Bioventix Plc Final Results

 
TIDMBVXP 
 
Bioventix plc 
 
                        ("Bioventix" or the "Company") 
 
              Preliminary results for the year ended 30 June 2017 
 
Bioventix plc (BVXP), a UK company specialising in the development and 
commercial supply of high-affinity monoclonal antibodies for applications in 
clinical diagnostics, announces its audited results for the year ended 30 June 
2017. 
 
Highlights: 
 
·     Revenue up 31% to GBP7.2 million 
 
·     Profit before tax up 37% to GBP5.7 million 
 
·     Cash up GBP0.8 million to GBP6.1 million 
 
·     Second interim dividend of 31p per share (2016: 26p) 
 
·     Special dividend of 40p per share 
 
Business review 
 
We are pleased to report another set of excellent results for the financial 
year ended 30 June 2017. Most significantly, revenues for the year of GBP7.2 
million (2015/16: GBP5.5 million) were ahead of expectations and up 31% on the 
previous year. This revenue increase, when coupled to a modest increase in 
costs has resulted in increased profits after tax of GBP4.9 million, 40% up on 
the 2015/16 figure of GBP3.5 million. Despite increased dividend distribution, 
cash balances during the year increased by GBP0.8 million to GBP6.2 million. 
 
Currently, our most significant revenue stream comes from the vitamin D 
antibody called vitD3.5H10. This antibody is used by a number of small, medium 
and large diagnostic companies around the world for use in vitamin D deficiency 
testing. Sales of vitD3.5H10 increased by 24% to GBP2.75 million during the year. 
This surpassed our expectations based on customer feedback during the year. Our 
expectation was that, whilst test volumes are increasing globally, price 
pressure (i.e. $/test prices achieved) would balance the increase in volume 
leading to a relatively flat total market in US Dollars. This feedback set our 
expectations for royalties received after 30 June 2017 (but relating to the 
reporting period). Actual royalties received were in excess of these 
expectations. 
 
Our prudent belief is that the vitamin D market will plateau in the near 
future. Nevertheless, we anticipate a modest further increase in vitamin D 
antibody sales over the next year as a limited number of smaller customers 
bring new vitamin D products to the market. 
 
We reported in May that our troponin (heart attack diagnostic) partner, Siemens 
Healthineers, released a new test outside the US market that helps facilitate a 
faster diagnosis of patients presenting with chest pain in an A&E setting. The 
rate at which this new test will be adopted by Siemens customers in hospitals 
in the EU, Asia and elsewhere outside the US is unfortunately not something of 
which we have detailed knowledge. Whilst it is clear that a quicker test will 
be of benefit to patients, clinicians and hospital budget holders, it is also 
clear that there is likely to be an education period during which clinicians 
become comfortable with a significant change in diagnostic practices that can 
result in non MI (i.e. patients not having a heart attack) being released from 
A&E much earlier. We will develop a better understanding of this matter during 
2018. 
 
The revenues resulting from the success of the Siemens troponin project will be 
important in replacing approximately GBP1 million of NT proBNP sales that will be 
lost from the 2017/18 accounts due to the termination of a specific technology 
license. 
 
Many of the established "core" antibodies also enjoyed increased sales in the 
year. Quantitatively, these were: 
 
*              testosterone: approximately GBP600k(+12%); 
 
*              T3: approximately GBP500k(+33%); 
 
*              drug antibodies: approximately GBP500k(+50%); 
 
*              estradiol: approximately GBP300k(+30%); 
 
*              progesterone: approximately GBP200k(+51%). 
 
This healthy increase in these core antibodies that are sold to a number of 
customers in many countries does not have a single explanation over and above 
the 5 10% increase in the global diagnostics industry that is reported by third 
party analysts. The drug testing antibody portfolio also features a handful of 
antibodies to different drugs used by different customers for different 
applications (e.g. EtG for alcohol testing, THC for cannabis testing). The 
increase in sales within this group has been accompanied by a significant 
increase in physical antibody sales in milligrams. 
 
Future developments 
 
Our shipments of physical antibody to China continued to increase. Some sales 
are made directly but the majority are made through five appointed 
distributors. The emergence of new Chinese diagnostic companies continues at a 
high rate and is a reflection of the embryonic stage of development of this 
industry in China. Technical expertise at these customers is variable but we do 
now see many examples of customers who are able to identify the benefit of our 
excellent antibodies if used correctly. We remain cautiously optimistic that 
these continued physical antibody sales will result in royalty streams into the 
future. 
 
As mentioned above, the commercial development of the new troponin project at 
Siemens will have a significant influence on Bioventix sales next year and the 
years beyond. Whilst there are no antibodies in the future pipeline that are 
near troponin in potential value, modest contributions towards revenue growth 
are anticipated to come from androstenedione in the financial year 2018/19 and 
T4 (thyroxine) in the years following androstenedione. 
 
Also in the future pipeline, we have four contract R&D projects where 
antibodies have already been created and despatched to contract partners for 
evaluation within their own R&D departments. These projects are in the fields 
of cancer, thyroid diagnostics, viral diagnostics and a certain vitamin/ 
deficiency. They are all of modest potential value but if technically 
successful, capable of contributing towards revenues into the future. 
 
On a longer term perspective, we continue to work with our partners in Norway 
on the secretoneurin (CardiNor & heart diagnostics) and amyloid projects (Pre 
Diagnostics & dementia). We have made exciting antibodies to contribute towards 
the scientific development of these projects and we look forward to developing 
the science of these long term projects over the coming years. It is our 
intention to seek additional long term projects of this kind with early stage 
research groups where we believe there to be compatibility with our skills and 
objectives. 
 
Our revenues continue to be dominated by US dollars and Euros. We have 
commented in recent reports on the effect of post Brexit referendum exchange 
rates on our revenues in the absence of any hedging mechanisms. The last half 
year to be subjected to pre referendum exchange rates was 2H.2015 and so these 
effects have largely receded into the past and will not affect like for like 
comparisons going forward. We have no current plans to institute any hedging 
mechanisms and therefore any future changes in exchange rates, up or down will 
impact revenues accordingly. 
 
Within the field of antibodies, technology changes relatively slowly as new 
antibody technologies are validated and used. Such technologies include rabbit 
monoclonal antibodies and novel "synthetic" antibodies. For example, we are 
aware that rabbit monoclonal antibody technology is established at some 
customers and this could have resulted in lost opportunities for our sheep 
monoclonal approach. However, we believe that having established our antibodies 
in customer products over the last ten years or so leaves our core business 
relatively secure due to the significant barriers to changing an antibody that 
works well in a diagnostic test. 
 
The composition of the Bioventix team has remained stable over the year 
facilitating excellent performance and know how retention. This total head 
count of 13 full time equivalents is expected to remain largely unchanged as 
this adequately serves our manufacturing and research needs. 
 
The continued outstanding performance of the Company in a globally competitive 
market for antibodies is very satisfying. Our sheep monoclonal antibody 
technology continually delivers high performance antibodies to our customers. 
However, the operation of the antibody technology is made possible by the 
efforts of our expert staff and we would like to thank them for their 
remarkable achievements over the last year. 
 
Dividend policy 
 
The healthy performance of the business during the year has resulted in 
increased cash balances (increased to GBP6.2 million from GBP5.4 million) despite 
increased dividend distribution during the year. Over previous years, the Board 
has followed a cautious dividend policy that embraces continuity and it is the 
general intention of the Board to continue with this policy into the future. 
For the current year, the Board is pleased to announce a second interim 
dividend of 31 pence per share which, when added to the first interim dividend 
of 20 pence per share makes a total of 51 pence per share for the current 
year. 
 
Our current view is that a cash balance of approximately GBP5 million is 
sufficient to facilitate operational and strategic agility with respect to 
possible corporate or technological opportunities that could arise in the 
foreseeable future. On this occasion, we have decided to distribute some 
surplus cash that is in excess of anticipated needs and accordingly, we are 
pleased to announce a special dividend of 40 pence per share. 
 
Accordingly dividends totalling 71 pence per share will be paid. The shares 
will be marked ex dividend on 26 October 2017 and the dividend will be paid on 
10 November 2017 to shareholders on the register at close of business on 27 
October 2017. 
 
Conclusion 
 
We are delighted to be able to report such positive news for the current year. 
For the financial year 2017/18, our challenge will be to make up for the 
approximately GBP1 million of lost sales mentioned above with revenues from the 

newly launched Siemens troponin project and modest growth from additional 
vitamin D antibody sales and royalties. Beyond that, growth in the period 2018/ 
2020 will be linked to our troponin project and the success of Siemens in their 
product launches around the world. We continue our research activities as we 
look to seed additional projects that will germinate in the period 2020/2030 
creating additional shareholder value. 
 
For further information please contact: 
 
Bioventix plc                                     Tel: [phone] 
Peter Harrison           Chief Executive Officer 
 
finnCap Ltd                                       Tel: [phone] 
Geoff Nash/Simon Hicks   Corporate Finance 
Stephen Norcross         Corporate Broking 
 
About Bioventix plc: 
 
Bioventix (www.bioventix.com) specialises in the development and commercial 
supply of high-affinity monoclonal antibodies with a primary focus on their 
application in clinical diagnostics, such as in automated immunoassays used in 
blood testing. The antibodies created at Bioventix are generated in sheep and 
are of particular benefit where the target is present at low concentration and 
where conventional monoclonal or polyclonal antibodies have failed to produce a 
suitable reagent. Bioventix currently offers a portfolio of antibodies to 
customers for both commercial use and R&D purposes, for the diagnosis or 
monitoring of a broad range of conditions, including heart disease, cancer, 
fertility, thyroid function and drug abuse. Bioventix currently supplies 
antibody products and services to the majority of multinational clinical 
diagnostics companies. Bioventix is based in Farnham, UK and its shares are 
traded on AIM under the symbol BVXP. 
 
The information communicated in this announcement contains inside information 
for the purposes of Article 7 of the Market Abuse Regulation (EU) No. 596/2014. 
 
STATEMENT OF COMPREHENSIVE INCOME 
 
FOR THE YEARED 30 JUNE 2017 
 
                                                                              2017          2016 
 
                                                                                 GBP             GBP 
 
Turnover                                                                 7,245,862     5,517,217 
 
Cost of sales                                                            (494,880)     (494,880) 
 
Gross profit 
                                                                         6,750,982     5,022,337 
 
Administrative expenses                                                  (998,797)     (839,233) 
 
Share option charge                                                       (67,005)      (53,225) 
 
Difference on foreign exchange                                               5,747        75,512 
 
Research & development tax credit adjustment                                25,335             - 
 
Operating profit                                                         5,716,262     4,205,391 
 
Interest receivable and similar income                                      55,578        13,694 
 
Interest payable and expenses                                                    -         (164) 
 
Profit before tax                                                        5,771,840     4,218,921 
 
Tax on profit                                                            (849,551)     (724,493) 
 
Profit for the financial year                                            4,922,289     3,494,428 
 
            There were no recognised gains and losses for 2017 or 2016 other than those 
                                     included in the statement of comprehensive income. 
 
 
                                                                             Earnings per share: 
 
                                                                              2017          2016 
 
      Basic                                                                 96.36p        69.18p 
 
      Diluted                                                               94.70p        67.95p 
 
 
STATEMENT OF FINANCIAL POSITION 
 
AS AT 30 JUNE 2017 
 
                                                          2017                  2016 
 
                                                             GBP                     GBP 
 
Fixed assets 
 
Tangible assets                                        449,312               467,087 
 
Investments                                            195,560                43,330 
 
                                                       644,872               510,417 
 
Current assets 
 
Stocks                                      226,174               198,933 
 
Debtors: amounts falling due              3,342,692             2,685,475 
within one year 
 
Cash at bank and in hand                  6,166,940             5,380,405 
 
                                          9,735,806             8,264,813 
 
Creditors: amounts falling due            (219,944)             (549,908) 
within one year 
 
Net current assets                                   9,515,862             7,714,905 
 
Total assets less current 
liabilities                                         10,160,734             8,225,322 
 
Provisions for liabilities 
 
Deferred tax                               (16,114)              (17,949) 
 
 
                                                      (16,114)              (17,949) 
 
Net assets                                          10,144,620             8,207,373 
 
Capital and reserves 
 
Called up share capital                                256,934               252,547 
 
Share premium account                                  395,108                78,426 
 
Capital redemption reserve                               1,231                 1,231 
 
Profit and loss account                              9,491,347             7,875,169 
 
                                                    10,144,620             8,207,373 
 
 
STATEMENT OF CHANGES IN EQUITY 
 
FOR THE YEARED 30 JUNE 2017 
 
                             Called up       Share     Capital  Profit and       Total 
                                 share     premium  redemption        loss      equity 
                               capital     account     reserve     account 
 
                                     GBP           GBP           GBP           GBP           GBP 
 
At 1 July 2016                 252,547      78,426       1,231   7,875,169   8,207,373 
 
Comprehensive income for 
the year 
 
Profit for the year                  -           -           -   4,922,289   4,922,289 
 
Other comprehensive income           -           -           -           -           - 
for the year 
 
Total comprehensive income           -           -           -   4,922,289   4,922,289 
for the year 
 
Dividends: Equity capital            -           -           - (3,373,116) (3,373,116) 
 
Shares issued during the         4,387     316,682           -           -     321,069 
year 
 
Share option charge                  -           -           -      67,005      67,005 
 
Total transactions with          4,387     316,682           - (3,306,111) (2,985,042) 
owners 
 
At 30 June 2017                256,934     395,108       1,231   9,491,347  10,144,620 
 
STATEMENT OF CHANGES IN EQUITY 
 
FOR THE YEARED 30 JUNE 2016 
 
                             Called up       Share     Capital  Profit and       Total 
                                 share     premium  redemption        loss      equity 
                               capital     account     reserve     account 
 
                                     GBP           GBP           GBP           GBP           GBP 
 
At 1 July 2015                 252,547      78,426       1,231   6,251,921   6,584,125 
 
Comprehensive income for 
the year 
 
Profit for the year                  -           -           -   3,494,428   3,494,428 
 
Other comprehensive income           -           -           -           -           - 
for the year 
 
Total comprehensive income           -           -           -   3,494,428   3,494,428 
for the year 
 
Dividends: Equity capital            -           -           - (1,924,405) (1,924,405) 
 
Share option charge                  -           -           -      53,225      53,225 
 
Total transactions with              -           -           - (1,871,180) (1,871,180) 
owners 
 
At 30 June 2016                252,547      78,426       1,231   7,875,169   8,207,373 
 
 
STATEMENT OF CASH FLOWS 
 
FOR THE YEARED 30 JUNE 2017 
 
                                                                     2017       2016 
 
                                                                        GBP          GBP 
 
Cash flows from operating activities 
 
Profit for the financial year                                   4,922,289  3,494,428 
 
Adjustments for: 
 
Depreciation of tangible assets                                    39,479     41,729 
 
Interest paid                                                           -        164 
 
Interest received                                                (55,578)   (13,694) 
 
Taxation charge                                                   849,551    724,493 
 
(Increase) in stocks                                             (27,240)    (5,963) 
 
(Increase) in debtors                                           (621,581)  (594,901) 
 
Increase in creditors                                              78,840     19,558 
 
Corporation tax (paid)                                        (1,265,505)  (494,039) 
 
Other tax movements                                              (30,323)          - 
 
Net cash generated from operating activities                    3,889,932  3,171,775 
 
Cash flows from investing activities 
 
Purchase of tangible fixed assets                                (21,703)   (21,012) 
 
Purchase of unlisted and other investments                      (152,230)   (43,330) 
 
Interest received                                                  55,578     13,694 
 
Share option charge                                                67,005     53,225 
 

Net cash from investing activities                               (51,350)      2,577 
 
 
 
Cash flows from financing activities 
 
Issue of ordinary shares                                          321,069           - 
 
Dividends paid                                                (3,373,116) (1,924,405) 
 
Interest paid                                                           -       (164) 
 
Net cash used in financing activities                         (3,052,047) (1,924,569) 
 
Net increase in cash and cash equivalents                         786,535   1,249,783 
 
Cash and cash equivalents at beginning of year                  5,380,405   4,130,622 
 
Cash and cash equivalents at the end of year                    6,166,940   5,380,405 
 
Cash and cash equivalents at the end of year comprise: 
 
Cash at bank and in hand                                        6,166,940   5,380,405 
 
                                                                6,166,940   5,380,405 
 
 
1.         Accounting policies 
 
     1.1 Basis of preparation of financial statements 
 
The financial statements have been prepared under the historical cost 
convention unless otherwise specified within these accounting policies and in 
accordance with Financial Reporting Standard 102, the Financial Reporting 
Standard applicable in the UK and the Republic of Ireland and the Companies Act 
2006. 
 
The preparation of financial statements in compliance with FRS 102 requires the 
use of certain critical accounting estimates. It also requires management to 
exercise judgment in applying the Company's accounting policies. 
 
The following principal accounting policies have been applied: 
 
     1.2 Revenue 
 
Turnover is recognised for product supplied or services rendered to the extent 
that it is probable that the economic benefits will flow to the Company and the 
turnover can be reliably measured. Turnover is measured as the fair value of 
the consideration received or receivable, excluding discounts, rebates, value 
added tax and other sales taxes. The following criteria determine when turnover 
will be recognised: 
 
Direct sales 
 
 
Direct sales are recognised at the date of dispatch. 
 
 
R&D income 
 
 
Subcontracted R&D income is recognised based upon the stage of completion at 
the year-end. 
 
Licence revenue 
 
 
Annual licence revenue is recognised, in full, based upon the date of the 
invoice, and royalties are accrued over the period to which they relate. 
 
     1.3 Intangible assets 
 
Intangible assets are initially recognised at cost. After recognition, under 
the cost model, intangible assets are measured at cost less any accumulated 
amortisation and any accumulated impairment losses. 
 
All intangible assets are considered to have a finite useful life. If a 
reliable estimate of the useful life cannot be made, the useful life shall not 
exceed ten years. 
 
 The estimated useful lives range as follows: 
 
                Goodwill                  -     10                 years 
 
                Know how                  -     10                 years 
 
     1.4  Tangible fixed assets 
 
 
Tangible fixed assets under the cost model are stated at historical cost less 
accumulated depreciation and any accumulated impairment losses. Historical cost 
includes expenditure that is directly attributable to bringing the asset to the 
location and condition necessary for it to be capable of operating in the 
manner intended by management. 
 
Depreciation is charged so as to allocate the cost of assets less their 
residual value over their estimated useful lives on the following basis: 
 
               Freehold property        - 2%       straight line 
 
               Plant and equipment      - 25%      reducing balance 
 
               Motor Vehicles           - 25%      straight line 
 
               Equipment                - 25%      straight line 
 
 
 
     1.5 Valuation of investments 
 
Investments in unlisted Company shares, whose market value can be reliably 
determined, are remeasured to market value at each balance sheet date. Gains 
and losses on remeasurement are recognised in the Statement of comprehensive 
income for the period. Where market value cannot be reliably determined, such 
investments are stated at historic cost less impairment. 
 
     1.6 Stocks 
 
Stocks are stated at the lower of cost and net realisable value, being the 
estimated selling price less costs to complete and sell. Cost includes all 
direct costs and an appropriate proportion of fixed and variable overheads. 
 
At each balance sheet date, stocks are assessed for impairment. If stock is 
impaired, the carrying amount is reduced to its selling price less costs to 
complete and sell. The impairment loss is recognised immediately in profit or 
loss. 
 
     1.7 Debtors 
 
Short term debtors are measured at transaction price, less any impairment. 
Loans receivable are measured initially at fair value, net of transaction 
costs, and are measured subsequently at amortised cost using the effective 
interest method, less any impairment. 
 
     1.8 Cash and cash equivalents 
 
Cash is represented by cash in hand and deposits with financial institutions 
repayable without penalty on notice of not more than 24 hours. Cash equivalents 
are highly liquid investments that mature in no more than three months from the 
date of acquisition and that are readily convertible to known amounts of cash 
with insignificant risk of change in value. 
 
In the Statement of cash flows, cash and cash equivalents are shown net of bank 
overdrafts that are repayable on demand and form an integral part of the 
Company's cash management. 
 
     1.9 Financial instruments 
 
The Company only enters into basic financial instruments transactions that 
result in the recognition of financial assets and liabilities like trade and 
other debtors and creditors, loans from banks and other third parties, loans to 
related parties and investments in non-puttable ordinary shares. 
 
     1.10 Creditors 
 
Short term creditors are measured at the transaction price. Other financial 
liabilities, including bank loans, are measured initially at fair value, net of 
transaction costs, and are measured subsequently at amortised cost using the 
effective interest method. 
 
     1.11 Foreign currency translation 
 
Functional and presentation currency 
 
The Company's functional and presentational currency is GBP. 
 
Transactions and balances 
 
Foreign currency transactions are translated into the functional currency using 
the spot exchange rates at the dates of the transactions. 
 
At each period end foreign currency monetary items are translated using the 
closing rate. Non-monetary items measured at historical cost are translated 
using the exchange rate at the date of the transaction and non-monetary items 
measured at fair value are measured using the exchange rate when fair value was 
determined. 
 
     1.12 Finance costs 
 
Finance costs are charged to the Statement of comprehensive income over the 
term of the debt using the effective interest method so that the amount charged 
is at a constant rate on the carrying amount. Issue costs are initially 
recognised as a reduction in the proceeds of the associated capital instrument. 
 
     1.13 Dividends 
 
Equity dividends are recognised when they become legally payable. Interim 
equity dividends are recognised when paid. Final equity dividends are 
recognised when approved by the shareholders at an annual general meeting. 
Dividends on shares recognised as liabilities are recognised as expenses and 
classified within interest payable. 
 
     1.14 Employee benefits-share-based compensation 
 
The company operates an equity-settled, share-based compensation plan. The fair 
value of the employee services received in exchange for the grant of the 
options is recognised as an expense over the vesting period. The total amount 
to be expensed over the vesting period is determined by reference to the fair 
value of the options granted. At each balance sheet date, the company will 
revise its estimates of the number of options are expected to be exercisable. 
It will recognise the impact of the revision of original estimates, if any, in 
the profit and loss account, with a corresponding adjustment to equity. The 
proceeds received net of any directly attributable transaction costs are 
credited to share capital (nominal value) and share premium when the options 
are exercised. 
 
     1.15 Pensions 
 
Defined contribution pension plan 
 
The Company operates a defined contribution plan for its employees. A defined 
contribution plan is a pension plan under which the Company pays fixed 
contributions into a separate entity. Once the contributions have been paid the 
Company has no further payment obligations. 
 
The contributions are recognised as an expense in the Statement of 
comprehensive income when they fall due. Amounts not paid are shown in accruals 
as a liability in the Statement of financial position. The assets of the plan 
are held separately from the Company in independently administered funds. 
 
     1.16 Interest income 
 
Interest income is recognised in the Statement of comprehensive income using 
the effective interest method. 
 
     1.17 Provisions for liabilities 
 
Provisions are made where an event has taken place that gives the Company a 
legal or constructive obligation that probably requires settlement by a 
transfer of economic benefit, and a reliable estimate can be made of the amount 
of the obligation. 
 
 
Provisions are charged as an expense to the Statement of comprehensive income 
in the year that the Company becomes aware of the obligation, and are measured 
at the best estimate at the Statement of financial position date of the 
expenditure required to settle the obligation, taking into account relevant 
risks and uncertainties. 
 
 
When payments are eventually made, they are charged to the provision carried in 
the Statement of financial position. 
 
     1.18 Current and deferred taxation 
 
The tax expense for the year comprises current and deferred tax. Tax is 

recognised in the Statement of comprehensive income, except that a charge 
attributable to an item of income and expense recognised as other comprehensive 
income or to an item recognised directly in equity is also recognised in other 
comprehensive income or directly in equity respectively. 
 
The current income tax charge is calculated on the basis of tax rates and laws 
that have been enacted or substantively enacted by the reporting date in the 
countries where the Company operates and generates income. 
 
Deferred tax balances are recognised in respect of all timing differences that 
have originated but not reversed by the Statement of financial position date, 
except that: 
 
· The recognition of deferred tax assets is limited to the extent that it is 
probable that they will be recovered against the reversal of deferred tax 
liabilities or other future taxable profits; and 
 
· Any deferred tax balances are reversed if and when all conditions for 
retaining associated tax allowances have been met. 
 
Deferred tax balances are not recognised in respect of permanent differences 
except in respect of business combinations, when deferred tax is recognised on 
the differences between the fair values of assets acquired and the future tax 
deductions available for them and the differences between the fair values of 
liabilities acquired and the amount that will be assessed for tax. Deferred tax 
is determined using tax rates and laws that have been enacted or substantively 
enacted by the reporting date. 
 
     1.19 Research and development 
 
Research and development expenditure is written off in the year in which it is 
incurred. 
 
     2.             Judgments in applying accounting policies and key sources of 
     estimation uncertainty 
 
In the application of the company's accounting policies (as described in note 
1), management is required to make judgments, estimates and assumptions. These 
estimates and underlying assumptions are reviewed on an ongoing basis. 
 
There are no sources of estimation uncertainty that have a significant effect 
on the amounts recognised in the financial statements. 
 
     3.             Turnover 
 
     An analysis of turnover by class of business is as follows: 
 
                                                                      2017       2016 
 
                                                                         GBP          GBP 
 
     Product revenue and R&D income                              1,925,059  1,389,061 
 
     Royalty and licence fee income                              5,320,803  4,128,156 
 
                                                                 7,245,862  5,517,217 
 
 
 
 
                                                                     2017       2016 
 
                                                                        GBP          GBP 
 
     United Kingdom                                               305,609    313,712 
 
     Other EU                                                   2,378,988  1,754,400 
 
     Rest of the world                                          4,561,265  3,449,104 
 
                                                                7,245,862  5,517,216 
 
 
 
 
     4.             Operating profit 
 
     The operating profit is stated after charging: 
 
                                                                      2017       2016 
 
                                                                         GBP          GBP 
 
     Depreciation of tangible fixed assets                          39,479     41,729 
 
     Fees payable to the Company's auditor and its associates        9,654      9,240 
     for the audit of the Company's annual financial statements 
 
     Exchange differences                                          (5,747)   (75,512) 
 
     Research and development costs                                764,480    713,715 
 
 
 
     5.             Taxation 
 
                                                                      2017       2016 
 
                                                                         GBP          GBP 
 
     Corporation tax 
 
     Current tax on profits for the year                           851,386    726,862 
 
                                                                   851,386    726,862 
 
     Total current tax                                             851,386    726,862 
 
     Deferred tax 
 
     Origination and reversal of timing differences                (1,835)    (2,369) 
 
     Total deferred tax                                            (1,835)    (2,369) 
 
     Taxation on profit on ordinary activities                     849,551    724,493 
 
     Factors affecting tax charge for the year 
 
     The tax assessed for the year is higher than (2016 - lower than) the standard 
     rate of corporation tax in the UK of 19% (2016 - 20%). The differences are 
     explained below: 
 
                                                                      2017       2016 
 
                                                                         GBP          GBP 
 
     Profit on ordinary activities before tax                    5,771,840  4,218,921 
 
     Profit on ordinary activities multiplied by standard rate   1,096,650    843,784 
     of corporation tax in the UK of 19% (2016 - 20%) 
 
     Effects of: 
 
     Expenses not deductible for tax purposes, other than           12,946     10,898 
     goodwill amortisation and impairment 
 
     Capital allowances for year in excess of depreciation           3,146      3,855 
 
     Short term timing difference leading to an increase           (1,835)    (2,368) 
     (decrease) in taxation 
 
     Adjustment in research and development tax credit leading   (131,939)  (131,676) 
     to an increase (decrease) in the tax charge 
 
     Tax deduction arising from exercise of employee options     (161,775)          - 
 
     Other differences leading to an increase (decrease) in the     32,358          - 
     tax charge 
 
     Total tax charge for the year                                 849,551    724,493 
 
 
 
     Factors that may affect future tax charges 
 
There were no factors that may affect future tax charges. 
 
      6.             Dividends 
 
                                                                            2017        2016 
 
                                                                               GBP           GBP 
 
      Dividends paid                                                   3,373,116   1,924,405 
 
                                                                       3,373,116   1,924,405 
 
      7.             Share capital 
 
                                                                            2017        2016 
 
                                                                               GBP           GBP 
 
      Shares classified as equity 
 
      Allotted, called up and fully paid 
 
      5,138,674 (2016 - 5,050,931) Ordinary shares of GBP0.05 each      256,934     252,547 
 
 
 
 
     The holders of ordinary shares are entitled to receive dividends as declared 
     and are entitled to one vote per share at meetings of the Company. All ordinary 
     shares rank equally with regard to the Company's residual assets. 
 
     8.             Share based payments 
 
     During the year the company operated an Approved Share Option Scheme (the 
     "Option Scheme"), to incentivise employees. 
 
     The company has applied the requirements of FRS 102 Section 26 Share-based 
     Payment to all the options granted. The Option Scheme provides for a grant 
     price equal to the market value of the Company's shares on the date of the 
     grant, as agreed with HMRC Shares and Assets Valuation Division. 
 
     The contractual life of an option is 10 years from the date of grant. Options 
     granted become exercisable on the third anniversary of the date of grant. 
     Exercise of an option is normally subject to continued employment, but there 
     are also considerations for good leavers. All share based remuneration is 
     settled in equity shares. 
 
 
                                             Weighted Number2017   Weighted   Number2016 
                                              average               average 
                                             exercise              exercise 
                                                price                 price 
                                          (pence)2017               (pence) 
                                                                       2016 
 
     Outstanding at the beginning of the        GBP3.99     91,743      GBP3.66       87,743 
     year 
 
     Granted during the year                   GBP13.50     85,938     GBP11.15        4,000 
 
     Exercised during the year                  GBP3.66   (87,743)                       - 
 
     Outstanding at the end of the year        GBP13.40     89,938      GBP3.99       91,743 
 
 
 
 
                                                                     2017          2016 
 
     Option pricing model used                                      Black Black Scholes 
                                                                  Scholes 
 
     Issue price                                                  GBP3.12-GBP  GBP3.12-GBP11.60 
                                                                    13.50 
 
     Exercise price (pence)                                       GBP3.12-GBP  GBP3.12-GBP11.60 
                                                                    13.50 
 
     Option life                                                 10 years      10 years 
 
     Expected volatility                                           25.15% 17.47%-33.82% 
 
     Fair value at measurement date                               GBP1.72-GBP   GBP1.50-GBP3.08 
                                                                     4.66 
 
     Risk-free interest rate                                        1.02%         0.84% 
 
 
 

      Expected volatility was based on past volatility since the shares have been 
      listed on AIM. 
 
      The expense recognised for share-based payments during the year ended 30 June 
      2017 was GBP67,005 (Year ended 30 June 2016 : GBP53,225). 
 
      The number of staff and officers holding share options at 30 June 2017 was 15. 
      The share options have been issued to underpin staff service conditions. 
 
     9.             Earnings per share 
 
 
The weighted average number of shares in issue for the basic earnings per share 
calculation is 5,108,026 (2016: 5,050,931) and for the diluted earnings per 
share, assuming the exercise of all share options is 5,197,961 (2016: 
5,142,673). 
 
The calculation of the basic earnings per shares is based on the profit for the 
period of GBP4,922,289 (2016: GBP3,494,428) divided by the weighted average number 
of shares in issue of 5,108,026 (2016: 5,505,931), the basic earnings per share 
is 96.36p (2016: 69.18p). The diluted earnings per share, assuming the exercise 
of all of the share options is based on 5,197,961 (2016: 5,142,673) shares and 
is 94.70p (2016: 67.95p). 
 
     10.          Publication of Non-Statutory Accounts 
 
The financial information set out in this preliminary announcement does not 
constitute the Group's financial statements for the year ended 30 June 2017. 
The financial statements for the year ended 30 June 2016 have been delivered to 
the Registrar of Companies. The financial statements for the year ended 30 June 
2017 will be delivered to the Registrar of Companies following the Company's 
Annual General Meeting. The auditors' report on both accounts was unqualified, 
did not include references to any matters to which the auditors drew attention 
by way of emphasis without qualifying their report and did not contain 
statements under sections 498(2) or (3) of the Companies Act 2006.  The audited 
financial statements of Bioventix plc for the period ended 30 June 2017 are 
expected to be posted to shareholders shortly, will be available to the public 
at the Company's registered office, 7 Romans Business Park, East Street, 
Farnham, Surrey, GU9 7SX and available to view on the Company's website at 
www.bioventix.com once posted. 
 
 
 
END 
 

(END) Dow Jones Newswires

October 16, 2017 02:00 ET (06:00 GMT)