30 August 2024
SIVOTA PLC
("Sivota," or "the Company")
HALF YEAR RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2024
Sivota, the London-listed investment vehicle focused on later-stage Israeli technology companies, announces its results for the six months ended 30 June 2024 ("H1 2024").
Key financial highlights for the six months ended 30 June 2024:
o Net loss from continuing operations of $368,000 (H1 2023: $328,000)
o Net loss from discontinued operation of $6.0 million
o Cash as at 30 June 2024 of $142,000 (31 December 2023: $969,000)
o No debt as at 30 June 2024 (31 December 2023: $1.6 million).
Apester Ltd ("Apester")
As previously announced, at the end of June 2024, Sivota was informed by the board of Apester, its majority-owned subsidiary in Israel, that due to a deterioration in trading performance, it can no longer proceed as a going concern. Following legal advice Apester filed (the 'filing decision') for bankruptcy in the court of Tel Aviv.
Following the filing decision, the Company now presents Apester as a discontinued activity and recorded a loss of $830,000 from discontinued operations for the first six months of 2024.
At this time, Sivota cannot assess what, if any, recovery it will make in respect of its investment in Apester, although any recovery is likely to be minimal. As a result, the Company has recorded a loss from impairment of Apester's net assets in the amount of $5.2 million.
Termination of transaction negotiations
In May 2024 Sivota announced that negotiations for investment in a leading online technology platform operating across the travel sector, have been terminated. The Company remains committed to exploring further M&A activity and is evaluating its pipeline of opportunities.
Current trading and going concern
The Company continues to evaluate investment opportunities but will need to raise further debt or equity finance to fund its current business development pipeline. During 2024, the Company is expected to generate further losses from operations, which will be expressed in negative cash flows from operating activity. While the directors believe they will be able to raise the additional finance required, this is not guaranteed and hence, there is a material uncertainty with respect of the Company's going concern.
As of the signing of this report, the Company is a cash shell, and therefore there are no material effects of assuming a going-concern basis of accounting in preparing the financial statements.
Ziv Ben-Barouch, Chief Executive Officer of Sivota, commented:
"Despite announcing the filing decision of Apester and the termination of transaction negotiations with the online technology platform, we remain encouraged with our current pipeline and initial state of negotiations with potential prospects and remain confident at least one of these prospects will advance to signing a term sheet.
As funding within the technology sector remain challenging, we believe Sivota is well placed to benefit from opportunities it pursues. The board and management remain committed to securing new investment prospects and executing the company's strategy."
For further information, please visit www.sivotacapital.com or contact:
|
Sivota PLC Tim Weller, Non-Executive Chairman Ziv Ben-Barouch, Chief Executive Officer
|
via Vigo Consulting |
|
Canaccord Genuity Limited Bobbie Hilliam
|
+ 44 (0) 20 7523 8000 |
|
Vigo Consulting Jeremy Garcia |
+ 44 (0)20 7390 0230 |
This announcement contains inside information for the purposes of Article 7 of Regulation (EU) 596/2014.
Financial Review
Cash flow and net debt
The Company's cash balance as at 30 June 2023 was $142,000 compared to $969,000 as at 31 December 2023. As a result of Apester's disposal there was no debt as at 30 June 2024, compared to net debt of $1.6 million as at 31 December 2023.
Operation results
The Company's ongoing operations resulted in a loss of $368,000 in the six months ended 30 June 2024, compared to the loss of $328,000 in the same period in 2023.
The company's discontinued operation resulted in a loss of $6.0 million.
Current trading and outlook
The Company continues to evaluate investment opportunities.
Risk and uncertainties
The Company operates in an uncertain environment and is subject to several risk factors. The Directors have assessed the principal risks facing the Company, including those that threaten its business model, future performance, solvency, or liquidity.
The Company continues to monitor the principal risks and uncertainties to ensure that any emerging risks are identified, managed, and mitigated.
Financing
The Company intends to acquire further businesses, so it will need to raise further funds, although the war in Israel, as described below, may adversely affect the company's ability to raise additional funds.
Difficulties in acquiring suitable targets
The Company's strategy and future success are dependent to a significant extent on its ability to identify sufficient suitable acquisition opportunities and to execute these transactions on terms consistent with its strategy. If the Company cannot identify suitable acquisitions or execute any such transactions successfully, this will adversely affect its financial and operational performance.
Security, political and economic instability in Israel and the Middle East
Sivota seeks target companies based in Israel. Therefore, security, political, and economic conditions in the Middle East, particularly in Israel, may affect the Group's business directly.
The intensity and duration of Israel's ongoing war against Hamas is difficult to predict. While the operations and business of the target companies are not materially impacted by the ongoing war to date, future disruptions could materially adversely affect their business as a direct result of employees located in Israel called for reserve duty or of third parties boycotting business with Israeli companies as a political step.
Taxation
The Group will be subject to taxation in several different jurisdictions, and adverse changes to the taxation laws of such jurisdictions could negatively affect its profitability.
Statement of directors' responsibilities in respect of the interim results
The Directors being Tim Weller (Chairman), Ziv Ben-Barouch (CEO), and Neil Jones (Non-Executive) confirm that the set of interim financial statements has been prepared in accordance with International Accounting Standard 34 "interim financial reporting", and that interim report includes a fair review of the information required by DTR 4.2.7R and DTR 4.2.8R, namely an indication of important events that have occurred during the six months period ended 30 June 2024; and material related party transactions in the six months ended 30 June 2024.
SIVOTA PLC
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
U.S. dollars in thousands
The accompanying notes are an integral part of the condensed consolidated financial statements.
The condensed consolidated financial statements on page 5 to 14 were authorised for issue by the board of directors on 30 August 2024 and were signed on its behalf by Ziv Ben-Barouch.
Ziv Ben-Barouch, CEO,
30 August 2024
SIVOTA PLC
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
U.S. dollars in thousands
|
|
|
|
As at 30 June 2024 |
|
As at 31 December 2023 |
|
|
|
|
Unaudited |
|
Audited |
|
ASSETS |
|
|
|
|
|
|
Non-current assets |
|
|
|
|
|
|
Intangible assets, net |
|
|
- |
|
5,200 |
|
Property and equipment, net |
|
|
1 |
|
15 |
|
Total non-current assets |
|
|
1 |
|
5,215 |
|
Current assets |
|
|
|
|
|
|
Trade receivables |
|
|
- |
|
1,084 |
|
Other receivables |
|
|
29 |
|
249 |
|
Cash and cash equivalents |
|
|
142 |
|
969 |
|
Total current assets |
|
|
171 |
|
2,302 |
|
Total assets |
|
|
172 |
|
7,517 |
|
EQUITY AND LIABILITIES |
|
|
|
|
|
|
Equity |
|
|
|
|
|
|
Ordinary share capital |
|
|
157 |
|
157 |
|
Deferred shares |
|
|
65 |
|
65 |
|
Capital reserve from transactions with non-controlling interests |
|
|
- |
|
(426) |
|
Share premium |
|
|
15,139 |
|
15,139 |
|
Accumulated losses |
|
|
(15,597) |
|
(12,020) |
|
Total equity attributable to the owners |
|
|
(236) |
|
2,915 |
|
Non-controlling interests |
|
|
- |
|
1,203 |
|
Total equity |
|
|
(236) |
|
4,118 |
|
Current liabilities |
|
|
|
|
|
|
Current maturity of long-term loan from related party |
|
|
- |
|
727 |
|
Trade payables |
|
|
46 |
|
1,047 |
|
Other payables |
|
|
362 |
|
796 |
|
Total current liabilities |
|
|
408 |
|
2,570 |
|
Non-current liabilities |
|
|
|
|
|
|
Long-term loan from related party |
|
|
- |
|
829 |
|
Total non-current liabilities |
|
|
- |
|
829 |
|
Total equity and liabilities |
|
|
172 |
|
7,517 |
|
|
|
|
|
|
|
The accompanying notes are an integral part of the condensed consolidated financial statements.
SIVOTA PLC
CONDENSED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
U.S. dollars in thousands
|
|
Ordinary Share capital |
Deferred Shares |
Share Premium |
Capital reserve from transactions with non-controlling interests |
Accumulated losses |
Total equity attributable to the owners |
Non-controlling interests |
Total equity |
|
|
Unaudited |
|||||||
|
For the six months ended 30 June 2024: |
|
|
|
|
|
|||
|
|
|
|
|
|
|
|||
|
Balance as at 1 January 2024 |
157 |
65 |
15,139 |
(426) |
(12,020) |
2,915 |
1,203 |
4,118 |
|
|
|
|
|
|
|
|
|
|
|
Net loss |
- |
- |
- |
- |
(3,577) |
(3,577) |
(2,832) |
(6,409) |
|
Net comprehensive loss |
- |
- |
- |
|
(3,577) |
(3,577) |
(2,832) |
(6,409) |
|
|
|
|
|
|
|
|
|
|
|
Transactions with owners: |
|
|
|
|
|
|
|
|
|
Disposal of subsidiary - see Note 4 |
- |
- |
- |
426 |
- |
426 |
1,629 |
2,055 |
|
Total transactions with the owners |
- |
- |
- |
426 |
- |
426 |
1,629 |
2,055 |
|
|
|
|
|
|
|
|
|
|
|
Balance as at 30 June 2024 |
157 |
65 |
15,139 |
- |
(15,597) |
(236) |
- |
(236) |
The accompanying notes are an integral part of the condensed consolidated financial statements.
SIVOTA PLC
CONDENSED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
U.S. dollars in thousands
|
|
Ordinary Share capital |
Deferred Shares |
Share Premium |
Capital reserve from transactions with non-controlling interests |
Accumulated losses |
Total equity attributable to the owners |
Non-controlling interests |
Total equity |
|
|
Unaudited |
|||||||
|
For the six months ended 30 June 2023: |
|
|
|
|
|
|||
|
|
|
|
|
|
|
|||
|
Balance as at 1 January 2023 |
157 |
65 |
15,139 |
(413) |
(3,697) |
11,251 |
5,141 |
16,392 |
|
|
|
|
|
|
|
|
|
|
|
Net loss |
- |
- |
- |
- |
(1,796) |
(1,796) |
(1,423) |
(3,219) |
|
Net comprehensive loss |
- |
- |
- |
|
(1,796) |
(1,796) |
(1,423) |
(3,219) |
|
|
|
|
|
|
|
|
|
|
|
Transactions with owners: |
|
|
|
|
|
|
|
|
|
Transactions with non-controlling interests |
- |
- |
- |
- |
- |
- |
3 |
3 |
|
Share-based compensation by subsidiary |
- |
- |
- |
- |
- |
- |
197 |
197 |
|
Total transactions with the owners |
- |
- |
- |
- |
- |
- |
200 |
200 |
|
|
|
|
|
|
|
|
|
|
|
Balance as at 30 June 2023 |
157 |
65 |
15,139 |
(413) |
(5,493) |
9,455 |
3,918 |
13,373 |
The accompanying notes are an integral part of the condensed consolidated financial statements.
SIVOTA PLC
CONDENSED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
U.S. dollars in thousands
The accompanying notes are an integral part of the condensed consolidated financial statements.
SIVOTA PLC
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW
U.S. dollars in thousands
|
|
Six months ended 30 June |
For year ended 31 December |
|
|
|
2024 |
2023 |
2023 |
|
|
Unaudited |
Audited |
|
|
Cash flows from operating activities |
|
|
|
|
Net loss |
(6,409) |
(3,219) |
(12,324) |
|
Adjustments for: |
|
|
|
|
Depreciation and amortisation |
- |
819 |
1,646 |
|
Loss on impairment subsidiary's net assets - see Note 4 |
5,211 |
- |
7,123 |
|
Share-based compensation by subsidiary |
- |
197 |
44 |
|
Financial expenses, net |
98 |
127 |
241 |
|
Working capital adjustments: |
|
|
|
|
Decrease in trade receivables |
457 |
1,245 |
1,383 |
|
Decrease in other receivables |
4 |
178 |
150 |
|
Decrease in trade and other payables |
(7) |
(1,300) |
(1,648) |
|
Decrease in long term employee benefits |
- |
(12) |
(12) |
|
Net from operating activities |
(646) |
(1,965) |
(3,397) |
|
Cash flows from investing activities |
|
|
|
|
Net cash of subsidiary that ceased to be consolidated |
(178) |
- |
- |
|
Proceeds from sale of equipment |
- |
6 |
- |
|
Net cash from (for) investing activities |
(178) |
6 |
- |
|
|
|
|
|
|
Cash flows from financing activities |
|
|
|
|
Exercise of subsidiary's options |
- |
3 |
6 |
|
Net cash from financing activities |
-
|
3
|
6 |
|
|
|
|
|
|
Net change in cash and cash equivalents |
(824) |
(1,956) |
(3,391) |
|
Effect of foreign exchange rate changes |
(3) |
(66) |
(79) |
|
Cash and cash equivalents at beginning of period |
969 |
4,439 |
4,439 |
|
Cash and cash equivalents at end of period |
142 |
2,417 |
969 |
|
|
|
|
|
The accompanying notes are an integral part of the condensed consolidated financial statements.
SIVOTA PLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
U.S. dollars in thousands
1. General information
The Company is a public limited company incorporated and registered in England and Wales on 22 September 2020, with registered company number 12897590. Its registered office is The Scalpel, 18th Floor, 52 Lime Street, London, EC3M 7AF.
In July 2021, the Company completed a placing and listed on the Main Market (Standard Segment) of the London Stock Exchange ("LSE").
In December 2021, the Company announced that it had entered into a non-binding term sheet with Apester. As a result, the Company's shares were suspended pending the completion of the transaction and the publication of the prospectus regarding its enlarged group. On 12 May 2022, the Company completed the acquisition, published the prospectus in September 2022, and completed its readmission to the LSE.
The cash consideration for the Acquisition was funded through a $14.2 million (gross) placing and direct subscription of 11,500,000 new ordinary shares of Sivota of one pence each.
In July 2024 the Company announced Apester's filing decision, as detailed in Note 4.
2. Definitions
In these financial statements:
|
The Company |
- |
Sivota PLC |
|
The Group |
- |
The Company and its consolidated subsidiaries |
|
Subsidiaries |
- |
Entities that are controlled (as defined in IFRS 10) by the Company and whose accounts are consolidated with those of the Company. |
|
Dollar/USD |
- |
U.S. dollar/"$"
|
3. Significant accounting policies
The following accounting policies have been applied consistently in the financial statements for all periods presented unless otherwise stated.
a. Basis of accounting
The Group Financial Statements have been prepared in accordance with International Accounting Standards in conformity with the requirements of the UK Companies Act 2006.
The interim condensed consolidated financial statements for the six months ended 30 June 2024 have been prepared in accordance with IAS 34, Interim Financial Reporting. The interim condensed consolidated financial statements do not include all the information and disclosures required in the annual financial statements and should be read in conjunction with the Company's financial statements as at 31 December 2023.
SIVOTA PLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
U.S. dollars in thousands
Going concern
The Company projects that it will need to raise further debt or equity finance to fund the planned business development. During 2024, the company is expected to generate further losses from operations, which will be expressed in negative cash flows from operating activity. Hence, the continuation of the Company's operations depends on raising the required financing resources or reaching profitability, which are not guaranteed at this point.
While the directors believe they will be able to raise the additional finance required, this is not guaranteed and hence, there is a material uncertainty with respect of going concern.
As of the signing of this report, the company is a cash shell, and therefore there are no material effects of assuming a going-concern basis of accounting in preparing the financial statements.
b. Standards and interpretations issued but not yet applied
There were no new standards or interpretations effective for the first time for periods beginning on or after 1 January 2024 that had a significant effect on the Company's Financial Statements.
At the date of authorisation of these Financial Statements, a number of amendments to existing standards and interpretations, which have not been applied in these Financial Statements, were in issue but not yet effective for the year presented. The Directors do not expect that the adoption of these standards will have a material impact on the financial information of the Company in future periods.
4. Discontinued operation.
In June 2024, Sivota was informed by the board of Apester, its majority-owned subsidiary in Israel, that due to a deterioration in trading performance, it can no longer proceed as a going concern, and following legal advice, Apester has taken the decision to file for bankruptcy (the "filing decision"). Following the filing decision, Apester filed for bankruptcy in the court of Tel Aviv. At this point, Sivota cannot assess what recovery it will make in respect of its investment in Apester, but that recovery is not expected to be material.
Following the filing decision, the Company stopped Apester's consolidation at the end of June and wrote off its investment in Apester to zero. As a result, the Company recorded Apester's loss in H1 2024 as a loss from discontinued operation along with a loss on the impairment of Apester's net assets:
SIVOTA PLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
U.S. dollars in thousands
|
|
|
Six months ended 30 June |
For the year ended 31 December |
||
|
|
|
2024 |
2023 |
2023 |
|
|
|
|
Unaudited |
Audited |
||
|
Revenues |
|
1,557 |
3,129 |
5,622 |
|
|
Expenses |
|
2,387 |
6,020 |
10,074 |
|
|
Loss before taxes |
|
(830) |
(2,891) |
(4,452) |
|
|
|
|
|
|
|
|
|
Taxes on income |
|
- |
- |
(3) |
|
|
Net loss after taxes |
|
(830) |
(2,891) |
(4,455) |
|
|
Net assets impairment loss |
|
(5,211) |
- |
(7,123) |
|
|
Loss from discontinued operation |
|
(6,041) |
(2,891) |
(11,578) |
|
|
|
|
|
|
|
|
|
Cash flow used in discontinued operation: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash flow used in operating activities |
|
(276) |
(1,613) |
(2,821) |
|
|
Net cash flow from investing activities |
|
- |
6 |
- |
|
|
Net cash flow from financing activities |
|
- |
3 |
6 |
|
|
Net decrease in cash |
|
(276) |
(1,604) |
(2,815) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from discontinued operation:
5. Loss per share
The calculation of the basic and diluted loss per share is based on the following data:
Loss per share for loss from continuing operations:
|
|
Six months ended 30 June |
The year ended 31 December |
|
|
|
2024 |
2023 |
2023 |
|
|
Unaudited |
Unaudited |
Audited |
|
Loss for the period attributable to the equity holders of the Company |
(368) |
(328) |
(746) |
|
|
|
|
|
|
Weighted average number of ordinary shares for the purpose of basic and diluted earnings per share |
12,585,000 |
12,585,000 |
12,585,000 |
|
|
|
|
|
|
Basic and diluted loss per share - U.S. dollars |
(0.03) |
(0.03) |
(0.06) |
SIVOTA PLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
U.S. dollars in thousands
Loss per share for total loss:
|
|
Six months ended 30 June |
The year ended 31 December |
|
|
|
2024 |
2023 |
2023 |
|
|
Unaudited |
Unaudited |
Audited |
|
Loss for the period attributable to the equity holders of the Company |
(3,577) |
(1,796) |
(8,323) |
|
|
|
|
|
|
Weighted average number of ordinary shares for the purpose of basic and diluted earnings per share |
12,585,000 |
12,585,000 |
12,585,000 |
|
|
|
|
|
|
Basic and diluted loss per share - U.S. dollars |
(0.28) |
(0.14) |
(0.66) |
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