TIDMRUA
RNS Number : 2931J
RUA Life Sciences PLC
12 December 2022
12 December 2022
RUA Life Sciences plc
("RUA", the "Company" or the "Group")
Interim Results
RUA Life Sciences, the holding company of a group of medical
device businesses focused on the exploitation of the world's
leading long-term implantable biostable polymer (Elast-Eon (TM) ) ,
today announces its unaudited interim results for the six months
ended 30 September 2022.
Highlights:
-- 56% increase in revenues to GBP1,104,000 (H1 FY2022: GBP708,000)
-- Gross profit GBP875,000 - margin 79% up from H1 FY2022 75%
-- 15% reduction in loss to GBP1,143,000 (H1 FY2022: GBP1,311,000)
-- Strong cash position at GBP2.5 million (30 September 2021:
GBP4.8 million, 31 March 2022: GBP3 million)
-- Investment in development projects increased 7% to GBP908,000 (H1 FY2022: GBP849,000)
-- Progress made in regulatory pathway for Vascular business segment
-- Increased commercial opportunities within Contract Manufacturing business segment
Bill Brown, Chairman of RUA Life Sciences, commented:
"The period has seen good progress made across the four business
segments. Biomaterials has continued its steady growth, Contract
Manufacturing has outperformed our expectations by delivering
increases in sales of 66% at improved margins. The Vascular
business has made good progress with its regulatory objectives
whilst building on the foundations for a viable commercial
business. Structural Heart has identified a solution to the key
risks associated with polymeric heart valve leaflets and further
strengthened the Group's IP in this area. All business segments are
primed for further growth in value over the next few years."
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the UK version of the EU Market Abuse Regulation (2014/596) which
is part of UK law by virtue of the European Union (Withdrawal) Act
2018, as amended and supplemented from time to time.
For further information contact:
RUA Life Sciences
Bill Brown, Chairman Tel: +44 (0)1294 317073
Caroline Stretton, Group Managing Director Tel: +44 (0)1294 317073
Cenkos Securities plc (Nominated Adviser and Broker) Tel: +44 (0)20 7397 8900
Giles Balleny / Max Gould (Corporate Finance)
Michael Johnson (Sales)
About RUA Life Sciences
The RUA Life Sciences group was created in April 2020 when RUA
Life Sciences Plc (formerly known as AorTech International Plc)
acquired RUA Medical Devices Limited to create a fully formed
medical device business. RUA Life Sciences is the holding company
of the Group's four trading businesses, each exploiting the Group's
patented polymer technology.
Our vision is to improve the lives of millions of patients by
enabling medical devices with Elast-Eon (TM) , the world's leading
long-term implantable polyurethane.
Whether it is licensing Elast-Eon (TM) , manufacturing a device
or component, or developing next generation medical devices, a RUA
Life Sciences business is pursuing our vision.
Elast-Eon(TM)'s biostability is comparable to silicone while
exhibiting excellent mechanical, blood contacting and flex-fatigue
properties. These polymers can be processed using conventional
thermoplastic extrusion and moulding techniques. With over 8
million implants and 16 years of successful clinical use, RUA's
polymers are proven in long-term life enabling applications.
The Group's four business segments are:
Contract Manufacturing: End-to-end contract developer and manufacturer
of medical devices and implantable fabric specialist
.
Biomaterials : Licensor of Elast-Eon (TM) polymers to the
medical device industry.
Vascular: Development and commercialisation of the Group's
Elast-Eon sealed Vascular Graft products .
Structural Heart Development of the Group's tri leaflet polymeric
: heart valves .
A copy of this announcement will be available shortly at
www.rualifesciences.com/investor-relations/regulatory-news-alerts
.
CHAIRMAN'S STATEMENT
I am pleased to set out below an overview of the unaudited
interim results of RUA Life Sciences Plc for the six months to 30
September 2022. The period has seen progress in all four business
units and for the first time, the segmental reporting of the
business now reflects the split amongst Biomaterials, Contract
Manufacture, Vascular and Structural Heart.
Unaudited interim results for the six months to 30 September
2022
The results below are the consolidated figures for the entire
group and are further analysed in the relevant segmental update.
The Group has maintained the level of revenue growth seen from the
first to the second half of the year to March 2022. In the six
months to September 2022 revenues of GBP1,104,000 were achieved
representing an increase of GBP396,000 or 56% over revenues in the
six months to September 2021.
Gross margins remained high at 79% resulting in gross profit of
GBP875,000 being reported against the GBP528,000 achieved last year
thus contributing an additional GBP347,000, an uplift of 66%.
Investment in the talent base of the business continued which
contributed to the increase in administrative expenses from
GBP1,658,000 last year to GBP1,889,000. This increase includes
further investment into the Vascular business unit in
particular.
The net impact of growth in turnover together with increased
investment resulted in a GBP168,000 reduction of the group loss to
GBP1,143,000.
Working capital continues to be tightly managed with cash at the
period end amounting to GBP2,509,000 a reduction of GBP454,000 from
the previous year end. Not included in this cash flow or results
for the interim period is the claim for R&D Tax Credits for the
year to 31 March 2022. Our policy is to account for R&D Tax
Credits on a cash basis and the GBP328,000 claimed has yet to be
received from HMRC.
Biomaterials
The Biomaterials business segment is the part of the business
that holds the Intellectual Property relating to Elast-Eon(TM) and
related polymers, and licences that IP to other medical device
companies. The clinical performance of Elast-Eon products continues
to be excellent, particularly in the area of Cardiac Rhythm
Management leads, where over 8 million have been implanted since
2006. The most recently published data indicate that the presence
of Elast-Eon lead insulation dramatically reduces the probability
of abrasion malfunction in tachycardia leads at 15 years by 80%,
from around 5% probability to only 1%.
The Biomaterials business saw royalty and license fee income
increase by 20% compared to the first half of last year rising from
GBP156,000 to GBP187,000 with the growth driven by increased
volumes of Elast-Eon being purchased by licensees. The Biomaterials
business is however very much second half weighted as a result of
the timings of when royalty fees are recognised. In the financial
year ended March 2022, 68% of Biomaterials revenue was recognised
in the second half of the year.
Net margins in Biomaterials remain high with the contribution to
the Group increasing from GBP116,000 (74%) last year to GBP154,000
(82%) in the current period.
Contract Manufacturing
The Contract Manufacturing business segment is the end to end,
third party contract developer and manufacturer of medical devices
that formed part of the RUA Medical acquisition in 2020. This
business has had a very successful period growing revenues from
GBP552,000 in the first half of last year to GBP917,000, an
increase of 66%. We do not specifically report on the gross margins
achieved in this business area but the net contribution to the
group during the period amounted to GBP384,000 being a net
contribution of 42%.
We have implemented price increases within Contract
Manufacturing for the first time in almost ten years but the major
growth driver was a result of increased demand for product from the
major customer. This increase in itself was a result of two
factors, one being the post Covid increase in hospital procedures
in the key US market in particular and the other being a stock
build for European markets in advance of the transition from MDD to
MDR regulations. During the second half year, we anticipate a
continued growth in US orders and maintaining steady levels of
European orders whilst MDR stock build is fully initiated.
Business development has progressed well within the Contract
Manufacturing business, with a new manufacturing contract signed
with a global business for the processing and supply of two
components for its medical device portfolio. First sales have now
been achieved with the first batches manufactured, passed QC and
shipped to the customer under the terms of the supply agreement.
There will be a gradual ramp up in volumes over the next 12 months
with sales expected to stabilise between GBP10,000 and GBP12,000 a
month. In addition, the business is currently working on a number
of requests for quotations for both components and completed
devices. These quotations are for devices that are currently in the
market and as such could convert to manufacturing revenue in a
relatively short period of time compared to development projects.
The annualised revenue potential from these quotations could more
than double the current scale of the Contract Manufacturing
business.
Vascular
The Vascular business segment is currently in the development
stages of commercialising the Group's range of Elast-Eon sealed
vascular grafts and related products. Expensed investment into this
area amounted to GBP619,000 during the period compared to
GBP532,000 last year reflecting an increase in investment for
regulatory planning, manufacturing process and commercial
preparation.
Regulatory progress has been positive but time consuming. Data
had previously been submitted to the FDA on the large bore grafts
which demonstrated that there was a difference in the healing
process to predicate textile grafts currently in the market. These
differences are arguably beneficial due to a lower inflammatory
response and little or no adhesion to the device when tested in
vivo. However, they were different enough for the FDA to want to
have a better understanding of the healing process before allowing
the devices to be marketed. Rather than convert the device to the
longer and more costly PMA process, the FDA has agreed to a
continuance of the 510k pre-market notification process but with
additional work designed around providing additional information on
the healing process. The in vivo work historically undertaken had
data collected at the six-month end point and comparisons made with
the predicate device. At this point, the competitor grafts were
adhered to the perivascular tissue whereas the RUA grafts were
encapsulated but were not adhered to the perivascular tissue. In
order to provide more information on this healing process, further
in vivo work will be undertaken to clarify the healing process at
one and three months in addition to the six-month end point. Having
agreed this process, the requirements for a human clinical study
were much reduced from what they could have been and in broad terms
the study will be of limited scale and utilise a single arm
Performance Goal design, with the primary end point of the trial
being measured at six months post operation. The regulatory team is
currently working towards setting up this trial and finalising the
budget. While the preliminary in vivo work is currently underway,
we continue to assess the best time to start the clinical trial.
RUA will advise in more detail on the expected costs and revised
timescales in due course but in the meantime is actively exploring
opportunities to finance at least part of the clinical stages
through non-dilutive funding routes and grant finance.
Product development and the manufacturing process has made
significant strides over the period. The Quality Management System
is in the process of being transferred to a digital eQMS system
along with the purchasing process, providing both greater control
and cost efficiencies that should increase with the scale of the
business. Importantly, the RUA ISO 13485 quality management
certification has been expanded to cover the entire group and the
scope has been expanded from contract manufacture to legal device
manufacturer. This is a major achievement in itself. With regard to
manufacturing efficiencies, a thorough review of process steps has
resulted in a significant improvement in manufacturing yield. These
efficiencies should enable the current clean rooms at Irvine to
have sufficient capacity to provide for anticipated launch volume
requirements for straight grafts together with demand of up to 10%
market share in North America. The lessons learnt from this process
are now being applied to optimising the design of the larger
cleanroom at the second Irvine facility.
On the commercial developments, product costings indicate that
after allowing for distributor margin, RUA should be able to
achieve a gross margin of around 80% on products sold. Average
selling prices into hospitals range from around $900 to $3,000
depending on the type of device. With regards to the sale of grafts
into hospitals in both the US and other key markets, it has always
been our strategy to work with distributors rather than establish a
direct sales force. We have been in discussions with a number of
parties and are confident that not only is our strategy correct but
there is serious interest in partnership opportunities.
Structural Heart
This is the business segment responsible for developing the
Group's polymeric heart valve technology. Expensed investment in
this area amounted to GBP289,000, a 9% reduction on the same period
last year. The reduction in spend has come about through increasing
the capacity of the in-house team being more than offset by
undertaking fewer tasks with outside contractors.
The focus over the past six months has been risk review and
mitigation. All biological valves fail and the medical profession
even has a name for it - Structural Valve Deterioration (SVD). In
SVD however, the failure mode is slow, and patients develop
symptoms to allow the SVD to be recognised and treated. Unlike
biological valves, the failure rate of mechanical valves is very
low, the problem however is the failure can be catastrophic. This
phenomenon was witnessed during the 1980's with the unfortunate
death of a small number of patients implanted with the Bjork Shiley
mechanical valve, leading to closure of the Shiley valve business
and ultimately to the market dominance of the biological valve.
Testing has shown that Elast-Eon is exceptionally biostable,
non-calcific and non-thrombogenic and as such has the desirable
properties to avoid or at least reduce the incidence of SVD. The
major task for a polymeric valve (assuming the polymer is suitable
for long term implantation) is to persuade regulators, surgeons and
most importantly patients that the valve should not be subject to
catastrophic failure. Polymer valves have been shown to pass long
term durability testing yet there remains a "fear of the new" that
will need to be overcome. RUA has made major steps in improving the
manufacture of 100% polymeric leaflets but has been concentrating
this year on a safer, more durable alternative.
The in vivo studies carried out on the vascular grafts indicated
that Elast-Eon coating the fabric of the graft performed in an
identical manner to what would have been expected of pure
Elast-Eon. The fatigue properties and tear resistance of the graft
material were however many times better than the base Elast-Eon
polymer. Based on this discovery, RUA has taken the coating
technology developed for the graft and, building upon that core IP,
developed a method of creating a true composite material that
retains the proven blood contacting properties of Elast-Eon with
much improved mechanical properties. Finite Element Analysis (FEA)
modelling of the material has been very promising, indicating the
material should have the necessary flexibility without the risk of
delamination. The valve design developed for the 100% Elast-Eon
leaflets has been evolved to take advantage of the new material
properties and the initial prototypes have demonstrated very
encouraging hydrodynamic results, particularly with regards to the
energy required to open the valve. The final stage is to complete
the engineering work on the manufacture of the valves to replace
the manual manufacturing process and allow sufficient numbers of
the desired quality to undergo durability testing.
Conclusion and Outlook
All four business units within the RUA portfolio have made good
progress over the year to date. Biomaterials has seen revenues grow
in the half year with the expectation of a similar second half
weighting to performance as enjoyed last year. The Contract
Manufacturing business has successfully increased unit pricing to
customers and been able to increase volumes without having to
increase head count. Business development has resulted in first
shipments to a new global customer and the business has been asked
to quote for further new business which, if successful, could more
than double turnover in this area. The Vascular business has
overcome the regulatory hurdles of last year and has worked closely
with the FDA towards a clear regulatory plan. The time taken has
been used to establish a robust manufacturing process from which
the cost of manufacture will allow a very attractive margin even
from the pilot plant. The commercial opportunity is in active
discussion and our partnering strategy will be the subject of
future updates. Structural Heart has undertaken some true inventive
steps in the year to date and the device envisaged is being
designed to eliminate all of the objections that have been made
about polymeric heart valves.
RUA Life Sciences still has a way to go to meet all of its
strategic objectives but in considering the progress of each
segment of the business, each one has added value in the year to
date and we look forward to this continuing in the future.
Bill Brown, Chairman
12 December 2022
CONDENSED CONSOLIDATED INTERIM INCOME STATEMENT
Six months ended 30 September 2022
Unaudited Unaudited Audited
Six months Six months Twelve months
to 30 Sep to 30 Sep to 31 Mar
2022 2021 2022
Note GBGBP000 GBGBP000 GBGBP000
----------- ----------- --------------
Revenue 2 1,104 708 1,625
Cost of sales (229) (180) (267)
----------- ----------- --------------
Gross profit 875 528 1,358
Other income 98 37 66
Administrative expenses (1,889) (1,658) (3,315)
Other expenses:
Share-based payments (46) (68) (145)
Bad debt expense - - (3)
Depreciation & amortisation (174) (145) (313)
----------- ----------- --------------
Total administrative
expenses (2,109) (1,871) (3,776)
----------- ----------- --------------
Operating loss (1,136) (1,306) (2,352)
Finance income/(expense) (11) (9) (8)
----------- ----------- --------------
Loss before taxation (1,147) (1,315) (2,360)
Taxation 4 4 293
----------- ----------- --------------
Loss attributable
to equity holders of
the parent company (1,143) (1,311) (2,067)
----------- ----------- --------------
Loss per share (basic
and diluted) - GB Pence (5.15) (5.91) (9.32)
CONDENSED CONSOLIDATED INTERIM STATEMENT OF FINANCIAL
POSITION
Unaudited Unaudited Audited
30 Sep 30 Sep
2022 2021 31 Mar 2022
Note GBGBP000 GBGBP000 GBGBP000
Assets
Non-current assets
Goodwill 3 301 301 301
Other intangible assets 4 495 547 521
Property, plant and
equipment 5 2,543 2,231 2,597
---------- ---------- ------------
Total non-currents
assets 3,339 3,079 3,419
---------- ---------- ------------
Current assets
Inventories 68 177 124
Trade and other receivables 681 866 1,120
Cash and cash equivalents 2,509 4,763 2,963
---------- ---------- ------------
Total current assets 3,258 5,806 4,207
---------- ---------- ------------
Total assets 6,597 8,885 7,626
---------- ---------- ------------
Equity
Issued capital 7 1,109 1,109 1,109
Share premium 7 11,729 11,729 11,729
Capital redemption
reserve 11,840 11,840 11,840
Other reserve (1,507) (1,629) (1,552)
Profit and loss account (17,685) (15,786) (16,542)
---------- ---------- ------------
Total equity attributable
to equity holders of
the parent company 5,486 7,263 6,584
---------- ---------- ------------
Liabilities
Non-current liabilities
Borrowings 364 305 199
Lease liabilities 0 5 83
Deferred tax 71 159 75
Other Liabilities 140 204 174
---------- ---------- ------------
Total non-current
liabilities 575 673 531
---------- ---------- ------------
Current liabilities
Borrowings 86 60 23
Lease liabilities 4 8 39
Trade and other payables 397 847 410
Other liabilities 49 34 39
---------- ---------- ------------
Total current liabilities 536 949 511
---------- ---------- ------------
Total liabilities 1,111 1,622 1,042
---------- ---------- ------------
Total equity and liabilities 6,597 8,885 7,626
---------- ---------- ------------
At 30 September 2022
Unaudited Unaudited Audited
Six months Six months Twelve
to 30 to 30 months to
Sep 2022 Sep 2021 31 Mar 2022
GBGBP000 GBGBP000 GBGBP000
Cash flows from operating activities
Group loss after tax (1,143) (1,311) (2,067)
Adjustments for:
Depreciation and amortisation 174 145 312
Share-based payments 46 68 145
Interest (income) / expense 9 7 8
Tax credit in year - - (293)
(Increase) / decrease in trade
and other receivables 439 563 (53)
(Increase) / decrease in inventories 56 (93) (39)
Increase / (decrease) in taxation (4) (4) 87
Increase / (Decrease) in trade
and other payables (38) (471) (453)
Net cash flow from operating
activities (461) (1,096) (2,353)
----------- ----------- -------------
Cash flows from investing activities
Purchase of property, plant &
equipment (94) (397) (904)
Interest received / (paid) (9) (7) (8)
----------- ----------- -------------
Net cash flow from investing
activities (103) (404) (912)
----------- ----------- -------------
Cash flows from financing activities
Proceeds from borrowing 150 - -
Repayment of loans and lease
liabilities (40) (31) (66)
Net cash flow from financing
activities 110 (31) (66)
----------- ----------- -------------
Net increase / (decrease) in
cash and cash equivalents (454) (1,531) (3,331)
Cash and cash equivalents at
beginning of period 2,963 6,294 6,294
----------- ----------- -------------
Cash and cash equivalents at
end of period 2,509 4,763 2,963
----------- ----------- -------------
CONDENSED CONSOLIDATED INTERIM CASH FLOW STATEMENT
Six months ended 30 September 2022
Condensed consolidated interim statement of changes in equity
Issued Capital Profit
share Share redemption Other and loss Total
capital premium reserve reserve account equity
GBGBP000 GBGBP000 GBGBP000 GBGBP000 GBGBP000 GBGBP000
Balance at 31 March 2021 12,949 11,729 - (1,697) (14,475) 8,506
Transfer of deferred shares (11,840) - 11,840 - - -
Share-based payments - - - 68 - 68
--------- --------- -------------------- --------- --------- ---------
Transactions with owners (11,840) - 11,840 68 - 68
--------- --------- -------------------- --------- --------- ---------
Total comprehensive income
for the period - - - - (1,311) (1,311)
Balance at 30 September
2021 1,109 11,729 11,840 (1,629) (15,786) 7,263
--------- --------- -------------------- --------- --------- ---------
Share-based payments - - - 77 - 77
Issue of equity share capital - - - - - -
- exercise of warrants
Issue of equity share capital - - - - - -
(net of issue costs) - fundraise
--------- --------- -------------------- --------- --------- ---------
Transactions with owners - - - 77 - 77
--------- --------- -------------------- --------- --------- ---------
Total comprehensive loss
for the period - - - - (756) (756)
--------- --------- -------------------- --------- --------- ---------
Balance at 31 March 2022 1,109 11,729 11,840 (1,552) (16,542) 6,584
--------- --------- -------------------- --------- --------- ---------
Transfer deferred share to - - - - - -
capital redemption reserve
Share-based payments - - - 46 - 46
--------- --------- -------------------- --------- --------- ---------
Transactions with owners - - - 46 - 46
--------- --------- -------------------- --------- --------- ---------
Total comprehensive loss
for the period - - - - (1,143) (1,143)
--------- --------- -------------------- --------- --------- ---------
Balance at 30 September
2022 1,109 11,729 11,840 (1,506) (17,685) 5,487
--------- --------- -------------------- --------- --------- ---------
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL
STATEMENTS
1. BASIS OF PREPARATION
General information
RUA Life Sciences plc is the ultimate parent company of the
Group, whose principal activities are contract design and
manufacture of medical devices and exploiting the value of its IP
and know-how.
RUA Life Sciences plc is incorporated and domiciled in the UK
and its registered office is c/o Davidson Chalmers Stewart LLP, 163
Bath Street, Glasgow, G2 4SQ.
Basis of preparation
These condensed consolidated interim financial statements are
for the six months ended 30 September 2022 and have been prepared
with regard to the requirements of IAS 34 on "Interim Financial
Reporting". They do not include all of the information required for
full financial statements and should be read in conjunction with
the audited consolidated financial statements of the Group for the
year ended 31 March 2022.
The financial information for the six months ended 30 September
2022 and the comparative figures for the six months ended 30
September 2021 are unaudited. They have been prepared on the basis
of the accounting policies set out in the consolidated financial
statements of the Group for the year ended 31 March 2022 and, on
the recognition, and measurement principles of IFRS in issue as
effective at 30 September 2022. The accounting policies have been
applied consistently throughout the Group for the purposes of
preparation of these condensed consolidated interim financial
statements.
The figures for the year ended 31 March 2022 have been extracted
from the audited statutory accounts which were approved by the
Board of Directors on 8 July 2022, prepared under IFRS. The
Independent Auditor's Report on the Report and Financial Statements
for the year ended 31 March 2022 was unqualified but did draw
attention to Note 1 of those financial statements which explains
that the Group and Parent Company's ability to continue as a going
concern is dependent on the execution of its business plan together
with its ability to raise sufficient capital to meet capital and
liquidity requirements. The auditors report did not contain any
statements under sections 498(2) or 498(3) of the Companies Act
2006.
These condensed consolidated interim financial statements were
approved for issue by the Board of Directors on 9 December
2022.
Going concern
The 2022 Annual Report audit report drew attention to the
material uncertainty relating to going concern as follows:
"We draw attention to the going concern accounting policy in
note 1 of the financial statements, which states that the RUA Life
Sciences Group is loss-making and cash-consumptive, and its revenue
streams have been impacted by the COVID-19 pandemic and the
resulting macro-economic uncertainty and the setback of a
regulatory delay for the Vascular Graft Range. These events and
conditions may result in lower than forecasted revenues and
increased costs associated with the regulatory delay. This
increases the risk that the group will not be able to execute its
business plan, which could adversely impact its ability to generate
profit or raise sufficient capital to meet capital and liquidity
requirements. As stated in note 1, these events or conditions,
together with the requirement for financing indicate that a
material uncertainty exists that may cast significant doubt on the
company's ability to continue as a going concern. Our opinion is
not modified in respect of this matter."
The Board and management have prepared and reviewed financial
forecasts and cashflow requirements. The review included key
assumptions, sensitivities, and contingency plans to cover
eventualities, including the associated cash flow projections. The
review has been updated and also taken into consideration the
potential impact of changing market conditions and other risks and
uncertainty, paying particular attention to the impact of potential
delays in the regulatory process of our Vascular grafts.
The Directors concluded that given the combination of the cash
balance of GBP2.5m at 30 September 2022 and the forecast monthly
cash utilisation, the Group has sufficient liquidity throughout a
period of at least 12 months from the date of approval of this
interim financial report.
As a result, the Directors have a reasonable expectation that
the Group as a whole has adequate resources to continue in
operational existence for a period of at least 12 months from the
date of this interim financial report. For this reason, they
continue to adopt the going concern basis in preparing the
unaudited interim report for the half year ended 30 September
2022.
The financial statements do not include any adjustments that
would be necessary if the group or company was unable to continue
as a going concern.
Principal Risks and Uncertainties
The principal risks and uncertainties affecting the business
activities of the Group remain those detailed on pages 19-22 of the
Annual Report 2022, a copy of which is available on the Company's
website www.rualifesciences.com
Loss per share
Loss per share has been calculated on the basis of the result
for the period after tax, divided by the weighted average number of
ordinary shares in issue in the period of 22,184,798. (30 September
2021: 22,184,798 and 31 March 2022: 22,184,798).
2. SEGMENTAL REPORTING
The principal activity of the RUA Life Sciences Group comprise
exploiting the value of its IP & know-how, medical device
contract manufacturing and development of cardiovascular
devices.
Following the acquisition of RUA Medical Devices Ltd and an
internal organisation and reporting review, the Board has decided
the business will report by business unit segments, namely royalty
and license income (Biomaterials), Contract Manufacturing, product
development (Vascular) & product innovation (Structural Heart),
rather than trading entities, which is consistent with both how the
business will be managed and reported internally in the future.
The following analysis by segment is presented in accordance
with IFRS 8 on the basis of those segments whose operating results
are regularly reviewed by the Chief Operating Decision Maker
(considered to be the executive chairman of the board) to assess
performance and make strategic decisions about the allocation of
resources. Segmental results are calculated on an IFRS basis.
A brief description of the segments of the business is as
follows:
-- Biomaterials - Licensor of Elast-Eon(TM) polymers to the
medical device industry.
-- Contract Manufacturing - End-to-end contract developer and
manufacturer of medical devices and implantable fabric
specialist.
-- Vascular - Development and commercialisation of the Group's
Elast-Eon sealed Vascular Graft products.
-- Structural Heart - Development of the Group's tri leaflet
polymeric heart valves.
Operating results which cannot be allocated to an individual
segment are recorded as central and unallocated.
Analysis of revenue by income Unaudited Unaudited Audited
stream
Six months Six months Twelve months
to 30 Sep to 30 Sep to 31 Mar
2022 2021 2022
GBGBP000 GBGBP000 GBGBP000
Biomaterials 187 156 487
Contract Manufacture 917 552 1,138
Vascular - - -
Structural Heart - - -
----------- ----------- --------------
Total 1,104 708 1,625
----------- ----------- --------------
Analysis of revenue by geographical
location Unaudited Unaudited Audited
Six months Six months Twelve months
to 30 Sep to 30 Sep to 31 Mar
2022 2021 2022
GBGBP000 GBGBP000 GBGBP000
Europe 6 43 192
USA 1,072 643 1,379
RoW 26 22 54
----------- ----------- --------------
Total 1,104 708 1,625
----------- ----------- --------------
The Group's revenue for six months to 30 September 2022 is
segmented as follows:
Analysis of revenue by income
stream
Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited
Contract Structural Central
Biomaterials Manufacture Vascular Heart and unallocated Total
GBGBP000 GBGBP000 GBGBP000 GBGBP000 GBGBP000 GBGBP000
Contract Design &
Manufacture of Medical
Devices - 917 - - - 917
Royalty revenue 187 - - - - 187
-------------- ------------- ---------- ----------- ----------------- ----------
Total 187 917 - - - 1,104
-------------- ------------- ---------- ----------- ----------------- ----------
Analysis of revenue by geographical
location
Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited
Contract Structural Central
Biomaterials Manufacture Vascular Heart and unallocated Total
GBGBP000 GBGBP000 GBGBP000 GBGBP000 GBGBP000 GBGBP000
Europe 7 -1 - - - 6
USA 154 918 - - - 1,072
RoW 26 - - - - 26
------------------------ ------------- ---------- ----------- ----------------- ----------
Total 187 917 - - - 1,104
------------------------ ------------- ---------- ----------- ----------------- ----------
Restatement of Analysis of revenue by income stream six month to
30 September 2021 is as follows:
Analysis of revenue by income
stream
Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited
Contract Structural Central
Biomaterials Manufacture Vascular Heart and unallocated Total
GBGBP000 GBGBP000 GBGBP000 GBGBP000 GBGBP000 GBGBP000
Contract Design &
Manufacture of
Medical
Devices - 552 - - - 552
Royalty revenue 156 - - - - 156
-------------- ------------- ---------- ----------- ----------------- ----------
Total 156 552 - - - 708
-------------- ------------- ---------- ----------- ----------------- ----------
Analysis of revenue by geographical
location
Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited
Contract Structural Central
Biomaterials Manufacture Vascular Heart and unallocated Total
GBGBP000 GBGBP000 GBGBP000 GBGBP000 GBGBP000 GBGBP000
Europe - 44 - - - 44
USA 134 508 - - - 642
RoW 22 - - - - 22
---------------------- ------------- ---------- ----------- ----------------- ----------
Total 156 552 - - - 708
---------------------- ------------- ---------- ----------- ----------------- ----------
Segment Analysis for period to 30
September 2022
Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited
Contract Structural Central
Biomaterials Manufacture Vascular Heart and unallocated Total
GBGBP000 GBGBP000 GBGBP000 GBGBP000 GBGBP000 GBGBP000
Consolidated group
revenues from external
customers 187 917 - - - 1,104
Contributions to
group operating loss 154 384 (619) (289) (766) (1,136)
Depreciation - 139 - 8 1 148
Amortisation of intangible
assets - 22 - - 4 26
Segment assets 90 4,012 - 152 2,343 6,597
Segment liabilities 2 897 34 4 174 1,111
Intangible assets
- goodwill - 301 - - - 301
Other intangible
assets - 419 - - 76 495
Additions to non-current
assets - 94 - - - 94
Restatement of Segment Analysis six month to 30 September 2021
is as follows:
Segment Analysis 2021
Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited
Contract Structural Central
Biomaterials Manufacture Vascular Heart and unallocated Total
GBGBP000 GBGBP000 GBGBP000 GBGBP000 GBGBP000 GBGBP000
Consolidated group
revenues from external
customers 156 552 - - - 708
Contributions to
group operating loss 116 79 (532) (317) (652) (1,306)
Depreciation - 117 - - 1 118
Amortisation of intangible
assets - 22 - - 5 27
Segment assets 167 3,763 - 153 4,802 8,885
Segment liabilities 6 1,333 44 26 213 1,622
Intangible assets
- goodwill - 301 - - - 301
Other intangible
assets - 462 - - 85 547
Additions to non-current
assets - 313 - - 84 397
3. GOODWILL
The final valuation following the acquisition of RUA Medical
Devices Limited gave rise to adjustments being required to the
value of intangibles recognised in the Interim Report for the six
months ended 30 September 2020 (as noted in note 5 below), and lead
to the following goodwill being recognised:
No impairment review has been carried out in the six-month
period.
GBGBP000
Gross carrying amount
Balance at 31 March 2021 301
Balance at 31 March 2022 301
-----------------
Balance at 30 September
2022 301
-----------------
4. INTANGIBLE ASSETS
Development Intellectual Customer Technology
costs property related based Total
Gross carrying amount
At 31 March 2021 337 3,325 247 141 4,050
At 30 September
2021 337 3,325 247 141 4,050
At 31 March 2022 337 3,325 247 141 4,050
At 30 September
2022 337 3,325 247 141 4,050
----------- ------------ -------- ---------- -----
Amortisation and
impairment
At 31 March 2021 334 3,099 29 14 3,476
Charge for the period 2 4 14 7 27
----------- ------------ -------- ---------- -----
At 30 September
2021 336 3,103 43 21 3,503
Charge for the period 1 3 15 7 26
----------- ------------ -------- ---------- -----
At 31 March 2022 337 3,106 58 28 3,529
Charge for the period - 4 15 7 26
----------- ------------ -------- ---------- -----
At 30 September
2022 337 3,110 73 35 3,555
----------- ------------ -------- ---------- -----
Net book value
At 30 September 2021 1 222 204 120 547
----------- ------------ -------- ---------- -----
At 31 March 2022 - 219 189 113 521
----------- ------------ -------- ---------- -----
At 30 September
2022 - 215 174 106 495
----------- ------------ -------- ---------- -----
5. PROPERTY, PLANT AND EQUIPMENT
Land & Plant Office Motor Total
Buildings & Machinery Equipment Vehicles
GBGBP000 GBGBP000 GBGBP000 GBGBP000 GBGBP000
Cost
At 31 March 2021 944 1,114 63 28 2,149
Additions 28 361 8 - 397
----------- ------------- ----------- ---------- ---------
At 30 September 2021 972 1,475 71 28 2,546
Additions 363 139 8 (3) 507
At 31 March 2022 1,335 1,614 79 25 3,053
Additions - 80 14 - 94
At 30 September 2022 1,335 1,694 93 25 3,147
----------- ------------- ----------- ---------- ---------
Depreciation
At 31 March 2021 58 112 18 9 197
Charge 29 79 7 3 118
----------- ------------- ----------- ---------- ---------
At 30 September 2021 87 191 25 12 315
Charge 33 96 8 4 141
At 31 March 2022 120 287 33 16 456
Charge 30 106 8 4 148
At 30 September 2022 150 393 41 20 604
----------- ------------- ----------- ---------- ---------
Net book value
At 30 September 2021 885 1,284 46 16 2,231
----------- ------------- ----------- ---------- ---------
At 31 March 2022 1,215 1,327 46 9 2,597
----------- ------------- ----------- ---------- ---------
At 30 September 2022 1,185 1,301 52 5 2,543
----------- ------------- ----------- ---------- ---------
Included in the net carrying amount of property plant and
equipment are right-of-use assets as follows:
30 September
2022
GBGBP000
Plant & Machinery 131
Motor vehicles 5
-------------
Total right-of-use
assets 136
-------------
7. ISSUED SHARE CAPITAL
The Company's issued share capital at 30 September 2022
comprises 22,184,798 Ordinary Shares of which none are held in
treasury.
8. INTERIM ANNOUNCEMENT
The interim results announcement was released on 12 December
2022. A copy of this Interim Report is also available on the
Company's website www.rualifesciences.com.
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END
IR BKDBBOBDDKBD
(END) Dow Jones Newswires
December 12, 2022 02:00 ET (07:00 GMT)
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