TIDMNFX
RNS Number : 2873F
Nuformix PLC
15 July 2021
15 July 2021
Nuformix plc
("Nuformix" or the "Company" or the "Group")
Final results for the year ended 31 March 2021
Nuformix plc (LSE: NFX ), a pharmaceutical development company
targeting unmet medical needs in fibrosis and oncology via drug
repurposing to provide enhanced benefit, announces its audited
results for the year ended 31 March 2021.
Highlights
-- Net assets at year-end of GBP5,686,261 (2020: GBP4,742,520)
which includes GBP1,669,780 cash at bank as at 31 March 2021 (31
March 2020: GBP543,772)
-- The Group delivered a loss on ordinary activities (after tax
credit) of GBP1,253,497 (2020: loss of GBP756,376) and a loss per
share of 0.22p (2020: 0.16p). The reported loss is driven mainly by
costs related to the further development of pipeline assets
-- Total revenue of GBP195,550 (2020: GBP535,000)
-- Successful equity fundraises of GBP1.565m and GBP0.65m, both
before expenses, completed in March 2021 and October 2020
respectively - funds being used to advance and exploit the current
assets within the portfolio, focussing on R&D activities for
NXP002 and NXP004
-- Exercise of option by Oxilio in March 2021 to acquire a
licence for NXP001 to allow them to develop NXP001 for oncology -
both parties continuing to work together to finalise a global
licensing agreement
-- Strengthening of the board through the appointments of Dr
Anne Brindley as Chief Executive Officer and Dr Julian Gilbert and
Maddy Kennedy as Non-Executive Directors adding significant
industry and financial experience to the Board and, post period
end, appointment of Dr Alastair Riddell as Non-Executive
Chairman
Dr Anne Brindley, Chief Executive Officer, said: "Our ambition
is to repurpose existing, marketed drugs, with improved physical
properties in order to develop novel products in new indications to
create attractive commercial opportunities. The successful
fundraises during the year are enabling us to perform further
R&D on our proprietary assets, focussing on NXP002 and NXP004,
which will allow us to move to the next stage of growth and value
creation for the Company. As we continue to execute on our
strategy, we are building momentum with the ultimate aim of
delivering value to shareholders."
Dr Alastair Riddell, Non-Executive Chairman, said: "It is an
exciting period for Nuformix and I am very pleased to have been
recently appointed as Non-Executive Chairman to serve the Group.
This has been a year of change and progression for the Company and
its leadership. The team remains energised by the potential of our
pipeline and business strategy to address the devastating and
typically progressive disease burden associated with fibrosis and
oncology.
"We remain highly encouraged by the outlook for the business and
look forward to providing further updates as we execute on our
strategy."
Enquiries:
Nuformix plc +44 (0)1223 627222
Dr Anne Brindley, CEO
Allenby Capital Limited +44 (0)203 328 5656
Nick Athanas / George Payne (Corporate
Finance)
Stefano Aquilino / Matt Butlin (Sales
and Corporate Broking )
Walbrook PR +44 (0)207 933 8780
Anna Dunphy / Paul McManus / Kiki Zaccagnini or nuformix@walbrookpr.com
About Nuformix
Nuformix is a pharmaceutical development company targeting unmet
medical needs in fibrosis and oncology via drug repurposing. The
Company aims to use its expertise in discovering, developing and
patenting novel drug forms, with improved physical properties, to
develop new products in new indications that are, importantly,
differentiated from the original (by way of dosage, delivery route
or presentation), thus creating new and attractive commercial
opportunities. Nuformix has an early-stage pipeline of preclinical
and Phase 1-ready assets with potential for significant value and
early licensing opportunities.
Nuformix plc shares are traded on the London Stock Exchange's
Official List under the ticker: NFX.
For more information, please visit www.nuformix.com .
References to page numbers and notes to the accounts made in
this section refer to page numbers and notes to the accounts in the
Company's 2021 Annual Report.
Chairman's Statement
Introduction
I am delighted to write my first statement as Chairman having
recently joined Nuformix in May 2021. This has been a year of
change and progression for the Company and its leadership. At the
end of 2020, the team was enhanced with the appointment of Dr Anne
Brindley as CEO and Executive Director of the Company and this
followed the earlier appointments of two Non-Executive Directors in
November and December, respectively, of Dr Julian Gilbert and Ms.
Madeleine Kennedy. A key priority for the Group was to establish
strength in the areas of drug development, business development and
financial control and with these key appointments we can now look
forward to driving the value we all see in Nuformix. In February
2021 Dr Chris Blackwell resigned as Non-Executive Chairman for
personal reasons and post period in May 2021 further Board changes
were announced confirming Dr Karl Keegan's resignation to focus on
his other executive role and Dr Joanne Holland resigned as a
Director and employee of the Company from the end of May 2021 in
order to pursue other opportunities. Jo remains as a consultant to
Nuformix to advise, in particular, on solid form science and
patenting.
In December 2020, the Company was pleased to announce the
appointment of Allenby Capital Limited as the Company's sole
broker, providing access for Nuformix to a broad spectrum of
investors including institutional investors, family offices,
private client brokers and high net worth individuals. The
appointment of Allenby also brought, for the first time, initiation
of research for the Company.
In the period, the Company completed two equity fundraises of
GBP0.65m, before expenses in October 2020 and GBP1.56m, before
expenses in March 2021 and these funds are being used to continue
to advance and exploit the current assets within the portfolio.
These raises enable the foundation of the Company's strategic aims
under the new leadership that has been established over the last 9
months.
The Group currently has three assets in its pipeline with a
focus in fibrosis and oncology and more detail is given in the CEO
statement. This is an early-stage pipeline of preclinical and Phase
1-ready assets with potential for significant value and early
licensing opportunities and our focus is now to take each of our
assets to key value inflection points before partnering or
licensing. The Group conducts its R&D via a fully virtual
operating model, outsourcing to a network of external contractors
(CROs, consultants) with whom the company has long-standing
relationships. This lean model helps minimise the cost base and
prioritise use of funds for project activities.
I am delighted to be able to join Nuformix at this exciting time
in its history as it develops its portfolio of new versions of
established products for new and important therapeutic indications
and I look forward to helping the Group progress these
opportunities to value creation for shareholders in the next few
years. I recognise there has been a series of changes over the
years and what is needed now is stability and growth. I feel there
is real optimism and commitment in the new team to progress our
products to significant value creation, helped by the recent fund
raise, which puts the company on a solid foundation. From my
perspective the company has the strategic skills and expertise to
reduce development risk with its portfolio of products and a plan
to achieve considerable commercial interest in the next few years
and thus generate real return for shareholders.
On behalf of the Board, I would like to thank all stakeholders
and shareholders for their support and I look forward to the next
year with optimism.
Dr Alastair Riddell
Non-Executive Chairman
14 July 2021
Chief Executive Officer's Statement
Overview
At Nuformix, we are targeting high unmet medical needs in
fibrosis and oncology via drug repurposing. We do this through
using our expertise to discover, develop and file patent
applications on novel drug forms of existing, marketed drugs, that
have improved physical properties, with the aim of developing novel
products in new indications to bring attractive commercial
opportunities. Importantly, the commercial opportunity is optimised
when the repurposed product is differentiated from the original
marketed drug by way of either dose, route of administration or
presentation. Although we specialise in fibrosis and oncology, our
repurposing technology and know-how can be universally applied to
any therapy area.
Drug repurposing is a well-known and successful strategy for
enhancing the therapeutic and commercial value of marketed drugs,
and their development typically brings a greater probability of
success compared to developing brand new drugs, due to the existing
data that has been generated on the marketed drug. This existence
of data may also result in lower overall development costs and
shorter development timelines.
Nuformix has an early-stage pipeline of preclinical and Phase
1-ready assets with potential for significant value and early
licensing opportunities. Our lead programme is NXP002 and is in the
pre-clinical stage of development. It is a new form of the drug
tranilast, that we are developing as an inhaled product to address
unmet needs in Idiopathic Pulmonary Fibrosis (IPF). The other
portfolio assets are targeted towards oncology and are NXP001, in
the Phase 1-ready stage and NXP004 in the research phase. The
Group's business model is to take these assets to key value
inflection points before partnering or licensing. We conduct all
our R&D activities through out-sourcing, to enable us to access
the different types of expertise that are needed for drug R&D
and to minimise our operational costs. We have a strong-network of
external contractors, with whom we have had relationships over many
years.
Pipeline
NXP002 (new form of tranilast) - Idiopathic Pulmonary Fibrosis
(IPF)
NXP002 is the Group's pre-clinical lead asset and a potential
novel inhaled treatment for IPF. It is a proprietary, new form of
the drug tranilast, to be delivered in an inhaled formulation. IPF
is a devastating lung disease associated with a higher mortality
rate than many cancers and where there is a need for additional
treatment options. Thus IPF represents a high unmet medical need
and a significant commercial opportunity. Tranilast has a long
history of safe use as an oral drug for allergies but there is
evidence that supports its potential in fibrosis, including IPF.
NXP002 is differentiated as it is a new form of tranilast that is
being formulated for delivery direct to the lungs by inhalation, a
new route of administration for this drug. The inhalation route is
a well-known strategy for treatment of lung diseases to yield
greater efficacy and reduce systemic side-effects compared to oral
treatment. Nuformix has filed two patent applications on new forms
of tranilast, one of which is granted globally and a second, which
is at an earlier stage in its examination, for which, post period,
we received a Notice of Allowance in the US. NXP002, as a potential
treatment for IPF, is a likely candidate for Orphan Drug
Designation which could provide additional product protection
against potential competitors. The positioning of such an inhaled
treatment for IPF could be either added to standard of care or
administered as a monotherapy.
The Group has undertaken preclinical studies, through its
continued collaboration with the Newcastle Fibrosis Research Group
(a multi-disciplinary research group at Newcastle University, UK),
to determine the ability of NXP002 to inhibit key markers of
fibrosis and inflammation in a preclinical model utilising human
lung slices taken from IPF patients post-lung transplant. These
studies have yielded positive data underpinning the potential of
NXP002 as an IPF treatment, including potential for use in
combination with Standard of Care therapy and data generated
support continuing to develop this asset. The raising of GBP1.56
million, before expenses, in March 2021 will fund the continued
preclinical development of NXP002 to generate a more robust data
package with the goal of increasing the value of this asset and
rendering it more attractive to licensing partners. The funds
raised will enable the Company to determine the feasibility of
NXP002 as an inhaled formulation. Post-fund raise (and
post-period), work has commenced on manufacturing further supplies
of NXP002 to be used in formulation development activities,
nebulisation feasibility studies and in vivo studies. In addition,
contracts are in place for and work is ongoing on a programme of
preclinical pharmacokinetic and pharmacodynamic studies in relevant
in vivo models designed to demonstrate that NXP002 has appropriate
properties for use as an inhaled therapy for IPF. These studies,
once complete, will collectively form an inhalation feasibility
package, referred to as the first inflection point in the future
development plan for NXP002. If positive data are generated, this
package may be used as a platform for further business development
and licensing discussions with suitable globally focused partners
(pharma companies, biotech).
Although business development discussions in Asia have taken
place during the period, the Group's strategy, to maximise the
value of this asset, is to generate a more robust preclinical data
package for NXP002, to provide a more attractive licensing package
to facilitate a structured out-licensing approach to include all
territories.
NXP001 (new form of aprepitant) - Oncology
NXP001 is a proprietary new form of the drug aprepitant that is
currently marketed as a product in the oncology supportive care
setting (chemotherapy induced nausea and vomiting). A disadvantage
of aprepitant is that its sub-optimal properties necessitate a
complex formulation. The Group has discovered new forms of
aprepitant (NXP001) with improved properties and it has granted
patents on its new forms. Literature data suggests that aprepitant
could have benefits in oncology, i.e., beyond the currently
marketed indications.
To date, the Group has conducted preclinical studies and a Phase
1 study, which demonstrated bioavailability of NXP001, similar to
the marketed product but without requiring a complex formulation.
Further refinement of the formulation will be required ahead of
initiating any future Phase 1 studies.
On 23 September 2020, Oxilio, a privately held pharmaceutical
development company, was granted a 6-month option to license NXP001
globally for repurposing in oncology. On 23 March 2021 Oxilio
exercised the option and a global license deal is under
negotiation. Once agreed, Nuformix will license its patent estate
and know-how on NXP001 in return for an upfront payment,
development milestones and a royalty on net sales, capped at GBP2
million per annum.
NXP004 (new forms of undisclosed drug) - Oncology
The Group has discovered novel forms of an undisclosed marketed
oncology drug that has significant sales (more than GBP1 billion
per annum in 2020) and is showing further growth. The Group has
filed one patent application on these novel forms and post-fund
raise, further research on other new forms and their properties is
ongoing. Should the data from this further research warrant it, the
Group may file an additional patent application and, if the patent
applications on these new forms are granted, there is potential for
patent expiry to extend to 2040/2041. Further research is ongoing
and if it is positive, the Group will seek to license NXP004 to the
originator of the marketed drug to potentially extend their patent
protection, thus potentially adding significant value for the
originator.
While there is literature data and preliminary preclinical data
generated by the Group providing evidence for this drug's potential
activity in fibrosis, it is the Group's strategy that in order to
derive most value from the NXP004 asset, the opportunities in
oncology (the original marketed indication) should be exploited as
a priority.
Capital
The success of the two fundraises in the year will enable us to
continue to advance and exploit the current assets within the
portfolio through additional R&D and business development
activities as set out above. R&D studies are actively
continuing on both NXP002 and NXP004, while business development
activities are focused on securing the license agreement for
NXP001.
The Group is also continuing to seek non-dilutive grant funding
for its early-stage assets that, if successful, will enable further
investment in the Group's pipeline to accelerate development. The
Group applied for an Innovate UK Smart Award grant in January 2021
and, due to the highly competitive nature of these grants, it was,
unfortunately, unsuccessful. However, post-period we have
re-submitted the application, taking into account feedback and the
outcome is expected in Q3, 2021.
Current prospects and outlook
The current strategy of the Group is to optimise value from its
existing assets while maintaining tight control of costs. The Group
plans to achieve this by progressing activities on its three
priorities:
- progressing further preclinical work on its lead asset,
NXP002, to deliver a more robust data package to potentially
increase this asset's value and attractiveness to
partners/licensees. Should the data be positive, this would
facilitate further licensing or partnering activities;
- pursuing licensing of NXP001; and
- conducting further research/patent application filing on
NXP004 to provide a potential IP licensing opportunity.
At the appropriate time for each asset, the Group plans to
conduct business development / licensing activities for all three
assets using a structured and data-driven approach, with the goal
of seeking global licensing deals.
The past year has been one of significant re-focus for the
Group. Including post-period events, the Board and Executive
Management has completely changed and I believe we have a strong
leadership in place to take the company forward. However, we have
ensured that, despite these changes, we have retained continuity
and expertise and I am pleased that Dr Joanne Holland, who resigned
post-period and was a co-founder of Nuformix and CSO for many
years, is remaining as a consultant to the Group to provide
expertise on solid form science and patenting as needed.
Finally, on behalf of the Board, I am grateful to all our
shareholders for their patience as the new leadership reshapes the
company to deliver on its new strategy and I would like to
sincerely thank all of you for your ongoing support.
Dr Anne Brindley
Chief Executive Officer
14 July 2021
Strategic Report
Risks and uncertainties
The Group's risk management policy is regularly reviewed and
updated in line with the changing needs of the business. Risk is
inherent in all business. Set out below are certain risk factors
which could have an impact on the Group's long-term performance and
mitigating factors adopted to alleviate these risks. This does not
purport to be an exhaustive list of the risks affecting the
Group.
The primary risks identi ed by the Board are:
Strategic risks
-- Funding the business
o Potential impact and mitigation:
The biotechnology and pharmaceutical industries are very
competitive, with many major players having substantial R&D
departments with greater resources and nancial support. The Group
aims to execute licensing deals early in the development process in
order to generate revenue to support the business. The Group's lead
asset is targeted towards IPF, a disease area where there is good
precedent for licensing deals at early stages of development.
Without licensing revenue, reliance falls on raising funds from
investors or potential M&A opportunities. Failure to generate
additional funding from these sources, if required, would
compromise the Group's ability to achieve its strategic objectives
as set out in the outlook on page 9. There is a material
uncertainty around achieving early licensing deals and, if needed,
raising additional funds, however it is the Directors' reasonable
expectation that the Group has adequate resources to continue to
operate as a going concern for at least twelve months from the date
of the approval of the accounts. In forming this assessment, the
Directors have prepared cash ow forecasts covering the period
ending 31 March 2023 that take into account the likely run rate on
overheads and research and development expenditure and the prudent
expectations of income from out-licensing rights to its
programmes.
-- Feasibility of drug candidates
o Potential impact and mitigation:
Pharmaceutical R&D is an inherently risky activity and drug
candidates can fail due to a lack of ef cacy, lack of potency,
unsuitable pharmacokinetic properties, unacceptable toxicology
profile, poor stability of the drug or formulation, poor
performance of the drug product, or other technical issues
unforeseen at the time of candidate selection. This is the main
reason that conventional pharmaceutical R&D takes many years
and billions of dollars to progress a drug from discovery through
to an approved medicine. It is possible that the drug candidates
selected by the Group are found to be non- viable for further
development although the Group's model of repurposing and working
on known drugs allows us to mitigate this risk to a certain
extent.
-- Failure to generate and protect our IP
o Potential impact and mitigation:
If our IP rights are not adequately secured or defended against
infringement, or conversely become subject to infringement claims
by others, commercial exploitation could be completely inhibited.
The Group constantly monitors its patents and is prepared to defend
them rigorously.
By virtue of conducting research on known drugs, competitors may
file patent applications on the same drugs as the Group, and thus
there is a risk of securing new granted patents. There is a delay
of up to 18 months in publishing patent applications and thus it is
not always known whether the Group's inventions will be novel. This
is mitigated through knowledge and expertise in identifying new IP
and promptly filing patent applications.
-- Unrealistic goals and timeframes
o The Group's executive management has a duty to the Board and
the Group's shareholders to maintain a realistic view of the
chances of success of products, deals and partnerships. Should this
not be managed accurately and appropriately, the Group and its
Board and staff risk nancial, business and reputational damage,
whilst its shareholders become exposed to investment risk and
uncertainty over the Group's viability and status. The Board
continually reviews executive management's expectations and
communications in the public domain to reduce the risk of
misalignment.
-- Reliance on partners
o Potential impact and mitigation:
To progress the development of a drug candidate requires
resources, nancial and otherwise, that are not necessarily
available to the Group. The drug candidates that the Group wishes
to develop may be of interest to third parties capable of providing
these resources, so a partnership (e.g., a co-development
partnership) may provide mutual bene ts and mitigate risks for the
Group. However, the speci c strategic focus of a partner may not
align totally with the Group's objectives. Maintaining a balance in
a partnership is therefore a risk, such as timing, cost sharing,
development decisions. Currently the Group is progressing its 3
pipeline assets without external co-development partners and thus
this risk is currently minimised.
Operational risks
-- Management and employees
o Potential impact and mitigation:
With a fully virtual Group operating model with few employees,
the Group's ability to manage day to day tasks and its
relationships with its customers and suppliers could be undermined
by failure to retain or recruit key Executives or employees. The
Group endeavours to offer attractive remuneration and a positive
working environment for staff. Board Directors are incentivised as
detailed in the Directors' Remuneration Report.
-- Business development risks in terms of timing and success of deal ow
o Potential impact and mitigation:
Opportunities to generate value from the portfolio have
increased but there is a need to generate further data to make the
assets as attractive as possible to potential licensees. The Group
seeks to extract value from its existing pipeline through early
licensing deals once sufficient data are generated, to provide
revenue. Generation of more robust data packages will lead to a
greater probability of successful licensing discussions.
-- Adapting to the external environment - COVID-19
o Potential impact and mitigation:
The ability of the Group to quickly adapt to external events
such as the outbreak of COVID-19 may impact the delivery of our
strategy. The pandemic could cause further impact to external
research. Our primary focus remains the safety of our employees.
The Group follows Government advice whilst allowing employees to
work exibly. The risks are also minimised by the Group's virtual
business model, allowing the Executive management and Board to work
remotely and effectively. Close liaison with contractors ensures
that Group projects are progressed according to agreed timelines
and costs.
-- UK's departure from European Union ("Brexit")
The impact of the UK's departure from the European Union is not
yet clear but it may signi cantly affect the scal, monetary and
regulatory landscape in the UK, and could have a material impact on
the UK's economy and the future growth of its industries, including
the pharmaceutical and biotechnology industries. Depending on the
free trade agreement terms negotiated between EU Member States and
the UK following Brexit, the UK could lose access to the single
European Union market and to the global trade deals negotiated by
the European Union on behalf of its members. Although it is not
possible at this point in time to predict fully the effects of the
free trade agreement with the European Union, it could have a
material adverse effect on the Group's business, nancial condition
and results of operations. In addition, it may impact the Group's
ability to comply with the extensive government regulation to which
it is subject and impact the regulatory approval processes for its
product candidates. This is an area the Executive Management
monitors closely.
Financial risk management
-- Failure to achieve strategic plans or meet targets or expectations
o Potential impact and mitigation:
The Group actively and regularly reviews and manages its capital
structure to ensure an optimal capital structure and equity holder
returns, taking into consideration the future capital requirements
of the Group and capital ef ciency, prevailing and projected pro
tability, projected operating cash ows, projected capital
expenditures and projected strategic investment opportunities.
Further detail on the Group's risk management policies and
procedures are set out in Note 22 of the nancial statements.
Financial Highlights
-- Net assets at year-end of GBP5,686,261 (2020: GBP4,742,520)
which includes GBP1,669,780 cash at bank (2020: GBP543,772)
-- The Group delivered a loss on ordinary activities (after tax
credit) of GBP1,253,497 (2020: loss of GBP756,376) and a loss per
share of 0.22p (2020: 0.16p). The reported loss is driven mainly by
costs related to the further development of pipeline assets
-- Total revenue of GBP195,550 (2020: GBP535,000)
Future outlook
The Chief Executive Officer's Statement on pages 7 to 10 gives
information on the outlook of the Group.
Performance
The following are the key performance indicators ("KPIs")
considered by the Board in assessing the Group's performance
against its objectives. These KPIs are:
Financial KPIs
The Group is currently at a stage where the Board considers
availability of cash to fund the planned R&D activities to be
the primary KPI. At 31 March 2021 cash balances totalled
GBP1,669,780 (2020: GBP543,772). The Board will consider
introducing additional KPIs to monitor the Group's development as
they become relevant in the future.
-- Meeting nancial targets:
The Group actively and regularly reviews and manages its capital
structure to ensure an optimal capital structure and equity holder
returns, taking into consideration the future capital requirements
of the Group and capital ef ciency, prevailing and projected pro
tability, projected operating cash ows, projected capital
expenditures and projected strategic investment opportunities.
Further detail on the Group's risk management policies and
procedures are set out in Note 22 of the nancial statements.
-- Revenue from collaborative technology licensing agreements:
During the year, collaborative agreements with third parties
entailed providing fee-for-service work and applying Nuformix know
how to their proprietary products. This has provided Nuformix with
limited short-term revenue streams.
During the year, collaborations / fee for service work was
completed with Ebers Tech Inc. and Vistagen Inc. However, the
future Group strategy is to prioritise its resources on progressing
its own portfolio to generate licensing revenue.
Non-Financial KPIs
-- Progress of Lead Programmes:
The Group strategy is to generate revenue streams through
applying and further developing its IP to produce proprietary
product opportunities for short-term development and early
out-licensing opportunities. Thus, progression of its assets
towards licensing is crucial to the business.
NXP002: During the year the Group prioritised the development of
NXP002, its IPF candidate, and generated further preclinical data.
Post-period, studies are ongoing to provide a more robust data
package for potential early licensing. Progression of the planned
R&D and potential licensing discussions (if the data are
positive) are important performance indicators.
NXP001: Following successful completion of initial Phase 1
studies of this new form of aprepitant, the Group secured an Option
agreement with Oxilio to license the IP for oncology indications.
Securing the full licensing agreement is an important performance
indicator.
NXP004: During the year, the Group discovered new forms of an
undisclosed oncology drug and has filed one patent application.
Further research is ongoing and completing this and potentially
filing a further patent application is an important performance
indicator. The Group also performed pre-clinical pilot studies to
investigate the potential of this drug as a treatment for brosis
with Newcastle Fibrosis Research Group (NFRG). However, it is the
opinion of the Group that the priority is to evaluate the
opportunity in oncology as an improved version of the existing
drug.
-- Co-development with third parties:
Co-development of generic products with third parties, where
Nuformix's know how or IP could provide extended patent protection
is a potential business model although the Group is prioritising
its resources on progressing its own portfolio to generate
licensing revenue.
Section 172
The Board considers the interests of the Group's employees and
other stakeholders, including the impact of its activities on the
community, environment and the Group's reputation, when making
decisions. The Board ensures that its decisions offer the best
chance to promote the success of the Group as a whole and consider
the likely and long-term consequences for all stakeholders,
particularly (though not exclusively) considering the
following:
-- How the views and interests of all stakeholders were
represented in the boardroom during the year. Open and honest
discussion at Board level between management and the Directors
considers the impact on the Group's stakeholders when reviewing
items owing to the Board as part of its activities, whether this is
reviewing strategy, budget or a business development
opportunity
-- Given the size and stage of development of the Group, the
Board has not formally adopted a mechanism to obtain stakeholder
feedback. However, the Group's Senior Independent Director can be
contacted at info@nuformix.com should any stakeholders wish to
contact the Group
-- The Group's strategy and business model detailed in the Chief
Executive Officer's Statement, on pages 7 to 10
-- How the Group manages risks, on pages 11 to 13
-- Corporate governance, on pages 19 to 24, including how
governance supported the delivery of our strategic objectives in
this period
Employment without discrimination
The Group is committed to recruitment of employees based on
aptitude and ability. We hire and promote our people regardless of
gender, orientation, origin, creed, disability or any other
inappropriate discrimination.
Environmental and social
In our day-to-day business, we commit to comply with applicable
environmental laws. The direct impact of our operations is low. We
also aim to undertake good housekeeping practices such as reducing
energy consumption, using sustainable resources and recycling
waste.
Statement of Directors' Responsibilities
The Directors are responsible for preparing the Annual Report
and the financial statements in accordance with applicable law and
regulations. Company law requires the Directors to prepare
financial statements for each financial year. The Directors are
required by law to prepare the Group financial statements in
accordance with International Financial Reporting Standards
("IFRSs") adopted pursuant to Regulation (EC) No 1606/2002 as it
applies in the European Union and international accounting
standards in conformity with the requirements of the Companies Act
2006 and Article 4 of the International Accounting Standards
("IAS") regulation and have also elected to prepare the Parent
Company financial statements under IFRSs in conformity with the
requirements of the Companies Act 2006 and as applied in accordance
with the provisions of the Companies Act 2006. Under Company law,
the Directors must not approve the financial statements unless they
are satisfied that they give a true and fair view of the state of
affairs of the Company and Group and of the profit or loss for that
period. In preparing the Company and Group's financial statements,
IAS Regulation requires that Directors:
-- Select suitable accounting policies and apply them consistently;
-- Make judgements and accounting estimates that are reasonable and prudent;
-- State whether applicable International Financial Reporting
Standards (IFRSs), as adopted by the European Union, have been
followed, subject to any material departures disclosed and
explained in the nancial statements; and
-- Prepare the nancial statements on the going concern basis
unless it is inappropriate to presume that the Group will continue
in business.
The Directors are responsible for keeping adequate accounting
records that are suf cient to show and explain the Group
transactions and disclose with reasonable accuracy at any time the
nancial position of the Group and enable them to ensure that the
nancial statements comply with the Companies Act 2006. They are
also responsible for safeguarding the assets of the Group and hence
for taking reasonable steps for the prevention and detection of
fraud and other irregularities.
In the case of each person who was a director at the time of
this report was approved:
-- So far as that Director is aware, there is no relevant audit
information of which the Group's auditor is unaware; and,
-- That Director has taken all steps that the director ought to
have taken as a director to make himself aware of any relevant
audit information and to establish that the Group's auditor is
aware of that information.
Independent Auditor's Report
Opinion
We have audited the financial statements of Nuformix plc (the
'Parent Company') and its subsidiary (the 'Group') for the year
ended 31 March 2021 which comprise the consolidated income
statement and statement of comprehensive income, the consolidated
statement of financial position, the consolidated statement of
changes in equity, consolidated statement of cash flows and notes
to the financial statements, including a summary of significant
accounting policies. The financial reporting framework that has
been applied in their preparation is applicable law and
International Financial Reporting Standards (IFRSs) as adopted by
the European Union.
In our opinion, the financial statements:
-- give a true and fair view of the state of the Group's and of
the Parent Company's affairs as at 31 March 2021 and of the Group's
loss for the year then ended;
-- have been properly prepared in accordance with IFRSs as adopted by the European Union; and
-- have been prepared in accordance with the requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International
Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our
responsibilities under those standards are further described in the
Auditor's responsibilities for the audit of the financial
statements section of our report. We are independent of the Group
in accordance with the ethical requirements that are relevant to
our audit of the financial statements in the UK, including the
FRC's Ethical Standard as applied to listed entities, and we have
fulfilled our other ethical responsibilities in accordance with
these requirements. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for our
opinion.
Material uncertainty related to going concern
In auditing the financial statements, we have concluded that the
directors' use of the going concern basis of accounting in the
preparation of the financial statements is appropriate. Our
evaluation of the directors' assessment of the Group's ability to
continue to adopt the going concern basis of accounting included
reviewing and challenging cash flow forecasts prepared by
management covering the period to March 2023, assessing
management's past forecasting accuracy and reviewing sensitivity
analyses of these same cashflow forecasts.
We draw attention to note 2 in the financial statements, which
indicates that the Group is not in a position where is it
self-financing and will require further funding which has not yet
been secured. Whilst management are confident that such funding
will be achieved there is an inherent material uncertainty
surrounding this. These events or conditions, along with other
matters set out in note 2, indicate that a material uncertainty
exists that may cast significant doubt on the Group's ability to
continue as a going concern. Our opinion is not modified in respect
of this matter.
Our responsibilities and the responsibilities of the directors
with respect to going concern are described in the relevant
sections of this report .
An overview of the scope of our audit
Our audit was scoped by obtaining an understanding of the Group
and its environment, including internal controls, and assessing the
risks of material misstatement.
The Group includes the listed Parent Company, Nuformix PLC, and
its trading subsidiary, Nuformix Technologies Limited. The Group's
accounting function is outsourced to a third party accountancy
firm. We included the outsourcer in our planning discussions with
management and established a dedicated portal where the outsourcer
could share the accounting records and supporting documentation
with us. We discussed with management events that had taken place
during the year in order to obtain an understanding of any changes
in the Group's environment that might impact on our audit. Our
tests included, but were not limited to, discussions with the
outsourcer as well as the Group management.
Both companies were audited by the same audit engagement team
and, accordingly, all revenue, total assets and loss before tax of
the Group were subject to audit by Haysmacintyre LLP. The main
trading entity is the focus of our audit, but, at the Parent
Company level, we also tested the consolidation process and
challenged the directors' view on the carrying value of the
investment in subsidiary and the Group intangible assets. We also
carried out analytical procedures to confirm our conclusion that
there were no significant risks of material misstatement.
We did not identify any key audit matters relating to
irregularities, including fraud. We also introduced variability
into our audit tests and assessed the risk of management override
on internal controls, including testing journals and evaluating
whether there was evidence of bias by the directors that
represented a risk of material misstatement due to fraud.
Based on our understanding of the Group our audit was focused on
the key risks as described above.
Key audit matters
Key audit matters are those matters that, in our professional
judgment, were of most significance in our audit of the financial
statements of the current period and include the most significant
assessed risks of material misstatement (whether or not due to
fraud) we identified, including those which had the greatest effect
on: the overall audit strategy, the allocation of resources in the
audit; and directing the efforts of the engagement team. These
matters were addressed in the context of our audit of the financial
statements as a whole, and in forming our opinion thereon, and we
do not provide a separate opinion on these matters.
In addition to the matter described in the material uncertainty
related to going concern section above, we have determined the
matters below to be the key audit matters to be communicated in our
report.
Key Audit How our scope addressed Key observation
Matter this matter
Carrying
value of * We have reviewed and challenged the impairment review * We obtained sufficient comfort from our audit work to
intangible prepared by management. This included: conclude that the valuation of intangible assets was
assets materially correct.
* comparison of the Group's net assets against its
market value as indicated by its share price;
* review of management assumptions underpinning their
forecasts of future earnings which provided
indicative values in use; and
* obtaining evidence of the commercial and technical
feasibility of the capitalised patents.
------------------------------------------------------------------ -----------------------------------------------------------------
Valuation Valuation models assessed We obtained sufficient
of share and reperformed where comfort from our
options possible. The competence audit work to conclude
and independence of management's that the valuation
expert valuer, whose valuation of share options
is rolled forward into was materially
the current year, was correct.
appraised last year.
Assumptions inherent to
valuation models assessed
as to whether they were
reasonable.
Review of option and warrant
agreements to ensure that
terms have been appropriately
reflected within the calculations
and assumptions.
------------------------------------------------------------------ -----------------------------------------------------------------
Our application of materiality
We define materiality as the magnitude of misstatement that
could reasonably be expected to influence the readers and the
economic decisions of the users of the financial statements. We use
materiality both in planning our audit and in evaluating the
results of our work.
We determined materiality for the Group to be GBP29,000, which
is approximately 2% of total expenditure, before the share option
charge for the year. Overall performance materiality (i.e. our
tolerance for misstatement in an individual account or balance) for
the Group was 75% of materiality, namely GBP21,750.
We have agreed to report to the Audit Committee all audit
differences in excess of GBP1,450, as well as differences below
that threshold that, in our view, warrant reporting on qualitative
grounds. We also report to the Audit Committee on disclosure
matters that we identified when assessing the overall presentation
of the financial statements.
Other information
The directors are responsible for the other information. The
other information comprises the information included in the annual
report, other than the financial statements and our auditor's
report thereon. Our opinion on the financial statements does not
cover the other information and, except to the extent otherwise
explicitly stated in our report, we do not express any form of
assurance conclusion thereon.
In connection with our audit of the financial statements, our
responsibility is to read the other information and, in doing so,
consider whether the other information is materially inconsistent
with the financial statements or our knowledge obtained in the
audit or otherwise appears to be materially misstated. If we
identify such material inconsistencies or apparent material
misstatements, we are required to determine whether there is a
material misstatement in the financial statements or a material
misstatement of the other information. If, based on the work we
have performed, we conclude that there is a material misstatement
of this other information, we are required to report that fact. We
have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act
2006
In our opinion the part of the directors' remuneration report to
be audited has been properly prepared in accordance with the
Companies Act 2006.
In our opinion, based on the work undertaken in the course of
the audit:
-- the information given in the strategic report and the
directors' report for the financial year for which the financial
statements are prepared is consistent with the financial
statements; and
-- the strategic report and the directors' report have been
prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the Group and
the Parent Company and its environment obtained in the course of
the audit, we have not identified material misstatements in the
strategic report or the directors' report.
We have nothing to report in respect of the following matters in
relation to which the Companies Act
2006 requires us to report to you if, in our opinion:
-- adequate accounting records have not been kept by the Parent
Company, or returns adequate for our audit have not been received
from branches not visited by us; or
-- the Parent Company financial statements and the part of the
directors' remuneration report to be audited are not in agreement
with the accounting records and returns; or
-- certain disclosures of directors' remuneration specified by law are not made; or
-- we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors' responsibilities
statement set out on pages 33 and 34, the directors are responsible
for the preparation of the financial statements and for being
satisfied that they give a true and fair view, and for such
internal control as the directors determine is necessary to enable
the preparation of financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are
responsible for assessing the Group's and the Parent Company's
ability to continue as a going concern, disclosing, as applicable,
matters related to going concern and using the going concern basis
of accounting unless the directors either intend to liquidate the
Group or the Parent Company or to cease operations, or have no
realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial
statements
Our objectives are to obtain reasonable assurance about whether
the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an
auditor's report that includes our opinion. Reasonable assurance is
a high level of assurance but is not a guarantee that an audit
conducted in accordance with ISAs (UK) will always detect a
material misstatement when it exists. Misstatements can arise from
fraud or error and are considered material if, individually or in
the aggregate, they could reasonably be expected to influence the
economic decisions of users taken on the basis of these financial
statements.
Irregularities, including fraud, are instances of non-compliance
with laws and regulations. We design procedures in line with our
responsibilities, outlined above, to detect material misstatements
in respect of irregularities, including fraud. The extent to which
our procedures are capable of detecting irregularities, including
fraud is detailed below.
Explanation as to what extent the audit was considered capable
of detecting irregularities, including fraud.
We identify and assess the risks of material misstatement of the
financial statements, whether due to fraud or error, and then
design and perform audit procedures responsive to those risks,
including obtaining audit evidence that is sufficient and
appropriate to provide a basis for our opinion.
Identifying and assessing potential risks related to
irregularities
In identifying and assessing risks of material misstatement in
respect of irregularities, including fraud and non-compliance with
laws and regulations, we considered the following:
-- the nature of the industry and sector, control environment
and business performance including the design of the Group's
remuneration policies, key drivers for directors' remuneration,
bonus levels and performance targets;
-- results of our enquiries of management and the audit
committee about their own identification and assessment of the
risks of irregularities;
-- any matters we identified having obtained and reviewed the
Group's documentation of their policies and procedures relating
to:
o identifying, evaluating and complying with laws and
regulations and whether they were aware of any instances of
non-compliance;
o detecting and responding to the risks of fraud and whether
they have knowledge of any actual, suspected or alleged fraud;
o the internal controls established to mitigate risks of fraud
or non-compliance with laws and regulations;
-- the matters discussed among the audit engagement team
regarding how and where fraud might occur in the financial
statements and any potential indicators of fraud.
As a result of these procedures, we considered the opportunities
and incentives that may exist within the organisation for fraud and
identified the greatest potential for fraud in the following areas:
impairment of intangibles (including goodwill), revenue
recognition, and valuation of share options. In common with all
audits under ISAs (UK), we are also required to perform specific
procedures to respond to the risk of management override. We also
obtained an understanding of the legal and regulatory frameworks
that the Group operates in, focusing on provisions of those laws
and regulations that had a direct effect on the determination of
material amounts and disclosures in the financial statements. The
key laws and regulations we considered in this context included the
UK Companies Act and Listing Rules, UK Bribery Act as well as
pensions legislation and tax legislation.
Audit response to risks identified
As a result of performing the above, we identified the following
key audit matters: impairment of intangibles (including goodwill)
and valuation of share options as key audit matters related to the
potential risk of fraud. The key audit matters section of our
report explains the matters in more detail and also describes the
specific procedures we performed in response to those key audit
matters. In addition to the above, our procedures to respond to
risks identified included the following:
-- reviewing the financial statement disclosures and testing to
supporting documentation to assess compliance with provisions of
relevant laws and regulations described as having a direct effect
on the financial statements;
-- enquiring of management and the audit committee concerning
actual and potential litigation and claims;
-- performing analytical procedures to identify any unusual or
unexpected relationships that may indicate risks of material
misstatement due to fraud;
-- reading minutes of meetings of those charged with governance; and
-- in addressing the risk of fraud through management override
of controls, testing the appropriateness of journal entries and
other adjustments; assessing whether the judgements made in making
accounting estimates are indicative of a potential bias and
evaluating the business rationale of any significant transactions
that are unusual or outside the normal course of business.
We also communicated relevant identified laws and regulations
and potential fraud risks to all engagement team members and
remained alert to any indications of fraud or non-compliance with
laws and regulations throughout the audit.
A further description of our responsibilities for the audit of
the financial statements is located on the Financial Reporting
Council's website at: www.frc.org.uk/auditorsresponsibilities .
This description forms part of our auditor's report.
Other matters we are required to address
We were appointed by the Directors to audit the financial
statements for the period ending 31 March 2016. Our total
uninterrupted period of engagement is six years, covering the
period ending 31 March 2016 and the years ended 31 March 2017,
2018, 2019, 2020 and 2021. The non-audit services prohibited by the
FRC's Ethical Standard were not provided to the Group or the Parent
Company and we remain independent of the Group and the Parent
Company in conducting our audit. Our audit opinion is consistent
with the additional report to the audit committee.
Use of our report
This report is made solely to the company's members, as a body,
in accordance with Chapter 3 of Part 16 of the Companies Act 2006.
Our audit work has been undertaken so that we might state to the
company's members those matters we are required to state to them in
an Auditor's report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility to
anyone other than the company and the company's members as a body,
for our audit work, for this report, or for the opinions we have
formed.
Consolidated Income Statement and Statement of Comprehensive
Income
For the year-ended 31 March 2021
31 March 31 March
Note 2021 2020
GBP GBP
================================================= ====== =========== ===========
Revenue 3 195,550 535,000
Cost of sales (62,307) (333,595)
=========== ===========
Gross pro t 133,243 201,405
Administrative expenses (1,507,221) (1,119,580)
Other operating income 4 1,300 4,130
=========== ===========
Operating loss 5 (1,372,678) (914,045)
Finance costs 6 (3,054) (15,837)
=========== ===========
Loss before tax (1,375,732) (929,882)
Income tax credit 10 122,235 173,506
=========== ===========
Loss for the year and total comprehensive
income for the year (1,253,497) (756,376)
=========== ===========
Loss per share - basic and diluted 11 (0.22)p (0.16)p
The above results were derived from continuing
operations.
Consolidated Statement of Financial Position
as at 31 March 2021
Registration number: 09632100 31 March 31 March
Note 2021 2020
GBP GBP
------------ ------------
Assets
Non-current assets
Property, plant and equipment 12 957 82,912
Intangible assets 13 4,186,868 4,247,862
------------ ------------
4,187,825 4,330,774
Current assets
Trade and other receivables 15 32,260 79,496
Income tax asset 121,020 172,391
Cash and cash equivalents 16 1,669,780 543,772
------------ ------------
1,823,060 795,659
------------ ------------
Total assets 6,010,885 5,126,433
------------ ------------
Equity and liabilities
Equity
Share capital 17 591,609 490,145
Share premium 6,384,835 4,480,400
Merger relief reserve 10,950,000 10,950,000
Reverse acquisition reserve (8,005,195) (8,005,195)
Share option reserve 2,005,952 1,814,613
Retained earnings (6,240,940) (4,987,443)
------------ ------------
Total equity 5,686,261 4,742,520
------------ ------------
Non-current liabilities
Loans and borrowings 19 0 37,257
Current liabilities
Trade and other payables 21 324,624 308,525
Loans and borrowings 19 0 38,131
------------ ------------
324,624 346,656
------------ ------------
Total equity and liabilities 6,010,885 5,126,433
------------ ------------
Consolidated Statement of Changes in Equity for the Year Ended
31 March 2021
Reverse
Merger relief acquisition Share option Retained
Share Share premium reserve reserve reserve earnings Total
capital GBP GBP GBP GBP GBP GBP
GBP
-------------- ------------- -------------- -------------- ------------- -------------- ----------- -----------
At 1 April
2020 490,145 4,480,400 10,950,000 (8,005,195) 1,814,613 (4,987,443) 4,742,520
Loss for the
year and
total
comprehensive
loss - - - - - (1,253,497) (1,253,497)
Issue of share
capital 101,464 2,113,535 - - - - 2,214,999
Share issue
costs - (209,100) - - - - (209,100)
Share and
warrant based
payment - - - - 191,339 - 191,339
------------- -------------- -------------- ------------- -------------- ----------- -----------
At 31 March
2021 591,609 6,384,835 10,950,000 (8,005,195) 2,005,952 (6,240,940) 5,686,261
------------- -------------- -------------- ------------- -------------- ----------- -----------
Reverse
Merger relief acquisition Share option Retained
Share capital Share premium reserve reserve reserve earnings Total
GBP GBP GBP GBP GBP GBP GBP
--------------- -------------- -------------- -------------- ------------- -------------- ----------- ---------
At 1 April 2019 490,145 4,480,400 10,950,000 (8,005,195) 1,814,613 (4,987,443) 4,742,520
Loss for the
year and total
comprehensive
loss - - - - - (756,376) (756,376)
Issue of share
capital 29,395 1,612,810 - - - - 1,642,205
Share issue
costs - (65,000) - - - - (65,000)
Share and
warrant based
payment - - - - 106,361 - 106,361
--------------- -------------- -------------- -------------- ------------- -------------- ----------- ---------
At 31 March
2020 490,145 4,480,400 10,950,000 (8,005,195) 1,814,613 (4,987,443) 4,742,520
--------------- -------------- -------------- -------------- ------------- -------------- ----------- ---------
Consolidated Statement of Cash Flows
for the Year Ended 31 March 2021
31 March 31 March
2021 2020
Note GBP GBP
Cash ows from operating activities
Loss for the year (1,253,497) (756,376)
Adjustments to cash ows from
non-cash items
Depreciation and amortisation 12,13 93,052 81,685
Loss on disposal of plant, property
and equipment 12 6,179 31
Finance costs 6 3,054 15,837
Income tax credit 10 (122,235) (173,506)
Share and warrant based payment 18 191,339 106,361
------------ ----------
(1,082,108) (725,968)
Working capital adjustments
Decrease in trade and other receivables 15 47,237 83,369
Increase/(decrease) in trade
and other payables 21 16,099 (256,178)
------------ ----------
Cash consumed by operations (1,018,772) (898,777)
Income taxes received 10 173,606 180,965
------------ ----------
Net cash out ow from operating
activities (845,166) (717,812)
Cash ows from investing activities
Acquisitions of property plant
and equipment 12 (605) (10,733)
Disposals of property plant and
equipment 12 44,322 -
Acquisition of intangible assets 13 - (32,470)
------------ ----------
Net cash ows from investing activities 43,717 (43,203)
Cash ows from nancing activities
Issue of shares (net of costs) 2,005,899 1,337,500
Interest paid 6 (3,054) (9,785)
Increase in other directors'
loans 19 505
Reduction in other loans 19 (75,388) (3,162)
Cash payment for reduction of
lease liability - (23,994)
Foreign exchange losses 6 - (538)
------------ ----------
Net cash in/(out) ows from nancing
activities 1,927,457 1,300,526
------------ ----------
Net increase/(decrease) in cash
and cash equivalents 1,126,008 539,511
------------ ----------
Cash and cash equivalents at
1 April 543,772 4,261
Cash and cash equivalents at
31 March 1,669,780 543,772
------------ ----------
Notes to the Consolidated Financial Statements
for the Year Ended 31 March 2021
1. General information
Nuformix plc ("the Company") and its subsidiary (together, "the
Group") operate in the eld of pharmaceutical development targeting
unmet medical needs in fibrosis and oncology via drug
repurposing.
The Company is a public limited company which is listed on the
Standard List of the London Stock Exchange, domiciled in the United
Kingdom ("the UK") and incorporated in England and Wales.
The address of its registered of ce is 6th Floor, 60 Gracechurch
Street, London, EC3V 0HR.
The Company relinquished its office in Cambridge in the year and
now operates in a virtual manner. Accordingly, the Company no
longer has a principal place of business.
2. Accounting policies
Basis of preparation
The nancial statements have been prepared in accordance with
International Financial Reporting Standards (IFRS Standards) and on
the historical cost basis. The nancial statements are presented in
Pounds Sterling which is the Group's functional and presentational
currency.
Statement of compliance
The Group nancial statements have been prepared in accordance
with International Financial Reporting Standards and its
interpretations adopted by the European Union ("adopted
IFRSs").
Critical Accounting Estimates and Judgements
The preparation of nancial statements in conformity with IFRS
requires the use of estimates and assumptions that affect the
reported amounts of assets and liabilities at the date of the
nancial statements and the reported amounts of revenues and
expenses during the reporting year. These estimates and assumptions
are based upon management's knowledge and experience of the
amounts, events or actions. Actual results may differ from such
estimates.
The critical accounting estimates are considered to relate to
the following:
Intangible assets
The Group recognises intangible assets in respect of goodwill
arising on consolidation. This recognition requires the use of
estimates, judgements and assumptions in determining whether the
goodwill is impaired at each year end.
Share options
The Group fair values equity-settled share-based payment
transactions using the Black-Scholes model and Monte Carlo
simulations where applicable. The use of the models involves
judgements and estimates including an assessment of whether the
shares will vest. Should actual future outcomes differ from these
assessments the amounts recognised on a straight-line basis would
vary from those currently recognised.
Basis of consolidation
The consolidated nancial statements incorporate the nancial
statements of the Company and entities controlled by the Company
(its subsidiaries) made up to 31 March each year. Control is
achieved when the Company:
-- has the power over the investee;
-- is exposed, or has rights, to variable returns from its involvement with the investee; and
-- has the ability to use its power to affect its returns.
The Company reassesses whether it controls an investee if facts
and circumstances indicate that there are changes to one or more of
the three elements of control listed above. When the Company has
less than a majority of the voting rights of an investee, it
considers that it has power over the investee when the voting
rights are suf cient to give it the practical ability to direct the
relevant activities of the investee unilaterally. The Company
considers all relevant facts and circumstances in assessing whether
the Company's voting rights in an investee are suf cient to give it
power, including:
-- the size of the Company's holding of voting rights relative
to the size and dispersion of holdings of the other vote
holders;
-- potential voting rights held by the Company, other vote holders or other parties;
-- rights arising from other contractual arrangements; and
-- any additional facts and circumstances that indicate that the
Company has, or does not have, the current ability to direct the
relevant activities at the time that decisions need to be made,
including voting patterns at previous shareholders' meetings.
Consolidation of a subsidiary begins when the Company obtains
control over the subsidiary and ceases when the Company loses
control of the subsidiary. Speci cally, the results of subsidiaries
acquired or disposed of during the year are included in pro t or
loss from the date the Company gains control until the date when
the Company ceases to control the subsidiary.
Pro t or loss and each component of other comprehensive income
are attributed to the owners of the Company and to the
non-controlling interests. Total comprehensive income of the
subsidiaries is attributed to the owners of the Company and to the
non-controlling interests even if this results in the
non-controlling interests having a de cit balance. Where necessary,
adjustments are made to the nancial statements of subsidiaries to
bring the accounting policies used into line with the Group's
accounting policies.
All intragroup assets and liabilities, equity, income, expenses
and cash ows relating to transactions between the members of the
Group are eliminated on consolidation.
Going concern
The nancial statements have been prepared on the going concern
basis of preparation which, inter alia, is based on the Directors'
reasonable expectation that the Group has adequate resources to
continue to operate as a going concern for at least twelve months
from the date of their approval. In forming this assessment, the
Directors have prepared cash ow forecasts covering the period
ending 31st March 2023 that take into account the likely run rate
on overheads and research and development expenditure and the
prudent expectations of income from out-licensing rights to its
programmes.
Whilst there can be no guarantee of the successful outcome of
on-going development work, in compiling the cash ow forecasts the
Directors have made estimates of the likely outcome of such
development work, and the possibilities of raising funds through
issues of equity and have considered alternative strategies should
projected income be delayed or fail to materialise.
The Group is not in a position where is it self-financing and
will require further funding which has not yet been secured. Whilst
the Directors understand the risks and issues around raising
further funds through an equity raise, this will be carefully
considered, as and when appropriate.
These circumstances indicate the existence of an inherent
material uncertainty, when in twelve - eighteen months' time a
thorough review of funding will be required. However, these
scenarios have already been considered and will continue to be
closely monitored by the Directors. The nancial statements do not
include any adjustments that would result if the company or Group
was unable to continue as a going concern.
The Directors have carried out a thorough review of costs and
are clear on the development work to be completed. Discretionary
costs have been carefully reviewed and reduced where reasonable to
do so while continuing to allow the prudent running of the
business.
After careful consideration, the Directors consider that they
have reasonable grounds to believe that the Group can be regarded
as a going concern and for this reason they continue to adopt the
going concern basis in preparing the Group's nancial
statements.
Exceptional items
Exceptional items are de ned as items which are non-recurring in
nature and material.
Revenue recognition
Revenue comprises the fair value of the consideration received
or receivable for the sale of goods and provision of services in
the ordinary course of the Group's activities. Revenue is shown net
of sales/value added tax, returns, rebates and discounts and after
eliminating sales within the Group.
The Group recognises revenue when:
-- the amount of revenue can be reliably measured;
-- it is probable that future economic bene ts will ow to the entity; and,
-- speci c criteria have been met for each of the Group
activities, such as the demonstration of milestone achievements in
research or acceptance by both parties.
Segmental information
There is one continuing class of business, being the research
and development of pharmaceutical products using technology
developed by the Group.
Given that there is only one continuing class of business,
operating within the UK, no further segmental information has been
provided.
Taxation
The tax income represents the sum of tax credits currently
receivable and deferred tax. Tax currently receivable is based on
taxable pro t for the year. Taxable pro t differs from net pro t or
loss as reported in the income statement because it excludes items
of income or expense that are taxable or deductible in other years
and it further excludes items that are never taxable or deductible.
The Group's current tax asset is calculated using tax rates that
have been enacted or substantively enacted at the balance sheet
date.
Deferred income taxes are calculated using the liability method
on temporary differences. Deferred tax is generally provided on the
difference between the carrying amounts of assets and liabilities
and their tax bases. However, deferred tax is not provided on the
initial recognition of an asset or liability unless the related
transaction is a business combination or affects tax or accounting
pro t.
Temporary differences include those associated with shares in
subsidiaries and joint ventures and are only not recognised if the
Group controls the reversal of the difference and it is not
expected for the foreseeable future. In addition, tax losses
available to be carried forward as well as other income tax credits
to the Group are assessed for recognition as deferred tax
assets.
Deferred tax liabilities are provided in full, with no
discounting. Deferred tax assets are recognised to the extent that
it is probable that the underlying deductible temporary differences
will be able to be offset against future taxable income. Current
and deferred tax assets and liabilities are calculated at tax rates
that are expected to apply to their respective year of realisation,
provided they are enacted or substantively enacted at the statement
of nancial position date. Changes in deferred tax assets or
liabilities are recognised as a component of tax expense in the
income statements, except where they relate to items that are
charged or credited to equity in which case the related deferred
tax is also charged or credited directly to equity.
Property, plant and equipment
Property, plant and equipment is stated in the statement of
nancial position at cost, less any subsequent accumulated
depreciation and subsequent accumulated impairment losses.
The cost of property, plant and equipment includes directly
attributable incremental costs incurred in their acquisition and
installation.
Depreciation
Depreciation is charged to write off the cost of assets, other
than land and properties under construction over their estimated
useful lives, as follows:
Asset class Depreciation method and
rate
Land and buildings 20% straight line
Computer equipment 33.33% straight line
Lab equipment 25% straight line
=================== ========================
Intangible assets
Goodwill arising on the acquisition of an entity represents the
excess of the cost of acquisition over the Group's interest in the
net fair value of the identi able assets, liabilities and
contingent liabilities of the entity recognised at the date of
acquisition. Goodwill is initially recognised as an asset at cost
and is subsequently measured at cost less any accumulated
impairment losses. Goodwill is held in the currency of the acquired
entity and revalued to the closing rate at each reporting year
date.
Goodwill is not amortised, but it is tested for impairment
annually, or more frequently if events or changes in circumstances
indicate that it might be impaired and is carried at cost less
accumulated impairment losses. Gains and losses on the disposal of
an entity include the carrying amount of goodwill relating to the
entity sold.
Goodwill is allocated to cash-generating units ("CGUs") for the
purpose of impairment testing. The allocation is made to those CGUs
or groups of CGUs that are expected to bene t from the business
combination in which the goodwill arose. The Group currently has
only one CGU.
Separately acquired trademarks and licences are shown at
historical cost. Trademarks, licences (including software) and
customer-related intangible assets acquired in a business
combination are recognised at fair value at the acquisition
date.
Trademarks, licences and customer-related intangible assets have
a nite useful life and are carried at cost less accumulated
amortisation and any accumulated impairment losses.
Amortisation
Amortisation is provided on intangible assets to write off the
cost, less any estimated residual value, over their expected useful
economic life as follows:
Asset class Amortisation method and
rate
Patents 10% straight line
Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and call
deposits, and other short-term highly liquid investments that are
readily convertible to a known amount of cash and are subject to an
insigni cant risk of changes in value.
Trade receivables
Trade receivables are amounts due from customers for services
performed in the ordinary course of business. If collection is
expected in one year or less (or in the normal operating cycle of
the business if longer), they are classified as current assets. If
not, they are presented as non-current assets.
Trade receivables are recognised initially at the transaction
price. They are subsequently measured at amortised cost using the
effective interest method, less provision for impairment. A
provision for the impairment of trade receivables is established
when there is objective evidence that the Group will not be able to
collect all amounts due according to the original terms of the
receivables.
Trade payables
Trade payables are obligations to pay for goods or services that
have been acquired in the ordinary course of business from
suppliers. Accounts payable are classi ed as current liabilities if
payment is due within one year or less (or in the normal operating
cycle of the business if longer). If not, they are presented as
non-current liabilities.
Trade payables are recognised initially at the transaction price
and subsequently measured at amortised cost using the effective
interest method.
Borrowings
All borrowings are initially recorded at the amount of proceeds
received, net of transaction costs. Borrowings are subsequently
carried at amortised cost, with the difference between the
proceeds, net of transaction costs, and the amount due on
redemption being recognised as a charge to the income statement
over the year of the relevant borrowing.
Interest expense is recognised based on the effective interest
method and is included in nance costs.
Borrowings are classi ed as current liabilities unless the Group
has an unconditional right to defer settlement of the liability for
at least 12 months after the reporting date.
Leases - After adoption of IFRS 16
IFRS 16 Leases was issued in January 2016 and was first applied
in the nancial statements for the year ended 31 March 2020 annual
reporting periods beginning on or after 1 January 2019. IFRS 16
sets out the principles for the recognition, measurement,
presentation and disclosure of leases. IFRS 16 introduced signi
cant changes to lessee accounting: it removes the distinction
between operating and nance leases under IAS 17 and requires a
lessee to recognise a right-of-use asset and a lease liability at
lease commencement for all leases, except for short-term leases and
leases of low value assets.
-- The right-of-use asset is initially measured at cost and
subsequently measured at cost less accumulated depreciation and
impairment losses, adjusted for any remeasurement of the lease
liability.
-- The lease liability is initially measured at the present
value of the future lease payments discounted using the discount
rate implicit in the lease (or if that rate cannot be readily
determined, the lessee's incremental borrowing rate). Subsequently,
the lease liability is adjusted for interest and lease payments, as
well as the impact of lease modi cations, amongst others.
IFRS 16's transition provisions permit lessees to use either a
full retrospective or a modi ed retrospective approach for leases
existing at the date of initial application of the standard, with
options to use certain transition reliefs.
The Group has elected to apply the standard using the modi ed
retrospective approach from 1 April 2019, utilising certain of the
practical expedients provided within the Standard. The company
recognised right-of-use assets and lease liabilities in the
statement of nancial position, initially measured at the present
value of the future lease payments, with the right-of-use asset
adjusted by the amount of any prepaid or accrued lease
payments.
The Group has elected to apply the following practical
expedients allowed for entities adopting IFRS 16 using the modi ed
retrospective approach:
-- Reassessment of contract - The company has made use of the
possibility not to reassess whether a contract is or contains a
lease. Accordingly, the de nition of a lease in accordance with IAS
17 and IFRIC 4 will continue to be applied to those leases entered
or changed before 1 April 2019.
-- Discount rate - Instead of requiring a lessee to determine
the incremental borrowing rate for every single lease, IFRS 16
allows a lessee to apply a single discount rate to a portfolio of
leases with reasonably similar characteristics (such as leases with
a similar remaining lease term for a similar class of underlying
asset in a similar economic environment).
-- Initial direct costs - As a practical expedient, IFRS 16
allows a lessee to exclude initial direct costs from the
measurement of the right of use (ROU) asset on transition.
-- Use of hindsight for lease term - A lessee is required to
determine the lease term at the date of initial application, which
includes purchase and renewal options reasonably expected to be
exercised and excludes termination options reasonably expected to
be exercised. To alleviate the burden of reconstructing a lessee's
initial assessment of the lease term and subsequent changes
thereafter, IFRS 16 allows a lessee to use hindsight to determine
which renewal and termination options to include or exclude.
-- Onerous lease determination - Similar to other non- nancial
assets, ROU assets are subject to impairment testing under IAS 36
Impairment of Assets and a lessee is required to perform an
impairment review for each of its ROU assets at date of initial
application. IFRS 16 allows a lessee to use its onerous contract
assessment under IAS 37 Provisions, Contingent Liabilities and
Contingent Assets immediately before transition instead of
performing an impairment review under IAS 36. The ROU asset is then
reduced by any existing provision for related onerous leases -
there were no onerous contracts within the Group as at 1 April
2019.
-- Short-term leases - For leases with a remaining term of less
than one year at the date of initial application, the lessee may
choose to apply the short-term lease exemption in IFRS 16 and
expense lease payments rather than recognize an ROU asset and a
lease liability. When using the short-term lease exemption, a
lessee is required to disclose the amount of lease payments
expensed as a result of using this expedient.
Equity
Equity comprises the following:
-- "Share capital" represents the nominal value of equity shares.
-- "Share premium" represents the amount paid for equity shares over the nominal value.
-- "Reverse acquisition reserve" arises due to the elimination
of the Company's investment in Nuformix Technologies Limited.
-- "Merger relief reserve" represents the share premium arising
on issue of shares in respect of the reverse acquisition
takeover.
-- "Share option reserve" represents the fair value of options issued.
-- "Retained earnings" represents retained earnings/losses.
De ned contribution pension obligation
A de ned contribution plan is a pension plan under which xed
contributions are paid into a separate entity and has no legal or
constructive obligations to pay further contributions if the fund
does not hold suf cient assets to pay all employees the bene ts
relating to employee service in the current and prior years.
For de ned contribution plans contributions are paid into
publicly or privately administered pension insurance plans on a
mandatory or contractual basis. The contributions are recognised as
employee bene t expense when they are due. If contribution payments
exceed the contribution due for service, the excess is recognised
as an asset.
Financial assets and liabilities
The Group's nancial assets comprise intangible and tangible xed
assets, trade and other receivables and cash and cash
equivalents.
The Group's nancial liabilities comprise trade payables.
Financial liabilities are obligations to pay cash or other nancial
assets and are recognised when the Group becomes a party to the
contractual provisions of the instruments.
Share based payments
Equity-settled share-based payments to employees and others
providing similar services are measured at the fair value of the
equity instruments at the grant date. The fair value excludes the
effect of non-market-based vesting conditions. Details regarding
the determination of the fair value of equity-settled share-based
transactions are set out in Note 18.
The fair value determined at the grant date of the
equity-settled share-based payments is expensed on a straight-line
basis over the vesting period, based on the Group's estimate of the
number of equity instruments that will eventually vest. At each
reporting date, the Group revises its estimate of the number of
equity instruments expected to vest as a result of the effect of
non-market-based vesting conditions. The impact of the revision of
the original estimates, if any, is recognised in pro t or loss such
that the cumulative expense reflects the revised estimate, with a
corresponding adjustment to reserves.
Equity -- settled share -- based payment transactions with
parties other than employees are measured at the fair value of the
goods or services received, except where that fair value cannot be
estimated reliably, in which case they are measured at the fair
value of the equity instruments granted, measured at the date the
entity obtains the goods or the counterparty renders the
service.
For cash -- settled share -- based payments, a liability is
recognised for the goods or services acquired, measured initially
at the fair value of the liability. At each reporting date until
the liability is settled, and at the date of settlement, the fair
value of the liability is remeasured, with any changes in fair
value recognised in pro t or loss for the year.
Convertible loan note
The fair value of the liability portion of a convertible loan
note is determined using a market interest rate for an equivalent
non-convertible loan note. This amount is recorded as a liability
on an amortised cost basis until extinguished on conversion or
maturity of the bonds. The remainder of the proceeds is allocated
to the conversion option. This is recognised and included in
shareholders' equity, net of income tax effects.
Investment in subsidiaries
Investments in subsidiaries are carried in the Company's balance
sheet at cost less accumulated impairment losses. On disposal of
investments in subsidiaries the difference between disposal
proceeds and the carrying amounts of the investments are recognised
in pro t or loss.
3. Revenue
The analysis of the Group's revenue for the year from continuing
operations is as follows:
2021 2020
GBP GBP
============================================ ======= =======
Rendering of services 195,550 535,000
4. Other operating income
The analysis of the Group's other operating
income for the year is as follows:
2021 2020
GBP GBP
============================================ ======= =======
Miscellaneous other operating income 1,300 4,130
5. Operating loss
Arrived at after charging
2021 2020
GBP GBP
==================================================== ======= =======
Depreciation expense (including lease depreciation) 32,058 36,724
Amortisation expense 60,994 44,961
Loss on disposal of tangible xed assets 6,179 31
Research and development expenditure 362,878 524,979
Share option charge 48,888 41,521
Warrant charge 142,451 64,840
6. Finance income and costs
2021 2020
GBP GBP
=============================================== ===== =======
Finance costs
Interest expense on other nancing liabilities 0 9,785
Interest on lease liabilities 3,054 5,514
Foreign exchange losses 0 538
===== =======
Total nance costs 3,054 15,837
===== =======
7. Staff costs
The aggregate payroll costs (including directors'
remuneration) were as follows:
2021 2020
GBP GBP
================================================== ======= =======
Wages and salaries 388,594 421,077
Social security costs 36,404 41,787
Pension costs, de ned contribution scheme 3,870 4,306
======= =======
428,868 467,170
======= =======
The average number of persons employed by the Group (including
directors) during the year and analysed by category was as
follows:
2021 2020
No. No.
========================= ==== ==============
Research and development 3 3
Non-executive directors 2 2
Total 5 5
The Company has one employee (2021: one), other than the
directors, who are employed
by Nuformix Technologies Limited.
8. Directors' remuneration
The Directors' remuneration for the year was as follows:
2021 2020
GBP GBP
============= ======= =======
Remuneration 311,096 347,077
During the year, the number of Directors who were receiving
pension bene ts was as follows:
2021 2020
No. No.
============================================== ========================= ===============
Accruing bene ts under money purchase pension
scheme 2 2
In respect of the highest paid director:
2021 2020
GBP GBP
========================================== =============== =========
Remuneration 97,000 121,000
=============== =========
9. Auditors' remuneration
2021 2020
GBP GBP
========================================== =============== =========
Audit of the nancial statements - Group 34,000 38,000
Audit of the nancial statements - Company 19,000 10,000
Audit related assurance service 5,000 10,000
10. Income tax
Tax (credited) in the income statement
2021 2020
GBP GBP
========================================== =============== =========
Current taxation
UK corporation tax (121,020) (173,506)
Adjustment in respect of prior years (1,215) -
--------------- ---------
(122,235) (173,506)
--------------- ---------
The tax on loss before tax for the year is the same as the
standard rate of corporation tax in the UK of 19% (2020: 19%).
The differences are reconciled below:
2021 2020
GBP GBP
=============================================== =========== =========
Loss before tax (1,253,497) (929,882)
=========== =========
Corporation tax at standard rate (233,414) (176,678)
Excess of capital allowances over depreciation 7,036 111
Expenses not deductible 36,354 24,280
Tax losses for which no deferred tax asset
was recognised 144,302 53,380
Adjustment in respect of prior years (1,215) -
=========== =========
Total tax credit (122,235) (173,506)
=========== =========
No deferred tax asset has been recognised as the Directors
cannot be certain that future pro ts will be suf cient for this
asset to be realised. As at 31 March 2021 the Group has tax losses
carried forward of approximately GBP4,120,000 (2020:
GBP3,350,000).
11. Loss per share
Loss per share is calculated based on the weighted average
number of shares outstanding during the period. Diluted loss per
share is calculated based on the weighted average number of shares
outstanding and the number of shares issuable as a result of the
conversion of dilutive nancial instruments.
2021 2020
GBP GBP
------------------- ----------------------------
Loss after tax (1,253,497) (756,376)
Weighted average number of shares -
basic and diluted 580,629,372 477,064,822
Basic and diluted loss per share (0.22)p (0.16)p
12. Property, plant and equipment
Land and Computer equipment Lab equipment
buildings Total
GBP GBP GBP GBP
Cost
At 1 April 2020 113,618 17,633 17,084 148,335
Additions - 605 - 605
Disposals 113,618 (16,677) (17,084) (147,379)
At 31 March 2021 - 1,561 - 1,561
Depreciation
At 1 April 2020 42,950 12,751 9,722 65,423
Charge for the year 27,367 3,062 1,629 32,058
Eliminated on disposal (70,317) (15,209) (11,351) (96,877)
At 31 March 2021 - 604 - 604
Carrying amount
At 31 March 2021 - 957 - 957
At 31 March 2020 70,668 4,882 7,362 82,912
13. Intangible assets
Goodwill Patents Total
GBP GBP GBP
======================= ========= ======= =========
Cost
At 1 April 2020 4,023,484 449,611 4,473,095
Additions - - -
========= ======= =========
At 31 March 2021 4,023,484 449,611 4,473,095
========= ======= =========
Amortisation
At 1 April 2020 - 225,233 225,233
Amortisation charge - 60,994 60,994
========= ======= =========
At 31 March 2021 - 286,227 286,227
========= ======= =========
Net book value
At 31 March 2021 4,023,484 163,384 4,186,868
At 31 March 2020 4,023,484 224,378 4,247,862
--------- ------- ---------
For impairment testing purposes, management considers the
operations of the Group to represent a single cash generating unit
(CGU) focused on pharmaceutical development, targeting unmet
medical needs in fibrosis and oncology via drug repurposing. The
directors have assessed the recoverable amount of goodwill, which
in accordance with IAS36 is the higher of its value in use and its
fair value less cost to sell (fair value), in determining whether
there is evidence of impairment.
The fair value of the CGU as at 31 March 2021 is considered by
the directors to be fairly represented by the market value of
Nuformix plc which is determined via an active liquid market on the
Standard Market of the London Stock Exchange. The share price of
Nuformix plc as at 31 March 2021 was 2.30p per share and there were
591,609,368, shares giving a fair value of GBP13,607,015
substantially in excess of the Group's net assets, including
goodwill, of GBP4,023,484, of GBP5,686,261. The directors have also
considered the value in use of the CGU, which also supported the
view that the goodwill is not impaired.
As such, the Directors do not consider there to be any
indication that the goodwill is impaired
14. Leases
An operating lease existed at 153 Cambridge Science Park,
Cambridge which has a mixed use for of ce and laboratory purposes.
This commenced in July 2017 and was surrendered in February
2021.
The table below presents by nature the "right-of-use" assets
included in the xed assets of the company in 2021.
Buildings
GBP
Cost
At 1 April 2020 81,414
Disposals (81,414)
==========
At 31 March 2021 -
==========
Depreciation
At 1 April 2020 24,702
Charge for the year 20,536
Eliminated on disposal (45,238)
==========
At 31 March 2021 -
----------
Net book value
----------
At 31 March 2021 -
----------
At 31 March 2020 56,712
----------
15. Trade and other receivables
31 March 31 March
2021 2020
GBP GBP
======================================== ======== ==========
Trade receivables - 2,690
Prepayments 14,742 44,692
Other receivables 17,518 32,114
======== ==========
32,260 79,496
-------- ----------
The fair value of trade and other receivables is considered by
the Directors not to be materially different to the carrying
amounts.
16. Cash and cash equivalents
31 March 31 March
2021 2020
GBP GBP
==================================== ========= ========
Cash at bank 1,669,780 543,772
--------- --------
The Directors consider that the carrying value of cash and cash
equivalents represents their fair value.
17. Share capital
Allotted, called up and
fully paid shares
31 March 31 March
2021 2020
======================= ======= ======================== =======
No. GBP No. GBP
=============================== ======================= ======= ======================== =======
Ordinary shares of GBP0.001
each 591,609,368 591,609 490,145,081 490,145
No.
============================================ ===========
As at 1 April 2020 490,145,081
Placement of new shares on the stock market 101,464,285
===========
As at 31 March 2021 591,609,366
===========
On 21 October 2020, the company completed a capital increase
through the issue of 23,214,285 shares of GBP0.001 each in a share
placement at a price of GBP0.028 per share, with a share premium of
GBP626,785.
On 30 March 2021, the company completed a capital increase
through the issue of 78,250,000 shares of GBP0.001 each in a share
placement at a price of GBP0.02 per share, with a share premium of
GBP1,486,750.
18. Share options and warrants
The Group operates share-based payment arrangements to
remunerate Directors and key employees in the form of a share
option scheme. Equity-settled share-based payments are measured at
fair value (excluding the effect of non-market based vesting
conditions) at the date of grant. The fair value is determined at
the grant date of the equity-settled share-based payments and is
expensed on a straight-line basis over the vesting period, based on
the Group's estimate of shares that will eventually vest and
adjusted for the effect of non- market based vesting
conditions.
The following share-based payments were made in the year to 31
March 2021:
On 1 February 2021, Novum Securities Limited was granted
warrants to subscribe for 580,357 new Ordinary shares of GBP0.001
at an exercise price of 2.8p each. The warrants are exercisable up
until 21 October 2025. The fair value of the warrants was
determined using the Black-Scholes option pricing model at 2.7p per
warrant.
On 1 February 2021, other warrants were issued for professional
services provided to subscribe for 580,357 new Ordinary shares of
GBP0.001 at an exercise price of 2.8p each. The warrants are
exercisable up until 21 October 2025. The fair value of the
warrants was determined using the Black-Scholes option pricing
model at 1.725p per warrant.
On 18 December 2020, the group agreed to grant Dr Alex Eberlin
options to subscribe for up to 586,229 new Ordinary shares of
GBP0.001 at an exercise price of 4.691p each. The options are
exercisable up until 18 December 2023. The fair value of the
options was determined using the Black-Scholes option pricing model
at 4.6p per option.
The fair value of the options and warrants issued in 2021 were
determined using the Black-Scholes option pricing model and Monte
Carlo simulations, where appropriate, and had a weighted
average
of 2.46p per option (2020: 2.51p).
The signi cant inputs into the model in respect of the options
and warrants granted in the years ended 31 March 2020 and 31 March
2021 were as follows:
2020 2021
Existing director warrants Existing
director
warrants
======================= =========================== =========
Grant date share price 3.55-6.75p 2.5-4.15p
Exercise price 4.00-6.75p 2.8p
No. of share options 6,000,000 1,160,713
Risk free rate 0.44-1.00% 0.44%
Expected volatility 50-95% 95%
Expected option life 3 years 5 years
The following table sets out details of the granted warrants and
options movements:
Warrant / Number Issued Exercised Lapsed Number Issued Lapsed Number Exercise Expiry
option of warrants in year in year in year of in year in year of price date
holder / options warrants warrants/
at 1 April / options options
2019 at 31 at 31
March March
2020 2021
Directors during year
Dr Joanne
Holland 36,860,000 - - - 36,860,000 - - 36,860,000 4-10p 16/10/22
Dr Dan
Gooding 36,860,000 - - - 36,860,000 - - 36,860,000 4-10p 16/10/22
Dr Chris
Blackwell - 3,000,000 - - 3,000,000 - - 3,000,000 4p 10/05/21
Dr Karl
Keegan - 3,000,000 - - 3,000,000 - - 3,000,000 6.75p 10/05/21
------------- ------------ ---------- ------------- ------------- ----------- ---------- ------------ ----------- --------- -----------
Previous
directors
Dr David
Tapolczay 18,430,000 - - (18,430,000) - - - -
Mr Pascal
Hughes 1,625,000 - - - 1,625,000 - (1,625,000) - 4p 16/10/20
------------- ------------ ---------- ------------- ------------- ----------- ---------- ------------ ----------- --------- -----------
Success
warrants
Whitman
Howard 250,000 - (250,000) - - - - -
Shakespeare
Martineau 1,250,000 - (1,250,000) - - - - -
------------- ------------ ---------- ------------- ------------- ----------- ---------- ------------ ----------- --------- -----------
Other warrants/options
Novum
Securities
Limited - - - - - 580,357 - 580,357 2.8p 21/10/2025
Other
warrants 580,357 580,357 2.8p 21/10/2025
Dr Alex
Eberlin - - - - - 586,229 - 586,229 4.691p 18/12/2023
------------- ------------ ---------- ------------- ------------- ----------- ---------- ------------ ----------- --------- -----------
Convertible loan note
warrants
Issued
August
2018 8,581,818 - (8,581,818)) - - - - -
Issued May
2019 - 134,692 (134,692) - - - - -
------------- ------------ ---------- ------------- ------------- ----------- ---------- ------------ ----------- --------- -----------
103,856,818 6,134,692 (10,216,510) (18,430,000) 81,345,000 1,746,942 (1,625,000) 81,466,942
------------- ------------ ---------- ------------- ------------- ----------- ---------- ------------ ----------- --------- -----------
19 Loans and borrowings
31 March 31 March
2021 2020
GBP GBP
===================================== ================= ========
Current loans and borrowings
Lease liabilities - 25,677
Directors' loan - 8,890
Other borrowings - 3,564
================= ========
- 38,131
----------------- --------
Non-current loans and borrowings
Lease liabilities - 37,257
----------------- --------
The fair value of other borrowings is considered by the
Directors not to be materially different to the carrying amounts.
Non-current lease liabilities are all due within 5 years.
20 Pension and other schemes
De ned contribution pension scheme
The Group operates a de ned contribution pension scheme. The
pension cost charge for the year represents contributions payable
by the Group to the scheme and amounted to GBP3,870 (2020:
GBP4,306).
Contributions totaling GBP292 (2020: GBP2,928) were payable to
the scheme at the end of the year and are included in
creditors.
21 Trade and other payables
31 March 31 March
2021 2020
GBP GBP
============================================== ======== ========
Trade payables 98,955 131,011
Accrued expenses 222,436 134,721
Social security and other taxes 2,941 28,527
Outstanding de ned contribution pension costs 292 2,928
Other payables - 11,338
-------- --------
324,624 308,525
The fair value of trade and other payables is considered by the
Directors not to be materially different to the carrying amounts.
All payables are due within one year.
22 Financial instruments
Credit risk
The main credit risk relates to liquid funds held at banks. The
credit risk in respect of these bank balances is limited because
the counterparties are banks with high credit ratings assigned by
international credit rating agencies.
Liquidity risk
The Group seeks to manage nancial risk, to ensure suf cient
liquidity is available to
meet foreseeable needs. An analysis of trade and other payables is given in Note 21.
Capital risk management
The Group's objectives when managing capital are:
-- to safeguard the Group's ability to continue as a going
concern, so that it continues to provide returns and bene ts for
shareholders;
-- to support the Group's growth; and
-- to provide capital for the purpose of strengthening the
Group's risk management capability.
The Group actively and regularly reviews and manages its capital
structure to ensure an optimal capital structure and equity holder
returns, taking into consideration the future capital requirements
of the Group and capital ef ciency, prevailing and projected pro
tability, projected operating cash ows, projected capital
expenditures and projected strategic investment opportunities.
Management regards total equity
as capital and reserves, for capital management purposes.
23 Related party transactions
All transactions with related parties are conducted on an arm's
length basis.
The remuneration of the key management personnel of the Group,
who are de ned as the directors, is set out in the directors'
remuneration report.
Transactions with directors
During the year the Group made the following related party
transactions:
Dr Chris Blackwell (Director)
Included in creditors due in less than one year is an interest
free loan from Dr Chris Blackwell. At the balance sheet date, the
amount owed to Dr Chris Blackwell was GBPnil (2020: GBP4,146).
Dr Karl Keegan (Director)
Included in creditors due in less than one year is an interest
free loan from Dr Karl Keegan. At the balance sheet date, the
amount owed to Dr Karl Keegan was GBPnil (2020: GBP4,648).
Dr Dan Gooding (Director)
Included in creditors due in less than one year is an interest
free loan from Dr Dan Gooding. At the balance sheet date, the
amount owed to Dr Dan Gooding was GBPnil (2020: GBP95).
Ultimate controlling party
The Directors do not consider there to be a single ultimate
controlling party.
Company Statement of Financial Position
as at 31 March 2021
Registration number: 09632100
31 March 31 March
2021 2020
Note GBP GBP
============================== ====== =========== ===========
Assets
Non-current assets
Investment in subsidiary 27 11,250,000 11,250,000
=========== ===========
11,250,000 11,250,000
=========== ===========
Current assets
Trade and other receivables 28 966,461 1,770,066
Cash and cash equivalents 29 1,588,378 507,417
=========== ===========
2,554,839 2,277,483
=========== ===========
Total assets 13,804,839 13,527,483
=========== ===========
Equity and liabilities
Equity
Share capital 17 591,609 490,145
Share premium 6,384,835 4,480,400
Merger relief reserve 10,950,000 10,950,000
Share option reserve 2,005,952 1,814,613
Retained earnings (6,332,753) (4,380,472)
=========== ===========
Total equity 13,599,643 13,354,686
=========== ===========
Current liabilities
Trade and other payables 30 205,196 172,797
=========== ===========
205,196 172,797
=========== ===========
Total equity and liabilities 13,804,839 13,527,483
=========== ===========
Company Statement of Changes in Equity
as at 31 March 2021
Merger
Share Share relief Share Retained
capital premium reserve option earnings Total
GBP GBP GBP reserve GBP GBP
GBP
=================================== ========= ========= ========== ========= =========== ===========
At 1 April 2020 490,145 4,480,400 10,950,000 1,814,613 (4,380,472) 13,354,686
Loss for the year and total
comprehensive
income - - - - (1,952,281) (1,952,281)
Share issued and warrant exercised 101,464 2,113,535 - - - 2,214,999
Share and warrant based payment - - - 191,339 - 191,339
Share issue costs - (209,100) - - - (209,100)
--------- --------- ---------- --------- ----------- -----------
At 31 March 2021 591,609 6,384,835 10,950,000 2,005,952 (6,332,753) 13,599,643
--------- --------- ---------- --------- ----------- -----------
Share Share Merger Share Retained
capital premium relief option earnings Total
reserve reserve
GBP GBP GBP GBP GBP GBP
=================================== ========= ========= ========== ========= =========== ===========
At 1 April 2019 460,750 2,932,590 10,950,000 1,708,252 (4,015,779) 12,035,813
Loss for the year and total
comprehensive
income - - - - (364,693) (364,693)
Share issued and warrant exercised 29,395 1,612,810 - - - 1,642,205
Share and warrant based payment 106,361 106,361
Share issue costs - (65,000) - - - (65,000)
--------- --------- ---------- --------- ----------- -----------
At 31 March 2020 490,145 4,480,400 10,950,000 1,814,613 (4,380,472) 13,354,686
--------- --------- ---------- --------- ----------- -----------
Company Statement of Cash Flows
==============================
for the year-ended 31 March 2021
========================================== ====== =========== =========
2021 2020
Note GBP GBP
========================================== ====== =========== =========
Cash ows from operating activities
Loss for the year (1,952,281) (364,693)
Adjustments to cash ows from non-cash
items
Finance costs - 4,340
Provision against intergroup balance 1,288,000 -
Share and warrant based payment 191,339 106,361
Equity element of convertible loan - -
note
----------- ---------
(472,942) (253,992)
Working capital adjustments
Decrease/(increase) in trade and
other receivables 28 11,434 106,024
Increase in trade and other payables 30 32,399 68,616
=========== =========
Net cash out ow from operating activities (429,109) (79,352)
=========== =========
Cash ows from investing activities
Loan to subsidiary (495,829) (748,636)
Loan repayments from subsidiary - -
=========== =========
Net cash (used)/generated by investing
activities (495,829) (748,636)
=========== =========
Cash ows from nancing activities
Issue of shares (net of costs) 2,005,899 1,337,500
Interest on convertible loan and
exchange gains - (4,340)
=========== =========
Net cash ows from nancing activities 2,005,899 1,333,160
=========== =========
Net increase in cash and cash equivalents 1,080,961 505,172
Cash and cash equivalents at 1 April 507,417 2,245
=========== =========
Cash and cash equivalents at 31 March 1,588,378 507,417
----------- ---------
24 Signi cant accounting policies
Basis of preparation
The separate nancial statements of the Company are presented as
required by the Companies Act 2006. As permitted by that Act, the
separate financial statements have been prepared in accordance with
IFRSs as adopted by the EU.
The nancial statements have been prepared on the historical cost
basis. The principal accounting policies adopted are the same as
those set out in Note 2 to the Consolidated Financial Statements.
In addition, Investments in subsidiaries are stated at cost less,
where appropriate, provision for impairment.
25 Loss attributable to shareholders
Under section 408 of the Companies Act 2006 the Company is
exempt from the requirement to present its own income statement.
The loss attributable to the Company in the year was GBP1,952,281
(2020: loss GBP364,693).
26 Staff costs
The aggregate payroll costs (including directors'
remuneration) were as follows:
2021 2020
GBP GBP
=================================================== ======= =======
Wages and salaries 112,135 117,077
Social security costs 11,853 7,679
======= =======
123,988 124,756
------- -------
The executive directors are employed by Nuformix Technologies
Limited, a wholly owned subsidiary of the Company.
27 Investment in Subsidiary
GBP
As at 1 April 2020 and 31 March 2021 11,250,000
The Company has the following interests in subsidiaries:
Equity Interest
Name Country of Incorporation 2021 2020
Nuformix Technologies
Limited United Kingdom 100% 100%
======================= =============================== =========== =====
28 Trade and other receivables
31 March 31 March
2021 2020
GBP GBP
--------- ----------
Amount owed by Group undertakings 942,070 1,734,241
Prepayments 9,786 26,433
Other receivables 14,605 9,392
--------- ----------
966,461 1,770,066
The fair value of trade and other receivables is considered by
the Directors not to be materially different to the carrying
amounts.
29 Cash and cash equivalents
31 March 31 March
2021 2020
GBP GBP
============================= ========= ========
Cash at bank 1,588,378 507,417
The Directors consider that the carrying value of cash and cash
equivalents represents their fair value.
30 Trade and other payables
31 March 31 March
2021 2020
GBP GBP
============================ ======== ========
Trade payables 58,054 68,767
Accrued expenses 147,142 102,691
Other payables - 1,339
======== ========
205,196 172,797
======== ========
The fair value of trade and other payables is considered by the
Directors not to be materially different to the carrying
amounts.
31 Financial instruments
Credit risk
The main credit risk relates to liquid funds held at banks. The
credit risk in respect of these bank balances is limited because
the counterparties are banks with high credit ratings assigned by
international credit rating agencies.
Liquidity risk
The Company seeks to manage nancial risk, to ensure suf cient
liquidity is available to meet foreseeable needs. An analysis of
trade and other payables is given in Note 30.
Capital risk management
The Company's objectives when managing capital are:
-- to safeguard the Company's ability to continue as a going
concern, so that it continues to provide returns and bene ts for
shareholders;
-- to support the Company's growth; and
-- to provide capital for the purpose of strengthening the
Company's risk management capability.
The Company actively and regularly reviews and manages its
capital structure to ensure an optimal capital structure and equity
holder returns, taking into consideration the future capital
requirements of the Company and capital ef ciency, prevailing and
projected pro tability, projected operating cash ows, projected
capital expenditures and projected strategic investment
opportunities. Management regards total equity as capital and
reserves, for capital management purposes.
32 Related parties
The Company's related parties are the directors and other Group
companies.
The remuneration of the key management personnel of the Group,
who are de ned as the directors, is set out in the directors'
remuneration report. Details of the fair value of transactions with
key management and their close family members is included in Note
23.
All amounts outstanding with related parties are unsecured and
will be settled in cash. No guarantees have been given or received
in respect of amounts outstanding. A provision of GBP1,288,000
(2020: nil) was made in the year against the balance due from
Nuformix Technologies Limited. No other provisions have been made
for doubtful debts in respect of amounts owed by other related
parties.
At the balance sheet date, the gross amounts due from other
Group companies were as follows:
31 March 31 March
==============================
2021 2020
GBP GBP
============================== ======== =========
Nuformix Technologies Limited 942,070 1,734,241
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