Interim Management Statement

RNS Number : 2484R

IP Group PLC

28 April 2009

 



FOR RELEASE ON

28 APRIL 2009

('IP Group' or 'the Group' or 'the Company')

IP Group: Interim Management Statement

IP Group plc (LSE: IPO), the UK's leading university intellectual property commercialisation company, today issues its Interim Management Statement in accordance with FSA Disclosure and Transparency Rule 4.3. 

This statement provides an update on the Group's progress since 31 December 2008 to date.

Alan Aubrey, Chief Executive of IP Group, said: 

'The Group continues to progress towards its long term objectives of creating value from the UK's world-class university research base. Prudent cash management continues to be of particular importance during these times of economic stress and, as anticipated, our level of investment has decreased in comparison to the same period in 2008. However the Group continues to invest in compelling opportunities which represent attractive investments on a risk/reward basis. We are pleased with the progress that many of our portfolio businesses continue to make towards technical goals and achieving commercial traction with industry partners.'

Portfolio update

During the period from 1 January 2009 to 27 April 2009, the Group invested a total of £1.2m into 10 portfolio companies. During the equivalent period in 2008, the Group invested £3.0m into 15 companies. The Group has not made any realisations during the period.

As described in the 2008 Annual Report and Accounts, the Group's investments in quoted portfolio companies have experienced some reduction in fair value since 31 December 2008. At 27 April 2009, the Group's portfolio of investments was valued at £93.7m compared to £98.4m at 31 December 2008, representing a net decline in fair value for the year to date, excluding investment, of £5.9m (6.0%).

The 14 companies in the Group's portfolio which are quoted on either AIM or PLUS Markets recorded a net fair value loss of £7.3m (19.2%) during the period to 27 April 2009. This was offset to some degree by the 62 private companies in the portfolio, which saw a net fair value gain of £1.4m (2.2%) during this same period.

Even against a backdrop of continued global economic uncertainty, many of the Group's portfolio businesses have continued to make strong progress towards commercial and technical milestones, including the following examples: 

• Oxford Nanopore Technologies Limited ('Oxford Nanopore'), a spin-out company from the University of Oxford that is developing a new super-fast, digital DNA sequencing system, announced in January that it had entered into a worldwide strategic alliance with NASDAQ-listed Illumina Inc. ('Illumina') for the development and commercialisation of its proprietary BASETM Technology for DNA sequencing. As part of this strategic alliance, Illumina invested $18m (£12m) and was granted worldwide rights for the commercialisation of BASETM sequencing products.

• Syntopix Group plc from the University of Leeds, which specialises in topical treatments for dermatological diseases, announced that it had signed an exclusive evaluation agreement with a major consumer healthcare company, including an undisclosed upfront payment and further payments should any of the group's compounds be selected for further evaluation.

• Synairgen plc, a therapeutics company from the University of Southampton, announced that preliminary biomarker data from its SG004 Phase I trial in asthmatic volunteers had indicated increased anti-viral activity of interferon beta in the lungs. Professor Stephen Holgate, Synairgen's Co-Founder, commented that this achievement, alongside the progression into the third cohort of the study, greatly increased their confidence of success in Phase II trials which are due to begin in early 2010.

Significant transactions

As described above, on 12 January 2009 Illumina made an initial $18.0m (£11.8m) equity investment into Oxford Nanopore, with an agreement that any further investment would be made at a significantly increased valuation upon Oxford Nanopore reaching an agreed technical milestone. Oxford Nanopore also secured an additional £2.1million in private investment at this time, raising a total of £13.9million. The Group recognised a total fair value gain of £3.2m as a result of this transaction and, following its completion, has a 28.8% holding in the business.

Corporate update

In common with the Group's balance sheet portfolio, investment on the fund management side was significantly reduced, with IP Venture Fund ('IPVF') making only £0.1m of investment during the period to [27] April 2009 (Q1 2008: £1.1m).  IPVF is a £30.9m venture capital fund that is dedicated to follow on investments in IP Group portfolio businesses and which has invested a total of £10.7m into 19 IP Group portfolio companies since its launch in July 2006. 

Balance sheet update

At 27 April 2009, the Group had net cash of £31m, a diversified portfolio valued at £94m and net assets of £167m, representing 67p per share.

For more information, please contact:

IP Group plc

Alan Aubrey, Chief Executive Officer             020 7444 0050

Greg Smith, Group Financial Controller         020 7444 0050

Liz Vaughan-Adams, Communications          020 7444 0062 / 07979 853 802

Financial Dynamics                                   020 7831 3113

Ben Atwell, John Dineen

This statement is intended to give an indication of material transactions and events that have taken place since 31 December 2008 and their impact on the financial position of the Group. These indications reflect the Board's current view, are subject to a number of material risks and uncertainties and could change in the future. Factors which could cause or contribute to such changes include, but are not limited to, the general economic climate and market conditions, as well as specific factors relating to the financial or commercial prospects or performance of individual portfolio companies with the Group's portfolio of investments.

About IP Group

IP Group is an intellectual property (IP) commercialisation company that specialises in commercialising university technology. Founded in 2001, IP Group listed on AIM in October 2003 and moved to the Official List in June 2006. It has made two acquisitions to date - Techtran, a company set up to commercialise university intellectual property under a long term contract with the University of Leeds, in 2005 and Top Technology Ventures, an investment adviser to early stage technology venture capital funds, in 2004.

IP Group has formed long-term partnerships with ten universities - the University of Oxford, King's College London, CNAP/University of York, the University of Leeds, the University of Bristol, the University of Surrey, the University of Southampton, Queen Mary (University of London), the University of Bath and the University of Glasgow.

The Company's portfolio is diverse with exposure to five main sectors - Energy & Renewables, Healthcare & Life Sciences: Non-therapeutics, Healthcare & Life Sciences: Therapeutics, IT & Communications and Chemicals & Materials. To date, eleven portfolio companies have listed on the AIM market of the London Stock Exchange, one on PLUS Markets and there have been two trade sales. 

 

END

 

 

IMSIRMRTMMMTBBL