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Africa Mobile Networks Limited
Registered number: 08531564
Annual report and
financial statements
For the year ended 31 December 2022
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AFRICA MOBILE NETWORKS LIMITED
COMPANY INFORMATION
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Chartered Accountants & Statutory Auditor
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AFRICA MOBILE NETWORKS LIMITED
CONTENTS
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Independent Auditor's Report
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Consolidated Statement of Comprehensive Income
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Consolidated Statement of Financial Position
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Company Statement of Financial Position
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Consolidated Statement of Changes in Equity
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Company Statement of Changes in Equity
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Consolidated Statement of Cash Flows
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Notes to the Financial Statements
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AFRICA MOBILE NETWORKS LIMITED
GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
The Directors present their Strategic Report for Africa Mobile Networks Limited for the year ended 31 December 2022.
The group’s Turnover grew from $17.5m to $19.0m during the year generating Revenues in multiple countries across sub-Saharan Africa. Revenue growth was achieved in both existing and new countries through traffic and subscriber growth and from additional new Tower sites. During the year over a thousand sites were added and the Tower portfolio count grew from 2,028 at the start of the year to 3,072 at the end of the year with activities and operations having expanded into seventeen countries including the UK during the year.
The group’s adjusted EBITDA has continued to steadily grow throughout the year to $4.5m. The company reported a loss before taxation of $2.3m which continues to reflect the high levels of non-cash related costs incurred in the business which include depreciation on both the existing and new Tower related Capital assets and also the non-serviced payment in kind interest on the Convertible Loan notes.
The Group also reported other income of $2.1m which relates to the release of money disbursed under a long term loan agreement which was cancelled on April 1st, 2022 by the Lender without the requirement to repay any of the outstanding debt. A provision has been made for the potential non-recovery of some outstanding disputed invoices in Cameroon and also some potential foreign exchange transaction losses in Nigeria.
The other notable events during the year include the full early redemption of the Convertible Loan notes with Intelsat which has resulted in a partial repayment of $13.1m and conversion of the $10m balance into Equity and the issue of 837,731 new Ordinary C shares in the company.
At the end of 2022, the group has no Bank Debt or Loans remaining on its Statement of Financial Position, but the group signed a new joint Debt facility agreement in December 2022 with Finnfund and Blue Orchard for $20m with $15m being already disbursed through September 2023. A further disbursement of $5m is expected to follow in March 2024.
Key performance indicators
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The group and individual companies measure a number of financial and operational indicators in assessing performance of the business as a whole. The main ones are Revenue, Adjusted EBITDA and Tower counts highlighted below:
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Tower count (no. of live sites)
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- 1 -
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AFRICA MOBILE NETWORKS LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
This report was approved by the board and signed on its behalf.
- 2 -
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AFRICA MOBILE NETWORKS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
The Directors present their report and the financial statements for the year ended 31 December 2022.
Directors' responsibilities statement
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The Directors are responsible for preparing the Group Strategic Report, the Directors' Report and the consolidated financial statements in accordance with applicable law and regulations.
Company law requires the Directors to prepare financial statements for each financial year. Under that law the Directors have elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and the Group and of the profit or loss of the Group for that period.
In preparing these financial statements, the Directors are required to:
∙select suitable accounting policies for the Group's financial statements and then apply them consistently;
∙make judgements and accounting estimates that are reasonable and prudent;
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group will continue in business.
The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and the Group and to enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The principal activity of the Group is the research and development into, and construction, installation and operation of rural telecommunications base stations across sub-Saharan Africa.
The loss for the year, after taxation, amounted to $4,213k (2021 - loss $3,554k).
The Directors who served during the year were:
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AFRICA MOBILE NETWORKS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
The financial statements have been prepared on the going concern basis which assumes that the Group and Company will continue in operational existence for the foreseeable future. The Directors have reviewed cash flow forecasts for a period of not less than 12 months from the date of approval of the financial statements and are confident that the Group and Company will be able to pay its liabilities as they fall due. On this basis, the Directors consider it appropriate to prepare the financial statements on the going concern basis..
The prospects for the company and the group are very encouraging. The business continues to make good progress in building its Tower portfolio across multiple countries which has been underpinned by the improvements seen previously in EBITDA and Cash flow at an operating entity level. With much of the future funding requirements secured with the new $20m Debt facility the group expects to grow the site count to over 4,000 in 2023 and to over 6,000 in the next couple of years which will involve building out in existing territories and expanding into new countries across sub-saharan Africa and potentially into other continents as well. This will allow the business to diversify its portfolio even further and reduce its reliance on any one country or operator but at the same time to sustainably grow group revenues and profitability.
The company and group as a whole continues to invest time, resources and funds into the research and development of both new and existing solutions to the rural telecommunications market. The business achieves this by constantly reviewing the performance and efficiency of existing Tower designs by working closely with existing service and equipment suppliers. At the same time the business is very proactive in developing and innovating in-house technical and software solutions and its own proprietary equipment and products to support the continued growth of the group.
Post balance sheet events
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On March 24th 2023, a first disbursement of $10m was received having satisfied all of the Condition Precedents and achieving Financial close on the Debt funding facility with Finnfund and Blue Orchard. The second disbursement of $5m was received in September 2023 on schedule per the terms of the agreement.
Disclosure of information to auditor
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Each of the persons who are Directors at the time when this Directors' Report is approved has confirmed that:
∙so far as the Director is aware, there is no relevant audit information of which the Company and the Group's auditor is unaware, and
∙the Director has taken all the steps that ought to have been taken as a Director in order to be aware of any relevant audit information and to establish that the Company and the Group's auditor is aware of that information.
The auditor, Mazars LLP, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
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AFRICA MOBILE NETWORKS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
This report was approved by the board and signed on its behalf.
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AFRICA MOBILE NETWORKS LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF AFRICA MOBILE NETWORKS LIMITED
Qualified opinion on group financial statements
We have audited the group financial statements of Africa Mobile Networks Limited (the 'Parent Company') and its subsidiaries (the ‘Group’) for the year ended 31 December 2022 which comprise the Consolidated Statement of Comprehensive Income, the Consolidated Statement of Financial Position, the Company Statement of Financial Position, the Consolidated Statement of Changes in Equity, the Company Statement of Changes in Equity, the Consolidated Statement of Cashflows and notes to the financial statements, including a summary of significant accounting policies.
The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (United Kingdom Generally Accepted Accounting Practice).
In our opinion, except for the effects of the matter described in the “Basis for Qualified Opinion on the group financial statements” section of our report, the group financial statements:
• give a true and fair view of the state of the Group's affairs as at 31 December 2022 and of the Group's loss for the year then ended;
• have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
• have been prepared in accordance with the requirements of the Companies Act 2006.
Opinion on parent company financial statements
We have audited the parent company financial statements of Africa Mobile Networks Limited (the ‘Parent Company’) for the year ended 31 December 2022 which comprise the Company Statement of Financial Position, the Company Statement of Changes in Equity and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (United Kingdom Generally Accepted Accounting Practice).
In our opinion, the financial statements:
∙give a true and fair view of the state of the Parent Company’s affairs as at 31 December 2022;
∙have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
∙have been prepared in accordance with the requirements of the Companies Act 2006.
Basis for qualified opinion on the group financial statements
The audit report of the prior period financial statements (year ended 31 December 2021) included a qualified opinion in respect of the audit evidence available to us. The audit evidence for that year was limited in that a subsidiary in the Democratic Republic of the Congo, Africa Mobile Networks DRC SARLU, recorded cash transactions in its financial information concerning other income and expenditure amounting to $1,393k and $1,386k respectively for which there was no independent supporting documentation. Owing to the nature of the subsidiary’s records, we were unable to obtain sufficient appropriate audit evidence regarding completeness and accuracy of the cash transactions and hence the recorded amounts of other income and expenditure in that year.
Hence the audit opinion for the 12-month period ended 31 December 2022 is qualified because of the effects or possible effects of the matters giving rise to the qualified opinion on the corresponding figures on the comparability of the current period’s figures and the corresponding figures.
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AFRICA MOBILE NETWORKS LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF AFRICA MOBILE NETWORKS LIMITED
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the "Auditor’s responsibilities for the audit of the financial statements" section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our qualified opinion.
Basis for opinion on the parent company financial statements
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the Parent Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group's nor the Parent Company’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
Other information
The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
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AFRICA MOBILE NETWORKS LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF AFRICA MOBILE NETWORKS LIMITED
Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
As described in the “Basis for Qualified Opinion on the group financial statements” section of our report, we were unable to satisfy ourselves concerning the cash transactions of the subsidiary Africa Mobile Networks DRC SARLU in the Democratic Republic of the Congo in the comparative period. We have concluded that where the other information refers to income or expenditure in the prior year, it may be materially misstated for the same reason.
Opinions on other matters prescribed by the Companies Act 2006
Except for the possible effects of the matter described in the "Basis for Qualified Opinion on the group financial statement" section of our report, in our opinion, based on the work undertaken in the course of the audit:
∙the information given in the Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
∙the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
Except for the matter described in the "Basis for Qualified Opinion on the group financial statements" section of our report, in light of the knowledge and understanding of the Group and the Parent Company and their environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Directors' Report.
Arising solely from the limitation on the scope of our work relating to cash transactions in the prior year, as set out in the "Basis for Qualified Opinion on the group financial statements" section of our report:
• we have not received all the information and explanations we require for our audit.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
∙adequate accounting records have not been kept by the Parent Company, or returns adequate for our audit have not been received from branches not visited by us; or
∙the Parent Company financial statements are not in agreement with the accounting records and returns; or
∙certain disclosures of directors' remuneration specified by law are not made.
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AFRICA MOBILE NETWORKS LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF AFRICA MOBILE NETWORKS LIMITED
Responsibilities of Directors
As explained more fully in the Directors' Responsibilities Statement set out on page 3, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the Group and the Parent Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors intend either to liquidate the Group or the Parent Company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud.
Based on our understanding of the Group and Parent Company and its industry, we considered that non-compliance with the following laws and regulations might have a material effect on the financial statements: employment regulation, health and safety regulation, anti-money laundering regulation.
To help us identify instances of non-compliance with these laws and regulations, and in identifying and assessing the risks of material misstatement in respect to non-compliance, our procedures included, but were not limited to:
∙Inquiring of management and, where appropriate, those charged with governance, as to whether the Group and the Parent Company is in compliance with laws and regulations, and discussing their policies and procedures regarding compliance with laws and regulations;
∙Inspecting correspondence, if any, with relevant licensing or regulatory authorities;
∙Communicating identified laws and regulations to the engagement team and remaining alert to any indications of non-compliance throughout our audit; and
∙Considering the risk of acts by the Group and the Parent Company which were contrary to applicable laws and regulations, including fraud.
We also considered those laws and regulations that have a direct effect on the preparation of the financial statements, such as tax legislation, pension legislation, the Companies Act 2006.
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AFRICA MOBILE NETWORKS LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF AFRICA MOBILE NETWORKS LIMITED
In addition, we evaluated the directors’ and management’s incentives and opportunities for fraudulent manipulation of the financial statements, including the risk of management override of controls, and determined that the principal risks related to posting manual journal entries to manipulate financial performance, management bias through judgements and assumptions in significant accounting estimates, in particular in relation to fixed assets and Intercompany debtor recoverability, revenue recognition (which we pinpointed to the cut off assertion) and significant one-off or unusual transactions.
Our audit procedures in relation to fraud included but were not limited to:
∙Making enquiries of the directors and management on whether they had knowledge of any actual, suspected or alleged fraud;
∙Gaining an understanding of the internal controls established to mitigate risks related to fraud;
∙Discussing amongst the engagement team the risks of fraud; and
∙Addressing the risks of fraud through management override of controls by performing journal entry testing.
There are inherent limitations in the audit procedures described above and the primary responsibility for the prevention and detection of irregularities including fraud rests with management. As with any audit, there remained a risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations or the override of internal controls.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
Use of the audit report
This report is made solely to the Parent Company's members as a body in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Parent Company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Parent Company and the Parent Company's members as a body for our audit work, for this report, or for the opinions we have formed.
Stephen Brown (Senior statutory auditor)
for and on behalf of
Mazars LLP
Chartered Accountants and Statutory Auditor
The Pinnacle
160 Midsummer Boulevard
Milton Keynes
MK9 1FF
2 October 2023
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AFRICA MOBILE NETWORKS LIMITED
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2022
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Interest receivable and similar income
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Interest payable and similar expenses
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Loss for the financial year
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Owners of the parent Company
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All activities relate to continued operations.
There were no recognised gains and losses for 2022 or 2021 other than those included in the consolidated statement of comprehensive income.
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The notes on pages 21 to 41 form part of these financial statements.
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AFRICA MOBILE NETWORKS LIMITED
REGISTERED NUMBER: 08531564
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2022
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Debtors: amounts falling due within one year
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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Creditors: amounts falling due after more than one year
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Equity attributable to owners of the parent Company
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The financial statements were approved and authorised for issue by the board on 29 September 2023 and were signed on its behalf on 29 September 2023.
The notes on pages 21 to 41 form part of these financial statements.
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AFRICA MOBILE NETWORKS LIMITED
REGISTERED NUMBER: 08531564
COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2022
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Debtors: amounts falling due within one year
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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Creditors: amounts falling due after more than one year
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Profit and loss account carried forward
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- 13 -
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AFRICA MOBILE NETWORKS LIMITED
REGISTERED NUMBER: 08531564
COMPANY STATEMENT OF FINANCIAL POSITION (CONTINUED)
AS AT 31 DECEMBER 2022
The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of Comprehensive Income in these financial statements. The loss after tax of the Parent Company for the year was $952k (2021: $1,849k).
The financial statements were approved and authorised for issue by the board and were signed on its behalf on 29 September 2023.
The notes on pages 21 to 41 form part of these financial statements.
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AFRICA MOBILE NETWORKS LIMITED
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022
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At 1 January 2022 (as previously stated)
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At 1 January 2022 (as restated)
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Comprehensive income for the year
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Currency translation differences
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Other comprehensive income for the year
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Total comprehensive income for the year
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Contributions by and distributions to owners
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Shares issued during the year
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Total transactions with owners
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The notes on pages 21 to 41 form part of these financial statements.
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AFRICA MOBILE NETWORKS LIMITED
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2021
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At 1 January 2021 (as previously stated)
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At 1 January 2021 (as restated)
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Comprehensive income for the year
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Loss for the year (as restated)
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Total comprehensive income for the year
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Contributions by and distributions to owners
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Shares issued during the year
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Total transactions with owners
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The notes on pages 21 to 41 form part of these financial statements.
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AFRICA MOBILE NETWORKS LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022
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At 1 January 2022 (as previously stated)
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At 1 January 2022 (as restated)
|
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Comprehensive income for the year
|
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Currency translation differences
|
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Other comprehensive income for the year
|
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Total comprehensive income for the year
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Contributions by and distributions to owners
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Shares issued during the year
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Total transactions with owners
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The notes on pages 21 to 41 form part of these financial statements.
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- 17 -
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|
AFRICA MOBILE NETWORKS LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2021
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At 1 January 2021 (as previously stated)
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At 1 January 2021 (as restated)
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Comprehensive income for the year
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Loss for the year (as restated)
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Total comprehensive income for the year
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Contributions by and distributions to owners
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Shares issued during the year
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The notes on pages 21 to 41 form part of these financial statements.
|
- 18 -
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AFRICA MOBILE NETWORKS LIMITED
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2022
Cash flows from operating activities
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Loss for the financial year
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Amortisation of intangible assets
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Depreciation of tangible assets
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Corporation tax (paid)/received
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Foreign exchange difference
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Net cash generated from operating activities
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Cash flows from investing activities
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Purchase of intangible fixed assets
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Purchase of tangible fixed assets
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Net cash from investing activities
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- 19 -
|
|
AFRICA MOBILE NETWORKS LIMITED
CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
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Cash flows from financing activities
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Net cash used in financing activities
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Net (decrease)/increase in cash and cash equivalents
|
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Cash and cash equivalents at beginning of year
|
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Cash and cash equivalents at the end of year
|
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Cash and cash equivalents at the end of year comprise:
|
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|
The notes on pages 21 to 41 form part of these financial statements.
|
- 20 -
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AFRICA MOBILE NETWORKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
Africa Mobile Networks Limited (the 'Group') is a private company, limited by shares, incorporated in England and Wales. The registered company number is 08531564. The address of its registered office is 6 Whittle Court, Davy Avenue, Knowlhill, Milton Keynes, Buckinghamshire, United Kingdom, MK5 8FT.
The principal activity of the Group is the construction, installation and operation of rural telecommunications base stations across sub-Saharan Africa.
The Group financial statements are presented in US Dollars and all values are rounded to the nearest US Dollars.
2.Accounting policies
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Basis of preparation of financial statements
|
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires Group management to exercise judgement in applying the Group's accounting policies (see note 3).
The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of Comprehensive Income in these financial statements.
The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the Statement of Financial Position, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Consolidated Statement of Comprehensive Income from the date on which control is obtained. They are deconsolidated from the date control ceases.
In accordance with the transitional exemption available in FRS 102, the group has chosen not to retrospectively apply the standard to business combinations that occurred before the date of transition to FRS 102, being 01 October 2016.
The financial statements have been prepared on the going concern basis which assumes that the Group and Company will continue in operational existence for the foreseeable future. The Directors have reviewed cash flow forecasts for a period of not less than 12 months from the date of approval of the financial statements and are confident that the Group and Company will be able to pay its liabilities as they fall due. On this basis, the Directors consider it appropriate to prepare the financial statements on the going concern basis.
- 21 -
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AFRICA MOBILE NETWORKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
2.Accounting policies (continued)
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Foreign currency translation
|
Functional and presentation currency
The functional and presentational currency of the Parent company has historically been British Pound whilst the operational and functional currency of the Group has been US Dollars. Most of the subsidiaries now have a functional and reporting currency other than British Pounds which supports the change in presentational currency which is now US Dollars.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.
At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.
Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges.
Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Consolidated Statement of Comprehensive Income within 'finance income or costs'. All other foreign exchange gains and losses are presented in profit or loss within 'other operating income'.
On consolidation, the results of overseas operations are translated into Dollars at rates approximating to those ruling when the transactions took place. All assets and liabilities of overseas operations are translated at the rate ruling at the reporting date. Exchange differences arising on translating the opening net assets at opening rate and the results of overseas operations at actual rate are recognised in other comprehensive income.
- 22 -
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|
AFRICA MOBILE NETWORKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
2.Accounting policies (continued)
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:
Sale of goods
Revenue from the sale of goods is recognised when all of the following conditions are satisfied:
∙the Group has transferred the significant risks and rewards of ownership to the buyer;
∙the Group retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
∙the amount of revenue can be measured reliably;
∙it is probable that the Group will receive the consideration due under the transaction; and
∙the costs incurred or to be incurred in respect of the transaction can be measured reliably.
Rendering of services
Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
∙the amount of revenue can be measured reliably;
∙it is probable that the Group will receive the consideration due under the contract;
∙the stage of completion of the contract at the end of the reporting period can be measured reliably; and
∙the costs incurred and the costs to complete the contract can be measured reliably.
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|
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Operating leases: the Group as lessee
|
Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.
In the research phase of an internal project it is not possible to demonstrate that the project will generate future economic benefits and hence all expenditure on research shall be recognised as an expense when it is incurred. Intangible assets are recognised from the development phase of a project if and only if certain specific criteria are met in order to demonstrate the asset will generate probable future economic benefits and that its cost can be reliably measured. The capitalised development costs are subsequently amortised on a straight line basis over their useful economic lives, which range from 3 to 6 years.
If it is not possible to distinguish between the research phase and the development phase of an internal project, the expenditure is treated as if it were all incurred in the research phase only.
- 23 -
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|
AFRICA MOBILE NETWORKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
2.Accounting policies (continued)
Interest income is recognised in profit or loss using the effective interest method.
Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.
All borrowing costs are recognised in profit or loss in the year in which they are incurred.
Defined contribution pension plan
The Group operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity. Once the contributions have been paid the Group has no further payment obligations.
The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of Financial Position. The assets of the plan are held separately from the Group in independently administered funds.
Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the Company and the Group operate and generate income.
- 24 -
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|
AFRICA MOBILE NETWORKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
2.Accounting policies (continued)
Goodwill
Goodwill represents the difference between amounts paid on the cost of a business combination and the acquirer’s interest in the fair value of the Group's share of its identifiable assets and liabilities of the acquiree at the date of acquisition. Subsequent to initial recognition, goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is amortised on a straight-line basis to the Consolidated Statement of Comprehensive Income over its useful economic life.
Other intangible assets
Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.
All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.
Amortisation is provided on the following bases:
Other intangible assets are amortised on a straight-line basis to the Consolidated Statement of Comprehensive Income over their useful economic life.
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.
- 25 -
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|
AFRICA MOBILE NETWORKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
2.Accounting policies (continued)
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|
|
Tangible fixed assets (continued)
|
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following basis:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
Investments in subsidiaries are measured at cost less accumulated impairment.
Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis.
At each balance sheet date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in the statement of comprehensive income.
Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.
|
|
|
Cash and cash equivalents
|
Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.
In the Consolidated Statement of Cash Flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Group's cash management.
- 26 -
|
|
AFRICA MOBILE NETWORKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
2.Accounting policies (continued)
Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.
The Group only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.
Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or in case of an out-right short-term loan that is not at market rate, the financial asset or liability is measured, initially at the present value of future cash flows discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost, unless it qualifies as a loan from a director in the case of a small company, or a public benefit entity concessionary loan.
Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Consolidated Statement of Comprehensive Income.
For financial assets measured at amortised cost, the impairment loss is measured as the difference between an asset's carrying amount and the present value of estimated cash flows discounted at the asset's original effective interest rate. If a financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract.
For financial assets measured at cost less impairment, the impairment loss is measured as the difference between an asset's carrying amount and best estimate of the recoverable amount, which is an approximation of the amount that the Group would receive for the asset if it were to be sold at the reporting date.
- 27 -
|
|
AFRICA MOBILE NETWORKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
|
|
Judgements in applying accounting policies and key sources of estimation uncertainty
|
In applying the aforementioned accounting policies, the Directors are required to make judgements, estimates and assumptions to determine the carrying amounts of assets and liabilities. The judgements, estimates and assumptions are made using the most recent and reliable information available at the time of the decisions, although actual outcomes may differ given the subjectivity involved in making such decisions.
Determining residual values and useful economic lives of intangible and tangible assets
The company depreciate tangible assets over their estimated useful lives. The estimation of the useful lives of assets is based on historic performance as well as expectations about future use and therefore requires estimates and assumptions to be applied by management. The actual lives of these assets can vary depending on a variety of factors, including technological innovation, product life cycles and maintenance programmes.
Recoverability of debtors
Debtors are all deemed recoverable. On intercompany balances there are deemed recoverable and represent the funding provided to each operating company to build Towers and support the growth of operations and it is anticipated that as the individual businesses start to general surplus profits over time that these balances will be repaid.
The whole of the turnover is attributable to the prinicpal activity of the Group.
|
|
All turnover arose within the rest of the world.
|
|
|
The other operating income relates to the release of money disbursed under a long term loan agreement which was cancelled on April 1st, 2022 by the Lender without the requirement to repay any of the outstanding debt.
|
- 28 -
|
|
AFRICA MOBILE NETWORKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
|
|
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|
|
The operating loss is stated after charging/(crediting):
|
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|
Research & development charged as an expense
|
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|
Provision for doubtful debts
|
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|
Other operating lease rentals
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Fees payable to the Group's auditor and its associates for the audit of the Group's annual financial statements
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Cost of defined contribution pension scheme
|
|
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|
|
The average monthly number of employees, including the Directors, during the year was as follows:
|
- 29 -
|
|
AFRICA MOBILE NETWORKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
|
|
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|
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|
|
Company contributions to defined contribution pension schemes
|
|
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|
|
The highest paid Director received remuneration of $511k (2021 - $596k).
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|
|
The value of the Group's contributions paid to a defined contribution pension scheme in respect of the highest paid Director amounted to $9k (2021 - $10k).
|
|
|
Other interest receivable
|
|
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|
|
Interest payable and similar expenses
|
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|
Interest payable (PIK) on convertible loan notes
|
|
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|
- 30 -
|
|
AFRICA MOBILE NETWORKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
|
|
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|
|
UK Current tax on profits for the year
|
|
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|
|
Adjustments in respect of previous periods
|
|
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|
|
Foreign tax on income for the year
|
|
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|
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|
|
|
|
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|
|
Factors affecting tax charge for the year
|
|
|
The tax assessed for the year is higher than (2021 - higher than) the standard rate of corporation tax in the UK of 19% (2021 - 19%). The differences are explained below:
|
|
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Loss on ordinary activities before tax
|
|
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|
|
Loss on ordinary activities multiplied by standard rate of corporation tax in the UK of 19% (2021 - 19%)
|
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Adjustment in research and development tax credit leading to an increase (decrease) in the tax charge
|
|
|
|
|
Differences in relation to foreign tax
|
|
|
|
|
|
|
|
|
|
Total tax charge for the year
|
|
|
- 31 -
|
|
AFRICA MOBILE NETWORKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
12.Taxation (continued)
|
|
Factors that may affect future tax charges
|
The UK Government announced in the 2021 budget that from 1 April 2023, the rate of corporation tax in the United Kingdom will increase from 19% to 25%. Companies with profits of £50k or less will continue to be taxed at 19%, which is a new small profits rate. Where taxable profits are between £50k and £250k, the higher 25% rate will apply but with a marginal relief applying as profits increase.
|
|
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|
|
At 1 January 2022 (as previously stated)
|
|
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|
At 1 January 2022 (as restated)
|
|
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|
|
At 1 January 2022 (as previously stated)
|
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At 1 January 2022 (as restated)
|
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|
|
At 31 December 2021 (as restated)
|
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|
|
- 32 -
|
|
AFRICA MOBILE NETWORKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
13.Intangible assets (continued)
|
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At 1 January 2022 (as previously stated)
|
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|
At 1 January 2022 (as restated)
|
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|
At 31 December 2021 (as restated)
|
|
- 33 -
|
|
AFRICA MOBILE NETWORKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
|
|
Office and computer equipment
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
|
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|
|
|
At 1 January 2022 (as previously stated)
|
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|
|
At 1 January 2022 (as restated)
|
|
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|
|
Transfers between classes
|
|
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|
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|
|
At 1 January 2022 (as previously stated)
|
|
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|
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|
|
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|
|
At 1 January 2022 (as restated)
|
|
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|
|
At 31 December 2021 (as restated)
|
|
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|
|
|
- 34 -
|
|
AFRICA MOBILE NETWORKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
14.Tangible fixed assets (continued)
|
|
Office and computer equipment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At 1 January 2022 (as previously stated)
|
|
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|
|
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|
At 1 January 2022 (as restated)
|
|
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|
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At 1 January 2022 (as previously stated)
|
|
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|
At 1 January 2022 (as restated)
|
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|
At 31 December 2021 (as restated)
|
|
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|
|
- 35 -
|
|
AFRICA MOBILE NETWORKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
|
|
Investments in subsidiary companies
|
|
|
|
|
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|
|
At 1 January 2022 (as previously stated)
|
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|
|
|
At 1 January 2022 (as restated)
|
|
|
|
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|
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|
|
During the year, two non-trading entities, Africa Mobile Networks Rwanda and Africa Mobile Networks Panama were incorporated for a total consideration of $9.7k and $10k respectively.
|
|
|
|
|
|
The following were subsidiary undertakings of the Company:
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Africa Mobile Networks Cameroon SARLU
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Rue Hydrocarbure, BP 12153, Douala, Cameroon
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Africa Mobile Networks Benin SARL
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148F Quartier Sodjeatinme, Cotonou, Benin
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Africa Mobile Networks Cote D'Ivoire SARL
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Abidjan, Cocody Ambassades, Rue Bya, Vila Economie, 03BP670 CIDEX03 Abidjan
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Africa Mobile Networks DRC SARLU
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4 Avenue De La Mongala, C/Gombe, Kinshasa
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Africa Mobile Networks Communication Ltd
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The Regent Place, Plot MF15, Murtala Mohammed Expressway, Kubwa - Abuja, FCT, Nigeria
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Africa Mobile Networks Guinee SARLU
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Manquepas, Commune de Kaloum, Conakry (Guinee)
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Africa Mobile Networks Zambia Limited
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28A State Lodge Road, State Lodge, Lusaka PO Box 38456
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Africa Mobile Networks Liberia Inc.
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Montserrado, Congo Town, Tubman Boulevard, Adj French Embassy
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Africa Mobile Networks Services Co. Ltd
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Khartoum Bahri Shambat Block 12, Home no 17, Sudan
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Africa Mobile Networks GB SARL
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Bairro Badim Zona 7, Zona Padaira Nhonho, GUINE-BISSAU
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- 36 -
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AFRICA MOBILE NETWORKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
Subsidiary undertakings (continued)
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Africa Mobile Networks (SS) Limited
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Hai Hahata Juna Central Equatoria, South Sudan
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Africa Mobile Networks Congo SARLU
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480 Av Bitelika Ndombi, Immeuble Business Center, Tchimbamba Pointe Noire
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Africa Mobile Network Ghana Limited
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House No 4, Naa Adjeley Sowah Street, La Nkwantanang, Madina-Accra
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2040 Martin Avenue, Santa Clara, CA 95050, USA
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Africa Mobile Networks Rwanda
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Africa Mobile Networks Panama
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Bella Vista Calle 51 Este y Ave. Manuel María Izcaza, Department 613,Panama City, Province of Panama, Panama
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Africa Mobile Networks Madagascar SARLU
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Notaire en Résidence à Miarinarivo, Lot XI A 10 Antanambao-Nord, Madagascar
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Amounts owed by group undertakings
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Prepayments and accrued income
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Amounts owed by group undertakings are interest free, unsecured and repayable on demand.
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- 37 -
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AFRICA MOBILE NETWORKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
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Cash and cash equivalents
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Creditors: Amounts falling due within one year
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Payments received on account
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Amounts owed to group undertakings
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Other taxation and social security
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Accruals and deferred income
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Amounts owed to group undertakings are interest free, unsecured and repayable on demand.
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Creditors: Amounts falling due after more than one year
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A convertible loan note of $16m was issued in March 2019 which had a four-year term with payment in kind interest of 10% per annum. The facility was due to mature in March 2023. In April 2022 it was agreed and a commitment was made to convert $10m of this facility to equity. The conversion and repayment of the rest of the facility was concluded in December 2022.
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- 38 -
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AFRICA MOBILE NETWORKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
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Amounts falling due within one year
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Amounts falling due 1-2 years
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A convertible loan note of $16m was issued in March 2019 which had a four-year term with payment in kind interest of 10% per annum. The facility was due to mature in March 2023. In April 2022 it was agreed and a commitment was made to convert $10m of this facility to equity. The conversion and repayment of the rest of the facility was concluded in December 2022.
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- 39 -
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AFRICA MOBILE NETWORKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
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Allotted, called up and fully paid
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5,013,926 (2021 - 5,013,926) A Ordinary shares of £0.001 each
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7,271,981 (2021 - 6,434,250) C Ordinary shares of £0.001 each
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On 7th December 2022, the company issued 837,731 Class C Ordinary Shares for a total consideration of $10m. The shares were issued in order to part repay the convertible loan as per Note 19.
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The Company has two classes of ordinary shares which carry voting rights but no right to fixed income.
Share premium account
The share premium account reserve represents the excess of the issue price over the par value on shares that were issued less any transaction costs arising with the issue of the shares.
Other reserves
These amounts represents funding and investment received by the business in 2016 and 2017 without the issue of Ordinary shares that was used to build Towers in Africa.
Profit and loss account
The profit and loss account reserve represents the cumulative profits and losses of the Company, less the payment of any dividends
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Prior year adjustment - Group
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During the year there was an adjustment to correct the foreign exchange effect of translating balances into the correct functional currency (being the $). The effect of the restatement has been to decrease reserves as at 1 January 2021 by $1,061k and increase loss for the year as at 31 December 2021 by $1,322k. Associated increases/decreases have been applied across the balance sheet.
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Prior year adjustment - Company only
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During the year there was an adjustment to correct the foreign exchange effect of translating balances into the correct functional currency (being the $). The effect of the restatement has been to decrease reserves as at 1 January 2021 by $2,005k and increase loss for the year as at 31 December 2021 by $1,328k. Associated increases/decreases have been applied across the balance sheet.
- 40 -
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AFRICA MOBILE NETWORKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
The Group made contributions to a defined contribution personal pension plan in the year. The assets of this plan are separate from those of the Group. The pension cost charge for these represents contributions payable by the Group and amounted to $80k (2021: $66k). Contributions totalling $Nil (2021: $NIL) were payable at the balance sheet date.
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Commitments under operating leases
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At 31 December 2022 the Group and the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:
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Later than 1 year and not later than 5 years
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Related party transactions
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The Company has taken advantage of the exemption not to disclose related party transactions in respect to all transactions and balances with wholly owned subsidiaries, as they are eliminated on consolidation, as permitted under Paragraph 1.12 of FRS 102.
The company had transactions with Intelsat, a company of which J-P Gillet is also a director, amounting to $4,739k (2021: $2,774k), with amounts owed at the balance sheet date of $1,790k (2021: $1,623k).
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Post balance sheet events
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On March 24th 2023, a first disbursement of $10m was received having satisfied all of the Condition Precedents and achieving Financial close on the Debt funding facility with Finnfund and Blue Orchard.
A further $5m drawdown relating to the second disbursement was received during September 2023.
A fixed and floating charge over all property and undertaking of the Company exists in respect of this facility.
The Directors consider that there is no controlling party.
- 41 -
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