TIDMTECH

RNS Number : 9261Q

TechFinancials Inc.

01 July 2022

TechFinancials Inc.

("TechFinancials" or the "Company" or the "Group")

Preliminary non audited Annual Report for the year ended 31 December 2021

The information set out below has been extracted from the Company's draft report and accounts for the year ended 31 December 2021 and has not been audited. A further announcement will be released by the Company on completion of the audit, expected shortly, and any material changes between the financial information set out below and the audited financial information will be disclosed in that announcement.

Financial Highlights

   --   No Revenues in 2021 as there are no operating businesses left. 

-- Pre-tax loss attributable to shareholders of US$0.368 million (2019: profit of US$1.1 million)

   --   Cash position of US$0.92 million as at 31 December 2021 (2020: US$1.4 million) 
   --   Basic earnings per share ('EPS') (US$0.43) (2020:  (US$0. 01 )) 
   --   In October 2021, the Company's sold its subsidiary Cedex Holdings Limited ("Cedex"),. 
   --   In June 2021, the Company stuck off Footies Ltd. ("Footies) 

-- In 2021, the Company acquired shares in few transactions, of listed companies in the LSE and AIM (Note 28)

Operational Highlights

Operational Cost Reduction

-- The Company decided to close all its subsidiaries and initiated the strike-off of its entities in Israel in 2021. The strike off of both TechFinaials Israel 2014 Ltd and Softbox was initiated in H2 2021 and concluded in 2022.

   --   The Company sold Cedex in October 2021. 

Investment Activities

-- The Company invested small amounts in several London placings in 2021. This activity resulted in profit of $88k .

-- As of today, the Company has only one legal entity - TechFinancials Inc, and as results the costs of operating the Company is set to the minimum possible.

Chairman's Statement

2021 was a year in which the company focused on reducing costs and consolidating its assets. We initiated the closure of all our subsidiaries and sold Cedex.

The Board decided to invest some amounts in listed companies and was able to generate good returns for these investments. 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 FY2021 (2020: $nil).

Outlook and current trading

The year was a turning point for the Group, where we initiated to closure of all our subsidiaries and consolidated all our assets, while seeking new investment opportunities to increase the value of the Company.

The Group will continue to look for business and investment opportunities to maximize the Company's value, leveraging its available cash.

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

30 July 2022

Strategic Report

Financial Results

The Company did not have any revenues in 2021 as it shut down all its operation businesses and closed all subsidiaries. The Company will continue to look for business and investment opportunities.

The loss for the period attributable to shareholders of the Company was US$ 0.368m (2020: US$ 1.00m*).

The Group's cash position for the period ended 31 December 2021 was US$0.92m (31 December 2020: US$1.42m).

Operations

In October 2021, TechFinancials sold its 99.84% holding of Cedex in order to consolidate cash and reduce operating expenses.

On October 2021 TechFinancials sold its 99.84% owned subsidiary, Cedex Holdings Limited ("Cedex"), to Lem Management Limited ("Buyer"), to consolidate cash and reduce operating expenses. According to the terms of the Agreement, the Company will be entitled to future consideration upon the Buyer succeeding to raise US$20 million in a single or series of related transactions, for the future operation of Cedex, or selling Cedex for a minimum of US$2 million. In certain circumstances of a sale of Cedex, or the assets of Cedex, by the Buyer, the Company will be entitled to receive 50% of that consideration above US$ 2 million. Between US$5 million and US$50 million, the Company will be entitled to receive US$1.6 million out of the first US$5 million and 4% out of the remainder, but no more than US$2 million. US$50 million and above, the Company will be entitled to receive 4% of the proceeds.

The Group has closed all its operating activities.

Growth Strategy and Outlook

Since the company has laid off its last few employees in 2020, the Board is focused on attempts to generate value to the shareholders by locating investment opportunities. The Company has invested in London placings. The Board will also continue to search for additional investment opportunities that may have a positive outcome on the Company's cashflow.

We hope that our new strategy will create a positive impact on the Company's business value for the shareholders.

I would like to thank our shareholders once again for their continued support during this challenging year.

Asaf Lahav

Executive Director

30 July 2022

For further information:

 
    TechFinancials, Inc.                    Tel: +972 54 5233 
                                             943 
    Asaf Lahav, Executive Board member 
 
 
    Peterhouse Capital Limited (AQSE Growth      Tel: +44 (0) 20 7469 
     Market Advisor and Broker)                   0930 
    Guy Miller and Mark Anwyl 
 

Consolidated Statement of Comprehensive Income

For the year ended 31 December 2021

 
                                                                    2021                                        2020 
                           ---------------------------------------------  ------------------------------------------ 
                                                                 US$'000                                     US$'000 
 
 Revenue                                                               -                                       1,309 
 Cost of sales                                                         -                                        (87) 
                           ---------------------------------------------  ------------------------------------------ 
 
 Gross profit                                                          -                                       1,222 
 
 Expenses: 
 Research and development                                              -                                     ( 512 ) 
 Selling and marketing                                                 -                                      ( 53 ) 
 Administrative                                                  ( 200 )                                     ( 662 ) 
 Impairment of goodwill                                              -                                            - 
                           ---------------------------------------------  ------------------------------------------ 
 
 
   Operating Income 
   (Loss)                                                          (200)                                           3 
 
 Bank fees                                                           (9)                                        (50) 
 Foreign exchange income 
  (loss)                                                            (30)                                          70 
 Other financial 
  (expenses) 
  / income                                                            86                                         (1) 
                           ---------------------------------------------  ------------------------------------------ 
 Financing income 
  (expenses                                                           47                                          19 
 
 Other Income (expenses) 
 Other non-operational 
  income (expenses)                                                (152)                                         875 
 
 Profit (Loss) before 
  taxation                                                         (305)                                         897 
 
 Taxation                                                            (4)                                          70 
                           ---------------------------------------------  ------------------------------------------ 
 
   Profit (Loss) for 
   the year from 
   continuing 
   operations**                                                    (309)                                         967 
 Gain (loss) from 
  discontinued 
  operations                                                       (181)                                          50 
  Capital loss from                             ____________________(30)     ____________________- 
   a sale of subsidiary 
 Gain / (loss) for 
  the year from 
  discontinued 
  operations, net                                                  (211)                                          50 
 
 Other comprehensive                                                 -                                             - 
  income 
 Total comprehensive 
  Profit (Loss)**                                                  (520)                                       1,017 
                           =============================================  ========================================== 
 
 Profit (Loss) attribute 
  able to: 
 Owners of the Company                                             (520)                                         997 
 Non-controlling interest                                              -                                          20 
                           ---------------------------------------------  ------------------------------------------ 
 Profit (Loss) for 
  the period                                                       (520)                                       1,017 
 
 
 
 
                                                                     2021                                    2020 
                                                             Cents USD                          Cents USD 
 
 Basic                                                             (0.61)                                    1.16 
                                   ======================================  ====================================== 
 Diluted                                                           (0.61)                                    1.16 
                                   ======================================  ====================================== 
 From continuing operations 
  - Basic                                                          (0.36)                                    1.10 
                                   ======================================  ====================================== 
 
   From continuing operations 
   - Diluted                                                       (0.36)                                    1.10 
                                   ======================================  ====================================== 
 
   From discontinued operations 
   - Basic                                                         (0.25)                                    0.06 
                                   ======================================  ====================================== 
 From discontinued operations 
  - Diluted                                                        (0.25)                                    0.06 
                                   ======================================  ====================================== 
 

Consolidated Statement of Financial Position

As at 31 December 2021

 
                                       31 December    31 December 
                                     -------------  ------------- 
                                              2021           2020 
                                     -------------  ------------- 
                                           US$'000        US$'000 
 Non-current assets 
 Long-term investments                           -            152 
 
                                                 -            152 
                                     -------------  ------------- 
 
 Current assets 
 Trade receivables, net and other 
  receivables                                    -             13 
 Short-term investments                         26              - 
 Cash                                          920          1,419 
                                     -------------  ------------- 
                                               946          1,432 
                                     -------------  ------------- 
 
 
 Total Assets                                  946          1,584 
 
 Current liabilities 
 Trade and other payables                       56             88 
 Income tax payable                              -             86 
                                     -------------  ------------- 
                                                56            174 
                                     -------------  ------------- 
 
 Non-current liabilities 
 Shareholders loan                              84             84 
 
 Equity 
 Share capital                                  61             61 
 Share premium account                      12,022         12,022 
 Share-based payment reserve                   798            798 
 Accumulated profits / (losses)           (12,075)       (11,555) 
                                     -------------  ------------- 
 Equity attributable to owners 
  of the Company                               806          1,326 
 Non-controlling interests                       -              - 
 Total equity                                  806          1,326 
 
 Total Equity and Liabilities                  946          1,584 
 
 

Consolidated statements of changes in equity

For the year ended 31 December 2021

 
                                             Share 
                                             based 
                      Share       Share    payment   Revaluation                           Non -controlling 
                    capital     Premium    reserve       reserve                               interests 
                                                                   Accumulated 
                      (Note       (Note     (Note,        (Note,      profits/                  (Notes 
                        14)         14)        15)            9)      (losses)     Total         1 8)           Total 
                 ----------  ----------  ---------  ------------  ------------  --------  -----------------  -------- 
                    US$'000     US$'000    US$'000       US$'000       US$'000   US$'000       US$'000        US$'000 
                 ----------  ----------  ---------  ------------  ------------  --------  -----------------  -------- 
 
 Balance 
  at 1 January 
  2020                                         934                    (12,459)       558              (249)       309 
                                         =========  ============  ============  ========  =================  ======== 
 
 
 Balance 
  at 1 January 
  2020                     61      12,022      934                (12,459)      588   (249)        309 
 
 
 Total comprehensive 
  income (expense) 
  for the 
  year                      -           -        -         -           997      997      20      1,017 
 
 Gain on 
  revaluation 
  of cryptocurrency 
  digital 
  assets in 
  the year                  -           -        -       577           577                         577 
 Disposal 
  of cryptocurrency 
  digital 
  assets in 
  the year                  -           -        -     (577)         (577)                       (577) 
 
   Purchase 
   of NCI in 
   Footies 
   during the 
   year                     -           -        -         -         (229)    (229)     229          - 
 
 Share based 
  payment                   -           -        6                     (6)        -       -          - 
 
   Transfer 
   of Share 
   based payment 
   reserve 
   on lapsed 
   options                  -           -    (142)                     142        -       -          - 
 
 Balance 
  at 31 December 
  2020                     61      12,022      798         -      (11,555)    1,326       -      1,326 
                       ======  ==========  =======  ========  ============  =======  ======  ========= 
 
 
 
 
 
 
   Total comprehensive 
   loss for 
   the year                -    -    -      -   (520)   (520)   -   (520) 
 
 
 
 
 
 
 
   Balance 
   at 31 
   December 
   2021           61      12,022      798      -      (12,075)    806     -      806 
              ======  ==========  =======  =====  ============  =====  ====  ======= 
 

Consolidated statements of cash flows

For the year ended 31 December 2021

The consolidated statements of cash flows for the Group for the years ended 31 December 2020 and 31 December 2021 are set out below:

 
                                                   Years ended 31 
                                                      December 
                                                ------------------- 
                                                    2021       2020 
                                                --------  --------- 
                                                 US$'000    US$'000 
                                                --------  --------- 
 
 Cash Flows from operating activities 
 Profit (Loss) before tax for the period          (516)      946 
 
 Adjustment for: 
 Amortisation of intangible assets                  -         75 
 Impairment of intangible assets, net               -         37 
 Gain on bargain purchase                                   (309) 
 Depreciation of property and equipment             -         4 
 Revaluation of traded securities                 (87) 
 Share option charge                                -         6 
 Waiver of loan due to NCI                          -        (51) 
 Loss on disposal of subsidiary                    30         - 
 Capital loss on disposal of property 
  and equipment                                     -         12 
 Gain from revaluation of intangible assets         -       (577) 
 Impairment of investment                          152        - 
 Income tax expenses                                -         92 
 
 Operating cash flows before movements 
  in working capital: 
 Decrease in trade and other receivables           13        589 
 Decrease in long term receivables                  -         - 
 Increase (decrease in trade and other 
  payables                                          15      (1,453) 
 R&D tax credit received                            -        163 
 Income tax paid                                  (92)      (109) 
                                                --------  --------- 
 Net cash used for operating activities           (485)     (575) 
                                                --------  --------- 
 
 Cash flows from investing activities 
 Decrease in restricted bank deposits               -         71 
 Consideration from sale of intangible 
  assets                                            -        974 
 Net cash acquired on acquisition (note 
  A)                                                -        649 
 Net cash on disposal of a subsidiary             (75)        - 
 Loans eliminated from obtaining control 
  of a subsidiary                                   -       (296) 
 Purchase of traded securities                    (102)       - 
 Sale of traded securities                         163        - 
 Funds advanced under SAFE agreement                -       (152) 
                                                --------  --------- 
 Net cash generated from (used in) investing 
  activities                                      (14)      1,246 
                                                --------  --------- 
 
 
 Net increase (decrease) in cash and 
  cash equivalents                                (499)      671 
 Cash and equivalents at beginning of 
  period                                          1,419      672 
 Effect of changes in exchange rates on 
  Cash                                              -         76 
                                                --------  --------- 
 Cash and equivalents at end of period             920      1,419 
                                                ========  ========= 
 

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