TIDMOPTI
RNS Number : 3184X
OptiBiotix Health PLC
29 April 2019
29 April 2019
OptiBiotix Health plc
("OptiBiotix" or the "Company")
Final Results
OptiBiotix Health plc (AIM: OPTI), a life sciences business
developing compounds to tackle obesity, high cholesterol and
diabetes, announces its audited results for the year ended 30
November 2018.
The Company has made strong progress during this period as it
continues its transition from a development company into a
commercial business. This period has seen the Company sign a number
of commercial deals of increasing value across its product range as
it builds multiple revenue streams from manufacturing, application
and distribution partners across the world.
Highlights
-- A 543% increase in income from H1 to H2 and a 169% increase on 2017 income of GBP191k
-- Completion of five successful human taste studies on
SweetBiotix(R) demonstrating high sweetness and low off
flavours
-- A five year agreement with Akums Drugs and Pharmaceuticals
Ltd to exclusively manufacture and supply supplements and
biotherapeutic drug products containing LP(LDL) (R) in India
-- A non-exclusive license with one of the world's largest
providers of dairy products to explore the potential for using
OptiBiotix's SweetBiotix(R) technology to reduce the sugar content
in a range of its dairy food products
-- Exclusive agreement with a US company for the development of
LP(LDL) (R) as a drug product with a six figure milestone payments
at signing and at two subsequent conditional milestones, amounts
totalling a seven-figure sum
-- Award for SlimBiome(R) for Weight Management Ingredient of
the Year at Vitafoods 2018 and 'Best Functional Ingredient for
Health and Wellbeing' at Food Matters
-- Award for best scientific abstract at ProBiota 2018 co-authored with DSM for the identification and development
of a prebiotic which selectively enhances the growth of
Lactobacillus rhamnosus GG ("LGG(R) ") in the gut
-- Independent human studies by Oxford Brookes University
demonstrating that volunteers who took SlimBiome(R)
compared to a placebo feel fuller and are less hungry, have less
food cravings, and eat less sweet and fatty foods
-- The granting of medical device status and a CE mark for
SlimBiome(R) extending its application as a food ingredient into
high value medical products within consumer healthcare and
pharmaceutical markets
-- The investment in OptiBiotix of GBP450k by new non-executive
board members Neil Davidson and Sean Christie
Post period end highlights
-- Manufacturing, supply and profit sharing agreement for SlimBiome(R) in India
-- Appointment of Frédéric Narbel as Managing Director of
OptiBiotix's prebiotic division
-- LP(LDL) (R) determined GRAS by an Expert Panel in the United States
-- Licence from the Food Standards and Safety Authority India
for SlimBiome(R) to be manufactured in India
-- OptiBiotix's wholly owned subsidiary ProBiotix Health Ltd
raise of GBP1.025 million through the issue of convertible loan
notes to fund a potential initial public offering
Stephen O'Hara, CEO of OptiBiotix, commented: "OptiBiotix has
made significant progress in the last 12 months signing 18
commercial agreements making a total of 28 agreements since
launching products in May 2017. OptiBiotix's products are now being
commercialised as food ingredients, medical devices, drug
biotherapeutics and supplements in around thirty countries across
the world. Importantly, these agreements are starting to generate
income with revenue growth in the second half of the year
significantly higher than at the start of the year. As existing
deals contribute to full year revenues, partners continue to grow
sales with new product launches in 2019, and as new agreements
continue to be signed we anticipate further revenue growth in 2019.
On behalf of the Board I would like to thank our shareholders for
their continued support and we look forward to an exciting future
commercialising our products in a market forecast to become one of
the world's fastest growth areas."
This announcement contains information which, prior to its
disclosure, was considered inside information for the purposes of
Article 7 of Regulation (EU) No 596/2014 (MAR).
For enquires:
OptiBiotix Health plc www.optibiotix.com
Stephen O'Hara, Chief Executive Contact via Walbrook
below
Cairn Financial Advisers LLP (NOMAD)
Liam Murray / Jo Turner Tel: 020 7213 0880
finnCap (Broker)
Geoff Nash/ Kate Bannatyne (Corporate Finance)
Camille Gochez (Corporate Broking) Tel: 020 7220 0500
Walbrook PR Ltd Tel: 020 7933 8780 or optibiotix@walbrookpr.com
Anna Dunphy Mob: 07876 741 001
About OptiBiotix - www.optibiotix.com
OptiBiotix Health plc (AIM: OPTI), which was formed in March
2012, brings science to the development of compounds which modify
the human microbiome - the collective genome of the microbes in the
body - in order to prevent and manage human disease and promote
wellness.
OptiBiotix has an extensive R&D program working with leading
academics in the development of microbial strains, compounds, and
formulations which are used as active ingredients and supplements.
More than twenty international food and healthcare supplement
companies have signed agreements with OptiBiotix to incorporate
their human microbiome modulators into a wide range of food
products and drinks.
OptiBiotix is also developing its own range of consumer
supplements and health products. The Company's current areas of
focus include obesity, cardiovascular health, and diabetes.
Chairman's and Chief Executive Statement
We are pleased to present OptiBiotix Health plc's ("Optibiotix"
or the "Company") annual report and accounts for the year ended 30
November 2018.
The 12 months to 30 November 2018 have seen the continued
transition of the Company from a research and development business
to a company showing strong commercial traction for its award
winning products and technologies with significant deal flow and
rapidly growing revenues. This period has seen eighteen commercial
agreements signed in the year to 30 November 2018, eight more than
the 10 deals concluded in 2017. OptiBiotix has now completed twenty
eight deals reflecting international interest from industry in high
value ingredients and products which have a strong scientific and
clinical evidence base. Of these deals approximately 20% are with
companies whose annual turnover is greater than one billion
dollars, and represent an opportunity to access global markets with
large corporate partners.
As the year progressed, an increasing number of agreements
started to generate income with revenue growth in the second half
of the year significantly higher than at the start of the year. As
existing deals contribute to full year revenues, partners continue
to grow sales with new product launches in 2019, and new agreements
continue to be signed on a regular basis, we anticipate further
revenue growth in 2019.
Key to OptiBiotix's success is its strong science, independent
clinical studies, and key opinion leader endorsement.
Whilst each product has a different technological base they are
united by a common theme of:
- Understanding the underlying science and mechanism of action
in laboratory studies. This allows us to optimise our products and
identify multiple application opportunities
- Proving our products are safe and that they work in humans by
carrying out independent clinical studies and publishing them in
leading peer reviewed journals authored by leading academics
respected by industry
- Working with world leading key opinion leaders who support the science behind our products
This systematic approach has led to OptiBiotix's science winning
awards at international conferences (ProBiota 2017 and 2018) and
its two products, LP(LDL) (R) and SlimBiome(R) , being nominated
for awards, with SlimBiome(R) winning the award for best weight
management ingredient at Food Matters in November 2017, and
Vitafoods in May 2018. Of particular note in 2018 was the award for
best scientific abstract at ProBiota with co-authors DSM for
developing a prebiotic which selectively increased the growth rate
of DSM's Lactobacillus rhamnosus GG (LGG(R) ), contained within its
Culturelle(R) range. We believe this is the first reported
publication of an optimised prebiotic for LGG(R) , one of the
world's best-selling probiotics. We see the combination of a
probiotic and a prebiotic, which selectively enhances the
probiotics growth and functionality, creates a means to provide
product differentiation and enhance the benefits of existing
probiotic products in the market. We anticipate further commercial
progress in this area in 2019.
We were also pleased by results of a clinical study carried out
by the University of Roehampton which demonstrated that human
volunteers taking SlimBiome(R) had statistically significant
reductions in weight, BMI, hip circumference, percentage body fat,
fat mass and systolic blood pressure (P<0.01) after four weeks
of SlimBiome(R) intake. Significant reductions in cravings for
savoury foods (P<0.001) and a trend for reduced sweet cravings
were recorded from the end of week one of the treatment onwards,
accompanied by a significant improvement in mood (P<0.01). This
study added further evidence to other clinical studies and consumer
feedback which shows SlimBiome(R) has a significant impact on food
cravings and hunger, leading to easier and more successful weight
loss, typically 2-3lbs per week.
We believe this strategy of investing in strong science and
clinical studies, which independently demonstrate the safety and
efficacy of our products, provides clear product differentiation
and stimulates high industry interest, leading to strong deal flow.
As the Company continues its transition from a technology company
to a product company, it will continue to carry out further studies
and present its science at international conferences and in leading
peer reviewed journals around the world.
Of particular note in the last year is the recognition of this
systematic approach from pharmaceutical companies who have signed
deals to develop LP(LDL) (R) as a drug product, and the award of
medical device status and CE mark for SlimBiome(R) . These
represent significant value enhancing steps as they extend the
commercial opportunities for LP(LDL) (R) and SlimBiome(R) into the
high value medical products and pharmaceutical drug markets.
As the scientific and consumer understanding of the role of the
microbiome in the prevention of disease and the maintenance of
health grows we see substantial opportunities in international
markets for our products. We look forward to converting this
interest into growing revenue streams from license deals and supply
agreements in the months and years ahead.
During the period to date we have achieved a number of key
objectives, which continue to build shareholder value. These
include:
-- A US manufacturing, supply and profit sharing agreement with
Cereal Ingredients, Inc for SlimBiome(R) .
-- Completion of five successful human taste studies on
SweetBiotix(R) demonstrating high sweetness and low off
flavours.
-- A five year distribution agreement with Trigen Pharma
International to exclusively distribute and commercialise
OptiBiotix's own label CholBiome(R) products in Pakistan.
-- A non-exclusive distribution agreement with Cambridge
Commodities Ltd to distribute SlimBiome(R) weight management
technology in the United Kingdom.
-- A five year agreement with Akums Drugs and Pharmaceuticals
Ltd to exclusively manufacture and supply supplements and
biotherapeutic drug products containing LP(LDL) (R) in India.
-- A non-exclusive agreement with Seed Health to produce,
promote, market, and commercialise products containing LP(LDL) (R)
in the USA.
-- A non-exclusive license with one of the world's largest
providers of dairy products to explore the potential for using
OptiBiotix's SweetBiotix(R) technology to reduce the sugar content
in a range of its dairy food products.
-- Exclusive agreement with a US company for the development of
LP(LDL) (R) as a drug product with a six figure milestone payments
at signing and at two subsequent conditional milestones, amounts
totalling a seven-figure sum.
-- Exclusive license agreement with AlfaSigma to commercialise
food supplements containing LP(LDL) (R) in Italy.
-- Non exclusive distribution agreement with CTC Holding to
distribute SlimBiome(R) in the Philippines, Vietnam, Indonesia and
Colombia.
-- Launch of OptiBiotix online selling own brand GoFigure(R) and
CholBiome(R) products direct to market providing a shop window for
its LP(LDL) (R) and SlimBiome(R) technologies.
-- Award for SlimBiome(R) for Weight Management Ingredient of
the Year at Vitafoods 2018 and 'Best Functional Ingredient for
Health and Wellbeing' at Food Matters.
-- Award for best scientific abstract at ProBiota 2018 co-authored with DSM for the identification and development
of a prebiotic which selectively enhances the growth of
Lactobacillus rhamnosus GG ("LGG(R) ") in the gut.
-- Independent human studies by Oxford Brookes University
demonstrating that volunteers who took SlimBiome(R)
compared to a placebo feel fuller and are less hungry, have less
food cravings, and eat less sweet and fatty foods.
-- The granting of medical device status and a CE mark for
SlimBiome(R) extending its application as a food ingredient into
high value medical products within consumer healthcare and
pharmaceutical markets.
-- The appointment of Neil Davidson as Non-Executive Chairman
bringing sector expertise, a network of industry contacts, and over
30 years of operational and Board experience as Chairman, Chief
Executive and director of FTSE 100, AIM and private companies.
-- The investment in OptiBiotix of GBP450k by new non-executive
board members Neil Davidson and Sean Christie.
Strategy
OptiBiotix's strategy is to develop microbiome product with a
scientific and clinical evidence base targeted at large markets
(>GBP100m) where there are high growth opportunities (CAGR
>10%), and a large unmet demand. Given the evolving nature of
the microbiome OptiBiotix's approach has been designed to reduce
investor risk by building multiple opportunities within the
microbiome space across a number of platforms which create food
ingredients, supplements and pharmaceutical products with partners.
This multi partner, multi-channel approach, enables OptiBiotix to
maximize the income potential of each product, whilst limiting the
risk related to any individual deal. This is reflected in
OptiBiotix's deal structure in which approximately 20% of deals are
with companies whose annual turnover greater than one billion
dollars, and the remaining 80% are with small to medium size
companies who are quicker to market. Common to each partner is an
existing industry reputation and an established distribution
network within the target market.
This allows OptiBiotix to operate on a very asset-light
infrastructure with manufacturing, regulatory approvals, and sales
and marketing infrastructure funded by OptiBiotix's partners such
that license and royalty fees are largely cost free.. Whilst this
strategy takes longer to develop than single license deals it is a
low risk, low cost approach to accessing multiple consumer
healthcare and pharmaceutical markets around the world, and if
successful, has the potential to cumulatively generate substantive
revenues and profitability in the forthcoming years.
The large number of agreements signed in 2018 across multiple
application areas represents early execution of this strategy.
These agreements are starting to generate recurrent revenue streams
and will form the backbone of future sales growth. We anticipate
further execution of this strategy in 2019 with growing revenues
against a continued low-cost base creating profitable divisions
across all areas of the Company.
In April 2017, OptiBiotix's majority owned skincare subsidiary,
SkinBiotherapeutics (formerly SkinBiotix), was admitted to AIM with
an associated GBP4.5 million institutional and private client
investment manager fundraise. SkinBiotherapeutics plc is making
solid progress in building relationships with potential commercial
partners, successfully completing human studies and building a
commercial leadership team. As its partnership discussions turn
into commercial agreements providing industry validation of its
technology we anticipate SkinBiotherapeutics plc will grow in
value, whereupon OptiBiotix shareholders will benefit from the
appreciation of this asset. This is an innovative business model
which over time looks to give OptiBiotix shareholders a position in
multiple separately listed companies, and with it the prospect of
multiple returns.
As part of this strategy OptiBiotix raised GBP1.025 million
through the issue of convertible loan notes for its wholly owned
subsidiary ProBiotix Health Limited. The funds will be used to
provide funding for an independent exit or potential initial public
offering of ProBiotix in the UK, Europe, or the US, depending on
market conditions. This is in line with OptiBiotix's strategy to
form separate divisions, which could in due course become separate
legal entities with the potential for a separate public
listing.
Commercial
The last twelve months has seen the continued transition of
OptiBiotix(R) from a research and development company to a
commercial business with the signing of eighteen agreements with
products now being commercialised in over thirty countries. This
includes a number of agreements with leading manufacturing partners
within India. This introduces local manufactures to the supply
chain to meet the needs of existing and new corporate partners and
extend the opportunities offered by our products into the fast
growing Indian and Southern Asian markets. We anticipate further
deals with manufacturing partners in other territories as we extend
the reach of OptiBotix's products around the world.
The company has now signed twenty eight agreements since the
European launch of its products at Vitafoods in May 2017, and USA
product launch at Supply Side West in September 2017. These include
ten agreements for the Probiotic division, six for SlimBiome(R) and
two for SweetBiotix(R) . Three of these agreements extend LP(LDL)
(R) into drug biotherapeutics with one agreement for SlimBiome(R)
as a Medical Device. In the LP(LDL) (R) drug biotherapeutics deals,
the partner provides all funding for drug registration and
approvals in return for exclusivity. With the US partner deal,
OptiBiotix receives milestone and/or royalty payments based on
product development and future product sales. This is a low cost,
low risk approach to enter the pharmaceutical space, which, if
successful, has the potential to create significant value uplift
for OptiBiotix in the years ahead. Similarly, for SlimBiome(R) ,
its registration as a medical device with CE mark extends the
application of SlimBiome(R) from food products into high value
medical products and opens up access to consumer healthcare and
pharmaceutical markets across Europe. This means that OptiBiotix's
products are now being commercialised as food ingredients, medical
devices, drug biotherapeutics and supplements through retail and
online platforms around the world.
This is all part of a commercial strategy based on closing out
deals across multiple levels of the value chain, starting with
manufacturing agreements (e.g. Sacco, Knighton), royalty bearing
license deals with formulation partners (e.g. Nutrilinea, Cereal
Ingredients) for the supply of white label and branded products and
distribution agreements directly with retailers. This allows
OptiBiotix to develop multiple formulations and/or applications,
which have the science, cost structure, and synergistic mode of
action to create a wide product range, suitable for different
territories in consumer health, pharmaceutical and retail companies
around the world.
Of particular note in 2018 was the signing of two deals with
global partners for SweetBiotix(R) , sweet natural healthy sugars
which are not digested in the human gut and hence calorie free.
These partners are looking to explore the potential to reduce the
sugar content in a range of applications, in particular dairy.
These agreements are part of a number of on-going discussions with
potential partners who have expertise in either the manufacturing
and/or application development of high value speciality ingredients
within food and beverage products. One of these partners is funding
the pilot scale up and supply of two batches of SweetBiotix(R) for
consumer testing and further application development. Investors are
cautioned that discussions with corporate partners takes place
within a corporate process and timescale and are often subject to
strict confidentiality clauses which prevents any disclosure of
progress or otherwise.
With growing concerns over traditional sugars and artificial
sweeteners there is the potential to replace existing 'unhealthy'
sugar products with non-digestible, low calorie, healthy,
SweetBiotix(R) . Publication of the results on our human studies
and accompanying media reports in national newspapers, such as The
Times, has stimulated high industry interest and we anticipate
further developments and announcements in this area in the
future.
The focus for 2019 is on further extending our reach into new
application areas and new territories and translating industry
interest into deal flow and further revenue growth. In addition to
the registration of SlimBiome(R) as a medical device, and the
development of LP(LDL) (R) as a pharmaceutical drug product, we
will extend the application of LP(LDL) (R) from its use as a
supplement into use as a food and dairy ingredient. This is in line
with our strategy of building revenues and market presence of our
patented and trademarked products (LP(LDL) (R) , SlimBiome(R) ) as
the 'Intel' inside a wide range of food, beverage, supplement and
medical products around the world.
The online platform launched in autumn 2018 creates another
channel to market and a shop window for our technologies and
products. The addition of CholBiome(R) and CholBiome(R) 3X and
muesli pots to the store has led to month on month increase in
sales. We anticipate adding new products, including SlimBiome(R)
Medical, to the online store and growing contribution from online
sales in 2019.
Results
OptiBiotix's results for the 12 months ended 30 November 2018
are set out in the Consolidated Statement of Comprehensive
Income.
The results show revenue for the year of GBP514K. The majority
of this income (GBP434k) was generated in the second half of the
year (June to 30 November 2018) as an increasing number of
agreements started to generate revenues. These figures, albeit from
a low base, represent a 543% increase in income from H1 to H2 and a
169% increase on 2017 income of GBP191K. As existing deals
contribute to full year revenues, partners continue to grow sales
with new product launches in 2019, and new agreements continue to
be signed, we would hope to see continued revenue growth in
2019.
Administrative expenses for 2018 were GBP1,850,403, down
GBP223,865 (17.5%) from administrative expenses of GBP2,074,268 in
2017. This reflected a GBP141,719 reduction in research and
development costs (2018: GBP160,673; 2017: GBP302,392) as the
Company transitions from a research and development business to a
commercial business. Reductions were also seen in patent and IP
costs (2018: GBP88,003; 2017: GBP129,043) as patents were granted
reducing filing costs and legal and professional fees (2018:
GBP26,563; 2017: GBP130,729), which were higher in 2017 due to the
public listing of SkinBiotherapeutics plc. Within 2018
administration expenses of GBP267,943 was for non-cash expenses
representing depreciation, amortisation and share based payment
devaluations.
The operating loss for the period was GBP1,498,896, which was
GBP627,906 less than for the same period last year (2017:
GBP2,126,802).
At 30 November 2018, the Company had GBP1.33m cash in the bank.
Once R&D tax credits, and recoverable VAT are added back, the
balance was c. GBP1.67m. On 14 December 2018, post accounting
period, Probiotix Health Ltd, a wholly owned subsidiary of
OptiBiotix Health, announced it had raised GBP1.025 million of
capital through the issue of convertible loan notes in preparation
for a potential initial public offering. Of this, GBP198K was
received before 30 November with the remaining received post
accounting period. With this funding and growing revenues, the cash
position remains strong and sufficient to cover the delivery of
existing commercial plans.
The share of loss from OptiBiotix's associate,
SkinBiotherapeutics (SBTX), has increased substantially from
GBP294,278 in 2017 to GBP448,223 in 2018, representing an increase
in SkinBiotherapeutics scientific and clinical activity. This is an
accounting adjustment and has no impact on the Groups cash
balance.
Board and Management
We continue to evolve the Board in line with the Company's
development. The last twelve months has seen a number of board
additions to reflect the increased commercial focus.
We were pleased to announce the appointment of Neil Davidson CBE
as Non-Executive Chairman in January 2018 and Sean Christie, as a
Non-Executive Director, who joined us in September 2018. Neil
brings to the Board over thirty years of operational and Board
experience as Chairman and Chief Executive of FTSE 100, AIM and
private companies. Sean brings financial, investor and M&A
expertise and a strong track record of delivering revenue growth
and creating shareholder value. Both come with a wide network of
contacts in the food industry and a wealth of experience on the
Board of some of the UK's largest public companies. Their addition
to the board increases the Company's sector specific expertise and
brings experience of working within a large publicly listed
company.
We believe with the addition of Neil and Sean, we have a
well-balanced Board with scientific and commercial expertise in the
founder and Chief Executive Stephen O'Hara and market expertise in
Non-Executive Director Peter Wennström, one of the world's leading
experts in functional food innovation and marketing. Dr Sofia
Kolyda as Director of Research and Development brings specialised
expertise in prebiotics. They are complemented by Christina Wood
who brings sales and marketing expertise and our CFO Mark
Collingbourne.
Gareth Barker will step down from the board at the end of April
2019 due to work commitments in his new role. Gareth was Vice
President of Human Nutrition & Health (EMEA) at DSM and took on
a new role of President of Personal Care and Aroma Ingredients at
DSM in early 2018. On behalf of the Board, I would like to thank
Gareth for his contribution in helping guide OptiBiotix through its
early developmental years and wish him well in his new role at
DSM.
We anticipate further additions and changes to the management
team and the Board as we extend the global reach of our products
and in-line with the continued growth and expansion of the
Company.
At the end of the accounting period we announced that Dr Fred
Narbel would join the Board as Managing Director of the prebiotic
division containing its SweetBiotix(R) , OptiBiotic(R) and
microbiome modulating technology platforms. This appointment
reflects the growing partner interest in OptiBiotix's microbiome
modulators and SweetBiotix(R) . Fred's experience of speciality
food ingredients will help drive the commercialisation of
OptiBiotix's pipeline of products and, in time, add another revenue
stream to the growing revenues from OptiBiotix's LP(LDL) (R) and
SlimBiome(R) products.
Outlook
The last twelve months have seen the continued transition of
OptiBiotix from a research and development business to a company
showing strong commercial traction for its award winning products
and technologies, with significant deal flow and rapidly growing
revenues.
We anticipate further revenue growth in 2019 as existing deals
contribute to full year revenues and partners continue to grow
sales. More of our existing agreements will start to generate
revenues in 2019, particularly with larger partners launching
products in international markets in late 2019 and new agreements
continue to be signed in 2019.
We anticipate further revenue growth will occur from our online
platform (OPTIBIOTIX.Online), which has been making good progress
under the leadership of Steve Riley. Sales have increased month on
month as we have extended our range with the launch of new products
(e.g. Muesli, CholBiome(R) ), and invested in a mixture of digital
and newspaper advertising. To support online sales growth we
anticipate adding new products, including SlimBiome(R) Medical, to
the online store and extending the GoFigure(R) product range. We
anticipate revenues in 2019 from SlimBiome(R) Medical (which
received its CE mark and medical device registration at the end of
the accounting period), and our SweetBiotix(R) , OptiBiotic(R) and
microbiome modulating platforms. Revenue growth from these areas
will benefit from the appointment of Frederic Narbel as Managing
Director of OptiBiotix's prebiotic division. Frederic was Vice
President of Sales for Nutrition Solutions at Agropur, a company
with annualised sales of $6.4 billion (2017), and joined us on 1
March
2019.
We are seeing growing interest from international partners in
OptiBiotix's own label CholBiome(R) and GoFigure(R) brands and
intend to invest in marketing to build the brand. If this is
successful we believe there are opportunities to leverage the brand
to launch OptiBiotix own label products with partners across the
world and build substantive value in these assets. This is being
supported by a large investment in patents and trademarks to
broaden protection in international markets. OptiBiotix now has an
extensive and valuable intellectual property portfolio of over
ninety patents and forty trademarks.
The Company will continue to invest in its science and clinical
studies and present these in peer reviewed scientific journals and
at international conferences, with the endorsement of world key
opinion leaders. These presentations and publications raise
OptiBiotix's profile and reputation, attract commercial and media
interest in our products and provide the scientific evidence for
sales and marketing literature in support of product
commercialisation. We are particularly pleased that our science
continues to win awards at scientific conferences as this increases
industry interest. We were particularly pleased to win the best
scientific abstract at ProBiota 2018 with DSM for the first
reported publication of an optimised prebiotic for LGG(R) ,
contained within DSM's Culturelle(R) range. We see the development
of species or genera specific prebiotics which can selectively
enhance the growth and health benefits of existing probiotic
products as a growing area of interest to the probiotic industry, a
market expected to be worth more than $46.5 billion by 2020
(Markets and Markets).
As we extend our reach into new application areas and new
territories, the scale of the opportunity enlarges. The US is one
of the largest and fastest growing probiotic markets in the world
and an area of significant potential growth in 2019. With
supplements alone accounting for US$2.06 billion sales and
projected to grow by 55% to US$3.3bn by 2021, and food and beverage
products accounting for $5 billion per annum, ('Trends, Innovations
and Opportunities Driving The Global Probiotics Market, Euromonitor
International June 2017"), the US is a large and rapidly growing
market opportunity for probiotics such as LP(LDL) (R) . We were
pleased to announce post year end, in February 2019, that the
Independent Expert Panel ruled in favour of LP(LDL) (R) GRAS
status. This is a significant achievement and a major commercial
milestone for the US market as it expands the potential
applications of LP(LDL) (R) from use as a supplement to inclusion
as a functional ingredient in a wide range of food, dairy,
beverage, and high value medical food applications, across the USA.
The regulatory approval and extension of our products into other
application areas, particularly food and beverages, reflects a
growing confidence in our products and the scale of the
opportunity. We would hope to see the expansion of territories and
application areas leading to announcements of deals with a number
of national and international partners in the future.
With a population of 1.3 billion people and cardiovascular
disease accounting for up to 26% of all deaths (The Times of India
June 8, 2014), 15-20% of children are overweight and 60-70% of
adolescents remaining overweight or obese in their adulthood years
India represents a substantial opportunity for OptiBiotix's
products. In a recent visit to India the Company met with around
thirty companies who identified a growing trend within India to
improve Health and Wellbeing and an interest in products to help
manage lifestyle diseases like heart disease and obesity. We
believe India offers a substantial business opportunity which if
realised could deliver multimillion pound revenues annually.
OptiBiotix's technology platforms are being developed into
self-sustaining business units with a commercial focus lead by
directors who have the business development, sales skills and
experience to fully exploit the revenue potential of the products.
As these develop, our aim is to separate them into wholly owned
separate legal entities with the potential for an independent exit
by a trade sale or listing separately or collectively in UK, Europe
or the US, depending on market conditions. This allows OptiBiotix
shareholders to benefit from the appreciation of this asset plus
any dividends which may be returned in recognition of this value
uplift. This is consistent with our strategy of providing investors
a broad based investment portfolio across a number of areas in the
microbiome space which diversifies risk, whilst offering
shareholders multiple opportunities in this exciting space.
The transition from a technology to product company requires a
different focus and skill set. The appointment of Neil Davidson and
Sean Christie is the start of the process of bringing board level
sector and FTSE100 expertise into the company. We are pleased that
both Neil and Sean have invested in the region of GBP450,000 in
OptiBiotix since their appointment early in 2018. This level of
financial commitment from such established industry leaders as new
board members provides reassurance to theBoard on its strategy.
The Company is developing technology and products in the
microbiome space, a market growing at 22.3% per year, and described
by health experts as "healthcare's most promising and lucrative
frontier" (Markets and Markets). The Board believes OptiBiotix(R)
is at the leading edge in this space and has the right strategy,
team and award winning technology and products in place, to build a
substantive business over the next few years. We are particularly
pleased by the results customers are achieving with our products
with substantive reductions in cholesterol using CholBiome(R) X3
and typical weight loss of 2-3lbs per week with SlimBiome(R) and
GoFigure(R) products.
The last twelve months has seen continued progress in building a
broad-based microbiome business with a diversity of IP and
commercial agreements which provides shareholders with multiple
opportunities. The large number of agreements signed in 2018 across
multiple application areas and territories represent early tangible
evidence of this progress. The next stage of the process is to
build on existing revenues streams to continue building sales in
2019 against a continued low-cost base creating profitable
divisions across all areas of the Company.
We are pleased that our strategy of developing microbiome
products with a strong scientific and clinical evidence base with
key opinion leader support has provided clear product
differentiation and stimulated high commercial interest. We look
forward to converting this interest into agreements in new
territories and application areas in the months ahead to continue
rapidly growing revenues in this new and exciting area of science
which has the potential to revolutionise the future of
healthcare.
On behalf of everyone at OptiBiotix Health we would like to
thank our investors for their continued support and look forward to
an exciting future.
N Davidson and S OHara
26 April 2019
Consolidated Statement of Comprehensive Income
Year ended Year ended
30 November 30 November
2018 2017
GBP GBP
Revenue 514,289 191,073
Cost of sales (162,782) (73,706)
-------------- --------------
Gross Profit 351,507 117,367
Share based payments 128,222 56,932
Depreciation and amortisation 141,908 119,966
Other administrative costs 1,580,273 2,067,271
Total administrative expenses (1,850,403) (2,244,169)
-------------- --------------
Operating (loss) (1,498,896) (2,126,802)
Finance cost - (6,154)
Finance income 169 142
-------------- --------------
169 (6,012)
Share of loss from associate (448,223) (294,278)
Profit on disposal of subsidiary - 4,116,286
-------------- --------------
Profit/(loss) before Income
tax (1,946,950) 1,689,194
Income tax 54,371 228,447
-------------- --------------
Profit/(loss) for the period (1,892,579) 1,917,641
Other comprehensive income - -
-------------- --------------
Total comprehensive income
for the period (1,892,579) 1,917,641
Total comprehensive income
attributable to:
Owners of the company (1,919,276) 1,907,441
Non-controlling interests 26,697 10,200
-------------- --------------
(1,892,579) 1,917,641
Earnings per share from continued
operations
Basic profit/(loss) per share
- pence (2.33)p 2.43p
Diluted profit/(loss) per
share - pence (2.33)p 2.17p
Consolidated Statement of Financial Position
As at As at
30 November 2018 30 November 2017
ASSETS GBP GBP
Non-current assets
Intangibles 2,253,089 1,927,226
Property, plant & equipment 3,143 6,561
Investments 3,740,799 4,189,022
-------------- --------------
5,997,031 6,122,809
-------------- --------------
CURRENT ASSETS
Inventories 30,433 8,890
Trade and other receivables 373,803 106,122
Current tax asset 303,952 183,951
Cash and cash equivalents 1,324,307 1,247,431
-------------- --------------
2,032,495 1,546,394
-------------- --------------
TOTAL ASSETS 8,029,526 7,669,203
EQUITY
Shareholders' Equity
Called up share capital 1,694,488 1,586,628
Share premium 1,603,904 6,279,718
Share based payment reserve 602,739 474,517
Merger relief reserve 1,500,000 1,500,000
Retained Earnings 1,624,348 (2,805,347)
Non-controlling interest 36,897 10,200
-------------- --------------
Total Equity 7,062,376 7,045,716
-------------- --------------
LIABILITIES
Current liabilities
Trade and other payables 520,989 239,395
-------------- --------------
520,989 239,395
-------------- --------------
Non - current liabilities
Deferred tax liability 446,161 384,092
-------------- --------------
446,161 384,092
-------------- --------------
TOTAL LIABILITIES 967,150 623,487
-------------- --------------
TOTAL EQUITY AND LIABILITIES 8,029,526 7,669,203
Consolidated Statement of Changes in Equity
Share-based
Called Merger Payment
up Retained Share Relief reserve Total
Share Earnings Premium Non-Controlling Reserve equity
capital interest
GBP GBP GBP GBP GBP GBP GBP
Balance at 30
November 2016 7,196,010 (10,345,513) 6,144,357 90,692 1,500,000 417,585 5,003,131
Profit for the
year - 1,907,441 - 10,200 - - 1,917,641
Issues of shares
during the year 23,343 - 135,361 - - - 158,704
Share options
and warrants - - - - - 56,932 56,932
Non-controlling
Interest - - - (90,692) - - (90,692)
Cancellation
of shares
during
the year (5,632,725) 5,632,725 - - - - -
------------ -------------- -------------- -------------- ------------ ------------ --------------
Balance at 30
November 2017 1,586,628 (2,805,347) 6,279,718 10,200 1,500,000 474,517 7,045,716
Loss for the
year - (1,919,276) - 26,697 - - (1,892,579)
Issues of shares
during the year 107,860 - 1,673,157 - - - 1,781,017
Share options
and warrants - - - - - 128,222 128,222
Cancellation
of share
premium
account - 6,348,971 (6,348,971) - - - -
------------ -------------- -------------- -------------- ------------ ------------ --------------
Balance at 30
November 2018 1,694,488 1,624,348 1,603,904 36,897 1,500,000 602,739 7,062,376
Share capital is the amount subscribed for shares at nominal
value. Share premium represents amounts subscribed for share
capital in excess of nominal value, net of expenses.
Merger relief reserve arises from the 100% acquisition of
OptiBiotix Limited on 5 August 2014 whereby the excess of the fair
value of the issued ordinary share capital issued over the nominal
value of these shares is transferred to this reserve in accordance
with section 612 of the Companies Act 2006.
Retained earnings represents the cumulative profits and losses
of the group attributable to the owners of the company.
Share based payment reserve represents the cumulative amounts
charged in respect of unsettled warrants and options issued.
Consolidated Statement of Cash Flows
Year ended Year ended
30 November 2018 30 November 2017
GBP GBP
Cash flows from operating activities
Cash utilised by operations (1,233,717) (1,895,285)
Interest received 169 142
Taxation - 141,902
------------ ------------
Net cash outflow from operating
activities (1,233,548) (1,753,241)
Cash flows from investing activities
Purchases of property, plant
and equipment (2,954) (1,804)
Purchase of intangible assets (467,639) (43,381)
Disposal of subsidiary net of
cash balances - (228,212)
------------ ------------
Net cash outflow from investing
activities (470,593) (273,397)
------------ ------------
Cash flows from financing activities
Share issues 1,781,017 158,703
------------ ------------
Net cash inflow from financing
activities 1,781,017 158,703
------------ ------------
Increase/(decrease) in cash
and equivalents 76,876 (1,867,935)
Cash and cash equivalents at
beginning of year 1,247,431 3,115,366
------------ ------------
Cash and cash equivalents at
end of year 1,324,307 1,247,431
The Company's Report and Accounts for the year ended 30 November
2018 will be posted to shareholders shortly and may be downloaded
from the Company's website at www.optibiotix.com
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
FR IRMPTMBJTMRL
(END) Dow Jones Newswires
April 29, 2019 02:01 ET (06:01 GMT)
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