SEALAND CAPITAL GALAXY LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
1
SEALAND CAPITAL GALAXY LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
CONTENTS
Corporate Information
Chairman’s Statement
Directors’ Report
Statement of Directors’ Responsibilities
Independent Auditor’s Report
Consolidated Statement of Profit or Loss
Consolidated Statement of Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
PAGES
1
2
3 – 7
8
9 – 12
13
14
15
16
17
Notes to the Consolidated Financial Statements
18 – 40
2
SEALAND CAPITAL GALAXY LIMITED
CORPORATE INFORMATION
Board of Directors
Executive Director:
Mr Chung Lam Nelson Law
(Chairman and Chief Financial Officer)
Non-executive Director:
Mr Geoffrey John Griggs
Company Secretary
Registered Office
Independent Auditor
Collas Crill Corporate Services Limited
Willow House, PO Box 709,
Cricket Square, Grand Cayman,
KY1-1107, Cayman Islands
Willow House, PO Box 709,
Cricket Square, Grand Cayman,
KY1-1107, Cayman Islands
PKF Littlejohn LLP (Statutory Auditor)
15 Westferry Circus,
London E14 4HD,
United Kingdom
Principal Banker
China Construction Bank (Asia) Corporation Limited
Legal advisers for English law
Legal advisers for Cayman Islands law
Hill Dickinson LLP
The Broadgate Tower,
20 Primrose Street,
London EC2A 2EW
Collas Crill & CARD
Willow House, PO Box 709,
Cricket Square, Grand Cayman,
KY1 1107, Cayman Islands
1
SEALAND CAPITAL GALAXY LIMITED
CHAIRMAN’S STATEMENT
Dear Shareholders
I hereby present the annual report of Sealand Capital Galaxy Limited (the “Company” or “Sealand”, together with
its subsidiaries, the “Group”) for the year ended 31 December 2023 (the “Year”).
PERFORMANCE FOR THE YEAR
The Group reported a loss of £427,046 (2022: £179,569) during the Year. The Group encountered an economic
downturn marked by rising interest rates, resulting in escalated operational expenses for our regular customers and
become more conservative in placing orders. Moreover, the devaluation of the RMB by 10% had a profound impact
on Chinese travelers, leading to reduced purchasing power. The Group’s revenue for the Year decreased by 44.52%
to £125,793 (2022: £226,750). These circumstances posed significant challenges for the Group, requiring us to
reevaluate and adapt to the changing economic landscape. Despite these obstacles, the Group remain steadfast in
overcoming these hurdles and seizing potential avenues for sustainable growth.
The Group will enhance sales by implementing strategic product combinations that effectively reduce the retail
price, thereby enticing customers to make additional purchases. Emphasizing larger quantities sold at a lower gross
profit margin, our primary objective is to maximize revenue generation.
KEY DEVELOPMENTS FOR THE YEAR
The Company, through one of its wholly owned subsidiaries, has achieved a significant milestone by successfully
extending the sole distributorship for the brand HH Simonsen in the Hong Kong area for an additional three years.
This contract renewal underscores the strong partnership and commitment to representing the brand in this thriving
market.
The extension of this distributorship contract comes with a projected moderate growth of 5% in sales each year.
This consistent growth trajectory reflects the Group’s dedication to maximizing sales potential and capturing
market demand. With the Group’s deep understanding of the product's unique features and our proven sales
expertise, the Group is confident to achieve the ambitious sales targets in the upcoming years.
This achievement not only solidifies the position as the exclusive distributor but also highlights our unwavering
commitment to delivering exceptional products to our valued customers. The Group remain focused on enhancing
customer satisfaction and fostering long-term relationships with the clientele.
FUTURE PROSPECTS AND OUTLOOK
Despite the global economy experiencing sluggish growth in the aftermath of the pandemic, the Group remains
dedicated to enhancing its performance. However, the Group acknowledge the challenges posed by ongoing
political conflicts between nations. Nevertheless, the Group is steadfast in belief that the Group can expand our
sales within our region, employing a strategic approach that emphasizes the expansion of direct sales through
online shopping platforms.
In response to the evolving business landscape, the Group is committed to leveraging the power of e-commerce to
reach a wider customer base. By capitalizing on the convenience and accessibility of online shopping, the Group
aim to tap into new markets and optimize our sales potential. The Group focus on expanding direct sales channels
aligns with the goal of fostering meaningful customer relationships and delivering unparalleled value.
ACKNOWLEDGEMENTS
We wish to express our appreciation to our shareholders, business partners and suppliers for their continued support
during what has been a difficult time for all. We would like to thank our dedicated staff for their contributions to
the success of the Group.
Chung Lam Nelson Law
Chairman
30 April 2024
2
SEALAND CAPITAL GALAXY LIMITED
DIRECTORS’ REPORT
The directors present their report, together with the audited financial statements of Sealand Capital Galaxy Limited
and its subsidiaries for the year ended 31 December 2023 (the “Year”).
The Company
Sealand Capital Galaxy Limited was incorporated in the Cayman Islands on 22 May 2015 as an exempted company
with limited liability under the Companies Law. The Company’s registered office is Willow House, PO Box 709,
Cricket Square, Grand Cayman, KY1-1107, Cayman Islands.
Principal activities
The Company’s nature of operations is to act as a Special Purpose Acquisition Company.
The Group engaged in digital marketing and other IT and e-Commerce related businesses.
Results and dividends
The results are set out in the primary statements on pages 13 to 14 of the financial statements. The directors do not
recommend a payment of dividend for the Year (2022: Nil).
Business review and management report
Overview
During the Year, The Group recorded a consolidated loss of £427,046 (2022: £179,569) as set out on page 13 of
these financial statements.
Operations
The revenue from the e-Commerce business for the Year decreased from £224,562 to £124,492. The decrease is
mainly due to the rising interest rates and devaluation of RMB, resulting in conservative approach in placing orders
by customers and decrease in purchasing power of the end-consumers.
Going concern
As at 31 December 2023, the Group has cash and cash equivalent balances and net liabilities and net current
liabilities of £9,111, £1,268,073 and £1,282,251, respectively.
The director’s cash-flow projections for the forthcoming 12 months conclude there will be the need for additional
cash resources to fully implement the business plans. A director has confirmed to provide financial supports to the
Group and granted loan of approximately £80,000 to the Group subsequent to the reporting period for supporting
the Group’s operation for the forthcoming 12 months. In addition, the directors are in non-binding discussions with
individuals and institutions that may lead to further equity and/or loans being raised. There may be uncertainty
that any such funds will be forthcoming or the price and other terms being acceptable and as such there is a material
uncertainty over going concern.
3
SEALAND CAPITAL GALAXY LIMITED
DIRECTORS’ REPORT (CONTINUED)
Our strategy
As the Company strives for long-term growth, we remain committed to pursuing a strategic approach that
encompasses various facets of our business. In line with this vision, the Group actively seek out selective and
attractive investment opportunities that align with our goals and values.
Notably, the Group have observed significant progress in certain business categories within the China region. This
development serves as a promising signal, prompting us to explore potential cooperative opportunities through
partnerships and collaborations. By leveraging the strengths and expertise of like-minded entities, the Group aim
to drive mutual growth and unlock new avenues of success.
Our approach to identifying and pursuing these opportunities is rooted in thorough analysis, meticulous evaluation,
and prudent decision-making. The Group prioritize partnerships that complement the existing capabilities and align
with our strategic objectives. Through these collaborative ventures, we seek to enhance our market position,
expand our customer base, and diversify our offerings.
Outlook
The Group will continue to monitor market developments and will manage its businesses and investment portfolio
with a view to further improving its overall asset quality and potential growth. The Group will also continue to
manage its assets and assess new investment opportunities to achieve stable growth and enhance shareholders’
value.
Event after the reporting period
Subsequent to the reporting period, the Company remains actively engaged in pursuing potential capital injections
through various avenues within the capital market. We recognize the importance of securing additional financial
resources to support our growth strategies and enhance our operational capabilities.
The Group is currently in non-binding negotiations with individuals and institutions regarding potential loan grants.
These discussions reflect our commitment to exploring viable funding options that align with our long-term
objectives. By leveraging external financial support, the Group aim to strengthen our financial position and
maximize our potential for sustainable growth.
Directors
The following directors served during the year ended 31 December 2023:
Mr Chung Lam Nelson Law
Mr Geoffrey John Griggs
(Chairman and Chief Financial Officer)
(Non-executive Director)
Substantial shareholding
At 31 December 2023, the Company has been notified of the following interests of 3 per cent or more in its issued
share capital as at the date of approval of this report:
Name
Chung Lam Nelson Law *
Computershare Company Nominees Limited
Premium Full Limited
Tien San Chua
Ahead Eternity Limited
(* indicates a director of the Company)
Number of
Ordinary Shares
Approximate
% Shareholding
349,854,461
117,525,104
93,786,896
72,000,000
55,000,000
48.87%
16.42%
13.10%
10.06%
7,68%
4
SEALAND CAPITAL GALAXY LIMITED
DIRECTORS’ REPORT (CONTINUED)
Directors’ interests
The directors’ interests in the share capital of the Company as at 31 December 2023 are shown below. All interests
are beneficial.
Mr Chung Lam Nelson Law
Directors’ emoluments are detailed in Note 10 to the financial statements.
Share capital and voting rights
Number of
Ordinary Shares
349,854,461
Details of the share capital and movements in share capital during the year are disclosed in Note 19 to the financial
statements.
Ratio of men to women
At 31 December 2023, there was one women (2022: 1) employed across the Group making 33% (2022: 14%) of
our Group-wide employee base.
The Directors are satisfied that it has the appropriate balance of skills, experience and expertise necessary, and will
give due regard to diversity in the event of further changes to both its own membership and/or the membership of
the senior management team.
Climate - Related Financial Disclosure
The Company’s objective is to enhance the Company's strategies, structures, resources, and tools in order to
adeptly address and leverage climate-related risks and opportunities.
The Company ensures that its financial disclosures related to climate issues adhere to internationally recognized
standards, with particular emphasis on the four fundamental components established by the Task Force on Climate-
related Financial Disclosures (TCFD).
Core Elements
Governance
Strategy
Risk
Management
Metrics
targets
and
of
risks
Description
Structures and processes in place to oversee
climate-related issues, including the role of the
board, management, and relevant committees.
Insights into the company's actual and potential
impacts
and
climate-related
opportunities on its business, strategy, and
financial planning
Processes used to identify, assess, and manage
climate-related risks integrated into overall risk
management. Adaptations
in
response to climate considerations.
Disclosure of metrics and targets used to assess
and manage relevant climate-related risks and
opportunities,
quantitative
providing
information on performance and progress.
to strategies
TCFD pillar
Governance
The table below shows our current progress against TCFD Recommendations
Recommended Disclosure
The Board's supervision of
risks and
opportunities associated with climate-related
factors.
Strategy
The influence of climate-related risks and
opportunities on
the business, strategic
decisions, and financial planning.
5
Cellular Goods Summary
The Board of Directors exercises
oversight over climate-related issues,
integrating them within the broader
framework of governance.
The Board
aware
transportation has
emissions
air
carbon
sea
compared
higher
that
are
to
Risk Management
The company’s protocols for effectively
managing climate-related risks.
transportation. Therefore, starting from
2023,
the company are gradually
transitioning our transportation method
from air to sea freight.
The process of identifying climate-
related risks is seamlessly integrated
into our regular operations. Although
we may not have a dedicated task force,
every team member is accountable for
considering climate-related risks within
their specific areas of responsibility.
climate
considerations
This decentralized approach guarantees
that
are
incorporated
into our day-to-day
decision-making processes. Given our
small team size, collaboration plays a
vital role. We regularly facilitate cross-
functional discussions to collectively
risks. By
evaluate climate-related
leveraging the expertise of each team
member, we ensure a comprehensive
understanding of potential impacts on
our supply chain, production, and
market dynamics. This collaborative
effort cultivates a shared awareness of
the challenges posed by climate-related
factors.
The carbon capture initiative entails
goals for mitigating emissions and
actively contributing to wider climate
initiatives. These metrics underscore the
to
Company’s steadfast dedication
comprehensive sustainability practices
throughout
business
portfolio.
diverse
its
Metrics and targets Metrics used by the organization to assess
climate related risks and opportunities in line
with
its strategy and risk management
process.
Greenhouse gas emissions
The Group recognizes the importance of assessing its operational carbon footprint to effectively manage and
reduce its environmental impact. However, due to the limited scale and nature of its activities during the reviewed
period, the Company's operations involve only a small number of employees and directors, and it operates from
rented offices. Consequently, the Company's carbon emissions are minimal, and it is currently impractical to gather
emissions data at this stage. In Hong Kong, the Company's energy consumption was below 14,000 KWh in 2023,
and it is currently exempt from the obligation to disclose its sources of greenhouse gas and other emissions as
stipulated by the Companies Act 2006 (Strategic Report and Directors Report) Regulations 2014.
Financial risk management
The Group’s financial risk management objective is to minimise, as far as possible, the Group’s exposure to each
risk as detailed in Note 5 to the financial statements.
6
SEALAND CAPITAL GALAXY LIMITED
DIRECTORS’ REPORT (CONTINUED)
Corporate governance
As a company with a Standard Listing, the Group is not required to comply with the provisions of the Corporate
Governance Code. Although the Company has not adopted the Corporate Governance Code, it intends to adopt
such procedures as are appropriate for the size and nature of the Company and the size and composition of the
Board. These corporate governance procedures have been selected with due regard to the provision of the UK
Corporate Governance Code in particular:
given the size of the Board, certain provisions of the Corporate Governance Code (in particular the
provisions relating to the composition of the Board and the division of responsibilities between the
Chairman and chief executive and executive compensation), are not being complied with by the Company
as the Board considers these provisions to be inapplicable to the Company;
given the size of the Board, the board has not established an audit committee, a remuneration committee
and a nomination committee comprising at least one non-executive director in each committee. The Board
is taking the responsibilities to review audit and risk matters, as well as the Board’s size, structure and
composition and the scale and structure of the directors’ fees, taking into account the interests of
Shareholders and the performance of the Company, and will take responsibility for the appointment of
auditors and payment of their audit fee, monitor and review the integrity of the Company’s financial
statements and take responsibility for any formal announcements on the Company’s financial performance.
the Corporate Governance Code recommends the submission of all directors for re-election at annual
intervals. None of the directors will be required to retire by rotation and be submitted for re-election; and
the Board has complied with the provision of the Corporate Governance Code that at least half of the Board,
excluding the Chairman, should comprise non-executive directors determined by the Board to be
independent.
Auditors
The auditors, PKF Littlejohn LLP, have expressed their willingness to continue in office and a resolution to
reappoint them will be proposed at the Annual General Meeting.
Disclosure of Information to Auditors
So far as the directors are aware, there is no relevant audit information of which the Company’s auditors are
unaware, and each Director has taken all the steps that he ought to have taken as a Director in order to make himself
aware of any relevant audit information and to establish that the Company’s auditors are aware of that information.
By order of the board
Chung Lam Nelson Law
Chairman
30 April 2024
7
SEALAND CAPITAL GALAXY LIMITED
STATEMENT OF DIRECTORS’ RESPONSIBILITIES
The directors are responsible for preparing the annual report and the financial statements in accordance with
applicable laws and regulations. The directors are required to prepare financial statements for the Group in
accordance with International Financial Reporting Standards (“IFRSs”).
The directors must not approve the financial statements unless they are satisfied that they give a true and fair view
of affairs of the Group and of the profit or loss of the Group for that period. In preparing the financial statements,
the directors are required to:
-
Select suitable accounting policies and then apply them consistently;
- Make judgments and accounting estimates that are reasonable and prudent;
-
-
State whether applicable IFRSs have been followed, subject to any material departures disclosed and
explained in the financial statements; and
Prepare the financial statements on the going concern basis unless it is inappropriate to presume that the
Company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the
Group’s transactions and disclose with reasonable accuracy at any time the financial position of the Group and
enable them to ensure that the financial statements comply with applicable law. They are also responsible for
safeguarding the assets of the Group and hence for taking reasonable steps for the prevention and detection of
fraud and other irregularities.
The directors are responsible for the maintenance and integrity of the corporate and financial information included
on the Company’s website.
Legislation in the Cayman Islands governing the preparation and dissemination of the accounts and the other
information included in annual reports may differ from legislation in other jurisdictions.
Directors’ Responsibility Statement Pursuant to Disclosure and Transparency Rules
Each of the directors, whose names and functions are listed on page 1, confirms that, to the best of their knowledge
and belief:
-
-
the financial statements prepared in accordance with IFRSs, give a true and fair view of the assets, liabilities,
financial position and loss of the Group and parent company; and
the Annual Report and financial statements, including the Business review, includes a fair review of the
development and performance of the business and the position of the Group, together with a description of
the principal risks and uncertainties that they face.
By order of the board
Chung Lam Nelson Law
Chairman
30 April 2024
8
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF SEALAND CAPITAL GALAXY
LIMITED
Opinion
We have audited the Group financial statements of Sealand Capital Galaxy Limited (‘the Group’) for the year
ended 31 December 2023 which comprise the Consolidated Statement of Profit or loss, the Consolidated Statement
of Comprehensive Income, the Consolidated Statement of Financial Position, the Consolidated Statement of
Changes in Equity, the Consolidated Statement of Cash Flows and notes to the financial statements, including
significant accounting policies. The financial reporting framework that has been applied in their preparation is
International Financial Reporting Standards (IFRSs).
In our opinion, the Group financial statements:
•
give a true and fair view of the state of the Group’s affairs as at 31 December 2023 and of its loss for the
year then ended; and
•
have been properly prepared in accordance with International Financial Reporting Standards (IFRSs).
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable
law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit
of the financial statements section of our report. We are independent of the Group in accordance with the ethical
requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical
Standard as applied to listed entities, and we have fulfilled our other ethical responsibilities in accordance with
these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a
basis for our opinion.
Material uncertainty related to going concern
We draw attention to note 4(p) in the Group financial statements, which indicates that the Group incurred a net
loss of £427,046 during the year ended 31 December 2023 and, as of that date, the Group was in a net liability
position of £1,268,073. As stated in note 4(p), the directors’ cash flow projections for the following 12 months
conclude that there will be the need for additional cash resources to fully implement the business plans. A director
has confirmed to provide financial supports to the Group and granted loan of approximately £80,000 to the Group
subsequent to the reporting period for supporting the Group’s operation for the forthcoming 12 months. In addition,
the directors are in non-binding discussions with individuals and institutions that may lead to further equity and/or
loans being raised. There may be uncertainty that any such funds will be forthcoming. These events or conditions,
along with the other matters as set forth in note 4(p), indicate that a material uncertainty exists that may cast
significant doubt on the Group’s ability to continue as a going concern. Our opinion is not modified in respect of
this matter.
In auditing the Group financial statements, we have concluded that the directors’ use of the going concern basis of
accounting in the preparation of the Group financial statements is appropriate. Our evaluation of the directors’
assessment of the Group’s ability to continue to adopt the going concern basis of accounting included obtaining
managements’ forecasts to the period ended 30 April 2025 and challenging the key assumptions and inputs within.
In order for the Group to meet their liabilities as they fall due, the Group will need to raise funds either from
existing shareholders or the open market.
9
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the
relevant sections of this report.
Our application of materiality
The scope of our audit was influenced by our application of materiality. The quantitative and qualitative thresholds
for materiality determine the scope of our audit and the nature, timing and extent of our audit procedures. The
materiality applied to the Group financial statements was £61,000 (2022: £31,200) based on 5% (2022: 5%) of the
net liabilities at the year end. The performance materiality was £42,700 (2022: £21,840), being 70% (2022: 70%)
of overall materiality to ensure sufficient coverage for group reporting purposes. For each component in the scope
of our Group audit, we allocated a materiality that is less than our overall Group materiality. As a Group whose
main aim is to maintain its operation as a going concern, net liabilities of the Group were considered the most
appropriate benchmarks to shareholders.
We agreed with those charged with governance that we would report all differences identified during the course
of our audit in excess of £3,050 (2022: £1,560) as well as those that we believe warranted reporting on qualitative
grounds.
Our approach to the audit
In designing our audit, we determined materiality and assessed the risks of material misstatement in the Group
financial statements. In particular we looked at areas involving significant accounting estimates and judgements
by the directors and considered future events that are inherently uncertain. As in all of our audits, we also addressed
the risk of management override of internal controls, including among other matters consideration of whether there
was evidence of bias that represented a risk of material misstatement due to fraud.
Of the 10 components of the Group, a full scope audit was performed on the complete financial information of 5
components, and the remaining components were subject to analytical review only because they were not
significant to the Group.
Of the above 5 components of the Group, 4 are located in Hong Kong and audited by a component audit team
operating under our instruction, and the audit of the remaining component were performed by us using a team with
specific experience in auditing groups and publicly listed entities. The engagement partner interacted regularly
with the component audit team during all stages of the audit and was responsible for the scope and direction of the
audit process. This, in conjunction with additional procedures performed, gave us appropriate evidence for our
opinion on the Group financial statements.
Key audit matters
Except for the matter described in the Material uncertainty related to going concern section, we have determined
that there are no other key audit matters to communicate in our report.
Other information
The other information comprises the information included in the annual report, other than the Group financial
statements and our auditor’s report thereon. The directors are responsible for the other information contained
within the annual report. Our opinion on the Group financial statements does not cover the other information and,
10
we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the Group financial
statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated.
If we identify such material inconsistencies or apparent material misstatements, we are required to determine
whether this gives rise to a material misstatement in the Group financial statements themselves. If, based on the
work we have performed, we conclude that there is a material misstatement of this other information, we are
required to report that fact.
We have nothing to report in this regard.
Responsibilities of directors
As explained more fully in the statement of directors’ responsibilities, the directors are responsible for the
preparation of the Group financial statements and for being satisfied that they give a true and fair view, and for
such internal control as the directors determine is necessary to enable the preparation of Group financial statements
that are free from material misstatement, whether due to fraud or error.
In preparing the Group financial statements, the directors are responsible for assessing the Group’s ability to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern
basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or have no
realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the Group financial statements as a whole are free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with
ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error
and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the
economic decisions of users taken on the basis of these Group financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures
in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities,
including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is
detailed below:
• We obtained an understanding of the Group and the sector in which they operate to identify laws and
regulations that could reasonably be expected to have a direct effect on the Group financial statements.
We obtained our understanding in this regard through discussions with management, and application of
our cumulative audit knowledge and experience of the sector.
• We determined the principal laws and regulations relevant to the Group in this regard to be those arising
from LSE Listing Rules, Disclosure Guidance and Transparency Rules, Cayman Islands laws and local
regulations, like local Companies Ordinances, local tax laws and local employment laws applicable to the
subsidiaries.
• We designed our audit procedures to ensure the audit team considered whether there were any indications
of non-compliance by the Group with those laws and regulations. These procedures included, but were
not limited to: enquiries of management, review of board minutes and Regulatory News Service (RNS)
announcements and review of legal and regulatory correspondence.
• We also identified the risks of material misstatement of the Group financial statements due to fraud. We
considered, in addition to the non-rebuttable presumption of a risk of fraud arising from management
override of controls, that the potential for management bias was identified in relation to the impairment
11
assessment of trade and other receivables. We addressed this by challenging the assumptions and
judgements made by management when evaluating any indicators of impairment.
• As in all of our audits, we addressed the risk of fraud arising from management override of controls by
performing audit procedures which included but were not limited to: the testing of journals; reviewing
accounting estimates for evidence of bias; and evaluating the business rationale of any significant
transactions that are unusual or outside the normal course of business.
• We engaged with our component auditors to ensure they assessed whether there were any instances of
non-compliance with laws and regulations at a local level and ensured they reported any such breached
or concerns to us. None were noted at the component or Group level.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including
those leading to a material misstatement in the Group financial statements or non-compliance with regulation. This
risk increases the more that compliance with a law or regulation is removed from the events and transactions
reflected in the Group financial statements, as we will be less likely to become aware of instances of non-
compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud
involves intentional concealment, forgery, collusion, omission or misrepresentation.
A further description of our responsibilities for the audit of the financial statements is located on the Financial
Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our
auditor’s report.
Use of our report
This report is made solely to the company’s members, as a body, in accordance our engagement letter dated 6
February 2024. Our audit work has been undertaken so that we might state to the company’s members those matters
we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by
law, we do not accept or assume responsibility to anyone, other than the company and the company's members as
a body, for our audit work, for this report, or for the opinions we have formed.
Mark Ling (Engagement Partner)
For and on behalf of PKF Littlejohn LLP
Registered Auditor
30 April 2024
15 Westferry Circus
Canary Wharf
London E14 4HD
12
SEALAND CAPITAL GALAXY LIMITED
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
FOR THE YEAR ENDED 31 DECEMBER 2023
Revenue
Cost of services
Gross profit
Other income
Administrative expenses
Note
2023
£
2022
£
8
8
125,793
226,750
(71,893)
53,900
16,067
(133,962)
92,788
20,484
(537,554)
(449,007)
Finance cost arising from finance lease
18
(666)
(738)
Gain on disposal of subsidiaries
-
153,000
Gain on deregistration of subsidiaries
41,207
3,904
Loss before tax
Income tax expense
Loss for the year
Attributable to:
Equity holders of the Company
Non-controlling interests
Loss per share attributable to equity holders of
the Company
Basic and diluted
9
11
12
(427,046)
(179,569)
-
-
(427,046)
(179,569)
(414,232)
(12,814)
(427,046)
(177,096)
(2,473)
(179,569)
Pence
(0.06)
Pence
(0.03)
The notes to the financial statements on pages 18-40 form an integral part of these financial statements.
13
SEALAND CAPITAL GALAXY LIMITED
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
Loss for the year
(427,046)
(179,569)
Note
2023
£
2022
£
Other comprehensive income/(loss)
Items to be reclassified subsequently to profit or loss:
- Exchange differences on translation of foreign operations
- Release of translation reserve upon disposal and
deregistration of foreign subsidiaries
Other comprehensive income for the year, net of tax
Total comprehensive loss for the year
Attributable to:
Equity holders of the Company
Non-controlling interests
51,816
(170,292)
-
51,816
104,362
(65,930)
(375,230)
(245,499)
(375,246)
16
(186,197)
(59,302)
(375,230)
(245,499)
The notes to the financial statements on pages 18-40 form an integral part of these financial statement
14
SEALAND CAPITAL GALAXY LIMITED
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AT 31 DECEMBER 2023
Note
2023
£
2022
£
Non-current assets
Property, plant and equipment
Current assets
Inventories
Deposit, prepayments and other receivables
Trade receivables
Cash and cash equivalents
Current liabilities
Trade payables
Other payables and accrued expense
Amount due to a director
Finance lease liabilities
Net current liabilities
Total assets less current liabilities
Non-current liabilities
Finance lease liabilities
Net liabilities
Capital and reserves
Share capital
Reserves
Total equity attributable to equity shareholders of the
Company
Non-controlling interests
Total deficit
13
14
15
15
16
17
18
18
19
14,178
44,791
49,224
45,531
35,435
9,111
139,301
36,110
630,524
740,486
14,432
1,421,552
106,088
58,305
26,430
35,567
226,390
36,110
480,213
602,646
29,858
1,148,827
(1,282,251)
(922,437)
(1,268,073)
(877,646)
-
15,197
(1,268,073)
(892,843)
71,581
(1,018,368)
(946,787)
(321,286)
71,581
(643,122)
(571,541)
(321,302)
(1,268,073)
(892,843)
The notes to the Financial Statements on pages 18-40 form an integral part of these financial statements.
These Financial Statements were approved by the Board of Directors and authorized for issue on 30 April 2024.
Signed on behalf of the Board of Directors
……………………………………………
Chung Lam Nelson Law
Chairman
30 April 2024
15
SEALAND CAPITAL GALAXY LIMITED
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
At 1 January 2023
Loss for the year
Exchange differences arising in translation
Total comprehensive (loss)/income
Attributable to equity holders of the Company
Share
capital
£
71,581
Share
Premium
£
6,917,830
Share-based
payment
reserve
£
357,417
-
-
-
-
-
-
-
-
-
Exchange
Reserve
£
(3,720)
-
38,986
Accumulated
losses
£
(7,914,649)
Total
£
(571,541)
(414,232)
-
(414,232)
38,986
Non-
controlling
interests
£
(321,302)
(12,814)
12,830
Total
deficit
£
(892,843)
(427,046)
51,816
38,986
(414,232)
(375,246)
16
(375,230)
At 31 December 2023
71,581
6,917,830
357,417
35,266
(8,328,881)
(946,787)
(321,286)
(1,268,073)
At 1 January 2022
59,569
6,660,898
357,417
5,381
(7,737,553)
(654,288)
(369,877)
(1,024,165)
Loss of the year
Exchange differences arising in translation
Total comprehensive loss
-
-
-
-
-
-
Issue of ordinary shares (Note 19)
Disposal and deregistration of subsidiaries
12,012
-
256,932
-
-
-
-
-
-
-
(113,463)
(177,096)
-
(177,096)
(113,463)
(2,473)
(56,829)
(179,569)
(170,292)
(113,463)
(177,096)
(290,559)
(59,302)
(349,861)
-
104,362
-
-
268,944
104,362
-
107,877
268,944
212,239
At 31 December 2022
71,581
6,917,830
357,417
(3,720)
(7,914,649)
(571,541)
(321,302)
(892,843)
The notes to the financial statements on pages 18-40 form an integral part of these financial statements.
16
SEALAND CAPITAL GALAXY LIMITED
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
CASH FLOWS FROM OPERATING ACTIVITIES
Loss before tax
Adjustments for:
Depreciation
Exchange difference
Gain on disposal of subsidiaries
Gain on deregistration of subsidiaries
Share of profit of an associate
Provision for impairment loss on trade and other receivables
Provision for impairment loss on inventories
Interest expenses
Bank interest income
2023
£
2022
£
(427,046)
(179,569)
29,010
50,955
-
(41,207)
-
17,811
42,413
666
(11)
34,746
-
(153,000)
(3,904)
-
-
-
738
(10)
Operating cash flows before movements in working capital
(327,409)
(300,999)
Decrease/(increase) in inventories
Decrease/(increase) in deposit, prepayments and other
receivable
Increase in amounts due to a director
Increase in trade receivables
Increase in trade payables
Increase in other payables and accrued expenses
Net cash generated from operations
Payment of interest portion of lease liabilities
Net cash generated from operating activities
CASH FLOWS FROM INVESTING ACTIVITIES
Disposal of subsidiaries
Interest income received
Net cash used in investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
Payment of principal portion of lease liabilities
Net cash used in financing activities
14,451
12,393
137,840
(26,816)
-
192,912
3,371
(666)
2,705
(1,013)
11
(1,002)
(24,265)
(14,525)
235,618
(11,307)
16,005
311,158
211,685
(738)
210,947
(1,018)
10
(1,008)
(30,623)
(30,623)
(33,582)
(33,582)
Net (decrease)/increase in cash and cash equivalents
(28,920)
176,357
Foreign exchange realignment
Cash and cash equivalents at 1 January
Cash and cash equivalents at 31 December
2,464
35,567
9,111
(148,988)
8,198
35,567
The notes to the financial statements on pages 18-40 form an integral part of these financial statements.
17
SEALAND CAPITAL GALAXY LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
1.
GENERAL INFORMATION
Sealand Capital Galaxy Limited (the “Company”) was incorporated in the Cayman Islands on 22 May 2015
as an exempted company with limited liability under the Companies Law of the Cayman Islands. The
Company’s registered office is at Willow House, PO Box 709, Cricket Square, Grand Cayman, KY1-1107,
Cayman Islands. These consolidated financial statements comprise the Company and its subsidiaries
(together referred to as the “Group”)
The Company’s nature of operations is to act as a special purpose acquisition company.
The Group engaged in digital marketing and other IT and e-Commerce related businesses.
2.
BASIS OF PREPARATION
The financial statements have been prepared in accordance with the International Financial Reporting
Standard (“IFRSs”) and IFRIC interpretations applicable to companies reporting under IFRSs.
These financial statements are presented in Great British Pounds (“£”) rounded to the nearest Great British
Pound, except for otherwise indicated, and have been prepared under the historical cost convention.
Details of going concern are included in note 4(p).
3.
STANDARDS AND INTERPRETATIONS
(i)
New standards, amendments and interpretations adopted by the Group and Company
The following IFRS or IFRIC interpretations were effective for the first time for the financial year
beginning 1 January 2023. Their adoption has not had any material impact on the disclosures or on
the amounts reported in these financial statements:
Standard / Interpretation
Application
Amendments to IAS 1 and IFRS Practice Statement 2 Disclosure of Accounting Policies
Amendments to IAS 8
Amendments to IAS 12
Definition of Accounting Estimates
Deferred Tax related to Assets and Liabilities
arising from a Single Transaction
(ii) New standards, amendments and interpretations not yet adopted
Standard / Interpretation
Application
IAS 1 amendments
IAS 1 amendments
IFRS 16 amendments
IAS 7 & IFRS 7 amendments
IAS 21 amendments
Amendments to IFRS 10 and IAS 28
Classification of Liabilities as Current or Non-current
Effective: Annual periods beginning on or after 1 January 2024
Non-current Liabilities with Covenants
Effective: Annual periods beginning on or after 1 January 2024
Lease liability in a Sale and Leaseback
Effective: Annual periods beginning on or after 1 January 2024
Supplier finance arrangements
Effective: Annual periods beginning on or after 1 January 2025
Lack of Exchangeability
Effective: Annual periods beginning on or after 1 January 2025
Sale or Contribution of Assets between an Investor and its
Associate or Joint Venture
Effective: To be determined
There are no IFRSs or IFRIC interpretations that are not yet effective that would be expected to have
a material impact on the Company or Group.
18
SEALAND CAPITAL GALAXY LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
4.
SIGNIFICANT ACCOUNTING POLICIES
(a)
Basis of consolidation
These financial statements comprise the financial statements of the Company and entities controlled
by the Company (its subsidiaries) for the year ended 31 December 2023.
Control is achieved when the Group is exposed, or has rights, to variable returns from its
involvement with the investee and has the ability to affect those returns through its power over the
investee. Specifically, the Group controls an investee if, and only if, the Group has:
Power over the investee (i.e., existing rights that give it the current ability to direct the relevant
activities of the investee)
Exposure, or rights, to variable returns from its involvement with the investee
The ability to use its power over the investee to affect its returns
Generally, there is a presumption that a majority of voting rights results in control. To support this
presumption and when the Group has less than a majority of the voting or similar rights of an
investee, the Group considers all relevant facts and circumstances in assessing whether it has power
over an investee, including:
The contractual arrangement(s) with the other vote holders of the investee
Rights arising from other contractual arrangements
The Group’s voting rights and potential voting rights
(i)
Business combinations
The Group accounts for business combinations using the acquisition method when control is
transferred to the Group. The consideration transferred in the acquisition is generally
measured at fair value, as are the identifiable net assets acquired. Any goodwill that arises is
tested annually for impairment. Any gain on a bargain purchase is recognised in profit or loss
immediately. Transaction costs are expensed as incurred, except if related to the issue of debt
or equity securities.
The consideration transferred does not include amounts related to the settlement of pre-
existing relationships. Such amounts are generally recognised in profit or loss.
Any contingent consideration is measured at fair value at the date of acquisition. If an
obligation to pay contingent consideration that meets the definition of a financial instrument
is classified as equity, then it is not remeasured and settlement is accounted for within equity.
Otherwise, other contingent consideration is remeasured at fair value at each reporting date
and subsequent changes in the fair value of the contingent consideration are recognised in
profit or loss.
(ii)
Subsidiaries
Subsidiaries are entities controlled by the Group. The Group controls an entity when it is
exposed to, or has rights to, variable returns from its involvement with the entity and has the
ability to affect those returns through its power over the entity. The financial statements of
subsidiaries are included in the consolidated financial statements from the date on which
control commences until the date on which control ceases.
19
SEALAND CAPITAL GALAXY LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
4.
SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(a)
Basis of consolidation (Continued)
(iii) Loss of control
When the Group loses control over a subsidiary, it derecognises the assets and liabilities
of the subsidiary, and any related NCI and other components of equity. Any resulting gain or
loss is recognised in profit or loss. Any interest retained in the former subsidiary is measured
at fair value when control is lost. A change in the ownership interest of a subsidiary, without
a loss of control, is accounted for as an equity transaction.
(iv) Transactions eliminated on consolidation
Intra-group balances and transactions, and any unrealised income and expenses arising from
intra-group transactions, are eliminated. Unrealised gains arising from transactions with
equity-accounted investee are eliminated against the investment to the extent of the Group’s
interest in the investee. Unrealised losses are eliminated in the same way as unrealised gains,
but only to the extent that there is no evidence of impairment.
(b) Revenue recognition
Revenue is recognised to depict the transfer of goods and services to customers in an amount that
reflects the consideration to which the Group expects to be entitled in exchange for those goods or
services. Specifically, the Group uses a 5-step approach to revenue recognition:
Step 1: Identify the contract(s) with a customer;
Step 2: Identify the performance obligations in the contract;
Step 3: Determine the transaction price;
Step 4: Allocate the transaction price to the performance obligations in the contract; and
Step 5: Recognise revenue when (or as) the entity satisfies a performance obligation.
The Group recognises revenue when (or as) a performance obligation is satisfied, i.e. when “ control”
of the goods or services underlying the particular performance obligation is transferred to customers.
A performance obligation represents a good or service (or a bundle of goods or services) that is
distinct or a series of distinct goods or services that are substantially the same.
Control is transferred over time and revenue is recognised over time by reference to the progress
towards complete satisfaction of relevant performance obligation if one of the following criteria is
met:
-
-
-
the customer simultaneously receives and consumes the benefits provided by the entity’s
performance as the Group performs;
the Group’s performance creates and enhances an asset that the customer controls as the Group
performs; or
the Group’s performance does not create an asset with an alternative use to the Group and the
Group has an enforceable right to payment for performance completed to date.
Otherwise, revenue is recognised at a point in time when the customer obtains control of the distinct
good or service.
A contract asset represents the Group’s right to consideration in exchange for goods and services
that the Group has transferred to a customer that is not unconditional. It is assessed for
impairment in accordance with IFRS 9. In contrast, a receivable represents the Group’s
unconditional right to consideration, i.e. only the passage of time is required before payment of
that consideration is due.
20
SEALAND CAPITAL GALAXY LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
4.
SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(b) Revenue recognition (Continued)
A contract liability represents the Group’s obligation to transfer services to a customer for which the
Group has received consideration (or an amount of consideration is due) from the customer.
A contract asset and a contract liability relating to a contract are accounted for and presented on a
net basis.
Revenue from e-commerce service is recognised when the performance obligation is satisfied.
Interest income from a financial asset is accrued on a time basis using the effective interest method.
(c) Government grants
Government grants are recognised where there is reasonable assurance that the grant will be received
and all attached conditions will be complied with. When the grant relates to an expense item, it is
recognised as income on a systematic basis over the periods that the related costs, for which it is
intended to compensate, are expensed. When the grant relates to an asset, it is recognised as income
in equal amounts over the expected useful life of the related asset.
When the Group receives grants of non-monetary assets, the asset and the grant are recorded at
nominal amounts and released to profit or loss over the expected useful life of the asset, based on
the pattern of consumption of the benefits of the underlying asset by equal annual instalments.
(d)
Foreign currency transactions
(i)
Functional and presentational currency
Items included in the Financial Statements of each of the Group’s entities are measured using
the currency of the primary economic environment in which the entity operates (“functional
currency”), being British Pound Sterling (“GBP” or “£”), Chinese Yuan (“CNY”) and Hong
Kong Dollar (“HKD”). The Group Financial Statements are presented in GBP.
(ii)
Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange
rates prevailing at the dates of the transactions. Monetary assets and liabilities denominated
in foreign currencies are translated at the rates of exchange ruling at the Statement of
Financial Position date. Foreign exchange gains and losses resulting from the settlement of
such transactions, and from the translation at year-end exchange rates of monetary assets and
liabilities denominated in foreign currencies, are recognised in the Statement of
Comprehensive Income.
21
SEALAND CAPITAL GALAXY LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
4.
SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(d)
Foreign currency transactions (Continued)
(iii) Group companies
The results and financial position of all the Group entities that have a functional currency
different from the presentation currency are translated into the presentation currency as
follows:
-
-
the contractual arrangement(s) with the other vote holders of the investee assets and
liabilities for each statement of financial position presented are translated at the closing
exchange rate at the date of that statement of financial position;
income and expenses for each statement of comprehensive income are translated at
average exchange rates; and
- all resulting exchange differences are recognised in other comprehensive income (loss).
(e) Goodwill and intangible assets
Goodwill
Goodwill arising on an acquisition of a business is carried at cost as established at the date of
acquisition of the business less accumulated impairment losses, if any.
For the purposes of impairment testing, goodwill is allocated to each of the Group’ s cash-generating
units (or groups of cash-generating units) that is expected to benefit from the synergies of the
combination.
A cash-generating unit to which goodwill has been allocated is tested for impairment annually, or
more frequently when there is indication that the unit may be impaired. For the goodwill arising on
an acquisition in a reporting period, the cash-generating unit to which goodwill has been allocated
is tested for impairment before the end of that reporting period. If the recoverable amount of the
cash-generating unit is less than its carrying amount, the impairment loss is allocated first to reduce
the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit on
a pro rata basis based on the carrying amount of each asset in the unit. Any impairment loss for
goodwill is recognised directly in profit or loss. An impairment loss recognised for goodwill is not
reversed in subsequent periods.
On disposal of the relevant cash-generating unit, the attributable amount of goodwill is included in
the determination of the amount of profit or loss on disposal.
(f)
Property, plant and equipment
Property, plant and equipment is measured on the cost basis and therefore stated at historic cost less
accumulated depreciation. Historic cost includes expenditure that is directly attributable to the
acquisition of the items.
All repairs and maintenance expenditure is charged to the Consolidated Statement of Profit or Loss
during the financial period in which they are incurred.
Depreciation is calculated using the straight-line method to allocate their cost over their estimated
useful lives, as follows:
22
SEALAND CAPITAL GALAXY LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
4.
SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(f)
Property, plant and equipment (Continued)
Owned assets
Office equipment
Leasehold improvement
Right-of-use assets
Buildings
36 - 60 months
lower of 36 months and the lease term
Over the lease term
The assets’ useful lives are reviewed, and, if appropriate, asset values are written down to their
estimated recoverable amounts, at each reporting date. Gains and losses on disposals are determined
by comparing proceeds with the carrying amounts, and are included in profit or loss.
(g)
Impairment of non-financial assets
Goodwill and intangible assets with indefinite useful lives or those not yet available for use are not
subject to amortisation and are tested for impairment at least annually, irrespective of whether there
is any indication that they are impaired. All other assets are tested for impairment whenever there
are indications that the asset’s carrying amount may not be recoverable. An impairment loss is
recognised as an expense immediately for the amount by which the asset’ s carrying amount exceeds
its recoverable amount. Recoverable amount is the higher of fair value, reflecting market conditions
less costs of disposal, and value in use. In assessing value in use, the estimated future cash flows are
discounted to their present value using a pre-tax discount rate that reflects current market assessment
of time value of money and the risk specific to the asset. For the purposes of assessing impairment,
where an asset does not generate cash inflows largely independent from other assets, the recoverable
amount is determined for the smallest group of assets that generate cash inflows independently (i.e.
a cash-generating unit). As a result, some assets are tested individually for impairment and some are
tested at cash-generating unit level. Goodwill in particular is allocated to those cash-generating units
that are expected to benefit from synergies of the related business combination and represent the
lowest level within the Group at which the goodwill is monitored for internal management purpose
and not be larger than an operating segment.
Impairment losses recognised for cash-generating units, to which goodwill has been allocated, are
credited initially to the carrying amount of goodwill. Any remaining impairment loss is charged pro-
rata to the other assets in the cash generating unit, except that the carrying value of an asset will not
be reduced below its individual fair value less cost of disposal, or value in use, if determinable. An
impairment loss on goodwill is not reversed in subsequent periods. In respect of other assets, an
impairment loss is reversed if there has been a favourable change in the estimates used to determine
the asset’s recoverable amount and only to the extent that the asset’s carrying amount does not
exceed the carrying amount that would have been determined, net of depreciation or amortisation,
if no impairment loss had been recognised. Impairment losses recognised in an interim period in
respect of goodwill are not reversed in a subsequent period. This is the case even if no loss, or a
smaller loss, would have been recognised had the impairment been assessed only at the end of the
financial year to which the interim period relates.
23
SEALAND CAPITAL GALAXY LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
4.
SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(h)
Financial instruments
Financial assets and financial liabilities are recognised in the statements of financial position when
a group entity becomes a party to the contractual provisions of the instrument. Financial assets and
financial liabilities within the scope of IFRS 9 are initially measured at fair value and transaction
costs that are directly attributable to the acquisition or issue of financial assets and financial
liabilities are added to or deducted from the fair value of the financial assets or financial liabilities,
as appropriate, on initial recognition.
The Group’s financial assets, including deposits, receivables, contract assets and cash and cash
equivalents, are subsequently measured at amortised cost using the effective interest method, less
identified impairment charges (see Note 4(i)) as the assets are held within a business model whose
objective is to hold assets in order to collect contractual cash flows and the contractual terms of the
financial assets give rise on specific dates to cash flows that are solely payments of principal and
interest on the principal amount outstanding.
Financial liabilities include lease liabilities, trade payables, amount due to a director, other payables
and accruals. All financial liabilities are subsequently measured at amortised cost using the effective
interest method.
(i)
Impairment of financial assets
The Group recognises loss allowances for expected credit loss on the financial instruments that are
not measured at fair value. The Group considers the probability of default upon initial recognition
of financial assets and assesses whether there has been a significant increase in credit risk on an
ongoing basis.
The Group considers the credit risk on a financial instrument is low if the financial instrument has a
low risk of default, the debtor has a strong capacity to meet its contractual cash flow obligations in
the near term and adverse changes in economic and business conditions in the longer term may, but
will not necessarily, reduce the ability of the debtor to fulfill its contractual cash flow obligations.
The carrying amount of the receivables is reduced through the use of the receivable impairment
charges account. Changes in the carrying amount of the receivable impairment charges account are
recognised in profit or loss. The receivable is written off against the receivable impairment charges
account when the Group has no reasonable expectations of recovering the receivable.
If, in a subsequent period, the amount of expected credit losses decreases, the reversal would be
adjusted to the receivable impairment charges account at the reporting date. The amount of any
reversal is recognised in profit or loss.
24
SEALAND CAPITAL GALAXY LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
4.
SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(j)
Derecognition of financial assets and financial liabilities
Financial assets are derecognised when the contractual rights to receive the cash flows of the
financial assets expire; or where the Group transfers the financial assets and either (i) it has
transferred substantially all the risks and rewards of ownership of the financial assets; or (ii) it has
neither transferred nor retained substantially all the risks and rewards of ownership of the financial
assets but has not retained control of the financial assets.
Financial liabilities are derecognised when they are extinguished, i.e. when the obligation is
discharged, cancelled or expires.
(k)
Inventories
Inventories are stated at the lower of cost or net realisable value, with cost determined using the
first-in, first-out (“FIFO”) cost method. Net realisable value is the estimated selling price in the
ordinary course of business, less estimated cost necessary to make the sale. Allowances are
established to reduce the cost of excess and obsolete or damaged inventories to their estimated net
realiable value.
(l)
Trade Receivables
In determining the recoverability of trade receivables, the Group considers any change in the credit
quality of the trade receivables from the initial recognition date to the end of each of the reporting
period. In the opinion of the directors of the Company, apart from those balances for which
allowances have been provided, other trade receivables at the end of each reporting period are of
good credit quality which considering the high credibility of these customers, good track record with
the Group and subsequent settlement, the management believes that no impairment allowance is
necessary in respect of unsettled balances.
The Group applied the simplified approach to provide the expected credit losses (“ECL”) prescribed
by IFRS 9. The impairment methodology is set out in Note 4 and Note 5(iii) respectively. As part of
the Group’s credit risk management, the Group assesses the impairment for its customers based on
different group of customers which share common risk characteristics that are representative of the
customers’ abilities to pay all amounts due in accordance with the contractual terms.
(m) Cash and cash equivalents
Cash and cash equivalents include cash in hand and deposits held at call with banks.
(n) Current and deferred income tax
Income tax comprises current and deferred tax. Current income tax is recognised in the profit or loss,
except to the extent that it relates to items recognised directly in equity. In this case the tax is also
recognised directly in other comprehensive income or directly in equity, respectively.
Current income tax is calculated on the basis of the tax laws enacted or substantively enacted at the
end of the reporting period in the countries where the Company’s subsidiaries operate and generate
taxable income. Management periodically evaluates positions taken in tax returns with respect to
situations in which applicable tax regulation is subject to interpretation. It establishes provisions
where appropriate on the basis of amounts expected to be paid to the tax authorities.
25
SEALAND CAPITAL GALAXY LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
4.
SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(n) Current and deferred income tax (Continued)
Deferred income tax is recognised, using the liability method, on temporary differences arising
between the tax bases of assets and liabilities and their carrying amounts in the Consolidated
Financial Statements. However, the deferred tax is not accounted for if it arises from initial
recognition of an asset or liability in a transaction other than a business combination that, at the time
of the transaction, affects neither accounting nor taxable profit or loss. Deferred income tax is
determined using tax rates (and laws) that have been enacted, or substantially enacted, by the end of
the reporting period and are expected to apply when the related deferred income tax asset is utilised,
or the deferred income tax liability is settled.
Deferred income tax assets are recognised only to the extent that it is probable that future taxable
profit will be available against which the temporary differences can be utilised.
Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset
current tax assets against current tax liabilities, and when the deferred income tax assets and
liabilities relate to income taxes levied by the same taxation authority on either the taxable entity or
different taxable entities where there is an intention to settle the balances on a net basis.
(o)
Leases
Lessee
All leases with a term of more than 12 months are recognised as an asset representing the right to
use of the underlying asset and a liability representing the obligation to make lease payments, unless
the underlying asset is of low value. Both the asset and the liability are initially measured on a
present value basis. Right-of-use assets are recognised under fixed assets and are measured at cost
less any accumulated depreciation and impairment losses and adjusted for any remeasurement of the
lease liabilities. Right-of-use assets are depreciated on a straight-line basis over the shorter of the
useful life of the assets and the lease term. Lease liabilities are initially measured at the present value
of unpaid lease payments and subsequently adjusted by the effect of the interest on and the settlement
of the lease liabilities, and the re-measurement arising from any reassessment of the lease liabilities
or lease modifications.
Lessor
Leases where substantially all the risks and rewards of ownership of assets remain with the Group
are classified as operating leases. Assets leased under operating leases are included in fixed assets
and rentals receivable are credited to surplus or deficit on the straight-line basis over the lease term.
(p) Going Concern
The director’s cash-flow projections for the forthcoming 12 months conclude there will be the need
for additional cash resources to fully implement the business plans. A director has confirmed to
provide financial supports to the Group and granted loan of approximately £80,000 to the Group
subsequent to the reporting period for supporting the Group’s operation for the forthcoming 12
months. In addition, the directors are in non-binding discussions with individuals and institutions
that may lead to further equity and/or loans being raised. There may be uncertainty that any such
funds will be forthcoming or the price and other terms being acceptable and as such there is a
material uncertainty over going concern.
(q)
Employee benefits
Salaries, wages, paid annual leave, bonuses and non-monetary benefits are accrued in the Year in
which the associated services are rendered by the employees of the Group.
26
SEALAND CAPITAL GALAXY LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
4.
SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(r)
Share capital
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new
shares or options are shown in equity as a deduction, net of tax, from the proceeds.
(s)
Share-based payments
Equity-settled share-based payment transactions in exchange for services of goods are measured at
the fair value of the goods or services received, except where that fair value cannot be estimated
reliably, in which case they are measured at the fair value of the equity instruments granted,
measured at the date the entity obtains the goods or the counterparty renders the service. The fair
value excludes the effect of non-market-based vesting conditions. Details regarding the
determination of the fair value of equity-settled share-based transactions are set out in Note 21.
The fair value determined at the grant date of the equity-settled share-based payments is expensed
on a straight-line basis over the vesting period, based on the Group’s estimate of the number of
equity instruments that will eventually vest. At each reporting date, the Group revises its estimate of
the number of equity instruments expected to vest as a result of the effect of non-market-based
vesting conditions. The impact of the revision of the original estimates, if any, is recognised in profit
or loss such that the cumulative expense reflects the revised estimate, with a corresponding
adjustment to reserves.
5.
FINANCIAL RISK MANAGEMENT
The Board’s overall risk management strategy seeks to assist the Group in meeting its financial targets,
while minimising potential adverse effects on financial performance. Its functions include the review of
future cash flow requirements.
The Group’s activities expose it to a variety of financial risks as below.
(i)
Interest rate risk
The Group has floating rate financial assets in the form of deposit accounts with major banking
institutions of £9,111. Apart from the abovementioned amount, no other financial instrument is
subjected to interest rate risk. The interest rate risk is therefore considered minimal.
(ii)
Foreign exchange risk
Foreign currency risk is the risk to earnings or capital arising from movements in foreign exchange
rates. The Group’s foreign currency risk primarily arises from currency exposures originating from
its foreign exchange dealings and other investment activities.
The Group monitors the relative foreign exchange positions of its assets and liabilities to minimise
foreign currency risk. The foreign currency risk is managed and monitored on an ongoing basis by
senior management of the Group. It is considered by the management of the Group that the exposure
to foreign exchange risk is minimal.
27
SEALAND CAPITAL GALAXY LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
5.
FINANCIAL RISK MANAGEMENT (CONTINUED)
(iii) Credit risk
Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other
party by failing to discharge an obligation. The carrying amount of financial assets and contract
assets recognised on the consolidated statement of financial position, which is net of impairment
losses, represents the Group ’ s exposure to credit risk without taking into account the value of any
collateral held or other credit enhancements. The Group’ s maximum exposure to credit risk is
summarised in Note 23.
Most of the Group’ s cash in banks have been deposited with reputable and creditworthy banks in
Hong Kong. Management considers there is minimal credit risk associated with those balances.
(iv) Liquidity risk
Liquidity risk is the risk that the Group will encounter difficulty in meeting obligations associated
with financial liabilities. The responsibility for liquidity risk management rests with the Board of
Directors.
As at the reporting date, the Group was in a net current liabilities positions. The Group is currently
obtaining cash advances from one of a director to meet its temporary operating needs. Further, the
Board of Directors is sourcing alternatives for the Group’ s future capital needs include the issue of
equity instruments and external borrowing. These alternatives are evaluated to determine the optimal
mix of capital resources for our capital needs.
(v) Market risk
Market risk is the risk that changes in market prices, such as interest rates and foreign exchange
rates, will affect the Group’s income or the value of its holdings of financial instruments. The
objective of market risk management is to manage and control market risk exposures within
acceptable parameters, while optimising the return. The Group does not hedge these risk exposures
due to the lack of any market to purchase financial instruments.
(vi) Capital risk management
The Company manages its capital to ensure that the Company will be able to continue as a going
concern while maximising the return to shareholder through the optimisation of the debt and equity
balances.
The capital structure of the Company consists of debt and equity attributable to the owners of the
Company, comprising share capital, share premium and accumulated losses.
The directors of the Company review the capital structure regularly. As part of this review, the
directors of the Company consider the cost of capital and the associated risks, and take appropriate
actions to adjust the Company’s capital structure. The overall strategy of the Company remained
unchanged.
28
SEALAND CAPITAL GALAXY LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
6.
CRITICAL ACCOUNTING JUDGEMENTS AND KEY UNCERTAINTIES OF ESTIMATION
UNCERTAINTY
The preparation of the Group’ s financial statements requires management to make judgements, estimates
and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and their
accompanying disclosures and the disclosure of contingent liabilities. Uncertainty about these assumptions
and estimates could result in outcomes that could require a material adjustment to the carrying amounts of
the assets or liabilities affected in the future.
The estimates and underlying assumption are reviewed on an ongoing basis. Revisions to accounting
estimates are recognised in the period in which the estimate is revised if the revision affects only that period,
or in the period of the revision and future periods if the revision affects both current and future periods.
Key source of estimation uncertainty
Trade receivables and contract assets
The Group’s customer base consists of a wide range of clients and the trade receivables and contract assets
are categorised by common risk characteristics that are representative of the customers’ abilities to pay all
amounts due in accordance with the contractual terms. The Group applies a simplified approach in
calculating ECL for trade receivables and contract assets and recognises a loss allowance based on lifetime
ECL at each reporting date and has established a provision matrix that is based on its historical credit loss
experience, adjusted for forward-looking factors specific to the debtors and the economic environment. The
expected loss rate used in the provision matrix is calculated for each category based on actual credit loss
experience over the prior years and adjusted for current and forward- looking factors to reflect differences
between economic conditions during the period over which the historical data has been collected, current
conditions and the Group’s estimate on future economic conditions over the expected lives of the
receivables. There was no change in the estimation techniques or significant assumptions made during the
Year.
At 31 December 2023, a provision for impairment loss on trade receivables and contract assets of £9,500
(2022: Nil) was recognised according to the management expected loss. The Group’s trade receivables
which are past due but which the Group has not impaired as there have not been any significant changes in
credit quality of customers and the management believes that the amounts are fully recoverable.
Receivables that were neither past due nor impaired at 31 December 2023 relate to a wide range of
customers for whom there was no history of default.
The Group does not hold any collateral over trade receivables and contract assets at 31 December 2023
(2022: Nil).
Allowance for obsolete inventories
Allowance for obsolete inventories is made for those identified obsolete and slow-moving inventories and
inventories with a carrying amount higher than net realisable value. The assessment of the allowance
involves management’ s judgement and estimates on which are influenced by assumptions concerning
future sales and judgements in determining the appropriate level of inventory allowance against identified
surplus or obsolete items. Where the actual outcome in future is different from the original estimate, such
difference will impact the carrying value of inventories and allowance charge/write-back in the period in
which such estimate has been changed.
At 31 December 2023, allowance for obsolete inventories of £42,413 (2022: Nil) was recognised.
29
SEALAND CAPITAL GALAXY LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
7.
SEGMENT INFORMATION
The Chief Operating Decision Maker (“CODM”) has been identified as the executive directors of the
Company who reviews the Group’s internal reporting in order to assess performance and allocate resources.
The CODM has determined the operating segments based on these reports.
For management purposes, the Group is organised into business units based on their products and services,
and has reportable operating segments as follows:
(a)
(b)
(c)
The digital marketing and payment segment includes services on enlisting merchants to mobile
payment gateways and providing digital advertising services;
The software development and support segment includes sales and distribution of mobile game and
all other I.T. related development and support services; and
The e-commerce segment includes sales of goods through internet and provision for consultancy
services related to e-commerce.
Digital
marketing
and
payment
£
Software
development
and support
£
e-Commerce
£
Unallocated
£
Total
£
Year ended 31 December 2023
Revenue
Segment loss
Depreciation
Assets
Liabilities
Year ended 31 December 2022
Revenue
-
(1,691)
-
6
6,470
887
-
-
-
-
-
-
125,793
-
125,793
(11,838)
(413,517)
(427,046)
-
29,010
29,010
110,393
43,080
153,479
99,858
1,315,224
1,421,552
225,863
-
226,750
Segment (loss)/Profit
(53,128)
(7,920)
4,534
(123,055)
(179,569)
Depreciation
Assets
Liabilities
-
443
21,767
-
-
-
-
34,746
34,746
196,419
74,319
271,181
125,892
1,016,365
1,164,024
30
SEALAND CAPITAL GALAXY LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
7.
SEGMENT INFORMATION (CONTINUED)
Geographical information:
Revenue by Geography
2023
£
2022
£
Hong Kong
125,793
226,750
Information about major customers
For the year ended 31 December 2023, 2 external customer contributed more than 10% to the Group
revenue (2022: no external customer contributed more than 10% to the Group revenue).
8. REVENUE AND OTHER INCOME
REVENUE
Advertising services
Commission income
eCommerce sales
OTHER INCOME
Bank interest income
Government subsidy
Others
9.
LOSS BEFORE TAX
Loss before tax has been arrived at after charging:
Depreciation – Owned assets
Depreciation – Right of use assets
Cost of inventories sold
Exchange gain, net
Provision for impairment losses on trade and other receivables
Allowance for obsolete inventories
Staff cost (including Director Remuneration)
Audit fees
2022
£
2022
£
-
1,301
124,492
125,793
11
-
16,056
16,067
887
1,301
224,562
226,750
10
2,730
17,744
20,484
2023
£
2022
£
-
29,010
71,893
50,520
17,811
42,413
206,861
52,500
1,387
33,359
133,462
(125,886)
-
-
307,105
52,241
31
SEALAND CAPITAL GALAXY LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
10.
EMPLOYEES
The average number of employees during the Year was made up as follows:
Directors
Staff
Staff costs, including directors’ costs comprise:
Wages, salaries and other staff costs
Share-based remuneration
2023
2022
2
3
2
7
2023
£
2022
£
206,861
-
206,861
307,105
-
307,105
Included in the wages, salaries and other staff cost, £3,827 (2022: £26,616) represents the salaries paid to
the daughter of a director.
Key Management Remuneration
The directors’ emoluments in respect of qualifying services, which all related to short-term employee
benefits, were as follows:
Chung Lam Nelson Law
Salaries and fees – in cash
Share-based payment
Geoffrey John Griggs
Salaries and fees – in cash
Share-based payment
2023
£
2022
£
180,000
-
18,000
-
180,000
-
18,000
-
198,000
198,000
No pension contributions were made on behalf of the directors of the Company.
No share options were granted to directors during the year and year ended 31 December 2023 and 2022.
32
SEALAND CAPITAL GALAXY LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
11.
INCOME TAX
No provision for profits tax has been made in these consolidated financial statements as the Group did not
have any assessable profits. The profits tax rate for Hong Kong is currently at 16.5% (2022: 16.5%) of the
estimated assessable profits for the Year.
A reconciliation of income tax expense applicable to the loss before tax at the statutory tax rate of Hong
Kong to the income tax expense at the effective tax rate of the Group is as follows:
Loss before tax
Tax at the Hong Kong statutory tax rate of 16.5%
Effect of different tax rates in other jurisdictions
Income not subject to tax
Expenses not deductible for tax
Tax losses not recognized for the year
Utilisation of tax losses not recognised for the year
2023
£
2022
£
(427,046)
(179,569)
(70,463)
-
(7,319)
74,833
4,380
(1,431)
(29,629)
51,135
(178,623)
157,216
4,856
(4,955)
-
-
Hong Kong statutory tax rate of 16.5% is adopted in the tax reconciliation since the Group’s major operating
subsidiaries are incorporated and operated in Hong Kong and subject to Hong Kong Profits Tax.
Potential deferred tax assets arising from operating loss carryforward totalling approximately £588,000
(2022: £570,000) have not been recognised due to uncertainty as to when taxable profits will be generated.
12. BASIC AND DILUTED LOSS PER SHARE
Basic loss per share is calculated by dividing the loss attributable to the Company’ s owners of £414,232
(2022: £177,096) by the weighted average number of 715,815,080 ordinary shares (2022: 602,495,699) in
issue during 2023.
The following potential ordinary shares are anti-diluted and therefore excluded from the weighted average
number of ordinary shares for the purpose of diluted loss per share.
Effect of potential ordinary shares
Employee share options (Note 21(a))
2023
£
2022
£
105,122,539
105,122,539
Diluted loss per share was the same as basic loss per share as no potential dilutive ordinary shares were
outstanding for both the years ended 31 December 2023 and 2022.
33
SEALAND CAPITAL GALAXY LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
13. PROPERTY, PLANT AND EQUIPMENT
At 1 January 2023
Depreciation for the year
Exchange differences
At 31 December 2023
At 1 January 2022
Additions for the year
Depreciation for the year
Exchange differences
At 31 December 2022
14.
INVENTORIES
Finished goods:
Gross amount
Allowance for obsolete inventories
Office
equipment
£
Leasehold
improvement
£
Right-of-use
Assets
£
Total
£
-
-
-
-
-
-
-
-
-
-
-
-
-
1,159
-
(1,387)
228
-
44,791
(29,010)
(1,603)
14,178
14,491
59,721
(33,359)
3,938
44,791
44,791
(29,010)
(1,603)
14,178
15,650
59,721
(34,746)
4,166
44,791
2023
£
2022
£
91,637
(42,413)
49,224
106,088
-
106,088
34
SEALAND CAPITAL GALAXY LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
15. TRADE RECEIVABLES, DEPOSIT, PREPAYMENT AND OTHER RECEIVABLES
(a)
Trade receivables
Trade receivables – billed
Less: Provision for impairment loss
2022
£
25,935
(9,500)
35,435
2022
£
26,430
-
26,430
During the year, the Group has recognised a provision for impairment loss on trade receivables of
£9,500 (2022: Nil). The Group normally grants credit periods of up to 90 days to its customers as
approved by the management on a case by case basis.
The ageing analysis of trade receivables - billed (net of loss allowance) based on invoice date at the
end of the reporting period is as follows:
Within 30 days
31 to 60 days
61 to 90 days
91 to 180 days
2023
£
2022
£
14,431
1,769
1,310
17,925
35,435
9,305
6,134
2,006
8,985
26,430
The carrying amount of the Group’s trade receivables as at 31 December 2023 and 2022 was
denominated in Hong Kond Dollars.
(b) Deposit,prepayments and other receivables
Prepayments
Deposit and other receivables
Less: Provision for impairment loss
2023
£
32,684
21,158
(8,311)
45,531
2022
£
35,814
22,491
-
58,305
35
SEALAND CAPITAL GALAXY LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
16.
TRADE PAYABLES
The following is an ageing analysis of trade payables presented based on the invoice date at the end of each
reporting period:
Within 30 days
31 to 60 days
61 to 90 days
91 to 180 days
181 to 365 days
More than 365 days
2023
£
2022
£
-
-
-
-
-
36,110
36,110
-
-
-
-
-
36,110
36,110
17. AMOUNT DUE TO A DIRECTOR
The amount was unsecured, interest-free and had no fixed terms of repayment.
18. LEASE LIABILITIES
The total minimum lease liabilities under finance leases and their present values at the reporting date are as
follows:
Current portion:
Gross finance lease liabilities
Finance expense not recognised
Non-current portion:
Gross finance lease liabilities
Finance expense not recognised
The net finance lease liabilities are analysed as follows:
- Not later than 1 year
- Later than 1 year but not more than 5 years
Net finance lease liabilities
2023
£
2022
£
14,503
(71)
14,432
-
-
-
30,544
(686)
29,858
15,272
(75)
15,197
14,432
45,055
2023
£
2022
£
14,432
-
14,432
29,858
15,197
45,055
The interest on lease liabilities for the year ended 31 December 2023 was £666 (2022: £738). The Group
does not recognise right-of-use assets and lease liabilities for short-term leases and leases where the
underlying asset is of low value. The expenses for these leases for the year ended 31 December 2023 were
£Nil (2022: £ Nil).
36
SEALAND CAPITAL GALAXY LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
19. SHARE CAPITAL
2023
Number of
shares
£
2022
Number of
shares
Ordinary shares issued and
fully paid
At 1 January
Issue of shares
715,815,080
-
71,581
-
595,694,385
120,120,695
At 31 December
715,815,080
71,581
715,815,080
£
59,569
12,012
71,581
On 20 December 2022, the Company has issued 115,211,604 new ordinary shares of 0.21 pence each to
Mr. Nelson Law, the Company’s Chairman and Chief Financial Officer, for the conversion of the loan
owned to him of £241,944.
On 4 April 2022, the Company has issued 4,909,091 new ordinary shares of the Company in lieu of
professional service provided.
20. CAPITAL AND RESERVES
The nature and purpose of equity and reserves are as follows:
Share capital comprises the nominal value of the ordinary issued share capital of the Company.
Share Premium represents consideration less nominal value of issued shares and costs directly attributable
to the issue of new shares.
37
SEALAND CAPITAL GALAXY LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
21.
SHARE-BASED PAYMENTS
(a)
Share Options
During the year ended 31 December 2021, the Group has implemented a stock option plan (the
“Plan”) for the employees and directors, which awards options over the ordinary share of the
Company. The Board of Directors (the “Board”) approves all grants and the terms of all grants.
Options awarded under the Plan generally vest on issue and exercisable over a period from one year
after the grant date to four years after the grant date.
The fair value of each option granted is estimated on grant date using the Black-Scholes option-
pricing model by applying the following assumptions:
Share price
Risk-free interest rate
Expected life of warrant (years)
Expected annualised volatility
Expected dividend yield
£0.0007
0.0022%
4
0.66
Nil
For the year ended 31 December 2021, the Company recorded share-based compensation expenses
in the amount of £357,417.
At 31 December 2023 and 2022, the Group had 105,122,539 share options outstanding as follows.
Date of
Grant
Exercise Expiry
start date date
Exercise Number
granted
price
19/10/2021 19/10/2021 18/10/2025
0.7p
Nil
(b) Shares issued for services
On 4 April 2022, the Company has issued 4,909,091 new ordinary shares of the Company in lieu of
professional service provided.
22. RELATED PARTY TRANSACTIONS
(a) Details of the compensation of key management personnel was disclosed in Note 10 to the financial
statements.
(b) Apart from the balances with related parties at the end of the reporting period disclosed elsewhere in
the financial statements, the Company had not entered into any significant related party transactions for
the Year.
38
SEALAND CAPITAL GALAXY LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
23.
FINANCIAL INSTRUMENTS BY CATEGORY
The totals for each category of financial instruments is as follows:
Financial assets
Financial assets at amortised cost
Trade receivables
Deposit and other receivables
Cash and cash equivalents
Financial liabilities
Liabilities at amortised cost
Trade payables
Other payables and accrued expense
Amounts due to directors
Lease liabilities
2023
£
2022
£
35,435
12,847
9,111
57,393
36,110
630,524
740,486
14,432
26,430
22,491
35,567
84,488
36,110
480,213
602,646
45,055
1,421,552
1,164,024
Prepayments are excluded from the summary above.
24. CHANGES IN LIABILITIES ARISING FROM FINANCING ACTIVITIES
At 1 January
New lease
Financing cash flows
Exchange adjustment
At 31 December
25. CAPITAL COMMITMENTS
Lease liabilities
2023
£
2022
£
45,055
-
(29,674)
(949)
14,432
14,750
59,721
(33,582)
4,166
45,055
There were no capital commitments as at the year ended 31 December 2023 (2022: Nil).
39
SEALAND CAPITAL GALAXY LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
26. DEREGISTRATION OF SUBSIDIARIES
In April 2023, the Group deregistered the subsidiaries of Taohui Limited (PRC) and Ptp Media Limited
(PRC). The principal activities of the subsidiaries are inactive.
The following summarises the carrying amount of the assets and liabilities at the date of deregistration:
Net liabilities of the deregistered subsidiaries
Prepayments and other receivables
Cash and cash equivalents
Other payables and accrued expenses
Gain on deregistration of subsidiaries
Net cash flow on deregistration of subsidiaries
Net outflow of cash and cash equivalents
£
381
1,013
(42,601)
(41,207)
41,207
-
-
(381)
27. SUBSEQUENT EVENT
On 26 January 2024, the Company has issued 9,090,909 new ordinary shares of the Company in lieu of
professional service provided. The management expects share premium of approximately £9,000 will be
generated as a result.
40