders seeking approval of the Acquisition. It is intended that the Company will acquire all the issued and outstanding shares from the shareholders of Apollon UK pursuant to a right of first refusal in consideration for the issue and allotment to those shareholders of new ordinary shares in the capital of the Company at a price of 10 pence per new ordinary share.

Apollon UK is entitled to 95% of the net profit of Apollon Formularies Jamaica, Limited (“Apollon Jamaica”). Subject to approval from the Cannabis Licensing Authority in Jamaica, Apollon UK has the right to acquire a 49% interest in the issued share capital of Apollon Jamaica.

Apollon Jamaica holds the following licenses: 

  1. Licence to cultivate cannabis for the sole purposes of undertaking
     research, including clinical research as approved by the Ministry of
     Health;
  2. License to process and manufacture any cannabis-based products that have
     been approved by the Ministry of Health for medical, therapeutic and
     scientific purposes (Processing Licence 170209113513) at designated
     premises of Apollon Jamaica; and
  3. License to provide therapeutic services using cannabis (Retail (Therapeutic
     Services) Licence 170209153635).

Agriculture Investments:

The market appeared to give little credit for the investments the Company had previously made in the agricultural sector. The Company therefore put it to shareholders that we should divest our agri investments and focus on the legal medical cannabis sector. Shareholder approval for the disposal of these investments was received in late November 2019, and the full disposal of the Company’s subsidiaries has been accounted for in the 31 December 2019 accounts.
 

Share consolidation:

The Company also received shareholder approval for a share consolidation (“Consolidation”) in late 2019. The effect of the Consolidation was to reduce the number of ordinary shares in issue by a factor of 100, whilst increasing the trading price of the Company’s new ordinary shares. Following completion of the Consolidation, 30,110,011 new consolidated ordinary shares of no par value each, were on issue. This was increased to 31,710,011 by 31 December 2019 with further equity fund raising.
 

Financial Results:

During the period, the Group had revenues of £2.22 m (2018: £2.24 m) and made a gross profit of £258,000 (2018: £66,000). The total comprehensive loss for the period attributable to equity holders of the parent was £2,463,000 (2018: £347 000). These results include the Group’s share of the Subsidiaries results up to date of disposal.

There was a weighted loss per share of 9.759 p (2018: loss per share of 1.7 p).

Current assets at 31 December 2019 amounted to £1,281,000 (2018: £1,056,000).

No dividends have been paid or proposed.

Outlook:

We have a very unique ability, being one of the few companies listed in London and indeed Europe, to actually undertake investments in the fast-growing legal medical cannabis sector. Although the global cannabis market has come off its highs of last year, the medical research side will become more significant as time goes by.

Having recently completed our initial investment in Apollon UK, we are actively pursuing to further increase our stake in this key investment further as discussed above. We fully appreciate that time is of the essence, and your board, its lawyers and indeed the Apollon UK team are working tirelessly to wrap up this transaction as soon as possible.

The Board would like to take this opportunity to thank our shareholders, staff and consultants for their continued support and I look forward to reporting further significant progress over the next period and beyond.
 

The directors of the Company accept responsibility for the contents of this announcement.


David Lenigas
Executive Chairman
15 July 2020

The Directors of the Company accept responsibility for the contents of this announcement.


AfriAg Global Plc:
David Lenigas (Executive Chairman)         +44 (0)20 7440 0640  
 
Peterhouse Capital Limited                       +44 (0)20 7469 0930  
Guy Miller/Allie Feuerlein  

 

Financial statements
Consolidated statement of comprehensive income for the period to 31 December 2019

__________________________________________________________________________________________


                                                       Year ended  Year ended
                                                      31 December 31 December
                                                             2019        2018

                                                 Note       £’000       £’000

Revenue                                           4         2,217       2,236

Cost of sales                                             (1,959)     (2,170)

Gross Profit                                                  258          66

Administration expenses                                     (411)       (430)

Share Based Payment Charge                                      -           -

Operating (loss)                                  5         (153)       (364)

Share of associate result                         13          (2)          97

(Loss) on disposal of subsidiaries                22        (346)           -

Loans advanced to subsidiaries written-off        22      (1,953)           -

Investment income                                 7          (22)        (51)

Finance costs                                     8           (4)           -

(Loss) before taxation                                    (2,480)       (318)

Taxation                                          9             -           -

(Loss) for the period attributable to equity              (2,480)       (318)
holders of the parent

Other comprehensive income

Transfer to income statement                                    -          22

Translation exchange (loss)                                    17        (51)

Other comprehensive income for the period net of               17        (29)
taxation

Total comprehensive income for the year                   (2,463)       (347)
attributable to equity holders of the parent

Loss per share

Basic and diluted (pence)                         10       (9.76)       (1.7)



The accompanying accounting policies and notes form part of these financial statements.



Consolidated statement of financial position at 31 December 2019

______________________________________________________________________


                                 31 December 31 December

                                        2019        2018

                            Note       £’000       £’000

Non-current assets

Property, plant & equipment  11            -           5

Investments in associates    13            -       1,687

                                           -       1,692

Current assets

Inventory                    15            -           -

Trade and other receivables  16           16         925

Available for sale assets    14        1,167          30

Cash and cash equivalents                 98         101

                                       1,281       1,056

Total assets                           1,281       2,748

Current liabilities

Trade and other payables     17        (525)       (844)

                                       (525)       (844)

Net current assets                       756         213

Net assets                               756       1,904

Equity

Share capital                18        3,171       1,761

Share premium account                  8,535       8,630

Share based payment reserve              128         279

Revaluation reserves                       -           -

Foreign currency reserve                   -        (17)

Retained earnings                   (11,078)     (8,749)

                                         756       1,904



The financial statements of AfriAg Global plc (registered number 002845V) were approved by the Board of Directors and authorised for issue on 15 July 2020 and were signed on its behalf by:



David Lenigas       Donald Strang
Chairman             Director

The accompanying accounting policies and notes form part of these financial statements.



Company statement of financial position at 31 December 2019

_______________________________________________________________


                                            31 December 31 December

                                                   2019        2018

                                       Note       £’000       £’000

Non-current assets

Investments in subsidiary undertakings  12            -           -

Trade and other receivables             16            -       1,836

                                                      -       1,836

Current assets

Trade and other receivables             16           16         134

Available for sale assets               14        1,167          30

Cash and cash equivalents                            98          81

                                                  1,281         245

Total assets                                      1,281       2,081

Current liabilities

Trade and other payables                17        (525)       (458)

                                                  (525)       (458)

Net current assets/(liabilities)                    756       (213)

Net assets                                          756       1,623

Equity

Share capital                           18        3,171       1,761

Share premium account                             8,535       8,630

Share based payment reserve                         128         279

Revaluation reserves                                  -           -

Retained earnings                              (11,078)     (9,047)

                                                    756       1,623



The financial statements of AfriAg Global plc (registered number 002845V) were approved by the Board of Directors and authorised for issue on 14 July 2020 and were signed on its behalf by:



David Lenigas            Donald Strang
Chairman                   Director
   

The accompanying accounting policies and notes form part of these financial statements.



Consolidated statement of changes in equity for the period to 31 December 2019

____________________________________________________________________________________


               Share   Share  Share based Foreign  Revaluation Retained  Total
              capital premium   payment   currency  reserves   earnings
                                reserve   reserve

                £’000   £’000       £’000    £’000       £’000    £’000   £’000

At 31           1,461   8,648         279       34        (22)  (8,431)   1,969
December 2017

(Loss) for          -       -           -        -           -    (318)   (318)
the period

Currency            -       -           -     (51)           -        -    (51)
translation
gain

Transfer to         -       -           -        -          22        -      22
income
statement

Total               -       -           -     (51)          22    (318)   (347)
Comprehensive
Income

Shares issued     300       -           -        -           -        -     300

Share Issue         -    (18)           -        -           -        -    (18)
cost

Share based         -       -           -        -           -        -       -
payment
charge

Total             300    (18)           -        -           -        -     282
contributions
by and
distributions
to owners of
the Company

At 31           1,761   8,630         279     (17)           -  (8,749)   1,904
December 2018

(Loss) for          -       -           -        -           -  (2,480) (2,480)
the period

Currency            -       -           -       17           -        -      17
translation
gain

Transfer to         -       -           -        -           -        -       -
income
statement

Total               -       -           -       17           -  (2,480) (2,463)
Comprehensive
Income

Shares issued   1,410       -           -        -           -        -   1,410

Share Issue         -    (95)           -        -           -        -    (95)
cost

Transfer with       -       -       (151)        -           -      151       -
equity

Total           1,410    (95)       (151)        -           -      151   1,315
contributions
by and
distributions
to owners of
the Company

At 31           3,171   8,535         128        -           - (11,078)     756
December 2019



The accompanying accounting policies and notes form part of these financial statements.



Company statement of changes in equity for the period to 31 December 2019

______________________________________________________________________________________


                     Share   Share  Share based Revaluation Retained  Total
                    capital premium   payment    reserves   earnings
                                      reserve

                      £’000   £’000       £’000       £’000    £’000   £’000

At 31 December 2017   1,461   8,648         279        (22)  (8,783)   1,583

(Loss) for the            -       -           -           -    (264)   (264)
period

Transfer to income        -       -           -          22        -      22
statement

Total Comprehensive       -       -           -          22    (264)   (242)
Income

Shares issued           300       -           -           -        -     300

Share issue costs         -    (18)           -           -        -    (18)

Total contributions     300    (18)           -           -        -     282
by and
distributions to
owners of the
Company

At 31 December 2018   1,761   8,630         279           -  (9,047)   1,623

(Loss) for the            -       -           -           -  (2,182) (2,182)
period

Total Comprehensive       -       -           -           -  (2,182) (2,182)
Income

Shares issued         1,410       -           -           -        -   1,410

Share issue costs         -    (95)           -           -        -    (95)

Transfer with             -       -       (151)           -      151       -
equity

Total contributions   1,410    (95)       (151)           -      151   1,315
by and
distributions to
owners of the
Company

At 31 December 2019   3,171   8,535         128           - (11,078)     756



The accompanying accounting policies and notes form part of these financial statements.



Consolidated statement of cash flows for the period ended 31 December 2019

__________________________________________________________________________________________


                                                          Year ended  Year ended

                                                         31 Dec 2019 31 Dec 2018

                                                               £’000       £’000

Cash flows from operating activities

Operating (loss)                                               (153)       (364)

(Increase)/decrease in inventory                                (12)           3

Decrease in trade and other receivables                           81          38

(Decrease) in trade and other payables                          (71)        (75)

Depreciation                                                       1           3

Share option charge                                                -           -

Net cash (outflow) in operating activities                     (154)       (395)

Investing activities

Investment income                                                  1           3

Finance costs                                                    (4)           -

Loan advanced to related party company                             -       (117)

Receipts on sale of AFS investments                                -           1

Payments on purchase of AFS investments                      (1,160)        (62)

Cash disposed with subsidiaries                                 (13)           -

Payments for PPE assets                                            -         (3)

Net cash (outflow) in investing activities                   (1,176)       (178)

Financing activities

Issue of share capital                                         1,410         300

Issue costs                                                     (95)        (18)

Net cash inflow from financing activities                      1,315         282

Net (decrease) in cash and cash equivalents                     (15)       (291)

Cash and cash equivalents at beginning of period                 101         443

Effect of foreign exchange on cash and cash equivalents           12        (51)

Cash and cash equivalents at end of period                        98         101



The accompanying accounting policies and notes form part of these financial statements.



Company statement of cash flows for the period ended 31 December 2019

_____________________________________________________________________________________


                                                       Year ended  Year ended

                                                      31 Dec 2019 31 Dec 2018

                                                            £’000       £’000

Cash flows from operating activities

Operating (loss)                                            (206)       (210)

Decrease/(increase) in trade and other receivables              1         (9)

Increase in trade and other payables                           67          73

Share option charge                                             -           -

Net cash (outflow) in operating activities                  (138)       (146)

Investing activities

Investment income                                               -           -

Loan advanced to related party company                          -       (117)

Receipts on sale of AFS investments                             -           1

Payments on purchase of AFS investments                   (1,160)        (62)

Net cash (outflow) in investing activities                (1,160)       (178)

Financing activities

Issue of share capital                                      1,410         300

Issue costs                                                  (95)        (18)

Net cash inflow from financing activities                   1,315         282

Net increase/(decrease) in cash and cash equivalents           17        (42)

Cash and cash equivalents at beginning of period               81         123

Cash and cash equivalents at end of period                     98          81



The accompanying accounting policies and notes form part of these financial statements.



Notes to the financial statements

____________________________________________________________________________


1 General information

  AfriAg Global plc is a company incorporated in the Isle of Man under the Isle
  of Man Companies Act 2006. The address of its registered office is 34 North
  Quay, Douglas, Isle of Man, IM1 4LB. The Company's ordinary shares are traded
  on the AQSE Exchange Growth Market as operated by Aquis Stock Exchange Ltd
  (“AQSE”).

  The financial statements of Afriag Global plc for the year ended 31 December
  2019 were authorised for issue by the Board on 15 July 2020 and the statements
  of financial position signed on the Board's behalf by Mr. David Lenigas and Mr
  Donald Strang.

  Investing policy

  The Company’s investment strategy focuses on acquisitions of direct and/or
  indirect interests in the agricultural and medicinal cannabis sectors.

  Agriculture
  The Board intend to seek acquisitions of direct and/or indirect interests in
  businesses involved in agriculture generally and the production, processing,
  logistics and distribution of agricultural produce. The Company will focus on
  opportunities in this sector in Europe, Africa and the Middle East, but will
  consider possible opportunities anywhere in the world.

  Medicinal Cannabis
  The Board intend to seek investments in companies, projects or products that
  are:
  · progressing medicinal cannabis research and development;
  · producing or cultivating medicinal cannabis;
  · producing or supplying products derived from or related to cannabis
  (including, but not limited to, hemp and cannabidiol products); and/or
  · commercialising or marketing medicinal cannabis and its derivatives.

  The Company will seek investments in companies and projects in jurisdictions
  which have well-developed and reputable laws and regulations for the research
  and production of medicinal cannabis and in jurisdictions that are signatories
  to the United Nation’s conventions on narcotics.

  Types of Investments
  The Company is likely to be an active investor within these sectors and
  acquire control of certain target companies although it may also consider
  acquiring non-controlling shareholdings. The proposed investments to be made
  by the Company may be in either quoted or unquoted securities and made by
  direct acquisition of an interest in companies, partnerships or joint
  ventures, or direct interests in projects and can be at any stage of
  development. Accordingly, the Company’s equity interest in a proposed
  investment may range from a minority position to 100 per cent. ownership and a
  controlling interest. The Directors’ primary objective is to achieve the best
  possible value over time for Shareholders, primarily through capital growth.

  If the Company takes a controlling stake, the acquisition could trigger a
  Reverse Takeover under Rule 58 of the AQSE Exchange Rules.

  The Board intend to acquire one or more investments in quoted or unquoted
  businesses or companies (in whole or in part) thereby creating a platform for
  further investments. There is no limit on the number of companies, projects or
  products that the Company may invest in with the agricultural and medicinal
  cannabis sectors. The Company may need to raise additional funds for these
  purposes and may use both debt and/or equity.



Notes to the financial statements (continued)

__________________________________________________________________________________________


 Investing policy (continued)

 The Board believes that their collective experience, together with their
 extensive network of contacts and the Company’s Technical Committee, will
 assist them in the identification, evaluation and funding of appropriate
 investment opportunities within the medicinal cannabis sector. When necessary,
 other external professionals will be engaged to assist in the due diligence on
 prospective targets and their management teams. The Directors will also
 consider appointing additional directors and/or advisors with relevant
 experience if the need arises.

 It is anticipated that there may be opportunities to spin out businesses
 privately or by initial public offerings where Shareholders may be able to be
 benefit through distributions of cash and/or shares and/or rights to subscribe
 in listings. Given the nature of the investment strategy, the Company does not
 intend to make additional regular and periodic disclosures or calculations of
 net asset value outside of the requirements for a NEX Exchange Growth Market
 traded company. It is anticipated that the Company will hold investments for
 the medium to long term, although where opportunities exist for shorter term
 investments, the Company may undertake advantage of such opportunities.

 The Directors intend to review the investment strategy on an annual basis and,
 subject to their review and in the absence of unforeseen circumstances, the
 Directors intend to adhere to the investment strategy. Changes to the
 investment strategy may be prompted, inter alia, by changes in government
 policies or economic conditions which alter or introduce additional investment
 opportunities. It is the intention of the Directors to invest the Company’s
 cash resources, as far as practicable, in accordance with the investment
 strategy. However, due to market and other investment considerations, it may
 take some time before the cash resources of the Company are fully invested.

 It is intended that the funds currently available to the Company will be used
 to meet general working capital requirements, to undertake due diligence on
 potential target acquisitions and to make investments in accordance with the
 investment guidelines described above.

 Statement of compliance with IFRS

 The financial statements have been prepared in accordance with International
 Financial Reporting Standards (IFRS) as adopted by the European Union and as
 applied in accordance with the provisions of the Companies Act 2006. The
 principal accounting policies adopted by the Company are set out below.

 New standards, amendments and interpretations adopted by the Company
 No new and/or revised Standards and Interpretations have been required to be
 adopted, and/or are applicable in the current year by/to the Company, as
 standards, amendments and interpretations which are effective for the financial
 year beginning on 1 January 2019 are not material to the Company.

 New standards, amendments and interpretations not yet adopted
 At the date of authorisation of these financial statements, the following
 Standards and Interpretations which have not been applied in these financial
 statements, were in issue but not yet effective for the year presented:

 - IFRS 17 in respect of Insurance Contracts will be effective for accounting
 periods beginning on or after 1 January 2021

 There are no other IFRSs or IFRIC interpretations that are not yet effective
 that would be expected to have a material impact on the Company.



Notes to the financial statements (continued)

__________________________________________________________________________________________


 Going Concern

 The Directors noted the losses that the Group has made for the Year Ended 31
 December 2019. The Directors have prepared cash flow forecasts for the period
 ending 31 July 2021 which take account of the current cost and operational
 structure of the Company.

 The cost structure of the Company comprises a high proportion of discretionary
 spend and therefore in the event that cash flows become constrained, costs can
 be quickly reduced to enable the Company to operate within its available
 funding.

 These forecasts demonstrate that the Company has sufficient cash funds
 available to allow it to continue in business for a period of at least twelve
 months from the date of approval of these financial statements. Accordingly,
 the financial statements have been prepared on a going concern basis.

 It is the prime responsibility of the Board to ensure the Company remains as
 going concerns. At 31 December 2019, the Company had cash and cash equivalents
 of £98,000 and borrowings of £nil. The Company has minimal contractual
 expenditure commitments and the Board considers the present funds sufficient
 to maintain the working capital of the Company for a period of at least 12
 months from the date of signing the Annual Report and Financial Statements.
 For these reasons the Directors adopt the going concern basis in the
 preparation of the Financial Statements.

 Basis of preparation

 The consolidated financial statements have been prepared on the historical cost
 basis, except for the measurement to fair value of assets and financial
 instruments as described in the accounting policies below, and on a going
 concern basis.

 The financial report is presented in Pound Sterling (£) and all values are
 rounded to the nearest thousand pounds (£‘000) unless otherwise stated.



Notes to the financial statements (continued)

_________________________________________________________________________________________


2 Significant accounting policies

  Basis of Consolidation

  The Group financial statements consolidate those of the Company and all of
  its subsidiary undertakings drawn up to the balance sheet date. Subsidiaries
  are entities over which the Company has the power to control, directly or
  indirectly, the financial and operating policies so as to obtain benefits
  from their activities. The Company obtains and exercises control through
  voting rights. Subsidiaries are fully consolidated from the date at which
  control is transferred to the Company. They are deconsolidated from the date
  that control ceases.

  Unrealised gains on transactions between the Company and its subsidiaries are
  eliminated. Unrealised losses are also eliminated unless the transaction
  provides evidence of an impairment of the asset transferred. Amounts reported
  in the financial statements of subsidiaries have been adjusted where
  necessary to ensure consistency with the accounting policies adopted by the
  Group.

  Acquisitions of subsidiaries are dealt with by the acquisition method. The
  acquisition method involves the recognition at fair value of all identifiable
  assets and liabilities, including contingent liabilities of the subsidiary,
  at the acquisition date, regardless of whether or not they were recorded in
  the financial statements of the subsidiary prior to acquisition. On initial
  recognition, the assets and liabilities of the subsidiary are included in the
  consolidated balance sheet at their fair values, which are also used as the
  bases for subsequent measurement in accordance with the Group accounting
  policies. Goodwill is stated after separating out identifiable intangible
  assets. Goodwill represents the excess of acquisition cost over the fair
  value of the Group's share of the identifiable net assets of the acquired
  subsidiary at the date of acquisition. Acquisition costs are written off as
  incurred.

  Investments in associates are initially recognised at cost and subsequently
  accounted for using the equity method. Any goodwill or fair value adjustment
  attributable to the Group’s share in the associate is not recognised
  separately and is included in the amount recognised as investment in
  associate. The carrying amount of the investment in associates is increased
  or decreased to recognise the Group’s share of the profit or loss and other
  comprehensive income of the associate, adjusted where necessary to ensure
  consistency with the accounting policies of the Group. Unrealised gains and
  losses on transactions between the Group and its associates are eliminated to
  the extent of the Group’s interest in those entities. Where unrealised losses
  are eliminated, the underlying asset is also tested for impairment

  Revenue recognition

  Revenue is measured at the fair value of the consideration received or
  receivable and represents amounts from the sales of goods provided in the
  normal course of business, net of value added tax and discounts, and is
  recognised when the significant risks and rewards of ownership of the product
  have been transferred to a third party. In the case of sale or return
  transactions, revenue is only recognised when, and only to the level that,
  risks and rewards are transferred.

  Revenue is the invoiced value of goods and services supplied and excludes VAT
  and other sales-based taxes.



Notes to the financial statements (continued)

__________________________________________________________________________________________


2 Significant accounting policies (continued)

  Finance costs / investment revenue

  Borrowing costs are recognised as an expense when incurred.

  Investment revenue is recognised as the Group becomes entitled to such
  revenue. Dividends are accounted for on receipt thereof.

  Property, plant and equipment - General

  Plant and equipment is stated at cost less accumulated depreciation and any
  accumulated impairment losses.
  Depreciation is provided on all tangible assets to write off the cost less
  estimated residual value of each asset over its expected useful economic life
  on a straight-line basis at the following annual rates:
  · Plant and Equipment – between 5 per cent and 25 per cent
  All assets are subject to annual impairment reviews.

  Inventories

  Inventories are stated at the lower of cost and net realisable value.

  Financial instruments

  Financial assets and financial liabilities are recognised on the Group and
  Company’s statement of financial position when the Group or Company becomes a
  party to the contractual provisions of the instrument.

  The Company’s activities give rise to some exposure to the financial risks of
  changes in interest rates and foreign currency exchange rates. The Company has
  no borrowings and is principally funded by equity, maintaining all its funds
  in bank accounts.

  Financial assets

  Financial assets are classified into the following specified categories;
  financial assets “at fair value through profit or loss” (FVTPL), “held to
  maturity” investments, “available for sale” (AFS) financial assets and “loans
  and receivables”. The classification depends on the nature and purpose of the
  financial assets and is determined at the time of initial recognition.

  Available for sale financial assets

  Available-for-sale financial assets are non-derivative financial assets that
  are either designated to this category or do not qualify for inclusion in any
  of the other categories of financial assets. The Group’s available-for-sale
  financial assets include listed securities. These available-for-sale financial
  assets are measured at fair value. Realised and unrealised Gains and losses
  are recognised in the income statement. Interest calculated using the
  effective interest method and dividends are recognised in the income statement
  within investment income.



Notes to the financial statements (continued)

__________________________________________________________________________________________


2 Significant accounting policies (continued)

  Equity

  Share capital is determined using the nominal value of shares that have been
  issued.

  The share premium account represents premiums received on the initial issuing
  of the share capital. Any transaction costs associated with the issuing of
  shares are deducted from share premium, net of any related income tax
  benefits.

  The share-based payment reserve represents the cumulative amount which has
  been expensed in the income statement in connection with share based payments,
  less any amounts transferred to retained earnings on the exercise of share
  options.

  Foreign currency reserve represents the exchange translation gains/(losses) on
  converting overseas subsidiaries.

  Retained earnings include all current and prior period results as disclosed in
  the income statement.

  Cash and cash equivalents

  Cash and cash equivalents includes cash in hand, deposits held at call with
  banks, and bank overdrafts. Bank overdrafts are shown within current
  liabilities on the balance sheet.

  Financial liabilities

  Financial liabilities are obligations to pay cash or other financial assets
  and are recognised when the Group becomes a party to the contractual
  provisions of the instrument.

  All financial liabilities initially recognised at fair value less transaction
  costs and thereafter carried at amortised cost using the effective interest
  method, with interest-related charges recognised as an expense in finance cost
  in the income statement. A financial liability is derecognised only when the
  obligation is extinguished, that is, when the obligation is discharged or
  cancelled or expires.

  Trade payables

  Trade payables are non-interest-bearing and are initially measured at fair
  value and thereafter at amortised cost using the effective interest rate.

  Taxation

  The tax expense represents the sum of the tax currently payable and deferred
  tax.

  The tax currently payable is based on taxable profit for the period. Taxable
  profit differs from the net profit as reported in the income statement because
  it excludes items of income or expense that are taxable or deductible in other
  periods and it further excludes items that are never taxable or deductible.
  The Group’s liability for current tax is calculated using tax rates that have
  been enacted or substantively enacted by the balance sheet date.



Notes to the financial statements (continued)

__________________________________________________________________________________________


2 Significant accounting policies (continued)

  Provisions

  Provisions are recognised when the Group has a present obligation as a result
  of a past event, it is probable that the Group will be required to settle that
  obligation and a reliable estimate can be made of the amount of the
  obligation. The amount recognised as a provision is the best estimate of the
  consideration required to settle the present obligation at the balance sheet
  date, taking into account the risks and uncertainties surrounding the
  obligation

  Share based payments

  The Company issues equity-settled share-based benefits to employees. All
  equity-settled share-based payments are ultimately recognised as an expense in
  profit or loss with a corresponding credit to reserves.

  Share-based payments relating to the subsidiary company increase the carrying
  value of the investment in the subsidiary and are included in the loss on
  disposal of the subsidiary.

  If vesting periods or other non-market vesting conditions apply, the expense
  is allocated over the vesting period, based on the best available estimate of
  the number of share options expected to vest. Estimates are subsequently
  revised if there is any indication that the number of share options expected
  to vest differs from previous estimates. Any cumulative adjustment prior to
  vesting is recognised in the current period. No adjustment is made to any
  expense recognised in prior periods if share options ultimately exercised are
  different to that estimated on vesting.

  Upon exercise of any share options the proceeds received net of attributable
  transaction costs are credited to share capital, and where appropriate share
  premium.

3 Critical accounting judgements and key sources of estimation uncertainty

  In the process of applying the Group’s accounting policies, as described in
  note 2, management has made the following judgements that have the most
  significant effect on the amounts recognised in the financial statements.

  Valuation of share-based payments to employees

  The Company estimates the expected value of share-based payments to employees
  and this is charged through the income statement over the vesting period. The
  fair value is estimated using the Black Scholes valuation model which requires
  a number of assumptions to be made such as level of share vesting, time of
  exercise, expected length of service and employee turnover and share price
  volatility. This method of estimating the value of share-based payments is
  intended to ensure that the actual value transferred to employees is provided
  for by the time such payments are made.



Notes to the financial statements (continued)

__________________________________________________________________________________________


4 Segmental information

  An operating segment is a distinguishable component of the Group that
  engages in business activities from which it may earn revenues and incur
  expenses, whose operating results are regularly reviewed by the Group’s
  chief operating decision maker to make decisions about the allocation of
  resources and assessment of performance and about which discrete financial
  information is available.

  The chief operating decision maker has defined that the Group’s only
  reportable operating segments during the period are the agriculture and
  logistics sector, and the parent company/investment.

  Subject to further acquisitions the Company expects to further review its
  segmental information during the forthcoming financial year.

  The Group has generated revenues from external customers during the period
  of £2,217,000 (2018: £2,236,000), and £nil (2018: £nil) revenue is from
  management fees to the associate company.

  In respect of the total assets of £1,281,000 (2018: £2,748,000), £1,218,000
  (2018: £128,000) arise in the parent company, and £nil (2018: £2,620,000)
  arise in South Africa as a result of the disposal of the South African
  subsidiaries.

5 Operating loss
                                           Year to 31               Year to 31

                                             Dec 2019                 Dec 2018

                                                £’000                    £’000

  Operating loss is stated after charging:

  Wages and salaries                               76                       27

  Depreciation                                      1                        3

  Currency losses                                  13                        1

  Audit fees                                       11                       12

  Included in share options is £nil (2018 - £nil) relating to directors.

  In addition to auditors’ remuneration shown above, the auditors received the
  following fees for non-audit services.

                                            2019                          2018

                                           £’000                         £’000

  Other financial advisory services            -                             -



Notes to the financial statements (continued)

__________________________________________________________________________________________


6 Directors’ emoluments                          2019                2018

                                                £’000               £’000

  Fees and benefits                               112                 114

  The Parent Company has no other directly employed personnel.

             Fees and                    Share based

             salaries                       payments                Total

  2019          £’000                          £’000                £’000

  D Lenigas        36                              -                   36

  A Samaha *        4                              -                    4

  D Strang         36                              -                   36

  H Harris         36                              -                   36

                  112                              -                  112

  2018          £’000                          £’000                £’000

  D Lenigas        36                              -                   36

  A Samaha          6                              -                    6

  D Strang         36                              -                   36

  H Harris         36                              -                   36

                  114                              -                  114

  (*) - A Samaha resigned as a director on 9 August 2019.

  The Directors’ fees totalling £494,000 that have been accrued and
  remain unpaid as at 31 December 2019 all relate to the current and
  previous years unpaid fees. (2018: £428,000).

7 Investment income                                 Year to 31 Year to 31

                                                      Dec 2019   Dec 2018

                                                         £’000      £’000

  Interest received                                          1          3

  (Loss) on sale of AFS investments                          -       (22)

  (Loss) on market value revaluation at 31 December       (23)       (32)

  Total investment income                                 (22)       (51)



Notes to the financial statements (continued)

__________________________________________________________________________________________


8  Finance costs                                          Year to 31 Year to 31

                                                            Dec 2019   Dec 2018

   Interest paid                                                   4          -

9  Taxation                                               Year to 31 Year to 31

                                                            Dec 2019   Dec 2018

                                                               £’000      £’000

   Total current tax                                               -          -

   The actual tax charges for the period differs from the standard rate
   applicable in the UK of 19% (2018 – 19%) for the reasons set out in the
   following reconciliation:

                                                                2019       2018

                                                               £’000      £’000

   Loss on ordinary activities before tax                    (2,480)      (318)

   Tax thereon @ rates above                                   (471)       (60)

   Factors affecting charge for the period:

   Losses arising in territories where no tax is charged       (471)         60

   Current tax charge for the period                               -          -

10 Loss per share

                                                                2019       2018

   The calculation of loss per share is based on the loss      £’000      £’000
   after taxation divided by the weighted average number
   of shares in issue during the period:


   Net loss after taxation (£000’s)                          (2,480)      (318)

   Number of shares

   Weighted average number of ordinary shares for the
   purposes of basic loss per share (millions)                 25.41      15.93

   Basic and diluted loss per share (expressed in pence)      (9.76)      (1.7)

   The year to 31 December 2019 reflects the share consolidation of 27 November
   2019 of 100:1, with the prior year re-stated for comparison accordingly.

   As inclusion of the potential ordinary shares would result in a decrease in
   the earnings per share they are considered to be anti-dilutive, as such, a
   diluted earnings per share is not included.



Notes to the financial statements (continued)

__________________________________________________________________________________________


11 Property, plant & equipment - Group  Total PPE

                                            £’000

   Costs

   At 1 January 2018                            9

   Additions                                    3

   At 31 December 2018                         12

   At 1 January 2019                           12

   Additions                                    -

   Disposed with subsidiaries                (12)

   At 31 December 2019                          -

   Depreciation & impairment

   At 1 January 2018                            4

   Additions                                    3

   At 31 December 2018                          7

   At 1 January 2019                            7

   Additions                                    1

   Disposed with subsidiaries                 (8)

   At 31 December 2019                          -

   Net Book Values

   At 31 December 2019                          -

   At 31 December 2018                          5

   Impairment Review
   At 31 December 2019, the directors have
   carried out an impairment review and have
   considered that no impairment is required.



   


12 Investments in subsidiaries - Company

                                                       31 December 31 December

                                                              2019        2018

                                                             £’000       £’000

   Cost and net book value

   At 1 January                                                  -           -

   Additions                                                     -           -

   Disposals (See Note 22)                                       -           -

   At 31 December                                                -           -

   All of the Company’s following subsidiary undertakings held directly or
   indirectly by the Company during the year were disposed of on 30 November
   2019, or as noted below (See Note xx):

   Name                   Country of    Proportion of voting      Nature of
                          incorporation rights and ordinary share business
                                        capital held voting right

   AfriAg Limited         England       100%                      Holding
                                                                  Company

   Afriag International   England       100%                      Dissolved on
   Limited                                                        24 December
                                                                  2019

   AfriAg Limited         BVI           100%                      Dormant
                                                                  Company

   Afriag Holdings (Pty)  South Africa  100%                      Holding
   Limited                                                        Company

   Afriag Marketing (Pty) South Africa  100%                      Marketing
   Limited                                                        Company



Notes to the financial statements (continued)

__________________________________________________________________________________________


13 Investment in associate - Group                 31 December      31 December

                                                          2019             2018

                                                         £’000            £’000

   At 1 January                                          1,687            1,590

   Addition at cost                                          -                -

   Share of associate result                               (2)               97

   Disposal of associate (See Note 22)                 (1,685)                -

   Carrying value at 31 December                             -            1,687

   The Group's share of results of its associate, which is unlisted, and its
   aggregated assets and liabilities at the date of disposal of 30 November
   2019, is as follows:

   Name      Country of      Assets   Liabilities  Revenues  Profit/ % interest
             incorporation                                   (Loss)        held

                           As at 30 November 2019     9 months to 30
                                                      November 2019

   AfriAg    South Africa  £4,483,000  £4,199,000 £8,931,000  £4,000         40
   (Pty) Ltd

   AfriAg (Pty) Limited's year end is 28 February.



   


14 Available-for-sale investments – Group & Company 31 December 31 December

                                                           2019        2018

   Current Assets - Listed investments                    £’000       £’000

   At 1 January – market value                               30           1

   Disposals during the period                                -         (1)

   Purchases during the period                            1,160          62

   (Loss) on disposal of investments                          -        (22)

   Transfers to income statement                              -          22

   Movement in market value                                (23)        (32)

   At 31 December – market value                          1,167          30

   Represented by;

   Listed securities                                          7          30

   Unlisted securities                                    1,160           -

                                                          1,167          30

   Available-for-sale investments comprise investments in listed and
   unlisted securities which are traded on stock markets throughout the
   world, and are held by the Group as a mix of strategic and short term
   investments.

   Income from these investments was £nil for dividends received for the
   year to 31 December 2019. (2018: £nil)



   


15 Inventories - Group 31 December 31 December

                              2019        2018

                             £’000       £’000

   Goods & Packaging             -           -

   Total                         -           -



Notes to the financial statements (continued)

__________________________________________________________________________________________


16 Trade and other receivables               31 December   31 December
                                                    2019          2018

                                           Group Company Group Company
                                           £’000   £’000 £’000   £’000

   Current trade and other receivables

   Trade receivables                           -       -   219       3

   Other debtors                               5       5   585      10

   Loan to related party company               -       -   117     117

   Prepayments & accrued income               11      11     4       4

   Total                                      16      16   925     134


   Non-Current trade and other receivables

   Loans due from subsidiaries                 -       -     -   1,836

   Total                                       -       -     -   1,836


   Loans due from subsidiaries and related party totalling £1,953,000
   were written off on the disposal of the subsidiaries on 30 November
   2019.



   


17 Trade and other payables           31 December   31 December
                                             2019          2018

                                    Group Company Group Company
                                    £’000   £’000 £’000   £’000

   Current trade and other payables

   Trade creditors                     13      13   215       9

   Other creditors                      1       1   152       3

   Accruals                           511     511   477     446

   Total                              525     525   844     458



   


18 Share capital                                                Ordinary Nominal

                                                                  Shares   Value

   Ordinary shares of 0.1p each                                   Number   £’000

   Allotted, called up and fully paid

   At 31 December 2017                                     1,461,001,037   1,461

   On 12 July 2018 - 300 million shares issued at 0.1p per   300,000,000     300
   share

   At 31 December 2018                                     1,761,001,037   1,761

   On 16/05/2019 - 300 million shares issued at 0.01p per    300,000,000     300
   share

   On 29/05/2019 - 700 million shares issued at 0.01p per    700,000,000     700
   share

   On 21/06/2019 - 250 million shares issued at 0.01p per    250,000,000     250
   share

   On 14/11/2019 - 160 million shares issued at 0.01p per    160,000,000     160
   share

   Pre – consolidation 100:1 (see below)                   3,171,001,037   3,171

   Post – consolidation shares – Ordinary shares of 10p       31,710,011   3,171
   each

   At 31 December 2019                                        31,710,011   3,171



Notes to the financial statements (continued)

_________________________________________________________________________________________


18 Share capital (continued)

   Shares issued during the year ended 31 December 2019:
   300 million shares were issued by the Company, by way of a placing on 16 May
   2019 for cash at a price of 0.1p per share.

   700 million shares were issued by the Company, by way of a placing on 29 May
   2019 for cash at a price of 0.1p per share.

   250 million shares were issued by the Company, by way of a placing on 26 June
   2019 for cash at a price of 0.1p per share.

   160 million shares were issued by the Company, by way of a placing on 14
   November 2019 for cash at a price of 0.1p per share.

   On 27 November 2019 at a General Meeting of the Company it was approved that
   the Ordinary Shares were consolidated on the basis of 1 new Ordinary Share
   with the nominal value of £0.10 for every 100 Ordinary shares held with a
   nominal value of £0.001.

   Shares issued during the year ended 31 December 2018:
   300 million shares were issued by the Company, by way of a placing on 12 July
   2018 for cash at a price of 0.001p per share during the year to 31 December
   2018

    Warrants in issue

    As at 31 December 2019, nil warrants (2018: nil) remain outstanding. No
    warrants were issued, exercised, or lapsed during the year ended 31 December
    2019 (2018: nil).

    Share Options

    The Company has as at 31 December 2019, 1,190,000 (2018: 129,000,000 pre
    consolidation) share options issued through its share schemes. During the
    year nil options were issued (2018: nil), no options were exercised (2018:
    nil), nil options were cancelled (2018: nil) 100,000 options lapsed (2018:
    nil).



Notes to the financial statements (continued)

__________________________________________________________________________________________


19 Share based payments

   A modified Black-Scholes model has been used to determine the fair value of
   the share options on the date of grant. The fair value is expensed to the
   income statement on a straight-line basis over the vesting period, which is
   determined annually. The model assesses a number of factors in calculating
   the fair value. These include the market price on the date of grant, the
   exercise price of the share options, the expected share price volatility of
   the Company’s share price, the expected life of the options, the risk- free
   rate of interest and the expected level of dividends in future periods.
   As disclosed in note 5 the share option charge for the period was £nil (2018-
   £nil). On the lapse of the 100,000 share options, £151,000 was transferred
   from the share based payment reserve to retained earnings by way of an equity
   reserve transfer.

   The options currently in issue are detailed below:

   Exercise Grant      Expiry        31     Granted  Expired     31     Weighted
   Price    Date       Date       December                    December  average
                                    2018                        2019    exercise
                                                                         price

   Summary of options

   £0.10    07/12/2012 31/12/2020   690,000       -         -   690,000    £0.10

   £0.25    01/07/2016 31/12/2020   500,000       -         -   500,000    £0.25

   £0.30    12/08/2016 31/12/2019   100,000       - (100,000)         -    £0.30

                                  1,290,000       -         - 1,190,000    £0.21

   The above table represents the post ordinary share consolidation options, on
   the basis of 100:1.



   


20 Financial instruments

   The Group’s financial instruments comprise
   cash at bank and payables which arise in
   the normal course of business. It is, and
   has been throughout the period under
   review, the Group’s policy that no
   speculative trading in financial
   instruments shall be undertaken. The Group
   has been solely equity funded during the
   period. As a result, the main risk arising
   from the Group’s financial instruments is
   currency risk.

   Details of the significant accounting
   policies and methods adopted, including the
   criteria for recognition, the basis of
   measurement and the basis on which income
   and expenses are recognised, in respect of
   each class of financial asset, financial
   liability and equity instrument are
   disclosed in note 2 of the accounts.

                                    2019  2018

                                   £’000 £’000

   Financial assets (current)

   Trade receivables                   -   219

   Cash and cash equivalents          98   101

   Financial liabilities (current)

   Trade payables                     13   215



Notes to the financial statements (continued)

__________________________________________________________________________________________


20 Financial instruments (continued)

   Interest rate risk and liquidity risk
   The Group is funded by equity, maintaining all its funds in bank accounts.
   The Group’s policy throughout the period has been to minimise the risk of
   placing available funds on short term deposit. The short-term deposits are
   placed with banks for periods up to 1 month according to funding
   requirements.

   The Group had no undrawn committed borrowing facilities at any time during
   the period.

   Currency risk
   The group was directly exposed to currency risk of its subsidiaries, as they
   were based in South Africa, and exposed to movement against the South
   African Rand as their assets, liabilities, revenue and expenditure are
   denominated therein (This exposure is now immaterial since the disposal of
   the subsidiaries during the year). The parent company is denominated in
   pound sterling.

   Market risk
   The group and company’s current exposure to market risk in relation to its
   AFS investments, which are listed on stock markets throughout the world.

   Fair values
   Cash and cash equivalents (which are presented as a single class of assets
   on the face of the balance sheet) comprise cash held by the company with an
   original maturity of three months or less. The carrying amount of these
   assets approximates their fair value.

   The directors consider there to be no material difference between the book
   value of financial instruments and their values at the balance sheet date.

21 Related party transactions

   Transactions between the Company and its subsidiaries, which are related
   parties, have been eliminated on consolidation and are not disclosed in this
   note. Transactions between other related parties are discussed below.

   During the prior year to 31 December 2018, the parent company granted an
   interest free, repayable on demand loan of £117,000 to Afriag Global (Pty)
   Ltd, a South African company related to the parent by virtue of common
   Directors’ (with the group’s subsidiaries) in South Africa. No loans were
   advanced to subsidiaries or related parties during the year ended 31 December
   2019.

   All loans to subsidiaries and related parties as detailed above were
   written-off on the disposal of the Group’s subsidiaries on 30 November 2019,
   totalling £1,953,000.

   Remuneration of Key Management Personnel

   The remuneration of the Directors and other key management personnel of the
   Group are set out below in aggregate for each of the categories specified in
   IAS24 Related party Disclosures.

                                 2019                                       2018

                                £’000                                      £’000

   Short-term employee benefits   112                                        114

   Share-based payments             -                                          -

                                  112                                        114



Directors’ fees totalling £494,000 that have been accrued and remain unpaid as at 31 December 2019 all relate to the current and previous years unpaid fees. (2018: £428,000).

Notes to the financial statements (continued)

__________________________________________________________________________________________


22 Business Combination – Disposal of Subsidiaries

   On 30 November 2019, the Company completed the disposal of all of its
   subsidiaries as disclosed in Note 12, including its holding in the
   associate company as detailed in Note 13, for a nominal £1 consideration.
   The results of the subsidiaries and associate are reported in the current
   period in the consolidated statement of comprehensive income. Financial
   information relating to the disposal is set out below.

                                                                       2019

   Consideration received or receivable;                              £’000

   Cash                                                                   -

   Total disposal consideration                                           -

   Carrying amount of net assets sold                                   360

   (Loss) on sale before income tax and reclassification of foreign   (360)
   currency translation reserve

   Reclassification of foreign currency translation reserve & current    14
   year FX translation

   Income tax expense on gain                                             -

   (Loss) on sale after income tax                                    (346)

   On disposal the Company wrote off loans which had been previously
   advanced to the subsidiaries during the period of ownership. The total
   amount of £1,953,000 has been written off through the Consolidated
   statement of comprehensive income during the year.

23 Capital Commitments & Contingent Liabilities


   There are no non-cancellable capital commitments as at the balance sheet
   date. The Group has no contingent liabilities at the balance sheet date.

24 Ultimate control


   The Company has no individual controlling party.

25 Events after the end of reporting period


   There are no events after the end of the reporting period to disclose.

26 Profit and loss account of the parent company


   As permitted by s408 of the Companies Act 2006, the profit and loss
   account of the parent company has not been separately presented in these
   accounts. The parent company loss for the year was £2,182,000 (2018:
   £264,000).