TIDMIXI
RNS Number : 6508Z
IXICO plc
25 May 2021
IXICO plc
("IXICO", the "Company" or the "Group")
Half yearly report to 31 March 2021
8% revenue growth, 18% EBITDA margin
GBP7.0m cash
GBP19.0m order book(1) at 31 March 2021 reflecting contract wins
across the period
IXICO plc (AIM: IXI), the AI data analytics company delivering
insights in neuroscience, announces its unaudited interim results
for the six months ended 31 March 2021.
IXICO's proprietary AI technology increases the utility and
value of brain imaging and digital biomarker data and supports
pharmaceutical and biotech clients to obtain more information from
their neurological disease clinical development programmes.
Financial highlights
-- Reported revenues of GBP4.9 million for the six months to 31
March 2021 (H1 2020: GBP4.6m) representing 8% growth;
-- Continued strong gross margin at 67.6% (H1 2020: 66.5%);
-- Growth in earnings before interest, taxation, depreciation
and amortisation ('EBITDA') to GBP0.9 million (H1 2020:
GBP0.7m);
-- EBITDA margin at 18.0% (H1 2020: 14.8%);
-- Cash position of GBP7.0 million as of 31 March 2021 (H1 2020: GBP6.7m); and
-- Profit per share of 1.78p (H1 2020: 1.01p)
Commercial and operational highlights
-- Order book(1) of GBP19.0 million at 31 March 2021 (H1 2020:
GBP15.3m) despite reduction relating to Phase III and OLE HD trail
failures as announced 23 March 2021;
-- GBP9.4 million of new contracts signed during the period
across a range of clients and neurological therapeutic
indications;
-- Significant capital investment in next generation image
capture and analysis platform and associated partnership with
Microsoft; and
-- Research and Development investments in expanded range of
analytical tools to support advanced quantitative image
analysis.
Corporate development highlights
-- Increased focus on corporate development and strategic
partnership opportunities within Central Nervous System ('CNS')
indications across medical imaging and emerging digital health
technologies.
(1) Order book is contracted but unrecognised revenue adjusted
down to provide the Company's best expectations of delivery.
Giulio Cerroni, CEO of IXICO, commented: "Despite the ongoing
COVID-19 pandemic, this is another strong set of financial results
and I am particular pleased with the continued top line revenue
growth and acquisition of new clients reported through the period.
The CNS clinical trials market is showing the green shoots of
recovery and IXICO's technology-driven business model is well
suited to support our pharma and biotech clients as they
increasingly look to accelerate their adoption of remote data
collection technologies. I am pleased, not only in the progress of
our client traction across the last six months, but also in the
operational progress we have made through investments to ensure we
can scale to meet the demands of our growing marketplace.
"Whilst we expect to see the impact of clinical trial delays and
of the recent loss of revenues from our order book following the
client trial failure announced in March, we remain confident of our
ability to grow across the medium to long term. This conviction is
underpinned by increasing numbers of discussions with a wider range
of clients for our specialist neuroimaging services, across a
broader range of CNS therapeutic indications and potential
strategic partnerships in emerging digital health
technologies."
A recording of the results presentation will be made available
on the Group's website here:
https://ixico.com/investors/company-information/investor-videos/
For further information please contact:
IXICO plc +44 (0)20 3763 7498
Giulio Cerroni, Chief Executive Officer
Grant Nash, Chief Financial Officer
Cenkos Securities PLC (Nominated adviser
and sole broker) +44 (0)20 7397 8900
Giles Balleny / Max Gould (Corporate
Finance)
Michael F Johnson / Russell Kerr
(Sales)
Walbrook PR Ltd Tel: 020 7933 8780 or IXICO@walbrookpr.com
Paul McManus / Lianne Cawthorne / Mob: 07980 541 893 / 07584 391 303
Alice Woodings / 07407 804 654
About IXICO
IXICO is dedicated to delivering insights in neuroscience. Our
mission is to transform the progression of our biopharmaceutical
clients' neurological therapeutic pipelines through the application
of novel imaging and digital biomarkers.
IXICO's data analytics services are used by the global
biopharmaceutical industry to interpret data from brain scans and
digital biosensors to enable better trial design, site
qualification, patient selection and clinical outcomes. We provide
technology-enabled services across all phases of clinical
evaluation. Our integrated digital platform provides a scalable and
secure infrastructure for the capture and analysis of regulatory
compliant clinical data to enable clients to make rapid, better
informed decisions. IXICO is also collaborating with partners to
develop new analytical techniques and digital health products
targeted at improving patient outcomes.
More information is available on www.IXICO.com
CHIEF EXECUTIVE OFFICER'S STATEMENT
Statement from Giulio Cerroni
Across the past six months, we have reported revenues of GBP4.9
million, representing 8% growth compared to the same period of the
prior year. As at 31 March 2021, our contracted order book totalled
GBP19.0 million (H1 2020: GBP15.3 million), which I am particularly
pleased with, considering the reduction of revenues reflected in
the order book relating to our largest client's Huntington disease
('HD') trial following its failure, as announced on 23 March
2021.
This revenue growth has supported the delivery of EBITDA of
GBP0.9 million for the half-year period, reflecting further
accretion in our EBITDA margin to 18% (H1 2020: GBP0.7 million and
14.8%). This strong performance has been driven by continued
commercial momentum of the Group's technology services, which
enable the pharmaceutical industry to derive valuable insights from
their neuroscience clinical development programmes. This is
particularly pleasing when considered alongside the diversification
of our order book and broader reach across neuroscience therapeutic
indications.
The Group has encountered headwinds in its progression during
the period because of the descope of our largest client's Phase 3
and open label HD trials. These, along with the ongoing impact of
COVID-19, mean we anticipate a levelling off of growth across the
next eighteen months. Whilst we continue to hold a strong order
book, it does reflect a reduction in near term revenues expected
compared to the prior year. Positively, this also reflects the
gradual transition within our order book to a broader
diversification of clients. We anticipate this rebalancing, which
has increased the relative proportion of early-stage trials in our
order book, to underpin our ability to achieve medium- and
longer-term growth with a reduced risk profile associated with the
early termination of a trial. As the market responds to an easing
of COVID restrictions and continues to benefit from underlying
growth drivers, we anticipate a continued uptick in the rate of
signing new trials as has been achieved across the last six
months.
In the period we have further accelerated our programs of
investment, specifically in our Microsoft Azure cloud-based image
capture and analysis platform, which we expect to launch during
2022. In addition to this, we have broadened our analytical
offerings across neurological indications and invested in our
operational structures and processes. These investments are all
focussed on scaling the business to ensure the Group maximises the
growth opportunity available to us.
We have continued to invest in our digital biomarkers offering
and pursue a strategy of both organic, and where the appropriate
opportunity arises, inorganic growth in this developing field. We
believe that the COVID-19 pandemic will prove to be a propulsive
force for digital adoption in clinical trials and we see digital
health technologies (wearables in particular) as highly
complementary to our imaging offering to CNS clinical trials. We
consider recent consolidation in the market as a reflection of the
increasing imperative to install these important technologies which
support a more decentralised and remote based trial model.
Looking forward to the second half of the year, we retain our
focus on the business fundamentals of winning new contracts, across
a diverse client base and an increasing breadth of neuroscience
indications. We are, by strategic intent, a neuroscience specialist
and our investments are accordingly entirely focussed on ensuring
we offer the best possible services to our clients in this
field.
The Group is well-capitalised, debt-free and profitable with a
cash balance of GBP7.0 million as at 31 March 2021. As a result, we
can look forward with confidence, knowing that we have built a
resilient business model well placed for growth. Our priority
remains ensuring delivery of the best possible services to our
clients as the industry adjusts to new ways of working and, in so
doing, maximise value for all our stakeholders.
Financial Review
KPI H1-21 H1-20 Movement FY20 FY19
--------------------- ------------- ------------- --------------------- ------------ ------------
Revenue GBP4.9m GBP4.6m 7.9% á GBP9.5m GBP7.6m
Gross profit GBP3.3m GBP3.0m 9.7% á GBP6.3m GBP4.9m
Gross margin 67.6% 66.5% 1.2% á 66.6% 65.4%
EBITDA profit GBP0.9m GBP0.7m GBP0.2m á GBP1.3m GBP0.5m
EBITDA margin 18.0% 14.8% 3.2% á 13.6% 6.3%
Operating profit GBP0.6m GBP0.5m GBP0.1m á GBP0.9m GBP0.4m
/ (loss)
Profit / (loss) per
share 1.78p 1.01p 0.77p á 2.02p 0.92p
Orderbook (1) GBP19.0m GBP15.3m GBP3.7m á GBP21.7m GBP15.9m
Cash GBP7.0m GBP6.7m GBP0.3m á GBP7.9m GBP7.3m
Revenue per FTE (2) GBP103k GBP123k GBP20k â GBP122k GBP124k
--------------------- ------------- ------------- ---------- --------- ------------ ------------
Orderbook is contracted but not yet recognised revenue adjusted down
(1 to reflect the Company's best estimate of delivery.
2) Revenue per FTE for the interim periods are annualised
Revenue
-- Revenue of GBP4.9 million (H1 2020: GBP4.6m) representing a 7.9% increase on prior period.
-- Robust order book of GBP19.0 million (H1 2020: GBP15.3m)
despite reduction of GBP7.1m revenues from trial cessations in the
period.
Gross profit and margin
-- Gross profit growth of GBP0.3 million to GBP3.3 million (H1
2020: GBP3.0m) with a marginal increase in gross margin to 67.6%
from 66.5%
Operating expenses
-- Operating expenditure remained consistent at GBP2.9 million
(H1 2020: GBP2.9m), representing management's ability to maintain a
consistent cost base whilst growing the revenues of the
Company.
-- Capitalised R&D expenditure increased in the period to
GBP0.5 million (H1 2020: GBP0.1m), demonstrating the Company's
commitment to continued investment in building scale and
capabilities to drive growth.
EBITDA and operating profit
-- Growth in EBITDA to GBP0.9 million (H1 2020: GBP0.7m),
reflecting the increase in revenue and gross margin and accessing
additional operational leverage via growth.
-- Growth in operating profit to GBP0.6 million (H1 2020:
GBP0.5m), reflecting EBITDA growth partially offset by increased
depreciation and amortisation arising from increased capital
investment as the Group positions itself for future growth
opportunities.
Cash
-- Increase in closing position of GBP7.0 million (H1 2020:
GBP6.7m) reflecting a careful balance between profitability and
investment activities, supported by share issues relating to the
exercise of share options.
-- Operating cash outflow maintained at GBP0.3 million (H1 2020:
GBP0.3m). The operating cash outflow reflects timings of cash in
and out flows resulting from an increased trade receivables
position and reduced trade payables position, which together offset
the positive cash flows derived from a growing EBITDA
performance.
Revenue per FTE
-- Annualised revenue per FTE of GBP103,000 for the period (H1
2020: GBP123,000) reflects continued investment in employees to
further strengthen the operational and scientific capabilities of
the organisation, as well as augmenting the technology team to
develop our next generation image capture and analysis platform.
This reflects the Group's conviction in the opportunity for growth
over the medium- and long-term.
Consolidated Statement of Comprehensive Income
For the six months ended 31 March 2021 - unaudited
31 Mar 21 31 Mar 20 30 Sep 20
6 months 6 months 12 months
Unaudited Unaudited Audited
Notes GBP000 GBP000 GBP000
---------------------------------------------- ------ ---------- ---------- -----------
Revenue 4,913 4,555 9,532
Cost of sales (1,593) (1,528) (3,186)
---------------------------------------------- ------ ---------- ---------- -----------
Gross profit 3,320 3,027 6,346
Other income 224 378 606
Operating expenses
Research and development expenses (650) (631) (1,309)
Sales and marketing expenses (651) (906) (1,579)
General and administrative expenses (1,604) (1,382) (3,208)
Total operating expenses (2,905) (2,919) (6,096)
---------------------------------------------- ------ ---------- ---------- -----------
Operating profit 639 486 856
Finance income 1 17 20
Finance expense (5) (10) (18)
Profit on ordinary activities before
taxation 635 493 858
Taxation 208 (18) 94
---------------------------------------------- ------ ---------- ---------- -----------
Profit attributable to equity holders
for the period 842 475 952
---------------------------------------------- ------ ---------- ---------- -----------
Other comprehensive expense:
Items that will be reclassified subsequently
to profit or loss
Foreign exchange translation differences 9 (13) (1)
---------------------------------------------- ------ ---------- ---------- -----------
Total other comprehensive expense 9 (13) (1)
Total comprehensive income attributable
to equity holders for the period 851 462 951
---------------------------------------------- ------ ---------- ---------- -----------
Profit per share (pence)
---------------------------------------------- ------ ---------- ---------- -----------
Basic profit per share 3 1.78 1.01 2.02
Diluted profit per share 3 1.68 1.00 2.00
---------------------------------------------- ------ ---------- ---------- -----------
Consolidated Statement of Financial Position
As at 31 March 2021 - unaudited
31 Mar 21 31 Mar 20 30 Sep 20
6 months 6 months 12 months
Unaudited Unaudited Audited
Notes GBP000 GBP000 GBP000
------------------------------- ---- ------ ---------- ---------- -----------
Assets
Non-current assets
Property, plant and equipment 1,183 652 1,014
Intangible assets 1,711 395 796
Total non-current assets 2,894 1,047 1,810
Current assets
Trade and other receivables 2,887 2,598 2,082
Current tax receivables 558 273 259
Cash and cash equivalents 7,011 6,664 7,945
------------------------------------- ------ ---------- ---------- -----------
Total current assets 10,456 9,535 10,286
Total assets 13,350 10,582 12,096
------------------------------------- ------ ---------- ---------- -----------
Liabilities and equity
Non-current liabilities
Trade and other payables 159 - 167
Provisions - - 90
Lease liabilities 548 130 45
------------------------------------- ------ ---------- ---------- -----------
Total non-current liabilities 707 130 302
Current liabilities
Trade and other payables 2,050 1,741 2,407
Provisions 175 - 100
Lease liabilities 29 164 168
Total current liabilities 2,254 1,905 2,675
Equity
Ordinary shares 4 480 471 471
Share premium 4 84,802 84,499 84,499
Merger relief reserve 1,480 1,480 1,480
Reverse acquisition reserve (75,308) (75,308) (75,308)
Foreign exchange translation
reserve (88) (94) (97)
Capital redemption reserve 7,456 7,456 7,456
Accumulated losses (8,433) (9,957) (9,382)
------------------------------------- ------ ---------- ---------- -----------
Total equity 10,389 8,547 9,119
Total liabilities and equity 13,350 10,582 12,096
------------------------------------- ------ ---------- ---------- -----------
Consolidated Statement of Changes in Equity
For the six months ended 31 March 2021 - unaudited
Foreign
Merger Reverse exchange Capital
Ordinary Share relief acquisition translation redemption Accumulated
shares premium reserve reserve reserve reserve Losses Total
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
------------------- --------- --------- --------- ------------ ------------ ----------- ------------ ---------
Balance at 30
September 2019 469 84,436 1,480 (75,308) (81) 7,456 (10,533) 7,919
------------------- --------- --------- --------- ------------ ------------ ----------- ------------ ---------
Total
comprehensive
income/(expense)
Profit for the
period - - - - - - 952 952
Other
comprehensive
expense:
Realised losses on
foreign
exchange - - - - (15) - 15 -
Foreign exchange
translation - - - - (1) - - (1)
------------------- --------- --------- --------- ------------ ------------ ----------- ------------ ---------
Total
comprehensive
income/(expense) - - - - (1) - 967 951
Transactions with
owners
Charge in respect
of share
options - - - - - - 184 184
Exercise of share
options 2 63 - - - - - 65
Total transactions
with owners 2 63 - - - - 184 249
Balance at 30
September 2020 471 84,499 1,480 (75,308) (97) 7,456 (9,382) 9,119
------------------- --------- --------- --------- ------------ ------------ ----------- ------------ ---------
Total
comprehensive
income
Profit for the
period - - - - - - 842 842
Other
comprehensive
expense:
Foreign exchange
translation - - - - 9 - - 9
------------------- --------- --------- --------- ------------ ------------ ----------- ------------ ---------
Total
comprehensive
income - - - - 9 - 842 851
Transactions with
owners
Charge in respect
of share
options - - - - - - 107 107
Exercise of share
options 9 303 - - - - - 312
Total transactions
with owners 9 303 - - - - 107 419
Balance at 31
March 2021 480 84,802 1,480 (75,308) (88) 7,456 (8,433) 10,389
------------------- --------- --------- --------- ------------ ------------ ----------- ------------ ---------
Consolidated Statement of Cashflows
For the six months ended 31 March 2021 - unaudited
31 Mar 21 31 Mar 20 30 Sep 20
6 months 6 months 12 months
Unaudited Unaudited Audited
GBP000 GBP000 GBP000
------------------------------------------ ---- ---------- ---------- -----------
Cash flows from operating activities
Profit for the period 842 475 952
Finance income (1) (17) (20)
Finance expense 5 10 18
Taxation (208) 18 (94)
Depreciation of fixed assets 247 152 356
Amortisation of intangibles 50 36 82
Disposal of fixed assets - - 1
Dilapidation provision release (53) - -
Impairment of intangible assets - - 2
Research and development expenditure
credit (92) (91) (162)
Share option charge 107 101 184
897 684 1,319
Changes in working capital
(Increase)/decrease in trade and
other receivables (755) (214) 297
(Decrease)/increase in trade and
other payables (436) (982) (128)
------------------------------------------------ ---------- ---------- -----------
Cash (used in)/generated from operations (294) (512) 1,488
Taxation received - 251 447
------------------------------------------------ ---------- ---------- -----------
Net cash (used in)/generated from
operating activities (294) (261) 1,935
Cash flows from investing activities
Purchase of property, plant and
equipment (36) (203) (686)
Purchase of intangible assets including
staff costs capitalised (877) (101) (456)
Finance income 1 12 20
Net cash used in investing activities (912) (292) (1,122)
Cash flows from financing activities
Issue of shares 312 65 65
Repayment of lease liabilities (44) (89) (177)
Interest paid (5) (10) (18)
Net cash generated from financing
activities 263 (34) (130)
Movements in cash and cash equivalents
in the period (943) (587) 683
------------------------------------------------ ---------- ---------- -----------
Cash and cash equivalents at start
of period 7,945 7,264 7,264
Effect of exchange rate fluctuations
on cash held 9 (13) (2)
------------------------------------------------ ---------- ---------- -----------
Cash and cash equivalents at end
of period 7,011 6,664 7,945
------------------------------------------------ ---------- ---------- -----------
Notes to the financial statements
1. Presentation of the financial statements
a. General information
IXICO plc (the 'Company') is a public limited company
incorporated in England and Wales and is admitted to trading on the
AIM market of the London Stock Exchange under the symbol IXI. The
address of its registered office is 4th Floor, Griffin Court, 15
Long Lane, London EC1A 9PN.
The Company is a parent of a number of subsidiaries, together
referred to throughout as 'the Group'. The Group is an established
provider of technology-enabled services to the global
biopharmaceutical industry. The Group's services are used to select
patients for clinical trials and assess the safety and efficacy of
new drugs in development within the field of neurological
disease.
b. Basis of preparation
The condensed consolidated interim financial statements were
approved by the Board of Directors for issue on 24 May 2021. The
condensed consolidated interim financial statements do not comprise
statutory accounts within the meaning of section 434 of the
Companies Act 2006. The condensed consolidated interim financial
statements together with the comparative information for the six
months ended 31 March 2021 are unaudited.
The statutory accounts of the Company for the year ended 30
September 2020 were approved by the Board of Directors on 1
December 2020 and delivered to the Registrar of Companies. The
report of the auditors on those accounts was unqualified, did not
contain an emphasis of matter paragraph and did not contain any
statement under section 498 of the Companies Act 2006.
The condensed consolidated interim financial statements have
been prepared on a going concern basis and in accordance with IFRS
as adopted by the EU, IFRIC interpretations and the Companies Act
2006 applicable to companies operating under IFRS. They comprise a
Statement of Comprehensive Income, a Statement of Financial
Position, a Statement of Changes in Equity, a Statement of Cash
Flows, and accompanying notes. These financial statements have been
prepared under the historical cost convention modified by the
revaluation of certain financial instruments.
The condensed consolidated interim financial statements are
presented in Great British Pounds ('GBP' or 'GBP') and are rounded
to the nearest thousand unless otherwise stated. This is the
predominant functional currency of the Group, and is the currency
of the primary economic environment in which it operates. Foreign
currency transactions are accounted for in accordance with the
policies set out below.
c. Basis of consolidation
The condensed consolidated interim financial statements
incorporate the accounts of the Company and its subsidiary
companies adjusted to eliminate intra-Group balances and any
unrealised gains and losses or income and expenses arising from
intra-Group transactions. When necessary, adjustments are made to
the financial statements of subsidiaries to bring their accounting
policies into line with the Group's accounting policies.
The Group controls a subsidiary when the Group is exposed to, or
has rights to, variable returns from its involvement with a
subsidiary and has the ability to affect those returns through its
power over a subsidiary. In assessing control, potential voting
rights that are currently exercisable or convertible are taken into
account.
The results of subsidiary companies are included in the
condensed consolidated financial statements from the date that
control commences until the date that control ceases. The assets
and liabilities of foreign operations are translated into GBP at
exchange rates prevailing at the end of the reporting period.
Income statements and cash flows of foreign operations are
translated into GBP at average monthly exchange rates which
approximate foreign exchange rates at the date of the transaction.
Foreign exchange differences arising on retranslation are
recognised directly in a separate translation reserve.
d. Going concern
At the time of approving the condensed consolidated financial
statements, the Directors have considered the expected future
performance together with the Group's estimated future cash inflows
from existing long-term contracts and sales pipeline.
The ongoing COVID-19 pandemic continues to cause uncertainty
across global markets for the short and medium term. During 2020,
the Group reacted quickly to this by preparing a series of
financial scenario forecasts based on discussions with clients over
the likely impact of the pandemic on their clinical trials. In
parallel the Group moved rapidly to a fully remote model, which
included providing additional equipment to employees enabling all
to work from home effectively and allowing the Group to trade
uninterrupted throughout the year.
In assessing going concern, management prepare forecasts which
are updated monthly that consider different scenarios throughout
the course of the financial year, as well as ad-hoc forecasts that
extend into future years. These include the risk to current
projects and expected future sales pipelines, the ability for
patients to attend imaging centres (due to global COVID-19 lockdown
restrictions) and potential delays in new trial start-up timelines.
The Directors have considered these forecasts, alongside the
Group's strong balance sheet and cash balance as well as the
ability for the Group to mitigate costs if necessary.
After due consideration of these forecasts, the Directors
concluded with confidence that the Group has adequate financial
resources to continue in operation for the foreseeable future.
2. Significant accounting policies, judgements, and estimation uncertainty
The unaudited condensed consolidated interim financial
statements have been prepared using the accounting policies as
described in the 30 September 2020 audited year end Annual Report
and have been consistently applied.
When preparing the condensed consolidated interim financial
statements, the Directors make a number of judgements, estimates
and assumptions about the recognition and measurement of assets,
liabilities, income and expenses.
Significant management judgements
The following are significant management judgements in applying
the accounting policies of the Group that have the most significant
effect on the condensed consolidated interim financial
statements.
Revenue recognition
The Group recognises revenue in accordance with amounts charged
to clients under service contracts. All contracts include an
agreed, detailed work order which defines the deliverables. The
service contracts are typically multi-year and may be amended
through a change order process, which may include changes to data
volumes (increased or decreased), different methods of data
analysis or changes to the timing of providing the
deliverables.
Revenue is recognised upon achievement of deliverables set out
in the service contract. The recognition is expected to approximate
to the timing of the physical performance of the contracts. The
Group records the performance of the contractual obligations to
determine that the deliverables and actual work performed is in
accordance with the contract and agreed change orders. The scope of
the project and contract terms are reviewed to determine whether
the Group is acting as principal or agent in respect of the
project, which depends on facts and circumstances and requires
judgement.
Client contracts include an agreed work order so the transaction
price for a contract is allocated against distinct performance
obligations based on their relative stand-alone selling prices.
Management determines the fair value of individual components based
on actual amounts charged by the Group on a stand-alone basis. The
transaction price for a contract excludes any amounts collected on
behalf of third parties.
Capitalisation of internally developed software
Distinguishing the research and development phases of a new
software product and determining whether the requirements for the
capitalisation of development costs are met requires judgement.
Management will assess whether a project meets the recognition
criteria as set out in IAS 38 based on an individual project basis.
Where the criteria are not met, the research and development
expenditure will be expensed in the Consolidated Statement of
Comprehensive Income. Where the recognition criteria are met, the
items will be capitalised as an intangible asset.
During the period ended 31 March 2021, total research and
development expenses totalled GBP1,136,000 (2020: GBP711,000). Of
this amount, GBP486,000 (2020: GBP80,000) was capitalised as an
intangible asset. The balance of expenditure being GBP650,000
(2020: GBP631,000) is recognised in the Consolidated Statement of
Comprehensive Income as an expense.
Recovery of deferred tax assets
Deferred tax assets have not been recognised for deductible
temporary differences and tax losses. The Directors consider that
there is not sufficient certainty that future taxable profits will
be available to utilise those temporary differences and tax
losses.
Estimation uncertainty
Information about estimates and assumptions that have the most
significant effect on recognition and measurement of assets,
liabilities, income and expenses is provided below. Changes to
these estimations may result in substantially different results for
the year.
Share-based payments
The Group measures the cost of equity-settled transactions with
employees by reference to the fair value of the equity instruments
at the date at which they are granted. The fair value of the
options granted is measured using an option valuation model, taking
into account the terms and conditions upon which the options were
granted.
Useful lives of depreciable assets
The useful lives of depreciable assets are determined by
management at the date of purchase based on the expected useful
lives of the assets. These are subsequently monitored and reviewed
annually and where there is objective evidence of changes in the
useful economic lives, these estimates are adjusted. Any changes to
these estimates may result in significantly different results for
the period.
Provisions
The amounts included in both long- and short-term provisions are
based on estimates provided by professionals relevant to the
field
the provision relates. These were reviewed by management and are
considered to be a reasonable estimate of the expected cost of
fulfilling these provisions.
3. Earnings per share
The calculation of basic and diluted earnings per share ('EPS')
of the Group is based on the following data:
31 Mar 21 31 Mar 20 30 Sep 20
6 months 6 months 12 months
Unaudited Unaudited Audited
Earnings
Earnings for the purposes of basic and
diluted EPS, being net profit attributable
to the owners of the Company (GBP000) 842 475 952
Number of shares
Weighted average number of shares for the
purposes of basic EPS 47,259,617 46,981,814 47,036,398
Effect of potentially dilutive ordinary
shares:
* Weighted average number of share options 2,950,951 701,770 513,521
Weighted average number of shares for the
purposes of diluted EPS 50,210,568 47,683,584 47,549,919
Basic earnings per share is calculated by dividing earnings
attributable to the owners of the Company by the weighted average
number of shares in issue during the year. The diluted EPS is
calculated by dividing earnings attributable to the owners of the
Company by the weighted average number of shares in issue taking
into account the share options outstanding during the year.
The basic and diluted earnings per share for the Group and
Company is:
31 Mar 31 Mar 30 Sep
21 20 20
6 months 6 months 12 months
Unaudited Unaudited Audited
---------------------------- ---------- ---------- -----------
Basic earnings per share 1.78 1.01p 2.02p
Diluted earnings per share 1.68 1.00p 2.00p
4. Issued capital and reserves
Ordinary shares and share premium
The Company has one class of ordinary shares. The share capital
issued has a nominal value of GBP0.01 and all carry the right to
one vote at shareholders' meetings and are eligible to receive
dividends. Share premium is recognised when the amount paid for a
share is in excess of the nominal value.
The Group and Company's opening and closing share capital and
share premium reserves are:
Group and Company
Ordinary Share Share
shares capital premium
Number GBP000 GBP000
----------------------------------- ----------- -------- --------
Authorised, issued and fully paid
At 30 September 2020 47,091,292 471 84,499
Share options exercised 878,229 9 303
At 31 March 2021 47,969,521 480 84,802
----------------------------------- ----------- -------- --------
Exercise of share options
During the period, the following share options were
exercised:
Key management Other Exercise
personnel Employees Total price Value
Date of exercise Shares Shares Shares Pence GBP000
------------------ --------------- ----------- -------- --------- -------
7 January 2021 - 10,039 10,039 49.0 5
7 January 2021 - 25,098 25,098 30.5 8
7 January 2021 - 10,039 10,039 36.5 4
5 February 2021 112,942 - 112,942 30.5 34
5 February 2021 43,529 - 43,529 34.0 15
4 March 2021 676,582 - 676,582 36.5 246
Total 833,053 45,176 878,229 - 312
------------------ --------------- ----------- -------- --------- -------
This resulted in an increase in share capital of GBP8,782 and an
increase in share premium of GBP303,656.
5. Share-based payments
Certain Directors and employees of the Group hold options to
subscribe for shares in the Company under share option schemes.
There are 2 distinct structures to the share options in operation
in the Group (2020: 2). Both structures relate to a single scheme
outlined in the EMI Share Option Plan 2014.
The scheme is open, by invitation, to both Executive Directors
and employees. Participants are granted share options in the
Company which contain vesting conditions. These are subject to the
achievement of individual employee and Group performance criteria
as determined by the Board. The vesting period varies by award and
the conditions approved by the Board. Options are usually forfeited
if the employee leaves the Group before the options vest.
Total share options outstanding have a range of exercise prices
from GBP0.01 to GBP0.70 per option and the weighted average
contractual life is 3.1 years (2020: 4.1 years). The total charge
for each period relating to employee share-based payment plans for
continuing operations is GBP107,000 (2020: GBP101,000).
Details of the share options under the scheme outstanding during
the period are as follows:
As at 31 March 2021 As at 30 September 2020
--------------------------- ----------------------------- -------------------------------
Number Weighted average Number Weighted average
exercise price exercise price
Outstanding at start of
the period 4,438,511 GBP0.17 3,690,572 GBP0.18
Granted - - 1,990,000 GBP0.17
Exercised (878,229) GBP0.36 (188,998) GBP0.34
Lapsed - - (1,053,063) GBP0.17
--------------------------- ----------
Outstanding at end of the
period 3,560,282 GBP0.13 4,438,511 GBP0.17
Exercisable at end of the
period 277,852 GBP0.36 1,118,581 GBP0.36
--------------------------- ---------- ----------------- ------------ -----------------
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END
IR DZLFLFELZBBF
(END) Dow Jones Newswires
May 25, 2021 02:00 ET (06:00 GMT)
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