Annual results for period ended 31 December 2016
Tissue Regenix Group plc
Annual results for period ended 31 December 2016
Group Revenues increase 77%
Increased reimbursement coverage and penetration in key US markets
Significant progress towards commercialisation of Orthopaedic products in the EU
Leeds, 02 June 2017 - Tissue Regenix Group (AIM:TRX) ("Tissue Regenix" or "The Group") the regenerative medical devices company, today announces its audited results for the 11 months ended 31 December 2016, reflecting earlier announcement of change to accounting reference period to a December year end.
Operational and Recent Highlights
· Commercialisation strategy progressing coverage and penetration
- Signed three US Group Purchasing Organisations (GPO) Agreements including top two GPO's in US, Premier and Vizient, securing 75% coverage of GPO hospital beds in US
- Secured further Medicare coverage to 93% of outpatient settings
- Added to Federal Supply Schedule, covering an additional 9 million patients
· Established US Orthopaedic subsidiary ahead of potential entry in US sports medicine market
- Appointed US Orthopaedic clinical advisory Board
· Submitted initial clinical data for OrthoPure XT CE mark
- Commercial roll-out targeted for 2017, subject to EU approval
- First EU distribution agreement signed
· Strengthened Corporate Board with financial and clinical expertise
- Shervanthi Homer-Vanniasinkam joins as Non-Executive Director
- Appointment of Paul Devlin as CFO,
· Company remains in constructive dialogue with CellRight Technologies
Financial Highlights
· Revenues increased 77% to £1.4 million (2016: £816k), driven by:
- Strong performance from DermaPure® sales, up 64% to £1.3 million
- First Revenues from joint venture GBM-V
· Operating loss of £11.1 million (2016: 10.2 million) as expected reflecting increased investment in sales and marketing
· Cash and cash equivalents as at 31 December 2016 of £8.2 million
Antony Odell, CEO, Tissue Regenix Group, commented: "We have made significant progress across the business during the year. The growing momentum behind our portfolio of pioneering regenerative medical devices has increased with market adoption. This is reflected in the financial performance of the business with Group revenue growth of 77%, wound care growth of 64% and initial sales from our German joint venture.
"In the US, our wound care business successfully secured expanded Medicare coverage, which now stands at 93% of Medicare beneficiaries. We also gained contract approvals under the two largest US GPO's, Premier and Vizient, both of which were awarded under the respective 'Innovative Technology' awards, offering a credible and independent review of dCELL® Technology.
"During the year we also submitted clinical data to the regulatory body for CE mark approval for our first Orthopaedic product, OrthoPure XT. With initial distributors Agreements signed we expect a timely roll out once approval is granted however, ongoing changes to the Medical Device Regulations extended the timeline for launch but we continue our dialogue with the regulator and still anticipate that this will take place during 2017.
"Elsewhere, we continue to pursue the necessary regulatory approval to roll out DermaPure and CardioPure in the EU and, upon finding a suitable tissue bank partner for OrthoPure HT in the US, we expect to enter the US sports medicine market in the near future.
"We believe that the progress we have made across each of our business units and the exciting organic growth opportunities afforded by our broad development pipeline of innovative products and the recently signed GPO contracts means that we are well placed for future growth."
For more information:
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Tissue Regenix Group plc Caitlin Pearson Corporate Communications Director
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Tel: 0330 430 3073 |
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Jefferies International Ltd Simon Hardy / Harry Nicholas
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Tel: 020 7029 8000
|
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FTI Consulting Brett Pollard/ Mo Noonan |
Tel: 020 3727 1000 |
About Tissue Regenix
Tissue Regenix is a leading medical devices company in the field of regenerative medicine. The company's patented decellularisation ('dCELL®') technology removes DNA and other cellular material from animal and human tissue leaving an acellular tissue scaffold which is not rejected by the patient's body which can then be used to repair diseased or worn out body parts. The potential applications of this process are diverse and address many critical clinical needs such as vascular disease, heart valve replacement and knee repair.
Tissue Regenix was formed in 2006 when it was spun-out from the University of Leeds. The company commercialises academic research conducted by our partners around the World.
In November 2012 Tissue Regenix Group plc set up a subsidiary company in the United States - 'Tissue Regenix Wound Care Inc.', as part of its commercialisation strategy for its dCELL® technology platform.
Chairman's Statement
"Across the 11 months to 31 December 2016 Tissue Regenix executed several steps of its evolving commercialisation strategy as operations in both the US and EU continue to expand."
John Samuel Chairman
The Group delivered combined revenues of £1,443k, which was bolstered by the first revenues from controlled joint venture GBM-V. Wound care delivered revenue of £1,322k, a 64% increase on the figures reported last year, and in line with expectations.
Strategy
Strategically, the Group has continued to evolve its commercialisation efforts spanning both the US and EU. The creation of controlled joint venture GBM-V has allowed the submission for regulatory approval to commence for allograft products within the EU, and we expect to be in a position to report positive newsflow throughout the year. Not only is this relevant for the joint venture in the EU, but also validates the commercial viability of this model for other potential partnerships.
The wound care division achieved significant success in executing the commercial strategy for DermaPure®, accessing the hospital setting. Of particular relevance was the award of GPO Agreements, especially Premier and post year end, Vizient, both of which were granted under their respective "Innovative Technology" programmes, providing an independent review and endorsement of the dCELL® technology. Under these agreements DermaPure is now accessible to over 1 million hospital beds in the US, complementing the comprehensive Medicare reimbursement covering 93% of Medicare beneficiaries. These agreements will be pivotal in the commercial traction and success over the coming year.
OrthoPure™ XT, a decellularised porcine ligament for ACL reconstruction, successfully completed the clinical trial enrolment and it is expected that CE Mark approval and commercial roll-out will be achieved during 2017. This will be a significant step for both the Orthopaedics division and also the Company as a whole as it signifies commercialisation under each of the core business divisions. Having signed the first EU distribution agreements for OrthoPure™ XT we are confident that the implementation of the distributor led commercialisation strategy will be successful throughout the coming year.
Governance
As the Company enters a phase of accelerated growth, necessary steps have been taken to ensure that the Company is aligned with the best corporate compliance and governance standards. This included the addition of Shervanthi Homer-Vanniansinkim who brings clinical expertise to the Board, complementing the commercial experience vested in the Non-Executive Directors. In January we also welcomed a new Chief Financial Officer, Paul Devlin. Paul brings with him significant experience of guiding companies through a period of rapid growth, mergers, acquisitions and joint ventures. It is expected that he will play a fundamental role in the strategic direction of the Company in the future.
Accounting Reference Date
As previously announced the Company has changed the accounting reference date to 31 December. These accounts are therefore reporting an 11 month period.
Finance
I draw your attention to the going concern statement in the Corporate Governance Statement and Note 1 to the financial accounts. The Directors are confident that additional funds will be made available to continue to fund the business.
Outlook
Significant progress has been made in the transition from development to commercialisation and we expect each division to reach a significant inflection point over the next year. The advances that have been made during the reported period are a reflection of the ongoing commitment and enthusiasm of the staff, and I would like to personally thank all for their continuing efforts. As we enter a phase of accelerated growth we anticipate to see our focus on commercialisation come to fruition.
John Samuel
Chairman
2 June 2017
Ceo Statement
"We have made significant progress from development to commercialisation and expect to reach a significant inflection point for each division in the coming year"
Antony Odell chief executive officer
The changing macro environment presented both challenges and opportunities this year.
The Group has steadily progressed with programmes as we continue to evolve as a commercial company, seeking creative solutions to the challenges faced. The Group continues to pursue new business opportunities whilst maintaining focus on executing the long term strategy, creating shareholder value and, over time, generating financial returns.
Throughout the year the Group consolidated its presence in the US wound care market and is positioned for future entry into the European sports medicine and heart valve markets, both of which represent growth opportunities.
Business Developments
After establishing the controlled joint venture GBM-V in Germany in January 2016, significant progress has been made with regulatory submissions and barring any delays with this process, it is expected that commercialisation for both DermaPure® and CardioPure™ human heart valves will commence throughout Europe during 2018. GBM-V is the first German multi- tissue bank, the objective being to process different human tissues at one facility. As demonstrated by the results, the first revenues were generated from this tissue bank which was achieved by the distribution of cryo-preserved corneas. The substantial progress made here validates the strategy employed and this business model paves the way for future alliances to be built.
Divisional Overviews
Our corporate structure vests the IP, finances and knowledge in the individual business divisions. This allows each division to remain focused, employing experts in each field for the development and commercialisation of products within these clinical areas. This model also allows the business to stay responsive and flexible to relevant business opportunities.
Wound Care
The US wound care division had a strong start to the year with further Medicare coverage cementing DermaPure® within the outpatient setting. However, it was the latter part of the year in which significant traction was gained, with approval of the first Group Purchasing Organisation (GPO) agreement in July, followed in December by Premier, the second largest GPO in the country. As illustrated in the marketplace section on page 6, these GPO approvals are pivotal to commercial success in the hospital setting, in which, there are significant benefits for DermaPure®. It was also announced after the year end that approval under Vizient, the largest GPO in the US, had been secured meaning that 75% of the hospital beds under GPO agreements in the US are now covered, complementing the 93% Medicare coverage held for outpatient settings. In conjunction to this, DermaPure® was also added to the Federal Supply Schedule in February 2017 allowing access to the 152 hospitals and 800 community based outpatient clinics under their jurisdiction, covering an additional 9 million patients.
This successful reimbursement structure allows for increasingly expansive commercial penetration into the wound care market in the current year.
The intention to launch SurgiPure™ XD, a porcine dermis application for hernia repair, into the US market following the 510k approval was postponed as staff members were redeployed to accelerate the OrthoPure™ XT timeline for Europe. However, it is expected that we will add SurgiPure™ XD to the US wound care portfolio in early 2018.
Orthopaedics
Orthopaedic progression has been driven largely by OrthoPure™ XT, a porcine tissue application to address ACL reconstruction, which completed the necessary EU clinical trial enrolment and is currently progressing through the regulatory process for CE mark approval.
Due to the changes implemented by the introduction of the revised Medical Device Regulations, the timeline for approval was delayed. However, it is still expected that approval and launch will commence during 2017. The initial commitment of European distributors has been encouraging, having entered a number of agreements in preparation for a timely roll-out.
For launch, the initial focus will be on our key European markets which will include Germany, Spain and Poland. The Group envisages a roll-out plan over 12-18 months as the reimbursement strategy for each region is established, and engagement with appropriate distribution partners undertaken.
The US commercialisation strategy continues to evolve and it is expected that, given a suitable tissue bank partner is identified, the transfer of the technology process for OrthoPure™ HT, the human tissue version of our ACL product, will commence later this year with commercialisation to follow soon after, paving the way into the US sports medicine market. To aid in negotiating the complex US marketplace a prestigious Board of Clinical Advisers was appointed with whom we will work closely throughout this process, including:
· Steven Arnoczky, DVM, Michigan State University, East Lansing, MI
· David Caborn, MD, University of Louisville, Louisville, KY
· Thomas Carter, MD, Team Physician for the Phoenix Suns, Phoenix, AZ
· Philip Davidson, MD, Davidson Orthopedics, Salt Lake City, UT
· Jack Farr II, MD, Orthoindy, Indianapolis, IN
Cardiac
Commercial progress this year was primarily focused on the GBM-V work, and the ongoing regulatory submissions to allow launch of the CardioPure™ HAV/HPV in Germany. The results being returned from Francisco da Costa's pioneering work in Brazil, which has now entered its 11th year, remain impressive and encouraging and was recognised by the Jefferey Borer Abstract Award in March 2016. The results have been displayed worldwide and interest in the decellularised human heart valves is ever increasing.
Our 2017 Milestones and Objectives
As the Group continues to expand its commercial product portfolio and presence within relevant clinical application areas throughout different territories, the key milestones for 2017 are listed below. Associated to the successful execution of each are various risks, the main ones of which are listed below. More information on how the Group intend to mitigate some of these risks can be found on pages 16 to 17.
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Milestone |
Risks |
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European launch of OrthoPure™ XT |
Due to the change of Medical Device Regulations there is a risk of further regulatory delay. Once approval is granted it will be manufactured at our in-house manufacturing facility in Leeds relying on a successful ramp-up of processing. |
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European approval of DermaPure® and Human Heart Valves
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We are currently working through the regulatory process for both products and there are therefore risks to the timelines for regulatory approval. As both are human tissue products there could be a risk to the supply of suitable materials. |
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Launch of thicker and larger DermaPure® sizes in the US
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Reliance on partner to produce suitable amounts of product within the distribution timeline |
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US launch of OrthoPure™ HT |
Finding a suitable tissue bank partner to source and process the donated tissue. Potential limitation of suitable donated tissue. |
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Establishment of OrthoPure™ XT clinical trial requirements for the US |
Delay in regulatory requirements. Financial implications due to the cost associated with the clinical trials. |
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Objective |
How we will achieve this: |
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Increase DermaPure® sales and market penetration |
Now that we have achieved three GPO agreements, and 93% Medicare coverage we are in a position to translate this into commercial traction and increase our presence within the inpatient setting, where DermaPure® offers an effective clinical and economic solution. |
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Retain key staff and minimise employee turnover |
We value the personal and professional development of our employees, actively encourage relevant training and qualifications and have a number of employee benefit opportunities in place to aid employee loyalty and satisfaction. |
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Engage Key Opinion Leaders and drive advocacy for the dCELL® Technology product portfolio |
We already have a number of KOLs engaged for DermaPure®. Having appointed a clinical advisory board for Orthopaedics in the US we will look to leverage their expertise to educate and inform the wider clinical community. |
KPIs
KPIs help us to track and monitor performance, against a defined set of financial and non-financial targets allowing teams to monitor their performance throughout every level of the business. Our executive management monitor against these targets with the Board ensuring that the KPIs in place accurately reflect the inflection points of the Group, and advising on strategy to ensure that these are met.
OUR ONGOING KPIs
Key Group performance indicators are set out below:
· Monthly review of product development timelines and costs
· Monthly review of revenue progress and forecasts
· Monitoring of cash balance and associated working capital requirements
· Monthly review of actual results against budget
Our People
Our talent is a key stakeholder in our future success and we strengthened our management team with the addition of a VP of Orthopaedics for the US, as well as addressing the growing national contracting positioning of DermaPure in the US by strengthening our leadership team to facilitate these contracts.
We augmented our Board with the appointment of Shervanthi Homer - Vanniansinkim who brings extensive clinical expertise to the table, and has been a clinical adviser to the Group for a number years.
At the beginning of 2017 we welcomed a new CFO, Paul Devlin, who brings with him a wealth of experience in the merger and acquisition field, as well as joint ventures and business transformations. His experience will be key in guiding the Group through the next stages of development.
Current Trading and Outlook
Following the award of two major GPO contracts with Premier and Vizient in December 2016 and March 2017 respectively, the Group now has 75% coverage for hospital based wounds in the US, complementing the 93% Medicare reimbursement coverage for outpatient settings. To identify the areas of highest opportunity and to maximise the sales potential of these GPO contracts, the Group undertook a detailed analysis of its addressable hospital market and has accordingly restructured its direct sales force on a regional basis to prioritise high potential hospitals, whilst continuing to use distributors to access other areas. To support this new focus, the Group has strengthened its US leadership team, acquiring specific expertise pivotal to the success of driving performance and pulling through clinical demand from the GPO agreements, which the group expects will maximise sales execution and ultimately enhance revenue performance.
These operational changes were implemented in the first quarter of this year with the impact of these changes taking effect progressively throughout H1. Tissue Regenix achieved wound care revenue of $0.6m in the 4 months to 30 April 2017, with over 45% of revenue in April secured via GPO agreements. With the benefits of the restructured sales force already becoming evident and as individual hospital approvals increase, the Group expects sales in wound care to accelerate significantly in the second half of the year.
With DermaPure now positioned to meaningfully increase market penetration, the Group expects a significant and sustained acceleration in sales growth over the medium term based on DermaPure's superior patient outcomes, strong clinical support and increasingly broadly-based hospital approvals. As hospital-based adoption increases the Group believes that this will benefit its distributor channels as well as its ability to address the out-patient setting.
The one year clinical data for OrthoPure XT has been submitted to its notified body and the Group believes this will support the grant of a CE mark and allow for a commercial roll out during 2017 despite the added uncertainty that the new Medical Device Regulations have brought to the regulatory approval process.
In addition, GBM-V, the Group's controlled joint venture in Europe is expected to make an increased contribution during the first half of this year with momentum expected to continue as the year progresses.
The Group believes that the refocused sales approach targeting key markets, its broad development pipeline of innovative products offering exciting organic growth opportunities and its forthcoming entry into the US orthopaedics market in 2018, means that it is well placed for future growth.
CFO Statement
"The Group reported wound care revenues of £1,322k for the 11-month period (January 2016: £808k), an increase of 64%."
paul devlin Chief Financial Officer
Tissue Regenix plc have grown sales by 77% to £1,443k in the 11 months to December 2016 (January 2016: £816k). Operating loss in the same period was £11,060k (January 2016: £10,242k). Finance income was £114k in the period (January 2016: £213k) with a research and development tax credit of £1,034k (January 2016: £527k) generating a loss after tax of £9,912k (January 2016: £9,502k), of which £9,786k was attributable to equity holders.
Accounting Reference Date Change
As announced at the last annual result, the Group's accounting reference period has been adjusted to a 31 December year end, meaning that the results now reported are for a shortened 11-month period, and moving forward will bring the fiscal year in line with the calendar year.
Segmental Analysis
A split of the Group's results by application area, as extracted from the operating segment analysis (see note 3), is shown below along with a further breakdown of administrative costs:
|
|
Wound Care |
Orthopaedics |
Cardiac |
GBMV |
Central |
Total |
||||||
|
|
11 Months up to 31 Dec 2016 £000 |
12 Months up to 31 Jan 2016 £000 |
11 Months up to 31 Dec 2016 £000 |
12 Months up to 31 Jan 2016 £000 |
11 Months up to 31 Dec 2016 £000 |
12 Months up to 31 Jan 2016 £000 |
11 Months up to 31 Dec 2016 £000 |
12 Months up to 31 Jan 2016 £000 |
11 Months up to 31 Dec 2016 £000 |
12 Months up to 31 Jan 2016 £000 |
11 Months up to 31 Dec 2016 £000 |
12 Months up to 31 Jan 2016 £000 |
|
Total segment |
1,322 |
884 |
- |
- |
- |
76 |
121 |
- |
|
8 |
1,443 |
968 |
|
Inter-segment |
- |
(76) |
- |
- |
- |
(76) |
- |
- |
|
|
- |
(152) |
|
Revenue |
1,322 |
808 |
- |
- |
- |
- |
121 |
- |
- |
8 |
1,443 |
816 |
|
Cost of sales |
(288) |
(154) |
- |
- |
- |
- |
(66) |
- |
- |
- |
(354) |
(154) |
|
Gross Profit |
1,034 |
654 |
- |
- |
- |
- |
55 |
- |
- |
8 |
1,089 |
662 |
|
Administrative costs |
(5,500) |
(4,938) |
(2,738) |
(2,382) |
(462) |
(352) |
(308) |
(183) |
(3,141) |
(3,049) |
(12,149) |
(10,904) |
|
Operating loss |
(4,466) |
(4,284) |
(2,738) |
(2,382) |
(462) |
(352) |
(253) |
(183) |
(3,141) |
(3,041) |
(11,060) |
(10,242) |
|
Finance income |
- |
- |
- |
- |
- |
- |
|
- |
114 |
213 |
114 |
213 |
|
Loss before taxation |
(4,466) |
(4,284) |
(2,738) |
(2,382) |
(462) |
(352) |
(253) |
(183) |
(3,027) |
(2,828) |
(10,946) |
(10,029) |
|
Taxation |
323 |
169 |
600 |
324 |
111 |
16 |
|
- |
- |
18 |
1,034 |
527 |
|
Loss for the year |
(4,143) |
(4,115) |
(2,138) |
(2,058) |
(351) |
(336) |
(253) |
(183) |
(3,027) |
(2,810) |
(9,912) |
(9,502) |
|
|
Wound Care |
Orthopaedics |
Cardiac |
GBMV |
Central |
Total |
||||||
|
|
11 Months up to 31 Dec 2016 £000 |
12 Months up to 31 Jan 2016 £000 |
11 Months up to 31 Dec 2016 £000 |
12 Months up to 31 Jan 2016 £000 |
11 Months up to 31 Dec 2016 £000 |
12 Months up to 31 Jan 2016 £000 |
11 Months up to 31 Dec 2016 £000 |
12 Months up to 31 Jan 2016 £000 |
11 Months up to 31 Dec 2016 £000 |
12 Months up to 31 Jan 2016 £000 |
11 Months up to 31 Dec 2016 £000 |
12 Months up to 31 Jan 2016 £000 |
|
Development |
(388) |
(1,108) |
(2,376) |
(2,279) |
(363) |
(289) |
- |
- |
- |
- |
(3,127) |
(3,676) |
|
Sales and marketing* |
(4,626) |
(3,672) |
(246) |
- |
- |
- |
|
- |
- |
- |
(4,872) |
(3,672) |
|
Operations** |
(486) |
(158) |
(116) |
(103) |
(99) |
(63) |
(308) |
(183) |
(3,141) |
(3,049) |
(4,150) |
(3,556) |
|
Administrative costs |
(5,500) |
(4,938) |
(2,738) |
(2,382) |
(462) |
(352) |
(308) |
(183) |
(3,141) |
(3,049) |
(12,149) |
(10,904) |
* Sales and Marketing for Wound Care includes the entire costs for our US entity. Included within these costs is £607k (2016: £303k) commission on sales
** Operations includes travel, finance, board, legal, premises, depreciation, share based payment charge
The Group is organised into Cardiac, Wound Care and Orthopaedics divisions for internal management, reporting and decision-making, based on the nature of the products of the Group's businesses. For the first time, controlled joint venture GBM-V has been separately analysed. Central overheads, which primarily relate to operations of the Group function are generally not allocated to the business units. These accounts have been prepared on a going concern basis and I draw the readers attention to the going concern statement in the Corporate Governance Statement and Note 1 to the financial accounts.
Wound Care
The Wound Care division remains by far the largest contributor to sales for the Group, with revenues of £1,322k for the 11-month period (January 2016: £808k), an increase of 64%. We continue to implement our dual sales strategy, utilising both direct reps and distributors for DermaPure®. We also gained significant traction toward year end with the announcement of the Premier, Inc. GPO contract; however, due to the timing of the agreement it had no material impact on these figures. Following year end, we also gained approval under Vizient, Inc, the largest member owned GPO in the US. Combined, this allows for potential access to 75% of inpatient beds and we would expect to see the results of this reflected in the next set of annual results. The launch of SurgiPure™ XD was postponed to allow for the redeployment of resources.
Gross margin for the 11 month period was 75%, in line with prior year (January 2016: 81%), and reflects the continued programme of providing evaluation units and improving market penetration. Additional product sizes have been introduced over the course of the year, adding to the product mix effect on the margin.
Development costs for the post market clinical data verification of DermaPure® charged to the P&L has decreased year on year to £388k (January 2016: £1,108k) as costs to the value of £550k were capitalised as SurgiPure™ XD received 510k clearance, reflecting the move to a commercial product. Sales and Marketing costs of £4,626k were incurred in the period (January 2016: £3,672k), which are expected to yield revenue benefits in FY17. Commissions paid in the period of £607k (January 2016: £303k) were driven by the increase in sales via the distributor channel.
Orthopaedics
Investment in Orthopaedics continued in the 11 month period with development costs of £2,376k (January 2016: £2,279k), and the recruitment of two commercial positions; a VP Orthopaedics North America to lead our entry into the US market place with human tissue derived products, and a EU Sales and Marketing Manager for Orthopaedics in preparation for the launch and commercialisation of OrthoPure™XT. Costs have also been incurred on developing marketing material in advance of the launch of product into the market. Currently, OrthoPure™ XT is expected to be launched during 2017, subject to CE mark approval.
Cardiac
The results for the year for this segment are not material. The joint venture tissue bank has however been separately reported on and is commented below. The £76k of income from prior year relates to licensing received in January 2016, which will fall into the following year as a result of the change in accounting reference date.
GBM-V
Our controlled joint venture processes our human tissue applications within Europe, and reported its first sales of £121k derived from the commercialisation of cryo-preserved corneas, it is expected that regulatory approval for dCELL® products DermaPure® and CardioPure™ (human heart valves) will be achieved by year end, with commercialisation expected in the first half of 2018. GBM-V is consolidated for accounting purposes as the accounting standards require this due to having a majority of voting rights and therefore control.
Central
Central costs in the period were £3,141k (January 2016: £3,049k), with the increase being driven by relocating all UK personnel into one premises.
Finance income
Finance income decreased to £114k (January 2016: £213k) and represents interest earned on cash deposits. The Group follows a risk-averse policy of treasury management. Cash deposits are held across a number of counter parties with institutions of prime financial standing. The Group's primary objective is to minimise exposure to potential capital losses whilst at the same time securing prevailing market rates.
Taxation
The Group continues to submit enhanced research and development tax claims and elects to exchange tax losses for a cash refund. The expected refund for the period to December 2016 is £1,034k (January 2016: £527k). Tax losses carried forward by the Group at the end of December 2016 were £32,037k (January 2016: £23,772k). The Group therefore does not expect to pay corporation tax for a number of years. Once profitable, the Group also expects to fall within the Patent Box regime and benefit from the reduced corporation tax rate within it.
Cash Balances
As at 31 December 2016 the Group had cash resources of £8,173k (January 2016: £19,907k) and was debt free. The outflow in the year of £11,734k (January 2016: £9,650k inflow after £20m financing) is driven by the cash loss attributable to operating activities.
Independent Auditor's Report
TO THE MEMBERS OF TISSUE REGENIX GROUP PLC
We have audited the financial statements of Tissue Regenix Group plc for the period ended 31 December 2016 set out on pages 30 to 55. The financial reporting framework that has been applied in their preparation is applicable law and International Financial Reporting Standards (IFRSs) as adopted by the EU and, as regards the Parent Company financial statements, as applied in accordance with the provisions of the Companies Act 2006.
This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an Auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members, as a body, for our audit work, for this report, or for the opinions we have formed.
Respective Responsibilities of Directors and Auditor
As explained more fully in the Directors' Responsibilities Statement set out on page 28, the Directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view. Our responsibility is to audit, and express an opinion on, the financial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing Practices Board's Ethical Standards for Auditors.
Scope of the Audit of the Financial Statements
A description of the scope of an audit of financial statements is provided on the Financial Reporting Council's website at www.frc.org.uk/auditscopeukprivate.
Opinion on financial statements
In our opinion:
· the financial statements give a true and fair view of the state of the Group's and of the parent company's affairs as at 31 December 2016 and of the Group's loss for the period then ended;
· the Group financial statements have been properly prepared in accordance with IFRSs as adopted by the EU;
· the parent company financial statements have been properly prepared in accordance with IFRSs as adopted by the EU and as applied in accordance with the provisions of the Companies Act 2006; and
· the financial statements have been prepared in accordance with the requirements of the Companies Act 2006.
Opinion on Other Matters Prescribed by the Companies Act 2006
In our opinion the information given in the Strategic Report and the Directors' Report for the financial year is consistent with the financial statements.
Based solely on the work required to be undertaken in the course of the audit of the financial statements and from reading the Strategic report and the Directors' report:
· we have not identified material misstatements in those reports; and
· in our opinion, those reports have been prepared in accordance with the Companies Act 2006.
Matters on Which We Are Required to Report by Exception
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
· adequate accounting records have not been kept by the Parent Company, or returns adequate for our audit have not been received from branches not visited by us; or
· the Parent Company financial statements are not in agreement with the accounting records and returns; or
· certain disclosures of Directors' remuneration specified by law are not made; or
· we have not received all the information and explanations we require for our audit.
Ian Beaumont (Senior Statutory Auditor)
for and on behalf of KPMG LLP, Statutory Auditor
Chartered Accountants
1 Sovereign Square
Leeds
LS1 4DA
2 June 2017
Consolidated Statement of Comprehensive Income
for the 11 months up to 31 december 2016
|
|
Notes |
11 Months up to 31 December 2016 £000 |
12 Months up to 31 January 2016 £000 |
|
REVENUE |
3 |
1,443 |
816 |
|
Cost of sales |
|
(354) |
(154) |
|
GROSS PROFIT |
|
1,089 |
662 |
|
Administrative expenses |
3 |
(12,149) |
(10,904) |
|
OPERATING LOSS |
4 |
(11,060) |
(10,242) |
|
Finance income |
6 |
114 |
213 |
|
LOSS BEFORE TAXATION |
|
(10,946) |
(10,029) |
|
Taxation |
7 |
1,034 |
527 |
|
LOSS FOR PERIOD |
|
(9,912) |
(9,502) |
|
|
|
|
|
|
ATTRIBUTABLE TO: |
|
|
|
|
Equity holders of the parent |
|
(9,786) |
(9,410) |
|
Non-controlling interests |
|
(126) |
(92) |
|
|
|
(9,912) |
(9,502) |
|
|
|
|
|
|
OTHER COMPREHENSIVE INCOME: |
|
|
|
|
Foreign currency translation differences - foreign operations |
|
(1) |
(1) |
|
TOTAL COMPREHENSIVE EXPENSE FOR THE PERIOD |
|
(9,913) |
(9,503) |
|
|
|
|
|
|
ATTRIBUTABLE TO: |
|
|
|
|
Equity holders of the parent |
|
(9,787) |
(9,411) |
|
Non-controlling interests |
|
(126) |
(92) |
|
|
|
(9,913) |
(9,503) |
|
|
|
|
|
|
LOSS PER SHARE |
|
|
|
|
Basic and diluted on loss attributable to equity holders of the parent |
8 |
(1.29)p |
(1.27)p |
The loss for the period arises from the Group's continuing operations.
The accompanying notes form an integral part of the financial statements.
Consolidated Statement of Changes in Equity
for the 11 months up to 31 december 2016
|
|
Attributable to equity holders of the parent |
|
|
|||||||
|
|
Share capital £000 |
Share premium £000 |
Merger reserve £000 |
Reverse acquisition reserve £000 |
Reserve for own shares £000 |
Share based payment reserve £000 |
Retained earnings deficit £000 |
Total £000 |
Non- controlling interests £000 |
Total equity £000 |
|
At 31 January 2015 |
3,271 |
31,972 |
10,884 |
(7,148) |
(831) |
810 |
(27,380) |
11,578 |
- |
11,578 |
|
Loss for the period |
- |
- |
- |
- |
- |
- |
(9,410) |
(9,410) |
(92) |
(9,502) |
|
Other comprehensive expense |
- |
- |
- |
- |
- |
- |
(1) |
(1) |
- |
(1) |
|
Loss and total comprehensive expense for the period |
- |
- |
- |
- |
- |
- |
(9,411) |
(9,411) |
(92) |
(9,503) |
|
Non-controlling interest arising on creation of a joint venture |
- |
- |
- |
- |
- |
- |
- |
- |
9 |
9 |
|
Issue of shares |
526 |
18,421 |
- |
- |
- |
- |
- |
18,947 |
- |
18,947 |
|
Exercise of share options |
4 |
68 |
- |
- |
- |
- |
- |
72 |
- |
72 |
|
Share based payment expense |
- |
- |
- |
- |
- |
136 |
- |
136 |
- |
136 |
|
At 31 January 2016 |
3,801 |
50,461 |
10,884 |
(7,148) |
(831) |
946 |
(36,791) |
21,322 |
(83) |
21,239 |
|
Loss for the period |
- |
- |
- |
- |
- |
- |
(9,786) |
(9,786) |
(126) |
(9,912) |
|
Other comprehensive expense |
- |
- |
- |
- |
- |
- |
(1) |
(1) |
- |
(1) |
|
Loss and total comprehensive expense for the period |
- |
- |
- |
- |
- |
- |
(9,787) |
(9,787) |
(126) |
(9,913) |
|
Non-controlling interest arising on creation of a joint venture |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
|
Issue of shares |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
|
Exercise of share options |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
|
Share based payment expense |
- |
- |
- |
- |
- |
210 |
- |
210 |
- |
210 |
|
At 31 December 2016 |
3,801 |
50,461 |
10,884 |
(7,148) |
(831) |
1,156 |
(46,578) |
11,745 |
(209) |
11,536 |
The accompanying notes form an integral part of the financial statements.
Consolidated Statement of Financial Position
AS AT 31 DECEMBER 2016
|
|
Notes |
As at 31 December 2016 £000 |
As at 31 January 2016 £000 |
|
ASSETS |
|
|
|
|
Non-current assets |
|
|
|
|
Property, plant and equipment |
9 |
1,087 |
901 |
|
Intangible assets |
10 |
550 |
- |
|
TOTAL NON-CURRENT ASSETS |
|
1,637 |
901 |
|
Current assets |
|
|
|
|
Inventory |
11 |
661 |
64 |
|
Trade and other receivables |
12 |
3,130 |
2,325 |
|
Cash and cash equivalents |
13 |
8,173 |
19,907 |
|
TOTAL CURRENT ASSETS |
|
11,964 |
22,296 |
|
TOTAL ASSETS |
|
13,601 |
23,197 |
|
LIABILITIES |
|
|
|
|
Current liabilities |
|
|
|
|
Trade and other payables |
14 |
(2,065) |
(1,958) |
|
TOTAL LIABILITIES |
|
(2,065) |
(1,958) |
|
NET ASSETS |
|
11,536 |
21,239 |
|
EQUITY |
|
|
|
|
Share capital |
15 |
3,801 |
3,801 |
|
Share premium |
15 |
50,461 |
50,461 |
|
Merger reserve |
15 |
10,884 |
10,884 |
|
Reverse acquisition reserve |
15 |
(7,148) |
(7,148) |
|
Reserve for own shares |
|
(831) |
(831) |
|
Share based payment reserve |
18 |
1,156 |
946 |
|
Retained earnings deficit |
16 |
(46,578) |
(36,791) |
|
EQUITY ATTRIBUTABLE TO EQUITY HOLDERS OF PARENT |
|
11,745 |
21,322 |
|
Non-controlling interests |
|
(209) |
(83) |
|
TOTAL EQUITY |
|
11,536 |
21,239 |
Approved by the Board of Directors and authorised for issue on 2 June 2017.
The accompanying notes form an integral part of the financial statements.
John Samuel
Chairman
paul devlin
Chief Financial Officer
Company number: 5969271
Consolidated Statement of Cash Flows
for the 11 months up to 31 december 2016
|
|
Notes |
11 Months up to 31 December 2016 £000 |
12 Months up to 31 January 2016 £000 |
|
Operating activities |
|
|
|
|
|
|
|
|
|
Operating loss |
|
(11,060) |
(10,242) |
|
Adjustment for: |
|
|
|
|
Depreciation of property, plant and equipment |
9 |
301 |
245 |
|
Share based payment |
18 |
210 |
136 |
|
Cash R&D tax credit received |
|
319 |
745 |
|
Operating cash outflow |
|
(10,230) |
(9,116) |
|
|
|
|
|
|
Increase in inventory |
|
(597) |
(30) |
|
Increase in trade and other receivables |
|
(90) |
(596) |
|
Increase in trade and other payables |
|
106 |
862 |
|
Net cash outflow from operations |
|
(10,811) |
(8,880) |
|
|
|
|
|
|
INVESTING ACTIVITIES |
|
|
|
|
Interest received |
6 |
114 |
213 |
|
Net cash acquired on creation of joint venture |
|
- |
9 |
|
Capitalised development expenditure |
10 |
(550) |
|
|
Purchases of property, plant and equipment |
9 |
(487) |
(711) |
|
Net cash (outflow)/inflow from investing activities |
|
(923) |
(489) |
|
|
|
|
|
|
FINANCING ACTIVITIES |
|
|
|
|
Proceeds from issue of share capital |
15 |
- |
19,019 |
|
Net cash inflow from financing activities |
|
- |
19,019 |
|
(Decrease)/increase in cash and cash equivalents |
|
(11,734) |
9,650 |
|
Cash and cash equivalents at start of period |
|
19,907 |
10,257 |
|
CASH AND CASH EQUIVALENTS AT END OF PERIOD |
|
8,173 |
19,907 |
The accompanying notes form an integral part of the financial statements.
Notes to the Financial Statements
FOR THE 11 MONTHS UP TO 31 DECEMBER 2016
1) BASIS OF PREPARATION
The financial statements of Tissue Regenix Group plc are audited consolidated financial statements for the period to 31 December 2016. These include audited comparatives for the year to 31 January 2016.
As announced in the previous annual report the Board changed the accounting year end to 31st December to bring it in line with calendar year and therefore these accounts are showing an 11 month period to the comparative 12 month fiscal year.
The Group financial statements consolidate the financial statements of Tissue Regenix Group plc and the entities it controls, its subsidiaries.
Going Concern
At 31 December 2016, cash balances were £8.2m, with an updated cash balance as of 30 April 2017 of £5.4m, which is considered sufficient to meet the needs of the business until the end of Q3 2017. It is expected that the Group's historic cash burn of c.£1m a month is representative of the cash requirements for the Group to continue its ongoing activities for not less than the following 12 months. Significant milestones have been achieved during the year, with listings in the US with GPO's (Group Purchasing Organisations) covering 75% of the US inpatient market, along with 93% Medicare coverage for outpatient use, and the addition of Tissue Regenix to the Federal Supply Schedule, all of which demonstrate the viability of the Group's commercial model. In line with the Group's business plan further funding is envisaged as the Group seeks to commercialise and develop its products.
The Directors, having taken appropriate advice, reasonably believe that additional equity funds will be committed before the end of Q3 2017, to allow the Group to continue its operations and to continue to commercialise and develop its products; accordingly, the Directors have a reasonable expectation that the Group will have adequate resources to continue in operation for the foreseeable future.
Although there can be no certainty in relation to the Group's abilities to secure such funding, the Directors have a reasonable expectation that the Group will have adequate resources to continue in operation for the foreseeable future and consider it appropriate to continue to adopt the going concern basis in preparing the financial statements..
2) SIGNIFICANT ACCOUNTING POLICIES
The consolidated financial statements have been prepared under the historical cost convention in accordance with International Financial Reporting Standards as adopted by the European Union.
The principal accounting policies applied are set out below.
Revenue
Revenue is measured as the fair value of the consideration received or receivable in the normal course of business, net of discounts, VAT and other sales related taxes and is recognised to the extent that it is probable that the economic benefits associated with the transaction will flow into the Company.
Grant income is recognised as earned based on contractual conditions, generally as expenses are incurred.
Foreign currencies
The individual financial statements of each Group entity are presented in the currency of the primary economic environment in which the entity operates (its functional currency). For the purposes of the consolidated financial statements, the results and the financial position of each Group entity are expressed in Pounds Sterling, which are the functional currency of the Company and the presentational currency for the consolidated financial statements.
In preparing the financial statements of the individual entities, transactions in currencies other than the entity's functional currency (foreign currencies) are recorded at the rates of exchange prevailing at the dates of the transactions. At each balance sheet date, monetary items denominated on foreign currencies are retranslated at the rates prevailing at the balance sheet date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing at the date when the fair value was determined.
Non-monetary items that are measured in terms of historical cost in foreign currency are not retranslated.
The assets and liabilities of foreign operations are translated using exchange rates at the balance sheet date. The components of shareholders' equity are stated at historical value. An average exchange rate for the period is used to translate the results and cash flows of foreign operations. Exchange differences arising on translating the results and net assets of foreign operations are taken to the translation reserve in equity until the disposal of the investment. The gain or loss in the income statement on the disposal of foreign operations includes the release of the translation reserve relating to the operation that is being sold.
Research and development
Research costs are charged to profit or loss as they are incurred. An intangible asset arising from development expenditure on an individual project is recognised only when all of the following criteria can be demonstrated:
· it is technically feasible to complete the product and the Company is satisfied that appropriate regulatory hurdles have been, or will be achieved;
· management intends to complete the product and use or sell it;
· there is an ability to use or sell the product;
· it can be demonstrated how the product will generate probable future economic benefits;
· adequate technical, financial and other resources are available to complete the development, use or sell the product; and
· expenditure attributable to the product can be reliably measured.
Such intangible assets are amortised on a straight-line basis from the point at which the assets are ready for use over the period of the expected benefit, and are reviewed for an indication of impairment at each reporting date. Other development costs are charged against profit or loss as incurred since the criteria for their recognition as an asset are not met.
The costs of an internally generated intangible asset comprise all directly attributable costs necessary to create, produce and prepare the asset to be capable of operating in the manner intended by management. Directly attributable costs include employee costs incurred on technical development, testing and certification, materials consumed and any relevant third party cost. The costs of internally generated developments are recognised as intangible assets and are subsequently measured in the same way as externally acquired intangible assets. However, until completion of the development project, the assets are subject to impairment testing only.
Leases
Rentals payable under operating leases, which are leases where the lessor retains a significant proportion of the risks and benefits of the asset, are charged in the statement of comprehensive income on a straight-line basis over the expected lease term.
Property, plant and equipment
Property, plant and equipment assets are stated at historical cost.
Depreciation is provided on all property, plant and equipment assets at rates calculated to write each asset down to its estimated residual value evenly over its expected useful life, as follows:
Laboratory equipment over 5 years
Computer equipment over 3 years
Fixtures and fittings: over 5 years
Impairment of property, plant and equipment and intangibles
At each reporting date, the Group reviews the carrying amounts of its property, plant and equipment and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any).
Discounted cash flow valuation techniques are generally applied for assessing recoverable amounts using three-year forward looking cash flow projections and terminal value estimates, together with discount rates appropriate to the risk of the related cash generating units.
If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount. An impairment loss is recognised as an expense immediately.
Amortisation
Amortisation of intangibles is charged to the income statement on a straight-line basis over the estimated economical useful lives of intangible assets,from product launch unless such lives are indefinite. No capitalised development costs to date have been amortised.
Share based payments
Share options
Equity settled share based payment transactions are measured with reference to the fair value at the date of grant, recognised on a straight-line basis over the vesting period, based on the Company's estimate of shares that will eventually vest. Fair value is measured using a binomial valuation model.
At each reporting date before vesting, the cumulative expense is calculated, representing the extent to which the vesting period has expired and management's best estimate of the achievement or otherwise of non-market conditions and the number of equity instruments that will ultimately vest. The movement in cumulative expense since the previous reporting date is recognised in the statement of comprehensive income, with a corresponding entry in equity.
Jointly held shares
Where an employee acquires an interest in shares in the Company jointly with the Tissue Regenix Employee Share Trust, the fair value benefit at the purchase date is recognised as an expense, with a corresponding increase to equity share based payment reserve on a straight-line basis, over the vesting period.
The fair value benefit is measured using a binomial valuation model, taking into account the terms and conditions upon which the jointly owned shares were purchased.
The expected life used in the model has been adjusted, based on management's best estimate, for the effect of non-transferability, sale restrictions, and behavioural considerations.
Financial assets and liabilities
Trade and other receivables
Trade and other receivables do not carry any interest and are initially recognised at fair value. They are subsequently measured at amortised cost using the effective interest rate method, less any provision for impairment.
Impairment provisions are recognised when there is objective evidence that the Group will be unable to collect all of the amounts due under the terms receivable, the amount of such a provision being the difference between the net carrying amount and the present value of the future expected cash flows associated with the impaired receivable.
Trade and other payables
Trade and other payables are not interest bearing and are initially recognised at fair value. They are subsequently measured at amortised cost using the effective interest method.
Cash and cash equivalents
Cash and cash equivalents comprise cash at hand and deposits on a term of not greater than 12 months.
Share capital
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax from proceeds.
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
The tax currently payable is based on taxable profit for the period. The Group's liability for current tax is calculated by using tax rates that have been enacted or substantively enacted by the reporting date.
Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amount of assets and liabilities in the financial information and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method. Deferred tax liabilities are recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised. Deferred tax is calculated at the tax rates that are expected to apply to the period when the asset is realised or the liability is settled using tax rates that have been enacted or substantively enacted by the reporting date. Deferred tax is charged or credited to profit or loss, except when it relates to items credited or charged directly to equity, in which case the deferred tax is also dealt with in equity.
Controlled Joint Venture
Tissue Regenix Group entered a joint venture in January 2016 establishing GBM-V. The figures for this entity are consolidated within these accounts due to Tissue Regenix Group having control because it owns the majority of the voting rights.
Critical accounting estimates and areas of judgement
Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Actual results may differ from these estimates. The estimates and assumptions that have the most significant effects on the carrying amounts of the assets and liabilities in the financial information are discussed below:
Equity settled share based payments
The estimation of share based payment costs requires the selection of an appropriate valuation method, consideration as to the inputs necessary for the valuation model chosen and the estimation of the number of awards that will ultimately vest. Inputs subject to judgement relate to the future volatility of the share price of comparable companies, the Group's expected dividend yields, risk free interest rates and expected lives of the options. The Directors draw on a variety of sources to aid in the determination of the appropriate data to use in such calculations. The share based payment charge for the period was £210,000 (31 January 2016: £136,000).
Capitalisation of development costs
The point at which development costs meet the criteria for capitalisation is a key judgement. During the year we capitalised development costs of £550,000 in respect of a product / products for which we received 510k clearance. We deem this to be the point at which it becomes probable that future economic benefits will be received from the product and hence the criteria for capitalisation are met. If we had not capitalised these development costs, then there would have been a further charge of £550,000 to the income statement
Accounting standards and interpretations not applied
At the date of authorisation of these financial statements, the following standards and interpretations relevant to the Group that have not been applied in these financial statements were in issue but not yet effective:
|
|
|
Effective date |
|
IFRS 9 |
Financial Instruments |
1 January 2018 |
|
IFRS 15 |
Revenue from Contracts with Customers |
1 January 2018 |
|
IFRS 16 |
Leases |
1 January 2019 |
|
Annual improvement to IAS12 |
Recognition of Deferred Tax Assets for Unrealised Losses |
1 January 2017 |
The Directors anticipate that the adoption of these Standards and Interpretations in future years will have no material impact on the financial statements of the Group.
No Standards or Interpretations adopted in the year had any material impact on the financial statements of the Group.
3) SEGMENTAL REPORTING
The following table provides disclosure of the Group's revenue by geographical market based on location of the customer:
|
|
11 Months up to 31 December 2016 £000 |
12 Months up to 31 January 2016 £000 |
|
USA |
1,322 |
808 |
|
Rest of the World |
121 |
8 |
|
|
1,443 |
816 |
Analysis of revenue by customer
During the period ending 31 December 2016 the Group had two customers who individually exceeded 10% of revenue. These customers generated 12% and 10% of revenue respectively.
Operating segments
The Group is organised into Cardiac, Wound Care, Orthopaedics and GBM-V divisions for internal management, reporting and decision-making, based on the nature of the products of the Group's businesses. Managers have been appointed within these divisions, who report to the Board. These are the reportable operating segments in accordance with IFRS 8 "Operating Segments". The Directors recognise that the operations of the Group are dynamic and therefore this position will be monitored as the Group develops.
In accordance with IFRS 8, the Group has derived the information for its operating segments using the information used by the Chief Operating Decision Maker. The Group has identified the Board of Directors as the Chief Operating Decision Maker as it is responsible for the allocation of resources to the operating segments and assessing their performance.
Central overheads, which primarily relate to operations of the Group function, are not allocated to the business units.
|
|
Wound Care |
Orthopaedics |
Cardiac |
GBMV |
Central |
Total |
||||||
|
|
11 Months up to 31 Dec 2016 £000 |
12 Months up to 31 Jan 2016 £000 |
11 Months up to 31 Dec 2016 £000 |
12 Months up to 31 Jan 2016 £000 |
11 Months up to 31 Dec 2016 £000 |
12 Months up to 31 Jan 2016 £000 |
11 Months up to 31 Dec 2016 £000 |
12 Months up to 31 Jan 2016 £000 |
11 Months up to 31 Dec 2016 £000 |
12 Months up to 31 Jan 2016 £000 |
11 Months up to 31 Dec 2016 £000 |
12 Months up to 31 Jan 2016 £000 |
|
Total segment |
1,322 |
884 |
- |
- |
- |
76 |
121 |
- |
- |
8 |
1,443 |
968 |
|
Inter-segment |
- |
(76) |
- |
- |
- |
(76) |
- |
- |
|
- |
- |
(152) |
|
Revenue |
1,322 |
808 |
- |
- |
- |
- |
121 |
- |
- |
8 |
1,443 |
816 |
|
Cost of sales |
(288) |
(154) |
- |
- |
- |
- |
(66) |
- |
- |
- |
(354) |
(154) |
|
Gross Profit |
1,034 |
654 |
- |
- |
- |
- |
55 |
- |
- |
8 |
1,089 |
662 |
|
Administrative costs |
(5,500) |
(4,938) |
(2,738) |
(2,382) |
(462) |
(352) |
(308) |
(183) |
(3,141) |
(3,049) |
(12,149) |
(10,904) |
|
Operating loss |
(4,466) |
(4,284) |
(2,738) |
(2,382) |
(462) |
(352) |
(253) |
(183) |
(3,141) |
(3,041) |
(11,060) |
(10,242) |
|
Finance income |
- |
- |
- |
- |
- |
- |
|
- |
114 |
213 |
114 |
213 |
|
Loss before taxation |
(4,466) |
(4,284) |
(2,738) |
(2,382) |
(462) |
(352) |
(253) |
(183) |
(3,027) |
(2,828) |
(10,946) |
(10,029) |
|
Taxation |
323 |
169 |
600 |
324 |
111 |
16 |
|
- |
- |
18 |
1,034 |
527 |
|
Loss for the year |
(4,143) |
(4,115) |
(2,138) |
(2,058) |
(351) |
(336) |
(253) |
(183) |
(3,027) |
(2,810) |
(9,912) |
(9,502) |
Administrative costs are broken down as follows:
|
|
Wound Care |
Orthopaedics |
Cardiac |
GMBV |
Central |
Total |
||||||
|
|
11 Months up to 31 Dec 2016 £000 |
12 Months up to 31 Jan 2016 £000 |
11 Months up to 31 Dec 2016 £000 |
12 Months up to 31 Jan 2016 £000 |
11 Months up to 31 Dec 2016 £000 |
12 Months up to 31 Jan 2016 £000 |
11 Months up to 31 Dec 2016 £000 |
12 Months up to 31 Jan 2016 £000 |
11 Months up to 31 Dec 2016 £000 |
12 Months up to 31 Jan 2016 £000 |
11 Months up to 31 Dec 2016 £000 |
12 Months up to 31 Jan 2016 £000 |
|
Development |
(388) |
(1,108) |
(2,376) |
(2,279) |
(363) |
(289) |
- |
- |
- |
- |
(3,127) |
(3,676) |
|
Sales and marketing* |
(4,626) |
(3,672) |
(246) |
- |
- |
- |
- |
- |
- |
- |
(4,872) |
(3,672) |
|
Operations** |
(486) |
(158) |
(116) |
(103) |
(99) |
(63) |
(308) |
(183) |
(3,141) |
(3,049) |
(4,150) |
(3,556) |
|
Admin costs |
(5,500) |
(4,938) |
(2,738) |
(2,382) |
(462) |
(352) |
(308) |
(183) |
(3,141) |
(3,049) |
(12,149) |
(10,904) |
* Sales and Marketing for Wound Care includes the entire costs for our US entity. Included within these costs is £607k (2016: £303k) commission on sales
** Operations includes travel, finance, board, legal, premises, depreciation, share based payment charge
Other segment information
The Group's non-current assets are predominantly held by UK entities and consequently no geographical statement of financial position disclosures are required.
4) LOSS FROM OPERATIONS
|
|
11 Months up to 31 December 2016 £000 |
12 Months up to 31 January 2016 £000 |
|
Loss from operations is stated after crediting: |
|
|
|
Grant income |
- |
- |
|
Loss from operations is stated after charging to administrative expenses: |
|
|
|
Depreciation of plant and equipment (see note 9) |
301 |
245 |
|
Operating lease rentals - land and buildings |
64 |
341 |
|
Staff costs (see note 5) |
7,026 |
4,798 |
|
Foreign exchange (gains)/losses |
(115) |
33 |
|
Research and development (inclusive of research and development personnel) |
3,127 |
3,676 |
|
Auditor's remuneration: |
|
|
|
- fees payable to Company's Auditor for the audit of the Parent Company and consolidated financial statements |
11 |
11 |
|
- auditing the accounts of subsidiaries pursuant to legislation |
20 |
18 |
|
Other services: |
|
|
|
- fees in relation to corporation tax |
41 |
27 |
|
- fees in relation to other services |
28 |
13 |
|
Total Auditor's remuneration |
100 |
69 |
5) staff costs
|
|
11 Months up to 31 December 2016 Number |
12 Months up to 31 January 2016 Number |
|
The average monthly number of persons (including Directors) employed by the Group during the period was: |
|
|
|
Directors |
7 |
6 |
|
Laboratory and administration staff |
73 |
64 |
|
|
80 |
70 |
|
|
11 Months up to 31 December 2016 £000 |
12 Months up to 31 January 2016 £000 |
|
The aggregate remuneration, including Directors, comprised: |
|
|
|
Wages and salaries |
6,036 |
4,090 |
|
Share based expense (see note 18) |
210 |
136 |
|
Social security, pension and healthcare costs |
780 |
572 |
|
|
7,026 |
4,798 |
|
Directors' remuneration included above comprised: |
|
|
|
Emoluments for qualifying services |
744 |
788 |
Directors' emoluments disclosed above include £293,000 paid to the highest paid Director (Dec 2016: £310,000) as well as share based payments benefit of £45,000 (Jan 2016: £35,000).
6) FINANCE INCOME
|
|
11 Months up to 31 December 2016 £000 |
12 Months up to 31 January 2016 £000 |
|
Bank interest receivable |
114 |
213 |
7) TAXATION
Tax on loss on ordinary activities
|
|
11 Months up to 31 December 2016 £000 |
12 Months up to 31 January 2016 £000 |
|
Current tax: |
|
|
|
UK corporation tax credit on losses of period |
(1,034) |
(527) |
|
|
(1,034) |
(527) |
|
Deferred tax: |
|
|
|
Origination and reversal of temporary timing differences |
- |
- |
|
Tax credit on loss on ordinary activities |
(1,034) |
(527) |
The charge for the period can be reconciled to the loss before tax per the Statement of Comprehensive Income as follows:
Factors affecting the current tax charges
The tax assessed for the period varies from the small company rate of corporation tax as explained below:
|
|
11 Months up to 31 December 2016 £000 |
12 Months up to 31 January 2016 £000 |
|
The tax assessed for the year varies from the small company rate of corporation tax as explained below: |
|
|
|
Loss on ordinary activities before tax |
(10,946) |
(10,029) |
|
Tax at the standard rate of corporation tax 20% |
(2,189) |
(2,006) |
|
Effects of: |
|
|
|
Expenses not deductible for tax purposes |
- |
27 |
|
Research and development tax credits received |
(875) |
(492) |
|
Surrender of research and development relief for repayable tax credit |
1,249 |
679 |
|
Research and development enhancement |
(706) |
(377) |
|
Prior year adjustment |
(158) |
(35) |
|
Unutilised tax losses |
1,645 |
1,677 |
|
Tax credit for the period |
(1,034) |
(527) |
Deferred Tax
|
|
11 Months up to 31 December 2016 £000 |
12 Months up to 31 January 2016 £000 |
|
Tax losses |
|
|
|
Losses available to carry forward against future trading profits |
32,037 |
23,772 |
|
Deferred tax asset - unrecognised* |
5,767 |
4,279 |
* The Company has not recognised a deferred tax asset relating to these losses as their recoverability is uncertain.
8) LOSS PER SHARE (BASIC AND DILUTED)
Basic loss per share is calculated by dividing the loss attributable to equity holders of the parent by the weighted average number of ordinary shares in issue during the period excluding own shares held jointly by the Tissue Regenix Employee Share Trust and certain employees. Diluted loss per share is calculated by adjusting the weighted average number of ordinary shares in issue during the period to assume conversion of all dilutive potential ordinary shares.
|
|
11 Months up to 31 December 2016 £000 |
12 Months up to 31 January 2016 £000 |
|
Total loss attributable to the equity holders of the parent |
(9,787) |
(9,411) |
|
|
No. |
No. |
|
Weighted average number of ordinary shares in issue during the period |
760,124,264 |
743,183,878 |
|
|
|
|
|
Loss per share |
|
|
|
Basic and diluted on loss for the period |
(1.29)p |
(1.27)p |
The Company has issued employee options over 12,883,285 ordinary shares and there are 16,940,386 jointly owned shares which are potentially dilutive. There is however, no dilutive effect of these issued options as there is a loss for each of the periods concerned.
9) PROPERTY, PLANT AND EQUIPMENT
|
|
Laboratory equipment £000 |
Fixtures and fittings £000 |
Computer equipment £000 |
Total £000 |
|
Cost |
|
|
|
|
|
At 31 January 2015 |
742 |
53 |
133 |
928 |
|
Additions |
198 |
357 |
156 |
711 |
|
At 31 January 2016 |
940 |
410 |
289 |
1,639 |
|
Additions |
158 |
124 |
205 |
487 |
|
At 31 December 2016 |
1,098 |
534 |
494 |
2,126 |
|
|
|
|
|
|
|
Depreciation |
|
|
|
|
|
At 31 January 2015 |
357 |
41 |
95 |
493 |
|
Charge for the period |
149 |
61 |
35 |
245 |
|
At 31 January 2016 |
506 |
102 |
130 |
738 |
|
Charge for the period |
132 |
84 |
85 |
301 |
|
At 31 December 2016 |
638 |
186 |
215 |
1,039 |
|
|
|
|
|
|
|
Net book value |
|
|
|
|
|
At 31 December 2016 |
460 |
348 |
279 |
1,087 |
|
At 31 January 2016 |
434 |
308 |
159 |
901 |
|
At 31 January 2015 |
385 |
12 |
38 |
435 |
10) INTANGIBLES
|
|
As at 31 December 2016 £000 |
As at 31 January 2016 £000 |
|
Development costs |
550 |
- |
|
Total |
550 |
- |
11) INVENTORY
|
|
As at 31 December 2016 £000 |
As at 31 January 2016 £000 |
|
Raw materials and consumables |
126 |
- |
|
Work in progress |
74 |
- |
|
Finished goods including goods for resale |
461 |
64 |
|
Total |
661 |
64 |
The replacement cost of stocks approximates to the value at which they are stated in the accounts.
12) TRADE AND OTHER RECEIVABLES
|
|
As at 31 December 2016 £000 |
As at 31 January 2016 £000 |
|
Trade debtors |
427 |
398 |
|
Other receivables |
2,231 |
1,464 |
|
Prepayments and accrued income |
472 |
463 |
|
|
3,130 |
2,325 |
The Directors consider that the carrying amount of trade and other receivables approximates to their fair value.
Trade debtors is reduced due to a provision valued at £90k (Jan 2016: £nil).
At year end £63K of the trade debtors value is past due that has no provision against (Jan 2016: £132K)
Trade debtors, split by the currency they will be settled, are shown below:
|
|
As at 31 December 2016 £000 |
As at 31 January 2016 £000 |
|
US Dollars |
339 |
398 |
|
Euros |
88 |
- |
|
Trade debtors |
427 |
398 |
13) RISK MANAGEMENT OF FINANCIAL ASSETS AND LIABILITIES
The Company's activities expose it to a variety of financial risks: market risk, specifically interest rate risk; credit risk; and liquidity risk. The Company's overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Company's financial performance.
The management of these risks is vested in the Board of Directors. The policies for managing each of these risks are summarised below:
Management of market risk
i) Interest rate risk
As the Company has no significant borrowings the risk is limited to the potential reduction in interest received on cash surpluses held. Interest rate risk is managed in accordance with the liquidity requirement of the Group, with a minimal amount of its cash surpluses held within short term accounts, which have variable interest rates attributable to them, to ensure that sufficient funds are available to cover the working capital requirements of the Company.
Interest rate sensitivity
The principal impact to the Company is the result of interest bearing cash and cash equivalent balances held as set out below:
|
|
December 2016 |
||
|
|
Fixed rate £000 |
Floating rate £000 |
Total £000 |
|
Cash and cash equivalents |
7,654 |
519 |
8,173 |
|
|
January 2016 |
||
|
|
Fixed rate £000 |
Floating rate £000 |
Total £000 |
|
Cash and cash equivalents |
18,725 |
1,182 |
19,907 |
Due to the high proportion of funds held on a fixed deposit, the impact of a 5% increase/decrease in interest rates would have an immaterial impact on the loss in each period.
Management of credit risk
The Company is exposed to credit risk from its operating activities; this principally arises from short term bank deposits. The Company seeks to minimise this risk by only depositing funds with banks with a high credit rating.
The maximum exposure to credit risk on the Company's financial assets is represented by their carrying amounts as outlined in the categorisation of financial instruments table below.
The Company does not consider that any changes in fair value of financial assets or liabilities in the year are attributable to credit risk.
Management of liquidity risk
The Company seeks to manage liquidity risk to ensure that sufficient liquidity is available to meet foreseeable needs and to invest cash assets safely and profitably.
No maturity analysis for financial liabilities is presented, as the Directors consider that liquidity risk is not material.
The Company had cash and cash equivalents at each reporting date as is set out below.
|
|
As at 31 December 2016 £000 |
As at 31 January 2016 £000 |
|
Cash and cash equivalents |
|
|
|
AA- |
16 |
29 |
|
A |
7,654 |
18,725 |
|
BBB+ |
503 |
1,153 |
|
|
8,173 |
19,907 |
The above has been split by the Fitch rating system and gives an analysis of the credit rating of the financial institutions where cash balances are held.
Capital risk management
The Company manages its capital to ensure that the Company will be able to continue as a going concern while maximising the return to stakeholders. The Company's overall strategy is to minimise costs and liquidity risk.
The capital structure of the Company consists of equity attributable to the owners of the Company, comprising issued capital, reserves and retained earnings as disclosed in notes 15 and 16 and in the Statement of Changes in Equity.
Categorisation of financial instrument
|
Financial assets/(liabilities) |
Loans and receivables £000 |
Financial liabilities at amortised cost £000 |
Total £000 |
|
At 31 December 2016 |
|
|
|
|
Trade and other receivables |
2,658 |
- |
2,658 |
|
Cash and cash equivalents |
8,173 |
- |
8,173 |
|
Trade and other payables |
- |
(765) |
(765) |
|
|
10,831 |
(765) |
10,066 |
|
Financial assets/(liabilities) |
Loans and receivables £000 |
Financial liabilities at amortised cost £000 |
Total £000 |
|
At 31 January 2016 |
|
|
|
|
Trade and other receivables |
1,862 |
- |
1,862 |
|
Cash and cash equivalents |
19,907 |
- |
19,907 |
|
Trade and other payables |
- |
(573) |
(573) |
|
|
21,769 |
(573) |
21,196 |
The Company had no financial instruments measured at fair value.
14) TRADE AND OTHER PAYABLES
|
|
As at 31 December 2016 £000 |
As at 31 January 2016 £000 |
|
Trade payables |
618 |
501 |
|
Taxes and social security |
147 |
72 |
|
Accruals |
1,300 |
1,385 |
|
|
2,065 |
1,958 |
The Directors consider that the carrying amount of trade and other payables approximates to their fair value.
Trade payables, split by the currency they will be settled in, are shown below:
|
|
As at 31 December 2016 £000 |
As at 31 January 2016 £000 |
|
Sterling |
150 |
170 |
|
US Dollars |
332 |
242 |
|
Euros |
136 |
89 |
|
Trade payables |
618 |
501 |
15) SHARE CAPITAL
|
|
Number |
Share capital £000 |
Share premium £000 |
Merger reserve £000 |
Reverse acquisition reserve £000 |
Total £000 |
|
Total ordinary shares of 0.5 p each as at 31 January 2015 |
654,123,031 |
3,271 |
31,972 |
10,884 |
(7,148) |
38,979 |
|
Issue of shares |
105,263,158 |
526 |
18,421 |
- |
- |
18,947 |
|
Share options exercised |
738,075 |
4 |
68 |
- |
- |
72 |
|
Total ordinary shares of 0.5p each as at 31 January 2016 |
760,124,264 |
3,801 |
50,461 |
10,884 |
(7,148) |
57,998 |
|
Issue of shares |
- |
- |
- |
- |
- |
- |
|
Share options exercised |
- |
- |
- |
- |
- |
- |
|
Total ordinary shares of 0.5p each as at 31 January 2016 |
760,124,264 |
3,801 |
50,461 |
10,884 |
(7,148) |
57,998 |
As permitted by the provisions of the Companies Act 2006, the Company does not have an upper limit to its authorised share capital.
16) MOVEMENT IN RETAINED EARNINGS AND RESERVE FOR OWN SHARES
|
|
Retained earnings deficit £000 |
Reserve for own shares £000 |
|
At 31 January 2016 |
(36,791) |
(831) |
|
Loss for the period |
(9,912) |
- |
|
Exchange movement |
(1) |
- |
|
Minority interest |
126 |
- |
|
At 31 December 2016 |
(46,578) |
(831) |
17) COMMITMENTS
Operating lease commitments
The Group leases premises under non-cancellable operating lease agreements. The future aggregate minimum lease and service charge payments under non-cancellable operating leases are as follows:
|
|
As at 31 December 2016 £000 |
As at 31 January 2016 £000 |
|
Land and buildings: |
|
|
|
Amounts due within one year |
64 |
124 |
18) SHARE BASED PAYMENTS
Share options and shares held in employee benefit trust ("EBT")
The Company operates a share option plan, under which certain employees have been granted options to subscribe for ordinary shares. All options are equity settled. The options have an exercise price of between 0.5p to 22.5p and a vesting period between one and three years. If the options remain unexercised after a period of ten years from the date of grant, the options expire. The Group has no legal or constructive obligation to repurchase or settle the options in cash.
The Group also operates a jointly owned EBT share scheme for senior management, under which the trustee of the Group sponsored EBT has acquired shares in the Group jointly with a number of employees. The shares were acquired pursuant to certain conditions, set out in Jointly Owned Equity agreements ("JOEs"). Subject to meeting the performance criteria conditions set out in the JOEs, the employees are able to benefit from most of any future increase in the value of the jointly owned EBT shares. The fair value benefit is measured using the binomial model, taking into account the terms and conditions upon which the jointly owned shares were purchased.
The number and weighted average exercise prices of share options and EBT shares are as follows:
|
|
Number of share interests |
Weighted average exercise price per share (£) |
|||
|
EMI options |
Unapproved options |
EBT shares |
Total |
||
|
At 31 January 2015 |
16,532,091 |
5,424,377 |
16,940,386 |
38,896,854 |
0.0706 |
|
Exercised in the period |
(53,328) |
(684,748) |
- |
(738,076) |
0.0974 |
|
Lapsed during the period |
(822,222) |
(222,254) |
- |
(1,044,476) |
0.1407 |
|
Issued in the period |
1,430,839 |
2,939,098 |
- |
4,369,937 |
0.1238 |
|
At 31 January 2016 |
17,087,380 |
7,456,473 |
16,940,386 |
41,484,239 |
0.0657 |
|
Exercised in the period |
- |
- |
- |
- |
- |
|
Lapsed during the period |
(160,008) |
(1,431,905) |
- |
(1,591,913) |
0.0368 |
|
Issued in the period |
- |
5,094,124 |
- |
5,094,124 |
0.0507 |
|
At 31 December 2016 |
16,927,372 |
11,118,692 |
16,940,386 |
44,986,450 |
0.0650 |
There were 17,199,750 share options outstanding at 31 December 2016 which was eligible to be exercised. The remaining options were not eligible to be exercised as these are subject to employment period and market based vesting conditions, some of which had not been met at 31 December 2016.
The performance conditions in relation to these options allows for vesting in three equal proportions on or after the three consecutive annual anniversaries from the date of grant subject to the Company's share price reaching certain hurdle values by the respective vesting dates.
There were 16,940,386 of the jointly held EBT shares which were eligible to vest as at 31 December 2016.
The fair value benefit received on share options granted is measured using the binomial model taking in to account the effects of the vesting and performance conditions, expected exercise price and the payment of the dividends by the Company. The fair value benefits received on EBT shares are measured using the Binomial model, taking into account the terms and conditions upon which the jointly owned shares were purchased. The following table lists the inputs to the models used:
|
|
Options |
EBT shares |
Options |
|
|
Granted year to 31 December 2016 |
Granted year to 31 December 2016 |
Granted year to 31 January 2016 |
|
Dividend yield |
- |
- |
- |
|
Expected volatility |
45% |
- |
47% |
|
Risk-free interest rate (%) |
0.9 |
- |
0.9 |
|
Expected vesting life of EBT shares and options (years) |
4 |
- |
4 |
|
Weighted average share price (£) |
0.0507 |
- |
0.1238 |
Share options issued under the DAB scheme which are not exercised within four years from the date of grant will expire. Any other share options and employee interests in jointly owned EBT shares which are not exercised within ten years from the date of grant will expire.
A charge has been recognised in the Statement of Comprehensive Income for each year as follows:
|
|
11 Months up to 31 December 2016 £000 |
12 Months up to 31 January 2016 £000 |
|
Share options |
210 |
136 |
|
Jointly owned shares |
- |
- |
|
Total share based payments |
210 |
136 |
19) RELATED PARTY TRANSACTIONS
Trading transactions with:
|
|
11 Months up to 31 December 2016 £000 |
12 Months up to 31 January 2016 £000 |
|
Transactions with significant shareholders: |
|
|
|
Patent support costs |
- |
28 |
Transactions with key management personnel
The Company's key management personnel comprise only the Directors of the Company.
During the year the Company entered into the following transactions in which the Directors had an interest:
Directors' remuneration:
Remuneration received by the Directors from the Company is set out below:
|
|
11 Months up to 31 December 2016 £000 |
12 Months up to 31 January 2016 £000 |
|
Short term employment benefits* |
744 |
694 |
* In addition, certain Directors hold share options and jointly owned shares in the Company for which a fair value share based charge of £72,000 has been recognised in the Consolidated Statement of Comprehensive Income (Jan 2016: £94,000).
During the period ended 31 December 2016, the Company entered into numerous transactions with its subsidiary company which net off on consolidation - these have not been shown above.
20) ULTIMATE CONTROLLING PARTY
The Directors believe that there is no ultimate controlling party.
Company Statement of Changes in Equity
for the 11 months up to 31 December 2016
|
|
Attributable to the equity holders of the Company |
|||||
|
|
Share capital £000 |
Share premium £000 |
Merger reserve £000 |
Share based payment reserve £000 |
Retained earnings reserve £000 |
Total £000 |
|
At 31 January 2015 |
3,271 |
31,972 |
10,884 |
737 |
(6,324) |
40,540 |
|
Total expense and other comprehensive loss for the period |
- |
- |
- |
- |
(1,203) |
(1,203) |
|
Issue of shares |
526 |
18,421 |
- |
- |
- |
18,947 |
|
Share options exercised |
4 |
68 |
- |
- |
- |
72 |
|
Share based payment expense |
- |
- |
- |
136 |
- |
136 |
|
At 31 January 2016 |
3,801 |
50,461 |
10,884 |
873 |
(7,527) |
58,492 |
|
Total expense and other comprehensive loss for the period |
- |
- |
- |
- |
(1,701) |
(1,701) |
|
Issue of shares |
- |
- |
- |
- |
- |
- |
|
Share options exercised |
- |
- |
- |
- |
- |
- |
|
Share based payment expense |
- |
- |
- |
210 |
- |
210 |
|
At 31 December 2016 |
3,801 |
50,461 |
10,884 |
1,083 |
(9,228) |
57,001 |
The accompanying notes form an integral part of the financial statements.
Company Statement of Financial Position
as at 31 DECEMBER 2016
|
|
Notes |
As at 31 December 2016 £000 |
As at 31 January 2016 £000 |
|
ASSETS |
|
|
|
|
Non-current assets |
|
|
|
|
Investments |
C3 |
12,922 |
12,922 |
|
Total non-current assets |
|
12,922 |
12,922 |
|
Current assets |
|
|
|
|
Trade and other receivables |
C4 |
63 |
60 |
|
Intercompany loan balance |
C5 |
36,531 |
26,230 |
|
Cash and cash equivalents |
|
7,819 |
19,598 |
|
|
|
44,413 |
45,888 |
|
TOTAL ASSETS |
|
57,335 |
58,810 |
|
LIABILITIES |
|
|
|
|
Current liabilities |
|
|
|
|
Trade and other payables |
C6 |
(334) |
(318) |
|
TOTAL LIABILITIES |
|
(334) |
(318) |
|
NET ASSETS |
|
57,001 |
58,492 |
|
EQUITY |
|
|
|
|
Share capital |
15 |
3,801 |
3,801 |
|
Share premium |
15 |
50,461 |
50,461 |
|
Merger reserve |
15 |
10,884 |
10,884 |
|
Share based payment reserve |
18 |
1,083 |
873 |
|
Retained earnings deficit |
|
(9,228) |
(7,527) |
|
TOTAL EQUITY |
|
57,001 |
58,492 |
Approved by the Board of Directors and authorised for issue on 2 June 2017.
The accompanying notes form an integral part of the financial statements.
John Samuel
Chairman
paul Devlin
Chief Financial Officer
Company number: 5969271
Company Statement of Cash Flows
for the 11 months up to 31 December 2016
|
|
Notes |
11 Months up to 31 December 2016 £000 |
12 Months up to 31 January 2016 £000 |
|
Operating activities |
|
|
|
|
Loss before interest and tax |
|
(1,815) |
(1,416) |
|
Adjustment for non-cash items: |
|
|
|
|
Share based payments |
18 |
210 |
136 |
|
Operating cash outflow |
|
(1,605) |
(1,280) |
|
Increase in trade and other receivables |
|
(3) |
(20) |
|
Increase in trade and other payables |
|
16 |
50 |
|
Net cash generated from operations |
|
(1,592) |
(1,250) |
|
INVESTING ACTIVITIES |
|
|
|
|
Interest received |
|
114 |
213 |
|
Loan to subsidiary undertaking |
C5 |
(10,301) |
(8,349) |
|
Net cash generated from investing activities |
|
(10,187) |
(8,136) |
|
FINANCING ACTIVITIES |
|
|
|
|
Proceeds from issue of share capital |
15 |
- |
19,019 |
|
Net cash used in financing activities |
|
- |
19,019 |
|
DECREASE IN CASH AND CASH EQUIVALENTS |
|
(11,779) |
9,633 |
|
Cash and cash equivalents at start of period |
|
19,598 |
9,965 |
|
CASH AND CASH EQUIVALENTS AT END OF PERIOD |
|
7,819 |
19,598 |
The accompanying notes form an integral part of the financial statements.
Notes to the Company Information
FOR THE 11 MONTHS UP TO 31 DECEMBER 2016
C1. Principal accounting policies
The separate financial statements of the Company are presented as required by the Companies Act 2006 and in accordance with IFRS.
The principal accounting policies adopted is the same as for those set out in the Group's financial statements.
C2. Company results
The Company has elected to take the exemption under section 408 of the Companies Act 2006 not to present the Parent Company's statement of comprehensive income. The Parent Company's result for the period ended 31 December 2016 was a loss of £1,701k (2016: £1,203k).
The audit fee for the Company is set out in note 4 of the Group's financial statements.
C3. Investment in subsidiary companies
At 31 December 2016, the Company held the following investments in subsidiaries:
|
|
|
Share of issued capital |
|
|
Undertaking |
Sector |
2016 |
2016 |
|
Tissue Regenix Limited |
Regenerative medicine |
100% |
100% |
|
TRx Wound Care Limited |
Regenerative medicine |
100% |
100% |
|
TRx Orthopaedics Limited |
Regenerative medicine |
100% |
100% |
|
TRx Cardiac Limited |
Regenerative medicine |
100% |
100% |
|
TRx Vascular Limited |
Regenerative medicine |
100% |
100% |
|
Tissue Regenix Wound Care Inc* |
Regenerative medicine |
100% |
100% |
|
TRx Orthopedic Inc* |
Regenerative medicine |
100% |
100% |
|
GBM-V GmbH |
Regenerative medicine |
50% |
50% |
* Held through TRx Wound Care Limited
Registered Addresses:
Tissue Regenix Limited, TRx Wound Care Limited, TRx Orthopaedics Limited, TRx Cardiac Limited, TRx Vascular Limited:
Unit 1 & 2, Astley Way, Astley Lane Industrial Estate, Swillington, Leeds, LS26 8XT
Tissue Regenix Wound Care Inc, TRx Orthopedic Inc:
2611 North Loop, 1604 West Suite 201, San Antonio, Texas, 78258
GBM-V Gmbh:
Wilhelm-Külz-Platz 3. 18055 Rostock
|
|
31 December 2016 £000 |
31 January 2016 £000 |
|
Cost |
|
|
|
At 1 January |
14,707 |
14,707 |
|
Additions |
- |
- |
|
At 31 December |
14,707 |
14,707 |
|
Impairment |
|
|
|
At 1 January |
(1,785) |
(1,785) |
|
At 31 December |
(1,785) |
(1,785) |
|
Carrying value at 31 December |
12,922 |
12,922 |
C4. Trade and other receivables
|
|
As at 31 December 2016 £000 |
As at 31 January 2016 £000 |
|
Prepayments and accrued income |
39 |
40 |
|
Other debtors |
24 |
20 |
|
|
63 |
60 |
C5. Current assets
|
|
As at 31 December 2016 £000 |
As at 31 January 2016 £000 |
|
Intercompany loan |
36,531 |
26,230 |
A loan of £36,531 was advanced to other subsidiary companies in the period. No interest was payable on the loan and is payable on demand
C6. Trade and other payables
|
|
As at 31 December 2016 £000 |
As at 31 January 2016 £000 |
|
Trade creditors |
58 |
8 |
|
Taxes and social security |
88 |
23 |
|
Accruals |
188 |
287 |
|
|
334 |
318 |
This information is provided by RNS
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