Business
JM | Nov 22, 2021

SSL Venture Capital remains insolvent, despite selling off some assets

/ Our Today

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2021 watershed year for the company

Despite selling off some of its assets in recent time, publicly listed investment company, SSL Venture Capital remains insolvent as its current liabilities exceed current assets by $73.2 million.

This admission was made by CEO Zachary Harding in the company’s recently released 2021 annual report.  He described the financial year ending June 2021, as a watershed year for SSL Venture Capital.

According to him, “having restructured the business in 2020, including divesting our stake in Blue Dot Data Intelligence, and repositioning the business for greater efficiency, growth, and profitability, we were hit by the COVID-19 global pandemic. Just like many other businesses, we were not spared the wrath of the pandemic which had a devastating impact on the one remaining active company, Bar Central Limited.“

During the year SSL Venture Capital saw revenues plummeted from $117 million in 2020 to just under $20 million for the year ended June 2021. The restrictions brought on by the Disaster Risk Management Act saw bars and places of amusement closed as restrictions intensify to curtail the spread of the deadly virus.

Zachary Harding, CEO of SSL Venture Capital.

Harding pointed out that, “with the significant decline in revenues, and the expectations of further headwinds from the pandemic, the executive management of SSL Venture Capital took a decision and recommended to the board that we shutter the operations of Bar Central Limited in December 2020. This was done to reduce continued operating expenses”.

Cost cutting measures in 2021

With this closure and further costs cutting measures that were implemented within the group, SSL Venture Capital were able to successfully reduce overall operating expenses from a high of $139.7 million in 2020 to $81.5 million for the 2021 financial year. During the year, the management also took a decision to impair the balance sheet, eliminating some of our non-current assets which we felt were of no real value to the company.

Some of this included goodwill for which the management wrote off the entire balance of $112 million from the prior year, as well as its deferred tax asset of $47.3 million. Related party obligations were also successfully negotiated with related companies.

The outcome of this exercise was a cleaner, leaner balance sheet but despite these adjustments SSL Venture Capital remains insolvent with current liabilities exceeding current assets by $73.2 million.

Outlook

The Board and Executive Management of SSL Venture Capital continue to deliberate on a plan for the company at this inflection point in the company’s history. Whilst the opportunity does present itself for a fresh injection of capital based on the restructured balance sheet, Harding said the COVID-19 pandemic continues to present headwinds for many entrepreneurs and investors who must pivot to continue the build-out of their vision. It is the hope that an outcome that protects shareholders interest will be realised soon.

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