Half-year Report

RNS Number : 4098N

Dukemount Capital PLC

29 January 2021

 

Dukemount Capital PLC

29 January 2021 

  29 January 2021

Dukemount Capital Plc

("Dukemount" or "the Company")

Interim Results

Dukemount Capital Plc (LSE: DKE) is pleased to announce its unaudited interim results for the six months ended 31 October 2020 ("the Interim Report").

Highlights

Operational Developments

· Certificate of Practical Completion for the Wavertree refurbishment project awarded

· Wavertree building handed over to the project funder and Housing Association

Post Period

· Certificate of Practical Completion for the West Derby development project issued.

Geoffrey Dart commented:

"The unprecedented Covid-19 pandemic which has plagued the world for a year, has disrupted our business model's timescales but also given us the opportunity to investigate other sources of long-term income within wider sectors. Whilst 2020 has been challenging we have managed to progress both projects in Liverpool despite the  nationwide lockdown and severe problems with the supply of building materials.

The issuance of the Certificate of Practical Completion and subsequent handover of the Wavertree building to the project funder and  Housing Association during the 6-month period followed by issuance of the Certificate of Practical Completion for the West Derby project in November have now allowed us to investigate further projects which the company is being presented with. To that end, the board is actively engaged in talks with universities and other educational providers, as well as assessing further opportunities in the supported living sector, based on the model that we have successfully deployed at Wavertree and West Derby Road. .

Our business model allows us the flexibility to monetise our projects in different ways as our first two deals have shown. Both were pre-leased to housing associations then forward funded by financial institutions.

Our objective as a specialist in long term CPI-linked income for institutions continues, with our sector focus expanding. Real estate is not the only source of long-term income and as the Company grows we expect to be able to announce some interesting agreements within this focus. Throughout the period, the Company has been busy working with our consultants and several interested parties with regards to expanding our focus on larger deals, allowing us to take advantage of the forward funding model that we have used with the first two projects. As the new year progresses, I look forward to updating shareholders on further projects using our flexible business model and proof of concept deliverability."

For further information, please visit www.dukemountcapitalplc.com or contact:

Dukemount Capital Plc	Via St Swithins PR
Geoffrey Dart /Matt Thompson
St Swithins PR (Media and Investor Enquiries)	Tel: [phone]
Gary Middleton	[e-mail]
Peterhouse Capital Limited	Tel: [phone]
Lucy Williams/Duncan Vasey

Interim Management Report

I hereby present the Interim Report for the six months ended 31 October 2020.  During the period the Group made a loss of £156,947 (six months to 31 October 2019: loss of £82,469). These losses are consistent with the Group's run rate and arose in the course of pursuing transactions in its chosen sector; costs associated with its two projects; maintaining the Company's listing on the Official List of the UK Listing Authority by way of a standard listing and include: consultancy fees, professional fees and directors' fees

During the period, the board has pushed its existing projects towards completion, as well as entering into talks with regards to securing further long dated income opportunities.

This strategy has been helped by the appointment of Matthew Thompson as CEO within the period as well as other non-board appointments. Matthew's experience compliments that of the board and brings fresh ideas to the business model. He has already proven a valuable appointment, concentrating on getting our existing projects to completion this year, freeing up time for continuing talks with universities and investigations into new sources of long-dated income.

At the beginning of September 2020 we announced the practical completion of the Wavertree redevelopment project. The building and certificate have been handed over to the supported living housing association which has entered into a long-term lease agreement for the property.

In November 2020, we also announced the practical completion of the West Derby project, a full development site, which involved the demolition of a large structure and the building of 17 supported living apartments and 3,200 square feet of retail space.

Outlook

The global lockdown, whilst challenging, has given us the opportunity to look at other sources of long-dated income for institutions and the opportunities that the coming years may present. The property sector remains our core sector at present but other, industrial focused sectors, are being examined for their potential. The additional headcount at Dukemount frees up time for more in-depth research and discussions into other exciting opportunities outside property and I look forward to updating shareholders as the year progresses

I would like to take the opportunity to thank our shareholders for their support and the Dukemount team for their continuing efforts in driving this business forward.

Geoffrey Dart

On behalf of the Board

29 January 2021

Responsibility Statement

We confirm that to the best of our knowledge:

· the Interim Report has been prepared in accordance with International Accounting Standards 34, Interim Financial Reporting, as adopted by the EU;

· gives a true and fair view of the assets, liabilities, financial position and loss of the Group;

· the Interim Report includes a fair review of the information required by DTR 4.2.7R of the Disclosure and Transparency Rules, being an indication of important events that have occurred during the first six months of the financial year and their impact on the set of interim financial statements; and a description of the principal risks and uncertainties for the remaining six months of the year; and

· the Interim Report includes a fair review of the information required by DTR 4.2.8R of the Disclosure and Transparency Rules, being the information required on related party transactions.

The Interim Report was approved by the Board of Directors and the above responsibility statement was signed on its behalf by:

Geoffrey Dart

Executive Chairman

29 January 2021

 

Consolidated Statement of Comprehensive Income

For the six months ended 31 October 2020

	Note	Group Unaudited 6months ended 31 Oct 2020	Group Unaudited 6months ended 31 Oct 2019	Group Audited Year ended 30 April 2020
		£	£	£
Continuing Operations
Revenue from contracts with customers	4	1,348,227	987,470	2,387,704
Cost of sales		(1,283,553)	(913,789)	(2,264,405)
Gross Profit		64,674	73,681	123,299
Administrative expenses		(221,621)	(156,158)	(454,955)
Operating loss		(156,947)	(82,477)	(331,656)
Interest received		-	8	7
Loss before taxation		(156,947)	(82,469)	(331,649)
Tax		-	-	-
Loss for the financial period attributable to equity owners		(156,947)	(82,469)	(331,649)
Total comprehensive (loss) attributable to the equity holders		(156,947)	(82,469)	(331,649)
Earnings per share
- Basic and diluted	5	(0.00035)	(0.00023)	(0.00090)

 

Consolidated Statement of Financial Position

At 31 October 2020

	Note	Group Unaudited 31 Oct 2020 £	Group Unaudited 31 Oct 2019 £	Group Audited 30 April 2020 £
ASSETS
Current assets:
Trade and other receivables	6	714,728	478,687	609,558
Cash and cash equivalents		58,969	290,025	408,411
Total Current assets		773,697	768,712	1,017,969
Total assets		773,697	768,712	1,017,969
LIABILITIES
Current liabilities:
Trade and other payables	7	769,652	664,021	927,051
Total Current liabilities		769,652	664,021	927,051
Total liabilities		769,652	664,021	927,051
NET ASSETS		4,045	104,691	90,918
Capital and reserve attributable to the equity holders of the Parent
Share capital		454,283	366,166	439,033
Share premium		1,007,035	789,671	952,211
Share based payments reserve		30,499	30,499	30,499
Retained earnings		(1,487,772)	(1,081,645)	(1,330,825)
TOTAL EQUITY		4,045	104,691	90,918

 

Consolidated Statement of Changes in Equity

For the six months ended 31 October 2020

	Share capital	Share premium	Share based payment reserve	Retained losses	Total shareholder equity
	£	£	£	£	£
Balance as at 1 May 2019	366,166	789,671	30,499	(999,176)	187,160
Loss for the period	-	-	-	(82,469)	(82,469)
Total comprehensive income for the period	-	-	-	(82,469)	(82,469)
Issue of ordinary shares	-	-	-	-	-
Total transactions with owners	-	-	-	-	-
Balance at 31 October 2019	366,166	789,671	30,499	(1,081,645)	104,691
Loss for the period	-	-	-	(249,180)	(249,180)
Total comprehensive income for the period	-	-	-	(249,180)	(249,180)
Issue of ordinary shares	72,867	162,540	-	-	235,407
Total transactions with owners	72,867	162,540	-	-	235,407
Balance as at 30 April 2020	439,033	952,211	30,499	(1,330,825)	90,918
Loss for the period	-	-	-	(156,947)	(156,947)
Total comprehensive income for the period	-	-	-	(156,947)	(156,947)
Issue of ordinary shares	15,250	54,824	-	-	70,074
Total transactions with owners	15,250	54,824	-	-	70,074
Balance at 31 October 2020	454,283	1,007,035	30,499	(1,487,772)	4,045

 

Consolidated Statement of Cashflows

For the six months ended 31 October 2020

	Group Unaudited 6 months ended 31 Oct 2020	Group Unaudited 6 months ended 31 Oct 2019	Group Audited Year ended 30 April 2020
	£	£	£
Operating activities
Loss before taxation	(156,947)	(82,469)	(331,649)
(Increase)/decrease in trade and other receivables	(105,170)	198,450	67,579
(Decrease) / increase in trade and other payables	(157,399)	149,121	412,151
Net cash used in operating activities	(419,516)	265,102	148,081
Cash Flows from Financing Activities
Net proceeds from issue of shares	70,074	-	234,407
Net Cash generated from Financing Activities	70,074	-	234,407
Increase/(Decrease) in cash and cash equivalents in period/ year	(349,442)	265,102	383,488
Cash and cash equivalents at beginning of period / year	408,411	24,923	24,923
Cash and cash equivalents at end of period / year	58,969	290,025	408,411

Notes to the Interim Report

For the six months ended 31 October 2020

1.  GENERAL INFORMATION

Dukemount Capital Plc (the "Company") is a company domiciled in England.  The interim report for the six months ended 31 October 2020 comprises the results of the Company and its subsidiaries (together referred to as the "Group").

The Company's registered office is located at 50 Jermyn Street, London, England, SW1Y 6LX.

2.  BASIS OF PREPARATION

The Interim Report, which includes the consolidated interim financial statements have been prepared in accordance with International Accounting Standard 34 'Interim Financial Reporting'. The Interim Report should be read in conjunction with the annual financial statements for the year ended 30 April 2020, which have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union.

The Interim Report for the period 1 May 2020 to 31 October 2020 is unaudited.  This report has not been reviewed by the company's auditors in accordance with the International Standard on Review Engagements 2410 issued by the Auditing Practices Board. In the opinion of the Directors the interim financial statements, included in the Interim Report, for the period presents fairly the financial position, and results from operations and cash flows for the period in conformity with the generally accepted accounting principles consistently applied. The interim financial statements incorporate unaudited comparative figures for the interim period 1 May 2019 to 31 October 2019 and extracts from the audited financial statements for the year ended 30 April 2020.

The Interim Report, which includes the interim financial statements, set out above does not constitute statutory accounts within the meaning of the Companies Act 2006.  It has been prepared on a going concern basis in accordance with the recognition and measurement criteria of International Financial Reporting Standards (IFRS) as adopted by the European Union.

Statutory financial statements for the year ended 30 April 2020 were approved by the Board of Directors on 22 October 2020 and delivered to the Registrar of Companies. The report of the auditors on those financial statements was unqualified.

Cyclicality

The interim results for the six months ended 31 October 2020 are not necessarily indicative of the results to be expected for the full year ending 30 April 2021. Due to the nature of the entity, the operations are not affected by seasonal variations at this stage.

Segmental Reporting

The Group only has one activity which is considered its only operating/reportable segment. As the subsidiaries grow and acquire additional properties and projects, management will then consider them as separate reportable segments. Therefore, the financial information of the single segment is the same as that set out in the Statement of Comprehensive Income, Statement of Financial Position, Statement of Changes in Equity and the Statement of Cashflows.

Going concern

The Group has assessed the Covid-19 impact on its ability to continue as a going concern. The group considers that the events arising from the Covid-19 outbreak do not impact on its use of the going concern basis of preparation nor do they cast significant doubt over the group's and company's ability to continue as a going concern for the period of at least twelve months from the date when the condensed interim financial statements are authorised for issue. The Directors, having made, due and careful enquiry, are of the opinion that the Group will have access to adequate working capital to meet its obligations over the next 12 months. The Directors therefore have made an informed judgement, at the time of approving these condensed interim financial statements, that there is a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. As a result, the Directors have adopted the going concern basis of accounting in the preparation of the condensed interim financial statements for the period ended 31 October 2020.

Risks and uncertainties

The key risks that could affect the Group's short and medium-term performance and the factors that mitigate those risks have not substantially changed from those set out in the Company's 2020 audited financial statements, a copy of which is available on the Company's website: http://www.dukemountcapitalplc.com.

The Directors consider the principal risk for the Group to be the maintenance of its cash reserves whilst it focuses on its new development projects and targets further transactions in the property sector.

The Group operates in an uncertain environment and is subject to a number of risk factors. The Directors consider the following risk factors to be of particular relevance to the Group's activities. The list is not exhaustive and other risk factors not presently known or currently deemed immaterial may apply. The key risk factors are summarised below:

Market conditions

Market conditions, including general economic conditions and their effect on exchange rates, interest rates and inflation rates, may impact the ultimate value of the Group regardless of its operating performance. The Group also faces competition from other organisations, some of which may have greater resources or be more established in a particular territory in the property sector.

In particular, the Group has to marry up properties that are suitable for supported living tenants, in areas where there is a shortfall in demand for such properties, with the best Housing Associations and Care Providers who in turn are acceptable to funders.  This process is both time consuming and complex at times.

Adverse global economic conditions could limit the demand for property and lead to developments being postponed. This fall in demand could result in the business's operating results suffering in the future after any proposed transactions.

The Board considers and reviews all market conditions to try and mitigate any risks that may arise from these.

Impact of COVID-19

The impact of COVID-19 or any other severe communicable disease, if uncontrolled, on the general economic climate could have an adverse effect on the Group. The recent outbreak of COVID-19 may have an adverse effect on the Group's business, financial situation, growth and prospects and has already had a material adverse effect on overall business sentiment and the global economy. There is no assurance there will not be similar outbreaks of other diseases in the future. The impact of the imposition by governments across the world of stringent measures to prevent the spread of COVID-19 or other diseases, and the effect of COVID-19, or any other severe communicable diseases outbreak in the future, on the employees of the Group, could adversely affect the performance of the business activities of the Group and those of the customers, which could lead to a decrease in the demand for their services. It is too early to tell what the long‐term impact of COVID-19 will be on the Group's current and future prospects and to what extent it may have a material and adverse effect on the Group's business, results of operations and financial performance.

Government and Local Authority Support

In circumstances where the Group might seek to sell the long-term income from the leases of Supported Living properties, the 'blue chip' nature of this income would appear considerably less attractive to funds should the financial support from the State be perceived as not readily available in the case of a failed Housing Association.

Development Costs and Timing

Failure to estimate development and refurbishment costs accurately could result in the Group not meeting forecast profitability.  Delays in the completion of a project could add to increased costs and a loss of credibility for future projects.

Brexit

The effect on the Group of Brexit is unknown. There may be issues raising funds from investors in the short term, however investor markets in the UK have continued to be strong and it is too early to say if there will be any direct impact. The Directors continue to monitor the effects they will assess the impact to the Group and take appropriate steps as required.

Financing and interest rate risk

The Group may not be successful in procuring the requisite funds on terms which are acceptable to it (or at all) and, if such funding is unavailable, the Group may be required to reduce the scope of future transactions. Further, Shareholders' holdings of Ordinary Shares may be materially diluted if debt financing is not available.

Critical accounting estimates and judgements

The preparation of the interim financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the end of the reporting period. The critical accounting estimates and judgements made are in line with those made in the audited financial statements for the year ended 30 April 2020.

3.  ACCOUNTING POLICIES

The accounting policies applied in preparing the interim financial statements are consistent with those that have been adopted in the Company's 2020 audited financial statements with the exception of the new standards adopted as of 1 January 2020 included below.

The same accounting policies, presentation and methods of computation have been followed in these condensed interim financial statements as were applied in the preparation of the Group's annual financial statements for the year ended 30 April 2020 except for the impact of the adoption of the Standards and interpretations described below.

In issue but not effective for periods commencing on 1 May 2020

The following standards, amendments and interpretations which have been recently issued or revised and are mandatory for the Group's and Company's accounting periods beginning on or after 1 May 2020 or later periods have not been adopted early:

IFRS standards (amendments) - References to the Conceptual Framework (effective 1 January 2020)

IFRS3 - amendments to IFRS3 Business Combinations (effective 1 January 2020)

IAS 1 and IAS 8 - definition of material (effective 1 January 2020)

The Directors are evaluating the impact of the new and amended standards above. The Directors believe that these new and amended standards are not expected to have a material impact on the financial statements of the Group.

4.  REVENUE

Revenue relates to amounts contractually due under a property development agreement at the balance sheet data relating to the stage of completion of a contract as measured by surveys of work performed to date. Revenue is recognised for services when the Group has satisfied its contractual performance obligation in respect of the services.  The amount recognised for the services performed is the consideration that the Group is entitled to for performing the services provided. Revenue from contracts with customers is recognised over time.

	Group Unaudited 31 Oct 2020	Group Unaudited 31 Oct 2019	Group Audited 30 April 2020
	£	£	£
Revenue from contracts with customers	1,348,227	987,470	2,387,704

5.  EARNINGS PER SHARE

The basic loss per share is derived by dividing the loss for the period attributable to ordinary shareholders by the weighted average number of shares in issue.

	Group Unaudited 31 Oct 2020	Group Unaudited 31 Oct 2019	Group Audited 30 April 2020
	£	£	£
Loss for the period	(156,947)	(82,469)	(331,649)
Weighted average number of shares - expressed in thousands	450,950	366,166	366,766
Basic earnings per share - expressed in pence	(0.00035)	(0.00023)	(0.00090)

6.  TRADE AND OTHER RECEIVABLES

	Group Unaudited 31 Oct 2020	Group Unaudited 31 Oct 2019	Group Audited 30 April 2020
	£	£	£
Trade and other receivables	30,623	68,212	327,075
Amounts recoverable on contracts	684,105	410,475	282,483
	714,728	478,687	609,558

Amounts recoverable on contracts represents sales invoices issued after the period end in respect of work undertaken during the period with appropriate provision being made in accruals and deferred income for costs incurred in undertaking such work but which had not been invoiced at the period end.

7.  TRADE AND OTHER PAYABLES

	Group Unaudited 31 Oct 2020	Group Unaudited 31 Oct 2019	Group Audited 30April 2020
	£	£	£
Trade and other payables	264,016	338,302	386,664
Accruals	93,500	20,550	114,449
Accrued property costs	412,136	305,169	425,938
	769,652	664,021	927,051

Accrued costs represents the cost of property development work undertaken as at the period end.

8.   APPROVAL OF INTERIM FINANCIAL STATEMENTS

The Condensed interim financial statements were approved by the Board of Directors on 29 January 2021.

 

END

 

 

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