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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Collagen Solutions Plc | LSE:COS | London | Ordinary Share | GB00B94T6Y14 | ORD 1P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 6.625 | 6.25 | 7.00 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From Apr 2019 to Apr 2024
TIDMCOS
RNS Number : 3357Y
Collagen Solutions PLC
05 December 2017
Collagen Solutions Plc
(the "Company" or the "Group")
Half Yearly Report
Interim Results for the six months ended 30 September 2017
Collagen Solutions plc (AIM: COS), a global supplier, developer and manufacturer of medical grade collagen and tissue components for use in regenerative medicine applications including orthopaedics, dental, wounds, and cardiovascular, announces results for the six months ended 30 September 2017.
Operational Highlights
-- Completed patient assessments with eight-year follow up data for our ChondroMimetic(R) cartilage scaffold
-- Increased close rate of commercial pipeline, with eight new customers / agreements in period (vs two in H1 2016, and nine in the entirety of FY 2017)
-- Completed relocation and consolidation of U.S. Headquarters with R&D and Commercial teams co-located in Minneapolis
-- Received import clearances for our biomaterials and achieved the first customer supply agreement under our Chinese JV
-- Research activities under both Horizon 2020 projects progressing well, with grant funding totalling approximately EUR1 million over a multi-year period
Financial Highlights
-- Group revenue and other income remained flat at GBP1.86 million (H1 2016: GBP1.89 million) -- LBITDA of GBP0.96 million (H1 2016: GBP0.71 million) -- Pre-tax loss of GBP1.38 million (H1 2016: GBP0.98 million)
-- Cash and cash equivalents of GBP6.74 million at 30 September 2017 (31 March 2017: GBP8.98 million)
Jamal Rushdy, Chief Executive Officer of Collagen Solutions, commented: "We have made good progress in the first half of the financial year both in advancing and improving our sales pipeline and increasing our customer base. We also achieved important operational milestones by opening our new U.S. headquarters in Minneapolis and tripling our pericardium tissue supply base. Also, we are pleased that we completed patient assessments for the ChondroMimetic(R) study, targeting release of data in Q1 2018 and CE mark submission shortly thereafter, whilst continuing with partnering discussions. The Board remains confident of the Company increasing shareholder value over the long term whilst mindful of revenue timing with some customers over the next period. We are highly focused in managing through these challenges and are confident of executing on our sales pipeline, hitting key milestones in 2018 and the long term prospects for the Company."
About Collagen Solutions:
Collagen Solutions Plc is a global provider of medical grade collagen formulations and components for use in regenerative medicine, medical devices and in-vitro diagnostics and research. The capabilities of the Company include the provision of native, soluble and powdered collagen formulations, processed and semi-processed tissues such as pericardium, bone, and blood vessels, and expertise in the development and contract manufacture of collagen components for use as engineered tissue scaffolds and other medical devices. These products are used in a wide variety of applications including orthopaedics, cardiovascular, dental, plastic surgery, wound healing, neurology and urology. Collagen Solutions' unique offering extends beyond material supply and contract services through the highly skilled staff who support customers through the various stages of development and regulatory approval. For additional information, please visit www.collagensolutions.com.
Hot Features
Premium
Collagen Solutions Plc
David Evans, Chairman
Jamal Rushdy, CEO / Gill Via Walbrook
Black, CFO
Mob: 07721 413 496
Lisa Baderoon, Investor
Relations
lisa.baderoon@collagensolutions.com
Cenkos Securities Plc
(Nominated Adviser and
Broker)
Steve Cox (Corporate Finance) Tel: 0207 397 8900
Stephen Keys
Walbrook PR Ltd Tel: 020 7933 8780 or collagen@walbrookpr.com
Mike Wort Mob: 07900 608 002
Anna Dunphy Mob: 07876 741 001
CHAIRMAN'S STATEMENT
I am pleased to present Collagen Solutions' interim results for the six-month period ended 30 September 2017. During the period, we made further progress with our core growth strategy. We continued to diversify our customer bases, have taken steps to ensure we increase our high-quality supply base to meet anticipated demand, and also continued developing the strong R&D pipeline of finished devices that will create additional value in the coming years. This continues the momentum for the Group in striving to be the industry's first choice for regenerative biomaterials.
Overview
During this six-month period, revenue (including other income) has remained fairly level when compared to the comparable period. The eight new customers on-boarded during the period will contribute to revenue over the latter part of this year and thereafter. Repeat orders from certain customers paused while they await regulatory clearance and funding. Work completed in securing additional tissue supply will be recognised once our customer related project delays are resolved. We expect timing clarity by the end of Q1 2018.
The overall goal to create significant shareholder value by setting a target to grow our revenue by 5x within five years remains on track and we have implemented detailed plans to deliver on the different elements involved to achieve this growth target. These include:
- Revenue acceleration of the core business, including development services and sourcing of new biomaterials, through the commercial team
- Geographic expansion and increasing the number of channel partners in selected segments, including distributors for the research markets - particularly in Asia and Europe
- Commercialisation through partnering of our proprietary "finished devices" including ChondroMimetic(R), followed by next stage products for wound and bone healing
As part of our research and development strategy the Group is participating in two Horizon 2020 grant-funded research programmes, related to cell-based tissue regeneration techniques and a collagen-based drug delivery system for the treatment of Parkinson's disease. Both projects underway will run over the next two to four years and Collagen Solutions will receive, over the full term, approximately EUR1 million of European Union funding.
Results
The Group's results for the six months ended 30 September 2017 are set out in the Consolidated Statement of Comprehensive Income. Revenue (including other income) for the first six months was GBP1,858,664 (H1 2016: GBP1,891,001), with new customer revenue in the period being less than non-recurring revenues from certain customers awaiting regulatory approval or funding for their products. Administrative expenses, including research and development costs, (excluding separately identifiable items) were GBP1,944,461 (H1 2016: GBP1,341,652) reflecting the increase in headcount over the comparable period in the areas of R&D, quality control/assurance, operations and finance and administration, and also increased R&D spend on the finished device pipeline. Selling and marketing costs were GBP482,926 (H1 2016: GBP417,143) due to the strengthening of the global commercial team and the execution of various marketing initiatives. LBITDA for the first six months was GBP962,935 (H1 2016: GBP712,537), and the basic and diluted loss per share 0.42p (H1 2016: 0.60p).
Net cash used in operations during the period was GBP1,778,063. The Group's cash balance at 30 September 2017 was GBP6,739,105 (31 March 2017: GBP8,978,150). Cash consumption during the period includes a planned GBP1,049,902 payment of deferred consideration, which related mainly to the 2014 acquisition of NZ based Southern Lights Biomaterials. A GBP1 million tranche of the Norgine Bond was also drawn down in the period.
Board and management
We have benefited during the full period from the appointments of Chris Wattengel, VP Global R&D and Brad Selman, VP Global Sales & Marketing, having joined us just prior to the start of the financial year. Chris has been well placed to lead our growing portfolio of product development projects, having previously achieved multiple 510k and CE Mark clearances.
Due to family circumstances, Gill Black has decided to step down as CFO once a replacement is appointed. The recruitment process for a new CFO is well underway. Gill will continue as Company Secretary and a member of the finance team going forward to provide a smooth transition and continuity to the new appointee who will also be based in Glasgow with the UK finance team. We thank Gill for her invaluable contributions as a Board member and CFO over the past three and a half years.
Summary
Our sales pipeline is the strongest it has been in terms of both average value of opportunities and quality of customers. It also has a wider geographic spread with a deeper penetration into the European customer sales channel. While we continue to face a specific risk with a Korean customer on potential reduced quantities at contract renewal next fiscal year, the team is making progress of mitigating this risk by proposing new product categories and services with the customer, and leveraging our market reach to help accelerate their sales. Our progress in the Chinese market continues to show early promise with the first supply agreement of the JV now closed for supply of our collagen products. The completion of the ChondroMimetic(R) extension study in September is expected to provide headline results in Q1 2018 and we expect to be in a position to provide this data to prospective commercialisation partners moving into 2018.
We will soon benefit from the closer collaboration of R&D and commercial teams now under common leadership in Minneapolis and this has started to show early signs of increased opportunities. In particular, I am pleased to report that due to a tremendous amount of focus and effort on the part of our NZ and commercial teams we have now trebled our validated tissue supply capacity to fulfil the increased demand for pericardium.
The Directors believe that whilst the pipeline is encouraging, it will be challenging to meet current market expectations with regards to revenue growth for the full year which is outlined in the Chief Executive Report. The management team will continue to be focused in closing outstanding deals throughout the remainder of this financial year and mitigating impact from our customers' delayed orders over the coming months.
Together with the Board, we are committed to the positive future for Collagen Solutions and its vision to be the industry's first choice for regenerative biomaterials and thank our shareholders, staff and partners for their continued support.
David E Evans
Chairman
4 December 2017
CHIEF EXECUTIVE OFFICERS'S STATEMENT
The first six months of the year has delivered on a number of key milestones. Eight new customer deals (versus nine in total for the 12 months prior) and the final patient being assessed in our eight-year extension clinical study of ChondroMimetic(R) being two significant achievements, whilst the quality and scale of our sales pipeline are both at their highest levels to date. These are all key contributors towards realising value from our multiple growth initiatives.
Revenue performance
Revenue and other income for the first six months was GBP1.86 million, including GBP1.73 million in sales and GBP0.13 million in other income. Whilst this was broadly in line with the comparable period the mix of sales had a different composition. Strong growth was achieved from EMEA, 72% up on the prior period, mainly arising from an increase in development services which will lead to commercial supply volumes in the future.
Revenue from North America fell by GBP0.2 million to GBP0.78 million, a decrease of 20%, partly as a result of a customer project on hold whilst raising funding for the next phase of their clinical trial and other uneven ordering patterns. We must however acknowledge some challenges within this region, and we have made changes in our organisation and approach, specifically in how our sales team engage and manage new business accounts, that we believe will prove successful over the next period with several major opportunities under proposal.
Revenue from Asia was 6% down on the first half of last year to GBP0.62 million caused by some uneven customer order patterns and some delays in new customer revenue, and we remain positive with respect to the pipeline of new customer business in this region.
Operational achievements
Within Collagen Solutions there are two key parts to our business model, 'Core Biomaterials' and 'Proprietary Products'.
Core biomaterials
This is the supply, development, manufacturing of collagen tissue and devices for medical applications, with our clients providing a recurring revenue throughout their lifetime with these applications. We are focused on growth from customer product launches and expansion with incremental sales deriving from new customers and new geographies.
We are delighted that during the first six months of the year the team delivered eight new early-stage customer wins. This is a tremendous achievement compared with nine deals signed in the entirety of last year. The new business gained is across the full spectrum of our business offering, ranging from another distributor in Asia, development projects in NZ and the UK for European customers, new tissue sourcing and core supply of soluble and lyophilised collagen to Asia, US and EMEA.
Collagen Solutions also continues to see demand for its pericardium tissue business grow, and through specific initiatives to diversify and increase our tissue supply base in Australia and New Zealand, these activities have allowed us to secure the additional anticipated demand with existing and new customers and tripled our capacity.
Proprietary products
Within our proprietary products division a key milestone was also met in September when we completed patient assessments in our eight-year extension clinical study of ChondroMimetic(R) osteochondral scaffold. The resulting data is due to be reported in Q1 2018, followed by a CE mark submission, whilst now engaging in partnering discussions in Asia and Europe.
The Company has made a presentation available regarding this study update on its website at: http://ir.collagensolutions.com/content/investors/presentations.asp
Innovation, product development and IP
The Company continues to be committed to invest in research and development and has made continued progress in biomaterials innovation, both for our core Supply, Development, and Manufacturing business and also our Proprietary Products programmes.
A foundation of our value proposition to customers is our scientific expertise in formulations of collagen and tissue application for regenerative medicine. We continue to build upon this expertise through various research programmes including our two Horizon 2020 grants; the Development of Biomaterial-based Delivery Systems for Parkinson's disease (BrainMatTrain) and Multisystem Cell Therapy for Improvement of Urinary Continence (MUSIC). Together these grants total approximately EUR1 million in funding through 2021.
Patent protection supports this strategy with Australia-New Zealand tissue sourcing becoming a more significant part of our core business and we believe we have a strong patent position within our current portfolio which includes: pericardium material, which can be used for heart valve replacement medical devices and other applications and the filing of a provisional US patent application covering novel properties of a bone graft substitute formulation.
Our wound healing project based upon core technology developed over several years has been presented at multiple conferences. This technology has the potential to address the limitations of current split or full-thickness autologous skin grafts, particularly in large wound sites. Our pre-clinical trials are scheduled to begin in 2018 with wound market clearance expected to follow in late 2018 / early 2019.
Relocation complete
We completed consolidation of our new U.S. Headquarters with R&D and Commercial teams co-located in Minneapolis, resulting from our relocation of our U.S. R&D facilities from San Jose to Minneapolis. We are confident of realising some operational cost savings by merging the two sites but more importantly enhancing our global R&D and commercial coordination and collaboration with the leadership of both teams at the same Minneapolis site.
Investor relations
We are committed to increasing our profile within the investor community and creating greater transparency in how we communicate to existing and new investors on a global basis. We have attended a number of key investor symposiums over the period which have been received well and we will continue to do this over the next period. Recent presentations can be accessed from our website http://ir.collagensolutions.com/content/investors/presentations.asp.
We have also recently appointed Lisa Baderoon as our internal Investor Relations consultant. Lisa Baderoon has over 25 years' experience within the healthcare arena engaging with companies and investors and creating effective and proactive investor relations strategies for clients. We are confident that, with Lisa working with Collagen Solution's Board and advisors, this will be a key component to achieving long term shareholder value as we focus on achieving key milestones in our future development.
Current trading and outlook
The quality and scale of our sales pipeline are both at their highest levels to date, with several opportunities in the mid-high six figure range. With a strong operational team now in place we continue to build a solid global sales pipeline, engaging in partnering discussions and securing new customer agreements for the long term.
We have already highlighted in our trading update in October of being second half weighted with regards to revenue growth and we are confident that the full year will demonstrate this progress. Guidance should however be given at this stage in our trading year that we will likely be behind current market expectations.
There are a few key customer issues that are creating this shortfall, even while the Company extends its customer base and grows its pipeline. Predominantly these are based on external circumstances aligned to our customers own internal forecasts, development cycles and approvals that have been delayed. In particular, one of our core tissue customers has very recently reduced year-end orders due to their own internal delays of launch plans, when we had expected an increase in volumes on launch this year and for whom we significantly increased abattoir capacity. We understand this is an inherent challenge within our highly regulated medical devices marketplace and we are endeavoring to assess and put in strategic initiatives to ensure we mitigate as much as possible from these issues going forward.
A further factor is based on deals aligned to this financial year moving into the next year as final negotiations take longer than initially planned, to complete. Whilst frustrating, particularly with regards to the quality of the live deals we currently have under negotiation, we are confident in securing many of these agreements.
There are however a number of further key developments and new business opportunities over the next period which could have a significant positive impact on the business longer term. ChondroMimetic(R)'s resulting data which is on track to be reported in Q1 2018, is one key milestone and our focus is in securing a partner or partners within 2018.
In summary, we remain positive on the operational improvements we have made to date, the strength and quality of our sales pipeline, and the progress and prospects for our proprietary devices projects including ChondroMimetic(R). We look forward to providing the market with updates on progress through 2018.
Jamal Rushdy
Chief Executive Officer
4 December 2017
Collagen Solutions Plc
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the six months ended 30 September 2017
Unaudited Unaudited Audited
six months six months year ended
ended 30 ended 30 31
September September March 2017
2017 2016
Notes GBP GBP GBP
REVENUE 1,725,605 1,830,662 3,945,787
Cost of sales (628,744) (525,512) (983,632)
------------ ------------ ---------------
Gross profit 1,096,861 1,305,150 2,962,155
Share-based compensation (30,000) (25,002) (50,585)
Administrative
expenses
(excluding separately
identifiable items) (1,944,461) (1,341,652) (3,596,707)
Separately identifiable
items 4 264,532 (294,229) 227,155
------------ ------------ ---------------
Total Administrative
expenses (1,679,929) (1,635,881) (3,369,552)
Selling and marketing
costs (482,926) (417,143) (718,986)
Other income 133,059 60,339 144,762
------------ ------------ ---------------
LOSS BEFORE INTEREST
TAX
DEPRECIATION AND
AMORTISATION (962,935) (712,537) (1,032,206)
Amortisation and
depreciation (233,905) (206,224) (449,427)
Finance income 2,412 2,106 2,841
Finance expense (185,280) (66,658) (134,958)
------------ ------------ ---------------
LOSS BEFORE TAXATION (1,379,708) (983,313) (1,613,750)
Taxation 12,972 (53,326) (141,928)
------------ ------------ ---------------
LOSS FOR THE PERIOD (1,366,736) (1,036,639) (1,755,678)
Attributable to:
Owners of the parent (1,349,920) (1,026,955) (1,707,265)
Non-controlling
interest (16,816) (9,684) (48,413)
------------ ------------ ---------------
(1,366,736) (1,036,639) (1,755,678)
------------ ------------ ---------------
Currency translation
difference (520,647) 1,387,568 1,392,495
------------ ------------ ---------------
Other comprehensive
(loss)/income (520,647) 1,387,568 1,392,495
------------ ------------ ---------------
TOTAL COMPREHENSIVE
(LOSS)/GAIN FOR THE
PERIOD (1,887,383) 350,929 (363,183)
==================== ============ ===============
Attributable to:
Owners of the parent (1,867,610) 351,597 (327,007)
Non-controlling
interest (19,773) (668) (36,176)
------------ ------------ ---------------
(1,887,383) 350,929 (363,183)
------------ ------------ ---------------
Basic and diluted
loss per share
- pence attributed
to owners of the
parent 3 (0.42p) (0.60p) (0.95p)
========================== ======= ============ ============ ===============
Collagen Solutions Plc
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30 September 2017
Unaudited Unaudited Audited
30 September 30 September 31 March
2017 2016 2017
ASSETS Notes GBP GBP GBP
Non-current assets
Intangible assets 14,160,038 14,326,420 14,581,893
Property, plant and equipment 1,231,726 1,250,552 1,142,741
------------- ------------- ------------
15,391,764 15,576,972 15,724,634
------------- ------------- ------------
Current assets
Inventories 318,552 410,081 313,395
Trade and other receivables 946,187 851,529 806,566
Cash and cash equivalents 6,739,105 1,657,193 8,978,150
------------- ------------- ------------
8,003,844 2,918,803 10,098,111
------------- ------------
Total assets 23,395,608 18,495,775 25,822,745
============= ============= ============
EQUITY AND LIABILITIES
Equity attributable to equity
holders of the parent company
Share capital 5 3,290,166 1,841,213 3,287,991
Share premium 14,869,909 8,835,508 14,851,092
Share-based payment reserve 167,809 112,226 137,809
Shares to be issued reserve 106,581 1,025,353 131,934
Merger reserve 4,531,798 4,531,798 4,531,798
Translation reserve 1,021,986 1,537,970 1,539,676
Retained deficit (5,641,239) (3,611,009) (4,291,319)
------------- ------------- ------------
Equity attributable to non-equity
holders of the parent company 18,347,010 14,273,059 20,188,981
------------- ------------- ------------
Non-controlling interest
reserve 77,384 132,665 97,157
Total equity 18,424,394 14,405,724 20,286,138
Non-current liabilities
Deferred tax 207,174 235,992 221,847
Other financial liabilities - 2,538,779 1,289,357
Borrowings 6 2,468,327 60,138 1,879,899
------------- ------------- ------------
2,675,501 2,834,909 3,391,103
-------------
Current liabilities
Trade and other payables 899,933 888,721 1,000,086
Income tax liabilities - 15,293 58,530
Other financial liabilities 949,152 325,703 1,060,484
Borrowings 6 446,628 25,425 26,404
------------- ------------- ------------
2,295,713 1,255,142 2,145,504
------------- ------------- ------------
Total liabilities 4,971,214 4,090,051 5,536,607
------------- ------------- ------------
Total liabilities and equity 23,395,608 18,495,775 25,822,745
============= ============= ============
Collagen Solutions Plc
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the six months ended 30 September 2017
Share Share Share-Based Shares Merger Translation Retained Total Non-Controlling Total
Capital Premium Payment to Reserve Reserve Deficit Interest Equity
Account Reserve be
issued
Reserve
------------ ------------ ------------ -------------- ------------ ------------ -------------- ------------- ---------------- -------------
GBP GBP GBP GBP GBP GBP GBP GBP GBP GBP
As at 1
April 2016 1,759,038 7,892,330 87,224 2,050,706 4,531,798 159,418 (2,584,054) 13,896,460 - 13,896,460
------------ ------------ ------------ -------------- ------------ ------------ -------------- ------------- ---------------- -------------
Issue of
shares
on acquisition
of assets 2,175 23,178 - (25,353) - - - - - -
Issue of
shares
to Collagen
Solutions
(UK) vendors 80,000 920,000 - (1,000,000) - - - - - -
------------ ------------ ------------ -------------- ------------ ------------ -------------- ------------- ---------------- -------------
Total
transactions
with owners
in their
capacity
as owners 82,175 943,178 - (1,025,353) - - - - - -
Share Based
Compensation - - 25,002 - - - - 25,002 - 25,002
Non-controlling
interest
share of
net assets - - - - - - - - 133,333 133,333
Loss for
period - - - - - - (1,026,955) (1,026,955) (9,684) (1,036,639)
Currency
translation
difference - - - - - 1,378,552 - 1,378,552 9,016 1,387,568
----------------- ------------ ------------ ------------ -------------- ------------ ------------ -------------- ------------- ---------------- -------------
Loss and
total
comprehensive
income
for period - - - - - 1,378,552 (1,026,955) 351,597 (668) 350,929
As at 30
September
2016 1,841,213 8,835,508 112,226 1,025,353 4,531,798 1,537,970 (3,611,009) 14,273,059 132,665 14,405,724
------------ ------------ ------------ -------------- ------------ ------------ -------------- ------------- ---------------- -------------
Issue of
shares
for cash 1,366,778 5,467,111 - - - - - 6,833,889 - 6,833,889
Share issue
costs - (371,527) - - - - - (371,527) - (371,527)
Issue of
shares
to Collagen
Solutions
(UK) vendors 80,000 920,000 - (1,000,000) - - - - - -
------------ ------------ ------------ -------------- ------------ ------------ -------------- ------------- ---------------- -------------
Total
transactions
with owners
in their
capacity
as owners 1,446,778 6,015,584 - (1,000,000) - - - 6,462,362 - 6,462,362
Share-based
compensation - - 25,583 - - - - 25,583 - 25,583
Norgine
warrants
to be issued - - - 106,581 - - - 106,581 - 106,581
----------------- ------------ ------------ ------------ -------------- ------------ ------------ -------------- ------------- ---------------- -------------
Loss for
the period - - - - - - (680,310) (680,310) (38,729) (719,039)
Currency
translation
difference - - - - - 1,706 - 1,706 3,221 4,927
----------------- ------------ ------------ ------------ -------------- ------------ ------------ -------------- ------------- ---------------- -------------
Loss and
total
comprehensive
loss for
the period - - - - - 1,706 (680,310) (678,604) (35,508) (714,112)
At 31 March
2017 3,287,991 14,851,092 137,809 131,934 4,531,798 1,539,676 (4.291,319) 20,188,981 97,157 20,286,138
------------ ------------ ------------ -------------- ------------ ------------ -------------- ------------- ---------------- -------------
Issue of
shares
on acquisition
of assets 2,175 23,178 - (25,353) - - - - - -
Share issue
costs - (4,361) - - - - - (4,361) - (4,361)
------------ ------------ ------------ -------------- ------------ ------------ -------------- ------------- ---------------- -------------
Total
transactions
with owners
in their
capacity
as owners 2,175 18,817 - (25,353) - - - (4,361) - (4,361)
Share-based
compensation - - 30,000 - - - - 30,000 - 30,000
----------------- ------------ ------------ ------------ -------------- ------------ ------------ -------------- ------------- ---------------- -------------
Loss for
the period - - - - - - (1,349,920) (1,349,920) (16,816) (1,366,736)
Currency
translation
difference - - - - - (517,690) - (517,690) (2,957) (520,647)
----------------- ------------ ------------ ------------ -------------- ------------ ------------ -------------- ------------- ---------------- -------------
Loss and
total
comprehensive
loss for
the period - - - - - (517,690) (1,349,920) (1,867,610) (19,773) (1,887,383)
------------ ------------ ------------ -------------- ------------ ------------ -------------- ------------- ---------------- -------------
At 30 September
2017 3,290,166 14,869,909 167,809 106,581 4,531,798 1,021,986 (5,641,239) 18,347,010 77,384 18,424,394
------------ ------------ ------------ -------------- ------------ ------------ -------------- ------------- ---------------- -------------
Collagen Solutions Plc
CONSOLIDATED STATEMENT OF CASH FLOWS
For the six months ended 30 September 2017
Unaudited Unaudited Audited
six months six months year
ended 30 ended 30 ended 31
September September March
2017 2016 2017
------------- ----------- -----------
GBP GBP GBP
CASH FLOW FROM OPERATING
ACTIVITIES
Loss before taxation (1,379,708) (983,313) (1,613,750)
Share based compensation 30,000 25,002 50,585
Depreciation 116,880 114,126 234,390
Amortisation 117,025 92,098 215,037
(Decrease)/increase in contingent
consideration (392,477) 294,229 (325,390)
Finance expense 185,280 66,658 134,958
Finance income (2,412) (2,106) (2,841)
Loss on sale of property,
plant and equipment - - 993
Increase in inventories (9,169) (136,061) (54,345)
(Increase) in trade and other
receivables (102,282) (140,561) (212,571)
(Decrease)/increase in trade
and other payables (102,790) 22,056 190,947
------------- ----------- -----------
CASH USED IN OPERATIONS (1,539,653) (647,872) (1,381,987)
Interest paid (119,793) (3,513) (7,082)
Taxation paid (118,617) (45,366) (104,941)
------------- ----------- -----------
Net cash used in operations (1,778,063) (696,751) (1,494,010)
------------- ----------- -----------
INVESTING ACTIVITIES
Proceeds from the sale of
property, plant and equipment - - 414
Payments to acquire property,
plant and equipment (203,629) (98,915) (137,324)
Payments to acquire licensed
IP, patents and intangibles (176,661) (70,803) (341,502)
Interest received 2,412 2,106 2,841
Payment of deferred consideration (1,049,902) (25,353) -
Net cash used in investing
activities (1,427,780) (192,965) (475,571)
------------- ----------- -----------
FINANCING ACTIVITES
Repayment of related party
loan (15,145) (11,050) (10,931)
Net proceeds on issue of
ordinary shares (4,361) - 6,462,362
Net proceeds from bond issue 1,000,000 - 1,940,000
----------- ----------- -----------
NET CASH GENERATED FROM/(USED
IN) FINANCING ACTIVITIES 980,494 (11,050) 8,391,431
----------- ----------- -----------
Net (decrease)/increase in
cash and cash equivalents (2,225,349) (900,766) 6,421,850
Effect of foreign exchange
rates on the balance of cash
held in foreign currencies (13,696) 64,813 63,154
----------- ----------- -----------
Net (decrease)/ increase
in cash and cash equivalents (2,239,045) (835,953) 6,485,004
Cash and cash equivalents
at the beginning of the financial
period 8,978,150 2,493,146 2,493,146
----------- ----------- -----------
Cash and cash equivalents
at the end of the financial
period 6,739,105 1,657,193 8,978,150
=========== =========== ===========
Collagen Solutions Plc
NOTES TO THE INTERIM FINANCIAL STATEMENTS
1. BASIS OF PREPARATION
The unaudited interim statement results for the six-month period ending 30 September 2017 were approved by the Board of Directors on 4 December 2017. The financial information contained in the interim report does not constitute statutory accounts within the meaning of section 434 (3) of the Companies Act 2006. The financial information for the full preceding year is based on the statutory accounts for the year ended 31 March 2017, upon which the auditors issued an unqualified opinion and did not contain any statement under section 498(2) or 498(3) of the Companies Act 2006. The audited statutory accounts for the period ended 31 March 2017 have been lodged with the Registrar of Companies.
While the financial information included in this interim report has been prepared in accordance with the recognition and measurement criteria of International Financial Reporting Standards, as adopted by the European Union (EU) (IFRS), this announcement does not in itself contain sufficient information to comply with IFRS.
The Company is a limited liability company incorporated and domiciled in England & Wales and whose shares are quoted on AIM, a market operated by The London Stock Exchange. The consolidated financial information of Collagen Solutions plc is presented in pounds sterling (GBP), which is also the functional currency of the Group.
2. SEGMENTAL REPORTING
Revenue information by geographical location:
Unaudited Unaudited Audited
six months six months year ended
ended 30 ended 30 31 March
September September 2017
2017 2016
------------ ------------ ------------
GBP GBP GBP
Europe, Middle
East & Africa 321,850 187,348 425,269
North America 780,586 979,984 1,924,540
Asia 623,169 663,330 1,595,978
------------ ------------ ------------
1,725,605 1,830,662 3,945,787
------------ ------------ ------------
3. LOSS PER SHARE
The calculation of basic loss per ordinary share for the six months ended 30 September 2017 is based on losses of GBP1,366,736 and on 324,322,845 ordinary shares being the weighted average number of shares in issue during the period. The calculation of basic loss per ordinary share for the six months ended 30 September 2016 is based on losses of GBP1,036,639 and on 172,391,708 ordinary shares being the weighted average number of shares in issue during the period. The calculation of basic loss per ordinary share for the period ended 31 March 2017 is based on losses of GBP1,755,678 and on 185,778,383 ordinary shares being the weighted average number of shares in issue during the period.
The loss for the period and the weighted average number of ordinary shares for calculating the diluted loss per share for the six months ended 30 September 2017, the six months ended 30 September 2016 and the year ended 31 March 2017 are identical to those for the basic loss per share. This is because the outstanding share options would have the effect of reducing the loss per share and would therefore not be dilutive under the terms of International Accounting Standard ("IAS") No 33.
4. SEPARATELY IDENTIFIABLE ITEMS
Separately identifiable items in the six months ended 30 September 2017 of GBP264,532 relate to the release of deferred contingent consideration provisions on reassessment of the earn-outs payable for the acquisition of Collagen Solutions LLC and Collagen Solutions NZ Limited (formerly Southern Lights Ventures 2002 Limited). This release totaled GBP353,557. This has been offset by GBP89,025 of relocation and reorganisation costs due to the consolidation of the US R&D facility in San Jose to the commercial HQ in Minneapolis during the period.
Separately identifiable items in the six months ended 30 September 2016 of GBP294,229 related to unrealised translation losses on the conversion of deferred contingent consideration payments due in New Zealand dollars for the acquisition of Collagen Solutions NZ Limited in December 2014.
Separately identifiable items in the year ended 31 March 2017 of GBP227,155 related to the release of deferred contingent consideration provisions on reassessment of the earn-out payable for the acquisitions of Collagen Solutions LLC and Collagen Solutions NZ Limited totaling GBP553,063. This has been offset by a GBP253,027 foreign exchange loss on the translation of the earn out payable in New Zealand dollars to Sterling for the acquisition of Collagen Solutions NZ Limited and legal fees of GBP72,881 in relation to setting up the Norgine Bond facility agreement.
5. SHARE CAPITAL
On 11 September 2017, 217,475 ordinary shares were issued as part of the consideration for the ChondroMimetic(R) assets.
The following table details the warrants and share options granted over ordinary shares of the Company at 30 September 2017.
Grant Date Number Warrant/option Date from Expiry Date
Price which exercisable
(pence)
--------------- ------------- --------------- ------------------- --------------
29 March 2 January 28 March
2013 4,050,000 10 2014 2023
--------------- ------------- --------------- ------------------- --------------
31 July 2 January 30 July
2014 388,349 7.88 2016 2024
--------------- ------------- --------------- ------------------- --------------
24 November 1 January 23 November
2014 1,000,000 7.75 2017 2024
--------------- ------------- --------------- ------------------- --------------
1 April 31 March
2015 500,000 9.625 1 April 2018 2025
--------------- ------------- --------------- ------------------- --------------
15 December 15 December 14 December
2015 3,300,000 8.888 2018 2025
--------------- ------------- --------------- ------------------- --------------
14 July 13 July
2016 2,700,000 8.125 14 July 2016 2026
--------------- ------------- --------------- ------------------- --------------
15 February 26 October 14 February
2017 500,000 5.63 2019 2027
--------------- ------------- --------------- ------------------- --------------
7 March 6 March
2017 500,000 5.75 7 March 2020 2027
--------------- ------------- --------------- ------------------- --------------
31 March 30 March
2017 5,075,283 5.911 31 March 2017 2027
--------------- ------------- --------------- ------------------- --------------
12 July 11 July
2017 3,900,000 5.25 12 July 2020 2027
--------------- ------------- --------------- ------------------- --------------
Total 21,913,632
--------------- ------------- --------------- ------------------- --------------
6. BORROWINGS
On 31 July 2017, the Company drew down GBP1,000,000 of Tranche B of the Bond Subscription Agreement with Norgine Ventures Fund I SCA SICAR. The term of this tranche is 42 months with principal repayments commencing in August 2018 in monthly instalments. The interest rate is 10.1%.
7. INTERIM RESULTS
These results were approved by the Board of Directors on 4 December 2017. Copies of the interim report are available to the public from the Group's website, www.collagensolutions.com. If you would like to receive a hard copy of the interim report please contact the Collagen Solutions Plc offices on +44 (0)141 648 9100 to request a copy.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR OKQDKABDDBBK
(END) Dow Jones Newswires
December 05, 2017 02:00 ET (07:00 GMT)
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