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UNIVERSAL PARTNERS LIMITED - Summarised audited financial statements for the period from 25 April 2016 (date of incorporation) to 30 June 2017

Release Date: 20/09/2017 14:00
Code(s): UPL     PDF:  
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Summarised audited financial statements for the period from 25 April 2016 (date of incorporation) to 30 June 2017

UNIVERSAL PARTNERS LIMITED
(Incorporated in the Republic of Mauritius)
(Registration number: 138035 C1/GBL)
SEM share code: UPL.N0000
JSE share code: UPL
ISIN: MU0526N00007
(“Universal Partners” or “the Company”)

SUMMARISED AUDITED FINANCIAL STATEMENTS FOR THE PERIOD FROM 25 APRIL 2016 (DATE OF INCORPORATION) TO 30 JUNE 2017


Universal Partners has a primary listing on the Official Market of the Stock Exchange of Mauritius Ltd
(“SEM”) and a secondary listing on the Alternative Exchange of the JSE Limited (“JSE”).

PRINCIPAL ACTIVITY

The principal activity of the Company is to hold investments in high quality, growth businesses across
Europe, with a particular focus on the United Kingdom (“UK”).

The Company’s primary objective is to achieve strong capital appreciation in Pounds Sterling over the
medium to long-term by investing in businesses that meet the investment criteria set out in the Company’s
investment policy.

BUSINESS REVIEW

Since its listing on the SEM on 8 August 2016 and the JSE on 11 August 2016, the Company has been
working closely with its investment advisor, ARGO Investment Managers (“ARGO”), to identify potential
investments that meet its investment criteria. ARGO has assessed over 60 potential investments to date,
and has in turn proposed a small number that meet the investment criteria to the Investment Committee of
the Company. Some of these have moved to completion stage.

On 28 April 2017, the Company entered into an agreement to invest in Dentex Healthcare Group Limited
(“Dentex”) for a total consideration of GBP 15 million.

GBP 4 million was invested upfront to subscribe for a 36% ordinary shareholding in Dentex. The Company
will also subscribe for up to GBP 11 million worth of convertible Loan Notes (“Loan Notes”) which
Dentex can draw down during an 18 month availability period, commencing on the closing date of the
ordinary equity subscription. The Company will have the right to convert the Loan Notes into ordinary
shares of Dentex which will enable the Company to increase its shareholding to up to 49% of the ordinary
equity.

Subsequent to the 30 June 2017, Dentex made a first draw down of GBP 3 million of the Loan Notes which
was utilised to acquire practices. The balance of the Loan Notes still available for draw down of GBP 8
million is expected to be utilised by 31 December 2017.

Dentex is a dental consolidation group operating in the UK with a unique clinician led partnership model
that encourages clinical excellence and growth in profitability. Dentex has the capacity to roll out and
support a substantial network of dental practices and they have strategically partnered with several leading
dentists, to invest in practices that deliver sustainable cash flow generation, predominantly in the growing
private dental market. Dentex’s acquisition activity is tracking the business plan and the company is
performing in line with expectations.

                                                  
ACQUISITIONS MADE AFTER THE FINANCIAL YEAR UNDER REVIEW

Subsequent to the reporting period, the Company made two additional investments, one being Propelair
and the second being YASA Limited (“YASA”).

Propelair

On 13 July 2017, the Company co-invested with Investec Investments UK Limited and paid GBP 1 million
for a 13% shareholding in Propelair. Based on the investment thesis and expected growth, the business may
require additional expansion capital which will enable Universal Partners to increase the quantum of funds
invested in the business, and also its proportionate shareholding. Universal Partners has a seat on the
Propelair Board, and will actively engage in growing the business and ultimately achieving its objective of
a shareholding of at least 25%.

Propelair is a leader in positive pressure flushing toilets. Their patented toilet uses a measured 1.5 litres of
water per flush, compared to 9 litres for an average toilet, and is further proven to deliver lower maintenance
costs, enhanced drain performance and a substantially improved washroom hygiene environment. Propelair
is enjoying increasing uptake from corporates and property owners who wish to substantially reduce their
water utilisation, maintenance costs and the contamination of clean water once introduced into the waste
water system. The units have been installed in UK retail outlets, offices, universities and hospitals, given
the ease of installation onto existing drainage systems. The units are also ideal for smaller diameter, or
lower performance, drainage systems.

It is estimated that 120 billion litres of clean, potable water are unnecessarily contaminated in Europe every
day, as a consequence of being flushed into the sewage system by less efficient toilets. This is equivalent
to draining Lake Geneva every 20 hours. Once the water is contaminated, it requires substantial energy and
processing to be restored to a potable state, only to be re-introduced into the sewage system again. The
Propelair unit substantially reduces the impact of flushing on the wastage of potable water, further reducing
cycle of waste water being re-processed into a potable state before again being contaminated.

Propelair currently only sells its products in the UK and the Company believes there are substantial
opportunities to introduce this proven technology into water poor regions. The Company believes
Propelair’s technology to be a crucial part of addressing the increasing scarcity of clean water resources,
by conserving water used whilst delivering enhanced sanitary performance, and the funds invested by
Universal Partners will assist in delivering this international export strategy.

YASA

On 18 August 2017, the Company concluded an agreement to subscribe for shares and invest an amount of
GBP 9.3 million in YASA. The Company subscribed for shares together with existing YASA shareholders,
and became the holder of 22% of the equity shares in YASA.

YASA is a manufacturer of highly differentiated electrical axial flux motors, generators and controllers and
was spun out from research undertaken at Oxford University by YASA founder and Chief Technology
Officer, Dr Tim Woolmer. YASA has commercialised its patented technology across a range of product
areas over the last 8 years, which allows it to manufacture a range of electric motors with superior
performance characteristics. In comparison to other technologies, YASA’s motors are smaller, lighter and
easier to manufacture and produce exceptionally high power and torque, as independently confirmed by a
premier European automotive engineering consultancy. In the automotive sector, YASA’s motors are well
suited to hybrid applications where limited space is available. Given the growing interest in hybrid and
electric powertrains as an alternative to using only internal combustion powertrains, Universal Partners
believes that YASA’s products offer a timely, appropriate and high performance solution to automotive
manufacturers. The applications in other industrial sectors are well suited to situations where a high power
density or torque are required, within a small footprint.
 
We believe this is an exciting business which has extraordinary growth potential, since the revolutionary
technology and applications, are well suited to meeting the challenges of reducing automotive carbon
emissions via introduction of enhanced hybrid drivetrains.

Other

ARGO has identified a pipeline of additional potential investment opportunities which are at various stages
of maturity. These opportunities are going through a rigorous and thorough due diligence prior to being
presented to the Company’s Investment Committee. Announcements regarding any successfully concluded
transactions will be forthcoming as they are completed.

For the period under review, revenue in the form of interest was earned from investing excess cash in
interest bearing fixed deposits for periods ranging from one month to six months. The interest earned from
these deposits amounted to GBP 388,066 for the period ended 30 June 2017. The invested funds will remain
in short-term fixed deposits, money market and NCD instruments until such time as they are required for
investments in accordance with the Company’s investment policy.

Management fees for the period ended 30 June 2017 amounted to GBP 574,171, incurred in terms of the
investment management agreement between the Company and ARGO. General and administrative
expenses amounting to GBP 364,175 and transaction costs of GBP 130,000 relating to the acquisition of
Dentex were incurred for the period ended 30 June 2017.

NET ASSET VALUE (“NAV”)

The NAV per share as at 30 June 2017 was GBP 0.984 (31 March 2017: GBP 0.987).

LOSS PER SHARE

The loss per share of GBP 0.0036 for the quarter ended 30 June 2017 and GBP 0.0092 for the period ended
30 June 2017 are based on the Company’s loss before tax of GBP 259,074 and GBP 665,999 for the quarter
ended 30 June 2017 and period ended 30 June 2017 respectively, based on 72,350,131 weighted average
number of shares in issue. Costs of GBP 0.0069 per share relating to the issue of shares were offset against
share capital for the period ended 30 June 2017.

DIVIDEND

No dividend has been declared for the period under review.

BASIS OF PREPARATION

The summarised audited financial statements for the period from 25 April 2016 (date of incorporation) to
30 June 2017 (“summarised audited financial statements”) have been prepared using accounting policies
consistent with International Financial Reporting Standards (“IFRS”) as issued by the International
Accounting Standards Board (“IASB”) and in accordance with International Accounting Standard (IAS)
34 – Interim Financial Reporting, the listing rules of the SEM, the Mauritian Securities Act 2005 and the
JSE Listings Requirements.

The accounting policies used in the preparation of the summarised audited results are consistent with those
of the previous financial statements.

The directors are not aware of any circumstances or matters arising subsequent to the period ended 30 June 2017 
that require any additional disclosure or adjustment to the financial statements.

AUDIT OPINION

Grant Thornton have issued an unmodified audit opinion on the Company’s audited financial statements
for the period from 25 April 2016 (date of incorporation) to 30 June 2017. These summarised audited
financial statements were approved by the Board of the Company on 19 September 2017.

By order of the Board


20 September 2017


Intercontinental Trust Limited
Company secretary


For further information please contact:

South African corporate advisor and JSE sponsor
Java Capital                                                                +27 11 722 3050

SEM authorised representative and sponsor
Perigeum Capital Ltd                                                        +230 402 0890

Company Secretary
Intercontinental Trust Limited                                              +230 403 0800


NOTES

Copies of these audited financial statements as well as copies of the statement of direct or indirect interest
of the Senior Officers of the Company pursuant to rule 8(2)(m) of the Securities (Disclosure of Obligations
of Reporting Issuers) Rules 2007 are available to the public upon request to the Company Secretary at the
Registered Office of the Company at c/o Intercontinental Trust Limited, Level 3 Alexander House, 35
Cybercity, Ebene 72201, Mauritius.

This announcement is issued pursuant to the JSE Listings Requirements, SEM Listing Rule 12.14 and
Section 88 of the Mauritian Securities Act 2005. The Board of Universal Partners accepts full responsibility
for the accuracy of the information in this announcement.

 
    ABRIDGED AUDITED STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2017

                                                 As at 30 June   As at 31 March
                                                          2017             2017
                                                     (Audited)      (Unaudited)
                                                          GBP              GBP
    Assets
    Non-current assets
    Investments                                     4,000,100                -

    Current assets
    Trade and other receivables                       107,454                -
    Cash and cash equivalents                      67,137,560        71,481,935
                                                   67,245,014        71,481,935

    Total assets                                   71,245,114        71,481,935

    Equity and Liabilities
    Equity
    Stated capital                                 71,847,164        71,847,164
    Accumulated loss                                (665,999)         (406,925)
    Total equity                                   71,181,165        71,440,239

    Current liabilities
    Trade and other payables                           63,949             41,696

    Total liabilities                                  63,949             41,696

    Total equity and liabilities                   71,245,114        71,481,935


 
    ABRIDGED AUDITED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME FOR THE PERIOD ENDED 30 JUNE 2017

                                                                                       Quarter
                                                                                                     Year ended
                                                                                          ended
                                                                                  As at 30 June    As at 30 June
                                                                                           2017             2017
                                                                                      (Audited)        (Audited)
                                                                                           GBP              GBP
    Revenue
    Interest income                                                                    112,002           388,066
    Other income                                                                        23,746            23,746
    Total revenue                                                                      135,748           411,812

    Expenditure
    Management fees                                                                   (172,224)        (574,171)
    Set up costs                                                                              -          (5,749)
    Transaction costs                                                                 (130,000)        (130,000)
    General and administrative expenses                                                (92,598)        (364,175)

    Operating loss                                                                    (259,074)        (662,283)

    Loss on disposal of financial assets at fair value through profit or loss #               -           (3,716)

    Loss before tax                                                                   (259,074)        (665,999)
    Tax expense                                                                               -                -
    Loss for the period                                                               (259,074)        (665,999)

    Other comprehensive income
    Items that will not be reclassified subsequently to profit and loss                       -               -
    Items that will be reclassified subsequently to profit and loss                           -               -

    Other comprehensive income for the period, net of tax                                     -               -

    Total comprehensive income for the period                                         (259,074)        (665,999)
    Basic and headline loss per share (pence)*                                            0.36             0.92



    # Prior to listing on the JSE AltX the Company acquired 5,200 shares in Electra Private Equity Plc, a company
    listed on the London Stock Exchange, for GBP 202,000. The investment was made prior to listing in order to satisfy
    certain of the JSE listing requirements. Shortly after listing on the AltX these shares were disposed of for GBP
    198,284, resulting in a loss on disposal of GBP 3,716.

    * The loss per share for the quarter ended 30 June 2017 and year ended 30 June 2017 are based on loss before tax
    of GBP 259,074 and GBP 665,999 for the Company respectively and the number of shares in issue of 72,350,131.

    There were no dilutive shares in issue. There were no reconciling items between the basic and headline loss per
    share.

 
    ABRIDGED AUDITED STATEMENT OF CHANGES IN EQUITY FOR THE PERIOD ENDED 30 JUNE 2017

                                                           Stated      Loss for the
                                                                                          Total
                                                          Capital           period
                                                            GBP               GBP          GBP


    At 25 April 2016 *
                                                              100                 -         100

    Issue of shares                                     72,350,031                -   72,350,031
    Share issue costs                                    (502,967)                -    (502,967)
    Transactions with shareholders                      71,847,164                -   71,847,164

    Loss for the period                                          -       (406,925)     (406,925)
    Other comprehensive income for the period                    -               -             -
    Total comprehensive income for the period                    -       (406,925)     (406,925)
    At 31 March 2017                                    71,847,164       (406,925)    71,440,239

    At 1 April 2017                                     71,847,164       (406,925)    71,440,239

    Loss for the period                                          -       (259,074)     (259,074)
    Other comprehensive income for the period                    -               -             -

    Total comprehensive income for the period                    -       (259,074)     (259,074)
    At 30 June 2017                                     71,847,164       (665,999)    71,181,165

    * At 25 April 2016, the Company issued 100 shares at GBP 1 each.


 
    ABRIDGED AUDITED STATEMENT OF CASH FLOWS FOR THE PERIOD ENDED 30 JUNE 2017

                                                                       Quarter ended      Year ended
                                                                        As at 30 June   As at 30 June
                                                                                 2017           2017
                                                                            (Audited)       (Audited)
                                                                                 GBP             GBP
    Operating activities
    Loss before tax                                                         (259,074)       (665,999)
    Adjustments for:

    Loss from financial assets at fair value through profit and loss                -           3,716
    Foreign exchange differences                                                (190)          47,599
    Interest income                                                         (112,002)       (388,066)

    Changes in working capital:
    Increase in trade and other receivables                                  (27,454)        (27,454)
    Increase in trade and other payables                                       22,253          63,949
    Net cash flows generated from operating activities                      (376,467)       (966,255)

    Investing activities
    Acquisition of investments                                            (4,000,100)     (4,200,100)
    Proceeds of disposal of investments                                             -        196,284
    Interest received                                                         112,002        388,066
    Loans advanced                                                           (80,000)        (80,000)
    Net cash flows used in investing activities                           (3,968,098)     (3,695,750)

    Financing activities
    Proceeds from issue of shares                                                   -     72,350,131
    Share issue costs                                                               -      (502,967)
    Net cash flows generated from financing activities                              -     71,847,164

    Net change in cash and cash equivalents                               (4,344,565)     67,185,159
    Cash and cash equivalents at the beginning of the period               71,481,935              -
    Exchange rate differences                                                     190       (47,599)
    Cash and cash equivalents at the end of the period                     67,137,560     67,137,560


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