28
June 2024
ProBiotix Health plc
("ProBiotix" or the "Company" or the "Group")
Final
results
Notice of
AGM
ProBiotix Health plc (AQSE: PBX), a
life sciences
business developing probiotics to
tackle cardiovascular disease and other
lifestyle conditions, announces its audited results for the period ended 31 December
2023.
Highlights
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Distribution agreement with Trans Chem for
finished turnkey products in Australia and New Zealand
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Appointment of Niels Peter Bak as Technical
Product Manager
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Launch of CholbiomeCH a dual action
bilayer tablet containing phytosterols and LPLDL to
increase opportunities in the US market
Post
period end
á
Appiontment of Michael
Litichevski as Head of Global Sales
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Appointment of Mads Brandt as Global Supply Chain
Director
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Partner agreement with SymbioPharm
Investor presentation
The Company will host a presentation
for investors via the Investor Meet Company platform on Wednesday,
10 July at 11am BST. The presentation is
open to all existing and potential shareholders. Questions can
be submitted pre-event via your Investor Meet Company dashboard up
until 9 July 2024 at 9am BST, or at any time during the live
presentation. Investors can sign up to
Investor Meet Company for free and add to meet ProBiotix Health plc via:
https://www.investormeetcompany.com/probiotix-health-plc/register-investor
Investors who already
follow ProBiotix Health plc on the Investor Meet
Company platform will automatically be invited.
Steen Andersen, CEO of ProBiotix,
commented: "We have continued to develop
a business on becoming a solutions provider of
finished probiotic products in consumer formats, both under our own
brands and partner private labels, with the objective of building
ProBiotix into a £10m turnover company in the years ahead. We
look to the future with enthusiasm and high confidence in building
a valuable company for shareholders."
For
further information, please contact:
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ProBiotix Health plc
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https://probiotixhealth-ir.com/
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Steen Andersen, Chief
Executive
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Contact via Walbrook
below
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Peterhouse Capital Ltd (Aquis Corporate Adviser and
Broker)
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Tel: 020
7220 9797
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Mark Anwyl
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Tel: 020
7469 0930
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Duncan Vasey
Brefo Gyasi
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Walbrook PR Ltd
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probiotix@walbrookpr.com
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Anna Dunphy
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Mob: 07876
741 001
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Chairman and Chief Executive's Report
This Annual Report presents the
Company's inaugural full year results as a listed public company on
the Aquis Stock Exchange.
The Company demonstrates strong sales growth, significant
commercial traction, continued R&D and organisational progress.
In 2023, the Company implemented a new focussed 5-year growth
strategy aiming at becoming a leading provider of turnkey private
label probiotic dietary supplements within the preventative
cardiometabolic health segment, taking off-set in the Company's
principal proprietary probiotic strain LPLDL. The positive
progress to date is testimony to a successful implementation of the
strategic plan, the uniqueness of the Company's products and a
differentiated value proposition in a growing market for
cardiometabolic health, probiotic and healthy aging products. The
Board and Management are confident that the present market
capitalisation of the Company reflects current public market
conditions and not the progress of the Company
Strategic overview
ProBiotix is a life sciences company
focused on linking probiotics with the
human microbiome addressing aspects of cardiometabolic health
and other lifestyle conditions occurring
throughout the span of life. ProBiotix operates in the dietary supplement and prevention
segment and taps into the cross field of healthy aging,
cardiometabolic health and probiotic supplements.
ProBiotix's purpose is to provide consumers
and industry world-wide with uncompromised supply and service of
safe and scientifically validated probiotic-based microbiome
product solutions for the improvement of human
health. The Company aims to partner with
scientifically driven dietary supplement, consumer health and OTC
companies globally who have a strong strategic focus on the human
microbiome and the use of probiotics.
Every year, 20 million people die
from cardiometabolic disease related issues globally - a trend
which has risen by 50% over the past 30 years (Source: World Hearth
Federation, Report 2023 + IHME 2019). It is estimated that
approximately 80% of these deaths could be avoided by preventative
treatment combined with life-style changes. Yet the category of
dietary supplements with sufficient clinically documented efficacy
remains limited.
The global consumer probiotics supplement market
is forecast to reach $10.9 billion by 2028 (Fortune Business
insights, 2023) at a CAGR of 7.9%. The market is driven by an
increasing consumer awareness towards healthy living, disease
prevention and focus on the importance of dietary supplementation
as an assisting aid in the support of a good health throughout
life. Cardiometabolic related diseases remain one of the top causes
of death globally which puts the category on top of the agenda for
many consumers and legislators and thus offers exceptional growth
opportunities for the category, and especially probiotic-based
solutions.
Alongside the fast growing probiotic supplement market, the
preventative category within cardiometabolic health is estimated to
reach a consumer market value of $16.2 billion by 2028
(www.precedenceresearch.com/cardiovascular-health-supplements-market).
ProBiotix is tapping into an
attractive market with an estimated total consumer value of $27.1
billion by 2028 and with an outlook expected to have a relatively
limited number of clinically backed probiotic-based dietary
supplements available to cater for the consumer needs in the
category. This allows ProBiotix an excellent opportunity to
manifest the Company as a leading player in the field.
Source:
Fortune Business insights, 2023
www.precedenceresearch.com/cardiovascular-health-supplements-market
The Company has completed four
independent clinical studies with human volunteers as well as one
partner-driven study with 434 subjects which all consistently show
that ProBiotix's principal probiotic strain, Lactobacillus
plantarum ECGC13110402 (LPLDL), has the ability to
reduce key cardiovascular risk markers, such as total cholesterol,
LDL (bad) cholesterol, and Apolipo protein B (biomarker of
atherosclerosis), by up to 34.2 per cent, 28.4 per cent and 28.6
per cent, respectively.
ProBiotix commercialises a unique
range of proprietary private label turn-key dietary supplements,
all based on LPLDL
under the Company's business-to-business umbrella
of YourBiotix.
The Company has defined a focussed strategy to
develop the business and explore the market opportunities through
geographical expansion, development of new and attractive dosage
formats combined with broadening the clinical use of
LPLDL and other
proprietary strains in the pipeline. In
2023, the YourBiotix portfolio comprised of four unique
products:
YourBiotixCH
A capsule formula which contains LPLDL as the only
active ingredient to focus on healthy cholesterol
maintenance.
YourBiotixCH InstaMelt
An innovative direct dose stick formula which contains
LPLDL as the only active ingredient to focus on healthy cholesterol
maintenance.
YourBiotixBP
A blood
pressure-reducing tablet formula that combines four science-backed
natural ingredients - LPLDL, Thiamine (Vitamin B1),
L-arginine and CoEnzyme Q10 - to provide a
multi-targeted mechanism approach for aiding hypertension and
improving cardiovascular health.
YourBiotixVH
A vascular health
capsule formula that combines three specialised ingredients in a
triple layer tablet. Consisting of LPLDL, Thiamine and
Vitamin K2 Vital (from Kappa Bioscience) to provide a
multi-targeted mechanism to work against the build-up of lipid and
calcium deposits in the blood vessels.
In addition to representing ready to
market solutions, the YourBiotix product portfolio provides a
unique springboard to create customised formulations as a door
opener to individual customers and the widest possible range of
opportunities within international markets, such as North
America.
Key
milestone achievements
Strategy
In early 2023, a new
ambitious 5-year growth strategy was
implemented focused on becoming a provider of full turnkey private
label finished probiotic dietary supplements. Moving towards final product formats allows ProBiotix to
strengthen the differentiated value proposition of the Company by
de-bottlenecking the customer challenges when handling sensitive
live probiotic strains in their own manufacturing. The strategy
increases customer loyalty and builds barriers around the business,
driving revenue growth and profitability potential.
Commercial
2023 set a landmark for the
Company's continued double digit growth rates. Several new products
were launched in Germany, China, Taiwan, and Malaysia and the
Company also experienced continued growth from existing products on
the market in USA, Italy, and other European countries.
á
Launch of YourBiotix in Germany in partnership
with Germany's third largest pharmacy brand under their Symbiolact
brand umbrella. The launch is part of Symbiopharm's long term
strategy to further build their leading position within the
preventative cardiometabolic health segment through introduction of
clinically backed supplements in the cardiometabolic
space.
á
Successful growth in Germany and expansion into
China through a long-standing commercial German partner. The
geographical expansion of the brand is expected to continue to hold
significant growth potential with the potential opportunity to
launch line extensions for the Chinese market once the first
product has successfully established a position in the
market.
á
Significant investment in rebranding by Italian
commercial partner to allow for further growth of their existing
brand outside the practitioner category by tapping into the
attractive Italian consumer health segment and mega consumer trend
within healthy aging.
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Continuation of robust growth by US-partner driven
by diversification into new sales channels and distribution
platforms combined with strong consumer advertisement.
á
Product launch by Taiwanese partner with a strong
focus on online sales of products within the cardiometabolic area.
Additional SKUs anticipated launchingduring 2025, once the first
product has successfully settled in the market.
In the middle of 2023, a distribution agreement was entered with
leading Australian distributor TransChem allowing for exploration
of business opportunities in Australia/New Zealand, South-East Asia
and cross-border sales into China. YourBiotix has been introduced
to leading brands in the region which has led to several commercial
projects with significant potential commercial value already
underway.
Our sales pipelines in Europe and
USA were lifted to the next level of robustness with a doubling of
active sales projects including a number of strategic projects with
leading brands moving towards a 2025 or 2026 launch.
Operations
The Company expanded its network of
strategic contract manufacturers in both Europe and North America
during the course of 2023 with the objective of being ready to
absorb the significant trajected sales growth throughout the
planning period. Alongside focus shifting from bulk strain sales to
sales of finished turnkey solutions, there will be an increasing
need for flexibility to cater for product customization needs,
focus on supply security and risk mitigation as well as a desire to
capture the value created by economy of scale alongside the
trajected volume growth.
Research & Development
In 2023, ProBiotix launched a new
innovate and groundbreaking direct dosage stick format
- YourBiotix InstaMelt
- to accommodate the need for innovation and differentiation
requested by our partners. This new dosage holds the key to opening
an attractive market segment with consumers suffering pill fatigue
or inability to take tablets or pills. The product is a first of
its kind within cardiometabolic health probiotic supplements and
offers a unique experience of melting directly in the mouth. The
InstaMelt stick has a global appeal and plays a vital role in the
Company's strategy for penetration of the APAC region. The
InstaMelt technology will support building additional entry
barriers around the business and position ProBiotix as an innovator
and industry disruptor.
A comprehensive retrospective study
was published on the use of the AlfaSigma brand Ezimega3 containing
LPLDL, as the key active ingredient. The study included
434 Italian subjects and is the largest to date of its kind on
LPLDL containing commercial products. The 434 subjects
included measurement in several demographic subgroups and captured
the reduction in LDL cholesterol (bad cholesterol) as well as
perceived wellbeing after 3-6 months' intake of Ezimega3. The study
resulted in very positive and consistent results and once again
confirmed the in-vivo efficacy of LPLDL by showing an
average lowering of LDL cholesterol of 15.8% - 21.8% and improved
the perceived wellbeing by 14.4% - 33.0% depending on sub-group.
The result of the study opens additional commercial opportunities
for the use of LPLDL within new consumer segments like
peri-menopausal women and individuals with an active
lifestyle.
In 2023, the Company also
commenced its fourth own clinical study, which is a
multicenter, double-blind, placebo-controlled, randomized clinical
study on the efficacy of YourBiotix in combination with stanols and
sterols in improving blood lipid profiles in hypercholesterolaemic
adults with coeliac disease diagnosis conducted in Italy
(University of Salerno) and the UK (University of Roehampton). With
the Italian cohort of twenty-nine volunteers completed, results are
aligned with previous studies showing statistically significant and
biologically relevant improvements in total cholesterol,
LDL-cholesterol and apolipoprotein B, all recognized risk
biomarkers for coronary heart disease. The results for the Italian
cohort were presented at Probiota Milan 2024 in DATE. The UK cohort
Is currently being recruited
Results
Sales for the year showed an
increase of 27.8% to £1.67m (2002:£1.31m) with a gross profit
of £872k (2022:£739k). Administration costs rose during the
year to £1.55m (2022: £800k) as part of the plan to
build a strong platform in order to implement the 5 year growth
strategy. After administrative costs and share based payments
expenses there was a loss before tax of £769K,
(2022:£262k)
The Group ended the year in a very
strong financial position with cash balances totalling £1.51m.
(2022:£1.74m).
Board and Management
In 2023, as a pivotal part of
securing the foundation for a strong strategy implementation, the
Company has been focussing on building the organisational platform
and successfully onboarded a strong and experienced team to support
the business.As a result, the Company has benefitted from several
senior management appointments which collectively bring to the
Company more than 100 yearsÕ industry and market
experience.
á
Appointment of Mr. Niels Peter Bak as Head of
Product Management was announced in July 2023. Niels Peter
joined the management team in September 2023 as a
cornerstone in securing diligent executing of the Company's
strategy to focus the business on finished supplement dosage
formats, further accelerating product formulation development and
increasing the responsiveness to individual customer requirements
for customisation. Niels Peter is a talented industry veteran with
a proven track record in strategy execution, business to business
product management, product development and technical
marketing. Niels
Peter has held senior technical and commercial positions with Chr.
Hansen, ADM, Deerland Probiotics & Enzymes, Bifodan and
LactoBio.
á
Mr. Michael Litichevski
was appointed Head of Global Sales in late 2023 and joined the
Company on 1 January 2024. The onboarding of Michael is part of the
Company's strategy to build a strong commercial team and local
market presence to support the long-term growth, build sales
pipeline and increase customer access. Michael has contributed with
over 25 years' experience in building B2B sales, of which more than
11 years specifically within commercialisation of innovative and
high quality probiotic dietary supplements. He has previously held
positions like VP of Sales at Deerland Probiotics & Enzymes, VP
sales of Bifodan and has worked in commercial positions for large
organisations such as Orkla Health and Nycomed Pharma.
á
Mr. Mads Brandt was appointed Head of Global
Supply Chain in October 2023 and started working in the Company in
December 2023. The hiring of Mads is a key anchor point in building
a strong infrastructure to support the supply of product to the
increasing number of customers and order lines arising from the
strategy execution. Mads has held several senior supply chain and
operations positions with companies like Leo Pharma, Dako,
Unomedical as well as having acted as management consultant
assisting several leading pharmaceutical, medical device and
nutrition companies with supply chain and operation strategy and
optimisation.
The Company anticipates implementing
further changes to the Board, Management, and organisation as
needed to successfully progresses the execution of the growth
strategy of becoming a leading solutions provider of finished
probiotic supplements within metabolic health and healthy aging and
to capitalise on the opportunities created by the Company's
promising growing sales pipeline and customer portfolio.
Outlook
ProBiotix has started 2024
continuing the strong trade from 2023. The current order holding,
the maturity of the sales project pipeline with both new and
existing customers combined with the increased traction in our two
key markets - EMEA and NA Ð lead Management to have a positive
outlook for the year.
Our efforts to establish a strong
commercial presence in USA, which the Company started up in early
2023, is showing first indications of successful implementation
through manifestation of several new sales projects with leading
regional brands having an anticipated planned product launch for
2025 or 2026. There is a strong consumer movement in the Healthy
Aging space in the USA, and consequently, the leading brands are
showing an increased interest in the cardiometabolic prevention
area. Our YourBiotix portfolio, and especially
LPLDL, has proven to hold a strong position as
offset for executing the required customisation driven by the US
market needs, leading to a significant increase in the number of
new sales projects being started.
The instrumental approach and
increase in the commercial activities in Europe focussing on
specific selected markets such as Germany, France, Spain, and
UK/Ireland has already this year manifested itself in a significant
expansion of the sales project pipeline and is expected to pave the
way for continued positive and steady growth of our revenue
generated out of this region over the years to come.
The initial - but very promising -
steps have been taken to form the strategic approach for the APAC
region. In 2024, we have started testing our value proposition in
China and South Korea as these markets have a high affinity to our
value proposition which resonates well with both industry and
consumer trends. Management believes that the initial positive
interest from these markets is a strong indicator for the future
potential once the second phase of the strategy plan will be rolled
out in early 2026.
Our new InstaMelt stick has been introduced at the
annual global Health & Nutrition exhibition Vitafoods in Geneva
in May 2024 with more than 100 relevant leads generated in total. A
significant number of promising leads are linked to the new
InstaMelt stick based on which it is our assessment that the
innovative product concept resonates well with our
business-to-business customers as well as with consumers. InstaMelt
will be showcased at North America«s largest Health & Nutrition
exhibition Supply Side West in late October. 2024 The product
concept is anticipated to receive the same level of positive
interest as was observed at Vitafoods. Based on the positive
traction of the InstaMelt stick thus far, we are confident that the
technology will be a lever to open the attractive North
American market and a perfect fit with the attractive multilevel
marketing segment. Together with the rest of the products in our
portfolio, InstaMelt is believed to provide differentiation and
ability to create the foundation for a robust expansion of the
North American sales project pipeline and customer
base.
Our short- and medium-term focus will remain on building the
customer acquisition in Europe, establishing the commercial
platform in North America alongside further maturing the
organisation to be able to respond to the continued growth of the
business. We will maintain focus on developing turnkey consumer
solutions and continue the transitioning from sales of bulk
ingredients to finished formats. As part of our focus on finished
products, we will continue to expand our range by developing new
dosage formats such as chewable tablets and develop new and
improved packaging formats to extend shelf-life. In research and
development, we will increase focus on developing or in-licensing
new probiotic strains to cater for expansion of our product
offering to additional indication area within the mega consumer
trend of Healthy Aging and sustain the robustness of our
cardiometabolic health claims on LPLDL.
This strategy represents a clear
five-year pathway to lay the ground for ProBiotix to reach the
aspiration level of building annual sales of £10 million while
shifting the balance of the business from bulk sales of
LPLDL to sales of finished products.
By the additions to the management
team in 2023, the organisational foundation has been established.
In order to support strategy execution and ensure ability to
deliver our targeted results, we will need to make further
adjustments to the internal structure of the business and recruit
additional personnel within sales, quality, and regulatory areas.
Additional staffing costs mean that, whilst we expect sales to
continue to grow positively in 2024, the additional investment will
negatively impact profitability in 2024 and 2025 but will form a
much stronger platform for delivering growth and shareholder value
in the medium and longer term.
We will continue to work with Aquis
and explore opportunities within other markets, including AIM, to
increase liquidity in the ProBiotix shares.
The Company sees 2024 as a year of
opportunity with a potential for accelerated growth whilst in
parallel building the Company team to support the structure to
drive continuation of growth.
The scale of the market opportunity
in probiotics and cardiometabolic health, the proven efficacy of
our products, the substantial scope for expansion of our range and
geography, the quality and experience of our management team and
organisation, the clarity and distinctiveness of our future
strategy, all allow us to look to the future with confidence and
enthusiasm.
A
Reynolds
Chairman
26
June 2024
S
Andersen
Director
26
June 2024
Notes to the Financial Statements
1. General
Information
ProBiotix Health plc
is a Public Limited Company
limited by shares incorporated and domiciled in England and Wales. Details of the registered office, the officers and advisers to the Company are presented
on the
company information page
at the start
of this
report. The Company's
offices are at
First Floor Zucchi Suite, Nostell Business Estate,
Wakefield, England, WF4 1AB. The
Company is listed on the AQSE Growth Market .
The principal activity is that of
developing probiotics to tackle cardiovascular disease and other
lifestyle conditions which are affecting growing numbers of people
across the world.
These financial statements present
the results and balances of the Company and its subsidiaries
(together, the ÔGroupÕ) for the year ended 31 December
2023.
2. Accounting
Policies
Statement of
compliance
The consolidated financial
statements of Probiotix Health Plc have been prepared in accordance
with UK adopted international accounting standards (IFRSs), IFRIC
interpretations and the Companies Act 2006 applicable to companies
reporting under IFRS. These are the first financial statements
prepared under UK adopted international accounting
standards.
Basis of
preparation
The financial statements have been
prepared under the historical cost convention. The functional
currency is GBP.
The principal accounting policies
are summarised below. They have all been applied consistently
throughout the period under review.
On 7 February 2022 the Company
acquired 100% of the share capital of Probiotix Limited. At
that time, the Company was a subsidiary of Optibiotix Health plc
and so the acquisition represented a common control transaction
outside the scope of IFRS 3.
Therefore the Board determined that
the most appropriate accounting policy is to apply merger
accounting prospectively from 31 March 2022 being the date of the
Group's IPO on AQSE Growth. The Group consolidated Probiotix
Limited's assets and liabilities at book value at 31 March 2022,
with the difference between the nominal value of shares issued and
net liabilities acquired recorded in a reserve within
equity.
Going concern
The financial statements have been
prepared on the assumption that the Group is a going
concern. When assessing the foreseeable future,
the Directors have looked at the budget for the next 12 months from
the date of this report, the cash at bank available as at the date
of approval of these financial statements and are satisfied that
the group should be able to cover its forecast maintenance costs,
other administrative expenses and its ongoing research and
development expenditure. The Board has performed a stress test of
their cashflow should the projected revenue not materialise as
anticipated. In such an event the Board would actively consider
fundraising and other mitigating actions to ensure the Group
continues as a going concern.
Management have considered its
forecast of the groupÕs cash requirements reflecting contracted and
anticipated future revenue and the resulting net cash outflows.
Management have not seen a material disruption to the business as a
result of the current political crises in Europe. Management
will keep events under constant review, and remedial action will be
taken if the situation demands it.
2. Accounting Policies
(continued)
After making enquiries, the
Directors have a reasonable expectation that the Group has adequate
resources to continue in operational existence for the foreseeable
future. Accordingly, they continue to adopt a going concern basis
in preparing the annual report and financial statements
Standards, amendments
and interpretations effective and adopted in 2023
The accounting policies adopted are
consistent with those of the previous financial year. In addition,
the Group has adopted the new, and amendments to, standards listed
below. These amendments were either not applicable or not material
to the Group or Parent Company.
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International Accounting Standards
(IAS/IFRS)
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Effective date
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Initial Application of IFRS 17 and IFRS 9ÑComparative
Information
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1 January 2023
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Disclosure of Accounting Policies
(Amendments to IAS 1 and IFRS Practice
Statement 2)
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1 January 2023
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Definition of Accounting Estimates
(Amendments to IAS 8)
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1 January 2023
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Deferred Tax related to Assets and
Liabilities arising from a Single Transaction (Amendments to
IAS 12)
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1 January 2023
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International Tax Reform - Pillar Two
Model Rules (Amendments to IAS 12)
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1 January 2023
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New standards and
interpretations not yet adopted
The International Accounting
Standards Board (IASB) has issued the following standards,
amendments and interpretations with an effective date after the
date of these consolidated financial statements. These are
effective for annual reporting periods beginning on or after the
date indicated:
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International Accounting Standards
(IAS/IFRS)
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Effective date
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Classification of liabilities as
current or non-current and non-current liabilities with Covenants -
Amendments to IAS 1
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1 January 2024
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Lease Liability in a Sale and
Leaseback - Amendments to IFRS 16
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1 January 2024
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Supplier Finance Arrangements -
Amendments to IAS 7 and IFRS 7
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1 January 2024
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Lack of exchangeability - Amendments
to IAS 21
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1 January 2025
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The Group is assessing the impact of
these new standards and the GroupÕs financial reporting will be
presented in accordance with these standards from the effective
date.
There are no other IFRSs or IFRIC
interpretations that are not yet effective that would be expected
to have a material impact on the Group.
The Directors anticipate that the
adoption of these standards and the interpretations in future
period will have no material impact on the financial statements of
the company.
Basis of consolidation
The consolidated financial
statements incorporate the financial statements of the Company and
entities controlled by the Company (its subsidiaries) made up to 31
December each year. The group controls an investee when
it is exposed, or has rights, to variable returns from its
involvement with the investee and has the ability to affect those
returns through its power over the investee.
The results of subsidiaries acquired
or disposed of during the year are included in the consolidated
statement of comprehensive income from the effective date of
acquisition or up to the effective date of disposal, as
appropriate.
Where necessary, adjustments are
made to the financial statements of subsidiaries to bring their
accounting policies into line with those used by other members of
the Group.
All intra-group transactions,
balances, income and expenses are eliminated on
consolidation.
Changes in the GroupÕs ownership
interests in subsidiaries that do not result in the Group losing
control over the subsidiaries are accounted for as equity
transactions. The carrying amounts of the GroupÕs interests and the
non-controlling interests are adjusted to reflect the changes in
their relative interests in the subsidiaries. Any difference
between the amount by which the non-controlling interests are
adjusted and the fair value of the consideration paid or received
is recognised directly in equity and attributed to owners of the
Company.
When the Group loses control of a
subsidiary, the profit or loss on disposal is calculated as the
difference between (i) the aggregate of the fair value of the
consideration received and the fair value of any retained interest
and (ii) the previous carrying amount of the assets (including
goodwill), and liabilities of the subsidiary and any
non-controlling interests. Where certain assets of the subsidiary
are measured at revalued amounts or fair values and the related
cumulative gain or loss has been recognised in other comprehensive
income and accumulated in equity, the amounts previously recognised
in other comprehensive income and accumulated in equity are
accounted for as if the Company had directly disposed of the
related assets (i.e. reclassified to profit or loss or transferred
directly to retained earnings).
The fair value of any investment
retained in the former subsidiary at the date when control is lost
is regarded as the fair value on initial recognition for subsequent
accounting under IFRS 9 ÒFinancial Instruments: Recognition
and MeasurementÓ or, when applicable, the cost on initial
recognition of an investment in an associate or a jointly
controlled entity.
2. Accounting Policies
(continued)
2.1
Business combinations
Subsidiaries are all entities which the Group has
control. The subsidiary consolidated in these Group accounts was
acquired via group re-organisation and as such merger accounting
principles have been applied. The subsidiaryÕs results are
consoidated for the period from the date the company took control
of it.
This is a business combination involving entities
under common control Therefore, the assets and liabilities of
Probiotix Limited have been recognised and measured in these
consolidated financial statements at their pre combination carrying
values.
The retained earnings and other equity balances
recognised in these consolidated financial statements are the
retained earnings and other equity balances of the Company and
subsidiary. The equity structure appearing in these consolidated
financial statements (the number and the type of equity instruments
issued) reflect the equity structure of the Company including
equity instruments issued by the Company to affect the
consolidation.
The difference between consideration given and net
assets of PL at the date of acquisition is included in a Group
reorganisation reserve. Inter-company transactions, balances and
unrealised gains on transactions between Group companies are
eliminated during the consolidation process.
2.2
Revenue recognition
Revenue is measured at the fair
value of sales of goods and services less returns and sales
taxes. The Group has analysed its business activities and
applied the five-step model prescribed by IFRS 15 to each material
line of business, as outlined below:
2.2.1 Sale of products
The contract to provide a product is
established when the customer places a purchase order. The
performance obligation is to provide the product requested by an
agreed date, and the transaction price is the value of the product
as stated in our order acknowledgement. The performance
obligation is typically met when the product is made available for
collection by the customerso revenue is primarily recognised for
each product when notification of availability is communicated to
the customer. In some limited situations when the product is
complete but the customer is unable to take delivery the
performance obligation is met when the customer formally accepts
transfer of risk and control even though the product has not been
dispatched.
2.2.2 License arrangements
Revenue is recognised when the
customer obtains control of the rights to use the IP. The
performance obligations are considered to be distinct from any
ongoing distribution arrangements which are treated in line with
sales of products.
2.
Accounting Policies (continued)
2.3
Investments
Investments in subsidiaries and
joint ventures are stated at cost less, where appropriate,
provisions for impairment. The Company tests the investment
balances for impairment annually or when there are indicators of
impairment
2.4
Taxation
Income tax expense represents the sum of the tax currently payable
and deferred tax.
(i) Current tax
Current taxes are based on the results shown in the financial
statements and are calculated according to local tax rules using
tax rates enacted or substantially enacted by the statement of
financial position date.
Income tax is recognised in the income statement or in equity if it
relates to items that are recognised in the same or a different
period, directly in equity.
Current tax assets and liabilities for the current and prior
periods are measured at the amount expected to be recovered from or
paid to the taxation authorities.
(ii) Deferred tax
Deferred tax is provided, using the liability method, on temporary
differences at the statement of financial position date between the
tax base of assets and liabilities and their carrying amounts for
financial reporting purposes.
Deferred tax liabilities are recognised for all taxable temporary
differences.
Deferred tax assets are recognised for all deductible temporary
differences, carry forward of unused tax assets and unused tax
losses, to the extent that it is probable that taxable profit
will
be available against which the deductible temporary differenced and
the carrying forward or unused tax assets and unused tax losses can
be utilised.
The carrying amount of deferred tax assets is reviewed at each
balance sheet date and reduced to the extent that it is no longer
probable that sufficient taxable profit will be available to allow
all or part of the deferred tax assets to be utilised. Conversely,
previously unrecognised deferred tax assets are recognised to the
extent that it is probable that sufficient taxable profit that
sufficient taxable profit will be available to allow all or part of
the deferred tax asset to be utilised.
Deferred tax assets and liabilities are measured at the tax rates
that are expected to apply to the year when the asset is realised
or the liability is settled, based on the tax rates and tax laws
that have been enacted or substantively enacted at the balance
sheet date.
2.5
Financial instruments
Financial assets and financial liabilities are recognised when the
group becomes a party to the contractual provisions of the
instrument.
Loans and receivables are
initially measured at fair value and are subsequently measured at
amortised cost using the effective interest rate method.
2. Accounting Policies
(continued)
Trade receivables are initially
measured at fair value and are subsequently measured at amortised
cost less appropriate provisions for estimated irrecoverable
amounts. Such provisions are recognised in the statement of
income.
Cash and cash equivalents comprise cash in hand and demand deposits and other short-term
highly liquid investments with maturities of three months or less
at inception that are readily convertible to a known amount of cash
and are subject to an insignificant risk of changes in
value.
Trade payables are not
interest-bearing and are initially valued at their fair value and
are subsequently measured at amortised cost.
2.6
Equity instruments are recorded at
fair value, being the proceeds received, net of direct issue
costs.
2.7
Share Capital - Ordinary shares are
classified as equity. Incremental costs directly attributable to
the issue of new shares or options are shown in equity as a
deduction, net of taxation, from the proceeds.
2.8
Inventory
Inventories are stated at the lower
of cost and net realisable value. Cost is determined using the
first-in, first-out (FIFO) method. Net realisable value is the
estimated selling price in the ordinary course of business, less
applicable variable selling expenses.
2. Accounting Policies
(continued)
2.9
Impairment of non-financial assets
At each statement of financial
position date, the Group reviews the carrying amounts of its
investments to determine whether there is any indication that those
assets have suffered an impairment loss. If any such indication
exists, the recoverable amount of the asset is estimated in order
to determine the extent of the impairment loss (if any). Where the
asset does not generate cash flows that are independent from other
assets, the group estimates the recoverable amount of the
cash-generating unit to which the asset belongs. An intangible
asset with an indefinite useful life is tested for impairment
annually and whenever there is an indication that the asset may be
impaired.
Recoverable amount is the higher of
fair value less costs to sell and value in use. In assessing value
in use, the estimated future cash flows are discounted to their
present value using a pre-tax discount rate that reflects current
market assessments of the time value of money and the risks
specific to the asset for which the estimates of future cash flows
have not been adjusted.
If the recoverable amount of an
asset (or cash-generating unit) is estimated to be less than its
carrying amount, the carrying amount of the asset (cash-generating
unit) is reduced to its recoverable amount. An impairment loss is
recognised as an expense immediately, unless the relevant asset is
carried at a re-valued amount, in which case the impairment loss is
treated as a revaluation decrease.
Where an impairment loss
subsequently reverses, the carrying amount of the asset
(cash-generating unit) is increased to the revised estimate of its
recoverable amount, but so that the increased carrying amount does
not exceed the carrying amount that would have been determined had
no impairment loss been recognised for the asset (cash-generating
unit) in prior years. A reversal of an impairment loss is
recognised as income immediately, unless the relevant asset is
carried at a revalued amount, in which case the reversal of the
impairment loss is treated as a revaluation increase.
2.10 Capital management
Capital is made up of stated capital, premium, other reserves and
retained earnings. The objective of the GroupÕs capital management
is to ensure that it maintains strong credit ratings and capital
ratios. This will ensure that the business is correctly supported
and shareholder value is maximised.
The
Group manages its capital structure through adjustments that are
dependent on economic conditions. In order to maintain or
adjust the capital structure, the Company may choose to issue new
share capital to shareholders. There were no changes to the
objectives, policies or processes during the period ended 31
December 2023.
2. Accounting Policies
(continued)
2.11 Share-based compensation
The fair value of the employee and
suppliers services received in exchange for the grant of the
options is recognised as an expense. The total amount to be
expensed over the vesting year is determined by reference to the
fair value of the options granted, excluding the impact of any
non-market vesting conditions (for example, profitability and sales
growth targets). Non-market vesting conditions are included in
assumptions about the number of options that are expected to vest.
At each statement of financial position date, the entity revises
its estimates of the number of options that are expected to vest.
It recognises the
impact of the revision to original estimates, if any, in the income
statement, with a corresponding adjustment to equity.
The proceeds received net of any
directly attributable transaction costs are credited to share
capital (nominal value) and share premium when the options are
exercised.
The fair value of share-based
payments recognised in the income statement is measured by use of
the Black Scholes model, which takes into account conditions
attached to the vesting and exercise of the equity instruments. The
expected life used in the model is adjusted; based on managementÕs
best estimate, for the effects of non-transferability, exercise
restrictions and behavioural considerations. The share price
volatility percentage factor used in the calculation is based on
managementÕs best estimate of future share price behaviour and is
selected based on past experience, future expectations and
benchmarked against peer companies in the industry.
2.12 Intangibles Ð Patents and Trademarks
Separately acquired patents are
shown at historical cost. Patents have a finite useful life and are
carried at cost less accumulated amortisation. Amortisation is
calculated using the straight line method to allocate the cost of
the patents over their estimated useful life of ten years once the
patents have been granted.
2.13 Research and
Development
Research expenditure is written off
to the statement of comprehensive income in the year in which it is
incurred. Development expenditure is written off in the same way
unless the Directors are satisfied as to the technical, commercial
and financial viability of individual projects. In this situation,
the expenditure is deferred and amortised over the 10 years during
which the Company is expected to benefit.
2.14 Critical accounting
judgments and key sources of estimation
uncertainty
The preparation of the financial
statements requires management to make estimates and assumptions
concerning the future that affect the reported amounts of assets
and liabilities and the disclosure of contingent assets and
liabilities at the dates of the financial statements and the
reported amounts of revenues and expenses during the reporting
period.
2. Accounting Policies
(continued)
The resulting accounting estimates
will, by definition, differ from the related actual
results.
á Share based
payments
The fair value of share based
payments recognised in the income statement is measured by use of
the Black Scholes model, which takes into account conditions
attached to the vesting and exercise of the equity instruments. The
expected life used in the model is adjusted; based on managementÕs
best estimate, for the effects of non-transferability, exercise
restrictions and behavioural
considerations. The share price volatility
percentage factor used in the calculation is based on managementÕs
best estimate of future share price behaviour and is selected based on
past experience, future expectations and benchmarked against peer
companies in the industry.
á Amortisation
Management have estimated that the
useful life of the fair value of the patent development costs that
have been capitalised in line with the recognition criteria of
IAS38 have been estimated to have a useful economic life of 10
years . Research and developments that have been capitalised in
line with the recognition criteria of IAS38 have been estimated to
have a useful economic life of 10 years. These estimates will be
reviewed annually and revised if the useful life is deemed to be
lower based on the trading business or any changes to patent
law.
á
Impairment
reviews
IFRS requires management to
undertake an annual test for impairment of indefinite lived assets
and, for finite lived assets to test for impairment if events or
changes in circumstances indicate that the carrying amount of an
asset may not be recoverable. Impairment testing is an area
involving management judgement, requiring assessment as to whether
the carrying value of assets can be supported by the net present
value of future cash flows derived from such assets using cash flow
projections which have been discounted at an appropriate rate. In
calculating the net present value of the future cash flows, certain
assumptions are required to be made in respect of highly uncertain
matters.
3. Segmental Reporting
In the opinion of the directors, the
Group has one class of business, in three geographical areas being
that of identifying and developing microbial strains, compounds and
formulations for use in the nutraceutical industry. The Group sells
into three highly interconnected markets, all costs assets and
liabilities are derived from the UK location.
Revenue analysed by geographical
market
|
|
Year ended
31 December
2023
|
Period
ended
31 December
2022
|
|
|
£Õ000
|
£Õ000
|
|
UK
|
65
|
43
|
|
US
|
1,008
|
934
|
|
Rest of world
|
600
|
332
|
|
|
|
|
|
|
──────
|
──────
|
|
|
1,673
|
1,309
|
|
|
══════
|
══════
|
During the reporting period one
customer represented £1.0m, (59.8%) of Group revenues.
(2022: one customer generated
£0.921m representing 70% of Group revenues)
4. Employees and Directors
|
|
Year
ended
31 December
2023
|
Period
ended
31 December
2022
|
|
|
£Õ000
|
£Õ000
|
|
Wages and
salaries
|
208
|
106
|
|
DirectorsÕ remuneration
|
436
|
125
|
|
DirectorsÕ fees
|
65
|
187
|
|
Social security costs
|
20
|
25
|
|
Pension costs
|
40
|
14
|
|
|
──────
|
──────
|
|
|
769
|
457
|
|
|
══════
|
══════
|
|
Wages and salaries of £177k
represent a recharge of salaries from Optibiotix Health PLC for
employees who are under employment contracts with Optibiotix and
recharged under a share services agreement.
|
|
|
|
Year ended
31 December
2023
|
Period
ended
31 December
2022
|
|
|
|
No.
|
No.
|
|
|
The average monthly number of
employees during the period was as follows:
|
|
|
|
|
|
|
|
|
|
Group
|
|
|
|
|
Directors
|
5
|
3
|
|
|
|
|
|
|
|
Selling, General and
Administration
|
2
|
2
|
|
|
|
──────
|
──────
|
|
|
|
7
|
5
|
|
|
|
══════
|
══════
|
|
|
Company
|
|
|
|
|
Directors
|
5
|
4
|
|
|
|
──────
|
──────
|
|
|
|
5
|
4
|
|
|
|
══════
|
══════
|
|
|
|
Year ended
31 December
2023
|
Period
ended
31 December
2022
|
|
|
|
£
|
£
|
|
|
DirectorsÕ remuneration
|
501
|
233
|
|
|
DirectorsÕ share based
payments
|
-
|
-
|
|
|
Bonus
|
-
|
70
|
|
|
Pension
|
22
|
9
|
|
|
|
──────
|
──────
|
|
|
Total emoluments
|
523
|
312
|
|
|
|
══════
|
══════
|
|
|
|
|
|
|
|
4. Employees and Directors
(continued)
|
Emoluments paid to the highest paid
director
|
|
|
|
|
|
|
|
Remuneration for qualifying
services
|
238
|
120
|
|
|
|
|
|
Company pension contributions to
defined
|
12
|
3
|
|
|
|
|
|
|
──────
|
──────
|
|
|
250
|
123
|
|
|
══════
|
══════
|
There are no key management
personnel other than the directors of the company.
The number of directors to whom
defined contribution pension benefits accrue is 2. No directors
exercised share options in the period.
DirectorsÕ remuneration
Details of emoluments received by
Directors of the Group for the year ended 31 December 2023 are as
follows:
|
|
Remuneration
|
|
Share based
|
Pension
Costs
|
Total
|
|
|
and fees
|
Bonuses
|
payments
|
|
|
|
|
£Õ000
|
£Õ000
|
£Õ000
|
£Õ000
|
£Õ000
|
|
A Reynolds*
|
30
|
-
|
-
|
-
|
30
|
|
S Andersen*
|
238
|
-
|
-
|
12
|
250
|
|
S P OÕHara*
|
53
|
-
|
-
|
2
|
55
|
|
M Caspani*
|
20
|
-
|
-
|
-
|
20
|
|
M Hvid-Hansen*
|
160
|
-
|
-
|
8
|
168
|
|
Total
|
501
|
-
|
-
|
22
|
523
|
*For
disclosure in relation to directorsÕ fees please refer to Note
18.
Details of emoluments received by
Directors of the Group for the year ended 31 December 2022 are as
follows:
|
|
Remuneration
|
|
Share based
|
Pension
Costs
|
Total
|
|
|
and fees
|
Bonuses
|
payments
|
|
|
|
|
£Õ000
|
£Õ000
|
£Õ000
|
£Õ000
|
£Õ000
|
|
A Reynolds
|
22
|
30
|
-
|
-
|
52
|
|
S P OÕHara
|
90
|
30
|
-
|
3
|
123
|
|
M Caspani
|
15
|
-
|
-
|
-
|
15
|
|
M Hvid-Hansen
|
106
|
10
|
-
|
6
|
122
|
|
Total
|
233
|
70
|
-
|
9
|
312
|
5. Net Finance Income / (Costs)
|
|
Year ended
31 December
2023
|
Period
ended
31 December
2022
|
|
|
£Õ000
|
£Õ000
|
|
Finance Income:
|
|
|
|
Interest on convertible loan notes
waived on conversion
|
-
|
59
|
|
Finance Cost:
|
|
|
|
|
-
|
-
|
|
|
──────
|
──────
|
|
Net Finance Income /
(Costs)
|
-
|
59
|
|
|
══════
|
══════
|
6. Expenses Ð analysis by nature
|
|
Year ended
31 December
2023
|
Period
ended
31 December
2022
|
|
|
|
*restated
|
|
|
£Õ000
|
£Õ000
|
|
|
|
|
|
Research and development
|
31
|
4
|
|
DirectorsÕ fees & remuneration
(Note 4)*
|
523
|
314
|
|
Salaries
|
208
|
106
|
|
Auditor remuneration - audit
fees (Group and Company accounts
|
38
|
35
|
|
Brokers & Advisors
|
216
|
123
|
|
Listing costs
|
-
|
166
|
|
Share based payments
|
31
|
18
|
|
Advertising &
marketing
|
132
|
68
|
|
Amortisation
|
53
|
37
|
|
Legal and professional
fees
|
132
|
32
|
|
Insurance
|
13
|
6
|
|
Rent
|
18
|
0
|
|
FX
|
43
|
3
|
|
Printing and stationery
|
26
|
0
|
|
Computer running costs
|
20
|
9
|
|
Travel costs
|
57
|
6
|
|
Other expenses
|
93
|
92
|
|
|
──────
|
──────
|
|
Total administrative
expenses
|
1,634
|
1,019
|
|
|
══════
|
══════
|
7.
Corporation Tax
|
|
Year ended
31 December
2023
|
Period
ended
31 December
2022
|
|
|
£Õ000
|
£Õ000
|
|
|
|
|
|
Deferred tax movement
|
(14)
|
(12)
|
|
Corporate tax credits
|
-
|
-
|
|
|
──────
|
──────
|
|
Total taxation
|
(14)
|
(12)
|
|
|
══════
|
══════
|
Analysis of tax expense
No
liability to UK corporation tax arose on ordinary activities for
the year ended 31 December 2023 nor for the period ended 31
December 2022.
|
|
Year ended
31 December
2023
|
Period
ended
31 December
2022
|
|
|
£Õ000
|
£Õ000
|
|
|
|
|
|
Profit (Loss) on ordinary activities
before income tax
|
762
|
(203)
|
|
|
═══════
|
═══════
|
|
|
|
|
|
Loss on ordinary activities
multiplied by the effective rate of corporation tax in UK of 23.5%
(2022:19%)
|
(179)
|
(39)
|
|
|
|
|
|
Effects of:
|
|
|
|
Disallowables
|
8
|
303
|
|
Income not taxable
|
-
|
(265)
|
|
Amortisation
|
12
|
9
|
|
Losses utilised
|
(16)
|
(66)
|
|
Unused tax losses carried
forward
|
175
|
58
|
|
|
──────
|
──────
|
|
Tax credit
|
-
|
-
|
|
|
══════
|
══════
|
|
|
|
|
The Group has estimated losses of
£0.94m (2022: £0.28m) which can be carried forward to be utilised
against future profits.
The tax losses have resulted in a
deferred tax asset at 25% of approximately £0.24m (2022: £0.07m)
which has not been recognized as it is uncertain whether future
taxable profits will be sufficient to utilise the
losses.
8. Earnings per share
Basic
earnings per share is calculated by dividing the earnings
attributable shareholders by the weighted average number of
ordinary shares outstanding during the period.
Reconciliations are set out below:
|
Basic and diluted
EPS
|
Earnings
|
2023
Weighted
average
Number of
shares
|
Profit
per-share
|
|
|
£Õ000
|
No.
|
Pence
|
|
|
|
|
|
|
Basic EPS
|
(747)
|
121,666,666
|
(0.61)
|
|
Diluted EPS
|
(747)
|
121,666,666
|
(0.61)
|
|
|
══════
|
════════
|
══════
|
|
|
|
|
|
|
|
Earnings
|
2022
*restated
Weighted
average
Number of shares
|
Profit
per-share
|
|
|
£Õ000
|
No.
|
Pence
|
|
|
|
|
|
|
Basic EPS
|
(233)
|
90,398,559
|
(0.26)
|
|
Diluted EPS
|
(233)
|
90,398,559
|
(0.26)
|
|
|
══════
|
════════
|
══════
|
As at 31 December 2023 there were
6,500,000 (2022: 6,500,000) outstanding share options. These are
non-dilutive due to the losses incurred in the year.
9. Intangible assets
|
the
|
Development Costs and
Patents
|
|
|
£Õ000
|
|
Cost
|
|
|
At 4 November 2021
|
|
|
Acquired in Probiotix Ltd
acquisition
|
475
|
|
Additions
|
53
|
|
Disposals
|
-
|
|
|
───────
|
|
At 31 December 2022
|
528
|
|
Additions
|
-
|
|
Disposals
|
-
|
|
Impairment
|
(4)
|
|
|
───────
|
|
At 31 December 2023
|
524
|
|
|
═══════
|
|
|
|
|
Amortisation
|
|
|
At 4 November 2021
|
-
|
|
Acquired in Probiotix Ltd
acquisition
|
133
|
|
Amortisation charge for the
year
|
37
|
|
|
───────
|
|
At 31 December 2022
|
170
|
|
Amortisation charge for the
year
|
53
|
|
Amortisation eliminated on
impairment
|
=-
|
|
|
───────
|
|
At 31 December 2023
|
223
|
|
|
═══════
|
|
|
|
|
Carrying amount
|
|
|
At 31 December 2023
|
301
|
|
At 31 December 2022
|
358
|
|
|
═══════
|
All intangible assets relate to the
group's principal activities.
The company had no intangible
assets
10. Investments
|
|
2023
|
2022
|
|
|
£Õ000
|
£Õ000
|
|
Investments
|
|
|
|
At the beginning of the
period
|
50
|
-
|
|
|
|
|
|
Additions
|
4
|
50
|
|
|
|
|
|
|
|
|
|
At 31 December
|
54
|
50
|
As at 31 December 2023 the Company
directly held the following subsidiaries:
|
Name
of company
|
Nature of
Business
|
Active /
Dormant
|
Country of incorporation
and
place of business
|
Proportion of
equity interest
|
|
|
|
|
|
|
|
Probiotix Limited
|
Health Foods
|
Active
|
United Kingdom
|
100% of
ordinary shares
|
|
|
|
|
|
|
|
Probiotix Health Denmark
Aps
|
Health Foods
|
Active
|
Denmark
|
100% of
ordinary shares
|
|
|
|
|
|
|
The registered office of Probiotix
Limited is the same as the company.
Probiotix Denmark registered office
is Transformervej 14 2860 S¿borg, Denmark
The Company acquired its 100%
interest in Probiotix Limited in the period by way of a share for
share exchange
Probiotix Denmark APS was
incorporated during the year.
11. Inventories
|
|
Group
|
Company
|
|
|
2023
|
2022
|
2023
|
2022
|
|
|
£Õ000
|
£Õ000
|
£
|
£
|
|
Finished goods
|
103
|
11
|
-
|
-
|
|
Work in progress
|
-
|
38
|
-
|
-
|
|
|
───────
|
───────
|
───────
|
───────
|
|
Finished goods
|
103
|
49
|
-
|
-
|
|
|
══════
|
══════
|
══════
|
══════
|
|
|
|
|
|
|
During the period £0.801m (2022: £0.570m) has been expensed to
the income statement.
12. Trade and other Receivables
|
|
|
|
|
|
Group
|
Company
|
|
|
2023
|
2022
|
2023
|
2022
|
|
|
£Õ000
|
£Õ000
|
£Õ000
|
£Õ000
|
|
|
|
|
|
|
|
Accounts receivable
|
203
|
397
|
-
|
-
|
|
Other receivables
|
50
|
90
|
70
|
70
|
|
Prepayments
|
13
|
9
|
8
|
9
|
|
|
─────
|
─────
|
─────
|
─────
|
|
|
266
|
496
|
78
|
79
|
|
|
══════
|
══════
|
══════
|
══════
|
See note 21 in respect of the
group's credit risk assessment.
13. Cash and Cash Equivalents
|
|
Group
|
Company
|
|
|
2023
|
2022
|
2023
|
2022
|
|
|
£Õ000
|
£Õ000
|
£Õ000
|
£Õ000
|
|
|
|
|
|
|
|
Cash and bank balances
|
1,502
|
1,740
|
473
|
1,449
|
|
|
══════
|
══════
|
══════
|
══════
|
14. Called Up Share Capital
|
Issued share capital
comprises:
|
2023
£
|
2022
£
|
|
|
|
|
|
Ordinary shares of 0.0005p each Ð
121,666,666 (2022: 121,666,666)
|
60,833
|
60,833
|
|
|
──────
|
──────
|
|
|
60,833
|
60,833
|
|
|
══════
|
══════
|
On 4 November 2021 the Company was
incorporated with 1 share of £1
On 7 February 2022 the £1 share
capital was converted into 2,000 Ordinary shares of £0.0005
each.
On 4 March 2022 99,998,000 Ordinary
shares of £0.0005 were issued to acquire the whole share capital of
Probiotix Limited.
On 31 March 2022 9,761,904 Ordinary
shares of £0.0005 were issued in settlement of convertible loan
notes which automatically converted to shares on IPO at a
conversion rate based on 50% of the IPO price.
On 31 March 2022 11,904,762 Ordinary
shares of £0.0005 were used at 21p a share in respect of a placing
and subscription.
15. Reserves
Share capital is the amount
subscribed for shares at nominal value. Share premium represents
amounts subscribed for share capital in excess of nominal value,
net of expenses.
Group reorganisation reserve arises
from the 100% acquisition of ProBiotix Limited on 31 March 2022
whereby the excess of the nominal value of the issued ordinary
share capital issued over the net liabilities acquired is
transferred to this reserve.
At 31 March 2022 Probiotix Health
Plc investment in Probiotix Limited was £50k and the net
liabilities acquired were £995K, resulting in the recognition of a
group reorganisation reserve of £945k.
Retained earnings represents the
cumulative profits and losses of the group attributable to the
owners of the company.
Share based payment reserve
represents the cumulative amounts charged in respect of unsettled
options issued.
No dividends are proposed in respect
of the period
16.
Trade and other payables
|
Current:
|
|
|
|
|
Group
|
Company
|
|
|
2023
|
2022
|
2023
|
2022
|
|
|
£Õ000
|
£Õ000
|
£Õ000
|
£Õ000
|
|
|
|
|
|
|
|
Accounts Payable
|
466
|
179
|
33
|
4
|
|
- Accrued
expenses
|
66
|
75
|
49
|
15
|
|
- Other
payables
|
34
|
53
|
-
|
23
|
|
-
|
───────
|
───────
|
───────
|
───────
|
|
Total trade and other
payables
|
566
|
307
|
82
|
42
|
|
|
══════
|
══════
|
══════
|
══════
|
All payables are due within 12
months.
17. Deferred Tax
Deferred tax is provided, using the
liability method, on temporary differences at the statement of
financial position date between the tax base of assets and
liabilities and their carrying amounts for financial reporting
purposes.
Deferred tax is calculated in full
on temporary differences under the liability method using a tax
rate of 25% (2022: 25%).
The movement on the deferred tax
account is as shown below:
|
|
2023
|
2022
|
|
|
£Õ000
|
£Õ000
|
|
|
|
|
|
At 31 December
|
89
|
-
|
|
Acquired in common control
transaction
|
-
|
78
|
|
Movement in the period
|
(14)
|
11
|
|
|
──────
|
──────
|
|
At 31 December
|
75
|
89
|
|
|
══════
|
══════
|
The deferred tax liability relates
to timing differences in respect of tax treatment of intangible
assets.
Deferred tax assets have not been
recognised in respect of tax losses and other temporary differences
giving rise to deferred tax assets as the directors believe there
is uncertainty whether the assets are recoverables.
18. Related Party Disclosures
Group
During the year to 31 December 2023
£30,000 was paid to Reyco Limited for the services of Adam Reynolds
as Director of ProBiotix Health Plc. The year end balance was
NIL
During the year to 31 December 2023
£20,000 was paid to Marco Caspani for his the services of Marco
Caspani as Director of ProBiotix Health plc. The year end
balance was NIL
During the year to 31 December 2023
£59,799 was invoiced by Optibiotix Health Plc for the services
of Stephen OÕHara as Director of ProBiotix Health Plc.
The year end balance was £15,000
During the year Optibiotix Limited
transactions with Probiotix Limited were as follows:-
¥
£490,786 (2022: £440,663) for salaries and administration
costs;
¥
£67,701, (2022: £60,676) income received on behalf of Probiotix
limited; and
¥
£425,640 (2022: £544,177) repayments received.
There was no interest charged during
the year. The remaining balance of £27,592 was received after the
year end.
During the year to 31 December 2023
the Group purchased LPLDL stock to the value of £607,390, (2022:
£490,001) from Centro Sperimentale del Latte srl, a company
in which Marco Capsani is a director. At 31 December 2023
there was balance owing to Centro Sperimentale del Latte srl of
£232,010, which was paid after the year end.
Company
During the year to 31 December 2023
£167,957 (2022: £126,065) was paid to Balin S.a.g.l for the
services of Mikkel Hvid-Hansen as Director of ProBiotix Health
Plc.
During the year £249,832
(2022:NIL) was paid to Probiotix Denmark Aps for the services
of Steen Andersen as CEO of Probiotix Health Plc. The year end
balance was NIL.
During the year £173,363
(2022:NIL) was paid to Probiotix Denmark Aps for management
fees and operating costs. Of the £173,363 paid during the year ,
£51,185 relates to a part prepayment of fees for the
During the year Probiotix Health PLC
loaned Probiotix limited £539,514, (2022: £1,543,948) of which
£207,735, (2022: £147,837) was repaid. The balance at the 31
December 2023 of £331,779,(2022: £1,396,111) was cancelled.
This does not impact on the consolidated Group accounts.
Director remuneration has been fully
disclosed as per requirements under note 4
19. Ultimate Controlling Party
The
Board consider that there is no overall controlling
party.
20. Share Based payment Transactions
(i) Share options
The Company had introduced a share option
programme to grant share options as an incentive for
employees.
Each share option converts into one
ordinary share of the Company on exercise. No amounts are
paid or payable by the recipient on receipt of the option and the
Company has no legal obligation to repurchase or settle the options
in cash. The options carry neither rights to dividends nor
voting rights prior to the date on which the options are
exercised. Options may be exercised at any time from the date
of vesting to the date of expiry.
The remaining life of all options is
8.25 years.
Movements in the number of share
options outstanding and their related weighted average exercise
prices are as follows:
|
|
Number of
options
|
Average exercise
price
|
|
|
|
2023
|
2022
|
2023
|
2022
|
|
|
No.
|
No.
|
£
|
£
|
|
Outstanding at the beginning of the
period
|
6,500,000
|
|
0.21
|
|
|
- Granted
during the period
|
-
|
6,500,000
|
-
|
0.21
|
|
-
Forfeited/cancelled during the year
|
|
|
|
-
|
|
- Exercised
during the period
|
-
|
|
-
|
-
|
|
-
|
───────
|
───────
|
───────
|
───────
|
|
Outstanding at the end of the
period
|
6,500,000
|
6,500,000
|
0.21
|
0.21
|
|
|
───────
|
───────
|
───────
|
───────
|
|
|
|
|
|
|
Expected volatility is based on a
best estimate for an AIM listed entity. The expected life used in
the model has been adjusted, based on managementÕs best estimate,
for the effects of non-transferability, exercise restrictions and
behavioural considerations.
The fair values of the last share
options issued were derived using the Black Scholes model. The
following assumptions were used in the calculations:
|
Grant date
|
31/03/2022
|
|
Exercise price
|
21p
|
|
Share price at grant date
|
22p
|
|
Risk-free rate
|
1.109%
|
|
Volatility
|
55%
|
|
Expected life
|
10
years
|
|
Fair value
|
14.2p
|
A charge of £31k (2022: £18k) has
been recognised during the year for the share based payments over
the vesting period.
In respect of options which include
market based vesting conditions in respect of revenue and share
price targets, the Board have determined that the value of this
proportion of shares have immaterial value in light of the Group's
results for the 2023 accounting period in which they were
granted.
125,000share options were
exercisable at 31 December 2023.
20. Share Based payment Transactions
(Continued)
(i) Warrants
On 31 March 2022, the Company
executed a warrant instrument to create and issue warrants to
Peterhouse to subscribe for, an aggregate, of 112,857 Ordinary
Shares. The warrants will be exercisable at any time from Admission
for a period of ten years from Admission at the Fundraising
Price.
Movements in the number of share
warrants outstanding and their related weighted average exercise
prices are as follows:
|
|
Number of
warrants
|
Average exercise
price
|
|
|
2023
|
2022
|
2023
|
2022
|
|
|
No.
|
No.
|
£
|
£
|
|
Outstanding at the beginning of the
period
|
112,857
|
-
|
0.21
|
|
|
-
|
|
|
|
|
|
- Granted
during the period
|
-
|
112,857
|
-
|
0.21
|
|
-
|
|
|
|
|
|
-
|
───────
|
───────
|
───────
|
───────
|
|
Outstanding at the end of the
period
|
112,857
|
112,857
|
0.21
|
0.21
|
|
|
───────
|
───────
|
───────
|
───────
|
A charge of £7,900 (2022:
£7,900) has been recognised during the year for the share based
payments over the vesting period.
The warrants were issued to the
company's broker in respect of shares issues on IPO and so the fair
value has been deducted from share premium.
21.
Prior Period Adjustments
During the preparation of the 2023 Financial Statements,
errors in respect of share option charge was identified, therefore,
the Group and the Company has provided a restated Balance Sheet as
at 31 December 2022 in accordance with IAS 8. Principally, the
error identified was that the share option charge had not been
accounted for in the prior period. This resulted in share option
charge being understated in the previous period. The effect of the
restatement on the Group and the Company Balance Sheet for prior
year is to decrease retained earnings by £18k and a corresponding
increase share option reserves by £18k.
22. Financial Risk Management Objectives and
Policies
The
GroupÕs financial instruments comprise cash balances and
receivables and payables that arise directly from its
operations.
The
main risks the Group faces are liquidity risk and capital
risk.
The
Board regularly reviews and agrees policies for managing each of
these risks. The GroupÕs policies for managing these risks are
summarised below and have been applied throughout the period. The
numerical disclosures exclude short-term debtors and their carrying
amount is considered to be a reasonable approximation of their fair
value.
Interest risk
The
Group is not exposed to significant interest rate risk as it has
limited interest bearing liabilities at the year end.
Credit risk
Management have regard to credit exposures when entering into new
contracts and seek to agree settlement terms on all contracts.
Credit exposure is regularly monitored by management and any
overdue debts are followed up as part of the group's credit control
procedures.
Where a debt becomes significantly overdue, management have
regard to credit loss provisions to reflect the existence of
expected credit losses, taking account of forward looking
information as well as the pattern of cash collections for that
category of customer.
On 31
March 2022 as part of the common control transaction the group
acquired £345k of credit-impaired receivables against which full
provision had been made prior to that date.
In
the year to 31 December 2023 £125k of the debt was recovered and
returned to Optibiotix Limited against the provision in their
accounts. No additional credit loss provision has raised after
having regard to cash collections on other receivables.
Liquidity risk
Liquidity risk is the risk that Group will encounter difficulty in
meeting these obligations associated with financial
liabilities.
The
responsibility for liquidity risks management rest with the Board
of Directors, which has established appropriate liquidity risk
management framework for the management of the GroupÕs short term
and long-term funding risks management requirements.
During the period under review, the Group has not utilised any
borrowing facilities.
The
Group manages liquidity risks by maintaining adequate reserves and
reserve borrowing facilities by continuously monitoring forecast
and actual cash flows, and by matching the maturity profiles of
financial assets and liabilities.
Capital risk
The Group's objectives when managing
capital are to safeguard the ability to continue as a going concern
in order to provide returns for shareholders and benefits to other
stakeholders and to maintain an optimal capital structure to reduce
the cost of capital.
22. Post Balance Sheet Events
There
were no post balance sheet events.
The
Company’s audited accounts for the year ended 31 December 2023
contain the following statement from the Company’s
auditors:
Material Uncertainty related to going
concern
We draw attention to note 2 of the financial statements which
indicates that the Board has stress tested the cashflow should the
projected revenue not materialise as anticipated. In such an event
the board would actively consider fundraising and other mitigating
actions to ensure the Group continues as a going concern.. Any
future fundraising would require the agreements and consents from
third parties which are not within the direct control of the
Company and accordingly, this event and condition constitute
material uncertainties that may cast significant doubt on the
Group’s and Parent Company’s ability to continue as a going
concern, and therefore, that the Group and parent Company may be
unable to realise their assets and discharge their liabilities in
the normal course of business.
Our opinion is not modified in respect of these matters.
NOTICE OF ANNUAL GENERAL
MEETING
PROBIOTIX HEALTH PLC
Notice is hereby given that the
Annual General Meeting of OptiBiotix Health PLC (the ÒCompanyÓ)
will be held at the offices of Peterhouse Capital Limited, 3rd
Floor,80 Cheapside,London.EC2V 6EE on 8 August 2024 at 13:30
for the following purposes:
1.
To receive the CompanyÕs Report and Accounts for
the year ended 31 December 2023.
2.
To re-elect Stephen OÕHara , who retires by
rotation, as a Director.
3.
To re-elect Marco Caspani , who retires by
rotation, as a Director.
4.
To re-appoint Gerald Edelman LLP as auditors of
the Company and to authorise the Directors to determine their
remuneration.
Special
Business
To consider and, if thought fit, to
pass the following resolutions as to the resolution numbered 5 as
an Ordinary Resolution and as to the resolutions numbered 6 as a
Special Resolution:
5.
THAT the Directors be and they
are hereby authorised generally and unconditionally for the
purposes of Section 551 of the Companies Act 2006 (the ÒActÓ) to
exercise all powers of the Company to allot shares in the Company
or to grant rights to subscribe for, or to convert any security
into, shares in the Company (such shares and/or rights being
ÒRelevant SecuritiesÓ) up to an aggregate nominal amount of
£20,277.78 being one third of the current issued share
capital, provided that this authority shall, unless renewed, varied
or revoked by the Company, expire on the date being the earlier of
the date 15 months after the passing of this Resolution and the
conclusion of the Annual General Meeting of the Company to be held
in 2025, save that the Company may, before such expiry, make offers
or agreements which would or might require Relevant Securities to
be allotted and the Directors may allot Relevant Securities in
pursuance of such offer or agreement notwithstanding that the
authority conferred by this Resolution has expired.
This authority shall be in
substitution for and shall replace any existing
authority
pursuant to Section 551 of the Act
to the extent not utilised at the date this resolution is
passed.
6.
THAT, subject to and
conditional upon the passing of resolution 8, the Directors be and
they are hereby generally empowered pursuant to Section 570 of the
Act to allot equity securities (as defined in Section 560 of the
Act) for cash pursuant to the authority conferred under Resolution
5 above as if sub-section 561(1) of the Act did not apply to such
allotment, provided that this power shall be limited
to:-
(a)
the allotment of equity securities in
connection with a rights issue or any pre-emptive offer in favour
of holders of ordinary shares in the Company where the equity
securities attributable to the respective interests of such holders
are proportionate (as nearly as maybe) to the respective numbers of
ordinary shares held by them on the record date for such allotment
subject to such exclusions or other arrangements as the Directors
may deem necessary or expedient to deal with fractional
entitlements or any legal or practical difficulties under the laws
of, or the requirements of, any regulatory body or stock exchange
of any overseas territory or otherwise;
(b) the
allotment (otherwise than pursuant to
sub-paragraph (a) above) of equity securities up to an aggregate
nominal value of £18,250 being 30% of the current
issued share capital;
and shall expire on the date being
the earlier of the date 15 months after the passing of this
Resolution and the conclusion of the Annual General Meeting of the
Company to be held in 2025, provided that the Company may before
such expiry make an offer or agreement which would require equity
securities to be allotted in pursuance of such offer or agreement
as if the power conferred hereby had not expired and provided
further that this authority shall be in substitution for and
supersede and revoke any earlier power given to
directors.
|
By Order of the Board
|
Registered Office:
|
|
Steen Andersen
|
First Floor Zucchi Suite, Nostell
Business Estate, Wakefield, England, WF4 1AB
|
|
|
|
|
|
|
|
|
|
|
|
|
28 June 2024
EXPLANATORY NOTES TO THE NOTICE OF ANNUAL GENERAL
MEETING
Notes:
1. A member of the
Company is entitled to appoint a proxy or proxies to attend, speak
and vote at the meeting in his stead. A member may appoint
more than one proxy provided each proxy is appointed to exercise
rights attached to different shares. A member may not appoint more
than one proxy to exercise rights attached to any one share.
A proxy does not need to be a member of the Company.
2. To be effective
Forms of Proxy can be registered as follows:-
¥ by logging on to
www.shareregistrars.uk.com,
clicking on the ÒProxy VoteÓ button and then following the
on-screen instructions;
¥ by post or by hand to Share
Registrars Limited, 3 The Millennium Centre, Crosby Way, Farnham,
Surrey GU9 7XX using the proxy form accompanying this
notice;
¥ in the case of CREST members, by
utilising the CREST electronic proxy appointment service
in
accordance with the procedures set
out in note [5 ] below.
In order for a proxy appointment to be valid the proxy must be
received by Share Registrars Limited by
13:30 on 24 July 2023
3. To change your
proxy instructions simply submit a new proxy appointment using the
methods set out above and in the notes to the Form of Proxy. Note
that the cut-off times for receipt of proxy appointments (see
above) also apply in relation to amended instructions; any amended
proxy appointment received after the relevant cut-off time will be
disregarded.
4. To be entitled
to vote at the meeting (and for the purpose of the determination by
Company of the number of votes they may cast),
members must be entered in the Register of members at 13:30
on 24 July 2023 (Òthe specified timeÓ). If the meeting
is adjourned to a time not more than 48 hours after the specified
time applicable to the original meeting, that time will also apply
for the purpose of determining the entitlement of members to attend
and vote (and for the purpose of determining the number of votes
they may cast) at the adjourned meeting. If however the
meeting is adjourned for a longer period then, to be so entitled,
members must be entered on the CompanyÕs Register of Members at the
time which is not less than 48 hours before the time fixed for the
adjourned meeting or, if the Company gives notice of the adjourned
meeting, at the time specified in that notice.
5. CREST members
who wish to appoint a proxy or proxies through the CREST electronic
proxy appointment service may do so for the General Meeting and any
adjournment(s) thereof by using the procedures described in the
CREST Manual. CREST Personal Members or other CREST sponsored
members, and those CREST members who have appointed a voting
service provider(s) should refer to their CREST sponsor or voting
service provider(s), who will be able to take the appropriate
action on their behalf. In order for a proxy appointment or
instruction made using the CREST service to be valid, the
appropriate CREST message (a ÒCREST Proxy InstructionÓ) must be
properly authenticated in accordance with CRESTCO LimitedÕs
specifications and must contain the information required for such
instructions, as described in the CREST Manual. The message,
regardless of whether it relates to the appointment of a proxy or
to an amendment to the instruction given to a previously appointed
proxy must, in order to be valid, be transmitted so as to be
received by the issuerÕs agent 7RA36 by the latest time(s) for
receipt of proxy appointments specified above. For this purpose,
the time of receipt will be taken to be the time (as determined by
the timestamp applied to the message by the CREST Applications
Host) from which the issuerÕs agent is able to retrieve the message
by enquiry to CREST in the manner prescribed by CREST. After this
time, any change of instructions to proxies appointed through CREST
should be communicated to the appointee through other means.CREST
members and, where applicable, their CREST sponsors or voting
service providers should note that CRESTCo Limited does not make
available special procedures in CREST for any particular messages.
Normal system timings and limitations will therefore apply in
relation to the input of CREST Proxy Instructions. It is the
responsibility of the CREST member concerned totake (or, if the
CREST member is a CREST personal member or sponsored member or has
appointed a voting service provider(s), to procure that his or her
CREST sponsor or voting service provider(s) take(s)) such action as
shall be necessary to ensure that a message is transmitted by means
of CREST by any particular time. In this connection, CREST members
and, where applicable, their CREST sponsors or voting service
providers are referred, in particular, to those sections of the
CREST Manual concerning practical limitations of the CREST system
and timings.The Company may treat as invalid a CREST Proxy
Instruction in the circumstances set out in Regulation 35(5)(a) of
the Uncertificated Securities Regulations 2001.
Resolution 1
The Directors are required by law to
present to the meeting the Audited Accounts and
DirectorsÕ Report for the period
ended 31 December 2023.
Resolutions 2-3
Each of the CompanyÕs Directors
listed in this resolution offer themselves up for re-appointment
under the terms of the CompanyÕs articles of association which
state that each director must offer himself or herself up for
re-appointment every three years.
Resolution 4
The Auditors are required to be
re-appointed at each Annual General Meeting at which
the CompanyÕs Audited Accounts are
presented.
Resolution 5
Under the Act, the Directors may
only allot shares if authorised to do so. Whilst the current
authority has not yet expired, it is customary to grant a new
authority at each Annual General Meeting. Accordingly, this
resolution will be proposed as an ordinary resolution to grant a
new authority to allot or grant rights over up to
£20,277.78 in nominal value of the CompanyÕs unissued share capital. If
given, this authority will expire at the CompanyÕs next annual
general meeting following the date of the resolution. Although the
Directors currently have no present intention of exercising this
authority, passing this resolution will allow the Directors
flexibility to act in the best interests of the CompanyÕs
shareholders when opportunities arise.
Resolution 6
The Directors require additional
authority from the CompanyÕs shareholders to allot shares where
they propose to do so for cash and otherwise than to the CompanyÕs
shareholders pro rata to their holdings. This resolution will give
the Directors power to issue new ordinary shares for cash other
than to the CompanyÕs shareholders on a pro rata basis
(i) by way of a
rights or similar issue or
(ii) with a nominal value of up to
£18,250. This
resolution will be proposed as a special resolution.