Preliminary Results
Alliance Pharma PLC
23 March 2006
FOR IMMEDIATE RELEASE 23 MARCH 2006
ALLIANCE PHARMA PLC
('Alliance Pharma' or 'the Company')
Preliminary Results for the 10 month period ended 31 December 2005
Alliance Pharma plc (AIM: APH), the emerging speciality pharmaceutical company,
is pleased to announce its preliminary results for the ten month period ended 31
December 2005. The results cover a 10 month period owing to a change to the
Company's year end to 31 December 2005, bringing the Company's year end into
line with that of its peers.
Financial Highlights
• Sales for the 10 month period of £12.28 million (12 months to 31
December 2004: £11.83m)
• Sales growth on an annualised basis of 24.6%
• Gross margin improvement to 54.3% (2004: 52.4%)
• Operating cashflow remains strong at £1.79 million (2004: £1.57m)
• Earnings before interest and tax of £2.17 million (2004: £2.26m)
• Pre-tax profit of £0.66 million (2004: £0.41m)
Operational Highlights
• Launch of Dental Products division and promotion of Periostat for
periodontitis
• Launch of International Division for marketing of Periostat and
Forceval
• Start of Phase III clinical trials of Posidorm for sleep disorders
• Acquisition of Hydromol dermatology range post the year end
Commenting on the results, Michael Gatenby, Alliance Pharma's Chairman, said: '
During the period under review, Alliance has moved closer to its goal of
delivering substantial and growing revenue streams from brands both acquired and
developed in-house. All our efforts will continue to be directed towards
achieving this goal.'
For further information:
Alliance Pharma plc + 44 (0) 1249 466966
John Dawson, Chief Executive
Maddy Scott, Finance Director
www.alliancepharma.co.uk
Buchanan Communications + 44 (0) 20 7466 5000
Mark Court/Lisa Baderoon/Rebecca Skye Dietrich
Notes to editors
About Alliance Pharma
Alliance Pharma, founded in 1996, is an AIM listed emerging speciality
pharmaceutical company based in Chippenham, Wiltshire, UK. The company has a
strong track record of acquiring the rights to established niche brands and
owns, or shares, the rights to 30 branded pharmaceutical products and continues
to explore opportunities to expand the range.
Alliance Pharma's products are prescribed in the treatment of a wide range of
conditions and include brands used in periodontitis (a serious gum disease), the
prevention of heart disease, in Parkinson's disease, in nutrition, in nasal
infections, in the treatment of dermatological conditions and in childbirth.
Alliance Pharma's sales are mainly prescription driven. Its products are
distributed to hospitals directly and to pharmaceutical wholesalers which
service both hospital and retail pharmacies with their prescription
requirements.
Alliance Pharma is also developing novel products for sleep disorders and the
induction of labour.
Alliance Pharma joined the AIM market of the London Stock Exchange in December
2003 and trades under the symbol APH.
Chairman's Statement
OVERVIEW
During 2005, the Company has made considerable progress, reinforcing the
attractiveness of the Company's business model in which the cashflow from the
Company's portfolio of prescription products is being used towards funding
potentially transformational though relatively low risk opportunities. The
prescription product portfolio comprises Core Brands, which have enjoyed stable
and predictable sales over many years, and Growth Brands which offer, given the
appropriate level of promotional investment, significant growth.
We have made progress across our business in the period under review, in terms
of broadening our routes to market and entering new geographic regions via
distribution and co-promotional agreements; strengthening our management in
areas such as regulatory affairs; and forming new divisions to spearhead our
involvement in the dental and international markets. The selective acquisition
of reputable prescription brands remains a key part of our strategy and I am
pleased to report that we have made further strategic acquisitions since the
year end.
DEVELOPMENT PROJECTS
During the period, we have made significant progress with our development
projects, particularly with the commencement in July of Phase III trials in the
UK of Posidorm(TM), our novel therapy for sleep disorders. The Phase III trials
focus on the use of the drug, a synthesised version of the naturally occurring
hormone that controls the sleep/wake cycle, on two patient groups: the elderly
and shift workers. Posidorm is a very substantial opportunity for the Company
as it addresses a market currently estimated at £0.5 billion but which is
expected to treble in the next decade.
Our Phase III clinical trials on Isprelor(TM), our intra-vaginal misoprostol for
induction of labour, opened in January with the expectation that they would be
completed during 2005. Site set-ups were prolonged and patient recruitment has
been slower than planned. To address this, the number of sites is currently
being expanded and the trials are now expected to be completed in the second
half of 2006, with the product's launch taking place in 2007. This product has
already attracted significant professional interest on an international scale.
PEOPLE
We have made a series of important senior appointments during the period under
review and post the period end. Glynys Davies, an experienced dental sector
sales and marketing executive, was appointed in April 2005 as head of Alliance
Pharma's Dental Products Division. At the same time, Alexander Scholtens Weert,
an executive with considerable international marketing experience, was appointed
as head of the Company's International Division. In September 2005, Dr Veronica
Farrell-Lecomte joined the Company as Director of Regulatory Affairs.
FINANCIAL
As indicated at the time of our Interim announcement, we have changed our
financial year end from February 28 to December 31, with the result that the
financial year just ended was a ten month period. Thus, comparisons with the
previous year are not straightforward; however, on an annualised basis our sales
of £12.3 million represented an increase of some 24.6%. Also, at 54.3%, our
gross margin continues to rise and was more than one percentage point above the
comparable figure for last year. Of the sales growth, some 20.0% was attributed
to the acquisition in November 2004 of Forceval, a prescription multivitamin,
and Periostat, a treatment for severe gum disease. Across the rest of our brand
portfolio, both the Core and Growth sectors performed well and in line with
expectations.
Profit after tax on an IFRS basis was £0.66 million - an increase of 62.1% over
the previous (12 month) period. This was a creditable performance for the 10
month period, particularly as the underlying business growth was held back by
two special factors. First we are already bearing substantial revenue costs in
respect of our development projects; and secondly the results were adversely
affected by the one-off price decrease imposed by the NHS in January 2005,
although we hope this will give us price stability up to 2011.
OUTLOOK
In summary, this has been a year of challenges successfully met, which has taken
Alliance closer to its goal of establishing substantial and growing revenue
streams from brands, both acquired and developed in-house. All our effort will
continue to be directed to advance this during the current year.
Michael Gatenby
Chairman
22 March 2006
Chief Executive Review
STRATEGIC OVERVIEW
The 10 months to 31 December 2005, our second year as a publicly quoted company,
have in many respects been a period during which the foundations of the Company
were strengthened to support the growth of the Company in the current year and
beyond. The Company has developed both in breadth and in depth, particularly in
terms of improvements in infrastructure. This momentum has been maintained post
the period end, notably with the acquisition of the Hydromol range of prescribed
dermatology products in February 2006.
It was also a period that provided further evidence of the robustness of
Alliance's business model and the strength of the Company's core skills.
These skills are highlighted by our first year achievements with Periostat and
Forceval, both of which were acquired in November 2004.
Periostat is a treatment for the severe gum disease periodontitis, which was
acquired for regions outside North America for $3.3 million. Following the
launch of our promotional activities in August 2005, Periostat sales responded
such that in the fourth quarter of 2005 they were averaging £33,000 per month
compared to £24,000 for the first half of the year, an increase of 37.5%,
indicating a successful promotional launch in the UK. We have built a dental
division around the product and have begun to roll out the product in regions
outside the UK. Periostat, as the first and only approved prescription medicine
for the chronic, adjunctive treatment of periodontitis, has significant growth
potential for the Company. Indeed when one considers that more than 3 million
adults in the UK suffer from periodontitis, we take enormous encouragement from
the initial response to our promotional campaigns and look forward eagerly to
reaping the rewards of our decision to acquire the brand and invest in it. In
brief Periostat shows our ability to find the right acquisition, to agree
commercially favourable terms, to create the appropriate infrastructure and then
to promote the product effectively to develop the sales potential.
Forceval, a prescribed nutritional supplement, was acquired for £7.0 million
from the Administrators of Unigreg Ltd for all territories apart from China.
Consistent customer care has led to the turnaround of the brand such that sales
were 39.9% higher than the previous 12 months.
This formula is reproducible. We are continually seeking and evaluating new
opportunities but completing deals only when they make sense commercially and
financially. Our track record speaks for itself: including Hydromol, we have
successfully completed nine acquisitions in eight years.
With the combination of developments such as Posidorm and the ongoing capability
to build up the business base, Alliance has created a low risk growth strategy
with considerable upside potential.
PROGRESS IN 2005
Sales
Sales progress has been very pleasing indeed. For the ten month period to
December 2005 sales were £12.28 million, compared to £11.83 million for the
twelve months to February 2005.
On an annualised basis, sales for the 10 month period ended 31 December 2005
represented growth of 24.6% over the 12 months to February 2005. Had it not been
for the 7% price decrease imposed from January 2005 in the UK under the
Pharmaceutical Price Regulation Scheme 2005 (PPRS), sales for the twelve months
to December 2005 would have grown by 33.7% and exceeded £15 million. It is very
reassuring to know that our past strategic measures have enabled us to absorb
this decrease and still report an extremely credible growth rate. Unwelcome and
unjustified though this PPRS price decrease was, it does mean that we can plan
in confidence that our UK prices are now secure until 2011.
Sales of Symmetrel, our specialist product for Parkinson's disease, continued
their upward trend growing by 18.7% to £1.56 million for the twelve months ended
December 2005.
Similarly sales of Nu-Seals, our enteric coated low dose aspirin achieved sales
of £3.36 million with 6.8% growth in the Republic of Ireland, where the brand
was promoted for part of the year.
Our dermatology portfolio recorded sales of £1.75 million for the twelve months
to December 2005, showing nominal growth over the same period in 2004 of 1.0%.
However for competitive reasons our dermatology portfolio bore an over-weighted
share of the PPRS price decrease; at constant prices the real growth would have
been 9.2% which has been achieved by the careful execution of a minimal
promotional investment.
As mentioned earlier we are pleased with Periostat's growth since August 2005.
In the twelve months to December 2005 we achieved sales of £311,000, which was
considerably higher than that achieved by the previous stewards of the brand.
Equally pleasing was the turnaround achieved on Forceval, our nutritional
supplement acquired from the Administrators of Unigreg Ltd in November 2004.
The £2.42 million achieved for the twelve months to December 2005 compares
favourably with £1.73 million for the twelve months to December 2004,
representing growth of 40.0%.
Our Core Brands, which we do not promote, and which provide cash towards our
expansionary projects, remained stable as expected.
Looking forward we take justified confidence from a strong and growing portfolio
of quality brands which provides us with numerous growth opportunities on the
one hand and inherent stability on the other.
Development pipeline
Our two products in Phase III clinical trials - Posidorm for sleep disorders and
Isprelor for induction of labour - each made substantial progress during the
period under review.
Posidorm is a controlled release tablet containing a synthesised version of the
naturally occurring hormone melatonin, which regulates the sleep/wake cycle and
whose deficiency is the main cause of many sleep disorders. It presents a major
commercial opportunity for Alliance as around 20 million people throughout
Europe suffer from melatonin related sleep disorders.
In July 2005 we began Phase III trials in two groups of patients in whom
previous research in the medical literature has shown melatonin to be of
benefit. These are a) elderly patients reporting problems with sleeping, where
no obvious cause exists and b) shiftworkers who need to sleep during the day,
when their melatonin levels would be naturally low. Current progress suggests
the launch of the product in the first quarter of 2008.
Our Phase III clinical trials on Isprelor, our intra-vaginal misoprostol for
induction of labour, began at the beginning of the period under review but site
set-up and patient recruitment was initially slower than at first anticipated.
To compensate for this, the number of sites has been expanded and we now expect
completion in the current year.
Interest in the product from the medical community has been encouraging and an
Alliance sponsored symposium on the use of misoprostol in obstetrics at the 6th
International Scientific Meeting of the Royal College of Obstetricians and
Gynaecologists in Cairo in September was very well attended.
Owing to the size of the opportunity with Posidorm, we have begun out-licensing
discussions for Continental Europe with a number of potential partners and look
forward to providing further details of progress during the course of the
current year.
Profitability
Our profit before tax of £0.66 million for the ten months to December 2005
compares favourably with £0.41 million for the twelve month financial period to
February 2005. This is a particularly good result when one considers that the
development expenditure charged in the P&L is £0.62 million greater than that
charged in the previous financial year. Additionally the 7% compulsory PPRS
price decrease in the UK commencing January 2005 removed £0.61 million of profit
from the ten month financial period ending December 2005. Thus it can be
readily seen that the underlying operational strength of our trading business
improved markedly in real terms during the past financial period. This is a
reflection of:
a) our past strategic measures judiciously to expand in our portfolio;
b) our finely tuned decisions selectively to invest in its growth; and
c) the hard work and dedication of our extremely skilled team.
Organisation and infrastructure
We have strengthened our infrastructure significantly during the course of the
past year with appointments across the Company in areas including sales and
marketing, regulatory, clinical development, acquisitions management and
finance.
First and foremost was the creation of our Dental Products division in April
2005 to drive forward our exploitation of the transformational opportunity
afforded by the acquisition of Periostat in November 2004. This resulted in our
commencement of promotional campaigns to dentists from August 2005 and the
subsequent growth of the brand.
Another important expansion of our sales and marketing capabilities was the
creation of our International Division in May 2005, principally to develop and
manage the overseas business for Forceval and Periostat, but also to exploit
other international opportunities within the rest of the portfolio. One of the
first successes was the appointment in July 2005 of a distributor for Periostat
in Turkey, an important dental market.
In September we appointed a new Director of Regulatory Affairs to ensure the
quality of our regulatory submissions primarily for our development projects,
Posidorm and Isprelor, but also for line extensions and other filings. We have
also appointed a Clinical Projects Manager to add further managerial strength
behind our development programmes. Additionally we have recruited an expert in
Pharmacovigilance to manage the increasing demands affecting the whole of the
Industry in this area.
Our Finance function has been reorganised and strengthened with specific
positions covering financial accounting, management accounting and corporate
administration, the latter role also including investor relations. This new
structure now facilitates our Finance Director's involvement on strategic
financial matters.
We have created the position of Director of Acquisitions Integration,
underlining our intention to maintain the pace of acquisitions at the Company.
This is an innovative role that is dedicated to organising the planning and
integration of acquisitions, so that they are embedded into the Company's
operations with minimal disturbance to ongoing activities. This move is already
showing its worth with the ongoing integration of the Hydromol range of
dermatologicals, acquired on 9 February 2006.
I am therefore pleased that Alliance enters the current year with a team that
has the capability, capacity and enthusiasm to deal with the opportunities and
challenges ahead.
Acquisitions
Post the period end, we acquired the Hydromol range of prescription
dermatological products for eczema and other skin conditions for a cash
consideration of £3.25 million. The acquisition was significant not least
because it delivers critical mass to the Company's existing dermatology
franchise. The addition of key sales executives has strengthened Alliance's
dermatology team.
The Hydromol range includes ointments, creams and bath oils and sales are
growing strongly at over 30.0% pa. It is our intention to increase sales
further by expanding the products' range with line extensions and by extending
the geographic distribution via the Company's network of international
distributors.
Hydromol adds to Alliance's current dermatology portfolio that includes brands
such as Aquadrate, Alphaderm, Occlusal, Pentrax, Meted and Acnisal.
Looking forward
The Company enters the current year with a stronger business base than at any
other time in its history and I am pleased to report that current trading is on
plan. Among our priorities in the current year will be to drive the growth of
Periostat and to integrate the Hydromol acquisition. The current year is likely
to be one in which dermatology will have a much higher profile in the business.
Whilst it is impossible to forecast the outcome of clinical trials and
regulatory submissions we believe that the two compounds - one being based on an
already marketed molecule and the other being a copy of a naturally occurring
hormone - represent a balance of risk and reward that is tipped in the favour of
our shareholders.
Our strengthened infrastructure means that we are well placed to exploit our
significant growth opportunities and to accommodate further acquisitions should
we find products that fit into our clearly defined acquisition criteria.
John Dawson
Chief Executive
22 March 2006
Financial Review
In relation to the presentation of the results for Alliance Pharma plc, two
significant events have happened. Firstly we made the decision to adopt
International Financial Reporting Standards (IFRS) in advance of the required
date for AIM listed companies to align ourselves with other companies in the
sector and to maintain our stance of seeking to be at the forefront of the
industry in terms of best practice. Secondly, after listening to our
shareholders, and considering the positive impact on the Company, we changed the
year end date from 28 February to 31 December. Consequently we are reporting
both transitional IFRS adjustments and a 10 month period; the impact of both
will be illustrated throughout this review. Figures under the heading December
2005 relate to the 10 months period to 31 December 2005, those under February
2005 relate to the year ended 28 February 2005 and those under 'Annualised'
relate to the December 2005 figures annualised, to twelve 10ths of the results.
Equally, we are reporting, in more detail, the operations of the Group under
segmental reporting. The Group is segmented into three areas, the first two of
which are currently revenue producing:
• Core brands - those with no promotional investment, the sales being
driven by prescribing habit
• Growth brands - those with growth potential and behind which we put
our promotional effort
• Development brands - the products Isprelor and Posidorm which are
currently under clinical development with a view to a launch. Investments are
being made, some of which are capitalised, some of which are revenue expenses
which have the effect of reducing the profitability of the revenue producing
segments
IFRS
The approach taken to the IFRS transition was the establishment of a working
group and the preparation of a report to assess the implications of
International Accounting Standards and to prepare the restatement and confirm
the accounting policies under the new regime. The main areas identified as
affecting the financial statements of the Group are Intangible Assets (IAS 38),
Share Based Payments (IFRS 2), Financial Instruments (IAS 39) and Segmental
Reporting (IAS 14).
• An impairment review was performed on all intangible assets which
established that their future contributions were greater than the initial
investment by the Group. As a result, none of these assets were judged to be
impaired and they remain in the Balance Sheet at the same value as the prior
period
• The early marketing and infrastructure expenses invested in the
development projects are expensed through the Income Statement, however the
clinical development spend is capitalised as required under IAS 38 as the
criteria for the capitalisation are met in that
o The projects and expenditure attributable to them are separately
identifiable
o Future economic benefits can be demonstrated
o There are adequate resources to complete the development and the Group
intends to use or sell the completed asset
• The approach to the Share Based Payments valuation was by way of a
financial model based on the volatility of the share price, the number of
options issued, time to expiry and the risk free rate of return
• The Interest Rate Swaps which fix the rate on borrowings for a
specified period were valued independently by the Bank of Scotland Treasury
Department, taking into account time to expiry and market factors
Turnover
The turnover for the 10 months to December 2005 of £12.28 million represented an
increase of 3.8% over the 12 months to February 2005 (£11.83m), however,
annualising the 10 month result demonstrates a 24.6% increase on the period to
February 2005. Analysing this further, Core Brands make up 54.0% of our
portfolio, with £6.63m turnover (10 months), whilst Growth Brands deliver £5.65
million being the remaining 46.0%. In terms of geographical split, the United
Kingdom makes up 70.7% of total turnover based on the 10 months to 31 December
2005, with Republic of Ireland accounting for 21.8% and the Rest of the World
being 7.5%.
Annualised 10 months to December 12 months to
2005 February 2005
£m £m £m
Turnover 14.74 12.28 11.83
Growth 24.6% 3.8%
Growth was tempered by the 7% price decrease imposed on the pharmaceutical
industry in the UK by the Pharmaceutical Price Regulation Scheme 'PPRS' in
January 2005.
Gross Profit
As anticipated our gross margin improved from 52.4% to 54.3% due to
proportionately greater growth of our higher margin brands. This rate of
improvement can be expected to continue.
Operating Profit
Investment in the future growth of the Group has necessitated in an increase in
operating expenses, notably some £1.14 million of marketing and infrastructure
revenue expenses in the 10 month period connected with the development of
Posidorm and Isprelor. The 10 months to 31 December 2005 deliver an operating
profit of £2.17 million being 4.2% below the 12 month period to February,
however, if the development expenditure charged to the P&L is excluded, the
operating profit for the trading segments, being the Growth Brands and Core
Brands, would be £3.08 million being a 6.6% increase over the 12 months to
February 2005.
10 months to 12 months to
December 2005 February 2005
£m £m
Sales revenue 12.28 11.83
Gross profit 6.67 6.20
54.3% 52.4%
Trading Business Expenses (3.59) (3.31)
Trading Segment profit 3.08 2.89
Non Recurring Items 0.23 (0.11)
Trading profit 3.31 2.78
Development Projects (1.14) (0.52)
Operating profit before finance costs 2.17 2.26
Finance Costs
These consist of the interest payments on the debt provided by Bank of Scotland
to fund the acquisitions of the Brands, the interest on the convertible
unsecured loan stock and amortised issue costs. Also shown here is the change in
fair value of the Interest Rate Swaps. These financial instruments reduce our
exposure to interest rate movements by fixing the interest rate for a period of
time. The valuation is determined independently and assesses the difference
between the fixed rate and expected future interest rates.
10 months to 12 months to
December 2005 February 2005
£m £m
Interest paid (1.37) (1.66)
Other finance costs (0.08) (0.19)
Change in fair value of derivative financial instruments (0.06) -
Profit Before Tax
A profit before tax of £0.66 million has been achieved in the 10 months to
December 2005, an improvement on £0.41 million being the profit for the period
to February 2005 under IFRS. If the effects of the IFRS adjustments are removed
from the calculations, the profit would be £0.74 million against £0.42 million
for the previous reporting period.
10 months to December 12 months to February
2005 2005
£m £m
UK GAAP Profit on ordinary activities before taxation 0.74 0.42
Share based payments (0.02) (0.01)
Change in fair value of derivative financial instruments (0.06) 0.00
Profit for the period under IFRS 0.66 0.41
During the year, Uniflu, one of the brands acquired in November 2004, which did
not fit our existing portfolio, was divested for £0.50 million giving rise to a
profit of £0.35m, and is included in the profit shown above within the non
recurring items.
Cashflow
The cash inflow from operating activities was £1.79 million in the 10 months to
31 December 2005 (£1.59 million February 2005). This was reinvested into the
Group by way of £1.85 million on the clinical development spend for Isprelor and
Posidorm, an increase on £0.99 million spent in the year to February 2005.
Interest and capital repayments on the debt funding amounted to £1.43 million
and £1.12 million respectively, £1.82 million and £2.14m being the interest and
capital repayments for the previous period, excluding short term funding
arrangements in place for the acquisition of Forceval. During the year £0.50
million was raised with the divestment of Uniflu.
Non-current assets
During the period, a further £1.85 million was invested and capitalised in the
development of Isprelor and Posidorm, bringing the total to £3.07m. These costs
have been capitalised, having met the criteria set by IAS 38. Each project has
been re-examined to ensure that it has technical feasibility and ultimate
commercial viability.
Financial liabilities and convertible debt
The financial liabilities decreased to £22.90 million (£23.89 million February
2005), including the Convertible Unsecured Loan Stock at £7.17 million, the
change being principally due to the capital repayments of the funding from Bank
of Scotland. Of the total financial liabilities, 89.6% is subject to long term
fixed interest rates resulting from interest on the Convertible Unsecured Loan
Stock being fixed and for other debt, we have in place interest rate swaps which
reduce the exposure to interest rate fluctuations. The currency risk is reduced
by using a debt facility denominated in euros which matches revenues arising in
the Eurozone.
Madeleine Scott
Finance Director
22 March 2006
Consolidated income statement
10 months Year ended
ended 28 February
31 December 2005 2005
Note £ £
Revenue 12,275,888 11,826,292
Cost of sales (5,601,143) (5,624,857)
Gross profit 6,674,745 6,201,435
Operating expenses
Administration and marketing expense (4,716,258) (3,820,470)
Share based employee remuneration (19,083) (10,304)
(4,735,341) (3,830,774)
Operating profit pre non recurring items 1,939,404 2,370,661
Non recurring items 227,731 (109,504)
Operating profit before finance costs 2,167,135 2,261,157
Finance costs
Interest paid 3 (1,366,747) (1,661,487)
Other finance costs 3 (76,373) (191,715)
Change in fair value of derivative financial (62,846) -
instruments
(1,505,966) (1,853,202)
Profit on ordinary activities before taxation 2 661,169 407,955
Taxation - -
Profit for the year attributable to equity 661,169 407,955
shareholders
Earnings per share
Basic and diluted (pence) 0.45 0.33
All of the activities of the company are classed as continuing.
Consolidated balance sheet
31 December 31 December 28 February 28 February
2005 2005 2005 2005
£ £ £ £
Assets
Non-current assets
Goodwill 1,128,973 1,128,973
Intangible fixed assets
- Product licences 25,501,988 25,620,433
- Development costs 3,075,200 1,345,609
Property, plant and equipment 280,977 306,573
29,987,138 28,401,588
Current assets
Inventories 2,739,869 2,469,363
Trade and other receivables 3,034,240 2,149,613
Cash and cash equivalents - 1,275,460
5,774,109 5,894,436
Total assets 35,761,247 34,296,024
Equity
Ordinary share capital 1,473,559 1,473,559
Share premium account 9,030,959 9,030,959
Share option reserve 31,506 12,423
Reverse takeover reserve (329,349) (329,349)
Retained earnings (2,702,117) (3,363,286)
Total equity 7,504,558 6,824,306
Liabilities
Non-current liabilities
Long term financial liabilities 14,794,873 14,293,913
Convertible debt 7,167,100 7,132,423
Other liabilities 177,778 177,778
22,139,751 21,604,114
Current liabilities
Cash and cash equivalents 899,066 -
Financial liabilities 933,749 2,459,910
Trade and other payables and provisions 4,284,123 3,407,694
6,116,938 5,867,604
Total liabilities 28,256,689 27,471,718
Total equity and liabilities 35,761,247 34,296,024
Consolidated statement of changes in shareholders' equity
Share Share Shares to Reserves Retained Total
capital premium be issued earnings equity
£ £ £ £ £ £
Balance 1 March 2005 1,473,559 9,030,959 12,423 (329,349) (3,363,286) 6,824,306
Costs of share issue - - - - - -
reclaimed
Employee benefits - - 19,083 - - 19,083
Profit for the period - - - - 661,169 661,169
Balance 31 December 2005 1,473,559 9,030,959 31,506 (329,349) (2,702,117) 7,504,558
Balance 29 February 2004 1,107,939 5,214,638 2,119 (329,349) (3,771,241) 2,224,106
Costs of share issue - 7,123 - - - 7,123
reclaimed
Issue of shares 365,620 - - - - 365,620
Premium on shares issued - 3,809,198 - - - 3,809,198
Employee benefits - - 10,304 - - 10,304
Profit for the - - - - 407,955 407,955
period
Balance 28 February 2005 1,473,559 9,030,959 12,423 (329,349) (3,363,286) 6,824,306
Consolidated cashflow
For the 10 month period ended 31 December 2005
Group
10 months Year
ended ended
31 December 28 February
2005 2005
Note £ £
Cash flows from operating activities
Cash generated from operations 4 1,788,157 1,585,204
Tax paid - (12,747)
Cash flows from operating activities 1,788,157 1,572,457
Investing activities
Interest received 61,215 161,726
Payment of deferred consideration - (128,399)
Development costs capitalised (1,849,860) (858,499)
Purchase of tangible assets (82,778) (245,948)
Proceeds from divestment of Uniflu 500,000 -
Transactions costs on divestment of Uniflu (32,000) -
Purchase of other intangible assets (1,555) (9,248,913)
Net cash used in investing activities (1,404,978) (10,320,033)
Financing activities
Net proceeds from the issue of shares - 4,181,941
Interest paid and similar charges (1,426,319) (1,820,209)
Other finance charges paid (1,643) (3,004)
Receipt from borrowings - 6,875,000
Repayment of borrowings (1,115,839) (3,763,859)
Finance lease payments (13,904) (26,031)
Net cash used in financing activities (2,557,705) 5,443,838
Net movement in cash and cash equivalents (2,174,526) (3,303,738)
Cash and cash equivalents at 1 March 2005 / 1,275,460 4,579,198
29 February 2004
Cash and cash equivalents at 31 December 2005 / (899,066) 1,275,460
28 February 2005
1. Basis of preparation
The financial information set out in the announcement does not constitute the
group's statutory accounts for the periods ended 31 December 2005 or 28 February
2005. The financial information for the year ended 28 February 2005 is derived
from the statutory accounts for that year which have been delivered to the
Registrar of Companies, as subsequently restated under IFRS as published on the
group's website on 21/06/2005. The auditors reported on those accounts; their
report was unqualified and did not contain a statement under s.237(2) or (3)
Companies Act 1985. The statutory accounts for the period ended 31 December
2005 will be finalised on the basis of the financial information presented by
the directors in this preliminary announcement and will be delivered to the
Registrar of Companies.
2. Profit before taxation:
10 months Year
ended ended
31 December 28 February
2005 2005
£ £
After charging
Auditors' remuneration - Group
- audit services 30,500 29,500
- non-audit services 53,574 60,561
Auditors' remuneration - Company
- audit services 8,500 8,500
- non-audit services 1,300 2,200
Non recurring items
- Project costs in relation to aborted acquisition - 109,504
Employee benefit expense 19,083 10,304
Depreciation of tangible assets 108,374 115,229
Operating lease rentals 37,196 42,816
Loss on foreign exchange transactions 12,547 -
After crediting
Non recurring items
- Gain on disposal of Uniflu less impairment of intangibles 227,731 -
Profit on foreign exchange transactions - 37,653
Included within non-audit services are tax advice and compliance fees of
£16,310, advice on the implementation of IFRS £15,609 and other of £21,655.
3. Finance costs - net
10 months Year
ended ended
31 December 28 February
2005 2005
£ £
Net interest and similar charges
On loans and overdrafts (1,426,319) (1,820,209)
Finance lease interest (1,643) (3,004)
Interest income 61,215 161,726
(1,366,747) (1,661,487)
Other finance charges
Foreign exchange movement on long term Euro denominated debt (2,263) (117,727)
Amortised finance issue costs (74,110) (73,988)
(76,373) (191,715)
Finance costs - net (1,443,120) (1,853,202)
4. Cash generated from operations
Group
10 months Year
ended ended
31 December 28 February
2005 2005
£ £
Result for the period before tax and finance 2,167,135 2,261,157
costs
Depreciation of property, plant and equipment 108,374 115,229
Change in inventories (270,506) (729,847)
Change in trade and other receivables (884,627) (165,521)
Change in trade and other payables 876,429 93,882
Write-off intangible assets 120,269 -
Gain on divestment of Uniflu (348,000) -
Share options charges 19,083 10,304
Cash flows from operating activities 1,788,157 1,585,204
This information is provided by RNS
The company news service from the London Stock Exchange
Latest directors dealings
- 20 seconds ago Spectris
- 22 minutes ago Clarkson
- 29 minutes ago Smithson Investment Trust
- 41 minutes ago Manchester & London Investment Trust
- 2 hours ago Softcat