Interim Management Statement

RNS Number : 3999R

IP Group PLC

03 November 2011

 



 

FOR RELEASE ON

3 NOVEMBER 2011

("IP Group" or "the Group" or "the Company")

IP Group: Interim Management Statement

IP Group plc (LSE: IPO), the developer of intellectual property based businesses, 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 its half year on 30 June 2011.

Alan Aubrey, Chief Executive of IP Group, said:

"Against a backdrop of recent financial market volatility, I am pleased to report that the overall value of the Group's portfolio has remained stable since 30 June 2011. We have further strengthened our Board during the period and a number of our portfolio companies have announced further significant commercial developments. The Group's financial position remains strong, with cash resources of £67m and no borrowings, and we continue to increase our rate of capital deployment into our most promising technology companies."

Portfolio update

At 31 October 2011, the Group's portfolio of investments remained stable at £115.1m compared to £115.3m at 30 June 2011. During the period from 1 July 2011 to 31 October 2011, the Group deployed £2.4m across 15 portfolio companies (Q3 2010: £3.5m; 17 companies). Cash realised from the portfolio during the period totalled £3.5m, including the previously announced sale of the Group's holding in Amantys Limited, compared to £1.9m for the equivalent period in 2010. The net profit on these disposals was £2.2m, which was partially offset by a net unrealised fair value reduction of £1.3m on the Group's remaining portfolio.

The Group has now invested a total of £7.9m year to date, which exceeds the £6.9m invested during the whole of 2010, and has identified a number of further opportunities which are currently expected to complete during the next three to six months.

Significant developments in the Group's portfolio companies since 30 June 2011 have included:

·      Photopharmica Limited ("Photopharmica"), a spin-out from the University of Leeds that is developing a photodynamic therapy platform, announced positive results from its Phase 2b randomised, placebo controlled, trial of antimicrobial photodynamic therapy using PPA 904 in the treatment of chronic leg ulcers. The trial successfully met its primary endpoint with statistical significance (p < 0.0001). Antimicrobial photodynamic therapy using PPA 904 was shown to produce a substantial and significant reduction in bacterial load in chronic leg ulcers. Photopharmica is now planning its next steps for continuing the development of the programme.

·      Proximagen Group plc ("Proximagen"), the King's College, London spin-out, announced the signing of a strategic partnership agreement with H. Lundbeck A/S ("Lundbeck"), the international pharmaceutical company and a world leader in treating central nervous system ("CNS") disorders, on 29 September 2011. The agreement is designed to formalise a partnership between the two companies, a partnership in which Lundbeck and Proximagen will jointly apply their expertise in CNS drug development towards achieving their collective strategic and growth objectives. Under the terms of the agreement, Proximagen issued new shares to Lundbeck at a price of 180p per new share, a premium of 36% over the average daily closing price of Proximagen's shares over the previous six months. Following the issue of these new shares, IP Group's beneficial holding in Proximagen is 7.6%.

·      Green Chemicals plc, the producer of "cleaner, greener, safer" chemicals, announced commercial developments in two application areas of its technology. In the field of fire retardants for textiles, the company signed an exclusive, worldwide licence agreement with Clariant International Limited, a global leader in the field of speciality chemicals, which provides for royalties on sales. In the hair colouration field, Green Chemicals plc announced that its exclusive licensee, Urban Retreats Limited ("UR"), the operator of high-end hair treatment centres and beauty spas, had commenced live trials of its permanent hair colorant and colour removal systems had commenced at UR's spa in Harrods of Knightsbridge.

·      Avacta Group plc ("Avacta"), a specialist provider of analytical and diagnostic technologies and services to the pharmaceutical and animal healthcare sectors, announced positive full year results to 31 July 2011, showing revenue growth of 42% to £2.5m. The results followed announcement by the company in October that it had extended its commercial partnership with Pall Corporation to include global analytical services collaboration and Optim distribution in South East Asia.

Balance sheet update

At 31 October 2011, the Group had net cash of £67m, a diversified portfolio valued at £115m and net assets of £221m, representing 60p per share. Excluding intangible assets and the Oxford Equity Rights asset, the Group's net assets were £187m or 51p per share.

Board changes

The Group has announced three changes to the Board since 30 June 2011. In August, Jonathan Brooks, the former Chief Financial Officer of ARM Holdings plc, joined the Board as Non-executive Director and as Chairman of the Group's audit committee. In October, Mike Humphrey, Group Chief Executive of Croda International plc ("Croda"), was appointed to the Board as Non-executive Director and Charles Winward, MD of Top Technology Ventures Limited, IP Group's venture capital fund management subsidiary, was promoted to the Board as an Executive Director.

For more information, please contact:

IP Group plc

Alan Aubrey, Chief Executive Officer                    [phone]

Greg Smith, Chief Financial Officer                      [phone]

Liz Vaughan-Adams, Communications                 [phone] / [phone]

FTI Consulting                                                 [phone]

Ben Atwell, John Dineen

This statement is intended to give an indication of material transactions and events that have taken place since 30 June 2011 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.

Notes for editors

About IP Group

IP Group is a leading UK intellectual property ("IP") commercialisation company, developing technology innovations primarily from its research intensive partner universities. The Group offers more than traditional venture capital, providing its companies with access to business building expertise, networks, recruitment and business support.

The Company's portfolio comprises holdings in over 60 companies including Oxford Nanopore Technologies, the DNA sequencing development company, Revolymer, best known for its removable chewing gum and Xeros, which has received many accolades for its revolutionary clothes washing techniques with a much reduced requirement for water.

The portfolio includes early stage to mature businesses and has exposure to five main sectors - Energy & Renewables, Medical Equipment & Supplies, Pharma & Biotech, IT & Communications and Chemicals & Materials. To date, thirteen of the portfolio companies IP Group has backed have listed on the AIM market of the London Stock Exchange and one on PLUS Markets.

Founded in 2001, IP Group listed on AIM in October 2003 and moved to the Official List in June 2006. The Group now has long-term partnerships with twelve core universities including those under its commercialisation agreement with Fusion IP plc.

For more information, please visit our website at www.ipgroupplc.com.

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