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RNS Number : 2848N
MyHealthChecked PLC
29 September 2021
MyHealthChecked Plc
("MyHealthChecked", "MHC" or the "Company")
Half-year Report
MyHealthChecked Plc, the consumer home-testing healthcare
company, announces its unaudited half year report for the six
months ended 30 June 2021, a period of considerable growth driven
by a dramatic ramp-up in COVID-19 PCR testing service revenues.
The Company also provides an update on further strong trading in
Q3 (revenues of at least GBP8.5m, adjusted EBITDA* of no less than
GBP1.4m, and cash generative for the first time) as well as a
statement on trading outlook for the full year.
Commercial Highlights
-- Signed two commercial agreements with Boots UK Limited for
supply of COVID-19 PCR test kits and associated laboratory
services
-- Signed a commercial agreement with AAH Pharmaceuticals
Limited (Lloyds Pharmacy) for supply of COVID-19 PCR test kits and
associated laboratory services
-- Acquisition and integration of Nell Health Limited, a
provider of genetic testing and personalized nutrition
consultancy
-- Accreditation by UKAS of ISO 15189 stage 3
Financial Position
-- Revenue of GBP3,274,145 during the period (H1 2020: GBP12,707)
-- Adjusted EBITDA* loss of -GBP199,670 (H1 2020 : loss of -GBP1,171,359)
-- Completion of share placing of GBP3.4m (before expenses) at 1.75p per share in Feb 2021
-- Cash balance at the period end was GBP2,214,496 (H1 2020 : GBP1,351,745)
*adjusted EBITDA is Operating profit adjusted for depreciation,
amortisation and share based payments
Penny McCormick, Chief Executive Officer of MyHealthChecked Plc,
said: "I'm incredibly proud of the progress the Company has made
during the last six months. We have secured commercial contracts
with both of the UK's top pharmacy retailers, ending H1 2021 with a
strong cash position and significantly increased revenues compared
to H1 2020.
"We continue to grow as an organisation and with our talented
team, which has been enhanced through the acquisition of Nell
Health, I look forward to seeing the Company go from strength to
strength in H2. While COVID-19 has been the predominant focus for
us during the last 12 months, I am excited to continue development
of our extended product pipline to market and continue to build
MyHealthChecked's reputation for high-quality products and
services."
MyHealthChecked plc www.myhealthchecked.com
P enny McCormick , Chief Executive via Walbrook PR
Officer
Gareth Davies, Chief Financial and
Operations Officer
SPARK Advisory Partners Limited (NOMAD) Tel: +44 (0)20 3368 3550
Neil Baldwin
Oberon Capital Ltd (Broker) Tel: +44 (0)203 179 5344
Mike Seabrook mikeseabrook@oberoninvestments.com
Walbrook PR Ltd (Media & Tel: +44 (0)20 7933 8780 or myhealthcheckedplc@walbrookpr.com
IR)
Paul McManus / Alice Woodings Mob: +44(0)7980 541 893 / +44 (0)7407
804 654
About MyHealthChecked PLC ( www.myhealthcheckedplc.com )
MyHealthChecked PLC, based in Cardiff, is an AIM-quoted
pioneering UK healthcare company focused on a range of at-home
healthcare and wellness tests.
MyHealthChecked is the umbrella brand of a range of at-home DNA
and RNA tests, now in development following the acquisition of The
Genome Store in November 2020. The tests will be made available
online, and would be viable for over the counter purchase.
The MyHealthChecked portfolio has been identified as part of a
change in mindset as customers become more familiar with the
concept of accessible healthcare in the growing at home testing kit
market with a focus on accessibility at the right price, led by
UK-based experts.
Chairman & CEO Joint Statement
Overview
The Company reports a strong performance this year, having made
significant progress since the launch of its COVID-19 PCR testing
service in December 2020.
Trading for the year began to ramp up in Q2 following the
signing of a contract with Boots UK Limited, the UK's largest
pharmacy retailer, and launch on 17 April, followed by a second
contract and the launch of the Day 2 and 8 COVID-19 testing service
on 7 May. Subsequently a contract has been signed with Lloyds
Pharmacy, the UK's second largest pharmacy retailer for supply of
COVID-19 PCR test kits and associated laboratory services .
The Board is confident that trading for the full year will
deliver performance in H2 considerably higher than H1, due to the
continued high demand through the peak holiday period during the
summer months in Q3. Beyond the period, MHC is well placed with its
established customer base to continue to supply a good proportion
of the COVID-19 testing market, whilst factoring recent Government
changes to COVID-19 testing requirements for travellers to the UK
announced in mid-September 2021.
The Board expects that revenue generated in Q3 to be at least
GBP8.5m and deliver an adjusted EBITDA profit for the quarter of no
less than GBP1.4m. The business will be cash generative in the
quarter and expects cash balances to be at least GBP3.4m at the end
of Q3.
However it is too early to fully assess the effect of the recent
changes to the Government COVID-19 testing requirements as we move
into the quieter fourth quarter of this financial year, therefore
given this uncertainty the Company is not making a forecast for
either revenue or profitability for Q4 at this time.
We have made progress in the following key areas in 2021:
Commercial Relationships
During the past 6 months we have secured contracts with both of
the UK's top pharmacy retailers, Boots and Lloyds. Following robust
due diligence processes and collaboration for successful on-time
launches, we have worked to build supportive relationships with
both of our primary customers. Whilst the relationships are still
in their early stages, we are building upon our reputation within
these key organisations daily and are well positioned to
collaborate further both inside and out of the COVID-19 testing
arena.
Outside of retail, we have worked with several smaller accounts
to deliver a first class COVID-19 testing service. This has
included partners within the independent pharmacy, travel and media
production industries and academia.
Personalised Wellness Tests
We completed a second acquisition in July 2021 - Nell Health
Limited - which brought to us a broader range of validated
saliva-based DNA tests. Our pipeline is defined and is currently in
development. We will accelerate our developments at every
opportunity, ensuring our talent and operation is sourced to
deliver to the most efficient timeline.
Technology
Following the acquisition of Nell Health Limited, MHC has the
ability to create innovative technology in-house, that is secure,
adaptable, and robust for future product and service developments.
In 2021 we have developed a new scalable platform customer facing
e-commerce platform and Laboratory Information Management System
that will house our future portfolio, and we transitioned our core
business across to this.
Capital Expenditure on facilities
We have invested in building a UKAS approved ISO-15189 facility
in Manchester, offering COVID-19 testing services to customers
including same day turnaround.
Cash position
Following the completion of an equity raise in February 2021, we
are pleased to report a GBP2.21m cash position at 30 June 2021 and
report no material borrowings. These funds will be reinvested in
2021 into the talent and pipeline of the organisation, priming us
for new market launches in 2022.
Strategy in 2022
There is a likelihood that due to the nature of the COVID-19
virus, private testing could continue into 2022, and whilst the
Company will continue to deliver to its retail and consumer market,
it is firmly focused on re-investing earnings generated in 2021
into its new product pipeline of at-home wellness tests, and
long-term growth drivers including a Smartphone App, and
wellness-enhancing customer education. Building upon the
foundations laid this year and the reputation that has been built
in the consumer and retail testing spaces, investment in the
MyHealthChecked brand and marketing will aim to further maximise
reach through the creation of an ownable, identifiable and
desirable consumer brand.
Whilst delivering our new product pipeline development and
building digital healthcare-centric technology that is scalable, we
will continue to operate efficiently due to the unpredictability of
the COVID-19 space, whilst maximising future value through our
investment in 2021 earnings into long-term growth drivers including
technology, talent, and commercialisation.
Our aims in 2022 are to:
-- Launch an initial portfolio of at home wellness tests,
providing indications around weight management, vitamin deficiency,
food intolerances, heart health and blood glucose
-- Develop app technology that provides actionable health and
nutritional guidance that is tailored to the customer
-- Execute a business development strategy across direct to consumer, retail, and B2B channels
-- Continue to build a reputation in the COVID-19 testing space,
providing a high-quality product and service
-- Bring additional talent into the organisation to deliver on our ambitious plans
-- Continue to explore third party technology that may enhance
the customer journey and value of our products, and that can be
integrated by our in-house talent
-- Identify and assess complementary earnings-enhancing
partnerships with organizations that demonstrate the addition of
key strategic value to our core business
We would like to thank our team, Board members and investors for
their ongoing support of MyHealthChecked through this period of
2021. Whilst we have transitioned the organisation, we are
delighted to be able to share a very positive set of results, and
demonstrate our commitment to building a successful and secure
business to the loyal team and investor base through this new and
exciting growth phase of the organisation.
Adam Reynolds Penny McCormick
Chairman Chief Executive Officer
29 September 2021
Consolidated statement of comprehensive income
For the 6 months ended 30 June 2021
Audited
Unaudited Unaudited 12 months
6 months to 6 months to to
31 December
30 June 2021 30 June 2020 2020
Notes GBP GBP GBP
-------------------------------- ------ ------------- -------------- ------------
Revenue 3 3,274,145 12,707 49,480
Cost of sales (2,174,271) (174,067) (689,782)
Gross profit / (loss) 1,099,874 (161,360) (640,302)
Other administrative expenses (1,299,544) (1,009,999) (2,857,308)
Depreciation and amortisation (60,677) (100,989) (157,169)
Share-based payments (6,593) (74,553) (103,290)
-------------------------------- ------ ------------- -------------- ------------
Administrative expenses (1,366,814) (1,185,541) (3,117,767)
-------------------------------- ------ ------------- -------------- ------------
Operating loss (266,940) (1,346,901) (3,758,069)
Finance expenses (1,782) (1,981) (4,558)
-------------------------------- ------ ------------- -------------- ------------
Loss before income tax (268,722) (1,348,882) (3,762,627)
Tax credit 5 - - -
Loss for the period (268,722) (1,348,882) (3,762,627)
-------------------------------- ------ ------------- -------------- ------------
Attributable to owners
of the parent: (268,722) (1,348,882) (3,762,627)
Loss per ordinary share
- basic and diluted (pence) 4 (0.04) (0.39) (0.89)
Consolidated statement of financial position
As at 30 June 2021
Unaudited Audited
30 June Unaudited 31 December
2021 30 June 2020 2020
GBP GBP GBP
------------------------------- ------------- -------------- -------------
Non-current assets
Property, plant and equipment 151,774 70,185 55,517
Intangible assets 503,389 742,071 616,560
Total non-current assets 655,163 812,256 672,077
-------------------------------- ------------- -------------- -------------
Current assets
Inventories 782,584 476,802 2,808
Trade and other receivables 3,113,770 221,981 194,897
Corporation tax receivable - 178,302 -
Cash and cash equivalents 2,214,496 1,351,746 465,671
-------------------------------- ------------- -------------- -------------
Total current assets 6,110,850 2,228,831 663,376
-------------------------------- ------------- -------------- -------------
Total assets 6,766,013 3,041,087 1,335,453
-------------------------------- ------------- -------------- -------------
Current liabilities
Trade and other payables 2,994,003 312,516 383,186
Deferred tax liability - - 87,379
Lease Liabilities - - 4,895
Provisions 226,250 - 226,250
Total current liabilities 3,220,253 312,516 701,710
-------------------------------- ------------- -------------- -------------
Non-Current liabilities
Lease Liabilites - - -
Loans and borrowings . 102,697 104,367
-------------------------------- ------------- -------------- -------------
Total non-current liabilities - 102,697 104,367
-------------------------------- ------------- -------------- -------------
Total liabilities 3,220,253 415,213 806,077
-------------------------------- ------------- -------------- -------------
Net assets 3,545,760 2,625,874 529,376
-------------------------------- ------------- -------------- -------------
Share capital 725,246 489,822 517,822
Share premium account 15,512,921 12,179,653 12,441,832
Capital redemption reserve 1,814,674 1,814,674 1,814,674
Retained earnings (15,744,391) (13,060,255) (15,475,669)
Reverse acquisition reserve (6,044,192) (6,044,192) (6,044,192)
Deferred shares 6,358,720 6,358,720 6,358,720
Share-based payment reserve 922,782 887,452 916,189
Total equity 3,545,760 2,625,874 529,376
-------------------------------- ------------- -------------- -------------
The accompanying notes are an integral part of these financial
statements.
Consolidated statement of changes in equity
For the 6 months ended 30 June 2021
Share Share Capital Retained Reverse Share-based Deferred Total
capital Premium redemption earnings acquisition payment Shares
reserve reserve
reserve
GBP GBP GBP GBP GBP GBP GBP GBP
--------------- ------------ ----------- ----------- ------------- ------------ ------------ ---------- ------------
Equity as
at 6,623,667 10,739,816 1,814,674 (11,713,042) (6,044,192) 812,899 - 2,233,822
01-Jan-20
Loss for
the year - - - (3,762,627) - - - (3,762,627)
--------------- ------------ ----------- ----------- ------------- ------------ ------------ ---------- ------------
Total - - - (3,762,627) - - - (3,762,627)
comprehensive
loss
Issue of
shares net
of expenses 252,875 1,702,016 - - - - - 1,954,891
Deferred
shares (6,358,720) - - - - - 6,358,720 -
Share-based
payments - - - - - 103,290 - 103,290
--------------- ------------ ----------- ----------- ------------- ------------ ------------ ---------- ------------
Equity as
at 517,822 12,441,832 1,814,674 (15,475,669) (6,044,192) 916,189 6,358,720 529,376
------------ ----------- ----------- ------------- ------------ ------------ ---------- ------------
31-Dec-20
--------------- ------------ ----------- ----------- ------------- ------------ ------------ ---------- ------------
Loss for - - - - - - - -
the period
--------------- ------------ ----------- ----------- ------------- ------------ ------------ ---------- ------------
Total
comprehensive
loss - - - (268,722) - - - (268,722)
Issue of
shares net
of expenses 207,424 3,071,089 - - - - - 3,278,513
Deferred - - - - - - - -
Shares
Share-based
payments - - - - - 6,593 - 6,593
--------------- ------------ ----------- ----------- ------------- ------------ ------------ ------------
Equity as
at 725,246 15,512,921 1,814,674 (15,744,391) (6,044,192) 922,782 6,358,720 3,545,760
------------ ----------- ----------- ------------- ------------ ------------ ---------- ------------
30-Jun-21
--------------- ------------ ----------- ----------- ------------- ------------ ------------ ---------- ------------
The accompanying notes are an integral part of these financial
statements
Consolidated statement of cash flows
Unaudited Unaudited Audited
6 months to 6 months to 12 months to
30 June 30 June
2021 2020 31 December 2020
GBP GBP GBP
---------------------------------------------------------- ------------- ------------- -----------------
Cash flows from operating activities
Loss before taxation (268,722) (1,348,882) (3,762,627)
Adjustments for:
Depreciation and amortization 60,677 100,989 157,169
Impairment losses on intangible assets - - 621,673
Finance expenses 1,782 1,981 4,558
Share-based payments 6,593 74,553 103,291
Loss on sale of asset - - 179,718
---------------------------------------------------------- ------------- ------------- -----------------
Operating loss before working capital changes (199,670) (1,171,359) (2,696,218)
Changes in working capital
(Increase)/decrease in inventory (779,776) (96,597) 380,205
(Increase) in trade and other receivables (2,918,873) (99,216) (72,132)
Increase in trade and other payables 2,610,817 42,663 111,663
Decrease in lease liability (4,895) - (281,888)
Increase in provisions - - 226,250
---------------------------------------------------------- ------------- ------------- -----------------
Cash used in operations (1,292,397) (1,324,509) (2,332,120)
Tax received - - 178,303
Interest paid on sale and leaseback - (718) -
Other interest paid (1,782) (1,262) (1,193)
Net cash outflow from operating activities (1,294,179) (1,326,489) (2,155,010)
---------------------------------------------------------- ------------- ------------- -----------------
Investing activities
Purchase of property, plant and equipment (127,944) (147) (34,226)
Purchase of intangible assets (3,198) (2,709) (2,777)
Sale of asset - 297,419 284,784
Acquisition of subsidiary in the year - - 109
Net cash flows used in investing activities (131,142) 294,563 247,890
---------------------------------------------------------- ------------- ------------- -----------------
Financing activities
Issue of ordinary shares (net of issue expenses) 3,278,513 (4,694,008) 1,655,528
Deferred Shares - 6,358,720 -
Convertible Loan (104,367) 102,697 101,000
Net cash flows from financing activities 3,174,146 1,767,409 1,756,528
---------------------------------------------------------- ------------- ------------- -----------------
Net change in cash and cash equivalents 1,748,825 735,483 (150,592)
Cash and cash equivalents at the beginning of the period 465,671 616,263 616,263
---------------------------------------------------------- ------------- ------------- -----------------
Cash and cash equivalents at the end of the period 2,214,496 1,351,746 465,671
---------------------------------------------------------- ------------- ------------- -----------------
Notes to the unaudited interim financial information for the 6
months ended 30 June 2021
1. General information
MyHealthChecked Plc (the "Company") is a public limited company
incorporated and domiciled in England and Wales. The registered
office of the Company is The Maltings, East Tyndall Street,
Cardiff, CF24 5EA. The registered company number is 06573154.
The principal activity of the Company and its subsidiary is in
the development and commercialisation of mobile health diagnostics
medical devices.
2. Significant accounting policies
Basis of preparation
The interim financial information for the six months ended 30
June 2021, which was approved by the Board of Directors on 28
September 2021, does not constitute statutory accounts as defined
by section 434 of the Companies Act 2006.
These interim consolidated financial statements have been
prepared in accordance with IAS 34 Interim Financial Reporting.
They do not include all disclosures that would otherwise be
required in a complete set of financial statements.
The financial information presented is unaudited and has been
prepared using the same accounting policies as those adopted in the
financial statements for the year ended 31 December 2020 and
expected to be adopted in the financial year ending 31 December
2021.
The interim financial information includes unaudited comparative
figures for the unaudited 6 months to 30 June 2020 of Concepta
Diagnostics Limited and comparatives for the year ended 31 December
2020 that have been extracted from the audited financial statements
for that year.
The financial statements for the year ended 31 December 2020
were reported on by the Company's auditors and delivered to the
Registrar of Companies. The report of the auditors was unqualified
and did not contain an adverse statement under section 498 (2) or
(3) of the Companies Act 2006.
In the opinion of the Directors, the interim financial
information for the period presents fairly the financial position
and the results from operations and cash flows for the period.
Going concern
The interim financial statements have been prepared under the
going concern basis as the Directors have undertaken a review of
the future financing requirements of the ongoing operation of the
Group and considers the Group is able to meet its working capital
requirements.
The Directors have prepared a cash flow forecast covering a
period extending beyond 12 months from the date of these financial
statements and including the impact of COVID-19.
The forecast contains certain assumptions about the performance
of the business including growth in future revenue, the cost model
and margins; and importantly the level of cash recovery from
trading. The directors are aware of the risks and uncertainties
facing the business but the assumptions used are the Directors'
best estimate of the future development of the business.
After considering the forecasts and the risks, the Directors
have a reasonable expectation that the Group has adequate resources
to continue in operational existence for the foreseeable future.
For these reasons, they continue to adopt the going concern basis
of accounting in preparing the annual financial statements. The
financial statements do not include any adjustments that would
result from the going concern basis of preparation being
inappropriate.
3. Segment information
The Group has one operating segment which is involved in the
provision of diagnostic healthcare products. The revenue for this
operating segment for the period to 30 June 2021 is as reported in
the Consolidated statement of comprehensive income.
4. Loss per share
Unaudited Unaudited Audited
6 months to 6 months to 12 months to
30 June 2021 30 June 2020 31 December 2020
Basic and diluted
Loss for the period used in basic & diluted EPS (GBP) (268,722) (1,348,882) (3,762,627)
Weighted average number of shares used in basic and diluted EPS 664,508,816 343,591,481 420,756,606
Loss per share (pence) (0.04) (0.39) (0.89)
----------------------------------------------------------------- -------------- -------------- ------------------
Basic loss per share is calculated by dividing the loss
attributable to equity holders of the Company by the weighted
average number of ordinary shares in issue during the period.
Due to the loss in the periods the effect of the share options
was considered anti-dilutive and hence no diluted loss per share
information has been provided.
5. Taxation
Unaudited Unaudited Audited
6 months to 6 months to 12 months to
30 June 2021 30 June 2020 31 December 2020
GBP GBP GBP
------------------------------ -------------- -------------- ------------------
The tax credit is as follows:
UK Corporation tax
Tax credit - current period - - -
Total current tax - - -
------------------------------ -------------- -------------- ------------------
The tax credit represents the research and development tax
credit for current interim and prior periods.
6. Related Party Transactions
Fees paid to directors and other companies for directors'
services and reimbursement of expenses for the period to 30 June 20
21 were GBP240,483 (June 20 20 GBP180,786 : 31 December 20 20 : GBP
275,014 ) and GBP 1,748 (June
20 20 : GBP 4,719 December 20 20 : GBP 9,071 ) were outstanding at period ended 30 June 20 21 .
These interim financial statements will be notified in
accordance with the AIM Rules for Companies, and will be available
shortly on the Company's website at
https://investors.myhealthchecked.com/.
7. Placing and funds raised
On 22 February 2021, the Company raised GBP3,505,109 (before
expenses) through a subscription of 207,424,361 new Ordinary
Shares. 194,285,714 were issued at GBP0.0175 per Ordinary Share and
13,138,647 were issued from previously received loan stock at
GBP0.008 per Ordinary Share.
The primary use of the net proceeds will be to invest in
developing and extending the MyHealthChecked Plc portfolio through
new product development. Additionally, there is a requirement to
strengthen and develop the marketing effort, appointing core
marketing personnel, and continuing to refine the
direct-to-consumer activities, through retail launch and targeting
strategic commercial contracts to exploit the MyHealthChecked Plc
portfolio.
8. Events after the reporting period
On 2 July 2021 the Company acquired 100% of the share capital of
Nell Health Ltd ("Nell Health"), a provider of genetic testing and
personalised nutrition consultancy services, for an initial
consideration of GBP1.202m, comprising GBP1.152m payable in shares
in the company's ultimate parent company, MyHealthChecked Plc and
GBP0.05m in cash, with a deferred consideration of up to GBP1.0m
payable in further shares in MyHealthChecked Plc, linked to
performance milestones. Nell Health trading activity will be
integrated within the MyHealthChecked Plc group and accounted as
hived up during the 2021 financial year.
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