TIDMCPT
RNS Number : 8860Y
Concepta PLC
14 May 2019
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 now considered to be in the public domain
Concepta Plc ("Concepta" or the "Company")
Annual Results
Concepta Plc (AIM: CPT), the innovative UK personalised
healthcare company and developer of the proprietary self-test
platform ("myLotus(R)") and suite of emerging test products
targeting the mobile health market with a primary focus on women's
fertility and hormone health, announces today its final results for
the twelve months to 31 December 2018. Concepta Plc is also
announcing today in a separate release its first myLotus(R)
pregnancies.
Operational Highlights
-- Appointment of Matthew Walls as Chairman in July 2018 and
subsequently Executive Chairman from September 2018
-- Appointment of David Darrock as Chief Operating Officer in
February 2018 with main Board appointment in September 2018
-- Appointment of Peter Dines as Non Executive Director in July
2018, replacing Mark Wyatt, to represent the largest shareholder,
Mercia Technologies PLC
-- Successful completion of UK user trials and CE Mark submission in September 2018
-- CE Mark certification received in October 2018
-- Launched myLotus(R) product at the Fertility Show, London in November 2018
-- Completed validation and ISO 13485 manufacturing approval
-- Launched the www.myLotus.com eCommerce website and listing on Amazon
Financial Overview
-- Revenue of GBP0.00m (2017 : GBP0.10m)
-- EBITDA loss GBP2.65m (2017 : GBP2.3m loss)
-- Cash at year end GBP0.74m (2017 : GBP1.5m)
-- Completion of GBP2.0m (net of expenses) share placing at 4p per share in August 2018
Post Financial Year End
-- In April 2019 Concepta completed a GBP2.2m (net of expenses)
share placing at 3p per share to accelerate business development
and to support working capital requirements
Chairman's Statement
Healthcare and personalised health is in an era of
transformational change. Recent advances in technological
innovation and online access to published medical reports and
healthcare communities is enabling patients to gain greater insight
and understanding of their health, empowering them to take control
of their wellbeing whilst easing the burden on state funded
healthcare. Concepta and the myLotus(R) , personalised diagnostic
device is at the forefront of this healthcare innovation and
change.
Following my appointment as Chairman in July 2018, I am pleased
to present my first Annual Report for the year ended 31 December
2018. The past twelve months have been definitive for the Company.
The 2018 financial year saw the successful delivery of our CE Mark
certification for the myLotus(R) product, its subsequent launch and
initial sales in the fertility monitoring and pregnancy market. In
addition, the recent announcement of the UK supply agreement with
Boots UK (part of Walgreens Boots Alliance) and the completion of
the April 2019 placing will help accelerate our business
development activities and deliver a turnaround of the Company's
prospects.
We are also announcing today the hugely important news of our
first pregnancies which are beginning to emerge from the early
adopters of myLotus(R) . Whilst brand awareness of the myLotus(R)
product is low, sales are gathering momentum and the increasingly
positive news will continue to build demand. The myLotus(R) women's
fertility monitor is unrivalled in helping women to personally
monitor their hormone cycles and ovulation profile ('signatures')
to find their most fertile days to conceive naturally.
Business Overview
The historic performance of the Company necessitated a change in
the strategy over the past year with a strengthening of the Board,
Executive and Management team. In July 2018 I joined the Board of
Concepta Plc as Chairman and Adam Reynolds who had led the
transition of Concepta onto the AIM market in 2016 moved to a
Non-Executive role. Peter Dines joined the Board as Non-Executive
Director representing our main investor (Mercia Technologies PLC).
In September 2018 David Darrock, who had been instrumental to the
delivery of the myLotus(R) product, was appointed to the Board as
Chief Operating Officer.
Whilst the historic strategy had focused on the China market,
our limited investment and arm's length management from the UK was
increasingly complex and costly. Our China launch was deferred and
resources realigned to focus on finishing the development of the
myLotus(R) product, resolving the delays in technical and app
development, completing clinical validation and gaining CE Mark
certification and regulatory approval.
Our focus and attention in the second half of 2018 was to ensure
a successful UK launch of myLotus(R) . UK sales and marketing
channels were developed across business-to-business (B2B) and
business-to-consumer (B2C) channels including Boots UK and smaller
fertility test providers, and key opinion leader support was put in
place. We developed a new myLotus(R) product website
(www.myLotus.com) and established our proprietary eCommerce
platform capable of supporting our UK business growth and future EU
and longer term international roll out. We have also adopted a
digital marketing strategy to target and engage users via social
media content, email, Amazon online shop and search engine
marketing.
CE Mark certification was confirmed in October 2018 and the
myLotus(R) product was launched in November 2018 at the Fertility
Show, Olympia London. With low brand recognition and awareness of
myLotus(R) we started the task of raising the brand profile through
user testimonials, fertility events and news coverage. Following
today's announcement we will be lifting the myLotus(R) profile and
user case studies around our first pregnancies. The marketing
message is clear - myLotus(R) increases a woman's chance of a
natural pregnancy by monitoring her ovulation profile, finding her
most fertile days and optimal time to conceive. A key requirement
for the myLotus(R) pregnancy journey was the delivery of our first
app developed in iOS/Android formats enabling women to track their
hormone levels over their menstrual cycle. The development of our
free app was completed in October 2018 and launched together with
the myLotus(R) monitor.
Supply chain operations and logistics continued to strengthen
throughout the year. The Doncaster manufacturing and assembly
facility received ISO 13485 approval in September 2018 and the
scale up and efficiency of production of our myLotus(R) monitor
continues to improve with a second monitor manufacturer now
identified. We will maintain our focus on a continuous improvement
and cost reduction in the manufacturing processes to improve our
margins. Working capital requirements also continued to build over
the year and this trend is expected to continue through 2019.
Over the past few months strategic and distributor discussions
have commenced with larger diagnostic and retail pharmacy groups.
The discussions are expected to deliver further collaborative
opportunities in 2019.
We are also exploring applications for myLotus(R) in hospitals
and IVF (In Vitro Fertilisation) fertility clinics. The opportunity
for myLotus(R) to carve out a new strategic position in the
'pathway to pregnancy' is compelling. According to the US
BabyCentre Medical Advisory Board, clinical evidence indicates that
93-95% of women aged below 35 years who have regular unprotected
sex will naturally fall pregnant over a 4 year period (48 cycles).
myLotus(R) will help women identify their fertile days and optimal
time to conceive thereby helping to accelerate the natural
pregnancy process. myLotus(R) is especially relevant with the
reduction in state funded fertility support enabling couples a
lower cost alternative prior to considering more costly IVF
treatment.
Product development
Development of the myLotus(R) product includes the core areas of
the myLotus(R) monitor and immunodiagnostic tests, iOS/Android app
and data monitoring. Each of these areas have ongoing developments
and we will continue to build our internal expertise to accelerate
these programmes. The myLotus(R) monitor will be improved to
include Bluetooth capability and enhanced display. We will be
developing the myLotus(R) test menu to widen our test coverage of
the menstrual cycle by including new hormone tests for Follicle
Stimulating Hormone (FSH) and progesterone. These tests will both
improve our fertility monitoring and extend the window on the
menstrual cycle to include coverage of menopause. We will also
continue to grow our user database to provide improved diagnosis of
women's hormone health, wellbeing and diagnostic predictive
analysis.
Financial Overview
Further details of the results for the period are covered in the
Financial Report, but financially the year to 31 December 2018 saw
the Company deliver income of GBP0.0m (2017: GBP0.1m). Following
high levels of investment made in the development of myLotus(R) ,
the Company reported a loss after tax of GBP2.8m (2017: GBP2.3m
loss after tax) and a loss per share of GBP0.02 (2017:
GBP0.02).
In August 2018 the Company completed a GBP2.0m placing to finish
the development of myLotus(R) . Cash reserves at 31 December 2018
were GBP0.7m (2017: GBP1.5m.)
In April 2019 Concepta completed a GBP2.2m placing net of
expenses to accelerate business development and to support working
capital requirements.
Outlook
The market opportunity for myLotus(R) in fertility, pregnancy
and women's health is substantial and with limited direct
competition, the Board believes Concepta has strong prospects for
growth. We are at the early stages of our product launch and
program build and we will continue to educate users on the value of
myLotus(R) , raise brand awareness and bolster our sales and
marketing expertise over the coming year.
Our priority for 2019 is to develop our UK sales channels in B2C
and B2B and engage a sustainable growth model which we can extend
across the EU. We will also develop our strategic relationships
with large diagnostic groups capable of internationally exploiting
our diagnostic platform across personalised health and
wellbeing.
We will accelerate the development of our additional test menu
for myLotus(R) to target a broader women's hormone health product
and to achieve the following key objectives:
-- Development of a sustainable revenue growth model
-- EU roll-out to take advantage of our CE Mark approval and eCommerce platform capability
-- Development of our collaboration with Boots UK and the Walgreens Boots Alliance
-- Piloting of myLotus(R) for use in IVF
-- Piloting of myLotus(R) fertility and pregnancy support journey
-- Bluetooth capability and improved display
-- Development of new hormone tests
-- App version 2.0 development
-- Development of data mining tools and diagnostic predictive analytics capability
Based on our increasing pregnancies and user testimonials, we
expect to raise the profile of myLotus(R) over the coming year and
take advantage of our new technology innovation and industry
know-how to drive our growth strategy.
I would like to thank the Board, management team and employees
for their effort and commitment in driving Concepta's progress over
the past year, as well as our investors whose support has provided
a stable platform for our continued growth plans.
Matthew Walls
Chairman
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Year ended Year ended
31 December 31 December
2018 2017
Notes GBP GBP
--------------------------------- ------ ------------ ------------
Revenue 4 4,838 108,115
Cost of sales (540,721) (519,522)
Gross loss (535,883) (411,407)
Other administrative expenses (2,213,695) (1,925,482)
Share-based payments (92,291) (109,523)
--------------------------------- ------ ------------ ------------
Administrative expenses (2,305,986) (2,035,005)
--------------------------------- ------ ------------ ------------
Operating loss 5 (2,841,869) (2,446,412)
Finance expenses 7 (23,915) (3,355)
--------------------------------- ------ ------------ ------------
Loss before income tax (2,865,784) (2,449,767)
Tax credit 8 52,277 104,818
Loss for the period (2,813,507) (2,344,949)
--------------------------------- ------ ------------ ------------
Attributable to owners of the
parent: (2,813,507) (2,344,949)
Loss per ordinary share - basic
and diluted (GBP) 9 (0.02) (0.02)
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
31 December 31 December
2018 2017
Notes GBP GBP
------------------------------- ------ ------------ ------------
Non-current assets
Property, plant and equipment 10 789,189 473,247
Intangible assets 11 509,195 390,743
Total non-current assets 1,298,384 863,990
------------------------------- ------ ------------ ------------
Current assets
Inventories 12 399,182 296,548
Trade and other receivables 13 164,933 678,236
Corporation tax receivable 52,277 104,818
Cash and cash equivalents 14 740,227 1,537,759
------------------------------- ------ ------------ ------------
Total current assets 1,356,619 2,617,361
------------------------------- ------ ------------ ------------
Total assets 2,655,003 3,481,351
------------------------------- ------ ------------ ------------
Current liabilities
Trade and other payables 15 259,681 462,895
Loans and borrowings 16 64,228 16,211
Total current liabilities 323,909 479,106
------------------------------- ------ ------------ ------------
Non-current liabilities
Loans and borrowings 16 227,243 62,310
------------------------------- ------ ------------ ------------
Total non-current liabilities 227,243 62,310
------------------------------- ------ ------------ ------------
Total liabilities 551,152 541,416
------------------------------- ------ ------------ ------------
Net assets 2,103,851 2,939,935
------------------------------- ------ ------------ ------------
Share capital 17 4,704,917 3,454,917
Share premium account 17 10,448,263 9,813,131
Share-based payment reserve 19 743,178 650,887
Capital redemption reserve 1,814,674 1,814,674
Reverse acquisition reserve (6,044,192) (6,044,192)
Retained earnings (9,562,989) (6,749,482)
------------------------------- ------ ------------ ------------
Total equity 2,103,851 2,939,935
------------------------------- ------ ------------ ------------
These financial statements were approved and authorised for
issue by the board of directors on 13 May 2019
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Capital Reverse Share-based
Share Share redemption Retained acquisition payment
capital Premium reserve earnings reserve reserve Total
GBP GBP GBP GBP GBP GBP GBP
--------------------- ---------- ----------- ------------- ------------ ------------- ------------ ------------
Equity as at
31 December 2016 2,740,631 8,663,326 1,814,674 (4,404,533) (6,044,192) 541,364 3,311,270
Loss for the
period (2,344,949) (2,344,949)
--------------------- ---------- ----------- ------------- ------------ ------------- ------------ ------------
Total
comprehensive
loss - - - (2,344,949) - - (2,344,949)
Issue of shares
net of expenses 714,286 1,149,805 - - - - 1,864,091
Share-based payments - - - - - 109,523 109,523
Equity as at
31 December 2017 3,454,917 9,813,131 1,814,674 (6,749,482) (6,044,192) 650,887 2,939,935
Loss for the
period - - - (2,813,507) - - (2,813,507)
--------------------- ---------- ----------- ------------- ------------ ------------- ------------ ------------
Total
comprehensive
loss - - - (2,813,507) - - (2,813,507)
Issue of shares
net of expenses 1,250,000 635,132 - - - - 1,885,132
Share-based payments - - - - - 92,291 92,291
--------------------- ---------- ----------- ------------- ------------ ------------- ------------ ------------
Equity as at
31 December 2018 4,704,917 10,448,263 1,814,674 (9,562,989) (6,044,192) 743,178 2,103,851
--------------------- ---------- ----------- ------------- ------------ ------------- ------------ ------------
CONSOLIDATED STATEMENT OF CASH FLOWS
Year ended Year ended
31 December 31 December
2018 2017
GBP GBP
------------------------------------------ ------------ ------------
Cash flows from operating activities
Loss before taxation (2,865,784) (2,449,767)
Adjustments for:
Depreciation and amortization 192,260 209,228
Finance expenses 23,915 3,355
Share-based payments 92,291 109,523
------------------------------------------ ------------ ------------
Operating loss before working capital
changes (2,557,318) (2,127,661)
Changes in working capital
Increase in inventory (102,634) (226,047)
Decrease/(increase) in trade and
other receivables 513,302 (463,134)
(Increase)/Decrease in trade and
other payables (203,213) 280,937
------------------------------------------ ------------ ------------
Cash used in operations (2,349,863) (2,535,905)
Tax received 104,818 96,221
Interest paid on sale & leaseback (21,415) (1,142)
Other interests (2,500) (784)
------------------------------------------ ------------ ------------
Net cash outflow from operating
activities (2,268,960) (2,441,610)
------------------------------------------ ------------ ------------
Investing activities
Purchase of property, plant and
equipment (457,836) (430,033)
Purchase of intangible assets (169,560) (240,259)
Sale of asset 742 -
------------------------------------------ ------------ ------------
Net cash flows used in investing
activities (626,654) (670,292)
------------------------------------------ ------------ ------------
Financing activities
Issue of ordinary shares (net of
issue expenses) 1,885,132 1,864,091
Proceeds from sale and leaseback 381,215 118,000
Repayment of sale and leaseback (168,265) (40,907)
Net cash flows from financing activities 2,098,082 1,941,184
------------------------------------------ ------------ ------------
Net change in cash and cash equivalents (797,532) (1,170,718)
Cash and cash equivalents at the
beginning of the period 1,537,759 2,708,477
------------------------------------------ ------------ ------------
Cash and cash equivalents at the
end of the period 740,227 1,537,759
------------------------------------------ ------------ ------------
Notes to the preliminary financial results
1. The figures for the years ended 31 December 2018 and 2017 do
not constitute statutory accounts within the meaning of Section 434
of the Companies Act 2006. The figures for the year ended 31
December 2018 have been extracted from the statutory accounts for
that year on which the auditor has issued an unqualified audit
report which has yet to be delivered to the Registrar of Companies.
The figures for the year ended 31 December 2017 have been extracted
from the statutory accounts for that year which have been delivered
to the Registrar of Companies and on which the auditor has issued
an unqualified audit report. No statement has been made by the
auditor under Section 498(2) or (3) of the Companies Act 2006 in
respect of either of these sets of accounts. This announcement was
approved by the board of directors on 13 May 2019 and authorised
for issue on 14 May 2019.
2. The consolidated financial statements have been prepared in
accordance with International Financial Reporting Standards adopted
by the International Accounting Standards Board ('IASB') and
interpretations issued by the International Financial Reporting
Interpretations Committee of the IASB (together 'IFRS') as endorsed
by the European Union. The information in this preliminary
statement has been extracted from the audited financial statements
for the year ended 31 December 2018 and as such, does not contain
all the information required to be disclosed in the financial
statements prepared in accordance with the International Financial
Reporting Standards ('IFRS').
3. Earnings per share is based on the loss for the year after
tax of GBP2,813,507 (2017: GBP2,344,949), and the weighted average
number of ordinary shares in issue during the year of 158,321,675
(2017: 112,564,863). Due to the loss in the periods the effect of
the share options was considered anti-dilutive and hence no diluted
loss per share information has been provided.
The 2018 Annual Report and Accounts will be available to
download from the investor relations section on the Company's
website www.conceptaplc.com
**ENDS**
Enquiries:
The Company
Matthew Walls, Chairman
Tel: +44 (0) 1234 866601
SPARK Advisory Partners Limited (Nomad)
Neil Baldwin / Mark Brady
Tel: +44 (0)20 368 3550
Novum Securities
Colin Rowbury
+44 (0) 20 7399 9400
About Concepta Plc:
Concepta Plc is an AIM-quoted pioneering UK healthcare company
that has developed a proprietary product, myLotus(R), targeted at
the personalised mobile health market with a primary focus on
hormone testing and increasing a woman's chances of naturally
getting pregnant and to provide insight to unexplained
infertility.
myLotus(R) is currently the only consumer product which allows
both quantitative and qualitative home (self-test) test measurement
of a woman's personal luteinizing hormone (LH) during ovulation and
human chorionic gonadotropin (hCG) hormone level during pregnancy,
facilitating higher conception rates and early diagnosis of
fertility issues. The proposition of myLotus(R) is to empower women
to better understand their hormone levels and menstrual cycle and
help women conceive naturally by identifying their window of
fertility and optimal time for conception.
The Company has received CE Mark certification for myLotus(R)
and has launched its first product in the UK. The Company is
preparing plans to roll-out across the core EU countries in
2019.
myLotus(R) is expected to be beneficial to users who have been
unable to conceive after 6 months of trying. This highly motivated
target group of women won't typically be offered medical
intervention until after 12 months of unsuccessfully trying to
conceive, with IVF not usually offered until after two years of
trying to conceive. Research indicates couples start to take
positive action ahead of this time typically with little medical
support to help them do so.
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
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