Half Yearly Report

RNS Number : 2116X

OptiBiotix Health PLC

27 August 2015

 

27 August 2015

OptiBiotix Health Plc

("OptiBiotix" or the "Company")

Half Yearly Report

OptiBiotix Health plc (AIM: OPTI), a Life Sciences business developing compounds to tackle obesity, high cholesterol and diabetes, announces its results for the six months ended 31 May 2015.

OptiBiotix continues to make progress on its strategy of developing compounds which modify the human microbiome and commercialising these through partnering with food, health, and wellbeing companies.

Highlights

•    The appointment of Jim Laird as Commercial Director to the Board to increase commercial capacity and capability

•    The completion of preclinical studies and ethics approval received to enable human clinical studies to begin for the Company's cholesterol lowering product

•    Expansion of the OptiBiotic® platform to a wider range of microbial species broadening the number of product and partner opportunities

•    The filing of four new patents

•    Creating a joint venture with Nizo Food Research to develop, manufacture and distribute weight management yoghurts to global markets

Post-period end highlights

•    Announcement of an option agreement with a multinational consumer goods company for the cholesterol lowering product

·    Strategic alliance with Venture Life

·    Agreement with Spanish National Research Council

Stephen O'Hara, CEO of OptiBiotix commented: "I am delighted with the progress OptiBiotix has made since joining AIM in August 2014. In a short space of time we have moved one of our development programmes into clinical studies, progressed our sugar programme designed to create low calorie, sweet oligosaccharides to reduce chronic lifestyle disease such as heart disease, obesity and diabetes, built on our IP portfolio, and reached agreements with a number of commercial partners. During the period, we strengthened the Board with the appointment of Jim Laird, who has brought industry specific commercial and corporate expertise to the Company. I would like to thank our investors for their support since we joined AIM, and look forward to an exciting and rewarding rest of 2015."

 For further information:

OptiBiotix Health plc	www.optibiotix.com
Stephen O'Hara, Chief Executive	Contact via Walbrook below
Cairn Financial Advisers LLP (Nomad)	Tel: [phone]
Liam Murray / Avi Robinson
Hybridan LLP (Joint Broker) Claire Louise Noyce	Tel: [phone]
Peterhouse Corporate Finance Ltd (Joint Broker)	Tel: [phone]
Lucy Williams / Duncan Vasey
Walbrook PR Ltd	Tel: [phone] or [e-mail]
Anna Dunphy	Mob: [phone]
Mike Wort	Mob: [phone]

About OptiBiotix Health PLC - www.optibiotix.com 

OptiBiotix was formed in March 2012 to develop compounds which modify the human microbiome - the collective genome of the microbes in the body - to prevent and manage human disease. The aim of OptiBiotix is to discover and develop microbial strains, compounds and formulations, which modulate the human microbiome and can be used as food ingredients and supplements or active compounds for the prevention and management of human metabolic diseases, examples of which include obesity, cholesterol and lipid distribution and diabetes. 

OptiBiotix has established a pipeline of microbiome modulators that can impact on lipid and cholesterol management, energy harvest and appetite suppression. The development pipeline is fuelled by its proprietary OptiScreen® and OptiBiotic® platform technologies designed to identify metabolic pathways and compounds that impact on human physiology and bring potential health benefits. These platforms are applicable across a wider range of other human diseases.

Chairman's and CEO's Report

The last six months has seen increased industry, media, and investor interest in the microbiome with a number of news items on the radio, television and national newspapers.  This has been fuelled by the growing number of research publications showing the potential of the human microbiome to prevent and treat a wide range of diseases.  As awareness of the health potential of the human microbiome grows, we anticipate further media, industry and investor interest in companies in this field. 

OptiBiotix has a number of exciting development programmes designed to create commercial products with an established scientific evidence base and proof of human efficacy. 

Our cholesterol product is in human studies designed to establish product safety, consumer compliance and the extent of its cholesterol lowering potential in this group of volunteers is now complete.  We anticipate reporting on this in September 2015 as originally planned.

We have de-risked a number of the technical challenges in our sugar development programme and identified the potential to produce novel sugars in a wider range of species than initially anticipated.  This has led to a number of new patent filings which adds to our 'toolbox' of approaches to manage weight gain.  We anticipate further additions to this 'toolbox' in the coming year.  During the development process we have improved the ability of the OptiBiotic® discovery platform to predict the likelihood of microbial strains producing new sugars with novel structures.  This creates the ability to screen a greater range of species and strains with the same resources. The Board believes these advances broaden the range of application, product and partnering opportunities, and make a significant contribution to building shareholder value and a sustainable business.

As our development programmes progress towards commercialisation, we anticipate increasing partner interest.  We will work with our advisors to enhance awareness of OptiBiotix and share news with prospective and existing investors.  

In the last six months we have added to our existing IP portfolio and anticipate filing further patents and registering additional microbial strains where we feel there is commercial value. We will continue to explore opportunities to in-license or acquire new technologies or IP to support our continued growth. 

The Company will continue to leverage its existing relationships and develop new relationships with research, development, and industry partners to support the commercialisation of our technology and products.  This activity will be greatly enhanced by the commercial and corporate expertise of Jim Laird, who joined us in March 2015 from Premier Foods. In the last six months we have made good commercial progress securing a joint venture agreement with Nizo for the weight management product and an option agreement with a global corporate partner for our cholesterol product.  Discussions with partners suggest there is growing interest in the microbiome and we anticipate further announcements in the coming year.

The Board believes OptiBiotix is at the leading edge of an immature but emerging market forecast to become one of the world's fastest growth areas.  OptiBiotix has made good progress in the last six months and now looks to build on this solid foundation to build a microbiome business with significant value for shareholders.

On behalf of everyone at OptiBiotix Health plc we thank you for your support and look forward to an exciting future. At OptiBiotix we believe that better science equals better health and with your continued support we will strive to ensure this becomes a reality.

David Evans Chairman 27 August 2015

Stephen OHara Chief Executive Officer 27 August 2015

Results

OptiBiotix's results for the six months ended 31 May 2015 are set out in the Consolidated Statement of Comprehensive Income. Administrative expenses were £514,431 which reflects the costs of operating a public company and includes the non-cash accounting adjustment of £127,728 share option expense charge. Cashflow remains tightly controlled with a focus on building shareholder value through investment in R&D and IP.  The Group's cash position is £2.47m which is sufficient to fund its existing research and development programmes.

Optibiotix Health Plc

Consolidated Statement of Comprehensive Income

For the period to 31 May 2015

               

		6 months to 31 May 2015 Unaudited	6 months to 31 May 2014 Unaudited	Year to 30 November 2014 Audited
Continuing operations		£	£	£
Administrative expenses		(514,431)	(57,643)	(489,015)
		───────	───────	───────
Operating loss		(514,431)	(57,643)	(489,015)
Non-Operating Items
Admission expenses		-	-	(365,038)
		───────	───────	───────
		(514,431)	(57,643)	(854,053)
Finance income / (costs)		7	-	93
		───────	───────	───────
Loss before Income tax		(514,424)	(57,643)	(853,960)
Income tax		-	-	43,254
		───────	───────	───────
Loss for the period		(514,424)	(57,643)	(810,706)
		───────	───────	───────
Total comprehensive income for the period		(514,424)	(57,643)	(810,706)
		═══════	═══════	═══════
Total comprehensive income attributable to the owners of the company		(514,424)	(57,643)	(810,706)
		═══════	═══════	═══════
Loss per share	4
Basic & Diluted loss per share - pence		0.708p	1.144p	3.03p
		═══════	═══════	═══════

Optibiotix Health Plc

Consolidated Statement of Financial Position

For the period to 31 May 2015

	Notes	As at 31 May 2015 Unaudited	As at 31 May 2014 Unaudited	As at 30 November 2014 Audited
ASSETS		£	£	£
Non-current assets
Intangibles		2,259,369	-	2,259,369
Property, plant & equipment		2,473	-	855
		───────	───────	───────
		2,261,842	-	2,260,224
		───────	───────	───────
CURRENT ASSETS
Trade and other receivables		28,595	10,034	4,651
Current tax asset		94,107	-	43,254
Cash and cash equivalents		2,470,577	105,221	2,870,442
		───────	───────	───────
		2,593,279	115,255	2,918,347
		───────	───────	───────
TOTAL ASSETS		4,855,121	115,255	5,178,571
		═══════	═══════	═══════
EQUITY
Shareholders' Equity
Called up share capital	5	7,100,284	5,742,586	7,078,346
Share premium		3,812,596	1,355,502	3,746,781
Share based payment reserve		218,698	27,200	90,970
Merger relief reserve		1,500,000		1,500,000
Accumulated deficit		(8,281,437)	(7,013,950)	(7,767,013)
		───────	───────	───────
Total Equity		4,350,141	111,338	4,649,084
		───────	───────	───────
LIABILITIES
Current liabilities
Trade and other payables		53,106	3,917	77,613
		───────	───────	───────
		53,106	3,917	77,613
		───────	───────	───────
Non - current liabilities
Deferred tax		451,874	-	451,874
		───────	───────	───────
		451,874	-	451,874
		───────	───────	───────
TOTAL LIABILITITES		504,980	3,917	529,487
		───────	───────	───────
TOTAL EQUITY AND LIABILITIES		4,855,121	115,255	5,178,571
		═══════	═══════	═══════

Optibiotix Health Plc

Consolidated Statement of Changes in Equity

For six month to 31 May 2015

	Called up Share Capital	Share premium	Share-based Payment reserve	Merger Relief Reserve	Accumulated deficit	Total Equity
	£	£	£	£	£	£
Balance at 30 November 2013	5,722,248	1,302,811	27,200	-	(6,956,307)	95,952
Loss for the period	-	-	-	-	(57,643)	(57,643)
Issue  of  ordinary  shares  Less issue costs	20,338	52,691	-	-	-	73,029
	──────	───────	───────	──────	──────	───────
Balance at 31 May 2014	5,742,586	1,355,502	27,200	-	(7,013,950)	111,338
Loss for the period	-	-	-	-	(753,063)	(753,063)
Issue of consideration shares to acquire subsidiary	500,000	-	-	1,500,000	-	2,000,000
Issues of shares	825,229	2,484,009	-	-	-	3,309,238
Share issue expenses	-	(124,323)	-	-	-	(124,323)
Exercise of warrants	10,531	31,593	-	-	-	42,124
Grant of share options and warrants	-	-	63,770	-	-	63,770
	──────	───────	───────	──────	──────	───────
Balance at 30 November 2014	7,078,346	3,746,781	90,970	1,500,000	(7,767,013)	4,649,084
Loss before period	-	-	-	-	(514,424)	(514,424)
Issue shares during the period	21,938	65,815	-	-	-	87,753
Share based  payment	-	-	127,728	-	-	127,728
	──────	───────	───────	──────	──────	───────
Balance at 31 May 2015	7,100,284	3,812,596	218,698	1,500,000	(8,281,437)	4,350,141

Optibiotix Health Plc

Consolidated Statement of Cash Flows

For the period to 31 May 2015

	Notes	6 months to 31 May 2015 Unaudited	6 months to 31 May 2014 Unaudited	Year to 30 November 2014 Audited
		£	£	£
Reconciliation of loss before income tax to cash outflow from operations
Operating loss		(565,284)	(57,643)	(854,053)
(Increase)/decrease in trade and other receivables		(23,944)	291,233	296,616
Decrease in trade and other payables		(24,507)	(201,548)	(212,913)
Share Option expense		127,728	-	63,770
Depreciation		347	-	244
		──────	──────	──────
Net cash outflow from operations		(485,660)	32,042	(706,336)
Interest paid		-	-	-
Interest received		7	-	93
		──────	──────	──────
Net cash outflow from operating activities		(485,653)	32,042	(706,243)
Cash flows from investing activities
Purchases of property, plant and equipment		(1,965)	-	(1,099)
Net cash from acquisition of subsidiary		-	-	251,834
		──────	──────	──────
Net cash (outflow)/inflow from investing activities		(1,965)	-	250,735
		──────	──────	──────
Cash flows from financing activities
Share issues		87,753	73,029	3,300,068
		──────	──────	──────
Net cash inflow from financing activities		87,753	73,029	3,300,068
		──────	──────	──────
Taxation		-	-	25,732
Increase/(decrease) in cash and equivalents		(399,865)	105,071	2,870,292
Cash and cash equivalents at beginning of year		2,870,442	150	150
		──────	──────	──────
Cash and cash equivalents at end of year		2,470,577	105,221	2,870,442
		══════	══════	══════

Optibiotix Health Plc

Notes to the Interim Financial Information

For the period to 31 May 2015

1.    General Information

 Optibiotix Health Plc is a company incorporated and domiciled in England and Wales. The company's offices are in York. The company is listed on the AIM market of the London Stock Exchange (ticker: OPTI).

The financial information set out in this interim report does not constitute statutory accounts as defined in Section 434 of the Companies Act 2006.  The group's statutory financial statements for the year ended 30 November 2014, prepared under International Financial Reporting Standards ("IFRS"), have been filed with the Registrar of Companies.  The auditor's report on those financial statements was unqualified and did not contain statements under Sections 498(2) and 498 (3) of the Companies Act 2006.

Copies of the annual statutory accounts and the interim report can be found on the Company's website at http://www.optibiotix.com/.

2.    Basis of preparation and significant accounting policies

This interim report has been prepared using the historical cost convention, on a going concern basis and in accordance with International Financial Reporting Standards ("IFRS") as adopted by the European Union, using accounting policies which are consistent with those set out in the financial statements for the year ended 30 November 2014.

New and amended standards adopted by the group

There are no IFRSs or IFRIC interpretations that are effective for the first time in this financial period that would be expected to have a material impact on the group, except for IFRS 9 Financial Instruments

3.    Segmental Reporting

In the opinion of the directors, the group has one class of business, being that of research and development. The group's primary reporting format is determined by the geographical segment according to the location of its establishments. There is currently only one geographic reporting segment, which is the UK. All costs are derived from the single segment.

4.    Earnings per Share

        Basic earnings per share is calculated by dividing the earnings attributable shareholders by the weighted average number of ordinary shares outstanding during the period.

Reconciliations are set out below:

	6 Months to 31 May 2015 Unaudited	6 Months to 31 May 2014 Unaudited	Year to 30 November  2014 Audited
Basic and diluted EPS
Earnings attributable to ordinary shareholders	(£514,424)	(£57,643)	(£810,706)
Weighted average number of shares	72,684,379	5,040,513	26,751,262
Loss per-share - pence	0.708p	1.144p	3.03p
	═════	═════	═════

        The weighted average number of shares for the six months to 31 May 2014 has been adjusted from 1,008,102,543 to 5,040,513 to reflect the subdivision which occurred during the year to 30 November 2014.

        Basic and diluted earnings per share are the same, since where a loss is incurred the effect of outstanding share options and warrants is considered anti-dilutive and is ignored for the purpose of the loss per share calculation. As at 31 May 2015 there were 10,350,387 outstanding share options and 3,482,650 outstanding share warrants.

5.   Share Capital

        Issued share capital compromises:

		6 months  to 31 May 2015 Unaudited	6 months  to 31 May 2014 Unaudited	Year to 30 November 2014 Audited
		£	£	£
Ordinary shares of 0.01p each 1,098,618,237		-	109,862	-
Ordinary shares of 2p each 73,377,992		1,457,560	-	1,445,622
Deferred shares of 19p each 26,001,739		4,940,330	4,940,330	4,940,330
Deferred shares of .90p each 63,373,961		570,366	570,366	571,366
Deferred shares of 0.09p each 135,587,293		122,028	122,028	122,028
		───────	───────	───────
		7,100,284	5,742,586	7,078,346
		═══════	═══════	═══════

On 7 January 2015, 19 January 2015, 19 March 2015, 20 April 2015 and 21 May 2015 the company issued and allotted 125,000, 24,375, 441,807, 479,787 and 25,941 ordinary shares of £0.02 each respectively, exercised at a price of £0.08 per share in the capital of the company following the exercise of warrants.

6.    Share options

On 30 March 2015, the Company granted options on 1,717,544 ordinary shares to two directors and one employee. The options vest upon certain performance criteria being met and lapse on the tenth anniversary of the agreements.

The fair value of the share options issued in the current period is £0.12 and was derived using the Black Scholes model. The following assumptions were used in the calculation:

Share price at grant date	27.99p
Risk-free rate	0.25%
Volatility	35%
Expected life	10 years

Expected volatility is based on a conservative estimate for an AIM listed entity. The expected life used in the model has been adjusted, based on management's best estimate, for the effects of non-transferability, exercise restrictions and behavioural considerations.

A charge of £127,728 has been recognised for the share based payments over the vesting period.

7.   Events subsequent to 31 May 2015

On 5 June 2015 and 17 June 2015, the company issued and allotted 191,625 and 7,293 ordinary shares of £0.02 each respectively, exercised at a price of £0.08 per share in the capital of the company following the exercise of warrants.

 

END

 

 

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