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ESGL Holdings Limited Reports First Half 2024 Financial Results

SINGAPORE, Sept. 20, 2024 (GLOBE NEWSWIRE) -- ESGL Holdings Limited (NASDAQ: ESGL) (“ESGL” or the “Company”), a leading carbon neutral, innovative enviro-tech company regenerating industrial waste into circular products, today announced its financial results for the six-month period ended June 30, 2024.

First Half 2024 Highlights:

  • First-Time Subsidiary Profitability: ESGL's operating subsidiary posted its first-ever profitable half-year, a significant milestone compared to the loss recorded in first half of 2023.
  • Revenue Growth: Revenue for the first half of 2024 increased to US$3.49 million, a 2.8% improvement from the prior year, despite regulatory challenges and volatility in waste volumes.
  • Significant Reduction in Losses: Loss before taxation improved by 45.3%, reduced from US$590,000 in the first half of 2023 to US$322,000, driven by strict cost management and operational efficiencies.
  • Logistics Cost Savings: Logistics costs were reduced by US$527,000, a 66.6% decrease year-on-year, significantly improving the Company’s cost base.

Operational and Segment Performance:

  • Solid Waste Thermal Processing Solutions: Revenue grew by 8.15%, underpinned by the collection of new waste types and the expansion of the Company’s customer base.
  • Liquid Waste Synthesis Solutions: Revenue in this segment declined by 45.8% due to the regulatory impact on a key customer. However, the Company expects recovery in the second half of 2024.
  • Circular Products Sales: Sales declined by 39.1% due to lower demand for base metals, though the Company remains optimistic about improving market conditions.
  • Other Income: Foreign exchange gains contributed to a US$93,000 increase in other income, reflecting favorable currency movements.

Outlook for the Second Half of 2024:

ESGL is optimistic about its performance in the second half of 2024, driven by a focus on expanding its solid hazardous waste customer base and regaining liquid hazardous waste volume, while maintaining operational efficiency and achieving cost savings. Additionally, the Company is actively working to renew long-term contracts with key clients to sustain and enhance profitability.

CEO Statement:

Quek Leng Chuang, Chief Executive Officer and Chairman of ESGL, commented: “We are proud to report that our operating subsidiary has achieved its first profitable half-year. This significant milestone reflects the strength of our strategic focus on cost efficiency and operational optimization. As we look toward the second half of 2024, we remain confident in our ability to drive sustained growth across our core segments and continue to build momentum toward long-term profitability.”

About ESGL Holdings Limited

ESGL Holdings Limited is a Singapore-based carbon-neutral enviro-tech company dedicated to transforming industrial waste into circular products. With a commitment to sustainable waste management solutions, ESGL is a leading player in the environmental solutions industry. ESGL conducts all its operations through its operating subsidiary incorporated in Singapore, Environmental Solutions (Asia) Pte. Ltd. For more information, including the Company’s filings with the SEC, please visit https://esgl.asia.

Investor Relations Contact:

ESGL Holdings Limited
Investor Relations Department
Email: ir@esgl.asia
Phone: +65 6653 2299

Forward-Looking Statements
Certain statements in this press release may be considered to contain certain “forward-looking statements” within the meaning of “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as: “target,” “believe,” “expect,” “will,” “shall,” “may,” “anticipate,” “estimate,” “would,” “positioned,” “future,” “forecast,” “intend,” “plan,” “project” and other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. Examples of forward-looking statements include, among others, statements made in this press release regarding anticipated future financial and operating performance and results, including estimates for growth, gross margins, adjusted EBITDA, potential regional expansion, development of new products, partnerships, customer relationships, demand for waste processing, and sales of circular products. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on ESGL management’s current beliefs, expectations, and assumptions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks, and changes in circumstances that are difficult to predict and many of which are outside of our control. Actual results and outcomes may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. A further list and description of risks and uncertainties can be found in documents filed with the Securities and Exchange Commission (“SEC”) by ESGL and other documents that the Company may file or furnish with the SEC, which you are encouraged to read. Any forward-looking statement made by us in this press release is based only on information currently available to the Company and speaks only as of the date on which it is made. The Company undertakes no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments, or otherwise, except as required by law.

ESGL Holdings Limited
Consolidated Statement of Financial Position
As at June 30, 2024 and December 31, 2023

    
 June 30, 2024 December 31, 2023
 US$ US$
ASSETS   
Current assets   
Cash and cash equivalents256,501  366,761 
Trade and other receivables985,951  1,032,522 
Prepaid forward purchase agreement-  969 
Inventories78,682  64,184 
 1,321,134  1,464,436 
Non-current assets   
Property, plant and equipment, net21,043,668  21,786,365 
Intangible assets, net2,475,974  2,381,465 
 23,519,642  24,167,830 
    
Total assets 24,840,776    25,632,266  
    
LIABILITIES   
Current liabilities   
Trade and other payables5,503,478  6,560,559 
Lease liabilities149,516  192,282 
Borrowings4,672,286  5,666,160 
Deferred underwriting fee payable2,153,125  2,753,125 
Tax liabilities203,020  56,540 
 12,681,425  15,228,666 
    
Non-current liabilities   
Lease liabilities (non-current)1,852,343  1,974,524 
Borrowings (non-current)-  112,319 
Deferred tax liabilities298,000  296,000 
 2,150,343  2,382,843 
    
Total liabilities 14,831,768    17,611,509  
    
Net assets 10,009,008    8,020,757  
    
EQUITY   
Share Capital11,892  10,892 
Accumulated losses(100,457,352) (99,985,928)
Other reserves3,422,799  3,422,799 
Share premium reserve92,183,727  89,725,052 
Exchange Reserves(123,198) (123,198)
Revaluation Surplus14,971,140  14,971,140 
Total equity10,009,008  8,020,757 
    
    

ESGL Holdings Limited                                  
Consolidated Statement of Profit or Loss and Other Comprehensive Income for the Financial
Periods ended June 30, 2024 and 2023

 June 30, 2024June 30, 2023
 US$US$
Revenue3,487,879 3,394,313 
   
Other income282,213 189,335 
   
Cost of inventory(78,366)(407,291)
   
Logistics costs(264,638)(792,079)
   
Depreciation of property, plant and equipment(781,394)(758,519)
   
Amortization of intangible assets(559,340)(426,515)
   
Employee benefits expense(878,320)(639,060)
   
Finance expense(147,128)(158,912)
   
Other operating expenses(1,383,850)(991,526)
Loss before income tax(322,944)(590,254)
   
Income tax expense(148,480)(39,000)
   
Net loss and comprehensive loss(471,424)(629,254)
   
Loss per share(0.03)(0.10)
Weighted average number of shares14,000,514 6,378,267 
   
   

ESGL Holdings Limited
Consolidated Statement of Changes in Equity for the Financial Periods ended June 30, 2024 and 2023

 Share
capital
 Revaluation
reserve

 Exchange
reserve

 Share
premium
reserve

 Other
reserve

 Accumulated
losses

 Total equity
 US$ US$ US$ US$ US$ US$ US$
              
2023             
Beginning of financial year10,000 15,157,824 (460,481) - 3,422,799 (5,006,590) 13,123,552 
Issuance of new shares3 - -  753,587 - -  753,590 
Loss for the year- - -  - - (629,254) (629,254)
Balance as of June 30, 202310,003 15,157,824 (460,481) 753,587 3,422,799 (5,635,844) 13,247,888 
              
2024             
Beginning of financial year10,892 14,971,140 (123,198) 89,725,052 3,422,799 (99,985,928) 8,020,757 
Issuance of new shares1,000 - -  2,458,675 - -  2,459,675 
Loss for the year -   -   -    -   -  (471,424) (471,424)
Balance as of June 30, 2024 11,892   14,971,140   (123,198)  92,183,727  3,422,799  (100,457,352)  10,009,008  
              
              

ESGL Holdings Limited
Consolidated Statement of Cash Flows for the Financial Periods ended June 30, 2024 and 2023

 June 30, 2024  June 30, 2023 
  US$  US$ 
Cash flows from operating activities   
Loss before income tax (322,944)  (590,254)
    
Adjustments for:   
- Prepaid forward purchase agreement written-off 969    -  
- Depreciation of property, plant and equipment 781,394    758,519  
- Amortisation of intangible assets 559,340    426,515  
- Interest income (3)  (12,002)
- Interest expense 147,128    158,912  
- Loss/(gain) on disposal of property, plant and equipment -    1,795  
- Foreign exchange adjustment (191,391)  312,051  
  974,493    1,055,536  
Changes in operating assets and liabilities:   
- Trade and other receivables 40,746    (687,016)
- Inventories (14,498)  153,252  
- Trade and other payables (1,043,521)  167,205  
Net cash (used in)/generated from operating activities (42,780)  688,977  
    
Cash flows from investing activities   
Purchase of property, plant and equipment (38,697)  (115,334)
Proceeds from disposal of property, plant and equipment -    1,352  
Additions to intangible assets (653,849)  (633,912)
Interest received 3    12,002  
Net cash used in investing activities (692,543)  (735,892)
    
Cash flows from financing activities   
Proceeds from bank borrowings 747,197    2,246,518  
Repayment of bank borrowings (1,691,453)  (1,831,341)
Shares issuance 2,459,675    753,590  
Repayment of underwriting fees(600,000) - 
Repayments of lease liabilities (143,228)  (57,718)
Interest paid (147,128)  (158,912)
Net cash provided by provided by financing activities 625,063    952,137  
    
Net (decrease)/increase in cash and bank balances (110,260)  905,222  
    
Cash and cash equivalents   
Beginning of the financial year 366,761    252,399  
End of the financial periods 256,501    1,157,621  
    


  1. General information

    ESGL Holdings Limited

    ESGL Holdings Limited (“ESGL” or the “Company”) was incorporated in the Cayman Islands on November 18, 2022. Following the successful completion of a business combination on August 3, 2023 (the “Business Combination”), ESGL listed on Nasdaq and became a publicly traded company. ESGL’s stock commenced trading August 4, 2023.

    ESGL’s subsidiaries are as follows:

    Environmental Solutions Group Holdings Limited (“ESGH”)

    Environmental Solutions Group Holdings Limited is a holding company incorporated under the laws of the Cayman Islands as an exempted company with limited liability on June 14, 2022. The address of its registered office is 71 Fort Street, PO Box 500, George Town, Grand Cayman, KY1-1106, Cayman Islands. As a holding company with no material operations of its own, ESGH conducts all of its operations through its operating entity incorporated in Singapore, Environmental Solutions (Asia) Pte. Ltd.

    Environmental Solutions Asia Holdings Limited (“ESAH”)

    ESAH, a wholly-owned subsidiary of the ESGH, was incorporated on June 29, 2022 and domiciled in the British Virgin Islands with its registered office at Mandar House, 3rd Floor, Johnson’s Ghut, Tortola, British Virgin Islands.

    Environmental Solutions (Asia) Pte. Ltd. (“ESA”)

    ESA was incorporated and domiciled in Singapore, with its registered office at 101 Tuas, South Avenue 2, Singapore 637226. ESA is a waste management, treatment and recycling company involved in the collection and recycling of hazardous and non-hazardous industrial waste from customers such as pharmaceutical, semiconductor, petrochemical and electroplating companies.

    As ESGL, ESGH, ESAH and ESA (collectively the “Group”) were under common control, the Business Combination constituted a reorganization under common control and are required to be retrospectively applied to the consolidated financial statements at their historical amounts. The consolidated financial statements have been prepared as if the existing corporate structure had been in existence throughout all periods. This includes a retrospective presentation for all equity related disclosures, including issued shares, which have been revised to reflect the effects of the reorganization in accordance with International Financial Reporting Standards (“IFRS”) as of June 30, 2024 and 2023.

Subsidiaries

The consolidated financial statements of the Group include:

  Place ofEffective equity held by the Group
  incorporation
Name of subsidiaryPrincipal activitiesand business
   20242023
   %%
Held by the Company    
Environmental Solutions Group Holdings LimitedInvestment holding companyCayman Island100100
     
Held by Subsidiary    
Environmental Solutions Asia Holdings LimitedInvestment holding companyBritish Virgin Islands100100
     
Environmental Solutions (Asia) Pte. Ltd.Waste management and recycling of industrial wastesSingapore100100
     

The accompanying notes form an integral part of these financial statements.


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