TIDMPHC
RNS Number : 4987M
Plant Health Care PLC
22 September 2021
RNS
22 September 2021
Plant Health Care plc
( " Plant Health Care", the " Group " and the " Company")
Interim Results 2021 and update on Current Trading
Plant Health Care(R) (AIM: PHC.L), a leading provider of novel
patent-protected biological products to global agriculture markets,
announces its unaudited interim results for the six months ended 30
June 2021.
Financial Highlights
- Revenue for the six months ended 30 June 2021 increased 13%
year-on-year to $3.5 million (H1 2020: $3.1 million).
- Cash operating expenses* increased 17% to $4.2 million (H1 2020: $3.6 million).
- Cash used in operations decreased 29% to $1.5 million (2020: $2.1 million).
- Adjusted LBITDA** increased to $2.3 million (2020: $1.8 million).
- In March of 2021, the Group raised $9.1 million (net of expenses).
- Cash and cash equivalents including investments of $11.1
million at 30 June 2021 (31 December 2020: $4.1 million).
Operational Highlights
- Harpin revenue increased by 26% to $2.4 million from $1.9 million.
o Sales in EMEAA of $1.3 million were up 76% on H1 2020.
o In-market sales in the US showed continued strong growth but
sales from PHC were flat at $0.6 million, as customer inventory
reduced further.
o Sales to Brazil for sugar cane ($0.3 million) were affected by
drought
- Covid-19 has impacted sales growth in Brazil and Mexico by limiting field promotion activities.
- Preparation for the launch of Saori(TM) (PHC279) in Brazil is
advancing well. The regulatory submission of PHC279 in the USA is
on track, with approval expected in Q3 2022.
- Preparing for next PREtec (PHC949) regulatory submission in
late 2021 with approval expected by mid-2023.
Dr Christopher Richards, Chief Executive Officer, commented:
"In-market Harpin 𝜶 <BETA> sales growth in the
first half of 2021 were most encouraging. Our distributors in the
USA have reported growing product adoption, in line with the prior
year, in both corn and specialty crops. Sales from PHC to the US
distributors are mostly made in the final quarter of the year.
Sales in Europe grew strongly, particularly in citrus in Spain
and in potatoes and the turf market in the UK. In Brazil, in-market
sales of H2Copla have been held back by drought and limitations on
the company's technical promotion effort caused by the latest wave
of Covid-19.
Sales in Mexico were held back by low export prices and
Covid-19. The world remains an uncertain place, as shown by the
effects of Covid-19 on sales in Brazil and Mexico.
The Board expects trading for the full year to be in line with
management expectations.
Following the successful equity raise in March 2021, the Board
has approved measured investments to accelerate the market entry of
PHC279 and PHC949, which are expected to pay back in 2023 &
2024. The Board intends to maintain a conservative approach to cash
management, targeting cash breakeven within existing cash
reserves."
*Cash operating expenses are defined as expenses excluding
depreciation, amortization, share-based payments and intercompany
currency adjustments.
**Adjusted LBITDA: loss before interest, tax, depreciation,
amortisation, shared-based payments and intercompany currency
adjustments.
In this document, references to "the Company" are to Plant
Health Care plc. References to "Plant Health Care", "the Group",
"we" or "our" are to Plant Health Care plc and its subsidiaries and
lines of business, or any of them as the context may require. The
Plant Health Care name and logo, Myconate, and Innatus and other
names and marks appearing herein and on company literature are
trademarks or trade names of Plant Health Care. All other
third-party trademark rights are acknowledged.
This announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014
Plant Health Care plc
Chris Richards - Chief Executive Officer
Jeffrey Hovey - Chief Financial Officer +1 919 926 1600
Arden Partners plc - Nomad and Broker
John Llewellyn-Lloyd / Antonio Bossi +44 (0) 20 7614 5900
About Plant Health Care
Plant Health Care offers products to improve the health, vigour
and yield of major field crops such as corn, soybeans, potatoes and
rice, as well as specialty crops such as fruits and vegetables. We
operate globally through subsidiaries, distributors and supply
agreements with major industry partners. Our innovative,
patent-protected biological products help growers to protect their
crops from stress and diseases, and to produce higher quality fruit
and vegetables, with a favourable environmental profile.
Find out more at Vox Markets and the company website:
www.planthealthcare.com
Chief Executive Officer ' s statement
Introduction
Plant Health Care is at the heart of the movement towards
sustainable food production. Our core products are derived from
naturally occurring proteins; these 'Vaccines for plants'(TM) ,
make crops healthier, grow better and withstand stress such as
drought and disease. They provide growers with higher yield and
better-quality crops, while having much lower impact on the
environment than conventional agricultural chemicals. The award of
LSE's Green Economy Mark in June 2021 confirms the Company's
sustainability credentials.
Our Commercial business was profitable and cash generative in
2020 and is now poised to accelerate. The core product is Harpin
𝜶 <BETA>, which offers remarkable benefits to
farmers in a wide range of crops. Over the last three years, we
have repositioned Harpin 𝜶 <BETA> and formed new
partnerships with major distributors in high value target crops. We
now have agreements in place with four of the world's largest
distributors, giving us unrivalled market access. Launches since
2019 are now delivering accelerated on-ground sales, which will
bring more consistent, balanced and profitable revenue growth for
Plant Health Care.
In New Technology, we are now planning to launch a major new
PREtec product every year for the next three years pending
regulatory approvals. PREtec (Plant Response Elicitor Technology)
is a novel, environmentally friendly approach to growing crops more
sustainably. PREtec is a platform technology, generating multiple
peptide products which, stimulate the plants' natural defence
systems and result in improved crop yield and quality. After eight
years and an investment of more than $24 million, the Company will
launch Saori, the first PREtec product, in Brazil during the second
half of 2021. Launches in the USA will follow in 2022 and 2023.
Together with subsequent launches, we are targeting markets which
have a value of greater than $5 billion. The Company has developed
a global scientific lead in the use of peptides for agriculture,
with the first patents now granted in the US and is accelerating
low-cost commercial scale production with toll manufacturers.
The Company raised $9.2 million (net of costs) in March 2021, in
a fund-raise which was heavily over-subscribed; cash reserves at
30th June, 2021 were $11.1 million. Our aim is to take the Group to
cash positive quickly within our existing cash reserves, while
investing to drive sales growth and launch multiple products from
the PREtec platform over the coming years.
Commercial Products
Our Commercial business markets our proprietary product Harpin
𝜶 <BETA> worldwide through distributors and also
distributes complementary third-party products alongside our own
products in Mexico. Sales of Myconate will be phased out due to
increased production cost which cannot be recovered in price.
Harpin-based products are well established in certain niche
markets, with more rapid expansion into the larger row crop
markets. We recently announced a new distribution agreement with
Agrii, the leading distributor in the UK for exclusive access to
Harpin <ALPHA><BETA> in all crops within the UK. With
this expanded distribution, PHC now has access to markets covering
more than 41 million hectares, with strong, committed partners. In
addition, we recently announced the registration approval of Harpin
𝜶 <BETA> for use on corn and soybeans in
Argentina. We continue to expand our market access through
collaborations with very large distributors which will be the
foundation for steady market growth.
During the first half of 2021, overall product sales were $3.5
million (H1 2020: $3.1 million). Sales of Harpin 𝜶
<BETA> increased by 26% to $2.4 million. The gross margin
decreased to 56% (H1 2020: 59%) due to currency fluctuations in
Mexico. Our first half working capital improved $0.4 million versus
year ended 31 December 2020.
Global Harpin <ALPHA><BETA> YTD on ground sales are
25% higher in the first half of 2021, than in all of 2020. This is
great news for our business and demonstrates strong in-market
growth of Harpin <ALPHA><BETA>.
Sales in EMEAA increased by 76% to $1.3 million (H1 2020: $0.7
million). In the UK, sales into the potato market ($0.3 million)
doubled from 2020 levels. Sales in Spain increased 69% (54% in
constant currency) through increased sales into the citrus
markets.
Sales in the US saw strong on ground sales demand in the first
half of this year.
Consumption of Harpin <ALPHA><BETA> in corn was up
over 24% versus 2020 driven by strong product performance. Harpin
<ALPHA><BETA> is now used on nearly 1% of US corn
acres.
Harpin <ALPHA><BETA> on ground sales in the US
specialty market (fruits and vegetables) in the first half were
double that of 2020 full year sales, which is above the target we
set for the 2021 season. This is a great success by the team
working with our strong partner in Wilbur Ellis and reinforces our
commitment to partnering with large distributors who can create
demand for technology like Harpin <ALPHA><BETA>.
In Brazil, we continue to see great performance from Harpin
<ALPHA><BETA> applications on sugar cane. First half
in-market sales of H2Copla were affected by drought in Brazil plus
limitations on customer visits related to increased COVID
incidents. However, Harpin <ALPHA><BETA> performed
exceptionally well under these drought conditions and we expect
these results to help drive product adoption for the next season in
2021.
Sales in Mexico decreased 7% to $1.3 million (H1 2020 $1.4
million); driven by reduced domestic and export demand for fresh
fruit and vegetables due to Covid-19. Sales of Harpin 𝜶
<BETA> were $0.3 million (H1 2020: $0.2 million); third party
sales were $1.1 million (H1 2020: $1.2 million).
The expansion of Plant Health Care relationships with large
distributors has given us greater visibility of on-ground sales
plus broad access to specialty and row crop markets. This has
driven supply chain efficiencies and should continue to lead to
more consistent growth in our revenues.
New Technology (PREtec products)
PREtec is a platform technology, with the potential to generate
many products, offering a wide range of specific grower benefits.
Our aim is to deliver a major PREtec product launch every year for
the next three years pending regulatory approvals; then to invest
to further expand the product range. In total, we are targeting
market opportunities worth more than $5 billion annually.
The PREtec 'vaccines for plants' act by stimulating the plant's
own natural defence mechanisms. Inspired by natural proteins, these
peptides can be customised to target features such as growth
promotion, disease resistance or drought stress. Since 2012, our
research efforts have brought forward six lead products, from three
major platforms. The Innatus 3G platform targets growth and disease
resistance. The T-Rex 3G platform targets nematode defence, while
the Y-Max 3G platform delivers increased yield and growth.
Launching Saori in Brazil, first PREtec product
Saori is the brand name for PHC279, which will be launched in
Brazil in the second half of 2021. The Brazilian authorities
approved Saori in only 12 months, compared with up to six years for
a conventional agrochemical; they recognized both the effectiveness
and the sustainability profile of the product.
Brazil is the world's largest exporter of soybeans, with some 38
million hectares planted in 2020. One of the challenges of
producing soybeans in Brazil is disease; growers spent $2.85
billion in 2020 on soybean fungicides in Brazil.
In trials with 16 independent advisors in the 2020/21 crop
season, soybeans treated with Saori showed increased vigour and
better control of a wide range of diseases, compared with
conventional treatments. The average yield increase was about 4%;
significantly more, up to 5.8% at some treatment rates in areas of
drought stress or high disease pressure. Brazilian soy farmers
spend more than $2.85 billion on fungicides annually; the promise
of Saori is to protect the soy crop from Asian Soy Rust and other
diseases, resulting in higher soy yields for the grower. Limited
volumes of Saori will be available for commercial sales in
2021.
PREtec product launches in the USA
In November of 2020, the Company signed a Joint Development
Agreement with Wilbur Ellis, one of the largest distributors of
crop protection products in the USA. The two companies are
collaborating on the development and launch of products based on
four PREtec peptides, for use in specialty crops (fruits and
vegetables) in the USA.
PHC279 is progressing through the regulatory process in the EPA
(US Environmental Protection Agency), with approval expected in
mid-2022. Early season observations demonstrated good control of
late blight in potatoes; first commercial sales are expected in
late 2022.
PHC949, from the T-Rex 3G nematode control platform, is showing
exceptional results; nematode control is often comparable to
chemical standards, which is a remarkable for a highly sustainable,
biological product. The Company anticipates submitting to EPA for
regulatory approval before the end of 2021, with approval expected
in mid-2023.
We are also evaluating PHC404 and PHC414 with Wilbur Ellis;
these are biostimulant products. They are showing promise in
promoting yield and quality in a range of fruit, tree and vegetable
crops.
Further PREtec products in development
The Company is making plans to extend the development of PREtec
products in Europe and elsewhere over the coming years. Europe,
which is the world's largest market for sustainable agriculture
with annual sales of over $2 billion, is an attractive opportunity
for PREtec. The regulatory regime for biological products within
Europe, however, remains unclear and complex. The timing of
submissions and approvals in Europe is therefore still under study.
Substantial opportunities exist for PREtec products in countries of
South America outside Brazil and in other Regions. These will be
pursued as resources permit.
Manufacturing PREtec peptides
Commercial product for the launch of Saori in Brazil has been
produced at a pilot-scale facility at Pennsylvania State
University. Plans are well advanced with toll manufacturers to
establish full commercial production of PHC279; the Group expects
to make an announcement on manufacturing arrangements before the
end of 2021. Commercial production of PHC949 is being trialed with
the same toll manufacturers. Toll production of other PREtec
peptides will follow, as launches progress.
Intellectual property
Plant Health Care has filed more than 50 patent applications
worldwide for its PREtec peptide technology since 2012. Nine US
patents have been granted by the US Patent and Trademark Office
(USPTO) since 2020. Additional patents are expected to be granted
in the US and internationally in 2022. The Group is confident that
we are establishing strong intellectual property protection, in key
countries around the world.
Summary of financial results
Financial highlights for the six months ended 30 June 2021, with
comparatives for the six months ended 30 June 2020, are set out
below:
2021 2020
$'000 $'000
Revenue 3,499 3,100
Gross profit 1,956 1,814
Research and development (1,299) (1,114)
Sales and marketing (1,758) (1,268)
Administrative (1,198) (1,267)
Non-cash expenses (453) (371)
Intercompany foreign exchange gains/(loss) 423 (1,988)
-------------------------------------------- ---------- ----------
Total operating expenses (4,285) (6,008)
Operating loss (2,329) (4,194)
-------------------------------------------- ---------- ----------
Net finance (expense)/ income (27) 181
Net loss for period before tax (2,356) (4,013)
-------------------------------------------- ---------- ----------
Cash operating expenses increased $0.6 million to $4.2 million
(H1 2020: $3.6 million).
The reconciliation of operating loss to LBITDA is as
follows:
2021 2020
($'000) ($'000)
Operating loss (2,329) (4,196)
Depreciation/amortisation 254 351
Share-based payments 199 16
Intercompany foreign exchange
(gains)/loss (435) 2,025
Adjusted LBITDA (2,311) (1,804)
Revenue
Revenues for the six-month period ended 30 June 2021 were $3.5
million (H1 2020: $3.1 million) producing a gross profit of $2.0
million (H1 2020: $1.8 million) and the loss before tax was $2.4
million (H1 2020: $4.0 million). The gross profit margin was 56%
(H1 2020: 59%). The reduction in gross margin was due to currency
fluctuations in Mexico. Harpin revenue increased 26% (24% constant
currency) to $2.4 million (H1 2020: $1.9 million). Harpin revenues
were higher than prior year due to strong sales in the EMEAA potato
& citrus markets and in the potato and pepper markets in
Mexico.
Cash operating expenses
Operating expenses, excluding non-cash items, increased $0.6
million to $4.2 million (H1 2020: $3.6 million) due to increased
personnel costs in sales and marketing and PREtec product launch
costs. Adjusted LBITDA increased $0.5 million to $2.3 million (H1
2020: $1.8 million) primarily due to increased Sales and Marketing
and PREtec product launch costs.
Operating expenses
Operating expenses decreased by $1.7 million for the six-month
period to $4.3 million (2020: $6.0 million). This is primarily due
to $0.4 million of non-cash currency gains primarily related to a
Pound Sterling loan with a subsidiary company (H1 2020: $2.0
million currency loss).
Cash position and liquidity
As of 30 June 2021, the Group had cash and investments of $11.1
million. Cash and costs continue to be tightly controlled.
Net cash outflows from operating activities decreased 26% to
$1.5 million (H1 2020: $2.0 million ). The decrease is due to
improved working capital of $1.0 million. Included in the cash used
in operations is a decrease in the Group ' s inventory, accounts
receivable and accounts payable balances
Net cash flows from financing activities increased $8.8 million
(H1 2020: $4.7 million). The increase is due to the March 2021
equity raise of $9.1 million (net of costs).
Principal Risks and Uncertainties
The principal risks and uncertainties facing the Group remain
broadly consistent with the Principal Risks and Uncertainties
reported in Plant Health Care ' s 31 December 2020 Annual Report.
In addition, since then, the Board have been monitoring and
mitigating the effects of the following international events on the
Group ' s business:
Going concern (including consideration of COVID-19)
In carrying out the going concern assessment, the Directors have
considered a number of scenarios, taking account of the possible
continued impact of the COVID-19 pandemic, in relation to revenue
forecasts for the next 12 months. Given the current uncertainties,
it is not yet fully clear when the global economic activity will
fully return to pre pandemic levels, therefore, we continue to
prepare the business for varying levels of performance. To that
end, we have continued to model the effects of differing levels of
sales performance along with the measures we can take to ensure
that the Group remains within its available working capital.
In reaching their going concern assessment, the Directors have
considered the foreseeable future, a period extending at least 12
months from the date of approval of this interim financial report.
This assessment has included consideration of the forecast
performance of the business, as noted above, the payment of
contingent consideration, and the cash and financing facilities
available to the Group. Considering all this analysis, the
Directors are satisfied that, the Group has sufficient cash
resources over the period of at least 12 months from the date of
approval of the interim consolidated financial statements. As such,
the interim consolidated financial statements have been prepared on
a going concern basis.
Brexit
The United Kingdom ("UK") formally left the European Union
("EU") on 30 January 2020. The transition period ended on 31
December 2020, where upon the UK-EU Trade & Cooperation
Agreement (together with other connected Agreements concluded on by
the UK and EU, which includes the Exchanging and Protecting of
Classified Information Agreement) signed on the 24 December 2020
came into effect.
The UK currently represents some 3% of revenues for the Group
and is not a manufacturing centre. As the Group operates
subsidiaries in many countries, there are several channels
available to us to continue business with the same customers,
should the need arise, with little to no effect from Brexit
changes. However, the Group continues to monitor the situation so
it can manage the risk of any volatility in the global financial
markets, which could arise due to Brexit, and the effect on global
economic performance.
Current trading and outlook
The Board remains confident about the prospects for building a
growing, profitable Commercial business, as sales of Harpin
<ALPHA><BETA> continue to increase. We anticipate a
strong second half of 2021 and are confident of achieving material
revenue growth in 2021, despite macro-level market-driven
challenges.
Preparations for the first launches of PHC279 are progressing to
plan, with further PREtec peptides following. The medium-term
prospects for PREtec peptides, in markets worth more than $5
billion, are very exciting.
The Board has reviewed the Company ' s cash position and
concluded that we are able to achieve cash breakeven within
existing cash resources. The Board will take whatever steps are
necessary, including by reducing cash expenses, to achieve
that.
Dr. Christopher Richards
Chief Executive Officer
21 September 2021
Consolidated statement of comprehensive income
FOR THE SIX MONTHSED 30 JUNE 2021
Six months Six months
to 30 June to 30 June
2021 2020
(Unaudited) (Unaudited)
Note $'000 $'000
Revenue 3,499 3,100
Cost of sales (1,543) (1,286)
Gross profit 1,956 1,814
Research and development (1,500) (1,366)
Sales and marketing (1,758) (1,268)
Administrative expenses (1,027) (3,374)
------------------------------------- ----- ------------------- -----------------
Operating loss 4 (2,329) (4,194)
Finance income 25 193
Finance expense (52) (12)
------------------------------------- ----- ------------------- -----------------
Loss before tax (2,356) (4,013)
Income tax expense (9) (14)
Net loss for the period (2,365) (4,027)
------------------------------------- ----- ------------------- -----------------
Other comprehensive income:
Exchange difference on translation
of foreign operations (446) 1,444
------------------------------------- -----
Total comprehensive loss for
the period (2,811) (2,583)
===================================== ===== =================== =================
Basic and diluted loss per
share 6 $(0.01) $(0.02)
===================================== ===== =================== =================
Consolidated statement of financial position
AT 30 JUNE 2021
30 June 31 December
2021 2020
(Unaudited) (Audited)
Note $'000 $'000
Assets
Non-current assets
Intangible assets 1,623 1,625
Property, plant and equipment 613 246
Right-of-use 762 970
Trade and other receivables 156 303
Total non-current assets 3,154 3,144
--------------------------------- ----- ------------------------ ------------------
Current assets
Inventories 3,077 3,567
Trade and other receivables 2,406 2,778
Tax Receivable - 251
Investments 3 9,547 3,167
Cash and cash equivalents 1,556 982
--------------------------------- ----- ------------------------ ------------------
Total current assets 16,586 10,745
--------------------------------- ----- ------------------------ ------------------
Total assets 19,740 13,889
--------------------------------- ----- ------------------------ ------------------
Liabilities
Current liabilities
Trade and other payables 1,698 2,118
Short term lease liabilities 371 400
Short term borrowings 64 33
Total current liabilities 2,133 1,759
--------------------------------- ----- ------------------------ ------------------
Non-current liabilities
Long term lease liabilities 415 583
Long term borrowings 213 193
Total non-current liabilities 628 776
--------------------------------- ----- ------------------------ ------------------
Total liabilities 2,761 3,327
--------------------------------- ----- ------------------------ ------------------
Total net assets 16,979 10,562
================================= ===== ======================== ==================
Capital and reserves
attributable to owners
of the Company
Share capital 4,294 3,605
Share premium 100,859 92,520
Foreign exchange reserve (1,718) (1,271)
Retained deficit (86,456) (84,292)
--------------------------------- -----
Total equity 16,979 10,562
================================= ===== ======================== ==================
Consolidated statement of cash flows
FOR THE SIX MONTHSED 30 JUNE 2021
Six months ended Six months ended
30 June 30 June
2021 2020
(Unaudited) (Unaudited)
$'000 $'000
Cash flows from operating activities
Loss for the year (2,365) (4,029)
Adjustments for:
Depreciation of property, plant
and equipment 45 168
Depreciation of right-of-use assets 207 161
Amortisation of intangibles 2 22
Share-based payment expense 199 16
Finance income (4) (126)
Finance expense 52 11
Foreign exchange on intercompany (435) 1,460
Decrease in trade and other receivables 776 903
Gain on disposal of fixed assets (5) -
Decrease/(Increase) in inventories 490 (324)
Decrease in trade and other payables (421) (273)
Net cash used in operating activities (1,459) (2,011)
------------------------------------------ ----------------- -----------------
Investing activities
Purchase of property, plant and
equipment (364) (2)
Sale of property, plant and equipment 20 -
Finance income 21 67
Purchase of investments (8,077) (2,733)
Sale of investments 1,674 1,098
------------------------------------------ ----------------- -----------------
Net cash (used)/provided by investing
activities (6,726) (1,570)
------------------------------------------ ----------------- -----------------
Financing activities
Finance expense (23) (2)
Lease payments (226) (190)
Issue of ordinary share capital 9,029 4,449
Proceeds from unsecured loan - 448
------------------------------------------ ----------------- -----------------
Net cash provided/(used) by financing
activities 8,780 4,705
------------------------------------------ ----------------- -----------------
Net increase/(decrease) in cash
and cash equivalents 595 1,124
Effects of exchange rate changes
on cash
and cash equivalents (21) -
Cash and cash equivalents at beginning
of period 982 457
------------------------------------------ ----------------- -----------------
Cash and cash equivalents at end
of period 1,556 1,581
========================================== ================= =================
Notes to the unaudited financial information
1 General information
Plant Health Care plc is a company incorporated and domiciled in
England. The unaudited interim financial information of the Group
for the six months ended 30 June 2021 comprise the Company and its
subsidiaries (together referred to as the "Group").
The Board of Directors approved this interim report on 22
September 2021.
2 Basis of preparation and accounting policies
These interim consolidated financial statements have been
prepared using accounting policies based on international
accounting standards in conformity with the requirements of the
Companies Act 2006. They do not include all disclosures that would
otherwise be required in a complete set of financial statements and
should be read in conjunction with the 31 December 2020 Annual
Report. The financial information for the half years ended 30 June
2021 and 30 June 2020 does not constitute statutory accounts within
the meaning of Section 434 (3) of the Companies Act 2006 and both
periods are unaudited.
The annual financial statements of Plant Health Care Plc ('the
Group') are prepared in accordance with international accounting
standards in conformity with the requirements of the Companies Act
2006. The statutory Annual Report and Financial Statements for the
year ended 31 December 2020 have been filed with the Registrar of
Companies. The Independent Auditors' Report on the Annual Report
and Financial Statements for this year end was unqualified, did not
draw attention to a matter by way of emphasis, and did not contain
a statement under 498(2) or 498(3) of the Companies Act 2006.
The Group has applied the same accounting policies and methods
of computation in its interim consolidated financial statements as
in its 31 December 2020 annual financial statements, except for
those that relate to new standards and interpretations effective
for the first time for periods beginning on (or after) 1 January
2021 and will be adopted in the 2021 financial statements. There
are deemed to be no new and amended standards and/or
interpretations that will apply for the first time in the next
annual financial statements that are expected to have a material
impact on the Group.
Going Concern
The interim consolidated financial statements have been prepared
on a going concern basis. The ability of the Group to continue as a
going concern is contingent on the ongoing viability of the Group.
The Group meets its day-to-day working capital requirements through
its cash and investment balances. The continued impact of the
global Covid pandemic means governments are continuing to enforce
varying restrictions on people movements and international travel,
together with other precautionary social distancing measures. This
has resulted a need to consider whether budgets and targets
previously set are realistic in light of these events
The Directors have prepared cash-flow forecasts covering a
period of at least 12 months from the date of approval of these
interim financial statements, with the forecasts and projections,
taking account of reasonable possible changes in trading
performance. They show that the Group expects to be able to operate
within the level of its current cash and investment reserves.
Furthermore, in carrying out the going concern assessment, the
directors have considered a number of scenarios, taking account of
the possible the continued impact of the pandemic, including
changes in sales volumes and the timing of settlement of existing
debts together with cost savings associated with these changes and
the directors have the ability to identify further cost savings, if
necessary, to help mitigate any impact on cash outflows.
Having assessed the principal risks and the other matters
discussed in connection with the going concern statement, 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 and deem there to be no emphasis over going
concern, in preparing the financial information.
3 Investments
Investments comprise short-term investments in notes and bonds
having investment grade ratings. These assets are actively managed
and evaluated by key management personnel on a fair value basis in
accordance with a documented investment strategy. They are carried
at fair value as determined by quoted prices on active markets,
with changes in fair values recognised through profit and loss.
4 Operating loss
Six months to Six months to
30 June 30 June
2021 2020
(unaudited) (unaudited)
$'000 $'000
Operating loss is stated after
charging:
Depreciation 252 329
Amortisation 2 22
Share-based payment expense 199 16
Foreign exchange (gain)/loss (435) 2,025
5 Segment information
The Group views, manages and operates its business according to
geographical segments. Revenue is generated from the sale of
agricultural products across all geographies.
Six months to 30 June 2021 (unaudited)
Rest Total New
Americas Mexico of World Elimination Commercial Technology Total
$'000 $'000 $'000 $'000 $'000 $'000 $'000
Revenue*
Proprietary
product
sales 838 285 1,303 - 2,426 - 2,426
Third-party
product
sales 18 1,055 - - 1,073 - 1,073
Inter-segmental
product sales 641 - - (641) - - -
Total revenue 1,497 1,340 1,303 (641) 3,499 - 3,499
--------- ------- ----------- ------------ ----------- ----------- --------
Cost of sales (1,033) (755) (396) 641 (1,543) - (1,543)
Research and
development - - - - - (1,206) (1,206)
Sales and
marketing (887) (392) (384) - (1,663) (138) (1,801)
Administration (348) (102) (42) - (492) (49) (541)
Non-cash
expenses:
Depreciation (52) (40) (11) - (103) (163) (266)
Amortisation - - (2) - (2) - (2)
Share-based
payment (26) - (11) - (37) (90) (127)
--------- ------- ----------- ------------ ----------- ----------- --------
Segment
operating
(loss)/profit (849) 51 457 - (341) (1,646) (1,987)
Corporate
expenses
**
Wages and
professional
fees (737)
Administration
*** 395
Operating loss (2,329)
Finance income 25
Finance expense (52)
--------- ------- ----------- ------------ ----------- ----------- --------
Loss before tax (2,356)
--------- ------- ----------- ------------ ----------- ----------- --------
* Revenue from one customer within the Mexico segment totalled
$550,000 or 16% of Group revenues.
** These amounts represent public company expenses for which
there is no reasonable basis by which to
allocate the amounts across the Group's segments.
*** Includes net share-based payments expense of $72,000
attributed to corporate employees who are not affiliated with any
of the Commercial or New technology segments. Includes $0.4 million
foreign exchange gains in non-US dollar denominated inter-company
funding.
Six months to 30 June 2020 (unaudited)
Rest Total New
Americas Mexico of World Elimination Commercial Technology Total
$'000 $'000 $'000 $'000 $'000 $'000 $'000
Revenue*
Proprietary
product
sales 975 230 737 - 1,942 - 1,942
Third-party
product
sales - 1,154 4 - 1,158 - 1,158
Inter-segmental
product sales 353 - 46 (399) - - -
Total revenue 1,328 1,384 787 (399) 3,100 - 3,100
--------- ------- ----------- ------------ ----------- ----------- --------
Cost of sales (655) (721) (309) 399 (1,286) - (1,286)
Research and
development - - - - - (1,089) (1,089)
Sales and
marketing (689) (290) (289) - (1,268) - (1,268)
Administration (395) (186) (87) - (668) (96) (764)
Non-cash
expenses:
Depreciation (47) (35) (7) - (89) (240) (329)
Amortisation (19) - (3) - (22) - (22)
Share-based
payment - - - - - (11) (11)
--------- ------- ----------- ------------ ----------- ----------- --------
Segment
operating
(loss)/profit (477) 152 92 - (233) (1,436) (1,669)
Corporate
expenses
**
Wages and
professional
fees (518)
Administration
*** (2,007)
Operating loss (4,194)
Finance income 193
Finance expense (12)
--------- ------- ----------- ------------ ----------- ----------- --------
Loss before tax (4,013)
--------- ------- ----------- ------------ ----------- ----------- --------
* Revenue from one customer within the Mexico segment totalled
$508,000 or 16% of Group revenues.
Revenue from one customer within the America's segment totalled
$365,000 or 12% of Group revenues.
** These amounts represent public company expenses for which
there is no reasonable basis by which to
allocate the amounts across the Group's segments.
*** Includes net share-based payments expense of $5,000
attributed to corporate employees who are not affiliated with any
of the Commercial or New technology segments. Includes $2.0 million
foreign exchange losses in non-US dollar denominated inter-company
funding.
6 Loss per share
Basic loss per ordinary share has been calculated on the basis
of the loss for the period of $2,365,000 (loss for the six months
ended 30 June 2020: $4,027,000) and the weighted average number of
shares in issue during the period of 280,828,375 (six months ended
30 June 2020: 238,510,886).
The weighted average number of shares used in the above
calculation is the same as for total basic loss per ordinary share.
Instruments that could potentially dilute basic earnings per share
in the future have been considered but were not included in the
calculation of diluted earnings per share because they are
anti-dilutive for the periods presented. This is due to the Group
incurring losses on continuing operations for the period.
7 Cautionary statement
This document contains certain forward-looking statements
relating to Plant health Care plc ('the Group'). The Group
considers any statements that are not historical facts as
"forward-looking statements". They relate to events and trends that
are subject to risk and uncertainty that may cause actual results
and the financial performance of the Group to differ materially
from those contained in any forward-looking statement. These
statements are made by the directors in good faith based on
information available to them and such statements should be treated
with caution due to the inherent uncertainties, including both
economic and business risk factors, underlying any such
forward-looking information .
Copies of this report and all other announcements made by Plant
Health Care plc are available on the Company's website at
www.planthealthcare.com/for-investors.
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END
IR FLFSVASILFIL
(END) Dow Jones Newswires
September 22, 2021 01:59 ET (05:59 GMT)
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