Half yearly results

For Immediate Release 21 March 2016

Plant Impact plc

("Plant Impact" or the "Company" and,

together with its subsidiaries, the "Group")

Half yearly results for the six months ended 31 January 2016

Strong growth and opportunities ahead

Plant Impact plc (AIM: PIM) leads R&D in crop enhancement technology to create products that growers can rely on to increase the yield and quality of their crops. Today the Group announces its results for the six months ended 31 January 2016.

Financials: six months of growth plus a strong balance sheet

· Revenue £4.2m (2015: £2.5m)

· Profit after tax £0.4m (2015: £0.2m)

· Cash balance £8.6m (2015: £0.7m)

· Basic EPS 0.55p (2015: 0.32p)

Operational highlights

· Innovative promotional campaign in Brazil drove expansion of Veritas®

· Positive trial results in other major soy growing regions

· North America operations established and experienced new Commercial and Marketing Director, USA appointed

· First commercial shipments of Banzai™ made to Arysta LifeScience in West Africa

· Increased investment in R&D and progress with pipeline soy and wheat products on track

David Jones, Chairman of Plant Impact, commented: "Our determination to drive sales in Brazil whilst broadening the products and geographies in our soy range has shown results in the first half of the year. Furthermore, our promise to open a new market with large potential that is outside of soy in the Americas and with a different strategic partner, took shape with our first shipments of our cocoa product, Banzai™, to Arysta LifeScience in West Africa. We expect a busy and exciting time through the remainder of the year."

Note: reminder of timetable for future financial reporting and Investor Open Day

As stated in the Q1 trading update, the Group intends to simplify its financial reporting by issuing announcements of half yearly and preliminary results in March and October respectively, together with two trading updates in June and December. Release dates for future financial reports are listed on the Investor section of the Group's website www.plantimpact.com

The Group will host an Open Day for current and prospective investors at its research facilities and head office at the Rothamsted Centre for Research and Enterprise, West Common, Harpenden, Hertfordshire, AL5 2JQ. The event will be held on 1 July 2016, from 10:00am to 1:00pm. Attendees are requested to pre-register by emailing the Company at [email protected].

For more information please contact:

Chairman's statement

The Board is pleased to report continued progress in the six months ended 31 January 2016.

Sales in Brazil of Veritas®, the Group's flagship soy yield improvement product, achieved our target for the period and accounted for the majority of the revenue of the Group in the period. For the 2015/16 growing season, the Group made a significant investment to support Veritas®, expanding its team of agronomists in Brazil's Cerrado and southern growing regions. In addition, a promotional marketing campaign took a roadshow to 26 locations in Brazil, reaching over 2,000 soy growers with technical training and product information. This effort, which included many innovative communication and grower incentive features, is expected to be effective in converting sales into grower usage of Veritas®. The Group continues to monitor product usage and stock figures in the market and will have a clearer outlook for the subsequent season by the end of June.

The first shipment to West Africa of Banzai™, Plant Impact's cocoa crop enhancement product, was made in the second quarter. Recently, additional, unforecast volumes have been confirmed by Arysta LifeScience to increase in-market stock ahead of their upcoming campaign. Banzai™ is a new initiative for the Group and a valuable diversification from soy in the Americas. In performance terms, Banzai™ can significantly increase yields for small holder cocoa farms in West Africa, the source of more than 70% of the world's cocoa production. A detailed campaign to reach farmers in this market is being prepared with our partner, Arysta Life Science.

In Northern Europe, the season has not yet started, however the Group is in discussions with distributors to secure purchase orders for the season, and the results of those discussions will be evident in the full year results. The Group's Middle East business is expected to be weaker in 2016, as political turmoil in most markets has reduced prices for grower produce, significantly lowering expectations of grower consumption of technical inputs.

Research and development work continues satisfactorily towards bringing new products for soy crop enhancement to market and developing our first product in wheat. We expect to announce new product launches in North and South America over the next 1-2 years.

Financial performance

Revenue in the period was £4.2m (2015: £2.5m). The increase in revenue reflects the third commercial season of shipments of Veritas® to Brazil plus the first shipments of Banzai™ to West Africa. There were minimal off-season shipments to Northern Hemisphere markets and less than the prior period due to the continuing political issues in Egypt.

Gross profit for the six month period was £3.3m (2015: £1.9m). Gross margin was 79% (2015: 77%) as a result of a better product mix. Prices and costs continue to remain stable.

Operating profit was £213k (2015: £81k). Profit for the period attributable to equity shareholders increased to £449k (2015: £205k). Operating expenses increased to £3.1m (2015: £1.8m) due to the planned increases in headcount. New employees were recruited in all areas of the business over the past 12 months, and in several new geographies including North Carolina and Argentina.

Research and development expenditure increased to £1.1m (2015: £0.9m). £0.2m (2015: £0.3m) was capitalised. This trend will continue in the next six months as field trial programmes continue in Brazil, Argentina, Paraguay, USA and West Africa.

Share-based payment charges increased to £356k (2015 £38k) as a result of the award of Value Creation Plan options approved at the November 2014 AGM and the significant increase in new starters who receive options upon joining.

Favourable exchange rates generated a foreign exchange gain, and a tax credit arose from an expected increase in Research and Development tax credit, reflecting continued investment.

The cash balance at 31 January was £8.6m (2015: £0.7m). The increase over the comparative period was a result of a placing in February 2015 which generated £5.95m in net proceeds. In March 2015 the Group received £1.95m from Bayer Crop Science by way of a licence fee. The Group expects to utilise cash over the next six months to execute its Research and Development programme and in continuing investment in people as the Group expands geographically.

Outlook

Plant Impact's strategy of broadening the products and geographies for our soybean range in Latin America has advanced well in the first half, and the first products for West African cocoa offer exciting opportunities. The Directors look forward with confidence to the expansion of the Group's crop enhancement portfolio into new products, crops and geographies.

David Jones

18 March 2016

Plant Impact plc

Unaudited Group Statement of Comprehensive Income

For the six months ended 31 January 2016

All results are from continuing activities. 

The notes are an integral part of these unaudited consolidated six month results.

Plant Impact plc

Unaudited group statement of financial position

At 31 January 2016

The notes are an integral part of these condensed unaudited consolidated six month results.

Plant Impact plc

Unaudited group statement of changes in equity

For the six months ended 31 January 2016

Plant Impact plc

Unaudited consolidated statement of cash flows

For the six months ended 31 January 2016

Notes to the unaudited consolidated interim financial statements

 1. Nature of operations and general information

The Group's principal activities include the research, development, manufacturing and sale of crop nutrients and crop pest control products and technologies.

Plant Impact plc is the Group's ultimate parent company. It is incorporated and domiciled in the United Kingdom. The address of Plant Impact's registered office, which is also its principal place of business, is Rothamsted, West Common, Harpenden, Hertfordshire, AL5 2JQ, United Kingdom. Plant Impact's shares are quoted on AIM, a market operated by London Stock Exchange plc.

Plant Impact's unaudited consolidated six month results are presented in Pounds Sterling (£), which is also the functional currency of the parent company. All values are rounded to the nearest thousand ('000) except where otherwise indicated. 

These unaudited consolidated half year results have been approved for issue by the Board of Directors on 18 March 2016.

The financial information set out in this unaudited consolidated six month results statement does not constitute statutory accounts as defined in Section 434 of the Companies Act 2006. The Group's statutory financial statements for the year ended 31 July 2015, prepared under IFRS, have been filed with the Registrar of Companies. The auditor's report on those financial statements was unqualified and did not contain any statement under Section 237(2) of the Companies Act 2006.

2. Basis of preparation

These unaudited consolidated results are for the six months ended 31 January 2016. They have not been prepared in accordance with IAS 34, Interim Financial Reporting. They do not include all of the information required for full annual financial statements, and should be read in conjunction with the consolidated financial statements of the Group for the year ended 31 July 2015.

The Group's existing financial resources together with contractual arrangements with certain economic partners in different geographical areas provides a sound platform for launching the Group's products and generating future sales and revenues. As a consequence, the Directors believe that the Group is well placed to manage its business risks successfully despite the current uncertain economic outlook.

The Group's forecasts and projections, which have been prepared to 31 July 2017, including sensitivity analysis, and taking account of reasonably possible changes in performance show that the Group should be able to operate within the level of its current cash resources.

After making enquiries, the Directors have a reasonable expectation that the Company and the Group have adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the unaudited consolidated six month results.

These unaudited consolidated interim financial statements have been prepared in accordance with the accounting policies expected to be adopted in the next annual financial statements for the year to 31 July 2016.

The accounting policies have been applied consistently throughout the Group for the purposes of preparation of these unaudited consolidated six month results.

3. Profit per ordinary share

The calculations of profit per ordinary share are based on the following profits and weighted average number of shares in issue during the period: