Final Results

RNS Number:3057X
VASTox plc
29 May 2007

                                   VASTox plc

                          ("VASTox" or "the Company")


             PRELIMINARY RESULTS FOR THE YEAR ENDED 31 JANUARY 2007


Oxford, UK, 29 May 2007 - VASTox plc (AIM: VOX), a leading UK biotechnology
company, today announces its preliminary results for the year ended 31 January
2007.


A presentation to analysts will be held today at 09.30hrs at the offices of
Evolution Securities Limited, 100 Wood Street, London EC2V 7AN. Please contact
Mark Swallow, Valerie Auffray or Janine Hagan on 020 7638 9571 for further
information.


VASTox will also hold a webcast presentation, which can be accessed at VASTox's
website at www.vastox.com or at www.investorcalendar.com from 14:00hrs BST.


Financial Highlights

*    Revenues increased 95% to #1.0 million (2005/06: #0.5 million) from over 
     25 ongoing service contracts

*    R&D Investment up to #2.9 million (2005/06: #1.0 million)

*    Post-tax loss of #3.0 million (2005/06: #1.1 million)

*    Successful placing in February 2006 raised #10.4 million before expenses to
     progress DMD programme

*    Cash of #18.3 million at 31 January 2007 (2005/06: #12.6 million)


Operational Highlights (during 2006/07 and post year-end)

*    Drug discovery and development, and pharmaceutical services capabilities 
     enhanced through three strategic acquisitions:

     o   DanioLabs Ltd - for #15 million satisfied by the issue of shares (March
         2007)

     o   Dextra Laboratories Ltd - for #1.5 million satisfied by the issue of
         shares (March 2007)

     o   Key assets of MNL Pharma Ltd - for #240,000 (December 2006)

*    Drug pipeline expanded significantly through acquisition and internal
     development and now includes:

     o   Two clinical phase candidates acquired in the area of neuro-disorders

     o   Four pre-clinical candidates in neuromuscular, oncology and ophthalmic
         diseases

     o   Preclinical programmes progressing in neuromuscular and infectious
         diseases

     o   New discovery programmes initiated in cancer and regenerative medicine

*    Two long-term drug discovery and development collaboration deals signed 
     worth over a total of #650,000 (February 2007)

*    Royalty deal signed for carbohydrate drug development worth $450,000 and 5%
     of product sales (May 2007)

*    Board of Directors and Senior Management strengthened with several key
     appointments:

     o   Barry Price, PhD appointed as Non-executive Chairman to replace
         Professor Stephen Davies who steps down to Non-executive Director

     o   Richard Storer, DPhil appointed Chief Scientific Officer

     o   Darren Millington, ACMA appointed Chief Financial Officer

     o   James Taylor appointed Chief Commercial Officer

     o   Colin Wall, PhD appointed Senior Independent Non-executive Director

     o   Andy Richards, PhD appointed Non-executive Director in March 2007

     o   George Elliott, CA appointed Non-executive Director in April 2007

*    Summit plc proposed as new company name to reflect the ambitions and
     aspirations of the enlarged Company while providing an identity that has 
     the flexibility to accommodate future growth and development within the 
     business.



Commenting on the results, Steven Lee, Chief Executive of VASTox plc, said:

"This has been an excellent year of achievement and growth for VASTox, during
which we have made significant progress towards our primary objective of
creating long-term value for our shareholders. Over the past 18 months, through
strategic acquisitions and internal development, we have built the foundations
of a strong company with a broad, high-quality drug pipeline and two innovative
technology platforms, of which we are now world leaders. We have also nearly
doubled revenues from applying these technologies to partners' programmes and
have recently been able to strike higher-value, longer-term collaborative deals,
which illustrates the strides our service business has made.  The enlarged
Company is now well positioned to realise the potential within the business and
to generate significant and sustainable value for shareholders over the coming
years."



For more information please contact:


VASTox                                                 Tel: [phone]
Steven Lee, PhD, Chief Executive Officer               Mob: [phone]
Darren Millington, ACMA, Chief Financial Officer       Mob: [phone]

Citigate Dewe Rogerson                                 Tel: [phone]
Mark Swallow / David Dible / Valerie Auffray           Mob: [phone]

Evolution Securities                                   Tel: [phone]
Tim Worlledge / Bobbie Hilliam / Neil Elliot



About VASTox plc


VASTox is a leading UK biotechnology company that discovers and develops
proprietary new drugs. The Company's internal drug development programmes are
underpinned by its advanced chemistry and drug screening (chemical genomics)
technology platforms, which it also provides on a collaborative or
fee-for-service basis to the pharmaceutical industry.


VASTox has a broad range of drug discovery programmes in the clinical,
pre-clinical and discovery stages of development, which target serious diseases
with a high unmet medical need. These therapeutic areas include neuro-disorders
(neurodegenerative and neuromuscular), anti-infectives, ophthalmic diseases,
oncology and regenerative medicines.


VASTox's in-house drug development capabilities combine world-class expertise in
both medicinal and carbohydrate chemistry with high-volume, high-content
screening using its proprietary zebrafish and fruitfly technologies (chemical
genomics). These whole organism screens have the potential to dramatically
decrease the time and cost of drug discovery and development by delivering data
that are highly predictive of the efficacy and toxicity of potential drug
compounds in humans.


The company listed on the AIM market of the London Stock Exchange in October
2004 - symbol: VOX


This document contains "forward-looking statements" within the meaning of the
U.S. Private Securities Litigation Reform Act of 1995. Forward-looking
statements can be identified by words such as "anticipates", "intends", "plans",
"seeks", "believes", "estimates", "expects" and similar references to future
periods, or by the inclusion of forecasts or projections.


Forward-looking statements are based on the Company's current expectations and
assumptions regarding our business, the economy and other future conditions.
Because forward-looking statements relate to the future, by their nature, they
are subject to inherent uncertainties, risks and changes in circumstances that
are difficult to predict. The Company's actual results may differ materially
from those contemplated by the forward-looking statements. The Company cautions
you therefore that you should not rely on any of these forward-looking
statements as statements of historical fact or as guarantees or assurances of
future performance. Important factors that could cause actual results to differ
materially from those in the forward-looking statements and regional, national,
global political, economic, business, competitive, market and regulatory
conditions.



CHAIRMAN'S REVIEW


It gives me great pleasure to report on a very busy and productive 18 months for
VASTox, and a period in which we believe the Company has reached a new stage of
development and growing maturity, having advanced out of its start-up phase.
This transformation has been achieved both through impressive organic growth and
through a focused acquisition strategy during this period.


Our main objective is to create shareholder value. As a leading drug discovery
and development company, the acquisitions in March 2007 of the companies
DanioLabs Ltd (Cambridge), and Dextra Laboratories Ltd (Reading) plus the
earlier acquisition of key assets of MNL Pharma Ltd (Aberystwyth), provide
VASTox with world leadership in zebrafish chemical genomics and carbohydrate
chemistry as we endeavour to deliver on this objective.


The Company now has substantial assets that it aims to leverage in different
ways to deliver sustainable growth and maximise shareholder value. We believe
that we have made great strides in this direction to date and that our
strengthened position now will lead to further opportunities to accelerate
growth in the future.


In summary, the Company has made great advances in developing its drug pipeline,
enhancing its drug discovery and development capabilities, adding expertise and
experience at board, management and scientific levels, and boosting revenue
growth of its pharmaceutical services.


A significant impact of the activities we have undertaken is the building of an
exciting pipeline of clinical, preclinical and discovery stage drug candidates
across a range of therapeutic areas with high unmet medical need.


Programmes in VASTox's core areas of expertise at this stage, include
neuro-disorders and infectious diseases, and are areas where we can call on
considerable scientific and development knowledge to add value to our
programmes. Currently, we have lead candidates in clinical development targeting
the symptoms of Parkinson's disease and preclinical programmes in Duchenne
muscular dystrophy and Spinal muscular atrophy. The Company's differentiating
expertise in these areas will be used to develop candidates to an optimal point
before licensing or partnering out. By retaining a high equity stake in the
future value of the programme, we are also looking to generate significant
long-term returns for shareholders.


Programmes outside our core areas, including cancer, ophthalmology and
regenerative medicine (stem cells), represent opportunities for attractive early
deals to realise near-term value while retaining a stake in their longer-term
potential. Our first out-licensing opportunity is likely to be with our lead
anticancer candidate, VOX14400, which we are planning to enter into Phase I
clinical trials in 2008.


Underpinning the development of our pipeline as well as providing increasing
revenues, are VASTox's proprietary chemical genomics and substantial chemistry
capabilities. These capabilities have been significantly enhanced in terms of
expertise, staff, facilities and capacity following the recent acquisitions.
Furthermore, they have provided us with existing business, immediate revenue
streams and access to a wider customer network.



People


The Company made a number of important changes to the board and senior
management during the year as we reviewed the skills necessary to lead a dynamic
and fast-growing company. We have brought in high-quality people with a wealth
of skills, particularly in drug discovery, development and commercialisation,
all of which will be crucial for the Company's future growth.


In addition, through the acquisitions, VASTox has rapidly expanded to employ
more than 100 highly skilled scientists across four UK sites. We are also very
pleased to have retained the key scientific founders of the acquired businesses
and look forward to their continued contribution to the business.


I would just like to take this opportunity to thank Professor Stephen Davies who
stepped down as Chairman in September 2006. Steve, as founding Chairman of
VASTox, has made a significant contribution to the Company's direction and
success, and we are very pleased that he will continue to provide valuable input
as a Non-executive Director.


I would also like to welcome to the Board, Dr Colin Wall, Dr Andrew Richards and
George Elliott. Colin has 40 years' of commercial experience including
significant board-level experience at a number of public and private companies
and was appointed as Senior Independent Non-executive Director. He replaces
founding director John Montgomery who stepped down last year with our thanks and
best wishes. Andrew joins as a Non-executive Director and will bring a
tremendous wealth of experience of the biotechnology sector to VASTox, while
George brings us wide-ranging financial and commercial expertise in high growth
technology companies.


Financial Performance


The financial performance of the Company continues to be strong - these will be
discussed in more detail in the Financial Review below, but in summary: revenues
from our pharmaceutical business have nearly doubled to #1.0 million compared
with last year; investment in research has increased to #2.9 million from #1.0
million last year; losses are up to #3.0 million from #1.1 million; and cash at
the end of the reporting period is #18.3 million (#12.6 million at the same time
last year). The Company continues to maintain a strong focus on financial
discipline and expects to continue its growth and development in all areas in
2007.


Name Change to Summit plc


Based on the progress the Company has made over the past couple of years and its
long-term development plans, we are very pleased to propose a new name for the
Company: Summit plc. We are proposing this name as it encapsulates the desire
and ambitions of the Company while also providing an identity that has the
flexibility to accommodate future growth and development within the business.
This name change is subject to shareholder approval, which will be sought at the
Company's Annual General Meeting, to be held on 19 July 2007.


Summary and Outlook


Since I joined VASTox in September 2006, I have been greatly impressed with the
company's ambitions, enthusiasm and maturity, the quality of its people, and the
strength and potential of its drug discovery and development capabilities.


The transforming events that have happened over the past 18 months have put
VASTox in a strong position to capitalise on this potential in the near, mid and
long term. We are looking forward with confidence to the challenges that the
next year will bring to continue the rapid growth of the business.


Finally, I would like to thank all VASTox employees for their dedication and
contribution to the business and look forward to an exciting and productive year
ahead.


Barry Price, PhD
Chairman


29 May 2007


CHIEF EXECUTIVE OFFICER'S STATEMENT


VASTox has made excellent progress during the past 18 months executing on its
dual strategy of discovering and developing proprietary new drugs and providing
profitable drug discovery services to the pharmaceutical industry. Following a
number of defining events that have happened during the period, the Company is
now in a strong position to maximise the benefits of its unique approach to
create significant value for shareholders.


The key events of the period include:

*    Progress in all proprietary programmes, including:

     o   Duchenne muscular dystrophy: Candidate selection in May 2007; Orphan
         Drug designation from EMEA

     o   Spinal muscular atrophy: compounds identified with in vivo activity

     o   Tuberculosis: compounds identified that kill Mycobacterium tuberculosis

*    Excellent performance of the pharmaceutical services business with
     revenues nearly doubling to #1 million

*    The creation of a high-quality executive management team and board of
     directors with experience and enthusiasm to drive the Company's future 
     growth

*    Acquisitions of DanioLabs Ltd, Dextra Laboratories Ltd and the key assets 
     of MNL Pharma Ltd to accelerate the Company's strategy and development in
     all areas of its business.


Transforming VASTox


The acquisitions VASTox has made during 2006/07 are a synergistic fit with our
existing drug programmes, drug discovery and development expertise and,
significantly, provide us with world leadership in two discovery platform
technologies. Additionally, we benefit from an immediate, positive impact on
revenues and an expanded customer base.


The addition of DanioLabs both broadens our drug discovery pipeline and creates
the largest and most sophisticated zebrafish chemical genomics platform in the
World. Dextra and MNL Pharma both bring differentiating carbohydrate chemistry
expertise and make us world leaders in this emerging and exciting area of drug
discovery.


A key focus of the management team in the coming months is to ensure the rapid
integration of the acquired businesses such that VASTox can capitalise on the
enhanced capabilities and efficiencies of the enlarged Group.


As a consequence of the year's activities, we are proposing to change the
Company's name from VASTox plc to Summit plc (subject to shareholder approval at
the Company's AGM on 19 July 2007). The Board believes that a new identity is
required to truly reflect the aspirations of the new enlarged business.  VASTox
as a name represented the origins of the Company but it refers to only one
aspect of our business: zebrafish toxicology services.  While this technology is
still an important part of our business, we felt the Company has outgrown this
name, and has also become misleading with commercial clients. The proposed new
name and identity presents not only a more mature corporate image but also
provides the flexibility for the Company to grow and develop, which is essential
in meeting the future needs of our business.



Enhancing our Drug Pipeline


As mentioned above, an important result of this recent corporate activity has
been to broaden and enhance the Company's drug discovery and development
pipeline. Through progress made in our existing drug discovery programmes and
the new programmes acquired following the deals with DanioLabs and MNL Pharma,
VASTox now has an exciting portfolio of clinical, preclinical and discovery
stage drug candidates across a range of serious diseases with a high unmet
medical need.


While our drug programmes span a range of therapeutic areas, our core focus is
on discovering and developing new therapies targeting neuro-disorders and
infectious diseases. We have focused on these specific therapeutic areas as we
believe we have differentiating expertise based on our scientific knowledge in
these areas, through our key staff, scientific advisors, founders and
collaborators. It is our intention to invest in the infrastructure of these
programmes in order to develop them to the optimal stage prior to seeking
attractive partnering opportunities.


The depth of our drug pipeline combined with our approach towards partnering
deals is anticipated to improve, for our investors, the risk-reward ratio
traditionally associated with biotech companies as it is VASTox's intention to
seek early and mid-stage deals in many programmes before they enter pivotal and
costly Phase III clinical trials.


Core Programmes

During the year, VASTox has increased its interest and expertise in the area of
neuro-disorders and now has a range of clinical and preclinical programmes in
this area.


VASTox has two candidates in Phase I clinical trials for treating
neurodegenerative symptoms associated with Parkinson's disease. These were
acquired from DanioLabs. The first programme is focused on sialorrhoea
(excessive saliva production) and is expected to advance into Phase II clinical
trials by the second half of 2007. The second clinical candidate targets
seborrhoea, which results in Parkinson's patients suffering from poor skin
conditions, and this programme is expected to move into Phase II clinical trials
during the second half of 2008. VASTox also anticipates this programme to find
value in the multi-million pound acne market.


In addition, exciting progress has been made in the discovery programme
targeting the fatal neuromuscular disease, Duchenne muscular dystrophy, and in
May 2007 this led to the selection of a lead candidate, VOX C1100, to advance
into preclinical development. Earlier investigations leading to this significant
achievement have been supported through the raising of #10.45 million in
February 2006.


Based on this progress, the European Medicines Agency ('EMEA') will grant Orphan
Drug status to any clinical candidates to emerge from the programme. This
designation will allow VASTox to fast-track any candidates through the clinical
stages of development, which will reduce costs and accelerate the time taken for
a desperately needed drug to reach the market.


Our discovery programme targeting the rare genetic neuromuscular disorder Spinal
muscular atrophy ('SMA') is also making excellent progress. SMA is the leading
genetic cause of mortality in infants and toddlers worldwide and the Company has
identified a number of 'hit' compounds that improve the symptoms of SMA when
tested in VASTox's in-vivo- fruitfly screen designed to model the disease. This
particular programme demonstrates the value of our drug discovery approach as
these 'hits' were identified within 18 months of the programme starting, and a
lead preclinical compound is now being sought. We are also preparing to apply
for Orphan Drug designation for this programme.


VASTox's excellence and expertise in neuromuscular diseases was further
recognised by the EU when the Company joined the TREAT-NMD network, a European
network of leading researchers, clinicians and charities focused on developing
new medicines, and which is funded by a Euro10 million EU grant.


In the core area of infectious diseases, VASTox's first programme is targeting
tuberculosis ('TB'), a resurgent disease with serious global health
implications. Currently, the TB programme is in the early discovery phases and
has made good progress during the year with several promising compounds
identified as being active against the bacteria that cause TB. These 'hit'
compounds are now being investigated further.


Other programmes

Our remaining programmes are currently targeting cancer, ophthalmic diseases and
regenerative medicine (stem cells), and we have three programmes at the
preclinical stage of development.


One of our most advance non-core programmes, VOX14400, was initially developed
by MNL Pharma and has the potential to target and treat various types of solid
tumours as well as a number of other indications. We are actively seeking a
development partner to progress this candidate.


The programmes in ophthalmic diseases are targeting glaucoma and age-related
macular degeneration and are in the preclinical stages of development. Both
programmes were acquired from DanioLabs.


Pharmaceutical Services


While our drug pipeline is where our long-term value lies, a core element of our
dual business model is the development of two powerful drug discovery and
development technology platforms. These not only underpin our ability to develop
and fuel our own pipeline, but also enable us to generate revenues by providing
elements of the technology platforms to partners in the pharmaceutical sector
for their own drug discovery purposes.


Our service offering is an increasingly profitable part of the Company's
business, generating revenues of #1 million in 2006, nearly double the revenues
of 2005. The wider pharmaceutical industry increasingly is recognising the value
our unique capabilities bring to drug discovery programmes as we provided
discovery services to over 25 clients during the year.


This business is expected to grow significantly in 2007 owing to the
strengthening of our capabilities in all areas through the integration of the
assets from the acquired companies. This will provide the enlarged Company with
immediate access to complementary expertise and high-quality facilities as well
as existing contracts and revenue streams, and access to a significantly broader
customer base.


Furthermore, these acquisitions are expected to support and accelerate our
strategy of developing longer-term, higher-value drug discovery and development
partnerships with pharmaceutical companies. Indeed, in 2007 we have already
signed three such agreements totalling over #800,000 in upfront payments and
research funding milestones with one of the deals including a 5% royalty fee on
product sales. Over the course of the next 12 months, we will be working hard to
develop further relationships of this nature based on the benefits our unique
range of capabilities can offer partners.


Our Unique Drug Discovery and Development Capabilities


The fundamentals of our business and of our ability to create value are based on
our world-leading chemical genomics and carbohydrate technology platforms.
During the year, each platform has been significantly strengthened both
organically and through the recent acquisitions we have made.


Chemical Genomics

Chemical genomics refers to the analysis and understanding of the effect that
drug-like molecules have on whole organisms. VASTox has developed an industry
leading chemical genomics technology platform that makes use of two extensively
studied organisms: zebrafish and fruitflies.


This technology enables us to rapidly screen libraries of drug-like compounds to
provide information not just on potential efficacy but also on the safety of
lead compounds. This capability is extremely valuable as it can accelerate the
early stages of the discovery process thereby reducing overall costs.


The acquisition of DanioLabs shows the belief and commitment VASTox has in
zebrafish chemical genomics and the huge potential benefits that we believe this
technology brings to the drug discovery process. This strategic move has created
the World's leading company in chemical genomics using this versatile and highly
relevant organism by providing additional zebrafish screening technologies and
capacity and further novel human disease models.


Chemistry Capabilities

We also recognise that chemistry plays an essential role in the development of
new pharmaceuticals. Our chemistry capabilities enable us to generate libraries
of proprietary drug-like compounds for screening, to develop 'hit' compounds
into leads and to optimise their structure and performance.


We already have excellent medicinal chemistry in-house and the integration of
Dextra Laboratories and MNL Pharma significantly enhances our carbohydrate
chemistry expertise and capabilities as VASTox emerges as the global leader in
this high-value, complex and currently under exploited area of chemistry.


Management


A key objective over the past 12 months for VASTox has been to create a high
quality management team with development and commercial experience, contacts,
and enthusiasm to drive the Company's ambitious growth plans forward.


As such, VASTox made several key appointments to the executive management team
during the year including: Dr Richard Storer, who joined the Board as Chief
Scientific Officer; Darren Millington, ACMA, who was appointed to the Board as
Chief Financial Officer; and James Taylor who joined the Board as Chief
Commercial Officer. These appointments add considerable sector experience in the
important areas of preclinical and clinical drug development, commercialisation,
licensing and growth company finance.


Summary and Outlook


The past 18 months have been extremely busy and eventful for VASTox. This
activity has transformed the business into an exciting drug discovery and
development company that offers the prospect of rapidly developing new drugs for
serious diseases. Through internal growth and acquisition, VASTox has created a
broad and diverse pipeline of drug candidates from discovery to clinical stages
of development, and two strong technology platforms to support and advance these
programmes.


Furthermore, the revenue growth we have seen from our services offering and its
increasing industry validation confirms the confidence we have in our approach
to deliver value to customers and partners in the pharmaceutical sector.


We anticipate a busy year in 2007/08, integrating the new components of our
business, but we believe we have many of the right elements in place to begin
capitalising on the combined strength of the enlarged Company to create
significant value for our shareholders.


Finally, I would like to thank the efforts of all involved with the continued
growth and development of VASTox and look forward to reporting further progress
in the future.


Steven Lee PhD
Chief Executive Officer


29 May 2007



FINANCIAL REVIEW


Our financial results for the year ended 31 January 2007 reflect the increasing
investment in our drug development pipeline, in particular our commitment to
advancing our Duchenne muscular dystrophy ('DMD') programme. Total R&D costs
have increased to #2.9 million this year (#1.03 million in 2005/06). As
described in the Chief Executive Officer's report, we were able to accelerate
our DMD programme as a result of a successful fund-raising in February 2006,
which raised #9.97 million after expenses. These additional funds have allowed
us to recruit specialist staff and build laboratories dedicated to the DMD
programme.


Business Performance


Revenues

Total revenues for the year ended 31 January 2007 were #1.03 million (2005/06:
#0.53 million). This 95% increase illustrates the increasing market demand for
our unique chemical genomics expertise and chemistry capabilities. Gross margins
increased to 71% (2005/06: 56%), reflecting the high-value nature of the work we
do for clients.


Losses

VASTox made a loss of #2.99 million for the year compared with a loss of #1.06
million in the previous year. The increased loss was due to increased investment
in R&D and an increase in overhead and facility costs. Overhead costs have also
increased due to non-cash charges of depreciation, amortisation and FRS 20 ('
Share based payment'). The FRS 20 charge requires companies to make a charge for
the fair value of share options in issue. For the year 2006/07 this charge was
#0.4 million (2005/06: #0.07 million). It is the recognition of the share based
payment charge in the 2005/06 results which led to a restatement. The basic and
diluted loss per share for the Group was 8.24p, compared with 3.39p for 2005/06.


Taxation

The Group continues to benefit from Research and Development tax credits and, as
it is loss making, elects to take the cash equivalent amount. The tax credit of
#0.49 million relates to a refund under the UK Research and Development tax
credit claim (2005/06: #0.16 million).


Cashflow and financing

Our year-end cash and short term deposits were #18.3 million (2005/06: #12.6
million). The Group raised #9.97 million in cash net of expenses (2005/06: nil)
through the sale of new ordinary shares. Interest received increased from #0.58
million to #0.87 million, due to the increase in average funds held during the
year as well as higher interest rates. Net cash outflow during the year from
operating activities was #3.21 million (2005/06: #1.45 million), principally due
to the increase in R&D expenditure.


IFRS

The accounts prepared for the year ended 31 January 2007 will be the last
produced under UK Generally Accepted Accounting Practice ('GAAP'). In common
with all AIM-quoted companies, VASTox will produce its results for the year
ending 31 January 2008 under International Financial Reporting Standards ('
IFRS'). The first financial results reported under IFRS will be presented in the
Group's unaudited interim results for the six month period ending 31 July 2007.
The Group has completed an impact assessment for the translation to IFRS and has
reviewed the VASTox financial results for the areas likely to change most
significantly. The Group's plan to transfer from UK GAAP to IFRS is monitored
regularly by the Group's Audit Committee and reported to the Board.


Post balance sheet events

Following the year-end, the Group announced on 22 March 2007 the acquisition of
DanioLabs Limited and Dextra Laboratories Limited. The Group acquired the entire
share capital of both companies for #15.0 million and #1.5 million respectively,
financed through the placing of 12.9 million new ordinary shares in VASTox plc.



Darren Millington, ACMA
Chief Financial Officer



29 May 2007

Consolidated Profit and Loss Account
For the year ended 31 January 2007

                                                                                  Restated
                                                                      2007            2006
                                                  Note                   #               #
Turnover                                                         1,033,823         531,361
Cost of sales                                                    (303,673)       (233,444)
Gross profit                                                       730,150         297,917

Research and development                                       (2,937,396)     (1,025,683)
General, management and administration                         (1,830,292)     (1,005,366)
Share based payment                                              (403,898)        (66,626)
Total administrative costs                                     (5,171,586)     (2,097,675)
Other operating income                                              80,357               -
Operating loss                                                 (4,361,079)     (1,799,758)

Interest receivable                                                872,766         582,868

Loss on ordinary activities before taxation                    (3,488,313)     (1,216,890)

Tax on loss on ordinary activities                                 488,942         155,437

Loss on ordinary activities after taxation                     (2,999,371)     (1,061,453)

Basic and diluted loss per ordinary share         2                  8.24p           3.39p



All amounts relate to continuing activities.







Consolidated Statement of Recognised Gains and Losses
For the year ended 31 January 2007
                                                                                  Restated
                                                                      2007            2006
                                                  Note                   #               #
Loss for the financial year                                    (2,999,371)     (1,061,453)
Prior year adjustment                                             (73,826)               -
Total gains and losses recognised since last                   (3,073,197)     (1,061,453)
financial statements




Consolidated Balance Sheet
At 31 January 2007
                                                                                    Restated
                                                                  31 January      31 January
                                                   Note                 2007            2006
                                                                           #               #
Fixed assets
Intangible assets                                                    377,668          28,016
Tangible assets                                                    2,624,054       1,261,082
                                                                   3,001,722       1,289,098
Current assets
Stock                                                                187,444          27,000
Debtors                                                            1,116,746         541,300
Cash on short term deposits                                       15,079,702      11,593,626
Cash at bank                                                       3,209,392       1,039,690
                                                                  19,593,284      13,201,616

Creditors: amounts falling due within one year                   (1,427,111)       (704,833)

Net current assets                                                18,166,173      12,496,783

Creditors: amounts falling due after more than one                 (597,355)       (690,812)
year
Provision for liabilities and charges                              (100,000)
Net assets                                                        20,470,540      13,095,069

Capital and reserves
Called up share capital                                            3,721,707       3,131,311
Share premium account                                             22,327,396      12,946,848
Other reserves                                                   (1,942,589)     (1,942,589)
Share based compensation                                             477,724          73,826
Profit and loss account                                          (4,113,698)     (1,114,327)
Equity shareholders' funds                         3              20,470,540      13,095,069




Company Balance Sheet
At 31 January 2007


                                                                                    Restated
                                                                  31 January      31 January
                                                   Note                 2007            2006
                                                                           #               #
Fixed assets
Investments                                                        2,497,922       2,094,024

Current assets
Debtors - due after more than one year                            24,194,798      14,225,887
Debtors - due within one year                                          2,033               -
                                                                  24,196,831      14,225,887

Net current assets                                                24,196,831      14,225,887

Net assets                                                        26,694,753      16,319,911

Capital and reserves
Called up share capital                                            3,721,707       3,131,311
Share premium account                                             22,327,396      12,946,848
Share based compensation                                             477,724          73,826
Profit and loss account                                              167,926         167,926
Equity shareholders' funds                         3              26,694,753      16,319,911




Reconciliation of operating loss to net cash outflow from operating activities

                                                                                     Restated
                                                                         2007            2006
                                                                            #               #
Operating loss                                                    (4,361,079)     (1,799,758)
FRS 20 charge for fair value of share options                         403,898          66,626
Depreciation charge                                                   340,180         127,520
Amortisation charge                                                    36,236           7,767
Increase in debtors                                                 (171,071)       (246,547)
Increase in stock                                                   (160,444)        (27,000)
Increase in creditors                                                 706,566         423,712
Net cash outflow from operating activities                        (3,205,714)     (1,447,680)






Consolidated Cash Flow Statement
For the year ended 31 January 2007
                                                                         2007            2006
                                                                            #               #
Net cash outflow from operating activities                        (3,205,714)     (1,447,680)

Returns on investments and servicing of finance
Interest received                                                     789,814         507,652

Taxation
R&D tax credit received                                               167,519          29,041

Capital expenditure
Purchase of tangible fixed assets                                 (1,648,152)     (1,357,770)
Purchase of intangible fixed assets                                  (70,626)        (15,783)
                                                                  (1,718,778)     (1,373,553)

Acquisitions
Acquisition of a business                                           (255,131)               -

Cash (outflow) inflow before management of liquid resources and   (4,222,290)     (2,284,540)
financing

Management of liquid resources
Decrease (increase) in short term deposits                        (3,486,076)       2,206,374

Financing
Issue of ordinary share capital (net of expenses)                   9,970,944               -
(Repayment) increase in debt during the year                         (92,876)         756,604
                                                                    9,878,068         756,604

Increase in cash                                                    2,169,702         678,438





Notes to the Accounts


1. Accounting policies


Basis of preparation

The accounting policies used in preparing the financial statements have been
applied consistently throughout all periods presented with the exception of FRS
20 - 'Share based payments.' The Company has adopted FRS 20 for the first time
for the year ending 31 January 2007 and therefore restated prior year results to
reflect the historic impact of this charge. See 'Prior year adjustment' below
for further details.


Share-based payments

In accordance with FRS 20 - 'Share based payment', share options are measured at
fair value at their grant date. The fair value is calculated using the
Black-Scholes formula and charged to the income statement on a straight-line
basis over the expected vesting period. At each balance sheet date, the Group
revises its estimate of the number of options that are expected to become
exercisable. The share-based payment charge is recorded separately in the income
statement.


Prior year adjustment

All quoted UK companies are required to implement accounting standard FRS 20 - '
Share based payment' for financial periods commencing on or after 1 January
2006. This standard affects all companies that issue share options and results
in a non-cash charge to the profit and loss statement to reflect the fair value
of issued share options. In common with the implementation of all accounting
standards, prior year results must be restated as if the accounting standard had
always been in force. In the year ended 31 January 2007 the charge due to the
implementation of FRS 20 is #403,898, and 31 January 2006: #66,626. This
restatement has had no impact on net assets.


The amount recognised in the consolidated statement of total recognised gains
and losses reflect the total share based payment charge from implementing FRS 20
to up 31 January 2006.


The investments in the Company's balance sheet have been restated by the prior
year adjustment of #73,826, this was due to the Company financing the share
based payment charge.


Statutory financial statements

The financial information set out above does not constitute the Company's
statutory accounts for the years ended 31 January 2007 or 2006, but is derived
from those accounts. Statutory accounts for 2006 have been delivered to the
Registrar of Companies and those for 2007 will be delivered following the
Company's annual general meeting. The auditors have reported on those accounts;
their reports were unqualified and did not contain statements under the
Companies Act 1985, sections 237(2) or (3).



2. Earnings per ordinary share


The basic and diluted earnings per share is based on a loss of #2,999,371 for
the year ended 31 January 2007 (Restated 2006: loss of #1,061,453) and the
weighted average number of shares in issue during the year of 36,420,113 shares
(2006: 31,313,111 shares).


3. Reconciliation of movement in Group shareholders funds

                                                                                     Restated
                                                                         2007            2006
                                                                            #               #
Group
Opening shareholders' funds                                        13,095,069      14,089,896
Shares issued during the year                                         590,396               -
Share premium on issued shares (net of expenses)                    9,380,548               -
Loss for the financial year                                       (2,999,371)     (1,061,453)
Share based payment                                                   403,898          66,626
Closing shareholders' funds                                        20,470,540      13,095,069

Company
Opening shareholders' funds                                        16,246,085      16,255,916
Prior year adjustment                                                  73,826           7,200
Opening shareholders' funds - restated                             16,319,911      16,263,116
Shares issued during the year                                         590,396               -
Share premium on issued shares (net of expenses)                    9,380,548               -
Share based compensation                                              403,898          66,626
(Loss) profit for the financial year                                        -         (9,831)
Closing shareholders' funds                                        26,694,753      16,319,911



4. Availability of information


Copies of the Report and Accounts for the year ended 31 January 2007 will be
posted to shareholders shortly and thereafter may be obtained from the Company's
website: www.vastox.com.


5. Notice of Annual General Meeting


The Annual General Meeting will be held at 9.30am on 19 July 2007 at the
following address: Huntsworth plc, 8th Floor, 26 Finsbury Square, London, EC2A
1SF.


                      This information is provided by RNS
            The company news service from the London Stock Exchange
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