Interim Results

RNS Number : 5856F

Access Intelligence PLC

19 July 2021

 

ACCESS INTELLIGENCE PLC

("Access Intelligence", the "Company" or the "Group")

INTERIM RESULTS

 

Access Intelligence Plc, (AIM: ACC) the technology innovator delivering Software-as-a-Service (SaaS) solutions for the global marketing and communications industries, is pleased to announce its unaudited half year results for the six months ended 31 May 2021.

Highlights:

· Annual Contract Value ("ACV") base increased by £2.7 million (25% annualised) to £24.7 million (H1 2020: growth of £1.1 million to £19.1 million). Over the 12 month period to 31 May 2021, ACV increased by £5.5 million (29% organic growth).

· The Group's first half revenue increased by approximately 17% to £11.0 million (H1 2020: £9.4 million).

·   The Group delivered an Adjusted EBITDA* loss in the period of £135,000 (H1 2020: loss of £147,000), reflecting additional investment in sales and marketing to drive global expansion.

· Encouraging progress already being made in North America with a number of blue chip customer contracts won in the period and the region contributing 23% of total ACV growth in the period.

· At 31 May 2021, cash balance was £8.8 million (H1 2020: £2.6 million and FY 2020: £1.4 million).

· In December 2020, the Group announced an oversubscribed placing of 12,500,000 ordinary shares to raise gross proceeds of £10.0 million. The net proceeds of £9.6 million are to be used to enhance the Group's technology and platform of products, for further geographic expansion, to continue to explore suitable acquisition opportunities in line with the Group's strategy and to further strengthen its balance sheet.

· Post period end, in June 2021, the Group announced the terms of a recommended acquisition of the entire issued and to be issued ordinary share capital of Isentia Group Limited ('Isentia') for an equity valuation of approximately AUD$35.6 million (£19.4 million). The acquisition will be funded by an oversubscribed conditional placing of 39,847,658 ordinary shares and a conditional subscription for 1,819,009 ordinary shares to raise aggregate gross proceeds of £50.0 million. The proceeds will also be used to repay Isentia's gross debt of approximately AUD$45 million (£24.6 million).

· The acquisition of Isentia will enable the Company to benefit from greater scale, a superior product offering and greater geographic reach. It also represents an opportunity to scale Access Intelligence's sales infrastructure into the fast-growing APAC market and is an ideal platform for cross-selling opportunities for Access Intelligence's Pulsar audience intelligence and social listening platform.

· Strengthened board as the company expands its geographic reach:

o  Sarah Vawda appointed to the Board as Non-Executive Director and Chair of the Group's Audit Committee in March 2021. Sarah is currently Corporate Development Director for Johnson Matthey plc and is a highly experienced executive and non-executive director with expertise across corporate strategy, M&A, finance, corporate governance and corporate development.

o  Katie Puris appointed to the Board as Non-Executive Director in June 2021. Katie is the Managing Director of Global Business Marketing for TikTok, where she leads a creative marketing team and drives awareness of TikTok's innovative digital marketing solutions that give brands and marketers the tools to be creative storytellers and challenge the status quo.

Christopher Satterthwaite, non-executive Chairman, commented:

"I'm delighted that Access Intelligence continues to deliver strong organic growth due to its exceptional people and products. The expanding market opportunity and appetite for the Group's products and services is clear with continued growth in both revenue and customer retention.

Growth has been capitalised on with significant investment in product innovation and operational scale accelerating expansion into North America and APAC for the second half of the year and the future."

* Adjusted EBITDA is earnings before interest, tax, depreciation and amortisation and adjusted for share based payments, share of losses of an associate and non-recurring expenses primarily relating to acquisition costs in respect of the proposed Isentia transaction in the current and prior periods, in addition to the acquisition and integration of Pulsar in the prior period.

For further information:

Access Intelligence plc  020 3426 4024

Joanna Arnold (CEO) / Mark Fautley (CFO)   

finnCap Limited (Nominated Adviser and Broker)   020 7220 0500

Corporate Finance:

Marc Milmo / Kate Bannatyne / Fergus Sullivan     

Corporate Broking:

Alice Lane / Sunila de Silva

Prior to publication, the information contained within this announcement was deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 ("MAR"). With the publication of this announcement, this information is now considered to be in the public domain.

 

Chairman's statement

I am pleased to announce our unaudited interim results for the six months ended 31 May 2021.

Access Intelligence has had a strong first half of 2021, delivering sustained organic growth momentum alongside significant progress against the Group's strategy, built around five key pillars:

· Innovation - Developing an integrated marketing intelligence proposition that spans from analytics to activation and encompasses the products we currently offer as well as the ongoing development of our offering and technologies we are acquiring

· Transformation - Leading and preparing the industry for a new world of data-driven marketing and showing organisations and practitioners what success looks like.

· Expansion - Focusing on organic growth for the most mature and sophisticated markets, while deploying partnerships and seeking acquisitions in the newest, up-and-coming markets.

· Customer experience - Optimising our suite of products to deliver the best customer experience in the industry, underpinned by empowering customers with a self-service model to maximise operational gearing as we scale globally.

· Ethics - Protecting the public and our customers by promoting and developing market best practice in the use of data that support privacy, consent, and transaction transparency as a priority.

Continued growth

The Group has delivered 25% annualised organic growth in ACV in the first half, with growth over the last 12 months exceeding 29%. The growth in ACV has been underpinned by a 48% increase in new business ACV compared to H1 2020, alongside an 8 percentage point increase in renewal rates, and has contributed to a 17% increase in revenue compared to H1 2020.

Throughout the pandemic, we have seen high demand for audience understanding and intelligence, particularly via social listening, alongside the means to operate complex marcoms strategies. Our integrated platform supports brands, agencies, non-profits, and public sector organisations as they deliver against their increasingly demanding objectives. Now our technologies have been proven in established markets, there is a clear opportunity to take advantage of untapped markets in rapidly growing regions as part of our global expansion strategy.

The Group's continued ACV growth enables sustained investment in the technical capabilities of the Group's product platform alongside further scaling of its commercial operations. The investment made during 2021 into marketing, commercial enablement and sales has specifically targeted enterprise sized clients and prospects and is already showing fruition with an increased average ACV of new business wins for both enterprise software and insights. These high growth areas are a testament to the Group's new premium positioning and are areas that we will keep investing in as we continue to expand our global footprint.

The Group's pursuit of excellence is demonstrated by the type of clients who have developed their relationships with us, either internally or through advocating our services to their external stakeholders. The Twitter partnership, for example, has resulted in Pulsar's analytics being employed across clients including Google, Spotify, and Verizon. Similarly, our Amazon relationship continues to expand into new parts of its business, including live-streaming platform Twitch.

Strategic progress

A key pillar of our strategy focuses on Expansion, primarily in the European, North American & APAC markets.

The Group has its roots in the European market with a nascent but fast-growing operation in North America and it is these two markets that have contributed to the 29% ACV growth over the last 12 months. The Group is focused on delivering organic growth in Europe and North America and, during the first half, completed a £10m fundraise (before expenses) with a significant proportion of the proceeds being allocated for expansion of the Group's North America sales and marketing activity.

Progress in building out the North America sales and marketing team is ahead of expectations with 13 new hires made in the period and all key roles now filled. In addition, there are multiple candidates for 'Phase 2' hiring that are in process with targeted start dates in August and September 2021. This team is now building an exciting pipeline of opportunities with North America having already contributed 23% of total ACV growth in the first half.

As the fastest growing market for social, the Group's strategy for APAC is focused on acquisitions and partnerships. In June 2021, the Group announced the recommended acquisition of Isentia. Isentia is the market leader for media intelligence and insights in APAC, operating across eight geographical markets covering Australia, New Zealand and South-East Asia working with c.2,400 customers.

The acquisition of Isentia will enable the Company to benefit from greater scale, a superior product offering and greater geographic reach. It will provide an established commercial and operational infrastructure to enhance our organic expansion of social media into the APAC market, alongside exceptional localised knowledge, teams, products, and services. It also provides an enviable blue chip and government client base for upsell and cross sell opportunities. Indeed, Access Intelligence is already starting to work with Isentia on specific opportunities to partner the Group's social products with Isentia's existing media intelligence products in the APAC region.

The Group has also made good progress against other elements of its strategy.  Innovation is being fueled through back-end data processing and data science, with new releases including a first party data solution for brands to be able to ingest primary text, visual and statistical datasets, from customer feedback to sales performance and stock market data. This enables clients to leverage the Group's data mining, AI and visualisation technologies to analyse their proprietary data alongside the Group's other data sources, to provide a real 360 view of their customers and other stakeholders, alongside their interactions with the organisation's reputation, communications narratives, brands and products. Additional data sets have also been added to the Group's product offering to support accelerating international growth.

The appointment of a new Chief Operating Officer ('COO') during the first half forms a key part of the Group's plan to enhance and scale customer service operations globally. With a background in scaling successful operations and customer service teams for global data businesses, the COO's remit is to deliver best in industry customer service whilst enabling a self-service model to maximise operational gearing as the Group scales into new geographies. 

Board changes

The Group is delighted to have welcomed Sarah Vawda and Katie Puris to the Board as Non-Executive Directors. Both pioneers within their respective industries, Sarah and Katie bring vast experience while maintaining a desire to drive real change from a company performance and corporate responsibility standpoint. They are already providing invaluable insight to the board and the wider organisation.

Sarah brings tremendous strategic, M&A and finance experience from a range of positions and industries that will help Access Intelligence develop on the foundations that have been built in recent years. As Chair of the Audit Committee she will play a key role in ensuring good corporate governance as the Group continues to expand both organically and through acquisition.

Sarah is passionate about and engaged in the diversity debate and is a Trustee and Audit Committee Chair of The Girls Network, a charity that provides mentoring to girls from disadvantaged backgrounds. She will enable the Group's accessmatters initiative for diversity and organisational inclusion, designed to encourage listening, sharing of experience and best practice while promoting collaboration around the actions that will have greatest positive impact on our industry and our society.

Katie couldn't be more aptly placed to contribute to our vision and purpose as she's at the forefront of how the explosion of digital content generated by audiences is changing how brands and society behave. Her role as Managing Director of Global Business for TikTok and history at Google, Facebook and BBDO has uniquely aligned her with our vision and how we bring it to different markets around the world.

Katie also serves on the board of two education-based non-profits - the Windward School, supporting children with learning disabilities, and Hudson Link, providing higher education to incarcerated men and women.

The welcome addition of Sarah and Katie is also a phenomenal milestone for something that we deeply care about, which is to increase the diversity of genders and ethnicities, and their representation within the Group. The first milestone for this is that we now have a gender balanced board. This is vital for inspiring the next generation of leaders within the company and is something that we are taking to the industry too by joining the 30% club, which sets the goal for all companies to have at least 30% female representation on their boards. This will be finalised after the acquisition of Isentia, however we are already providing pro-bono services to the organisation.

Results for the half year

The primary key performance indicator monitored by the Board is the growth in the ACV base year-on-year. This reflects the annual value of new business won, together with upsell into the Company's existing customer base as it delivers against its land and expand strategy, less churn. It is an important metric for the Group as it is a leading indicator of future revenue.

During the period, the Group's ACV base grew by £2.7 million (25% annualised) to £24.7 million (H1 2020: growth of £1.1 million to £19.1 million). Over the full 12 month period to 31 May 2021, ACV increased by £5.5 million (29% organic growth).

Revenue for the period grew by 17% to £11.0 million (H1 2020: £9.4 million). The year-on-year increase was primarily driven by ACV growth resulting from strong new business performance alongside continued improvements in the Group's renewal rates. Recurring revenue comprised 94% of total revenue (H1 2020: 94%).

Gross profit increased by 22% year-on-year to £8.1 million (H1 2020: £6.6 million) with the Group delivering a gross margin of 74% (H1 2020: 71%). Gross margin improved compared to the prior period as the Group is able to leverage fixed cost data feeds more effectively as its revenue increases.

Adjusted earnings before interest, tax, depreciation and amortisation ("EBITDA") were a loss of £135,000 compared to a loss £147,000 in H1 2020. Adjusted EBITDA excludes certain non-recurring items totalling £1,332,000 for the period (H1 2020: £730,000), in addition to the Group's share of loss of an associate of £71,000 (H1 2020: £74,000) and a share-based payments charge of £72,000 (H1 2020: £46,000).

Non-recurring items in the period included acquisition related legal and due diligence costs of £1,332,000 (H1 2020: £Nil) and transition and migration costs in respect of acquisitions of £Nil (H1 2020: £730,000). Reported EBITDA loss was £1,610,000 (H1 2020: loss of £997,000).

The Group increased its investment in the Vuelio and Pulsar platforms with identifiable new product development activity being capitalised. The Group capitalised development costs of £1,248,000 for the period (H1 2020: £958,000), with a further £723,000 (H1 2020: £782,000) of product, research and development costs being expensed through profit and loss.

The Group's operating loss was £3,263,000 (H1 2020: loss £2,683,000). The Group incurred £1,653,000 of depreciation and amortisation charges (H1 2020: £1,686,000).

The basic loss per share was 4.07p (H1 2020: loss 3.91p).

On 9 December 2020, the Group announced a placing of 12,500,000 ordinary shares at a price of 80 pence per share to raise gross proceeds of £10,000,000. The net proceeds of £9,630,000 are to be used to enhance the Group's technology and platform of products, for further geographic expansion, to continue to explore suitable acquisition opportunities in line with the Group's strategy and to further strengthen its balance sheet.

The Group also announced on 9 December 2020 that it had secured a £2 million, three year facility under the Coronavirus Business Interruption Loan Scheme (CBILS). The facility was drawn down during December 2020, has a 12-month interest-free period following drawdown and an interest rate of 2.03% plus LIBOR or replacement benchmark rate per annum on the drawn down amount thereafter. The funds are repayable in equal monthly instalments over 36 months and there will be no penalty for making early repayment of the facility. The CBILS loan will be repaid in full on completion of the acquisition of Isentia.

The Group held cash at the end of the period of £8,773,000 (H1 2020: £2,647,000).

Events after the reporting date

On 15 June 2021, the Group announced that the boards of Access Intelligence and Isentia have agreed the terms of an acquisition pursuant to which Access Intelligence will acquire Isentia for an equity valuation of approximately AUD$35.6 million (£19.4 million).

The acquisition also means that the Company will acquire Isentia's existing senior debt and other indebtedness. To fund the equity consideration of the acquisition and repay the full amount of the drawn down debt of Isentia, the Group also announced a placing of 39,847,658 ordinary shares and a subscription for 1,819,009 ordinary shares to raise aggregate gross proceeds of £50.0 million.

The acquisition is being effected by a Court approved scheme of arrangement between Isentia and Isentia shareholders in New South Wales, Australia. The fundraise and acquisition of Isentia were approved at a General Meeting of the Company on 9 July 2021. The Australian court process is ongoing.

On 14 June 2021, the Company entered into a spot exchange option to protect against fluctuations in foreign currency exchange rates in respect of the risk of the proceeds of the placing being payable in sterling but the consideration due under the acquisition being payable in AUD$. The agreement provides the Company with a foreign exchange option to sell GBP and buy AUD$70.0 million.

On 15 June 2021 the Group and Spheria Asset Management Pty entered into a share purchase agreement whereby the Group agreed to purchase 39,708,447 fully paid ordinary shares in Isentia Group Limited from Spheria Asset Management Pty for an aggregate purchase price of AUD$6.9 million.

On 15 June 2021, the Company also announced a retail offer via PrimaryBid of up to £2.0 million to facilitate retail participation in the company's shares. Following the successful closing of the retail offer, the Company raised gross proceeds of approximately £1.45 million.

On 16 July 2021, the First Court Hearing was held at which the Supreme Court of New South Wales approved, inter alia, the distribution of the scheme booklet to Isentia's shareholders which includes the notice of the scheme meeting, the recommendation of the board of Isentia and the independent expert's report. The independent expert, KPMG, has determined that, in the absence of a superior proposal, the scheme is fair and reasonable and therefore in its opinion in the best interests of Isentia shareholders.

Further information on events after the reporting date is contained within Note 5.

Outlook

The Group's focus in 2021 is about putting a platform in place to expand our product proposition globally whilst continuing to scale in our established markets through increased sales and improved customer retention.

The Group's ongoing investment in its products and operations will provide customers with a better user experience and a more diverse range of services, while the expansion of our North America commercial team is expected to drive a significant increase in ACV from that market.

Completion of the acquisition of Isentia in September 2021 will demonstrate the expanded Group's ambition to leverage its proprietary technology for broadcast inputs, extensive global client roster and reach into markets seeking the combination of traditional media insight combined with the latest in social intelligence.

The directors remain very positive about the outlook for the Group. The first half has seen sustained growth momentum whilst we have implemented further enhancements to the Group's products and operations to facilitate accelerated expansion into North America and APAC in the second half and beyond.

Christopher Satterthwaite

Non-executive Chairman

 

Access Intelligence Plc

Consolidated Statement of Comprehensive Income

for the six months ended 31 May 2021

	Unaudited 6 months ended	Unaudited 6 months ended	Audited Year ended
	31-May-21	31-May-20	30-Nov-20
	£'000	£'000	£'000
Revenue	11,000	9,379	19,070
Cost of sales	(2,875)	(2,733)	(5,314)
Gross profit	8,125	6,646	13,756
Recurring administrative expenses	(8,260)	(6,793)	(13,070)
Adjusted EBITDA	(135)	(147)	686
Non-recurring administrative expenses	(1,332)	(730)	(2,479)
Share of loss of associate	(71)	(74)	(160)
Share-based payments	(72)	(46)	(107)
EBITDA	(1,610)	(997)	(2,060)
Depreciation of tangible fixed assets	(110)	(109)	(228)
Depreciation of right-of-use assets	(325)	(321)	(645)
Amortisation of intangible assets - internally generated	(672)	(525)	(1,162)
Amortisation of intangible assets - acquisition related	(546)	(731)	(1,280)
Operating loss	(3,263)	(2,683)	(5,375)
Financial income	10	2	6
Financial expense	(169)	(187)	(377)
Loss before tax	(3,422)	(2,868)	(5,746)
Taxation credit	50	48	660
Loss for the period	(3,372)	(2,820)	(5,086)
Other comprehensive income	(13)	-	(8)
Total comprehensive loss for the period attributable to the owners of parent company	(3,385)	(2,820)	(5,094)
Earnings per share:
Basic loss per share	(4.07)p	(3.91)p	(7.06)p
Diluted loss per share	(4.07)p	(3.91)p	(7.06)p

Access Intelligence Plc

Consolidated Statement of Financial Position

at 31 May 2021

	Unaudited		Unaudited		Audited
	As at		As at		As at
	31-May-21		31-May-20		30-Nov-20
	£'000		£'000		£'000
Non-current assets
Intangible assets	15,786		15,880		15,732
Investment in associate	873		43		57
Property, plant and equipment	411		641		496
Right-of-use assets	2,005		2,624		2,329
Deferred tax assets	18		21		18
Total non-current assets	19,093		19,209		18,632
Current assets
Trade and other receivables	7,786		6,429		5,976
Current tax receivables	548		617		548
Cash and cash equivalents	8,773		2,647		1,403
Total current assets	17,107		9,693		7,927
TOTAL ASSETS	36,200		28,902		26,559
Current liabilities
Trade and other payables	3,516		4,941		4,412
Accruals	2,138		836		1,209
Contract assets	9,928		8,105		8,122
Lease liabilities	796		277		558
Interest bearing loans and borrowings	667		12		-
Total current liabilities	17,045		14,171		14,301
Non-current liabilities
Provisions	213		213		213
Lease liabilities	2,003		2,626		2,441
Interest bearing loans and borrowings	1,064		-		-
Deferred tax liabilities	474		595		520
Total non-current liabilities	3,754		3,434		3,174
TOTAL LIABILITIES	20,799		17,605		17,475
NET ASSETS	15,401		11,297		9,084
Equity
Share capital	4,382		3,961		3,757
Treasury shares	(148)		(148)		(148)
Share premium account	26,247		17,242		17,242
Capital redemption reserve	395		191		395
Share option reserve	590		457		518
Other reserve	502		502		502
Retained earnings	(16,567)		(10,908)		(13,182)
TOTAL EQUITY ATTRIBUTABLE TO EQUITY SHAREHOLDERS	15,401		11,297		9,084

Access Intelligence Plc

Consolidated Statement of Changes in Equity

for the six months ended 31 May 2021

	Share	Treasury	Share	Capital	Share	Other	Retained	Total
	capital	Shares	premium	redemption	option	reserve	earnings
			account	reserve	reserve
	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000
At 1 December 2019	3,961	(148)	17,242	191	411	502	(8,088)	14,071
Total comprehensive income for the period	-	-	-	-	-	-	(2,820)	(2,820)
Share-based payments	-	-	-	-	46	-	-	46
At 31 May 2020	3,961	(148)	17,242	191	457	502	(10,908)	11,297
Total comprehensive income for the period	-	-	-	-	-	-	(2,274)	(2,274)
Share-based payments	-	-	-	-	61	-	-	61
Repurchase of share capital	(204)	-	-	204	-	-	-	-
At 30 November 2020	3,757	(148)	17,242	395	518	502	(13,182)	9,084
Total comprehensive income for the period	-	-	-	-	-	-	(3,385)	(3,385)
Share-based payments	-	-	-	-	72	-	-	72
Issue of share capital	625	-	9,005	-	-	-	-	9,630
At 31 May 2021	4,382	(148)	26,247	395	590	502	(16,567)	15,401

 

Access Intelligence Plc

Consolidated Statement of Cash Flow

for the six months ended 31 May 2021

	Unaudited 6 months ended		Unaudited 6 months ended		Audited Year ended
	31-May-21		31-May-20		30-Nov-20
	£'000		£'000		£'000
Loss for the year attributable to shareholders	(3,385)		(2,820)		(5,094)
Adjustments for:
Taxation	(50)		(48)		(660)
Depreciation and amortisation	1,653		1,686		3,315
Share based payments	72		46		107
Share of loss of associate	71		74		160
Financial income	(10)		(2)		(6)
Financial expense	169		187		377
Operating cash outflow before working capital changes	(1,480)		(877)		(1,801)
(Increase)/decrease in trade and other receivables	(1,810)		1,408		1,764
Increase in trade and other payables	1,838		1,171		1,308
Net cash (outflow)/inflow from operations	(1,452)		1,702		1,271
Tax received	-		378		987
Net cash (outflow)/inflow from operating activities	(1,452)		2,080		2,258
Investing
Interest received	10		2		6
Acquisition of property, plant and equipment	(26)		(118)		(128)
Acquisition of software licences and other intangible assets	(19)		(34)		(58)
Cost of software development	(1,248)		(958)		(1,973)
Investment in associate	(887)		-		-
Loan to associate	-		(100)		(100)
Net cash outflow from investing activities	(2,170)		(1,208)		(2,253)
Financing
Interest paid	(169)		(187)		(377)
Drawdown of loans	2,000		-		-
Repayment of loans	(269)		(11)		(23)
Lease liabilities paid	(200)		(28)		(203)
Issue of shares (net of expenses)	9,630		-		-
Net cash inflow/(outflow) from financing activities	10,992		(226)		(603)
Net increase/(decrease) in cash	7,370		646		(598)
Opening cash and cash equivalents	1,403		2,001		2,001
Closing cash and cash equivalents	8,773		2,647		1,403

Notes

1.  Unaudited notes

Basis of preparation and accounting policies

The financial information for the six months to 31 May 2021 is unaudited and was approved by the Board of Directors on 18 July 2021.

The interim financial statements do not include all of the information required for full annual financial statements and should be read in conjunction with the consolidated financial statements for the year ended 30 November 2020.

The interim financial information for the six months ended 31 May 2021, including comparative financial information has been prepared on the basis of the accounting policies set out in the last annual report and accounts.

The preparation of the interim financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expense. Actual results may subsequently differ from those estimates.

In preparing the interim financial statements, the significant judgements made by management in applying the Group's accounting policies and key sources of estimation uncertainty were the same, in all material respects, as those applied to the consolidated financial statements for the year ended 30 November 2020.

The Group has elected to present comprehensive income in one statement.

Going concern assumption

The Group meets its day to day working capital requirements through its cash balance. During the period the Group has put in place a £2,000,000 CBILS loan of which £1,731,000 was outstanding at 31 May 2021. In addition, the Group raised £9,630,000 net of expenses during the period to enhance the Group's technology and platform of products, for further geographic expansion, to continue to explore suitable

acquisition opportunities in line with its strategy and to further strengthen its Balance Sheet.

Consequently, after making enquires, the Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis of accounting in preparing the interim financial statements.

Information extracted from the Group's 2020 Annual Report

The financial figures for the year ended 30 November 2020, as set out in this report, do not constitute statutory accounts but are derived from the statutory accounts for that financial year.

The statutory accounts for the year ended 30 November 2020 were prepared under IFRS and have been delivered to the Registrar of Companies. The auditors reported on those accounts. Their report was unqualified, did not draw attention to any matters by way of emphasis and did not include a statement under Section 498(2) or 498(3) of the Companies Act 2006.

2.  Earnings per share

The calculation of earnings per share is based upon the loss after tax for the respective period. The weighted average number of ordinary shares used in the calculation of basic earnings per share is based upon the number of ordinary shares in issue in each respective period.

The impact of share options granted under the company's share option are anti-dilutive due to the Group being in a loss-making position, so the weighted average number of ordinary shares used in the calculation of diluted earnings per share is the same as for basic earnings per share.

This has been computed as follows:

	6 months ended	6 months ended	6 months ended	6 months ended	Year ended	Year ended
	31-May-21	31-May-21	31-May-20	31-May-20	30-Nov-20	30-Nov-20
	Basic	Diluted	Basic	Diluted	Basic	Diluted
Loss after tax (£'000)	(3,385)	(3,385)	(2,820)	(2,820)	(5,094)	(5,094)
Number of shares ('000)*	83,190	83,190	72,180	72,180	72,180	72,180
Loss per share (pence)	(4.07)	(4.07)	(3.91)	(3.91)	(7.06)	(7.06)

3.  Investment in associate

During the period, the Group increased its investment in Track Record Holdings Limited by £887,000 (H1 2019: £Nil) through participation in a fundraise. The Group now holds 21.4% of Track Record Holdings Limited's allotted share capital.

4.  Share capital

On 9 December 2020, the Group announced a placing of 12,500,000 ordinary shares at a price of 80 pence per share to raise gross proceeds of £10,000,000, with net proceeds after expenses being £9,630,000.

7,922,280 ordinary shares were allotted and admitted to trading on AIM on 15 December 2020 and 4,577,720 ordinary shares were allotted and admitted to trading on AIM on 5 January 2021.

5.  Events after the reporting date

On 15 June 2021, the Group announced that the boards of Access Intelligence and Isentia Group Limited ('Isentia') have agreed the terms of an acquisition pursuant to which Access Intelligence (through its Australian subsidiary) will acquire the entire issued and to be issued ordinary share capital of Isentia for an equity valuation of approximately AUD$35.6 million (£19.4 million), valuing each Isentia share at AUD$0.175 (£0.095).

As the acquisition will see the Company acquire Isentia, the acquisition also means that the Company will acquire Isentia's existing senior debt and other indebtedness. The Company will procure the repayment of Isentia's senior debt and other indebtedness as soon as practicable following implementation.

In order to fund the equity consideration of the acquisition and repay the full amount of the drawn down debt of Isentia, the Group announced a placing of 39,847,658 ordinary shares and a subscription for 1,819,009 ordinary shares at the placing price of 120 pence per new ordinary share to raise aggregate gross proceeds of £50.0 million.

The acquisition is being effected by a Court approved scheme of arrangement between Isentia and Isentia shareholders in New South Wales, Australia. The scheme will become effective and will be binding on Isentia and Isentia shareholders once a copy of the court order approving the scheme is lodged with the Australian regulator, ASIC.

The fundraise and acquisition of Isentia are conditional, inter alia, on:

· approval of the Scheme by Isentia shareholders;

· approval of the Court;

· Isentia continuing to operate its business in the ordinary course and no material change to its business occurring; and

· the parties' respective warranties being true and correct in all material respects.

The fundraise and acquisition of Isentia were approved at a General Meeting of the Company on 9 July 2021. The Australian court process is ongoing.

On 14 June 2021 the Company entered into a spot exchange option through Silicon Valley Bank to protect against fluctuations in foreign currency exchange rates in respect of the risk of the proceeds of the Placing being payable in sterling but the consideration due under the Acquisition being payable in AUD$. The agreement provides the Company with a foreign exchange option to sell GBP and buy AUD$70.0 million.

In addition to and separately from the Scheme, on 15 June 2021 the Group and Spheria Asset Management Pty entered into a share purchase agreement whereby the Group, through its subsidiary Vuelio Australia Pty Ltd agreed to purchase 39,708,447 fully paid ordinary shares in Isentia Group Limited from Spheria Asset Management Pty for an aggregate purchase price of AUD$6.9 million.

On 15 June 2021, the Company also announced a retail offer via PrimaryBid of up to £2.0 million to facilitate retail participation in the company's shares. Following the successful closing of the retail offer, the Company raised gross proceeds of approximately £1.45 million at 120 pence per ordinary share.

On 16 July 2021, the First Court Hearing was held at which the Supreme Court of New South Wales approved, inter alia, the distribution of the scheme booklet to Isentia's shareholders which includes the notice of the scheme meeting, the recommendation of the board of Isentia and the independent expert's report. The independent expert, KPMG, has determined that, in the absence of a superior proposal, the scheme is fair and reasonable and therefore in its opinion in the best interests of Isentia shareholders.

6.  Availability of interim results

The interim results will not be sent to shareholders but will be available at the Company's registered office at The Johnson Building, 79 Hatton Garden, London, EC1N 8AW and on the Company's website: www.accessintelligence.com .

 

END

 

 

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