Primorus Investments plc

Financial statements

For the year ended 31 December 2021

Registered number: 03740688

Primorus Investments plc

Company Information

Directors

Matthew Paul Beardmore

Hedley Stuart Clark

Rupert Labrum

Company secretary

Simon William Holden

Registered number

03740688

Registered office

48 Chancery Lane

C/O Keystone Law (Attn: S Holden)

London

WC2A 1JF

Independent auditor

PKF Littlejohn LLP

Statutory Auditor

15 Westferry Circus

Canary Wharf

London

E14 4HD

Bankers

Barclays Bank plc

One Churchill Place

London

E14 5HP

Solicitors

Keystone Law Limited

48 Chancery Lane

London

WC2A 1JF

Registrars

Share Registrars Limited

The Courtyard

17 West Street

Farnham

GU9 7DR

Nominated Adviser & Broker

Cairn Financial Advisers LLP

9th Floor

107 Cheapside

London

EC2V 6DN

Page 1

Primorus Investments plc

Contents

Page

Chairman's report incorporating the strategic report

3 - 6

Directors' report

7 - 10

Governance report

11-15

Independent auditors' report

16 - 20

Statement of Profit or Loss and Other Comprehensive Income

21

Statement of financial position

22

Statement of changes in equity

23

Statement of cash flows

24

Notes to the financial statements

25 - 45

Page 2

Primorus Investments plc

Chairman's Report incorporating the Strategic Report

For the year ended 31 December 2021

Overview

I am pleased to present the Chairman's Statement and Strategic Report for the financial results of Primorus Investments plc ("Primorus" or the "Company") for the year ended 31 December 2021.

Introduction

The period under review was one again of significant change. The COVID-19 pandemic continued to have an impact with macroeconomic changes and inflation coming to the forefront. During the period, COP26 was especially important, with countries signing up to various net zero charters which was both much needed and should also present many opportunities for Primorus to make investments in this sector.

It has again been pleasing to see the progress made by several of our investee companies, in the face of some exceptional challenges brought on by the COVID-19 pandemic. Some of the investee companies have continued to struggle in the economic environment and will need to raise capital.

Concurrent with reviewing the Company's existing investments, the management team was also presented with many new opportunities during the period. The management team carefully reviewed each opportunity and decided that it was in the best interests of the Company and its shareholders as a whole to put in place a new, more robust strategy, that underpins all future investments. This includes a focus on quoted investments as well as those where there is the expectation of a liquidity event in the short to medium term. Post-financial period, the Company has made investments in three publicly quoted issuers.

Primorus completed a capital reduction, as announced by the Company on 7 October 2021. The result of the capital reduction changed the retained deficit that was then on the Company's balance sheet of £41 million into a surplus of £8.6 million. Together with strengthening the Company's balance sheet, this will allow the Company to complete share buybacks or pay dividends if the Board feels such actions are in the best interests of the Company and its shareholders as a whole.

An additional post-financial period event to highlight is the cancellation of certain share options which had previously been granted to members of the Company's management team. I strongly believe that remuneration should be based on success and that a more appropriate incentive will be included on a non-dilutive basis.

Investment highlights

  • Fresho Pty Ltd ("Fresho") successfully raised AUD$12m of new equity capital at $0.90 per share in April 2022. In March 2021, Primorus made a further investment for 2,000,000 in new shares at a price of AUD$0.575 for a total consideration of AUD$1.15 million (approximately £637k), bringing its total shareholding in Fresho to 3,415,723 shares. Over 21,000 + businesses are now using Fresho. Fresho also expanded into the UK in 2021.
  • The Company exercised 1 million options in Zuuse Limited ("Zuuse") at a price per option (on the basis of one option being exercisable over one share in the capital of Zuuse) of AUD$0.50 in September 2021. Zuuse rebranded to "Payapps" to align it more with its strategic direction and growth opportunities.
    Both UK and US businesses have exceeded a 50 % growth rate over the second half of 2021 and have invested strongly in headcount with an increase of 85% over 2020 which is expected to generate revenue growth throughout 2022 and beyond.
  • Engage Technology Partners Limited ("Engage"), the end-to end workforce management platform provider, completed an equity fundraise, resulting in the conversion of certain loan notes held by investors, including the Company, at a 20% discount to the price per share subscribed for by investors who participated in the equity fundraise. Engage continues to build momentum through the development of Managed Service Providers and Back Office Systems ("BOS") as products essential for growth.
  • In April 2021, the Company invested US$2.5m into convertible loan notes ("CLNs") issued by Mustang Energy PLC ("Mustang"), a special purpose acquisition company listed on the Standard segment of the London Stock Exchange Main

Page 3

Primorus Investments plc

Chairman's Report incorporating the Strategic Report (continued)

For the year ended 31 December 2021

Market. Due to Mustang not being in a position to complete its reverse takeover and readmission by the applicable maturity date, Primorus exercised its right to acquire shares in AIM-quoted Bushveld Minerals Ltd (see post period end comments), which were provided as a backstop mechanism under the CLNs.

  • In October 2021, the Company invested £350k in Alteration Earth PLC, a special purpose acquisition company established to make acquisitions in the clean technology and renewable energy sectors. The Board believes there will be many opportunities within these sectors.
  • SOA Energy ("SOA") successfully completed the re-entry of the Ofek-2ST well without the need for a side track. The well moved directly for testing operations.
  • SOA is working on acquiring new off-shore assets and creating a new partnership with a European oil major company after which SOA intends to seek a listing on the London Stock Exchange.

Primorus holds several legacy investments which do not form part of its long-term strategy.

The legacy investments include Nomad Energy, Sport 80, TruSpine, Weshop, Stream TV, Supernatural Foods, MEVIE and Rogue Baron.

These investments will now be classified on the website under non-core holdings.

Primorus will continue to actively manage its investments and liquidity which may involve holding certain

Market tradeable investments. Where active management involves non-material transactions, these will not be reported via an RNS, but instead the Company's website shall be updated on a regular basis to reflect any changes to the investments held by the Company. These changes may include the purchase of additional shares or the disposal in part or in whole of any individual investment.

Financial highlights

The operating loss for the year was £0.041 million (2020: profit of £4.616 million). The net profit after tax was £0.109

million (2020: profit of £4.169 million). Total assets including cash at 31 December 2021 amounted to £8.990 million

(2020: £9.401 million).

The cash balance was £0.941 million as at 31 December 2021.

Board Changes

I was pleased to announce in June 2021 that Matthew Beardmore accepted the role of Chief Executive Officer of the Company. Matthew has and I am sure will continue to make an outstanding contribution to the success of the Company. I am very grateful for Matthew's efforts as I am to all my fellow Directors for their effort and enthusiasm.

Investee companies

The majority of the Company's investments in underlying investee companies are minority investments. Whilst we may offer advice to management of the investee companies, specifically pertaining to their business objectives and goals, they can and sometimes do ignore such advice. Similarly, those investee companies which are privately held do not have similar disclosure obligations to publicly quoted companies and therefore any updates they provide in relation to their businesses can be piecemeal and, in certain cases, non-existent save where the Board specifically requests an update. Primorus has no operational capacity insofar as it pertains to any of its investee companies, and whilst the Board will in future look to structure investments in a format where Primorus can have a high degree of oversight, other than with Alteration Earth PLC, this has not been done with the Company's investments to date, and, as such, there are inherent risks in that investee companies are not as accountable to the Company as the Board would prefer them to be.

In relation to its investment in Alteration Earth PLC, the Company has nominated a director onto the board to ensure there is oversight on behalf of Primorus. This is a significant step for the Company because it is the first investment where the Company will get an insight into the operation of the investee company and be able to actively voice its opinions, concerns and constructive advice instead of being informed of decisions after the event.

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Disclaimer

Primorus Investments plc published this content on 10 June 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 10 June 2022 14:12:04 UTC.