REG - Dianomi PLC - Final Results
01/05/2024 07:00
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RNS Number : 6938M Dianomi PLC 01 May 2024
Dianomi plc
("Dianomi, the "Company" or the "Group")
Final Results
Dianomi, a leading provider of native digital advertising services to premium
clients in the Business, Finance and Lifestyle sectors, announces the
Company's audited results for the year ended 31 December 2023.
Financial Headlines
· Revenue of £30.2 million for the year (FY22: £35.9 million) with
reduced traffic across our publisher base contributing to lower revenue
· Gross margin for the full year of 24.7% (FY22: 27.3%) as a result
of a previously announced contract amendment with a major publisher partner
and publisher mix
· Adjusted EBITDA* loss of £0.4 million (FY22: profit of £1.6 million),
with a return to profitability in the second half of the year
· EBITDA loss of £1.7 million (FY22: profit of £1.2 million),
including reorganisation costs of £1.1 million
· Adjusted loss per share** of 3.10 pence (FY22: earnings of 2.58
pence)
· Statutory loss per share of 9.71 pence (FY22: earnings of 1.62
pence)
· As at 31 December 2023, the Group had no borrowings and cash of £7.7
million (30 June 2023: £7.1 million, 31 December 2022: £11.7 million)
Operating Headlines
· Appointment of Ken Johnston as Head of Global sales alongside the
integration of the US and EMEA sales teams to drive collaboration and maximise
the opportunity to capture additional advertising spend
· Successfully reduced cost base by £1 million on an annualised
basis
· Good client retention with annual advertiser and publisher churn
(calculated on a revenue basis) of 6.2% (FY22: 5.5%) and 0.9% (FY22: 2.8%)
respectively
· Continued to add new publishers to our client base with the number
of publishers at year end standing at 340 (FY22: 336)
· In 2023, new clients attracted to the platform included Natixis
Investment Management, Equinix, Macquarie, Emirates, and Allianz Global
Investors and the overall number of advertisers stood at 371 (FY22: 387)
· Continued to establish Dianomi as a full format advertising
platform offering premium brands and agencies a single point of access to ad
buying across the world's premium publishers
Outlook
· Elections in the US and in a further 63 countries around the world
likely to boost traffic across the Dianomi publisher base in 2024
· Dianomi now better placed to monetise any uptick in traffic with a
substantially reduced cost base and significantly broadened product suite
· Focus on providing a single point of access to digital advertising
buying across the world's premium publishers by evolving to a full format
advertising platform and giving Dianomi the opportunity to compete for more
varied and larger marketing budgets
· Continued investment in programmatic capacity to support full
format advertising
· Balance sheet strength continues to underpin the business and
provide the ability to invest appropriately as opportunities arise
· Current year trading is in line with management expectations, with
the profitability achieved in the second half of 2023 continuing into 2024.
Rupert Hodson, CEO of Dianomi commented:
"At the headline level 2023 has been a challenging year for Dianomi and the
wider advertising industry. Digital traffic across news publications over the
course of the year reduced by between 10% to 30%. This naturally translated
into lower revenues for the business which is reflected in the results we
report today. It is important to highlight that demand from many of our
advertisers was unchanged but lower traffic levels reduced our ability to
monetise this demand. In response, during 2023 we focused on expanding our
distribution channels, scaling up both new and existing publisher
partnerships, and moving to become a full format advertising platform. These
actions together with reducing our cost base by £1m on an annualised basis
and reorganising our management and sales teams means the Group is well placed
to drive scale and profitability."
* Calculated as profit after tax before charging interest, tax, depreciation
and amortisation in the financial year, adjusted for share-based payments,
non-recurring income and costs relating to the reorganisation. This metric
provides a more comparable indication of the Group's core business performance
by removing the impact of non-trading items that are reported separately.
** Adjusted to exclude costs relating to the reorganisation, non-recurring
income, the derecognition of the deferred tax asset and share-based
payments.
The information contained within this announcement is deemed to constitute
inside information as stipulated under the Market Abuse Regulations (EU) No.
596/2014. It forms part of United Kingdom domestic law by virtue of the
European Union (Withdrawal) Act 2018. Upon the publication of this
announcement, this inside information is now considered to be in the public
domain.
For further information contact:
Dianomi Tel: +44 (0)207 802 5530
Rupert Hodson (Chief Executive Officer)
Charlotte Stranner (Chief Financial Officer)
Panmure Gordon (NOMAD and Broker) Tel: +44 (0)207 886 2500
Emma Earl/ Freddy Crossley, Corporate Finance
Rupert Dearden, Corporate Broking
Novella Communications Tel: +44 (0)203 151 7008
Tim Robertson / Safia Colebrook
About Dianomi
Dianomi, established in 2003, is a leading provider of native digital
advertising services to premium clients in the Business, Finance and Lifestyle
sectors. The Group operates from its offices in London, New York and Sydney.
The Group enables premium brands to deliver native advertisements to a
targeted audience on the desktop and mobile websites, mobile and tablet
applications of premium publishers. It provides over 350 advertisers,
including blue chip names such as abrdn, Invesco and Charles Schwab, with
access to an international audience of over 400 million devices per month
through its partnerships with over 300 premium publishers, including blue chip
names such as Reuters, CNN Business and WSJ. Adverts served are contextually
relevant to the content of the webpages on which they appear and mirror the
style of the page, which enhances reader engagement. http://www.dianom
(http://www.dianom) i.com (http://www.dianomi.com/) .
Chairman's Statement
Introduction
The business continued to face a number of market related challenges during
the year, and we believe Dianomi (the "Company" or the "Group") responded
well. The fundamentals of the business remain robust. Dianomi continues to
work with an enviable premium client base, boasting relationships with the top
global names in banking and wealth management alongside a host of leading
financial institutions. The client list is matched by the premium portfolio of
publishers from CNN Business and the Wall Street Journal to the Times. Our
financial position is underpinned by a strong balance sheet.
Despite these advantages, the fall in traffic numbers across certain
publications by up to 30%, naturally impacted the trading performance of the
business in 2023. In response, the executive management team made some
important strategic changes. Firstly, reducing the cost base by £1 million on
an annualised basis. Secondly, reorganising the structure of the business
teams and making changes to some key leadership positions. Thirdly,
recognising the importance of improving distribution channels in this market
and moving the business to becoming a full format advertising platform.
Dianomi therefore enters 2024 a more nimble and more focused business.
Our People
In March 2023, Raphael Queisser and Cabell de Marcellus, who, alongside our
CEO Rupert Hodson, founded the business, stepped down from the Board and from
their day to day roles. Dianomi is deeply grateful to both Raphael and Cabell
for their substantial contributions to the business since its inception in
2003. This was also the start of a wider number of organisational changes made
across the business. In April, Ken Johnston, who had originally helped
establish our US presence, rejoined the business after a successful run as a
sales leader at Meta. With Ken's appointment, as Head of Global Sales, came
the key decision to integrate the sales teams of the US and EMEA and
restructure the operating teams seeking greater collaboration and shared
purpose. Towards the end of the year, in November, we welcomed Paul Gibson as
an independent Non-Executive Director. Paul brings substantial operational
experience and has spent 30 years in software and related services, as well as
experience of serving on the Board's of several private and listed companies.
During the year the Board reviewed the equity incentivisation in place for
employees and were of the view that the share option plans put in place at the
time of the Company's IPO no longer met the three principles of its
remuneration strategy, namely, alignment with shareholders, and
incentivisation and retention of employees. Therefore, in order to ensure that
the senior leaders and employees were appropriately incentivised, after
consulting with significant shareholders, the Board took the decision to
cancel the existing share options and grant new share options under new share
option plans with rebased performance and extended vesting criteria alongside
a lower exercise price.
Our Strategy
Whilst a fall in traffic numbers impacted our trading performance in 2023,
strategically, the business remains well placed especially given the current
demise of the cookie as an advertising targeting tool because our platform
already provides a cookie-free solution. Critically, Dianomi occupies a
premium position in the contextual advertising space and has the platform and
technology to offer transparency on performance for publishers and advertisers
alike.
Dianomi is evolving from a native advertising platform where we serve ads into
owned and operated placements on a publisher's website based on the content of
those pages, to a full format advertising platform whereby we can offer
advertisers different types of ad formats such as video, display, podcasts and
polls as well as native. In doing so we aim to offer premium brands and
agencies a single point of access to digital advertising buying across the
world's premium publishers giving us the opportunity to compete for more
varied and larger marketing budgets. To this end, we have continued to invest
in programmatic capacity, together with broadening our suite of ad products
significantly.
In 2023, the Group continued to broaden advertiser base by enabling financial
and lifestyle ads to sit alongside each other across our full publisher
inventory. The content we serve is typically from premium advertising brands
and are vetted for quality and brand safety, meaning that the broader pool of
lifestyle content is still highly relevant for our contextual positioning with
publishing partners. Furthermore, we are increasingly moving our ads higher up
the page, creating more viewable content with in-article units and display
ads, reflecting the strength of our performance for publishers and consistent
quality of our advertisers.
ESG
We seek to operate our business in an environmentally friendly manner. We are
helped in this goal by our business model which is based on direct
relationships with publishers without the need for intermediaries which in
industry terms is known as supply path optimised and therefore more efficient,
streamlined and carbon friendly than the majority of similar platforms.
Furthermore, earlier this year we migrated from a hosted solution with
Rackspace to AWS which on average runs workloads with a much lower carbon
footprint than the average data centre.
In total, we are a company of less than 40 people and operate a hybrid home
working and office working model, with the serviced offices from which we
operate being environmentally conscious in the products they use and the
energy they consume.
We value and support the people in our business, comprised of a talented and
diverse team who value and respect difference. We remain committed to
attracting, developing, and retaining the best talent from a diverse range of
backgrounds regardless of race, ethnicity, age, gender, sexual orientation or
physical ability.
The Board operates within a robust governance framework and ensures that the
Group has a balance of diverse skills and experience to deliver our strategy
and growth objectives. The Board and its subcommittees include independent
non-executive members with varying backgrounds and experience.
Financial Overview and Outlook
We delivered revenue for the full year of £30.2 million. This was a 15.9%
decrease against the prior year and directly reflects the fall in traffic
across the Group's publisher inventory. We made a loss at adjusted EBITDA*
level of £0.4 million (unadjusted loss at EBITDA level was £1.7 million) and
an adjusted loss per share** of 3.10 pence (statutory loss per share was 9.71
pence). This was due in part to a contract amendment with one of our top
publisher partners whereby we agreed not to recoup an overpayment relating to
a guarantee under which minimum traffic levels were not met, which resulted in
the overpayment of £0.8 million being recognised as an additional cost of
sale which was in part off-set by a higher revenue share with the publisher
for second half of the year. During the first half of the year we undertook a
cost rationalisation and, while the Group returned to profitability in the
second half of the year, this rationalisation was not sufficient to offset the
cost of the contract amendment and the reduction in revenue as a result of
challenging market conditions.
Going into 2024, we believe the changes made to personnel and the way the
business is structured have had a positive impact. The election in the US and
in a further 63 countries around the world should benefit traffic numbers.
Most importantly, there is a good pipeline of publisher and advertiser
prospects which we are hopeful of converting during the course of 2024.
Lastly, I would like to thank both our shareholders for their support and the
team for their continued commitment and enthusiasm towards driving Dianomi to
achieve our goals.
Michael Kelly
Non-Executive Chairman
Chief Executive's Statement
Introduction
As a technology-led business we are constantly working to evolve the solutions
we provide to our clients and we did this successfully during 2023. While the
market environment was certainly challenging, demand from many of our premium
clients was unchanged. We represent all of the top ten largest asset managers
and seven of the top ten largest wealth management companies in the US,
similarly we represent 340 of the world's leading publishers. We continue to
turn away the majority of the companies and publishers who ask to be a part of
the Dianomi platform in order to ensure we remain a pure premium operator. We
know that many of our customers and publishers would like to place more ads
through our platform and this is why we are evolving from a native ad platform
to a full format advertising platform.
Our objective is to grow the business beyond our native roots whilst retaining
a premium, privacy first positioning. Our ability to achieve this is being
significantly enhanced by the global switch from cookies to an ID free future.
Advertisers and publishers continue to look for a solution to this seismic
change and for the premium end of the market Dianomi provides a ready-made
solution.
Operational review
The return of Ken Johnston to head global sales has had a positive impact on
the business. Uniting the sales teams in the US and EMEA has brought the
business closer together and highlighted the global nature of our business and
potential for shared opportunities and collaborations. A key goal for the
combined sales team is to maximise the opportunities for additional spend
amongst the Group's ten largest clients all of whom have substantial global
advertising budgets outside of their current spend with Dianomi.
The ability to increase the spend of existing clients is in part driven by
capacity. Dianomi is evolving to enable clients to buy both native (owned and
operated) and display (owned and operated and open market) ads. Currently, a
top ten Dianomi publisher is trialing Dianomi direct demand display ads to
their audiences, the results of which are due in Q2 2024. We have also
substantially broadened our suite of products aimed at scaling CPM sales
(where we charge the advertiser based on impressions rather than clicks)
including Canvas, Polling, Content Hubs and Podcasts.
We took the decision to allow lifestyle ads to sit alongside financial ads for
the first time on the Dianomi platform. Historically, lifestyle advertisers
were treated as a separate vertical to financial advertisers. Over time it has
become clear that our audiences are interested in both premium financial and
lifestyle content and that it is logical and commercially valuable to combine
them. This fits with the Dianomi approach to focus not on the publication but
on the interests of our audiences. Each month there are approximately 440
million readers across our premium financial publications, and we know their
interests extend well beyond business. Initially, we are serving Lifestyle ads
in just four categories: Automotive, Luxury, Technology and Travel.
We continue to develop our programmatic offering and our programmatic revenue
grew by 50% in 2023 to £1.8 million from £1.2 million. During the year we
were able to increase supply through testing a growing number of publishers
including Newsweek, MSN Money and Yahoo Finance via programmatic channels. We
believe that we have an opportunity to be the contextual partner of choice in
the direct and programmatic space within the premium end of the market.
Commercial review
Our premium publisher base increased in number over the course of 2023 and by
the end of the year we had 340 active publishers vs 336 at year end 2022 with
the majority of new publishers being Apple News publishers. Despite only
joining the Dianomi platform in 2021, CNN Business, is now our largest
publisher with plans to further extend Dianomi's presence on CNN platforms. 20
new publishers joined in 2023 including US News, Smithsonian Magazine and The
Guardian. However, the majority of our publishers experienced a drop in their
traffic volumes which lead to a reduction in the number of clicks on our ads.
Revenue per click ("RPC") was down at 55 pence in 2023 vs 64 pence in 2022
predominantly due to a change in the mix of our impressions, with more
impressions coming from Apple News publishers, which tend to command a lower
RPC.
During 2023, we had 371 active advertisers, compared to 387 in the prior year
but we continued to attract new premium brands to the platform including
Natixis Investment Managers, First Horizon Bank and CoStar Realty Investment.
Reflecting the wider market environment average spend across the top 100
advertisers on the platform reduced by 18% to £227k per annum however we did
see increased spend on the Dianomi platform from companies such as Bank of
America and abdrn.
Financial review
Group revenue decreased 15.9% to £30.2 million (2022: £35.9 million) as a
result of the decrease in traffic seen across our publisher base.
Programmatic revenue increased in the year from £1.2 million in 2022 to £1.8
million in 2023. Video revenue decreased from £1.4 million to £1.2 million.
Video revenue tends to be tied to specific campaigns. We still believe that
video represents a key growth opportunity for Dianomi and hope to report
improved progress in the current year.
Revenue from the Group's new Lifestyle segment remained static at £1.3
million (2022: £1.3 million). With the decision to enable lifestyle
advertisers across the whole of our publisher network, we hope to see the
number of lifestyle advertisers grow in the current year.
Gross margin was down 260 basis points to 24.7% predominantly due to a
contract amendment with one of our major publisher partners as a result of
minimum guaranteed traffic levels not being met by the publisher which
resulted in a one off cost of £0.8 million. The one off cost was in effect an
overpayment by Dianomi which Dianomi agreed not to recoup, in return for which
the publisher provided Dianomi with an enhanced revenue share as from 1 July
2023 and, in addition to its existing permanent ad units, additional premium
ad inventory, including a new in-article unit in line with Dianomi's strategy
of moving further up a publisher's page.
Gross profit for the period was £7.5 million (2022: £9.8 million), a 23.5%
decline on the previous year due to lower revenues and the one off cost as
described above.
We made a loss at adjusted EBITDA* level of £0.4 million (2022: profit of
£1.6 million) and a corresponding adjusted** loss per share of 3.10 pence
(2022: profit of 2.58 pence) reflecting the lower revenues and lower gross
profit. Statutory loss per share was 9.71 pence (2022: profit of 1.62 pence).
We underwent a reorganisation during the year in order to streamline the cost
base, resulting in one-off costs of £1.1 million. The Group returned to
profitability in the second half of the year and the first quarter of 2024.
We currently have no borrowings and at the end of the year we had cash of
£7.7 million vs £11.7 million at the end of 2022. Our cash position declined
during the year partly due to restructuring costs of £1.1 million associated
with the cost rationalisation programme we undertook during the first half of
the year, as well as the publisher overpayment as explained above, the losses
in the first half of the year and the unwinding of the working capital benefit
at the end of 2022 highlighted at the time of the 2022 results.
The Group is in a growth phase of its evolution and so the Board is not
proposing to recommend a dividend and instead the Group will continue to
preserve its cash resources so that it has sufficient capacity to invest in
the growth of the Group and/or take advantage of strategic opportunities
should they arise.
Outlook
As ever, I would like to thank our team, for their individual and collective
contributions during 2023. We are a people business and it is our
relationships with each other and with our clients that is the key to our
success. Going into 2024, I am confident we have a stronger suite of products
and solutions to offer our customers with which we can drive increasing scale
into the business. Trading in the first three months is in line with our
expectations and we will look to build upon that during the course of the
year.
Rupert Hodson
Chief Executive Officer
Financial Review
2023 2022 Change
Revenue (£m) 30.2 35.9 (15.9)%
Gross profit (£m) 7.5 9.8 (23.5)%
Gross margin 24.7% 27.3% (9.5)%
Adjusted EBITDA* (£m) (0.4) 1.6 £(2.0)
Adjusted (loss)/profit before tax* (£m) (0.5) 1.5 £(2.0)
Adjusted EPS* (p) (3.10) 2.58 (5.68)p
Net cash (£m) 7.7 11.7 (34.2)%
* In order to provide better clarity to the underlying performance of the
Group, Dianomi uses adjusted EBITDA, adjusted profit before tax and adjusted
EPS as alternative performance measures. Please refer to notes 8 and 13 for
further details.
Basis of Preparation
The financial statements, for the year ended 31 December 2023 together with
the comparative period data for the year ended 31 December 2022, are prepared
in accordance with International Financial Reporting Standards adopted by the
UK.
Revenue
Revenue decreased 15.9% to £30.2 million (2022: £35.9 million),
predominantly due to lower traffic levels across the publisher base and a
lower level of revenue being generated from new publishers coming on to the
platform during the year compared to previous years.
Programmatic revenue increased to £1.8 million compared to £1.2 million in
2022 as we increased our capacity to buy additional publisher inventory via
programmatic means. Video revenue decreased from £1.4 million in the year to
31 December 2022 to £1.2 million.
Revenue from the Group's Lifestyle segment amounted to £1.3 million (2022:
£1.3 million). With the decision to enable lifestyle advertisers across the
Group's entire publisher base, both financial and lifestyle, this segment
should show growth in the current year.
Gross profit and margin
Gross profit represents the Group's share of revenue from publishers under the
terms of the revenue share agreements that the Group has with them. Gross
profit decreased 23.5% to £7.5 million from £9.8 million, representing a
gross margin of 24.7% (2022: 27.3%). The decrease was largely due to the
one-off cost of £0.8 million relating to a contract amendment with one of the
Group's largest publishers in the first half of the year which resulted from
minimum guaranteed traffic levels not being met by the publisher. The one-off
cost was in effect an overpayment by Dianomi which Dianomi agreed not to
recoup in return for an enhanced revenue share as from 1 July 2023 and, in
addition to its existing permanent ad units, additional premium ad inventory,
including a new in-article unit.
Also contributing to the lower gross margin was the mix of publishers, with a
larger contribution from CNN Business which is now the largest publisher for
the Group, but which is on a lower revenue share than average in favour of the
publisher, though Dianomi's share increases as revenue grows.
Administrative expenses
Administrative expenses decreased to £8.3 million in the year to 31 December
2023 from £9.0 million in 2022. Included in administrative expenses were
share-based payments of £0.3 million (2022: £0.5 million). During the year
the Board took the decision to cancel the existing share options and grant new
share options under new share option plans with rebased performance and
extended vesting criteria alongside a lower exercise price. The decrease in
administrative expenses is due to the reorganisation undertaken by the Group
during the year to rationalise its cost base. As a result of this
reorganisation, staff costs, which represent the largest cost within
administrative expenses, decreased to £4.5 million from £5.2 million in
previous year. However, the reorganisation meant that the Group incurred
one-off costs of £1.1 million in the year (2022: £nil).
The Group does not capitalise costs relating to the ongoing support and
development of its platform, these are included within administrative expenses
as they relate to the maintenance and enhancement of its ongoing operations,
and therefore do not meet the capitalisation criteria.
Group profitability
As a result of both lower revenues and gross profit, the Group generated a
loss at adjusted EBITDA level of £0.4 million compared to a profit of £1.6
million in 2022. To provide a better guide to the underlying business
performance, adjusted EBITDA excludes share-based payments, other,
non-recurring income and costs relating to the reorganisation along with
depreciation, amortisation, interest and tax from the measure of profit.
The Group made a loss before tax of £1.8 million and a loss after tax of
£2.9 million (2022: profit of £1.1 million and £0.5 million respectively).
Net finance income
Net finance income was £0.1 million compared to net finance income of £0.04
million in 2022, reflecting the higher interest rate environment. The Group is
debt-free and has no interest rate exposure.
Taxation
The Group had a tax charge for the year ended 31 December 2023 of £1.1
million (2022: £0.7 million) representing the tax payable in relation to the
Group's US subsidiary and the derecognition of the deferred tax asset. For
further detail on taxation see notes 11 and 12 of the Financial Statements.
Adjusted loss after tax, used in calculating adjusted earnings per share, is
shown after adjustments for the applicable tax on adjusting items as set out
in notes 8 and 13.
Earnings per share
Loss per share for the year ended 31 December 2023 was 9.71 pence (2022:
earnings of 1.62 pence). Adjusted loss per share was 3.10 pence (2022:
earnings of 2.58 pence). Adjusting items and their tax impacts are set out in
note 13.
Diluted loss per share for the year ended 31 December 2023 was 9.71 pence
(2022: earnings of 1.46 pence). Adjusted diluted loss per share was 3.10 pence
(2022: earnings of 2.34 pence). As at 31 December 2023, 1,420,017 share
options were outstanding (31 December 2022: 1,721,551) following the
cancellation of the option plans implemented at IPO and introduction of the
new option plans in November 2023.
Statement of Financial Position
Net assets as at 31 December 2023 totalled £8.6 million (31 December 2022:
£11.8 million). Trade receivables increased to £8.1 million (31 December
2022: £7.5 million) and trade creditors increased to £4.2 million as at 31
December 2023 (31 December 2022: £3.0 million). Accruals, which predominantly
reflect the payments due to the Group's publisher partners, decreased to £3.0
million as at 31 December 2023 from £4.5 million as at 31 December 2022.
The Group's net cash position decreased 34.2% to £7.7 million as at 31
December 2023 (31 December 2022: £11.7 million). The Group used cash during
the year due to the unwinding of the working capital benefit at the end of
2022 as flagged in the 2022 Annual Report, the one-off costs incurred in
relation to the reorganisation and the contract amendment with one of the
Group's major publisher partners. Net cash outflow from operations was £3.2
million in 2023 (2022: net cash inflow of £1.0 million) with £0.9 million of
tax paid in the year in relation to the Group's US operations, including
amounts due from 2022 and payments on account in relation to 2024, which
resulted in overpayments which will be put towards the Group's 2024 tax
liability. The Group is debt-free.
Charlotte Stranner
Chief Financial Officer
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Year Year
ended ended
31 Dec 2023 31 Dec 2022
£000 £000
Note
Revenue 4 30,154 35,915
Cost of sales (22,702) (26,127)
--------------------------------------------------- ---------------------------------------------------
Gross profit 7,452 9,788
Administrative expenses 7 (8,329) (8,981)
Other gains and losses - 136
Reorganisation costs 3&8 (1,054) -
Other income 6 - 167
---------------------------------------------------- -----------------------------------------------------
Operating (loss)/profit (1,931) 1,110
Depreciation 14 213 107
Share-based payments 24 312 526
Reorganisation costs 3&8 1,054 -
Other income 6 - (167)
------------------------------- -------------------------------
Adjusted EBITDA (352) 1,576
Finance income 10 115 41
Finance expense 10 (3) (4)
------------------------------------------------- -----------------------------------------------------
(Loss)/profit on ordinary activities before taxation (1,819) 1,147
Taxation 11 (1,097) (662)
------------------------------------------------- -----------------------------------------------------
(Loss)/profit for the year (2,916) 485
Other comprehensive (loss)/income items that may be reclassified subsequently (600) 651
to profit or loss
Currency translation differences
------------------------------------------------- ---------------------------------------------------
(3,516) 1,136
Total comprehensive (loss)/income for the year attributable to the owners of
the company
================================================= ==================================================
Basic (loss)/earnings per ordinary share (p) 13 (9.71) 1.62
Diluted (loss)/earnings per ordinary share (p) 13 (9.71) 1.46
All operations are continuing operations.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at As at
31 Dec 31 Dec
2023 2022
£000 £000
Note
Non-current assets
Right-of-use asset 14 - 213
--------------------------------------------------- ---------------------------------------------------
Total non-current assets - 213
Current assets
Trade and other receivables 16 8,339 7,874
Deferred tax asset 12 - 675
Corporation tax receivable 145 -
Cash and cash equivalents 17 7,740 11,663
------------------------------------------------------ ------------------------------------------------------
Total current assets 16,224 20,212
Total assets 16,224 20,425
Current liabilities
Trade and other payables 18 (7,641) (8,048)
Corporation tax payable - (371)
Lease liabilities 19 - (219)
------------------------------------------------------ ------------------------------------------------------
Total current liabilities (7,641) (8,638)
----------------------------------------------------- -----------------------------------------------------
Total liabilities (7,641) (8,638)
==================================================== ====================================================
Net assets 8,583 11,787
==================================================== ====================================================
Equity
Share capital 23 60 60
Share premium account 5,436 5,436
Share options reserve 3,692 3,380
Foreign currency reserve (461) 139
Retained (losses)/earnings (144) 2,772
==================================================== ====================================================
Total equity attributable to the 8,583 11,787
owners of the company
==================================================== ====================================================
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Attributable to the owners of the Company
Share capital Share premium account Share options reserve Foreign Retained earnings/ (losses) Total equity
currency reserve
£000 £000 £000 £000 £000 £000
----------------------------------------- ------------------------------------------------ ------------------------------------------------ ------------------------------------------------ ----------------------------------------------- ------------------------------------------------
Balance at 1 January 2023 60 5,436 3,380 139 2,772 11,787
----------------------------------------- ------------------------------------------------- ------------------------------------------------- ------------------------------------------------- ----------------------------------------------- ------------------------------------------------
Comprehensive loss for the period
Loss for the period - - - - (2,916) (2,916)
Currency translation differences - - - (600) - (600)
----------------------------------------- ------------------------------------------------- ------------------------------------------------- ------------------------------------------------- ----------------------------------------------- ------------------------------------------------
Total comprehensive loss for the period - (600) (2,916) (3,516)
- -
----------------------------------------- ----------------------------------------------- ----------------------------------------------- ----------------------------------------------- ----------------------------------------------- ------------------------------------------------
Transactions with owners of the Company
Share-based payment credit - - 312 - - 312
----------------------------------------- ----------------------------------------------- ----------------------------------------------- ----------------------------------------------- ------------------------------------------------- ------------------------------------------------
Total transactions with owners of the Company - 312 - - 312
-
----------------------------------------- ----------------------------------------------- ----------------------------------------------- ----------------------------------------------- ------------------------------------------------- ------------------------------------------------
Balance at 31 December 2023 60 5,436 3,692 (461) (144) 8,583
----------------------------------------- --------------------------------------------------- --------------------------------------------------- --------------------------------------------------- ------------------------------------------------ ----------------------------------------------
Attributable to the owners of the Company
Share capital Share premium account Share options reserve Foreign Retained earnings Total equity
currency reserve
£000 £000 £000 £000 £000 £000
----------------------------------------- ------------------------------------------------ ------------------------------------------------ ------------------------------------------------ ----------------------------------------------- ------------------------------------------------
Balance at 1 January 2022 60 5,436 2,854 (512) 2,287 10,125
----------------------------------------- ------------------------------------------------- ------------------------------------------------- ------------------------------------------------- ----------------------------------------------- ------------------------------------------------
Comprehensive income for the period
Profit for the period - - - - 485 485
Currency translation differences - - - 651 - 651
----------------------------------------- ------------------------------------------------- ------------------------------------------------- ------------------------------------------------- ----------------------------------------------- ------------------------------------------------
Total comprehensive income for the period - 485 1,136
- - 651
----------------------------------------- ----------------------------------------------- ----------------------------------------------- ----------------------------------------------- ----------------------------------------------- ------------------------------------------------
Transactions with owners of the Company
Share-based payment credit - - 526 - - 526
----------------------------------------- ----------------------------------------------- ----------------------------------------------- ----------------------------------------------- ------------------------------------------------- ------------------------------------------------
Total transactions with owners of the Company - - 526
- 526 -
----------------------------------------- ----------------------------------------------- ----------------------------------------------- ----------------------------------------------- ------------------------------------------------- ------------------------------------------------
Balance at 31 December 2022 60 5,436 3,380 139 2,772 11,787
----------------------------------------- --------------------------------------------------- --------------------------------------------------- --------------------------------------------------- ------------------------------------------------ ----------------------------------------------
CONSOLIDATED STATEMENT OF CASH FLOWS
Year
ended Year
31 Dec 2023 ended
31 Dec 2022
£000 £000
Cash flows from operating activities
(Loss)/profit on ordinary activities before taxation (1,819) 1,147
Adjustments for:
Depreciation - leased assets 213 107
Interest 3 4
payable
Interest (115) (41)
receivable
Increase in trade and other receivables (465) (478)
(Decrease)/increase in trade and other payables (407) 185
Other cost/(income) 33 (167)
Share-based payment charge 312 526
------------------------------------------------------ ------------------------------------------------------
Cash (used in)/generated from operating activities (2,245) 1,283
====================================================== ======================================================
Taxation paid (907) (269)
------------------------------------------------------ ------------------------------------------------------
Net cash (used in)/generated from operating activities (3,152) 1,014
====================================================== ======================================================
Cash flows from investing activity
Interest received 115 41
------------------------------------------------------ ------------------------------------------------------
Net cash generated from investing activity 115 41
====================================================== ======================================================
Cash flows from financing activities
Interest paid in respect of leases (3) (4)
Capital payments in respect of leases (219) (106)
------------------------------------------------------ ------------------------------------------------------
Net cash used in financing activities (222) (110)
====================================================== ======================================================
Net (decrease)/increase in cash and cash equivalents (3,259) 945
Cash and cash equivalents at beginning of period 11,663 10,278
Exchange movement on cash (664) 440
------------------------------------------------------ ------------------------------------------------------
Cash and cash equivalents at end of period 7,740 11,663
====================================================== ======================================================
NOTES TO THE FINANCIAL STATEMENTS
1. General information
Dianomi plc (the "Company") and its subsidiaries' (together the "Group")
principal activity is the delivery of premium native advertising for the
financial services, technology, corporate and lifestyle sectors. The Company
was incorporated on 16 August 2002 in England and Wales as a private company
limited by shares under the name Data-ID Limited. On 17 December 2002, the
Company changed its name to Dianomi Limited. On 17 May 2021, the Company
re-registered as a public limited company and changed its name to Dianomi plc.
The address of the registered office is 6(th) Floor, 60 Gracechurch Street,
London, EC3V 0HR and the limited company number is 04513809.
2. Basis of preparation and material accounting policies
2.1. Basis of preparation
The financial statements for the year ended 31 December 2023 have been
prepared in accordance with the historical cost convention and with
international accounting standards in conformity with the requirements of the
Companies Act 2006 and with UK adopted International Financial Reporting
International Financial Reporting Standards (IFRSs).
The profit before charging interest, tax, depreciation, amortisation,
share-based payment charges, other, non-recurring income and exceptional costs
(adjusted EBITDA) is presented in the income statement as the Directors
consider this performance measure provides a more accurate indication of the
underlying performance of the Company and is commonly used by City analysts
and investors.
The preparation of financial statements requires management to exercise its
judgement in the process of applying accounting policies. The areas involving
a higher degree of judgement, or areas where assumptions and estimates are
significant to the financial information, are disclosed in note 3.
The presentational and functional currency of the Company is sterling. Results
in these financial statements have been prepared to the nearest £1,000.
2.2. Basis of consolidation
The consolidated financial information incorporates the financial information
of Dianomi Plc and all of its subsidiary undertakings. Subsidiary undertakings
include entities over which the Group has effective control, being Dianomi
Inc. and Dianomi Pty Ltd. The Group controls a group when it is exposed to, or
has right to, variable returns from its involvement with the Group and has the
ability to affect those returns through its power over the Group. In assessing
control, the Group takes into consideration potential voting rights.
2.3. Going concern
At the time of approving the financial statements, the Directors have a
reasonable expectation that the Company has adequate resources to continue in
operational existence for the foreseeable future. At 31 December 2023 the
Company had cash and cash equivalents of £7.7 million (2022: £11.7 million)
and net current assets of £8.6 million (2022: £11.8 million). The Group has
no debt outstanding or facilities in place (2022: £nil).
The Directors have prepared detailed cash flow forecasts for the next 18
months that indicate the existing activities of the Group do not require
additional funding during that period. The forecasts are challenged by various
downside scenarios such as the loss of a major publisher, margin erosion or no
new business to stress test the estimated future cash position. The Directors
are pleased to note that the stress tests did not have a significant impact on
the cash flow or cash position of the Group. In addition, current trading is
in line with the forecast.
2.4. Material accounting policies
2.4.1. Revenue
The Group's customers are direct advertisers, affiliate advertisers and
advertising agencies with whom the Group will enter into a contract or
insertion order.
The Group generates revenue by charging advertisers for advertising campaigns
delivered through its platform. The customer's total spend on advertising is
determined by multiplying an agreed performance metric option, such as cost
per mil (CPM), cost per impression (CPI), cost per click (CPC) or cost per
action (CPA) with the volumes of units delivered. Revenue is recognised on
completion of the performance criteria which, in most cases, is when an
internet user clicks through to an advertisement that has been displayed on a
web page.
Where advanced payments are made in advance of satisfying the performance
obligation, these amounts are transferred to deferred revenue (contract
liabilities) and recognised when the performance obligation has been met.
The Group's payment terms vary between 30 to 120 days of receipt of invoice
dependent on advertiser.
The Group does not adjust the transaction price for the time value of money as
it does not expect to have any contracts where the period between the transfer
of the promised services to the client and the payment by the client exceeds
one year.
2.4.2. Cost of sales
Cost of sales represents the direct expenses that are attributable to the
services sold. They consist primarily of payments to publishers under the
terms of the revenue share agreements that the Group has with them. Depending
on the terms of the revenue share agreements, cost of sales can include
commissions where applicable.
In limited instances, the Company incurs costs with publishers based on a
guaranteed minimum rate of payment from the Company in exchange for guaranteed
placement of the Company's promoted recommendations on specified portions of
the publisher's online properties. These guaranteed rates are typically either
a minimum monthly payment or a minimum CPM and are recognised as an expense as
incurred.
2.4.3. Taxation
Current tax is the tax currently payable based on the taxable profit for the
year.
The Group recognises current tax assets and liabilities of entities in
different jurisdictions separately as there is no legal right of offset.
The Group's US subsidiary does not charge US sales tax on its services as it
provides non-taxable services.
Deferred tax is provided in full on temporary differences between the carrying
amounts of assets and liabilities and their tax bases, except when, at the
initial recognition of the asset or liability, there is no effect on
accounting or taxable profit or loss under a business combination. Deferred
tax is determined using tax rates and laws that have been substantially
enacted by the statement of financial position date, and that are expected to
apply when the temporary difference reverses.
Tax losses available to be carried forward, and other tax credits to the
Group, are recognised as deferred tax assets, to the extent that it is
probable that there will be future taxable profits against which the temporary
differences can be utilised.
Changes in deferred tax assets or liabilities are recognised as a component of
the tax expense in the statement of comprehensive income, except where they
relate to items that are charged or credited directly to equity, in which case
the related deferred tax is also charged or credited directly to equity.
2.4.4. Development costs
Costs relating to the ongoing support and development of the Group's platform
are recognised as an expense in profit and loss as incurred.
2.4.5. Foreign currency translation
a) Function and presentational currency
Items included in the financial information of each of the Group's entities
are measured using the currency of the primary economic environment in which
the entity operates ('the functional currency'). The consolidated financial
information is presented in 'sterling', which is the Company's functional
currency and the Group's presentation currency.
On consolidation, the results of overseas operations are translated into
sterling at rates approximating to those ruling when the transactions took
place. All assets and liabilities of overseas operations are translated at the
rate ruling at the reporting date. Exchange differences arising on translating
the opening net assets at opening rate and the results of overseas operations
at actual rate are recognised in other comprehensive income.
b) Transactions and balances
Foreign currency transactions are translated into the functional currency
using the exchange rates prevailing at the dates of the transactions. Foreign
exchange gains and losses resulting from the settlement of such transactions
and from the translation at year-end exchange rates of monetary assets and
liabilities denominated in foreign currencies are recognised in the income
statement.
2.4.6. Cash and cash equivalents
Cash is represented by cash in hand and deposits with financial institutions.
2.4.7. Financial instruments
The Group classifies financial instruments, or their component parts, on
initial recognition as a financial asset, a financial liability or an equity
instrument in accordance with the substance of the contractual arrangement.
Financial instruments are recognised on trade date when the Group becomes a
party to the contractual provisions of the instrument. Financial instruments
are recognised initially at fair value plus, in the case of a financial
instrument not a fair value through profit and loss, transaction costs that
are directly attributable to the acquisition or issue of the financial
instrument. Financial instruments are derecognised on the trade date when the
Group is no longer a party to the contractual provisions of the instrument.
Non-derivative financial instruments comprise trade and other receivables,
cash and cash equivalents, loans and borrowings and trade and other payables.
All financial instruments held are classified as loans and receivables.
a) Trade and other receivables and trade and other payables
Trade and other receivables are recognised initially at transaction price less
attributable transaction costs. Trade and other payables are recognised
initially at transaction price plus attributable transaction costs. Subsequent
to initial recognition they are measured at amortised cost using the effective
interest method, less any expected credit losses in the case of trade
receivables. If the arrangement constitutes a financing transaction, for
example if payment is deferred beyond normal business terms, then it is
measured at the present value of future payments discounted at a market rate
of interest for a similar debt instrument.
b) Contract liabilities
A contract liability is recognised if a payment is received or a payment is
due (whichever is earlier) from a customer before the Group transfers the
related services. Contract liabilities are recognised as revenue when the
performance obligation has been met.
c) Interest-bearing borrowings
Interest-bearing borrowings are recognised initially at the present value of
future payments discounted at a market rate of interest. Subsequent to initial
recognition, interest-bearing borrowings are stated at amortised costs using
the effective interest method, less any impairment losses.
d) Cash and cash equivalents
Cash and cash equivalents comprise cash balances and call deposits.
e) Derivative financial instruments
Derivative financial instruments comprise economic hedges. Hedge accounting is
not applied to derivative instruments that economically hedge financial assets
and liabilities denominated in foreign currencies. Changes in the fair value
of such derivatives are recognized in profit or loss under financing income or
expenses.
2.4.8. Leases
The Group leases property in the UK, US and Australia.
All leases are accounted for by recognising a right-of-use asset and a lease
liability except for:
- Leases of low value assets; and
- Leases with a duration of twelve months or less.
These leases are recognised as an expense on a straight-line basis over the
term of the lease.
Lease liabilities are measured at the present value of contractual payments
due to the lessor over the lease term, with the discount rate determined by
reference to the rate inherent in the lease unless (as is typically the case)
this is not readily determinable, in which case the Group's incremental
borrowing rate on commencement of the lease is used. This was 3.0 per cent. in
the periods under review. Variable lease payments are only included in the
measurement of the lease liability if they depend on an index or rate. In such
cases, the initial measurement of the lease liability assumes the variable
element will remain unchanged throughout the lease term. Other variable lease
payments are expensed in the period to which they relate.
Right-of-use assets are initially measured at the amount of the lease
liability, reduced for any lease incentives received, and increased for:
- Lease payments made at or before commencement of the lease;
- Initial direct costs incurred; and
- The amount of any provision recognised where the Group is
contractually required to dismantle, remove or restore the leased asset
(typically leasehold dilapidations).
Subsequent to initial measurement lease liabilities increase as a result of
interest charged at a constant rate on the balance outstanding and are reduced
for lease payments made. Right-of-use assets are amortised on a straight-line
basis over the remaining term of the lease or over the remaining economic life
of the asset if, rarely, this is judged to be shorter than the lease term.
No lease modification or reassessment changes have been made during the
reporting period from changes in any lease terms or rent charges.
2.4.9. Earnings per share
The Group presents basic and diluted earnings per share on an IFRS basis. In
calculating the weighted average number of shares outstanding during the
period, any share restructuring is adjusted to allow comparability with other
periods. The calculation of diluted earnings per share assumes conversion of
all potentially dilutive ordinary shares, which arise from share options
outstanding.
2.4.10. Financing income and expenses
Financing expenses comprise interest payable, finance charges on shares
classified as liabilities and leases recognised in the income statement using
the effective interest method, unwinding of the discount on provisions, and
not foreign exchange losses that are recognised in the statement of
comprehensive income.
Financing income includes interest receivable on funds invested. Interest
income and interest payable are recognised in the statement of comprehensive
income as they accrue, using the effective interest method.
2.4.11. Reorganisation costs
Items which are material because of their size or nature and which are
non-recurring are highlighted separately on the face of the consolidated
statement of comprehensive income. The separate reporting of exceptional
items helps provide a better picture of the Group's underlying performance.
Items which have been included within this category are the costs relating the
reorganisation which took place in 2023.
Reorganisation costs are excluded from the headline profit measures used by
the Group and are highlighted separately in the consolidated statement of
comprehensive income as management believe that they need to be considered
separately to gain an understanding the underlying profitability of the
trading businesses.
2.4.12. Employee benefits
Post-retirement benefits
The Group operates a defined contribution plan for its employees. A defined
contribution plan is a pension plan under which the Group pays fixed
contributions into a separate entity. Once the contributions have been paid
the Group has no further payment obligations.
The contributions are recognised as an expense in administrative expenses in
the Consolidated Statement of Comprehensive Income when they fall due. Amounts
not paid are shown in accruals as a liability in the Statement of Financial
Position. The assets of the plan are held separately from the Group in
independently administered funds.
Share-based payments
Where share options are awarded to employees, the fair value of the options at
the date of grant is charged to profit or loss over the vesting period.
Non-market vesting conditions are taken into account by adjusting the number
of equity instruments expected to vest at each Statement of Financial Position
date so that, ultimately, the cumulative amount recognised over the vesting
period is based on the number of options that eventually vest. Market vesting
conditions are factored into the fair value of the options granted. The
cumulative expense is not adjusted for failure to achieve a market vesting
condition.
The fair value of the award also takes into account non-vesting conditions.
These are either factors beyond the control of either party (such as a target
based on an index) or factors which are within the control of one or other of
the parties (such as the group keeping the scheme open or the employee
maintaining any contributions required by the scheme).
Where the terms and conditions of options are modified before they vest, the
increase in the fair value of the options, measured immediately before and
after the modification, is also charged to profit or loss over the remaining
vesting period. If a modification results in a reduction in the number of
options granted, then this results in an acceleration of the vesting period
and therefore any amount unrecognised that would otherwise have been charged
is charged to profit or loss immediately.
Where equity instruments are granted to persons other than employees, profit
or loss is charged with the fair value of goods and services received.
2.5. Standards issued but not yet effective
The IASB and IFRIC have issued the following relevant standards and
interpretations with effective dates as noted below:
Standard Key Requirements Effective date (for annual periods beginning on or after)
Amendments to IAS 1 Presentation of Liabilities as Current or Non-current The amendments clarify how conditions with which an entity must comply within 1 January 2024
twelve months after the reporting period affect the classification of a
liability.
Amendments to IFRS 16 Lease Liability in a Sale and Leaseback The amendments clarify how a seller-lessee subsequently measures sale and 1 January 2024
leaseback transactions that satisfy the requirements in IFRS 15 to be
accounted for as a sale.
Amendments to IAS 1 Non-Current Liabilities with Covenants The amendment clarifies how conditions with which an entity must comply within 1 January 2024
twelve months after the reporting period affect the classification of a
liability.
Amendments to IAS 21 The Effects of Changes in Foreign Exchange Rates The amendments clarify when a currency is exchangeable into another currency 1 January 2025
and how a company estimates a spot rate when a currency lacks exchangeability.
The new standards, listed above, are not expected to have a material impact on
the Group in the current or future reporting periods and on foreseeable future
transactions.
2.6. Alternative performance measures
In order to provide better clarity to the underlying performance of the Group,
adjusted EBITDA and adjusted earnings per share are used as alternative
performance measures. These measures are not defined under IFRS. These
non-GAAP measures are not intended to be a substitute for, or superior to, any
IFRS measures of performance, but have been included as the Directors consider
adjusted EBITDA and adjusted earnings per share to be key measures used within
the business for assessing the underlying performance of the Group's ongoing
business across periods. Adjusted EBITDA excludes from operating profit
non-cash depreciation, share-based payment charges, other, non-recurring
income and non-recurring exceptional costs. Adjusted EPS excludes from profit
after tax share-based payment charges, other, non-recurring income and
non-recurring exceptional items and their related tax impacts. Please refer to
note 8 for reconciliations to Alternative Performance Measures ("APMs").
3. Judgements and key sources of estimation uncertainty
The preparation of the consolidated financial information requires the
Directors to make estimates and judgements that affect the reported amounts of
assets, liabilities, costs and revenue in the consolidated financial
information. Actual results could differ from these estimates. The judgements,
estimates and associated assumptions are based on historical experience and
other factors that are considered to be relevant. The judgements and key
sources of estimation uncertainty that have a significant effect on the
amounts recognised in the consolidated financial information are:
Estimations:
- Share-based payments: the Group measures the cost of
equity-settled transactions with employees by reference to the fair value of
equity instruments at the date at which they are granted. The fair value is
determined by using the Black-Scholes model taking into account the terms and
conditions upon which the instruments were granted and requires assumptions to
be made in particular the value of the shares at the date of options granted.
Management have had to apply judgement when selecting assumptions.
- Receivables provision: the Group reviews the amount of credit loss
associated with its trade receivables, intercompany receivables and other
receivables based on historical default rates as well as forward looking
estimates that consider current and forecast credit conditions.
Judgements:
- Deferred tax: the extent to which deferred tax assets can be
recognised is based on an assessment of the probability that future taxable
income will be available against which the deductible temporary differences
and tax loss carry-forwards can be utilised. In addition, significant
judgement is required in assessing the impact of any legal or economic limits
or uncertainties.
- Going concern: The financial statements have been prepared on the
going concern basis based on a judgement by the Directors that the Group will
continue to be able to meet its liabilities as they fall due for the
foreseeable future, being a period of at least 18 months from the date of
signing these financial statements. In this context, the Directors have
prepared detailed cash flow forecasts for the next 18 months that indicate the
existing activities of the Group do not require additional funding during that
period. The forecasts were challenged by various downside scenarios to stress
test the estimated future cash position. The Directors note that the stress
tests did not have a significant impact on the cash flow or cash position of
the Group. In addition, current trading is in line with the forecast.
- Treatment of costs incurred in relation to the reorganisation: The
Group has recorded significant one-off costs in respect of the reorganisation
undertaken in the year ended 31 December 2023 including consultancy, legal and
employee settlement costs. The Directors reviewed the reasonableness and
inclusion of these items in operating adjusted items and the disclosures in
the Annual Report.
3. Revenue
Revenue arises from:
Year to Year to
31 Dec 2023 31 Dec 2022
£000 £000
EMEA 4,811 6,591
United States of America 24,428 28,317
APAC 915 1,007
====================================================== ======================================================
30,154 35,915
====================================================== ======================================================
4. Operating segments
The Group is operated as one global business by its executive team, with key
decisions being taken by the same leaders irrespective of the geography where
work for clients is carried out. The Directors consider that the geographies
where the Group operates have similar economic and operating characteristics
and the products and services provided in each region are all related to
premium native advertising. Management therefore consider that the Group has
one operating segment. The Group report is presented and measured to the
Board as a single segment and is consistent with the financial statements.
As such, no additional disclosure has been recorded under IFRS 8.
6. Other income
Year to Year to
31 Dec 2023 31 Dec 2022
£000 £000
Other income - 167
====================================================== ======================================================
Other income in the year ended 31 December 2022 related to a tax refund as a
result of an R&D tax credit.
7. Administrative expenses
Year to Year to
31 Dec 2023 31 Dec 2022
£000 £000
Direct staff costs 4,476 5,167
IT and software costs 1,511 1,273
Legal and professional 734 754
Rent 146 239
Insurance 268 186
Depreciation - leased assets 213 107
Foreign exchange (gains)/losses (39) 33
Share-based payments 312 526
Other administrative expenses 708 696
====================================================== ======================================================
8,329 8,981
====================================================== ======================================================
During the year the Group obtained the following services from the Company's
auditors as detailed below:
Year to Year to
31 Dec 2023 31 Dec 2022
£000 £000
Audit fees 128 118
Other services:
Tax compliance 10 19
Agreed upon procedures on interim results 17 15
====================================================== ======================================================
155 152
====================================================== ======================================================
8. Reconciliations to alternative profit measures
In order to provide better clarity to the underlying performance of the Group,
Dianomi uses adjusted EBITDA and adjusted earnings per share as alternative
performance measures. These measures are not defined under IFRS. These
non-GAAP measures are not intended to be a substitute for, or superior to, any
IFRS measures of performance, but have been included as the Directors consider
adjusted EBITDA and adjusted earnings per share to be key measures used within
the business for assessing the underlying performance of the Group's ongoing
business across periods. Adjusted EBITDA excludes non-cash depreciation
charges, share-based payment charges, other, non-recurring income and
non-recurring exceptional costs from operating (loss)/profit. Adjusted EPS
excludes share-based payment charges, other, non-recurring income and
non-recurring exceptional items and their related tax impacts from profit
after tax.
The table below sets out the reconciliation of the Group's adjusted EBITDA and
adjusted (loss)/profit before tax from (loss)/profit before tax.
Year to Year to
31 Dec 2023 31 Dec 2022
£000 £000
====================================================== ======================================================
(Loss)/profit before tax (1,819) 1,147
====================================================== ======================================================
Adjusting items:
Reorganisation costs 1,054 -
Share-based payments 312 526
Other income - (167)
====================================================== ======================================================
Adjusted (loss)/profit before tax (453) 1,506
====================================================== ======================================================
Depreciation 213 107
Net finance income (112) (37)
====================================================== ======================================================
Adjusted EBITDA (352) 1,576
====================================================== ======================================================
The table below sets out the reconciliation of the Group's adjusted
(loss)/profit after tax to adjusted (loss)/profit before tax.
====================================================== ======================================================
Adjusted (loss)/profit before tax (453) 1,506
====================================================== ======================================================
Tax expense (1,097) (662)
Derecognition of deferred tax asset 675
Tax impact of adjusting items (55) (68)
====================================================== ======================================================
Adjusted (loss)/profit after tax (930) 776
====================================================== ======================================================
Adjusted (loss)/profit after tax is used in calculating adjusted basic and
adjusted diluted EPS. Adjusted (loss)/profit after tax is stated before
adjusting items and their associated tax effects. Adjusted EPS is calculated
by dividing the adjusted (loss)/profit after tax for the period attributable
to Ordinary shareholders by the weighted average number of ordinary shares
outstanding during the period. Adjusted diluted EPS is calculated by dividing
adjusted (loss)/profit after tax by the weighted average number of shares
adjusted for the impact of potential ordinary shares. Potential Ordinary
shares are treated as dilutive when their conversion to Ordinary shares would
decrease EPS. Please refer to note 13 for further detail.
9. Employee information
The average number of persons employed by the Group (including directors)
during the year, analysed by category, was as follows:
Year to Year to
31 Dec 2023 31 Dec 2022
Number Number
Directors 6 7
Employees 36 39
---------------------------------------------------- ----------------------------------------------------
42 46
====================================================== ======================================================
The aggregate payroll costs of these persons (including directors) were as
follows:
Year to Year to
31 Dec 2023 31 Dec 2022
£000 £000
Wages and salaries 3,965 4,537
Social security costs 464 569
Pension costs 47 61
Share-based payment expense 312 526
---------------------------------------------------- ----------------------------------------------------
4,788 5,693
===================================================== =====================================================
A defined contribution pension scheme is operated by a third party and the
Group pays contributions on behalf of the employees. The assets of the scheme
are held separately from those of the Group in an independently administered
fund. The pension charge represents contributions payable by the Group to the
fund. Contributions amounting to £nil were payable to the fund at the end of
2023 (2022: £nil).
Key management personnel include employees across the Group who together have
authority and responsibility for planning, directing and controlling the
activities of the Group. Key management personnel are considered to be the
executive directors of the Group and details regarding their remuneration are
set out below:
FY23
Salary Notice and Termination Payment Benefits Pension Total
Name £'000s £'000s £'000s £'000s £'000s
Rupert Hodson 190 - 11 2 203
Charlotte Stranner 180 - - 1 181
Raphael Queisser( 1 ) 37 221 2 1 261
Robert Cabell de Marcellus( 1 ) 37 225 - 1 263
Total 444 446 13 5 908
FY22
Salary Bonus/ Commission Benefits Pension Total
Name £'000s £'000s £'000s £'000s £'000s
Rupert Hodson 220 - 11 2 233
Charlotte Stranner 180 - - 1 181
Raphael Queisser( 1 ) 220 - 7 3 230
Robert Cabell de Marcellus( 1 ) 220 - 2 4 226
Total 840 - 20 10 870
( 1 ) Raphael Queisser and Robert Cabell de Marcellus stepped down
from the board and from their positions as COO and CTO respectively on 15
March 2023.
The highest paid director received remuneration of £203k (2022: £233k). No
share options were exercised by the directors in the year (2022: nil).
10. Finance income and expense
Year to Year to
31 Dec 2023 31 Dec 2022
£000 £000
Interest received 115 41
---------------------------------------------- ----------------------------------------------
Total finance income 115 41
============================================ ============================================
On lease liability 3 4
---------------------------------------------- ----------------------------------------------
Total finance expense 3 4
============================================ ==============================================
11. Taxation
Year to Year to
31 Dec 2023 31 Dec 2022
£000 £000
UK corporation tax
Current tax on (loss)/profit for the year - -
Adjustments in respect of prior periods - -
----------------------------------------------- -----------------------------------------------
- -
================================================= =================================================
Foreign tax
Foreign tax on (loss)/profit for the year 422 662
----------------------------------------------- -----------------------------------------------
Total current tax 422 662
================================================= =================================================
Deferred tax
Origination and reversal of timing differences 675 -
----------------------------------------------- -----------------------------------------------
Total deferred tax 675- --
================================================= =================================================
----------------------------------------------- -----------------------------------------------
Taxation on (loss)/profit on ordinary activities 1,097 662
================================================= =================================================
Reconciliation of tax expense
The tax assessed on the (loss)/profit on ordinary activities for the year is
higher than (2022: higher than) the standard rate of corporation tax in the UK
of 23.52%( 1 ) (2022: 19%).
Year to Year to
31 Dec 2023 31 Dec 2022
£000 £000
(Loss)/profit on ordinary activities before taxation (1,819) 1,147
======================================================= =======================================================
(Loss)/profit on ordinary activities multiplied by standard rate of (428) 218
corporation tax in the UK of 23.52%( 1 ) (2022: 19%)
Effects of:
Expenses not deductible for tax purposes 127 16
Foreign tax - 321
Difference in tax rates (38) -
Deferred tax not recognised 1,436 107
======================================================= =======================================================
Tax on (loss)/profit 1,097 662
======================================================= ======================================================
( 1 ) the standard rate of corporation tax in the UK increased from 19% to
25% in April 2023 hence a blended rate of 23.52% has been used for 2023.
A total of £946k was paid during the year with respect to US tax relating to
both 2022 and 2023 (2022: £436k), offset by a net credit received in relation
to Australian tax of £35k (2022: £nil) and a UK corporation tax credit of
£4k respectively (2022: credit of £167k).
12. Deferred tax
Deferred tax asset
As at As at
31 Dec 2023 31 Dec 2022
£000 £000
Tax losses - 675
============= =========================== ========================================
The Company has an unrecognised deferred tax asset of £2,763k calculated at
25% (gross £11,055k) (FY22: 25%, gross amount £5,748k) in respect of losses
carried forward to future years. Given the uncertainty of the timing as to
when the losses will be utilised the Directors have decided to take a cautious
approach and derecognise the deferred tax asset brought forward.
13. Earnings per share
The Group presents non-adjusted and adjusted basic and diluted (loss)/earnings
per share (EPS) for its ordinary shares. Basic EPS is calculated by dividing
the (loss)/profit for the period attributable to ordinary shareholders by the
weighted average number of ordinary shares outstanding during the period.
Diluted EPS takes into consideration the Company's dilutive contingently
issuable shares. The weighted average number of ordinary shares used in the
diluted EPS calculation is inclusive of the number of share options that are
expected to vest subject to performance criteria as appropriate, being met.
The (loss)/profit and weighted average number of shares used in the
calculations are set out below:
Year to Year to
31 Dec 2023 31 Dec 2022
£000 £000
(Loss)/profit attributable to the ordinary equity holders of the Group used in (2,916) 485
calculating basic and diluted EPS
Basic (loss)/earnings per ordinary share (p) (9.71) 1.62
Diluted (loss)/earnings per ordinary share (p) (9.71) 1.46
Year to Year to
31 Dec 2023 31 Dec 2022
Adjusted basic and diluted EPS £000 £000
Reconciliation of earnings used in calculating adjusted EPS:
(Loss)/profit attributable to the ordinary equity holders of the Group used in
calculating basic and diluted EPS
(2,916)
485
Adjusting items:
Share-based payments 312 526
Reorganisation costs 1,054 -
Other income - (167)
Derecognition of deferred tax asset 675 -
Tax impact of adjusting items (55) (68)
====================================================== ======================================================
(Loss)/profit attributable to the ordinary equity holders of the Group used in (930) 776
calculating adjusted basic and diluted EPS
Adjusted basic (loss)/earnings per ordinary share (p) (3.10) 2.58
Adjusted diluted (loss)/earnings per ordinary share (p) (3.10) 2.34
Year to Year to
31 Dec 2023 31 Dec 2022
Weighted average number of ordinary shares used as the denominator in 30,027,971 30,027,971
calculating non-adjusted and adjusted basic EPS
Weighted average share option dilution impact 1,642,490 3,184,268
============================================================== ===============================================================
Weighted average number of ordinary shares used as the denominator in 31,670,461 33,212,239
calculating non-adjusted and adjusted diluted EPS
14. Right-of-use assets
Leased property
£000
Cost
At 1 January 2022 257
Additions 320
===================================================
At 31 December 2022 577
==================================================
At 1 January 2023 577
Additions -
===================================================
At 31 December 2023 577
==================================================
Depreciation
At 1 January 2022 257
Depreciation charge 107
===================================================
At 31 December 2022 364
==================================================
At 1 January 2023 364
Depreciation charge 213
===================================================
At 31 December 2023 577
===================================================
Net book value
At 31 December 2022 213
At 31 December 2023 -
In 2022 the Company entered into an 18-month lease for its serviced office
premises in London. The total payments due under the term of the lease
amounted to £0.3 million. Lease liabilities in respect of right-of-use assets
were nil as at 31 December 2023 (2022: £0.2 million). The discount rate used
in determining the present value of the lease liability was 3%. The interest
expense recognised in the statement of comprehensive income for the year ended
31 December 2023 was £3k (2022: £4k). In December 2023 the Company entered
into a new 12-month lease agreement for its serviced office premises in London
which commenced 1 January 2024.
15. Subsidiaries
The undertakings in which the Group's interest at the year-end is 20 per cent.
or more are as follows:
Subsidiary undertakings Country of incorporation Principal activity At 31 Dec At 31 Dec 2022
2023
Dianomi Inc United States Business support services 100% 100%
Dianomi PTY Australia Business support services 100% 100%
The registered office of Dianomi Inc is Corporate Service Bureau Inc., 28 Old
Rudnick Lane, Dover, Delaware,19901. The registered office of Dianomi PTY is
ALM Williams Partners, Level 2, 570 St Kilda Road, Melbourne, VIC 3004.
16. Trade and other receivables
As at As at
31 Dec 2023 31 Dec 2022
£000 £000
Current
Trade receivables 8,081 7,488
Prepayments 145 116
Loan receivable 5 52
Other receivables 108 218
---------------------------------------------- ----------------------------------------------
8,339 7,874
============================================== ==============================================
All of the trade receivables were non-interest bearing and receivable under
normal commercial terms. The directors consider that the carrying value of
trade and other receivables approximates to their fair value.
The loan receivable balances relate to a loan owed from Buckingham Gate
Financial Services Limited, a shareholder and related party. The loan accrues
annual interest at 4%.
The expected credit loss on trade and other receivables was not material at
the current or prior year end. For analysis of the maximum exposure to credit
risk, please refer to note 21.
The impairment loss recognised in the income statement for the period in
respect of bad and doubtful trade receivables was £35k (2022: £52k).
The ageing of trade receivables is detailed below:
As at 31 December 2023
< 30 days < 60 days < 90 days < 180 days > 180 days Total
£000 £000 £000 £000 £000 £000
Gross carrying amount 3,316 2,312 1,047 797 609 8,081
=============================================== ============================================== ============================================ ============================================ ============================================== =================================================
As at 31 December 2022
< 30 days < 60 days < 90 days < 180 days > 180 days Total
£000 £000 £000 £000 £000 £000
Gross carrying amount 3,626 1,743 814 456 849 7,488
=============================================== ============================================== ============================================ ============================================ ============================================== =================================================
17. Cash and cash equivalents
As at 31 Dec As at 31 Dec 2022
2023
£000 £000
Cash at bank and in hand 7,740 11,663
============================================ ==============================================
Cash at bank earns interest at floating rates based on bank deposit
rates.
18. Trade and other payables
As at 31 Dec As at 31 Dec 2022
2023
£000 £000
Current liabilities
Trade payables 4,221 3,035
Other taxes and social security costs 37 116
Contract liabilities - 104
Other payables and accruals 3,383 4,793
---------------------------------------------- ----------------------------------------------
7,641 8,048
============================================ =============================================
The fair value of trade and other payables approximates to book value at each
year end. Trade payables are non-interest bearing and are normally settled
monthly.
19. Lease liabilities
As at 31 Dec As at 31 Dec
2023 2022
£000 £000
Current liabilities
Lease liabilities
- 219
-------------------------------------------- --------------------------------------------
- 219
========================================== ==========================================
The Group leases an office building in London for use by its staff. The
discount rate used in determining the present value of lease liabilities was
the Group's incremental borrowing rate of 3%. The interest expense recognised
in the consolidated statement of comprehensive income for the year ended 31
December 2023 was £3k (2022: £4k). Payments of £222k (2022: £106k) in
respect of rental payments paying down lease liabilities have been recognised
in the consolidated statement of cash flows. In December 2023 the Company
entered into a new 12-month lease agreement for its serviced office premises
in London which commenced 1 January 2024.
The office leases in the US and Australia are considered short term as the
lease terms are 12 months or less. The total amount recorded in the
consolidated statement of comprehensive income in respect of short-term leases
is £145k (2022: £239k). Remaining commitments on short term leases are
recorded below.
As at 31 Dec As at 31 Dec 2022
2023
£000 £000
Within one year 29 27
-------------------------------------------- --------------------------------------------
29 27
========================================== ==============================================
19. Financial instruments
The Group's and Company's financial instruments may be analysed as follows:
As at 31 Dec As at 31 Dec 2022
2023
£000 £000
Financial assets
Financial assets measured at amortised cost:
Cash at bank and in hand 7,740 11,663
Trade receivables 8,081 7,488
Loan receivable 5 52
Other receivables 108 218
=============================================== ===============================================
15,934 19,421
=============================================== ===============================================
Financial liabilities
Financial liabilities measured at amortised cost:
Trade payables 4,221 3,035
Other payables and accruals 3,383 4,793
=============================================== ===============================================
7,604 7,828
=============================================== ==============================================
The Group's income, expense, gains and losses in respect of financial assets
measured at fair value through profit or loss realised a fair value loss of
£nil (2022: gain of £nil).
21. Financial risk management
The Group and Company is exposed to a variety of financial risks through its
use of financial instruments which result from its operating activities. All
of the Group's financial instruments are classified as loans and receivables.
The Group does not actively engage in the trading of financial assets for
speculative purposes. The most significant financial risks to which the Group
is exposed are described below:
Credit risk
Generally, the Group's and Company's maximum exposure to credit risk is
limited to the carrying amount of the financial assets recognised at the
reporting date, as summarised below:
As at 31 Dec As at 31 Dec
2023 2022
£000 £000
Trade receivables 8,081 7,488
Other receivables 258 386
-------------------------------------------------- --------------------------------------------------
8,339 7,874
================================================ ================================================
Credit risk is the risk of financial risk to the Group and Company if a
counter party to a financial instrument fails to meet its contractual
obligation. The nature of the Group's and Company's debtor balances, the time
taken for payment by clients and the associated credit risk are dependent on
the type of engagement.
The Group's and Company's trade and other receivables are actively monitored.
The ageing profile of trade receivables is monitored regularly by the Chief
Financial Officer. Any debtors over 60 days are individually reviewed by the
Chief Financial Officer every month and explanations sought for any balances
that have not been recovered. A summary of significant trade and other
receivables is provided to the Directors on a monthly basis and any issues are
brought to their attention.
Unbilled revenue is recognised by the Group and Company only when all
conditions for revenue recognition have been met in line with the Group's
accounting policy.
The Directors are of the opinion that there is no material credit risk at
group level.
Liquidity risk
Liquidity risk is the risk that the Group will encounter difficulty in meeting
its obligations associated with its financial liabilities. The Group seeks to
manage financial risks to ensure sufficient liquidity is available to meet
foreseeable needs and to invest cash assets safely and profitably.
The tables below analyse the Group's financial liabilities into relevant
maturity groupings based on their contractual maturities.
The amounts disclosed in the tables are the contractual undiscounted cash
flows. Balances due within 12 months equal their carrying balances, because
the impact of discounting is not significant.
Contractual maturities of financial liabilities:
As at 31 December 2023 As at 31 December 2022
Carrying amount of Carrying amount of
Less than 6 months representing total contractual cashflows liabilities Less than 6 months representing total contractual cashflows Liabilities
£000 £000 £000 £000
Trade and other payables 7,641 7,641 8,048 8,048
============================================ ============================================ ============================================ ============================================
Total 7,641 7,641 8,048 8,048
======================================= ============================================ ========================================= ============================================
Interest rate risk
As at 31 December 2023 and 2022 the Group has no interest rate risk exposure
as the Group had no debt outstanding.
Foreign currency risk
The Group operates internationally and is exposed to foreign exchange risk
arising from various currency exposures, primarily US Dollars and Australian
Dollars. The Group monitors exchange rate movements closely and occasionally
enters into forward contract agreements to hedge against the potential
volatility of unfavourable foreign exchange rates. The Group ensures adequate
funds are maintained in appropriate currencies to meet known liabilities. The
Group also has trade receivable balances in foreign currency and monitors the
potential effect of any exchange rate movements on these balances.
The Group's exposure to foreign currency risk at the end of the respective
reporting period, expressed in Currency Units, was as follows:
As at 31 December 2023
CU000's
USD CAD EUR AUD SGD
Cash & cash equivalents 8,399 355 41 968 364
As at 31 December 2022
CU000s
USD CAD EUR AUD SGD
Cash & cash equivalents 11,017 1,170 249 825 265
The Group is exposed to foreign currency risk on the relationship between the
functional currencies of the Group companies and the other currencies in which
the Group's material assets and liabilities are denominated. The table below
summaries the effect on profit and loss had the functional currency of the
Group weakened or strengthened against these other currencies, with all other
variables held constant.
As at 31 Dec As at 31 Dec 2022
2023
£000 £000
10% weakening of functional currency 100 193
================================================== ==================================================
10% strengthening of functional currency (82) (160)
================================================== ========================================
The impact of a change of 10% has been selected as this has been considered
reasonable given the current level of exchange rates and the volatility
observed both on a historical basis and market expectations for future
movements.
Fair value of financial instruments
The fair values of all financial assets and liabilities approximates their
carrying value.
Capital risk management policy
The Group's capital management objectives are:
· to ensure the Group's ability to continue as a going concern in order
to continue to provide returns for shareholders and benefits for other
stakeholders
· maintain an optimal capital structure to reduce the cost of capital
The Group considers its capital comprises share capital plus all reserves,
which amounted to £8.6 million as at 31 December 2023 (2022: £11.8
million).
The Group has no debt facilities in place as at 31 December 2023 (2022:
£nil). Management assesses the Group's capital requirements in order to
maintain an efficient overall financing structure. The Group manages the
capital structure and makes adjustments to it in the light of changes in
economic conditions and the risk characteristics of the underlying assets.
22. Related party disclosures
Transactions with BGF are disclosed below:
Year ended Year ended
31 Dec 2023 31 Dec 2022
£000 £000
Annual fee 50 50
================================================ ==============================================
The amount due to BGF as at 31 December 2023 is £nil (2022: £77k). The
annual fee relates specifically to Matthew Singh's (a representative of BGF)
services as a Non-Executive Director.
The Group received revenues of £29k (2022: £45k) from Buckingham Gate
Financial Services Limited, a company that is controlled by shareholders of
the Company. As at 31 December 2023 there were trade receivables from
Buckingham Gate Financial Services Limited of £3k (31 December 2022: £4k).
The Group also has a loan receivable from Buckingham Gate Financial Services
Limited of £5k as at 31 December 2023 (31 December 2022: £52k), details of
which are set out in note 16. Interest receivable of £1k accrued in the year
ended 31 December 2023 (2022: £3k).
23. Share capital
Issued Shares Number Nominal Value Issued Amount
£
£
Ordinary Shares
As at 31 December 2022, 1 January 2023 and 31 December 2023 30,027,971 0.002 60,056
24. Share-based payments
At the time of the Company's IPO in May 2021, the Dianomi
introduced share option schemes (the "IPO Option Schemes") in order to retain,
incentivise and align employees with shareholders. Under the IPO Option
Schemes employees were granted share options with an exercise price equal to
the IPO price (or for those granted post IPO equal to the then current share
price), a vesting period of 3 years and a non-market performance condition.
During the current financial year, it became clear that the performance
condition for those options granted at IPO was not going to be met and for
those options granted in 2022 under the same scheme it was unlikely to be met.
Therefore, it was decided that employees who were granted options in 2021 and
2022 would be given the option to have their original options cancelled (the
"Cancellation"), and replacement option schemes (the "Replacement Option
Schemes") would be introduced under which employees would be issued with new
options with a revised performance condition, exercise price and extended
vesting period but at a lower number than those originally issued.
315,950 options lapsed before the Cancellation due to employees leaving the
Group as part of the reorganisation.
242,424 options were granted in April 2023 under the IPO Option Schemes with
an exercise price of 82.5 pence were not cancelled.
1,405,601 options which were granted under the IPO Option Schemes were
cancelled in November 2023. Simultaneously, 1,177,593 new options were issued
under the Replacement Option Schemes.
Weighted average exercise price Number Weighted average exercise price (pence) Number
(pence)
Dec 23 Dec 23 Dec 22 Dec 22
Outstanding at the beginning of the period 278 1,721,551 273 1,594,387
Granted during the period 55 1,420,017 335 134,627
Lapsed/cancelled during the period 278 (1,721,551) 335 (7,463)
-------------------------------------------- ----------------------------------------------------------- ------------------------------------------------------------- --------------------------------------------------------
Outstanding at the end of the period 55 1,420,017 278 1,721,551
============================================ = ====================== ============================================ =======================================================
==================================
Of the total number of options outstanding at the end of the period, nil had
vested and were exercisable at the end of the year (31 Dec 22: Nil).
The Black-Scholes option pricing model was used to value the equity-settled
share-based payment awards as it was considered that this approach would
result in materially accurate estimate of the fair value of the options
granted.
The inputs into the model were as follows:
Options granted under IPO Option Schemes
Weighted average share price at grant date (£) 2.78
Weighted average exercise price (£) 2.78
Volatility (%) 44.00%
Weighted average vesting period (years) 3
Risk free rate (%) 3.482%
Expected dividend yield (%) -
Options granted under Replacement Option Schemes
Weighted average share price at grant date (£) 48
Weighted average exercise price (£) 50
Volatility (%) 52.91%
Weighted average vesting period (years) 3
Risk free rate (%) 3.595%
Expected dividend yield (%) -
The share-based remuneration expense comprises:
As at As at
31 Dec 2023 31 Dec 2022
£000 £000
Equity-settled schemes 312 526
========================================== ==========================================
25. Reserves
Share Capital
Share capital represents the nominal value of share capital subscribed.
Share Premium
Share premium represents the funds received in exchange for shares over and
above the nominal value, offset by costs incurred on the raise of equity.
Capital redemption reserve
The capital redemption reserve is a non-distributable reserve into which
amounts are transferred following the redemption or purchase of the Company's
own shares.
Foreign currency translation reserve The foreign currency translation reserve
represents exchange differences that arise on consolidation from the
translation of the financial statements of foreign subsidiaries.
Retained earnings
The retained earnings reserve represents cumulative net gains and losses
recognised in the statement of comprehensive income.
Share option reserve
The share-based payment reserve represents amounts accruing for equity settled
share options granted plus the fair value of share options exercised upon IPO.
26. Ultimate controlling party
There is no ultimate controlling party as at 31 December 2023 nor was there as
at 31 December 2022.
27. Contingent liabilities and contingent assets
The Group had no contingent liabilities or contingent assets at 31 December
2023 (31 December 2022: £nil).
28. Capital Commitments
The Group's capital commitments at 31 December 2023 are £nil (31 December
2022: £nil).
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