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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Science In Sport Plc | LSE:SIS | London | Ordinary Share | GB00BBPV5329 | ORD 10P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 15.75 | 15.50 | 16.00 | 15.75 | 15.75 | 15.75 | 111,056 | 08:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Health & Allied Services,nec | 63.77M | -10.91M | -0.0640 | -2.46 | 26.83M |
From Apr 2019 to Apr 2024
TIDMSIS
RNS Number : 3493I
Science in Sport PLC
21 March 2018
21 March 2017
SCIENCE IN SPORT PLC
("SiS" or the "Company")
FINAL RESULTS
FOR THE YEARED 31 DECEMBER 2017
Science in Sport plc (AIM: SIS), a leading sports nutrition company that develops, manufactures and markets sports nutrition products for professional athletes and sports enthusiasts, is pleased to announce its audited final results for the year ended 31 December 2017.
Financial Highlights
-- Revenues increased by 28% to GBP15.62 million (2016: GBP12.24 million) significantly ahead of market growth forecast for the sports nutrition sector, with particularly strong growth in online channels and international markets;
-- New product development continued to be a key growth driver, and delivered GBP0.9m of sales in the year (2016: GBP0.8m) contributing 27% to overall revenue growth;
-- Gross profit increased to GBP9.32m (2016: GBP7.38m) reflecting continuing factory efficiencies which have maintained gross margin close to 60%;
-- Underlying operating loss* of GBP1.70m (2016: GBP0.80m) in line with growth strategy and expectations, reflecting continued investment in brand awareness, e-commerce and international expansion. Core UK business delivered operating profit of GBP0.6m;
-- Cash and cash equivalents of GBP16.57m (2016: GBP6.13m) reflect funds raised in December 2017.
* excludes depreciation and amortisation and non-cash share based payments
Operational Highlights
-- Consistent investment in the Science in Sport brand resulted in record levels of brand awareness and usage;
-- 55% of revenue was derived from online channels (2016: 49%), exceeding the 50% target set for 2017;
-- Continued investment in the Science in Sport e-commerce platform:
o Delivered 58% year on year growth, contributing 30% of revenues
-- Revenue from International customers grew 60% across both Core and International segments, and 28% (2016: 22%) of total Group revenue was derived from these customers;
-- Innovation and new product development including;
o Rego Rapid Recovery Plus developed with Team Sky
o Further extension of the Whey 20 portfolio
o Strong launch pipeline for 2018;
-- Continued efficiency improvements in factory underpinned margin; -- Best in world banned substance testing regime introduced January 2017;
-- New brand partnerships including British Cycling, USA Triathlon, Rock'n'Roll Marathon, Cycling Australia and Celtic FC. In January 2018, the Company signed a 3 year exclusive strategic partnership with Manchester United Football Club.
Stephen Moon, Science in Sport's CEO, said: "This was another period of very strong growth, the fifth consecutive year where SiS has significantly outstripped this sector. We saw outperformance in all online channels and international markets. Our strategy of consistent investment in brand equity, our e-commerce platform and product innovation underpinned this success. Continuing improvements in factory and supply chain efficiencies underpinned a very robust gross margin. Our core business in the UK and EU was profitable at EBITDA level and we commenced our investment in the strategic markets of the USA and Italy.
We are looking forward to another year of strong revenue growth in 2018. We expect gross margin to be consistent, given further factory efficiencies and favourable raw material prices. Our innovation pipeline for 2018 and beyond is very healthy and will continue to be a key driver of progress. We are investing substantially to develop our businesses in the USA and Italy and in addition we have launched our new Football business, underpinned by our recently announced exclusive nutrition partnership with Manchester United."
For further information:
Science in Sport plc +44 (0) 20 7400 3700 Stephen Moon, CEO Elizabeth Lake, FD Cenkos Securities NOMAD and Broker +44 (0) 20 7397 8900 Bobbie Hilliam - NOMAD Nick Searle - Sales
About Science in Sport plc
Science in Sport plc is a leading sports nutrition company that develops, manufactures and markets sports nutrition products for professional athletes and sports enthusiasts. SiS is a strong brand in the elite athlete community - in the 2016 Rio Olympics, 34 medal-winning athletes or teams used SiS products (compared with 24 in 2012).
The SiS core product ranges include: SiS GO, comprising energy powders, isotonic gels, energy bars and shots; SiS REGO, including protein-based recovery powders; SiS Protein, products specifically designed to contribute to athletes' lean muscle mass growth and maintenance; SiS Supplements, comprising BCAA Perform, Creatine, Beta Alanine and L Glutamine; SiS Athlete Health, vitamins and supplements range designed to support and maintain immune function, digestive health and bone health. SiS products are sold in a range of retail channels, including specialist sport retailers, major grocers, high street retailers and e-commerce websites.
SiS is currently the official sports nutrition partner to professional cycling organisations Team SKY, British Cycling, Cycling Australia and USA Cycling. SiS is also a partner to British Triathlon & USA Triathlon. Along with supplying over 40 professional English & Scottish League football teams, SiS is Sports Nutrition Partner to the world's most popular football club, Manchester United FC. In addition, Olympians Sir Chris Hoy MBE, and Mark Cavendish MBE are Brand Ambassadors.
SiS was founded in 1992 and is headquartered in Hatton Garden, London. Its manufacturing facility is in Nelson, Lancashire.
SiS shares are traded on the AIM market of the London Stock Exchange under the ticker symbol SIS.
For further information, please visit www.scienceinsport.com
CHAIRMAN'S AND CEO'S JOINT REVIEW
Overview and Strategy
We are delighted to announce a strong set of results for the year ended 31 December 2017. Revenue of GBP15.6m for the year was 28% ahead of the same period in 2016 and saw the Company deliver a fifth consecutive year of strong revenue growth. This was well ahead of the 8% CAGR forecast by Euromonitor for 2017 for the sports nutrition sector in the UK.
The Company's growth strategy is predicated on consistent investment in science and innovation, developing brand awareness, building e-commerce capability and reach through its scienceinsport.com e-commerce platform and developing new International markets. In our core UK market, we remain committed to a multi-channel distribution strategy in all Online and Retail channels. We underpin growth by seeking to maintain and improve gross margin, while controlling overhead growth, to benefit from operational gearing.
The Board believes there continue to be significant opportunities for the Company over the next few years and in order to maximise this SiS raised GBP14.8 million before costs in December 2017 to fund growth in key strategic International markets, as well as a move into a new sport, Football. In January 2018 we were pleased to announce our partnership with Manchester United Football Club, which includes access to players and followers of the world's most popular football club. The Company will continue to invest in the development of its e-commerce business, including a dedicated site to support our Football strategy. If appropriate, we will consider acquisitions to complement our existing product range and to deliver synergies from our distribution, e-commerce and supply chain capabilities.
Brand and Range
Our brand strategy is to consistently invest in building equity in the SiS brand, which is widely recognised by professional and elite athletes. SiS is a leader in science and innovation, supported by world-class in-house expertise, together with a range of collaborations with academic institutes, elite athletes and sports teams.
The Science in Sport brand is trusted by professional and Olympic athletes in a range of sports, across the world. A key component of this trust is our approach to preventing banned substances entering its supply chain and finished products. In line with this, Science in Sport is the only brand globally to hold both Informed Sport Site Certification and Informed Sport Product Certification. Each year an internal review of the banned substance prevention regime takes place within the Company, and from January 2018 an upgraded system was implemented to continually improve and evolve the controls and systems within the Company. The Company regime is built on the following pillars:
- Every single batch of Science in Sport finished product which leaves the Company's factory is screened against the 2018 World Anti-Doping Agency (WADA) list. Banned substances including steroids are tested to the level of 10 Nanograms per gram, and stimulants to 100 Nanograms per gram.
- Batches (sampled at the beginning, during and end of each product batch) receive the recognised and respected Informed Sport certificate. Finished product testing is the final and most effective step that we have to ensure product assurance.
- Raw material batch testing, in addition to testing on finished goods, for any product deemed 'high-risk'
- Full trace management of all raw materials from raw material base and manufacturing supplier, through to finished goods manufactured per production batch. This allows the Company to demonstrate to athletes the source of ingredients and all parties involved in the manufacturing process.
- Rigorous screening of all ingredient suppliers, including annual auditing. All suppliers are required to be certified to a recognised Quality Management system that is approved by The Global Food Safety Initiative.
- In house product screening within the Company's production facility in Nelson, Lancashire, including swab testing for banned substances and conducting surprise third-party inspections throughout the year
SiS is a trusted brand which is used widely by enthusiasts and elite athletes in a growing range of endurance sports. These customers include cyclists, triathletes, rowers, tennis players and runners. More recently the brand has started to extend into new sports including professional football at the highest level and international rugby.
SiS products are endorsed by the Company's Brand Ambassadors, including Sir Chris Hoy MBE and Mark Cavendish MBE. SIS is an official nutrition supplier to professional cycling teams Team Sky along with national associations British Cycling, Cycling Australia, USA Cycling, USA Triathlon and British Triathlon. The Company works closely with its Ambassadors and partners on product innovation. SIS also benefits from a close relationship with organisations and training centres focused on athlete development, including the English Institute of Sport.
SiS products are designed to sustain performance, to aid recovery and to build lean muscle. The core product range fuels five key athlete needs groups:
Energy - Bars, shots, gels and powders to give athletes energy
Hydration - Gels, tablets and powders to keep athletes energised and hydrated
Recovery - Powder range to aid athlete's recovery post-exercise
Rebuild - Powders, gels and bars to build and maintain lean muscle mass
Athlete Health - Vitamins and supplements range designed to support and maintain immune function, digestive health and bone health amongst athletes.
Overview of the financial year
The year ended 31 December 2017 saw sales up 28% at GBP15.6 million (2016: GBP12.2 million). E-commerce sales, both from our own website and Third-party Online retailers were particularly strong, reflecting the continued investment in brand awareness and e-commerce technology and management. Our International channels also grew significantly over the period under review. We believe that in our marketplace of endurance sport nutrition we delivered sector leading revenue growth, both organic growth and by taking market share from key competitors.
The underlying operating loss was in line with management expectations at GBP1.7 million (2016: GBP0.8 million) and this reflected continued investment in marketing, sales and e-commerce of GBP8.0 million (2016: GBP5.9 million).
Overheads excluding sales and marketing were GBP3.0 million (2016: GBP2.2 million) for the year. Within this amount is GBP0.5 million spend on Testing and Projects (2016 GBP0.1 million) and a foreign exchange loss on the revaluation of subsidiary loans of GBP0.1 million (2016: GBP0.1 million gain).
Depreciation and amortisation costs of GBP0.6 million (2016: GBP0.4 million), non-cash share-based payments related to short and long-term management incentive schemes of GBP1.6 million (2016: GBP1.6 million), resulted in a pre-tax loss of GBP3.9 million (2016: pre-tax loss GBP2.8 million).
Net cash and cash equivalents at the year-end were GBP16.6 million (31 December 2016: GBP6.1 million). The increase in cash is due to an equity fundraise completed in December 2017 which raised GBP14.8 million before costs.
Non-cash share-based payments amounting to GBP1.6 million (2016: GBP1.6 million), which have been excluded from underlying operating loss, continue to reflect the grant of options to employees under the Company Long Term Incentive Plan ("LTIP") and the Short Term Incentive Plan ("STIP").
Sales Channels
The Company's sales channels comprise our own E-commerce platform, Third-Party Online retailers, Heartland of independent sports retailers, major Grocers, High Street Chains and International sales distributors.
Our E-commerce platform was a focus again during 2017 and delivered 58% growth, as we continued to invest in developing our consumer database and driving stronger conversion and improved loyalty. Third-Party Online retailers, led by Wiggle, Chain Reaction and Amazon also delivered another year of outstanding growth, as we continued to invest in this channel. Overall 55% of revenue was derived from online channels, being both the Company's own E-commerce platform and Third-Party Online retailers, and we expect this growth to continue in 2018.
We have continued to work closely with the leading five major Grocery chains during what has been a challenging year for grocers. Like-for-like growth of 8% was in line with the category. High Street revenue grew 11% in 2017 after a decline in 2016, with the sales growth being driven by one of the leading sports retailers. The Heartland of independent cycle and running shops also saw growth in a challenging market, with sales growing 5% and we remain committed to our distribution in this important and opinion leading channel.
International sales, defined as sales to an end consumer outside of the UK through any channel, grew 60% and some 28% of total revenues came from existing and new overseas markets. Sales in the US were GBP0.4m against GBP0.1m in 2016, and in Italy sales grew over 100% from GBP0.3m to GBP0.6m. We are investing in these markets and expect to see accelerated growth as set out in our equity fundraise announcement released on 14 November 2017. Sales in Australia grew by 28% from GBP0.5m to GBP0.7m, significantly outgrowing the market in this geography. In addition, our strategic Heartland distributor Shimano performed exceptionally well again across all geographies in Europe.
Product Innovation
Trust, quality and innovation are the key qualities for which SiS is recognised and we continue to invest in this strategically important area. Once again, innovation has been a key driver of growth, with 6% of sales and 27% of total revenue growth coming from new products, continuing the trend of the previous three years.
Key highlights during the financial year were;
o Rego Rapid Recovery Plus developed with Team Sky
o Further extension of the Whey 20 portfolio
o Strong launch pipeline for 2018;
Renowned for our innovation and product development in conjunction with elite athlete insight, we have worked with Team Sky and developed and launched Rego Rapid Recovery Plus. This is an enhanced version of Rego with more carbohydrate and whey protein which is absorbed faster than soy protein, and was launched exclusively on our website. The introduction of two new flavours extending our novel WHEY20 range of ready to consume protein in 2017 has broadened the appeal of our patented product, ahead of sustained activity planned for 2018. In a study completed by Northumbria University, WHEY20 was proven to significantly reduce the loss of important muscle proteins, attenuated muscle stiffness and result in faster recovery of muscle strength. These findings clearly demonstrate WHEY20 improves muscle recovery and have been published in the journal of Applied Nutrition, Physiology and Metabolism.
In line with our strategy we continuously invest in science and new product development and innovation and as a result, the pipeline for new products in 2018 is very strong. We are also investing in major new technologies for future product development.
Supply chain
Gross margin at our Nelson, Lancashire manufacturing facility was 59.7%, a slight decrease from the previous period which reflects the increase in International business and the associated costs of shipping and duties. The factory has continued to achieve record efficiencies in production and picking and packing. There has been benign raw material pricing at the start of 2018.
As highlighted earlier within Brand and Range from January 2018 an upgraded system of banned substance testing has been implemented.
The low-cost base of the Nelson site, together with the controls afforded in the banned substance testing programme, continue to provide a strategic advantage for the Company.
People
The Company has continued to invest in its employees. Key highlights within the organisation for the financial year have been as follows;
o Decentralised commercial teams are now in place in key strategic international markets, being the US and Italy. The Company has also put in place a standalone commercial team focused on the Football market.
o High quality individuals have been recruited in e-commerce and customer service teams to support high growth in both core and new International markets and to enhance levels of customer service.
o Continued investment in, and development of key staff
We continued to further strengthen e-commerce and customer service teams in 2017 to support high growth in both core and new International markets and to enhance our level of customer service.
The Board wishes to thank all the team in London and Nelson and the strategic International markets for their professionalism, enthusiasm and dedication in delivering another sector leading performance for the Company.
Outlook
We are seeking to achieve further strong revenue growth in 2018 and the year has started well for us. International growth, Football and e-commerce are our key strategic focus, with brand investment and science and innovation underpinning growth.
We continue to invest heavily in brand awareness in all markets, as well as aggressively building our e-commerce consumer database and seeking to improve conversion and loyalty.
Continued investment in the website will see further enhanced functionality launching in the first quarter, this will improve our e-commerce metrics and drive further growth
We look forward to 2018 with optimism as we continue to build SiS to become the global leader in the endurance sports nutrition market.
John Clarke Stephen Moon
Chairman CEO
FINANCIAL REVIEW
Revenue
The Company has continued to grow strongly during the year ended 31 December 2017, with sales up 28% at GBP15.62 million (2016: GBP12.24 million). Revenue growth has been achieved through a particularly strong performance across the e-commerce, third-party online retailers and international channels and reflects the continued investment in the business across all channels. The investment in, and focus on, online sales has resulted in 55% of business revenues being derived from e-commerce sales across our own platform and third parties.
Our International growth strategy has delivered significant growth with 28% of revenues now coming from International customers (2016: 22%)
In 2017, the Company also continued to invest in product innovation and launched a number of new products.
Gross margin
The Company generated a gross profit of GBP9.32 million (2016: GBP7.38 million) with the gross margin achieving a percentage of revenue of 59.7% (2016: 60.3%). The factory has delivered further efficiencies which have covered the increase in cost of raw materials, however the margin overall is slightly lower due to the impact of selling more through our overseas subsidiaries, increasing the shipping and duty costs.
Underlying operating loss
The underlying operating loss of GBP1.70 million (2016: GBP0.8 million) reflects the ongoing investment in sales and marketing to drive revenue growth, together with ex plan investment in the e-commerce teams to drive revenue growth in overseas markets and the UK market. Operating loss is in line with management expectations.
The Group's cost base and its resources have been, and will continue to be, tightly managed within budgets approved and monitored by the Board. If a growth opportunity is identified then ex-plan investment will be approved.
The Group has chosen to report underlying operating loss as the Directors believe that the operating loss before depreciation, amortisation, non-cash share based payments and exceptional items provides additional useful information for shareholders on underlying trends and performance. This measure is used for internal performance analysis. A reconciliation of underlying operating loss to loss from operations is presented on the face of the consolidated statement of comprehensive income.
Share based payments
The Company operates both a Short Term Incentive Programme ("STIP") and a Long Term Incentive Programme ("LTIP"). Together the Share Option Plan ("SOP") was approved by the Remuneration Committee in June 2014 in line with the proposal contained in the Company's AIM Admission document in August 2013. A new LTIP was approved by the Remuneration Committee in September 2016, following the completion of the previous three year LTIP at the end of 2015.
Accordingly, the Company has recognised a share based payment charge totalling GBP1.58 million in the year ended 31 December 2017 (2016: GBP1.57 million).
The Company intends to put in place a new incentive scheme following the equity raise in December 2017 and will update shareholders on this matter in due course.
Taxation
The current tax charge is GBPNil (2016: GBPNil) due to the loss made in the year. The deferred tax credit of GBP0.25 million (2016: GBP0.15 million) is primarily due to the recognition of a deferred tax asset in respect of taxable losses created in the year.
Losses and dividends
The loss attributable to equity holders of the parent for the year ended 31 December 2017 was GBP3.61 million (2016: GBP2.64 million) and the basic and diluted loss per share was 7.7p (2016: 6.2p). The Directors are not recommending the payment of a dividend (2016: GBPNil).
Capital structure and funding
On 4th December 2017 the Company raised GBP14.8 million before costs by the issue and allotment of 21,211,365 Ordinary Shares at a placing price of 70 pence per share. The placing was undertaken with new and existing institutional shareholders and was oversubscribed. The placing has enabled the Company to fund the working capital required to underpin further revenue growth and also to expand further in the US and Italian markets, as well as launch in Football as a new source of athletes.
The latest placing introduced a number of new and significant institutional investors onto the shareholder register of the Company. The Directors believe establishing a broader institutional shareholder base is in the long term interests of the Company.
Going concern
The Company made a loss after tax for the year attributable to owners of the parent of GBP3.61 million (2016: GBP2.64 million) and expects to make a further loss in the year ending 31 December 2018.
The net increase in cash and cash equivalents in the year ended 31 December 2017 was GBP10.44 million (2016: GBP2.62 million decrease). At 31 December 2017 the Company had cash balances of GBP16.57 million (2016: GBP6.13 million). As noted above, the Company raised additional cash of GBP14.02 million (net of associated costs) on 4 December 2017.
The Directors have prepared projected cash flow information for a period including 2 years from the date of approval of these financial statements.
Accordingly, the Directors have a reasonable expectation that the Company will have sufficient cash to meet all liabilities as they fall due for a period of at least 12 months from the date of approval of these financial statements. For these reasons, they continue to adopt the going concern basis of accounting in preparing the annual financial statements.
Consolidated statement of comprehensive income
Hot Features
Premium
Year Year
ended ended
31 December 31 December
2017 2016
Notes GBP000 GBP000
------------------------------------- ------ ------------ ------------
Revenue 2 15,615 12,243
Cost of goods (6,300) (4,865)
------------------------------------- ------ ------------ ------------
Gross profit 9,315 7,378
Underlying operating loss (1,704) (799)
Depreciation and amortisation (567) (419)
Share based payments charge (1,581) (1,572)
Loss from operations 3,4 (3,852) (2,790)
Finance income - 1
Finance costs - (4)
------------------------------------- ------ ------------ ------------
Loss before taxation (3,852) (2,793)
Taxation 5 246 149
Loss for the year (3,606) (2,644)
------------------------------------- ------ ------------ ------------
Other comprehensive income
Exchange differences on translation
of foreign operations 78 (50)
------------------------------------- ------ ------------ ------------
Total comprehensive loss
for the year (3,528) (2,694)
------------------------------------- ------ ------------ ------------
Loss per share to owners
of the parent
Basic and diluted - pence 6 (7.7p) (6.2p)
------------------------------------- ------ ------------ ------------
All amounts relate to continuing operations.
Consolidated statement of financial position
As at As at
31 December 31 December
2017 2016
Notes GBP000 GBP000
----------------------------------- ------ ------------ ------------
Assets
Non-current assets
Intangible assets 1,359 884
Property, plant and equipment 793 798
Deferred tax 10 1,332 1,086
----------------------------------- ------ ------------ ------------
Total non-current assets 3,484 2,768
----------------------------------- ------ ------------ ------------
Current assets
Inventories 7 2,713 2,238
Trade and other receivables 8 2,851 2,217
Cash and cash equivalents 16,570 6,130
----------------------------------- ------ ------------ ------------
Total current assets 22,134 10,585
----------------------------------- ------ ------------ ------------
Total assets 25,618 13,353
----------------------------------- ------ ------------ ------------
Liabilities
Current liabilities
Trade and other payables 9 (2,810) (2,534)
Total current liabilities (2,810) (2,534)
----------------------------------- ------ ------------ ------------
Net current assets/(liabilities) 19,324 8,051
Total net assets 22,808 10,819
----------------------------------- ------ ------------ ------------
Capital and reserves attributable
to
owners of the parent company
Share capital 6,683 4,322
Share premium reserve 22,339 10,331
Employee benefit trust reserve (397) (215)
Other reserve (907) (907)
Foreign exchange reserve 28 (50) Retained deficit (4,938) (2,662) ----------------------------------- ------ ------------ ------------ Total equity 22,808 10,819 ----------------------------------- ------ ------------ ------------
Consolidated statement of cash flows
Year Year
Ended Ended
31 December 31 December
2017 2016
Notes GBP000 GBP000
------------------------------------- ------ ------------ ------------
Cash flows from operating
activities
Total comprehensive loss for
the year (3,606) (2,644)
Adjustments for:
Amortisation 307 160
Depreciation 260 261
Loss on sale of fixed assets 17 -
Net finance cost - 3
Taxation 5 (246) (149)
Share based payment charge 1,581 1,572
------------------------------------- ------ ------------ ------------
Operating cash outflow before
changes in working capital (1,687) (797)
------------------------------------- ------ ------------ ------------
Changes in inventories (475) (767)
Changes in trade and other
receivables (635) (968)
Changes in trade and other
payables 271 921
------------------------------------- ------ ------------ ------------
Total cash outflow from operations (2,526) (1,611)
------------------------------------- ------ ------------ ------------
Cash flow from investing activities
Purchase of property, plant
and equipment (255) (402)
Purchase of intangible assets (799) (558)
Interest received - 1
Net cash outflow from investing
activities (1,054) (959)
------------------------------------- ------ ------------ ------------
Cash flow from financing activities
Proceeds from issue of share 14,848 -
capital
Expenses paid on share issues (828) -
Repayment of borrowings - (49)
Interest paid - (4)
------------------------------------- ------ ------------ ------------
Net cash inflow from financing
activities 14,020 (53)
------------------------------------- ------ ------------ ------------
Net increase in cash and cash
equivalents 10,440 (2,623)
Opening cash and cash equivalents 6,130 8,753
------------------------------------- ------ ------------ ------------
Closing cash and cash equivalents 16,570 6,130
------------------------------------- ------ ------------ ------------
Consolidated statement of changes in equity
Employee
benefit Foreign
Share Share trust Other exchange Retained Total
capital premium reserve reserve reserve deficit Equity
GBP000 GBP000 GBP000 GBP000 GBP'000 GBP000 GBP000
At 31 December
2015 4,025 10,228 (61) (907) - (1,269) 12,016
------------------------- ---------- ---------- --------- ---------- ---------- ----------- ---------
Issue of shares
-consideration
relating to
sponsorship
services 4 January
2016 22 103 - - - - 125
Issue of shares
to EBT on 23
March 2016 275 - (275) - - - -
Exercise of
share options - - 121 - - (121) -
Share based
payments - - - - - 1,372 1,372
Total comprehensive
expense for
the period (50) (2,644) (2,694)
At 31 December
2016 4,322 10,331 (215) (907) (50) (2,662) 10,819
------------------------- ---------- ---------- --------- ---------- ---------- ----------- ---------
Issue of shares
- consideration
related to sponsorship
9 January 2017 16 109 - - - - 125
Placing and
open offer 4
December 2017 2,121 12,727 - - - - 14,848
Transaction
cost of placing (828) (828)
Issue of shares
to EBT - 23
March 2017 224 - (224) - - - -
Exercise of
share options - - 42 - - (42) -
Share based
payments - - - - - 1,372 1,372
Total comprehensive
expense for
the period - - - - 78 (3,606) (3,528)
At 31 December
2017 6,683 22,339 (397) (907) 28 (4,938) 22,808
------------------------- ---------- ---------- --------- ---------- ---------- ----------- ---------
1. Accounting policies
Basis of preparation
This final results announcement for the year ended 31 December 2017 has been prepared in accordance with the recognition and measurement criteria of International Financial Reporting Standards ("IFRSs") as adopted for use in the European Union and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS. The accounting policies applied are consistent with those set out in the Science in Sport plc Annual Report and Accounts for the year ended 31 December 2017.
The financial information contained within this final results announcement for the year ended 31 December 2017 and the year ended 31 December 2016 is derived from but does not comprise statutory financial statements within the meaning of section 434 of the Companies Act 2006. Statutory accounts for the year ended 31 December 2016 have been filed with the Registrar of Companies and those for the year ended 31 December 2017 will be filed following the Company's annual general meeting. The auditors' report on the statutory accounts for the year ended 31 December 2017 and the year ended 31 December 2016 is unqualified, does not draw attention to any matters by way of emphasis, and does not contain any statement under section 498 of the Companies Act 2006.
2. Segmental reporting
The Group's operating segments are determined based on the Group's internal reporting to the Chief Operating Decision Maker (CODM). The CODM has been determined to be the Chief Executive Officer, with support from the Board and senior management team. The performance of operating segments is assessed on earnings before interest, tax and depreciation, excluding equity-settles share option charges recognised under IFRS 2 "Share-based payment".
The Core segment manufactures and sells sports nutrition in the UK through SiS.com, third-party etailers, grocers, high street and heartland bike shops. Also included in this segment is sales to Europe (excluding Italy) through distributors and online.
Core International Total
Group
Year ended 31 December GBP'000 GBP'000 GBP'000
2017
------------------------------- -------- -------------- ----------
External revenue 13,904 1,711 15,615
------------------------------- -------- -------------- ----------
Segment loss before recharges (72) (1,632) (1,704)
------------------------------- -------- -------------- ----------
Recharge International
costs 671 (671) -
------------------------------- -------- -------------- ----------
Segment profit/(loss) 599 (2,303) (1,704)
------------------------------- -------- -------------- ----------
Depreciation and amortization (567) (567)
------------------------------- -------- -------------- ----------
Share based payment charge (1,581) (1,581)
------------------------------- -------- -------------- ----------
Loss from operations (1,549) (2,303) (3,852)
------------------------------- -------- -------------- ----------
Loss before taxation (1,549) (2,303) (3,852)
=============================== ======== ============== ==========
Revenue from one customer of GBP2,181,333 individually exceeds 10% of Group revenue (2016: one, GBP1,867,000). All non-current assets, except for an immaterial amount of fixed assets, are located in the UK.
Turnover by geographic destination Year ended Year ended
may be analysed as follows: 31 December 31 December
2017 2016
GBP000 GBP000
United Kingdom 11,217 9,495
EU excluding the UK 2,880 1,922
Australia 680 530
Rest of the World 838 296
15,615 12,243
--------------------------------------- -------------- -------------
3. Operating expenses
Year ended Year ended
31 December 31 December
2017 2016
GBP000 GBP000
------------------------------- ------------- -------------
Sales and marketing costs 7,982 5,931
-------------------------------- ------------- -------------
Operating costs 3,037 2,246
Depreciation and amortisation 567 419
Share based payment charge
(1) 1,581 1,572
Exceptional costs - -
Administrative expenses 5,185 4,237
Total operating expenses 13,167 10,168
--------------------------- ------- -------
(1) Includes associated social security costs of GBP83,000 (31 December 2016: GBP75,000) and consideration in respect of sponsorship services of GBP125,000 (31 December 2016: GBP125,000).
4. Loss from operations
Loss from operations is stated Year Year
after charging: ended ended
31 December 31 December
2017 2016
GBP000 GBP000
------------------------------------- -------------- -------------
Depreciation of property, plant
and equipment 260 261
Amortisation of intangible assets 307 160
Research and development costs 339 337
Grant income in respect of research
and development tax credits 125 262
Foreign exchange losses/(gains) 121 (69)
Loss on disposal of property, plant 17 -
and equipment
Operating lease costs 196 177
5. Taxation
Year
ended Year ended
31 December 31 December
2017 2016
GBP000 GBP000
--------------------------------------- -------------- -------------
Current tax income
United Kingdom corporation tax - -
Adjustment in respect of prior - -
period
Total current tax income - -
Deferred tax
Effect of change in tax rates - -
Origination and reversal of temporary
differences 246 149
Tax on loss for the period 246 149
--------------------------------------- -------------- -------------
The tax assessed for the year is different from the standard rate of corporation tax in the UK. The differences are explained below:
Loss before tax 3,852 2,793 ------------------------------------------ ------ ------ Loss before tax multiplied by the standard rate of corporation tax in the UK of 19% (2016: 20%) 741 559 Effects of: Expenses not deductible for tax purposes (289) (183) Additional deduction for R&D expenditure (72) (36) Share scheme deduction (14) (16) Effect of changes in tax rate (3) (3) Adjustment in respect of previous period (94) (172) Capital allowances in excess of depreciation (23) ------------------------------------------ ------ ------ Total tax credit for the year 246 149 ------------------------------------------ ------ ------
At 31 December 2017 UK tax losses of the Company available to be carried forward are estimated to be GBP4,259,000 (31 December 2016: GBP4,011,000).
Deferred tax balances are valued at the rate of 18% in these accounts to the extent that timing differences are expected to reverse after this later date.
6. Loss per share
Basic and diluted loss per share is calculated by dividing the loss attributable to owners of the parent by the weighted average number of ordinary shares in issue during the period. The exercise of share options would have the effect of reducing the loss per share and is therefore anti-dilutive under the terms of IAS 33 'Earnings per Share'
Year Year
ended ended
31 December 31 December
2017 2016
Loss for the year/period attributable
to owners of the parent - GBP000 (3,606) (2,644)
Weighted average number of shares 46,695,814 42,527,844
Basic and diluted loss per share
- pence (7.7p) (6.2p)
--------------------------------------- ------------- -------------
7. Inventories
31 December 31 December
2017 2016
GBP000 GBP000
---------------- ------------ ------------
Raw materials 883 824
Finished goods 1,830 1,414
2,713 2,238
---------------- ------------ ------------
There is a provision of GBP27,000 included within inventories in relation to the impairment of inventories (31 December 2016: GBP23,000).
During the year inventories of GBP4,852,000 (31 December 2016: GBP3,651,000) were recognised as an expense within cost of sales.
8. Trade and other receivables
31 December 31 December
2017 2016
GBP000 GBP000
--------------------------------------- ------------ ------------
Trade receivables 1,947 1,678
Less: provision for impairment
of trade receivables (43) (42)
--------------------------------------- ------------ ------------
Trade receivables - net 1,904 1,636
Other receivables 436 334
--------------------------------------- ------------ ------------
Total financial assets other than
cash and cash equivalents classified
as loans and receivables 2,340 1,970
Prepayments and accrued income 511 247
--------------------------------------- ------------ ------------
Total trade and other receivables 2,851 2,217
--------------------------------------- ------------ ------------
9. Trade and other payables
31 December 31 December
2017 2016
GBP000 GBP000
------------------------------------- ----------- -----------
Trade payables 1,222 1,130
Accruals 1,382 1,324
------------------------------------- ----------- -----------
Total financial liabilities measured
at amortised cost 2,604 2,454
Other taxes and social security 206 80
Total trade and other payables 2,810 2,534
------------------------------------- ----------- -----------
The Directors consider that the carrying amount of these liabilities approximates to their fair value.
All amounts shown fall due within one year.
10. Deferred tax
Deferred tax is calculated in full on temporary differences under the liability method using a tax rate of 18% (31 December 2016: 18%). Details of the deferred tax asset and liability, amounts recognised in profit or loss and amounts recognised in other comprehensive income are as follows:
Credited/
(charged)
to income
statement
At 31 December in the At 31 December
2016 year 2017
GBP000 GBP000 GBP000
---------------------------- ----------------- ----------- -----------------
Capital allowances
in excess of depreciation (103) (10) (113)
Unutilised tax losses 722 45 767
Other short term timing
differences 467 211 678
(1,086) 246 1,332
---------------------------- ----------------- ----------- -----------------
A deferred tax asset of GBP1,332,000 (31 December 2016: GBP1,086,000) has been recognised in respect of tax losses and other temporary differences where the Directors believe it is probable that these assets will be recovered. The Directors consider it appropriate to recognise a deferred tax asset in respect of tax losses on the basis that the losses incurred to date are as a result of the Group's current strategy to invest in growing revenue and they therefore consider it reasonable to conclude that suitable taxable profits against which losses can be utilised will be generated in the foreseeable future.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR SELFMSFASEID
(END) Dow Jones Newswires
March 21, 2018 03:00 ET (07:00 GMT)
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