Final Results

RNS Number : 6900L

Venture Life Group PLC

17 May 2022

VENTURE LIFE GROUP PLC

("Venture Life", "VLG" or the "Group")

Final Results

Venture Life (AIM: VLG), a leader in developing, manufacturing and commercialising products for the international self-care market, announces its audited results for the year ended 31 December 2021.

Financial Highlights

· Revenues + 9% to £32.8 million (2020: £30.1 million) or +11% on a constant currency basis

· Gross margin £13.0 million (2020: £12.8 million), gross margin percentage 39.6% (2020: 42.7%)

· Adjusted EBITDA[1] +8% to £6.6million (2020: £6.1 million)

· H2 revenues +36% to £18.9 million compared to H1 revenues

· H2 adjusted EBITDA1 147% to £4.7 million compared to H1 adjusted EBITDA1

· Profit before tax, amortisation and exceptional items £4.6 million (2020: £4.4 million)

· Profit after tax stayed flat year on year at £2.4 million (2020: £2.4 million)

· Adjusted earnings per share[2] 4.94p (2020: 4.46p)

· Operating cash flow before movements in working capital £5.1 million (2020: £6.7 million)

· Cash at 31 December 2021 £5.2 million (2020: £42.1 million)

Commercial Highlights

Group

· Two immediately earnings enhancing acquisitions, now integrated and fully deploying funds raised in late 2020

· Revolving Credit Facility (RCF) in place for up to £50 million, giving significant firepower for further earnings accretive M&A

· Extended agreement with Bayer Consumer Care AG for BV gel and BV pessary, a range of women's intimate healthcare products

· 11 new long-term distributions agreements signed

· 18 in-market product launches through our international partners

· 7 approved product registrations, with 12 on-going

Acquisition of BBI Healthcare Limited, 4 June 2021:

· Three new brands and two new therapy areas: women's health and diabetes management

· Significant partner acquired in women's health - Bayer Consumer Care AG ('Bayer')

· Immediate cost synergies realised

· Significant excess manufacturing capacity in Sweden

· Profitable, with good growth opportunities

Acquisition of Helsinn Integrative Care Portfolio, 6 August 2021

· 3 new brands and new therapy area of oncology support

· Profitable portfolio, with good growth opportunities

· 33 newly acquired partners, spanning 56 countries

· Geographic extension opportunities

Post period end

· New exclusive Chinese distributor appointed for oral care brands, Dentyl and UltraDEX; this 5-year agreement commenced 6^th January 2022 and runs until 2027

· Clinical trial peer-reviewed and published by Cardiff University in the Journal of Lipid Research, concluding that the CPC-based mouthwash tested showed the inactivation of SARS-CoV-2 in the saliva for up to 1 hour

· Net debt reduction arising from cash collection following strong Q4 revenue

· Despite a challenging first quarter, we benefit from a strong order book and the growth being achieved from recent acquisitions

Jerry Randall, CEO of Venture Life Group plc commented: "2021 saw a year of significant growth for the Group, despite the challenges we faced. We are delighted to have completed two immediately earnings enhancing acquisitions that are now both integrated into the Group and performing well, and both showing growth over 2020.

Whilst we have seen a material impact on the Group's results from the acquisitions, for the part of the year we owned them, 2022 will see the full year effect of these. The strategy of raising the cash in advance has, I believe, proved to be a good one, enabling us to access and complete both of these acquisitions within just 8 months of raising the cash; I thank each and every one of our shareholders who supported us in that fund raise. The £50 million RCF facility we also have in hand now will enable us to continue such progress in a non-dilutive manner in the near term.

The issues with supply chain are well documented across the globe and we were impacted by these significantly in 2021, eroding margin and causing continual headaches for us ensuring certainty of supply for raw materials and packaging. These supply chain challenges persist, and we have instigated customer price rises and other measures going forward to mitigate these where possible. I must highly commend our purchasing and logistics teams, who have been battling this all year, and who continue to do so, and who have worked tirelessly to minimise cost increases and manage the extended lead times we are seeing.

We continued to see the impact of COVID on our customers, in particular in the first half of 2021, but we are now beginning to see the green shoots of recovery with these customers. I am very pleased that we have been able to appoint a new distributor for our China business, Samarkand Global plc, and we look forward to returning the Chinese market to a significant contributor to the Group going forward.

2021 has been a transformational year for the Group, significantly increasing its size and operation, now having a second manufacturing facility, based in Sweden. I welcome all the people from BBI that joined the Group, and who have already contributed significantly to the business in our hands. I welcome Danny Wells as our new CFO, who took up post in December after joining as part of the BBI acquisition. Danny has already made a positive impact on the business. I also welcome Paul McGreevy as our new Chair, as announced today, who will bring his wealth of experience to our Board. In turn, I would like to extend our deep thanks to Dr Lynn Drummond, who steps down as Chair today, for all that she has done for the Company since joining our Board in 2013, prior to our flotation on AIM, and in particular for her wise counsel as we have grown the business to where it is today. I offer my thanks again to every single member of the Venture Life Group, for their hard work and dedication through 2021, to keep the business growing and developing, and delivering our customers' requirements. We enter 2022 with an order book comfortably ahead of that at the same time last year, on a like for like basis, (taking account of the acquired businesses), which gives us confidence for the year ahead in how our customers will be performing. The supply chain issues have continued into 2022, and with the current situation are likely to persisit through this year, but I am confident our team is well placed to manage the ever changing situation to the best of its ability."

For further information, please contact:

Venture Life Group PLC +44 (0) 1344 578004

Jerry Randall, Chief Executive Officer

Daniel Wells, Chief Financial Officer

Cenkos Securities plc (Nomad and Joint Broker) +44 (0) 20 7397 8900

Stephen Keys / Camilla Hume (Corporate Finance)

Russell Kerr / Michael Johnson (Sales)

Singer Capital Markets (Joint Broker)

Shaun Dobson / Alaina Wong (Corporate Finance) +44 (0) 20 74963000

Jonathan Dighe (Sales)

About Venture Life ( www.venture-life.com )

Venture Life is an international consumer self-care company focused on developing, manufacturingand commercialising products for the global self-care market. With operations in the UK, Italy, The Netherlands and Sweden, the Group's product portfolio includes some key products such as the UltraDEX and Dentyl oral care product ranges, the Balance Activ range in the area of women's intimate healthcare, the Lift and Glucogel product ranges for hypoglycaemia, Gelclair and Pomi-T for oncology support, products for fungal infections and proctology, and dermo-cosmetics for addressing the signs of ageing. Its products are sold in over 90 countries worldwide.

The products, which are typically recommended by pharmacists or healthcare practitioners, are available primarily through pharmacies and grocery multiples. In the UK and The Netherlands these are supplied direct by the company to retailers, elsewhere they are supplied by the Group's international distribution partners.

Through its two Development & Manufacturing operations in Italy and Sweden, the Group also provides development and manufacturing services to companies in the medical devices and cosmetic sectors.

Chair's Statement

2021 has seen a year of continued progress in the Venture Life Group, despite the impact of many COVID related factors. Whilst we experienced our customers feeling the impact of COVID, affecting revenues and product mix, and input costs rising significantly, we still saw growth in revenues and adjusted EBITDA. Input costs and product mix negatively affected gross margin, but the two acquisitions we made during the year carried higher gross margins which went some way to mitigate these negative gross margin impacts of input costs.

The Group proved to be resilient in these difficult times and continued to build its presence with two immediately earnings enhancing acquisitions in the year. I must give my congratulations and thanks to the whole team who both acquired and integrated these businesses in the year yet at the same time, ensuring business continuity - a substantial achievement against the backdrop of the continuing challenges of COVID.

BBI Healthcare Limited (BBI) was acquired in June 2021 and brought an immediately earnings enhancing business and three exciting new brands. At the time of raising the funds in late 2020 from shareholders, this opportunity was not even in play for us, but within 6 months of closing the fund raise we had executed and won a tough competitive auction process for this valued asset. With exciting growing brands, only at the start of their geographic exploitation, and in two of the most interesting self-care categories (women's health and diabetes), I am certain this will prove to be a very valuable acquisition for the Group.

The Helsinn Integrative Care Portfolio (HICP) that we acquired in August also brought some interesting brands ready for further exploitation. This immediately earnings enhancing opportunistic acquisition has brought us into another interesting and underserved self-care category, that of oncology support where products will be acquired primarily by the patient to deal with the very difficult side effects of oncology treatment through pharmacies and grocery multiples..

These acquisitions have now been successfully integrated into the Group, and we have already seen the benefit of expected synergies and the higher gross margins within the Group. Related to the BBIH acquisition, the extremely high-quality manufacturing operations at the Gnesta site in Sweden are now under the umbrella of our technical team in Italy, working to deliver synergies between and harmonisation of the two facilities. During the year, we also put in place a £50 million revolving credit facility with our main banker, Santander Group, alongside Silicon Valley Bank. This facility will enable us to continue with our acquisition strategy without recourse to additional equity from shareholders and was largely undeployed as at the end of the financial year (£9.0 million funds drawn). With projects under review, we are confident that this will allow us to add more immediately earnings enhancing brands to our business in 2022 and beyond, as there continues to be interesting opportunities available.

During the first year of the pandemic (2020), the Group benefitted from some significant revenue items that did not repeat in 2021. The initiation of the hand sanitiser gel (HSG) manufacture, whilst helping the Lombardy health authorities as COVID hit hard in 2020, also provided significant one-off opportunistic revenues and margin to the Group, showing how the business can be reactive as well as proactive. Our Chinese partner performed very well at the back end of 2019 and early in 2020, but was impacted by the pandemic to such an extent, that in late December 2020 we had to take the step to terminate the relationship with them and appoint a new partner for China, Samarkand Global plc. Our previous partner in China proved that our products sell very well in China when marketed properly, and we are confident our new partner will succeed in China with our oral care brands. As a UK based business with operations in China, our interactions with them are much more straightforward than dealing directly with a Chinese partner.

Our Venture Life Brands (VLG Brands) continued to be resilient in 2021, and in particular oral care brands performing well in the UK market in relation to their peers in the recovery from the COVID pandemic. The new brands recently acquired are also performing extremely well and already our team have increased the presence of these products through extending existing partnerships and striking new partner distribution agreements. Also, our Customer Brands revenues remained resilient during the period: weaker performance from some of our partners being negatively affected by COVID was mitigated by new business from both new and existing partners. The challenges of operating manufacturing facilities under COVID lockdowns have been managed superbly by the teams at Biokosmes and Gnesta, and I give particular thanks to the teams there which ensured we had no interruption to production at any time.

The challenges presented in 2021 by COVID caused us to deliver weaker performance than we had expected to at the outset. Despite the weak first half of the year, we generated revenues in the second half of the year of £18.9 million (36% increase over H1) and adjusted EBITDA of £4.7 million (147% increase over H1), reflecting the positive impact of the acquisitions on our trading and showing the scale of the business going forward into 2022, where we will see a full year impact of these acquisitions. We ended the year with full year revenue and adjusted EBITDA growth of 9% and 8% respectively, a much broader brand portfolio, and increased manufacturing operations and capacity. On a proforma basis (assuming BBI and HICP had been part of the business for the whole year) our revenues would have been £37.8 million. Looking into 2022, we expect to see continued organic growth within the portfolio, a significant part of which will be coming from our 2021 acquisitions, which we also expect to supplement with immediately earnings enhancing acquisitions, giving the Board every confidence for the year ahead.

I would like to take this opportunity to thank our fantastic team at Venture Life, who have again proven to be diligent, resilient, hardworking and creative in the face of challenging times. It has been a pleasure to welcome the BBI team into the Group, and they have already made a significant contribution to the business, including Danny Wells, who is now our new Chief Financial Officer. The Board offers its thanks to Andrew Waters, our outgoing CFO, for his time at Venture Life, and wish him every success for the future.

Finally, I would like thank the shareholders who have continued to support us through this challenging year, and we look forward to sharing the progress of 2022 with you all as we move through this year.

Dr Lynn Drummond

Non-executive Chair

16 May 2022

Chief Executive Officer's Statement

Operating review

This year saw significant growth in the Group as we made two immediately earnings enhancing acquisitions in the summer, fully utilising the cash we raised from shareholders within an 8-month timeframe. The target of both acquisitions was to bring in interesting, complementary brands and products that could successfully leverage the operational capacity and distribution capability of the Group. The integration of these two businesses has proceeded to plan in the second half of the year, with the products and the BBI team/operations now fully integrated within the Group. These two acquisitions have contributed £8.4 million of partial year revenues into the total Group revenues of £32.8 million for 2021, and will contribute a full year of revenues in 2022. The team has already locked in the anticipated cost synergies and made significant progress in the further commercialisation of the brands.

Against this strong acquisitive growth, the Group saw a reduction in legacy revenues, substantially driven by COVID; despite this, the Group delivered 9% growth in revenues to £32.8 million (2020: £30.1 million) in the year, +11% on a constant currency basis. The reductions in revenue came from a reduction in sales to partners who were impacted by COVID (either through lower sell out in 2021 or due to running down higher than normal inventory levels at the start of 2021), and from a reduced level of hand sanitiser gel (HSG) sales, which had given us a significant one-off benefit in 2020.

Due to the acquisition of BBI and HICP, the second half of the year saw revenues from VLG brands exceed 50% of the overall revenue of the Group for the first time. Full year revenues from VLG Brands were £17.9 million (2020: £14.9 million), and from Customer Brands £14.8 million (2020: £15.2 million). Revenues from VLG Brands represented 66% of overall revenues in the second half of 2021 (vs. 42% in the second half of 2020), reflecting the impact of the acquisitions, delivering an overall share of 54% for the whole of 2021, compared to 49% in 2020, which included a a significant amount for HSG. With organic growth on the higher margin VLG Brands expected to exceed that of our Customer Brands, coupled with continued selective brand acquisitions, we would expect the higher margin VLG Brand revenues to continue to increase as a percentage of overall revenues, which would precipitate a continued improvement in the gross margin going forward.

A large contributor of the reduction in VLG Brand revenues was our Chinese partner, which covers both Dentyl and UltraDEX. Sales to this partner totalled £0.3 million in 2021, compared to £2.4 million in 2020. Due to the underperformance seen in 2021 and their failure to recover, we terminated with this agreement late December 2021 and signed a new agreement with Samarkand Global plc early January 2022.

Gross margin for the year of £13.0 million was at a very similar level to the previous year (2020: £12.8 million). The gross margin percentage was lower at 39.6% (2020: 42.7%) due to a combination of factors:

- Increased supply prices

- Increased inbound transportation costs

- Non-repeat of high margin Hand Sanitizer Gel (HSG)

- Product mix

The overall impact of these factors contributed a reduction of 6.1% in the gross margin for the Group, compared to that seen in 2020. Increased supply prices represented 1.2% of the reduction, increased inbound transport costs caused a reduction of 0.4%, non-repeated highly profitable HSG sales attributed 3.5% and the balance coming from other product mix sales.

The increased supply prices and transport costs have been widely reported globally and have affected our business, as with many. We experienced these issues in 2021 and they are persisting in 2022. There are challenges around price, availability and delivery lead times of raw materials and packaging, that our team have to manage daily. Significant increased energy prices affect operational costs and supplier component and material costs, with inflationary pressure and logistic challenges. The Group is using mitigation strategies, passing on price increases where possible, securing continuity of supply and fixing prices within the supply base as well as sourcing alternative suppliers. The recent Ukraine crisis has also affected supplies of some raw materials from those impacted territories directly and in secondary derivatives.

The previous financial year benefitted from £3.6 million of HSG sales, compared to only £0.2 million in 2021. These revenues in 2020 were at a high margin as it was completely demand driven; we witnessed very significant immediate demand as there was a significant shortage of supply. The gross margin earned on these revenues in 2020 amounted to £2.1 million (representing 58%) which included the positive impact on other products arising from increased throughput. Without the revenue and margin from HSG in 2020, the Group gross margin for 2020 would have been 40.4%.

In the second half of the year however, the impact of the acquired businesses and growth in revenues lifted gross margin to 42.4%, being more representative of the business going forward. The overall 3.1% reduction in gross margin to 39.6% (2020: 42.7%) reflects the adverse impact of supply chain pressures and product mix as outlined (6.1%) offset by the positive impact of M&A activity (3.0%).

The Group generated adjusted EBITDA of £6.6 million for the year (2020: £6.1 million), an increase of 8% over the previous year. Despite higher revenues, the challenges on gross margin percentage meant minimal increase in the gross margin earned in the year compared to 2020, and tight cost control has helped to deliver adjusted EBITDA margin of 20%. It is expected that this percentage margin will increase in 2022 and beyond as we see the full year effect of the BBI & HHIC acquisitions alongside organic growth.

Acquisitions

During the year, the Group made two immediately earnings enhancing acquisitions, utilising the funds raised (£34.1 million) from shareholders in December 2020, which have positively impacted the results of the Group in 2022.

BBI Healthcare Limited

BBI was acquired for £35 million (with a possible additional deferred payment of £1 million), on 4^th June 2021. Headquartered in the UK, the business also had its own dedicated manufacturing facility in Gnesta, Sweden, which manufactures its Balance Activ ^Ò product for bacterial vaginosis. The acquisition was immediately earnings enhancing for the Group, and brought strong brands, products and customers in the areas of women's intimate health and diabetes support. In the year ended 31^st December 2020, the business produced revenues of £10.3 million and adjusted EBITDA of £2.5 million. The business experienced strong growth in 2020 and this continued in 2021 and is set to continue into 2022.

In the area of women's intimate health, the key brand of the business is Balance Activ for the treatment of bacterial vaginosis - the Balance Activ brand is sold in the UK, The Netherlands and Austria only, mainly in the gel form, and is the number one brand on Amazon for the treatment of bacterial vaginosis. The product is also sold under partner brands in some international territories, the most notable of which is through the partner Bayer Consumer Care AG. This agreement covers both the gel and pessary format, spans 51 countries and extends until 2030.

The acquisition also brought two brands in the area of diabetes support. Glucogel is a thick gel, sold mainly under prescription, to support diabetics when they experience low blood sugar. This product has been on the market almost 40 years and is sold only in the UK to date. Lift is a more consumer facing product to again provide glucose supplementation. Sold as chewable tablets or a juice shot, this provides a measured dose of glucose to support diabetic patients with low blood sugar. The product was launched in 2008 and is sold mainly in the UK/Ireland and through some smaller distributors across Europe.

Helsinn Integrative Care Portfolio (HICP)

The HICP was acquired on 6th August 2021 for a total price of CHF5.0 million (£4.8 million), 50% was paid on 6^th August 2021, and the balance is due on 6^th August 2022. There are no performance criteria attached to the second payment, it is merely deferred for 12 months after completion. In the year ended 31^st December 2020, the portfolio produced revenues of CHF3.6 million (£2.9 million). The trading for 2020 was impacted by Covid and the reduction of cancer treatments being administered, but there is significant potential for growth from this point, which we saw in 2021.

The portfolio comprised three on-market products in the area of oncology support:

- Gelclair - a muco-adhesive oral rinse gel used for the management of painful symptoms of oral mucositis (side effect of some cancer therapies). Gelclair is a registered medical device and is currently partnered in 34 countries;

- Pomi-T - a Polyphenol rich mix of wholefoods used for the management of prostate specific antigen (PSA) levels in prostate cancer. Pomi-T is a registered food supplement and is currently partnered in 22 markets; and

- Xonrid - a Hyaluronic acid based topical gel used for the prevention and treatment of radiation induced dermatitis. Xonrid is a registered medical device and currently partnered in 22 countries.

Venture Life Group (VLG) Brands

Oral Care - UltraDEX and Dentyl

Revenues for UltraDEX fell 20% to £2.5 million (2020: £3.1 million) throughout 2021, which was mainly due to the underperformance in China and the continuation of the pandemic. The decline was not as steep in the UK, with a 7%/£0.2 million decline year-on-year. Across all retailers in the UK, UltraDEX saw a 7% growth year-on-year in EPOS sell out, despite our revenues into retailers being in decline by 7%, due to high stock levels in retailers at the end of 2020.

Despite the oral care market declining in the UK by 3.4%/£5 million[3], UltraDEX improved its position from number 7 in the total oral care market to number 6, ahead of AquaFresh. 2022, UltraDEX also became the market leader within the halitosis sub-category, taking 4% market share from its nearest rival CB12 (Mylan owned). As we move into 2022, we feel confident the brand has stabilised and we should see signs of recovery as we move through 2022.

Revenues for Dentyl in the UK were slightly ahead of previous year at £2.5 million (2020: £2.4 million). Dentyl is now the number 4 in the UK market, with only Listerine, Colgate and Corsodyl ahead of it. Due to the increased costs affecting this brand in particular throughout H2 2021, a cost price increase was introduced and became effective January 1^st January 2022. This will help to mitigate the escalating costs seen in 2021.

Including China, overall revenues for Dentyl fell by 33% to £2.8 million (2020: £4.2 million), our Chinese partner being responsible for the vast majority of this reduction; the underperformance of our Chinese partner has been well-documented, and this partner was terminated in December 2021. In January 2022, we appointed a new partner - Samarkand Global plc.

Cardiff University completed their clinical study on Dentyl and it was published as a pre-print on the Medrxiv website; we announced this to the market on 21^st February 2022. Further to this, on 19^th April 2022, it was finally independently peer-reviewed and published in the Journal of Lipid Research, concluding that the CPC based mouthwash tested showed the inactivation of SARS-CoV-2 in the saliva for up to 1 hour.

Women's Intimate Health - Balance Activ

On a proforma basis (that is considering the full year revenues for 2021, not just those since acquisition), revenues for Balance Activ in the UK grew by 33% to £2.2 million (2020: £1.7 million), which was largely driven by Amazon sales. The UK Women's Intimate Health market saw a +2% growth with a retail market value of £45.6 million in 2021 vs. 2020[4]. Of this, the BV sub-category is worth £5.4 million and Balance Activ currently holds 35% market share of this sub-category.

On a global basis, the product/brand grew by 0.8% to £5.1 million (2020: £5.1 million). Outside the UK, the product is partnered in 64 countries, although only sold currently in 34 countries, and its largest partner is Bayer Consumer Care AG. In July 2021, the BV gel received registration approval in Brazil from ANVISA, its regulatory body and the product will launch in H2 2022. In addition, there were 11 partner launches of the product in 2021, with 8 more expected in Q1 2022.

We believe there are growth opportunities not only within the UK under the Balance Activ brand, but also geographic expansion opportunities across key markets globally, and the team remain focussed on these opportunities moving into 2022.

Women's Health - Fertility Gel

A newly developed Fertility Gel was acquired as part of BBI Healthcare and this gel launched in the UK market in Q3 2021 under our partners' brand. Launch into other markets such as France and Germany will be dependent on sales progression and success seen in the UK.

Diabetes Management - Glucogel and Lift

We acquired two brands within the diabetic management category - Glucogel and Lift. On a proforma basis, revenue for both brands together grew by 19% to £5.2 million (2020: £4.3 million), which was largely driven by Lift. Available in UK pharmacies, health and beauty and grocery channels as well as online, this provides a convenient solution for those patients experiencing hypoglycaemia. There are almost 5 million diabetic patients in the UK[5], with 850,000 people currently living with undiagnosed type 2 diabetes, and this figure is only set to grow.

In addition, Glucogel is currently the number 1 prescribed product for treating hypoglycaemia and is positioned towards more serious attacks. Revenues grew by 6% in 2021 on a proforma basis to £2.1 million, and this business is expected to remain steady as we move into 2022.

Oncology Support - Gelclair and Pomi-T

As part of the HICP acquisition, we now have 2 key brands that sit within oncology support - Gelclair and Pomi-T. On a proforma basis, Gelclair revenues grew by 27% to £1.4 million (2020: £1.1 million) and this growth was helped by the recovery of some cancer treatments as COVID receded somewhat in 2021. It is partnered in 34 markets globally, with some key markets to be targeted, e.g., USA, Brazil and Canada, as well as key EU markets in 2022. Q4 2021 saw the launch of Gelclair in Japan through our partner Terumo.

On a proforma basis, Pomi-T revenues stayed flat at £1.4 million (2020: £1.4 million). In 2021, with only active partners in 5 markets, we see an opportunity for geographic expansion. In Q4 2021, a new long-term distribution agreement was concluded for Pomi-T in Germany, with other discussions underway.

Nail & Foot Care Portfolio

Revenues for the full year 2021 were £2.5 million (2020: £2.5 million), so consistent with the prior year on a constant currency basis. This part of the business was impacted by lockdowns early in 2021 and then again in December 2021, as The Netherlands re-entered lockdown. In 2021, the manufacturing transfer of all the ex-PharmaSource liquid products to our own manufacturing facility completed, which has meant greater control over the whole purchasing and manufacturing process. We saw a number of new launches in 2021, however, these were offset by a slightly weaker performance in Europe with some key partners, mainly down due to COVID.

Across the whole VLG brands portfolio, there were 11 new, long-term distribution agreements signed in 2021 (including those of Bayer Consumer Care AG previously announced), some of which impacted in 2021, and some that will impact positively in 2022. We saw 18 in-market product launches by our partners in various countries throughout 2021, with 7 approved registrations and a further 12 on-going registrations at present.

Customer Brands

Revenues from Customer Brands slightly reduced by 2.6% to £14.8 million (2020: £15.2 million) due to the reclassification of revenues on the HICP assets post-acquisition from Customer Brands to VLG Brands. Aside from this factor, the customer revenues remained flat year-on-year. We saw revenue growth from some new and existing partners, but also some revenue reductions from some partners underperforming for us in the year, either as a result of reduced sell out or due to de-stocking higher than normal inventory levels at the start of the year. In 2020, we saw partners generally continuing to buy from us at the same level as in previous years, as despite lower sell out (due to lockdowns), they wanted to ensure they would not run out of inventory due to supply chain interruptions that were seen in the first COVID pandemic. This left a number of partners with higher-than-normal inventory levels at the end of 2020, and given the on-going lockdowns seen at the start of 2021 across Europe in particular, it meant some of our partners did not purchase as much from us in 2021.

Operating Leverage and Capacity

84% of the revenues delivered by the Group are manufactured at our own development and manufacturing facilities that we have within the Group. The newly acquired Lift and Glucogel products (from the BBI acquisition) and a handful of smaller products are currently made externally. Our expertise as a Group is in the manufacture of liquids, creams and gels, from 3ml to 1 litre capacity. One of the Group's very valuable areas of expertise is in the manufacture of the medical devices, a regulatory category below that of drugs - it is, however, still subject to rigorous regulation. In addition we also manufacture products registered as a cosmetic. The facilities have been frequently inspected by regulatory authorities internationally , and products made at the Group's facilities are approved to ship into over 90 countries worldwide.

Our Italian facility, Biokosmes Srl, based in Bosisio Parini, north of Milan, develops and manufactures most of the internally manufactured products, and our second site at Gnesta, Sweden, which was part of the BBI acquisition, manufactures the bacterial vaginosis gel. Both of these facilities are certified to ISO 13485 for medical devices, a key part of the Group's expertise. We invested significantly during 2020 to materially increase the manufacturing capacity at Biokosmes, and this increased our approximate capacity for production to 55 million units per annum - in 2021, we manufactured 25 million units, leaving 55% spare capacity.

At the Gnesta site, we produced 13 million tubes of BV out of a total capacity of 75 million tubes. There is significant capacity available to utilise the highly automated, efficient equipment at Gnesta for manufacturing other products in the same format (long neck tubes), and we are currently evaluating with a number of potential new customers for this.

The Group now has significant capacity for growth, which accommodates both organic and acquired growth. Beyond this, the Group has the opportunity to expand production further through:

- increasing the footprint of the current factory in Italy and leasing further nearby buildings to continue capacity expansion if required, beyond the current 55 million pieces per annum, and

- utilising the significant free space at the Gnesta plant to provide additional capacity for manufacturing liquid products, on top of the 75 million capacity of the existing equipment.

Increasing the volumes through the facilities will generate additional revenues, which is not expected to require significant additional indirect costs to produce, and so the majority of incremental gross margin generated would fall through to the bottom line.

Revolving Credit Facility (RCF)

In August 2021, the Group entered into a RCF with its main bank, Santander Group, alongside Silicon Valley Bank. This facility has an initial approval for £30 million draw, with an accordion facility for a further £20 million subject to the banks' ratification. The facility runs for an initial term of three years and attracts interest of 2.5% above SONIA. There are no capital repayments required during the term. The facility drawdown is limited to a gross amount 2.5 times the trailing adjusted EBITDA of the Group (also adjusted for IFRS16 charges), plus 2.5 times the trailing adjusted EBITDA of any target we are using the facility to acquire. With net £9.0 million drawn at 31^st December 2021 and an outstanding liability of £8.5 million, which has been used to pay down all other debt in the Group (Italian debt) and the first payment for HICP, we expect this facility to reduce as we go forward through cash generation, before any further acquisitions.

We put the facility in place to utilise the cash generative nature of the business to help fund future acquisitions without the dilutive effect of an equity raise. The Group is actively reviewing a number of immediately earnings enhancing acquisitions that it could make utilising this facility.

Focus on Sustainability

As a business that has already undertaken many initiatives to improve its sustainability and reduce the impact of its operations on the environment, during the year we formed an ESG Committee to focus and develop our drive towards increased sustainability. The committee includes members from the Group Board and employees from the business, and will engage with all key stakeholders in this process - our aim is to become a trusted, responsible and sustainable business.

Our 5 step approach over the next twelve months will be:

· Form and develop our ESG leadership team from a diverse and accurate representation of our stakeholders.

· Consult with stakeholders to understand and align expectations in being a trusted, responsible and sustainable business.

· Following the stakeholder consultation, identify our pritority goals and ensure alignment to the SDGs.

· Creating our KPIs, their baseline and measurement methods against which to track progress.

· Regular reporting and transparency of progress to all our stakeholders.

As outlined within our ESG strategy, as a business we already undertake many initiatives towards our goal to become a trusted, responsible and sustainable business, and we look forward to engaging with and informing all our stakeholders on our progress against this objective in the future.

Summary & Outlook

As already highlighted, 2021 presented challenges to the Group, due to the impact of Covid. This pandemic impacted the performance of certain partners as well as our own customers, and caused severe disruption to supply chain and logistics, in terms of both time and money. The whole team has worked tirelessly to minimise the impact of these on the business during the year. The two earnings enhancing acquisitions in the Summer contributed significantly to the second half revenues, which were 36% ahead of the first half revenues, and which had a commensurate impact on gross margin and adjusted EBITDA in the second half, with adjusted EBITDA being 147% higher in the second half compared to the first half. The operational leverage of the Group and the great concentration of higher margin VLG Brands in the Group have contributed to higher gross margins in the second half, to mitigate some of the impact on gross margin seen through the year.

We have seen an encouraging start to 2022, with the current order book comfortably ahead of the same time last year on a like for like basis, including the acquired businesses. This reflects growth in the underlying business plus the effect of customers supporting us by ordering further forward to help manage supply chain disruption and secure stock, which gives us greater visibility of revenues. Good commercial progress has already been made in 2022 to date, including the appointment of our new partner for the Chinese market, and customer price increases being put in place to further mitigate the cost increases seen in 2021. The supply chain issues experienced in 2021 are expected to continue for some time for all businesses, and we have put in place strategies and procedures with both our suppliers and customers to address these. However, the current level of supply chain disruption is unprecedented and cannot be underestimated; our supply chain team is reacting daily to its changes. I would like to thank the whole team at Venture Life for all their hard work and dedication through this very difficult year, and also those shareholders who continued to support us despite the challenges we faced.

Having made some very good immediately earnings enhancing acquisitions and worked hard to mitigate difficult trading factors seen in 2021, we have a much stronger consolidated business going into 2022, evidenced by the stronger order book, with a much higher proportion of high margin VLG Brands, and the significantly increased revenues and profit in the second half. This growth in size, along with plenty of internal manufacturing capacity available, and coupled with our partners' growing confidence coming out of Covid, gives us a solid foundation for future organic growth. The operational priorites for the Group in 2022 are:

· To invest in and drive organic growth of our VLG Brands, with our partners and through innovation;

· To continue to manage the supply chain disruption to minimise impact on our customers and our profitability;

· To develop and progress our ESG agenda towards becoming a more trusted, responsible and sustainable business; and

· To consider opportunities for selective earnings enhancing acquisitions, utilising the substantially undeployed RCF.

Jerry Randall

Chief Executive Officer

16 May 2022

Financial Review

Chief Financial Officer's Statement

The Group delivered another year of revenue and EBITDA growth as it continued to execute its Buy and Build strategy through the acquisition of the BBI Healthcare business and the HICP assets plus growth in the core business (excluding sales of hand sanitiser gel and sales to China). The impact of the acquisitions has seen revenues from higher margin generating VLG Brands exceed 50% of overall revenue of the Group for the first time and a gross margin % improvement of 2.0ppts in the second half of the year (excluding HSG). Momentum is building post acquisitions as demonstrated by Q4 revenues 59% above that in Q3 driven by a full quarter of revenues from the newly enlarged Group.

Statement of Comprehensive Income

The Group reported 2021 revenues of £32.8 million, an increase of 9% over the £30.1 million reported in 2020. The Group comprises of two segments: Venture Life Brands and Customer Brands. The Venture Life Brands business reported strong growth of 21.6% to £18.0 million (2020: £14.9 million) driven by the in-year impact of new acqusiitons. The BBI Healthcare business acquired on 4 June 2021 and Helsinn Healthcare assets acquired on 6 August 2021 delivered £6.5 million and £1.9 million of revenue respectively for the period post-acquisition.

Sales of the Group's other branded products reduced to £9.4m (2020: £14.7m), which was largely attributable to non-repeated hand sanitzer gel sales (£3.4 million net impact) and under-performance of the previous partner for China (£2.1 million net impact). As such, excluding these adverse impacts, the underlying performance of the rest of the portfolio achieved growth of £0.2m / 1.4%.

The Customer Brands business reported revenues (excluding intercompany sales) of £14.8 million, a reduction of 2.5% versus 2020. The reported revenue excludes sales of £0.5m related to Helsinn Healthcare, which were accounted for as intercompany sales post acquisition. On a like for like basis, the Customer Brands business remained flat year-on-year. As well as developing and manufacturing the majority of the Venture Life brands, this part of the business is also focused on the development and manufacture of products on behalf of third parties, sold under their brands.

Results for the year

	2021	2020	Change
	£'000	£'000	%
Revenue	32,762	30,076	8.9%
Gross profit	12,958	12,847	0.9%
Gross profit margin	39.6%	42.7%
Amortisation	(2,287)	(909)
Other income	338	169
Exceptional costs	(1,331)	(167)
Operating profit	1,371	3,555	(61.4%)
Operating profit margin	4.2%	11.8%
Net Finance expense	(425)	(279)
Profit before tax	946	3,276	(71.1%)
Tax	1,456	(908)
Profit for the year	2,402	2,368	1.4%

Earnings Per Share
Basic / pence	1.91	2.74
Diluted / pence	1.79	2.53
Adjusted / pence	4.94	4.46
Annual dividend per share / pence	-	-
Net cash at end of period / £000s	(7,494)	30,917

Gross margin for the year of £13.0 million was at a very similar level to the previous year (2020: £12.8 million) although the gross margin percentage was lower at 39.6% (2020: 42.7%) due to a combination of increased supply prices, increased inbound transportation costs, product mix and non-repeat of high margin hand sanitiser gel sales. The overall impact of these factors contributed a reduction of 6.1% in the gross margin for the Group, compared to that seen in 2020 which was partially mitigated by the positive in-year impact from margin accretive M&A activity of 3.0%.

The Euro weakened against Sterling by 3.1% during 2021 (based on average FX rate), which had an overall negative impact on the reported revenue and operating profit of the Group as most of the Group's gross margins continue to be Euro denominated.

Administrative expenses increased in the period to £10.6 million from £9.3 million in 2020, an increase of £1.3 million. Of this increase, £1.0 million related to the inclusion of the BBI Healthcare operation, £1.7m comprised higher non-cash costs of amortisation and depreciation arising from new acquisitions, offset by a reduction in net R&D expenditure of £0.3 million and a favourable movement in the required level of debtor provisions being £0.5 million. The remaining reduction of £0.6 million reduction was due to the non-repeat of bonus payments made in 2020.

Adjusted EBITDA (as defined by EBITDA excluding share based payments and exceptional items) increased 8.2% to £6.6 million (2020: £6.1 million) at a margin of 20.2% (2020: 20.3%). Second half adjusted EBITDA of £4.7m (margin 24.9%) was 147% up on that achieved in the first half of the year and 79% up on the second half of the previous year.

Exceptional costs of £1.3 million (2020: £0.2 million) significantly increased due to the incurrence of legal and professional fees plus stamp duty and warranty insurance associated with the completion of the acquisition of BBI Healthcare (acquired on 4 June 2021) and to a much lesser extent, the Helsinn brands (acquired on 6 August 2021), as well as subsequent integration costs post completion.

Operating profit was £1.4 million (2020: £3.6 million) with the profit before tax for the Group of £0.9 million (2020: £3.3 million). The decline in operating profit compared to the growth in adjusted EBITDA is as a result of higher amortisation and depreciation charges plus the significant increase in exceptional costs as outlined above.

The Group reported profit after tax of £2.4 million (2020: profit of £2.4 million). Finance costs were £0.5 million (2020: £0.3 million) and comprised interest payable on the portfolio of euro loans up until closure, coupled with interest on the Group's new revolving credit facility entered in June 2021.

These translated into adjusted earnings per share (defined as earnings per share before amortisation, share based payments and exceptional items) of 4.94 pence (2020: 4.46 pence), with the improvement in business performance generating enhanced shareholder value. The number of shares in issue as at 31 December 2021 was 125,831,530. (31 December 2020: 125,831,530) and the weighted average number during 2021 was 125,831,530 (2019: 86,402,007).

The ongoing growth of the business and strong levels of Q4 customer billing resulted in a negative flux to working capital in the amount of £3.2 million (2020: £3.3) million). Cash generated from operations was £2.0 million (2020: £3.7 million). Cash used in investing activities amounted to £39.2 million (2020: £7.5 million) and comprised the purchase consideration for the acquisition of BBI Healthcare of £35.9 million and Helsinn Healthcare £2.4m, £2.9 million of capital investment into the manufacturing facilities in Italy and Sweden, plus £0.4 million of capitalised development costs. Net cash from financing activities was £1.5 million (2020: £36.2 million) and comprised the drawdown of interest bearing borrowings from the Group's new revolving credit facility, less repayments which included the settlement of euro loans in Italy. Overall cash and cash equivalents reduced during the year by £36.9million (2020 an increase of £31.4 million).

Statement of Financial Position

Non-current assets including goodwill increased by £43.1 million during the year to £77.2 million.

Intangible non-current assets increased by £38.1 million in the year and comprised the acquisition of BBI Healthcare (£36.0 million) and the Helsinn Healthcare assets (£5.0 million) plus capitalised development costs of £0.5 million, partially offset by ongoing amortisation and FX losses arising as a result of retranslating intangible assets of the foreign operations at the closing spot rate. Capitalised development costs are carried in the amount of £1.9 million (2020: £2.0 million) and reflect workflows related to assisting our customers with formulation upgrades and changes to the Medical Device regulations.

Property, plant and equipment increased by £2.7 million being the investment in factory equipment of £1.2 million as part of the Biokosmes expansion programme, plus the new production facility and machinery in Gnesta which were acquired with BBI Healthcare £1.5 million, offset by ongoing depreciation and FX losses on euro denominated assets.

Inventory increased by 1.5% versus 2020, which includes inventory from the acquisition of BBI Healthcare (£1.2 million) which was offset by the expected favourable flux from unwinding of raw materials and finished goods in the UK and Italy following the stock build in the previous year as part of the Group's contingency plan fro BREXIT and Covid-19. Trade receivables increased to £10.7 million (2020: £6.7 million) reflecting strong Q4 billing which included the full impact of new acquisitions. Trade payables grew 7.6% again driven by the impact of new acquisitions.

Cash and debt

Cash and cash equivalents at the year-end totalled £5.2 million (2020: £42.1 million) with significant funds used during the year for investing activities. Net cash outflow during 2021 amounted to £36.9 million with the decrease in cash balances accounted for as follows:

· Operating cash flow before tax and movements in working capital - inflow of £5.1 million

· Changes in working capital driven by debtor build post acquisition - outflow of £3.2 million

· Tax payments - outflow of £1.4 million

· Acquisition of BBIH and HICP - outflow of £35.9 million (excluding PPE)

· Investment in PPE (£0.4 million), intangible development assets (£0.5 million) and intangibles acquired through business combination (£2.4 million) - outflow of £3.3 million

· Drawdown of Financing (£16.3 million) less repayments and Finance lease repayments (£14.8 million) - inflow of £1.5 million

Cash flow and net cash

	2021	2020
	£'000	£'000
Operating cash flow before movements in working capital	5,135	6,704
Change in working capital	(3,179)	(3,052)
Cash generated from operations	1,956	3,652
Income taxes paid	(1,355)	(896)
Net cash from operating activities	601	2,756
Cash outflow from investing activities - acquisitions	(35,917)	(5,465)
Cash outflow from investing activities - additions	(3,262)	(2,069)
Cash inflow from financing activities - equity raise	-	35,040
Cash inflow from financing activities - other financing	1,502	1,181
Increase in cash and cash equivalents	(37,076)	31,443
Cash and cash equivalents at beginning of year	42,095	10,710
Effect of foreign exchange rates	216	(58)
Cash and cash equivalents at end of year	5,235	42,095

Net debt, excluding finance lease obligations was £3.2m as at 31 December 2021 (2020: Net cash £35.5 million). The Group is financed by a revolving credit facility, secured against the assets and profits of most subsidiaries within the group and with expiry in June 2024. This facility was established during 2021 in the committed sum of £30.0 million of which £4.0 million and €6.0 million has been drawn at 31st December 2021. The revolving credit facility bears interest at a fixed rate of 2.5% plus SONIA on drawn funds as well as commitment interest at the rate of 1.0% plus SONIA on the balance of undrawn funds up to the facility limit.

The balance sheet remains strong and the Group has access to low cost debt finance to progress the development of its business, continue to invest in its manufacturing capability and further deliver on its acquisition strategy. The Directors have prepared detailed forecasts looking beyond 12 months from the date of these financial statements which have been stress tested and show that the Group can continue to operate profitably in the foreseeable future with positive cashflow generation. The Directors therefore conclude that the Going Concern basis remains the appropriate basis upon which to prepare the Group's financial statements.

Against a challenging backdrop from global supply chain pressures and the Covid-19 pandemic, 2021 has been an important year for the business which saw the Group deliver another year of revenue and profit growth as well as the successful integration of two acquisitions including its largest ever acquisition in that of BBI Healtchare. Whilst the current level of supply chain disruption is unprecedented and creates uncertainty, the Group looks forward to the year ahead with a greater platform established from a wider product portfolio, additional manufacturing capability and a strengthened operating team. The momentum in the second half of the year is a strong indicator of the run-rate from the newly enlarged Group, reflecting the full year impact of acquisitions and cost synergies realised.

Daniel Wells

Chief Financial Officer

16 May 2022

Consolidated Statement of Comprehensive Income

for the year ended 31 December 2021

Company number 05651130

		Year ended	Year ended
		31 December	31 December
		2021	2020
	Notes	£'000	£'000

Revenue	2	32,762	30,076
Cost of sales		(19,804)	(17,229)
Gross profit		12,958	12,847
Administrative expenses
Operating expenses		(8,441)	(7,980)
Impairment losses of financial assets		134	(405)
Amortisation of intangible assets		(2,287)	(909)
Total administrative expenses		(10,594)	(9,294)
Other income		338	169
Operating profit before exceptional items		2,702	3,722
Exceptional costs	3	(1,331)	(167)
Operating profit		1,371	3,555
Finance income		89	54
Finance costs		(514)	(333)
Profit before tax		946	3,276
Tax	4	1,456	(908)
Profit for the year		2,402	2,368
Other comprehensive income:
Items that will be reclassified subsequently to profit or loss
Foreign exchange gain / (loss) on translation of subsidiaries		(1,543)	1,284
Total comprehensive profit for the year attributable to equity holders of the parent		859	3,652

All of the profit and the total comprehensive income for the year is attributable to equity holders of the parent.

		Year ended	Year ended
		31 December	31 December
		2021	2020
Profit per share
Basic profit per share (pence)	5	1.91	2.74
Diluted profit per share (pence)	5	1.79	2.53

Consolidated Statement of Financial Position

at 31 December 2021

Company number 05651130

		At 31 December	At 31 December
		2021	2020
	Notes	£'000	£'000

Assets
Non-current assets
Intangible assets	7,8	65,079	27,024
Property, plant and equipment		9,737	7,018
Deferred Tax		2,349	-
		77,165	34,042

Current assets
Inventories		9,019	8,886
Trade and other receivables		12,212	7,653
Cash and cash equivalents	9	5,235	42,095
		26,466	58,634
Total assets		103,631	92,676

Equity and liabilities
Capital and reserves
Share capital	10	377	377
Share premium account	10	65,738	65,738
Merger reserve	10	7,656	7,656
Foreign currency translation reserve		(114)	1,429
Share-based payments reserve		856	660
Retained earnings		(1,349)	(3,751)
Total equity attributable to equity holders of the parent		73,164	72,109

Liabilities
Current liabilities
Trade and other payables		9,717	7,108
Taxation		188	433
Interest-bearing borrowings	11	620	2,457
		10,525	9,998
Non-current liabilities
Interest-bearing borrowings	11	12,109	8,721
Statutory employment provision		1,236	1,201
Deferred tax liability		6,597	647
		19,942	10,569
Total liabilities		30,467	20,567
Total equity and liabilities		103,631	92,676

Consolidated Statement of Changes in Equity

for the year ended 31 December 2021

				Foreign
		Share		currency	Share-based
	Share	Premium	Merger	translation	Payments	Retained	Total
	Capital	account	reserve	reserve	Reserve	earnings	Equity
	£'000	£'000	£'000	£'000	£'000	£'000	£'000

Balance at 1 January 2020	251	30,824	7,656	145	624	(6,492)	33,008
Profit for the year	-	-	-	-	-	2,368	2,368
Foreign exchange
on translation	-	-	-	1,284	-	-	1,284
Total comprehensive income	-	-	-	1,284	-	2,368	3,652
Share-based payments charge	-	-	-	-	409	-	409
Share-based payments charge recycling	-	-	-	-	(373)	373	-
Contributions of equity, net of transaction costs	126	34,914	-	-	-	-	35,040
Transactions with
Shareholders	126	34,914	-	-	36	373	35,449
Balance at
1 January 2021	377	65,738	7,656	1,429	660	(3,751)	72,109
Profit for the year	-	-	-	-	-	2,402	2,402
Foreign exchange
on translation	-	-	-	(1,543)	-	-	(1,543)
Total comprehensive income	-	-	-	(1,543)	-	2,402	859
Share-based payments charge	-	-	-	-	196	-	196
Share options charge
Recycling	-	-	-	-	-	-	-
Transactions with
Shareholders	-	-	-	-	196	-	196
Balance at
31 December 2021	377	65,738	7,656	(114)	856	(1,349)	73,164

As at 31st December 2021 the parent entity has lacked distributable reserves and is accordingly not in a position to declare any dividend.

Consolidated Statement of Cash Flows

for the year ended 31 December 2021

	Year ended	Year ended
	31 December	31 December
	2021	2020
	£'000	£'000
Cash flow from operating activities
Profit before tax	946	3,276
Finance (income)/expense	425	279
Operating profit	1,371	3,555
Adjustments for:
- Depreciation of property, plant and equipment	1,415	1,081
- Impairment losses of financial assets	(134)	405
- Amortisation of intangible assets	2,287	909
- Loss on disposal of non-current assets	-	345
- Share-based payment expense	196	409
Operating cash flow before movements in working capital	5,135	6,704
(Increase) / decrease in inventories	718	(3,294)
(Increase) in trade and other receivables	(2,989)	(1,161)
Increase / (decrease) in trade and other payables	(908)	1,403
Cash generated from operations	1,956	3,652
- Tax paid	(1,472)	(896)
- Tax receipt	117	-
Net cash from operating activities	601	2,756
Cash flow from investing activities:
Acquisition of subsidiaries, net of cash acquired	(35,917)	(5,465)
Purchases of property, plant and equipment	(371)	(1,248)
Expenditure in respect of intangible assets	(2,891)	(821)
Net cash used in investing activities	(39,179)	(7,534)
Cash flow from financing activities:
Proceeds from issuance of ordinary shares	-	36,997
Transaction costs incurred from issue of ordinary shares	-	(1,957)
Drawdown of interest-bearing borrowings	16,336	5,428
Repayment of interest-bearing borrowings	(13,614)	(3,433)
Leasing obligation repayments	(728)	(764)
Interest paid	(492)	(50)
Net cash from financing activities	1,502	36,221
Net increase in cash and cash equivalents	(37,076)	31,443
Net foreign exchange difference	216	(58)
Cash and cash equivalents at beginning of period	42,095	10,710
Cash and cash equivalents at end of period	5,235	42,095

Notes to the Consolidated Statements

for the year ended 31 December 2021

1. Basis of the announcement

The ﬁnancial information of the Group set out above does not constitute statutory accounts for the purposes of Section 435 of the Companies Act 2006. The ﬁnancial information for the year ended 31 December 2021 has been extracted from the Group's audited ﬁnancial statements which were approved by the Board of directors on 16 May 2022 and delivered to the Registrar of Companies for England and Wales following the Company's 2021 Annual General Meeting.

The ﬁnancial information for the year ended 31 December 2021 has been extracted from the Group's ﬁnancial statements for that period. The report of the auditor on the 2021 ﬁnancial statements was unmodified, did not include any references to any matters to which the auditors drew attention by way of emphasis without qualifying their report and did not contain a statement under Section 498(2) or Section 498(3) of the Companies Act 2006.

On 31 December 2020, IFRS as adopted by the European Union at that date was brought into UK law and became UK adopted international accounting standards, with future changes being subject to endorsement by the UK Endorsement Board. The Group transitioned to UK adopted international accounting standards in its consolidated financial statements on 1 January 2021. There was no impact or changes in accounting policies from the transition.

Whilst the ﬁnancial information included in this preliminary announcement has been prepared in accordance with UK adopted international accounting standards, in conformity with the requirements of the Companies Act 2006, that are relevant to companies that report under these standards, this announcement does not itself contain suﬃcient information to comply with those standards. This ﬁnancial information has been prepared in accordance with the accounting policies set out in the 2021 Report and Accounts and updated for new standards adopted in the current year.

Items included in the ﬁnancial information of each of the Group's entities are measured using the currency of the primary economic environment in which the entity operates (the functional currency). The consolidated ﬁnancial information is presented in UK sterling (£), which is the Group's presentational currency.

The Company is a public limited company incorporated and domiciled in England & Wales and whose shares are quoted on AIM, a market operated by The London Stock Exchange.

The principal activity of Venture Life Group plc and its subsidiaries is the development and commercialisation of healthcare products, including food supplements, medical devices and dermo-cosmetics for the ageing population, and the manufacture of a range of topical products for the healthcare and cosmetics.

2.1 Segment revenue and results

The following is an analysis of the Group's revenue and results by reportable segment:

	Venture
	Life	Customer	Consolidated
	Brands	Brands	Group
	£'000	£'000	£'000
Year ended 31 December 2021
Revenue
Sale of goods	17,972	19,047	37,019
Sale of services	-	-	-
Intercompany sales elimination	-	(4,257)	(4,257)
Total external revenue	17,972	14,790	32,762
Results
Operating profit before exceptional items and excluding central administrative costs	4,255	1,812	6,067

Year ended 31 December 2020
Revenue
Sale of goods	14,910	20,854	35,764
Sale of services	-	672	672
Intercompany sales elimination	-	(6,360)	(6,360)
Total external revenue	14,910	15,166	30,076
Results
Operating profit before exceptional items and excluding central administrative costs	4,551	3,060	7,611

All revenue of the Group is recognised at a point in time with the exception of the supply of services which is recognised over time in accordance with IFRS 15.

The reconciliation of segmental operating profit to the Group's profit before tax is as follows:

	Year ended	Year ended
	31 December	31 December
	2021	2020
	£'000	£'000
Operating profit before exceptional items and excluding central administrative costs	6,067	7,611
Exceptional items	(1,331)	(167)
Central administrative costs	(3,365)	(3,889)
Finance income / (costs)	(425)	(279)
Profit before tax	946	3,276

One customer generated revenue of £4,383,290 which accounted for 10% or more of total revenue (2020: one customer generated revenue of £5,449,000 which accounted for 10% or more of total revenue).

2.2 Segmental assets and liabilities

	At	At
	31 December	31 December
	2021	2020
	£'000	£'000
Assets
Venture Life Brands	71,785	22,695
Customer Brands	28,783	31,379
Central Group assets	3,063	38,602
Consolidated total assets	103,631	92,676
Liabilities
Venture Life Brands	13,500	7,685
Customer Brands	10,976	12,176
Central Group liabilities	5,991	706
Consolidated total liabilities	30,467	20,567

2.3 Other segmental information

	Depreciation	Addition to
	and	non-current
	Amortisation	Assets
	£'000	£'000
Year ended 31 December 2021
Venture Life Brands	2,868	44,038
Customer Brands	445	564
Central administration	389	-
	3,702	44,602
Year ended 31 December 2020
Venture Life Brands	129	5,465
Customer Brands	1,471	2,069
Central administration	390	-
	1,990	7,534

2.4 Geographical information

The Group's revenue from external customers by geographical location of customer is detailed below:

	Year ended	Year ended
	31 December	31 December
	2021	2020
	£'000	£'000
Revenue
UK	15,888	11,135
Italy	8,882	9,801
Switzerland	1,842	2,638
Germany	951	1,352
Netherlands	658	1,185
Rest of Europe	2,904	1,234
China	273	2,329
Rest of the World	1,364	402
Total revenue	32,762	30,076

3. Exceptional items

	Year ended	Year ended
	31 December	31 December
	2021	2020
	£'000	£'000
Costs incurred in the acquisition of BBI Healthcare Ltd and Helsinn brands	964	77
Costs incurred in the acquisition of the PharmaSource BV business (completed 24 January 2020)	-	90
Integration of acquisitions	261	-
Other	106	-
Total exceptional items	1,331	167

During the period the Group incurred legal and professional fees in relation to the acquisition of BBI Healthcare Ltd, which was completed during the year as well as the acquisition of a basket of brands from Helsinn Pharma as well as further works in relation to prospective acquisitions.

4. Income tax expense

	Year ended	Year ended
	31 December	31 December
	2021	2020
	£'000	£'000
Current tax:
Current tax on profits for the year	665	1,184
Adjustments in respect of earlier years	99	(209)
Total current tax expense	764	975
Deferred tax:
Origination and reversal of temporary differences	(2,220)	(67)
Total deferred tax credit	(2,220)	(67)
Total income tax credit	(1,456)	908

Tax on the Group's profit/(loss) before tax differs from the theoretical amount that would arise using the weighted average tax rate applicable to profits and losses of the consolidated entities as follows:

	Year ended	Year ended
	31 December	31 December
	2021	2020
	£'000	£'000
Profit before tax	946	3,276
Profit before taxation multiplied by the local tax rate of 19% (2019: 19%)	180	622
Expenses not deductible for tax purposes	15	118
Change in recognised deferred tax liability	51	-
Change in unrecognised deferred tax asset	(2,183)	103
Current year losses for which no deferred tax asset has been recognised	166	-
Utilised losses	(213)	-
Previously recognised deferred tax	174	-
Other adjustments	65	-
Higher rate on foreign taxes	190	65
Adjustments for current tax of prior periods	99	-
Income tax charge	(1,456)	908

In the Spring Budget 2021, the UK Government announced that from 1 April 2023 the corporation tax rate would rise from 19% to 25% on all profits in excess of £250,000. This new law was substantively enacted on 24 May 2021. The standard corporation tax rate in Italy is 24% and there is in addition a regional production tax of 3.9%. Corporation tax rates in the Netherlands are 25% on profits in excess of €200,000 and 19% on profits below this threshold. Corporation tax rates in the Sweden are 20.6%. Deferred taxes at the balance sheet date have been measured using these enacted tax rates and reflected in these financial statements.

As at the reporting date, the Group has unused tax losses of £9,038,000 (2020: £10,900,000) available for offset against future profits generated in the UK. A deferred tax asset has been recognised on the losses which the company considers will be utilised against future profits in the UK however, there remain losses of £410,000 which a deferred tax asset has not be recognised on due to the uncertainty of their recoverability.

The tax charge of the Group is mainly driven by tax paid on the profits of Biokosmes S.r.l, PharmaSource B.V, Nelie B.V. and Rolf Kullgren A.B. The group has also recognised the deferred tax asset in relation to losses carried forward in the UK entities and this has been partly offset by the release of deferred tax liabilities generated on the acquisition of the BBI Healthcare Group and the Helsinn business in the current year and Biokosmes, Periproducts and Dentyl businesses in prior years.

5. Earnings per share

	Year ended	Year ended
	31 December	31 December
	2021	2020
	Number	Number
For basic EPS calculation	125,831,530	86,402,007
For diluted EPS calculation	133,819,347	93,416,888

The dilution reflects the inclusion of the options and LTIPs that have been issued, amounting to 7,433,702 stock options and 554,115 LTIPs per Note 23.

A reconciliation of the earnings used in the different measures is given below:

	£'000	£'000
For basic and diluted EPS calculation	2,402	2,368
Add back: Amortisation	2,287	909
Add back: Exceptional costs	1,331	167
Add back: Share based Payments	196	409
For adjusted EPS calculation 1	6,216	3,853

1 Adjusted EPS is profit after tax excluding amortisation, exceptional costs and share-based payments.

The resulting EPS measures are:

	Pence	Pence
Basic EPS calculation	1.91	2.74
Diluted EPS calculation	1.79	2.53
Adjusted EPS calculation 1	4.94	4.46
Adjusted diluted EPS calculation	4.65	4.12

6. Dividends

Amounts recognised as distributions to equity holders in the period:

	Year ended	Year ended
	31 December	31 December
	2021	2020
	£'000	£'000
Final dividend	-	-

The Directors do not recommend the payment of a dividend (2020: £ nil pence per share).

7. Intangible assets

					Other
	Development		Patents and		intangible
	Costs	Brands	Trademarks	Goodwill	assets	Total
	£'000	£'000	£'000	£'000	£'000	£'000
Cost or valuation:
At 1 January 2020	3,280	1,089	1,016	16,417	2,856	24,658
Acquired through business combinations	-	-	417	4,076	1,040	5,533
Additions	739	-	82	-	-	821
Disposals	(345)	-	(182)	-	-	(527)
Foreign exchange movements	170	-	41	784	174	1,169
At 1 January 2021	3,844	1,089	1,374	21,277	4,070	31,654
Acquired through business combinations	-	19,004	-	15,177	6,870	41,051
Additions	470		43			513
Disposals	(1)		(396)			(397)
Foreign exchange movements	(264)		(42)	(971)	(213)	(1,490)
At 31 December 2021	4,049	20,093	979	35,483	10,727	71,331
Amortisation:
At 1 January 2020	1,438	-	703	-	1,603	3,744
Charge for the year	323	-	213	-	373	909
Disposals	-	-	(182)	-	-	(182)
Foreign exchange movements	76	-	6	-	77	159
At 1 January 2021	1,837	-	740	-	2,053	4,630
Charge for the year	408	822	180		877	2,287
Disposals	(1)		(396)			(397)
Foreign exchange movements	(132)		(13)		(123)	(268)
At 31 December 2021	2,112	822	511	-	2,807	6,252
Carrying amount:
At 31 December 2020	2,007	1,089	634	21,277	2,017	27,024
At 31 December 2021	1,937	19,271	468	35,483	7,920	65,079

All Capitalised development costs are amortised over their estimated useful lives, which is five years. All amortisation has been charged to administrative expenses in the Statement of Comprehensive Income.

All trademark, licence and patent renewals are amortised over their estimated useful lives, which is between five and ten years. All amortisation has been charged to administrative expenses in the Statement of Comprehensive Income.

Other intangible assets currently comprise customer relationships and product formulations acquired through the acquisition of Biokosmes Srl. and customer relationships acquired through the acquisitions of Periproducts, the Dentyl brand, the Pharmasource group, BBI Healthcare Ltd and the Helsinn Brands. These assets were recognised at their fair value at the date of acquisition and were being amortised over a period of between five and ten years. The weighted average remaining amortisation period for other intangible assets is 7.1 years (2020: 4.9 years)

Assets with indefinite economic lives as well as associated assets with finite economic lives are tested for impairment at least annually or more frequently if there are indicators that amounts might be impaired. The impairment review involves determining the recoverable amount of the relevant cash-generating unit, which corresponds to the higher of the fair value less costs to sell or its value in use.

The key assumptions used in relation to the Biokosmes (Customer Brands comprising one CGU), Periproducts, the Dentyl brand, Pharmasource group, BBI Healthcare Ltd and the Helsinn brands (part of the Venture Life Brands comprising five CGU's) impairment review are as follows:

• The estimates of profit before tax for the three years to 31 December 2024 are based on management forecasts of the Biokosmes, Periproducts, the Dentyl brand, the Pharmasource group, BBI Healthcare Ltd and the Helsinn brand businesses, with subsequent years growth forecasted at CAGR's of 6.2%, 13.9%, 20.5%, 2.1%, 15.3% and 4.3% respectively. Management have applied risk adjustments to the forecasts and consider these to be conservative growth rates for these businesses which are reflective of the operating sectors. During the year a new partner was secured for the Chinese market and for new agreements were secured with other international partners which have a material uplift impact on the future sales forecast for Periproducts Ltd, the Dentyl brands and BBI Healthcare Ltd.

· During 2021, Biokosmes net sales growth was negative 3% due the acquisition of HelsinnHealthcare assets which is accounted for in separate parts of the Group post acquisition (on a like for like basis net sales growth was 2%), Periproduct's main asset (UltraDEX) net sales declined by 20% due to the termination of the previous Chinese partner, Dentyl brand grew by 3%, the Pharmsource group net sales remained flat, BBI healthcare Ltd net sales grew by 8.4% and the sales of Helsinn brands grew by 10.8%.

• The Group has applied a discount rate to the future cash flows of Biokosmes for five years, with a terminal value reflecting future years. The rate is based upon the Group WACC of 12.6% and adjusted for specific segment, country and currency risk and then converted onto a pre-tax basis to derive a rate of 19.0%. These assumptions generate a significant headroom of £4.2m over the assets of the business held at the balance sheet date. The Biokosmes factory has remained open throughout 2021 and in the current year-to-date and has not been impacted by Covid-19. Sensitivity analysis has been performed by increasing the pre-tax WACC by 0.5ppt which shows that headroom remains.

· The Group has applied a discount rate to the future cash flows of Periproducts Ltd for five years including a terminal value. The rate is based upon the Group WACC of 12.6% and adjusted for specific segment, country and currency risk and then converted onto a pre-tax basis to derive a rate of 16.6%. These assumptions generate comfortable headroom over the assets of the business held at the balance sheet date. The impairment assessment of Periproducts Ltd includes a material uplift from the inclusion of the newly secured Chinese partner which has been risk adjusted by 50%. Sensitivity analysis has been performed by increasing the pre-tax WACC by 0.5ppt which shows that headroom remains.

· The Group has applied a discount rate to the future cash flows of the Dentyl brand for five years including a terminal value. The rate is based upon the Group WACC of 12.6% and adjusted for specific segment, country and currency risk and then converted onto a pre-tax basis to derive a rate of 16.0%. These assumptions generate comfortable headroom of £0.9m over the assets of the business held at the balance sheet date. The impairment assessment of the Dentyl brand includes a material uplift from the inclusion of the newly secured Chinese partner which has been risk adjusted by 50%. Sensitivity analysis has been performed by increasing the pre-tax WACC by 0.5ppt which shows that headroom remains.

• The Group has applied a discount rate to the future cash flows of the Pharmasource group for five years including a terminal value. The rate is based upon the Group WACC of 12.6% and adjusted for specific segment, country and currency risk and then converted onto a pre-tax basis to derive a rate of 12.9%. These assumptions generate comfortable headroom of £2.2m over the assets of the business held at the balance sheet date. Sensitivity analysis has been performed by increasing the pre-tax WACC by 0.5ppt which shows that headroom remains.

· The Group has applied a discount rate to the future cash flows of BBI Healthcare Ltd for five years including a terminal value. The rate is based upon the Group WACC of 12.6% and adjusted for specific segment, country and currency risk and then converted onto a pre-tax basis to derive a rate of 15.4%. These assumptions generate a headroom of £1.2m over the assets of the business held at the balance sheet date. The impairment assessment of BBI Healthcare Ltd includes a material uplift from new customer agreements secured during the year which have been risk adjusted by 25%. Sensitivity analysis has been performed by increasing the pre-tax WACC by 0.5ppt which shows that headroom remains.

· The Group has applied a discount rate to the future cash flows of the Helsinn brands for five years including a terminal value. The rate is based upon the Group WACC of 12.6% and adjusted for specific segment, country and currency risk and then converted onto a pre-tax basis to derive a rate of 16.6%. These assumptions generate comfortable headroom of £1.5m over the assets of the business held at the balance sheet date. Sensitivity analysis has been performed by increasing the pre-tax WACC by 0.5ppt which shows that headroom remains.

· The above impairment assessments of Biokosmes SRL, Periproducts Ltd, the Dentyl brand, the Pharmasource group, BBI Healthcare Ltd and the Helsinn brands have included assessment of all elements of intangible value regardless of whether their economic lives are finite or indefinite, and include Customer Relationships, acquired formulations, acquired Trademarks and Goodwill.

Intangible assets with indefinite useful lives allocated to operating segments



		Year ended 31 December 2021	Year ended 31 December 2020
		£'000	£'000


Goodwill	PeriProducts Ltd	3,337	3,337
	Dentyl	3,100	3,100
	Pharmasource BV	4,057	4,340
	BBI Healthcare Ltd	13,252	-
	The Helsinn brands	1,925	-
	Venture Life Brands Total	25,671	10,777

	Biokosmes srl	9,812	10,500
	BBI Healthcare Ltd	-	-
	Customer Brands Total	9,812	10,500

	Total	35,483	21,277

Brands	PeriProducts Ltd	-	-
	Dentyl	1,089	1,089
	Pharmasource BV	-	-
	BBI Healthcare Ltd		-
	The Helsinn brands	2,010	-
	Venture Life Brands Total	3,099	1,089

	Biokosmes srl	-	-
	BBI Healthcare Ltd	-	-
	Customer Brands Total	-	-

	Total	3,099	1,089

The recoverable amount of each segment was determined based on value-in-use calculations, covering a detailed three-year forecast, followed by an extrapolation of expected cash flows for the remaining useful lives using a declining growth rate determined by management. The present value of the expected cash flows of each segment is determined by applying a suitable discount rate reflecting current market assessments of the time value of money and risks specific to the segment.



	Year ended 31 December 2021	Year ended 31 December 2020
	£'000	£'000
PeriProducts Ltd	5,958	6,290
DentylDentyl	5,262	5,930
Pharmasource BV	7,332	8,659
BBI Healthcare Ltd	36,981	-
The Helsinn brands	6,433	-
Venture Life Brands Total	61,966	20,879

Biokosmes srl	14,435	13,691
Customer Brands	14,435	13,691

These assumptions are subjective and provide key sources of estimation uncertainty, specifically in relation to growth assumptions, future cashflows and the determination of discount rates. The actual results may vary and accordingly may cause adjustments to the Group's valuation in future financial years. Sensitivity analysis has been performed on the impairment review and indicate sufficient headroom in the event of reasonably possible changes in key assumptions are unlikely to result in an impairment for intangibles.

8a. Business combinations

On 4th June 2021 the Company completed the acquisition of 100% of the equity of BBI Healthcare Ltd and wholly-owned subsidiaries Rolf Kullgren AB, BBI Healthcare Holdings AB and Kullgren Holdings AB, a group of companies based in the UK and Sweden engaged in the supply of women's health and energy management related products to global customers and trading under the name of "BBI Healthcare". The acquisition consideration was £37.1 million, comprising £3.1 million net working capital at completion, £22.8 million in intangible assets (principally customer relationships, distribution agreements and Trademarks), £3.6 million tangible fixed assets (principally building and machinery in Sweden), £5.4 million deferred tax provision and a balance of £13.7 million as goodwill. The magnitude of the goodwill reflects the future value that the Group can unlock from this business acquisition through (a.) the trading of these acquired products into its network of existing Venture Life Brand customers, (b.) value creation through the application of the Group' internal R&D resources to broaden the product range. The acquisition consideration of £37.1m million was paid in cash at completion. The acquisition was funded through the Company's equity raise in 2020.

The acquisition of BBI Healthcare introduces additional strong brands and products into the Group and customers in the areas of women's intimate health and diabetes support. The Group acquired the business to further strengthen the product portfolio and pursue opportunities within existing and new global markets. The inclusion of this additional business into its portfolio increased the leverage of its trading infrastructure and contributed to the overall improvement in profitability. The acquisition has been accounted for under IFRS 3 as a business combination. The Consolidated Financial Statements to 2021 include the results of the BBI Healthcare business for the period from 4^th June 2021 to 31^st December 2021.

The fair values of the identifiable assets and liabilities of the BBI Healthcare business as at the date of acquisition were:

Acquisition of BBI Healthcare Ltd on 4th June 2021	Book value	Fair Value Adjustments	Fair Value
	£'000s	£'000s	£'000s
Assets
Non - current assets	8,099	18,320	26,419
Licenses, Trademarks, Intellectual Property, Capitalised development	696	(696)
Goodwill (within BBI Healthcare Ltd)	4,399	(4,399)
Brands *	-	16,994	16,994
Distribution Agreements *	-	5,788	5,788
Tangible Fixed Assets	2,977	633	3,610
Deferred Tax Asset	27	-	27
Current Assets	4,088	-	4,088
Inventories	1,293	-	1,293
Trade Receivables	1,374	-	1,374
Other Receivables	213	-	213
Cash	1,208		1,208
Total assets	12,187	18,320	30,507

Current liabilities	(1,021)	-	(1,021)
Trade payables	(946)	-	(946)
Other payables	(75)	-	(75)
Non-current liabilities	(9,676)	4,063	(5,613)
Borrowings	(9,676)	9,676	-
D eferre d tax		(5,613)	(5,613)
Total net assets	1,490	22,383	23,873

Net Assets acquired			23,873
Goodwill			13,252
Total consideration			37,125

* Intangible assets identified as part of the BBI Healthcare acquisition.

BBI Healthcare was acquired on 4 June 2021. It generated net revenues of £6.5 million and adjusted EBITDA of £2.1 million in the period from acquisiton to 31 December 2021.

8b. Business combinations

On 6th August 2021 the Company completed the acquisition of a basket of brands from Helsinn Pharma, a company based in Switzerland engaged in the supply of oncology related products to European customers and trading under the name of "Helsinn". The acquisition consideration was £4.8 million, comprising £3.1 million in intangible assets (principally customer relationships, distribution agreements and Trademarks), £0.3 million deferred tax provision and a balance of £2.0 million as goodwill. The magnitude of the goodwill reflects the future value that the Group can unlock from this business acquisition through (a.) the trading of these acquired products into its network of existing Venture Life Brand customers, (b.) value creation through the transitioning of manufacturing in-house and (c.) value creation through the application of the Group' internal R&D resources to broaden the product range. The acquisition consideration of £4.8 million was paid in cash of £2.4 million at completion and the balance of £2.4 million at twelve months after completion. The acquisition was funded through the Company's RCF.

The Helsinn brands acquisition expands the company product portfolio into oncology support and further broadens its customer base, especially across Europe. The Group acquired the brands to further strengthen the product portfolio and pursue identified expansion opportunities in key markets across Europe, USA and Asia. The inclusion of this additional business into its portfolio increased the leverage of its trading infrastructure and contributed to the overall improvement in profitability. The acquisition has been accounted for under IFRS 3 as a business combination. The Consolidated Financial Statements to 2021 include the results of the Helsinn brands for the period from 6^th August 2021 to 31^st December 2021.

The fair values of the identifiable assets and liabilities of the Helsinn business as at the date of acquisition were:

	Fair Value CHF'000	Fair Value £'000
Assets
Non-current Assets
Customer Relationships *	1,365	1,082
Brands *	2,536	2,010
Non-current liabilities
Deferred taxation	(329)	(261)
Total Net Assets	3,572	2,831
Net Assets acquired	3,572	2,831
Goodwill	2,428	1,925
Total Consideration	6,000	4,756

Satisfied by
Cash paid at completion	3,000	2,378
Cash to be paid 365 days from completion	3,000	2,378
Total Consideration	6,000	4,756

* Intangible assets identified as part of the Helsinn acquisition.

The Helsinn business was acquired on 6 August 2021. It generated net revenues of £1.9 million in the period from acquisiton to 31 December 2021.

9. Cash and cash equivalents

	At	At
	31 December	31 December
	2021	2020
	£'000	£'000
Available Cash and cash equivalents	5,235	42,095

The Group holds sterling, Chinese renminbi and euro denominated balances in the UK. The Group's subsidiaries hold US dollar, yen and euro accounts in Italy, euro accounts in the Netherlands, a Swiss franc account in Switzerland and Swedish Krona account in Sweden.

The Directors consider that the carrying value of cash and cash equivalents approximates their fair value.

10. Share capital and share premium

All shares are authorised, issued and fully paid. The Group has one class of ordinary shares which have full voting rights, no preferences and no restrictions attached.	Ordinary	Ordinary
	shares of	shares of	Share	Merger
	0.3p each	0.3p each	premium	Reserve
	Number	£	£'000	£'000
At 31 December 2021	125,831,530	377,495	65,738	7,656
At 31 December 2020	125,831,530	377,495	65,738	7,656

The Company issued no new shares during 2021. (42,119,424 new shares were issued during 2020 for consideration of £36,997,000).

The Group operates a Long-Term Incentive Plan. Up to the balance sheet date, there have been four awards under this plan, in which Executive Directors and senior management of the Group participate. During 2021, one of the awards matured and met the vesting conditions.

11. Interest-bearing borrowings

	At	At
	31 December	31 December
	2021	2020
	£'000	£'000
Current
Invoice financing	-	888
Leasing obligations	620	477
Unsecured bank loans due within one year	-	1,092
Total	620	2,457
Non-current
Leasing obligations	3,626	4,085
Unsecured bank loans due after one year	-	4,636
Secured bank loans due after one year	8,483	-
Total	12,109	8,721

All bank loans are held jointly by Santander Bank and Silicon Valley Bank and comprise the Group's revolving credit facility, secured against the assets and profits of most subsidiaries within the group and with expiry in June 2024. This facility was established during 2021 in the committed sum of £30.0 million of which £4.0 million and €6.0 million has been drawn at 31st December 2021. (The prior year borrowing comprised loans from several Italian banks which were all repaid in full during 2021 pursuant to the revolving credit facility). Invoice financing includes the Italian RiBa (or "Ricevuta Bancaria") facility which is a short-term facility. The balance shown above of £nil (2020: £888,000) reflects the amount that had been settled in Biokosmes' account under RiBa and drawn against invoices in the UK as at the reporting date.

The revolving credit facility bears interest at a fixed rate of 2.5% plus SONIA on drawn funds as well as commitment interest at the rate of 1.0% plus SONIA on the balance of undrawn funds up to the facility limit. The RiBa invoice financing balance bears interest at variable rates.

A summary showing the utilisation of the revolving credit facility shown below:

	2021 GBP £'000	2021 EUR £'000	2021 All £'000	2020 GBP £'000	2020 EUR £'000	2020 All £'000
Opening Balance at 1^st January	-	-	-	-	-	-
Drawdown	9,500	5,884	15,384	-	-	-
Repayments	(5,500)	(818)	(6,318)	-	-	-
Impact of foreign exchange	-	(27)	(27)	-	-	-
Closing Balance at 31^st December	4,000	5,039	9,039	-	-	-

A summary showing the utilisation of the RIBa invoice financing is shown below:

	2021 £'000	2020 £'000
Opening Balance at 1^st January	888	1,184
Drawdown	953	2,314
Repayments	(1,804)	(2,668)
Impact of foreign exchange	(37)	58
Closing Balance at 31^st December	-	888

A summary showing the contractual repayment of interest-bearing borrowings is shown below:

		At 31 December 2021			At 31 December 2020
	Leasing			Leasing
	obligations	Other	2021	obligations	Other	2020
	£'000	£'000	£'000	£'000	£'000	£'000
Amounts and timing of debt repayable
Within 1 year	660	433	1,093	523	2,052	2,575
1-2 years	633	435	1,068	473	1,508	1,981
2-3 years	419	9,284	9,703	447	1,352	1,799
3-4 years	418	-	418	448	1,167	1,615
4-5 years	410	-	410	447	638	1,085
After more than 5 years	1,899	-	1,899	2,471	90	2,561
Total	4,439	10,152	14,591	4,809	6,807	11,616

The above amounts reflect the contractual undiscounted cash flows, which may differ to the carrying values of the liabilities at the reporting date.

Net debt reconciliation

	Liabilities from Financing activities			Other assets
					Net Cash /
	Borrowings	Leases	Sub-Total	Cash	(Net Debt)
Net cash at 01 January 2020	4,374	2,651	7,025	10,710	3,685
Net cashflow	-	-	-	31,443	31,443
Finance lease repayments	-	(764)	(764)	-	764
Interest on Leases	-	33	33	-	(33)
Drawdown	5,428	2,510	7,938	-	(7,938)
(Repayments)	(3,433)	-	(3,433)	-	3,433
Foreign exchange movements	247	132	379	(58)	(437)
Net cash at 31 December 2020	6,616	4,562	11,178	42,095	30,917
Net cashflow	-	-	-	(37,076)	(37,076)
Finance lease repayments	-	(728)	(728)	-	728
Fees and interest	(556)	-	(556)	-	556
Drawdown	16,336	733	17,069	-	(17,069)
(Repayments)	(13,614)	-	(13,614)	-	13,614
Foreign exchange movements	(299)	(321)	(620)	216	836
Net cash at 31 December 2021	8,483	4,246	12,729	5,235	(7,494)

Lease liability

In 2017 the Group adopted IFRS 16 which means that lease contracts that have previously been recognised as operating leases are now being recognised as finance leases. In the Statements of Financial Position additional lease liabilities at 31 December 2021 of £4,246,000 (2020: £4,562,000) and right-of-use assets of £4,239,000 (2020: £4,520,000) are recognised, giving a net liability position of £7,000 (2020: £42,000).

[1] Adjusted EBITDA is EBITDA before deduction of exceptional items and share based payments

[2] Adjusted earnings per share is profit after tax excluding amortisation, exceptional items and share-based payments

[3] Source: Nielsen, Retail Value Sales, All Outlets, MAT Dec 21 vs. Prior Year

[4] Source: Nielsen, Retail Value Sales, All Outlets, MAT Dec 21 vs. Prior Year

[5] Source: https://www.diabetes.org.uk/professionals/position-statements-reports/statistics

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