REGISTERED NUMBER: 08358482 (England and Wales) |
Group Strategic Report, Report of the Director and |
Consolidated Financial Statements |
for the Period 1 April 2023 to 31 December 2023 |
for |
Tessian Limited |
REGISTERED NUMBER: 08358482 (England and Wales) |
Group Strategic Report, Report of the Director and |
Consolidated Financial Statements |
for the Period 1 April 2023 to 31 December 2023 |
for |
Tessian Limited |
Tessian Limited (Registered number: 08358482) |
Contents of the Consolidated Financial Statements |
for the Period 1 April 2023 to 31 December 2023 |
Page |
Company Information | 1 |
Group Strategic Report | 2 |
Report of the Director | 4 |
Report of the Independent Auditors | 6 |
Consolidated Income Statement | 9 |
Consolidated Other Comprehensive Income | 10 |
Consolidated Balance Sheet | 11 |
Company Balance Sheet | 12 |
Consolidated Statement of Changes in Equity | 13 |
Company Statement of Changes in Equity | 14 |
Consolidated Cash Flow Statement | 15 |
Notes to the Consolidated Cash Flow Statement | 16 |
Notes to the Consolidated Financial Statements | 17 |
Tessian Limited |
Company Information |
for the Period 1 April 2023 to 31 December 2023 |
DIRECTOR: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
AUDITORS: |
Statutory Auditors |
TOR |
Saint-Cloud Way |
Maidenhead |
Berkshire |
SL6 8BN |
Tessian Limited (Registered number: 08358482) |
Group Strategic Report |
for the Period 1 April 2023 to 31 December 2023 |
The director presents his strategic report of the company and the group for the period 1 April 2023 to 31 December 2023. |
PRINCIPAL ACTIVITIES AND REVIEW OF THE BUSINESS |
The Tessian Cloud Email Security platform helps enterprises defend against email attacks, protect against data loss and respond to security incidents more efficiently. By combining artificial intelligence with an understanding of employee email behaviour, Tessian is able to prevent complex email attacks and data loss incidents that evade Secure Email Gateways and the built in security controls of M365 and Google Workspace. Tessian can be seamlessly integrated on top of existing email security tools or replace legacy technology to simplify the email security stack. |
Some of the world's largest banks, healthcare organisations, hedge funds and law firms all use Tessian to secure their email environments, data and people whilst saving their security team time. In FY23, Tessian continued to prevent hundreds of thousands of business email compromise attacks, data loss incidents and saved hundreds of hours of work for security teams. |
Tessian is headquartered in London and Boston with 200+ employees globally, and in December 2023 was acquired by Proofpoint Inc |
During the financial period 31 December 2023 Tessian had revenue of £24m, and reported a loss of £28.2m (FY March 2023: loss of £33.4m). This is in line with expectations for a fast growing venture backed technology company. Cash balance was £14.2m as at 31 December 2023. |
In FY 2023, Tessian retained its SDC 2 Type II compliance certification and ISO 27001 certification. The group, and Tessians' Cloud Email Security platform was recognised for excellence and achievement through major publications. |
These include: |
- The Forrester Wave- Enterprise Email Security Q2 2023 |
- Gartner- Voice of the Customer for Email Security Aug 2023 |
- Gartner- Market Guide for Data Loss Prevention Sep 2023 |
- KuppingerCole- 2023 Leadership Compass:Email Security- the acquisition is mentioned |
Tessian is led by six company values that guide day to day decision making and are a true reflection of how the company operates. They're actionable, intuitive, and central to everything Tessian does, from recruitment, through to performance and development, and how Tessian interacts with its stakeholders. |
Tessian's Six Guiding Values are: |
- Human first. |
- Customer centricity |
- Positive mindset. Solution orientated |
- We do the right thing. |
- Craft at speed. |
PRINCIPAL RISKS AND UNCERTAINTIES |
Tessian faces challenges similar to other fast-growing early-stage SaaS technology companies: |
- continuing a fast-paced go to market motion; |
- scaling product delivery to meet customer demand and maintain customer centricity; |
- recruitment and retention of talented employees; and |
- competition threat as Tessian broadens its services into new fields. |
FINANCIAL RISK MANAGEMENT POLICIES AND OBJECTIVES |
Tessian manages its key financial risks as follows: |
Credit risk: The principal credit risk relates to trade receivables. Through the Customer centricity value, the Group maintains active relationships with clients and the Group seeks to deal with trading entities where the risk of default is considered low. |
Liquidity risk: The Group manages cash flow risk by maintaining and reviewing cash flow forecasts on a regular basis and ensuring there is sufficient investment to meet foreseeable needs. |
Currency risk: The Group predominantly operates in GBP and USD, the Group holds both currencies in line with forecast spend and continuously monitors & rebalances its cash currency split to ensure cash holdings match forecast currency. |
EMPLOYEE ENGAGEMENT |
The Group regularly engages with the employee base through a number of mechanisms, including a frequent employee survey and feedback which is considered regularly at the manager, Executive and Board level. |
Tessian Limited (Registered number: 08358482) |
Group Strategic Report |
for the Period 1 April 2023 to 31 December 2023 |
KEY PERFORMANCE INDICATORS |
The group's key financial performance indicators during the period were as follows: |
Dec 2023 | Mar 2023 |
£'000s | £'000s |
Group turnover | 23,924 | 27,576 |
Gross profit margin | 77.0% | 74.0% |
Operating profit / (loss) | (26,924 | ) | (36,394 | ) |
EBITDA | (26,760 | ) | (36,140 | ) |
FUTURE DEVELOPMENTS |
In the future, our company intends to continue developing its complete cloud email security platform to better protect its customers from inbound attacks, protect them against data loss, and efficiently respond to incidents. Tessian has ongoing development plans to improve its efficiency and financial performance through streamlining architecture, deduplicating databases and merging dataflow. The company will also focus on enhancing its current products, and their offerings, together with providing additional value added platform services to its customers in the future. |
Tessian participates in rapidly evolving and competitive email security and data loss prevention cybersecurity segments with both large, established vendors as well as smaller startups, all seeking to compete on cutting edge innovations, including the use of AI to increase threat detection efficacy. With continued investment in research and development, focus on product enhancement and offering, and talent management the company will continue to navigate the competitive marketplace. |
ON BEHALF OF THE BOARD: |
Tessian Limited (Registered number: 08358482) |
Report of the Director |
for the Period 1 April 2023 to 31 December 2023 |
The director presents his report with the financial statements of the company and the group for the period 1 April 2023 to 31 December 2023. |
DIVIDENDS |
No dividends will be distributed for the period ended 31 December 2023. |
FUTURE DEVELOPMENTS |
EVENTS SINCE THE END OF THE PERIOD |
Information relating to events since the end of the period is given in the notes to the financial statements. |
DIRECTORS |
The directors who have held office during the period from 1 April 2023 to the date of this report are as follows: |
GOING CONCERN |
During financial period 2023, the Group reported a loss of £28.2m (FY March 23: loss of £33.4m) and as at 31 December 2023 had net current assets of £23.3m including cash of £14.2m. The loss reflects investments in research & development, sales, and marketing in order to develop existing products, grow our customer base, delivering increasing levels of value to our customers and increased management incentives in the form of share options. |
The Group is confident there are sufficient cash reserves to trade for more than 12 months from the date of approval of the financial statements. The Group has considered a severe but plausible downside scenario with decreasing sales and higher than targeted expenditure, which still showed a going concern status. The metric Free Cash Flow has been a used in forecasting and in considering the going concern basis. |
Tessian Limited's ultimate parent company, Proofpoint Inc, remains in a strong financial position as at 31 December 2023 and has no concerns about being able to continue providing support to its subsidiaries for the foreseeable future. |
For this reason the Directors are confident that the Group can continue in operational existence for the foreseeable future being a period of at least 12 months from the signing of these financial statements and as a result have prepared the accounts on a going concern basis. Research and Development The Group's research and development team is predominantly based in the UK and are primarily focused on developing Tessian's core products. We have submitted an R&D tax credit claim for this financial year, as per previous years. |
STATEMENT OF DIRECTOR'S RESPONSIBILITIES |
The director is responsible for preparing the Group Strategic Report, the Report of the Director and the financial statements in accordance with applicable law and regulations. |
Company law requires the director to prepare financial statements for each financial year. Under that law the director has 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 director must not approve the financial statements unless he is 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 director is required to: |
- | select suitable accounting policies 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 company will continue in business. |
Tessian Limited (Registered number: 08358482) |
Report of the Director |
for the Period 1 April 2023 to 31 December 2023 |
STATEMENT OF DIRECTOR'S RESPONSIBILITIES - continued |
The director is responsible for keeping adequate accounting records that are sufficient to show and explain the company's and the group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group and enable him to ensure that the financial statements comply with the Companies Act 2006. He is 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. |
STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS |
So far as the director is aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the group's auditors are unaware, and he has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the group's auditors are aware of that information. |
ON BEHALF OF THE BOARD: |
Report of the Independent Auditors to the Members of |
Tessian Limited |
Opinion |
We have audited the financial statements of Tessian Limited (the 'parent company') and its subsidiaries (the 'group') for the period ended 31 December 2023 which comprise the Consolidated Income Statement, Consolidated Other Comprehensive Income, Consolidated Balance Sheet, Company Balance Sheet, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated Cash Flow Statement and Notes to the Consolidated Cash Flow Statement, 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 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: |
- | give a true and fair view of the state of the group's and of the parent company affairs as at 31 December 2023 and of the group's loss for the period 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. |
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 Auditors' 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 opinion. |
Conclusions relating to going concern |
In auditing the financial statements, we have concluded that the director's 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 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 director with respect to going concern are described in the relevant sections of this report. |
Other information |
The director is responsible for the other information. The other information comprises the information in the Group Strategic Report and the Report of the Director, but does not include the financial statements and our Report of the Auditors thereon. |
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. |
In connection with our audit of the financial statements, 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 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 the audit: |
- | the information given in the Group Strategic Report and the Report of the Director for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
- | the Group Strategic Report and the Report of the Director have been prepared in accordance with applicable legal requirements. |
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 its environment obtained in the course of the audit, we have not identified material misstatements in the Group Strategic Report or the Report of the Director. |
We have nothing to report in respect of the following matters where 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 director's remuneration specified by law are not made; or |
- | we have not received all the information and explanations we require for our audit. |
Report of the Independent Auditors to the Members of |
Tessian Limited |
Responsibilities of director |
As explained more fully in the Statement of Director's Responsibilities set out on pages four and five, the director is 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 director determines 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 director is responsible for assessing the group's 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 director either intends to liquidate the group or the parent company or to cease operations, or has no realistic alternative but to do so. |
Auditors' 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 a Report of the Auditors 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: |
- the engagement partner ensures that the engagement team collectively had the appropriate competence capabilities and skills to identify or recognise non-compliance with applicable laws and regulations; |
- we identified the laws and regulations applicable to the group and the parent company through discussions with directors and other management, and from our commercial knowledge and experience of the sector; |
- we focused on specific laws and regulations which were considered may have a direct material effect on the financial statements or the operations of the group and the parent company, including the Companies Act 2006, taxation legislation, anti-bribery, employment and health and safety legislation; |
- we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and |
- identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit. |
- we assessed the susceptibility of the group's and the parent company's financial statements to material misstatement, including obtaining an understanding of how fraud might occur by; |
- making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; |
- considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations and; |
- understanding the design of the group and the parent company's remuneration policies. |
To address the risk of fraud through management bias and override of controls we; |
- performed analytical procedures to identify any unusual or unexpected relationships; |
- tested journal entries to identify unusual transactions; |
- assessed whether judgements and assumptions made in determining the accounting estimates were indicative of potential bias; and |
- investigated the rational behind significant or unusual transactions. |
There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any. |
Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion. |
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 Report of the Auditors. |
Report of the Independent Auditors to the Members of |
Tessian Limited |
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 a Report of the Auditors 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. |
for and on behalf of |
Statutory Auditors |
TOR |
Saint-Cloud Way |
Maidenhead |
Berkshire |
SL6 8BN |
Tessian Limited (Registered number: 08358482) |
Consolidated Income Statement |
for the Period 1 April 2023 to 31 December 2023 |
Period |
1.4.23 |
to | Year Ended |
31.12.23 | 31.3.23 |
Notes | £ | £ |
TURNOVER | 3 | 23,923,812 | 27,576,444 |
Cost of sales | (5,459,561 | ) | (7,268,924 | ) |
GROSS PROFIT | 18,464,251 | 20,307,520 |
Administrative expenses | (46,356,592 | ) | (56,701,375 | ) |
(27,892,341 | ) | (36,393,855 | ) |
Other operating income | 968,787 | - |
OPERATING LOSS | 5 | (26,923,554 | ) | (36,393,855 | ) |
Interest receivable and similar income | 918,396 | 683,861 |
(26,005,158 | ) | (35,709,994 | ) |
Interest payable and similar expenses | 6 | (1,983,813 | ) | (124,311 | ) |
LOSS BEFORE TAXATION | (27,988,971 | ) | (35,834,305 | ) |
Tax on loss | 7 | (214,722 | ) | 2,406,082 |
LOSS FOR THE FINANCIAL PERIOD | ( |
) | ( |
) |
Loss attributable to: |
Owners of the parent | (28,203,693 | ) | (33,428,223 | ) |
Tessian Limited (Registered number: 08358482) |
Consolidated Other Comprehensive Income |
for the Period 1 April 2023 to 31 December 2023 |
Period |
1.4.23 |
to | Year Ended |
31.12.23 | 31.3.23 |
Notes | £ | £ |
LOSS FOR THE PERIOD | (28,203,693 | ) | (33,428,223 | ) |
OTHER COMPREHENSIVE INCOME |
Foreign exchange | 1,021,541 | (618,460 | ) |
Income tax relating to other comprehensive income |
- |
- |
OTHER COMPREHENSIVE INCOME FOR THE PERIOD, NET OF INCOME TAX |
1,021,541 |
(618,460 |
) |
TOTAL COMPREHENSIVE INCOME FOR THE PERIOD |
(27,182,152 |
) |
(34,046,683 |
) |
Total comprehensive income attributable to: |
Owners of the parent | (27,182,152 | ) | (34,046,683 | ) |
Tessian Limited (Registered number: 08358482) |
Consolidated Balance Sheet |
31 December 2023 |
31.12.23 | 31.3.23 |
Notes | £ | £ |
FIXED ASSETS |
Tangible assets | 9 | 230,017 | 398,832 |
Investments | 10 | - | - |
230,017 | 398,832 |
CURRENT ASSETS |
Debtors | 11 | 9,127,830 | 10,161,970 |
Cash at bank | 14,188,348 | 50,231,256 |
23,316,178 | 60,393,226 |
CREDITORS |
Amounts falling due within one year | 12 | (24,753,119 | ) | (23,838,447 | ) |
NET CURRENT (LIABILITIES)/ASSETS | (1,436,941 | ) | 36,554,779 |
TOTAL ASSETS LESS CURRENT LIABILITIES | (1,206,924 | ) | 36,953,611 |
CREDITORS |
Amounts falling due after more than one year | 13 | - | (19,351,951 | ) |
PROVISIONS FOR LIABILITIES | 17 | (35,560 | ) | (79,193 | ) |
NET (LIABILITIES)/ASSETS | (1,242,484 | ) | 17,522,467 |
CAPITAL AND RESERVES |
Called up share capital | 18 | 3,478 | 3,103 |
Share premium | 19 | 100,818,599 | 95,169,414 |
Foreign exchange reserve | 19 | 132,729 | (888,812 | ) |
Share based payment reserve | 19 | - | 15,480,048 |
Retained earnings | 19 | (102,197,290 | ) | (92,241,286 | ) |
(1,242,484 | ) | 17,522,467 |
The financial statements were approved by the director and authorised for issue on 4 February 2025 and were signed by: |
Mr K M Chin - Director |
Tessian Limited (Registered number: 08358482) |
Company Balance Sheet |
31 December 2023 |
31.12.23 | 31.3.23 |
Notes | £ | £ |
FIXED ASSETS |
Tangible assets | 9 |
Investments | 10 |
CURRENT ASSETS |
Debtors | 11 |
Cash at bank |
CREDITORS |
Amounts falling due within one year | 12 | ( |
) | ( |
) |
NET CURRENT ASSETS |
TOTAL ASSETS LESS CURRENT LIABILITIES |
PROVISIONS FOR LIABILITIES | 17 | ( |
) | ( |
) |
NET ASSETS |
CAPITAL AND RESERVES |
Called up share capital | 18 |
Share premium | 19 |
Share based payment reserve | 19 |
Retained earnings | 19 | ( |
) | ( |
) |
Company's loss for the financial year | (32,184,257 | ) | (15,396,398 | ) |
The financial statements were approved by the director and authorised for issue on |
Tessian Limited (Registered number: 08358482) |
Consolidated Statement of Changes in Equity |
for the Period 1 April 2023 to 31 December 2023 |
Called up |
share | Retained | Share |
capital | earnings | premium |
£ | £ | £ |
Balance at 1 April 2022 | 3,079 | (59,200,189 | ) | 94,780,510 |
Changes in equity |
Issue of share capital | 24 | - | 388,904 |
Total comprehensive income | - | (33,041,097 | ) | - |
Balance at 31 March 2023 | 3,103 | (92,241,286 | ) | 95,169,414 |
Changes in equity |
Issue of share capital | 375 | - | 5,649,185 |
Total comprehensive income | - | (28,203,693 | ) | - |
Share based payment transfer | - | 18,247,689 | - |
Balance at 31 December 2023 | 3,478 | (102,197,290 | ) | 100,818,599 |
Share |
Foreign | based |
exchange | payment | Total |
reserve | reserve | equity |
£ | £ | £ |
Balance at 1 April 2022 | (888,812 | ) | 6,950,998 | 41,645,586 |
Changes in equity |
Issue of share capital | - | - | 388,928 |
Total comprehensive income | - | 8,529,050 | (24,512,047 | ) |
Balance at 31 March 2023 | (888,812 | ) | 15,480,048 | 17,522,467 |
Changes in equity |
Issue of share capital | - | - | 5,649,560 |
Total comprehensive income | 1,021,541 | - | (27,182,152 | ) |
Share based payment movement | - | 2,767,641 | 2,767,641 |
Share based payment transfer | - | (18,247,689 | ) | - |
Balance at 31 December 2023 | 132,729 | - | (1,242,484 | ) |
Tessian Limited (Registered number: 08358482) |
Company Statement of Changes in Equity |
for the Period 1 April 2023 to 31 December 2023 |
Share |
Called up | based |
share | Retained | Share | payment | Total |
capital | earnings | premium | reserve | equity |
£ | £ | £ | £ | £ |
Balance at 1 April 2022 | ( |
) |
Changes in equity |
Issue of share capital | - | - |
Total comprehensive income | - | ( |
) | - | ( |
) |
Balance at 31 March 2023 | ( |
) |
Changes in equity |
Issue of share capital | - | - |
Total comprehensive income | - | ( |
) | - | ( |
) |
Share based payment movement | - | - | - | 2,760,058 | 2,760,058 |
Share based payment transfer | - | 18,247,689 | - | (18,247,689 | ) | - |
Balance at 31 December 2023 | ( |
) |
Tessian Limited (Registered number: 08358482) |
Consolidated Cash Flow Statement |
for the Period 1 April 2023 to 31 December 2023 |
Period |
1.4.23 |
to | Year Ended |
31.12.23 | 31.3.23 |
Notes | £ | £ |
Cash flows from operating activities |
Cash generated from operations | 1 | (20,305,089 | ) | (23,963,223 | ) |
R&D tax credit received | (980,798 | ) | 1,538,984 |
Net cash from operating activities | (21,285,887 | ) | (22,424,239 | ) |
Cash flows from investing activities |
Purchase of tangible fixed assets | (6,670 | ) | (196,674 | ) |
Sale of tangible fixed assets | 17,457 | 2,608 |
Interest received | 918,396 | 683,861 |
Net cash from investing activities | 929,183 | 489,795 |
Cash flows from financing activities |
Proceeds from borrowings | - | 19,351,951 |
Loan repayments in year | (19,351,951 | ) | - |
Interest paid | (1,983,813 | ) | (124,311 | ) |
Share issue | 5,649,560 | 388,928 |
Net cash from financing activities | (15,686,204 | ) | 19,616,568 |
Decrease in cash and cash equivalents | (36,042,908 | ) | (2,317,876 | ) |
Cash and cash equivalents at beginning of period |
2 |
50,231,256 |
52,549,132 |
Cash and cash equivalents at end of period | 2 | 14,188,348 | 50,231,256 |
Tessian Limited (Registered number: 08358482) |
Notes to the Consolidated Cash Flow Statement |
for the Period 1 April 2023 to 31 December 2023 |
1. | RECONCILIATION OF LOSS BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS |
Period |
1.4.23 |
to | Year Ended |
31.12.23 | 31.3.23 |
£ | £ |
Loss before taxation | (27,988,971 | ) | (35,834,305 | ) |
Depreciation charges | 163,757 | 313,606 |
(Profit)/loss on disposal of fixed assets | (5,146 | ) | 82,679 |
(Decrease)/increase in provisions | - | (9,567 | ) |
Foreign exchange | 1,021,541 | (618,460 | ) |
Movement in share based payments reserve | 2,767,642 | 8,529,044 |
Finance costs | 1,983,813 | 124,311 |
Finance income | (918,396 | ) | (683,861 | ) |
(22,975,760 | ) | (28,096,553 | ) |
Decrease/(increase) in trade and other debtors | 1,760,730 | (703,451 | ) |
Increase in trade and other creditors | 909,941 | 4,836,781 |
Cash generated from operations | (20,305,089 | ) | (23,963,223 | ) |
2. | CASH AND CASH EQUIVALENTS |
The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts: |
Period ended 31 December 2023 |
31.12.23 | 1.4.23 |
£ | £ |
Cash and cash equivalents | 14,188,348 | 50,231,256 |
Year ended 31 March 2023 |
31.3.23 | 1.4.22 |
£ | £ |
Cash and cash equivalents | 50,231,256 | 52,549,132 |
3. | ANALYSIS OF CHANGES IN NET FUNDS |
At 1.4.23 | Cash flow | At 31.12.23 |
£ | £ | £ |
Net cash |
Cash at bank | 50,231,256 | (36,042,908 | ) | 14,188,348 |
50,231,256 | (36,042,908 | ) | 14,188,348 |
Debt |
Debts falling due after 1 year | (19,351,951 | ) | 19,351,951 | - |
(19,351,951 | ) | 19,351,951 | - |
Total | 30,879,305 | (16,690,957 | ) | 14,188,348 |
Tessian Limited (Registered number: 08358482) |
Notes to the Consolidated Financial Statements |
for the Period 1 April 2023 to 31 December 2023 |
1. | STATUTORY INFORMATION |
Tessian Limited is a |
The presentation currency of the financial statements is the Pound Sterling (£). |
Tessian Limited is a private company, limited by shares, domiciled and incorporated in the England and Wales (Registered number: 08358482). The registered office address is 5 Churchill Place, 10th Floor, London, United Kingdom, E14 5HU. |
2. | ACCOUNTING POLICIES |
Basis of preparing the 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 judgment in applying the group's accounting policies (see note 2). |
The following principal accounting policies have been applied consistently, other than where new policies have been adopted |
Basis of consolidation |
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 balance sheet, 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 profit and loss account from the date on which control is obtained. They are deconsolidated from the date control ceases. |
Going concern |
Tessian Limited's ultimate parent company, Proofpoint Inc, remains in a strong financial position as at 31 December 2023 with over $361M of cash and cash equivalents and strong revenue growth. Proofpoint also has access to a $300M revolving line of credit and the additional backing of Thoma Bravo, a large and well funded private equity conglomerate. Given Proofpoint, Inc.’s strong cash position, recurring revenue base, commitment to continue growing the business, Proofpoint, Inc. has no concerns about being able to continue providing support to its subsidiaries for the foreseeable future. |
Related party exemption |
The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group. |
Transactions between group entities which have been eliminated on consolidation are not disclosed within the financial statements. |
Tessian Limited (Registered number: 08358482) |
Notes to the Consolidated Financial Statements - continued |
for the Period 1 April 2023 to 31 December 2023 |
2. | ACCOUNTING POLICIES - continued |
Significant judgements and estimates |
The preparation of financial statements to conform to generally accepted accounting practice requires management to make estimates and judgements that affect the reported amounts of assets and liabilities as well as the disclosure of contingent assets and liabilities at the balance sheet date and the reapportioned amounts of revenues and expenses during the reporting period. |
Key judgments |
Bad debt provisions |
The trade debtors balance recorded in the group's Consolidated balance sheet comprise a number of small balances. A full line by line review of trade debtors is carried out at the end of each month. Whilst every attempt is made to ensure that the bad debt provisions are as accurate as possible, there remains a risk that the provisions do not match the level of debts which ultimately prove to be not collectable |
Financial instruments classification |
The classification of financial instruments as "basic" or "other" requires judgement as to whether all the applicable conditions for classification as basic are met. This includes consideration of the form of the instrument and its return. |
Share based payments |
Estimates have been made to value the equity settled share based payments recognised through the issuance of share options during the period. The key assumptions used centre on the share price volatility associated with the company's share price. |
Turnover |
Turnover is recognised to the extent that it is probable that the economic benefits will flow to the group and the turnover can be reliably measured. Turnover 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 turnover is recognised: |
Rendering of services |
Turnover 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 turnover 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. |
Once the above has been satisfied, revenue is recognised evenly over the life of the signed contract. Income is deferred and accrued in line with the FRS 102 framework. |
Tessian Limited (Registered number: 08358482) |
Notes to the Consolidated Financial Statements - continued |
for the Period 1 April 2023 to 31 December 2023 |
2. | ACCOUNTING POLICIES - continued |
Tangible fixed assets |
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. |
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: |
- Office equipment - 4 years |
- Computer equipment - 3 years |
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 |
Investments in subsidiaries are measured at cost less accumulated impairment. |
Financial instruments |
Financial assets and financial liabilities are recognised in the balance sheet when the group becomes party to the contractual provisions of the instrument. |
Trade and other debtors and creditors are classified as basic financial instruments and measured at initial recognition at transaction price. Debtors and creditors are subsequently measured at amortised cost using the effective interest rate method. A provision is established when there is objective evidence that the group will not be able to collect all amounts due. |
Cash and cash equivalents are classified as basic financial instruments and comprise cash in hand nd at bank, short-term bank deposits with an original maturity of three months or less and bank overdrafts which are an integral part of the group's cash management. |
Financial liabilities and equity instruments issued by the group are classified in accordance with the substance of the contractual arrangements entered into and the definitions of a financial liability and an equity instrument. An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities. Equity instruments issued by the group are recorded at the proceeds received, net of direct issue costs. |
The group has chosen to adopt Sections 11 and 12 of FRS 102 in respect of financial instruments as er the above. |
Taxation |
Taxation for the period comprises current and deferred tax. Tax is recognised in the Consolidated Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. |
Current or deferred taxation assets and liabilities are not discounted. |
Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date. |
Deferred tax |
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date. |
Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the period end and that are expected to apply to the reversal of the timing difference. |
Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. |
Tessian Limited (Registered number: 08358482) |
Notes to the Consolidated Financial Statements - continued |
for the Period 1 April 2023 to 31 December 2023 |
2. | ACCOUNTING POLICIES - continued |
Research and development |
Expenditure on research and development is written off in the year in which it is incurred. |
Leases |
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases. At the balance sheet date all leases are clarified as operating leases. |
Rentals paid under operating leases are charged to the Consolidated statement of comprehensive income on a straight-line basis over the lease term. |
Benefits received and receivable as an incentive to enter into an operating lease are also spread on a straight-line basis over the lease term. |
Pension costs and other post-retirement benefits |
The group operates a defined contribution pension scheme. Contributions payable to the group's pension scheme are charged to profit or loss in the period to which they relate. |
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 balance sheet. The assets of the plan are held separately from the group in independently administered funds. |
The defined benefit obligation is calculated using the projected unit credit method. Annually the company engages independent actuaries to calculate the obligation. The present value is determined by discounting the estimated future payments using market yields on high quality corporate bonds that are denominated in sterling and that have terms approximating to the estimated period of the future payments ('discount rate'). |
Foreign currency translation |
Functional and presentation currency |
The company's functional and presentational currency is GBP. |
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 the Consolidated statement of comprehensive income within 'administrative expenses'. |
Foreign exchange gains and losses are presented within 'administrative expenses'. Those that relate to borrowings and cash and cash equivalents are presented in the Consolidated statement of comprehensive income. |
On consolidation, the results of overseas operations are translated into sterling 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. |
Tessian Limited (Registered number: 08358482) |
Notes to the Consolidated Financial Statements - continued |
for the Period 1 April 2023 to 31 December 2023 |
2. | ACCOUNTING POLICIES - continued |
Interest income |
Interest income is recognised in profit or loss using the effective interest method. |
Finance cost |
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. |
Exceptional items |
Exceptional items are transactions that fall within the ordinary activities of the group but are presented separately due to their size or incidence. |
Provisions for liabilities |
Provisions are made where an event has taken place that gives the group a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation. |
Provisions are charged as an expense to profit or loss in the year that the group becomes aware of the obligation, and are measured at the best estimate at the balance sheet date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties. |
When payments are eventually made, they are charged to the provision carried in the balance sheet. |
Share-based payments |
Where share options are awarded to employees, the fair value of the options at the date of grant is charged to profit or loss over the vesting period. Non-market vesting conditions are taken into account by adjusting the number of equity instruments expected to vest at each balance sheet date so that, ultimately, the cumulative amount recognised over the vesting period is based on the number of options that eventually vest. Market vesting conditions are factored into the fair value of the options granted. The cumulative expense is not adjusted for failure to achieve a market vesting condition. The fair value of the award also takes into account non-vesting conditions. These are either factors beyond the control of either party (such as a target based on an index) or factors which are within the control of one or other of the parties (such as the group keeping the scheme open or the employee maintaining any contributions required by the scheme). Where the terms and conditions of options are modified before they vest, the increase in the fair value of the options, measured immediately before and after the modification, is also charged to profit or loss over the remaining vesting period. Where equity instruments are granted to persons other than employees, profit or loss is charged with fair value of goods and services received. |
3. | TURNOVER |
The turnover and loss before taxation are attributable to the one principal activity of the group. |
An analysis of turnover by class of business is given below: |
Period |
1.4.23 |
to | Year Ended |
31.12.23 | 31.3.23 |
£ | £ |
cybersecurity software | 23,923,812 | 27,576,444 |
23,923,812 | 27,576,444 |
Tessian Limited (Registered number: 08358482) |
Notes to the Consolidated Financial Statements - continued |
for the Period 1 April 2023 to 31 December 2023 |
3. | TURNOVER - continued |
An analysis of turnover by geographical market is given below: |
Period |
1.4.23 |
to | Year Ended |
31.12.23 | 31.3.23 |
£ | £ |
United Kingdom | 9,834,744 | 12,339,929 |
Europe | 2,972,022 | 2,423,620 |
Rest of the world | 11,117,046 | 12,812,895 |
23,923,812 | 27,576,444 |
4. | EMPLOYEES AND DIRECTORS |
Period |
1.4.23 |
to | Year Ended |
31.12.23 | 31.3.23 |
£ | £ |
Wages and salaries | 24,611,831 | 27,917,611 |
Social security costs | 1,864,663 | 2,469,141 |
Other pension costs | 1,074,099 | 1,757,761 |
27,550,593 | 32,144,513 |
The average number of employees during the period was as follows: |
Period |
1.4.23 |
to | Year Ended |
31.12.23 | 31.3.23 |
Research and development | 81 | 90 |
Sales and marketing | 51 | 94 |
Technical support | 8 | 8 |
General and administrative | 30 | 30 |
Period1.4.23to3 1.12.23 |
Year Ended31.3.23 |
£ | £ |
Directors' emoluments | 4,198,828 | 547,465 |
Group contributions to defined contribution pension schemes | 26,812 | 32,731 |
4,225,010 | 580,196 |
During the period retirement benefits were accruing fro 2 directors (31 March 2023: 2) in respect of defined contribution pension schemes. |
The highest paid director received remuneration of £2,119,504 (31 March 2023: £301,715) |
The value of the group's contributions paid to a defined contribution pension scheme in respect of the highest paid director amounted to £16,825 (31 March 2023: £17,732) |
Tessian Limited (Registered number: 08358482) |
Notes to the Consolidated Financial Statements - continued |
for the Period 1 April 2023 to 31 December 2023 |
5. | OPERATING LOSS |
The operating loss is stated after charging/(crediting): |
Period |
1.4.23 |
to | Year Ended |
31.12.23 | 31.3.23 |
£ | £ |
Other operating leases | 716,637 | 901,224 |
Depreciation - owned assets | 163,174 | 253,908 |
(Profit)/loss on disposal of fixed assets | (5,146 | ) | 82,679 |
Auditors' remuneration | 39,710 | 100,000 |
Foreign exchange differences | 1,338,046 | (2,233,958 | ) |
6. | INTEREST PAYABLE AND SIMILAR EXPENSES |
Period |
1.4.23 |
to | Year Ended |
31.12.23 | 31.3.23 |
£ | £ |
Loan interest | 1,983,813 | 124,311 |
7. | TAXATION |
Analysis of the tax charge/(credit) |
The tax charge/(credit) on the loss for the period was as follows: |
Period |
1.4.23 |
to | Year Ended |
31.12.23 | 31.3.23 |
£ | £ |
Current tax: |
UK corporation tax | 258,355 | (2,372,191 | ) |
Deferred tax | (43,633 | ) | (33,891 | ) |
Tax on loss | 214,722 | (2,406,082 | ) |
Tessian Limited (Registered number: 08358482) |
Notes to the Consolidated Financial Statements - continued |
for the Period 1 April 2023 to 31 December 2023 |
7. | TAXATION - continued |
Reconciliation of total tax charge/(credit) included in profit and loss |
The tax assessed for the period is higher than the standard rate of corporation tax in the UK. The difference is explained below: |
Period |
1.4.23 |
to | Year Ended |
31.12.23 | 31.3.23 |
£ | £ |
Loss before tax | (27,988,971 | ) | (35,834,305 | ) |
Loss multiplied by the standard rate of corporation tax in the UK of 25 % (2023 - 19 %) |
(6,997,243 |
) |
(6,808,518 |
) |
Effects of: |
Expenses not deductible for tax purposes | 837,949 | 116,277 |
Adjustments to tax charge in respect of previous periods | 14,157 | (221,321 | ) |
Other permanent differences | - | (60,010 | ) |
Additional deduction for R&D expenditure | - | (1,592,873 | ) |
Surrender of tax losses for R&D tax credit refund | - | 667,460 |
Adjust opening deferred tax to average rate of 19.00% | - | (353,868 | ) |
Deferred tax not recognised | 5,717,729 | 6,498,649 |
Fixed asset differences | (11,267 | ) | (8,151 | ) |
Non-deductible share based payment charge | 411,200 | 989,468 |
Difference in tax rate | - | (1,633,195 | ) |
RDEC repayment adjustment | 242,197 | - |
Total tax charge/(credit) | 214,722 | (2,406,082 | ) |
Tax effects relating to effects of other comprehensive income |
1.4.23 to 31.12.23 |
Gross | Tax | Net |
£ | £ | £ |
Foreign exchange | 1,021,541 | - | 1,021,541 |
31.3.23 |
Gross | Tax | Net |
£ | £ | £ |
Foreign exchange | (618,460 | ) | - | (618,460 | ) |
8. | INDIVIDUAL INCOME STATEMENT |
As permitted by Section 408 of the Companies Act 2006, the Income Statement of the parent company is not presented as part of these financial statements. |
Tessian Limited (Registered number: 08358482) |
Notes to the Consolidated Financial Statements - continued |
for the Period 1 April 2023 to 31 December 2023 |
9. | TANGIBLE FIXED ASSETS |
Group |
Plant and | Computer |
machinery | equipment | Totals |
£ | £ | £ |
COST |
At 1 April 2023 | 127,718 | 783,317 | 911,035 |
Additions | - | 6,670 | 6,670 |
Disposals | - | (50,779 | ) | (50,779 | ) |
At 31 December 2023 | 127,718 | 739,208 | 866,926 |
DEPRECIATION |
At 1 April 2023 | 101,469 | 410,734 | 512,203 |
Charge for period | 10,210 | 152,964 | 163,174 |
Eliminated on disposal | - | (38,468 | ) | (38,468 | ) |
At 31 December 2023 | 111,679 | 525,230 | 636,909 |
NET BOOK VALUE |
At 31 December 2023 | 16,039 | 213,978 | 230,017 |
At 31 March 2023 | 26,249 | 372,583 | 398,832 |
No impairment provision has been recognised in the year. |
Company |
Plant and | Computer |
machinery | equipment | Totals |
£ | £ | £ |
COST |
At 1 April 2023 |
Additions |
Disposals | ( |
) | ( |
) |
At 31 December 2023 |
DEPRECIATION |
At 1 April 2023 |
Charge for period |
Eliminated on disposal | ( |
) | ( |
) |
At 31 December 2023 |
NET BOOK VALUE |
At 31 December 2023 |
At 31 March 2023 |
Tessian Limited (Registered number: 08358482) |
Notes to the Consolidated Financial Statements - continued |
for the Period 1 April 2023 to 31 December 2023 |
10. | FIXED ASSET INVESTMENTS |
Company |
Shares in |
group |
undertakings |
£ |
COST |
At 1 April 2023 |
Additions |
Impairments | ( |
) |
At 31 December 2023 |
NET BOOK VALUE |
At 31 December 2023 |
At 31 March 2023 |
Subsidiary undertaking |
The following was a subsidiary undertaking of the company |
Name | Registered office | Principal activity | Class of shares | % Held Direct |
Tessian Inc |
14 Beacon Street, Boston, MA 02108 |
Cloud email security platform that intelligently protects organisations against advanced attacks and data loss on email, while coaching people about security threats in-the-moment |
Ordinary |
100 |
The aggregate of the share capital and reserves as at 31 December 2023 and the profit or loss for the period ended on that date for the subsidiary undertaking was as follows: |
Name | (Loss | ) |
Tessian Inc | (10,990,546 | ) |
11. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
Group | Company |
31.12.23 | 31.3.23 | 31.12.23 | 31.3.23 |
£ | £ | £ | £ |
Trade debtors | 5,993,441 | 5,189,371 |
Amounts owed by group undertakings | - | - |
Other debtors | 194,145 | 2,336,069 |
Tax | 726,590 | - |
VAT | 60,048 | - |
Prepayments | 2,153,606 | 2,636,530 |
9,127,830 | 10,161,970 |
Tessian Limited (Registered number: 08358482) |
Notes to the Consolidated Financial Statements - continued |
for the Period 1 April 2023 to 31 December 2023 |
12. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
Group | Company |
31.12.23 | 31.3.23 | 31.12.23 | 31.3.23 |
£ | £ | £ | £ |
Trade creditors | 2,375,664 | 1,756,527 |
Tax | 4,355 | 208 |
Social security and other taxes | - | 547,517 |
Other creditors | 356,134 | 125,575 |
Accruals and deferred income | 22,016,966 | 21,408,620 |
24,753,119 | 23,838,447 |
13. | CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR |
Group |
31.12.23 | 31.3.23 |
£ | £ |
Other loans (see note 14) | - | 19,351,951 |
Included within creditors due after more than one year in prior period is a loan for principal amount of $25,000,000. The term of the loan is over 5 years at 8% + SOFR variable interest. The business has applied an effective rate of interest to the loan. |
The loan was recognised on 15 March 2023 and associated arrangement fees of $1,014,038 were recognised. This was repaid in full during the financial period to 31 December 2023. |
14. | LOANS |
An analysis of the maturity of loans is given below: |
Group |
31.12.23 | 31.3.23 |
£ | £ |
Amounts falling due between one and two years: |
Other loans - 1-2 years | - | 19,351,951 |
15. | LEASING AGREEMENTS |
Minimum lease payments fall due as follows: |
Group |
Non-cancellable operating | leases |
31.12.23 | 31.3.23 |
£ | £ |
Within one year | 566,358 | 927,454 |
Between one and five years | 264,146 | 569,983 |
830,504 | 1,497,437 |
Tessian Limited (Registered number: 08358482) |
Notes to the Consolidated Financial Statements - continued |
for the Period 1 April 2023 to 31 December 2023 |
16. | FINANCIAL INSTRUMENTS |
Group | Group |
31.12.2023 | 31.03.2023 |
£ | £ |
FINANCIAL ASSETS |
Financial assets measured at fair value through profit and loss | 14,188,348 | 50,231,256 |
Financial assets that are debt instruments measured at amortised cost | 6,187,586 | 7,525,440 |
10,584,358 | 57,756,696 |
FINANCIAL LIABILITIES |
Financial liabilities measured at amortised cost | (4,067,493 | ) | (23,873,859 | ) |
Company | Company |
31.12.2023 | 31.03.2023 |
£ | £ |
FINANCIAL ASSETS |
Financial assets measured at fair value through profit and loss | 13,864,082 | 29,085,991 |
Financial assets that are debt instruments measured at amortised cost | 36,187,876 | 35,795,799 |
50,051,958 | 64,881,790 |
FINANCIAL LIABILITIES |
Financial liabilities measured at amortised cost | (3,522,297 | ) | (3,518,499 | ) |
Financial assets measured at amortised cost comprise trade debtors, amounts owed by group undertakings (where applicable), other debtors and accrued income. |
Financial assets measured at fair value through the profit and loss comprise of cash and cash equivalents. |
Financial liabilities measured at amortised cost comprise bank and other loans (including finance leases), overdrafts, trade creditors, other creditors, amounts owed to group undertakings and accruals. |
17. | PROVISIONS FOR LIABILITIES |
Group | Company |
31.12.23 | 31.3.23 | 31.12.23 | 31.3.23 |
£ | £ | £ | £ |
Deferred tax | 35,560 | 79,193 | 35,560 | 79,193 |
Group |
Deferred |
tax |
£ |
Balance at 1 April 2023 | 79,193 |
Credit to Income Statement during period | (43,633 | ) |
Balance at 31 December 2023 | 35,560 |
Tessian Limited (Registered number: 08358482) |
Notes to the Consolidated Financial Statements - continued |
for the Period 1 April 2023 to 31 December 2023 |
17. | PROVISIONS FOR LIABILITIES - continued |
Company |
Deferred |
tax |
£ |
Balance at 1 April 2023 |
Credit to Income Statement during period | ( |
) |
Balance at 31 December 2023 |
18. | CALLED UP SHARE CAPITAL |
31 December 2023 |
31 March 2023 |
£ | £ |
Alloted, called up and fully paid |
72,998,560 (31 March 2023: 25,095,701) Ordinary shares of £0.00004 each | 2,920 | 1,004 |
0 (31 March 2023 242,875) A Ordinary shares of £0.00004 each | 0 | 10 |
0 (31 March 2023 11,657,875) A Preferred shares of £0.00004 each | 0 | 466 |
0 (31 March 2023 17,714,450) B Preferred shares of £0.00004 each | 0 | 709 |
0 (31 March 2023 8,898,625) Seed Preferred shares of £0.00004 each | 0 | 356 |
13,961,892 C Preferred shares of £0.00004 each | 558 | 558 |
3,478 | 3,103 |
On 19 December 2023 A Ordinary shares, A Preferred shares, B Preferred shares and Seed Preferred shares were all re-designated to Ordinary shares. |
In accordance with the Company's Employee Share Option Plan: |
On 10 May 2023 72,099 £0.00004 Ordinary shares were issued for consideration of £26,425. The premium of £26,422 has been credited to the share premium account. The aggregate nominal value for this is £3. |
On 14 September 2023 173,179 £0.00004 Ordinary shares were issued for consideration of £66,591. The premium of £66,584 has been credited to the share premium account. The aggregate nominal value for this is £7. |
On 14 December 2023 554,115 £0.00004 Ordinary shares were issued for consideration of £296,683. The premium of £296,661 has been credited to the share premium account. The aggregate nominal value for this is £22. |
On 19 December 2023 8,649,311 £0.00004 Ordinary shares were issued for consideration of £5,313,636. The premium of £5,313,291 has been credited to the share premium account. The aggregate nominal value for this is £346. |
Rights, preferences and restrictions |
Seed shares, A Ordinary shares, A Preferred shares, B Preferred shares & C Preferred shares (collectively "Preferred shares") and Ordinary shares confer on each holder the right to receive notice of and to attend, speak and vote at all generate meetings of the Company and to receive and vote on proposed written resolutions of the Company. Preferred shares and Ordinary shares have the right to receive dividends from available profits in the Company which are split pro-rata according to the shareholders' holding. |
Deferred shares have no rights or dividend rights attached to them. The articles, provide for deferred shares however there were no deferred shares in issue in this, or prior, financial years. |
On liquidation or return of capital any net proceeds shall be distributed in the following order: firstly to Deferred shareholders who between all Deferred shares receive a total of £1.00; secondly to Preferred shareholders until they have received an amount equal to the subscription price plus £250, divided by the total Preferred shares in issuance; and thirdly to Ordinary shares who receive 0.0001% of net proceeds. Any remaining assets thereafter will be distributed as at 0.0001% to the holders of Preferred shares and Ordinary shares. |
Tessian Limited (Registered number: 08358482) |
Notes to the Consolidated Financial Statements - continued |
for the Period 1 April 2023 to 31 December 2023 |
19. | RESERVES |
Group |
Share |
Foreign | based |
Retained | Share | exchange | payment |
earnings | premium | reserve | reserve | Totals |
£ | £ | £ | £ | £ |
At 1 April 2023 | (92,241,286 | ) | 95,169,414 | (888,812 | ) | 15,480,048 | 17,519,364 |
Deficit for the period | (28,203,693 | ) | (28,203,693 | ) |
Cash share issue | - | 5,649,185 | - | - | 5,649,185 |
Foreign exchange | - | - | 1,021,541 | - | 1,021,541 |
Share based payment movement | - | - | - | 2,767,641 | 2,767,641 |
Share based payment transfer | 18,247,689 | - | - | (18,247,689 | ) | - |
At 31 December 2023 | (102,197,290 | ) | 100,818,599 | 132,729 | - | (1,245,962 | ) |
Company |
Share |
based |
Retained | Share | payment |
earnings | premium | reserve | Totals |
£ | £ | £ | £ |
At 1 April 2023 | ( |
) | 56,132,243 |
Deficit for the period | ( |
) | ( |
) |
Cash share issue | - | 5,649,185 | - | 5,649,185 |
Share based payment movement | - | - | 2,760,058 | 2,760,058 |
Share based payment transfer | 18,247,689 | - | (18,247,689 | ) | - |
At 31 December 2023 | ( |
) | 32,357,229 |
Share premium account |
The share premium account is used to record the aggregate amount or value of premiums paid when the Company's shares are issued at an amount in excess of nominal value. |
Capital redemption reserve |
This reserve relates to the fair value of the options granted which has been charged to the profit and loss account over the vesting period of the options. |
Foreign exchange reserve |
The foreign exchange reserve represents the cumulative movements in foreign exchange. |
Profit and loss account |
This reserve relates to the cumulative retained earnings less amounts distributed to shareholders. |
20. | PENSION COMMITMENTS |
The group operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the group to the scheme and amounted to £1,047,917 (2023: £1,757,761). Contributions totalling £121,645 (2023: £113,641) were payable to the fund at the balance sheet date. |
21. | RELATED PARTY DISCLOSURES |
During the year the company provided services of £25,473 (31 March 2023: £56,803) to a company with a common director, of which £Nil was outstanding at the (31 March 2023: £60,495). |
Tessian Limited (Registered number: 08358482) |
Notes to the Consolidated Financial Statements - continued |
for the Period 1 April 2023 to 31 December 2023 |
Key management personnel comprises of the directors. Details of directors' remuneration are given in note 4 of the financial statements |
22. | POST BALANCE SHEET EVENTS |
Following the balance sheet date, but before the date of approval of these financial statements Tessian Limited has provided Tessian Inc, a wholly owned subsidiary of Tessian Limited, with debt relief to the value of $10.6 million. Further more Tessian Inc was sold to Proofpoint Inc and commenced liquidation in October 2024. Both these events are considered non-adjusting subsequent events as no evidence existed on 31 December 2023 that these events would occur, and as such no financial information has been adjusted within the financial statements. |
23. | ULTIMATE CONTROLLING PARTY |
The directors consider the immediate parent company to be Proofpoint International, Inc, a company incorporated and duly organised under the laws of the state of Delaware, USA, with a registered office of 925 W. Maude Avenue, Sunnyvale, CA 94085. |
These financial statements are the smallest group for which consolidated financial statements are prepared. |
Proofpoint, Inc is the largest group for which consolidated financial statements are prepared which includes the results of Proofpoint Limited. Proofpoint, Inc. is, a company incorporated and duly organised under the laws of the state of Delaware, USA. with a registered office of 925 W. Maude Avenue, Sunnyvale, CA 94085. |
The ultimate parent company is Thoma Bravo, LLC, a company incorporated in the United States of America. |
The directors do not consider there to be an ultimate controlling party. |
Tessian Limited (Registered number: 08358482) |
Notes to the Consolidated Financial Statements - continued |
for the Period 1 April 2023 to 31 December 2023 |
24. | SHARE-BASED PAYMENT TRANSACTIONS |
The table below represents the share options in force (whether or not registered with HMRC as at 31 December 2023, that are expected to be exercised. The group granted these to certain employees of the group under an approved EMI option plan registered with HMRC and an ISO scheme with a 409A valuation. |
Weighted average exercise price (pence |
) |
Number |
Weighted average exercise price (pence |
) |
Number |
31 December 2023 |
31 December 2023 |
31 March 2023 |
31 March 2023 |
Outstanding at the beginning of the year | 63.05 | 11,886,976 | 67.2 | 7,803,,157 |
Granted during the year | 24.15 | 88,850 | 59.29 | 7,338,159 |
Exercised during the year | 48.89 | (795,745 | ) | 77.31 | (2,647,773 | ) |
Forfeited during the year | 63.50 | (11,180,081 | ) | 30.39 | (606,567 | ) |
Outstanding at the end of the year | 0 | £0 | 63.05 | 11,886,976 |
All options granted have performance conditions relating to the relevant employee remaining in the employment of the company at the vesting date. The option vesting period for options granted is 25% vest on the one year anniversary of grant and one forty-eighth (1/48th) vest each month thereafter, on the same day of the month as the vesting commencement date, until the remaining 75% of the option shares have vested. Or the vesting schedule is one thirty sixth (1/36) vest each month from the date of grant, on the same day of the month as the vesting commencement date, until all option shares have vested. It not exercised the share options will lapse 90 days after a sale or exit event, or on the tenth anniversary of the date of the grant. Unvested share options will lapse where an employee leaves the Company subject to the directors' discretion. |
The group is unable to directly measure the fair value of employee services received. Instead the fair value of the share options granted during the year is determined using the Black-Scholes model. The model is internationally recognised as being appropriate to value employee share schemes similar to the All-employee and Key-employee schemes. |
Share options are exercisable at a price determined through each individual option agreement. Options are exercisable in either the event of a sale or listing of the company or if the employee meets the requirement of a "good leaver". When exercised the share options are settled in equity. If the options remain unexercised after a period of 10 years from the date of grant, the options expire. Vested share options will lapse 60 days after an employee leaves the company and unvested share options will lapse immediately upon leaving employment, subject to the directors' discretion. |
Below is the total expense in relation to the equity settled schemes which has been recognised in the statement of profit or loss for the period. |
31 December 2023 |
31 March 2023 |
£ | £ |
Equity-settled schemes | 2,760,059 | 8,600,456 |