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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Salvarx Group Plc | LSE:SALV | London | Ordinary Share | IM00BZ4SS228 | ORD 2.5P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 4.50 | 0.00 | 00:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From Nov 2019 to Nov 2024
TIDMSALV
RNS Number : 6206J
SalvaRx Group plc
13 September 2016
SalvaRx Group plc
("SalvaRx" or the "Company")
Half Yearly Report to 30 June 2016
SalvaRx Group plc (AIM: SALV), the drug development company focused on immunotherapy for cancer, is pleased to announce its interim results for the six months ended 30 June 2016.
Highlights
-- Reverse takeover of 3Legs Resources plc completed on 22 March 2016 in conjunction with a placing to raise GBP1.95 million (gross)
-- Dr Ian Walters, formerly of Bristol-Myers Squibb, appointed Chief Executive Officer
-- SalvaRx now focused on building a portfolio of cancer immunotherapy assets via acquisition and investment
-- iOx Therapeutics Ltd, in which SalvaRx has a 60.5% interest, awarded grant funding from the EU as part of a consortium developing new immunotherapy candidates (the funding will help cover significant portion of the clinical trials)
-- In April US$2 million invested for a 8.5% interest in US-based Intensity Therapeutics Inc., a private biotechnology company pioneering a new approach to treating solid tumours
-- Investment in Intensity, part funded by issue of US$1 million of zero coupon convertible unsecured loan notes
Chief Executive Officer's Statement
In the first half of 2016, we transformed the business to what is now a drug development company focused on the important area of cancer immunotherapy. This was achieved via the acquisition of SalvaRx Limited which constituted a reverse takeover under the AIM Rules. The Company's name was also changed to SalvaRx Group plc at the same time. Simultaneously we raised GBP1.95 million to support continued drug development at iOx Therapeutics Ltd ("iOx") in which we have a 60.5% interest. SalvaRx leadership has also augmented the iOx management team, as well as recruited a scientific advisory group and board of directors. We negotiated a collaborative research agreement for iOx with Oxford University, and secured the Horizon 2020 grant covering the development activities for iOx's two lead products.
In April we issued a convertible note and raised an additional US$1 million which enabled us to execute our second transaction which was to acquire a stake in a US company, Intensity Therapeutics, Inc. ("Intensity"). This has enabled us to build a product pipeline with several candidates funded through multiple rounds of clinical testing. In addition to funding, we have assisted iOx and Intensity to build teams to oversee the execution of their drug development work.
We are focused on getting our products ready for human testing. SalvaRx's goal is to develop products through to human proof of concept, (i.e. safety and efficacy in humans with some scientific evidence of activity against the target). This milestone represents a significant de-risking of a drug programme and a chance for substantial value inflection. We hope to have helped one of iOx's products and one of Intensity's products to enter the clinic in the next year. In both cases, we follow the reaction of patients tumour and health to these products, but we also take blood and tumour samples to analyse in the lab. Both companies are working with leading experts in this field and strive to understand how these drugs work, in which patients are they most likely to work and how can we make additional and or improved products in the future. I am pleased at the progress from iOx and Intensity in these areas.
We recently announced the award of a US patent for iOx drug IMM60 and also a licensing deal for a vaccine from the Ludwig Institute for Cancer Research to be used in combination with both IMM60 and IMM65. Intensity has also been granted a US patent and is preparing submissions with the US FDA and Health Canada with a goal to starting the first human studies in due course. I am very pleased with the progress at both companies where the management teams, advisory boards and boards of directors of these companies have been making sure that we have enough cash, adequate personnel and the proper strategies to deliver these medicines to cancer patients.
Our field has been exciting with several examples of success with cancer immunotherapies. More so than ever, combination therapy and patient selection are critical for commercial success in cancer treatment. Bristol-Myers Squibb(BMS) recently learned from a large global trial in lung cancer that their leading immunotherapy (Opdivo) did not work as a monotherapy in this study, and they are focusing their future efforts on combinations. Importantly, SalvaRx's strategy is to develop potential combination partners for PD-1 drugs. This strategy is not only critical to enable BMS's product to be used in broader patient population, it is also applicable to many of the big pharma companies which are focusing on this area. We have had preliminary discussions with many of these companies about our strategy and assets.
Outlook
The two lead compounds from iOx and the lead compound from Intensity are now capitalized sufficiently to get these products into the clinic. We continue to see new exciting opportunities in this space and are evaluating these for SalvaRx. Our efforts are being recognized by our peers and we continue to prioritize discussions with potential big pharma partners. I am hopeful that our innovative medicines can have an impact on the many cancer patients worldwide who have a need for new treatment options.
Dr Ian Walters
Chief Executive Officer
Enquiries
SalvaRx Group plc Ian Walters (Chief Executive) Tel: +1 203 441 5451 Northland Capital Partners Limited Tel: +44 (0)20 3861 6625 Nominated Adviser and Broker Matthew Johnson / Edward Hutton (Corporate Finance) John Howes / Abigail Wayne (Corporate Broking) Peterhouse Corporate Finance Limited Tel: +44 (0) 20 7469 0932 Lucy Williams / Duncan Vasey
SalvaRx Group plc
Consolidated income statement
For the six months ended 30 June 2016
Hot Features
Premium
Unaudited Unaudited Unaudited
Note Six 6 May 6 May
months 2015 2015
ended to 30 to 31
30 June June December
2016 2015 2015
GBP'000 GBP'000 GBP'000
Research and development (240) - (260)
Exceptional item (non-cash charge
arising on reverse takeover transaction) 2 (563) - -
Other operating costs (636) (11) (130)
Operating loss (1,439) (11) (390)
Finance cost 5 (25) - -
-------------------- ------------------- -------------------
Loss before tax (1,464) (11) (390)
Tax - - -
Net loss and comprehensive loss
for the period (1,464) (11) (390)
-------------------- ------------------- -------------------
Net loss and comprehensive loss
attributable to
Owners of the company (1,319) (11) (280)
Non-controlling interest (145) - (110)
(1,464) (11) (390)
-------------------- ------------------- -------------------
Loss per ordinary shares
Basic and diluted 6 (0.05p) (0.00p) (0.06p)
-------------------- ------------------- -------------------
*In accordance with note 3, and the adoption of reverse takeover accounting principles, comparatives are for SalvaRx Limited.
SalvaRx Group plc
Consolidated statement of financial position
As at 30 June 2016
Note Unaudited Unaudited Unaudited
30 June 2016 *30 June 2015 *31 December 2015
GBP'000 GBP'000 GBP'000
Assets
Non-current assets
Investment available for sale 3 1,375 - -
Goodwill 4 1,210 - 1,210
2,585 - 1,210
--------------- ------------------- -------------------
Current assets
Trade and other receivables 71 510 236
Cash and cash equivalents 1,876 - 567
1,947 510 803
--------------- ------------------- -------------------
Total assets 4,532 510 2,013
=============== =================== ===================
Liabilities
Non-current liabilities
Convertible loan notes 5 399 - -
Equity option on convertible loan 5 386 - -
785 - -
--------------- ------------------- -------------------
Current liabilities
Trade and other payables 511 11 244
511 11 244
--------------- ------------------- -------------------
Total liabilities 1,296 11 244
Net assets 3,236 499 1,769
=============== =================== ===================
Equity
Share capital 7 912 155 155
Share premium account 62,353 52,533 52533
Other reserves (59,288) (52,178) (51,748)
Equity, purchase of own shares 2 (215) - -
Share-based payment reserves 134 - 25
Accumulated deficit (1,599) (11) (280)
--------------- ------------------- -------------------
Equity attributable to owners of the company 2,297 499 685
Non-controlling interest 939 - 1,084
Total equity 3,236 499 1,769
=============== =================== ===================
*In accordance with note 3, and the adoption of reverse takeover accounting principles, comparatives
are for SalvaRx Limited
SalvaRx Group
Consolidated statement of
cash flows
For the six months ended 30
June 2016
Note Unaudited Unaudited Unaudited
six months ended 30 June 2016 *6 May 2015 to 30 *6 May 2015 to 31
June 2015 December 2015
GBP'000 GBP'000 GBP'000
Loss before tax (1,464) (11) (390)
Adjustments for:
Share-based payments 108 - 25
Finance cost 25 - -
Exceptional item 563 - -
Operating cash flows before movements
in working capital (768) (11) (365)
(Increase)/decrease in receivable 165 (510) (237)
(Increase)/decrease in payables (37) 11 229
--------------------- ------------------- ---------------------
Cash used in operations (640) (510) (373)
Taxation paid - - -
Net cash outflow from operating
activities (640) (510) (373)
--------------------- ------------------- ---------------------
Investing activities
Investment in Intensity Therapeutics (1,375) - -
Inc.
Net cash used in investing activities (1,375) - -
--------------------- ------------------- ---------------------
Financing activities
Proceeds from the issue of share
capital - 510 940
Cash acquired through reverse 2,564 - -
acquisition
Proceeds on issue of convertible loan 760 - -
notes
Net cash from financing activities 3,324 510 940
--------------------- ------------------- ---------------------
Net increase in cash and cash
equivalents 1,309 - 567
Cash and cash equivalents at 567 - -
beginning of period
Cash and cash equivalents at end of
period 1,876 - 567
===================== =================== =====================
*In accordance with note 3, and the adoption of reverse takeover accounting principles, comparatives are for SalvaRx Limited.
SalvaRx Group plc
Consolidated statement of changes in equity
As at 30 June 2016
Attributable to the owners of the company
Share Share Other Purchase Share-based Accumulated Equity Non-controlling Total
Capital premium reserves of own payments deficit attributable interest equity
shares reserves to
owners GBP'000
GBP'000 GBP'000 GBP'000
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 6 May 2015 155 52,533 (52,688) - - - - - -
Issue of equity
shares at
subsidiary - - 510 - - - 510 - 510
Net loss for
the period - - - - - (11) (11) - (11)
-------- -------- ---------- --------- ------------ ------------ ------------- ---------------- ---------
At 30 June
2015 155 52,533 (52,178) - - (11) 499 - 499
Issue of equity
shares at
subsidiary - - 430 - - - 430 430
Acquisition
of IOX - - - - - - - 1,200 1,200
Share based
payments - - - - 25 - 25 - 25
Pre-acquisition
loss - - - - - - - (5) (5)
Net loss for
the period - - - - - (269) (269) (111) (380)
-------- -------- ---------- --------- ------------ ------------ ------------- ---------------- ---------
At 31 December
2015 155 52,533 (51,748) - 25 (280) 685 1,084 1,769
Issue of equity
by parents 757 9,820 (7,540) (215) - - 2,822 - 2,822
Share based
payments - - - - 109 - 109 - 109
Net loss for
the period - - - - - (1,319) (1,319) (145) (1,464)
At 30 June
2016 912 62,353 (59,288) (215) 134 (1,599) 2,297 939 3,236
======== ======== ========== ========= ============ ============ ============= ================ =========
SalvaRx Group plc
Notes to the interim financial statements for the six months ended 30 June 2016
1 General information
SalvaRx Group plc (the 'Company' and, together with its subsidiaries, the 'Group') is incorporated in the Isle of Man, British Isles under the Isle of Man Companies Act 2006. The address of the registered office is Commerce House, 1 Bowring Road, Ramsey, Isle of Man, British Isles, IM8 2LQ.
On 22 March 2016, the Company acquired the 88.9% of the share capital of SalvaRx Limited not already owned by it for a consideration of GBP8.8m satisfied by the issue of 24,788,732 New Ordinary Shares. The Acquisition was of sufficient size to constitute a reverse takeover under the AIM Rules and is accounted for as a reverse acquisition in these financial statements (Note 3). As a result, SalvaRx Limited is an accounting acquirer and comparative figures provided in these financial statements are those of SalvaRx Limited.
Prior to the above, the name of the Company was changed to SalvaRx Group plc, the shares were consolidated on the basis of 1 New Ordinary Share for every 100 Ordinary Shares, and there was a placing of 5,492,958 New Ordinary Shares at a price of 35.5p per share to raise GBP1.95m before expenses.
The principal activity of the Group is drug development, pre-clinical development with particular focus on developing series of compounds for cancer immunotherapy.
Basis of preparation
The consolidated interim financial information has been prepared using policies based on International Financial Reporting Standards ('IFRSs') as issued by the International Accounting Standards Board (the 'IASB') and as adopted by the European Union (the 'EU'). These policies and practices are consistent with those adopted in the Group's financial statements for the year ended 31 December 2015 except for the following new policies which have been adopted due to change in the business activities of the Group and will be adopted in the Group's financial statements for the year ending 31 December 2016.
The consolidated interim financial statements have not been audited, and have not been prepared in compliance with International Accounting Standard ('IAS') 34, 'Interim Financial Reporting'. In the opinion of the Directors, the consolidated interim financial information for the period represents fairly the financial position, results from operation and cash flows for the period in conformity with generally accepted accounting principles consistently applied.
These consolidated interim financial statements include the accounts of the Company and:
i. SalvaRx Limited, ("SalvaRx) incorporated on 6 May 2015 in the British Virgin Islands.
ii IOX Therapeutics Limited ("IOX") incorporated in the U.K. as a private company (Company Number 9430782) under the Companies Act 2006 on 10 February, 2015. SalvaRx Limited acquired 60.49% equity in IOX on 1 July, 2015.
The Group's interim financial statements are presented in pounds sterling, which is the Group's functional and presentational currency, and all values are rounded to the nearest thousands (GBP000) except loss per ordinary share and figures and numbers in the Notes.
New accounting policies adopted for the year ending 31 December 2016:
Research and Development Expenses
(i) Research and development
Expenditure on research activities, undertaken with the prospect of gaining new scientific or technical knowledge and understanding, is recognized in profit or loss as incurred.
Development activities involve a plan or design for the production of new or substantially improved products and processes. Development expenditures are capitalized only if development costs can be measured reliably, the product or process is technically and commercially feasible, future economic benefits are probable, and the Company intends to and has sufficient resources to complete development and to use or sell the asset. No development costs have been capitalized to date.
Research and development expenses include all direct and indirect operating expenses supporting the products in development
(ii) Subsequent expenditure
Subsequent expenditure is capitalized only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditures are recognized in profit or loss as incurred.
(iii) Clinical trial expenses
Clinical trial expenses are a component of the Company's research and development costs. These expenses include fees paid to contract research organizations, clinical sites, and other organizations who conduct development activities on the Company's behalf. The amount of clinical trial expenses recognized in a period related to clinical agreements are based on estimates of the work performed using an accrual basis of accounting. These estimates incorporate factors such as patient enrolment, services provided, contractual terms, and prior experience with similar contracts.
Goodwill
Goodwill is tested annually for impairment and carried at cost less accumulated impairment losses which are not reversed. Goodwill is allocated to the cash generating unit expected to benefit from the business combination in which the goodwill arose, for the purpose of impairment testing.
Business Combinations
The Company applies the acquisition method to account for all acquired businesses, whereby the identifiable assets acquired and the liabilities assumed are measured at their acquisition-date fair values (with few exceptions as required by IFRS 3 Business Combinations).
The consideration transferred in a business combination is measured at fair value, which is calculated as the sum of the acquisition-date fair values of the assets transferred, the liabilities incurred and the equity interests issued by the Company.
Acquisition-related costs (e.g. finder's fees, consulting fees, administrative costs, etc.) are recognized as expenses in the periods in which the costs are incurred and the services are received.
On acquisition date, goodwill is measured as the excess of the aggregate of consideration transferred, any non-controlling interests in the acquiree, and acquisition-date fair value of the Company's previously held equity interest in the acquiree (if business combination achieved in stages) over the net of the acquisition-date amounts of the identifiable assets acquired and the liabilities assumed.
If, after appropriate reassessment, the amount as calculated above is negative, it is recognized immediately in profit or loss as a bargain purchase gain.
At acquisition date, non-controlling interests in the acquiree that are present ownership interests and entitle their holders to a proportionate share of the entity's net assets in the event of liquidation are measured at either fair value or the present ownership instruments' proportionate share in the recognized amounts of the acquiree's identifiable net assets. This choice of measurement is made separately for each business combination. Other components of non-controlling interests are measured at their acquisition-date fair values, unless otherwise required by IFRS.
The acquisition-date fair value of any contingent consideration is recognized as part of the consideration transferred by the Company in exchange for the acquiree. Changes in the fair value of contingent consideration that result from additional information obtained during the measurement period (maximum one year from the acquisition date) about facts and circumstances that existed at the acquisition date are adjusted retrospectively against goodwill.
Going concern
As part of their going concern review the Directors have followed the guidelines published by the Financial Reporting Council entitled "Guidance on Risk Management and Internal Control and Related Financial and Business Reporting".
The Group incurred a net loss of approximately GBP1.5m during the period and as at 30 June 2016 had cash and cash equivalent of approximately GBP1.9m; The Board has evaluated the cash flow and proposed budget and has reached the conclusion there is sufficient funding for the current workload projected until September 2017. This budget includes some estimation of the R&D tax credits that are available to the Group. There is some minor risk to the timing and total amount of this cash flow, but the Board has considered the availability of future funding and that existing shareholders / directors have indicated their intention to provide the further funding should this be required. That being said, major costs of drug development going forward are covered by external non-dilutive funding (collaborative research agreements and grants).
The Group believes that these available resources will be sufficient to meet its cash requirements
through to the clinical trial, expected to be in 2017 for its operational and research and
development activities.
As the Group continues to incur losses, transition to profitability is dependent upon achieving a level
of revenues adequate to support the Group's cost structure and unless and until doing so, intends to
fund future operations through additional debt or equity offerings. There can be no assurance, however, that additional funding will be available on terms acceptable to the Group, if at all.
2 Reverse acquisition transaction
On 30 September 2015, the Company acquired 11.14% of the issued share capital of SalvaRx Limited ("SalvaRx"), a private company incorporated in the British Virgin Islands. SalvaRx holds 60.49% of IOX Therapeutics Limited ("IOX"), a company incorporated in England and Wales.
On 22 March 2016, the Company acquired the remaining issued share capital of SalvaRx by issuing 24,788,732 ordinary shares of the Company.
Although the transaction resulted in SalvaRx becoming a wholly owned subsidiary of the Company, the transaction constitutes a reverse acquisition in as much as the shareholders of SalvaRx own a substantial majority of the outstanding ordinary shares of the Company and four out of six members of the Board of Directors of the Company are SalvaRx shareholders and management.
In substance, the shareholders of SalvaRx acquired a controlling interest in the Company and the transaction has therefore been accounted for as a reverse acquisition in accordance with guidance provided in IFRS 2 Share-based payment and IFRS 3 Business Combinations. As the Company previously discontinued its investment activities and was engaged in acquiring SalvaRx and raising equity financing to provide the required funding for the operations of the proposed acquisition and re-listing on AIM, it did not meet the definition of a business according to the definition in IFRS 3. Accordingly, this reverse acquisition does not constitute a business combination; rather it is treated as an issuance of shares by SalvaRx for the fair value of the net assets of the Company followed by a recapitalization of the Company.
In accordance with reverse transaction accounting principles, these consolidated financial statements represent a continuation of the financial statements of SalvaRx and include:
a. The assets and liabilities of SalvaRx and IOX at their pre-acquisition carrying amounts as at 30 June 2016 and expenses for the six months ended on that date
b. The assets and liabilities of the Company as at 30 June 2016 and expenses from 23 March 2016 to 30 June 2016.
c. Share capital representing the total number of shares issued by the Company and its share premium account balance associated with the share capital.
d. Comparative figures are those of SalvaRx and IOX on a consolidated basis, before the transaction and share capital and share premium balances of the Company.
The fair value of net assets of the Company acquired by SalvaRx was as follows:
Based on an assessment of the purchase consideration for an 88.9% holding in SalvaRx of GBP8.8m, the deemed cost of the acquisition of the Company by SalvaRx is GBP2,832,000. The difference between this deemed cost and the fair value of the net assets acquired of GBP563,000 has been expensed in accordance with IFRS2. Share based payments, reflecting the economic cost to the SalvaRx shareholders of acquiring a quoted entity. Given its significance, this cost has been treated as an exceptional item.
3. Investment Available for Sale
On 22 April, 2016, the Company acquired 1m Series A preferred stock in Intensity Therapeutics Inc.., a Delaware corporation ("Intensity") for US$2m (GBP1.4m) in cash. All Series A Preferred stock is convertible into equal number of common shares in Intensity. The Company's holdings represent less than 10% of the equity of Intensity. The Company has determined that it has no significant control or influence over the affairs of Intensity and has therefore accounted for this investment at fair value as an available for sale financial instrument, which at 30 June, 2016 was considered equal to its carrying value. Intensity is planning Phase 1 study of its lead product, which enhances the penetration of cancer drugs into cancer cells while avoiding the normal cells, allowing for local delivery into the tumour, potentially sparing cancer patients the debilitating side-effects of systemically administered treatments.
As at 30 June, 2016, the Company has determined that there was no evidence of any impairment in the value of this investment and as a result no adjustment was considered necessary in its carrying value.
4. Goodwill
On 1 July 2015, SalvaRx acquired 15,313 new Seed Preferred Shares in IOX at a price of GBP120 per
Seed Preferred Share, which represents 60.49 %. equity in IOX for GBP1,837,560.
Except for a preference over Ordinary Shares on winding up, Seed Preferred Shares have the same voting rights as Ordinary Shares and are convertible into equal number of ordinary shares.
SalvaRx has a majority equity interest and also has significant control over the management of IOX. As a result, these financial statements include results of operations for IOX from 1 July 2015 to 31 December 2015 and for six months ended 30 June 2016 and assets and liabilities as at 31 December 2015 and as at 30 June 2016.
The non-controlling interests in IOX on the date of acquisition was valued at GBP1.2 million, based on their 39.51 per cent. equity being valued on the basis of the price SalvaRx paid for 60.49 per cent. equity in IOX. As at 1 July 2015, net assets acquired were determined as per IFRS 3 - business combinations, as follows:
GBP GBP
Goodwill 1,209,974
Other net assets
Liability assumed (10,074)
Assets assumed * 1,837,660
1,827,586
Net assets acquired 3,037,560
Allocated to
Cash consideration paid for company's interest 1,837,560
Non-controlling interest (39.51%) ** 1,200,000
3,037,560
* Consideration was paid for new Seed Preferred Shares in IOX. As SalvaRx has control over IOX and the consideration paid by
SalvaRx will remain within the Group, the net cash impact of the acquisition on the Group is GBPnil.
** Non-controlling interest has been valued based on 39.51 per cent. of the grossed up consideration paid by SalvaRx ((GBP1,827,586 /
60.49 per cent.) x 39.51 per cent.)
The Group assesses the recoverability of the carrying value of goodwill on an annual basis and whenever events occur or when circumstances change that would, more likely than not, indicate that the fair value of the reporting unit (IOX) is below its carrying value.
For the purpose of impairment testing, goodwill is attributable to IOX, which is considered a cash
generating unit (CPU).
For the goodwill impairment analysis performed at 30 June 2016, the Directors performed a
qualitative assessment to determine whether it was more likely than not that the goodwill asset was
impaired in order to determine the necessity of performing a quantitative impairment test, under
which management would calculate the asset's fair value. When performing the qualitative assessment, the Directors evaluate events and circumstances that would affect the significant inputs used to determine the fair value of the goodwill. Events and circumstances evaluated include: macroeconomic conditions that could affect CPU and the Group, industry and market considerations for the pharmaceutical industry that could affect CPU and the Group, cost factors that could affect CPU and the Group's performance, its existing agreement for clinical testing and its financial requirements, and consideration of any company specific events that could negatively affect it, its business, or its fair value. Further, in April 2016, a consortium of which IOX and its clinical partner are members were awarded an EUR8.3m Horizon 2020 grant to support their clinical development work.
Based on the Directors' assessment of the aforementioned factors, it was determined that it was more likely than not that the fair value of the CPU is greater than its carrying amount as of 30 June 2016, and therefore no quantitative testing for impairment was required.
5. Convertible Loan Notes
On 21 April 2016, the Company issued US$1 million of zero coupon convertible unsecured loan notes ("Loan Notes") to Jim Mellon, the Non-Executive Chairman and Greg Bailey, a Non-Executive Director ("the Noteholders"), who are both substantial shareholders in the Company. Mr Mellon and Dr Bailey subscribed for US$0.5 million of Loan Notes each. The Loan Notes have a term of three years, with a zero coupon and may be converted in whole or in part at the Noteholder's discretion at a price of 35.5p per ordinary share. The Noteholders have undertaken not to convert their Loan Notes in circumstances where (i) the conversion would result in the Concert Party's holding in the Company exceeding 74.66% on a fully diluted basis or (ii) the percentage of shares in public hands would fall below 10%.
These notes have an embedded derivative in the form of the equity conversion rights whose value will be affected by foreign exchange movements. The company has therefore determined the fair value of the derivative to be GBP386,462.
The derivative value has been deducted from the loan balance and accounted for separately on the balance sheet and will be subject to revaluation on each balance sheet date through the income statement in accordance with IAS 39.
The residual loan balance at 30 June 2016 of GBP399,000 is held at amortised cost and is subject to a notional interest at 18.40%, which for the period to 30 June 2016 was GBP25,058. The interest amount is expensed as finance cost and included within the loan balance.
6. Loss per Ordinary Share
Basic loss per Ordinary Share from continuing operations is calculated by dividing the net loss for the period attributable to Ordinary equity holders of the parent by the weighted average number of Ordinary Shares outstanding during the period. The weighted average number of Ordinary Shares outstanding during the period and for the prior periods presented has been adjusted in accordance with IAS 33 Earnings per share.
The calculation of the basic and diluted loss per share is based on the following data:
Unaudited Unaudited Unaudited
six months 6 May 2015 6 May 2015
ended to to
30 June 30 June 31 December
2016 2015 2015
GBP'000 GBP'000 GBP'000
Loss
Loss for the purposes of basic loss
per share from continuing operations
being net loss attributable to equity
holders of the parent (1,294) (11) (390)
Number of shares
Weighted average number of Ordinary
Shares for the purposes of basic
profit/(loss) per share 26,372,722 10,840,680* 20,524,876*
Loss per Ordinary Share GBP GBP GBP
From continuing operations
Basic and diluted (0.05p) (0.00p) (0.01p)
* Average number of SalvaRx shares for the period multiplied by 433.63, being the number of shares of the Company issued for each SalvaRx share on acquisition
The weighted average number of shares for the purpose of calculating the basic and diluted measures is the same. This is because the outstanding share options would have the effect of reducing the loss per ordinary share and therefore would be anti-dilutive under IAS 33 Earnings per Share.
7. Share capital
Unaudited Unaudited Unaudited
30 June 2016 30 June 2015 31 December
* 205*
Number GBP'000 Number GBP'000 Number GBP'000
in 000 in 000 in 000
Authorised
Ordinary
Shares of
2.5p each 80,000 2,000 10,400 260 10,400 260
============ ================ ============== ================ ================= ================
Issued and
fully paid
Ordinary
Shares of
2.5p each 36,467 912 6,185 155 6,185 155
============ ================ ============== ================ ================= ================
* Number of shares and par value of share adjusted for the consolidation on the basis of 1 New Ordinary Share for every 100 Ordinary Shares.
The Company has one class of Ordinary Shares, which carry no right to fixed income.
The Company has 3,225,941 options issued and outstanding as at 30 June 2016 of which 2,508,777 options have not yet vested. These options expire between February 2018 and March 2021 and are convertible into equal number of Ordinary shares of the Company at an exercise prices ranging from 23.2p to 71p per share.
IOX has 675 options issued and outstanding as at 30 June 2016 of which 506 options have not yet vested. These options expire in 2020 and are convertible into equal number of Common shares of IOX at an exercise price of GBP84.23 per share.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR SFIFWEFMSEDU
(END) Dow Jones Newswires
September 13, 2016 02:00 ET (06:00 GMT)
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