TIDMMED
RNS Number : 6351H
Intelligent Ultrasound Group PLC
26 March 2020
The information contained within this announcement is deemed by
the Company to constitute inside information stipulated under the
Market Abuse Regulation (EU) No. 596/2014. Upon the publication of
this announcement via the Regulatory Information Service, this
inside information is considered to be in the public domain.
Intelligent Ultrasound Group plc
("Intelligent Ultrasound" or the "Group" or the "Company")
Unaudited Preliminary Results for the Year Ended 31 December
2019
Intelligent Ultrasound Group plc (AIM: MED), the ultrasound
artificial intelligence (AI) software and simulation company,
announces its unaudited preliminary results for the year ended 31
December 2019, showing another excellent year of progress for the
Group during which its Clinical AI Division signed its first AI
software agreement with a major ultrasound manufacturer and its
Simulation Division continued to grow sales.
Financial highlights:
-- Revenue from simulation sales grew 11% to GBP5.9m (2018: GBP5.3m)
-- Gross profit up 22% to GBP3.5m (2018: GBP2.8m)
-- R&D expenditure increased to GBP2.7m (2018: GBP1.9m)
-- Strengthened the balance sheet in August 2019 with a placing
and open offer which raised GBP5.8m after expenses
-- Year-end cash plus investments (short term deposits), at
GBP7.3m (2018: cash of GBP5.6m) and no debt(1)
-- Current cash of GBP6.2m
(1) excluding IFRS 16 lease liabilities
Operational highlights:
-- Signed first long-term AI software licence and co-development
agreement with one of the world's leading ultrasound equipment
manufacturers
-- Strong contribution from North America with revenue up 53% to GBP2.6m (2018: GBP1.7m)
-- Signed marketing partnership with Fujifilm SonoSite, Inc. in
North America for ultrasound training and services
-- Commenced alliance with Mediscan Systems to use AI and
simulation to improve patient care in India and enhance the Group's
ultrasound scan image library to over 4 million images (2018: 1
million images)
-- Commenced regulatory approval process and commercial
discussions for ScanNav AnatomyGuide's Peripheral Nerve Block AI
software
Post year end:
-- Received ISO13485:2016 medical device accreditation
-- Launched COVID-19 simulation training system
Commenting on the results, Riccardo Pigliucci, Chairman of
Intelligent Ultrasound said:
"2019 has been another year of excellent progress by the Group
and I would like to thank both our staff and our shareholders for
enabling this to happen. The Clinical AI Division has performed
particularly well, signing its first licensing agreement for
ScanNav with a major OEM and progressing commercial discussions for
its second AI software product. The reception for our products in
development at trade shows is particularly encouraging. The
Simulation Division has also worked hard to continue growing
revenue.
However, it would be wrong to ignore the recent spread of the
COVID-19 virus that is currently impacting all regions in which the
Group operates, and we have therefore implemented a number of
cost-saving measures that will enable the Group's EBITDA for FY2020
to remain in line with expectations. The outlook for the medium and
long term remains unchanged, with the Group expected to have
sufficient funds to continue its simulation and AI business
activities for the next twelve months, when the revenues from its
first AI software licence agreement are expected to be
generated.
We remain an ambitious Group that is excited about bringing our
first AI software products to market and continuing the growth of
the business over the coming years."
Enquiries:
Intelligent Ultrasound Group plc www.intelligentultrasound.com
Stuart Gall, CEO Tel: +44 (0)29 2075 6534
Helen Jones, CFO
Cenkos Securities - Nominated Advisor Tel: +44 (0)20 7397 8900
and broker
Giles Balleny / Cameron MacRitchie (Corporate
Finance)
Michael Johnson / Julian Morse (Sales)
Walbrook PR Tel: +44 (0)20 7933 8780 or intelligentultrasound@walbrookpr.com
Anna Dunphy / Paul McManus Mob: +44 (0)7876 741 001 / Mob: +44
(0)7980 541 893
About Intelligent Ultrasound Group (
www.intelligentultrasound.com )
Intelligent Ultrasound (AIM: MED) develops artificial
intelligence-based clinical image analysis software tools for the
diagnostic medical ultrasound market and hi-fidelity virtual
reality simulators for the ultrasound training market. Based in
Cardiff and Oxford in the UK, Atlanta in the US and with
representation in Beijing in Asia, the Group operates two
divisions:
Clinical AI Division
Focusses on developing deep learning-based algorithms to make
ultrasound machines smarter and more accessible. Products in
development include ScanNav which uses machine-learning based
algorithms to automatically identify and grade ultrasound images to
provide scan assessment and audit of protocol-based ultrasound
scanning; and AnatomyGuide, which aims to simplify
ultrasound-guided needling by providing the user with real-time
AI-based needle guidance software for a range of medical
procedures.
Simulation Division
Focusses on hi-fidelity ultrasound education and training
through simulation. Its three main products are the ScanTrainer
OBGYN training simulator, the HeartWorks echocardiography training
simulator and the BodyWorks Eve Point of Care and Emergency
Medicine training simulator. To date over 850 simulators have been
sold to over 500 medical institutions around the world.
CHAIRMAN'S STATEMENT
Overview of the year
2019 was a pivotal year for the Group with the pre-revenue
Clinical AI Division meeting all its commercial and development
milestones for its first two AI-based software platforms. This
included:
-- signing our first long-term licence and co-development
agreement in July 2019 with one of the world's leading ultrasound
equipment manufacturers for our AI-based real-time ultrasound
imaging software, a significant advance in validating our
commercial model; and
-- completing the pre-regulatory development of AnatomyGuide,
the real-time anatomy highlighting software for nerve blocks and
progressing both regulatory approval and commercial discussions
The Group's Simulation Division continued to show year-on-year
growth and increased revenue by 11% to GBP5.9m, with particularly
encouraging results in North America. The marketing partnership
agreement signed with Fujifilm SonoSite, Inc. in the second half of
the year, is a signal that our focus on high quality training
remains important to the ultrasound market.
Strategy
Just over two years ago, the Group took the strategic decision
to capitalise on our expertise in ultrasound image simulation and
training by expanding the business into the development of
real-time AI-based software for integration into ultrasound
equipment used in the clinic. The expansion required both the
successful acquisition and integration of The University of Oxford
start-up company, Intelligent Ultrasound Limited, to augment our
existing AI capability, as well as the support of shareholders to
fund the subsequent research and development.
Two years on, I am impressed to see how much the executive team
has achieved in such a short time, but I would also like to thank
our existing and new shareholders for having the vision to back the
Company through this strategic change.
A component of this strategy was to change the Company name from
MedaPhor Group plc to Intelligent Ultrasound Group plc. The Board
believes that the new name is reflective of our strategic change to
being both a leading developer of artificial intelligence clinical
software and a global leader in ultrasound training through
simulation.
Board and governance
The Board continues to recognise the importance of maintaining
the highest standards of corporate governance and, as such, the
Company has adopted the Quoted Companies Alliance Corporate
Governance Code. Towards the end of the year we appointed an
external advisor to conduct a full review of our board and its
performance. The review is currently on-going and it is expected
that its recommendations will be implemented during 2020.
At the end of the year, Wilson Jennings, the Group's CFO stepped
down from the Board and I would like to thank Wilson for his
valuable contribution since joining the Group ahead of our IPO in
2014 and to wish him well for the future in his semi-retirement.
Wilson has been an integral part of our team and he will be missed
by the management and staff alike.
At the same time the Board is very much enjoying working with
our new CFO, Helen Jones, who joined the Board on the 1 January
2020. She has a strong commercial and technical background that
will benefit the Group going forward.
People
I would like to thank all the staff in the Group for working so
hard in 2019 to grow the simulation business and to meet all the
development and commercial milestones that we set for the new AI
software products.
We operate in a highly competitive market and recruitment and
retention of the best people remains a priority for the Group.
Outlook
The Clinical AI Division performed particularly well in 2019,
meeting all its milestones including signing its first licensing
agreement with a major Original Equipment Manufacturer ("OEM") and
progressing development and commercial discussions for its second
AI software product. The Simulation Division also worked hard to
grow revenue, retain margins and keep its overheads in line with
expectations.
However, it would be wrong to ignore the recent spread of the
COVID-19 virus that is currently impacting all regions in which the
Group operates and we have therefore implemented a number of
cost-saving measures that will enable the Group's EBITDA for FY2020
to remain in line with expectations. The outlook for the medium and
long term remains unchanged, with the Group expected to have
sufficient funds to continue its simulation and AI business
activities for the next twelve months , when the revenues from its
first AI software licence agreement are also expected to be
generated .
The Group is currently prioritising its resources on developing
additional variants of its COVID-19 lung ultrasound training
module, as the frontline fight against the virus continues (details
of which are provided in the CEO's Report below); continuing to
progress all internal milestones for its ScanNav range of AI
products and accelerating proof of concept models for new AI
product variants. This will give the Group the potential to bring
additional AI products to market in 2021 and therefore be in a
stronger position when the current restrictions end.
We remain an ambitious Group, that is successfully expanding
into the new AI-based clinical software market and we are confident
that, once we are through this period of uncertainty, we can
continue to build upon this momentum.
Riccardo Pigliucci
Non-executive Chairman
CEO REVIEW
Artificial intelligence is expected to have a significant impact
on medical imaging over the next decade and we aim to be at the
forefront of that change as it happens, in ultrasound imaging.
To achieve this, we have organised the Group into two divisions
- Clinical AI and Simulation, both of which are supported by a
management and administrative resource. The report below details
how each division operates, the progress made over the year and the
key challenges that each division faced.
CLINICAL AI DIVISION
Our aim is to be a global leader in the provision of AI-based
clinical ultrasound software that can boost scanning quality and
streamline sonographer workflow in medical ultrasound specialties,
such as anaesthesiology, obstetrics, gynaecology, radiology and
primary care medicine, as well as making ultrasound accessible to
more medical professionals.
The Division is built around the 2017 acquisition of The
University of Oxford AI software company, Intelligent Ultrasound
Limited that supplemented our in-house image analysis and
ultrasound know-how and has enabled us to develop potentially
ground-breaking AI image analysis tools for the professional
ultrasound scanning market.
The algorithms are based on a growing database of over 4 million
images that drive our machine learning; combined with sophisticated
deep learning models originally developed by Professor Alison Noble
FRS OBE (a founder of Intelligent Ultrasound Limited) and her team
from The University of Oxford. This has enabled us to develop our
ScanNav image analysis software and the first releases of the
ScanNav family of products are in the process of being brought to
market in 2020.
On 4 July 2019 the Group announced that it had signed its first
long-term licence and co-development agreement for certain of its
AI software products in development with one of the world's leading
ultrasound equipment manufacturers. The long-term agreement will
enable the integration of our real-time image analysis software
onto a range of specialty specific ultrasound systems marketed in
the global healthcare market. The first royalty per unit revenues
are expected during 2021. Terms of the agreement remain
confidential and undisclosed for commercial reasons.
Software products in development include:
ScanNav Audit
The ScanNav Audit software provides real-time support for
ultrasound practitioners performing the 20-week fetal anomaly scan.
ScanNav Audit aims to ensure that a complete set of scan images,
that conform to the required global scanning protocols, are
captured during the procedure. The ScanNav software acts as a live
'virtual' peer-review, ensuring that the scan is performed
correctly by highlighting issues to the sonographer as he or she
saves each image. The software will also provide a record of each
sonographer's performance, allowing managers to monitor staff and
form part of the record keeping and audit requirements of the
clinic. ScanNav Audit requires regulatory approval prior to
launch.
The Group expects to develop multiple obstetrics variants of
ScanNav Audit to complement the 20-week protocol software described
above.
ScanNav AutoCapture
The ScanNav AutoCapture software automatically captures and
analyses all the ultrasound image planes in real-time, as the
sonographer moves the ultrasound probe over the patient's abdomen
during the 20-week fetal anomaly scan. The software then
automatically selects and saves the key images required to meet the
global protocols. The Directors believe that the ScanNav
AutoCapture software has the potential to:
-- speed up workflow - as the software automatically captures
the correct images, operators do not need to manually freeze and
save each image required by the protocol - allowing them to focus
on their dynamic assessment of the fetus ; and
-- improve accuracy and consistency - the use of AI software
should reduce the operator variability from the procedure, which is
expected to result in more accurate and consistent image
capture.
ScanNav AutoCapture requires further development and regulatory
approval prior to launch.
The Group also expects to develop multiple obstetrics variants
of ScanNav AutoCapture to complement the 20-week protocol software
described above.
ScanNav AnatomyGuide
ScanNav AnatomyGuide is an AI based ultrasound software product
which can automatically and in real-time, identify anatomical
structures on the live ultrasound scan image, highlighting
structures such as arteries that must be avoided during a needling
procedure. The software is currently being developed for use during
Peripheral Nerve Block (PNB) procedures to support less experienced
practitioners and its development has been partly funded by
Innovate UK.
PNB is a form of anaesthesia using needling that can be used for
certain surgical procedures as an alternative to general
anaesthesia and as a form of pain relief (potentially reducing the
need for opioid analgesia). The PNB procedure requires less time
and resource and is safer than general anaesthetic. However, PNB
requires significant skill to guide the needle safely through the
patient's anatomical structures and AnatomyGuide aims to assist the
anaesthetist during the procedure.
In May 2019, we made the first live demonstration of the ScanNav
AnatomyGuide software to clinicians at the Annual Scientific
Meeting of Regional Anaesthesia United Kingdom (RA-UK) .
The product development was substantially completed during 2019
for the first five nerve blocks and the regulatory and commercial
partner process has started, with the aim of bringing the first
variant of the product to market by the end of 2020.
Future ScanNav products
ScanNav Assist
The successful placing and open offer in August 2019 enabled the
Group to start the process of building a third software development
team that will look to begin the process of developing ScanNav
Assist. ScanNav Assist aims to facilitate the automatic recognition
of abnormalities within a general ultrasound scan confirming that a
clinician has correctly scanned the anatomical area of interest and
then flagging any areas of potential abnormality, so the patient
can be triaged to the appropriate specialist. The Directors believe
that ScanNav Assist will have the potential to allow more
point-of-care medical practitioners to use ultrasound imaging for
frontline diagnosis. The Directors believe that once developed such
a device would be likely to support a broad range of medical
professionals including GPs, midwives, paramedics and doctors
working in Emergency Rooms.
ScanNav HealthCheck
In the longer term, we are investigating the potential
development of AI software that could enable consumers to scan
themselves at home. ScanNav HealthCheck aims to develop the current
ScanNav technology to enable consumers to perform scans on
themselves. When combined with the next generation of low-cost
ultrasound devices, this software could have the potential to
enable health conscious individuals to benefit from the ability to
scan themselves at home.
AI image database
In March 2019, we announced an alliance with Mediscan Systems, a
premier fetal medicine and ultrasound research and training centre
based in India, under which the Group provides ScanTrainer
ultrasound training simulators in return for access to their large
ultrasound image libraries. This has enabled us to significantly
expand our AI image database by over one million images and we are
proud to support Mediscan in its goal of improving the quality of
ultrasound practise in India and throughout the world.
The Division's AI image database currently has in excess of 4
million images acquired from several providers and we expect the
growth in this database to continue in 2020 and beyond.
The curation and management of this data is of paramount
importance to the Group and, as such, all externally sourced
ultrasound imaging data is anonymised before it is sent to us.
Patient consent and the right to use the data are obtained under a
GDPR-compliant data sharing agreement for each image library.
Ultrasound scans recorded by the Group from volunteers are also
stored anonymously and always obtained with their consent and
conform to the GDPR.
Notwithstanding the data anonymisation, all image data is stored
securely, and its use is restricted to those who require access for
development work. None of the source images are used in products
sold to end-users as they are only used to train and create the
deep-learning models of the product.
Challenges to the Clinical Division
AI image analysis in ultrasound is a new area of medical
innovation and we are attempting to open up markets in which the
market size and the revenue models are unproven. We are also
attempting to do this with relatively limited funds, compared to
some of the AI based medical image analysis companies already
operating in the US, China and Israel.
The threat from COVID-19 has resulted in very necessary
restrictions being imposed on access to medical facilities, travel,
conferences and face-to-face meetings to try to control the spread
of the pandemic. This may compromise some aspects of our research
and development projects; however, our Clinical Division currently
still expects to meet its key milestone of first revenues in H1,
2021.
Our approach to these challenges is as follows:
-- continue to progress all internal milestones for the ScanNav range of AI products;
-- accelerate the development of any variants of these products;
-- focus on developing AI software that has both a clinical need
and a clear economic rationale for its purchase;
-- partner the development of our first products with OEMs who
can access the large ultrasound market more quickly with their
existing product ranges and sales networks and facilitate faster
regulatory approvals; and
-- continue to build our AI image database to ensure we have
high quality, curated images that will enable us to build AI
algorithms in the field of anaesthesiology, obstetrics,
gynaecology, radiology and primary care medicine.
The signing of our first agreement with one of the world's
leading ultrasound machine manufacturers, combined with the
encouraging reception to our products under development, has given
us confidence that we can turn them into commercial products that
can generate long-term revenue for the Division.
SIMULATION DIVISION
Based in Cardiff (UK), Alpharetta (US) and with representation
in Beijing (China), our Simulation Division designs, develops and
sells some of the world's leading hi-fidelity ultrasound training
systems for teaching ultrasound scanning to medical professionals
in institutions and medical device companies.
This is the original business of the Group which was created out
of Cardiff University Medical School and is the foundation of our
expertise in ultrasound imaging and understanding of the clinical
needs of the medical professionals who rely on ultrasound's growing
diagnostic capabilities.
Our comprehensive range of ultrasound training simulators are,
in the main, high value, cap-ex sales made to the global medical
institution market and sold through our direct sales forces in the
US and UK and a network of almost 30 resellers in the rest of the
world. The Division has continued to grow sales year-on-year, and
it is recognised as one of the gold standard providers of
ultrasound training simulators in the obstetrics/gynaecology
(OBGYN), echocardiography/anaesthesiology (ECHO) and emergency
medicine/point-of-care (PoCUS) markets.
During the year, the division reduced its net cash consumption
impact on the Group.
Research & Development
During 2019 the Simulation R&D team focussed much of its
resource on the development of a new Compact version of the
ScanTrainer for the OBGYN markets that aims to extend ScanTrainer's
appeal to smaller hospitals and medical simulation centres in the
US and around the world.
In addition, a new augmented reality (AR) app was developed,
based on the HeartWorks software, aimed at broadening its appeal to
the global cardiac and echocardiography teaching market and
potentially to individual doctors who will benefit from access to
the system's market leading 3D cardiac anatomy and ultrasound
capabilities.
Post year end we launched a COVID-19 version of our BodyWorks
Point-of-Care simulator, designed to train healthcare providers to
use lung ultrasonography. Ultrasound has major utility for the
management of respiratory related COVID-19 due to its safety,
repeatability, absence of radiation, low cost, ease of disinfection
and point of care use. This new training simulator, as well as the
free COVID-19 upgrade training module for all our existing
BodyWorks customers, includes a number of examples of lung
ultrasound appearances typical of COVID-19 infection to enable
frontline clinical staff to practise and train in the use of lung
ultrasound. The module was made available to the market on 24 March
2020 and the first systems are already in use in the UK and US. We
hope this initiative will help with the training of healthcare
professionals working in the frontline of this global
emergency.
Territory review
Our Simulation Division sales grew by 11% to GBP5.9m in 2019
(2018: GBP5.3m) and there are positive signs that the ultrasound
simulator market for hi-fidelity training simulators will continue
this growth once we are through the disruption currently being
experienced as a result of the COVID-19 pandemic.
North America
Revenue in 2019 increased by over 50% to GBP2.6m (2018:
GBP1.7m).
This was an excellent performance by the North America team and
the region remains a key market for medical simulation. Based in
Alpharetta, Georgia, the team are now able to provide full sales,
marketing, shipping, technical support and small-scale local system
build and we believe this capability was an important element in
enabling us to enter into a marketing agreement with Fujifilm
SonoSite, Inc. to deliver a training solution to the point-of-care
ultrasound (PoCUS) market.
The agreement utilises Intelligent Ultrasound's BodyWorks Eve
PoCUS training solution and the HeartWorks transthoracic
echocardiography (TTE) and transoesophageal echocardiography (TEE)
simulator training platforms to accelerate training for all
Fujifilm SonoSite's PoCUS systems. Both companies will co-exhibit
at numerous conferences, as well as providing hands-on workshops
where clinician training is needed.
During the year sales of HeartWorks and BodyWorks on the new Eve
manikin platform were particularly encouraging and we expect the
Fujifilm SonoSite marketing agreement will generate increased
awareness and therefore demand for these simulators.
Rest of the World
Revenue in 2019 was steady at GBP2.6m (2018: GBP2.6m).
Revenue in the Rest of the World is mainly generated by our
reseller network of just under 30 resellers and included simulation
system sales of GBP0.5m (2018: GBPNil) at fair value, which were
exchanged for ultrasound images under the alliance with Mediscan
referred to above . As well as a landmark sale of multiple systems
to universities in Romania, we were encouraged by good growth in
the Iberian market. France however, proved to be a more challenging
market in 2019, but a refreshment of the reseller parties is
expected to strengthen our position in the region.
United Kingdom
Revenue in 2019 declined by 28% to GBP0.7m (2018: GBP1.0m).
The UK had a difficult year, which is believed to be in part due
to the inertia in NHS non-essential spending caused by the
continued delay in completing Brexit. Despite significant interest
being shown by hospital departments wishing to buy our systems,
many found their purchase requests being delayed or blocked by the
hospital procurement departments. After a very challenging 2019,
the Chancellor's budget on 11 March 2020 offered some comfort
through his commitment to provide more funding for the NHS.
Challenges to the Simulation Division
High values sales in the medical training sector remain affected
by health budgets, which can be both hard to access and predict,
especially during times of political upheaval or global pandemics,
which can divert funds from training to frontline care. Like many
markets, medical simulation is subject to competitive products and
associated pricing and margin pressures.
The Division has historically responded well to these pressures
by focussing on offering products that provide a gold standard in
training ultrasound. This has traditionally been important to
end-users whose careers depend on their ability to scan and
diagnose using ultrasound and as a consequence, purchasing
decisions tend to be based on quality of training and value for
money rather than the lowest price solution.
Clearly the potential impact on sales from both the ongoing exit
of the UK from the EU and COVID-19 are difficult to quantify at
this time, but are being closely monitored by the Group to assess
the impact on inventory, its supply chain and staff availability,
as well as revenue. The development of a new simulation system
aimed at training medical professionals working in response to the
threat from COVID-19 is an example of the Division's agile response
to unpredictable market conditions.
Quality Management System
In 2018 the UK operation implemented a Quality Management System
and I'm pleased to say that post year-end on 4 March 2020, we
received ISO 13485:2016 certification following an audit of our
systems by the certification body, LRQA.
ISO 13485:2016 is the internationally recognised quality
standard to ensure the consistent design, development, production,
installation and sale of medical devices that are safe for their
intended purposes. The Group's Clinical AI Division is in the
process of bringing a range of AI-based image analysis software
products to market and obtaining ISO 13485:2016 certification is an
essential step in taking these products through regulatory
approval.
Workplace environment
We recently merged our two UK sites into the Cardiff office but,
in response to the threat from COVID-19, we have now implemented a
working from home policy for the majority of our staff. In the
longer term, we intend to move to larger, more modern and flexible
office space in the centre of Cardiff, but until then, we will
continue to host live demonstrations of all our latest technology
at our current head office facility at the Cardiff Medicentre. We
were recently proud to host a visit by the Chancellor of the Duchy
of Lancaster, The Rt Hon Michael Gove MP and The Secretary of State
for Wales, The Rt Hon Simon Hart MP, when they experienced
first-hand the advances the Group has made over the last two
years.
We would be delighted to welcome any shareholders or prospective
investors should they also wish to visit us to see our technology
for themselves.
Looking ahead
Despite the understandable concerns over COVID-19, we aim to
continue to be both ambitious and successful in our quest to train
medical professionals in the use of ultrasound, which, more than
ever, is a key medical diagnostic tool; as well as develop
cutting-edge AI software technology that will generate long-term
licence revenue for the Group over the coming years.
Stuart Gall
Chief Executive Officer
FINANCIAL REVIEW
Summary financial performance
2019 2018
Revenue (GBPm) 5.9 5.3
Gross profit (GBPm) 3.5 2.8
Gross profit margin (%) 58 53
R&D costs expensed (GBPm) 2.2 1.3
Administrative expenses (GBPm) (8.2) (7.1)
Adjusted EBITDA* (GBPm) (3.1) (2.7)
Loss after taxation (GBPm) (4.2) (3.4)
Cash and investments (short term deposits) (GBPm) 7.3 5.6
--------------------------------------------------- ------ ------
*Non-GAAP measure reconciled below
Revenue
Revenues from the Simulation Division increased 11% to GBP5.9m
(2018: GBP5.3m). The growth achieved this year was due to strong
simulator sales in North America, up by GBP0.9m (53%) compared to
2018. However, this was partially offset by a fall in UK sales of
GBP0.3m (28%) considered to be attributable to continued training
budget cuts in the NHS and uncertainty surrounding the timing and
impact of Brexit. Sales in the Rest of the World were in line with
2018.
Gross profit
Gross margin increased from 53% in 2018 to 58% in 2019 and was
helped by the higher proportion of direct sales representing 56% of
total sales (2018: 50%), as well as a number of higher margin
distribution sales.
Administrative expenses
Administrative expenses increased by GBP1.1m during the year to
GBP8.2m (2018: GBP7.1m) as a result of our continued increased
investment in R&D activity, particularly in the Clinical AI
Division. We also increased the number of sales support staff
employed in North America and the number of logistics staff in the
UK.
Research and development costs and grants received
The Group expensed through the income statement GBP2.2m (2018:
GBP1.3m) of R&D costs in 2019, largely in relation to earlier
stage R&D activity in the Clinical AI Division, which had not
yet met the criteria for capitalisation under IAS 38. A further
GBP0.5m (2018: GBP0.5m) of costs relating to the continued ongoing
development of products in the Simulation Division were capitalised
within intangible assets.
The Group received an R&D grant from Innovate UK of GBP0.2m
(2018: GBP0.3m) which has been included within Other Income.
Adjusted EBITDA
2019 2018
GBPm GBPm
----------------------------- ------ ------
Operating loss (4.6) (3.6)
Add back/(deduct):
Depreciation & amortisation 1.4 1.2
Share option charges 0.1 0.1
Exceptional items - (0.4)
----------------------------- ------ ------
Adjusted EBITDA (3.1) (2.7)
----------------------------- ------ ------
The adjusted EBITDA loss increased by GBP0.4m in 2019 which was
mainly attributable to the higher level of investment in R&D
activity during in the year.
Adjusted EBITDA is not a measurement of financial performance
under IFRS however it is considered that the presentation of
adjusted EBITDA enhances the understanding of the Group's financial
performance, in regard to understanding its ability to generate
stable and predictable cash flows from operations.
Exceptional items in 2018
The Exceptional item in the prior year related to a credit of
GBP0.4m in respect of a fair value adjustment on the settlement of
contingent consideration relating to the acquisition of Intelligent
Ultrasound Limited ("IUL") in 2017.
Taxation
The Group claims each year for R&D tax credits and, since it
is loss-making, elects to surrender these tax credits for a cash
rebate. The amount included within the consolidated income
statement in respect of amounts received and receivable for the
surrender of R&D expenditure was GBP0.168m (2018: GBP0.214m).
The 2019 tax credit also includes GBP0.08m credit in respect of a
release of a provision made in 2018 for potential pre-acquisition
over claims of R&D tax credits in IUL which HMRC confirmed in
the period does not need to be repaid. The tax credit for the year
also includes deferred tax of GBP0.09m (2018: GBP0.09m) on the fair
value of intangible fixed assets acquired with Inventive Medical
Limited ('IML') and IUL which is being recognised over the life of
those assets.
As at 31 December 2019, the Group has cumulative gross UK tax
losses of approximately GBP14.9m (2018: GBP11.4m) for which no
deferred tax asset has been recognised.
Placing and open offer
On 28 August 2019 the Company issued 63,369,043 new ordinary
shares of 1 pence each at a price of 10 pence per share which
raised GBP6.3m before costs of the share issue and GBP5.8m after
costs. The share issue costs of GBP0.5m have been netted off
against the share premium arising on the new share issue.
Balance sheet
Consolidated net assets increased to GBP11.0m (2018: GBP9.3m).
Intangible fixed assets at GBP2.3m were GBP0.6m lower than the
carrying amount at 31 December 2018 of GBP2.9m. Additions to
intangibles in the year were GBP0.5m (2018: GBP0.5m) relating to
capitalised development costs; whereas, amortisation of all
intangibles including IP and brands totalled GBP1.0m (2018:
GBP1.0m).
The Group adopted the new leasing standard IFRS 16 in 2019 and
recognised an additional GBP0.1m within property, plant and
equipment and a corresponding lease liability in relation to leases
of office space and company cars.
Trade and other receivables of GBP2.7m (2018: GBP1.9m) have
increased largely due to the timing profile of the high level of
sales in the last quarter of 2019. Trade and other payables of
GBP1.8m (2018: GBP1.5m) include GBP0.2m of warrants issued as part
of the consideration paid for IUL (2018: GBP0.2m).
Cash and investments
Cash and cash equivalents at 31 December 2019 stood at GBP1.8m
(2018: GBP5.6m). The Group also had GBP5.5m of investments in the
form of cash held in short term deposits that matured post year end
on 6 January 2020.
Net cash used in operating activities was GBP3.3m (2018:
GBP2.6m) and the net cash outflow arising from investment
activities was GBP6.3m (2018: outflow of GBP0.9m) due to the cash
held in short term deposits. Cash flow in the year was boosted by
the placing of new ordinary shares in the Company which raised
GBP5.8m net of costs (2018: placing raised GBP4.8m net of costs).
The net proceeds have been, and will continue to be, used for the
research and development to bring the ScanNav products to market
and to continue the proof of concept research and development work
on future ScanNav products and general working capital.
The Group continues to explore appropriate financing options
that will fund its growth from 2021 onwards.
Events since the end of the financial year
The recent spread of the COVID-19 virus and the resultant
downturn in global business are well documented and impacting all
regions in which the Group operates. There is also considerable
uncertainty over the likely duration of the disruption.
Consequently, in anticipation of a short term slow-down in global
simulator sales, we have implemented a number of cost saving
measures that will enable the Group's EBITDA to remain in line with
expectation. The outlook for the medium and long term remains
unchanged, with the Group expected to have sufficient funds to
continue its simulation and AI business activities well into 2021,
when the revenues from its first AI software licence agreement are
expected to be generated.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
for the year ended 31 December 2019
Unaudited Audited
Note 2019 2018
GBP GBP
Continuing operations
REVENUE 2 5,915,671 5,313,164
Cost of sales (2,462,207) (2,479,781)
----------- -----------
GROSS PROFIT 3,453,464 2,833,383
Other income 157,314 310,475
Administrative expenses excluding exceptional
costs (8,168,711) (7,120,434)
Exceptional administrative items 3 - 362,718
----------- -----------
Total administrative costs (8,011,397) (6,447,241)
----------- -----------
OPERATING LOSS (4,557,933) (3,613,858)
Finance costs (2,002) (7,402)
----------- -----------
LOSS BEFORE INCOME TAX (4,559,935) (3,621,260)
Income tax credit 4 337,517 203,796
LOSS ATTRIBUTABLE TO THE EQUITY SHAREHOLDERS OF
THE PARENT (4,222,418) (3,417,464)
----------- -----------
OTHER COMPREHENSIVE INCOME
Items that will or may be reclassified to
profit or loss:
Exchange (loss)/gain arising on translation
of foreign operations (33,453) 844
------------- -------------
OTHER COMPREHENSIVE INCOME FOR THE YEAR (33,453) 844
TOTAL COMPREHENSIVE INCOME ATTRIBUTABLE TO
THE EQUITY SHAREHOLDERS OF THE PARENT (4,255,871) (3,416,620)
============= =============
LOSS PER ORDINARY SHARE (PENCE) ATTRIBUTABLE
TO THE EQUITY SHAREHOLDERS OF THE PARENT
Basic and diluted 5 (2.37)p (3.59)p
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
for the year ended 31 December 2019
Unaudited Audited
2019 2018
Note GBP GBP
NON-CURRENT ASSETS
Intangible assets 2,331,779 2,886,562
Property, plant and equipment 544,775 417,732
------------ ------------
2,876,554 3,304,294
------------ ------------
CURRENT ASSETS
Inventories 663,240 851,491
Trade and other receivables 2,699,608 1,912,975
Current tax assets 147,517 80,302
Investments (short term deposits) 5,500,000 -
Cash and cash equivalents 1,790,318 5,607,052
------------ ------------
10,800,683 8,451,820
------------ ------------
TOTAL ASSETS 13,677,237 11,756,114
------------ ------------
CURRENT LIABILITIES
Trade and other payables 6 (1,795,698) (1,467,865)
Deferred income (325,177) (311,496)
Lease liabilities (53,095) -
Current tax liabilities - (100,000)
Provisions (94,776) (68,972)
------------ ------------
(2,268,746) (1,948,333)
------------ ------------
NON-CURRENT LIABILITIES
Deferred income (108,680) (160,074)
Deferred taxation (287,994) (377,994)
Lease liabilities (20,340) -
------------ ------------
(417,014) (538,068)
------------ ------------
TOTAL LIABILITIES (2,685,760) (2,486,401)
------------ ------------
NET ASSETS 10,991,477 9,269,713
============ ============
EQUITY AND RESERVES
Share capital 7 2,199,968 1,566,278
Share premium 21,653,273 16,437,213
Accumulated losses (20,074,969) (15,854,436)
Share-based payment reserve 687,600 561,600
Merger reserve 6,538,023 6,538,023
Foreign exchange reserve (12,418) 21,035
TOTAL EQUITY 10,991,477 9,269,713
============= =============
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
for the year ended 31 December 2019
Share Share Accumulated Share-based Merger Foreign Total equity
capital premium losses payment Reserve exchange attributable
reserve reserve to shareholders
GBP GBP GBP GBP GBP GBP GBP
BALANCE AS AT 1
JANUARY 2018 907,015 12,216,670 (12,436,972) 413,600 6,013,065 20,191 7,133,569
COMPREHENSIVE
INCOME
FOR THE YEAR
Loss for the year
and total
comprehensive
income - - (3,417,464) - - 844 (3,416,620)
TRANSACTIONS WITH
OWNERS, RECORDED
DIRECTLY IN EQUITY
Shares issued for
cash 597,503 4,481,275 - - - - 5,078,778
Cost of raising
finance - (260,732) - - - - (260,732)
Retention shares
issued further
to acquisition
of IUL 61,760 - - - 524,958 - 586,718
Cost of
share-based
awards - - - 148,000 - - 148,000
---------- ----------- ------------- ------------ ---------- ---------- -----------------
659,263 4,220,543 - 148,000 524,958 - 5,552,764
---------- ----------- ------------- ------------ ---------- ---------- -----------------
BALANCE AS AT 31
DECEMBER 2018 as
previously stated
(audited) 1,566,278 16,437,213 (15,854,436) 561,600 6,538,023 21,035 9,269,713
Impact of IFRS
16 - - 1,885 - - 1,885
---------- ----------- ------------- ------------ ---------- ---------- -----------------
BALANCE AS AT 1
JANUARY 2019 as
restated 1,566,278 16,437,213 (15,852,551) 561,600 6,538,023 21,035 9,271,598
COMPREHENSIVE
INCOME
FOR THE YEAR
Loss for the year
and total
comprehensive
income - - (4,222,418) - - (33,453) (4,255,871)
TRANSACTIONS WITH
OWNERS, RECORDED
DIRECTLY IN EQUITY
Shares issued for
cash 633,690 5,703,214 - - - - 6,336,904
Cost of raising
finance - (487,154) - - - - (487,154)
Cost of
share-based
awards - - - 126,000 - - 126,000
---------- ----------- ------------- ------------ ---------- ---------- -----------------
633,690 5,216,060 - 126,000 - - 5,975,750
---------- ----------- ------------- ------------ ---------- ---------- -----------------
BALANCE AT 31
DECEMBER
2019 (unaudited) 2,199,968 21,653,273 (20,074,969) 687,600 6,538,023 (12,418) 10,991,477
---------- ----------- ------------- ------------ ---------- ---------- -----------------
CONSOLIDATED STATEMENT OF CASH FLOWS
for the year ended 31 December 2019
Unaudited Audited
2019 2018
GBP GBP
Cash flows from operating activities
Loss before tax (4,559,935) (3,621,260)
Depreciation 334,209 244,957
Amortisation of intangible assets 1,040,032 992,586
Fair value adjustment on contingent consideration - (362,718)
Finance costs 2,002 7,402
Share-based payment charge 126,000 148,000
----------- -----------
Operating cash flows before movement in working
capital (3,057,692) (2,591,033)
Movement in inventories 188,251 (438,247)
Movement in trade and other receivables (786,633) (203,539)
Movement in trade and other payables 282,570 507,545
----------- -----------
Cash used in operations (3,373,504) (2,725,274)
Income taxes received 80,302 133,495
----------- -----------
NET CASH USED IN OPERATING ACTIVITIES (3,293,202) (2,591,779)
----------- -----------
Cash flows from investing activities
Purchase of property, plant and equipment (355,321) (361,707)
Disposal of property, plant and equipment 12,194 11,523
Increase in short term deposits (5,500,000) -
Internally generated intangible assets (485,249) (512,671)
NET CASH USED IN INVESTING ACTIVITIES (6,328,376) (862,855)
----------- -------------
Cash flows from financing activities
Issue of new shares 6,336,904 5,078,778
Share issue costs (487,154) (260,732)
Principal elements of lease payments (37,371) -
Finance costs paid (2,002) (7,402)
NET CASH GENERATED FROM FINANCING ACTIVITIES 5,810,377 4,810,644
----------- -------------
NET (DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS (3,811,201) 1,356,010
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 5,607,052 4,250,198
Exchange (losses)/gains on cash and cash equivalents (5,533) 844
CASH AND CASH EQUIVALENTS AT OF YEAR 1,790,318 5,607,052
=========== =============
NOTES TO THE PRELIMINARY RESULTS
for the year ended 31 December 2019
1. GENERAL INFORMATION
Intelligent Ultrasound Group plc ("the Company") is a publicly
limited liability company incorporated and domiciled in the United
Kingdom whose shares are traded on AIM, a market operated by the
London Stock Exchange. The Company's registration number is
09028611 and its registered office address is Cardiff Medicentre,
Heath Park, Cardiff, CF14 4UJ.
The financial information for the year ended 31 December 2019
set out in this announcement does not constitute statutory accounts
within the meaning of Section 434 of the Companies Act 2006.
Statutory accounts for the year ended 31 December 2018 have been
delivered to the Registrar of Companies and those for 2019 will be
delivered following the Company's Annual General Meeting
('AGM').
BASIS OF PREPARATION
The financial information has been prepared in accordance with
the recognition and measurement criteria of International Financial
Reporting Standards ('IFRS') adopted for use in the European Union
(EU) and in accordance with the AIM rules and the Companies Act
2006. However, this announcement does not itself contain sufficient
information to comply with IFRS. The Company will publish full
financial statements that comply with EU adopted IFRS in April
2020.
The consolidated preliminary results incorporate the results of
the Company and its subsidiary undertakings (together the
'Group').
The accounting policies applied in these consolidated
preliminary results are consistent with those of the annual
financial statements for the year ended 31 December 2018, as
described in those annual financial statements, except for the
adoption of IFRS 16 'Leases'.
GOING CONCERN
The unaudited consolidated preliminary results have been
prepared on a going concern basis. The Group meets its day-to-day
working capital requirements from its cash reserves. The Group
expects that it will need to raise additional funds through either
equity-based investor funding or debt finance within the next 12 to
15 months. Subject to this, the directors have a reasonable
expectation that the Group has adequate resources to continue in
operational existence for the foreseeable future and therefore
continue to adopt the going concern basis of accounting in
preparing the annual financial statements. However, in the absence
of binding agreements combined with the current uncertain global
economic outlook due to the COVID-19 pandemic, there can be no
guarantee that additional funds will be made available as required.
The Group is currently monitoring the COVID-19 situation on a daily
basis with cash preservation a primary concern and as a result has
revised its forecasts and subsequent sensitivity analysis to
reflect certain cost cutting measures implemented to mitigate any
potential impact on short term revenues and loss after tax. Current
conditions therefore indicate the existence of a material
uncertainty which may cast significant doubt about the ability of
the Company and the Group to continue as going concerns. These
financial statements do not include any adjustments that would
result from the going concern basis of preparation being
inappropriate.
IFRS 16 'Leases'
The Group has adopted IFRS 16 'Leases' from 1 January 2019. The
nature and effect of the changes as a result of adoption of this
new accounting standard are described below. Several other
amendments and interpretations apply for the first time in 2019,
but do not have an impact on the consolidated financial statements
of the Group. The Group has not early adopted any standards,
interpretations or amendments that have been issued but are not yet
effective.
The Group has not restated comparatives for the 2018 reporting
period, as permitted under the specific transition provisions in
the standard. The Group adopted IFRS 16 using the modified
retrospective method of adoption with the date of initial
application of 1 January 2019. Under this method, the standard is
applied retrospectively with the cumulative effect of initially
applying the standard recognised at the date of initial
application. The Group elected to use the transition practical
expedient to not reassess whether a contract is, or contains a
lease at 1 January 2019. The Group recognised lease liabilities in
relation to leases which had previously been classified as
'operating leases' under the principles of IAS 17 'Leases'. These
liabilities were measured at the present value of the remaining
lease payments, discounted using the lessee's incremental borrowing
rate as of 1 January 2019. The weighted average lessee's
incremental borrowing rate applied to the lease liabilities on 1
January 2019 was 4%.
i) Practical expedients applied
In applying IFRS 16 for the first time, the Group has used the
following practical expedients permitted by the standard:
-- accounting for operating leases with a remaining lease term
of less than 12 months as at 1 January 2019 as short-term
leases;
-- excluding initial direct costs for the measurement of the
right-of-use asset at the date of initial application; and
-- The Group has also elected not to reassess whether a contract
is or contains a lease at the date of initial application. Instead,
for contracts entered before the transition date the group relied
on its assessment made applying IAS 17 and IFRIC 4 'Determining
whether an Arrangement contains a Lease'.
ii) Impact of adoption
The effect of adoption of IFRS 16 as at 1 January 2019
(increase/(decrease)) is, as follows:
GBP
ASSETS
Property, plant and equipment 32,561
--------
LIABILITIES
Lease liabilities (30,676)
--------
OPENING ADJUSTMENT TO EQUITY (1,885)
--------
iii) Measurement of lease liabilities
GBP
Operating lease commitments disclosed as at 31
December 2018 38,237
Discounted using incremental borrowing rate as
at 1 January 2019 (1,388)
-------
Discounted operating lease commitments as at 1
January 2019 36,849
Less: commitments relating to short term leases (6,173)
-------
LEASE LIABILITIES AS AT 1 JANUARY 2019 30,676
-------
iv) Impact on 2019
Increase in depreciation expense due to increase in
right-of-use assets 39,284
Decrease in administrative expenses due to lower operating
lease rental costs (40,387)
Increase in finance costs relating to the interest expense
on additional lease liabilities 3,016
Increase in loss on disposal of property, plant and
equipment 2,927
--------
NET INCREASE IN LOSS AFTER TAXATION 4,840
--------
Decrease in cash outflows from operating activities (37,301)
Increase in cash outflows from financing activities 37,301
--------
2. REVENUE ANALYSIS
The chief operating decision maker ('CODM') is defined as the
Board. The format of revenue reporting is based on the Group's
management and internal reporting (including reports to the CODM)
of the Divisions below which carry different risks and rewards and
are used to make strategic decisions. Distribution is the sale of
products through the Group's resellers. Direct Sales represents the
sale of the products and services direct to customers. The Group's
Clinical AI Division which develops image analysis software for
ultrasound through the development of deep-learning software was
established in October 2017 with the acquisition of IUL and has not
made any material sales to date.
The Board review the revenue and gross margin by division and
channel (Distribution/Direct) and are not reporting segments under
IFRS 8. All revenue is generated from external customers.
Year ended 31 December 2019 Simulation Clinical Total
Division AI Division
Distribution Direct Sales
GBP GBP GBP GBP
Revenue 2,616,178 3,299,493 - 5,915,671
------------- ------------- ------------- ----------
Gross profit 1,435,987 2,017,477 - 3,453,464
------------- ------------- ------------- ----------
Year ended 31 December 2018 Simulation Clinical Total
Division AI Division
Distribution Direct Sales
GBP GBP GBP GBP
Revenue 2,630,116 2,683,048 - 5,313,164
------------- ------------- ------------- ----------
Gross profit 1,237,938 1,595,445 - 2,833,383
------------- ------------- ------------- ----------
The following table provides an analysis of the Group's revenue
by geography based upon the location of the Group's customers.
Year ended 31 December 2019 Simulation Clinical Total
Division AI Division
Distribution Direct Sales
GBP GBP GBP GBP
United Kingdom - 720,355 - 720,355
North America - 2,579,138 - 2,579,138
Rest of World 2,616,178 - - 2,616,178
2,616,178 3,299,493 - 5,915,671
============= ============= ============= ==========
Rest of World sales in the year to 31 December 2019 included
GBP455,339 of ScanTrainer simulation system sales at fair value
which were exchanged for ultrasound images under the alliance with
Mediscan, details of which are provided in the CEO Review above
(2018: GBPNil).
Year ended 31 December 2018 Simulation Clinical Total
Division AI Division
Distribution Direct Sales
GBP GBP GBP GBP
United Kingdom - 994,080 - 994,080
North America - 1,688,968 - 1,688,968
Rest of World 2,630,116 - - 2,630,116
2,630,116 2,683,048 - 5,313,164
============= ============= ============= ==========
Included within non-UK revenues are sales to the following
countries which accounted for more than 10% of the Group's total
revenue for the year:
2019 2018
GBP GBP
USA 2,203,585 1,560,624
China 597,695 710,689
========= =========
The Group had no customers who accounted for more than 10% of
the Group revenue for the year ended 31 December 2019 or the year
ended 31 December 2018.
3. EXCEPTIONAL ITEMS
2019 2018
GBP GBP
Fair value adjustments on contingent consideration - (362,718)
- (362,718)
=========================================================== ==========
The fair value adjustment on contingent consideration in 2018
arose on the settlement during that year of the retained
consideration on the acquisition of IUL. The difference between the
original fair value of the Deferred Consideration and the fair
value of the Deferred Consideration at the settlement date of
GBP362,718 was recognised in the 2018 Consolidated Statement of
Comprehensive Income as a fair value adjustment on deferred
consideration and included within exceptional items.
4. INCOME TAX
Analysis of credit in the year
2019 2018
GBP GBP
R&D tax credit (167,517) (213,796)
Adjustment for over-claim of R&D tax credit in
prior periods (80,000) 100,000
Deferred tax credit (90,000) (90,000)
--------- ---------
(337,517) (203,796)
========= =========
5. LOSS PER ORDINARY SHARE
The earnings per ordinary share has been calculated using the
loss for the year and the weighted average number of ordinary
shares in issue during the year as follows:
2019 2018
GBP GBP
Loss for the year after taxation (4,222,418) (3,417,464)
============ ============
2019 2018
Number of ordinary shares of 1p each No. No.
Basic and diluted weighted average
number of ordinary shares 178,503,090 95,233,054
------------------ ------------------
Basic loss pence per share (2.37)p (3.59)p
At 31 December 2019 and 2018 there were share options
outstanding which could potentially have a dilutive impact but were
anti-dilutive in both years.
6. CURRENT LIABILITIES - TRADE AND OTHER PAYABLES
2019 2018
GBP GBP
Trade payables 715,828 665,040
Taxation and social security 81,326 88,870
Accruals 763,703 507,568
Warrants 165,464 165,464
Other 69,377 40,923
1,795,698 1,467,865
========= ===========
7. SHARE CAPITAL
2019 2018
No. GBP No. GBP
Allotted, issued and fully
paid
Ordinary shares of 1p each
Balance at 1 January 156,627,749 1,566,278 90,701,443 907,015
Shares issued for cash 63,369,043 633,690 59,750,331 597,503
Shares issued on acquisition
of IUL - - 6,175,975 61,760
Balance at 31 December 219,996,792 2,199,968 156,627,749 1,566,278
================== ============== =================== ==============
The fair values and premium arising on shares issued during the
year are as follows:
Date Description Shares Fair value Premium
number GBP GBP
Shares issued in connection with
28 August 2019 capital raising 63,369,043 633,690 5,703,214
---------- ---------- ---------
On 28 August 2019 the Company placed 63,369,043 newly issued
shares of 1 pence each in the capital of the Company at a price of
10 pence per share. Share issue costs of GBP487,154 have been
netted off against the share premium arising on the new share
issue.
One third of the consideration payable in respect of the
acquisition of IUL in 2017 was deferred for 12 months from
completion with the actual number of deferred shares and warrants
to be issued dependent on any vendor warranty or indemnity breaches
(as specified in the Sale and Purchase Agreement) arising during
that 12 month period. The Company was not aware of any vendor
warranty or indemnity breaches and so the 6,175,975 deferred
consideration shares (with a fair value of GBP586,718 at 9.5 pence
per share) were admitted to trading on 9 October 2018 and 418,897
deferred consideration warrants were issued at their fair
value.
The share premium arising was subject to merger relief and has
been taken to merger reserve.
On 13 December 2018 the Company placed 59,750,331 newly issued
shares of 1 pence each in the capital of the Company at a price of
8.5 pence per share. Share issue costs of GBP260,732 were netted
off against the share premium arising on the new share issue.
8. SUBSEQUENT EVENTS
Any potential impact of the COVID-19 viral pandemic is a
non-adjusting post balance sheet event in accordance with IAS 10
'Events after the Reporting Period' on the basis that the
significant development and spread of the virus did not take place
until January 2020. The downturn in global business resulting from
the pandemic are impacting all regions in which the Group operates.
There is also considerable uncertainty over the likely duration of
the disruption. To counter any short term slow-down in revenue a
number of cost reduction measures have been implemented to mitigate
the impact. As such the current expectation is for the outlook in
the medium and long term to remain in line with expectations.
9. PUBLICATION OF FINANCIAL STATEMENTS
It is anticipated that the full Annual Report and Financial
Statements will be published in April 2020. Copies will be
available from this date at the Company's head office; Cardiff
Medicentre, Heath Park, Cardiff, CF14 4UJ and on the Company's
website ( www.intelligentultrasoundgroup.com ).
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
FR SEDESIESSEFD
(END) Dow Jones Newswires
March 26, 2020 03:00 ET (07:00 GMT)
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