Supply@ME has launched its
unique Inventory Monetisation
services and agreed its first
White-Label commitment
Annual Report and Accounts 2023
Supply@ME’s business model
is unique and learning through
the challenges presented
during 2023 will enable the
business to serve a greater
range of client business models
and inventory funder appetites
Contents
Chairman’s Statement
Chief Executive Officer’s Statement
Supply@ME Inventory Monetisation – Key Features
Strategic Report
4 Highlights
6
7
8
9 Our Delivery Model
13 How we adapt to scale the business
15 How we follow the tokenisation trend
17 Serviceable Obtainable Market
20 Case study - Retreading
21 Key strategic priorities
29 Our Team
32 Our Leadership Team
34 Team Q&A
36 Engaging with our Stakeholders
38 Financial Review
46 Environmental, Social and Governance Review
48 Task Force on Climate-Related Financial Disclosures
50 Principal Risks and Uncertainties
Corporate Governance Report
62 Corporate Governance Introduction
63 Directors’ Information
71 Statement of Compliance with the QCA Corporate
Governance Code
75 Report of the Nomination Committee
78 Report of the Audit Committee
85 Directors’ Remuneration Report
108 Report of the Directors
Company registration number: 03936915
Financial Statements
116 Independent Auditor’s Report
121 Consolidated Statement of Comprehensive Income
122 Consolidated Statement of Financial Position
123 Consolidated Statement of Changes in Equity
125 Consolidated Statement of Changes in Cash Flows
127 Notes to the Consolidated Financial Statements
177 Company Statement of Financial Position
178 Company Statement of Changes in Equity
179 Notes to the Company Financial Statements
Information
197 Company information
198 Glossary
Strategic
Report
Highlights
During 2022 Supply@ME demonstrated that the concept of
Inventory Monetisation (“IM”) works. Building on this
progress, during 2023 and early 2024 the business has
continued to learn and develop its track record. This had
been demonstrated by the first traditional monetisation of
inventory in Italy and the signing of an agreement for
monetisation of inventory in the UK. The strategic
partnership with the a group of private investors and subject
matter experts of working capital solutions to launch an
independent Swiss-based trading business (“CH Trading
Hub”) and the secured commitment of USD$5 million from
an asset manager specialised in digital assets to start the
overall US$100 million security token also demonstrates
progress. In addition, the Group has successfully agreed
the first White-Label commitment with Banco BPM S.p.A
(“BBPM”) to fund up to €10 million of an existing client’s
inventory, launching a new revenue stream for the
Company. This is complimented by the recent
announcement of the relationship between Supply@ME and
an Italian neo bank to provide funding, initially for €35 million
as part of an overall programme up to €135 million, of
inventory in relation to the Supply@ME Italian client pipeline.
This Annual Report and Accounts for the year ended 31
December 2023 (the “Annual Report and Accounts”)
explains the foundations which have been established to
enable delivery of the business model to clients with a
wide range of inventory through of the development of
methodologies across varying business models. It will also
highlight the opportunities available through the
development of our delivery model in collaboration with
the CH Trading Hub and the possibilities available through
traditional and non-traditional funding routes. Taking
these factors together, the Board believes this outlines
why the Group’s current financial performance does not
demonstrate its longer-term potential.
Financial KPIs
Total revenue from continuing
operations
Adjusted operating (loss) from
continuing operations*
(Loss) before tax from continuing
operations
£0.2m
(£3.6m)
(£4.2m)
£0.1m in 2022
(£4.6m) in 2022
(£7.7m) in 2022
(Loss) from discontinued
operations
(£0.2m)
Total Group assets
Total Group net (liabilities)
£2.2m
(£3.8m)
(£2.2m) in 2022
£8.3m at 31 December 2022
(£2.0m) at 31 December 2022
*Adjusted operating loss is the operating loss from continuing operations before impairment charges and fair value adjustments.
4 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
4 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Operational KPIs
Warehoused goods monetisation pipeline at 19 April 2024
£ 330.7 m
£374.6m at 21 April 2023
The pipeline KPI represents the current potential value of
warehoused goods inventory to be monetised rather than
pipeline revenue expected to be earned by the Group. As
such, this provides a good indicator of the level of demand
for the Group’s warehoused goods monetisation services.
This pipeline represents the value as at the most
practicable date possible prior to the issue of this annual
report (being 19 April 2024). and has been calculated on a
consistent basis as the prior year comparative. It should
be noted that of the current pipeline figure of £330.7
million, there is one single client that accounts for
approximately 57% of the total pipeline.
As referenced in the business, trading and funding update
announcement issued by the Company on 29 February
2024, the Group is in the process of conducting a full
review of its pipeline and is progressing with requesting a
formal letter of interest from each client company in its
pipeline for which there is currently not a signed term
sheet in place. As at 19 April 2024, approximately 9% of
the £330.7 million current pipeline figures are supported
by either signed term sheets or the signed new letter of
interest. This percentage is expected to grow as the new
process becomes fully embedded.
5 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
5 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Chairman’s Statement
Dear Shareholders,
I am pleased to share this statement after my first full year
as Chair of Supply@ME. The reasons I joined the Company
continue to hold true, the passion and enthusiasm of the
team and desire to help Supply@ME with its mission of
unlocking barriers for investors to be able to fund inventory
and ultimately help businesses access a new type of working
capital solution.
The unique solution which Supply@ME offers is starting to
gain traction in the market which is demonstrable by the
tangible progress made during 2023 of the first traditional
Inventory Monetisation being executed in Italy. A further
such transaction was also fully contracted with the first
UK Company during 2023, albeit there has been a delay
in execution of this transaction largely as a result of the
Inventory Monetisation being managed alongside an existing
floating charge facility which has required this client company
to gain specific waivers from existing lenders. While this
has resulted in delay to completing the deal, it nonetheless
serves as further proof an IM transaction model can work
in the UK, including alongside existing financing facilities. To
deliver the first IM transactions the Group has connected
through its IM Platform the client company, inventory
funder and stock company to facilitate the execution of
the IM transactions. This in itself requires confidence from
all stakeholders in the accountancy, legal and technology
frameworks and internal processes designed to facilitate
Inventory Monetisation transactions over the Platform. I look
forward to seeing both the client and inventory funder base
grow as the model begins to scale.
The increased interest in tokenisation of assets is an area
of opportunity for Supply@ME, which will be discussed
in more detail in this year’s Annual Report and Accounts.
The viability of tokenisation of inventory had already been
demonstrated by the Group’s strategic partnership with
VeChain Foundation (“VE Chain”) and was further solidified
by the progress made in structuring a security token
framework with the CH Trading Hub, owned by Société
Financière Européenne S.A. (“SFE”), which will allow a first
security token issuance up to USD$100 million to be
subscribed in tranches, largely by institutional investors who
are active in the digital asset markets.
A significant milestone for the Company has been the
signing of the first White-Label commitment from BBPM to
fund up to €10 million of inventory of an existing client of
the bank. This in my view will open up an additional market
for the Supply@ME Platform and will create the opportunity
for the Group to work closely with a range of financial
institutions and their existing client base using the Group’s
unique model. The agreement with BBPM also recognises
the deep expertise of the team as inventory servicing
specialists.
Despite the positive steps set out above, 2023 has not been
without it challenges, the Board and team have invested a
significant amount of time focusing on ensuring the Group has
sufficient funding to realise its potential, potential which is not
representative of either the financial results or the diminishing
share price during 2023. I would like to take the opportunity
to thank our shareholders for their continued support and
appreciation of the potential of our unique product.
I am excited about the
prospects for 2024, we have
a market relevant product,
which is gaining recognition
and interest, a strong team
who have pulled together
to weather some challenging
waters and I look forward to seeing
the Supply@ME Group reach its large
addressable market.
Albert Ganyushin,
Chairman
30 April 2024
6 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Chief Executive Officer’s Statement
During 2023 and early 2024 Supply@ME has developed an
alternative IM infrastructure through collaboration with a
group of private investors and subject matter experts of
working capital solutions to launch the CH Trading Hub, to
replace the GIF. The CH Trading Hub, owned by SFE, is
assuming control of the independent stock companies
from the GIF to manage the overall trading businesses
using the Platform and the associated inventory servicer
activities provided by the Group. This structure is designed
to enable us to scale the offering of the Group as specialist
inventory servicer with a stable partner in the CH Trading
Hub. We share more detail about this structure in the Our
Delivery Model section of this report on pages 9–12.
Additionally, the CH Trading Hub will handle the token route.
In this regard, the Group is studying together with VE Chain
how to implement the phase 2 within the signed strategic
agreement and it is working with the CH Trading Hub to
launch a security token framework which will allow up to
US$100m to be issued and subscribed, mostly by
institutional investors active in the digital asset markets. The
security token is expected to be issued by a vehicle
sponsored by SFE and be tradeable on authorised digital
asset exchanges. The first tranche of this can be seen by the
recent announcement of a secured commitment of USD$5
million from an asset manager specialised in digital assets.
Despite the positive steps set out above, 2023 was a
challenging year for the Company from a funding
perspective, which has impacted the team. I want to take
this opportunity to thank the Board and the Supply@ME
team for their ongoing support and commitment to our
unique product. I am proud of how the team has
collaborated to navigate these challenges and the
unwavering commitment shown to creating our Inventory
Monetisation product.
I am excited to take the Group forward into 2024, we are
focused on continuing to evolve the processes,
technologies and methodologies which support our
various client’s business models and inventory types, see
pages 13–14 for more detail, and ultimately create a new
market for inventory funding. Whether that be through
Open Market Inventory Monetisations, tokenisation of
inventory as an asset and democratisation of the sale of
this through digital asset exchanges, or White-Label
transactions with financial institutions, the progress that is
being steadily made should start to show through the
expansion of our track record and our ability to first break
even and then to scale.
Dear Shareholders,
In 2022 we proved the Supply@ME model through
conducting the first IM transaction using funds from a
non-fungible token (“NFT”) issuance. From the work that the
team and I have conducted during 2023 and to date in 2024, I
strongly believe there continue to be huge opportunities for
the applicability for our model through tokenisation which will
be discussed in this year’s Annual Report and Accounts.
Following the inaugural IM transaction, we continued the
progress into 2023 and have taken the IM model to
institutional investors. Firstly, through the Open Market
Inventory Monetisations taking place that were
announced during 2023, and the agreement with the
Italian neo bank recently announced. Secondly, by the
accumulation of work conducted during the year which
resulted in the signing of the White-Label commitment
from BBPM to deliver inventory funding to an existing
client of BBPM through our IM Platform. The significance
of the engagement of institutional investors and highly
reputable banks in these transactions cannot be
understated. It demonstrates the credibility of the model
we have been working to develop.
We made changes to our business model during 2023 in
recognition of the evolution of the regulation of the fund
management industry and to cater to the needs of potential
inventory funders who wanted to see a segregated structure
of the Platform provider, the Supply@ME Group and the
investment adviser, previously TradeFlow Capital Management
Pte. Limited (“TradeFlow”) and their Cayman-based global
inventory fund (“GIF”). This separation came about as the result
of the disposal of the 81% stake in the TradeFlow business
which was completed on 30 June 2023 (the “TradeFlow
Restructuring”). The TradeFlow Restructuring is
expected to create value for shareholders by
eliminating any perception of conflicts of interest
between the two businesses and providing
both businesses with greater commercial
opportunities through the clear differentiation of
responsibilities of the individual entities.
Alessandro Zamboni,
Chief Executive Officer
30 April 2024
7 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
7 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Supply@ME Inventory Monetisation – Key Features
Supply@ME is disrupting the industry with its unique
model. Not only does it offer a new approach to businesses
with cash flow needs, but it is doing so at a much more
competitive rate than traditional lenders. Outlined below
are some of the ways in which Supply@ME offers a more
complete, flexible service, that reflects client’s needs than
traditional inventory funders or other competitors.
Supply@ME
Traditional
inventory funders
Other
competitors
Purely focused on inventory
Non-credit approach
Non-intrusive of other financing options
Legal true sale
Platform based
Supply chain resilience enabler
Quick initial yes or no
Initial amount subject to due diligence
Fixed due diligence fee and timescale
Revolving facility
Cross border
Event led independent valuations
Positive impact on key ratios
Tax deductible costs
With fewer drawbacks or restrictions
Linked to other facilities on the balance sheet
Debt facility
Interest payable
Security taken on Inventory or other assets
Covenants in place
Management accounts and borrowing base certificates
Use of funds pre-determined
Advance rate subject to Net Orderly Liquidation Value
Regular independent evaluations
ICT maturity required (to transfer data)
Inventory segregation (if required)
Inventory tracking (if required)
8 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
The intention is that the CH Trading Hub, through its
ownership of the independent stock companies, will act as
an asset (inventory) management group and invest its equity
capital to build up a dedicated internal structured financing
team and provide, when needed, equity capital for specific
IM transactions. The CH Trading Hub also has ownership of a
dedicated securitisation company authorised in Luxembourg
which it intends to leverage to help facilitate the access of
inventory funders to the IM transaction, through both the
traditional and token financing routes.
As a result of the above, the CH Trading Hub is working
closely with the Group to maximise the opportunity for the
IM Platform and to constitute an Inventory Monetisation
infrastructure which can be used by both banks for their
White-Label offering, and investment banks, security
token arrangers and other inventory funders to adopt and
implement ad-hoc Inventory Monetisation programmes. In
the case of White-Label offerings it allows banks to leverage
their already wide client base, and in the case of other
potential inventory funders it allows them to work closely
with Supply@ME to access its pipeline of client companies
who have already expressed interest in unlocking their
working capital through Inventory Monetisation.
Our Delivery Model
During 2023 we have continued to enhance our business
operating model with continued development of our FinTech
IM Platform, including not only the underlying software but
also the supporting processes, methodologies, and legal
framework.
The inventory funding framework evolved further in 2023
through the launch of an independent CH Trading Hub.
The CH Trading Hub, owned by SFE has purchased certain
independent stock companies, to meet the needs of specific
IM transactions, and is in the process of assuming control of
the existing independent stock companies from the GIF. The
CH Trading Hub will also incorporate new independent stock
companies as required in the future.
The advantages to the Supply@ME Group of this new
collaboration with the CH Trading Hub are detailed below:
> Firstly, the CH Trading hub is located in Switzerland which
is traditionally an important trading hub (in particular for
raw materials and commodities) and a region establishing
itself as a global leader in the custody of digital assets
partly through its creation of a digital asset ecosystem
that allows for innovation and diversity within a clear
regulatory framework1. These characteristics are more
desirable to potential inventory funders compared to the
previous location of the GIF, being the Cayman Islands.
The CH Trading Hub has already seen increased interest
from potential inventory funders as a result of this new
structure.
> Secondly, this change responds to an evolution in the
regulation of the fund management industry. In particular,
the Monetary Authority of Singapore, Singapore’s financial
regulator, had advised that TradeFlow should separate its
licensed fund management activities from the rest of the
TradeFlow business. Potential inventory funders had also
provided feedback that the segregation of the Platform
provider and the investment adviser would help to
eliminate any perceived conflicts of interest between these
two roles. The completion of the TradeFlow Restructuring
on 30 June 2023 resulted in the clear differentiation of the
responsibility of both Supply@ME and TradeFlow, and lead
to the opportunity to collaborate with a group of private
investors and subject matter experts in working capital
solutions to launch the CH Trading Hub.
1
Swiss Digital Asset Custody Report 2023, The Capital Markets and Technology Association
9 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Our Delivery Model
The diagram below illustrates the role of the Supply@ME Group in the overall Inventory Monetisation infrastructure outlined
on the previous pages .
SFE Société Financière
Européenne SA
7
Inventory Hub
Parent Company
Inventory Funders
Provide Debt
4
Stock Companies
2
6
Platform Provider
and Servicer
Inventory
monetisation
3
5
Client Company
0
1
Originator of
contracts with Stock
Company and
provider of due
diligence services
Green circle = funds flowing to
Supply@Me Group
Inventory Monetised
0
1
2
3
4
5
6
7
Due Diligence
fees charged to
client company
by Supply@ME
Group
Origination fees
charged to client
company by
Supply@ME
Group
License fee
charged annually
by Supply@ME
Group to Stock
Company
Sub-license fee
charged annually
by Stock
Company to
Client Company
Interest paid
annually by Stock
Company to the
Inventory Funder
Fixed profit
charged by Stock
Company to
Client Company
as they buy back
the inventory
Service fee
charged annually
by Supply@ME
Group to Stock
Company
Return provided
in connection
with equity
contribution or
shareholder loan
from Stock
Company to SFE
As shown above, in a typical Open Market IM transaction
(being an IM transaction from the pipeline originated by the
Group and funded by third-party investors), Supply@ME
acts as the due diligence provider and originator in respect
of the client company, and as the IM Platform provider
and inventory servicer in respect of the independent stock
company. For each Open Market IM transaction, the Group
generates revenues from the following activities:
> Pre-Inventory Monetisation activities carried out directly
with the client company wishing to have their inventory
monetised, including due diligence in respect of the client
company itself and its potential eligible inventory, and
origination of the full IM contracts with the relevant stock
company
> Post-Inventory Monetisation activities carried out directly
with the relevant stock company including the usage of
the Supply@ME platform under a Software as a Service
(“SaaS”) contract and the support and administration
activities such as the monitoring, controlling, and
reporting on the inventory monetised.
This model can be flexed and adapted based on the
requirements of the inventory funders particularly in the
case of White-Label partners. For example the level of due
diligence required on a particular client company may vary if
it is already a client of a White-Label inventory funder, or they
may not require the use of a stock company in
a particular structure, in which case some of the Post-
Inventory Monetisation fees (such as the SaaS license fee)
may be charged directly to the White-Label inventory funder
rather than to the relevant stock company.
During 2023, the Supply@ME platform has further
developed its White-Label offering. Coupled with security
protocols and other Platform modules the Group has a clear
understanding of the costs and timelines to deliver modules
for a White-Label partner which will sit within a ring-fenced
set of Microsoft Azure resources. This is in part due to the
Group establishing its own dedicated Microsoft Azure cloud
environment which allows for multi-tenancy, meaning that
true White-Label capabilities exist in deploying a ‘just tech’
solution to any partners should they wish to proceed directly
and not through a independent stock company.
White-Label partners, with training and support from the
Supply@ME team, can acquire the necessary Platform
modules and manage their own Inventory Monetisation
solutions using their own personnel and entity structures as
agreed with each White-Label partner. In this scenario, the
Supply@ME team will be able to provide on-going training
and Platform module support to provide an optimal solution
for any White-Label partner with the adaptability to meet
their individual requirements.
10 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
The result of this detailed analysis is a list of qualifying
SKUs that are considered as eligible items for a potential
Inventory Monetisation transaction. Alongside this, an in
depth analysis is then completed on the client’s business
(e.g. credit analysis) and processes including, for example,
how they track and store inventory, manage orders, and
deliver orders etc. Additionally analysis is carried out in terms
of potential remarketers that can be used to mitigate the
risk for the inventory funders of the disposal of any unsold
goods, where required. Each deal is then run through the
stock company’s cash flow model to ensure sustainability
parameters are not breached.
Once the above due diligence analysis is complete this
is shared with the client and with any potential inventory
funders. Once a specific inventory funder accepts a specific
client company, the process moves from the due diligence
to the contracting phase, and it is here that the formal
commercial contract between the client company and the
relevant stock company governing the IM transaction are
negotiated and finalised.
Lastly, once the contracts are signed by stock company and
the client company, training is given on the Trading Module
to ensure a best in class user experience for the client in
uploading their first, and subsequent files. The client is then
ready to carry out their first IM.
Pre-Inventory Monetisation activities:
Due Diligence and Origination
The Group works both directly, and with an ecosystem of
partners, to identify client companies who are interested
in Inventory Monetisation, detail of 2023 client company
pipeline can be seen on pages 5 and 19.
After initial discussions with the client the appropriate
inventory model is applied, and the Supply@ME team then,
with secure data sharing and collaboration of the client, carry
out an early-stage in-depth analysis of sales history, historical
inventory data, and future projected sales which then
allows an initial value of eligible monetisable inventory to be
determined. During this stage, the Group’s inventory analysis
expertise is used to assess this data on a granular level
which includes breaking the initial eligible inventory down to
an individual Stock Keeping Units (“SKUs”) level.
With our Customer Relationship Management (“CRM”)
Module, we track each client’s progress through the
origination phase, assigning tasks to individuals as necessary
and tracking completion of those tasks. This module
also gives greater oversight on pipeline activities and
prioritisation, and understanding of inventory attrition rates
as the client progresses through the due diligence process.
With our secure data sharing tool, we ensure bank level
security when a client is sharing data with us, and provide
user only access is truly necessary. With our e-signature tool,
we can adhere to all the necessary jurisdiction guidelines
around e-signatures, including ID verification using
government issued ID documents.
This detailed assessment further filters out and identifies
typical ineligible inventory items according to the Supply@
ME Inventory due diligence parameters (or “Risk Appetite”).
Further consideration is also given to inventory turns,
forecast and historical sales, margins, seasonality, rates of
obsolescence, and criticality of the SKU to the client. The
selected SKUs chosen meet the Group , the stock company,
and the inventory funder’s Risk Appetite.
11 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
The Platforms “data factory” module facilitates the level
of data ingestion required, automated application of key
business rules and the creation of a unique inventory
data-lake to design and develop advanced inventory data
analytic metrics such as seasonality, obsolescence risk,
critical components, margin and sales trends, and to some
extent, client behaviours. Together this enables the Group
to effectively monitor and identify anomalies in the inventory
data being collected for monitoring and reporting purposes.
During 2023 the data ingestion module has continued to
be stress tested through live client data being available and
evolving our inventory models and the adaptation of our
Platform to match the requirements of these models.
The Group also provides administrative support in the
facilitation of the client company’s buybacks of the inventory
monetised, and refills of new eligible inventory items over
the course of the IM transaction contract.
As a result of the granular level of data ingestion and storage
available through the Platform, Supply@ME is able at any
time to provide an up-to-date picture of the inventory
monetised (and therefore owned) by the relevant stock
company, together with any receivable amounts owed to
the relevant stock companies. This seeks to provide our
traditional funding partners with the necessary reassurance
and transparency needed for such IM transactions.
As the Group’s business scales up, the focus will be on how
to augment the existing technology to allow the activities
referred to above to be completed in the most efficient
and effective way. This will be particularly important as the
volume of data being collected, monitored, and reported
on increases with each new IM transaction that is facilitated
over the Platform, and as the business seeks to refine and
improve its existing processes. Those improvements and
advancements to the Platform made over the past year are
detailed on the following pages.
Our Delivery Model
Post-Inventory Monetisation activities
Platform and Inventory Service Provider
The Supply@ME IM Platform is crucial to the overall IM
transaction as it is through this software technology that
the inventory being monetised is recorded, monitored
and reported on. In order to have usage of the Platform,
the relevant stock company will pay a licence fee to the
Group. In addition to the usage of the Platform, the stock
company also relies on the Group’s expertise in monitoring,
controlling, and reporting on the eligible inventory items
post monetisation as part of the inventory servicer activities
provided. To facilitate these activities, throughout the course
of a contract the client company must provide inventory data
extracted from their Enterprise Resource Planning (“ERP”)
system which allows the Group to carefully monitor the
inventory monetised (via inventory analytics) and to identify
anomalies to be queried with the client company.
In the case of the eligible order-based inventory models the
Supply@ME team has developed a methodology to analyse
the inventory SKUs required to satisfy orders received by
the client company and which are used for internal client
projects required to deliver these orders. The Group’s
monitoring team set Key Performance Indicators (“KPIs”) and
Key Risk Indicators (“KRIs”) based on the in-depth knowledge
of the client’s business model and selected eligible SKUs
gained during the due diligence process. This allows them
to quickly, robustly, and efficiently monitor and assess the
performance of each SKU as up to date data is received
from the client company. The data used to complete the
monitoring activities includes detailed information on the
client company’s sales, inventory movements, end customer
orders, and supplier purchase orders. This continuous
monitoring process enables the Group to understand and
report to the stock company (who own the goods as a
result of the Inventory Monetisation) if the client company is
adhering to the operating cycles and behaviours observed
during the due diligence phase. Data driven discussions are
held with the client around any anomalies detected and
if necessary, remediation strategies are agreed. Following
this, the monitoring and reporting cycle begins again. In our
live clients we have seen evidence of minor anomalies due
to unexpected client behaviours. Once we held the data
driven discussions with the clients, they refined some of their
processes to behave as per the expectations of our legal
frameworks. It is reassuring that our monitoring procedures
can identify these kinds of anomalies, and even more so that
the clients amend their behaviours appropriately. This leads
to a lasting value add relationship between Supply@ME, the
stock company, and the clients.
12 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
How we adapt to scale the business
“One size does not fit all” where Inventory Monetisation is
concerned.
Supply@ME’s business model has been developed further
during 2023, and to date in 2024, and adapted for a range
of client company inventory models and inventory funder’s
appetite for different inventory types. Understanding the
needs of a range of businesses and building this into the
Group’s processes and methodologies will enable faster
scaling as the Supply@ME business model will meet the
needs of a broader base of client companies and inventory
funder requirements. Each client company and hence
every inventory model presented to the Group has unique
features that need to be carefully considered and evaluated
to ensure the correct eligible inventory items are selected for
monetisation. This requires the Supply@ME team to:
> Understand the business industry within which the client
company operates, alongside the individual business model
> Work together with the client company to ensure the data
required to accurately assess and monitor the eligible
inventory items can be supplied in the required format
and within the required timeframes
> Identify the appropriate inventory model and monitoring
approach to use, or determine if a new approach will be
required
> Use its inventory analysis expertise to select which SKU’s
qualify as eligible inventory to be monetised. This will
largely be focused on reducing the risk to the relevant
stock company of being left with unsold inventory
> Prepare the client company due diligence report which
includes explanations regarding any ineligible inventory
items identified through the process
> Liaise with the relevant stock company to identify
potential inventory funders
> Liaise with the client company and relevant stock
company to originate the formal contractual arrangement
between the two parties
> Provide training to the relevant parties on the use of
the Platform to allow for the monetisation of the eligible
inventory items (which is facilitated using the Platform) and
> Continuously monitor the eligible inventory to allow
for reporting to the relevant stock company over the
performance of the inventory selected and to ensure
remediation strategies can be applied by the stock
company if necessary.
Currently, the business model of a client company will be
initially categorised into one of the inventory models set
out below. The Supply@ME team has developed specialist
inventory analysis expertise for each of these models based
on the characteristics of the industry and inventory.
Generic Goods
Client companies who trade finished goods, so purchase
and resell specific goods, are a tried and tested client model
for the Group and hence can move through the onboarding
and due diligence process swiftly.
Orders Based Model
Client companies who create or manufacture products “to
order” can be serviced by Group’s orders based model. The
Supply@ME team has developed a methodology to analyse
the inventory SKUs required to satisfy orders received by
the client company and which are used for internal client
projects required to deliver these orders.
Maturing Goods
The Group has recently implemented a new methodology
for goods that mature over time and whose price
appreciates or gathers wealth as they mature. These
goods are typically in the agri-food sector such as cheese
or wine, and leverage available external price matrices to
benchmark the current value of the maturing products. This
methodology is core to the BBPM White-Label binding term
sheet commitment announced in the RNS of 3rd January
2024. The Group also plans to develop methodologies that
will allow it to assess the inventory value for goods that
appreciate during the maturation process but for which
external pricing matrices are not available. This will open up
the market to a broader base of companies whose goods
mature, for example cheese, wine and cured meats.
Manufacturing
Where a client company takes raw materials and transforms
them into finished goods, Supply@ME has developed a
methodology to identify eligible items that includes both
the raw materials (before transformation) and the finished
goods (after transformation). This model is being further
developed to account for more complex manufacturing
scenarios.
13 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
How we adapt to scale the business
The Group’s ability to scale
The key to scaling the Supply@ME business is largely linked
to automation of the core elements of our delivery model.
This will allow the Group to effectively service the different
client company business models in the most efficient way
possible, which will in turn enable us to grow our pipeline
of eligible client companies in order to meet the varying
appetite of inventory funders. During 2023 progress has
been made through the clear identification of the key
serviceable client business models (referred to above)
and the development of the associated internal processes
required to allow client companies to access the benefits of
the Supply@ME Platform.
The Group sees the key to its ability to further scale as
becoming:
> best in class in inventory analytics for each of these
different models
> building automation through our due diligence processes
making it fast and easy for client companies to receive
feedback on eligible inventory items and enabling them
to establish if Inventory Monetisation is viable for their
inventory and
> building automation and technological scalability in our
monitoring and reporting activities to proactively detect,
report and mitigate risks for the relevant stock company.
In short, continued focus on our key strategic priorities,
and the shorter term goals that will allow us to deliver
these strategic priorities, is key. Further details of these key
strategic priorities can be found on pages 21–28.
14 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
How we follow the tokenisation trend
In 2023, the trend towards tokenising real-world assets has
surged, positioning itself as a significant transformative force
by integrating digital representations of physical assets onto
blockchain technology.
This movement is primarily propelled by the escalating
costs of capital, which spotlight capital inefficiencies, thereby
urging financial institutions to seek out tokenisation as
a strategic solution. This approach aims to streamline
existing processes, enhance operational efficiency, and
notably reduce costs associated with clearing, trading, and
financing activities. The applications of tokenisation span
across various domains, each distinguished by their unique
advantages. For efficiency, applications such as sustainability
reporting, financial market unification, and digital identity
management stand out.
Meanwhile, liquidity-focused applications endeavour to
forge liquid markets for assets previously deemed illiquid,
including carbon certificates and collectables, thereby
expanding their market reach and accessibility. The financial
sector has notably embraced this trend, with tangible
momentum observed in the tokenisation of financial assets.
However, the scope is anticipated to broaden, extending to
other asset classes such as supply chain inventories.
The overarching benefits of tokenisation, irrespective of the
industry, include enhanced liquidity through the facilitation
of fractional ownership, improved accessibility to markets
and assets previously out of reach due to high costs or
access barriers, and heightened transaction transparency
and security provided by blockchain technology. Moreover,
operational efficiencies are anticipated to significantly
benefit from reduced costs, streamlined reconciliations,
and simplified monitoring processes. Additionally, the
composability feature of DeFi platforms allows for RWA
tokens to be utilised in novel ways, further enhancing
potential returns and use cases for investors.
As of now, the realm of real-world asset tokenisation
encompasses distinct categories:
Real estate, where assets are tokenised to
yield passive income through rentals or
utilised as collateralisable assets on
Decentralised Finance platforms.
Luxury and Collectibles, where tokenisation
is applied to unique or rare items, typically
under the Non-Fungible Token (NFT) model.
Commodity, focusing on the tokenisation of
gold and to a lesser extent silver, with other
commodities like oil, gas, or agricultural
products still largely untapped.
Equity and Debt, involving the tokenisation
of government and corporate stocks and
bonds, complemented by secondary
markets for trading.
Carbon and ESG, where tokenisation is applied
to ESG investments, particularly carbon
neutrality initiatives, in response to stringent
regulations, creating a vibrant market for
buying and “offsetting” carbon credits.
15 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
How we follow the tokenisation trend
Future developments in tokenisation are poised to impact a
wide array of sectors:
Financial Services are expected to see
innovations like tokenised deposits and the
proliferation of stablecoin-based payment
systems.
The Industrial Sector, including
manufacturing, construction, and waste
management, is likely to benefit from
enhanced efficiency and transparency.
Energy and Utilities, especially in renewable
energy and the carbon credit market, stand
to gain from streamlined monitoring and
trading.
The Public Sector could see the introduction
of secure digital identities for citizens and
simplified access to public services.
Real Estate is identified as a sector with
significant growth potential due to the ease
of trading and fractional ownership enabled
by blockchain
A report by 21Shares at the end of 2023 spotlighted the
impressive $118.57 billion worth of tokenised assets on
public blockchains, with Ethereum hosting 58% of these
assets, showcasing an average daily user count of 6 million.
The focus on tokenised private loans and U.S. Treasuries
within the securities-type RWA sector has been particularly
pronounced since 2020, focusing initially on unsecured
loans in the private credit sector. Data from rwa.xyz as of
November 27, 2023, illustrates the significant growth in
the value of active loans across various protocols within
the private credit sector RWA, totalling about $5 billion in
December 2023. Concurrently, the demand for tokens
linked to U.S. Treasuries has surged, with the Total Value
Locked (TVL) in RWA projects linked to U.S. Treasuries
rising from $100 million at the start of 2023 to $780 million,
indicating robust demand1.
Despite the burgeoning interest and the expansive scope
of tokenisation, the path is strewn with regulatory and
operational challenges. A report by Roland Berger titled
“Tokenization of Real-World Assets: Unlocking a New Era
of Ownership, Trading, and Investment” delineates the
segments poised for significant developments, including
financial services, the industrial sector, energy and utilities, the
public sector, and real estate, highlighting the vast potential
of tokenisation. However, regulatory landscapes continue to
evolve, with legal compliance, KYC/AML regulations, valuation,
audit implications, security, and scalability among the chief
concerns that must be addressed to unlock tokenisation’s full
market potential. Collaboration among stakeholders, including
regulators, issuers, service providers, and investors, is crucial
for establishing a standardised, compliant environment for
global tokenisation efforts.
In this context, the future of tokenisation remains promising,
with projections suggesting the market value for tokenised
assets could reach between $3.5 trillion and $10 trillion by
20302. This optimistic outlook underscores tokenisation’s pivotal
role in heralding a new era of digital finance and investment,
reshaping the global economic landscape in the process.
Supply@ME is uniquely positioned to unlock a market for
tokenisation of inventory as a real world asset to both retail
and institutional investors. The relationship with VE Chain
and the solid progress made in structuring a security token
framework with the CH Trading Hub to allow the first
security token issuance up to USD$100 million is the
first step on this journey.
1
Link to website: https://app.rwa.xyz/treasuries
2
The State of Tokenization by 21 Shares, 2023
16 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Serviceable Obtainable Market
Background
When considering the potential market for a new product,
the quantum of the problem that the product has the
potential to solve gives an indication as to the size of the
market opportunity. The Supply@ME product of Inventory
Monetisation facilitates unlocking of capital in a company’s
supply chain whilst also enabling a new market of assets for
investors in the form of inventory. This leads to the question,
how big is this market opportunity for Supply@ME’s platform?
The need for supply chain financing solutions is clearly
demonstrable. The most established parts of the market
(factoring, receivables discounting, and payables finance)
estimated at €1,633.5 billion or 10% of EU’s GDP in 20181,
at which point it was estimated that €49,354,416 million
was being loaned or advanced against inventory across EU
member states (including UK at that time). This is prior to the
move from the “just in time” to the “just in case” inventory
model which was facilitated by the global pandemic in 2020.
The novel solution that Supply@ME offers has the potential to
unlock flows in the supply chain financing market even further.
A recent bank lending survey published by the European
Central Bank2 reports net demand by firms for loans
continued to decline substantially in the first quarter of 2024
(net percentage of -28%), in contrast to expectations of
stabilisation reported in the previous round of the study in
January 2024 (net percentage of 2%).
While the net percentage of banks reporting a decrease
remained smaller than its all-time low in the second quarter
of 2023 (-42%), the decline added to the substantial net
decreases in loan demand since the fourth quarter of 2022.
Banks in all four large European area countries reported
a further net decrease in demand. The strong decline
contrasted with banks’ expectations of a slight increase.
The general level of interest rates and declining fixed
investment remained the main drivers of the net decrease in
loan demand (see Exhibit 1).
Exhibit 1 – Net percentages of banks reporting changes in demand
for loans or credit lines to enterprises, and contributing factors
60
40
20
0
-20
-40
-60
-80
-100
40
0
-40
-80
-120
-160
Q2 2024
Q1 2024
Q4 2024
Q3 2023
Q2 2023
Q1 2023
Q4 2022
Q3 2022
Q2 2022
Q1 2022
Q1 2024
Q4 2024
Q3 2023
Q2 2023
Germany
Q1 2024
Q4 2024
Q3 2023
Q2 2023
Spain
Q1 2024
Q4 2024
Q3 2023
Q2 2023
France
Q1 2024
Q4 2024
Q3 2023
Q2 2023
Italy
Demand - actual
Demand - expected
Fixed investment
Other Financing needs
Inventories and working capital
Use of alternative Finance
General level of interest rates
Other Factors
The euro area bank lending survey - First quarter of 2024 (European Central Bank).
1
2
European Commission Study on Supply Chain Finance, Valdani, Vicari & Associati January 2020
The euro area bank lending survey - First quarter of 2024 (European Central Bank).
17 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Serviceable Obtainable Market
The reported decline in loan demand was mainly driven
by the general level of interest rates, as reported by banks
in all four large European area countries, and lower fixed
investment, consistent with the net decrease in demand
for long-term loans. It was also reported that several banks
in Germany referred to uncertainty about the domestic
economic outlook and geopolitics more generally. At the
same time, financing needs for inventories and working
capital had a neutral impact on loan demand. Alternative
sources of Financing, such as internal financing and market-
based financing via debt securities and corporate equity,
dampened loan demand in the European area only slightly
in the first quarter of 2024. Similarly to total net demand for
loans to firms, the general level of interest rates and firms’
financing needs for fixed investment were the main drivers
of the decline in demand for loans to both SMEs and large
firms (see Exhibit 2).
Exhibit 2 – Net percentages of banks reporting a change in demand for loans or
credit lines to SMEs and large enterprises, and contributing factors
60
40
20
0
-20
-40
-60
-80
-100
60
40
20
0
-20
-40
-60
-80
-100
Q1 2022
Q2 2022
Q3 2022
Q4 2022
Q1 2023
Q2 2023
Q3 2023
Q4 2024
Q1 2024
Q2 2024
Q1 2022
Q2 2022
Q3 2022
Q4 2022
Q1 2023
Q2 2023
Q3 2023
Q4 2024
Q1 2024
Q2 2024
Loan to SMEs
Loan to large enterprises
Demand - actual
Demand - expected
Fixed investment
Other Financing needs
Inventories and working capital
Use of alternative Finance
General level of interest rates
Other Factors
The euro area bank lending survey - First quarter of 2024 (European Central Bank).
The outcome of the recent lending survey conducted by the
European Central Bank clearly indicates that corporates are
trying to optimise their cost of funding, considering the high
level of interest rates which impacts their net profits.
This trend also reflects the current Supply@ME pipeline,
where some client companies decided to review the use
of the Inventory Monetisation facility or to wait for better
market conditions before proceeding. Also, some potential
client companies were excluded from the pipeline due to
the deterioration of their financial and/or business outlook.
For this reason, in order to support the inventory funding
processes managed by the CH Trading Hub, to date during
2024 a new process has been introduced where client
companies are asked to sign a Letter of Intent (“LoI”), which
going forward will be the catalyst to inclusion in our pipeline
numbers, this new operational KPI is referenced below. For
the purpose of this Annual Report and Accounts, we include
reference to the pipeline KPI used in previous years which
represents the current potential value of warehoused goods
inventory to be monetised rather than the pipeline revenue
to be earned by the Group as well as this new measure
which is underpinned by those client companies who have
signed an LoI or term sheet (“New LoI pipeline number”).
The LoI process has been very recently introduced and the
associated numbers are currently low, we anticipate being
able to provide a stronger indication of the pipeline in our
next market update.
18 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Italy
United Kingdom
Origination in the UK has slowed in line with the background
shown above and the availability of dedicated inventory
funding programmes by the CH Trading Hub. As Supply@
ME continues to onboard the existing pipeline and build its
track-record, this will unlock further related client company
opportunities in the UK. Client companies from the UK
included in the overall Group’s pipeline KPI have inventory
equivalent to £1.8 million as at 19 April 2024, (£212.1 million as
at 21 April 2023). The New LoI pipeline number is £1.8 million.
Europe (excluding UK and Italy)
Client companies have typically been sourced through
Supply@ME’s strong relationships held with a global eco-
system of introducers which have also enabled the growth
in a wider European portfolio of client companies; including
opportunities in France and Germany. There are several
larger ticket opportunities to monetise inventory subject
to the appropriate structure and funding being in place.
Supply@ME has opportunistically engaged with a company
with inventory in warehouses in other European countries
currently £10.3 million of the pipeline for both the historical
method of reporting and the New LoI pipeline number is
located in other European location. Further details will be
announced in due course.
As the track record of transactions and awareness of our
Inventory Monetisation Platform, and its ability to facilitate
Open Market IM’s, continues to grow, following the inaugural
Italian transaction in September 2022 with VE Chain and
further traditional funding IM transaction in 2023 there
is interest from small and large businesses, with differing
levels of monetisable inventory. The success of our first
IM reignited discussions with businesses which had first
been introduced to Supply@ME before the pandemic. Our
pipeline of Italian opportunities continues to evolve and we
are developing the options to facilitate further IMs with other
inventory funders via the CH Trading Hub.
The new Italian legislation pegno non possessorio (the “PNP
Regulation”) was published in January 2023 and came into
effect in June 2023 introducing the concept of security interest
(a concept widely adopted across Europe and the UK) into
Italian law, allowing entrepreneurs to access financing of
their inventory more easily, without having to sell, transform
or otherwise dispose of their business assets. The first
traditional IM transaction in Italy leveraged this regulation.
Supply@ME anticipates it will create further opportunity for
traditional inventory funders to invest in IM transactions
considering the proposed improvements to the legal
enforceability of guarantees over the inventory, through the
arrangement of White-Label agreements, as happened with
BBPM as per the Company’ announcement made on 3 January
2024. Additionally, the recent announcement with regards to
Supply@ME’s agreement with the Italian neo bank will enable
the Company to make solid progress in the Italian market.
Client companies from Italy included in the overall pipeline
KPI have inventory equivalent to £318.6 million as at 19 April
2024, (£162.5 million at 21 April 2023). It is worthy of note
that over 59% of this number is comprised of the inventory
of one large corporate Italian client. The New LoI pipeline
number is £19.2 million.
19 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Case study - Retreading
Supporting a business vital to reducing the environmental impact of the automotive sector
The impact
Monetising their inventory has enabled this Italian success
story to increase its international expansion efforts. This
business, which has always been at the forefront of
innovation in the retreading sector, can now devote more
capital to R&D, enabling it to further improve its production
processes and compete and win more tenders, globally. Its
financial position has been improved, enabling it to plan,
for the long term, with greater certainty and it can invest in
expertise and equipment to capitalise on increasing
demand for its products.
The problem
Tyre treading is a sector that is rarely, if ever, in the
spotlight. Yet, it is vital in the automotive sector and,
particularly, to its efforts to reduce its environmental
impact. A new truck or bus tyre requires around 80 litres of
oil, retreading it needs less than 30 litres. In addition, the
retreading process preserves about 80% of the old tyre
and saves up to 70% of energy. More than 70% of
commercial transport fleets, globally, retread their tires at
least once. A retread, typically costs less than half the price
of a new tyre, giving it both commercial and environmental
advantages. While the sector does not receive the plaudits
it should, it has been innovating and driving a circular
economy for over a century. It is also inventory intensive.
The retreading industry is heavily linked to large
commercial tyres for trucks, buses, construction vehicles
and aviation. All of these require a lot of storage space.
R&D costs are also high, the industry is constantly pushing
to reduce waste, improve efficiencies, with each business
seeking to further its environmental credentials and
reduce costs to win tenders.
The solution
Supply@ME was approached by one of the grandee
companies of the retreading industry. This business with
operations across the globe saw significant potential for
growth. Commercial fleets have become increasingly
environmentally conscious and tenders now place a
premium on sustainability. This decades old business had
the know-how and track record, yet operating costs were
preventing it from scaling to its true potential. Supply@ME
integrated its monitoring software within the business’
existing systems without creating friction or delaying
processes. This monitoring software also enhanced the
existing infrastructure enabling them to enhance their
supply chain and inventory planning.
20 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
20 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Key strategic priorities
Our three long term Key Strategic Priorities as outlined in the
prospectus in March 2020 are:
1. Become the best Fintech at Inventory Data Monitoring
2. Develop a phygital multi-channel funding strategy
3. Spread a highly scalable global business
Progress against these strategic priorities over the last year
are detailed in the next pages.
21 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Key strategic priorities
1. Becoming the best FinTech Inventory
Data Monitoring Business
Update on sub-goals from 2020 Prospectus
Priority
2023 Progress
Integrate platform
with bank accounts
Ongoing
Due to the stage of growth of the Group and the to date small number of clients onboarded
this has not yet been a direct priority for Supply@ME, as we grow this is a longer term goal
which will be developed in due course as the desire for it becomes higher from corporate
clients and inventory funders.
Progress has however been made on how the data from clients ERP feeds could be ingested
into the Supply@ME platform as detailed below. The Group also anticipates that the
integration / automation with bank accounts (aimed at creating automated rebates once a
client company sells the inventory owned by the relevant stock company) could be an area to
further explore within the White-Label business line, leveraging the relationships with the
White-Label funder which is expected to typically be a commercial bank.
Due diligence /
onboarding
digitisation
Ongoing
During 2023, the Client Relationship Management (CRM) & Due Diligence Module of the IM
Platform was finalised and went live for use internally by the Group. This has enhanced
procedural consistency, accountability, and reporting. This module allows multiple users with
pre-defined roles (and access rights) to enter information and complete tasks related to the
CRM, Due Diligence, and contracting phases of the Group’s activities.
It also facilitates greater oversight on pipeline activities and prioritisation, and understanding of
inventory attrition rates as the client progresses through the due diligence process.
The CRM and Due Diligence module is available to be used for the Group’s White-Label solution.
During 2023, through using the “Test and Learn” approach, the Group has further refined the
due diligence process to optimise resources and client satisfaction.
Enterprise Resource
Planning (ERP) fully
integrated
Ongoing
The data-ingestion cloud-based scalable component that was purchased and customised
during 2022 allows the Platform to integrate multiple-data sources (for example ERP,
Warehouse Management Systems, etc.), underpinning the management of an inventory
analytics data hub.
22 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Priority
2023 Progress
Internet of Things
(“IoT”) (smart
cameras, Radio
Frequency
Identification RFID)
integration for
inventory off-site
monitoring
Ongoing
A pilot of IoT tracking is being explored for the Banco BPM White-Label transaction, together
with a US technology partner.
The objective being to create, a unique, unchangeable identifier with the physical object,
thereby creating a digital twin, with reference to the inventory items monetised.
The microtransponder technology (a silicon microchip) can trace, connect, and authenticate
goods across the supply chain.
Supply@ME aims at integrating its platform with the solution offered by the US technology
partner, helping the verification process of the authenticity of the inventory items monetised,
tracking chain-of-custody across the supply chain and managing data through web, cloud, or
blockchain applications.
Remarketing digital
workplace
(e-marketplace
where remarketer
can monitor, and
place signed
Inventory purchase
offers)
Ongoing
The remarketing activities represent a key requirement for certain IM transactions since they
mitigate the risk for the stock company and inventory funders to manage, directly or indirectly,
the disposal of any unsold goods and, from another perspective, improve the selling
capabilities of the overall model so that is it not solely reliant on the performance of the client.
In this regard, the Group continues to work with inventory disposal specialists to develop a
standard framework, underpinning the remarketing phase. The network of remarketers is
increasing and over time the remarketing offering will mature.
Other progress towards becoming the best FinTech Inventory Data Monitoring Business
Priority
2023 Progress
Expansion of
inventory models
Ongoing
As stated in how we adapt to scale the business section of this 2023 Annual Report and
Accounts, as found on pages 13–14, we now have policies, procedures and frameworks in
place that address several different inventory models. These have been developed by the
team as a result of the Group working closely with a variety of clients over the past year and
gaining an understanding of both the vertical industries and the individual business processes
of these client companies. As these Groups continue to work more closely with a diverse
range of client companies, it will allow the processes and procedures to be continually refined,
and new inventory models to be addressed.
Data standardisation
and ingestion
Ongoing
Through adapting the business model for the different client company inventory models as referred
to above and having greater exposure to a wider range of clients, we have now been able to
standardise our data models. This is a critical first step in employing and augmenting the right
technology modules and methodologies to the Platform. Our data ingestion module, through
ad-hoc customisations, has the capability to process all the data necessary for each model.
Monitoring
methodologies
Ongoing
The adaption of the policy and procedures for the various inventory models has allowed us to
simultaneously develop the appropriate monitoring procedures that work best with each model.
Monitoring is one of the Group’s Unique Selling Points (“USPs”) and is key to ensuring we provide
both the independent stock companies and the inventory funders the necessary transparency
and protection against any potential client fraud or losses arising from unsold inventory.
23 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Key strategic priorities
Priority
2023 Progress
Inventory Data Lake
and Reporting
Ongoing
Through ingesting the data using the most appropriate level of granularity, and by classifying
the data appropriately, we can now overlay standard reporting tools to be able to provide
transparent reports to our client companies as well as to the independent stock companies
and inventory funders.
Trading Module
Ongoing
Each Inventory Monetisation transaction is underpinned by strong procedures and some
tasks of the trading process are digitalised, allowing the users to buy and sell, via digital
interfaces, the inventory items.
Also learning from the first up and running IM transactions, the product team of SYME will
collect further business requirements which may lead to further digitalisation of some specific
activities and/or the improvement of the over-all user experience of the trading process.
24 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
2. Developing a multi-channel funding strategy
Priority
2023 Progress
Client Company
Strategy
The Group has focused primarily on the European and UK market during 2023 with the aim of
continuing to build our track record of the first traditional funding and tokenisation IM
transaction, and kicking off our White-Label go-to-market offering. Further expansion of the
Group’s global reach will be a focus as the value and benefits of Inventory Monetisation is
increasingly recognised.
Europe (including Italy)
The Group’s marketing and sales team works with a select panel of originators and local
business introducers who continue to make introductions to high quality businesses. As the
track record and awareness of Inventory Monetisation builds, following the first two completed
IM deals in 2022 and 2023, the Group is seeing opportunities to develop its product to cover a
range of business models and inventory types as detailed in the how we adapt to scale the
business section of this 2023 Annual Report and Accounts on pages 13–14.
The Group has built a strong pipeline in Italy to facilitate further IMs through both the security
token route and traditional inventory funding. The pegno non possessorio (“the PNP
Regulation”) was published in January 2023 and came into effect in June 2023 introducing the
concept of security interest (a concept widely adopted across Europe and the UK) into Italian
law, and allows entrepreneurs to access financing of their inventory more easily, without
having to sell, transform or otherwise dispose of their business assets. The first traditional IM
transaction in Italy leveraged this regulation. The Group has observed in the latter part of 2023
some Italian banks have started to adopt the PNP Regulation within their asset financing
transactions demonstrating the kick off of the over-all adoption programme by the Italian
banking sector.
We have also been working closely with a particular client from our pipeline who has inventory
located in France and as a result this has led to us investing and developing standard French
contracts.
United Kingdom
Origination in the UK has taken longer than expected to materialise. Given that Supply@ME
now has a legal framework in place we expect this to accelerate. The signing of agreements for
the first UK IM transaction was announced on 3 July 2023, the execution of this transaction
was delayed due to several external “barriers” (outside of SYME control) such as an existing
floating charge facility which has required the client company to gain specific waivers, amongst
other things. While this has resulted in delays to this deal, it has proved invaluable in enabling
the team and framework to work to overcome these barriers.
Client companies have typically been sourced through SYME’s strong relationships held with a
global eco-system of introducers which have also started to develop a wider European
portfolio of client companies. As the Group continues to onboard the existing pipeline and
build its track-record, this will unlock further related client company opportunities.
Additionally Supply@ME’s relationship with SFE will help the Group to capitalise on the
foundations built by the sales and marketing team through SFE sourcing funders interested in
monetising the inventory of the client companies identified.
25 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Key strategic priorities
Priority
Funders
2023 Progress
SYME has continued to work diligently to build quality portfolios of client companies to attract
quality inventory funders. Leveraging the first IM transaction made in 2022, the first traditional
Inventory Monetisation transaction made during 2023 and the White-Label commitment
obtained in early 2024 the Group, as the provider of the Platform and inventory servicer, is
now working on the following funding routes:
White-Label
During 2023 work progressed with launching the White-Label go-to-market strategy, this work
culminated in the announcement on the 3 January 2024 of the commitment provided by
BBPM to fund an initial IM transaction with an inventory value to be monetised up to €10
million of an existing client of theirs. During early 2024 there have been a number of
approaches by local and global banks to explore developing their inventory funding offering
utilising the Group’s technology and unique methodologies.
As detailed in the Our Delivery model section on pages 9–12 there is flexibility in the White-
Label offering for partners to select from a suite of the Group’s services as required.
Digital Assets/Token Route
Building on the 2022 adoption of the VE Chain Thor blockchain protocol, during 2023 and
early 2024 work has been undertaken to expand the offering in the Web3 arena by adding
Security Tokens as a distribution tool. This allows potential inventory funders (through the CH
Trading Hub) to subscribe to a part or whole of a Security Token, which are backed by
Non-Fungible Tokens (NFTs), which are in turn backed by the inventory monetised and owned
by the relevant stock company. The development in this space will open IM’s as a new asset
class to a broader range of potential inventory funders.
As outlined in the how we follow the tokenisation trend section of this report on pages 15–16
there is significant opportunity for funding through tokenisation of inventory as an asset
through both crypto asset managers and direct investors through liquidity pool partnerships.
Collaboration with investment bank and asset managers via the Open Market IM
business line
The Group has seen interest from banks and alternative asset fund managers in funding the
pipeline of clients originated by the Group. These programmes could cover the Group’s
existing client pipeline and, also, new clients that match the eligibility criteria requested by the
potential inventory funders. The recent announcement of the agreement with the Italian neo
bank is significant progress in this area.
26 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
3. Creating a highly scalable global business
Priority
2023 Progress
Operations
Ongoing
Our internal processes have continued to develop during 2023 with a test and learn approach
in line with the adaption of the policies, procedures and framework for the differing inventory
models, and associated corporate client and inventory funder needs.
A greater level of automation and translating these processes into technology solutions will
enable the scalability of the business.
Developments have also been significant in building the protocols, structures, and processes
required to deliver the White-Label solution.
Legal framework
Ongoing
During 2023, and as a result of working with different vertical industries and in different
jurisdictions we have now legal framework agreements and trading templates for a number of
operating models in UK, Italy, and France.
Additionally, as a result of the launch of the White-Label go to market strategy, we have
broadened our legal framework pack to cater for this type of solution.
The learning from the delay in the UK transaction, largely the result of the IM being managed
alongside an existing floating charge facility which has required this client company to gain
specific waivers has been invaluable with regard to how to operate the Group’s product with
respect to clients existing facilities.
27 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
The Group’s 2024 focus is as follows:
> Demonstrate to the market how Supply@ME can provide
its inventory expertise through an “inventory funding
infrastructure as a service” approach, facilitating inventory
assessment, funding, monitoring and reporting.
> Working closely with SFE to structure integrated
processes in order to support SFE in the dialogue with
inventory funders and the necessary structured financing
activities.
> Also considering the previous points, continue to
augment our technology, processes and IM Platform to
cater to varying client business models and best serve our
clients and leverage funder interest in specific business
models and markets. Regarding inventory models rolled
out in 2023 and continuing to be further refined in 2024,
these are:
> Order driven businesses, where the business takes
client orders and builds bespoke products
> Inventory which undergoes an aging process, where
our platform facilities the monetisation of the inventory
as it ages
> Trading & finished goods, businesses who resell and
trade in goods
> Raw materials to finished goods, companies who make
goods to trade
> The potential market for the Supply@ME model is global.
However, the 2024 focus will be on building client pools
in UK and Europe, in line with the eligibility criteria of the
inventory funders and SFE. However, Supply@ME is
always open to opportunities and will continue to
evaluate potential market expansion routes.
> Now that there is a proof of concept for our White-Label
solution provided by the agreements with BBPM the
Company will build it’s White-Label track record, working
closely with commercial banks.
Key strategic priorities
For the first time in 2023 the Board shared shorter term
goals aimed at contributing to these longer term key
strategic priorities referred to in detail above. Progress
against these over the past 12 months is outlined below:
Build track record
The focus on building a solid track record of Inventory
Monetisations across Supply@ME’s initial core markets of
UK and Italy has led to the announcement of the execution
of contracts relating to the first traditional IM’s in both these
markets. These contracts also start to build the Group’s
recurring revenue based.
Expand pool of inventory funders
The team have continued to evolve its approach to the
service provided to inventory funders and the stock
companies. Additionally, the strategic partnership with SFE
developed during 2023 will be key to this approach. The
development of this structure is designed to grow the pool
of inventory funders interested in using the Supply@ME
Platform. The evolving approach to inventory funders has
also been demonstrated by the announcement of the
White-Label agreement with BBPM and also the institutional
investor involved in the traditional funding announced
during 2023. Additionally the development and interest in
the tokenisation route during 2023 and early 2024 and the
proof of concept demonstrated by the VE Chain transaction
in 2022 opens a pool of funders interested in digital assets.
Maintain solid pipeline of targeted corporate clients
The team at Supply@ME have continued to build the
corporate client base. This client base provides the inventory
for Open Market IM Transactions and provides revenue to
the Group through pre and post-monetisation activities. The
client base is delineated according to its business model
and inventory type as outlined in the “how we adapt to scale
the business” section on pages 13-14. The evolution of our
pipeline reporting also demonstrates the learning about
eligible inventory attrition rates as we progress through the
due diligence phase and what our target client minimum
size should be in each industry vertical. We can now quickly
identify if a client and their anticipated eligible inventory size
will be attractive to our pool of inventory funders.
Focus has been given to the inventory turns and volume
of inventory to be monetised by each client and how the
Supply@ME solution can best serve their needs. The volume
of inventory turns is salient when facilitating Inventory
Monetisation transactions for some client business models
as in some instances it affects the return received by the
inventory funder and also the level of risk to the stock
company of unsold goods.
28 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Our Team
The Supply@ME team are fervent believers in our Inventory
Monetisation product and its Unique Selling Points and are
passionate about bringing this product to market.
Our team have developed unique expertise in Inventory
Monetisation through the “Test and Learn” process. This has
been developed by working with:
> Clients to appreciate their business models and how
Inventory Monetisation can support them, and how to
adapt the Inventory Monetisation model to meet their
needs and those of inventory funders
> Partners to understand what they require in order to
support all stakeholders in the transaction safely and
effectively
> Data to assimilate, augment, interrogate, and analyse all
phases of activity with the client
Our team size had reduced since the release of the 2022 annual
report, partly as a result of the end of specific projects and
hence contractors leaving and partly due to prudence
around managing the cost base when considering
replacing roles as team members leave.
The tenure of our team demonstrates
the level of commitment to fulfilling
the ambitions of the Company and
the willingness of the team to
persevere through what has
been a challenging year.
29 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Our Team
As at 19 April 2024
Permament and fixed
term contractors
Day-rate contractors
Our team works remotely
across 3 European Countries
16
19 in 2022
1
3 in 2022
Chief Executive Officer
Finance
Operations and
Due Diligence
Technology and Product
1
1 in 2022
3
3 in 2022
6
7 in 2022
2
5 in 2022
People
Risk
Sales and Marketing and
Client Onboarding
Female
41%
1
1 in 2022
1
1 in 2022
Male
3
4 in 2022
59%
Less than 1 year tenure
1 to 2 years tenure
2+ years tenure
2
1
14
30 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Diversity
In line with the FCA’s listing rule requirements below is the required breakdown of the Board and Leadership team diversity as
at 19 April 2024 the last practicable date to report.
Gender
Men
Women
Not specified/prefer not to say
Total
Ethnicity
Number of
Board members
Percentage of
the Board
Number of
senior positions
on the Board
(CEO, CFO, SID & Chair)
Number in
executive
management
Percentage of
executive
management
4
1
0
5
80
20
0
100
2
0
0
2
2
2
0
4
50
50
0
100
Number of
Board members
Percentage of
the Board
Number of
senior positions
on the Board
(CEO, CFO, SID & Chair)
Number in
executive
management
Percentage of
executive
management
White British or other White
(including minority-white groups)
Mixed/Multiple Ethnic Groups
Asian/Asian British
Black/African/Caribbean/Black British
Other ethnic group, including Arab
Not specified/prefer not to say
Total
5
0
0
0
0
0
5
100
0
0
0
0
0
100
2
0
0
0
0
0
2
4
0
0
0
0
0
4
100
0
0
0
0
0
100
Supply@ME’s Board does not yet meet the target of 40%
of its directors being women, it also does not represent
the gender diversity of the organisation as a whole. The
leadership team immediately below the Board is 50% and
the workforce as a whole is 41% female. In terms of the
requirement for a senior position on the Board of directors
(Chair, CEO, Senior Independent Director or CFO) to be held
by a woman, the Supply@ME CFO is female, however is not
currently a member of the Board of Directors although she
does attend and contribute to the vast majority of Board
meetings. Supply@ME is a Fintech company whose main
sources of talent are from Financial Services, Technology
and the Fintech market, all of which have had challenges
attracting and retaining female talent, this does not however
limit Supply@ME’s ambition to have a diverse team and
will strive to do so. The Board does not currently meet the
recommendation to have one member of the Board from a
minority ethnic background. During the course of 2023
Alexandra Galligan has taken on the role of Board Diversity
Champion, and will work closely with the Chief People Officer
and Chief Executive Officer on Supply@ME’s approach to diversity.
31 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Our Leadership Team
Amy Benning
Chief Financial Officer
Stuart Nelson
Group Head of Enterprise Risk Management
Amy gained her Chartered Accountancy qualifications in
New Zealand while working with KPMG on a range of
clients across various industry sectors. On moving to the
United Kingdom, Amy worked briefly with BP’s shipping
arm, before moving to PwC’s London Capital Markets
Team where she spent 12 years focussing on technical
accounting, mergers and acquisitions and initial public
offerings for a wide range of clients. In 2018, Amy moved
to Alfa Financial Software Holdings PLC, a UK main market
listed company and developer and provider of software
for the automotive leasing sector. As Finance Director,
Amy was responsible for the team which managed
accounting, reporting (internal & external), corporate
governance, audit, systems, process improvement,
controls, and transactional accounting. Amy joined
Supply@ME in June 2021.
Stuart is an experienced credit risk analyst, with global
experience of assessing the risk of financing solutions
across multiple asset classes. Having begun his career at
JPMorgan in the EMEA Emerging Markets Team in 2000, he
then spent almost two decades in leadership roles at S&P
Global Ratings. During his time at S&P, he managed
multiple teams across the European office network in
London, Milan, Frankfurt, Madrid, and Paris, focussing on
the assessment of asset securitisation in all sectors, with
oversight of ratings on securities of more than €50 billion
equivalent over that period. From 2015, he concentrated
his attention on the refinement and validation of risk
methodologies across a global spectrum of asset classes.
Stuart joined Supply@ME in 2020, where he monitors all
aspects of the risk and operational functions.
32 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Alice Buxton
Chief People Officer
Mark Kavanagh
Group Head of Operations and Transformation
Alice is a HR leader motivated to help businesses succeed
by creating environments which enable individuals, teams,
and leaders to thrive. She has considerable experience in
the Financial Services and FinTech industries. Prior to
joining Supply@ME she built the Global Talent function at
Greensill, helping the business grow its workforce from
250 to over 1,200 in multiple jurisdictions in just over two
years. Previously she worked as an Executive Director in
Goldman Sachs Human Capital Management Division,
focusing on the EMEA Trading floor and Risk, Audit and
Compliance teams attracting and developing high
potential talent.
Before this she worked in Talent Acquisition for Ernst and
Young’s London office, recruiting for their risk and advisory
business. Alice has a BSc in Psychology, MSc in Human
Resource Management and is a qualified corporate and
executive coach. Alice joined Supply@ME in June 2021.
Mark is an experienced Risk Leader with over 25 years in
Credit & Risk functions. Before joining Supply@ME, Mark
worked for Greensill Capital as Head of Product Risk.
Whilst there, he implemented accounts receivable (“AR”)
policies and procedures, installed an AR platform, helped
Greensill expand territorially, and trained the Credit team
on any new product offerings, acquisitions, and
integrations. Prior to that, he worked for GE Working
Capital Solutions (the monetisation arm of General Electric
group) for 15 years, heading up their European Credit
Team, managing the auto scoring and decisioning system,
and ensuring processes were safe and efficient. Mark
joined Supply@ME in June 2021.
Recent Changes
During early 2024 Nicola Bonini, Group Head of Origination, left Supply@ME. Since her departure our CEO has become
more hands on in leading our Sales and Marketing function and the relationships the Company has with our external
ecosystem of originators. During 2024 continued assessment will be made as to the right moment to augment our sales
and marketing team further balancing this with the revenue, funding, and cash flow.
33 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Today, my role has evolved into Client and Sales Lead as
part of the Marketing and Sales team. In this capacity, I am
responsible for business development and researching
potential new clients. Once we identify and validate
prospective clients, I educate the clients about the Supply@
ME services, collect further information about the clients
business model and inventory held, and lead negotiations
of the term sheets to kick off the due diligence activities
required. The ultimate objective in this role is not only to find
clients who require our services but also to effectively convey
the advantages and functionality of our offering.
What will the future of Supply@ME look like from your
point of view?
I am confident our future is very bright. I have always been
a strong believer in the vision and the potential for Supply@
ME. It is a truly innovative offering. I am one of the longest
standing members of the team and I am very confident
we will do great things for the Italian market and beyond.
Our journey to date is a testament to perseverance and
unwavering commitment.
Team Q&A
Francesca Tomasi
Client and Sales Lead
Can you outline your career to date?
I joined Supply@ME in December 2022, initially as a Financial
Analyst in the Business Operations team, I moved from there
into the Sales and Marketing team where my career has
continued to grow into my current role of Client and Sales
Lead. My career trajectory has been marked by transitions
across various sectors, starting with large-scale distribution,
moving into the renewable resources sector, and ultimately
fulfilling my long-standing goal of working in the fintech
sector, with Supply@ME, in sales and marketing.
What attracted you to Supply@ME?
I first encountered Supply@ME when attending fintech
events focusing on smart contracts and the blockchain
model, an area of particular interest to me being the focus of
my Masters thesis. When I was approached by the Company
for an interview. I immediately accepted.
Alessandro Zamboni, our CEO, played a significant role in my
early interactions with the Company, which showcased their
commitment to fostering strong relationships and caring for their
team members. I was drawn in by the personal and proactive hiring
approach, this level of care and dedication really stood out to me.
Can you tell us about your role in Supply@ME?
My journey at Supply@ME began in the business operations
team, where I worked as a Financial Analyst. During this initial
phase, our team was small, and we all worked collaboratively
towards a common goal - being the pioneers in monetising
inventory held in warehouses in Italy and beyond.
Subsequently, I transitioned to Onboarding Supervisor
- Client Relationship. This role primarily focused on the
pre-trading phase, where I explained our services to clients
and guided them through initial due diligence and the
onboarding process. In essence, I served as the client’s main
point of contact throughout the entire journey, guiding them
from the initial stages to the point of monetisation.
34 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
into consideration before onboarding a prospective client.
Of course, none of our work would be possible without
the unique technological platforms we are building, so part
of my role also involves working with our technology and
product teams to convert these insights into a digital format
which we can use for analysis, monitoring and tracking.
What does the future look like from your perspective?
Supply@ME has a presence in its core markets of the
UK and Italy, and we continue to make progress in those
markets. However, the problem which Supply@ME solves is
global and impacts companies all over the world. So, while
we are prioritising building our pipeline in our core markets,
we always have an eye on the future and I look forward to
being part of our international ambitions.
Andrea Antonucci
Corporate and Inventory Analysis Associate
Can you outline your career to date?
My background is in corporate risk management and
analysis, which has given me a number of transferrable
skills relevant to my role at Supply@ME. I began my career
at CRIF, a credit bureau in Bologna, before moving onto
global professional services firm Deloitte, where I focused
on regulatory risk. I joined Supply@ME in 2020 as a Business
Analyst, before progressing to a more specialist role in
assessing the corporate credit history and inventory of
prospective and existing clients.
What attracted you to Supply@ME?
Building something new, a cutting-edge platform which hasn’t
existed before, really appealed to me. Supply@ME’s model
has the potential to make a difference to a huge number of
companies and revolutionise the way business approaches
working capital, and I wanted to be a part of that.
Coming from a one of the largest consultancy firms in the
world, I was really drawn by the tight-knit team culture at
Supply@ME. From my first meeting with CEO Alessandro
Zamboni, I have always felt valued for my skills and efforts. At
Supply@ME you are more than just a number; each and every
person has a role to play and is part of our team, which is
reflected in the support we receive from senior management.
We have built a culture which allows each person to make the
most of their strengths and have access to the people and
resources which can help us improve. We have achieved all of
this while embracing a remote working model, which is great
for achieving a healthy work/life balance.
Can you tell us about your role at Supply@ME?
I am a Corporate Credit and Inventory Analysis Associate,
which means I am responsible for assessing the eligibility
of prospective clients to use our Inventory Monetisation
services. I work very closely with our sales and marketing
team, liaising directly with clients to understand their
inventory cycles, sales patterns and other conditions we take
35 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Engaging with our Stakeholders
Our shareholders
The continued support of our shareholders is vital to the
long-term success of the business. We aim to engage with
our shareholders in line with the Group’s strategic objectives
and delivery of these, with the overall aim of delivering value
to all our stakeholders.
The Group continually seeks to improve its engagement with
its shareholders, both private and institutional investors.
During 2023 Supply@ME has continued to focus on
disseminating information to the market in a timely manner,
as well as monitoring and responding to communications in
the dedicated investor relations inbox, where it is possible
to respond, for shareholders to be furnished with non-
market sensitive information. As a growing business, with
limited bandwidth, it is not possible for our team to provide
an individualised response to each and every enquiry we
receive. However, every communication is reviewed and,
where possible, furnished with a full response as a priority.
This process will continue to evolve with the business.
In addition to the AGM presentation held in June, in May
2023 the Company invited investors to a presentation to
outline the opportunities for the business, demonstrate
how the Supply@ME business model addresses these
opportunities, and the Group’s relative position within the
relevant competitive landscape in more detail. After these
events the Supply@ME team reviewed and responded to a
significant number of shareholder questions. Additionally,
during 2023 Supply@ME has provided commentary on topics
relevant for global supply chains through a series of blogs
published on LinkedIn. Supply@ME continues to develop its
investor relations approach to provide more insights into the
Company through regular engagement and discourse.
The completion of the TradeFlow Restructuring on 30
June 2023 was an important step for the Group as it
will allow us to better serve both the needs of our client
companies and the funders of both businesses. It will
create value for the Company shareholders by eliminating
any perception of conflicts of interest between the two
businesses and providing both businesses with greater
commercial opportunities through the clear differentiation of
responsibilities of the individual entities.
Directors’ statement under section 172 (1)
The following disclosure forms the Directors’ statement
required under the Companies Act 2006 on how the
Directors have had regard to the matters set out in
section 172 (1) (a) to (f) in performing their duties. The
Board recognises that engagement with its stakeholders
is fundamental to the long-term success of the Group and
considers the views and interests of all key stakeholders in
its decision-making. Below is a summary of how the Board
engaged with each key stakeholder group during the year.
Our People
The Board recognises the critical importance of our team – a
motivated, committed, engaged workforce is essential for
the Group’s success. The CEO, who is an Executive Director
works closely and collaboratively with our global team, having
regular contact both formally and informally. The Chief
People Officer, Alice Buxton, regularly updates the Board
and has developed a People Strategy, focused on growing
the business’ people capability to enable successful business
growth and cultivating an engaged and high performing
workforce. There have been three All Hands meeting during
the year where Non-Executive Directors have spoken with
the team and provided insight into market disclosures as
they have been made. Enrico Camerinelli has taken on the
role of Board Sponsor for employees and Alexandra Galligan
is the Board Sponsor for Diversity, Equity, and Inclusion.
During 2023, our second employee experience and
engagement survey was undertaken to assess the employee
experience at Supply@ME. The results demonstrated
continued high scores relating to team members being
able to speak up and offer their views even if they are not
the most popular standpoint, which also supports the
recognition by the team of a diversity, equity, and inclusion
culture at Supply@ME being a business priority and a strong
appreciation of collaboration across the team. Scores in the
survey had also increased in relation to the team working
in line with the Supply@ME behaviours of collaboration,
innovation, delivery, and global thinking. All this provides
a solid foundation for the future. Areas of decreased
scores year on year highlighted a need to further develop
internal career growth opportunities to ensure the team
continue to develop their careers within Supply@ME and
the Group’s approach to reward. The results from the
survey have helped to develop the people focused goals
for 2024, continuing the focus on reward, recognition and
career growth for individuals to build skills, knowledge and
experience for the companies future success. The long term
incentive plan continues to be a key tool in rewarding and
retaining employees for reaching goals that lead to increased
shareholder value. The Board will continue to engage with
our people to ensure areas of importance are prioritised.
36 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Additionally, the CH Trading Hub will handle the token route,
the Group is continuing to work with the CH Trading Hub
on the launch of a security token framework which will allow
up to US$100 million to be issued and subscribed, mostly
by institutional investors active in the digital asset markets.
The security token is expected to be issued by a vehicle
sponsored by SFE and be tradeable on authorised digital
asset exchanges. This initiative facilitates the creation of a
new market in digital assets for interested investors.
White-Label Banks
During 2023 the Company worked to finalise the commitment
for the first White-Label IM transaction with BBPM, which was
announced on 3 January 2024. Potential White-Label banks
who use the technology and expertise provided by the Group
as inventory servicer and IM Platform provider, will benefit by
building a new unique service that they will be able to offer to
their own existing client base, or provide funding to corporate
clients who have been originated by Supply@ME and are in the
Group’s client pipeline.
Corporate Clients
Corporate clients, both current and prospective, are a
crucial stakeholder group for our business. Our Platform
is designed to be simple, allowing an unobtrusive user
experience. We want our clients to become advocates for
the business and we are committed to working with them to
refine the onboarding, trading, and monitoring processes.
Through continuous communication our client-facing
teams can build established relationships that ensure we
understand and meet their business needs. This includes
receiving regular feedback about our processes and product
solutions and enhancing them to ensure they are best in
class and continue to evolve as our customers business
and the commercial environment changes. Every piece of
feedback from prospective clients is also vital. We believe
wholeheartedly in our proposition, and every client we
onboard strengthens this belief. Ensuring that we reflect the
issues which potential clients face and that our proposition
is articulated appropriately is crucial to ensuring we realise
our potential. The Group has endeavoured to keep clients
up to date with likely timing of the completion of the IM
transaction, particularly in light of the challenges that have
been faced in connection with securing inventory funders
on a timely basis. Going forward the new relationship
with SFE should speed up this process as they will work to
ensure they have a pool of inventory funders available. The
team has also been working closely with the first UK client
company whose current financing facility has led to a delay
in the progress of the transaction to execution.
Inventory funders
Inventory funders are essential to our business, and the
ecosystem we support as providers of the IM Platform and
inventory servicers. We are focused on creating a new asset
class in which funders can confidently invest in inventory.
Where required we have and will evolve our business model
to ensure we are reflecting the feedback and views of
current and prospective funders, and regulators.
An example of this evolution is the collaboration with a group
of private investors and subject matter experts of working
capital solutions during 2023 to launch the CH Trading Hub
to replace the Cayman-based GIF, previously advised by
TradeFlow. The CH Trading Hub, will purchase, incorporate
and assume control of independent stock companies as
required to meet the needs of specific IM transactions, and
to manage the overall trading businesses using the Platform
and the associated services provided by the Group. This over
time will enable a multi-asset management model where
the Group can cooperate with further European and UK
authorised asset managers.
37 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Financial Review
Continuing operations
Revenue from continuing operations
2023
£000
2022
£000
Movement
£000
158
138
20
Operating loss from continuing operations before impairment charges and
fair value adjustments
(3,625)
(4,651)
1,026
Impairment charges
Fair value adjustments to investments
Operating loss from continuing operations
Finance costs
Loss before tax from continuing operations
Income tax
Loss after tax from continuing operations
Loss from discontinued operations
Total loss for the year
Total loss per share (“EPS”)
(384)
(1,078)
(68)
-
(4,077)
(5,729)
(83)
(1,982)
(4,160)
(7,711)
-
-
(4,160)
(7,711)
(185)
(2,167)
(4,345)
(9.878)
694
(68)
1,652
1,899
3,551
-
3,551
1,982
5,533
2023
Pence
2022
Pence
Movement
Pence
(0.0073)
(0.0228)
0.0155
38 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
The Group’s consolidated financial statements for the year
ended 31 December 2023 (“FY23”) have been prepared in
line with UK adopted International Accounting Standards
(“IAS”). The TradeFlow operations continued to be classified
as discontinued operations and assets held for resale in line
with the requirements of IFRS 5 (“Non-current Assets Held
for Sale and Discontinued Operations”) from 1 January 2023
until the date of completion of the TradeFlow Restructuring,
being 30 June 2023.
fees related to the following activities:
1) Origination fees - the origination of the contracts between
the client company wishing to have their inventory
monetised and the independent stock (trading) company
that purchased the inventory from the client company. In
line with IFRS 15 (“Revenue from Contracts with Customers”)
the Group recognised these revenues at the point in time
they are due to be received from the client;
2) IM Platform usage fees - usage of the Group’s IM
As shown in the financial summary on page 38, the
TradeFlow (discontinued) operations contributed a loss of
£185,000 (inclusive of the profit of £718,000 recognised in
connection with the TradeFlow disposal) in FY23, compared
to a loss of £2,167,000 from discontinued operations for the
year ended 31 December 2022 (“FY22”).
Revenue from continuing operations
2023
£000
2022
£000
Movement
£000
Revenue
Due Diligence fees
Inventory Monetisation fees
Total revenue from
94
64
102
36
continuing operations
158
138
(8)
28
20
The table above provides a breakdown of the Group’s
revenue from Inventory Monetisation activities during FY23.
Revenue is recognised in accordance with IFRS 15 (“Revenue
from Contracts with Customers”) and more details on the
Group’s revenue recognition policies can be found in the
note 2 to the Group’s FY23 consolidated financial statements
included within this Annual Report and Accounts.
During FY23, the Group recognised £158,000 (FY22: £138,000)
of Inventory Monetisation revenue, which it split 59% related to
due diligence fees (FY22: 74%), and the remaining 41% relating
to Inventory Monetisation fees (FY22: 26%).
In line with IFRS 15 (“Revenue from Contracts with
Customers”) the Group recognised the due diligence
revenues when the due diligence services have been
delivered and the Group’s performance obligation has been
satisfied. During FY23, the Group has continued to carry
out, and charge for due diligence activities, and the £94,000
recognised as revenue reflects the value of those due
diligence activities completed during FY23.
Following the announcement of the first Italian IM
transactions during 2022 and 2023, which were facilitated
using the Group’s IM Platform, the Group recognised
Inventory Monetisation fees of £64,000 during FY23. These
Platform, under a Software as a Service (“SaaS”) contract,
by the independent stock (trading) company to facilitate
the purchase of the inventory from the client company.
In line with IFRS 15 (“Revenue from Contracts with
Customers”) the Group recognised these revenues over
the time period they related to; and
3) IM service fees - the support and administration activities,
such as the monitoring of the inventory purchased, that
the Group performs in connection with the use of the
Group’s IM Platform. In line with IFRS 15 (“Revenue from
Contracts with Customers”) the Group recognised these
revenues over the time period they related to.
These revenues are expected to grow in future accounting
periods in line with expected growth in both the number of IM
transactions that are facilitated using the Group’s IM Platform
and, the quantum of inventory monetised by the independent
stock (trading) companies per transaction, increases.
Operating loss from continuing operations before
impairment charges and fair value adjustments
During the first half of 2023, the Group was focused on
securing the binding commercial agreements in terms of
the first IM transactions to use traditional funding in both
Italy and the UK. While the binding contract for the latter of
these two IM transactions was agreed in July 2023, there
has been a delay in the completion of the initial inventory
purchased which has largely been the result of the IM being
managed alongside an existing floating charge facility which
has required this client company to gain specific waivers
from their current lender. While this has resulted in delays to
this deal, it has proven that an IM transaction model is able
to work alongside existing financing facilities.
During the second half of 2023, the Group continued to
make important progress to enhance its business operating
model with continued differentiation of the IM Platform
including, not only the underlying software, but also the
supporting processes, methodologies and legal framework.
Alongside this, the Group has worked on developing a
new inventory funding framework through the launch of
CH Trading Hub, has spent considerable time and effort
securing its first commitment which will launch the Group’s
White-Label go-to-market strategy, and has been working
with various investment banks and digital asset providers
to explore and develop a wider variety of inventory funding
39 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Financial Review
routes. All these activities have continued into 2024 as
outlined in more detail elsewhere this Annual Report and
Accounts for the year ended 31 December 2023.
The Group recorded an operating loss from continuing
operations before impairment charges and fair value
adjustments for FY23 of £3,625,000 (FY22: £4,651,000
loss). The major contributing factors that resulted in the
reduction of the operating loss from continuing operations
before impairment charges and fair value adjustments of
£1,026,000 are described below:
> an aggregate decrease in the loss from gross profit and
administration expenses of £537,000 from £4,123,000
recognised in the year ended 31 December 2023,
compared to £4,660,000 recognised in the prior year
ended 31 December 2022. This decrease largely resulted
from focused cost saving efforts that were implemented
during 2023, in particular in the second half of the year
when the Group experienced cash flow pressures as
a result of delayed contractual funding amounts due
to the Group. In particular, the professional and legal
fees reduced by £643,000 during FY23 as management
made an effort to bring certain activities in house, staff
costs reduced by £211,000 during FY23 as certain staff
members who left during the year were not replaced,
either at all or immediately, and contractor costs reduced
by £59,000 during FY23 as the Group ended certain
agreements with contractors as specific activities that
were being worked on came to an end. When the Group
has sufficient cash balances in the future, management
will look to increase some of the costs again in order to
support and drive growth and expansion.The decreases
set out above were partially offset by:
> higher LTIP costs in FY23 as a result of a full 12 months
of charges in relation to the October 2022 LTIP grants,
compared to just two months of charges in FY22, and
seven months of charges of the May 2023 LTIP grants; and
> higher interest and penalty costs incurred across the
Group due to late payments being made as a result
of the delayed revenue generation and contractual
funding being received by the Group.
> an increase of £489,000 in the other operating income
recognised during FY23 to a total of £498,000 for the
current financial year compared to £9,000 recognised in
FY22. The majority of this increase arose as a result of a
settlement agreement reached with an existing supplier
during FY23 to reduce the total amount payable by
the Group in exchange for payment of a lower agreed
amount by a specific date. The difference in the previous
amount owed and the agreed final settlement amount
resulted in a gain recognised in the income statement of
£376,000 in FY23 (FY22: £nil). The other two main factors
contributing to the increase in other operating income in
the current financial period are:
> an increase in interest income recognised during FY23
of £25,000 compared to the prior period. This interest
income was charged on late payment of contractual
amounts due to the Group; and
> an amount of £87,000 recognised during FY23 (2022:
£nil) which relates to claims made in Italy for research
and development tax credits relating to the 2021 and
2022 financial years. These amounts are expected
to be utilised by the Group over the next three years
from 2024 to 2026, in equal instalments each year, to
reduce the balance of other Italian tax payables.
Impairment charges and fair value adjustments from
continuing operations
Impairment charges from
continuing operations
Fair value adjustment on
investment in TradeFlow
2023
£000
2022
£000
Movement
£000
384
1,078
694
68
-
452
1,078
(68)
626
The impairment charges from continuing operations of
£384,000 recognised during FY23 relate to the impairment
of the Group’s internally developed IM platform as at 31
December 2023 in line with the requirements of IAS 36
(“Impairment of Assets”). This followed the conclusion that
indicators of impairment were present, which included the
losses continued to be generated by the assets held by
the Group’s Italian operating subsidiaries. In line with the
going concern statement, set out in note 2 to the Group’s
FY23 consolidated financial statements included within this
Annual Report and Accounts, there is currently a material
uncertainty with respect to both the future timing and
growth rates of the forecast cash flows arising from the use
of the internally developed IM Platform intangible asset. As
such, the Directors have prudently decided to continue to
impair the full carrying amount of this asset of £384,000 as
at 31 December 2023 (2022: £1,078,000).
The fair value adjustment to the investment in TradeFlow
of £68,000 recognised during FY23 (2022: £nil) reflects the
worsening of the net liability position of TradeFlow between
30 June 2023, being the date of disposal is the 81% stake
in TradeFlow, and the year end balance sheet date of 31
December 2023. The quantum of the fair value adjustment has
been determined with reference to the value of the change
in the net liabilities of TradeFlow between these two dates.
40 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Discontinued Operations
Revenue from discontinued operations
Administrative expenses
Other operating income
Amortisation of intangible assets arising on acquisition
Acquisition related earn-out payments
Impairment charges
Foreign currency translation loss reclassified to comprehensive income
Profit on disposal of 81% of TradeFlow
Operating loss from discontinued operations
*
Represents the results for the six-month period prior to the finalisation of the TradeFlow Restructuring on 30 June 2023.
6 months to
30 June 2023*
£000
684
2022
£000
629
(1,037)
(1,705)
22
(846)
710
(765)
-
24
(442)
-
-
(62)
718
(115)
(1,955)
The revenue and operating loss of the TradeFlow operations
for the period from 1 January 2023 through to the date on
which the TradeFlow Restructuring was completed, being
30 June 2023, are shown in the table above. As detailed
earlier, the TradeFlow operations continued to be classified
as discontinued operations and assets held for resale in
line with the requirements of IFRS 5 (“Non-current Assets
Held for Sale and Discontinued Operations”) from 1 January
2023 and up until 30 June 2023. After this point, TradeFlow
was no longer consolidated by the Group and instead
the Group now recognises the fair value of the remaining
19% investment in TradeFlow on its balance sheet as an
investment. The comparatives show the revenue and
operating loss of the TradeFlow operations for the full year
ended 31 December 2022.
TradeFlow’s investment advisory revenue arose from
investment advisory services provided in TradeFlow’s capacity
as investment advisor to its well-established USD fund and
its growing EUR fund. In line with IFRS 15 (“Revenue from
Contracts with Customers”) these revenues were recognised
when the investment advisory services have been delivered
and TradeFlow’s performance obligation has been satisfied.
Further details of the costs recognised in during the first six
months of 2023 prior to the completion of the TradeFlow
Restructuring on 30 June 2023 that are set out in the table
above are detailed below:
> amortisation of intangible assets arising on acquisition of
£442,000 during FY23. These costs related to the intangible
assets recognised by the Group in connection with the
TradeFlow acquisition, which had an initial fair value of
£6,888,000. The £442,000 represents the amortisation
charge arising on these assets for the six month period from
1 January 2023 through to the date on which the TradeFlow
Restructuring was completed, being 30 June 2023;
> foreign currency translation loss reclassified to
comprehensive income of £62,000 during FY23. This
represents the cumulative foreign currency translation
reserve created on consolidation in respect of the
TradeFlow operations. This is reclassified to income
statement at 30 June 2023 due to TradeFlow no longer
being consolidated by the Group from this date; and
> the profit on disposal of the 81% of TradeFlow of
£718,000. On the 30 June 2023, the net assets of
TradeFlow (representing a value of £1,634,000 at 30
June 2023) are no longer consolidated by the Group,
and instead the fair value of the new 19% investment of
£352,000 was recognised on the balance sheet, together
with the £2,000,000 remaining cash consideration
to be received. The difference between these items
resulted in a profit on disposal of the 81% of TradeFlow
recorded in the Group’s FY23 consolidated statement of
comprehensive income of £718,000.
As shown above there were no additional acquisition related
earn-out costs recognised during 2023 which reflected the
fact that as part of the TradeFlow Restructuring all future
potential earn-out payments were offset against the initial
cash consideration value.
As detailed above, following the finalisation of the TradeFlow
Restructuring on 30 June 2023, the assets and liabilities
of TradeFlow, including the intangible assets arising as
part of the original TradeFlow acquisition in July 2021, are
no longer consolidated by the Group. As such no further
impairment charges relating to the discontinued operations
were recognised during 2023. Instead, a calculation was
undertaken to calculate any gain or loss arising on the
change in ownership structure of the TradeFlow operations.
41 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Financial Review
The details of this calculation are set out below, and
further detail can be found in note 26 to the Group’s FY23
consolidated financial statements included within this Annual
Report and Accounts.
As at
30 June
2023
£ ‘000
Accounting fair value of the 81% ownership of the
TradeFlow operations disposed of by the Group
2,000
Accounting fair value of 19% ownership of the
TradeFlow operations retained by the Group
Less:
Accounting fair value of net assets disposed of by
the Group
Profit on disposal of 81% of TradeFlow
352
2,352
(1,634)
718
With regards to the £2,000,000 remaining cash
consideration that was due to the Company as a result of
the TradeFlow Restructuring, this amount was assumed by
The AvantGarde Group S.p.A (“TAG”), the Group’s majority
shareholder, from the buyers of the 81% stake in TradeFlow
by way of a debt novation deed signed on 30 June 2023.
The £2,000,000 was to be repaid by TAG to SYME in
multiple tranches, with the final tranche being due by 31
January 2024. As at 31 December 2023, £772,000 remained
outstanding from TAG in relation to this amount (31
December 2022: £nil), of which £227,000 was overdue and
£500,000 was due for payment on 31 January 2024.
Subsequent to 31 December 2023, and prior to the release
of the Group’s FY23 consolidated financial statements
included within this Annual Report and Accounts, TAG
had repaid £655,000 of the remaining amounts that were
outstanding at 31 December 2023, through a combination
of £569,000 cash payments and a further £86,000 offsets
against amounts owed by the Group to TAG.
The Company has been charging a late fee to TAG in terms
of overdue payments of this particular receivable balance,
and this late fee is calculated at a compounding rate of
15% per annum on any amounts of the instalments not
transferred to the Company by the relevant due date, in
accordance with the contractual arrangements. During
the year ended 31 December 2023, the Group recognised
£11,000 of interest revenue (2022: £nil) in relation to the
late payments by TAG in respect of this particular receivable
balance. As at 31 December 2023, the full amount of this
interest revenue remained outstanding.
To determine the accounting fair value of the retained 19%
investment in TradeFlow of £352,000, management used the
specifics set out in the TradeFlow share purchase agreement
dated 30 June 2023. Further details of this calculation are
set out in note 26 the Group’s FY23 consolidated financial
statements included within this Annual Report and Accounts.
Following this calculation, management then applied a
discount of 25% to this fair value to take account of the
fact that the Company no longer controls the TradeFlow
operations. This discount applied is a management
judgement that will continue to be reassessed at each
reporting date.
New equity funding
On 28 April 2023, the Company and Venus Capital S.A.
(“Venus Capital”) entered into a new equity subscription
agreement, pursuant to which Venus Capital committed
to subscribe for 4,500,000,000 new ordinary shares
(the “Subscription Shares”) at £0.0005 per Subscription
Share (the “Subscription Agreement”) over two separate
tranches, both of which took place in May 2023. The total
gross proceeds received by the Group in relation to this
Subscription Agreement was £2,250,0000 or £2,137,500
net of the £112,500 commission that was charged by Venus
Capital in connection with the issue of the Subscription
Shares. An additional £112,500 was paid to Venus Capital
in respect of agreed costs and expenses incurred by Venus
Capital in connection with the Subscription Agreement.
The Subscription Agreement required new warrants to be
issued to Venus Capital at a ratio of one warrant for every
two Subscription Shares issued. This resulted in an obligation
for the Group to issue 2,250,000,000 new warrants to
Venus Capital (“New Venus Warrants”) which existed at
31 December 2023. The New Venus Warrants are each
exercisable into one new ordinary share at a price equal to
£0.00065 pence per share up to a final exercise date of 31
December 2026. As at 31 December 2023, the obligation
to issue these share warrants to Venus Capital has been
recognised within equity as “warrants to be issued” within
the share-based payment reserve. These share warrants
had a total fair value of £1,717,000. As at 31 December 2023,
all of these share warrants remain outstanding.
The total share issue costs incurred in connection with
the Subscription Agreement during FY23 were £1,971,000
including £1,717,000 relating to the fair value of the warrants
issued, £225,000 relating to the commission and other
fees charged by Venus Capital and £29,000 of other share
issue costs. This has been accounted for as a £1,971,000
reduction to share premium during FY23 given there
was sufficient share premium created on the issue of the
Subscription Shares.
42 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
New debt financing
In addition to the new equity funding referred to above, the
Group also needed to secure new debt financing during
FY23 to support the working capital needs of the Group
while it continues to fully establish the business model
and create a track record of revenue generation. This has
presented a number of challenges to the Group, not only
due to the general challenging economic and commercial
environment throughout 2023, including the high interest
rate environment and its impact on economic prospects
and investor sentiment, but also the start-up nature
Group’s business as this in itself significantly limits funding
options compared with larger, more mature, UK businesses
especially in the fintech sector. With these factors in mind,
the Board carefully considered what options were available
and concluded that entering into the following debt financing
with TAG, the Group’s major shareholder, were in the best
interests of the Group and its shareholders. Details of the
new debt financing arrangement entered into with TAG
during FY23 are summarised below.
TAG Unsecured Working Facility
On the 28 April 2023, the Company and TAG entered into a
fixed term unsecured working capital loan agreement (the
“TAG Unsecured Working Capital facility”). This agreement
was subsequently amended on 30 June 2023 in conjunction
with the TradeFlow Restructuring. Under the amended TAG
Unsecured Working Capital facility, TAG agreed to provide,
subject to customary restrictions, an unsecured working
capital facility of up to £800,000 to cover the Group’s interim
working capital and growth needs.
On 30 June 2023, the Company issued a draw down notice
to TAG under the amended TAG Unsecured Working facility
for the full £800,000 available. As at 31 December 2023,
TAG had provided £250,000 of the £800,000 that had been
drawn down by the Company (31 December 2022: £nil),
however subsequent to 31 December 2023, and prior to the
release of Group’s FY23 consolidated financial statements
included within this Annual Report and Accounts, TAG had
provided the remaining £550,000 of the £800,000 that had
been drawn down by the Company.
The initial due date for repayment by the Company of
amounts (if any) drawn under the TAG Unsecured Working
Capital facility was 1 February 2028, however on 26 March
2024, the Company and TAG signed a second deed of
amendment agreement, which allowed the full outstanding
amount of the amended TAG Unsecured Working Capital
facility, being £800,000, to be extinguished by the issue of
1,500,000,000 new ordinary shares which were issued to
TAG on 28 March 2024.
Any sums drawn under the TAG Unsecured Working Capital
facility attracted a non-compounding interest rate of 10% per
annum, on any principal amount (excluding accrued interest).
During the year ended 31 December 2023, the Company
recognised interest expense of £7,000 (2022: £nil), which all
remained unpaid as at 31 December 2023, which was settled
in full as part of the repayment made on the 28 March 2024.
Top-Up Shareholder Loan Agreement
On 28 September 2023, the Company and TAG entered
into a unsecured shareholder loan agreement (the “Top-
Up Shareholder Loan Agreement”), pursuant to which TAG
agreed to provide the Company with a further facility of up
to £3,500,000 to cover the Company’s working capital and
growth needs up to 30 June 2025.
Full details of this Top-Up Shareholder Loan Agreement are
set out in note 28 to the Group’s FY23 consolidated financial
statements included within this Annual Report and Accounts.
In summary, under the Top-Up Shareholder Loan Agreement
the Company has the ability to draw down up to £3,500,000
in monthly instalments over the period to 30 June 2025, with
the monthly drawdown amount calculated in order to ensure
that the Group’s projected cash balance on the last business
day of the coming calendar month will not be less than
£250,000 after taking into account the Group’s scheduled
balance of receipts and payments for the next month.
The repayment of any sum drawn down under the TAG
Top-Up Shareholder Loan Agreement will be due five
calendar years from the date which funds are received by
the Company subject to the relevant draw down request
and any sums drawn down by the Company under the TAG
Top-Up Unsecured Shareholder Loan will attract a non-
compounding interest rate of 10% per annum, and any
principal amount (excluding accrued interest) outstanding
on a relevant due date shall attract a compounding rate of
15% per annum thereafter. Interest will be due to be paid
annually on 31 March of each relevant calendar year.
As at 31 December 2023, the Group had issued draw
down notices to the value of £969,000 to TAG, however
these amounts had not yet been received by the Group (31
December 2022: £nil). As a result of the late payment of the
amounts drawn down by TAG, the Group recognised interest
income of £11,000 (2022: £nil), which all remained unpaid as
at 31 December 2023.
43 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Financial Review
Subsequent to 31 December 2023, and prior to the release
of the Group’s FY23 consolidated financial statements
included within this Annual Report and Accounts, the
Company issued additional draw down notices under
the Top-Up Shareholder Loan Agreement to the value of
£779,000 and had received £nil from TAG.
Late payment challenges encountered by the Group
during 2023
As previously commuicated by the Company through its
RNS announcements dated 5 December 2023 and 29
February 2024, the Group has experienced a number of
cash flow pressures during the second half of 2023, and to
date in 2024, as a result of a number of delayed contractual
funding amounts due to the Group from TAG. The delayed
contractual payments resulted from TAG experiencing
delays in funding it was itself expecting. The Board has been
monitoring the situation closely including requesting regular
updates from TAG regarding the expected timing delays,
and representation as to the mitigating actions that TAG
itself has been putting in place to allow them to demonstrate
their ongoing commitment to support the Company and
to provide the contractual payments, albeit on a delayed
payment schedule.
As detailed above, the Group has continued to receive
payments from TAG following 31 December 2023 and
TAG has provided further representations to the Board
that it will continue to provide the outstanding amounts,
and that TAG is itself in the process of securing additional
facilities and arrangements to enable performance against
these representations. Additionally, the Board is exploring
alternative options of funding in order to meet its ongoing
working capital needs and to reduce the reliance of the
Group on TAG.
Cash flow
The Group decreased its net cash balance by £575,000
(2022: £1,133,000 decrease) due to a combination of the
following cash inflows and outflows during FY23:
> cash inflow of £2,068,000, net of commission and other
share issue costs, received from the issue of new ordinary
shares during the first half of 2023 under the Subscription
Agreement, and from existing warrant holders who chose
to convert their warrants (which had been issued in
conjunction with the Open Offer completed during 2022);
> cash inflows from long-term borrowing from discontinued
operations of £405,000 due to the new long-term
borrowings secured by TradeFlow during the six-month
period in 2023 prior to the completion of the TradeFlow
Restructuring;
> cash inflows from long-term borrowing from continuing
operations of £139,000, net of repayments and other
finance costs, predominantly due to amounts received
under the amended TAG Unsecured Working facility agreed
during 2023 less the cash repayments made during 2023 in
relation to the long-term bank borrowings; and
> cash inflow of £1,228,000 that have been received during
the year ended 31 December 2023 from TAG in relation
to the repayment of the remaining cash consideration
that was due as a result of the TradeFlow Restructuring.
These net cash inflows were then offset by the following items:
> net outflows from operating activities of £3,633,000
(2022: £4,555,000 net outflow);
> continued investment in the Group’s IM Platform of
£458,000 (2022: £1,175,000); and
> removal of the opening cash balance of the TradeFlow
operations of £324,000 to reflect the fact that the
TradeFlow Restructuring was completed on 30 June 2023
and the TradeFlow assets and liabilities are no longer
consolidated by the Group at the period end.
2023
£000
2022
£000
Net cash flow from operating activities
(3,633)
(4,555)
Net cash flow from investing activities
446 (1,197)
Net cash flow from financing activities
2,612
4,619
Net (decrease) in cash and
cash equivalents
(575)
(1,133)
Foreign exchange differences to cash
and cash equivalents on consolidation
(1)
(13)
Cash and cash equivalents at 1 January
581
1,727
Cash and cash equivalents as at 31
December
5
581
Net liabilities
As at 31 December 2023 the Group’s net liabilities were
£3,807,000 (31 December 2022: net liabilities of £2,025,000),
representing an increase in the net liability position of the
Group of £1,782,000.
The increase in the net liability position at 31 December
2023 compared to 31 December 2022 is largely due to the
following:
> the addition of the new assets created as a result of
the TradeFlow Restructuring including a) the £772,000
outstanding cash consideration receivable by the
Company from TAG as at 31 December 2023 (31
December 2022: £nil), following TAG’s assumption of the
outstanding cash consideration payable from the buyers
of TradeFlow on 30 June 2023, and b) the £284,000
44 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
investment balance relating to the fair value of the
Group’s remaining 19% ownership of TradeFlow as at
31 December 2023. Further details on these new assets
can be found in notes 26 and 27 to the Group’s FY23
consolidated financial statements included within this
Annual Report and Accounts.
This increase in assets compared to 31 December 2022 was
then offset by:
> the removal of the assets and liabilities relating to
TradeFlow from the Group’s consolidated balance sheet
at 30 June 2023 to reflect the fact that the TradeFlow
Restructuring was completed on this date. The value of
the net asset relating to TradeFlow that were consolidated
as at 31 December 2022 was £2,283,000;
> the reduction in the cash balance from continuing
operations from £257,000 as at 31 December 2022 to
£5,000 as at 31 December 2023 reflecting a number of
delayed contractual funding amounts due to the Group
from TAG in the second half of 2023;
> an increase in provisions from £468,000 as at 31
December 2022 to £575,000 as at 31 December 2023
reflecting additional interest amounts and penalties due
on overdue tax and social security balances due;
> an increase in long-term liabilities reflecting the balance of
the TAG Unsecured Working Capital facility of £250,000 as
at 31 December 2023 (31 December 2022: £nil);
> a small increase in other working capital items primarily
due to the overall net cash outflows from operations.
Going Concern
The Board’s assessment of going concern, the key
considerations and the material uncertainties thereto are set
out in the note 2 to the Group’s FY23 consolidated financial
statements included within this Annual Report and Accounts.
Related Parties
Note 28 to the Group’s FY23 consolidated financial
statements included within this Annual Report and Accounts
contains details of the Group’s related parties.
Subsequent events
Note 30 to the Group’s FY23 consolidated financial
statements included within this Annual Report and Accounts
contains details of all subsequent events.
45 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Environmental, Social and Governance Review
The Group recognise the importance of considering and
managing our impact on society and the environment as well
as protecting and developing the business’ long-term value
for its shareholder base. Consideration has been given to
how to assess, measure and manage this impact over and
above that which is required from a statutory perspective
and managing and leveraging the Groups opportunity to
have a positive impact. Supply@ME recognise that the
Group has the ability to have a positive impact in this area
and intends to continually develop its approach. Key to this
approach will be ensuring that consideration is being given
to the Environmental, Social and Governance (“ESG”) impacts
of the business as its builds its track record of successful IM
transactions executed over its Platform.
Environmental
Company aspiration
The aspiration’s for the Company’s environmental impact
stated in the 2022 Annual Report remain consistent and
during 2023 Supply@ME continued to work on this basis:
> Continuing to keep energy consumption as low as
possible, exploring ways to reduce or offset this as the
business grows.
> Continuing to utilise technology to avoid unnecessary
travel, especially given the staff and directors are based in
a number of different locations.
> During 2024 the Group intends to further consider
building on voluntary disclosures, considering the impact
and business supply chain in particular scope 3 emissions
tracking and calculation. An internal working group will be
formed, and external advice will be sought as required.
2023 update
During 2023, the Group continued to be a low energy
user, using less than 40 MWh per annum. As required by
the Companies Act 2006 (Strategic and Directors Report)
Regulations 2013 and the Companies (Directors’ Report) and
Limited Liability Partnerships (Energy and Carbon Report)
Regulations 2018 the Directors have undertaken a review of
the Group energy consumption and associated emissions.
The Group uses significantly less than 40MWh of energy per
year and is therefore classed as a low energy user by the
regulations, as a consequence of which it is exempt from
reporting annual emissions, energy use and an intensity ratio.
Below is voluntary reporting to provide more detail of this
assessment and aspirations for the future. As the Group
grows we intend to make more detailed disclosures.
sharing spaces or managed offices are rented for company
meetings. The business does not own vehicles and focuses
on using technology as a means of communication which
limits business travel, for example all 2023 Board meetings
having taken place via video conference with the exception
of the Board strategy day held in March 2023 and the 2023
AGM which was held in London in order to give shareholders
the chance to attend in person. In respect of the Board
strategy day in March 2023, no air travel was used and video
conferencing was utilised for those members who would
have been required to use this mode of transport to attend.
Prior to the TradeFlow Restructure which was completed on
30 June 2023, the Group owned 100% of TradeFlow. During
this time, TradeFlow continued to rent its office space but
did not use heating fuel.
Scope 2 emissions and associated energy usage
These emissions relate to electricity and / or heat supplied
to an organisation. No part of the organisation is directly
supplied with or pays for electricity. TradeFlow lease an office,
electricity usage being part of the rental fee. The total electricity
use of the organisation is therefore restricted to the supply to
the Singaporean office for the first six months of 2023 when
TradeFlow was a wholly owned subsidiary of the Group.
Scope 3 emissions
These emissions are the result of activities from assets not
owned or controlled by the reporting organisation, but that
the organisation indirectly affects in its value chain.
Since December 2020, TradeFlow advised funds have been
one of the first trade funds in the world to start buying
carbon credits, with the aim of netting off carbon emissions
from transportation related to the funds TradeFlow advises.
Reporting in this area is something that the Group will look
to develop in the future as the business starts to scale.
Social Capital
Company aspiration
Supply@ME aims to have a positive impact on society and
will continue to illicit feedback from our key stakeholders on
mechanisms through which to achieve this aim.
2023 update
The Group seeks to reach the highest ethical standards and
behaviours when conducting our business, and to ensure this
is done with integrity, openness and appropriate protections
for those with whom our business interacts and impacts.
Scope 1 emissions and associated energy usage
These emissions are directly related to combustible fuel,
used for heating company premises and / or powering
company owned vehicles. The UK and Italian businesses are
remote first and do not own or lease offices. At times desk
The Group’s Platform, by its nature, helps businesses to
free up working capital earlier in their production or sales
cycle through the facilitation of Inventory Monetisation
transactions. Inventory Monetisation also allows trading
46 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
businesses to buy and hold more inventory in warehouse,
potentially resulting in fewer deliveries (facilitating a lower
carbon footprint from reduced supplier haulage).
The business has continued to take a proactive approach
to data protection recognising the importance of data
management as the business grows.
As part of the 2023 Employee Experience and Engagement
survey employee’s views on how Supply@ME could have
a positive social impact in their community were elicited.
These views will be incorporated into the Companies future
approach to social capital.
Human Capital
Company aspiration
Continue to build a diverse, inclusive organisation which
offers opportunities for growth and development for all
employees and contractors.
2023 update
During 2023 and early 2024 the team have had a range of
opportunities for growth. Career paths and development
plans were built to help guide career growth. Internal
development opportunities have been Self Leader, Sales
Training and Manager and Leadership Training. Additionally,
the whole team are developing their understanding of
Digitalisation of Assets through training by Route Crypto
Training. The first internal promotions recognising
individuals’ growth with the Company were awarded during
2023. The Board and leadership team are focused on
retaining talent and growing careers through what has been
a challenging year for the team due to the delays in funding
the business has faced.
The 2023 Employee Experience and Engagement Survey
highlighted that 94% of the team recognise that at SYME we
believe diversity, equity and inclusion are a business priority,
average scores having increased year on year from 2022.
This has also been supported by Alexandra Galligan being
appointed as the Board Diversity Champion.
Supply@ME’s equal opportunities policy aims to ensure
that the work environment is free from direct and indirect
discrimination on the grounds; of race, sex, disability,
sexual orientation, gender reassignment, marriage or civil
partnership, pregnancy or maternity, religion or belief or age,
and enables everyone to achieve their potential.
Having a global mindset, being collaborative and embracing
differences are fundamental to our corporate culture. They run
deeply through our people practices, including in recruitment,
performance management and development of the team. In
addition to the behaviours of innovation and focusing on delivery.
Business Model and Innovation
Company aspiration
Robust, systematic ESG assessment of potential users of our
Platform to become a core element of due diligence.
2023 update
Supply@ME aims to have a positive impact on the
environment, society and our stakeholders. During 2023
the Company has continued to evolve our ability to assess
potential inventory funders overall ESG strategy and appetite
to ensure potential client companies ESG impact is being
taken into consideration during the onboarding and due
diligence process. This allows potential inventory funders
to be informed of the corporate clients ESG assessment
which will enable them to take a proactive approach to ESG
management and client company selection. To support
the ESG assessment made during the due diligence phase,
details are requested from clients in respect of their ESG
policies, frameworks and risk assessments. This feedback
compliments the consideration given to a potential client’s
jurisdiction, size and industry. This information can then be
shared with potential inventory funders.
Leadership and Governance
Company aspiration
Further development and disclosure of proactive internal
risk management processes in line with business growth.
2023 update
During 2023 the sale of 81% of TradeFlow was completed
recognising the evolution of the regulation of the fund
management industry and to cater to the needs of potential
inventory funders who had expressed a desire to see a
segregated structure of the Platform provider from the
fund. This demonstrates the focus on ensuring effective
governance of the business and our willingness to adapt
to meet these requirements. The new structure with SFE is
designed to enable us to scale the offering of Supply@ME as
specialist inventory servicer with a stable partner in the CH
Trading Hub.
The Company is a listed business which complies with
the QCA Corporate Governance Code. Risk is regularly
considered by the Board and a proactive approach is taken
to risks identified, most recently through the application
of the COSO (Committee of Sponsoring Organizations of
the Treadway Commission) framework. Legal advice and
guidance are sought from external experts, as and when
required, in addition to a small inhouse team.
47 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Task Force on Climate-Related Financial Disclosures
TCFD statement
We are committed to providing information about climate-
related risks and opportunities that are relevant to our
business. As outlined on the previous pages we are evolving
our ESG strategy and governance framework, to take
account of these risks and opportunities whilst balancing
this with the current business environment. Below are our
climate related disclosures aligned with the requirements of
LR 9.8.6R by including disclosures consistent with the TCFD
recommendations and disclosures. We also recognise that
this specific statement was omitted from our 2022 annual
report and accounts. We have also included how this relates
to the BEIS mandatory climate-related financial disclosure
requirements under the Companies (Strategic Report)
(Climate-related Financial Disclosure) Regulations 2022.
Our disclosures are not yet at the level consistent with
the requirements, the leadership team and Board will be
working towards compliance during 2024. Our intention is
to create an internal working group and engage external
advisors to support us on this journey.
TCFD Recommendation
BEIS Disclosure and Compliance Status
Commentary
Governance
a) Describe the Board’s oversight of
climate-related risks and
opportunities.
b) Describe management’s role in
assessing and managing climate-
related risks and opportunities.
a) A description of the governance
arrangements of the Company in
relation to assessing and managing
climate-related risks and opportunities.
Partially compliant
Outlined in our ESG section of the
annual report on pages 46–47 we
explain the importance placed on
ESG by the Group and it’s
governance. Both the leadership
team and Board were involved in
developing and approving the
approach and consideration given
to ESG, with it being a topic for
discussion at the Board strategy day
in March 2023. It is also embedded
into the Company’s risk
management approach.
Strategy
a) Describe the climate-related risks
and opportunities identified over
the short, medium and long term.
b) Describe the impact of climate-
related risks and opportunities on
business, strategy and financial
planning.
(d) A description of: (i) The principal
climate-related risks and opportunities
arising in connection with the
operations of the Company. (ii) The
time periods by reference to which
those risks and opportunities are
assessed.
Partially compliant
e) A description of the actual and
potential impacts of the principal
climate-related risks and opportunities
on the business model and strategy of
the Company.
Partially compliant
The Group does not consider there
to be any material climate related
risks and therefore no material
climate related impacts that require
disclosure. However, the strategy
with regard to climate risks and the
Company’s approach to it’s impact
on the environment can be seen on
page 46 in the Environmental
section of our ESG Review.
During 2024 this approach will be
further developed with regard to
the potential impacts of a changing
environment on the Supply@ME
business.
c) Describe the resilience of the
strategy, taking into consideration
different climate-related scenarios,
including a 2°C or lower scenario.
f) An analysis of the resilience of the
business model and strategy of the
Company, taking into consideration of
different climate-related scenarios.
Does not comply
48 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
TCFD Recommendation
BEIS Disclosure and Compliance Status
Commentary
Risk Management
a) Describe the processes for
identifying and assessing climate-
related risks.
(b) A description of how the Company
identifies, assesses, and manages
climate related risks and opportunities
b) Describe the processes for
managing climate-related risks.
Partially compliant
c) Describe how processes for
identifying, assessing, and managing
climate-related risks are integrated
into overall risk management.
c) A description of how processes for
identifying, assessing, and managing
climate-related risks are integrated into
the overall risk management process in
the Company
Partially compliant
Climate related risk is embedded
into our overall risk management
approach, detail of this can be
found on page 50.
Additional details of the Company’s
approach to environmental impact
can be found on page 46.
Metrics and Targets
a) Disclose the metrics used to
assess climate-related risks and
opportunities in line with the
strategy and risk management
process.
b) Disclose Scope 1, Scope 2, and, if
appropriate, Scope 3 greenhouse gas
(GHG) emissions, and related risks
.
c) Describe the targets used to
manage climate-related risks and
opportunities and performance
against targets.
(h) The key performance indicators
used to assess progress against targets
used to manage climate-related risks
and realise climate-related
opportunities and a description of the
calculations on which those key
performance indicators are based.
Does not comply
(g) A description of the targets used by
the Company to manage climate-
related risks and to realise climate-
related opportunities and of
performance against those targets.
Does not comply
Supply@ME is a low energy user,
using less that 40MWh per annum.
Detail of the Company’s energy use
is provided on page 46, including
commentary around Scope 1, 2 and
3 emissions. As the Group grows
more detailed disclosures in this
area will be issued. As there are no
material climate related risks
identified at this time no other
specific targets are set in relation to
climate risk. The Company’s
aspirations in this regard can be
seen on page 46.
Aspirations around the Company’s
approach to climate related risks
can be found in the ESG section of
this report on page 46.
49 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Principal Risks and Uncertainties
The Group’s approach to risk management is that the Board
regularly considers the principal risks faced by the Group
and takes a proactive approach to those risks identified,
primarily through the application of the COSO (Committee
of Sponsoring Organizations of the Treadway Commission)
framework. The leadership team have undertaken a
bottom-up internal self-assessment approach to evaluating
risks across all areas of the business in line with the COSO
framework. Consideration was given to perceived risk with
regard to Impact, Likelihood, Vulnerability and Velocity by
internal functional experts. The identified risks were then
reviewed and assessed centrally and key risks to the business
are managed and mitigated. The key risks and mitigations are
periodically presented to the Board and Audit Committee.
The most significant risks and uncertainties the Group faces
are listed in the table below, categorised by the principal risk,
together with the approach that has been taken to manage
the impact of this risk on the Group, any changes to the risk
profile since 2022 and an assessment of the importance of
this risk considering the likelihood and impact of it post the
mitigations outlined.
Strategic risk
Strategic risk is defined as the failure to build a sustainable, diversified and profitable business that can successfully adapt to
environment changes due to the inefficient use of Group’s available resources.
Business Model and Strategic Competition
Movement since 2022
Maintained at same level
Likelihood
Unlikely
Impact
Major
Principal Risk
How are we mitigating this risk?
Change in principal risk since 2022
The Group’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.
By its nature this is a new FinTech
product which leads to an inherent
risk of there being limited market
interest in the product or on the
converse a competitive offering
being created by another
organisation which outstrips our
model or size.
The progress made during 2023 in
the commencement of the variety of
routes to market and the associated
ability in the Group gives strategic
competitive advantage, alongside the
flexibility in the business model.
Although there have been
announcements from other
companies with regard to
progressing their own inventory
funding model, Supply@ME is not
aware of any other offering of
Inventory Monetisation facilitated
through a platform aligned to the
Supply@ME business model. The
investments made since the Group’s
inception would be challenging for a
competitor to replicate over a short
period at this stage.
The Group continues to
acknowledge the risk of new and
potentially larger competitors
entering the Inventory Monetisation
space and regularly monitors new
entrants to keep abreast of changes
to this risk factor.
Over the past few years, a focus for
the Group has been significantly
investing in building, developing and
flexing its unique model. It has also
diversified the business model to
encompass a variety of routes to
market from White-Label product
offerings, tokenisation and traditional
inventory funding. Additionally, as
detailed in the how we adapt to scale
the business section of this annual
report and accounts on pages 13–14
the Group’s understanding and
ability to deliver for a range of client
companies business model adds to
its competitive advantage, especially
against potential new entrants to the
market place.
50 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Future Development and Strategy
Movement since 2022
Maintained at same level
Likelihood
Possible
Impact
Major
Principal Risk
How are we mitigating this risk?
Change in principal risk since 2022
The Group is unable to build the IM
Platform in line with its strategy at a
pace and cost aligned to funding
available and revenue generation.
During 2023, the Company has
proven its ability to deliver an
additional successful Inventory
Monetisation and worked hard to
secure its first commitment linked to
the While-Label product offering,
which was then announced in early
2024. These developments
demonstrate the establishment of
the business model and product.
However, the pace of growth is
slower than anticipated and as such
the scalability of the business model
is still to be fully demonstrated.
This risk will reduce as the Group’s
business model and product
becomes more established. Despite
business progress made during 2023,
the scalability of the Group’s product
remains unproven, which could affect
the Group’s ability to increase
revenues and profit margins in the
future at the rate needed to ensure
success of the business model.
The key to our long-term business
growth remains our IM Platform. The
IM Platform and product roadmap are
continually being enhanced to enable
seamless interactions with clients and
inventory funders, with minimal
human intervention, using a lean
workforce to deliver a high volume of
transactions and revenue. This
groundwork will allow for increased
efficiency going forward and will
continue to be progressed as different
inventory models are presented to the
Group for consideration.
51 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Principal Risks and Uncertainties
Macro Global and Economic Risks
Movement since 2022
Increased
Likelihood
Possible
Impact
Moderate
Principal Risk
How are we mitigating this risk?
Change in principal risk since 2022
The market for supply chain finance is
large, as outlined in the Strategic Report
on pages 17–18. As such, any increases
to Supply@ME’s market share to
even a small degree, this could have
a positive impact on the business.
The business is currently focusing on
clients based in the UK and Europe,
Italy in particular. This narrowing of
focus should mitigate some of the
risk inherent from the increased
global conflict.
To mitigate the risk to the business of
immigration constraints caused by
Brexit the Company has obtained a
Visa Sponsorship Licence.
The risk in this area has increased in
the last year in our view largely due
to the macro-economic environment.
The increased uncertainty arising
from continued global conflict is
having an impact on overall business
confidence which is also being felt by
Supply@ME.
Although Supply@ME is not a lender
and does not provide financing the
decreased appetite of SME’s and
large enterprises for loans due to
higher interest rates could arguably
reduce the size of the potential
addressable market for Supply@ME.
The current global macro environment
has an effect on all businesses,
including the Group, its corporate
clients and inventory funders.
Consideration has been given to
changes in loan appetite which is
outlined in the Strategic Report on
pages 17–18.
The increased level of conflict
globally, in particular the war in
Ukraine and the increased tensions
in the Middle East, could potentially
affect the success of businesses who
would be client companies of
Supply@ME, leading to a smaller
potential market.
Consideration has also been given to
the impacts of Brexit. As our
business model requires legal
contracts complaint with laws in
individual countries the impact on
the operations of the business from
this macro event is limited. The
restrictions of free movement of
people and the immigration
requirements in the UK as a result of
Brexit is of greater concern.
52 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Inventory Funding Risk
Movement since 2022
Reduced
Likelihood
Possible
Impact
Major
Principal Risk
How are we mitigating this risk?
Change in principal risk since 2022
Key to the Supply@ME business model
is the interest of funders to acquire
inventory and invest in the new model
for which Supply@ME provides pre and
post monetisation services. If there is
no interest, or reduced interest by
funders to invest in this asset class of
inventory there is risk to the Supply@
ME business model.
The Group has seen positive
progress in this area during 2023
including, the first traditional funding
of inventory, the developments in the
securitisation of assets and the first
White-Label commitment. This
progress, together with the new
strategic partnership with SFE has
reduced this risk to the Group
through demonstrating there is
interest from a variety of market
players to fund inventory.
The new structure outlined in the
strategic report on pages 9–12
mitigates some of this risk.
Developing a strategic partnership
with SFE who will proactively manage
the funder relationships in any
Inventory Monetisation transaction is
a positive development in this area
as it should allow for a greater
understanding of the funders’
requirements.
Additionally, the diversification of
potential routes to market mitigates
this risk. These potential routes
include funding provided by White-
Label partners, traditional funding
and tokenisation as potential funding
routes for inventory.
Technological Advancements
Movement since 2022
Maintained at same level
Likelihood
Unlikely
Impact
Moderate
Principal Risk
How are we mitigating this risk?
Change in principal risk since 2022
Technology is advancing at a
phenomenal rate. The development
of and increased use of AI being one
of the recent most significant. The
increased digitisation of assets is also
a relevant advancement.
As a Fintech business it is essential
that our technology and the team’s
knowledge of new technology use
cases keeps pace with the external
environment so that any new
relevant technologies can be
included into the IM Platform as
efficiently and effectively as possible.
A growth mindset and innovation are
encouraged at Supply@ME across all
members of the team. This will help
the team and the Group to stay
abreast of new technology and its
use. One example of this is the whole
team starting to undertake the Route
Crypto Training during 2023.
There have been technology
advancements in the market during
2023, and while the Group’s focus on
innovation and learning has
continued in order to keep abreast
of these changes, this risk has
remained static compared to 2022.
This is in part due to the constant
changing technological landscape
but also due to the current limited
availability of financial resources that
the Group has to invest in this area.
53 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Principal Risks and Uncertainties
Commercial Legal Risk
Movement since 2022
Reduced
Likelihood
Unlikely
Impact
Minor
Principal Risk
How are we mitigating this risk?
Change in principal risk since 2022
When Supply@ME engages with a
new a corporate client the location of
their inventory is a key part of early
discussions and companies are
progressed through the Supply@ME
pipeline taking this into
consideration. External legal
expertise is sought for each country
region that the Group is engaging in
business to reduce any risk of breach
of local legislation and to ensure the
leadership team is made aware of
any specific legal circumstances that
might be unique to a particular
country or region.
A significant amount of time and
resources have been invested into
the development of standard
commercial contracts for the UK and
Italy, and these have been
implemented with client(s) in these
two regions.
Solid progress has also been made
on establishing legal structures in
France where corporate clients in the
Group’s pipeline have approached
Supply@ME with inventory they wish
to have monetised. Given this
progress over 2023, this risk has
reduced compared to the prior year.
The Supply@ME business model
requires new and detailed legal
contracts to be in place in each
global jurisdiction in which a
monetisation is to take place. This is
required in order to ensure the
contracts are tailored to specific
circumstances and regulations in
that new region. This creates a risk of
the Group potentially breaching
legislation specific to a new region. It
also means that the first
monetisation in a new region could
have significant up-front cost in both
time and finances depending on the
complexities of that region. However,
as the business expands to more
regions, this will then lead to a
scalable model which can be
replicated in a much more efficient
manner for each new client onboarded
in an already established region.
54 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Financial Risk
Financial risk takes into consideration risk resulting from the loss of capital. Consideration is given to liquidity, market and
credit risk.
Group Funding Risk
Movement since 2022
Increased
Likelihood
Likely
Impact
Major
Principal Risk
How are we mitigating this risk?
Change in principal risk since 2022
Funding was challenging during 2023
due to the delays in funding being
received. As such, this risk has
increased when compared to 2022.
There were unforeseen delays which
impacted on:
> Our people, which increased the
risk of attrition.
> Our third-party suppliers, which
increased the risk of the Company
being able to seek the external
expertise it required.
> Our ability to build the technology
infrastructure at a pace originally.
While the business progress has
been positive over 2023 and early
2024, this risk will remain high until
the Group is able to consistently
generate revenue which is sufficient
to cover its costs.
The Company and its Board are
continually reviewing the cash flow
position of the Group and, as
required, will explore additional
funding facilities available to meet
the cash flow, working capital and
growth needs of the Group. To
support this the Company remains
engaged with several key stakeholder
and finance providers to fulfil the
future funding needs and to provide
the Group options to diversify the
current sources of funding and
mitigate the risk of being dependent
on the various funding commitment
provided by TAG.
To help mitigate the impacts of the
delayed funding payments from TAG
during 2023 and to date in 2024, the
Board are in regular contact with
TAG and have been working closely
with them to ensure the committed
payments are continually being
received, albeit on a delayed basis.
Alongside this the Board are in
regular contact with the CFO to
ensure they are fully aligned on the
use to funds that are available.
The Company and the Group remain
in the early stage of development
and have not generated consistent
revenues from operations to date
and are not currently profitable. In
addition, predicting the time frames
within which the Group will
commence the generation of
consistent revenues remains difficult.
As a result of the current stage of
development, the Group has needed
to rely on funding from various
sources in the past including equity
placings, various shareholder funding
commitments together with other
loan and convertible loan note facilities.
Despite continued confidence in its
long-term strategic aims, the
Directors continue to recognise
additional financing will likely be
required and that the availability of
future potential funding options may
be limited and could potentially be
on terms that are not favourable to
the Group and may be dilutive to
shareholders.
Additionally, during 2023, and to date
in 2024, the Group has experienced
delays in terms of the funding
commitments that had been entered
into with its key shareholder, TAG.
This created a new risk to the Group
in terms of the relevant counterparty
being able to provide funding in line
with their contractual commitments
to the Group.
55 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Principal Risks and Uncertainties
Operational Risk
Operational risk is the risk of loss resulting from inadequate or failed internal processes, people and systems or from external events.
Business Continuity Risk
Movement since 2022
Decreased
Likelihood
Unlikely
Impact
Moderate
Principal Risk
How are we mitigating this risk?
Change in principal risk since 2022
Our business is evolving. As a
business evolves, processes need to
adapt and improve. Not keeping
abreast of these changes exposes
the Group to risk of not delivering for
our clients and/or business failure.
It is also key that our IM Platform is
accessible and available, which
requires any outage time being kept
to an absolute minimum. As such
processes and policies being in place
to allow for business continuity when
faced with technical issues is key to
the Groups success as a result any
failure or inaccessibility of our IM
platform is considered a principal risk
for the Group.
“Key Person” dependency is an
element of business continuity risk,
to mitigate this all policies, processes,
and procedures are clearly
documented, along with training
videos, and standardised templates
enabling any team member to be
able to carry out part of a process.
The team has consistently been
focused on process documentation
to create robust business continuity
plans and to build this into every
element across the Group. As a
result of the work completed in 2023
and early 2024, this risk has decreased
as compared to the prior year.
Business continuity plans are in place
and are presented to third parties
when necessary. They are also
reviewed and tested to ensure
robustness.
All our technological components are
backed by Service Level Agreements
and support plans, with scheduled
back-ups and restoration plans
should they fail.
All our processes are able to be run
manually should there be a
significant downtime of any of our
components.
When working with third party
suppliers we ensure agreements
encompass business continuity
measures / service level agreements
in order to mitigate the risk that the
IM Platform processes are impacted
by the business interruption of
services provided by key suppliers.
56 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Talent and Diversity Risk
Movement since 2022
Increased
Likelihood
Possible
Impact
Moderate
Principal Risk
How are we mitigating this risk?
Change in principal risk since 2022
Loss of certain member of the Board
and leadership team could lead to a
reduced ability to effectively run the
Group, while loss of the key
members of the team could hamper
the speed at which the Group is able
to scale up the business and
increase operational efficiency.
The cash flow challenges faced by
the Group during 2023, and early
2024, has had an impact on the
Supply@ME team and led to some
attrition. The risk of loss of key
members if the team has increased
during this period, including in the
leadership team. Given the current
focus on cost control, not all of these
vacancies have been filled and
instead work has been distributed to
the remaining team members. The
Board and Chief People Officer are
actively managing this risk.
The Board and leadership team
continue to work closely to mitigate this
risk by keeping lines of communication
open with the team. Additionally, during
2023 the regular succession planning
reviews were extended to cover all
levels of the team so that any key
vulnerabilities were clearly identified.
These reviews are conducted by the
Nomination Committee supported by
the Chief Executive Officer and Chief
People Officer.
Feedback was gathered from the
team in late 2023 through the annual
employee experience and
engagement survey. This insight has
assisted in putting in place measures
to continue to minimise risk of
attrition of key members of the team,
and to allow the Board to identify key
areas of importance across the team.
While the Group does not yet have
the resources available to it to
incentivise employees via the
payment of bonuses or payrises, the
Board continued to make awards
under the Long-Term Incentive Plan
during 2023.
57 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Principal Risks and Uncertainties
Cyber Security Risk
Movement since 2022
Maintained at same level
Likelihood
Unlikely
Impact
Major
Principal Risk
How are we mitigating this risk?
Change in principal risk since 2022
The proprietary fintech Platform
developed by the Group and used to
facilitate Inventory Monetisation
transactions is the intellectual
property of the Supply@ME Group.
Given the global rise in the number
of data and cybersecurity breaches
carried out by malicious actors or
hackers, the Group’s intellectual
property may be at risk of being
stolen as a result of unauthorised
access to its systems.
The Group is aware of growing
cybersecurity risks and regularly
reviews the robustness of
cybersecurity provisions around its
network. This includes mandatory staff
training to recognise data breach and/
or phishing attempts, via software
such as malware or ransomware.
The major technology components
of the IM Platform require Multi-
Factor Authentication as an added
level of security. All data is held in a
cloud environment that has threat
monitoring, detection, and alerts as
standard protocols.
The Group has put in place an
approved Data Breach Response
Policy.
Cyber security risk is perceived to be
one of the most important global
business risks in 2024 as outlined by
recent research by Allianz. Supply@
ME has also noted an increase in
phishing attempts. Despite the
increased macro risk, the mitigating
actions the Group has in place has
led to the conclusion that this risk
has remained unchanged when
compared to the prior year.
58 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Regulatory, Legal and Reputational Risk
Regulatory, Legal and Reputation Risk are defined as those relating to the legal and regulatory frameworks within which the
Company operates. Reputational risk is linked to this as all of these areas related to the engagement in activities that detract
from Group’s goal of being a trusted and reputable Company.
Corporate Legal and Regulatory Risk
Movement since 2022
Increased
Likelihood
Possible
Impact
Moderate
Principal Risk
How are we mitigating this risk?
Change in principal risk since 2022
The Group breaches a legal or
regulatory requirement which
impacts its ability to deliver for its
stakeholder.
Supply@ME is a small team, who are
supported by external experts to
help ensure the Group is compliant
with its various legal and regulatory
requirements. The Board has
oversight and has been thoughtfully
hired for their combined expertise to
challenge and support the business
in this area.
Enlisting the support of external
experts comes at a cost which has to
be balanced with its current financial
position. The risk in this area has
increased during 2023 as the spend
on advisors has been carefully
considered and reduced in line with
cash flow constraints.
Data Protection
Movement since 2022
Maintained at same level
Likelihood
Rare
Impact
Moderate
Principal Risk
How are we mitigating this risk?
Change in principal risk since 2022
Effective data protection is
fundamental to our business and a
data protection breach could
damage stakeholder relationships,
incur costs and damage reputation.
Operating in multiple jurisdictions
leaves a risk of breach of individual
jurisdictional legislation.
The Group has engaged extensively
with recognised data protection
experts to establish appropriate data
protection policies and procedures
in the jurisdictions within which it
currently operates.
During 2022 our processes and
procedures around data protection
were reviewed and refined. During
2023 this process has continued. The
risk in this area remains consistent
compared to the end of 2022.
59 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Principal Risks and Uncertainties
Reputational Risk
Movement since 2022
Increased
Likelihood
Possible
Impact
Moderate
Principal Risk
How are we mitigating this risk?
Change in principal risk since 2022
A positive reputation will assist a
business to become more
successful. Being a desirable
business partner to all types of
stakeholders will have a positive
impact on business performance.
The Groups reputation becoming
damaged will impact the speed at
which it can expand, grow and prove
its business model.
In the past Supply@ME sought
support from external public and
investor relations agencies to assist
in brand and communications
management. The Board and
leadership team have becoming
increasingly considered in the
communications made externally
following advice received from these
experts.
The budget for external public and
investor relations support has been
reduced during 2023 in line with
cash flow. The increased
consideration given by the team
prior to communicating externally
has had mixed responses from the
Groups wide retail shareholder base.
Additional investment in external
public and investor relations support
will be sought in line with the
resource and cash availability.
Environmental, Social and Governance Risk
The Supply@ME approach to ESG and its TCFD statement can be found on pages 46–49.
The Strategic Report set out from pages 3–60 is approved by the Board of Directors and signed on its behalf by:
Alessandro Zamboni
Chief Executive Officer
30 April 2024
60 Supply@ME Capital Plc Annual Report and Accounts 2023 Strategic Report
Corporate
Governance
Report
Corporate Governance Introduction
Our Board of Directors are focused on ensuring sound
corporate governance and an effective Board. The Board
jointly takes responsibility for overseeing the Company’s
corporate governance model and ensuring that effective
communication flows freely between Executives and
Non-Executives in a timely manner.
We have adopted the Quoted Companies Alliance Corporate
Governance Code (QCA Code). This report follows the structure
of these guidelines and explains how we have applied the
guidance. The Board is cognisant of the importance of
compliance with the QCA Code and endeavours to adhere
to this as far as practicable having regard to the size,
nature and current stage of development of the Company.
From April 2024 the Board will be using the updated QCA
guidelines, and will report against them in future years.
We understand 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 details of our Corporate
Governance can be found on our website.
Outlined in the next pages are details of the Directors of
the Group during 2023.
62 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
62 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Directors’ Information
Current Executive Director
Alessandro Zamboni
Chief Executive Officer and Executive Director
Appointed 23 March 2020
Alessandro is CEO and Executive Director of Supply@ME
Capital Plc. He specialises in the financial services industry
and related strategic and digital 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. He
founded the AvanteGarde Group S.p.A, the former parent
company of Supply@ME S.r.l., in 2014. He holds a BA
degree in Economics from the University of Turin.
As well as being CEO of Supply@ME Capital Plc, Alessandro
holds Executive positions at AZ Company S.r.l., AvantGarde
4.0 S.r.l., Orchestra Group (rete di imprese), The
AvantGarde Group S.p.A., RegTech Open Project S.p.A.,
Future of Fintech S.r.l. and 1AF2 Limited and Non-
Executive Director roles at Darwinsurance S.r.l. and
RegTech Open Project Plc.
63 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
63 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Directors’ Information
Previous Executive Directors
Thomas (Tom) James
Executive Director
Appointed 30 July 2021
Resigned 23 March 2023
Tom was an Executive Director from 30 July 2021 until 23
March 2023, and continues to be the CIO, CEO and
co-founder of TradeFlow, of which Supply@ME owns 19%.
He has over 30 years of commercial expertise in the
commodity and energy industry and is the business and
system architect for TradeFlow’s unique and innovative
digitised trade finance solution for bulk physical
commodity transactions. He has experience of senior
regulated roles in financial institutions (including Bank of
Tokyo Mitsubishi UFJ, Credit Agricole and Credit Lyonnais)
and various trading firms including BHP Billiton, covering a
full range of functional areas including trade finance,
project finance, investment banking, supply chain/
operations, derivatives, physical markets, and fund
management. During his career he has operated in many
countries in Africa, Europe, Middle East, and Asia Pacific.
In addition to his role on the Board of Supply@ME Plc
during 2023, Tom was also Director of TradeFlow Capital
Management Pte. Limited, TradeFlow Capital Management
Systems Pte. Limited, and the following dormant
companies, Tijara Pte. Limited, TradeFlow Capital Fund
Management Pte Ltd, TradeFlow Capital Management
Limited (UK), Navitas Resources (UK) Limited, Navitas
Resources Pte Limited and NR Capital Pte Limited which is
currently in liquidation.
John Collis
Executive Director
Appointed 30 July 2021
Resigned 23 March 2023
John was an Executive Director from 30 July 2021 until his
resignation from the Board on 23 March 2023. He is
co-founder of TradeFlow where he holds the position of
Chief Risk Officer (CRO). As well as overseeing the
development of the fund’s critical legal infrastructure and
working with leading counsel on its enforceability, John has
overseen the classification of the specialist intellectual
property developed and acquired by TradeFlow and its
licensing. John is a commercial lawyer with expertise in
regulatory, compliance, structuring, and transactional
matters. John operated his own law firm from 2003,
specialising in international commercial work. John has
written and lectured about the rule of law, Eurasia
Economic Union, CSTO, and International Commercial
Enforcement. Before becoming a lawyer, John worked for
Ernst & Young, he was educated at Oxford University and
is chairman of Hertford College RFC.
In addition to his role as a Director of Supply@ME during
2022, John was a director of TradeFlow Capital
Management Pte. Limited, TradeFlow Capital Fund
Management Pte Limited, TradeFlow Capital Management
Limited, Tijara Pte. Limited, TradeFlow Capital
Management Systems Pte. Limited, Kenwood Secretaries
Limited, Higher Education Research Limited, MTI Solutions
Limited, JCS 107 Limited, JCS 110 Limited, NR Capital Pte
Limited, Price Verifier System Limited, Softnpower Limited
and Ultraponix Limited.
64 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
64 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Current Non-Executive Directors
Albert Ganyushin
Independent Chairperson and Non-Executive Director
Appointed 30 June 2022
Alexandra Galligan
Independent Non-Executive Director
Appointed 16 March 2023
Albert was appointed as independent chairperson and a
Non-Executive Director in 2022 following a long career in
capital markets. Since 2017, he has served as Head of
Capital Markets at Dr. Peters Group with responsibility for
international institutional business, including investment
management, capital markets, financing and investor
relations. Prior to joining Dr. Peters Group, between 2010
and 2016, he worked in leadership roles in the listings
business of NYSE Euronext Group after a career in
investment banking that started with Deutsche Bank A.G.
(London Branch) in 2000. He graduated with an MBA
degree from London Business School in 2000 and began
his professional career as a management consultant with
Accenture in London in 1995.
In addition to his role with Supply@ME Albert is also a
director of Westcott Hill Capital Limited and Wotton Hill
Capital LLP and Non- Executive Chair of RegTech Open
Project Plc.
Alexandra holds more than 20 years’ experience in senior
business development positions, including most recently
as Partner and Chief Executive Officer at FCA-regulated
investment advisory firm MUSST Investments LLP (MUSST)
– a role she held for over a decade. During her time at
MUSST, Alexandra maintained and developed
relationships with a wide network of investors advising
them on investing in early-stage hedge funds, private
credit and alternative assets. Her previous roles also
included business development at financial services firm
Matrix Group Ltd, where she was appointed to create
in-house platform of hedge funds and UCITS vehicles. She
was also responsible for the structuring of these funds,
preparation of related prospectuses, subscription
documentation and marketing materials. She graduated
from the London School of Economics with an MSc in
Accounting and Finance following obtaining a BComm
from the University of Dublin.
Alexandra is also a Director of the charity A Leg to Stand
on UK.
65 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
65 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Directors’ Information
Current Non-Executive Directors
David Bull
Independent Non-Executive Director
Appointed 22 July 2021
Enrico Camerinelli
Independent Non-Executive Director
Appointed 23 March 2020
David, a Chartered Accountant, with 30 year’s experience,
is a technology-driven experienced financial services
professional with a banking and financial services
digitisation mindset. He has held a number of senior
Board roles within banking, asset finance, treasury and
credit management institutions, including several years as
Chief Financial Accountant at The Bank of England. He
holds a BSc (First Class) in Mathematics and Statistics from
the University of Bradford.
Enrico keeps abreast of market trends and business
practices by taking an active 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. He regularly
attends major industry events as invited guest speaker
and writes on specialised magazines and papers. He holds
an MSc in Electronic Engineering from Università degli
Studi La Sapienza, Rome, Italy. Enrico is also a Director of
Ermi di Enrico Camerinelli.
David is also an Executive Director of KDB Office Services Limited
and Thumb Soldiers Limited and Non-Executive Director of
Braintree Hockey Club Limited, and CRB Family Limited.
66 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
66 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Previous Non-Executive Director
Andrew Thomas
Independent Non-Executive Director
Appointed 30 June 2022
Resigned 15 March 2023
Andrew has over 20 years’ experience in various business
advisory roles and during this time has worked across the
US, UK, EU and APAC regions, acquiring expertise of
onshore and offshore fund structuring and oversight,
particularly in relation to regulatory issues. He also has
extensive experience in mitigating ESG risks while helping
organisations to maximise ESG opportunities. He holds BA
in History and Politics from the University of Exeter. In
addition to his role with Supply@ME he was also a director
of Transatlantic Regulatory Consulting LLC.
67 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
67 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Directors’ Information
Overview
During the course of 2023 there have been a number of
changes to the Board structure and composition. The Group
started the year with Albert Ganyushin as Chairman and
Enrico Camerinelli, David Bull and Andrew Thomas as Non-
Executive Directors and Alessandro Zamboni, John Collis and
Tom James as Executive Directors.
On 15 March 2023 Andrew Thomas stepped down as
Non-Executive Director and was replaced by Alexandra
Galligan who also undertook the role of Remuneration
Committee Chair from this date. Following this, on 23
March 2023 John Collis and Tom James resigned from the
Board whilst maintaining their roles at TradeFlow. Further
information regarding Board changes during the year can be
found in the Nomination Committee Report on pages 75–77.
The Board generally plans to meet once a month, however,
additional Board meetings were held during FY2023 which
reflect the pivotal activities undertaken during the year.
Details of the Board’s principal activities and decisions
throughout the year are set out in more detail below.
These included, but were not limited to, the first Inventory
Monetisation transactions using traditional funding sources,
securing a second subscription of longer term equity funding
from Venus Capital which was agreed in April 2023, the
TradeFlow Restructuring, the signing of the term sheet for
the first White-Label transaction with BBPM in early January
2024, the agreement of additional financing facilities with
TAG followed by the implications of the underperformance
by TAG against its committed financing facilities, discussion
of various possible mitigating actions to be investigated as a
result of the late payment by TAG and the issuing of the new
supplementary prospectuses on 4 May 2023 and 30 June
2023 following the announcement of the FY2022 Annual
Report and Accounts, and the completion of the TradeFlow
Restructuring, respectively.
During 2023 30 Board meetings were held including both
scheduled and ad-hoc meetings Additionally there were 2
sub-committee meetings, 17 formal written resolutions and
a Board Strategy Day which was held in March 2023 and
focused on developing longer term strategic goals for the
business and the senior leadership team. In addition, the
Company held its Annual General Meeting and a specific
General Meeting to approve the extension to the expiry date of
the open offer warrants which were previously issued to retail
shareholders during 2022. Both the Annual General Meeting
and the General Meeting were held on 23rd June 2023.
Sub-committees are convened by the Board to manage specific
work streams in a timely and efficient manner, and keep the
Board appraised of progress. The sub-committee meetings
were focused on final approval of documentation related to
the annual report, interims, prospectus and related documents
post discussion at a full Board meeting. Written resolutions
require consideration and signatures from all members of
the Board and were largely concerned with issuing shares as
a result of open offer warrants being exercised.
2023 Board attendance
Director
Schedule / Attended
Appointed to Board
Resigned (if applicable)
Albert Ganyushin
Alexandra Galligan
Alessandro Zamboni
David Bull
Enrico Camerinelli
John Collis
Tom James
Andrew Thomas
30 / 30
28 / 28
27 / 30
30 / 30
28 / 30
2 / 3
2 / 3
2 / 2
30 June 2022
16 March 2023
23 March 2020
22 July 2021
23 March 2020
30 July 2021
30 July 2021
N / A
N / A
N / A
N / A
N / A
23 March 2023
23 March 2023
30 June 2022
15 March 2023
68 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Independence
Consideration has been given by the Board to the QCA Code
in relation to independence and a balanced Board. Principle
5 of the QCA Code, is to maintain the Board as a well-
functioning balanced team led by the Chair. The guidance
to this principle states that there should be an appropriate
balance between Executive and Non-Executive Directors
and that there should be at least two independent Non-
Executive Directors. This requirement has been met by the
SYME Board throughout 2023.
All current Non-Executive Directors are considered independent
by the Board. In addition, former Director Andrew Thomas was
considered Independent during his tenure.
Principal Board Activities and Decisions in 2023
The principal decisions made, and activities carried out, by
the Board during 2023 are summarised below:
Ongoing regular governance activities
> During the pre-scheduled monthly Board meetings,
regular agenda items included updates from the Chief
Executive Officer, Chief Financial Officer, Group Head
of Enterprise Risk Management and Chief People
Officer. Updates were also provided from each of
the Remuneration, Nomination, Audit and Disclosure
Committees, following these respective Committee
meetings, and where necessary, input and approval was
sought from the Board on key topics in lines with the
terms of reference. This included, but was not limited to,
review of:
> related party transaction and potential conflicts of
interest;
> committee terms of reference;
> business continuity;
> discussion, review and approval of budgets and cash
flow forecasts;
> approval of regulatory news announcements including
those relating to the interim financial statements,
annual reports and accounts, prospectuses, issue of
new ordinary shares, ad-hoc business updates etc;
and
> risk management framework, with a focus on the
principal risks and uncertainties.
> Discussion and approval of Board changes, including
members stepping down, and appointment of Alexandra
Galligan;
> Discussion and consideration of any investor relations
communications;
> Approval of the new Long Term Incentive Plan and granting
of share options to certain employees on 19 May 2023; and
> Exercise of warrants in relation to the open offer.
Significant business milestones
During the course of 2023 a number of significant business
milestones have been reached which have required the
Board’s focus, outlined but not limited to the below.
Operational milestones:
> The potential opportunities displayed by the new ltalian
legislation pegno non possessorio (the “PNP Regulation”)
for Italian banks to adopt the Supply@ME Platform for
use under potential White-Label agreements and to
further enhance the security available to the inventory
funders in traditional IM transactions.
> The completion of the first Inventory Monetisation
transaction in Italy of warehoused goods of an Italian
client company utilising traditional funding sources. The
client being one of the market leaders in the tyre re-
treading sector with operations around the world.
> The completion of the TradeFlow Restructuring on
30 June 2023 with the aim of better serving both the
needs of client companies and the funders of both
businesses and eliminating any perception of conflicts
of interest between the two businesses whilst providing
both businesses with greater commercial opportunities
through the clear differentiation of responsibilities of the
individual entities.
> Securing of a binding commitment provided by an
institutional investor to provide committed funding for the
first IM in the UK, the client being a UK client company,
which provides parts and technology to the global marine
industry the execution of this transaction was delayed
due to several external barriers’ (outside of SYME control)
such an existing floating charge facility which has required
the client company to gain specific waivers, amongst
other things
> Collaboration with a group of private investors and
subject matter experts of working capital solutions to
launch an independent Swiss-based trading business to
replace the Cayman-based global inventory fund (“GIF”),
previously advised by TradeFlow. The CH Trading Hub,
owned by SFE, is also expected to acquire control of the
independent stock companies from the GIF, to manage
the overall trading businesses using the Platform and the
associated services provided by the Group.
> Working toward the commencement of the Group’s
overall White-Label go-to-market strategy resulting in
the announcement on 3 January 2024 of the binding
commitment provided by Banco BPM S.p.A. to fund
an initial IM transaction with an inventory value to be
monetised up to €10 million of an existing client of BBPM.
69 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Directors’ Information
Governance Milestones:
> Transition from the London Stock Exchange’s SETSqx
(Stock Exchange Electronic Trading Service: Quotes and
Crosses) trading platform to its SETS (Stock Exchange
Trading System) trading platform.
> Preparation and publication of new supplementary
prospectuses published on 4 May 2023 and 30 June
2023, following the announcement of the FY2022
Annual Report and Accounts, and the completion of the
TradeFlow Restructuring, respectively.
Financial Milestones:
> Execution of the new equity funding that was announced on
28 April 2023 with Venus Capital in order to continue to provide
more stable and longer term investment into the Group.
> The completion of the various funding facilities with The
AvantGarde Group S.p.A. (“TAG”) including:
> The unsecured fixed term working capital loan
agreement which was signed by TAG and the Company
on 28 April 2023 with the aim of TAG providing up to
£2,800,000 of working capital funding to the Company.
This agreement was subsequently amended on the 30
June 2023 and the amount of to be provided by TAG
under this agreement was reduced to £800,000.
> The debt novation deed that was agreed between
TAG, the Company and the buyers of the 81% stake
in TradeFlow. This debt novation deed was signed
in connection with the TradeFlow Restructuring on
30 June 2023 and created the obligation for TAG to
settled the £2,000,000 cash payment due from the
buyers of the 81% stake in TradeFlow to the Company.
> The top-up unsecured shareholder loan agreement
agreed on 28 September 2023 with TAG to provide
the Company with a further facility of up to £3,500,000
to cover the Company’s working capital and growth
needs up to 30 June 2025.
> Given each of these agreements represented a material
related party (as such term is defined by IFRS) transaction
for the purpose of the DTR 7.3, these were each carefully
considered by the independent directors to ensure
they were concluded to be fair and reasonable from the
perspective of the Company and its shareholders who
were not the related party.
> Towards the end of 2023, the Board’s activities were
focused on the monitoring of the Group’s cash flow
position as a result of delays in receipt of the funding
from TAG under the various funding facilities referred
to above. The Board met regularly and has been closely
monitoring the impact on the Group as well as discussing
with TAG what actions they are undertaking to ensure
they are able to meet their contractual obligations to
Supply@ME albeit on a delayed basis. The Board has also
been analysing and exploring alternative funding options
presented considering the issues caused by the late
payments referred to above.
70 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Statement of Compliance with the QCA Corporate
Governance Code
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.
Details of how the Board has engaged with our wider
stakeholder group, including our people, shareholders,
corporate clients, inventory funders and fund investors can
be found in our section 172 Statement.
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 Group’s risk position
is considered by the Board on a regular basis, with ad-hoc
reviews conducted as required. The Board is responsible for
establishing and maintaining the Group’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 Group 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 cash flow forecasts, regular monitoring
of actual spend compared to cash flow forecasts (including
investigation of significant variances), control of capital
expenditure, ensuring proper accounting records are
maintained and high-quality financial statements are
produced as required. The Directors will continue to reassess
internal financial controls as the Group 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.
The Group’s auditors are encouraged to raise comments
on internal control in their management letter following
their audit, and the points raised and actions arising are
monitored through to completion by the Audit Committee.
Principle 1.
Establish a strategy and business model which promote long-
term value for shareholders.
The Board and leadership team continue to focus on the
long-term growth of the business and building a solid
foundation which underpin the reasons shareholders
should invest. Supply@ME has developed a novel and
unique solution which has and continues to take time
and investment. There is a clear gap in the market which
represents a huge opportunity for the organisation to scale
and grow, whilst creating long-term value for shareholders.
The solid foundations have been built and the unique
solution is proven and multimarket ready.
Principle 2.
Seek to understand and meet shareholder needs and
expectations.
The Group continually seeks to improve its engagement with
its shareholders, both private and institutional investors.
During 2023 Supply@ME has continued to focus on
disseminating information to the market in a timely manner,
as well as monitoring and responding to communications in
the dedicated investor relations inbox, where it is possible
to respond, for shareholders to be furnished with non-
market sensitive information. As a growing business, with
limited bandwidth, it is not possible for our team to provide
an individualised response to each and every enquiry we
receive. However, every communication is reviewed and,
where possible, furnished with a full response as a priority.
This process will continue to evolve with the business.
In May 2023 the Company invited investors to an online
presentation to outline the opportunities for the business
and demonstrate how the Supply@ME business model fulfills
these opportunities and the Company’s relative position in
the competitive landscape in more detail. Additionally, in
June 2023, the Company held its AGM and addressed the
significant number of questions raised by its shareholders,
both in person and via the Investor Meet platform. The AGM
was available for shareholders to join online as well as in
person, giving all shareholders the opportunity to join if they
wished to. Finally, during 2023 Supply@ME has provided
commentary on topics relevant for global supply chains
through a series of blogs published on LinkedIn.
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. Proactively engaging with our
stakeholders strengthens our relationships and helps
71 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Statement of Compliance with the QCA Corporate
Governance Code
Principle 5.
Principle 6.
Maintaining the Board as a well- functioning, balanced team
led by the Chair.
As referenced in the Directors’ Information section and
the Report of the Nomination Committee included in
this Annual Report, there have been a number of Board
membership changes during 2023. The Board currently
consists of one Executive Director, Alessandro Zamboni,
CEO and four independent Non-Executive Directors. Albert
Ganyushin leads the Board as independent Non-Executive
Chair supported by David Bull, Enrico Camerinelli and
Alexandra Galligan as independent Non-Executive Directors.
The balance of the Executive and Non-Executives and the
structure of the Committees is in compliance with the QCA
code. The biographical details of the Board members can
be found in this Annual Report on pages 63–67, as well as
on the Company’s Website. The Board changes during early
2023 outlined in the Nomination Committee Report are
testament to the fact the structure, size and composition
of the Board is regularly reviewed to ensure the Board
operates effectively.
The Board typically meets monthly in order to, amongst
other things, receive commercial updates from the CEO
and updates from other members of the Leadership team
on their respective functional areas as appropriate. At the
relevant time of the annual financial reporting cycle, these
monthly meetings are also use to cover the approval of
financial statements and significant changes in accounting
practices. During 2023 there have been a significantly higher
number of Board meetings to ensure the required focus and
scrutiny on particular areas including funding, commercial
progress of the business, and other strategic milestones.
The Directors commit the requisite amount of time to their
respective roles to ensure that they fulfil 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, a Nomination
Committee and a Disclosure Committee. Further details
of the Nomination, Remuneration and Audit Committee
can be found in each of the Committee Reports within this
Annual Report on pages 75–77, 85–107, 78–84, as well as
on the Company’s website. One element of the role of the
Independent Non-Executive Directors 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.
Ensure that between them the Directors have the necessary
up-to-date experience, skills and capabilities.
During the recruitment process for new Non-Executive
Board members, the Nomination Committee gives, a great
deal of consideration to the knowledge, skills and experience
required for the future of Group. Ensuring a balance of
broad Corporate Governance knowledge with specific skills
sets including Regulations, Trade Finance, Capital Markets,
FinTech Sector knowledge and Investor Relations and
Business Development experience has been crucial. In
addition to the appropriate balance of personal qualities and
capabilities for our innovative global business.
In order to develop their skills and keep up to date with
market developments and corporate governance matters,
new joiners to the Board are provided with a comprehensive
induction into the business. The Board also has regular
updates from and access to the leadership team. All
directors are 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’ Report 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. A formal Board evaluation was conducted in
December 2023 and reported on to the Chair. This evaluation
looked at the process that underpins Board effectiveness,
Board and Committee constitution and commitment, Board
dynamics and culture, stakeholder oversight and strategy.
This evaluation will be conducted annually with feedback
shared and appropriate actions taken.
Board and Leadership Team Succession planning is a matter
considered by the Nomination Committee. During 2023 the
risk and the impact of key members of the team taking the
decision to leave the Group was assessed. How these risks
could be mitigated was considered and appropriate action
plans put in place to reduce the level of residual risk where
possible. This evaluation will take place at least annually.
72 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
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 maximise shareholder value. The CEO and the
Leadership team seeks to engender open and positive
interactions with a focus on innovation, collaboration,
delivery and a global mindset. This culture is encouraged
throughout the business, with people management
practices aligned to support. Supply@ME is operating in
a new business area and the ability to innovate will be
essential to the Group’s success. Collaboration and ensuring
each member of the team’s views and opinions are heard
will lead to a better product and outcome for all the Group’s
stakeholders. Understanding the global perspective of each
decision and having an understanding of global nuances will
lead to a greater long-term reach of the Group. Most of all,
the Group wants to deliver for all its stakeholders and this is
central to the culture which is being created. The Company’s
policies set out its zero-tolerance approach towards any
form of modern slavery, discrimination, harassment, bullying
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.
The Board endeavours to ensure governance structures
within the Company are appropriate for the size, complexity
and risk profile of the Company. This is regularly reviewed
by the Board to ensure governance arrangements continue
to be appropriate as the Company changes over time. The
Board also responds to business opportunities and adjusts
its composition to take advantage of this, hence the changes
seen during early 2023.
The Board typically meet monthly to set the overall direction
and strategy for the Group and to review operational and
financial performance. The Board and its Committees
receive appropriate and timely information prior to each
meeting: and a formal agenda is produced for each meeting,
and Board and Committee papers are distributed 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 signed by the
meeting Chair and 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 Board and leadership
team, supported by external company secretaries and
lawyers, ensure 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 cash flow forecasts and reviewing performance
relative to those forecasts
> Approving financial statements
> Approving material agreements and non-recurring projects
> Approving senior and Board appointments
> Additionally, there is a delegated authority matrix
mandating those items requiring approval by Board.
Each member of the Board has clearly defined roles and
responsibilities. The Chair is responsible for the leadership of
the Board, ensuring its effectiveness and high standards of
corporate governance, approving and monitoring strategic
direction, and allowing stakeholder views to be incorporated
as part of the Board’s decision making. The Chair’s role is
also to build collaborative relationships, and promote debate
and openness so as to ensure the effective contribution
by all Directors and Non-Executive Directors. The CEO is
responsible for the day-to-day operation and running of
the Group, supported by the Leadership team. The CEO
also leads the development and implementation of the
approved strategy and business plan, ensuring decisions of
the Board are implemented, effective working relationships
with the Chair and Non-Executive Directors are maintained,
whilst providing leadership in the Company’s commitment
to its purpose, high business standards, culture and core
values, and communication with key stakeholders. The
Non-Executive Director role is to bring external perspective,
constructive challenge, independent judgement and
objectivity to the Board’s decision making and discussion.
They act as a sounding Board for the Chairman and a source
of reciprocal feedback for other members of the Board
and shareholders. The Non-Executive Directors bring a
range of skills, expertise and knowledge to the Board, and
constructively challenge the Executive management of the
Company. The Non-Executive Directors are responsible for
a range of activities, including monitoring the performance
of the Executive management, determining appropriate
levels of remuneration, ensuring financial controls and risk
management systems are robust, as well as challenging
and supporting the CEO and Leadership team in the
development of the strategy and objectives of the Company.
An Executive Director is an employee of the Group who sits
on the Board of directors but also performs management
duties within the business of the Company. Currently
73 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Statement of Compliance with the QCA Corporate
Governance Code
the only Executive Director on the Board is the CEO. The
Board is supported by an Audit Committee, Remuneration
Committee, Nomination Committee and Disclosure
Committee. Further details of the responsibilities of each of
these are outlined in their respective reports.
Detail of the corporate governance frameworks provided
by the Audit Committee, Remuneration Committee and
Nomination Committee can be found in their respective
reports and their terms of reference and those of the
Disclosure Committee are available on the Company’s website.
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.
74 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Report of the Nomination Committee
Dear Shareholders,
On behalf of the Board, I am pleased to present the
Nomination Committee Report for the year ending 31
December 2023. During the year, there were a number
of changes to the membership of the Board including
changes to Executive Directorships resulting from the
TradeFlow Restucturing, alongside changes to Non-Executive
Directorships due to our continued focus on ensuring we
have the right composition to lead and govern our unique
business to its full potential.
The resignations of Tom James and John Collis as Executive
Directors on 23 March 2023 was a precursor to the
completion of the TradeFlow Restructuring on 30 June 2023.
The disposal of SYME’s majority stake in TradeFlow was an
important step required to remove any potential future
regulatory or commercial conflicts of interest between the
two businesses. This in turn will better serve the needs of
our client companies and the funders of both business and
will improve the future growth prospects of both businesses.
The benefits of this change can be seen in the progress
being shared in this report with respect to the establishment
of the CH Trading Hub, owned by SFE.
In addition, Andrew Thomas resigned from his post as
Non-Executive Directors on 15 March 2023 to pursue other
business opportunities. I would like to thank Tom, John and
Andrew for their valuable contributions to the Board and
business during their tenure as directors.
We were extremely pleased that Alexandra Galligan joined
the Board on 16 March 2023 and became Chair of the
Remuneration Committee from this date, where she is
focused on ensuring the team are rewarded appropriately
and in line with shareholders’ expectations. Alexandra adds
a wealth of valuable knowledge and experience of Hedge
Funds, Investments and Business Development to the
Board alongside her valuable experience and knowledge of
investor motivation and their increasing focus on investing
in companies with demonstrable Environmental, Social and
Governance (“ESG”) credentials. On joining Alexandra also
became a member of the Nomination and Audit Committees.
Albert Ganyushin
Chair of the Committee and Board
30 April 2024
75 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Report of the Nomination Committee
2023 Committee Members and Attendance
Director
Scheduled meetings attended
Albert Ganyushin
Alexandra Galligan
David Bull
Enrico Camerinelli
Andrew Thomas
5 / 5
2 / 2
5 / 5
5 / 5
3 / 3
Appointed to Committee
if during 2023 or 2024
N / A
16 March 2023
N / A
N / A
N / A
Resigned \(if applicable)
N / A
N / A
N / A
N / A
15 March 2023
As at 31 December 2023 the Nomination Committee was
comprised of Alexandra Galligan, David Bull and Enrico
Camerinelli as members and Albert Ganyushin as Chair
(full biographical details can be found on pages 63–67). The
Committee must have at least two members, with a majority
being independent Non-Executive Directors. There must be a
majority of independent Non-Executive Directors appointed to
the Committee. After each meeting the Chair of the Committee
reports to the Board on the Committee’s proceedings in
respect of all matters within its duties and responsibilities.
Meetings are held at least twice a year at appropriate
times and otherwise as required. The Committee met
five times during 2023 with meetings being held by video
conference. In addition to the Committee members other
regular attendees included the Chief Executive Officer, Chief
Financial Officer and Chief People Officer.
Roles and Responsibilities
The role of the Nomination Committee is set out in its
terms of reference, which were updated in March 2024 and
are available on the Company’s website. The Nomination
Committee is responsible for the following key activities:
> Identify and evaluate suitable candidates to fill Board
vacancies when they arise and nominate candidates
for the approval of the Board. In identifying suitable
candidates, the Committee shall:
> Evaluate the balance of skills, knowledge,
> Before the appointment of a Director (including the Chair of
the Board), require the proposed appointee to disclose any
other significant commitments, including the time involved;
> For the appointment of a Chair of the Board, prepare a job
specification, including the time commitment expected.
The proposed Chair’s other significant commitments
should be disclosed to the Board before appointment
and any changes to the Chair’s commitments should be
reported to the Board as they arise;
> Keep under review the number of external appointments
held by each Director. A Director of the Company should
not undertake any additional external appointments or
other significant appointments without the prior approval
of the Board;
> Perform a formal and rigorous annual review of the
structure, size and composition of the Board, its
Committees, its Chair and individual Directors (including
the skills, independence, knowledge, experience, and
diversity required to discharge duties) and recommend
any changes, to ensure that an effective succession plan
is in place;
> Undertake, with the support of the Chief Executive
Officer, a talent management and succession planning
review of the senior management of the Company at
least once each financial year;
> Keep under review the Company’s leadership needs, both
Executive and Non-Executive, to ensure its continued
ability to compete in the market place;
> Review annually the time required from the Non-
independence, experience and diversity on the Board
and prepare a description of the role and capabilities
required for a particular appointment in light of this
evaluation;
Executive Directors and assess through performance
evaluation whether they are spending sufficient time to
fulfil their duties;
> Arrange for a Non-Executive Director, on appointment,
> Use open advertising or an external search consultant
for the appointment of the Chair and Non-Executive
Directors of the Board;
> Consider candidates based on merit and against
to receive a formal letter of appointment to the
Board, setting out what is expected in terms of time
commitment, Committee service and any involvement
outside Board meetings;
objective criteria, and within this context, promote
diversity of gender, social and ethnic backgrounds,
cognitive and personal strengths.
76 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
> Set policy for the granting of service agreements and their
termination;
> Ensure that all Directors undergo an appropriate
induction programme to ensure they are fully informed
about their duties and responsibilities as a director, and
to consider any training requirements for the Board as a
whole. Individual training will be discussed and facilitated
by the Company Secretary;
> Before the appointment of a Director (including the Chair
of the Board), require the proposed appointee to disclose
any other business interests that may result in a conflict
of interest and to report any future business interests
that could result in a conflict of interest;
> Review, on an annual basis, declarations by Directors of
situational and transactional conflicts / potential conflicts
of interest, ensuring that the influence of third parties
does not compromise independent judgement;
> Ensure that the Committee’s terms of reference are made
available to shareholders on the Company’s website and,
if requested, in hard copy.
Committee Activity during 2023
The Nomination Committee’s meetings have focused on a
number of matters, including those set out below:
> New Non-Executive Director attraction, assessment,
appointment and induction
> Review of independence of Directors
> Board and Board Committee evaluation including review
and assessment of Board composition, balance and
competence
> Review of membership and composition of Board
Committees
> Review and assessment of elements of Board members
Succession planning for both the Board and senior
leadership team has been a topic discussed at the
Nomination Committee, whereby thought and consideration
have been given to the team; how the business mitigates any
impact of departures and to develop long term strategies
around the attraction and retention of talent throughout
the organisation. The Nomination Committee has worked
closely with the Remuneration Committee to mitigate
these risks with the Long-Term Incentive Plan being a key
element of this strategy. The Committee and the Board want
the team and shareholders’ interests to be firmly aligned
over the long-term and this form of delayed performance-
based remuneration supports our retention strategy. The
second awards took place in May 2023 and details of the
proposal for a 2024 award can be found in the Directors
Remuneration Report on pages 85–107.
The Board views diversity on the Board itself and within
Supply@ME Group’s leadership team as essential for the
future success of the organisation. One measure of diversity
is gender balance. The gender balance of the Board of
20% female is not reflective of the gender balance in the
Company. The Supply@ME leadership team immediately
below Board level is 50% female, our employee base is 41%
female. Further details of the diversity within Supply@ME
can be found on page 31 where it is also outlined that the
Board does not yet meet the Board ethnicity targets. The
organisation is focused on hiring leaders and employees
from diverse backgrounds and will continue this focus during
2024 and beyond.
At the 2024 AGM Supply@ME will request the
reappointment of Enrico Camerinelli.
contracts
Board and Committee Evaluation
> Review of directors situational and transactional potential
conflicts
> Board and leadership team succession planning
> Assessment and approval of Directors other
appointments
> Review and updating terms of reference
> Review of time commitment from Non-Executive
Directors
> Diversity policy review
> Board training review
A thorough Board and Committee performance evaluation
was conducted in December 2023, to assess the following
areas:
> Processes that underpin Board effectiveness
> Board and Committee constitution and commitment
> Board dynamics
> Culture, stakeholder oversight and strategy
Focus for 2024
Board Changes and Succession Planning
There have been a number of changes to the Board during
2023, which were focused on ensuring we have the right
structure and composition to lead and govern this unique
business to its full potential.
The Nomination Committee will continue to build on
the work to date to future-proof Board-level and team
capabilities to enable Supply@ME to excel in the future.
While completing this work, there will be a continued and
renewed focus on diversity and ensuring Supply@ME is
positioned well to attract and retain the best talent.
77 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Report of the Audit Committee
> Challenging and reviewing the new funding arrangements
entered into during the year with TAG, particularly given
the related party element to these arrangements and
the importance of them on the Company and Group’s
ability to continue as a going concern. These funding
arrangements with TAG included the unsecured working
capital facility which was announced on 28 April 2022 and
then subsequently amended on 30 June 2023, and the
unsecured top up shareholder loan that was announced
on 29 September 2023.
Alongside the important activities listed above, the Audit
Committee has continued to focus on maintaining the
integrity and transparency of the Group’s external reporting,
has given careful consideration to the risk management
framework, has ensured compliance with relevant regulation,
and has provided challenge and guidance in respect of the
Group’s cash flow position in light of the delays that have
continued to be experienced in terms of the generation
of revenue from the facilitation of multiple Inventory
Monetisation transactions per year and in receipt of funds
due from contractual funding commitments.
Despite the limited resources within the finance team,
progress has continued in respect of strengthening internal
controls around monthly reporting, cash flow forecasting
and the application of complex accounting issues. To
date the progress against the longer-term goals of the
finance team has been slower than anticipated due to the
prioritising on the Groups limited resources to other areas of
the business and the support the finance team is providing
across a number of other areas of the Group as a result of
initiatives to cut costs where possible.
The Board and Nomination Committee have continued
to ensure that the Audit Committee has the right mix of
relevant financial and FinTech experience to support the
Groups anticipated future growth and as a result appointed
Alexandra as a member of the Audit Committee in March
2023, when she was also appointed to the Board.
David Bull
Chair, Audit Committee
30 April 2024
Dear Shareholders,
On behalf of the Board, I am pleased to present the Audit
Committee Report for the year ended 31 December 2023.
This report sets out the areas of key focus for the Audit
Committee during this period.
The Audit Committees core activities are linked to the
Group’s financial reporting cycle and cover the areas
delegated to it by the Board in connection with the
preparation and publication of the interim and annual
financial statements and oversight of the external audit
process. In respect of the financial statements for the Group
and Company for the year ended 31 December 2023,
the Audit Committee continued to review and challenge
the assumptions and judgements made by management,
particularly in connection with, the accounting for the
fundraising and financing activities undertaken by the
Company during 2023, the continued application of the
revenue recognition policies applied by the Group in
accounting for the initial Inventory Monetisation transactions,
the application of IFRS 5 (“Non-current Assets Held for Sale
and Discontinued Operations”) to the TradeFlow business
prior to the completion of the disposal of the 81% stake
held by the Company in TradeFlow on 30 June 2023 (the
“TradeFlow Restructuring”), the accounting for the TradeFlow
Restructuring in the financial statements of both the Group
and the Company, and the ability of the Company and the
Group to continue operating as a going concern.
During 2023 the Board also requested Audit Committee
involvement and support with the following specific activities:
> Providing oversight in connection with the supplementary
prospectuses that were required to be issued following
the publication of the 2022 Annual Report and
Accounts on 4 May 2023, and in connection with the
TradeFlow Restructuring on 30 June 2023 (the “Second
Supplementary Prospectus”). In particular, the Audit
Committee provided challenge and review over the
financial elements of the prospectuses, including the
proforma financial information that was required to be
included in the Second Supplementary Prospectus and
the ongoing monitoring of the validity of the working
capital statement included in the initial prospectus dated
3 October 2022.
> Challenging and reviewing the key parameters included
in the formal agreements signed on 30 June 2023 in
connection with the Trade Restructuring, which included
the novation of the remaining £2,000,000 consideration
due from the buyers of TradeFlow to TAG, which is a
related party.
78 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Audit Committee Members and Attendance
internal financial controls and internal control systems.
The table below sets out the members of the Audit
Committee (the “Audit Committee”) during the year (full
biographical details can be found on pages 63–67). The
current Audit Committee members are all Independent Non-
Executive Directors.
Director
Scheduled
Meetings
attended
Appointed to
Audit Committee
Resigned
(if appliable)
David Bull – Chair
5 / 5
22 July 2021
N/a
Enrico Camerinelli 4 / 5
23 March 2022 N/a
Albert Ganyushin
5 /5
30 June 2022
N/a
> Advising the Board on the Company’s risk strategy,
risk policies and current and emerging risk exposures,
including the oversight of the Group’s risk management
framework and systems.
> Assessing the adequacy and security of the Company’s
arrangements for its employees and contractors to raise
concerns, in confidence, about possible wrong-doing
in financial reporting or other matters and to ensure
proportionate and independent investigation of such
matters.
> Making recommendations to the Board as it deems
appropriate on any area within its remit where action or
improvement is required.
Alexandra Galligan 5 /5
16 March 2023 N/a
Meetings
Role of the Audit Committee
The role of the Audit Committee is set out in its terms
of reference, which were most recently reviewed and
approved in January 2024. These are available on the
Company’s website. The Audit Committee’s primary purpose
is to assume the delegated authority from the Board
for the responsibility of overseeing financial reporting,
the review and assessment of internal control and risk
management, compliance, and maintaining an appropriate
relationship with the external auditor. In order to fulfil these
responsibilities, the terms of reference provide a framework
for the Audit Committee’s duties including the following:
> Overseeing the relationship with the Company’s external
auditor, monitoring its effectiveness and independence
and making recommendations to the Board in respect
of its remuneration, appointment and removal. The
Audit Committee also meets regularly with the external
auditor and reviews the findings from the external
auditor, including discussion of significant accounting and
audit judgements, levels of errors identified and overall
effectiveness of the audit process.
> Review and report to the Board on the financial
statements of the Company and the Group, including
its annual and interim reports and, if applicable, any
other formal announcements containing information
on financial performance. The Audit Committee will
also consider and report to the Board on significant
financial reporting issues, accounting policies and key
areas of judgement or estimation. This review also
includes consideration of the clarity and completeness of
disclosures on the information presented in the financial
statements.
> Overseeing the accounting principles, policies and
practices adopted by the Company.
> Monitoring the need for an internal audit function in the
context of the Group’s overall risk management system.
> Reviewing the effectiveness of the Company’s system of
The Audit Committee has met on five occasions during the
year and three occasions since the year-end. In line with the
Group’s decision to focus on using technology as a means
of communication to limit business travel, all meetings were
held by video-conference.
The Audit Committee operates to an agenda linked to the
financial calendar which ensures that the responsibilities and
duties of the Audit Committee are discharged in accordance
with the Terms of Reference and the requirements of the
QCA Corporate Governance Code.
In addition to the Audit Committee members, by invitation,
the meetings of the Audit Committee may be attended by
the Chief Executive Officer, the Chief Financial Officer (“CFO”)
and other members of the leadership or finance team as
appropriate. The Company’s external auditor and accounting
advisors are invited to attend relevant Audit Committee
meetings, to ensure full communication of matters as they
relate to their respective responsibilities. During the year, the
Audit Committee members have the opportunity to meet
with the external auditor for a private discussion, without
management being present, regarding the audit process and
the relationship with management.
The Chair of the Audit Committee holds regular meetings
with the external auditor and also with the CFO.
Meetings of the Audit Committee are scheduled close to the
end of the interim period and full year, as well as before the
publication of the associated half-year and full-year financial
reports, so as to ensure the Audit Committee is informed
fully, on a timely basis, on areas of significant risks and
judgement. The Board has confirmed that it is satisfied that
Audit Committee members possess an appropriate level of
independence and depth of financial and FinTech expertise.
79 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Report of the Audit Committee
On his appointment in July 2021, David Bull, the Chair of the
Audit Committee, was determined by the Board as having
recent and relevant financial experience. Full biographies of
the members of the Audit Committee during the year can be
found in the Corporate Governance Report on pages 63–67.
The Audit Committee is satisfied that it receives sufficient
and timely information and has access to relevant
management personnel to allow the Audit Committee
members to engage in an informed debate during Audit
Committee meetings and to fulfil its responsibilities.
Principal activities in 2023
During 2023 the Audit Committee meetings have focused on
the principal matters set out below:
> Reviewed the 2022 annual report and consolidated
financial statements.
> Reviewed the 2023 interim financial results and any RNS’s
containing references to financial data.
> Monitored the Company’s risk management framework
and updating of the risk register.
Significant issues considered in relation to the financial
statements
As part of its monitoring of the integrity of the financial
statements, the Audit Committee reviews whether suitable
accounting policies have been adopted and whether
management has made appropriate estimates and
judgements and seeks support from the external auditor to
assess these. The Audit Committee considered the following
significant judgements and other areas of audit focus in
respect of the financial statements for the year ended 31
December 2023. These areas have been identified as being
significant by virtue of their materiality, complexity, being
accounting items which are new for the current financial
year, or the level of judgement and/or estimation involved.
In order to ensure the approaches taken were appropriate,
the Audit Committee considered reports from both
management and the external auditor produced at relevant
points during the year. The Audit Committee challenged
judgements and sought clarification where necessary.
> Reviewed key findings from the 2022 year end Group
audit and review of the 2023 external audit plan with the
external auditors.
> Considered key accounting matters, including key
The Audit Committee received a report from the
management and the external auditor on the work it had
performed to arrive at its conclusions and discussed in detail
all material findings contained within the report.
accounting judgements and estimates, and accounting
standards that were either newly issued or applicable to
the Group due to changing circumstances.
> Reviewed the output of any work produced by third
party accounting advisors to support the key accounting
matters.
> Assessment of going concern and cash flow forecasting
at regular intervals during the year and at least at those
times as required for formal sign off of the going concern
assessment in annual report and accounts and interim
report.
> Oversight, review and challenge of any key parameters
of the financial contractual documents in connection
with the TradeFlow Restructuring and new funding
arrangements agreed during 2023.
> Oversight of the regulatory compliance required in
connection with the publication of the supplementary
prospectuses issued on 4 May 2023 and 30 June 2023.
> Reviewed the Audit Committee terms of reference.
> Considered the need for an internal audit function.
> Continued assessment of the skills and knowledge within
the finance team.
Alternative performance measures (“APMs”) and
presentations not specifically defined by IFRS:
Reporting issue:
The Group has chosen to continue to use an APM which is
not specifically defined by IFRS, being Operating loss from
continuing operations before impairment charges and fair
value adjustments, to illustrate the impact on earnings from
continuing operations before impairment charges and fair value
adjustments to equity investments. This APM is used in order to
present clearly the underlying costs and results of the Group.
Review of the Audit Committee:
The Audit Committee reviewed the use of these and
calculation of this APM and agreed with management
that this measure has been appropriately calculated
and disclosed as a non-GAAP measure in the financial
statements. The Audit Committee is satisfied that the non-
GAAP measure is not given undue prominence and that the
reconciliations provided are presented in a clear manner.
Going concern
Reporting issue:
The Directors must satisfy themselves regarding the Group’s
ability to operate as a going concern and confirm that they
have a reasonable expectation that the Group will continue
to operate and meet its liabilities as they fall due for the 12
months following the date at which these consolidated financial
statements for the year ended 31 December 2023 are issued.
80 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
As with the due diligence fee revenue, management needed
to consider, and apply certain judgements with respect to
the different performance obligations in relation to the each
of the activities above in order to establish if the revenue
recognition profile in accordance with IFRS 15 (“Revenue
from Contracts with Customers”) was point in time or over
time, particularly given that some of the contracts extend
over more than one financial reporting period.
Review of the Audit Committee:
In connection with the review of the interim and annual
financial statements, the Audit Committee received reports
from management that outlined the judgements made about
the performance obligations under each of the contracting
agreements. These reports were carefully reviewed,
challenged, and discussed in conjunction with input from the
external auditor. With respect to the fees referred to above,
management applied the following key judgements:
a) The due diligence services performed represent a distinct
beneficial service to the client companies receiving these
services, and as such the revenue is recognised at the
completion of the due diligence services;
b) The non-refundable origination fees received from the
client company relate to the fee payable to the Group at
the point in time the client company enters into binding
contracts with the stock (trading) company to purchase its
inventory. It was noted that it does not relate to any transfer
of assets from the Group to the client company and as
a result, management concluded there is no separately
identifiable performance obligation carried out by the
Group associated with this fee. As such the recognition of
the non-refundable origination fee as revenue is at the
point in time that the fee becomes payable given that
there are no performance obligations that remain to be
completed by the Group relating to this fee;
c) The usage of the Platform granted by the Group to the
stock (trading) company represented a Software as a
Service (“SaaS”) contract, and as the related requirements
of IFRS 15 (“Revenue from Contracts with Customers”)
were satisfied the annual Platform usage fees are
recognised over time; and
d) The service fees received in exchange for the support
and administration activities relate to this separately
identifiable performance obligation and as such the
annual fees are recognised over time in line with the
relevant requirements set out in IFRS 15 (“Revenue from
Contracts with Customers”).
Review of the Audit Committee:
The Audit Committee reviewed management’s cash flow
forecasts, including an overview of the assumptions
made in the preparation of the base case supporting
the going concern statement. This included the Group’s
consolidated cash flow forecasts covering 2024 – 2025. The
Audit Committee discussed and challenged the cash flow
forecasts and assessed this in light of the principal risks and
uncertainties set out within this annual report and accounts.
Given the continued delays experienced by the business
during 2023, the Audit Committee discussed and challenged
the downside scenarios modelled as part of the going
concern statement. The downside scenarios reduced the
Group’s revenue generation but also looked at cost saving
measures that would be implemented in such instances.
These downside scenarios also looked at committed funding
that is either available to the Group at the date of signing
these accounts, or which the Directors have determined is
reasonable to include. In conclusion, the Audit Committee
have recommended to the Board that the going concern
statement include material uncertainty primarily in regard
to the timing of ongoing Inventory Monetisation revenue
streams, and certain cash inflows that have been committed
to the Group but which the cash have not yet been received.
Revenue recognition
Reporting issue:
Prior to the Group’s facilitation of the first Inventory
Monetisation transaction in October 2022, revenue generated
from the Inventory Monetisation operating segment consisted
of due diligence fees. The contracting arrangements for the
due diligence fees have changed over time and a large portion
of the fees received in prior periods were from a contract with
a related party. In determining the correct revenue recognition
profile for the due diligence fees under IFRS 15 (“Revenue
from Contracts with Customers”), management needed to
consider, and apply certain judgements with respect to the
different performance obligations from historical contracting
agreements, current contracting agreements, and contracting
agreements with the related party.
In connection with the first two Inventory Monetisation transactions
that took place in 2022 and 2023, the Group received fees for
the first time in connection with the following activities:
a) origination of the contracts between the client company
and the independent stock (trading) company that
purchased the inventory;
b) usage of the Group’s IM Platform by the independent
stock (trading) company in order to facilitate the purchase
of the inventory from the client company; and
c) service fees charged to the independent stock (trading)
company by the Group in terms of the support and
administration activities such as the monitoring of the
inventory purchased using the Group’s IM Platform.
81 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Report of the Audit Committee
Capitalisation of costs directly attributable to the
internally generated Inventory Monetisation (“IM”)
Platform
Reporting issue:
The Group continues to invest in the development of its IM
Platform. During the current financial period management
was required to exercise judgement to distinguish those
costs that were capable of being capitalised under IAS 38
(“Intangible assets”) and those costs that related to research
and development activities, which have been recognised as
an expense during the relevant period
Review of the Audit Committee:
The Audit Committee reviewed reports from management
that detailed the judgements applied in determining which
costs would meet the criteria for capitalisation. This was
assessed in conjunction with feedback provided from the
external auditor. The Audit Committee noted that to date
only external costs have been capitalised and concurred with
management’s approach to the amounts to be capitalised.
Accounting for issue of share warrants
Reporting issue:
During the current year the Company has new equity funding
facilities, in order to support the Group through its early-stage
development. One of the terms of this new equity funding
was the issue of new share warrants as an associated cost.
Management was required to assign a fair value of these
warrants in line with IFRS 2 (“Share-based Payments”) and
ensure the cost of these was appropriately recognised in the
financial statements for the year ended 31 December 2023.
Review of the Committee:
In order to determine the fair value of the various share
warrants that have been issued, management engaged a
third-party accounting advisor to carry out the IFRS 2 fair
value exercise. This detailed analysis was also shared with the
Audit Committee, and alongside discussions with the external
auditors, the Audit Committee are satisfied that these
complex funding arrangements have been appropriately
account for and disclosed in the financial statements.
Accounting for discontinued operations and the
TradeFlow Restructuring
Reporting issue:
During the second half of 2022, the Directors began the
process of the TradeFlow Restructuring and as part of the
preparation of the consolidated financial statements for the
year ended 31 December 2022, management considered
the application of IFRS 5 (“Non-current Assets Held for Sale
and Discontinued Operations”) to the TradeFlow business.
At this point in time, management considered the factors
that needed to be in place in order for a business or asset
to be classified as held for sale or a discontinued operation
and concluded that as at 31 December 2022, TradeFlow
was available for immediate sale in its present condition and
it was highly probably that that sale would be completed.
As such, the TradeFlow business has been classified as a
discontinued operation as at 31 December 2022.
This classification of TradeFlow continued in the first half of
2023 until 30 June 2023, when the finalisation of TradeFlow
Restructuring occured. At this point in time, the disposal of
the 81% stake in the TradeFlow business was accounted
for in both the Company, and consolidated Group, financial
statements. This resulted in the deconsolidation of
TradeFlow from 30 June 2023 in accordance with IFRS 10
(“Consolidated Financial Statements”), the recognition of any
loss / gain on disposal in the relevant financial statements,
and the recognition of the remaining 19% stake in TradeFlow
as an investment in both the Company, and consolidated
Group, financial statements.
Review of the Audit Committee:
In order to review management’s judgement regarding the
classification of the TradeFlow business in the first half of
2023, the Audit Committee reviewed the analysis against the
IFRS 5 criteria that was presented to the Audit Committee
by management. This analysis was also discussed with the
external auditors as part of the year end audit procedures
for the year ended 31 December 2022. Following this review
and discussion, the Audit Committee concluded that the
disclosure of the TradeFlow business as a discontinued
operation was appropriate for the first half of 2023.
Following the completion of the TradeFlow Restructuring,
the Audit Committee reviewed the work undertaken by
management to record the effect of this transaction in both
the Company, and consolidated Group financial statements.
This was reviewed alongside the analysis and detailed
calculations provided by management of the resulting loss
of disposal recognised in the Company financial statements,
and the gain on disposal recognised in the consolidated
Group financial statements.
In carrying out these calculations, the key judgement made
by management, and reviewed by the Audit Committee,
related to the discount factor applied to the fair value of
the remaining 19% investment that continued to be held
in TradeFlow following 30 June 2023. This discount factor
reflects the fact that the Group no longer holds control over
the operations of TradeFlow.
82 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Impairment reviews
Reporting issue:
The Group is required to annually assess any investment
and intangible assets, including goodwill, for impairment. At
the Group level, an impairment review took place in relation
to the internally generated IM platform.
The Group has recognised an intangible asset in respect
of its internally generated IM Platform, and has continued
to capitalise costs in line with IAS 38 (“Intangible assets”)
during the current financial year. During the preparation
of the FY21 annual report and accounts, this intangible
asset was fully impaired based on the fact that the material
uncertainties that existed in the going concern statement,
also applied to the Groups IM Platform asset. Given the
continued delays the Group has faced in achieving more
than its first initial IM transaction, managements assessment
was that the indicators of impairment continued to exist
as at 31 December 2022, and further as at 31 December
2023. In line with the judgements applied in the prior years,
and the fact that similar material uncertainties existed in
the going concern statement in the current financial year,
management again chose to fully impair the value of the
Group’s IM Platform as at 31 December 2023.
The Parent Company is required to annually assess for
impairment the investments that it currently holds at carrying
value of Supply@ ME S.r.l. and Supply@ME Technologies S.r.l.
During the year ended 31 December 2021, the full amount
of the investment in Supply@ME S.r.l. was impaired, along
with the full amount of any intercompany receivable
balances in both Supply@ME S.r.l. and Supply@ME
Technologies S.r.l., as applicable at the time. This followed
the same rationale as noted above for the impairment
review of the internally generated IM platform asset. During
2022 and the current financial year, management followed
the same approach and recognised additional impairment
charges as required.
Review of the Audit Committee
The Audit Committee reviewed papers from management
which set out the key assumptions and judgements
underpinning the impairment assessments referred to
above. The Group’s external auditors provided their view of
the assessment to the Audit Committee.
After due consideration and discussion, the Audit Committee
concluded that it agreed with the impairment reviews carried
out by management during the year ended 31 December 2023
and this resulted in the impairment charges being appropriately
recognised in both the Group’s consolidated financial statements
and the Company’s stand alone financial statements.
Fair, Balanced and Understandable
The Audit Committee supports the Board in ensuring that
the Annual Report is fair, balanced and understandable
and as such has given due consideration as to whether
the Annual Report and Accounts, taken as a whole, is fair,
balanced and understandable and provides the information
necessary for shareholders to assess the Group’s position
and performance, business model and strategy and can
confirm that this is the case.
Risk Management and Internal Controls
The Board has overall responsibility for determining the
nature and extent of its principal and emerging risks and
the extent of the Group’s risk appetite, and to ensure
any identified weaknesses are appropriately dealt with.
Further details of the principal risks and uncertainties facing
the Group are addressed on pages 50–60. The Board
has delegated to the Audit Committee the responsibility
for monitoring the effectiveness of the systems of risk
management. The Audit Committee remains pleased with
the improvements made to the Group’s internal financial
controls over the year, however this continues to remain
a key area of continued focus for the Audit Committee to
ensure controls are developed and improved in line with the
Group’s developing operations.
Internal Audit
The Audit Committee has considered if the Group’s internal
controls processes would be significantly enhanced by an
internal audit function and has taken the view that, given
the size of the Group’s current operations, the internal
controls in place and significant executive involvement in the
Group’s day to day business, an internal audit function is not
required at this stage. However, the Audit Committee will
keep this under review especially as the Group’s operations
grow and develop.
External Audit
The Audit Committee reviews the independence and
objectivity of the external auditor prior to the proposal
of a resolution to shareholders at the Annual General
Meeting concerning the appointment and remuneration
of the auditor. This process includes the review of audit
fee proposals, investigation and approval for non-audit
services’ fees, tenure and audit partner rotation (based on
best practice and professional standards within the United
Kingdom). The Group’s auditor, Crowe U.K. LLP (“Crowe”),
similarly considers whether there are any relationships
between itself and the Group that could have a bearing
upon Crowe’s independence and has confirmed its
independence to us.
83 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Report of the Audit Committee
Each year the Audit Committee obtains written confirmation
of the auditor’s independence. Crowe have been the Group’s
auditors since the Group listed on the London Stock Exchange
in March 2020, and the current external audit partner is
Leo Malkin who was also appointed at this time. Having
reviewed the auditor’s independence and performance, the
Audit Committee has concluded that these are effective and
recommends that Crowe be reappointed at the next AGM.
The Audit Committee also has responsibility for approving the
nature of non-audit services which the external auditor may or
may not be allowed to provide to the Company and the fees
paid for these services. Currently all non-audit services would
need to be approved by the Audit Committee if they were to
be undertaken by the external auditor. During the current
financial year, no non-audit services were carried out by Crowe.
The auditor prepares an annual planning report for
consideration by the Audit Committee, which details areas of
audit focus and anticipated key audit risks, together with the
anticipated level of materiality. This is reviewed and approved
by the Audit Committee. Following the audit, the auditor
presented its findings to the Audit Committee. No significant
areas of concern were raised by the external auditor.
Board and Committee Evaluation
A thorough Board and Committee evaluation took place
during November 2023. This performance evaluation was
conducted by assessing the below areas:
> Processes that underpin Board effectiveness
> Board and Committee constitution and commitment
> Board dynamics
> Culture, stakeholder oversight and strategy
In light of this evaluation the Audit Committee will continue
to assess its current skill set and will highlight to the
Nomination Committee if there are any issues that arise
in the future due to lack of specific skill set or knowledge,
particularly as the Group continues to grow in both size and
complexity. Additionally, the Audit Committee will continue
to assess the information provided to them by management
and provide effective feedback to help improve the quality
and timeliness of this information.
David Bull
Chair, Audit Committee
30 April 2024
84 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Directors’ Remuneration Report
Annual statement from the Remuneration Committee
I joined the Board as Chair of the Remuneration Committee
in March 2023 and am pleased to present, on behalf of the
Board, our Directors’ Remuneration Report for the year
ending 31 December 2023.
In line with the UK reporting regulations, this Directors’
Remuneration Report is split into three sections:
> this Annual Statement which summarises the work of the
Committee and our approach to remuneration;
> the Directors’ Remuneration Policy which shareholders
voted 99.28% in favour of at the AGM on 23 June
2023 and which provides details of our approach to
remuneration and the parameters within which we
implement pay arrangements going forward, and how
this links to our strategy; and
> the Annual Report on Remuneration, which sets out the
remuneration arrangements and incentive outcomes for
the year under review and how the Committee intends
to implement the Remuneration Policy in FY 2024. The
Annual Report on Remuneration is subject to an advisory
shareholder vote at the AGM in 2024.
Remuneration in FY 2023
During 2023 the Remuneration Committee has continued
to monitor the pay of the Executive Director, Chair and Non-
Executive Directors, based on benchmarking of companies
of a similar market capitalization and listed on either AIM
or the Main Market. The current sole Executive Director,
being the CEO, continues to be paid below market levels,
taking into account the size and nature of the business. The
Committee has decided that, whilst the Group is still working
towards achieving profitability, it is not currently appropriate
to increase remuneration levels for the CEO; this will be kept
under review and re-considered once the economics of the
business justify it.
Fee levels for Non-Executive Directors are a matter for the
Chair and Executive team. Non-Executives’ fees were also
reviewed in light of external benchmarking. This review
demonstrated the Non-Executive Directors are all underpaid
comparative to market.
As outlined in the 2021 and 2022 reports, consistent with
general market practice, the Committee has decided that
it would be appropriate to gradually introduce an annual
bonus and long-term incentive arrangement.
On 19 May 2023 the second Long Term Incentive Plan
Awards were made, the performance conditions being:
> The Absolute TSR Performance Condition: 50% of the
award to be based on absolute TSR over 3 financial
years, requiring (assuming no dividends) the average
closing share price over the period 1 October 2025 – 31
December 2025 to be 0.15p for 25% of the award to vest
increasing on a straight-line basis to 0.3p for 100% to
vest.
> The Inventory Monetisation performance condition:
50% of the award to be based on volume of inventory
monetised by the end of the performance period (31
December 2025). 25% of award to vest if £300m of
inventory is monetized (in aggregate) over the 3 financial
years ending 31 December 2025, increasing on a straight
line basis to 100% of the award to vest if £400m of
inventory is monetized (in aggregate) in the same period.
This is contingent on the Remuneration Committee
deeming the inventory was monetised on acceptable
commercial terms.
The satisfaction of the Performance Conditions (in whole or
in part) and vesting of an Award will be subject to the general
discretion of the Remuneration Committee. The Committee
has broad discretion to reduce vesting if it considers
the level of vesting to be inappropriate having regard to
affordability, risk management and other factors.
As part of the introduction of the LTIP, Executive Directors
became subject to share ownership guidelines requiring
them to build up a holding of shares worth at least 200% of
base salary (and to normally continue to hold such shares
for 2 years’ post-cessation). The Chief Executive Officer, being
the only Executive Director at 31 December 2023, currently
holds over this threshold as set out later in this Directors’
Remuneration Report.
No bonus payments were made to Executive Directors
during the year ending 2023.
85 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Directors’ Remuneration Report
Implementation of the Directors’ Remuneration Policy in
FY2024
As explained above, the remuneration levels of the Executive
and the Non-Executive Directors (excluding the Chair) are
both below market level. The Committee has concluded
this will be considered more broadly as and when it is
considered affordable.
The Committee has given consideration to the performance
conditions for the 2024 Long Term Incentive Plan Awards,
which aim to align to shareholders’ needs. Further details of
this are provided in the annual report on remuneration.
At the 2023 AGM an annual bonus plan was included as
part of the new Remuneration Policy. The Policy permits the
operation of a bonus plan with Executive Directors eligible to
receive a bonus of up to 100% of base salary. The Committee
has given consideration to the implementation of the bonus
plan for Executive Directors during 2023 in line with this policy
and concluded to not yet approve a plan for 2023 or 2024.
The Remuneration Committee will consider this prudently
during 2024 in light of revenue and cash flow. If significant
progress is made on the Group’s key financial targets a variable
pay pool would be formed based on a combination of profit
and satisfaction of strategic and personal objectives. These
objectives will be linked to the Group’s strategy and aligned
with key financial, strategic and/or individual targets and be
governed by the Remuneration Policy.
Conclusion
We continue to be committed to a responsible approach
to executive pay, which I hope this Directors’ Remuneration
Report demonstrates. The Committee recognises the
importance of developing a close relationship with
shareholders in facilitating the work of the Committee in
developing our pay arrangements. I am happy to meet
or speak with shareholders if there are any questions or
feedback on our approach to executive remuneration and
if you have any comments or feedback on this report, then
please let me know through the Company Secretary.
I look forward to receiving your support at the 2024 AGM.
On behalf of the Remuneration Committee.
Alexandra Galligan
Chair of the Remuneration Committee
30 April 2024
86 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Directors’ Remunerations Report – at a glance
Our pay principles
Promotion of the long-term success of the Group
The principal aim of the Directors’ Remuneration Policy is the ability to offer competitive remuneration packages which
are designed to attract, retain and provide appropriate incentives to Executive Directors and Leadership Team 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 our shareholders.
Implementation of our Policy in FY 2024
Fixed Pay
Salary / fees
> CEO - GBP £207,000
Pension
Benefits
> CEO - 6% of salary
> CEO entitled to life assurance and health insurance, however
he has not taken up the health insurance benefit
Annual Bonus
Maximum
> 100% of salary
> 2024 plan not yet approved. Consideration will be given by the
Committee during 2024 to the implementation of a 2024 plan
in line with the policy
Performance Measures
> Individual bonuses allocated based on delivery of corporate
and/or individual performance objectives
Operation
> Any bonus in excess of 50% of salary deferred into shares for
three years
> Malus and clawback provisions operate
Long Term
Incentive Plan
Award Level
> Up to 100% of salary, the CEO will receive a grant over shares
worth a maximum of 100% of salary
Performance Measures
Operation
> 50% of the award based on absolute TSR over 3 financial
years & 50% of the award based on volume of inventory
monetised over the same period
> Performance measured over three years
> Two-year additional holding period applies to vested awards
> Malus and clawback provisions operate
Share ownership
guidelines
In-employment guideline
> 200% of salary
Post-cessation guideline
> 200% of salary to be held for two years post-employment
Shareholding as a
multiple of salary at
31 December 20231
> CEO – 46.14
1
The shareholding as a multiple of salary has been calculated using the value of the shareholding held at 31 December 2023 compared to the full year salary
for the year ended 31 December 2023.
87 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Directors’ Remuneration Report
As announced on 4 April 2024, the number of shares of
the Company held by the CEO, through the AvantGarde
Group S.p.A increased by 1,500,000,000 to a total of
16,194,038,529. There have been no other changes between
31 December 2023 and 19 April 2024, being the latest
practicable date prior to the publication of this report.
considered as part of the Committee’s annual review of the
remuneration policy and its implementation.
The Remuneration Committee also actively monitors
developments in the expectations of institutional investors
and considers good practice guidelines from institutional
shareholders and shareholder bodies.
Directors Remuneration Policy
This part of the Directors’ Remuneration Report sets out the
Directors’ Remuneration Policy which shareholders voted
99.28% in favour of at the AGM on 23 June 2023 and which
provides details of our approach to remuneration and the
parameters within which we implement pay arrangements
going forward, and how this links to our strategy. This Policy
formally applies for three years beginning on the date of
approval (23 June 2023) unless a new policy is presented to
shareholders in the interim. All payments to Directors are
consistent with the approved Policy.
Considerations when determining the Directors’
Remuneration Policy
The overarching objective of the Policy is to promote the
long-term success of the Group. In seeking to achieve this
objective the Remuneration Committee takes account of the
following guiding principles:
> remuneration packages should be clear and simple
> arrangements should be closely aligned with the interests
of shareholders and other key stakeholders and ensure
that the Company is not unduly exposed to risk
> remuneration should align with, and support, our values
> a significant proportion of remuneration should be based
on performance-related components with potential
rewards subject to the achievement of challenging
performance targets based on measures linked to the
Group’s KPIs and to the best interests of stakeholders
and
> salaries and the overall level of potential remuneration
should be competitive but not excessive when compared
with other companies of a similar size, scale and
geographical reach and should be sufficient to recruit,
retain and motivate individuals of the requisite calibre to
deliver long-term success.
Consideration of shareholders’ views
The Committee is committed to an ongoing dialogue
with shareholders and welcomes feedback on Directors’
remuneration. The Committee will seek to engage
appropriately with major shareholders and their
representative bodies on changes to the Policy. The
Committee will also consider shareholder feedback received
in relation to the remuneration-related resolutions each
year following the AGM. This, plus any additional feedback
received from time to time (including any updates to
shareholders’ remuneration guidelines), will then be
Consideration of employment conditions elsewhere in
the Group
The Committee closely monitors the pay and conditions
of the wider workforce and the design of the Directors’
Remuneration Policy is informed by the policy for employees
across the Group. While employees are not formally directly
consulted on the design of the Directors’ Remuneration
Policy, we have a relatively small workforce which allows
the Board to regularly engage directly with employees.
In addition, the Committee receives periodic updates on
remuneration arrangements and employment conditions
across the Group from the Chief People Officer.
Differences in pay policy for Executive Directors in
comparison to employees more generally
The overall approach to reward for employees across
the workforce is a key reference point when setting the
remuneration of the Executive Directors. As for the Executive
Directors, general practice across the Group is to recruit
employees at competitive market levels of remuneration,
incentives and benefits to attract and retain employees,
accounting for local conditions. When affordable for the
Company, it is envisaged that all employees will be able to earn
annual bonuses for delivering exceptional performance and
the corporate measures used to generate the bonus pool
apply to all employees participating in the annual bonus plan.
The key difference between the remuneration of Executive
Directors and that of our other employees is that, overall, at
senior levels, remuneration is increasingly long term, and ‘at
risk’ with an emphasis on performance-related pay linked to
business performance and share based remuneration.
This ensures that remuneration at senior levels will increase
or decrease in line with business performance and provides
alignment between the interests of Executive Directors and
shareholders.
In particular, performance-based long-term incentives are
normally reserved for those considered to have the potential
to influence overall levels of performance.
88 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Policy table for Executive Directors
The table below sets out the main components of approved
Directors’ Remuneration Policy, together with further
information on how these aspects of remuneration operate.
The Remuneration Committee has discretion to amend
remuneration to the extent described in the table and the
written sections that follow it.
Component
Base Salary
Purpose and
link to strategy
To provide
competitive
fixed
remuneration.
To attract and
retain
Executives of a
superior
calibre.
Performance
measures
Although there are
no formal
performance
conditions, any
increase in base
salary is only
implemented after
careful
consideration of
individual
contribution and
performance and
having due regard
to the factors set
out in the
Operation column
of this table.
Operation
Maximum opportunity
Salaries are usually
reviewed annually, with
any increases typically
effective from the start of
the financial year.
Salaries are typically set
after considering:
> pay and conditions
elsewhere in the
Group
> overall Group
performance
> individual
performance and
experience
> progression within the
role and
> competitive salary
levels in companies of
a broadly similar size,
scale and complexity.
While there is no
prescribed maximum
salary or maximum
increase, increases will
normally be in line with
the typical range of salary
increases awarded (in
percentage of salary
terms) to the wider
workforce.
Larger salary increases
may be awarded to take
account of individual
circumstances, such as:
> where an Executive
Director has been
promoted or has had
a change in scope or
responsibility
> where the Committee
has set the salary of a
new hire at a discount
to the market level
initially, a series of
planned increases can
be implemented over
the following few years
to bring the salary
to the appropriate
market position,
subject to individual
performance or
> where the Committee
considers it
appropriate to adjust
salaries to reflect
the continuing
development of the
Company
Increases may be
implemented over such
time period as the
Committee deems
appropriate.
89 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Directors’ Remuneration Report
Component
Benefits
Purpose and
link to strategy
To provide
competitive
fixed
remuneration.
To attract and
retain
Executives of a
superior
calibre.
Operation
Maximum opportunity
Executive Directors are
currently entitled to
benefits including life
assurance and health
insurance.
As it is not possible to
calculate in advance the
cost of all benefits, a
maximum is not
pre-determined.
Performance
measures
Not applicable.
The maximum level of
participation in all-
employee share plans is
subject to the limits
imposed by the relevant
tax authority from time
to time.
Executive Directors will
be eligible for any other
benefits which are
introduced for the wider
workforce on broadly
similar terms, Other
benefits (including a car
or car allowance) might
be provided from time to
time based on individual
circumstances and if the
Committee decides
payment of such benefits
is appropriate.
For external and internal
appointments or
relocations, the Company
may pay certain
relocation and/or
incidental expenses as
appropriate (for up to
two years from
recruitment).
Any reasonable business-
related expenses can be
reimbursed (and any tax
thereon met if
determined to be a
taxable benefit).
Executive Directors are
also provided with the
opportunity to participate
in any all-employee share
plan arrangements on
the same basis as other
employees.
Pension
To provide
employees with
long-term
savings to allow
for retirement
planning.
The Group may offer
participation in a defined
contribution pension
plan or may permit
Executive Directors to
take a cash supplement
in lieu of pension up to
the same value.
The maximum
employer’s contribution
or cash allowance in lieu
of pension is limited to
up to the contribution
levels of the majority of
the workforce (currently
6% of salary).
Not applicable.
90 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Component
Annual Bonus
Purpose and
link to strategy
Rewards
achievement of
annual financial
and business
targets aligned
with the KPIs of
the Group.
Bonus deferral
encourages
long-term
shareholding,
provides a
retention
element and
discourages
excessive risk
taking.
Operation
Maximum opportunity
Awards are based on
performance typically
measured over one year.
Maximum annual bonus
opportunity is 100% of
base salary.
Any payment is
discretionary and pay-out
levels are determined by
the Committee after the
year end based on
performance against
pre-set targets.
A bonus plan has not yet
been approved for 2024.
The Remuneration
Committee will consider
this prudently during
2024 in light of revenue
and cash flow.
Bonus is normally paid in
cash, except for any
bonus in excess of 50%
of base salary which is
deferred into an award
over shares, typically for
a three-year period.
Dividends or dividend
equivalents may accrue
on deferred share
awards.
The vesting of the
deferred share awards is
not subject to the
satisfaction of any
additional performance
conditions.
The annual bonus plan
includes malus and
clawback provisions
which enable the
Committee (in respect of
both the cash and the
deferred elements of
bonuses) to recover or
withhold value in the
event of certain defined
circumstances (i.e. in
cases of gross
misconduct, material
misstatement of financial
results, error in
calculation, material risk
failings, reputational
damage or corporate
failure).
Performance
measures
It is intended that a
variable pay pool is
formed based on a
combination of
profit and
satisfaction of
strategic and
personal objectives
although the
Committee may
adopt alternative
arrangements
within the overall
cap.
Targets are set
annually with
measures linked to
the Group’s strategy
and aligned with
key financial,
strategic and/or
individual targets.
The performance
measures applied
may be financial or
non-financial,
corporate, divisional
or individual, and in
such proportions as
the Committee
considers
appropriate.
A graduated scale
of targets is set for
each measure, with
no pay-out for
performance below
a threshold level of
performance.
The Committee has
discretion to amend
the pay-out should
any formulaic
outcome not reflect
the Committee’s
assessment of
overall business
performance.
91 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Directors’ Remuneration Report
Component
Long Term
Incentive Plan
(“LTIP”)
Purpose and
link to strategy
To incentivise
Executive
Directors, and
to deliver
genuine
long-term
performance-
related pay,
with a clear line
of sight for
Executives and
direct
alignment with
shareholders’
interests.
Performance
measures
LTIP performance
measures may
include, but are not
limited to, financial,
TSR, strategic and
ESG-related
objectives.
The Committee
retains discretion to
set alternative
measures and
weightings for
awards over the life
of the Policy.
Targets are set and
assessed by the
Committee in its
discretion.
A maximum of 25%
of any element
vests for achieving
the threshold
performance target
and 100% for
maximum
performance.
The Committee has
discretion to reduce
the vesting level
should any
formulaic outcome
not reflect the
Committee’s
assessment of
overall business
performance.
Operation
Maximum opportunity
The LTIP allows for
awards over shares with
a maximum value of
100% of base salary per
financial year (the
Committee reserves the
discretion to grant
awards up to a maximum
value of 200% of base
salary per financial year
for recruitment related
awards or in exceptional
circumstances).
Actual participation levels
will be kept under regular
review, and the
Committee expressly
reserves discretion to
make such awards as it
considers appropriate
within the plan limits.
Awards will be in the form
of nil or nominal-cost
share options, conditional
shares or other such form
as has the same economic
effect.
Awards will normally be
granted with vesting
dependent on the
achievement of
performance conditions
set by the Committee, with
performance normally
measured over at least a
three-year performance
period.
In line with best practice
for financial-services
companies, ‘restricted
stock’ LTIP awards may be
made to control function
personnel (e.g. Chief Risk
Officer) which are not
subject to performance
measures.
Awards will be subject to a
further two-year holding
period, and shares will
typically not be released to
participants until the end
of any such holding period.
During the vesting period
(and the additional holding
period) the value of any
dividends on performance
vested shares will be
credited as re-invested in
further LTIP award shares.
The LTIP includes malus
and clawback provisions
which enable the
Committee to recover or
withhold value in the event
of certain defined
circumstances (i.e. in cases
of gross misconduct,
material misstatement of
financial results, error in
calculation, material risk
failings, reputational
damage or corporate
failure).
92 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Component
Share
ownership
guidelines
Purpose and
link to strategy
To ensure that
Executive
Directors’
interests are
aligned with
those of
shareholders
over a longer
time horizon.
Operation
Maximum opportunity
Performance
measures
Not applicable.
Not applicable.
Executive Directors are
expected to accumulate
and maintain a holding in
shares in the Company
equivalent in value to no
less than 200% of base
salary.
Executive Directors will
be expected to retain the
lower of actual shares
held at cessation and
shares equal to 200% of
salary for two years
post-cessation.
These guidelines apply in
respect of any shares
which vest from Supply@
ME share awards
granted after the 2022
AGM.
93 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Directors’ Remuneration Report
Component
Chairman and
Non-Executive
Directors’ fees
Purpose and
link to strategy
To attract high
calibre
individuals and
to
appropriately
reflect
knowledge,
skills and
experience.
Performance
measures
Not applicable.
Operation
Maximum opportunity
The aggregate fees and
any benefits of the
Chairman and Non-
Executive Directors will
not exceed the limit from
time to time prescribed
within the Company’s
Articles of Association for
such fees (currently
£500,000 p.a. in
aggregate).
Any increases actually
made will be
appropriately disclosed.
Fees are normally
reviewed annually taking
into account factors such
as the time commitment
and contribution of the
role and market levels in
companies of
comparable size and
complexity.
The Non-Executive
Chairman is paid an
all-inclusive fee for all
Board responsibilities.
Fees for the other
Non-Executive Directors
may include a basic fee
and additional fees for
further responsibilities
(for example, holding the
office of Senior
Independent Director or
chairing of Board
Committees).
The Company repays any
reasonable expenses
that a Non-Executive
Director incurs in
carrying out their duties
as a Director, including
travel, hospitality-related
and other modest
benefits and any tax
liabilities thereon, if
appropriate.
In exceptional
circumstances, if there is
a temporary yet material
increase in the time
commitments for the
Chairman or Non-
Executive Directors, the
Board may pay extra fees
on a pro rata basis to
recognise the additional
workload.
The Chairman and
Non-Executive Directors
cannot participate in any
of the Group’s incentive
arrangements.
94 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Explanation of performance measures chosen
Performance measures for the annual bonus, once
introduced, will be selected annually to align with the KPIs
and prevailing strategic imperatives of the Group, and
the interests of shareholders and other stakeholders.
Financial measures will normally be used to determine
the overall bonus pool (e.g. as a % of group pre-tax profit)
and the individual allocations will be made based on key
strategic and/or personal objectives designed to ensure
that Executive Directors are incentivised to deliver across
a range of objectives. “Target” performance is typically set
in line with the business plan for the year, with threshold
to stretch targets set around this based on a sliding scale
which takes account of relevant commercial factors. Only
modest rewards are available for delivering threshold
performance levels, with rewards at stretch requiring
material outperformance of the business plan. Details of the
specific measures used for the annual bonus are set out in
the Annual Report on Remuneration.
Performance measures for the LTIP are selected in order
to provide a robust and transparent basis on which to
measure the Group’s performance, to demonstrably link
remuneration outcomes to delivery of the business strategy
over the longer term, and to provide strong alignment
between senior management and shareholders. They
should not be considered as the goals for the business,
but rather as the level considered by the Committee to
be appropriate to facilitate the overarching goals of the
LTIP, to reward and retain key staff. The policy provides
for Committee discretion to alter the LTIP measures and
weightings to ensure they can continue to facilitate an
appropriate measurement of performance over the life of
the policy, taking account of any evolution in the Group’s
strategic ambitions. The measures for the 2022 grant were
absolute TSR (equivalent to a range of 0.6945-1p over the
last 3 months of FY 2024). The performance measures for
the 2023 grant were:
> 50% of the award to be based on absolute TSR over 3
financial years, requiring (assuming no dividends) the
average closing share price over the period 1 October
2025 – 31 December 2025 to be 0.15p for 25% of the
award to vest increasing on a straight-line basis to 0.3p
for 100% to vest.
> 50% of the award to be based on volume of inventory
monetised by the end of the performance period (31
December 2025). 25% of award to vest if £300m of
inventory is monetized (in aggregate) over the 3 financial
years ending 31 December 2025, increasing on a straight-
line basis to 100% of the award to vest if £400m of
inventory is monetized (in aggregate) in the same period.
This is contingent on the Remuneration Committee
deeming the inventory was monetised on acceptable
commercial terms.
The performance measures for the 2024 grant will remain
the same as those set for the 2023 grant, with adjusted
performance periods. This decision has been reached due
to the decline in the share price since the 2023 performance
measures were set and also recognising that the volume of
inventory monetised has not grown at the rate anticipated:
> 50% of the award to be based on absolute TSR over 3
financial years, requiring (assuming no dividends) the
average closing share price over the period 1 October
2026 – 31 December 2026 to be 0.15p for 25% of the
award to vest increasing on a straight-line basis to 0.3p
for 100% to vest.
> 50% of the award to be based on volume of inventory
monetised by the end of the performance period (31
December 2026). 25% of award to vest if £300m of
inventory is monetized (in aggregate) over the 3 financial
years ending 31 December 2026, increasing on a straight-
line basis to 100% of the award to vest if £400m of
inventory is monetized (in aggregate) in the same period.
This is contingent on the Remuneration Committee
deeming the inventory was monetised on acceptable
commercial terms.
The vesting for the 2022, 2023 and 2024 LTIP award will also
be subject to the ability of the Committee to reduce vesting
if it considers that appropriate having regard to financial, risk
and strategic performance.
When setting performance targets for the bonus and LTIP,
the Committee will take into account a number of different
reference points, which may include the Group’s business
plans and strategy, external forecasts and the wider
economic environment.
Flexibility, discretion and judgement
The Remuneration Committee operates the annual bonus
and LTIP according to the rules of each respective plan
which, consistent with market practice, include discretion in a
number of respects in relation to the operation of each plan.
Discretions include:
> who participates in the plan, the quantum of an award
and/or payment and the timing of awards and/or
payments
> determining the extent of vesting
> treatment of awards and/or payments on a change of
control or restructuring of the Group
> whether an Executive Director or a senior manager is a
good/bad leaver for incentive plan purposes and whether
the proportion of awards that vest do so at the time of
leaving or at the normal vesting date(s)
> how and whether an award may be adjusted in certain
circumstances (e.g. for a rights issue, a corporate
restructuring or for special dividends)
> what the weighting, measures and targets should be for
the annual bonus plan and LTIP awards from year to year
95 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Directors’ Remuneration Report
> the ability to apply malus and clawback provisions which
enable the Committee to recover or withhold value in the
event of certain defined circumstances
> the Committee also retains the ability, within the policy,
if events occur that cause it to determine that the
conditions set in relation to an annual bonus plan or a
granted LTIP award are no longer appropriate or unable
to fulfil their original intended purpose, to adjust targets
and/or set different measures or weightings for the
applicable annual bonus plan and LTIP awards. Any such
changes would be explained in the subsequent Directors’
Remuneration Report and, if appropriate, be the subject
of consultation with the Company’s major shareholders
and
> the ability to override formulaic outcomes in line with
Policy.
All assessments of performance are ultimately subject to the
Committee’s judgement. Any discretion exercised, and the
rationale, will be disclosed in the Annual Remuneration Report.
Legacy arrangements
For the avoidance of doubt, in approving this Directors’
Remuneration Policy, authority is given to the Company
to honour any previous commitments entered into with
current or former Directors (such as the payment of a
pension or the unwinding of legacy share awards granted
before the approval of this Policy) that remain outstanding.
While these details are included in the remuneration report
for transparency, it is not necessary to include them within
the remuneration policy or the various emoluments tables
as it does not comprise legal remuneration, However it is
accounted for as remuneration (see single total figure of
remuneration for each Director section).
Illustrations of application of remuneration policy
The chart below sets out for the Executive Directors an
illustration of the application of the Directors’ Remuneration
Policy set out above. The chart shows the split of
remuneration between fixed pay and LTIP on the basis
of minimum remuneration, remuneration receivable
for performance in line with the Group’s expectations,
maximum remuneration (not allowing for any share price
appreciation) and maximum remuneration (assuming 50%
share price growth).
As a 2024 bonus plan for Executive Directors has not yet
been approved the charts exclude any value relating to
annual bonus.
Remuneration
£600,000
£500,000
£400,000
£300,000
£200,000
£100,000
£0
£427,000
£272,000
48%
£531,000
58%
£220,000
100%
19%
81%
51%
42%
LTIP
Fixed pay
Minimum
On-target
Maximum
Maximum + 50% growth
Chief Executive O cer – Alessandro Zamboni
96 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
In illustrating the potential reward, the following assumptions have been made.
Fixed Pay
LTIP (normal policy level)
Minimum performance
Performance in line with
expectations
Maximum performance
Fixed elements of remuneration only,
being:
> base salary (being the salary to be
paid in FY 2024)
> benefits paid in FY 2024 with an
assumed value of £1k
> pension contributions of 6% of salary.
Maximum performance plus
50% share price growth
No vesting.
25% of maximum award vesting
(equivalent to 25% of salary) for
achieving threshold performance.
100% of maximum award vesting
(equivalent to 100% of salary) for
achieving maximum performance.
100% of maximum award vesting
(equivalent to 100% of salary) for
achieving maximum performance plus
hypothetical share price growth of 50%.
Notes to the scenarios methodology: LTIP is measured at face value, i.e. no assumption for dividends or share price growth (other than in the fourth scenario).
Recruitment remuneration
The policy aims to facilitate the appointment of individuals of
sufficient calibre to lead the business, to execute the Group’s
strategy effectively and to promote the long-term success
of the Group for the benefit of shareholders and other
stakeholders. When appointing a new Executive Director, the
Committee seeks to ensure that arrangements are in the best
interests of the Group and not to pay more than is appropriate.
When hiring a new Executive Director, the Committee will
typically align the remuneration package with the above
Policy. The Committee may include other elements of pay
which it considers are appropriate; however, this discretion
is capped and is subject to the principles and the limits
referred to below.
> New Executive Directors will be offered a basic salary
in line with the Policy. This will take into consideration a
number of factors including, external market forces, the
expertise, experience and calibre of the individual and
current level of pay. Where the Committee has set the
salary of a new appointment at a discount to the market
level initially until proven, they may receive an uplift or
a series of planned increases to bring the salary to the
appropriate market position over time.
> For external and internal appointments, the Committee
may agree that the Company will meet appropriate
relocation and/or incidental expenses as appropriate.
> Annual bonus awards, LTIP awards and pension
contributions would not be in excess of the levels stated
in the Policy table above.
> Depending on the timing of the appointment, the
Committee may deem it appropriate to set different
annual bonus performance conditions for the first
performance year of appointment. An LTIP award can be
made following an appointment (assuming the Company
is not in a closed period).
> Where a position is filled internally, any ongoing remuneration
obligations or outstanding variable pay elements shall be
allowed to continue according to the original terms, adjusted
as relevant to take into account the appointment.
> In addition, the Committee may offer additional cash
and/or share-based buyout awards when it considers
these to be in the best interests of the Company (and
therefore shareholders) to take account of remuneration
given up at the individual’s former employer. Such awards
would represent a reasonable estimate of the value
foregone and would reflect, as far as possible, the delivery
mechanism, time horizons and whether performance
requirements are attached to that remuneration.
Shareholders will be informed of any such payments at
the time of appointment and/or in the next published
Annual Report. However, for the avoidance of doubt, the
value of buy-out awards is not capped.
> For the appointment of a new Chairman or Non-Executive
Director, the fee arrangement would be set in accordance
with the approved Policy.
Service contracts and letters of appointment
The Company’s policy is that Executive Directors should
normally be employed under rolling service contracts with
notice periods of up to 12 months (from each party). Further
details of the notice periods in respect of each Executive
Director are provided on page 106. All Non-Executive Directors
have letters of appointment which may be terminated by the
giving of notice by either party (see page 106 for details of
current notice periods). Chairman and Non-Executive Director
appointments are subject to Board approval and election by
shareholders at each annual general meeting.
Copies of Executive Directors’ service contracts and Non-Executive
Directors’ letters of appointment are available for inspection at the
Company’s registered office during normal hours of business.
97 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Directors’ Remuneration Report
Payments for loss of office
The principles on which the determination of payments for loss of office will be approached are set out below:
Policy
Payment in lieu
of notice
The Company may terminate a Director’s contract with immediate effect with or without cause by
making a payment in lieu of notice by monthly instalments of salary and benefits, with reductions
for any amounts received from providing services to others during this period.
There are no obligations to make payments beyond those disclosed elsewhere in this report.
Annual bonus
This will be at the discretion of the Committee on an individual basis and the decision as to whether
or not to award an annual bonus award in full or in part will be dependent on a number of factors,
including the circumstances of the individual’s departure and their contribution to the business
during the annual bonus period in question. Any annual bonus award amounts paid will be
prorated for time in service during the annual bonus period and will, subject to performance, be
paid at the usual time (although the Committee retains discretion to pay the annual bonus award
earlier in appropriate circumstances). Any bonus earned for the year of departure and, if relevant,
for the prior year may be paid wholly in cash at the discretion of the Committee.
On a change of control, annual bonuses will either continue for the full year or a pro-rata bonus
may be paid out to the time of completion.
Deferred
bonus awards
If a participant ceases employment for any reason (other than voluntary resignation or summary
dismissal, in which case the award will lapse), the award will ordinarily continue until the normal
vesting date. The Committee retains discretion to release awards when the participant leaves.
On a change of control, awards will generally vest on the date of a change of control, unless the
Committee permits (or requires) awards to roll over into equivalent shares in the acquirer.
LTIP
Any outstanding awards will ordinarily lapse, however in “good leaver” cases the default treatment is
that awards will vest subject to any performance conditions and time pro-ration and the holding
period will normally continue to apply. For added flexibility, the rules allow for the Committee to
decide not to prorate (or prorate to a different extent) if it decides it is appropriate to do so, and to
allow vesting to be triggered at the point of leaving by reference to performance to that date, rather
than waiting until the end of the performance period if the Committee so decides.
On a change of control, awards will generally vest on the date of a change of control, unless the
Committee permits (or requires) awards to roll over into equivalent shares in the acquirer. Any
vesting of awards will be subject to assessment of performance against any performance conditions
and will normally be pro-rated.
Buy-out
awards
Other
payments
Where a buy-out award is made under the Listing Rules then the leaver provisions would be
determined at the time of the award.
The Group may pay outplacement and professional legal fees incurred by Executives in finalising
their termination arrangements, where considered appropriate, and may pay any statutory
entitlements or settle compromise claims in connection with a termination of employment, where
considered in the best interests of the Company. Outstanding savings/shares under all-employee
share plans would be transferred in accordance with the terms of the plans.
Where the Committee retains discretion, it will be used to provide flexibility in certain situations, taking into account the
particular circumstances of the Director’s departure and performance.
98 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
External appointments
The Company recognises that its Executive Directors may
be invited to become Non-Executive Directors of other
companies and that such external appointments can
broaden a Director’s experience and knowledge to the
potential benefit of Supply@ME. Subject to approval by
the Board, Executive Directors are allowed to accept Non-
Executive appointments, provided that these appointments
are not likely to lead to conflicts of interest. The Committee
will consider its approach to the treatment of any fees
received by Executive Directors in respect of external Non-
Executive roles as they arise.
Annual Report on Remuneration
Role and composition of the Remuneration Committee
The Board is ultimately accountable for executive
remuneration and delegates this responsibility to the
Remuneration Committee. The Remuneration Committee
is responsible for developing and implementing a
remuneration policy that supports the Group’s strategy and
for determining the Executive Directors’ individual packages
and terms of service together with those of the other
members of the leadership team (including the Company
Secretary). When setting the remuneration terms for
Executive Directors, the Committee reviews and has regard
to workforce remuneration and related policies and takes
close account of the remuneration-related provisions of the
QCA Corporate Governance Code.
The Committee is formally constituted and operates on
written terms of reference, which are available on the
Company’s website at https://www.supplymecapital.com/
investors/governance.
During 2023 the Committee was comprised of Enrico
Camerinelli, David Bull, Albert Ganyushin and Andrew Thomas
prior to his stepping down from the Board on 16 March 2023.
On joining the Board on 16 March 2023 Alexandra Galligan
undertook the role of Chair of the Remuneration Committee.
The Committee met four times during the year ending 31
December 2023. Enrico, David and Albert attended all
meetings, Andrew attended two meetings prior to his
departure on 16 March 2023 and Alexandra has attended as
the Chair of the two meetings held since her appointment to
the Board on 16 March 2023.
By invitation of the Committee, meetings are also attended by the
CEO, CFO and CPO, who are consulted on matters discussed
by the Committee, unless those matters relate to their own
remuneration. Advice or information is also sought directly
from other employees where the Committee feels that such
additional contributions will assist the decision-making process.
In order to avoid any conflict of interest, remuneration
is managed through well-defined processes ensuring
no individual is involved in the decision-making process
related to their own remuneration. In particular, the
remuneration of Executive Directors is set and approved by
the Committee. The Chair and Executives are responsible
for the remuneration of the Non-Executive Directors and the
Non-Executives (excluding the Chair) and the Executives are
responsible for determining the Chair’s remuneration. None
of the Directors are involved in the determination of their
own remuneration arrangements.
The Committee is authorised to take such internal and external
advice as it considers appropriate in connection with carrying
out its duties, including the appointment of its own external
remuneration advisers. During the year, the Committee was
assisted in its work by FIT Remuneration Consultants LLP.
FIT was appointed in July 2021 and has continued to provide
advice in relation to general remuneration matters during
2023. Fees incurred by FIT in relation to advice provided to
the Committee during the year to 31 December 2023 were
£6,151.50 (excluding VAT), charged on a time/cost basis. FIT
is a member of the Remuneration Consultants Group and,
as such, voluntarily operates under the Code of Conduct in
relation to executive remuneration consulting in the UK. The
Committee is satisfied that the advice they received from FIT
was objective and independent.
The Committee considered the following main items during
the 2023 financial year:
> Review of the remuneration policy, including key
performance indicators
> Remuneration for incoming Non-Executive Director
> Review, approval and issuance of the second awards
under the Long Term Incentive Plan
> Consideration and review of shareholder feedback on Long
Term Incentive Plan performance conditions for 2023
> Design for proposed Executive and Leadership team
bonus plan and discussion on appropriate targets and
timing,. This will remain under review during FY2024
> Review of Board level salary considering external benchmark
> Consideration of employees salaries in light of current
market conditions and Board remuneration
> Preparations for Directors’ remuneration reporting in respect
of FY2022 and FY2023 and review of the Remuneration Policy
> Consideration of Executive Directors’ Strategic Priorities
> Review and update of Committee terms of reference
Since the end of the 2023 financial year, the Committee has:
> Considered and recommended the 2024 LTIP
performance conditions
> Reviewed and contributed to the publishing of this
Directors Remuneration Report
> Reviewed and considered Executive Directors KPIs
> Reviewed and updated the Remuneration Committee
Terms of Reference
99 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Directors’ Remuneration Report
The information that follows has been audited (where indicated) by the Company’s auditors, Crowe UK LLP.
Single total figure of remuneration for each Director (audited)
The table below reports the full-year total remuneration receivable by those Directors who performed qualifying services
during the year.
For the year ended 31 December 2023:
Base salary /
fees
£
Benefits1
£
Pension2
£
Annual
bonus3
£
Long Term
Incentives4
£
Total
£
Total
fixed
£
Total
variable
£
Executive Directors
Alessandro Zamboni
207,000
254
12,420
Tom James5
John Collis5
51,252
51,252
Non-Executive Directors
Albert Ganyushin
150,000
Andrew Thomas6
Enrico Camerinelli
David Bull
Alexandra Galligan7
6,269
30,000
40,000
31,846
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Total
567,619
254
12,420
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
219,674
219,674
51,252
51,252
51,252
51,252
150,000
150,000
6,269
6,269
30,000
30,000
40,000
40,000
31,846
31,846
580,2938
580,293
-
-
-
-
-
-
-
-
-
1 Non-salary benefits include the provision of life assurance.
2
3
4
The amount of the employer contribution is based on a fixed percentage of base salary, being 6% for the Chief Executive Officer only.
The Group did not operate a bonus scheme in 2023. Please see details of future intention in the Directors Remuneration Policy.
The CEO was awarded share options in the 2022 and 2023 LTIP awards. The other Executive Directors who were in role at the time of both the 2022 and
2023 LTIP award being made did not receive any share awards due to the separate earn out arrangements that they were a party to. During the year ended
31 December 2023 there were no share options that vested under the 2022 or 2023 LTIP award or any other share option awards.
Tom James and John Collis receive a proportion of their salary in USD. These amounts have been converted to GBP in the total above using the average
exchange rate of 1.23. Tom James and John Collis left the Board on 23 March 2023 and the amounts included in the table above include their salary and fees
to that date.
Andrew Thomas left the Board on 16 March 2023 and received fees to that date.
Alexandra Galligan joined the Board on 16 March 2023 and received fees from that date.
The aggregate emoluments (being salary/fees, bonuses, benefits and pension allowances) of all Directors for 2023 was £580,293 (2022:£857,617).
5
6
7
8
100 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
For the year ended 31 December 2022:
Base salary /
fees
£
Benefits1
£
Pension2
£
Annual
bonus3
£
Long Term
Incentives4
£
Total
£
Total
fixed
£
Total
variable
£
Executive Directors
Alessandro Zamboni
Tom James5
John Collis5
Non-Executive Directors
Albert Ganyushin6
Andrew Thomas7
Enrico Camerinelli
David Bull8
Jim Coyle9
Susanne Chishti10
207,000
222,083
222,083
75,577
15,115
30,000
34,912
26,731
11,538
156
12,420
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Total
845,040
156
12,420
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
219,566
219,566
222,083
222,083
222,083
222,083
75,577
75,577
15,115
15,115
30,000
30,000
34,912
34,912
26,731
26,731
11,538
11,538
- 857,61711
857,617
-
-
-
-
-
-
-
-
-
-
1 Non-salary benefits include the provision of life assurance.
2
3
4
The amount of employer contribution is based on a fixed percentage of base salary, being 6% for the Chief Executive Officer only.
The Group did not operate a bonus scheme in 2022. Please see details of future intention in the Directors Remuneration Policy.
The CEO was awarded share options in the 2022 LTIP award. The other Executive Directors were not included in the 2022 award due to existing earn out
arrangements. During the year ended 31 December 2022 there were no share options that vested under the 2022 LTIP award or any other share option
awards.
Tom James and John Collis receive a proportion of their salary in USD. These amounts have been converted to GBP in the total above using the average
exchange rate of 1.25.
Albert Ganyushin joined the Board on 30 June 2022 and received fees from that date, this figure does not include fee paid to him prior to joining the Board
5
6
of £12,500 (excluding VAT) for strategic advisory project.
Andrew Thomas joined the Board on 30 June 2022 and received fees from that date.
7
8 David Bull’s fee was increased from £30,000 per annum to £40,000 per annum on 22 July 2022 to recognise his role as Chair of the Audit Committee.
9
Jim Coyle stepped down from the Board on 4 March 2022 and received fees to that date.
10 Susanne Chishti stepped down from the Board on 14 April 2022 and received fees to that date.
11 The aggregate emoluments (being salary/fees, bonuses, benefits and pension allowances) of all Directors for 2022 was £857,617 (2021:£629,352).
While not remuneration for the purposes of this table, for
completeness, in addition to an initial consideration received
on completion of the acquisition of TradeFlow, Tom James
and John Collis, the TradeFlow directors, were entitled to
receive acquisition related earn-out payments determined
by reference to pre-determined revenue milestones of
TradeFlow and, separately, of its subsidiary company (Tijara
Pte. Limited). These milestones were to be calculated by
reference to the revenues achieved in each of the 2021,
2022 and 2023 financial years and are contingent on
employment to the relevant dates. The acquisition related
earn-out amounts were able to be paid in either cash or
shares at the Company’s discretion. As such, they fall into the
definition of shared based payments under IFRS.
Prior to the completion of the TradeFlow Restructuring on 30
June 2023, the acquisition related earn-out milestone targets
were only met in respect of the year ended 31 December
2021. The fair value of the related earn-out payments were
calculated to be £700,000 at the grant date, being the date
of completion of the acquisition, with this fair value being
spread over the period from grant to vesting date in the
consolidated financial statements. On the 19 July 2022,
the Company chose to equity settle the earn-out payment
that was due. This resulted in each of the two TradeFlow
directors, being Tom James and John Collis, each being
awarded 106,762,760 new ordinary shares on 19 July 2022.
101 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Directors’ Remuneration Report
Annual bonus for the year ending 31 December 2023
(audited)
The Company did not offer annual bonus for FY 2023.
LTIP awards with performance periods ending in the year
(audited)
There were no long-term incentive awards capable of
vesting in relation to performance during the year ending 31
December 2023.
LTIP awards granted in the year (audited)
On 19 May 2023 awards in the form of nominal-cost share
options (“Awards”) over 355,884,274 ordinary shares
of nominal value 0.002 pence each in the capital of the
Company (“Ordinary Shares”) were granted under the
Supply@ME Long Term Incentive Plan (the “LTIP”) to certain
of the Company’s executives and senior management.
The Awards granted include those made to the following
Director:
Name
Position
Number of
Ordinary Shares
under Award
Alessandro
Zamboni
Chief Executive
Officer;
Executive
Director
97,031,250
Pursuant to the terms of the LTIP the Awards will normally
become exercisable on 19 May 2026.
Awards may become exercisable subject to continued
employment and the achievement of performance
conditions relating to absolute Total Shareholder Return
measured (50%) and volume of inventory monetised (50%).
Each performance condition will be measured over a
three-year performance period comprising the 2023, 2024
and 2025 financial years. In addition, the Remuneration
Committee will have broad discretion to reduce vesting if
it considers the level of vesting to be inappropriate having
regard to affordability, risk management and other factors.
The Award granted is subject to a two-year post-vesting
holding period following the vesting date.
Payments for loss of office and to past Directors (audited)
No such payments were made during the year.
102 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Statement of Directors’ shareholding and share interests (audited)
The following table shows the interests of Directors and their connected persons in the Company’s ordinary shares as at 31
December 2023.
Director1
Number of
shares owned
outright (including
connected persons)
Share awards
not subject to
performance
conditions
Share awards
subject to
performance
conditions
Shareholding
as a multiple
of salary at 31
December 20232
Shareholding
guideline as a
multiple of salary3
Shareholding
guideline met?
Alessandro Zamboni4
14,694,038,529
Tom James
John Collis
-
-
Albert Ganyushin
5,000,000
Andrew Thomas
Enrico Camerinelli
David Bull
-
-
-
Alexandra Galligan
2,493,333
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
46.14
-
-
0.02
-
-
-
0.04
2.0
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Yes
N/A
N/A
N/A
N/A
N/A
N/A
N/A
1
2
The shareholdings and awards set out above include those held by Directors and their respective connected persons.
Alessandro Zamboni’s shares are held through the AvantGarde Group. In connection with the TradeFlow Restructuring which completed on 30 June 2023,
TAG assumed the obligation of Tom James and John Collis, as the buyers of the 81% of TradeFlow, to pay £2,000,000 to the Company. In consideration for
assuming the £2,000,000 obligation, TAG acquired a total of 1,026,525,520 existing ordinary shares of nominal value £0.00002 each in the capital of the
Company from Tom James and John Collis.
The shareholding as a multiple of salary has been calculated using the value of the shareholding held at 31 December 2023 compared to the full year salary
for the year ended 31 December 2023.
The shareholding guideline as a multiple of salary is only applicable to Executive Directors and not to Non Executive Directors. Tom James and John Collis
3
4
resigned as Directors on 23 March 2023 and as such this guideline no longer applies to them as at 31 December 2023.
As announced on 4 April 2024, the number of shares of the Company held by the CEO, through the AvantGarde Group S.p.A
increased by 1,500,000,000 to a total of 16,194,038,529. There have been no other changes between 31 December 2023 and
19 April 2024, being the latest practicable date prior to the publication of this report.
Executive Directors Long term incentive (share) plan interests
Executive Director
Date of Grant
Vesting date
Holding period ends
No of shares
granted
Grant Price
Face value
(no of shares
x grant price)
Alessandro Zamboni 31 October 2022 31 October 2025 31 October 2027
258,750,000
0.8p
£207,000
19 May 2023
19 May 2026
19 May 2028
97,031,250
0.107p
£103,500
Tom James5
John Collis5
-
-
-
-
-
-
-
-
-
-
-
-
5
Tom James and John Collis resigned as Directors on 23 March 2023.
103 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Directors’ Remuneration Report
Total shareholder return performance graph
The graph below shows the value at 31 December 2023
of £100 invested in the Company on 23 March 2020 (i.e.
the date that Admission to trading on the London Stock
Exchange) compared to the value of £100 invested in the
FTSE SmallCap Index (excluding Investment Trusts), making
the assumption that dividends are reinvested to purchase
additional equity. The FTSE SmallCap Index (excluding
Investment Trusts) has been selected as a comparator index
to the Company, being made up of companies with a similar
market capitalisation to the Company.
n
r
u
t
e
R
r
e
d
o
h
e
r
a
h
S
l
l
a
t
o
T
200
) 300
0
2
0
2
h
c
r
a
M
3
2
t
a
0
0
1
o
t
d
e
s
a
b
e
r
(
100
0
Mar 2020
Dec 2020
Dec 2021
Dec 2022
Dec 2023
Supply Me Capital FTSE Small Cap Ex.Inv Trusts Source: Datastream (a Refinitiv product)
Chief Executive Officer’s remuneration
The total remuneration figure for the Chief Executive Officer in 2023 is shown in the table below, along with the value of
bonuses paid, and LTIP vesting, as a percentage of the maximum opportunity. This table will build up to show ten years’ worth
of data over time.
Year
2023
2022
2021
2020
CEO
Alessandro Zamboni
Alessandro Zamboni
Alessandro Zamboni
Alessandro Zamboni
CEO single figure of
total remuneration
£
Annual
bonus pay-out
% of maximum
LTIP vesting
% of maximum
219,674
219,576
234,376
138,750
-
-
-
-
-
-
-
-
104 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Annual percentage change in remuneration of Directors
and employees
The table below shows the percentage change in
remuneration of the Directors and employees of the
business between the 2022 and 2023 financial years.
% Change from FY2022 to FY2023
Salary or fees
Benefits
Bonus
Relative importance of spend on pay
The table below details the change in total staff pay
between 2022 and 2023 as detailed in note 8 to the
Group consolidated financial statements, compared with
distributions to shareholders by way of dividend, share buy
backs on any other significant distributions or payments.
These figures have been calculated in line with those in the
audited financial statements:
Employees1
Executive Directors2
Alessandro Zamboni
Tom James3
John Collis3
Non-Executive Directors2
Albert Ganyushin4
Andrew Thomas5
Enrico Camerinelli
David Bull6
Alexandra Galligan7
Jim Coyle8
Susanne Chishti8
0
0
(77)
(77)
98
(59)
-
15
100
(100)
(100)
33
N/A
2023 (£000) 2022 (£000) % Change
Total gross staff pay
2,198
2,767
(21)%
Dividends / share buybacks
-
-
N/A
The total gross staff pay for 2023 set out above includes the
gross staff pay for TradeFlow for the period from 1 January
2023 to 30 June 2023, compared to for 2022 where the total
gross staff pay includes a full year of TradeFlow gross staff
pay. This reflects the fact that the TradeFlow Restructuring
was finalised and completed on 30 June 2023 and TradeFlow
was deconsolidated from the Group’s financial results from
this date. The total gross staff pay excluding TradeFlow
reduced by 10% in 2023 compared to 2022.
63
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
1
The % change from FY2022 to FY2023 of the employees salary is
calculated using the mean annualised FTE salaries of the Supply@ME
Capital Plc employee base. The % change from FY2022 to FY2023 of the
employee benefits is calculated using the gross costs of these benefits to
2
3
4
the Company.
In order to illustrate the % change of the Directors from FY2022 to
FY2023 the actual amount paid as salary and fees during the period
served as a Director has been used.
Tom James and John Collis both resigned from the Board on 23 March
2023 and received fees to this date during FY23, compared to for a full
year during FY22.
Albert Ganyushin joined the Board during FY22 and therefore the
increase in his salary reflects the full year impact of his salary in FY23,
compared to the prior year when fees were received from his date of
joining the Board which was 30 June 2022.
Andrew Thomas joined the Board on 30 June 2022 and resigned from
5
the Board on 16 March 2023. The reduction in his salary reflects the
shorter time period he was a member of the Board in FY23.
6 David Bull’s fee was increased from £30,000 per annum to £40,000 per
annum on 22 July 2022 to recognise his role as the Chair of the Audit
Committee.
Alexandra Galligan joined the Board on the 16 March 2023 and therefore
had no comparative salary received in FY22
Jim Coyle and Susanne Chishti resigned during 2022, so no comparative
7
8
salary during 2023.
105 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Directors’ Remuneration Report
Summary of Shareholder Voting
The following table shows the results of the advisory vote on the 2022 Directors’ Remuneration Report and the binding vote
on the Directors’ Remuneration Policy at the 2023 Annual General Meeting:
Approval of the 2022 Directors’ Remuneration Report (2023 AGM)
Approval of the Remuneration Policy (2023 AGM)
Total number of votes
% of votes cast
Total number of votes
% of votes cast
For (including discretionary)
2,629,954,150
99.31%
2,628,985,769
Against
Votes withheld
18,232,816
2,126,668
0.69%
19,034,860
-
2,293,005
99.28%
0.72%
-
Executive Directors’ service contracts
The table below summarises key details in respect of the
current Executive Directors’ contracts:
Implementation of policy for the year ending 31
December 2024
Date of service
contract/ letter of
appointment
Notice period
(from either party
unless stated
otherwise)
Basic salary
Executive Directors’ salaries for FY 2024 are as follows:
Base salary FY2024
Director fees FY2024
Alessandro Zamboni
23 March 2020
12 months
Alessandro Zamboni
£207,000
-
The service contracts of all current Executive Directors are
available for inspection at the Company’s registered office.
Non-Executive Directors’ letters of appointment
The table below summarises key details in respect of the
Non-Executive Directors’ contracts:
Date of letter of
appointment
Notice period
(from either party)
Enrico Camerinelli
23 March 2020
3 months
David Bull
21 July 2021
Albert Ganyushin
30 June 2022
Alexandra Galligan
16 March 2023
90 days
90 days
90 days
External appointments
Alessandro Zamboni is a Non-Executive Director with
Darwinsurance srl and Non-Executive Director for RegTech
Open Project Plc.
The Committee reviewed Executive Directors salaries during
2023 and although current total remuneration levels are
below market no increases are currently proposed for FY
2024. The Committee intends to keep them under review
with a view to increasing total remuneration toward market
levels once the performance of the business warrants it.
Benefits and pension
The CEO receives a pension contribution or allowance of 6%
of base salary.
Annual bonus
A bonus plan has not yet been approved for 2024. The
Remuneration Committee will consider this prudently during
2024 in light of revenue and cash flow. If significant progress
is made on the Group’s key financial targets a variable pay
pool would be formed based on a combination of profit
and satisfaction of strategic and personal objectives. These
objectives will be linked to the Group’s strategy and aligned
with key financial, strategic and/or individual targets and be
governed by the Remuneration Policy.
106 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
LTIP
Executive Directors are eligible to participate in the LTIP. An
award is anticipated to be made during FY 2024 to the CEO
over shares up to 100% of base salary. The performance
conditions will be:
> 50% of the award to be based on absolute TSR over 3
financial years, requiring (assuming no dividends) the
average closing share price over the period 1 October
2026 – 31 December 2026 to be 0.15 for 25% of the
award to vest increasing on a straight-line basis to 0.3 for
100% to vest.
> 50% of the award to be based on volume of inventory
monetised by the end of the performance period (31
December 2026). 25% of award to vest if £300m of
inventory is monetized (in aggregate) over the 3 financial
years ending 31 December 2026, increasing on a straight-
line basis to 100% of the award to vest if £400m of
inventory is monetized (in aggregate) in the same period.
This is contingent on the Remuneration Committee
deeming the inventory was monetised on acceptable
commercial terms.
The Committee will have broad discretion to reduce vesting
if it considers the level of vesting to be inappropriate having
regard to affordability, risk management and other factors.
Non-Executive Directors’ fees
Non-Executive Directors’ fees for FY2024 will remain the
same as during 2023. This will however be reviewed during
the year in light of business progress and market conditions.
The Non-Executive Directors fees are detailed below:
Chairman
Base Non-Executive Director fee
Senior Independent Director fee
Fee FY2023
£
150,000
30,000
10,000
Chair of Audit or Remuneration Committee fee
10,000
107 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Report of the Directors
Report of the Directors
Review of Business and Future Developments
The Directors present their report on the Group together
with the audited consolidated financial statements for the
year ended 31 December 2023.
Results and dividends
The Group’s consolidated loss before taxation for the
year was £4,345,000 (2022: £9,878,000). The Group’s
consolidated operating loss from continuing operations
before impairment charges and fair value adjustments
for the year was £3,625,000 (2022: £4,651,000). More
information about the Group’s financial performance can
be found in the financial review on pages 38–45 and in the
financial statements on pages 115–195.
The Directors are not proposing a final dividend for the year
ended 31 December 2023. Which was the same in year
ended 31 December 2022.
Disclosure
Capital Structure
The Chief Executive Officer’s Statement on page 7 and
the Strategic Report on pages 3–60 provide a review of
the business, the Group’s trading for the year ended 31
December 2023, key performance indicators and an
indication of future developments and risks, form part of this
Directors’ Report.
Matters covered in the Strategic Report
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 Chief Executive’s Officer’s Statement and the Strategic
Report. These reports can be found in the relevant sections
above and should be read in conjunction with this report.
The review of the business and its future development in
the Strategic Report has been prepared solely to provide
additional information to shareholders to assess the Group’s
strategy and the potential for this strategy to succeed
Location
Notes 15, 17 and 22 to the consolidated Financial
Statements – pages 149, 152, 155
Directors’ interests
Directors’ Remuneration Report – pages 85–107
Directors’ Remuneration Report
Corporate Governance Report – pages 85–107
Directors’ responsibility statement
Page 114
Engaging with our stakeholders
Strategic Report – pages 36–37
Environmental Impact
Strategic Report, Environmental Impact – page 46
Exposure to price risk, credit risk, liquidity risk and cash flow risk Details can be found on pages 50–60 of the Strategic
Report and Note 22 to the consolidated Financial
Statements on page 155
Financial risk management objectives and policies (including
hedging policy and use of financial instruments)
Notes 2 and 22 to the consolidated Financial Statements
– pages 127, 155
Future business developments
Greenhouse gas emissions
Strategic Report – pages 3–28
Strategic Report, Environmental Impact – pages 46–49
People, culture and employee engagement
Strategic Report – pages 29–36
Principal decisions made by the Board during the year
Strategic Report – pages 69–70
TCFD Statement
Section 172 Statement
Strategic Report - pages 48–49
Strategic Report – pages 36–37
The stakeholder engagement section of the strategic
report contains information in respect of the Group’s key
stakeholders and business relationships, including our
people, shareholders, corporate clients, inventory funders,
fund investors and White-Label clients.
108 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Cautionary statement
The review of the business and its future development in
the Strategic Report has been prepared solely to provide
additional information to shareholders to assess the Group’s
strategy and the potential for this strategy to succeed. It
should not be relied on by any other party for any other
purpose. The review contains forward-looking statements
which are made by the Directors in good faith based on
information available to them up to the time of the approval
of the reports and should be treated with caution due to the
inherent uncertainties associated with such statements.
Directors of the Group
> Alessandro Zamboni – Chief Executive Officer and
Executive Director (appointed 23 March 2020)
> Enrico Camerinelli – Independent Non-Executive Director
(appointed 23 March 2020)
> David Bull – Independent Non-Executive Director
(appointed 22 July 2021)
> Alexandra Galligan - Independent Non-Executive Director
(appointed 16 March 2023)
> John Collis – Former Executive Director (appointed 30 July
2021, resigned 23 March 2023)
> Thomas James – Former Executive Director (appointed 30
July 2021, resigned 23 March 2023)
> Andrew Thomas – Former Non-Executive Director
(appointed 30 June 2022, resigned 15 March 2023)
The Directors, who held office during the period, and
subsequently, together with current Directors are as follows:
> Albert Ganyushin – Independent Chairperson and Non-
The biographies of the Directors in office as at the date
of this Annual Report are set out on pages 63–67 of the
Corporate Governance Report.
Executive Director (appointed 30 June 2022)
Directors’ interests
The Directors who held office during the year and their interests in the ordinary shares of the Company were as follows:
Alessandro Zamboni (held through AvantGarde Group SpA and 1AF2 Limited)
14,694,038,529
12,742,513,009
Ordinary Shares
(At 31 December 2023)
Ordinary shares
(At 31 December 2022)
Albert Ganyushin
Alexandra Galligan
Enrico Camerinelli
David Bull
John Collis
Thomas James
Andrew Thomas
5,000,000
2,493,333
Nil
Nil
Nil
Nil
Nil
Nil
N/A
Nil
Nil
513,262,760
513,262,760
Nil
In connection with the TradeFlow Restructuring which
completed on 30 June 2023, TAG assumed the obligation
of Tom James and John Collis, as the buyers of the 81%
of TradeFlow, to pay £2,000,000 to the Company. In
consideration for assuming the £2,000,000 obligation, TAG
acquired a total of 1,026,525,520 existing ordinary shares of
nominal value £0.00002 each in the capital of the Company
from Tom James and John Collis.
On the 26 March 2024, the Company and TAG entered into
an agreement, which allowed the full outstanding amount of
£800,000 owed by the Company to TAG, under amended TAG
Unsecured Working Capital facility, to be extinguished by the issue
of 1,500,000,000 new ordinary shares which were issued to TAG
on 28 March 2024. Following this issue of new ordinary shares
to TAG on the 28 March 2024, the number of ordinary shares
held by Alessandro Zamboni increased to 16,194,038,529
The Powers of the Company Directors
The powers of the Directors are set out in the Company’s
articles of association (the Articles) and the Companies
Act 2006 and are subject to any directions given by
special resolution. The Directors are responsible for the
management of the Company’s business, for which purpose
they may exercise all the powers of the Company whether
relating to the management of the business or not. The
Directors may also, subject to the Articles, delegate any of
their powers, authorities and discretions as they see fit. The
Board is required by the Articles to consist of no fewer than
two Directors and is not subject to any maximum number.
109 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Report of the Directors
Appointment and replacement of Directors
IAS
The rules governing the appointment and replacement of
Directors are set out in the Articles and are governed by the
QCA Code, the Companies Act 2006 and related legislation.
Directors may be appointed by ordinary resolution of the
shareholders or by the Board. At each AGM, all Directors
who have been appointed by the Board since the
previous AGM shall offer themselves for re-election by the
shareholders. In addition, any Directors for whom the AGM
is their third since they were last elected or re-elected, shall
offer themselves for re-election by the shareholders. As
such at the Company’s next AGM, a date for which will be
announced shortly following the publication of this Annual
Report. Enrico Camerinelli will be the only Director who will
offer themself for re-election.
Articles of Association
The rules governing the appointment and replacement
of Directors are set out in the Company’s Articles of
Association. The Articles of Association may be amended by
a special resolution of the Company’s shareholders.
Compensation for loss of Office
No compensation for loss of office was paid to Directors who
resigned during the year or in the period following the year
end and up to the date at which this Annual Report has been
published.
Corporate governance statement
The Directors have prepared the Group consolidated
financial statements in accordance with UK-adopted
International Accounting Standards.
Political and charitable donations
No political or charitable donations were made by the Group
during the period (2022: £nil).
Research and Development
During the year the Group continued to invest in the
development of its core Inventory Monetisation Platform,
the purpose of which is to facilitate, record and monitor
Inventory Monetisation transactions between third party
client companies and segregated independent trading
companies (known as stock companies). The internally
generated Inventory Monetisation Platform includes not only
the software but also:
> the methodologies and business policies underpinning
each Inventory Monetisation transaction.
> the legal and accounting frameworks required to support
each Inventory Monetisation transaction.
> the technical infrastructure (cloud environment,
distributed ledger technology) used to support each
Inventory Monetisation transaction.
During the year the Group capitalised costs associated with
the development of the Inventory Monetisation Platform
to the value of £458,000 (2022: £1,125,000) as disclosed in
note 12 to the Group’s consolidated financial statements.
The Corporate Governance Report set out on pages 61–114
forms part of the Directors’ Report.
Authority for Company to Purchase own Shares.
Directors’ and officers’ liability insurance
Throughout the financial year the Company had, as
permitted by sections 234 and 235 of the Companies Act
2006, maintained Directors’ and Officers’ Liability insurance
cover on behalf of the Directors of the Company. These
policies indemnify them against certain liabilities which may
be incurred by them in relation to the Company.
Subject to authorisation by shareholder resolution, the
Company may purchase its own shares in accordance with
the Companies Act 2006. Any shares which have been
bought back may be held as treasury shares or cancelled
immediately upon completion of the purchase. Since listing
the Directors have not exercised any of their powers to
purchase its own shares.
Financial Instruments
The financial risk management objectives and policies of the
Group are shown in note 22 to the Group’s consolidated
financial statements.
110 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Significant Interests (greater than 3%)
The table below shows the interests in shares notified to the Company in accordance with the Disclosure Guidance and
Transparency Rules as of 31 December 2023, and 19 April 2024 (being the latest practicable date prior to publication of the
Annual Report):
Name of Shareholder
Alessandro Zamboni (held through
As of 31 December 2023
As at 19 April 2024
No. of ordinary shares
held of £0.00002
nominal value each
% of total
voting rights held
No. of ordinary shares
held of £0.00002
nominal value each
% of total
voting rights held
AvantGarde Group SpA and 1AF2 Limited)
14,694,038,529
24.00%
16,194,038,529
Venus Capital S.A
9,150,000,000
14.94%
9,150,000,000
Hartfort Growth Fund Limited
1,955,392,026
3.19%
1,792,792,026
25.81%
14.59%
2.86%
Except as disclosed in the above table, the Company and
the Directors are not aware of any person who, directly or
indirectly, has a holding which is notifiable under English law
or who directly or indirectly, jointly or severally, exercises
or could exercise control over it, nor are they aware of any
arrangements the operation of which may at a subsequent
date result in a change of control over it. Those interested,
directly or indirectly, in 3% or more of the issued ordinary
shares (as set out in the above table) do not have different
voting rights from other shareholders.
Branches outside of the UK
The Group has subsidiaries outside the UK in Italy. Further
details of these can be found in note 3 to the Company’s
financial statements. The Company currently does not have
any branches outside of the UK.
Change of Control
The Group is party to a limited number of funding
agreements that include change of control provisions which,
in the event of a change of control of the Company, or the
relevant Group entity, could result in the termination of
those arrangements at the election of the lender, which
if triggered would result in the discontinuation of further
funding and a requirement to repay amounts outstanding
under the affected arrangement.
Going concern
In carrying out their duties in respect of going concern, the
Directors have completed a review of the Group’s financial
forecasts for a period exceeding 12 months from the date
of issue of this annual report. This review included sensitivity
analysis focused on the more immediate going concern period
to determine the potential impact on the Group of reasonably
possible downside scenarios. For the reasons set out below,
the Directors consider that it is appropriate to adopt the going
concern basis in preparing the financial statements of the
Group for the year ended 31 December 2023.
At the 31 December 2023 the Group had a cash and cash
equivalent balance from continuing operations of £5,000 (31
December 2022: £257,000 cash and cash equivalents from
continuing operations, £324,000 cash and cash equivalents
from discontinued operations). The Group’s consolidated
net current liabilities of £2,691,000 as at 31 December 2023,
compared to a consolidated net current liability position of
£828,000 as at 31 December 2022. The Group has posted a
total comprehensive loss for the year ended 31 December 2023
of £4,041,000 (2022: total comprehensive loss £10,417,000) and
the retained losses were £32,113,000 as at 31 December 2023
(31 December 2022: retained losses £27,649,000).
Funding secured during 2023
During the year ended 31 December 2023, the Group
continued to source additional funding with the primary aim
of allowing it to meet its working capital and growth needs
as it focuses on scaling up the Group’s business model
and the continued investment into the Group’s Platform. In
sourcing this new funding, the focus has been on creating
a more stable source of Group funding. These new sources
of funding were announced in conjunction with the issue of
the 2022 Annual Report on 28 April 2023 and the interim
results for the six month period ended 30 June 2023 on 29
September 2023. These new sources of funding included:
> the subscription agreement with Venus Capital dated 28 April
2023 for the issue of the 4,500,000,000 new ordinary shares
(the “Subscription Shares”) at £0.0005 per Subscription Share
(the “Subscription Agreement”). The issue of the Subscription
Shares raised gross proceeds of £2,250,000 during the first six
months of the year (the “2023 Venus Subscription”);
> the fixed term unsecured working capital loan
agreement with The AvantGarde Group S.p.A (“TAG”),
the Group’s major shareholder, dated 28 April 2023
(the “TAG Unsecured Working Capital facility”), which
was then amended on 30 June 2023 in conjunction
111 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Report of the Directors
with the finalisation of the disposal of the 81% stake in
ownership of TradeFlow Capital Management Pte. Limited
(“TradeFlow”) (the “TradeFlow Restructuring”). On 30 June
2023, the Company issued a draw down notice to TAG
under the amended TAG Unsecured Working Facility for
the full £800,000 of funding available under this facility. As
at 31 December 2023, £250,000 had been received from
TAG in respect of this facility. As set out in note 30 to the
Group’s consolidated financial statements, subsequent
to 31 December 2023, and prior to the issue of these
financial statements, the remaining £550,000 had been
received from TAG. Additionally on 26 March 2024, the
Company and TAG signed a second deed of amendment
agreement, which allowed the full outstanding amount
of the amended TAG Unsecured Working Capital facility
to be extinguished by the issue of 1,500,000,000 new
ordinary shares issued to TAG on 28 March 2024; and
> the top up unsecured shareholder loan agreement
with TAG, dated 28 September 2023 (“TAG Top-Up
Shareholder Loan Agreement”), details of which are set
out below:
a) The ability of the Company to draw down up to £3.5
million in monthly instalments over the period to 30
June 2025;
b) On a monthly basis the Board will assess (acting in
good faith and in its sole and absolute discretion)
if the Group’s projected cash balance on the last
business day of the coming calendar month will be
less than £250,000 following the Group’s scheduled
balance of receipts and payments for the next month
by reference to, inter alia, the Group’s contracted
receivables, revenues and payables due for receipt or
payment in the next month, the Group’s contracted
fixed operating expenditure and/or capital expenditure
due for payment in the next month, the cash inflows
in the next month arising from any warrants that
have been contractually exercised and any projected
unrestricted cash amounts resulting from any
contractually agreed alternative equity, debt or hybrid
financing (including, but not limited to, pursuant to a
pre-emptive offering of ordinary shares and a non-pre-
emptive offering of ordinary shares) for such month;
c) If the above assessment results in the Group’s
projected cash balance on the last business day of
the coming calendar month being less than £250,000,
the Company may draw down an amount under the
TAG Top-Up Shareholder Loan Agreement which is
no greater than the GBP amount to ensure that the
Group’s bank balances in the coming month shall be
equal to £250,000;
d) Repayment of any sum drawn down under the TAG Top-
Up Shareholder Loan Agreement will be due five calendar
years (calculated on the basis of a year of 360 days) from
the date which funds are received by the Company
subject to the relevant draw down request; and
e) Any sums drawn down by the Company under the
TAG Top Up Unsecured Shareholder Loan will attract
a non-compounding interest rate of 10% per annum,
and any principal amount (excluding accrued interest)
outstanding on a relevant due date shall attract a
compounding rate of 15% per annum thereafter.
Interest will be due to be paid annually on 31 March of
each relevant calendar year.
As at 31 December 2023, the Company had issued draw
down notices to TAG for a total amount of £969,000 under
the Top-Up Shareholder Loan Agreement, however the full
amount of this draw down was outstanding. As set out in
note 30 to the Group’s consolidated financial statements,
subsequent to 31 December 2023, and prior to the issue of
these financial statements, the Company issued additional
draw down notices under the Top-Up Shareholder Loan
Agreement to the value of £779,000 and had received £nil
from TAG in respect of this facility.
In addition to the new sources of funding securing during
2023, which have been highlighted above, the Company
completed the TradeFlow Restructuring on 30 June 2023 and
the remaining cash proceeds that were due from the buyers
of TradeFlow (the “Buyers”) as a result of this transaction
was £2,000,000. TAG assumed this £2,000,000 obligation of
the Buyers by way of a deed of novation also signed on 30
June 2023 (“Deed of Novation”) and in exchange received
consideration TAG acquired 1,026,525,520 existing ordinary
shares of nominal value £0.00002 each in the capital of
the Company from the Buyers. This £2,000,000 was due in
tranches and the final tranche was due to be payable by 31
January 2024.
As at 31 December 2023, £1,228,000 of the £2,000,000
due under the Deed of Novation had been repaid by TAG
to the Company. The payment had been received through
a split of £771,000 in cash, £421,000 by way of formal debt
novation agreements with specific suppliers whereby the
debt held by the Group companies was novated to TAG with
no recourse to the Group companies, and £36,000 by way
of offset against amounts owed by the Group companies
to TAG. The Company is now charging a late fee to TAG
calculated at a compounding rate of 15% per annum on any
amounts of the instalments not transferred to the Company
by the relevant due date. As set out in note 30 to the
Group’s consolidated financial statements, subsequent to
31 December 2023, and prior to the issue of these financial
statements £655,000 of the £772,000 outstanding at 31
December 2023 was repaid through the combination of
cash payments and the offsetting of amounts due to TAG
from SYME, leaving a remaining balance of £117,000.
Taking into consideration the factors above and in order to
consider their assessment of the Group as a going concern,
112 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
the Directors have reviewed the forecast cash flows for the
next 12 months from approval of the Group’s consolidated
financial statements for the year ended 31 December 2023.
The cash flow forecasts take into account that the Group
meets its day to day working capital requirements through
its forecast available and committed cash resources. The
Directors have prepared the forecast using their best
estimates, information and judgement at this time, including
the receipt of cash that is contractually committed under the
TAG Top-Up Shareholder Loan Agreement. The Directors
have also considered the expected cash flows arising from the
use of the Group’s innovative Platform to facilitate Inventory
Monetisation transactions. This reflects the business progress
that has been made to date and the fact that the Directors
expect the Group to continue to prove the concept of its
business model and to fully operationalise in the near future
following the progress steps that have made to date.
Despite the facts outlined above, there continues to be an
absence of a historical recurring track record relating to
multiple Inventory Monetisation transactions being facilitated
by the Group’s Platform and the Group being cash flow
positive. As such the Directors have prudently identified
uncertainty in the cash flow model. This uncertainty arises
with respect to both the future timing and growth rates of the
forecast cash flows arising from the Group’s multiple Inventory
Monetisation revenue streams. In this regard, if these future
revenues are not secured as the Directors envisage, it is
possible that the Group will have a shortfall in cash and require
additional funding during the forecast period. In addition the
cash inflows arising from the TAG Top-Up Shareholder Loan
Agreement have not yet been fully received. These amounts
have been factored into the cash flow forecast in line with the
contractual commitments received from the counterparty and/
or the latest updates from TAG. As such, there is a risk that
these cash flows might not be received or might not reach
the Group in the time frame expected despite the contractual
commitment in place.
On the basis of the factors identified in the above paragraph,
the Directors believe there are material uncertainties
which may cast significant doubt upon the entities ability to
continue as a going concern.
The Directors do however remain confident in the business
model and believe the Group could be managed in a way to
allow it to meet its ongoing commitments and obligations
through mitigating actions including cost saving measures and
securing alternative sources of funding should this be required.
As such the Directors consider it appropriate to prepare
these annual consolidated financial statements on a going
concern basis and have not included the adjustments that
would result if the Company and Group were unable to
continue as a going concern.
Website publication
The Directors are responsible for ensuring that the Annual
Report and financial statements are made available on the
website. The 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 the requirements of UK-
adopted International Accounting Standards 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.
External Auditor
The auditor, Crowe U.K. LLP, will be proposed for re-
appointment at the forthcoming Annual General Meeting.
2024 AGM
The Notice of Annual General Meeting for 2024 will be
circulated to all the shareholders at least 21 clear days before
the AGM and it will also be made available on our corporate
website www.supplymecapital.com. The voting on the
resolutions will be announced via the Regulatory News Service.
113 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Report of the Directors
Post balance sheet events
Details of post events since the reporting date can be found
in note 30 to the Group’s consolidated financial statements.
Statement of Directors’ Responsibilities
The Directors are responsible for the maintenance and
integrity of the corporate and financial information included
on the Company’s website. Legislation in the United Kingdom
governing the preparation and dissemination of the financial
statements and other information included in the annual
reports may differ from legislation in other jurisdictions.
The Directors acknowledge their responsibilities for
preparing the Annual Report and the financial statements in
accordance with applicable law and regulations.
The Report of the Directors set out from page 108 to page
114 is approved by the Board of Directors and signed on its
behalf by:
Alessandro Zamboni
Chief Executive Officer and Executive Director
30 April 2024
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 UK-adopted International
Accounting Standards. 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 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 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.
114 Supply@ME Capital Plc Annual Report and Accounts 2023 Corporate Governance Report
Financial
Statements
Independent Auditor’s Report
to the members of Supply@ME Capital Plc
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
and the quantum and timing of financing transactions 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 Group’s and
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 group and
Company’s ability to continue to adopt the going concern
basis of accounting included:
> we reviewed and challenged the forecast revenues and
agreed, where possible, to underlying term sheets. The
resulting cash flows within the assessment period are
uncertain and this fact is disclosed in note 2;
> we challenged management over the forecast of cash
inflows from financing activities, the receipt of which the
going concern assumption is reliant on. We removed
these cashflows from the model to ascertain whether
they were material to the model. The reliance on the
model to these inflows and the uncertainty over the
quantum and timing are disclosed in note 2
> we tested the mathematical accuracy of the model;
> we reviewed forecast cost assumptions having regard to
historic experience and current trading levels; and
> we reviewed the appropriateness of the disclosure made
and its consistency with our review of the going concern
assessment.
Our responsibilities and the responsibilities of the directors
with respect to going concern are described in the relevant
sections of this report.
We have audited the financial statements of Supply@ME
Capital plc (the “Company”) and its subsidiaries (the “Group”)
for the year ended 31 December 2023 which comprise
the consolidated statement of comprehensive income, the
consolidated and company statement of financial position,
the consolidated and company statement of changes in
equity, the consolidated statement of cashflows and notes
to the financial statements, including significant accounting
policies. The financial reporting framework that has been
applied in the preparation of the group financial statements
is applicable law and UK-adopted international accounting
standards. 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 give a true and fair view of the
state of the Group’s and of the Company’s affairs as at 31
December 2023 and of the Group’s loss for the year then
ended;
> the Group financial statements have been properly
prepared in accordance with UK-adopted international
accounting standards;
> the parent company financial statements have been
properly prepared in accordance with United Kingdom
Generally Accepted Accounting Practice; and the
> the financial statements have been prepared in
accordance with the requirements of the Companies Act
2006.
Basis for opinion
We conducted our audit in accordance with International
Standards on Auditing (UK) (ISAs (UK)) and applicable law.
Our responsibilities under those standards are further
described in the Auditor’s responsibilities for the audit
of the financial statements section of our report. We are
independent of the group and 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 as applied to listed public interest entities, and we
have fulfilled our other ethical responsibilities in accordance
with these requirements. We believe that the audit evidence
we have obtained is sufficient and appropriate to provide a
basis for our opinion.
116 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
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
£208,000 (2022 £600,000), based on approximately 5% of
the loss before tax for the period. Materiality for the parent
company financial statements as a whole was set at £190,000
(2022: £310,000) based on 4% of its individual result.
Overview of the scope of our audit
As at 31 December 2023, the group consists of three
components, Supply@ME Capital plc, a holding company
based in London, United Kingdom and its trading subsidiaries,
Supply@ME Srl and Supply@ME Technologies Srl both based
in Italy. Supply@ME Capital plc was audited by us and
was conducted from the UK. Audit work on the significant
non-UK components being Supply@ME Srl, and Supply@
ME Technologies Srl were carried out by a member of the
Crowe Global International network as component auditor.
Limited procedures were performed by a member of the
Crowe Global International network on disclosures relating
to TradeFlow Capital Management Pte Ltd, which is based in
Singapore, a component which was disposed of in the year.
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 £124,800 (2022 £360,000) for the Group
and £114,000 (2022: £186,000) for the parent company.
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 £10,000 (2022: £7,200). Errors below that
threshold would also be reported to it if, in our opinion as
auditor, disclosure was required on qualitative grounds.
In establishing our overall approach to the Group audit, we
determined the type of work that needed to be undertaken
at each of the components by us, as the primary audit
engagement team. For the full scope components in
Italy and Singapore, where the work was performed by
component auditors, we determined the appropriate
level of involvement to enable us to ensure that sufficient
appropriate audit evidence had been obtained as a basis for
our opinion on the Group as a whole.
The primary team led by the Senior Statutory Auditor was
ultimately responsible for the scope and direction of the
audit process. The primary team, using technology, interacted
regularly with the component teams where appropriate
during various stages of the audit, reviewed working papers
and were responsible for the scope and direction of the
audit process. This, together with the additional procedures
performed at Group level, gave us appropriate evidence for
our opinion on the Group financial statements.
117 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Independent Auditor’s Report
to the members of Supply@ME Capital Plc
Key Audit Matters
Key audit matters are those matters that, in our professional
judgment, 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) we identified, including 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.
In addition to the matter described in the material
uncertainty relating to going concern above, we have
determined the matter described below to be the key audit
matter to be communicated in our report.
Key audit matter
How our scope addressed the key audit matter
Disposal of TradeFlow Capital Management Pte Ltd
As disclosed in note 26 to the financial statements, during
the year the group disposed of 81% of TradeFlow Capital
Management Pte Ltd. The conditions for Discontinued
operations were met and this has had a pervasive impact
across the primary financial statements and related notes.
In addition, linked to this transaction, the group was left
with a 19% residual interest that is accounted for at fair
value, which is inherently judgmental and the
consideration for the transaction was novated to The
AvanteGarde Group and was not settled by 31 December
2023.
Given the size and importance of the disposal of
TradeFlow Capital Management Pte Ltd and the additional
accounting considerations that arose this was a key area
of focus for our audit.
To assess the adequacy of the accounting for the
presentation as Assets held for sale and Discontinued
operations:
> We agreed the sale transaction to the signed share
purchase agreement, noting the key terms.
> We reviewed the disclosures having regard to the
requirements of IFRS 5
> We considered the criteria for significant influence to
exist which could impact the accounting for the residual
interest
> We challenged management’s calculation of the Fair
value of the residual interest at the disposal and
reporting date and a downward fair value adjustment
was recorded following our challenge
> We performed specified procedures on the result of
the entity prior to disposal and the assets and liabilities
at the disposal date
> We recalculated the associated gain on disposal,
including agreeing the consideration to the share
purchase agreement and agreeing the net assets
disposed to supporting documentation
> We assessed the recoverability of the consideration
receivable
Key observation
We concluded that the accounting for the sale of
TradeFlow Capital Management Pte Ltd was appropriate.
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.
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.
Our opinion on the financial statements does not cover the
other information and, except to the extent otherwise
We have nothing to report in this regard.
118 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Opinions on other matters prescribed by the
Companies Act 2006
intend to liquidate the Group or the parent company or to
cease operations, or have no realistic alternative but to do so.
In our opinion the part of the directors’ remuneration report
to be audited has been properly prepared in accordance
with the Companies Act 2006.
Auditor’s responsibilities for the audit of the financial
statements
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 year for which the
financial statements are prepared is consistent with the
financial statements; and
> the strategic report and the directors’ 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
Group and the Company and their 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 company 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
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:
> 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; the laws and regulations
we considered in this context were relevant company law
and taxation legislation
> examining supporting documents for all material
balances, transactions and disclosures;
> review of the Board of directors and the Audit Committee
minutes;
> enquiry of management about litigations and claims and
inspection of relevant correspondence;
> we have not received all the information and explanations
> evaluation of the selection and application of accounting
we require for our audit
Responsibilities of the directors for the financial
statements
As explained more fully in the directors’ responsibilities
statement on page 114, 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.
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;
> review of accounting estimates for biases; and
> Communications with component auditors to request
identification of any instances of non-compliance with
laws and regulations that could give rise to a material
misstatement of the group financial statements.
In preparing the financial statements, the directors are
responsible for assessing the Group’s and the parent
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
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
119 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Independent Auditor’s Report
to the members of Supply@ME Capital Plc
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 on 22 September
2020 to audit the financial statements for the period ending
31 December 2019. Our total uninterrupted period of
engagement is 5 years, covering the periods ending 31
December 2019 to 31 December 2023.
The non-audit services prohibited by the FRC’s Ethical
Standard were not provided to the group or the company
and we remain independent of the group and the company
in conducting our audit.
Our audit opinion is consistent with the additional report to
the Audit Committee.
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
30 April 2024
120 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Consolidated Statement of Comprehensive Income
for the Year Ended 31 December 2023
Continuing operations
Revenue
Cost of sales
Gross (loss)
Administrative expenses
Other operating income
Operating loss from continuing operations before impairment charges
and fair value adjustments
Fair value adjustments to investments
Impairment charges
Operating loss from continuing operations
Finance costs
Loss before tax from continuing operations
Income tax
Loss after tax from continuing operations
Discontinued operations
Loss from discontinued operations
Total loss for the year
Other comprehensive income
Items that may be subsequently reclassified to profit or loss
Exchange differences on translating foreign operations
Total comprehensive loss for the year
Loss attributable to:
Owners of the Company
Earnings/(loss) per share
Basic and diluted loss per share – continuing operations
Basic and diluted loss per share – discontinued operations
Basic and diluted loss per share – total
Year ended
31 December 2023
£ 000
Year ended
31 December 2022
£ 000
Note
3
6
5
3
27
6
4
10
26
11
11
11
158
(603)
(445)
(3,678)
498
(3,625)
(68)
(384)
(4,077)
(83)
(4,160)
-
(4,160)
(185)
(4,345)
304
(4,041)
(4,041)
Pence
(0.0070)
(0.0003)
(0.0073)
138
(338)
(200)
(4,460)
9
(4,651)
-
(1,078)
(5,729)
(1,982)
(7,711)
-
(7,711)
(2,167)
(9,878)
(539)
(10,417)
(10,417)
Pence
(0.0178)
(0.0050)
(0.0228)
The above consolidated statement of comprehensive income should be read in conjunction with the accompanying notes.
121 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Consolidated Statement of Financial Position
As at 31 December 2023
Non-current assets
Intangible assets and goodwill
Investment
Property, plant and equipment
Other non-current assets
Total non-current assets
Current assets
Trade and other receivables
Cash and cash equivalents
Receivable from related party
Assets of disposal group held for sale
Total current assets
Total assets
Current liabilities
Trade and other payables
Liabilities of disposal group held for sale
Total current liabilities
Net current liabilities
Non-current liabilities
Long-term borrowings
Provisions
Deferred tax liabilities
Total non-current liabilities
Net liabilities
Equity attributable to owners of the parent
Share capital
Share premium
Share-based payment reserve
Other reserves
Retained losses
Total equity
As at
31December 2023
£ 000
As at
31 December 2022
£ 000
Note
12
27
13
14
26
16
26
17
18
15
24
-
284
3
19
306
1,026
5
847
1,878
-
1,878
2,184
4,569
-
4,569
(2,691)
840
575
7
1,422
(3,807)
5,989
25,396
7,969
(11,048)
(32,113)
(3,807)
-
-
7
19
26
1,219
257
-
1,476
6,844
8,320
8,346
4,587
4,561
9,148
(828)
748
468
7
1,223
(2,025)
5,897
25,269
5,871
(11,413)
(27,649)
(2,025)
The above consolidated statement of financial position should be read in conjunction with the accompanying notes. The consolidated
financial statements on pages 121-176 were approved and authorised for issue by the Board on 30 April 2024 and signed on its behalf by:
Mr. Alessandro Zamboni
CEO and Executive Director
Mr. David Bull
Independent Non-Executive Director and Chair of Audit Committee
Supply@ME Capital plc - Registration number: 03936915
122 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Consolidated Statement of Changes in Equity
for the Year Ended 31 December 2022
Share
capital
£ 000
Share
premium
£ 000
Other
reserves*
£ 000
Note
Share-
based
payment
reserve
£ 000
Merger
reserve*
£ 000
Reverse
takeover
reserve*
£ 000
Foreign
currency
reserve*
£ 000
Retained
losses
£ 000
Total
£ 000
At 1 January 2022
Loss for the year
Forex retranslation difference
5,486 18,171
21
2,018 226,905(237,834)
18 (16,209)
(1,425)
-
-
-
-
-
-
-
-
-
-
-
-
-
(9,878)
(9,878)
(539)
-
(539)
5,486 18,171
21
2,018 226,905(237,834)
(521)
(26,087)
(11,841)
Issuance of new shares
15
406 10,396
Costs incurred in connection with the
issuance of new ordinary shares
Credit to equity for issue of
warrants
Exercise of Open Offer Warrants
Credit to equity for prior year
acquisition related earn-out
payments
24
15
Settlement of prior year acquisition
related earn-out payments
15
Debit to equity for current year
and future acquisition related
earn-out payments
Equity settled employee share-
based payment schemes
Pension plan actuarial gain or loss
Subsidiaries disposed of during
the year
-
-
1
-
4
-
-
-
-
(4,024)
-
31
-
695
-
-
-
-
-
-
-
-
-
-
-
-
16
-
-
-
5,292
(40)
172
(699)
(883)
11
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
- 10,802
(1,605)
(5,629)
-
5,292
40
32
-
-
-
-
-
3
172
-
(883)
11
16
3
At 31 December 2022
5,897
25,269
37
5,871 226,905 (237,834)
(521)
(27,649)
(2,025)
*
The other reserves balance in the consolidated statement of financial position represents an aggregate of other reserves, the merger relief reserve, the
reverse takeover reserve and the foreign currency reserve.
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
123 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Consolidated Statement of Changes in Equity
for the Year Ended 31 December 2023
At 1 January 2023
Loss for the year
Foreign currency translation
reserve reclassified to
comprehensive income on
disposal of 81% of TradeFlow
Forex retranslation difference
Share
capital
£ 000
Share
premium
£ 000
Other
reserves*
£ 000
Note
Share-
based
payment
reserve
£ 000
Merger
reserve*
£ 000
Reverse
takeover
reserve*
£ 000
Foreign
currency
reserve*
£ 000
Retained
losses
£ 000
Total
£ 000
5,897 25,269
37
5,871 226,905 (237,834)
(521)
(27,649)
(2,025)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(4,345)
(4,345)
62
304
-
-
62
304
5,897 25,269
37
5,871 226,905 (237,834)
(155)
(31,994)
(6,004)
Issuance of new shares
15
90
2,160
Costs incurred in connection
with the issuance of new
ordinary shares
Credit to equity for issue of
warrants
Exercise of Open Offer
Warrants
Increase in fair value of
previously issued warrants
Equity settled employee share
based payment schemes
Pension plan acturial gain or
loss
24
15
-
-
2
-
-
-
(1,971)
-
70
(132)
-
-
At 31 December 2023
5,989 25,396
-
-
-
-
-
-
(1)
36
-
-
1,717
(95)
346
130
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
2,250
(1,971)
1,717
95
72
(214)
-
-
-
130
(1)
7,969 226,905 (237,834)
(155) (32,113)
(3,807)
*
The other reserves balance in the consolidated statement of financial position represents an aggregate of other reserves, the merger relief reserve, the
reverse takeover reserve and the foreign currency reserve.
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
124 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Consolidated Statement of Changes in Cash Flows
for the Year Ended 31 December 2023
Year ended
31 December 2023
£ 000
Year ended
31 December 2022
£ 000
Note
Cash flows from operating activities
Loss before interest and tax for the year from continuing operations
Loss before interest and tax for the year from discontinued operations
Total loss for the year before interest and tax
Adjustments for non-cash acquisition related costs
Acquisition related earn-outs
Amortisation of intangible assets arising on acquisition
Adjustment for impairment charge
Impairment charges
Adjustment for fair value on investments
Fair value adjustments to investments
Adjustments for non-cash costs related to the disposal of the discontinued operations
Foreign currency translation loss reclassified to comprehensive income
Profit on disposal of 81% of TradeFlow
Other non-cash adjustments
Other depreciation and amortisation
Increase to provisions
Decrease/(increase) in accrued income
Decrease/(increase) in trade and other receivables
(Decrease)/increase in trade and other payables
Other decreases/(increases) in net working capital
Net cash flows from operations
Interest paid in cash
Income taxes paid in cash in respect of prior period amounts owing
26
6
27
26
26
(4,077)
(115)
(4,192)
-
442
384
68
62
(718)
238
137
81
118
5
401
(759)
385
(3,586)
(47)
-
(5,729)
(1,955)
(7,684)
(710)
846
1,843
-
-
-
1,979
(134)
51
110
(38)
(44)
1,158
337
(4,265)
(14)
(276)
Net cash flow from operating activities
(3,633)
(4,555)
Cash flows from investing activities
Purchase of intangible assets
Increase in other non-current assets
Purchase of tangible assets
Cash inflow due to consideration received from related party on disposal of
discontinued operations
12
(458)
(1,175)
-
-
1,228
(18)
(4)
-
125 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Consolidated Statement of Changes in Cash Flows
for the Year Ended 31 December 2023
Cash outflow on disposal of discontinued operations
Net cash flows from investing activities
Cash flows from financing activities
Net cash inflow from new long-term borrowings
Cash repayment of existing long-term borrowings
Cash inflow from issue of new ordinary shares
Cost of share issue paid in cash
Other finance costs paid in cash
Cash inflow from convertible loan notes
Cash repayment of loan notes and convertible loan notes
Net cash flows from financing activities
Net movement 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
Significant non-cash transactions
Note
26
25
Year ended
31 December 2023
£ 000
Year ended
31 December 2022
£ 000
(324)
446
655
(105)
2,322
(254)
(6)
-
-
2,612
(575)
(1)
581
5
-
(1,197)
2,334
-
7,013
(231)
(425)
1,500
(5,572)
4,619
(1,133)
(13)
1,727
581
During the year ended 31 December 2023, there were no significant non-cash transactions.
During the prior year ended 31 December 2022, the Group reported the following significant non-cash transactions:
> A total of 5,298,382,757 new ordinary shares were issued during the prior year to extinguish £3,274,166 principle value of
convertible loan notes; and
> 213,525,520 new ordinary shares were issued during the prior year to settle the acquisition related earn-out payments for
the financial year ended 31 December 2021.
The reconciliation of the movement in net debt is set out in note 23.
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.
126 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Consolidated Financial Statements
for the Year Ended 31 December 2023
1 General information
Supply@ME Capital plc is a public limited company incorporated
in England and Wales. The address of its registered office is
27/28 Eastcastle Street, London, W1W 8DH, United Kingdom.
Supply@ME Capital’s shares are listed on the Standard List
of the main market of the London Stock Exchange.
These consolidated financial statements have been
prepared in accordance with UK adopted International
Accounting Standards.
The financial statements of the Group, consisting of Supply@
ME Capital plc (the “Company”) and its subsidiaries (the
“Group”), are presented in Pounds Sterling and all values are
rounded to the nearest thousand pounds (£’000) except
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
As at 31 December 2023 the Group had a cash and cash
equivalents balance from continuing operations of £5,000
(31 December 2022: £257,000 cash and cash equivalents
from continuing operations, £324,000 cash and cash
equivalents from discontinued operations). The Group’s
consolidated net current liabilities of £2,691,000 as at 31
December 2023, compared to a consolidated net current
liability position of £828,000 as at 31 December 2022.
The Group has posted a total comprehensive loss for
the year ended 31 December 2023 of £4,041,000 (2022:
comprehensive loss of £10,417,000) and retained losses
as at 31 December 2023 were £32,113,000 (31 December
2022: retained losses £27,649,000).
Funding secured during 2023
During the year ended 31 December 2023, the Group
continued to source additional funding with the primary aim
of allowing it to meet its working capital and growth needs
as it focuses on scaling up the Group’s business model
and the continued investment into the Group’s Platform. In
sourcing this new funding, the focus has been on creating
a more stable source of Group funding. These new sources
of funding were announced in conjunction with the issue of
the 2022 Annual Report on 28 April 2023 and the interim
results for the six month period ended 30 June 2023 on 29
September 2023. These new sources of funding included:
> the subscription agreement with Venus Capital S.A.
(“Venus Capital”) dated 28 April 2023 for the issue of the
4,500,000 new ordinary shares (the “Subscription Shares”)
at £0.0005 per Subscription Share (the “Subscription
Agreement”). The issue of the Subscription Shares raised
gross proceeds of £2,250,000 during the first six months
of the year (the “2023 Venus Subscription”);
> the fixed term unsecured working capital loan
agreement with The AvantGarde Group S.p.A (“TAG”),
the Group’s major shareholder, dated 28 April 2023
(the “TAG Unsecured Working Capital facility”), which
was then amended on 30 June 2023 in conjunction
with the finalisation of the disposal of the 81% stake
in ownership of TradeFlow Capital Management Pte.
Limited (“TradeFlow”) (the “TradeFlow Restructuring”). On
30 June 2023, the Company issued a draw down notice
to TAG under the amended TAG Unsecured Working
Facility for the full £800,000 of funding available under
this facility. As at 31 December 2023, £250,000 had been
received from TAG in respect of this facility. As set out in
note 30, subsequent to 31 December 2023, and prior
to the issue of these financial statements, the remaining
£550,000 had been received from TAG. Additionally, on
26 March 2024, the Company and TAG signed a second
deed of amendment agreement, which allowed the full
outstanding amount of the amended TAG Unsecured
Working Capital facility to be extinguished by the issue of
1,500,000,000 new ordinary shares issued to TAG on 28
March 2024; and
> the top up unsecured shareholder loan agreement
with TAG, dated 28 September 2023 (“TAG Top-Up
Shareholder Loan Agreement”), details of which are set
out below:
a) The ability of the Company to draw down up to £3.5
million in monthly instalments over the period to 30
June 2025;
b) On a monthly basis the Board will assess (acting in
good faith and in its sole and absolute discretion)
if the Group’s projected cash balance on the last
business day of the coming calendar month will be
less than £250,000 following the Group’s scheduled
balance of receipts and payments for the next month
by reference to, inter alia, the Group’s contracted
receivables, revenues and payables due for receipt
or payment in the next month, the Group’s contracted
fixed operating expenditure and/or capital expenditure
due for payment in the next month, the cash inflows
in the next month arising from any warrants that
have been contractually exercised and any projected
unrestricted cash amounts resulting from any
contractually agreed alternative equity, debt or hybrid
financing (including, but not limited to, pursuant to a
pre-emptive offering of ordinary shares and a non-pre-
emptive offering of ordinary shares) for such month;
127 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Consolidated Financial Statements
for the Year Ended 31 December 2023
2 Accounting policies
c)
If the above assessment results in the Group’s
projected cash balance on the last business day
of the coming calendar month being less than
£250,000, the Company may draw down an amount
under the TAG Top-Up Shareholder Loan Agreement
which is no greater than the GBP amount to ensure
that the Group’s bank balances in the coming month
shall be equal to £250,000;
d) Repayment of any sum drawn down under the TAG
Top-Up Shareholder Loan Agreement will be due
five calendar years (calculated on the basis of a year
of 360 days) from the date which funds are received
by the Company subject to the relevant draw down
request; and
e) Any sums drawn down by the Company under
the TAG Top-Up Unsecured Shareholder Loan will
attract a non-compounding interest rate of 10%
per annum, and any principal amount (excluding
accrued interest) outstanding on a relevant due date
shall attract a compounding rate of 15% per annum
thereafter. Interest will be due to be paid annually on
31 March of each relevant calendar year.
As at 31 December 2023, the Company had issued draw
down notices to TAG for a total amount of £969,000 under
the Top-Up Shareholder Loan Agreement, however the
full amount of this draw down was outstanding. As set out
in note 30, subsequent to 31 December 2023, and prior
to the issue of these financial statements, the Company
issued additional draw down notices under the Top-Up
Shareholder Loan Agreement to the value of £779,000 and
had received £nil from TAG in respect of this facility.
In addition to the new sources of funding securing during 2023,
which have been highlighted above, the Company completed
the TradeFlow Restructuring on 30 June 2023 and the remaining
cash proceeds that were due from the buyers of TradeFlow
(the “Buyers”) as a result of this transaction was £2,000,000.
TAG assumed this £2,000,000 obligation of the Buyers by way
of a deed of novation also signed on 30 June 2023 (“Deed
of Novation”) and in exchange received consideration TAG
acquired 1,026,525,520 existing ordinary shares of nominal
value £0.00002 each in the capital of the Company from the
Buyers. This £2,000,000 was due in tranches and the final
tranche was due to be payable by 31 January 2024.
As at 31 December 2023, £1,228,000 of the £2,000,000 due
under the Deed of Novation had been repaid by TAG to the
Company. The payment had been received through a split of
£771,000 in cash, £421,000 by way of formal debt novation
agreements with specific suppliers whereby the debt held by
the Group companies was novated to TAG with no recourse
to the Group companies, and £36,000 by way of offset
against amounts owed by the Group companies to TAG.
The Company is now charging a late fee to TAG calculated
at a compounding rate of 15% per annum on any amounts
of the instalments not transferred to the Company by the
relevant due date. As set out in note 30, subsequent to 31
December 2023, and prior to the issue of these financial
statements £655,000 of the £772,000 outstanding at 31
December 2023 was repaid through the combination of
cash payments and the offsetting of amounts due to TAG
from the Group, leaving a remaining balance of £117,000.
Taking into consideration the factors above and in order to
consider their assessment of the Group as a going concern,
the Directors have reviewed the forecast cash flows for
the next 12 months from approval of these consolidated
financial statements. The cash flow forecasts take into
account that the Group meets its day to day working capital
requirements through its available and committed cash
resources. The Directors have prepared the forecast using
their best estimates, information and judgement at this time,
including the receipt of cash that is contractually committed
under the TAG Top-Up Shareholder Loan Agreement. The
Directors have also considered the expected cash flows
arising from the use of the Group’s innovative Platform to
facilitate Inventory Monetisation transactions. This reflects
the fact that the Directors expect the Group to continue
to prove the concept of its business model and to fully
operationalise in the near future following the progress
steps that have made to date.
Despite the facts outlined above, there continues to be an
absence of a historical recurring track record relating to
multiple Inventory Monetisation transactions being facilitated
by the Group’s Platform and the Group being cash flow
positive. As such the Directors have prudently identified
uncertainty in the cash flow model. This uncertainty arises
with respect to both the future timing and growth rates of the
forecast cash flows arising from the Group’s multiple Inventory
Monetisation revenue streams. In this regard, if these future
revenues are not secured as the Directors envisage, it is
possible that the Group will have a shortfall in cash and require
additional funding during the forecast period. In addition the
cash inflows arising from the TAG Top-Up Shareholder Loan
Agreement have not yet been fully received. These amounts
have been factored into the cash flow forecast in line with the
contractual commitments received from the counterparty and/
or the latest updates from TAG. As such, there is a risk that
these cash flows might not be received or might not reach
the Group in the time frame expected despite the contractual
commitment in place.
On the basis of the factors identified in the above paragraph,
the Directors believe there are material uncertainties
which may cast significant doubt upon the entities ability to
continue as a going concern.
128 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
2 Accounting policies
The Directors do however remain confident in the business
model and believe the Group could be managed in a way to
allow it to meet its ongoing commitments and obligations
through mitigating actions including cost saving measures and
securing alternative sources of funding should this be required.
As such the Directors consider it appropriate to prepare
these annual consolidated financial statements on a going
concern basis and have not included the adjustments that
would result if the Company and Group were unable to
continue as a going concern.
Adjusted performance measures
Management believes that adjusted performance measures
provide meaningful information to the users of the accounts
on the operating performance of the business. Accordingly,
the adjusted measure of operating profit from continuing
operations excludes, where applicable, impairment charges
and fair value adjustments. These terms are not defined
terms under IFRSs and may therefore not be comparable
with similarly titled profit measures reported by other
companies. They are not intended to be a substitute for,
or superior to, GAAP measures. The items excluded from
adjusted results are those items that are charged to the
consolidated statement of comprehensive income due
to the impairment of the Group’s intangible assets or
investments. They are not influenced by the day-to-day
operations of the Group.
Basis of consolidation
The Group financial statements consolidate those of the
Company and its subsidiary undertakings drawn up to 31
December 2023. 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.
The TradeFlow Restructuring transaction was completed
on 30 June 2023 and at this point the Company reduced
its ownership in TradeFlow from 100% to 19% by selling
81% of the issued share capital to Tom James and John
Collis. As such from 30 June 2023, TradeFlow was no longer
consolidated into the Group’s results and the profit on
disposal of the 81% of TradeFlow has been recognised in the
statement of comprehensive income.
Supply@ME Technologies S.r.l. was incorporated by the
Company in Italy on 25 March 2022 for the purpose of holding
the Group’s intellectual property rights relating to the Platform
together with future developments in a dedicated entity.
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.
New and revised accounting standards and
interpretations
There are no new and revised standards that have a material
impact on the entity in the current or future reporting
periods and on foreseeable future transactions.
New standards, interpretations and amendments not
yet effective
There are no new standards that are issued but not yet
effective which would be expected to have a material impact
on the Company in the current or future reporting periods
or on foreseeable future transactions.
Business Combinations
The acquisition of subsidiaries and businesses are
accounted for using the acquisition method under IFRS 3
(“Business Combinations”).
Measurement of consideration
The consideration for each acquisition is measured at the
aggregate of the fair values, at the date of exchange, of
assets given, liabilities incurred to former owners and equity
instruments issued by the Group in exchange for control of
the acquiree.
Acquisition related earn-out payments (deemed
remuneration)
In accordance with the IFRS Interpretations Committee’s
interpretation of paragraph B55 of IFRS 3 (“Business
Combinations”), the cost of the business combination
excludes consideration which requires post-acquisition
service obligations to be performed by the selling shareholders.
In the event that the deemed remuneration is to be equity
settled under IFRS 2 (“Share-Based Payments”), the fair value
is determined at the grant date and then charged to the
consolidated statement of comprehensive income over the
period of the service obligations.
129 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Consolidated Financial Statements
for the Year Ended 31 December 2023
2 Accounting policies
Fair value assessment
Identifiable assets acquired and liabilities and contingent
liabilities assumed in a business combination are measured
initially at their fair values at the acquisition date. Where the
fair value of the assets and liabilities at acquisition cannot be
determined reliably in the initial accounting, these values are
considered to be provisional for a period of 12 months from
the date of acquisition. If additional information relating to
the condition of these assets and liabilities at the acquisition
date is obtained within this period, then the provisional
values are adjusted retrospectively. This includes the
restatement of comparative information for prior periods.
Other intangible assets
a) Internally developed Inventory Monetisation (“IM”) platform
The core activity of the existing Supply@ME business is the
creation and marketing of a software-driven secure platform
(the “IM Platform”) that can be used for the facilitation,
recording and monitoring of Inventory Monetisation (“IM”)
transactions between third party client companies and
segregated trading companies (known as stock companies).
The software modules which form part of the IM Platform
can also be used, through a White-Label model, by third
party banks in order for them to deploy their own inventory
backed financial products. The internally generated IM
Platform includes not only the software but also:
> the methodologies and business policies underpinning
each IM transaction
Intangible assets arising on business combinations are
recognised initially at fair value at the date of acquisition.
Subsequently they are carried at cost less accumulated
amortisation and impairment charges.
> the legal and accounting frameworks required to support
each IM transaction
> the technical infrastructure (cloud environment, distributed
ledger technology) used to support each IM transaction.
Goodwill
Goodwill arises where the consideration of the business
combination exceeds the Group’s interest in the net fair
value of the identifiable assets, liabilities and contingent
liabilities recognised. This is recognised as an asset and is
tested annually for impairment. The identifiable assets and
liabilities acquired are incorporated into the consolidated
financial statements at their fair value to the Group.
Transaction costs
Transaction costs associated with the acquisition are
recognised in the consolidated statement of comprehensive
income as incurred and separately disclosed due to the
nature of this expense.
Associated with this core activity are significant product
development requirements and expenditure in order to
develop compliance with legal, regulatory, accounting,
valuation and insurance criteria. This expenditure includes
software and infrastructure development, intellectual
property (“IP”) related costs and professional fees related to
the development of legal and accounting infrastructure.
Research expenditure is written off in the year in which it
is incurred. Expenditure on internally developed products,
in particular the IM Platform, is capitalised if it can be
demonstrated that:
> it is technically and commercially feasible to develop the
asset for future economic benefit;
> adequate resources are available to maintain and
Investment in equity instruments
complete the development;
The Group measures its investments in equity instruments,
where no significant influence or control exists, at fair value
with any changes recognised through the statement of
comprehensive income.
Intangible assets
Goodwill
Goodwill arising on consolidation is recognised as an asset.
Following initial recognition, goodwill is subject to impairment
reviews, at least annually, and measured at cost less
accumulated impairment losses. Any impairment is
recognised immediately in the consolidated statement of
comprehensive income and is not subsequently reversed.
> there is the intention to complete and develop the asset
for future economic benefit;
> the company is able to use the asset;
> use of the asset will generate future economic benefit; and
> expenditure on the development of the asset can be
measured reliably.
Where these costs are capitalised, they are initially measured
at cost and are amortised over their estimated useful
economic lives, considered to be 5 years, on a straight-line
basis. Amortisation of this internally developed IM platform is
charged within cost of sales in the consolidated statement of
comprehensive income.
Amortisation methods and useful lives are reviewed at each
reporting date and adjusted if appropriate. The carrying amount
is reduced by any provision for impairment where necessary.
130 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
2 Accounting policies
b) Acquired intangible assets
Intangible assets arising on business combinations are
recognised initially at fair value at the date of acquisition.
Subsequently they are carried at cost less accumulated
amortisation. As the acquired intangible assets recognised
by the Group during the year ended 31 December 2022 and
31 December 2023 arose on the acquisition of TradeFlow,
the amortisation of acquired intangible assets is charged
within loss from discontinued operations in the consolidated
statement of comprehensive income.
The estimated useful lives of the acquired intangible assets
are set out below:
Customer relationships
Brand (TradeFlow)
Commodity Trade Risk Management (“CTRM”)
software
Artificial Intelligence and back-office (“AI”)
software
13 years
5 years
5 years
5 years
Amortisation methods and useful lives are reviewed at each
reporting date and adjusted if appropriate. The carrying amount
is reduced by any provision for impairment where necessary.
Impairment
At each balance sheet date, the Group reviews the carrying
amounts of its intangible assets to determine whether
there is any indication that those assets have suffered
an impairment loss. If any such indication exists, the
recoverable amount of the asset is estimated in order to
determine the extent of any impairment loss. Where the
asset does not generate cash flows that are independent
from other assets, the Group estimates the recoverable
amount of the cash-generating unit to which the asset
belongs. Recoverable amount is the higher of fair value less
costs to sell and value in use.
In assessing value in use, the estimated future cash flows
are discounted to their present value using a pre-tax
discount rate that reflects current market assessments of
the time value and the risks specific to the asset for which
the estimates of future cash flows have not been adjusted. If
the recoverable amount of an asset (or cash-generating unit)
is estimated to be less than its carrying amount, the carrying
amount of the asset (or cash-generating unit) is reduced to its
recoverable amount.
An impairment loss is recognised as an expense immediately.
Where an impairment loss subsequently reverses, the
carrying amount of the asset (or cash-generating unit) is
increased to the revised estimate of its recoverable amount,
but so that the increased carrying amount does not exceed
the carrying amount that would have been determined had
no impairment loss been recognised for the asset (or cash-
generating unit) in prior years. A reversal of an impairment
loss is recognised as income immediately.
Revenue recognition
Revenue for the Group is measured at the fair value of the
consideration received or receivable. The Group recognises
revenue when the performance obligation is satisfied,
the amount of revenue can be reliably measured and it
is probable that future economic benefits will flow to the
entity. Currently the Group’s revenues are recognised at the
point when the relevant performance obligation has been
satisfied, this can result in all the revenue being recognised a
specific point in time or over time as detailed below.
Following the TradeFlow Restructuring the Group is now
focussed on its core business lines:
> IM transactions from the pipeline originated by the Group
and funded by third-party investors (“Open Market IM”); and
> IM deals with local commercial banks and their client
companies (“White-Label IM”).
The Group recognises revenue from the following activities:
a) Open Market IM - Due diligence fees:
This revenue arises from due diligence services performed
by the Group in relation to the potential client companies.
This due diligence covers topics such as the client’s financial
information, operations, credit rating and analysis of its
inventory. Given the stage of the Group’s development, and
the evolution of the Group’s contracting arrangements, the
due diligence revenues recognised by the Group to date
have been limited. Further details are provided below:
Historical contractual arrangements - Prior to June 2020, the
Group’s contractual arrangements required the client to
make a down payment intended to remunerate the Group
for the due diligence services being provided. However,
these agreements did not clearly identify the Group’s
performance obligation and such down payments were also
refundable under certain circumstances and up to the point
when the Platform was able to be used for the first time by
the client companies.
Due to the above circumstances, these down payments
have not been recognised as revenue under IFRS 15
(“Revenue from Contracts with Customers”) until the specific
performance obligation, being the use of the Group’s
Platform for the first time, has been satisfied by the Group.
Until such time, these amounts have been recognised as
131 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Consolidated Financial Statements
for the Year Ended 31 December 2023
2 Accounting policies
deferred income in the statement of financial position, or
as other payables in the case where a refund has been
requested (due to the current delays being experienced by
the Group), but not yet paid as at the balance sheet date.
Current contractual arrangements - Post June 2020, the
Group updated its contractual arrangements to specifically
identify a separate performance obligation in relation to the
completion of the due diligence services being provided by
the Group, also considering the actual benefits the client
companies can directly obtain from such activities, even
in the case where the Inventory Monetisation transaction
does not take place. In these contracts, the due diligence
fees are paid in advance by the client companies, and the
revenue is recognised when the Group has successfully
fulfilled its performance obligation, being the completion
of the due diligence service and communication to the
client in this respect through the issuance of a detailed due
diligence report. Prior to the completion of the performance
obligation, the due diligence fees received are held on the
balance sheet as deferred income.
In order to conclude if the performance obligations have
been successfully fulfilled, management currently assess this
on a client-by-client basis to ensure that the control of the
due diligence has been transferred to the client company. In
developing this accounting policy management have made
the assessment that the due diligence services result in a
distinct beneficial service being provided to client companies
as the information provides insight into their business which
can also be used for alternative purposes as well (such as
client companies business and operational optimisation).
This is also referred to the critical accounting judgements
and sources of estimation uncertainty note.
b) Open Market IM – Origination fees:
This revenue arises from origination of the contracts
between the client company wishing to have their Inventory
Monetised and the independent stock (trading) company
that purchased the inventory from the client company. Given
the stage of the Group’s development, and the evolution of
the Group’s contracting arrangements, as at 31 December
2023, the Group had facilitated two IM transactions over
its IM Platform and therefore had received origination fees
from two client companies, one of which took place during
the year ended 31 December 2022 and the other during
the year ended 31 December 2023. The non-refundable
origination fees received from the client company relates
to the fee payable to the Group at the point in time the
client company enters into binding contracts with the stock
(trading) company to purchase its inventory. The Group have
recognised the non-refundable origination fee as revenue at
the point in time that the fee becomes receivable from the
client company. This is consistent with the fact that there are
no performance obligations that remain to be completed by
the Group relating to this fee at this point in time.
c) Open Market IM – IM Platform usage fees:
This revenue arises from usage of the Group’s IM Platform
by the independent stock (trading) company to facilitate the
purchase of the inventory from the client company. Given
the stage of the Group’s development, and the evolution of
the Group’s contracting arrangements, as at 31 December
2023, the Group had facilitated two IM transactions over
its IM Platform and therefore had received IM Platform
usage fees from the independent stock (trading) company
in respect of these two IM transactions only. Management
concluded that the usage of the IM Platform granted by
the Group to the stock (trading) company represented
a Software as a Service (“Saas”) contract and as such the
annual IM Platform usage fees are recognised over time in
line with the time period covered by the contract as required
by IFRS 15 (“Revenue from Contracts with Customers”). As
the annual IM Platform usage fees are received by the Group
at the beginning of the annual period, any unrecognised
amounts are held on the balance sheet as deferred income.
d) Open Market IM – IM service fees:
This revenue arises as a result of the service fees charged by
the Group to the independent stock (trading) company as
remuneration for the support and administration activities,
such as the monitoring of the inventory purchased, the
Group performs in connection with the use of the Group’s IM
Platform. Given the stage of the Group’s development, and the
evolution of the Group’s contracting arrangements, as at 31
December 2023, the Group had facilitated two IM transactions
over its IM Platform and therefore had received IM service
fees from the independent stock (trading) company in respect
of two IM transactions only. Management concluded that the
support and administration activities performed in exchange
for these fees represent separately identifiable performance
obligation and as such the annual fees are recognised over
time in line with the time period covered by the contract
as required by IFRS 15 (“Revenue from Contracts with
Customers”). These service fees are accrued up to the point
the fees are received and then any unrecognised amounts are
held on the balance sheet as deferred income.
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, the cost of sales includes both the costs
of the work force who are engaged in the due diligence
related processes, the amortisation of the costs relating
to the internally developed IM platform, and any external
costs directly related to the completion of the due diligence
activities. Management regard these items as the direct
132 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
2 Accounting policies
costs associated with generating the Open Market IM
revenue; in line with similar fintech companies.
Leases
The Group does not have any material lease arrangements
that would be required to be accounted for under IFRS
16 (“Leases”). In addition, in accordance with IFRS 16
(“Leases”), any short term leases costs are recognised in the
consolidated statement of comprehensive income in the
period which is covered by the term of the lease.
Property, Plant and equipment
Recognition and measurement
All property, plant and equipment is stated at cost less
accumulated depreciation and impairment. The costs of
the plant and equipment is the purchase price plus any
incidental costs of acquisition. Depreciation commences at
the point the asset is brought into use.
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.
In line with IAS 1 (“Presentation of Financial Statements”) any
deferred tax assets have been classified as non-current assets.
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.
Cash and cash equivalents
The residual values and useful economic lives of plant and
equipment are reviewed by management on an annual basis
and revised to the extent required.
Depreciation
Depreciation is charged 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:
> Computers and IT equipment at 33% per annum.
Tax
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.
Functional and presentation currencies
The consolidated financial statements are presented in
pounds sterling (£), the Company’s functional currency.
The tax expense for the period comprises current tax,
including any associated penalties and late payment charges.
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 temporary 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
method. Deferred tax 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
Foreign currency
The main currencies for the Group are the euro (EUR), pounds
sterling (GBP), US dollars (USD) and Singapore dollars (SGD).
Foreign currency transactions and balances
Items included in the consolidated financial statements of
each of the Group’s subsidiaries are measured using their
functional currency. The functional currency of the parent
and each subsidiary is the currency of the primary economic
environment in which the entity operates.
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
133 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Consolidated Financial Statements
for the Year Ended 31 December 2023
2 Accounting policies
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.
See applicable exchange rates to GBP used during FY23 and
FY22 below:
2023
2022
Closing
Average
Closing
Average
SGD*
EUR
USD
1.7188
1.6684
1.6218
1.7221
1.1534
1.1495
1.1276
1.1780
1.2732
1.2432
1.2102
1.2495
*
The 2023 Singapore dollar (“SGD”) exchange rate shown in the table above
are for the following periods, closing – 30 June 2023, average – for the six
month period ended 30 June 2023. This reflects the fact that the TradeFlow
Restructuring was finalised and completed on 30 June 2023 and TradeFlow
was deconsolidated from the Group’s results from this date.
Consolidation of foreign entities
On consolidation, results of the foreign entities are
translated from the local functional currency to pounds
sterling, the presentation 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.
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,
receivable from related party and 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. Where applicable, 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 (“Financial
Instruments”) 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.
Employee benefits
Financial liabilities
Short-term employee benefits
The Group accounts for employee benefits in accordance
with IAS 19 (“Employee Benefits”).
Classification
Financial liabilities comprise trade and other payables, long-
term borrowings, loan notes and convertible loan notes.
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 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 employee benefits in accordance
with IAS 19 (“Employee Benefits”).
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.
Long-term borrowings and loan notes
Interest bearing long-term borrowings and loan notes and
are initially recorded at the proceeds received, net of direct
issue costs (including commitment fees, introducer fees
and the fair value of warrants issued to satisfy issue costs).
Finance charges, including direct issue costs, are accounted
for on an amortised cost basis to the consolidated
statement of comprehensive income using the effective
134 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
2 Accounting policies
interest method and are added to the carrying amount of
the instrument to the extent that they are not settled in the
period in which they arise. The carrying value of the loan
notes have been adjusted for any principal repayments
made since inception.
Convertible loan notes
Convertible loan notes that were issued by the Group in
the prior period were recorded at the fair value of the
convertible loan notes issued, net of direct issue costs
including commitment fees. Finance charges, including direct
issue costs, were accounted for on an amortised cost basis
to the consolidated statement of comprehensive income
using the effective interest method and are added to the
carrying amount of the instrument to the extent that they
are not settled in the period in which they arise. The carrying
value of the convertible loan notes were adjusted to take
into account the fair value of those notes that have been
converted into new ordinary shares since inception.
Provisions
Provisions are recognised when the Group has a present
legal or constructive obligation as a result of a past event,
it is probable that the Group will be required to settle the
obligation and the amount can be reliably estimated.
Share-based payments
Equity-settled share-based payments relate to the warrants
issued in connection with the cost of issuing new equity, loan
notes and convertible notes during the relevant year, and
acquisition related earn-out payments.
Share warrants
Certain equity-settled share-based payments relate to the
warrants issued in connection with the cost of issuing new
equity, loan notes and convertible loan notes. These equity-
settled share-based payments are measured at the fair value
of the equity instruments at the grant date. The fair value
excludes the effect of non-market-based vesting conditions.
Details regarding the determination of the fair value of these
equity-settled share-based transactions are set out in note 24.
The fair value determined at the grant date of the equity-
settled share-based payments relating to the warrants
issued in connection with the issue of equity are netted off
against the amount of share premium that is recognised in
respect of the share issue to which they directly relate. Any
amounts in excess of the share premium recognised, are
netted off against retained losses.
The fair value determined at the grant date of the equity-settled
share-based payments relating to the warrants issued in
connection with the issue of loan notes, convertible loan notes or
other debt instruments are netted off against the fair value of the
underlying loan notes, convertibles loan notes to which they directly
relate. The fair value is then expensed together with the other related
finance costs on an amortised cost basis to the Group’s statement of
comprehensive income using the effective interest method.
If there are any subsequent modifications made to any of
the terms of equity-settled share-based payments relating
to the warrants issued by the Group, the change in fair value
is calculated as the difference between the fair value of the
modified equity-settled share-based payment and that of the
original equity-shared share-based payment. This calculation
relates to any warrants that are still outstanding and have
not been converted into ordinary shares at the time of the
subsequent modification. The change in the fair value is then
accounted on a consistent basis to the initial fair value.
In respect of the share-based payments, the fair value is not
revised at subsequent reporting dates, however, the fair
value is released from the share-based payment reserve at
the point in time that any of the warrants are exercised by
the third party holder.
Employee share schemes
Grants made to certain employees of the Group will
result in a charge recognised in the Group’s statement of
comprehensive income. Such grants will be measured at fair
value at the date of grant and will be expensed on a straight-
line basis over the vesting period, based on the Group’s
estimate of the shares that will eventually vest. Vesting
assumptions are reviewed during each period to ensure
they reflect current expectations.
Full details of the Group’s share-base payments refer to note 24.
Acquisition related earn-out payments
In addition, the Group previously recognised a share-based
payment reserve in connection with acquisition related
earn-out payments arising from the acquisition of TradeFlow.
The fair value of these earn-out payments were measured
using the same methods as outlined above. Given the
service conditions related to these payments are linked to
one of the Group’s current subsidiaries, the share-based
payment expense is recognised within the consolidated
financial statements as an increase to the share-based
payment reserve and through the Group’s statement of
comprehensive income. The fair value determined at the
grant date of these equity-settled share-based payments
are recognised over the vesting period on a straight-line
basis, based on the estimate of equity instruments that will
eventually vest. Vesting assumptions are reviewed during
each period to ensure they reflect current expectations
135 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Consolidated Financial Statements
for the Year Ended 31 December 2023
2 Accounting policies
and any changes required to true-up the related share-
based payment reserve are recognised through the Group’s
income statement in the relevant period.
Discontinued Operations
The Group classifies non-current assets and disposal groups
as held for sale if their carrying amount will be recovered
principally through a sale transaction rather than through
continuing use. Non-current assets and disposal groups
classified as held for sale are measured at the lower of their
carrying value and fair value less costs to sell. Costs to sell
are the incremental costs directly attributable to the disposal
of an asset (disposal group), excluding finance costs and
income tax expense.
The criteria for held for sale classification is regarded as
met only when the sale is highly probable and the asset or
disposal group is available for immediate sale in its present
condition. Actions required to complete the sale should
indicate that it is unlikely that significant changes to the
sale will be made or that decisions to sell will be withdrawn.
Management must be committed to the plan to sell the
asset and the sale expected to be completed within one year
from the date of the classification.
Assets and liabilities classified as held for sale are presented
separately in the balance sheet.
A disposal group qualifies as a discontinued operation if it is
a component of an entity that either has been disposed or,
is classified as held for sale, and:
> Represents a separate major line of business or
geographical area of operations: and
> Is part of a single co-ordinated plan to dispose of a separate
major line of business or geographical area of operations.
Discontinued operations are excluded from the results of
continuing operations and are presented as a single amount
as profit or loss after tax from discontinued operations
in the income statements. All other notes in the financial
statements include amounts for continuing operations,
unless otherwise mentioned.
The Board considered that in light of the TradeFlow
Restructuring that commenced during the second half of
2022, the TradeFlow operations meet the criteria to be
classified as held for sale at 31 December 2022 as at this
date the details of the TradeFlow Restructuring had all been
agreed in principle between the parties and was expected
to be completed post year end together with the publication
of the 2022 Annual Report and Accounts. As a result the
TradeFlow operations were available for immediate sale in
its present condition and it was highly probable that that
sale would be completed within 12 months of 31 December
2022. The TradeFlow Restructuring was completed and
finalised on 30 June 2023 at which point the Group reduced
its ownership in TradeFlow from 100% to 19%. Prior to
completion of the TradeFlow Restructuring, the TradeFlow
operations were continued to be classified as held for sale in
the Group’s consolidated financial statements. Following the
30 June 2023, the TradeFlow operates were deconsolidated
from the Group’s financial statements.
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.
“Share-based payment reserve” represents the adjustments
to equity in respect of the fair value of outstanding share-
based payments including warrants issued in connection
with the cost of issuing new equity or debt instruments
during the relevant period, employee share schemes and
acquisition related earn-out payments.
“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 losses” 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.
136 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
2 Accounting policies
Critical accounting judgements and sources of
estimation uncertainty
The preparation of financial information in conformity with
IFRS requires the use of certain critical accounting estimates.
It also requires the Directors to exercise their judgement in
the process of applying the accounting policies which are
detailed above. These judgements are continually evaluated
by the Directors and management and are based on
experience to date and other factors, including reasonable
expectations of future events that are believed to be
reasonable under the circumstances.
The key estimates and underlying assumptions concerning
the future and other key sources of estimation uncertainty
at the statement of financial position date, that have a
significant risk of causing a material adjustment to the
carrying amounts of assets and liabilities within the next
financial period, are reviewed on an ongoing basis. Revisions
to accounting estimates are recognised in the period in
which the estimate is revised if the revision affects only that
period, or in the period of the revision and future periods if
the revision affects both current and future periods.
A number of these key estimates and underlying
assumptions have been considered as a result of specific
transactions outlined in these consolidated financial
statements. The Directors have evaluated the estimates
using historical experience and other methods considered
reasonable specific to the circumstances. The Directors
have also but also in consultation with third-party experts
where appropriate. These estimates will be evaluated on an
ongoing basis as required.
The Group believes that the estimates and judgements that
have the most significant impact on the annual results under
IAS are as set out below:
Judgements
Internally developed intangible assets
The cost of an internally generated IM platform comprises all
directly attributable costs necessary to create, produce, and
prepare the asset to be capable of operating in the manner
intended by management. During the period judgement
was required to distinguish those costs that were capable of
being capitalised under IAS 38 (“Intangible assets”) and that
costs that related to research activities, the cost of which has
been recognised as an expense during the relevant period.
Revenue recognition – assessment of performance obligations
> The Directors are required to make a judgement as
to if the due diligence services represent a distinct
performance obligation under IFRS 15 (“Revenue from
Contracts with Customers”). The Board and management
have concluded that this is indeed the case due to
the distinct beneficial service being provided to client
companies through the delivery of the due diligence
report which provide insight and information into the
business.
> The Directors are required to make a judgement as
to if the receipt of non-refundable origination fees
received from the client companies represent a distinct
performance obligation under IFRS 15 (“Revenue from
Contracts with Customers”). The Board and management
have concluded that no separately identifiable
performance obligation is carried out by the Group
associated with this fee.
Estimates
Valuation of share warrants issued
During the current financial year the Group issued share
warrants in connection with the new equity funding. In the
prior financial year the Company also issued share warrants
in connection with loan notes and certain convertible loan
notes alongside the issue of new equity. As these share
warrants were issued as a cost of securing new equity
investment or funding facilities for the Group, they fall into
the scope of IFRS 2 (“Share-based payments”). As such the
Directors were required to determine the fair value of the
equity-settled share-based payments at the date on which
they were granted. Judgement was required in determining
the most appropriate inputs into the valuation models
(Black Scholes) used and the key judgemental input was
the expected volatility rate of the Company’s share price
over the relevant period and the assumption applied in the
models were between 97% - 88% and were based the actual
volatility of the Company’s share price from the date of the
reverse takeover (being March 2020) to the date at which
the relevant valuation model was run.
The fair value cost of those share warrants that were issued
in connection with new equity funding during the financial
year ended 31 December 2023 were recognised as debits to
equity on the consolidated statement of financial position. If
the expected volatility rate was adjusted by plus 10%, then
the impact on the fair value recognised as the initial debit to
equity in the current year would have been approximately
plus £84,000. If the expected volatility rate was adjusted by
minus 10%, then the impact on the fair value recognised as
the initial debit to equity in the current year would have been
approximately minus £89,000.
The fair value cost of those share warrants that were issued
in connection with new debt funding were recognised in the
consolidated statement of comprehensive income. There
were no share warrants issued in the financial year ended 31
December 2023 that were connected with new debt funding.
137 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Consolidated Financial Statements
for the Year Ended 31 December 2023
2 Accounting policies
During the current year the expiry date of certain of
the share warrants, that had previously been issued in
connection with the issue of new equity during the year
ended 31 December 2022, was extended by 12 months. The
Directors were required to determine the change in the fair
value of these share warrants as a result of the modification
to the expiry date. To do so, the same valuation model
(Black Scholes) was used and the change in fair value was
calculated as the difference between the fair value of the
modified shared warrants and that of the original fair value.
Non-controlling discount
During the current financial year, the Group finalised and
completed the TradeFlow Restructuring in which it disposed
of 81% of its investment in TradeFlow. To determine the
accounting fair value of the retained 19% investment in
TradeFlow, management used the specifics set out in the
TradeFlow share purchase agreement dated 30 June 2023.
Further details of this calculation are set out in note 26 to these
consolidated financial statements. Following this calculation,
management then applied a discount of 25% to this fair value
calculated at 30 June 2023 to take account of the fact that
the Company no longer controls the TradeFlow operations.
This discount applied is a management judgement that will
continue to be reassessed at each reporting date. If the
discount rate was adjusted by plus 10%, then the impact on
the profit on disposal of 81% of TradeFlow recognised in the
statament of comprehensive income in the current financial
year would have been lower by £47,000. If the discount rate
was adjusted by minus 10%, then the impact on the profit on
disposal of 81% of TradeFlow recognised in the statement of
comprehensive income in the current financial year would
have been higher by £47,000.
138 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
3 Segmental reporting
IFRS 8 (“Operating segments”) requires the Group’s operating segments to be established on the basis of the components of
the Group that are evaluated regularly by the chief operating decision maker, which has been determined to be the Board of
Directors. At this early stage of development, the Group’s structure and internal reporting is continually developing. Prior to
the acquisition of TradeFlow on 1 July 2021, the Board considered that the Group operated in a single business segment of
due diligence and all activities were undertaken in Italy.
Following the acquisition of TradeFlow, the Board of Directors managed the Group as two operating segments being
Inventory Monetisation (currently comprising largely of the Group’s Supply@ME operating subsidiary) and investment advisory
(comprising the TradeFlow operations), alongside the head office costs (comprising the Company). To date the Inventory
Monetisation segment has been focused on the development of the IM platform, the provision of due diligence services and
the facilitation of the initial IM transaction that took place during 2022 and 2023.
During 2022, the management team and the Board of Directors of the Company began work in respect of the TradeFlow
Restructuring and as a result, the TradeFlow operations have been classified as a discontinued operation under IFRS 5 (“Non-
current assets held for sale and discontinued operations”) for the purposes of the consolidated annual financial statement
for the year ended 31 December 2022 and for the year ended 31 December 2023. Further to the above, the TradeFlow
Restructuring transaction was finalised on 30 June 2023 resulting in the Group reducing its ownership in TradeFlow from
100% to 19% through the disposal of 81% of the issued share capital in TradeFlow. As such the Group has reverted back to
a single segment from its continuing operations for the financial year ended 31 December 2022 and for the year ended 31
December 2023, being Inventory Monetisation, alongside the head office costs (largely compromising the Company).
The key metrics assessed by the Board of Directors include revenue and adjusted operating profit (before impairment
charges and fair value adjustments) which is presented below. Revenue is presented by basis of IFRS 15 (“Revenue from
Contracts with Customers”) revenue recognition and by service line.
Year ended 31 December 2023
Revenue from continuing operations
Due diligence fees
Inventory Monetisation fees
Revenue from continuing operations
Inventory
Monetisation
£ 000
Head
office
£ 000
Consolidated Group –
continuing operations
£ 000
94
64
158
-
-
-
94
64
158
Operating loss from continuing operations before impairment charges
and fair value adjustments
(1,061)
(2,564)
(3,625)
All the Group’s revenue from due diligence fees is recognised at a point in time. Of the revenue generated from Inventory
Monetisation fees, £11,000 is generated from origination fees which is recognised at a point in time, and the remaining
£53,000 is generated from usage of the Group’s IM Platform and services provided by the Group in connection with the IM
transaction. This £53,000 of revenue is recognised over time and the amount recognised in the current financial year relates
to the performance obligations satisfied prior to 31 December 2023.
Year ended 31 December 2023
Balance sheet
Assets
Liabilities
Net (liabilities)
Inventory
Monetisation
£ 000
Head
office
£ 000
Consolidated Group –
continuing operations
£ 000
971
1,213
(4,321)
(1,670)
(3,350)
(457)
2,184
(5,991)
(3,807)
139 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Consolidated Financial Statements
for the Year Ended 31 December 2023
3 Segmental reporting
Geographical analysis
The Group’s Inventory Monetisation operation is currently predominately located in Europe, while the investment advisory
operations (classified as a discontinued operation) were predominately located in Singapore for the six month period from 1
January to 30 June 2023.
Comparative segmental reporting
Year ended 31 December 2022
Revenue
Due diligence fees
Inventory Monetisation fees
Revenue by operating segment
Inventory
Monetisation
£ 000
Head
office
£ 000
Consolidated Group –
continuing operations
£ 000
102
36
138
-
-
-
102
36
138
Operating loss from continuing operations before impairment charges
(1,308)
(3,343)
(4,651)
All the Group’s revenue from due diligence fees is recognised at a point in time. Of the revenue generated from Inventory
Monetisation fees, £20,000 is generated from origination fees which is recognised at a point in time, and the remaining
£16,000 is generated from usage of the Group’s IM Platform and services provided by the Group in connection with the IM
transaction. This £16,000 of revenue is recognised over time and the amount recognised in the prior financial year relates to
the performance obligations satisfied prior to 31 December 2022.
Year ended 31 December 2022
Balance sheet
Assets
Liabilities
Net (liabilities)
Inventory
Monetisation
£ 000
Head
office
£ 000
Consolidated Group –
continuing operations
£ 000
635
867
(4,773)
(1,037)
(4,138)
(170)
1,502
(5,810)
(4,308)
Geographical analysis
The Group’s Inventory Monetisation operation is currently predominately located in Europe, while the investment advisory operations
(classified as a discontinued operation) were predominately located in Singapore for the year ended 31 December 2022.
4 Finance costs from continuing operations
Interest expense – long-term borrowings
Interest expense – loan notes / convertible loan notes
Other interest expense
Total finance costs
2023
£ 000
38
-
45
83
2022
£ 000
13
1,969
-
1,982
Included within the interest expense related to long-term borrowings is an amount of £7,000 (2022: £nil) accrued in relation
to the TAG Unsecured Working Capital facility.
140 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
5 Other operating income from continuing operations
Gain arising on settlement of outstanding creditor balance
Interest income
Other operating income
2023
£ 000
376
31
91
498
2022
£ 000
-
6
3
9
The gain arising on settlement of outstanding creditor balance relates to the settlement agreement, dated 2 May 2023, with
an existing creditor of the Group. This settlement agreement reduced the total amount that was owed by the Group, to
this supplier, in exchange for payment of the new agreed amount by a specific date. The total amount owed to this specific
creditor prior to the settlement agreement being signed was €1,130,250. This amount was reduced to €700,000 as a result of
the negotiations proceeding the signing of the settlement agreement. This resulted in a difference of €420,250 or £376,000
which has been recorded as other operating income in the consolidated statement of comprehensive income for the year
ended 31 December 2023.
Included within the interest income is an amount of £22,000 (2022: £nil) accrued as receivable from TAG in relation to late
payments received in connection with the TAG Top-Up Shareholder Loan Agreement and the Deed of Novation signed with
TAG in connection with the TradeFlow Restructuring.
6 Operating loss
The Group’s operating loss from continuing operations for the year has been arrived at after charging (crediting):
Amortisation of internally developed IM platform (note 12)
Depreciation
Staff costs (note 8)
Professional and legal fees
Contractor costs
Insurance
Training and recruitment costs
Long-term incentive plan costs (“LTIP’s”)
2023
£ 000
74
4
1,850
1,551
215
98
5
131
2022
£ 000
47
4
2,061
2,194
274
100
4
11
In addition to the above, the Group incurred the following costs from continuing operations relating to impairment charges
and fair value adjustments as detailed below:
Impairment charges (note 12)
Fair value adjustments on investments (note 26)
Total impairment charges and fair value adjustments
2023
£ 000
384
68
452
2022
£ 000
1,078
-
1,078
141 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Consolidated Financial Statements
for the Year Ended 31 December 2023
6 Operating loss
The following acquisition related costs, impairment charges, and costs/(gains) relating to the restructuring of the TradeFlow
ownership, have been recognised in the discontinued operations:
Amortisation of intangible assets arising on acquisition (note 12)*
Acquisition related earn-out payments (note 24)
Impairment charges (note 12)
Foreign currency translation gain reclassified to comprehensive income
Profit on disposal of 81% of TradeFlow (note 26)
2023
£ 000
442
-
-
62
(718)
(214)
2022
£ 000
846
(710)
765
-
-
901
* The amortisation of intangible assets arising on acquisition in FY23 reflects the charge recognised during the period from
1 January 2023 to 30 June 2023, compared to in FY22 where the charge recognised reflects a full year of amortisation.
This reflects the fact that the TradeFlow Restructuring was finalised and completed on 30 June 2023 and TradeFlow was
deconsolidated from the Group’s results from this date.
7 Auditors’ remuneration
During the year, the Group obtained the following services from the Group’s auditor, at the costs detailed below:
Fees payable to the Company’s auditors for the audit of the consolidated
financial statements
Fees payable to the Company’s auditors and its associates for other services to
the Group:
Audit of the Companies subsidiaries
Audit fees relating to prior periods
Total audit fees
Non-audit assurance services
Total audit and non-audit assurance related services
2023
£ 000
110
20
6
136
-
136
2022
£ 000
100
34
24
158
25
183
142 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
8 Staff costs
The aggregate payroll costs (including directors’ remuneration) included within continuing operations were as follows:
Wages, salaries and other short term employee benefits
Social security costs
Post-employment benefits
Total staff costs
2023
£ 000
1,590
190
70
1,850
2022
£ 000
1,783
203
76
2,061
The aggregate payroll costs (including directors’ remuneration) included within discontinued operations were as follows:
Wages, salaries and other short term employee benefits
Social security costs
Total staff costs – discontinued operations*
2023
£ 000
337
11
348
2022
£ 000
680
27
706
* The aggregate payroll costs in FY23 included within discontinued operations reflects the costs recognised during the period
from 1 January 2023 to 30 June 2023, compared to in FY22 where the aggregate payroll costs included within discontinued
operations reflect a full year of costs. This reflects the fact that the TradeFlow Restructuring was finalised and completed on 30
June 2023 and TradeFlow was deconsolidated from the Group’s results from this date.
The average number of persons employed by the Group (including Executive Directors) during the year, analysed by category
was as follows:
Executive Directors
Finance, Risk and HR
Sales and marketing
Legal
Operations and Platform development
Total average number of people employed*
2023
No.
2
4
3
1
11
21
2022
No.
3
5
4
1
13
26
* The average number of people employed in FY23 reflects the TradeFlow staff employed for the period from 1 January 2023 to
30 June 2023, compared to in FY22 where the number of people employed reflect a full year of TradeFlow staff. This reflects the
fact that the TradeFlow Restructuring was finalised and completed on 30 June 2023 and TradeFlow was deconsolidated from
the Group’s results from this date. The average number of people employed during the year ended 31 December 2023, includes
three TradeFlow staff members classified within “Operations and Platform development” (2022: five) and one TradeFlow staff
member classified within “Executive Directors” (2022: two).
143 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Consolidated Financial Statements
for the Year Ended 31 December 2023
9 Key management personnel
Key management compensation (including directors):
Wages, salaries and short-term employee benefits
Social security costs
Post-employment benefits
Total key management compensation
2023
£ 000
1,254
115
44
1,413
2022
£ 000
1,521
111
42
1,674
Key management personnel consist of the Company leadership team and the Directors.
No retirement benefits are accruing to Company Directors under a defined contribution scheme (2022: £nil), however the
Chief Executive Officer received cash in lieu of payments to a defined contribution pension scheme of £12,420 during the
year (2022: £12,420). This was allowable under his director’s employment contract.
The Directors’ emoluments are detailed in the Remuneration Report of the Annual Report and Accounts for the year ended
31 December 2023.
144 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
10 Income tax
Tax charged in the income statement:
Current Taxation
UK Corporation tax
Foreign taxation paid/(receivable) by subsidiaries – continuing operations
2023
£ 000
2022
£ 000
-
-
-
-
-
-
The tax on loss before tax for the period is more than (2022 - more than) the standard rate of corporation tax in the UK of
23.5% (2022 - 19%).
The differences are reconciled below:
Loss before tax
Corporation tax at standard rate – 23.5% (2022:19%)
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 (timing differences)
Over provision of deferred tax in prior years
Income not taxable
Deferred tax not recognised
Differences between UK and foreign tax legislation
Total tax charge
2023
£ 000
(4,345)
(1,022)
82
912
-
-
-
28
-
-
2022
£ 000
(9,877)
(1,877)
817
1,612
-
(1)
(452)
(131)
31
(1)
In addition, unrecognised deferred tax assets relating to tax losses carried forward across the Group have not been
recognised due to uncertainty over the timing and extent of future taxable profits. The losses can be carried forward
indefinitely and have no expiry date. The total approximate tax losses carried forward across the Group as at 31 December
2023 was £20.8 million (31 December 2022: £16.8 million)
145 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Consolidated Financial Statements
for the Year Ended 31 December 2023
11 Earnings/(loss) per share
The calculation of the basic earnings/(loss) per share (“EPS”) is based on the total loss for the year of £4,345,000 (2022 — loss
£9,878,000) and on a weighted average number of ordinary shares in issue of 59,880,078,004 (2022 — 43,240,915,594). The
basic EPS is (0.0073) pence (2022 – (0.0228) pence).
The calculation of the basic earnings/(loss) per share (“EPS”) from continuing operations is based on the total loss for the year
from continuing operations of £4,160,000 (2022 — loss £7,711,000) and on a weighted average number of ordinary shares
in issue of 59,880,078,004 (2022 —43,240,915,594). The basic EPS from continuing operations is (0.0070) pence (2022 –
(0.0178) pence).
The calculation of the Basic earnings/(loss) per share (“EPS”) from discontinued operations is based on the total loss for the
year discontinued operations of £185,000 (2022 — loss £2,167,000) and on a weighted average number of ordinary shares
in issue of 59,880,078,004 (2022 — 43,240,915,594). The basic EPS from discontinued operations is (0.0003) pence (2022 –
(0.0050) pence).
The Company has share warrants and employee share scheme options in issue as at 31 December 2023, which would dilute
the earnings per share if or when they are exercised in the future. A summary of these is set out below and further details of
these share warrants and employee share options can be found in note 24.
Share warrants - issued
Share warrants – to be issued
Long-term incentive plan (“LTIP”) options
Total
31 December 2023
No.
31 December 2022
No.
9,297,651,062
9,408,179,441
2,250,000,000
-
1,095,753,404
874,783,094
12,643,404,466
10,282,962,535
No dilution per share was calculated for 2023 and 2022 as with the reported loss they are all anti-dilutive.
146 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
12 Intangible assets
Cost or valuation
At 1 January 2022
Additions
Customer
Relationships
£ 000
Brand
£ 000
CTRM
Software
£ 000
AI
Software
£ 000
Goodwill
£ 000
Internally
developed
IM
platform
£ 000
Total
£ 000
4,829
205
1,429
425
2,199
2,544 11,631
-
-
-
-
-
1,125
1,125
Reclassified to assets of disposal group held for sale
(4,829)
(205)
(1,429)
(425)
(2,199)
-
(9,087)
At 31 December 2022
Additions
At 31 December 2023
Amortisation
At 1 January 2022
Amortisation charge
-
-
-
-
-
-
-
-
-
186
401
20
44
143
309
-
-
-
43
92
Reclassified to assets of disposal group held for sale
(587)
(64)
(452)
(135)
At 31 December 2022
Amortisation charge
At 31 December 2023
Impairment
At 1 January 2022
Impairment charge
Reclassified to assets of disposal group held for sale
At 31 December 2022
Impairment charge
At 31 December 2023
Net Book Value
At 31 December 2023
At 31 December 2022
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
3,669
3,669
458
458
4,127
4,127
771
1,163
47
893
-
(1,238)
818
74
892
818
74
892
800
765
1,773
2,573
1,078
1,843
(1,565)
-
(1,565)
-
-
-
-
-
2,851
2,851
384
384
3,235
3,235
-
-
-
-
The following intangible assets arose on the acquisition of TradeFlow during the year ended 31 December 2021; Customer
relationships, Brand, Commodity Trade Risk Management (“CTRM”) software, Artificial Intelligence and back-office (“AI”)
software and Goodwill. The carrying value of these assets at the date of acquisition is shown in the table above. As at 31
December 2022, the TradeFlow operations were reclassified as discontinued operations and as such the net book value
of the intangible assets relating to the TradeFlow operations have been reclassified to assets of the disposal group held for
sale at this date. On 30 June 2023, the Group completed the TradeFlow Restructuring and as such the assets and liabilities
of TradeFlow, including the intangible assets referred to above, are no longer consolidated by the Group as of 30 June 2023.
Further details are set out in note 26.
147 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Consolidated Financial Statements
for the Year Ended 31 December 2023
12 Intangible assets
Impairment assessment – Internally developed IM Platform
The Directors considered the continued current year losses of the Group’s Italian subsidiary, to which the Internally developed
IM platform relates, and the full impairment of this intangible asset in the prior year, as an impairment indicators and therefore,
in accordance to IAS 36 (“Impairment of Assets”), considered if as at 31 December 2023, this intangible asset required further
impairment in relation the additions made during the year, or if some of the prior year impairment could be reversed.
The full going concern statement, set out in note 2, noted there is currently an absence of a historical recurring track record
relating to Inventory Monetisation transactions being facilitated by the Group’s Platform, the generation of the full range of
fees from the use of its Platform from more than a limited number of Inventory Monetisation transactions, and the Group
being cash flow positive. As such the Directors have prudently identified a material uncertainty in relation to the going
concern statement. The Directors have also concluded that these uncertainties also apply to the discounted cash flow model
used in this impairment test also. In particular, there is uncertainty that arises with respect to both the future timing and growth
rates of the forecast discounted cash flows arising from the use of the Internally developed IM Platform intangible asset.
As such, the Directors have prudently decided to continue to impair the full carrying amount of this asset as at 31 December
2023. This impairment loss may subsequently be reversed and if so, the carrying amount of the asset will be increased to the
revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount
that would have been determined had no impairment loss been recognised for the investment in prior years.
Impairment assessment – TradeFlow
The finalisation of the TradeFlow Restructuring occurred on 30 June 2023 and as a result from this date the assets and liabilities
of TradeFlow, including the intangible assets acquired in connection with the acquisition of TradeFlow in July 2021, are no
longer consolidated by the Group. As such the Group did not recognise any additional impairment charges with respect to the
TradeFlow goodwill and other acquired intangible assets during the year ended 31 December 2023. The details of the calculation
of the profit on disposal of 81% of TradeFlow recognised in these consolidated financial statements can be found in note 26.
The impairment charges recognised in the prior periods resulted from impairment tests carried out by the Directors at
previous balance sheet dates. These tests were required in accordance with IAS 36 (“Impairment of Assets”) given the Directors
had identified indicators of impairment of the TradeFlow Cash Generating Unit (“CGU”) at the respective prior balance sheet dates.
13 Trade and other receivables
Trade receivables
Other receivables
Prepayments
Total trade and other receivables
As at 31 December 2023
£ 000
As at 31 December 2022
£ 000
15
976
35
1,026
7
1,179
33
1,219
148 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
14 Receivable from related party
Receivable from related party
Interest receivable from related party
Other related party receivable
Total receivable from related party
As at 31 December 2023
£ 000
As at 31 December 2022
£ 000
772
22
53
847
-
-
-
-
Receivable from related party
This balance represents the amount receivable from TAG under the Deed of Novation which created the obligation for TAG to
settle the £2,000,000 cash payment that was due from the buyers to the Company, as a result of the sale of the 81% majority
stake in TradeFlow.
As at 31 December 2023, £1,228,000 of the £2,000,000 has been repaid by TAG to the Company. The payment has been
received through a split of £771,000 in cash, £421,000 by way of formal debt novation agreements with specific suppliers
whereby the debt held by the Group companies was novated to TAG with no recourse to the Group companies, and £36,000
by way of offset against amounts owed by the Group companies to TAG.
As set out in note 30, subsequent to 31 December 2023, and prior to the release of these financial statements, TAG had
repaid £655,000 of the remaining amounts that were outstanding at 31 December 2023 through the receipt of cash
payments and further offsets against amounts owed to TAG by the Group, leaving a remaining balance of £117,000.
Interest receivable from related party
This represents the interest that is receivable from TAG as at 30 December 2023 relating to the late payments of both the
TAG Top-Up Shareholder Loan Agreement and the Deed of Novation. These interest amounts have been calculated at a
compounding rate of 15% per annum on the overdue amounts. As at 31 December 2023, the full amount of this interest
revenue remained outstanding.
Other related party receivable
In relation to the Group debt that was formally novated to TAG in lieu of a cash payment under the Deed of Novation, as at 31
December 2023 the Group held an amount receivable from TAG on its balance sheet for the value of £53,000 (31 December
2022: £nil). This primarily related to VAT amounts on certain “proforma” invoices that were formally novated, as the VAT receivable
was yet to be recorded in the Group’s statement of financial position. As such, this amount has been recorded as being receivable
from TAG and when the “formal” invoices are issued from the supplier, this amount will be reclassified as a VAT receivable.
15 Share capital
Allotted, called up and fully paid shares
Equity
Ordinary shares of £0.00002 each
Deferred shares of £0.04000 each
2018 Deferred shares of £0.01000 each
Total
As at 31 December 2023
As at 31 December 2022
No. 000
£ 000
No. 000
£ 000
61,232,096
1,224
56,621,568
63,084
224,194
2,523
2,242
63,084
224,194
61,519,374
5,989
56,908,846
1,132
2,523
2,242
5,897
149 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Consolidated Financial Statements
for the Year Ended 31 December 2023
15 Share capital
Reconciliation of allotted, called up and fully paid shares
As at 31 December 2023
As at 31 December 2022
Ordinary shares as at 1 January
56,908,846
5,897
36,355,720
No. 000
£ 000
No. 000
New ordinary shares issued to Venus Capital in connection with
2023 Venus Subscription
New ordinary shares issued to fulfil the conversion of Open
Offer warrants
New ordinary shares issued to fulfil the conversion of Mercator
Capital Management Fund LP convertible loan notes
New ordinary shares issued to Venus Capital in connection with
the Capital Enhancement Plan
New ordinary shares issued to settle the FY21 acquisition
related earn-out payments
New ordinary shares issued in connection with Open Offer
completed during the year
New ordinary shares issued to fulfil the conversion of Venus
Capital convertible loan notes
4,500,000
110,528
-
-
-
-
-
90
2
-
-
-
-
-
-
49,508
1,400,898
14,350,000
213,526
641,710
3,897,484
£ 000
5,486
-
1
28
287
4
13
78
Total at 31 December
61,519,374
5,989
56,908,846
5,897
Details of new shares allotted during the current financial year
New ordinary shares issued to Venus Capital in connection with 2023 Venus Subscription
On 28 April 2023, the Company and Venus Capital entered into the new Subscription Agreement, pursuant to which Venus
Capital committed to subscribe for 4,500,000,000 new Subscription Shares at £0.0005 per Subscription Share. The issue of
the Subscription Shares was made over two tranches (in line with the 2023 Venus Subscription) as set out below:
> an initial tranche of 3,375,000,000 Subscription Shares for gross proceeds of £1,687,500 (or £1,603,125 net of a 5%
commission chargeable by Venus Capital). This tranche of Subscription Shares were admitted to trading on the Main
Market of the London Stock Exchange on 5 May 2023; and
> a second tranche of 1,125,000,000 Subscription Shares for proceeds of £562,500 gross (or £534,375 net a 5% commission
chargeable by Venus Capital). This tranche of Subscription Shares were admitted to trading on the Main Market of the
London Stock Exchange on 30 May 2023.
New ordinary shares issued to fulfil the conversion of Open Offer warrants
Further to the issue of new ordinary shares on the 18 August 2022 as a result of the Open Offer, the Company also issued
320,855,008 warrants to certain qualifying shareholders who participated in its open offer (the “Open Offer Warrants”).
Following the issue of the Open Offer Warrants, certain holders have elected to exercise their Open Offer Warrants and this
resulted in a total of 110,528,379 new ordinary shares being issued during the year ended 31 December 2023 in relation to
Open Offer Warrant conversion.
150 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
15 Share capital
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.
16 Trade and other payables
Trade payables
Other payables
Current portion of long-term bank borrowings
Social security and other payroll taxes due
Accruals
Contract liabilities
Accrued interest payable to related party
Total trade and other payables
As at 31 December 2023
£ 000
As at 31 December 2022
£ 000
1,314
943
192
1,566
488
59
7
4,569
2,209
747
158
977
402
94
-
4,587
151 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Consolidated Financial Statements
for the Year Ended 31 December 2023
17 Long-term borrowings
Non-current portion of long-term bank borrowings
Working capital loan due to TAG
Total long-term borrowings
As at 31 December 2023
£ 000
As at 31 December 2022
£ 000
590
250
840
748
-
748
Non- current portion of long-term bank borrowings
On 12 October 2022, Supply@ME Technologies S.r.l. entered into a new long term loan facility with Banco BPM S.p.A (the
“Banco BPM Facility”). The obligations of Supply@ME Technologies S.r.l. under the Banco BPM Facility are guaranteed by the
Company. The key commercial terms of the Banco BPM Facility include:
a) €1 million in principal amount;
b) 275 basis points over Euribor interest rate; and
c) a five-year repayment term (the final payment to be made on 11 October 2027), including an initial six months of interest
only repayments, followed by 54 months of combined principal and interest repayments.
Fees totalling €52,000 were incurred in connection with the arrangement of the Banco BPM Facility. These costs have been
capitalised and will be spread over the term of the Banco BPM Facility. The amount include in the table above represents the
non-current portion of the Banco BPM Facility. The current portion is set out in note 16 above.
Working capital loan due to TAG
On the 28 April 2 023, the Company and TAG entered into a fixed term unsecured working capital loan agreement (the
“TAG Unsecured Working Capital facility”). Under the TAG Unsecured Working Capital facility, TAG agreed to provide, subject
to customary restrictions, a facility of up to £2,800,000, in tranches up to 31 January 2024, to cover the Company’s interim
working capital and growth needs.
In conjunction with the TradeFlow Restructuring, which was completed on 30 June 2023, the £2,000,000 receivable by the
Company that was assumed by TAG from the Buyers, was offset against the current obligations of TAG under TAG Unsecured
Working Capital facility. The amendment to the TAG Unsecured Working Capital facility was agreed on 30 June 2023 and this
reduced the obligations to the Company under the TAG Unsecured Working Capital facility to up to £800,000 (the “amended
TAG Unsecured Working Capital facility”).
On 30 June 2023, the Company issued a draw down notice to TAG under the amended TAG Unsecured Working Facility for
the full £800,000 available. As at 31 December 2023, £250,000 had been received from TAG in respect of this facility (31
December 2022: £nil). The due date for repayment by the Company of amounts drawn under the amended TAG Unsecured
Working Capital facility is 1 February 2028.
Any sums drawn under the amended TAG Unsecured Working Capital facility will attract a non-compounding interest rate
of 10% per annum, and any principal amount (excluding accrued interest) outstanding on 1 February 2028 will attract a
compounding interest rate of 15% per annum thereafter. Interest will be due to be paid annually on 31 March of each
relevant calendar year. In respect of these amounts received from TAG for the year ended 31 December 2023, the Group
recognised an interest expense of £7,000 (2022:£nil), which all remained unpaid as at 31 December 2023.
As set out in note 30, subsequent to 31 December 2023, and prior to the release of these financial statements, TAG had
provided the remaining £550,000 in order to satisfy the full amount of £800,000 drawn down by the Company under the
amended TAG Unsecured Working Capital facility. Additionally on 26 March 2024, the Company and TAG signed a second
deed of amendment agreement, which allowed the full outstanding amount of the amended TAG Unsecured Working Capital
facility to be extinguished by the issue of 1,500,000,000 new ordinary shares which were issued to TAG on 28 March 2024.
152 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
17 Long-term borrowings
Loan notes and convertible loan notes
During the prior financial year ended 31 December 2022, the Group also had borrowings in the form of loan notes and
convertible loan notes. While both of these had been fully repaid as at 31 December 2022, there was activity in relation to
these balances during FY22. A summary of this activity is set out below.
Loan notes
On 29 September 2021, the Company announced it had entered into a loan note facility with Mercator Capital Management
Fund LP (“Mercator”). The balance of this loan note facilities as at 1 January 2022 was £5,732,000 and this was fully settled
during 2022 through a combination of repayments made in cash for £2,191,000 and through the issue of convertible notes
worth £4,592,000. Additionally, the Group recognised finance costs in relation to these loan notes during the year ended 31
December 2022 of £1,051,000. These finance costs were recognised on an amortised cost basis using the effective interest
rate method where the interest rate applied was 47.5%.
Convertible loan notes
The convertible loan note liability arose during FY22 as a result of the partial repayment of the loan notes of £4,592,000
through the issue of convertible loan notes. Additionally an amount of £145,000 which represented an additional interest
charge relating to the loan notes was also settled through the issue of convertible loan notes during the prior financial year
In connection with the 2023 Venus Subscription, total convertible loan notes of £418,000 were issued and Venus Capital
provided the Group with debt financing of £1,500,000 which was repayable via a convertible loan note. A total of £32,000 in
interest costs were recognised in relation to the Venus Capital convertible loan notes during FY22.
The total convertible loan note balance of £6,687,000 was then fully settled prior to 31 December 2022 through cash
repayments of £3,381,000 and the remaining balance of £3,3,06,000 being converted into ordinary shares of the Company.
153 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Consolidated Financial Statements
for the Year Ended 31 December 2023
18 Provisions
At 1 January 2022
Released to profit and loss
Provided for in the year
Payments
Actuarial (gain)/loss
At 31 December 2022
Forex retranslation adjustment
At 1 January 2023
Released to profit and loss
Provided for in the year
Payments
Acturial (gain)/loss
At 31 December 2023
Post-employment
benefits
£ 000
Provision for risks
and charges
£ 000
Provision for VAT
and penalties
£ 000
46
-
22
(8)
(22)
38
(1)
37
-
17
(13)
3
44
92
(19)
12
-
-
85
(2)
83
(28)
139
-
-
221
(20)
144
-
-
345
(8)
337
-
-
-
-
194
337
Total
£ 000
359
(39)
178
(8)
(22)
468
(11)
457
(28)
156
(13)
3
575
Post-employment benefits
Post-employment benefits include severance pay and liabilities relating to future commitments to be disbursed to employees
based on their permanence in the Company. This entirely relates to the Italian subsidiary where severance indemnities
are due to each employee at the end of the employment relationship. Post-employment benefits relating to severance
indemnities are calculated by estimating the amount of the future benefit that employees have accrued in the current
period and in previous years using actuarial techniques. The calculation is carried out by an independent actuary using the
“Projected Unit Credit Method”.
Provision for risks and charges
Provision for risks and charges includes the estimated amounts of penalties and interest for payment delays referring the tax
and social security payables recorded in the Italian subsidiary financial statements which, at the closing date, are overdue. The
increase in the current financial year is primarily due to the interest component as the interest rates in Italy have risen during
FY23 to an average at 5% during 2023 (2022: 1.5% in 2022).
Provision for VAT and penalties
In advance of the Group’s first monetisation transaction, a number of advance payments have been received by the Group’s
Italian subsidiary from potential client companies in accordance with agreed contractual terms. These payments have been
recognised as revenue in accordance with local accounting rules. These advance payments, for which an invoice has not yet
been issued, have been made exclusive of VAT. As at 31 December 2023, the Group has included a provision relating to a
potential VAT liability, including penalties, in respect of these advance payments of £196,000 (31 December 2022: £201,000).
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 2023, however
there is a contingent asset of £140,000 as at 31 December 2023 (31 December 2022: £143,000) in respect of this.
An additional amount of £144,000 was added to the provision during the second half of 2022 to reflect the fact that the Italian
intercompany invoice was issued late and this balance reflects potential VAT penalties that may arise due to the timing of the invoice.
This balance remains provided for at 31 December 2023, however has been revalued to £141,000 as at 31 December 2023.
154 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
18 Provisions
From time to time, during the course of business, the Group maybe 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 31 December 2023 that 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
£53,000 for continuing operations (2022: £55,000).
Contributions totalling £16,000 (2022: £9,000) were payable to the scheme at the end of the year and are included in
creditors. This has been paid post year end.
20 Capital commitments
There were no capital commitments for the Group at 31 December 2023 or 31 December 2022.
21 Contingent liabilities
There were no contingent liabilities for the Group at 31 December 2023 or 31 December 2022.
22 Financial instruments
Financial assets
Financial assets at amortised cost:
Cash and cash equivalents
Trade receivables
Receivable from related party
Other receivables
Carrying value
As at
31 December 2023
£ 000
Carrying value
As at
31 December 2022
£ 000
Fair value
As at
31 December 2023
£ 000
Fair value
As at
31 December 2022
£ 000
5
15
847
974
1,841
257
7
-
1,179
1,443
5
15
847
974
1,841
257
7
-
1,179
1,443
Valuation methods and assumptions: The directors believe due to their short term nature, the fair value approximates to the
carrying amount.
155 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Consolidated Financial Statements
for the Year Ended 31 December 2023
22 Financial instruments
Financial liabilities
Financial liabilities at amortised cost:
Long-term borrowings
Trade payables
Other payables
Carrying value
As at
31 December 2023
£ 000
Carrying value
As at
31 December 2022
£ 000
Fair value
As at
31 December 2023
£ 000
Fair value
As at
31 December 2022
£ 000
1,032
1,314
943
3,289
906
2,209
747
3,862
1,032
1,314
943
3,289
906
2,209
747
3,862
Valuation methods and assumptions: The directors believe that the fair value of trade and other payables approximates to the
carrying value.
There are no financial liabilities that are carried at fair value through the profit and loss as at 31 December 2023 (31
December 2022: £nil).
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 and other receivables;
> cash at bank;
> receivables from related parties;
> trade and other payables; and
> long-term borrowings.
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.
156 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
22 Financial instruments
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 from continuing operations as at 31 December 2023 comprised cash and
cash equivalents of £5,000 (2022: £257,000). Interest is paid on cash at floating rates in line with prevailing market rates. In
addition, late payment interest of £22,000 was recognised during the year ended 31 December 2023 (2022: £nil) relating to
the late payments of both the TAG Top-Up Shareholder Loan Agreement and the Deed of Novation. These interest amounts
have been calculated at a compounding rate of 15% per annum on the overdue amounts. As at 31 December 2023, the full
amount of this interest revenue remained outstanding.
The Group’s interest generating financial liabilities from continuing operations as at 31 December 2023 comprised long-term
borrowings of £1,032,000 (2022: £906,000)
Sensitivity analysis
At 31 December 2023, had the LIBOR 3 MONTH rate of 4.968 (2022 – 2.015) increased by 1% with all other variables held
constant, the increase in interest receivable on financial assets would amount to approximately £nil (2022 - £nil). Similarly,
a 1% decrease in the LIBOR 3 MONTH rate with all other variables held constant would result in a decrease in interest
receivable on financial assets of approximately £nil (2022 - £nil).
At 31 December 2023, had the EURIBOR 3 MONTH rate of 3.905 (2022 – 2.162) increased by 1% with all other variables
held constant, the increase in interest payable on financial liabilities would amount to approximately £7,000 (2022 - £9,000).
Similarly, a 1% decrease in the EURIBOR 3 MONTH rate with all other variables held constant would result in a decrease in
interest receivable on financial assets of approximately £7,000 (2022 - £9,000).
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.
In connection with the completion of the TradeFlow Restructuring, the balance of the consideration payable to the Company was
£2,000,000 and this debt to the Company was assumed by TAG from the Buyers of the 81% stake in TradeFlow. This receivable
was to be received in multiple tranches with the final payment due on 31 January 2024. Prior to agreeing to this receivable
being assumed by TAG and for it to be repaid over multiple tranches, the Board analysed the creditworthiness of TAG and
carried out due diligence including how TAG intended to source funds to make the required payments. As at 31 December 2023,
an amount of £772,000 was still outstanding in connection with this receivable from TAG, of which £272,000 was overdue
and £500,000 was due at the end of January 2024. Due to certain late payments of this receivable, the Board are closely
monitoring the creditworthiness of TAG to ensure that payments continued to be received, albeit on a delayed schedule.
The Group’s Chief Financial Officer monitors the utilisation of the credit limits regularly.
157 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Consolidated Financial Statements
for the Year Ended 31 December 2023
22 Financial instruments
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
Receivable from related party
Carrying value
as at
31 December 2023
£ 000
Maximum exposure
as at
31 December 2023
£ 000
Carrying value
as at
31 December 2022
£ 000
Maximum exposure
as at
31 December 2022
£ 000
5
15
847
867
5
15
847
867
257
7
-
264
257
7
-
264
As at 31 December 2023, the assets held by the Group have not been impaired, in particular the trade receivables and
receivable from related party are all considered to be low risk. Subsequent to 31 December 2023, 77% of the receivable from
related party has been repaid.
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 as at 31 December 2023
Financial assets
Cash and cash equivalents: Sterling
Cash: Euro
Cash: US Dollar
Cash: Singapore Dollar
Trade receivables: Sterling
Trade receivables: Euro
Trade receivables: Singapore Dollar
As at 31 December 2023
£000
As at 31 December 2022
£000
3
2
-
-
-
15
-
229
28
-
324
-
7
1
158 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
22 Financial instruments
Financial liabilities
Trade payables: Sterling
Trade payables: Euro
Trade payables: Singapore Dollar
Long-term borrowings: Sterling
Long-term borrowings: Euro
Long-term borrowings: Singapore
As at 31 December 2023
£000
As at 31 December 2022
£000
865
449
-
250
782
-
482
1,727
6
-
906
3,171
The comparative currency profile information above includes TradeFlow financial assets and liabilities as at 31 December
2022, which formed part of the of the assets/liabilities held for disposal groups within the consolidated statement of financial
position as at 31 December 2022.
Sensitivity analysis
At 31 December 2023, if Sterling had strengthened by 10% against the below currencies with all other variables held constant,
loss before tax for the year would have been approximately
> EUR: £19,000 higher (2022 - £60,000 higher)
> Singapore Dollar: £nil (2022 - £69,000 higher)
Conversely, if the below currencies had weakened by 10% with all other variables held constant, loss before tax for the year
would have been approximately:
> EURO: £19,000 lower (2022 - £60,000 lower)
> Singapore Dollar: £nil lower (2022 - £69,000 lower)
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.
As set out in note 28, the TAG Top-Up Shareholder Loan Agreement gives the Company the ability to draw down up to £3.5
million in line with specific conditions. As at 31 December 2023, the Company had issued draw down notices for £969,000
and subsequent to 31 December 2023, additional draw down notices to the value of £779,000 were issued. As such, £1.8
million remains undrawn. As at 31 December 2022, the Group had no undrawn facilities.
At 31 December 2023
Liabilities
Long-term 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
76
1,511
1,566
3,153
182
746
-
928
223
676
-
-
-
-
223
676
-
-
-
-
159 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Consolidated Financial Statements
for the Year Ended 31 December 2023
22 Financial instruments
At 31 December 2022
Liabilities
Long-term borrowings
Trade and other payables
Social security and other taxes
Total liabilities
Capital risk management
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
-
2,209
977
3,186
158
747
-
905
189
559
-
-
-
-
189
559
-
-
-
-
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 issued share
capital, share premium and all other equity reserves attributable to the equity holders of the parent.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. As explained in note 28, the Group
has currently entered into financing facilities from TAG during the year ended 31 December 2023.
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: (£3,807,000) (2022: (£2,025,000))
> Cash and cash equivalents: £5,000 (2022: £257,000)
> Share Capital £5,989,000 (2022: £5,897,000)
160 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
23 Net debt
The Group reconciliation of the movement in net debt from continuing operations is set out below:
Total
long-term borrowings
(current and
non-current portion)
£ 000
(906)
(145)
19
(1,032)
Total
£ 000
(7,016)
(3,903)
(5,187)
(1,407)
5,572
3,306
4,592
3,171
(34)
(906)
Loan notes
£ 000
(5,732)
-
-
(1,051)
2,191
-
4,592
-
-
-
Convertible
loan notes
£ 000
-
(1,500)
(5,187)
-
3,381
3,306
-
-
-
-
Total
long-term borrowings
(current and
non-current portion)
£ 000
(1,284)
(2,403)
-
(356)
-
-
-
3,171
(34)
(906)
At 1 January 2023
Net cash flows
Foreign exchange
As at 31 December 2023
At 1 January 2022
Net cash flows
Convertible loan notes issued as repayment of loan
notes, share issue costs and/or interest
Amortisation of finance costs
Cash repayments made during the year
Repayment of convertible loan notes via share issues
Repayment of loan notes via issue of convertible loan
notes
Reclassification of disposal group held for sale
Foreign exchange
As at 31 December 2022
24 Share-based payments
Share warrants issued to Mercator
During 2021 the Group entered into a funding facility with Mercator Capital Management Fund LP (“Mercator”) which included
the Group issuing loan notes in exchange for funding. These loan notes were linked to a convertible loan note facility, which
was able to be used should the Group elect not to repay any of the interest or principal relating to the loan notes in cash.
Both the loan note and convertible loan note agreements required share warrants to be issued representing 20% of the face
value of any loan notes or convertible loans issued. The warrants have a term of 3 years from issue and an exercise price of
130% of the lowest closing VWAP over the ten trading days immediately preceding the issue of the warrants. Under the terms
of amendment agreement signed with Mercator dated 26 April 2022, no further warrants were required to be issued on the
monthly repayments due following April 2022.
The total number of share warrants issued to Mercator during the years ended 31 December 2021 and 2022 was
961,832,433 (the “Mercator Warrants”). Details of the outstanding share warrants issued to Mercator are set out in the table
below. There have been no movement in these Mercator Warrants during the year ended 31 December 2023, however as
161 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Consolidated Financial Statements
for the Year Ended 31 December 2023
24 Share-based payments
announced by the Company on 23 November 2023 and further on 28 March 2024 the Company approved the transfer of
Mercator Warrants from Mercator to an independent third-party purchaser(s).
Date of issue
1 October 2021
1 November 2021
1 December 2021
4 January 2022
2 February 2022
4 March 2022
10 June 2022
Total
Number of
warrants
outstanding
Exercise price
Expiry date
443,726,031
£0.00316
1 October 2024
29,197,856
£0.00314
1 November 2024
49,867,625
£0.00184
1 December 2024
77,763,767
£0.00174
4 January 2025
79,179,799
£0.00171
2 February 2025
105,948,198
£0.00128
4 March 2025
176,149,157
£0.00085
10 June 2025
961,832,433
The total fair value of the above Mercator Warrants has been fully expensed in the prior periods. No further costs have been
recognised in the current financial year ended 31 December 2023, and none of these warrants have been converted during
the same period. During the prior financial year ended 31 December 2022, an amount of £579,000 was recognised in the
income statement relating to the fair value of the Mercator Warrants.
Share warrants issued to Venus under Capital Enhancement Plan
On the 27 April 2022, the Company announced it had entered into a subscription agreement with Venus Capital in
connection with the Group’s Capital Enhancement Plan. The subscription agreement specified that the Company was
required to issue one warrant for every two shares issued in connection with the mandatory tranches of the new shares
issues. This was a total of 3,425,000,000 share warrants. The subscription agreement specified that the Group was required
to issue one warrant for every five shares issued in connection with the optional tranches of the new shares issues. This
was a total of 1,500,000,000 share warrants. Additionally, an amount of 3,250,000,000 share warrants were issued to Venus
Capital in connection with the signing of the subscription agreement on 26 April 2022. As such the Group issued a total of
8,175,000,000 share warrants to Venus Capital during the year ended 31 December 2022, and as at the 31 December 2023,
these all remain outstanding. The initial terms of the warrants specified that they could be exercised at any time up to 31
December 2025 and have an exercise price of 0.065 pence per warrant.
As these share warrants were issued as a cost of issuing new ordinary shares to Venus Capital they fall into of scope of
IFRS 2 (“Share-based payments”). The total fair value of the above share warrants issued to Venus Capital under the Capital
Enhancement Plan was £4,795,000 and this amount has been fully recognised during 2022.
Share warrants issued to retail shareholders under the Open Offer
On 22 July 2022, the Group announced the Open Offer, giving existing shareholders the opportunity to subscribe for up to
641,710,082 new ordinary share in the Group on the basis of one Open Offer share for every 66 existing ordinary shares held
at an offer price of 0.05 pence per Open Offer share. The Open Offer closed on 17 August 2022 and on 18 August 2022, the
Group announced it would allot and issue 641,710,082 new ordinary shares to those qualifying shareholders and that this
would raise £320,855 gross (and £269,855 net of fees and expenses) for the Group.
In addition to the new ordinary share that were issued, the Group also issued 320,855,008 warrants to the qualifying
shareholders on the basis of one warrant for every two ordinary shares received as a result of the Open Offer. The initial
terms of the warrants specified that they could be exercised at any time up to 31 December 2025 and have an exercise price
of 0.065 pence per warrant.
162 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
24 Share-based payments
As these share warrants were issued as a cost of issuing the new Open Offer ordinary shares they fall into of scope of IFRS 2
(“Share-based payments”). As such, the Directors were required to determine the fair value of the equity-settled share-based
payments at the date on which they were granted. The fair value was determined using a Black-Sholes. The total fair value of the
above share warrants issued in connection with the Open Offer was £261,000 and this amount was fully recognised during 2022.
Subsequent to the issue of the Open Offer warrants, and prior to 31 December 2023, an amount of 160,036,379 (31
December 2022: 49,508,000) of these warrants have been converted in exchange for new ordinary shares and as at 31
December 2023 there is a balance of 160,818,629 Open Offer warrants which remained outstanding (31 December 2022:
271,347,008). On the exercise of the Open Offer warrants, the fair value amount is reclassified from the share-based payment
reserve to retained losses as set out in the consolidated statement of changes in equity for the year ended 31 December 2023.
Share warrants issued to Venus Capital under the 2023 Venus Subscription
On the 28 April 2023, the Company announced it had and entered into a new subscription agreement with Venus Capital, pursuant
to which Venus Capital committed to subscribe for 4,500,000,000 new ordinary shares over two tranches as set out below:
> an initial tranche of 3,375,000,000 new ordinary shares were admitted to a Standard Listing and to trading on the Main
Market on 5 May 2023; and
> a second tranche of 1,125,000,000 new ordinary shares were admitted to a Standard Listing and to trading on the Main
Market on 30 May 2023.
Under the new subscription agreement, new warrants are required to be issued to Venus Capital at a ratio of one warrant for
every two subscription shares issued under the new subscription agreement. This resulted in an obligation for the Group to issue
2,250,000,000 new warrants to Venus (“New Venus Warrants”) which existed at 31 December 2023. These new warrants are each
exercisable into one new ordinary share at a price equal to 0.065 pence per share up to a final exercise date of 31 December 2026.
As these share warrants were issued as a cost of issuing new ordinary shares to Venus Capital they fall into of scope of IFRS 2
(“Share-based payments”). As such, the Directors were required to determine the fair value of the equity-settled share-based
payments at the date on which they were granted. The fair value was determined using a Black-Sholes model which required
certain judgements to be made in determining the most appropriate inputs to be used model and the key judgemental
assumptions have been detailed in note 2. In particular, the key judgemental point was the expected volatility rate of the
Company’s share price over the relevant period prior to the grant of the warrants. The assumption applied in the model for
the warrants to be issued to Venus Capital was 88%. This was based on the actual volatility of the Company’s shares over the
historical period from March 2020 (the date of the reverse takeover) to the valuation date.
The total fair value of the above new share warrants issued to be Venus Capital under the 2023 Venus Subscription was
£1,717,000 and this amount has been fully recognised during the year ended 31 December 2023. Given this amount directly
related to the cost of issuing new ordinary shares to Venus Capital, the total amount of £1,717,000 have been offset against
the share premium balance in accordance with IAS 32 (“Financial Instruments”) and the Companies Act 2006. This amount
was offset against the related share premium that was created in connection with the relevant issue of ordinary share to
Venus Capital as set out in the consolidated statement of changes in equity for the year ended 31 December 2023.
Extension to the expiry date of the warrants issued in connection with the Open Offer carried out on 17 August
2022 and the warrants issued to Venus Capital during 2022
In connection with 2023 Venus Subscription, the final exercise date of the existing 8,175,000,000 warrants issued to Venus
Capital during 2022, under the Capital Enhancement Plan, was agreed to be extended from 31 December 2025 for 12
months to 31 December 2026, through a deed of amendment to the existing warrant instruments. This deed of amendment
was also dated 28 April 2023.
In line with the extension to the expiry date of the existing 8,175,000,000 warrants held by Venus Capital, the shareholders
who participated in the Open Offer during 2022 were asked if they would like to vote to extend the expiry date of the
warrants issued during the Open Offer from 31 December 2025 by 12 months to 31 December 2026. This resolution was
successfully passed at the 2023 Annual General Meeting, and a deed of amendment to the existing warrant instrument was
163 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Consolidated Financial Statements
for the Year Ended 31 December 2023
24 Share-based payments
signed on 23 June 2023.
As outlined above, both of these warrants had been valued previously in line with IFRS 2 (“Share-based payments”). The
modification to the expiry date has therefore also been valued in line with IFRS 2 (“Share-based payments”) with the change in
fair value calculated as the difference between the fair value of the modified equity instrument and that of the original equity
instrument, both of which are estimated at the date of the modification being 28 April 2023 for the relevant warrants held by
Venus Capital, and 23 June 2023 for this warrants issued in connection with the Open Offer.
The change in the fair value due to the extension of the expiry date on those warrants still outstanding at 31 December 2023
was £346,000. Given this amount directly related to the cost of issuing new ordinary shares in the past to Venus Capital or
under the Open Offer, an amount of £132,000 has been offset against the share premium balance in accordance with IAS 32
(“Financial Instruments”). This amount was offset against the related share premium that was created in connection with issue
of the relevant Venus Capital / Open Offer share issue. The remaining fair value amount of £214,000 has been recognised in
retained losses as set out in the consolidated statement of changes in equity for the year ended 31 December 2023.
A summary of the share warrants outstanding as at 31 December 2023 is detailed in the table below:
Share warrants issued to Mercator
Share warrants issued to Venus Capital
Share warrants to be issued to Venus Capital
Share warrants issued to retail shareholders
Total
Number of
warrants outstanding
at 31 December 2023
Number of
warrants outstanding
at 31 December 2022
961,832,433
961,832,433
8,175,000,000
8,175,000,000
2,250,000,000
-
160,818,629
271,347,008
11,547,651,062
9,408,179,441
A summary of the fair value of the share warrants issued during the period, including the change in fair value due to
modification of the terms of certain share warrants, are detailed in the table below:
Share warrants issued to Mercator
Share warrants issued to Venus
Share warrants to be issued to Venus
Share warrants issued to retail shareholders
Increase in fair value of outstanding warrants issued to Venus and retail
shareholders as a result of expiry date extension
Total
Acquisition related earn-out payments
2023
(£ 000)
-
-
1,717
-
346
2,063
2022
(£ 000)
236
4,795
-
261
-
5,292
The terms of the TradeFlow acquisition completed in July 2021 included related earn-out payments that, together with the initial
cash payment and issue of equity, form the total legal consideration agreed between the parties. Further details are set out below.
This acquisition related earn-out payments are determined by reference to pre-determined revenue milestone targets in
each of the 2021, 2022 and 2023 financial years. These payments may be forfeited by the selling shareholders should they,
in certain circumstances, no longer remain employed prior to the end of each earn-out period. As such, under the IFRS
Interpretations Committee’s interpretation of paragraph B55 of IFRS 3 (“Business Combinations”), the fair value of these
164 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
24 Share-based payments
earn-out payments have been accounted as a charge to the income statement (as deemed remuneration) rather than as
consideration. The terms of the agreements also allow this acquisition related earn-out payments to be settled in either
cash or equity at the discretion of the Company. As it is the Company’s current intention to settle these payments in equity,
they were previously fair valued at the grant date in line with IFRS 2 (“Share-based payments”) estimated using a Monte Carlo
simulation model.
During the preparation of the prior year financial statements of the Company, management applied their judgement at
the time as to the likelihood of the earn-out targets being achieved and this led the Directors to revise their previous IFRS 2
judgements, in connection with the acquisition related earn-out payments where the 2022 earn-out targets had not been
met, and the likelihood of acquisition related earn-out targets for 2023 being met was considered to be remote. As a result, as
at 31 December 2022, the share-based payment reserve in connection with the 2022 and 2023 acquisition related earn-out
payments was £nil and an amount of £883,000 was released during the financial year ended 31 December 2022 reflecting
the change in management judgement.
As the acquisition related earn-out payment for the 2021 targets was settled during July 2022, an additional amount was
added to the share-based payment reserve of £172,000 which covered the amounts to be recognised in FY22 in line with the
estimated vesting date of March 2022. As this relates to the TradeFlow operations, it has been recognised through the loss
from discontinued operations in the year ended 31 December 2022. Following the settlement of the 2021 acquisition related
earn-out payments in July 2022, as at 31 December 2022, the relevant share-based payment reserve had been released and
the corresponding increase in share capital and share premium was recognised.
As a result of the TradeFlow Restructuring that was commenced during the second half of 2022 and was completed on 30
June 2023, any future potential acquisition related earn-out payments were offset against the cash consideration agreed for
the Group’s 81% stake in TradeFlow that was disposed of. As such, no further acquisition related earn-out payments were
recognised in the current financial year being the year ended 31 December 2023.
Employee share scheme awards
October 2022 Employee share scheme
On 31 October 2022, the Group awarded an LTIP conditional on performance conditions, being the achievement of specified
Total Shareholder Return (“TSR”) (market condition) performance, as well as continued employment. The TSR performance
related to a three year period over the 2022, 2023 and 2024 financial years and the required TSR performance is set out in
the table below with the adjusted share price measurement period being the average closing mid-market price of a share
over a three month period ending on the last dealing day of the performance period:
Adjusted share price per share
Below 0.6945 pence
Equal to 0.6945 pence
1 penny or greater
Percentage of TSR award vesting
0%
25%
100%
Vesting is on a straight-line basis between target levels.
The vesting date of these share awards is 31 October 2025, and the continued employment covers up until this date. The share
awards issued to the Chief Executive Officer are subject to an additional 2 years holding period following the vesting date.
165 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Consolidated Financial Statements
for the Year Ended 31 December 2023
24 Share-based payments
For those share schemes with market related vesting conditions, the fair value is determined using the Monte Carlo model at
the grant date. The following table lists the inputs to the model used for the awards granted in the year ended 31 December
2022 based on information at the date of grant:
LTIP awards (granted on 31 October 2022)
Share price at date of grant
Award price
Volatility
Life of award
Risk free rate
Dividend yield
Fair value per award
TSR element
0.08 pence
0.002 pence
116.38%
3 years
3.34%
0%
0.0245 pence
The additional holding period applicable to the share awards issued to the Chief Executive Officer have been valued using the
Finnerty model. The following table lists the inputs to the model used for the awards granted in the year ended 31 December
2022 based on information at the date of grant:
LTIP awards (granted on 31 October 2022)
Share price at date of grant
Award price
Volatility
Life of holding period
Risk free rate
Dividend yield
Fair value per award with holding period
TSR element additional holding period
0.08 pence
0.08 pence
116.73%
2 years
3.60%
0%
0.0208 pence
These awards will be equity-settled by award of ordinary shares. The total share-based payment charge recognised in the
consolidated statement of comprehensive income for the year ended 31 December 2023 in relation to the October 2022
employee share scheme options is £60,000 (2022: £11,000). As all social security charges with respect to the share awards
will be the responsibility of the employee, no expense has been recognised by the Group in respect of these charges.
The following table summarised the movements in the number in share awards issued by the Company in October 2022:
Outstanding at 1 January
Conditionally awarded in year
Exercised
Forfeited or expired in year
Outstanding at 31 December
Exercisable at the end of the year
166 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
2023
No
874,783,094
-
-
(88,125,000)
2022
No
-
874,783,094
-
-
786,658,094
874,783,094
-
-
24 Share-based payments
May 2023 Employee share scheme
On 19 May 2023, the Group awarded its second LTIP conditional on performance conditions to certain employees, being the
achievement on continued employment and the achievement of performance conditions relating to the specified TSR (market
condition) performance (50%) and the specific GBP amount of Inventory Monetised (non market condition) (50%). Each of
the performance conditions relate to a three year period over the 2023, 2024 and 2025 financial years and the required
performance is as follows:
> with respect to the TSR element the adjusted share price measurement period is the average closing mid-market price of
a share price over a three month period ending on the last dealing day of the performance period, being 31 December
2025. If the average share price during the measurement period is 0.15p then 25% of the aware will vest, and this
increases on a straight line basis to 0.3p for 100% of vesting; and
> with respect to the GBP amount of Inventory Monetised the measurement period is by the end of the performance
period, being 31 December 2025. 25% of the award will vest if £300m of inventory is monetised (in aggregate) over
the three year performance period, increasing on a straight line to 100% of the award to vest if £400m of inventory is
monetised (in aggregate) over the same three year performance period.
The vesting date of these share awards is 19 May 2026, and the continued employment covers up until this date. The share
awards issued to the Chief Executive Officer are subject to an additional 2 years holding period following the vesting date.
For those share schemes with market related vesting conditions, the fair value is determined using the Monte Carlo model
at the grant date. For those share schemes with non-market vesting conditions, the fair value is determined using the Black
Scholes model at the grant date. The following table lists the inputs to the models used for the May 2023 share awards
granted based on information at the date of grant:
LTIP awards (granted on 19 May 2023)
Share price at date of grant
Award price
Volatility
Life of award
Risk free rate
Dividend yield
TSR element
0.14 pence
0.002 pence
119.81%
3 years
3.90%
0%
Inventory Monetisation element
0.14 pence
0.002 pence
n/a
3 years
n/a
0%
Fair value per award
0.1098 pence
0.1384 pence
The additional holding period applicable to the share awards issued to the Chief Executive Officer have been valued using
the Finnerty model. The following table lists the inputs to the model used for the awards granted during the year ended 31
December 2023 based on information at the date of grant:
LTIP awards (granted on 19 May 2023)
Share price at date of grant
Award price
Volatility
Life of award
Risk free rate
Dividend yield
TSR element
0.14 pence
0.14 pence
127.25%
2 years
3.87%
0%
Inventory Monetisation element
0.14 pence
0.14 pence
127.25%
2 years
3.87%
0%
Fair value per award
0.0924 pence
0.1165 pence
167 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Consolidated Financial Statements
for the Year Ended 31 December 2023
24 Share-based payments
These awards will be equity-settled by award of ordinary shares. The total share-based payment charge recognised
consolidated statement of comprehensive income for the year ended 31 December 2023 in relation to the May 2023
employee share scheme options was £71,000 (2022: £nil). As all social security charges with respect to the share awards will
be the responsibility of the employee, no expense has been recognised by the Group in respect of these charges.
The following table summarised the movements in the number in share awards issued by the Company in May 2023:
Outstanding at 1 January
Conditionally awarded in year
Exercised
Forfeited or expired in year
Outstanding at 31 December
Exercisable at the end of the year
25 Share issue costs
2023
No
-
343,548,435
-
(34,453,125)
309,095,310
-
2022
No
-
-
-
-
-
-
The costs relating to the various share issues that took place during the year have been netted off against the amount of
share premium that is recognised in respect of the share issue to which they directly relate. Any amounts in excess of the
share premium recognised, are taken to retained losses. Details of the share issue costs recognised during the year ended 31
December 2023 are set out in the table below.
2023 Venus Subscription warrant costs (note 24)
Other costs (legal fees, listing fees, commission cost)
Impact of extension of expiry date of warrants issued during 2022 relating to Capital
Enhancement plan and Open Offer warrants (note 24)
Total
Capital enhancement plan warrant costs (note 24)
Capital enhancement plan costs settled through issue of convertible loan notes
Open offer warrant costs (note 24)
Other costs (legal fees, listing fees, registrars’ fees)
Total
168 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
2023
(£ 000)
2023
(£ 000)
Costs recognised
in share premium
£000
Costs recognised
in retained losses
£000s
1,717
254
132
2,103
2022
(£ 000)
-
-
214
214
2022
(£ 000)
Costs recognised
in share premium
Costs recognised
in retained losses
3,204
343
247
230
4,024
1,591
-
14
-
1,605
26 Discontinued operations and TradeFlow Restructuring
During the second half of 2022, the Board of Directors of the Company began the process of the TradeFlow Restructuring,
and as such in the financial statements for the year ended 31 December 2022, it was considered that the TradeFlow
operations meet the criteria to be classified as held for sale at the balance sheet date in accordance with IFRS 5 (“Non-current
Assets Held for Sale and Discontinued Operations”). This is due to the fact that as at this date the details of the TradeFlow
Restructuring had all been agreed in principle between the parties and was expected to be completed post year-end. As a
result the TradeFlow operations were available for immediate sale in its present condition and it was highly probably that that
sale would be completed at 31 December 2022. With the classification as discontinued operations, the TradeFlow operations
have been excluded from the segmental reporting note (note 3).
Subsequently, on 30 June 2023 the Company announced that had entered into relevant binding commercial agreements
to complete the TradeFlow Restructuring. The rationale behind the completion of the TradeFlow Restructuring is to better
serve the needs of the Group’s client companies and funders of both businesses, and to create value for the Company’s
shareholders by eliminating any perception of conflicts of interest between the two businesses and provide both businesses
with greater commercial opportunities through the clear differentiation of responsibilities of the individual entities.
The TradeFlow Restructuring resulted in the Group reducing its ownership in TradeFlow from 100% to 19% by selling 81%
of the issued share capital in TradeFlow to Tom James and John Collis (the “Buyers”). The consideration for the Group’s 81%
stake in TradeFlow was £14,386,100 of which £12,386,100 was netted off against potential future amounts owed by the
Group to the Buyers under the terms of an earn-out letter relating to the original acquisition of TradeFlow in July 2021.
This resulted in a remaining £2,000,000 consideration to be receivable by the Group. On the 30 June 2023, the Group’s major
shareholder, TAG, assumed the obligation of the Buyers to pay the Company the remaining £2,000,000 by way of the Deed of
Novation. The £2,000,000 was to be repaid by TAG to SYME in multiple tranches, with the final tranche being due for payment
by 31 January 2024. In consideration for assuming the £2,000,000 obligation of the Buyers, TAG acquired 1,026,525,520
existing ordinary shares of nominal value £0.00002 each in the capital of the Company from the Buyers.
The accounting for the TradeFlow Restructuring has been reflected in the consolidated financial statements for the year
ended 31 December 2023. During the period from 1 January 2023 and up until the date of completion of the TradeFlow
Restructuring, being 30 June 2023, the TradeFlow operations continued to meet the criteria to be classified as held for sale
in accordance with IFRS 5 (“Non-current Assets Held for Sale and Discontinued Operations”). The TradeFlow operations
contributed a loss of £185,000 (inclusive of the profit on disposal of 81% of TradeFlow referred to below) in the period from 1
January 2023 to 30 June 2023.
From 30 June 2023, the assets and liabilities of TradeFlow, including the intangible assets acquired on the acquisition of
TradeFlow in July 2021, are no longer consolidated by the Group, and instead the fair value of the new 19% investment of
£352,000 was recognised on the balance sheet, together with the outstanding consideration to be received from TAG as
at 30 June 2023. The difference between these items resulted in profit on disposal of 81% of TradeFlow recorded in the
consolidated financial statements for the year ended 31 December 2023 of £718,000.
169 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Consolidated Financial Statements
for the Year Ended 31 December 2023
26 Discontinued operations and TradeFlow Restructuring
The results of the TradeFlow (discontinued) operations for the period from 1 January 2023 to 30 June 2023 are presented
below:
Revenue
Administrative expenses
Other operating income
Amortisation of intangible assets
Acquisition related earn-out
Impairment
Foreign currency translation loss reclassified to comprehensive income
Profit on disposal of 81% of TradeFlow
Operating loss
Finance costs
Loss before tax
Deferred tax credit
Loss for the period
6 months to
30 June 2023*
£ 000
684
(1,037)
24
(442)
-
-
(62)
718
(115)
(145)
(260)
75
(185)
* Represents the results for the six-month period prior to the finalisation of the TradeFlow Restructuring on 30 June 2023.
The net cash flows from the TradeFlow operations were as follows:
Net cash flow from operating activities
Net cash flow from investing activities
Net cash flow from financing activities
Net cash outflow
6 months to
30 June 2023*
£ 000
(405)
-
405
-
* Represents the cash flows for the six-month period prior to the finalisation of the TradeFlow Restructuring on 30 June 2023.
2022
£ 000
629
(1,705)
22
(846)
710
(765)
-
-
(1,955)
(356)
(2,311)
144
(2,167)
2022
£ 000
(1,228)
(1)
1,517
288
170 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
26 Discontinued operations and TradeFlow Restructuring
The calculation of the profit on disposal of 81% of TradeFlow as at 30 June 2023 is shown below:
Accounting fair value of the 81% ownership of the TradeFlow operations disposed of by the Group
Accounting fair value of 19% ownership of the TradeFlow operations retained by the Group
Less:
Accounting fair value of net assets disposed of by the Group
Profit on disposal of 81% of TradeFlow
6 months to
30 June 2023
£ 000
2,000
352
2,352
(1,634)
718
The value of the 19% ownership of the TradeFlow operations retained by the Company was calculated with reference to the
specifics set out in the TradeFlow Restructuring share purchase agreement dated 30 June 2023 (the “TradeFlow SPA”). These
specifics included:
a) The TradeFlow SPA set out the total legal consideration for the 81% of the TradeFlow business and required a cash
amount of £2,000,000 to be payable to the Company by the Buyers as a result of the TradeFlow Restructuring;
b) Based on the amount agreed in a) above, the estimated accounting fair value of 100% of the TradeFlow operations is
assumed to be £2,469,000; and
c) Based on the numbers set out in a) and b) above, the fair value of the 19% investment in TradeFlow retained by the
company as at 30 June 2023 is £469,000. Management then applied a discount of 25% to this fair value to take account of
the fact that the Group no longer controls TradeFlow operations. This discount applied is a management judgement that
will continue to be reassessed at each reporting date.
The major classes of assets and liabilities of the TradeFlow operations as at 31 December 2022 and 30 June 2023,
immediately prior to the finalisation of the TradeFlow Restructuring, are shown below:
Assets
Intangible assets
Tangible assets
Trade and other receivables
Contract assets
Cash and cash equivalents
Assets of disposal group held for sale
Liabilities
Trade and other payables
Long-term borrowings
Deferred tax liability
Liabilities of disposal group held for sale
Net assets
As at 30 June 2023*
£ 000
As at 31 December 2022
£ 000
5,841
6,283
2
174
119
305
6,441
482
3,440
885
4,807
1,634
4
101
132
324
6,844
430
3,171
960
4,561
2,283
* Represents the assets and liabilities of the TradeFlow operations as at 30 June 2023 immediately prior to the finalisation of the TradeFlow Restructuring.
171 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Consolidated Financial Statements
for the Year Ended 31 December 2023
26 Discontinued operations and TradeFlow Restructuring
TradeFlow long-term borrowings
On 1 April 2022, TradeFlow settled the outstanding unsecured loan notes earlier than the original maturity date of 23 October
2023. This involved the settlement of the principal amount of USD$1,700,000, the additional redemption premium cost of
USD $300,000 and accrued interest of USD $100,000. These long-term borrowings were replaced by a second long-term
loan facility, with the same third party, for USD $3,800,000, which has a maturity date of 31 March 2026. The replacement
long-term borrowings bears a simple fixed interest rate of 7.9% per annum and has an additional redemption premium cost
of USD$200,000 which is payable at the time the principal is repaid. In accordance with IFRS 9 (“Financial Instruments”) the
second long-term loan facility resulted in a substantial modification to the previous loan note facility.
Both the unsecured loan notes and the new loan facility include a redemption premium cost which is payable together with
the settlement of the principal amount of the facility. This redemption premium cost is recognised over the expected life of
the facility using the effective interest rate method. Due to the early settlement of the unsecured loan notes this resulted in
the unrecognised portion of the redemption premium cost being accelerated. This contributed an additional finance cost of
£122,000 during the year ended 31 December 2022.
On 22 May 2023, TradeFlow signed an additional loan agreement with the same third party as the loan agreement signed on
1 April 2022. This new loan agreement was for USD $500,000, which has a maturity date of 31 March 2026. The new long-
term borrowings bears a simple fixed interest rate of 7.9% per annum and has an additional redemption premium cost of
USD$50,000 which is payable at the time the principal is repaid. As with the existing long-term borrowings, the redemption
premium cost is recognised over the expected life of the facility using the effective interest rate method.
27 Investments
As set out in note 26, the fair value of the 19% investment in the equity instruments of TradeFlow was initially recorded having
regard to the accounting consideration received for the disposal of 81% of the Groups holding in TradeFlow as adjusted for
an appropriate discount for loss of control. At the 31 December 2023, a fair value adjustment of £68,000 was recorded on the
basis of the movement in TradeFlow’s net liabilities between 30 June 2023, the date of disposal, and the balance sheet date,
being 31 December 2023.
28 Related Party Transactions
During the year ended 31 December 2023, the following are treated as related parties:
Alessandro Zamboni
Alessandro Zamboni is the Chief Executive Officer of the Group and is also the sole director of the AvantGarde Group S.p.A
(“TAG”) as well as holding numerous directorships across companies including RegTech Open Project plc. Both of these
entities are related parties due the following transactions that took place over the current or prior financial years.
TAG and the Group’s operating subsidiaries
Alessandro Zamboni is the CEO of the Group and is also the sole director of TAG. As at 31 December 2023, TAG held 24.00%
of the total ordinary shares issued in Supply@ ME Capital plc (as at 31 December 2022: 22.5%).
Following the reverse takeover in March 2020, the Group entered into a Master Service Agreement with TAG in respect
of certain shared services to be provided to the Group. During the year ended 31 December 2023, the Group incurred
172 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
28 Related Party Transactions
expenses of £39,000 (2022: £70,000) to TAG in respect of this agreement. Additionally, during the year ended 31 December
2023, the Group incurred costs of £22,000 from TAG (2022: £nil) in relation certain ICT services provided, reimbursed TAG for
an amount of £2,400 relating to ICT costs that TAG initially incurred on behalf of the Group (2022: £nil), and had recognised
£45,000 of capitalised legal costs which had been incurred on behalf of the Group by TAG (2022: £nil).
In relation to the amounts detailed above, as at 31 December 2023 the following amounts were recognised in the
consolidated statement of financial position:
> no amounts were included in either trade receivable or trade payables as being owed by the Group to TAG (31 December
2022: £9,000 net Receivable); and
> an amount of £58,000 (2022: £nil) had been accrued as other payables in respect of those costs that had been incurred
but not yet invoiced by TAG as at 31 December 2023.
TAG and TradeFlow Restructuring
On 30 June 2023, TAG assumed the remaining £2,000,000 consideration arising from the TradeFlow Restructuring, to be
receivable by the Group from the Buyers, by way of a debt novation deed. The £2,000,000 was to be repaid by TAG to the
Company in multiple tranches, with the final tranche being due by 31 January 2024. As at 31 December 2023 an amount
of £772,000 remained outstanding from TAG in relation to this amount (31 December 2022: £nil), of which £227,000 was
overdue and £500,000 was due for payment on 31 January 2024.
The payment of the £1,228,000 received prior to 31 December 2023, was paid through a split of £771,000 in cash, £421,000
by way of formal debt novation agreements with specific suppliers whereby the debt held by the Group was novated to TAG
with no recourse to the Group, and £36,000 by way of offset against amounts owed by the Group to TAG.
In relation to the Group debt that was novated to TAG in lieu of a cash payment, as at 31 December 2023 the Group held an
amount receivable from TAG on its balance sheet for the value of £53,000 (31 December 2022: £nil). This primarily related
to VAT amounts on certain “proforma” invoices that had been novated, as the VAT receivable was yet to be recorded in the
Group’s statement of financial position. As such, this amount has been recorded as being receivable from TAG and when the
“formal” invoices are issued from the supplier, this amount will be reclassified as a VAT receivable.
The Company has been charging a late fee to TAG in terms of overdue payments of this particular receivable balance, and
this late fee is calculated at a compounding rate of 15% per annum on any amounts of the instalments not transferred to the
Company by the relevant due date, in accordance with the contractual arrangements. During the year ended 31 December
2023, the Group recognised £11,000 of interest revenue (2022: £nil) in relation to the late payments by TAG in respect of this
particular receivable balance. As at 31 December 2023, the full amount of this interest revenue remained outstanding.
As set out in note 30, subsequent to 31 December 2023, and prior to the release of these financial statements, TAG had
repaid £655,000 of the £772,000 outstanding at 31 December 2023, through the receipt of cash payments and further
offsets against amounts owed to TAG. The related late payment interest remained unpaid and continues to accrue interest.
TAG Unsecured Working Facility
On the 28 April 2023, the Company and TAG entered into a fixed term unsecured working capital loan agreement (the “TAG
Unsecured Working Capital facility”). Under the TAG Unsecured Working Capital facility, TAG agreed to provide, subject to
customary restrictions, a facility of up to £2,800,000, in tranches up to 31 January 2024, to cover the Company’s interim
working capital and growth needs. In conjunction with the TradeFlow Restructuring, which was completed on 30 June
2023, the £2,000,000 receivable by the Company that was assumed by TAG from the Buyers, was offset against the current
obligations of TAG under TAG Unsecured Working Capital facility. The amendment to the TAG Unsecured Working Capital
facility was agreed on 30 June 2023 and this reduced the obligations to the Company under the TAG Unsecured Working
Capital facility to up to £800,000 (the “amended TAG Unsecured Working Capital facility”).
The due date for repayment by the Company of amounts drawn under the TAG Unsecured Working Capital facility is 1 February
2028. Any sums drawn under the TAG Unsecured Working Capital facility will attract a non-compounding interest rate of 10% per
173 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Consolidated Financial Statements
for the Year Ended 31 December 2023
28 Related Party Transactions
annum, and any principal amount (excluding accrued interest) outstanding on 1 February 2028 will attract a compounding interest
rate of 15% per annum thereafter. Interest will be due to be paid annually on 31 March of each relevant calendar year.
On 30 June 2023, the Company issued a draw down notice to TAG under the amended TAG Unsecured Working Facility for
the full £800,000 available. As at 31 December 2023, £250,000 had been received from TAG in respect of this facility (31
December 2022: £nil). In respect of these amounts received from TAG, the Group recognised an interest expense of £7,000
(2022: £nil), which all remained unpaid as at 31 December 2023.
As set out in note 30, subsequent to 31 December 2023, and prior to the release of these financial statements, TAG had
provided the remaining £550,000 in order to satisfy the full amount of £800,000 drawn down by the Company under the
amended TAG Unsecured Working Capital facility. Additionally on 26 March 2024, the Company and TAG signed a second
deed of amendment agreement, which allowed the full outstanding amount of the amended TAG Unsecured Working Capital
facility to be extinguished by the issue of 1,500,000,000 new ordinary shares which were issued to TAG on 28 March 2024.
Top-Up Shareholder Loan Agreement
On 28 September 2023, the Company and TAG entered into an English law governed top-up unsecured shareholder loan
agreement (the “Top-Up Shareholder Loan Agreement”), pursuant to which TAG agreed to provide the Company with a
further facility of up to £3,500,000 to cover the Company’s working capital and growth needs up to 30 June 2025 (the “Top-Up
Facility”).
Details of this Top-Up Facility are set out below:
> The Company has the ability to draw down up to £3.5 million in monthly instalments over the period to 30 June 2025;
> On a monthly basis the Board will assess (acting in good faith and in its sole and absolute discretion) if the Group’s
projected cash balance on the last business day of the coming calendar month will be less than £250,000 following the
Group’s scheduled balance of receipts and payments for the next month by reference to, inter alia, the Group’s contracted
receivables, revenues and payables due for receipt or payment in the next month, the Group’s contracted fixed operating
expenditure and/or capital expenditure due for payment in the next month, the cash inflows in the next month arising
from any warrants that have been contractually exercised and any projected unrestricted cash amounts resulting from any
contractually agreed alternative equity, debt or hybrid financing (including, but not limited to, pursuant to a pre-emptive
offering of ordinary shares and a non-pre-emptive offering of ordinary shares) for such month;
> If the above assessment results in the Group’s projected cash balance on the last business day of the coming calendar
month being less than £250,000, the Company may draw down an amount under the TAG Top-Up Shareholder Loan
Agreement which is no greater than the GBP amount to ensure that the Group’s bank balances in the coming month shall
be equal to £250,000;
> Repayment of any sum drawn down under the TAG Top-Up Shareholder Loan Agreement will be due five calendar years
(calculated on the basis of a year of 360 days) from the date which funds are received by the Company subject to the
relevant draw down request;
> Any sums drawn down by the Company under the TAG Top-Up Unsecured Shareholder Loan will attract a non-
compounding interest rate of 10% per annum, and any principal amount (excluding accrued interest) outstanding on a
relevant due date shall attract a compounding rate of 15% per annum thereafter. Interest will be due to be paid annually
on 31 March of each relevant calendar year.
As at 31 December 2023, the Group had issued draw down notices to the value of £969,000 to TAG, however these
amounts had not yet been received by the Group (31 December 2022: £nil). As a result of the late payment of the amounts
drawn down by TAG, the Group recognised an interest revenue of £11,000 (2022: £nil), which all remained unpaid as at 31
December 2023.
As set out in note 30, subsequent to 31 December 2023, and prior to the issue of these financial statements, the Company
issued additional draw down notices under the Top-Up Shareholder Loan Agreement to the value of £779,000 and had
received £nil from TAG.
174 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
28 Related Party Transactions
RegTech Open Project S.p.A (“RTOP S.p.A”) and RegTech Open Project plc (“RTOP plc”)
RTOP plc is a regulatory technology company focussed on the development of an integrated risk management platform
for Banks, Insurance Companies and Large Corporations. Alessandro Zamboni is a Non-Executive Director of RTOP plc and
Albert Ganyushin is the Chair of the Board of directors of RTOP plc. TAG also is the majority ultimate beneficial shareholder of
RTOP plc. Prior to RTOP plc’s listing of its ordinary shares on the standard segment of the Official List of the Financial Conduct
Authority and to trading on the main market for listed securities of London Stock Exchange plc in August 2023, the operations
of this RTOP plc were run through RTOP S.p.A and Alessandro Zamboni was the sole director of RTOP S.p.A.
In July 2022, the Company entered into an agreement with RegTech S.p.A, pursuant to which RTOP S.p.A was engaged to build
and create a number of modules for the Company, including “data factory” (i.e., data ingestion and business rule application),
and, during the year ended 31 December 2022, £270,000 has been paid by the Company to RTOP S.p.A pursuant to that
agreement. As at 31 December 2022 there is an outstanding amount accrued by the Group of £58,000 to RTOP S.p.A in
relation to this specific agreement.
During the year ended 31 December 2023, no further activities were undertaken with RTOP S.p.A, with the exception of the
payment of the amounts that had been accrued at 31 December 2022. As such no amounts were outstanding with RTOP
S.p.A at 31 December 2023 (31 December 2022: £nil).
As part of RTOP Plc’s listing onto the main market of the London Stock Exchange in August 2023, the contract referred to
above was novated to RTOP plc.
TradeFlow Capital Management Pte. Ltd. (TradeFlow)
On 30 June 2023, TradeFlow entered into a three-year White-Label licence agreement with Supply@ME Technologies S.r.l., a
wholly owned subsidiary of the Group, with respect to use of the Platform, on a non-exclusive basis and limited to the Asia-
Pacific region, for a total consideration of £1,000,000 payable over a three-year period. As at 31 December 2023, no amounts
have been billed in respect of this contract, and no revenues have been recognised, as the two parties have been undergoing
discussions regarding the point in time when the access to the Platform will be activated.
Eight Capital Partners Plc
David Bull, an Independent Non-Executive Director and Audit Committee Chair was the CEO of Eight Capital Partners Plc from
22 June 2021 until 12 August 2022. Following the reverse takeover in March 2020, the Company entered into a Master Service
Agreement with Eight Capital Partners Plc in respect of certain shared service to be provided to the Group. This agreement
was terminated in early 2022 and as such there were no expenses in respect of this agreement with Eight Capital Partners Plc
were incurred during the year ended 31 December 2023 (year ended 31 December 2022: £3,000).
SFE Société Financière Européenne SA
During the current financial year, the Group has been collaborating with a group of private investors and subject matter
experts of working capital solutions to launch an independent Swiss-based trading business (the “the CH Trading Hub”) to
replace the Cayman-based global inventory fund (“GIF”), previously advised by TradeFlow Capital Management Pte. Ltd. The
CH Trading Hub, owned by Société Financière Européenne S.A. (“SFE”), is also expected to assume control of the independent
stock companies from the GIF once this restructuring is completed, and has purchased / set up additional stock companies
in order to manage the overall trading businesses using the Platform and the associated services provided by the Group.
Alessandro Zamboni, the CEO of SYME Group, has, along with a number of other investors, a personal non-controlling
interest in SFE. During the year ended 31 December 2023, no transactions were directly entered into between the Group and
SFE, however subsequent to 31 December 2023, and prior to the release of these financial statements, both the Group and
SFE where parties to the term sheet that was signed with respect to the commitment for the first White-Label transaction.
175 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Consolidated Financial Statements
for the Year Ended 31 December 2023
29 Controlling party
At 31 December 2023 the Directors do not believe that a controlling party exists.
30 Subsequent events
Shares issued post year relating to Open Offer Warrant Conversions
> On 11 January 2024, the Company announced the exercise of 31,055 Open Offer Warrants by certain Qualifying
Shareholders, and the issue of 31,055 Open Offer Warrant Shares.
> On 19 February 2024, the Company announced the exercise of 14,772 Open Offer Warrants by certain Qualifying
Shareholders, and the issue of 14,772 Open Offer Warrant Shares.
TAG unsecured Working Capital loan agreement
Subsequent to 31 December 2023, and prior to the release of these financial statements, TAG had provided the remaining
£550,000 in order to satisfy the full amount of £800,000 drawn down by the Company under the amended TAG Unsecured
Working Capital facility. Additionally, on 26 March 2024, the Company and TAG signed a second deed of amendment
agreement, which allowed the full outstanding amount of the amended TAG Unsecured Working Capital facility to be
extinguished by the issue of 1,500,000,000 new ordinary shares which were issued to TAG on 28 March 2024.
Top-Up Shareholder Loan Agreement
Subsequent to 31 December 2023, and prior to the release of these financial statements, the Company issued further draw down
notices to TAG for an aggregate amount of £779,000, bringing the total amount drawn down under the Top-Up Shareholder Loan
Agreement to £1.7 million. The total amount drawn remains unpaid as at the date of these financial statements.
Deed of Novation
Subsequent to 31 December 2023, and prior to the release of these financial statements, TAG had repaid £655,000 of the
£772,000 remaining outstanding at 31 December 2023, leaving an amount outstanding of £117,000. The associated late
payment interest remained outstanding and continues to accrue at the release date of the financial statements.
176 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Company Statement of Financial Position
As at 31 December 2023
Note
As at
31 December 2023
£ 000
As at
31 December 2022
£ 000
Non-current assets
Property, plant and equipment
Investments
Other non-current assets
Total non-current assets
Current assets
Trade and other receivables
Cash and cash equivalents
Receivable from related party
Total current assets
Total assets
Current liabilities
Trade and other payables
Total current assets
Non-current liabilities
Long-term borrowings
Total non-current liabilities
Total liabilities
Net (liabilities)/assets
Equity attributable to owners of the parent
Share capital
Share premium
Share-based payment reserve
Retained losses
Total equity
3
4
5
7
8
6
9
3
293
18
314
132
3
772
907
1,221
1,507
1,507
250
250
1,757
(536)
5,989
25,396
7,969
(39,890)
(536)
7
2,478
19
2,504
612
229
-
841
3,345
1,035
1,035
-
-
1,035
2,310
5,897
25,269
5,871
(34,727)
2,310
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 ended 31 December 2023 was £5,044,000 (2022: loss for the year of
£8,339,000)
The notes on pages 179–195 form an integral part of these financial statements.
The Company financials on pages 177–195 were approved and authorised for issue by the Board on 30 April 2023 and signed
on its behalf by:
Mr. Alessandro Zamboni
CEO and Executive Director
Mr. David Bull
Independent Non-Executive Director and Chair of Audit Committee
Supply@ME Capital plc - Registration number: 03936915
177 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Company Statement of Changes in Equity
for the Year Ended 31 December 2022
Notes
Share capital
£ 000
Share Premium
£ 000
Share-based
payment
reserve
£ 000
Retained
losses
£ 000
At 1 January 2022
Loss for the year
6
10
9
9
9
Issuance of new ordinary shares
Costs incurred in connection with the
issuance of new ordinary shares
Credit to equity for issue of warrants
Exercise of Open Offer warrants
Credit to equity for prior year acquisition
related earn-out payments
Settlement of prior year acquisition
related earn-out payment
Debit to equity for current year and future
acquisition related earn-out payments
Equity settled employee share-based
payment schemes
At 31 December 2022
5,486
18,171
2,018
(24,823)
-
(8,339)
2,018
(33,162)
-
5.486
406
-
-
1
-
4
-
-
-
18,171
10,396
(4,024)
-
31
-
-
-
5,292
(40)
172
695
(699)
-
-
(883)
11
-
(1,605)
-
40
-
-
-
-
5,897
25,269
5,871
(34,727)
for the Year Ended 31 December 2023
Notes
Share capital
£ 000
Share Premium
£ 000
Share-based
payment
reserve
£ 000
Retained
losses
£ 000
At 1 January 2023
Loss for the year
Issuance of new ordinary shares
Costs incurred in connection with the
issuance of new ordinary shares
Credit to equity for issue of warrants
Exercise of Open Offer warrants
Increase in fair value of previously issued
warrant
Equity settled employee share-based
payment schemes
At 31 December 2023
6
10
9
9
9
5,897
25,269
5,871
(34,727)
5,897
90
-
-
2
-
-
25,269
2,160
(1,971)
-
70
(132)
-
(5,044)
5,871
(39,771)
-
-
1,717
(95)
346
130
-
-
-
95
(214)
-
5,989
25,396
7,969
(39,890)
The notes on pages 179–195 form an integral part of these financial statements.
178 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Total
£ 000
852
(8,339)
(7,487)
10,802
(5,629)
5,292
32
172
-
(883)
11
2,310
Total
£ 000
2,310
(5,044)
(2,734)
2,250
(1,971)
1,717
72
-
130
(536)
Notes to the Company Financial Statements
for the Year Ended 31 December 2023
1 General information
2 Accounting policies
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 W1W 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.
The Company’s financial statements are presented in
Pounds Sterling, the Company’s functional and presentation
currency, and all values are rounded to the nearest
thousand pounds (£’000) except 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.
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
> 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 consolidated 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 121–176.
Going concern
These financial statements have been prepared on a going
concern basis. The Directors have assessed the Company’s
ability to continue in operational existence for the foreseeable
future. During this assessment, the Directors identified that the
going concern assessment of the Company is directly linked to
the going concern assessment of the Group.
The full going concern assessment of the Group, being the
Company and its subsidiaries, has been set out in note 2 to
the Group’s consolidated financial statements for the year
ended 31 December 2023. In particular, the going concern
assessment of the Group identified material uncertainties
which may cast significant doubt on the Group’s ability to
continue as a going concern. These material uncertainties
related to the timing and future growth rates of cash flows
from revenue generation and timing of cash flows due to the
Group under specific contractual funding arrangements in
place. Despite these factors being identified, the Directors do
however remain confident in the business model and believe
the Group could be managed in a way to allow it to meet its
ongoing commitments and obligations through mitigating
actions including cost saving measures and securing
alternative sources of funding should this be required.
As such, the Directors consider it appropriate to continue to
prepare these financial statements on a going concern basis
and have not included the adjustments that would result if the
Company and Group were unable to continue as a going concern.
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.
Unless otherwise stated, the investments in subsidiary
undertakings are stated at cost, including the costs
associated with the acquisitions, if applicable.
The value of the acquisition of Supply@ME S.r.l. during the
financial year ended 31 December 2020, and TradeFlow
Capital Management Pte. Ltd. (“TradeFlow”) during the
financial year ended 31 December 2021, 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
179 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Company Financial Statements
for the Year Ended 31 December 2023
2 Accounting policies
the acquisition of Supply@ME S.r.l. and TradeFlow. 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:
a) 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; and
b) any increases or decreases due to acquisition related earn-
out payments recognised in the Company’s subsidiaries
during the current year. Refer to the share-based payment
reserve accounting policy for further details.
Any subsidiary undertakings sold or acquired during the year
are included up to, or from, the date of acquisition or the date
of the change of control. Any profit or loss on disposal of shares
in a subsidiary entity are recognised in the profit or loss. When
control of the subsidiary is lost, and no significant influence
exists, any remaining equity holdings will be recognised as an
investment on the balance sheet and accounted for in line with
the other investment accounting policy.
The amounts due to and from subsidiaries are unsecured,
interest free and repayable on demand. The carrying amounts
of such payables or receivables are considered to be the same
as their fair values due to their short-term nature.
Other Investments
The Company measures its investments in equity
instruments, where no significant influence or control exists,
at fair value through the profit or loss.
Financial assets
Classification
Financial assets currently comprise trade and other receivables,
receivable from related party and cash and cash equivalents
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.
Impairment of financial assets
Financial assets, other than those held at fair value through
the income statement, are assessed for indicators of
impairment at each reporting end date. Financial assets are
impaired where there is objective 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, long-
term borrowings, loan notes and convertible loan notes.
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.
Long-term borrowings and loan notes
Interest bearing long-term borrowings and loan notes are
initially recorded at the proceeds received, net of direct
issue costs (including commitment fees, introducer fees and
the fair value of any warrants issued to satisfy issue costs).
Finance charges, including direct issue costs, are accounted
for on an amortised cost basis to the Company’s income
statement using the effective interest method and are added
to the carrying amount of the instrument to the extent that
they are not settled in the period in which they arise. The
carrying value of the loan notes have been adjusted to take
into account the fair value of principal repayments made
since inception.
180 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
2 Accounting policies
Convertible loan notes
Convertible loan notes that were issued by the Company in the
prior period were recorded at the fair value of the convertible
loan notes issued, net of direct issue costs including
commitment fees. Finance charges, including direct issue
costs, were accounted for on an amortised cost basis to the
income statement using the effective interest method and are
added to the carrying amount of the instrument to the extent
that they are not settled in the period in which they arise. The
carrying value of the convertible loan notes were adjusted to
take into account the fair value of those notes that have been
converted into new ordinary shares since inception.
Derecognition of financial liabilities
Financial liabilities are derecognised when the Company’s
contractual obligations expire or are discharged or cancelled.
Provisions
Provisions are recognised when the Company has a present
legal or constructive obligation as a result of a past event, it
is probable that the Company will be required to settle the
obligation and the amount can be reliably estimated.
Share-based payments
Equity-settled share-based payments relate to the warrants
issued in connection with the cost of issuing new equity, loan
notes and convertible notes during the relevant year, and
acquisition related earn-out payments.
Share warrants
Certain equity-settled share-based payments relate to the
warrants issued in connection with the cost of issuing new
equity, loan notes and convertible notes. Equity-settled
share-based payments are measured at the fair value of the
equity instruments at the grant date. The fair value excludes
the effect of non-market-based vesting conditions. Details
regarding the determination of the fair value of equity-
settled share-based transactions are set out in note 9 to
these financial statements.
The fair value determined at the grant date of the equity-
settled share-based payments relating to the warrants
issued in connection with the issue of equity are netted off
against the amount of share premium that is recognised in
respect of the share issue to which they directly relate. Any
amounts in excess of the share premium recognised, are
netted off against retained losses.
The fair value determined at the grant date of the equity-
settled share-based payments relating to the warrants
issued in connection with the issue of loan notes, convertible
loan notes or other debt instruments are netted off against
the fair value of the underlying debt instrument to which
they directly relate. The fair value is then expensed together
with the other related finance costs on an amortised cost
basis to the Company’s income statement using the effective
interest method.
If there are any subsequent modifications made to any of
the terms of equity-settled share-based payments relating to
the warrants issued by the Company, the change in fair value
is calculated as the difference between the fair value of the
modified equity-settled share-based payment and that of the
original equity-settled share-based payment. This calculation
relates to any warrants that are still outstanding and have
not been converted into ordinary shares at the time of the
subsequent modification. The change in the fair value is then
accounted on a consistent basis to the initial fair value.
In respect of the share-based payments, the fair value is not
revised at subsequent reporting dates, however, the fair
value is released from the share-based payment reserve at
the point in time that any of the warrants are exercised by
the third party holder.
Employee share schemes
Grants made to certain employees of the Company will result
in a charge recognised in the Company’s income statement.
Such grants will be measured at fair value at the date of grant
and will be expensed on a straight-line basis over the vesting
period, based on the Company’s estimate of the shares that
will eventually vest. Vesting assumptions are reviewed during
each period to ensure they reflect current expectations.
Grants made to subsidiary employees will not result in a
charge to the Company’s income statement as any charges
for share-based payments are recognised in the cost of
investment in the relevant subsidiary.
Full details of the Group’s share-base payments refer to note
24 to the Groups consolidated financial statements for the
year ended 31 December 2023.
Acquisition related earn-out payments
In addition, the Company previously recognised a share-based
payment reserve in connection with acquisition related earn-out
payments arising from the acquisition of TradeFlow. The fair
value of these earn-out payments were measured using the
same methods as outlined above. Given the service conditions
related to these payments are linked to the Company’s
subsidiaries, the share-based payment expense was recognised
by this entity. The Company recorded this amount as an
increase to the investment value and through the share-based
payment reserve. The fair value determined at the grant date of
these equity-settled share-based payments was recognised over
the vesting period on a straight-line basis, based on the estimate
181 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Company Financial Statements
for the Year Ended 31 December 2023
2 Accounting policies
of equity instruments that would eventually vest. Vesting
assumptions were reviewed during each period to ensure they
reflect current expectations and any changes required to true-
up the related share-based payment reserve were recognised
through the income statement of the Company’s subsidiary,
and the Company’s investment value and share-based payment
reserve, in the relevant period. Full details can be found in note
24 of the Group’s consolidated financial statements and note 3
to these financial statements of the Company.
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 costs associated with the share issue.
“Share-based payment” reserve represents the adjustments
to equity in respect of the fair value of outstanding share-
based payments including warrants issued in connection
with the cost of issuing new equity or debt instruments
during the relevant period, employee share schemes and
acquisition related earn-out payments.
“Retained losses” 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 income statement.
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 choice would be more appropriate. The most
significant areas where judgement and estimates have been
applied are as follows:
Judgements
Accounting for acquisition related earn-out
The terms of the agreement to acquire TradeFlow included
acquisition related earn-out payments that, together with
the initial cash payment and issue of equity, form the
total legal consideration agreed between the parties. The
acquisition related earn-out payments are determined by
reference to pre-determined revenue milestone targets in
each of 2021, 2022 and 2023. These payments may have
been forfeited by the selling shareholders should they, in
certain circumstances, no longer remain employed prior
to the end of each earn-out period. As set out in note 2 to
the Groups consolidated financial statements, the Directors
have concluded that the inclusion of the substantive post-
acquisition service conditions requires the fair value of these
earn-out payments to be accounted for a charge to the
income statement (as deemed remuneration) in the financial
statements of the entity to which the service condition
relates, rather than as consideration or part of the initial
investment made. Given that the Company disposed of 81%
of its stake in TradeFlow on 30 June 2023, there were no
acquisition related earn-out charges recognised during the
year ended 31 December 2023.
Impairment
At the end of the accounting period the Company assesses
if there are any indicators of impairment with respect to
its investments in subsidiaries and other investments. The
carrying value is determined by the use of a discounted cash
flow model of future free cash flows which involves estimates
to be made by the Directors around future cash forecasts,
discount rates etc.
Estimates
Valuation of share warrants issued
During the current financial year, the Company issued share
warrants in connection with the current years equity
funding. In the prior financial year the Company also issued
share warrants in connection with loan notes and certain
convertible loan notes alongside the issue of new equity.
As these share warrants were issued as a cost of securing
new equity investment or funding facilities by the Company
they are classified as share-based payments. As such the
Directors were required to determine the fair value of the
equity-settled share-based payments at the date on which
they were granted. Judgement was required in determining
the most appropriate inputs into the valuation models
(Black Scholes) used and the key judgemental input was
the expected volatility rate of the Company’s share price
over the relevant period. The assumptions applied in the
models were between 97% - 88% and were based the actual
volatility of the Company’s share price from the date of the
reverse takeover (being March 2020) to the date at which
the relevant valuation model was run.
182 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
2 Accounting policies
The fair value cost of those share warrants that were issued
connection with new equity funding during the financial year
ended 31 December 2023 were recognised as debits to
equity in the consolidated statement of financial position. If
the expected volatility rate was adjusted by plus 10%, then
the impact on the fair value recognised as the initial debit to
equity in the current year would have been approximately
plus £84,000. If the expected volatility rate was adjusted by
minus 10%, then the impact on the fair value recognised as
the initial debit to equity in the current year would have been
approximately minus £89,000.
The fair value cost of those share warrants that were issued
connection with new debt funding were recognised in
the consolidated income statement. There were no share
warrants issued in the financial year ended 31 December
2023 that were connected with new debt funding.
During the current year the expiry date of certain of the share
warrants, that had previously been issued in connection with the
issue of new equity during the year ended 31 December 2022,
was extended by 12 months. The Directors were required to
determine the change in the fair value of these share warrants as
a result of the modification to the expiry date. To do so, the same
valuation model (Black Scholes) was used and the change in fair
value was calculated as the difference between the fair value of
the modified share warrants and that of the original fair value.
Non-controlling discount
During the current financial year, the Company disposed
of 81% of its investment in TradeFlow. To determine the
accounting fair value of the retained 19% investment in
TradeFlow management used the specifics set out in
the TradeFlow share purchase agreement dated 30 June
2023. Further details of this calculation are set out in note
3 to these financial statements. Following this calculation,
management then applied a discount of 25% to this fair
value to take account of the fact that the Company no longer
controls the TradeFlow operations. This discount applied is a
management judgement that will continue to be reassessed
at each reporting date. If the discount rate was adjusted
by plus 10%, then the impact on the loss on disposal of
investments recognised in the income statement in the
current financial year would have been higher by £47,000.
If the discount rate was adjusted by minus 10%, then the
impact on the loss on disposal of investments recognised
in the income statement in the current financial year would
have been lower by £47,000.
183 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Company Financial Statements
for the Year Ended 31 December 2023
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 as at
31 December 2023 are as follows:
Subsidiary undertakings
Country of
incorporation Registered address
Holding
Proportion of voting
rights and shares
held 2023
Proportion of voting
rights and shares held
2022
Supply@ME S.r.l.
Supply@ME
Technologies S.r.l.
Supply@ME Stock
Company 2 S.r.l.
Supply@ME Stock
Company 3 S.r.l.
Supply@ME Limited
Italy
Italy
Italy
Italy
Legal capital
100%
Legal capital
100%
100%
100%
Via Giosuè Carducci
36, 20123, Milano,
Italy
Legal capital
N/A
Legal capital
N/A
100% (indirectly through
Supply@ME S.r.l.)
100% (indirectly through
Supply@ME S.r.l.)
England
and Wales
27/28 Eastcastle
Street, W1W 8DH,
UK
Ordinary
shares
100%
100%
TradeFlow Capital
Management Pte. Ltd.
Singapore
Tijara Pte. Ltd.
Singapore
TradeFlow Capital
Management Systems
Pte. Ltd.
Singapore
Legal capital
N/A
100%
16 Raffles Quay,
#16-02, Hong Leong
Building, Singapore
048581
Legal capital
N/A
Legal capital
N/A
85% (indirectly through
TradeFlow)
50% (indirectly through
TradeFlow)
Supply@ME S.r.l. is the Company’s operating subsidiary currently engaged in Inventory Monetisation activities in Italy. Supply@
ME Technologies S.r.l. is the Company’s operating subsidiary in Italy which was incorporated on 25 March 2022 for the
purpose of holding the Group’s intellectual property rights relating to the Inventory Monetisation Platform, together with
future developments, in a dedicated entity.
On the 24 November 2023, Supply@ME S.r.l. sold two of its 100% owned subsidiaries, Supply@ME Stock Company 2 S.r.l. and
Supply@ME Stock Company 3 S.r.l. to Société Financière Européenne S.A. (“SFE”), for consideration of €1,000 each. Prior to
the sale, both Stock Company 2 S.r.l. and Stock Company 3 S.r.l. were non-trading entities.
On 30 June 2023 the Company reduced its ownership in TradeFlow from 100% to 19% by selling 81% of the issued share
capital in TradeFlow to Tom James and John Collis (the “Buyers”) (the “TradeFlow Restructuring”), creating a clear separation
between Group’s Inventory Monetisation fintech Platform and TradeFlow’s regulated fund management business in order to
create better serve the needs of both businesses. As shown in the table above, TradeFlow owned 85% of the issued share
capital of Tijara Pte. Limited and 50% of the issued share capital of TradeFlow Capital Management Systems Pte. Limited at
the time of the TradeFlow Restructuring. Further details of the TradeFlow Restructuring are set out below.
184 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
3 Investments
Investments
As at 1 January 2022
Increase in investment of Supply@ME S.r.l. due to waiver of intercompany debt
Transfer of prior year intercompany debt impairment charge to Investments
Additions at cost - Supply@ME Technologies S.r.l.
Increase for acquisition related earn-out payments relating to 2021 earn-out targets
Reversal of acquisition related earn-out payments relating to 2022 and 2023 earn-out targets
Impairment charges – TradeFlow
As at 31 December 2022
As at 1 January 2023
Increase in investment of Supply@ME S.r.l. and Supply@ME Technologies S.r.l. due to waiver of
intercompany debt
Transfer of prior year intercompany debt impairment charge to Investments
Accounting fair value of 100% investment in TradeFlow
Accounting fair value of 19% investment in TradeFlow retained by the Company
Fair value adjustment of investment in TradeFlow
As at 31 December 2023
£000
5,426
420
(420)
9
172
(883)
(2,246)
2,478
2,478
1,166
(1,166)
(2,469)
352
(68)
293
Investment in Supply@ME S.r.l.
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 permits the investment to be carried in the
Company’s balance sheet at the nominal value of the shares issued, ignoring any associated share premium.
During the current financial year, an agreement was signed between the Company and Supply@ME S.r.l. stating that the
Company would unconditionally waive repayment of the intercompany debt to the amount of €1,000,000 (£883,000) (2022:
€500,000 / £420,000). The waiving of this debt resulted in an increase in the value of the investment in Supply@ME S.r.l. As at
31 December 2022, the Directors had fully impaired the carrying value of the full amount owed by Supply@ME S.r.l. to the Company.
As a result of the intercompany debt wavier being agreed post 31 December 2022, an amount of £883,000 was transferred from
the provision for impairment of the receivable from Supply@ME S.r.l., to the provision for impairment of the investment in
Supply@ME S.r.l. No amounts were recorded in the income statement in the current financial year as a result of this transfer.
Investment in Supply@ME Technologies S.r.l.
During the current financial year, an agreement was signed between the Company and Supply@ME Technologies S.r.l. stating
that the Company would unconditionally waive repayment of the intercompany debt to the amount of €320,000 (£283,000)
(2022: £nil). The waiving of this debt resulted in an increase in the value of the investment in Supply@ME Technologies
S.r.l. As at 31 December 2022, the Directors had fully impaired the carrying value of the full amount owed by Supply@ME
Technologies S.r.l. to the Company. As a result of the intercompany debt wavier being agreed post 31 December 2022, an
amount of £283,000 was transferred from the provision for impairment of the receivable from Supply@ME Technologies S.r.l.,
to the provision for impairment of the investment in Supply@ME Technologies S.r.l. No amounts were recorded in the income
statement in the current financial year as a result of this transfer.
185 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Company Financial Statements
for the Year Ended 31 December 2023
3 Investments
Impairment assessment relating to investment in Supply@ME S.r.l. and Supply@ME Technologies S.r.l.
As at 31 December 2022, the Directors impaired the full carrying amount of the investment in Supply@ME S.r.l. As set out
above, the additional investment in Supply@ME S.r.l. and Supply@ME S.r.l. Technologies that was added during the current
year as a result of the intercompany debt waviers, had also been fully impaired by the Directors in the prior year. As such the
value of the investment in Supply@ME S.r.l. as at 31 December 2023 was £nil (31 December 2022: £nil) and the value of the
investment in Supply@ME Technologies S.r.l. as at 31 December 2023 was £9,000 (31 December 2022: £9,000).
During the preparation of these current year financial statements for the Company, the Directors considered if there were
indicators that the previously recognised impairment loss on the investment in Supply@ME S.r.l. could be reversed. Given the
following factors, the Directors concluded this was not the currently the case:
> Supply@ME S.r.l. continued to record losses in the current year;
> the continued absence of a historical recurring track record relating to Inventory Monetisation transactions being
facilitated by the Group;
> the inability to fully establish recurring generation of the full range of fees from the use of its Platform; and
> the Group being cash flow negative.
The impairment losses recognised in the current and prior financial years may subsequently be reversed in future financial
periods, and if so, the carrying amount of the investment will be increased to the revised estimate of its recoverable amount.
The increased carrying amount should not exceed the carrying amount that would have been determined had no impairment
loss been recognised for the investment in prior years.
Investment in TradeFlow
On 1 July 2021 the Company completed the acquisition of the entire share capital of TradeFlow by way of cash and share
consideration (the “Acquisition”). As such from this date TradeFlow became a fully owned subsidiary of the Company and
formed part of the Group’s consolidated financial performance and position from this point. The Company acquired 100%
of the equity of TradeFlow for a purchase consideration of £4,000,000 which was paid in cash and the issue of 813,000,000
equity shares.
As outlined in note 2 above the value of the acquisition of TradeFlow 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 TradeFlow. In this instance FRS 102 permits the investment to be carried in the Company’s
balance sheet at the nominal value of the shares issued, ignoring any associated share premium.
In addition, during the financial years ended 31 December 2021 and 2022, the Company recognised an increase or decrease in
the carrying amount of the TradeFlow investment in connection with acquisition related earn-out payments. The increase in the
acquisition related earn-out payments relating to the 2021 earn-out targets related the fact that 2021 acquisition related earn-
out payment was settled during 2022 and an additional amount was added to the share-based payment reserve of £172,000
during the financial year ended 31 December 2022. This covered the amounts to be recognised during FY22 in line with the
estimated vesting date of March 2022. The reversal of acquisition related earn-out payments relating to 2022 and 2023 earn-
out targets of £883,000 recognised during the financial year ended 31 December 2022 reflected the underperformance of
TradeFlow during 2022 resulting in the relevant earn-out targets not being meet, and management reassessing the likelihood
of the 2023 earn-out targets being achieved as remote. As a result the share-based payment reserve created during FY21 in
relation to the 2022 and 2023 earn-out targets was reversed during the financial year ended 31 December 2022.
Further details can be found in notes 2 and 26 of the Groups consolidated financial statements for the year ended 31 December 2023.
186 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
3 Investments
TradeFlow Restructuring
On 30 June 2023 the Company announced that had entered into relevant binding commercial agreements to complete the
TradeFlow Restructuring. The TradeFlow Restructuring resulted in the Company reducing its ownership in TradeFlow from
100% to 19% by selling 81% of the issued share capital in TradeFlow to the Buyers.
Details of the consideration for the Group’s 81% stake in TradeFlow and the specifics of the TradeFlow Restructuring share
purchase agreement dated 30 June 2023 (the “TradeFlow SPA”) can be found in note 26 to the Group’s consolidated financial
statements for the year ended 31 December 2023. The TradeFlow SPA required a cash amount of £2,000,000 to be payable
to the Company, which gave estimated accounting fair value of 100% of the TradeFlow operations of £2,469,000, and a fair
value of the 19% investment in TradeFlow retained by the Company as at 30 June 2023 of £469,000. Management then
applied a discount of 25% to this fair value to take account of the fact that the Company no longer controls the TradeFlow
operations. This discount applied is a management judgement that will continue to be reassessed at each reporting date.
Fair value adjustment to investment in TradeFlow
As set out above, the fair value of the remaining 19% investment in the equity instruments of TradeFlow was initially recorded
having regard to the consideration received for the disposal of 81% of the Company’s holding in TradeFlow as adjusted for
an appropriate discount for loss of control. As at 31 December 2023, a fair value adjustment of £68,000 was recorded on the
basis of the movement in TradeFlows net liabilities between the date of disposal and the balance sheet date.
A reconciliation of the Investment in TradeFlow is set out below:
Investment in TradeFlow
As at 1 January 2022
Increase for FY21 acquisition related earn-out payments
Reversal of FY22 and FY23 acquisition related earn-out payments
Impairment charges – TradeFlow
As at 31 December 2022
As at 1 January 2023
Accounting fair value of 100% investment in TradeFlow
Accounting fair value of 19% investment in TradeFlow retained by the Company
Fair value adjustment of investment in TradeFlow
As at 31 December 2023
£000
5,426
172
(883)
2,246
2,469
2,469
(2,469)
352
(68)
284
The calculation of the loss arising on the restructuring of the TradeFlow ownership by the Company as at 30 June 2023 is
shown below:
Accounting fair value of the 81% investment in TradeFlow disposed of by the Company
Accounting fair value of 19% ownership of the TradeFlow operations retained by the Group
Less: Accounting fair value of 100% investment in TradeFlow
Loss arising on the restructuring of the TradeFlow investment
As at 30 June 2023
£000
2,000
352
2,352
(2,469)
(117)
187 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Company Financial Statements
for the Year Ended 31 December 2023
4 Trade and other receivables
Prepayments
Interest receivable from related party
Other receivables
Amounts due from Group companies
Total trade and other receivables
As at
31 December 2023
£ 000
As at
31 December 2022
£ 000
35
22
75
-
132
33
-
579
-
612
Impairment of amounts due from Group companies
During the preparation the Company’s financial statements for the year ended 31 December 2023, the Directors reviewed
the carrying value of amounts due from Group companies for indicators of impairment and/or if there were indicators that
the previously recognised impairment loss on the carrying value of amounts due from Group companies could be reversed.
In order to be prudent, and to follow a consistent approach used to determine the impairment of the Company’s investment
in Supply@ME S.r.l. and Supply@ME Technologies S.r.l. due to the factors set out in note 3, the Directors reached the
conclusion to impair the full carrying value of the specific receivable balance due from both the Company’s Italian subsidiaries
as at the 31 December 2023.
Prior to this review, the Company held a total combined amount due from Supply@ME S.r.l. and Supply@ME Technologies
S.r.l. of £2,378,000 (31 December 2022: £1,588,000). An impairment charge in respect of the amounts due from Group
companies of £1,955,000 has been recognised in the Company’s income statement for the current financial year (2022:
£689,000). The impairment charge for the year ended 31 December 2023 reflects the increase in the amounts due from
Group companies of £789,000, together with the £1,166,000 that was transferred from the provision for impairment of the
receivables from Group companies, to the provision for impairment of investments in Group companies as a result of the
intercompany debt waivers agreed in April 2023.
Interest receivable from related party
This represents the interest that is receivable from the AvantGarde Group S.p.A (“TAG”), the Group’s majority shareholder,
as at 30 December 2023 relating to the late payments of both the top-up unsecured shareholder loan agreement dated 28
September 2023 (the “Top-Up Shareholder Loan Agreement”) and the debt novation deed dated 30 June 2023 (the ‘Debt
Novation Deed”). These interest amounts have been calculated at a compounding rate of 15% per annum on the overdue
amounts. Details of both these agreements can be found in note 28 to the Group’s consolidated financial statements for the
year ended 31 December 2023.
188 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
5 Receivable from related party
Receivable from related party
Total receivable from related party
As at
31 December 2023
£ 000
As at
31 December 2022
£ 000
772
772
-
-
This balance represents the amount receivable from TAG under the Debt Novation Deed which created the obligation for
TAG to settle the £2,000,000 cash payment that was due from the Buyers to the Company, as a result of the sale of the 81%
majority stake in TradeFlow.
As at 31 December 202, £1,228,000 of the £2,000,000 had been repaid by TAG to the Company. The payment had been
received through a split of £771,000 in cash, £421,000 by way of formal debt novation agreements with specific suppliers
whereby the debt held by the Group companies was novated to TAG with no recourse to the Group companies, and £36,000
by way of offset against amounts owed by the Group companies to TAG. As outlined in note 4 above, the Company is now
charging a late fee to TAG calculated at a compounding rate of 15% per annum on any amounts of the instalments not
transferred to the Company by the relevant due date.
Of the £772,000 outstanding at 31 December 2023, £655,000 was repaid through a combination of cash and offsetting of
amounts due to TAG from Group companies prior to the issue of these financial statements. This leaves a remaining balance
of £117,000 still to be paid.
189 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Company Financial Statements
for the Year Ended 31 December 2023
6 Share capital
Allotted, called up and fully paid shares
As at 31 December 2023
As at 31 December 2022
No. 000
£ 000
No. 000
£ 000
Equity
Ordinary shares of £0.00002 each
61,232,096
1,224
56,621,568
Deferred shares of £0.04000 each
63,084
2,523
63,084
2018 Deferred shares of £0.01000 each
224,194
2,242
224,194
Total
61,519,374
5,989
56,908,846
Reconciliation of allotted, called up and fully paid shares
Ordinary shares as at 1 January
56,908,846
5,897
36,355,720
2023
2022
No. 000
£ 000
No. 000
New ordinary shares issued to Venus Capital S.A. in connection
with 2023 Venus Subscription
New ordinary shares issued to fulfil the conversion of Open
Offer warrants
New ordinary shares issued to fulfil the conversion of Mercator
Capital Management Fund LP convertible loan notes
New ordinary shares issued to Venus Capital S.A. in connection
with the Capital Enhancement Plan
New ordinary shares issued to settle the FY21 acquisition
related earn-out payments
New ordinary shares issued in connection with Open Offer
completed during 2022
New ordinary shares issued to fulfil the conversion of Venus
Capital S.A. convertible loan notes
4,500,000
110,528
-
-
-
-
-
90
2
-
-
-
-
-
-
49,508
1,400,898
14,350,000
213,526
641,710
3,897,484
1,132
2,523
2,242
5,897
£ 000
5,486
-
1
28
287
4
13
78
Total at 31 December
61,519,374
5,989
56,908,846
5,897
Details of new shares allotted during the current financial year
New ordinary shares issued to Venus Capital in connection with 2023 Venus Subscription
On 28 April 2023, the Company and Venus Capital S.A. (“Venus Capital”) entered into a new equity subscription agreement,
pursuant to which Venus Capital committed to subscribe for 4,500,000,000 new Ordinary Shares (the “Subscription Shares”)
at £0.0005 per Subscription Share (the “2023 Venus Subscription”). The issue of the Subscription Shares was made over two
tranches (in line with the 2023 Venus Subscription) as set out below:
> an initial tranche of 3,375,000,000 Subscription Shares for gross proceeds of £1,687,500 (or £1,603,125 net of a 5%
commission chargeable by Venus Capital). This tranche of Subscription Shares were admitted to trading on the Main
Market of the London Stock Exchange on 5 May 2023; and
> a second tranche of 1,125,000,000 Subscription Shares for proceeds of £562,500 gross (or £534,375 net a 5% commission
chargeable by Venus Capital). This tranche of Subscription Shares were admitted to trading on the Main Market of the
London Stock Exchange on 30 May 2023
190 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
6 Share capital
New ordinary shares issued to fulfil the conversion of Open Offer warrants
Further to the issue of new ordinary shares on the 18 August 2022 as a result of the Open Offer, the Company also issued
320,855,008 warrants to certain qualifying shareholders who participated in its open offer (the “Open Offer Warrants”).
Following the issue of the Open Offer Warrants, certain holders have elected to exercise their Open Offer Warrants and this
resulted in a total of 110,528,379 new ordinary shares being issued during the year ended 31 December 2023 in relation to
Open Offer Warrant conversions.
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.
7 Trade and other payables
Trade payables
Other payables
Social securities and other payroll taxes due
Accruals and deferred income
Accrued interest payable to related party
Amounts due to Group companies
Total trade and other payables
As at
31 December 2023
£ 000
As at
31 December 2022
£ 000
865
196
254
185
7
-
482
32
89
427
-
5
1,507
1,035
191 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Company Financial Statements
for the Year Ended 31 December 2023
8 Long-term borrowings
Working Capital loan due to TAG
Total long-term borrowings
As at
31 December 2023
£ 000
As at
31 December 2022
£ 000
250
250
-
-
This balance represents the total amount due to TAG under the unsecured working capital loan agreement that was signed
between the Company and TAG on 28 April 2023, and then subsequently amended on 30 June 2023 (the “amended TAG
Unsecured Working Capital facility”). Under the TAG Unsecured Working Capital facility, TAG agreed to provide the Company
with an unsecured working capital facility of up to £800,000.
The due date for repayment by the Company of amounts received under the amended TAG Unsecured Working Capital
facility is 1 February 2028. Any sums drawn under the amended TAG Unsecured Working Capital facility will attract a non-
compounding interest rate of 10% per annum, and any principal amount (excluding accrued interest) outstanding on 1
February 2028 will attract a compounding interest rate of 15% per annum thereafter. Interest will be due to be paid annually
on 31 March of each relevant calendar year. The interest expense recognised during the year ended 31 December 2023 in
relation to the amended TAG Unsecured Working Capital facility was £7,000 (2022: £nil). As shown in note 7 above, this all
remained unpaid as at 31 December 2023.
On 30 June 2023, the Company issued a draw down notice to TAG under the amended TAG Unsecured Working Facility for
the full £800,000 available. As at 31 December 2023, the Company had received £250,000 from TAG in respect of the draw
down made. Subsequent to 31 December 2023, and prior to the issue of these financial statements, the remaining £550,000
had been received from TAG. Additionally on 26 March 2024, the Company and TAG signed a second deed of amendment,
which allowed the full outstanding amount of the amended TAG Unsecured Working Capital facility to be extinguished by the
issue of 1,500,000,000 new ordinary shares which were issued to TAG on 28 March 2024.
During the prior financial year ended 31 December 2022, the Group also had borrowings in the form of loan notes and
convertible loan notes. While both of these had been fully repaid as at 31 December 2022, there was activity in relation to
these balances during FY22. A summary of this activity is set out below.
Loan notes
On 29 September 2021, the Company announced it had entered into a loan note facility with Mercator Capital Management
Fund LP (“Mercator”). The balance of this loan note facilities as at 1 January 2022 was £5,732,000 and this was fully settled
during 2022 through a combination of repayments made in cash for £2,191,000 or through the issue of convertible notes
worth £4,592,000. Additionally, the Company recognised finance costs in relation to these loan notes during the year ended
31 December 2022 of £1,051,000. These finance costs were recognised on an amortised cost basis using the effective
interest rate method where the interest rate applied was 47.5%.
Convertible loan notes
The convertible loan note liability arose during FY22 as a result of the partial repayment of the loan notes of £4,592,000
through the issue of convertible loan notes. Additionally an amount of £145,000 which represented an additional interest
charge relating to the loan notes was also settled through the issue of convertible loan notes during the prior financial year.
In connection with the 2023 Venus Subscription, total convertible loan notes of £418,000 were issued and Venus Capital
provided the Group with debt financing of £1,500,000 which was repayable via a convertible loan note. A total of £32,000 in
interest costs were recognised in relation to the Venus Capital convertible loan notes during FY22.
The total convertible loan note balance of £6,687,000 was then fully settled prior to 31 December 2022 through cash
repayments of £3,381,000 and the remaining balance of £3,306,000 being converted into ordinary shares of the Company.
192 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
9 Share-based payments
Share warrants issued to Mercator
The full disclosures relating to the share warrants issued to Mercator are set out in note 24 to the Group’s consolidated
financial statements for the year ended 31 December 2023. .
Share warrants issued to Venus Capital under the Capital Enhancement Plan
The full disclosures relating to the share warrants issued to Venus Capital under the Capital Enhancement Plan are set out in
note 24 to the Group’s consolidated financial statements for the year ended 31 December 2023.
Share warrants issued to retail shareholders under the Open Offer
The full disclosures relating to the share warrants issued to retail shareholders under the Open Offer are set out in note 24 to
the Group’s consolidated financial statements for the year ended 31 December 2023.
Share warrants issued to Venus Capital under 2023 Venus Subscription
The full disclosures relating to the share warrants issued to Venus Capital under the 2023 Venus Subscription are set out in
note 24 to the Group’s consolidated financial statements for the year ended 31 December 2023.
Extension to the expiry date of the warrants issued in connection with the Open Offer carried out on 17 August
2022 and the warrants issued to Venus Capital during 2022
The full disclosures relating to the extension of the expiry date of the warrants issued in connection with the Open Offer and
the warrants issued to Venus Capital during 2022 are set out in note 24 to the Group’s consolidated financial statements for
the year ended 31 December 2023.
A summary of the share warrants outstanding as at 31 December 2023 is detailed in the table below:
Share warrants issued to Mercator
Share warrants issued to Venus Capital
Share warrants issued to retail shareholders
Number of warrants
outstanding at
31 December 2023
Number of warrants
outstanding at
31 December 2022
961,832,433
961,832,433
8,175,000,000
8,175,000,000
160,818,629
271,347,008
Share warrants to be issued to Venus Capital
2,250,000,000
-
Total
11,547,651,062
9,408,179,441
193 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Notes to the Company Financial Statements
for the Year Ended 31 December 2023
9 Share-based payments
A summary of the fair value of the share warrants recorded during the period, including the change in fair value due to
modification of the terms of certain share warrants, are detailed in the table below:
Share warrants to be issued to Venus Capital
Change in fair value due to extension of expiry date of existing share
warrants issued to Venus Capital and retail shareholders in prior periods
Share warrants issued to Venus Capital
Share warrants issued to Mercator
Share warrants issued to retail shareholders
Total
Acquisition related earn-out payments
2023
£ 000
1,717
346
-
-
-
2,063
2022
£ 000
-
-
4,795
236
261
5,292
The full disclosures relating to the acquisition related earn-out payments are set out in note 24 to the Group’s consolidated
financial statements for the year ended 31 December 2023.
10 Share issue costs
The costs relating to the various share issues that took place during the year have been netted off against the amount of
share premium that is recognised in respect of the share issue to which they directly relate. Any amounts in excess of the
share premium recognised, are taken to retained losses. Details of the share issue costs recognised during the year ended 31
December 2023 are set out in the table below.
2023 Venus Subscription warrant costs (note 9)
Other costs (legal fees, listing fees, commission cost)
Impact of extension of expiry date of warrants issued during 2022 relating to
Capital Enhancement plan and Open Offer warrants (note 9)
Total
Capital enhancement plan warrant costs (note 9)
Capital enhancement plan costs settled through issue of convertible loan notes
Open offer warrant costs (note 9)
Other costs (legal fees, listing fees, registrars’ fees)
Total
194 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
2023
Costs recognised in
share premium
£ 000
2023
Costs recognised in
retained losses
£ 000 s
1,717
254
132
2,103
-
-
214
214
2022
Costs recognised in
share premium
£ 000
2022
Costs recognised in
retained losses
£ 000
3,204
343
247
230
4,024
1,591
-
14
-
1,605
11 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.
A full list of the Company’s subsidiaries and related party transactions are set out in note 28 to the Group’s consolidated
financial statements for the year ended 31 December 2023.
12 Controlling party
At 31 December 2023 the Directors do not believe that a controlling party exists.
13 Subsequent events
A full list of the Company’s subsequent events are set out in note 30 to the Group’s consolidated financial statements for the
year ended 31 December 2023.
195 Supply@ME Capital Plc Annual Report and Accounts 2023 Financial Statements
Information
Company information
Directors
David Bull
Enrico Camerinelli
Alexandra Galligan
Albert Ganyushin
Alessandro Zamboni
Registered Office
27/28 Eastcastle Street
London
W1W 8DH
Company Number
03936915
Website
www.supplymecapital.com
Company Secretary
MSP Corporate Services Limited
27/28 Eastcastle Street
London
W1W 8D
Auditors
Crowe U.K. LLP
55 Ludgate Hill
London
EC4M 7JW
197 Supply@ME Capital Plc Annual Report and Accounts 2023 Information
Glossary
Term
AGM
BBPM
Board
BuyBack
CEO
CFO
Definition
Annual General Meeting of Supply@ME Capital Plc
Banco BPM S.p.A.
The Board of Directors of Supply@ME Capital Plc
With specific reference to TradeFlow, the written notice provided by Tom James
and John Collis of their intention to exercise their rights to buy back 100% of the
share capital of TradeFlow pursuant to certain earn out arrangements entered
into in connection with the Company’s acquisition of TradeFlow in July 2021
Chief Executive Officer
Chief Financial Officer
Company or SYME or Supply@ME
Supply@ME Capital Plc
CH Trading Hub
Debt Novation Deed
ERP
FY22
FY23
FY24
An independent Swiss-based trading business which will replace the Cayman-
based global inventory fund and is in the process of assuming control of the
independent stock companies and manage the overall trading businesses
using the Platform and the associated services provided by the Group
The English law governed debt novation deed entered into between the
Company, Tom James, John Collis and TAG on 30 June 2023, pursuant to which
TAG agreed to assume the £2m million debt of Tom James and John Collis
resulting from the TradeFlow Restructuring to the Company
Enterprise Resource Planning
The financial year ended 31 December 2022
The financial year ended 31 December 2023
The financial year ended 31 December 2024
GIF or the Fund
Global Inventory Fund (Segregated Portfolios)
Group
IFRS or IAS
ICT
IM
IoT
KPIs
KRIs
The Company and its subsidiaries
UK adopted International Accounting Standards
Information and communications technology
Inventory Monetisation
Internet of things
Key Performance Indicators
Key Risk Indicators
Leadership team
Amy Benning, Alice Buxton, Mark Kavanagh, Stuart Nelson and Nicola Bonini
until her departure from the Company
LTIP
Mercator
NFT
Long Term Incentive Plan
Mercator Capital Management Fund LP
Non-Fungible Token
Open Market IM transaction
A IM transactions from the pipeline originated by the Group and funded by
third-party investors
Platform
The Supply@ME Inventory Monetisation Platform
198 Supply@ME Capital Plc Annual Report and Accounts 2023 Information
Term
Definition
PNP Regulation
QCA Code
Italian legislation Pegno Non Possessorio, introduces the concept of security
interest into Italian law
Quoted Companies Alliance Corporate Governance Code for small and
mid-sized quoted companies
Security Token Route
Tokenised inventory tradeable on authorised digital asset exchanges
SFE
TAG
TAG Unsecured Working Capital
Facility
Top-Up Shareholder Loan
Agreement
Société Financière Européenne S.A.
The AvantGarde Group S.p.A (an entity ultimately beneficially wholly-owned and
controlled by Alessandro Zamboni, Chief Executive Officer of the Company)
The English law governed top-up unsecured working capital facility entered into
on 28 April 2023 and amended on 30 June 2023 between TAG and the
Company, pursuant to which TAG agreed to provide the Company with a facility
of up to £800,000 to cover the Company’s working capital needs.
The English law governed top-up unsecured shareholder loan agreement
entered into on 28 September 2023 between TAG and the Company, pursuant
to which TAG agreed to provide the Company with a further facility of up to
£3,500,000 to cover the Company’s working capital and growth needs up to 30
June 2025
TradeFlow
TradeFlow Capital Management Pte. Limited
TradeFlow Group
TradeFlow and its subsidiaries
TradeFlow Restructuring
The disposal of 81% of the stake in TradeFlow Captial Management Pte. Limited
which was completed on 30 June 2023
VE Chain
Venus Capital
White-Label
The VeChain Foundation
Venus Capital S.A.
The service whereby banks and other financial institutions access and pay for the
use of our technology and Platform to deploy with their existing customer bases
199 Supply@ME Capital Plc Annual Report and Accounts 2023 Information