Interim Results

RNS Number : 2135V

Omega Diagnostics Group PLC

02 December 2019

 

OMEGA DIAGNOSTICS GROUP PLC

("Omega" or the "Company" or the "Group")

INTERIM RESULTS

FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2019

Omega (AIM: ODX), the medical diagnostics company focused on CD4, food intolerance and allergy testing, announces its unaudited interim results for the six months ended 30 September 2019.

Omega provides high quality in-vitro diagnostics products for use in hospitals, clinics, laboratories and healthcare practitioners in over 75 countries and specialise in the areas of allergy and autoimmune, food intolerance and infectious disease. These results reflect the actions taken last year as part of the Board's strategic review to divest the non-core infectious disease business and to close the German allergy business. 

 

Financial Highlights:

·      Revenue from continuing operations increased by 6% to £4.46m (2018: £4.22m)

·      Reported revenue, including discontinued operations, reduced by 15% at £4.46m (2018: £5.23m)

·      Significant improvement in gross margin from continuing operations - up by 5.8 percentage points to 67.5% (2018: 61.7%)

·      Statutory loss for the period of £0.29m (2018: profit of £1.04m)

·      Adjusted loss before tax¹ of £0.35m (2018: adjusted loss before tax of £0.51m)

·      EBITDA from continuing operations of £0.25m (2018: loss of £0.22m)

·      Adjusted earnings per share¹ of -0.2p (2018: -0.5p)

¹Adjusted for exceptional items, amortisation of intangible assets and share based payment charges 

Operational Highlights:

·      Placing and subscription for £1.7m completed on 10 October 2019

·      65 allergens CE marked to run on the IDS automated instrument including first screening assay

·      First order for 20,000 Food Detective tests shipped to our strategic partner in China

·      A second order for 30,000 Food Detective tests to be shipped to our strategic partner in China in November

·      VISITECT^® CD4 350 cut off test evaluation report written and submitted to the Nigerian Ministry of Health

·      A second conditional order of 200,000 CD4 350 tests as announced separately today

·      VISITECT^® CD4 Advanced Disease test (utilising a lower 200 cut-off) receives ERPD approval

Regarding outlook, William Rhodes, Interim Chairman, said:

"I am encouraged that we continue to make progress across all three divisions. Our financial performance was aligned to our expectations and is further indication that the restructuring we undertook in the prior year is having a positive impact.  The recent fundraise also provides us with sufficient funding to implement our short term strategies, and I would like to thank all our shareholders who participated. 

"In summary, we have continued to make progress against our plans, and are well positioned for near term growth in both our food intolerance and CD4 business units."

The information communicated in this announcement is inside information for the purposes of Article 7 of EU Regulation 596/2014.

Contacts: 

Omega Diagnostics Group PLC	Tel: [phone]
Bill Rhodes, Interim Non-Executive Chairman Colin King, Chief Executive	www.omegadiagnostics.com
Kieron Harbinson, Group Finance Director
	Mob: [phone]
finnCap Ltd	Tel: [phone]
Geoff Nash/Hannah Boros (Corporate Finance)
Camille Gochez (Corporate Broking)
Walbrook PR Limited	Tel: [phone] or [e-mail]
Paul McManus	Mob: [phone]
Lianne Cawthorne	Mob: [phone]

Chairman's Statement

Financial performance

Revenue from continuing operations increased by 6% to £4.46m (2018: £4.22m) predominantly due to the performance in our Food Intolerance division as described below. Total revenue, for the six months ended 30 September 2019 reduced by 15% to £4.46m (2018: £5.23m) with the reduction attributable to the divestment of our legacy infectious disease division and the decision to close our German and Indian manufacturing facilities, in the prior period. 

Food Intolerance revenue increased by 6% to £4.08m over the prior period (2018: £3.84m). Two customer orders amounting to £0.2m, were ready to be shipped prior to 30 September 2019 but were not picked up by customers' freight companies until the first week of October. Accordingly, this revenue has not been included in our H1 results in line with our revenue recognition policy. Had this been included, our Food Intolerance division would have recorded revenue growth of 11%.

Sales of our FoodPrint® laboratory reagents increased by 12% to £2.67m (2018: £2.39m) with growth in four of our five top markets as measured by revenue. Sales of Food Detective® were mainly in line with the prior period at £0.96m (2018: £0.99m) with an uplift of £0.29m of sales to our new Chinese partners offsetting £0.12m of sales shipped in the first week of October (as noted above).

Sales in both the Allergy/Autoimmune and Infectious disease divisions are now proportionately much less of our total sales, following the divestitures and closures noted above, and respectively achieved sales of £0.26m (2018: £0.21m) and £0.12m (2018: £0.18m). In the main, these sales are achieved in India through our wholly owned subsidiary.

Gross profit from continuing operations increased by 16% to £3.01m (2018: £2.61m) with the gross margin percentage increasing by 5.8 percentage points to 67.5% (2018: 61.7%). The increase in margin is due to an improved product mix weighting towards FoodPrint® and significantly reduced levels of scrap compared to the prior period. The adjusted loss before tax from continuing operations was in line with management's expectation at £0.35m (statutory loss before tax of £0.41m and adding back amortisation of intangibles and share-based payment charges totalling £0.06m) (2018: adjusted loss before tax of £0.43m).

Administrative overheads from continuing operations increased by £0.22m to £2.63m (2018: £2.41m); the majority of this increase relates to amortisation of the Allergy and VISITECT^® CD4 intangible assets. The allergy assets commenced amortisation with effect from 1 April 2019 and the CD4 assets commenced amortisation with effect from 1 August 2019, in line with the respective commercial launches of these products. Selling and marketing costs from continuing operations remained broadly the same at £0.74m (2018: £0.77m).

The tax credit in the year of £0.04m relates to SME R&D tax credits as compared to a tax charge of £0.1m in the prior period where SME R&D tax credits were offset by a tax charge having arisen in the prior period on the sale of the legacy infectious disease business, which accounts for the majority of the movement.

IFRS 16 - Leases

The Group has adopted IFRS 16 for its accounting period beginning on 1 April 2019. The effect of this is to treat previously recognised operating leases as finance leases. IFRS 16 captures agreements covering the Group's rental of its existing premises in Alva, Scotland and Ely, England, along with the rent of certain office equipment. The financial effect is that from 1 April 2019, the Group has recognised right of use assets totalling £1.93m with a corresponding liability for the same amount. Depreciation is charged through the profit and loss account on a straight line basis over the term of the lease. Interest is calculated on the outstanding liability, using the Group's current borrowing rate, and is charged through the profit and loss account. Rent payments, which previously would have been charged to profit and loss account (under the treatment of operating leases) are now treated as deductions of the applicable outstanding financial liabilities on the balance sheet. In the six month period to 30 September 2019, the Group has charged depreciation of £108,819 and interest expense of £72,807 through the profit and loss account and made lease payments totalling £152,453. The effect of adopting IFRS 16 is that both the statutory and adjusted loss before tax has been increased by £29,173.

VISITECT^® CD4 350 test

We have continued to make progress in signing distribution agreements and now have distributors in 19 countries for the 350 test, to nine of which have been added the Advanced Disease test. There are a further three countries for which distribution discussions are continuing.

We are still awaiting the outcome from the Nigerian Ministry of Health, following completion and submission of the evaluation report in October and we continue to remain confident about the prospects for Nigeria being the largest market for the 350 test.

VISITECT^® CD4 Advanced Disease test

As noted above, we have made good progress with appointing distribution partners in our target countries.  As also announced previously, we received an order from Zimbabwe and we expect to receive further seeding orders from other countries for the remainder of the financial year.

Following receipt of ERPD approval announced in September, we are in discussions with the Clinton Health Access Initiative ("CHAI") who act on behalf of UNITAID to implement their Advanced disease initiative. CHAI has identified four countries to act as early adopters of our VISITECT^® CD4 Advanced Disease test, providing a test bed to implement CHAI's advanced disease programme. CHAI are currently working with these countries' Ministries of Health to identify how they will execute this programme. Once this task is complete, we expect to receive indication of demand from each of these countries. 

We are making good progress with the WHO Prequalification ("WHO PQ") process. This is a three-phase programme comprising:

·      a review of the Company's technical file

·      a performance evaluation of our test

·      a site inspection and audit of our quality management system

We expect the technical review phase to complete by the end of the calendar year (currently at 90%).  Secondly, we expect to complete the drafting of the performance evaluation protocol and to have decided on the evaluation site by the calendar year end.  This will allow the evaluation to commence in Quarter 1 of calendar 2020.  Thirdly, the site inspection and audit of the Alva, UK facility is scheduled for January 2020.   Successful completion of the three phases noted above leads to approval under the WHO PQ programme which allows full procurement by United Nations organisations.

Outlook

I am encouraged that we continue to make progress across all three divisions.  Our financial performance was aligned to our expectations and is further indication that the restructuring we undertook in the prior year is having a positive impact.  The recent fundraise also provides us with sufficient funding to implement our short term strategies, and I would like to thank all our shareholders who participated. 

Our food Intolerance division continues to grow and we remain confident that this unit will deliver double digit revenue growth in the current financial year, helped by our new Chinese partner having placed stocking orders for 50,000 units in preparation for their expected regulatory approval in China.

I am also encouraged by the progress we have made with our VISITECT^® CD4 products. As announced separately today, our partner in Nigeria has ordered a further 200,000 CD4 350 tests, deliverable in January to March. This order is additional to the 50,000 test order previously announced and both orders remain conditional on receiving approval from the Nigerian Ministry of Health. We remain confident of receiving this in due course.

Following receipt of ERPD approval for our Advanced Disease test, we continue to engage with multiple stakeholders to ensure this version of our test is adopted early in countries with most need. In parallel, we have made progress with the WHO prequalification programme and the product evaluation and site audit are expected to commence in from January next year.

Médecins Sans Frontières are evaluating our Advanced Disease test in a number of countries and will be presenting two posters at the International Conference on AIDS and Sexually Transmitted Infections in Africa in Rwanda this week, highlighting the excellent performance of our test.

In summary, we have continued to make progress against our plans, and are well positioned for near term growth in both our food intolerance and CD4 business units.

William Rhodes

Interim Non-Executive Chairman

Consolidated Statement of Comprehensive Income
for the six months ended 30 September 2019
6-month period ended 30 September 2019 6-month period ended 30 September 2018 Continuing Discontinued Continuing Discontinued Notes operations operations Total operations operations Total £ £ £ £ £ £ Revenue 3 4,464,337 - 4,464,337 4,224,889 1,002,646 5,227,535 Cost of sales (1,450,833)  - (1,450,833) (1,618,225) (464,136) (2,082,361) Gross profit 3,013,504 - 3,013,504 2,606,664 538,510 3,145,174 Administration costs (2,632,792) - (2,632,792) (2,405,656) (440,874) (2,846,530) Selling and marketing costs (744,011) - (744,011) (765,626) (195,205) (960,831) Other operating income 82,643  - 82,643 61,026 - 61,026 Operating loss before exceptional items (280,656) - (280,656) (503,592) (97,569) (601,161) Exceptional items: Gain on sale of legacy infectious disease business - - - - 1,091,808 1,091,808 Omega GmbH liabilities write off - 78,493 78,493 - 676,113 676,113 Operating (loss)/profit after exceptional items (280,656) 78,493 (202,163) (503,592) 1,670,352 1,166,760 Finance costs 4 (128,656) - (128,656) (25,599) - (25,599) Finance revenue - interest receivable -  - - 11 - 11 (Loss)/profit before taxation (409,312) 78,493 (330,819) (529,180) 1,670,352 1,141,172 Tax credit/(charge) 5 87,956 (43,630) 44,326 134,830 (237,154) (102,324) (Loss)/profit for the period (321,356) 34,863 (286,493) (394,350) 1,433,198 1,038,848 Other comprehensive income to be reclassified to profit and loss in subsequent periods Exchange differences on translation of foreign operations (25,882) (78,493) (104,375) 30,605 - 30,605 Tax charge 5 (1,938)                     - (1,938) (5,124) - (5,124) Other comprehensive income for the period (27,820) (78,493) (106,313) 25,481 - 25,481 Total comprehensive income for the period (349,176) (43,630) (392,806) (368,869) 1,433,198 1,064,329 Earnings Per Share (EPS) Basic EPS on profit for the period 6 (0.2p) 0.6p Diluted EPS on profit for the period (0.2p) 0.6p Adjusted Loss before Taxation 6-month period ended 30 September 2019 6-month period ended 30 September 2018 Continuing Discontinued Continuing Discontinued operations operations Total operations operations Total £ £ £ £ £ £ (Loss)/profit before taxation (409,312) 78,493 (330,819) (529,180) 1,670,352 1,141,172 Exceptional items - (78,493) (78,493) - (1,767,921) (1,767,921) Amortisation of intangible assets 57,639 - 57,639 65,474 24,573 90,047 Share-based payment charges 4,732 - 4,732 30,000 - 30,000 Adjusted loss before taxation (346,941) - (346,941) (433,706) (72,996) (506,702) Earnings Per Share (EPS) Basic and diluted Adjusted EPS on profit for the period 6 (0.2p) (0.5p) Adjusted loss before stated before exceptional items, amortisation of intangible assets and share based payment charges.

Consolidated Balance Sheet
as at 30 September 2019
At 30 Sept At 31 March At 30 Sept 2019 2019 2018 £ £ £ Assets Non-current assets   Intangibles 17,754,266 17,044,293 15,740,459   Property, plant and equipment 3,284,952 1,569,581 1,667,085   Deferred taxation 1,549,944 1,371,260 1,287,785 Total non-current assets 22,589,162 19,985,134 18,695,329 Current assets   Inventories 1,237,922 1,000,700 1,110,767   Trade and other receivables 2,597,772 2,489,389 2,692,975   Deferred consideration - - 375,000 Total current assets 3,835,694 3,490,089 4,178,742 Total assets 26,424,856 23,475,223 22,874,071 Equity and liabilities Issued capital 20,407,138 19,797,343 19,797,343 Retained earnings (1,960,805) (1,677,106) (1,621,745) Other reserves (33,970) 70,405 40,887 Total equity 18,412,363 18,190,642 18,216,485 Liabilities Non-current liabilities   Long term borrowings 1,823,192 78,478 136,100   Deferred taxation 2,172,889 2,036,593 1,748,247   Deferred income 991,786 864,255 481,752 Total non-current liabilities 4,987,867 2,979,326 2,366,099 Current liabilities   Trade and other payables 1,485,257 1,461,973 1,719,507   Bank overdraft 1,394,260 744,708 452,200   Short term borrowings 145,109 98,574 103,082   Tax payable - - 16,698 Total current liabilities 3,024,626 2,305,255 2,291,487 Total liabilities 8,012,493 5,284,581 4,657,586 Total equity and liabilities 26,424,856 23,475,223 22,874,071 Consolidated Statement of Changes in Equity for the six months ended 30 September 2019
Issued Retained Translation Capital earnings reserve Total £ £ £ £ Balance at 1 April 2018 19,797,343 (2,685,469) 10,282 17,122,156 Profit for the period to 30 September 2018 - 1,038,848 - 1,038,848 Other comprehensive income-net exchange adjustments - - 30,605 30,605 Other comprehensive income-tax charge - (5,124) - (5,124) Total comprehensive income - 1,033,724 30,605 1,064,329 Share-based payments - 30,000 - 30,000 Balance at 30 September 2018 19,797,343 (1,621,745) 40,887 18,216,485 Loss for the period to 31 March 2019 - (64,595) - (64,595) Other comprehensive income-net exchange adjustments - - (12,368) (12,368) Other comprehensive income-net exchange adjustments recycled - 41,886 41,886 Other comprehensive income-tax credit - 5,033 - 5,033 Total comprehensive income - (59,562) 29,518 (30,044) Share-based payments - 4,201 - 4,201 Balance at 1 April 2019 19,797,343 (1,677,106) 70,405 18,190,642 Issue of share capital for cash 634,795 - - 634,795 consideration Expenses in connection with share issue (25,000) - - (25,000) Loss for the period to 30 September 2019 - (286,493) - (286,493) Other comprehensive income-net exchange adjustments - - (104,375) -104,375 Other comprehensive income-net exchange adjustments recycled - - - Other comprehensive income-tax charge - (1,938) - (1,938) Total comprehensive income - (288,431) (104,375) (392,806) Share-based payments - 4,732 - 4,732 Balance at 30 September 2019 20,407,138 (1,960,805) (33,970) 18,412,363
Consolidated Cash Flow Statement
for the six months ended 30 September 2019
6 months 6 months to 30 Sept to 30 Sept 2019 2018 £ £ Cash flows generated from operations (Loss)/profit for the period after exceptional items (286,493) 1,038,848 Adjustments for: Taxation (44,326) 102,324 Finance costs 128,656 25,599 Finance income - (11) Operating (loss)/profit after exceptional items (202,163) 1,166,760 (Increase)/decrease in trade and other receivables (243,989) 276,435 (Increase)/decrease in inventories (237,222) 86,371 Increase/(decrease) in trade and other payables 23,284 (1,211,411) Depreciation 219,843 192,999 Amortisation of intangible assets 306,742 90,047 Movements in grants 127,531 124,392 Taxation received 135,606 - Gain/(Loss) on sale of fixed assets 3,672 - Exceptional item-Gain on sale of legacy infectious disease business - (1,091,808) Exceptional item-Omega GmbH liabilities write off (78,493) (676,113) Share-based payments 4,732 30,000 Net cash flow from operating activities 59,543 (1,012,328) Investing activities Finance income - 11 Purchase of property, plant and equipment (56,583) (231,262) Right of Use Asset under IFRS16 (1,933,784) - Purchase of intangible assets (964,309) (1,034,153) Sale proceeds from legacy infectious disease business - 1,800,000 Net cash used in investing activities (2,954,676) 534,596 Financing activities Finance costs (55,850) (25,599) Finance costs - ROU interest under IFRS16 (72,806) - Proceeds from issue of share capital 634,795 - Expenses of share issue (25,000) - New finance leases - 40,500 Right of Use Lease Liability under IFRS16 1,933,784                  - Drawdown of overdraft facility 649,552 452,200 Finance lease repayments (62,888) (69,529) ROU Lease repayments under IFRS16 (79,647)                  - Net cash from financing activities 2,921,940 397,572 Net Increase/(decrease) in cash and cash equivalents 26,807 (80,160) Effects of exchange rate movements (26,807) (35,559) Cash and cash equivalents at beginning of period - 115,719 Cash and cash equivalents at end of period - -

Notes to the Interim Report

for the six months ended 30 September 2019

1. BASIS OF PREPARATION

For the purpose of preparing the March 2019 annual financial statements the Directors used IFRS as adopted by the EU and in accordance with the AIM Rules issued by the London Stock Exchange. In preparing these interim financial statements, the accounting policies used in the Group's Annual Report for the year ended 31 March 2019 have been applied consistently. The Group has not applied IAS 34 Interim Financial Reporting, which is not mandatory for AIM companies, in the preparation of these interim financial statements.

The interim financial statements are unaudited. The information shown in the consolidated balance sheet as at 31 March 2019 does not constitute statutory accounts as defined in Section 435 of the Companies Act 2006 and has been extracted from the Group's 2019 Annual Report which has been filed with the Registrar of Companies. The report of the auditors on the financial statements contained within the Group's 2018 Annual Report was unqualified and did not contain a statement under sections 498 (2) and 498 (3) of Chapter 3, Part 16 of the Companies Act 2006.  These interim financial statements were approved by the Board of Directors on 29 November 2019.

2. SEGMENT INFORMATION

For management purposes the Group is organised into three operating divisions: Allergy and Autoimmune, Food Intolerance and Infectious Disease and Other.

The Allergy and Autoimmune division specialises in the research, development, production and marketing of in-vitro allergy and autoimmune tests used by doctors to diagnose patients with allergies and autoimmune diseases.

The Food Intolerance division specialises in the research, development and production of kits to aid the detection of immune reactions to food. It also provides clinical analysis to the general public, clinics and health professionals as well as supplying the consumer Food Detective test.

The Infectious Diseases division specialises in the research, development and production and marketing of kits to aid the diagnosis of infectious diseases.

Corporate consists of centralised corporate costs which are not allocated across the three business divisions.

Inter segment transfers or transactions are entered into under the normal commercial conditions that would be available to unrelated third parties.

Business segment information - Continuing operations
									Allergy &				Food				Infectious /
									Autoimmune				Intolerance				Other			Corporate					Group
September 2019									£				£				£			£					£
Statutory presentation
Revenue									300,751				4,184,615				120,383			-					4,605,749
Inter-segment revenue									(40,212)				(101,200)				-			-					(141,412)
Total revenue									260,539				4,083,415				120,383			-					4,464,337
Cost of sales									(53,840)				(1,121,183)				(275,810)			-					(1,450,833)
Gross profit/(loss)									206,699				2,962,232				(155,427)			-					3,013,504
Operating costs									(345,400)				(1,326,792)				(1,122,844)			(499,124)					(3,294,160)
Operating (loss)/profit before exceptional items									(138,701)				1,635,440				(1,278,271)			(499,124)					(280,656)
Share-based payment charges									-				-				-			4,732					4,732
Depreciation									6,344				118,223				95,277			-					219,844
Amortisation - non add back									216,371				-				32,731			-					249,102
Amortisation									320				50,322				6,997			-					57,639
EBITDA									84,334				1,803,985				(1,143,266)			(494,392)					250,661
Share-based payment charges									-				-				-			(4,732)					(4,732)
Depreciation									(6,344)				(118,223)				(95,277)			-					(219,844)
Amortisation - non add back									(216,371)				-				(32,731)			-					(249,102)
Amortisation									(320)				(50,322)				(6,997)			-					(57,639)
Net finance costs									(350)				(6,640)				(71,016)			(50,650)					(128,656)
(Loss)/profit before tax									(139,051)				1,628,800				(1,349,287)			(549,774)					(409,312)
Share-based payment charges									-				-				-			4,732					4,732
Amortisation									320				50,322				6,997			-					57,639
Adjusted (loss)/profit before tax									(138,731)				1,679,122				(1,342,290)			(545,042)					(346,941)
										Allergy &					Food			Infectious /
										Autoimmune					Intolerance			Other			Corporate					Group
September 2018										£					£			£			£					£
Statutory presentation
Revenue										208,366					3,891,702			226,924			-					4,326,992
Inter-segment revenue										-					(56,239)			(45,864)			-					(102,103)
Total revenue										208,366					3,835,463			181,060			-					4,224,889
Cost of sales										(163,856)					(1,198,388)			(255,981)			-					(1,618,225)
Gross profit/(loss)										44,510					2,637,075			(74,921)			-					2,606,664
Operating costs										(107,834)					(1,239,708)			(719,771)			(1,042,943)					(3,110,256)
Operating (loss)/profit before exceptional items										(63,324)					1,397,367			(794,692)			(1,042,943)					(503,592)
Share-based payment charges										-					-			-			30,000					30,000
Depreciation										28,854					117,903			46,242			-					192,999
Amortisation										1,816					53,502			10,156			-					65,474
EBITDA										(32,654)					1,568,772			(738,294)			(1,012,943)					(215,119)
Share-based payment charges										-					-			-			(30,000)					(30,000)
Depreciation										(28,854)					(117,903)			(46,242)			-					(192,999)
Amortisation										(1,816)					(53,502)			(10,156)			-					(65,474)
Net finance costs										-					-			(5,390)			(20,198)					(25,588)
(Loss)/profit before tax										(63,324)					1,397,367			(800,082)			(1,063,141)					(529,180)
Share-based payment charges										-					-			-			30,000					30,000
Amortisation										1,816					53,502			10,156			-					65,474
Adjusted (loss)/profit before tax										(61,508)					1,450,869			(789,926)			(1,033,141)					(433,706)
	3. REVENUES Continuing Operations
															6 months				6 months
															to 30 Sept				to 30 Sept
															2019				2018
															£				£
UK															288,804				323,471
Europe															1,474,214				1,352,693
North America															765,389				759,023
South/Central America															211,394				305,112
India															403,889				350,027
Asia and Far East															795,389				766,919
Africa and Middle East															525,258				367,644
															4,464,337				4,224,889

4. FINANCE COSTS

						6 months		6 months
						to 30 Sept		to 30 Sept
						2019		2018
						£		£
Interest payable						52,096		21,594
Finance charges payable under finance leases						76,560		4,005
						128,656		25,599

5. TAX CREDIT/(CHARGE)

						6 months		6 months
						to 30 Sept		to 30 Sept
						2019		2018
						£		£
Tax credited/(charged) in the income statement
Current tax - current year						-		(16,698)
Deferred tax - current year						99,125		(111,408)
Deferred tax - prior year adjustment						(54,799)		25,782
						44,326		(102,324)
Tax relating to items charged to other comprehensive income
Deferred tax on net exchange adjustments						(1,938)		(5,124)
						(1,938)		(5,124)
Reconciliation of total tax charge
Factors affecting the tax charge for the period:
(Loss)/profit taxable						(409,312)		1,141,172
Effective rate of taxation						19%		19%
(Loss)/profit before tax multiplied by the effective rate of tax						(77,769)		216,823
Effects of:
Expenses not deductible for tax purposes and permanent differences						(59)		37,135
Research and development tax credits						(42,460)		(48,632)
Deferred tax asset on losses in year not recognised						(3,107)		110,090
Tax under/(over) provided in prior years						11,169		(25,782)
Adjustment due to different overseas tax rate						12,539		(39,610)
Exceptional items (relating to closed German / Indian operations)						43,630		(128,462)
Impact of UK rate change on deferred tax						11,731		(19,238)
Tax (credit)/charge for the period						(44,326)		102,324

6. EARNINGS PER SHARE

	6 months to 30 Sept 2019	6 months to 30 Sept 2018
	£	£
(Loss)/Profit attributable to equity holders of the Group	(286,493)	1,038,848
	2019 Number	2018 Number
Weighted average number of shares	129,109,732	126,959,060
Share options	307,062	306,718
Diluted weighted average number of shares	129,416,794	127,265,778

The number of shares in issue at the period end was 133,307,010. Basic earnings per share are calculated by dividing profit for the year attributable to ordinary equity holders of the Group by the weighted average number of ordinary shares outstanding during the year.

Diluted earnings per share are calculated by dividing the profit attributable to ordinary equity holders of the Group by the weighted average number of ordinary shares outstanding during the year plus the weighted average number of ordinary shares that would be issued on the conversion of all the dilutive potential ordinary shares into ordinary shares. Diluting events are excluded from the calculation when the average market price of ordinary shares is lower than the exercise price.

Adjusted Earnings per share on loss for the period

The Group presents adjusted earnings per share which is calculated by taking adjusted (loss)/profit before taxation and adding the tax credit in order to allow shareholders to understand better the elements of financial performance in the year, so as to facilitate comparison with prior periods and to assess better trends in financial performance.

	6 months to 30 Sept 2019	6 months to 30 Sept 2018
	£	£
Adjusted loss before taxation	(346,941)	(506,702)
Tax credit/(charge)	44,326	(102,324)
Adjusted loss attributable to equity holders of the Group	(302,615)	(609,026)

7. INTANGIBLES

Licences/ Supply Technology Customer Development Goodwill software arrangements assets relationships costs Total £ £ £ £ £ £ £ Cost At 1 April 2018 3,349,878 1,622,786 - 1,974,994 100,003 9,186,215 16,233,876 Additions internally generated - - - - - 1,092,267 1,092,267 Disposals (332,986) - - - - - (332,986) Currency translation 17,608 14,788 6,946 2,286 14,904 7,133 63,665 At 30 September 2018 3,034,500 1,637,574 6,946 1,977,280 114,907 10,285,615 17,056,822 Additions - 13,651 - - - - 13,651 Additions internally generated - - - - - 1,357,734 1,357,734 Currency translation (17,608) (14,563) (6,946) (2,286) (14,904) (7,133) (63,440) At 31 March 2019 3,016,892 1,636,662 - 1,974,994 100,003 11,636,216 18,364,767 Additions - - - - - - - Additions internally generated - - - - - 1,019,614 1,019,614 Disposals - (3,672) - - - - (3,672) Currency translation - 1,065 - - - - 1,065 At 30 September 2019 3,016,892 1,634,055 - 1,974,994 100,003 12,655,830 19,381,774 Accumulated amortisation At 1 April 2018 - 59,325 - 1,045,100 100,003 - 1,204,428 Amortisation charge in the year - 8,513 - 49,374 24,538 7,622 90,047 Currency translation - 2,111 6,946 2,182 11,130 (481) 21,888 At 30 September 2018 - 69,949 6,946 1,096,656 135,671 7,141 1,316,363 Amortisation charge in the year - 8,751 - 49,374 179 (7,622) 50,682 Currency translation - (2,077) (6,946) (2,182) (35,847) 481 (46,571) At 31 March 2019 - 76,623 - 1,143,848 100,003 - 1,320,474 Amortisation charge in the year - 8,265 - 49,374 - 249,103 306,742 Currency translation - 292 - - - - 292 At 30 September 2019 - 85,180 - 1,193,222 100,003 249,103 1,627,508 Net book value 30-Sep-19 3,016,892 1,548,875 - 781,772 - 12,406,727 17,754,266 31-Mar-19 3,016,892 1,560,039 - 831,146 - 11,636,216 17,044,293 30-Sep-18 3,034,500 1,567,625 - 880,624 (20,764) 10,278,474 15,740,459

8. FIXED ASSETS

	Right of use	Leasehold	Plant and
	use assets	improvements	machinery	Total
	£	£	£	£
Cost
At 1 April 2018	-	838,771	3,610,761	4,449,532
Additions	-	101,013	130,248	231,261
Disposals	-	(20,450)	(107,594)	(128,044)
Currency translation	-	-	(6,522)	(6,522)
At 30 September 2018	-	919,334	3,626,893	4,546,227
Additions	-	19,204	89,352	108,556
Disposals	-	-	-	-
Currency translation	-	-	-	-
At 31 March 2019	-	938,538	3,716,245	4,654,783
Additions	1,933,784	30,780	25,803	1,990,367
Disposals	-	-	-	-
Currency translation	-	-	148	148
At 30 September 2019	1,933,784	969,318	3,742,196	6,645,298
Accumulated depreciation
At 1 April 2018	-	357,528	2,379,071	2,736,599
Charge in the year	-	87,776	159,816	247,592
Disposals	-	(5,059)	(72,602)	(77,661)
Currency translation	-	-	(27,388)	(27,388)
At 30 September 2018	-	440,245	2,438,897	2,879,142
Charge in the period	-	88,931	104,931	193,862
Disposals	-	-	-	-
Currency translation	-	-	12,198	12,198
At 31 March 2019	-	529,176	2,556,026	3,085,202
Charge in the period	108,819	53,769	112,556	275,144
Currency translation	-	-	-	-
At 30 September 2019	108,819	582,945	2,668,582	3,360,346
Net book value
30-Sep-19	1,824,965	386,373	1,073,614	3,284,952
31-Mar-19	-	409,362	1,160,219	1,569,581
30-Sep-18	-	479,089	1,187,996	1,667,085

 

END

 

 

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