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Results for the year ended
Released 07:00:05
RNS Number : 1831L
Results for the year ended
By 2050 the world will need 60% more food
Our products support sustainable food production by using nature to enable farmers to produce more from less land, whilst protecting soils and biodiversity and reducing reliance on chemical fertilizers.
•
• The market for biological products is growing at 12% per annum and is projected to be a
•
• Sales of the Group's Harpin product increased by 55% in 2021, as market shares grew in core markets; the Commercial business is profitable and cash generative.
• The Company has invested more than
• PREtec products are targeting markets worth more than
• The first PREtec product Saori™, was launched in
2021 highlights
Commercial*
• Revenue was
• Proprietary product revenue increased
• The Commercial business was EBITDA and cash positive for the second straight year.
• On-ground sales*** in
PREtecproducts
• Successful launch of Saori™ in
• PHC949 was submitted for registration in the
• Low-cost manufacture of PREtec peptides was demonstrated at the pilot scale.
• The Group has a rich pipeline**** from the PREtec platform.
• PREtec is a patented platform technology, targeting
Group
• Cash used in operations increased to
• Adjusted LBITDA***** increased to
• Cash and cash equivalents including investments at
• The Company successfully raised £6.6 million (
* The commercial business is defined as sales of our proprietary and third-party products to our global distributors in the
** Constant currency is defined below.
*** On-ground sales is defined as sales by our distributors to growers.
**** Three additional peptides are expected to be launched between 2022 and 2024. The Group is also researching additional peptides in our
***** Adjusted LBITDA: Loss before Interest, tax, depreciation, amortization, share-based payments and intercompany foreign exchange.
2021 has been an excellent year of delivery against promise. The market for sustainable agriculture is growing at more than 12% per annum;
Delivering Performance
Sustainability
The benign profile of our technology has long attracted investor attention. PHC applied for and gained the LSE's Green Economy Mark in 2021. This is gratifying, but in a sense it understates our case. We are world leaders in the use of biological signals to engage the natural powers of crop plants to protect themselves from stresses like drought or frost, and to defend themselves against pests and diseases. This is good not only for crop yields, plant health and harvest quality, but it also improves soil health, boosts carbon sequestration, and reduces the need for pesticides.
Strategy
Since 2018, we have evolved our strategy from a focus on licensing our technology to major suppliers of agrochemicals, towards working with distributors. In the
PREtec- "Vaccines for Plants"
I am immensely proud that we are now launching the first products. We are now confident of launching a new PREtecproduct every year in a major market, via a major distributor. This has required securing scale up production capability in house, and manufacturing capacity externally. In 2021 we installed pilot production capacity in our technology centre in
Covid-19
The world had to cope with the continued pandemic throughout 2021. In
The directors have been watching the heart-breaking situation happening in
People
In the face of 2021's worldwide challenges, our people have been thriving. During the year,
For further information, please contact:
Cenkos Securities plc - Nomad & Broker Tel: +44 (0) 20 7391 8900
Company website: www.planthealthcare.com
Chief Executive Officer's statement
Dr
Accelerating performance
Performing above expectations
Revenue growth accelerated in 2021, with Harpin αβ sales up 55%, lifting overall sales growth to 28% (24% in constant currency). The Commercial business remains profitable and cash generative. We invested
Stronger balance sheet
We were very pleased to receive the support of shareholders for a fundraise in
Accelerating commercial sales
Sales of our core Harpin αβ product were up 55% in 2021, at a gross margin of 70%. This growth is testament both to the outstanding grower benefits of the product and to the strength of our market access. Our suite of distribution partners was widened to include Nutrien, the world's largest agriculture retailer, in
The launch of Saori™ - the first "Vaccine for Plants"
After eight years of research and development, we were excited to launch our first PREtec product, Saori™, in
PREtecproduct pipeline
Following an investment of more than
People and sustainability
Summary and outlook
We have set out ambitious plans for organic growth, with revenue exceeding
Constant currency
We evaluate our results of operations on an as reported and constant currency basis. The constant currency presentation, which is a non-IFRS measure, excludes the impact of fluctuations in foreign currency exchange rates. We believe providing constant currency information provides valuable supplemental information regarding our results of operations, consistent with how we evaluate our performance. We calculate constant currency percentages by converting our prior-period local currency financial results using the current period exchange rates and comparing these adjusted amounts to our current period reported results.
Commercial business
Potential for significant revenue growth
Overall sales in 2021 were
2021 | 2020 | Growth | CC growth | |
$'000 | $'000 | percentage | percentage | |
2,774 | 1,657 | 67% | 67% | |
1,098 | 527 | 108% | 120% | |
EMEAA | 1,591 | 1,213 | 31% | 26% |
2,969 | 3,214 | (8%) | 12% |
Sales of core Harpin αβ products increased by 55% (53% in constant currency), driven by sales of greater than
Sales in
Harpin αβ sales in the
Sales of Harpin αβ for PHC in
In
EMEAA
2021 sales in the EMEAA region were up 31% with growth in
Plant Health Care Mexico has a broad biological product line for farmers in
New technology
PREtecpeptides: poised to enter large markets
PREtecPIPELINE
The PREtec technology platform is proving to be a reliable source for new products. The pipeline is poised to launch one new PREtec product each year going forward. All PREtec peptides are variants of naturally occurring proteins and break down rapidly in the environment, leaving no harmful residues on the crop or in the environment. The Group has a long history of offering products that support agricultural and environmental sustainability. The new products described below continue to meet the highest standards of sustainability.
The Company is on track to launch PHC279 (the active ingredient in Saori™) in the
A new liquid formulation of PHC279 has been developed, which is optimised for use as a seed treatment in row crops like corn and soybeans. This is expected to gain
The Group is confident that formulations of PHC279 represent a multi-million-dollar revenue opportunity in USA markets. Knowledge gained from these product launches will be leveraged with strategic partners to identify new countries and additional high value markets where these products can be introduced.
During 2021, following in the tracks laid by PHC279, we have been preparing to file a regulatory submission for a product based on PHC949. This was filed with the
In the
The Group expects long-term global sales of products based on PHC949 to reach into the tens of millions of dollars and become a significant value driver for the Group. Work is also continuing in the
In
The Group continues to invest in Saori™ to extend the label claims to cover plant diseases like Brown Spot and Target Spot. In 2023, the Group also plans to submit new registrations in
REST OF WORLD
Working with various multinational crop protection companies, opportunities to deploy PHC279, PHC949 and other PREtec products are being actively explored in
PREtec- Targeting markets with value greater than
2012-14
Discovery
• Build lab and team
• >800 peptides synthesised and screened in lab
• Mode of action studies
2015-17
IP secured
• Identified six lead products
• Initial field trials
• >50 patents filed; first patents granted in 2020
2017-19
Efficacy confirmed
• Testing in multiple crops in the
• PHC279 emerging as first champion
• Low-cost production process in lab
2020-21
Regulator submission
first launch
• Saori™ (PHC279) launch in
• Agreement for commercial scale low COGS production
•
• JDA with
2022-25
Accelerate launches
•
• Fourth quarter 2022 launch of PHC279 with
• Further JDAs and partnerships for multiple launches
• Product development in
Financial summary
Continued control of expenses and reduced working capital
A summary of the financial results for the year ended
2021 $'000 | 2020 $'000 | |
Revenue | 8,432 | 6,611 |
Gross profit | 5,003 | 3,683 |
Gross profit margin | 59% | 56% |
Operating loss | (6,381) | (3,568) |
Finance (expense)/income, net | (34) | 264 |
Net loss for the year before tax | (6,415) | (3,304) |
Adjusted LBITDA* | (4,618) | (3,304) |
Cash equivalents and investments | 9,162 | 4,149 |
Revenues
Revenues in 2021 increased by 28% to
The Group has three separate reporting segments as set out below.
The Group's revenue, gross margin and LBITDA are weighted towards the second half of the financial year. Revenue in the 1st half of the year is 40%, with the remainder being recognized in the second half.
This segment includes activities in both
Rest of world
Revenue in the Rest of World segment increased 31% (26% in constant currency) to
A significant portion of the Group's revenue comes from
Revenue in
Gross margin
Gross margin increased to 59% (2020: 56%). The increase was primarily due to increased sales of Harpin αβ in
Operating expenses
The Group raised equity to help accelerate our product launches, which caused expenses to increase to
Non-cash unallocated corporate expenses increased
Adjusted LBITDA, a non-GAAP measure, increased by
* Adjusted LBITDA: loss before interest, tax, depreciation, amortisation, share-based payments and intercompany foreign exchange.
2021 $'000 | 2020 $'000 | |
Operating loss | (6,381) | (3,568) |
Depreciation/amortisation | 567 | 639 |
Share-based payment expense | 572 | 596 |
Intercompany foreign exchange losses/(gains) | 624 | (971) |
Adjusted LBITDA | (4,618) | (3,304) |
Balance sheet
At
Inventory (
Translation of the results of foreign subsidiaries for inclusion within the consolidated Group results resulted in an exchange gain of
Cash flow and liquidity
The Company successfully raised £6.6 million (
Net cash used by investing was
Net cash provided by financing activities was
Going concern
In assessing whether the going concern basis is appropriate for preparing the 2021 annual report, the Directors have utilised the Group's detailed forecasts, which take into account its current and expected business activities, its cash and cash equivalents and its investments balance of
Consolidated statement of comprehensive income
for the year ended
Note | 2021 $'000 | 2020 $'000 | |
Revenue | 3 | 8,432 | 6,611 |
Cost of sales | (3,429) | (2,928) | |
Gross profit | 5,003 | 3,683 | |
Other income | - | 289 | |
Research and development expenses | (3,383) | (2,963) | |
Sales and marketing expenses | (3,677) | (2,876) | |
Administrative expenses | (4,324) | (1,701) | |
Operating loss | 4 | (6,381) | (3,568) |
Finance income | 27 | 295 | |
Finance expense | (61) | (31) | |
Loss before tax | (6,415) | (3,304) | |
Income tax credit | 111 | 80 | |
Loss for the year attributable to the equity holders of the parent company | (6,304) | (3,224) | |
Other comprehensive income | |||
Items which will or may be reclassified to profit or loss: | |||
Exchange gain/(loss) on translation of foreign operations | 468 | (1,211) | |
Total comprehensive loss for the year attributable to the equity holders of the parent company | (5,836) | (4,435) | |
Basic and diluted loss per share | 6 |
The accompanying notes are an integral part of these condensed consolidated financial statements
Consolidated statement of financial position
at
Note | 2021 $'000 | 2020 $'000 | |
Assets | |||
Non-current assets | |||
Intangible assets | 7 | 1,622 | 1,625 |
Property, plant and equipment | 8 | 718 | 246 |
Right-of-use assets | 843 | 970 | |
Trade and other receivables | 9 | 135 | 303 |
Total non-current assets | 3,318 | 3,144 | |
Current assets | |||
Inventories | 2,137 | 3,567 | |
Trade and other receivables | 9 | 3,364 | 2,778 |
Tax receivable | 229 | 251 | |
Investments | 8,157 | 3,167 | |
Cash and cash equivalents | 1,005 | 982 | |
Total current assets | 14,892 | 10,745 | |
Total assets | 18,210 | 13,889 | |
Liabilities | |||
Current liabilities | |||
Trade and other payables | 2,711 | 2,118 | |
Borrowings | 37 | 33 | |
Lease liabilities | 400 | 400 | |
Total current liabilities | 3,148 | 2,551 | |
Non-current liabilities | |||
Borrowings | 224 | 193 | |
Lease liabilities | 480 | 583 | |
Total non-current liabilities | 704 | 776 | |
Total liabilities | 3,852 | 3,327 | |
Total net assets | 14,358 | 10,562 | |
Share capital | 4,326 | 3,605 | |
Share premium | 100,859 | 92,520 | |
Foreign exchange reserve | (803) | (1,271) | |
Accumulated deficit | (90,024) | (84,292) | |
Total equity | 14,358 | 10,562 |
The accompanying notes are an integral part of these condensed consolidated financial statements
Consolidated statement of changes in equity
for the year ended
Share capital $'000 | Share premium $'000 | Foreign exchange reserve $'000 | Accumulated deficit $'000 | Total $'000 | ||
Balance at | 3,030 | 88,647 | (60) | (81,664) | 9,953 | |
Loss for the year | - | - | - | (3,224) | (3,224) | |
Exchange difference arising on translation of foreign operations | - | - | (1,211) | - | (1,211) | |
Total comprehensive loss | - | - | (1,211) | (3,224) | (4,435) | |
Shares issued net of issue costs | 575 | 3,873 | - | - | 4,448 | |
Share-based payments | - | - | - | 596 | 596 | |
Balance at | 3,605 | 92,520 | (1,271) | (84,292) | 10,562 | |
Loss for the year | - | - | - | (6,304) | (6,304) | |
Exchange difference arising on translation of foreign operations | - | - | 468 | - | 468 | |
Total comprehensive income/(loss) | - | - | 468 | (6,304) | (5,836) | |
Shares issued net of issue costs | 721 | 8,339 | - | - | 9,060 | |
Share-based payments | - | - | - | 572 | 572 | |
Balance at | 4,326 | 100,859 | (803) | (90,024) | 14,358 |
The accompanying notes are an integral part of these condensed consolidated financial statements
Consolidated statement of cash flows
for the year ended
Note | 2021 $'000 | 2020 $'000 | |
Cash flows from operating activities | |||
Loss for the year | (6,304) | (3,224) | |
Adjustments for: | |||
Depreciation | 8 | 132 | 277 |
Depreciation of right-of-use assets | 432 | 338 | |
Amortization of intangibles | 7 | 3 | 24 |
Share-based payment expense | 572 | 596 | |
Finance income | (27) | (295) | |
Finance expense | 61 | 31 | |
Foreign exchange loss/(gain) | 624 | (1,015) | |
Income taxes credit | (111) | (80) | |
Bad debt expense | 33 | - | |
(Increase)/decrease in trade and other receivables | (499) | 598 | |
Gain on disposal of fixed asset | (20) | (11) | |
Decrease/(increase) in inventories | 1,349 | (607) | |
Increase in trade and other payables | 406 | 711 | |
Income taxes received | 134 | 165 | |
Net cash used in operating activities | (3,215) | (2,492) | |
Investing activities | |||
Purchase of property, plant and equipment | 8 | (382) | (15) |
Sale of property, plant and equipment | 8 | 20 | 11 |
Finance income | 2 | 159 | |
Purchase of investments | (8,048) | (2,756) | |
Sale of investments | 3,056 | 1,404 | |
Net cash used in investing activities | (5,352) | (1,197) | |
Financing activities | |||
Finance expense | (9) | (4) | |
Payment of lease liability | (465) | (389) | |
Issue of ordinary share capital | 9,029 | 4,449 | |
Exercise of options | 31 | - | |
Borrowings | 36 | 174 | |
Net cash provided by financing activities | 8,622 | 4,230 | |
Net increase in cash and cash equivalents | 55 | 541 | |
Cash and cash equivalents at the beginning of period | 982 | 457 | |
Effects of exchange rates on cash held | (32) | (16) | |
Cash and cash equivalents at the end of the period | 1,005 | 982 |
The accompanying notes are an integral part of these condensed consolidated financial statements
Notes to the condensed consolidated financial statements
for the year ended
1. Basis of preparation
The financial information set out in this document does not constitute the Group's statutory accounts for the years ended
Statutory accounts for the year ended
The financial information set out in these results has been prepared using the recognition and measurement principles of International Accounting Standards, International Financial Reporting Standards and Interpretations in conformity with
Reporting currency
While the functional currency of the parent company is Sterling, the Group's financial statements have been presented in US Dollars. The Directors believe this better reflects the underlying nature of the business, primarily due to the
Rates as of 31 December | ||||
GBP | Mexican Peso | Euro | Reals | |
2020 | 1.3649 | 0.0503 | 1.2264 | 0.1924 |
2021 | 1.3510 | 0.0489 | 1.1342 | 0.1794 |
Average exchange rates | ||||
GBP | Mexican Peso | Euro | Reals | |
2020 | 1.2834 | 0.0468 | 1.1414 | 0.1958 |
2021 | 1.3754 | 0.0493 | 1.1830 | 0.1855 |
Going concern
In assessing whether the going concern basis is an appropriate basis for preparing the 2021 annual report, the Directors have utilized detailed forecasts which take into account the Group's current and expected business activities, its cash and cash equivalents balance and investments of
The consolidated financial statements have been prepared on a going concern basis. The Directors have, at the time of approving the financial statements, a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. The Covid-19 pandemic has so far had limited impact on our business and the Board believes that the business is able to navigate through the continued impact of the Covid-19 pandemic and any macroeconomic impact of the ongoing situation in
As a consequence, various sensitivity analyses have been performed to reflect a variety of possible cash flow scenarios and also to consider the likelihood of this scenario occurring. Overall, these cash flow forecasts, which cover a period of at least 12 months from the date of approval of the financial statements, foresee that the Group will be able to operate within its existing facilities. Nevertheless, there is a risk that the Group will be impacted more than expected by reductions in customer confidence. If sales and settlement of existing debts are not in line with cash flow forecasts, the Directors have the ability to identify cost savings if necessary, to help mitigate the impact on cash outflows. Having assessed the principal risks and the other matters discussed in connection with the going concern statement, the Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. For these reasons, they continue to adopt the going concern basis of accounting in preparing the financial information.
2. Critical accounting estimates and judgements
In preparing its financial statements, the Group makes certain estimates and judgements regarding the future. Estimates and judgements are continually evaluated based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. In the future, actual experience may differ from estimates and assumptions. The estimates and judgements that have a risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.
Impairment of goodwill
The Group tests whether goodwill has suffered any impairment on an annual basis. The recoverable amount is determined based on value-in-use calculations. The use of this method requires the estimation of future cash flows and the choice of a discount rate in order to calculate the present value of the cash flows. Actual outcomes may vary.
Impairment of intangible assets (excluding goodwill)
At the end of the financial period, the Group reviews the carrying amounts of its definite lived intangible assets to determine whether there is any indication that those assets have suffered any impairment loss. If any such indication exists, the recoverable amount of the asset is estimated to determine the extent of the impairment loss (if any).
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing the value in use, the estimated future cash flows are discounted to their net present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset.
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 recognized immediately within administrative expenses in the consolidated statement of comprehensive income.
Revenue
The Group recognizes revenue at the fair value of consideration received or receivable. Sales of goods to external customers are at invoiced amounts less value-added tax or local tax on sales. The Group currently generates revenue solely within its Commercial business through the sale of its proprietary and third-party products. When the Group makes product sales under contracts/agreements these will frequently be inclusive of rebate/support payments or a financing component where judgement can be required in the assessment of the transaction price.
Recoverability of trade receivables
The Group applies both the simplified and general approaches under IFRS 9 to measure expected credit losses using a lifetime expected credit loss provision for trade receivables. Under the simplified approach, expected credit losses on a collective basis, trade receivables are grouped based on credit risk and ageing. Given the Group has a low history of default, limited judgement is required for trade receivables in this grouping.
The Group then separately reviews those receivables with payment terms over 180 days using the general approach. Under this approach judgements are required in the assessment of the risk and probability of credit losses and the quantum of the loss in the event of a default. The Group has debtors with a gross value (before provisioning but after the assessment of financing components) of
3. Revenue
Revenue arises from | 2021 $'000 | 2020 $'000 |
Proprietary products | 6,096 | 3,869 |
Third-party products | 2,336 | 2,742 |
Total | 8,432 | 6,611 |
The following table gives an analysis of revenue according to sales with payment terms of less than or more than 180 days.
Year to
Sales contracts with payment terms less than 180 days | Sales contracts with payment terms greater than 180 days | Total | |
Segment | $'000 | $'000 | $'000 |
2,969 | - | 2,969 | |
3,510 | 362 | 3,872 | |
Rest of World | 1,591 | - | 1,591 |
8,070 | 362 | 8,432 |
Sales contracts with payment terms less than 180 days | Sales contracts with payment terms greater than 180 days | Total | |
Timing of transfer of goods | $'000 | $'000 | $'000 |
Point in time (delivery to port of departure) | 7,862 | 362 | 8,224 |
Point in time (delivery to port of arrival) | 208 | - | 208 |
8,070 | 362 | 8,432 |
Year to
Sales contracts with payment terms less than 180 days | Sales contracts with payment terms greater than 180 days | Total | |
Segment | $'000 | $'000 | $'000 |
3,214 | - | 3,214 | |
2,017 | 167 | 2,184 | |
Rest of World | 1,213 | - | 1,213 |
6,444 | 167 | 6,611 |
Sales contracts with payment terms less than 180 days | Sales contracts with payment terms greater than 180 days | Total | |
Timing of transfer of goods | $'000 | $'000 | $'000 |
Point in time (delivery to port of departure) | 6,166 | 167 | 6,333 |
Point in time (delivery to port of arrival) | 278 | - | 278 |
6,444 | 167 | 6,611 |
Financing component of sales contracts | $'000 |
At | 9 |
Financing components recognized | - |
Financing components unwound to the income statement | (9) |
At | - |
4. Operating loss
Note | 2021 $'000 | 2020 $'000 | |
Operating loss is arrived at after charging/(crediting): | |||
Share-based payment charge | 572 | 596 | |
Depreciation | 9 | 132 | 277 |
Depreciation of right-of-use assets | 432 | 338 | |
Amortization of intangibles | 8 | 3 | 24 |
Operating lease expense | 36 | 26 | |
Gain on disposal of property, plant and equipment | (20) | (11) | |
Impairment of trade receivables | 33 | (123) | |
Foreign exchange losses/ (gains) | 624 | (971) | |
Other income* | - | (289) | |
Auditor's remuneration: | |||
Amounts for audit of parent company and consolidation | 115 | 100 | |
Amounts for audit of subsidiaries | 60 | 45 | |
Total auditor's remuneration | 175 | 145 |
* Under the
5. Segment information
The Group's CODM views, manages and operates the Group's business segments according to its strategic business focuses - Commercial and PREtec. The CODM further analyses the results and operations of the Group's Commercial business on a geographical basis; therefore the Group has presented separate geographic segments within its Commercial business as follows: Commercial -
Below is information regarding the Group's segment loss information for the year ended:
2021 | $'000 | $'000 | Rest of World $'000 | Eliminations $'000 | Total Commercial $'000 | PREtec $'000 | Total $'000 |
Revenue* | |||||||
Proprietary product sales | 3,836 | 695 | 1,565 | - | 6,096 | - | 6,096 |
Third-party product sales | 36 | 2,274 | 26 | - | 2,336 | - | 2,336 |
Inter-segment product sales | 853 | - | 45 | (898) | - | - | - |
Total revenue | 4,725 | 2,969 | 1,636 | (898) | 8,432 | - | 8,432 |
Cost of sales | (2,232) | (1,560) | (535) | 898 | (3,429) | - | (3,429) |
Research and development | - | - | - | - | - | (2,645) | (2,645) |
Sales and marketing | (1,878) | (760) | (772) | - | (3,410) | (242) | (3,652) |
Administration | (900) | (213) | (94) | - | (1,207) | (198) | (1,405) |
Non-cash expenses: | |||||||
Depreciation | (128) | (87) | (21) | - | (236) | (335) | (572) |
Amortisation | - | - | (3) | - | (3) | - | (3) |
Share-based payment | (64) | - | (22) | - | (86) | (246) | (332) |
Segment operating (loss)/profit | (477) | 349 | 189 | - | 61 | (3,666) | (3,606) |
Corporate expenses:** | |||||||
Wages and professional fees | (2,045) | ||||||
Administration*** | (730) | ||||||
Operating loss | (6,381) | ||||||
Finance income | 27 | ||||||
Finance expense | (61) | ||||||
Loss before tax | (6,415) |
* Revenue from one customer within the
Revenue from one customer within the
Revenue from one customer within the
Revenue from one customer within the
** These amounts represent public company expenses for which there is no reasonable basis by which to allocate the amounts across the Group's segments.
*** Includes net share-based payment expense of
Other segment information | $'000 | $'000 | Rest of World $'000 | Eliminations $'000 | Total Commercial $'000 | PREtec $'000 | Total $'000 |
Segment assets | 13,571 | 2,221 | 1,465 | - | 17,257 | 953 | 18,210 |
Segment liabilities | 1,976 | 328 | 346 | - | 2,650 | 1,202 | 3,852 |
Capital expenditure | 124 | 106 | - | - | 230 | 374 | 604 |
2020 | $'000 | $'000 | Rest of World $'000 | Eliminations $'000 | Total Commercial $'000 | PREtec $'000 | Total $'000 |
Revenue* | |||||||
Proprietary product sales | 2,160 | 605 | 1,104 | --- | 3,869 | - | 3,869 |
Third-party product sales | 24 | 2,609 | 109 | - | 2,742 | - | 2,742 |
Inter-segment product sales | 1,383 | - | 634 | (2,017) | - | - | - |
Total revenue | 3,567 | 3,214 | 1,847 | (2,017) | 6,611 | - | 6,611 |
Cost of sales | (2,109) | (1,746) | (1,090) | 2,017 | (2,928) | - | (2,928) |
Other income** | 289 | - | - | - | 289 | - | 289 |
Research and development | - | - | - | - | - | (2,135) | (2,135) |
Sales and marketing | (1,318) | (664) | (735) | - | (2,717) | (257) | (2,974) |
Administration | (722) | (224) | (8) | - | (954) | (144) | (1,098) |
Non-cash expenses: | |||||||
Depreciation | (98) | (68) | (16) | - | (182) | (443) | (625) |
Amortisation | (18) | - | (5) | - | (23) | - | (23) |
Share-based payment | (49) | - | (36) | - | (85) | (381) | (466) |
Segment operating (loss)/profit | (458) | 512 | (43) | - | 11 | (3,360) | (3,349) |
Corporate expenses:*** | |||||||
Wages and professional fees | (1,146) | ||||||
Administration**** | 927 | ||||||
Operating loss | (3,568) | ||||||
Finance income | 295 | ||||||
Finance expense | (31) | ||||||
Loss before tax | (3,304) |
* Revenue from one customer within the
Revenue from one customer within the
** Under the
*** These amounts represent public company expenses for which there is no reasonable basis by which to allocate the amounts across the Group's segments.
**** Includes net share-based payment expense of
Other segment information | $'000 | $'000 | Rest of World $'000 | Eliminations $'000 | Total Commercial $'000 | PREtec $'000 | Total $'000 |
Segment assets | 8,574 | 2,269 | 2,135 | - | 12,978 | 911 | 13,889 |
Segment liabilities | 1,447 | 597 | 307 | - | 2,351 | 976 | 3,327 |
Capital expenditure | 42 | 1 | 1 | - | 44 | 4 | 48 |
Segment assets include all operating assets used by a segment and consist principally of operating cash, receivables, inventories, property, plant and equipment and intangible assets, net of allowances and provisions. Segment liabilities include all operating liabilities and consist principally of trade payables and accrued liabilities.
Geographic information
The Group operates in five principal countries - the
The Group's revenues from customers by location of operation are detailed below:
Year ended | Year ended | ||||
% Amount$'000 | % Amount$'000 | ||||
349 | 4 | 285 | 4 | ||
2,774 | 33 | 1,657 | 25 | ||
2,969 | 35 | 3,214 | 49 | ||
1,242 | 15 | 928 | 14 | ||
1,098 | 13 | 527 | 8 | ||
Total | 8,432 | 100 | 6,611 | 100 |
The Group's non-current assets by location of assets are detailed below:
Year ended | Year ended | ||||
% Amount$'000 | % Amount$'000 | ||||
3 | - | 7 | - | ||
3,074 | 93 | 2,734 | 87 | ||
213 | 6 | 208 | 7 | ||
17 | 1 | 40 | 1 | ||
11 | - | 155 | 5 | ||
Total | 3,318 | 100 | 3,144 | 100 |
6. Loss per share
Basic loss per ordinary share has been calculated on the basis of the loss for the year of
Equity instruments of 26,770,302 (2020: 22,953,802), which include share options, and the 2017 Employee Share Option Plan could potentially dilute basic earnings per share in the future have been considered but not included in the calculation of diluted earnings per share because they are anti-dilutive for the periods presented. This is due to the Group incurring a loss on operations for the year.
7. Intangible assets
$'000 | Licenses and registrations $'000 | Trade name and customer relationships $'000 | Total $'000 | |
Cost | ||||
Balance at | 1,620 | 3,342 | 159 | 5,121 |
Additions - externally acquired | - | - | - | - |
Balance at | 1,620 | 3,342 | 159 | 5,121 |
Additions - externally acquired | - | - | - | - |
Balance at | 1,620 | 3,342 | 159 | 5,121 |
Accumulated amortization | ||||
Balance at | - | 3,313 | 159 | 3,472 |
Amortization charge for the year | - | 24 | - | 24 |
Balance at | - | 3,337 | 159 | 3,496 |
Amortization charge for the year | - | 3 | - | 3 |
Balance at | - | 3,340 | 159 | 3,499 |
Net book value | ||||
At | 1,620 | 5 | - | 1,625 |
At | 1,620 | 2 | - | 1,622 |
The intangible asset balances have been tested for impairment using discounted budgeted cash flows of the relevant cash generating units. For the years ended
Licenses and registrations
These amounts represent the cost of licenses and registrations acquired in order to market and sell the Group's products internationally across a wide geography. These amounts are amortized evenly according to the straight-line method over the term of the license or registration. Impairment is reviewed and tested according to the method expressed above. Licences and registrations have a weighted average remaining amortisation period of one year. No impairment charge is considered necessary, and no reasonable possible change in key assumptions used would lead to an impairment in the carrying value of licences and registrations.
8. Property, plant and equipment
Office and facility equipment $'000 | Leasehold improvements $'000 | Vehicles $'000 | Total $'000 | |
Cost | ||||
Balance at | 1,254 | 819 | 392 | 2,465 |
Additions | 11 | - | 37 | 48 |
Disposals | (2) | - | (34) | (36) |
Balance at | 1,263 | 819 | 395 | 2,477 |
Additions | 384 | 45 | 175 | 604 |
Disposals | - | - | (64) | (64) |
Balance at | 1,647 | 864 | 506 | 3,017 |
Accumulated depreciation | ||||
Balance at | 1,011 | 683 | 296 | 1,990 |
Depreciation charge for the year | 101 | 136 | 40 | 277 |
Disposals | (2) | - | (34) | (36) |
Balance at | 1,110 | 819 | 302 | 2,231 |
Depreciation charge for the year | 63 | 2 | 67 | 132 |
Disposals | - | - | (64) | (64) |
Balance at | 1,173 | 821 | 305 | 2,299 |
Net book value | ||||
At | 153 | - | 93 | 246 |
At | 474 | 43 | 201 | 718 |
9. Trade and other receivables
2021 $'000 | 2020 $'000 | |
Current | ||
Trade receivables | 3,114 | 2,494 |
Less: provision for impairment | (132) | (84) |
Trade receivables, net | 2,982 | 2,410 |
Other receivables and prepayments | 382 | 368 |
Current trade and other receivables | 3,364 | 2,778 |
Non-current | ||
Trade receivables | - | 164 |
Less: provision for impairment | - | (15) |
Trade receivables, net | - | 149 |
Other receivables | 59 | 69 |
Deferred tax asset | 76 | 85 |
Non-current trade and other receivables | 135 | 303 |
3,499 | 3,081 |
The trade receivable current balance represents trade receivables with a due date for collection within a one-year period.
The other receivable non-current balance represents lease deposits.
The Group applies the IFRS 9 simplified approach to measuring expected credit losses for sales contracts with 180 days or fewer payment terms. To measure expected credit losses on a collective basis, trade receivables and contract assets are grouped based on similar credit risk and ageing. The expected loss rates are based on the aging of the receivable, past experience of credit losses with customers and forward-looking information. An allowance for a receivable's estimated lifetime expected credit losses is first recorded when the receivable is initially recognized, and subsequently adjusted to reflect changes in credit risk until the balance is collected. In the event that management considers that a receivable cannot be collected, the balance is written off.
Sales contract receivables provided on terms greater than 180 days are at first discounted to recognize the financing component of the transaction and then assessed using the "general approach". Under this approach, the Group models and probability weights a number of scenarios based on their assessment of the credit risk and historical expected losses.
Considered under the simplified approach $'000 | Considered under the general approach $'000 | |
Trade receivables | 2,385 | 729 |
Expected credit loss assessed | - | (132) |
2,385 | 597 |
The receivables considered under the general approach relate to one customer in the
The maximum exposure to credit risk at the reporting date is the fair value of each class of receivables set out above.
Movements on the provision for impairment of trade receivables are as follows:
2021 $'000 | 2020 $'000 | |
Balance at the beginning of the year | 99 | 264 |
Provided | 50 | - |
Receivables written off as uncollectible | - | (42) |
Unused amounts reversed | (15) | (123) |
Foreign exchange | (2) | - |
Balance at the end of the year | 132 | 99 |
The net value of trade receivables for which a provision for impairment has been made is
The following is an analysis of the Group's trade receivables, both current and past due, identifying the totals of trade receivables which are not yet due and those which are past due but not impaired.
2021 $'000 | 2020 $'000 | |
Current | 2,611 | 2,199 |
Past due: | ||
Up to 30 days | 34 | 8 |
31 to 60 days | 2 | - |
61 to 90 days | 78 | - |
Greater than 90 days | 257 | 352 |
Total | 2,982 | 2,559 |
10. Cautionary statement
This document contains certain forward-looking statements relating to
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