Audited results for the year ended 31 March 2016

Rex Bionics Plc

("Rex Bionics" or the "Company")

Audited results for the year ended 31 March 2016

26 August 2016: Rex Bionics plc (AIM: RXB), the pioneer of the REX Robot technology that enhances the mobility of wheelchair users, today announces its audited results for the year ended 31 March 2016.

Post-period operational highlights:

· Strategic re-positioning, emphasising the unique benefits of REX for patients with the most severe spinal cord injury and rehabilitation-resistant stroke;

· Equity fundraising completed 10 August 2016 raising £2.3 million before expenses, to be used to maintain commercial momentum during strategic re-positioning and review of further fundraising opportunities;

· Fundraising included £1m investment by Maxhealth Medicine Group Co., Ltd, a large regional medical equipment distributor in China associated with the Company's exclusive distributor MAAB International;

· Data from 2nd interim analysis of results from RAPPER II clinical trial presented 17 August 2016: now includes 53 participants, with positive results maintained;

· Agreement signed with Avicenna Partners, based in Dubai, to provide Robot Assisted Physiotherapy with REX in the United Arab Emirates

Previously announced operational highlights:

· Sales of seven REX units in the year (US: two, Asia: three, UK: one, Australia: one), representing maiden sales of the product since the Company's IPO;

· Key partnership and distribution agreements signed in the US, China, Hong Kong and Europe, opening up access to some of the world's largest markets;

· First ever successful personal injury claims awarding insurance funding for wheelchair users to access REX;

· Highly positive results from an interim analysis of data from the RAPPER II clinical trial announced in late 2015;

· Successful demonstration of the direction of REX by mind control technology at the 2015 Meeting of Robotics: Science and Systems in Rome;

· Announcement of collaboration with US Army to evaluate use of REX for the early rehabilitation of amputees in an acute care setting;

· Appointment of Joseph Cucolo, ex-President Americas for Zimmer Corporation, as the Company's first US-based Non-Executive Director

Results for the period:

· Net loss £4.87 million (16 months to 31 March 2015 - net loss £5.30 million);

· Period-end available cash reserves £1.86 million (31 March 2015: £4.37 million)

For further information please contact:

Rex Bionics Plc

Crispin Simon, Chief Executive Officer

+44 (0) 781 086 6386

Peter Worrall, Chief Financial Officer

+44 (0)1428 645416

Stifel Nicolaus Europe Limited (NOMAD and Broker)

Jonathan Senior/ Stewart Wallace / Ben Maddison

+44 (0) 20 7710 7600

Consilium Strategic Communications

Mary-Jane Elliott / Chris Welsh

[email protected]

+44 (0) 203 709 5700

About Rex Bionics Plc

Rex Bionics (AIM: RXB) is the pioneer of the REX Robot that enhances the mobility of wheelchair users and was founded in Auckland, New Zealand by two robotics engineers with first-hand experience of wheelchair users and their needs. 

Rex Bionics is working with physiotherapists to develop the concept and practice of Robot-Assisted Physiotherapy (RAP). In a session of RAP, REX lifts patients from a sitting position into a robot-supported standing position, allowing them to take part in a set of supported walking and stretching exercises, designed by specialist physiotherapists. 

In addition, REX P, for use in the home, enables users to walk and stand with their hands free - providing more work and recreation options. Our vision is to commercialise an all-day use REX P for a target market segment of wheel chair users with a spinal cord injury, who number around 500,000 people in the US and EU alone. The market potential for this new category of robotic mobility aid was recently estimated to be $2.1 billion in 2021, by Wintergreen Research Inc.

Wheelchair users are at risk of developing numerous medical complications from extended periods of sitting. By enabling them to spend more time standing, walking and exercising, REX may offer significant health benefits, including improved sleep and maintenance of joint range, and a reduction in spasm, pain, common abdominal problems and prescription drug use.

A program of "RAPPER" clinical trials is now under way to evaluate these potential benefits and the first and second interim analysis of the RAPPER II data were presented on 27th November 2015 and 17th August 2016 respectively.

Until now, REX has most commonly been used by wheelchair users with a spinal cord injury, but has also been used by people who have suffered a stroke or other traumatic brain injury; and wheelchair users with multiple sclerosis, muscular dystrophy and cerebral palsy.

Rex Bionics has three Strategic Objectives - to establish Robot-Assisted Physiotherapy as a Gold Standard of Care for Spinal Cord Injury, Stroke and other neurological conditions; to establish REX as the market-leading robotic mobility aid; and by effective execution of our plans, to deliver significant value growth to shareholders. 

Rex Bionics works with distribution partners in the US ([email protected]), China (MAAB, [email protected]), Hong Kong and Taiwan (Deltason, [email protected]), Denmark and Belgium; and in other countries we support customers directly ([email protected]). 

Rex Bionics was admitted to trading on the London Stock Exchange's AIM in 2014. REX is not registered for At-Home use in the United States of America.

Chairman and Chief Executive's Joint Statement

Operationally, the year ended 31 March 2016 has been a period of broad progress across all areas, and we are pleased to be able to report to shareholders on the achievement of a number of important milestones during the period, including the first sales of REX since the Company's IPO, the first successful award under a personal injury claim to include a REX, the appointment of exclusive distributors in the Company's two most important markets, the US and China, and highly positive results from an interim analysis of the RAPPER II clinical trial looking at the feasibility and safety of the use of REX by people with spinal cord injury. As described in our Interim Results announcement in December 2015, we believe that the Company is now demonstrating how REX fits into a new paradigm for the use of robot technology in the rehabilitation of people with mobility impairment.

Sales and Marketing Activities

Product sales

We reported sales of REX of seven units in the year, the first sales of REX since the Company's IPO, with a broad geographic spread across the US, Asia-Pacific and Europe and higher sales in the second half year than the first half. With hindsight the sales cycle for REX has been longer than we initially expected, reflecting both the pressure on healthcare budgets around the world and also the fact that REX together with other exoskeleton products is creating a completely new market segment, which always takes time to develop. With sales and marketing activities now beginning to bear fruit, however, we expect revenues to continue to grow.

Distributor appointments

A critical objective of the Company's sales and marketing strategy has been the establishment of a network of specialised distributors and commercial partners in our key target markets around the world to support the international commercialisation of REX. We have made good progress over the year, with appointments in the US, China, Hong Kong, Scandinavia, the Benelux countries and Russia. More recently, in May 2016, we announced the appointment of a new agency agreement with Avicenna Partners in the United Arab Emirates, our first commercial partner in the Middle East, and we intend to make further appointments during the forthcoming year.

The early appointment of experienced partners in the US and China was particularly important, given the size and commercial significance of those markets. Our distributor in the US, appointed in September 2015, is EnableMe (formerly Ri LLC), a specialist supplier of movement therapy equipment to neuro-rehabilitation clinics throughout the US. Headquartered in St Petersburg, Florida, EnableMe was established in 2003 by Mike Laky, a seasoned rehabilitation industry specialist, and already has long-term contracts in place with the leading US hospital chains including the Veterans Administration, HealthSouth and Select Healthcare. With a network of sales representatives in the field, it offers broad geographic coverage for Rex products across the US, as well as providing the required FDA-compliant regulatory systems.

Our commercial partner in China, appointed in July 2015, is MAAB Group, an investment and trading company that specialises in sourcing and bringing innovative medical technologies into China. MAAB is headquartered in Hong Kong and was founded by industry veterans with a mix of expertise ranging from market access to sales and marketing. It is currently the appointed China partner and distributor for a number of cutting edge medical devices and diagnostic products from the UK, New Zealand and Denmark.

Under the terms of the collaboration, MAAB will manage the application process for China Food and Drug Administration (CFDA) for any regulatory approvals required for REX in the Chinese market, as well as the sales, marketing and distribution of the product. An initial product launch was held in early 2016 and limited pre-marketing of REX in the Chinese market is now underway (within the restrictions set by CFDA).

The rapid growth of China's emerging middle class, coupled with the Chinese government's increasing commitment to improving healthcare access, has led to a sharp increase in the demand for care in China, which we believe represents a clear opportunity for REX. The strategic investment of £1m by MAAB's associate Maxhealth Medicine Group Co., Ltd, a publicly quoted regional distributor of healthcare products in Eastern China, as part of the fundraising completed by the Company on 10 August 2016 provides evidence of MAAB and Maxhealth's confidence in the potential for REX in the Chinese market.

Most recently we announced a new agreement with Avicenna Partners in Dubai to provide Robot Assisted Physiotherapy with REX throughout the United Arab Emirates. Avicenna owns and operates the Amana Healthcare Rehabilitation Hospital, an Abu Dhabi-based neuro-rehabilitation clinic, and has plans to open further rehabilitation hospitals in the UAE. This is the Company's first formal collaboration in the Middle East and represents an ideal base from which to develop our business in that region.

Collaboration with the US Army

In another potentially significant development, we were pleased to announce in January 2016 a Collaborative Research and Development Agreement (CRADA) with the US Army Medical Research and Materiel Command to modify the REX technology to enable an evaluation of its use in the early ambulation of patients with lower limb loss.

After limb trauma and limb amputation, ambulation is limited in the early months due to the length of time post-injury, as much as three months, that is required to allow for residual limb tissue recovery before the socket and prosthetic fitting process can begin. The US Army has been investigating ways in which soldiers with limb loss could benefit from being upright while awaiting prosthetic fitting and from improved access to early and intensive standing rehabilitation, which it believes offers the prospect of shorter rehabilitation times and decreased complications of prolonged immobility. It concluded, however, that there are currently no devices to accommodate early standing for patients with limb loss.

This new agreement therefore sets the stage for follow-on research at the Walter Reed National Military Medical Center (WRNMMC), Bethesda, MD, which will consist of a program of design modifications to REX, specifically to its harness system, to enable its use by individuals who have suffered lower limb loss. If successful, it would represent the first use of REX in an acute care setting, which could open up a substantial new market opportunity for the product.

Marketing activities

During the year, the Company has continued to pursue a focused but highly active marketing and PR campaign to create greater international awareness of REX. We have exhibited at a number of major international neuro-rehabilitation conferences, including in Boston, Dallas, Dubai, Rome, and Shanghai, where we were honoured to receive a visit to our stand by His Royal Highness Prince William. REX has also made regular appearances on local and national television programs in a number of countries during the year, including an appearance on the Canadian version of Dragon's Den, in which a REX user standing in his REX made a successful pitch to the Canadian Dragons to provide financial backing for him to open a private rehabilitation clinic. More recently in the US, demonstrations of REX in Michigan and Florida were covered by local television news channels in those states. A recent story about a UK man who used a REX to walk his daughter down the aisle at her wedding received international coverage.

Personal injury claims

An area of increasing commercial focus for the Company is the potential for funding for one or more REXs to be included as part of the settlement under a personal injury insurance claim. Evidence for the significant opportunity that this represents was provided by the announcement in September 2015 that Ben Barnes, who sustained a spinal cord injury in a road traffic accident, had become the first recipient of a British High Court damages settlement enabling him to purchase his own REX for use at home. As part of his overall settlement, Mr Barnes was awarded a total of £550,000 for orthotics, which included the cost of a REX for home rehabilitation, its replacements and associated costs.

In another UK case during the year, a man who had sustained spinal cord damage as a result of alleged clinical negligence was awarded interim funding for an intensive course of robot-assisted physiotherapy with REX, pending a final settlement of his insurance claim. 

The Company views these awards as an endorsement from the courts and the insurance industry of the principle that the REX robot technology can help people with spinal cord injuries to remain healthy and enable them to resume activities they may have thought were no longer within their capabilities.

NZ Government funding to support US commercial development

We are grateful to the Callaghan Institute, an arm of the New Zealand Government, for its continued support throughout the year to the Company's Auckland-based subsidiary Rex Bionics Ltd, in the form of R&D grant funding for the next generation REX program. During the period we were also delighted to receive formal notification from New Zealand Trade and Enterprise, the New Zealand government's international business development agency, that it will provide up to NZD100,000 in funding to support the development of the Rex business in the US market.

Clinical Data

Another strategic imperative during the year has been the commencement of a series of post-marketing trials designed to generate clinical data to support the use of REX and its commercialisation in a range of clinical indications.

In June 2015 the Company announced the enrolment of the first recruit in our RAPPER II (Robot-Assisted PhysiotheraPy Exercises with REX) clinical trial, the first substantive, controlled study in this program. The objective of the RAPPER II study is to evaluate the safety and feasibility of a set of customised exercises performed in a REX.

Recruitment rates at the first trial centre, PhysioFunction in Northampton, UK, were rapid, and recruitment has accelerated in recent months with the addition of new trial centres at major neuro-rehabilitation units in the UK, Australia and New Zealand, establishing RAPPER II as a genuinely international clinical trial. We expect all of these sites, and others, to continue to act as Reference Centres for REX.

Highly positive results from an interim analysis of data from the first 20 volunteers to be recruited into the trial were presented at international neuro-rehabilitation conferences in Perth, Australia and Vienna in late 2015. Key findings from this first interim analysis included the following:

· 19 out of 20 volunteers (95%) were able to complete the walk/exercise protocol ("Treatment Success"), which was the primary end-point of the trial;

· The mean time from transfer to mobilisation was seven minutes and in less than ten minutes all the users were able to use the joystick to control the REX;

· There were no Serious Adverse Events and no treatment-related Adverse Events.

We are very encouraged by the outcome, which we believe provides compelling evidence that the REX can be used safely by most people with a spinal cord injury, and requires only brief and simple training to be used successfully.

In addition to the formal study end-points, all the volunteers who completed the treatment were asked to respond to a 16 item questionnaire covering aspects of their experience of using the REX. Overall, 84% of all the volunteers' answers to all of the questions were positive.  In answers to specific questions, 100% of volunteers could "see the benefits of using REX regularly", 95% "would like to use REX on a weekly basis", and 79% of volunteers "felt a sense of wellness after using REX". Responses to questions relating to Confidence, Safety, Stability, Comfort and Ease of Control of REX were in the 84-95% positive range.

The pattern of responses suggests that the REX will be able to deliver the proven benefits to wheelchair users of standing and walking, and they will provide important support to take to reimbursement agencies.

The results from the interim analysis of the RAPPER II trial data represent a first step in generating the clinical data that the Company believes will form an essential part of the commercial strategy for REX. In the subsequent cohort of recruits we have expanded the study protocol to include new, more detailed questionnaires and an extended, two-day and seven-day follow-up.

Enrolment in the RAPPER II study now exceeds 50, and a second interim analysis of the results was presented on 17 August 2016 at the 2016 meeting of the Military Health System Research Symposium in Orlando, Florida, US, which confirmed that the positive results seen with the first 20-volunteer cohort have been maintained, with a 96% Treatment Success and no Serious Adverse Events. Of particular note was that out of a total of 53 participants, 15 were quadriplegic, with 38 paraplegic, and the results were essentially the same. This confirms that the benefits of the REX technology are available to people with more severe injuries, in the Cervical 4-7 range in the spinal column, as well as in other cases of severe neurological impairment.

The investigators have now agreed that, in view of the strength and clarity of the data, the trial should be closed. The final steps for RAPPER II are the presentation of the Quality of Life data at the American College of Rehabilitation Medicine's 93rd Annual Conference (30 October - 4 November 2016) in Chicago, Illinois, US; and the publication of the trial results in a peer-reviewed journal, expected in 2017. 

Technology Update

Research and development efforts over the year have focused on design improvements to the current product line in parallel with continued work on the mechanical and operating system platform for the next generation of REX robots.

A highlight was the successful demonstration of the direction of REX by "Mind Control" technology at the 2015 Meeting of Robotics: Science and Systems in Rome, in which Robert Camm, a 21 year-old quadriplegic man from Gloucestershire, UK, with a C3 level complete spinal injury, walked in the REX while in complete and sole control of the device. The Mind Control technology used at this conference was developed by the Company's collaborators at the Laboratory for Non-invasive Brain-Machine Interface Systems, Department of Electrical and Computer Engineering at the University of Houston in Texas.

Independent of its collaboration with the University of Houston, the Company has ongoing collaborations with other leading edge research institutes in the field, including a separate, well-advanced research program with the Centre for Neuroprosthetics at the EPFL in Lausanne, Switzerland that also explores the use of mind control of robots.

The Auckland development team has also delivered two important product enhancements during the period. The first is a software upgrade that provides physiotherapists with a set of repeatable exercises that they can offer to their patients by putting the REX into "RAPPER" mode. This upgrade is in a phased global roll-out and the early customer feedback indicates that it will materially assist sales efforts. The second product enhancement is a reporting package that allows physiotherapists and patients to monitor their REX exercise performance in each session and over time.

Manufacturing Update

The move to new manufacturing facilities in Albany, just outside Auckland, in the second half of 2014 presented an opportunity for the Company not only to expand its manufacturing capacity but also to revalidate its production and quality management systems and, where appropriate, to introduce new, more rigorous procedures and controls to meet the challenges of manufacturing a highly complex medical device to the demanding standards required by national regulatory authorities around the world.

The success of the New Zealand manufacturing team in achieving this objective was recognised in October 2015 by the formal certification of the new facility to ISO 13485:2003 and ISO 9001:2008, confirming the compliance of Rex Bionics' quality management systems with the international regulatory requirements for medical devices. It gives us confidence that our manufacturing operations are well placed to meet the anticipated growth in product demand.

New Board Appointment

On 11 January 2016 we announced the appointment of Joseph A. Cucolo as a Non-Executive Director of the Company. Joe, who lives in upstate New York becomes the Company's first US-based Director, and his appointment provides further evidence of our intention to increase our commercial focus on the US market. He has had a long and successful career with Zimmer Holdings Inc., one of the largest medical device companies in the world, most recently as President of Americas with responsibility for a $2.5 billion business covering the United States, Canada and Latin America.

We would like to take this opportunity to welcome Joe to the Board. We look forward to working with him and to benefitting from his exceptional sales & marketing experience and extensive contact network within the US clinical community.

As announced in our Company update in September 2015, Richard Little, the co-founder of Rex Bionics and its Chief Technology Officer, has indicated his intention to resign from his position in order to develop a new business in a non-competitive field. Richard will continue to work with Rex Bionics on a consultancy basis, in order that his knowledge and experience remains available to the Company. Duncan Clement, Rex Bionics' Director of Engineering, who first worked with Rex in 2008, will continue to lead the Company's R&D group, as he has done since his appointment to the role 2015. At the date of this report, Richard remains with the Company on a full-time basis.

Financial update

Consolidated Financial Statements

The Consolidated Financial Statements comprise the results of Rex Bionics Plc for the year ended 31 March 2016, together with those of its operating subsidiaries Rex Bionics Ltd (New Zealand), Rex Bionics Inc. (USA) and Rex Bionics Pty Ltd (Australia) all of which are wholly-owned. As a result of the change in the Company's accounting reference date in the previous financial period, prior period comparatives where shown are for the sixteen-month period ended 31 March 2015. The prior period figures include the results of the New Zealand, the US and Australia from the later of the date of the Company's IPO, May 2014, and the date on which the subsidiary commenced operations.

Consolidated Statement of Comprehensive Income

The net loss for the year ended 31 March 2016 amounted to £4.87 million (net loss, sixteen months ended 31 March 2015: £5.30 million). The prior period figure included non-recurring transaction costs of £0.64 million relating to the acquisition costs of Rex Bionics Ltd and the Company's IPO on AIM.

Current year revenues were £0.45 million, representing the first product sales since the Company's IPO in May 2014. The prior period comparative figure of £0.18 million related to sales & marketing and other support services provided by the Company to Rex Bionics Ltd prior to its acquisition.

The gross margin of £0.08 million, 17% of sales revenues, reflects a combination of low average selling prices due in particular to promotional pricing for demonstration devices supplied to new distributors, and to high unit costs in the start-up phase of commercial production.

Other income of £0.17 million (sixteen months ended 31 March 2015: £0.06 million) relates entirely to receipts under a New Zealand Government research & development grant awarded to Rex Bionics Ltd in July 2014.

Administrative expenses for the period of £5.62 million (sixteen months ended 31 March 2015: £5.65m) included research & development expenditure of £0.65 million (sixteen months ended 31 March 2015: £0.51 million), relating primarily to design improvements and additional features on the existing products, including the development of Rex-Link software to enable the operation of REX by thought control or remote control, in addition to improved diagnostics capabilities.

Also included in administrative expenses was amortisation of £1.12 million (sixteen months ended 31 March 2015: £0.64 million) on the fair value of intellectual property intangible assets acquired as part of the acquisition of Rex Bionics Ltd. The current period increase reflects a change in accounting estimate to reduce the period over which these assets are amortised from fifteen years to ten years

The taxation credit of £0.32 million (sixteen months ended 31 March 2015: 0.17 million) relates to a reduction in the deferred tax liability on intellectual property assets of Rex Bionics Ltd capitalised following its acquisition by the Company as a result of a fall in the net book value of those assets since the acquisition date due to amortisation.

Consolidated Statement of Financial Position and Cash Flows

The net assets of the Group at 31 March 2016 were £12.32 million (31 March 2015: £15.65 million). The major elements of the decrease in net assets during the year were:

· Net proceeds of shares issues £1.90 million;

· Net loss £(4.87) million;

· Effect of foreign exchange rate changes £(0.25) million

Net funds

Available cash reserves at 31 March 2016 of £1.86 million (31 March 2015: £4.37 million) comprised cash and short term deposits with maturities of less than three months, primarily denominated in Pounds Sterling and New Zealand Dollars. The Group had no bank borrowings at 31 March 2016 (31 March 2015: £nil).

The major elements of the decrease of £2.51 million in net funds during the period were the net operating outflows before changes in working capital of £3.88 million and capital expenditure of £0.50 million, offset by net proceeds of financing activities of £1.9 million, a decrease in working capital of £0.34 million, and an increase in restricted cash of £0.17 million.

Strategic update and outlook

The Board has recently completed a thorough strategic review on commercialisation progress and capital availability and concluded that, while it has taken longer than expected to achieve first commercial revenues, the market opportunity remains significant; the RAPPER II data shows that the REX product is safe and effective and there are many wheelchair users for whom REX is the only viable option for the achievement of an improvement in health and fitness for work and for recreation. The Board has therefore concluded that the Company should adopt a strategic positioning that more explicitly promotes REX's unique potential for patients with the most severe neurological injuries (typically people with quadriplegia and people who have experienced a stroke that has proved resistant to rehabilitation).

The Board further concluded that, notwithstanding the equity fundraising that was successfully concluded on 10 August 2016, the capital required by the Company appears unlikely to be readily available from new public market portfolio investors at this time and therefore it is appropriate to evaluate alternative opportunities with a view to maximising value for the shareholders and to build on the successes to date. Accordingly, the Company has begun to evaluate potential future strategic options, including seeking alternative sources of funding, strategic partnerships or other transactions. The participation by Maxhealth, an associate of our Chinese distributor, in the August 2016 fundraising is a good example of this new approach.

At the current burn rate the net proceeds of the fundraising will extend the Company's cash runway into the second quarter of 2017. The new funds will be used to maintain commercial momentum during the strategic re-positioning and review of further funding opportunities. Additional funding will continue to be required, but the Board remains confident that this will be forthcoming if the progress achieved over the last period in the development of the business can be maintained.

David Macfarlane Crispin Simon

Non-Executive Chairman Chief Executive

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

For the year ended 31 March 2016

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

As at 31 March 2016

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the year ended 31 March 2016

CONSOLIDATED STATEMENT OF CASH FLOWS

For the year ended 31 March 2016

1 General information

Rex Bionics Plc (the "Company") is a public limited company incorporated and domiciled in England and Wales (registration number 06425793). Its registered office address and principal place of business is 4th Floor, 1-3 Pemberton Row, London EC4A 3BG. The Company's Ordinary Shares are traded on the Alternative Investment Market of the London Stock Exchange Plc ("AIM") under the ticker "RXB".

The principal activities of the Group are the research & development, manufacture and commercialisation of advanced robotic devices designed to provide physiotherapy to and improve the physical and psychological well-being of people with major mobility impairment as a result of spinal cord injury or other neurological damage. 

2 Basis of preparation and statement of compliance with IFRSs

The Consolidated Financial Statements of the Group cover the year ended 31 March 2016. During the previous reporting period the Company changed its accounting reference date from 30 November 2014 to 31 March 2015. Prior year comparatives, where shown, cover the sixteen-month period ended 31 March 2015.

The Consolidated Financial Statements have been prepared and approved by the Directors in accordance with International Financial Reporting Standards ('IFRS') as adopted by the European Union ('EU'), IFRIC Interpretations and the Companies Act 2006 applicable to companies reporting under IFRS. They were approved and authorised for issue by the Board of Directors on 25 August 2016.

The Consolidated Financial Statements are presented in Thousand Pound Sterling (£'000). All amounts are rounded to the nearest thousand Pounds unless otherwise indicated.

The financial information in this results announcement does not constitute the Company's statutory accounts for the year ended 31 March 2016 or the Company's statutory accounts for the sixteen months ended 31 March 2015 as defined in section 434 of the Companies Act 2006, but is derived from those accounts.

The Annual Report and Accounts for the year to 31 March 2016 will be posted to shareholders on 1 September 2016 with notice of Annual General Meeting. The auditor has confirmed that it contains an unmodified opinion together with an emphasis of matter paragraph on going concern relating to the Company's requirement to raise further funds to continue to trade, and does not contain any statement under section 498 of the Companies Act 2006.

The Company's Annual Report and Accounts for the sixteen months ended 31 March 2015 was approved by the Board of Directors on 29 May 2015 and has been filed with the Registrar of Companies. The report of the auditor on the 2015 Annual Report and Accounts contained an unmodified opinion.

The Consolidated Financial Statements have been prepared on a going concern basis, notwithstanding the trading losses being carried forward and the expectation that the Group and Company will continue to make trading losses for some time to come.

The Group and Company are currently consuming cash resources, and will continue to do so until sales revenues are sufficiently high to generate net cash inflows. Until the Group and Company begin to generate positive net cash flows, they remain dependent upon securing additional funding, primarily through the injection of capital from share issues. During the current year the Group and Company have met their day to day financing requirements through the cash reserves brought forward from the previous period and the proceeds of an issue of equity share capital by the Company in June 2015 that raised £2.12 million before expenses.

At 31 March 2016 the Group had available cash reserves of £1.86 million. On 10 August 2016 the Company completed an equity fundraising raising £2.3 million before expenses via a subscription by certain new and existing shareholders, with the potential to raise up to a further £2.3 million before expenses on or before 30 June 2017 to the extent that warrants attaching to the shares issued in the subscription are exercised. The Directors anticipate obtaining further funding from existing shareholders in the current financial year, including from the exercise of the warrants, and will also seek funding from new investors. They have a reasonable expectation that additional funding can be raised, although there can be no certainty that additional funds can be raised on acceptable terms or at all. This represents the existence of a material uncertainty which may cast significant doubt about the Group and Company's ability to continue as a going concern and, therefore, that the Group and Company may be unable to realise their assets and discharge their liabilities in the normal course of business.

After taking into account current cash resources, their expectation of being able to raise further funding during the year to 31 March 2017, their financial forecasts for the Group and Company and measures that can be taken to reduce expenditure in the absence of additional funding so as to ensure that the Group and Company will have adequate resources to continue in operational existence for the foreseeable future (being a period of at least twelve months from the date of this report), and after making due and careful enquiries and considering all uncertainties, the Directors believe that it is reasonable to continue to adopt the going concern basis in preparing the annual report and financial statements. The financial statements do not include any adjustments that would result from the basis of preparation being inappropriate.

3 Loss from operations

4 Share capital and share premium

At 31 March 2016 the share capital of Rex Bionics Plc consisted of fully paid Ordinary Shares with a nominal (par) value of £0.10p per share and Deferred Shares with a nominal value of £0.90p per share. The Deferred Shares were created on 30 June 2015 as a result of a share restructuring in which each £1 Ordinary Share in issue at that date was sub-divided and re-denominated into one £0.10p Ordinary Share and one £0.90p Deferred Share. All Ordinary Shares rank pari passu in respect of the receipt of dividends, the repayment of capital and voting rights at Shareholders' meetings. The Deferred Shares have no dividend or voting rights and rank behind the Ordinary Shares in any repayment of capital.

5 Loss per share

Both the basic and diluted earnings per share have been calculated using the loss attributable to shareholders of the Parent Company as the numerator, ie no adjustments to loss were necessary in 2015 or 2016. At 31 March 2016, there were 1,340,599 options and 142,014 warrants outstanding (31 March 2015: 1,024,029 options and 142,014 warrants outstanding).

6 Events after the reporting period

On 10 August 2016 the Company completed a fundraising of £2.3 million before expenses (£2.1 million after expenses) from a subscription by new and existing shareholders for ordinary shares. Subscribers in the fundraising also received warrants to subscribe for ordinary shares on the basis of one warrant for each share subscribed. The warrants are exercisable on or before 30 June 2017.