Half-year Report

RNS Number : 4324Q
Venn Life Sciences Holdings PLC
12 September 2017
 

Venn Life Sciences Holdings Plc

("Venn" or the "Company" or the "Group")

 

Half-year Report

Interim Results for 6 months ended 30 June 2017

 

Venn Life Sciences (AIM: VENN), a growing Contract Research Organisation (CRO) providing drug development, clinical trial management and resourcing solutions to pharmaceutical, biotechnology and medical device clients, announces its unaudited interim results for the six months ended 30 June 2017.

 

Financial Highlights

·     Revenue of €9.15m (H1 2016: €9.06m)

·      EBITDA of €0.414m (H1 2016: €0.402m)

·     Operating profit €0.01m (H1 2016: loss of €0.03m)

·     Cash and cash equivalents of €2.93m at 30 June 2017 (€1.75m at 30 June 2016)

 

Operational Highlights

·     Completion of key systems initiatives  

·     Successful achievement of key project milestones leading to strong client endorsements and repeat business 

·     Key new leadership hires in Information Technology and Quality Assurance

·     Integumen successfully floated on AIM, London in April 2017

 

Post Period End 

·     Strengthening of the board & management with the appointment of Christian Milla as COO

·     Finalisation of Kinesis acquisition with no further consideration payable 

 

Commenting today, Allan Wood, Non-Executive Chairman of Venn, said:

"The divestment of Innovenn, and subsequent flotation of Integumen, has facilitated a more singular focus on our core business, which now provides a unique range of drug development services for our customers. This coupled with key management additions and the conclusion of certain systems implementations leaves Venn well positioned to execute on new business opportunities. I would like to welcome Christian Milla to the team, Christian's deep sector knowledge will be of significant benefit to the Group as we grow in the future. I would also like to express my gratitude to Gracielle Schutjens for her significant contribution to the business thus far and welcome her future commitment to developing new business for the Group."

 

Enquiries:

 

Venn Life Sciences Holdings Plc


Allan Wood, Non-Executive Chairman

Tel: +44 (0)7185 325 898

Tony Richardson, Chief Executive Officer

Tel: +353 (0)87 2535 982



Davy (NOMAD, Broker & ESM Advisor)


Fergal Meegan / Matthew de Vere White (Corporate Finance)

Tel: +353 (0)1 679 6363



Hybridan LLP (Co-Broker)

Tel: +44 (0)20 3764 2341

Claire Louise Noyce




Walbrook PR Ltd

Tel: +44(0)20 7933 8787 or venn@walbrookpr.com

Paul McManus   

Mob: +44 (0)7980 541 893

Lianne Cawthorne

Mob: +44 (0)7584 391 303

 

 

About Venn Life Sciences

www.vennlifesciences.com

 

Venn Life Sciences is a European Contract Research Organisation providing drug development, clinical trial management and resourcing solutions to pharmaceutical, biotechnology, academic and medical device organisations. With dedicated operations in France, Germany, the Netherlands, the UK, Ireland and Europe wide representation - Venn specialises in tailored end to end drug development consultancy and clinical trial management services.



Chairman's Statement

 

Dear Shareholder,

 

The first half of 2017 has seen the addition of new clients, good recurring revenue and a concerted effort to grow existing and new accounts as our operational capabilities have developed at Venn. The client base continues to develop both in number and profile with over one hundred clients and a healthy mix of mature and emerging biopharma companies. While there is currently a significant concentration of revenue among our top ten clients there is also clear opportunity to scale up our engagement with the remainder of the client base and this has been a key focus for the team in 2017. Infrastructure and systems initiatives are now largely complete so the business is well positioned to execute new business opportunities.   

 

Financial Results

Fee income for the first six months of 2017 was €9.15m, up on the first six months of 2016 (H1 2016: €9.06m). EBITDA profit for the period was €0.41m compared to EBITDA profit of €0.40m for the first half of 2016. Operating profit for the six months was €0.01m compared with a loss for the first six months of 2016 of €0.03m. While H1 financial performance was positive, it was adversely impacted by the deferral of a late- phase project to Q1 2018 and some underperformance in the early-phase part of our business. We have concluded the acquisition of Kinesis with no further consideration payable. As we now fully integrate Kinesis, we are confident that an improved performance will validate the strategic and financial merit of the transaction for the Group. With current cash reserves at 30thJune 2017 of €2.93m the business is well resourced to deliver on its growth plans.

 

Operational Review

Our operational focus continues to be on improving margins and project profitability. The team has delivered successfully on key project milestones resulting in repeat business and valuable case studies that can be leveraged for business development. We continue initiatives to migrate from the use of contractors and sub-contractors to Venn resources as part of a margin improvement plan, aiming to maintain the right degree of flexibility in our resource base. Our operations team has been strengthened with key personnel appointments in Information Technology and Quality Assurance.   

 

Board Changes

I am pleased to welcome Christian Milla to the board and look forward to working with him in his new role as COO. Christian has extensive sector experience and will be a strong addition to the management team as the business continues to scale. I would like to thank Gracielle Schutjens for her valuable contribution to the board and development of the business to its current stage. I am pleased that Gracielle will continue as a business generator for Venn and I am confident that she will continue to make a significant contribution to our future development.  

 

New Developments & Outlook

Overall I am pleased with the progress achieved in this half year. The business now has a stable and secure platform on which we can deliver the next phase of growth. Strengthening of the management team, completion of key technology initiatives, and additional business development resources will drive future growth.

 

Allan Wood

Chairman

12 September 2017



 

Consolidated Statement of Comprehensive Income

For the six months ended 30 June 2017

 



Unaudited


Unaudited


Audited



6 months ended


6 months ended


Year ended



30 June


30 June


31 December



2017


2016


2016



€'000


€'000


€'000

Continuing operations







Revenue


9,146


9,064


18,244

Administrative expenses


(9,136)


(9,097)


(18,805)

Operating profit/(loss)


10


(33)


(561)

  Depreciation and amortisation


(392)


(435)


(822)

  Exceptional items


(12)


-


(125)

EBITDA before exceptional items


414


402


386

Finance income


-


-


12

Finance costs


-


(33)


-

Share of loss of investments accounted for using the equity method


 

(543)




(364)

(Loss) before income tax


(533)


(66)


(913)

Income tax credit/(charge)


48


-


169

Loss for the period from continuing operations


(485)


(66)


(744)

Discontinued Operations







Loss after tax of discontinued operations


-


(652)


(1,002)

Gain on sale of the subsidiary after tax


-


-


2,297

Profit/(loss) for the period


(485)


(718)


551

Profit/(loss) attributable







Owners of the parent


(477)


(411)


532

Non-controlling interest


(8)


(307)


19

Loss for the year


(485)


(718)


551

Currency translation differences


16


(15)


(36)

Share of currency translation differences in associates accounted for using the equity method


 

(65)





Total comprehensive loss for the period


(534)


(733)


515

 

Earnings/(loss) per share from continuing and discontinued operations attributable to the owners of the parent during the period





Basic earnings/(loss) per share


€ Cent


€ Cent


€ Cent

From continuing operations


(0.79)


(0.11)


(1.26)

From discontinued operations


-


(0.63)


2.14

From profit/(loss) for the year


(0.79)


(0.74)


0.88








Diluted earnings/(loss) per share


€ Cent


€ Cent


€ Cent

From continuing operations


(0.71)


(0.10)


(1.14)

From discontinued operations


-


(0.57)


1.93

From profit/(loss) for the year


(0.71)


(0.67)


0.79



 

Consolidated Statement of Financial Position

As at 30 June 2017

 



Unaudited


Unaudited


Audited



As at


As at


As at



30 June


30 June


31 December



2017


2016


2016



€'000


€'000


€'000

Assets







Non-current assets







Property, plant and equipment


492


196


191

Intangible assets


4,110


4,374


4,499

Available-for-sale Intangible assets


-


743


-

Investments


1,903


31


2,038

Total non-current assets


6,505


5,344


6,728








Current assets







Trade and other receivables


4,990


7,042


4,402

Income tax recoverable


104


100


43

Available-for-sale current assets


-


400


-

Cash and cash equivalents


2,933


1,748


3,541

Total current assets


8,027


9,290


7,986

Total assets


14,532


14,634


14,714








Equity attributable to owners







Share capital


155


155


155

Share premium account


14,026


14,011


14,026

Group re-organisation reserve


(541)


(541)


(541)

Reverse acquisition reserve


45


45


45

Foreign currency reserves


(36)


34


13

Share option reserve


30


45


28

Retained earnings


(3,771)


(4,237)


(3,294)



9,908


9,512


10,432

Non-controlling interest


(8)


20


-

Total equity


9,900


9,532


10,432








Liabilities







Non-current liabilities







Borrowings


8


34


25

Total non-current liabilities


8


34


25








Current liabilities







Trade and other payables


4,069


4,130


3,661

Available-for-sale current liabilities


-


202


-

Deferred taxation


529


692


561

Deferred consideration


-


-


-

Borrowings


26


44


35

Total current liabilities


4,624


5,068


4,257

Total liabilities


4,632


5,102


4,282

Total equity and liabilities


14,532


14,634


14,714

 



 

Consolidated Statement of Cash Flows

For the 6 months ended 30 June 2017



Unaudited

Unaudited

Audited



6 months ended

6 months ended

Year

ended



30 June

30 June

31 December



2017

2016

2016



€'000

€'000

€'000

Cash Flow from operations





Loss before income tax - continuing operations


(533)

(718)

(913)

- discontinued operations


-

-

1,295

Adjustments:





- Depreciation & Amortisation


392

489

822

- Foreign currency movement


(28)

89

134

- Exceptional Item


12

33

79

- Net finance costs


-

37

(12)

- Share options charge


2


15

- Share in associated undertakings


543


(364)

Changes in working capital





- Increase in financial asset fair value


-

-

(2,007)

- Increase in intangible assets


45

-

-

- Trade and other receivables


(588)

(1,859)

1,289

- Trade and other payables


360

145

(557)


205

(1,785)

(219)

Interest paid


-

(37)

-

Income tax received/(paid)


-

(77)

38

Net cash generated/(used) in operating activities


205

(1,898)

(181)





Cash flow from investing activities





Investment in associate


(473)

-

-

Exceptional costs


(12)


(79)

Purchase of property, plant and equipment (PPE)


(301)

16

-

Interest received


-

-

12

Net cash used in investing activities


(786)

16

(67)





Cash flow from financing activities





Proceeds from issuance of ordinary shares


-

-

15

Repayments on borrowings


(26)

(9)

(27)

Net cash flow from financing activities


(26)

(9)

(12)





Net increase /(decrease) in cash and cash equivalents


(607)

(1,891)

(260)

Cash and cash equivalents at beginning of year


3,541

3,798

3,798

Exchange gain on cash and cash equivalents


(1)

(104)

3

Cash and cash equivalents at end of period


2,933

1,803

3,541

 

 

 

Cash and cash equivalents include the following for the purposes of the statement of cash flows:

 



Unaudited

Unaudited

Audited



6 months ended

6 months ended

Year

ended



30 June

30 June

31 December



2017

2016

2016



€'000

€'000

€'000

Cash and cash equivalents


2,933

1,748

3,541

Discontinued Operations cash and cash equivalents


-

55

-

Cash and cash equivalents


2,933

1,803

3,541






Consolidated Statement of Changes in Shareholders' Equity

 

 

 

 

Share

capital

 

Share

premium

Re-organisation  & reverse acquisition

reserve

Share

 Option reserve

Foreign Currency reserve

 

Retained

earnings

 

 

Total

 

 

Non-controlling Interests

 

 

Total


€'000

€'000

€'000

€'000

€'000

€'000

€'000

€'000

€'000

At 1 January 2016

155

14,011

(496)

13

49

(3,826)

9,906

327

10,233

Changes in equity for 6 months

ended 30 June 2016










Total loss for the period

-

-

-

-

-

(411)

(411)

(307)

(718)

Currency translation differences

-

-

-

-

(15)

-

(15)

-

(15)

Total comprehensive loss for

the period

-

-

-

-

(15)

(411)

(426)

(307)

(733)

Transactions with the owners

Options issued

 

-

 

-

-

32

-

-

32

-

32

At 30 June 2016

155

14,011

(496)

45

34

(4,237)

9,512

20

9,532

Changes in equity for 6 months

ended 31 December 2016










Total gain for the period

-

-

-

-

-

943

943

(20)

923

Currency translation differences

-

-

-

-

(21)

-

(21)

-

(21)

Total comprehensive gain for

the period

-

-

-

-

(21)

943

922

(20)

902

Transactions with the owners

Options issued

-

-

-

(17)

-

-

(17)

-

(17)

Shares issued

-

15

-

-

-

-

15

-

15

At 31 December 2016

155

14,026

(496)

28

13

(3,294)

10,432

-

10,432

Changes in equity for 6 months

ended 30 June 2017










Total loss for the period

-

-

-

-

-

(477)

(477)

(8)

(485)

Currency translation differences

-

-

-

-

(49)

-

(49)

-

(49)

Total comprehensive loss for

the period

-

-

-

-

(49)

(477)

(526)

(8)

(534)

Transactions with the owners

Options issued

 

-

 

-

-

2

-

-

2

-

2

At 30 June 2017

155

14,026

(496)

30

(36)

(3,771)

9,908

(8)

9,900

 

 

 



 

NOTES FORMING PART OF THE INTERIM FINANCIAL STATEMENTS

 

1.              General information and basis of presentation

 

Venn Life Sciences Holdings Plc is a company incorporated in England and Wales. The Company is a public limited company listed on the AIM market of the London Stock Exchange. The address of the registered office is 4 Lombard Street, London, EC3V 9HD.

 

The Group's principal activity continues to be that of a Clinical Research Organisation (CRO) providing a suite of consulting and clinical trial services to pharmaceutical, biotechnology and medical device organisations. 

 

The financial information in these interim results is that of the holding company and all of its subsidiaries. They have been prepared in accordance with IAS 34. The accounting policies applied by the Group in this financial information are the same as those applied by the Group in its financial statements for the year ended 31 December 2016 and which will form the basis of the 2017 financial statements except for a number of new and amended standards which have become effective since the beginning of the previous financial year. These new and amended standards are not expected to materially affect the Group.

The financial information presented herein does not constitute full statutory accounts under Section 434 of the Companies Act 2006 and was not subject to a formal review by the auditors. The financial information in respect of the year ended 31 December 2016 has been extracted from the statutory accounts which have been delivered to the Registrar of Companies. The Group's Independent Auditor's report on those accounts was unqualified, did not include references to any matters to which the auditor drew attention by way of emphasis without qualifying their report and did not contain a statement under section 498(2) or 498(3) of the Companies Act 2006. The financial information for the half years ended 30 June 2017 and 30 June 2016 is unaudited and the twelve months to 31 December 2016 is audited.

2. Earnings per share

 

(a) Basic                                              

Basic earnings per share is calculated by dividing the loss attributable to equity holders of the company by the weighted average number of ordinary shares in issue during the period.

 


Unaudited


Unaudited


Audited


6 months ended


6 months ended


Year ended


30 June


30 June


31 December


2017


2016


2016

 

Profit/(loss) from continuing operations attributable to equity holders of the Company (€'000)

(477)


(66)


(763)

Profit/(loss) from discontinued operations attributable to owners of the parent

-


(380)


1,295

Total

(477)


(446)


532







Weighted average number of Ordinary Shares in issue

60,284,263


60,246,433


60,264,907







                                                                   

(b) Diluted

Diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares outstanding to assume conversion of all dilutive potential ordinary shares.

 



 

Weighted average number of shares used as the denominator

 


Unaudited


Unaudited


Audited


6 months ended


6 months ended


Year ended


30 June


30 June


31 December


2017


2016

(restated)


2016

(restated)

Weighted average number of Ordinary Shares in issue

60,284,263


60,246,433


60,264,907

Adjustments for calculation of diluted earnings per share:






Options

6,510,000


6,510,000


6,510,000

Warrants

166,666


166,666


166,666

Total

66,960,929


66,923,099


66,941,573

 

3.             Dividends

 

There were no dividends provided or paid during the six months.

 

4.             Press

               

A copy of this announcement is available from the Company's website, being www.vennlifesciences.com.  If you would like to receive a hard copy of the interim report please contact the Venn Life Sciences Holdings  Plc offices on +31 (0) 524 712 456 to request a copy.


This information is provided by RNS
The company news service from the London Stock Exchange
 
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