Interim Results

Angle PLC 20 January 2005 For Immediate Release 20 January 2005 ANGLE plc ('ANGLE' or the 'Company') Interim results for the six months ended 31 October 2004 ANGLE plc, the intellectual property and technology commercialisation company, today announces its interim results for the six months ended 31 October 2004. Financial Highlights • Turnover increased 53% to £1.73 million (2003: £1.13 million) • Operating profit on Consulting and Management activities increased by 381% to £0.29 million (2003: £0.06 million) • Expenditure to establish and develop new Ventures increased substantially to £0.84 million (2003: £0.17 million) • Loss before tax increased to £1.37 million (2003: profit £0.01 million) reflecting planned expenditure on new Ventures development and provision for diminution in value of current asset investments of £1.03 million. • Earnings per share loss 8.18p (2003: loss 0.03p) • Cash at bank at half year end £7.25 million (2003: £2,907) • Consulting and Management businesses entered second half year with strong order book of £2.76 million (2003: £1.25 million). Operational Highlights • Acolyte Biomedica prepares for MRSA product launch in May 2005. Government emphasises need for rapid detection in fight against MRSA. Independent hospital analysis of product highly favourable. • NeuroTargets completes collaborative deal with BioFocus plc and appoints new CEO to drive commercialisation of proprietary drug targets. Additional funding secured to support BioFocus collaboration. • Provexis completes product development and establishes relationship with Nutrinnovator plc. Clinical trials demonstrate efficacy of CardioFlow(R) for cardiovascular health and suggest control of cholesterol an additional benefit. Launch of CardioFlow(R) in the form of a juice drink planned for Summer 2005. • Novocellus IVF diagnostic company founded to commercialise revolutionary technology for non-invasive testing of the viability of IVF embryos. • New Heads of Ventures appointed in the UK and US and teams strengthened with new recruits. • Negotiations in progress with major technology corporates, research establishments and universities for commercialisation of their intellectual property and several other potential Progeny(R) Companies under evaluation. Hance Fullerton, Chairman, commented: 'ANGLE has made good progress in the growth of its business during the first half of the year. Growth in the Consulting and Management businesses has been matched by development of the Ventures business. Our Ventures teams are now established in the UK and US, relationships have been further developed with leading technology organisations and progress made in evaluating and developing new venture propositions. Following the successful establishment of Novocellus in the first half of the year, we expect to announce the establishment of further Progeny(R) Companies in the second half. We are also making progress towards realising value for shareholders from our existing portfolio of Progeny (R) Companies.' Enquiries: ANGLE plc 01483 295830 Andrew Newland, Chief Executive Dawson Buck, Deputy Chief Executive Ian Griffiths, Finance Director Buchanan Communications 020 7466 5000 Richard Darby, Suzanne Brocks A presentation for analysts will take place today at 10.00am at the offices of Buchanan Communications, 107 Cheapside, London, EC2V 6DN. Please call Buchanan Communications for more details. Notes to Editors Founded in 1994, ANGLE is an international venture management and consulting group focusing on the commercialisation of technology and the development of technology-based industry. ANGLE creates, develops and advises technology businesses on its own behalf and for its clients. ANGLE is listed on AIM (AGL.L); further information can be found on www.ANGLEplc.com CHAIRMAN'S STATEMENT Introduction During the half year to 31 October 2004, ANGLE made good progress in developing its business in accordance with plans set out at flotation in March 2004. Results In the half year ended 31 October 2004, ANGLE increased turnover by 53% to £1.73 million (2003: £1.13 million). The loss before tax was £1.37 million (2003: profit £0.01 million), which was made up of interest of £0.13 million (2003: £3,917) and the following three elements: • Profit before tax on the Consulting and Management businesses increased by 381% to £0.29 million (2003: £0.06 million). • Loss before tax on the Ventures business increased to £0.75 million (2003: £0.05 million). This comprised revenues from existing ventures of £0.09 million (2003: £0.12 million) and planned expenditure to establish and develop new Ventures of £0.84 million (2003: £0.17 million). • A provision for diminution in value of investments of £1.03 million resulting from our holding in Corpora plc. Following its acquisitions of Exago, Infonic and Algorithmix, and the integration and development of its product suite, Corpora has recently reported improving revenues. The basic earnings per share loss increased to 8.18p (2003: loss 0.03p). Finance At the half year end, ANGLE had cash at bank of £7.25 million (2003: £2,907) reduced from the balance at the start of the year of £8.25 million. This reduction reflected planned expenditure to establish and develop new Ventures and working capital requirements for the Consulting and Management businesses. Progeny(R) Companies Significant progress has been made in expanding our Ventures capabilities and activities. Senior staff have been appointed to lead and develop new Ventures in both the UK and US markets, bringing experience from major corporate, management consulting and venture capital roles. During the period, we established Novocellus to commercialise intellectual property developed by the University of York. This company addresses an estimated £250 million p.a. world market for IVF assays and supports the drive for single embryo transfer. It has the potential to become a standard in all IVF treatment. We are in negotiation in the UK and the US with several major corporates and universities to agree the basis for commercialisation of their intellectual property. Outlook for the full financial year Trading indicators for the Consulting and Management businesses continue to be strong and we expect results for the year to be in line with our plans. The existing Progeny(R) Companies, Acolyte Biomedica, NeuroTargets and Provexis are expected to continue to achieve milestone performance and Novocellus is progressing through our Progeny(R) process. We are reviewing our commercialisation plans for IDR Therapeutics given changing market conditions. It is expected that further Progeny(R) Companies will be established in the second half of the year. Profitability in the Ventures side of the business for the year is dependent on the timing of realisation of existing Progeny(R) Companies. The Group continues to actively work with its Progeny(R) Companies to build value and develop them towards trade sale or IPO at an appropriate time in their development. Hance Fullerton Chairman OPERATIONS SUMMARY Founded in 1994, the Group's integrated business model combines its revenue-earning Consulting and Management businesses with its capital-growth Ventures business: • Consulting: consulting on the commercialisation of technology, including consulting for major corporations, SMEs, regional and national economic development agencies and governments; • Management: taking direct management responsibility for activities such as the operation of research parks and technology incubators and the management of innovation and product development programmes; and • Ventures: establishment and ownership of significant equity stakes in a portfolio of technology companies (Progeny(R) Companies), primarily in the biotechnology, electronics and IT sectors, with a view to realising value in the medium to long term. ANGLE has built profitable Consulting and Management businesses in the UK, US and Middle East, providing revenue and expert in-house staff capability as well as the opportunity to build important relationships with corporates, government research establishments and universities. The relationships with owners of intellectual property are a key channel for the Group to identify and exploit opportunities to commercialise intellectual property using its proprietary Progeny(R) process. The Consulting and Management businesses have performed strongly during the half year. Fees increased 62% to £1.64 million (2003: £1.01 million) resulting in a profit of £0.29 million (2003: £0.06 million) and an operating profit margin of 17.5% (2003: 5.9%). A number of major contracts were secured during the year and the order book is strong at £2.76 million (2003: £1.25 million). The Ventures business made good progress during the half year. The management teams in the UK and US were both strengthened with new recruits, and expenditure on the development of new ventures was progressed in accordance with the plans set out at the time of flotation. During the period, ANGLE founded its first new venture business since flotation, Novocellus Limited. Currently 100% owned by ANGLE, Novocellus has an exclusive option (in accordance with the Progeny(R) process) to intellectual property from the University of York, which will enable doctors to identify the viability of embryos leading to successful pregnancy in the first stage of IVF treatment. The technology, based on a non-invasive analysis of the embryo's amino acid profile, has the potential to deliver major financial and emotional cost benefits by making single embryo transfer a realistic target and thereby reducing the incidence of multiple births and increasing the likelihood of successful IVF treatment. The Company's ongoing strategy is to create more Progeny(R) Companies in the biosciences, electronics, optronics, IT, materials, nanotechnology and software sectors. Going into 2005 the Ventures opportunity pipeline is strong. ANGLE's business model, high calibre management and its Progeny(R) process have been recognised by many potential technology partners as bridging a critical gap in their intellectual property exploitation options. As a result ANGLE is evaluating new Venture opportunities with several of the UK's and US's top technology universities, key research organisations and FTSE 100 / Fortune 500 businesses. Substantial progress has been made in the half year in developing these business relationships and building new Ventures propositions. It is expected that further Progeny(R) businesses will be formed in the second half of the year. During the half year, good progress was made with ANGLE's other Progeny(R) Companies, including: • Acolyte Biomedica A medical technology company developing a range of products for rapid detection of sepsis, blood infections and antibiotic resistance. ANGLE's equity stake at the period end is 10.65%. The company's technology, BacLite(R) uses AK rapidTM technology developed by the Defence Science and Technology Laboratories (Dstl), an agency of the Ministry of Defence at Porton Down, Wiltshire. The Company has demonstrated through independent hospital analysis that it can detect hospital-acquired and other serious infections in hours rather than days using its cost-effective BacLite(R) platform. Acolyte is preparing to launch its first product - a rapid microbiology test for MRSA, 'the hospital super-bug', in May 2005. BacLite(R) rapid MRSA provides results in only 5 hours, which means that carriers of the bacterium can be isolated quickly, thus preventing the spread of infection. Rapid diagnosis also greatly improves the efficacy of treatment. BacLite(R) rapid MRSA provides hospitals with a cost effective tool to help achieve new UK Government targets for a 50% reduction in MRSA levels by 2008. www.acolytebiomedica.com • IDR Therapeutics A drug redevelopment company based in Charlottesville, Virginia that redesigns drugs to remove toxic side effects. ANGLE has a 64% stake. Major pharmaceutical companies have a strong need to bolster drug pipelines and deal with late stage failures or subsequent side effects. However, there have been changes in the dynamics of drug development that have impacted our original commercialisation plans. ANGLE is presently reviewing its commercialisation plan for IDR Therapeutics. It is expected that this review will be completed by the year end. • NeuroTargets A functional genomics company set up to discover and develop new drugs to treat diseases related to nerve damage. ANGLE's equity in NeuroTargets at the period end is 29.41%. During the half year additional funding was secured and a collaborative agreement was signed with BioFocus plc to develop compounds focusing on pain relief and nerve regeneration. At the same time a new CEO was appointed to drive commercialisation of the proprietary drug targets. www.neurotargets.co.uk • Provexis A nutraceutical company that develops functional foods, supplements and medical foods to improve cardiovascular health. ANGLE's equity in Provexis at the period end is 32.02%. Clinical trials were successfully completed during the half year. Provexis is launching its first product in Summer 2005, a juice drink containing CardioFlow(R) (the company's patented natural fruit extract which has been proven in human trials to 'thin' the blood and benefit the circulation). Provexis has collaborated with the Rowett Institute (a leading human nutrition research centre) over a four year period to develop and clinically test CardioFlow(R). Provexis is collaborating with Nutrinnovator plc to access their retail expertise in launching the product. www.provexis.com Following the sale of our Progeny(R) Company Exago to Corpora plc in a share for share exchange, ANGLE retains a holding of 16.82% at the period end in Corpora. Corpora plc is an AIM traded information management company supporting users of data to find, distil and learn the information they need, when they need it. The company's software solutions address geographically dispersed, information intensive organisations such as government, finance, legal and pharmaceutical. www.corporaplc.com ANGLE PLC CONSOLIDATED PROFIT AND LOSS ACCOUNT FOR THE SIX MONTHS ENDED 31 OCTOBER 2004 Note Six months ended Year ended 31 October 31 October 30 April 2004 2003 2004 (Unaudited) (Unaudited) (Audited) £ £ £ Turnover Consulting and Management 1,642,682 1,013,099 2,656,553 Ventures 88,612 118,117 219,257 _________ _________ _________ 1,731,294 1,131,216 2,875,810 Operating costs Consulting and Management (1,355,025) (953,281) (2,228,087) Ventures (839,838) (167,946) (674,918) _________ _________ _________ (2,194,863) (1,121,227) (2,903,005) Other operating income Ventures Profit on disposal of investments - - 2,309,281 Operating profit / (loss) Consulting and Management 287,657 59,818 428,466 Ventures (751,226) (49,829) 1,853,620 _________ _________ _________ (463,569) 9,989 2,282,086 Provision for diminution in value of current asset investments 5 (1,032,127) - - Net interest 130,094 3,917 46,384 _________ _________ _________ Profit / (loss) on ordinary activities before taxation (1,365,602) 13,906 2,328,470 Tax on profit / (loss) on ordinary activities 3 - (17,000) (37,850) _________ _________ _________ Retained profit / (loss) for the year (1,365,602) (3,094) 2,290,620 ========== ========== ========== Earnings per share 4 Basic (pence per share) (8.18) (0.03) 20.43 Diluted (pence per share) (8.18) (0.03) 19.45 The profit and loss account has been prepared on the basis that all operations are continuing operations. ANGLE PLC CONSOLIDATED STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES FOR THE SIX MONTHS ENDED 31 OCTOBER 2004 Six months ended Year ended 31 October 31 October 30 April 2004 2003 2004 (Unaudited) (Unaudited) (Audited) £ £ £ Retained profit / (loss) for the year (1,365,602) (3,094) 2,290,620 Currency translation differences 756 - (26,647) _________ _________ _________ Total gains and losses recognised in the period (1,364,846) (3,094) 2,263,973 ========== ========== ========== ANGLE PLC CONSOLIDATED BALANCE SHEET AS AT 31 OCTOBER 2004 Note Six months ended Year ended 31 October 31 October 30 April 2004 2003 2004 (Unaudited) (Unaudited) (Audited) £ £ £ Fixed assets Tangible assets 59,209 31,411 31,959 Investments 622,904 360,464 516,782 _________ _________ ________ 682,113 391,875 548,741 Current assets Investments 5 1,366,050 - 2,398,177 Debtors - due within one year 754,607 777,154 625,503 Debtors - due after one year 239,570 - 239,570 Cash at bank and in hand 7,247,827 2,907 8,246,871 _________ _________ ________ 9,608,054 780,061 11,510,121 Creditors: amount falling due within one year (665,829) (588,787) (1,063,116) _________ _________ ________ Net current assets 8,942,225 191,274 10,447,005 _________ _________ ________ Total assets less current liabilities 9,624,338 583,149 10,995,746 Creditors: amounts falling due after more than one year (2,446) (10,488) (6,354) _________ _________ ________ Net assets 9,621,892 572,661 10,989,392 ========== ========== ========= Capital and reserves Called up share capital 1,669,648 1,027,732 1,669,648 Share premium account 7,534,677 2,553,356 7,537,331 Profit and loss account (2,135,789) (3,008,427) (770,943) Other reserves 2,553,356 - 2,553,356 _________ _________ _______ Shareholders' funds - equity interests 6 9,621,892 572,661 10,989,392 ========== ========== ========= ANGLE PLC CONSOLIDATED CASH FLOW STATEMENT FOR THE SIX MONTHS ENDED 31 OCTOBER 2004 Six months ended Year ended 31 October 31 October 30 April 2004 2003 2004 (Unaudited) (Unaudited) (Audited) £ £ £ Net cash inflow / (outflow) from operating activities (977,085) (251,614) 48,592 Returns on investment and servicing of finance Interest received 134,037 230 10,960 Interest paid (1,816) (2,913) (7,307) ________ ________ _______ Net cash inflow / (outflow) from returns on investment and servicing of finance 132,221 (2,683) 3,653 Capital expenditure and financial investment Payments to acquire tangible fixed assets (39,188) - (15,218) Proceeds on disposal of tangible fixed assets - 1,542 650 Purchase of investments (106,122) - (106,317) ________ ________ _______ Net cash inflow / (outflow) for capital expenditure and financial investment (145,310) 1,542 (120,885) Acquisitions and disposals Net cash disposed of with subsidiaries - - - ________ ________ _______ Net cash outflow from acquisitions and disposals - - - Equity dividends paid - - - _______ _______ _______ Net cash outflow before management of liquid resources and financing (990,174) (252,755) (68,640) Financing Issue of ordinary share capital (2,654) - 8,269,775 Capital element of finance lease contracts (6,216) (10,354) (20,212) ________ ________ ________ Net cash inflow / (outflow) from financing (8,870) (10,354) 8,249,563 ________ ________ ________ Increase / (decrease) in cash in the year (999,044) (263,109) 8,180,923 ========= ========= ========= ANGLE PLC NOTES TO THE CONSOLIDATED CASH FLOW STATEMENT FOR THE SIX MONTHS ENDED 31 OCTOBER 2004 C1 Reconciliation of operating loss to net cash outflow from operating activities Six months ended Year ended 31 October 31 October 30 April 2004 2003 2004 (Unaudited) (Unaudited) (Audited) £ £ £ Operating profit / (loss) (1,495,696) 9,989 2,282,086 Depreciation of tangible fixed assets 11,790 15,874 30,823 Loss / (profit) on disposal of tangible fixed assets - (1,123) 118 (Increase) / decrease in current asset investments 1,032,127 - (2,398,177) (Increase) / decrease in debtors (131,232) (186,628) (332,361) Increase / (decrease) in creditors within one year (394,074) (89,726) 466,103 _________ _________ ________ Net cash inflow / (outflow) from operating activities (977,085) (251,614) 48,592 ========== ========== ========= C2 Analysis of net funds 1 May Cash flow Other non- 31 October 2004 cash changes 2004 (Audited) (Unaudited) (Unaudited) (Unaudited) £ £ £ £ Net cash: Cash at bank and in hand 8,246,871 (999,044) - 7,247,827 Debt: Finance leases (16,891) 6,216 - (10,675) ________ ________ ________ ________ Net funds 8,229,980 (992,828) - 7,237,152 ========= ========= ========= ========= C3 Reconciliation of net cash flow to movements in net (debt) / funds Six months ended Year ended 31 October 31 October 30 April 2004 2003 2004 (Unaudited) (Unaudited) (Audited) £ £ £ Increase / (decrease) in cash in the period (999,044) (263,109) 8,180,923 Cash outflow from reduction in debt 6,216 10,354 20,212 New finance leases - (6,764) (6,764) Exchange differences - - (26,647) ________ ________ ________ Movement in net (debt) / funds in the year (992,828) (259,519) 8,167,724 Opening net funds 8,229,980 56,245 62,256 ________ ________ ________ Closing net funds 7,237,152 (203,274) 8,229,980 ========= ========= ========= ANGLE PLC NOTES TO THE FINANCIAL INFORMATION FOR THE SIX MONTHS ENDED 31 OCTOBER 2004 1 Basis of preparation The interim financial statements, which do not constitute statutory accounts within the meaning of section 240 of the Companies Act 1985, have been prepared on the basis of the accounting policies set out in the statutory accounts of the Group for the year ended 30 April 2004. The interim financial statements, which were approved by the directors on 19 January 2005, are unaudited but have been reviewed in Accordance with Auditing Practices Board Bulletin 'Review of Interim Financial Information' by the auditors. Comparative figures for the year ended 30 April 2004 are an abridged version of the Group's full accounts which carry an unqualified audit report and have been delivered to the Registrar of Companies. 2 Compliance with accounting standards The Financial Statements are prepared in accordance with the Companies Act 1985 and applicable United Kingdom accounting standards. The directors have, in accordance with sections 226 and 227 of the Companies Act 1985, departed from the standard format of the profit and loss account in presenting the financial statements. Profits and losses on disposals of fixed asset investments, and provisions for diminution in value of fixed asset investments are included in 'Other operating income' within operating profit as these represent a return from a principal class of business activity. Other material disposals that are not part of the main business activities are shown below operating profit in accordance with the Companies Act 1985 and FRS3 - Reporting Financial Performance. Examples of such material disposals include fixed assets, such as property, or current asset investments, such as listed shares held for disposal in the short term. 3 Tax The Group is eligible for and takes advantage of the substantial shareholdings relief UK corporation tax exemption. This results in the gain from any disposals of UK investments where the Group has an equity stake greater than 10%, and subject to certain other tests, being free of corporation tax. Tax is therefore based on the net of profits in the Consulting and Management businesses as relieved by losses incurred in the establishment and development of new Ventures. 4 Earnings per share The basic and fully diluted earnings per share is calculated on an after tax loss of £1.37 million (6 months to 31 October 2003: loss £3,094, year to 30 April 2004: profit £2.29 million). The basic earnings per share is based on 16,696,484 weighted average ordinary 10p shares (6 months to 31 October 2003: 10,277,317 year to 30 April 2004: 11,209,904). Shares options are non-dilutive for the period because of the loss. The fully diluted earnings per share is based on 16,696,484 weighted average ordinary 10p shares (6 months to 31 October 2003: 10,277,317, year to 30 April 2004: 11,775,197). ANGLE PLC NOTES TO THE FINANCIAL INFORMATION (Continued) FOR THE SIX MONTHS ENDED 31 OCTOBER 2004 5 Current asset investments Six months ended Year ended 31 October 31 October 30 April 2004 2003 2004 (Unaudited) (Unaudited) (Audited) £ £ £ Net Book value 2,398,177 - - Additions - - 2,398,177 Provision for diminution in value (1,032,127) - - _________ _________ _________ Net Book value 1,366,050 - 2,398,177 ========== ========== ========== Market value Listed investments at period end 1,366,050 - 2,549,961 Current asset investments are valued at the lower of cost and mid-market value at the balance sheet date. They comprise shares in Corpora plc which is listed on the London Stock Exchange' Alternative Investment Market. 6 Reconciliation of movement in shareholders' funds Group Six months ended Year ended 31 October 31 October 30 April 2004 2003 2004 (Unaudited) (Unaudited) (Audited) £ £ £ Profit / (loss) for the period (1,365,602) (3,094) 2,290,620 Conversion of warrants - - 16,916 Gross proceeds from issue of shares - - 9,000,000 Issue expenses (2,654) - (837,669) Currency translation differences 756 - (26,647) _________ _________ _________ Net addition / (reduction) to shareholders' funds (1,367,500) (3,094) 10,443,220 Opening shareholders' funds 10,989,392 575,755 546,172 _________ _________ _________ Closing shareholders' funds 9,621,892 572,661 10,989,392 ========= ========= ========= 7 Shareholder communications The announcement is being sent to all shareholders on the register on 19 January 2005. Copies of this announcement are posted on the Company's website www.ANGLEplc.com and are available from Buchanan Communications and the Company's registered office: Surrey Technology Centre, Surrey Research Park, Guildford, GU2 7YG. ANGLE PLC INDEPENDENT REVIEW REPORT TO ANGLE PLC FOR THE SIX MONTHS ENDED 31 OCTOBER 2004 Introduction We have been instructed by the company to review the financial information set out on pages 7 to 13 and we have read the other information contained in the interim report and considered whether it contains any apparent misstatements or material inconsistencies with the financial information. This report, including the conclusion, has been prepared for and only for the company for the purpose of their interim report and for no other purpose. We do not, therefore in producing this report, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing. Directors' Responsibilities The interim statement, including the financial information contained therein, is the responsibility of, and has been approved by the directors. The directors are responsible for preparing the Interim Statement in accordance with the Alternative Investment Market Rules which require that the accounting policies and presentation applied to the interim figures must be consistent with those that will be adopted in the company's annual accounts. Review Work Performed We conducted our review in accordance with guidance contained in Bulletin 1999/4 issued by the Auditing Practices Board as if that Bulletin applied. A review consists principally of making enquiries of group management and applying analytical procedures to the financial information and underlying financial data and based thereon, assessing whether the accounting policies and presentation have been consistently applied unless otherwise disclosed. A review excludes audit procedures such as tests of controls and verification of assets, liabilities and transactions. It is substantially less in scope than an audit performed in accordance with Auditing Standards and therefore provides a lower level of assurance than an audit. Accordingly we do not express an audit opinion on the financial information. Review Conclusion On the basis of our review we are not aware of any material modifications that should be made to the financial information as presented for the six months ended 31 October 2004. BAKER TILLY Chartered Accountants Guildford This information is provided by RNS The company news service from the London Stock Exchange

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