TIDMFBDU
RNS Number : 2067O
Flying Brands Limited
17 August 2017
17 August 2017
Flying Brands Limited (the "Company" or the "Group")
Half Yearly Report (Unaudited)
For the Period Ended 30 June 2017
Flying Brands announces today its preliminary financial results
for the six months ended 30 June 2017.
For further information, please contact:
Flying Brands Limited
Mr Trevor Brown/Dr Qu
Li/Mr Vinod Kaushal 0207 469 0930
Peterhouse Corporate
Finance Limited
Mr Duncan Vasey/Ms.
Heena Karani 0207 220 9797
Chief Executive's Statement
It is with pleasure that I present the half yearly financial
statements to shareholders for the six months ended 30 June
2017.
During this period your board completed the acquisition of Stone
Checker Software which culminated in the re-admission of Flying
Brands shares to the market on the 15 June 2017. The loss for the
year to date reflects the costs of the RTO process combined with
the ordinary expenses of maintaining and administering the
Group.
Since I last updated shareholders on the 11th of July, further
progress has been made.
Strategy
Clinical research costs have been reduced compared with the
budget, by working collaboratively with our academic partners.
Following a research agreement with Oxford University Hospitals NHS
Foundation Trust, academic urology researchers will have first
access to the data and be first to publish the novel findings in
clinical and imaging journals, and conference presentations.
Expenditure savings will be redirected into expediting the
regulatory process.
Initial encouraging progress in combination with our increased
focus upon obtaining timely regulatory approval means it has become
unnecessary to seek research sales of our software in the final
quarter of this calendar year. The executive team will instead
redeploy its resources into activities required to ensure a
successful commercial launch immediately after we obtain regulatory
approval of the finished product.
Stone Checker Software development
We expect to receive the first software prototype from the
specialist medical imaging software company in North America for
internal review and evaluation in September 2017. The regulatory
work to achieve our anticipated target dates for CE mark and FDA
approval will commence as soon as we have successfully evaluated
the prototype. With the possibility of further applications being
identified, we hope to be able to offer our software package like a
tool-box - providing the reader (e.g. urologist / radiologist) with
a variety of outputs (suite of tools/products) which the reader can
apply to the appropriate clinical situation, for example:
-- Successful evaluation of the kidney stone lithotripsy
treatment - based on the data predominantly obtained in
collaboration with Oxford University Hospital
-- Displaying information for variables such as stone volume and
Hounsfield Unit density which are widely accepted to have clinical
importance but which are only calculable using inconvenient manual
processes and therefore not typically available to clinicians.
-- Kidney-stone composition analysis. Preliminary results from a
research study comprising of 50 kidney stones from Peking Union
Medical College Hospital (PUMCH), Beijing, the leading university
hospital in China demonstrates another novel application for the
use of CT texture analysis to differentiate two major types of
stones based on their composition i.e. uric acid (UA) versus
non-uric acid (non-UA) urinary stones. These results will be
presented later in the year at RSNA, the largest radiology congress
in the world.
StonePrevent
Progress continues with the StonePrevent product, in particular
we have this month commenced potentially important discussions with
a single metabolic screening laboratory with global reach to
explore the feasibility of outsourcing the technical metabolic
screening processes to a single provider. In a collaborative
process, the StonePrevent product would add material value to the
technical work of this global testing house while Stone Checker
Software would add significant healthcare experience and
expertise.
Outlook
The Stone Checker Software team comprises people with rare
expertise who are excited by and think creatively about, the
advancement of medical science via technological innovation. I am
confident that there will be much to report to shareholders as
developments unfold.
Trevor Brown
Chief Executive
Strategic report and business review
To the members of Flying Brands Limited
Cautionary statement
This business review has been prepared solely to provide
additional information to shareholders to assess the Company's
strategies and the potential for those strategies to succeed.
The business review contains certain forward looking statements.
These statements are made by the Directors in good faith based on
the information available to them up to the time of their approval
of this report and such statements should be treated with caution
due to the inherent uncertainties, including both economic and
business risk factors, underlying any such forward looking
information.
This business review has been prepared for the Group as a whole
and therefore gives greater emphasis to those matters which are
significant to Flying Brands Limited and its subsidiary
undertakings when viewed as a whole.
The Group's future business model
Following the acquisition of Stone Checker Software Limited
("Stone Checker") the Group's business model is now solely focused
on the development of the software and distributing the products to
the global market. Until suitable products are ready for market,
the Board will continue to maintain a low cost base and ensure as
much of the resources available to the Group are expensed directly
on the testing, development and marketing of the products.
Review of the Group's progress
Whilst the Board would have hoped to have completed the
acquisition of Stone Checker earlier they were still able to
execute prior to this period end. Development started imminently
and they believe that any time lost on completing the transaction
can be made up in the development stage and acquiring the relevant
regulatory approvals.
Results for the 2017 interim financial period
A summary of the key financial results is set out in the table
below:
30.6.2017
GBP'000
--------------------- ----------
Revenue -
Operating expenses (192)
--------------------- ----------
Operating loss (192)
Finance costs -
--------------------- ----------
Loss before tax (192)
Taxation -
Loss for the period (192)
Interest
The net interest cost for the Group for the period was GBPnil
(2016: GBP0.01m).
Loss before tax
Loss before tax for the period was GBP0.2m (2016: GBP0.1m).
Taxation
Taxation charge was GBPnil for the period (2016: GBPnil).
Earnings per share
Basic and diluted earnings per share for the period were 0.62p
loss (2016: 0.44p loss).
Financial position
The Group's balance sheet as at 30 June 2017 can be summarised
as set out in the table below:
Assets Liabilities Net assets
GBP'm GBP'm GBP'm
GBP'000 GBP'000 GBP'000
-------------------------------- -------- ------------ -----------
Non-current assets 278 - 278
Current assets and liabilities 502 (93) 409
Loans and provisions - (375) (375)
Total as at 30 June 2017 780 (468) 312
-------------------------------- -------- ------------ -----------
Total as at 31 December
2016 80 (427) (347)
-------------------------------- -------- ------------ -----------
Cash flow
Net cash inflow for 2017 was GBP0.4m (2016: GBP0.1m
outflow).
This inflow reflects the net placing for the Group during the
period. The overall movement in creditors was GBP0.04m (2015:
GBP0.1m decrease).
Consolidated Income Statement
Interim period ended 30 June 2017
(Audited)
Half Full Half
year year year
ended ended ended
30.06.17 31.12.2016 30.6.2016
GBP'000 GBP'000 GBP'000
Revenue - - -
Cost of sales - - -
-------------------------- --------- ----------- ----------
Gross profit - - -
Operating expenses (192) (272) (125)
-------------------------- --------- ----------- ----------
Operating loss (192) (272) (125)
Net finance expense - (31) (12)
Loss before tax (192) (303) (137)
Taxation - -
-------------------------- --------- ----------- ----------
Loss for the period (192) (303) (137)
Loss attributable to the
Group (192) (303) (137)
-------------------------- --------- ----------- ----------
Loss per share expressed
in pence per share
From continuing and total
operations:
Basic & diluted (0.62) (1.03) (0.44)
Consolidated Statement of Comprehensive Income
26 weeks ended 30 June 2016
(Audited)
Half year Full year Half year
ended ended ended
30.06.17 31.12.2016 30.6.2016
GBP'000 GBP'000 GBP'000
-------------------------------------- --------- ---------- ---------
Loss profit for the period (192) (303) (137)
Unclaimed dividends - - -
Total comprehensive loss attributable
to the Group (192) (303) (137)
Consolidated Balance Sheet
As at 30 June 2017
(Audited)
30.06.17 31.12.2016 30.6.2016
GBP'000 GBP'000 GBP'000
Assets
Non-current assets
Goodwill 243 - -
Development costs 35 - -
Total non-current assets 278 - -
Current assets
Trade and other receivables 4 14 4
Cash 498 66 196
----------------------------- ----------- ------------ -----------
Total current assets 502 80 200
Current liabilities
Trade and other payables (93) (52) (26)
Net current assets 409 28 174
Non - current liabilities
Loan (375) (375) (356)
Net Assets/(liabilities) 312 (347) (182)
Share capital 590 310 310
Share premium 18,633 18,062 18,062
Capital redemption reserve 22 22 22
Treasury shares (840) (840) (840)
Convertible loan equity
reserve 53 53 53
Warrant reserve 13 13 13
Retained earnings (18,159) (17,967) (17,802)
Total equity attributable
to equity holders of
the parent 312 (347) (182)
----------------------------- ----------- ------------ -----------
Consolidated statement of changes in equity
26 weeks ended 30 June 2016
Convertible
loan
Capital note
Share Share redemption Treasury / warrant Retained Total
capital premium reserve shares reserve earnings equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------------------- -------- -------- ----------- -------- ------------- --------- -------
Balance at 1
January 2016 310 18,062 22 (840) 66 (17,664) (44)
Loss for the
period - - - - - (303) (303)
Total comprehensive
loss - - - - - (303) (303)
-------------------- -------- -------- ----------- -------- ------------- --------- -------
Balance at 31
December 2016 310 18,062 22 (840) 66 (17,967) (347)
Loss for the
period - - - - (192) (192)
Total comprehensive
loss - - - - - (192) (192)
-------------------- -------- -------- ----------- -------- ------------- --------- -------
Shares issued
in period 280 571 - - - - 851
Balance at 30
June 2017 590 18,633 22 (840) 66 (18,159) (312)
Consolidated Cash Flow Statement
26 weeks ended 30 June 2016
(Audited)
Half year Full year Half year
ended ended ended
30.06.17 31.12.16 30.06.16
GBP'000 GBP'000 GBP'000
--------------------------------------------- --------- ---------- ---------
Loss for the period (192) (303) (137)
Adjustment for:
(Increase)/decrease in receivables 10 (27) -
Increase/(decrease) in payables 41 74 -
Net finance expenditure - - 12
Net cash used in operating activities (141) (256) (125)
Cash flows from investing activities
Acquisition of subsidiaries -
Net cash from/(used in) investing activities - - -
--------------------------------------------- --------- ---------- ---------
Cash flows from financing activities
New loans raised - - -
Convertible loan notes issued - - -
Shares issued 573 - -
Repayment of borrowings - - -
Conversion of convertible loan notes - - -
Net cash from/(used in) financing activities 573 - -
--------------------------------------------- --------- ---------- ---------
Net increase/(decrease) in cash and
cash equivalents 432 (256) (126)
--------------------------------------------- --------- ---------- ---------
Cash and cash equivalents brought forward 66 322 322
--------------------------------------------- --------- ---------- ---------
Cash and cash equivalents carried forward 498 66 196
--------------------------------------------- --------- ---------- ---------
Summary of significant accounting policies
The principal accounting policies adopted in the preparation of
these financial results are set out below. These policies have been
consistently applied to all financial periods presented, unless
otherwise stated.
Basis of preparation and going concern basis
Flying Brands Limited (the Company) is a limited liability
company incorporated and domiciled in Jersey. The consolidated
financial results of the Company comprise the Company and its
subsidiaries (together referred to as the Group). The accounting
policies of the Company are the same as for the Group except where
separately disclosed.
These consolidated financial results have been prepared and
approved by the Directors in accordance with International
Financial Reporting Standards as adopted by the European Union
(adopted IFRS).
The Group's business activities, together with the factors
likely to affect its future development, performance and position
are set out in this review. The financial position of the Group,
its cash flows and liquidity position are described in this
business review. In addition, the below notes to the financial
results include the Group's objectives, policies and processes for
managing its capital; its financial risk management objectives;
details of its financial instruments; and its exposure to credit
risk and liquidity risk. As highlighted in below, the Group meets
its day to day working capital requirements through its on-going
cash flows.
Basis of consolidation
Subsidiaries are all entities over which the Group has the power
to govern the financial and operating policies so as to obtain
benefits from its activities generally accompanying a shareholding
of more than one half of the voting rights.
The purchase method of accounting is used to account for the
acquisition of subsidiaries by the Group. The cost of an
acquisition is measured as the fair value of the assets given,
equity instruments issued and liabilities incurred or assumed at
the date of exchange, plus costs directly attributable to the
acquisition. Identifiable assets acquired and liabilities and
contingent liabilities assumed in a business combination are
measured initially at their fair value at the acquisition date,
irrespective of the extent of any minority interest. The excess of
the cost of acquisition over the fair value of the Group's share of
the identifiable assets, liabilities and contingent liabilities
acquired is recorded as goodwill. The results of the subsidiary
undertakings acquired or disposed of during the period are included
in the Consolidated Income Statement from the date that control
commences until the date control ceases.
Inter-company transactions, balances and unrealised gains on
transactions between Group companies are eliminated. Accounting
policies of subsidiaries have been changed where necessary to
ensure consistency with the policies adopted by the Group.
Segment reporting
The Group is currently a cash shell and the directors believe
that there is no benefit to show any segmental reporting until a
new strategy is undertaken.
Business combinations
Acquisitions of subsidiaries and businesses are accounted for
using the acquisition method. The consideration for each
acquisition is measured at the aggregate of the fair values (at the
date of exchange) of assets given, liabilities incurred or assumed,
and equity instruments issued by the Group in exchange for control
of the acquirer. Acquisition-related costs are recognised in profit
or loss as incurred.
Where applicable, the consideration for the acquisition includes
any asset or liability resulting from a contingent consideration
arrangement, measured at its acquisition-date fair value.
Subsequent changes in such fair values are adjusted against the
cost of acquisition where they qualify as measurement period
adjustments (see below). All other subsequent changes in the fair
value of contingent consideration classified as an asset or
liability are accounted for in accordance with relevant IFRSs.
Changes in the fair value of contingent consideration classified as
equity are not recognised.
Where a business combination is achieved in stages, the Group's
previously-held interests in the acquired entity are remeasured to
fair value at the acquisition date (i.e. the date the Group attains
control) and the resulting gain or loss, if any, is recognised in
profit or loss. Amounts arising from interests in the acquiree
prior to the acquisition date that have previously been recognised
in other comprehensive income are reclassified to profit or loss,
where such treatment would be appropriate if that interest were
disposed of.
The acquirer's identifiable assets, liabilities and contingent
liabilities that meet the conditions for recognition under IFRS
3(2008) are recognised at their fair value at the acquisition date,
except that:
-- deferred tax assets or liabilities and liabilities or assets
related to employee benefit arrangements are recognised and
measured in accordance with IAS 12 Income Taxes and IAS 19 Employee
Benefits respectively;
-- liabilities or equity instruments related to the replacement
by the Group of an acquiree's share-based payment awards are
measured in accordance with IFRS 2 Share-based Payment; and
-- assets (or disposal groups) that are classified as held for
sale in accordance with IFRS 5 Non-current Assets Held for Sale and
Discontinued Operations are measured in accordance with that
Standard.
If the initial accounting for a business combination is
incomplete by the end of the reporting period in which the
combination occurs, the Group reports provisional amounts for the
items for which the accounting is incomplete. Those provisional
amounts are adjusted during the measurement period (see below), or
additional assets or liabilities are recognised, to reflect new
information obtained about facts and circumstances that existed as
of the acquisition date that, if known, would have affected the
amounts recognised as of that date.
The measurement period is the period from the date of
acquisition to the date the Group obtains complete information
about facts and circumstances that existed as of the acquisition
date, and is subject to a maximum of one year.
Impairment
(a) Financial assets
A financial asset is assessed at each reporting date to
determine whether there is any evidence that it is impaired. A
financial asset is considered impaired if objective evidence
indicates that one or more events have had a negative effect on the
estimated future cash flows of that asset. Individual significant
financial assets are tested for impairment on an individual basis.
The remaining financial assets are assessed collectively in groups
that share similar credit risk characteristics. All impairment
losses are recognised in the consolidated income statement.
(b) Non-financial assets
The carrying amounts of the Group's non-financial assets are
reviewed at each reporting date to determine whether there is any
indication of impairment. If any such indication exists, then the
asset's recoverable amount is estimated. For goodwill and
intangible assets that have indefinite lives or that are not yet
available for use, the recoverable amount is estimated at each
reporting date. The recoverable amount of an asset is the greater
of its value in use and its fair value less costs to sell. 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 risk specific to the asset. The goodwill acquired in a
business combination, for the purpose of impairment testing, is
allocated to cash-generating units that are expected to benefit
from the synergies of the combination. An impairment loss is
recognised if the carrying amount of an asset exceeds its
recoverable amount. Impairment losses are recognised in the
consolidated income statement. An impairment loss in respect of
goodwill is not reversed irrespective of whether that loss is
recovered subsequently. In respect of other assets, impairment
losses recognised in prior periods are assessed at each reporting
date for any indications that the loss has decreased or no longer
exists. An impairment loss is reversed if there has been a change
in the estimates used to determine the recoverable amount. An
impairment loss is reversed only to the extent that the asset
carrying amount does not exceed the carrying amount that would have
been determined if no impairment loss had been recognised.
Financial assets
All financial assets are recognised and derecognised on a trade
date where the purchase or sale of a financial asset is under a
contract whose terms require delivery of the financial asset within
the timeframe established by the market concerned, and are
initially measured at fair value, plus transaction costs, except
for those financial assets classified as at fair value through
profit or loss, which are initially measured at fair value.
Financial assets are classified into the following specified
categories: financial assets 'at fair value through profit or loss'
(FVTPL), 'held-to-maturity' investments, 'available-for-sale' (AFS)
financial assets and 'loans and receivables'. The classification
depends on the nature and purpose of the financial assets and is
determined at the time of initial recognition.
Trade receivables
Trade receivables are recognised initially at amortised cost,
which is the fair value of consideration receivable and is adjusted
for provision or impairment. A provision for impairment of trade
receivables is established when there is objective evidence that
the Group will not be able to collect all the monies due. The
amount of the provision is recognised in the consolidated income
statement immediately.
Cash and cash equivalents
Cash and cash equivalents includes cash in hand, deposits held
at call with banks and other short-term highly liquid investments
with maturities of three months or less. Bank overdrafts that are
repayable on demand and form an integral part of the Group's cash
management are included as a component of cash and cash equivalents
for the purpose of the consolidated cash flow statement.
Bank borrowings and other loans
Interest-bearing loans and overdrafts are recorded at the
proceeds received, net of direct issue costs. Finance charges,
including premiums payable on settlement or redemption and direct
issue costs, are accounted for on an accruals basis using the
effective interest rate method and are added to the carrying amount
of the instrument to the extent that they are not settled in the
period in which they arise.
Share capital
(a) Ordinary shares
Ordinary shares are classified as equity. Incremental costs
directly attributable to the issue of ordinary shares and share
options are recognised as a deduction from equity, net of any tax
effects.
(b) Repurchase of share capital (treasury shares)
When share capital recognised as equity is repurchased, the
amount of the consideration paid, including directly attributable
costs, net of any tax effects, is recognised as a deduction from
equity. Repurchased shares are classified as treasury shares and
are presented as a deduction from total equity. When treasury
shares are sold or reissued subsequently, the amount received is
recognised as an increase in equity, and the resulting surplus or
deficit on the transaction is transferred to/from retained
earnings.
Taxation
Income tax payable is provided on taxable profits using tax
rates enacted or substantively enacted at the balance sheet
date.
Deferred taxation is provided in full, using the liability
method on temporary differences arising between the tax bases of
assets and liabilities and their carrying amounts in the
consolidated financial results. Deferred tax is determined using
tax rates (and laws) that have been enacted or substantively
enacted at the balance sheet date and are expected to apply when
the related balance sheet tax asset is realised or the deferred
liability is settled. Deferred income tax assets are recognised to
the extent that it is possible that future taxable profit will be
available against which temporary differences can be utilised.
Income tax is recognised in the consolidated income statement
except to the extent that it relates to items recognised directly
in equity, in which case it is recognised in equity.
Financial instruments
(a) Financial guarantee contracts
Where Group companies enter into financial guarantee contracts
to guarantee the indebtedness of other companies within the Group,
the Group considers these to be insurance arrangements, and
accounts for them as such. In this respect, the Group treats the
guarantee contract as a formal contingent liability until such time
as it becomes probable that the Company will be required to make a
payment under the guarantee.
(b) Non-derivative financial instruments
Non-derivative financial instruments comprise investments in
equity and debt securities, trade and other receivables, cash and
cash equivalents, loans and borrowings and trade and other
payables.
Non-derivative financial instruments are recognised initially at
fair value plus, for instruments not at fair value through profit
or loss, any directly attributable transaction costs. Subsequent to
initial recognition non-derivative financial instruments are
measured as described below.
Financial risk and credit management
The Group has exposure to the following risks from its use of
financial instruments:
(a) Liquidity risk
(b) Interest rate risk
This note presents information about the Group's exposure to
each of the above risks, the Group's objectives, policies and
processes for measuring and managing risks and the Group's
management of capital. Further quantitative disclosures are
included throughout these consolidated financial results.
The Board of Directors has overall responsibility for the
establishment and oversight of the Group's risk management
framework.
The Group's risk management policies are established to identify
and analyse the risks faced by the Group, to set appropriate risk
limits and controls, and to monitor risks and adherence to limits.
Risk management policies and systems are reviewed regularly to
reflect changes in market conditions and the Group's
activities.
The Group Audit Committee oversees how management monitors
compliance with the Group's risk management policies and procedures
and reviews the adequacy of the risk management framework in
relation to the risks faced by the Group.
(a) Liquidity risk
Liquidity risk is the risk that the Group will not be able to
meet its financial obligations as they fall due. The Group's
approach to managing liquidity is to ensure, as far as possible,
that it will always have sufficient liquidity to meet its
liabilities when due, under both normal and stressed conditions,
without incurring unacceptable losses or risking damage to the
Group's reputation. The strategy of the Directors (outlined
earlier) is designed to address the risk that the Group has
insufficient liquid resources to satisfy its requirements.
(b) Interest rate risk
The Group has no floating rate loans. Thus the Group has no
exposure to interest rate risk.
Capital management
The Board's policy is to maintain a strong capital base so as to
maintain investor, creditor and market confidence and to sustain
future development of the business. The Directors monitor the
return on capital, which the Group defines as net operating income
divided by total shareholders' equity. The Board also monitors the
level of dividends to ordinary shareholders.
From time to time the Group purchases its own shares on the
market; the timing of these purchases depends on market prices.
Primarily the shares are intended to be used for issuing shares
under the Group's share option programme. Buy and sell decisions
are made on a specific transaction basis by the Board of Directors;
the Group does not have a defined share buy-back plan.
There were no changes in the Group's approach to capital
management during the period.
Neither the Company nor any of its subsidiaries are subject to
externally imposed capital requirements.
Critical accounting estimates and judgements
Estimates and judgements are continually evaluated and are based
on historical experience and other factors, including expectations
of future events that are believed to be reasonable under the
circumstances.
The Group makes estimates and assumptions concerning the future.
The resulting accounting estimates will, by definition, seldom
equal the related actual results. The estimates and assumptions
that have a significant risk of causing a material adjustment to
the carrying amounts of assets and liabilities within the next
financial period are discussed below.
(a) Going concern basis of preparation
The Directors decision to prepare these accounts on a going
concern basis is based on assumptions which are discussed above and
in the business review.
Earnings per share
Basic and diluted
Earnings per share is calculated by dividing the (loss)/profit
attributable to the equity holders of the Company by the weighted
average number of Ordinary shares in issue during the period,
excluding Ordinary shares purchased by the Company and held as
treasury shares. The Company previously had one category of
dilutive potential Ordinary shares: LTIP awards. These have all
lapsed.
Half year Full year Half year
ended ended ended
30.06.17 31.12.16 30.6.16
GBP'000 GBP'000 GBP'000
------------------------------------- --------- --------- ---------
(Loss)/profit attributable to equity
holders of the Company (GBP'000) (192) (303) (137)
Weighted average number of shares in
issue 30,881 29,476 30,881
(Loss)/earnings per share (pence) (0.62) (1.03) (0.44)
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR SFIFMMFWSEFA
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August 17, 2017 02:00 ET (06:00 GMT)
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