TIDMPHC
RNS Number : 7365N
Plant Health Care PLC
27 September 2023
27 September 2023
Plant Health Care plc
( " Plant Health Care", the " Group " and the " Company")
Unaudited Interim Results
Strong second half of 2023 expected to drive material revenue
growth
Plant Health Care(R) (AIM: PHC.L), a leading provider of novel
patent-protected biological products to global agriculture markets,
announces its unaudited interim results for the six months ended 30
June 2023 ("H1 2023").
Financial Highlights:
-- Overall revenue increased 1% to $5.6 million (H1 2022: $5.5 million)
-- Revenue in Brazil was up 48%, driven by in-market demand for
H2Copla(R) (up 29% on-ground) and Saori(R) (up 38%). Revenue in
Mexico was up 12%, while sales in Europe were flat.
-- In the US, distributors delayed purchases of all agricultural
inputs in H1 2023 to drive down inventories in a negative market.
Accordingly, US sales were down 56% in the period, resulting in low
inventories in the channel, pointing to strong sales in H2 2023.
Customer on-ground sales in the field grew strongly, with Employ(R)
up 35% and FASTAND up 9%.
-- Cash used in operations increased 33% to $2.8 million (H1
2022: $2.1 million) due to higher trade receivables and lower
accounts payable offset by inventory improvement. The Group's cash
burn is typically significantly higher in the first half than in
the second half.
-- In June 2023, the Group raised $3.3 million (net of
expenses). Cash as at 30 June 2023 was $5.7 million (2022: $6.3
million).
Operational Highlights:
Distributor agreements
-- Signed exclusive distribution agreement with Novozymes to
launch Harpin<ALPHA><BETA> in Indian sugar cane
production. First commercial sales are expected once registration
is achieved, expected in H1 2024.
-- Following the registration of PHC279 in the USA earlier this
year, a distribution agreement was concluded with Wilbur Ellis(R)
Agribusiness. OBRONA(R) was launched in June of 2023 as a foliar
fungicide for fruits, nuts, vegetables, and row crops. The Company
is now selling PREtec products on three continents.
New product registrations
-- A new PREtec product PHC68949 for the control of soil
nematodes received the first regulatory approvals for commercial
use in Brazil. Full registration is expected in late 2023 or early
2024, ahead of launch into soybeans in 2024. The Group expects to
introduce PHC68949 to other crops in Brazil subsequently.
-- Achieved three significant country registrations for
Harpin<ALPHA><BETA> in Europe (Poland, France and
Cyprus); plans are advancing for product launches in these
geographies, anticipated in 2024.
Outlook:
-- Strong second half of 2023 expected with material revenue
growth anticipated, resulting in revenue for the year in line with
market expectations.
-- On track to achieve revenue of $30 million by 2025 through
continued growth in Harpin<ALPHA><BETA> and the launch
of new peptides, supported by current and new distributor
relationships. This will deliver a fast-growing, profitable and
cash generative business.
Jeff Tweedy, CEO, Plant Health Care, commented: "Market
conditions in H1 2023 have been very challenging for traditional
agricultural input businesses, with most large companies reporting
significant reduction in revenue. The US has been particularly
difficult, with all distributors sharply reducing inventory to
reduce the impact of price volatility and slow demand. Most of the
agribusiness companies saw significant revenue decline in the first
half of 2023 as compared to last year.
In that context, growth outside the US allowed the Group to grow
revenue marginally; importantly, profit margins were maintained.
Strong on ground sales growth in our core markets gives us
confidence in robust revenue growth in H2.
The Group's first-half performance was driven by the growing
demand for Harpin 𝜶 <BETA> and Saori in Brazil.
The Brazilian market for Saori is significant, with potential for
$10 million in revenue. We expect a strong second half revenue
performance, which will underpin the Group's target to deliver $30
million in revenue in 2025.
The Group continues to register new products. We received the
first PREtec approval from the US EPA with the product being
marketed under the brand name OBRONA. With the launch of PREzym (R)
and OBRONA we now market PREtec on three continents, which is a
significant accomplishment. We plan to launch new PREtec products
for the next three years. Our strategy of expanding relationships
with major global distribution partners is on track.
During the first half of the year, we signed a new agreement
with Novozymes in India and a new commercial agreement for OBRONA
with Wilbur-Ellis.
There continues to be strong demand and interest in our
products. The world has an ever-increasing need for more food with
sustainable agriculture at the heart of meeting this need. Farmers
face many challenges, including the impacts of climate change such
as drought, to ensure food security. Plant Health Care helps
farmers solve these problems. Our biological products produce
better quality crops and deliver higher yield, and we are well
placed to benefit as the need for our products increases."
Change of Name of Nominated Adviser and Joint Broker
The Company also announces that its Nominated Adviser and Broker
has changed its name to Cavendish Securities plc following the
completion of its own corporate merger.
Plant Health Care plc Tel: +1 919 926 1600
Jeffrey Tweedy - Chief Executive Officer
Jeffrey Hovey - Chief Financial Officer
Cavendish Securities plc - Nomad & Broker Tel: +44 (0) 131 220 9771
Neil McDonald / Peter Lynch
SEC Newgate (Financial Communications) Tel: +44 (0)7540 106366
Robin Tozer / George Esmond Email: phc@secnewgate.co.uk
About Plant Health Care
Plant Health Care offers products to improve the health, vigour
and yield of major field crops such as corn, soybeans, potatoes and
rice, as well as specialty crops such as fruits and vegetables. We
operate globally through subsidiaries, distributors and supply
agreements with major industry partners. Our innovative,
patent-protected biological products help growers to protect their
crops from stress and diseases, and to produce higher quality fruit
and vegetables, with a favourable environmental profile.
Find out more at www.planthealthcare.com
Chief Executive Officer's Statement
Overview
Plant Health Care is at the heart of the movement toward
sustainable food production. Our core products are derived from
naturally occurring proteins, which make crops healthier, grow
better and able to withstand stress such as drought and disease.
They provide growers with higher yield and better-quality crops,
while having a much lower impact on the environment than
conventional agricultural chemicals.
The last six months have seen difficult economic conditions
around the globe, including high interest rates, causing growers,
particularly in the US, to delay purchases of new supplies, and to
focus on reducing existing inventories. This meant our product
consumption plans previously agreed with distributors were not met
as growers waited for prices to fall. Despite these headwinds,
revenue increased 1% to $5.6 million (H1 2022: $5.5 million). As in
previous years, annual revenue is second half weighted. Most of the
agribusiness companies saw significant revenue decline in the first
half of 2023 as compared to last year. With lower inventories and
strong customer on-ground sales, we are expecting a strong second
half of 2023 with material revenue growth anticipated.
Our balance sheet is strong, with cash used in operations
increasing 33% to $2.8 million (H1 2022: $2.1 million) due to
higher trade receivables and lower accounts payable offset by
inventory improvement. Cash burn is typically significantly higher
in the first half of the year than in the second half. In June
2023, the Group raised $3.3 million (net of expenses). Cash as at
30 June 2023 was $5.7 million (2022: $6.3 million).
Products
While our sales to distributors declined, sales by our
distributors to growers (on-ground sales), increased for various
products, including 9% for FASTAND, 35% for Employ, 29% for
H2Copla, of which 27% is for sugar cane processers. These are all
Harpin<ALPHA><BETA> products. Sales of our first PREtec
product, Saori, increased 38%.
During the period, the Group began switching to our new European
toll manufacturer. Due to this, the Group paid for excess
Harpin<ALPHA><BETA> inventory to ensure that stock
levels are adequate to meet the second half 2023 expected
demand.
Harpin<ALPHA><BETA>
Harpin<ALPHA>ß is a recombinant protein that acts as a
powerful biostimulant, improving the yield and quality of crops.
The Group sells Harpin<ALPHA>ß through specialist
distributors around the world. During the first half of 2023, the
Group continued to see the accelerated adoption of
Harpin<ALPHA>ß in Brazil as sales to sugar processors
increased.
Harpin revenue in South America and Mexico increased but fell in
North America. This meant overall Harpin 𝜶 <BETA>
revenue decreased by 15% to $2.8 million (H1 2022: $3.3 million).
This decrease was due to severe drought in the Midwest and delayed
purchases by growers.
PREtec
The Company's PREtec technology platform (Vaccines for
Plants(TM)) continues to develop. Derived from natural proteins,
PREtec is an environmentally friendly technology which stimulates
crop growth and ability to withstand a variety of abiotic stresses
as well as to improve disease control, plant health and yield.
PREtec is compatible with mainstream agricultural practices.
The Group is building on the successful launch of our first
PREtec product, Saori used in Brazil for the prevention and
treatment of soybean diseases. Saori was fully launched in Brazil
in the second quarter of 2022 and has generated revenue of $1.8
million. Overall sales of PREtec products are $2.0 million.
After ten years and an investment of more than $25 million, the
Group has launched PREtec on three continents with new launches
planned every year for the next three years pending regulatory
approvals.
The Group is extending the development of PREtec products in
Europe and elsewhere over the coming years. Europe is the world's
largest market for sustainable agriculture with annual sales of
over $2 billion and is, therefore, an attractive opportunity for
PREtec. Substantial opportunities also exist for PREtec products in
other countries across South and Central America, Mexico,
Australia, and Asia. These markets will be pursued as resources
permit.
Geographic growth
During the period, the Group continued to expand and deepen its
presence across the world, focusing on the largest agricultural
producers, in North and South America, Europe, and most recently,
India.
North America
Total revenue in North America was $0.6 million (2022: $1.4
million) which follows 2022 which was the best year in North
America in the Group's history. Delayed grower purchases reduced
first half purchases of our products by distributors. However,
Harpin on-ground sales in North America were up 52% versus
2022.
In June, the Group concluded a distribution agreement with
Wilbur-Ellis(R) Agribusiness, one of the largest US retailers of
agricultural products. The agreement will support commercial sales
of OBRONA , a foliar fungicide recently approved by the US EPA. In
June of 2023, the Group had its first sale of OBRONA generating
revenue of $0.1 million to Wilbur-Ellis. OBRONA is a unique product
developed to help growers control a wide range of fungal and
bacterial plant pathogens in fruits, nuts, vegetables, and row
crops.
Plant Health Care and Wilbur-Ellis have been working together in
an exclusive partnership since 2020 to evaluate and develop PHC279,
the active ingredient in OBRONA, for high value specialty and row
crop markets. PHC279 is the first product from the Company's PREtec
technology platform that is available to US farmers.
Looking ahead, we expect growth in the US, especially for our
OBRONA and Employ products used for row crops.
South America
The Group is present in Brazil, Argentina, and Chile with plans
to launch in Uruguay by 2024. Total revenue was $1.9 million (2022:
$1.3 million) , primarily driven by increased sales of Saori onto
soybeans and continued strong demand for H2Copla
(Harpin<ALPHA><BETA>) from sugar cane processors. In
the 2023/24 season, the area planted with sugar cane in Brazil is
forecast to be 9.8 million hectares, and in the 2022/23 season,
sugar cane was planted on 8.3 hectares.
In May 2022, Plant Health Care and Nutrien Soluções Agrícolas,
the retail business of Nutrien in Brazil, signed a five-year
commercial agreement under which the Group will supply Saori for
Nutrien's use on soybeans in Brazil. Nutrien is the world's largest
provider of crop inputs and services. Nutrien expects to expand
Saori use to more than one million hectares by 2025. The Company's
revenue from sales of Saori to Nutrien is expected to grow to more
than $5 million by 2025.
In May, o ur new PREtec product PHC68949 received the first
stage of regulatory approval for commercial use in Brazil. This is
a novel technology that amplifies a plant's natural defence against
damaging nematodes, resulting in increased plant health and yield
in a variety of crops. Nematodes are microscopic parasitic worms
living in the soil where they feed on plant roots, killing plants
and reducing crop yields. Globally, nematodes have been estimated
to cause up to 12.3% of annual crop loss, worth approximately $157
billion per year.
After its initial launch for use in soybeans, the Group expects
to introduce PHC68949 in other crops in Brazil. According to a
recently published report by Kynetec, the use of nematicides in
Brazil has increased 10-fold since 2015, with soybeans accounting
for 52% of the use, followed by sugarcane at 23%, with the
remainder on corn, cotton, coffee, potatoes and 14 other crops.
After the period-end in August, the Group's biochemical
fungicide, PHC279, for the control of sugar cane and coffee disease
received federal approval in Brazil. As well as being the world's
largest producer of sugar cane, Brazil is also the biggest coffee
producer. In the 2023/24 season, the area planted with coffee was
more than 2.5 million hectares. In the 2021/22 season, Brazilian
farmers spent more than US$127 million on the control of coffee
diseases.
Overall, South America has performed well despite significant
market headwinds. We expect significant growth to continue as more
products are approved.
Mexico
In Mexico, the Group also distributes third-party biological
products. In Mexico, revenue was up 12% to $2.0 million (H1 2022:
$1.7 million) due to continued expansion into the agave and avocado
markets. In September, Plant Health Care submitted applications to
the Mexican regulatory agency for approval to commercialise the
newest products derived from the Company's PREtec technology
platform (Vaccines for PlantsTM), PHC25279 and PHC68949, for use on
major crops
EMEAA
Revenue in EMEAA was flat at $1.2 million (2022: $1.2 million)
due to drought conditions in Spain.
Following the initial regulatory approval of Harpin
<ALPHA><BETA> in France in October 2022, Plant Health
Care has pursued Mutual Recognition to expand the use of
Harpin<ALPHA><BETA> across Europe. Europe is the
world's largest market for sustainable agriculture with annual
sales of over $2 billion.
In August, Harpin<ALPHA><BETA> successfully achieved
Mutual Recognition in Poland. This is a major milestone for the
Group and permits immediate sales of
Harpin<ALPHA><BETA> in Poland. Poland is the sixth
largest agricultural producer in the European Union, and the second
largest potato producer behind Germany, growing around 322,000
hectares.
The Group launched PREzym in Portugal, and last year, announced
a trials agreement with Agrii UK under which Agrii evaluated the
Group's PREtec technology. Studies indicated promising results with
PREtec products in potatoes, resulting in improved potato quality
and yield, with significantly lower environmental impact than many
agrochemical treatments.
In January 2023, the Group signed an agreement for the exclusive
distribution of Harpin<ALPHA><BETA> for use in sugar
cane production in India with Novozymes South Asia Pvt. Ltd. First
commercial sales are expected to commence in the first half of
2024, after receipt of the required regulatory approvals. This is
the first product introduced into India by the Group. India is the
world's second largest producer of sugar cane with about five
million hectares under cultivation.
Looking ahead, the Group will continue to expand across Europe
and India and is exploring new opportunities in Asia.
Outlook
We are expecting a strong second half of 2023 with material
revenue growth anticipated. The Board expects to achieve full-year
market expectations despite macro-level, market-driven challenges
like inflation and increasing interest rates.
The continued expansion of Plant Health Care's relationships
with large distributors has given us greater visibility of
on-ground sales, which improves our ability to forecast demand,
plus broad access to specialty and row crop markets.
The Board remains confident about the prospects of building a
growing, profitable commercial business, as sales of
Harpin<ALPHA><BETA> continue to increase due to market
expansion and new registrations.
We are on track to achieve revenue of $30 million by 2025
through the launch of new PREtec peptides, and organic business
growth through current and future distributor relationships.
Jeffrey Tweedy
Chief Executive Officer
27 September 2023
Chief Financial Officers Statement
Summary of financial results
Financial highlights for the six months ended 30 June 2023, with
comparatives for the six months ended 30 June 2022, are set out
below:
2023 2022
$'000 $'000
Revenue 5,603 5,554
Gross profit 3,386 3,411
Research and development (1,357) (1,433)
Sales and marketing (2,202) (2,136)
Administrative (1,553) (1,630)
Non-cash expenses (831) (787)
Foreign exchange gain/ (loss) *** 18 (3,607)
----------------------------------- ----------- ----------
Total operating expenses (5,925) (9,593)
Operating loss (2,539) (6,182)
----------------------------------- ----------- ----------
Net finance (expense)/ income 24 (105)
Net loss for period before tax (2,515) (6,287)
----------------------------------- ----------- ----------
*** - includes non-cash currency gain of $18 thousand primarily
related to inter-group loans with subsidiaries and other payments
in foreign currencies (H1 2022: $3.6 million currency losses).
Cash operating expenses decreased $0.1 million to $5.1 million
(H1 2022: $5.2 million).
The reconciliation of operating loss to LBITDA is as
follows:
2023 2022
($'000) ($'000)
Operating loss (2,539) (6,182)
Depreciation/amortisation 338 322
Share-based payments 473 465
Intercompany foreign exchange
(gain) / loss (18) 3,607
Adjusted LBITDA (1,746) (1,788)
Revenue
Revenues for the six-month period ended 30 June 2023 were $5.6
million (H1 2022: $5.5 million) producing a gross profit of $3.4
million (H1 2022: $3.4 million) and the loss before tax was $2.5
million (H1 2022: $6.3 million). The gross profit margin was 60%
(H1 2022: 61%). The decrease in gross margin was due to decreased
sales into the North American market due to market severe drought
in the Midwest and excess inventory in the channel, offset by
higher margin Saori sales in South America.
Harpin<ALPHA><BETA> revenue decreased 15% (19% constant
currency) to $2.8 million (H1 2022: $3.3 million).
Harpin<ALPHA><BETA> revenues were primarily lower than
prior year due to severe drought in the Midwest and excess
inventory in the channel in the US specialty markets, offset by
increased sales of 68% into the sugar cane market in Brazil. Saori
revenues increased 38% to $1.1 million (H1 2021: $0.8 million) in
Brazil due to increased demand from soybean producers.
Cash operating expenses
Operating expenses, excluding non-cash items, decreased $0.1
million to $5.1 million (H1 2022: $5.2 million) due to decreased
Administration expenses offset by increased sales and marketing
expenses associated with the expansion of the commercial business
globally. Adjusted LBITDA decreased $0.1 million to $1.7 million
(H1 2021: $1.8 million) primarily due to decreased operating
expenses and gross margin was consistent with the prior year.
Operating expenses
Operating expenses decreased by $3.7 million for the six-month
period to $5.9 million (2021: $9.6 million). This is primarily due
to $3.6 million of non-cash currency losses primarily related to a
Pound Sterling loan with a subsidiary company (H1 2022: $3.6
million currency losses).
Cash position and liquidity
As of 30 June 2023, the Group had cash and investments of $5.7
million. Cash, working capital and costs continue to be tightly
controlled.
Net cash outflows from operating activities increased 33% to
$2.8 million (H1 2022: $2.1 million and H2 2022: $0.6 million ).
The increase is due to increased inventory payments due to the
switch to a new toll manufacturer to ensure adequate stock to meet
second half demand and increased receivable balance due to delay in
payment from a North American customer.
Net cash used in financing activities increased $3.4 million (H1
2022: $9.2 million net cash flows from financing activities). The
increase is due to the June 2023 equity raise of $3.3 million (net
of costs).
Jeffrey Hovey
Chief Financial Officer
27 September 2023
Consolidated statement of comprehensive income
FOR THE SIX MONTHSED 30 JUNE 2023
Six months Six months
to 30 June to 30 June
2023 2022
(Unaudited) (Unaudited)
Note $'000 $'000
Revenue 5,603 5,554
Cost of sales (2,217) (2,143)
Gross profit 3,386 3,411
Research and development (1,546) (1,740)
Sales and marketing (2,221) (2,136)
Administrative expenses (2,158) (5,717)
-------------------------------------- ----- --------------------- -------------------
Operating loss 3 (2,539) (6,182)
Finance income 68 11
Finance expense (44) (116)
-------------------------------------- ----- --------------------- -------------------
Loss before tax (2,515) (6,287)
Income tax expense (73) (50)
Net loss for the period (2,588) (6,337)
-------------------------------------- ----- --------------------- -------------------
Other comprehensive income:
Exchange difference on translation
of foreign operations 290 (446)
-------------------------------------- -----
Total comprehensive loss
for the period (2,298) (2,811)
====================================== ===== ===================== ===================
Basic and diluted loss per
share 6 $(0.01) $(0.01)
====================================== ===== ===================== ===================
Consolidated statement of financial position
AT 30 JUNE 2023
30 June 31 December
2023 2022
(Unaudited) (Audited)
Note $'000 $'000
Assets
Non-current assets
Intangible assets 1,985 1,620
Property, plant and
equipment 588 644
Right-of-use assets 367 586
Trade and other receivables 159 146
Total non-current assets 3,099 2,996
---------------------------------------- ------------------------- ------------------
Current assets
Inventories 3,072 3,371
Other receivables 2,520 1,801
Cash and cash equivalents 5,745 5,656
---------------------------------------- ------------------------- ------------------
Total current assets 11,337 10,828
---------------------------------------- ------------------------- ------------------
Total assets 14,436 13,824
---------------------------------------- ------------------------- ------------------
Liabilities
Current liabilities
Trade and other payables 2,508 3,235
Borrowings 167 55
Lease liabilities 289 437
Total current liabilities 2,964 3,727
---------------------------------------- ------------------------- ------------------
Non-current liabilities
Borrowings 188 215
Long term lease liabilities 108 192
Total non-current liabilities 296 407
---------------------------------------- ------------------------- ------------------
Total liabilities 3,260 4,134
---------------------------------------- ------------------------- ------------------
Total net assets 11,176 9,690
======================================== ========================= ==================
Capital and reserves
attributable to owners
of the Company
Share capital 4,788 4,352
Share premium 103,734 100,859
Foreign exchange reserve 3,146 2,856
Retained deficit (100,492) (98,377)
----------------------------------------
Total equity 11,176 9,690
======================================== ========================= ==================
Consolidated statement of cash flows
FOR THE SIX MONTHSED 30 JUNE 2023
Six months ended Six months ended
30 June 30 June
2023 2022
(Unaudited) (Unaudited)
$'000 $'000
Cash flows from operating activities
Loss for the year (2,589) (6,337)
Adjustments for:
Depreciation of property, plant
and equipment 107 112
Depreciation of right-of-use assets 231 215
Amortisation of intangibles - 1
Share-based payment expense 474 465
Finance income (68) (11)
Finance expense 44 116
Foreign exchange (loss)/ gain (18) 3,607
Income taxes paid 73 49
Decrease in trade and other receivables (634) 180
Gain on disposal of fixed assets - -
(Increase)/decrease in inventories 432 (1,275)
Increase/(decrease) in trade and
other payables (822) 560
Income taxes received (73) 179
Net cash used in operating activities (2,843) (2,139)
------------------------------------------ ----------------- -----------------
Investing activities
Purchase of property, plant and
equipment (37) (286)
Sale of property, plant and equipment - -
Finance income 68 (85)
Purchase of investments - -
Sale of investments - 3,868
Investment in internally generated (365) -
intangible assets
------------------------------------------ ----------------- -----------------
Net cash (used)/provided by investing
activities (334) 3,497
------------------------------------------ ----------------- -----------------
Financing activities
Finance expense (31) (90)
Lease payments (260) (235)
Issue of ordinary share capital 3,311 -
Borrowings 252 -
Payment of borrowings (170) (14)
------------------------------------------ ----------------- -----------------
Net cash provided/(used) by financing
activities 3,102 (339)
------------------------------------------ ----------------- -----------------
Net increase/(decrease) in cash
and cash equivalents (75) 1,019
Effects of exchange rate changes
on cash
and cash equivalents 164 (58)
Cash and cash equivalents at beginning
of period 5,656 1,005
------------------------------------------ ----------------- -----------------
Cash and cash equivalents at end
of period 5,745 1,966
========================================== ================= =================
Notes to the unaudited financial information
1 General information
Plant Health Care plc is a company incorporated and domiciled in
England. The unaudited interim financial information of the Group
for the six months ended 30 June 2023 comprise the Company and its
subsidiaries (together referred to as the "Group").
The Board of Directors approved this interim report on 26
September 2023.
2 Basis of preparation and accounting policies
These interim consolidated financial statements have been
prepared using accounting policies based on international
accounting standards in conformity with the requirements of the
Companies Act 2006. They do not include all disclosures that would
otherwise be required in a complete set of financial statements and
should be read in conjunction with the 31 December 2022 Annual
Report. The financial information for the half years ended 30 June
2023 and 30 June 2022 does not constitute statutory accounts within
the meaning of Section 434 (3) of the Companies Act 2006 and both
periods are unaudited.
The annual financial statements of Plant Health Care Plc ('the
Group') are prepared in accordance with international accounting
standards in conformity with the requirements of the Companies Act
2006. The statutory Annual Report and Financial Statements for the
year ended 31 December 2022 have been filed with the Registrar of
Companies. The Independent Auditors' Report on the Annual Report
and Financial Statements for this year end was unqualified, did not
draw attention to a matter by way of emphasis, and did not contain
a statement under 498(2) or 498(3) of the Companies Act 2006.
The Group has applied the same accounting policies and methods
of computation in its interim consolidated financial statements as
in its 31 December 2022 annual financial statements, except for
those that relate to new standards and interpretations effective
for the first time for periods beginning on (or after) 1 January
2023 and will be adopted in the 2023 financial statements. There
are deemed to be no new and amended standards and/or
interpretations that will apply for the first time in the next
annual financial statements that are expected to have a material
impact on the Group.
Going Concern
In assessing whether the going concern basis is appropriate for
preparing the interim results for 2023, the Directors have utilised
the Group's detailed forecasts, which take into account its current
and expected business activities, its cash and cash equivalents
balance and investments of $6.3 million. The principal risks and
uncertainties the Group faces and other factors impacting the
Group's future performance were considered. The directors confirm
that they have a reasonable expectation that the group will have
adequate resources to continue in operational existence for the
next 12 months from approval of these financial statements and
accordingly these financial statements are prepared on a going
concern basis, with no material uncertainty over going concern. As
such, the interim consolidated financial statements have been
prepared on a going concern basis.
3 Operating loss
Six months
to Six months to
30 June 30 June
2023 2022
(unaudited) (unaudited)
$'000 $'000
Operating loss is stated after
charging:
Depreciation 338 327
Amortisation - 1
Share-based payment expense 474 465
Foreign exchange (gain)/loss (18) 3,607
4 Segment information
The Group views, manages and operates its business according to
geographical segments. Revenue is generated from the sale of
agricultural products across all geographies.
Six months to 30 June 2023 (unaudited)
Rest
of Total New
Americas Mexico World Elimination Commercial Technology Total
$'000 $'000 $'000 $'000 $'000 $'000 $'000
Revenue*
Proprietary
product
sales 2,541 460 1,101 - 4,102 - 4,102
Third-party
product
sales - 1,501 - - 1,501 - 1,501
Inter-segmental
product sales 630 - 130 (760) - - -
Total revenue 3,171 1,961 1,231 (760) 5,603 - 5,603
----------- ---------- ------- -------------- ------------- ------------- --------
Cost of sales (1,432) (1,038) (507) 760 (2,217) - (2,217)
Research and
development - - - - - (1,125) (1,125)
Sales and
marketing (1,294) (484) (460) - (2,238) (56) (2,294)
Administration (659) (205) (54) - (918) (95) (1,013)
Non-cash
expenses:
Depreciation (93) (43) (13) - (149) (189) (338)
Amortisation - - - - - - -
Share-based
payment (68) (1) (22) - (91) (213) (304)
----------- ---------- ------- -------------- ------------- ------------- --------
Segment
operating
(loss)/profit (375) 190 175 - (10) (1,678) (1,688)
Corporate
expenses
**
Wages and
professional
fees (824)
Administration
*** (27)
Operating loss (2,539)
Finance income 69
Finance expense (45)
----------- ---------- ------- -------------- ------------- ------------- --------
Loss before tax (2,515)
----------- ---------- ------- -------------- ------------- ------------- --------
* Revenue from one customer within the Americas segment totalled
$1,037,000 or 19% of Group revenues.
Revenue from one customer within the Americas segment totalled
$862,000 or 15% of Group revenues.
Revenue from one customer within the Americas segment totalled
$784,000 or 14% of Group revenues
** These amounts represent public company expenses for which
there is no reasonable basis by which to
allocate the amounts across the Group's segments.
*** Includes net share-based payments expense of $170,000
attributed to corporate employees who are not affiliated with any
of the Commercial or New technology segments.
Six months to 30 June 2022 (unaudited)
Rest
of Total New
Americas Mexico World Elimination Commercial Technology Total
$'000 $'000 $'000 $'000 $'000 $'000 $'000
Revenue*
Proprietary
product
sales 2,659 282 1,158 - 4,099 - 4,099
Third-party
product
sales 2 1,452 1 - 1,455 - 1,455
Inter-segmental
product sales 857 - - (857) - - -
Total revenue 3,518 1,734 1,159 (857) 5,554 - 5,554
----------- ------- ------- -------------- ------------- ------------- --------
Cost of sales (1,752) (897) (351) 857 (2,143) - (2,143)
Research and
development - - - - - (1,245) (1,245)
Sales and
marketing (1,254) (375) (411) - (2,040) (106) (2,147)
Administration (630) (128) (49) - (807) (130) (937)
Non-cash
expenses:
Depreciation (74) (41) (7) - (122) (200) (321)
Amortisation - - (1) - (1) - (1)
Share-based
payment (80) - (23) - (103) (223) (326)
----------- ------- ------- -------------- ------------- ------------- --------
Segment
operating
(loss)/profit (272) 293 317 - 338 (1,904) (1,566)
Corporate
expenses
**
Wages and
professional
fees (965)
Administration
*** (3,651)
Operating loss (6,182)
Finance income 11
Finance expense (116)
----------- ------- ------- -------------- ------------- ------------- --------
Loss before tax (6,287)
----------- ------- ------- -------------- ------------- ------------- --------
* Revenue from one customer within the Americas segment totalled
$1,146,000 or 21% of Group revenues.
* Revenue from one customer within the Americas segment totalled
$775,000 or 14% of Group revenues.
** These amounts represent public company expenses for which
there is no reasonable basis by which to
allocate the amounts across the Group's segments.
*** Includes net share-based payments expense of $80,000
attributed to corporate employees
who are not affiliated with any of the Commercial or New
technology segments. Includes $0.4
million foreign exchange gains in non-US dollar denominated
inter-company funding.
6 Loss per share
Basic loss per ordinary share has been calculated on the basis
of the loss for the period of $2,588,000 (loss for the six months
ended 30 June 2022: $6,337,000) and the weighted average number of
shares in issue during the period of 310,423,602 (six months ended
30 June 2022: 304,662,482).
The weighted average number of shares used in the above
calculation is the same as for total basic loss per ordinary share.
Instruments that could potentially dilute basic earnings per share
in the future have been considered but were not included in the
calculation of diluted earnings per share because they are
anti-dilutive for the periods presented. This is due to the Group
incurring losses on continuing operations for the period.
7 Cautionary statement
This document contains certain forward-looking statements
relating to Plant health Care plc ('the Group'). The Group
considers any statements that are not historical facts as
"forward-looking statements". They relate to events and trends that
are subject to risk and uncertainty that may cause actual results
and the financial performance of the Group to differ materially
from those contained in any forward-looking statement. These
statements are made by the directors in good faith based on
information available to them and such statements should be treated
with caution due to the inherent uncertainties, including both
economic and business risk factors, underlying any such
forward-looking information .
Copies of this report and all other announcements made by Plant
Health Care plc are available on the Company's website at
www.planthealthcare.com/for-investors.
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END
IR NKABBABKDDCB
(END) Dow Jones Newswires
September 27, 2023 02:00 ET (06:00 GMT)
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