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ZILO TECHNOLOGY LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2024
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At 1 January 2023 (Unaudited)
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Shares issued during the year
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Shares issued during the year
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Page 14
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ZILO TECHNOLOGY LIMITED
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2024
Cash flows from operating activities
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Loss for the financial year
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Depreciation of tangible assets
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Loss on disposal of tangible assets
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Decrease/(increase) in debtors
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(Decrease)/increase in creditors
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Share-based incentive scheme accrual
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Net cash generated from operating activities
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Cash flows from investing activities
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Purchase of tangible fixed assets
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Net cash from investing activities
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Cash flows from financing activities
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Movement in fundraising activities
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Net cash used in financing activities
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Net (decrease)/increase in cash and cash equivalents
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Cash and cash equivalents at beginning of year
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Cash and cash equivalents at the end of year
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Cash and cash equivalents at the end of year comprise:
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The notes on pages 16 to 35 form part of these financial statements.
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Page 15
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ZILO TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
ZILO Technology Limited ("the Company") is a private company limited by shares, registered and incorporated in England and Wales. Company registered number 12564726 .
The address of its registered office is disclosed on the Company information page.
The principal activity of the Group is set out on page 1.
These financial statements are presented in Pounds Sterling (£). This is the functional currency of the Company and the currency of the primary economic environment in which it operates. The Group has chosen Pounds Sterling as its presentation currency.
Monetary amounts included in these financial statements are rounded to the nearest whole £.
2.Accounting policies
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Basis of preparation of financial statements
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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 comparative information presented in the Consolidated Statement of Comprehensive Income, Consolidated Statement of Financial Position, Consolidated Statement of Changes in Equity, Consolidated Statement of Cash Flows, and the accompanying notes is unaudited. This is because, for the year ended 31 December 2023, the Group relied on the exemption available under section 399 of the Companies Act 2006 and did not prepare consolidated financial statements for that year.
The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of Comprehensive Income in these financial statements.
The following principal accounting policies have been applied:
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Financial Reporting Standard 102 - reduced disclosure exemptions
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The Company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this Company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group.
The Company has therefore taken advantage of exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements:
∙Section 7 'Statement of Cash Flows': Presentation of a statement of cash flow and related notes
∙Section 11 'Basic Financial Instruments': Interest income/expense and net gains/losses for each category of financial instrument;
∙Section 26 'Share based Payment': Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements
Page 16
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ZILO TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
∙Section 33 'Related Party Disclosures': Compensation for key management personnel
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 Directors have reviewed the Group’s budgets and cash flow forecasts and having considered the current trading position and available funding, are satisfied that the going concern basis of preparation remains appropriate.
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Foreign currency translation
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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 profit or loss.
On consolidation, the results of overseas operations are translated into Pound Sterling at average rates of exchange. This approximates the actual spot rates of exchange on the dates that 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 the aforementioned translations are recognised in other comprehensive income.
Page 17
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ZILO TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:
Rendering of services
Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
∙the amount of revenue can be measured reliably;
∙it is probable that the Group will receive the consideration due under the contract;
∙the stage of completion of the contract at the end of the reporting period can be measured reliably; and
∙the costs incurred and the costs to complete the contract can be measured reliably.
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Operating leases: the Group as a lessee
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Rental amounts relating to the period in respect of operating lease contracts are charged to profit or loss on a straight-line basis over the lease term.
The lease term is the non-cancellable period for which the lessee has contracted to lease the assets together with the optional renewal term, when at the inception of the lease it is reasonably certain that the Group as lessee will exercise the option.
Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight-line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.
In the research phase of an internal project it is not possible to demonstrate that the project will generate future economic benefits and hence all expenditure on research shall be recognised as an expense when it is incurred.
Accounting policies allow intangible assets to be recognised from the development phase of a project if certain specific criteria are met in order to demonstrate the asset will generate probable future economic benefits and that its cost can be reliably measured, with the capitalised development costs being subsequently amortised on a straight-line basis. However, given the stage the company is at, the Directors believe it is most appropriate at this time to deem all development expenditure to be research and charge as an expense to the profit and loss account
Interest income is recognised in profit or loss using the using the accruals basis and in accordance with actual interest earned.
Page 18
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ZILO TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
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.
Defined contribution pension plan
The Group operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity. Once the contributions have been paid the Group has no further payment obligations.
The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of Financial Position. The assets of the plan are held separately from the Group in independently administered funds.
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. 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.
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.
Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the Company and the Group operate and generate income.
Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the reporting date, except that:
∙The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits;
∙Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met; and
∙Where they relate to timing differences in respect of interests in subsidiaries, associates, branches and joint ventures and the Group can control the reversal of the timing differences and such reversal is not considered probable in the foreseeable future.
Page 19
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ZILO TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.
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.
The estimated useful lives range as follows:
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.
In the Company's financial statements, investments in subsidiaries are measured at cost less accumulated impairment.
Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.
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Cash and cash equivalents
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Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.
Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.
Page 20
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ZILO TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
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Provisions for liabilities
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Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable and a reliable estimate can be made.
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
Deferred tax liabilities are also presented within provisions but are measured in accordance with the accounting policy on taxation.
Increases in provisions are generally charged as an expense to profit or loss.
The Group and Company has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the Group's Statement of Financial Position when the Group becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with 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.
Basic financial assets
Basic financial assets, which include trade and other debtors, cash and bank balances, are initially measured at their transaction price (adjusted for transaction costs) and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, 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.
Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.
Discounting is omitted where the effect of discounting is immaterial. The Group's cash and cash equivalents, trade and most other debtors due with the operating cycle fall into this category of financial instruments.
Basic 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 the deduction of all its liabilities.
Basic financial liabilities, which include trade and other creditors, bank loans, other loans and loans due to fellow group companies are initially measured at their transaction price (adjusting for transaction costs). When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future payments discounted at a market rate of interest, discounting is omitted where the effect of discounting is immaterial.
Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.
Page 21
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ZILO TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
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Financial instruments (continued)
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Trade creditors are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade creditors are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities.
Equity instruments issued by the Company 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 Company.
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Judgments in applying accounting policies and key sources of estimation uncertainty
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In applying the Group's and the Company's accounting policies, the Directors are required to make judgements, estimates and assumptions in determining the carrying amounts of assets and liabilities. The Directors' judgements, estimates and assumptions are based on the best and most reliable evidence available at the time when the decisions are made, and are based on historical experience and other factors that are considered to be applicable. Due to the inherent subjectivity involved in making such judgements, estimates and assumptions, the actual results may differ.
Critical judgements in applying the Group and Company's accounting policies
There are no critical accounting judgements that would have a significant effect on the amounts recognised in the Group's and Company's financial statements.
Key assumptions and sources of estimation uncertainty
The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are described below. The Group and Company based its assumptions and estimates on parameters available when the financial statements were prepared.
Existing circumstances and assumptions about future developments, however, may change due to market changes or circumstances arising that are beyond the control of the Group and Company. Such changes are reflected in the assumptions when they occur.
Share based payment costs
Estimating the fair value for share-based payment transactions requires determination of the most appropriate valuation model, which depends on the terms and conditions of the grant. This estimate also requires determination of the most appropriate inputs to the valuation model including the expected life of the share option, volatility and the risk-free rate and making assumptions about them. The Group initially measures the fair value of equity-settled transactions with employees at the grant date using the Black-Scholes model. The assumptions used for estimating the fair value for share-based payment transactions are disclosed in note 22.
Page 22
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ZILO TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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An analysis of turnover by class of business is as follows:
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All turnover arose within the United Kingdom.
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Research and development income
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The operating loss is stated after charging:
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During the year, the Group obtained the following services from the Company's auditors:
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Fees payable to the Company's auditors in respect of:
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the audit of the consolidated and parent company's financial statements
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The Company has taken advantage of the exemption not to disclose amounts paid for non-audit services as these are disclosed in the consolidated numbers presented above.
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Page 23
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ZILO TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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Staff costs, including Directors' remuneration, were as follows:
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Cost of defined contribution scheme
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The average monthly number of Group employees, including the Directors, during the year was 130 (2023 - 69).
The average monthly number of Company employees, including the Directors, during the year was 87 (2023 - 53).
The long-term benefit represents the Group's obligations in respect of the employees of ZILO Asia when they reach a retirement age. Refer to note 19 for further details.
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Group contributions to defined contribution pension schemes
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During the year retirement benefits were accruing to no Directors (2023 - NIL) in respect of defined contribution pension schemes.
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The highest paid Director received remuneration of £259,527 (2023 - £151,506).
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The value of the Group's contributions paid to a defined benefit pension scheme in respect of the highest paid Director amounted to £7,500 (2023 - £3,750).
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The Directors are considered to be the key management personnel of the Company and Group.
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Page 24
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ZILO TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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Interest payable and similar expenses
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Directors' loan interest payable
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Adjustments in respect of previous periods
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Foreign tax on income for the year
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Page 25
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ZILO TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
12.Taxation (continued)
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Factors affecting tax charge for the year
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The tax assessed for the year is higher than (2023 - higher than) the standard rate of corporation tax in the UK of25% (2023 -23%). The differences are explained below:
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Loss on ordinary activities before tax
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Loss on ordinary activities multiplied by standard rate of corporation tax
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Expenses not deductible for tax purposes
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Adjustments to tax charge in respect
of previous periods
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Movement in deferred tax not
recognised
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Total tax charge for the year
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The Group has accumulated tax losses of £29,445,333 (2023 - £17,687,060), for which no deferred tax asset has been recognised. These losses do not expire under current UK tax legislation.
Management will continue to assess the recoverability of these losses in future periods and recognise a deferred tax asset when it becomes probable that taxable profits will arise.
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Factors that may affect future tax charges
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There were no factors that may affect future tax charges.
Page 26
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ZILO TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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At 1 January 2024 (unaudited)
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At 1 January 2024 (unaudited)
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At 31 December 2023 (unaudited)
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Page 27
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ZILO TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
13.Tangible fixed assets (continued)
Page 28
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ZILO TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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Investments in subsidiary companies
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The following were subsidiary undertakings of the Company:
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88 Ratchadaphisek Road 7-8 Floor The Park Building, Khlong toei, Bangkok, IO110 Thailand
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First Floor, 5 Fleet Place, London, United Kingdom EC4M 7RD
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First Floor, 5 Fleet Place, London, United Kingdom EC4M 7RD
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All subsidiaries are held directly by ZILO Technology Limited.
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Page 29
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ZILO TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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Due after more than one year
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Amounts owed by group undertakings
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Amounts owed by group undertakings are unsecured, interest free and repayable on demand.
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Cash and cash equivalents
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Page 30
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ZILO TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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Creditors: Amounts falling due within one year
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Amounts owed to group companies
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Other taxation and social security
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Accruals and deferred income
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Amounts owed by group undertakings are unsecured, interest free and repayable on demand.
Amounts from fundraising relates to Series A shares which were issued on 3rd January 2024. Refer to note 20.
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Financial assets measured at amortised cost
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Financial liabilities measured at amortised cost
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Financial assets measured at amortised cost comprise of cash and cash equivalents and all debtors except prepayments and amounts due in relation to tax.
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Financial liabilities measured at amortised cost comprise of all creditors except accruals, deferred income and amounts owed in relation to tax and social security.
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Page 31
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ZILO TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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Non - current provision for employee benefits
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At 1 January 2024 (unaudited)
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Foreign exchange movement
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The provision for long-term employee benefit represent the Group's obligations payable to its employees when they reach a retirement age. They are determined based on the employee's age, length of employment service and salary increase rate, among other things.
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Shares classified as equity
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Allotted, called up and fully paid
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341,431 (2023 - 349,264) Ordinary shares of £0.0001 each
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211,604 (2023 - NIL) Series A shares of £0.0001 each
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Page 32
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ZILO TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Share premium account
The Share premium account represents the excess consideration over the nominal value of shares.
Foreign exchange reserve
Foreign exchange reserve includes the translation differences arising from the translation of the financial statements of the Group's foreign subsidiaries into GBP.
Other reserves
The share-based payment reserve represents the cumulative fair value of equity-settled share-based payment transactions.
Profit and loss account
The Profit and loss account represents the cumulative profits and losses of the Group after the payment of dividends.
Page 33
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ZILO TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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The total expense recognised by the Group in profit and loss in the year in respect of share-based payments was £1,798,496 (2023 - £Nil).
The Group introduced an equity-settled employee share option plan, under which options have been granted to individuals at an exercise price equal to an agreed price of the Company's shares on the date of the grant. The shares typically vest quarterly over five years from the grant date. Certain grants have accelerated vesting terms such that award vesting will complete across the 2024 to 2028 years.
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Weighted average exercise price (pence)
2024
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Outstanding at the beginning of the year
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Forfeited during the year
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Outstanding at the end of the year
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At 31 December 2024 no options are exercisable.
The fair value of the options was determined using the Black-Scholes option pricing model, with the following assumptions:
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The Group is currently subject to an ongoing legal claim. Due to the stage and uncertainty of legal proceedings, the Directors are unable to reliably estimate the timing or financial effect of any potential outflows. Accordingly, no provision has been made in these financial statements. The Group has an active insurance policy in place, which covers legal claims of this nature, and will continue to operate for this claim up to the limit of cover.
Page 34
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ZILO TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
The Group operates defined contribution pension scheme. The assets of the scheme are held separately
from those of the Group, in independent administrative funds. The pension cost charge represents contributions payable by the Group to the funds and amounted to £297k (2023 - £61k). Contributions totaling £49k were payable at the balance sheet date (2023 - £26k).
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Commitments under operating leases
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At 31 December 2024 the Group and the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:
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Later than 1 year and not later than 5 years
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Related party transactions
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The Company and Group has taken the advantage of the exemption permitted by Section 33 Related Party Disclosures, not to provide disclosures of transactions entered into between two or more members
of a group that are wholly owned.
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Post balance sheet events
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Subsequent to the reporting date, the Group has finalised its Series A extension funding round, securing additional capital of £19.5m to support operations through 2025 and 2026, with the aim of achieving profitability.
Series A1 Shares will be issued at £152.28 per share. The initial close of £11m finalised on 14th July 2025 with final completion due by 30th September 2025.
The Directors do not deem there to be an individual controlling party.
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