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Venn Life Sciences (ORPH)

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Tuesday 11 June, 2019

Venn Life Sciences

Audited Final Results

RNS Number : 7490B
Venn Life Sciences Holdings PLC
11 June 2019
 

 

 

11 June 2019

Venn Life Sciences Holdings Plc

("Venn", "Venn Life Sciences" or the "Company")

 

Audited Final Results for the year ended 31 December 2018

 

Venn Life Sciences (AIM: VENN), an Integrated Drug Development Partner offering a combination of drug development expertise and clinical trial design and management to pharmaceutical, biotechnology and medical device organisations, announces its audited results for the year ended 31 December 2018.

 

Financial Highlights

 

·    Total revenue was €14.3m (2017: €17.8m)

·      EBITDA Loss (before exceptional items) of €1.43m (2017: profit €0.83m)

·      Write down of €2.2m on the impairment of Intangible Assets  

·    Loss for the year after tax of €4.8m (2017: €1.7m) after a charge of €2.6m (2017: €1.7m) being investment write-down on Integumen PLC (€0.4m) and impairment of intangible assets (€2.2m)

·    Arrangement of £1.0 million loan note in December to support working capital and collaboration with Open Orphan

·    Cash and cash equivalents of €1.1m as at 31 December 2018 (2017: €1.2m)

Operational Highlights

 

·    Improved revenue mix with lower key client dependency

·    Maintenance of billable resource base despite project deferrals, enabling quicker business recovery

·    Strategic collaboration with Open Orphan and focus on Rare and Orphan indications

·    Successful management of ground breaking, life-saving technology development program providing invaluable reference point for future business generation

Outlook

 

Post the year end the Company has experienced a continuation of prior year trends with low utilisation resulting in revenue and EBITDA being behind management forecasts for the year to date. Based on the current proposals book the Directors expect there should be an increase in revenues in the coming months. However, the Company continues to require careful management of available cash resources and the Directors expect additional financial resources to be required in order for the Company to successfully execute its growth strategy.

 

Commenting on the Group's results, Cathal Friel, CEO of Venn, said:

 

"The year to 31 December 2018 has been challenging for the Company with a need to closely monitor cash resources; a trend that continued into 2019, notwithstanding the cash realised from the recent disposals of investment assets. The new Board has taken a very prudent approach to all matters associated with the past performance of Venn and is comfortable that the Company now has a solid platform from which to move forward. We are optimistic that with the commencement of deferred projects and a new business focus on Rare and Orphan indications, as demonstrated by the proposed acquisition of Open Orphan DAC, that the business can return to revenue growth in the near term."

 

Enquiries:

Venn Life Sciences Holdings Plc Tel: +353 (0)1 5499 341
Cathal Friel / Tony Richardson

Arden Partners (Nominated Advisor and Joint Broker) Tel: +44 (0)20 7614 5900
John Llewellyn-Lloyd / Ruari McGirr / Benjamin Cryer

Davy (Euronext Growth Adviser and Joint Broker) Tel: +353 (0)1 679 6363
Anthony Farrell (Corporate Finance) / Ivan Murphy

Camarco (Financial PR) Tel: +44 (0)20 3757 4980
Tom Huddart / Billy Clegg / Daniel Sherwen

 

 

Consolidated Statement of Comprehensive Income

For the year ended 31 December 2018

 

 

 

2018

 

2017

Restated

 

 

€'000

 

€'000

Continuing operations

 

 

 

 

Revenue

 

13,920

 

17,405

Direct Project and Administrative Costs

 

(16,658)

 

(17,897)

Other operating income

 

371

 

410

Operating (loss)

 

(2,367)

 

(82)

  Depreciation

 

(95)

 

(99)

  Amortisation

 

(840)

 

(792)

  Exceptional items

 

(-)

 

(25)

EBITDA before exceptional items

 

(1,432)

 

834

Finance income

 

10

 

-

Share of loss of investments accounted for using the equity method

 

(-)

 

(874)

Impairment of fixed asset investments

 

(421)

 

(843)

Impairment of Intangible Assets

 

(2,232)

 

-

(Loss) before income tax

 

(5,010)

 

(1,799)

Income tax credit

 

235

 

127

(Loss) for the year from continuing operations

 

(4,775)

 

(1,672)

Loss for the year is attributable to:

 

 

 

 

Owners of the parent

 

(4,775)

 

(1,672)

 

 

(4,775)

 

(1,672)

Other comprehensive income

 

 

 

 

Currency translation differences

 

85

 

(139)

Total comprehensive (loss) for the year

 

(4,690)

 

(1,811)

Total comprehensive (loss) for the year is attributable to:

 

 

 

 

Owners of the parent

 

(4,690)

 

(1,811)

 

 

(4,690)

 

(1,811)

Total comprehensive (loss) for the year attributable to owners of the parent arises from:

 

 

 

 

Continuing operations

 

(4,690)

 

(1,811)

 

 

(4,690)

 

(1,811)

 

 

 

 

 

Earnings per share from continuing operations attributable to owners of the parent during the year

 

 

 

 

 

 

 

 

 

Basic and diluted (loss) per ordinary share

 

 

 

 

From continuing operations

 

(7.31c)

 

(2.77c)

From (loss) for the year

 

(7.31c)

 

(2.77c)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated Statement of Financial Position

As at 31 December 2018

 

 

 

 

Group

Group

 

 

 

 

2018

2017 Restated

 

 

 

 

€'000

€'000

Assets

 

 

 

 

 

Non-current assets

 

 

 

 

 

Property, plant and equipment

 

 

 

263

312

Intangible assets

 

 

 

996

4,034

Investments

 

 

 

31

31

Total non-current assets

 

 

 

1,290

4,377

 

 

 

 

 

 

Current assets

 

 

 

 

 

Trade and other receivables

 

 

 

6,004

5,514

Income tax recoverable

 

 

 

7

107

Cash and cash equivalents

 

 

 

1,098

1,175

Assets held for sale

 

 

 

259

680

Total current assets

 

 

 

7,368

7,476

Total assets

 

 

 

8,658

11,853

 

 

 

 

 

 

Equity attributable to owners

 

 

 

 

 

Share capital

 

 

 

168

155

Share premium account

 

 

 

14,701

14,026

Group re-organisation reserve

 

 

 

(541)

(541)

Reverse acquisition reserve

 

 

 

45

45

Other Reserve

 

 

 

(34)

-

Foreign currency reserves

 

 

 

(41)

(126)

Retained earnings

 

 

 

(9,939)

(5,164)

Total equity

 

 

 

4,359

8,395

 

 

 

 

 

 

Liabilities

 

 

 

 

 

Non-current liabilities

 

 

 

 

 

Borrowings

 

 

 

1,093

-

Total non-current liabilities

 

 

 

1,093

-

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

Trade and other payables

 

 

 

2,538

2,999

Deferred taxation

 

 

 

199

434

Borrowings

 

 

 

469

25

Total current liabilities

 

 

 

3,206

3,458

Total liabilities

 

 

 

4,299

3,458

Total equity and liabilities

 

 

 

8,658

11,853

 

 

 

 

 

 

 

Consolidated Statement of Cash Flows

For the year ended 31 December 2018

 

 

 

 

Group

Group

 

 

 

 

2018

2017

 

 

 

 

€'000

€'000

Cash Flow from operating activities

 

 

 

 

Continuing operations

 

 

 

 

Cash used in operations

 

 

 

(1,105)

(1,282)

Income tax (paid)

 

 

 

(-)

(64)

Net cash used in operating activities

 

 

 

(1,105)

(1,346)

 

 

 

 

 

 

Cash flow from investing activities

 

 

 

 

 

Investment in associate

 

 

 

(35)

(465)

Purchase of intellectual property

 

 

 

(33)

(327)

Purchase of property, plant and equipment

 

 

 

(46)

(193)

Interest received

 

 

 

10

-

Net cash used in investing activities

 

 

 

(104)

(985)

 

 

 

 

 

 

Cash flow from financing activities

 

 

 

 

 

Proceeds from issuance of ordinary shares

 

 

 

688

-

Proceeds from invoice discounting

 

 

 

469

-

Repayments on borrowings

 

 

 

(25)

(35)

Net cash generated by financing activities

 

 

 

1,132

(35)

 

 

 

 

 

 

Net (decrease) in cash and cash equivalents

 

 

 

(77)

(2,366)

Cash and cash equivalents at beginning of year

 

 

 

1,175

3,541

Cash and cash equivalents at end of year

 

 

 

1,098

1,175

 

 

 

 

Consolidated Statement of Changes in Shareholders' Equity

 

 

 

Share capital

 

Share

premium

Other Reserves

Share Option reserve

 

Foreign currency reserve

Restated

Retained

earnings

 

 

Total

 

€'000

€'000

€'000

€'000

€'000

€'000

€'000

At 1 January 2017

as previously stated

155

14,026

(496)

28

13

(3,294)

 

10,432

 

Prior Year Adjustment

-

-

-

-

-

(226)

(226)

At 1 January 2017

after prior year adjustment

155

14,026

(496)

28

13

(3,520)

10,206

Changes in equity for the year

ended 31 December 2017

 

 

 

 

 

 

 

(Loss) for the year as previously

 stated

-

-

-

-

-

(1,538)

(1,538)

Prior Year adjustment

 

 

 

 

 

(134)

(134)

Currency translation

differences

-

-

-

-

(139)

-

(139)

Total comprehensive

(loss) for the year

-

-

-

-

(139)

(1,672)

(1,811)

Transactions with the owners

 

 

 

 

 

 

 

Shares issued

-

-

-

-

-

-

-

Share option provision reversed

-

-

-

(28)

-

28

-

Total contributions by and

distributions to owners

-

-

-

(28)

-

28

-

At 31 December 2017

after prior year adjustment

155

14,026

(496)

-

(126)

(5,164)

8,395

Changes in equity for the year

ended 31 December 2018

 

 

 

 

 

 

 

(Loss) for the year

-

-

-

-

-

(4,775)

(4,775)

Currency translation

differences

-

-

-

-

85

-

85

Total comprehensive

(loss) for the year

-

-

-

-

85

(4,775)

(4,690)

Transactions with the owners

 

 

 

 

 

 

 

Shares issued

13

675

-

-

-

-

688

Purchase of minority Interest

-

-

(34)

-

-

-

(34)

Total contributions by and

distributions to owners

13

675

(34)

-

-

-

654

At 31 December 2018

168

14,701

(530)

-

(41)

(9,939)

4,359

 

Note: 'Other reserves' above includes Group re-organisation reserve, Reverse acquisition reserve and Other reserve relating to non-controlling interest buy-back.

 

1. General information

 

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. On 18 January 2016, the company also listed on the ESM market of the Irish Stock Exchange. The address of the registered office is 2nd Floor, Berkeley Square House, Mayfair London, W1J 6BD.

 

The principal activity of the Group is that of a Clinical Research Organisation providing a suite of consulting and clinical trial services to pharmaceutical, biotechnology and medical device organisations. The Group has a presence in the UK, Ireland, France, Netherlands, Germany and Singapore.

 

The financial statements are presented in Euros, the currency of the primary economic environment in which the Group's trading companies operate. The Group comprises Venn Life Sciences Holdings Plc and its subsidiary companies.

 

The registered number of the Company is 07514939.

 

 

 

 

 

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.

 

 

 

 

 

Restated

 

 

 

Year ended

 

Year ended

 

 

 

31 December

 

31 December

 

 

 

2018

€'000

 

2017

€'000

 

Loss from continuing operations attributable to equity holders of the Company (€'000)

 

 

(4,775)

 

(1,672)

Total

 

 

(4,775)

 

(1,672)

 

 

 

 

 

 

Weighted average number of Ordinary Shares in issue

 

 

65,293,943

 

60,284,263

 

 

 

 

 

 

 

 

                       

b) Diluted

Due to the losses in the periods the effect of the share options and warrants noted below were considered to be anti-dilutive.

 

 

 

 

 

 

 

Restated

 

 

Year ended

 

 

Year ended

 

 

31 December

2018

 

 

31 December

2017

 

 

 

 

 

 

 

 

 

 

 

 

Potential dilutive ordinary shares

 

 

 

 

 

Options

 

6,544,167

 

 

4,985,288

Warrants

 

418,749

 

 

166,666

Total

 

6,962,916

 

 

5,151,954

 

 

3.             Prior Year adjustments

 

1.     As a result of the adoption of IFRS15 a full review of accrued income on all active and completed contracts was undertaken in 2018 and the result was a €226,000 correction was required to the year end 2016 retained earnings balance carried forward for accrued income.

 

2.     There was a release of €134,000 held in an escrow account in 2017 relating to the completion of a purchase of a subsidiary. A 2016 accrual should have been reversed in 2017 when the escrow account was released this has corrected as a prior year adjustment in 2017.

 

 

 


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