TIDMTECH
RNS Number : 0823H
TechFinancials Inc.
30 July 2021
30 July 2021
TechFinancials, Inc
("TechFinancials" or the "Company" or the "Group")
Annual Report & Accounts and AGM Update
TechFinancials Inc. (AQSE: TECH), announces that its audited
Annual Report and Accounts, for the year ended 31 December 2020, is
available to view on the Company's corporate website at
https://group.techfinancials.com .
Based on the latest available advice, the Company will hold the
AGM via a zoom meeting. A notice containing the full text of the
resolutions to be proposed along with the place of the meeting will
be sent in due course.
Financial Highlights
-- A s at 31 December 2020, t he Company discontinued all its
traditional operational activities and continues to look for
investment opportunities
-- Revenues of US$1.3 million (2019: US$3.4 million) a decrease of 62%
-- Pre-tax profit attributable to shareholders of US$1.0 million (2019: loss of US$5.7 million)
-- Cash position of US$1.4 million as at 31 December 2020 (2019: US$0.7 million)
-- Basic earnings per share ('EPS') US$0.01 (201 9 : (US$0.07))
-- In January 2020, the Company's admission to trading on AIM
was cancelled and subsequently the Company remains quoted solely on
the AQSE Growth Market ("AQSE")
-- In April 2020, the Company exercised its option over Cedex
Holdings Limited ("Cedex"), Consequently the accounts of Cedex are
consolidated for the first time from this date with the Company
accounts. In November 2020 the Company purchased additional shares
of Cedex from a third party for a total consideration of US$ 17 , 5
00 . Following the above, the Company hold 99.84% of Cedex' issued
share capital (93.62% on a fully diluted basis)
-- In October 2020, the IP of Footies Ltd. ("Footies), the
wholly owned subsidiary, was transferred to the Company. Footies
has an application for voluntary strike-off, and unless cause is
shown against strike-off, Footies will be dissolved on
approximately 15 August 2021
-- In October 2020, the Company terminated all its agreements
with the Company's B2B clients. Consequently, the Company no longer
operates any B2B business
-- In October 2020 Cedex, the Company's 99% subsidiary,
terminated all its engagements with its employees and consultants.
Consequently, the Company no longer operates any Blockchain
business
-- In November 2020, the Company signed a S imple Agreement for
Future Equity ("SAFE") with RenewSenses Ltd. ("RenewSenses"), an
Israeli Company, developing assistive technologies for the visual
impaired, for a total amount of US$152k. The conversion of the loan
will entitle the Company to hold not less than 17% of RenewSenses
issued share capital
-- At the beginning of 2021, the Company acquired shares of
companies entering into transactions and listed on the LSE and
AIM
Covid-19 crisis along with the continuing regulatory challenges
led eventually to the closing all the Company's core
operations.
Operational Highlights
Blockchain Trading Technology
-- The Company decided to close the operations of Footies during
the year due to the negative business conditions that existed in
the market resulting from the Covid-19 pandemic and relating
restrictions, which put on hold sports and other events that
Footies' controlling tickets solutions target. As a result of the
lack of capital and interest by the market, in October 2020, the
Company acquired from Footies its entire IP and subsequently
notified HMRC of Footies' impending strike off.
-- The Company exercised its option over Cedex in April 2020 in
order to gain full control over Cedex. The Company continued to
support Cedex during the period in the blockchain-related projects,
while continuing to look for opportunities to materialize Cedex's
assets or join forces with other companies, in order to move
forward with its Cedex blockchain diamond exchange and related
projects. The various attempts to close a deal with potential
partners, investors or purchasers did not martialize, in some cases
due to the market conditions related to the Covid -19 pandemic in
the second half of the year. As a result, the Company decided to
close Cedex's operations and in October 2020 terminated all Cedex'
contracts with employees and other technical consultants.
Software Licensing (B2B)
-- The Company continued to support customers of its B2B
division through 1 November 2020, when all contract obligations
ended. Subsequently the Company laid of all its B2B employees and
service providers.
Simple Agreement Future Equity (SAFE)
-- In November 2020, the Company signed with RenewSenses Ltd.,
an Israeli start-up, a SAFE, following which the Company invested
in RenewSenses a total amount of US$ 152k.
The investment will be automatically converted at a 20% discount
to the next round valuation, with a valuation cap of 2M NIS (US$0.6
million). The Company will therefore hold at least 17% of
RenewSenses share capital. RenewSenses aims to revolutionize the
way people with visual impairment experience the world. The company
develops a wearable mobile device that combines cutting-edge
computer vision, vision-to-audio and vision-to-touch sensory
substitution methods. The device will enable users to detect and
locate objects, people, and general visual characteristics in their
immediate surroundings through alternative senses. The company is
in the final stages of developing its MVP and will be raising
additional funds during 2021 to support its go to market plans
Chairman's Statement
2020 continued to be a very challenging year, mainly due to the
impact of the Covid-19 pandemic, following which the Board has
taken major decisions to close all the Blockchain related
operations in Footies and Cedex.
As informed in the previous year's accounts, the Company closed
in October 2020 the entire B2B historical business, which suffered
from ongoing declining revenues and losses due to challenging
regulatory environment affecting its customers' ability to
operate.
In order to reduce costs, in January 2020 the Company's
admission on AIM was cancelled and following that the Company
remained listed solely on the AQSE Growth Market ("AQSE").
The Board decided to look for new business opportunities which
led the Company in November 2020 to engage in a SAFE with a
start-up company that it believes has the potential for creating
value for the shareholders. The Company will continue to look for
new ways to increase its value.
Dividend s
The Board will not be recommending a final dividend to the
shareholders of the Company for FY2020 (2019: $nil).
Outlook and current trading
The year was a turning point for the Group, where it had to
close its operations, release all employees and cancel its
admission to AIM while seeking new business opportunities to
increase the value of the company.
The Company will continue to look for business opportunities to
maximize the Company's value, leveraging its available cash and
investment in RenewSenses .
I would like to thank our shareholders for their continued
support in what has been a difficult year.
We look forward to updating the market on our progress in due
course.
Eitan Yanuv
Independent Non-Executive Chairman
Going concern (extracted from the Auditor Report note 3u)
The Consolidated Financial Statements have been prepared under
the going concern assumption, which presumes that the Group will be
able to meet its obligations as they fall due for at least the next
twelve months from the date of the signing of the Financial
Statements.
Directors have prepared a budget plan till the end of 2022.
Analysing the expected expenses and the current cash position, the
directors believe that the company can meet its obligations
throughout 2022.
The Financial Statements do not include any adjustments that may
be required should the Group be unable to continue as a going
concern.
The directors of the Company accept responsibility for the
contents of this announcement.
For further information:
TechFinancials, Inc. Tel: +972 54 5233
943
Asaf Lahav, Executive Board member
Peterhouse Capital Limited (AQSE Growth Tel: +44 (0) 20
Market Advisor and Broker) 7469 0930
Guy Miller and Mark Anwyl
Consolidated Statement of Comprehensive Income
For the year ended 31 December 2020
2020 2019
------------------------------------------ ------------------------
US$'000 US$'000
Revenue 1,309 3,418
Cost of sales (87) *(911)
------------------------------------------ ------------------------
Gross profit 1,222 2,507
Expenses:
Research and development ( 512 ) (2,177)
Selling and marketing ( 53 ) (648)
Administrative ( 654 ) (2,648)
Other expenses - (153)
Impairment of goodwill - (2,606)
------------------------------------------ ------------------------
Operating Income (Loss) 3 (5,725)
Bank fees (50) (31)
Foreign exchange gain (loss) 70 (58)
Other financial (expenses)
/ income (1) (10)
------------------------------------------ ------------------------
Financing Income (expenses) 19 (99)
Other Income (expenses)
Other non-operational income
(expenses) 875 (400)
Profit (Loss) before taxation 897 (6,224)
Taxation 70 (47)
------------------------------------------ ------------------------
Profit (Loss) for the year
from continuing operations** 967 (6,271)
Gain (Loss) from discontinued
operations 50 (19)
Capital gain from a sale ____________________- _______________65_
of subsidiary
Gain / (loss) for the year
from discontinued operations,
net 50 46
Other comprehensive income - -
Total comprehensive Profit
(Loss)* 1,017 (6,225)
========================================== ========================
Profit (Loss) attribute
able to:
Owners of the Company 997 (5,774)
Non-controlling interest 20 (451)
------------------------------------------ ------------------------
Profit (Loss) for the period 1,017 (6,225)
Consolidated Statement of Financial
Position
As at 31 December 2020
31 December 31 December
------------- -------------
2020 2019
------------- -------------
US$'000 US$'000
Non-current assets
Intangible assets, net - 112
Property and equipment, net - 16
Investment in related party - 200
Financial asset held at FVTPL 152 -
152 328
------------- -------------
Current assets
Trade receivables, net and other
receivables 13 606
Restricted bank deposits - 71
Cash 1,419 672
------------- -------------
1,432 1,349
------------- -------------
Total Assets 1,584 1,677
Current liabilities
Trade and other payables 88 1,173
Income tax payable - 103
Income tax provision 86 -
174 1,276
------------- -------------
Non-current liabilities
Shareholders loan 84 92
Equity
Share capital 61 61
Share premium account 12,022 12,022
Share-based payment reserve 798 934
Accumulated profits / (losses) (11,555) (12, 459)
------------- -------------
Equity attributable to owners
of the Company 1,326 558
Non-controlling interests - (249)
Total equity 1,326 309
Total Equity and Liabilities 1,584 1,677
Consolidated statements of cash flows
For the year ended 31 December 2020
Years ended 31 December
--------------------------
2020 2019
------------- -----------
US$'000 US$'000
------------- -----------
Cash Flows from operating activities
Profit (Loss) before tax for the period 946 (6,178)
Adjustment for:
Amortisation of intangible assets 75 404
Impairment of intangible assets, net 37 2,696
Gain on bargain purchases (309) -
Depreciation of property and equipment 4 61
Share option charge 6 17
Impairment of account receivables - 153
Forgiveness of loan due to NCI (51)
Capital loss on disposal of property
and equipment 12 400
Gain from revaluation of intangible assets (577) -
Income tax expenses 92 -
Operating cash flows before movements
in working capital:
Decrease in trade and other receivables 589 1,414
Decrease in long term receivables - -
Decrease in trade and other payables (1,453) (267)
Interest Income - (1)
Income tax received - 1
R&D tax credit received 163 -
Income tax paid (109) (43)
------------- -----------
Net cash used for operating activities (575) (1,343)
------------- -----------
Cash flows from investing activities
Proceeds from selling a subsidiary - 112
Proceeds from a refund of deposit - 51
Decrease in restricted bank deposits 71 205
Consideration from sale of intangible
assets 974 -
Net cash acquired on acquisition (note
A) 649 -
Loans eliminated from obtaining control
of a subsidiary (296) 79
Loans refunded to the Company - 68
Funds advanced under SAFE agreement (152) -
Acquisition of property and equipment ( 4 )
------------- -----------
Net cash generated from investing activities 1,246 511
------------- -----------
Cash flows from financing activities
Lease payments - (262)
------------- -----------
Net cash used in financing activities - (262)
------------- -----------
Cash and equivalents at beginning of
period 672 1,712
Effect of changes in exchange rates on
Cash 76 54
------------- -----------
Cash and equivalents at end of period 1,419 672
============= ===========
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July 30, 2021 06:05 ET (10:05 GMT)
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