Registration number: 03936915
Supply@ME Capital plc
Annual Report and Consolidated Financial Statements
for the Year Ended 31 December 2020
Supply@ME Capital plc
Contents
Company Information
Chief Executive’s Review and Chairman's Statement
Strategic Report
Directors
Directors' Report
Remuneration Report
Corporate Governance
Independent Auditor's Report
Consolidated Statement of Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Cash Flows
Consolidated Statement of Changes in Equity
Notes to the Consolidated Financial Statements
Company Statement of Financial Position
Company Statement of Changes in Equity
Notes to the Company Financial Statements
3
4 to 8
9 to 23
24 to 25
26 to 32
33 to 36
37 to 43
44 to 48
49
50
51
52 to 53
54 to 76
77
78
79 to 85
2
Directors
Secretary
Supply@ME Capital plc
Company Information
Enrico Camerinelli
Susanne Chishti
Dominic White
Alessandro Zamboni
MSP Corporate Services Limited
27/28 Eastcastle Street
London
W1W 8DH
Company number
03936915
Registered office
Auditor
Solicitors
Bankers
Registrars
Public Relations
Accountants
Investor Relations
27/28 Eastcastle Street
London
W1W 8DH
Crowe UK LLP
55 Ludgate Hill
London
EC4M 7JW
Charles Russell Speechlys LLP
5 Fleet Place
London
EC4M 7RD
World First UK Ltd.
Bank
Millbank Tower
21-24 Millbank
London
SW1P 4QP
Neville Registrars Limited
Neville House
Southampton
SO14 2JF
Cicero/AMO
3 Pancras Square
London
N1C 4AG
Azets
45 King William Street
London
EC4R 9AN
Walbrook PR Ltd
4 Lombard Street
London
EC3V 9HD
Website
www.supplymecapital.com
3
Supply@ME Capital plc
Chief Executive’s Review and Chairman’s Statement
We are pleased to report to you on the Group’s activities in the year to 31 December 2020, and
subsequent developments to date.
These financial statements represent the Group’s first period of trading on the Main Market of the Stock
Exchange since the acquisition of Supply@ME S.r.l..
Business overview
Global landscape: a huge addressable target market
Inventory monetisation facilities can play a key role in addressing the financing needs of the broadly
defined global supply chain market. According to “The 2020 McKinsey Global Payments Report”, insights
into that market reveal:
$17 trillion, as potential market for supply-chain finance.
~80% of eligible assets that do not benefit from better working capital financing. The remaining
one-fifth of assets are often inefficiently financed.
$14 trillion, managed directly (not financed).
$ 2.5 trillion, currently addressed by seller-side finance solutions. In this regard, inventory
financing represented, in the past year, 10% of the Seller-side financial solutions, while the
receivables financing segment (including factoring, invoice discounting and receivables finance
in all its forms), remains the largest segment with an estimated 65% market share.
$ 0.5 trillion, addressed through buyer-led solutions.
$1.5 trillion as the global gap in trade finance. In this regard, the overall trade finance market can
be roughly differentiated into three segments, each with unique product dynamics:
o Documentary business, which includes traditional off-balance-sheet trade finance
instruments, such as letters of credit, international guarantees, and banks’ payment
obligations. These instruments are typically used to cover the two corporate parties
against potential transaction risks (e.g., an exporter protecting against country-related
risks of its importer’s domestic market);
o Seller-side finance, including two main financial instruments: factoring and invoice
finance. These instruments address the financing needs of corporate sellers by
advancing liquidity related to commercial transactions;
o Buyer-side finance, which is typically aimed at large buyers and their suppliers. It covers
the financing needs of suppliers originated by large buyers, like reverse factoring, where
suppliers can access third-party financing for buyer-approved invoices, as well as
dynamic discounting, where buyers pay suppliers early in exchange for discounts on the
invoice. This has traditionally been a smaller and more fragmented market (roughly $500
billion of turnover financed), but is now growing at double-digit rates, driven by increasing
interest and new offerings by players.
Seeing the wider opportunities related to the untapped supply chain finance market, the Company wants
to play a key role in this space, gaining traction from its inventory monetisation services to provide a
unique non-credit approach and covering both “in-transit” and warehoused goods.
4
Supply@ME Capital plc
Chief Executive’s Review and Chairman’s Statement
Delivering a unique alternative facility for SMEs and Large Corporates - and a new asset class for
investors
Supply@ME delivers an innovative platform (“Platform”) for inventory monetisation that enables a wide
range of manufacturing and trading customers to improve their working capital position by releasing
capital from their inventory stock. The Platform matches the working capital needs of its customers, with
capital invested through the Platform by its inventory investors (“Inventory Funders”).
Investors in Supply@ME shares gain exposure to the fee income generated by the Platform from
inventory monetisation. Inventory Funders subscribe financial instruments that are secured by inventory
portfolios.
The highlight event for Supply@ME Capital Plc (LON:SYME - the Company or SYME) in the year to 31
December 2020 was the successful acquisition, via a reverse takeover, of Supply@ME S.r.l. together
with a successful Placing and Main Market Listing on the London Stock Exchange on 23 March 2020.
These were both key milestones that will enable the Group to develop and fulfil its ambition to become a
leading platform for inventory monetisation (Supply@ME Capital plc changed its name from Abal Group
plc on 30 March 2020).
The Company’s purpose is to be the leading fintech inventory monetisation business enabling companies
to optimise their working capital cycle through the release of capital from their inventory, in a time and
price efficient way.
Its immediate strategy of creating a highly scalable global business is built on three key objectives:
delivering a unique facility, via a digitised route, attracting and on-boarding its customers (“Client
Companies”),
developing a cutting-edge
Monetisation process, and
implementing a repeatable, multi-channel funding strategy to diversify and scale-up its Inventory
Funder investor base, allowing the asset management industry to diversify its portfolio by virtue
of a real new asset class.
technology Platform that efficiently manages
the Inventory
Building the fundamentals: milestones 2020 achieved towards the key objectives
2020 saw the groundwork laid for a number of business initiatives which have either been implemented
or are close to fruition. The Company also strengthened its board and senior management team with the
appointment of a Chief Financial Officer and several highly experienced individuals to key positions.
Looking at the business plan’s strategic pillars, apart from the delay in delivering the first inventory
monetisation in 2020, most of the other work streams planned are on-track or completed. Specifically:
Client Company sourcing partnerships have been established in Italy, the UK, MENA and the US
with 14 partners to deliver an ongoing stream of monetisation demand to the Platform;
the technology Platform has been further developed and is now operational and ready to
implement the first monetisation transaction
the Company has in place a multi-channel global funding strategy:
o Middle East: Shariah structure approval
o
Italy: strategic agreement with the institutional asset manager Quadrivio Group (and its
Industry 4.0 fund) who are working on a European bank acquisition. In parallel,
establishing a Self-Funding model in order to allow other banks to promote the inventory
monetisation service to their customer base
Italy and UK: progress with the Italian and UK securitisation program managed by Storm
Harbour
o
o USA: partnership with The Trade Advisory aimed at delivering the inventory monetisation
service gaining traction from Mr Anthony Brown’s ecosystem (Funders, Client
companies, warehouse service providers etc.).
5
Supply@ME Capital plc
Chief Executive’s Review and Chairman’s Statement
Finally, talks began in 2020 with Tradeflow Capital Management Pte Ltd (“TradeFlow”), a Singaporean
complementary inventory “in-transit” fintech business. In the first half of 2021, those initial discussions
developed into a concrete acquisition transaction of their business, which was announced on 26 May
2021.
This acquisition will enable SYME’s customers to monetise an additional step of the inventory lifecycle
(inventory in-transit) through its Platform as well as provide access to TradeFlow’s’ existing Inventory
Funders. It will also potentially establish a base for inventory monetisation activity in the Singapore region
covering the “East and Far-East”: the final target geography of the SYME global Platform.
Financial overview
In summary, from a financial viewpoint, the Group has transformed successfully from a cash shell listed
on AIM, to a Group admitted to the Official List as a Main Market company, standard segment, trading on
the London Stock Exchange.
In the period to 31 December 2020 the Company raised £2,234,000 gross (2019: £Nil), £1,615,000 net
from the issue of new ordinary shares by way of a Placing.
Consolidated results
Revenues in the period* were £1,147,000 (2019: £4,000). The loss before tax and the exceptional cost
of listing (£1,376,000) described below was £2,819,000 (2019: loss £687,000).
Total loss for the year was £2,962,000 (2019: loss £551,000) and loss per share 0.01 pence (2019: 0.00)
At the year end, net liabilities were £452,000 (2019: net liabilities £557,000) and cash balances were
£552,000 (2019: £143,000).
*Included within accruals and deferred income is £1,131,000 (2019: £634,000) relating to payments in
advance made by client companies for due diligence to pre-qualify them for access to the inventory
monetisation scheme. Under Italian GAAP, these amounts are recognised in revenue in the year.
Under IFRS, these amounts will be recognised in future periods.
Further details are to be found in the Strategic Report financial review on page 9 to 23.
Change of accounting date / temporary suspension and subsequent re-instatement of trading
The Company’s shares were temporarily suspended from trading on 21 January 2021 due to a technical
breach of DTR rule 2.0 (reporting timetable). This happened because SYME had, in accordance with
company law (and following a precedent set by Aston Martin), proactively taken the decision to change
its accounting reporting date to 31 December to match that of its current subsidiaries and likely future
subsidiaries in the middle east and USA. Countries have different standard reference accounting dates
but it had become clear that the typical reporting period across the Group’s target business geographies
was the calendar year.
Therefore, on 19 January 2021, the Company changed its Accounting Reference Date from 30
September to 31 December.
This change required the Company to produce two sets of historic accounts:
- Audited accounts for the nine months to 31 December 2019, which were published on 28
January 2021
- Unaudited Interim accounts for the six months to 30 June 2020, published on 29 January 2021
Although this created additional work in the short-term, it had the immediate benefit of allowing us to
produce 2020 accounts completely segregated from the Abal business and it also became clear that in
the longer term, aligning all of the reporting dates to the calendar year would significantly streamline the
financial reporting consolidation process.
6
Supply@ME Capital plc
Chief Executive’s Review and Chairman’s Statement
Despite being compliant with company law timetables for reporting when accounting reference dates are
changed, the Company was advised that it had triggered a technical stock exchange reporting timeline
breach and the Company therefore requested the temporary suspension of its shares on 21 January
2021. The subsequent restoration process was managed directly with the FCA during February and
trading in the Company’s shares resumed on 9 March 2021.
Treatment of the Reverse Takeover (RTO)
Accounting for the RTO presented a very complex accounting challenge, and a detailed analysis is to be
found in Note 3 to the Group’s consolidated financial statements. Nevertheless, after a great deal of input
by technical teams, there was an underlying principle to represent: Supply@ME S.r.l. – the Italian
operating company – reversed into the shell of Abal Group plc (which became Supply Me Capital plc) in
order to get a public company listing. It was this action which needed to be costed; and that cost needed
to pass through the Income Statement. All other movements that had to be accounted for went directly
through specific balance sheet reserves.
Therefore Supply@ME S.r.l. became the “deemed acquirer” of Abal Group plc. The logic that was applied
to the calculation of the deemed cost of listing was relatively straightforward, once this distinction was
made: the cost was effectively that of buying a controlling interest in the shares of Abal Group plc at the
time of the transaction, adjusted by the working capital. It was made up of the following components:
Abal Group plc share price (last price before RTO suspension)
£0.0085
Shares required for acquisition of controlling interest
Cost of shares
Working capital adjustment:
Deduct
Cash and cash equivalents
Receivables
Add:
Payables
Deemed cost of listing
101,094,220
£’000
859
(93)
(50)
660
1,376
Reporting of the Company results under FRS 102
The Company results, presented from page 76 have been reported in accordance with FRS 102 (UK
GAAP). Under this reporting standard (the “FRS 102”), the results come under the relevant sections of
the Companies Act 2006 and in particular as they relate to merger relief (sections 610, 612 and 615 of
the Companies Act 2006) for corporate investments where more than 90% of the acquired entity is
represented by a share for share exchange, as occurred with the acquisition of Supply@ME S.r.l.. FRS
102 allows the investment to be carried in the Company’s balance sheet at the nominal value of the
shares issued.
Future plans and expectations
The completion of the two key initiatives – the Captive Bank (and accordingly the first Italian monetisation
transaction) combined with the TradeFlow Capital acquisition - will allow the Company to declare a real,
“up and running” Platform, representing the 3-years of positive track record of TradeFlow and nearly 7
years of investment developing the inventory monetisation business.
In addition, the work streams on UK inventory monetisation and the promotion of the Shariah version of
the Platform will boost the placing of SYME’s inventory monetisation asset class with the global asset
management industry.
7
Supply@ME Capital plc
Chief Executive’s Review and Chairman’s Statement
The Company also expects to develop a revenue stream by “white-labelling” its Platform; effectively
already conceived via the “self-funding” route and by virtue of the opportunity for institutions to use
TradeFlow’s proprietary technology for dedicated trade financing.
In parallel the Company has to work to scale up its operations and leverage its international footprint,
which now covers all the target geographies: UK, Europe, MENA, US and Far-East and in which its
technology and personnel will play a key role in this “revenue-generation” phase of SYME.
In terms of strategic positioning and global investor relationships, following the first monetisation, the
Company expects to see a “snowball” effect of penetration into a growth phase of both the demand side
and the supply side of this novel financing concept that SYME’s Platform facilitates - and from which
SYME intends to maximise shareholder value. It will seek to increase its investor base, both
geographically and with new institutions and is already evaluating opportunities to create a more global
visibility of its unique initiative through new trading venues.
Dominic White
Non-Executive Chairman
25 June 2021
Alessandro Zamboni
CEO
*************************
8
Supply@ME Capital plc
Strategic report
Introduction
The Strategic Report should be read in conjunction with the Chief Executive’s Statement and Directors’
Report which are included in these financial statements.
In January 2019, there was a change in strategy and the Group announced its intention to sell all its
business and assets, and this sale was completed in February 2019. From the date of the sale of the
business the Group became a cash shell that was seeking new investment opportunities.
These endeavours culminated successfully after the 2019 year end and on 23 March 2020 Abal Group
plc successfully raised funds through a placing, issued consideration shares to secure the acquisition of
Supply@ME S.r.l. via a reverse takeover and gained admission to the Official List as a Main Market
company, standard segment, trading on the London Stock Exchange.
Supply@ME Capital plc changed its name from Abal Group plc on 30 March 2020.
The comparative figures, and any results prior to 23 March 2020 of Supply@ME Capital plc (the sole
company) have not been presented and only the assets and liabilities of Supply@ME S.r.l, as the effective
acquirer, have been recorded in the consolidated financial statements at their pre-combination amounts.
This is further explained below.
2020 was a difficult year globally for business given the COVID-19 pandemic. However, it is the
Company’s view that demand for SYME’s inventory monetisation service has and will continue to grow.
This view is supported by the initial phases of Client company origination, which have been positive.
Since the impact of COVID-19 started to be felt, and global supply chains were dramatically affected, the
“Just In Time” (JIT) inventory standard for manufacturing and trading businesses has been reassessed
and in many cases forced to change. Many businesses are now increasingly preferring to, or having to,
build inventory levels to avoid supply chain shortages and subsequent loss of trade.
Reducing risks in the supply chain by manufacturing locally rather than thousands of miles away, and,
increasing inventory held may become the new norm.
This new landscape, and required growth in global inventories post pandemic, reinforces the Company’s
belief in the large and growing addressable international market for inventory monetisation services.
Business Model
Supply@ME (LON:SYME) is an innovative Platform for inventory monetisation that enables a wide range
of manufacturing and trading customers to improve their working capital position by releasing capital from
their inventory stock. For this purpose, SYME matches the working capital needs of its customers with
capital invested by its inventory funders.
How an inventory monetisation process works
There are 5 steps to an inventory monetisation:
1. Client company sourcing.
2. Due diligence phase: each Client company is pre-qualified by SYME’s analyst team for:
a. satisfactory credit and insurability status;
b. appropriate inventory characteristics;
c.
internal organisation and internal controls.
3.
Inventory digitalisation and monetisation: including recording every inventory movement (in/ out)
into a blockchain to prevent any data-tampering by either the Platform or third parties, and thereby
improving:
a.
b.
the transparency and consistency of reporting; and
the enforceability of the contracts.
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Supply@ME Capital plc
Strategic report
4. Monitoring: once the Client company sells the inventory to the Platform and continues to manage
the stock on its premises in order to sell to the end customer, the Platform manages several
processes aimed at monitoring:
the physical status of the inventory via site visits;
a. adherence to the KPIs (sales performance indicators) of the agreement;
b.
c. sales to end customers through the Platform;
d.
replenishing of inventory levels in parallel with rolling over of the financing facility during
the life of the contract.
5. Winding down of the agreement, alternatively:
taking action to resell inventory where commercial defaults occur;
a.
b. when final inventory is sold, to pay down the capital outstanding and no new inventory is
required to be monetised.
To provide capital for the monetisation of inventories, the Platform uses segregated (off-balance sheet)
special purpose companies (“Stock Companies”) to issue financial instruments (such as secured notes)
that will be subscribed for by institutional investors.
Group corporate structure
For each geography, SYME will establish a subsidiary to include personnel aimed at managing the five
steps described above. As at the date of this report, the Company has its main subsidiary in Italy; it has
formed a subsidiary in the UK and is processing an application to open a new subsidiary in the UAE.
The TradeFlow Capital Management Pte Ltd. (“TradeFlow”) acquisition will allow SYME to expand its
operations also in Singapore, covering the East and Far-East region.
Innovation & IP rights
The Platform’s innovation is a combination of technology (software, cloud components, blockchain
infrastructure) as well as the following components:
innovative legal & accounting framework (which allows the Client companies to recognise
revenues in relation to the inventory monetisation transaction);
proprietary methodologies aimed at analysing the inventory risk around each transaction;
a new asset class (a financial instrument in the perspective of the Inventory Funders) with
underlying marketability of the inventory monetised.
Principal activities
The Company manages its principal activities through the following main work streams:
1. Inventory funding programmes;
2. Client company originations;
3. Platform (product) development.
1. Inventory funding programme overview
The Company is developing the following routes to funding its monetisation service.
i) Open-Funding
Open-Funding is gathering financing for Inventory Monetisation through securitisation vehicles or other
third-party financing facilities.
Client Companies are sourced by Supply@ME via its commercial partners.
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Supply@ME Capital plc
Strategic report
In 2020 two Open-Funding structures were being marketed. One focused on an Italian portfolio and the
other on a more diversified international inventory portfolio.
The first Open-Funding structure is an inventory-backed securitisation note programme, arranged and
distributed by StormHarbour Securities LLP (“SH”). In this regard, on 30 October 2020, Supply@ME
announced its decision to collaborate with a single Inventory Funder (“Investor”) for the first securitisation
issuance. As announced, this investor has expressed the preference to invest in a more diversified
portfolio by country. SYME’s UK team is therefore working with the Investor to complete legal
requirements and agree terms reflecting a wider global portfolio (in particular in the UK and UAE which
both operate under English common law, a preferred jurisdiction of this Inventory Funder).
Following this revised funding strategy and taking into account the growth of the portfolio shown below,
SH is continuing to roll out its securitisation placing programme as per the RNS of 20 April 2020.
The second Open-Funding structure is a Shariah compliant investment product. This widens the
potential investor base for the inventory monetisation platform to include the Islamic Finance Industry.
Since its launch, the Shariah-compliant version of the Platform has seen strong levels of interest. SYME
continues to work with the Shariah Funding Specialist towards a Shariah compliant capital market
placement.
The latest – new - Open-Funding structure is related to the two TradeFlow Capital Funds of which
Tradeflow Capital Management Pte Ltd. is also the investment advisory company.
to enabling physical commodity
import/ export
Specifically, TradeFlow’s non-credit approach
transactions, which is unique in the trade finance hedge fund world, swaps pure credit risk faced by
investors in other trade finance funds for real-world insurable physical risks. The Funds do this by
simultaneously entering into a purchase contract for the commodity from the supplier at a fixed price (on
behalf of the end buyer) and an onward sales contract to the end buyer at a fixed price, the Funds are
not exposed to price risk per se. Only if the end buyer were to default by not paying the full value of the
cargo upon delivery could the Funds be potentially exposed to the commodity asset price falling. This
statistically low risk event is mitigated by the risk management methodology employed by the Funds,
which looks very similar to the approach used by modern day financial market clearing houses.
Looking at the track record of the funds, in May 2018 the first Trade Flow fund went live (the CEMP –
USD Capital Trade Flow fund SP) a fund which gives investors all the benefits and diversification of Trade
Finance Asset Class combined with further diversification away from private credit. The strategy offers a
superior Raroc return with a “principal” ownership and control model of the underlying physical asset.
This offers investors a low risk profile, fixed income style return, with equivalent risk of loss quantified at
“AA” S&P equivalent by an independent study done in September 2018. In February 2020, TradeFlow
launched a EURO version of the USD Trade Flow Fund. The flagship USD fund has an over 3 year track
record of consistent returns, returning +6.01% net in 2019 and +5.93% net in 2020, consistently delivering
net Average monthly returns of +50bps to investors with a Volatility of returns below 0.75%.
At the date of this report the two Funds:
managed over USD 500mm of trades;
processes over 700 transactions, concerning 25 commodity types from over 15 countries;
scored 0 defaults since inception;
doubled the Assets Under Management during the Pandemic;
manages a fully supply-chain digitised system for scalability.
ii) Captive-Funding
The Captive-Funding strategy is the gathering of financing through a strategic “captive” relationship with
a bank.
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Supply@ME Capital plc
Strategic report
In this funding channel, Client Companies are sourced by Supply@ME, via its commercial agreements,
the target Bank and potentially the wider network of Quadrivio Group and its partners.
As stated above, the original single Inventory Funder, that had initially proposed to fund a wholly Italian
portfolio, has expressed a preference to invest in a more diversified inventory portfolio across several
countries rather than in a single country. SYME has therefore agreed with its partners that, subject to the
successful completion of the Captive Bank transaction, this Captive-funding route will be used to begin
the monetisation of its Italian portfolio of Client companies. The first group of Italian Client companies that
are expected to be monetised have been informed of this solution.
iii) Self-Funding
Self-Funding is gathering financing through banks and other institutions (“Self-Funders”) that also offer
the Inventory Monetisation service directly to their customers, such that the banks and their client base
can benefit from the systems, assessment, and monitoring processes of Supply@ME's Platform.
Client companies are sourced by the Self-Funders.
The Company is continuing to work with several Banks across the jurisdictions now ready to be activated
(Italy, UK, UAE) in order to design an integrated service model, whilst taking into account the upcoming
key role of the Captive Bank as the “cornerstone” Inventory funder.
This funding route is, as well, enhanced by TradeFlow’s business. In this regard, on the 30th March 2021,
the ICC Secretary General John W.H. Denton AO announced an ambitious partnership with TradeFlow
Capital Management during the World Trade Organization’s 2021 Global Trade & Blockchain Forum, as
part of ICC’s growing effort to enable SME access to short-term liquidity to survive the ongoing economic
crisis and thrive in the post-pandemic future. Leveraging TradeFlow Capital Management’s innovative
non-lending and non-credit based instruments and ICC’s global network of over 45 million chambers of
commerce and businesses, the partnership will enable the creation of an ICC SME Fund to provide small
businesses with the right level of financial support to execute import/export trades in bulk commodities.
By leveraging the combined strengths of ICC and TradeFlow, ICC TradeFlow Capital has the potential to
enable many billions of dollars of SME commodity transactions each year.
2. Client Company origination
Overview
The portfolio of Client Companies continues to grow. Gross origination of Client companies (the KPI that
tracks demand for inventory monetisation) increased 15.6% between December 2020 and the end of April
2021 to £2.116 bn (€2.461bn @ £1=€1.1628)
Value (GBP)
31.3.20
30.6.20
30.9.20
31.12.20
30.4.21
Gross origination1
1.05bn
1.23bn
1.41bn
1.83bn
2.116bn
Number of client companies
82
97
142
165
194
1 “Gross origination” includes the estimated value of inventory to be monetised by all client companies
that have signed an NDA, a term sheet, or are in, or have completed, the onboarding process. For clarity,
the gross origination also includes commercial opportunities postponed or lost/ not eligible.
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Supply@ME Capital plc
Strategic report
According to the Global Industry Classification Standards (GICS) classification adopted by the Company,
the key Portfolio core sectors are currently Materials, Capital Goods, Retailing & Food and Beverage &
Tobacco. Below is a breakdown of the Client company origination with reference to the geographical
region served.
Client company Geographical breakdown 30.4.21
A geographical breakdown of SYME’s client company portfolio is given below.
Value (GBP)
UK
Europe
MENA
(Italy)
Other
geographies
Totals
Gross origination
260.5m
175.2m
1.551bn
129m
£ 2.116bn
Number of client companies
23
12
158
1
194
Within the US region, the acquisition of Tradeflow will give the Company the opportunity to deliver an
innovative “inventory in transit" monetisation model for US importers, whilst also gaining traction from The
Trade Advisory network.
Client company net originations 30.4.21
The following table shows net originations, classified by the different phases of the commercial and due
diligence process of the Platform.
In total, 72 Client companies were lost, either before or after signing the term-sheet. Of those, 20 (28%)
either failed to meet creditworthiness criteria or had other negative due diligence results that rendered
them ineligible. A further 20 (28%) who dropped out because of the delays in obtaining securitisation
funding are expected to come back on board once the first securitisation has been completed.
Net Retention
Net origination retention totals £1.555 bn (€ 1.809bn @ £1= €1.1628), split as follows:
Value (GBP)
UK
MENA
Europe
(Italy)
Other
geographies
Pre-analysis/ NDA
260.5m
175.2m
838.3m
129m
Number of Companies
23
Term sheet signed
Number of Companies
-
-
12
-
-
72
152.3m
14
1
-
-
Totals
£1.4bn
108
£152.3m
14
Lost customers: 72
Expect to
return
20
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Supply@ME Capital plc
Strategic report
Value (GBP)
UK
MENA
Europe
(Italy)
Other
geographies
Lost before term sheet
signed
Number of Companies
Lost after the term
sheet signed
Number of Companies
-
-
-
-
In terms of originations lost:
-
-
-
-
336.1m
51
225m
21
-
-
-
-
Totals
£336.1m
51
£225m
21
24% of the Client companies lost before signing a term sheet (12) were deemed “not-eligible”;
38% of the Client companies lost after signing a term sheet (8) were deemed “not-eligible”;
the Company expects to regain 28% of the initiatives lost (20) after the completion of the first
inventory monetisation transaction.
3. Platform (product) development
Production management
The system architecture of the Platform is made of several components, mostly of them managed in
partnership with SIA:
software modules focussed on the management of inventory trading and monitoring activities;
productivity tools aimed at sharing information (data and documents) via cloud technology;
database infrastructure aimed at storing data, incorporating the use of blockchain technology.
The Company considers its partnership with SIA (https://www.sia.eu/en) as a strategic asset, particularly
considering the recent merger between SIA and NEXI that will create a €15 billion payment giant and the
largest blockchain service provider in Europe (source: fintechfutures.com).
In addition, by virtue of the acquisition of TradeFlow, SYME will update the general system architecture
of the Platform to be able to map potential (existing and near term) synergies between the mutual
systems.
Intellectual Property
The Company continues to evaluate further forms of intellectual property protection, in particular relating
to its innovative true-sales model and related legal contract framework.
Internet-of-things
The Company, as outlined in its business plan, is exploring potential joint business alliances with Internet-
of-things vendors such that it can begin to develop a unique “Internet of Inventory” tracking and monitoring
product to enhance its offer. In this regard, the acquisition of TradeFlow could boost this work stream.
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Major events during the period
Prior to the reverse acquisition and Main Market Listing, the Company (formerly Abal Group Plc) traded
on London’s Alternative Investment Market (AIM). Pursuant to AIM Rule 15, the Company became a
cash shell on 5 February 2019 following the completion of the disposal of its core operating business
(known as Imaginatik), and trading in the Company's shares was subsequently suspended on 6 August
2019.
On 27 September 2019 the Company announced that it had entered into a conditional sale and purchase
agreement to acquire the entire issued share capital of Supply@ME S.r.l. Cancellation of the admission
to trading of the Company's ordinary shares on AIM took effect on 7 February 2020, in accordance with
AIM Rule 41.
On 23 March 2020, Abal Group plc completed the following transactions:
reverse acquisition of Supply@ME S.r.l., a company registered in Italy;
placing of 331,604,094 shares raising gross proceeds of £2,240,317; and
admission to the Official List and trading on the London Stock Exchange's Main Market.
The transaction was effected by way of the issue of 32,322,246,220 consideration shares to the
shareholders of Supply@ME S.r.l. The market capitalisation of the Company on Admission at the Issue
Price per share under the Listing Prospectus was £227,482,090.
Following the reverse takeover and the commencement of dealings on 23 March 2020, the Company
achieved these important milestones during the period:
10 August 2020: UAE business expansion - MOU signed with Imass Investments, a leading
Middle East Investment Company, for the first Supply@ME pilot in the region. This represents
the start of a planned rollout of the Inventory Monetisation platform in the Middle East;
4 September 2020: business alliance signed with EPIC SIM (now Azimut Direct), a leading SME
Italian fintech marketplace. The alliance between Supply@ME and Epic creates a new sales
channel for the Company, including client company origination, sourced as companies come to
the Epic fintech platform, and inventory funding;
21 September 2020: strategic agreement signed with Quadrivio Group (a leading European
private equity fund) and the 1AF2 S.r.l. (now the AvantGarde Group SpA – major shareholder of
the Company) in order to develop a funding agreement between SYME and a target European
bank (“Captive Bank”) which Quadrivio Group and the AvantGarde Group committed to purchase.
This strategic agreement allows the Company to deploy a new funding route (“Captive Funding”);
22 October 2020: Strategic agreement signed with Mr. Anthony Brown and The Trade Advisory
to launch the Supply@ME’s platform in the USA. The Trade Advisory specialises in US
international trade and finance, introducing global and local lenders and investment funds to
businesses looking to expand their cross-border activities. It has helped its clients to launch new
trade finance products generating significant additional trade finance revenues;
30 October 2020: exclusivity basis agreement decided in order to complete the placing process
(managed by StormHarbour Securities LLP) of the first securitisation issuance. The Company
announced on 10 September 2020 that it was analysing whether to syndicate its first
securitisation note across a number of investors, or work on an exclusive basis with one
investment fund. Following detailed evaluation, SYME confirmed that it has agreed to partner on
an exclusive basis with a global investment fund (the “Investor”) whose intention is to subscribe
for the whole of the first issuance and become a long-term strategic partner of the Company.
Whilst this decision had put back slightly the date of completion of the first issuance, the
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Strategic report
opportunity to form a strategic partnership with the Investor would provide invaluable benefits to
SYME, both short and long-term.
Financial review
We report here the results of the SYME Group, which incorporate the consolidated activities and financial
position of Supply@ME S.r.l. for the full year, and those of Supply@ME Capital Plc from the date of the
reverse takeover (RTO); that is to say, 23 March 2020. The comparatives for the prior year (2019) refer
exclusively to the results of Supply@ME S.r.l.
Revenues in the year were £1.15 million (2019: £0.00 million) and were predominantly earned by charges
for due diligence conducted on potential clients. Gross profits after direct costs of sales were £0.41 million
(2019: gross loss £0.76 million). Other administrative costs were £1.90 million (2019: £0.10 million). Not
included in revenues in the period under IFRS accounting are £1.13 million (2019: £0.63 million) of
advanced payments by customers that will be recognised as revenue in future periods.
The consolidated loss before taxes and exceptional costs associated with the RTO was £1.44 million
(2019: loss £0.69 million). The exceptional cost, the “deemed cost of listing”, explained in the Chief
Executive’s Review and Chairman’s Statement above and in Note 3 to the Group consolidated financial
statements below, was £1.38 million (2019: nil). The total loss after tax for the year was £2.96 million
(2019: loss £0.55 million) and the loss per share was 0.01 pence (2019: 0.00).
Total assets of £3.33 million (2019: £1.45 million) include Intangible Assets, being the capitalised
development costs of the Platform, net of amortisation, of £1.24 million (2019: £0.39 million), and cash
balances of £0.55 million (2019: £0.14 million). Net liabilities were £0.45 million (2019: £0.56 million).
At the period end, two warrants were outstanding and have been included in the Balance Sheet liabilities
at a combined valuation of £24,000 (2019: n/a).
Key Performance Indicators:
As stated in the Prospectus, the Directors and the Proposed Directors have set a business strategy to
achieve the following goals.
The tables below track the progress made for each strategic action as 30 April 2021.
#1 Aiming to be the best fintech inventory data monitoring business
ID Strategic actions
1.1 Banking account
integrated
KPIs used for
measurement
Delivery completed
compliant to software
quality standards
Milestone
KPIs results
Q1 2021
Delayed
Captive Bank funding
agreement will allow to
complete the stream creating
a strong monitoring process
1.2 Due
diligence/onboarding
digitization (trusted,
online simulators,
external partnership
signed rating integration)
External providers
partnership signed
Q2 2021
On track
Proprietary model re
unsold risk
16
SIA partnership allows
SYME to develop an end to
end information system with
distributed ledger technology
Preliminary agreement with
inventory specialists (Gordon
Brothers and SIA Group) in
order to support the due
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Strategic report
ID Strategic actions
KPIs used for
measurement
Delivery completed
compliant to software
quality standards
1.3 ERP fully integrated
(firstly SAP, IBM, Oracle
Q2 2021 (SAP) ERP
vendors and Microsoft)
ERP vendors
partnership signed
Numbers of ERP
integrated
1.4
Internet of Things (smart
cameras, RFID)
integration for inventory
off-site monitoring
1.5 Remarketing digital
workplace (e-
marketplace where
remarketer can monitor
and place signed
Inventory purchase
offers)
Delivery completed
compliant to software
quality standards
IoT vendors partnership
signed
Delivery completed
compliant to software
quality standards
Remarketing
partnership signed
Delivery completed
compliant to software
quality standards
Milestone
KPIs results
diligence and monitoring
phases
Further project on track with
a Big4 firm in order to
develop an inventory unsold
value at risk (statistical
proprietary model)
On track
APIs/ Data factory
framework is under design in
order to allow each Client
company to automated the
upload processes into the
Platform
Q2 2021
(SAP)
Q2 2022
(other
ERP)
Q4 2021
On track
Identified potential US
partners
Q1 2022
On track
Preliminary agreement with
inventory specialists (Gordon
Brothers and SIA Group) in
order to support the
inventory liquidation phase
Further discussions in place
with specialised Auctions
#2 Developing a multi-channel funding strategy
ID Strategic actions
KPIs
used
measurement
for
Milestone
KPIs results
2.1 Companies – omni-
customer strategy (edu-
marketing initiatives,
ERP’s vendors
partnership, social
activities, web/online
simulators development)
Number of new Client
companies
originated
yearly
Q2 2021
Over-achieved
(101
companies
by the end
March 21)
194 new Client companies
originated by virtue of the
following origination
agreements:
1. Italy market (EPIC SIM –
now Azimut Direct, over 10
local intermediaries)
2. UK Market (Parzival
Partners, Altimapa)
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Strategic report
ID Strategic actions
KPIs
used
measurement
for
Milestone
KPIs results
2.2 Funders – diversifying
the sources
(securitisation notes
continuous road shows,
commercial banks of
funding originated
partnerships, partnership
with digital platforms
(e.g. CrossLend)
3. MENA: iMASS
Investments
4. US: the TradeAdvisory
Number of new sources
of funding originated
Q3 2021
Delayed
Amount of funding
originated per new
source
ITALY
Captive Bank and 3 potential
inventory funders
UK & UK common law
3 potential inventory funders
UAE
1 potential inventory funder
(Shariah funding specialist)
US
2 potential inventory funders
#3 Creating a highly scalable global business
ID Strategic actions
KPIs
used
measurement
for
Milestone
KPIs results
3.1 Operations:
enhancement of new
level of “Group” internal
governance functions
directly into PLC (e.g.
ICT Compliance, Risk
Management).
3.2 Legal framework: roll out
of the current legal
framework (ready for
Italian market) in order to
serve new geographies
State of work (% of
yearly
re
progress)
recruiting plan
of
new
Number
subsidiaries
(and
incorporated
effective) compared to
business projections
Q1 2020
Completed
Appointments of:
Head of Risk Management
Head of Business
Operations
Over-achieved
Business opened over the
following regions
MENA, UK, US
2020
Q3
(first
geography)
Principal Risks and uncertainties
The following risks are considered by the Board to be the most significant risks to the business:
Funding Risk
The Company is not currently sustainably profitable. Despite strong confidence in its business plan and
forecasts, the Directors recognise there is a risk that it may require more funding but not be able to find
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Strategic report
agreement with a funding partner. The Directors have sought to mitigate this risk by identifying a number
of options for funding, including both equity and debt and, as stated recently, the TradeFlow’ acquisition.
Employee Risk
Failure to retain key executives could adversely affect the Group's operating and financial performance.
Retaining and motivating key executives is a critical component of the future success of the business.
The loss of the services of any of the key management personnel will adversely affect the Group's ability
to maintain or improve its operating and financial performance and as a result, the Group is actively
recruiting further key personnel in other geographies to make it more robust.
Strategic risk (competition)
The Company’s business model is that of an innovative Platform for inventory monetisation, aiming to
capitalise upon market developments where supply chains may be placed under pressure, leading
suppliers to hold increased amounts of inventory in order to supply both on and offline retailers, with a
resultant restriction on available working capital.
The Directors are unaware of other entities offering a similar Platform, but are aware that future
competitors could offer superior scale and put pressure on prices which could affect the Group’s forecast
revenues and profit margins.
Global Economic risk
The Company’s business is substantially becoming global. Accordingly, the Company is exposed to the
general economic impacts of COVID-19, and would also expect to be so in 2021, albeit the current
concern about supply chains having become too long and uncertain does provide an opportunity for the
company. Further, with the United Kingdom having left the European Union in January 2020, and with
the end of the subsequent transition period set out in the UK-EU Withdrawal Agreement, the general
weakness of both economies may negatively affect the financial conditions of the Group. The Directors
recognise the risk and are working to analysis the outlook of each market which the Platform is operating.
Financial Risk Management
The Board monitors the internal risk management function across the Group and advises on all relevant
risk issues. There is regular communication with internal departments, external advisors and regulators.
The Group's policies on financial instruments and the risks pertaining to those instruments are set out in
the accounting policies in notes 1 and 22 of the Group consolidated financial statements.
Future development and strategy
As stated recently by the Company, the additional time invested in addressing the request of the single
Inventory Funder to invest in a more diversified portfolio (by country) of inventory assets and the
subsequent refocus of the Captive-funding route on wholly Italian portfolios, inspired SYME to study a
more efficient funding structure, also leveraging TradeFlow’s experience in structuring and advising
hedge funds. The objective is to use the new funding structure for the first monetisation transactions.
The new funding structure will envisage a global umbrella fund which establishes special purpose vehicles
(“stock companies”) in each operating geography. This investment structure:
may integrate also the existing TradeFlow Funds;
allows SYME to promote two investment opportunities to the market (an equity stake at the level
of the umbrella fund and debt notes at the level of each stock company), expecting an increase
of the funding capacity of the Platform.
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As well as completing the first inventory monetisation transactions, the Group expects to resume the Self-
Funding route in partnership with the Captive Bank, after the completion of the authorisation process.
The international addressable market for inventory funding has been confirmed as very large, and will be
further boosted by the trade finance market opportunities in which the Company will compete using the
unique non-credit approach of TradeFlow.
Once the first inventory monetisation is launched, SYME and its Inventory (“on premises” & “in transit”)
Monetisation Platform will be instantly established as the leading fintech operator in the sector.
Going concern
The board's assessment of going concern and the key considerations thereto are set out in the Directors’
Report in the financial statements.
Capital structure
Details of the ordinary shares of the Company are shown in note 15 to the Group consolidated financial
statements.
The Company has a class of ordinary shares of £0.00002 per share and two classes of deferred shares
of £0.04 per share and £0.01 per share respectively, both of which carry no fixed income.
Neither class of deferred shares is admitted to the Official List on either the London Stock Exchange or
any other exchange.
At the year end, certain warrants to acquire shares issued to Eight Capital Partners Plc were still
outstanding, as described in note 16 to the Group consolidated financial statements.
Each holder of ordinary shares is entitled to receive the Group’s Annual Report and audited financial
statements, to attend and speak or appoint proxies and to exercise voting rights at the general meetings
of the Company. The Company’s Articles of Association (the ‘Articles’) do not have any specific
restrictions on the transfer of shares, restrictions on voting rights nor are there limitations on the holding
of such shares. The Board are not aware of any agreement between holders of the Company’s shares
that may result in restrictions on the transfer of securities or on voting rights. No person has any special
rights of control over the Company’s share capital and all issued shares are fully paid. The appointment
and replacement of directors and the powers of the directors are governed by the Articles, the Companies
Act 2006 and related legislation. The powers of the directors are described in the Corporate Governance
Report on pages 37 to 43 of the Accounts.
Corporate responsibility
The Company is committed to conducting itself in a responsible manner, whether in relations with its
employees or its external counterparts.
The Company aims for an internal culture of respect and collaboration, to both support and challenge
employee growth potential. The Company promotes a culture whereby employees are encouraged to
propose ideas, considered in a respectful and constructive manner. All employees are provided with
structured training to reinforce the highest values of ethical and moral behaviour. In relation to dealings
with external counterparts, the Company seeks to maintain respectful and productive engagements with
each counterpart, regardless of size and nature of the business.
Thus the Directors believe that the Company conducts itself in adherence with the pillars of Corporate
Social Responsibility, such culture allowing it to operate ethically and within legal obligations so as to
support financial growth.
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Strategic report
Greenhouse Gas Emissions and Streamlined Energy and Carbon Reporting (SECR)
The Companies Act 2006 (Strategic Report and Directors’ Report) Regulations 2013 require quoted
companies to report their annual emissions and an intensity ratio in their Directors’ Report. There is a de
minimis exception for organisations consuming less than 40MW of energy per year in the UK.
The Directors have reviewed the energy consumption used by the Group and consider the Group to be
exempt from reporting under the regulations as the Group is a low energy user.
As a consequence, the Directors have taken advantage of this exemption and have not therefore included
an energy and carbon report.
As far as the Directors are aware the Group’s current business activities (an innovative technology
platform for inventory monetisation) do not cause more than a negligible amount of emissions.
Environmental issues
As far as the directors are aware the Group’s business activities do not cause a direct and
disproportionate adverse effect on the environment. On the contrary, one of the perceived side-effects of
its activities is to shorten its Clients’ supply chains, which should in principle reduce transportation within
the supply chain equation and bring a positive effect to the environment.
The Board commits to keeping this under review as the Group’s business model establishes itself. Any
change in such assessment will be presented to the Directors for consideration as appropriate.
Employee matters
The Group’s policy is to attract staff and motivate employees by offering competitive terms of employment.
The Group provides equal opportunities to all employees and prospective employees including those who
are disabled and operates in compliance with all relevant national legislation.
The current business model is dependent on the current employees’ skills and the Directors will use all
reasonable endeavours to not only ensure these skills are maintained and enhanced, but also keep the
employees safe, incentivised and motivated.
Diversity and equality
The Board recognises the importance of diversity, both in its membership, and in the Group’s employees.
It has a clear policy to promote diversity across the business. The Board considers that quotas are not
appropriate in determining its composition and has therefore chosen not to set targets. All aspects of
diversity, including but not limited to gender, are considered at every level of recruitment. Gender diversity
of the Board and the Group is set out below.
Directors, employees and gender representation
As at 31 December 2020 the Group had 14 full time equivalent staff of whom 8 were male and 6 female.
There were 3 male and 1 female Directors of the Board and in addition there was 1 male staff in a senior
management position.
Social, community and human rights issues
The Group seeks to achieve the highest ethical standards and behaviours in conducting its business, with
integrity, openness, diversity and inclusiveness being high priority from the Board to senior management
and throughout the workforce. We have adopted a formal equal opportunities policy which is contained
in our employee handbook. The aim of the policy is to ensure no job applicant, employee or worker is
discriminated against either directly or indirectly on the grounds of race, sex, disability, sexual orientation,
gender reassignment; marriage or civil partnership; pregnancy or maternity; religion or belief or age.
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Supply@ME Capital plc
Strategic report
Directors’ statement under section 172 (1) of the Companies Act 2006
Section 172 of the Companies Act 2006 requires Directors to take into consideration the interests of
stakeholders and other matters in their decision making.
The Directors continue to have regard to the interests of the Group’s employees and other stakeholders,
the impact of its activities on the community, the environment and the Group’s reputation for good
business conduct, when making decisions.
In this context, acting in good faith and fairly, the Directors consider what is most likely to promote the
success of the Group for its members in the long term. We explain in the Corporate Governance section
of this annual report how the Board engages with stakeholders.
The Directors are fully aware of their responsibilities to promote the success of the Group in accordance
with section 172 of the Companies Act 2006.
At this time, the Board believes that it is compliant with all ten Principles of the QCA Code. More
information can be found on pages 37 to 43.
The key Board decisions made in the year are set out below:
Significant
events/decisions
RTO, listing, placing
Key s172
matter(s)
affected
s172 (1) a, b,
c & e
Changed Year End
s172 (1) a & e
Actions and impact
In January 2019, there was a change in strategy and the
Group announced its intention to sell all its business and
assets, and
in February
this sale was completed
2019.From the date of the sale of the business the Group
became a cash shell that was seeking new investment
opportunities.
These endeavours culminated successfully after the 2019
year end and on 23 March 2020 Abal Group plc
successfully raised funds through a £2,240,317 placing,
issued 331,604,094 consideration shares to secure the
acquisition of Supply@ME S.r.l. via a reverse takeover
and gained admission to the Official List as a Main Market
company, standard segment, trading on the London Stock
Exchange.
Supply@ME Capital plc changed its name from Abal
Group plc on 30 March 2020.
In the fourth quarter of 2020, the Board decided to
change its accounting reference date to 31 December in
order to streamline and future-proof its financial reporting
processes. This resulted in having to insert a set of
audited statutory financial reports for the 9 months to 31
December 2019. These were issued in January 2021 –
the lateness of which incurred a temporary suspension of
the Company’s shares, lifted on 9 March 2021.
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Supply@ME Capital plc
Strategic report
Significant
events/decisions
Chief Financial Officer
recruiting
Key s172
matter(s)
affected
s172 (1) a
Actions and impact
The Company’s Nomination Committee recommended
the appointment of a Chief Financial Officer. This was
achieved post year-end.
Approved by the Board and signed on its behalf by
Alessandro Zamboni
Director
25 June 2021
*************************
23
Supply@ME Capital plc
Directors
The current board comprises four directors, whose details are set out below:
EXECUTIVE DIRECTORS
Alessandro Zamboni – appointed 23 March 2020
Mr Zamboni is a director who specializes in the financial services industry and related strategic and digital
operating models.
Since 2008, he has been managing the delivery and the sales operations of a consulting company
specialising in Regulatory & Internal Controls for Banks and Insurance Firms.
Mr Zamboni founded The AvantGarde Group, the former parent company of Supply@ME S.r.l., in 2014.
NON-EXECUTIVE DIRECTORS
Dominic White – (Non-Executive Chairman) appointed 23 March 2020
Chair of Audit Committee
Mr White has invested in public markets and private equity for 25 years. He has acquired and managed more
than £3 billion of assets across Europe and held board positions at a number of public companies including
KCR Residential, REIT Plc, Eight Capital Partners Plc and Limitless Earth Plc, as well as at international
investment institutions such as Security Capital European and Henderson Global Investors.
He is a member of the Institute of Chartered Financial Analysts.
Susanne Chishti – appointed 23 March 2020
Chair of Remuneration and Nominations Committee and Senior Independent Director
Ms Chishti brings over 20 years of financial expertise and board-level experience focused on organisational
governance, and a strong understanding of the small/medium size enterprise market. Her experience draws on
14 years in banking with senior positions at Morgan Stanley, Lloyd’s Banking Group and Deutsche Bank.
As CEO of FINTECH Circle she is an award winning entrepreneur and global expert in financial technology, new
business models and a bestselling Editor of The FINTECH Book Series published by Wiley.
Enrico Camerinelli – appointed 23 March 2020
Mr. Camerinelli is a Supply Chain specialist. He takes part in projects launched by the United Nations
Economic Commission for Europe, the World Bank, the World Trade Board, and the Council of Supply
Chain Management Professionals relating to Supply Chain finance and research.
He regularly attends major industry events as an invited guest speaker.
Other directors in the year
Simon Charles (Non-Executive Director) – resigned 23 March 2020
Former Chair of Audit Committee and Remuneration Committee
Mr Charles is joint senior equity partner at the City of London firm of solicitors Marriott Harrison LLP,
having joined the firm in March 2004. He is a qualified solicitor in England and Wales and has substantial
experience advising private and public companies and investors in both a corporate and legal capacity.
Mr. Charles had worked closely with the Company for a number of years. Prior to joining Marriott Harrison
LLP, Mr. Charles worked in the corporate finance department at Numis Securities Limited, where he
advised both AIM quoted and Main Market companies as a nominated advisor and sponsor.
John Treacy (Non-Executive Director) – resigned 23 March 2020
Mr Treacy is a London based experienced small cap financier who specialises in working with growing
companies. He qualified as a solicitor in the London office of a major international law firm where he
24
Supply@ME Capital plc
Directors
specialised in Capital Markets and Merger & Acquisitions. From there he moved to practice corporate
finance in the advisory teams of several prominent UK brokerages where he acted as an adviser to a
number of AIM companies and advised on numerous IPOs, acquisitions, debt restructurings and placings.
Board committees
The Board maintains three sub-committees:
The Audit Committee, responsible, amongst other things, for making recommendations to the
Board on the appointment of auditors and the audit fee, monitoring and reviewing the integrity of
the Company’s financial statements and any formal announcements on the Company’s financial
performance as well as reports from the Company’s auditors on those financial statements. In
addition, the Audit Committee reviews the Company’s internal financial control and risk
management systems to assist the Board in fulfilling its responsibilities relating to the
effectiveness of those systems, including an evaluation of the capabilities of such systems in light
of the expected requirements for any specific acquisition target. The Audit Committee meets at
least twice a year, or more frequently if required, and is chaired by the Chairman of the Board
with Susanne Chishti, a Non-Executive Director as a further member.
The Remuneration Committee, which assists the Board in determining its responsibilities in
relation to remuneration, including making recommendations to the Board on the policy on
executive remuneration,
the over-arching principles, parameters and
governance framework of the Company’s remuneration policy and determining the individual
remuneration and benefits package of each of the executive Directors. The Remuneration
Committee also ensures compliance with the Corporate Governance Code in relation to
remuneration wherever possible. The Remuneration Committee meets not less than twice each
year, and is and comprised of two Non-Executive Directors: Susanne Chishti (Chair) and Enrico
Camerinelli.
including setting
The Nominations Committee, responsible, amongst other things, for reviewing the structure, size
and composition of the Board and ensuring that it is comprised of the right balance of skills,
knowledge and experience, identifying and nominating for approval candidates to fill any
vacancies on the Board as and when they arise, giving full consideration to succession planning
for the Company and making recommendations as to the composition of the other committees of
the Board. The Corporate Governance Code recommends that a majority of the members of a
nomination committee should be independent non-executive directors. The Company’s
Nomination Committee meets this requirement and meets not less than twice a year and is
chaired by Susanne Chishti; the other Non-Executive Director being Enrico Camerinelli.
In the financial reporting period to 31 December 2019 as the Group was non-trading, the board did not
establish an audit committee nor a remuneration committee.
Attendance at Board and Committee meetings 2020
Meetings attended / held:
Alessandro Zamboni
Dominic White
Enrico Camerinelli
Susanne Chishti
Simon Charles
John Treacy
Board
Nominations
committee
Audit committee
Remuneration
committee
8/8
8/8
8/8
7/8
0/0
0/0
1/1
1/1
1/1
1/1
0/0
0/0
1/1
1/1
1/1
1/1
0/0
0/0
1/1
1/1
1/1
1/1
0/0
0/0
*************************
25
Supply@ME Capital plc
Directors’ Report
The Directors present their report together with the audited consolidated financial statements for the year
ended 31 December 2020. A comprehensive review and assessment of the Group’s activities during the
year as well as its position at the year end and prospects for the forthcoming year are included in the
Chairman and Chief Executive’s Statement and the Strategic Report. These reports can be found on
pages 4 to 23 and should be read in conjunction with this report.
Results and dividends
The consolidated statement of comprehensive income is set out on page 48 and shows the results for
the year. Details about the reverse acquisition completed in the year are disclosed in note 3 to the Group
consolidated financial statements.
The loss before tax for the year was £2,819,000 (2019: loss £687,000).
The directors do not recommend the payment of a dividend.
Directors of the Group
The Directors, who held office during the period, and subsequently, together with current Directors are as
follows:
Mr Enrico Camerinelli – Non-Executive (appointed 23 March 2020)
Mrs Susanne Chishti - Non-Executive (appointed 23 March 2020)
Mr Dominic White - Non-Executive Chairman (appointed 23 March 2020)
Mr Alessandro Zamboni – Chief Executive (appointed 23 March 2020)
Mr Simon Charles (resigned 23 March 2020)
Mr John Treacy (resigned 23 March 2020)
Details of the Directors are set out on page 24 to 25.
Matters covered in the Strategic Report
A review of the business, future developments, subsequent events and principal risks and uncertainties
are disclosed in the Strategic Report.
Corporate governance statement
The Corporate Governance Report on pages 37 to 43 forms part of the Directors’ Report.
Directors’ and officers’ liability insurance
During the year the Company had, as permitted by s234 and 235 of the Companies Act 2006, maintained
insurance cover on behalf of the Directors and Company Secretary indemnifying them against certain
liabilities which may be incurred by them in relation to the Company.
Financial Instruments
Note 22 to the Group consolidated financial statements sets out the risks in respect of financial
instruments. The board reviews and agrees policies, delegating appropriate authority for applying these
policies to the Chief Executive and Chief Financial Officer. Financial instruments are used to manage the
financial risks facing the Group and speculative transactions are prohibited. Treasury operations are
reported at each board meeting and are subject to weekly internal reporting.
IFRS
The Directors have prepared the Group consolidated financial statements in accordance with
International Accounting Standards in conformity with the requirements of the Companies Act 2006 and
26
Supply@ME Capital plc
Directors’ Report
International Financial Reporting Standards adopted pursuant to Regulation (EC) No 1606/2002 as it
applies in the European Union (“adopted IFRS”) and with those parts of the Companies Act 2006
applicable to companies preparing their accounts under adopted IFRS.
Political and charitable donations
No political or charitable donations were made during the period.
Directors' interests
The directors who held office during the year and their interests in the ordinary shares of the Company
were as follows:
Dominic White (held through IWEP Ltd)
Alessandro Zamboni (held through AvantGarde Group
SpA)
Enrico Camerinelli
Susanne Chishti
Simon Charles (resigned 23 March 2020)
John Treacy (resigned 23 March 2020)
At 31 December
2020
At 31 December
2019
Ordinary shares
Ordinary shares
970,723,449
12,742,513,009
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
315,371
Nil
Going concern
For the reasons set out below, the Directors consider that it is appropriate to adopt the going concern
basis in preparing these financial statements.
At the year-end the Group had cash balances of £552,000 (2019: £143,000) and net current liabilities of
£1,332,000 (2019: net current liabilities £748,000). The Group has posted a loss for the year after tax of
£2,964,000 (2019: loss £554,000) and retained losses were £3,706,000 (2019: losses £705,000).
The net current liabilities as at the year end of £1,332,000 included current liabilities of £1,131,000 in
relation to down-payments made by clients with respect to due diligence services provided. The loss after
tax of £2,964,000 was after charging an exceptional, non-cash cost of £1,376,000 relating to the Reverse
Takeover referred to in note 3 to the Group consolidated financial statements and a £145,000 tax charge
which is expected to be substantially reduced by research and development credits for which the Group
is applying.
During the year, the Group was successfully admitted to trading as a Main Market company, standard
segment, trading on the London Stock Exchange having also issued placing shares with gross proceeds
of £2,240,000 (net proceeds of £1,615,000 after deducting all costs in respect of the placing and reverse
takeover).
The Directors have reviewed the forecast cashflows for the next 12 months and consider the Group to be
a going concern.
The cashflow forecasts are based on the enlarged group, following the Reverse Takeover in March 2020
and therefore relate to cashflows arising from the Group’s Fin Tech platform that focusses on inventory
27
Supply@ME Capital plc
Directors’ Report
monetisation facilities. The Directors have prepared the forecast using their best estimates; however, the
company is in its start-up phase and therefore they have identified the following uncertainty in the model.
The ability of the Group to acquire inventory is reliant on investment funding for securitisation being
received, and whilst the Group is in very advanced negotiations with several interested partners, no
securitisation investment had been finalised as at the date of this report. If no, or limited investment is
secured during the next 12 months, the Group cannot acquire inventory as assumed in the model and
generate the service fee income.
In addition the group has a portfolio of interested customers, with some having signed term sheets. The
cashflow model assumes a growth in customer base in line with the interest that has been received in the
product but there is uncertainty over the ability of the group to be able to secure these new customers.
On the basis of the above matters the directors have a material uncertainty in relation to its going concern
status. In mitigation, however, a corporate funding organisation has made sufficient funds available to
stimulate the growth of the Group and accommodate any delays in revenue generation. Therefore, given
the significant interest from a growing secured customer base, as described elsewhere in this report and
the advanced nature of securitisation funding negotiations, the Directors consider it appropriate to prepare
the financial statements on a going concern basis.
Impact of the global pandemic
As noted previously in numerous announcements, the Board has monitored closely the impact of COVID-
19 on business operations.
Impact on Client companies
SYME's Client company customer base remains strong and the demand for inventory monetisation
continues to grow. The number of Client companies being originated by SYME has grown each quarter
since the Reverse Take Over in March 2020. Increasingly, following COVID-19, many businesses are
consciously choosing to build inventory to avoid supply chain shortages and subsequent loss of trade,
rather than keep stock levels low. This is positive development for SYME's business model as it expects
that Client companies internationally will look to monetise these higher volumes of stock held.
Impact on Inventory funders
The impact of COVID-19 on Inventory funders, that is the investors through the SYME Platform into the
inventory portfolios, has been more difficult to interpret.
Interest rates are at historic lows which means that investors are getting lower returns on capital
compared to previous years when higher interest rates were the norm. SYME's new inventory asset
class will offer a strong relative margin compared to interest rates on a risk adjusted basis. However,
investors are undoubtedly more cautious and taking longer to make decisions. Time to close
transactions, not only in Inventory funding, but across the investment spectrum, has increased.
The announced delay to June 2021 forecast to complete the first Inventory Monetisation has been the
result.
We are positive about the performance of the Company in the coming months as we expect the first
securitisation transaction to close and the Captive Bank to launch as announced in the latest Trading
Update. The re-opening of the global economies as the uncertainty caused by COVID-19 dissipates,
particularly in the UK, Italy, the USA and UAE, our key target geographies, where vaccination
programmes are now showing the virus to be broadly under control, should be a strong stimulus to the
Group’s timely product offering.
Post balance sheet events
In the first four months of 2021, the Company announced the following material events:
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Supply@ME Capital plc
Directors’ Report
11 January 2021: SYME announced that it has entered into an agreement with Lenovo Financial
Services META LLC (“LFS”). The SYME Platform will be positioned as an alternative solution to
complement LFS’s existing vendor programme offerings to their network of customers in the
Middle East, Turkey and Africa region (excluding South Africa).
The purpose of the co-operation agreement, made with the strategic support of iMASS, was to
deliver a dedicated inventory monetisation programme to LFS’s customers which may also allow
them to evaluate the opportunity to adopt the upcoming Shariah version of the Platform.
20 January 2021: following the announcement of 3 November 2020, the Company, by virtue of
the support of the Shariah Funding Specialist and iMASS, announced that the authorisation
process for SYME’s Shariah compliant Inventory Monetisation Platform was successfully
completed.
21 January 2021: further to the Company’s announcement of 19 January, 2021, the Company’s
shares were temporarily suspended from trading on 21 January 2021 due to a technical breach
of DTR rule 2.0 (reporting timetable). This happened because SYME had, in accordance with
company law, proactively taken the decision to change its accounting reporting date to 31
December to match that of its current subsidiaries and likely future subsidiaries in the middle east
and USA. Countries have different standard reference accounting dates but it had become clear
that the typical reporting period across the Group’s target business geographies was the calendar
year.
Therefore, on 19 January 2021, the Company changed its Accounting Reference Date from 30
September to 31 December.
This change required the Company to produce two sets of historic accounts:
o Audited accounts for the nine months to 31 December 2019, which were published on
28 January 2021
o Unaudited Interim accounts to for the six months to 30 June 2020, published on 29
January 2021
Although this created additional work in the short-term, it had the immediate benefit of allowing
the Company to produce 2020 accounts completely segregated from the Abal Group’ business
and it also became clear that in the longer term, aligning all of the reporting dates to the calendar
year would significantly streamline the financial reporting consolidation process.
Despite being compliant with company law timetables for reporting when accounting reference
dates are changed, the Company was advised that it had triggered a technical stock exchange
reporting timeline breach and the Company therefore requested the temporary suspension of its
shares on 21 January 2021.
The subsequent restoration process was managed directly with the FCA during February and
trading in the Company’s shares resumed on 9 March 2021.
9 March 2021: following confirmation from the Financial Conduct Authority, the Company was
announced the restoration of its Listing on the Standard List of The London Stock Exchange and
the resumption of dealings in its Ordinary shares.
17 March 2021: SYME announced on 17 March 2021 the signing of Heads of Terms (“HoT”) for
the acquisition of Tradeflow Capital Management Pte Ltd., the leading FinTech-powered
commodities trade enabler, focused on SMEs, based in Singapore.
A sale and purchase agreement was signed and announced on 26 May 2021.
The conclusion of the acquisition (expected in early July 2021) will allow SYME’s Platform to
complete its global offering, by monetising inventory (in particular commodities) “in-transit”. Not
29
Supply@ME Capital plc
Directors’ Report
least, it generates a number of attractive synergy benefits for SYME from both a funding and
customer origination perspective.
1 April 2021: Finally, the Company, in the current trade update released on 1 April 2021,
announced the appointment of Ms Amy Benning as Chief Financial Officer with effect from 7 June
2021. Ms Benning joins from Alfa Financial Software Holdings plc, a UK main market listed
company. Prior to this she spent 12 years at PwC London where she specialised in UK capital
raising transactions, M&A and IPOs for a range of clients.
16 June 2021: The Company announced that it had entered into a subscription agreement
(“Subscription Agreement”) with Negma Group Ltd for the issue of an initial tranche of £5,600,000
of Convertible Loan Notes at £56,000 par value for which it had issued a drawdown notice at a
subscription price of £50,000 per Convertible Loan Note for an aggregate total of £5,000,000.
The Subscription Agreement allows for a further nine tranches to be issued at the same par value
at the exclusive option of the Company.
Further details can be found in note 26 of the Group consolidated financial statements.
30
Supply@ME Capital plc
Directors’ Report
Statement of Directors' Responsibilities
The Directors acknowledge their responsibilities for preparing the Annual Report and the financial
statements in accordance with applicable law and regulations.
Company law requires the Directors to prepare financial statements for each financial year. Under that
law the Directors have elected to prepare the Group consolidated financial statements in accordance with
International Accounting Standards in conformity with the requirements of the Companies Act 2006 and
International Financial Reporting Standards adopted pursuant to Regulation (EC) No 1606/2002 as it
applies in the European Union (‘IFRSs’). Under company law the Directors must not approve the
financial statements unless they are satisfied that they give a true and fair view of the state of affairs of
the Group and of the Group’s results for that period.
In preparing these financial statements, the directors are required to:
• select suitable accounting policies and apply them consistently;
• make judgements 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 Group and Company will continue in business.
The Directors are responsible for keeping adequate accounting records that are sufficient to show and
explain the Group's and the Company's transactions and disclose with reasonable accuracy at any time
the financial position of the Group and the Company and enable them to ensure that the financial
statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets
of the Group and the Company and hence for taking reasonable steps for the prevention and detection
of fraud and other irregularities.
Website publication
The Directors are responsible for ensuring that the Annual Report and financial statements are made
available on the website. Financial statements are published on the Group’s website in accordance with
legislation in the United Kingdom governing the preparation and dissemination of financial statements,
which may vary from legislation in other jurisdictions. The Directors are responsible for the maintenance
and integrity of the corporate and financial information included on the Company’s website. The Directors’
responsibility also extends to the ongoing integrity of the financial statements contained therein.
Directors’ responsibilities pursuant to DTR 4
The Directors confirm that to the best of their knowledge:
the Group consolidated financial statements have been prepared in accordance with International
Accounting Standards in conformity with the requirements of the Companies Act 2006 and
International Financial Reporting Standards adopted pursuant to Regulation (EC) No 1606/2002 as
it applies in the European Union and Article 4 of the IAS regulation and give a true and fair view of
the assets, liabilities, financial position and profit and loss of the Group; and
the Annual Report includes a fair review of the development and performance of the business and
the position of the Group, and the parent Company, together with a description of the principal risks
and uncertainties that they face.
Disclosure of information to the auditor
Each director at the date of approval of this annual report confirms that:
so far as the directors are aware, there is no relevant audit information of which the Group’s and
Company’s auditor is unaware; and
all the directors have taken all the steps that they ought to have taken as directors in order to make
themselves aware of any relevant audit information and to establish that the auditor is aware of that
information.
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Supply@ME Capital plc
Directors’ Report
Auditor
The auditor, Crowe U.K. LLP, will be proposed for re-appointment at the forthcoming Annual General
Meeting
Alessandro Zamboni
On behalf of the Board
Director
25 June 2021
*************************
32
Supply@ME Capital plc
Remuneration Report
The Company established a remuneration committee on 23 March 2020, at the time of its listing on the
main London Stock Exchange as described in the Strategic Report. The previous Remuneration
Committee in place was discontinued following the sale of the business during February 2019.
The information in the Annual Remuneration Report only contains information for the current year to 31
December 2020. Salary information for prior year has not been provided as the company was not listed
on the main market. The financial statements for the comparative period are available at Companies
House.
Remuneration Committee
The Remuneration Committee assists the Board in determining its responsibilities in relation to
remuneration, including making recommendations to the Board on the policy on Executive
remuneration, including setting the over-arching principles, parameters and governance framework of
the Group’s remuneration policy and determining the individual remuneration and benefits package of
each of the Executive Directors. The Remuneration Committee will also ensure compliance with the
Corporate Governance Code in relation to remuneration wherever possible. The Remuneration
Committee, which is chaired by Susanne Chishti, meets at least twice each year.
Nomination Committee
The Nomination Committee is responsible, amongst other things, for reviewing the structure, size and
composition of the Board and ensuring that it is comprised of the right balance of skills, knowledge and
experience, identifying and nominating for approval candidates to fill any vacancies on the Board as
and when they arise, giving full consideration to succession planning for the Company and making
recommendations as to the composition of the other committees of the Board. The Corporate
Governance Code recommends that a majority of the members of a nomination committee should be
independent non-executive directors. The Company’s Nomination Committee will meet this requirement
in due course. The Nomination ‘Committee which is chaired by Susanne Chishti meets at least twice
each year.
Remuneration Committee and Nomination Committee
The Remuneration Committee and Nomination Committee (the “Committee”) is responsible for the
establishment and any changes to the remuneration policy which will be reviewed every 12 months.
Under this policy the Committee approves the criteria and parameters in respect of remuneration of the
Board of Directors and approve salary levels in respect of Executives and Personal by external
benchmarking and alignment of overall compensation.
Remuneration policy
The main aim of the Group’s remuneration policy is the ability to offer competitive remuneration
packages which are designed to attract, retain and provide appropriate incentives to Executive Directors
and Senior Management with the experience and necessary skills to operate and develop the Group’s
business to its maximum potential, thereby delivering the highest level of return for the shareholders.
The remuneration policy was set on 7 June 2021 and will be reviewed every 12 months by the
Remuneration and Nomination Committees.
Consistent with this policy, benefits packages awarded to Executives are intended to be competitive
and will comprise a mix of non-performance-related and performance-related remuneration designed
to provide appropriate incentives to them, but not to detract from the goals of corporate governance.
33
Supply@ME Capital plc
Remuneration Report
Remuneration components for executive directors
Remuneration packages will be reviewed each year to ensure that they are in line with the Group’s
business plan and budgetary framework. No Executive Director has participated in decisions about their
own remuneration package.
Existing Board
The existing board has remained within the Company throughout the period from Listing and there have
been no settlement agreements or departure of any board members.
Alessandro Zamboni - Founder & Chief Executive Officer
Mr Zamboni was appointed as Executive Director and Chief Executive officer on 23 March 2020. The
appointment is terminable with 12 months’ notice on either side. The appointment may be terminated
immediately, if, among other things, Mr Zamboni is in material breach of his terms of appointment.
Dominic White – Non- Executive Chairman
Mr White was appointed as Non-Executive Chairman on 23 March 2020. The appointment is
terminable with 3 months’ notice on either side. The appointment may be terminated immediately, if,
among other things, Mr White is in material breach of his terms of appointment.
Enrico Camerinelli – Non-Executive Director
Mr Camerinelli was appointed as a Non-Executive Director on 23 March 2020. The appointment is
terminable with 3 months’ notice on either side. The appointment may be terminated immediately, if,
among other things, Mr Camerinelli is in material breach of his terms of appointment.
Susanne Chishti - Non-Executive Director
Ms Chishti was appointed as a Non-Executive Director on 23 March 2020. She is also chair of the
Remuneration and Nominations committees Her appointment is terminable with 3 months’ notice on
either side. The appointment may be terminated immediately, if, among other things Ms Chishti is in
material breach of her terms of appointment.
The current board members were entitled to the following annual remuneration per their respective
services during the year ended 31 December 2020. No amounts have been deferred.
Service Contracts
Annual Salary
Reviewed
Date of service
contact
Notice period
Executive directors
Alessandro Zamboni
£185,000
Salaries are
in
reviewed
March
each
year
23 March 2020
12 months
Non-executive directors
Dominic White
£100,000 to 31
August 2020
£150,000 from 1
September
2020
34
23 March 2020
3 months
Supply@ME Capital plc
Remuneration Report
Annual Salary
Reviewed
Enrico Camerinelli
Susanne Chishti
£30,000
£40,000
Potential maximum Benefit
Date of service
contact
Notice period
23 March 2020
3 months
23 March 2020
3 months
The maximum amounts that the Executive Directors could earn for the year ended 31 December 2020
is limited to the basic salary, pro-rated, as no bonus scheme, pension scheme or other benefits were
set up during the year. The purpose of the basic salary is to provide a market competitive remuneration
taking into account the roles, skills and contribution of the individual.
Subsequent to the reporting period as noted above, The Remuneration and Nominations Committee
approved the Company’s remuneration policy and this has resulted in changes in the composition of
packages for Executives. These changes will be in force for the year ended 31 December 2021 and
include additional benefits for the Executive Directors. The remuneration policy now also includes an
annual bonus to incentivise the Chief Financial Officer and Senior Management to achieve key strategic
outcomes and deliver value for the shareholders.
Policy on non- executive directors
Non-Executive directors receive fixed fees recommended by Chief Executive Officer and approved by
the Remuneration committee. In determining the appropriate level of fees, the Chief Executive Officer
considers information available for comparator companies and related market data. Non-Executive
Directors are also entitled to reimbursement of expenses in connection with attending board and other
committee meetings. It is the aim of the Company to ensure that Non-Executive Directors are paid a
level of fee that that reflects their time commitment and responsibilities to ensure that individuals with
the appropriate experience and expertise are retained.
Recruitment policy
The approach to remuneration with regard to recruiting staff is to ensure the Company pays no more
than necessary to attract the candidates with the calibre and experience the fulfil the role. The
Company would only consider candidates for a directorship if they hold the necessary experience and
qualities to help the Group enhance value to shareholders and assist in achieving its strategic goals.
Directors’ remuneration in the period
For the year ended 31 December 2020:
Salary £
Bonus £ Pension/other £
Total £
Executive directors
Alessandro Zamboni
Non -executive
directors
Dominic White
Enrico Camerinelli
Susanne Chishti
138,750
98,141
21,054
30,923
288,868
35
-
-
-
-
-
-
-
-
-
-
138,750
98,141
21,054
30,923
288,868
Supply@ME Capital plc
Remuneration Report
Pension and other benefits
No directors received any benefits under any Company or Group pension schemes. No other
remuneration was received by the directors other than the salary noted above.
Share incentive and share option plans
The Company had no share incentive plans or share option schemes for any of its directors for the year
ended 31 December 2020.
Payments to past directors
There have been no payments in the year to past directors.
Payments for loss of office
There have been no payments during the period for loss of office to past directors.
Statement of directors’ substantial shareholdings
Executive Directors
Alessandro Zamboni *
Non -Executive Directors
Dominic White **
Enrico Camerinelli
Susanne Chishti
Ordinary shares held Deferred shares held
12,742,513,009
970,723,449
Nil
Nil
Nil
Nil
Nil
Nil
* Held beneficially through the AvantGarde Group SpA
**Held beneficially through IWEP Ltd.
Susanne Chishti
Chair of the Remuneration Committee
25 June 2021
*************************
36
Supply@ME Capital plc
Corporate Governance
Statement of current Compliance with the QCA Corporate Governance Code
As Chairman of the current Board of Directors of Supply@ME Capital plc (“SYME”, “We”, or the
“Company/Group” as the context requires), it is my responsibility to ensure that SYME has both sound
corporate governance and an effective Board. My responsibilities include leading the Board effectively,
overseeing the Company’s corporate governance model, and ensuring that good information flows
freely between Executives and Non-Executives in a timely manner.
SYME has adopted the Quoted Companies Alliance Corporate Governance for small and Mid-Size
quoted companies (QCA Code). This report follows the structure of these guidelines and explains how
we have applied the guidance. We will provide annual updates on our compliance with the QCA Code.
The Board considers that the Group complies with the QCA Code so far as it is practicable having
regard to the size, nature and current stage of development of the Company, and will disclose any areas
of non-compliance in the text below.
SYME understands that application of the QCA Code supports the Company’s medium to long-term
success whilst simultaneously managing risks and providing an underlying framework of commitment
and transparent communications with stakeholders. We are committed to monitoring and promoting a
socially responsible corporate culture, illustrated through internal policies and external stakeholder
engagement.
As a Main Market company, (standard segment, trading on the London Stock Exchange) This
information needs to be reviewed annually and our website includes this information.
Dominic White
Non-Executive Chairman
Principle 1.
Establish a strategy and business model which promote long-term value for shareholders.
The Company plans to continue its growth both organically and potentially through acquisitions,
expanding its range of services, as well as expanding into new vertical and geographic markets. The
Company’s strategy and business model, as well as the competitive landscape can be found on the
Company’s website.
Principle 2.
Seek to understand and meet shareholder needs and expectations.
Dominic White, (Non-Executive Chairman) and Alessandro Zamboni (Chief Executive Officer) are the
key shareholder liaison contacts alongside the Company’s Financial Advisers. In addition, Susanne
Chishti is the Senior Independent Non-Executive Director, whom shareholders are encouraged to
contact if there are any concerns about matters relating to related party transactions and wider
corporate governance.
The Group seeks to maintain and enhance good relations with its shareholders. The Company’s interim
and annual reports will be supplemented by capital market presentations and through public
announcements to the market on corporate, technological and financial progress.
The Board will actively engage with shareholders at least three times a year. Meetings will be held
following results announcements and are either one-to-one or group meetings with institutional and high
net worth investors. Another forum for meeting shareholders is the AGM, to which all shareholders will
be invited to attend and spend time with management. In addition, the Company will seek to respond
to
address:
sent
shareholders@supplymecapital.com.
shareholder
shareholder
designated
queries
email
its
to
37
Supply@ME Capital plc
Corporate Governance
Statement of current Compliance with the QCA Corporate Governance Code
The Company’s financial and investor relations advisers help to provide the Board with investor
feedback after investor presentations and meetings, as well as calls with shareholders following key
items of news flow. Via communication with the Company’s advisers, and investment analysts, together
with Regulatory News Service announcements and the Company’s Annual Report, the Board gauges
investor sentiment, sets expectations and communicates the Company’s intentions.
Where feedback is received directly from shareholders or shareholder advisory groups, for example
relating to voting intentions on general meeting motions, this will be brought to the attention of and
discussed by the Board and the key Company investor liaisons will discuss with investors their reasons
for voting and if necessary work with these and other investors to determine an appropriate course of
action for the benefit of all shareholders.
Principle 3.
Take into account wider stakeholder and social responsibilities and their implications for long-
term success.
The Board considers the interests of shareholders and all relevant stakeholders in line with section 172
of the Companies Act 2006. Engaging with our stakeholders strengthens our relationships and helps
us make better business decisions to deliver on our commitments. The Board is regularly updated on
wider stakeholder engagement feedback to stay abreast of stakeholder insights into the issues that
matter most to them and our business, and to enable the Board to understand and consider these
issues in decision-making. Details of how we seek to understand and meet shareholder needs and
expectations are set out at Principle 2, above.
For its wider group of stakeholders, the Company intends to engage with these via:
• Face-to-face (physically or via remote systems) briefings for staff to update on the Company’s
progress and developments;
• Email updates for staff regarding developments;
• Releasing public updates via the RNS service;
• Regular meetings with key customers and commercial partners.
Stakeholder feedback is passed to Senior Management via the relevant team member as appropriate.
Principle 4.
Embed effective risk management, considering both opportunities and threats, throughout the
organisation.
The Board has established a risk management process for identifying, assessing and mitigating the
principal risks and uncertainties facing the Group. The Company’s risk register will be considered by
the Board on a quarterly basis, with ad hoc reviews conducted as required. More detail about the
identified principal risks and uncertainties can be found in the Admission Document on the Group’s
website. The Board is responsible for establishing and maintaining the Company’s system of internal
financial controls and the Audit Committee assists the Board in discharging its duties relating to internal
financial controls. Internal financial control systems are designed to meet the particular needs of the
Company and the risk to which it is exposed, and by its very nature can provide reasonable, but not
absolute, assurance against material misstatement or loss.
Areas of focus for internal financial controls include strategic planning, approval of annual budgets,
regular monitoring of performance against budget (including full investigation of significant variances),
control of capital expenditure and ensuring proper accounting records are maintained. The Directors
will continue to reassess internal financial controls as the Company expands further. It is the Board’s
policy to ensure that the management structure and the quality and integrity of the personnel are
compatible with the requirements of the Group.
38
Supply@ME Capital plc
Corporate Governance
Statement of current Compliance with the QCA Corporate Governance Code
The Company’s auditors will be encouraged to raise comments on internal control in their management
letter following their audit, and the points raised and actions arising will be monitored through to
completion by the Audit Committee.
Principle 5.
Maintaining the Board as a well-functioning, balanced team led by the Chair.
The Board consists of the Non-Executive Chairman, the Chief Executive and two additional Non-
Executive Directors. The biographical details of the Board members can be found in the Admission
Document and on the Company’s Website.
The Board has determined that Enrico Camerinelli (Aged 57) and Susanne Chishti (Aged 48) are
independent in character and judgment and satisfy the independence criteria under the QCA Code.
Susanne Chishti has also been appointed as Senior Independent Non-Executive Director.
The Board is typically expected to meet monthly in order to, amongst other things, approve financial
statements, dividends and significant changes in accounting practices and key commercial matters.
The Directors commit the requisite amount of time to their respective roles to ensure that they discharge
their individual and collective responsibilities in an effective manner. The Company has effective
procedures in place to monitor and deal with conflicts of interest.
The Board is supported by an Audit Committee, a Remuneration Committee and a Nomination
Committee. Further details of which are set out on the Company’s website.
Future annual reports will include details of the number of Board and Committee meetings taken place
each year. Until the first Annual Report is released, this is an area where the Company will not be fully
compliant with the QCA’s principles.
Principle 6.
Ensure that between them the Directors have the necessary up-to-date experience, skills and
capabilities.
The Board considers its overall size and current composition to be suitable and have an appropriate
balance of sector, financial and public markets skills and experience as well as an appropriate balance
of personal qualities and capabilities. The structure, size and composition of the Board based upon the
skills, knowledge and experience required will be regularly reviewed to ensure the Board operates
effectively.
In order to develop their skills and keep up to date with market developments and corporate governance
matters, the Board will receive training as required. All directors are also able to take independent
professional advice in the furtherance of their duties, if necessary, at the Company’s expense.
Biographies for each of the directors, including details on their experience and skills, are set out on the
Company’s website and in the Directors section of this Annual Report.
Principle 7.
Evaluate Board performance based on clear and relevant objectives, seeking continuous
improvement.
The Board’s effectiveness and the individual performance of Directors are considered regularly by the
Board on an informal basis, via feedback to the Chairman. Directors are encouraged to provide
feedback on all areas of the board efficacy, having due regard to the balance of skills, experience,
independence and knowledge contributed by members of the Board, as well as the successful operation
of the Board as a unit, its diversity and other factors relevant to its effectiveness. As the Board has just
recently been established, there is presently no formal process for independent review of directors’
performance.
39
Supply@ME Capital plc
Corporate Governance
Statement of current Compliance with the QCA Corporate Governance Code
Principle 8.
Promote a culture that is based on ethical values and behaviours.
The Board believes that the promotion of a corporate culture based on sound ethical values and
behaviours is essential to maximising shareholder value.
The executive team engenders open and positive interactions with a key focus on innovation, creative
solutions and collective responsibility. These cultures are fostered throughout the business.
The Company’s policies set out its zero-tolerance approach towards any form of modern slavery,
discrimination or unethical behaviour relating to bribery, corruption or business conduct.
Principle 9.
Maintain governance structures and processes that are fit for purpose and support good
decision-making by the Board.
Whilst the Board is collectively responsible for defining corporate governance arrangements, the
Chairman is ultimately responsible for corporate governance. The governance structures within the
Company have been assessed by the Board and are considered appropriate for the size, complexity
and risk profile of the Company. This will be reviewed by the Board to ensure governance arrangements
continue to be appropriate as the Company changes over time.
The Board is expected to typically meet bi-monthly to set the overall direction and strategy for the
Group and to review operational and financial performance. The Board and its Committees will receive
appropriate and timely information prior to each meeting: and a formal agenda will be produced for each
meeting, and Board and committee papers are distributed several days before meetings take place.
Any director may challenge Company proposals and decisions are taken democratically after
discussion. Any director who feels that any concern remains unresolved after discussion may ask for
that concern to be noted in the minutes of the meeting, which are then circulated to all directors. Any
specific actions arising from such meetings are agreed by the Board or relevant Committee and then
followed up by the Company’s management. The Company Secretary is responsible for ensuring that
Board procedures are followed and applicable rules and regulations are complied with.
There is a formal schedule of matters reserved for the decision of the Board that covers the key areas
of the Company’s affairs. The schedule includes:
• Determining the Company’s overall strategy and direction;
• Establishing and maintaining controls, audit processes and risk management policies to ensure they
counter identified risks and that the Company operates efficiently;
• Ensuring effective corporate governance;
• Approving budgets and reviewing performance relative to those budgets;
• Approving financial statements;
• Approving material agreements and non-recurring projects;
• Approving senior and Board appointments.
Each member of the Board has clearly defined roles and responsibilities. The role of the Chairman is to
lead the Board, with responsibility for overall corporate governance, and to ensure it is operating
effectively in approving and monitoring the strategic direction of the Company. The role of the Chief
Executive is to propose strategic direction to the Board and to execute the approved strategy by leading
the executive team in managing the Company’s business. The role of the Non-Executive Directors is to
act as a sounding board for the Chairman and a source of reciprocal feedback for other members of
the Board and shareholders, where required. The Board is supported by an Audit Committee and
Remuneration Committee, further details of which are set out on the Company’s website. At present,
the Company does not produce formal Audit Committee or Remuneration Committee reports for the
purposes of the annual report, given the size and scale of the Company’s current operations. The Board
however continually review this position and at such time as it is deemed appropriate to do so, will
include formal Audit and Remuneration Committee reports in the Company’s annual report.
40
Supply@ME Capital plc
Corporate Governance
Statement of current Compliance with the QCA Corporate Governance Code
Principle 10.
Communicate how the Company is governed and is performing by maintaining a dialogue with
shareholders and other relevant stakeholders.
The Company is committed to open communications with all its shareholders. Communication will be
primarily through the Company’s website, the annual report and accounts, Regulatory announcements,
the AGM and one-to-one meetings with large existing or potential new shareholders. All shareholders
will receive a copy of the annual report and an interim report at the half year is available on the
Company’s website.
Matters reserved for the Board
The board had a formal written schedule of matters reserved for its review and approval; this schedule
included those matters described in The role of the board and its committees section as well as those
in the following table.
Category
Strategy and
management
Structure and capital
Examples
Extension of the Group’s activities into new business or geographic areas;
cessation of the operation of all or any material part of the Group’s business.
Changes relating to the Group’s capital structure; major changes to the
Group’s corporate or management and control structure; changes to the
Company’s listing or its status as a plc.
Financial reporting and
controls
the
Approval of
following: annual report and accounts, preliminary
announcements of results, significant changes in accounting policies or
practices,
treasury policies, certain unbudgeted capital or operating
expenditure; declaration or recommendation of dividends; review and
approval of expenditure authorisation limits.
Contracts
Contracts in the ordinary course of business material strategically or by reason
of size; contracts not in the ordinary course of business; major investments.
Communication
Approval of resolutions, circulars, prospectuses and press releases
concerning matters decided by the board.
Board membership and
other appointments
Changes to the structure, size and composition of the board; ensuring
adequate succession planning for the board and senior management; board
appointments; selection of the chair and the chief executive; appointment of
the senior independent director; membership and chairs of board committees;
continuation in office of directors; appointment or removal of the company
secretary; appointment, reappointment or removal of the external auditor to
be put to shareholders for approval.
Remuneration
Approving the remuneration policy for the directors; determining the initial
remuneration of the non-executive directors; introduction of new share
incentive plans or major changes to existing plans.
Delegation of authority Division of responsibilities between the chair and the chief executive;
establishing board committees and approving their terms of reference.
Corporate governance
Undertaking any formal and rigorous review of the board’s own performance,
individual directors, and the division of
that of its committees and
responsibilities; determining the independence of non-executive directors;
review of
the Group’s overall corporate governance arrangements;
authorising conflicts of interest where permitted by the Company’s articles of
association.
41
Supply@ME Capital plc
Corporate Governance
Statement of current Compliance with the QCA Corporate Governance Code
Policies and procedures
Approval of the following: compliance with the Stock Exchange Rules and
aspects of the Market Abuse Regulation, company’s insider list manual,
dealing code, anti-bribery policy, whistleblowing policy and health and safety
policy.
Attendance at Board and committee meetings in the year to 31 December 2020
Meetings attended / held:
Alessandro Zamboni
Dominic White
Enrico Camerinelli
Susanne Chishti
Simon Charles
John Treacy
Board
Nominations
committee
Audit committee
Remuneration
committee
8/8
8/8
8/8
7/8
0/0
0/0
1/1
1/1
1/1
1/1
0/0
0/0
1/1
1/1
1/1
1/1
0/0
0/0
1/1
1/1
1/1
1/1
0/0
0/0
Prior to the Reverse Takeover of Supply@ME S.r.l. the previous Group had sold all of its business and
business assets in February 2019, and from that date until the acquisition of Supply@ME S.r.l. the
Company was a non-trading cash shell seeking new investments opportunities.
As such, the Company in the prior reporting period and the period since the last year end to the date of
the Reverse Takeover did not:
operate an internal audit function
establish a remuneration committee
operate a remuneration committee
hold formal Board meetings.
In this period the Non-executive directors met on an ad hoc basis to further the interests of the Company
by seeking an appropriate investment opportunity and to ensure there were sufficient funds for the
Company to continue until such an investment was found.
Independence
Independent Directors
The role of the Independent or Senior Independent Director is to be available to shareholders who wish
to raise any concerns that they have been unable to resolve through other channels and to attend
meetings between management and major investors.
From the date of the Main Market listing on 23 March 2020 to the end of the period, Susanne Chishti
was identified as the Group’s Senior Independent Director. Ms Chishti brings over 20 years of financial
expertise and board-level experience focused on organisational governance, and a strong understanding of
the small/medium size enterprise market. She holds no shares in the Company and the Board has concluded
that she was independent throughout the period since her appointment.
In the previous period and until the date of the Main Market listing, Simon Charles was identified as the
Group’s Independent Director.
42
Supply@ME Capital plc
Corporate Governance
Statement of current Compliance with the QCA Corporate Governance Code
The Board had concluded that Simon Charles was independent throughout the period. Simon Charles
is a partner in Marriot Harrison, the former legal advisors to the Company and also held a small number
of shares. However transactions with Marriot Harrison and his interests in shares were considered to
be too small to affect his independence and legal services had been tendered and decided on by the
other directors.
Time commitment
The executive directors are expected to devote substantially all of their time and ability to their duties.
The non-executive directors were expected to devote about 12 days each year to the Company’s
business.
Service contracts and letters of Appointment
Copies of all contracts of employment and letters of appointment are available for inspection at the
Company’s registered office.
*************************
43
Supply@ME Capital plc
Independent auditor’s report to the Members of Supply@ME Capital plc
Opinion
We have audited the financial statements of Supply@ME Capital plc (the “Company”) and its
subsidiaries (the ‘group’) for the year ended 31 December 2020 which comprise the Consolidated
Statement of Comprehensive Income, Consolidated Statement of Financial Position, Consolidated
Statement of Changes in Equity and Consolidated Statement of Cash Flows and notes to the financial
statements, including a summary of significant accounting policies. The financial reporting framework
that has been applied in their preparation is applicable law and International Accounting Standards in
conformity with the requirements of the Companies Act 2006 and International Financial Reporting
Standards adopted pursuant to Regulation (EC) No. 1606/2002 as it applies in the European Union.
The financial reporting framework that has been applied in the preparation of the parent company
financial statements is applicable law and United Kingdom Accounting Standards, including Financial
Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland
(United Kingdom Generally Accepted Accounting Practice).
In our opinion, the financial statements:
the financial statements give a true and fair view of the state of the group’s and of the company’s
affairs as at 31 December 2020 and of the group’s loss for the year then ended;
The group financial statements have been properly prepared in accordance International
Accounting Standards in conformity with the requirements of the Companies Act 2006 and
International Financial Reporting Standards adopted pursuant to Regulation (EC) No. 1606/2002
as it applies in the European Union;
the parent company financial statements have been properly prepared in accordance with United
Kingdom Generally Accepted Accounting Practice; and
the financial statements have been prepared in accordance with the requirements of the Companies
Act 2006; and, as regards the group financial statements, Article 4 of the IAS Regulation.
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
company 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, 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 relating to going concern
We draw your attention to Note 2 which indicates the existence of uncertainties in relation to
assumptions about future trading that support the going concern basis of preparation. As stated in
Note 2, these events or conditions, along with other matters as set forth in Note 2 indicate that a
material uncertainty exists that may cast significant doubt on the company’s ability to continue as a
going concern. Our opinion is not modified in respect of this matter.
In auditing the financial statements, we have concluded that the directors' use of the going concern
basis of accounting in the preparation of the financial statements is appropriate. Our evaluation of the
directors’ assessment of the entity’s ability to continue to adopt the going concern basis of accounting
included:
we reviewed and challenged the forecast revenues and resulting cash flows within the
assessment period, the uncertainties that are disclosed in note 2 impact the quantum and timing
of these cashflows;
we agreed the cash inflows from the issue of convertible loan notes to post year end bank
statements;
we agreed the forecast cash outflows relating to the acquisition of TradeFlow Capital
Management Pte Limited to the share purchase agreement;
we tested to ensure the mathematical accuracy of the model presented; and
we reviewed the appropriateness of the disclosure made and its consistency with our knowledge
of the business.
44
Supply@ME Capital plc
Independent auditor’s report to the Members of Supply@ME Capital plc
Overview of our audit approach
Materiality
In planning and performing our audit we applied the concept of materiality. An item is considered
material if it could reasonably be expected to change the economic decisions of a user of the financial
statements. We used the concept of materiality to both focus our testing and to evaluate the impact of
misstatements identified.
Based on our professional judgement, we determined overall materiality for the financial statements
as a whole to be £72,000, based on 5% of the adjusted loss for the period. Materiality for the parent
company financial statements as a whole was set at £21,000 based on its loss for the period.
We use a different level of materiality (‘performance materiality’) to determine the extent of our testing
for the audit of the financial statements. Performance materiality is set based on the audit materiality
as adjusted for the judgements made as to the entity risk and our evaluation of the specific risk of
each audit area having regard to the internal control environment. We determined performance
materiality to be £54,000.
Where considered appropriate performance materiality may be reduced to a lower level, such as, for
related party transactions and directors’ remuneration.
We agreed with the Audit Committee to report to it all identified errors in excess of £1,250. Errors
below that threshold would also be reported to it if, in our opinion as auditor, disclosure was required
on qualitative grounds.
Overview of the scope of our audit
Following the reverse acquisition transaction in March 2020 the group consists of two components,
Supply@ME Capital plc, a holding company based in London, United Kingdom and its only trading
subsidiary, Supply@ME Srl based in Italy. Supply@ME Capital plc was audited by us and was
conducted from the UK. Audit work on the significant non-UK component, Supply@ME Srl, was
carried out by a member of the Crowe Global International network as component auditor.
We engaged with the component auditor at all stages during the audit process. We directed the
component auditors regarding the audit approach at the planning stage, issued instructions that
detailed the significant risks to be addressed through the audit procedures and indicated the
information we required to be reported on.
The impact of the Covid-19 pandemic in relation to quarantine restrictions in the UK and Italy, and
international travel restrictions in general, meant that is was not possible for the audit team, including
the audit engagement partner, to visit the component auditors and the principal finance locations of
the significant non-UK component in order to review the component auditors’ working papers, discuss
key findings directly with the component audit team, specialist team members and component auditor
reporting partner and conclude on significant issues. Instead, regular progress calls and file sharing
were considered appropriate in the circumstances.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the financial statements of the current period and include the most significant assessed
risks of material misstatement (whether or not due to fraud) that we identified. These matters included
those which had the greatest effect on: the overall audit strategy, the allocation of resources in the
audit; and directing the efforts of the engagement team. These matters were addressed in the context
of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not
provide a separate opinion on these matters.
Other than the material uncertainty relating to going concern we identified the following key audit
matters:
45
Supply@ME Capital plc
Independent auditor’s report to the Members of Supply@ME Capital plc
Key audit matter
How our scope addressed the key audit matter
Reverse acquisition accounting
During the year to 31 December 2020
the company entered into a reverse
acquisition transaction. This is the most
material transaction in the period and
has the most significant impact on the
presentation of the financial statements.
There is a risk that an error in the
reverse acquisition accounting could
have a material impact on the financial
statements.
Revenue recognition
Following the reverse acquisition, the
Group has recognised revenues in both
2019 and 2020. This is the first year the
legal subsidiary has prepared its
financial information under IFRS and
therefore there is an increased risk that
revenue has been incorrectly
recognised having regard to the
requirements of IFRS 15.
We developed an understanding of the transaction to ensure
the conditions for Reverse acquisition accounting were
present.
We obtained management’s assessment regarding whether
Supply@ME Capital plc met the definition of a business as
this would impact the accounting.
We reviewed the accounting policy for the transaction to
ensure it is in line with IFRS.
We reviewed the fair value assessment of the share capital of
the accounting acquiree by having regard to the pre-
suspension share price.
We reviewed the accounting entries to ensure their accuracy
having regard to the agreed policy.
We recalculated the deemed cost of listing to ensure it is in
line with our expectation.
Key observation:
Based on the procedures we performed we did not identify
anything which suggested material error or omission relating
to the reverse acquisition accounting.
We obtained management’s assessment regarding the
revenue recognition policy under IFRS 15 to develop our
understanding of the group revenue streams and
performance obligations.
We obtained a sample of contracts and critically assessed if
the revenue recognition policy applied was appropriate, in
line with IFRS 15, and accurately reflected the contract and
performance obligations.
Key observation:
Based on the procedures we performed we did not identify
anything which suggested material error or omission relating
to the revenue recognition.
Our audit procedures in relation to these matters were designed in the context of our audit opinion as
a whole. They were not designed to enable us to express an opinion on these matters individually and
we express no such opinion.
Other information
The other information comprises the information included in the annual report other than the 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 financial statements does not cover the other information and, except to the extent
otherwise explicitly stated in our report, 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 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 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.
46
Supply@ME Capital plc
Independent auditor’s report to the Members of Supply@ME Capital plc
Opinions on other matters prescribed by the Companies Act 2006
In our opinion the part of the directors’ remuneration report to be audited has been properly prepared
in accordance with the Companies Act 2006.
In our opinion based on the work undertaken in the course of our audit
the information given in the strategic report and the directors' report for the financial period for
which the financial statements are prepared is consistent with the financial statements; and
the directors’ report and strategic report have been prepared in accordance with applicable legal
requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the Company and its environment obtained in the
course of the audit, we have not identified material misstatements in the strategic report or the
directors’ report.
We have nothing to report in respect of the following matters in relation to which the Companies Act
2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept by the Company, or returns adequate for our
audit have not been received from branches not visited by us; or
the financial statements and the part of the directors’ remuneration report to be audited are not in
agreement with the accounting records and returns; or
certain disclosures of directors’ remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit
Responsibilities of the directors for the financial statements
As explained more fully in the directors’ responsibilities statement set out on page 31 the directors are
responsible for the preparation of the 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 financial statements that are free from material misstatement, whether due to fraud or
error.
In preparing the financial statements, the directors are responsible for assessing the Company’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
Company 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 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 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:
Our audit procedures included:
enquiry of management about the Company’s policies, procedures and related controls regarding
compliance with laws and regulations and if there are any known instances of non-compliance;
examining supporting documents for all material balances, transactions and disclosures;
review of the Board of directors and the Audit Committee minutes;
47
Supply@ME Capital plc
Independent auditor’s report to the Members of Supply@ME Capital plc
enquiry of management about litigations and claims and inspection of relevant correspondence;
evaluation of the selection and application of accounting policies related to subjective
measurements and complex transactions;
analytical procedures to identify any unusual or unexpected relationships;
testing the appropriateness of journal entries recorded in the general ledger and other
adjustments made in the preparation of the financial statements; and
review of accounting estimates for biases.
Owing to the inherent limitations of an audit, there is an unavoidable risk that some material
misstatements of the financial statements may not be detected, even though the audit is properly
planned and performed in accordance with the ISAs (UK). The potential effects of inherent limitations
are particularly significant in the case of misstatement resulting from fraud because fraud may involve
sophisticated and carefully organized schemes designed to conceal it, including deliberate failure to
record transactions, collusion or intentional misrepresentations being made to us.
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.
Other matters which we are required to address
We were appointed by management to audit the financial statements for the year ending 31
December 2020. Our total uninterrupted period of engagement is two periods, covering the periods
ending 31 December 2020 and 31 December 2019.
The non-audit services prohibited by the FRC’s Ethical Standard were not provided to the Company
and we remain independent of the Company in conducting our audit.
Our audit opinion is consistent with the additional report to the board.
Use of our report
This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of
Part 16 of the Companies Act 2006. 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.
Leo Malkin
Senior Statutory Auditor
For and on behalf of
Crowe U.K. LLP
Statutory Auditor
London
25 June 2021
*************************
48
Supply@ME Capital plc
Consolidated Statement of Comprehensive Income for the Year Ended 31
December 2020
Continuing operations
Revenue
Cost of sales
Gross profit
Administrative expenses
Exceptional costs
Other operating income
Operating (loss)/profit
Finance costs
(Loss)/profit before tax
Income tax
(Loss)/profit for the year
Other comprehensive income
Foreign exchange differences on consolidation
Total comprehensive (loss)/profit for the year
Loss attributable to:
Owners of the company
Year ended 31
December 2020
£ 000
Year ended 31
December 2019
£ 000
Note
4
5
6
7
11
1,147
(739)
408
(1,904)
(1,376)
53
(2,819)
-
(2,819)
(145)
(2,964)
2
(2,962)
4
(767)
(763)
(98)
-
174
(687)
-
(687)
133
(554)
3
(551)
(2,962)
(551)
Earnings per share (EPS)
Basic and diluted EPS
12
Pence
(0.01)
Pence
0.00
The notes on pages 54 to 76 form an integral part of these consolidated financial statements.
49
Supply@ME Capital plc
Consolidated Statement of Financial Position as at 31 December 2020
Non-current assets
Intangible assets
Property, plant and equipment
Total non-current assets
Current assets
Trade and other receivables
Cash and cash equivalents
Total current assets
Total assets
Current liabilities
Trade and other payables
Derivative financial instruments
Total current liabilities
Net current liabilities
Non-current liabilities
Provisions
Total non-current liabilities
Net liabilities
Equity attributable to owners of the parent
Share capital
Share premium
Other reserves
Retained losses
Total equity
Note
13
14
17
16
18
15
15
As at 31
December 2020
£ 000
As at 31
December 2019
£ 000
1,236
2
1,238
1,535
552
2,087
3,325
3,395
24
3,419
(1,332)
358
358
390
-
390
919
143
1,062
1,452
1,810
-
1,810
(748)
199
199
(452)
(557)
5,420
11,820
(13,986)
(3,706)
(452)
148
-
-
(705)
(557)
The notes on pages 55 to 76 form an integral part of these consolidated financial statements.
The consolidated financial statements on pages 49 to 76 were approved and authorised for issue by
the Board on 25 June 2021 and signed on its behalf by:
.........................................
Mr Alessandro Zamboni
Director
Supply@ME Capital plc
Registration number: 03936915
50
Supply@ME Capital plc
Consolidated Statement of Cash Flows for the Year Ended 31 December 2020
Year ended 31
December 2020
£ 000
Year ended 31
December 2019
£ 000
Cash flows from operating activities
(Loss) for the year
Foreign exchange differences on retranslation
Depreciation, amortisation and impairments
Deemed cost of listing in reverse acquisition
Allocated to provisions
Other adjustments to increase non-monetary items
Decrease/(increase) in trade and other receivables
Increase/(decrease) in trade and other payables
Other decreases/(increases) in net working capital
Cash flows from operations
Finance costs
Income taxes paid
Other collections
Net cash flow from operating activities
Cash flows from investing activities
Cash from reverse acquisition of Abal plc
Acquisition of property, plant and equipment
Acquisition of intangible assets
Net cash flows from investing activities
Cash flows from financing activities
Increase/(decrease) in short term bank loans
New loans
Proceeds from issue of ordinary shares, net of allowable
issue costs
Net cash flows from financing activities
Net increase in cash and cash equivalents
Foreign exchange differences to cash and cash equivalents
on consolidation
Cash and cash equivalents at 1 January
Cash and cash equivalents at 31 December
(2,819)
4
203
1,376
40
16
(717)
296
682
(919)
(19)
6
(932)
93
(2)
(1,026)
(935)
22
-
2,230
2,252
385
24
143
552
(687)
21
94
-
-
-
(1)
(119)
967
275
-
-
-
275
-
-
(132)
(132)
(2)
-
-
(2)
141
-
2
143
The reconciliation of the movement in net debt is set out in note 23.
The notes on pages 54 to 76 form an integral part of these consolidated financial statements.
51
Supply@ME Capital plc
Consolidated Statement of Changes in Equity for the Year
Ended 31 December 2020
Share capital
£ 000
Share premium
£ 000
Other reserves
£ 000
Forex reserve
£ 000
Retained earnings
£ 000
Total
£ 000
At 1 January 2019
Forex retranslation
At 1 January 2019 after forex retranslation
Loss for the year
Forex retranslation difference
Loss for the year and total comprehensive income
At 31 December 2019
148
-
148
-
-
-
148
-
-
-
-
-
-
-
The notes on pages 54 to 76 form an integral part of these consolidated financial statements.
-
-
-
-
-
-
-
-
-
-
-
3
3
3
(163)
9
(154)
(554)
-
(554)
(15)
9
(6)
(554)
3
(551)
(708)
(557)
52
Supply@ME Capital plc
Consolidated Statement of Changes in Equity for the Year
Ended 31 December 2020
Share
capital
£ 000
Share
premium
£ 000
Other
reserves
£ 000
Merger
relief
reserve
£ 000
Reverse
takeover
reserve
£ 000
Forex
reserve
£ 000
Retained
earnings
£ 000
At 1 January 2020
Forex retranslation
At 1 January 2020 after forex retranslation
Loss for the year
Forex retranslation difference
Loss for the year and total comprehensive income
Transfer to reverse takeover reserve
Recognition of plc equity at acquisition date
Reverse takeover of Supply@ME S.r.l.
Issue of shares for cash
Cost of share issues
Legal reserve
148
-
148
-
-
-
(148)
4,767
646
7
-
-
-
-
-
-
-
-
-
9,597
-
2,234
(11)
-
-
-
-
-
(8)
(8)
-
-
-
-
-
12
-
-
-
-
-
-
-
-
-
-
-
-
-
-
223,832
-
-
-
148
(13,505)
(224,478)
-
-
-
3
-
3
-
10
10
-
-
-
-
-
-
Total
£ 000
(557)
(34)
(591)
(708)
(34)
(742)
(2,964)
-
(2,964)
(2,964)
2
(2,962)
-
-
-
-
-
-
-
859
-
2,241
(11)
12
At 31 December 2020
5,420
11,820
4
223,832
(237,835)
13
(3,706)
(452)
The notes on pages 54 to 76 form an integral part of these consolidated financial statements.
53
Supply@ME Capital plc
Notes to the Consolidated Financial Statements for the Year Ended 31
December 2020
1 General information
These consolidated financial statements have been prepared in accordance with international
accounting standards in conformity with the requirements of the Companies Act 2006 and International
Financial Reporting Standards adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the
European Union.
The financial statements of the Group, consisting Supply@ME Capital plc (the “Company”) and its
subsidiaries, are presented in Pounds Sterling and all values are rounded to the nearest thousand
pounds (£’000) excepted when otherwise stated.
These consolidated financial statements have been prepared in accordance with the accounting policies
set out below, which have been consistently applied to all the years presented.
2 Accounting policies
Going concern
For the reasons set out below, the Directors consider that it is appropriate to adopt the going concern
basis in preparing these consolidated financial statements.
At the year-end the Group had cash balances of £552,000 (2019: £143,000) and net current liabilities
of £1,332,000 (2019: net current liabilities £748,000). The Group has posted a loss for the year after
tax of £2,964,000 (2019: loss £554,000) and retained losses were £3,706,000 (2019: losses £705,000).
The net current liabilities as at the year-end of £1,332,000 included current liabilities of £1,131,000 in
relation to down-payments made by clients with respect to due diligence services provided. The loss
after tax of £2,964,000 was after charging an exceptional, non-cash cost of £1,376,000 relating to the
Reverse Takeover referred to in note 3 and a £145,000 tax charge which is expected to be substantially
reduced by research and development credits for which the Group is applying.
During the year, the Group was successfully admitted to trading as a Main Market company, standard
segment, trading on the London Stock Exchange having also issued placing shares with gross proceeds
of £2,240,000 (net proceeds of £1,615,000 after deducting all costs in respect of the placing and reverse
takeover).
The Directors have reviewed the forecast cashflows for the next 12 months and consider the Group to
be a going concern.
The cashflow forecasts are based on the enlarged group, following the Reverse Takeover in March
2020 and therefore relate to cashflows arising from the Group’s Fin Tech platform that focusses on
inventory monetisation facilities. The Directors have prepared the forecast using their best estimates;
however, the Group is in its start-up phase and therefore they have identified the following uncertainty
in the model.
The ability of the Group to acquire inventory is reliant on investment funding for securitisation being
received, and whilst the Group is in very advanced negotiations with several interested partners, no
securitisation investment had been finalised as at the date of this report. If no, or limited investment is
secured during the next 12 months, the Group cannot acquire inventory as assumed in the model and
generate the service fee income.
In addition the Group has a portfolio of interested customers, with some having signed term sheets.
The cashflow model assumes a growth in customer base in line with the interest that has been received
in the product but there is uncertainty over the ability of the group to be able to secure these new
customers.
54
Supply@ME Capital plc
Notes to the Consolidated Financial Statements for the Year Ended 31
December 2020
On the basis of the above matters the Directors have a material uncertainty in relation to its going
concern status. In mitigation, however, a corporate funding organisation has made sufficient funds
available to stimulate the growth of the Group and accommodate any delays in revenue generation.
Therefore, given the significant interest from a growing secured customer base, as described elsewhere
in this report and the advanced nature of securitisation funding negotiations, the Directors consider it
appropriate to prepare the consolidated financial statements on a going concern basis.
Impact of the global pandemic
As noted previously in numerous announcements, the Board has monitored closely the impact of
COVID-19 on business operations.
Impact on Client companies
The Group’s Client company customer base remains strong and the demand for inventory monetisation
continues to grow. The number of Client companies being originated by the Group has grown each
quarter since the Reverse Take Over in March 2020. Increasingly, following COVID-19, many
businesses are consciously choosing to build inventory to avoid supply chain shortages and subsequent
loss of trade, rather than keep stock levels low. This is positive development for Group's business
model as it expects that Client companies internationally will look to monetise these higher volumes of
stock held.
Impact on Inventory funders
The impact of COVID-19 on Inventory funders, that is the investors through the SYME Platform into the
inventory portfolios, has been more difficult to interpret.
Interest rates are at historic lows which means that investors are getting lower returns on capital
compared to previous years when higher interest rates were the norm. SYME's new inventory asset
class will offer a strong relative margin compared to interest rates on a risk adjusted basis. However,
investors are undoubtedly more cautious and taking longer to make decisions. Time to close
transactions, not only in Inventory funding, but across the investment spectrum, has increased.
The announced delay to June 2021 forecast to complete the first Inventory Monetisation has been the
result.
We are positive about the performance of the Group in the coming months as we expect the first
securitisation transaction to close and the Captive Bank to launch as announced in the latest Trading
Update. The re-opening of the global economies as the uncertainty caused by COVID-19 dissipates,
particularly in the UK, Italy, the USA and UAE, our key target geographies, where vaccination
programmes are now showing the virus to be broadly under control, should be a strong stimulus to the
Group’s timely product offering.
Basis of consolidation
The Group financial statements consolidate those of the Company and its subsidiary undertaking drawn
up to 31 December 2020. Subsidiaries are entities over which the Group has control. Control
comprises an investor having power over the investee and 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.
Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They
are deconsolidated from the date that control ceases.
On 23 March 2020, the Company, completed a reverse acquisition of Supply@ME S.r.l., a company
registered in Italy. Further information about this transaction is disclosed in note 3.
Intra-group balances and transactions, and any unrealised income and expenses arising from intra-
group transactions, are eliminated. Unrealised losses are eliminated in the same way as unrealised
gains, but only to the extent that there is no evidence of impairment.
55
Supply@ME Capital plc
Notes to the Consolidated Financial Statements for the Year Ended 31
December 2020
The comparative period for the Group is 1 January 2019 to 31 December 2019 and includes the results
of the subsidiary only.
New and revised accounting standards and interpretations
A number of relevant new standards are effective for annual periods beginning as noted below, for
which earlier application is permitted. However, the Group has not adopted the new or amended
standards in preparing these consolidated financial statements. The following amended standards and
interpretations are not expected to have a significant impact on the Group's consolidated financial
statements:
Standard and interpretations
Effective
annual
for
periods beginning on or
after
Covid-19 related rent concessions – amendment to IFRS 16
1 June 2020
Interest rate benchmark reform, phase 2 – amendments to IFRS 4,
IFRS 9, IFRS 16 and IAS 39
1 January 2021 *
Deferral of IFRS 9 – amendment to IFRS 4
1 January 2021 *
* subject to UK endorsement
Revenue recognition
Revenue for the Group is measured at the fair value of the consideration received or receivable. The
Group recognises revenue when the amount of revenue can be reliably measured and it is probable
that future economic benefits will flow to the entity.
At this stage of the Group’s development, its earnings derive from due diligence performed by Group
subsidiaries on potential clients to prequalify them as suitable candidates for inventory securitisation.
Those clients who sign a term sheet are required to make a down payment to remunerate the subsidiary
for the due diligence work that has been completed or is to be done. Revenue is recognised in the
period in respect of the due diligence work that has been completed in the period, which is assessed
on a client-by-client basis.
Where performance obligations exist in customer contracts, revenue is recognised in accordance with
the stage of completion of the contract. Each performance obligation (“milestone”) is established in
relation to individual contract and its specified price. Revenue is only recognised when the work
obligation contracted has been performed. If partly performed against pre-established milestones, only
the revenue relating to the completed milestones is recognised.
Cost of Sales
Cost of sales represents those costs that can be directly related to the sales effort. At this early stage
in the Group’s development, where sales are represented by fees for conducting pre-qualification due
diligence on potential clients, the entire work force is engaged in that process, with input from external
consultants. Their costs, plus the amortisation of intangible assets are regarded by management as the
direct costs associated with selling; in line with similar FinTech companies.
Leases
IFRS 16 Leases became effective for annual periods beginning on or after 1 January 2019 and the
company elected to adopt it on a prospective basis. The Directors have considered the impact of this
new standard in the preparation of these consolidated financial statements. At this time, the Group does
56
Supply@ME Capital plc
Notes to the Consolidated Financial Statements for the Year Ended 31
December 2020
not have any material lease arrangements and therefore no adjustments are considered necessary as
a result of this new standard.
Property, plant and equipment
Recognition and measurement
All plant and equipment is stated at cost less subsequent depreciation and impairment. The costs of
the property, plant and equipment is purchase price plus any incidental costs of acquisition.
Depreciation commences at the point the asset is brought into use.
If there is any indication that an asset's value is less than it’s carrying amount an impairment review is
carried out. Where impairment is identified an asset's value is reduced to reflect this.
The residual values and useful economic lives of fixed assets are reviewed by management on an
annual basis and revised to the extent required.
Depreciation
Depreciation is provided to write off the cost, less estimated residual values, of all plant and equipment
equally over their expected useful lives. It is calculated at the following rates:
Equipment at 33% per annum.
Intangible assets
Recognition and measurement
The core activity of the business is the creation and marketing of a software-driven secure system for
the recording and management of third party lots of inventory that can be funded through third party
securitisation contracts, from which the Group derives fees.
Associated with that core activity are significant product development requirements to address
compliance with legal, regulatory, accounting, valuation and insurance criteria. The three main
categories of cost are: Software development, intellectual property (IP) related costs and professional
fees.
Amortisation
These costs are capitalised and amortised over their estimated useful economic lives, considered to be
5 years, on a straight line basis. Amortisation methods and useful lives are reviewed at each reporting
date and adjusted if appropriate.
Impairment
At the end of each accounting period the Group assess the recoverable amounts of intangible assets.
Where there is an indication of impairment an impairment loss is recognised for the amount by which
the assets carrying value exceed its recoverable amount. Impairment losses are recognised in the profit
and loss.
Tax
The tax expense for the period comprises current tax. Tax is recognised in profit or loss, except that a
charge attributable to an item of income or expense recognised as other comprehensive income is also
recognised directly in other comprehensive income.
Deferred tax is recognised on differences between the carrying amounts of assets and liabilities in the
consolidated financial statements and the corresponding tax bases used in the computation of taxable
profit and is accounted for using the statement of financial position liability method. Deferred tax
57
Supply@ME Capital plc
Notes to the Consolidated Financial Statements for the Year Ended 31
December 2020
liabilities are generally recognised for all taxable temporary differences and deferred tax assets are
recognised to the extent that it is probable that taxable profits will be available against which deductible
temporary differences can be utilised. Such assets and liabilities are not recognised if the temporary
difference arises from goodwill or from the initial recognition (other than in a business combination) of
other assets and liabilities in a transaction that affects neither the taxable profit nor the accounting profit.
The carrying amount of any deferred tax assets is reviewed at each statement of financial position date
and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to
allow all or part of the asset to be recovered.
Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is
settled or the asset realised based on tax rates that have been enacted or substantively enacted at the
statement of financial position date. Deferred tax and current tax are charged or credited to profit or
loss, except when it relates to items charged or credited in other comprehensive income or directly to
equity, in which case the deferred tax is also recognised in other comprehensive income or equity
respectively.
Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and other short-term highly liquid investments that
are readily convertible to a known amount of cash and are subject to an insignificant risk of change in
value.
Functional and presentational currencies
The consolidated financial statements are presented in pounds sterling (£), the Company’s functional
currency.
Foreign currency
The main currencies for the Group are the euro (EUR) and pounds sterling (£).
Foreign currency transactions and balances
Foreign currency transactions are translated into the functional currency using the average exchange
rates in the month. Foreign exchange gains and losses resulting from the settlement of such
transactions and from the translation at the reporting period end exchange rates of monetary assets
and liabilities denominated in foreign currencies are recognised in the statement of comprehensive
income.
Share capital, share premium and brought forward earnings are translated using the exchange rates
prevailing at the dates of the transactions.
Consolidation of foreign entities:
On consolidation, results of the foreign entities are translated from the local currency to pounds sterling,
the presentational currency of the Group, using average exchange rates during the period. All assets
and liabilities are translated from the local functional currency to pounds sterling using the reporting
period end exchange rates. The exchange differences arising from the translation of the net investment
in foreign entities are recognised in other comprehensive income and accumulated in a separate
component of equity.
Employee benefits
Short-term employee benefits
The Group accounts for employee benefits in accordance with IAS 19.
Short-term employee benefits are expensed as the related service is provided. A liability is recognised
for the amount expected to be paid if the Group has a present legal or constructive obligation to pay
58
Supply@ME Capital plc
Notes to the Consolidated Financial Statements for the Year Ended 31
December 2020
this amount as a result of past service provided by the employee and the obligation can be estimated
reliably.
Defined contribution pension obligations
The Group accounts for retirement benefit costs in accordance with IAS 19 Employee Benefits.
Contributions to the Group's defined contributions pension scheme are charged to profit or loss in the
period in which they become payable.
Financial assets
Classification
Financial assets currently comprise trade and other receivables, cash and cash equivalents.
Recognition and measurement
Loans and receivables
Loans and receivables are mainly contractual trade receivables and are non-derivative financial assets
with fixed or determinable payments that do not have a significant financial component and are not
quoted in an active market. Accordingly, trade and other receivables are recognised at undiscounted
invoice price. A reserve for credit risk is made at the beginning of each transaction and adjusted
subsequently through profit and loss.
Impairment provisions for trade receivables are recognised based on the simplified approach within
IFRS 9 using the lifetime expected credit losses. During this process the probability of the non-payment
of trade receivables is assessed. This probability is then multiplied by the amount of the expected loss
arising from default to determine the lifetime expected credit loss for the trade receivables. For trade
receivables, which are reported net, such provisions are reported in a separate provision account with
the loss being recognised within administrative expenses in the consolidated statement of
comprehensive income. On confirmation that the trade receivable will not be collectable, the gross
carrying value of the asset is written off against the associated provision.
Cash and cash equivalents
Cash and other short-term deposits in the Statement of Financial Position comprise cash at banks and
in hand and short-term deposits with an original maturity of three months or less and where there is an
insignificant risk of changes in value. In the consolidated cash flow statement, cash and cash
equivalents consist of cash and cash equivalents as defined above.
Financial liabilities
Classification
Financial liabilities comprise trade and other payables, convertible loan notes and derivative financial
instruments.
Recognition and measurement
Trade and other payables
Trade and other payables are initially recognised at fair value less transaction costs and thereafter
carried at amortised cost.
Derivative financial instruments
The Group’s derivative financial instruments are a convertible loan note that was both issued and then
cleared in the previous period year by a debt for equity swap, and warrants were issued with options to
acquire shares that are accounted for at fair value, with changes in value taken through profit and loss.
59
Supply@ME Capital plc
Notes to the Consolidated Financial Statements for the Year Ended 31
December 2020
The release of the fair value discount on the debt for equity swap has been taken direct to retained
earnings.
Equity
"Share capital" represents the nominal value of equity shares issued.
"Share premium" represents the excess over nominal value of the fair value of consideration received
for equity shares net of expenses of the share issue.
"Other reserves" represents legal reserves in respect of Supply@ME S.r.l. In accordance with Article
2430 of the Italian Civil Code, Supply@ME S.r.l., a limited liability company registered in Italy, with a
corporate capital of euro 10,000 or above shall annually allocate as a legal reserve an amount of 5% of
the annual net profit until the legal reserve will be equal to 20% of corporate capital.
“Merger relief reserve” represents the excess of the value of the consideration shares issued to the
shareholders of Supply@ME S.r.l. upon the reverse takeover over the fair value of the assets acquired.
“Reverse takeover reserve” represents the accounting adjustments required to reflect the reverse
takeover upon consolidation. Specifically, removing the value of the “investment” in Supply@ME S.r.l.,
removing the share capital of Supply@ME S.r.l. and bringing in the pre-acquisition equity of Supply
@ME Capital plc.
“FX reserves” represents foreign currency translation differences on consolidation of subsidiaries
reporting under a different functional currency to the parent company.
“Retained earnings” represents retained losses of the group. As a result of the reverse takeover, the
consolidated figures include the retained losses of the Group only from the date of the reverse takeover
together with the brought forward losses of Supply@ME S.r.l.
Critical judgements and significant accounting estimates
In determining and applying accounting policies, judgement is often required in respect of items where
the choice of specific policy, accounting estimate or assumption to be followed could materially affect
the reported results or net asset position of the Group should it later be determined that a different
choice would be more appropriate. The most significant areas where judgement and estimates have
been applied are as follows:
Judgements
The value of warrants for share options were measured, in accordance with IFRS 2, by reference to
their fair value at the date on which they were granted or issued. Judgement was required in determining
the most appropriate valuation model (see Note 16).
At the end of each accounting period the Group assesses the recoverable amounts of intangible assets.
Where there is an indication of impairment an impairment loss is recognised for the amount by which
the assets carrying value exceed its recoverable amount. Impairment losses are recognised in the profit
and loss.
The cost of an internally generated intangible asset comprises all directly attributable costs necessary
to create, produce, and prepare the asset to be capable of operating in the manner intended by
management. Until completion of the development project, the assets are subject to impairment testing
only. Amortisation commences upon completion of the asset and is shown within 'Administrative
Expenses' on the consolidated statement of comprehensive income.
At the end of each period all contracts with customers are reviewed for contracts loss reserves.
60
Supply@ME Capital plc
Notes to the Consolidated Financial Statements for the Year Ended 31
December 2020
At the end of each accounting period, the Group assesses its ability to continue for a period of at least
12 months from the date the consolidated financial statements are approve, by reviewing budgets and
forecasts for future trading years (as noted above in note 2).
An assessment is made whether derivative financial instruments on issue are debt or equity (see note
16).
During the year management made a judgement regarding the recognition of a liability for VAT,
further details can be found in note 18. The potential penalties that could arise on this liability range
between £80k and £360k, management have made a provision at the lower end of the range in line
with professional advice received.
Estimates
Significant assumptions were necessary in arriving at the inputs into the valuation model for modified
and new share option arrangements (see note 16).
3 Reverse acquisition
On 23 March 2020, the Company acquired through a share for share exchange the entire share capital
of Supply@ME S.r.l, whose principal activity is an early stage business that delivers an innovative
technology platform for inventory monetisation that enables a wide range of manufacturing and trading
customers to improve their working capital position by releasing capital from their inventory stock.
Although the transaction resulted in Supply@ME S.r.l. becoming a wholly owned subsidiary of the
Company, the transaction constitutes a reverse acquisition as the previous shareholders of
Supply@ME S.r.l. own a substantial majority of the Ordinary Shares of the Company and the executive
management of Supply@ME S.r.l. became the executive management of Supply@ME Capital plc,
previously Abal Group plc.
In substance, the shareholders of Supply@ME S.r.l. acquired a controlling interest in the Company and
the transaction has therefore been accounted for as a reverse acquisition. As the Company’s activities
prior to the acquisition were purely the maintenance of the AIM Listing, acquiring Supply@ME S.r.l and
raising equity finance to provide the required funding for the operations of the acquisition it did not meet
the definition of a business in accordance with IFRS 3 for the purpose of these consolidated financial
statements of the Group.
Accordingly, in these consolidated financial statements, the reverse acquisition did not constitute a
business combination and was accounted for in accordance with IFRS 2 “Share-based Payments” and
the associated IFRIC guidance. Although, the reverse acquisition is not a business combination, the
Company has become a legal parent and is required to apply IFRS 10 and prepare consolidated
financial statements. The Directors have prepared these consolidated financial statements using the
reverse acquisition methodology, but rather than recognising goodwill, the difference between the equity
value given up by the Supply@ME S.r.l.’s shareholders and the share of the fair value of net assets
gained by the Supply@ME S.r.l. shareholders is charged to the statement of comprehensive income as
a share-based payment on reverse acquisition and represents in substance the cost of acquiring a main
market listing.
In accordance with reverse acquisition accounting principles, these consolidated financial statements
represent a continuation of the consolidated statements of Supply@ME S.r.l. and include:
The assets and liabilities of Supply@ME S.r.l. at their pre-acquisition carrying value amounts and
the results for both years; and
61
Supply@ME Capital plc
Notes to the Consolidated Financial Statements for the Year Ended 31
December 2020
The assets and liabilities of the Company as at 23 March 2020 and its results from the date of the
reverse acquisition (23 March 2020) to 31 December 2020.
On 23 March 2020, the Company issued 32,322,246,220 ordinary shares to acquire the whole of the
share capital of Supply@ME S.r.l. The prospectus dated 4th March 2020 had an issue price of
£0.006945 per share of the Company’s share capital to be issued and therefore valued the investment
in Supply@ME S.r.l. at £224,478,000.
Because the legal subsidiary, Supply@ME S.r.l., was treated on consolidation as the accounting
acquirer and the then legal Parent Company, Supply@ME Capital plc, was treated as the accounting
subsidiary, the fair value of the shares deemed to have been issued by Supply@ME S.r.l. was
calculated at £859,000 based on an assessment of the purchase consideration for a 100% holding of
Supply@ME Capital plc, being its entire share capital of 101,094,276 Ordinary Shares at the last listing
price of £0.0085.
The fair value of the net assets of Supply@ME Capital plc at acquisition was as follows:
Cash and cash equivalents
Receivables
Payables
Total Net Liabilities
£’000
93
50
(660)
(517)
The difference between the deemed cost (£859,000) and the fair value of the net liabilities assumed
per above of £517,000 resulted in £1,376,000 being expensed within “reverse acquisition expenses” in
accordance with IFRS 2, Share Based Payments, reflecting the economic cost to Supply@ME S.r.l.
shareholders of acquiring a quoted entity.
The reverse acquisition reserve which arose from the reverse takeover is made up as follows:
Pre-acquisition equity1
Supply@ME S.r.l. equity at acquisition2
Investment in Supply@ME S.r.l.3
Reverse acquisition expense4
£’000
(14,881)
148
(224,478)
1,376
(237,835)
Notes:
1. Recognition of pre-acquisition equity of Supply@ME Capital plc as at 23 March 2020.
2.
Supply@ME S.r.l. had issued equity of £148,000. As these consolidated financial statements present the capital
structure of the legal parent entity, the equity of Supply@ME S.r.l. is eliminated.
3. The value of the shares issued by the Company in exchange for the entire share capital of Supply@ME S.r.l. The
above entry is required to eliminate the balance sheet impact of this transaction.
4. The reverse acquisition expense represents the difference between the value of the equity issued by the Company,
and the deemed consideration given by Supply@ME S.r.l. to acquire the Company.
62
Supply@ME Capital plc
Notes to the Consolidated Financial Statements for the Year Ended 31
December 2020
4 Deferred revenues and segmental reporting
The revenues do not include accruals and deferred income of £1,131,000 (2019: £634,000) relating to
payments in advance made by client companies for due diligence to pre-qualify them for access to the
inventory monetisation scheme. Under Italian GAAP, these amounts are recognised in revenue in the
year. Under IFRS, these amounts will be recognised in future periods.
The following information is given about the Group’s reportable segments:
The Chief Operating Decision Maker is the Board of Directors. The Board reviews the Group’s internal
reporting in order to assess performance of the Group. Management has determined the operating
segment based on the reports reviewed by the Board.
Type
Due diligence
%
100
Geography
Italy
%
100
The Board considers that during the year ended 31 December 2020 the Group operated in the single
business segment of due diligence services and all activities were undertaken in Italy.
5 Exceptional costs
Year ended
31 December
2020
£ ‘000
Year ended
31 December
2019
£ ‘000
Deemed cost of listing – share-based payment
1,376
-
As explained in note 3, the reverse acquisition of Supply@ME S.r.l. does not meet the requirements of
IFRS 3 Business Combinations so has been accounted for under IFRS 2 Share Based Payments.
The amount of £1,376,000 represents the deemed cost of acquisition over the net assets of
Supply@ME S.r.l. that were acquired. Under IFRS 2, the deemed costs of obtaining the listing has
been expensed to profit and loss.
6 Other operating income
Write back of payables
53
174
Year ended
31 December
2020
£ ‘000
Year ended
31 December
2019
£ ‘000
63
Supply@ME Capital plc
Notes to the Consolidated Financial Statements for the Year Ended 31
December 2020
7 Operating loss
Arrived at after charging / (crediting)
Amortisation
8 Auditors’ remuneration
Fees payable to the Company’s auditors for the audit of the
Company’s annual accounts
Fees payable to the Company’s auditors and its associates for
other services:
Audit of the accounts of subsidiaries
Year ended
31 December
2020
£ 000
Year ended
31 December
2019
£ 000
201
98
Year ended
31 December
2020
£ 000
Year ended
31 December
2019
£ 000
27
10
20
-
9 Staff costs
The aggregate payroll costs (including directors' remuneration) were as follows:
Wages and salaries
Social security costs
Pension costs, defined contribution scheme
Redundancy costs
Year ended
31 December
2020
£ 000
633
95
1
16
745
Year ended
31 December
2019
£ 000
-
-
-
-
-
The average number of persons employed by the Group (including directors) during the year, analysed
by category was as follows:
Executive directors
Risk
Sales and marketing
Legal
Administration
R&D / software
Year ended
31 December
2020
No.
1
1
3
2
5
2
14
Year ended
31 December
2019
No.
-
-
-
-
-
-
-
64
Supply@ME Capital plc
Notes to the Consolidated Financial Statements for the Year Ended 31
December 2020
10 Key management personnel
Key management compensation
Salaries and other short-term employee benefits
Year ended 31
December 2020
£ 000
361
Year ended 31
December 2019
£ 000
-
No retirement benefits are accruing to Company Directors under a defined contribution scheme (2019:
none).
The Directors' emoluments are shown in the remuneration report on pages 33 to 36.
The Directors of the Company and the Head of Enterprise Risk Management are considered to be the
key management personnel.
11 Income tax
Tax charged in the income statement:
Current taxation
UK corporation tax
Foreign taxation paid/(receivable) by subsidiaries
Year ended
31 December
2020
£ 000
Year ended
31 December
2019
£ 000
-
145
145
-
(133)
(133)
The tax on loss before tax for the period is less than (2019 - less than) the standard rate of corporation
tax in the UK of 19% (2019 - 19%).
The differences are reconciled below:
Year ended
31 December
2020
£ 000
Year ended
31 December
2019
£ 000
Loss before tax
Corporation tax at standard rate
Effect of expenses not deductible in determining taxable profit (tax
loss)
Increase in tax losses carried forward which were unutilised in the
current year
Tax adjustments in respect of foreign subsidiaries
Total tax charge/(credit)
2,819
(536)
593
38
50
145
687
(131)
-
-
(2)
(133)
At 31 December 2020 the company had unutilised tax losses of £9,000 (31 December 2019: £9,000).
A deferred tax asset of £2,000 (31 March 2019: £2,000) has not been recognised due to the uncertainty
around the timing of the availability of taxable income to utilise the losses.
65
Supply@ME Capital plc
Notes to the Consolidated Financial Statements for the Year Ended 31
December 2020
12
Earnings per share
The calculation of the Basic earnings per share (EPS) is based on the loss attributable to equity holders
of the parent Company for the year from continuing operations of £2,962,000 (2019 — loss £551,000)
and on a weighted average number of ordinary shares in issue of 27,118,800,563 (2019 —
32,322,246,220). The basic EPS from continuing operations is (0.01) pence (2019 – 0.00).
The comparative equity disclosed in the Consolidated Statement of Financial Position is that of
Supply@ME S.r.l., as disclosed in note 3. The equity of Supply@ME S.r.l. is not in the form of share
capital and therefore the EPS calculation has been based on the consideration shares issued to
complete the RTO.
The diluted EPS is the same as the basic EPS as they were all losses.
13
Intangible assets
Cost or valuation
At 1 January 2019
Additions
At 31 December 2019
Forex retranslation adjustment
At 1 January 2020
Additions
At 31 December 2020
Amortisation
At 1 January 2019
Amortisation charge
At 31 December 2019
Forex retranslation adjustment
At 1 January 2020
Amortisation charge
At 31 December 2020
Carrying amount
At 31 December 2020
At 31 December 2019
66
Capitalised
internally
developed
platform
costs
£ 000
441
132
573
33
606
1,027
1,633
88
95
183
11
194
203
397
1,236
390
Supply@ME Capital plc
Notes to the Consolidated Financial Statements for the Year Ended 31
December 2020
14 Trade and other receivables
Trade receivables
Other receivables
Deferred tax asset
Prepayments
As at 31 December 2020
£ 000
489
601
422
23
As at 31 December 2019
£ 000
4
629
283
3
Total current trade and other receivables
1,535
919
15
Share capital
Allotted, called up and fully paid shares
As at 31 December 2020
£ 000
No. 000
As at 31 December 2019
No. 000
£ 000
Equity
Ordinary shares of £0.00002 each
Deferred shares of £0.04000 each
2018 Deferred shares of £0.01000
each
-
32,754,945
63,084
224,194
33,042,223
-
655
2,523
2,242
5,420
-
-
-
-
-
148
-
-
-
148
The comparative equity is that of Supply@ME S.r.l., as disclosed in note 3. The equity of Supply@ME
S.r.l. is not in the form of share capital so there is no disclosure of the number of shares.
New shares allotted
On 23 March 2020, the Group completed a reverse acquisition transaction with Supply@ME S.r.l. It
was considered that Supply@ME S.r.l. was the accounting acquirer in the transaction and so the
comparative share capital is that of Supply@ME S.r.l. Upon completion of the transaction, the share
capital of Supply@ME Capital plc has been disclosed, to represent that of the legal acquirer.
32,322,246,220 ordinary shares were issued as consideration.
Also, on 23 March 2020, 331,604,094 ordinary shares were issued through a placing which raised gross
proceeds of £2,240,000.
Rights, preferences and restrictions
Ordinary shares have the following rights, preferences and restrictions:
The Ordinary shares carry rights to participate in dividends and distributions declared by the Company
and each share carries the right to one vote at any general meeting. There are no rights of redemption
attaching to the Ordinary shares.
Deferred shares have the following rights, preferences and restrictions:
The deferred shares carry no rights to receive any dividend or distribution and carry no rights to vote at
any general meeting. On a return of capital the Deferred shareholders are entitled to receive the amount
paid up on them after the Ordinary shareholders have received £100,000,000 in respect of each share
held by them. The Company may purchase all or any of the Deferred shares at an appropriate
consideration of £1.
67
Supply@ME Capital plc
Notes to the Consolidated Financial Statements for the Year Ended 31
December 2020
2018 Deferred shares have the following rights, preferences and restrictions:
The deferred shares carry no rights to receive any dividend or distribution and carry no rights to vote at
any general meeting.
Reconciliation of allotted, called up and fully paid shares
As at 31 December 2020
As at 31 December 2019
At 1 January
Transfer to RTO reserve
Bring in plc share capital
Reverse acquisition
Issue of shares for cash
At 31 December
No. 000
-
-
388,373
32,322,246
331,604
33,042,223
£ 000
148
(148)
4,767
646
7
5,420
No. 000
-
-
-
-
-
-
£ 000
148
-
-
-
-
148
16 Share-based payments, convertible loan notes and derivative financial instruments
(1) Convertible loan notes and derivative financial instruments
As at 31 December 2020 two warrants for options to acquire shares were outstanding that arose as
detailed below. These have a fair value of £24,000 (31 December 2019: £48,000). The valuation of the
warrants and further detail to the transactions may be summarised as follows:
(i) In October 2018, following a placing of shares at 1.1p, a warrant was issued for 7,272,727 options to
acquire shares, exercisable for 3 years at 1.1p per share option or, if lower, the 5 day average price on
AIM prior to exercising the option. The year-end fair value of these warrants is 0.21p (31 December
2019: 0.42p) per option to acquire a share and has been calculated using the Black-Scholes model,
and the average 5 - day year-end share price of 0.60p (31 December 2019: 0.85p) giving a total fair
value of £15,000 (31 December 2019: £31,000) for all these options to acquire shares. The other inputs
into the model were volatility 111% (31 December 2019: 111%), dividend yield 0% (31 December 2019:
0%), and risk free rate of 1.1% (31 December 2019: 2.1%).
(ii) In October 2018, a 3 year unsecured convertible loan note (‘CLN’) for £90,000 was issued. The
terms of the CLN was an interest rate of 7.5% pa, and the conversion repayment option was in two
parts — the issue of shares to repay the principal amount of the loan, and a warrant with the option to
purchase additional shares. If the conversion option was exercised, the ordinary shares for the loan
repayment would be issued a price of 1.1p or, if lower, the 5 day average price on AIM prior to exercising
the conversion option. The warrant was for a number of options to acquire shares equal to half the
number of shares issued for the repayment of the loan. The terms of the warrant were for 3 years and
an exercise price of 1.1p or, if lower, the 5 day average price on AIM prior to exercising the warrant
option. In January 2019, the conversion option was exercised. For the repayment of the loan 8,181,818
ordinary shares were issued at a price of 1.1p. On conversion, warrants were issued for options to
acquire 4,090,909 shares, and these warrants were outstanding at both 31 December 2019 and 31
December 2020. For accounting purposes, the CLN on issue was attributed a fair value of £69,000 by
discounting the loan repayments at an unsecured interest rate of 18%. As the Group had no other
comparable unsecured borrowings, higher or lower interest rates might have been applied to calculate
the discount factor, but these would not change materially the fair value of the CLN.
68
Supply@ME Capital plc
Notes to the Consolidated Financial Statements for the Year Ended 31
December 2020
The gain on issue was credited to profit and loss. On exercising the conversion option in January
2019, the release of the £19,000 difference between the carrying value of the loan and the legal value
was credited direct to retained earnings. At the time of exercising this conversion option, the fair value
of share warrants was £33,000 and these warrants were revalued at the year ended 31 December
2020 using the same basis and factors outlined in the previous paragraph 18(2)(i), and giving a total
value for these warrants of £9,000 (31 December 2019: £17,000). The movement in the fair value was
credited to profit and loss.
17
Trade and other payables
Bank loans and overdrafts
Trade payables
Amounts due to group companies
Other payables
Social security and other taxes
Accruals and deferred income
As at 31 December 2020
£ 000
22
1,062
-
271
792
1,248
3,395
As at 31 December 2019
£ 000
297
534
-
220
125
634
1,810
Included within accruals and deferred income is £1,131,000 (2019: £634,000) relating to payments in
advance made by client companies for due diligence to pre-qualify them for access to the inventory
monetisation scheme. Under Italian GAAP, these amounts are recognised in revenue in the year.
Under IFRS, these amounts will be recognised in future periods.
18
Provisions
At 1 January 2019
Provided for in the year
At 31 December 2019
Forex retranslation
adjustment
At 1 January 2020
Released to profit and loss
Provided for in the year
At 31 December 2020
Deferred
tax
liabilities
£’000
-
4
4
Post-
employment
benefits
£’000
-
-
-
Provision
for risks
and
charges
£’000
-
-
-
Provision
for VAT
and
penalties
£’000
-
195
195
-
4
(4)
-
-
-
-
-
32
32
-
-
-
40
40
12
207
-
79
286
Total
£’000
-
199
199
12
211
(4)
151
358
In advance of the Group’s first monetisation transaction, a number of advance payments have been
received from potential client companies in accordance with agreed contractual terms. These advance
payments, for which an invoice has not yet been issued, have been made exclusive of VAT. As at 31
December 2020, the Group has included a provision relating to a potential VAT liability, including
penalties, in respect of these advance payments of £286,000 (31 December 2019: £195,000).
69
Supply@ME Capital plc
Notes to the Consolidated Financial Statements for the Year Ended 31
December 2020
At the point in the future when the associated monetisation transaction takes place, the potential VAT
liability will be settled by the Group. At this same point in time, the Directors expect to be able to
recover the VAT from the client companies as invoices in respect of the monetisation transactions are
issued. The timing of these future monetisation transactions currently remains uncertain and as such
no corresponding VAT receivable has been recognised as at 31 December 2020, however there is a
contingent asset of £204,000 as at 31 December 2020 (31 December 2019: £139,000) in respect of
this.
From time to time, during the course of business, the Group may be subject to disputes which may
give rise to claims. The Group will defend such claims vigorously and provision for such matters are
made when costs relating to defending and concluding such matters can be measured reliably. There
were no cases outstanding as at the year end. Management have been informed of one potential
matter arising subsequent to the year-end however, at this time, this would not meet the criteria for a
provision to be recognised.
19
Pension and other schemes
Defined contribution pension scheme
The Group operates a defined contribution pension scheme. The assets of the scheme are recognised
as being held separately from those of the Group and Company and will be paid over to an
independently administered fund. The pension cost charge represents contributions payable by the
group to the fund.
The total pension charge for the year represents contributions payable by the Group to the scheme and
amounted to £1,000 (2019: £nil).
Contributions totalling £2,000 (2019: £nil) were payable to the scheme at the end of the year and are
included in creditors.
20 Capital commitments
There were no capital commitments for the Group at 31 December 2020 or 31 December 2019.
21 Contingent liabilities
There were no contingent liabilities for the Group at 31 December 2020 or 31 December 2019.
22
Financial instruments
Financial assets
Financial assets at amortised cost:
Cash and cash equivalents
Trade receivables
Other receivables
Carrying value
As at 31
December
2020
£ 000
As at 31
December
2019
£ 000
Fair value
As at 31
December
2020
£ 000
As at 31
December
2019
£ 000
552
489
601
1,642
143
4
629
776
552
489
601
1,642
143
4
629
776
70
Supply@ME Capital plc
Notes to the Consolidated Financial Statements for the Year Ended 31
December 2020
Valuation methods and assumptions: The directors believe that the fair value of all financial assets
approximates to the carrying value
Financial liabilities
Financial liabilities at amortised cost:
Bank loans and overdrafts
Trade payables
Other payables
Carrying value
Fair value
As at 31
December
2020
£ 000
As at 31
December
2019
£ 000
As at 31
December
2020
£ 000
As at 31
December
2019
£ 000
22
1,062
271
1,355
297
534
220
1,051
22
1,062
271
1,355
297
534
220
1,051
Financial liabilities at fair value through profit
and loss:
Derivative financial instruments
Fair value
As at 31
December
2020
£ 000
As at 31
December
2019
£ 000
24
48
Valuation methods and assumptions: The directors believe that the fair value of trade and other
payables approximates to the carrying value – see note 16 for further details of the fair value of
derivative financial instruments.
Risk management
The Group is exposed through its operations to the following financial risks: credit risk, foreign exchange
risk; and liquidity risk.
In common with all other businesses, the Group is exposed to risks that arise from its use of financial
instruments. This note describes the Group's objectives, policies and processes for managing these
risks and the methods used to measure them. Further quantitative information in respect of these
risks is presented throughout these financial statements. There have been no substantive changes in
the Group's exposure to financial instrument risks, its objectives, policies and processes for managing
those risks or the methods used to measure them from previous periods unless otherwise stated in
this note.
Principal financial instruments
The principal financial instruments used by the Group, from which financial instrument risk arises, were
as follows:
- trade receivables;
- cash at bank; and
- trade and other payables.
71
Supply@ME Capital plc
Notes to the Consolidated Financial Statements for the Year Ended 31
December 2020
General objectives, policies and processes
The board had overall responsibility for the determination of the Group's risk management objectives
and policies and, whilst retaining ultimate responsibility for them, it had delegated the authority for
designing and operating processes that ensure the effective implementation of the objectives and
policies to the Group's finance function. The board received monthly reports from the chief Financial
Officer through which it reviewed the effectiveness of the processes put in place and the
appropriateness of the objectives and policies it had set. The overall objective of the board was to set
polices that sought to reduce risk as far as possible without unduly affecting the Group's
competitiveness and flexibility. Further details regarding these policies are set out below.
Interest rate risk
At present the directors do not believe that the Group has significant interest rate risk and consequently
does not hedge against such risk. Cash balances earn interest at variable rates.
The Group's interest generating financial assets as at 31 December 2020 comprised cash at bank of
£552,000 (2019: £142,000). Interest is paid on cash at floating rates in line with prevailing market rates.
As at 31 December 2020, the group had no liabilities for which interest is payable (2019 – no liabilities).
Sensitivity analysis
At 31 December 2020, had the LIBOR 1 MONTH rate of 0.01913 (2019 – 0.70388) increased by 1%
with all other variables held constant, the increase in interest receivable on financial assets would
amount to approximately £nil (2019 - £1,000). Similarly a 1% decrease in the LIBOR 1 MONTH rate
with all other variables held constant would result in a decrease in interest receivable on financial assets
of approximately £nil (2019 - £1,000).
Credit risk and impairment
Credit risk is the risk of financial loss to the group if a customer or a counterparty to a financial instrument
fails to meet its contractual obligations. The Group is mainly exposed to credit risk from credit sales. It
is Group policy, implemented locally, to assess the credit risk of new customers before entering
contracts. Such credit ratings take into account local business practices. The Group has a credit policy
under which each new customer is analysed individually for creditworthiness before the Group's
standard payment and delivery terms and conditions are offered.
Credit risk also arises from cash and cash equivalents and deposits with banks and financial institutions.
To manage this, the Group has made sure that they use reputable banks.
The Group's chief financial officer monitors the utilisation of the credit limits regularly.
The Group’s maximum exposure to credit by class of individual financial instrument is shown in the
table below:
Cash and cash equivalents
Trade receivables
Carrying
value as
at 31
December
2020
£ 000
552
489
1,041
Maximum
exposure
as at 31
December
2020
£ 000
552
489
1,041
Carrying
value as
at 31
December
2019
£ 000
143
4
147
Maximum
exposure
as at 31
December
2019
£ 000
143
4
147
As at 31 December 2020, the assets held by the group are not past due or impaired.
72
Supply@ME Capital plc
Notes to the Consolidated Financial Statements for the Year Ended 31
December 2020
Trade receivables are all considered to be low risk and have been fully repaid since year end.
Foreign exchange risk
Foreign exchange risk arises because the Group has operations located in various parts of the world
whose functional currency is not the same as the functional currency in which the Group operates.
Although its global market penetration reduces the Group's operational risk, in that it has diversified into
several markets, the Group's net assets arising from such overseas operations are exposed to currency
risk resulting in gains or losses on retranslation into sterling. Only in exceptional circumstances would
the group consider hedging its net investments in overseas operations as generally it does not consider
that the reduction in foreign currency exposure warrants the cash flow risk created from such hedging
techniques.
The Group's policy is, where possible, to allow group entities to settle liabilities denominated in their
functional currency (primarily Euros or pound sterling) with the cash generated from their own
operations in that currency. Where group entities have liabilities denominated in a currency other than
their functional currency (and have insufficient reserves of that currency to settle them) cash already
denominated in that currency will, where possible, be transferred from elsewhere within the group.
Currency profile
Financial assets
- Cash Sterling: £539,000 (2019 - £nil)
- Cash Euro: £13,000 (2019 - £143,000)
- Trade receivables Sterling: £nil (2019 - £nil)
- Trade receivables Euro: £489,000 (2019 - £4,000)
Financial liabilities
- Trade payables Sterling: £342,000 (2019 - £nil)
- Trade payables Euro: £720,000 (2019 - £534,000)
Sensitivity analysis
At 31 December 2020, if Sterling had strengthened by 10% against EUR with all other variables held
constant, loss before tax for the year would have been approximately £41,000 lower (2019 - £81,000
lower), mainly as a result of foreign exchange gains on translation of EUR denominated cash and cash
equivalents and trade receivables, compensated by foreign exchange gains on translation of EUR
denominated trade payables and deferred revenues.
Conversely, if Sterling had weakened by 10% against EUR with all other variables held constant, loss
before tax for the year would have been approximately £41,000 higher (2019 - £81,000 higher).
Liquidity risk
Liquidity risk arises from the Group's management of working capital and the finance charges and
principal repayments on its debt instruments. It is the risk that the Group will encounter difficulty in
meeting its financial obligations as they fall due.
The Group's policy is to ensure that it will always have sufficient cash to allow it to meet its liabilities
when they become due.
The board receives rolling 12-month cash flow projections on a regular basis as well as information
regarding cash balances. At the statement of financial position date, these projections indicated that
the group expects to have sufficient liquid resources to meet its obligations under all reasonably
expected circumstances.
There were no undrawn facilities at 31 December 2020 or 31 December 2019.
73
Supply@ME Capital plc
Notes to the Consolidated Financial Statements for the Year Ended 31
December 2020
At 31 December 2020
Liabilities
Loans and borrowings
Trade and other payables
Social security and other taxes
Total liabilities
At 31 December 2019
Liabilities
Loans and borrowings
Trade and other payables
Social security and other taxes
Total liabilities
Up to 3
months
£ 000
Between
3 and 12
months
£ 000
Between
1 and 2
years
£ 000
Between
2 and 5
years
£ 000
Over 5
years
£ 000
22
1,333
792
2,147
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Up to 3
months
£ 000
Between
3 and 12
months
£ 000
Between
1 and 2
years
£ 000
Between
2 and 5
years
£ 000
Over 5
years
£ 000
297
754
125
1,176
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Capital risk management
The Group's capital management objectives are to ensure the Group is appropriately funded to continue
as a going concern and to provide an adequate return to shareholders commensurate with risk. The
Group defines capital as being total shareholder’s equity. The Group has no external debt finance and
hence gearing is not measured. The Group's capital structure is periodically reviewed and, if
appropriate, adjustments are made in the light of expected future funding needs, changes in economic
conditions, financial performance and changes in Group structure.
The Group adheres to the capital maintenance requirements as set out in the Companies Act.
Capital for the reporting periods under review is summarised as follows:
- Net liabilities: (£452,000) (2019: (£557,000))
- Cash and cash equivalents: £552,000 (2019: £143,000)
23 Net debt
The Group reconciliation of the movement in net debt is set out below:
Cash at bank
Bank overdraft
At 1
January
2020 Cashflows
£ 000
£ 000
143
-
143
407
(22)
385
Foreign
exchange
£ 000
At 31
December
2020
£ 000
24
-
24
574
(22)
552
74
Supply@ME Capital plc
Notes to the Consolidated Financial Statements for the Year Ended 31
December 2020
Cash at bank
Bank overdraft
At 1
January
2019 Cashflows
£ 000
£ 000
Foreign
exchange
£ 000
At 31
December
2019
£ 000
4
(2)
2
139
2
141
-
-
-
143
-
143
24 Related party transactions
During the year to 31 December 2020, the following are treated as related parties:
The AvantGarde Group SpA
The AvantGarde Group currently holds 38.9 per cent of the shares in Supply@ME Capital plc as
announced on 24 December 2020.
In the same RNS, the Company disclosed, among things, a merger between 1AF2 S.r.l. and the
AvantGarde Group S.p.A. (TAG). The merged company will be named “the AvantGarde Group”. 1AF2
S.r.l. was a Company, with Alessandro Zamboni as Director, also involved, together with Quadrivio
Group in the “Captive Bank” project as per RNS published by SYME on 21 September 2020. In this
regard, 1AF2 S.r.l. originated in 2020 several Client companies analysed by Supply@ME S.r.l. and to
which SYME charged due diligence fees, pursuant to its revenue recognition policies.
Following the above transaction between IAF2 and the AvantGarde Group S.p.A., as at 31 December
2020 the amount due to the Company is £485,339 (2019: due by the Company £204,887)
iWEP Ltd is owned by iWolf Ltd and White Amba Investments LLP
The beneficial owner of iWEP, iWolf and White Amba is Dominic White, the Chairman of SYME.
Eight Capital Partners Plc
Dominic White is a Director of the company. IWEP owns 29.8% of Eight Capital Partners Plc.
Epsion Capital Ltd
Epsion Capital, is a wholly owned subsidiary of Eight Capital Partners Plc and conducted the placing
for the RTO.
Dominic White
Dominic White holds directorships across these companies that are therefore related parties (iWEP Ltd,
iWolf Ltd, White Amba Investments LLP and Eight Capital Partners Plc).
Alessandro Zamboni
Alessandro Zamboni is on the Board of The AvantGarde Group SpA as well as holding numerous
directorships across companies that are related parties.
25 Controlling party
At 31 December 2020 the Directors do not believe that a controlling party exists.
75
Supply@ME Capital plc
Notes to the Consolidated Financial Statements for the Year Ended 31
December 2020
26
Subsequent events
In the first six months of 2021, the Company announced the following material events:
11 January 2021: SYME announced that it has entered into an agreement with Lenovo
Financial Services META LLC (“LFS”). The SYME Platform will be positioned as an alternative
solution to complement LFS’s existing vendor programme offerings to their network of
customers in the Middle East, Turkey and Africa region (excluding South Africa).
The purpose of the co-operation agreement, made with the strategic support of iMASS, was to
deliver a dedicated inventory monetisation programme to LFS’s customers which may also
allow them to evaluate the opportunity to adopt the upcoming Shariah version of the Platform.
20 January 2021: following the announcement of 3 November 2020, the Company, by virtue
of the support of the Shariah Funding Specialist and iMASS, announced that the authorisation
process for SYME’s Shariah compliant Inventory Monetisation Platform was successfully
completed.
21 January 2021: further to the Company’s announcement of 19 January, 2021, detailing a
change to its Accounting Reference Date to 31 December and a revised financial reporting
calendar, SYME requested a suspension of the listing of its shares pending publication of its
audited accounts for the nine months to 31 December 2019 and its 2020 Interim Results for the
six months ended 30 June.
9 March 2021: Restoration of its Listing on the Standard List of The London Stock Exchange
and the resumption of dealings in its Ordinary shares.
17 March 2021: SYME announced on 17 March 2021 the signing of Heads of Terms (“HoT”)
for the acquisition of TradeFlow Capital Management Pte Ltd., the leading FinTech-powered
commodities trade enabler, focused on SMEs, based in Singapore.
A sale and purchase agreement was signed and announced on 26 May 2021. The transaction
is expected to complete shortly.
1 April 2021: The Company announced the appointment of Ms Amy Benning as Chief Financial
Officer with effect from 7 June 2021.
16 June 2021: The Company announced that it had entered into a subscription agreement
(“Subscription Agreement”) with Negma Group Ltd for the issue of an initial tranche of
£5,600,000 of Convertible Loan Notes at £56,000 par value for which it had issued a drawdown
notice at a subscription price of £50,000 per Convertible Loan Note for an aggregate total of
£5,000,000. The Subscription Agreement allows for a further nine tranches to be issued at the
same par value at the exclusive option of the Company.
76
Supply@ME Capital plc
Company Statement of Financial Position as at 31 December 2020
Non-current assets
Property, plant and equipment
Investments
Total non-current assets
Current assets
Trade and other receivables
Cash and cash equivalents
Total current assets
Total assets
Current liabilities
Trade and other payables
Derivative financial instruments
Total current liabilities
Net assets/(liabilities)
Equity attributable to owners of the parent
Share capital
Share premium
Retained earnings
Total equity
As at 31
December 2020
£ 000
As at 31
December 2019
£ 000
Note
3
4
7
6
5
5
2
646
648
282
539
821
1,469
894
24
918
551
5,420
11,820
(16,689)
551
-
-
-
67
81
148
148
409
48
457
(309)
4,767
9,599
(14,675)
(309)
A separate income statement for the parent company has not been presented, as permitted by section
408 of the Companies Act 2006. The Company’s loss for the year was £2,014,000 (2019: profit for the
period 1 April 2019 to 31 December 2019 of £532,000).
The notes on pages 79 to 85 form an integral part of these financial statements.
The Company financials on pages 77 to 85 were approved and authorised for issue by the Board on 25
June 2021 and signed on its behalf by:
.........................................
Mr Alessandro Zamboni
Director
Supply@ME Capital plc
Registration number: 03936915
77
Supply@ME Capital plc
Company Statement of Changes in Equity for the Year Ended 31 December 2020
At 1 April 2019
Loss for the period
Employee share-based payment options
Total comprehensive loss for the period
Share capital
£ 000
Share premium
£ 000
Other reserves
£ 000
Retained
earnings
£ 000
Total
£ 000
4,767
9,599
1,217
(15,207)
-
-
-
-
-
-
-
(1,217)
(1,217)
(685)
1,217
532
376
(685)
-
(685)
At 31 December 2019
4,767
9,599
At 1 January 2020
Loss for the year
Total comprehensive loss for the period
Reverse takeover of Supply@ME S.r.l.
Issue of shares for cash
Cost of share issues
Share capital
£ 000
Share premium
£ 000
Other reserves
£ 000
4,767
9,599
-
-
646
7
-
-
-
-
2,234
(13)
At 31 December 2020
5,420
11,820
The notes on pages 79 to 85 form an integral part of these financial statements.
78
-
-
-
-
-
-
-
-
(14,675)
(309)
Retained
earnings
£ 000
Total
£ 000
(14,675)
(309)
(2,014)
(2,014)
-
-
-
(2,014)
(2,014)
646
2,241
(13)
(16,689)
551
Supply@ME Capital plc
Notes to the Company Financial Statements for the Year Ended 31 December
2020
1 General information
Supply@ME Capital plc (the “Company” or “SYME”) is a public company limited by share capital
incorporated and domiciled in England. The address of its registered office is 27/28 Eastcastle Street,
London WlW 8DH. The Company's ordinary shares are traded on the Main Market of the London Stock
Exchange.
These financial statements are the separate financial statements for the Company and have been
prepared in compliance with Financial Reporting Standard 102, the Financial Reporting Standard
applicated in the United Kingdom and the Republic of Ireland (“FRS 102”) and the Companies Act 2006.
In order to simplify the accounting for the parent company this is the first year in which the financial
statements have been prepared in compliance with FRS 102. The transition from preparing the financial
statements in accordance with International Financial Reporting Standard to FRS 102 has had no
material impact on either the financial position or the financial performance as previously reported by
the company.
The Company’s financial statements are presented in Pounds Sterling, the Company’s functional and
presentational currency, and all values are rounded to the nearest thousand pounds (£’000) excepted
when otherwise stated.
These financial statements have been prepared under the historical cost convention, modified to include
certain financial instruments at fair value. The principal accounting policies are set out below, which
have been consistently applied to all the years presented. The comparative period for the Company
is 1 April 2019 to 31 December 2019 being the results of Supply@ME Capital plc.
As permitted by FRS 102 section 1.12, the Company has taken advantage of the disclosure exemptions
available under that standard in relation to:
Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes
and disclosures;
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues’:
Carrying amounts, interest income/expense and net gains/losses for each category of financial
instrument; basis of determining fair values; details of collateral, loan defaults or breaches,
details of hedges, hedging fair value changes recognised in profit or loss and in other
comprehensive income;
Section 26 ‘Share based Payment’: Share-based payment expense charged to profit or loss,
reconciliation of opening and closing number and weighted average exercise price of share
options, how the fair value of options granted was measured, measurement and carrying
amount of liabilities for cash-settled share-based payments, explanation of modifications to
arrangements;
Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The parent company meets the definition of a qualifying entity under FRS 102. Where required,
equivalent disclosures are given in the Group accounts of Supply@ME Capital plc.
Supply@ME Capital plc is the parent company of the Group and its results are included in the
consolidated financial statements on pages 49 to 76.
79
Supply@ME Capital plc
Notes to the Company Financial Statements for the Year Ended 31 December
2020
2 Accounting policies
Going concern
These financial statements have been prepared on a going concern basis, under historical cost
convention. The Directors have assessed the Company’s ability to continue in operational existence
for the foreseeable future and consider it appropriate to continue to prepare these financial statements
on a going concern basis.
The full going concern assessment of the Group, being the Company and its subsidiaries, has been set
out in note 2 to the Group consolidated financial statements.
Investments in subsidiaries
Subsidiaries are all entities over which the Company has control. The Company controls an entity
when the Company 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 value of the acquisition of Supply@ME S.r.l. as shown in the accounts of the holding company has
been determined by applying the sections 610, 612 and 615 of the Companies Act 2006 as they relate
to merger relief. These sections of the Companies Act 2006 are applicable to corporate investments
where more than 90% of the acquired entity is represented by a share for share exchange, as occurred
with the acquisition of Supply@ME S.r.l. In this instance FRS 102 allows the investment to be carried
in the Company’s balance sheet at the nominal value of the shares issued, ignoring any associated
share premium.
The carrying value referred to above is then adjusted by any provision for impairment in the value.
Where events or changes in circumstances indicate that the carrying value of an investment may not
be recoverable, an impairment review is carried out. An impairment write down is recognised to the
extent that the carrying value of the investment exceeds the higher of fair value less costs to sell and
value in use.
Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and other short-term highly liquid investments that
are readily convertible to a known amount of cash and are subject to an insignificant risk of change in
value.
Financial assets
Classification
Financial assets currently comprise trade and other receivables, cash and cash equivalents.
Recognition and measurement
Loans and receivables
Loans and receivables are mainly contractual trade receivables and are non-derivative financial assets
with fixed or determinable payments that do not have a significant financial component and are not
quoted in an active market. Accordingly, trade and other receivables are recognised at undiscounted
invoice price. A reserve for credit risk is made at the beginning of each transaction and adjusted
subsequently through profit and loss.
Cash and cash equivalents
Cash and other short-term deposits in the Statement of Financial Position comprise cash at banks and
in hand and short-term deposits with an original maturity of three months or less and where there is an
insignificant risk of changes in value.
Impairment of financial assets
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators
of impairment at each reporting end date. Financial assets are impaired where there is objective
80
Supply@ME Capital plc
Notes to the Company Financial Statements for the Year Ended 31 December
2020
evidence that, as a result of one or more events that occurred after the initial recognition of the financial
asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss
is the difference between the carrying amount and the present value of the estimated cash flows
discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or
loss. If there is a decrease in the impairment loss arising from an event occurring after the impairment
was recognised, the impairment is reversed. The reversal is such that the current carrying amount does
not exceed what the carrying amount would have been, had the impairment not previously been
recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset
expire or are settled, or when the Company transfers the financial asset and substantially all the risks
and rewards of ownership to another entity, or if some significant risks and rewards of ownership are
retained but control of the asset has transferred to another party that is able to sell the asset in its
entirety to an unrelated third party.
Financial liabilities
Classification
Financial liabilities comprise trade and other payables, convertible loan notes and derivative financial
instruments.
Recognition and measurement
Trade and other payables
Trade and other payables are initially recognised at fair value less transaction costs and thereafter
carried at amortised cost.
Derivative financial instruments
The Company’s derivative financial instruments are a convertible loan note that was both issued and
then cleared in the previous period year by a debt for equity swap, and warrants were issued with
options to acquire shares that are accounted for at fair value, with changes in value taken through profit
and loss. The release of the fair value discount on the debt for equity swap has been taken direct to
retained earnings.
Derecognition of financial liabilities
Financial liabilities are derecognised when the Company’s contractual obligations expire or are
discharged or cancelled.
Equity
"Share capital" represents the nominal value of equity shares issued.
"Share premium" represents the excess over nominal value of the fair value of consideration received
for equity shares net of expenses of the share issue.
“Retained earnings” represents retained losses of the Company.
Foreign currency transactions
Foreign currency transactions are translated into the functional currency using the average exchange
rates in the month. Foreign exchange gains and losses resulting from the settlement of such
transactions, and from the translation at the reporting period end exchange rates of monetary assets
and liabilities denominated in foreign currencies, are recognised in the statement of comprehensive
income.
Critical judgements and significant accounting estimates
In determining and applying accounting policies, judgement is often required in respect of items where
the choice of specific policy, accounting estimate or assumption to be followed could materially affect
the reported results or net asset position of the Company should it later be determined that a different
81
Supply@ME Capital plc
Notes to the Company Financial Statements for the Year Ended 31 December
2020
choice would be more appropriate. The most significant areas where judgement and estimates have
been applied are as follows:
Judgements
The value of warrants for share options were measured, in accordance with FRS 102 section 26, by
reference to their fair value at the date on which they were granted or issued. Judgement was required
in determining the most appropriate valuation model (see Note 7).
At the end of each accounting period, the Company assesses its ability to continue for a period of at
least 12 months from the date the financial statements are approved, by reviewing budgets and
forecasts for future trading years (as noted above in note 2).
An assessment is made whether derivative financial instruments on issue are debt or equity (see note
7).
At the end of the accounting period the Company assesses if there are any indicators of impairment
with respect to its investments in subsidiaries. The carrying value as at 31 December 2020 was
supported by a discounted cash flow model of future free cash flows. The Directors have reviewed the
valuation based on current knowledge and projections. They have concluded that the current carrying
value is supported by the present value of future free cash flows and that no impairment of the
investment is required.
Estimates
Significant assumptions were necessary in arriving at the inputs into the valuation model for modified
and new share option arrangements (see note 7).
3
Investments
Details of undertakings
Details of the investments in which the Company holds 20% or more of the nominal value of any class
of share capital are as follows:
Undertaking
Country of
incorporation
Holding
Subsidiary undertakings
Supply@ME S.r.l.
Italy
Legal
capital
Proportion
of voting
rights and
shares held
2020
100%
Proportion
of voting
rights and
shares
held
2019
-
Abal (Goswell) Limited
England and Wales Ordinary
0%
100%
Supply@ME Stock Company 1
S.R.L
Supply@ME Stock Company 2
S.R.L
Supply@ME Stock Company 3
S.R.L
Italy
Italy
Italy
shares
Legal
capital
Legal
capital
Legal
capital
100%
100%
100%
-
-
-
Supply@ME S.r.l. is the Group’s main operating company engaged in inventory monetisation.
The business and assets of Abal (Goswell) Limited were sold in February 2019, and the company was
dissolved in November 2020. The investment of £1 has been disposed of in the year.
82
Supply@ME Capital plc
Notes to the Company Financial Statements for the Year Ended 31 December
2020
Investments
As at 1 April 2019
As at 31 December 2019
As at 1 January 2020
Additions at cost
Disposals
As at 31 December 2020
Subsidiary
undertakings
£ 000
-
-
-
646
-
646
On 23 March 2020, the Company issued 32,322,246,220 ordinary shares to acquire the whole of the
share capital of Supply@ME S.r.l. These shares had a nominal value of £0.00002 per share and an
issue price of £0.006945 per share. As outlined in note 2 above the value of the acquisition of
Supply@ME S.r.l. has been determined by applying the sections 610, 612 and 615 of the Companies
Act 2006 as they relate to merger relief. These sections of the Companies Act 2006 are applicable to
corporate investments where more than 90% of the acquired entity is represented by a share for share
exchange, as occurred with the acquisition of Supply@ME S.r.l. In this instance FRS 102 requires the
investment to be carried in the Company’s balance sheet at the nominal value of the shares issued,
ignoring any associated share premium.
The fair value of the investment has been reviewed for impairment. The carrying value as at 31
December 2020 was supported by a discounted cash flow model of future free cash flows. The Directors
have reviewed the valuation based on current knowledge and projections. They have concluded that
the current carrying value is supported by the present value of future free cash flows and that no
impairment of the investment is required.
4
Trade and other receivables
Trade receivables
Other receivables
Prepayments
As at 31 December 2020
£ 000
-
260
22
As at 31 December 2019
£ 000
-
67
-
Total current trade and other receivables
282
67
5
Share capital
Allotted, called up and fully paid shares
Ordinary shares of £0.00002 each
Deferred shares of £0.04000 each
2018 Deferred shares of £0.01000
each
As at 31 December 2020
£ 000
As at 31 December 2019
No. 000
101,095
63,084
224,194
388,373
£ 000
3
2,523
2,241
4,767
655
2,523
2,242
5,420
No. 000
32,754,945
63,084
224,194
33,042,223
83
Supply@ME Capital plc
Notes to the Company Financial Statements for the Year Ended 31 December
2020
New shares allotted
On 23 March 2020, the Group completed a reverse acquisition transaction with Supply@ME S.r.l.
Upon completion of the transaction, the share capital of Supply@ME Capital plc has been disclosed, to
represent that of the legal acquirer. 32,322,246,220 ordinary shares were issued as consideration.
Also, on 23 March 2020, 331,604,094 ordinary shares were issued through a placing which raised gross
proceeds of £2,240,000.
Rights, preferences and restrictions
Ordinary shares have the following rights, preferences and restrictions:
The Ordinary shares carry rights to participate in dividends and distributions declared by the Company
and each share carries the right to one vote at any general meeting. There are no rights of redemption
attaching to the Ordinary shares.
Deferred shares have the following rights, preferences and restrictions:
The deferred shares carry no rights to receive any dividend or distribution and carry no rights to vote at
any general meeting. On a return of capital the Deferred shareholders are entitled to receive the amount
paid up on them after the Ordinary shareholders have received £100,000,000 in respect of each share
held by them. The Company may purchase all or any of the Deferred shares at an appropriate
consideration of £1.
2018 Deferred shares have the following rights, preferences and restrictions:
The deferred shares carry no rights to receive any dividend or distribution and carry no rights to vote at
any general meeting.
6 Share-based payments, convertible loan notes and derivative financial instruments
(1) Convertible loan notes and derivative financial instruments
As at 31 December 2020 two warrants for options to acquire shares were outstanding. These have a
fair value of £24,000 (31 December 2019: £48,000). Further details about these warrants and their
valuation are set out in note 16 to the Group consolidated financial statements.
7
Trade and other payables
Bank loans and overdrafts
Trade payables
Amounts due to group companies
Other payables
Social security and other taxes
Accruals and deferred income
As at 31 December 2020
£ 000
-
342
331
51
53
118
895
As at 31 December 2019
£ 000
-
303
-
45
3
58
409
8
Related party transactions
The Company has taken advantage of the exemption under FRS 102:33.1A from disclosing
transactions with other, wholly owned members of the Group.
84
Supply@ME Capital plc
Notes to the Company Financial Statements for the Year Ended 31 December
2020
A full list of the Company’s subsidiaries and related party transactions are set out in note 24 to the
Group consolidated financial statements.
9
Controlling party
At 31 December 2020 the Directors do not believe that a controlling party exists.
10
Subsequent events
A full list of the Company’s subsequent events are set out in note 26 to the Group consolidated financial
statements.
85