16th Apr 2019 12:41
Vectura Group plc
Report and Accounts for the year ended 31 December 2018 and Annual General Meeting 2019
Chippenham, UK - 16 April 2019: Vectura Group plc (LSE: VEC) ("Vectura", the "Group" or the "Company") announces that today it has released the following documents:
· Report and Accounts for the year ended 31 December 2018
· Notice of Annual General Meeting ("AGM") 2019
· Form of Proxy for the AGM
In accordance with the Listing Rule 9.6.1, a copy of these documents have been uploaded to National Storage Mechanism and will shortly be available for inspection at www.morningstar.co.uk/uk/nsm.
The AGM is scheduled to be held at 10.30 on Wednesday 29 May 2019 at the offices of Clifford Chance LLP, 10 Upper Bank Street, London E14 5JJ.
In compliance with DTR 6.3.5, the following information is extracted from the Report and Accounts for the year ended 31 December 2018 and should be read in conjunction with the Company's Final Results announcement issued on 26 March 2019. The documents are also available at www.vectura.com and together constitute the material required by DTR 6.3.5 to be communicated to the media in unedited full text through a Regulatory Information Service. Page and note references in the text refer to page numbers and notes contained in the Report and Accounts for the year ended 31 December 2018. This announcement is not a substitute for reading the Report and Accounts for the year ended 31 December 2018 in full.
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Enquiries
Vectura Group plc +44 (0)1249 667700
Paul Fry - Chief Financial Officer
David Ginivan - VP Corporate Communications
Elizabeth Knowles - VP Investor Relations
John Murphy - Company Secretary
Consilium Strategic Communications +44 (0)20 3709 5700
Mary-Jane Elliott / Sue Stuart / Jessica Hodgson
About Vectura
Vectura is an industry-leading inhaled product formulation, device design and development business offering a uniquely integrated inhaled drug delivery platform. We develop inhalation products to help patients suffering from airways diseases.
Vectura has eight key inhaled, two non-inhaled and ten oral products marketed by partners with growing global royalty streams, and a diverse partnered portfolio of drugs in clinical development. Our partners include Hikma, Novartis, Sandoz, Mundipharma, Kyorin, Baxter, GSK, UCB, Bayer, Chiesi, Almirall, Janssen, Dynavax and Tianjin KingYork.
Vectura's strategy is to fully leverage its differentiated technology and skills, maximising value by enhancing the delivery and performance of inhaled products and through the development of high-quality generic alternatives to branded therapies.
For further information, please visit Vectura's website at www.vectura.com.
RISK MANAGEMENT AND INTERNAL CONTROL
We operate within a complex regulatory environment, which is subject to change, and the nature of pharmaceutical development exposes us to a number of risks and uncertainties. These risks and uncertainties could adversely impact our ability to deliver our strategy, our business model and the environment in which we operate.
We have developed and implemented a risk management process which is designed to ensure that existing or emerging significant risks are identified, assessed, managed and reported to relevant stakeholders in a timely manner to inform and support decision making. Our risk management process aims to mitigate the significant risks that Vectura faces in accordance with our risk appetite. This strategy comprised a focus on relatively lower risk, high value development opportunities and ceasing investment in relatively higher risk, novel molecule and early stage programmes. The process has been in place for the year under review, and up to the date of approval of the Annual Report and Accounts.
It is recognised that no risk management process can provide absolute assurance against loss.
This section provides an overview of our risk management process, the key risks faced by the business and the actions that we have taken to mitigate them. Not all the risks identified as part of our risk management processes are detailed in this section; instead this report focuses on those risks that the Directors believe to be the most important and which could cause Vectura's results to differ materially from expected and historical results and significantly impact our strategy. Not all of these risks are within the control of the Group and other factors besides those listed may affect the Group's performance. As with all businesses operating in a dynamic environment, some risks may not yet be known whilst other low level risks could become material in the future.
In response to the uncertainty and unknowns as to the terms of the UK exiting the EU following the referendum on 23 June 2016, an internal task force was formed comprising representation from the Group's Finance, Legal, Regulatory, Supply Chain and HR functions. The purpose of the task force was to identify risks and form risk mitigation strategies. This is within the context that, despite an expectation of a transition period post 29 March 2019, risk identification and mitigation should focus on the UK exiting the EU Single Market and EU Customs Union on 29 March 2019 ("hard Brexit") without a transition period. The task force updates the Executive Leadership Team and the Board. While the task force has focused on a hard Brexit scenario, Brexit could have many potential outcomes and it is impossible for all risks to be identified and mitigated, given the unprecedented level of uncertainty.
The Audit Committee reviews the effectiveness of Vectura's risk management and internal control at least annually, on behalf of the Board. This review has been undertaken during the year and the Board believes that it has taken all reasonable steps to satisfy itself that the risk management process is effective and fit for purpose. No material control weaknesses or deficiencies were identified as part of this review.
Our approach to assessing risk
Risk is assessed net of the application of current control activities using a standard matrix which considers the potential likelihood of a risk event occurring and the potential impact on the business were such an event to occur.
The output of this matrix allows the business to prioritise risks and mitigating actions.
Risks are considered within the timeframe of at least three years, which is the same period that has been used in the Viability statement.
How our principal risks have evolved during 2018
Part of the principal risk of "Failure or delay in partnering VR647 and VR475" materialised in 2018 following the VR475 Phase III study not meeting its primary endpoint and the decision not to pursue further development and partnering of VR475. The risk has therefore been renamed to "Failure or delay in partnering VR647".
As a consequence of further risk identification and risk mitigation planning and the increased likelihood of the UK exiting the EU without a transition arrangement, the Group's principal risk of "Brexit uncertainty" is replaced by two risks and the principal Group risks are now grouped between Brexit-related risks and non-Brexit-related risks.
Following increased focus on the Vectura enhanced therapies, with three new programmes targeting orphan or niche disease segments, a new risk has been added: "Failure to effectively scale up the manufacture of the Group's nebulised platforms for partnering".
All other principal risks have remained broadly unchanged in the year.
Principal risks
Principal risks specific to Vectura's business model - Brexit
Supply chain disruption in the short term from the UK exiting the EU in the event of a "hard Brexit" | ||
What is the risk?
The Group's largest product, flutiform®, is manufactured in the UK and commercialised by its partners in Europe, Japan and Rest of World. The Group imports raw materials into the UK and the Group's partners export flutiform® from the UK into overseas markets. Delays to the cross border movement of goods could disrupt the flutiform® supply chain.
While this risk is most significant to the supply of flutiform®, it is not exclusive to the product. The Group also supplies AKITA® devices, the BreelibTM device and the GyroHaler® device. However, these products are much less material to the Group's results.
Strategic priorities impact:
· Maximising partnering value · Strong financial performance · Operational excellence
Risk movement: Increasing as the likelihood of a "hard Brexit" is higher.
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What could cause the risk to be realised? | What would the impact be?
| How do we manage the risk?
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· Disruption at ports of entry and exit which significantly slow the movement of goods such that stocks of products in overseas markets cannot be sufficiently replenished, or imports of raw materials are limited, reducing manufacturing output below normal levels. · Alternative routings or methods of transportation may be unavailable. · New flutiform® release testing capability does not perform to the required level, slowing or reducing the release of batches into the EU.
| · Major disruption to the flutiform® supply chain could result in lost product supply revenues and lost in-market sales which generate royalties for Vectura. If in-market sales are lost, patients may switch to alternative products and not switch back when product availability returns.
| · Partners have reviewed stock levels in the light of Brexit risks, and stock levels have been increased where deemed appropriate. Mitigation of these risks is reviewed regularly by the Group and its partners. · The Group has reviewed its raw material inventory levels and has built stocks where appropriate. · Vectura, partners and suppliers have engaged third-party logistics providers with import and export expertise. · Alternative routings or methods of transportation available to Vectura, suppliers and partners have been reviewed and contingency plans developed. · Training of internal supply chain staff on import/export complexities has been undertaken. · Provision for flutiform® release testing in the EU has been implemented.
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Adverse regulatory changes resulting in higher operating costs over the short, medium and longer term
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What is the risk?
If the UK leaves the European Union without a withdrawal agreement, future trading with the EU and other countries may result in increased costs for Vectura, for example costs associated with the application of new import or export tariffs.
In addition, from a regulatory perspective, an EU legal entity is required for medicinal product and medical device submissions and clinical trials in the EU. Vectura also requires a notified body with a legal entity in the EU. A notified body conducts conformity assessments for European directives related to medical devices.
Strategic priorities impact:
· Operational excellence · Strong financial performance
Risk movement: Increasing as the likelihood of a "hard Brexit" is higher.
| ||
What could cause the risk to be realised? | What would the impact be? | How do we manage the risk? |
· The UK leaves the EU without a withdrawal agreement. · A beneficial trading relationship between the UK and EU is not established. · Insufficient expertise and resources are available to deal with increased compliance activity.
| · Trading with the EU without a withdrawal agreement could impact the Group as follows: · Tariffs on raw materials imported from the UK for flutiform® reducing product supply margins. These are incurred directly or via supplier price increases. · Additional testing or regulatory compliance costs to Vectura, which erode product supply margins. · Adverse regulatory changes increase cost of compliance, constraining funds for investment in research and development.
| · The Group has sought out guidance and intelligence from the relevant professional bodies and trade organisations to shape its planning. · The Group has established a legal entity within the EU to enable it to comply with EU regulations for medicinal products and devices. The Group has also appointed a new EU notified body. · The Group has established a capability to perform EU release testing post-Brexit. · Resource and training requirements have been assessed and actioned accordingly.
|
Principal risks specific to Vectura's business model - Non-Brexit
Supply chain disruption
| ||
What is the risk?
Vectura manages the supply chain for certain commercial products (flutiform®, AirFluSal® Forspiro® and Breelib™) and also relies on suppliers for the provision of quality compliant materials for R&D.
Strategic priorities impact:
· Operational excellence · Strong financial performance
Risk movement: Stable
| ||
What could cause the risk to be realised? | What would the impact be? | How do we manage the risk? |
· Supply chain disruption involving single point of failure for which Vectura has high dependency and limited resilience. · Supplier capacity constraints. · Supplier loss of licence or regulatory action impacting Vectura. · Termination of the manufacturing agreement with Recipharm for flutiform®. The agreement continues to 2020 and will be automatically renewed bi-annually unless terminated by either party within 24 months' notice. | · Major disruption to, or failure of, these supply chains, particularly for flutiform®, could result in lost revenues and business opportunities, stock shortages, liabilities and significant damage to profitability and prospects for Vectura. Such disruption could be either quality or capacity related.
| · Vectura has strong working relationships with its suppliers; we have established due diligence processes to ensure that our stringent quality standards are maintained and we have put in place appropriate systems that will provide an early warning of potential issues. · A dedicated Commercial Quality Director has oversight of release of commercial product and ensures appropriate management of quality for commercial products. · Monthly meetings are held to discuss customer demand forecasts and to review Vectura's ability to meet these forecasts. Vectura has established contingency arrangements to ensure that production capacities exceed forecast demand so that it would be possible to catch up on any shortfall in production or meet unexpected demand. Appropriate levels of safety stock are maintained. · Supply chain mapping has been undertaken, and is regularly reviewed, to identify potential points of failure and mitigating actions. Where economically feasible, additional sources of supply are established and contracts negotiated to include appropriate provisions for replacement of defective goods. · The Group also has appropriate insurance, but it is not possible to insure against all risks and not all insurable risks can be fully insured on an economically feasible basis.
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Failure or delay in partnering VR647 for Phase III development
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What is the risk? The Group plans to balance risk and value generation by partnering VR647 in 2019. Vectura may be unable to find a partner with suitable commercial strength and respiratory heritage for VR647 in a timely manner.
Strategic priorities impact:
· Maximising pipeline value · Strong financial performance
Risk movement: Stable
| ||
What could cause the risk to be realised? | What would the impact be? | How do we manage the risk? |
· Phase III study requirements are prohibitive. · Inability to identify a suitable partner. · Inability to negotiate a deal with commercially attractive terms. · Incorrect perception that VR475 Phase III results also impact VR647.
| · Failure to partner VR647 with a suitable partner in a timely manner or at all could materially impact future revenues, profitability and prospects of Vectura.
| · Vectura has acquired, developed and progressed VR647 based on its experience and knowledge of the respiratory market. As such, the Group believes that the products are well placed to capture value in an attractive niche market where relatively few competitors have relevant assets. · Vectura has dedicated, experienced personnel responsible for marketing assets to, and negotiating with, potential partners. In addition to its existing partner relationships, which have the potential to be extended to new projects, the Group also attends industry conferences and events where its programmes and technologies are marketed to new potential partners. · Vectura has and is executing a communication strategy following the adverse VR475 Phase III study results. This includes highlighting the very different patient populations and clinical endpoints between VR475 and VR647.
|
Failure to launch VR315 in a competitive timeframe
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What is the risk?
On 10 May 2017, our partner, Hikma Pharmaceuticals PLC ("Hikma") received a Complete Response Letter (CRL) from the US FDA in relation to its abbreviated new drug application for its generic version of GSK's Advair® Diskus®. This CRL has been categorised as "Major".
Hikma and Vectura have had constructive dialogue with the FDA to resolve the observations made in the CRL and the majority of questions raised have been addressed and clarified. Hikma is completing an additional clinical endpoint study (CEP) at the request of the FDA.
Strategic priorities impact:
· Maximising pipeline value · Strong financial performance
Risk movement: Stable
| ||
What could cause the risk to be realised? | What would the impact be? | How do we manage the risk? |
· VR315 not being the second generic of GSK's Advair® Diskus® product. · Sales (volumes and/or pricing) of GSK's Advair® Diskus® could decline faster than expected prior to launch of VR315.
| · Failure to complete the CEP in a timely manner could result in the product being launched later than those of competitors resulting in loss of potential future revenues and funds for investment. · Although Mylan received FDA approval for its generic of GSK's Advair® Diskus® at the end of January 2019, approval prior to VR315 had been anticipated by Vectura.
| · The Group is unable to take direct action to mitigate this risk. · A joint clinical team is in place to oversee the conduct of the study which is on track. The clinical trial results and resubmission to the FDA are expected later in 2019.
|
Partner failure
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What is the risk?
Vectura operates a partnering business model and is therefore reliant on partners for development, manufacturing and commercialisation of pipeline assets. In addition, Vectura earns revenues from a number of partnered on-market assets and is dependent upon those partners for maintaining regulatory approvals and for marketing of the products.
Strategic priorities impact:
· Maximising pipeline value · Maximising partnering value
Risk movement: Stable
| ||
What could cause the risk to be realised? | What would the impact be? | How do we manage the risk? |
· Change in partner strategy or priorities. · Partner trading issues/insolvency. · Partner's marketing, supply chain or commercialisation strategy is suboptimal or not executed successfully. · Partner failure to obtain appropriate pricing and reimbursement.
| · Failure by a strategic partner to deliver on their obligations during the development phase could result in a delay or cessation of development; this in turn could cause a delay in the product reaching the market which could undermine the product's commercial potential and result in lower returns on investment for Vectura. · The marketing, supply chain and commercialisation strategies deployed by partners for existing on-market products could materially impact the level of royalties and sales milestones earned by Vectura.
| · Vectura has a broad range of disclosed and undisclosed partners. · All collaborations are performed under a suitable legal agreement which is assessed by Vectura and its internal and external legal advisors. · Typically, for collaborations, a joint steering committee (JSC) is established involving both Vectura and partner personnel. This provides Vectura with a mechanism to ensure that any joint project activity is managed appropriately. Where the Group supplies product, regular operational meetings take place to review demand forecasts. · The Group also has a Commercial and Business Development department which maintains regular dialogue with existing and potential new partners.
|
Principal risks specific to the industry in which Vectura operates
Failure or delay in achieving development milestones required to advance the product pipeline
| ||
What is the risk?
Vectura increases the value potential of its research and development by successfully advancing its pipeline projects through the development cycle.
Failure or delay in achieving development milestones for the Group's generic programmes and new enhanced therapies targeting niche or orphan disease segments would impact the potential value of these programmes.
Strategic priorities impact: · Maximising pipeline value · Operational excellence · Maximising partnering value · Strong financial performance
Risk movement: Stable
| ||
What could cause the risk to be realised? | What would the impact be? | How do we manage the risk? |
· Manufacturing issues associated with a particular device or product for clinical trials. · Ineffective design and execution of clinical programmes and protocols. · Failure of outsourced provider of clinical trials. · Constraints in R&D capacity and investment. | · Pipeline failures or delays could materially impact the future revenues, profitability and prospects of Vectura.
| · Vectura has an established governance process to oversee the conduct and delivery of all development programmes and to ensure that any potential changes to the development plan or budget are identified and discussed in a timely manner such that mitigating activities or actions can be put in place as required. · Vectura works closely with expert regulatory advisors and, when appropriate, seeks advice from regulatory authorities on the design of key development plans for pre-clinical and clinical programmes. · Clinical trials are conducted in accordance with prevailing practice and statutory/regulatory requirements. · Individuals with the necessary skills and experience have been recruited to lead and oversee the development of our pipeline assets. Vectura continues to work with a network of experienced consultants and contractors which provide additional support and expertise as required. · Operational Excellence initiatives within the R&D function have been and continue to be implemented to maximise capacity in R&D. |
Failure to effectively scale up the manufacture of the Group's nebulised platforms for partnering
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What is the risk? In addition to VR647, the Group has added to its nebulised pipeline by starting development of three new Vectura enhanced therapies, targeting niche or orphan disease segments. Scaling up the Group's nebulisation platforms is critical to delivering value from these pipeline programmes.
Strategic priorities impact:
· Maximising pipeline value · Operational excellence · Maximising partnering value · Strong financial performance
Risk movement: Increasing following the announcement of the closure of the Group's German site in 2018 (site will be closed in 2021).
| ||
What could cause the risk to be realised? | What would the impact be? | How do we manage the risk? |
· Failure to transfer knowledge and skills to the UK from the Group's German site following the announcement of the German site closure in 2018 (site will be closed in 2021). · Failure to transfer manufacturing to a contract manufacturing partner.
| · Pipeline programmes may not be partnered resulting in failure to realise a return on investment. · The cost of manufacture may be too expensive which may limit or even prevent the commercial viability of the Group's pipeline programmes. | · In respect of the closure of the Group's German site: o a retention scheme is in place for key employees; o a transition team is in place; and o plans are in place to increase resources in the UK. · An outsourced manufacturing partner has been selected. Transition of knowledge to the supplier is ongoing. |
Changes in the regulatory, operating or pricing environment
| ||
What is the risk?
Vectura operates in the highly regulated international pharmaceutical industry which is subject to change.
Strategic priorities impact:
· Maximising pipeline value · Maximising partnering value · Strong financial performance
Risk movement: Stable
| ||
What could cause the risk to be realised? | What would the impact be? | How do we manage the risk? |
· Political change. · Competitor pricing strategies. · Regulatory action on pricing.
| · Changes in the pharmaceutical regulatory landscape, operational restrictions and downward pricing pressure could impact whether a development product can be developed into a viable marketable product and the amount of time and expenses associated with such development. · Even if products are approved, they may still face subsequent difficulties resulting in financial loss and reputational damage.
| · Regulatory changes tend to be slow due to lengthy consultations and discussions between regulators and the pharmaceutical industry. We work closely with expert regulatory advisors and, when appropriate, seek advice from regulatory authorities on the design of key development plans for pre-clinical and clinical programmes. · We work with a number of blue-chip pharmaceutical partners which have significant regulatory expertise. · Our business strategy includes investment in generic products which support government initiatives to reduce cost. |
Failure to attract or retain talent/key personnel
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What is the risk?
Vectura relies upon a number of key qualified management, scientific, technical, marketing and support personnel. Competition for such personnel is intense and there can be no assurance that the Group will be able to continue to attract and retain such personnel. Vectura does not believe Brexit, or immigration controls following the UK's departure from the EU, will increase this risk materially.
In 2018, Vectura announced plans to close its operations in Gauting, Germany, by 2021 with knowledge and skills to be transferred to the Group's sites in the UK.
Strategic priorities impact:
· Maximising pipeline value · Operational excellence · Great place to work
Risk movement: Stable
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What could cause the risk to be realised? | What would the impact be? | How do we manage the risk? |
· Inadequate succession planning/talent management. · Organisational disruption and/or change. · Failure to attract candidates of the correct calibre and, in particular, those candidates in the UK to be able to take on the knowledge and skills from the Gauting site. · Failure of reward/incentive strategy.
| · The loss of talent or key personnel could adversely impact the effectiveness of the Group's operations.
| · Vectura seeks to develop employees for current and future roles and our career development and talent management programmes remain a key area of focus for the Executive Leadership Team. We continue to invest in ongoing training and development. New leadership development training has been rolled out in 2018 and new manager development training has been developed and will be rolled out in 2019. · Succession plans for key roles have been developed to ensure a talent pool is identified, developed and ready for implementation. These plans include the identification of "emergency successors" in the case of unanticipated and immediate absence. · Vectura offers market-competitive reward packages and a clear career development framework. · Our multiple locations provide flexibility to target talent pools across a wide geography. · A retention scheme is in place for key Gauting site employees. In addition, a transition team is in place and plans are being executed to increase resources at the Group's UK sites to absorb knowledge and skills.
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Failure to protect intellectual property
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What is the risk?
Patent infringement by a competitor or partner or failure to obtain patents for Vectura-related development could impact on Vectura's ability to deliver its product pipeline or impact on-market products.
Strategic priorities impact:
· Maximising pipeline value · Operational excellence · Strong financial performance
Risk movement: Stable
| ||
What could cause the risk to be realised? | What would the impact be? | How do we manage the risk? |
· Competitor successful in challenging Vectura or partner patent. · Critical information missing from filed patent. · Partner failure to pay royalties on intellectual property licensed by Vectura. Vectura is currently taking action against GSK, claiming patent infringement following notification received from GSK in 2016 that it did not wish to exercise the option to take a licence to pay additional patents under the patent licence and option agreement with Vectura dated 5 August 2010 for GSK's Ellipta® products.
| · Such infringement or failure could result in Vectura or a partner having to take a licence to third-party IP in order to develop a product, or even being unable to commercialise a product, materially impacting Vectura's future revenues, profitability and prospects.
| · Dedicated internal resource, supplemented with external expertise, files for and prosecutes patents and other forms of intellectual property. · In conjunction with our partners where relevant, Vectura takes steps to enforce these rights. · Third-party rights that may be of interest to and/or have adverse effects on Vectura's activities are also monitored so that action can be initiated where appropriate. |
RELATED-PARTY TRANSACTIONS
Associates
In August 2018, the Group paid a final instalment of £150,000 to a German supplier on confirmation that a new Clickhaler® and Duohaler® cap filling and assembly line has received formal factory acceptance testing clearance and has been shipped to the Group's Chinese associate.
Remuneration of key management personnel
The remuneration of the Directors, who are the key management personnel of the Group, was £2.4m and is set out below:
| Year ended 31 December 2018 £m | Year ended 31 December 2017 £m |
Short-term employee benefits | 0.8 | 1.0 |
Annual incentive plan | 0.7 | 0.7 |
Non-Executive Directors' fees | 0.5 | 0.4 |
Post-employment benefits | 0.1 | 0.2 |
Other | 0.3 | 0.3 |
Total remuneration of key management personnel | 2.4 | 2.6 |
Please refer to the Remuneration Report for the remuneration of each Director.
Directors' responsibilities statement
The Directors are responsible for preparing the Annual Report and the Group and parent company financial statements in accordance with applicable law and regulations.
Company law requires the Directors to prepare Group and parent company financial statements for each financial year. Under that law they are required to prepare the Group financial statements in accordance with International Financial Reporting Standards as adopted by the European Union (IFRSs as adopted by the EU) and applicable law and have elected to prepare the parent company financial statements in accordance with UK accounting standards, including FRS 101 - Reduced Disclosure Framework.
Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Group and parent company and of their profit or loss for that period. In preparing each of the Group and parent company financial statements, the Directors are required to:
· select suitable accounting policies and then apply them consistently;
· make judgements and estimates that are reasonable, relevant, reliable and prudent;
· for the Group financial statements, state whether they have been prepared in accordance with IFRSs as adopted by the EU;
· for the parent company financial statements, state whether applicable UK accounting standards have been followed, subject to any material departures disclosed and explained in the parent company financial statements;
· assess the Group and parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern; and
· use the going concern basis of accounting unless they either intend to liquidate the Group or the parent company or to cease operations, or have no realistic alternative but to do so.
The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the parent company's transactions and disclose with reasonable accuracy at any time the financial position of the parent company and enable them to ensure that its financial statements comply with the Companies Act 2006. They are responsible for such internal control as they determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error, and have general responsibility for taking such steps as are reasonably open to them to safeguard the assets of the Group and to prevent and detect fraud and other irregularities.
Under applicable law and regulations, the Directors are also responsible for preparing a strategic report, directors' report, directors' remuneration report and corporate governance statement that comply with that law and those regulations.
The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company's website. Legislation in the UK governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.
Responsibility statement of the Directors in respect of the annual financial report
We confirm that to the best of our knowledge:
· the financial statements, prepared in accordance with the applicable set of accounting standards, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Company and the undertakings included in the consolidation taken as a whole; and
· the Strategic report includes a fair review of the development and performance of the business and the position of the issuer and the undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that they face.
We consider the Annual Report and Accounts, taken as a whole, is fair, balanced and understandable and provides the information necessary for shareholders to assess the Group's position and performance, business model and strategy.
James Ward-Lilley Paul Fry
Director Director
25 March 2019 25 March 2019
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