CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

			Unaudited Six months to 31 December     2023		Unaudited Six months to 31 December     2022
	Note		£		£
Cash flow from operating activities
Loss before taxation from continuing activities			(2,792)		(1,184)
Adjustments for non-cash/non-operating items:
Depreciation of property, plant and equipment			19		12
Amortisation of intangible assets			8		4
Amortisation of right-of-use assets	10		95		60
(Gain)/loss on disposal of right-of-use assets	10		(9)		1
Shares issued in lieu of cash settlement			174		-
Share-based payment expense	14		81		-
Movement in provisions			18		-
Finance income	5		(18)		-
Finance expense	6		151		85
			(2,273)		(1,022)
Increase in inventories			(670)		(606)
Increase in trade and other receivables			(889)		(432)
(Decrease)/increase in trade and other payables			(78)		712
Cash used in operations			(3,910)		(1,348)
R&D tax credits received			287		250
Net cash used in operating activities			(3,623)		(1,098)
Cash flow from investing activities
Purchase of property, plant and equipment			(67)		(17)
Purchase of intangible assets			(50)		-
Interest received			18		-
Net cash used in investing activities			(99)		(17)
Cash flow from financing activities
Principal paid on lease liabilities	10		(94)		(88)
Interest paid on lease liabilities	10		(17)		(28)
Rental income from sublease	10		11		-
Issue of shares			4,433		-
Issue of shares in Tribe Technology Group Ltd			-		1,336
Share issue costs			(369)		-
Repayment of borrowings			(558)		-
Proceeds from borrowings, net of costs			2,880		506
Other interest paid			(134)		(57)
Net cash generated from financing activities			6,152		1,669
Net increase in cash and cash equivalents			2,430		554
Cash and cash equivalents at the beginning of the period			879		232
Effect of foreign exchange rates			(50)		60
Cash and cash equivalents at the end of the period			3,259		846

 

 

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

1.    Company information

 

Tribe Technology Plc (the "Company") is a public limited company, limited by shares (not guarantee) and is incorporated and domiciled in Northern Ireland. The address of the registered office is 7b Enterprise Way, Mallusk, Belfast, BT36 4EW. The registered number of the Company is NI695862. The consolidated interim financial statements consolidate those of the Company and its subsidiaries.

 

2.    Summary of significant accounting policies

 

Basis of preparation

 

These condensed consolidated interim financial statements include the results of the Company and its subsidiaries ("the Group") for the six months ended 31 December 2023 and have not been audited. The comparative periods presented have also not been audited due to these periods including the consolidated financial statements of the Company and its subsidiaries as a result of the share-for-share exchange, as detailed below. These condensed consolidated interim financial statements do not comprise statutory accounts within the meaning of section 434 of the Companies Act 2006.

 

These condensed consolidated interim financial statements have been prepared in accordance with AIM rules and the recognition and measurement requirements of UK-adopted International Accounting Standards ("IFRS"). The condensed consolidated interim financial statements have been prepared in accordance with the accounting policies that will be applied in the Group's annual financial statements for the period ending 30 June 2024.

 

The condensed consolidated interim financial statements are presented in thousands of Pounds Sterling ("£'000"), which is the functional and presentational currency of the Group.

 

On 20 June 2023, the Company entered into a share-for-share agreement pursuant to which the Company acquired 100% of the share capital of Tribe Technology Group Limited in exchange for shares in the Company. This transaction was considered a combination of entities under common control and falls out of the scope of IFRS 3 'Business Combinations'. IFRS does not specifically state how combinations of entities under common control are accounted for. Therefore, in accordance with IAS 8 'Accounting Policies, Changes in Accounting Estimates and Errors', the Directors have considered merger accounting principles, as set out in FRS 102, The Financial Reporting Standard applicable in the UK and Republic of Ireland. Under this method, the financial statements of the parties to the combination are aggregated and presented as though the combining entities had always been part of the same group, therefore the consolidated interim financial statements include the assets and liabilities of the Group as at 31 December 2023 and in the comparative period to 30 June 2023. The opening consolidated statement of changes in equity as at 1 July 2022 includes the share capital of the Company and the reserves of the combined Group. The investment by the Company in Tribe Technology Group Limited is eliminated and the difference between the fair value and nominal value of the shares was adjusted through the merger reserve in the Group statement of financial position, along with any existing share premium in Tribe Technology Group Limited.

 

Basis of consolidation

 

The consolidated interim financial statements consolidate the interim financial statements and the results of the Company and its subsidiary undertakings Tribe Technology Group Limited and Tribe Technology Group Pty Ltd, made up to 31 December 2023.

 

Subsidiaries are entities over which the Group has control. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date that control ceases. Income, expenditure, unrealised gains and intra-Group balances arising from transactions within the Group are eliminated.

 

 

Going concern

The Group and Company do not yet generate significant revenue however, the Group does have signed contracts in place with customers guaranteeing a quantity of drill rig sales over the next five years which will generate trading revenues once the rigs have been delivered to external customers. To secure its working capital position the Group undertook an IPO on 5 September 2023, the proceeds from which will be applied towards the production of its automated drill rigs. Subsequent to the IPO the Group also secured an additional term debt facility of £3.0 million to further extend its working capital. This facility has covenants which periodically test Cash Balance, EBITDA, and Revenue of the Company. The Directors have prepared trading and cash flow forecasts for at least 12 months from the date of approval of these financial statements. After reviewing these forecasts and projections, the Directors continue to adopt the going concern basis of accounting in the preparation of the financial statements. The Directors note that as the Group's products are in the development stage and have not yet completed customer acceptance testing there remains a customer acceptance risk, or should negative market conditions occur or projected sales fail to materialise, or are delayed, there is a risk of the Group breaching the term debt facility covenants which would lead to an event of default or the Group needing to repay its debt facilities in full.

 

The interim financial statements have been prepared on a going concern basis and do not include the adjustments that would be required should the going concern basis of preparation no longer be appropriate.

3.    Other operating income

	Unaudited Period ended 31 December 2023		Unaudited Period ended 31 December 2022
	£'000		£'000
Grants received	92		124
Other income	12		28
	104		152

 

4.    Expenses by nature

 

Operating loss is stated after charging/(crediting):

 

	Unaudited Period ended 31 December 2023		Unaudited Period ended 31 December 2022
	£'000		£'000
Depreciation of property, plant and equipment	19		12
Amortisation of intangible assets	8		2
Amortisation of right-of-use assets	94		61
(Gain)/loss on disposal of right-of-use assets	(9)		2
Defined contribution pension plan	84		38

 

5.    Finance income

 

	Unaudited Period ended 31 December 2023		Unaudited Period ended 31 December 2022
	£'000		£'000
Interest received on finance leases	2		-
Bank interest	16		-
Total finance income	18		-

 

6.    Finance expense

 

	Unaudited Period ended 31 December 2023		Unaudited Period ended 31 December 2022
	£'000		£'000
Interest on bank loans & overdrafts	134		57
Interest on lease liabilities	17		28
Total finance expense	151		85

 

7.    Segmental reporting

 

The Chief Operating Decision Maker ("CODM") has been identified as the Directors. The CODM reviews the Group's internal reporting in order to assess performance and allocate resources. The CODM has determined that there is one single operating segment, the provision of drill rigs. Whilst the Group has two separate revenue streams, in the UK and Australia, management considers its principal activity is one single operating segment, with all revenue streams and divisions of the Group having similar economic characteristics.

 

8.    Taxation

 

	Unaudited Period ended 31 December 2023		Unaudited Period ended 31 December 2022
	£'000		£'000
Analysis of credit in the period
Current tax loss for the period	-		-
R&D tax credits	212		250
Total current tax	212		250
Deferred tax
Origination and reversal of timing differences	-		-
Total deferred tax	-		-
Tax credit per statement of comprehensive income	212		250

 

9.    Loss per share

 

Basic and diluted loss per share

The calculation of basic and diluted loss per share is based on the loss attributable to equity holders divided by the weighted average number of shares in issue during the period.

 

The loss incurred by the Group means that the effect of any outstanding warrants and options would be considered anti-dilutive and is ignored for the purposes of the loss per share calculation.

 

The weighted average number of ordinary shares has been adjusted in both periods presented for the effect of the 600:1 share subdivision that took place in the period to 31 December 2023.

 

	Unaudited		Unaudited
	Period ended 31 December 2023 £'000		Period ended 31 December 2022 £'000
Loss for the period from continuing activities	(2,626)		(869)
	Period ended 31 December 2023 No.		Period ended 31 December 2022 No.
Weighted average number of ordinary shares	167,618,514		121,589,400
	Period ended 31 December 2023		Period ended 31 December 2022
Basic and diluted loss per share (£)	(0.02)		(0.01)

 

10.  Leases

 

The Group as a lessee

 

The Group leases a number of assets in the jurisdictions from which it operates in with all lease payments, in-substance, fixed over the lease term. All expected future cash out flows are reflected within the measurement of the lease liabilities at each period end.

 

Right-of-use assets

 

Cost	Leasehold property £'000		Software assets £'000		Equipment £'000		Motor vehicles   £'000		Total   £'000
At 1 July 2022	617		23		174		96		910
Additions	10		-		18		-		28
Disposals	-		-		(36)		(32)		(68)
FX	29		(2)		(1)		(1)		25
At 30 June 2023	656		21		155		63		895
Amortisation
At 1 July 2022	154		4		24		8		190
Charge for the period	129		5		32		9		175
Disposals	-		-		(3)		(3)		(6)
FX	13		-		-		-		13
At 30 June 2023	296		9		53		14		372
Net book amount
At 30 June 2023	360		12		102		49		523

 

Cost	Leasehold property £'000		Software assets £'000		Equipment £'000		Motor vehicles   £'000		Total   £'000
At 1 July 2023	656		21		155		63		895
Additions	-		-		11		-		11
Disposals	(125)		-		-		-		(125)
FX	(31)		-		-		-		(31)
At 31 December 2023	500		21		166		63		750
Amortisation
At 1 July 2023	296		9		53		14		372
Charge for the period	54		4		29		8		95
Disposals	(69)		-		-		-		(69)
FX	(17)		-		-		-		(17)
At 31 December 2023	264		13		82		22		381
Net book amount
At 31 December 2023	236		8		84		41		369

 

Lease liabilities

 

	Leasehold property £'000		Software assets £'000		Equipment £'000		Motor vehicles   £'000		Total   £'000
At 1 July 2022	488		19		118		77		702
Additions	-		-		15		-		15
Remeasurement	(22)		-		-		-		(22)
Interest expense	33		2		10		7		52
FX	17		(2)		-		(2)		13
Lease payments (including interest)	(152)		(11)		(55)		(14)		(232)
Disposals	-		-		(29)		(26)		(55)
At 30 June 2023	364		8		59		42		473
At 1 July 2023	364		8		59		42		473
Additions	-		-		11		-		11
Interest expense	11		1		3		2		17
FX	(16)		-		-		-		(16)
Lease payments (including interest)	(75)		(5)		(26)		(5)		(111)
At 31 December 2023	284		4		47		39		374

 

Reconciliation of minimum lease payments and present value

 

	31 December     2023		30 June  2023
	£'000		£'000
Within 1 year	118		224
Later than 1 year and less than 5 years	291		300
After 5 years	-		-
Total including interest cash flows	409		524
Less: interest cash flows	(35)		(51)
Total principal cash flows	374		473

 

Classification of current and non-current lease liabilities

 

	31 December     2023		30 June  2023
	£'000		£'000
Current	177		209
Non-current	197		264
Total	374		473

 

The Group as a lessor

 

The Group sublets a leased property which is accounted for as a finance lease.

 

Lease receivable

 

	Leasehold property £'000
At 1 July 2023	-
Additions	65
Interest income	2
Lease payments received	(13)
FX	2
At 31 December 2023	56

 

Reconciliation of minimum lease payments receivable and present value

 

	31 December     2023		30 June  2023
	£'000		£'000
Within 1 year	32		-
Later than 1 year and less than 5 years	29		-
After 5 years	-		-
Total including interest cash flows	61		-
Less: interest cash flows	(5)		-
Total principal cash flows	56		-

 

11.  Trade and other payables

 

	31 December     2023		30 June  2023
	£'000		£'000
Amounts falling due within one year:
Trade payables	486		698
Social security and other taxes	74		149
Contract liabilities	1,075		800
Other payables	208		274
	1,843		1,921
Amounts falling due after one year:
Contract liabilities	1,054		1,054
Other provisions	647		629
Deferred tax	54		54
	1,755		1,737

 

A provision has been made for an amount of £647k (30 June 2023: £629k) by the Group resulting from an onerous contract. This amount will be released over the remainder of the contract in line with the accounting policy.

 

Contract liabilities includes deferred income relating to advance contract payments.

 

12.  Borrowings

 

	31 December     2023		30 June  2023
	£'000		£'000
Current:
Bank loans	112		220
Non-current:
Bank loans	2,789		359
Total borrowings	2,901		579

 

Bank loans include a facility entered into in the period of which £3m was drawn down prior to the period end, bearing interest of 13% per annum and repayable over 5 years, with payments of interest only for the first twelve months. Transaction costs of £120k have been included. Amounts related to this loan due less than one year total £96k with the remainder being repaid post year end. A bank loan with a total principal amount of £500k, partly drawn down in 2022 (£250k) and in 2023 (£250k), was repaid in full in the period. The bank loans are secured by fixed and floating charges over the Company's assets.

 

	31 December     2023		30 June  2023
	£'000		£'000
Opening balance	579		1,180
Proceeds from bank loans	2,880		740
Interest expense	134		106
Repayment of bank loans (including interest)	(692)		(1,447)
Closing balance	2,901		579

 

13.  Share capital  

 

Allotted, called up and fully paid	31 December 2023 Number		30 June 2023 Number
Ordinary shares of £0.0005 each	221,947,771		116,587,800
A Ordinary shares of £0.0005 each	-		5,000,400
Deferred shares of £0.0001 each	-		7,334
Total share capital	221,947,771		121,595,534

 

The number of Ordinary and A Ordinary shares at 30 June 2023 have been adjusted to reflect the 600:1 share subdivision that took place in the period to 31 December 2023.

 

During the period ended 31 December 2023, the A Ordinary shares were converted into Ordinary shares.

 

Deferred shares entitle shareholders to £0.01 in aggregate upon winding up the Company but carry no voting rights. During the period ended 31 December 2023, the deferred shares were cancelled.

 

Movement in ordinary shares	Number of shares		Number of shares		Share capital		Share premium
	£0.30 ordinary shares		£0.0005 ordinary shares		£		£
At 01 July 2022	2		-		1		-
Issue of shares	202,647		-		60,794		-
Cancellation of shares	(2)		-		(1)		-
At 30 June 2023	202,647		-		60,794		-
Effect of 600:1 share subdivision	(202,647)		121,588,200		-		-
Bonus issue of shares	-		28,411,801		14,206		-
Issue of shares - cash	-		71,947,770		35,974		6,638,429
	-		221,947,771		110,974		6,638,429
Cost of share issue	-		-		-		(369,314)
At 31 December 2023	-		221,947,771		110,974		6,269,115

 

13.  Reserves

 

Share capital

Share capital represents the nominal value of shares that have been issued.

 

Share premium

Share premium represents any premiums received on issue of share capital. Any transaction costs associated with the issue of shares are deducted from share premium.

 

Shares to be issued

Shares to be issued represents cash received in advance of 26,018,710 shares being issued in relation to advanced subscription agreements which are considered equity, as the holders have no option to convert these back to cash. They were settled on IPO of the Company at £0.08 per ordinary share.

 

Merger reserve

On 20 June 2023, Tribe Technology Plc acquired the 202,647 ordinary shares (100% of the share capital) in Tribe Technology Group Limited, in return for the issue of 202,647 ordinary shares with a nominal value of £0.3 each (refer note 2).  This transaction falls under section 612 of the Companies Act and merger relief was applied.

 

On consolidation, the Company's investment in Tribe Technology Group Limited is eliminated and the difference between the fair value of the consideration and the share capital and share premium of Tribe Technology Group Limited is recognised in the merger reserve, resulting in a merger reserve of £3,183,000.

 

Share-based payments reserve

Cumulative fair value of options charged to the consolidated income statement net of transfers to the profit or loss reserve on exercised and cancelled/lapsed options.

 

Foreign exchange reserve

Exchange reserve represents the differences arising on translation of foreign assets and liabilities.

 

Accumulated losses

Accumulated losses relate to cumulative net gains and losses less distributions made.

 

14.  Share-based payments

 

Share options

 

Tribe Technology Group Limited operated an equity-settled share-based remuneration scheme for employees. These options were to lapse if the individual leaves within 10 years from the date of grant if all vesting conditions had not been met earlier. These options were superseded, and all options were transferred into new options held by Tribe Technology Plc as part of the share-for-share transaction that took place on 20 June 2023. The exercisable options held were transferred to equivalent options.

 

The terms and conditions of the grants outstanding as at 31 December 2023 are detailed below:

 

Date of grant	No. of options	Exercise price £	Vesting conditions	Contractual life of options
30 June 2023	3,206,560	0.0005	See below*	10 years

 

*The options vest on the earlier of 2 years from the date of grant, or an exit event, such as a sale or takeover.

 

The number of options and exercise price above have been adjusted for the effect of a 600:1 share subdivision.

 

The fair value of options granted and outstanding were measured using the Black-Scholes model, with the following inputs:

	2023
Fair value at grant date	£0.101
Share price	£0.101
Exercise price	£0.005
Expected volatility	56.5%
Option life	2 years
Risk free interest rate	4.97%

 

Details of the number of share options granted, exercised, lapsed and outstanding at the end of each period as well as the weighted average exercise prices in £ ("WAEP") are as follows:

 

	31 December 2023		WAEP		30 June 2023		WAEP
Outstanding at beginning of period	3,206,560		0.0005		-		-
Granted during the period	-		-		3,206,560		0.0005
Outstanding at year end	3,206,560		0.0005		3,206,560		0.0005

 

The number of share options and WAEP have been adjusted in all periods presented for the effect of a 600:1 share subdivision which occurred during the period.

 

As at 31 December 2023, the remaining contractual life for the options outstanding is 9.47 years (30 June 2023: 9.98 years).

 

During the period, a share-based payment expense of £81k (31 December 2022: £Nil) has been recognised in the statement of comprehensive income.

 

15.  Share-based payments (continued)

 

Warrants

 

The Company grants warrants at its discretion to certain investors.

 

On 20 June 2023, as part of the share-for-share exchange, warrant holders agreed to cancel the warrants in Tribe Technology Group Limited in consideration of the issue by the Company of new warrants to subscribe for shares in the Company.

 

The warrants granted in the period ended 31 December 2023 have an exercise price of £0.07914 and may be exercised at any time until 1 June 2026.

 

Details of the number of warrants granted, exercised, lapsed and outstanding at the end of each period as well as the WAEP in £ are as follows:

 

	31 December 2023		WAEP		30 June 2023		WAEP
Outstanding at beginning of period	4,478,229		0.07914		-		-
Granted during the period	-		-		4,478,229		0.07914
Outstanding at year end	4,478,229		0.07914		4,478,229		0.07914

 

The number of warrants and WAEP have been adjusted in all periods presented for the effect of a 600:1 share subdivision which occurred during the period.

 

The remaining contractual life for the warrants outstanding is 2.42 years (30 June 2023: 2.92 years).

 

16.  Events after the reporting period

There have been no significant events since the end of the reporting period.