Interim Management Statement

RNS Number : 4751P

IP Group PLC

25 October 2012

 



 

FOR RELEASE ON

25 OCTOBER 2012

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

IP Group: Interim Management Statement

IP Group plc (LSE: IPO), the developer of intellectual property based businesses, today issues its Interim Management Statement in accordance with FSA Disclosure and Transparency Rule 4.3.

This statement provides an update on the Group's progress for the period from 30 June 2012 to date.

Alan Aubrey, Chief Executive of IP Group, said:

"I am pleased to report that further positive progress has been made by the Group since our half-year results, with the portfolio producing net unrealised fair value gains of £7m. In line with previous commitments the Group has continued its increased rate of capital deployment yet has maintained a strong cash and financial position, helped in part by the £15m initial proceeds received as a result of the Proximagen sale to Upsher-Smith."

Portfolio update

As at 22 October 2012, the fair value of the Group's portfolio was £168.2m, which represents a net unrealised fair value increase of £7.3m, excluding the investments and realisations described below.

During the period from 1 July 2012 to 22 October 2012, the Group provided incubation, seed and development capital totalling £5.6m to 16 portfolio companies. Last year, during the period covered by the Group's Q3 2011 IMS, a total of £2.4m was provided to 15 companies. Investments for the year to date now total £21.4m (Q3 2011 IMS: £7.9m).

Largely as a result of the sale of Proximagen Group plc to Upsher-Smith during August, as previously announced, the Group received total proceeds of £16.2m for the period, compared to £3.5m for the equivalent period in 2011. Under the terms of the Proximagen sale, the Group could receive up to a further £9.2m in cash by way of a contingent value right ("CVR") over the next five years.

The Group's portfolio now consists of holdings in 66 intellectual property based companies, compared to 64 companies at 30 June 2012. There have been four new additions to the portfolio during the period and two sales. The additions included Medaphor Limited, a Fusion IP company that is developing medical training simulators, Oxehealth Limited, a spin-out from Oxford's Institute of Biomedical Engineering that is developing software to monitor patients' vital signs using a webcam and Cryptographiq Limited, a new spin-out from Leeds University that is developing cyber-security tools.

Significant developments in the Group's portfolio companies since 30 June 2012 have included:

·      In October, University of Leeds spin-out Tissue Regenix Group plc announced its half-yearly results and that its dCELL® Dermis (application of human skin which has been treated with Tissue Regenix's dCELL® process) had produced encouraging results from interim clinical data. The trial, which is being conducted at University Hospital of South Manchester and involves 20 patients, has shown that treatment of chronic wounds with dCELL® Dermis led to a significant reduction in the size of all wounds, while 45% of patients have been completely healed. The trial, which is being conducted in partnership with NHS Blood and Transplant, and is due to complete by the end of the year, is studying the effectiveness of dCELL® Dermis in treating chronic wounds, consisting primarily of venous leg ulcers that have failed to respond to standard treatments. Patients involved in the trial had, on average, suffered with chronic ulcers for more than four and a half years.

·      In September, Modern Water plc, the owner of leading water technologies for the production of fresh water and monitoring of water quality, announced that it had completed the installation and commissioning of its 200 cubic metres per day forward osmosis desalination plant at Al Najdah in the Al Wusta region of Oman. Modern Water was awarded the contract, worth approximately £0.4m to Modern Water, to build and operate the plant in June 2011 by Oman's Public Authority for Electricity and Water. It is the world's first commercial forward osmosis desalination plant and the Group's second plant in Oman.

·      In July, Revolymer plc ("Revolymer"), best known for its removable chewing gum, joined the AIM market raising £25m of new money, before expenses. Revolymer's interim financial results described an overall loss of £4.0m but good progress with its 6 current JDAs with major international partners in the household products and coatings & adhesives business areas. Revolymer has also announced the launch of its nicotine gum in Canada and that Julian Heslop, formerly chief financial officer of GlaxoSmithKline plc, and Dr Bryan Dobson, formerly of Croda International plc, have joined its board as non-executive directors.

·      In September, Oxford Catalysts Group plc's interim results highlighted revenues of £3.6m and that its technology had been selected for multiple projects during the period including a 1,000 bpd commercial Gas-to-Liquids plant for NASDAQ-listed Calumet, a GreenSky London waste-biomass to jet fuel commercial plant, in partnership with British Airways and a small-scale Gas-to-Liquids facility commissioned by Rosneft. In October, the group announced that Sandy Shaw, currently executive director at Valiant Petroleum, had joined its board as a non-executive director.

Balance sheet update

At 22 October 2012, the Group had no borrowings, cash of £53m, a diversified portfolio valued at £168m and net assets of £257m, representing 70p per share. Excluding intangible assets and the Oxford Equity Rights asset, the Group's net assets were £228m or 62p per share.

For more information, please contact:

IP Group plc

Alan Aubrey, Chief Executive Officer                    [phone]

Greg Smith, Chief Financial Officer

FTI Consulting                                                 [phone]

Ben Atwell, John Dineen

This statement is intended to give an indication of material transactions and events that have taken place since 30 June 2012 and their impact on the financial position of the Group. These indications reflect the Board's current view, are subject to a number of material risks and uncertainties and could change in the future. Factors which could cause or contribute to such changes include, but are not limited to, the general economic climate and market conditions, as well as specific factors relating to the financial or commercial prospects or performance of individual portfolio companies with the Group's portfolio.

Notes for editors

About IP Group

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

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

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

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

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

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