Final Results

Deltex Medical Group PLC 21 March 2006 Deltex Medical Group plc Preliminary results for the year ended 31 December 2005 21 March 2005 - Deltex Medical Group plc ('Deltex Medical' or 'Company') today announces its preliminary results for the year ended 31 December 2005. Financial Highlights â€¢ Turnover increased by 22% to Â£3,042,000 â€¢ Operating loss reduced by Â£1,274,000 to Â£1,513,000 â€¢ Cash burn rate reduced to lowest in Company's history â€¢ Gross margin improvement continues â€¢ Â£500,000 additional cash raised through the issue of new equity finance in 2005 â€¢ Sufficient cash to see Company to profitability Operating Highlights â€¢ Probe sales growth accounts for the majority of turnover increase â€¢ Continued strong sales growth (29%) in UK despite issues facing NHS â€¢ New clinical trial data further reinforces Company's value proposition â€¢ Company positioned to exploit emerging trends in global healthcare delivery â€¢ Evidence of growing interest in minimally invasive haemodynamic monitoring in USA â€¢ Company configured to reach profitability even in difficult UK market conditions Nigel Keen, Chairman of Deltex Medical, said: 'The continued growth in supportive clinical trial data and the experience of hospitals throughout the world using the CardioQ continues to reinforce the clinical and economic benefits of haemodynamic optimisation using our products. The pressures bearing down on healthcare providers, both for better quality care and reductions in cost, mean that technologies such as the CardioQ that can deliver both, will win out over those that cannot. 'CardioQ sales in the first quarter of 2006 have been encouraging and we remain confident in our ability to deliver increasing and sustainable value for our shareholders by focusing on delivering better, more cost effective care for patients undergoing major surgery or in intensive care.' For further information, please contact:- Deltex Medical Group plc 01243 774 837 Nigel Keen, Chairman Andy Hill, Chief Executive Ewan Phillips, Finance Director Financial Dynamics David Yates/John Gilbert 0207 831 3113 Notes for Editors Deltex Medical manufactures and markets the CardioQ monitor, which uses disposable ultra-sound probes inserted into the oesophagus to determine the amount of blood being pumped around the body - 'circulating blood volume'. Reduced circulating blood volume is known as hypovolaemia, which leads to insufficient oxygen being delivered to the organs. This causes medical complications including peripheral and major organ failure which can lead to death. Hypovolaemia, which is akin to severe dehydration, affects virtually every patient having surgery because of the combined effects of pre-operative starvation, the impact of the anaesthetic agents and trauma from the surgery itself. Using fluids and drugs, guided by the CardioQ, to optimise the amount of circulating blood significantly reduces post-operative complications allowing patients to make a faster, more complete recovery and return home earlier. The CardioQ incorporates the Company's proprietary software and a small diameter, easy-to-use, minimally invasive, disposable oesophageal probe that is used for transmitting and receiving an ultra-sound signal. By using this technology, the CardioQ provides clinicians with the ability to haemodynamically optimise critically ill patients and those undergoing routine moderate and major risk surgery through the controlled administration of fluid and drugs. Haemodynamic optimisation has been scientifically proven to improve the speed and quality of patient recovery and reduce hospital stay. There are already over 1,250 CardioQs currently in use in hospitals worldwide and distribution arrangements are in place in over 30 countries. In addition, there are currently more than 90 clinical publications, including eight randomised, controlled clinical trials, on the use of the CardioQ which have repeatedly:- â€¢ validated the results of the Monitor against known standards for measuring cardiac output, demonstrating that the technology works â€¢ proved that the CardioQ works in a wide range of surgical procedures â€¢ demonstrated that the Company's technology provides significant health and economic benefits by helping to reduce post-operative complications and length of hospital stays by an average of 30 to 40 per cent for a wide range of patients. Chairman's Statement Group Summary Deltex Medical's CardioQ(TM) monitor uses disposable ultrasound probes inserted into the oesophagus through the mouth or nose to determine the amount of blood being pumped around the body - 'circulating blood volume'. Reduced circulating blood volume is known as hypovolaemia and occurs as a consequence of blood loss or dehydration. If blood volume is reduced significantly, the body cannot deliver sufficient oxygen to the vital organs. This causes medical complications including peripheral and major organ failure, which can lead to death. Hypovolaemia affects almost all patients undergoing surgery because of the combined effects of pre-operative starvation, the impact of anaesthetic gases and the trauma of surgery itself. Guided by the CardioQ and using fluids and drugs to optimise the amount of circulating blood and the heart's performance, doctors can significantly reduce post-operative complications allowing patients to make a fuller, more complete recovery and return home earlier. The opportunities the CardioQ offers for improved quality and efficiency of care through helping patients get better, quicker can be summarised: the CardioQ saves lives and saves money. It is Deltex Medical's strategy to make the use of the CardioQ a standard of care in operating theatres for all patients undergoing moderate and high risk surgery as well as for its use to be the treatment of choice in Intensive Care Units for the real-time monitoring of severely ill patients. Adopting the CardioQ as a standard of care allows hospitals to both improve the quality of care they give and the efficiency with which they give it. These proven efficiency benefits allow the hospital to choose to either increase capacity, reduce costs, or redeploy existing resources to meet local priorities. Trading Results Sales 2005 2005 2005 2005 Probes Monitors Probes Monitors units units Â£'000 Â£'000 Direct markets UK 21,475 37 1,559 251 USA 4,515 12 303 50 Distributor markets Europe 6,375 50 289 328 Far East & Latin 3,685 14 128 34 America _____ _____ _____ _____ 36,050 113 2,279 663 _____ _____ _____ _____ Trading Results (continued) Sales 2005 2005 2004 2004 Other Total Probes Monitors Â£'000 Â£'000 units units Direct markets UK 88 1,898 18,082 39 USA 5 358 4,520 3 Distributor markets Europe 6 623 8,627 56 Far East & Latin 1 163 681 11 America _____ _____ _____ _____ 100 3,042 31,910 109 _____ _____ _____ _____ Trading results (continued) Sales 2004 2004 2004 2004 Probes Monitors Other Total Â£'000 Â£'000 Â£'000 Â£'000 Direct markets UK 1,254 169 53 1,476 USA 273 10 1 284 Distributor markets Europe 390 277 2 669 Far East & Latin 32 32 1 65 America _____ _____ _____ _____ 1,949 488 57 2,494 _____ _____ _____ _____ Group sales increased by 22% to Â£3,042,000 in year ended 31 December 2005 (2004: Â£2,494,000). In our largest and most developed market, the UK, Deltex Medical delivered sales growth of 29% compared to 2004 with over 80% of this growth coming from the recurring revenue streams of probe sales and monitor maintenance. Across the Group, 78% of group revenues and 68% of the sales growth came from probe sales and monitor maintenance. For the first time in the Company's history, probe sales in the UK exceeded Â£100,000 in every single month of the year. Furthermore, UK probe sales in each and every month of 2005 were ahead of the level achieved in the corresponding month in 2004. This trend has continued into the first quarter of 2006, despite the well publicised financial difficulties affecting much of the UK National Health Service (NHS). In the USA, our other directly supported market, we achieved sales growth of 26% with increases in all our revenue streams. Â£40,000 of the Â£74,000 increase in sales came from monitor sales, a clear sign that the Company's value proposition is beginning to resonate in the US market. The Company's reported sales to our distributors in Europe, the Far East and Latin America continue to be heavily influenced by the timing of larger stocking orders, with many of our distributors only placing one or two significant orders a year. This, combined with planned de-stocking programmes by our distribution partners in France and Italy, resulted in probe sales to our distributors in 2005 being Â£5,000 lower than in 2004. However, increasing numbers of our distributors, are reporting increased demand from hospitals for probes and their sales to end-users are growing. The enthusiastic uptake of our products in Peru and Korea accounts for much of the strong growth in sales in the Far East and Latin America. In addition, distributors in countries such as Brazil, China and Germany, which are at earlier stages of market development, are reporting positive developments in the early stages of market penetration. Monitor sales generated Â£663,000 for the Group, an increase of Â£175,000 over the prior year (2004: Â£488,000). Included in UK monitor sales are three SupraQs sold to the Medway Maritime Hospital in Kent (the 'Medway'). The Medway is one of our largest CardioQ accounts and, as part of the terms of trade agreed with the hospital, the doctors there will be undertaking a series of trials aimed at demonstrating the clinical efficacy of the SupraQ. In the UK Deltex Medical sold 34 CardioQ monitors in 2005, five less than in 2004, although increases in average selling prices meant that CardioQ sales in 2005 contributed Â£22,000 more revenue than in 2004. The fall in volume is due to the mounting financial difficulties facing many NHS hospitals over the last year or two and occurred despite a significant increase in the pipeline for CardioQs in the UK as clinical demand has continued to grow. In an environment of severely restricted equipment budgets in NHS hospitals, the CardioQ has to compete to secure investment more than at any stage of its history. In this environment, the CardioQ has the significant advantage of both compelling clinical trial evidence and growing real world experience which demonstrate that its implementation allows hospitals to reduce their total expenditure by material amounts. Early in 2006 Deltex Medical acquired the rights to the TECO oesophageal Doppler monitor, a device purporting to provide the same functionality as the CardioQ. We do not plan to continue to market this product and have already embarked on a programme of converting existing TECO users to the superior CardioQ. European monitor sales include 20 CardioQs purchased for use in a major multi-centre randomised controlled trial in France. This trial, which is expected to take two to three years to complete, is seeking to demonstrate a reduction in post-operative mortality in 400 patients undergoing surgery for repair of fractured neck of femur (broken hip). As it became clear in late 2004 and early 2005 that the NHS financial situation might delay conversion of large amounts of the Company's CardioQ pipeline, the Company's key focus throughout 2005 became to reduce the rate of cash absorbed by the business and, thereby, to accelerate the time at which the Company passes the break-even point. In addition to pursuing marketing programmes aimed at increasing both monitor sales and probe consumption, the Company acted to reduce its expenditure. Key measures included reducing headcount by over 20%, cutting back overheads, renegotiating terms with suppliers and improved working capital management. Cash available at 31 December 2005 was Â£606,000 including Â£219,000 drawn down under the Company's working capital facility. Since the end of the year the Company has raised a further Â£200,000 in equity after expenses. The average monthly cash burn in 2005 was Â£99,000 compared to Â£165,000 per month in 2004 and Â£226,000 in 2003. The progress made by the Company towards reaching the break-even point is demonstrated by the fact that the average monthly cash burn in the second half of 2005 was Â£64,000, less than half that of Â£134,000 in the first six months of the year. The Company therefore entered 2006 with the lowest rate of monthly cash burn in its history and the Directors are confident that the Company has adequate cash resources available to see it through to profitability. In the first quarter of 2006, the Company has continued to absorb considerably less cash than in the corresponding months in previous periods; this has been achieved despite a marked slow-down in collections from the NHS in the UK as hospitals seek to avoid or minimise deficits. Markets UK The UK is our most developed market and UK doctors lead the world in their understanding and acceptance of the benefits of active haemodynamic management in patients undergoing major surgery or those in critical care. There are now very few NHS hospitals in the UK where there is not at least some degree of active clinical advocacy for more frequent use of the CardioQ system and there are many hospitals where the clinical support is both broad and deep; the majority of anaesthetists now recognise that they ought to be monitoring and haemodynamically optimising at least some of their moderate and major risk surgical patients. This wide-scale clinical advocacy, supported by a substantial body of clinical evidence, is driving the continued steady growth in probe sales. However, we estimate that current clinical desire to use our technology is several times higher than actual usage rates and that the degree of clinical acceptance has grown several times more quickly than actual probe sales in the last two years. Although the NHS has long been recognised as being slow to finance the adoption of innovative medical technologies, the problem has been exacerbated recently by greater than normal financial restrictions. Many hospitals have run into financial deficit or are battling hard to avoid doing so. As a consequence many have scaled back dramatically already limited budgets both for purchasing capital items such as CardioQ monitors and revenue items such as our probes. To succeed in this environment, medical device companies have not only to demonstrate that the case for investment in its products is sound but that such an investment ought to be a high priority for each hospital. Deltex Medical is ideally positioned to do this, and during 2005 has worked with a number of acute hospital Trusts around the UK to undertake focused evaluations of the CardioQ in operating theatres to see if they can reproduce the benefits demonstrated by the real-world experience of the Medway Maritime Hospital NHS Trust, which is already saving Â£1 million a year following its investment in the CardioQ. These exercises are time-consuming and often complicated by the difficulty in collating management information on a hospital wide basis, however all such exercises completed to date have shown reduced post-operative complications and reduced lengths of hospital stays and have therefore been consistent with all the many randomised controlled clinical trials undertaken with the CardioQ. Feedback on results from sites undertaking such evaluations has been universally positive and has led to the submission of business cases for the purchase of our equipment in Trusts where these audits have been completed. The financial difficulties facing many NHS Trusts come at a time of far-reaching and fundamental change in the provision of healthcare in the UK, driven by the UK government's reform programme. Amongst other initiatives the government has introduced a set of national tariffs for surgical procedures and has encouraged private hospital providers to bid for contracts to treat large numbers of NHS patients undergoing elective surgery. These contracts are forcing the private providers to change their business models to focus on volume, price and quality. The CardioQ offers these providers opportunities as higher risk procedures such as hip and knee replacements start to be covered by the contracts. Accordingly, during the year, the Company entered into discussions with a number of the private provider groups and completed an encouraging initial evaluation in a private hospital in the South of England. This evaluation, based on 20 patients undergoing various types of moderate and major surgery, concluded that the hospital could reduce its standard patient journeys by one day per patient through using the CardioQ and that there might be a further unquantified benefit from reducing the frequency and severity of patients going off pathway due to avoidable complications. In June a group of eminent anaesthetists, surgeons and intensivists gathered in London for the launch of a lobbying pamphlet 'Modernising Care for Patients Undergoing Major Surgery'. This document, produced by the 'Improving Surgical Outcomes Group' (ISOG) has at its heart the belief that haemodynamic optimisation is the key to unlocking much of the resource required to implement a number of fundamental improvements in surgical patient care in UK hospitals. We are working with ISOG to support its efforts to promote the benefits of haemodynamic optimisation to doctors, senior health service managers, the Department of Health, politicians, patient groups and other stakeholders. Late in 2004, during a meeting with hospital managers in Scotland to discuss wide-scale implementation of the CardioQ, concerns were raised as to the status of CardioQ with respect to the National Institute for Health and Clinical Excellence's (NICE) Interventional Procedures Programme (IPP). The IPP seeks to determine whether a medical technique or technology is safe and efficacious. A technology either falls within the remit of the IPP process and is therefore subject to stringent reporting requirements each time it is used until it is deemed to be safe and efficacious, is recognised specifically to fall outside of the remit (on the grounds that it is established clinical practice with little uncertainty over safety or efficacy) or its status is unclear. A technology's status under this programme can have far-reaching commercial consequences for the manufacturer. Hospitals may choose not to purchase the technology if determination of its status has not been made and may continue to defer a purchase decision until it has been declared either outside the IPP remit or proven to be safe and efficacious within it. After seeking clarification of the CardioQ's status with regard to the NICE IPP from officials at the Scottish Executive, the Company itself sought further clarification from NICE in June 2005. NICE's decision dated 12 January 2006 was published on its website on 25 January 2006 and states: 'Oesophageal doppler monitoring involves the measurement of blood flow velocity in the descending thoracic aorta using a flexible ultrasound probe. NICE has recently become aware of this procedure. NICE has a commitment to consider whether procedures notified to the Institute fall within the remit of the interventional procedures programme. The Institute will go on to develop guidance on the safety and efficacy of all procedures that fall within the programme's remit. After careful consideration, NICE does not believe that this procedure falls within its remit. This is because oesophageal doppler monitoring is considered standard clinical practice with risks and benefits that are sufficiently well-known. For a more detailed description of the Interventional Procedures Programme, refer to the interventional procedures process manual, which is available from the NICE website at http://www.nice.org.uk/ ipprogrammemanual .' The Company estimates that at least 95% of oesophageal Doppler monitoring in the NHS is carried out using the CardioQ. The decision from Nice means that NHS hospitals wishing to purchase the CardioQ can do so without needing further approval. Europe The key goals of our sales activity in Europe in 2005 were to continue to tailor our core message to the specific circumstances of each of the markets in which we work, to provide our distributors with the tools required to drive probe usage by the existing installed monitor base, and to work with our French and Italian distributors to reduce stocks to the point where we could move them to a monthly ordering pattern in 2006. Our primary marketing goal has been to establish a relationship with the opinion leading surgeons and anaesthetists who are supporting various initiatives to improve surgical outcomes across Europe. We believe that use of the CardioQ has a very significant role to play in these initiatives and it is our goal that haemodynamic optimisation should be routine for all patients undergoing surgery under these protocols. In May 2005 we also announced that Radboud University Nijmegen Medical Centre in the Netherlands had become the first major university teaching hospital in Europe to adopt the CardioQ as a standard of care. Since this announcement, doctors at the hospital have continued to use their CardioQ and CardioQP(TM) monitors at the maximum level authorised by the hospital since their installation. Doctors championing the use of our products are working with senior hospital managers and our distributor to obtain additional funding to expand use into operating theatres and the newly opened intensive care unit. United States of America For the past three years we have focused our efforts in the USA on supporting a small number of internationally recognised key opinion leaders. These doctors are strong advocates of the use of the CardioQ in a variety of clinical settings and they are responsible for much of the physician-to-physician training that happens in the USA. In addition, we are pursuing a number of projects that will help us develop a scalable business that we can implement with a third-party at an appropriate point in the future. Our two biggest users in the US have responded to our sales efforts and recently begun to migrate usage 'upstream' into the operating room (OR). Even a relatively modest level of adoption in the OR in either one of these hospitals would have a significant positive impact on our sales in the USA. Overall, probe volumes were stable in the USA. Sales of monitors (12 units in 2005) were the highest recorded in the USA since we launched the CardioQ in 1999. They included, in September 2005, the sale of four CardioQ monitors to the William Beaumont Army Medical Center in El Paso, Texas. The monitors are intended for use in medical and surgical patients in the intensive care unit and those patients undergoing elective or emergency surgery in the operating room. Physicians at the hospital are also working to make the CardioQ an integral part of patient care in a wider range of clinical applications, including trauma surgery and neurosurgery. The William Beaumont Army Medical Center treats active service personnel and their dependants and also provides field-based hospital facilities in areas of conflict around the world as required by the US military. Far East and Latin America Each of our distributors in the Far East and Latin America has trained personnel that can support the CardioQ in the field and the Company provides high-quality technical support at a low cost via telephone and over the internet. Sales to these markets remain occasional and of varying value, however in 2005 sales were significantly ahead of 2004 (Â£163,000 against Â£65,000), mainly due to a larger order from our Peruvian distributor. We understand this order to have been underpinned by growing clinical demand and expect to see a similar large order in 2006, Peru is now established as our fourth largest distributed market, behind France and Korea and on a par with Italy. While our field-based investment into the Far East and Latin American territories has been reduced over the last two years, the quality of the business generated has improved considerably in terms of value and payment profiles. We remain cautious in our approach and do not foresee any substantial change in our strategy in these markets in the short-term. We are however, able to report continued signs of growth and the emergence of future opportunities for investment as our distributors complete the first phase of gaining a foothold for our products in their respective markets. Research and Development The primary goal for our research and development (R&D) efforts is the development of a range of monitoring solutions for patients who are conscious. This will enable doctors to provide the benefits of haemodynamic optimisation to patients who are undergoing surgery without the use of a general anaesthetic, for example in many hip replacement procedures, or who are conscious in the critical care setting. In both of these examples, vulnerable patients miss out on the rapid and effective intervention that unconscious patients benefit from through use of the CardioQ. While we do have a probe variant designed for use in un-sedated patients, there are still a small but important number of patients who could benefit from either an improved version of this probe or a wholly non-invasive monitor such as the SupraQ(TM). During 2005 we were able to conclude some important developmental tasks related to understanding the effects of patient anatomy on signal acquisition. Going forward into 2006, we expect to continue to sell a limited number of one of these variants to further our knowledge and help us refine the technology. As well as providing conscious patients with essential monitoring, the Medway hospital in Gillingham is carrying out some of this work for us using the three SupraQ devices they purchased from us at the end of 2005. We see continued development of solutions for the conscious patient as a critical part of our R&D efforts as the potential clinical applications for the SupraQ go far beyond those conscious patients having surgery or in critical care. Clinical Trial Developments During 2005 the British Journal of Anaesthesia published the results of a government funded, randomised controlled clinical trial into the use of the CardioQ in patients undergoing major bowel surgery. The trial, undertaken by consultant anaesthetist Dr Howard Wakeling in conjunction with his surgical colleagues at Worthing Hospital, demonstrated that using the CardioQ to optimise circulating blood volume led to a reduction in hospital stay of one and a half days when compared to fluid management based around pressure measurements alone and without the benefit of the information provided by the CardioQ. In May we announced the presentation of initial results from a double-blinded prospective randomised controlled clinical trial that used the CardioQ in patients undergoing major bowel surgery. The trial was undertaken by surgeons and anaesthetists at the Freeman Hospital in Newcastle-upon-Tyne and the first results to come from the study were presented at The American Society of Colon and Rectal Surgeons meeting in Philadelphia. The statistically significant results of the study included a reduction in major post surgical complications in the CardioQ group with only 1% of patients suffering such a complication compared to 13.7% in the control group. The average (median) hospital stay was seven days for CardioQ patients compared to nine days in the control group. The trial concluded that fluid optimisation using the CardioQ leads to shorter hospital stays and a decrease in major morbidity with consequent major implications for the management of patients in fast-track regimens. Doctors from the Royal Free hospital were awarded two first prizes for work they had undertaken using the SupraQ device to manage the complicated haemodynamics of patients undergoing elective caesarean section. In this trial the monitor was used to determine the relative effectiveness of two drugs in maintaining blood pressure during the procedure. The results were presented and awarded first prize at the Society of Obstetric Anesthesia and Perinatology meeting held in Palm Desert, California, USA and at the Obstetric Anaesthetists' Association meeting held in London in May 2005. Looking forward, Dr Bernard Cholley, an anaesthetist and intensive care specialist based in Paris, will lead the first multi-centre, randomised, controlled trial investigating the impact of the use of CardioQ on death rates following emergency hip fracture repair. This trial, partially funded by the French government, will involve more than 15 hospitals across France and will enrol its first patient in 2006. It is likely to take three years to complete. The expectation is that the trial will confirm the anecdotal evidence that haemodynamic optimisation in this very high-risk surgery saves lives. Prospects The continued growth in supportive clinical trial data and the experience of hospitals throughout the world using the CardioQ continues to reinforce the clinical and economic benefits of haemodynamic optimisation using our products. The pressures bearing down on healthcare providers both for better quality care and reductions in cost mean that technologies such as the CardioQ that can deliver both will win out over those that cannot. CardioQ sales in the first quarter of 2006 have been encouraging and we remain confident in our ability to deliver increasing and sustainable value for our shareholders by focusing on delivering better, more cost effective care for patients undergoing major surgery or in intensive care. Nigel Keen Chairman 21 March 2005 Consolidated profit and loss account for the year ended 31 December 2005 2005 2004 Note Â£'000 Â£'000 Unaudited Audited Turnover 2 3,042 2,494 Cost of sales (1,076) (907) ---- ---- Gross profit 1,966 1,587 ---- ---- Net operating expenses (3,479) (4,374) ---- ---- Operating loss (1,513) (2,787) Net interest 3 14 ---- ---- Loss on ordinary activities before taxation (1,510) (2,773) Tax on loss on ordinary activities 22 19 ---- ---- Loss for the financial year (1,488) (2,754) ========= ========= Loss per share - basic and diluted (2.1p) (4.3p) ========= ========= The above results all relate to continuing operations. The loss on ordinary activities before taxation and the loss for the financial year have been computed on the historical cost basis. Statement of Group total recognised gains and losses for the year ended 31 December 2005 2005 2004 Â£'000 Â£'000 Unaudited Audited Loss for the financial year (1,488) (2,754) Currency translation differences in foreign currency net 9 (5) investment ---- ---- (1,479) (2,759) ========= ========= Consolidated balance sheet At 31 December 2005 2005 2004 Â£'000 Â£'000 Unaudited Audited Fixed assets Tangible assets 85 136 ---- ---- Current assets Stocks 443 758 Debtors: amounts falling due within one year 967 783 amounts falling due after more than one year 99 72 Cash at bank and in hand 606 1,207 ---- ---- 2,115 2,820 Creditors: amounts falling due within one year (1,089) (925) ---- ---- Net current assets 1,026 1,895 ---- ---- Total assets less current liabilities 1,111 2,031 Creditors: amounts falling due after more than one year (1) (7) Provision for liabilities and charges (34) (30) ---- ---- Net assets 1,076 1,994 ========= ========= Capital and reserves Called up share capital 726 695 Share premium account 12,712 12,182 Capital redemption reserve 17,476 17,476 Profit and loss account (29,838) (28,359) ---- ---- Equity shareholders' funds 1,076 1,994 ========= ========= Consolidated cash flow statement for the year ended 31 December 2005 2005 2004 Note Â£'000 Â£'000 Unaudited Audited Net cash outflow from operating activities 3 (1,263) (1,988) ---- ---- Returns on investments and servicing of finance Interest received 9 15 Finance lease interest (3) (1) Finance interest (3) ---- ---- Net cash inflow from returns on investments and 3 14 servicing of finance ---- ---- Taxation - 102 ---- ---- Capital expenditure Purchase of tangible fixed assets (17) (9) ---- ---- Net cash outflow from capital expenditure (17) (9) ---- ---- Net cash outflow before financing (1,277) (1,881) ---- ---- Financing New finance leases - 15 Other borrowings 114 105 Capital element of finance lease rentals (7) (2) Issue of ordinary share capital 571 1,964 Expenses of share issue (10) (85) ---- ---- Net cash inflow from financing 668 1,997 ---- ---- (Decrease)/increase in net cash in the year (609) 116 ========= ========= Notes to the preliminary results for the year ended 31 December 2005 1. Nature of the financial information The financial statements for Deltex Medical Group plc have yet to be approved for the year ended 31 December 2005. The financial information set out in this announcement does not constitute the Company's statutory accounts for the year ended 31 December 2005 or 31 December 2004. The financial information for the year ended 31 December 2004 is derived from the statutory accounts for that year which have been delivered to the Registrar of Companies. The auditors reported on those accounts; their report was unqualified and did not contain a statement under either Section 237 (2) or Section 237 (3) of the Companies Act 1985. The statutory accounts for the year ended 31 December 2005 will be finalised on the basis of the financial information presented by the directors in this preliminary announcement and will be delivered to the Registrar of Companies following the Company's Annual General meeting. The preliminary results have been prepared in accordance with applicable accounting standards. The particular accounting policies adopted are the same as those adopted in the financial statements for the year ended 31 December 2005. 2. Turnover The Group's activities consist solely of the manufacture, maintenance and marketing of medical devices. By origin, all sales are United Kingdom sales except for Â£358,000 of sales from the Company's U.S. subsidiary (2004: Â£284,000). 2005 2005 2005 2005 Probes Monitors Other Total Â£'000 Â£'000 Â£'000 Â£'000 Analysis of turnover by destination Direct markets United Kingdom 1,559 251 88 1,898 United States of America 303 50 5 358 Distributor markets Rest of Europe 289 328 6 623 Rest of the World 128 34 1 163 --- ---- ---- ---- 2,279 663 100 3,042 ======= ======== ======== ======== Continued from table above 2004 2004 2004 2004 Probes Monitors Other Total Â£'000 Â£'000 Â£'000 Â£'000 Analysis of turnover by destination Direct markets United Kingdom 1,254 169 53 1,476 United States of America 273 10 1 284 Distributor markets Rest of Europe 390 277 2 669 Rest of the World 32 32 1 65 --- ---- ---- ---- 1,949 488 57 2,494 ======= ======== ======== ======== 3. Reconciliation of operating loss to net cash outflow from operating activities 2005 2004 Â£'000 Â£'000 Unaudited Audited Operating loss (1,513) (2,787) Depreciation on tangible fixed assets 66 79 Decrease/(increase) in stocks 178 (186) (Increase)/decrease in debtors (189) 1,015 Increase/(decrease) in creditors 193 (237) Costs associated with share option schemes - 124 Foreign exchange differences (2) (26) Increase in provisions 4 30 --- --- Net cash outflow from operating activities (1,263) (1,988) ======= ======= 4. Dividends The directors do not recommend payment of a dividend (2004: nil). 5. Loss per share The loss per share calculation for 2005 is based on the loss of Â£1,488,000 and weighted average number of shares in issue of 70.4 million. For 2004 the loss per share calculation was based upon the loss of Â£2,754,000 and weighted average number of shares in issue of 63.4 million. The Group had no dilutive potential ordinary shares in either year, which would serve to increase the loss per ordinary share. Therefore there is no difference between the loss per ordinary share and the diluted loss per ordinary share. 6. Provision for liabilities and charges In 2004, an amount of Â£5,000 relating to National Insurance payable on options exercised, has been reclassified from provisions for liabilities and charges to accruals in order to be consistent with the current year's presentation. 7. Distribution of announcement Copies of this announcement are being sent to all shareholders and will be available for collection free of charge from the Company's registered office at Terminus Road, Chichester, West Sussex PO19 8TX. This information is provided by RNS The company news service from the London Stock Exchange

Companies

Deltex Medical Group (DEMG)

Full Archive

UK 100

Latest directors dealings

All directors dealings today