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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Venn Life Sciences Holdings Plc | LSE:VENN | London | Ordinary Share | GB00B9275X97 | ORD 0.1P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 6.85 | 6.70 | 7.00 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From May 2019 to May 2024
TIDMVENN
RNS Number : 1499A
Venn Life Sciences Holdings PLC
22 March 2017
22 March 2017
Venn Life Sciences Holdings Plc
("Venn" or the "Company")
Final Results for the year ended 31 December 2016
Venn Life Sciences (AIM: VENN), a growing Contract Research Organisation (CRO) providing drug development, clinical trial management and resourcing solutions to pharmaceutical, biotechnology and medical device clients, announces its audited final results for the year ended 31 December 2016.
Financial Highlights
-- 57% growth in Total Income to EUR18.2m (2015: EUR11.6m)
-- EBITDA profit (before exceptionals and discontinued operations) of EUR0.39m (2015 as restated: EUR0.83m)
-- Profit for the year after tax of EUR0.55m (2015: loss of EUR0.20m) -- Cash and cash equivalents of EUR3.4m at 31 December 2016 (31 December 2015: EUR3.8m) -- Profit on divestment of Innovenn of EUR1.29m
Operational Highlights
-- Kinesis integration progressing well with cross-selling opportunities being delivered -- Key project milestones achieved leading to client endorsements and increased repeat business
-- Continued progress on systems infrastructure implementation delivering improvements in operating margins
-- Simplification of business with spin out of Innovenn -- Board renewal -
o Appointment of Allan Wood as Non-executive Chairman
o Appointment of Mary Sheahan as Non-executive Director
o Retirement of Kees Groen as Non-executive Director
Post period-end
-- Strong momentum experienced in 2016 has continued into 2017 to date -- Contract wins of EUR5.7m in January and February
Commenting on the Group's outlook, Tony Richardson, CEO of Venn, said:
"2016 has been another strong year for Venn with significantly increased revenue and improved profits after tax. We have started 2017 with a simplified business, purely focused on service delivery with a strong backlog and pipeline of new opportunities. The Venn Kinesis combination has been well received by clients and significantly differentiates us in our market place. With initial integration objectives achieved we now look forward to capitalising on our clear positioning. I would like to express my thanks to Kees Groen for his support and contribution during what was a critical transition year. The strong momentum enjoyed by the business in 2016 has continued into 2017 to date. In the first two months of 2017, we have secured new contracts valued at EUR5.7m and our pipeline of opportunities is healthy. We will continue to expand our geographical coverage and further develop emerging areas of specialism during 2017. Our industry sector continues to deliver good growth and clear opportunities exist for Venn to grow both organically and through acquisition."
Enquiries:
Venn Life Sciences Holdings Plc Allan Wood, Non-Executive Chairman Tony Richardson, Chief Executive Officer Tel: +353 1 5499341 Davy (Nominated Adviser and Broker) Fergal Meegan / Matthew de Vere Tel: +353 1 679 6363 White (Corporate Finance) Orla Bolger (Corporate Broking) Hybridan LLP (Co-Broker) Tel: +44 (0)20 3764 2341 Claire Louise Noyce Walbrook PR Ltd Tel: +44(0)20 7933 8787
Chairman's Statement
For the year ended 31 December 2016
Dear Fellow Shareholder,
I am pleased to report that 2016 has been another year of significant progress for Venn, delivering strong revenue and order book growth. Our key priorities for 2016 included the integration of Kinesis with a particular focus on cross-selling initiatives across early and late phase and the ongoing implementation of key systems and process improvements to ensure our business is ready for future growth.
I am particularly pleased with how well the combined customer base has responded to the Kinesis acquisition and this has re-enforced our view that the move into early phase consulting would prove to be a sensible strategic step for Venn.
The Venn team continue to deliver high quality work on challenging projects in cutting edge therapies and our back catalogue of valuable case studies continues to develop. This track record of successful execution will be particularly relevant as the business starts to develop and grow areas of specialism, ultimately making Venn a higher value business.
We have also recently bolstered the management team with key hires in the areas of Information Technology, Quality Assurance and Operations Support and we will continue to build our talent pool further as we move into the next phase of growth.
We continue to look for sensible opportunities for territorial growth in Europe consistent with our objective to develop Venn as a full service, full coverage organisation.
Finally, our decision to spin out Innovenn in 2016 has enabled management to singularly focus on Venn as a full service organisation and I believe in time that this clearer business positioning will benefit all of our stakeholders.
Allan Wood
Chairman
Chief Executive's Statement
For the year ended 31 December 2016
Dear Fellow Shareholder,
Results and Commentary
Total income for the full year was EUR18.2m (2015: EUR11.6m) representing a 57% increase year on year. The business delivered strong growth in revenues and order book across both its early and late phase businesses. EBITDA before exceptional charges was EUR0.39m (2015 of EUR0.83m as restated). Group profit after tax was EUR0.55m (2015 Loss EUR0.2m) including a profit on disposal of Innovenn of EUR1.29m. The consolidated balance sheet as at 31 December 2016 had total net assets of EUR10.3m, EUR3.4m of which was represented by cash and cash equivalents (2015: EUR3.8m). Reported EBITDA for 2016 was adversely impacted by a bad debt write off in the amount of EUR236,000. This bad debt relates to a legacy amount irrecoverable from an earlier acquisition. Also included are EUR100,000 of costs related to an acquisition opportunity that was not pursued to completion. There is an additional EUR25,000 relating to corporate reorganisaiton costs associated with simplifying the Group's structure and a further EUR134,000 relating to foreign exchange losses on reorganisation.
2016 was Kinesis's first full year as part of the Group. During the year, we initiated a number of changes involving leadership renewal and business development. We also delivered support function synergies, achieved initial cross-sales between the Venn and Kinesis client bases and grew the resource bases of the combined businesses. I continue to be impressed with the very significant knowledge base, flexibility and commitment of the Kinesis team and this coupled with a strong pipeline and some cost savings effective Q1 2017 will see a growing and improved profit contribution delivered by Kinesis in 2017 and beyond.
During 2016 we won an increased number of mandates involving large scale, long term projects in the late phase part of our business. These wins have been a core priority for Venn as we grow, but the profile of these projects differs from our pipeline to date in terms of timing and workflow management. While it is a significant positive that we are winning larger projects, it is also the case that short term profitability can be affected due to the timing of project activity. We have worked diligently to ensure that we can couple these larger projects with multiple small projects to ensure a smoother workflow, more optimal resource utilisation and therefore greater profitability going into 2017.
Plans and Outlook
The strong momentum enjoyed by the business in 2016 has continued into 2017 to date. In the first two months of 2017, we have secured new contracts valued at EUR5.7m and our pipeline of opportunities is healthy. We will continue to expand our geographical coverage and further develop emerging areas of specialism during 2017. Our industry sector continues to deliver good growth and clear opportunities exist for Venn to grow both organically and through acquisition.
Anthony Richardson
Chief Executive Officer
22 March 2017
Consolidated Statement of Comprehensive Income
For the year ended 31 December 2016
Hot Features
Premium
2016 2015 (restated)
Notes EUR'000 EUR'000
----------------------------------------------- --------- ----------------
Continuing operations
Revenue 17,909 11,468
Direct Project and Administrative
Costs (18,805) (11,404)
Other operating income 335 175
Operating profit/(loss) (561) 239
--------- ----------------
Depreciation (133) (75)
Amortisation (689) (311)
Exceptional items (125) (209)
EBITDA before exceptional items 386 834
--------- ----------------
Finance income 12 2
Finance costs - (41)
Share of loss of investments
accounted for using the equity
method (364) -
--------------------------------------- ------- --------- ----------------
Profit/(loss) before income
tax (913) 200
Income tax credit 169 60
------------------------------------------------ --------- ----------------
Profit/(loss) for the year from
continuing operations (744) 260
------------------------------------------------ --------- ----------------
Discontinued operations
Profit for the year from discontinued
operations 1,295 (462)
------------------------------------------------ --------- ----------------
Profit for the year 551 (202)
------------------------------------------------ --------- ----------------
Profit for the year is attributable
to:
Owners of the parent 532 15
Non-controlling interests 19 (217)
------------------------------------------------ --------- ----------------
551 (202)
----------------------------------------------- --------- ----------------
Other comprehensive income
--------------------------------------- ------- --------- ----------------
Currency translation differences (36) 49
------------------------------------------------ --------- ----------------
Total comprehensive gain for
the year 515 (153)
------------------------------------------------ --------- ----------------
Total comprehensive gain/(loss)
for the year is attributable
to:
Owners of the parent 496 64
Non-controlling interests 19 (217)
------------------------------------------------ --------- ----------------
515 (153)
----------------------------------------------- --------- ----------------
Total comprehensive gain/(loss)
for the year attributable to
owners of the parent arises
from:
Continuing operations (799) 309
Discontinued operations 1,295 (245)
------------------------------------------------ --------- ----------------
496 64
----------------------------------------------- --------- ----------------
Earnings per share from continuing
and discontinued operations
attributable to owners of the
parent during the year
Basic profit/(loss) per ordinary
share
From continuing operations 14 (1.26c) 0.04c
From discontinued operations 14 2.14c -
------------------------------------ --- -------- ------
From profit/(loss) for the year 14 0.88c 0.04c
------------------------------------ --- -------- ------
Diluted profit/(loss) per ordinary
share
From continuing operations 14 (1.14) 0.04c
From discontinued operations 14 1.93c -
------------------------------------ --- -------- ------
From profit/(loss) for the year 14 0.79c 0.04c
------------------------------------ --- -------- ------
The Company has elected to take the exemption under section 408 of the Companies Act 2006 not to present the parent Company income statement account.
The profit for the parent Company for the year was EUR527,000 (2015 - loss of EUR336,000).
Consolidated and Company's Statement of Financial Position
As at 31 December 2016
Group Group Company Company
2016 2015 2016 2015
EUR'000 EUR'000 EUR'000 EUR'000
------------------------------- -------- -------- -------- --------
Assets
Non-current assets
Property, plant and
equipment 191 381 - -
Intangible assets 4,059 5,437 - -
Investments in subsidiaries - - 7,468 7,468
Investments 2,038 31 31 31
Total non-current assets 6,288 5,849 7,499 7,499
-------------------------------- -------- -------- -------- --------
Current assets
Trade and other receivables 4,979 5,560 8,918 8,220
Income tax recoverable 43 23 - -
Cash and cash equivalents 3,404 3,798 206 554
-------------------------------- -------- -------- -------- --------
Total current assets 8,426 9,381 9,124 8,774
-------------------------------- -------- -------- -------- --------
Total assets 14,714 15,230 16,623 16,273
-------------------------------- -------- -------- -------- --------
Equity attributable
to owners
Share capital 155 155 155 155
Share premium account 14,026 14,011 14,026 14,011
Group re-organisation
reserve (541) (541) - -
Merger relief reserve - - 3,531 3,531
Reverse acquisition
reserve 45 45 - -
Foreign currency reserves 13 49 - -
Share option reserve 28 13 28 13
Retained earnings (3,294) (3,826) (1,687) (2,351)
-------------------------------- -------- -------- -------- --------
10,432 9,906 16,053 15,361
Non-controlling interest - 327 - -
------------------------------- -------- -------- -------- --------
Total equity 10,432 10,233 16,053 15,361
-------------------------------- -------- -------- -------- --------
Liabilities
Non-current liabilities
Borrowings 25 52 - -
Total non-current liabilities 25 52 - -
-------------------------------- -------- -------- -------- --------
Current liabilities
Trade and other payables 3,661 4,218 570 912
Deferred taxation 561 692 - -
Deferred consideration - - - -
Borrowings 35 35 - -
Total current liabilities 4,257 4,945 570 912
-------------------------------- -------- -------- -------- --------
Total liabilities 4,282 4,997 570 912
-------------------------------- -------- -------- -------- --------
Total equity and liabilities 14,714 15,230 16,623 16,273
-------------------------------- -------- -------- -------- --------
Consolidated and Company's Statement of Cash Flows
For the year ended 31 December 2016
Group Group Company Company
2016 2015 2016 2015
EUR'000 EUR'000 EUR'000 EUR'000
Cash Flow from operating activities
Continuing operations
Cash used in operations (255) (2,275) (514) (4,737)
Interest paid - - - -
Income tax received/(paid) (89) 125 - (31)
-------------------------------------------------------- -------- -------- -------- --------
Net cash used in operating activities (344) (2,150) (514) (4,768)
-------------------------------------------------------- -------- -------- -------- --------
Cash flow from investing activities
Acquisition of subsidiaries, net of cash acquired - (1,893) - -
Acquisition of investments - - - -
Exceptional costs - (209) - -
Purchase of property, plant and equipment - (713) - (3,036)
Payments for shares acquired - - - -
Interest received - - - -
------------------------------------------------------- -------- -------- -------- --------
Net cash used in investing activities - (2,815) - (3,036)
-------------------------------------------------------- -------- -------- -------- --------
Cash flow from financing activities
Proceeds from issuance of ordinary shares (29) 8,571 29 8,571
Payment of deferred consideration - (310) - (213)
Financing from non-controlling interests - - - -
Repayments on borrowings (26) (94) - -
Net cash generated by financing activities (55) 8,167 29 8,358
-------------------------------------------------------- -------- -------- -------- --------
Net increase/ (decrease) in cash and cash equivalents (399) 3,202 (485) 554
Cash and cash equivalents at beginning of year 3,798 596 554 -
Exchange losses on cash and cash equivalents 5 - 1 -
-------------------------------------------------------- -------- -------- -------- --------
Cash and cash equivalents at end of year 3,404 3,798 70 554
-------------------------------------------------------- -------- -------- -------- --------
Consolidated and Company's Statement of Changes in Shareholders' Equity
Group
Re-organisation
& Reverse Share Foreign
Share Share acquisition Option currency Retained Non-controlling
capital premium reserve reserve reserve earnings Total interests Total
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
--------------- --------- --------- ---------------- -------- ---------- ---------- -------- ----------------- --------
At 1 January
2015 112 5,483 (496) - - (3,841) 1,258 544 1,802
--------------- --------- --------- ---------------- -------- ---------- ---------- -------- ----------------- --------
Changes in
equity for the
year
ended 31
December 2015
Profit/ (Loss)
for the year - - - - - 15 15 (217) (202)
Currency
translation
differences - - - - 49 - 49 - 49
--------------- --------- --------- ---------------- -------- ---------- ---------- -------- ----------------- --------
Total
comprehensive
profit
/(loss) for
the year - - - - 49 15 64 (217) (153)
--------------- --------- --------- ---------------- -------- ---------- ---------- -------- ----------------- --------
Transactions
with the
owners
Shares issued 43 8,528 - - - - 8,571 - 8,571
Options issued - - - 13 - - 13 - 13
--------------- --------- --------- ---------------- -------- ---------- ---------- -------- ----------------- --------
Total
contributions
by and
distributions
to owners 43 8,528 - - - - 8,584 - 8,584
--------------- --------- --------- ---------------- -------- ---------- ---------- -------- ----------------- --------
At 31 December
2015 155 14,011 (496) 13 49 (3,826) 9,906 327 10,233
--------------- --------- --------- ---------------- -------- ---------- ---------- -------- ----------------- --------
Changes in
equity for the
year
ended 31
December 2016
Profit/ (Loss)
for the year - - - - - 532 532 (327) 205
Currency
translation
differences - - - - (36) - (36) - (36)
--------------- --------- --------- ---------------- -------- ---------- ---------- -------- ----------------- --------
Total
comprehensive
profit
/(loss) for
the year - - - - (36) 532 496 (327) 169
--------------- --------- --------- ---------------- -------- ---------- ---------- -------- ----------------- --------
Transactions
with the
owners
Shares issued - 15 - - - - 15 - 15
Options issued - - - 15 - - 15 - 15
Total
contributions
by and
distributions
to owners - 15 - 15 - - 30 - 30
--------------- --------- --------- ---------------- -------- ---------- ---------- -------- ----------------- --------
At 31 December
2016 155 14,026 (496) 28 13 (3,294) 10,432 - 10,432
--------------- --------- --------- ---------------- -------- ---------- ---------- -------- ----------------- --------
Company
Share Share Retained
Share capital premium Option reserve Merger relief reserve earnings Total
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
------------------------- ---------------- --------- ---------------- ---------------------- ---------- --------
As at 1 January 2015 112 5,483 - 3,531 (2,015) 7,111
------------------------- ---------------- --------- ---------------- ---------------------- ---------- --------
Changes in equity for
the year ended
31 December 2015
Total comprehensive loss
for the year - - - - (336) (336)
Issued in year 43 8,528 13 - - 8,584
At 31 December 2015 155 14,011 13 3,531 (2,351) 15,359
------------------------- ---------------- --------- ---------------- ---------------------- ---------- --------
Changes in equity for
the year ended
31 December 2016
Total comprehensive gain
for the year - - - -- 664 664
Issued in year - 15 15 - - 30
At 31 December 2016 155 14,026 28 3,531 (1,687) 16,053
------------------------- ---------------- --------- ---------------- ---------------------- ---------- --------
1. General information
Venn Life Sciences Holdings Plc is a company incorporated in England and Wales. The Company is a public limited company listed on the AIM market of the London Stock Exchange. On 18 January 2016, the company also listed on the ESM market of the Irish Stock Exchange. The address of the registered office is 1 Berkeley Street, London, W1J 8DJ.
The principal activity of the Group is that of a Clinical Research Organisation providing a suite of consulting and clinical trial services to pharmaceutical, biotechnology and medical device organisations. The Group has a presence in the UK, Ireland, France, Netherlands, Germany and Singapore.
The financial statements are presented in Euros, the currency of the primary economic environment in which the Group's trading companies operate. The Group comprises Venn Life Sciences Holdings Plc and its subsidiary companies.
The registered number of the Company is 07514939.
2. Segmental reporting
Management has determined the Group's operating segments based on the monthly management reports presented to the Chief Operating Decision Maker ('CODM'). The CODM is the Executive Directors and the monthly management reports are used by the Group to make strategic decisions and allocate resources.
The principal activity of the Group is that of a Clinical Research Organisation (CRO) providing a suite of consulting and clinical trial services to pharmaceutical, biotechnology and medical device organisations. Prior to 2015, the CODM considered the Group's operating segments to be the individual countries of operation. However, as the majority of the Group's contracts are now larger, multi-country contracts, pulling resources from many different locations, the CODM now considers this a single business unit.
Prior to 2016, the Group had an innovation division focussed on human skin technologies that was considered by the CODM as a separate segment. This division was sold to Integumen Limited during 2016 and is disclosed in the consolidated statement of comprehensive income as discontinued operations. As such, no comparatives are provided for 2016 in the segmental analysis.
Currently the key operating performance measures used by the CODM are Revenue and adjusted EBITDA (before exceptionals).
The segment information provided to the Board for the reportable segments for the year ended 31 December 2016 is as follows:
2016 2016 2016 2015 2015 2015
Venn Innovenn Total Venn Innovenn Total
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
--------------------------- -------- --------- -------- -------- --------- --------
Income statement
External revenue 18,244 - 18,244 11,643 6 11,649
--------------------------- -------- --------- -------- -------- --------- --------
Adjusted EBITDA 386 - 386 834 (446) 388
Exceptional items (125) - (125) (209) - (209)
---------------------------
EBITDA 261 - 261 625 (446) 179
Depreciation (133) - (133) (75) (28) (103)
Amortisation (689) - (689) (311) (50) (361)
--------------------------- -------- --------- -------- -------- --------- --------
Operating profit/(loss) (561) - (561) 239 (524) (285)
Net finance income/
(costs) 12 - 12 (39) (3) (42)
Retained profit/(loss)
before tax 549 - 549 200 (527) (327)
--------------------------- -------- --------- -------- -------- --------- --------
Segment assets
Intangibles, Goodwill, 4,059 - 4,059 4,743 693 5,436
PPE 191 - 191 223 158 381
Investments 2,038 - 2,038 31 - 31
Trade and other debtors 5,022 - 5,022 5,455 128 5,583
Inter segment debtors - - - 999 - 999
Cash 3,404 - 3,404 3,768 30 3,798
--------------------------- -------- --------- -------- -------- --------- --------
Total assets 14,714 - 14,714 15,220 1,009 16,228
--------------------------- -------- --------- -------- -------- --------- --------
Segment liabilities
Operating liabilities (4,222) - (4,222) (4,737) (174) (4,911)
Inter segment liabilities - - - - (999) (999)
--------------------------- -------- --------- -------- -------- --------- --------
(4,222) - (4,222) (4,737) (1,173) (5,910)
Borrowings (60) - (60) (87) - (87)
--------------------------- -------- --------- -------- -------- --------- --------
Total liabilities (4,282) - (4,282) (4,824) (1,173) (5,997)
--------------------------- -------- --------- -------- -------- --------- --------
3. Exceptional items
Included within Administrative expenses are exceptional items as shown below:
2016 2015
EUR'000 EUR'000
------------------------------------------ -------- --------
Exceptional items includes:
- Transaction costs relating to business
combinations and acquisitions 79 209
- office relocation 46 -
Total exceptional items 125 209
------------------------------------------- -------- --------
4. Finance income and costs
2016 2015
EUR'000 EUR'000
------------------------------------------ -------- --------
Interest expense:
- Bank borrowings - 27
- Interest on other loans - 17
------------------------------------------ -------- --------
Finance costs - 44
------------------------------------------ -------- --------
Finance income
- Interest income on cash and short-term
deposits 12 2
------------------------------------------ -------- --------
Finance income 12 2
------------------------------------------ -------- --------
Net finance income (12) 42
------------------------------------------ -------- --------
5. Income tax expense
2016 2015
Group EUR'000 EUR'000
--------------------------------------------------- -------- --------
Current tax:
Current tax for the year (38) -
Tax refund (prior year) - (65)
--------------------------------------------------- -------- --------
Total current tax (credit)/charge (38) (65)
--------------------------------------------------- -------- --------
Deferred tax:
Origination and reversal of temporary differences (131) (60)
--------------------------------------------------- -------- --------
Total deferred tax (131) (60)
--------------------------------------------------- -------- --------
Income tax (credit)/charge (169) (125)
--------------------------------------------------- -------- --------
The tax on the Group's results before tax differs from the theoretical amount that would arise using the standard tax rate applicable to the profits of the consolidated entities as follows:
2016 2015
EUR'000 EUR'000
------------------------------------------------- -------- --------
Loss before tax (664) (262)
------------------------------------------------- -------- --------
Tax calculated at domestic tax rates applicable
to UK standard rate of tax of 20% (2013 -
20%) (183) (52)
Tax effects of:
- Expenses not deductible for tax purposes 26 30
- Losses carried forward/(utilised) 118 (38)
Tax (credit)/charge (38) (60)
------------------------------------------------- -------- --------
There are no tax effects on the items in the statement of comprehensive income.
6. Loss per share
(a) Basic
Basic loss per share is calculated by dividing the loss attributable to equity holders of the Company by the weighted average number of ordinary shares in issue during the year.
2016 2015
EUR'000 EUR'000
Profit/(loss) from continuing operations
attributable to equity holders of the
Company (763) 15
Profit from discontinued operations
attributable to equity holders of the
Company 1,295 -
------------------------------------------ ----------- -----------
Total 532 15
------------------------------------------ ----------- -----------
Weighted average number of Ordinary
Shares in issue 60,429,946 41,261,849
Basic profit/ (loss) per share 0.88c 0.04c
(b) Diluted
Diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares outstanding to assume conversion of all dilutive potential ordinary shares.
Weighted average number of shares used as the denominator
2016 2015
Weighted average number of ordinary
shares used as the denominator in
calculating basic earnings per share 60,429,946 41,261,849
Adjustments for calculation of diluted
earnings per share:
Options 6,510,000 -
Warrants 166,000 -
---------------------------------------- ----------- -----------
Total 67,106,612 41,261,849
---------------------------------------- ----------- -----------
7. Intangible fixed assets
Group Customer Intellectual
relationships Trade secrets Goodwill Property Rights Workforce Total
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
---------------------- --------------------- -------------- --------- --------------------- ---------- ---------
Cost
At 1 January 2015 605 709 1,320 224 104 2,962
Addition - - - 525 - 525
Exchange differences 2 3 11 (9) - 7
Adjustment (note 26) - - (48) - - (48)
On acquisition of
subsidiary
undertaking 1,032 - 117 - 1,345 2,494
---------------------- --------------------- -------------- --------- --------------------- ---------- ---------
At 31 December 2015 1,639 712 1,400 740 1,449 5,940
---------------------- --------------------- -------------- --------- --------------------- ---------- ---------
Amortisation
At 1 January 2015 95 33 - 5 9 142
Charge for the year 164 71 - 49 77 361
---------------------- --------------------- -------------- --------- --------------------- ---------- ---------
At 31 December 2015 259 104 - 54 86 503
---------------------- --------------------- -------------- --------- --------------------- ---------- ---------
Net book value
At 31 December 2015 1,380 608 1,400 685 1,363 5,437
---------------------- --------------------- -------------- --------- --------------------- ---------- ---------
Cost
At 1 January 2016 1,639 712 1,400 740 1,449 5,940
Addition - 29 - - - 29 Exchange differences (4) (6) (22) (57) - (89) On disposal of subsidiary - - - (683) - (683) At 31 December 2016 1,635 735 1,378 - 1,449 5,197 ---------------------- --------------------- -------------- --------- --------------------- ---------- --------- Amortisation At 1 January 2016 259 104 - 54 86 503 Charge for the year 328 71 - - 290 689 On disposal of subsidiary - - - (54) - (54) ---------------------- --------------------- -------------- --------- --------------------- ---------- --------- At 31 December 2016 587 175 - - 376 1,138 ---------------------- --------------------- -------------- --------- --------------------- ---------- --------- Net book value At 31 December 2016 1,048 560 1,378 - 1,073 4,059 ---------------------- --------------------- -------------- --------- --------------------- ---------- ---------
No amortisation charge has been charged on the goodwill in the income statement (2015 - EURnil).
On 24(th) October 2016 the group disposed of Innovenn UK Limited.
Goodwill is allocated to the Group's cash-generating units (CGU's) identified according to operating segment. An operating segment-level summary of the goodwill allocation is presented below.
2016 2015
EUR'000 EUR'000
---------- -------- --------
CRO 1,378 1,400
Innovenn - -
---------- -------- --------
Total 1,378 1,400
---------- -------- --------
Goodwill is tested for impairment at the balance sheet date. The recoverable amount of goodwill at 31 December 2016 was assessed on the basis of value in use. As this exceeded carrying value no impairment loss was recognised.
The key assumptions in the calculation to assess value in use are the future revenues and the ability to generate future cash flows. The most recent financial results and forecast approved by management for the next three years were used followed by an extrapolation of expected cash flows at a constant growth rate for a further two years. The projected results were discounted at a rate which is a prudent evaluation of the pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the cash-generating units.
The key assumptions used for value in use calculations in 2016 were as follows:
%
-------------------------------------- ---
Longer-term growth rate (after 2019) 5
Discount rate 20
--------------------------------------- ---
The Group has been loss making for the last 5 years and in 2014 the Directors transformed the infrastructure and capabilities of the Group in order to work as a Group in providing services to clinical research and development markets as one unit rather than separate units. This meant that the impairment review is prepared on the group basis rather than a single unit basis. The Directors have made significant estimates on future revenues and EBITDA growth over the next three years based on the Group's budgeted investment in recruiting key employees and marketing the services.
The Directors have performed a sensitivity analysis to assess the impact of downside risk of the key assumptions underpinning the projected results of the Group. The projections and associated headroom used for the group is sensitive to the EBITDA growth assumptions that have been applied. A 50% reduction in EBITDA growth; in the first five years of the management projections would not result in any impairment at the group level.
The Company has no intangible assets.
8. Investments in associates
Company 2016 2015 Shares in associated undertakings EUR'000 EUR'000 ----------------------------------- -------- -------- Beginning and End of the year - - ----------------------------------- -------- --------
On 24 October 2016 the Company's wholly owned subsidiary Venn Life Sciences Limited acquired a 41.51% holding in Integumen Limited, as consideration for the disposal of its holding in Innovenn UK Limited.
Integumen Limited has share capital consisting solely of ordinary shares, which are held directly by the Group; the country of incorporation and registration is also the principal place of business.
Integumen Limited is a private company and there is no quoted market price available for its shares.
The group has no other associates.
The Company has provided a guarantee for GBP819,453 debt held by Innovenn UK Limited at 31 December 2016. On 24 October 2015 Integumen acquired 100% of the share capital of Innovenn UK Limited.
Name of Company Note Proportion Held Class of Shareholding Nature of Business
Integumen Limited 1 41.51% (indirect) Ordinary Human Surface Science
Notes
1. Incorporated and registered in England and Wales.
Summarised financial information for Integumen Limited
Set out below is the summarised financial information for Integumen Limited. The information disclosed reflects the amounts presented in the financial statements of Integumen and not the group's share of those amounts. They have been amended to reflect adjustments made by the entity when using the equity method, including fair value adjustments and modifications for differences in accounting policy.
Summarised Balance Sheet 2016 2015
31 December GBP'000 GBP'000
------------------------------ -------- --------
Total current assets 348 -
Total current liabilities (1,564) -
Total non-current assets 8,499 -
Total non-current liabilities (635) -
------------------------------ -------- --------
Net assets 6,648 -
------------------------------ -------- --------
Reconciliation to carrying amounts: 2016 2015
GBP'000 GBP'000
------------------------------------ -------- --------
Opening net assets 1 January - -
(Loss) for the period (716) -
Net assets acquired (7,364) -
------------------------------------ -------- --------
Closing net assets 6,648 -
------------------------------------ -------- --------
Group's share in % 41.51% -
Group's share in GBP 2,768 -
------------------------------------ -------- --------
Carrying amount 1,805 -
------------------------------------ -------- --------
Summarised statement of comprehensive 2016 2015
income
31 December GBP'000 GBP'000
---------------------------------------- -------- --------
Revenue 11 -
Pre-tax loss from continuing operations (716) -
Post-tax loss from continuing (716) -
operations
---------------------------------------- -------- --------
Total comprehensive expense (716) -
---------------------------------------- -------- --------
The group has included its share of the associate's total comprehensive expense, being EUR364,281 (2015 - nil) in the Consolidated Income Statement using the equity method.
9. Cash used in operations
Group Group Company Company
2016 2015 2016 2015
EUR'000 EUR'000 EUR'000 EUR'000
--------------------------------- -------- --------- -------- --------
Loss before income tax (550) (327) (702) (336)
Adjustments for:
- (Gain)/Loss on Disposal (85) - - -
of Non-current asset
- Depreciation and amortisation 822 464 - -
- Release of escrow provision 136 - - -
- Foreign currency translation
of net assets 134 (204) (38) (164)
- Exceptional Item - 209 - 209
- Net finance costs (12) 42 - -
Changes in working capital
- Trade and other receivables (146) (3,463) (1,104) (4,688)
- Trade and other payables (554) 1,004 (74) 242
--------------------------------- -------- --------- -------- --------
Net cash used in operations (255) (2,275) (514) (4,737)
--------------------------------- -------- --------- -------- --------
10. Discontinued Operations
Disposal of Innovenn
On 24 October 2016 the Company's wholly owned Subsidiary Venn Life Sciences Limited disposed of its 70% holding of Innovenn UK Limited, and its wholly owned subsidiary Innovenn Limited, to Integumen Limited, a newly incorporated UK organisation focussing on human surface science (the integumentary system). The total consideration of EUR3,544,268 was settled by the allotment of 3,057,557 ordinary shares of GBP1.00 each in the capital of Integumen Limited, at par credited as fully paid, representing a 41.51% holding. Financial information relating to the discontinued operation for the period to the date of disposal is set out below.
Prior to the transaction, the Subsidiary converted its loan to Innovenn of EUR1,392,623 into ordinary shares of GBP0.001 each of Innovenn, increasing its shareholding to 70% of the issued share capital of Innovenn.
After 31 December 2016, the consideration was adjusted to a fair value as at 24 October 2016 of EUR2,371,318, based upon the Directors opinion of the market value of the group's investment in Integumen Limited.
The financial performance and cash flow information presented are for the period ended 24 October 2016 (2016 column) and the year ended 2015.
2016 2015
EUR'000 EUR'000
-------------------------------------------- -------- --------
Revenue 48 6
Expenses (1,105) (533)
Loss before tax (1,057) (527)
Tax 55 7
-------------------------------------------- -------- --------
Loss after tax of discontinued operation (1,002) (520)
Gain on sale of the subsidiary after tax 2,297 -
Profit /(loss) from discontinued operation 1,295 (520)
-------------------------------------------- -------- --------
Net cash inflow from operating activities 622 (821)
Net cash inflow from investing activities 151 851
Net cash outflow from financing activities (406) -
-------------------------------------------- -------- --------
Net increase in cash generated by the
subsidiary 367 30
-------------------------------------------- -------- --------
Details of the sale of the subsidiary 2016 2015
EUR'000 EUR'000
-------------------------------------------- -------- --------
Consideration received:
Shares in Integumen Limited 3,544 -
Fair value adjustment (1,173) -
-------------------------------------------- -------- --------
Total consideration 2,371 -
Carrying amount of net assets sold 74 -
-------------------------------------------- -------- --------
Gain on sale before tax 2,297 -
Income tax expense on gain - -
-------------------------------------------- -------- --------
Gain on sale after income tax 2,297 -
-------------------------------------------- -------- --------
11. Annual Report and Accounts
Copies of the audited Annual Report and Accounts for the year ended 31 Deceber 2016 will be posted to shareholders shortly and may also be obtained from the Company's head office at 19 Railway Road, Dalkey, Dublin, Ireland
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR UAAORBVAOUUR
(END) Dow Jones Newswires
March 22, 2017 03:00 ET (07:00 GMT)
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