Exhibit 99.1
OCEAN PARTNERS Y.O.D.M LTD.
FINANCIAL STATEMENTS
AS OF DECEMBER 31, 2019
OCEAN PARTNERS Y.O.D.M LTD.
FINANCIAL STATEMENTS
AS OF DECEMBER 31, 2019
INDEX TO FINANCIAL STATEMENTS
| Page | |
| Report of Independent Auditors | 2 |
| Statements of the Financial Position | 3 |
| Statements of Operations | 4 |
| Statements of Changes in Stockholders’ Equity | 5 |
| Notes to the Financial Statements | 6-11 |
| 1 |
REPORT OF INDEPENDENT AUDITORS
TO THE SHAREHOLDERS OF
Ocean Partners Y.O.D.M Ltd.
We have audited the accompanying balance sheets of Ocean Partners Y.O.D.M Ltd. (hereinafter: “the Company”) as of December 31, 2019 and 2018 and the related statements of operations and statements of changes in stockholders’ equity for each of the years then ended. These financial statements are the responsibility of the board of directors and management of the Company. Our responsibility is to express an opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards in Israel, including those prescribed by the Israeli Auditors’ Regulations (Mode of Performance), 1973. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by the board of directors and by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2019 and 2018, the results of its operations and its equity for each of the years then ended in conformity with accounting principles generally accepted in Israel (Israeli GAAP).
Jerusalem, Israel
March 26, 2020
| 2 |
OCEAN PARTNERS Y.O.D.M LTD.
STATEMENTS OF FINANCIAL POSITION
(In NIS)
| �� | December 31, | December 31, | ||||||||
| Note | 2019 | 2018 | ||||||||
| ASSETS | ||||||||||
| Current Assets | ||||||||||
| Cash and cash equivalents | 341,244 | 359,948 | ||||||||
| Short-term bank deposits | 3 | 40,738 | 270,989 | |||||||
| Trade receivables | 138,988 | 212,023 | ||||||||
| Accounts receivable | 4 | 130,643 | 59,501 | |||||||
| 651,613 | 902,461 | |||||||||
| Non-Current Assets | ||||||||||
| Fixed assets, net | 5 | 120,271 | 134,847 | |||||||
| 771,884 | 1,037,308 | |||||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||
| Current Liabilities | ||||||||||
| Trade payables | 41,818 | 45,552 | ||||||||
| Accounts payable | 6 | 83,498 | 179,232 | |||||||
| 125,316 | 224,784 | |||||||||
| STOCKHOLDERS’ EQUITY | ||||||||||
| Share capital | 7 | 10 | 10 | |||||||
| Additional paid-in capital | 869,990 | 869.,990 | ||||||||
| Accumulated deficit | (223,432 | ) | (57,476 | ) | ||||||
| 646,568 | 812,524 | |||||||||
| 771,884 | 1,037,308 | |||||||||
The accompanying notes are an integral part of the financial statements.
| March 26, 2020 | |||
| Date of Approval of Financial Statements | Chairman of the Board of Directors |
| 3 |
OCEAN PARTNERS Y.O.D.M LTD.
(In NIS)
| For the Year Ended December 31, | ||||||||||
| Note | 2019 | 2018 | ||||||||
| Revenues from management fees | 2,069,402 | 3,346,421 | ||||||||
| Operating costs | 9 | 1,368,445 | 1,912,626 | |||||||
| General and administrative costs | 10 | 918,645 | 1,292,372 | |||||||
| Operating profit (loss) | (217,688 | ) | 141,423 | |||||||
| Financing expenses, net | (3,268 | ) | (6,599 | ) | ||||||
| Operating profit (loss) prior to taxes on income | (220,956 | ) | 134,824 | |||||||
| Taxes on Income | 55,000 | - | ||||||||
| Net profit (loss) for the year | (165,956 | ) | 134,824 | |||||||
The accompanying notes are an integral part of the financial statements.
| 4 |
OCEAN PARTNERS Y.O.D.M LTD.
STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
(In NIS)
| Share | Additional Paid-in | Accumulated | Total Stockholders’ | |||||||||||||
| Capital | Capital | Deficit | Equity | |||||||||||||
| Balance as of January 1, 2018 | 10 | 869,990 | (192,300 | ) | 677,700 | |||||||||||
| Net income for the year | - | - | 134,824 | 134,824 | ||||||||||||
| Balance as of December 31, 2018 | 10 | 869,990 | (57,476 | ) | 812,524 | |||||||||||
| Loss for the year | - | - | (165,956 | ) | (165,956 | ) | ||||||||||
| Balance as of December 31, 2019 | 10 | 869,990 | (223,432 | ) | 646,568 | |||||||||||
The accompanying notes are an integral part of the financial statements.
| 5 |
OCEAN PARTNERS Y.O.D.M LTD.
NOTES TO THE FINANCIAL STATEMENTS
(In NIS)
NOTE 1 - GENERAL
Ocean Partners Y.O.D.M Ltd. (hereinafter: the “Company”) was established in August 2014. The Company engages in investment consultation, marketing of investments and portfolio management.
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES
The financial statements have been prepared in accordance with generally accepted accounting principles in Israel (“Israeli. GAAP”).
| A. | Cash and cash equivalents |
The Company considers all highly liquid investments, which include short-term bank deposits that are not restricted as to withdrawal or use, and short-term debentures, with original periods to maturity not exceeding three months, to be cash equivalents.
| B. | Short-term Deposits |
Deposits in banks for short periods, with initial time not in excess of three months from investment date.
| C. | Financial instruments |
The carrying amounts reported in the balance sheets for cash and cash equivalents, the bank deposit, account receivables, other current assets, suppliers, accounts payable and checks for cashing and accumulated expenses approximate their fair market value.
| D. | Fixed assets |
Fixed assets are stated at cost, net of accumulated depreciation. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets based on rates recognized for deductions by the Income Tax Authorities.
| E. | Revenue recognition |
The Company reports its revenues from services upon actual performance of the service.
| F. | Use of Estimates in Preparation of Financial Statements |
The preparation of consolidated financial statements in conformity with U.S. GAAP accounting principles requires management to make estimates and assumptions. The Company’s management believes that the estimates, judgments and assumptions used are reasonable based upon information available at the time they are made. These estimates, judgments and assumptions can affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements, and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates.
| 6 |
OCEAN PARTNERS Y.O.D.M LTD.
NOTES TO THE FINANCIAL STATEMENTS
(In NIS)
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES
| G. | Changes in the purchasing power of the Israeli currency |
These financial statements are prepared on the basis of “historical” cost without considering the changes that occurred in the purchasing power of the Israeli currency. During the reported year, the Consumer Price Index (CPI) decreased by 0.2% as compared with the prior year, when there was an increase of 0.8%.
| H. | Statement of cash flows |
These financial statements do not contain a statement of cash flows since it would not add significant financial information to what is contained in these financial statements.
| I. | Bookkeeping services |
The Company receives bookkeeping services from the accounting firm that audits its financial statements.
NOTE 3 - SHORT-TERM DEPOSITS
| December 31, | ||||||||
| 2019 | 2018 | |||||||
| Deposit in bank (*) | - | 238,187 | ||||||
| Trust account (**) | 40,738 | 32,802 | ||||||
| 40,738 | 270,989 | |||||||
| (*) | See notes 8A and 8D in regard to a charge placed on the deposit account. | |
| (**) | In order to guarantee the Company’s liability in accordance with the Standards for Transactions in regard to Financial Consultation in regard to Securities, Marketing of Investments and Managing Portfolios (Net Worth and Insurance), 2000, the trust account is held in Leumi Bank in the name of an attorney. |
NOTE 4 - ACCOUNTS RECEIVABLE
| December 31, | ||||||||
| 2019 | 2018 | |||||||
| Prepaid expenses | 69,943 | 24,000 | ||||||
| Income taxes | 5,700 | 35,501 | ||||||
| Deferred taxes | 55,000 | - | ||||||
| 130,643 | 59,501 | |||||||
| 7 |
OCEAN PARTNERS Y.O.D.M LTD.
NOTES TO THE FINANCIAL STATEMENTS
(In NIS)
NOTE 5 - FURNITURE AND FIXTURES, NET
| Furniture and | ||||||||||||
| Computers | Equipment | Total | ||||||||||
| A. Cost: | ||||||||||||
| Balance as of January 1, 2019 | 45,311 | 132,766 | 178,077 | |||||||||
| Additions during the year | 2,285 | - | 2,285 | |||||||||
| Balance as of December 31, 2019 | 47,596 | 132,766 | 180,362 | |||||||||
| Accumulated depreciation: | ||||||||||||
| Balance as of January 1, 2019 | (34,204 | ) | (9,025 | ) | (43,229 | ) | ||||||
| Additions during the year | (7,287 | ) | (9,575 | ) | (16,862 | ) | ||||||
| Balance as of December 31, 2019 | (41,491 | ) | (18,600 | ) | (60,091 | ) | ||||||
| Fixed assets, net as of December 31, 2019 | 6,105 | 114,166 | 120,271 | |||||||||
| Fixed assets, net as of December 31, 2018 | 11,747 | 123,100 | 134,847 | |||||||||
| B. Depreciation rates | 33 | % | 6%-33% | |||||||||
NOTE 6 - ACCOUNTS PAYABLE
| December 31, | ||||||||
| 2019 | 2018 | |||||||
| Expenses payable | 55,869 | 118,876 | ||||||
| Institutions | 10,535 | 26,230 | ||||||
| Salaries and related items | 17,094 | 34,126 | ||||||
| 83,498 | 179,232 | |||||||
NOTE 7 - SHARE CAPITAL
| December 31, | ||||||||
| 2019 and 2018 | ||||||||
| Number of shares: | Authorized | Issued and Outstanding | ||||||
| Ordinary shares of NIS 0.01 par value each | 100,000 | 10 | ||||||
| 8 |
OCEAN PARTNERS Y.O.D.M LTD.
NOTES TO THE FINANCIAL STATEMENTS
(In NIS)
NOTE 8 - COMMITMENTS, CHARGES AND GUARANTEES
| A. | The Company signed a rental agreement for offices located at 2 Weizman Street in Tel Aviv. Monthly rental fees are in the amount of approximately NIS 33 thousand (not including VAT). Rental period is until April 14, 2022. During August 2019, the Company vacated the rental premises. Upon termination of the rental agreement, the bank guarantee was nullified (see Note 8 - guarantees and charges). | |
| B. | The Company contracted for rendering investment management services to a third party who manages trust funds (Model Trust Funds Ltd.). According to the agreement, the Company will receive as consideration for management services the total management fees and a percentage of increase that will be collected from the trust funds that are receiving the services, net of costs, as agreed upon between the parties. The agreement is for an indefinite period. In addition, the Company bears the costs of hosting a company related to the fund management by payment of a fixed monthly sum for each fund. | |
| C. | The Company signed a rental agreement, commencing August 2019, for offices on 7 Menachem Begin Street in Ramat Gan. The monthly rental fees are approximately NIS 10 thousand (not including VAT). The rental period is indefinite. Cessation of the rental period will be upon a written warning rendered three months in advance. | |
| Guarantees and Charges: | ||
| D. | In order to guarantee the Company’s liabilities to its landlords, the Company gave a bank guarantee in the amount of NIS 202 thousand and placed a fixed charge on a deposit in the amount of NIS 202 thousand that is in the bank (See Notes 3 and 8A). As of the date of the financial statements, the charge has not as yet been removed. | |
| Value of the Managed Portfolios: | ||
| As of December 31, 2019 the Company manages in trust investment portfolios that have an inclusive value of approximately NIS 89 million and trust funds that have an inclusive value of approximately NIS 367 million (as of December 31, 2018 approximately NIS 58 million and NIS 592 million, respectively). |
| 9 |
OCEAN PARTNERS Y.O.D.M LTD.
NOTES TO THE FINANCIAL STATEMENTS
(In NIS)
NOTE 9 - OPERATING EXPENSES
| Year Ended December 31, | ||||||||
| 2019 | 2018 | |||||||
| Salaries and related items | 256,749 | 497,723 | ||||||
| Rental fees | 403,709 | 524,371 | ||||||
| Fund management and operation | 244,752 | 259,000 | ||||||
| Maintenance | 193,125 | 248,636 | ||||||
| Work contracted out – marketing advice | 80,228 | 132,634 | ||||||
| Advertising and marketing | 6,201 | 38,396 | ||||||
| Insurance for professional accountability | 48,646 | 56,094 | ||||||
| Vehicle costs | 46,126 | 54,895 | ||||||
| Information and stock exchange costs | 60,614 | 61,838 | ||||||
| Fees and membership dues | 28,295 | 39,039 | ||||||
| 1,368,445 | 1,912,626 | |||||||
NOTE 10 - GENERAL AND ADMINISTRATIVE EXPENSES
| Year Ended December 31, | ||||||||
| 2019 | 2018 | |||||||
| Management fees for directors | 842,000 | 1,212,180 | ||||||
| Professional services | 48,805 | 36,709 | ||||||
| Hospitality and gifts | 2,813 | 21,204 | ||||||
| Other | 8,165 | 7,787 | ||||||
| Depreciation expenses | 16,862 | 14,492 | ||||||
| 918,645 | 1,292,372 | |||||||
| 10 |
OCEAN PARTNERS Y.O.D.M LTD.
NOTES TO THE FINANCIAL STATEMENTS
(In NIS)
NOTE 11 - RELATED PARTIES
| A. | Balances and transactions with related parties |
| Year Ended December 31, | ||||||||
| 2019 | 2018 | |||||||
| Data for results: | ||||||||
| Management fees for directors (see Note 10) | 842,000 | 1,212,180 | ||||||
| December 31 | ||||||||
| 2019 | 2018 | |||||||
| Balance sheet items: | ||||||||
| Expenses payable | 50,000 | 75,000 | ||||||
| 11 |