Half-year Report

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014.

21 March 2017

MoneySwap plc

("Moneyswap" or the "Company")

Interim results for the six months ended 30 September 2016

MoneySwap (AIM: SWAP) announces the Company's unaudited results for the six months ended 30 September 2016 (the "Interim Results").

A copy of the Interim Results will shortly be made available on the Company's website, www.moneyswapholdings.com.

- Ends-

For further information, please contact:

About MoneySwap (www.moneyswap.com)

MoneySwap provides payment solutions and gateways to merchants, which allow both online and point of sale transactions to be settled using UnionPay cards in the UK. In addition, UnionPay has licensed MoneySwap for its MoneyExpress service, which enables overseas persons to send funds directly to UnionPay cardholders in China. The Company's shares are traded on the London Stock Exchange's AIM market (AIM: SWAP). More information can be found at www.moneyswap.com.

MONEYSWAP PLC

CHAIRMAN AND CHIEF EXECUTIVE OFFICER'S STATEMENT 

MoneySwap Plc. ("Moneyswap", the "Company" or the "Group") released its audited financial statements for the year ended 31 March 2016 at the same time as these unaudited statements for the six months ended 30 September 2016. Accordingly, in addition to summarizing the results for the six months ended 30 September 2016, I also set out below in full my report attached to the 31 March 2016 statements.

Total revenues in 6 months to 30 September 2016 were US$218,572 (6 months ended 30 September 2015: US$134,710) and gross profit was US$112,320 (6 months ended 30 September 2015: US$80,302). The loss for the period of US$961,142 was less than the loss incurred for the 6 months ended 30 September 2015 (being US$2.08 million). The reduction in the loss in the period was largely attributable to cost cutting, albeit revenues were substantially up in percentage terms on the equivalent prior year six month period.

CEO statement for the year ended 31 March 2016

The results for the year ended 31 March 2016 were disappointing; MoneySwap Plc ("Moneyswap", the "Company" or the "Group") did not make any significant progress in building its revenue base to a sustainable level, notwithstanding that revenues and gross profit increased substantially in percentage terms during the year. Total revenues in the year were US$397,056 (year ended 31 March 2015: US$162,602) and gross profit was US$178,728 (year ended 31 March 2015: US$99,938). The loss for the year of US$3.1 million was marginally less than the loss incurred for the year ended 31 March 2015 (being US$3.5 million). The losses reflect the fact that the fixed cost element of the Group's operations requires significantly more volume across the Group's platforms than has been achieved in order to generate profits.

Net liabilities at 31 March 2016 were US$2,034,967 (31 March 2016: US$2,781,677).

Current trading and financing

Since 31 March 2016 the Company has continued to suffer from insufficient working capital and significant cost reductions have been necessary. This in turn has impacted negatively on the ability of the Group to market its platforms and products and the Group continues to incur losses.

The Company has made a number of announcements in recent months updating shareholders on the Board's efforts to secure a substantial refinancing of the Group. Capital needs have been funded through a number of loans from related and unrelated parties, including Wraith Holdings B.V. ("Wraith" and the "Wraith Loan"). The Wraith principal is a USA-based investor with interests and experience in payment processing, payment card issuance and financial services.

The Company has today announced that it has entered into a subscription agreement with Wraith (the "Wraith Subscription Agreement"), pursuant to which Wraith has agreed to subscribe US$3.005 million through the issue of new ordinary shares in the Company. These new ordinary shares will represent approximately 67% of the enlarged share capital of the Company (the "Subscription"). In addition the Company has granted Wraith an option to subscribe for additional shares that would take Wraith's holding up to 75% of the fully diluted share capital at a price of GBP0.001 per share (which based on the current share capital) would result in Wraith paying a further US$1.414 million of subscription monies ("Option"). In the event that Wraith makes the full subscription including the Option it will come to own a maximum of 75% of the enlarged and fully diluted share capital. The subscription agreement is conditional inter alia, on: i) publication of these financial statements and the unaudited results for the six months ended 30 September 2016; ii) the receipt of a no objection letter from the Financial Conduct Authority; iii) the lifting of the current suspension of trading of the Company's shares (and depository interests) on AIM, the continued admission of the Company's trading on AIM and the continued engagement of Allenby Capital as the Company's nomad; and iv) the approval of the Company's shareholders of the Subscription and Option at a forthcoming General Meeting of the Company which will be convened for a date in April 2017.

As part of the agreements associated with the Wraith Subscription Agreement, at completion of the Subscription Wraith will acquire certain debt obligations of the Company totaling US$1.425 million which, together with the amounts outstanding under the Wraith Loan, will be set-off in part against the obligation to pay the subscription proceeds due under the Subscription.

The Board believes that it is likely that the conditions precedent to the Wraith Subscription will be met or waived by Wraith and that the subscription will proceed on the basis set out in the Wraith Subscription Agreement. This will allow the Group to be restored to a sound financial footing and to benefit from Wraith's plan for generating new and increased revenue streams using the existing Group platforms and products. However as of the date hereof the conditions precedent have not been met. In this regard I would draw your attention to the accounting policies note 2 in the financial statements and the auditors' reports on the financial statements. These reports contain an emphasis of matter as to the going concern basis on which these financial statements have been prepared.

Board changes

There have been a number of management changes at Board level. On 11 November 2015 Richard Proksa resigned as CEO (but remained as a director of the Company), Mr Kung-Min Lin assumed the role of Chairman and CEO and Ms Yu Shu Fen was appointed as an Executive Director. On 30 December 2015 Mr Proksa and Mr Lin stepped down as directors, Ms Yu assumed the role of CEO and I assumed the role as Chairman.

On 30 August 2016, subsequent to the year end, Ms Yu resigned as CEO and I assumed the role of Interim CEO in addition to my role as Chairman. Given the financial position of the Company it has not been possible to appoint a permanent CEO. Following the completion of the proposed subscription by Wraith it is intended that a new CEO will be appointed as soon as reasonably possible thereafter.

Suspension from trading on AIM

The Company's shares were suspended from trading on AIM on 21 September 2016 for failure to publish its audited financial statements for year ended 31 March 2016 within six months of the period end. In addition, the Company was required to publish its interim results for the six months ended 30 September 2016 prior to 31 December 2016. Following the publication of these 2016 Results, these suspension conditions have now been satisfied, however, the Company has been informed by its registrars that, as a result of unpaid fees due to the Company's working capital constraints, the depositary interest ("DI") facility put in place at the time of the Company's admission to trading on AIM has been cancelled. As the Company is incorporated in Gibraltar, its ordinary shares are not eligible for electronic settlement in the UK. The DIs were put in place in order to provide holders of ordinary shares with a mechanism of electronic settlement using the CREST system.

The AIM Rules for Companies require that all AIM Companies must ensure that their securities are eligible for electronic settlement. As a result, the Company's shares will remain suspended from trading on AIM until such time that the Company has put in place a replacement DI facility. The Company has been working with its registrars with regards to implementing a new DI facility and anticipates that this will be in place prior to the date of the extraordinary general meeting which is to be held on or about 19 April 2017. An update will be provided in due course.

In conclusion, whilst the financial results for the year ended 31 March 2016 and subsequent trading are totally unsatisfactory I believe that completion of the Wraith Subscriptions, its participation in the Company's governance process and its business development support will result in a brighter future. To get to this point after an extremely difficult period has required huge effort and support from various stakeholders; employees, shareholders, lenders and advisers and I am extremely grateful for all their efforts.

Craig Niven

Interim Chief Executive Officer

Date: 20 March 2017

CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME 

FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2016

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

AS AT 30 SEPTEMBER 2016

CONSOLIDATED STATEMENT OF CASH FLOWS

FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2016

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2016

1 Basis of preparation

The interim consolidated financial statements incorporate the results of MoneySwap Plc (the "Company") and entities controlled by the Company (its subsidiaries) (collectively the "Group").

The interim consolidated financial statements of the Group have been prepared in accordance with International Accounting Standard 34 Interim Financial Reporting and do not include all of the information required for full annual financial statements.

The interim consolidated financial statements are unaudited, do not constitute statutory accounts within the meaning of the accounting and audit provisions of the Gibraltar Companies Act 2014, and were approved by the Board of directors on 20 March 2017. The consolidated financial statements for the year ended 31 March 2016 were prepared under International Financial Reporting Standards ("IFRSs"). The auditors reported on the financial statements. Their report was unqualified and included reference to a matter to which the auditors drew attention by way of emphasis without qualifying their report.

The preparation of interim consolidated financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expenses. Actual results may differ from these estimates.

In preparing the interim consolidated financial statements, the significant judgements made by management in applying the Group's accounting policies and the key sources of estimation uncertainty were the same as those that were applied to the consolidated financial statements as at and for the year ended 31 March 2016.

The accounting policies applied by the Group in the interim consolidated financial statements comply with each IFRSs that is mandatory for accounting for the six months ended 30 September 2016. These policies are consistent with those adopted in the Group's consolidated financial statements for the year ended 31 March 2016 and those which will be adopted in the Group's consolidated financial statements for the year ending 31 March 2017.

The principal risks and uncertainties of the Group have not changed since the last annual financial statements where a detailed explanation of such risks and uncertainties can be found.

2 Segmental information

In the opinion of the directors, the Group has two business lines as described below, which are managed separately as they require different strategies:

- Merchant acquisition and remittance services for China UnionPay ("Merchant acquisition and remittance")

- Peer to peer foreign exchange and payment ("P2P")

For the Group's internal reporting process, operating performance for peer to peer foreign exchange and payment are assessed together and therefore, their segmental results are combined.

The directors consider that it is neither possible nor meaningful to distinguish aggregate amortisation and depreciation, other administrative and operating expenses and taxation between the business segments, nor segmental net assets and liabilities. As a result these amounts are not reported to the chief operating decision maker on a segmental basis.

The Group is organised around two main geographical areas and a split of the geographical segments is as follows:

The major changes in segment assets during the period mainly relate to the decrease in property and equipment and intangible assets for normal depreciation/amortisation.

3 Other income

4 Taxation

Taxation of the Company and its subsidiaries is recognised based on the rules and regulations of their respective countries of incorporation.

A deferred tax asset has not been recognised in respect of all tax losses available to carry forward against suitable future trading profits as the directors consider there is insufficient evidence that it is more likely than not all the assets will be recovered. These assets can be recovered against suitable future trading profits.

5 Loss per share

Basic loss per share has been calculated by dividing the net results attributable to ordinary shareholders by the weighted average number of shares in issue during the period/year.

Due to the Company and Group being loss making, the share options and convertible loan notes are anti-dilutive.

6 Property and equipment

During the six months ended 30 September 2016, the Group acquired assets with a cost of US$nil (six months ended 30 September 2015: US$3,300; year ended 31 March 2016: US$3,300).

7 Goodwill

The goodwill relates to the excess of consideration paid over the net assets acquired in MoneySwap Limited and MoneySwap FX Limited. The directors consider that it is neither possible nor meaningful to distinguish segmental net assets and liabilities between the business segments.

The goodwill is tested annually for impairment and the last goodwill impairment test was carried out as at 31 March 2016.

The directors have considered the carrying value of goodwill. In conducting their assessment they have considered the nature of the subscription agreement with Wraith for a significant investment by Wraith, by way of a subscription for new ordinary shares in the Company, which is expected will represent 75% of the Company's enlarged and fully diluted share capital.

As at 30 September 2016, the directors did not consider there to be any impairment in respect of the goodwill.

Movement in goodwill during the period/year is as follows:

8 Trade receivables

All trade receivables are denominated in Philippine Peso which are due upon billing. The ageing of trade receivables at the reporting date that were not impaired was as follows:

The directors believe that no impairment allowance is necessary in respect of the trade receivables and consider that the carrying amount as at 30 September 2016 of trade receivables approximates to their fair value.

9 Capital and reserves

Share capital and share premium