Interim Results

RNS Number:4083L
Maelor PLC
02 November 2006



2nd November 2006


                                   Maelor plc

                                 Interim Results


Maelor plc, the specialist healthcare products company, is pleased to announce
its interim results for the six months ended 30th September 2006.


Financial Highlights


  * Turnover up 44% to #1.33 million (H1 2005: #923,000)
  * Operating loss significantly reduced to #93,000 (H1 2005: #429,000)
  * Interim loss per share of 0.22p (H1 2005: 1.17p)
  * Cash balance maintained at #1.25 million (H1 2005: #1.24 million)


Operational Highlights


Good progress in implementation of new strategy:


  * Building a specialist critical care business
      * 1st six months of active Volplex(R) promotion - sales increase 43% vs
        H1 2005
      * Decision taken to develop ISOplexTM, a late stage complementary
        critical care product
      * MHRA approve licence to supply unlicensed medicines ("specials")


  * Leveraging non critical care portfolio through efficient partnerships
      * 10% increase in OptiFlo in-market sales vs H1 2005
      * Collaboration with Plethora for micelle nanotechnology progressing
        well


Commenting on the results CEO, Tim Wright, said:


"Five months ago, the Board outlined its vision of establishing Maelor as an
ambitious new force in specialist critical care medicine, while commercialising
our non-critical care portfolio through efficient partnerships.


"The new management team has worked determinedly over the last period to ensure
delivery against this vision. We have driven significant growth in our recently
launched brand Volplex, taken the decision to develop ISOplex, a late stage
complementary critical care product and been granted a licence by the MHRA to
sell unlicensed medicines ("specials"). In parallel we continue to see the
benefits of selecting and supporting capable partners, with the continued growth
of OptiFlo and exploitation of our micelle nanotechnology through Plethora
Solutions.


"The interim results reinforce the rapid progress our business is now making,
enabling the management team to look forward with confidence to realising our
vision of building a successful, profitable, specialist critical care business."




For further information contact:



Maelor plc
Tim Wright, Chief Executive Officer       -  01978 810 153



Financial Dynamics
Billy Clegg / Ed Westropp   -  020 7831 3113





CHAIRMAN AND CHIEF EXECUTIVE OFFICER'S STATEMENT

We are pleased to report that the Company's interim results for the six months
to 30th September 2006 show substantially increased revenues, reduced losses and
a strong cash balance.

In June, together with our year end results, we announced the outcome of the
Board's strategic review, outlining our vision to establish Maelor as an
ambitious new force in specialist critical care medicine, while commercialising
our non-critical care portfolio through efficient partnerships.

In the last period the new management team has worked determinedly to ensure
delivery against this vision.

We have driven significant growth in our recently launched brand Volplex, taken
the decision to develop ISOplex, a late stage, complementary, critical care
product and been granted a licence by the Medicines and Healthcare products
Regulatory Agency ("MHRA") to supply unlicensed medicines ("specials"). In
parallel we continue to see the benefits of selecting and supporting capable
partners, with the continued growth of OptiFlo and exploitation of our micelle
nanotechnology through Plethora Solutions.

The 44% increase in turnover, significant reduction of operating losses to
#93,000, improved gross margin and sustained strong cash balance (#1.25 million)
reinforce the rapid progress our business is now making, enabling Maelor to look
forward with confidence to realising our vision of building a successful,
profitable, specialist critical care business.


Financial summary

Turnover for the six months to 30th September 2006 was #1.33 million (H1 2005:
#923,000) representing an increase of 44% over the period last year.  This
significant increase can be attributed to the re-acquisition and growth of
Volplex, the continued sales and market share growth of OptiFlo, as well as the
licensing milestone payment received for our micelle lidocaine nanotechnology.

The Group's operating loss for the period was again significantly reduced to
#93k driven by the continued healthy sales growth, as well as the above
milestone payment. This milestone payment combined with further efficiencies in
manufacturing and supply has contributed to the improvement in gross margin.

Group cash balances at 30th September 2006 were #1.25 million, an improvement on
last year's H1 balance of #1.24 million, demonstrating that measures taken at
the end of calendar year 2005 to ensure efficient management of cash flow
continue to be effective.


Business summary

"Building a specialist critical care business"

During the period the management team has focused on growing sales of Volplex,
currently used in operating theatres and hospital wards to maintain blood
volume.  The results of these efforts have seen a number of new hospitals
purchasing Volplex with in-market sales up 43% versus H1 2005.  With substantial
room for market share growth the team is confident that we can continue to win
further new accounts and continue to grow our sales of Volplex.

Maelor is also focused on adding new products to the portfolio either through
in-licensing or development of late stage opportunities, which reinforce our
development and commercial expertise and presence.  A critical aspect of this
strategy is building strong relationships with the critical care community to
identify potential products that will benefit their patients.

As a result of customer research the decision has been taken to develop ISOplex.
ISOplex in common with Volplex will be used in situations where an increase in
blood volume is required. ISOplex has been designed to very closely mimic
natural blood plasma, particularly in the balance of electrolytes.  The use of
these more "isotonic" formulations is an area of significant interest amongst
critical care clinicians.  The introduction of ISOplex will support Maelor's
strategy of driving both market share and market size in the gelatin segment of
the UK blood volume replacement market. Given Maelor's experience and existing
data in this sector it is anticipated that development will be relatively rapid
and inexpensive for a pharmaceutical product, with approval possible by the end
of 2008.

During the period Maelor has succeeded in gaining a licence from the MHRA to
sell un-licensed medicines. Generally known as "specials" these products can be
requested by physicians for use in patients where there is a specific
requirement and no medicine licensed in the UK to fulfill it.  "Specials" can
either be products which have been licensed elsewhere in Europe and imported or
those that are manufactured in specifically approved UK facilities.  This
initiative is intended to be a support service to critical care patients and
physicians; products provided are likely to fulfill niche areas of unmet need.
In addition to establishing closer relationships with the critical care
community this strategy will enable Maelor to gauge demand for products and
where this demand is sufficient, progress these to licence. An agreement has
recently been concluded to offer a portfolio of fluid support products,
currently licensed in Germany.

"Commercialising the non-critical care portfolio through efficient partnerships"

OptiFlo, the UK brand of catheter flushing solutions distributed by Bard,
continues to perform well, with sales up 10% versus H1 2005, and remains the UK
market leader with market share of 54% versus 49% (H1 2005) in a market that has
itself grown by 5%.

H1 2006 turnover incorporates the licensing milestone for our proprietary
micelle nanotechnology, micelle lidocaine.  The agreement with Plethora, a
specialist urology company, is progressing well.  Under the terms of the
agreement Plethora is responsible for product development and distribution and
Maelor is entitled to milestone and royalty payments. Micelle lidocaine is in
development for the treatment of interstitial cystitis and painful bladder
syndrome. These conditions are estimated to afflict up to two million women in
the United States and Europe.

As we identified in the recent strategic review, a primary activity of recent
months has been to provide clarity and focus to the business.  The product
portfolio has been rationalised in line with this plan as has our geographical
focus to prioritise our efforts in the UK.  While assessment of the opportunity
for ContiSol in the US and regulatory process for Volplex in China continue,
these activities are considered secondary to our focus of building a specialist
critical care business in the UK.


Outlook

The announcement of our 2005/06 results on 1st June enabled us to set out a
clear vision for Maelor and to clarify a number of outstanding questions from
shareholders. We committed at that time to delivering the milestones that will
enable us to become established as a successful, profitable, specialist critical
care business. The Board is acutely aware of the importance of Maelor delivering
against these promises.

The growth of Volplex, the addition of ISOplex and the in-licensing of a
specials portfolio, coupled with the continued exploitation of the non-critical
care products are the first steps towards delivering against this commitment.

The Board is confident that Maelor is now delivering against clear objectives,
an achievement which is reinforced by continued positive trading since the
period end. We are confident that Maelor will continue to make progress and the
Board wishes to thank all members of the Maelor team for their commitment as we
continue building a leading, specialist critical care business.


Geoff McMillan, Tim Wright

Chairman, Chief Executive Officer





Consolidated Profit and Loss Account
for the six months ended 30 September 2006

                                                          Unaudited          Unaudited   Audited Year ended
                                                   Six months ended   Six months ended        31 March 2006
                                                  30 September 2006  30 September 2005                    #
                                                                  #                  #

Turnover                                                  1,332,966            923,272            1,858,750
Cost of sales                                             (714,094)          (559,172)          (1,117,782)

Gross profit                                                618,872            364,100              740,968
Research and development                                   (44,502)           (79,606)             (89,888)
Sales and administrative expenses                         (667,070)          (713,177)          (1,259,627)

Operating loss                                             (92,700)          (428,683)            (608,547)
Interest receivable and similar income                       23,929             28,324               51,784
Interest payable                                            (6,170)            (6,907)             (13,351)

Loss on ordinary activities before taxation                (74,941)          (407,266)            (570,114)
Taxation                                                          -              9,581             (90,478)
Retained loss attributable to the Group                    (74,941)          (397,685)            (660,592)

Basic loss per ordinary share                               (0.22)p            (1.17)p              (1.93)p
Diluted loss per ordinary share                             (0.22)p            (1.17)p              (1.93)p



The Group's activities are classified as continuing.



No separate Statement of Total Recognised Gains and Losses has been presented as
all such gains and losses have been dealt with in the Consolidated Profit and
Loss Account.





Consolidated Balance Sheet
at 30 September 2006
                                                             Unaudited           Unaudited          Audited
                                                    30 September  2006  30 September  2005    31 March 2006
                                                                     #                   #                #
Fixed assets
Tangible assets                                                375,551             392,004          383,305

Current assets
Stock                                                          129,546             125,305          205,590
Debtors - due within one year                                  457,174             808,915          379,374
             - due after more than one year                          -              80,000                -
Cash at bank and in hand                                     1,251,980           1,235,727        1,296,463

                                                             1,838,700           2,249,947        1,881,427

Creditors: amounts falling due within one year               (733,152)           (801,674)        (696,553)

Net current assets                                           1,105,548           1,448,273        1,184,874

Total assets less current liabilities                        1,481,099           1,840,277        1,568,179
Creditors: amounts falling due after more than           
one year                                                     (161,760)           (183,090)        (173,899)

Net assets                                                   1,319,339           1,657,187        1,394,280

Capital and reserves
Called up share capital                                      3,428,083           3,428,083        3,428,083
Shares to be issued                                             23,017              23,017           23,017
Share premium account                                       12,154,094          12,154,094       12,154,094
Revaluation reserve                                            149,909             153,689          151,169
Profit and loss account                                   (14,435,764)        (14,101,696)     (14,362,083)

Shareholders' funds - equity                                 1,319,339           1,657,187        1,394,280






Consolidated Cash Flow Statement
for the six months ended 30 September 2006

                                               Unaudited Six months      Unaudited Six         Audited Year
                                                 ended 30 September    months ended 30                ended
                                                               2006     September 2005        31 March 2006
                                                                  #                  #                    #

Cash flow from operating activities                        (50,236)          (244,260)            (300,746)
Returns on investments and servicing of                      17,759             19,326               38,433
finance
Taxation received                                                 -                  -              108,487
Capital expenditure                                         (1,276)           (15,272)             (15,857)

Cash outflow before management of liquid                  
resources and financing                                    (33,753)          (240,206)            (169,683)
Financing                                                  (10,730)              8,241              (1,546)

Decrease in cash in the period/year                        (44,483)          (231,965)            (171,229)




Reconciliation of Net Cash Flow to Movement in Net Funds
for the six months ended 30 September 2006

                                               Unaudited Six months      Unaudited Six         Audited Year 
                                                 ended 30 September    months ended 30                ended
                                                               2006     September 2005        31 March 2006

                                                                  #                  #                    #
Decrease in cash in the period/year                        (44,483)          (231,965)            (171,229)
Cash outflow from decrease in debt and lease                 10,730              9,384               19,171
financing
Changes in funds resulting from cash flows                 (33,753)          (222,581)            (152,058)
Movement in net funds in the period/year                   (33,753)          (222,581)            (152,058)
Net funds at the start of the period/year                 1,103,663          1,255,721            1,255,721
Net funds at the end of the period/year                   1,069,910          1,033,140            1,103,663





Reconciliation of Operating Loss to Operating Cash Flows
for the six months ended 30 September 2006


                                               Unaudited Six months      Unaudited Six         Audited Year 
                                                 ended 30 September    months ended 30                ended
                                                               2006     September 2005        31 March 2006
                                                                  #                  #                    #

Operating loss                                             (92,700)          (428,683)            (608,547)
Depreciation charge                                           9,030              7,861               16,898
Loss on disposal of fixed asset                                   -                  -                  247
Charge for share options                                          -             23,017               23,017
Decrease/(increase) in stocks                                76,044              6,833             (73,452)
(Increase)/decrease in debtors                             (77,800)          (136,461)              162,443
Increase in creditors                                        35,190            283,173              178,648

Net cash flow from operating activities                    (50,236)          (244,260)            (300,746)





Notes to the Financial Statements


1.    The interim results for the six months ended 30 September 2006 are
unaudited. The financial information set out in this statement does not
constitute statutory accounts within the meaning of section 240 of the Companies
Act 1985. The comparative figures for the financial year ended 31 March 2006 are
not the statutory accounts for the financial year but are abridged from those
accounts which have been reported on by the Group's auditors and delivered to
the Registrar of Companies. The report of the auditors was unqualified and did
not contain a statement under section 237 (2) or (3) of the Companies Act 1985.


2.    The interim results, which were approved by the Board of Directors on 1
November 2006, are prepared on the basis of the accounting policies that will be
applied in the statutory accounts of the Group for the year ending 31 March
2007, in accordance with UK GAAP.


3.    Whilst further progress has continued to be made by the Group during the
period, profitable trading is yet to be established. Cash will continue to be
absorbed until at least that point in time. The Board will continue to monitor
the financial position in order to ensure that the Group has sufficient funding
to remain in business. For this reason, they continue to adopt the going concern
basis in preparing the financial statements.


4.    Copies of this interim report are available from the Group's registered
office at:





Riversdale
Cae Gwilym Road
Newbridge
Wrexham
LL14 3JG




Company Information


Directors


H G McMillan                                    (Non-executive Chairman)
T Wright                                        (Chief Executive Officer)
N J Goldsmith                                   (Finance Director - appointed 12 June 2006)
A Hardy                                         (Operations Director)
J H Gregory                                     (Non-executive Director)
P Murray                                        (Non-executive Director)

Secretary


N J Goldsmith                                   (appointed 12 June 2006)
T Wright                                        (appointed 24 May 2006 - resigned 12 June 2006)
M A Cope                                        (resigned 24 May 2006)



Registered office

Riversdale
Cae Gwilym Road
Newbridge
Wrexham
LL14 3JG


Company registration number

3337415


Brokers                                         Solicitors

Lewis Charles Securities Limited                Brabners Chaffe Street
4-7 Chiswell Street                             1 Dale Street
London EC1Y 4UP                                 Liverpool

                                                L2 2ET


Nominated advisors                              Principal bankers

City Financial Associates Limited               HSBC
Pountney Hill House                             17-19 Regent Street
6 Laurence Pountney Hill                        Wrexham
London EC4R 0BL                                 LL11 1RY


Auditors                                        Registrars

Baker Tilly                                     Capita Registrars
Number One                                      The Registry
Old Hall Street                                 34 Beckenham Road
Liverpool                                       Beckenham
L3 9SX                                          Kent
                                                BR3 4TU






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