Hawkwing : 2021 Annual Report

HAWKWING PLC

Annual Report and Financial Statements For The Year Ended 31 December 2020

HAWKWING PLC Annual Report 31 December 2020

Contents

1

HAWKWING PLC Annual Report 31 December 2020

STRATEGIC REPORT

2020 Full Year Results

The Company's headline results are set out as follows:

1. Headline EBITDA is operating loss adjusted to remove the impact of exceptional income/costs
2. 2019 loss per share has been adjusted to reflect the share consolidation during the year

2

HAWKWING PLC Annual Report 31 December 2020

STRATEGIC REPORT (continued)

Principal Activities And Business Review

As a cash shell, the principal activity of the business in the year has been to identify potential acquisition opportunities. During the first half of 2020 the Company reviewed its AIM listing and decided that a listing on the Standard List and trading on the London Stock Exchange's Main Market would be more appropriate as a Cash Shell and will increase the Company's ability to identify and complete and acquisition. The move to the Standard List was completed on 30 September 2020 and the Company's balance sheet was strengthened with a fund raising of £1.29 million, before costs.

The Company is a Cash Shell and its strategy is to consider opportunities with an initial focus on acquiring one or more companies in industries such as digital marketing, medical applications, business and financial services and the sports sector. These businesses will provide specialised, mission-critical technology solutions for specific industries as opposed to being applicable across different sectors. The Company's focus is on identifying and acquiring businesses with the prospects of being profitable and cash generative. Finding a suitable acquisition has been, and will continue to be, impacted by COVID- 19 restrictions. Nevertheless, the Board continues to review potential targets and will update shareholders when appropriate. Whilst an acquisition is being sought, the Board intends to keep costs to a minimum to preserve cash. The Non-Executive directors have therefore waived their fees since 1 January 2019.

PRINCIPAL RISKS AND UNCERTAINIES

The management of the Company and the execution of the Company's strategies are subject to certain risks; however the Company's current operations are such that most risks are negligible. The key business risks are shown below.

Identifying suitable acquisition opportunities

The success of the Company's business strategy is dependent on its ability to identify sufficient suitable acquisition opportunities. The Company cannot estimate how long it will take to identify suitable acquisition opportunities or whether it will be able to identify any suitable acquisition opportunities at all within one year after the date of admission. If the Company fails to complete a proposed acquisition (for example, because it has been outbid by a competitor) it may be left with substantial unrecovered transaction costs, potentially including fees, legal costs, accounting costs, due diligence or other expenses to allow it to pursue further opportunities. Furthermore, even if an agreement is reached relating to a proposed acquisition, the Company may fail to complete such acquisition for reasons beyond its control. Any such event will result in a loss to the Company of the related costs incurred, which could materially adversely affect subsequent attempts to identify and acquire another target business. In the event that an acquisition has not been announced within 12 months of Admission the Board will ask Shareholders to approve to continue pursuing an acquisition for a further 12 months.

Risk management

The risks that the Company faces have been considered and policies have been implemented to best deal with each risk. The most significant risks are set out as follows:

Credit risk

The Company has no trade receivable balances and only minor other receivables and thus there is no significant current risk of non-payment.

Liquidity risk

The Company is currently being maintained as a Cash Shell and the Board intends to complete a reverse takeover as soon as practicable. During this time the Board will keep costs to a minimum in order to preserve cash.

3

HAWKWING PLC Annual Report 31 December 2020

STRATEGIC REPORT (continued)

Currency risk

The Company's only current exposure to currency risk is with regard to amounts held in foreign currency bank accounts. The non-sterling cash balances at 31 December 2020 were US$130 (2019: US$12,064).

COVID-19

Trading conditions are likely to remain dynamic amid social and market uncertainty related to the Covid- 19 pandemic and accordingly it is not possible to quantify with any certainty the impact of the Covid-19 pandemic on the Company. The Company continues to monitor the situation however, the full impact of the Covid-19 pandemic on the Company will depend on a variety of factors including the length of time the restrictions on social movement are in place and the extent to which further measures are required. The Company is of the opinion that the operations and business model of the Company should be able to accommodate a relatively high degree of variability.

KEY PERFORMANCE INDICATORS ("KPI's")

Following the divestment of all its investments in group undertakings, the Company no longer has any operational businesses using KPIs. As a result, performance against KPIs is not presented within these financial statements.

The Company's immediate future performance criteria relate to a successful future acquisition/reverse takeover.

Environmental policy

The Company is committed to minimising the environmental impact of the activity of its employees through the application of modern working practices and to reduce business miles travelled.

Employees

The Company is an Equal Opportunities Employer and no job applicant or employee receives less favourable treatment on the grounds of age, sex, marital status, sexual orientation, race, colour, religion or belief.

It is the policy of the Company that individuals with disabilities, whether registered or not should receive full and fair consideration for all job vacancies for which they are suitable applicants. Employees who become disabled during their working life will be retained in employment whenever possible and will be given help with any rehabilitation and retraining.

Corporate and social responsibility

The Board recognises the growing awareness of social, environmental and ethical matters and it endeavours to take account of the interest of the Company's stakeholders when operating the business.

Human rights

Whilst the Company does not have a specific human rights policy, it takes seriously the responsibility to respect human rights. Fairness and integrity are an important part of the way the business is run and employees are encouraged to raise any concerns in this area to management at the earliest opportunity.

Anti-corruption and anti-bribery

The Company takes seriously the risks of its operations associated to corruption and fraud. The Company has implemented up to date internal control procedures to mitigate the risks of corruption and fraud and the Board acknowledges its responsibility for maintaining these improved processes.

4

This is an excerpt of the original content. To continue reading it, access the original document here.