Preliminary Results for the year to 30 April 2014

TUNGSTEN CORPORATION PLC

("Tungsten" or collectively the "Tungsten Group")

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, IN, INTO OR FROM THE UNITED STATES, CANADA, AUSTRALIA, JAPAN NOR ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION

For Immediate Release

PRELIMINARY RESULTS FOR THE FINANCIAL YEAR ENDED

30th APRIL 2014

Listed on AIM and raised £160m of gross new money

Acquired e-Invoicing network OB10, rebranded as Tungsten Network

Obtained regulatory approval and completed the acquisition of Tungsten Bank

Completed the development of Tungsten Network Analytics

Pro-forma Tungsten Network revenue growth of 11%

Investment to prepare for network growth and launch of supply chain finance and spend analytics in FY2015

LONDON - Tungsten Corporation plc (Tungsten) (LSE: TUNG), the global electronic trading network focused on monetising the world's supply chain, has announced its results for the financial year ended 30th April 2014 ("FY2014").

Operational highlights

· 55% of Fortune 500 and 67% of FTSE 100 now being served by Tungsten Network 

· 20% growth in e-Invoicing: $152bn of e-Invoices processed in FY2014, compared to $126bn in the prior year 

· Focus on long-term Tungsten Network growth:

o Signed a net eight new buyers to Tungsten Network since acquisition, including recent additions of GE and Caterpillar

o Moving buyers to pure digital invoicing: Fall in 'paper' invoice data capture (IDC) transactions to $35bn in FY2014 from over $48bn in prior year

o Increase to 46 countries where Tungsten Network offers legal and tax compliant e-Invoicing 

· Over 168,000 suppliers now registered to use Tungsten Network 

· Tungsten Network Analytics invoice data repository now totals over $700bn 

· Key hires made across jurisdictions and business units including COO Lincoln Jopp; CEO of Americas Rick Hurwitz; and full Board and management team for Tungsten Bank

Business highlights

· Completed acquisition of OB10 Limited e-Invoicing platform, now renamed Tungsten Network Limited, for £73m in cash and £28m in equity in October 2013 

· In June 2014 post the period end, completed acquisition of fully authorised UK bank, FIBI Bank (UK) plc, now renamed Tungsten Bank plc, for total cash consideration of £29.3m 

· Creation of Tungsten Network Finance:

o Built an automated supply chain financing platform, integrated with Tungsten Network and financed the first invoices to selected suppliers

o Agreement with PNC to resell Tungsten to its customers

o Agreement with Alliance Data Systems to operate buyer-financed invoice discounting

o Co-operation with Blackstone Tactical Opportunities to finance international invoice discounting 

· Trialling Tungsten Network Analytics, our real-time spend analysis technology, with selected buyers

Financial highlights

· Admitted to AIM raising £160m of gross new money 

· Tungsten Network pro-forma full-year revenue of £19.5m (prior year £17.6m), an increase of 11% 

· Group net cash of £62.6m at 30th April 2014, prior to finalisation of acquisition and recapitalisation of Tungsten Bank in June 2014 (£30.1m cash outflow (consideration plus £5m capital injection), of which £25m is now restricted funds in the Bank) 

· Initial bank capital injection of £5m lower than previously anticipated 

· Group EBITDA loss of £10.2m (prior period: £9.9m), which includes the results of Tungsten Network for the period since acquisition 

· Post-tax loss for year of £11.0m (prior period: £9.9m) and loss per share of 18.6p (prior period: loss per share of 87.02p).

Basis of the presentation of results

Tungsten completed its acquisition of OB10 Limited (now renamed Tungsten Network Limited "Tungsten Network") on 16 October 2013.

In accordance with International Financial Reporting Standards, the consolidated financial results of the Tungsten Group include the results of Tungsten Corporation plc and Tungsten Corporation Guernsey Limited for the whole of the 12-month period, but only include the results of Tungsten Network Limited and its subsidiaries for the period since acquisition. On this basis, our loss before tax for the period was £11.1m (period ended 30 April 2013: £9.9m).

Tungsten Network e-Invoicing platform

We have invested heavily in the development of Tungsten Network since the acquisition to improve the technical capabilities; further enhance resilience and security; further increase the number of countries where we are compliant with tax and e-Invoicing regulations, and attract new buyer and supplier customers. On a pro-forma basis, revenue for Tungsten Network in FY2014 was £19.5m (FY2013: £17.6m), an increase of 11%.

The value of e-Invoices processed in FY2014 totalled $152bn, compared with $126bn in FY2013.

We are working with our customers to transition IDC 'paper' transactions to our e-Invoicing network. As a result, IDC invoices have reduced from $48bn in the previous financial year to $35bn in FY2014.

The volume of e-Invoices processed increased to 12.5m in FY2014, up over 16% from 10.8m in FY2013.

We have reviewed our buyer groupings to reflect recent corporate activities and have appropriately structured our customer relationship managers (CRMs) with the buyers that they will serve. On this basis we now have 124 corporate and governmental buyers, including 116 currently transacting and eight new companies in implementation. This is a net increase of five buyers since 31 December 2013, as reported in our interim report on 8th January 2014.

The number of countries in which Tungsten Network now offers compliant e-Invoicing has grown to 46, including the recent additions of Saudi Arabia and UAE. Supporting our customers by increasing our portfolio of compliant countries and driving global e-Invoicing policy remains a key strategic priority.

Due to our continued investment in the stability and integrity of Tungsten Network, we have received a clean report under the International Standards for Assurance Engagements (ISAE) 3402 Assurance Reports on Controls at a Service Organisation. Tungsten Network has also been awarded ISO 27001 certification, the international standard describing best practice for an information security management system. We have curtailed a number of other networks with whom we offered inter-operability to maintain the integrity of our Network.

Tungsten Network Analytics

We agreed a five-year licence for spend analytics algorithms. We have integrated these algorithms with the data on Tungsten Network. To bring Tungsten Network Analytics to market, we have developed a powerful reporting interface and can now provide real-time, line-level analysis to identify instances of price variance.

The spend analytics product is now in live pilots. We have shared the beta version with a number of buyer customers and the initial feedback has been very encouraging. We are currently in discussions with a number of these customers to agree commercial terms.

Tungsten Network Finance (incorporating Tungsten Bank)

Post the period-end, Tungsten completed the regulatory approval process and acquired FIBI Bank (UK) plc, now renamed Tungsten Bank plc, in June 2014. Final completion payments of £25.1m resulted in total consideration of £29.3m. Provisional net assets acquired were £20m, resulting in goodwill of £9.3m. As we completed the acquisition after the year-end these amounts are currently unaudited, although they represent a considerably lower initial capital requirement than anticipated at the time of the IPO.

We are delighted to have appointed the Tungsten Bank board, including Non-Executive Directors Robert Eddowes, Richard Olliver and Tim Hall. Their experience and oversight complements additional new hires to the Tungsten Network Finance business, including Gordon Payne; COO Holger Beyer; Head of Financing Operations Andrew Wilson; Head of Credit Analytics Andreas Rands; and Head of Compliance Georgina Behrens. We will continue to build the team over the coming year.

We have made significant investment in the Tungsten Network Finance infrastructure, to create a stable and secure financing platform fully integrated with Tungsten Network. Combined with the development of our risk management framework, we have built a technical infrastructure designed to exceed the UK's strict Banking regulation regime.

While developing Tungsten Network Finance, we selected suppliers that are already members of Tungsten Network to trial our supply chain financing service; and plan to introduce more suppliers in July 2014.

In addition to Tungsten Bank, Tungsten Network Finance has progressed discussions with a range of third parties to explore additional sources of capital across the geographies and jurisdictions that Tungsten operates in. In particular, we have advanced the negotiations and operational capability to work with Blackstone Tactical Opportunities to provide invoice and trade finance on an international basis. We expect to be able to update the market further within the next couple of months.

Edmund Truell, CEO of Tungsten Corporation plc, said:

"Tungsten is now unrecognisable from where we were 12 months ago. It has been a remarkable year of growth and hard work in securing our admission to AIM, completing two significant acquisitions and developing the delivery capabilities across each of our businesses.

The acquisition of Tungsten Bank, completed in June 2014, is an important milestone. By aiming to exceed the strict requirements of the PRA and FCA for change of control, we have demonstrated our commitment to risk management, compliance and oversight.

We are excited about the year ahead as we disrupt global markets with the launch of our Tungsten Network Finance and Analytics products. In addition, with the rise of mandatory e-Invoicing and the successful trials of Tungsten Network Analytics, corporations and government departments no longer have an excuse for continued poor procurement.

The new financial year has started very encouragingly with high-calibre new buyers selecting Tungsten Network, including GE and Caterpillar. We have also added new countries to our list of e-Invoicing compliant countries, such as Saudi Arabia and UAE, and developed our supply chain financing platform. Our focus for this year is to invest in growth across all of our businesses, which will support our long-term strategic plans".

Arnold Hoevenaars, Chairman of Tungsten Corporation plc, added:

"We have made great strides over the past year towards delivering our vision to monetise the global supply chain.

Progress has been made in the key strategic areas as we build our business to integrate our e-Invoicing network with a financing platform and our spend analytics offering. Once complete, we believe that we will have an unrivalled customer proposition. It is especially encouraging that major government departments in the US and Germany are using Tungsten to good effect.

The Tungsten Group now has the building blocks in place to start the next phase in the growth of Tungsten and we all look forward to what FY2015 will bring".

An analyst call will be held on Tuesday 8th July 2014 at 9.00am BST and an accompanying presentation will be available to view online at www.tungstencorporationplc.com/content/investor-information.

The Annual Report and accounts for the year ended 30th April 2014 are being published today and will also be available to view online at www.tungstencorporationplc.com/content/investor-information.

For further information:

Tungsten Corporation plc +44 20 7280 7807 Edmund Truell, CEOSandra Higgison, Head of Global Communications

Charles Stanley Securities +44 20 7149 6000(NOMAD and Joint Broker)Marc MilmoDugald Carlean

Canaccord Genuity (Joint Broker) +44 20 7523 8000Simon BridgesPeter StewartCameron Duncan

Equus Group (Communications) +44 20 7223 1100Piers HooperSam Barton

Forward looking statements

This document contains forward-looking statements that may or may not prove accurate. For example, statements regarding expected revenue growth and trading margins, market trends and our product pipeline are forward-looking statements. Phrases such as "aim", "plan", "intend", "anticipate", "well-placed", "believe", "estimate", "expect", "target", "consider" and similar expressions are generally intended to identify forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties and other important factors that could cause actual results to differ materially from what is expressed or implied by the statements. Any forward-looking statement is based on information available to Tungsten as of the date of this statement. All written or oral forward-looking statements attributable to Tungsten are qualified by this caution. Tungsten does not undertake any obligation to update or revise any forward-looking statement to reflect any change in circumstances or in Tungsten's expectations.

About Tungsten Corporation plc

Tungsten Corporation (LSE: TUNG) accelerates global trade by enabling customers to streamline invoice processing, improve cash-flow management and make better buying decisions from their detailed spend data.

Buyer organisations that join Tungsten Network, built on OB10 e-Invoicing, can reduce their invoice-processing costs by 60%. Suppliers benefit from efficiencies, greater visibility of their invoice status and peace of mind. Tungsten offers supply chain financing to suppliers and helps buying organisations profit by applying real-time spend analytics to its vast repository of line-level invoice data.

Tungsten connects the world's largest companies and government agencies to their thousands of suppliers around the globe. It is compliant in 46 countries, and processes transactions worth over $185bn per year for organisations such as Alliance Data, Aviva, Cargill, Deutsche Lufthansa, General Motors, GlaxoSmithKline, Henkel, IBM, Kellogg's and the US Federal Government.

Tungsten Corporation joined forces with OB10 in 2013 to create the world's largest electronic trading network.

TUNGSTEN CORPORATION PLC

("Tungsten" or collectively the "Tungsten Group")

PRELIMINARY RESULTS FOR THE FINANCIAL YEAR ENDED

30th APRIL 2014

Chairman's statement

It has been a year of fantastic progress. We started with a vision to take advantage of the opportunities created by the economic crisis to acquire undervalued segments of the financial market and transform them through the application of disruptive technology and smarter management. We ended the year with a business that integrates an e-Invoicing network with supply chain finance and real-time spend analytics.

Tungsten's admission to the Alternative Investment Market of the London Stock Exchange raised £160m in new money and was one of the largest on AIM since 2008. With a market capitalisation on admission of £225m, the placing was oversubscribed by high-calibre institutional investors. We are delighted with our shareholder base.

We are well positioned to take advantage of the continued constriction of traditional bank lending to businesses; help organisations make more effective use of their data; and support governments as they drive process automation and tax compliance.

By combining Tungsten Network Finance, Tungsten Network and our Tungsten Network Analytics product, we have introduced an unrivalled value-creation proposition to corporations and governments around the world.

New talent

To complement the depth of experience of our board, we welcomed Lincoln Jopp as COO in April. Having run international operations around the world, he is well qualified to support Tungsten in the delivery of our goals.

We have recruited many talented people to support the growth of Tungsten Network, Tungsten Bank and Tungsten Network Finance and I would like to take this opportunity to welcome them all to our business. I would also like to thank all our staff members around the world who are helping us break new ground as we realise our ambition to build the world's largest electronic trading network.

The year ahead

The new financial year has started positively with the completed acquisition of Tungsten Bank demonstrating our adherence and commitment to the highest standards of the Bank of England as our regulator. We have also launched the Tungsten Network Finance offering to select suppliers and will focus on controlled growth for our financing balance sheet over the year.

We will continue to invest in the development of Tungsten Network to improve the buyer and supplier experience, and complement our best-in-class security and compliance infrastructure. Our new buyer pipeline is strong and we look forward to welcoming new organisations to the network.

On behalf of the Board, I should like to thank our staff worldwide for their unstinting efforts and our shareholders for their continued support.

Annual General Meeting

Our AGM will be on 22nd September 2014 at 88 Wood Street, London, EC2V 7QR, UK.

Arnold Hoevenaars

Non-Executive Chairman

Chief Executive's review

Tungsten Corporation has come a long way in a short time. Since our successful admission to AIM and completing the acquisition of OB10, we have developed and grown Tungsten Network while building the capacity to deliver both Tungsten Network Finance and Tungsten Network Analytics.

As indicated at the IPO, we have made significant investment in our people, systems and products in FY2014 and plan to do so further in FY2015. Our vision is to be a market-leading global force and we recognise the need to build a scalable platform, capable of sustaining 10 times the current volume. As well as a significant investment in systems and people, we are simplifying the network offering to give customers the best possible experience when they enrol and transact with Tungsten.

These actions impact profitability in the short-term and are reflected in our reported EBITDA loss of £10.2m for the year.

Current trading and recent events

Since the year end, we completed the acquisition of Tungsten Bank; we are excited to announce that our supply chain financing services will begin in July.

Tungsten Network has increased adoption among its existing buyers of its Invoice Status Service to give suppliers visibility of when their invoices are received and approved for payment.

We continue to attract high-calibre new buyers, including GE, which intends to rollout a multi-year global e-Invoicing programme, and Caterpillar, which is providing e-Invoicing to suppliers in the UK and Poland. Six additional buyers are at the implementation stage. Having redefined our buyer groups to align to our new customer relationship management (CRM) strategy, once all organisations are live, we will count 124 multinational and governmental buyers on Tungsten Network.

Revenue from new buyers is now recognised over periods of up to three years, so will not be immediately apparent in our reported results, which include up-front implementation costs. We expect to recognise revenues from the new buyers in implementation towards the end of FY2015.

Once we achieve tax compliance in new countries, such as the recent additions of Saudi Arabia and the UAE, we will work with buyers and suppliers to increase network usage. We will continue our multi-million pound investment in compliance, rules mapping and CRM teams, which are key building blocks in achieving our growth targets.

We have talked to many of our current and prospective customers in the private and public sectors, and are encouraged by their appetite for automation, analytics and alternative sources of finance. They tell us that they want to work smartly by eliminating waste and fraud, make better-informed decisions and pursue growth through greater access to finance. Our ambition to monetise the global supply chain will help customers meet these aims, reduce uncertainty and improve compliance.

At its core, Tungsten Corporation features an integrated global e-Invoicing network, innovative spend analytics technology and automated supply-chain finance with dedicated funding. Standalone, each element is a market-leading offering, and once combined create a unique proposition that has been described as 'the shot heard around the world'. 1

We have a clear vision for each of our business areas with well-defined paths towards achieving them.

_____________

Tungsten Network

Aim: to achieve $1,000 billion in annual invoice flow

Tungsten Network, built on OB10 e-Invoicing, sits at the heart of our business. Our e-Invoicing services deliver efficiencies to our customers from touchless, paperless processing. The network also provides the invoice transaction data for Tungsten Network Analytics, and the portal that introduces the Tungsten Network Finance early payment proposition.

Our focus for the coming year is to increase the volume of invoices through the network by attracting new corporate and governmental buyers and suppliers, and increasing the proportion of existing buyers' invoices that flow through the network. We believe we can grow volumes to our $1,000billion goal just by rolling out e-Invoicing to our current buyers globally and fully penetrating their supply base. A particular focus is on extending our Invoice Status Service (ISS) to more buyers, which gives suppliers visibility of the progress of their invoices and payment dates and reduces their accounts payable queries. Initially, only ISS-enabled invoices will be considered for early payment by Tungsten Network Finance.

Maintaining our rigorous adherence to local tax and commercial compliance will remain a priority so that our customers can continue to trade with confidence through our network. To meet their demands for expansion we will increase the number of countries where we provide compliant invoicing and have recently added Brazil, Turkey, Saudi Arabia and the UAS, taking our portfolio to 46 countries. With greater geographic coverage, more of our customers can extend their programmes globally giving us access to more suppliers to enrol on the network.

We intend to make our registration process simpler and swifter by investing in fully automated enrolment for suppliers, and are reviewing our pricing structures to match the price our customers pay with the considerable value that we provide. We are confident in our value provision and will not offer uneconomic services in the future. Accordingly, we have started to convert those customers for whom we process 'paper' invoices to electronic invoices and we have made considerable strides in this area.

We intend to stay at the forefront of the global adoption of e-Invoicing by working with Fortune 2000 companies and G20 governments. We will continue to grow our capabilities and partnerships, such as the reseller agreements we formed this year with PNC Bank in the US and Buzón-E in Mexico. In preparation for the recent EU Directive on e-Invoicing in Public Procurement that will mandate the acceptance of e-Invoicing by public bodies, we have secured accreditation by the UK Government's G-Cloud 5 Framework; and are delighted to have commenced a pilot project for the German government with potential roll out to the whole public sector. In addition, the US Department of Veterans Affairs has secured congressional approval to mandate the use of e-Invoicing. Tungsten Network is the sole e-Invoicing network supported for use by its suppliers.

Integral to all of our activities will be to maintain our stringent focus on data and network security. We have upgraded the network protections, put network integrity at the top of the management agenda and ended interoperation agreements with networks that do not reach our high standards.

Tungsten Network Finance

Aim: $100 billion annual finance flow

Subsequent to the year-end, in June 2014, we were delighted to secure approval from the Prudential Regulatory Authority (PRA) of the Bank of England to acquire FIBI Bank (UK) plc, now renamed Tungsten Bank plc. This was one of the first applications to be approved for change in control since formation of the PRA and FCA, and demonstrates the capability of our technical infrastructure, risk management, compliance and oversight.

We invested heavily in developing the operational, technological and governance structures to operate Tungsten Bank and Tungsten Network Finance to the highest standards and have conducted successful live trials to selected suppliers.

We will increase the global availability of finance for invoice discounting, especially for the growing volume of cross-border trade. Our simple and transparent transactional experience is supported by a dynamic pricing model that is flexed by time, supplier demand and credit worthiness. To enable us to offer early payment to establishing financing structures in new geographies through Tungsten Bank and other financing vehicles or partnerships. We are doing this while maintaining our governance standards to meet and exceed current and potential future regulatory requirements.

Tungsten Network Analytics

Aim: $10 billion annual cost savings

The development of a powerful, real-time spend analytics product as part of our Tungsten Network services has generated significant interest among our existing customers and industry commentators. By analysing line-level invoice data, customers can quickly review price variance information that has been difficult for procurement and finance teams to access. Traditional price variance tools have tended to operate at a category level based on, at best, month-old data. To enhance the product we have built and introduced an intuitive user interface and deployed the system to the cloud.

Our tool can also automatically check invoices as they are received by the network, highlighting any that appear to have an adverse price variance. This drives cost savings and reduces the workload for the buyers' procurement departments.

Our work with six pilot customers has identified price variances of $1.7 billion to date, with possible savings of between 0.5% and 4.2% of spend processed through Tungsten Network. Using these results, we will move to full product deployment across Europe and the US. We also intend to improve the product's functionality to deliver even greater insights.

Tungsten Network Analytics will prove to be a driver for increasing transaction flow across Tungsten Network as procurement teams seek further data for the line-item visibility we provide.

Edmund Truell

Group Chief Executive Officer

Financial review

Highlights

· £160m equity funding raised on admission to AIM

· Completed acquisition of OB10 (now Tungsten Network) for £73m in cash and £28m in equity

· Tungsten Network pro-forma revenue increased by 11% to £19.5m (FY2013: £17.6m)

· Tungsten Group EBITDA loss of £10.2m (FY2013: loss of £9.9m)

· Post-tax loss of £11.0m (prior period: £9.9m)

Overview and Group trading performance

On 19 March 2013, we reached an agreement for the acquisition of FIBI Bank (UK) plc, subject to the necessary regulatory clearances. A deposit of £1.2m was paid at that time. Over the period 1 May 2013 to 30 April 2014, further deposit payments of £2.8m were made. The acquisition was completed after the end of the FY2014 reporting period, on 10 June 2014. All deposit payments made were deductible against the final consideration of £29.3m.

On 16 October 2013, we were admitted to AIM, raising £160m (£149m net of costs), and completed the acquisition of OB10 Limited for a total of £73m in cash and £28m in equity. Our reported results include the results of OB10 Limited (now Tungsten Network Limited) only for the period since the acquisition.

On 22 October 2013, we announced our agreement with @UK plc (now Cloudbuy plc) for the licensing of spend analytics algorithms. To date we have made payments totalling £0.5m to Cloudbuy pursuant to our five-year licencing agreement. The spend analytics software forms part of Tungsten Network Analytics, which sits in our Tungsten Network business.

Since our admission to AIM we have made significant investment in the people, infrastructure and working capital of Tungsten Network Finance, Tungsten Network and Tungsten Network Analytics, and the integration between them. We spent £9m in FY2014 on customer acquisition, systems development and the Group's global expansion and expect to make additional investments in these areas in FY2015.

At 30 April 2014, the Group had cash balances of £62.6m. In June 2014, we invested £25.1m on the acquisition of Tungsten Bank into which we have injected a further £5m of capital.

Group EBITDA

Tungsten Group EBITDA loss for the year end 30 April 2014 was £10.2m (prior period: £9.9m). Tungsten Network EBITDA loss of £1.3m (prior period: nil) reflects the results of Tungsten Network Limited for the period from 16 October 2013 to 30 April 2014. Tungsten Network Finance EBITDA loss of £1.9m (prior period: nil) reflects costs incurred by Tungsten Corporation plc in the acquisition of Tungsten Bank and the development of our supply chain finance business. Corporate EBITDA loss of £7.0m (prior period: £9.9m) reflects the costs incurred in making our acquisitions, the Board, Group management and head office running costs.

Tungsten Network

Tungsten Group's reported EBITDA loss for the period includes an EBITDA loss in respect of Tungsten Network of £1.3m (prior period: nil).

On a pro-forma annualised basis, the Tungsten Network EBITDA loss for FY2014 was £2.7m (prior period: £2.6m loss). This is before a share-based payment charge of £4.1m, which was incurred in October 2013 prior to the acquisition by Tungsten (2013: £0.5m)

Pro-forma annualised revenue for Tungsten Network for FY2014 was £19.5m (prior period: £17.6m), an increase of 11%.

Tungsten Network Finance

Tungsten Group incurred costs associated with the Tungsten Network Finance business totalling £1.9m in the year (prior period: nil). This includes regulatory costs, costs of the development of policies and procedures, software development and staffing costs.

Tungsten Network Finance did not earn any revenue in the period.

Corporate

The corporate EBITDA loss totalled £7.0m (prior period: £9.9m).

This excludes £10.8m of costs incurred in connection with the admission onto AIM, which have been taken directly to the share premium account.

Balance sheet

Non-current assets have increased by £115.7m to £115.9m driven by the acquisition of OB10 Limited, which as at 30 April 2014 comprised £114.2m.

The Group capitalised software costs associated with the building of the Tungsten Network Finance infrastructure totalling £0.3m.

The Group capitalised £1.3m of costs associated with the redevelopment of our new head office, Pountney Hill House, to house Tungsten Corporation, Tungsten Bank and the operation of Tungsten Network London.

Cash flow

Cash outflow from operating activities increased to £8.1m (prior period: £5.0m), reflecting investment in systems, products and working capital.

Liquidity and going concern

At 30 April 2014, the Group had cash on hand and short-term deposits of £62.6m. The Group has no borrowings.

We expect to have sufficient cash resources to fund the committed activities of the Group for at least 12 months from the date of these financial statements. Additional funding to support the lending capacity of Tungsten Network Finance will be sought from external sources with a range of funding sources being considered.

The Group's forecasts and projections, taking account of reasonably possible changes in trading performance and the timing of the growth in Tungsten Network Finance, show that the Group has sufficient liquidity to fund its committed expenditure. Accordingly, the Group continues to adopt the going concern basis.

Post balance sheet events

On 10 June 2014 the Company completed the acquisition of the entire share capital of FIBI Bank (UK) plc (subsequently renamed Tungsten Bank plc). The total consideration paid on or prior to completion was £29.3m and is subject to a net asset adjustment within 30 days of completion. £1.0m of the consideration is held in escrow for 18 months in lieu of any warranty claims. In addition, we have also injected a further £5m of capital into Tungsten Bank.

Jeffrey Belkin

Chief Financial Officer

Items in the statement above are disclosed net of tax.

Consolidated statement of financial position

Consolidated statement of changes in equity

Consolidated statement of cash flows

Basis of preparation

This financial information does not constitute the Group's statutory accounts for the period ended 30 April 2013 and year ended 2014. The financial information in respect of 2014 has been extracted from the audited financial statements for the year ended 30 April 2014 which have not yet been delivered to the Registrar of Companies. The auditors have reported on these financial statements; their reports were (i) unqualified, (ii) did not include a reference to any matters to which the auditors drew attention by way of emphasis without qualifying their report, and (iii) did not contain a statement under section 498(2) or (3) of the Companies Act 2006.

The information has been prepared in accordance with the EU-adopted International Financial Reporting Standards (IFRS) and IFRIC interpretations and with those parts of the Companies Act 2006 which are applicable to companies reporting under IFRS.

1. Accounting policies

These results have been prepared applying the accounting policies and presentation of the financial statements for the period ended 30 April 2013 together with those additional accounting policies presented in our interim financial report for the six months ended 31 October 2013 dated 8 January 2014.

2. Forward-looking statements

Certain statements in this preliminary announcement are forward-looking. Although the Group believe that the expectations reflected in the forward-looking statements are reasonable, we can give no assurance that these expectations will prove to have been correct. Because these statements involve risk and uncertainties, actual results may differ materially from those expressed or implied by the forward-looking statements.

3. Segment information

Management have determined the operating segments based on the operating reports reviewed by the Board of Directors that are used to assess both performance and strategic decisions. Management has identified that the Board of Directors is the chief operating decision maker (CODM). 

The Board of Directors reviews financial information for three segments: Tungsten Network (which includes the e-Invoicing and spend analytics business of Tungsten Network (formerly OB10 Limited), Tungsten Network Finance (which includes the supply chain finance business Tungsten Network Finance) and Corporate (which includes overheads and general corporate costs). Intersegment revenue from management fees is eliminated below. For the period ended 30 April 2013, the Group had one reportable segment due to the sole business activity being the identification and acquisition of companies.

3 Segment information (continued)

Year ended 30 April 2014

Period ended 30 April 2013

3 Segment information (continued)

Geographical information

The Group's revenue from external customers and non-current assets by geographical location are detailed below.

Revenue by geographical location is allocated based on the location in which the sale originated.

Non-current assets are allocated based on the geographical location of those assets and excludes other financial assets, loans receivable and deferred tax.

4. Business combinations

On 16 October 2013 the Group completed its acquisition of 100% of the issued ordinary share capital of Tungsten Network Limited (formerly OB10 Limited) in consideration of the payment of £73.0m in cash and the issue to the vendors of 12,484,143 ordinary shares of the Company. The primary reason for the acquisition was to support the growth of a global integrated supply chain platform.

In the period from 16 October 2013 to 30 April 2014, Tungsten Network has contributed £10.77m of revenues and a £1.2m EBITDA loss.

If the acquisition had occurred on the first day of this reporting period, being 1 May 2013, the contributions would have been £19,45m of revenues and a £6.56m EBITDA loss.

The table below sets out the final fair values at the acquisition date. The goodwill of £98.7 million arising on acquisition principally relates to skills and know how present within the assembled workforce, customer service capability and the future opportunities available once the Group completes its acquisition of a Bank to provide a financing platform.

The fair value adjustments consist of the harmonisation with the Group's IFRS compliant accounting policies and the recognition of intangible assets (customer relationships and IT platform).

Transaction costs of £2.1m have been expensed and are included in administrative expenses.

4 Business combinations (continued)

5. Intangible assets

6. Loss per share

Basic loss per share is calculated by dividing the loss attributable to the ordinary shareholders by the weighted average number of ordinary shares in issue during the period.

7. Post balance sheet events

Bank purchase

On 10 June 2014, the Group completed the acquisition of the entire share capital of FIBI Bank (UK) plc (subsequently renamed Tungsten Bank plc). The total consideration paid on or prior to completion was £29.3m and is subject to a net asset adjustment within 30 days of completion. £1.0m of the consideration is held in escrow for 18 months in lieu of any warranty claims.