Half-year Report

RNS Number : 1127X

Provexis PLC

31 December 2021

 

Prior to publication, the information contained within this announcement was deemed by the Company to constitute inside information as stipulated under the UK Market Abuse Regulation. With the publication of this announcement, this information is now considered to be in the public domain.

31 December 2021

Provexis plc

UNAUDITED INTERIM RESULTS FOR SIX MONTHS TO 30 SEPTEMBER 2021

Provexis plc ("Provexis" or the "Company"), the business that develops, licenses and sells the proprietary, scientifically-proven Fruitflow® heart-health functional food ingredient, announces its unaudited interim results for the six months ended 30 September 2021.

Highlights

· Long term strategic co-operation framework agreement for Fruitflow secured with By-Health in November 2021, with exclusive supply and distribution rights for By-Health to commercialise Fruitflow in China and Australia.

·Planned launch by By-Health, a circa £5bn listed Chinese dietary supplement business, of a number of Fruitflow based products in the Chinese market is progressing well. Potential sales volumes remain at a significant multiple of existing Fruitflow sales.

·By-Health continues to work on an extensive regulatory submission to the Chinese State Administration for Market Regulation (SAMR) for Fruitflow, seeking to establish a new permitted health function claim for foods such as Fruitflow that can demonstrate an anti-platelet effect, addressing the aberrant blood clots which can lead to heart attacks and strokes.

·By-Health has made a significant investment in eight separate studies in China, at its sole expense, in support of the Fruitflow based products which it plans to launch in China. The five studies which have been completed by By-Health showed excellent results in use for Fruitflow, and provide strong evidence for By-Health in its regulatory submissions to the SAMR for Fruitflow.

·  The Company and its commercial partner DSM remain in constructive negotiations, working towards a new agreement for Fruitflow for the period after 31 December 2022.

·Fruitflow has been recognised in a further five published scientific journals over the past eighteen months, two of them in the context of COVID-19; the Frontiers in Nutrition journal stated that nutraceuticals such as Fruitflow may serve as a 'safe antiplatelet prophylactic treatment for those at high risk of COVID-19'.

·Total revenue for the period £211k, 11% behind the prior six month period (2020: £237k), primarily due to short term lockdowns and other COVID-19 disruptions in some of the growing markets for Fruitflow in the Asia Pacific region.

·The Company's Fruitflow+ Omega-3 direct selling business accounted for £76k of total revenue, a 34% increase in this business relative to the prior six month period (2020: £57k). A new production run of Fruitflow+ Omega-3 capsules was completed in July 2021.

· Loss from operations reduced to £145k, 29% lower than the prior six month period (2020: £202k).

·Cash £982k at 30 September 2021 (30 September 2020: £156k). The Company raised £1.0m from a placing in December 2020.

 

Provexis Chairman Dawson Buck and CEO Ian Ford commented:

'We were delighted to announce a supply and distribution agreement for Fruitflow with By-Health in November 2021, which follows our extensive work with By-Health over the last five years. The agreement will take full effect from 1 January 2023.

By-Health currently expects to be in a position to complete the last of its eight studies in 2022, and it will file its regulatory submission to the SAMR for Fruitflow at the appropriate time, seeking to obtain a new permitted health function claim for foods such as Fruitflow that can demonstrate an anti-platelet effect. If By-Health is successful in obtaining a new permitted health function claim, it is currently expected that this would result in some significant orders for Fruitflow, potentially at a multiple of current total sales values.

Fruitflow is well placed to play an important role in the Chinese cardiovascular health market under the permitted health function claim legislation, and we look forward to working closely with By-Health seeking to maximise the commercial success of this agreement for the benefit of both companies.

The Company and DSM have had a strong long-term relationship, with the shared interest of both companies being to maximise the commercial returns that can be achieved from Fruitflow. The total projected annual sales value of the prospective sales pipeline for Fruitflow continues to stand at a substantial multiple of existing annual sales.

The Alliance Agreement with DSM dates back to June 2010, with a contractual term which runs to 31 December 2022. By default from 1 January 2023 the agreement: (i) permits DSM to continue to sell Fruitflow to its existing customers, on the basis that a royalty on Fruitflow sales, fixed at favourable market conditions, will remain payable to the Company; and (ii) permits the Company to sell Fruitflow as an ingredient directly to third parties, outside the existing profit sharing arrangements.

The Company and DSM have started and remain currently engaged in constructive negotiations working towards a new agreement. The commercial terms of the negotiations remain confidential between the two parties, and the Company will provide shareholders with a further update in due course.

The Company has developed a strong, long lasting and wide-ranging patent portfolio for Fruitflow, and it owns four outright patent families for Fruitflow which have a truly global footprint. The Company also holds other valuable intellectual property and trade secrets for the technology. The intellectual property for Fruitflow is of fundamental importance to the Company and its current and future commercial partners, to include DSM and By-Health, and it underpins the numerous commercial opportunities which the Company and its partners are pursuing for Fruitflow.

The Company would like to thank its customers and shareholders for their continued support, and the Board remains positive about the outlook for Fruitflow and the Provexis business for the second half of the financial year and beyond.'

For further information please contact:

Provexis plc Ian Ford, CEO Dawson Buck, Non-executive Chairman	Tel:  [phone]   [e-mail]
Allenby Capital Limited (Nominated Adviser and Broker) Nick Naylor / Liz Kirchner (Corporate Finance) Matt Butlin (Sales and Corporate Broking)	Tel:  [phone]

 

Chairman and CEO's statement

The Company has had an active first six months of the year, seeking to enhance further the commercial prospects of its innovative, patented Fruitflow® heart-health ingredient.

On 4 November 2021 the Company announced that it had entered into a supply and distribution agreement for Fruitflow with By-Health, which followed the Company's extensive work with By-Health over the last five years.

By-Health is seeking to obtain a new permitted health function claim in China for foods such as Fruitflow that can demonstrate an anti-platelet effect, addressing the aberrant blood clots which can lead to heart attacks and strokes. If By-Health is successful in obtaining a new permitted health function claim, it is currently expected that this would result in some significant orders for Fruitflow, potentially at a multiple of current total sales values.

In the six months ended 30 September 2021 total revenues were £211k, 11% behind the prior six month period (2020: £237k), reflecting:

·    A decrease in the net income received from the Company's Alliance Agreement with DSM, which fell by 21% to £135k in the period (2020: £172k);

·An increase in revenue, net of sales rebates, from the Company's Fruitflow+ Omega-3 business, including the Company's website www.fruitflowplus.com, Amazon UK, Holland & Barrett, and the Company's distributor for Fruitflow+ Omega-3 in China through the CBEC channel. This business grew by 34% to £76k in the period (2020: £57k); and

·Amounts of £Nil received in the period for Fruitflow+ nitrates development products, compared to amounts of £8k in the prior period.

The decrease in net income received from the Company's Alliance Agreement with DSM was primarily due to short term lockdowns and other COVID-19 disruptions in some of the growing markets for Fruitflow in the Asia Pacific region, leading to more erratic demand in the short term.

An increasing number of further commercial projects have been initiated by DSM with prospective customers, including some prospective customers which are part of global businesses, and the total projected annual sales value of the prospective sales pipeline for Fruitflow continues to stand at a substantial multiple of existing annual sales.

Loss from operations for the period was £145k, 29% lower than the prior period (2020: £202k).

Underlying operating loss for the period (before share based payments of £28k (2020: £107k), as set out on the face of the Consolidated Statement of Comprehensive Income) was £117k, 22% higher than the prior six month period (2020: £95k).

By-Health Co., Ltd.

On 4 November 2021 the Company announced that it had entered into a supply and distribution agreement (the 'Agreement') for Fruitflow with By-Health, a listed Chinese dietary supplement business with a market capitalisation of approximately £5 billion.

The Agreement, which followed the Company's extensive work with By-Health over the last five years, will take full effect from 1 January 2023 and it gives By-Health exclusive supply and distribution rights to commercialise Fruitflow in Mainland China, Hong Kong, Macau, Taiwan and Australia (the 'Territories').

Under the Agreement:

·  Provexis will be responsible for the manufacture, supply and sale of its Fruitflow heart-health functional food ingredient to By-Health, and it will contribute scientific expertise necessary for successful commercialisation.

· By-Health will be responsible for the manufacture, marketing, and sale of Fruitflow based functional food and dietary supplement finished products in the Territories, through By-Health's extensive sales network. Dietary supplement products such as Fruitflow are required to be authorised by the relevant Government authorities in each of the Territories in respect of health claims.

· By-Health will also have exclusive rights to act as the distributor of Fruitflow as an ingredient in the Territories, selling Fruitflow as an ingredient to other businesses in the Territories which wish to use Fruitflow to manufacture and sell their own Fruitflow based finished products in the Territories.

·Provexis and By-Health will seek to collaborate on research and development projects which may result in the development and approval of Fruitflow as a drug, for potential sale and distribution in the Territories.

The Agreement, which will take full effect from 1 January 2023, commenced on 4 November 2021 and it has a term of ten years, subject to extension and termination clauses.

When the Agreement was signed, Felix Zhang MSc PhD, who is now Executive Director, By-Health Research; and Global Director R&D, commented that:

'The strong science behind Fruitflow fits very well with our 'science-based nutrition' strategy, which focusses on strong science-backed evidence to support health claims which are of benefit to consumers. We look forward to progressing our work with Fruitflow, in partnership with Provexis, towards future significant commercialisation in China and Australia.'

By-Health has since launched a Personalised Customised Vitamin Concept Product, as further detailed at: www.by-health.com/news-4429.

Regulatory progress in China - new permitted health function claim

The Company has previously announced it has been working with By-Health to support the planned launch of a number of Fruitflow based products in the Chinese market, with potential volumes at a significant multiple of current Fruitflow sales.

The planned launch of Fruitflow based products in the Chinese market has been progressing well. Clinical studies conducted in China are typically required to obtain the necessary regulatory clearances in China, and a significant investment in eight separate Fruitflow studies has been undertaken at By-Health's expense.

Five studies have been successfully completed in China, and two clinical studies and one animal study are currently ongoing.

The five completed studies showed excellent results in use for Fruitflow, and they provide strong evidence for its efficacy on platelet functions. The Chinese regulatory system for functional health food ingredients such as Fruitflow is governed by the State Administration for Market Regulation (SAMR), China's top market regulator, and it is based on a defined list of 27 permitted health function claims which brand owners are permitted to use on product labels.

Health function claims are based on test methods and criteria that have been systematically evaluated and verified, and it is currently envisaged that the existing list of 27 permitted health function claims might be reduced to a revised list of 24 permitted claims. The SAMR provides the possibility of adding new health function claims to the list, as long as the claim can be evaluated and verified by the SAMR.

Under SAMR regulations functional health foods need to indicate a relationship between a food or nutrient and a consequent health improvement which falls under one of the permitted health function claims. This relationship must be supported by scientific tests which are performed by the SAMR.

SAMR certified functional health foods are required to use a blue cap / blue hat logo on their product packaging, which identifies products as approved functional health foods.

By-Health's regulatory clearance preparations for Fruitflow were originally focussed on obtaining blue cap health claim status for some Fruitflow based products in China, under the existing 27 permitted health function claim structure.

By-Health is now working on an extensive regulatory submission to the SAMR for Fruitflow, seeking to establish a new permitted health function claim for foods such as Fruitflow that can demonstrate an anti-platelet effect, inhibiting platelet function and conferring beneficial effects for people who are at risk of platelet hyperactivity-associated thrombosis - the aberrant blood clots which lead to heart attacks and strokes.

By-Health has recently updated its website www.by-health.com/en/aboutus stating that it has completed: 'Research comprehensively in the cardiovascular health area. We have developed a new product made with Fruitflow®, popularly known as 'natural Aspirin'. It helps to maintain normal platelet aggregation.'

By-Health currently expects to be in a position to complete the last of its eight studies in 2022, and it will file its regulatory submission to the SAMR for Fruitflow at the appropriate time seeking to obtain a new permitted health function claim which would be in addition to the currently defined list of 27 (reducing to 24) permitted claims. Subject to the timing the new anti-platelet claim, if approved, would therefore represent the 28th - or the 25th - permitted health function claim in China.

If By-Health is successful in obtaining a new permitted health function claim for functional health foods such as Fruitflow that can demonstrate an anti-platelet effect, it is currently expected that this would result in some significant orders for Fruitflow, potentially at a multiple of current total sales values.

Market opportunity

A study backed by scientists from the National Center for Cardiovascular Diseases in China which was updated in 2020 (www.ncbi.nlm.nih.gov/pmc/articles/PMC7008101/#) stated that:

·the prevalence of Cardiovascular Disease ('CVD') in China has been increasing continuously since 2006, with approximately 290 million patients in China who now have CVD; and

· two in five deaths in China are attributed to CVD, with CVD remaining the leading cause of death in 2016.

In December 2020 the World Health Organisation reported (www.who.int/news/item/09-12-2020-who-reveals-leading-causes-of-death-and-disability-worldwide-2000-2019): 'Heart disease has remained the leading cause of death at the global level for the last 20 years. However, it is now killing more people than ever before. The number of deaths from heart disease increased by more than 2 million since 2000, to nearly 9 million in 2019. Heart disease now represents 16% of total deaths from all causes. More than half of the 2 million additional deaths were in the WHO Western Pacific region.' The WHO Western Pacific region includes China.

By-Health's long-term goal of science-based nutrition is to achieve 'comprehensive intervention for human health' (www.by-health.com/en/aboutus), and Fruitflow is well placed to provide such intervention in the Chinese cardiovascular health market.

DSM Nutritional Products

The Company's Alliance partner DSM Nutritional Products ('DSM') has continued to develop the market for Fruitflow in all global markets. More than 100 regional consumer healthcare brands have now been launched by direct customers of DSM, and a number of further regional brands have been launched through DSM's distributor channels.

An increasing number of further commercial projects have been initiated with prospective customers, including some prospective customers which are part of global businesses, and the total projected annual sales value of the prospective sales pipeline for Fruitflow continues to stand at a substantial multiple of existing annual sales.

The Company's alliance agreement with DSM dates back to June 2010, with a contractual term which runs to 31 December 2022.

By default from 1 January 2023 the alliance agreement: (i) permits DSM to continue to sell Fruitflow to its existing customers, on the basis that a royalty on Fruitflow sales, fixed at favourable market conditions, will remain payable to the Company; and (ii) permits the Company to sell Fruitflow as an ingredient directly to third parties, outside the existing profit sharing arrangements.

The Agreement for Fruitflow announced in November 2021 between the Company and By-Health falls under (ii) above, with the Company set to sell Fruitflow as an ingredient directly to By-Health from 1 January 2023; 100% of the Company's sales of Fruitflow to By-Health will accrue directly to the Company, and the Company will retain all of the resulting profits.

The Company and DSM have started and remain currently engaged in constructive negotiations working towards a new agreement. The commercial terms of the negotiations remain confidential between the two parties, and the Company will provide shareholders with a further update in due course.

Supply chain

Fruitflow is currently produced by outsourced third party manufacturers in Europe, and it is intended that the Company will have direct access to these manufacturers for its sales of Fruitflow to third parties. The Company and the third party manufacturers are actively engaged in some ongoing production capacity planning, looking at the steps required to scale-up the production of Fruitflow to meet the anticipated increase in demand.

Fruitflow+ dietary supplement products

Fruitflow+ Omega-3 is available to purchase from the Company's subscription focussed e-commerce website www.fruitflowplus.com, Amazon UK and Holland & Barrett.

The Fruitflow+ Omega-3 business grew by 34% to £76k in the period to 30 September 2021 (2020: £57k), reflecting further growth in subscriber numbers on the www.fruitflowplus.com website which currently stand at a further new all-time high level.

In November 2020 the Company announced it had entered into a distribution agreement with a company which is now acting as the distributor for Fruitflow+ Omega-3 in China, exclusively through the Chinese Cross-Border e-commerce ('CBEC') channel. A first test order was placed by the distributor in the year ended 31 March 2021.

The distribution agreement in China is separate but wholly complementary to the Company's work with By-Health, with the CBEC regulations enabling the distributor to sell Fruitflow+ Omega-3 in China now, prior to the health function claim which By-Health is seeking to secure.

The Company's Fruitflow+ Omega-3 direct selling business has been operating largely as normal throughout the COVID-19 pandemic, and a further new production run of Fruitflow+ Omega-3 capsules was completed in July 2021 thus ensuring continued supply of the product.

The Company is seeking to expand further its commercial activities with Fruitflow+ Omega-3 and other Fruitflow+ combination products, and it is currently in dialogue with some other potential international direct selling customers.

Scientific journal publications

1.  In September 2020 Fruitflow was recognised in a review article by the Frontiers in Nutrition journal www.frontiersin.org/articles/10.3389/fnut.2020.583080/full which stated that nutraceuticals such as Fruitflow may serve as:

'A safe antiplatelet prophylactic treatment for those at high risk of COVID-19 who may also be at increased risk of thrombotic complications and an alternative to pharmacological compounds that may cause greater risk of bleeding.'

2.  In January 2021 a review article was published by the influential journal Medical Hypotheses, a leading peer-reviewed journal which advances new discussion and innovation in medical treatments.

The article www.sciencedirect.com/science/article/pii/S0306987720333715, titled 'Platelet hyperactivity in COVID-19: Can the tomato extract Fruitflow® be used as an antiplatelet regime?' was written by Professor Asim K Duttaroy, who was the original inventor of Fruitflow, and Dr Niamh O'Kennedy, Provexis plc's Chief Scientific Officer.

3.  In January 2021 a review article was published in the MDPI journal Nutrients www.mdpi.com/2072-6643/13/1/144/htm.

The article, titled the 'Role of Gut Microbiota and Their Metabolites on Atherosclerosis, Hypertension and Human Blood Platelet Function' was written by Professor Asim K Duttaroy and it noted that emerging data suggest a strong relationship between microbiota-derived compounds and an increased risk of CVD, with widely accumulated data also indicating that Fruitflow may be useful in the primary prevention of CVD. The article concluded that there is a 'strong possibility of finding new approaches to treat or prevent CVD' with further scientific work required seeking to develop novel preventative or therapeutic regimes.

4.  In June 2021 a further review article was published in the MDPI journal Nutrients www.mdpi.com/2072-6643/13/7/2184/htm.

The article, titled 'Dietary Antiplatelets: A New Perspective on the Health Benefits of the Water-Soluble Tomato Concentrate Fruitflow®' concluded that: 'Platelets have multifaceted functions which generate a complicated set of interactions with other vascular cells, leading to many roles outside haemostasis. As our understanding of the role of platelet activation in response to - and in complicating - inflammatory and infectious illnesses grow, it becomes more apparent that platelet-targeted treatments are necessary outside the field of CVD. Dietary antiplatelets such as Fruitflow® can help provide suitably gentle and safe yet efficacious treatments to improve public health in response to a wide range of health challenges.'

5. In December 2021 a pilot study was published in the BMC Nutrition journal https://bmcnutr.biomedcentral.com/articles/10.1186/s40795-021-00485-5.

The study, titled 'Evaluation of the equivalence of different intakes of Fruitflow in affecting platelet aggregation and thrombin generation capacity in a randomized, double-blinded pilot study in male subjects' concluded that it may be pertinent to personalise the daily intake of Fruitflow® depending on individual platelet response.

The publication of these five articles is a significant opportunity for the Company and DSM to promote Fruitflow further across scientific, trade customer and consumer channels.

Intellectual property

The Company is responsible for filing and maintaining patents and trade marks for Fruitflow as part of the Alliance Agreement with DSM, and patent coverage for Fruitflow now includes the following patent families which are all owned outright by Provexis:

Patent family	Developments in the period from Oct-21 to Dec-21
Improved Fruitflow / Fruit Extracts Improved Fruitflow / Fruit Extracts, with patents granted by the European Patent Office in January 2017 and September 2020. Broad national coverage has been secured. The patent has been granted in eleven other major territories to include China and USA. Applications are at a late stage of progression in a further eight global territories, with potential patent protection out to November 2029.	A Patent has proceeded to grant in the Philippines.
Antihypertensive (blood pressure lowering) effects This patent was originally developed in collaboration with the University of Oslo, and it has now been granted for Fruitflow in Europe, the US and three other major territories. Patent applications are being progressed in a further three major territories to include the US and China, with potential patent protection out to April 2033. In August 2020 the Company announced it had agreed to purchase the background and joint foreground blood pressure lowering IP owned by Inven2 AS, the technology transfer office at the University of Oslo, and Provexis now owns these important patents outright, with the licensing option originally held by Inven2 having been cancelled.	A Canadian patent application has proceeded to grant.
Fruitflow with nitrates in mitigating exercise-induced inflammation and for promoting recovery from intense exercise Patents have been granted around Europe and in the US, Australia, Brazil, China, Hong Kong, Israel, Japan, South Korea, the Philippines, New Zealand and Mexico. Further patent protection is being sought in six territories, with potential patent protection out to December 2033.
Fruitflow for air pollution The use of Fruitflow in protecting against the adverse effects of air pollution on the body's cardiovascular system. Laboratory work has shown that Fruitflow can reduce the platelet activation caused by airborne particulate matter, such as that from diesel emissions, by approximately one third. A US patent has granted; an Indonesian patent application is proceeding to grant; and there are pending applications in 15 jurisdictions (including the US where a further application has been filed) which extends potential patent protection for Fruitflow out to November 2037.	An Indonesian patent application has been accepted for grant.

Outlook

We were delighted to announce a supply and distribution agreement for Fruitflow with By-Health in November 2021, which follows our extensive work with By-Health over the last five years. The agreement will take full effect from 1 January 2023.

By-Health currently expects to be in a position to complete the last of its eight studies in 2022, and it will file its regulatory submission to the SAMR for Fruitflow at the appropriate time, seeking to obtain a new permitted health function claim for foods such as Fruitflow that can demonstrate an anti-platelet effect. If By-Health is successful in obtaining a new permitted health function claim, it is currently expected that this would result in some significant orders for Fruitflow, potentially at a multiple of current total sales values.

Fruitflow is well placed to play an important role in the Chinese cardiovascular health market under the permitted health function claim legislation, and we look forward to working closely with By-Health seeking to maximise the commercial success of this agreement for the benefit of both companies.

The Company and DSM have had a strong long-term relationship, with the shared interest of both companies being to maximise the commercial returns that can be achieved from Fruitflow. The total projected annual sales value of the prospective sales pipeline for Fruitflow continues to stand at a substantial multiple of existing annual sales.

The Alliance Agreement with DSM dates back to June 2010, with a contractual term which runs to 31 December 2022. By default from 1 January 2023 the agreement: (i) permits DSM to continue to sell Fruitflow to its existing customers, on the basis that a royalty on Fruitflow sales, fixed at favourable market conditions, will remain payable to the Company; and (ii) permits the Company to sell Fruitflow as an ingredient directly to third parties, outside the existing profit sharing arrangements.

The Company and DSM have started and remain currently engaged in constructive negotiations working towards a new agreement. The commercial terms of the negotiations remain confidential between the two parties, and the Company will provide shareholders with a further update in due course.

The Company has developed a strong, long lasting and wide-ranging patent portfolio for Fruitflow, and it owns four outright patent families for Fruitflow which have a truly global footprint. The Company also holds other valuable intellectual property and trade secrets for the technology. The intellectual property for Fruitflow is of fundamental importance to the Company and its current and future commercial partners, to include DSM and By-Health, and it underpins the numerous commercial opportunities which the Company and its partners are pursuing for Fruitflow.

The Company would like to thank its customers and shareholders for their continued support, and the Board remains positive about the outlook for Fruitflow and the Provexis business for the second half of the financial year and beyond.

Dawson Buck  Ian Ford

Chairman                                            CEO

 

Consolidated statement of comprehensive income		Unaudited	Unaudited	Audited
Six months ended 30 September 2021		six months	six months	year
		ended	ended	ended
		30 September	30 September	31 March
		2021	2020	2021
		£	£	£
	Notes
Revenue		211,195	237,075	505,330
Cost of goods		(24,287)	(20,728)	(49,136)
Gross profit		186,908	216,347	456,194
Selling and distribution costs		(24,170)	(22,956)	(48,689)
Research and development costs		(140,866)	(135,171)	(303,898)
Administrative costs (including share based payment charges)		(167,101)	(262,104)	(465,523)
R&D tax relief: receivable tax credit		650	1,590	2,460
Underlying operating loss		(116,540)	(95,480)	(224,756)
Share based payment charges - share options		(28,039)	(28,039)	(55,925)
Share based payment charges - blood pressure IP		-	(78,775)	(78,775)
Loss from operations		(144,579)	(202,294)	(359,456)
Finance income		40	87	113
Loss before taxation		(144,539)	(202,207)	(359,343)
Taxation		-	-	-
Loss and total comprehensive expense for the period		(144,539)	(202,207)	(359,343)
Attributable to:
Owners of the parent		(130,164)	(187,832)	(341,007)
Non-controlling interests		(14,375)	(14,375)	(18,336)
Loss and total comprehensive expense for the period		(144,539)	(202,207)	(359,343)
Loss per share to owners of the parent
Basic and diluted - pence	3	(0.01)	(0.01)	(0.02)

 

Consolidated statement of financial position		Unaudited	Unaudited	Audited
30 September 2021		30 September	30 September	31 March
		2021	2020	2021
	Notes	£	£	£
Assets
Current assets
Inventories		107,640	80,997	60,576
Trade and other receivables		94,349	142,177	140,923
Corporation tax asset		14,610	13,090	13,960
Cash and cash equivalents		981,657	156,272	1,077,410
Total current assets		1,198,256	392,536	1,292,869
Total assets		1,198,256	392,536	1,292,869
Liabilities
Current liabilities
Trade and other payables		(172,568)	(169,248)	(150,681)
Total current liabilities		(172,568)	(169,248)	(150,681)
Net current assets		1,025,688	223,288	1,142,188
Total liabilities		(172,568)	(169,248)	(150,681)
Total net assets		1,025,688	223,288	1,142,188
Capital and reserves attributable to
owners of the parent company
Share capital		2,210,822	2,070,822	2,210,822
Share premium reserve		18,675,221	17,767,071	18,675,221
Merger reserve		6,599,174	6,599,174	6,599,174
Retained earnings		(25,931,132)	(25,703,718)	(25,829,007)
		1,554,085	733,349	1,656,210
Non-controlling interest		(528,397)	(510,061)	(514,022)
Total equity		1,025,688	223,288	1,142,188

 

Consolidated statement of cash flows	Unaudited	Unaudited	Audited
30 September 2021	six months	six months	year
	ended	ended	ended
	30 September	30 September	31 March
	2021	2020	2021
	£	£	£
Cash flows from operating activities
Loss after tax	(144,539)	(202,207)	(359,343)
Adjustments for:
Finance income	(40)	(87)	(113)
Tax credit receivable	(650)	(1,590)	(2,460)
Share-based payment charge - share options	28,039	28,039	55,925
Share-based payment charges - blood pressure IP	-	78,775	78,775
Changes in inventories	(47,064)	(70,913)	(50,492)
Changes in trade and other receivables	46,614	(2,459)	(1,374)
Changes in trade and other payables	21,887	19,171	604
Net cash flow from operations	(95,753)	(151,271)	(278,478)
Tax credits received	-	16,202	16,202
Total cash flow from operating activities	(95,753)	(135,069)	(262,276)
Cash flow from investing activities
Purchase of blood pressure IP - cash element	-	-	(250)
Interest received	-	6	201
Total cash flow from investing activities	-	6	(49)
Cash flow from financing activities
Proceeds from issue of share capital	-	-	1,048,400
Total cash flow from financing activities	-	-	1,048,400
Net change in cash and cash equivalents	(95,753)	(135,063)	786,075
Opening cash and cash equivalents	1,077,410	291,335	291,335
Closing cash and cash equivalents	981,657	156,272	1,077,410

 

Consolidated statement of changes in equity	Share	Share	Merger	Retained	Total equity	Non-	Total
30 September 2021	capital	premium	reserve	earnings	attributable to owners of	controlling interests	equity
					the parent
	£	£	£	£	£	£	£
At 31 March 2020	2,059,322	17,699,796	6,599,174	(25,543,925)	814,367	(495,686)	318,681
Share-based charges - share options	-	-	-	28,039	28,039	-	28,039
Share-based charges - blood pressure IP	-	-	-	78,775	78,775	-	78,775
Issue of shares 19 August 2020 - blood pressure IP	11,500	67,275	-	(78,775)	-	-	-
Total comprehensive expense for the period	-	-	-	(187,832)	(187,832)	(14,375)	(202,207)
At 30 September 2020	2,070,822	17,767,071	6,599,174	(25,703,718)	733,349	(510,061)	223,288
Share-based charges - share options	-	-	-	27,886	27,886	-	27,886
Issue of shares 19 August 2020 - blood pressure IP	-	(250)	-	-	(250)	-	(250)
Issue of shares - placing 23 December 2020	133,333	865,417	-	-	998,750	-	998,750
Issue of shares - placing 25 February 2021	6,667	42,983	-	-	49,650	-	49,650
Total comprehensive expense for the period	-	-	-	(153,175)	(153,175)	(3,961)	(157,136)
At 31 March 2021	2,210,822	18,675,221	6,599,174	(25,829,007)	1,656,210	(514,022)	1,142,188
Share-based charges - share options	-	-	-	28,039	28,039	-	28,039
Total comprehensive expense for the period	-	-	-	(130,164)	(130,164)	(14,375)	(144,539)
At 30 September 2021	2,210,822	18,675,221	6,599,174	(25,931,132)	1,554,085	(528,397)	1,025,688

 

1. General information, basis of preparation and accounting policies

General information

Provexis plc is a public limited company incorporated and domiciled in the United Kingdom (registration number 05102907). The address of the registered office is 2 Blagrave Street, Reading, Berkshire RG1 1AZ, UK.

The main activities of the Group are those of developing, licensing and selling the proprietary, scientifically-proven Fruitflow® heart-health functional food ingredient.

Basis of preparation

This condensed financial information has been prepared using accounting policies consistent with International Financial Reporting Standards in the European Union (IFRS).

The same accounting policies, presentation and methods of computation are followed in this condensed financial information as are applied in the Group's latest annual audited financial statements, except as set out below. While the financial figures included in this half-yearly report have been computed in accordance with IFRS applicable to interim periods, this half-yearly report does not contain sufficient information to constitute an interim financial report as that term is defined in IAS 34.

Use of non-GAAP profit measure - underlying operating profit

The directors believe that the operating loss before share based payments measure provides additional useful information for shareholders on underlying trends and performance. This measure is used for internal performance analysis. Underlying operating loss is not defined by IFRS and therefore may not be directly comparable with other companies' adjusted profit measures. It is not intended to be a substitute for, or superior to IFRS measurements of profit.

The interim financial information does not constitute statutory accounts as defined in section 434 of the Companies Act 2006 and has been neither audited nor reviewed by the Company's auditors James Cowper Kreston pursuant to guidance issued by the Auditing Practices Board.

The results for the year ended 31 March 2021 are not statutory accounts. The statutory accounts for the last year ended 31 March 2021 were approved by the Board on 29 September 2021 and are filed at Companies House. The report of the auditors on those accounts was unqualified, and did not contain a statement under section 498 of the Companies Act 2006.

The interim report for the six months ended 30 September 2021 can be downloaded from the Company's website www.provexis.com. Further copies of the interim report and copies of the 2021 annual report and accounts can be obtained by writing to the Company Secretary, Provexis plc, 2 Blagrave Street, Reading, Berkshire RG1 1AZ, UK.

This announcement was approved by the Board of Provexis plc for release on 31 December 2021.

Going concern

The Directors are of the opinion that at 31 December 2021, the Group and Company's liquidity and capital resources are adequate to deliver the current strategic objectives and 2022 business plan and that the Group and Company remain a going concern.

Accounting policies

The accounting policies applied are consistent with those of the annual financial statements for the year ended 31 March 2021, as described in those annual financial statements.

 

2. Segmental reporting

The Group's operating segments are determined based on the Group's internal reporting to the Chief Operating Decision Maker (CODM). The CODM has been determined to be the Board of Directors as it is primarily responsible for the allocation of resources to segments and the assessment of performance of the segments. The performance of operating segments is assessed on revenue.

The CODM uses revenue as the key measure of the segments' results as it reflects the segments' underlying trading performance for the financial period under evaluation. Revenue is reported separately to the CODM and all other reports are prepared as a single business unit.

	Unaudited	Unaudited	Audited
	six months	six months	year
	ended	ended	ended
	30 September	30 September	31 March
	2021	2020	2021
DSM Alliance Agreement	135,188	171,976	357,879
Fruitflow+ Omega-3	76,007	56,753	138,251
Fruitflow+ nitrates development products	-	8,346	9,200
	211,195	237,075	505,330

3. Earnings per share

Basic earnings per share amounts are calculated by dividing the profit attributable to owners of the parent by the weighted average number of ordinary shares in issue during the period.

The loss attributable to equity holders of the Company for the purpose of calculating the fully diluted loss per share is identical to that used for calculating the basic loss per share. The exercise of share options would have the effect of reducing the loss per share and is therefore anti-dilutive under the terms of IAS 33 'Earnings per Share'.

Basic and diluted loss per share amounts are in respect of all activities.

There were 168,500,000 share options in issue at 30 September 2021 (2020: 193,500,000) that are currently anti-dilutive and have therefore been excluded from the calculations of the diluted loss per share.

	Unaudited	Unaudited	Audited
	six months	six months	year
	ended	ended	ended
	30 September	30 September	31 March
	2021	2020	2021
Loss for the period attributable to owners of the parent - £	130,164	187,832	341,007
Weighted average number of shares	2,210,821,523	2,061,960,851	2,102,799,137
Basic and diluted loss per share - pence	0.01	0.01	0.02

 

4. Share capital and Total Voting Rights

At 31 December 2021, the date of this announcement, the Company's issued share capital comprises 2,210,821,523 ordinary shares of 0.1 pence each, each with equal voting rights. The Company does not hold any shares in treasury and therefore the total number of ordinary shares and voting rights in the Company is 2,210,821,523.

The above figure may be used by shareholders in the Company as the denominator for the calculations by which they will determine if they are required to notify their interest in, or change to their interest in, the share capital of the Company under the FCA's Disclosure Guidance and Transparency Rules.

5. Cautionary statement

This document contains certain forward-looking statements with respect to the financial condition, results and operations of the business. These statements involve risk and uncertainty as they relate to events and depend on circumstances that will incur in the future. Nothing in this interim report should be construed as a profit forecast.

 

END

 

 

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