20th Dec 2010 07:00
AorTech International Plc ("AorTech" or the "Company")
Interim Results
AorTech International Plc (AIM: AOR) the biomaterials and medical device development company, today announces its unaudited interim results for the six months ended 30 September 2010.
CHAIRMAN'S STATEMENT
I am pleased to report that during the first half of the Financial Year 2010/11, the AorTech Group has continued to achieve technical and commercial progress.
FINANCIAL REVIEW
During the six month period, Group revenue rose to £674,000 from the £191,000 recorded during the corresponding period of the previous Financial Year. Operating expenses for the half-year increased by 9% to £1.82m; this included £693,000 of development expenditure (H1 2009: £515,000) and £116,000 amortisation of intangible assets (H1 2009: £108,000). The loss after tax for the six months was £1.01m, a reduction of £364,000 against the £1.38m loss figure recorded during the corresponding period of the previous year.
CURRENT OPERATIONS
An announcement by St. Jude Medical on 15 December 2010 informing doctors of its plan to phase out all other lead types other than those insulated with Optim™ (Elast-Eon™) on the basis of 44 months of clinical usage and a greater than 80% reduction in abrasion related failures is a powerful endorsement and validation of the superb clinical performance of AorTech polymers. More generally, our polymer business has continued to make commercial and technical progress with the increasing number of evaluations of our already widely-used polymer Elast-Eon™ and our new product, ECSil™. This has occurred through the addition of new customers such as Teleflex Incorporated who are expected to add significant volumes with their urologic catheter application, as regulatory approvals are granted and manufacturing lines scale up during 2011. Even more encouraging is the recent announcement of the first human use of our pacemaker / neurostimulation header technology. Our proprietary header technology is an important facet of our burgeoning component business which we see as having revenue potential several times greater than our base polymer business in the medium term.
Our component business is leveraging the clincal success of our polymer systems as well as our proprietary small part reaction injection moulding process (RIM) in customer evaluations of spinal disc, cardiac surgery, intramedullary nail and vascular graft products.
Progress also continues to be made with the use of our polymer heart valve application in the Syncardia total artificial heart (TAH2). A successful animal trial was recently conducted in Paris which validated the performance of our polymer heart valve ('PHV') in the artificial heart application. Remaining pre-clinical testing is anticipated to be completed in the first quarter of 2011 and first human use of the PHV in the artificial heart is expected in the second half of 2011. A futher application of this PHV technology, which has been licensed to a separate customer, continues to progress.
Jon Pither - Chairman
-Ends-
For further information please contact:
AorTech International plc
Frank Maguire, Chief Executive
Tel: + 1 801 201 4336
Evolution SecuritiesBobbie Hilliam / Chris Clarke
Tel: +44 20 7071 4300
AorTech International plc
Sarah Price, Investor Relations
Tel: + 1 801 550 4349
e-mail [email protected]
ABOUT AORTECH
AorTech develops and manufactures biostable, implantable polymers, including Elast-Eon™ and ECSil™, the world's leading long-term implantable co-polymers. With more than 3 million implants and over four years of successful clinical use, AorTech polymers are currently used in cardiology, orthopaedic, urological and gastroenterological applications, including pacing leads, cardiac cannulae and stents. Devices manufactured from AorTech polymers have numerous US FDA PMA approvals, 510k's, CE Marks, Australian TGA and Japanese Ministry of Health approvals.
Elast-Eon™ and ECSil's™ biostability is comparable to silicone while exhibiting excellent mechanical, blood contacting and flex-fatigue properties. Our polymers can be processed using solution casting, ERIM and conventional thermoplastic extrusion and molding techniques. AorTech provides a range of materials in a variety of application-specific formulations for use in medical devices and components.
CONDENSED CONSOLIDATED INTERIM INCOME STATEMENT | |||||||
Six months ended 30 September 2010 | |||||||
(Unaudited) | Six months to 30 Sept 2010 | Six months to 30 Sept 2009 | Twelve months to 31 March 2010 | ||||
£000 | £000 | £000 | |||||
Revenue | 674 | 191 | 1,362 | ||||
Other income - grants received | 80 | 49 | 306 | ||||
Cost of sales | (167) | (117) | (382) | ||||
Administrative expenses | (841) | (924) | (2,082) | ||||
Other expenses - development expenditure | (693) | (515) | (1,121) | ||||
Other expenses - amortisation of intangible assets | (115) | (108) | (142) | ||||
Operating loss | (1,062) | (1,424) | (2,059) | ||||
Finance income | 48 | 46 | 136 | ||||
Loss before taxation | (1,014) | (1,378) | (1,923) | ||||
Taxation | - | - | - | ||||
Loss for the financial period | (1,014) | (1,378) | (1,923) | ||||
Loss per share (basic and diluted) - pence | (20.98) | (28.51) | (39.79) | ||||
CONDENSED CONSOLIDATED INTERIM STATEMENT OF COMPREHENSIVE INCOME | |||||||
Six months to 30 Sept 2010 | Six months to 30 Sept 2009 | Twelve months to 31 March 2010 | |||||
£000 | £000 | £000 | |||||
Loss for the period |
(1,014) |
(1,378) |
(1,923) | ||||
Other comprehensive income: | |||||||
Exchange differences on translating foreign operations |
11 |
(415) |
1,204 | ||||
Income tax relating to other comprehensive income | - | - | - | ||||
Other comprehensive income for the period, net of tax |
11 |
(415) |
1,204 | ||||
Total comprehensive income for the period, attributable to equity holders of the parent |
(1,003) |
(1,793) |
(719) | ||||
CONDENSED CONSOLIDATED INTERIM BALANCE SHEET | |||||||
(Unaudited) | 30 Sept 2010 | 30 Sept 2009 | 31 March 2010 | ||||
£000 | £000 | £000 | |||||
Assets | |||||||
Non current assets | |||||||
Property, plant and equipment | 673 | 753 | 718 | ||||
Intangible assets | 1,369 | 1,357 | 1,424 | ||||
Total non current assets | 2,042 | 2,110 | 2,142 | ||||
Current assets | |||||||
Inventories | 121 | 165 | 150 | ||||
Trade and other receivables | 615 | 202 | 859 | ||||
Cash and cash equivalents | 2,241 | 3,517 | 2,885 | ||||
Total current assets | 2,977 | 3,884 | 3,894 | ||||
Total assets | 5,019 | 5,994 | 6,036 | ||||
Liabilities | |||||||
Current liabilities | |||||||
Trade and other payables | (609) | (550) | (623) | ||||
Total current liabilities | (609) | (550) | (623) | ||||
Non current liabilities | |||||||
Other non current liabilities | - | (46) | - | ||||
Total non current liabilities | - | (46) | - | ||||
Total liabilities | (609) | (596) | (623) | ||||
Net assets | 4,410 | 5,398 | 5,413 | ||||
Equity | |||||||
Issued capital | 12,082 | 12,082 | 12,082 | ||||
Share premium | 2,340 | 2,340 | 2,340 | ||||
Other reserve | (2,003) | (2,003) | (2,003) | ||||
Foreign exchange reserve | 1,873 | 1,302 | 1,862 | ||||
Profit and loss account | (9,882) | (8,323) | (8,868) | ||||
Equity shareholders' funds | 4,410 | 5,398 | 5,413 | ||||
CONDENSED CONSOLIDATED INTERIM CASH FLOW STATEMENT |
| ||||||||||
(Unaudited) | Six months to 30 Sept 2010 | Six months to 30 Sept 2009 | Twelve months to 31 March 2010 | ||||||||
£000 | £000 | £000 | |||||||||
Cash flows from operating activities | |||||||||||
Group loss after tax | (1,014) | (1,378) | (1,923) | ||||||||
Adjustments for: | |||||||||||
Depreciation of property, plant and equipment | 101 | 120 | 258 | ||||||||
Amortisation of intangible assets | 115 | 108 | 142 | ||||||||
Interest income | (48) | (46) | (136) | ||||||||
Deferred income released | (42) | (33) | (79) | ||||||||
Decrease/(increase) in trade and other receivables | 244 | 234 | (423) | ||||||||
Decrease/(Increase) in inventories | 29 | (15) | - | ||||||||
(Decrease)/Increase in trade payables | (14) | 38 | 111 | ||||||||
Net cash flow from operating activities | (629) | (972) | (2,050) | ||||||||
Cash flows from investing activities | |||||||||||
Purchase of property, plant and equipment | (48) | (51) | (102) | ||||||||
Interest received | 48 | 46 | 136 | ||||||||
Net cash flow from investing activities | - | (5) | 34 | ||||||||
Net cash flow from financing activities | - | - | - | ||||||||
Net decrease in cash and cash equivalents | (629) | (977) | (2,016) | ||||||||
Foreign exchange differences | (15) | 316 | 723 | ||||||||
Cash and cash equivalents at beginning of period | 2,885 | 4,178 | 4,178 | ||||||||
Cash and cash equivalents at end of period | 2,241 | 3,517 | 2,885 | ||||||||
CONDENSED CONSOLIDATED INTERIM STATEMENT OF CHANGES IN EQUITY
| |||||||||||||
(Unaudited) | Share capital | Share premium account | Other reserve | Foreign exchange reserve | Profit and loss account | Total equity | |||||||
£000 | £000 | £000 | £000 | £000 | £000 | ||||||||
Balance at 1 April 2009 | 12,082 | 2,340 | (2,003) | 658 | (6,945) | 6,132 | |||||||
Changes in equity for first half of FY 2009/10 | |||||||||||||
Exchange difference on translationof foreign operations | - | - | - | 644 | - | 644 | |||||||
Net expense recognised directly in equity | - | - | - | 644 | - | 644 | |||||||
Loss for the period | - | - | - | - | (1,378) | (1,378) | |||||||
Total comprehensive income for the period | - | - | - | 644 | (1,378) | 734 | |||||||
Balance at 30 September 2009 | 12,082 | 2,340 | (2,003) | 1,302 | (8,323) | 5,398 | |||||||
Changes in equity for second half of FY 2009/10 | |||||||||||||
Exchange difference on translationof foreign operations | - | - | - | 560 | - | 560 | |||||||
Net income recognised directly in equity | - | - | - | 560 | - | 560 | |||||||
Loss for the period | - | - | - | - | (545) | (545) | |||||||
Total comprehensive income for the period | - | - | - | 560 | (545) | 15 | |||||||
Balance at 31 March 2010 | 12,082 | 2,340 | (2,003) | 1,862 | (8,868) | 5,413 | |||||||
Changes in equity for first half of FY 2010/11 | |||||||||||||
Exchange difference on translationof foreign operations | - | - | - | 11 | - | 11 | |||||||
Net income recognised directly in equity | - | - | - | 11 | - | 11 | |||||||
Loss for the period | - | - | - | - | (1,014) | (1,014) | |||||||
Total comprehensive income for the period | - | - | - | 11 | (1,014) | (1,003) | |||||||
Balance at 30 September 2010 | 12,082 | 2,340 | (2,003) | 1,873 | (9,882) | 4,410 | |||||||
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS |
1. BASIS OF PREPARATION |
These condensed consolidated interim financial statements are for the six months ended 30 September 2010, and have been prepared with regard to the requirements of IAS 34 on "Interim Financial Reporting". They do not include all of the information required for full financial statements, and should be read in conjunction with the consolidated financial statements of the Group for the year ended 31 March 2010. |
These condensed consolidated interim financial statements have been prepared in accordance with the accounting policies set out below which are based on the recognition and measurement principles of IFRS in issue as adopted by the European Union (EU) and effective at 31 March 2011 or are expected to be adopted and effective at 31 March 2011. They were approved for issue by the Board of Directors on 9 December 2010. |
The accounting policies have been applied consistently throughout the Group for the purposes of preparation of these condensed consolidated interim financial statements. |
The financial information for the six months ended 30 September 2010 and the comparative figures for the six months ended 30 September 2009 are unaudited and have been prepared on the basis of the accounting policies set out in the consolidated financial statements of the Group for the year ended 31 March 2010. This financial information does not constitute statutory accounts as defined in Section 434 of the Companies Act 2006. The financial statements for the year ended 31 March 2010, prepared under IFRS, received an unqualified audit report, did not contain statements under sections 498(2) and 498(3) of the Companies Act 2006 and have been delivered to the Registrar of Companies. |
Loss per share has been calculated on the basis of the result for the period after tax, divided by the weighted average number of ordinary shares in issue in the period of 4,832,778. The comparatives are calculated by reference to the weighted average number of ordinary shares in issue which were 4,832,778 for the period to 30 September 2009 and 4,832,778 for the year ended 31 March 2010. |
2. SEGMENTAL REPORTING | |||||||
The principal activity of the AorTech International Plc Group currently is the development and exploitation of a range of innovative biomaterials. | |||||||
All revenue during the first six months of financial year 2010/11 originated in Australia. | |||||||
(Unaudited) | |||||||
Six months to 30 Sept 2010 | Six months to 30 Sept 2009 | Twelve months to 31 March 2010 | |||||
£000 | £000 | £000 | |||||
Analysis of revenue by destination | |||||||
Geographical segments | |||||||
United Kingdom | 3 | 4 | 29 | ||||
Australia | - | - | 2 | ||||
USA and Rest of the World | 671 | 187 | 1,331 | ||||
674 | 191 | 1,362 | |||||
Analysis of result - operating loss | |||||||
Geographical segments | |||||||
United Kingdom | (205) | (168) | (356) | ||||
Australia | (604) | (1,026) | (1,234) | ||||
USA and Rest of the World | (253) | (230) | (469) | ||||
(1,062) | (1,424) | (2,059) | |||||
3. ADDITIONS TO AND AMORTISATION OF INTANGIBLE ASSETS | ||||||||
The following table shows the significant additions to and amortisation of intangible assets | ||||||||
(unaudited) | Intellectual property | |||||||
£000 | ||||||||
At 1 April 2009 | 1,257 | |||||||
Exchange rate adjustment | 208 | |||||||
Amortisation | (108) | |||||||
At 30 September 2009 | 1,357 | |||||||
Exchange rate adjustment | 101 | |||||||
Amortisation | (34) | |||||||
At 1 April 2010 | 1,424 | |||||||
Exchange rate adjustment | 60 | |||||||
Amortisation | (115) | |||||||
At 30 September 2010 | 1,369 | |||||||
Corporate information and advisers
Directors
Jon Pither non-Executive Chairman
Frank Maguire Chief Executive
Eddie McDaid non-Executive Director
Dr Stuart Rollason non-Executive Director
Gordon Wright non-Executive Director
Company Secretary
David Parsons ACIS
Registered Office
C/o Brodies LLP
2 Blythswood Square
Glasgow G2 4AD
Head Office
Prestige Travel Suite
Barclays Bank House
81-83 Victoria Road
Surbiton
Surrey KT6 4NS
web: www.aortech.com
email: [email protected]
Nominated Adviser and Broker
Evolution Securities Limited
100 Wood Street
London EC2V 7AN
Registrars
Equniti Limited
1st Floor34 South Gyle CrescentSouth Gyle Business ParkEdinburgh EH12 9EB
Independent Auditor
Grant Thornton UK LLP
Statutory Auditors
Chartered Accountants
Regent House
80 Regent Road
Leicester LE1 7NH
Registered in Scotland, Company No.170071
Interim results will be circulated to Shareholders and copies of the announcement will be made available from the Company's registered office. Dealings permitted on Alternative Investment Market (AIM) of the London Stock Exchange.
Related Shares:
AOR.L