15th Jun 2009 07:00
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Press Release |
15 June 2009 |
Plant Impact plc
("Plant Impact", the "Group" or the "Company")
Preliminary Results for the year ended 31 March 2009
Plant Impact plc (AIM:PIM), a global developer of plant stress management technologies, today announces its preliminary results for the year ended 31 March 2009.
Corporate Highlights
Letter of intent and loan agreement signed with Arysta LifeScience Corporation;
First sales in eight new territories (UK, Netherlands, Portugal, Kenya, United Arab Emirates, France, Poland and Nigeria);
First sales of Cocoa Stress Tolerance (CST) product;
First sales of crop nutrient products on ornamentals; and
Board appointment of two industry experienced Non-Executive Directors.
Research & Development Highlights
BugOil® Chemicals Regulation Directorate (CRD) dossier submission; and
Patent approval ongoing.
Financial Highlights
Increase in turnover to £830k (2008: £285k);
Improved gross profit margins 47.6% (2008: 35.8%);
Increase in research and development and distribution spend to £2,029k (2008: £1,257k);
Loss before tax £2,475k (2008: £1,847k); and
Cash £756k (2008: £2,980k).
Post year end
Licence agreement for BugOil® signed with Arysta LifeScience Corporation.
Martin Robinson, Chairman of Plant Impact plc, commented:
"Plant Impact has focused efforts on commercialising its unique technologies and products. We are very pleased with the results of these efforts, from what is still a small team. During the year, we have seen growth in sales from established territories, expansion into new territories and the commencement of negotiations for the licensing of BugOil®. The conclusion of these negotiations was the signing of a license agreement with Arysta LifeSciences Corporation on the 29 May 2009. This is a significant commercial and financial event for the Group.
Plant Impact will continue to focus on commercialisation of its products and technologies. Planned field trials will continue to provide efficacy data on a wider crop and geographical spread. The results we are witnessing enhance marketable yield for the grower, improve shelf life, reduce physiological diseases and are environmentally friendly. The Group's products and technologies continue to attract considerable interest from potential industry partners, food groups and Government".
For further information, please contact:
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Plant Impact plc |
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Peter Blezard, Chief Executive Officer |
Tel: + 44 (0) 1772 645 164 |
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Michael Panteli, Chief Financial Officer |
Tel: + 44 (0) 1772 645 165 |
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Blomfield Corporate Finance Limited Nominated Adviser |
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Emily Morgan / Nick Harriss |
Tel: +44 (0) 207 489 4500 |
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Religare Hichens, Harrison plc Broker Daniel Briggs |
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Media enquiries: |
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De Facto Communications |
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Anna Dunphy / Tristan Jervis |
Tel: +44 (0) 207 861 3838 |
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Chairman's Statement
I am pleased to present Plant Impact's results for the year ended 31 March 2009. The Group has made excellent progress over the year. During the twelve months under review, the Group has taken significant steps in the commercial validation of both BugOil® and its crop nutrient products. On 19 February 2009, we announced that the Group had entered into a loan agreement and exclusive detailed discussions with a global top 10, by revenue, agrochemical company for the licensing of BugOil®. These discussions have progressed well and, on 29 May 2009, the licence agreement was signed with Arysta LifeScience Corporation ("ALS"). Sales of the crop nutrient products have also improved. We have achieved repeat sales in key territories like the USA and have entered new territories. During August 2008, the Group submitted the European registration dossier for BugOil® to the Chemicals Regulation Directorate (CRD), formerly the Pesticides Safety Directorate. The dossier for submission to the Environmental Protection Agency (EPA) in the USA is being finalised with submission anticipated during quarter 3 2009. The Group has also made a number of important changes to the structure of the Board.
Financial review
Turnover for the year was £829,616, compared to £284,853 for the year ended 31 March 2008. The increase in turnover has come from direct sales to growers, particularly in the UK and Europe, and sales via the Group's distributor in the USA. Sales and margins in the UK and Europe have improved due to the contribution of the Group's inventory policies. These policies provide prompt delivery of product to growers, which allows for improved sales pricing and therefore margin. Gross profit margins have improved from 35.8% for the year ended 31 March 2008 to 47.6% for the current year.
The operating loss for the year was £2,546,326, compared to £1,967,344 for the year ended 31 March 2008, reflecting the increase in research and development and the expansion of the sales team. Interest and research and development tax credit receivable reduced the loss for the year attributable to equity shareholders to £2,255,075, compared with £1,664,549 for the year ended 31 March 2008. Cash balances at 31 March 2009 amounted to £756,012, compared with £2,979,926 for the year ended 31 March 2008.
Product development
During the year, the Group has made excellent progress expanding its field trial programmes, product registrations and intellectual property protection.
Field trials
The field trial programmes continue to demonstrate efficacy of the Plant Impact technologies and products. The trial results prove that on high value crops, the Group's products can increase marketable yield, improve shelf life, reduce physiological diseases, produce healthier crops and lower inputs. The latter is of significant environmental benefit.
Trial programmes have continued to support territories established in previous years and have expanded into new geographical areas. During the year ended 31 March 2008, the Group completed 80 field trials in 10 countries, this compares to 200 field trials in 32 countries during the year ended 31 March 2009. Trials for the coming year have already commenced, with a total of 200 planned.
Product registrations
The Group's dossier for the European registration of BugOil®, was submitted to the CRD in August 2008. This is a key milestone for the Group and the commercial development of BugOil®.
Submission of the dossier is the requisite first step in a product registration process that would enable the Group to sell and distribute BugOil® in Europe. The dossier consists of a set of documents with comprehensive data on BugOil®, which would lead to Annex I inclusion under EU directives. Annex I inclusion allows the active ingredients found in BugOil® to be sold within the EU for use as a pest control agent. Subject to product registration, Plant Impact expects to commence its first sales of BugOil® in Europe in 2010. Plant Impact holds all intellectual property rights to BugOil®.
The CRD criteria for registration are some of the most stringent in the world. In addition to opening up the European market for BugOil®, the information collected as part of the registration process and completion of the registration by CRD will assist the Group in gaining registration outside the EU, in territories including the USA, Latin America, Africa and the Middle and Far East.
The Group has continued to work on the dossier for submission to the EPA for regulatory approval in the USA. The timing for completion of the dossier and submission is estimated to be during quarter 3 2009 with approval towards the end of quarter 3 2010.
Intellectual property protection
The Group continues to improve the patent portfolio with granted patents for Speedo™ in the UK and for CaT technology in Morocco.
Commercial developmentPlant Impact commercial development during the year has demonstrated significant improvement in crop nutrient sales, repeat sales, greater geographical spread of sales, improved margins, increased distribution agreements and advanced negotiations for worldwide licensing of BugOil®.
Crop nutrient sales
Sales during the year at £829,616 increased by £544,763 over 2008. Volume supplied to customers increased from 196,600 litres in 2008 to 397,491 litres in 2009. The best performing product was Inca, with sales in 2008 of £100,198 and in 2009 of £354,048.
Plant Impact has achieved commercial sales in new countries and has developed repeat sales in countries entered in previous years. Commercial growth in the USA and Spain were of particular note, with Spain growing from £8,882 in 2008 to £129,833 in 2009 and the USA from £57,245 in 2008 to £165,300 in 2009.
Margins
Margins on the sale of crop nutrient have improved from 35.8% in 2008 to 47.6% in 2009. This is the result of improved selling prices on proven products, inventory available for immediate delivery in the UK, Netherlands and Spain and the impact of the larger Plant Impact sales team.
Distribution agreements
Plant Impact continues to develop distribution routes in target countries with new distribution agreements being signed during the year in the USA, Europe, Morocco and Tanzania.
In April 2008, Plant Impact entered into a five-year agreement with Miller Chemical & Fertilizer Corporation, of Pennsylvania, USA ("Miller"), to market and distribute three of Plant Impact's proprietary products, primarily in the USA. Miller is a global manufacturer and distributor of specialty agricultural products and fertilisers. The agreement has resulted in sales during the year of £195,735.
This is Plant Impact's first marketing and distribution agreement in the USA and as such represents another significant milestone, increasing the global reach of the Group's technologies and products. Under the agreement, Miller will market, distribute and provide branding support by displaying the Plant Impact logo on all products sold. In addition, this agreement allows for sales in other territories under the "Miller" brand name.
This agreement centres around three of Plant Impact's products:
Inca - used for improved fruit quality, longer shelf life and resistance to climate stress using Plant Impact's proprietary CaT technology.
Cocoa Stress Tolerance "CST" - used for increased marketable yield in cocoa (chocolate) production using the proprietary Alethea technology.
Balance - used for accelerated harvest and improved fruit quality using the proprietary Speedo technology.
Miller has a significant US network with access to over 400 distributors nationwide. It also has international partners outside the US in countries including Canada, several South and Central American countries, South Africa and Australia. In addition to agricultural crops, Miller also supplies growers of commodity row crops such as cotton, corn grains and soybeans. Miller boasts a strong sales and technical team including 26 full-time sales representatives in the US.
In addition to the above agreement, the Group has entered into distribution agreements with Miller for Europe and Agrin Moroc for Morocco, both agreements are for crop nutrient products.
Licensing
Having signed a letter of intent with ALS for the global licensing of BugOil® on 18 February 2009, the Group has completed negotiations and the licensing agreement was signed on 29 May 2009. This agreement has the potential to fully commercialise BugOil®, by providing the regulatory, manufacturing, marketing and distribution strength of a major agrichemical company.
ALS has carried out evaluation trials on BugOil® to confirm efficacy and market potential. Under the terms of the licensing agreement, ALS has an exclusive licence to the patents, patent applications and know-how and other trade secrets of BugOil® and to manufacture and market BugOil® globally in all market segments except home and garden and animal health. The licence is for a term of 20 years (or if sooner, the expiration of the relevant patents) and ALS will make payments to Plant Impact in accordance with agreed milestones, both regulatory and sales, as well as royalties upon sales. The first milestones are expected during 2009 and first royalties are expected during 2010.
Plant Impact and ALS are also in discussions regarding access to distribution rights for certain crop nutrient technologies and products owned by the Group.
Under the terms of the loan agreement ALS has agreed to loan up to £750,000 to Plant Impact which is to be drawn down over a period of 180 days from 18 February 2009. Interest accrues on the loan at a variable rate of LIBOR plus 3% per annum. The outstanding principal balance, plus all accrued interest, is repayable in full over a three year period. ALS may elect to offset up to 50% of any royalty payments due under the licensing agreement against interest and principal outstanding under the loan. The loan is secured against the intellectual property of Plant Impact and at the year-end, £250,000 had been drawn down under this agreement.
Board Changes
Two Non-Executive Directors, David McNeilly and Dr. Edward Sharkey were appointed on 1 October 2008.
David McNeilly, 65, has over 42 years' experience in life science related businesses, including 32 years with the DuPont Co. He works at the interface of technology and business development, especially in assessing how to add and capture value and in developing growth strategies. He has proven skills in leadership, strategic planning, marketing, sales and small business development. Although originally a botany graduate, the focus of David's work at DuPont was mainly in the fields of agribusiness marketing, licensing and especially biotechnology, which he has concentrated on for the last 20 years. He recently held non-executive board positions in Alaska Diagnostics Ltd (food diagnostics), Avidis S.A. (therapeutics) and Prokyma Ltd (particle separation diagnostics).
Having gained his PhD in Chemistry from the University of Edinburgh, Edward Sharkey, 61, joined AH Marks, where he spent the majority of his career in the agro-chemical industry. He progressed to the main board where as an executive director he was instrumental in the building of a performance chemicals business with a team of 12 scientists. Most recently he founded Ambechem Ltd, a management consultancy business operating in the agro-chemical sector. Presently Edward chairs a number of global task forces as well as several international businesses, and has a wealth of experience in the regulatory and registration process. He is also a director of Ambechem Ltd.
At the end of August 2008, Bill Thompson, who has been a Non-Executive Director of the Company and one of its subsidiaries since 2004, took on the role of Chief Operating Officer. He brings considerable operational experience to the role, having spent 17 years with Dow Chemicals, latterly as Global Business Leader for insecticides and fungicides, where he contributed to an increase in sales from $65 million to $130 million over four years.
Mark Wyatt resigned as a Non-Executive Director on 31 August 2008 and Gordon Harman retired as a Non-Executive Director on 31 January 2009. I wish to record my thanks to both Mark and Gordon for their guidance and stewardship during the formative years of the Group. Mark has been associated with the Group since the RisingStars Growth Fund made its first investment in the Group and joined the Board when the Company floated on AIM in October 2006. Gordon was appointed as part-time Finance Director of the Group in 2005. In addition to managing the Group's finances, his wealth of experience in growing companies provided a valuable contribution to the development of the Group. Gordon stepped down as Finance Director to a Non-Executive role when Mike Panteli joined the Group in May 2007.
Dividends
The Directors currently intend to devote the Group's cash resources to its operations and therefore do not anticipate paying dividends in the near future. They will reconsider the Company's dividend policy as and when the Company is in a position to pay dividends. The declaration and payment by the Company of any dividends will depend on the results of the Company's operations, its financial condition, cash requirements, future prospects, profits available for distribution and other factors deemed to be relevant at the time.
Outlook
The Directors are very pleased with the progress made during the year. With the growth in sales both from established and new territories and the licence agreement, the Group is gaining momentum towards commercial and financial viability. This has been achieved by the superb efforts from what is still a very small, but dedicated, management team, who have developed and are promoting a range of compounds that the Directors believe have the potential to be world beating products.
We look forward to the coming year, when we hope to make further announcements on the commercial expansion of the Group and the success of our field trial programmes.
Martin RobinsonChairman15 June 2009
Business Review
Plant Impact continues to develop technologies and products which increase marketable yield, improve shelf life, lower inputs and are more environmentally friendly than current standard practice.
World drivers*
Food security is of growing concern both for national governments and the world. This issue brings pressure on agricultural production that needs to produce more with ever decreasing resources and with reduced environmental impact. There is no single solution to the food crisis; however, technological innovation in agricultural practice and products will go a long way to help.
The drivers which existed last year continue to dominate food security issues. The global population is expected to rise from current levels of nearly 7 billion to 9 billion by 2050, most of this growth will occur in developing countries. It is estimated that the impact on agricultural production is a doubling in current output. Increasing affluence in emerging markets such as India and China bring increasing demand for meat and dairy products diverting arable crops from human food to animal feed. By 2050, meat consumption is expected to double. All this pressure on food supplies is exacerbated by the limited and reducing natural resources to grow food. Farmland is limited and by 2050 the available farmland per capita will decline by an estimated 30%. Increasing urbanisation reduces farmland, by 2050 approximately 3 billion more people are expected to be living in cities. Expanding urban living reduces land availability for crop production. Soil erosion further reduces land available for food production. Water availability has a significant impact on crop yield. Around 70% of global water usage is in agriculture. As pressure mounts to increase food production, so will pressure on the world's water supply, which is limited and unevenly distributed.
The agrochemical industry needs to respond to these challenges of:
* Sources: UN Food and Agricultural Organisation (FAO), UN World Food Programme, United States
Department of Agriculture (USDA).
Technologies and Products
Plant Impact has developed six key technologies designed to increase marketable yield, improve shelf life, lower inputs and be more environmentally friendly than current standard practice. These technologies can be divided into two distinct groups:
crop nutrients - CaT, PINT™, Alethea®, and Speedo™; and
pest control - BugOil® and nematicide.
Of these technologies, Plant Impact has developed eleven products which are:
PiNT Calcium, PiNT Potassium and PiNT Magnesium from PiNT technology;
Cocoa Stress Tolerance (CST) and Scope from Alethea;
Balance and Saxon from Speedo technology; and
Bionic from BugOil technology.
Alethea (with the exception of CST and Scope) and nematicide are at the research and development stage.
Crop Nutrients
Calcium Technology - CaT
A Calcium transport and delivery technology designed to work at a cellular level.
CaT uses patent applied chemistry to improve calcium absorption by plant tissues with a low ability to take up and retain calcium. Calcium is used by plants for cell integrity, cell wall strength and cell division. However, calcium uptake and movement within plants is erratic and therefore some parts of plants struggle to absorb and retain calcium. This leaves them weak and prone to infection and quality problems. Often these areas are the part of the plant that growers wish to harvest. Many fruit and vegetable crops suffer from 'physiological disorders' associated with low calcium levels.
This technology has a patent application, and has yielded several commercial products, the main benefits of which are:
increased shelf-life and quality;
improved growth during high and low temperatures and frosts;
holding and setting more flowers and fruit; and
lower input levels compared to standard calcium applications.
PiNT™
Plant Impact Nitrogen Technology (PiNT™) controls the uptake of nitrogen by a plant.
PiNT™ Calcium (PiNT Ca) gives the plant a better root system, improving reproductive growth (which is harvested) and reduced vegetative growth (which is discarded). This is also valuable in ornamentals and turf crops, where growers do not want 'leggy' growth for cosmetic reasons.
PiNT™ Potassium and Magnesium (PiNT K) improve quality and colour of product and shorten the time to harvest. With some crops having shorter maturation periods there is also the possibility for additional harvests.
Speedo™
Speedo™ is a natural plant maturity promoter. Field trials have indicated an increase in sugar content, colour, and reproductive maturity in a range of fruit and vegetable crops.
Alethea®
This technology uses a new molecule that has been designed to combat the effects of abiotic stress. Abiotic stress is caused by extremes of temperature, water, drought, salinity, heavy metals, herbicide and light intensity. Abiotic stress is a major problem in agriculture, limiting the ability of crops to achieve optimum yield and quality. Abiotic stress contributes to disease, since stressed crops suffer from higher levels of many diseases.
The Alethea® chemistry promotes the maintenance of strong, healthy cell walls in conditions of stress and reduced water availability, whilst this allows the cells to neutralise harmful ammonia and oxidative toxins that accumulate in plants at times of stress.
Pest Control
BugOil®
BugOil® is a botanical pest control technology that controls sap-feeding pests including mites, whitefly, cotton aphid and thrips. The control provided by BugOil® is to the level of the current best performing synthetic pesticides (verified through independent trials). It is safe on most beneficial insects (bees, earthworms, ladybirds) and is based on food grade materials.
BugOil® is safe to non-targets and provides excellent control of pests.
Nematicide
A chemistry based on a synergy between essential oils, that controls nematodes (Potato Cyst Nematode).
Further development of the Plant Impact nematicide technology is subject to a pending grant application.
Field Trial Programmes
During the year ended 31 March 2009, Plant Impact continued to expand its field trial programmes to increase crop coverage and geographical areas. The trials focus on high value fruit and vegetables, ornamentals and nuts.
The total number of field trials conducted during the year was in excess of 200 (2008: 80) covering 32 (2008: 10) countries. The majority of trials are conducted by distributors.
Crop Nutrients
The crop nutrient field trials are designed to prove yield improvement, shelf life extension, improved crop health, reduction in physiological disorders and commercial benefit to the grower. The Group is also planning trials to prove environmental benefits such as reduced inputs, reduced nitrate leaching, energy saving and reduced water requirements.
Field trials have been and are being conducted on the following crops:
Almonds, apples, artichoke, bananas, blueberries, cabbage, carrots, cherries, chillies, citrus, cocoa, courgettes, cucumber, grapes, lettuce, melons, olives, peaches, pears, peppers, pistachio, pomegranates, potatoes, strawberries and tomatoes.
Field trial results this year include:
Apples
Field trials carried out in the USA by Miller and in the UK by local distributors have demonstrated peel and flesh calcium increases of up to 2.25%, improvement in fruit calcium content of between 6.5 and 7.5 units in combination with plant growth retardant products. In addition, storage tests demonstrated improved fruit colour and firmness and reduced bitter pit and reduction in cost per acre to the grower from $88 to $82. The product used in these trials was Inca from CaT technology.
Bananas
The trial held in Morocco demonstrated improved fruit curving, increased brix and increased fruit weight. The product used in these trials was Inca.
Blueberries
Trials carried out in the Netherlands demonstrated improved ripening, improved brix from 9 to 11.8 and increased dry matter by 12%. The product used in these trials was Balance from Speedo™ technology.
Cherries
Field trials carried out in Chile by a local distributor have demonstrated improved performance against competitor products, improved fruit colour, nutrient elements in the fruit were statistically higher, improved fruit sugar content, improved fruit diameter, earlier harvest and increased grower return. The products used in these trials were Inca and Scope, the latter from Alethea technology.
Cocoa
Field trials carried out in Nigeria on cocoa plants have provided the following interim results, increased number of pods when measured against the grower standard treatment from 200 to 644 and increased seed size from 2cm to 3cm. Final results will be available toward the end of quarter 2 2009. The product used is Cocoa Stress Tolerance which is a combination of Alethea and PiNT technologies.
Cucumber
Field trials carried out in Greece with interim results demonstrating that flowering shoots were longer, faster growing and more advanced in development. The products used were PiNT Ca and PiNT K both from PiNT technology.
Lettuce
Field trials in the Netherlands show tighter larger lettuce heads, improved shelf life by 7 days, improved control of disease stress reducing entry points for fungi, increased yield by 15%, increased calcium levels by 15%, lettuce head weight increased by 3%, reduction in calcium input compared to grower standard from 54 units to 15 and improved calcium delivery by 3.6 times. The product used in these trials was Inca.
Peaches
Field trials conducted in Spain have shown increased brix, increased colour, increased dry weight, increased calcium levels in both peel and flesh, considerable decrease in deformed fruit, increased sugar content and improved storage condition after 25 days. The product used in these trials was Inca.
Strawberries
Field trials in the Netherlands and UK have shown increases in nutrients, reduced input against standard from 80 units to 15 units, 5.3 times more effective in increasing fruit calcium, reduced physiological disorders, improved brix levels and improved shelf life. The product used in these trials was Inca.
Tomatoes
Trials held in the USA, UK and Greece have shown increased calcium content by 12%, blossom end rot completely cleared, increased brix levels by 10%, significant improvement in root growth increased fruit size and improved fruit firmness. The products used being Inca, PiNT Ca and PiNT K.
BugOil®
BugOil® field trials undertaken to date have proven efficacy on target pests of at least equivalent efficacy to synthetic products. The planned field trials for 2010 will extend the crop and geographical coverage of target pests. This programme of trials will include UK, Spain, Italy, Netherlands, Turkey, Morocco, Mexico, Korea, Japan, USA, Colombia, Brazil and Chile a total of 130 trials. The target pest being mites, whitefly, thips, aphids and psylla on high value crops including ornamentals.
Distribution Agreements
Plant Impact continues to develop distribution routes in target countries with new distribution agreements being signed during the year in the USA, Europe, Morocco and Tanzania. This is fundamental to the Group's field trials programmes and sales activity.
Group Income Statement
For the year ended 31 March 2009
|
Note |
Year ended 31 March 2009 £ |
Year ended 31 March 2008 £ |
|
|
Revenue |
829,616 |
284,853 |
|
|
Cost of sales |
(434,562) |
(182,928) |
|
|
Gross profit |
395,054 |
101,925 |
|
|
Distribution costs |
(553,353) |
(310,901) |
|
|
Research and development costs |
(1,476,010) |
(945,627) |
|
|
General and administrative expenses |
(912,017) |
(812,741) |
|
|
Total expenses |
(2,941,380) |
(2,069,269) |
|
|
Operating loss |
(2,546,326) |
(1,967,344) |
|
|
Finance income |
72,553 |
120,343 |
|
|
Finance cost |
(1,293) |
- |
|
|
Finance income - net |
71,260 |
120,343 |
|
|
Loss before tax |
(2,475,066) |
(1,847,001) |
|
|
Income tax credit |
3 |
219,991 |
182,452 |
|
Loss for the year attributable to equity shareholders of the Company |
(2,255,075) |
(1,664,549) |
|
|
Loss per ordinary share attributable to equity shareholders of the Company during the year |
|||
|
Total and continuing: |
|||
|
Basic and diluted |
4 |
(0.09) |
(0.07) |
All revenue and costs originate from continuing activities.
Group Statement of Changes in Equity
For the year ended 31 March 2009
|
Share capital |
Share premium |
Other reserve |
Merger reserve |
Retained earnings |
Total equity |
|
|
£ |
£ |
£ |
£ |
£ |
£ |
|
|
At 1 April 2007 |
231,193 |
6,019,263 |
188,456 |
182,892 |
(3,134,858) |
3,486,946 |
|
Loss for the year and total recognised loss for the year |
- |
- |
- |
- |
(1,664,549) |
(1,664,549) |
|
Share based payments |
- |
- |
211,190 |
- |
- |
211,190 |
|
Proceeds from placing - 21 February 2008 |
31,915 |
1,468,085 |
- |
- |
- |
1,500,000 |
|
Share issue expenses |
- |
(75,000) |
- |
- |
- |
(75,000) |
|
Balance at 31 March 2008 |
263,108 |
7,412,348 |
399,646 |
182,892 |
(4,799,407) |
3,458,587 |
|
Loss for the year and total recognised loss for the year |
- |
- |
- |
- |
(2,255,075) |
(2,255,075) |
|
Share based payments |
- |
- |
88,032 |
- |
- |
88,032 |
|
Balance at 31 March 2009 |
263,108 |
7,412,348 |
487,678 |
182,892 |
(7,054,482) |
1,291,544 |
Total recognised income and expense recognised directly to equity amounts to £nil (2008: £nil).
Other reserve
The other reserve comprises of the fair value of share based payments granted in accordance with IFRS 2.
Merger reserve
The merger reserve arose on the acquisition of PI Bioscience Limited which was accounted for under UK GAAP. This business combination took place prior to 1 April 2006, the Group's date of transition to IFRS and as such the Group has elected not to apply IFRS 3 "Business Combinations".
Group Balance Sheet
As at 31 March 2009
|
2009 |
2008 |
||
|
Note |
£ |
£ |
|
|
ASSETS |
|||
|
Non-current assets |
|||
|
Intangible assets |
5 |
656,757 |
585,383 |
|
Property, plant and equipment |
27,603 |
29,470 |
|
|
684,360 |
614,853 |
||
|
Current assets |
|||
|
Inventories |
99,822 |
3,793 |
|
|
Trade and other receivables |
763,663 |
212,019 |
|
|
Corporation tax receivable |
217,735 |
176,594 |
|
|
Cash and cash equivalents |
756,012 |
2,979,926 |
|
|
1,837,232 |
3,372,332 |
||
|
Total assets |
2,521,592 |
3,987,185 |
|
|
LIABILITIES |
|||
|
Non-current liabilities |
|||
|
Borrowings |
(251,293) |
- |
|
|
(251,293) |
- |
||
|
Current liabilities |
|||
|
Trade and other payables |
(978,755) |
(528,598) |
|
|
(978,755) |
(528,598) |
||
|
Total liabilities |
(1,230,048) |
(528,598) |
|
|
Net assets |
1,291,544 |
3,458,587 |
|
|
EQUITY |
|||
|
Equity attributable to equity shareholders of the Company |
|||
|
Share capital |
263,108 |
263,108 |
|
|
Share premium |
7,412,348 |
7,412,348 |
|
|
Other reserve |
487,678 |
399,646 |
|
|
Merger reserve |
182,892 |
182,892 |
|
|
Retained earnings |
(7,054,482) |
(4,799,407) |
|
|
Total Equity |
1,291,544 |
3,458,587 |
Group Cash Flow StatementFor the year ended 31 March 2009
|
Year ended 31 March 2009 |
Year ended 31 March 2008 |
||
|
£ |
£ |
||
|
Cash flows from operating activities |
|||
|
Loss before tax |
(2,475,066) |
(1,847,001) |
|
|
Adjusted for: |
|||
|
Depreciation |
15,234 |
7,093 |
|
|
Share based payments |
88,032 |
211,190 |
|
|
Finance income |
(72,553) |
(120,343) |
|
|
Finance cost |
1,293 |
- |
|
|
Operating loss before working capital changes |
(2,443,060) |
(1,749,061) |
|
|
Increase in trade and other receivables |
(551,521) |
(84,198) |
|
|
Increase in inventories |
(96,029) |
(763) |
|
|
Increase in trade and other payables |
450,157 |
119,295 |
|
|
Cash (absorbed by) / generated from operations |
(197,393) |
34,334 |
|
|
Research and development tax credit received |
178,850 |
103,868 |
|
|
Net cash outflow from operating activities |
(2,461,603) |
(1,610,859) |
|
|
Cash flows from investing activities |
|||
|
Purchase of property, plant and equipment Purchase of intangible assets |
(13,367) (71,374) |
(29,721) - |
|
|
Interest received |
72,430 |
117,547 |
|
|
Net cash (absorbed by) / generated from investing activities |
(12,311) |
87,826 |
|
|
Cash flows from financing activities |
|||
|
Proceeds from issue of share capital (net of expenses) |
- |
1,425,000 |
|
|
Proceeds from borrowings |
250,000 |
- |
|
|
Net cash generated from financing activities |
250,000 |
1,425,000 |
|
|
Decrease in cash and cash equivalents |
(2,223,914) |
(98,033) |
|
|
Cash and cash equivalents at the beginning of the year |
2,979,926 |
3,077,959 |
|
|
Cash and cash equivalents at the end of the year |
756,012 |
2,979,926 |
Notes to the preliminary results
1. Basis of preparation
The preliminary results for the year ended 31 March 2009 have been extracted from the audited financial statements which have not yet been delivered to the Registrar of Companies. The financial information set out in this announcement does not constitute statutory financial statements for the year ended 31 March 2009 or 31 March 2008. The financial statements for the year ended 31 March 2009 were unqualified and did not contain a statement under section 237 of the Companies Act 1985. The statutory financial statements for the year ended 31 March 2008 have been delivered to the Registrar and were prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union, while the statutory financial statements for the year ended 31 March 2009 will be delivered to the Registrar following the Company's Annual General Meeting. The preliminary results have been prepared in accordance with IFRS as adopted by the European Union. The Group accounting policies used in the preliminary results are consistent with those applied in its most recent annual financial statements.
Going concern
On 29 May 2009, the Group signed an exclusive worldwide licence agreement with ALS. The licence grants ALS the exclusive right to manufacture, market, sell and distribute BugOil® in all fields except the home and garden and animal health markets.
Under the licence agreement ALS is also granted certain rights in relation to any further development of BugOil® by the Group. The Group reserves the right to engage in further research and development regarding BugOil®. The Group remains responsible for costs in relation to the maintenance of the BugOil® patents and obtaining the necessary regulatory approvals to sell BugOil® in the United Kingdom, the European Union and the United States. It is ALS's responsibility to register the product at state level in the United States and country level in the rest of the world.
The licence agreement provides that there shall be paid to the Group, milestone payments of increasing sums on:
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 for the period to 31 March 2011, including sensitivity analysis and taking account of reasonably possible changes in performance and achievement of certain regulatory milestones, 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 Group Financial Statements.
Critical accounting judgements in applying accounting policies
In the application of the Group's accounting policies the Directors are required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.
Critical accounting judgements in applying accounting policies
The following are the critical judgements, apart from those involving estimations, that the Directors have made in the process of applying the entity's accounting policies and that have the most significant effect on the amounts recognised in the financial statements.
Research and development activities
Management have reviewed the Group's research and development activities and have made judgements on the amount of development expenditure it is appropriate to capitalise. The key criterion which management have to make judgements about is technical and commercial viability of products.
Key sources of estimation uncertainty
Impairment of goodwill
Determining whether goodwill is impaired requires an estimation of the value in use attributable to goodwill. The value in use calculation requires the Directors' to estimate the future cash flows expected to arise and a suitable discount rate in order to the calculate present value.
Details of the impairment estimation are provided in note 5.
Share based incentive arrangements
Share based incentive arrangements are provided to management and certain employees. These are valued at the date of grant using the Black-Scholes option pricing model and management have to exercise judgement over the likely exercise period, interest rate and share price volatility.
Management uses various sources of information including its own share price performance, or where there is insufficient history the performance of comparable listed entities, experience from the historical exercise of options and published data on bank base rates.
2. Segmental Information
The Group has two primary reporting segments, crop nutrients and pest control. The secondary segment is based on geographical location. The segment results for the year ended 31 March 2009 are as follows:
|
Crop nutrients £ |
Pest control £ |
Unallocated £ |
Group £ |
|
|
Segment revenue |
829,616 |
- |
- |
829,616 |
|
Operating loss |
(220,653) |
(233,280) |
(2,092,393) |
(2,546,326) |
|
Finance income - net |
- |
- |
71,260 |
71,260 |
|
Loss before income tax |
(220,653) |
(233,280) |
(2,021,133) |
(2,475,066) |
|
Income tax credit |
- |
- |
219,991 |
219,991 |
|
Loss for the year |
(220,653) |
(233,280) |
(1,801,142) |
(2,255,075) |
|
Depreciation |
- |
- |
(15,234) |
(15,234) |
|
Other non-cash movements* |
- |
- |
(88,032) |
(88,032) |
The segment results for the year ended 31 March 2008 are as follows:
|
Crop nutrients £ |
Pest control £ |
Unallocated £ |
Group £ |
|
|
Segment revenue |
284,853 |
- |
- |
284,853 |
|
Operating loss |
(267,335) |
(191,823) |
(1,508,186) |
(1,967,344) |
|
Finance income |
- |
- |
120,343 |
120,343 |
|
Loss before income tax |
(267,335) |
(191,823) |
(1,387,843) |
(1,847,001) |
|
Income tax credit |
- |
- |
182,452 |
182,452 |
|
Loss for the year |
(267,335) |
(191,823) |
(1,205,391) |
(1,664,549) |
|
Depreciation |
- |
- |
(7,093) |
(7,093) |
|
Other non-cash movements* |
- |
- |
(211,190) |
(211,190) |
* Other non-cash movements represent share-based payments.
The segment assets and liabilities at 31 March 2009 and capital expenditure for the year then ended are as follows:
|
Crop nutrients £ |
Pest control £ |
Unallocated £ |
Group £ |
|
|
Assets |
810,392 |
588,713 |
1,122,487 |
2,521,592 |
|
Liabilities |
(522,621) |
(80,807) |
(626,620) |
(1,230,048) |
|
Capital expenditure - tangible |
- |
- |
13,367 |
13,367 |
The segment assets and liabilities at 31 March 2008 and capital expenditure for the year then ended are as follows:
|
Crop nutrients £ |
Pest control £ |
Unallocated £ |
Group £ |
|
|
Assets |
132,009 |
588,337 |
3,266,839 |
3,987,185 |
|
Liabilities |
(104,185) |
(51,295) |
(373,118) |
(528,598) |
|
Capital expenditure - tangible |
- |
- |
29,721 |
29,721 |
The analysis of revenue by destination is as follows:
|
Year ended 31 March 2009 £ |
Year ended 31 March 2008 £ |
|
|
United Kingdom |
38,987 |
4,500 |
|
Europe |
346,995 |
22,263 |
|
Middle East & Africa |
257,952 |
197,985 |
|
Americas |
185,682 |
60,105 |
|
829,616 |
284,853 |
All assets and capital expenditure are located within the United Kingdom.
3. Income tax credit
Income tax comprises tax credits booked against research and development eligible expenditure of £219,991 (2008: £182,452). The tax credit claims for previous years have all been received.
Unrelieved tax losses of £4,546,000 (2008: £3,037,000) remain available to offset against future taxable trading profits. No deferred tax asset has been recognised in respect of the losses as recoverability is uncertain.
4. Loss per ordinary share
The loss per ordinary share is based on the loss of £2,255,075 (2008: £1,664,549) and 26,310,813 (2008: 23,460,332) ordinary shares of 1p each, being the weighted average number of shares in issue during the period.
|
Year ended 31 March 2009 |
Year ended 31 March 2008 |
|
|
Loss attributable to equity holders of the Group (£) |
(2,255,075) |
(1,664,549) |
|
Weighted average number of ordinary shares in issue |
26,310,813 |
23,460,332 |
|
Basic and diluted loss per share (pence) |
(0.09) |
(0.07) |
The share options in issue are anti-dilutive in respect of the basic loss per share calculation and have therefore not been included.
5. Intangible assets
|
Goodwill £ |
Patents £ |
Development costs £ |
Total £ |
|
|
Year ended 31 March 2008 |
||||
|
Opening net book value |
585,383 |
- |
- |
585,383 |
|
Additions |
- |
- |
- |
- |
|
Closing net book value |
585,383 |
- |
- |
585,383 |
|
Year ended 31 March 2009 |
||||
|
Opening net book value |
585,383 |
- |
- |
585,383 |
|
Additions |
- |
- |
71,374 |
71,374 |
|
Closing net book value |
585,383 |
- |
71,374 |
656,757 |
|
As at 31 March 2009 |
||||
|
Cost or valuation |
585,383 |
15,523 |
71,374 |
672,280 |
|
Accumulated amortisation |
- |
(15,523) |
- |
(15,523) |
|
Net book value |
585,383 |
- |
71,374 |
656,757 |
|
As at 31 March 2008 |
||||
|
Cost or valuation |
585,383 |
15,523 |
- |
600,906 |
|
Accumulated amortisation |
- |
(15,523) |
- |
(15,523) |
|
Net book value |
585,383 |
- |
- |
585,383 |
Goodwill
Goodwill is allocated to the pest control segment and is not amortised but tested annually for impairment. To the extent that the carrying value exceeds the value in use, determined from estimated discounted future cash flows, goodwill is written down to the value in use and an impairment charge is recognised.
Capitalised development costs
The Group currently has internally generated intangible assets from the development of its Crop Nutrient products. All other development work has been written off as incurred where the criteria for recognition as an asset are not met.
Capitalised development costs are being amortised over a period of 20 years. The balance at 31 March 2009 will be amortised in full over the next 20 years which is considered by management to be representative of the useful economic life of Crop Nutrient products.
Impairment Review
During the year, goodwill was tested for impairment in accordance with IAS 36 "Impairment of Assets". The recoverable amount exceeded the carrying amount of goodwill recorded. The recoverable amount has been measured on a value in use calculation.
Key AssumptionsThe Group signed a licensing agreement with ALS for BugOil® on the 29 May 2009. The key assumptions used in the impairment review and licence agreement business model were:
Sensitivity analysis, as at 31 March 2009, has indicated that no reasonable foreseeable change in the key assumptions used in the impairment model would result in any changes to the financial statements.
6. Availability of the financial statements
Copies of the full statutory financial statements will be available shortly from the Company's registered office at 12 South Preston Office Village, Cuerden Way, Bamber Bridge, Preston, PR5 6BL and will also be available from the Company's website at www.plantimpact.com.
7. Annual General Meeting
The notice for the Annual General Meeting will be held sent to all shareholders in due course. The AGM will be held at the Company's registered office, 12 South Preston Office Village, Cuerden Way, Bamber Bridge, Preston, PR5 6BL.
About Plant Impact plc
Plant Impact addresses the increasing global demand for effective, sustainable and ecologically-sound products to combat environmental plant stress and improve crop productivity. Common environmental plant stresses include drought, salinity, nutrient deficiencies, pests and disease. Plant Impact's advances produce practical results that reduce inputs and benefit the whole of the agricultural value chain, providing solutions for growers, food manufacturers and consumers.
A broad product portfolio has been developed using these innovative and proprietary technologies, the most advanced of which are already being marketed and sold through established agricultural distribution networks. Products for the home and garden market are also distributed direct to consumers through reputable high street stores.
Current Plant Impact technologies include:
Alethea® - resistance to climate, water and salt stress;
CaT - reduction of physiological disorders;
Speedo™ - accelerated plant growth;
PiNT™ - higher yielding stronger plants; and
BugOil® - benign pest control.
For further information please visit www.plantimpact.com
Related Shares:
Plant Impact