26th Feb 2008 07:01
Stem Cell Sciences plc26 February 2008 Press Release Stem Cell Sciences PRELIMINARY RESULTS FOR THE YEAR ENDED 31ST DECEMBER 2007 ("Stem Cell Sciences", "SCS", "the Company") 26th February 2008 Stem Cell Sciences plc, a company focused on the commercialisation of stem cellsand stem cell technologies, announced today preliminary results for the yearended 31st December 2007. Highlights •Major licensing deal with Merck & Co., Inc. for the use of novel mouse neural stem cell technology to for research use providing SCS a signing fee and milestone payments. •Signing of a diabetes contract research agreement with a major biopharmaceutical company to validate its suite of cell processing technologies for the scaled, automated production of human embryonic stem cells (ES) and demonstrate the bulk production of cells relevant for diabetes research at the SCS' Cambridge production facility. •Launch of HEScGRO animal component-free medium for human embryonic stem cell (hES) research by Millipore Corporation under royalty paying license from SCS. •Successful, over-subscribed secondary listing on the Australian Stock Exchange raising AU$12.4 million (£4.94 million) in April. •Securing EU funding for NEUROscreen, a programme that aims to discover new CNS disease drug candidates. Of a total grant of €2.4 million over 3 years, approximately €0.42 million to SCS. •Licensing-in of several new technologies including: - ROCK (Rho-associated kinase) inhibitors to block cell death during transfer and scale-up from The Institute of Physical and Chemical Research of the RIKEN Centre for Developmental Biology (Kobe, Japan); - Novel human muscle cells from the San Raffaele Scientific Institute ( Milan, Italy) for drug discovery and toxicology applications; •Granting of a broad US patent covering all methods of purifying any type of mammalian stem cell (adult and embryonic) via any introduced gene. •Appointment of seasoned CEO, Dr Alastair Riddell in November. •Initiation of restructuring programme starting with the divestment of shares in SCS KK. Rights to commercialise all technology previously licensed to SCS KK have been returned. Also licensed their neural stem (NS) cell technology, for both research and stem-cell based therapies on a global basis. Financial Highlights •Turnover £0.6 million (2006: £0.7 million) •Gross profit £0.5 million (2006: £0.6 million) •Net loss £3.5 million (2006: £2.7 million) •Loss per share of 11.6p (2006: 12.2p) •Cash balance of £3.6 million at 31st December 2007 (2006: £2.5 million) Alastair Riddell, CEO of SCS, commenting on 2007 and the outlook for 2008, said: "The changes we started to implement in 2007 are the catalyst for significantchange in 2008, both in terms of business performance and operations. We believestrongly that revenue growth can be achieved by focused marketing of our stemcell product lines and technologies. We shall also actively prosecute ourextensive IP portfolio. As announced recently, we have implemented an operationsrationalisation and restructuring programme that will result in significant costsavings in the immediate future. We look forward to 2008 as a transformationaland successful year for SCS." - Ends - For further information, please contact: Stem Cell SciencesAlastair Riddell, CEO+44 (0)1223 499160 Halsin PartnersMichael Sinclair, Director+44 (0)20 7084 5955 Talk Biotech (Australia)Fay Weston+61 4 2220 6036 Notes to EditorsStem Cell Sciences plc (SCS, AIM:STEM, ASX:STC) in a leading provider of cellsand cell culture media to the burgeoning stem cell research market. Thesuccessful application of stem cells in both research and clinical applicationsis the reproducible supply of pure, fully characterised stem cells and stemcell-derived specialised cells such as nerves and muscle. By providing theseproducts, to the life sciences industry and academia for use in basic researchand drug discovery, Stem Cell Sciences has multiple potential revenue streams. Stem Cell Sciences has multiple industry collaborations, including MilliporeCorporation for the marketing and distribution of HEScGROTM, its serum freemedia for the growth of human embryonic stem cells and Merck & Co for the use ofmouse neural stem cell technology for research applications. To access cutting edge technologies on a rapid and on-going basis, Stem CellSciences has built an exceptional network of highly interactive collaborationswith academic centres of excellence in the stem cell field. These collaborationshave been the source of our founding technologies and continue to provide anexpanding pipeline of products and intellectual property that are central to theCompany's strategy and success. For further information on the company please visit: www.stemcellsciences.com Chairman's StatementAction and Decisiveness are appropriate descriptors of Stem Cell Sciences (SCS)today. We are in the midst of implementing steps focused on strengthening theCompany for both short and long-term shareholder value. The performance of theCompany on our respective AIM and ASX stock markets has been disappointing andwe are focused and committed to improving our commercial execution andoperational performance, achieving improved shareholder value. That is thecommitment we have to you...our valued investors.This year, as you already may know, we have taken decisive actions to reshapeour Company for growth and value development. We have sharpened our focus and asyou read this year's annual report, I believe you will share our optimism andenthusiasm regarding the future performance and success of Stem Cell Sciences.During 2007, the Board conducted a strategic review of the Company to determinehow best to proceed in a more commercial orientated manner. This resulted in theappointment of Dr Alastair Riddell as CEO and Executive Director, and thetransition Dr Peter Mountford into a position where his technical expertise canbe successfully leveraged accordingly. Dr Riddell has extensive experience inbuilding and running biotechnology companies. Following a complete review ofoperations, Dr Riddell and the Board implemented a comprehensive restructuringprogramme that was announced recently. We believe that these measures providesecure foundations for the future success of SCS. During 2007, SCS continued to build and invest in our stem cell technologicalleadership. In particular, we continued our core strategy of identifying new andemerging science that can be leveraged into both current and future commercialstem cell product offerings. A key achievement in this area was the licensing ofROCK (Rho-associated kinase) inhibitors from the RIKEN Centre in Japan. Thesecompounds, when added to stem cell media, increase the robustness of cellsallowing the large-scale automated production needed for industrial research andclinical applications, an important step forward. SCS now holds a worldwidelicense for the use of this technology. Our commercial development was recognised in 2007 reflected in agreements withMerck & Co for use of our mouse neural stem (NS) cell technology for researchuse and a large pharma partner in the diabetes field. The cells and technologyfor these collaborations originate from our new, state of the art automatedproduction facility in Cambridge that was opened in December 2006. Such progressin this new part of our operation provides confidence of future success in thisarea. SCS also secured an innovative collaboration with the Myelin RepairFoundation, which will hopefully lead to new advances in CNS research,particularly in multiple sclerosis. A major event for the Company during 2007 was our successful stock exchangelisting in Australia (ASX:"STC"). The support received by the investmentcommunity there has been highly satisfying and appreciated. We believe one of our most important tasks is not just to ensure a strongcurrent performance, but at the same time to create the conditions for long-termsuccess. Last year we took a major stride in that direction - in the interest ofthe company, our employees and, of course, our stockholders. In closing, I would like to thank you on behalf of the Board for your trust andyour support. I would also like to thank Jeremy Scudamore, a fellow board memberfor his dedication and service as a Non-Executive Director to SCS. Jeremyretired from the board in January 2008. As a Board, we are focused and committed to ensuring improvement in the value ofyour investment, delivering value to our customers and providing an excitingopportunity for employees to develop their careers. It is an honour to be a partof the many new and exciting developments underway at Stem Cell Sciences. I andthe other members of the Board appreciate your continued support and lookforward to updating you on our continued progress and results. Thank you. David A. Dodd, Chairman 25th February 2008 Chief Executive's Review I was appointed by the Board at the end of November to guide the company througha turnaround in performance. I conducted my review in November and December andmade recommendations for significant changes in the structure and organisationof the company, which were accepted. I have also engaged the new management teamin compiling a business plan for 2008 and 2009 that will see the company'sgrowth and development to a more sustainable, commercially orientated andexciting future. The principal objectives for the company this year are to increase revenues,reduce costs, generate shareholder confidence and significantly increaseshareholder value. In order to improve operational efficiency and reduce costs I decided toconcentrate our administration and UK research in Cambridge. We move into newpremises adjacent to our existing site on Babraham Research Campus in March.Subsequent to the year end we announced that we are closing the Edinburghfacility. Melbourne continues as a research centre of excellence. Several seniorpositions have also been made redundant and we move forward with a simpler, morecost effective structure. The cost saving from these changes are significant andwill benefit the income statement over the next two years by more than £1million. The revenue generating areas for growth fall into three categories anddemonstrate the company's focus on the use of stem cells in drug discovery andin developing the exciting new field of regenerative medicine. We intend to makefull use of the company's expertise and intellectual property built up over thelast 14 years in this endeavour. Our first objective is to secure at least onemajor pharmaceutical research collaboration this year. This is likely to be inassisting the partner in its search for small molecules that may play a role inassisting cell regeneration and in developing cell based therapies for thefuture. Our second objective is to pursue the value existing in our extensiveand fundamental intellectual property in the stem cell field. We are alreadyidentifying companies and institutions using our technology without the freedomto operate under a licence and will be seeking licences from them. Our thirdobjective is to realise the strategic value of our specialist stem cell mediabusiness. This will most probably be with a company specialising in themanufacture, distribution and sales of such material. We intend to retain acarried interest in this business and will continue to develop new media for thepartner. In research, the company has some potentially valuable early work in geneticallyengineered rats (taking place in Melbourne) and in the exciting field of thereprogramming of adult cells into stem cells, obviating the need for the use ofembryonic cells in regenerative medicine. Dedicated teams have clear sets ofobjectives in these areas. 2007 was a challenging year for the company but I am confident that the actionsI have already taken and the plans for the next two years will set the companyon a more secure and productive path. We aim to be in the vanguard of thisexciting area of discovery that has the potential to revolutionise the medicaltreatment of major diseases for which current therapies are problematic ornon-existent. Our deal with a major pharmaceutical company announced in Decemberwill assist that company in its search for new treatments for diabetes and ourrecently announced collaboration with the Myelin Repair Foundation could pavethe way for new treatments for multiple sclerosis. Finally, it is important for our investors and collaborators to know that all ofour cells are derived from fully informed and consented donors, these cells wereobtained with no financial inducement and with permission specifically forresearch and commercialisation purposes. We will continue to maintain thehighest ethical stance in this sensitive area of medical research. Alastair Riddell, CEO 25th February 2008 CONSOLIDATED BALANCE SHEET AS AT 31 DECEMBER 2007 2007 2006 £'000 £'000ASSETS Non-current assets Property, plant and equipment 516 656Intangible assets 290 221Investment in equity accounted investees - 284 ----------- ------------Total non-current assets 806 1,161 ----------- ------------Current assetsTrade and other receivables 333 584Current tax assets 133 62Cash and cash equivalents 3,607 2,463 ----------- ------------Total current assets 4,073 3,109 ----------- ------------ Total assets 4,879 4,270 ----------- ------------ LIABILITIES Non-current liabilities Deferred income (77) (111) ----------- ------------ Current liabilities Trade and other payables (669) (1,099)Deferred income (148) (43) ----------- ------------Total current liabilities (817) (1,142) ----------- ------------ Total liabilities (894) (1,253) ----------- ------------ Net assets 3,985 3,017 =========== ============ EQUITY Share capital 335 223Share premium 6,536 2,297Capital redemption reserve 10,928 10,928Foreign exchange reserve (110) (119)Merger reserve (1,248) (1,248)Retained deficit (12,456) (9,064) ----------- ------------ Total equity attributable to equity holders of thecompany 3,985 3,017 =========== ============ CONSOLIDATED INCOME STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2007 2007 2006 £'000 £'000 Revenue 593 742 Cost of sales (108) (157) ----------- -----------Gross profit 485 585 Other income 258 367Administrative expenses (2,980) (2,505)Research and development expenses (1,335) (1,055) ----------- -----------Loss from operating activities (3,572) (2,608) ----------- ----------- Finance income 230 178Finance expenses (4) - ----------- -----------Net finance income 226 178 ----------- ----------- Share of loss of equity accounted investee (294) (468)Gain on dilution of equity accounted associate - 126 ----------- -----------Loss before income tax (3,640) (2,772) Income tax credit 133 62 ----------- ----------- =========== ===========Loss for the year attributable to (3,507) (2,710) equity holders of the company =========== =========== Loss per shareBasic (11.6)p (12.2)pDiluted (11.6)p (12.2)p CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2007 2007 2006 £'000 £'000 Cash flows from operating activitiesLoss for the year (3,507) (2,710)Adjustments for:Depreciation 178 91Amortisation 39 20Capitalised development costs (108) (162)Deferred income released (123) (18)Amounts provided against investment - -Finance income (230) (178)Finance expense 4 -Share of loss of equity accounted investee 294 468Gain on dilution of equity accounted - (126)investeeEffect of changes in foreign exchange (10) -ratesEquity settled share based payment 115 130transactionsIncome tax income (133) (62) ------------ ----------- (3,481) (2,547)Decrease/(increase) in trade and other 277 (633)receivables(Decrease)/increase in trade and other (430) 612payables ------------ ----------- (3,634) (2,568)Interest paid (4) -Income taxes received 62 121 ------------ -----------Net cash used in operating activities (3,576) (2,447) ------------ ----------- Cash flows from investing activitiesInterest received 204 152Acquisition of plant and equipment (34) (636)Grant income received 194 172 ------------ -----------Net cash from / (used in) investing 364 (312)activities ------------ ----------- Cash flows from financing activitiesProceeds from issue of share capital 4,351 - ------------ -----------Net cash from financing activities 4,351 - ------------ ----------- Net increase/(decrease) in cash and cash 1,139 (2,759)equivalents Cash and cash equivalents at start of year 2,463 5,227Effect of foreign exchange rate changes 5 (5) ------------ -----------Cash and cash equivalents at end of year 3,607 2,463 ============ =========== CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 DECEMBER 2007 Attributable to equity holders of the companyGROUP Share Share Capital Foreign Merger Retained Total premium redemption exchange reserve deficit reserve reserve capital equity £'000 £'000 £'000 £'000 £'000 £'000 £'000 Balance at 1January 2006 11,151 2,297 - - (1,248) (6,484 5,716 Total incomeand expenserecogniseddirectly inequity beingexchangedifferencesarising ontranslation ofoverseasoperations - - - (119) - - (119)Loss for theperiod - - - - - (2,710 (2,710) -------- -------- --------- -------- -------- -------- -------Totalrecognisedincome andexpense forthe period - - - (119) - (2,710) (2,829) -------- -------- --------- -------- -------- -------- -------Share basedpayments - - - - - 130 130Capitalreconstruction(10,928) - 10,928 - - - - -------- -------- --------- -------- -------- -------- -------Balance at 31December 2006 223 2,297 10,928 (119) (1,248) (9,064) 3,017 -------- -------- --------- -------- -------- -------- ------- Total incomeand expenserecogniseddirectly inequity beingexchangedifferencesarising ontranslation ofoverseasoperations - - - 9 - - 9Loss for theperiod - - - - - (3,507) (3,507) -------- -------- --------- -------- -------- -------- -------Totalrecognisedincome andexpense forthe period - - - 9 - (3,507) (3,498) -------- -------- --------- -------- -------- -------- -------Share basedpayments - - - - - 115 115Issue of sharecapital 112 4,239 - - - - 4,351 -------- -------- --------- -------- -------- -------- -------Balance at 31December 2007 335 6,536 10,928 (110) (1,248) (12,456) 3,985 ======== ======== ========= ======== ======== ======== ======= Notes to the Preliminary Announcement 1. Financial information This preliminary announcement contains the financial information of the StemCell Sciences plc (the "Company") and its subsidiaries (together referred to asthe "Group") for the year ended 31 December 2007. This financial information is extracted from the consolidated financialstatements of the Group prepared under International Financial ReportingStandards as adopted by the EU ("adopted IFRSs") for the first time andtherefore IFRS 1 "First-time adoption of International Financial ReportingStandards" has been applied. An explanation of the transition to adopted IFRS isprovided in note 5 below. The Group's transition date to IFRS is 1 January 2006and the Group prepared its opening balance sheet at that date in accordance withIFRSs effective at 31 December 2007 except as specified below. In preparing thefinancial statements the Group applied mandatory exceptions and certain of theoptional exemptions available in IFRS 1 from the full retrospective application. This preliminary announcement was authorised by the Board on 25 February 2008 The financial information set out in this announcement for the years ended 31December 2007 and 2006 does not constitute the Group's statutory accounts forthese years within the meaning of Section 240 of the Companies Act 1985. Thestatutory accounts for 2006, which were prepared under UK GAAP, have beendelivered to the Registrar of Companies, and those for 2007, prepared underaccounting standards adopted by the EU will be delivered in due course.Theauditors have reported on those financial statements. The auditors' reports were(i) unqualified; (ii) included references to matters to which the auditors drewattention by way of emphasis without qualifying their reports; and (iii) did notcontain statements under section 237(2) or (3) of the Companies Act 1985. In the2007 financial statements the auditors' report contains an emphasis of matterconcerning going concern and capitalised development expenditure. In the 2006financial statements their report contained an emphasis of matter concerninggoing concern and the carrying value of an investment in an associate. 2. Basis of preparationGoing concernThe financial statements are prepared on a going concern basis which thedirectors believe to be appropriate for the following reasons. The Group is involved in the research, development and commercialisation of stemcells and stem cell technology. At this stage of its development it has limitedrevenues arising from licensing arrangements, contract research and productsales and its costs exceed its revenue. The Group will continue to absorb cashuntil its products are commercialised. The Group's current cash resources are forecast by the directors as beingsufficient to enable it to continue to trade for the foreseeable future. Howeverthe projections include revenues which are not certain and which significantlyexceed those received in previous years. The Directors are currently in theprocess of talking with prospective licensing partners and other customers andhave a reasonable expectation that these discussions will be successful. If therevenue remains consistent with previous years the Directors forecast that theGroup's cash resources will be used by March 2009. While there can be no certainty that the forecast revenues will be generated,the Directors are of the opinion that, taking into account existing cashresources available to the Group, sufficient revenue will be generated to enablethe Group to continue to trade for at least twelve months from the date ofapproval of these financial statements. If the revenue generation is later thananticipated the Directors would take appropriate steps to reduce the level ofcash outflow. However, as noted there can be no certainty in relation to these matters, whichmay cast significant doubt on the group's ability to continue as a going concernand doubt over the recoverability of capitalised development expenditure. Thegroup may therefore, be unable to continue realising its assets and dischargingits liabilities in the normal course of business but the financial statements donot include any adjustments that would result from the going concern basis ofpreparation being inappropriate. The financial information set out in this announcement has been prepared on thehistorical cost basis and in accordance with International Financial ReportingStandards and their interpretations as adopted by the European Union ("adoptedIFRS"). 3. Significant accounting policies RevenueRevenue represents amounts receivable from product sales, collaborative researchagreements and license fees net of sales related taxes. Revenue is recognised when there is evidence of an agreement, delivery of theproduct has occurred and the selling price is determined. No revenue isrecognised if there are significant uncertainties regarding recovery of theconsideration due, associated costs or the possible return of products. a) Product sales are recognised as revenue when thesignificant risks and rewards of ownership have been transferred to the buyer.b) Fees for collaborative research are deferred and recognisedover the period of the agreementc) Revenue is recognised immediately in respect of licensedtechnology once all significant performance obligations have been met. Intangible assetsResearch and developmentExpenditure on research activities undertaken with the prospect of gaining newscientific or technical knowledge and understanding, is recognised in the incomestatement when incurred. Development activities involve a plan or design for the production of new orsubstantially improved products and processes. An internally-generatedintangible asset arising from the Group's development expenditure is recognisedonly if all of the following conditions are met: • an asset is created that can be identified (such as new processes); • there is an intention to complete and use the intangible asset; • it is probable that the asset created will generate future economic benefits; • the development cost of the asset can be measured reliably; • the product or process is technically and commercially feasible; and • sufficient resources are available to complete the development and to either sell or use the asset. Development costs recognised as intangible assets are amortised over theirexpected useful lives. Where no internally-generated intangible asset can be recognised, developmentexpenditure is recognised as an expense in the period in which it is incurred. Research and development costs include personnel charges in respect of personsworking wholly or exclusively on process or product development. 4. Loss per share Basic and diluted loss per shareThe calculation of basic loss per share at 31 December 2007 was based on theloss attributable to ordinary shareholders of £3,507,000 (2006: £2,710,000) anda weighted average number of ordinary shares outstanding during the year ended31 December 2007 of 30,351,000 (2006: 22,301,000), calculated as follows: 2007 2006 (000) (000) Issued ordinary shares at 1 January 22,301 22,301Effect of shares issued in April 2007 8,050 - ----------- --------Weighted average number of ordinary shares at 31 December 30,351 22,301 =========== ======== The loss attributable to ordinary shares and the number of ordinary shares forthe purpose of calculating the diluted earnings per share are identical to thoseused for basic earnings per share. The exercise of share options would have theeffect of reducing the loss per share and consequently is not taken into accountin the calculation for diluted loss per share. At 31 December 2007 there were 2,736,200 (2006: 1,833,788) options outstandingwith an average exercise price of £0.47 (2006: £0.50) which are not included inthe calculation of diluted earnings per share because they are anti-dilutive atthose dates. 5. Explanation of transition to IFRSs This is the first year that the Company has presented its financial statementsunder IFRSs. The following disclosures are required in the year of transition.The last financial statements under UK GAAP were for the year ended 31 December2006 and the date of transition to IFRSs was therefore 1 January 2006. Reconciliation of consolidated income statement for year end 31 December 2006 UK GAAP IAS 38 Restated under IFRS £'000 £'000 £'000Revenue 742 - 742Cost of sales (157) - (157) ------------- ----------- --------------Gross profit 585 - 585 Research and development (1,197) 142 (1,055)Administrative expenses (2,505) - (2,505)Other income 367 - 367 ------------- ----------- --------------Operating loss (2,750) 142 (2,608)Net finance costs 178 - 178Share of results of (468) - (468)associateGain on dilution of equityaccounted - 126 126associate ------------- ----------- --------------Loss before tax (3,040) 268 (2,772)Taxation 62 - 62 ------------- ----------- --------------Loss for period (2,978) 268 (2,710) ============= =========== ============== Under UK GAAP accounting policies, research and development expenditure wascharged to profit and loss account when incurred. Under IAS 38 IntangibleAssets, the Group capitalises development expenditure that meets the criteriaset out in the standard. The Group's accounting policy in respect of researchand development expenditure is set out in note 3 to this financial information. Under IFRS the gain on dilution of investment in an equity accounted associateis recognised in the income statement. Under UK GAAP this dilution was dealtwith as an adjustment to reserves. 5. Explanation of transition to IFRS (cont'd)Reconciliation of equity as at 31 December 2006 UK GAAP IAS 38 IFRS 1 Total effect Restated of under transition IFRS to IFRS (a) (b) £'000 £'000 £'000 £'000 £'000 Non-current assets Property,plant andequipment 656 - - - 656Intangibleassets - 221 - 221 221Investmentsaccounted forusing theequity method 284 - - - 284 -------- -------- -------- -------- ------- 940 221 - 221 1,161 -------- -------- -------- -------- ------- Current assetsTrade andotherreceivables 584 - - - 584Current taxassets 62 - - - 62Cash and cashequivalents 2,463 - - - 2,463 -------- -------- -------- ------- ------- 3,109 - - - 3,109 -------- -------- -------- -------- ------- Total Assets 4,049 221 - 221 4,270 -------- -------- -------- ------- ------- Non-currentliabilities Deferredincome 111 - - - 111 Current liabilities Trade andother payables 1,099 - - - 1,099Deferredincome 43 - - - 43 -------- -------- -------- ------- -------TotalLiabilities 1,253 - - - 1,253 -------- -------- -------- ------- ------- Net Assets 2,796 221 - 221 3,017 ======== ======== ======== ======== ======= Capital and reserves Share capital 223 - - - 223Share premiumaccount 2,297 - - - 2,297Capitalredemptionreserve 10,928 - - - 10,928Foreignexchangereserve (144) - 25 25 (119)Merger reserve (1,248) - - - (1,248)Retainedearnings (9,260) 221 (25) 196 (9,064) -------- -------- -------- -------- ------- Total Equityattributableto ordinaryshareholders 2,796 221 - 221 3,017 ======== ======== ======== ======== ======= 5. Explanation of Transition to IFRS (cont'd)Reconciliation of equity as at 1 January 2006 UK IAS38 IFRS Total effect of Restated GAAP 1 transition to IFRS under IFRS (a) (b) £'000 £'000 £'000 £'000 £'000 Non-currentassets Property,plant andequipment 115 - - - 115Intangibleassets - 79 79 79Investmentsaccounted forusing theequity method 710 - - - 710 -------- -------- ------- -------- -------- 825 79 - 79 904 -------- -------- ------- -------- -------- Current assetsTrade andotherreceivables 322 - - - 322Cash and cashequivalents 5,227 - - - 5,227 -------- -------- ------- -------- -------- 5,549 - - - 5,549 -------- -------- ------- -------- -------- Total Assets 6,374 79 - 79 6,453 -------- -------- ------- -------- -------- Non-currentliabilities Trade and other - - - - -payables Currentliabilities Trade andother payables (737) - - - (737) - - -------- -------- ------- -------- --------TotalLiabilities (737) - - - (737) -------- -------- ------- -------- -------- Net Assets 5,637 79 - 79 5,716 ======== ======== ======= ======== ======== Capital andreserves Share capital 11,151 - - - 11,151Share premiumaccount 2,297 - - - 2,297Foreignexchangereserve (25) - 25 25 -Merger reserve (1,248) - - - (1,248)Accumulatedprofits (6,538) 79 (25) 54 (6,484) -------- -------- ------- -------- -------- Total equityattributableto ordinaryshareholders 5,637 79 - 79 5,716 ======== ======== ======= ======== ======== Notes to the reconciliations of equity a) IAS 38 intangible assets has resulted in the Group capitalising developmentexpenditure that meets the criteria set out in the standard. The Group'saccounting policy in respect of research and development expenditure is set outin note 3 to this financial information.b) The group has taken advantage of the exemption under IFRS 1 - First TimeAdoption of International Financial Reporting Standards to reset cumulativetranslation differences at the date of transition to zero. Cash flow statementA separate cash flow reconciliation has not been provided in the notes as allinformation relevant to understanding the cash flow statement has been includedon the face of the statement. Transition to IFRS has resulted in the Companydisclosing a cash flow statement for the first time. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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