Company registration number 12822763 (England and Wales)
PAY PERFORM HOLDINGS LTD
ANNUAL REPORT AND CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 NOVEMBER 2023
30 November 2023
PAY PERFORM HOLDINGS LTD
COMPANY INFORMATION
Directors
Christopher Mason
Paulius Grigaitis
Luke Wingfield Digby
Company number
12822763
Registered office
1-2 Silex Street
London
England
SE1 0DW
Auditor
Royce Peeling Green Limited
The Copper Room
Deva City Office Park
Trinity Way
Manchester
M3 7BG
PAY PERFORM HOLDINGS LTD
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
Independent auditor's report
5 - 7
Group statement of comprehensive income
8
Group and company balance sheets
9
Group statement of changes in equity
10
Company statement of changes in equity
11
Group statement of cash flows
12
Notes to the financial statements
13 - 26
PAY PERFORM HOLDINGS LTD
STRATEGIC REPORT
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 1 -

The directors present the strategic report for the year ended 30 November 2023.

Principal activities

The Orbital Group is a fintech group which offers services combining traditional financial services, such as payments and currency exchange, with virtual currency services. These services are provided by the respective Group companies holding the required licenses. The Group has built a proprietary suite of payment processing capabilities across the globe to offer a digital first treasury solution for corporate clients that allow it to process payments in supported currencies.

The services appeal particularly to companies that have a global payments requirement, with the need for sophisticated account functionality, multi-currency accounts, and fully programmatic API based services allowing for automation and easy reconciliation. The Orbital Group has already built the platform and has been successfully serving its current customers and growing business.

The principal activity of the company is that of a holding company.

Business Performance and Key Performance Indicators

Agreed Investment through advanced subscription agreements (ASAs) of £5,030,435 occurred in 2023, of which £4,639,015 was paid in cash during the accounting period, improving the balance sheet position for FY23 and cash in hand.

The Group ended the year with cash and inventories denominated in cryptocurrency of £50,549,495 compared with £15,248,371 at the end of FY22, including client held funds which increased to £43,949,681 from £14,426,739 from the end of FY22 to end of FY23.

Revenue increased from £8,597,182 in FY22 to £11,374,591 in FY23; an increase of 32%

In FY22 the Group recorded a Net Loss of £1,133,268 but in FY23 it recorded a Net Profit of £579,132, therefore generating a positive swing in profitability year on year.

Two new Licences in Gibraltar for EMI and DLT services were acquired during the FY23 adding two additional operating and revenue generating entities to the Group.

Future Developments

Regulatory: The focus for the coming financial year is to continue to solidify the Group’s licencing position to meet the needs of its current and future clients by fully adapting to global regulatory landscapes by obtaining new licenses in additional jurisdictions.

Commercial: From a commercial perspective the Group intends to drive growth by deepening relationships with existing clients through expanded service offerings and by targeting new client segments in FY24.

Product and Technology: As a Technology based business entrusted with client data the firm is committed to achieving SOC 2 certification, a highly respected compliance framework that reinforces data security and requires a rigorous independent audit.

 

PAY PERFORM HOLDINGS LTD
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 2 -
Principal Risks and Uncertainties

Regulatory Risk: The cryptocurrency regulatory landscape is evolving, with new frameworks expected soon in key jurisdictions. The EU’s Markets in Crypto-Assets (MiCA) regulation, effective by end of 2024, will enforce standards for crypto-asset service providers (CASPs) on customer protection, capital requirements and market integrity. New MiCA licenses will need to be obtained by CASPs after proving compliance with rigorous requirements. Non-compliance could lead to penalties, higher operational costs or failure to obtain the license.

Economic Conditions: Global economic factors, including inflation, interest rates, and downturns, impact consumer behaviour and cryptocurrency adoption. Market volatility, particularly in cryptocurrencies, poses financial risks, especially in unstable economic periods.

Vendor Relationships and Third-Party Dependence: Our reliance on key third-party vendors, such as blockchain providers and KYC/AML service providers, poses risks if there are disruptions or performance issues. We have formalized onboarding and review processes to manage vendors effectively and ensure continuity.

Cybersecurity: As a prime cybercrime target, any system breach could lead to client fund losses, data compromise, and reputational harm. To mitigate this, we have adopted strict cybersecurity measures that meet the internationally recognized security standards and conduct regular vulnerability assessments and audits.

Data Security and GDPR Compliance: Handling sensitive customer data across jurisdictions brings legal risks. GDPR compliance in the EU is essential, and non-compliance or breaches could result in fines and reputational damage.

Fraud and Financial Crime: Cross-border transactions and cryptocurrency related risks increase our exposure to fraud and financial crime. Despite robust anti-crime measures, potential misuse by criminal networks could lead to financial losses, harmed reputation, regulatory scrutiny or fines. We continued to strengthen our compliance framework and transaction monitoring by adding new vendor tools to enhance fraud and crime detection.

 

On behalf of the board

Christopher Mason
Director
14 November 2024
PAY PERFORM HOLDINGS LTD
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 3 -

The directors present their annual report and consolidated financial statements for the year ended 30 November 2023.

Results and dividends

The results for the year are set out on page 8.

No ordinary dividends were paid. The directors do not recommend payment of a further dividend.

Directors

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

Christopher Mason
Paulius Grigaitis
Arun Swaminathan
(Resigned 8 June 2023)
Luke Wingfield Digby
Directors' insurance

The company has made qualifying third party indemnity provisions for the benefit of its directors during the year. These provisions remain in force at the reporting date.

Auditor

The auditor, Royce Peeling Green Limited, is deemed to be reappointed under section 487(2) of the Companies Act 2006.

Statement of directors' responsibilities

The directors are responsible for preparing the Annual Report and the 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 United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). 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 group and company, and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:

 

 

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the auditor of the company is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the auditor of the company is aware of that information.

PAY PERFORM HOLDINGS LTD
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 4 -
Other matters

In accordance with Companies Act 2006, s.414C(11) the group has chosen to set out in the Strategic Report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the Directors' Report. It has done so in respect of principal risks and uncertainties, financial instruments and future developments.

Medium-sized companies exemption

This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.

On behalf of the board
Christopher Mason
Director
14 November 2024
PAY PERFORM HOLDINGS LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF PAY PERFORM HOLDINGS LTD
- 5 -
Opinion

We have audited the financial statements of Pay Perform Holdings Ltd (the 'parent company') and its subsidiaries (the 'group') for the year ended 30 November 2023 which comprise the group statement of comprehensive income, the group balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 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:

 

The prior year results and balance sheet are unaudited and accordingly, we express no opinion thereon.

Basis for opinion

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 and 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 and 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. 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.

 

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of our audit:

PAY PERFORM HOLDINGS LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF PAY PERFORM HOLDINGS LTD
- 6 -
Matters on which we are required to report by exception

In the 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.

 

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:

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, 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 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 either intend to liquidate 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.

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. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

We evaluated the directors' and management's incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls) and determined that the principal risks were related to posting manual journal entries to manipulate financial performance, management bias through judgements and assumptions in significant accounting estimates and significant one-off or unusual transactions.

 

Our audit procedures were designed to respond to those identified risks, including non-compliance with laws and regulations (irregularities) and fraud that are material to the financial statements. Our audit procedures included but were not limited to:

 

PAY PERFORM HOLDINGS LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF PAY PERFORM HOLDINGS LTD
- 7 -

Our audit procedures in relation to fraud included but were not limited to:

 

 

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 is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

Use of our report

This report is made solely to the 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 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 company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

Martin Chatten
Senior Statutory Auditor
For and on behalf of
14 November 2024
Royce Peeling Green Limited
Chartered Accountants
Statutory Auditor
The Copper Room
Deva City Office Park
Trinity Way
Manchester
M3 7BG
PAY PERFORM HOLDINGS LTD
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 8 -
2023
2022
Unaudited
Notes
£
£
Turnover
3
11,374,591
8,597,182
Cost of sales
(1,257,501)
(1,252,582)
Gross profit
10,117,090
7,344,600
Administrative expenses
(9,471,138)
(8,501,045)
Operating profit/(loss)
4
645,952
(1,156,445)
Interest payable and similar expenses
9
(24,845)
(3,952)
Profit/(loss) before taxation
621,107
(1,160,397)
Tax on profit/(loss)
10
(41,975)
27,129
Profit/(loss) for the financial year
20
579,132
(1,133,268)
Profit/(loss) for the financial year is all attributable to the owners of the parent company.
Total comprehensive income for the year is all attributable to the owners of the parent company.
PAY PERFORM HOLDINGS LTD
GROUP AND COMPANY BALANCE SHEETS
AS AT 30 NOVEMBER 2023
30 November 2023
- 9 -
Group
Company
2023
2022
Unaudited
2023
2022
Unaudited
Notes
£
£
£
£
Fixed assets
Tangible assets
11
54,865
5,253
-
0
-
0
Investments
12
-
0
-
0
103,185
103,185
54,865
5,253
103,185
103,185
Current assets
Stocks
14
14,425,850
6,437,121
-
-
Debtors
15
470,292
221,831
100
100
Cash at bank and in hand
36,123,645
8,811,250
-
0
-
0
51,019,787
15,470,202
100
100
Creditors: amounts falling due within one year
16
(45,446,132)
(15,144,849)
(100)
(100)
Net current assets
5,573,655
325,353
-
-
Total assets less current liabilities
5,628,520
330,606
103,185
103,185
Provisions for liabilities
Deferred tax liability
17
6,250
24,818
-
0
-
0
Net assets
5,634,770
355,424
103,185
103,185
Capital and reserves
Called up share capital
19
100
100
100
100
Share premium account
20
103,085
103,085
103,085
103,085
Equity reserve
20
105,653
44,454
-
0
-
0
Other reserves
20
4,639,015
-
0
-
0
-
0
Profit and loss reserves
20
786,917
207,785
-
0
-
Total equity
5,634,770
355,424
103,185
103,185

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £0 (2022 - £0 profit).

The financial statements were approved by the board of directors and authorised for issue on 14 November 2024 and are signed on its behalf by:
14 November 2024
Christopher Mason
Director
Company registration number 12822763 (England and Wales)
PAY PERFORM HOLDINGS LTD
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 10 -
Share capital
Share premium account
Equity reserve
Shares to be issued
Profit and loss reserves
Total
£
£
£
£
£
£
Balance at 1 December 2021 (Unaudited)
100
103,085
14,488
-
1,341,053
1,458,726
Year Ended 30 November 2022 (Unaudited):
Loss and total comprehensive income
-
-
-
-
(1,133,268)
(1,133,268)
Other movements
-
-
29,966
-
-
29,966
Balance at 30 November 2022 (Unaudited)
100
103,085
44,454
-
207,785
355,424
Year ended 30 November 2023:
Profit and total comprehensive income
-
-
-
-
579,132
579,132
Other movements
-
-
61,199
4,639,015
-
4,700,214
Balance at 30 November 2023
100
103,085
105,653
4,639,015
786,917
5,634,770
PAY PERFORM HOLDINGS LTD
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 11 -
Share capital
Share premium account
Total
£
£
£
Balance at 1 December 2021 (Unaudited)
100
103,085
103,185
Year ended 30 November 2022 (Unaudited)
Profit and total comprehensive income for the year
-
-
-
0
Balance at 30 November 2022 (Unaudited)
100
103,085
103,185
Year ended 30 November 2023:
Profit and total comprehensive income
-
-
-
0
Balance at 30 November 2023
100
103,085
103,185
PAY PERFORM HOLDINGS LTD
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 12 -
2023
2022
Unaudited
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
25
23,079,450
5,180,071
Interest paid
(24,845)
(3,952)
Income taxes (paid)/refunded
(101,215)
53,202
Net cash inflow from operating activities
22,953,390
5,229,321
Investing activities
Purchase of tangible fixed assets
(70,010)
(11,163)
Repayment of loans
-
2,575
Net cash used in investing activities
(70,010)
(8,588)
Financing activities
New/ (repayment of) borrowings
(210,000)
210,000
Proceeds from ASA Holders
4,639,015
-
Net cash generated from financing activities
4,429,015
210,000
Net increase in cash and cash equivalents
27,312,395
5,430,733
Cash and cash equivalents at beginning of year
8,811,250
3,380,517
Cash and cash equivalents at end of year
36,123,645
8,811,250
PAY PERFORM HOLDINGS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 13 -
1
Accounting policies
Company information

Pay Perform Holdings Ltd (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is 1-2 Silex Street, London, England, SE1 0DW.

 

The group consists of Pay Perform Holdings Ltd and all of its subsidiaries.

1.1
Accounting convention

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

1.2
Business combinations

In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill.

1.3
Basis of consolidation

The consolidated group financial statements consist of the financial statements of the parent company Pay Perform Holdings Ltd together with all entities controlled by the parent company.

 

All financial statements are made up to 30 November 2023. All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation.

Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.

1.4
Going concern

At the time of approving the financial statements, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

1.5
Turnover

Fees receivable are derived from fees and commissions charged on the principal activity of provision of IT solutions enabling global businesses to trade, transfer and store traditional and crypto currencies. These fees are charged and drawn down in real time when the transaction event occurs.

1.6
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Fixtures and fittings
25% Straight Line
Computers
1 Year Straight Line
PAY PERFORM HOLDINGS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
1
Accounting policies
(Continued)
- 14 -

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the profit and loss account.

1.7
Fixed asset investments

Interests in subsidiaries, are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.

A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

1.8
Impairment of fixed assets

At each reporting period end date, the group reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

1.9
Stocks

The accounting policies for cryptocurrencies have been developed by analogy to the requirements and guidance in similar and related IFRSs to the extent that they provide a fair review of an entity's financial position, financial performance and cash flows and enable consumers to make informed decisions.

 

In 2023, the group accounted for virtual currencies held by the group as assets on the basis of the fair value of the virtual currency at the reporting date using the closing price on the https://coinmarketcap.com/ platform and the official US dollar exchange rate of the European Central Bank on the balance sheet date at fair value.

 

The group records cryptocurrencies in inventory at fair value as cryptocurrencies are typically used in the purchase and sale of commodities. Gains and losses arising from changes in value are included in other financial income and expenses in the statement of comprehensive income.

 

Virtual currencies payable to customers are accounted for in the same way as corporate-owned currencies. Liabilities to customers are included in the balance sheet under payables. These liabilities are revalued at each reporting date to the closing market price and the gain (loss) on revaluation is included in other financial income and expenses.

 

Client assets include both traditional currencies (EUR, USD, etc.) and cryptocurrencies.

1.10
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

1.11
Financial instruments

The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

 

Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.

 

Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

PAY PERFORM HOLDINGS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
1
Accounting policies
(Continued)
- 15 -
Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Classification of financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities.

Basic financial liabilities

Basic financial liabilities are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

 

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

 

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

1.12
Equity instruments

Equity instruments issued by the group are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the group.

1.13
Taxation

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

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

PAY PERFORM HOLDINGS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
1
Accounting policies
(Continued)
- 16 -
Deferred tax

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

 

The carrying amount of deferred tax assets is reviewed at each reporting end 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. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

1.14
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets. The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received. Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

1.15
Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

1.16
Share-based payments

Equity-settled share-based payments are measured at fair value at the date of grant. The fair value determined at the grant date is expensed on a straight-line basis over the vesting period, based on the estimate of shares that will eventually vest. A corresponding adjustment is made to equity.

1.17
Leases

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease.

1.18
Foreign exchange

Monetary assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate ruling on the date of the transaction. Exchange differences are taken into account in arriving at the operating profit.

1.19

Liability limitation agreement

The group has entered into a liability limitation agreement with Royce Peeling Green Limited, the statutory auditor for the year ended 30 November 2023. The proportionate liability agreement follows the standard terms in Appendix B to the FRC's June 2008 Guidance on Auditor Liability Agreements, and has been approved by the shareholders.

PAY PERFORM HOLDINGS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 17 -
2
Judgements and key sources of estimation uncertainty

In the application of the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

3
Turnover
2023
2022
Unaudited
£
£
Turnover analysed by class of business
Payment processing
11,374,591
8,597,182
2023
2022
Unaudited
£
£
Turnover analysed by geographical market
Europe
5,303,514
4,042,261
Rest of the World
6,071,077
4,554,921
11,374,591
8,597,182
4
Operating profit/(loss)
2023
2022
Unaudited
£
£
Operating profit/(loss) for the year is stated after charging/(crediting):
Exchange (gains)/losses
(179,365)
45,232
Depreciation of owned tangible fixed assets
20,398
15,154
Share-based payments
61,199
29,966
Operating lease charges
302,876
320,100
5
Auditor's remuneration
2023
2022
Unaudited
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
15,000
-
Audit of the financial statements of the company's subsidiaries
61,340
44,970
76,340
44,970
PAY PERFORM HOLDINGS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
5
Auditor's remuneration
(Continued)
- 18 -

There was no company/ group audit fee in the prior period as group results were unaudited, however certain subsidiaries required an audit for regulatory reasons.

6
Employees

The average monthly number of persons (including directors) employed by the group and company during the year was:

Group
Company
2023
2022
2023
2022
Unaudited
Unaudited
Number
Number
Number
Number
Compliance
5
4
-
-
Data & Finance
5
6
-
-
Executive
4
4
-
-
Partnerships & Operations
9
22
-
-
Product and Technology
21
19
-
-
People
3
2
-
-
Revenue Management
8
5
-
-
IT & Security
2
1
-
-
57
63
-
-

Their aggregate remuneration comprised:

Group
Company
2023
2022
2023
2022
Unaudited
Unaudited
£
£
£
£
Wages and salaries
4,783,821
2,685,510
-
0
-
0
Social security costs
476,588
334,046
-
-
Pension costs
39,340
32,745
-
0
-
0
5,299,749
3,052,301
-
0
-
0
7
Retirement benefit schemes
2023
2022
Unaudited
£
£
Charge to profit or loss in respect of defined contribution schemes
39,340
32,745

A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.

PAY PERFORM HOLDINGS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 19 -
8
Directors' remuneration
2023
2022
Unaudited
£
£
Remuneration for qualifying services
761,222
504,212
Company pension contributions to defined contribution schemes
1,577
1,211
573,198
505,423
Remuneration disclosed above includes the following amounts paid to the highest paid director:
2023
2022
Unaudited
£
£
Remuneration for qualifying services
343,508
180,000
9
Interest payable and similar expenses
2023
2022
Unaudited
£
£
Interest on financial liabilities measured at amortised cost:
Other interest on financial liabilities
21,944
3,952
Other finance costs:
Other interest
2,901
-
Total finance costs
24,845
3,952
10
Taxation
2023
2022
Unaudited
£
£
Current tax
UK corporation tax on profits for the current period
23,407
-
0
Deferred tax
Origination and reversal of timing differences
18,568
(20,618)
Changes in tax rates
-
0
(6,511)
Total deferred tax
18,568
(27,129)
Total tax charge/(credit)
41,975
(27,129)
PAY PERFORM HOLDINGS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
10
Taxation
(Continued)
- 20 -

The actual charge/(credit) for the year can be reconciled to the expected charge/(credit) for the year based on the profit or loss and the standard rate of tax as follows:

2023
2022
Unaudited
£
£
Profit/(loss) before taxation
621,107
(1,160,397)
Expected tax charge/(credit) based on the standard rate of corporation tax in the UK of 23.01% (2022: 19.00%)
142,917
(220,475)
Tax effect of expenses that are not deductible in determining taxable profit
71,586
17,613
Tax effect of utilisation of tax losses not previously recognised
(112,499)
-
0
Unutilised tax losses carried forward
31,665
272,966
Effect of change in corporation tax rate
-
(6,511)
Effect of overseas tax rates
(94,317)
(78,729)
Other items
2,623
(11,993)
Taxation charge/(credit)
41,975
(27,129)

Profits generated in Estonia are only subject to tax on distributions. Due to capital maintenance requirement relevant to the subsidiary there is no prospect of distributions in the near future and hence no tax charge has been raised.

11
Tangible fixed assets
Group
Fixtures and fittings
Computers
Total
£
£
£
Cost
At 1 December 2022 (Unaudited)
1,443
65,713
67,156
Additions
-
0
70,010
70,010
At 30 November 2023
1,443
135,723
137,166
Depreciation and impairment
At 1 December 2022 (Unaudited)
1,002
60,901
61,903
Depreciation charged in the year
441
19,957
20,398
At 30 November 2023
1,443
80,858
82,301
Carrying amount
At 30 November 2023
-
0
54,865
54,865
At 30 November 2022 (Unaudited)
441
4,812
5,253
The company had no tangible fixed assets at 30 November 2023 or 30 November 2022.
PAY PERFORM HOLDINGS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 21 -
12
Fixed asset investments
Group
Company
2023
2022
2023
2022
Unaudited
Unaudited
Notes
£
£
£
£
Investments in subsidiaries
13
-
0
-
0
103,185
103,185
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 1 December 2022 (Unaudited) and 30 November 2023
103,185
Carrying amount
At 30 November 2023
103,185
At 30 November 2022 (Unaudited)
103,185
13
Subsidiaries

Details of the company's subsidiaries at 30 November 2023 are as follows:

Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Indirect
Pay Perform Management Limited
England & Wales
Ordinary
100.00
-
Pay Perform Limited
England & Wales
Ordinary
-
100.00
Pay Perform OU
Estonia
Ordinary
-
100.00
Pay Perform Technologies Limited
Gibraltar
Ordinary
-
100.00
Pay Perform (Gibraltar) Limited
Gibraltar
Ordinary
-
100.00
Pay Perform Digital Limited
Gibraltar
Ordinary
-
100.00
Pay Perform India Private Limited
India
Ordinary
-
100.00
Pay Perform LT
Lithuania
Ordinary
-
100.00
14
Stocks
Group
Company
2023
2022
2023
2022
£
£
£
£
Operational cryptocurrency
359,478
61,762
-
-
Client cryptocurrency
14,066,372
6,375,359
-
0
-
0
14,425,850
6,437,121
-
-

Various virtual currencies are reflected under inventories. Clients' virtual currencies are stored and accounted for separately.

PAY PERFORM HOLDINGS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 22 -
15
Debtors
Group
Company
2023
2022
2023
2022
Unaudited
Unaudited
Amounts falling due within one year:
£
£
£
£
Trade debtors
-
0
35,630
-
0
-
0
Other debtors
173,961
97,595
100
100
Prepayments and accrued income
296,331
88,606
-
0
-
0
470,292
221,831
100
100
16
Creditors: amounts falling due within one year
Group
Company
2023
2022
2023
2022
Unaudited
Unaudited
Notes
£
£
£
£
Other borrowings
23
-
0
210,000
-
0
-
0
Trade creditors
43,949,681
14,426,739
-
0
-
0
Corporation tax payable
23,407
101,215
-
0
-
0
Other taxation and social security
148,382
115,199
-
-
Other creditors
49,826
26,928
100
100
Accruals and deferred income
1,274,836
264,768
-
0
-
0
45,446,132
15,144,849
100
100
17
Deferred taxation

The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:

Liabilities
Liabilities
2023
2022
Unaudited
Group
£
£
Accelerated capital allowances
-
1,200
Tax losses
-
(19,768)
Other short term timing differences
(6,250)
(6,250)
(6,250)
(24,818)
The company has no deferred tax assets or liabilities.
PAY PERFORM HOLDINGS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
17
Deferred taxation
(Continued)
- 23 -
Group
Company
2023
2023
Movements in the year:
£
£
Asset at 1 December 2022 (Unaudited)
(24,818)
-
Charge to profit or loss
18,568
-
Asset at 30 November 2023
(6,250)
-
18
Share-based payment transactions

The subsidiary undertaking, Pay Perform Management Limited operates an unapproved employee share option plan (ESOP).

 

Share options will vest in line with a contract and are not physically awarded. Share options will be earned over 4 years on a straight line basis with a 2 year 'cliff'. A 'cliff' is the minimum period employees must work before receiving any benefit. Share options can be exercised when there is a significant event such as a partial sale, full sale or IPO. Each option entitles the holder to one ordinary B share in Pay Perform Management Limited at a nominal value of £0.00001.

 

The number of share options outstanding at the start and end of the year are as follows:

Group
Number of share options
Weighted average exercise price
2023
2022
2023
2022
Unaudited
Unaudited
Number
Number
£
£
Outstanding at 1 December 2022
404,103
333,321
0.01
0.01
Granted
199,162
501,805
0.01
0.01
Forfeited
(86,580)
(431,023)
0.01
0.01
Exercised
-
-
0.01
0.01
Outstanding at 30 November 2023
516,685
404,103
0.01
0.01
Exercisable at 30 November 2023
-
-
0.01
0.01

The options outstanding at 30 November 2023 had an average exercise price of £0.01 and an average remaining contractual life of 16 months.

Liabilities at the period end

During the year, Pay Perform Management Limited recognised total share-based payment expenses of £61,199 (2022 - £29,966) which related to equity settled share based payment transactions.

PAY PERFORM HOLDINGS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 24 -
19
Share capital
Group and company
2023
2022
2023
2022
Unaudited
Unaudited
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary A shares of 0.1p each
3,500
3,500
35
35
Ordinary AA shares of 0.1p each
500
500
5
5
Ordinary B shares of 0.1p each
1,500
1,500
15
15
Ordinary BB shares of 0.1p each
500
500
5
5
Ordinary C shares of 0.1p each
1,500
1,500
15
15
Ordinary CC shares of 0.1p each
500
500
5
5
Ordinary D shares of 0.1p each
500
500
5
5
Ordinary DD shares of 0.1p each
500
500
5
5
Ordinary E shares of 0.1p each
250
250
2
2
Ordinary EE shares of 0.1p each
750
750
8
8
10,000
10,000
100
100
20
Reserves
Shares to be issued

During the period, the subsidiary undertaking, Pay Perform Management Limited, raised £4,639,015 in respect of Advanced Share Subscriptions for ordinary shares of 0.001p each, to be allotted on a future date or upon the occurrence of certain specified events.

 

Of this sum, £625,635 was subsequently used to subscribe for 137,640 Ordinary shares of 0.001p each post year end in Pay Perform Management Limited.

 

The balance of this sum was subsequently used to subscribe for Ordinary shares of 0.001p each in Pay Perform Holdings Limited post year end.

21
Operating lease commitments
Lessee

At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

Group
Company
2023
2022
2023
2022
Unaudited
Unaudited
£
£
£
£
Within one year
287,780
95,982
-
-
Between two and five years
409,240
278,675
-
-
In over five years
296,926
366,791
-
-
993,946
741,448
-
-
PAY PERFORM HOLDINGS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 25 -
22
Events after the reporting date

On 29 January 2024, the company's share capital of 10,000 ordinary shares of £0.01 was sub-divided into 10,000,000 ordinary shares of £0.00001.

 

On 31 January 2024, it was proposed by the Directors that the group undergo a restructuring to facilitate future investment in Pay Perform Holdings Limited. Certain investors, referred to as the ASA Holders, had entered into advanced subscription agreements (ASAs) with Pay Perform Management Limited, the subsidiary undertaking valuing each ordinary share at £4.55. As part of this restructuring, ASA Holders provided funds amounting to £5,030,435, which were to convert into 1,106,696 ordinary shares in Pay Perform Management Limited by 31 January 2024. It was proposed that these shares be issued to Pay Perform Holdings Limited and that Pay Perform Holdings Limited would, in turn, grant warrants to the ASA Holders to subscribe for an equivalent number of shares. Additionally, individuals holding options over shares in Pay Perform Management Limited were to be given the opportunity to exchange these for equivalent options in Pay Perform Holdings Limited, under a new option scheme established by Pay Perform Holdings Limited.

 

Between 8 February 2024, and 8 March 2024, five out of six ASAs were successfully converted into shares of Pay Perform Holdings Limited. However, one investor preferred to convert into shares in Pay Perform Management Limited and this was done on 15 May 2024.

23
Related party transactions

The company has taken advantage of the exemption available in FRS 102 whereby it has not disclosed transactions between itself and/ or any wholly owned subsidiary undertaking.

24
Directors' transactions

During the year the group paid Mr C Mason interest charges of £21,944 (2022: £3,952) on a directors loan of £210,000 that has been fully repaid at 30 November 2023.

25
Cash generated from group operations
2023
2022
Unaudited
£
£
Profit/(loss) for the year after tax
579,132
(1,133,268)
Adjustments for:
Taxation charged/(credited)
41,975
(27,129)
Finance costs
24,845
3,952
Depreciation and impairment of tangible fixed assets
20,398
15,154
Equity settled share based payment expense
61,199
29,966
Movements in working capital:
Increase in stocks
(7,988,729)
(1,114,112)
(Increase)/decrease in debtors
(248,461)
1,203,823
Increase in creditors
30,589,091
6,201,685
Cash generated from operations
23,079,450
5,180,071
PAY PERFORM HOLDINGS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 26 -
26
Analysis of changes in net funds - group
1 December 2022
Cash flows
30 November 2023
Unaudited
£
£
£
Cash at bank and in hand
8,811,250
27,312,395
36,123,645
Borrowings excluding overdrafts
(210,000)
210,000
-
8,601,250
27,522,395
36,123,645
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