Inteliqo Ltd - Interim Results

16 December 2022

Inteliqo Limited
(“Inteliqo”, the “Company”)

Interim Results

Inteliqo (AQSE: IQO), a start-up technology company that provides sales, marketing and distribution services to technology product owners under long-term distribution agreements, is pleased to announce its unaudited interim results for the 6-month period ended 30 September 2022. A full copy of the Interim Report will be obtainable from the Company's website at https://inteliqo.com/ .

This announcement contains information which, prior to its disclosure, constituted inside information as stipulated under Regulation 11 of the Market Abuse (Amendment)(EU Exit) Regulations 2019/310 (as amended).

The directors of Inteliqo Limited accept responsibility for this announcement.

For more information, please contact:

Inteliqo Limited: Chairman’s Report for the period ended 30 September 2022

I am delighted to report on the unaudited interim results of Inteliqo Limited (the “Company”) for the six months period that ended 30 September 2022. This is the first report for the Company.

Formation and Initial Public Offering

The Company was incorporated in Guernsey on 3rd May 2022. Michael Joseph Hill, Chief Executive Officer (the “CEO”) was appointed as a director of the Company on 7th June 2022. Joseph Truelove as Non-Executive Director and Chairman (the “Chairman”), Ray Smart as Finance Director (the “FD”) and Shaun Drake as Company Secretary were all appointed on 27th June 2022 and last but not least Bruce Watterson was appointed as a Non-Executive Director on 20th July 2022.

On 5th August 2022, the Company was admitted to the Access segment of AQSE and the commencement of trading of the Company's Ordinary Shares followed a successful subscription and placed for a total of 2,370,000 Ordinary Shares at £0.0250 per ordinary share, raising gross proceeds of £59,250. The Company Gross Proceeds of the Fundraising and issue of Existing Shares was £832,250 (before expenses).

On Admission, the Company had 112,500,000 Ordinary Shares in issue and the market capitalisation of the Company was approximately £2,812,500. The Company's admission document is available to view on its website  https://inteliqo.com/.   

Objective

Inteliqo is a start-up technology company that provides sales, marketing and distribution services to cutting-edge consumer technology brands under long-term distribution agreements.

The principal activity of the Company is to appoint and license resellers for defined territories on the basis that these resellers will enter into agreements with the Company to purchase a minimum number of products from the Company on an annual basis with the intention of reselling them within their territory.

Operations

The iQ product is a smart translation earphone (earbuds) system and application which offers integrated real-time speech translation in over 100 languages, built-in smart assist (google and siri), multiple microphones and HD sound (www.ipedia.co).

Reseller agreements have now been signed that enable the Company to sell the Ipedia iQ products in 9 Countries. Negotiations for further territories are ongoing and the Company will announce additional contracts in the coming months. 

Results

At the interim statement date of 30th September 2022, the results of the Company reflect the set up and listing of the Company prior to the commencement of sales and resulted in a loss of $428k with a basic earnings per share from continuing activities of $0.007. 

Outlook

Clearly the Company is at the beginning of its life. 

The Company is forecast to operate profitably from February 2023 with positive cash flows in the next period.

My fellow board members and I are confident that the Company will be very successful having secured several Exclusive Reseller Agreements that enable sales across 9 Countries. 

Ray Smart

Financial Director

12 December 22

Inteliqo Limited: Sstatement of comprehensive income and retained earnings for the period ended 30 September 2022

Inteliqo Limited: Statement of financial position as at 30 September 2022

Inteliqo Limited: Statement of changes in equity for the period ended 30 September 2022

Inteliqo Limited Statement of cash flows for the period ended 30 September 2022

Inteliqo Limited accounting policies and explanatory notes to the financial statements for the

period ended 30 September 2022

1.    General information

Inteliqo Limited (the Company) is a limited company incorporated in Guernsey on 3 May 2022. The address of its registered office and principal place of business is Dixcart House, Sir William Place, St Peter Port Guernsey, GY1 1GX. The principal activity of the Company is the distribution of electronic goods.

2.    Basis of preparation and accounting policies

These interim financial statements have been prepared in accordance with IAS 34 Interim Financial Reporting. They do not include all disclosures that would otherwise be required in a complete set of financial statements.

These financial statements have been prepared on an accruals basis and under the historical cost convention in accordance with the International Financial Reporting Standard issued by the International Accounting Standards Board and are presented in US Dollars, the functional currency of the Company.

The Company has applied the same accounting policies and methods of computation in these interim financial statements it intends to apply in its first full financial statements to 31 March 2023.

a.    Foreign currency transactions and balances

Foreign currency transactions are translated into the functional currency of the Company using the exchange rates prevailing at the dates of the transactions (spot exchange rate). Foreign exchange gains and losses resulting from the settlement of such transactions and from the remeasurement of monetary items denominated in foreign currency at period-end exchange rates are recognised in profit or loss.

Non-monetary items are not retranslated at the period-end. They are measured at historical cost (translated using the exchange rates at the transaction date), except for non-monetary items measured at fair value which are translated using the exchange rates at the date when fair value was determined.

b.    Segment reporting

The Company has one operating segment: the distribution of electronic goods.

c.     Climate-related matters

The potential impact of climate-related matters has been considered in the preparation of financial statements, including environmental legislations and commitments made by the Company which may affect the value of financial assets and liabilities.

d.    Revenue recognition

The Company enters into contracts with its customers for the sale of goods. Revenue is measured at the fair value of the consideration received or receivable, net of discounts and sales-related taxes.  The Company recognises revenue from its contracts with customers when the goods are delivered. In determining whether to recognise revenue, the Company follows a 5-step process:

1.    Identifying the contract with a customer

2.    Identifying the performance obligations

3.    Determining the transaction price

4.    Allocating the transaction price to the performance obligations, and then

5.    Recognising revenue when/as performance obligations are satisfied.

e.     Operating expenses

Operating expenses are recognised in profit or loss upon utilisation of the service or as incurred.

f.     IT equipment

Items of IT equipment are initially measured at cost, including any costs directly attributable to bringing the assets to the location and condition necessary for them to be capable of operating in the manner intended by the Company’s management, less accumulated depreciation, and impairment losses.

Depreciation is recognised on a straight-line basis to write down the cost less estimated residual value of IT equipment with a useful life of 3 years applied.

At each reporting date, IT equipment is reviewed to determine whether there is any indication that those assets have suffered an impairment loss. If there is an indication of possible impairment, the recoverable amount of any affected asset (or group of related assets) is estimated and compared with its carrying amount. If the estimated recoverable amount is lower, the carrying amount is reduced to its estimated recoverable amount and an impairment loss is recognised immediately in profit or loss.

g.    The Company as a lessee

The Company rents its office space for terms of less than one year and recognises the rental agreement as an operating lease and expenses the lease costs to profit or loss.

h.    Financial instruments

i.       Recognition and derecognition

Financial assets and financial liabilities are recognised when the Company becomes a party to the contractual provisions of the financial instrument. Financial assets are derecognised when the contractual rights to the cash flows from the financial asset expire, or when the financial asset and substantially all the risks and rewards are transferred. A financial liability is derecognised when it is extinguished, discharged, cancelled or expires.

ii.      Classification, initial measurement and subsequent measurement of financial assets

Financial assets, which comprise trade and other receivables, are classified at fair value through profit or loss (FVTPL) and are initially measured at fair value.  Subsequently assets in this category are measured at fair value with gains or losses recognised in profit or loss. The fair values of financial assets in this category are determined by reference to active market transactions or using a valuation technique where no active market exists.

iii.     Impairment of financial assets

IFRS 9’s impairment requirements use forward-looking information to recognise expected credit losses – the ‘expected credit loss (ECL) model’. Instruments within the scope of the requirements included trade receivables recognised and measured under IFRS15.

The Company considers a broader range of information when assessing credit risk and measuring expected credit losses, including past events, current conditions, reasonable and supportable forecasts that affect the expected collectability of the future cash flows of the instrument.

In applying this forward-looking approach, a distinction is made between:

•      financial instruments that have not deteriorated significantly in credit quality since initial recognition or that have low credit risk (‘Stage 1’) and

•      financial instruments that have deteriorated significantly in credit quality since initial recognition and whose credit risk is not low (‘Stage 2’).

‘Stage 3’ would cover financial assets that have objective evidence of impairment at the reporting date.

‘12-month expected credit losses’ are recognised for the first category (ie Stage 1) while ‘lifetime expected credit losses’ are recognised for the second category (ie Stage 2).

Measurement of the expected credit losses is determined by a probability-weighted estimate of credit losses over the expected life of the financial instrument.

iv.     Classification and measurement of financial liabilities

The Company’s financial liabilities include trade and other payables. Financial liabilities are initially measured at fair value. Subsequently, financial liabilities are measured at amortised cost using the effective interest method except for derivatives and financial liabilities designated at FVTPL, which are carried subsequently at fair value with gains or losses recognised in profit or loss (other than derivative financial instruments that are designated and effective as hedging instruments).

All interest-related charges and, if applicable, changes in an instrument’s fair value that are reported in profit or loss are included within finance costs or finance income.

i.     Income tax

Income tax expense represents the sum of the tax currently payable and deferred tax.

The tax currently payable is based on taxable profit for the year.

Deferred tax is recognised on differences between the carrying amounts of assets and liabilities in the financial statements and their corresponding tax bases (known as temporary differences). Deferred tax liabilities are generally recognised for all temporary differences that will result in taxable amounts in determining taxable profit (tax loss) of future periods when the carrying amount of the asset or liability is recovered or settled (taxable temporary differences). Deferred tax assets are generally recognised for all temporary differences that will result in amounts that are deductible in determining taxable profit (tax loss) of future periods when the carrying amount of the asset or liability is recovered or settled (deductible temporary differences)—but only to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be utilised.

The carrying amount of deferred tax assets is reviewed at each reporting date and is adjusted to reflect the current assessment of future taxable profits. Any adjustments are recognised in profit or loss.

Deferred tax is calculated at the tax rates that are expected to apply to the taxable profit (tax loss) of the periods in which it expects the deferred tax asset to be realised or the deferred tax liability to be settled, on the basis of tax rates that have been enacted or substantively enacted by the end of the reporting period.

j.     Cash and cash equivalents

Cash and cash equivalents comprise cash at bank.

k.    Equity and reserves

Share capital represents the nominal value of shares that have been issued. Share premium includes any premiums received over and above the nominal value of the issue of share capital. Any transaction costs associated with the issuing of shares are deducted from share premium.

The Company recognises shares to be issued under warrants issued by the Company at the time the warrant is exercised.  The maximum number of shares that can be issued under warrants issued by the company are included in the weighted average number of shares used in determining diluted earnings per share.

l.     Provisions, contingent assets and contingent liabilities

Provisions for any claims against the Company are recognised when the Company has a present legal or constructive obligation as a result of a past event, it is probable that an outflow of economic resources will be required from the Company and amounts can be estimated reliably. The timing or amount of the outflow may still be uncertain.

Provisions are measured at the estimated expenditure required to settle the present obligation, based on the most reliable evidence available at the reporting date, including the risks and uncertainties associated with the present obligation. Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is determined by considering the class of obligations as a whole. Provisions are discounted to their present values, where the time value of money is material. Any reimbursement that the Company is virtually certain to collect from a third party with respect to the obligation is recognised as a separate asset. However, this asset may not exceed the amount of the related provision. No liability is recognised if an outflow of economic resources as a result of present obligations is not probable. Such situations are disclosed as contingent liabilities unless the outflow of resources is remote.

3.    Significant management judgement in applying accounting policies and estimation uncertainty

When preparing the Company’s financial statements, management makes a number of judgements, estimates and assumptions about the recognition and measurement of assets, liabilities, revenue and expenses.

The following are the judgements made by management in applying the accounting policies of the Company that have the most significant effect on these financial statements.

a.   Recognition of contract revenue over time or at a point in time

For some of the Company’s contracts with customers significant judgement is required to assess whether control of the related performance obligation(s) transfers to the customer over time or at a point in time in accordance with IFRS 15.

b.    Useful lives and residual values of depreciable assets

Management reviews its estimate of the useful lives and residual values of depreciable assets at each reporting date, based on the expected utility of the assets. Uncertainties in these estimates relate to technological obsolescence that may change the utility of certain software and IT equipment and environmental regulations that can make polluting assets to be depreciated more quickly.

4.    Earnings per share and dividends

Earnings per share, both the basic and diluted earnings per share, have been calculated using the profit attributable to shareholders of the Company as the numerator, ie no adjustments to profit were necessary. The reconciliation of the weighted average number of shares for the purposes of diluted earnings per share to the weighted average number of ordinary shares used in the calculation of basic earnings per share is as follows:

5.    Share capital

The share capital of the Company comprises 112,500,000 ordinary shares with par value GBP0.0001.  An additional 15,027,500 ordinary shares with par value GBP0.0001 are authorised but unissued.  The Company has issued warrants over 4,972,500 ordinary shares with par value GBP0.0001.

6.    Commitments under operating leases

The Group rents an office under an operating lease which has a 1 month notice period. 

7.    Related party transactions

Key management of the Company are the executive and non-executive directors. Key management personnel remuneration includes the following expenses:

8.    Approval of Interim Report

This Interim Report was approved by the board of directors and authorised for issue on 12 December 2022.