Preliminary Final Results

RNS Number : 5910Y

Venn Life Sciences Holdings PLC

10 May 2019

 

10 May 2019

Venn Life Sciences Holdings Plc

("Venn", "Venn Life Sciences" or the "Company")

Preliminary Final Results for the year ended 31 December 2018

Venn Life Sciences (AIM: VENN), an Integrated Drug Development Partner offering a combination of drug development expertise and clinical trial design and management to pharmaceutical, biotechnology and medical device organisations, announces its unaudited results for the year ended 31 December 2018.

Financial Highlights

·     Total revenue was €14.6m (2017: €17.8m)

·      EBITDA Loss (before exceptional items) of €1.06m  (2017: profit €0.96m)

·      Write down of €2.2m on the impairment of Intangible Assets  

·     Loss for the year after tax of €4.5m (2017: €1.5m) after a charge of €2.6m (2017: €1.7m) being investment write-down on Integumen PLC (€0.4m) and impairment of intangible assets (€2.2m)

·    Arrangement of €1.0 milion loan note in December to support working capital and collaboration with Open Orphan

·     Cash and cash equivalents of €1.1m as at 31 December 2018 (2017: €1.2m)

Operational Highlights

·     Improved revenue mix with lower key client dependency

·     Maintanence of billable resource base despite project deferrals, enabling quicker business recovery

·     Strategic collaboration with Open Orphan and focus on Rare and Orphan indications

·     Successful management of ground breaking, life saving technology development program providing invaluable reference point for future business generation

Outlook

Post the year end the Company has experienced a continuation of prior year trends with low utilisation resulting in revenue and EBITDA being behind management forecasts for the year to date. Based on the current proposals book the Directors expect there should be an increase in revenues and profitability in the coming months. However, the Company continues to require careful management of available cash resources and the Directors expect additional financial resource to be required in order for the Company to successfully execute its growth strategy.

Commenting on the Group's results, Tony Richardson, CEO of Venn, said:

"While the confidential nature of our business prevents us from fully disclosing client and technology details, I am pleased to communicate that we have played a pivotal role in the development of a successful drug for the treatment of a rare medical condition. This is the culmination of three years work and provides a critical proof point regarding Venn's drug development capabilities. We have significantly advanced our credentials as a drug development partner and begin this year with greater credibility in the eyes of current and prospective clients. We are committed to further service and geographical expansion of our business in 2019 and further to our collaboration announcement in December 2018 have made significant strides in developing our platform offering for Rare and Orphan drug developers"

Enquiries:

Venn Life Sciences Holdings Plc Tel: [phone]
Cathal Friel / Tony Richardson

Arden Partners (Nominated Adviser and Joint Broker) Tel: [phone]
John Llewellyn-Lloyd / Ruari McGirr / Benjamin Cryer

Davy (Euronext Growth Adviser and Joint Broker) Tel: [phone]
Anthony Farrell (Corporate Finance) / Ivan Murphy

Camarco (Financial PR) Tel: [phone]
Tom Huddart / Billy Clegg / Daniel Sherwen

 

Consolidated Statement of Comprehensive Income

For the year ended 31 December 2018

		2018		2017	2016
		€'000		€'000	€'000
Continuing operations
Revenue		14,185		17,405	17,909
Direct Project and Administrative Costs		(16,552)		(17,763)	(18,805)
Other operating income		371		410	335
Operating (loss)/Profit		(1,996)		52	(561)
Depreciation		(95)		(99)	(133)
Amortisation		(840)		(792)	(689)
Exceptional items		(-)		(25)	(125)
EBITDA before exceptional items		(1,061)		968	386
Finance income		10		-	12
Finance costs		-		-	-
Share of loss of investments accounted for using the equity method		(-)		(874)
Impairment of fixed asset investments		(421)		(843)	(364)
Impairment of Intangible Assets		(2,232)		-
(Loss) before income tax		(4,639)		(1,665)	(913)
Income tax credit		129		127	169
(Loss) for the year from continuing operations		(4,510)		(1,538)	(744)
Discontinued operations
Profit for the year from discontinued operations		-		-	1,295
(Loss) for the year		(4,510)		(1,538)	551
Loss for the year is attributable to:
Owners of the parent		(4,510)		(1,538)	532
Non-controlling interests		-		-	19
		(4,510)		(1,538)	551
Other comprehensive income
Currency translation differences		85		(139)	(36)
Total comprehensive (loss) for the year		(4,425)		(1,677)	515
Total comprehensive (loss) for the year is attributable to:
Owners of the parent		(4,425)		(1,677)	496
Non-controlling interests		-		-	19
		(4,425)		(1,677)	515
Total comprehensive (loss) for the year attributable to owners of the parent arises from:
Continuing operations		(4,425)		(1,677)	(799)
Discontinued operations		-		-	1,295
		(4,425)		(1,677)	496
Earnings per share from continuing and discontinued operations attributable to owners of the parent during the year
Basic (loss) per ordinary share
From continuing operations		(6.77c)		(2.78c)	(1.26c)
From discontinued operations		-		-	2.14c
From (loss) for the year		(6.77c)		(2.78c)	0.88c
Diluted (loss) per ordinary share
From continuing operations		(6.12c)		(2.56c)	(1.14)
From discontinued operations		-		-	1.93c
From (loss) for the year		(6.12c)		(2.56c)	0.79c

Consolidated and Company's Statement of Financial Position

As at 31 December 2018

				Group	Group
				2018	2017 Restated
				€'000	€'000
Assets
Non-current assets
Property, plant and equipment				263	312
Intangible assets				996	4,034
Investments in subsidiaries				-	-
Assets held for sale				259	680
Investments				31	31
Total non-current assets				1,549	5,057
Current assets
Trade and other receivables				6,517	5,514
Income tax recoverable				57	107
Cash and cash equivalents				1,098	1,175
Total current assets				7,672	6,796
Total assets				9,221	11,853
Equity attributable to owners
Share capital				168	155
Share premium account				14,701	14,026
Group re-organisation reserve				(541)	(541)
Merger relief reserve				-	-
Reverse acquisition reserve				45	45
Other Reserve				(34)	-
Foreign currency reserves				(41)	(126)
Share option reserve				-	-
Retained earnings				(9,674)	(5,164)
				4,624	8,395
Non-controlling interest				-	-
Total equity				4,624	8,395
Liabilities
Non-current liabilities
Borrowings				-	-
Total non-current liabilities				-	-
Current liabilities
Trade and other payables				3,786	2,999
Deferred taxation				342	434
Borrowings				469	25
Total current liabilities				4,597	3,458
Total liabilities				4,597	3,458
Total equity and liabilities				9,221	11,853

Consolidated and Company's Statement of Cash Flows

For the year ended 31 December 2018

				Group	Group
				2018	2017
	Notes			€'000	€'000
Cash Flow from operating activities
Continuing operations
Cash used in operations				(1,105)	(1,285)
Income tax received/(paid)				(-)	(64)
Net cash used in operating activities				(1,105)	(1,346)
Cash flow from investing activities
Investment in associate				(35)	(465)
Purchase of intellectual property				(33)	(327)
Purchase of property, plant and equipment				(46)	(193)
Refund of Escrow				-	-
Interest received				10	-
Net cash used in investing activities				(104)	(985)
Cash flow from financing activities
Proceeds from issuance of ordinary shares				687	-
Proceeds from invoice discounting				469
Repayments on borrowings				(25)	(35)
Net cash generated by financing activities				1,132	(35)
Net increase/ (decrease) in cash and cash equivalents				(77)	(2,366)
Cash and cash equivalents at beginning of year				1,175	3,541
Exchange losses on cash and cash equivalents				-	-
Cash and cash equivalents at end of year				1,098	1,175

Consolidated Statement of Changes in Shareholders' Equity

	Share capital		Share premium		Re-organisation  & Reverse acquisition & other reserve		Share Option reserve		Foreign currency reserve		Retained earnings		Total		Non-controlling interests		Total
	€'000		€'000		€'000		€'000		€'000		€'000		€'000		€'000		€'000
At 1 January 2017	155		14,026		(496)		28		13		(3,294)		10,432		-		10,432
Changes in equity for the year ended 31 December 2017
(Loss) for the year	-		-		-		-		-		(1,538)		(1,538)		-		(1,538)
Currency translation differences	-		-		-		-		(139)		-		(139)		-		(139)
Total comprehensive (loss) for the year	-		-		-		-		(139)		(1,538)		(1,677)		(-)		(1,677)
Transactions with the owners
Shares issued	-		-		-		-		-		-		-		-		-
Share option provision reversed	-		-		-		(28)		-		28		-		-		-
Total contributions by and distributions to owners	-		-		-		(28)		-		28		-		-		-
At 31 December 2017 as previously stated	155		14,026		(496)		-		(126)		(4,804)		8,755		(-)		8,755
Prior year adjustment	-		-		-		-		-		(360)		(360)		(-)		(360)
At 31 December 2017 after prior year adjustment	155		14,026		(496)		-		(126)		(5,164)		8,395		(-)		8,395
Changes in equity for the year ended 31 December 2018
(Loss) for the year	-		-		-		-		-		(4,510)		(4,510)		-		(4,510)
Currency translation differences	-		-		-		-		85		-		85		-		85
Total comprehensive profit /(loss) for the year	-		-		-		-		85		(4,510)		(4,425)		-		(4,425)
Transactions with the owners
Shares issued	13		675		-		-		-		-		688		-		688
Purchase of minority Interest	-		-		(34)		-		-		-		(34)		-		(34)
Total contributions by and distributions to owners	13		675		(34)		-		-		-		654		-		654
At 31 December 2018	168		14,701		(530)		-		(41)		(9,674)		4,624		-		4,624

1. General information

Venn Life Sciences Holdings Plc is a company incorporated in England and Wales. The Company is a public limited company listed on the AIM market of the London Stock Exchange. On 18 January 2016, the company also listed on the ESM market of the Irish Stock Exchange. The address of the registered office is 1 Berkeley Street, London, W1J 8DJ.

The principal activity of the Group is that of a Clinical Research Organisation providing a suite of consulting and clinical trial services to pharmaceutical, biotechnology and medical device organisations. The Group has a presence in the UK, Ireland, France, Netherlands, Germany and Singapore.

The financial statements are presented in Euros, the currency of the primary economic environment in which the Group's trading companies operate. The Group comprises Venn Life Sciences Holdings Plc and its subsidiary companies.

The registered number of the Company is 07514939.

2. Earnings per share

(a) Basic                                              

Basic earnings per share is calculated by dividing the loss attributable to equity holders of the Company by the weighted average number of ordinary shares in issue during the period.

									Draft		Audited
									Year ended		Year ended
									31 December		31 December
									2018 €'000		2017 €'000
Loss from continuing operations attributable to equity holders of the Company (€'000)									(4,425)		(1,677)
Total									(4,425)		(1,677)
Weighted average number of Ordinary Shares in issue									65,293,943		60,284,263

b) Diluted

Diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares outstanding to assume conversion of all dilutive potential ordinary shares.

Weighted average number of shares used as the denominator :

		Draft			Audited
		Year ended			Year ended
		31 December 2018			31 December 2017
Weighted average number of Ordinary Shares in issue		65,293,943			60,284,263
Adjustments for calculation of diluted earnings per share:
Options		6,544,167			4,985,288
Warrants		418,749			166,666
Total		72,256,859			65,436,217

3. Prior Year adjustment

The adjustment of €360,000 to opening retained earnings relates to year end 2016 and earlier periods and is made up of the following two items:

1.    As a result of the adoption of IFRS15 a full review of accrued income on all active and completed contracts was undertaken in 2018 and the result was a €226,000 correction was required to the year end 2016 retained earnings balance carried forward.

2.    A consolidation adjustment was made in 2016 relating to amount of €134,000 held in an Escrow account. This consolidation adjustment should have been reversed in 2017 when the escrow account was settled but was over-looked. Consequently, the 2016 retained earnings carried forward are now being corrected.

 

END

 

 

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