AURA RENEWABLE ACQUISITIONS PLC

Earnings Release • Sep 5, 2023

National Storage Mechanism | Additional information

RNS Number : 3445L

Aura Renewable Acquisitions PLC

05 September 2023

 

Aura Renewable Acquisitions plc

("Aura" or "Company")

Interim Results for the six months ended 30 June 2023

5 September 2023 - Aura Renewable Acquisitions plc, a UK-incorporated company, whose objective is to invest in the global renewable energy sector supply chain and thereby build shareholder value, announces its interim results for the six months ended 30 June 2023.

Highlights

·    Targeting acquisitions operating in the Global Renewable Energy Sector Supply Chain.

·    An engaged board with a combination of strong sector and capital markets experience and expertise.

·    Low cost base and minimal cash burn.

·    Good visibility towards potential targets via an extensive contact base of potential introducers and opportunities.

·    Strong connections to potential sources of acquisition funding.

·    Best practice ESG policies will be introduced to support and encourage sustainability across our business.

John Croft, the Chairman of Aura, commented:

"Aura was established to acquire and then act as the holding company for targeted businesses operating in the global renewable energy sector supply chain, particularly participants in the wind, solar, biomass, hydropower, carbon capture, waste management, smart grids and green hydrogen supply chain, and their sub-sectors.

"The board has continued to investigate a number of potential acquisition and investment opportunities during the year-to-date, in the UK and overseas, which could offer the scale and scalability required to achieve significant growth in this crucially important market sector. We also continue to engage regularly with the board's extensive financial networks to maintain the Company's profile and promote its expansion strategy with the board's extensive introducer base.

"Economic and political uncertainty caused by persistent inflation, high interest rate rises and continuing hostilities in Eastern Europe have continued to depress capital market activity and new issues during 2023, although M&A is more buoyant across markets. The growing awareness of what is now seen as the clear, present and irrefutable danger of global warming on populations, habitats and landscapes underpins our business strategy and economic rationale. Fortunately, there is a growing if sometimes inconsistent shift by national governments to focus on sustainable renewable energy.

"Against a background of general uncertainty and unquestioned need, we believe our closely targeted and considered approach to our first acquisition is correct, aiming to identify a transformational target that can create a meaningful contribution in the renewable energy space. There can be no doubt that the renewable energy sector will offer exciting opportunities for acquisitive and organic growth for the foreseeable future, and we are committed to ensure that the Company and its stakeholders will share in these opportunities.

"Within our team we have both the skills and experience to capitalise on the opportunities that are expected to arise in the renewable energy sector supply chain."

Enquiries

Aura Renewable Acquisitions Plc                                                                                                                              

John Croft (Non-Executive Chairman)	07785 315588
Robin Stevens (Non-Executive Director)	07787 112059

Media enquiries

Allerton Communications
Peter Curtain	020 3633 1730
	aurarenewables@allertoncomms.co.uk

Notes to Editors

Aura was established to acquire and then act as the holding company for targeted businesses operating in the Global Renewable Energy Sector Supply Chain, particularly participants in the wind, solar, biomass, hydropower, carbon capture, waste management, smart grids and green hydrogen supply chain, and their sub-sectors. These potential targets could range from raw materials resourcing to power generation, energy storage and recycling.

The Company's website is http:www.aurarenewables.com.                       

Inside Information

The information contained within this announcement is deemed by Aura to constitute inside information as stipulated under the Market Abuse Regulation (EU) no. 596/2014. On the publication of this announcement via a Regulatory Information Service, this inside information is now considered to be in the public domain.

Chairman's statement

It is my pleasure to present the interim results for the Company covering the six months ended 30 June 2023.

Aura was established to acquire and then act as the holding company for targeted businesses operating in the global renewable energy sector supply chain, particularly participants in the wind, solar, biomass, hydropower, carbon capture, waste management, smart grids and green hydrogen supply chain, and their sub-sectors. We believe this wide scope provides the best opportunity to secure assets that will deliver maximum value. These potential targets could range from raw materials resourcing to power generation, energy storage and recycling.

The Company raised net proceeds of £1,005,000 when it joined the Standard Segment of the Main Market of the London Stock Exchange in April 2022 and, since the IPO the business continues to incur minimal overheads until we find a suitable acquisition target. This is reflected in our net loss before taxation for the six-month period of £69,598 (2022: £164,065 (loss)), and that at 30 June 2023 we had retained cash and bank resources of £723,127.

The board has continued to investigate a number of potential acquisition and investment opportunities during the year-to-date, in the UK and overseas, which could offer the scale and scalability required to achieve significant growth in this crucially important market sector. We also continue to engage regularly with the board's extensive financial networks to maintain the Company's profile and promote its expansion strategy with the board's extensive introducer base.

Economic and political uncertainty caused by persistent inflation, high interest rate rises and continuing hostilities in Eastern Europe have continued to depress capital market activity and new issues during 2023, although M&A is more buoyant across markets. The growing awareness of what is now seen as the clear, present and irrefutable danger of global warming on populations, habitats and landscapes underpins our business strategy and economic rationale. Fortunately, there is a growing if sometimes inconsistent shift by national governments to focus on sustainable renewable energy.

The US Inflation Reduction Act (IRA) continues to stimulate large-scale investment in new clean energy projects; the Canadian Government announced $35bn tax credits for environmentally beneficial investment in April, while the UK Government has repeatedly reiterated its commitment to decarbonising the economy.

Plans announced by the UK Prime Minister on 31 July, for hundreds of North Sea oil and gas licences, appear to be a balanced response aimed at replacing energy from unstable states with domestic supplies while maximising skills, despite opposition by some pressure groups. Mr Sunak also announced two new carbon capture and storage sites in the North Sea by 2030 to tackle climate change, which would take the UK's total to four.

Against a background of general uncertainty and unquestioned need, we believe our closely targeted and considered approach to our first acquisition is correct, aiming to identify a transformational target that can create a meaningful contribution in the renewable energy space. There can be no doubt that the renewable energy sector will offer exciting opportunities for acquisitive and organic growth for the foreseeable future, and we are committed to ensure that the Company and its stakeholders will share in these opportunities.

As stated previously, we are fully aware of our wider environmental, social and governance responsibilities to shareholders and other stakeholders and we are committed to follow market best practice and developing procedures to address these important issues.

I would like to thank my fellow board members and our advisers for their continuing guidance and support. I'm sure that within our team we have both the skills and experience to capitalise on the opportunities that are expected to arise in the renewable energy sector supply chain.

Principal Risks and Uncertainties

The Directors consider the principal risks and uncertainties facing the Company and a summary of the key measures taken to mitigate those risks are as follows:

Operational risks - difficulties in acquiring suitable targets

The Company's strategy is dependent to a significant extent on its ability to identify sufficient suitable acquisition opportunities and to execute these transactions at a price and on terms consistent with the Company's strategy. In particular, in order to qualify for re-admission to the Official List following an acquisition, the expected aggregate market value of the issued Ordinary Shares on such re-admission would have to be at least £30 million. However, it is possible that the board might decide to seek admission to the AIM Market at the time of its first acquisition, where no such size constraints exist, rather than re-join the Official List.

If the Company cannot identify suitable acquisitions, or successfully execute any such transactions, this will have an adverse effect on its financial and operational performance, and it will be unable to achieve its strategic objectives.

In the event of the completion of an acquisition, the Company will adopt a formal treasury policy which will be reviewed and approved by the Audit Committee on an annual basis. The treasury policy will cover all areas of treasury risk including foreign exchange, interest rate, counterparty and liquidity.

The success of the Company's business strategy is also dependent on the subsequent performance of the acquired entities.

The Directors seek to manage these risks by leveraging the experience of the skill sets of the non-executive Directors to prudently identify, pursue and execute on acquisition opportunities. The review of acquisition targets involves and assessment of the target's business and the markets it operates in, its business plans and management capabilities.

CONDENSED STATEMENT OF COMPREHENSIVE INCOME

The unaudited condensed interim statement of comprehensive income of the Company for the six months ended 30 June 2023 is stated below. The comparative period is from the date of incorporation on 4 November 2021 to 30 June 2022.

	Note	Six months ended 30 June 2023 (unaudited) £	Period ended 30 June 2022 (unaudited) £
Revenue		-	-
Administrative expenses	6	(74,850)	(164,065)
Operating loss		(74,850)	(164,065)
Finance costs		-	-
Finance income	8	5,252	-
Loss before taxation		(69,598)	(164,065)
Income tax	9	-	-
Total comprehensive loss for the period attributable to the equity holders		(69,598)	(164,065)
Basic and diluted earnings per ordinary share attributable to the equity holders (£)	10	(0.007)	(0.04)

There was no other comprehensive income in the period. All activities relate to continuing operations.

CONDENSED STATEMENT OF FINANCIAL POSITION

The unaudited condensed interim statement of financial position of the Company at 30 June 2023, is stated below:

	Note	At 30 June 2023 (unaudited) £	At 31 December 2022 (audited) £
ASSETS
Current assets
Cash and cash equivalents	11	723,127	809,472
Other receivables - prepayments		9,000	5,697
Total assets		732,127	815,169
LIABILITIES
Current liabilities
Accruals		16,486	35,400
Total liabilities		16,486	35,400
EQUITY
Equity attributable to owners
Ordinary share capital	12	150,000	150,000
Share premium		855,000	855,000
Share based payment reserve		16,488	11,018
Retained losses		(305,847)	(236,249)
Total equity attributable to Shareholders		715,641	779,769
Total equity and liabilities		732,127	815,169

CONDENSED STATEMENT OF CASH FLOWS

The unaudited condensed interim statement of cash flows of the Company for the six months ended 30 June 2023, is stated below:

	Six months ended 30 June 2023 (unaudited) £	Period ended 30 June 2022 (unaudited) £
Cash flows from operating activities
Loss before income tax	(69,598)	(164,065)
(Decrease) / increase in payables	(18,914)	4,510
Share based payment charges	5,470	-
Increase in prepayments	(3,303)	-
Net cash flow from operating activities	(86,345)	(159,555)
Cash flows from financing activities
Net proceeds from issue of ordinary shares	-	1,005,000
Net cash inflow from financing activities	-	1,005,000
Net (decrease) / increase in cash and cash equivalents	(86,345)	845,445
Cash and cash equivalents at beginning of period	809,472	-
Cash and cash equivalents at end of period	723,127	845,445

CONDENSED STATEMENT OF CHANGES IN EQUITY

The unaudited condensed interim statement of statement of changes in equity of the Company for the six months ended 30 June 2023, is stated below:

	Ordinary share capital	Share  premium	Share-based payment reserve	Retained earnings	Total equity
	£	£	£	£	£
At incorporation	-	-	-	-	-
Loss for the period	-	-	-	(164,065)	(164,065)
Comprehensive loss for the period
Total comprehensive loss for the period	-	-	-	(164,065)	(164,065)
Transactions with owners in the period
Issue of ordinary shares	150,000	900,000	-	-	1,050,000
Share issue costs	-	(45,000)	-	-	(45,000)
Total transactions with owners	150,000	855,000	-	-	1,005,000
At 30 June 2022	150,000	855,000	-	(164,065)	840,935
As at 31 December 2022	150,000	855,000	11,018	(236,249)	779,769
Loss for the period	-	-	-	(69,598)	(69,598)
Comprehensive loss for the period
Total comprehensive loss for the period	-	-	-	(69,598)	(69,598)
Transactions with owners in the period
Share-based payment charges	-	-	5,470	-	5,470
Total transactions with owners	-	-	5,470	-	5,470
At 30 June 2023	150,000	855,000	16,488	(305,847)	715,641

NOTES TO THE INTERIM FINANCIAL STATEMENTS

1          General information

The Company was incorporated on 4 November 2021 as Aura Renewable Acquisitions Plc in England and Wales with company number 13723431 under the Companies Act 2006.

The address of its registered office is Holborn Gate, 330 High Holborn, London WC1V 7QH.

The principal activity of the Company is to act as the holding company for various target businesses operating in the Global Renewable Energy Sector Supply Chain.

The entire issued ordinary share capital of 10,500,000 ordinary shares of £0.01 each was admitted to listing on the standard segment of the Official List of the Financial Conduct Authority and, to trading on the main market for listed securities of London Stock Exchange plc under the TIDM "ARA" on 8 April 2022.

2          Basis of preparation

The principal accounting policies applied in the preparation of the Company's condensed interim financial statements are set out below. These policies have been consistently applied to the period presented, unless otherwise stated.

The unaudited condensed interim financial statements have been prepared in accordance with the Disclosure and Transparency Rules of the Financial Conduct Authority and International Accounting Standard 34 "Interim Financial Reporting" (IAS 34). These condensed interim financial statements have been prepared under the historical cost convention.

These condensed interim financial statements do not include all of the information required for a complete set of IFRS financial statements. However, selected explanatory notes are included to explain events and transactions that are significant to an understanding of the changes in the Company's financial position and performance during the six-month period ended 30 June 2023.

The condensed interim financial statements are unaudited and have not been reviewed by the auditors and were approved by the board of Directors on 4 September 2023.

The Financial Statements are presented in £ unless otherwise stated which is the Company's functional and presentational currency.

Comparative figures

The comparative figures cover the period from incorporation on 4 November 2021 to 30 June 2022.

Going concern

The Financial Statements has been prepared on a going concern basis. The Directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. Thus, they continue to adopt the going concern basis of accounting in preparing the Financial Statements.

The financial position of the Company, its cash flows and liquidity position are set out in these financial statements. As at 30 June 2023, the Company had cash and cash equivalents of £723,127.

The Company has prepared monthly cash flow forecasts that supports the conclusion of the Directors that they expect sufficient funding to be available to meet the Company's anticipated cash flow requirements for at least the next 12 months.

3       Significant accounting policies

The Company's Financial Statements are based on the following policies which have been consistently applied:

Cash and cash equivalents

The Directors consider any cash on short-term deposits and other short-term investments to be cash equivalents.

The Company considers the credit ratings of banks in which it holds funds in order to reduce its exposure to credit risk. The Company will only keep its holdings of cash and cash equivalents within institutions which have a strong credit rating.

Trade and other receivables

Receivables are initially recognised at fair value when related amounts are invoiced then carried at this amount less any allowances for doubtful debts or provision made for impairment of these receivables.

Trade and other payables

These financial liabilities are all non-interest bearing and are initially recognised at the fair value of the consideration payable.

Financial instruments

Initial recognition

A financial asset or financial liability is recognised in the statement of financial position of the Company when it arises or when the Company becomes part of the contractual terms of the financial instrument.

Derecognition

A financial asset is derecognised when:

-     the rights to receive cash flows from the asset have expired, or

-     the Company has transferred its rights to receive cash flows from the asset or has undertaken the commitment to fully pay the cash flows received without significant delay to a third party under an arrangement and has either (a) transferred substantially all the risks and the assets of the asset or (b) has neither transferred nor held substantially all the risks and estimates of the asset but has transferred the control of the asset.

Earnings per share

The Company presents basic and diluted earnings per share ("EPS") data for its ordinary shares. Basic EPS is calculated by dividing the profit or loss attributable to ordinary shareholders of the Company by the weighted average number of ordinary shares outstanding during the period. Diluted EPS is calculated by adjusting the earnings and number of shares for the effects of dilutive potential ordinary shares.

Equity

An equity instrument is any contract that evidences a residual interest in the assets of the Company after deducting all of its liabilities. Equity instruments issued by the Company are recorded at the proceeds received net of direct issue costs.

Ordinary shares are classified as equity.

-     Share capital account represents the nominal value of the shares issued.

-     The share premium account represents premiums received on the initial issuing of the share capital. Any transaction costs associated with the issuing of shares are deducted from share premium, net of any related income tax benefits.

-     The share-based premium reserve arises from the requirement to value share warrants in existence at the period end at fair value.

-     Retained earnings comprise cumulative results as disclosed in the Statement of Comprehensive Income.

Taxation

Tax currently payable is based on taxable profit or loss for the period. Taxable profit or loss differs from profit or loss as reported in the income statement because it excludes items of income and expense that are taxable or deductible in other periods and it further excludes items that are never taxable or deductible. The Company's liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the balance sheet date.

Deferred tax is recognised on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit and is accounted for using the balance sheet liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised. Such assets and liabilities are not recognised if the temporary difference arises from initial recognition of goodwill or from the initial recognition (other than in a business combination) of other assets and liabilities in a transaction that affects neither the taxable profit nor the accounting profit.

Deferred tax liabilities are recognised for taxable temporary differences arising on investments in subsidiaries and associates, and interests in joint ventures, except where the Company is able to control the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future.

The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.

4              New standards, interpretations and amendments adopted from 1 January 2023:

A number of new standards and amendments to standards and interpretations have been issued but are not yet effective and, in some cases, have not yet been adopted by the UK. The Directors do not expect that the adoption of these standards will have a material impact on the Company's Financial Statements.

During the period, the Company has adopted the following new IFRSs (including amendments thereto) and IFRIC interpretations that became effective for the first time.

Standard	Effective date, annual period beginning on or after
Disclosure of Accounting Policies (Amendments to IAS 1 Presentation of Financial Statements and IFRS Practice Statement 2)	1 January 2023
Definition of Accounting Estimates (Amendments to IAS 8 Accounting policies, Changes in Accounting Estimates and Errors)	1 January 2023
Deferred Tax related to Assets and Liabilities arising from a Single Transaction (Amendments to IAS 12 Income Taxes)	1 January 2023
Deferred tax assets and liabilities related to pillar two income taxes (Amendments to IAS 12 Income Taxes)	1 January 2023

Standards issued but not yet effective:

There are no standards and interpretations issued but not yet effective and not early adopted which are expected to have a material impact on the Company.

5          Critical accounting estimates and judgments

In preparing the condensed interim financial statements, the Directors have to make judgments on how to apply the Company's accounting policies and make estimates about the future. The Directors do not consider there to be any critical judgments that have been made in arriving at the amounts recognised in the condensed interim financial statements.

6         Operating expenses by nature

Administrative expenses	Six months ended 30 June 2023 £	Period ended 30 June 2022 £
Legal and professional costs	8,379	92,602
Auditors - non-audit costs	6,000	-
London Stock Exchange fees	8,985	40,855
Website costs	4,258	10,422
Company secretarial	16,588	8,914
Company set-up	-	492
Share-based payment expense	5,470	-
Broking costs	10,800	-
Share registrars	2,407	-
Other expenses	11,963	10,780
Total administrative expenses	74,850	164,065

7         Directors and employees

There were no employees during the period. None of the Directors received any remuneration during the period.

8         Finance income

Interest received		Six months ended 30 June 2023 £	Period ended 30 June 2022 £
Interest received on bank deposits		5,252	-
Total finance income		5,252	-

9          Taxation

The Company has made no provision for taxation as it has not yet generated any taxable income. A reconciliation of income tax expense applicable to the loss before taxation at the statutory tax rate to the income tax expense at the effective tax rate of the Company is as follows:

	Six months ended 30 June 2023 £	Period ended 30 June 2022 £
Loss before taxation	(69,598)	(164,065)
Tax calculated at the statutory rate of 22% (30 June 2022: 19%)	(15,312)	(31,172)
Tax effects of:
Unrecognised tax losses	15,312	31,172
Tax expense	-	-

Tax has been calculated based on the average rate of 22% which was the effective rate for small companies for the period. 

In the 2021 Budget, the UK Chancellor announced legislation to increase the main rate of corporation tax to 25% from 1 April 2023.

As at 30 June 2023, the Company had estimated unutilised tax losses of approximately £290,000 available for relief against future profits. No related deferred tax asset has been provided for in the accounts based on the uncertainty as to when profits will be generated against which to relieve such asset.

10        Earnings per ordinary share

Basic earnings per ordinary share is calculated by dividing the earnings attributable to Shareholders by the weighted average number of ordinary shares outstanding during the period. Diluted earnings per share is calculated by dividing earnings by the weighted average number of shares in issue and potential dilutive shares outstanding during the period.

Because the Company was in a net loss position, diluted loss per share excludes the effects of ordinary share equivalents consisting of warrants, which are anti-dilutive.

	Six months ended 30 June 2023 £	Period ended 30 June 2022 £
Loss for the period attributable to shareholders	(69,598)	(164,065)
Weighted average number of shares in issue	10,500,000	3,945,834
Earnings per share (£)	(0.007)	(0.04)

11        Cash and cash equivalents

	At 30 June 2023  £	At 31 December 2022 £
Cash at bank	723,127	809,472
	723,127	809,472

12        Share capital and warrants

	Number of Ordinary Shares		Number of Deferred Shares		Ordinary Shares £		Deferred Shares  £1		Total £
On incorporation (Ordinary Shares of £1.00 each)	1		-		1		-		1
Issue of Ordinary Shares of £1.00 each	49,999				49,999				49,999
Share conversion	450,000		45,000		-		-		-
Subscription for Ordinary Shares of £0.01 each	1,000,000		-		100,000		-		100,000
Placing of Ordinary Shares of £0.01 each	9,000,000		-		900,000		-		900,000
At 31 December 2022 and 30 June 2023	10,500,000		45,000		1,050,000		-		1,050,000

Warrants

The Company granted a total of 12,780,000 unlisted Warrants, on Admission in April 2022, in relation to the share capital of the Company.

Using the Black-Scholes pricing model, the fair value of the Director Warrants and Broker Warrants has been calculated at 1.56 pence each, giving rise to an aggregate expense for the period of £5,470 (period ended 30 June 2022: £nil).

No warrants were exercised in the period ended 30 June 2023 and accordingly all 12,780,000 warrants remained outstanding. The inputs in the model were as follows:

Director Warrants and Broker Warrants:

-              Share price: 10.0 pence

-              Exercise price: 15.0 pence

-              Expected life of warrant: 3 years

-              Risk-free rate: 1.76%

-              Volatility: 40.0%

13        Related party transactions

During the period, the Company reimbursed expenses totalling £2,740 incurred on behalf of the Company by John Croft and £944 by Robin Stevens.

14        Post balance sheet events

No events subsequent to 30 June 2023, have occurred which require disclosure in these financial statements.

15        Ultimate controlling party

At 30 June 2023, the Company did not have any single identifiable controlling party.

16.      Half Year Report

A copy of this half year interim report, as well as the annual statutory accounts to 31 December 2022 are available on the Company's website http:www.aurarenewables.com.                   

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